Montgomery V Risen # 94 - S.D.Fla. - 1-15-cv-20782 - 94 - D Memo of Law Re 91

Case 1:15-cv-20782-JEM Document 94 Entered on FLSD Docket 08/04/2015 Page 1 of 7
UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF FLORIDA
Case No. 15-cv-20782-MARTINEZ/GOODMAN
DENNIS MONTGOMERY,
Plaintiff,
v.
JAMES RISEN et al.,
Defendants.
________________________/
DEFENDANTS PRE-HEARING MEMORANDUM
HOLLAND & KNIGHT LLP

Sanford L. Bohrer
Sandy.Bohrer@hklaw.com
Brian W. Toth
Brian.Toth@hklaw.com
701 Brickell Avenue, Suite 3300
Miami, Florida 33131
Tel: (305) 374-8500
Fax: (305) 789-7799
DAVIS WRIGHT TREMAINE LLP

Laura R. Handman (admitted pro hac vice)
laurahandman@dwt.com
Micah J. Ratner (admitted pro hac vice)
micahratner@dwt.com
1919 Pennsylvania Ave., NW, Suite 800
Washington, D.C. 20006
Tel.: (202) 973-4200
Fax: (202) 973-4499
Counsel for Defendants
Under the Courts July 20, 2015 order (ECF No. 91), Defendants file this pre-hearing
memorandum on the discovery dispute over the adequacy of Plaintiffs responses, objections,
and production to Defendants first set of interrogatories and requests for production. 1 The
parties have conferred on three occasions about this dispute.
1. The Court Should Order Plaintiff to Produce the Relevant Software and Related
Information over Plaintiffs Objection that the Material Is Classified
This is a libel action Plaintiff brought against author James Risen, his publisher, and its
holding company, arising from statements in Chapter 2 (Chapter) of Risens book, Pay Any
Price: Greed, Power, and the Endless War (the Book), that report allegations Plaintiff
defrauded the federal government by selling it useless software. 2 To defend against Plaintiffs
claim that statements in the Book are false because the software allegedly works, Defendants
requested a copy of the software, government tests that Plaintiff alleges validated the software,
the softwares current location, and other information about the software. 3 Plaintiff refuses to
produce this software and related information, even under the protective order, and even after
being provided the authority set forth herein (see Exhibit 1, attached hereto), asserting that he is
not legally permitted to produce secret classified information. 4
As the non-producing party, Plaintiff bears the burden to justify withholding the software
and related information. 5 But Plaintiff fails to support his objection with any specific basis
Additional disputes over the adequacy of Plaintiffs responses to discovery will be addressed at
the hearing.
2
(ECF No. 44, Am. Compl. 120-27, 181-84, 202-21, 230-36.)
3
(ECF No. 90-1, Defs. Interrogs. 9-15 & Reqs. for Produc. 7-15, 26-32, 36-47, 53.) On August
3, Defendants identified to Plaintiff an expert qualified to test the software, and thus complied
with the scheduling order (ECF No. 48) to the extent possible given Plaintiffs failure to produce.
4
(ECF No. 90-2, Pl.s Resp. & Objections to Interrogs. 9-15) (objecting that the interrogatory calls
for information some of which the Plaintiff is not legally permitted to disclose as being confidential
or secret); (Id., Pl.s Resp. & Objections to Reqs. for Produc. 7-15, 26-32, 36-47, 53) (objecting on
grounds of legal restrictions on the Plaintiff responding or that he is not legally permitted to
disclose all documents or information).
5
Adelman v. Boy Scouts of Am., 276 F.R.D. 681, 689 (S.D. Fla. 2011) (Goodman, J.) (As the
party resisting discovery, [the non-producing party] has the burden to demonstrate specifically
1
required under Local Rule 26.1(g)(3)(A), identifying no contract, order, or other source that
prohibits him from turning over this material. Such a generalized assertion that material sought
in discovery is classified is insufficient. 6
Moreover, orders in Plaintiffs previous cases show that his software is not classified and
he must produce it. In a case in which Plaintiffs former employer, eTreppid, sued Plaintiff for
allegedly misappropriating the subject software, the U.S. government moved for and obtained a
protective order under the state secrets privilege to protect classified information from discovery
(U.S. Protective Order). 7 The U.S. Protective Order, specifically excluded Plaintiffs software
from its scope, stating that [t]his Order does not preclude the Parties from serving or taking any
discovery . . . relating to . . . [t]he computer source code, software, programs, or technical
specifications relating to any technology owned or claimed by any of the Parties. 8 Thus, the
magistrate judge found that [t]he clear understanding in drafting and issuing th[e] [U.S.]
protective order was that the parties would be discussing the nature and capabilities of the
technology, and the type of work each party performed for the government. 9
Nonetheless, Plaintiff refused to produce the software and related information in both the
Nevada litigation and in his later bankruptcy proceedings in which the U.S. Protective Order was
also entered. In the Nevada action, the magistrate and district judges repeatedly ordered Plaintiff
how the request is unreasonable or not relevant.).

6
See Lyondell-Citgo Ref., LP. v. Petroleos De Venezuela, S.A., 2005 WL 356808, at *3
(S.D.N.Y. Feb. 15, 2005) (affirming order compelling production of purportedly classified board
minutes, reports, and presentations despite partys claim that doing so would violate criminal
law, because sustain[ing] an objection on the basis of general statements would give the
government-related party an unfair advantage over its adversary); Roule v. Petraeus, 2012 WL
2367873, at *7 (N.D. Cal. June 21, 2012) (denying the Governments general objection to
Plaintiff's discovery requests . . . that the classified information is not discoverable or used in
civil cases such as this one) (citation omitted).
7
(Montgomery v. eTreppid Technologies, Inc., 3:06-cv-00056-PMP-VPC (eTreppid), ECF No.
253 (D. Nev. Aug. 29, 2007), attached hereto as Exhibit 2.)
8
(Id., at 2-3, 4(c).)
9
(eTreppid, ECF No. 645, at 6 n.3, attached hereto as Exhibit 3.)
2
to produce the software, but he refused. 10 Thus, the district judge held Plaintiff in contempt,
imposing a penalty of $2,500 per day until he produced the software. 11 Instead of producing the
software, Plaintiff settled the action and signed confessions of judgment for $25 million. 12 Then,
Plaintiff declared bankruptcy and continued to refuse to produce or describe the software in
bankruptcy. 13 The Court should not permit him to withhold the software again, especially when
it is central to his burden to prove falsity and Defendants defense on that element. 14
Even if the software and related materials were classified, only the government, not a
private party such as Plaintiff, may invoke the state secrets privilege to prevent disclosure of
classified information. 15 Despite having notice, the government has not intervened here to assert
the state secrets privilege. 16 The Court should order Plaintiff to produce the software and related
information and warn him of the consequences if he fails to comply. 17
10
11
12
13
(Id., ECF No. 645, & eTreppid, ECF Nos. 728, 765, 769, attached hereto as Exhibit 4.)
(eTreppid, ECF No. 815, at 3-5, attached hereto as Exhibit 5.)
(eTreppid, ECF Nos. 897, 898, attached hereto as Exhibit 6.)
In his bankruptcy case deposition, Plaintiff either testified that he did not have the software or
it was subject to the U.S. Protective Order, or he refused to testify under the Fifth Amendment
privilege against self-incrimination. (In re Dennis and Brenda Montgomery, 2:10-bk-18510-BB,
Dep. Tr. 61:10-62:15; 79:7-80:5; 193:10-194:24; 234:3-22; 267:20-269-17; 333:16-21 (Bankr.
C.D. Cal.), relevant excerpts attached hereto as Exhibit 7.) Department of Justice (DOJ)
lawyers who attended his deposition, however, did not object to the questions under the U.S.
Protective Order. Ultimately, Plaintiff was denied discharge in bankruptcy. (eTreppid, ECF
Nos. 1206, 22, 1208, 22, attached hereto as Exhibit 8.)
14
Philadelphia Newspapers, Inc. v. Hepps, 475 U.S. 767, 776-77 (1986).
15
E.g., United States v. Reynolds, 345 U.S. 1, 7 (1953) (The [state secrets] privilege belongs to
the Government and must be asserted by it; it can neither be claimed nor waived by a private
party.); (Ex. 2, U.S. Protective Order, ECF No. 253, at 4, 8) (same).)
16
Counsel for Defendants notified attorneys at DOJ who previously intervened to assert the state
secrets privilege in Plaintiffs past cases about his objections and responses to discovery, this
discovery hearing, and his deposition scheduled for August 20.
17
If Plaintiff does not produce the software and related information critical to Defendants defense,
an award of attorneys fees would not suffice because Plaintiff says he is destitute and fees would
not compensate for Defendants inability to test the software and rebut the self-serving claim that it
works. The most appropriate remedy if the software is not produced: dismissal, since Plaintiff
could not, as a matter of law, carry his burden of proving falsity, and Defendants could not fully
defend, without the allegedly classified information. See, e.g., Trulock v. Lee, 66 F. Appx 472,
476-77 (4th Cir. 2003) (per curiam) (affirming dismissal of libel action brought by former official
represented by Mr. Klayman because classified information subject to state secrets privilege was
central to the element of falsity and defense of truth); Restis v. Am. Coal. Against Nuclear Iran,
Inc., 2015 WL 1344479, at *5-8 (S.D.N.Y. Mar. 23, 2015) (dismissing libel action based on
3
2. The Court Should Compel Production of Material Relevant to Plaintiffs Domicile

Plaintiff may not withhold information about his alleged domicile in Florida, such as his
purported lease in Florida and the location of his bank and credit card accounts, when domicile is
relevant to Defendants pending motion to dismiss or transfer for lack of personal jurisdiction,
improper venue, and convenience under 28 U.S.C. 1404(a), and to damages. 18 Defendants request
proof of Plaintiffs domicile particularly because his and his counsels credibility on such matters is
questionable. 19 Indeed, evidence suggests Plaintiff continues to live in Washington. On February
23, 2015 the same day he registered to vote in Florida from Washington, Plaintiff appeared
telephonically from Washington before a U.S. Tax Court judge in Los Angeles and led the court to
believe he lived in Washington. 20 On February 24 (the very next day), he filed suit here claiming to
be a Florida citizen. On May 13, 2015, Plaintiffs counsel in his criminal prosecution in Nevada for
allegedly passing bad checks obtained a continuance by representing that Plaintiff was ill and in
Washington. 21 And although Plaintiff asserts he is under constant medical care the basis for the
accelerated discovery and trial schedule all his doctors are in Washington. 22
statements by organization accusing plaintiff of violating Iran sanctions because litigating the case
would disclose states secrets). See also Fed. R. Civ. P. 37(b)(2)(A)(i)-(vii); Lyondell-Citgo Ref., LP
v. Petroleos de Venezuela, S.A., 2005 WL 1026461, at *4 (S.D.N.Y. May 2, 2005) (affirming
adverse inference instruction against party refusing to produce allegedly classified information
under court order).
18
Soghanalian v. Soghanalian, 693 F. Supp. 1091, 1093 (S.D. Fla. 1988) (explaining that the
entire course of conduct is relevant to domicile, including lease of property and location of
checking account); Jaisinghani v. Capital Cities/ABC, Inc., 973 F. Supp. 1450, 1453 (S.D. Fla.
1997) (among other factors are home ownership, drivers license, voting registration, location
of family, location of business and where taxes are paid).
19
A federal judge found Plaintiff committed perjury in a declaration opposing a motion for attorneys fees when he argued that California, not Nevada, was the proper forum to resolve the fee
dispute. Montgomery v. eTreppid Techs., LLC, 2010 WL 1416771, at *16 (D. Nev. Apr. 5, 2010).
The Middle District of Florida recently found that Plaintiffs counsel misrepresented the basis for
venue in [that] case, and transferred the case to D.C. (Freedom Watch v. Dept of State, No. 1:14cv-01832-JEB, ECF No. 35, at 8 (M.D. Fla. Oct. 27, 2014), attached hereto as Exhibit 9.)
20
(Montgomery v. Commissioner of the IRS, No. 9008-09, Tr. 34:21-35:6; 37:11-22 (U.S. Tax
Court Feb. 23, 2015), relevant excerpts attached hereto as Exhibit 10.)
21
(State of Nevada v. Montgomery, No. C-268764, Tr. 1:17-21 (Nev. D. Ct., Clark Cnty.
May 13, 2015), attached hereto as Exhibit 11.)
22
(ECF No. 90-2, Pl.s Resp. to Interrog. 22, at 24.) In re Lordy, 214 B.R. 650, 662 (Bankr. S.D.
4
3. The Court Should Compel Production of Relevant Unproduced Medical Records

Plaintiff did not produce medical records before 2011 or evidence of current medical
treatment after April 2015. These documents are relevant to his claim that the Book aggravated
his pre-existing medical condition and caused him emotional damages, his claim of imminent
risk of death to obtain an accelerated schedule, and his claim of domicile in Florida. 23 The Court
should compel him to produce outstanding relevant medical evidence or execute a release. 24
4. The Court Should Compel Production of Relevant Unproduced Tax Returns
In this Circuit, tax returns need only be arguably relevant to obtain them in discovery. 25
Tax returns are relevant to Plaintiffs claimed economic loss. 26 Plaintiff refused to produce federal
tax returns from 2008-14, state returns from 2003-14, and any of his trusts tax returns claiming he
did not possess them. But [t]he Plaintiff has control over his past tax returns even if he does not
have actual possession of the returns; he can obtain his past returns from the IRS and state
authorities. 27 The Court should compel him to produce tax records in his control or execute a
release (see note 24).
Fla. 1997) (location of the persons doctors is domicile factor).

