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INTRODUCTION AND SUMMARY OF RELEVANT FACTS

Plain-tiff John Unger ("Plaintiff') worked for Pizza 1-Jut of Apache Junction, inc. ("Pizza

Hut") for about 10-1/2 months from May 1999 until March 2000. He brought this lawsuit

against. Pizza Rut and various members of the Carter family who worked for Pizza Hat, alleging

that certain of the Carters mistreated him while Plaintiff was a Pizza .Rut employee. According

to Piatntjffs deposition testimony, he experienced very , little of what could he deemed

mistreatment. Rather, the great bulk of his scattershot allegations involve alleged acts of

misconduct by two former restaurant managers. Rick and Tim Carter, that. were not directed at

Plaintiff and/or were events that Plaintiff only heard about from co-workers.

For example, among Plaintiffs accusations are that Rick and Tim took illegal drugs

duting work hours. stole. money from the business and from other employees (not Plaintiff), and

made sxuai advances on underage female em ployees. Pizza Hut believes that Plaintiff was

encouraged to file this lawsuit by a con artist named Ed Magedson who has a history of targeting

1 businesses with extortion, threats and, if the businesses do not pay, publishing defaiiiatoiy

statements about them on his personal website, www.ripoffreport.com , and to the news media.

Accordingly, all the defendants have been represented together by one set of defense. counsel.

Such joint representation, however, is no longer ethically possible. New defetise counsel

(Seyfarth Shaw) substituted in for former counsel (Baker & McKenzie) in January 2003). After

gcltmg up to speed on the case aiid takin,g and defending .hey depositions (the fist taken in this

action), counsel realized that, notwithstanding that this lawsuit, is a fraud, a con fli't of interest

exists between Pizza Hut and Rick and Tim Carter.

.In parucul.ar, one.of Pizza I-luVs arguments 'in its upcoming summary judgment motion

will be that any alleged "mi.sconduct" by Rick and Tim Carter were outside the course and scope

of their employment and, thus. is Rick and. Tim Carter's responsibility rather than Pizza Huts.

Gerald TVlaatmau, the attorney at Baker &. McKenzie who had the relationship with Lexington Insurance, IL tnsw ci paying, foi the dcfcnsc in this 111 thci Jell Bahei & McKenzie 10

join Suvlai th []d'\ Ii) uailv 200' ind hi ought this cast v illi him Mi Mdatln'm now er has had no direct mvolvei.nent as an attorney in this action.

.4 .Doftndants' Motion to Withdraw and to Continue Trial

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While Pizza Nut will raise other arguments that apply to all the defendants, the existence or a

bona tide summary judgment argument that pits IWO defendants against one another precludes

one coiLusci from representing both of the conflicting parties as a matter of law.

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In addition to this conflict, a separate impediment to Scyfarth. Shaw's ability to continue

to represent Tim Carter has arisen. Tim Carter has become cstrnmzed from his faniJy, has

6 moved out of state, and has cut off all toniact with his iimily and. his legal counsel, indeed,

/ none of his family members have been able to contact Tim Carter for the-last several months.

8 Sev,farth Shaw cannol competently represent .-a client who refuses to speak with them or

9 participate in his own defense. Thus, the Court should allow Seyfarth Shaw to withdraw from

1.0 representing Tim Carter

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In addition to moving for S.eyfarth Shaw to withdraw as counsel for Rick and Tim Carter,

the moving defendants also seek a trial continuance of at least ninety (90) days. First ) this

continuance is essential to give Rick Carter time to find counsel of his own so that he can

14 adequately prepare for trial. Second, additional time is required to locate and depose a key

15 witness, Ed Magedson. Plaintiffs counsel initially agreed to produce Mr. Magedso;n for a

16 telephonic deposition but then withdrew that offer at the eleventh hour. Since that tine, Mr

Magedson has beeia actively evading service.. The moving defendant thus reqwxe tiC to find

18 Mr. Magedson and subpoena him for deposition concerning his participation in this extortion

19 scheme against Pizza Hut as well as his history of similar illegal endeavors involving other

20 Arizona businesses This is the first coiltinuance anyone has requested in this action, and

21 granting it should not pi•jjcc Plaintiff.

