EFTA01103147.pdf

IN THE CIRCUIT COURT OF THE FIFTEENTH JUDICIAL CIRCUIT, IN AND FOR PALM BEACH COUNTY, FLORIDA CASE NO. 50-2009-CA-040800-XXXX-MB-AG JEFFREY EPSTEIN, Plaintiff/Counter-Defendant, vs. SCOTT ROTHSTEIN, individually, and BRADLEY J. EDWARDS, individually, Defendants/Counter-Plaintiffs. TRANSCRIPT OF HEARING Volume 1 of 1 Pages 1 - 33 DATE: Monday, June 10, 2013 TIME: 4 o'clock, p.m. PLACE: Palm Beach County Courthol. ., 205 North Dixie Highway West Palm Beach, Florida 33401 BEFORE: Honorable David Crow, Circuit Court Judge This cause came on to be heard at the time and place aforesaid. The following proceedings were reported by: Roger Watford, RPR/FPR U.S. Legal Support, Inc. 444 West Railroad Avenue Suite 300 West Palm Beach, Florida 33401 (561) 835-0220 WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103147  APPEARANCES: 2 FOR THE PLAINTIFF/COUNTER-DEFENDANT: 3 LAW OFFICES OF TONJA HADDAD COLEMAN, P.A. 4 315 Southeast 7th Street Suite 301 5 Fort Lauderdale, Florida 33301 954-467-1223 6 BY: TONJA HADDAD COLEMAN, ESQ. 7 8 FOR THE DEFENDANT/COUNTER-PLAINTIFF: 9 SEARCY, DENNEY, SCAROLA, BARNHART & SHIPLEY, P.A. 10 2139 Palm Beach Lakes Boulevard West Palm Beach, Florida 33409 11 561-686-6300 BY: JACK SCAROLA, ESQ. 12 13 FOR FARMER, JAFFE, WEISSING, EDWARDS, 14 FISTOS & LEHRMAN, P.L.: 15 FARMER, JAFFE, WEISSING, EDWARDS, FISTOS & LEHRMAN, P.L. 16 425 North Andrews Avenue Suite 2 17 Fort Lauderdale, Florida 33301 954-524-2820 18 BY: GARY M. FARMER, JR., ESQ. 19 20 21 22 23 24 25 WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103148  1 The above-styled cause came on for 2 hearing before the Honorable David Crow, 3 Circuit County Court Judge, at the Palm Beach 4 County Courthouse, 205 North Dixie Highway, 5 West Palm Beach, Florida, on June 10, 2013, 6 commencing at 4 o'clock, p.m., as follows: 7 THE COURT: Okay, this is Epstein versus 8 Rothstein and Bradley Edwards. It's the 9 motion for protective order in regards to the 10 request which has been submitted to Mr. 11 Edwards, and I understand there's a comparable 12 request to the corporate law firm as well, 13 right? 14 MS. COLEMAN: Yes, Your Honor. 15 THE COURT: Did I schedule this for an 16 hour or did you all ask for an hour? 17 MR. SCAROLA: I don't recall. 18 THE COURT: It doesn't appear to be an 19 hour long hearing in my estimation. 20 MR. SCAROLA: I would agree, Your Honor. 21 I don't think that it is. I don't know 22 whether that is as a consequence of our 23 overestimating the time or whether somehow 24 Your Honor decided that it would be an hour. 25 I don't know. WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103149  1 THE COURT: Probably I did it because I 2 generally don't give an hour unless, I thought 3 I had looked at it, but after looking at it 4 again this weekend, I didn't think it would 5 take an hour. But, anyway, it's your motion, 6 Mr. Scarola. Is someone here for the law firm 7 as well? 8 MR. SCAROLA: They are scheduled to be 9 here. I was informed earlier today there 10 would be two lawyers from Farmer Jaffe who 11 would be present. I don't see any reason why 12 we can't proceed with my motion, although were 13 they hear to listen to my argument they might- 14 be able to abbreviate theirs by adopting 15 portions of it. 16 THE COURT: I think they are the same 17 issues. Here they are. 18 MR. FARMER: My apologies, Your Honor. 19 We had a hellacious drive from Broward 20 County. My apologies. 21 THE COURT: Okay, good enough Go ahead, 22 sir. I read the motion and I have read the 23 request for production and I hope I am 24 familiar enough with the lawsuit by now. 25 MR. SCAROLA: I suspect you are more WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103150  1 familiar than you would have chosen to be and 2 choose to be. 3 Jack Scarola, on behalf of the 4 counter-plaintiff, Bradley Edwards, Your 5 Honor. This is our motion for protective 6 order. 