23
E.g., Anderson v. City of Naples, 2010 WL 4853916, at *2 (M.D. Fla. Nov. 22, 2010) (requiring
plaintiff to disclose medical history for the past ten years particularly when Plaintiffs medical
records are highly relevant to . . . claims of aggravation of prior injury).
24
Plaintiff refused to sign medical and tax return release authorizations. While this Court has
required a party to first serve a third-party subpoena and then move for an order compelling the
opposing party to execute a release, Frasca v. NCL (Bahamas) Ltd., 2013 WL 2646839, at *2
(S.D. Fla. June 12, 2013) (Goodman, J.), given that Plaintiffs deposition is currently scheduled for
August 20 to meet the expedited discovery schedule and given that these third parties will inevitably require Plaintiff to sign a release under HIPAA and the IRS Code, Defendants respectfully
request that this Court follow cases that almost universally hold, explicitly or implicitly, that Rule
34, along with Rule 37, empowers federal courts to compel parties to sign written authorizations
consenting to the production of various documents that are within Plaintiffs control. Lischka v.
Tidewater Servs., Inc., 1997 WL 27066, at *2 (E.D. La. Jan. 22, 1997) (collecting cases) (cited in
Frasca).
25
Maddow v. Procter & Gamble Co., 107 F.3d 846, 853 (11th Cir. 1997); Coach, Inc. v. Swap
Shop, Inc., 2013 WL 4407064, at *2 (S.D. Fla. Aug. 13, 2013).
26
E.g., Young Apartments, Inc. v. Town of Jupiter, Fla., 2006 WL 5849319, at *3 (S.D. Fla. Dec.
1, 2006).
27
Hernandez v. Wilsonart Intl, Inc., 2010 WL 2653223, at *2 (M.D. Fla. July 2, 2010)
(compelling plaintiff to produce tax returns he did not possess).
5
Certificate of Good-Faith Conference;

Conferred But Unable to Resolve the Issues Presented in the Motion
In accordance with Local Rule 7.1(a)(3)(A), the undersigned certifies that Defendants
counsel has conferred with all parties or non-parties who may be affected by the relief sought in
this motion in a good-faith effort to resolve the issues but has been unable to resolve the issues.
s/Brian W. Toth
Dated: August 4, 2015
Respectfully submitted,
s/Brian W. Toth
Sanford L. Bohrer
Florida Bar No. 160643
sbohrer@hklaw.com
Brian W. Toth
Florida Bar No. 57708
brian.toth@hklaw.com
HOLLAND & KNIGHT LLP
701 Brickell Avenue, Suite 3300
Miami, Florida 33131
Telephone: (305) 374-8500
Fax: (305) 789-7799
and
Laura R. Handman (admitted pro hac vice)
laurahandman@dwt.com
Micah J. Ratner (admitted pro hac vice)
micahratner@dwt.com
DAVIS WRIGHT TREMAINE LLP
1919 Pennsylvania Ave., NW, Suite 800
Tel.: (202) 973-4200
Fax: (202) 973-4499
Counsel for Defendants
CERTIFICATE OF SERVICE
I certify that on August 4, 2015, I filed this document with the Clerk of Court using
CM/ECF, which will serve this document on all counsel of record.
s/Brian W. Toth
Case 1:15-cv-20782-JEM Document 94-1 Entered on FLSD Docket 08/04/2015 Page 1 of 3
EXHIBIT 1

Shapiro, Marni
From:
Sent:
To:
Cc:
Subject:
Attachments:
Ratner, Micah
Friday, July 24, 2015 6:05 PM
Larry Klayman (leklayman@gmail.com)
laurahandman@dwt.com; Sandy.Bohrer@hklaw.com; Brian.Toth@hklaw.com
Meet and confer follow-up
Protective Order Aug. 29, 2007.pdf; Order on motion to compel source code, ECF
645.pdf; Judge Pro's order affirming order compelling production of source code, ECF
728.pdf; Order Denying Stay and Requiring Production of Source Code, ECF 765.pdf;
OTC on producing source code, ECF No. 769.pdf; Order imposing monetary penalty for
non-production of source code, ECF No. 815.pdf
Larry,
Im writing to follow up on our Tuesday, July 22, 2015 meet and confer call. You said you would double-check a
number of interrogatories and document requests that you did not fully respond to and would let us know the results in
a day or two. We have not heard back from you. Please respond with the results of your search as soon as possible.
U.S. Protective Order and Orders to Produce the Software
In our call on Tuesday, I told you that Mr. Montgomerys software is not covered by the U.S. protective order
(ECF 253), later orders in the Nevada litigation required Mr. Montgomery to produce his software (ECF 645, 728, 765,
769), and that court held him in contempt and required him to pay penalties until he produced the software (ECF No.
815). You asked me to send you those orders. They are attached.
These orders mean that Mr. Montgomerys software is not classified and he must produce it. The U.S. protective
order states: This Order does not preclude the Parties from serving or taking any discovery from other Parties or third
parties relating to, or questioning, the following: . . . The computer source code, software, programs, or technical
specifications relating to any technology owned or claimed by any of the Parties (the Technology). ECF No. 253, at 2-3,
4(c). It is not just the software itself that is not classified. Magistrate Judge Cooke found that [t]he clear
understanding in drafting and issuing th[e] [U.S.] protective order was that the parties would be discussing the nature
and capabilities of the technology, and the type of work each party performed for the government. ECF No. 645, at 6
n.3. As you can see from the orders, Judge Pro and Magistrate Judge Cooke repeatedly ordered Mr. Montgomery to
produce the software, and when he did not comply, Judge Pro held him in contempt and imposed penalties of $2,500
per day until he produced the software.
Thus, we ask you to withdraw your objection and produce the software, tests allegedly validating the software,
identify the location of the software, and produce other materials that you asserted are classified but that plainly are
not.
Misstatements of Defendants Meet and Confer Positions
As we also discussed on Tuesday, Plaintiffs responses and objections to Defendants discovery misstate many
positions Defendants took in meet and confer. You asked me to identify your misstatements in writing and I do so
below.
We did not agree that Mr. Montgomery would answer this interrogatory subject to his objections and
with full reservation of all rights, or that he would produce documents subject to his objections,
which you assert in response to almost every interrogatory and document request. Rather, we made
1
clear that he must comply with Judge Goodmans procedures and the local rules that require
objection-by-objection statements of which documents you withheld subject to the objection and
which you produced.
We did not agree with your objection that interrogatories that require narrative responses would be
left for deposition. We said the opposite: a narrative response to an interrogatory is entirely
appropriate and it would be more efficient for your client to answer the interrogatories before the
deposition.
We did not agree that the definition of your company or your companies is limited to companies in
which the Plaintiff has an ownership or financial interest. (E.g. Resp. to Int. 9, 12.) In our meet and
confer, we pointed out the definition of Montgomerys companies. (Definitions (O).) It includes, among
other things, companies that employed Mr. Montgomery, such as Blxware.
We did not agree that medical records on plaintiffs request to accelerate the trial schedule need not
be produced. (Resp. to Doc. Req. 33.) We asked you to produce these documents.
We didnt withdraw accountant interrogatory. (Int. 23.) Rather, we narrowed it to identify any
accountant who may have information about damages Mr. Montgomery claims.
We ask that you correct your responses and objections to remove these misstatements.
Once again, we ask that you produce all outstanding responsive documents and answer all
interrogatories fully so that we can move forward with discovery without further involving the Court.
Have a nice weekend.
Regards,
Micah
Micah Ratner | Davis Wright Tremaine LLP
1919 Pennsylvania Avenue NW, Suite 800 | Washington, DC 20006-3401
Tel: 202-973-4223 | Fax: 202-973-4423
Email: micahratner@dwt.com | Website: www.dwt.com
Anchorage | Bellevue | Los Angeles | New York | Portland | San Francisco | Seattle | Shanghai | Washington, D.C
EXHIBIT 2
Case Case
1:15-cv-20782-JEM
Case
3:06-cv-00056-PMP-VPC
3:06-cv-00056-PMP-VPC
Document 94-2
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Entered
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253
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PETER D. KEISLER
Assistant Attorney General
STEVEN W. MYHRE
Acting United States Attorney
District of Nevada
GREG ADDINGTON
Assistant United States Attorney
Nevada Bar 6875
100 West Liberty, Suite 600
Reno, Nevada 89501
VINCENT M. GARVEY
Deputy Branch Director
CARLOTTA P. WELLS
Senior Trial Counsel
Federal Programs Branch
Civil Division - Room 7150
U.S. Department of Justice
20 Massachusetts Ave., NW/P.O. Box 883
Telephone: (202)514-4522
Facsimile: (202) 616-8470
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DISTRICT OF NEVADA
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DENNIS MONTGOMERY, et al.,
)
)
Plaintiffs,
)
)
v.
)
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ETREPPID TECHNOLOGIES, INC.,
)
et al.,
)
)
Defendants.
)
____________________________________)
3:06-CV-00056-PMP-VPC
BASE FILE
3:06-CV-00145-PMP-VPC
UNITED STATES ______________

REVISED
PROPOSED
UNITED
STATES PROTECTIVE ORDER
Pursuant to Federal Rule of Civil Procedure 26, in order to protect the classification,
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confidentiality and the rights to information and documents developed and disclosed in
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connection with this litigation, and to facilitate discovery by and among the parties to this
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action and from third parties, the United States hereby proposes entry of the following
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protective order.
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3:06-cv-00056-PMP-VPC
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IT IS HEREBY ORDERED as follows:

1.
Certain information that may or may not be relevant to the claims and/or
defenses of eTreppid Technologies, LLC and its current or former officers or employees
(hereinafter collectively referred to as eTreppid), Warren Trepp, Dennis Montgomery, the
Montgomery Family Trust and/or Dennis Montgomery and Brenda Montgomery as trustees of
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the Montgomery Family Trust (hereinafter collectively referred to as the Parties), as
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delineated in paragraphs 2 and 3 below, is subject to the state secrets privilege, the disclosure
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of which reasonably could be expected to cause serious, and in some cases exceptionally
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grave, damage to the national security of the United States. Such information shall not be
subject to discovery or disclosure by any of the Parties during all proceedings in these actions,
and shall be excluded from evidence at trial.
2.
The Parties shall not serve or take any discovery relating to or questioning the
existence or non-existence of any actual or proposed relationship, agreement, connection,

contract, transaction, communication or meeting of any kind between any entity in the
intelligence community as defined by the National Security Act of 1947,
50 U.S.C. 401(a)(4), which includes intelligence elements of the military services, or any
current or former official, employee or representative thereof (hereinafter collectively referred
to as intelligence agency) and the Parties.
3.
The Parties shall not serve or take any discovery relating to or questioning any
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actual or proposed intelligence agency interest in, application of or use of any technology,
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software or source code owned or claimed by the Parties.
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4.
This Order does not preclude the Parties from serving or taking any discovery
from other Parties or third parties relating to, or questioning, the following:
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a.
The existence and nature of the Big Safari contract (hereinafter referred to as
the Big Safari Contract) between eTreppid and the Unites States Air Force, including but not
limited to the fact that the Big Safari Contract required eTreppid to perform data analysis and
the fact that the data analysis eTreppid performed under the Big Safari Contract involved
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image identification technology;
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b.
The fact that the Big Safari Contract required employees and/or officers of
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eTreppid to sign secrecy agreements with the Department of Defense;
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c.
The computer source code, software, programs, or technical specifications
relating to any technology owned or claimed by any of the Parties (the Technology);
d.
Any contract, relationship, agreement, connection, transaction, communication
or meeting of any kind relating to the Technology, unless covered by paragraphs 2 or 3 above;
e.
Any actual or potential commercial or government applications of the
Technology, unless covered by paragraphs 2 or 3 above;

f.
Facts relating to the issue of ownership by the Parties of any right or interest in
the Technology, unless covered by paragraphs 2 or 3 above;

g.
The revenue, income, expenses, profits and losses of the Parties, unless
disclosure of such information would be covered by paragraphs 2 or 3 above; and

h.
Any consideration received by any of the Parties relating to the Technology,
unless covered by paragraphs 2 or 3 above.

5.
The Parties shall not discuss, mention, question or introduce as evidence, either
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at trial, in any pleading or motion, or in any case-related correspondence, any actual or
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proposed relationship, agreement, connection, contract, transaction, communication or
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meeting of any kind between any intelligence agency and any of the Parties.
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6.
The Parties shall not discuss, mention, question or introduce as evidence, either
at trial, in any pleading or motion, or in any case-related correspondence, any actual or

proposed intelligence agency interest in, application of or use of the Technology.
7.
No question and no document request in discovery or at trial shall require a
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response that would include any information covered by paragraphs 2, 3, 5 or 6 above, but if
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the responding party believes that a full and complete response could disclose information
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within the scope of the state secrets privilege, the responding party shall provide timely notice
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of such belief and the full and complete response to the United States prior to responding, and
shall respond only with information that the United States has determined is not subject to the
state secrets privilege.
8.
The military and state secrets privilege, the claim that any discovery is
covered by paragraphs 2 or 3 above, and the claim that any evidence is covered by
paragraphs 2 or 3 above, can only be invoked by the United States. These claims cannot be
asserted by a private individual or entity.
9.
All Parties shall serve the attorneys for the United States with (a) a copy of
all notices of depositions, (b) a copy of all requests for discovery and responses thereto,
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and (c) a copy of all pleadings and motions filed together with supporting memoranda
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(hereinafter collectively referred to as the documents), unless such documents request or
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relate to information covered by paragraphs 2 or 3 above. If the documents request or
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relate to information covered by paragraphs 2 or 3 above, the Parties shall submit the
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documents to the United States for privilege review prior to service or filing. All
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documents filed or sought to be used as evidence by the Parties in this case shall be
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unclassified. This requirement applies to all motions, pleadings, briefs, and any other
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document, including exhibits, correspondence, or anything appended thereto or filed
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therewith. If the United States determines that a document or discovery response includes
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3:06-cv-00056-PMP-VPC
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information covered by paragraphs 2 or 3 above, the United States shall redact the
information and provide the parties and Court with a redacted copy of the document or
discovery response.
10.
The Clerk of the Court shall send attorneys for the United States a copy of all
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future decisions and notices for hearings in these cases.
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11.
As the United States deems necessary, attorneys for the United States may
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attend all depositions and proceedings in this case and may make objections as necessary to
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protect national security information. If attorneys for the United States assert an objection
based on the need to protect national security information with respect to either witness
testimony or documents introduced or otherwise relied upon during a deposition, then the
witness shall be precluded from testifying with respect to the line of inquiry that engendered
the objection, and the document shall be withdrawn from the record pending an order of the
Court with respect to the scope of the governments national security objection.
12.
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To protect the United States interests, attorneys for the United States may
participate in any proceeding in these cases, including but not limited to motions hearings, all
pre-trial proceedings, or trial by making and opposing motions, submitting briefs, and
participating in arguments.
13.
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The United States shall be excepted from all party discovery during the
20
pendency of its motions to dismiss the claims against the Department of Defense.
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It is so ordered.
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Dated:
August 29, 2007
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_______________________________
UnitedM.
States
PHILIP
PRODistrict Judge
United States District Judge
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EXHIBIT 3
Case 1:15-cv-20782-JEM
Case 3:06-cv-00056-PMP-VPC
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DISTRICT OF NEVADA
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)
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Plaintiffs,
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vs.
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ETREPPID TECHNOLOGIES, LLC., et al., )
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Defendants.
)
____________________________________)
3:06-CV-0056-PMP (VPC)
ORDER REGARDING
SOURCE CODE DISCOVERY
On February 21, 2008, this court held a discovery status conference and considered the motion
of eTreppid Technologies, LLC and Warren Trepp (eTreppid) to compel production of certain
discovery (#s 431 & 433) and the opposition of Dennis Montgomery and the Montgomery Family Trust
(Montgomery parties) (#432). The court directed the parties to file supplemental points and
authorities, and they did so (#s 461-463; # 467). The Montgomery parties also filed a request for judicial
notice (#468) and a motion for permission to file under seal those documents referenced in the request
for judicial notice (#469). The parties then filed replies (#s 498 & 500), and the court heard oral
argument on April 2, 2008 and took the matter under submission.
I.
Facts
In 1998, Dennis Montgomery and Warren Trepp formed eTreppid, formerly known as Intrepid,
a small, start-up technology company.
Mr. Trepp contributed his business expertise, and Mr.
Montgomery contributed his considerable experience as an inventor and software developer. In the fall
of 2005, disagreements arose between Messrs. Trepp and Montgomery, and this litigation ensued.
A.
The Contribution Agreement
The Montgomery parties and eTreppid signed two agreements that are relevant to this discovery
dispute. The first is a September 28, 1998 contribution agreement (#432, Ex. G). The contribution
agreement states that the Montgomery parties were to contribute Mr. Montgomerys know-how, trade
secrets, patent rights, copyrights, trademarks, licenses and permits, . . . relating to or used in connection
with, or otherwise describing or consisting of any part of, the software compression technology
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contained on that certain Software Compression Engine Development Program contained on CD No.
1, . . . Id. at Ex. G, section 1.2.1. The contribution agreement also contains a provision which
expressly excludes any other tangible or intangible assets of Contributor not specified herein. Id. at
Ex. G, section 1.3.
All parties agree that the contents of CD No. 1 are essential to an understanding of the exact
nature and extent of Mr. Montgomerys contribution; however, none of the parties has CD No. 1 or a
copy. See Declarations of Warren Trepp, Doug Frye, and Dennis Montgomery, #s 464, 465 & 471.
B.
The Operating Agreement
In addition to the contribution agreement, the parties also signed an operating agreement naming
Mr. Montgomery as manager and Mr. Trepp as management committee chair of eTreppid (#467, Ex. A,
sections 6.1.1 & 6.1.5.). As eTreppids manager, Mr. Montgomery and his affiliates were prohibited
from competing with eTreppid by:
(i) developing, licensing or exploiting in any manner any software
programs or other technology which is competitive with the Technology
or the Business of the LLC, or providing any services or supplies which
are encompassed within the definition of the Business of the LLC as set
forth in this Agreement; (ii) purchasing or otherwise acquiring, owning,
holding, operating, managing, investing in or otherwise disposing of a
like business of the LLCs Business and interests therein of any kind or
nature; or (iii) otherwise engaging in any or all aspects of a like business
of the LLCs Business. The Managers or his Affiliates participation in
any of the activities restricted by this paragraph shall be deemed a breach
of the Managers duties herein.
Id. at Ex. A, section 6.5.
C.
Copyrights
Another set of documents relevant to this dispute are Mr. Montgomerys copyrights. Before
joining eTreppid, Mr. Montgomery developed pattern recognition software, and the U.S. Copyright
Office granted a series of copyrights, which the Montgomery Family Trust owns (#7, 8). The
Montgomery parties allege that after the registration of these copyrights, Mr. Montgomery developed
derivative works based on the pattern recognition technology originally copyrighted between 1982 and
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January 1987. Id. at 9. Mr. Montgomery alleges that these copyrights were not contributed to eTreppid
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pursuant to the contribution agreement.
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D.
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eTreppid Operations
From January 1999 until January 2006, Mr. Montgomery served as eTreppids chief technology
officer. As chief technology officer, Mr. Montgomery was responsible for day-to-day business
operations, development of eTreppids technology, making hiring decisions, and overseeing the
programmers who worked for eTreppid. See #469, Ex. D, Transcript of February 7, 2006 preliminary
injunction hearing before the Second Judicial District Court of the State of Nevada, Case No. CV060114 at page 245, lines 4-14; 250:2-6 (Tr.). In contrast, Mr. Trepp had no technical knowledge and
served as the investor with business experience, relying on Mr. Montgomery for the daily operations of
8
eTreppid. Tr. at 245:4-14.
9
Mr. Montgomery was also responsible for backing up the eTreppid source code, which Sloan
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Venables, an eTreppid employee, defined as the actual ... files that are used to be compiled into the
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software eTreppid developed. Tr. 28, lines 7-10 & 23-24; 29:1-2. The eTreppid source code consists
12
of multiple source code files, which consist of more than one hundred different projects and thousands
13
of files. Tr. at 54:21-24. Mr. Montgomery was the sole individual at eTreppid responsible for backing
14
up and maintaining the source code, which was a necessary precaution in the event computer hardware
15
failed. Tr. at 29:21-24; 30:1-5 & 16-22. The original copy of the eTreppid source code was located on
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the SRCSERVER, and Mr. Montgomery made copies of the hard drives of all of the programmers in
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the building, which he routinely copied on two work stations in eTreppids warehouse. Tr. at 33:24;
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34:1-12. Prior to December 21, 2005, all of the source code was backed up. Tr. at 34:13-24; 35:1-7.
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After the Christmas holidays, eTreppid employees returned to work and discovered that nearly all of
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eTreppids source code had been deleted. Tr. at 39:12-24; 40, 42, 43:1-19. On January 10, 2006, shortly
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after the discovery of the missing source code, Messrs. Trepp and Montgomery argued, and Mr.
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Montgomery left eTreppid and never returned. Tr. at 46:23-24; 47:1-18.