In sum. the moving defendants respectfully request that the Court grant this motion in .its

entirety, thereby allowing Sevfarih Shaw to withdraw as cotrng-ellbr Rict and Tim Carter and

24 continuing the trial ninety (90) days.

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5 Defendants' Motion to Withdraw and to Continue Trial

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OomQ —U3 05:18pr Frvn-SEYFARWF SHAD! ATTORNEYS 310-20-6219 T-073 P-097/008 F-958

18. Investigation and discovery has revealed that the testimony of Ed Magedson is

needed. Mr. Magedson was intimately involved in the filing of this lawsuit. Shortly after

Plaintiff stopped coming to work, lbs. Magedson spoke on the telephone with Doug Kreie on

multiple Occasions, pretending to be John Unger's brother, Ed Unger, In the second of these

conversations (which Mr. Magedson tape recorded), Mr. Magedson threatened that if Pizza Hut

did net pay John Unger blacknxail money, Mr. Magedson would make inflammatory allegations

.gaimt Pizza Hut in the news media. Attached hereto as Exhibit "B" is a true and correci

transcription of t hose tape. recordings, which were produced by plaintiff to defendants. The

potion in which Mr. Magedson threatened Mr. Kreie is highlighted.

19. I ivestigation and discovery has revealed that Mr. Magedson did indeed publish

false and defaxnatory information about Pizza Hut on his personal web site,

vvww.ripoffTeport.com , and in various newspapers. In these publications, Mt Magedson made a

series of libelous statements including that Pizza But was requiring its pizza delivery drivers to

i drugs on the Job—something even Plaintiff has admitted to be false. Attached hereto. as

Exhibit "C" is a true and correct copy of a sampling of the false and defamatory information on

Mr. Magedson's website.

20. In the depositions of third party witnesses that took place, dung May, I. further

1eaxned

that Mr. Magedson took out advertisements in the kcal media soliciting disgruntled

former employees to contact him to provide statements about their problems with Pizza Rut.

Attached hereto as 2xhi.bit "D" is a true and correct copy of one of those solicitations that

appe• -redin the classified section of the Apache Junction Independent on November 14, 2000_

21 _ Mr. Magedson tape recorded several interviews he conducted with the witnesses

he.

solicited. Mr. Magedson then directed both Plaintiff and the various fonner Pizza Rats

employees to Plaintiff's current counsel, Maria Speth, to participate in the instant action and t.e

related Loay lawsuit : Thai fact wa also confirmedin the depositions of several of the witnesses

I dep.osed.dunng May. Indeed, investigation and discovery..has revealed that at one time Mi,

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6~ tt~ 2.9.3 eclaration of omas R . Kauf Zan in Support c f otion to ithdraw

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I When we hired Rick Carter in 1998. 1 understood he had some difficulties with the law in the

2 1 past. it was not our policy to Perfonn formal background checks on people since turnover i8

3 pretty high and it is not cost effective to check the background ofall applicants.

4 6. O•ther than knowing: generally that Rick had SOnIC sort of criminal record beforc

5 returning to work at Pizza Hut in 1998, I had no knowledge that Rick Carter was someone likely

6 to mistreat employees, heterosexual or homosexual. Apache Junction was a difficult place to

7 find good. employees, and I approved the hiring of Rick Carter because I knew he had restaurant

8 management experience, he appeared to have his life together, and J. believed in allowing people

9 second chances in life.

10 7. It is our company policy that delivery drivers must have automobile insurance and

.11. a good. driving record to hold the position. Having a single moving violation is not disqualifying

12 but having several, tickets would he. We require the employees to turn in proof of current

13 insurance at the time of hiring, and to do so in January of each year. 1. have reviewed Mr.

14 Ung'ers personnel file and see that the last insurance 6ard he tendered was in Januar 2000. and.

1 5 that card expired during that month..

16 8. John Un.ger reported to his store manager that he received a speeding ticket in

1 1, March 2000. As a result of this ticket, a routine check was performed on Mr. Ungers driving

18 record and insurance coverage. 1. received word from Tim Carter during March that lie had

19 checked the file and saw that Mr. Unger did not have proof of current insurance. Tim told me he

2() did not know what lie should do about it.