7 Focusing on the scope of discovery that 8 is being sought with regard to financial 9 information concerning Mr. Edwards and his 10 earnings as an attorney, both personal 11 records, records of the law firm that employs 12 him and in which he is a shareholder, it is 13 based upon what we contend to be an irrelevant 14 effort to invade his financial privacy, the 15 financial privacy of the firm and the privacy 16 of his clients as well. 17 I think that the dispute focuses on a 18 misunderstanding on the part of the 19 counter-defendant of what it is that we are 20 claiming as damages in this matter. I have 21 explained that difference hopefully with some 22 degree of clarity in the written submission 23 that we provided to Your Honor, and knowing 24 that you have read it and recognizing that 25 Your Honor has a substantial background in WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103151  1 this case, I will keep my argument very short 2 and simply make myself available to answer any 3 questions that Your Honor may have. 4 We are not attempting to allege that 5 Bradley Edwards lost any specific fee or 6 specific earnings as a consequence of his 7 having been maliciously named in litigation 8 brought by Mr. Epstein. What we are 9 contending is that his time was diverted from 10 a variety of other matters because he was 11 obliged to devote time to the defense of a 12 baseless claim. 13 That time was taken away from his 14 employment, it was taken away from his family, 15 that is time he would have otherwise devoted 16 to his family, and it was taken away from all 17 other activities in which he ordinarily would 18 engage. 19 The time has a value. That value has 20 been established by the price that others have 21 been willing to pay for that time and we would 22 offer evidence and have supported that with 23 disclosures that have been made of what that 24 value is. 25 That is, records have been kept with WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103152  1 regard to the amount of time contemporaneous 2 records have been kept, with regard to the 3 amount of time Mr. Edwards has been obliged to 4 the devote to the defense of the claim, not 5 separate involvement in prosecuting of this 6 counterclaim but simply to the defense of the 7 claim that was wrongfully brought against him, 8 and we have kept records with regard to the 9 hourly work that he did during that same 10 period of time and the rates that he was paid 11 for that hourly work. 12 That is appropriate discovery and we have 13 acknowledged its appropriateness and have made 14 disclosures in that regard. We do not believe 15 that anything else is relevant in light of the 16 theory of damages that we intend to pursue. 17 We don't believe that the broad request 18 for discovery that have been made casts any 19 light upon our damage claim in any respect at 20 all. We believe that it is irrelevant and 21 immaterial, designed to solely annoy, harass 22 and embarrass and unnecessarily invade the 23 economic and financial privacy of the 24 counter-plaintiff. 25 So, with that, I am available to answer WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103153  1 any questions you might have or otherwise 2 reserve time for response to the other side's 3 arguments. 4 THE COURT: Yes. 5 MR. FARMER: However Your Honor wishes to 6 proceed, I just wanted to remind the Court 7 that the law firm has also filed its own 8 motion for protective order, because many of 9 these records involve our firm, the 10 shareholder agreement, et cetera, and so we 11 have filed a separate motion for protective 12 order. 13 THE COURT: Why don't you go ahead and 14 make your argument, because they are 15 substantially similar I guess, other than I 16 guess you do have other privacy rights apart 17 from them. 18 MR. FARMER: Thank you, Your Honor. 19 Gary Farmer, Your Honor, on behalf of the 20 law firm of Farmer, Jaffe, Weissing, Edwards, 21 Fistos & Lehrman. 22 I don't have much to add. We adopt the 23 arguments made by Mr. Scarola. I think the 24 key focus here is does this discovery request- 25 even raise a colorable relevant inquiry, given WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103154  1 the limitation on the damage claim, as 2 explained to the Court by Mr. Scarola. 3 My partner, Brad Edwards, is not seeking 4 damages associated with any business claim 5 that he could have cases, he could have 6 brought in cases he could have pursued, but 7 for the time spent in defending against this 8 case. 9 THE COURT: Let me ask you. Perhaps this 10 is more direct to Mr. Scarola, and I will give 11 him an opportunity to respond before I hear 12 from counsel for the counter-defendant, but 13 I've tried to reduce things to a simplistic 14 analogy because of the complexity of this 15 case. 16 Suppose, rather than losing time as , 17 result of defending these alleged baseless 18 allegations, Mr. Edwards was involved in an 19 automobile accident, not claiming loss of 20 income, by the way, claiming as a result of 21 having to go to doctors and therapy and to, 22 and because of all of this accident, get his 23 car fixed and all that, he has had to devote 24 time away from his work, his family, and, by 25 the way, just happens that the measure of that. WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103155  1 is $350 an hour, whatever his hourly rate is. 2 Are you suggesting under those 3 circumstances that at least some of his 4 financial records showing what he earns, how 5 he earns it, when he earns it, how much time 6 he spends doing that is not relevant? 