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LAW OFFICE OF HARTWELL HARRIS Hartwell Harris (California Bar No. 241695) 1809 Idaho Avenue Santa Monica, California 90403 Telephone: (310) 497-8858 Facsimile: (310) 998-1167 hartwell@hartwellharris.com Attorney Defendants RAYMOND MOBREZ ILIANA LLANERAS ASIA ECONOMIC INSTITUTE, LLC UNITED STATES DISTRICT COURT DISTRICT OF ARIZONA

XCENTRIC VENTURES, LLC, an Arizona limited liability company, Plaintiff, vs. LISA JEAN BORODKIN and JOHN DOE BORODKIN, husband and wife; RAYMOND MOBREZ and ILIANA LLANERAS, husband and wife; DANIEL BLACKERT and JANE DOE BLACKERT, husband and wife; ASIA ECONOMIC INSTITUTE, LLC, a California limited liability company; DOES 1-10, inclusive, Defendants.

CASE NO.: CV-11-1426-PHX-GMS MOTION TO DISMISS FOR IMPROPER VENUE; OR IN ALTERNATIVE TO TRANFER FOR IMPROPER VENUE (28 USC 1406(A)); OR IN THE ALTERNATIVE TO TRANSFER FOR CONVENIENCE (28 USC 1404(A)) (Oral Argument Requested) [Motion to Dismiss for Lack of Personal Jurisdiction, Declarations of Raymond Mobrez, Iliana Llaners, and Hartwell Harris filed concurrently herewith]

Defendants Raymond Mobrez, Iliana Llaneras, and Asia Economic Institute, LLC (AEI) (referred to collectively as Defendants) hereby move pursuant to Federal Rule of Civil Procedure 12(b)(3) for an order dismissing this action on the ground that the venue is improper; or in the alternative, to transfer this action to the Central District of

MOTION TO DISMISS FOR IMPROPER VENUE OR IN ALTERNATIVE TO TRANSFER

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California pursuant to 28 U.S.C. 1406(a), or in the alternative to transfer for convenience pursuant to 28 U.S.C. 1404(a). This motion is supported by the following Memorandum of Points and Authorities, the declarations of Raymond Mobrez, Iliana Llaneras, and Hartwell Harris filed and served herewith, and upon the papers, records and pleadings on file herein. MEMORANDUM OF POINTS AND AUTHORITIES I. BACKGROUND Plaintiffs Complaint asserts abuse of process claims against Asia Economic Institute LLC (AEI), Raymond Mobrez, and Iliana Llaneras (collectively referred to herein as Defendants) as well as the two lawyers who represented Defendants in the underling matter litigated in the Central District of California. (AEI v. Xcentric Ventures, LLC, Case no. 2:10-cv-01360-SVW-PJW). The Complaint lists two tort causes of action arising out of that litigation: Wrongful Initiation of Civil Proceedings and Wrongful Continuation of Civil Proceedings. Plaintiff Xcentric Ventures, LLC (Xcentric) is an Arizona company based in Arizona. (See Complaint (Compl.) at 3). Plaintiff claims to operate a consumer information and advocacy website at www.ripoffreport.com (Ripoff Report), where consumers and other visitors to the website can post complaints regarding companies. (Compl. at 12). Non-party Ed Magedson is the manager and an owner of Xcentric and was a defendant in the underlying action. (Compl. at 9). Defendant AEI is a California limited liability company, with its principal place of business in California. (See Declaration of Raymond Mobrez (Mobrez Decl.) at 6). The company operated from 2000 June 2009 as a free, online, non-governmental publication of current news and events. (Id. at 7). AEI has effectively been a defunct entity since 2009 after false postings on Xcentrics website put it out of business. (Id. at 7). AEI was owned and operated by its principals Mobrez and Llaneras.