21 9. As a result, I called h'ir. Ungers State Farm insurance agent and inquired whether

22 he had current insurance. In the course of the discussion I disclosed that I was calling on behalf

23 of Mr. Unger's employer, Pizza i'lut,.and that Mr. Unger was a. delivery driver for us State Farm

24 confirmed that Mr. linger had current auto in,surauce, but not proper insurance as a delivery

25 driver.

26 10. Before .1 had a chance to get back to Tim Carter, I received word from him that

Mr. Unger was upset because John had been told that, pursuant to company policy, he could 'not

work as a delivery driver until the insurance 'issue was resolved. Tim. -gave me Mr. Ungers

7 Appendix of Evidence in Support o 'iS I

E,Al..c4IQ.,i:.i (Declarations of Thomas R. Kaufman, Dou :glas Kreie and Betty Carter)

•1 phone number and asked that I call him to discuss the situation. I did so, and in the course of the

2 conversation with Mr. Unger someone with a thick New York accent came.on the phone

3 purporting to he Ed Unger," John's brother. J now understand that "Ed. t.Jnger" was actually Ed

4 Magedson, and Mr. Magedson began tape recording the conversation part of -the way through

5 '11. As the transcript of the tape recording reflects. I informed Mr. Unger about the

6 situation with his insurance. Mr. Unger told. me that State Farm had not known. he was a delivery

7 driver and had told. him that they would eaxicel his insurance unless he quit his job because they

g do not cover del iverydrivers. I told. him that I found that surprising because I kiiew of some

9 drivers who had State Farm insurance. I clarified that, as long as Mr. linger had insurance, he

1.0 COuld work as a delivery driver.

I I .

U. in this conversation. both "Ed Unger" and John Unger made a long series of

12 rarnblixig accusations that were a bit hard to follow. one accusation that was apparently before

I 3 the tape recording began was that John had wanted to get in touch with .me sooner but my phone

. 14 number was not posted anywhere in the restaurant so be did not iuiow how to reach me As the

15 transcript reflects, John and "Ed Unger" also inade the following scattershot allegations: that (1)

16 John had reported to Betty Carter that Rick was molesting girls and doing. something with drugs;

17 (2) Management had been throwing away sales tickets at the Pizza Hut and pocketing the money;

18 (3) Tim Carter had once gone. to jail for stealing $4000 from the Pizza i-Jut; (4) Betty had been

19 moVifle around one of her SOflS to wokmg at other stores; (5) someone unspecified had

20 threatened John with hanging him. on a fence; (6) John had received a speeding licket unfairly

21 from an officer who had been at the Pizza Hut when Betty called the police one night to report: a

22 the:it; and (7) Betty Waxl told John that her two good friends are gay. I. agreed .1 would look into

23 these allegations.

24 13. I went to the Apache J•nction Pizza Hut about. - two days. later to investigat. it

25 was difficult to know where to start since the ail:eaations were all over the map, but the first thing

26 I did was check to see if my phone number was posted in the restaurant, It was right on the

bulletin hoard, exactly, where I thought it was. I also did an audit of the tickets to see if any of

the tickets had been-thrown-out, but all the tickets were in perfect order. John had also made

Appendix of E\ idc ncL in 5UPPO1l ni i\4S I LAJ 641,0380.1 (Declarations of Thomas R. Kaufinzjn, Douglas Kreie and Bet-t -)? Caner)

secures counsel, at least 306() days will be required (br that counsel to learn enough about the

case to he ready to defend Rick Carter at trial should this action to that far. 6 To allow a chance

3 for Rick Carter to obtain and suta.hly prepare his own counsel before trial will require the Court

4 to continue the trial date at least ninety (90) days from the current August 5, 2003 date.

D

B. Additional Time is Needed to Find and Depose Ed Magedson

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Whether or not this Court allows Seyfarth Shaw , to withdraw as Rick. and Tim Carter's

eounsel, a continuance will still be required to allow Seyfarib Shaw a. reasonable opportunity to

8 locate and depose Ed Magedson. A continuance of the trial date is appropriate where a material

9 witness makes himself absent. Rule 38.1(1) of the Arizona Rules o.iCivil Procedure expressly

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1. 1 I provides that the need to secure testimony from a key witness can provide the basis for a

continuance of the trial. Ariz. R. Civ. ..P. 38.1(i).

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Here, the testimony of a material absent witness, Ed Magedson, is needed. Mr.