7 MR. FARMER: Well, I don't want to speak 8 for Mr. Edwards personally, but -- 9 THE COURT: I have had situations where 10 doctors have tried to make that same argument- 11 in front of me and other professionals and it. 12 a straight tort case and I said wait a minute, 13 you know, you can't sanitize this to the point 14 of trying to keep those records out, because, 15 while it may not be a loss of income claim, 1. 16 is a loss of time claim, and how you spend 17 your time and what you do with your time and 18 how much money you make with that time is 19 relevant for the case, at least discoverable. 20 MR. FARMER: Well, Your Honor, with 21 respect, again, I would not speak for Mr. 22 Scarola, I will let him address this as to Mr. 23 Edwards, but, as I understood Mr. Scarola just 24 a minute ago, and I would agree with this if 25 my understanding of what he said is correct, WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103156  1 and that is, certainly evidence as to the rate 2 that Brad Edwards has received either in court 3 awards or -- 4 THE COURT: The fact that he's spending 5 80 hours a week in the office, for example, or 6 his billing hours are this or he billed this 7 or spends this much time, how would that not 8 be relevant to determine whether or not what 9 he is saying is true or does he have to accept 10 the testimony from Mr. Edwards that, oh, by 11 the way, I had to spend 20 hours doing work on 12 this file or something like that? 13 MR. FARMER: I think the reason I would 14 disagree, Your Honor, is that if Mr. Edwards 15 would not have been compelled to spend the 16 time he was forced to spend defending against 17 the baseless lawsuit, he wouldn't necessarily 18 have had to have spent that working on another 19 case, it took away from his private time, hiss 20 family time, it took away from recreational 21 time. 22 At some point there must be a measure ass 23 to the value of that time, but I wouldn't 24 agree, Your Honor, that it has to come from 25 his average work week, if you will, or his WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103157  1 prior history of work, and it certainly isn't 2 based upon or relevant to, and returning back 3 to the discovery that affects my law firm, and 4 that is asking for the partnership agreement 5 with our firm, asking for the K1 tax returns 6 and distribution schedules for the last four 7 calendar years from all of our law firm, 8 asking for the current tax records of our law 9 firm, quote, all documentation related to all 10 settlements, attorney's fee awards, jury 11 verdict awards and arbitration/mediation 12 income received by Farmer, Jaffe, Weissing, 13 Edwards, Fistos & Lehrman, P.L. 14 Your Honor, I do not see how that 15 information is discoverable. I think at the 16 very least, as we pointed out in our memo and 17 under the case law, the Spry versus 18 Professional Employer Plans case, 985 So.2d, 19 1187, I think at the very least you have to 20 conduct an evidentiary hearing and then review 21 the documents in camera just to make sure that 22 the scope of what you are going to allow to be 23 discovered, if anything, is appropriate and to 24 confirm that if there is a prima facie showing 25 of possible relevance that, once you review WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103158  1 those documents themselves, you do find them 2 to be relevant to the claim. 3 Again, Your Honor, I don't believe that, 4 given the limitation on Mr. Edwards' claim, 5 not claiming a loss of income, not claiming, 6 "I didn't get more cases because of this 7 time," just simply, "I was forced to devote 8 time to a frivolous lawsuit," that measurement 9 can be made and it is really separate and 10 apart -- 11 THE COURT: What difference is that from 12 a doctor that comes in and says, "Well, you 13 know, because of my injuries here I had to 14 devote, I had to devote time to physical 15 therapy, I had to devote time for this, devote 16 time for that, and, by the way, I make 17 $125,000 a day when I am in surgery"? I can't 18 get -- they can't get the financial records 19 under those circumstances? 