Willis Carto archive

Including information about his associates

Legion v Carto, Trial transcript, Volume 1


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page 1
 
 
 
 1           COURT OF APPEAL OF THE STATE OF CALIFORNIA
 
 2                    FOURTH APPELLATE DISTRICT
 
 3                          DIVISION ONE
 
 4  ______________________________
                                  )
 5  LEGION FOR THE SURVIVAL OF    )
    FREEDOM, INC.,                )    DCA. NO. DO27959
 6                                )
                   PLAINTIFF AND  )    FROM SAN DIEGO COUNTY
 7                 RESPONDENT,    )
                                  )    HON. RUNSTON G. MAINO
 8       VS.                      )
                                  )    OPENING STATEMENTS
 9  WILLIS CARTO, HENRY FISCHER,  )
    VIBET, INC., LIBERTY LOBBY,   )    TRIAL PROCEEDINGS
10  INC., ET. AL.,                )
                                  )
11                 DEFENDANTS AND )
                   APPELLANTS.    )
12  ______________________________)
 
13
                     REPORTER’s APPEAL TRANSCRIPT
14
                         OCTOBER 28-29, 1996
15                        OCTOBER 31, 1996
 
16                            VOLUME 1
 
17                           PAGES 1-158
 
18
 
19  APPEARANCES:
 
20       FOR THE PLAINTIFF AND    JACQUES BEUGELMANS AND
         RESPONDENT:              THOMAS MUSSELMAN
21                                1901 AVENUE OF THE STARS
                                  CENTURY CITY, CA 90067
22
         FOR THE DEFENDANTS AND   PETER J. PFUND
23       APPELLANTS:              2382 S.E. BRISTOL
                                  SUITE A
24                                NEWPORT BEACH, CA 92660
 
25
 
26
                                  BARBARA J. SCHULTZ, CSR, RPR
27                                CSR NO. 8021
                                  OFFICIAL REPORTER
28                                VISTA, CALIFORNIA
			
			

page  2
 
 
 
 1        IN THE SUPERIOR COURT OF THE STATE OF CALIFORNIA
 
 2                IN AND FOR THE COUNTY OF SAN DIEGO
 
 3  DEPARTMENT 11                    HON. RUNSTON G. MAINO
 
 4
    _____________________________
 5                               )
    LEGION FOR THE SURVIVAL OF   )
 6  FREEDOM, INC.,               )
                                 )
 7                  PLAINTIFF,   )           NO. N64584
                                 )
 8           VS.                 )
                                 )
 9  WILLIS CARTO, HENRY FISCHER, )
    VIBET, INC., LIBERTY LOBBY   )
10  INC., ET. AL.,               )
                                 )
11              DEFENDANTS.      )
    _____________________________)
12
 
13                       REPORTER’s TRANSCRIPT
 
14                       OCTOBER 28-29, 1996
                          OCTOBER 31, 1996
15
    APPEARANCES:
16
        FOR THE PLAINTIFF:       JACQUES BEUGELMANS AND
17                               THOMAS MUSSELMAN
                                 1901 AVENUE OF THE STARS
18                               CENTURY CITY, CA 90067
 
19
 
20      FOR THE DEFENDANTS:      WAIER AND URTNOWSKI
                                 BY:  RANDALL S. WAIER
21                               1301 DOVE STREET
                                 NEWPORT BEACH, CA 92660
22
 
23
        FOR THE DEFENDANT        MARK LANE
24      LIBERTY LOBBY, INC.:     300 INDEPENDENCE AVENUE, S.E.
                                 WASHINGTON, D.C. 20003
25
 
26
                                 BARBARA J. SCHULTZ, CSR, RPR
27                               CSR NO. 8021
                                 OFFICIAL REPORTER
28                               VISTA, CALIFORNIA
			
			

page  3
 
 
 
 1  VISTA, CALIFORNIA, OCTOBER 28-29, 1996, DEPT. 11:
 
 2
 
 3            (I, BARBARA J. SCHULTZ, DECLARE THAT MY NOTES
 
 4            REFLECT AND THE COURT MINUTES CORROBORATE THAT
 
 5            THERE WERE NO REPORTED PROCEEDINGS ON OCTOBER 28
 
 6            AND OCTOBER 29, 1996.)
 
 7
 
 8
 
 9
 
10
 
11
 
12
 
13
 
14
 
15
 
16
 
17
 
18
 
19
 
20
 
21
 
22
 
23
 
24
 
25
 
26
 
27
 
28
			
			

page  4
 
 
 
 1  VISTA, CALIFORNIA, OCTOBER 31, 1996, DEPARTMENT 11:
 
 2
 
 3       THE COURT:  ON THE RECORD IN THE — THE LEGION VERSUS
 
 4  MR. WILLIS CARTO, ET AL.  I DON'T HAVE THE FILE.  GET THE
 
 5  APPEARANCE, AND GO THIS WAY.
 
 6       MR. BEUGELMANS:  JACQUES BEUGELMANS AND THOMAS
 
 7  MUSSELMAN FOR THE PLAINTIFF.
 
 8       MR. WAIER:  RANDALL WAIER AND BRIAN URTNOWSKI, NOT
 
 9  PRESENT, REPRESENTING ALL OF THE DEFENDANTS EXCEPT LIBERTY
 
10  LOBBY.  AND HE'LL BE MARK LANE FROM WASHINGTON, D.C.  WILLIS
 
11  CARTO IS ONE OF THE DEFENDANTS IN THIS ACTION ON MY LEFT.
 
12       THE COURT:  I UNDERSTAND YOU HAVE THE AUTHORITY ON
 
13  BEHALF OF ALL THE DEFENDANTS TO WAIVE JURY AND YOU ARE DOING
 
14  THAT; IS THAT RIGHT?
 
15       MR. WAIER:  YES, I WAS COMMUNICATED THAT ON 2 DAYS AGO,
 
16  I BELIEVE TUESDAY.  I HAVE MY CLIENT HERE.  AND JUST SO WE
 
17  CAN PUT IT ON THE RECORD, I HAVE BEEN REPRESENTED BY
 
18  MR. CARTO THAT A JURY WOULD BE WAIVED.
 
19            IS THIS YOUR DECISION?
 
20       MR. CARTO:  YES.  I ASKED MR. WAIER TO WAIVE THE JURY.
 
21       THE COURT:  AND HOW ABOUT THE PLAINTIFF?
 
22       MR. BEUGELMANS:  YES, WAIVED.
 
23       THE COURT:  AS FAR AS THE REPORTER IS CONCERNED, I
 
24  UNDERSTAND THE DEFENSE WOULD LIKE IT REPORTED.  SO THAT WILL
 
25  BE YOUR FEE TO PICK UP.  IF YOU ARE THE PREVAILING PARTY, IT
 
26  WILL BE A COST TO THEM.
 
27       MR. WAIER:  CORRECT.
 
28       THE COURT:  IF THEY — IF THEY WISH TO GET A RECORD ON
			
			

page  5
 
 
 
 1  APPEAL, YOU ARE GOING TO HAVE TO PAY FULL COST.
 
 2       MR. BEUGELMANS:  OF COURSE.  UNDERSTOOD.
 
 3       THE COURT:  GO OFF THE RECORD AND HAVE THE JURORS COME
 
 4  IN.
 
 5           (THE COURT EXCUSED THE PROSPECTIVE JURORS.)
 
 6       THE COURT: ON THE RECORD THEN.  WOULD THE PLAINTIFF
 
 7  LIKE TO MAKE AN OPENING STATEMENT?
 
 8       MR. BEUGELMANS:  YES.
 
 9       MR. MUSSELMAN:  YOUR HONOR, I THOUGHT IF I WOULD MAYBE
 
10  RUN THROUGH AN OVERVIEW AND GO INTO THINGS IN MORE DETAIL
 
11  SENSE SO IT WILL MAKE SENSE.
 
12            THIS CASE IS ABOUT A MASSIVE MULTIMILLION DOLLAR
 
13  HEIST, A HEIST THAT DIDN'T INVOLVE MASKED MEN, BUT IS JUST
 
14  AS EFFECTIVE AS IF IT WOULD HAVE BEEN A HEIST OF ASSETS THAT
 
15  BELONGED TO THE PLAINTIFF AND NONPROFIT CORPORATION.
 
16       MR. WAIER:  YOUR HONOR, I'M GOING TO OBJECT AT THIS
 
17  POINT.  IF HE WOULD LIKE TO MAKE A CLOSING ARGUMENT, THAT'S
 
18  OKAY.  THIS IS AN OPENING STATEMENT AND SHOULD BE RESTRICTED
 
19  TO THE FACTS.  I NORMALLY DON'T USE THAT.  WHEN HE USES THE
 
20  TERMS “HEIST” AND “A MASSIVE HEIST” AND THINGS, THAT'S
 
21  INAPPROPRIATE FOR AN OPENING STATEMENT.
 
22       THE COURT:  OKAY.  I AGREE WITH YOU.  YOU CAN MAKE A
 
23  BRIEFER OBJECTION.  IT’s ARGUMENTATIVE.  TELL ME — I KNOW
 
24  THAT YOU MAYBE PREPARED IT FOR THE JURY AND I WOULD HAVE
 
25  SUSTAINED THE OBJECTION IN FRONT OF THE — OF THE JURY.
 
26  TELL ME WHAT YOU THINK THE ISSUES ARE, WHAT THE WITNESSES
 
27  ARE, AND WHAT YOU WILL CALL IT, RATHER THAN USING THE
 
28  PEJORATIVE WORDS LIKE “HEIST."
			
			

page  6
 
 
 
 1       MR. MUSSELMAN:  I'LL STICK TO LEGAL TERMS LIKE
 
 2  “CONVERSION.”  IT’s A CONVERSION FROM THE PLAINTIFF.  AS OF
 
 3  JUNE OF '91, WE KNOW AS AN EXCESS OF 7.1 MILLION DOLLARS
 
 4  THAT WAS CONVERTED, CONVERTED BY A TRUST OF FIDUCIARY THAT
 
 5  WOULD BE ENTRUSTED WITH THE TASK OF GOING TO SECURE THE
 
 6  ASSETS FOR THE PLAINTIFF.  THAT IS DEFENDANT WILLIS CARTO.
 
 7            THE EVIDENCE WILL SHOW THAT THE CONVERSION, THE
 
 8  BREACH OF TRUST, THE BREACH OF FIDUCIARY DUTY, THE FAILURE
 
 9  TO ACCOUNT FOR HOW MUCH WAS TAKEN AND WHERE IT IS RIGHT NOW,
 
10  INCLUDING THE PROCEEDS, CONTINUES RIGHT TO THE VERY
 
11  PRESENT.  IT INVOLVES, THE EVIDENCE WILL SHOW, CONSPIRACY
 
12  AMONG THE DEFENDANTS, SUCH AS DEFENDANT MR. CARTO, WHO NOW
 
13  PURPORTS TO BE THE PLAINTIFF’s PRESIDENT.  AND IF HE
 
14  TESTIFIES CONSISTENTLY WITH WHAT HE STATED IN THE PAST, HE
 
15  HAS THE PLAINTIFF’s RECORDS CONCERNING THE ASSETS THAT
 
16  PLAINTIFF ALLEGES WERE CONVERTED.
 
17            IT ALSO WILL DEMONSTRATE HIS WIFE WAS PART OF THE
 
18  CONSPIRACY WHO, TOGETHER WITH LEWIS AND LAVONNE FURR, THE
 
19  DEFENDANT, ARE PURPORTING TO CONDUCT THE BUSINESS OF THE
 
20  PLAINTIFF EVEN NOW AS THE SUPPOSED BOARD AND HAD MEETINGS IN
 
21  1994 AND 1995 DESPITE THE FACT THE EVIDENCE WILL SHOW
 
22  THEY'RE NOT DIRECTORS.
 
23            THE EVIDENCE WILL ALSO SHOW THAT DEFENDANT LAVONNE
 
24  FURR, TOGETHER WITH MRS. CARTO, OPENED A BANK ACCOUNT SINCE
 
25  THE SUIT WAS FILED IN THE NAME OF THE PLAINTIFF AND HAS
 
26  RECEIVED DONATIONS, SO WE ARE UNABLE TO SHOW PRECISELY HOW
 
27  MUCH HAS BEEN CONVERSION.  CONVERSION IS NOW GOING ON AND NO
 
28  ACCOUNTING HAS BEEN PROVIDED.
			
			

page  7
 
 
 
 1       MR. WAIER:  I OBJECT TO THE LATTER OPENING STATEMENT.
 
 2  THOSE ARE NOT ISSUES RAISED IN THE LITIGATION.  THE ONLY
 
 3  ISSUES ARE THOSE INVOLVING THE JEAN FARREL ESTATE.
 
 4       MR. MUSSELMAN:  THAT’s NOT TRUE.
 
 5       THE COURT:  OVERRULED.
 
 6       MR. MUSSELMAN:  THE EVIDENCE WILL SO SHOW THAT THE
 
 7  CONSPIRACY INVOLVES THE DEFENDANT LEWIS AND LAVONNE FURR,
 
 8  ARE AN ARKANSAS RESIDING COUPLE WHO MR. FURR DESCRIBED AS
 
 9  HAVING — HAVING BEEN MR. Carto’s PUPPET BOARD MEMBERS AND
 
10  THAT THEY WERE PUPPET BOARD MEMBERS SO MR. CARTO COULD DO
 
11  WHAT THEY WANTED WITH THE PLAINTIFF.  ALSO IF HE TESTIFIES
 
12  CONSISTENTLY WITH WHAT HE STATED IN THE PAST, THE EVIDENCE
 
13  WILL DEMONSTRATE MR. CARTO HAS BELIEVED THAT CONSULTING WITH
 
14  THE BOARD OF DIRECTORS OF THE PLAINTIFF WAS A WASTE OF
 
15  TIME.  AND HE’s ADMITTED THAT MEETINGS HAVE OCCURRED WITHOUT
 
16  A MAJORITY OF THE DIRECTORS BEING PRESENT.
 
17            DESPITE THE END OF THEIR AFFILIATION WITH THE
 
18  PLAINTIFF BACK IN THE FALL OF '93, THE — MR. AND
 
19  MRS. CARTO AND MR. AND MRS. FURR HAVE CONTINUED TO MAKE
 
20  DEMANDS FOR A TURNOVER OF ALL THE PLAINTIFF’s RECORDS AND
 
21  ASSETS AND CONTINUE TO HOLD THEMSELVES OUT TO BE — TO BE
 
22  SOLELY AND LEGALLY IN CONTROL OF THE PLAINTIFF, THUS
 
23  INTERFERING WITH PLAINTIFF’s ACTIVITIES.
 
24            THE EVIDENCE WILL DEMONSTRATE THAT THE CONSPIRACY
 
25  INVOLVES LIBERTY LOBBY IN WASHINGTON, D.C., OF WHICH
 
26  MR. CARTO IS DIRECTOR AND FOR WHICH HE’s BEEN A TREASURER
 
27  FOR MANY YEARS.  THE EVIDENCE WILL DEMONSTRATE THEY CAUSED
 
28  THE TRANSFER OF THE CONVERTED ASSETS OF AT LEAST 2.75
			
			

page  8
 
 
 
 1  MILLION DOLLARS TO OCCUR TO LIBERTY LOBBY, OF WHICH HE'S
 
 2  TREASURER, AND A TRANSFER OF AT LEAST ANOTHER $750,000 TO AN
 
 3  ENTITY CALLED FOUNDATION TO DEFEND THE FIRST AMENDMENT,
 
 4  WHICH ACTUALLY HAS NO EMPLOYEES AND USES LIBERTY LOBBY'S
 
 5  ADDRESS.
 
 6            THE EVIDENCE WILL DEMONSTRATE THAT THE CONSPIRACY
 
 7  INVOLVES AN ENTITY, VIBET, V-I-B-E-T, WHOSE DEFAULT HAS BEEN
 
 8  TAKEN AND THAT VIBET WAS FORMED AT MR. Carto’s REQUEST BY A
 
 9  SWISS LAWYER, PATRICK FOETISCH, F-O-E-T-I-S-C-H, TO LIFT THE
 
10  CONVERTED ASSETS AND THEN TO DISTRIBUTE THEM ONWARD TO
 
11  LIBERTY LOBBY, FOUNDATION TO DEFEND THE FIRST AMENDMENT, AND
 
12  OTHER ENTITIES THAT HAVE NOT BEEN IDENTIFIED BY ANY
 
13  ACCOUNTING.
 
14            CONSPIRACY ALSO INVOLVED THE ASSISTANCE OF
 
15  DEFENDANT HENRY FISCHER, FRIENDS OF MR. AND MRS. CARTO, AN
 
16  ACCOMPLICE WHOSE SIGNATORY POWER — HE WAS GIVEN SIGNATORY
 
17  POWER OVER THE ACCOUNT WHERE THE DISTRIBUTION OF THE ASSETS
 
18  OCCURRED.
 
19            THE EVIDENCE WILL DEMONSTRATE THAT THE MONEY AT
 
20  ISSUE WAS GIFTED TO THE PLAINTIFF BY A WEALTHY WOMAN NAMED
 
21  JEAN FARREL AND THAT, THEREAFTER, THE PLAINTIFF NEVER SOLD
 
22  THE ASSETS TO MR. CARTO.  IT NEVER GIFTED THE ASSETS TO
 
23  MR. CARTO.  IT NEVER ABANDONED THE ASSETS TO MR. CARTO.  IT
 
24  NEVER GAVE HIM THE POWER TO DISPOSE OF THE ASSETS.  AND THE
 
25  ASSETS CONSTITUTED 95 PERCENT OR MORE OF THE ASSETS OF THE
 
26  PLAINTIFF.  THAT IS SUBSTANTIALLY ALL THE ASSETS OF THE
 
27  PLAINTIFF.  THERE WAS NEVER NOTICE GIVEN TO THE DIRECTORS OF
 
28  ANY SUCH DISPOSITION.
			
			

page  9
 
 
 
 1            THERE WAS NEVER A MEETING HELD WHETHER FORMALLY OR
 
 2  INFORMALLY BY THE DIRECTORS TO APPROVE ANY SUCH DISPOSITION;
 
 3  THAT FRAUDULENT MINUTES WERE CREATED AFTER THE FACT RECITING
 
 4  MEETINGS THAT NEVER DID OCCUR, STATING THE PEOPLE WERE
 
 5  PRESENT WHO WEREN'T PRESENT, INCLUDING BY CONFERENCE CALL,
 
 6  AND NOWHERE WAS CONSENT APPROVED AFTER THE FACT EITHER BY
 
 7  THE DIRECTORS.
 
 8            THE EVIDENCE WILL DEMONSTRATE THERE WAS NEVER A
 
 9  TRANSFER TO PLAINTIFF OF ANYTHING OF EQUAL VALUE TO ACCOUNT
 
10  FOR THE CONVERTED ASSETS, THE 7.1 MILLION PLUS INTEREST PLUS
 
11  AN UNKNOWN ADDITIONAL AMOUNT OF ASSETS.
 
12            MOST OF THE EVIDENCE WILL COME FROM THE
 
13  DEFENDANTS' OWN WORDS AND THEIR OWN WRITINGS.  THEY'LL
 
14  DEMONSTRATE THAT REPEATEDLY OVER A COURSE OF YEARS,
 
15  MR. CARTO LED THE PLAINTIFF AND OTHERS TO BELIEVE THAT THE
 
16  ASSETS THAT HAD BEEN LEFT TO THE PLAINTIFF WERE STILL OWNED
 
17  BY PLAINTIFF AND THAT PLAINTIFF WAS STILL EXERCISING CONTROL
 
18  OVER THEM AND THEY WERE IN PLAINTIFF’s CONTROL AND WAS
 
19  ENTITLED TO THE FULL BENEFIT OF THEM.
 
20            THE EVIDENCE WILL ALSO DEMONSTRATE MR. CARTO NEVER
 
21  INFORMED THE PLAINTIFF’s BOARD OF DIRECTORS HOW MUCH MONEY
 
22  THE ASSETS WERE, NOR DID HE PROVIDE AN ACCOUNTING, NOR
 
23  PROVIDE THE DOCUMENTS TO DEMONSTRATE WHERE THE MONEY IS, HOW
 
24  IT WAS SPENT, WHAT BANK ACCOUNTS IT WAS DEPOSITED TO, WHO
 
25  HAS THE MONEY RIGHT NOW.  MONEY, THE ASSETS, ALSO INCLUDED
 
26  GEMS.  THERE’s BEEN NO ACCOUNTING FOR THE AMOUNT OF THE GEMS
 
27  AND WHERE THEY ARE.
 
28            THE EVIDENCE WILL FURTHER DEMONSTRATE THAT THE
			
			

page  10
 
 
 
 1  PLAINTIFF HAD SUFFICIENT ASSETS TO HIRE A LAWYER AND TO PAY
 
 2  THE ONLY FEES THAT WERE INCURRED TO PROSECUTE THE LITIGATION
 
 3  THAT WAS A RESULT OF THE CONVERSION OF THE ASSETS, AND ALSO
 
 4  IF HE TESTIFIES CONSISTENTLY WITH WHAT THEY STATED BEFORE,
 
 5  THE PLAINTIFF BORROWED MONEY AS NEEDED TO PROSECUTE THE
 
 6  LITIGATION, SO IT HAD THE ABILITY TO BORROW MONEY.  THAT THE
 
 7  EVIDENCE WILL SHOW THAT THE FINAL LEGAL BILL WAS PRIMARILY
 
 8  PAID OUT OF THE PROCEEDS OF THE LITIGATION ITSELF.
 
 9            IN ADDITION, THE EVIDENCE WILL SHOW THAT THE
 
10  PLAINTIFF NEVER GAVE 20 DAYS' ADVANCE WRITTEN NOTICE TO THE
 
11  CALIFORNIA ATTORNEY GENERAL’s OFFICE OF THE PURPORTED
 
12  TRANSFER, AS WOULD HAVE BEEN REQUIRED SINCE PLAINTIFF HAS
 
13  ITS PRINCIPAL PLACE OF BUSINESS IN CALIFORNIA, AND THE
 
14  ASSETS IN QUESTION WERE SUBSTANTIALLY ALL OF HIS ASSETS,
 
15  ALTHOUGH NOT ALL.
 
16            SOMETIMES THE PLAINTIFF IS REFERRED TO AS THE
 
17  LEGION OR L.S.F.  YOU WILL SEE REFERENCE TO IT, TO A
 
18  PUBLICATION THAT IS THE INSTITUTE FOR HISTORICAL REVIEW OR
 
19  I.H.R.  THOSE ARE INTERCHANGEABLE TERMS FOR THE PLAINTIFF
 
20  AND MOST COMMONLY REFERRED TO AS THE LEGION.  IT WAS FORMED
 
21  IN 1952 OUT OF STATE BUT HAD THE OFFICE IN CALIFORNIA FOR
 
22  YEARS IN THE COSTA MESA AREA.  IT HAD 2 SETS OF BYLAWS.  ONE
 
23  SET IS UNDATED.  SECOND SET IS DATED FROM JUNE 1966.
 
24            THE EVIDENCE WILL DEMONSTRATE THAT THE SECOND SET
 
25  WAS DRAFTED BY MR. CARTO AND THAT THAT SECOND SET ONLY
 
26  ALLOWS BOARD OF DIRECTOR MEETINGS TO OCCUR BY TELEPHONE IF
 
27  ACTION IS REDUCED TO WRITING AND APPROVED BY A MAJORITY
 
28  THEREAFTER.  THE EVIDENCE WILL DEMONSTRATE THAT NEVER
			
			

page  11
 
 
 
 1  OCCURRED HERE.  THE EVIDENCE WILL ALSO DEMONSTRATE THAT
 
 2  DIRECTORS WERE REELECTED UNLESS THEY SAID SOMETHING TO THE
 
 3  CONTRARY YEAR AFTER YEAR.  THE PLAINTIFF LATER MERGED WITH
 
 4  ANOTHER ENTITY IN A DOCUMENT THAT RECITES THAT THE
 
 5  ORGANIZATION IS A NONMEMBER, PUBLIC-BENEFIT CORPORATION.
 
 6            THE PRINCIPAL ISSUE THAT INVOLVED MISS JEAN FARREL
 
 7  AND STARTED IN APPROXIMATELY 1990, THE — PRIOR TO THAT,
 
 8  THE ONLY TIME THAT MR. CARTO MET MISS FARREL WAS 1984 WHEN
 
 9  SHE INDICATED TO HIM SHE WOULD BE LEAVING MONEY TO THE
 
10  PLAINTIFF.  MARCH 1985 MINUTES OF THE CORPORATION WILL SHOW
 
11  THAT MISS FARREL HAD FOUNDED A CORPORATION, NECA, N-E-C-A,
 
12  WHICH SHE CREATED FOR THE PLAINTIFF, WHICH WAS TO COME INTO
 
13  THE PLAINTIFF’s CONTROL UPON HER DEATH AND THAT ENTITY WAS
 
14  TO RECEIVE HER ASSETS.
 
15            MISS FARREL DIED IN SWITZERLAND AUGUST 11, 1985.
 
16  THE CORPORATE MINUTES WILL REFLECT THE SIGNIFICANCE OF HER
 
17  DEATH WAS A DIRECT CONTROL OF THE COMPANY HOLDING THE ASSETS
 
18  PASSED TO THE PLAINTIFF.
 
19            THERE’s A DOCUMENT DATED SEPTEMBER 7, 1985, SIGNED
 
20  BY MRS. FURR AND THOMAS MARCELLUS THAT RECITES THAT THOMAS
 
21  MARCELLUS WAS THE DIRECTOR.  THE EVIDENCE WILL DEMONSTRATE
 
22  HE NEVER PARTICIPATED IN ANY MEETING, NOR WAS ASKED TO --
 
23  TO GIVE THESE ASSETS TO MR. CARTO OR ALLOW MR. CARTO TO DO
 
24  WITH THEM AS HE SAW FIT.
 
25            IT’s ANTICIPATED THAT THE DEFENDANTS MAY TRY TO
 
26  INTRODUCE INTO EVIDENCE A HEARSAY DOCUMENT, A LETTER DRAFTED
 
27  BY MR. CARTO ADDRESSED TO DEFENDANT LAVONNE FURR WHERE HE
 
28  STATES HE WISHES HE HAD THE POWER TO DISTRIBUTE THE ASSETS
			
			

page  12
 
 
 
 1  AS HE SEES FIT.  THERE IS NO BOARD MEETING EVER GRANTING HIM
 
 2  AUTHORITY.  THERE ARE MINUTES OF THE MEETING SEPTEMBER 19,
 
 3  1985, FEW DAYS AFTER THAT LETTER, STATING THAT MR. CARTO
 
 4  MADE A REPORT AS BUSINESS AGENT FOR THE PLAINTIFF AND THAT
 
 5  RELATIVES OF JEAN FARREL WERE CONTESTING OWNERSHIP OF THE
 
 6  ASSETS, EVEN THOUGH THEY WERE NOT PART OF JEAN FARREL'S
 
 7  ESTATE AS A RESULT OF JEAN FARREL ALREADY HAVING GIFTED THE
 
 8  ASSETS TO NECA, SEEKING RESOLUTIONS TO GIVE MR. CARTO AND
 
 9  DEFENDANT HENRY FISCHER ONE YEAR POWER OF ATTORNEY TO SECURE
 
10  THE PROPERTY OF THE PLAINTIFF, NAMELY NECA CORPORATION.
 
11            AS THE EVIDENCE WILL DEMONSTRATE, AS OF THAT POINT
 
12  IN TIME THERE HAD BEEN NO DISPOSITION TO IN MR. Carto’s
 
13  POWER FOR OWNERSHIP OF THE ASSETS.
 
14            THE EVIDENCE WILL FURTHER DEMONSTRATE MR. CARTO,
 
15  AS OF THAT SEPTEMBER 20TH POWER OF ATTORNEY, HAD NOT
 
16  DISCUSSED WITH THE DIRECTORS THE AMOUNT OF THE ASSETS.  THUS
 
17  THERE HAD BEEN NO DISCLOSURE THAT WOULD HAVE ALLOWED
 
18  DISPOSITION TO HIM OR AN ABANDONMENT TO HIM.
 
19            IN MARCH '86, THERE WAS ANOTHER BOARD MEETING.
 
20  AND AGAIN, THE MINUTES RECITE EFFORTS WERE MADE BY THE
 
21  PLAINTIFF TO RECOVER THE PROPERTY OF THE PLAINTIFF AND THAT
 
22  EXPENDITURES WERE CONTINUING DEFINITELY TO DO SO.  THE
 
23  MINUTES RECITE THERE WERE SIX DIRECTORS, INCLUDING MR. AND
 
24  MRS. FURR.  THUS, MR. AND MRS. FURR COULD NOT CONSTITUTE A
 
25  MAJORITY OF THE DIRECTORS.  NOW, LIKEWISE, TRUE FOR MARCH
 
26  1985, THERE WERE FIVE DIRECTORS.  MR. AND MRS. FURR COULD
 
27  NOT CONSTITUTE A MAJORITY OF THE DIRECTORS AT THAT TIME
 
28
			
			

page  13
 
 
 
 1  EITHER, ACCORDING TO THE MINUTES.
 
 2            THEN IN MAY OF 1986, MR. CARTO SIGNED A VERIFIED
 
 3  COMPLAINT THAT WAS FILED IN NORTH CAROLINA, FILED BY THE
 
 4  PLAINTIFF LEGION, AGAINST A BANK AND JOAN ALTHAUS, THE
 
 5  PERSON WHO WAS CONTESTING THE GIFT TO THE LEGION BY MISS
 
 6  JEAN FARREL.  THAT COMPLAINT STATES THAT PLAINTIFF AGAIN
 
 7  OWNED NECA AND THAT NECA WAS FORMED BY JEAN FARREL AND HAD
 
 8  ASSETS IN EXCESS OF 16 MILLION DOLLARS AROUND THE WORLD
 
 9  COMPOSED OF BEARER CERTIFICATES GIFTED TO THE PLAINTIFF BY
 
10  JEAN FARREL WHILE SHE WAS ALIVE AND THE CERTIFICATES WERE
 
11  STILL PLAINTIFF’s PROPERTY, AND THAT THE — THE
 
12  CERTIFICATES WERE IN SAFE DEPOSIT BOXES BY AN AGREEMENT
 
13  BETWEEN JEAN FARREL AND WILLIS CARTO AS AGENT FOR THE
 
14  PLAINTIFF.
 
15            ALSO, ANSWERS TO INTERROGATORIES IN THAT CASE
 
16  SIGNED BY MR. CARTO AGAIN STATING THE IDENTICAL THING.
 
17  MR. CARTO HAD DISCUSSED THE PURPOSE OF NECA, WHICH WAS TO
 
18  TRANSFER FARREL’s ASSETS TO THE PLAINTIFF, AND THAT KEYS TO
 
19  THE SAFETY DEPOSIT BOXES WERE DELIVERED TO MR. CARTO FOR THE
 
20  PLAINTIFF.
 
21            1986, MARCH OF '87, THERE WAS ANOTHER MINUTES OF
 
22  THE BOARD OF DIRECTORS MEETING PREPARED BY — THE MINUTES
 
23  WERE PREPARED BY MR. CARTO.  AND THEY RECITE THAT A
 
24  SETTLEMENT OF THE LITIGATION IN SWITZERLAND AND OTHER PLACES
 
25  WOULD SOON BE REACHED AND WOULD DEPEND UPON THE LEGION
 
26  RELINQUISHING CLAIM ON A SIZEABLE PORTION OF THE JEAN FARREL
 
27  ASSETS, PERHAPS UP TO 50 PERCENT.  IT ALSO RECITES THE
 
28  LEGION HAD BECOME INDEBTED BECAUSE OF LEGAL EXPENSES
			
			

page  14
 
 
 
 1  ASSOCIATED WITH THAT PROSECUTION OF THE LITIGATION.
 
 2            MAY OF '87, INTERROGATORY ANSWERS, THE NORTH
 
 3  CAROLINA CASE, AGAIN STATING THAT MR. CARTO WAS AN AGENT FOR
 
 4  THE LEGION AND THAT HE HAD FULL KNOWLEDGE THAT THE NECA
 
 5  STOCK HAD BEEN GIFTED TO THE PLAINTIFF.  AND ALSO THAT
 
 6  TOM MARCELLUS, WHO WILL BE TESTIFYING LATER HE WAS
 
 7  PREVIOUSLY CHIEF EXECUTIVE OFFICER OF THE PLAINTIFF; THAT HE
 
 8  HAD THE SAME KNOWLEDGE.  THOSE INTERROGATORIES ANSWERS ALSO
 
 9  RECITE THE LITIGATION AROUND THE WORLD WAS SIMILAR IN ALL
 
10  RESPECTS TO THE NORTH CAROLINA CASE IN WHICH THE
 
11  INTERROGATORIES ANSWERS SIGNED BY MR. CARTO AND VERIFIED BY
 
12  MR. CARTO EXIST, AND THEY STATE THAT AN ATTORNEY IN LONDON,
 
13  DAVID HOOPER, HAD RECORDS OF ALL OF THE LAWSUITS AROUND THE
 
14  WORLD.
 
15            1988 THERE’s ANOTHER BOARD OF DIRECTORS MEETINGS
 
16  THIS TIME RECITING THAT EIGHT DIRECTORS EXISTED OR ELECTED
 
17  AGAIN.  MR. AND MRS. FURR COULD NOT CONSTITUTE A MAJORITY.
 
18  1989 THERE’s A SIMILAR ELECTION OF DIRECTORS.  THIS TIME,
 
19  SEVEN DIRECTORS.  THEN 1990, MARCH 1990, AGAIN THERE’s A
 
20  BOARD OF DIRECTORS MEETING ELECTING SIX DIRECTORS.
 
21            JULY OF 1990 MR. CARTO RESPONDED TO
 
22  INTERROGATORIES STATING THAT HE HAD NOT WRITTEN OR SIGNED
 
23  DOCUMENTS ON BEHALF OF THE LEGION OTHER THAN SOME LETTERS ON
 
24  THE STATIONERY AND THAT HE HAD NO POWER TO MAKE ANY DECISION
 
25  ON BEHALF OF THE LEGION; THUS, DEMONSTRATING NO POWER HAD
 
26  BEEN GIVEN TO HIM TO DISPOSE OF THESE ASSETS.
 
27            THE LITIGATION IN EUROPE WAS SETTLED BY THE
 
28  SIGNATURE ON SEVERAL DOCUMENTS IN JULY 1990, INCLUDING A
			
			

page  15
 
 
 
