Defendant Thomas DiBiase's Reply in Support of Proposed Order Finding Righthaven in Contempt of Court and Imposing Sanctions

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CASE NO.: 2:10-cv-1343 RLH PAL
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   12345678910111213141516171819202122232425262728COLLEEN BAL (  pro hac vice )cbal@wsgr.comWILSON SONSINI GOODRICH & ROSATI650 Page Mill RoadPalo Alto, CA 94304-1050Telephone: (650) 493-9300Facsimile: (650) 493-6811CHAD BOWERS bowers@lawyer.comCHAD A. BOWERS, LTD Nevada State Bar No. 72833202 West Charleston BoulevardLas Vegas, Nevada 89102Telephone: (702) 457-1001Attorneys for Defendant & CounterclaimantTHOMAS A. DIBIASEKURT OPSAHL (  pro hac vice )kurt@eff.orgCORYNNE MCSHERRY (  pro hac vice )corynne@eff.orgELECTRONIC FRONTIER FOUNDATION454 Shotwell StreetSan Francisco, CA 94110Telephone: (415) 436-9333Facsimile: (415) 436-9993 UNITED STATES DISTRICT COURTFOR THE DISTRICT OF NEVADA RIGHTHAVEN LLC, a Nevada limited-liabilitycompany,Plaintiff,v.THOMAS A. DIBIASE, an individual,Defendant. _______________________________________ THOMAS A. DIBIASE, an individual,Counterclaimant,v.RIGHTHAVEN LLC, a Nevada Limited-Liability Company,Counter-defendant.)))))))))))))))))))))))))CASE NO.: 2:10-cv-1343 RLH PAL DEFENDANT THOMAS DIBIASE’SREPLY IN SUPPORT OF PROPOSEDORDER FINDING RIGHTHAVEN INCONTEMPT OF COURT ANDIMPOSING SANCTIONS Case 2:10-cv-01343-RLH -PAL Document 112 Filed 03/29/12 Page 1 of 20   12345678910111213141516171819202122232425262728i TABLE OF CONTENTS I. ! Introduction .................................................................................................................................. 1II. ! Argument .................................................................................................................................... 2A. ! Righthaven’s CEO Steven Gibson Has the Ability to Comply ................................... 2B. ! Righthaven and its CEO Steven Gibson Had Notice .................................................. 5C. ! Coercive Sanctions Against Steven Gibson Remain Proper ....................................... 8III. ! Conclusion ................................................................................................................................. 9 !   Case 2:10-cv-01343-RLH -PAL Document 112 Filed 03/29/12 Page 2 of 20   123456789101112131415161718192021222324252627281 I.   Introduction If further evidence of the contempt of Steven Gibson, CEO of Plaintiff Righthaven LLC, 1  for this Court were needed, it is provided by his response to the Proposed Order. Where a degree of contrition would be more appropriate, Mr. Gibson offers excuses and proposals for further delays,none of which explains Righthaven’s ongoing failure to be “reasonably diligent and energetic inattempting” to accomplish what this Court ordered.  E.E.O.C. v. Local 638, Local 28 of Sheet  Metal Workers’ Int’l Ass’n, 753 F.2d 1172, 1178 (2d Cir.1985), aff’d  , 478 U.S. 421 (1986).Mr. Gibson proposes that the Court place responsibility solely on its counsel of record, ShawnMangano. Given that, as even Mr. Gibson acknowledges, Mr. Mangano is nowhere to be found,this is actually a request for Righthaven, and Mr. Gibson, to avoid all accountability.Mr. Gibson’s proposal runs directly contrary to settled law. “An order issued to acorporation is identical to an order issued to its officers, for incorporeal abstractions act throughagents.”  