20 MR. FARMER: I think in that situation, 21 physician claiming an injury which has 22 affected his ability to practice medicine -- 23 THE COURT: It doesn't matter what it is 24 that's causing the loss, the fact is it's the 25 loss of time, and how can time be measured WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103159  1 other than what he is doing? 2 MR. FARMER: Well, I would again submit, 3 Your Honor, I think there is a record Mr. 4 Edwards' career has established, and I think 5 this is more analogous, Your Honor, if I can, 6 than an injury claim, which is based on some 7 measure loss of income, to mean this is more 8 analogous to -- 9 THE COURT: Well, whether it caused a 10 loss of income or not, he is saying, "I have 11 not been able to devote time to my 12 professional practice that I ordinarily would 13 have done and, therefore, I am entitled to an 14 hourly rate of," whatever his hourly rate is, 15 "times the time I missed I couldn't spend on 16 it." 17 Again, I think it would be a stretch to 18 say, okay, the time with my family is worth 19 $350 an hour. I am not sure that is competent 20 testimony as to how much time he's missing, 21 vacation time with your family, but when you 22 are talking about loss of professional time 23 and measuring it by your hourly rate -- I 24 understand your position. 25 MR. FARMER: If I could just close with WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103160  15 1 this, Your Honor, this is more analogous to me 2 to a, when the Court is in the position of 3 awarding prevailing party attorney's fees. 4 You are simply looking at the numbers of 5 hours worked on the file and you are 6 determining a reasonable and customary rate 7 for an attorney of that level of skill, 8 experience, training. 9 And in this case that is, we're talking 10 about, it's essentially an award of time 11 incurred in the defense of this case. 12 THE COURT: Unless you happen to be some 13 of the marital family attorneys and they ask 14 for your other time records for the day and 15 find out you have put in 89 hours in one day. 16 MR. FARMER: That is true. 17 THE COURT: Okay. Mr. Scarola, I will 18 allow you to respond. Let me hear from her 19 first, then you can answer my questions as 20 well. 21 MR. SCAROLA: Thank you, Your Honor. 22 MS. COLEMAN: Thank you, Judge. Good 23 afternoon. I will be brief since you 24 obviously read our memorandum of law in 25 opposition to their motion. WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103161  1 With respect to the argument first made 2 by Mr. Scarola, the argument that they are 3 trying to seek some kind of time diverted 4 because of work fails for two reasons. First- 5 of all, as the Court already correctly stated, 6 this time must be quantified. How do we 7 quantify the time unless, as you say, we know 8 how much time you normally spent, what took 9 the time away. 10 With respect to that argument, the larger 11 issue that nobody seems to remember is the 12 fact that, because of this unique situation, 13 Mr. Edwards is an attorney, he hired an 14 attorney right away to defend this alleged 15 spurious claim, the very well capable Mr. 16 Scarola. Were it his time at issue, maybe 17 this argument would be relevant, but any time 18 Mr. Edwards allegedly lost with respect to 19 this isn't even relevant to the claim. 20 We are not asking how much time Mr. 21 Edwards spent defending this cause of action 22 because that would be attorney's fees, which 23 are not permissible at this time. We are 24 trying, rather, to quantify what time was 25 diverted. His hourly rate, providing us with WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103162  1 his hourly rate and how many hours he spent on 2 this case, does not show us how much time was 3 diverted. In order to properly defend this 4 cause of action or examine the damages Mr. 5 Edwards is alleged to suffer, we must have 6 these records. 7 Mr. Edwards, it's very important, has 8 never been counsel of record in this case 9 until two months before we dismissed the 10 lawsuit in the case in chief. How much time 11 he spent, again, he had an attorney, those 12 aren't the records we are seeking. 13 His Complaint has very specific special 14 damages pled, injury to reputation, mental 15 anguish, embarrassment, anxiety, fear of 16 physical injury, loss of the value of his time 17 required to be diverted from his professional 18 responsibilities and the cost of defending 19 this spurious and baseless claim that Mr. 20 Epstein filed. 