 1  SETTLEMENT AGREEMENT STATING THAT 45 PERCENT OF THE ASSETS
 
 2  WOULD GO TO THE LEGION AND 55 PERCENT TO JEAN FARREL’s HEIR,
 
 3  JOAN ALTHAUS, AFTER PAYMENT OF COSTS.
 
 4            IF SHE TESTIFIES CONSISTENTLY WITH HOW SHE HAS
 
 5  BEFORE, DEFENDANT LAVONNE FURR WILL TESTIFY THAT AT THE TIME
 
 6  OF THE SETTLEMENT IT HAD NOT BEEN DISCLOSED TO HER HOW MUCH
 
 7  MONEY WAS INVOLVED.  EVEN NOW, SHE DOESN'T BELIEVE THERE WAS
 
 8  MORE THAN 1 MILLION DOLLARS, AND ALSO THAT SHE’s NEVER SEEN
 
 9  THE BANK ACCOUNT STATEMENTS OPENED TO RECEIVED THE MONEY,
 
10  NOR ANY INVENTORY.
 
11            THE SETTLEMENT ALSO INVOLVED AN AGREEMENT CALLED A
 
12  MANDATE AGREEMENT STATING THAT A MAN, ROLAND ROCHAT,
 
13  R-O-C-H-A-T, WAS TO BE NECA’s ONLY DIRECTOR AND WAS SUPPOSED
 
14  TO DIRECT THE — THE ASSETS IN TERMS OF THE SETTLEMENT
 
15  AGREEMENT.  AFTER PAYING THE INHERITANCE TAXES, THE
 
16  PROVISIONS OF THE MANDATE AGREEMENT WERE CARRIED OUT AND THE
 
17  SIGNING OF MR. Carto’s NAME WITH HIS AUTHORIZATION AND,
 
18  AGAIN, RECITES THE SAME FACTS THAT MISS JEAN FARREL HAD
 
19  OWNED NECA CORPORATION AND IDENTIFIES VARIOUS ASSETS,
 
20  INCLUDING UNSET DIAMONDS IN SINGAPORE, ALL OF WHICH WAS TO
 
21  BE DIRECTED 45 PERCENT TO THE PLAINTIFF AND 55 TO
 
22  JOAN ALTHAUS.
 
23            THE EVIDENCE WILL DEMONSTRATE THAT THE ASSETS,
 
24  ACCORDING TO MR. CARTO, WERE WORTH IN EXCESS OF 10 MILLION
 
25  DOLLARS.  ROLAND ROCHAT TRANSFERRED THE 45 PERCENT TO
 
26  PATRICK FOETISCH, WHO WAS HIRED BY MR. CARTO.  BANK ACCOUNT
 
27  WAS SET UP, AND MR. FOETISCH AND DEFENDANT HENRY FISCHER WAS
 
28  GIVEN SIGNATORY POWER OVER THE ACCOUNT.  ACCOUNT WAS SET UP
			
			

page  16
 
 
 
 1  IN THE NAME OF VIBET AT BANQUE CANTRADE, C-A-N-T-R-A-D-E,
 
 2  LAUSANNE, L-A-U-S-A-N-N-E, IN SWITZERLAND.  VIBET NEVER HAD
 
 3  ANY OTHER ASSETS OTHER THAN THIS MONEY THAT CAME FROM THE
 
 4  SETTLEMENT.
 
 5            THE EVIDENCE WILL DEMONSTRATE THAT DEFENDANT
 
 6  LAVONNE FURR RECEIVED 5 THOUSAND DOLLARS FROM THE SETTLEMENT
 
 7  AND THAT THE DEFENDANT, HENRY FISCHER, RECEIVED MONEY OVER
 
 8  AND ABOVE OUT-OF-POCKET EXPENSES IN THE SUM MR. CARTO AND
 
 9  FISCHER DECIDED WOULD BE SUFFICIENT.
 
10            THERE’s SOME BOARD MINUTE MEETINGS FROM JANUARY
 
11  1991 STATING THAT THE MONEY DUE TO BE LIBERATED DUE TO THE
 
12  PLAINTIFF WOULD BE LIBERATED SOON, AND AT WHICH TIME THE
 
13  PLAINTIFF WOULD BE ABLE TO PAY ITS MANY DEBTS, WHICH HAD
 
14  BEEN INCURRED OVER THE FIVE YEARS FOR ATTORNEYS.  AND IT
 
15  WOULD BE ABLE TO ESTABLISH A RESERVE BEYOND THAT.  FURTHER,
 
16  HE CITES MR. CARTO ASKED THAT HIS POWER OF ATTORNEY WOULD BE
 
17  CONFIRMED AND RENEWED.  AND RESOLUTION WAS PASSED
 
18  AUTHORIZING TO TAKE WHAT MEASURES WERE NECESSARY TO SECURE
 
19  THE PLAINTIFF’s PROPERTY WAS DERIVED FROM MISS JEAN FARREL.
 
20  POWER OF ATTORNEY WAS SIMILARLY GIVEN TO HENRY FISCHER
 
21  STATING THE SAME THING.
 
22            THEN THERE COMES A CRUCIAL BOARD MEETING.
 
23  ACTUALLY, THERE ARE 2 SETS OF MINUTES THAT RECITE.  THEY'RE
 
24  REPEATING WHAT HAPPENED AT THE MEETING OCCURING ON THE SAME
 
25  MOMENT ON THE SAME DAY.  BOTH ARE DATED MARCH 5, 1991.
 
26  LAVONNE FURR WILL TESTIFY THAT FIRST SET OF THEM WAS
 
27  PREPARED BY MR. CARTO.  AND THEY RECITE THERE WAS A BOARD
 
28  MEETING ATTENDED BY MR. AND MRS. FURR AND BY DIRECTORS
			
			

page  17
 
 
 
 1  THOMAS KERR, HARVEY TAYLOR, AND THEY ELECTED THEMSELVES AND
 
 2  ALSO JACK RINER, SAM DICKSON, AND NOEL MERRIHEW,
 
 3  M-E-R-R-I-H-E-W, SEVEN DIFFERENT PEOPLE, AS DIRECTORS.
 
 4            THEY RECITE MRS. FURR RAISED THE SUBJECT OF THE
 
 5  INHERITANCE AND THERE WAS A DISCUSSION.  A RESOLUTION WAS
 
 6  PASSED AND ACKNOWLEDGING MR. Carto’s VOLUNTEER WORK
 
 7  ACCEPTING HIS RESIGNATION AS AGENT AND THEN STATING THAT THE
 
 8  FARREL ESTATE PROCEEDS NOT BE ACCEPTED IN PLAINTIFF, BUT
 
 9  INSTEAD, DIVERTED.  MR. FURR AUTHORIZED AND DIRECTED PATRICK
 
10  FOETISCH, THE ATTORNEY IN SWITZERLAND HIRED BY MR. CARTO, TO
 
11  CARRY OUT THE DIVERSION.
 
12            YOU WILL HEAR TESTIMONY FROM PEOPLE WHO ARE STATED
 
13  IN THOSE MINUTES TO HAVE BEEN PRESENT, NOT ONLY WERE THEY
 
14  NOT PRESENT, BUT THEY WEREN'T CONSULTED.  THEY NEVER AGREED
 
15  TO THIS AFTER THE FACT OR BEFORE THE FACT.  THAT INCLUDES
 
16  HARVEY TAYLOR AND THOMAS KERR.
 
17            MR. AND MRS. FURR, IF THEY TESTIFY CONSISTENTLY
 
18  WITH HOW THEY HAVE BEFORE TESTIFIED, THEY NEVER SPOKE TO
 
19  MR. KERR, WHO IS STATED AS BEING PRESENT AND VOTING FOR
 
20  THIS, AND INSTEAD, CARTO CLAIMED TO HAVE SPOKEN TO THEM.  SO
 
21  THERE WASN'T A CONFERENCE CALL.  THERE WASN'T A MEETING,
 
22  FORMAL OR INFORMAL.  INDEED, SINCE THE SETTLEMENT HAD
 
23  ALREADY OCCURRED, THERE’s NO EVIDENCE THERE WAS ANY NEED TO
 
24  ABANDON THE ASSET.
 
25            IN ANY CASE, THERE ARE MINUTES OF ANOTHER SUPPOSED
 
26  MEETING OCCURRING AT PRECISELY THE SAME MOMENT SIGNED BY
 
27  MR. FURR RECITING THE ELECTION OF DIRECTORS AND STATING
 
28  THERE WAS NO OTHER BUSINESS AT THE MEETING OTHER THAN THE
			
			

page  18
 
 
 
 1  ELECTION OF THE DIRECTORS, FURTHER DEMONSTRATING THAT THE
 
 2  FIRST SET OF MINUTES SUPPOSEDLY APPROVING A DIVERSION OF THE
 
 3  ASSETS IS FRAUDULENT.
 
 4            THERE’s A MARCH 1991 LETTER DRAFTED BY MR. CARTO
 
 5  THAT STATES THAT AN OFFSHORE TRUST, INTERNATIONAL LEGION FOR
 
 6  THE SURVIVAL OF THE FREEDOM, WAS ESTABLISHED.  WE HAVE NO
 
 7  EVIDENCE ABOUT SUCH ENTITY.  NO ACCOUNTING HAS BEEN PROVIDED
 
 8  IF IT RECEIVED THE FUNDS OR NOT.
 
 9            THEN JUNE 5, 1991, THERE’s A LETTER SENT BY DAVID
 
10  HOOPER, LEGION’s LAWYER IN LONDON, TO MR. CARTO, THE
 
11  LEGION’s AGENT, STATING THAT THE REMAINDER OF FUNDS WERE TO
 
12  BE DIVIDED 45 PERCENT AGAIN GOING TO THE LEGION, AND THE
 
13  AMOUNTS WERE TO BE REMITTED TO ROLAND ROCHAT AND THE
 
14  TRANSFER HAD BEEN COMPLETED LESS A PAYMENT OF 25,000 POUNDS
 
15  FOR MR. HOOPER’s FEES.  AND THE LEGION HAD RECOVERED 45
 
16  PERCENT OF $16,855,000 — I'M SORRY $16,855,797.  THAT HAS
 
17  OVER 7.5 MILLION DOLLARS.  THAT MONEY HAD BEEN RECOVERED TO
 
18  THE ACTIONS OF MR. HOOPER.  LETTER DOESN'T MENTION ANYTHING
 
19  IN REFERENCE TO THE GEMS, SO IT’s UNKNOWN WHAT HAPPENED TO
 
20  THE GEMS.  PRESUMABLY THAT’s SOME UNKNOWN DOLLAR SUM ON TOP
 
21  OF THAT MONEY.
 
22            IF HE TESTIFIES CONSISTENT WITH HOW HE DID BEFORE,
 
23  THE EVIDENCE WILL DEMONSTRATE MR. CARTO KNOWS HOW THE FARREL
 
24  LITIGATION, 45 PERCENT THAT WENT TO VIBET, WAS SPENT.  AND
 
25  HE HAS DOCUMENTS IN HIS CONTROL MEMORIALIZING HOW IT WAS
 
26  SPENT AND THE DISTRIBUTION OCCURRED UNDER HIS DIRECTION
 
27  HANDLED BY PATRICK FOETISCH IN EUROPE.
 
28            WE KNOW SOME OF THE INCIDENTS OF DIVERSION BECAUSE
			
			

page  19
 
 
 
 1  THERE ARE SOME DOCUMENTS.  ONE IS A SEPTEMBER 25, 1991
 
 2  DOCUMENT OF $100,000 WIRED SUPPOSEDLY FOR THE PLAINTIFF TO
 
 3  FIRST INTERSTATE BANK.  THERE ARE ALSO SOME PROMISSORY
 
 4  NOTES.  THERE’s NO RESOLUTIONS AUTHORIZING ANY OF THE MONEY
 
 5  GOING TO VIBET OR VIBET LENDING THE MONEY TO LIBERTY LOBBY,
 
 6  THE FOUNDATION TO DEFEND THE FIRST AMENDMENT, BUT THERE ARE
 
 7  PROMISSORY NOTES STATING THAT MONEY WAS LENT BY VIBET, WHICH
 
 8  HAD NO OTHER SOURCE OF FUNDS TO LIBERTY LOBBY AND FOUNDATION
 
 9  TO DEFEND THE FIRST AMENDMENT.
 
10            THEN IN MARCH 1992 THERE’s ANOTHER MINUTES OF THE
 
11  BOARD OF DIRECTORS MEETING AGAIN ELECTING DIRECTORS.  THIS
 
12  TIME, SIX DIRECTORS.  AGAIN, MR. AND MRS. FURR ARE NOT A
 
13  MAJORITY OF THE DIRECTORS.  STATING THAT HARVEY TAYLOR AND
 
14  TOM KERR WERE PRESENT AND THEY APPROVED THE EARLIER YEAR'S,
 
15  MARCH 5, 1991 MINUTES.  MARCH 5, 1991 IS WHEN THERE WERE 2
 
16  SETS OF FRAUDULENT MINUTES FOR MEETINGS THAT NEVER
 
17  OCCURRED.  MR. TAYLOR AND KERR WILL TESTIFY THEY NEVER
 
18  PARTICIPATED IN THE MEETING APPROVING SUCH MINUTES.
 
19            THE TOTAL MONEY TO THE FOUNDATION TO DEFEND THE
 
20  FIRST AMENDMENT THAT WE SEEN DOCUMENTATION FOR, THE EVIDENCE
 
21  WILL SHOW, IS AT LEAST $750,000, TOGETHER WITH $2,750,000 AT
 
22  LEAST TO LIBERTY LOBBY.  ACCORDING TO THE DOCUMENTS PRODUCED
 
23  TO DATE, THAT THERE’s AT LEAST 3.5 MILLION DOLLARS THAT WAS
 
24  DIVERTED THROUGH VIBET TO LIBERTY LOBBY AND FOUNDATION TO
 
25  DEFEND THE FIRST AMENDMENT.
 
26            THEN IN DECEMBER 1992 MRS. FURR SIGNED MINUTES OF
 
27  ANOTHER BOARD MEETING PREPARED BY MR. CARTO STATING THAT THE
 
28  OFFICIALS IN SWITZERLAND REQUIRED A NEW POWER OF ATTORNEY
			
			

page  20
 
 
 
 1  FOR MR. FISCHER TO ACT ON BEHALF OF THE PLAINTIFF TO SECURE
 
 2  THE PROPERTY OF LEGION DERIVED FROM JEAN FARREL; THUS,
 
 3  FURTHER DEMONSTRATING THERE HAD BEEN NO APPROVAL OF ANY GIFT
 
 4  OR SALE OR DIVERSION OF ASSETS TO MR. CARTO OR ANYONE ELSE.
 
 5            MR. CARTO HAS ADMITTED THAT THE DIRECTORS INCLUDED
 
 6  PERSONS BEYOND MR. AND MRS. FURR.  1993, FOR EXAMPLE,
 
 7  INCLUDED TOM KERR AND HARVEY TAYLOR, THE PERSONS WHO WERE
 
 8  NOT PRESENT AT THE MEETING STATED TO BE PRESENT IN THE
 
 9  FRAUDULENT MINUTES.
 
10            ANOTHER MEETING WAS HELD MARCH 1993.  THIS TIME,
 
11  SEVEN DIRECTORS WERE ELECTED.  AGAIN, MR. AND MRS. FURR WERE
 
12  NOT THE MAJORITY OF THE DIRECTORS.  THEN IN JUNE OF 1993,
 
13  MR. CARTO TOLD TOM MARCELLUS, WHO IS THE PLAINTIFF’s C.E.O.,
 
14  THAT THE FARREL ESTATE MONEY WAS BEING TRANSFERRED TO,
 
15  QUOTE, “GOOD CAUSES,” CLOSED QUOTE.
 
16            JUNE 18, 1993, DEFENDANT LAVONNE FURR TOLD TOM
 
17  MARCELLUS, MR. CARTO HAD NO POWER OF ATTORNEY FOR THE LEGION
 
18  EXCEPT SPECIFIC MATTERS WHERE HE WAS GRANTED A FORMAL POWER
 
19  OF ATTORNEY.  AND MR. CARTO WAS VAGUE AND EVASIVE AND DIDN'T
 
20  KEEP HER AND MR. FURR INFORMED ON MATTERS CONCERNING THE
 
21  PLAINTIFF.  THE EVIDENCE WILL DEMONSTRATE MR. MARCELLUS
 
22  WROTE TO MRS. FURR SEEKING OTHER DOCUMENTS THAT FORMALIZED
 
23  WHAT MR. Carto’s CAPACITY AS AGENT WAS FOR THE BOARD.
 
24            ON JULY 13, 1993, MRS. CARTO TOLD TOM MARCELLUS
 
25  $250,000 HAD COME FROM THE FARREL ESTATE AND WAS PLACED INTO
 
26  THE VIBET BANK ACCOUNT BY THE LEGION SWISS ATTORNEY.  IT WAS
 
27  THEN LOANED BACK TO THE LEGION TO CREATE THE APPEARANCE ON
 
28  THE BOOKS THAT THERE WAS A SUBSTANTIAL DEBT IN CASE THERE
			
			

page  21
 
 
 
 1  WAS A FUTURE ADVERSE JUDGMENT BY A CREDITOR AGAINST THE
 
 2  LEGION.
 
 3            IN AUGUST OF 1993, THERE’s EVIDENCE THAT 100
 
 4  THOUSAND DOLLARS WAS WIRED TO LIBERTY LOBBY FROM THE
 
 5  LEGION’s BANQUE CANTRADE ACCOUNT.  THE EVIDENCE DEMONSTRATES
 
 6  CARTO ORDERED THE TRANSFER TO OCCUR.  IN AUGUST 1993,
 
 7  MRS. CARTO TOLD TOM MARCELLUS VIBET CONTROLLED THE FARREL
 
 8  ESTATE PROCEEDS.
 
 9            TOM MARCELLUS HAD A CONVERSATION WITH MRS. FURR ON
 
10  AUGUST 20 OR 21, 1993, WHERE SHE STATED SHE HAD NO INKLING
 
11  OF HOW MUCH MONEY THE LEGION HAD RECEIVED, WHERE THE MONEY
 
12  WAS, OR HOW IT WAS BEING DISBURSED; THAT MR. CARTO COULD NOT
 
13  SPREAD IT AROUND TO GOOD CAUSES, IT WASN'T HIS MONEY; AND
 
14  THAT MR. CARTO MIGHT TRY TO USE THE PLAINTIFF’s MONEY TO
 
15  HELP RECOVER LOSSES AT LIBERTY.
 
16            AUGUST 16, 1994, MRS. CARTO TOLD TOM MARCELLUS
 
17  THAT THE FARREL ESTATE PROCEEDS WERE BEING HELD IN
 
18  SWITZERLAND AND COULDN'T BE RELEASED UNTIL TAXES WERE PAID,
 
19  EXCEPT THAT $250,000 HELD BY VIBET COULD BE RELEASED, THAT
 
20  CARTO HAD SET UP VIBET TO KEEP THE MONEY FROM PLAINTIFF IN
 
21  CASE OF LITIGATION AGAINST THE PLAINTIFF.
 
22            AUGUST 27, 1993, TOM MARCELLUS HAD SEVERAL
 
23  TELEPHONE CONVERSATIONS WITH LEWIS AND LAVONNE FURR WHERE
 
24  MR. FURR STATED IT WAS HIS UNDERSTANDING THAT HE AND HIS
 
25  WIFE HAD BEEN USED AS PUPPET BOARD MEMBERS SO CARTO COULD DO
 
26  WHAT HE WANTED WITH PLAINTIFF; THAT THE 2 OF THEM DECIDED TO
 
27  RESIGN.
 
28            SEPTEMBER 16, 1993, THEY DID RESIGN IN A LETTER
			
			

page  22
 
 
 
 1  THAT DATE.  SEPTEMBER 24, 1993, MR. Carto’s AGENCY WAS
 
 2  TERMINATED.  SEPTEMBER 21, 1993, MR. CARTO WROTE A LETTER TO
 
 3  MRS. FURR ACKNOWLEDGING THAT THE FURRS HAD RESIGNED AND
 
 4  ASKING HER TO SIGN PURPORTED MINUTES OF A MEETING, A
 
 5  BACKDATED MEETING FROM MARCH 1993, WHICH HE ADMITS DIDN'T
 
 6  TAKE PLACE, AND ALSO ASKING THEM TO SIGN MINUTES OF A
 
 7  SEPTEMBER 16 MEETING WHICH HE ADMITS DIDN'T TAKE PLACE, SO
 
 8  HE COULD HAVE ON PAPER AN ELECTION OF HENRY FISCHER AND
 
 9  MRS. CARTO BEFORE THE FURRS RESIGNED.
 
10            THEREAFTER, THE FURRS WERE REPLACED BY THE
 
11  REMAINING DIRECTOR, THOMAS KERR, AND MR. CARTO WAS INFORMED
 
12  OF HIS TERMINATION.  DESPITE THE TERMINATION, THERE WERE
 
13  ADDITIONAL FRAUDULENT MINUTES OCCURRING AFTER THE
 
14  TERMINATION, FROM NOVEMBER 1993.  MR. AND MRS. FURR AND
 
15  MRS. CARTO HAVE CONTINUED TO HAVE PUPPET BOARD OF DIRECTORS
 
16  MEETINGS IN 1994 AND I STATED IN OPEN BANK ACCOUNTS AND MADE
 
17  DEMANDS FOR TURNOVER OF ALL ASSETS.  SUCH MEETINGS HAVE
 
18  OCCURRED IN 1995.
 
19            IN SUM, I BELIEVE THE EVIDENCE WILL DEMONSTRATE
 
20  THAT PLAINTIFF NEVER GAVE UP THIS ASSET, CONTINUES TO TRY TO
 
21  EXERCISE CONTROL OVER IT AND WAS DECEIVED BY THE DEFENDANTS
 
22  ABOUT THE LOCATION AND SIZE OF THE ASSETS, AND IT IS
 
23  CONTINUING TO BE DECEIVED TO THIS DAY.
 
24       THE COURT:  THANK YOU, SIR.  DID THE DEFENSE WANT TO
 
25  MAKE A STATEMENT NOW OR WAIT UNTIL LATER?
 
26       MR. WAIER:  NO, WE WOULD LIKE TO MAKE A STATEMENT, AN
 
27  OPENING STATEMENT.
 
28            AT THIS JUNCTURE I MOVE FOR NONSUIT, YOUR HONOR.
			
			

page  23
 
 
 
 1  HE’s NOT LAID OUT ESSENTIAL FACTS TO PROVE THE CASE AND THAT
 
 2  HE’s NOT LISTED THE SPECIFICITY, OTHER THAN SPECULATION, ANY
 
 3  DAMAGES AS A RESULT, WHICH ARE KEY AS TO ANY CLAIM THAT THEY
 
 4  HAVE.
 
 5       THE COURT:  I'LL DENY THE MOTION.  GO AHEAD.
 
 6       MR. WAIER:  OKAY.  AS A PRELIMINARY BEFORE I START MY
 
 7  OPENING STATEMENT, I WANT TO INDICATE TO THE COURT THAT I
 
 8  DID HEAR IN PLAINTIFF’s OPENING STATEMENT THAT THEY INDICATE
 
 9  THAT THEY ARE SEEKING REDRESS FOR DEFALCATIONS OR ALLEGED
 
10  DEFALCATIONS THAT TOOK PLACE SUBSEQUENT TO JULY 22, 1994,
 
11  THE DATE THE COMPLAINT WAS FILED.
 
12            UNDER THE LAW, THEY'RE NOT ENTITLED TO THAT.
 
13  UNDER THE LAW, THEY'RE NOT ENTITLED TO ANY CLAIM AFTER JULY
 
14  22, 1994, TO SEEK REDRESS.  AT LEAST IN THIS PROCEEDING,
 
15  THAT’s THE LAW.  THERE’s BEEN NO AMENDMENT TO THE
 
16  COMPLAINT.  AND THEREFORE, YOUR HONOR, I'M RAISING THIS
 
17  ISSUE NOW IN CASE THIS BECOMES AN ISSUE DOWN THE LINE WHERE
 
18  I'M GOING TO OBJECT AS TO THAT EVIDENCE.
 
19            I DO A BETTER JOB STANDING, IF I COULD.
 
20       THE COURT:  THAT’s FINE.  THERE’s A PODIUM THERE.
 
21       MR. WAIER:  LISTENED INTENTLY AS BEST I COULD TO
 
22  PLAINTIFF’s OPENING STATEMENT AS TO WHAT THEY INTEND TO
 
23  PROVE AT THE TIME OF THIS TRIAL.
 
24            I WANT TO CAUTION THE COURT IN LISTENING TO THE
 
25  EVIDENCE AND WEIGHING THE EVIDENCE AS TO THE NUMEROUS
 
26  EVIDENTIARY INFIRMITIES THAT ARE GOING TO SHOW UP DURING THE
 
27  COURSE OF THEIR PRESENTATION OF THEIR CASE.  A LOT OF WHAT
 
28  THEY SAY, THEY WILL BE UNABLE TO PROVE EITHER BECAUSE OF A
			
			

page  24
 
 
 
 1  LACK OF FOUNDATION FOR THE DOCUMENTS THEY INTEND TO BRING IN
 
 2  OR OTHER PROOF INFIRMITIES.  I WANT TO ALERT THE COURT TO
 
 3  THAT IN THE VERY BEGINNING BECAUSE I DO NOT BELIEVE THAT
 
 4  THEY CAN PROVIDE PROOF AS TO ANY OF THE CLAIMS ALLEGED IN
 
 5  THE COMPLAINT OR AS TO WHAT THEY JUST TOLD THE COURT IN
 
 6  OPENING STATEMENT.
 
 7            ALSO, SINCE THIS IS NOT A JURY TRIAL AND I KNOW
 
 8  YOU ARE SAVVY AT TRIAL, BUT I DO WANT TO INDICATE THERE ARE
 
 9  2 SIDES OF THIS CASE AND THAT TO KEEP AN OPEN MIND IN
 
10  LISTENING TO THE CASE AS YOU HEAR THE EVIDENCE COME IN.
 
11  THERE’s ANOTHER SIDE TO THE STORY AND WE'LL PRESENT THE STORY.
 
12            LET ME START OFF AT THE VERY BEGINNING.  WE'RE
 
13  DEALING WITH A PLAINTIFF CALLED THE LEGION FOR THE SURVIVAL
 
14  OF FREEDOM, INC., WHICH COUNSEL INDICATED TO YOU SOMETIMES
 
15  REFERRED TO AS L.S.F.  IT DOES HAVE A PUBLICATION CALLED THE
 
16  INSTITUTION FOR HISTORICAL REVIEW, BUT ONE OF THE PRIMARY
 
17  PROBLEMS THAT WE HAVE HERE, AS HAS BEEN INDICATED EARLIER BY
 
18  ME, IS A STANDING ISSUE:  WHO ACTUALLY IS THE LEGION?  WHO
 
19  CONTROLS THE LEGION?  AND IN FACT, THAT HAS BEEN BROUGHT OUT
 
20  IN OPENING STATEMENT BY MR. MUSSELMAN, AND THAT ISSUE IS
 
21  PRESENTLY PENDING IN HOUSTON, TEXAS, AND SHOULD BE DECIDED
 
22  ON NOVEMBER 8TH.
 
23            I BELIEVE THERE WILL BE A SUBSTANTIAL PROOF ISSUE
 
24  AS TO WHO IS THE LEGION AND THAT UNLESS THEY PASS OVER THAT
 
25  HURDLE, THEY DON'T GET TO ANY OF THE CLAIMS THEY ALLEGE IN
 
26  THEIR COMPLAINT.
 
27       MR. BEUGELMANS:  YOUR HONOR, I OBJECT TO THIS
 
28  ARGUMENT.  IT’s NOT GERMANE TO THE ISSUES IN THE COMPLAINT.
			
			

page  25
 
 
 
 1  THERE IS NO AFFIRMATIVE DEFENSE IN THE ANSWER THAT RAISES
 
 2  EITHER STANDING OR CAPACITY TO SUE.
 
 3            SECONDLY, THE ISSUE OF WHO THE DIRECTORS OF THE
 
 4  CORPORATION LAWFULLY ARE HAVE BEEN DECIDED BY THE DISTRICT
 
 5  COURT, COURT OF APPEAL.  MR. CARTO AND HIS WIFE BROUGHT SUIT
 
 6  AGAINST THE DIRECTORS IN 1991.  THE CASE WAS HEARD BY JUDGE
 
 7  POLIS IN ORANGE COUNTY.  THE PLAINTIFFS, MR. CARTO AND THE
 
 8  ALLIES, LOST.  THE CASE WENT TO APPEAL, AND THIS DECISION
 
 9  COME DOWN.  WE HAVE THIS MORNING A COPY OF THE COURT OF
 
10  APPEAL’s DECISION.
 
11       MR. WAIER:  THIS IS NOT AN ISSUE BEFORE THE COURT, YOUR
 
12  HONOR.
 
13       THE COURT:  LET ME READ THE DECISION, BUT I AM GOING TO
 
14  ALLOW THE ARGUMENT TO GO ON WITH — THE OPENING STATEMENT
 
15  TO GO ON OVER YOUR OBJECTION.  I HAVE READ, BY THE WAY, THE
 
16  WHOLE STATEMENT OF DECISION IN THE CASE.
 
17       MR. WAIER:  I TEND TO DISAGREE TO THE EXTENT AND SCOPE
 
18  OF WHAT COUNSEL PLACES ON THAT DECISION.
 
19            RETURNING FOR A MOMENT, BY WAY OF BACKGROUND --
 
20  AND I DON'T KNOW IF YOUR HONOR HAS HAD THE OPPORTUNITY TO
 
21  READ THE VARIOUS BRIEFS WE SUBMITTED TO THE COURT.
 
22       THE COURT:  I HAVE.
 
23       MR. WAIER:  I WILL ATTEMPT TO SUMMARIZE AS OPPOSED TO
 
24  REGURGITATE.  WE BELIEVE THE EVIDENCE WILL SHOW WHEN THE
 
25  COURT APPLIES THE LAW TO A NONPROFIT CORPORATION — AND
 
26  THAT’s WHAT WE'RE DEALING WITH HERE.  THE LEGION FOR THE
 
27  SURVIVAL OF FREEDOM, INC., IS A TEXAS NONPROFIT CORPORATION
 
28  GOVERNED BY LAWS FAR STRICTER AND FAR DIFFERENT THAN YOUR
			
			

page  26
 
 
 
 1  NORMAL PROFIT CORPORATIONS.  IN KEEPING WITH THE LAWS ON THE
 
 2  ISSUE, LET ME GO BACK AND EXPLAIN WHAT WE BELIEVE THE
 
 3  EVIDENCE WILL SHOW.
 
 4            WE BELIEVE THAT WHAT THE EVIDENCE WILL SHOW WAS
 
 5  THAT THE BOARD OF DIRECTORS, THROUGH LAVONNE AND LEWIS FURR,
 
 6  AMONG OTHERS, MADE A PRUDENT AND WISE DECISION IN 1985.
 
 7  THAT PRUDENT AND WISE DECISION, WHICH, BY THE WAY, THE
 
 8  EVIDENCE WILL SHOW IS THE ONLY DECISION THAT THEY COULD
 
 9  LEGALLY HAVE MADE, WAS NOT TO GO OVERSEAS AND COMMIT
 
10  RESOURCES OF THE LEGION TO FIGHT A COSTLY AND A VERY RISKY
 
11  LITIGATION IN SWITZERLAND TO RECOVER ASSETS OR ALLEGED
 
12  ASSETS FROM THE ESTATE OF JEAN FARREL-EDISON.
 
13            WE BELIEVE THAT THE EVIDENCE IS GOING TO SHOW THAT
 
14  PRIOR TO THAT TIME THAT THERE WAS A RUNNING RELATIONSHIP
 
15  BETWEEN DEFENDANT WILLIS CARTO, HIS WIFE ELISABETH CARTO,
 
16  AND JEAN FARREL-EDISON.  WE BELIEVE THAT THE EVIDENCE WILL
 
17  SHOW THAT JEAN FARREL-EDISON NOT ONLY WAS A MAJOR SUPPORTER
 
18  OF THE LEGION, BUT SHE WAS A MAJOR SUPPORTER OF OTHER
 
19  ORGANIZATIONS IN WHICH WILLIS CARTO WAS INVOLVED AND SUCH AS
 
20  LIBERTY LOBBY, INC.
 
21            ALSO, THE EVIDENCE IS GOING TO SHOW THAT SHE WAS
 
22  INVOLVED WITH ANOTHER ORGANIZATION, ONE THAT HAS BEEN
 
23  IDENTIFIED IN OPENING STATEMENT BY THE PLAINTIFF, AND THAT
 
24  IS AN ORGANIZATION — NONPROFIT ORGANIZATION CALLED THE
 
25  FOUNDATION TO DEFEND THE FIRST AMENDMENT; AND THAT THE
 
26  EVIDENCE WILL SHOW, THROUGH THE WORDS OF MR. MARCELLUS, THAT
 
27  MONEYS WERE TO GO TO THE FOUNDATION TO DEFEND THE FIRST
 
28  AMENDMENT AT THE EXPRESS DIRECTION OF MR. MARCELLUS.
			
			

page  27
 
 
 
