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`EXHIBIT 11
`EXHIBIT 11
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`IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
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`SECOND APPELLATE DISTRICT, DIVISION ___
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`AMAZON.COM, INC., AMAZON
`WEB SERVICES, INC., and
`TWITCH INTERACTIVE, INC.,
`
`
`Petitioners,
`
`v.
`
`LOS ANGELES COUNTY
`SUPERIOR COURT,
`
`
`Respondent,
`
`
`BRILLIANT DIGITAL
`ENTERTAINMENT, INC.,
`EUROPLAY CAPITAL ADVISORS,
`LLC, CLARIA INNOVATIONS, LLC,
`MONTO HOLDINGS PTY LTD, and
`PERSONALWEB TECHNOLOGIES,
`LLC,
`
`
`Real Parties in Interest.
`
`
`
`
`Appeal from an Order Denying Petitioners’ Motion to Intervene
`Decided Nov. 17, 2021; Entered Nov. 17, 2021
`Hon. Bernie LaForteza, Dept. U, L.A. Cty. Sup.Ct. (818-407-2243)
`Hon. Valerie Salkin as of January 10, 2022 (818-901-4608)
`
`PETITION FOR WRIT OF SUPERSEDEAS;
`MEMORANDUM OF POINTS AND AUTHORITIES
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`
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`1
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`Document received by the CA 2nd District Court of Appeal.
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`Court of Appeal No.
`B_______
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`Superior Court No.
`21VECV00575
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`STAY REQUESTED
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`Document received by the CA 2nd District Court of Appeal.
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`J. David Hadden
`State Bar No. 176148
`Todd R. Gregorian
`State Bar No. 236096
`Christopher S. Lavin
`State Bar No. 301702
`FENWICK & WEST LLP
`555 California Street, 12th Flr.
`San Francisco, CA 94104
`Telephone: 415.875.2300
`Email: dhadden@fenwick.com
`Email: tregorian@fenwick.com
`Email: clavin@fenwick.com
`
`Michael J. Baratz
`(Pro Hac Vice forthcoming)
`Steven Davidson
`(Pro Hac Vice forthcoming)
`STEPTOE & JOHNSON LLP
`1330 Connecticut Avenue, NW
`Washington, D.C. 20036
`Telephone: 202.429.6468
`Email: mbaratz@steptoe.com
`Email: sdavidson@steptoe.com
`
`Counsel for Petitioners
`AMAZON.COM, INC.,
`AMAZON WEB SERVICES,
`INC., AND TWITCH
`INTERACTIVE, INC.
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`CERTIFICATE OF INTERESTED ENTITIES OR PERSONS
`
`Counsel for petitioners certifies that interested entities or
`persons required to be listed under rule 8.208 of the California
`Rules of Court are as follows:
`
`Full name of interested
`entity or person
`Amazon.com, Inc.
`
`Nature of interest
`
`Amazon.com, Inc.
`
`Ownership interest in:
`Amazon Web Services, Inc.
`Ownership interest in:
`Twitch Interactive, Inc.
`
`
`The undersigned certifies that the above-listed persons or
`entities (corporations, partnerships, firms, or any other
`association, but not including government entities or their
`agencies) have either (1) an ownership interest of 10 percent or
`more in the party if it is an entity; or (2) a financial or other
`interest in the outcome of the proceeding that the justices should
`consider in determining whether to disqualify themselves, as
`defined in rule 8.208(e)(2).
`
`Dated: January 14, 2022
`
`
`By: /s/ Todd R. Gregorian
`
`Todd R. Gregorian
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`TABLE OF CONTENTS
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`
`Page
`TABLE OF AUTHORITIES .............................................................7
`PETITION FOR WRIT OF SUPERSEDEAS ............................... 11
`PRAYER ......................................................................................... 12
`VERIFICATION ............................................................................ 13
`MEMORANDUM OF POINTS AND AUTHORITIES ................ 14
`I. INTRODUCTION ....................................................................... 14
`II. STATEMENT OF THE CASE .................................................. 18
`Parties. ....................................................................... 18
`Amazon’s judgment against PersonalWeb. .............. 19
`Insiders’ competing claim against PersonalWeb. .... 20
`Insiders demanded early repayment of their
`investment in PersonalWeb and brought the
`receivership action to evade the federal district court
`judgment, to the prejudice of Amazon. ..................... 21
`Amazon moved unopposed to intervene, which motion
`the Superior Court denied. ........................................ 24
`Amazon moved for a stay before the Superior Court.