21 That's directly from his fourth amended 22 counterclaim. I brought a copy for the Court- 23 if you would like to see it. Would you like 24 to see it? 25 THE COURT: Yes. WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103163  1 MS. COLEMAN: It's in two paragraphs, 2 Judge, paragraphs 17 and 33, both of which are 3 tabbed for your convenience. 4 I would also point out to the Court that- 5 this is a tort case. You would be surprised 6 that malicious prosecutions are torts. We are 7 in the same situation we would be with any 8 other tort. 9 We request documents from 2009 to present 10 because Mr. Epstein filed this lawsuit in 2009 11 in November and Mr. Edwards filed his counter- 12 claim, which is the case we are here on now, 13 in December, right away. Those records are 14 the only way pursuant to which we can 15 establish what damages, if any, he suffered. 16 The request made to the law firm or 17 specifically, if you have a Schedule A, if not 18 I will provide you with mine, requests 3, 4, 5 19 and 6, and they do ask for settlements, 20 attorney's fees awards, jury verdict awards 21 and the like. Attached to another motion we 22 filed, the law firm of Farmer, Jaffe, 23 Weissing, Edwards, Fistos & Lehrman does take 24 quite a bit of time to advertise its jury 25 verdict awards, and we would like to have WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103164  1 something other than a newspaper from which to 2 quantify the amount of money that's being 3 earned. 4 It is absolutely necessary that since the 5 date of the inception of this lawsuit Mr. 6 Edwards has been a shareholder and employee at 7 this law firm and this information is germane 8 to his own case. Damages are an essential 9 element to both causes of action. 10 Furthermore, Judge, when we received a 11 copy of the motion for protective order we did 12 send them a letter, which is attached to our 13 memorandum in opposition, in which we stated 14 that we understand the confidentiality 15 potentially of their business records, their 16 clients and the third parties that may be 17 involved in these settlements and offered that 18 we just wanted the amounts, the bottom line, 19 the financial number and the name of the 20 attorneys who worked on the case and 21 originated the case to see whether or not that 22 included Brad Edwards. 23 We are not unsympathetic to the fact that 24 client information could be confidential. We 25 just want the numbers, Judge. WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103165  1 THE COURT: Let me ask you, one thing 2 that confuses me, it looks like the duces 3 tecum is the same for both. Am I right? 4 MS. COLEMAN: Judge, we served the duces 5 tecum on Mr. Edwards personally because he is 6 a shareholder at the firm. 7 THE COURT: Right. 8 MS. COLEMAN: This was served on Mr. 9 Edwards to bring to his deposition. 10 THE COURT: Some of them don't make 11 accepts in regards to corporations is what I 12 am getting at. 13 MS. COLEMAN: Numbers 3 through 6 were 14 the only ones to the corporation. That's why 15 the corporation is specifically listed, Judgc. 16 THE COURT: Okay. Go ahead. 17 MS. COLEMAN: That's all, Judge. We do 18 respect the fact that the corporation may not 19 want to give confidential client information 20 or confidential settlement agreement 21 information to us and we already said that we 22 would just like the number and whether or not 23 Mr. Edwards is an attorney who worked on the 24 case, the originating attorney, the billing 25 attorney. WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103166  21 1 As the Court has already correctly 2 pointed out, we need to know what the value of 3 that time is, how to quantify these alleged 4 hours that he is claiming were diverted from 5 his attention to his office. With that, as 6 you pointed out, we need to know what other 7 cases, if any, he was working on, how much 8 time was taken away from those cases, how much 9 money did he lose as a result of this case, 10 how much time was taken away as a result of 11 this case. 12 The arguments we just heard sound more 13 like an impermissible seeking of attorney's 14 fees. We are not there yet. This isn't a 15 prevailing party motion. This isn't a 16 57.105. Mr. Edwards was not counsel of record 17 in this case. He was a defendant just like 18 any other. He had counsel. How much time Mr. 19 Edwards spent as an attorney on this case is 20 irrelevant. 