13 Magcdson was intimately involved in the filing of this lawsuit, Shortly after Plaintiff stopped

114 coming to work. Mr. Magedson spoke on the telephone with Doug Kreic Of Pizza Hut's parent

115 Corporation) on multiple occasions, pretending to be John Uncr's brother, Ed Uner. in the

16 second of these. conversations (which Mr. M agedson tape recorded), Mr. .Magedson threatened

17 that: if Pizza Hut did not pay John Unger blackmail money. Mr. Mageds.on would make

18 inflammatory allegations against Pizza Ihit in the news media. 1

19

Mr. Magedson did indeed publish false and defamatory in.tbrmatitiii about Pizza Hut on

20 his personal wèhsite, www.ripoffreport.com ,, and in various newspapers. in these publications,

M'. Magedson made a series of libelous statements including that Pizza hut was requiring its

22 Pizza. delivery drivers to ru.ndrugs on the job-- something even Plaintiff has admitted is untrue.

In the depoEitió:ns of third party witnesses that took place in Ma, Pizza Hut further learned that

dson t:ook out advertisements in the local media OI iciting druntled former Mr. Mage isg

employees to contact him to provide him any negative infô:nnation they had about Pizza Hut.

26 1 1Kauflan Dcc. 111 4 . KaLliman Dec. 118. Ex. B.

12 L)fcnci t111- \lotion to Wit L\\ afl (1 to ('out iuc I 1

A I J9i4.3

1 ivir. Mag.edson tape rccorded several interviews he conducted with these witnesses. Mr.

2 Mag.edson then directed both Plaintiff and the various former Pizza Hut employees to Plaintiff's

3 current counsel, Maria Speth,, to participate in the instant action and the related Louy lawsuit.

4

Since the outset of the action, Pizza Hut's own research into Mr. Ma.gedsoin's background

', has revealed that he is a con artist who has been involved in similar schemes against numerous

6 othu businesss ' Some of the details ol'Mr. Magdson s u\pknis are outlined in Llnbit F to

7 the Declaration of Thomas R. Kaufman. From the above, it is obvious that Mr. Magedson is a

8 crucial \\ in ess in this case, and Ins deposition is inipot taut to Pizza I Jut s dcicusc should this

9 action proceed to trial..

In March 2003, Ms. Speth agreed that she would produce Mr Magcdson for a.teleph,ni.c

depoitio.n (he reftied to appear in person) Shortly befôr current defise counsel made the trip

12 toAiizo.na for depositions, however, Ms. Speth called and stated that she could not produce Mr.

I .) Magedson and would be taking him off her witness list. ...supplemental disclosures that

141 Plaintiff has made since then, Mr. Magedson remains on Plaintiff's witness list. In any event,

15 moving defendants want Mr. Magcdson on their ovn witness list irrespective of whether Plaintiff

1. I calls him as a witness.

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Since Ms. Speth reneged on her initial agreemwt to produce Mr. M agedso.n for

deposition., dcfindants have tried zealously but have been un.successi:itl in subpoenaing Mr.

1.9 .Magcdson for a deposition.. De:1ènc1aits' investigators tried to serve Magedson with a subpoena

20 on several different occasions. Defendants have some leads on Mr. .Magedson's whereabouts but

2.1. believe they will need at least several weeks to locate and subpoena .Magedson. Unless the trial

date is postponed, Defendants will not have sn ificient, time to complete their discovery as to Mr.

.Mageds.on and will he unfairly prejudiced as a resat'

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I Kauthian Dec. 23.

I Kaufman Dec. ¶20. Ex. D. Kauthian .Doc. ¶19. Ex. C.

Kaufman Dec, ¶24.

13 Defendants' Motion to Withdraw and to Continue Trial

LA

SEYEA RTH 3

A T T 0 R N E Y S

Wr&s drect phone

010 .201-1501

WrjJrs e-mail

eshin(lasevfarth.com

One Century Pka

2029 C&nury Pi:i cost

Suite 3300 1

Los Anode-- CA 900673063

310 -2 7'72O0'

lox 3310-201-5-219

wwworth.com

June 25, 2003.

VIA.FACSTMJLE ANIU.S. MAIL (602) 258-6288

Maria Speth, Esq. Grant Williams, PC 3200 N. Central Ave.., Ste. 2400 Phoentc, AZ .012

Re: Unger v.. Pizza }ut. et1..