II.
The Parties Claims and Counterclaims
The operative pleadings in this action are the Montgomery parties first amended complaint (#7)
and eTreppids answer to the first amended complaint and counterclaim (#393). The parties claims and
counterclaims are critical to the courts analysis of what information and documents are reasonably
calculated to lead to the discovery of admissible evidence pursuant to Fed.R.Civ.P. 26(b)(1).
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A.
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The Montgomery parties amended complaint (#7)

Copyright infringement
The Montgomery parties allege that the Montgomery Family Trust owns certain copyrights and
derivative works, and that for approximately three years, eTreppid exploited the derivative works
without any license or payment of royalties (#7, 21-23). The Montgomery parties allege that Mr.
Trepp intentionally directed a willful infringement of the copyrights and derivative works, and they seek
damages.1 Id. at 24-26.
7
8
2.
Copyright infringement - unlawful distribution of copyrighted work injunction
The Montgomery parties allege that they own the derivative works and that eTreppid violated
10
the trusts right and interest to distribute copies of the derivative works to the public in violation of 17
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U.S.C. 106(3). Id. at 27-30. The Montgomery Parties seek to enjoin eTreppid from further
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infringement. Id.
3.
13
Declaratory relief
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The Montgomery parties seek a judicial declaration that they own the derivative works, and
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further, that any actual or implied oral nonexclusive license either never existed or was terminated. Id.
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at 31-33. The Montgomery parties also seek a declaration that the trust is entitled to 100 percent of
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the license fees obtained by the exploitation and sub-licensing of the derivative works. Id. at 34-35.
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4.
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Accounting
The Montgomery parties seek an accounting of all profits derived from eTreppids alleged
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exploitation of the copyrights and derivative works.2 Id. at 36-39.
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On July 30, 2007, the District Court dismissed the Montgomery Parties copyright claims only to the
extent those claims are based on any allegations eTreppid and Trepp infringed the novel aspects of the Derivative
works (#217).
2
On March 20, 2007, in the consolidated case, the District Court dismissed with prejudice the
Montgomery Parties counterclaim requesting an accounting based on the fact that the claim is pre-empted by
federal copyright law. See Case No. 3:06-CV-00145-PMP-VPC, #91. This order was also filed in the base file,
3:06-CV-00056-PMP-VPC, at docket #131. To the extent that the order did not technically dismiss the
Montgomery Parties accounting claim in their first amended complaint file in case number 3:06-CV-00056PMP-VPC, see #7, the court does so now.
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Breach of fiduciary duty
The Montgomery parties allege that Mr. Trepp owed fiduciary duties to Mr. Montgomery and
that Mr. Trepp violated those duties by improperly using his majority interests to reduce those of Mr.
Montgomery by paying himself a high salary, improperly deducting business expenses, and taking
distributions and misappropriating money from the company at Mr. Montgomerys expense. Id. at
40-44.
6.
Fraud
The Montgomery parties allege that Mr. Trepp induced Mr. Montgomery to become a
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shareholder in eTreppid and to contribute his software technology by falsely representing that Mr.
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Montgomery would share equally with Mr. Trepp in the profits of the company. Id. at 45-48. It is
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further alleged that Mr. Trepp failed to share the profits equally, and that the Montgomery parties
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suffered damages as a result. Id. at 49-51.
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7.
Breach of contract
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The Montgomery parties allege that pursuant to the contribution agreement, Mr. Montgomery
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contributed his software compression technology in return for a fifty percent ownership in eTreppid, but
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that Mr. Trepp breached the agreement by reducing the Montgomery parties ownership interest in the
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company. Id. at 52-57.
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8.
Misappropriation of trade secrets
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The Montgomery parties allege that the derivative works are trade secrets and that eTreppid has
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wrongfully attempted to misappropriate and convert those derivative works, causing the Montgomery
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Parties damage. Id. at 58-62.
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9.
Conversion
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The Montgomery parties allege that they own the derivative works, which are currently in
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eTreppids possession, but that eTreppid has converted this property for its own use and has refused to
return it. Id. at 63-65. The Montgomery parties allege they have suffered damages as a result. Id. at
66.
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10.
Declaratory relief against the United States
Although the Montgomery parties stipulated to dismiss this claim against the United States
(#295), the Montgomery parties make the following allegations in this claim for relief, which are
relevant to this discovery dispute:
a.
[I]n order to defend Trepps and eTreppids claims of trade secret

misappropriation and prosecute their own claims, Montgomery
will be obligated to disclose the nature of the technology, the type
of work that he has performed on government contracts using his
technology versus that of eTreppid, and the capabilities of his
technology versus that of eTreppid in performing work for certain
government agencies.
b.
[T]hese disclosures go to the very core of Defendants expected

defense of this action, making it virtually, if not literally,
impossible to defend without violating Montgomerys secrecy
oath and compromising national security.
c.
Montgomery ... must make such disclosures in order to establish

his ownership interests in the technology.
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B.
eTreppid names not only the Montgomery parties as counterdefendants, but also Edra Blixsth,
Opspring LLC, Atigeo LLC, and Michael Sandoval as parties in its counterclaim.
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Misappropriation of trade secrets - N.R.S. 600A.010 et seq.
eTreppid alleges that the counterdefendants misappropriated its trade secret materials, which it
defines as its Source Code for digital compression products, including compression, pattern
recognition, object tracking, anomaly detection technology, film colorization and other applications
(#393, 63-71).
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eTreppids Counterclaims (#393)
2.
Breach of contract
eTreppid alleges that in improperly taking eTreppids trade secrets, Mr. Montgomery breached
the contribution agreement. Id. at 72-75.
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The court notes that this claim for relief precipitated the United States Protective Order, which governs
disclosures of this kind (#253). The clear understanding in drafting and issuing that protective order was that
the parties would be discussing the nature and capabilities of the technology, and the type of work each party
performed for the government. In addition, the court issued a protective order governing disclosure of trade
secrets and other confidential information (#264).
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Conversion
eTreppid alleges that the counterdefendants have converted eTreppids confidential information
and trade secrets for their own use. Id. at 76-78.
4.
Breach of fiduciary duty
eTreppid alleges that based on the misappropriation of trade secrets, the Montgomery parties,
as members of eTreppid and/or the management committee, breached their fiduciary duties to eTreppid.
Id. at 79-84.
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eTreppid alleges that Mr. Montgomery breached the implied contractual covenant of good faith
and fair dealing based upon the allegations outlined in the counterclaim. Id. at 85-90.
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parties written agreements and state statutes. Id. at 91-93.

7.
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they intentionally interfered with those contracts. Id. at 94-99.

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of Mr. Montgomerys contracts with eTreppid, and intentionally interfered with those contracts. Id. at
100-105.
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Intentional interference with contract
eTreppid alleges that counterdefendants Blixseth, Sandoval, Opspring, and Atigeo were aware
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eTreppid alleges that all counterdefendants were aware of its contracts with third parties and that
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Declaratory relief
eTreppid seeks a judicial determination of the rights and duties of the parties pursuant to the
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Tortious and contractual bad faith
Claim and delivery
eTreppid alleges that it owns certain computer hard drives and other electronic storage media
and devices that may contain eTreppids intellectual property, that Mr. Montgomery wrongfully took
the property and, on information and belief, may have copied confidential information, converting it to
Mr. Montgomerys own use or demanding payment of money for its return. Id. at 106-110.
///
///
///
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10.
Civil Conspiracy
eTreppid alleges that the counterdefendants acted in concert to misappropriate eTreppids
technology and harm eTreppids ability to fulfill prospective economic relationships, thereby violating
the preliminary injunction. Id. at 111-115.
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eTreppid alleges that it had prospective economic relationships with third parties, of which the
counterdefendants were aware, and that they intentionally interfered with those potential relationships.
Id. at 116-122.
III.
The February 7, 2006 Preliminary Injunction Hearing
Prior to the removal and consolidation of these actions, the state court held a preliminary
injunction hearing to decide whether to enjoin the Montgomery parties from destroying, using, or
assigning eTreppids source code pending the outcome of this litigation. A copy of the transcript is
attached as Exhibit D to the Montgomery parties request for judicial notice (#469) (Tr.). During that
hearing, the state court heard testimony from Mr. Trepp, Mr. Montgomery, and eTreppid employees
familiar with the computer operations at the company. Both Mr. Trepp and Mr. Montgomery testified
that during Mr. Montgomerys tenure at eTreppid, the government contracted only with eTreppid, and
not Mr. Montgomery in his individual capacity. Tr. at page 72, lines 20-24; pages 73-77; 229:24; 230231, 232:1-12.
After twelve hours of testimony, the court issued a preliminary injunction and found:
1.
Pursuant to the employment agreement between the parties, the

subsequent undisputed conduct of the parties throughout the
course of Montgomerys employment with ETreppid, and
Montgomerys acquiescence to and active participation in
contractual agreements entered into by ETreppid with third
parties involving the Source Code and technology at issue,
[ETreppid] is likely to prevail on the merits of its claims;
2.
[Etreppid] has demonstrated a reasonable probability that [it] will

suffer irreparable harm if a preliminary injunction does not issue
[because] the record reflects that the Source Code is essential to
ETreppids operations;
3.
The technology at issue includes data compression software,

image detection software, and pattern recognition software, which
necessarily relies upon the Source Code for its operation, and is
alleged to be valued in excess of $100,000,000;
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Without the Source Code, ETreppid may be forced to forego

entering into valuable contracts for the use or sale of said
technology; and
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[ETreppid] may suffer damages in excess of $10,000 per day if

[it] remains without possession of the Source Code.
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(#15, Ex. 7). Based upon these findings, the state court enjoined the Montgomery parties, and all
persons in active concert or participation with them, from destroying, hypothecating, transferring,
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modifying, and/or assigning the ETreppid Source Code, from discussing ETreppid technology, including
anomaly detection and pattern recognition software, with any third-party, except experts and other
persons and witnesses necessary to Defendants case and counsel, provided, however, that such
witnesses and counsel shall not disclose any information to others about ETreppid Source Code. Id.,
Ex. 7 at 3.
IV.
Legal Analysis and Discussion
Federal Rule of Civil Procedure 26(b) provides that Parties may obtain discovery regarding any
non-privileged matter that is relevant to any partys claim or defense. Fed.R.Civ.P. 26(b)(1). Further,
[r]elevant information need not be admissible at the trial if the discovery appears reasonably calculated
to lead to the discovery of admissible evidence. Id. Rule 26(c) allows the court to protect parties from
undue burden and expense in discovery by requiring that a trade secret or other confidential research,
development, or commercial information not be revealed or be revealed only in a specified way.
Fed.R.Civ.P. 26(c)(1)(G). Trade secrets do not have automatic and complete immunity from
disclosure, but [courts] have in each case weighted their claim to privacy against the need for
disclosure. Advisory Committee Notice to 1970 Amendments to Rule 26(c). The Ninth Circuit has held
that disclosure of trade secrets will be required only where such disclosure is relevant and necessary
to the prosecution or defense of a particular case. Hartley Pen Co. v. United States District Court for
S.D. Cal., 287 F.2d 324, 330-31 (9th Cir. 1961). The party seeking disclosure must establish that the
trade secret sought is relevant and necessary to the prosecution or defense of the case before a court is
justified in ordering disclosure. Id.
Although the parties have focused almost exclusively on their respective trade secret and
copyright claims as those relate to the discovery eTreppid seeks, the court considers the discovery in the
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broader context of all of the claims and counterclaims alleged.