 1            THE EVIDENCE WILL SHOW ON JANUARY 14, 1985,
 
 2  BEFORE — SHORTLY BEFORE JEAN FARREL-EDISON DIED,
 
 3  MR. TOM MARCELLUS, WHO HAS BEEN IDENTIFIED IN THE OPENING
 
 4  STATEMENT BY PLAINTIFF, WROTE JEAN FARREL-EDISON IN LUTRY,
 
 5  SWITZERLAND, A LETTER.  AND IN THIS LETTER TOWARD THE
 
 6  BOTTOM, HE STATES:  “TO JEAN FARREL-EDISON, AS FOR FUTURE
 
 7  CONTRIBUTIONS, PLEASE CONTINUE TO MAKE YOUR CHECKS OUT TO
 
 8  THE FOUNDATION TO DEFEND THE FIRST AMENDMENT OR JUST
 
 9  F.D.F.A. AND MAIL THEM HERE TO THE I.H.R. AT P. O. BOX 1306,
 
10  TORRANCE, CALIFORNIA.  THE ACCOUNT IS THE SAFEST ONE WE HAVE
 
11  AND CANNOT BE GRABBED BY OUR ENEMIES."
 
12            THE EVIDENCE WILL SHOW THAT ALL OF THE
 
13  ORGANIZATIONS WORK TOGETHER FOR A COMMON SCHEME TO PROMOTE
 
14  REVISIONISM, AMONG OTHER TOPICS, TO THE COMMON PUBLIC, TO
 
15  DISCUSS CONSTITUTIONAL ISSUES.  AND THEY WERE ALL IN THE
 
16  SAME BALL PARK, AS THE EVIDENCE WILL SHOW, WITH RESPECT TO
 
17  THEIR EDITORIALS THAT INCLUDED LIBERTY LOBBY, WHO PUT OUT
 
18  THE SPOTLIGHT.  YOU WILL SEE LETTERS FROM JEAN TALKING ABOUT
 
19  HOW SHE ENJOYED THE SPOTLIGHT, WHICH HAPPENED TO BE A
 
20  PUBLICATION OF LIBERTY LOBBY, INC., AND SHE WAS, THE
 
21  EVIDENCE WILL SHOW, A MAIN SUPPORTER OF LIBERTY LOBBY.  SHE
 
22  WAS A MAIN SUPPORTER OF THE LEGION.  SHE WAS A MAIN
 
23  SUPPORTER OF F.D.F.A.
 
24            COUNSEL POINTED OUT TO THE COURT THE EVIDENCE WE
 
25  BELIEVE WILL SHOW SHE DIED IN 1985.  HOWEVER, WHAT WAS NOT
 
26  DISCUSSED IN THE OPENING STATEMENT BY COUNSEL WAS THAT SHE
 
27  LEFT A WILL, AND THIS BECAME THE SUBJECT OF MUCH
 
28  CONTROVERSY.  THE EVIDENCE WILL SHOW THAT WILL LEFT NOTHING
			
			

page  28
 
 
 
 1  TO THE LEGION.  THEY WERE MERELY A SECONDARY BENEFICIARY.
 
 2  IT WILL SHOW THAT SHE LEFT HER ENTIRE ESTATE TO JOAN ALTHAUS
 
 3  WHO HAPPENED TO BE A HOUSEKEEPER AND NEIGHBOR OF JEAN
 
 4  FARREL-EDISON; AND ONLY, IF JOAN ALTHAUS PREDECEASED HER,
 
 5  THAT THE LEGION WOULD RECEIVE ANY MONIES.  THE EVIDENCE WILL
 
 6  SHOW THAT DIDN'T OCCUR.  THAT’s WHERE THE SAGA BEGINS AS TO
 
 7  WHY WE'RE HERE TODAY.
 
 8            WILLIS CARTO AND LIZ HAD A RUNNING RELATIONSHIP
 
 9  WITH JEAN FARREL-EDISON.  ELISABETH CARTO, THE EVIDENCE WILL
 
10  SHOW, VACATIONED WITH JEAN FARREL-EDISON ON NUMEROUS
 
11  OCCASIONS.  THE EVIDENCE WILL SHOW THAT SHE WANTED TO
 
12  CONTRIBUTE, ON HER DEATH, TO THE SAME CAUSES ESPOUSED BY
 
13  WILLIS AND ELISABETH CARTO, INCLUDING REVISIONISM, AMONG
 
14  OTHER ISSUES AND TOPICS.  SHE WANTED TO MAKE SURE THAT
 
15  WILLIS’s VOICE WAS CONTINUED TO BE HEARD IN THIS COUNTRY,
 
16  AND SHE WAS WILLING TO SUBSIDIZE THAT ON HER DEATH.
 
17            UNFORTUNATELY, WHAT THE EVIDENCE IS GOING TO SHOW
 
18  AFTER SHE DIED AND AFTER THE WILL CAME TO THE HEAD, JOAN
 
19  ALTHAUS MADE A CLAIM SHE WAS ENTITLED TO ALL OF THE ESTATE;
 
20  NO ONE ELSE WAS ENTITLED TO IT.  THAT INCLUDED CERTAIN BONDS
 
21  THAT WERE PLACED IN A CORPORATION BY THE WAY, THAT THE
 
22  EVIDENCE WILL SHOW THAT MR. CARTO, AMONG OTHERS, HELPED TO
 
23  FORM FOR HER BEFORE HER DEATH, AND THAT THESE BONDS WERE
 
24  VERY VALUABLE.
 
25            THE EVIDENCE WILL SHOW THAT SHE PLACED THESE BONDS
 
26  IN VARIOUS SAFETY DEPOSIT BOXES.  AT LEAST ONE LETTER THAT
 
27  WILL COME INTO PLAY SHOWS THAT THERE WERE 10, ONLY ONE OF
 
28  WHICH WAS DIRECTED TO THE LEGION.  THAT’s WHAT THE EVIDENCE
			
			

page  29
 
 
 
 1  WILL SHOW.  THE EVIDENCE WILL SHOW WHEN WILLIS HEARD ABOUT
 
 2  THE WILL, WHICH WAS HANDWRITTEN, BY THE WAY, IN FRENCH, THE
 
 3  EVIDENCE WILL SHOW THAT HE WENT TO LEWIS AND LAVONNE FURR.
 
 4            AND RETURNING FOR A MOMENT AS TO WHO CONTROLLED
 
 5  THE LEGION, BECAUSE THERE WAS MUCH BALLYHOO ABOUT THIS IN
 
 6  THE OPENING STATEMENT OF COUNSEL, THE LAW SHOWS THAT THERE
 
 7  IN A NONPROFIT CORPORATION IN TEXAS.  AND THE EVIDENCE WILL
 
 8  SHOW THIS.  THERE ARE TIERS OF SUPERVISORS, SO TO SPEAK, OR
 
 9  THOSE WHO CONTROL THE NONPROFIT CORPORATION.  WE HAVE, AT
 
10  THE TOP RUNG, MEMBERS OR INCORPORATORS, THE EVIDENCE WILL
 
11  SHOW, AND THEY CONTROL — THEY THEN HAVE THE POWER TO ELECT
 
12  DIRECTORS.  AND THOSE DIRECTORS HAVE THE POWER TO MAKE
 
13  CERTAIN DECISIONS.
 
14            BUT THE ULTIMATE DECISION LIES, AS THE EVIDENCE
 
15  WILL SHOW, IN THE INCORPORATORS.  THERE WILL BE UNREFUTED
 
16  EVIDENCE AT THE TIME OF TRIAL THAT WILLIS CARTO AND LAVONNE
 
17  FURR WERE THE ONLY 2 MEMBERS OR INCORPORATORS IN EXISTENCE
 
18  FOR THE LEGION IN 1985.  THEY WERE THE ONLY MEMBERS AND
 
19  INCORPORATORS IN EXISTENCE IN 1986.  IN OTHER WORDS, THE
 
20  EVIDENCE WILL SHOW THEY HAD THE POWER TO MAKE DECISIONS.
 
21            NOTWITHSTANDING THAT, WILLIS, AS THE EVIDENCE WILL
 
22  SHOW, CAME TO LAVONNE FURR AFTER JEAN FARREL-EDISON’s DEATH
 
23  AND INDICATED TO HER THAT SHE BELIEVED OR THAT HE BELIEVED
 
24  THAT THOSE ASSETS OR SOME OF THOSE ASSETS SHOULD BELONG TO
 
25  THE VARIOUS CAUSES THAT HE REPRESENTED AND THAT THE LEGION
 
26  SHOULD BE ENTITLED TO SOME OF THAT ESTATE AS WELL.  THE
 
27  EVIDENCE WILL SHOW THAT THE LEGION WAS ESSENTIALLY
 
28  BANKRUPT.  THAT’s WHAT THE EVIDENCE WILL SHOW.  IT COULD NOT
			
			

page  30
 
 
 
 1  PHYSICALLY AFFORD COSTLY LITIGATION OVERSEAS AGAINST A
 
 2  RESIDENT WHOSE VENUE THE LITIGATION WOULD BE PURSUED.
 
 3            GIVEN THAT, WILLIS PROVIDED A PROPOSAL TO THE
 
 4  LEGION.  THE EVIDENCE WILL SHOW THAT PROPOSAL WAS ACCEPTED
 
 5  IN WRITING.  THAT PROPOSAL STATED WHATEVER IS RECOVERED, IF
 
 6  ANYTHING, MUST FIRST BE USED TO PAY ALL OF THE EXPENSES,
 
 7  WHATEVER THEY MAY BE, AND PRORATE TO THE SOURCES IF WE HAVE
 
 8  TO.  IN OTHER WORDS, IF THE LEGION WERE TO PROVIDE ANY TYPE
 
 9  OF REVENUES, WITH RESPECT TO THE RECOVERY OF THOSE ASSETS,
 
10  TO THE EXTENT OF THEIR INVOLVEMENT, IT WOULD BE PRORATED TO
 
11  THEIR PERCENTAGE INTEREST.
 
12            THE EVIDENCE WILL SHOW THEY DIDN'T PAY ONE DIME
 
13  TOWARDS ANY RECOVERY.  THE ONLY PROMISE THAT WILLIS MADE IN
 
14  CONNECTION WITH THE PROPOSAL THAT THE EVIDENCE WILL SHOW WAS
 
15  THAT HE WOULD CONTINUE TO SUPPORT FINANCIALLY FOR, QUOTE,
 
16  YEARS TO COME, THE LEGION EFFORTS.  HE DID THAT UP UNTIL
 
17  1993 WHEN HE WAS IMPROPERLY OUSTED FROM WHAT WE NOW KNOW IS
 
18  THE LEGION.
 
19            FOLLOWING THE RECEIPT OF THIS PROPOSAL AGAIN, AND
 
20  THE EVIDENCE WILL SHOW IT WAS ACCEPTED AND, IN FACT, THERE
 
21  WAS A SPECIAL DIRECTORS MEETING CALLED AND THE EVIDENCE WILL
 
22  SHOW THAT THESE MEETINGS, THOUGH THEY SAY CERTAIN
 
23  INDIVIDUALS WERE PRESENT, THESE MEETINGS, THE MINUTES WILL
 
24  SHOW CERTAIN INDIVIDUALS WERE PRESENT.  WHAT WAS MEANT BY
 
25  THAT AND THE EVIDENCE WILL SHOW WAS THAT PEOPLE WERE
 
26  CONSULTED.
 
27            THE EVIDENCE IS GOING TO SHOW MOST OF THE MEETINGS
 
28  OF THE BOARD OF DIRECTORS AND THE MEMBERS OF THE LEGION TOOK
			
			

page  31
 
 
 
 1  PLACE BY PHONE, WERE INFORMAL, AND THE EVIDENCE WILL SHOW
 
 2  THAT THAT WAS PERFECTLY LEGAL AND PERFECTLY PROPER, AND IN
 
 3  FACT, MOST CORPORATIONS FOLLOW THOSE SAME TYPE OF
 
 4  PROCEDURES.
 
 5            BUT MORE IMPORTANTLY, THIS SPECIAL DIRECTORS
 
 6  MEETING WAS CALLED.  IN THAT DIRECTORS MEETING, IT WAS
 
 7  AGREED PURSUANT TO THAT PROPOSAL FOR WILLIS CARTO, QUOTE,
 
 8  “THAT THE BUSINESS AGENT OF THE CORPORATION, MR. W.A.
 
 9  CARTO, IS HEREBY AUTHORIZED AND INSTRUCTED TO TAKE WHATEVER
 
10  MEASURES AS IN HIS JUDGMENT ARE REQUIRED TO SECURE THE
 
11  PROPERTY OF THE CORPORATION WHOLLY-OWNED SUBSIDIARY NECA
 
12  CORPORATION AND THAT THE POWER OF ATTORNEY FOR THIS
 
13  CORPORATION BE GIVEN BY THE CORPORATE SECRETARY TO MR. CARTO
 
14  FOR THIS PURPOSE.”  WELL, NECA WAS NOT ANY WHOLLY-OWNED
 
15  SUBSIDIARY OF THE LEGION, NEVER HAS BEEN, NEVER WAS.
 
16            BUT NOTWITHSTANDING THAT, THE BOARD OF DIRECTORS
 
17  PROVIDED MR. CARTO WITH A POWER OF ATTORNEY.  AND WHY IS
 
18  THIS IMPORTANT, YOUR HONOR?  BECAUSE PLAINTIFF, IN HIS
 
19  OPENING STATEMENT, SAYS IT’s THE BASIS OF THIS POWER OF
 
20  ATTORNEY WHICH RAISES THE FIDUCIARY RELATIONSHIP UPON WHICH
 
21  THE CLAIMS AGAINST MR. CARTO EXIST.  IN THE SAME BREATH, IN
 
22  THE OPENING STATEMENT, THE EVIDENCE — THEY SAY THE
 
23  EVIDENCE WILL SHOW THAT THE POWER OF ATTORNEY WERE ALL
 
24  RUSES.  THEY WEREN'T PROVIDED BY THE BOARD OF DIRECTORS,
 
25  THEY WERE NEVER VOTED ON BY THE BOARD OF DIRECTORS, AND
 
26  THEREFORE, THE ACTIONS TAKEN BY THE BOARD OF DIRECTORS WERE
 
27  NOT LEGAL.
 
28            WELL, IF THAT IS THE CASE, THEY CAN'T HAVE THE
			
			

page  32
 
 
 
 1  CAKE AND EAT IT TOO.  THEY CAN'T SAY THAT THEY BASE THEIR
 
 2  LAWSUIT ON A COMPLAINT BASED ON A FIDUCIARY RELATIONSHIP
 
 3  ARISING OUT OF A POWER OF ATTORNEY AND, IN THE SAME BREATH,
 
 4  SAY THERE’s NO POWER OF ATTORNEY BECAUSE IT WASN'T PROPERLY
 
 5  AUTHORIZED.
 
 6            THAT’s THE IMPORTANCE OF THIS.  AS THE EVIDENCE
 
 7  WILL SHOW, WHEN IT SUITS THE LEGION TODAY, FOR THEIR
 
 8  PURPOSES OR FOR THE PURPOSES OF THE INSIDERS TODAY, THEY'LL
 
 9  UTILIZE WHATEVER INFORMATION THEY HAD IN THE PAST.  WHEN IT
 
10  DOESN'T SUIT THEM, THEY SAY IT’s A RUSE.  AND THAT’s WHAT
 
11  THE EVIDENCE IS GOING TO SHOW.
 
12            IN ANY EVENT, THE EVIDENCE IS GOING TO SHOW, ARMED
 
13  WITH THE VARIOUS POWERS OF ATTORNEY, WILLIS AND ANOTHER
 
14  INDIVIDUAL BY THE NAME OF HENRY FISCHER WENT OVERSEAS AND
 
15  BATTLED JOAN ALTHAUS OUT OF THEIR OWN POCKETS, OUT OF COMING
 
16  OUT OF CORPORATIONS THAT WERE CONTROLLED — NONPROFIT
 
17  CORPORATIONS CONTROLLED, AND AGAIN, WITH THE SAME IDEOLOGY
 
18  AS THE LEGION, LIBERTY LOBBY, F.D.F.A., TO ATTEMPT TO
 
19  RECOVER SOME OF THESE ASSETS.
 
20            THE EVIDENCE IS GOING TO SHOW AFTER A 5-YEAR
 
21  QUEST, A SETTLEMENT WAS EVENTUALLY REACHED.  THIS OCCURRED
 
22  IN 1990.  THE EVIDENCE IS GOING TO SHOW, BY THE WAY, THAT
 
23  LEWIS AND LAVONNE FURR WERE KEPT AWARE OF EVERYTHING THAT
 
24  TOOK PLACE.  THEY WERE IN CONSTANT CONTACT WITH MR. CARTO,
 
25  EVEN HAD AT LEAST ONE CONVERSATION WITH MR. FISCHER,
 
26  CONCERNING WHAT WAS TO TAKE PLACE.  THE EVIDENCE WILL SHOW
 
27  THEY APPROVED OF THIS SETTLEMENT.  THIS SETTLEMENT, THE
 
28  SETTLEMENT APPARENTLY ALLEGEDLY APPEARS IN VARIOUS
			
			

page  33
 
 
 
 1  DOCUMENTS.
 
 2            AS I CAUTIONED THE COURT BEFOREHAND, IT IS
 
 3  EXTREMELY IMPORTANT ON EVIDENTIARY ISSUES THAT WE LOOK AT
 
 4  THESE DOCUMENTS BECAUSE THE EVIDENCE IS GOING TO SHOW — I
 
 5  DON'T — I THINK THE EVIDENCE WILL SHOW, FIRST OF ALL, THEY
 
 6  WOULD BE UNABLE TO BRING IN THE DOCUMENTS INTO EVIDENCE
 
 7  BECAUSE THERE WILL BE NO FOUNDATION LAID FOR IT; AND TWO,
 
 8  MORE IMPORTANTLY, THE EVIDENCE WILL SHOW, UNLIKE WHAT
 
 9  COUNSEL HAS SAID IN THE OPENING STATEMENT, THESE DOCUMENTS
 
10  WERE NOT SIGNED BY MR. CARTO.  THE EVIDENCE IS GOING TO SHOW
 
11  THEY WERE SIGNED BY SOME THIRD PARTY.
 
12            YOU WILL RECALL COUNSEL DISCUSSED VARIOUS
 
13  ATTORNEYS THAT WERE HIRED.  THEY WERE ALL HIRED BY
 
14  MR. CARTO.  THAT’s WHAT THE EVIDENCE WILL SHOW.  ATTORNEYS
 
15  HAD TO BE HIRED OVERSEAS, HAD A TREMENDOUS COST AND
 
16  OCCURRENCES OF FEES.  ALSO, THE EVIDENCE IS GOING TO SHOW
 
17  THAT PAT FOETISCH, WHO YOU DID HEAR ABOUT IN OPENING
 
18  STATEMENT, WAS NOT HIRED BY MR. CARTO.  HE WAS HIRED BY THE
 
19  BOARD, AND THAT TOOK PLACE CONSISTENT WITH BOARD MINUTES.
 
20            THESE ARE MARCH 5, 1991 MINUTES THAT WILL COME
 
21  INTO PLAY, THE LEGION MINUTES WHERE HE WAS TO --
 
22  MR. FOETISCH WAS TO DIRECT, PURSUANT TO BOARD MINUTES, THE
 
23  ASSETS OF THE FARREL-EDISON ESTATE THAT WERE RECOVERED
 
24  THROUGH THE SETTLEMENT AT THE DIRECTION OF WILLIS CARTO IN
 
25  ANY FASHION HE DEEMED FIT.  THAT’s WHAT THE LANGUAGE IS
 
26  GOING TO SAY TO THIS COURT.  IN OTHER WORDS, THE BOARD,
 
27  ACKNOWLEDGING WILLIS’s CONTRIBUTIONS AND EFFORTS, ALLOWED
 
28  HIM TO DIRECT THESE ASSETS TO THOSE CAUSES THAT HE SAW FIT,
			
			

page  34
 
 
 
 1  INCLUDING THOSE THAT WERE ESPOUSED BY JEAN FARREL-EDISON.
 
 2            AND MORE IMPORTANTLY, AGAIN, I WANT TO INDICATE TO
 
 3  THIS COURT THESE WILL BE COMING IN.  I DON'T BELIEVE THEY'LL
 
 4  BE ABLE TO BE BROUGHT INTO EVIDENCE.  TO THE EXTENT THAT
 
 5  THEY DO COME INTO EVIDENCE, AT LEAST FROM A FOUNDATIONAL
 
 6  BASIS, YOU WILL SEE DOCUMENTS SUCH AS THIS ONE — AND THIS
 
 7  IS ONLY THE LAST PAGE OF THIS DOCUMENT WHERE THERE ARE
 
 8  SIGNATURES FOR WILLIS CARTO, AND LEGION FOR THE SURVIVAL OF
 
 9  FREEDOM INC.  THESE ARE NOT WILLIS Carto’s SIGNATURE, NOR
 
10  DID HE SIGN ON BEHALF OF THE LEGION.  THESE WERE SIGNED BY
 
11  SOMEONE ELSE.  THESE ARE NOT HIS SIGNATURES.
 
12            BY GOING BACK TO THE AGREEMENT, WHICH THE EVIDENCE
 
13  WILL SHOW WAS APPROVED BY THE LEGION, THE LEGION WAS
 
14  AUTHORIZED IN ADVANCE OF THE AGREEMENTS BEFORE THEY WERE
 
15  SIGNED BY WHOMEVER AND WAS AGREED TO AND RATIFIED BY THE
 
16  LEGION.  AS THE EVIDENCE WILL SHOW, COUNSEL STATED THAT 45
 
17  PERCENT OF THE ASSETS, ACCORDING TO THE AGREEMENTS, WERE TO
 
18  GO TO THE LEGION.  THAT’s NOT SO.  THE EVIDENCE IS GOING TO
 
19  SHOW THAT’s NOT WHAT THE AGREEMENT SAYS.
 
20            THE AGREEMENT, CALLED THE DISTRIBUTION AGREEMENT,
 
21  HAS PARTIES BETWEEN THEM.  JOAN ALTHAUS IS ONE PARTY AND TWO
 
22  OTHER — ACTUALLY, A NUMBER OF OTHER PARTIES.  BUT MORE
 
23  IMPORTANTLY, THE LEGION FOR THE SURVIVAL OF FREEDOM, INC.,
 
24  IS ANOTHER PARTY TO THE SETTLEMENT AGREEMENT AND WILLIS
 
25  CARTO, AN INDIVIDUAL.  WHAT IS IMPORTANT TO THIS, THIS IS
 
26  THE VERY AGREEMENT, RATIFIED, STATES “PARTIES 2 AND 3
 
27  HEREINAFTER COLLECTIVELY REFERRED TO AS THE LEGION.”  SO
 
28  FROM THIS POINT FORWARD IN THE AGREEMENT, BOTH ARE
			
			

page  35
 
 
 
 1  CONSIDERED THE LEGION FOR NOMENCLATURE PURPOSES.
 
 2            WHY IS THAT IMPORTANT?  BECAUSE COUNSEL SAID THAT
 
 3  THE AGREEMENT SAYS THAT THE LEGION GETS THE MONEY.
 
 4  TECHNICALLY, HE’s CORRECT.  BUT THE LEGION IS DEFINED
 
 5  ACCORDING TO THE VERY DOCUMENT UPON WHICH THEY RELY.  AND
 
 6  THERE’s PAROLE EVIDENCE PROBLEMS THEY'LL HAVE TO GET OVER.
 
 7  THEY'RE NOT GOING TO BE ENTITLED TO INCLUDE PAROLE EVIDENCE
 
 8  IN THIS MATTER; STATE SPECIFICALLY, IF I CAN FIND QUICKLY,
 
 9  THIS PORTION OF THE AGREEMENT, “IT IS HEREBY AGREED
 
10  THAT” — THIS IS ON PARAGRAPH 4 OF THE DISTRIBUTION
 
11  AGREEMENT — “M. ROCHAT” — AND YOU HEARD ABOUT
 
12  MR. ROCHAT.  HE HELPED DISTRIBUTE THE ASSETS — “WILL
 
13  DISTRIBUTE THE NET ASSETS OF NECA AS TO 55 PERCENT TO J.A.,"
 
14  JOAN ALTHAUS, “AND AS TO 45 PERCENT TO THE LEGION,” MEANING
 
15  BOTH THE LEGION AND WILLIS CARTO INDIVIDUALLY BY THE EXACT
 
16  LANGUAGE OF THE AGREEMENT, THE VERY AGREEMENT I MIGHT ADD
 
17  THAT THE LEGION IS NOW RELYING UPON CLAIMING THEY WERE
 
18  ENTITLED TO ALL OF IT WHEN THE AGREEMENT SAYS OTHERWISE.
 
19  AND IN FACT, THIS IS CONSISTENT WITH THE PROPOSAL THAT WAS
 
20  AGREED UPON BY MR. CARTO AND THE LEGION, AS THE EVIDENCE
 
21  WILL SHOW, BACK IN 1986, EARLY 1986.
 
22            NOW THE EVIDENCE IS GOING TO SHOW THAT MR. CARTO
 
23  DIDN'T RECEIVE ONE PENNY IN HIS OWN POCKET OVER THIS.  THE
 
24  EVIDENCE, WE BELIEVE, SUBJECT TO SOME EVIDENTIARY
 
25  INFIRMITIES THAT THE PLAINTIFF MAY HAVE, IN SHOWING ANYTHING
 
26  THAT CAME OUT OF THAT ESTATE, WENT TO THE VERY CAUSES THAT
 
27  JEAN FARREL-EDISON WANTED THOSE FUNDS TO GO TO THOSE TO
 
28  EXPRESS AN EDITORIAL OVER THE RADIO AND PRESS, CONSTITUTIONAL
			
			

page  36
 
 
 
 1  VIEWS SHE BELIEVED IN, SIMILAR TO THE DIRECTION SHE GAVE
 
 2  WILLIS, AS THE EVIDENCE WILL SHOW, BEFORE SHE DIED AND TO
 
 3  THE DIRECTION THAT THE LEGION APPROVED OF AFTER HER DEATH.
 
 4            THE EVIDENCE WILL SHOW THAT LEWIS AND LAVONNE
 
 5  FURR, AS EARLY AS 1990, CONSISTENT TO THE WAY THEY HAVE
 
 6  TESTIFIED IN DEPOSITION, KNEW ABOUT THE ASSETS, KNEW ABOUT
 
 7  THE DISTRIBUTIONS OF MR. CARTO, KNEW EXACTLY WHERE THESE
 
 8  MONIES WERE GOING TO AND APPROVED THEM, WHICH CREATES A VERY
 
 9  SERIOUS STATUTE OF LIMITATIONS PROBLEM, WHICH WE RAISED IN
 
10  CONNECTION WITH THE BIFURCATION MOTION WHEN WE WERE STILL
 
11  GOING TO HAVE A JURY.  AND THOSE CONSIDERATIONS, WE BELIEVE,
 
12  WILL SHOW THAT THIS MATTER, ALL COUNTS OF THE LEGIONS ARE
 
13  BARRED BY THE PARTICULAR STATUTE OF LIMITATION.  THESE ARE
 
14  THE 3-YEAR OR OUTSIDE 4-YEAR STATUTE OF LIMITATIONS.  I URGE
 
15  THE COURT, IN REVIEWING THE EVIDENCE, TO KEEP THAT IN THE
 
16  BACK OF YOUR MIND THAT THE STATUTE IS LOOMING.
 
17            THE OTHER ISSUE THAT COMES TO PLAY IN THE
 
18  LITIGATION, EVEN THOUGH IT DEALS WITH ONE OF THE AFFIRMATIVE
 
19  DEFENSES IN THE DEFENDANT’s ANSWER, AND THAT DEALS WITH THE
 
20  TERM LACHES.  I THINK IT’s AN IMPORTANT ISSUE HERE.  IT ALSO
 
21  GOES AND COVERS ANOTHER MAJOR ISSUE, AND THAT IS CORPORATE
 
22  OPPORTUNITY.
 
23            THE EVIDENCE IS GOING TO SHOW THAT THERE WAS NO
 
24  CORPORATE OPPORTUNITY.  IN OTHER WORDS, THE EVIDENCE IS
 
25  GOING TO SHOW THAT THE LEGION HAD TO HAVE THE WHEREWITHAL
 
26  WITHIN WHICH TO TAKE PART IN THIS SUPPOSED OPPORTUNITY.
 
27  REMEMBER, YOUR HONOR, THE REASON WHY I RAISE THE ISSUE NOW,
 
28  THE LEGION, IN THE OPENING STATEMENT — IN THE OPENING
			
			

page  37
 
 
 
 1  STATEMENT, WANTS TO STAND ON THE GROUND OF 1990 WHEN THERE
 
 2  IS, ALL OF A SUDDEN, SOMETHING CALLED AN ASSET — OR 1991
 
 3  WHEN THERE’s SOMETHING CALLED AN ASSET SITTING HERE.
 
 4            THAT’s WHAT THEY'RE STANDING ON.  IT IS TO GET TO
 
 5  THAT ASSET IS WHAT WE'RE TALKING ABOUT, AS TO WHO OWNS THAT
 
 6  ASSET.  WAS THERE AN OPPORTUNITY AT THE TIME IN 1985 UPON
 
 7  JEAN FARREL-EDISON’s DEATH THAT COULD HAVE BEEN AVAILED BY
 
 8  THE CORPORATION TO GET TO THAT 1991 ASSET.  THAT IS THE
 
 9  KEY.  THE EVIDENCE WILL SHOW THAT THE LEGION DID NOT HAVE
 
10  THE WHEREWITHAL TO DO THAT.  THE LEGION WILL SHOW IT
 
11  CONSIDERED THAT.  THE LEGION — I MEAN, STRIKE THAT.
 
12            THE EVIDENCE WILL SHOW THAT THAT WAS CONSIDERED BY
 
13  THE LEGION.  IT DECIDED NOT TO PARTICIPATE TO THE EXTENT OF
 
14  ONLY THE USE OF ITS NAME WITH COURT DOCUMENTS, TO THE EXTENT
 
15  THAT THAT WOULD HELP BENEFIT MR. CARTO IN HIS QUEST TO
 
16  RECOVER THE ASSET FOR THE PROMISE IN RETURN THAT THEY WOULD
 
17  RECEIVE SOME FINANCING FOR YEARS TO COME, SOME NONDESCRIPT
 
18  FINANCING FOR YEARS TO COME, WHICH THEY RECEIVED.  THE
 
19  EVIDENCE WILL SHOW THEY RECEIVED APPROXIMATELY $750,000.
 
20            WE BELIEVE THE EVIDENCE WILL ALSO SHOW THAT OF
 
21  THE, QUOTE, 7.1 MILLION THAT COUNSEL HAS INDICATED IN
 
22  OPENING STATEMENT, WHICH I DON'T BELIEVE THEY CAN SHOW WITH
 
23  ANY COMPETENT EVIDENCE, THAT WAS NOT WHAT WAS RECOVERED.
 
24  THAT OF THE MONIES THAT WERE RECOVERED THERE WAS SUBSTANTIAL
 
25  TAXES AND 50 PERCENT TAXES PAID ON THAT AMOUNT.  OF THAT,
 
26  THERE WERE ATTORNEY’s FEES THAT CAME OUT OF THAT AMOUNT.
 
27  THERE WAS REIMBURSEMENT OF COSTS THAT CAME OUT OF THAT
 
28  AMOUNT.  THERE WAS REIMBURSEMENT CONSISTENT WITH THE
			
			

page  38
 
 
 