`..................................................................................... 25
`Authenticity of exhibits. ............................................ 26
`
`III. BASIS FOR RELIEF ............................................................... 28
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`2.
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`3.
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`IV. MEMORANDUM OF LAW ..................................................... 31
`An automatic statutory stay applies to continued
`proceedings at the Superior Court. ........................... 31
`1.
`None of the statutory exemptions to the
`automatic stay apply. ............................ 31
`The automatic stay prohibits entry of the
`stipulated judgment and any further
`proceedings. ............................................ 33
`Amazon’s writ petition is ripe because the
`Superior Court and Insiders have refused
`to acknowledge the automatic stay. ...... 37
`In the alternative, the Court should exercise its
`discretion to stay the case because the balance of
`hardships favors a stay and the appeal presents
`substantial issues. ..................................................... 38
`1.
`Amazon is more likely to be injured than
`PersonalWeb or Insiders without a stay.
`................................................................. 40
`a.
`Amazon will suffer irreparable
`harm. ............................................ 40
`A balancing of the hardships tips in
`favor of Amazon favoring a stay. 42
`Amazon’s appeal raises substantial
`issues. ..................................................... 44
`a.
`Amazon has a direct, arms’ length
`interest in the PersonalWeb assets.
`....................................................... 44
`
`b.
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`2.
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`b.
`
`Amazon has a valid claim for
`equitable subordination. .............. 46
`Amazon will raise additional substantial arguments
`on appeal .................................................................... 50
`CONCLUSION ............................................................................... 51
`CERTIFICATE OF COMPLIANCE .............................................. 53
`EXHIBITS ...................................................................................... 54
`PROOF OF SERVICE ................................................................... 55
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`TABLE OF AUTHORITIES
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`
`
`FEDERAL CASES
`
`Page(s)
`
`Gen. Ins. Co. v. Lowry,
`570 F.2d 120 (6th Cir. 1978)..................................................... 48
`Pepper v. Litton,
`308 U.S. 295 (1939) ............................................................. 46, 47
`
`CALIFORNIA CASES
`Bank of N.Y. Mellon v. Citibank, N.A.,
`8 Cal. App. 5th 935 (2017), as modified (Mar. 1, 2017) .......... 48
`Chapala Mgmt. Corp. v. Stanton,
`186 Cal. App. 4th 1532 (2010) .................................................. 37
`City of Hollister v. Monterey Ins. Co.,
`165 Cal. App. 4th 455 (2008) .................................................... 31
`Cont’l Vinyl Prods. Corp. v. Mead Corp.,
`27 Cal. App. 3d 543 (1972) ....................................................... 45
`Davis v. Custom Component Switches, Inc.,
`13 Cal. App. 3d 21 (1970) ................................................... 28, 40
`Deepwell Homeowners’ Protective Ass’n v. City Council of
`Palm Springs,
`239 Cal. App. 2d 63 (1965) ....................................................... 39
`Del Conte Masonry Co. v. Lewis,
`16 Cal. App. 3d 678 (1971) ....................................................... 48
`Dowling v. Zimmerman,
`85 Cal. App. 4th 1400 (2001) .................................................... 28
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`Elsea v. Saberi,
`4 Cal. App. 4th 625 (1992) ........................................................ 31
`English v. Olympic Auditorium, Inc.,
`217 Cal. 631 (1933) ................................................................... 48
`Estate of Murphy,
`16 Cal. App. 3d 564 (1971) ..................................... 28, 40, 42, 43
`Feresi v. Livery, LLC,
`232 Cal. App. 4th 419 (2014),
`as modified (Jan. 8, 2015)............................................. 47, 48, 49
`Hoover v. Galbraith,
`7 Cal. 3d 519 (1972) .................................................................. 45
`In re Dabney’s Estate,
`37 Cal. 2d 402 (1951) ................................................................ 37
`In re Marriage of Horowitz,
`159 Cal. App. 3d 377 (1984) ..................................................... 31
`In re Pac. Coast Bldg.-Loan Ass’n of L.A.,
`15 Cal. 2d 134 (1940) ................................................................ 47
`Knox v. Phoenix Leasing Inc.,
`29 Cal. App. 4th 1357 (1994) .............................................. 48, 49
`LAOSD Asbestos Cases,
`28 Cal. App. 5th 862 (2018) ...................................................... 37
`Mills v. Cty. of Trinity,
`98 Cal. App. 3d 859 (1979) ....................................................... 40
`Nicoletti v. Lizzoli,
`124 Cal. App. 3d 361 (1981) ..................................................... 48
`Nielsen v. Stumbos,
`226 Cal. App. 3d 301 (1990) ..................................................... 28
`
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`Pangborn Plumbing Corp. v. Carruthers & Skiffington,
`97 Cal. App. 4th 1039 (2002) .................................................... 48
`People ex rel. S.F. Bay Conservation & Dev. Comm’n v.
