Redhawk Holdings Corp., et al v. Schreiber, et alMOTION to Dismiss Case Pursuant to 28 U.S.C. Sect. 1406E.D. La.May 19, 2017UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA REDHAWK HOLDINGS CORP. AND * CIVIL ACTION NO. 17-819(B)(3) BEACHWOOD PROPERTIES, LLC * * JUDGE LEMELLE VS. * * MAGISTRATE JUDGE KNOWLES DANIEL J. SCHREIBER AND * SCHREIBER LIVING TRUST * – DTD 2/08/95 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * RULE 12(b)(3) MOTION TO DISMISS PURSUANT TO 28 U.S.C. § 1406(a) OR, IN THE ALTERNATIVE, TRANSFER (28 U.S.C. §§ 1406(a), 1404(a)) NOW INTO COURT, through undersigned counsel, come Defendants, Daniel J. Schreiber and Daniel J. Schreiber, Trustee of the Schreiber Living Trust—DTD 2/08/95 (collectively, “Defendants”), who respectfully move this Honorable Court to dismiss this action pursuant to 28 U.S.C. § 1406(a) or, in the alternative, transfer venue to the Southern District of California pursuant to either § 1406(a) or § 1404(a). As explained more fully in the accompanying memorandum in support, the Eastern District of Louisiana is not a proper venue for this action, as the only substantial events or omissions that gave rise to Plaintiffs’ claims occurred, if anywhere, in San Diego, California. Alternatively, should this Court find that the Eastern District of Louisiana is a proper venue, this case should nonetheless be transferred to the Southern District of California for the convenience of the parties and witnesses, and in the interest of justice under 28 U.S.C. § 1404(a). WHEREFORE, Defendants respectfully request that this Honorable Court grant their motion, and either dismiss this action or transfer it to the Southern District of California. Case 2:17-cv-00819-ILRL-DEK Document 26 Filed 05/19/17 Page 1 of 2 -2- Respectfully submitted, /s/ Matt Jones Paul Matthew Jones, T.A. (#19641) LISKOW & LEWIS 822 Harding Street P.O. Box 52008 Lafayette, Louisiana 70505-2008 Telephone (337) 232-7424 Facsimile (337) 267-2399 Dana M. Douglas (Bar #26866) Kathryn Z. Gonski (Bar #33442) LISKOW & LEWIS 701 Poydras Street, Suite 5000 New Orleans, Louisiana 70139-5099 Telephone: (504) 581-7979 Facsimile: (504) 556-4108 Attorneys for Daniel J. Schreiber and Daniel J. Schreiber, Trustee of the Schreiber Living Trust—DTD 2/08/95 CERTIFICATE OF SERVICE I HEREBY CERTIFY that a copy of the above and foregoing pleading was served upon all counsel of record by electronic mail on the 19th of May, 2017, and by the Clerk of Court via the CM/ECF system this 22nd of May, 2017. /s/ Matt Jones Case 2:17-cv-00819-ILRL-DEK Document 26 Filed 05/19/17 Page 2 of 2 -0- UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA REDHAWK HOLDINGS CORP. AND * CIVIL ACTION NO. 17-819(B)(3) BEECHWOOD PROPERTIES, LLC * * JUDGE LEMELLE VS. * * MAGISTRATE JUDGE KNOWLES DANIEL J. SCHREIBER AND * SCHREIBER LIVING TRUST * – DTD 2/08/95 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * MEMORANDUM IN SUPPORT OF RULE 12(b)(3) MOTION TO DISMISS PURSUANT TO 28 U.S.C. § 1406(a) OR, IN THE ALTERNATIVE, TRANSFER (28 U.S.C. § § 1406(a), 1404(a)) Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 1 of 24 -i- TABLE OF CONTENTS I. INTRODUCTION ...............................................................................................................1 II. BRIEF STATEMENT OF FACTS......................................................................................3 III. ARGUMENT.......................................................................................................................7 A. 28 U.S.C. § 1406(a) - Mandatory Transfer ..............................................................8 1. Defendants’ 12(b)(3) Motion is Timely...................................................................8 2. Plaintiffs Have the Burden of Establishing Venue ..................................................8 3. Plaintiffs’ Cannot Establish Venue Under Either 15 U.S.C. § 78aa or 28 U.S.C. § 1391(b).............................................................................................8 i. 15 U.S.C. § 78aa – Venue Where Any Act or Transaction Constituting a Violation Occurred ...........................................................................9 ii. Venue in the Eastern District of Louisiana is Improper under 15 U.S.C. § 78aa Because No Act or Transaction Constituting a Violation Occurred in this District...........................................................................9 iii. 28 U.S.C. § 1391(b) – Venue Where a Substantial Part of the Events or Omissions Occurred...............................................................................11 iv. Venue in the Eastern District of Louisiana is Improper under 28 U.S.C. § 1391(b) Because No Substantial Parts of the Event or Omissions Occurred in this District.......................................................................14 B. 28 U.S.C. § 1404(a) – Transfer Venue for Convenience of the Parties and Witnesses.............................................................................................16 1. Parties’ Convenience .............................................................................................16 2. Witnesses’ Convenience ........................................................................................17 3. Interest of Justice ...................................................................................................18 IV. CONCLUSION..................................................................................................................19 Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 2 of 24 -ii- TABLE OF AUTHORITIES Cases Bigham v. Envirocare of Utah, Inc., 123 F. Supp. 2d 1046 (S.D. Tex. 2000) ................................................................................................................ 8,16,13,17 Brandon Apparel Group, Inc. v. Quitman Mfg. Co. Inc., 42 F. Supp. 2d 821(N.D. Ill. 1999);..............................................................................................................18 Commercial Lighting Products, Inc. v. United States Dist. Ct., 537 F.2d 1078 (9th Cir. 1976) .............................................................................................................12 Cottman Transmission Systems, Inc. v. Martino, 36 F.3d 291 (3d Cir. 1994). .......12 Dwyer v. General Motors Corp., 853 F. Supp. 690 (S.D. N.Y. 1994)....................17 E. & J. Gallo Winery v. F. & P. S.p.A,. 899 F. Supp. 465 (E.D. Cal. 1994)...........16 Employers Mut. Cas. Co. v. Bartile Roofs, Inc., 618 F.3d 1153 (10th Cir. 2010). .12 Filmline (Cross-Country) Productions, Inc. v. United Artists Corp., 865 F.2d 513 (2d Cir. 1989) .......................................................................................................18 First of Mich. Corp. v. Bramlet, supra, 141 F. 3d at 263 ........................................12 Gonsalves-Carvalhal v. Aurora Bank, FSB, 2014 WL 201502, *7 (E.D. N.Y. 2014 ..............................................................................................................................12 Gulf Ins. Co. v. Glasbrenner, 417 F.3d 353 (2d Cir. 2005).....................................12 Hoffman v. Blaski, 363 U.S. 335, 343 (1960).......................................................8,16 In re TS Tech USA Corp., 551 F3d 1315 (Fed. Cir. 2008) ............................... 