 1  PROPOSAL TO THOSE PARTIES WHO CONTRIBUTED, AND $750,000 OF
 
 2  WHICH ALSO WENT TO THE LEGION, INCLUDING, I MIGHT ADD, YOUR
 
 3  HONOR, THE EVIDENCE WILL SHOW MR. MARCELLUS HIMSELF RECEIVED
 
 4  SUBSTANTIAL FUNDS.
 
 5            AND THE EVIDENCE WILL ALSO SHOW THAT THEY WILL BE
 
 6  RELYING ON MR. MARCELLUS.  FOR A LOT OF THIS TESTIMONY,
 
 7  MR. MARCELLUS WILL BE SHOWN TO BE A FRAUD.  MR. MARCELLUS
 
 8  WILL BE SHOWN BY THE EVIDENCE THAT HE IS NOT IMMUNE FROM
 
 9  GERRYMANDERING DOCUMENTS TO SUPPORT HIS POSITIONS, SUCH AS
 
10  SIGNING VARIOUS UCC-1 FORMS AND ENCUMBERING THE ASSETS OF
 
11  THE LEGION WHEN HE ENCUMBERED THEM ALREADY WITH ANOTHER UCC
 
12  FORM.  HE WILL BE SUBSTANTIALLY IMPEACHED TO HIS
 
13  CREDIBILITY.  AND I WANT TO ALERT THE COURT TO THOSE
 
14  CIRCUMSTANCES NOW BECAUSE THAT’s WHAT THE EVIDENCE WILL
 
15  SHOW.  HE’s NOT A RELIABLE WITNESS.
 
16            THE EVIDENCE WILL SHOW, YOUR HONOR, THAT — I
 
17  SHOULDN'T SAY “THE EVIDENCE WILL SHOW.”  DEFENDANTS BELIEVE
 
18  THAT THE LEGION WILL NOT BE ABLE TO SHOW ANY EVIDENCE AS TO
 
19  THE NET AMOUNT WITH RESPECT TO THAT ESTATE, THE NET AMOUNT
 
20  THAT WAS EVER RECOVERED.  THE EVIDENCE WILL SHOW THAT
 
21  MR. WILLIS CARTO DOESN'T HAVE THAT ASSET.  THE EVIDENCE WILL
 
22  SHOW THAT — THAT THOSE ASSETS BELONG TO SOMEONE OVERSEAS
 
23  WHO THEY NEITHER SUBPOENAED, NEITHER TAKEN A DEPOSITION OF,
 
24  NEITHER GOTTEN ANY INFORMATION FROM, THOUGH THEY HAVE
 
25  TRIED.
 
26            THERE WILL BE NO COMPETENT EVIDENCE AS TO WHAT IS
 
27  IN THAT ESTATE, WHAT WAS RECOVERED FROM THAT ESTATE, AND THE
 
28  DOCUMENTS UPON WHICH THEY RELY WILL BE — ARE HEARSAY, NOT
			
			

page  39
 
 
 
 1  SUBJECT TO ANY EXCEPTION.  IN OTHER WORDS, THEY WILL NOT BE
 
 2  ABLE TO — WE BELIEVE THEY WILL NOT BE ABLE TO LAY A
 
 3  COMPETENT FOUNDATION FOR THE INTRODUCTION OF ANY DOCUMENTS
 
 4  ALLUDED TO IN THE OPENING STATEMENT BY COUNSEL.  AGAIN, I
 
 5  REFER THE COURT TO THE PROOF PROBLEMS THEY'RE GOING — THAT
 
 6  WILL BE EXISTENT AND I WANT TO ALERT THE COURT TO THAT NOW.
 
 7            IT IS TRUE, IN TALKING ABOUT VARIOUS MINUTES — I
 
 8  WILL WRAP THIS UP IN 5 MINUTES, YOUR HONOR.  I NOTICE YOU
 
 9  ARE LOOKING AT THE CLOCK INTENTLY.
 
10       THE COURT:  NOT INTENTLY.  I GLANCED.  I DON'T HAVE TO
 
11  LOOK AT A CLOCK INTENTLY.  I CAN LOOK AT IT ONCE.
 
12       MR. WAIER:  I'M SORRY.
 
13            ON MARCH 5, 1991, THE EVIDENCE IS GOING TO SHOW
 
14  THAT THE LEGION PASSED 3 RESOLUTIONS.  THOSE 3 RESOLUTIONS
 
15  NOT ONLY CONFIRMED WILLIS' AUTHORITY TO DIRECT THE ASSETS OF
 
16  MRS. FARREL-EDISON’s ESTATE AT HIS DISCRETION, HE HAD
 
17  UNFETTERED RIGHT TO SEND THOSE IN ANY DIRECTION HE WANTED
 
18  TO, WHATEVER WAS THE LEGION WOULD BE ENTITLED TO.  BUT THE
 
19  RESULT OF ANY FUNDS WOULD NOT BE ACCEPTED INTO THE LEGION.
 
20  THAT’s WHAT THE MINUTES SAY, “DON'T PUT THEM INTO THE
 
21  LEGION.”  IN 1991, THAT’s WHAT THE MINUTES SAY.
 
22            THE EVIDENCE WILL ALSO SHOW THAT THEY SHOULD BE
 
23  DIRECTED TO AN INDEPENDENT SETUP CORPORATION.  THIS IS THE
 
24  DIRECTION THAT THE LEGION BOARD GAVE TO MR. CARTO AND TO THE
 
25  GENTLEMAN NAMED MR. PATRICK FOETISCH, WHO WAS AN OVERSEAS
 
26  SWISS ATTORNEY.  THE EVIDENCE WILL SHOW THAT IS EXACTLY WHAT
 
27  OCCURRED.  THE EVIDENCE WILL SHOW THERE WAS A CORPORATION
 
28  CALLED VIBET, WHICH WAS SET UP FOR THIS PURPOSE, SO THAT THE
			
			

page  40
 
 
 
 1  MONIES WOULD NOT COME IN — CONSISTENT TO WHAT
 
 2  MR. MARCELLUS TALKED ABOUT IN THE 1985 LETTER TO JEAN
 
 3  FARREL-EDISON, DO NOT HAVE THE MONIES COME IN TO THIS TO THE
 
 4  LEGION FOR THE BENEFIT OF OUR ENEMIES.  THAT’s WHAT THE
 
 5  EVIDENCE WILL SHOW.
 
 6            THE EVIDENCE WILL ALSO SHOW SOME TIME SHORTLY
 
 7  THEREAFTER MR. CARTO INFORMED LEWIS AND LAVONNE FURR AND
 
 8  THEY WILL TESTIFY AND HAVE TESTIFIED AT DEPOSITION THEY WERE
 
 9  INFORMED ABOUT THE CORPORATION.  THEY WERE INFORMED THIS HAD
 
10  TAKEN PLACE AND WHICH — AND THEY APPROVED AND RATIFIED THE
 
11  ACTIONS TAKEN BY MR. CARTO.  THEY WERE — WERE THE LEGION.
 
12  AND THE EVIDENCE WILL ALSO SHOW, APART FROM WHAT COUNSEL HAS
 
13  STATED IN THE OPENING STATEMENT, THAT THE FURRS WERE
 
14  CONSTANTLY INFORMED AS TO WHAT WAS GOING ON WITH THE
 
15  RECOVERY AND HOW IT WAS BEING DIRECTED.
 
16            THE EVIDENCE WILL ALSO SHOW, YOUR HONOR, CONTRARY
 
17  TO WHAT COUNSEL STATED IN THE OPENING STATEMENT, THAT THE
 
18  LEGION ITSELF BELIEVED THAT THE FURRS WERE THE ONLY
 
19  DIRECTORS BECAUSE THE EVIDENCE IS GOING TO SHOW IN 1993,
 
20  PRIOR TO OUSTING MR. CARTO FROM THE LEGION, THAT CERTAIN
 
21  STAFF MEMBERS, I'M SAYING NOT BOARD MEMBERS, BUT STAFF
 
22  MEMBERS, TRIED TO DETERMINE WHO THE BOARD MEMBERS WERE.  THE
 
23  EVIDENCE IS GOING TO SHOW THEY MADE A DETERMINATION THERE
 
24  WERE ONLY 3, LEWIS AND LAVONNE FURR AND TOM KERR.
 
25            BY THEIR OWN ADMISSION, THE EVIDENCE IS GOING TO
 
26  SHOW THEY CONSIDERED THE FURRS, DESPITE WHAT MINUTES MAY
 
27  SAY, AS BEING — I'M TALKING ABOUT THE INSIDERS TODAY, WHAT
 
28  WE NOW KNOW IS THE LEGION TODAY, CONSIDERED ONLY LEWIS AND
			
			

page  41
 
 
 
 1  LAVONNE FURR DIRECTORS, SO MUCH SO THAT THEY THREATENED
 
 2  LEWIS AND LAVONNE FURR, THE EVIDENCE WILL SHOW, IF THEY
 
 3  DIDN'T RESIGN, THEY MAY FACE CRIMINAL PROSECUTION AND, THE
 
 4  EVIDENCE WILL SHOW, LITERALLY SCARED THEM FROM THE POSITIONS
 
 5  AND THEY RESIGNED THROUGH THAT THREAT.  THAT’s WHAT THE
 
 6  EVIDENCE IS GOING TO SHOW.
 
 7            THE PURPOSE OF THAT SHOWING WHO THE LEGION
 
 8  DIRECTORS WERE, THE LEGION DIRECTORS WERE ALWAYS LEWIS AND
 
 9  LAVONNE FURR.  THE MEMBERS FROM 1984 FORWARD WERE WILLIS
 
10  CARTO AND LAVONNE FURR.  THOSE ARE THE INDIVIDUALS WHO THE
 
11  EVIDENCE WILL SHOW CONTROLLED THE LEGION.  THE EVIDENCE IS
 
12  GOING TO SHOW, YOUR HONOR, THAT NONE OF THIS WOULD HAVE CAME
 
13  ABOUT HAD IT NOT BEEN FOR THE EFFORTS OF MR. CARTO OR
 
14  FISCHER, BECAUSE HAD THEY NOT BEEN SUCCESSFUL, WE WOULDN'T
 
15  BE HERE.  MR. FISCHER AND MR. CARTO WERE SUCCESSFUL ON THEIR
 
16  OWN AT NO SUPPORT FROM THE LEGION OTHER THAN THE USE OF ITS
 
17  NAME IN VARIOUS COURT DOCUMENTS.
 
18            THAT’s WHAT THE EVIDENCE IS GOING TO SHOW, AND
 
19  THAT IS VERY CRITICAL WITH RESPECT TO THE ARGUMENTS THAT I
 
20  PLACED BEFORE THIS COURT IN OUR BRIEFS.  IT’s AN OLD ADAGE
 
21  THAT IF — IF IT DOESN'T PROVE GOOD, IT’s NOT MINE; BUT IF
 
22  IT PROVES GOOD, IT’s MINE.  THEY SAT BACK, AND THAT’s WHAT
 
23  THE EVIDENCE IS GOING TO SHOW, AND WAITED AND WAITED AND
 
24  WAITED UNTIL IT PROVED GOOD AND UNTIL WILLIS CARTO AND
 
25  HENRY FISCHER, AMONG OTHERS, AND INCLUDING ORGANIZATIONS
 
26  MR. CARTO CONTROLLED PUT SUBSTANTIAL RESOURCES, TIME,
 
27  EFFORT, FUNDS TO DO THIS.  NOW THEY CLAIM THAT THEY'RE
 
28  ENTITLED TO IT ALL.
			
			

page  42
 
 
 
 1            UNFORTUNATELY, THAT ISN'T THE LAW.  AND THE
 
 2  EVIDENCE WILL ALSO SHOW, YOUR HONOR, ONE FINAL POINT, THAT
 
 3  HAD LEWIS AND LAVONNE FURR AGREED TO COMMIT RESOURCES OF THE
 
 4  LEGION BACK IN 1985, 1986, 1987, 1988, 1989, THE RESOURCES
 
 5  NECESSARY TO DO THIS, NOT ONLY WOULD THE ATTORNEY GENERAL BE
 
 6  ON THEIR BACK FOR VIOLATING CALIFORNIA NONPROFIT LAW, BUT
 
 7  REST ASSURED, AS I POINT OUT IN THE BRIEF, AS THE SUN WILL
 
 8  RISE TOMORROW, THE SAME INSIDERS WOULD HAVE BEEN SUING LEWIS
 
 9  AND LAVONNE FURR FOR NEGLIGENCE AND MALFEASANCE IN ALLOWING
 
10  THE LEGION TO PUT UP MONEY IT DIDN'T HAVE.
 
11            AS A FINAL WORD, YOUR HONOR, WHAT THIS LITIGATION
 
12  IS ALL ABOUT IS NOT THE JEAN FARREL-EDISON ESTATE.  THE
 
13  EVIDENCE WILL SHOW IT’s MERELY AN ADDITIONAL POWER PLAY BY
 
14  PARTIES INSIDE TO CONTINUE TO CONTROL THE LEGION AND TRY TO
 
15  WIN ONE LAWSUIT THAT MAY GIVE THEM A FEATHER UP IN THEIR
 
16  CONTINUAL CONTROL, ABSENT SOME SORT OF — ABSENT THE
 
17  LITIGATION IN HOUSTON, WHICH WILL MAKE THAT DETERMINATION.
 
18  THAT’s ALL THIS LITIGATION IS ABOUT.
 
19            WE BELIEVE THAT THE EVIDENCE WILL SHOW THAT THE
 
20  DEFENDANTS ARE ENTITLED TO JUDGMENT ON THIS ISSUE.  WE
 
21  BELIEVE THAT THE EVIDENCE SHOWS THAT THE — THE STATUTE OF
 
22  LIMITATIONS HAS RUN ON THE CLAIMS OF THE PLAINTIFF.  AND IN
 
23  ANY EVENT — AND THAT THERE IS NO MERIT TO ANY OF THE
 
24  CLAIMS WAGED IN THE COMPLAINT.
 
25       THE COURT:  ONE QUESTION AND I THINK I WILL TAKE A
 
26  BREAK.  ARE YOU SAYING THAT THE LAW IS THAT THE
 
27  INCORPORATORS OF A CORPORATION, AFTER THE BOARD OF DIRECTORS
 
28  HAVE BEEN ELECTED, THEY STILL RETAIN A SUPERIOR POWER TO THE
			
			

page  43
 
 
 
 1  BOARD OF DIRECTORS?
 
 2       MR. WAIER:  MEMBERS DO.  AND IN NONPROFIT
 
 3  CORPORATIONS — THIS IS NOT A FOR-PROFIT CORPORATION.
 
 4  WE'RE TALKING ABOUT A NONPROFIT CORPORATION AND WHERE YOU
 
 5  HAVE TIERS OF CONTROL.
 
 6       THE COURT:  IS IT YOUR LEGAL THEORY OR — THAT SINCE
 
 7  YOUR CLIENT WAS AN INCORPORATOR OF THE CORPORATION, THAT HE
 
 8  TODAY RETAINS — I DON'T WANT TO HEAR FROM YOU, SIR.  YOU
 
 9  HAVE A GOOD ATTORNEY — HE RETAINS POWER SUPERIOR TO THE
 
10  BOARD OF DIRECTORS TODAY?  THAT’s WHAT THE ARGUMENT SEEMS TO
 
11  BE.
 
12       MR. WAIER:  YES, IT IS.  THAT’s AN ISSUE IN HOUSTON AND
 
13  WILL BE DETERMINED NOVEMBER 8.  THAT WHOLE ISSUE IS BEFORE
 
14  THE COURT, WHICH WAS NOT DECIDED BY JUDGE POLIS, BY THE
 
15  WAY.
 
16       THE COURT:  TAKE A BREAK HERE.  10 MINUTES.
 
17
 
18                   (PROCEEDINGS RECESSED.)
 
19
 
20       MR. WAIER:  A COUPLE OF PRELIMINARY MATTERS BEFORE WE
 
21  START.  ONE, CAN WE HAVE SOME SORT OF — AND SAME THING
 
22  WILL BE WITH US WITH MARK LANE.  CAN WE HAVE SOME SORT OF A
 
23  PROCEDURE WHEREBY WE DON'T HAVE BOTH COUNSEL OBJECTING TO
 
24  QUESTIONS?  THAT ONE BE DESIGNATED PER WITNESS TO OBJECT?
 
25       MR. BEUGELMANS:  SO STIPULATED.  THAT WILL BE
 
26  RECIPROCAL.
 
27       MR. WAIER:  YES.  THE OTHER ISSUE, ALL WITNESSES BE
 
28  EXCLUDED FROM THE COURTROOM EXCEPT PARTIES AND THAT THE
			
			

page  44
 
 
 
 1  LEGION DESIGNATED WHO THE REPRESENTATIVE IS FOR PURPOSES OF
 
 2  BEING IN HERE?
 
 3       THE COURT:  I USUALLY GRANT THAT MOTION.  DO YOU WANT
 
 4  TO DESIGNATE?
 
 5       MR. BEUGELMANS:  YES, I THINK WITH THE CAVEAT WE SHOULD
 
 6  NOT BE BOUND TO HAVE THE SAME REPRESENTATIVE HERE EVERY
 
 7  DAY.  FOR TODAY, YOUR HONOR, WE WILL DESIGNATE MR. MARK
 
 8  WEBER TO BE THE REPRESENTATIVE.  OTHER DAYS, WE SHOULD HAVE
 
 9  DISCRETION TO HAVE OTHER REPRESENTATIVES OF THE CORPORATION.
 
10       THE COURT:  WELL, THAT WOULD BE ALL RIGHT AS LONG AS
 
11  THAT WITNESS HAS ALREADY TESTIFIED.
 
12       MR. BEUGELMANS:  CORRECT.  VERY WELL.
 
13       THE COURT:  ABOUT — ABOUT THE STATEMENT OF DECISION,
 
14  WHAT I USUALLY DO IS EITHER ANNOUNCE IT ORALLY AND IT
 
15  BECOMES FINAL IF YOU DON'T OBJECT WITHIN 15 DAYS.  I SUSPECT
 
16  THIS IS A CASE I WILL HAVE TO SIT DOWN AND WRITE IT OUT.
 
17  AND WHAT I USUALLY DO IS SEND IT OUT AND IT BECOMES FINAL
 
18  WITHIN 15 DAYS OF MAILING UNLESS OBJECTED TO.
 
19       MR. WAIER:  IF IT’s CONDUCIVE TO THE COURT, UPON
 
20  COMPLETION OF THE CASE, I KNOW CASES SIMILAR TO THIS WHERE
 
21  IT’s STRICTLY A BENCH TRIAL, THAT THE COURT SOMETIMES
 
22  REQUESTED ADDITIONAL BRIEFS AND SUPPLEMENTAL BRIEFING FOR
 
23  THE LAW OR THE LEGAL ISSUES.
 
24       THE COURT:  I WILL ONLY IF I REALLY THINK I NEED IT.  I
 
25  DON'T DO IT TO AVOID MAKING A DECISION AND TELLING SOMEONE
 
26  THAT’s MY DECISION.
 
27            WOULD THE PLAINTIFF LIKE TO CALL A WITNESS.
 
28       MR. BEUGELMANS:  THE PLAINTIFF WILL CALL DEFENDANT
			
			

page  45
 
 
 
 1  WILLIS CARTO UNDER 776 OF THE EVIDENCE CODE.
 
 2       MR. WAIER:  WILLIS CARTO IS NOT HERE RIGHT NOW.
 
 3       THE COURT:  WHERE DID HE GO?
 
 4       MR. WAIER:  HE HAD TO GO BACK.  EVERY THURSDAY IS A
 
 5  DEADLINE FOR THE PAPER BACK EAST.  HE HAS TO GO BACK FOR
 
 6  EDITORIALIZING.  WE HAVE NOT BEEN NOTICED FOR HIM TO BE
 
 7  HERE.
 
 8       MR. BEUGELMANS:  THERE WAS A DEMAND FOR HIM TO BE
 
 9  PRESENT IN TRIAL.
 
10       THE COURT:  HE’s NOT HERE.  THERE’s NOT MUCH I CAN DO
 
11  EXCEPT NOT BE HAPPY.
 
12       MR. BEUGELMANS:  COULD WE HAVE HIM ORDERED BACK AT
 
13  1:30?  WE CAN FILL TIME.
 
14       MR. WAIER:  HE'LL BE BACK AT 1:30.  HE’s HERE IN THE
 
15  LOCAL AREA.  HE HAS FAXES COMING OVER.  HE HAS TO DO
 
16  EDITORIAL AND SO FORTH.  THAT’s THE REASON WHY.  THURSDAY IS
 
17  A DEADLINE.  AND THIS SIDE KNOWS IT TOO.
 
18       THE COURT:  YOU WANT TO PUT ON A WITNESS FROM NOW UNTIL
 
19  12:00?
 
20       MR. BEUGELMANS:  YES, WITH THE UNDERSTANDING THAT THAT
 
21  WITNESS COULD BE TAKEN OUT OF ORDER.
 
22       THE COURT:  CERTAINLY.
 
23       MR. BEUGELMANS:  WE CALL THOMAS MARCELLUS.
 
24
 
25                        THOMAS MARCELLUS,
 
26  CALLED AS A WITNESS ON BEHALF OF THE PLAINTIFF, HAVING BEEN
 
27  FIRST DULY SWORN, TESTIFIED AS FOLLOWS:
 
28                       DIRECT EXAMINATION
			
			

page  46
 
 
 
 1       MR. WAIER:  YOUR HONOR, I WOULD LIKE, FOR PURPOSES OF
 
 2  THIS, TO SEE THIS NOTICE MR. CARTO HAD TO BE HERE TODAY.
 
 3       THE COURT:  I'M NOT GOING TO GET INVOLVED IN THAT.
 
 4  HE’s GOING TO BE HERE ONE WAY OR THE OTHER.  THAT’s NOT MY
 
 5  ISSUE.  GO WITH MR. THOMAS MARCELLUS.
 
 6       THE CLERK:  STATE YOUR FULL NAME AND SPELL YOUR LAST
 
 7  FOR THE RECORD.
 
 8       THE WITNESS:  THOMAS JAMES MARCELLUS.
 
 9  M-A-R-C-E-L-L-U-S.
 
10
 
11  BY MR. MUSSELMAN:
 
12       Q    GOOD MORNING, MR. MARCELLUS.
 
13       A    GOOD MORNING.
 
14       Q    MY NAME IS THOMAS MUSSELMAN.
 
15       A    YES.
 
16       Q    YOU ARE FAMILIAR WITH THE LEGION FOR THE SURVIVAL
 
17  OF FREEDOM, INC.?
 
18       A    YES.
 
19       Q    WHAT IS IT?
 
20       MR. WAIER:  OBJECTION.  BEST EVIDENCE.  LACKS
 
21  FOUNDATION.
 
22       THE COURT:  OVERRULED.
 
23       THE WITNESS:  LEGION FOR THE SURVIVAL OF FREEDOM IS A
 
24  NONPROFIT CORPORATION THAT WAS FORMED IN THE 1950’s AND,
 
25  SINCE 19 — EARLY 1960, HAS OPERATED SOLELY IN CALIFORNIA.
 
26  AND IT’s ESSENTIALLY A PUBLISHER OF BOOKS, NEWSLETTERS AND
 
27  OTHER MATERIAL AND SPECIALIZES IN WHAT IS CALLED HISTORICAL
 
28  REVISIONISM, CONSTITUTIONALISM AND ISSUES DEALING WITH THE
			
			

page  47
 
 
 
 1  FOUNDATION OF THIS COUNTRY.
 
 2
 
 3  BY MR. MUSSELMAN:
 
 4       Q    ARE YOU WORKING FOR THEM NOW?
 
 5       A    I AM NOT.
 
 6       Q    HAVE YOU IN THE PAST?
 
 7       A    I DID, YES.
 
 8       Q    AND WHEN DID YOU FIRST BECOME AFFILIATED WITH
 
 9  THEM?
 
10       A    IN 1978.
 
11       Q    WHAT WAS THAT?
 
12       A    I BEGAN AS ASSISTANT DIRECTOR IN 1978.  AND THEN
 
13  IN 1981, I BECAME — I BECAME DIRECTOR OF THE ENTITIES, THE
 
14  TRADE ENTITIES, WHICH ARE I.H.R., INSTITUTE FOR HISTORICAL
 
15  REVIEW, AND THE NOONTIME PRESS.
 
16       Q    HAVE YOU HAD OTHER JOBS WHILE YOU WERE THERE?
 
17       A    I WORKED STRICTLY FOR THE LEGION FROM 1978 UNTIL
 
18  19 — LATE 1985.  I LEFT THE CORPORATION FOR 18 MONTHS TO
 
19  PURSUE OTHER INTERESTS, AND I RETURNED TO THE CORPORATION IN
 
20  JUNE OF 1987, RESUMED MY POSITION AS DIRECTOR AND CONTINUED
 
21  IN THAT POSITION UNTIL 1994.
 
22       Q    APPROXIMATELY WHAT — APPROXIMATELY WHEN IN 1994?
 
23       A    I BELIEVE IT WAS FEBRUARY WHEN I RESIGNED.
 
24       Q    AND DURING YOUR STINT AT THE LEGION, WERE YOU AN
 
25  OFFICER?
 
26       A    YES, I WAS CHIEF OPERATING OFFICER.
 
27       Q    WERE YOU EVER ALSO A DIRECTOR?
 
28       MR. WAIER:  OBJECTION.  LEADING.
			
			

page  48
 
 
 
 1       THE COURT:  OVERRULED.
 
 2       THE WITNESS:  YES, I WAS A DIRECTOR BEGINNING IN, I
 
 3  BELIEVE, 1993, LATE 1993.  AND I WAS ALSO PRESIDENT OF THE
 
 4  CORPORATION AT ABOUT THAT SAME TIME.
 
 5
 
 6  BY MR. MUSSELMAN:
 
 7       Q    ARE YOU FAMILIAR WITH AN ENTITY, FOUNDATION TO
 
 8  DEFEND THE FIRST AMENDMENT, INC.?
 
 9       A    YES.
 
10       Q    AND WHAT IS THAT?
 
11       MR. WAIER:  OBJECTION.  LACKS FOUNDATION.
 
12       THE COURT:  OVERRULED.
 
13       THE WITNESS:  FOUNDATION TO DEFEND THE FIRST AMENDMENT
 
14  IS AN ENTITY THAT OPERATES OUT OF THE LIBERTY LOBBY BUILDING
 
15  IN WASHINGTON, D.C., HAS — TO MY KNOWLEDGE AND EXPERIENCE,
 
16  HAS OPERATED OUT OF THAT BUILDING.  IT’s AN ENTITY
 
17  CONTROLLED BY WILLIS CARTO.
 
18       MR. WAIER:  MOVE TO STRIKE.  HEARSAY.  LACKS
 
19  FOUNDATION.
 
20       THE COURT:  SUSTAINED, CONTROLLED BY WILLIS CARTO.
 
21       THE WITNESS:  OKAY.
 
22       THE COURT:  NO QUESTION IS PENDING.  HE'LL ASK ANOTHER
 
23  QUESTION.
 
24
 
25  BY MR. MUSSELMAN:
 
26       Q    DID YOU HAVE ANY DEALINGS WITH THAT ENTITY WHILE
 
27  AT THE LEGION?
 
28       A    YES, I DID.
			
			

page  49
 
 
 
 1       Q    AND WHAT TYPE OF DEALINGS?
 
 2       A    THE DEALINGS I HAD WITH THE F.D.F.A. WERE DEALINGS
 
 3  THAT WERE — THAT WERE PROMPTED BY DIRECTION FROM WILLIS
 
 4  CARTO AS TO WHAT DEALINGS TO HAVE WITH THE F.D.F.A.
 
 5       MR. WAIER:  OBJECTION.  MOVE TO STRIKE AS BEING
 
 6  NONRESPONSIVE.  HEARSAY.  LACKS FOUNDATION.  COMPETENT.
 
 7       THE COURT:  OVERRULED.
 
 8
 
 9  BY MR. MUSSELMAN:
 
10       Q    WHAT TYPE OF DIRECTION, IN REFERENCE TO FOUNDATION
 
11  TO DEFEND THE FIRST AMENDMENT, ARE YOU TALKING ABOUT?
 
12       MR. WAIER:  OBJECTION.  HEARSAY.
 
13       THE COURT:  OVERRULED.
 
14       THE WITNESS:  FOR EXAMPLE, APPROXIMATELY 1984, LATE
 
15  1984, '85, CARTO ASKED ME — I'M SORRY.  EARLIER THAN 1984,
 
16  CARTO ASKED ME TO HAVE --
 
17       MR. WAIER:  OBJECTION.  MOVE TO STRIKE.  CALLS FOR
 
18  HEARSAY.
 
19       MR. MUSSELMAN:  YOUR HONOR, MAY I HAVE AN INSTRUCTION
 
20  THAT THE ATTORNEY NOT INTERRUPT THE WITNESS, LET HIM
 
21  COMPLETE THE RESPONSE BEFORE THE OBJECTION IS MADE.
 
22       THE COURT:  HE SHOULD PROBABLY INTERRUPT THE WITNESS
 
23  BEFORE THE WITNESS TESTIFIES; OTHERWISE, I HAVE TO FORGET I
 
24  HEARD THE ANSWER.  OVERRULE THE OBJECTION.
 
25       THE WITNESS:  AS I WAS SAYING, AN EXAMPLE WAS IN 1984,
 
26  MR. CARTO DIRECTED ME TO HAVE CERTAIN CONTRIBUTORS TO THE
 
27  LEGION DIRECT THEIR CONTRIBUTIONS TO THE F.D.F.A. INSTEAD OF
 
28  THE LEGION.
			
			

page  50
 
 
 
 1  BY MR. MUSSELMAN:
 
 2       Q    DID HE SAY WHY?
 
 3       MR. WAIER:  OBJECTION.  HEARSAY.
 
 4       THE COURT:  OVERRULED.
 
 5       THE WITNESS:  YES.  HE SAID THAT BECAUSE WE WERE --
 
 6  THE LEGION WAS INVOLVED IN LITIGATION AT THAT TIME, AND IN
 
 7  THE CASE OF AN ADVERSE JUDGMENT, MR. CARTO DID NOT WANT THE
 
 8  MONEY IN THE LEGION’s ACCOUNTS.
 
 9
 
10  BY MR. MUSSELMAN:
 
11       Q    ARE YOU FAMILIAR WITH LIBERTY LOBBY, INC.?
 
12       A    YES.
 
13       Q    AND DID YOU HAVE DEALINGS WITH THAT ENTITY WHILE
 
14  YOU WERE AT THE LEGION?
 
15       A    YES.
 
16       MR. WAIER:  OBJECTION.  VAGUE AND AMBIGUOUS TO THE TERM
 
17  “DEALINGS."
 