`Emeryville,
`69 Cal. 2d 533 (1968) ................................................................ 39
`Scottsdale Ins. Co. v. Super. Ct.,
`No. BC363862, 2011 WL 3629170 (2011) ................................ 32
`Socialist Workers 1974 Cal. Campaign Comm. v. Brown,
`53 Cal. App. 3d 879 (1975) ....................................................... 34
`Sun-Maid Raisin Growers of Cal. v. Paul,
`229 Cal. App. 2d 368 (1964) ..................................................... 42
`Varian Med. Sys., Inc. v. Delfino,
`35 Cal. 4th 180 (2005) ........................................................ passim
`
`STATUTES
`California Code of Civil Procedure § 116.810 ............. 17, 28, 32, 33
`California Code of Civil Procedure § 916 .................... 17, 32, 33, 34
`California Code of Civil Procedure § 916(a) ..................... 28, 31, 32
`California Code of Civil Procedure §§ 917.1
`through 917.9 ............................................................ 7, 28, 31, 32
`California Code of Civil Procedure Section 923 ............... 17, 38, 39
`
`RULES
`Federal Rule of Civil Procedure 62(a) ........................................... 20
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`OTHER AUTHORITIES
`3 Cal. Real Est. Digest 3d Liens § 9 (June 2021), Priorities ....... 49
`42A Cal. Jur. 3d Liens §§ 45, 48 ................................................... 49
`Eisenberg et al., Cal. Practice Guide:
`Civil Appeals and Writs (The Rutter Group 2013) ..... 32, 34, 37
`Patricia Redmond et al., Scary Nightmares for Secured
`Lenders, American Bankruptcy Institute Concurrent
`Session at 258–59 (July 18, 2013) ............................................ 46
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`PETITION FOR WRIT OF SUPERSEDEAS
`Petitioners Amazon.com, Inc., Amazon Web Services, Inc.,
`and Twitch Interactive, Inc. (collectively, “Amazon”) seek a writ
`of supersedeas directing the respondent Los Angeles County
`Superior Court to stay the case pending the resolution of
`Amazon’s appeal of the order denying its motion for leave to
`intervene.
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`PRAYER
`Amazon prays that a writ of supersedeas issue from this
`Court commanding the Superior Court to order a stay:
`(i)
`precluding the entry of the proposed stipulated
`judgment before the Superior Court (or any other
`final judgment) among real parties in interest
`Brilliant Digital Entertainment, Inc. (“BDE”),
`Europlay Capital Advisors, LLC (“ECA”), Claria
`Innovations, LLC (“Claria”), Monto Holdings Pty Ltd
`(“Monto”) (collectively, “Insiders”), and PersonalWeb
`Technologies, LLC (“PersonalWeb”);
`barring disbursement of any of PersonalWeb’s assets
`to the Insiders; and
`(iii) precluding any other management of the
`PersonalWeb estate by the receiver that would favor
`Insiders as creditors over Amazon;
`all pending the resolution of Amazon’s appeal of the Superior
`Court’s order denying Amazon’s motion for leave to intervene to
`protect its interests in the PersonalWeb estate.1
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`(ii)
`
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`1 Amazon does not seek a stay of other activities by the receiver,
`such as the receiver taking prudent steps to marshal assets to
`benefit all creditors or requesting receiver’s certificates. Amazon
`already requested this relief twice before the Superior Court,
`which denied it and refused to consider a renewed request on a
`timely basis but instead instructed Amazon to notice a hearing
`for late April 2022.