Dear Ms. Speth:

We recently became aware of amiinberof documents relevant .10 this action and that are in Plaintiffs possession, custoth or con1o1 Ihese documents include but are not limited to ernaris and other correspondence between Plaintiff John Unger and Ed Magedson, an agreement between Ed Magecison and Plaintiff John Unger in connection with settlement of this lawsuit, documents iciann& to Plaintiffs rceipt of SSI heietits documents relating to flai ltiflo- s efforts at obtaining other employment and benefits and Plaintiff's complete medical records To date vee have received none of these documents from your office.

Pursuant to Rule.26.1 of the Aiizona. Rules of civil Procedure and the document requests previoua.lysent. to you, Defendants ask that you produce (in addition to the aforementioned docunint) any and all documents relevant to this action immediately.

Thartk you in advance for yOur.anticipated courtesy and cooperation to this matter.

Very truly yours,.

SEYFARTH SHAW

Ellen J. Shin

EJS:ejs .--- cc: Adam Kunz, Esq. c

LA.) 6413547.1 "SCANNED"

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DECLARATION OF THOMAS R..KAUFM AN

1, Thomas R. Kaufman., declare as follows:

am an attorney at law licensed to practice law in California and am a partner

4 with the law firm of S.eyfarth Shaw, counsel of record for dfendants Pizza. Hut of Apache

5 Junction, Inc, Thompson .& BrOCIC Management, Jnc., Betty Carter, Micky Carter, Rick Carter,

6 Vanessa Carter, Tim Carter. Michelle Carter and Melissa Carter (collectively "Defendants"). I

/ am personally familiar with the matters herein and, if called, as a witness, I could and. would

8 competently testify thereto.

9

GOOD CAUSE EXISTS FOR THE PRODUCTION OF

I ()

RELEVANT DOCUMENTS IN PLAINTIFF'S POSSESSION

Ii 2; Investigation and discovery has revealed that Ed. Magedson, Plaintiffs neighbor

12 and a self-proclaimed "consiwier advocate" (hut not an attorney) assisted Plaintiff with the filing

3 of this lawsuit. Mr. Magedson, inter cilia, assisted by tape recording interviews with several

14 witnesses about Plaintiffs claims. 1 reviewed the transcriptions of these interviews. I also

15 discovered that Mr. Magedson directed both Plaintiff and the various Pizza Hut employees to

16 Plaintiffs current counsel. Maria. Speth, to participate in the. instant action and the related Louy,

17 el al. v. Pizza Rut of Apache Junction, Inc, et at lawsuit.

18

3. On March 28, 2001., Plaintiff filed. this lawsuit against Pizza Hut olApache

1:9 Junction, Inc. ("Pizza Hut"). Thompson & Broci Management, i±icon Restaurant. Services

20 Group, and various employees of Pizza Hut. Plaintiffs Complaint alleges six purported causes

21. of action: (1) intentional infliction' of emotional distress, (2) constrUctive discharge, (3) wrongfn}

22 tci inrnation in violation of public policy (4) negligent supc1' so i (5) Invasion ofpni icy and

23 (6) thilure to pay wages. Thereafter all the Defendants answered and filed a counterclaim against

24 Plaintiff Thi defamation.

2 4. Based upon my review of the file, I saw that both parties had served their Rule

26 26. 1 disclosures, which disclosed infom -ia.tion.and documents relevant to the subject matter of

this ease. rn June of 2002.

5.Defendants also propounded requests for production of documents and requests

DECLARATION OF fl'tOMAS R. KAUFMAN IN SUPPORT OF .D' IThJDANTS MOTION TO COMPEL

° 64 1 8,90S. I

DOCTWINTS AD REOUh'1 FOR SANCTIONS

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I for production of documents in connection with Plaintiff's Notice of Deposition, but received

H verv few documents.

6. On May 20-21, .2003, 1 took. the deposition of Plaintiff in; Phoenix, Arizona

During the deposition, Plaintiff testified that he had suffered head trauma and extensive, injuries

in 1982. Ho could not, however, testify as to the names and address of all the doctors he had

seen since his injury except for Dr. Kathryn Hart and Dr. .Lecavaher. Plaintiff also testified that

Plaintiff had applied and received social security benefits following his departure from Pizza

Hut. Plaintiff could not, however, testify as to the amount of those benefits., when they

commenced, or on what basis he was found disabled.