A.
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Etreppids request for production-1: No. 22 and request for production-2:

No. 4 CD No 1
The discovery requests at issue are:
1.
All documents that relate to the software that [Mr. Montgomery]

transferred to eTreppid under the terms of the September 28, 1998
Contribution Agreement (including, but not limited to: all source code
whether in printed or electronic form executable files, shop notes,
laboratory notes, and any other memoranda).4
2.
All documents that relate to the software that [Mr. Montgomery]

transferred to eTreppid under the terms of the September 28, 1998
Contribution Agreement (including, but not limited to, all source code
whether in printed or electronic form executable files, shop notes,
laboratory notes, and any other memoranda).
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Request No. 22 (RFP-1):
Request No. 4 (RFP-2)
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After this discovery dispute arose, the court ordered the parties to file declarations with the court
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concerning possession of CD No. 1. Mr. Trepp states in his declaration that he instructed eTreppid
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employees to examine every hard drive, CD, or other storage device they could find in order to locate
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this CD 1, but these efforts have not resulted in the location of this item (#464). Mr. Trepp also
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states that during his tenure at eTreppid, Mr. Montgomery provided Mr. Trepp with CDs, DVDs and/or
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hard drives that allegedly contained the then-current version of the eTreppid Source Code, which [Mr.
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Trepp] would then store at an off-site location. These storage media should have contained the source
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code contributed on CD1, as well as other source code developed by eTreppid. Id. However, Mr.
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Trepp attests that having directed the review of these media, they do not and have never contained a
completed version of the eTreppid Source Code for any period of time. Further, while these backups
did contain a portion of an early, 2001 version of one of eTreppids compression products, this was all
that was located on the backup media. Id.
Doug Frye, a member of eTreppid and its counsel, also filed a declaration concerning the
whereabouts of CD No. 1 (#465). Mr. Frye states that he searched his files, both at his office and at
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The court also addresses this request for production below as it relates to source code and other
technology Montgomery claims as a trade secret.
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home, and did locate a CD that Mr. Montgomery had given to him. Id. Mr. Frye does not recall the
circumstances or the date that Mr. Montgomery gave him the CD, but recalls that Mr. Montgomery told
him at the time that it contained a backup copy of eTreppids technology. Id. Mr. Frye gave the CD to
Mr. Trepp, and upon examination by eTreppid employees, Mr. Frye attests that it does not contain source
code or other useful information. Id.
Mr. Montgomery also filed his declaration concerning CD No. 1 and attests that he is unable to
locate the original or a copy of CD No. 1, nor does he believe it existed in printed form (#466). Mr.
Montgomery states that CD No. 1 contained software programs for software compression technology
and included executable files and related source code and a software compression engine development
program. Id. Mr. Montgomery further attests that while he was careful to maintain his work product
in an organized fashion to insure he could reconstruct his work, the FBI destroyed that organization
during the seizure at his home and storage facility. Id. Moreover, he contends that there are
discrepancies between the FBI seizure list and the FBI return lists, which have not been resolved, and
this makes it impossible for him to determine whether or if the work product can be reconstructed at all.
Id. Mr. Montgomery goes on to state that even if he had all of the software compression files he had as
of September 1998 when he signed the contribution agreement, he could not reconstruct CD No. 1
without actually reviewing the files, which is not technically feasible, given the alleged destruction and
failure to return all of his property. Id. Although Mr. Montgomerys declaration is silent concerning
whether he ever delivered CD No. 1 to Mr. Trepp or someone at eTreppid, Mr. Montgomery testified
at the preliminary injunction hearing that he gave it to Mr. Frye (#469, Ex. E, Tr. at page 143, lines 1024; 135:1-10).
It is undisputed that what is on CD No. 1 is pivotal to the parties claims and counterclaims in
this proceeding. Remarkably, this key piece of evidence apparently no longer exists. Messrs. Frye and
Trepp state under penalty of perjury that they have searched every piece of media located at eTreppid
and in other locations where it might be found, but that the media that Mr. Montgomery provided during
26
his tenure at eTreppid whether CD No. 1 or otherwise contain nothing relevant to the claims alleged
27
in this action, including data compression software. Mr. Montgomery likewise states under penalty
28
of perjury that he gave CD No. 1 to Mr. Frye back in September 1998, and that to the extent he might
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have had possession of CD No.1, the FBI search of his home and storage units resulted in loss or
destruction of certain of his work product. Mr. Montgomery states that it is virtually impossible to recreate CD No.1 based on technical lack of feasibility, accessibility of files, time and expense.
At this point in the litigation, the court will not order Mr. Montgomery to recreate CD No. 1, but
it reserves this issue for future consideration after more thoroughly testing Mr. Montgomerys allegations
that the FBI lost or destroyed property such that it prevents him from being able to re-create CD No. 1.
In the interim, the court draws two conclusions. First, these document production requests are broader
than simply seeking production of CD No. 1. Second, the court agrees with eTreppid that Mr.
Montgomerys declaration is silent as to whether he has in his possession any documents or information
that was contained on CD No. 1, other than to state that CD No. 1 itself did not exist in printed form.
The court concludes that documents pertaining to CD No. 1 are likely to lead to the discovery
of admissible evidence, and the Montgomery parties are ordered to produce all documents, including
but not limited to those in electronic form, which are responsive to RFP-1, No. 22, and RFP-2, No 4.
B.
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Etreppids request for production-1, Nos. 3, 4, 6, 8, 9, 16, 18, 19, 20 & 22 and
request for production-2, Nos. 1, 2, & 3 and any others to the extent they
seek source code and other technology Montgomery claims as a trade secret
eTreppids first request for production of documents includes the following items in dispute:
1.
Request No. 3:
All documents that contain some or all of the full text of each of
the copyrights.
2.
Request No. 4:
All documents that contain some or all of any material, included

in and/or protected by the copyrights, that you contend defendants
have, either collectively or individually, infringed.
3.
Request No. 6:
All documents that contain some or all of the full text of each
work that you contend is a derivative work of the copyrights.
4.
Request No. 8:
All documents that relate to your contention that defendants,

either collectively or individually, have infringed upon any of the
copyrights.
5.
Request No. 9:
All documents that relate to your contention that defendants,

either collectively or individually, have infringed upon any work
that you contend is a derivative work of the copyrights.
6.
Request No. 16:
All documents that relate to eTreppids technology, products,

and/or research and development efforts (including but not
limited to: any and all marketing documents, business plans,
PowerPoint presentations, white papers, correspondence, and/or
notes of meetings with customers or potential customers).
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7.
Request No. 18:
All documents that contain any source code, written by you or

under your direction, that relate to the fields of data compression,
pattern recognition, object tracking or anomaly detection
(including but not limited to: all of any part of a software program
or algorithm).
8.
Request No. 19:
All documents that relate to any research and development efforts

made, by you or by anyone working under your direction, in the
fields of data compression, object tracking, pattern recognition,
or anomaly detection (including, but not limited to: any and all
notes, diagrams, laboratory materials, or source code).
9.
Request No. 20:
Executable versions of any and all software, developed by you or

by anyone working under your direction, which relates to the
fields of data compression, object tracking, pattern recognition,
or anomaly detection.
10.
Request No. 22:
All documents that relate to the software that you transferred to

eTreppid under the terms of the September 28, 1998 Contribution
Agreement (including but not limited to: all source code
whether in printed or electronic form executable files, shop
notes, laboratory notes, and any other memoranda).
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eTreppids second request for production of documents includes these items in dispute:
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1.
Request No. 1:
Please produce all documents that contain any source code,

writen by you or under your direction, that relate to the fields of
data compression, pattern recognition, object tracking or anomaly
detection (including, but not limited to: all or any part of a
software program or algorithm).
2.
Request No. 2:
Please produce all documents that relate to any research and

development efforts made, by you or by anyone working under
your direction, in the fields of data compression, object tracking,
pattern recognition, or anomaly detection (including, but not
limited to: any and all notes, diagrams, laboratory materials, or
source code).
3.
Request No. 3:
Please produce all executable versions of any and all software

developed by you or by anyone working under your direction,
which relates to the fields of data compression, object tracking,
pattern recognition, or anomaly detection.5
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This dispute also concerns Request Nos. 30 and 31 in the first request for production of
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documents, and Request Nos. 6, 7, and 24 through 28, of the second request for production of documents
to the extent that responses may also implicate the dispute over disclosure of documents related to this
issue.
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RFP-1 Nos. 18, 19 & 20 are identical to RFP-2 Nos. 1, 2, & 3.

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As earlier noted, the debate among the parties concerning these document production requests
centers on the trade secret and copyright claims; however, the parties numerous other claims and
counterclaims include a wide range of tort and equitable claims, and the court must consider these
requests in that broader context. The court has reviewed the parties pleadings, the transcript of the
preliminary injunction hearing, the order that followed, as well as the legal arguments and evidence
concerning this dispute.
The court also noted earlier that the Montgomery parties originally named the United States
Department of Defense as a defendant in their amended complaint, and those allegations are quite
contrary to the position the Montgomery parties new counsel now takes concerning disclosure of Mr.
Montgomerys technology (#7, 68-74). While it is true that the United States has since been
dismissed, as has the tenth claim for relief, the allegations are telling. Plaintiffs allege that in order to
defend Trepps and eTreppids claims of trade secret misappropriation and prosecute their own claims,
Montgomery will be obligated to disclose the nature of the technology, the type of work that he has
performed on the government contracts using his technology versus that of eTreppid, and the capabilities
of his technology versus that of eTreppid in performing work for certain government agencies. Id. at
71. The Montgomery parties further allege that, these disclosures go to the very core of [eTreppids]
expected defense of this action, making it virtually, if not literally, impossible to defend. . . . Id. at 72.
This makes sense, and is the very reason that the parties subsequently executed not only a standard
protective order governing disclosure of trade secrets, but also the United States protective order
governing the military and state secrets privilege. With these safeguards in place, it was presumed that
the parties could proceed to discover information relating to their respective claims and defenses.
The court also finds instructive both the preliminary injunction transcript and state courts
preliminary injunction order. Having heard the testimony of Mr. Trepp, Mr. Montgomery, and eTreppid
employees intimately familiar with eTreppids operations, the state court issued a preliminary injunction
and concluded that Mr. Montgomery took technology of value when he left eTreppid. The state court
26
order does not specifically define eTreppids source code, but includes in that term data compression
27
software, image detection software, pattern recognition software, which necessarily relies upon the
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Source Code for its operation, and the court later includes a reference in the order to anomaly detection
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and pattern recognition software, all of which the court clearly understood to be at the heart of this case
(#15, Ex. 7). The final sentence of this order is instructive: The Court issues this injunction to maintain
the status quo and to avert any irreparable harm that ETreppid may suffer and based on the risk that Mr.
Montgomery could delete and/or transfer the last version of the ETreppid Source Code that remains
intact. Id.
The Montgomery parties contend eTreppid cannot take discovery on its trade secret claim
because it must first specifically identify the trade secret, and a protective order is proper until a plaintiff
claiming trade secret misappropriation has adequately identified its own trade secret. IMAX Corp. v.
Cinema Technologies, Inc., 152 F.3d 1161 (9th Cir. 1998). The pivotal difference between this action
and Imax is the facts.
Imax concerned the patents that Imax acquired to the rolling loop projector, making it the
worlds largest supplier of such projectors. Imax, 152 F.3d at 1163. To protect the secrecy of the
undisclosed technology, Imax included a confidentiality provision in each sales or lease agreement,
which forbade customers from disclosing confidential information about the system. Id. Three
individuals, who were never employed by Imax, formed a company with the goal of developing their
own large format projector that would compete with Imax. Id. They obtained a copy of an Imax manual
that was not marked confidential, and they then observed, disassembled, measured, photographed,
traced, and sketched the Imax projector. Id. Eventually, the company unveiled its own rolling loop
projector at a trade show, and Imax sued, alleging misappropriation of trade secrets and unfair
competition. Id. at 1163-64. However, Imax was unable to identify the dimensions and tolerances of
its projector design that were its claimed trade secrets, and the court granted summary judgment against
Imax on that claim. Id. at 1170.
The fact that Imax held the patents to the projector, developed and sold the projector, yet was
unable to identify the allegedly misappropriated trade secret dictated the courts conclusion in Imax. In
other words, since Imax, or an employee of Imax whom Imax could consult, created the projector, and
26
therefore the trade secret, it ought to be able to identify it. In contrast, Mr. Montgomery came to
27
eTreppid with CD No.1 and his years of computer training and expertise. He agreed to devote all of his
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technical know-how solely for the benefit of eTreppid during his tenure there. He oversaw the
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companys software development programs, and he alone was the custodian of eTreppids source code
and was entrusted with insuring its security. Neither Mr. Trepp, Mr. Frye, or any of the eTreppid
software engineers had Mr. Montgomerys level of access to eTreppids source code, so when he left
eTreppid and allegedly took eTreppids source code with him, eTreppid could not possibly identify
its alleged trade secret because the one person who could identify it was gone. To further complicate
matters, no one has a copy of CD No. 1, the technology Mr. Montgomery initially contributed to
eTreppid.
What the source code is, or is not, is a central issue in this action. This court agrees with the
Montgomery parties that the preliminary injunction order does not give eTreppid a monopoly in the
development of software and technology in the fields of anomaly detection and pattern recognition, and
that the injunction is limited to the source code at issue. However, the order expressly enjoins Mr.
Montgomery from using that source code pending disposition of this action. Mr. Montgomery admits
he is in possession of the source code eTreppid used in fulfilling its contractual obligations and that he
continues to work to improve that technology with the financial assistance of his new employer;
however, he contends this does not violate the preliminary injunction order because the technology he
is using belongs to him (Dec. of Mr. Montgomery, #462, Ex. B; see also #115, Case No. 3:06-CV-0263PMP (VPC)). Because Mr. Montgomery took or deleted the source code from eTreppids computer
a finding Judge Perry made in February 2006 eTreppid cannot define the source code without its
requested discovery, and it is clear that it will be impossible to adequately prosecute or defend the
myriad of claims and counterclaims without defining the source code.
This case also revolves around the technology developed at eTreppid for use in contracts with
government entities. It was eTreppid, not Mr. Montgomery, who entered into these contracts. However,
Mr. Montgomery claims that the technology used in these contracts is derived from his copyrights, which
he never assigned to eTreppid. eTreppid contends that some or all of the technology used in these
contracts is derived from CD No.1 and that Mr. Montgomery agreed to devote all of his know-how for
26
the exclusive benefit of eTreppid. In response, Mr. Montgomery essentially asks eTreppid and this court
27
to take his word for it that all that eTreppid is entitled to is that which was contributed on the now
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vanished CD No. 1, and that any technology he now possesses is solely derived from his unassigned
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copyrights. In other words, the valuable trade secret in this case is his because he says so. This is not
enough.
Disclosure of trade secrets will be required where such disclosure is relevant and necessary to
the prosecution and defense of the parties claims. See Hartley Pen Co., 287 F.2d, 324, 330-31.
Discoverable information need only appear reasonably calculated to lead to the discovery of admissible
evidence. Fed.R.Civ.P. 26(b)(1). Because the protective order regarding trade secrets is in place, the
court believes that the Montgomery Parties are protected from the technologys misuse in the event that
this court determines that the Montgomery parties are the rightful owners of the disputed technology.
Fed.R.Civ.P. 26(c)(1)(G). To sort out what rightfully belongs to the Montgomery parties and eTreppid,
it makes sense to take discovery on this technology, particularly in light of the fact that CD No.1 no
longer exists. The questions to be answered are what technology eTreppid began with in September
1998 and what technology was developed at eTreppid in the ensuing seven years. Only after sorting
through this tangle can the parties reasonably argue ownership and develop their claims and defenses
accordingly. Simply put, there is no conceivable way eTreppid can describe its trade secret, because Mr.
Montgomery has made that impossible based upon the events that occurred in December 2005 and
January 2006.
The court is convinced that neither eTreppid nor the Montgomery parties will be able to
conclusively prove ownership of the technology without analysis of the source code; thus, the court
concludes that documents related to the source code and other technology Montgomery claims as a trade
secret are reasonably calculated to lead to the discovery of admissible evidence. The Montgomery
parties are ordered to produce all documents, including but not limited to those in electronic form, which
are responsive to RFP-1, Nos. 3, 4, 6, 8, 9, 16, 18, 19, 20 & 22 , and RFP-2, Nos. 1, 2 & 3 as limited by
the court below.
V.
Conclusion
Based upon the foregoing, and for good cause appearing, IT IS HEREBY ORDERED:
1.
eTreppids motion to compel (#431) is GRANTED IN PART AND DENIED IN