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`VERIFICATION
`I am counsel for Petitioners, am over the age of 18, and
`have read this Petition for Writ of Supersedeas; Memorandum of
`Points and Authorities and know its contents. I make this
`verification because I am familiar with the proceedings giving
`rise to this Petition.
`I either know the Petition’s allegations to be true or believe
`them to be true based on the documents in the accompanying
`Exhibits. The Exhibits are true and correct copies of documents
`filed or lodged in Respondent Los Angeles County Superior Court
`relating to the Order Denying Petitioners’ Motion to Intervene in
`Brilliant Digital Entertainment, Inc., et al. v. PersonalWeb
`Technologies, LLC, L.A. Cnty. Superior Court No. 21VECV00575,
`entered on November 17, 2021, which is the subject of this
`Petition.
`I declare under penalty of perjury under the laws of the
`State of California that the foregoing is true and correct and that
`this verification was executed on January 14, 2022, at San
`Francisco, California.
`
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`By: /s/ Todd R. Gregorian
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`Todd R. Gregorian
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`MEMORANDUM OF POINTS AND AUTHORITIES
`I.
`INTRODUCTION
`This dispute concerns the assignment of priority for the
`competing claims Amazon and Insiders have asserted against
`PersonalWeb. Amazon holds a $5.4 million judgment for
`attorney fees and costs against PersonalWeb awarded based on
`PersonalWeb’s misconduct in filing and pursuing more than 80
`baseless patent lawsuits against Amazon customers. Insiders
`allege that they possess $19 million in demand instruments for
`funds which they lent PersonalWeb in-part to fund those abusive
`patent litigations and in the hope of extorting settlement payoffs
`from Amazon’s customers.
`Insiders are the beneficial owners of PersonalWeb and
`share overlapping management. They have amended and
`restated their alleged demand instruments multiple times over
`the course of a decade, and, based on the most recent
`restatement, those instruments did not mature until December
`31, 2022. But as soon as the federal district court awarded
`Amazon its fees and costs, the Insiders filed the Superior Court
`action and moved for a preliminary injunction and order
`establishing a receivership over PersonalWeb exclusively for their
`benefit and to the detriment of any other PersonalWeb creditors
`like Amazon. PersonalWeb, for its part, colluded with the
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`Insiders to establish the receivership and avoid paying the
`judgment it owes—it used Insiders’ own lawyers to submit a
`declaration to the court consenting immediately to the
`receivership. Neither the complaint nor any of Insiders’ other
`filings at the Superior Court disclosed that Amazon is a creditor
`of PersonalWeb or that the ultimate beneficial owners of
`PersonalWeb are the same as the ultimate beneficial owners of
`Insiders.2
`This is a profoundly inequitable result. It is axiomatic that
`arms’ length creditors like Amazon are to be paid before owners
`like Insiders. The Insiders have alleged (and Amazon agrees)
`that their $19 million demand exhausts PersonalWeb’s current
`estate many times over, and it will therefore defeat entirely
`Amazon’s ability to collect the judgment. And since obtaining the
`receivership, the Insiders have used it to shield new payments to
`PersonalWeb to pay its lawyers for more litigation against
`Amazon, Amazon’s customers, and other technology companies
`like Google and Facebook. This is but the latest chapter in what
`the federal district court described as PersonalWeb’s “chameleon-
`
`
`2 For example, Amazon has alleged that Claria owned 99% of
`PersonalWeb and had governing authority of PersonalWeb, at
`PersonalWeb’s formation (Ex. 13 at 229-230); Monto owns 20% of
`PersonalWeb (Id. at 246); the founder of BDE was Mr.
`Bermeister, the Non-Executive Chairman of PersonalWeb (Exs.
`14–16); and the former chair and CEO of BDE, Mr. Bermeister’s
`cousin Mark Dyne, founded ECA. (Exs. 16–18).
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`like efforts” to “thwart collection of the judgment ordered by this
`Court.” (Ex. 8 at 143–144.)