-2MOTION TO DISMISS FOR IMPROPER VENUE OR IN ALTERNATIVE TO TRANSFER

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AEI has never conducted any business in Arizona or solicited any business in Arizona. AEI has never done any business with the Plaintiff. AEI has no contracts with the Plaintiff or with any Arizona companies. AEI does not own any assets in Arizona, have any offices in Arizona, or have any agents in Arizona, and AEI does not conduct any business in Arizona. (Id. at 8.). Defendant Raymond Mobrez is a married man and a resident of the State of California and has been a resident of the State of California for approximately 35 years. (Id. at 3). He has never resided in the State of Arizona. He has never owned property in Arizona. He has never employed agents or employees in Arizona. (Id. at 5). Defendant Iliana Llaneras is a married woman and a resident of the State of California and has been a resident of the State of California for approximately 40 years. (See Declaration of Iliana Llaneras (Llaneras Decl.) at 3). She has never resided in the State of Arizona. She has never owned property in Arizona. She has never employed agents or employees in Arizona. (Id. at 5). II. THIS COURT SHOULD DISMISS THIS CASE BASED ON IMPROPER VENUE Defendants move for an order dismissing this action because venue is improper. Federal subject matter jurisdiction is based on diversity of citizenship in the instant case. (Compl. at 10). Plaintiff has filed its case in an improper venue according to 20 U.S.C. 1391(a) which states: A civil action wherein jurisdiction is founded only on diversity of citizenship may, except as otherwise provided by law, be brought only in (1) (2) A judicial district where any defendant resides, if all defendants reside in the same State, 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
-3MOTION TO DISMISS FOR IMPROPER VENUE OR IN ALTERNATIVE TO TRANSFER

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-4MOTION TO DISMISS FOR IMPROPER VENUE OR IN ALTERNATIVE TO TRANSFER

(3)

A judicial district in which any defendant is subject to personal jurisdiction at the time the action is commenced, if there is no district in which the action may otherwise be brought.

Since Plaintiff bases federal subject matter jurisdiction solely on diversity of citizenship (Compl. at 10), venue is proper pursuant to 20 U.S.C. 1391(a)(1) in the Central District of California and because all defendants reside in California. (Compl. at 4-7; see also Mobrez Decl. at 1; Llaneras Decl. 1; Summons for Lisa Borodkin at Ex. B to Declaration of Hartwell Harris (Harris Decl.); Summons for Daniel Blackert at Ex. C to Harris Decl.). Moreover, the Central District of California is the only venue for this case because a substantial part of the events or omissions giving rise to the claim occurred in the Central District of California. Plaintiff bases his choice of venue on 20 U.S.C. 1391(a)(2). But, all of the events alleged in Plaintiffs Complaint relate to the allegedly tortious prosecution of a lawsuit in California instituted against Plaintiff. The Complaint alleges that Defendants decided to file suit, to perform legal research, and to formulate a litigation strategy (Compl. at 23-25) presumably in California where they reside. The underlying action was originally filed in Los Angeles Superior Court. (Compl. at 28). All the hearings took place in the Central District of California (Compl. at 31, 54, 6162). Critically, all the declarations were made there, and Plaintiffs factual allegations depend heavily on the declarations and corrected declarations made by Defendants as a primary source of proof. (Compl. at 34, 35, 37, 49). Defendants move this Court to dismiss this action for improper venue as mandated by 28 U.S.C. 1406(a): The district court of a district in which is filed a case laying venue in the wrong division or district shall dismiss, or if it be in the interest of justice, transfer such case to any district or division in which it could have been brought. (emphasis added).

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While transfer is an alternative to dismissal, Defendants plan to file a special motion to strike (anti-SLAPP motion). Arizona law and California law differ in this area. Furthermore, deadlines for these motions may come and go before venue is determined. So in the interest of efficiency, Defendants wish to file its anti-SLAPP motion after questions of venue and choice of law have been decided in order to avoid drafting two different motions based on different state law. A dismissal for improper venue will allow Plaintiff to re-file this case in the proper venue which restarts the clock on filing deadlines resulting in a much simpler and more definite calendar for the parties. III. IN THE ALTERNATIVE, THIS COURT SHOULD TRANSFER THIS CASE TO THE CENTRAL DISTRICT OF CALIFORNIA If the Court decides not to dismiss the case, it has other alternatives. When venue is improper, as in this case, the Court may, in the interests of justice, transfer the case to a district in which it could have been brought. Twenty-eight U.S.C. 1406(a) mandates dismissal or transfer when Plaintiff has filed a case in an improper venue: The district court of a district in which is filed a case laying venue in the wrong division or district shall dismiss, or if it be in the interest of justice, transfer such case to any district or division in which it could have been brought. (emphasis added) Under the facts set forth in the Complaint, this case should have been brought in the Central District of California because subject matter jurisdiction is based on diversity, all defendants reside in California, and/or a substantial number of events or omissions occurred in the Central District of California. Thus, if this Court chooses not to dismiss, the Court should direct the Clerk to transfer this action to the Central District of California. Finally, the Court also has the option to transfer this case based on convenience. See 28 U.S.C. 1404(a) which states: For the convenience of parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought. Whether to transfer involves a two-step process. First, the district to which transfer is made must be a place where the action
-5MOTION TO DISMISS FOR IMPROPER VENUE OR IN ALTERNATIVE TO TRANSFER