21 But we need to know what the value of the 22 time is that he allegedly lost due to this 23 case, if any, and how to quantity that so we 24 can properly assess the damages he's alleging 25 as well as how to defend this action. This WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103167  1 information is relevant and it's narrowly 2 tailored to the pertinent time frame and we 3 would submit, therefore, that the protective 4 order should not be granted. 5 THE COURT: Thank you. 6 Mr. Scarola. 7 MR. SCAROLA: Thank you, Your Honor. 8 Your Honor, some considerable time ago we 9 were asked to brief for Your Honor's benefit 10 the recoverable elements of damage in a 11 malicious prosecution claim, and my 12 recollection is that we submitted those 13 memoranda. 14 They included cases that specifically 15 talked about recoverability of compensation 16 for lost time as a consequence of having to 17 defend against a maliciously prosecuted 18 claim. 19 The focus here is indeed on the time that 20 Brad Edwards lost. It is not upon the loss of 21 his income. Your Honor has correctly observed 22 that the discovery that is reasonably directed 23 at testing the credibility of Brad Edwards' 24 claim with regard to the amount of time that 25 he lost is appropriate. WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103168  1 It would be entirely appropriate for the 2 defense to make requests that test the 3 credibility of Brad Edwards' assertion that on 4 a particular day he devoted X number of hours 5 to the defense of this case in his capacity as 6 a defendant in a malicious prosecution claim. 7 But let's look at the duces tecum that we 8 are before the Court to address. And I think 9 you will find that not one of the requests 10 that has been made, with perhaps one 11 exception, focuses upon anything that would be 12 relevant to Brad Edwards' claim that a 13 specific amount of time was lost in the 14 defense of this claim. 15 Number 1 asks for five years of income 16 tax returns. Income tax returns will say 17 nothing about time. Number 2 asks for income 18 tax records, which say nothing about time. 19 Number 3 asks for income tax records and 20 Schedule Kl's for the law firm, which 21 obviously say nothing about Brad Edwards' 22 time. Number 4 asks for a copy of all 23 documentation related to all settlements, 24 attorney's fees awards, jury verdict awards 25 and arbitration/mediation income received by WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103169  1 Farmer Jaffe and Brad Edwards. 2 This is the one exception I spoke about. 3 Mr. Edwards is claiming a particular value for 4 his time. Attorney's fee awards of Brad 5 Edwards would be relevant and material to that 6 claim. We have disclosed those. We believe 7 that that, in fact, is appropriate discovery. 8 Attorney's fees awarded to some other lawyer 9 in the firm or to the firm in general in cases 10 that don't involve Brad Edwards could not 11 possibly have any bearing upon the value of 12 Brad Edwards' time. 13 It is also significant to note that this 14 is primarily a firm that earns its income 15 based upon contingency fee representation. 16 The firm may spend an extraordinary amount of 17 time to recover no fee at all or a very small 18 fee or it may spend a small amount of time to 19 recover a very large fee. 20 But how much time they actually spent, 1. 21 they kept any time records at all, to recover 22 a fee in a contingent case would have no 23 bearing upon the contention that Mr. Edwards' 24 time is worth a particular amount of money 25 when that time is provided in exchange for WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103170  1 hourly fees. So, if it relates to hourly 2 fees, it's discoverable. If it does not, I 3 suggest that it is not. 4 Now, the next is number 6 asking for the 5 partnership agreement, and again we are more 6 than happy to provide that to Your Honor for 7 in camera inspection to determine whether it 8 has anything to do whatsoever with an hourly 9 rate of compensation for Mr. Edwards. 10 I represent to Your Honor that it does 11 not. But I understand that the other side 12 would be entitled to an independent 13 confirmation. If you want to take a look at 14 it to assure yourself that it has nothing to 15 do with the value of Mr. Edwards' time, we 16 would be happy to provide it to the Court for 17 in camera inspection. 