`Amazon moved for leave to intervene below to enforce its
`judgment against PersonalWeb and establish priority to Insiders,
`alleging causes of action for judgment enforcement, equitable
`subordination, and equitable accounting. Amazon meets the
`legal standard to intervene and have its claims heard and
`decided on the merits: (1) as a judgment creditor, Amazon has a
`direct and fundamental interest in the PersonalWeb estate; (2)
`the disposition of the receivership action will affect that interest
`because it fully disposes of that estate; and (3) the current
`parties, Insiders—who procured the receivership at best through
`collusion with PersonalWeb and at worst through an outright
`fraud on the court, and who are using it to continue
`PersonalWeb’s patent litigation business while defeating
`Amazon’s attempt to collect the judgment—cannot possibly
`“represent” Amazon’s interest. Nevertheless, the Superior Court
`denied Amazon’s unopposed motion for leave to intervene, which
`Amazon now appeals.
`In the meantime, Insiders and PersonalWeb have filed a
`stipulated judgment seeking to make the receivership in favor of
`Insiders permanent. This stipulated judgment remains pending
`and, once the Superior Court enters it, the path is paved to make
`permanent the management of the PersonalWeb estate to benefit
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`only the Insiders, including the dissipation of PersonalWeb’s
`current assets to fund continued litigation against Amazon itself.
`Moreover, both Mr. Bermeister at least one of the Insiders are
`based abroad, meaning that any assets transferred into their
`control may be placed outside the jurisdiction of the Court where
`they are effectively unrecoverable.
`As explained below, Amazon requests that the Court grant
`its petition for writ of supersedeas for a limited stay of the
`Superior Court action. The Court should impose an automatic
`stay, because the order denying Amazon’s motion for leave to
`intervene does not fall within any of the enumerated exceptions
`to the Section 916 automatic stay listed in Code of Civil
`Procedure Sections 917.1 through 917.9 and 116.810 and that
`order “embraces” or “affects” both the ongoing management of the
`receivership as well as any final judgment between PersonalWeb
`and the Insiders. Alternatively, if the Court determines that an
`automatic stay does not apply, Amazon requests that the Court
`exercise its discretion to stay the action under Code of Civil
`Procedure Section 923, because the balance of hardships weighs
`in Amazon’s favor and the appeal presents substantial issues.
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`II.
`STATEMENT OF THE CASE
`
` Parties.
`Petitioner Amazon.com, Inc. is a Delaware
`1.
`corporation with offices and employees throughout several of the
`United States, including the County of Los Angeles. (Ex. 19 at
`304 ¶ 1.)
`Petitioner Amazon Web Services, Inc. is a wholly-
`2.
`owned subsidiary of Amazon.com, Inc. (Id. ¶ 2.)
`Petitioner Twitch Interactive, Inc. is a wholly-owned
`3.
`subsidiary of Amazon.com, Inc. (Id. ¶ 3.)
`Respondent BDE is a Delaware corporation with its
`4.
`principal place of business in the County of Los Angeles. (Ex. 1
`at 9 ¶ 1.)
`Respondent ECA is a Delaware corporation with its
`5.
`principal place of business in the County of Los Angeles. (Id. at
`10 ¶ 2.)
`Respondent Claria is a Delaware limited liability
`6.
`company with its principal place of business in the County of Los
`Angeles. (Id. ¶ 3.)
`Respondent Monto is an Australian limited
`7.
`partnership with its principal place of business in New South
`Wales, Australia. (Id. ¶ 4.)
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`Respondent PersonalWeb is a limited liability
`8.
`company duly organized and existing under the laws of Texas
`and doing business in the County of Los Angeles, with its
`principal place of business at 112 E. Line Street, Suite 204, Tyler,
`TX 75702. (Ex. 19 at 304 ¶ 8.)
` Amazon’s judgment against PersonalWeb.
`In 2018, PersonalWeb filed 85 patent infringement
`9.
`lawsuits against Amazon customers in courts nationwide.
`Amazon intervened to defend its customers and filed a
`declaratory judgment suit against PersonalWeb seeking an
`injunction and declarations of claim and Kessler preclusion and
`non-infringement. (Ex. 7 at 129.) The federal Judicial Panel on
`Multidistrict Litigation centralized the suits in a multidistrict
`litigation proceeding in the United States District Court for the
`Northern District of California. Once there, Amazon moved for
`summary judgment of claim and Kessler preclusion, which the
`federal district court granted-in-part. (Id.) Amazon then moved
`for summary judgment of non-infringement as to all remaining
`claims, which the federal district court granted in February 2020.