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originally might have been brought. Hatch v. Reliance Ins. Co., 758 F.2d 409, 414 (9th Cir. 1985). Second, the convenience of the parties and witnesses, in the interest of justice, must favor the transfer. Id. Plaintiffs abuse of process claims in this lawsuit arise out of an underlying lawsuit that was litigated in the Central District of California. So the first step of the transfer analysis is satisfied. The second step involves the weighing of multiple factors. Under 1404(a), the district court has discretion to adjudicate motions for transfer according to an individualized, case-by-case consideration of convenience and fairness. See, e.g., GNC Franchising, Inc. v. Jones, 211 F.3d 495, 498-99 (9th Cir. 2000). A motion to transfer venue under 1404(a) requires the court to weigh multiple factors in its determination whether transfer is appropriate in a particular case. Id. Courts in the Ninth Circuit have considered various factors such as, but not limited to, (1) convenience of the parties and witnesses, (2) the interest of justice, (3) forums familiarity with the applicable law, (4) differences in costs in litigating in the different forums, (5) availability of compulsory process over unwilling witnesses, and (6) plaintiffs choice of forum. See, e.g., GNC Franchising, 211 F.3d at 498-99 (9th Cir. 2000); Decker Coal Co. v. Commonwealth Edison, 805 F.2d 834, 843 (9th Cir. 2007). The Court must determine whether California is a more convenient forum than the District of Arizona, and whether a transfer would serve the interests of justice. Hatch, 758 F.2d at 414. Indeed the factors present in this case substantially favor transfer. 1. Convenience of the Parties and Witnesses

Only one party resides in Arizona, Plaintiff. All defendants are located in California. All witnesses are located in California to Defendants knowledge, likely including Ed Magedson, the manager of Xcentric. (Mobrez Decl. at 10). All of the witnesses would be forced to travel to Arizona for a trial, and would bear an inordinate amount of expenses to adequately defend the case, including taking of depositions and
-6MOTION TO DISMISS FOR IMPROPER VENUE OR IN ALTERNATIVE TO TRANSFER

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conducting other pre-trial discovery here. The relative convenience of witnesses, both party and non-party, is often recognized as the most important factor to be considered in a section 1404(a) motion. Salah v. Titan Corp., 361 F. Supp. 2d 1152, 1160 (S.D. Cal. 2005); International Comfort Products, Inc. v. Hanover House, 739 F. Supp. 503, 507 (D. Ariz. 1989). 2. Interests of Justice

Because this case involves process issued by the Central District of California and the related litigation that occurred there the interests of justice warrant having that court try this case. Further this case has only just begun, and there has been no time or resources wasted as this motion is the first filed. Generally, abuse of process claims should be tried where the underlying case occurred. Restatement (Second) of Conflicts, Section 155 states: The rights and liabilities of the parties for malicious prosecution or abuse of process are determined by the local law of the state where the proceeding complained of occurred, unless, with respect to the particular issue, some other state has a more significant relationship under the principles stated in Section 6 to the occurrence and the parties, in which event the local law of the other state will be applied. Arizona follows the Restatement in the absence of any statement otherwise. Bohreer v. Erie Insurance Exchange, 216 Ariz. 208, 215 26 (App. 2007). There is no greater interest in Arizona under the considerations in Section 6 of the Restatement. 3. California is the State that is Most Familiar with the Governing Law