18       THE COURT:  OVERRULED.
 
19
 
20  BY MR. MUSSELMAN:
 
21       Q    WHAT TYPE OF DEALINGS DID YOU HAVE WITH THEM?
 
22       MR. WAIER:  OBJECTION.  CALLS FOR A NARRATIVE.
 
23       THE COURT:  OVERRULED.
 
24       THE WITNESS:  THERE WERE OCCASIONS WHEN LIBERTY LOBBY
 
25  WOULD BUY BOOKS FROM THE LEGION, AND THERE WERE OCCASIONS
 
26  WHERE THE LEGION WOULD PURCHASE BOOKS FROM LIBERTY LOBBY.
 
27  THERE WERE OCCASIONS WHEN SOMEONE WORKING WITH ME AT THE
 
28  LEGION WROTE AN ARTICLE THAT WAS PUBLISHED IN LIBERTY
			
			

page  51
 
 
 
 1  LOBBY’s PUBLICATION, THE SPOTLIGHT.  THERE WERE FAXES AND
 
 2  OTHER DOCUMENTS THAT CAME — THAT TYPICALLY AND REGULARLY
 
 3  CAME THROUGH THE LEGION EN ROUTE TO MR. CARTO.  OFTENTIMES,
 
 4  I HAD TO — IF FAX TRANSMISSION WAS BAD, I HAD TO CALL
 
 5  LIBERTY LOBBY AND SAY YOU HAVE TO REFAX THIS BECAUSE IT WAS
 
 6  GARBLED IN THE TRANSMISSION.
 
 7
 
 8  BY MR. MUSSELMAN:
 
 9       Q    DID MR. CARTO TELL YOU WHAT HIS CONNECTION WITH
 
10  LIBERTY LOBBY WAS?
 
11       A    YES.
 
12       Q    WHAT WAS THAT?
 
13       A    HE SAID THAT HE WAS TREASURER AND THAT HE WAS
 
14  FOUNDER ALSO.
 
15       Q    DID YOU EVER HAVE COMMUNICATION WITH LIBERTY LOBBY
 
16  OTHER THAN THROUGH MR. CARTO?
 
17       A    I DID, YES.
 
18       Q    DID YOU EVER HAVE ANY DEALINGS WITH FOUNDATION TO
 
19  DEFEND THE FIRST AMENDMENT OTHER THAN THROUGH MR. CARTO?
 
20       A    NO.
 
21       Q    WHILE YOU WERE IN THE LEGION, DID YOU EVER LEARN
 
22  WHETHER THE FOUNDATION TO DEFEND THE FIRST AMENDMENT HAD ANY
 
23  EMPLOYEES?
 
24       MR. WAIER:  OBJECTION.  CALLS FOR HEARSAY.  LACKS
 
25  FOUNDATION.
 
26       THE COURT:  I'M GOING TO SUSTAIN THE OBJECTION.  IF YOU
 
27  CAN SET A FOUNDATION HE HEARD FROM MR. CARTO, I'LL OVERRULE
 
28  IT.
			
			

page  52
 
 
 
 1  BY MR. MUSSELMAN:
 
 2       Q    HAVE YOU EVER HEARD FROM MR. CARTO WHETHER
 
 3  FOUNDATION TO DEFEND THE FIRST AMENDMENT HAD ANY EMPLOYEES?
 
 4       A    NO.
 
 5       Q    HAVE YOU EVER HAD ANY DEALINGS WITH ANYONE OTHER
 
 6  THAN MR. CARTO WHEN YOU WERE DEALING WITH THE FOUNDATION TO
 
 7  DEFEND THE FIRST AMENDMENT?
 
 8       A    I BELIEVE I ANSWERED THAT.  NO.
 
 9       Q    HAVE YOU EVER MET MR. Carto’s WIFE ELISABETH?
 
10       A    YES.
 
11       Q    AND DO YOU KNOW WHERE THE CARTOS RESIDE?
 
12       A    YES.
 
13       Q    WHERE IS THAT?
 
14       A    IT’s EAST OF HERE.
 
15       MR. WAIER:  OBJECTION.  RELEVANCY.
 
16       THE COURT:  YES.  WHAT IS THE RELEVANCE?
 
17       MR. MUSSELMAN:  THE JURISDICTION, I'M DECIDING WHAT IS
 
18  THE BASIC FOUNDATION.
 
19       THE COURT:  SUSTAIN THE OBJECTION.  IT’s NOT AN ISSUE.
 
20
 
21  BY MR. MUSSELMAN:
 
22       Q    ARE YOU FAMILIAR WITH AN ENTITY THE VIBET,
 
23  V-I-B-E-T?
 
24       A    YES.
 
25       Q    IS YOUR FAMILIARITY BASED UPON YOUR STINT AT THE
 
26  LEGION?
 
27       A    YES.
 
28       Q    DID YOU EVER HAVE ANY CONVERSATIONS WITH MR. CARTO
			
			

page  53
 
 
 
 1  ABOUT VIBET WHILE AT THE LEGION?
 
 2       A    YES.
 
 3       Q    AND CAN YOU RECALL ANY OF THOSE CONVERSATIONS?
 
 4       MR. WAIER:  OBJECTION.  HEARSAY.
 
 5       THE COURT:  OVERRULED.
 
 6       THE WITNESS:  YES.  THE DISCUSSIONS WERE THAT --
 
 7       MR. WAIER:  OBJECTION, MOVE TO STRIKE AS NONRESPONSIVE
 
 8  EVERYTHING AFTER “YES."
 
 9       THE COURT:  OVERRULED.
 
10       THE WITNESS:  THE DISCUSSIONS INVOLVED Carto’s
 
11  COMMUNICATING TO — MR. CARTO COMMUNICATING TO ME THAT
 
12  VIBET OR — VIBET WAS AN ENTITY SET UP TO HOLD THE LEGION'S
 
13  ASSETS RESULTING FROM THE SETTLEMENT OF THE FARREL ESTATE
 
14  BUSINESS IN EUROPE.
 
15
 
16  BY MR. MUSSELMAN:
 
17       Q    AND WHEN YOU SAY “FARREL ESTATE BUSINESS,” WHAT DO
 
18  YOU MEAN?
 
19       A    I MEAN, THE PROCEEDS FROM THE SETTLEMENT OF THOSE
 
20  CASES WHERE THEY TOOK PLACE IN EUROPE AND ENGLAND AND HERE.
 
21       Q    DID YOU EVER HAVE DISCUSSIONS WITH MR. CARTO ABOUT
 
22  WHAT THE LITIGATION ENTAILED?
 
23       A    NOT IN DETAIL.
 
24       Q    DID HE TELL YOU WHO THE PLAINTIFF IN LITIGATION
 
25  WAS?
 
26       A    YES.
 
27       Q    WHAT DID HE SAY?
 
28       A    LEGION.
			
			

page  54
 
 
 
 1       MR. WAIER:  OBJECTION.  CALLS FOR DOUBLE HEARSAY.
 
 2       THE COURT:  OVERRULED.
 
 3       MR. BEUGELMANS:  IS THERE AN ANSWER?
 
 4       THE WITNESS:  THE LEGION.
 
 5
 
 6  BY MR. MUSSELMAN:
 
 7       Q    ARE YOU FAMILIAR WITH SOMEONE NAMED PATRICK
 
 8  FOETISCH, F-O-E-T-I-S-C-H?
 
 9       A    I'M FAMILIAR WITH THE NAME.
 
10       Q    HAVE YOU HAD DISCUSSIONS WITH MR. CARTO ABOUT
 
11  MR. FOETISCH?
 
12       A    I HAVE NOT.
 
13       Q    ARE YOU FAMILIAR WITH AN ENTITY, INTERNATIONAL
 
14  LEGION FOR THE SURVIVAL OF FREEDOM?
 
15       A    IN NAME ONLY.
 
16       Q    HAVE YOU EVER HAD ANY COMMUNICATION WITH MR. CARTO
 
17  ABOUT THAT ENTITY?
 
18       A    NO.
 
19       Q    HAVE YOU HAD ANY COMMUNICATION WITH MRS. CARTO
 
20  ABOUT THAT ENTITY?
 
21       A    NO.
 
22       MR. MUSSELMAN:  IF I COULD SHOW THE WITNESS SOME
 
23  EXHIBITS.
 
24       THE COURT:  YES, ANYTIME.
 
25       MR. MUSSELMAN:  I HAVE THE ORIGINALS.
 
26
 
27  BY MR. MUSSELMAN:
 
28       Q    LOOK AT EXHIBIT 1.  TELL ME WHAT YOU RECOGNIZE IT
			
			

page  55
 
 
 
 1  TO BE.
 
 2       A    I DO.
 
 3       Q    AND WHEN DID YOU SEE IT?
 
 4       A    I BELIEVE I SAW THIS FIRST IN 1993.
 
 5       Q    UNDER WHAT CIRCUMSTANCES WAS THAT?
 
 6       A    IT WAS DURING THE COURSE OF AN INVESTIGATION BY
 
 7  THE STAFF AT THE LEGION TO DETERMINE MR. Carto’s LEGAL
 
 8  STANDING WITH THE CORPORATION.
 
 9       Q    WHERE DID YOU FIND THE DOCUMENT?
 
10       A    THE DOCUMENT, I RECALL, WAS IN THE --
 
11       MR. WAIER:  OBJECTION.  LACKS FOUNDATION.
 
12       THE COURT:  OVERRULED.
 
13       THE WITNESS:  IT WAS IN THE LEGION’s FILES.
 
14
 
15  BY MR. MUSSELMAN:
 
16       Q    DID YOU EVER HAVE ANY DISCUSSIONS WITH MR. CARTO
 
17  ABOUT EXHIBIT 1?
 
18       A    NO.  THIS DOCUMENT WAS DISCOVERED AFTER HE HAD --
 
19       MR. WAIER:  I MOVE TO STRIKE AFTER THE WORD “NO."
 
20       THE COURT:  SUSTAINED.
 
21
 
22  BY MR. MUSSELMAN:
 
23       Q    OTHER THAN EXHIBIT 1, HAVE YOU SEEN ANY OTHER
 
24  DOCUMENT THAT PURPORTS TO BE ARTICLES OF INCORPORATION OF
 
25  THE LEGION?
 
26       A    NO.
 
27       Q    OTHER THAN EXHIBIT 1, HAVE YOU SEEN ANY DOCUMENT
 
28  THAT PURPORTS TO BE A CHARTER OF THE LEGION?
			
			

page  56
 
 
 
 1       A    NO.
 
 2       Q    BEFORE YOU LEFT THE LEGION, DID YOU EVER HAVE
 
 3  DISCUSSIONS WITH MR. CARTO WHERE MR. CARTO TOLD YOU HE WAS
 
 4  AN INCORPORATOR OF THE LEGION?
 
 5       MR. WAIER:  OBJECTION.  LEADING QUESTION.
 
 6       THE COURT:  OVERRULED.
 
 7       THE WITNESS:  NO.
 
 8
 
 9  BY MR. MUSSELMAN:
 
10       Q    DID YOU EVER HAVE ANY DISCUSSIONS, BEFORE YOU
 
11  LEFT, WITH HIM WHERE HE CLAIMED HE WAS A MEMBER OF THE
 
12  LEGION?
 
13       MR. WAIER:  OBJECTION.  LEADING.
 
14       THE COURT:  OVERRULED.
 
15       THE WITNESS:  NO.
 
16
 
17  BY MR. MUSSELMAN:
 
18       Q    WHEN YOU LEFT, DID YOU EVER HAVE ANY DISCUSSION
 
19  WITH HIM WHERE HE CLAIMED THAT LAVONNE OR LEWIS FURR WERE
 
20  MEMBERS OF THE LEGION?
 
21       MR. WAIER:  OBJECTION.  LEADING.
 
22       THE COURT:  OVERRULED.
 
23       THE WITNESS:  NO
 
24
 
25  BY MR. MUSSELMAN:
 
26       Q    OR THAT THEY WERE INCORPORATORS OF THE LEGION?
 
27       MR. WAIER:  OBJECTION.  LEADING.
 
28       THE COURT:  OVERRULED.
			
			

page  57
 
 
 
 1       THE WITNESS:  NO.
 
 2
 
 3  BY MR. MUSSELMAN:
 
 4       Q    HAVE YOU MET LAVONNE FURR?
 
 5       A    YES.
 
 6       Q    HAVE YOU MET LEWIS FURR?
 
 7       A    YES.
 
 8       Q    AND ARE THEY MARRIED?
 
 9       MR. WAIER:  OBJECTION.  LACKS FOUNDATION.
 
10
 
11  BY MR. MUSSELMAN:
 
12       Q    DID THEY TELL YOU THEY WERE MARRIED?
 
13       THE COURT:  OVERRULED.
 
14       THE WITNESS:  THEY DID NOT TELL ME THEY WERE MARRIED.
 
15
 
16  BY MR. MUSSELMAN:
 
17       Q    HAS MR. CARTO TOLD YOU THEY WERE MARRIED?
 
18       A    YES.
 
19       Q    WHEN DID YOU FIRST HAVE DEALINGS WITH THEM?
 
20       A    I FIRST MET LAVONNE FURR IN 1978 WHEN I CAME TO
 
21  WORK FOR THE CORPORATION.
 
22       Q    AND DID YOU HAVE ANY DISCUSSIONS WITH HER THEN
 
23  ABOUT HER ROLE AT THE LEGION?
 
24       A    NO.
 
25       Q    DID YOU HAVE ANY DISCUSSIONS WITH MR. CARTO ABOUT
 
26  HER ROLE AT THE LEGION?
 
27       A    YES.
 
28       Q    WHAT DID HE TELL YOU?
			
			

page  58
 
 
 
 1       MR. WAIER:  OBJECTION.  HEARSAY.
 
 2       THE COURT:  OVERRULED.
 
 3       THE WITNESS:  HE INDICATED THAT LAVONNE WAS AND LEWIS
 
 4  FURR WERE DIRECTORS OF THE CORPORATION.
 
 5
 
 6  BY MR. MUSSELMAN:
 
 7       Q    BETWEEN THE TIME HE TOLD YOU THAT AND THE TIME YOU
 
 8  LEFT THE LEGION, DID HE EVER TELL YOU THAT THEY HAD SOME
 
 9  ROLE OTHER THAN AS DIRECTOR?
 
10       MR. WAIER:  OBJECTION.  VAGUE AND AMBIGUOUS AS TO THE
 
11  TERM “HE."
 
12       THE COURT:  SUSTAIN THE OBJECTION UNLESS YOU UNDERSTAND
 
13  THE QUESTION.
 
14       THE WITNESS:  I DO.  AND I BELIEVE THE ANSWER IS THAT
 
15  HE DID ALSO TELL ME THEY WERE OFFICERS OF THE CORPORATION.
 
16
 
17  BY MR. MUSSELMAN:
 
18       Q    COULD YOU LOOK AT EXHIBIT 2, PLEASE.
 
19       THE COURT:  IT’s GOOD IDEA TO IDENTIFY THE EXHIBITS.
 
20       MR. MUSSELMAN:  EXHIBIT 2 IS AN UNDATED DOCUMENT
 
21  ENTITLED “BYLAWS,” COLON, “LEGION FOR THE SURVIVAL OF
 
22  FREEDOM.”  EXHIBIT 1 WAS A DOCUMENT THAT SAYS “CHARTER OF
 
23  THE LEGION FOR THE SURVIVAL OF FREEDOM."
 
24
 
25  BY MR. MUSSELMAN:
 
26       Q    HAVE YOU EVER SEEN EXHIBIT 2 BEFORE?
 
27       A    YES.
 
28       Q    WHEN WAS THAT?
			
			

page  59
 
 
 
 1       A    I BELIEVE 1989.
 
 2       Q    WHERE DID YOU SEE IT?
 
 3       A    MR. CARTO HANDED IT TO ME.
 
 4       Q    WHERE PHYSICALLY WERE YOU?
 
 5       A    AT THE OFFICES OF THE LEGION AT THAT TIME.
 
 6       Q    DID YOU EVER SEE IT THEREAFTER?
 
 7       A    YES.
 
 8       Q    WHERE ELSE HAVE YOU SEEN IT?
 
 9       A    WE KEPT IT ON FILE AT THE OFFICE.  AND I HAD THE
 
10  OPPORTUNITY TO SEE IT AGAIN IN 1993.
 
11       Q    MR. CARTO EVER HAVE ANY DISCUSSIONS WITH YOU ABOUT
 
12  IT?
 
13       A    YES.
 
14       Q    WHAT DID HE TELL YOU ABOUT IT?
 
15       A    SUBSTANCE OF THE DISCUSSION WAS THIS WAS TO BE
 
16  GIVEN TO THE ATTORNEY WHO IS REPRESENTING THE LEGION IN A
 
17  CASE THAT THE LEGION WAS, AT THAT TIME, INVOLVED IN
 
18  LITIGATION WITH.
 
19       Q    DID HE IDENTIFY WHAT IT WAS?
 
20       A    HE SAID IT — THEY WERE THE BYLAWS OF THE
 
21  CORPORATION.
 
22       Q    DID HE TELL YOU WHO DRAFTED THEM?
 
23       A    NO.
 
24       MR. MUSSELMAN:  I MOVE FOR THE ADMISSION OF EXHIBITS 1
 
25  AND 2, UNLESS YOU WANT TO WAIT UNTIL LATER.
 
26       THE COURT:  I PREFER TO DO THAT AND WAIT UNTIL YOU ARE
 
27  THROUGH WITH YOUR CASE.  THEN WE'LL DO IT AT ONE TIME.  THE
 
28  SAME WAY WITH DEFENSE.
			
			

page  60
 
 
 
 1  BY MR. MUSSELMAN:
 
 2       Q    WHILE YOU WERE AT THE LEGION, DID YOU EVER REVIEW
 
 3  THE RECORDS OF THE LEGION?
 
 4       A    YES.
 
 5       Q    DID YOU EVER REVIEW THE RECORDS TO DETERMINE WHAT
 
 6  MEETINGS HAD OCCURRED AT THE LEGION, WHAT BOARD OF DIRECTORS
 
 7  MEETING HAD OCCURRED?
 
 8       A    YES.
 
 9       Q    DID YOU REVIEW THE RECORDS TO DETERMINE WHAT
 
10  OFFICER MEETINGS HAD OCCURRED?
 
11       A    YES.
 
12       Q    IN YOUR REVIEW, DID YOU EVER COME ACROSS ANY
 
13  DOCUMENT THAT PURPORTED TO BE A MEETING OF MEMBERS OF THE
 
14  LEGION?
 
15       MR. WAIER:  OBJECTION.  CALLS FOR HEARSAY.
 
16       THE COURT:  OVERRULED.
 
17       THE WITNESS:  I NEVER SAW SUCH A DOCUMENT.
 
18
 
19  BY MR. MUSSELMAN:
 
20       Q    WHILE YOU WERE THERE, DID YOU COME ACROSS A
 
21  DOCUMENT THAT PURPORTED TO BE A MEETING OF THE INCORPORATORS
 
22  OF THE LEGION?
 
23       A    I DID NOT.
 
24       Q    DID YOU EVER COME ACROSS A DOCUMENT, WHILE YOU
 
25  WERE THERE, THAT PURPORTED TO ELECT MR. CARTO OR MRS. AND
 
26  MRS. FURR AS SUBSTITUTE INCORPORATORS OF THE LEGION?
 
27       MR. WAIER:  I AM GOING TO OBJECT NOT ONLY HEARSAY AND
 
28  COMPETENCY GROUND, LACKS FOUNDATION, BUT RELEVANCE WITH
			
			

page  61
 
 
 
 1  RESPECT TO THIS WITNESS.
 
 2       THE COURT:  OVERRULED.
 
 3       THE WITNESS:  I NEVER SAW SUCH A DOCUMENT.
 
 4
 
 5  BY MR. MUSSELMAN:
 
 6       Q    HAVE YOU EVER MET SOMEONE NAMED BRUCE HOLMAN?
 
 7       A    NO.
 
 8       Q    HAVE YOU HAD DISCUSSIONS WITH HIM?
 
 9       A    NO.
 
10       Q    IF YOU CAN TAKE A LOOK, PLEASE, AT EXHIBIT 5.  IT
 
11  STATES “MINUTES,” COMMA, “MARCH 25,” COMMA, “1966 LEGION FOR
 
12  THE SURVIVAL OF THE FREEDOM, INC."
 
13       A    I HAVE IT.
 
14       Q    DO YOU RECALL SEEING THIS BEFORE?
 
15       A    MAY I TAKE A MOMENT TO LOOK IT OVER?
 
16       Q    SURE.
 
17       A    YES, I HAVE SEEN THIS.
 
18       Q    WHEN WAS THAT?
 
19       A    1993.
 
20       Q    WHERE WERE YOU?
 
21       A    AT THE LEGION OFFICES.
 
22       Q    WHAT WERE THE CIRCUMSTANCES OF YOUR SEEING IT?
 
23       A    IT WAS IN CONJUNCTION WITH THE INVESTIGATION TO
 
24  DETERMINE MR. Carto’s STANDING WITH THE CORPORATION.
 
25       Q    WAS THE DOCUMENT IN THE LEGION OFFICES?
 
26       A    IT WAS NOT.
 
27       Q    AND WHERE WAS IT OBTAINED FROM?
 
28       A    I DON'T RECALL.
			
			

page  62
 
 
 
 1       Q    IF YOU COULD LOOK AT EXHIBIT 3, PLEASE, WHICH IS
 
 2  ENTITLED “BYLAWS, LEGION FOR THE SURVIVAL OF THE FREEDOM,
 
 3  INC."
 
 4       A    YES.
 
 5       Q    HAVE YOU SEEN THAT BEFORE?
 
 6       A    YES.
 
 7       Q    WHEN WAS THAT?
 
 8       A    1993.
 
 9       Q    WHERE WERE YOU?
 
10       A    IN THE LEGION OFFICES.
 
11       Q    WAS THIS DOCUMENT IN THE LEGION FILES?
 
12       A    IT WAS NOT.
 
13       Q    DO YOU KNOW WHERE IT WAS OBTAINED FROM?
 
14       A    I DON'T RECALL.
 
15       Q    HAVE YOU EVER HAD ANY DISCUSSION WITH MR. CARTO
 
16  ABOUT EXHIBIT 3?
 
17       A    NO.
 
18       Q    DID YOU EVER HAVE ANY DISCUSSION WITH MR. CARTO
 
19  ABOUT EXHIBIT 5?
 
20       MR. WAIER:  5?
 
21       THE COURT:  YES.
 
22       THE WITNESS:  I THINK I ANSWERED THAT I DID.  I DID
 
23  HAVE A BRIEF DISCUSSION WITH HIM ON EXHIBIT 5 WHEN HE HANDED
 
24  ME THE DOCUMENT THAT WAS TO BE GIVEN TO THE ATTORNEY IN
 
25  CONJUNCTION WITH LITIGATION.
 
26       MR. WAIER:  I'M SORRY, CAN I HAVE THAT READ BACK,
 
27  PLEASE.
 
28                     (THE RECORD WAS READ.)
			
			

page  63
 
 
 
 1       THE WITNESS:  THAT WAS MY MISTAKE.  I WAS REFERRING TO
 
 2  EXHIBIT 2.  THAT’s THE DOCUMENT THAT MR. CARTO GAVE ME.  AND
 
 3  IT WAS EXHIBIT 2, NOT EXHIBIT — NOT THIS OTHER EXHIBIT
 
 4  THAT I JUST STATED HE HAD GIVEN TO ME.  THAT WAS NOT THE
 
 5  CASE WITH THAT DOCUMENT.  I GOT THEM CONFUSED.
 
 6
 
 7  BY MR. MUSSELMAN:
 
 8       Q    DID YOU HAVE A DISCUSSION WITH MR. CARTO ABOUT
 
 9  EXHIBIT 5?
 
10       A    NO.
 
11       Q    IF YOU COULD LOOK AT EXHIBIT 4, PLEASE, WHICH
 
12  STATES “MERGER OF THE LEGION FOR THE SURVIVAL OF FREEDOM,
 
13  INC. WITH A COMMITTEE FOR RELIGIOUS DEVELOPMENT, INC."
 
14       A    YES.
 
15       Q    HAVE YOU SEEN THAT BEFORE?
 
16       A    YES.
 
17       Q    WHEN WAS THAT?
 
18       A    IN 1993.
 
19       Q    WHERE WERE YOU?
 
20       A    AT THE LEGION OFFICES.
 
21       Q    WAS THE DOCUMENT IN LEGION’s FILES?
 
22       A    AS I RECALL, IT WAS NOT.  IT HAD BEEN RECENTLY
 
23  OBTAINED.
 
24       Q    DO YOU KNOW WHERE FROM?
 
25       A    NO.
 
26       Q    DID YOU EVER HAVE ANY DISCUSSIONS WITH MR. CARTO
 
27  ABOUT EXHIBIT 4?
 
28       A    NO.
			
			

page  64
 
 
 
 1       Q    ARE YOU FAMILIAR WITH THE WOMAN NAMED JEAN FARREL,
 
 2  J-E-A-N F-A-R-R-E-L?
 
 3       A    YES.
 
 4       Q    WHEN DID YOU FIRST BECOME FAMILIAR WITH HER
 
 5  EXISTENCE?
 
 6       A    I MET HER — IT’s TOUGH TO RECALL THE EXACT TIME
 
 7  FRAME, BUT I BELIEVE IN EARLY 1984 WHEN SHE VISITED THIS
 
 8  COUNTRY.
 
 9       Q    HAD YOU TALKED TO HER ON THE PHONE BEFORE YOU MET
 
10  HER IN PERSON?
 
11       A    NO.
 
12       Q    BEFORE SHE — BEFORE YOU MET HER IN PERSON, HAD
 
13  YOU EVER DISCUSSED ANYTHING ABOUT HER WITH MR. CARTO?
 
14       A    YES.
 
15       Q    WHAT DID YOU DISCUSS ABOUT HER WITH MR. CARTO?
 
16       A    I TOLD MR. CARTO THAT SHE HAD CONTACTED THE LEGION
 
17  AND THAT SHE HAD MADE A CONTRIBUTION AND PROMISED TO MAKE
 
18  CONTINUING CONTRIBUTIONS AND THAT SHE WAS PLANNING TO VISIT
 
19  THE UNITED STATES.
 
20       MR. WAIER:  I'M GOING TO OBJECT.  THAT CALLS FOR
 
21  HEARSAY, SHE STATED AND JEAN FARREL STATED.
 
22       THE COURT:  OVERRULED.
 
23
 
24  BY MR. MUSSELMAN:
 
25       Q    WHAT DID HE SAY TO YOU ABOUT HER?
 
26       A    AT THAT POINT, IT WAS — HE SUGGESTED I JUST
 
27  SIMPLY KEEP CORRESPONDING WITH HER AND URGE HER TO MAKE
 
28  FURTHER CONTRIBUTIONS FOR THE CORPORATION.
			
			

page  65
 
 
 
 1       Q    WERE YOU WORKING FOR FOUNDATION TO DEFEND THE
 
 2  FIRST AMENDMENT AT THE TIME?
 
 3       A    I WAS NOT.
 
 4       Q    WERE YOU WORKING FOR LIBERTY LOBBY?
 
 5       A    I WAS NOT.
 
 6       Q    WOULD YOU PLEASE LOOK AT EXHIBIT 7, WHICH IS A
 
 7  DOCUMENT THAT HAS AN “X” DRAWN THROUGH IT AND THE LETTERS
 
 8  B-I-F-F-E ON THE LEFT.
 
 9       A    YES.
 
10       Q    WILL YOU LOOK AT THAT AND LET ME KNOW IF YOU
 
11  RECOGNIZE IT.
 
12       A    I BELIEVE THIS IS THE FIRST TIME I HAVE SEEN THIS.
 
13       Q    WILL YOU LOOK AT EXHIBIT 8.  STATES AT THE TOP
 
14  “JEAN FARREL,” COMMA, “E,” PERIOD, AND HAS AN ADDRESS IN
 
15  SWITZERLAND.
 
16       A    LET ME LOOK AT IT A MOMENT.  ALL RIGHT.
 
17       Q    HAVE YOU SEEN THAT BEFORE?
 
18       A    I DON'T BELIEVE SO.
 
19       Q    AT THE TIME MRS. FARREL VISITED AND YOU MET HER IN
 
20  1984, HAD YOU EVER HAD DISCUSSIONS WITH MR. CARTO ABOUT
 
21  WHETHER HE HAD MET HER?
 
22       A    IF I DID, I DON'T RECALL THEM.
 
23       Q    WOULD YOU LOOK AT EXHIBIT 6, PLEASE.  STATES
 
24  “MINUTES MARCH 5, 1985."
 
25       A    YES.
 
26       Q    HAVE YOU SEEN THAT BEFORE?
 
27       A    YES.
 
28       Q    WHEN WAS THAT?
			
			

page  66
 
 
 
 1       A    I BELIEVE I SAW THIS ALSO IN 1993.
 
 2       Q    WHERE WERE YOU?
 
 3       A    LEGION OFFICES.
 
 4       Q    WAS IT IN THE LEGION’s FILES?
 
 5       A    I CAN'T SAY IT WAS.
 
 6       Q    MEANING ONE WAY OR THE OTHER?
 
 7       A    IT CAME TO THE LEGION IN SOME WAY.  I DO NOT
 
 8  RECALL IT BEING IN A LEGION FILE, BUT I RECALL SEEING IT IN
 
 9  1993.  AND WHETHER IT CAME FROM THE LEGION FILE OR NOT, I
 
10  CAN'T SAY.
 
11       Q    HAVE YOU HAD ANY DISCUSSION WITH MR. CARTO ABOUT
 
12  EXHIBIT 6?
 
13       A    NOT ABOUT THE EXHIBIT ITSELF, NO.
 
14       Q    THERE’s A REFERENCE 4 PARAGRAPHS DOWN TO SOMEONE
 
15  NAMED MEL MERMELSTEIN.  DO YOU KNOW THAT PERSON?
 
16       A    YES.
 
17       Q    HOW DO YOU KNOW THAT PERSON?
 
18       A    HE WAS A PLAINTIFF IN 2 ACTIONS AGAINST THE
 
19  LEGION, ONE IN, I BELIEVE, 1982, AND AGAIN, I BELIEVE, IN
 
20  1987.
 
21       Q    YOU SAY A PLAINTIFF IN LITIGATION, AGAINST CERTAIN
 
22  DEFENDANTS OR --
 
23       A    WELL, THE LEGION WAS AMONG THE DEFENDANTS, YES.
 
24       Q    IN THE FIFTH PARAGRAPH DOWN, THERE’s A SENTENCE
 
25  THAT SAYS, “AMONG THE SUPPORTERS IS MISS JEAN FARREL."
 
26       MR. WAIER:  OBJECTION, YOUR HONOR.  READING FROM A
 
27  DOCUMENT THAT HAS NOT BEEN RECEIVED INTO EVIDENCE.
 
28       THE COURT:  AND THE BASIS OF THE OBJECTION?
			
			

page  67
 
 
 
 1       MR. WAIER:  HEARSAY.  THERE’s NO FOUNDATION.  THERE'S
 
 2  NO FOUNDATION FOR IT.
 
 3       MR. MUSSELMAN:  THE SENTENCE IS IN EVIDENCE.
 
 4       THE COURT:  SUSTAIN THE OBJECTION RIGHT NOW.
 
 5
 
 6  BY MR. MUSSELMAN:
 
 7       Q    DID YOU EVER HAVE ANY CONVERSATION WITH MR. CARTO
 
 8  WHERE HE TOLD YOU THAT MISS JEAN FARREL WAS A SUPPORTER OF
 
 9  THE LEGION?
 
10       A    I TOLD HIM MISS JEAN FARREL WAS A SUPPORTER OF THE
 
11  LEGION.
 
12       Q    DID YOU EVER HAVE DISCUSSIONS WITH HIM THEREAFTER
 
13  WHERE HE AGREED WITH THAT STATEMENT?
 
14       A    YES.
 
15       Q    WAS HE AT THE OFFICES — EXCUSE ME.  WHEN YOU MET
 
16  HER, WHERE PHYSICALLY DID YOU MEET HER?
 
17       A    I PHYSICALLY MET HER AT THE OFFICES ON — THEY
 
18  WERE IN TORRANCE ON 2539 237TH STREET, I BELIEVE.
 
19       Q    YOU SAY “THE OFFICES.”  WHOSE OFFICES?
 
20       A    THE LEGION OFFICES.
 
21       Q    AND WHEN WAS THE APPROXIMATE DATE?
 
22       A    IT WAS THE SPRING OF '84, AS NEAR AS I CAN RECALL,
 
23  OR MAYBE EVEN EARLIER THAN THAT.
 
24       Q    DID MR. CARTO TELL YOU THAT JEAN FARREL WAS THE
 
25  FOUNDER OF THE NECA CORPORATION?
 
26       MR. WAIER:  OBJECTION.  LACKS FOUNDATION.  CALLS FOR
 
27  HEARSAY.
 
28       THE COURT:  OVERRULED.
			
			

page  68
 
 
 
 1       THE WITNESS:  YES, HE DID MENTION THAT TO ME, YES.
 
 2
 
 3  BY MR. MUSSELMAN:
 
 4       Q    DID HE EVER TELL YOU MISS JEAN FARREL HAD CREATED
 
 5  IT FOR — EXCUSE ME, THAT SHE CREATED IT FOR THE LEGION?
 
 6       MR. WAIER:  OBJECTION.  LEADING.
 
 7       THE COURT:  OVERRULED.
 
 8       THE WITNESS:  HE TOLD ME AND ELISABETH TOLD ME THAT SHE
 
 9  HAD CREATED IT SOLELY FOR THE BENEFIT OF THE LEGION, YES.
 
10       MR. WAIER:  OBJECTION.  MOVE TO STRIKE WITH RESPECT TO
 
11  ELISABETH CARTO.  MOVE TO STRIKE.  NONRESPONSIVE.
 
12       MR. BEUGELMANS:  YOUR HONOR, ELISABETH CARTO IS ALSO A
 
13  DEFENDANT IN THE ACTION.
 
14       THE COURT:  WAIT A SECOND.  ONE AT A TIME.  IS SHE OR
 
15  IS SHE NOT?
 
16       MR. BEUGELMANS:  YES, SHE’s A DEFENDANT.  SHE HAS BEEN
 
17  SERVED AND APPEARED.
 
18       MR. WAIER:  THAT’s NOT THE QUESTION.
 
19       THE COURT:  OVERRULE THE OBJECTION.
 
20
 
21  BY MR. MUSSELMAN:
 
22       Q    DID MR. CARTO EVER TELL YOU THAT MRS. JEAN FARREL
 
23  HAD DIED?
 
24       A    YES.
 
25       Q    DID HE TELL YOU WHEN THAT OCCURRED?
 
26       A    YES.  IT WAS SHORTLY AFTER IT ACTUALLY HAPPENED IN
 
27  THE FALL.  I BELIEVE HE TOLD ME LATE SUMMER OR FALL OF '84.
 
28       Q    WOULD YOU LOOK AT EXHIBIT 10, PLEASE, WHICH SAYS
			
			

page  69
 
 
 
 1  AT THE TOP “MINUTES OF SEPTEMBER 19, 1985."
 
 2       MR. WAIER:  WHICH EXHIBIT?
 
 3       MR. MUSSELMAN:  10.
 
 4       THE WITNESS:  YES.
 
 5
 
 6  BY MR. MUSSELMAN:
 
 7       Q    HAVE YOU SEEN THAT BEFORE?
 
 8       A    YES.
 
 9       Q    WHEN WAS THAT?
 
10       A    THIS WAS ALSO IN 1993.
 
11       Q    WHERE WERE YOU?
 
12       A    AT THE LEGION OFFICES.
 
13       Q    WAS THAT IN THE LEGION’s FILES?
 
14       A    I DON'T BELIEVE THIS ONE WAS, NO.
 
15       Q    DO YOU KNOW WHERE IT CAME FROM?
 
16       A    IT CAME TO THE LEGION IN CONJUNCTION WITH THE
 
17  INVESTIGATION.
 
18       MR. WAIER:  I'M GOING TO OBJECT AS CALLING FOR
 
19  HEARSAY.  LACKS FOUNDATION TO WHERE IT CAME FROM.
 
20       THE COURT:  OVERRULED.
 
21       THE WITNESS:  CAME TO THE LEGION’s HANDS IN CONJUNCTION
 
22  WITH THE INVESTIGATION THAT THE LEGION STAFF WAS PERFORMING
 
23  TO DETERMINE MR. Carto’s LEGAL STANDING WITH THE
 
24  CORPORATION.  AND I SEE IT HERE JEAN FARREL IS — WAS WHO
 
25  SUCCUMBED ON AUGUST 11, 1985.
 
26       MR. WAIER:  MOVE TO STRIKE AS BEING NONRESPONSIVE.
 
27  HEARSAY.  LACKS FOUNDATION.
 
28       THE COURT:  NONRESPONSIVE SUSTAINED.
			
			

page  70
 
 
 
 1  BY MR. MUSSELMAN:
 
 2       Q    DO YOU KNOW WHETHER OR NOT JEAN FARREL DIED ON
 
 3  AUGUST 11, 1985?
 
 4       A    I DON'T KNOW FOR SURE THAT SHE DID.
 
 5       Q    DID MR. CARTO EVER TELL YOU?
 
 6       A    YES.  AND IT WAS '85, NOT '84 AS I PREVIOUSLY
 
 7  TESTIFIED.
 
 8       Q    DID MR. CARTO EVER TELL YOU THAT HE VISITED LUTRY,
 
 9  SWITZERLAND, WHERE MISS JEAN FARREL LIVED?
 
10       A    NO.
 
11       Q    DID HE EVER TELL YOU HE VISITED SWITZERLAND AS A
 
12  BUSINESS AGENT FOR THE LEGION?
 
13       A    YES.
 
14       Q    WHEN DID HE TELL YOU THAT?
 
15       A    IT WAS SOMETIME AROUND 1987 WHEN HE ADVISED ME HE
 
16  WAS MAKING A TRIP OVER THERE.
 
17       MR. WAIER:  I'M GOING TO OBJECT AND MOVE TO STRIKE IF I
 
18  UNDERSTAND.  MAY I HEAR THE QUESTION?
 
19                     (THE RECORD WAS READ.)
 