`(Id.)
`10. The United States Court of Appeals for the Federal
`Circuit has affirmed both rulings. PersonalWeb has sought
`review by the United States Supreme Court of the first ruling on
`preclusion, but any further review of that issue is of no practical
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`consequence for the outcome given the later non-infringement
`ruling.
`In March 2020, Amazon—as the prevailing party—
`11.
`moved for attorney fees and costs. (Id.) The federal district court
`held that PersonalWeb brought baseless claims, submitted
`inaccurate declaration testimony, and engaged in other
`unreasonable conduct throughout the case. (Ex. 9 at 152–158.)
`On March 2, 2021, the federal district court awarded Amazon
`$4,615,242.28 in fees and $203,300.10 in non-taxable costs
`against PersonalWeb for work performed until February 2020,
`and on April 19, 2021, it awarded Amazon another $571,961.71 in
`fees and $11,120.97 in costs for work performed between
`February 2020 and February 2021. (Exs. 10–12.) This is
`$5,403,122.68 in attorney fees and costs and accrued interest.
`12. Each order awarding fees became a fully enforceable
`final judgment against PersonalWeb 30 days after it issued, as
`PersonalWeb failed to post a supersedeas bond under Federal
`Rule of Civil Procedure 62(a). (Ex. 12.)
`Insiders’ competing claim against PersonalWeb.
`
`Insiders include the principals and beneficial owners
`13.
`of PersonalWeb. They have characterized their equity
`investments in PersonalWeb as secured debt in an amount of
`around $19 million. PersonalWeb pledged all of its tangible and
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`intangible assets as collateral for these purported “loans.” (Ex. 1
`at 10 ¶ 7; 15–19 ¶¶ 12, 16, 20–21, 27.)
`14. The four instruments that support the Insiders’
`claims first issued in August 2010 (Claria), February 2011 (ECA),
`October 2011 (BDE), and May 2012 (Monto). (Id. at 10 ¶ 7; 15–17
`¶¶ 12, 16, 20.) The security agreements pledging “all of
`[PersonalWeb’s] tangible and intangible assets” as collateral
`issued in May 2012 (Monto and BDE) and March 2014 (ECA and
`Claria). (Ex. 2 at 47 ¶ 3; Ex. 1 at 11–18 ¶¶ 10, 15, 19, 24–25.)
`15. All four instruments were amended and restated
`regularly, most recently on December 31, 2019. (Ex. 1 at 10 ¶ 7;
`15–17 ¶¶ 12, 16, 20.) This latest amendment and restatement
`was the fourth for BDE and Monto, and the third for ECA and
`Claria. (Id.) The maturity date for all four, which collectively
`total about $19 million, was December 31, 2022. (Id. at 10 ¶¶ 7;
`15–19 ¶¶ 12, 16, 20–21, 27.)
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`Insiders demanded early repayment of their
`investment in PersonalWeb and brought the
`receivership action to evade the federal district
`court judgment, to the prejudice of Amazon.
`16. On April 27, 2021, Insiders filed a complaint in
`Superior Court seeking to have PersonalWeb enter receivership
`exclusively to benefit Insiders.
`17. Although their purported “loans” did not mature
`until December 31, 2022, and they had just amended and
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`restated them on December 31, 2019, Insiders demanded
`payment of the $19 million in full “prior to the institution of th[e]
`action.” (Ex. 1 at 18 ¶ 26.) Insiders did not specify the date of the
`demand in their complaint, but state the amounts due as of
`March 31, 2021—thus, the reasonable inference to draw from
`Insiders’ silence (and the accelerated demand less than halfway
`through the term of loans amended and restated multiple times
`over the course of nearly a decade) is that the demand occurred
`between the federal district court’s March 2, 2021 award of
`millions of dollars of fees and costs to Amazon and March 31,
`2021. (Ex. 7 at 130.)