18 Now, the next, 1, 2, well, number 7, 19 number 8, number 10, number 11 and number 12 20 all talk about documents that we intend to 21 rely upon, copies of any and all memorandum, 22 diaries, journals, et cetera upon which you 23 rely in support of your allegation of lost 24 time. We are providing what we intend to rely 25 upon. That is what they are asking for. We WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103171  26 1 are giving it to them. These are Mr. Edwards' 2 contemporaneous time records. That's what we 3 are relying upon. They haven't asked for 4 anything else. They have just asked for what- 5 we are relying upon. 6 Number 8 asks for copies of all 7 memorandum, diaries, et cetera upon which yon. 8 rely in support of your allegation of injury 9 to your reputation. We are providing what we 10 rely upon. We are certainly not going to 11 withhold anything that we relied upon. So we 12 are giving them that. 13 Number 10 asks for evidence of lost 14 income. We are not claiming lost income, so 15 there is no evidence of lost income. That is 16 what they asked for. The answer to that is 17 none. 18 Number 11 again asks for memorandum, 19 diaries, journals, et cetera upon which you 20 rely in support of your claim for punitive 21 damages. Now, what we rely upon in support of 22 our claim for punitive damages is all the 23 evidence with regard to misconduct on the part 24 of the counter-defendant. That has nothing to 25 do with these financial issues. WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103172  1 I skipped over number 9, copies of any 2 and all receipts, reports, invoices or other 3 documents evidencing treatment for your mental 4 anguish, embarrassment, anxiety, as alleged in 5 your counterclaim, there has been no formal 6 treatment, we have already told them none. 7 The last one is copies of any and all 8 documents you intend to introduce at trial 9 support of the allegations made by you in the 10 fourth amended counterclaim. Again, we are 11 giving them all the evidence that we intend to 12 rely upon. 13 So the motion for protective order is 14 directed principally to number 1, number 2, 15 number 3, number 4, as it relates to anything 16 other than attorney's fees awards for Bradley 17 Edwards, and number 5 and the partnership 18 agreement in number 6. 19 So, understanding what we are claiming 20 and the fact that they are entitled to test 21 our claim, the answer to the question Your 22 Honor asks is, yes, they are entitled to test 23 our claim that this is the amount of time that 24 Brad Edwards devoted to the defense of this 25 case, but they haven't asked for anything that WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103173  1 relates to time except to the extent that we 2 have agreed to produce that which relates to 3 time. So I hope I have answered the question 4 for Your Honor. 5 If you take a look at what they really 6 asked for, they haven't asked for anything 7 that is relevant to the one issue that has 8 been identified, and I want to just expand 9 upon the answer a little bit in response to 10 one of the comments that Your Honor made. 11 Mr. Edwards has a choice as to how he is 12 going to use his time every day. He can use 13 it with his family, he can use it in 14 recreation, he can use it for purposes of 15 fulfilling his professional responsibilities, 16 he can sleep, and if as a consequence of the 17 filing of this action Mr. Edwards continued to 18 do everything that he was obliged to do in 19 order to maintain his professional income but 20 he lost time away from his family, he lost 21 recreational time and he gave up sleep in 22 order to be able to fulfill his professional 23 responsibilities, there needs to be some 24 manner in which the jury can assess the value 25 of that lost time, and one way in which to do WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103174  1 it, one reasonable way in which to do it, is 2 to find out what the market value of that time 3 is, which is what is a willing buyer of Mr. 4 Edwards' time willing to pay for that time 5 when Mr. Edwards is willing to make that time 6 available to him, a willing buyer, willing 7 seller, open market, here's the value. 8 That is what we intend to rely on. 9 THE COURT: I'm not sure the value to the 10 wife or the children is the same as the value 11 of an attorney. 12 MR. SCAROLA: Oh, I think it is more, 13 Your Honor. 14 THE COURT: It may be. 15 MR. SCAROLA: I think if we can make that 16 argument, and I intend to, that the value of 17 Mr. Edwards' time with his family is greater 18 than the value is to a client, so that the 19 value to a client establishes a minimum with 20 respect to the value of Mr. Edwards' time, 21 because he is taking it away from his family 22 in order to devote it to his professional 23 practice. 