PART as more fully set forth in this order and as follows:
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a.
No. 4;
2
b.
contain a reference to some or all of the text of the copyrights if good cause is
shown that such further discovery is reasonably calculated to lead to the
discovery of admissible evidence;
7
c.
d.
10
documents pre-dating 1997 if good cause is shown that such further discovery is
12
reasonably calculated to lead to the discovery of admissible evidence.
13
2.
3.
The Montgomery parties request for judicial notice (#468) is GRANTED;
4.
The Montgomery parties motion to file document under seal (#469) is DENIED AS
MOOT, as this court has ordered unsealed all of the papers filed in the state district court
18
proceeding (#644); and
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The Montgomery parties motion for protective order (#467) is GRANTED IN PART
AND DENIED IN PART as more fully set forth in this order;
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Produce documents responsive to RFP-1, Nos. 18, 19 & 20 and RFP-2, Nos. 1,
2 & 3 as limited to 1997 to the present. eTreppid shall have leave to request
11
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Produce documents responsive to RFP-1, No. 9 as limited to 1998 to the present;

and
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Produce documents responsive to RFP-1, No. 3 as limited to the full text of each
of the copyrights. eTreppid shall have leave to request documents which
14
Produce all documents responsive to RFP-1, Nos. 4, 6, 8, 16 & 22 and RFP-2,
5.
The Montgomery parties shall file a discovery status report with this court no later than
Monday, June 30, 2008, outlining its proposed timeline for compliance with this order,
notwithstanding that any party may file an objection to this order pursuant to LR IB 3-2.
IT IS SO ORDERED.
Dated: May 29, 2008
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UNITED STATES MAGISTRATE JUDGE
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DISTRICT OF NEVADA
***
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DENNIS MONTGOMERY and the

MONTGOMERY FAMILY TRUST,
Plaintiffs,
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vs.
ETREPPID TECHNOLOGIES, LLC;
WARREN TREPP; and the
UNITED STATES DEPARTMENT
OF DEFENSE,
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Defendants.
AND ALL RELATED MATTERS
)
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3:06-CV-00056-PMP-VPC
BASE FILE
3:06-CV-00145-PMP-VPC
ORDER
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On May 29, 2008, the Honorable Valerie P. Cooke, United States
20
Magistrate Judge, entered an Order Regarding Source Code Discovery (Doc. #645).
21
On June 12, 2008, Plaintiffs the Montgomery Parties filed Objections to
22
Magistrate Judges Order Regarding Source Code Discovery and Request for Stay Pending
23
Appeal (Doc. #672). By their objections, the Montgomery Parties request that this Court
24
(1) reverse the May 29 Order to the extent it (a) directs production of the Montgomery
25
Parties trade secret source code and (b) dismisses the Montgomery Parties accounting
26
claim, and (2) vacate the May 29 Order to the extent it finds that Mr. Montgomery took or
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deleted source code from eTreppids computers and/or that Judge Perry so found in
February 2006.
On June 27, 2008, Magistrate Judge Cooke entered an Order (Doc. #707)
granting a Stay of the June 30, 2008 deadline for filing a plan for production of the source
code contained in her Order (Doc. #645), pending further Order of this Court (Doc. #707).
On June 30, 2008, Defendants eTreppid Technologies, LLC and Warren Trepp filed a
Response to the Montgomery Parties objections (Doc. #715).
8
9
In accord with the provisions of 28 U.S.C. 636, and Local Rule 1B3-1 and 3-2,
the Court has reviewed the proceedings before Magistrate Judge Cooke which resulted in
10
the entry of the Order Regarding Source Code Discovery (Doc. #645). The Court finds that
11
the Montgomery Parties objections to Magistrate Judge Cookes Order must be overruled,
12
and the Order Regarding Source Code Discovery (Doc. #654) entered by Magistrate Judge
13
Cooke must be affirmed.
14
Specifically, the Court finds that discovery and analysis of the source code at
15
issue in this case is clearly relevant to the resolution of this action and that the Montgomery
16
Parties should forthwith comply with Magistrate Judge Cookes Order of production of the
17
source code. The Court further finds that Magistrate Judge Cookes determination that at
18
the February 7, 2006, preliminary injunction hearing in Nevada State Court, Judge Perry
19
found that Plaintiff Montgomery took or deleted the source code from eTreppids computer,
20
is not clearly erroneous or contrary to law. Finally, after de novo review, the Court finds
21
that dismissal of the Montgomery Parties accounting claim is warranted.
22
IT IS THEREFORE ORDERED that Plaintiffs Montgomery Parties
23
Objections to Magistrate Judges Order Regarding Source Code Discovery and Request for
24
Stay Pending Appeal (Doc. #672) are OVERRULED, and the Order Regarding Source
25
Code Discovery (Doc. #645) entered May 29, 2008, by the Honorable Valerie P. Cooke,
26
United States Magistrate Judge, is AFFIRMED.
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IT IS FURTHER ORDERED that the Stay Order (Doc. #707) entered by
Magistrate Judge Cooke on June 27, 2008, is hereby lifted and to that extent if they have
not already done so, the parties shall fully comply with Magistrate Judge Cookes Order
Regarding Source Code Discovery (Doc. #645) no later than Monday, July 21, 2008.
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DATED: July 3, 2008.
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PHILIP M. PRO
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DISTRICT OF NEVADA
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***
)
DENNIS MONTGOMERY and the
)
MONTGOMERY FAMILY TRUST,
)
)
Plaintiffs,
)
)
v.
)
)
ETREPPID TECHNOLOGIES, LLC;
)
WARREN TREPP; and the UNITED
)
STATES DEPARTMENT OF DEFENSE, )
)
Defendants.
)
)
)
AND ALL RELATED MATTERS.
)
)
3:06-CV-00056-PMP-VPC
BASE FILE
3:06-CV-00145-PMP-VPC
ORDER
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Plaintiffs having failed to show good cause to stay this Courts Order (Doc. #728)
requiring Plaintiffs to produce the source code at issue by Monday, July 21, 2008,
IT IS ORDERED that Plaintiffs Emergency Motion for Stay of Order to Produce
Source Code (Doc. #762) is hereby DENIED.
IT IS FURTHER ORDERED that Plaintiffs shall fully comply with Magistrate
21
Judge Cookes Order Regarding Source Code Discovery (Doc. #645) and this Courts
22
Order (Doc. #728) no later than July 23, 2008.
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DATED: July 21, 2008
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_______________________________
PHILIP M. PRO
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MONTGOMERY, et al.,
)
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Plaintiffs,
)
)
v.
)
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ETREPPID TECHNOLOGIES, LLC,
)
et al.,
)
)
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Defendants.
)
____________________________________)
)
AND ALL RELATED MATTERS.
)
____________________________________)
3:06-CV-00056-PMP-VPC
BASE FILE
3:06-CV-00145-PMP-VPC
ORDER TO SHOW CAUSE
12
Before the court is Dennis Montgomery (Montgomery) and the Montgomery Family
13
Trusts (the Trust) (collectively the Montgomery parties) report regarding compliance with
14
this courts May 29, 2008 order regarding source code discovery (#768).
15
I. HISTORY & PROCEDURAL BACKGROUND
16
This litigation involves a dispute between the Montgomery parties and Warren Trepp and
17
eTreppid Technologies, LLC (collectively eTreppid) over who owns the rights to certain
18
technology and trade secrets.1
19
This Order To Show Cause stems from this courts May 29, 2008 Order Regarding Source
20
Code Discovery (#645) (hereinafter Source Code Order). The Source Code Order resulted from
21
a discovery disagreement between the Montgomery parties and eTreppid over whether the trade
22
secret source code technology at issue in this case was relevant and necessary to the disposition
23
of the parties claims.2 Id. After briefing, a hearing, and supplemental briefing, this court
24
concluded that production of the source code was essential to resolving the central issues in this
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28
As this court and the parties are quite familiar with the involved history of this case, much of which
is irrelevant to the current issues before the court, the court does not set out the entire background.
2
The Montgomery parties define source code as the human readable and modifiable version of
software programs, before it is compiled into machine-readable object code (#672).
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case. Id. The court ordered, with certain limits, that the Montgomery parties produce all
documents, either in printed or electronic form, that are responsive to eTreppids outstanding
discovery requests seeking source code and other technology Montgomery claims as a trade
secret. Id. The court further stated in paragraph V.5. of the Source Code Order that the
Montgomery parties shall file a discovery status report with this court no later than Monday,
June 30, 2008, outlining its proposed timeline for compliance with this order, notwithstanding
that any party may file an objection to this order pursuant to LR IB 3-2. Id. (emphasis in
original).
On June 12, 2008, the Montgomery parties filed a paper entitled The Montgomery
10
parties objections to Magistrate Judges order re source code discovery and request for stay
11
pending appeal (#672). The Montgomery parties argued that this court had incorrectly applied
12
the law with respect to production of trade secrets and that the trade secret source code has no
13
relevance to either eTreppids trade secret misappropriation claim or the Montgomery parties
14
copyright claim. Id. They requested that the District Court reverse the Source Code Order to the
15
extent that it directs production of the Montgomery parties trade secret source code.3 Id.
16
On June 17, 2008, this court held its monthly discovery status conference. The court
17
noted for the record that while the Montgomery parties had purportedly filed for a stay of the
18
Source Code Order, the request for a stay was made only in the title of their motion, and they had
19
not articulated a basis for the stay within their objection (#700; see also transcript of hearing,
20
#733). The court advised the parties that there was no stay of the Source Code Order in place.4
21
22
Notably, the Montgomery parties continually refer to the source code as Montgomerys trade
secret. However, ownership of the source code is a central issue in the case.
23
4
During the June 17, 2008 hearing, this court stated:
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27
28
The court, of course, is aware that the Montgomery parties filed an

objection to this Courts order regarding Source Code. That objection is
docket number 672. And, of course, as everyone is aware, that objection
will be considered by Judge Pro.
The issue that I want to bring to everyones attention is that, in the
title of that objection, there is a request for stay pending appeal. But I
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Id.
On June 20, 2008, the Montgomery parties filed a motion for an order shortening time for
hearing or other resolution of their motion for a stay of compliance with the Source Code Order
pending resolution of their objections to the Source Code Order (#692; see also #693). In that
motion, the Montgomery parties acknowledged the discussion with this court during the June 17
status conference that a stay was not currently in place. Id. The Montgomery parties stated that
the Source Code Order directed the Montgomery parties to produce enormous amounts of
extremely sensitive trade secret information in contravention of controlling Ninth Circuit
authority and to begin that process prior to June 30. Id. They further argued that such
10
compliance would irreparably harm the Montgomery parties both by prejudicing them in the
11
litigation and by imposing enormous financial costs on them because their objections to the
12
Source Code Order then pending before the District Court would not be addressed until after
13
June 30, 2008, and would, therefore, be mooted without a stay in place. Id.
14
On June 24, 2008, this court granted the Montgomery parties motion for order shortening
15
time on motion for stay of the Source Code Order, and requiring briefing completed by July 1,
16
2008 (#697). The Montgomery parties filed a second motion requesting an Order continuing the
17
June 30, 2008 deadline for compliance with the Source Code Order because although this court
18
had granted their motion shortening time, the motion for a stay of compliance with the Source
19
Code Order would not be resolved prior to the June 30, 2008 deadline for compliance set out in
20
the Source Code Order (#703). Again, the Montgomery parties noted that compliance with the
21
Source Code Order by June 30, 2008 would cause significant irreparable prejudice and
22
enormous financial costs on them. Id. eTreppid opposed the motion, arguing that compliance
23
reviewed the objection to ascertain whether there was a basis articulated in
that objection for a stay, and there is not. The only reference to a request
for a stay is simply in the title, as far as I can tell.
24
25
26
And so as far as this court is concerned, with respect to the Source