`18. Amazon alleges that real parties in interest BDE,
`ECA, Claria, and Monto are insiders, with the same beneficial
`owner as PersonalWeb: Claria owned 99% of PersonalWeb, and
`had governing authority of PersonalWeb, when PersonalWeb was
`formed (Ex. 13 at 229-230); Monto owns 20% of PersonalWeb (Id.
`at 246); the founder of BDE was Mr. Bermeister, the Non-
`Executive Chairman of PersonalWeb (Exs. 14–16); and the
`former Chairman and CEO of BDE, Mr. Bermeister’s cousin
`Mark Dyne, founded ECA. (Exs. 16–18).
`19. On May 3, 2021, Insiders moved for an order
`appointing a receiver, which the Superior Court granted a week
`later. (Exs. 3–4.) The court’s order directs the receiver to
`manage PersonalWeb’s assets exclusively to benefit Insiders.
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`(See id. at 86 ¶ 1 (enabling the Receiver to “seize, manage,
`control, operate, and collect all of the collateral of [Insiders] (i.e.,
`all of [PersonalWeb’s] personal property assets) . . . as the
`Receiver deems necessary for the property retention,
`management, administration, and/or liquidation of the
`Collateral”).)
`20. On May 20, 2021, Insiders moved for a preliminary
`injunction, which the court entered on June 1, 2021. (Ex. 5; Ex. 6
`(“Preliminary Injunction”).) The Preliminary Injunction also
`orders the Receiver to manage PersonalWeb assets only to benefit
`Insiders. (Id. at 120, clause (f) (barring the Receiver and all
`others from “[d]iverting in any way any of the proceeds from
`Plaintiffs’ Collateral including without limitation accounts,
`accounts receivable, general intangibles, payment intangibles,
`equipment, and/or inventory”); id. at 120–121, clause (h) (barring
`the Receiver and all others from “[f]ailing or refusing to
`immediately turn over to the Receiver Plaintiffs’ Collateral and
`all monies, checks, funds, or proceeds relating to Plaintiffs’
`Collateral”).)
`21. The unusually expedited schedule of the Superior
`Court action—a little over a month between the initiation of the
`case and the establishment of the receivership—would not have
`been possible without PersonalWeb’s collusion, in the form of (a)
`its immediate concession that it owed a $19 million debt to
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`Insiders which it could not pay, (b) its statement in a declaration
`filed by Insiders’ own attorneys that “the best course of action
`with respect to the collateral is for the Receiver immediately to
`take possession” of it, Ex. 2 at 47 ¶¶ 2–4, and (c) its blanket
`consent to the appointment of the receiver and the entry of the
`preliminary injunction.
` Amazon moved unopposed to intervene, which
`motion the Superior Court denied.
`22. On August 10, 2021, Amazon sought to intervene as a
`plaintiff-creditor because it has an interest in the property
`involved in the litigation (the assets in the PersonalWeb estate)
`and is so situated that any judgment rendered in its absence,
`prioritizing the claims of Insiders over its $5.4 million judgment
`against PersonalWeb, will impair Amazon’s ability to protect that
`interest. (Ex. 7.)
`23. On August 19, 2021, Insiders filed a statement of
`non-opposition to Amazon’s motion for leave to intervene. (Ex.
`20.) There was no opposition to Amazon’s motion for leave to
`intervene filed by any party including the receiver.
`24. The reason for Insiders’ non-opposition to the motion
`became clear soon after—they intended to obtain a final
`judgment in their favor before Amazon’s request to intervene
`could even be heard. On August 27, 2021, Insiders (acting at the
`direction of Mr. Bermeister and members of his family) and
`PersonalWeb (also acting at the direction of Mr. Bermeister along
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`with Mr. Weiss) continued their collusion by filing a stipulation
`for entry of judgment for Insiders against PersonalWeb. (Ex. 21.)
`The stipulated judgment purports to finalize the receivership,
`and states that “[j]udgment shall be entered immediately in this
`action” in favor of the Insiders against PersonalWeb in an
`amount totaling over $19 million (representing 100% of Insiders’
`claims rather than any arms’ length compromise). (Id. at 316)
`25. On November 17, 2021, the Superior Court denied
`Amazon’s unopposed motion for leave to intervene, finding
`“Amazon’s motion does not show a sufficient interested [sic] in
`the current litigation to justify this Court granting intervent