17, 18 In re Volkswagen of America, Inc., 506 F.3d 376 (5th Cir. 2007) .........................18 Jenkins Brick Co. v. Bremer, 321 F.3d 1366 (11th Cir. 2003) ................................12 Lamont v. Haig, 590 F.2d 1124 (D.C. Cir. 1978)....................................................13 Lopez Perez v. Hufstedler, 505 F. Supp. 39 (D. D.C. 1980) ...................................16 Mateos v. Select Energy Services, L.L.C., 919 F.Supp.2d 817 (W.D. Tex. 2013). .16 Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 3 of 24 -iii- Miracle v. NYP Holdings, Inc., 87 F. Supp. 2d 1060 (D. Haw. 2000) ...................17 Myers v. Bennett Law Offices, 238 F.3d 1068 (9th Cir. 2001)................................13 Navajo Nation v. Urban Outfitters, Inc., 918 F. Supp. 2d 1245 (D. N.M. 2013)....18 Palace Exploration Co. v. Petroleum Develop. Co., 316 F3d 1110 (10th Cir. 2003) ..............................................................................................................................18 Reese v. CNH America LLC, 574 F.3d 315 (6th Cir. 2009). ...................................19 Sallyport Global Services, Ltd. v. Arkel Int'l, LLC, 78 F. Supp. 3d 369 (D. D.C. 2015).....................................................................................................................19 Seariver Mar. Fin. Holdings, Inc. v. Pena, 952 F. Supp. 455 (S.D. Tex. 1996).....13 Travel Tags, Inc. v. UV Color, Inc., 690 F. Supp. 2d 785 (D. Minn. 2010)............18 Uffner v. La Reunion Francaise, S.A., 244 F.3d 38 (1st Cir. 2001) ........................12 Van Dusen v. Barrack, 376 U.S. 616 (1964) ...........................................................19 Woodke v. Dahm, 70 F.3d 983 (8th Cir.1995).................................................. 13, 16 Statutes 15 U.S.C. § 78aa ..................................................................................... 1, 2, 8, 9, 11 28 U.S.C. § 1391............................................................................. 2, 8, 9, 11, 12, 14 28 U.S.C. § 1404.................................................................................... 1,2, 7, 16, 18 28 U.S.C. § 1406....................................................................................... 1,2, 7, 8,16 Federal Rules of Civil Procedure Rule 12 .............................................................1, 8 Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 4 of 24 -1- Defendants, Daniel J. Schreiber and Daniel J. Schreiber, Trustee of the Schreiber Living Trust—DTD 2/08/95 (collectively, “Defendants”), through undersigned counsel, hereby submit this Memorandum in Support of their Motion to Dismiss or Transfer Venue pursuant to Federal Rules of Civil Procedure Rule 12(b)(3) and 28 U.S.C. section 1406(a) or, in the alternative, Section 1404(a): I. INTRODUCTION Plaintiffs, RedHawk Holdings Corp., formerly known as Independence Energy Corp. (“RedHawk”) and Beechwood Properties, LLC (“Beechwood”) (collectively “Plaintiffs”), filed their Complaint against Defendants alleging claims of securities fraud, breach of contract, unjust enrichment, and breach of fiduciary duties.1 The lawsuit alleges that venue is proper in Louisiana because, according to Plaintiffs, an act or transaction constituting a violation of the Securities and Exchange Act of 1934, 15 U.S.C. § 78aa, occurred in the United States District Court for the Eastern District of Louisiana and because a “substantial part” of the events or omissions giving rise to the claims occurred in this district.2 Plaintiffs’ basis for concluding that a “substantial part” of the events or omissions in this matter occurred in “this district” is that Plaintiff RedHawk, a Nevada corporation, is currently headquartered in Lafayette Parish, Louisiana, and that Plaintiff Beechwood is both a Louisiana limited liability company and headquartered in Lafayette Parish.3 Notably, Lafayette Parish is located in the Western District of Louisiana and, as explained below, outside of a single alleged 1 Rec. Doc. No. 1. (the “Complaint”). See also Rec. Doc. No. 20, First Amended Complaint reiterating and realleging all claims in the original Complaint. 2 Id. at ¶ 7. 3 See id. at ¶¶ 2, 3, 7. Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 5 of 24 -2- meeting in New Orleans, none of the events or omissions in this matter occurred in the Eastern District of Louisiana, as Plaintiffs claim. Defendants are located in San Diego, California, and have no ties to the state of Louisiana outside of their contacts with Plaintiffs.4 As the Complaint acknowledges, Mr. Schreiber “generally acted from San Diego County, California,” even while he was CEO and a director for RedHawk.5 Because there is no formal written agreement between the parties and there is no forum selection clause, the only events or omissions that are relevant to the Complaint are the actions of Defendants.6 As a result, all of the alleged conduct that Plaintiffs argue “give rise” to the claims raised in the Complaint against Defendants—i.e., Defendants’ alleged omissions and actions—occurred in San Diego. Pursuant to 28 U.S.C. § 1406, a court must dismiss or transfer a matter if venue is not proper. Due to Plaintiffs’ reliance on 15 U.S.C. § 78aa and 28 U.S.C. § 1391(b), the two questions for the court are whether (1) any act or transaction constituting the violation occurred in the Eastern District of Louisiana or (2) whether a substantial part of the events or omissions giving rise to the claims occurred in this district. Both questions must be answered in the negative. Thus, the Court must either dismiss this action or transfer venue to the United States District Court for the Southern District of California. In the alternative, should the Court not find venue to be improper under Section 1406, venue should nonetheless be transferred California for the convenience of the parties under 28 U.S.C. § 1404. Not only are Plaintiffs corporate entities that are in a better position to fund a 4 Declaration of Daniel J. Schreiber (“Schreiber Decl.”) at ¶ 2. 5 Complaint at ¶ 37. 6 See generally, id. Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 6 of 24 -3- lawsuit in a foreign venue, but recent conduct by RedHawk has given rise to a separate lawsuit filed by Defendants in the Southern District of California, Case No. 17-cv-0824WQH-BLM.7 Should the present action be transferred, the matters could be consolidated. II. BRIEF STATEMENT OF FACTS The essence of Plaintiffs’ factual claims against Defendants is that Mr. Schreiber allegedly did not disclose certain information during his tenure as a director and CEO of RedHawk, and particularly at the time RedHawk entered into an asset purchase agreement (the “APA”) with American Medical Distributors, LLC (“AMD”) on March 31, 2014.8 RedHawk’s claims for securities fraud, state fraud, and breach of fiduciary duty generally break down into four categories, which include: (a) Defendants’ alleged nondisclosure, and continued nondisclosure, of an infringement claim that affected the APA; (b) Defendants’ alleged misrepresentation that they would fund a 50% share of RedHawk’s expenses; (c) Defendants’ alleged misrepresentations that they would contribute certain assets to RedHawk; and (d) Defendants’ alleged misrepresentations, omissions and concealments concerning alleged Financial Industry Regulatory Authority (FINRA) issues.9 Beechwood’s claims for breach of contract and unjust enrichment are premised on the same RedHawk allegations that Mr. Schreiber orally agreed to pay for a 50% share of RedHawk’s expenses and to contribute various assets, and that Mr. Schreiber breached those terms.10 Notably absent from the Complaint are any allegations of a written contract between Plaintiffs and Defendants, and no forum selection clause is identified.11 Also notable is the fact 7 Schreiber Decl. at ¶ 12. 8 See, e.g. Complaint at ¶¶ 8, 28-30. 9 Id. at ¶ 69. 10 Id. at ¶ 89. 11 See id., generally. Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 7 of 24 -4- that the “representations” that RedHawk allegedly relied upon as the basis for its claims regarding the infringement claim were made by AMD in the APA—not by Mr. Schreiber or his Trust.12 Nonetheless, Mr. Schreiber denies all claims in the Complaint, as he made all necessary disclosures regarding the infringement claim and FINRA issues to Redhawk and did not breach any alleged oral agreement to fund expenses or contribute assets to RedHawk.13 Notwithstanding the inaccuracies of Plaintiffs’ allegations, Plaintiffs do not dispute that Mr. Schreiber was based in San Diego at all times relevant to the lawsuit.14 Specifically, the Complaint notes that Mr. Schreiber served as a director on RedHawk’s Board of Directors from March 31, 2014, until April 20, 2016, and that Mr. Schreiber was RedHawk’s CEO from February 27, 2015, until July 5, 2016.15 Indeed, prior to and throughout Mr. Schreiber’s tenure as CEO and as a director of RedHawk, Mr. Schreiber acted in both capacities while in San Diego.16 Mr. Schreiber was in San Diego during the negotiations for the APA.17 The nature of Mr. Schreiber’s role—including his disclosures to RedHawk and performance of any alleged agreement with Beechwood—allowed Mr. Schreiber to make those decisions while he was in California.18 The Complaint asserts that RedHawk and Beechwood do business in Lafayette Parish.19 What the Complaint omits, however, is that RedHawk was previously based in Seal Beach, 12 See id. at ¶ 11. 13 Schreiber Decl. at ¶ 5. 14 Complaint at ¶ 37. 15 Id. at ¶¶ 36, 63. 16 Schreiber Decl. at ¶ 3. 17 Id. at ¶ 4. 18 Id. at ¶ 3. 19 Complaint at ¶¶ 37, 38. Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 8 of 24 -5- California at the time Mr. Schreiber first began his business dealings with the company in 2014.20 As stated in the company’s public SEC filings, RedHawk maintained its California address until November 12, 2014, when the company relocated to St. Louis, Missouri.21 It was not until on or around February 27, 2015, that RedHawk moved to Lafayette; nearly a full year after Mr. Schreiber had first become involved with the company and negotiated the APA in March 2014.22 Outside of a single visit to New Orleans, described below, Plaintiffs never required or even requested that Mr. Schreiber visit or relocate to Lafayette Parish in his capacity as CEO of RedHawk.23 RedHawk’s board meetings, for example, occurred telephonically.24 Upon a careful reading of the Complaint, and as explained below, Plaintiffs only point to two alleged visits by Mr. Schreiber to Louisiana—one to Baton Rouge and one to New Orleans— and thus only one visit that actually relates to the Eastern District of Louisiana.25 First, Plaintiffs allege that that Defendants entered into two distinct agreements with Beechwood, one for funding 50% of RedHawk’s expenses (the “Expenses Agreement”) and another for contributing assets to RedHawk (the “Contribution Agreement”).26 Beechwood acknowledges that the parties were located in their respective areas—Mr. Schreiber in San Diego and Beechwood in Lafayette—when the alleged Expenses Agreement was negotiated and entered into over the phone.27 Thus, the crux of Plaintiffs’ claims related to the Eastern District of 20 Schreiber Decl. at ¶ 6. 21 Id. 22 Id. at ¶ 7. 23 Schreiber Decl. at ¶ 3. 24 Id. 25 Complaint at ¶¶ 41, 45, 46. 26 Id. at ¶¶ 40-45. 27 Id. at ¶ 38. Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 9 of 24 -6- Louisiana is their assertion that Mr. Schreiber “negotiated and entered into” the alleged Contribution Agreement with Beechwood in New Orleans and allegedly made “representations” about the agreement to other parties in a “series of meetings” with RedHawk investors.28 Plaintiffs do not point to any written agreements between Beechwood and Defendants to support these claims, however. Contrary to these claims, any oral agreements between Defendants and Beechwood related to expenses and contributions to RedHawk—which Defendants deny as alleged—were negotiated and entered into at the same time while Defendants were in San Diego.29 Although Mr. Schreiber visited New Orleans on or around October 26, 2015 for a presentation by an outside company to RedHawk’s Board of Directors—his only visit to New Orleans—he did not make any material representations regarding any purported agreements with Beechwood at this meeting.30 Notably, the meeting in New Orleans was also the only time the RedHawk Board of Directors met in person while Mr. Schreiber was on the board.31 More importantly, Plaintiffs do not allege that either of the purported Beechwood agreements was breached while Mr. Schreiber was in New Orleans. Instead, Beechwood only alleges that it confronted Mr. Schreiber about his “failure to perform” while in Baton Rouge and New Orleans, where Mr. Schreiber allegedly “offered assurances” and “confirmed or made new or additional agreements.”32 The Complaint fails to explain that the only reason Mr. Schreiber was in Baton Rouge was to watch his son play baseball in Hammond, Louisiana, and that his only 28 Id. at ¶ 45. 29 Schreiber Decl. at ¶ 9. 30 Id. 31 Id. 32 Complaint at ¶ 41. Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 10 of 24 -7- business-related conduct on this trip was a breakfast with Darcy Klug, RedHawk’s current CEO and the owner of Beechwood.33 Nonetheless, Baton Rouge is located in the Middle District of Louisiana and thus is not relevant to this motion. As relevant to the discussion herein, the critical witnesses implicated by the Complaint (other than the parties) are Paul A. Rachmuth, the owner of AMD who is based out of New York,34 and Howard Taylor, a former CEO and Chairman of the Board for RedHawk, who lived between St. Louis, Bermuda, and London, England at all times relevant to the Complaint.35 Both Mr. Rachmuth and Mr. Taylor were given shares of RedHawk in exchange for the APA.36 As alleged in the Complaint, Mr. Rachmuth also served as counsel to AMD and Beechwood.37 Mr. Taylor served as RedHawk’s CEO from March 31, 2014, until February 27, 2015, and was on the company’s board of directors during this time.38 Their testimony is thus pertinent to the allegations in the Complaint, and neither are located in the Eastern District of Louisiana. III. ARGUMENT There are generally two methods to transfer venue: a mandatory dismissal or transfer under 28 U.S.C. § 1406 or a transfer for the convenience of the parties under 28 U.S.C. § 1404. Defendants seek either a dismissal under Section 1406, or a transfer of venue under either statute to the Southern District of California. 33 Schreiber Decl. at ¶ 8. 34 Id. at ¶ 10. 35 Id. at ¶ 11. 36 Complaint at ¶ 15. 37 Id. at ¶ 17. 38 Schreiber Decl. at ¶ 11. Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 11 of 24 -8- A. 28 U.S.C. § 1406(a) - Mandatory Transfer 1. Defendants’ 12(b)(3) Motion is Timely Under 28 U.S.C. § 1406(a), if the forum venue is improper a court must dismiss or transfer venue. A motion to challenge venue as improper is usually brought in a Federal Rules of Civil Procedure 12(b) motion, and a venue challenge under Section 1406 is waived if the objection is not timely brought in the defendant’s initial responsive pleading or in a preanswer motion under Rule 12.39 Here, Defendants were served with Plaintiffs’ First Amended Complaint on April 28, 2017.40 This 12(b)(3) motion for dismissal or transfer under Section 1406 is therefore timely. 2. Plaintiffs Have the Burden of Establishing Venue Once a defendant raises the issue of proper venue by motion, the burden of proof is placed upon the plaintiff to sustain venue.41 Here, because Defendants object to venue, the burden shifts to the Plaintiffs to sustain venue in the Eastern District of Louisiana. 