20       MR. WAIER:  I'M SORRY.  NEVER MIND.
 
21
 
22  BY MR. MUSSELMAN:
 
23       Q    DID MR. CARTO TELL YOU THAT THE SIGNIFICANCE OF
 
24  MISS FARREL’s DEATH WAS THAT THE CONTROL OF NECA PASSED TO
 
25  LEGION?
 
26       MR. WAIER:  OBJECTION.  LEADING.  HEARSAY.  COMPETENCE.
 
27       THE COURT:  OVERRULED.
 
28       THE WITNESS:  HE DID INDICATE THAT, YES.
			
			

page  71
 
 
 
 1  BY MR. MUSSELMAN:
 
 2       Q    DID YOU EVER HAVE DISCUSSIONS WITH HIM WHERE HE
 
 3  TALKED ABOUT WHERE ANYBODY HAD BEEN CONTESTING JEAN FARREL'S
 
 4  WILL?
 
 5       A    YES, WE HAD SEVERAL SUCH DISCUSSIONS.
 
 6       Q    WHAT DID HE TELL YOU ABOUT THAT?
 
 7       A    HE TOLD ME THAT --
 
 8       MR. WAIER:  I'M GOING TO OBJECT AS LEADING AND — NOT
 
 9  LEADING, BUT HEARSAY.
 
10       THE COURT:  OVERRULED.
 
11       THE WITNESS:  MR. CARTO TOLD ME SPECIFICALLY ON SEVERAL
 
12  OCCASIONS THAT — AND MRS. CARTO, TOO, THAT — THAT WHAT
 
13  JEAN FARREL HAD GIFTED TO THE LEGION, WHICH WAS A LARGE
 
14  GIFT, WAS BEING CONTESTED IN EUROPE; THAT IT WAS GOING TO
 
15  HAVE TO BE OPPOSED OR FOUGHT.
 
16
 
17  BY MR. MUSSELMAN:
 
18       Q    DID HE TELL YOU WHO WAS CONTESTING?
 
19       A    YES.  HE MENTIONED THE NAME JOAN ALTHAUS.
 
20       Q    DID HE TELL YOU — DISCUSS WITH YOU WHETHER THE
 
21  CONTEST INVOLVED A FIGHT OVER THE CONTROL OF NECA'S
 
22  PROPERTY?
 
23       A    NOT SPECIFICALLY.
 
24       MR. WAIER:  OBJECTION.  LEADING.
 
25       THE COURT:  OVERRULE THE ANSWER.  AND THE ANSWER CAN
 
26  STAND.
 
27            SEE YOU ALL AT 1:30.
 
28       MR. BEUGELMANS:  BEFORE WE BREAK FOR LUNCH, THERE’s A
			
			

page  72
 
 
 
 1  HOUSEKEEPING DETAIL.  THE PLAINTIFF HAS OBTAINED SEALED
 
 2  DOCUMENTS FROM THE COURT OF NORTH CAROLINA, EXHIBIT 15
 
 3  THROUGH 19.  IN THE RECORD, I WOULD LIKE TO MAKE COPIES OF
 
 4  THOSE.  WHAT COUNSEL AND I HAVE DONE IS WE KEPT THEM INTACT
 
 5  WITH THE COURT’s SEAL TO SHOW COUNSEL AND THE COURT.  I
 
 6  WOULD LIKE THE OPPORTUNITY TO SHOW COUNSEL AND YOUR HONOR
 
 7  AND MAKE DUPLICATE COPIES.  THESE ARE THE SEALED RECORDS
 
 8  FROM THE COURT IN NORTH CAROLINA, IF I COULD TAKE THESE
 
 9  APART AT LUNCH.
 
10       MR. WAIER:  I'VE NEVER SEEN THOSE.  AND THEY HAVEN'T
 
11  BEEN INTRODUCED THROUGH DISCOVERY.  WE ASKED FOR THE
 
12  DOCUMENTS.  WE MAY HAVE OBJECTIONS WITH RESPECT TO THE FACT
 
13  THEY WERE NEVER PRODUCED EVEN THOUGH WE HAD NUMEROUS
 
14  DOCUMENT REQUESTS.
 
15       MR. MUSSELMAN:  IN THE EXHIBIT BOOK --
 
16       MR. BEUGELMANS:  ALSO ATTACHED TO THE DEPOSITION
 
17  EXHIBIT --
 
18       THE COURT:  ONLY ONE AT A TIME.  GIVE THEM TO HIM, AND
 
19  IF THERE’s SOME PROBLEM, I WILL SORT IT OUT OR NOT WORRY
 
20  ABOUT IT, WHATEVER.
 
21       MR. WAIER:  YOUR HONOR, ONE OTHER HOUSEKEEPING, I
 
22  RAISED ISSUES AS TO HEARSAY.  JUST BECAUSE A PARTY IS MAKING
 
23  THE STATEMENT DOESN'T MAKE IT --
 
24       THE COURT:  COUNSEL, I MADE MY RULING.  THANK YOU VERY
 
25  MUCH.
 
26
 
27                   (PROCEEDINGS RECESSED.)
 
28
			
			

page  73
 
 
 
 1       THE COURT:  WE WERE GOING TO STOP THE TESTIMONY OF
 
 2  MR. MARCELLUS AND TAKE SOMEBODY ELSE; IS THAT CORRECT?
 
 3       MR. BEUGELMANS:  CORRECT.
 
 4       THE COURT:  GO AHEAD.
 
 5       MR. BEUGELMANS:  THE PLAINTIFF WILL CALL DEFENDANT
 
 6  WILLIS CARTO TO THE STAND.
 
 7            YOUR HONOR, THE PLAINTIFF’s SERVED ON DEFENSE
 
 8  COUNSEL A DEMAND FOR LODGEMENT OF THE ORIGINAL TRANSCRIPT OF
 
 9  MR. Carto’s DEPOSITION.  WE ASK THAT BE LODGED AT THIS
 
10  TIME.  THAT WAS SERVED AUGUST 22, 1996, UPON DEFENSE
 
11  COUNSEL.
 
12       MR. WAIER:  YOUR HONOR, WE DO NOT HAVE THE ORIGINAL
 
13  HERE.  SECOND, IT WAS SET FOR AUGUST 30TH, 1995.  SECOND,
 
14  THE PROOF OF SERVICE SAYS IT WAS SERVED BY MAIL AS OF
 
15  AUGUST 22ND, WHICH MEANS WE HAVE 5 DAYS FOR MAILING, WHICH
 
16  MEANS IT’s UNTIMELY.  YOU HAVE TO HAVE 5 DAYS TO MAKE THE
 
17  DEMAND BEFORE TRIAL FROM THE FIRST FILE DATE.  THAT IS
 
18  UNTIMELY.
 
19       THE COURT:  WHAT IS THE PROBLEM HERE?  YOU WANT TO
 
20  CROSS-EXAMINE HIM ON HIS DEPOSITION, RIGHT?
 
21       MR. BEUGELMANS:  YES.  WE DEMANDED HE LODGE THE
 
22  ORIGINAL TRANSCRIPT FOR TRIAL.  HE HASN'T BROUGHT IT TO
 
23  COURT TODAY.
 
24       THE COURT:  WAS --
 
25       MR. WAIER:  WE HAD THE ORIGINAL HERE ON AUGUST 30.  IT
 
26  DOESN'T MATTER.  WE DO NOT WAIVE THE RIGHTS THAT THE DEMAND
 
27  WAS UNTIMELY.
 
28       THE COURT:  ALL THE RULES ARE REALLY FOR ASCERTAINMENT
			
			

page  74
 
 
 
 1  OF THE TRUTH, NOT JUST FOOLING AROUND.  WERE YOU PRESENT
 
 2  WHEN HIS DEPOSITION WAS TAKEN?
 
 3       MR. WAIER:  I BELIEVE I WAS PRESENT FOR — ON
 
 4  OCTOBER 17TH, I THINK IT WAS.  I WAS THERE, YES.
 
 5       THE COURT:  THAT’s THIS YEAR OR LAST YEAR?
 
 6       MR. BEUGELMANS:  1995, YOUR HONOR.
 
 7       THE COURT:  OKAY.  GO AHEAD AND CALL HIM.  YOU MAY NOT
 
 8  NEED IT.  WHO KNOWS.  IF YOU DO, I'LL PROBABLY OVERRULE THE
 
 9  OBJECTION.
 
10       MR. BEUGELMANS:  THANK YOU.
 
11
 
12                      WILLIS ALLYSON CARTO,
 
13  CALLED AS A WITNESS UNDER EVIDENCE CODE 776, HAVING BEEN
 
14  FIRST DULY SWORN, TESTIFIED AS FOLLOWS:
 
15                       CROSS EXAMINATION
 
16       THE CLERK:  WOULD YOU PLEASE STATE YOUR FULL NAME AND
 
17  SPELL YOUR LAST FOR THE RECORD.
 
18       THE WITNESS:  WILLIS ALLYSON CARTO, C-A-R-T-O.
 
19
 
20  BY MR. BEUGELMANS:
 
21       Q    MR. CARTO, ARE YOU CURRENTLY EMPLOYED?
 
22       A    AM I CURRENTLY WHAT?
 
23       Q    EMPLOYED.
 
24       A    YES.
 
25       Q    WHAT IS YOUR EMPLOYMENT, SIR?
 
26       A    I AM CHIEF EXECUTIVE OFFICER AND TREASURER OF
 
27  LIBERTY LOBBY, INCORPORATED.
 
28            EXCUSE ME, IF I MAY MAKE A STATEMENT FOR THE
			
			

page  75
 
 
 
 1  RECORD.  I JUST TALKED TO MR. MARK LANE, COUNSEL FOR LIBERTY
 
 2  LOBBY, AND HE HAS ASKED ME TO ASK THAT I BE EXCUSED FROM
 
 3  ANSWERING QUESTIONS ABOUT LIBERTY LOBBY UNTIL HE GETS HERE
 
 4  ON MONDAY.
 
 5       THE COURT:  I MIGHT DO THAT.  I MIGHT DO THAT.  THE
 
 6  WHOLE IDEA WAS WE WOULD PROBABLY START ON MONDAY WITH THE
 
 7  EVIDENCE.  WE CAN FILL IT IN WITH OTHER THINGS.
 
 8       MR. BEUGELMANS:  I WILL TRY TO.  I'LL STAY AWAY FROM
 
 9  THOSE QUESTIONS.
 
10
 
11  BY MR. BEUGELMANS:
 
12       Q    SIR, DO YOU HAVE ANY OTHER EMPLOYMENT OTHER THAN
 
13  BEING CHIEF EXECUTIVE OFFICER AND TREASURER FOR LIBERTY
 
14  LOBBY AT THE PRESENT TIME?
 
15       A    I'M INVOLVED IN MANY, MANY THINGS.  DESCRIBE
 
16  “EMPLOYMENT."
 
17       Q    DO YOU CURRENTLY CONSIDER YOURSELF TO BE A
 
18  DIRECTOR OF THE PLAINTIFF IN THIS ACTION?
 
19       A    I AM A MEMBER AND A DIRECTOR AND THE PRESIDENT,
 
20  BUT I RECEIVE NO COMPENSATION.
 
21       Q    AND WHAT IS A MEMBER AS YOU UNDERSTAND IT, SIR?
 
22       A    A MEMBER IS, IT WOULD — WAS REQUIRED BY THE
 
23  NONPROFIT CORPORATION CODE OF THE STATE OF TEXAS.  AND I
 
24  HAVE BEEN A MEMBER AND A SUBSTITUTE INCORPORATOR OF THE
 
25  LEGION FOR SURVIVAL OF FREEDOM SINCE 1966, BUT I HAVE NOT
 
26  RECEIVED COMPENSATION.
 
27       Q    WHAT AUTHORITY, IF ANY, DOES A MEMBER OF PLAINTIFF
 
28  HAVE IN YOUR UNDERSTANDING?
			
			

page  76
 
 
 
 1       A    MEMBERS HAVE THE SOLE RIGHT TO ELECT DIRECTORS.
 
 2       Q    YOU HAVE ANY OTHER AUTHORITY?
 
 3       A    TO TERMINATE DIRECTORS.
 
 4       Q    ANYTHING ELSE?
 
 5       A    IN ESSENCE, TO RUN THE CORPORATION.  ALL THIS IS
 
 6  BEING LITIGATED IN HOUSTON NOW, AND ALL OF THESE MATTERS
 
 7  HAVE BEEN THOROUGHLY DISCUSSED.  AND THERE WOULD BE A
 
 8  HEARING ON NOVEMBER 8TH, WHICH IS ONE WEEK FROM TOMORROW,
 
 9  AND HOPEFULLY, WE'LL HAVE DETERMINATION OF WHO THE
 
10  LEGITIMATE BOARD IS.
 
11       MR. BEUGELMANS:  MOVE TO STRIKE THE LATTER PART OF THE
 
12  ANSWER.  NONRESPONSIVE.
 
13       THE COURT:  SUSTAINED.
 
14
 
15  BY MR. BEUGELMANS:
 
16       Q    IS IT YOUR TESTIMONY, SIR, THAT SINCE 1966, UP TO
 
17  THE PRESENT TIME, YOU HAVE BEEN A MEMBER OF THE BOARD OF
 
18  DIRECTORS OF LIBERTY LOBBY — I'M SORRY, LEGION FOR THE
 
19  SURVIVAL OF FREEDOM, INC.?
 
20       A    YES.
 
21       Q    YOU HAD THE AUTHORITY THAT VESTS IN A MEMBER SINCE
 
22  THAT TIME UP TO THE PRESENT?
 
23       A    HAD THE AUTHORITY TO WHAT?
 
24       Q    YOU HAD THE AUTHORITY THAT GOES WITH BEING A
 
25  MEMBER FROM 1966 UP UNTIL THE PRESENT TIME?
 
26       MR. WAIER:  OBJECTION.  VAGUE AND AMBIGUOUS, “MEMBER."
 
27  MEMBER OF THE BOARD OF DIRECTORS, A MEMBER AS INCORPORATED?
 
28       THE COURT:  I WILL SUSTAIN THE OBJECTION.
			
			

page  77
 
 
 
 1  BY MR. BEUGELMANS:
 
 2       Q    SIR, IS IT YOUR CONTENTION THAT YOU HAVE BEEN A
 
 3  MEMBER CONTINUOUSLY SINCE 1966 UP TO THE PRESENT?
 
 4       A    YES.
 
 5       Q    IS IT YOUR CONTENTION AS A MEMBER, YOU ARE A
 
 6  PERSON WITH A POSITION OF AUTHORITY OVER THE PLAINTIFF?
 
 7       A    NO.  THERE’s ANOTHER MEMBER, MRS. FURR, WHO I
 
 8  BELIEVE SHE WAS APPOINTED A MEMBER PRIOR TO 1966, POSSIBLY
 
 9  '65.  SO THIS RESPONSIBILITY AND AUTHORITY HAS BEEN SHARED.
 
10       MR. BEUGELMANS:  MOVE TO STRIKE.  NONRESPONSIVE, YOUR
 
11  HONOR.
 
12       THE COURT:  OVERRULED.  I THINK IT’s REASONABLY
 
13  RESPONSIVE.
 
14
 
15  BY MR. BEUGELMANS:
 
16       Q    IS IT YOUR TESTIMONY, SIR, THAT YOU AND
 
17  LAVONNE FURR JOINTLY HAVE AUTHORITY OVER PLAINTIFF IN YOUR
 
18  CAPACITY AS MEMBERS OF THE CORPORATION?
 
19       A    YES.
 
20       Q    HAVE YOU MADE ANY STATEMENTS TO ANYBODY UNDER OATH
 
21  BETWEEN 1966 AND THE PRESENT TIME THAT YOU HAVE NO POSITION
 
22  OF AUTHORITY OVER THE LEGION?
 
23       A    I DON'T THINK SO.
 
24       Q    DO YOU RECALL YOUR DEPOSITION BEING TAKEN IN 1991
 
25  IN THE CASE NUMBER C 629224, MEL MERMELSTEIN VERSUS LEGION
 
26  FOR THE SURVIVAL OF FREEDOM, INC., ET AL., ACTION FILED IN
 
27  THE SUPERIOR COURT FOR THE STATE OF CALIFORNIA, COUNTY OF
 
28  LOS ANGELES?
			
			

page  78
 
 
 
 1       MR. WAIER:  YOUR HONOR, I WOULD LIKE TO SEE THIS
 
 2  DEPOSITION IF HE HAS IT.  IT HAS NOT BEEN PRODUCED.
 
 3       THE COURT:  SHOW IT TO HIM.
 
 4       MR. WAIER:  I WOULD OBJECT TO THE READING OF THE
 
 5  DEPOSITION IN OTHER LITIGATION.
 
 6       THE COURT:  OVERRULED.
 
 7       MR. BEUGELMANS:  LET THE RECORD REFLECT I'M APPROACHING
 
 8  COUNSEL.  I HAVE A CERTIFIED COPY OF A DEPOSITION, THAT
 
 9  THERE IS AN OFFICIAL SEAL OF THE COURT REPORTER, LANG
 
10  FAHLER, THE ORIGINAL, IF COUNSEL WANTS TO LOOK AT IT.
 
11       MR. WAIER:  I WAGED THIS ARGUMENT BEFORE WITH RESPECT
 
12  TO DEPOSITION TRANSCRIPTS IN OTHER LITIGATION.  THE ONLY
 
13  FOUNDATION TO BRING ANY DEPOSITION FROM — TRANSCRIPT FROM
 
14  ANOTHER LITIGATION IS TO CALL THE COURT REPORTER FOR
 
15  PURPOSES.  CERTIFIED COPIES DON'T DO IT.  YOU HAVE TO HAVE
 
16  THE CERTIFIED COURT REPORTER.  IF NOT, IT’s HEARSAY.  THAT'S
 
17  LAW.  IN THIS LITIGATION, THAT’s ANOTHER STORY.  WITH
 
18  RESPECT TO ANY LITIGATION, THE COURT REPORTER MUST BE
 
19  CALLED.
 
20       THE COURT:  YOU CAN GET ME SOME AUTHORITY FOR THAT.
 
21  I'M NOT AWARE OF THAT.  MAYBE SO.  IN ANY CASE, PROCEED ON.
 
22       MR. WAIER:  I HAVEN'T SEEN THIS, YOUR HONOR.
 
23       THE COURT:  YOU CAN LOOK AT IT WHILE WE'RE PROCEEDING
 
24  WITH OTHER QUESTIONS.
 
25
 
26  BY MR. BEUGELMANS:
 
27       Q    MR. CARTO, PLEASE TURN TO EXHIBIT 3 IN THE BOOK
 
28  BEFORE YOU, PLAINTIFF’s 3.
			
			

page  79
 
 
 
 1       A    YES.
 
 2       Q    DID YOU PREPARE EXHIBIT 3?
 
 3       A    I DON'T REMEMBER.  THAT WAS 1966.  THAT WAS 30
 
 4  YEARS AGO.
 
 5       Q    TURN TO YOUR DEPOSITION, PAGE 174, THE DEPOSITION
 
 6  TAKEN IN THIS ACTION, OCTOBER 17, 1995.
 
 7       MR. WAIER:  YOUR HONOR, I HAD AN OPPORTUNITY TO REVIEW
 
 8  PAGE 112 YOU WANTED TO READ FROM.
 
 9       THE COURT:  THAT’s ON SOMETHING ELSE.  HE’s GOING TO A
 
10  NEW DEPOSITION.
 
11       MR. WAIER:  I WOULD LIKE TO SEE THE DEPOSITION, YOUR
 
12  HONOR.
 
13       THE COURT:  DON'T YOU HAVE A COPY OF THE DEPOSITION?
 
14       MR. WAIER:  NO.  I DIDN'T PLAN ON CALLING WITNESSES
 
15  TODAY, AND I HAVE THE DEPOSITION ON ITS WAY DOWN HERE NOW.
 
16  I DIDN'T KNOW WHO HE WAS GOING TO CALL.  IF HE HAD ADVISED
 
17  ME HE WOULD CALL WILLIS CARTO --
 
18       THE COURT:  I ASKED A QUESTION, DO YOU HAVE A COPY, AND
 
19  THE ANSWER IS “NO"?
 
20       MR. WAIER:  “NO."
 
21       MR. BEUGELMANS:  I HAVE A COMPRESSED TRANSCRIPT.  I CAN
 
22  GIVE IT --
 
23       THE COURT:  YOU SPEAK RAPIDLY.  I DIDN'T HEAR.
 
24       MR. BEUGELMANS:  I HAVE A COMPRESSED TRANSCRIPT, A
 
25  SMALL ONE.  IF I CAN FIND IT, I WILL GIVE IT TO COUNSEL.
 
26       THE COURT:  GIVE HIM A COMPRESSED TRANSCRIPT.
 
27                            (PAUSE)
 
28       THE COURT:  WHY DON'T WE GO ON WITH SOMETHING WHILE
			
			

page  80
 
 
 
 1  SOMEBODY ELSE LOOKS FOR THIS.  DON'T WE HAVE 2 ATTORNEYS ON
 
 2  THIS SIDE OVER HERE, THE PLAINTIFF’s SIDE?
 
 3       MR. BEUGELMANS:  I FOUND IT.  I HAVE IT.
 
 4       THE COURT:  YOU DISAPPEARED.  LET’s PROCEED ON.
 
 5       MR. BEUGELMANS:  YES, THANK YOU.  I'M HANDING COUNSEL A
 
 6  COMPRESSED TRANSCRIPT OF MR. Carto’s DEPOSITION IN THIS
 
 7  CASE.
 
 8       MR. WAIER:  WHAT PAGE DO YOU WANT TO READ FROM?
 
 9       MR. BEUGELMANS:  PAGE — STARTING PAGE 173, LINE 13
 
10  THROUGH 174, LINE 4.
 
11
 
12  BY MR. BEUGELMANS:
 
13       Q   “QUESTION” --
 
14       MR. WAIER:  CAN I READ IT, BECAUSE I MAY BE MAKING
 
15  OBJECTIONS TO SOME OF THE QUESTIONS.  I AM ENTITLED TO DO
 
16  THAT.
 
17       THE COURT:  GO AHEAD AND READ IT.  (PAUSE.)
 
18            THAT SHOULD BE ENOUGH TIME.
 
19       MR. WAIER:  I'M GOING TO OBJECT TO RELEVANCY WITH
 
20  RESPECT TO IMPEACHMENT.  I AM NOT SURE WHAT — IF IT’s THE
 
21  RELEVANCY IMPEACHMENT, I DON'T SEE IMPEACHMENT WITH WHAT IS
 
22  BEING READ.
 
23       THE COURT:  OVERRULED.  WHAT IS IT GOING TO SAY?  HOW
 
24  DO I KNOW UNTIL I READ AND HEAR IT?
 
25       MR. BEUGELMANS:  YOUR HONOR, MAY I PROCEED OR MAKE AN
 
26  OFFER OF PROOF?
 
27       THE COURT:  MAKE AN OFFER OF PROOF.
 
28       MR. BEUGELMANS:  THE OFFER OF PROOF WILL BE IN THE
			
			

page  81
 
 
 
 1  DEPOSITION, MR. CARTO STATES HE DID IN FACT PREPARE
 
 2  EXHIBIT 3, BYLAWS OF JUNE 16, 1966.
 
 3       THE COURT:  OVERRULE THE OBJECTION.  I OVERRULED THE
 
 4  OBJECTION, COUNSEL.  I'M NOT GOING TO ARGUE WITH YOU, LISTEN
 
 5  TO ARGUMENT.  IF I WANT IT, I WILL ASK FOR IT.  IF YOU THINK
 
 6  IT’s THAT IMPORTANT, SAY MAY I BE HEARD.  I WILL PROBABLY
 
 7  LET YOU ARGUE SOME.  I'M NOT GOING TO SPEND DAYS AND DAYS
 
 8  AND DAYS GOING THROUGH THIS CASE.  THIS CASE WILL NOT TURN
 
 9  INTO AN EIGHT-VOLUME CASE.  IT WILL PROCEED SMARTLY LIKE A
 
10  TRIAL DOES.  LET’s GO.
 
11
 
12  BY MR. BEUGELMANS:
 
13       Q   “I WOULD LIKE TO SHOW YOU ANOTHER DOCUMENT MARKED
 
14  COLLECTIVELY AS EXHIBIT 189.  IT’s A 3-PAGE DOCUMENT
 
15  ENTITLED BYLAWS.”  AND THE BYLAWS WERE ATTACHED TO EXHIBIT
 
16  18 TO THE DEPOSITION.
 
17            “QUESTION:  HAVE YOU SEEN THE DOCUMENT, SIR?
 
18            “ANSWER: YES."
 
19            “QUESTION:  DID YOU PREPARE THAT DOCUMENT?
 
20            “ANSWER:  THE BYLAWS?
 
21            “QUESTION:  YES.
 
22            “ANSWER:  AS FAR AS I CAN RECALL, I PREPARED
 
23  IT."
 
24       A    DO YOU WANT ME TO ANSWER?
 
25       Q    THERE’s NO QUESTION TO ANSWER.
 
26       MR. WAIER:  I AM GOING TO MOVE TO STRIKE THE ANSWER AS
 
27  VAGUE AND AMBIGUOUS TO WHAT HE’s REFERRING TO, WHICH BYLAWS
 
28  AND SO FORTH.
			
			

page  82
 
 
 
 1       THE COURT:  OVERRULED.  YOU CAN GO INTO THAT ON
 
 2  DIRECT.
 
 3       MR. BEUGELMANS:  MAY I APPROACH THE WITNESS?  I DON'T
 
 4  WANT TO PLAY GAMES WITH COUNSEL AND THE COURT.  HE SHOULD
 
 5  HAVE BROUGHT THE DEPOSITION TRANSCRIPT.
 
 6       THE COURT:  DON'T COMMENT ON HIM.  JUST PROCEED.  ASK
 
 7  QUESTIONS; GET ANSWERS.  I WILL RULE ON THE EVIDENCE.
 
 8
 
 9  BY MR. BEUGELMANS:
 
10       Q    YOUR HONOR — MR. CARTO, IS EXHIBIT 18 TO YOUR
 
11  DEPOSITION THE SAME AS EXHIBIT 3, PLAINTIFF’s EXHIBIT 3?
 
12       A    YES.
 
13       Q    THANK YOU, SIR.
 
14       A    ALTHOUGH YOU HAVEN'T PERMITTED ME TO ANSWER THE
 
15  QUESTION.
 
16       THE COURT:  SIR, ANSWER THE QUESTION HE ASKED.  I DON'T
 
17  WANT ANY COMMENTS FROM YOU.  YOU ARE GOING TO HURT YOUR CASE
 
18  IF YOU CONTINUE COMMENTING ON THINGS THAT AREN'T QUESTIONS.
 
19  YOU HAVE A GOOD ATTORNEY HERE.  HE'LL GET THINGS OUT FOR
 
20  YOU.
 
21
 
22  BY MR. BEUGELMANS:
 
23       Q    MR. CARTO, PLEASE TURN TO EXHIBIT 4, PLAINTIFF'S
 
24  4.
 