Code order, there is no stay in effect. And unless and until such stay is
granted, the obligation to comply with that order is one that is outstanding.
27
28
(#733, p. 4).
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with the Source Code Order would not cause harm to the Montgomery parties because the Source
Code Order did not set a date for production of the source code, it merely required the
Montgomery parties to file a discovery status report by June 30, 2008 outlining its proposed
timeline for compliance with the Source Code Order (#704).
On June 27, 2008, this court granted the continuance, stating: The June 30, 2008 deadline
for filing a plan for production of source code contained in the order regarding source code
discovery (#645) is STAYED pending further order of this court (#707) (emphasis in original).
On July 3, 2008, the District Court issued an order overruling the Montgomery parties
objections and affirming this courts Source Code Order (#728). In its order, the District Court
10
stated that the discovery and analysis of the source code at issue in this case is clearly relevant
11
to the resolution of this action and the Montgomery Parties should forthwith comply with
12
Magistrate Judge Cookes order of production of the source code. Id. The court lifted the June
13
27, 2008 stay order (#707) and ordered that to the extent that they have not already done so, the
14
parties shall fully comply with Magistrate Judge Cookes Order Regarding Source Code
15
Discovery (Doc. #645) no later than Monday, July 21, 2008. Id.
16
On July 15, 2008, this court held another discovery status conference. The Montgomery
17
parties informed this court that they would like to modify the existing trade secret protective order
18
but that eTreppid would not agree to a modification (#760). As such, the Montgomery parties
19
were considering filing a motion to request that either a special master be appointed to oversee
20
the trade secret discovery, or that the protective order be modified. Id. The court stated that if
21
the Montgomery parties intended to file such a motion, they could do so within the next week,
22
and that the motion would be briefed in the normal course. Id. The court specifically noted that
23
the current protective order remained in place. Id.
24
On July 18, 2008, the Montgomery parties filed an emergency motion for a stay of the
25
Source Code Order to the extent it requires production of source code so that they could seek
26
Ninth Circuit review of the Source Code Order via a Writ of Mandamus (#762).
27
Montgomery parties requested that the stay remain in place until the Ninth Circuit ruled on their
28
Writ (which they stated they anticipated filing on July 21, 2008), or alternatively, until this court
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Id.
ruled on their yet-to-be-filed motion to modify the protective order.
Although the
Montgomery parties acknowledged that the District Court had disagreed with their objections to
the Source Code Order that the production of the source code was not necessary to the
resolution of this case, the Montgomery parties stated that they were compelled to request review
of that decision by the Ninth Circuit because the Courts ruling threatens plaintiffs with the
irreparable loss of the very rights they brought this action to defend. Id.
On July 21, 2008, the District Court denied the Montgomery parties emergency motion
for a stay of the Source Code Order, and ordered that the Montgomery parties fully comply with
Magistrate Judge Cookes Order Regarding Source Code Discovery (Doc. #645) and this Courts
10
Order (Doc. #728) no later than July 23, 2008 (#765).
11
On July 23, 2008, the Montgomery parties filed the notice presently before the court
12
(#768). In their notice, the Montgomery parties inform the court that they construe paragraph
13
V.5. of the Source Code Order as seeking a timeline for compliance to produce the source code
14
at issue. Id. The Montgomery parties state that they are in possession of electronic files
15
responsive to some of eTreppids discovery requests with respect to CD No. 1, that they are
16
diligently searching millions of files, and that they expect to be able to comply with the Source
17
Code Order by October 30, 2008. Id.
18
The Montgomery parties further state that with respect to the source code developed by
19
Montgomery in the fields of object tracking, pattern recognition, and anomaly detection created
20
in or after 1998, which the Montgomery parties contend was never transferred to eTreppid
21
pursuant to the Contribution Agreement, they will not be producing such documents. Id. The
22
Montgomery parties state that they respectfully disagree with this court and the District Courts
23
orders, and that they intend to file a Writ of Mandamus with the Ninth Circuit to vacate the
24
Source Code Order to the extent it requires production of source code related to object tracking,
25
pattern recognition, and anomaly detection. Id. They further note that they intend to seek a stay
26
of the Source Code Order pending a determination of the Writ Petition. Id.
27
Finally, the Montgomery parties inform the court that they intend to seek a modification
28
to the protective order in this case, and state that if their Writ to the Ninth Circuit is denied, they
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will only produce the source code related to object tracking, pattern recognition, and anomaly
detection 30 days after there has been a final determination on the Montgomery parties motion
to modify the protective order. Id. They further inform the court that any such production will
be pursuant to the terms of the protective order then in effect. Id.
II. DISCUSSION
The court first notes that the Montgomery parties have taken a contrary position to their
prior contention with respect to what is required of them pursuant to the Source Code Order. In
at least three filings with this court, the Montgomery parties stated that it was their understanding
that the Source Code Order required them to start producing actual source code by June 30, 2008.
10
See #692, #693, and #703. The pattern and practice of the Montgomery parties in this case to
11
take whatever position suits their needs at that immediate moment makes their current
12
sentiments appear extremely disingenuous. As the participants in this case are all aware, this type
13
of flip-flopping has occurred over and over with respect to the Montgomery parties compliance
14
with this courts discovery orders.
15
In drafting the Source Code Order, this court was very aware of the complicated
16
undertaking it was requiring of the Montgomery parties, and it endeavored to be reasonable about
17
the Montgomery parties compliance. However, even if the court were to construe as genuine the
18
Montgomery parties interpretation of the Source Code Order as merely requiring a timeline, the
19
notice before the court would be completely deficient. The Montgomery parties notice does not
20
set a proposed timetable or a plan delineating steps and intermediate deadlines by which they
21
would successfully comply with Source Code Order.
22
interpretation of the Source Code Order and successive court orders, and then sets their own
23
deadline for production. The Montgomery parties have been on notice that these documents
24
might be subject to discovery since mid-2006, but at the very least, by November 2007 (#431).
25
Once again, they protest that they do not have enough time.
Their notice simply states their
26
Moreover, in complete defiance of three court orders requiring the production of source
27
code related to object tracking, pattern recognition, and anomaly detection, the Montgomery
28
parties state that they respectfully disagree. Notably, the Montgomery parties have continually
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informed this court that they intend to file a Writ with the Ninth Circuit to vacate the Source
Code Order. To this courts knowledge, this has not been done. Further, although they have
already sought and been denied a stay from the District Court pending appeal to the Ninth Circuit,
the Montgomery parties purport to grant themselves a stay in their notice by stating that they will
not produce any documents related to object tracking, pattern recognition, and anomaly detection
until after the Ninth Circuit has made a determination on their unfiled Writ. Finally, the court
notes that despite their assertions, the Montgomery parties have yet to request a modification of
the protective order.
It is quite clear to both this court and the District Court that the Montgomery parties
10
notice of compliance represents their intent to defy the courts orders by any means necessary.
11
III. CONCLUSION
12
Based on the foregoing and for good cause appearing:
13
IT IS HEREBY ORDERED that a hearing to show cause as to why the Montgomery
14
parties and Deborah A. Klar, counsel for the Montgomery parties, should not be held in contempt
15
for failure to comply with the Source Code Order is set for Monday, August 18, 2008, at 10:00
16
a.m.;
17
18
19
20
IT IS FURTHER ORDERED that Dennis Montgomery shall appear in person at the

hearing to show cause and be prepared to testify as to the matters at issue in this order;
IT IS FURTHER ORDERED that Deborah A. Klar shall appear in person at the hearing
to show cause and be prepared to address the matters at issue in this order;
21
IT IS SO ORDERED.
22
DATED: July 24, 2008.
23
24
______________________________________
UNITED STATES MAGISTRATE JUDGE
25
26
27
28
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DISTRICT OF NEVADA
RENO, NEVADA
)
)
Plaintiff(s),
)
)
vs.
)
)
ETREPPID TECHNOLOGIES,
)
et al.,
)
)
Defendant(s).
)
______________________________)
3:06-CV-0056-PMP-VPC
MINUTES OF PROCEEDINGS
DATED: August 18, 2008
PRESENT: THE HONORABLE PHILIP M. PRO, U.S. DISTRICT JUDGE

PRESENT: THE HONORABLE VALERIE P. COOKE, U.S. MAGISTRATE JUDGE
Deputy Clerk:
Lisa Mann
Court Reporter:
Kathryn M. French
Counsel for Plaintiff(s): Randall Sunshine, Ellyn Garofalo, and Mark Gunderson
Counsel for Defendant(s): Stephen Peek and Jerry Snyder
Counsel for Counter Defendant(s): Robert Rohde, Gregory Schwartz, Roland Tellis, and Bridgett
Robb Peck
Counsel for Interested Party: Carlotta Wells
PROCEEDINGS: CASE MANAGEMENT CONFERENCE AND SHOW CAUSE HEARING
10:04 a.m. Court convenes.
The District Court addresses the parties regarding the purpose of this proceeding.
On August 12, 2008, Atigeo and Michael Sandoval filed their case management report
(#796), eTreppid Technologies, LLC and Warren Trepp filed their case management report (#797),
and the plaintiffs, Edra Blixseth, and OpSpring LLC filed their case management report (#799).
1.
First Phase Deposition Discovery:

A first phase of depositions shall include the depositions of Dennis Montgomery,
Warren Trepp, Edra Blixseth, and Michael Sandoval, in that order, and shall be taken
and completed no later than Friday, October 31, 2008. The parties shall have leave
to take a second round of depositions of these parties pursuant to further order of the
Court.
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Dennis Montgomery, et al., v. eTreppid Technologies, LLC, et al.

August 18, 2008
Page 2
Counsel who intent to submit exhibits at the depositions of the four persons
identified herein shall submit all exhibits ten (10) business days prior to a deposition
to counsel for the Department of Justice for review pursuant to the United States
protective order (#253).
2.
Settlement conference:
Counsel shall meet and confer and file a joint proposal concerning potential
Alternative Resolution Dispute options by no later than Friday, August 29, 2008.
The Magistrate Court advises the parties that it shall now discuss with counsel the directives
of the Court as ordered at the last discovery status conference held on July 15, 2008 (#760).
3.
Production of compact discs (CDs) by the Montgomery parties:

Mr. Peek advises the Court that he is in receipt of twenty-one hard drives, but that
thirteen of the twenty-one hard drives are unreadable, and no CDs have been
produced. Mr. Sunshine advises the Court that he will look into the problem
concerning the unreadable hard drives and correct the problem. With respect to CDs,
Mr. Sunshine reports that he is unaware of the status of any CDs. IT IS ORDERED
that Mr. Sunshine shall resolve the problem concerning the thirteen unreadable hard
drives and produce these hard drives by no later than Wednesday, August 27, 2008.
With respect to CDs which were the subject of the July 15, 2008 discovery status
conference, Mr. Sunshine shall produce these CDs by no later than Friday, August
29, 2008.
4.
The Montgomery parties request for a bates-number range and indication of

those eTreppid documents responsive to specific requests for production of
documents:
Counsel advise the Court they have undertaken and agreed upon a protocol for a
bates-number range for eTreppid to identify documents, which are responsive to
specific requests for production propounded by the Montgomery parties. To the
extent further issues arise, counsel advise they will resolve such issues without the
Courts intervention.
5.
Montgomery parties request for production including a privilege log:

eTreppids counsel advise the Court that eTreppids privilege log is completed.
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August 18, 2008
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6.
Dispute regarding OpSprings request for production of documents: Outputs:

The Court notes for the record that at the July 15, 2008 discovery status conference,
the Court indicated that OpSpring has leave to file a motion to compel and to date no
such motion has been filed.
7.
Deposition of Sue Perez:

Counsel advises the Court they are still attempting to schedule this deposition.
However, in light of phase one depositions ordered by the Court today, Mr. Sunshine
suggests that the parties postpone Ms. Perezs deposition until after these depositions
are completed. The Court directs counsel to meet and confer during the break and
report back to the Court concerning this issue.
8.
Montgomery parties production of a privilege log to all counsel and an in

camera privilege log to the Court:
The Court requests a copy of the privilege log concerning the common interest
agreement that the Montgomery parties provided to counsel. Mr. Peek provides the
court clerk with a copy. The court clerk is directed to make copies for the court and
all counsel and advises counsel that it shall address this matter after the order to show
cause matter is addressed.
9.
Joint proposal regarding a discovery plan and scheduling order:

The District Court directs counsel to meet and confer during this week to refine their
proposed deadlines regarding a joint proposed discovery plan and scheduling order
including a rebuttal discovery deadline and a deadline to amend pleadings and add
parties. Thereafter, this joint proposal can be addressed and finalized by the
Magistrate Court later this week.
11:16 a.m. Court recesses.

11:30 a.m. Court reconvenes.
The District Court advises counsel that it shall now address the order to show cause issued
on July 24, 2008 (#769).
The District Court notes for the record that on May 29, 2008, the Magistrate Court entered
an order regarding source code discovery (#645) and recites the chronology of events which
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August 18, 2008
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transpired thereafter, including the District Courts last order on this issue (#765) entered July 21,
2008, which denied the plaintiffs emergency motion for stay of order to produce source code and
directed plaintiffs to fully comply with Magistrate Judge Cookes order regarding source code
discovery (#645) and this Courts order (#728), no later than July 23, 2008. The District Court
further notes that rather than comply, the Montgomery parties filed a document entitled, The
Montgomery Parties Report Re Compliance with Courts May 29, 2008 Order Regarding Source
Code Discovery (#768), which precipitated the Magistrate Courts order to show cause issued on
July 24, 2008 (#769).
Mr. Sunshine advises the Court that the Montgomery parties filed a supplemental report
regarding source code production (#793) and represents to the Court that the Montgomery parties
will produce all source code it their possession by no later than Monday, September 8, 2008.
Having heard from counsel for the Montgomery parties, the District Court finds that it is
appropriate to impose a monetary penalty against Dennis Montgomery for his failure to comply with
the repeatedly clear orders of the District Court and Magistrate Court.
THEREFORE, IT IS ORDERED that a monetary contempt sanction is imposed against
Dennis Montgomery in the amount of two thousand five hundred dollars ($2,500.00) per day from
the date of the failure to comply, July 23, 2008, through the date the production actually occurs.
IT IS FURTHER ORDERED that this sanction shall remain in place until a declaration by
Dennis Montgomery and his counsel file a declaration with the Clerk of the Court certifying that the
source code production is complete.
The Magistrate Court advises the parties that it shall next address the following matters:
1)
The Montgomery parties privilege log provided to eTreppid and other counsel
concerning the common interest privilege;
2)
The Montgomery parties motion to compel and order to show cause with respect to
business records by eTreppid (#684); and
3)
OpSprings motion to compel production of Mr. Trepps tax return (#726).
Mr. Peek makes an oral request to submit an application for attorneys fees and costs for
eTreppids efforts to obtain source code discovery.
The District Court advises that the twenty-five hundred dollar a day sanction is payable
ultimately to eTreppid Technologies, LLC; however, the Court shall allow eTreppids counsel to file
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August 18, 2008
Page 5
a motion and declaration that addresses the efforts made since Magistrate Judge Cookes May 29,
2008 order.
IT IS SO ORDERED.
11:57 a.m. Court adjourns.
LANCE S. WILSON, CLERK
By:
/s/
Lisa Mann, Deputy Clerk
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EXHIBIT 9
Case 1:14-cv-01832-JEB
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MIDDLE DISTRICT OF FLORIDA
OCALA DIVISION
FREEDOM WATCH, INC.,
Plaintiff,
v.
Case No: 5:13-cv-419-Oc-22PRL
U.S. DEPARTMENT OF STATE,

Defendant.
ORDER
This cause comes before the Court on Defendant United States Department of States (the
State Department) Renewed Rule 60 Motion Seeking Relief from Orders Denying Defendants
Motion to Dismiss, filed on October 7, 2014. (Doc. No. 33). Plaintiff Freedom Watch, Inc.
(Plaintiff) filed a response in opposition. (Doc. No. 34). For the reasons set forth below, the
Court grants the State Departments motion and transfers this action to the United States District
Court for the District of Columbia.
I. BACKGROUND
Initially, the Court sets forth the somewhat unusual procedural history of this case. On
September 4, 2013, Plaintiff filed a single-count Complaint against the State Department1
alleging a violation of the Freedom of Information Act (FOIA), 5 U.S.C. 552 et seq. (Doc.
No. 1).2 Plaintiff alleges that it sent a FOIA request to the State Department in May of 2013
On July 2, 2014, the Court dismissed Plaintiffs claims against the United States Department of
the Treasury (the Treasury Department). (See Doc. No. 22).
2
This Order employs the following citation conventions: documents filed in the current case
docket are cited only as (Doc. No. __ ).; citations to documents in other cases or courts are preceded by
a full case citation and followed by (Doc. No. __ ).
Document 94-9
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seeking to obtain records that referred or related in any way to decisions to grant waivers to
countries dealing with the Islamic Republic of Iran. (Id. at 4). In its Complaint, Plaintiff states
that its principal place of business is 2775 NW 49th Ave, Suite 205-345, Ocala, Florida
34482. (Id. at 2).
Shortly after Plaintiff filed its Complaint, the State Department filed a motion to dismiss
Plaintiffs claim against it for improper venue. (See Doc No. 14). The State Department sought
dismissal entirely based on this Courts prior Order in Freedom Watch, Inc. v. Obama, Case No.
5:13-cv-26-Oc-22PRL (M.D. Fla. Nov. 15, 2013), (Doc. No. 31) (finding that Freedom Watch,
Inc., the same plaintiff as in this case, did not reside in the Middle District of Florida for the
purposes of 28 U.S.C. 1391(e) because Plaintiff was incorporated in the District of Columbia
and not in Florida).3 However, the Court pointed out that venue for civil actions alleging a FOIA
violation, such as this one, is governed by 5 U.S.C. 552(a)(4)(B)4 and not the general venue
provision found at 28 U.S.C. 1391(e). (Doc. No. 16 at pp. 5-6). In addressing this issue, the
Court stated:
The Court does, however, note its skepticism as to whether the address Plaintiff
3
The Court takes judicial notice of all pleadings, filings, and orders in its previous cases. Fed. R.
Evid. 201(b), (c); United States v. Rey, 811 F.2d 1453, 1457 n.5 (11th Cir. 1987) (A court may take
judicial notice of its own records . . . .).
4
Section 552(a)(4)(B) instructs:
On complaint, the district court of the United States in the district in which the
complainant resides, or has his principal place of business, or in which the agency records
are situated, or in the District of Columbia, has jurisdiction to enjoin the agency from
withholding agency records and to order the production of any agency records improperly
withheld from the complainant.
5 U.S.C. 552(a)(4)(B); see also Lykins v. U.S. Dept of Justice, 725 F.2d 1455, 1462 n.7 (D.C. Cir.
1984) (stating that Congress explicitly laid venue in FOIA cases in the courts outlined in
552(a)(4)(B)); In re Scott, 709 F.2d 717, 720 (D.C. Cir. 1983) (describing 552(a)(4)(B) as the
applicable FOIA venue provision). Thus, venue for civil actions alleging a FOIA violation can lie in the
district in which the complainant has its principal place of business, language that is not present in the
general venue statute found at 28 U.S.C. 1391(e).
-2-
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provides truly is Plaintiffs principal place of business. See Freedom Watch,