3. Plaintiffs’ Cannot Establish Venue Under Either 15 U.S.C. § 78aa or 28 U.S.C. § 1391(b) Plaintiffs rely upon 15 U.S.C. § 78aa and 28 U.S.C. § 1391(b) to argue that venue in the Eastern District of Louisiana proper, though neither is supported by Plaintiffs’ allegations. 39 See Hoffman v. Blaski, 363 U.S. 335, 343 (1960). 40 Plaintiffs initially filed a motion for entry of default in this matter on March 15, 2017. When Defendants became aware of the motion they notified Plaintiffs that Plaintiffs’ attempts at mail service were sent to the wrong address. After Defendants filed a contested motion to set aside the default, Plaintiffs filed an Amended Complaint and Defendants agreed to accept service through its counsel in Louisiana. Defendants subsequently filed an unopposed motion to set aside the default, which remains pending (Rec. Doc. Nos. 6, 13, 24). 41 Bigham v. Envirocare of Utah, Inc., 123 F. Supp. 2d 1046, 1047–48 (S.D. Tex. 2000). Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 12 of 24 -9- i. 15 U.S.C. § 78aa – Venue Where Any Act or Transaction Constituting a Violation Occurred 15 U.S.C. § 78aa generally provides for jurisdiction of a case arising under the Securities and Exchange Act of 1934 (the “Act”) in the district courts of the United States. Although the statute does not explicitly mention “venue,” the statute addresses where venue of such actions may be proper in both criminal and civil actions: Any criminal proceeding may be brought in the district wherein any act or transaction constituting the violation occurred. Any suit or action to enforce any liability or duty created by this chapter or rules and regulations thereunder, or to enjoin any violation of such chapter or rules and regulations, may be brought in any such district or in the district wherein the defendant is found or is an inhabitant or transacts business. Thus, the statute creates venue for Act violations in one of two districts: (1) where any act or transaction constituting the violation occurred and (2) wherein the defendant is found or is an inhabitant or transacts business. Because Plaintiffs concede that Defendants reside and transact business almost exclusively in San Diego, Plaintiffs rely exclusively on their argument that an act or transaction constituting the violation occurred in the Eastern District of Louisiana. ii. Venue in the Eastern District of Louisiana is Improper under 15 U.S.C. § 78aa Because No Act or Transaction Constituting a Violation Occurred in this District Plaintiffs cannot meet their burden of establishing venue under 15 U.S.C. § 78aa. Although Plaintiffs do not explicitly distinguish between what actions they rely upon under 15 U.S.C. § 78aa and which acts they rely upon under 28 U.S.C. § 1391(b), it is easy to dismiss Plaintiffs’ 15 U.S.C. § 78aa claims as they only cite one actual “act” or “transaction” that occurred in the Eastern District of Louisiana. Specifically, Plaintiffs only point to a single, undated visit to New Orleans in the Complaint, as Baton Rouge is located in the Middle District and Plaintiffs operate their businesses in the Western District of Louisiana. Moreover, in the alleged “meetings” in New Orleans, the Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 13 of 24 -10- focus of Plaintiffs’ allegations is that the Defendants entered into an oral Contributions Agreement with Beechwood and made representations about that agreement to outside parties.42 Plaintiffs do not specifically allege that Defendants made any misrepresentations or omissions related to the infringement claim, the Expense Agreement, or the FINRA issues—which represent the foundation of Plaintiffs’ Act claims. Nor do Plaintiffs allege that Defendants signed or executed any SEC filings during this visit in New Orleans, which is the basis of Plaintiffs’ second claim for securities fraud. This severely narrows the scope of Plaintiffs’ claims under the Act that can be traced to the New Orleans meeting. In any event, Plaintiffs’ attempt to assign Beechwood’s reliance upon misrepresentations and omissions that allegedly occurred in New Orleans simply does not make sense because Beechwood had already invested in RedHawk by the time the New Orleans meeting occurred. Plaintiffs’ Complaint makes clear that Beechwood received its shares in RedHawk following the transaction that occurred in March 2014,43 which occurred while Defendants were in San Diego.44 The meeting in New Orleans occurred on or around October 26, 201545—more than a year and a half after Beechwood’s investment. To the extent Plaintiffs claim that the Defendants breached any terms with Beechwood regarding expenses or contributions, such claims do not fall within the orbit of the Act claims which rely on misrepresentations and omissions. To the extent Plaintiffs appear to allege that other investors relied on these misrepresentations and omissions, Plaintiffs do not have standing to assert such claims. 42 Complaint at ¶ 45. 43 Id. at ¶¶ 12-16. 44 Schreiber Decl. at ¶ 4. 45 Id. at ¶ 9. Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 14 of 24 -11- Beyond the alleged Contributions Agreement, the alleged nondisclosures and representations regarding the infringement claim and the alleged FINRA issues would have first occurred—if at all—on or around March 31, 2014, when Defendants were in San Diego, and would have continued while Defendants remained in San Diego. Regarding Defendants’ alleged agreement to pay for 50% of RedHawk’s expenses, Plaintiffs do not dispute that the purported Expenses Agreement with Beechwood was entered into and allegedly breached by Defendants while in San Diego. Accordingly, Plaintiffs do not point to a single act or transaction in the Eastern District of Louisiana that would violate the Act, and thus venue is not proper in this District under 15 U.S.C. § 78aa. The only venue proper under 15 U.S.C. § 78aa is where Defendants’ reside, in the Southern District of California. iii. 28 U.S.C. § 1391(b) – Venue Where a Substantial Part of the Events or Omissions Occurred Generally, venue is established in a federal action in one of three ways under 28 U.S.C. § 1391(b): (1) a judicial district in which any defendant resides, if all defendants are residents of the State in which the district is located; (2) a judicial district in which a substantial part of the events or omissions giving rise to the claim occurred, or a substantial part of property that is the subject of the action is situated; or (3) if there is no district in which an action may otherwise be brought as provided in this section, any judicial district in which any defendant is subject to the court's personal jurisdiction with respect to such action. Plaintiffs rely on subsection (b)(2) and their assertion that a “substantial part of the events or omissions giving rise to the claim occurred” in the Eastern District of Louisiana.46 46 Complaint at ¶ 7. Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 15 of 24 -12- In determining whether venue is proper under Section 1391(b)(2), “only those acts and omissions that have a close nexus to the wrong” are relevant.47 In identifying the district or districts where “a substantial part of the events or omissions” took place, courts will first examine the nature of plaintiff's claims and the acts or omissions underlying those claims.48 Courts will then determine whether substantial events material to those claims occurred in the forum district.49 As with venue questions generally, what constitutes a “substantial part” of the “events or omissions” involved is a question of federal law (even if state law is relevant to some other portion of the lawsuit).50 The “substantiality” requirement is “intended to preserve the element of fairness so that a defendant is not haled into a remote district having no real relationship to the dispute.”51 Most courts look “not to a single ‘triggering event’ prompting the action, but to the entire sequence of events underlying the claim.”52 What constitutes a “substantial part” is likely to be determined in light of the purpose of the venue statute: “(T)he substantiality of the operative events is determined by assessment of their ramifications for efficient conduct of the suit ….”53 47 Jenkins Brick Co. v. Bremer, 321 F.3d 1366, 1372 (11th Cir. 2003) (in suit to enforce employee's covenant not to compete, court should look to the place the contract was negotiated and executed, and place of performance and breach (sales meetings, training and seminars elsewhere did not have a close nexus to the claim)); Gulf Ins. Co. v. Glasbrenner, 417 F.3d 353, 356 (2d Cir. 2005). 