Reich v. Sea Sprite Boat Co ., 50 F.3d 413, 417 (7th Cir. 1995); accord     N.L.R.B. v. Sequoia Dist. Council of Carpenters, AFL-CIO , 568 F.2d 628, 634 (9th Cir. 1977). Thus, Mr. Mangano’sunavailability does not absolve Righthaven of responsibility. Mr. Gibson can hire another lawyer or get it done himself.The time for excuses and blaming others has long since past. Mr. Gibson, as CEO and the principal officer of Righthaven, has to comply with this Court’s order and purge the ongoingcontempt of court. There really is a simple solution for this problem (that should not have requiredall these hearings or briefs): hand over the documents . Because he continues to fail to do so,Mr. Gibson must be sanctioned for his contempt of court.Accordingly, Defendant Thomas DiBiase respectfully requests this Court enter the order he proposed. 1 Mr. Gibson claims to be a non-party. There is a host of compelling evidence that Righthaven isactually an alter-ego of Mr. Gibson. However, this Court need not decide that issue yet, becausethe case law “does not require that the corporate veil be capable of being pierced prior to imposing personal liability on the corporate officers responsible for insuring the corporation's compliancewith a court order.” Connolly v. J.T. Ventures , 851 F.2d 930, 935 (7th Cir. 1988); accord N.L.R.B.v. Maine Caterers, Inc ., 732 F. 2d 689 (1st Cir. 1984). Case 2:10-cv-01343-RLH -PAL Document 112 Filed 03/29/12 Page 3 of 20   123456789101112131415161718192021222324252627282 II.   ArgumentA.   Righthaven’s CEO Steven Gibson Has the Ability to Comply To excuse his failures, Mr. Gibson claims to be at “a complete legal inability” to comply,and that “[a]s CEO of Righthaven, I do not have any means to effect compliance with the MinuteOrder to the extent I even have full cognizance of same.” Gibson’s Response to DiBiase’sProposed Order (Dkt. 110) at 2, 3. This argument is meritless. Mr. Gibson is the CEO, Manager,in-house counsel and principal employee of Righthaven – he certainly has the legal  ability to provide both the transcript and Righthaven’s documents. See    generally Righthaven OperatingAgreement (Dkt. 51-2) at §§ 5.2 (Certain Powers of the Manager), 6.3 (Authority of the CEO).Indeed, the principal officer is precisely the person one would expect to provide responsivedocuments.Mr. Gibson’s claim that he has “not heard from Righthaven’s legal counsel [Mr. Mangano]since February, 2012,” and that Mr. Mangano has simply disappeared is similar to Mr. DiBiase’sexperience. 2 Resp. at 3. However, it is quite perplexing in light of Righthaven’s consent to thewithdrawal of attorney Dale Cendali just last week in  Righthaven v. Democratic Underground  ,Case No. 10-cv-01356-RLH-GWF (Dkt. 186) (March 21, 2012), knowingly leaving that casesolely in the hands of Mr. Mangano. Presumably Mr. Gibson, as a responsible CEO, would notgive that consent knowing it left Righthaven without representation.Mr. Gibson also takes great pains to claim to have done everything in his power:There has been no request made of me by Mangano that I did not fully cooperatewith and I have, as CEO of Righthaven, at all times instructed Mangano to fullycomply with all court orders to the best of Righthaven’s ability.Resp. at 5. However, Mr. Gibson cannot reconcile this self-serving assertion with Righthaven’sactual behavior, such as its failure to comply with a $5,000 sanctions order by Judge Roger Hunt in  Righthaven v. Democratic Underground  , Minute Order on Show Cause Hearing (Dkt. 138)(D. Nev. July 14, 2011) (“Righthaven is sanctioned in the amount of $5,000.00 which shall be paidto the Clerk of Court within two weeks.”). As explained previously, Righthaven had sufficient 2 Counsel for Mr. DiBiase have also not heard from Mr. Mangano since mid-February. See OpsahlDecl., at ¶¶ 8-10. It is unclear whether he is unable or unwilling to act as an attorney. Case 2:10-cv-01343-RLH -PAL Document 112 Filed 03/29/12 Page 4 of 20
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