Inc. v. Obama, Case No. 5:13-cv-26-Oc-22PRL (M.D. Fla. June 24, 2013), (Doc.
No. 25 at p. 3) (stating that exhibits presented in Freedom Watch, Inc. v. Obama
strongly suggest that Plaintiffs Ocala headquarters is a post office box at a
UPS store.). The Florida Division of Corporations public records list an address
in Washington, D.C. as Plaintiffs principal address and mailing address. As
noted in the Courts prior Order, The only Florida address contained in the
Division of Corporations records for Plaintiff is that of its registered agent, Larry
Klayman; that address appears to be the same post office box Plaintiff offered as
its principal place of business the first time the Court considered the venue
issue. See id., (Doc. No. 31 at p. 3).
Nonetheless, venue is decided based on the facts at the time the Complaint is
filed. [Flowers Indus., Inc. v. FTC, 835 F.2d 775, 776 n.1 (11th Cir. 1987) (per
curiam) (citations omitted)]. The instant lawsuit commenced almost eight months
after Freedom Watch Inc. filed its complaint in Freedom Watch, Inc. v. Obama,
and more than two months after the Court dismissed the complaint in that case.
Without a proper challenge to venue, the Court must accept the facts as true in
Plaintiffs Complaint. Here, Plaintiff argues that Freedom Watch relocated its
principal place of business to Ocala, Florida. (Doc. No. 15 at p. 5). While the
Court may consider matters outside of the pleadings, conflicts between allegations
in the complaint and evidence outside the pleadings must be resolved in favor of
the plaintiff. [Wai v. Rainbow Holdings, 315 F. Supp. 2d 1261, 1268 (S.D. Fla.
2004)]. Because [the State Department] did not properly challenge venue, and
because the Court resolves any conflict in favor of Plaintiff, Defendants Joint
Motion to Dismiss is denied.
(Doc. No. 16 at p. 7) (some citations altered).
Soon thereafter, the State Department filed its Motion Seeking Relief from Order
Denying Defendants Motion to Dismiss. (Doc. No. 20). There, the State Department suggested
that Plaintiff had misrepresented the basis for venue in this case. (Id. at pp. 2-3). The State
Department argued that just three months after making the representation to this Court that
Plaintiff had relocated its principal place of business to Ocala, Florida, Plaintiff made the
following allegation in another Complaint filed in the United States District Court for the District
of Columbia: Plaintiff Freedom Watch is a non-profit, public interest foundation organized

under the laws of the District of Columbia and having its principal place of business at 2020
-3-
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Pennsylvania Ave., NW Suite 345, Washington, DC, 20006. (See Doc. No. 20-1 at p. 2, 2)
(emphasis added).5 The State Department argued that this was clearly contradictory to
Plaintiffs earlier representations to this Court and therefore the Court should set aside its prior
Order. (Doc. No. 20 at p. 2).
In addressing the State Departments motion, the Court noted that although an
explanation was relegated to a footnote on the last page of Plaintiffs response, Plaintiff
represented that it
based the language of the complaint in Freedom Watch v. CIA on a previous
complaint that was filed during the time that Plaintiffs principal place of business
was at 2020 Pennsylvania Ave., NW Suite 345, Washington, DC 20006. Plaintiff
will amend the complaint in Freedom Watch v. CIA to make clear that its personal
[sic6] place of business is now in Ocala, Florida.
(Doc. No. 23 at pp. 2-3); (Doc. No. 21 at p. 5 n.2).
The Court specifically questioned why it is so difficult for Plaintiff to allege its principal
place of business. (Doc. No. 23 at p. 3). Indeed, the Court had previously noted in this case its
skepticism as to whether the address Plaintiff provides truly is Plaintiffs principal place of
business. (See Doc. No. 16 at p. 7). The Court therefore stated that it still maintains a skepticism
See Complaint, Freedom Watch v. Central Intelligence Agency, Case No. 1:14-cv-472-RJL
(D.D.C. Mar. 21, 2014), (Doc. No. 1 at 2).
The Court also takes judicial notice of the cases cited in this Order from the United States District
Court for the District of Columbia as they are public records not subject to reasonable dispute because
they can be accurately and readily determined from sources whose accuracy cannot reasonably be
questioned. Fed. R. Evid. 201(b); see also Universal Express, Inc. v. S.E.C., 177 F. Appx 52, 53 (11th
Cir. 2006) (per curiam) (citing Stahl v. U.S. Dept of Agric., 327 F.3d 697, 700 (8th Cir. 2003)).
Unpublished opinions in this Circuit are not considered binding, but may be cited as persuasive authority.
See 11th Cir. R. 36-2.
6
Clearly, Section 552(a)(4)(B) contains no language permitting a complainant to file a FOIA

complaint in the district court of the United States in the district in which the complainant (or its counsel)
has its (or his) personal place of business. Perhaps this seemingly Freudian slip sheds light on how
Plaintiffs counsel believes 5 U.S.C. 552(a)(4)(B) should read: the location Plaintiffs counsel happens
to be personally conducting business that day.
-4-
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about Plaintiffs multiple representations. (Doc. No. 23 at p. 3). However, based on Plaintiffs
explanation, the Court was not clearly convinced that Plaintiff deliberately misrepresented the
basis for venue so as to afford the relief the State Department sought under Rule 60. (Id.).
Today, the Court reaches a different conclusion.
II. LEGAL STANDARD
Federal Rule of Civil Procedure 60 states: On motion and just terms, the court may
relieve a party or its legal representative from a final judgment, order, or proceeding for the
following reasons: . . . fraud (whether previously called intrinsic or extrinsic), misrepresentation,
or misconduct by an opposing party . . . . Fed. R. Civ. P. 60(b)(3). To prevail on a 60(b)(3)
motion, the movant must prove by clear and convincing evidence that an adverse party has
obtained the verdict through fraud, misrepresentation, or other misconduct. Cox Nuclear
Pharmacy, Inc. v. CTI, Inc., 478 F.3d 1303, 1314 (11th Cir. 2007) (citation and internal brackets
omitted); see also, e.g., Booker v. Dugger, 825 F.2d 281, 283 (11th Cir. 1987) (Where relief
from a judgment is sought for fraud on the court, the fraud must be established by clear and
convincing evidence.). Additionally, the moving party must show [ ] that the conduct
prevented the losing party from fully and fairly presenting his case or defense. Cox Nuclear,
478 F.3d at 1314 (citation omitted).
III. DISCUSSION
A. Improper Venue
Plaintiffs multiple representations throughout this proceeding can no longer be
countenanced by this Court. As discussed more fully below, the State Department has come
forward with new information which demonstrates, both clearly and convincingly, that Plaintiff
has deliberately misrepresented the basis for venue in this case.
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First, contrary to its previous representation to this Court that it would amend the
complaint in Freedom Watch, Inc. v. Central Intelligence Agency, Case No. 1:14-cv-472-RJL
(D.D.C. Mar. 21, 2014), Plaintiff has failed to do so. (See Doc. No. 21 at p. 5) (Freedom
Watchs principal place of business is not in the District of Columbia . . . . Plaintiff will amend
the language in Freedom Watch v. CIA to reflect the fact that Plaintiffs principal place of
business is indeed now located in Ocala, Florida.). Although certainly not dispositive of the
question at hand, this, at the very least, demonstrates Plaintiffs say one thing and do another
approach to this litigation. Consequently, Plaintiffs representations to the Court carry little, if
any, water. This is particularly true in light of the fact that Plaintiff knew that the Court already
held a skepticism of Plaintiffs multiple representations. (See Doc. No. 23 at p. 3).
Incredibly, and of greater significance to the question at hand, Plaintiff filed yet another
lawsuit in the United States District Court for the District of Columbia where it again alleges that
its principal place of business is in Washington, DC: [Plaintiff Freedom Watchs] principal
place of business [is] at 2020 Pennsylvania Ave., NW Suite 345, Washington, DC, 20006. See
Complaint, Freedom Watch, Inc. v. National Security Agency et al., Case No. 1:14-cv-1431-RJL
(D.D.C. Aug. 21, 2014), (Doc. No. 1 at 3). Notably, Plaintiff made this allegation just a month
and a half after Plaintiff represented to this Court that its principal place of business was in fact
Ocala, Florida. (See Doc. No. 21) (filed with this Court on June 30, 2014).7 In response to this
now second motion to set aside the Courts prior order, Plaintiff again argues that it simply
made a mistake in asserting its principle [sic] place of business. (Doc. No. 34 at p. 2). Plaintiff
again represents to the Court that it accidentally stated that its principal place of business was
7
By signing a pleading, an attorney certifies, inter alia, that to the best of his or her knowledge,
information, and belief, formed after an inquiry reasonable under the circumstances, the allegations and
factual contentions in the pleading have evidentiary support. Fed. R. Civ. P. 11(b).
-6-
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at 2020 Pennsylvania Ave, NW Suite 345, Washington, DC, 20006, in Freedom Watch v. NSA,
14-cv-01431-RJL, which Plaintiff filed a few months after filing suit in this case. (Id.).
It is hard for the Court to credit any of Plaintiffs representations. The Court takes note
that Plaintiffs response makes no argument whatsoever suggesting that it made any attempt at
all to amend its complaint in Freedom Watch, Inc. v. Central Intelligence Agency, as it
previously indicated to the Court that it would. (See Doc. No. 34 at pp. 2-3). As well, Plaintiffs
opposition to the instant motion does not indicate in any way that Plaintiff would seek to remedy
its mistaken principal place of business allegation in its newest case filed in the District Court
for the District of Columbia. (See id.).
Based solely on the foregoing, Plaintiffs assertions might still be deemed credible
enough so as not to rise to the high threshold of clear and convincing evidence. However, other
representations Plaintiff made in this case completely undermine any believability Plaintiff
maintained with the Court. Early in this case, on December 12, 2013, Plaintiff represented to the
Court that Freedom Watch, now located in Ocala, Florida, decided to stop filing in the District
of Columbia . . . . (Doc. No. 15 at p. 5). Plaintiff went on to say that it has not filed a single
case within the District of Columbia for nearly a year because the federal courts there have
become highly politicized and extremely slow in rendering decisions. (Id.). Of course, just three
months later, Plaintiff filed its complaint in Freedom Watch v. Central Intelligence Agency, Case
No. 1:14-cv-472-RJL (D.D.C. Mar. 21, 2014), in the District of Columbia. Just five months after
that, Plaintiff proceeded to file another complaint in that court. See Freedom Watch v. National
Security Agency et al., Case No. 1:14-cv-1431-RJL (D.D.C. Aug. 8, 2014). The operative
Complaints in those casesto this daymaintain that Plaintiffs principal place of business is in
Washington, DC.
-7-
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In light of the Courts previous questioning of why it is so difficult for Plaintiff to allege
its principal place of business, coupled with this Courts twice noting its skepticism about
Plaintiffs disparate representations, it is simply not believable that Plaintiff again made a
mistake in asserting its principle [sic] place of business. (Doc. No. 34 at p. 2).8 Notably, this is
the only argument Plaintiff advances in response to the State Departments renewed motion to
set aside the Courts prior Order. (See Doc. No. 34).
In short, the Court is now clearly convinced that Plaintiff misrepresented the basis for
venue in this case. As noted in the Courts prior Order, the only reason the Court found venue to
be proper in this action is because Plaintiff alleged in its Complaint that its principal place of
business was in Ocala, Florida, which the Court had to accept as true. (Doc. No. 16 at p. 7).
Based on the foregoing discussion, this misrepresentation is now completely discredited by the
Court. See Cox Nuclear, 478 F.3d at 1314. Furthermore, Plaintiffs conduct prevented the State
Department from fully and fairly presenting its case because the Court relied solely on this
misrepresentation in arriving at its finding that venue in this case is proper. See id. Therefore, the
Court now finds that the Middle District of Florida is an improper venue for this action and the
Court sets aside its contrary finding from its April 14, 2014 Order. (Doc. No. 16).
B. Transfer to the District Court for the District of Columbia
When venue is improper, the Court may dismiss the case, or if it is in the interest of
justice, transfer such case to any district or division in which it could have been brought. 28
U.S.C. 1406(a). Pursuant to 5 U.S.C. 552(a)(4)(B) an agency may be sued in the District of
Columbia. The District Court for the District of Columbia has explained that [u]nder the FOIA
The Court also notes that Plaintiff has never directly addressed the contention that Plaintiffs
Ocala headquarters may well be a post office box at a UPS store.
-8-
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venue statute, 5 U.S.C. 552(a)(4)(B), venue is always proper in the District of Columbia. Boggs
v. United States, 987 F. Supp. 11, 18 n.4 (D.D.C. 1997). Further, the Eleventh Circuit has stated
that the decision whether to transfer a case is left to the sound discretion of the district court.
Roofing & Sheet Metal Servs., Inc. v. La Quinta Motor Inns, Inc., 689 F.2d 982, 985 (11th Cir.
1982). Generally, transfers based on the interest of justice are favored over the dismissal of
actions. El v. Belden, 360 F. Supp. 2d 90, 93 (D.D.C. 2004) (citing, among others, Goldlawr,
Inc. v. Heiman, 369 U.S. 463, 466, 82 S.Ct. 913, 8 L.Ed.2d 39 (1962)).
The Court sees no reason why this case should not be litigated in the United States
District Court for the District of Columbia. Indeed, Plaintiff maintains its principal place of
business in that districtaccording to its filings thereand is currently litigating at least two
other FOIA cases in that court. Therefore, in the interest of justice, and instead of outright
dismissal, the Court transfers this action to the United States District Court for the District of
Columbia.
IV. CONCLUSION
Based on the foregoing, it is ordered as follows:
1. Defendant United States Department of States Renewed Rule 60 Motion Seeking
Relief from Orders Denying Defendants Motion to Dismiss, filed on October 7,
2014 (Doc. No. 33), is GRANTED.
2. The Courts Order Denying the State Departments Motion to Dismiss, filed on
April 14, 2014 (Doc. No. 16), is SET ASIDE to the extent that the Court found
the Middle District of Florida to be the proper venue for this case. The Court now
finds that venue is improper in the Middle District of Florida.
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Page 10 of 10
Page 11 of 11
3. In the interest of justice, and pursuant to 28. U.S.C. 1406(a), this case is hereby
TRANSFERRED to the United States District Court for the District of
Columbia.
4. The Clerk is directed to CLOSE this case.
DONE and ORDERED in Chambers, in Orlando, Florida on October 27, 2014.
Copies furnished to:

Counsel of Record
Unrepresented Parties
- 10 -
EXHIBIT 10
Case 1:15-cv-20782-JEM Document 94-10Capital

Entered
on FLSD
Docket 08/04/2015 Page 2 of 8
Reporting
Company
IN THE UNITED STATES TAX COURT

___________________________________________________
In the Matter of:
)
)
DENNIS L. MONTGOMERY & BRENDA K. )
MONTGOMERY,
)
)
Petitioner,
)
)
v.
) Docket No: 9008-09
)
COMMISSIONER OF INTERNAL REVENUE,)
)
Respondent.
)
Pages:
1 through 47
Place:
Los Angeles, California
Date:
February 23, 2015
(866) 448 - DEPO
DLM-023475
www.CapitalReportingCompany.com
2015

Entered
on FLSD
Reporting
Company
1
1
2
3
4
5
6
7
8
IN THE UNITED STATES TAX COURT

___________________________________________________
In the Matter of:
)
)
DENNIS L. MONTGOMERY & BRENDA K. )
MONTGOMERY,
)
)
Petitioner,
)
)
v.
) Docket No: 9008-09
)
COMMISSIONER OF INTERNAL REVENUE,)
)
Respondent.
)
Room 1167, Edward R. Roybal

Center & Federal Building
255 E. Temple Street
Los Angeles, California
10
11
February 23, 2015

12
The above-entitled matter came on for
13
calendar call, pursuant to notice, at 11:35 a.m.
14
BEFORE:
HONORABLE MARK V. HOLMES

Judge
15
16
APPEARANCES:
17
For the Petitioner:
18
DENNIS MONTGOMERY, pro se
19
For the Respondent:
20
BLAKE J. CORRY, Esquire

Office of Chief Counsel
24000 Avila Rd.
Laguna Niguel, California 92677
949-360-3430
21
22
23
24
25
(866) 448 - DEPO
DLM-023476
2015

Entered
on FLSD
Reporting
Company
34
MR. CORRY:
It's tab number 2.
THE COURT:
It's tab number 2.
Okay.
As I
said, I got this just now.
will certainly be generous with deadlines and that
kind of thing with you, Mr. Montgomery.
6
7
MR. MONTGOMERY:
Well, I
Were you able to read Dr.
Lynn's?
8
9
Oh, here we go.
THE COURT:
Yes, now that my attention is
directed to it.
10
MR. MONTGOMERY:
I can substantiate -- Your
11
Honor, I have not been able to work since May.
12
been put on full disability because of the injury
13
that has occurred to me.
14
payments from the government.
15
financially and destroyed by this attack on me by the
16
government.
17
THE COURT:
I've
I'm living on my disability

I've been wiped out
Well, first I've got to figure
18
out how much, if anything, you owe, and then the
19
question of whether they can come after you to get
20
anything is a separate issue.
21
22
Why are you in Seattle, Washington?
What's
your connection to Washington State?
23
MR. MONTGOMERY:
Well, I had a stroke up
24
here.
25
Washington, and I had the stroke up here, Your Honor.
I had a house both in California and in
(866) 448 - DEPO
DLM-023509
2015

Entered
on FLSD
Reporting
Company
35
THE COURT:
MR. MONTGOMERY:
I see.
I mean, I've been going --
as I said, I was in the hospital in May and June, I
got out sometime in July, but I've been in rehab for
nine, ten months.
just to stay alive, Your Honor.
7
8
It's cost me everything I have
THE COURT:
Any chance your wife can help
you in the case at all?
MR. MONTGOMERY:
Not really, Your Honor.
10
Look, what you're looking at, look at this stuff.
11
What's fair to me is to drop the $200,000 that they
12
claim I owe.
13
A perfect example, Your Honor, one of the
14
deductions is my moving expense.
15
Nevada, and after this whole search warrant and
16
everything, I moved my entire family to Washington.
17
Well, the moving company which moved me was $65,000,
18
so here they're disallowing my moving expense when
19
I'm moving from California to Washington where I got
20
a new job.
21
So I lived in Reno,
It's crazy, Your Honor.

THE COURT:
All right.
Well, this is an
22
unusual case; I think we can all agree on that.
23
said, I've got to make my way through this very large
24
binder of documents and then figure out where to go.
25
If you want to tell me where you think I should go
(866) 448 - DEPO
As I
DLM-023510
2015

Entered
on FLSD
Reporting
Company
36
with this, tell me by the time I'm back from Buffalo.
That would be April 20.
I have two more weeks of trial sessions in
different parts of the country between now and April
20, and then I have a pause.
thoughts that you want to commit to writing, give
them to me by April 20.
8
9
So if you have any
In the meantime, I will go through this

binder and try to figure some things out and a
10
direction in which we can take this.
11
won't just pass it on to the next judge; I want to
12
get this -- there may be an answer in here somewhere
13
is what I'm thinking.
14
MR. MONTGOMERY:
As I said, I
The answer is simple:
15
allow me my deductions and allow me my attorney fees,
16
and I can move on with my life.
17
THE COURT:
And you get a giant NOL one way
18
or the other, either a giant new deduction for '06 or
19
a giant NOL for the later years.
20
would carry back and wipe out your income and thus
21
your tax liability.
22
and you'll be right.
23
I understand that
There's a theory of the case,
MR. MONTGOMERY:
Your Honor, one of the
24
reasons that I couldn't file my 2009 and '10 taxes is
25
how do I file them when none of this stuff has been
(866) 448 - DEPO
DLM-023511
2015

Entered
on FLSD
Reporting
Company
37
resolved?
over a million five.
My legal bill in 2007, Your Honor, was
So I just want to resolve 2006, and I think
the easiest resolution, Your Honor, is simply give me
my deduction.
THE COURT:
You may be right, and who
knows, maybe Mr. Corry in the next two months will
look at it and conclude that you're right -- maybe.
MR. CORRY:
Your Honor, if I may?
10
THE COURT:
Yes.
11
MR. CORRY:
He is living in Washington now.
12
I don't know if you want to ask Petitioner if he
13
would --
14
15
16
17
18
19
20
MR. MONTGOMERY:
I don't want to change
people now, Your Honor.

MR. CORRY:
I just wanted to give him the
opportunity.
MR. MONTGOMERY:
I'd rather him stay on
this attempt to resolve things.

THE COURT:
Okay.
It is a very old case,
21
but you're right, a trial might have to have a change
22
in place of trial, were that to become necessary.
23
MR. CORRY:
And, Your Honor, maybe to move
24
forward, if Petitioner would like to go on the record
25
and describe his gambling losses, because gambling
(866) 448 - DEPO
DLM-023512
2015

Entered
on FLSD
Reporting
Company
47
CERTIFICATE OF TRANSCRIBER AND PROOFREADER
CASE NAME:
MONTGOMERY v. COMMISSIONER
DOCKET NO.:9008-09
We the undersigned, do hereby certify that the
foregoing pages, numbers 1 through
the true, accurate and complete transcript prepared
from the verbal recording made by electronic
recording by Brenda W. Thompson on February 24, 2015,
DENNIS L. MONTGOMERY & BRENDA K.
, inclusive, are
10
before the United States Tax Court at its session in
11
Los Angeles, California, in accordance with the
12
applicable provisions of the current verbatim
13
reporting contract of the Court, and have verified
14
the accuracy of the transcript by comparing the
15
typewritten transcript against the verbal recording.
16
17
_____________________________
18
Nancy H. King
03/13/2015
19
(Transcriber)
(Date)
20
21
______________________________
22
Laurel H. Stoddard
23
(Proofreader)
03/19/2015
(Date)
24
25
(866) 448 - DEPO
DLM-023522
2015
EXHIBIT 11
TRAN
DISTRICT COURT
CLARK COUNTY, NEVADA
* * * * *
.
THE STATE OF NEVADA,
.
CASE NO. C-268764
.
Plaintiff,
.
DEPT. NO. X
.
vs.
.
TRANSCRIPT OF
.
PROCEEDINGS
DENNIS L. MONTGOMERY,
.
.
Defendant.
.
. . . . . . . . . . . . . . .
BEFORE THE HONORABLE JUDGE WALSH, DISTRICT COURT JUDGE
STATUS CHECK
WEDNESDAY, MAY 13, 2015
APPEARANCES:
FOR THE STATE:
GLEN O'BRIEN, ESQ.

Deputy District Attorney
FOR THE DEFENDANT:
KAMBIZ SHAYGAN-FATEMI, ESQ.

Deputy Public Defender
COURT RECORDER:
TRANSCRIPTION BY:
VICTORIA BOYD
District Court
VERBATIM DIGITAL REPORTING, LLC

Englewood, CO 80110
(303) 798-0890
Proceedings recorded by audio-visual recording, transcript

produced by transcription service.
2
1
LAS VEGAS, NEVADA, MONDAY, JUNE 2, 2014, 9:01 A.M.
THE COURT:
State of Nevada vs. Dennis Montgomery.
MR. O'BRIEN:
O'Brien for the State.
THE COURT:
MR. SHAYGAN:
10
Glen
Good morning.
Good morning, Your Honor.
Kambiz
Shaygan with the Public Defender's Office.
8
9
Good morning, Your Honor.
Your Honor, this is my first time before Your Honor

as a member of this team.
Truly, my pleasure.
Good morning
to your staff, as well.
11
THE COURT:
12
your last name for the record?
13
Thank you, sir.
MR. SHAYGAN:
Could you please spell
Yes, Your Honor.
14
ink.
15
Court's pleasure, I just go by Shaygan.
I hope your pen has
It's S-h-a-y-g-a-n, hyphen, F-a-t-e-m-i.
16
THE COURT:
Shaygan.
17
MR. SHAYGAN:
But for the
Thank you, Mr. Shaygan.
Thank you, Your Honor.
18
ask you to waive my client's presence.
19
O'Brien about it.
20
unable to be here.
21
asking Your Honor for a 90-day status check.
Your Honor, I
I did speak with Mr.
I showed him some medical records.

He's currently in Seattle.
22
THE COURT:
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MR. O'BRIEN:
He's
I will be
Mr. O'Brien?
It's an ongoing thing.
It looks like
24
my predecessor already laid down our concerns to the Court
25
about the continuation, but obviously, there's medical issues
Verbatim Digital Reporting, LLC 303-798-0890
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1
here, so I'll submit it to the Court.
THE COURT:
Very well.
THE CLERK:
August 12th, at 8:30.
MR. SHAYGAN:
THE COURT:
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7
Ninety days.
Thank you, Your Honor.
You're welcome.
(Proceeding concluded at 9:02 a.m.)

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Verbatim Digital Reporting, LLC 303-798-0890
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AUDI O- VI SUAL RECORDI NG OF THE PROCEEDI NGS I N THE ABOVE
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Montgomery V Risen # 94 - S.D.Fla. - 1-15-cv-20782 - 94 - D Memo of Law Re 91

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Montgomery V Risen # 94 - S.D.Fla. - 1-15-cv-20782 - 94 - D Memo of Law Re 91

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Case 1:15-cv-20782-JEM Document 94 Entered on FLSD Docket 08/04/2015 Page 1 of 7

UNITED STATES DISTRICT COURT

DEFENDANTS PRE-HEARING MEMORANDUM

HOLLAND & KNIGHT LLP

DAVIS WRIGHT TREMAINE LLP

Counsel for Defendants

Case 1:15-cv-20782-JEM Document 94 Entered on FLSD Docket 08/04/2015 Page 2 of 7

Case 1:15-cv-20782-JEM Document 94 Entered on FLSD Docket 08/04/2015 Page 3 of 7

how the request is unreasonable or not relevant.).

Case 1:15-cv-20782-JEM Document 94 Entered on FLSD Docket 08/04/2015 Page 4 of 7

Case 1:15-cv-20782-JEM Document 94 Entered on FLSD Docket 08/04/2015 Page 5 of 7

2. The Court Should Compel Production of Material Relevant to Plaintiffs Domicile

Case 1:15-cv-20782-JEM Document 94 Entered on FLSD Docket 08/04/2015 Page 6 of 7

3. The Court Should Compel Production of Relevant Unproduced Medical Records

Fla. 1997) (location of the persons doctors is domicile factor).

Case 1:15-cv-20782-JEM Document 94 Entered on FLSD Docket 08/04/2015 Page 7 of 7

Certificate of Good-Faith Conference;

Dated: August 4, 2015

Case 1:15-cv-20782-JEM Document 94-1 Entered on FLSD Docket 08/04/2015 Page 1 of 3

Case 1:15-cv-20782-JEM Document 94-1 Entered on FLSD Docket 08/04/2015 Page 2 of 3

Case 1:15-cv-20782-JEM Document 94-1 Entered on FLSD Docket 08/04/2015 Page 3 of 3

Case 1:15-cv-20782-JEM Document 94-2 Entered on FLSD Docket 08/04/2015 Page 1 of 6

UNITED STATES DISTRICT COURT

DENNIS MONTGOMERY, et al.,

UNITED STATES ______________

IT IS HEREBY ORDERED as follows:

existence or non-existence of any actual or proposed relationship, agreement, connection,

software or source code owned or claimed by the Parties.

The computer source code, software, programs, or technical specifications

Any contract, relationship, agreement, connection, transaction, communication

Any actual or potential commercial or government applications of the

Technology, unless covered by paragraphs 2 or 3 above;

the Technology, unless covered by paragraphs 2 or 3 above;

disclosure of such information would be covered by paragraphs 2 or 3 above; and

Any consideration received by any of the Parties relating to the Technology,

unless covered by paragraphs 2 or 3 above.

at trial, in any pleading or motion, or in any case-related correspondence, any actual or

proposed relationship, agreement, connection, contract, transaction, communication or

at trial, in any pleading or motion, or in any case-related correspondence, any actual or

No question and no document request in discovery or at trial shall require a

(hereinafter collectively referred to as the documents), unless such documents request or

relate to information covered by paragraphs 2 or 3 above. If the documents request or

document, including exhibits, correspondence, or anything appended thereto or filed

August 29, 2007

Case 1:15-cv-20782-JEM Document 94-3 Entered on FLSD Docket 08/04/2015 Page 1 of 19

UNITED STATES DISTRICT COURT

DENNIS MONTGOMERY, et al.,

Mr. Trepp contributed his business expertise, and Mr.

The Contribution Agreement

The Operating Agreement

pursuant to the contribution agreement.

Montgomery left eTreppid and never returned. Tr. at 46:23-24; 47:1-18.

The Parties Claims and Counterclaims

The Montgomery parties amended complaint (#7)

Copyright infringement - unlawful distribution of copyrighted work injunction

exploitation of the copyrights and derivative works.2 Id. at 36-39.

Breach of fiduciary duty

Misappropriation of trade secrets

Declaratory relief against the United States

relevant to this discovery dispute:

[I]n order to defend Trepps and eTreppids claims of trade secret

[T]hese disclosures go to the very core of Defendants expected

Montgomery ... must make such disclosures in order to establish