48 Employers Mut. Cas. Co. v. Bartile Roofs, Inc., 618 F.3d 1153, 1166 (10th Cir. 2010). 49 Id. 50 See Commercial Lighting Products, Inc. v. United States Dist. Ct., 537 F.2d 1078, 1079 (9th Cir. 1976) (dealing with former venue statute). 51 Cottman Transmission Systems, Inc. v. Martino, 36 F.3d 291, 294 (3d Cir. 1994); see Gonsalves- Carvalhal v. Aurora Bank, FSB, 2014 WL 201502, *7 (E.D. N.Y. 2014) (challenge to mortgage loan in Georgia not substantially connected to New York simply because plaintiff now lived there). 52 Uffner v. La Reunion Francaise, S.A., 244 F.3d 38, 42 (1st Cir. 2001); First of Mich. Corp. v. Bramlet, supra, 141 F. 3d at 263. 53 Lamont v. Haig, 590 F.2d 1124, 1134 (D.C. Cir. 1978); Myers v. Bennett Law Offices, 238 F.3d 1068, 1076 (9th Cir. 2001). Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 16 of 24 -13- In determining whether or not venue is proper, the court will also look to the defendant's conduct, and where that conduct took place.54 Actions taken by a plaintiff do not support venue.55 Moreover, the fact that a plaintiff residing in a given judicial district feels the effects of a defendant's conduct in that district does not mean that the events or omissions occurred in that district.56 In Seariver Mar. Fin. Holdings, Inc. v. Pena, 952 F. Supp. 455, 460–61 (S.D. Tex. 1996), a Houston company filed a lawsuit against the United States government over a federal statute that implicated the operations of a ship owned by the company.57 Although the plaintiff company argued that venue was proper in Texas due to the company’s operations, ownership, and potential losses all being based in Texas, the court held that these facts did not make venue proper.58 Citing an Eighth Circuit case, the Seariver court noted that “Congress meant to require courts to focus on relevant activities of the defendant, not of the plaintiff.”59 Likewise, the location of any alleged injuries to the plaintiff, though related, are not considered relevant to the venue analysis.60 54 Bigham v. Envirocare of Utah, Inc., 123 F. Supp. 2d 1046, 1048 (S.D. Tex. 2000) (citing Woodke v. Dahm, 70 F.3d 983, 985–86 (8th Cir.1995)). 55 Id. (Emphasis added) (citing Woodke v. Dahm, 70 F.3d 983, 985 (8th Cir.1995) (holding that the venue statute requires courts to focus not on the plaintiff's conduct but on the defendant's)). 56 Id. (citing Woodke v. Dahm, 70 F.3d 983, 985 (8th Cir.1995) (rejecting the plaintiff's argument that the district where the effects are felt is valid venue)). 57 Seariver Mar. Fin. Holdings, Inc. v. Pena, 952 F. Supp. 455, 456 (S.D. Tex. 1996) (citing Woodke v. Dahm, 70 F.3d 983, 985 (8th Cir.1995)). 58 Id. at 457. 59 Id. at 460–61 (emphasis added) (citing Woodke v. Dahm, 70 F.3d 983, 985 (8th Cir.1995)). 60 Id. (“venue for a ‘passing off’ claim under Lanham Act lies where the alleged ‘passing off’ occurred, but does not lie in the district that is the ‘location of the ultimate effect of the passing off,’ nor does it lie in district in which trailers, which were ‘passed off,’ were manufactured.”). Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 17 of 24 -14- iv. Venue in the Eastern District of Louisiana is Improper under 28 U.S.C. § 1391(b) Because No Substantial Parts of the Event or Omissions Occurred in this District As noted above, the only substantial events or omissions that gave rise to the lawsuit occurred, if anywhere, in San Diego. Defendants operated in San Diego throughout the duration of the acts and omissions alleged in the Complaint. More importantly, the specific acts and omissions alleged—as pleaded in the Complaint—are the acts of Defendants alone, not any other party. Plaintiffs’ attempts to tie Defendants’ actions to Baton Rouge and New Orleans are unpersuasive. Again, Plaintiffs only point to a single visit to New Orleans to establish venue in the Eastern District of Louisiana, and Defendants’ visit to New Orleans is wholly unrelated to any of the four general issues raised in the Complaint. Indeed, the alleged nondisclosures and representations regarding the infringement claim and the alleged FINRA issues occurred—if at all—on or around March 31, 2014, when Defendants were in San Diego, and would have continued while Defendants remained in San Diego. Plaintiffs also do not dispute that the purported Expenses Agreement with Beechwood was entered into and allegedly breached by Defendants while in San Diego. Instead, Plaintiffs only allege that Defendants entered into an oral Contributions Agreement with Beechwood and made representations regarding this Agreement to outside parties while in New Orleans. As explained above, however, any oral agreements between Defendants and Beechwood related to expenses and contributions to RedHawk—which Defendants deny as alleged—were negotiated and entered into while Defendants were in San Diego. Nor did Defendants make any material representations regarding any purported agreements with Beechwood at the meeting in New Orleans, as Mr. Schreiber was in New Orleans to attend a meeting with a third party wholly unrelated to the claims raised in the Complaint. Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 18 of 24 -15- Critically, Plaintiffs do not allege that either of the purported Beechwood agreements was breached while Mr. Schreiber was in New Orleans. Although Plaintiffs seek to characterize Mr. Schreiber’s actions in New Orleans as possibly doubling down or continuing a breach, a careful reading of Plaintiffs’ allegations makes clear that Plaintiffs do not cite any new conduct in these instances that gave rise to the lawsuit. Instead, Plaintiffs allege only that Beechwood confronted Mr. Schreiber about his “failure to perform” while in Baton Rouge and New Orleans, where Mr. Schreiber allegedly “offered assurances” and “confirmed or made new or additional agreements.” Thus, none of the alleged acts or omissions—i.e., the purported misrepresentations, omissions, and breaches—occurred in the Eastern District of Louisiana. The totality of Plaintiffs’ claims focus on events or omissions that occurred when Defendants first began transacting with Plaintiffs and continued while Mr. Schreiber was CEO and a director of RedHawk. Yet, Plaintiffs do not dispute that Mr. Schreiber acted in these capacities almost exclusively while in San Diego. Plaintiffs’ location in Lafayette Parish, Louisiana, is irrelevant because Lafayette Parish is not located in the Eastern District of Louisiana. This means that no parties have ties to the Eastern District. Yet, even if Plaintiffs could tie their conduct to the Eastern District, such contacts are insufficient to sustain venue because courts only look to the actions of defendants when conducting their venue analysis under Section 1406.61 As noted in the Bigham case, any alleged damages Plaintiffs felt in Louisiana—if any—do not mean the substantial events or omissions took place in this district. Accordingly, Plaintiffs cannot meet their burden of sustaining venue in the Eastern District of Louisiana and the case should either be dismissed or transferred to the Southern District of California pursuant to Section 1406. 