25       A    YES.
 
26       Q    HAVE YOU SEEN EXHIBIT 4 BEFORE?
 
27       A    YES.
 
28       Q    AND WHAT IS EXHIBIT 4?
			
			

page  83
 
 
 
 1       A    ARTICLES OF MERGER OF THE LEGION FOR SURVIVAL OF
 
 2  FREEDOM, INC., AND THE COMMITTEE FOR RELIGIOUS DEVELOPMENT,
 
 3  INC.
 
 4       Q    TURN TO PAGE 3 OF EXHIBIT 4.
 
 5       A    YES.
 
 6       Q    IS THAT YOUR SIGNATURE SHOWN ABOVE WILLIS A.
 
 7  CARTO, VICE-PRESIDENT?
 
 8       A    YES.
 
 9       Q    THANK YOU, SIR.  TURN TO EXHIBIT 5, PLEASE.
 
10       A    RIGHT.
 
11       Q    HAVE YOU HAD OCCASION TO READ EXHIBIT 5 IN THE
 
12  PAST?
 
13       A    I'M SURE I HAVE.  THEY'RE MINUTES, MARCH 25, 1966.
 
14       Q    AT THAT TIME, SIR, WERE YOU DIRECTOR OF THE
 
15  LEGION?
 
16       A    I BELIEVE.  I BELIEVE I WAS.
 
17       Q    AND IS IT YOUR SIGNATURE PAGE 3 OF EXHIBIT 5?
 
18       A    YES.
 
19       Q    DID YOU READ EXHIBIT 5 BEFORE YOU SIGNED IT?
 
20       A    YES, I'M SURE I DID.  IT’s 30 YEARS OLD.  I DON'T
 
21  REMEMBER WHAT’s IN IT.
 
22       MR. BEUGELMANS:  MOVE TO STRIKE AS NONRESPONSIVE, YOUR
 
23  HONOR.
 
24       THE COURT:  SUSTAINED.
 
25
 
26  BY MR. BEUGELMANS:
 
27       Q    MR. CARTO, IN 1989, DID — JUNE OF 1989, DID YOU
 
28  EVER HAVE OCCASION TO SEND A LETTER TO HONORABLE PAUL
			
			

page  84
 
 
 
 1  MCCLOSKEY IN WHICH YOU TOLD THEM YOU HAD NO OFFICIAL
 
 2  POSITION WITH THE LEGION?
 
 3       MR. WAIER:  OBJECTION.  RELEVANCY.
 
 4       THE COURT:  OVERRULED.
 
 5       THE WITNESS:  I DON'T REMEMBER.
 
 6
 
 7  BY MR. BEUGELMANS:
 
 8       Q    FOR THE PURPOSE OF REFRESHING YOUR RECOLLECTION,
 
 9  LET ME HAND YOU A COPY OF A LETTER DATED JUNE 3, 1989.
 
10            GIVE A COPY TO COUNSEL.
 
11       MR. WAIER:  WHAT EXHIBIT IS THIS?
 
12       MR. BEUGELMANS:  THIS IS NOT AN EXHIBIT.  THIS IS
 
13  IMPEACHMENT.
 
14       THE COURT:  WE OUGHT TO MARK IT SO WE KEEP TRACK OF
 
15  THINGS.
 
16       MR. BEUGELMANS:  NEXT IN ORDER WILL BE EXHIBIT 181.
 
17       MR. WAIER:  YOUR HONOR, WE HAVE NEVER SEEN THIS
 
18  DOCUMENT.  IT WASN'T PROVIDED AS PART OF THE EXHIBIT.
 
19       THE COURT:  IT’s IMPEACHMENT.  IT DOESN'T HAVE TO BE IF
 
20  IT’s TRUE IMPEACHMENT.
 
21       MR. WAIER:  I UNDERSTAND THAT.  UNFORTUNATELY, THE
 
22  QUESTION WAS DOES HE RECALL THE LETTER.  HE SAYS HE DOESN'T
 
23  RECALL A LETTER.  WHAT, IS THAT IMPEACHMENT?
 
24
 
25  BY MR. BEUGELMANS:
 
26       Q    SIR --
 
27       THE COURT:  I'M NOT GOING TO ARGUE WITH YOU.  I MADE
 
28  THE RULING.  YOU KNOW WHY IT’s IMPEACHMENT.  I'M NOT GOING
			
			

page  85
 
 
 
 1  TO TELL YOU WHY SO THE WITNESS KNOWS.
 
 2
 
 3  BY MR. BEUGELMANS:
 
 4       Q    SIR, DOES THE DOCUMENT YOU HAVE IN FRONT OF YOU
 
 5  REFRESH YOUR RECOLLECTION AS TO WHETHER YOU SENT A LETTER TO
 
 6  HONORABLE PAUL N. MCCLOSKEY STATING YOU HOLD NO OFFICIAL
 
 7  POSITION WITH THE LEGION?
 
 8       A    YES.
 
 9       Q    AND DID YOU IN FACT SEND A LETTER TO THAT EFFECT?
 
10       A    YES.
 
11       Q    DO YOU RECALL, SIR, ON MAY 20, 1993, YOU SENT A
 
12  LETTER TO WILLIAM HULSY, ESQUIRE?  DO YOU RECALL, SIR?
 
13       A    NO.
 
14       MR. WAIER:  WHAT DATE?
 
15       MR. BEUGELMANS:  MAY 20, 1993.
 
16
 
17  BY MR. BEUGELMANS:
 
18       Q    MAY I SHOW YOU, SIR, A LETTER — COPY OF A
 
19  LETTER, A FAX, AND ASK YOU IF THIS FAX, WHICH WE'LL MARK AS
 
20  THE NEXT EXHIBIT --
 
21       THE CLERK:  182, YOUR HONOR.
 
22
 
23  BY MR. BEUGELMANS:
 
24       Q    — REFRESHES YOUR RECOLLECTION TO WHETHER YOU SENT
 
25  A FAX TO BILL HULSY ON MAY 20, 1993.
 
26       A    YES.
 
27       Q    IN YOUR LETTER OF MAY 20, 1993, TO BILL HULSY, DO
 
28  YOU STATE “I AM AN OFFICER AND DIRECTOR OF LIBERTY LOBBY BUT
			
			

page  86
 
 
 
 1  HAVE NO POSITION WHATEVER WITH L.S.F. EXCEPT THAT OF
 
 2  SYMPATHIZER AND FRIENDS OF THE BOARD OF DIRECTORS"?
 
 3       A    YES.
 
 4       Q    WAS WILLIAM HULSY, ESQUIRE, THE ATTORNEY FOR THE
 
 5  LEGION AS OF MAY 20, 1993?
 
 6       A    I DON'T KNOW.  HE SAYS HE WAS, HE SAYS HE WASN'T.
 
 7  HE’s NOT A TRUTHFUL PERSON.
 
 8       MR. BEUGELMANS:  MOVE TO STRIKE AS NONRESPONSIVE, YOUR
 
 9  HONOR.
 
10       THE WITNESS:  I DON'T KNOW HOW ELSE TO ANSWER, YOUR
 
11  HONOR.
 
12       THE COURT:  JUST SAY — YOU DON'T HAVE TO COMMENT ON
 
13  HIS TRUTH AND VERACITY.  THAT QUESTION WASN'T ASKED OF YOU,
 
14  SIR; YOU KNOW THAT.
 
15            STRIKE THE ANSWER AS TO MR. HULSY’s TRUTH AND
 
16  VERACITY.
 
17
 
18  BY MR. BEUGELMANS:
 
19       Q    MR. CARTO, DID YOU CONSIDER --I'M GETTING OVER A
 
20  COLD, I'M SORRY.
 
21            MR. CARTO, DID YOU CONSIDER WILLIAM HULSY,
 
22  ESQUIRE, TO BE THE LEGION’s COUNSEL AT THE TIME YOU SENT THE
 
23  FAX OF MAY 20, 1993?
 
24       A    DID I CONSIDER HIM TO BE?
 
25       Q    YES.
 
26       A    YES.
 
27       Q    THANK YOU.  NOW, SIR, IT’s TRUE, ISN'T IT, THAT
 
28  YOU BORROWED ALL OF THE MONEY THAT WAS USED TO FINANCE THE
			
			

page  87
 
 
 
 1  LITIGATION IN EUROPE AND ELSEWHERE CONCERNING THE FARREL
 
 2  ESTATE, CORRECT?
 
 3       MR. WAIER:  OBJECTION.  RELEVANCY.
 
 4       THE COURT:  OVERRULED.
 
 5       THE WITNESS:  NO.
 
 6
 
 7  BY MR. BEUGELMANS:
 
 8       Q    I WOULD LIKE TO TURN TO YOUR DEPOSITION, SIR,
 
 9  PAGE 208.
 
10       A    PAGE WHAT?
 
11       Q    PAGE 208.
 
12       A    I DON'T HAVE THAT HERE.  OH, THE DEPOSITION.
 
13  EXCUSE ME.
 
14       Q    ACTUALLY, START PAGE 207, IF I COULD BACK UP TO
 
15  GIVE THE COURT SOME PRELIMINARY INFORMATION.
 
16            MR. CARTO, DID THE LEGION HIRE MR. REDDEN IN NORTH
 
17  CAROLINA TO PURSUE LITIGATION TO RECOVER THE FARREL ASSETS?
 
18       A    YES.  WELL, I HIRED HIM FOR THE LEGION.
 
19       Q    DID THE LEGION PAY MR. REDDEN, R-E-D-D-E-N, FOR
 
20  HIS SERVICES?
 
21       A    NO.  AT LEAST NOT THAT I RECALL.  I THINK — MAY
 
22  I EXPLAIN MYSELF, YOUR HONOR, BECAUSE THIS IS A --
 
23       THE COURT:  I THINK THE ANSWER WAS, WAS HE HIRED.  IF
 
24  YOU DON'T KNOW, THAT’s FINE.
 
25       THE WITNESS:  WELL, HE WAS HIRED.  WHETHER THE LEGION
 
26  PUT UP MONEY OR NOT, I DON'T KNOW.  I DON'T THINK IT DID.  I
 
27  THINK IT WAS OUTSIDE MONEY THAT I BORROWED.
 
28
			
			

page  88
 
 
 
 1  BY MR. BEUGELMANS:
 
 2       Q    NOW, THE MONEY USED TO PAY MR. REDDEN WAS
 
 3  BORROWED, CORRECT?
 
 4       A    I THINK SO.
 
 5       Q    AND ALL OF THE OTHER MONEY USED IN THE LITIGATION
 
 6  WAS BORROWED, WASN'T IT, SIR?
 
 7       A    YES.
 
 8       Q    AND IT WAS MOSTLY BORROWED FROM LIBERTY LOBBY,
 
 9  INCORPORATED, SIR?
 
10       A    WE'RE GETTING INTO LIBERTY LOBBY MATTERS NOW.  I
 
11  UNDERSTOOD WE WOULDN'T GET INTO THAT.
 
12       THE COURT:  THAT’s CORRECT.
 
13
 
14  BY MR. BEUGELMANS:
 
15       Q    ALL RIGHT.  OTHER THAN LIBERTY LOBBY,
 
16  INCORPORATED, THE ONLY SOURCE OF FUNDS — STRIKE THAT.
 
17            THE PRIMARY SOURCE OF FUNDS OTHER THAN LIBERTY
 
18  LOBBY, INCORPORATED, FROM WHOM YOU BORROWED FUNDS TO FINANCE
 
19  THE FARREL LITIGATION WAS F.D.F.A., CORRECT?
 
20       MR. WAIER:  OBJECT TO VAGUE AND AMBIGUOUS.
 
21       THE COURT:  OVERRULED.
 
22       THE WITNESS:  I DON'T RECALL.  MY RECOLLECTION, A
 
23  NUMBER OF ENTITIES THAT SUPPLIED MONEY, INCLUDING MYSELF
 
24  PERSONALLY.
 
25
 
26  BY MR. BEUGELMANS:
 
27       Q    MR. CARTO, YOU HAVE NO RECORDS OF ANY MONIES THAT
 
28  YOU PERSONALLY LOANED TO ANY ENTITY TO PURSUE THE LITIGATION
			
			

page  89
 
 
 
 1  INVOLVING THE FARREL ESTATE, DO YOU?
 
 2       MR. WAIER:  OBJECTION.  VAGUE AND AMBIGUOUS.
 
 3       THE COURT:  OVERRULED.
 
 4       THE WITNESS:  I BELIEVE I DID BEFORE MY HOUSE WAS
 
 5  RAIDED, THANKS TO MR. MARCELLUS AND MR. WEBER.  AND 14
 
 6  VOLUMES OF RECORDS WERE TAKEN, WHICH I CANNOT GET BACK.
 
 7
 
 8  BY MR. BEUGELMANS:
 
 9       Q    MR. CARTO, DID YOU PREPARE ANY TYPE OF AN
 
10  ACCOUNTING REFLECTING THE FACT THAT YOU USED YOUR OWN FUNDS
 
11  TO PURSUE THE FARREL LITIGATION?
 
12       A    NO.  WELL, JUST A MINUTE.  I DON'T REMEMBER.  I'M
 
13  SURE THAT I MUST HAVE MADE A RECORD OF IT SOMEWHERE.  BUT I
 
14  CAN'T LAY MY HANDS ON IT.  IT’s PROBABLY AMONG THE PAPERS
 
15  THAT WERE TAKEN.
 
16       Q    SIR, HOW MUCH MONEY DID YOU BORROW TO PURSUE THE
 
17  FARREL BEQUEST?
 
18       A    I THINK THAT GETS INTO THE QUESTION OF LIBERTY
 
19  LOBBY.
 
20       THE COURT:  NO, SIR, I DON'T BELIEVE IT DOES.
 
21       THE WITNESS:  YOU SAY HOW MUCH MONEY DID I BORROW IN
 
22  TOTAL?
 
23
 
24  BY MR. BEUGELMANS:
 
25       Q    YES.
 
26       A    I CAN'T TELL YOU WITH — WITH ANY ASSURANCE OF
 
27  COMPLETE ACCURACY.  IT WAS HUNDREDS OF THOUSANDS OF DOLLARS.
 
28       Q    IS IT A FIGURE APPROXIMATELY $400,000?
			
			

page  90
 
 
 
 1       A    AT LEAST.  I WOULD SAY MORE.  THERE WERE 10
 
 2  ATTORNEYS INVOLVED.
 
 3       Q    PRIOR TO SEPTEMBER 20, 1985, DID YOU EVER OFFER AN
 
 4  OPINION TO THE DIRECTORS OF THE LEGION AS TO THE APPROXIMATE
 
 5  GROSS VALUE OF NECA?
 
 6       A    PRIOR TO WHAT?
 
 7       Q    SEPTEMBER 20, 1985.
 
 8       MR. WAIER:  OBJECTION.  RELEVANCY.
 
 9       THE COURT:  OVERRULED.
 
10       THE WITNESS:  1985?
 
11
 
12  BY MR. BEUGELMANS:
 
13       Q    YES.
 
14       A    YES.
 
15       Q    YOU DID?
 
16       A    I BELIEVE SO, YES.
 
17       Q    AND WHAT OPINION DID YOU OFFER THEM AS TO THE
 
18  VALUE OF NECA?
 
19       MR. WAIER:  I'M GOING TO OBJECT, YOUR HONOR, AS TO
 
20  RELEVANCY.  AND MAY I BE HEARD?
 
21       THE COURT:  YES, GO AHEAD.
 
22       MR. WAIER:  WE'RE TALKING ABOUT AN EVENT WHERE ASSETS
 
23  CAME INTO EXISTENCE AFTER 1991, THE VALUE OF WHICH IS BEING
 
24  COMPLAINED OF AS OF 1991, WHATEVER THOSE ASSETS WERE.
 
25  THERE’s BEEN NO FOUNDATION LAID AS TO WHAT THOSE ASSETS WERE
 
26  IN 1991.  A VALUE IN 1985 OR AN OPINION AS TO A VALUE 1985
 
27  WAS IRRELEVANT AS TO ANY ISSUE THAT’s PRESENTLY BEFORE THIS
 
28  COURT.
			
			

page  91
 
 
 
 1       THE COURT:  WHAT’s THE RELEVANCE, IN YOUR OPINION?
 
 2       MR. BEUGELMANS:  YES.  THE EVIDENCE WILL SHOW THAT THE
 
 3  MAIN DEFENSE BEING PROFFERED BY THE DEFENDANTS IN THIS CASE
 
 4  IS MR. CARTO MADE A DEAL WITH THE LEGION PRIOR --
 
 5       THE COURT:  MADE A WHAT?
 
 6       MR. BEUGELMANS:  MADE A DEAL, ENTERED INTO A CONTRACT,
 
 7  IF YOU WILL, WITH THE LEGION, ALTHOUGH THEY DENY THERE WAS A
 
 8  CONTRACT PRIOR TO THE LEGION 1985.  AND THE ALLEGED
 
 9  AGREEMENT WAS THAT WILLIS CARTO WOULD FINANCE THE LITIGATION
 
10  IN RETURN FOR WHICH HE WOULD BE ENTITLED TO REIMBURSEMENT OF
 
11  HIS INVESTMENT AND A RIGHT TO THE FUNDS OR AT LEAST A RIGHT
 
12  TO DISTRIBUTE THE FUNDS.  IT’s OUR POSITION THAT ANY SUCH
 
13  CONTRACT WOULD BE VOID WITHOUT A DISCLOSURE TO THE DIRECTORS
 
14  AS TO THE APPROXIMATE VALUE OF NECA.  THERE’s NO
 
15  CONSIDERATION.
 
16       THE COURT:  ANYTHING ELSE, BRIEFLY?
 
17       MR. WAIER:  BRIEFLY, YOUR HONOR.  FIRST, THAT IS NOT
 
18  OUR DEFENSE.  THE DEFENSE IS 1986 THERE WAS AN AGREEMENT
 
19  MADE IN CONNECTION WITH MR. Carto’s INVOLVEMENT AS TO
 
20  CONSIDERATION FOR THE VALUE OF THE NECA STOCK.  I DON'T
 
21  UNDERSTAND HOW THAT CONSIDERATION GOES WITH RESPECT TO THE
 
22  AGREEMENT COUNSEL HAS RECITED TO YOU.
 
23       THE COURT:  OBJECTION OVERRULED.
 
24
 
25  BY MR. BEUGELMANS:
 
26       Q    I WOULD LIKE TO READ FROM YOUR DEPOSITION,
 
27  PAGE 75, STARTING LINE 20 --
 
28       THE COURT:  I DON'T THINK HE HAS BEEN GIVEN AN
			
			

page  92
 
 
 
 1  OPPORTUNITY TO ANSWER THE QUESTION.
 
 2       THE WITNESS:  WOULD YOU REPEAT THE QUESTION.
 
 3
 
 4  BY MR. BEUGELMANS:
 
 5       Q    I'M SORRY.  WHAT ESTIMATE DID YOU TELL THE
 
 6  FURRS — STRIKE THAT.
 
 7            WHEN YOU GAVE THE FURRS AN OPINION TO THE VALUE OF
 
 8  NECA PRIOR TO SEPTEMBER 20, 1985, HOW MUCH DID YOU TELL THEM
 
 9  NECA ASSETS WERE WORTH AT THAT TIME?
 
10       A    I HAVE NO IDEA.  THIS INFORMATION WAS NOT
 
11  AVAILABLE TO ME.  THE MARKET WAS FLUCTUATING.  THERE WAS NO
 
12  POSSIBLE WAY TO TELL.  I DID TELL THE DIRECTORS THAT --
 
13  INCLUDING MRS. FURR, INCLUDING MR. FURR, INCLUDING HARVEY
 
14  TAYLOR, INCLUDING NOEL MERRIHEW AND INCLUDING TOM KERR,
 
15  THERE WAS A SUBSTANTIAL AMOUNT THERE AT STAKE, AND I WAS
 
16  GOING AFTER IT.  I DON'T REMEMBER WHAT THE AMOUNT WAS.  I
 
17  DON'T THINK I KNEW.
 
18       Q    PRIOR TO JANUARY 1, 1991, DID YOU TELL THE
 
19  DIRECTORS WHAT THE APPROXIMATE VALUE OF NECA’s ASSETS WERE?
 
20       A    I DON'T THINK SO.  I CAN'T TELL YOU ABOUT THE
 
21  DATES SPECIFICALLY.  BUT AS I DIDN'T KNOW, I CERTAINLY
 
22  COULDN'T TELL ANYBODY ELSE.
 
23       Q    NOW, SIR, YOU TESTIFIED EARLIER THAT ON BEHALF OF
 
24  THE LEGION, YOU HIRED MR. REDDEN TO PURSUE LITIGATION IN
 
25  NORTH CAROLINA CONCERNING THE FARREL ESTATE, CORRECT?
 
26       A    CORRECT.
 
27       Q    I WOULD LIKE YOU TO TURN, PLEASE, TO EXHIBIT --
 
28       MR. BEUGELMANS:  I'M SORRY, YOUR HONOR, IF I COULD TAKE
			
			

page  93
 
 
 
 1  A BRIEF RECESS HERE.  FROM THE ORIGINALS FROM NORTH
 
 2  CAROLINA, WE MADE COPIES DURING LUNCH.  THESE WILL BE --
 
 3  THESE ARE EXHIBITS NUMBER 15 THROUGH 19 COLLECTIVELY, YOUR
 
 4  HONOR.  WE KEPT THEM WITH THE SEAL THE STATE OF CALIFORNIA
 
 5  ON TOP.  THEY'RE NOT IN THE BOOK.  I HAVE A COMPLETE COPY
 
 6  FOR COUNSEL.
 
 7       THE COURT:  MAYBE WE OUGHT TO GIVE IT A BRAND NEW
 
 8  NUMBER.  109.
 
 9       MR. BEUGELMANS:  IT’s 18.
 
10       THE CLERK:  183, YOUR HONOR, IS THE NEXT IN LINE.
 
11       THE COURT:  CALL THIS 183, WHICH IT APPEARS TO BE A
 
12  CERTIFIED COPY OF SOME RECORDS OUT OF THE STATE OF NORTH
 
13  CAROLINA.
 
14
 
15  BY MR. BEUGELMANS:
 
16       Q    MR. CARTO, YOU HAVE A COPY IN FRONT OF YOU OF
 
17  EXHIBIT 183.  PLEASE TAKE A LOOK AT IT.
 
18       A    ANY PARTICULAR PAGE YOU WOULD LIKE ME TO LOOK AT?
 
19       Q    LET ME APPROACH YOU, AND YOU WILL SEE THE
 
20  COMPLAINT, A VERIFIED COMPLAINT OF THE BACK OF THE FILE.
 
21  THESE WERE KEPT IN THE NORTH CAROLINA RECORDS IN REVERSE
 
22  CHRONOLOGICAL ORDER, YOUR HONOR.
 
23            DO YOU SEE, SIR, A DOCUMENT ENTITLED “COMPLAINT"?
 
24       A    RIGHT.
 
25       MR. BEUGELMANS:  YOUR HONOR, I DO HAVE AN EXTRA COPY
 
26  FOR THE COURT, IF THAT MAKES IT EASIER.
 
27       THE COURT:  I CAN USE THIS COPY UNLESS YOU WANT TO KEEP
 
28  IT.
			
			

page  94
 
 
 
 1  BY MR. BEUGELMANS:
 
 2       Q    SIR, ATTACHED TO THE COMPLAINT, THERE’s A
 
 3  VERIFICATION FORM.  DO YOU SEE THAT, SIR, PAGE 7 OF THE
 
 4  COMPLAINT?
 
 5       A    YES.
 
 6       Q    IS THAT YOUR SIGNATURE, SIR?
 
 7       A    PAGE 7?
 
 8       MR. WAIER:  I DON'T HAVE A PAGE 7.
 
 9       THE WITNESS:  THERE.
 
10
 
11  BY MR. BEUGELMANS:
 
12       Q    DO YOU SEE?
 
13       A    YES.
 
14       MR. WAIER:  WHICH PAGE ARE YOU TALKING ABOUT?
 
15
 
16  BY MR. BEUGELMANS:
 
17       Q    SIR, IS THAT YOUR SIGNATURE?
 
18       A    YES.
 
19       Q    IS IT NOTARIZED?
 
20       A    YES.
 
21       Q    DID YOU READ THE COMPLAINT ATTACHED TO EXHIBIT 183
 
22  BEFORE YOU SIGNED IT?
 
23       A    I SUPPOSE I DID.  I DON'T REMEMBER.
 
24       Q    DID YOU UNDERSTAND THAT YOUR SIGNATURE WAS BEING
 
25  NOTARIZED, SIR?
 
26       A    YES.
 
27       Q    WHAT IS YOUR HIGHEST EDUCATION, SIR?
 
28       A    MY HIGHEST EDUCATION?
			
			

page  95
 
 
 
 1       Q    YES, SIR.
 
 2       A    WELL, I ATTENDED 2 YEARS OF PRELAW IN
 
 3  UNIVERSITY --
 
 4       Q    SIR, IF YOU TURN TO PAGE 2 OF THE COMPLAINT, LOOK
 
 5  AT PARAGRAPH 7.
 
 6       A    YES.
 
 7       Q    I'M SORRY, PARAGRAPH 6.
 
 8       A    YES.
 
 9       Q    DID YOU READ PARAGRAPH 6 BEFORE YOU SIGNED THE
 
10  COMPLAINT IN EXHIBIT 183?
 
11       A    I'M SURE I DID.
 
12       Q    ARE THE FACTS STATED IN PARAGRAPH 6 CORRECT, SIR?
 
13       A    WELL, IF THEY WEREN'T CORRECT, I WOULDN'T HAVE
 
14  SIGNED IT AT THAT TIME.  THAT WAS PROBABLY THE SIZE OF THE
 
15  ESTATE ON THE STOCK MARKET AND AFTER TAXES — BEFORE TAXES.
 
16       Q    16 MILLION DOLLARS?
 
17       A    IT MUST HAVE BEEN TRUE, YES.
 
18       Q    PLEASE, SIR, TURN — LOOK AT PARAGRAPH 7 OF THE
 
19  COMPLAINT.  YOU SIGNED UNDER PENALTY OF PERJURY, SIR.
 
20       A    RIGHT.
 
21       Q    ARE THE FACTS --
 
22       A    PARAGRAPH 7?
 
23       Q    YES, SIR.
 
24       A    OKAY.
 
25       Q    ARE THE FACTS THAT YOU STATE IN PARAGRAPH 7 TRUE
 
26  AND CORRECT?
 
27       A    YES.
 
28       Q    HOW ABOUT PARAGRAPH 8, SIR?
			
			

page  96
 
 
 
 1       MR. WAIER:  I'M GOING TO OBJECT AT THIS JUNCTURE.  THIS
 
 2  INVOLVES HEARSAY, PURPORTS TO BE HEARSAY WITHOUT ANY FURTHER
 
 3  FOUNDATION.
 
 4       THE COURT:  OVERRULED.
 
 5       MR. WAIER:  MAY I BE HEARD ON THAT, YOUR HONOR?
 
 6       THE COURT:  NO.
 
 7       THE WITNESS:  ALL RIGHT.
 
 8
 
 9  BY MR. BEUGELMANS:
 
10       Q    ARE THE ALLEGATIONS IN PARAGRAPH 8, TRUE?
 
11       A    WELL, I BELIEVE SO.  ARE YOU REFERRING TO ANY
 
12  SPECIFIC ALLEGATION?
 
13       Q    IS THERE ANYTHING UNTRUE IN PARAGRAPH 8, SIR?
 
14       A    WELL, I DON'T KNOW.  I MEAN, THIS IS HEARSAY.
 
15  THIS REFERS TO ACTIONS — ALLEGED PURPORTED ACTIONS BY
 
16  JEAN FARREL AND HOW CAN I SAY --
 
17       Q    PLEASE TURN TO PARAGRAPH 15, SIR, PAGE 4.
 
18       A    ALL RIGHT.
 
19       Q    NOW, THE PLAINTIFF IN THIS ACTION WAS THE LEGION,
 
20  CORRECT?
 
21       A    CORRECT.
 
22       Q    IT WAS NOT YOU, WAS IT?
 
23       A    NO.
 
24       Q    ARE THE ALLEGATIONS IN PARAGRAPH 15 TRUE, SIR?
 
25       MR. WAIER:  OBJECTION.  CALLS FOR LEGAL CONCLUSION.
 
26  IRRELEVANT.  LACKS FOUNDATION.
 
27       THE COURT:  OVERRULED.
 
28       THE WITNESS:  I THINK SO.
			
			

page  97
 
 
 
 1  BY MR. BEUGELMANS:
 
 2       Q    THANK YOU, SIR.  NOW, MR. CARTO, DO YOU
 
 3  CONTEND — SINCE YOU BECAME A SUBSTITUTE INCORPORATOR OF
 
 4  THE LEGION SOMETIME IN 1966, YOU HAVE APPOINTED ALL THE
 
 5  DIRECTORS?
 
 6       A    NO.
 
 7       Q    I WOULD LIKE TO TURN TO YOUR DEPOSITION, SIR,
 
 8  PAGE 161.  MR. CARTO, SINCE YOU BECAME THE SUBSTITUTE
 
 9  INCORPORATOR, HAVE YOU AND LAVONNE FURR APPOINTED ALL THE
 
10  DIRECTORS?
 
11       A    OF COURSE.
 
12       Q    SO ALL DIRECTORS TO THE CORPORATION SINCE 1966
 
13  UNTIL THE PRESENT TIME HAVE BEEN APPOINTED BY YOU AND YOU
 
14  ALONE, YOU AND LAVONNE FURR, CORRECT?
 
15       A    WOULD YOU RESTATE YOUR QUESTION.  IT'S
 
16  CONTRADICTORY.
 
17       Q    IT’s YOUR POSITION, SIR, IT’s YOUR CONTENTION THAT
 
18  SINCE YOU BECAME SUBSTITUTE INCORPORATOR IN 1966, YOU AND
 
19  LAVONNE FURR HAVE APPOINTED ALL DIRECTORS TO THE LEGION?
 
20       A    THAT IS CORRECT.
 
21       Q    MR. CARTO, ISN'T IT TRUE THAT DIRECTORSHIPS TO THE
 
22  LEGION ARE A SELF-EXECUTING APPOINTMENT?  IN OTHER WORDS,
 
23  UNLESS A PARTICULAR DIRECTOR SAYS THE CONTRARY, HIS OR HER
 
24  ELECTION IS AUTOMATIC EACH YEAR?
 
25       A    ABSOLUTELY NOT.
 
26       Q    SIR, I WOULD LIKE YOU TO TAKE A LOOK AT A DOCUMENT
 
27  ENTITLED “DECLARATION OF WILLIS CARTO” ATTACHED TO THE
 
28  ORIGINAL TRANSCRIPT OF THIS DEPOSITION.  ASK YOU, SIR, IF
			
			

page  98
 
 
 
 1  YOU HAVE SEEN THIS EXHIBIT 21 TO THE DEPOSITION, YOUR
 
 2  DECLARATION OF WILLIS CARTO.  HAVE YOU SEEN THIS DOCUMENT,
 
 3  SIR?
 
 4       A    YES.
 
 5       MR. WAIER:  MAY I APPROACH THE WITNESS?
 
 6       MR. BEUGELMANS:  YES.
 
 7       MR. WAIER:  ANYTHING SPECIFIC?
 
 8
 
 9  BY MR. BEUGELMANS:
 
10       Q    HAVE YOU HAD A CHANCE TO LOOK AT THIS DECLARATION?
 
11       A    THIS IS A 7-PAGE DECLARATION DATED DECEMBER 20TH,
 
12  1993.
 
13       Q    IS THAT YOUR SIGNATURE AT PAGE --
 
14       A    YES.
 
15       Q    — 7?
 
16       A    YES.
 
17       Q    DID YOU READ THAT DECLARATION BEFORE YOU SIGNED
 
18  IT?
 
19       A    YES.
 
20       Q    I WOULD LIKE YOU TO LOOK AT PAGE 6 OF THE
 
21  DECLARATION, SIR.  IF YOU WOULD, PLEASE START READING AT
 
22  LINE 20 WITH THE WORD “IN."
 
23       A    “IN OTHER WORDS, UNLESS THE PARTICULAR DIRECTOR
 
24  SAYS TO THE CONTRARY, HIS OR HER ELECTION IS AUTOMATIC EACH
 
25  YEAR.”  ANOTHER EXAMPLE OF HOW --HOW DIRECTORS MEETINGS” --
 
26       Q    THAT’s FINE.
 
27       A    JUST A MINUTE.
 
28       Q    THERE’s NO QUESTION PENDING, SIR.
			
			

page  99
 
 
 
 1            AND WHAT DOES IT SAY, LINE 18 WITH THE WORD “AS"?
 
 2       A    “AS HAS BEEN POINTED OUT TO THE COURT,
 
 3  DIRECTORSHIPS ARE SELF-EXECUTING APPOINTMENTS."
 
 4       Q    THANK YOU, SIR.
 
 5       THE WITNESS:  MAY I ELABORATE ON THAT, YOUR HONOR?
 
 6       THE COURT:  SIR, WAIT UNTIL YOUR ATTORNEY HAS A CHANCE
 
 7  TO ASK YOU QUESTIONS ABOUT IT.
 
 8
 
 9  BY MR. BEUGELMANS:
 
10       Q    DURING THE TIME THAT YOU HAVE ALLEGEDLY BEEN A
 
11  MEMBER OF THE LEGION, WHAT IS YOUR UNDERSTANDING OF THE
 
12  FUNCTION OF THE BOARD OF DIRECTORS OF THAT ORGANIZATION?
 
13       A    THE FUNCTION OF THE BOARD OF DIRECTORS WAS TO
 
14  PROVIDE A LEGAL BACKSTOP IN THE NATURE OF INSURANCE TO
 
15  THE — TO THE CORPORATION SO THE CORPORATION WOULD NEVER BE
 
16  LEFT WITHOUT A LEGAL FOUNDATION.  IT WAS THE OPPORTUNITY TO
 
17  HEAR THE VIEWS OF TRUSTED SUPPORTERS AND MEMBERS OF THE
 
18  I.H.R.  IT WAS A LEGAL FRONTISPIECE SO IT COULD DO SUCH
 
19  THINGS AS APPOINT MEMBERS AND MAKE — AND MAKE OTHER
 
20  DECISIONS.  AND THE DIRECTORS WERE — WERE LEFT ON THE
 
21  BOARD UNLESS THEY WERE — THEY EITHER DID NOT WANT TO
 
22  REMAIN OR THEY WERE NOT RENOMINATED.  IN MANY CASES THE
 
23  DIRECTORS WERE NOT RENOMINATED.  THEY, THEREFORE, WERE NO
 
24  LONGER DIRECTORS.  I CAN CITE EXAMPLES OF THAT, IF YOU
 
25  WISH.
 
26       Q    SIR, THE BYLAWS OF THE LEGION, BOTH THE ORIGINAL
 
27  BYLAWS AND EXHIBIT 3, REQUIRE AN ANNUAL MEETING OF THE
 
28  DIRECTORS, CORRECT?
			
			

page  100
 
 
 
 1       A    YES.
 
 2       MR. WAIER:  OBJECTION.  VAGUE AND AMBIGUOUS.  LACKS
 
 3  FOUNDATION.
 
 4       THE COURT:  OVERRULED.
 
 5       MR. WAIER:  MAY I BE HEARD ON THAT?
 
 6       THE COURT:  NO.
 
 7
 
 8  BY MR. BEUGELMANS:
 
 9       Q    DURING THE TIME THAT YOU HAVE BEEN A MEMBER OF THE
 
10  LEGION, DID YOU AND LAVONNE FURR MAKE ALL IMPORTANT
 
11  DECISIONS CONCERNING THE LEGION’s BUSINESS BEFORE THE BOARD
 
12  OF DIRECTORS MEETING WAS CONVENED ON AN ANNUAL BASIS?
 
13       A    MRS. FURR AND I WORKED TOGETHER EVERY DAY.  WHEN I
 
14  WAS IN CALIFORNIA, ALL THE — ALL THE BUSINESS DETAILS WERE
 
15  ATTENDED TO BY — BY HER.  ALL IMPORTANT DECISIONS WERE
 
16  EITHER MADE BY BOTH OF US, AND NORMALLY THE BOARD WAS NOT
 
17  CONSULTED.
 
18       Q    SO BASICALLY, YOU AND LAVONNE MADE ALL THE
 
19  DECISIONS IN ADVANCE OF THE MEETING OF THE BOARD OF
 
20  DIRECTORS, CORRECT?
 
21       A    I WOULDN'T SAY ALL OF THEM, BUT CERTAINLY MOST OF
 
22  THEM.
 
23       Q    AND THE BOARD OF DIRECTORS WOULD RUBBER-STAMP WHAT
 
24  YOU AND LAVONNE DECIDED, CORRECT?
 
25       MR. WAIER:  OBJECTION.  VAGUE AND AMBIGUOUS TO
 
26  “RUBBER-STAMP."
 