This factor is critical for this Court to consider. Plaintiff admits in his Complaint that it was secretly taping telephone conversations between Ed Magedson, and Mobrez: Unbeknownst to Defendants MOBREZ and LLANERAS, all of Defendant MOBREZs calls to the Ripoff Report website were automatically recorded by Xcentrics phone system. (Compl. at 41). The allegations in Plaintiffs Complaint depend heavily on these recorded conversations. These recordings, though, violate California penal law, and
-7MOTION TO DISMISS FOR IMPROPER VENUE OR IN ALTERNATIVE TO TRANSFER

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such tapes are inadmissible as evidence at trial in California. Arizonas laws differ. Their admissibility was a contentious issue in the underlying action. Since this is a case based solely on diversity and does not include any federal question, the laws of the forum govern the admissibility of recorded conversations. Feldman v. Allstate Insurance Comp., 322 F.3d 660, 666-68 (9th Cir. 2003). The statute outlawing secretly taping conversations embodies a state substantive interest in the privacy of California citizens from exposure of their confidential conversations to third parties. We also note that the California Constitution expressly guarantees a right to privacy. Id. at 667. Furthermore, the Hon. Stephen V. Wilson stated on page 22 lines 4-10 in his 7/19/10 Order issued in the underlying case: Furthermore, even though the recordings complied with the laws in the forum state in which the recordings were made (Arizona), if the Court were to engage in a choice-of-law analysis between Arizona and California law, the Court undoubtedly would apply California law, given Californias strong public interest in protecting the confidentiality of certain communications. (Ex. D to Harris Decl.). This factor weighs in favor of Defendants. 4. The Differences in the Costs of Litigation in the Two Forums

There is one business in Arizona and at least four defendants in California. Furthermore, Ed Magedson likely resides in California. (See Mobrez Decl. at 10). The cost for Plaintiff to litigate in California is simply a cost of doing business. In fact, Magedson boasts about Xcentrics litigiousness in his email to Mobrez: Weve spent over 3.4 million in legal fees never lost a case people know, we DO NOT RMEOVE [sic] REPORTS You can file a rebuttal No amount of money can change this. Even if you were the pope,. [sic] It would not make a difference. The pope has access to a computer Im sure.
-8MOTION TO DISMISS FOR IMPROPER VENUE OR IN ALTERNATIVE TO TRANSFER

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(Ex. A to Mobrez Decl.). The cost to Defendants, two individuals and a defunct company, would be substantial and far outweigh that of Plaintiff. This factor weighs in favor of Defendants. 5. The Availability of Compulsory Process

California has compulsory process over witnesses in California. It is not likely that Plaintiff has any witnesses in Arizona over whom compulsory process is needed either for testimony or documents. 6. The Plaintiffs Choice of Forum is Not Controlling

[I]n this circuit, the plaintiffs convenience is not of paramount importance. Dole Food Co. Inc. v. Watts, 303 F.3d 1104, 1116 (9th Cir. 2002). Although Plaintiffs primary place of business is in Arizona, Arizona has no specific interest in having this controversy decided here. IV. CONCLUSION This Court should dismiss this case for improper venue. Alternatively, this Court should transfer this matter to the Central District of California. DATE: Sept. 30, 2011 LAW OFFICES OF HARTWELL HARRIS

By /s/ Hartwell Harris Hartwell Harris Attorney for Raymond Mobrez, Iliana Llaneras, and Asia Economic Institute, LLC.

-9MOTION TO DISMISS FOR IMPROPER VENUE OR IN ALTERNATIVE TO TRANSFER

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-10MOTION TO DISMISS FOR IMPROPER VENUE OR IN ALTERNATIVE TO TRANSFER

CERTIFICATE OF SERVICE I hereby certify that on September 30, 2011 I electronically transmitted the attached document to the Clerks Office using the CM/ECF System for filing, and for transmittal of a Notice of Electronic Filing to the following: David Gringais Gingras Law Office, PLLC 3941 E. Chandler Blvd., #106-243 Phoenix, AZ 85048 Lisa J. Borodkin Iverson, Yoakum, Papiano & Hatch 633 W. 5th Street, Suite 6400 Los Angeles, CA 90071 Daniel Blackert P.O. Box 2092 Los Angeles, CA 90078 And a courtesy copy of the foregoing delivered to: HONORABLE G. MURRY SNOW United States District Court Sandra Day OConnor U.S. Courthouse Suite 622 401 West Washington Street, SPC 80 Phoenix, AZ 85003-215 __/s/ Hartwell Harris___________

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