61 Id. at 1048 (citing Woodke v. Dahm, 70 F.3d 983, 985–86 (8th Cir.1995)). Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 19 of 24 -16- B. 28 U.S.C. § 1404(a) – Transfer Venue for Convenience of the Parties and Witnesses Under 28 U.S.C. § 1404(a), a court may transfer an action for the convenience of parties and witnesses in the interest of justice. In order to transfer venue for the convenience of the parties and witnesses, it must be shown that to the transferee court is a district where the action “might have been brought.” As with a transfer under Section 1406, this means that the action could have been commenced originally in the transferee court—i.e., the court would have had subject matter jurisdiction, Defendants would have been subject to personal jurisdiction, and venue would have been proper.62 For the reasons stated above, there is no question that venue would be proper in the Southern District of California. Section 1404(a) cites three factors a court considers in transferring venue: (1) convenience of parties, (2) convenience of witnesses, and (3) the interest of justice.63 These factors are addressed to the inherent discretion of the court.64 They are interpreted broadly to allow the court to consider the particular facts of each case.65 Section 1404(a) rulings usually turn on the court's evaluation of the practical considerations discussed below. 1. Parties’ Convenience The relative means of the parties factor into the decision.66 Where one party is a private individual and the other is a large corporation, the corporation’s assertions regarding monetary expense and difficulty in litigating in a distant forum are likely to be disregarded.67 Although a 62 28 USC § 1404(a); Hoffman v. Blaski, 363 U.S. 335, 343-344 (1980); Mateos v. Select Energy Services, L.L.C., 919 F.Supp.2d 817, 820 (W.D. Tex. 2013). 63 28 USC § 1404(a). 64 Lopez Perez v. Hufstedler, 505 F. Supp. 39, 41 (D. D.C. 1980); E. & J. Gallo Winery v. F. & P. S.p.A,. 899 F. Supp. 465, 466 (E.D. Cal. 1994) (citing text). 65 Id. 66 Dwyer v. General Motors Corp., 853 F. Supp. 690, 693 (S.D. N.Y. 1994). 67 Miracle v. NYP Holdings, Inc., 87 F. Supp. 2d 1060, 1073 (D. Haw. 2000). Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 20 of 24 -17- plaintiff's choice of forum is given some weight, plaintiffs’ choice should not be given “inordinate” weight.68 Mr. Schreiber is an individual who will incur substantial fees and costs by having to defend the case in Louisiana, whereas the Plaintiffs are both large entities with substantial means. Mr. Schreiber is also a critical witness in the case and, as explained herein, is the most important witness regarding the alleged acts and omissions. On the other hand, Plaintiffs have selected a venue outside of their home venue, which would be the Western District of Louisiana. On balance, between the Eastern District of Louisiana in which no parties have a relationship and the Southern District of California, where Defendants reside, there is no question as to which venue is proper. 2. Witnesses’ Convenience Convenience of the witnesses is often among the most important factors.69 The court will want to know who the witnesses are, where they are located, what their testimony will be and why such testimony is relevant or necessary.70 The court will consider not only the number of witnesses located in the respective districts, but also the nature and quality of their testimony in relation to the issues in the case.71 According to some cases, “(w)hen the distance between an existing venue for trial of a matter and a proposed venue under § 1404(a) is more than 100 miles, the factor of 68 In re TS Tech USA Corp., 551 F3d 1315, 1320 (Fed. Cir. 2008) (error to give plaintiff's choice of forum “inordinate” weight). 69 Bigham v. Envirocare of Utah, Inc., supra, at 1050. 70 Filmline (Cross-Country) Productions, Inc. v. United Artists Corp., 865 F.2d 513, 520 (2d Cir. 1989); see Palace Exploration Co. v. Petroleum Develop. Co., 316 F3d 1110, 1121-1122 (10th Cir. 2003); Navajo Nation v. Urban Outfitters, Inc., 918 F. Supp. 2d 1245, 1256 (D. N.M. 2013). 71 Brandon Apparel Group, Inc. v. Quitman Mfg. Co. Inc., 42 F. Supp. 2d 821, 834 (N.D. Ill. 1999); Travel Tags, Inc. v. UV Color, Inc., 690 F. Supp. 2d 785, 793 (D. Minn. 2010) (although location of nonparty witnesses plays a critical role in this determination, the sheer number of witnesses is not decisive). Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 21 of 24 -18- inconvenience to witnesses increases in direct relationship to the additional distance to be traveled.”72 Notwithstanding the location of the parties as witnesses, the only other potential witnesses implicated in the Complaint are Paul A. Rachmuth and Howard Taylor, owners of AMD, with Mr. Rachmuth also operating as legal counsel for AMD and Beechwood and Mr. Taylor serving as RedHawk’s CEO and a director on the company’s board. Both Mr. Rachmuth and Mr. Taylor will provide testimony relevant to the allegations in Plaintiffs’ Complaint, as they were involved in the negotiations and thus were aware what disclosures were made and as to what the parties agreed. Mr. Rachmuth is based out of New York, and Mr. Taylor is currently located in England.73 Thus, the location of Mr. Taylor and Mr. Rachmuth does not tip the scale one way or the other between the Eastern District of Louisiana and the Southern District of California. 3. Interest of Justice Familiarity with governing state law in diversity cases is another important factor.74 A court will also consider whether transfer will avoid duplicative litigation, effect judicial economy and prevent waste of time and money.75 Because RedHawk’s allegations center around alleged securities fraud under federal law and only tangentially raise a state law fraud claim under Louisiana state law, its claims can just as easily be adjudicated in a federal court in California without prejudice to Plaintiffs. Beechwood’s 72 In re Volkswagen of America, Inc., 506 F.3d 376, 386 (5th Cir. 2007) (emphasis added; internal quotes omitted); see also In re TS Tech USA Corp., supra, 551 F.3d at 1320. 73 Schreiber Decl. at ¶ 11. 74 Van Dusen v. Barrack, 376 U.S. 616, 645 (1964); see Sallyport Global Services, Ltd. v. Arkel Int'l, LLC, 78 F. Supp. 3d 369, 375-376 (D. D.C. 2015) (where other factors are neutral or do not weigh strongly in favor of selected forum, transferee forum's familiarity with governing law “tips the scale”). 75 Van Dusen v. Barrack, supra, at 616; Reese v. CNH America LLC, 574 F.3d 315 (6th Cir. 2009). Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 22 of 24 -19- breach of contract cause of action and unjust enrichment remedy are likewise both actionable under California law and/or can be adjudicated by the Southern District of California. Finally, Defendants have filed a separate lawsuit in the Southern District of California, Case No. 17-cv-0824WQH-BLM.76 Defendants’ lawsuit against RedHawk is based upon RedHawk’s refusal to issue a transfer of Defendants’ shares, as required under the Uniform Commercial Code and related state law.77 RedHawk’s actions can be considered retaliatory for the perceived wrongs alleged in the present Complaint, and thus the matters can be consolidated for all purposes. In the interest of justice, should the present action be transferred, the matters could be consolidated. IV. CONCLUSION For the reasons stated herein, the Court should dismiss this action pursuant to Section 1406(a) or, in the alternative, transfer venue pursuant to either Section 1406(a) or Section 1404(a). 