7. Following Plaintiff's deposition, Defendants subpoenaed the records of Dr.

Kathryn Hart and Dr. Lecavalier to inquire about Plaintiff's alleged damages and to Wells Fargo

Bank to inquire about any social security payments or any other benefit payments received by

Plaintiff

8. On June 20, 2003,. my office received documents from Dr. Kathryn Hart in

response to Defendants' deposition subpoena. Ellen I. Shin, an associate in my office, and I

rviewcd those documents and discovered that Plaintiff had not complied with his continuing

duty to produce relevant documents under Rule 26.1 and in response to Defcndants previous

requests for production of documents. Specifically, we learned that Plaintiff possessd the

following documents and infomation:

Emails and other comrrumc itions between Plaintiff and Ed Magcdon (or alternatively, Plaintiff's computer .hard d diive hich wouldcontain the sub jed C-

mails).; An agreement betv eon [d Magodson and Plaintiff in connection ith settlement of this lawsuit;

Plaintiff's apphcation and receipt of 'social security benefits;

Conespuncicnce notes, memos €tc relating to J'laintiffs ctfoits at ohtalnlnb other employment and benefits;

That Plaintiff 'had been seeing other doctors ho ho had not identified at his deposition and the 'records from whom he had never produced; and

That Plaintiff had Mr. 4.agedons telephone, number in his possession, not\lthstandt% that Plaintiff denied kno mg the telephone numbet or ev en being in contact with Mr. Magedson when he was asked about it at his deposition.

3 DFCL'\i flQ 11 1OM\.S R F..AUFM "s IN SUPPOR r OF DL'TDA1TS' MOTION ION TO CO\'iPEI

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I never responded to Defendants' request.

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14. On July 21-22 2003, .1 traveled to Phoenix, Arizona to defend the depoition of

Officer Kridler and to take the deposition of Dr. Kathryn Hart. Plaintiff was present throughout

4 both depositions. During one of the breaks at Officer Kridler's deposition, I asked Plaintiff's

counsel, Maria Speth, about the status of the various documents that Pl.aintff possessed hut had

not produced, specifically the emails between Plaintiff and Mr. Magedson. Plaintiff;, who was.

sitting across the table, immediately blurted out that he was not going to turn over any of his e-

mails because they were"'none of [Pizza lint s] business."' Ms Speth then called Plaintiff

outside to talk to him and when she returned she claimed-- for the first time ever-- that Plaintiff

could not produce the c-mails because they had been lost when his hard. drive crashed. I

expressed to Ms. Speth that I was disappointed she would say that when it was clear from

Plaintiff's outburst: two. minutes before that he simply Was refusing to produce them because he

I did not want to do so. I further informed Ms. Speth that I was going to move to compel

production

of the c-mails and/or the computer hard dilve. Ms. Speth said she would oppose any

such motion.

16. The next day, at Dr. Hatt's deposition, Dr. Hart testified that Plaintiff had applied

and received social security benefits because she herself had assisted with. Plaintiff s social

security application and he also later informed her of hi-s receipt of those benefits. She also

testified that at least one sourceo fP .lainhiff ssource of mental anguish was from a series of

volatile communications between, Plaintiff and Mr. Magedson. Apparently Mr. Magedson was

harassing Plaintiff about his portion of the potential settlement from the outcome of the lawsuit.

Attached hereto as Exhibit C is a true and conect copy of the relevant portions from Di Bait -

records,

17. in her deposition s Dr. Hart further testified and confirmed that Plaintiff had told

her that he had been in telephone contact with Ed Magedson within the last few weeks. When I

noted to Ms. Speth that Plain tiff had testified under oath just a few weeks before that he did not

know Mr. Magedson's phone number, she told me that Plaintiff had only communicated with

Mr. Magedson by e-mail. That was flatly contrary to what Dr. Hart, Plaintiff's own treating

DECLARATION OF THOMAS R. KAUFMAN IN SUPPORT OF DEFENDANTS MOTION TO COMPEL LAJ 41890.I nr)nhTMnwTs ANT) RWi IFJ FOR SANCTIoNS