24 It is at least, as the law requires, a 25 reasonable yardstick of measurement. And they WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103175  1 are asking for what we are relying upon. We 2 are giving them what we are relying upon. 3 Thank you, Your Honor. 4 THE COURT: Yes, ma'am. You have the 5 last word. 6 MR. SCAROLA: Actually, I thought it was 7 my motion. 8 THE COURT: It is, but I'm going to givtc 9 her the last word anyway, because you said a 10 lot of other things. 11 MS. COLEMAN: Judge, I rely on our motion 12 and the very clear unequivocal case law upon 13 which we rely in support of our motion, but I 14 would like to say, with respect to the 15 argument Mr. Scarola made about Mr. Edwards' 16 shareholder's agreement or his partnership 17 agreement, his K1 statements from the firm, 18 irrefutably, if Mr. Edwards is, in fact, a 19 shareholder of that firm, if there's a profit- 20 sharing agreement or he is required to bill a 21 certain number of hours, bring in a certain 22 amount of cases, it's clearly germane to the 23 issues in this case, just as it is very 24 germane to all of the issues raised as to 25 quantification of his time. WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103176  31 1 Mr. Edwards could choose sleep all day or 2 not go to work or whatever the activities are 3 that Mr. Scarola pointed out he may choose to 4 do, but if he is making $20 million a month 5 not doing that, how much time has he really 6 lost from work? Clearly, even the best of 7 lawyers can't not go to work all day and eart 8 that kind of money. 9 This income that he makes both in his 10 personal tax returns as well as through his 11 firm is relevant. There are many cases upon 12 which we relied, I printed out all the cases 13 in our motion, where corporate records arc 14 permitted when the person who is claiming 15 these damages makes them an issue. 16 Mr. Edwards has made his finances an 17 issue. Whether through a claim of stolen time 18 or lost time, injury to his reputation or 19 whatever it is, how do you measure injury of 20 reputation to a lawyer? These are things that 21 need to be addressed, and this is the only way 22 to quantify those issues or to see what, if 23 any, damage has been done financially to Mr. 24 Edwards as a result of that. 25 Thank you. WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103177  1 THE COURT: Okay. I will get an order 2 out probably in the next day or so. I have 3 another order pending for you guys, I already 4 have it half written, so it will be out to you 5 in a day or two as well, on clarification of 6 the order on the production. Actually, it 7 will be coming out hot off the presses 8 shortly. 9 MR. SCAROLA: Thank you, Your Honor. 10 (Hearing concluded at 4:35 o'clock, 11 p.m.) 12 13 14 15 16 17 18 19 20 21 22 23 24 25 WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103178  1 CERTIFICATE OF REPORTER 2 3 4 I, Roger Watford, Florida Professional 5 Reporter, certify that I was authorized to and 6 did stenographically report the foregoing 7 proceedings and that the transcript is a true B and complete record of my stenographic notes. 9 10 I further certify that I am not a 11 relative, employee, attorney or counsel of any 12 of the parties, nor am I a relative or 13 employee of any of the parties' attorneys or 14 counsel connected with the action, nor am I 15 financially interested in the action. 16 17 Dated this 20th day of June, 2013. 18 19 20 6// Roger Watford, PR/RPR 21 22 23 24 25 WWW.USLEGALSUPPORT.COM 561-835-0220 EFTA01103179  Page 1 A annoy7:21 award15:10 19:8,20,21 20:24 abbreviate4:14 answer6:2 7:25 awarded24:8 21:9,11,17,19,23 ability13:22 15:19 26:16 awarding15:3 23:5 24:22 27:25 able4:14 14:11 27:21 28:9 awards11:3 12:10 30:12,23 28:22 answered28:3 :2:11 18:20,20 cases9:5,6 13:6 above-styled3:1 anxiety17:15 27:4 18:25 23:24,24 :7,8 22:14 absolutely19:4 anyway4:5 30:9 24:4 27:16 24:9 30:22 31:11 accept11:9 apart 8:16 13:10 31:12 accepts20:11 apologies 4:18,20 casts7:18 accident 9:19,22 appear3:18 back12:2 cause1:20 3:1 acknowledged 7:13 APPEARANCES2:1 background5:25 16:21 17:4 action16:21 17:4 appropriate 7:12 BARNHART 2:9 caused14:9 19:9 21:25 28:17 12:23 22:25 23:1 based5:13 12:2 causes19:9 33:14,15 24:7 14:6 24:15 causing13:24 activities6:17 appropriateness baseless6:12 9:17 certain30:21,21 31:2 7:13 11:17 17:19 certainly11:1 add 8:22 arbitration/me... 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