76 Schreiber Decl. at ¶ 12. 77 Id. Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 23 of 24 -20- Respectfully submitted, /s/ Matt Jones Paul Matthew Jones, T.A. (#19641) LISKOW & LEWIS 822 Harding Street P.O. Box 52008 Lafayette, Louisiana 70505-2008 Telephone (337) 232-7424 Facsimile (337) 267-2399 Dana M. Douglas (Bar #26866) Kathryn Z. Gonski (Bar #33442) LISKOW AND LEWIS 701 Poydras Street, Suite 5000 New Orleans, Louisiana 70139-5099 Telephone: (504) 581-7979 Fascimile: (504) 556-4108 Attorneys for Daniel J. Schreiber and Daniel J. Schreiber, Trustee of the Schreiber Living Trust— DTD 2/08/95 CERTIFICATE OF SERVICE I HEREBY CERTIFY that a copy of the above and foregoing pleading was served upon all counsel of record by electronic mail on the 19th of May, 2017, andby the Clerk of the Court via the CM/ECF system this 22nd day of May, 2017. /s/ Matt Jones Case 2:17-cv-00819-ILRL-DEK Document 26-1 Filed 05/19/17 Page 24 of 24 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA REDHAWK HOLDINGS CORP. AND * CIVIL ACTION NO. 17-819(B)(3) BEECHWOOD PROPERTIES, LLC * * JUDGE LEMELLE VS. * * MAGISTRATE JUDGE KNOWLES DANIEL J. SCHREIBER AND * SCHREIBER LIVING TRUST * – DTD 2/08/95 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * DECLARATION OF DANIEL J. SCHREIBER IN SUPPORT OF MOTION TO DISMISS OR TRANSFER VENUE I, DANIEL J. SCHREIBER, having been first duly sworn according to law, hereby declare, depose, state, affirm, and aver as follows: 1. I am aware of the matters set forth herein and the following facts and information of my own personal knowledge, and if called upon to testify to such matters, I could and would competently so testify. 2. I, personally and as Trustee of the Schreiber Living Trust, have lived San Diego, California, since 1990. I lived in San Diego throughout my entire engagement with Plaintiff RedHawk Holdings Corp. (“RedHawk”) as both an officer and director. I have no ties to the state of Louisiana outside of my contacts with Plaintiffs RedHawk and Beechwood Properties, LLC (“Beechwood”) (collectively “Plaintiffs”). 3. Throughout my tenure as CEO and as a director of RedHawk, I acted in both capacities while in San Diego and made all decisions and actions while based in San Diego. No decisions or actions were made in Louisiana. The nature of my role as an officer and director for RedHawk—including my disclosures to RedHawk and my interactions with Case 2:17-cv-00819-ILRL-DEK Document 26-2 Filed 05/19/17 Page 1 of 9 Beechwood—allowed me to make those decisions while I was in California. RedHawk’s board meetings, for example, occurred telephonically. Plaintiffs never required or requested that I visit or relocate to Lafayette Parish. 4. I was in San Diego throughout the negotiations for the asset purchase agreement (the “APA”) between RedHawk and American Medical Distributors, LLC (“AMD”) that form the basis of Plaintiffs’ complaint. 5. I deny all claims in Plaintiffs’ complaint, as I made all necessary disclosures to Redhawk and did not breach any alleged oral agreement with Beechwood. 6. RedHawk was based in Seal Beach, California at the time I first began his business dealings with the company in 2014. This is verified by the company’s publicly filed documents with the Securities and Exchange Commission (SEC). See RedHawk’s Form 8-K filed on November 17, 2014, noting the company’s former address of 3020 Old Ranch Pkwy., Ste. 300, Seal Beach, California 90740 and its change of address and place of business to 3753 Pennridge Dr., St. Louis, Missouri, 63044 on November 12, 2014, attached as Exhibit “A.” 7. It was not until on or around February 27, 2015, nearly a full year after I had first become involved with the company, that RedHawk moved to Lafayette Parish, Louisiana. See RedHawk’s Form 8-K filed on March 4, 2015, noting the company’s new address at 219 Chemin Metaire Rd., Youngsville, Louisiana 70592, attached as Exhibit “B.” 8. The only reason I was in Baton Rouge was to watch my son play baseball in Hammond, Louisiana, and my only business-related conduct on this trip was a breakfast with a single representative of RedHawk, Darcy Klug. - ! -2 Case 2:17-cv-00819-ILRL-DEK Document 26-2 Filed 05/19/17 Page 2 of 9 9. My visit to New Orleans was for a presentation by an outside company, Ecogen, to RedHawk’s Board of Directors. The meeting occurred approximately on 10/26/15. This meeting was unrelated to the APA and the allegations in Plaintiffs’ complaint, and was the only time the RedHawk Board of Directors met in person while I was on the board. I did not make any representations regarding any purported agreements with Beechwood at these meetings. Any agreements between me and Beechwood were negotiated and entered into at the same time while I was in San Diego. 10. Paul A. Rachmuth is the owner of AMD and based out of New York. 11. Howard Taylor is a former CEO and Chairman of the Board for RedHawk, who lived between St. Louis, Bermuda, and London, England at all times relevant to the complaint. Mr. Taylor served as RedHawk’s CEO from March 31, 2014 until February 27, 2015, and was on the company’s board of directors during this time. To the best of my knowledge, Mr. Taylor is currently residing in England. 12. On April 24, 2017, I, personally and as Trustee of the Trust, filed a lawsuit against RedHawk and its current officers and directors in the United States District Court for the Southern District of California, Case No. 17-cv-0824WQH-BLM, alleging violations of the Uniform Commercial Code for RedHawk refusing to transfer my shares in the corporation, among other allegations. I DECLARE AND AFFIRM UNDER THE PENALTIES OF PERJURY THAT THE FOREGOING FACTS AND REPRESENTATIONS ARE TRUE AND CORRECT. Executed at San Diego, California, this 19th day of May 2017. - ! -3 Case 2:17-cv-00819-ILRL-DEK Document 26-2 Filed 05/19/17 Page 3 of 9 __________________________________________ - ! -4 Case 2:17-cv-00819-ILRL-DEK Document 26-2 Filed 05/19/17 Page 4 of 9 file:///C/Users/owen/Desktop/Schreiber%20Decl.%20-%20Exhibit%20A.txt[5/19/2017 1:06:05 PM] 8-K 1 g7665.txt CURRENT REPORT DATED 11-17-14 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): November 17th 2014 INDEPENDENCE ENERGY CORP. (Exact name of registrant as specified in its charter) Nevada 000-54323 20-3866475 (State or other jurisdiction (Commission (IRS Employer of incorporation) File Number) Identification No.) 3753 Pennridge Drive, St. Louis MO 63044 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (314) 344-1920 3020 Old Ranch Parkway, Suite 300, Seal Beach, CA 90740 (Former name or former address, if changed since last report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT ITEM 3.02 UNREGISTERED SALES OF EQUITY SECURITIES Case 2:17-cv-00819-ILRL-DEK Document 26-2 Filed 05/19/17 Page 5 of 9 file:///C/Users/owen/Desktop/Schreiber%20Decl.%20-%20Exhibit%20A.txt[5/19/2017 1:06:05 PM] Effective November 12th, 2014, Independence Energy Corp. ("Our Company") entered into and closed a securities purchase agreement with two accredited investors. Under the terms of the agreement and for consideration of $50,000 our company issued in the aggregate 14,905,918 common shares and warrants to purchase up to 7,452,959 shares the common shares of the Company. The Warrants entitle the holder to purchase the common shares of the Company at an exercise price equal to $0.005 per share in cash for a period of 2 years from the date of issuance of the Warrant. The Company received the amount of $49,900 after the deduction of closing costs. The common shares were issued pursuant to Rule 506 of Regulation D of the Securities Act of 1933 on the basis that they represented to our company that they were an "accredited investor" as such term is defined in Rule 501(a) of Regulation D. These securities were issued to the investors pursuant to the exemption from registration provided for under Rule 506 of Regulation D, promulgated under the United States Securities Act of 1933, as amended. ITEM 8.01 OTHER EVENTS CHANGE OF ADDRESS OF THE REGISTRANT Effective November 14th 2014 the Company changed its address and place of business to 3753 Pennridge Drive, St. Louis MO 63044 and changed its primary telephone number to (314) 344-1920. ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS 10.1 Form of Securities Purchase Agreement dated November 12th 2014 between the Company and the Purchasers. 10.2 Form of Warrant dated November 12th 2014 issued by the Company to the Purchasers. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. INDEPENDENCE ENERGY CORP. /s/ Gregory C. Rotelli ------------------------------------ Gregory C. Rotelli President and Director Date: November 17th 2014 2 Case 2:17-cv-00819-ILRL-DEK Document 26-2 Filed 05/19/17 Page 6 of 9 5/19/2017 https://www.sec.gov/Archives/edgar/data/1353406/000161577415000392/s100832_8k.htm https://www.sec.gov/Archives/edgar/data/1353406/000161577415000392/s100832_8k.htm 1/3 8K 1 s100832_8k.htm 8K UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): February 27, 2015 INDEPENDENCE ENERGY CORP. (Exact name of registrant as specified in its charter) Nevada (State or other jurisdiction of incorporation) 00054323 (Commission file number) 203866475 (I.R.S. Employer Identification No.) 219 Chemin Metaire Road, Youngsville, Louisiana 70592 (Address of principal executive offices)(Zip Code) (337) 2695933 (Company's telephone number, including area code) 3753 Pennridge Drive, St. Louisiana MO 63044 (Former name or former address, if changed since last report) Check the appropriate box below if the Form 8K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: ☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) ☐ Soliciting material pursuant to Rule 14a12 under the Exchange Act (17 CFR 240.14a12) ☐ Precommencement communications pursuant to Rule 14d2(b) under the Exchange Act (17 CFR 240.14d2(b)) ☐ Precommencement communications pursuant to Rule 13e4(c) under the Exchange Act (17 CFR 240.13e4(c)) Case 2:17-cv-00819-ILRL-DEK Document 26-2 Filed 05/19/17 Page 7 of 9 5/19/2017 https://www.sec.gov/Archives/edgar/data/1353406/000161577415000392/s100832_8k.htm https://www.sec.gov/Archives/edgar/data/1353406/000161577415000392/s100832_8k.htm 2/3 Item 5.02. Departure of Directors or Principal Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. On February 27, 2015, the board of directors appointed Daniel J. Schreiber as the Company’s Chief Executive Officer and G. Darcy Klug as the Company’s Chief Financial Officer and Corporate Secretary, effective immediately. Concurrent with the appointment of Mr. Schreiber, Mr. Howard J. Taylor was removed from his position as the Company’s Chief Executive Officer. Mr. Schreiber has been a director of the Company since March 31, 2014. Mr. Schreiber has been the Chief Executive Officer and President of Avior Capital, LLC (“Avior”) since 1997. Avior specializes in sourcing and structuring real estate and corporate finance transactions. He is responsible for oversight of Avior’s Investment Banking Unit. Mr. Schreiber began his career with Shearson Lehman where he was a Director Council Member. Mr. Klug, is the founder and sole owner of Beechwood Properties, LLC. This company focuses on acquiring, renovating and leasing of select commercial and residential real estate. Mr. Klug is also the owner of several other investment companies including Beechwood Capital Corporation and RedHawk Capital, LLC. Between 2001 and May 2008, Mr. Klug was Executive Vice President (formerly Chief Financial Officer) of OMNI Energy Services Corp. (NASDAQ). From 1987 through May 2001, he was engaged in several private investments in the oilfield service, medical litigation support and manufacturing industries. Between 1983 and 1987, Mr. Klug held various positions with a private oil and gas fabrication company including the position of Chief Operating Officer and Chief Financial Officer. Prior to 1983, he held various positions with GalvestonHouston Company (NYSE), a manufacturer of oil and gas equipment and held the position of Chief Financial Officer of First Matagorda Corporation (NASDAQ), an oil and gas exploration company and affiliate of GalvestonHouston Company. Between 1973 and 1979, he was a member of the audit staff of Coopers & Lybrand (now PricewaterhouseCoopers). Mr. Klug is a 1973 accounting graduate of Louisiana State University and, in 1974, was admitted as a member of the Louisiana State Board of Certified Public Accountants, the Texas State Board of Certified Public Accountants and the American Institute of Certified Public Accountants. There are no arrangements or understandings between Messrs. Schreiber or Klug and any other persons pursuant to which they were appointed Chief Executive Officer and Chief Financial Officer and Corporate Secretary, respectively. There are no transactions reportable pursuant to Item 404(a) of Regulation SK in connection with Messrs. Schreiber’s or Klug’s appointments At this time, Messrs. Schreiber and Klug will not receive any compensation for their service as the Company’s Chief Executive Officer and Chief Financial Officer and Corporate Secretary, respectively. 2 Case 2:17-cv-00819-ILRL-DEK Document 26-2 Filed 05/19/17 Page 8 of 9 5/19/2017 https://www.sec.gov/Archives/edgar/data/1353406/000161577415000392/s100832_8k.htm https://www.sec.gov/Archives/edgar/data/1353406/000161577415000392/s100832_8k.htm 3/3 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Date: March 4, 2015 Independence Energy Corp. By: /s/ Daniel J. Schreiber Name: Daniel J. Schreiber Title: Chief Executive Officer and Director 3 Case 2:17-cv-00819-ILRL-DEK Document 26-2 Filed 05/19/17 Page 9 of 9 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA REDHAWK HOLDINGS CORP. AND * CIVIL ACTION NO. 17-819(B)(3) BEACHWOOD PROPERTIES, LLC * * JUDGE LEMELLE VS. * * MAGISTRATE JUDGE KNOWLES DANIEL J. SCHREIBER AND * SCHREIBER LIVING TRUST * – DTD 2/08/95 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * NOTICE OF SUBMISSION PLEASE TAKE NOTICE that Defendants, Daniel J. Schreiber and Daniel J. Schreiber, Trustee of the Schreiber Living Trust—DTD 2/08/95, submit their Rule 12(b)(3) Motion to Dismiss Pursuant to 28 U.S.C. § 1406(a) or, in the Alternative, to Transfer Pursuant to 28 U.S.C. § 1406(a) or § 1404(a) for hearing before the Honorable Ivan L.R. Lemelle, United States District Judge, 500 Poydras Street, New Orleans, Louisiana 70130, on June 7, 2017, at 9:00 a.m., or as soon thereafter as counsel can be heard. Case 2:17-cv-00819-ILRL-DEK Document 26-3 Filed 05/19/17 Page 1 of 2 -2- Respectfully submitted, /s/ Matt Jones Paul Matthew Jones, T.A. (#19641) LISKOW & LEWIS 822 Harding Street P.O. Box 52008 Lafayette, Louisiana 70505-2008 Telephone (337) 232-7424 Facsimile (337) 267-2399 Dana M. Douglas (Bar #26866) Kathryn Z. Gonski (Bar #33442) LISKOW & LEWIS 701 Poydras Street, Suite 5000 New Orleans, Louisiana 70139-5099 Telephone: (504) 581-7979 Facsimile: (504) 556-4108 Attorneys for Daniel J. Schreiber and Daniel J. Schreiber, Trustee of the Schreiber Living Trust—DTD 2/08/95 CERTIFICATE OF SERVICE I HEREBY CERTIFY that a copy of the above and foregoing pleading was served upon all counsel of record by electronic mail on the 19th of May, 2017, and by the Clerk of Court via the CM/ECF system this 22nd of May, 2017. /s/ Matt Jones Case 2:17-cv-00819-ILRL-DEK Document 26-3 Filed 05/19/17 Page 2 of 2