27       THE WITNESS:  I DON'T LIKE THE TERMINOLOGY AT ALL.
 
28       THE COURT:  SUSTAIN THE OBJECTION.  I AGREE, I DON'T
			
			

page  101
 
 
 
 1  LIKE IT EITHER.  THE QUESTIONS NEED NOT BE ARGUMENTATIVE.
 
 2       THE WITNESS:  THE BOARD OF DIRECTORS WAS — WE WERE
 
 3  VERY CAREFUL TO MAKE IT COMPOSED OF PERSONS WE THOUGHT TO BE
 
 4  HIGHLY REPUTABLE PERSONS, WE COULD TRUST, HAD SOME
 
 5  INTEGRITY.  AND THEY WERE TREATED ACCORDING TO THAT BELIEF.
 
 6       MR. BEUGELMANS:  MOVE TO STRIKE.  NONRESPONSIVE, YOUR
 
 7  HONOR.
 
 8       THE COURT:  OVERRULED.
 
 9
 
10  BY MR. BEUGELMANS:
 
11       Q    SIR, PRIOR TO THE ANNUAL MEETINGS THAT WERE
 
12  CONDUCTED BY THE LEGION BETWEEN 1984 AND 1993, WOULD YOU
 
13  DISCUSS THE AGENDA FOR THE MEETINGS WITH THE DIRECTORS IN
 
14  ADVANCE OF THE MEETINGS BEING CONVENED?
 
15       A    NO.
 
16       Q    WOULD LAVONNE FURR DISCUSS THE AGENDA WITH THE
 
17  DIRECTORS IN ADVANCE OF THE MEETING BEING CONVENED?
 
18       MR. WAIER:  OBJECTION.  CALLS FOR HEARSAY.  LACKS
 
19  FOUNDATION.
 
20       THE COURT:  SUSTAINED.
 
21
 
22  BY MR. BEUGELMANS:
 
23       Q    DO YOU KNOW IF LAVONNE FURR WOULD DISCUSS THE
 
24  AGENDA WITH EACH AND EVERY DIRECTOR PRIOR TO THE ANNUAL
 
25  MEETING BEING CALLED?
 
26       MR. WAIER:  OBJECTION.  LACKS FOUNDATION.  CALLS FOR
 
27  HEARSAY.  SPECULATION.
 
28       THE COURT:  HE CAN SAY YES OR NO IF HE KNOWS THE
			
			

page  102
 
 
 
 1  REASON.  WHY HE KNOWS MAY CALL FOR HEARSAY.
 
 2       THE WITNESS:  WELL, YOUR HONOR, I HAVE TO EXPLAIN THAT
 
 3  MRS. FURR MOVED FROM LOUISIANA TO CALIFORNIA IN 19 --
 
 4  AROUND 1970.  AT THE TIME, THE LEGION WAS PUBLISHING A
 
 5  MAGAZINE, THE AMERICAN MERCURY.  ALMOST ALL OF THE MEMBERS
 
 6  OF THE BOARD LIVED IN THE AREA, AND SHE WOULD MAINTAIN
 
 7  CONTACT WITH THEM ALL.  THEY WERE ALL FRIENDS.  AT THAT
 
 8  TIME, GENERALLY ALL OF THE DIRECTORS SIGNED THE MINUTES.
 
 9            WHEN SHE MOVED BACK TO LOUISIANA, IN 1981 OR
 
10  SOMETHING LIKE THAT, WHY, SHE SORT OF LOST CONTACT WITH THEM
 
11  AND FOR A WHILE REALLY WAS NOT REALLY ACTIVE IN THE AFFAIRS
 
12  WHICH WERE BEING ADMINISTERED, WE THOUGHT, RESPONSIBLY BY
 
13  THE EMPLOYEES.
 
14       MR. BEUGELMANS:  MOVE TO STRIKE.  NONRESPONSIVE, YOUR
 
15  HONOR.
 
16       THE COURT:  IT’s NONRESPONSIVE.  I AM GOING TO LET IT
 
17  STAND.  IT’s IN MY MIND.  I WILL NOT BE ABLE TO GET IT OUT.
 
18
 
19  BY MR. BEUGELMANS:
 
20       Q    DID LAVONNE FURR EVER TELL YOU PRIOR TO 1993 SHE
 
21  WOULD NOT DISCUSS THE AGENDA OF THE ANNUAL MEETINGS WITH THE
 
22  DIRECTORS?
 
23       A    NO.
 
24       MR. WAIER:  OBJECTION.  CALLS FOR HEARSAY.
 
25       THE COURT:  LET THE ANSWER STAND.  OVERRULED.
 
26
 
27  BY MR. BEUGELMANS:
 
28       Q    THE ANSWER IS “NO,” SIR?
			
			

page  103
 
 
 
 1       A    YES.
 
 2       Q    SHE TOLD YOU THAT, CORRECT?
 
 3       A    NO.
 
 4       Q    SHE TOLD YOU SHE WOULD DISCUSS THE AGENDA WITH THE
 
 5  DIRECTORS IN ADVANCE AT THE ANNUAL MEETINGS?
 
 6       A    NO.
 
 7       Q    WHAT DID SHE TELL YOU, SIR?
 
 8       A    I DON'T REMEMBER.
 
 9       Q    THANK YOU.  I WOULD LIKE TO READ FROM THE
 
10  DEPOSITION, SIR, PAGE 165, LINE 2 THROUGH 10.
 
11       MR. WAIER:  165 TO WHAT LINE?
 
12       MR. BEUGELMANS:  2 THROUGH 10.
 
13
 
14  BY MR. BEUGELMANS:
 
15       Q   “QUESTION:  DO YOU KNOW IF LAVONNE FURR WOULD
 
16  DISCUSS THE AGENDA WITH EACH AND EVERY DIRECTOR PRIOR TO AN
 
17  ANNUAL MEETING BEING CALLED?
 
18            “ANSWER:  YES.
 
19            “QUESTION:  AND HOW DO YOU KNOW THAT?
 
20            “ANSWER:  THE” --
 
21            “QUESTION:  AND HOW DO YOU KNOW THAT?
 
22            “ANSWER:  THE ANSWER IS YES, I KNOW THAT SHE WOULD
 
23  NOT.
 
24            “QUESTION:  SHE WOULD NOT?
 
25            “ANSWER:  RIGHT.  IS THAT WHAT I SAID?"
 
26            WHAT CRITERIA DID YOU AND LAVONNE FURR USE IN
 
27  DECIDING WHICH DIRECTORS TO CONTACT TO DISCUSS THE AGENDA IN
 
28  ADVANCE OF AN ANNUAL MEETING?
			
			

page  104
 
 
 
 1       A    WELL, WHEN THERE WERE --
 
 2       MR. WAIER:  EXCUSE ME.  MAY I HEAR THE QUESTION?  I'M
 
 3  SORRY.
 
 4       THE COURT:  YES.  WE HAVE DONE THIS 3 OR 4 TIMES
 
 5  TODAY.  TRY TO LISTEN.  I LISTEN.  I THINK WE GET MAYBE ONE
 
 6  OR TWO OF THESE PER DAY PER PERSON, INCLUDING ME; OTHERWISE,
 
 7  WE'RE NOT PAYING ATTENTION.  IF YOU WANT A BREAK, THEN WE
 
 8  GIVE YOU A BREAK.  TRY TO PAY ATTENTION.  MAYBE THE REPORTER
 
 9  WOULD GRACE US WITH READING THE QUESTION.
 
10                     (THE RECORD WAS READ.)
 
11       MR. WAIER:  OBJECTION.  CALLS FOR SPECULATION WITH
 
12  RESPECT TO LAVONNE FURR.
 
13       THE COURT:  SUSTAINED.
 
14            YOU CAN SAY WHAT HE DID, WHAT HE SAID.
 
15       MR. BEUGELMANS:  THANK YOU.
 
16       THE WITNESS:  SHALL I ANSWER?
 
17       MR. BEUGELMANS:  NO.
 
18       THE COURT:  YOU CAN REPHRASE THE QUESTION.
 
19
 
20  BY MR. BEUGELMANS:
 
21       Q    SIR, PRIOR TO 1993, DID THE LEGION RELY ON THE
 
22  BOARD OF DIRECTORS TO DECIDE ITS BUSINESS AFFAIRS?
 
23       A    NO.
 
24       Q    NOW, AT THE CONCLUSION OF THE LITIGATION INVOLVING
 
25  THE FARREL ESTATE, 45 PERCENT OF THE NET PROCEEDS RECOVERED
 
26  WERE DEPOSITED INTO AN ACCOUNT OR ACCOUNTS OWNED BY VIBET,
 
27  INCORPORATED, CORRECT?
 
28       MR. WAIER:  OBJECTION.  LACKS FOUNDATION.  CALLS FOR
			
			

page  105
 
 
 
 1  LEGAL CONCLUSION.  HEARSAY.
 
 2       THE COURT:  OVERRULED.
 
 3       THE WITNESS:  I THINK SO, BUT I'M NOT CERTAIN.  I
 
 4  WASN'T HANDLING THIS.
 
 5       MR. WAIER:  MOVE TO STRIKE, YOUR HONOR, SINCE THE
 
 6  ANSWER IS OBVIOUSLY SPECULATION.
 
 7       THE COURT:  OVERRULED.
 
 8
 
 9  BY MR. BEUGELMANS:
 
10       Q    DID YOU HIRE ATTORNEY FOETISCH, F-O-E-T-I-S-C-H,
 
11  TO ORGANIZE VIBET, INC.?
 
12       A    I HIRED MR. FOETISCH TO ATTEND TO THE LITIGATION.
 
13  HE DID, AND DOING THAT, HE DID MANY THINGS.  I DIDN'T HIRE
 
14  HIM SPECIFICALLY TO ORGANIZE VIBET.
 
15       Q    DID MR. FOETISCH ORGANIZE VIBET, INC.?
 
16       A    YES.
 
17       Q    DO YOU KNOW WHETHER OR NOT VIBET, INC., IS A SWISS
 
18  CORPORATION?
 
19       A    I'M NOT SURE.
 
20       Q    DO YOU KNOW WHO PAID MR. FOETISCH TO ARRANGE
 
21  VIBET?
 
22       A    HE WAS PAID BY THE FUNDS I RAISED.  THAT WAS PART
 
23  OF HIS FEE.
 
24       Q    ARE YOU SURE OF THAT, SIR?
 
25       A    SURE OF WHAT?
 
26       Q    LET ME ASK YOU THIS:  DO YOU KNOW WHO PAID
 
27  MR. FOETISCH FOR LEGAL WORK INVOLVED IN ORGANIZING VIBET?
 
28       A    I CAN'T RECALL.
			
			

page  106
 
 
 
 1       Q    THANK YOU, SIR.
 
 2            BY THE WAY, HAVE YOU EVER SEEN A BALANCE SHEET FOR
 
 3  VIBET, INC.?
 
 4       A    NOPE.
 
 5       Q    WHY WAS VIBET, INC., SET UP?
 
 6       MR. WAIER:  OBJECTION.  CALLS FOR LEGAL CONCLUSION.
 
 7  LACKS FOUNDATION.  HEARSAY.
 
 8       THE COURT:  OVERRULED.
 
 9       THE WITNESS:  BECAUSE AT THAT TIME, THE LEGION HAD BEEN
 
10  UNDER EXTREMELY HEAVY ATTACK IN MANY WAYS, PARTICULARLY
 
11  INCLUDING A LAWSUIT WHICH WAS DESIGNED TO WRECK IT.  THIS
 
12  WAS A YEAR, 2 — THIS WAS A YEAR AFTER THE TOTAL DESTRUCTION
 
13  BY ARSON OF THE INSTITUTE.  THE INSTITUTE WAS BANKRUPT.
 
14  WITH THIS MONEY COMING IN, I DON'T THINK ANY RESPONSIBLE OR
 
15  HONEST PERSON CONNECTED WOULD OBJECT TO THE — TO THE
 
16  SEQUESTERIZATION OF ASSETS SO THEY WOULDN'T BE AVAILABLE TO
 
17  ANY PLAINTIFF WHO WAS TRYING TO DESTROY THE LEGION.
 
18
 
19  BY MR. BEUGELMANS:
 
20       Q    SO IN OTHER WORDS, SIR, THE MONEY WAS PUT INTO
 
21  VIBET IN ANTICIPATION OF A POSSIBLE JUDGMENT AGAINST THE
 
22  LEGION, CORRECT?
 
23       A    THAT IS CORRECT, UPON THE ADVICE OF MR. HULSY.
 
24       MR. BEUGELMANS:  MOVE TO STRIKE THE LATTER PART OF THE
 
25  SENTENCE — RESPONSE.
 
26       THE COURT:  I'LL SUSTAIN THE OBJECTION.
 
27
 
28
			
			

page  107
 
 
 
 1  BY MR. BEUGELMANS:
 
 2       Q    SIR, HAVE YOU EVER HEARD OF A BUSINESS CALLED
 
 3  BANQUE CANTRADE, C-A-N-T-R-A-D-E, LAUSANNE, L-A-U-S-A-N-N-E?
 
 4       A    YES.
 
 5       Q    IS IT INTO THE BANQUE CANTRADE LAUSANNE THAT VIBET
 
 6  DEPOSITED THE 45 PERCENT RECOVERY OF THE FARREL ESTATE AFTER
 
 7  DEDUCTION OF FEES, TAXES, ETC.?
 
 8       MR. WAIER:  OBJECTION.  LACKS FOUNDATION.  HEARSAY.
 
 9  SPECULATION.  RELEVANCY.
 
10       THE COURT:  OVERRULED.
 
11       THE WITNESS:  THAT WAS A VERY COMPLEX PROCESS.  THE
 
12  ASSETS WERE, TO A LARGE EXTENT, IN VARIOUS ACCOUNTS, BROKER
 
13  ACCOUNTS IN ENGLAND.  NOT SOLELY — HOWEVER, THE JOB OF
 
14  MR. ROCHAT WAS TO GATHER ALL THIS — ALL THE ASSETS
 
15  TOGETHER.  IN DOING THAT, THERE WERE A LARGE NUMBER OF BANKS
 
16  THAT WERE USED, AND BANQUE CANTRADE PLAYED A PART IN THAT.
 
17  I DIDN'T HAVE ANYTHING TO DO WITH IT.  IT WAS DONE BY
 
18  MR. FOETISCH AND THE NOTARY WHO WAS EMPLOYED BY AND TOOK
 
19  ORDERS FROM MR. FOETISCH.
 
20       MR. BEUGELMANS:  MOVE TO STRIKE AS NONRESPONSIVE, YOUR
 
21  HONOR.
 
22       THE COURT:  OVERRULED.
 
23
 
24  BY MR. BEUGELMANS:
 
25       Q    DID YOU INSTRUCT MR. FOETISCH TO FORM VIBET,
 
26  INC.?
 
27       A    I CAN'T SAY I DID.
 
28       Q    DO YOU KNOW WHO DID?
			
			

page  108
 
 
 
 1       A    WHO INSTRUCTED HIM?
 
 2       Q    YES.
 
 3       A    WELL, I GUESS IT DEPENDS ON YOUR DEFINITION OF THE
 
 4  WORD “INSTRUCT.”  I — I REALLY DON'T RECALL PUTTING FORTH
 
 5  AS A HYPOTHESIS.  IT’s VERY POSSIBLE HE MIGHT HAVE SUGGESTED
 
 6  IT AND — BUT MORE THAN THAT, I CAN'T SAY.
 
 7       Q    DO YOU KNOW IF HENRY FISCHER INSTRUCTED
 
 8  MR. FOETISCH TO FORM VIBET?
 
 9       A    THAT COULD BE.
 
10       MR. WAIER:  I'M GOING TO OBJECT, YOUR HONOR.  CALLS FOR
 
11  HEARSAY.  LACKS FOUNDATION.
 
12       THE COURT:  HE SAYS HE DOESN'T KNOW.
 
13
 
14  BY MR. BEUGELMANS:
 
15       Q    SIR, AS OF MARCH 1987, HAD THE LEGION RELINQUISHED
 
16  ITS INTEREST IN THE FARREL BEQUEST TO YOU?
 
17       A    THAT CALLS FOR A LEGAL CONCLUSION.  I CAN'T ANSWER
 
18  THAT.
 
19       Q    HAVE YOU EVER MADE A STATEMENT, SIR, AS OF
 
20  MARCH 3, 1987, THE LEGION HAD RELINQUISHED ITS INTEREST IN
 
21  THE FARREL ESTATE TO YOU?
 
22       A    WELL, IN LAYMEN’s TERMS, I THINK THAT WOULD BE A
 
23  FAIR APPROXIMATION OF WHAT HAPPENED.  TO MY DIRECTION, NOT
 
24  TO ME.  I NEVER GOT A CENT OUT OF IT.
 
25       Q    I WOULD LIKE TO READ YOUR DEPOSITION, PAGE 70,
 
26  LINE 15 THROUGH 19.
 
27            “QUESTION:  AS OF MARCH 3, 1987, HAD THE BOARD OF
 
28  DIRECTORS OF THE LEGION RELINQUISHED ANY INTEREST THEY MIGHT
			
			

page  109
 
 
 
 1  HAVE, THAT THE CORPORATION MIGHT HAVE IN THE FARREL ESTATE
 
 2  TO YOU?
 
 3            “ANSWER:  YES."
 
 4            SIR, DO YOU RECALL WHETHER OR NOT YOU EVER
 
 5  SUGGESTED TO THE FURRS THAT THE LEGION MIGHT HIRE AN
 
 6  ATTORNEY ON A CONTINGENT FEE BASIS TO PURSUE THE FARREL
 
 7  ESTATE?
 
 8       MR. WAIER:  YOUR HONOR, WE HAD A STANDING ORDER THAT
 
 9  WITNESSES WERE TO BE EXCLUDED FROM THIS COURTROOM.
 
10  MR. MARCELLUS HEARD THAT ORDER AT THE TIME WHEN IT WAS
 
11  CALLED.  HE’s BEEN SITTING IN HERE, I NOTICED, THIS ENTIRE
 
12  TIME.  THERE’s A — HE’s VIOLATING THIS COURT ORDER.
 
13       THE COURT:  THAT’s RIGHT.  HE SHOULD BE OUTSIDE.  I
 
14  DIDN'T NOTICE HIM.
 
15       MR. BEUGELMANS:  I DIDN'T EITHER.
 
16
 
17  BY MR. BEUGELMANS:
 
18       Q    SIR, DO YOU CONSIDER THAT YOU PERSONALLY WERE
 
19  ENTITLED TO 100 PERCENT OF THE 45 PERCENT RECOVERY THAT WENT
 
20  TO THE LEGION AFTER PAYMENT OF TAXES, EXPENSES AND ALL OTHER
 
21  FEES?
 
22       A    IN MY OWN MIND, I'M ABSOLUTELY CONVINCED WITHOUT
 
23  ANY POSSIBILITY OF A DOUBT THAT I SHOULD HAVE HAD AND DID
 
24  HAVE TOTAL CONTROL OVER THE RECOVERY OF THE FUNDS.
 
25       MR. BEUGELMANS:  MOVE TO STRIKE.  NONRESPONSIVE.
 
26       THE COURT:  OVERRULED.
 
27
 
28
			
			

page  110
 
 
 
 1  BY MR. BEUGELMANS:
 
 2       Q    THE QUESTION IS, SIR, DO YOU CONTEND THAT YOU
 
 3  PERSONALLY WERE ENTITLED TO A SHARE OF THE PROCEEDS OF THE
 
 4  FARREL ESTATE?
 
 5       A    MR. BEUGELMANS, LET ME POINT OUT THERE’s A
 
 6  DIFFERENCE IN LAW BETWEEN CONTROL AND OWNERSHIP.  I NEVER
 
 7  CONSIDERED I HAD OWNERSHIP OF THE FARREL ESTATE.  NEVER.  I
 
 8  DID CONSIDER I HAD TOTAL CONTROL OVER IT, YES.
 
 9       Q    LET ME READ FROM THE DEPOSITION, PAGE 21 LINE 24
 
10  TO PAGE 22 LINE 8.
 
11            “QUESTION:  DO YOU CONTEND, SIR, THAT YOU
 
12  PERSONALLY WERE ENTITLED TO A SHARE OF THE PROCEEDS OF THE
 
13  FARREL ESTATE?"
 
14       MR. WAIER:  I'M SORRY.  LINE?  I'M SORRY.
 
15       MR. BEUGELMANS:  LINE 24.
 
16            MAY I START AGAIN, YOUR HONOR?
 
17
 
18  BY MR. BEUGELMANS:
 
19       Q   “QUESTION:  DO YOU CONTEND, SIR, THAT YOU
 
20  PERSONALLY WERE ENTITLED TO A SHARE OF THE PROCEEDS OF THE
 
21  FARREL ESTATE?
 
22            “ANSWER:  NO, UNLESS YOU CONSIDER 100 PERCENT
 
23  A SHARE.
 
24            “QUESTION:  DO YOU CONSIDER, SIR, THAT YOU WERE
 
25  ENTITLED TO A 100 PERCENT PORTION OF THE FARREL ESTATE?
 
26            “ANSWER:  YES."
 
27            AND WAS THAT 100 PERCENT TO BE 45 PERCENT THAT WAS
 
28  DISTRIBUTED TO VIBET?
			
			

page  111
 
 
 
 1       MR. WAIER:  I RAISED AN OBJECTION AT THAT TIME, YOUR
 
 2  HONOR.  LACKS FOUNDATION.  CALLS FOR SPECULATION.  ASSUMES
 
 3  FACTS 45 PERCENT WAS DISTRIBUTED TO VIBET.  THERE’s BEEN NO
 
 4  TESTIMONY TO THAT EFFECT.  VAGUE AND AMBIGUOUS AS PHRASED.
 
 5       THE COURT:  OVERRULED.
 
 6       THE WITNESS:  IS THAT A QUESTION?
 
 7
 
 8  BY MR. BEUGELMANS:
 
 9       Q    YES, SIR.
 
10       A    WELL, I SAY I THINK YOU HAVE A CONFUSION IN YOUR
 
11  MIND, SIR, AS TO POSSESSION AND CONTROL.  I NEVER TOOK ANY
 
12  MONEY OF THE FARREL ESTATE FOR MYSELF.  I DID REPAY WHAT I
 
13  HAD ADVANCED AS FAR AS TRAVEL EXPENSES AS FAR AS I WAS
 
14  ABLE.  I DIDN'T MAKE A DIME OUT OF THE FARREL ESTATE.  I HAD
 
15  TOTAL CONTROL OVER IT.  THAT’s ALL I CAN SAY.
 
16       Q    SIR, IN YOUR CAPACITY AS CHIEF EXECUTIVE OFFICER,
 
17  TREASURER AND DIRECTOR OF LIBERTY LOBBY, INC. — ARE YOU
 
18  PAID A SALARY?
 
19       MR. WAIER:  OBJECTION.  I INDICATED THAT THIS INVOLVED
 
20  LIBERTY LOBBY AND INDICATED HE WOULD WAIT ON THE QUESTIONS.
 
21       THE COURT:  THAT’s CORRECT.
 
22
 
23  BY MR. BEUGELMANS:
 
24       Q    OKAY.  SIR, DID YOU EVER PREPARE AN ACCOUNTING,
 
25  COMPLETE ACCOUNTING OF THE 45 PERCENT NET SHARE OF THE
 
26  FARREL ESTATE AFTER DEDUCTION OF ATTORNEY FEES, TAXES, COSTS
 
27  AND RELATED EXPENSES?
 
28       A    NO.
			
			

page  112
 
 
 
 1       Q    SIR, IS IT TRUE THAT YOU HAVE STATED IN THE PAST
 
 2  THAT THE NET RECOVERY, THE 45 PERCENT SHARE AFTER PAYMENT OF
 
 3  FEES, TAXES AND COSTS, WAS BETWEEN 3 AND 4 MILLION DOLLARS?
 
 4       A    YES.
 
 5       Q    WAS THAT A TRUE STATEMENT?
 
 6       A    YES.
 
 7       Q    SIR, WHAT HAPPENED TO THE UNSET GEMS --
 
 8       MR. WAIER:  OBJECTION.
 
 9
 
10  BY MR. BEUGELMANS:
 
11       Q    — THAT THE LEGION RECEIVED AS ITS SHARE OF THE 45
 
12  PERCENT OF THE DISTRIBUTION?
 
13       MR. WAIER:  OBJECTION.  LACKS FOUNDATION.
 
14       THE COURT:  OVERRULED.
 
15       MR. WAIER:  MAY I BE HEARD ON THAT?
 
16       THE COURT:  NO.
 
17       THE WITNESS:  MY UNDERSTANDING IS THAT THE LEGION DID
 
18  NOT RECEIVE THIS MONEY.  THE MONEY WAS RECEIVED, AS
 
19  MR. WAIER POINTED OUT THIS MORNING BY A DOCUMENT, AS SHOWN
 
20  BY MYSELF AND THE LEGION.  LEGION DIDN'T — YOUR QUESTION
 
21  DOES NOT REFLECT THAT FACT.
 
22            AS FAR AS THE DIAMONDS, THE GEMS, WHATEVER THEY
 
23  WERE — I'M NOT SURE THEY WERE ALL DIAMONDS.  I FORGET.
 
24  BUT ALL THIS, THIS WAS MR. ROCHAT’s JOB TO GATHER ALL
 
25  THIS — ALL THE ASSETS TOGETHER AND TURN THEM INTO CASH IN
 
26  ORDER TO RECOVER THE MONEY INVOLVED, THE ASSETS OF NECA.
 
27
 
28
			
			

page  113
 
 
 
 1  BY MR. BEUGELMANS:
 
 2       Q    SO THE ANSWER IS YOU DON'T KNOW WHAT HAPPENED TO
 
 3  THE GEMS?
 
 4       A    I THINK I JUST EXPLAINED TO YOU WHAT HAPPENED TO
 
 5  THE GEMS.  MR. ROCHAT WOULD BE THE MAN THAT COULD SWEAR WHAT
 
 6  HAPPENED TO THE GEMS.
 
 7       Q    DID — STRIKE THAT.
 
 8            WHO WAS ROLAND ROCHAT?
 
 9       A    A NOTARY IN SWITZERLAND.  I'M SURE YOU REALIZE,
 
10  MR. BEUGELMANS, A NOTARY IN MANY LATIN COUNTRIES OVERSEAS IS
 
11  QUITE DIFFERENT FROM A NOTARY PUBLIC HERE.  THEY HAVE LEGAL
 
12  RESPONSIBILITIES.  THEY ARE MORE OR LESS ON THE SAME LEVEL
 
13  OF AN ATTORNEY.
 
14       Q    IS MR. ROLAND ROCHAT A NOTAIRE, N-O-T-A-I-R-E?
 
15       A    WHAT?
 
16       Q    IS HE A NOTAIRE?
 
17       A    WELL, I THINK THAT’s WHAT IS ON HIS SHINGLE.
 
18       Q    DO YOU KNOW WHAT A SOLICITOR IS UNDER ENGLISH LAW?
 
19       A    IN SWITZERLAND, THEY DON'T HAVE THAT SYSTEM.
 
20       Q    DO YOU KNOW IF A NOTAIRE UNDER SWISS LAW IS THE
 
21  SAME THING OR SIMILAR TO A SOLICITOR UNDER, I THINK, ENGLISH
 
22  LAW?
 
23       A    I DON'T THINK SO.
 
24       Q    DID YOU HIRE — PERSONALLY, DID YOU HIRE ANY
 
25  SOLICITORS IN ENGLAND TO PURSUE THE FARREL ESTATE?
 
26       A    YES.  FOR THE LEGION I DID, YES.
 
27       Q    AND WHAT WAS THE NAME OF THE SOLICITOR YOU HIRED
 
28  IN ENGLAND, SIR?
			
			

page  114
 
 
 
 1       A    HOOPER, H, DOUBLE O, P-E-R.
 
 2       Q    WAS MR. HOOPER PAID FOR HIS SERVICES FROM THE NET
 
 3  RECOVERY AFTER PAYMENT OF ATTORNEY FEES, COSTS AND EXPENSES?
 
 4       A    HE WAS OVERPAID.
 
 5       Q    IS THE ANSWER “YES,” SIR?
 
 6       A    HE WAS INDEED PAID.
 
 7       Q    AND HE DEFERRED RECEIPT OF FUNDS UNTIL THE
 
 8  SETTLEMENT WAS EFFECTED, CORRECT?
 
 9       A    YES, I BELIEVE SO.
 
10       Q    NOW, SIR, DID YOU EVER SUGGEST TO THE OTHER
 
11  MEMBER — SO-CALLED MEMBER OF THE LEGION THAT OTHER THAN
 
12  MR. HOOPER, THE LEGION MIGHT SECURE ATTORNEYS REPRESENTED IN
 
13  CONNECTION WITH THE FARREL LITIGATION ON A CONTINGENT FEE
 
14  BASIS?
 
15       MR. WAIER:  OBJECTION.  LACKS FOUNDATION.
 
16  SPECULATION.  RELEVANCY, YOUR HONOR.
 
17       THE COURT:  OVERRULED.
 
18       THE WITNESS:  MR. BEUGELMANS, I DON'T KNOW.  I MAY HAVE
 
19  DONE THAT.  I MAY HAVE ATTEMPTED TO DO THAT.  I SOON FOUND
 
20  OUT IT WAS IMPOSSIBLE TO DO THAT WITH ALL THE ATTORNEYS THAT
 
21  I DEALT WITH AND THERE WERE NUMEROUS.  THEY ALL REQUIRED
 
22  PAYMENT UP FRONT.
 
23
 
24  BY MR. BEUGELMANS:
 
25       Q    EXCEPT HOOPER, CORRECT?
 
26       A    WELL, NO.  HOOPER WAS PAID ALL ALONG.  AT THE END,
 
27  HE SUBMITTED A HUGE BILL, WHICH WASN'T REFLECTIVE OF HIS --
 
28  IN MY OPINION, WAS NOT REFLECTIVE OF HIS SERVICES.  SO WE
			
			

page  115
 
 
 
 1  DISPUTED THAT.
 
 2       Q    DID HOOPER EVER — STRIKE THAT.
 
 3            DID HOOPER EVER PRESENT TO YOU, WILLIS CARTO, A
 
 4  BREAKDOWN OF THE FARREL RECOVERY?
 
 5       A    WELL, THROUGH HIS OFFICES.  WE WERE PRESENTED WITH
 
 6  ACCOUNT STATEMENTS OF THE ACCOUNT, OF COURSE, BY — FROM
 
 7  THE BROKERS.  I DON'T KNOW IF THEY CAME TO HIM.  NO, I THINK
 
 8  THEY CAME TO ME DIRECTLY.
 
 9       Q    DID YOU EVER RECEIVE A LETTER FROM MR. HOOPER
 
10  DETAILING THE BREAKDOWN OF THE FARREL RECOVERY?
 
11       A    I DON'T RECALL.
 
12       Q    SIR, I WOULD LIKE YOU TO LOOK AT YOUR DEPOSITION,
 
13  EXHIBIT 5 TO YOUR DEPOSITION, AND ASK YOU IF EXHIBIT 5 TO
 
14  THE DEPOSITION REFRESHES YOUR RECOLLECTION AS TO WHETHER OR
 
15  NOT YOU RECEIVED A LETTER FROM MR. HOOPER DETAILING THE
 
16  BREAKDOWN OF THE RECOVERY OF THE FARREL ESTATE.
 
17       THE COURT:  IS THAT THE SAME EXHIBIT AS 46?
 
18       MR. BEUGELMANS:  YES, I BELIEVE.  THAT’s THE LETTER OF
 
19  JUNE 5, 1991.
 
20       THE WITNESS:  WHAT’s YOUR QUESTION?
 
21
 
22  BY MR. BEUGELMANS:
 
23       Q    DID YOU RECEIVE THIS LETTER, SIR?
 
24       A    I SUPPOSE I DID, IN 1991.
 
25       Q    DID YOU READ THIS LETTER WHEN YOU RECEIVED IT,
 
26  SIR?
 
27       A    I SUPPOSE.
 
28       Q    DID YOU EVER SEND A LETTER BACK TO MR. HOOPER
			
			

page  116
 
 
 
 1  DISPUTING THE CONTENTS OF EXHIBIT 46?
 
 2       A    I DON'T REMEMBER.
 
 3       Q    IS THE PERSON REFERRED TO AS “MAITRE ROCHAT” AT
 
 4  PAGE 3 OF EXHIBIT 46 — IS THAT ROLAND ROCHAT?
 
 5       A    YES.
 
 6       Q    DID THE LEGION EVER BORROW MONEY TO FINANCE THE
 
 7  FARREL LITIGATION?
 
 8       A    MY RECOLLECTION IS THAT THE FUNDS WERE BORROWED IN
 
 9  MY NAME.  I'M NOT — I'M NOT — I CAN'T ANSWER THAT
 
10  QUESTION.
 
11       Q    SO THE ANSWER IS YOU DON'T RECALL, CORRECT?
 
12       A    RIGHT.
 
13       Q    TAKE A LOOK AT EXHIBIT 21.
 
14       A    YES.
 
15       Q    WOULD YOU LOOK AT THE LAST PAGE, SIR.
 
16       A    YES.
 
17       Q    IS EXHIBIT 21 A COPY OF AN ORIGINAL?
 
18       MR. WAIER:  OBJECTION.  LACKS FOUNDATION.
 
19       THE COURT:  OVERRULED.
 
20       THE WITNESS:  IS IT A COPY OF THE ORIGINAL?  IS THAT
 
21  WHAT YOUR QUESTION IS?
 
22
 
23  BY MR. BEUGELMANS:
 
24       Q    YES, AN AUTHENTIC COPY.
 
25       A    IT SEEMS TO BE.  I WOULD ACCEPT IT.  IT LOOKS
 
26  FAMILIAR.
 
27       Q    DO YOU SEE YOUR SIGNATURE UNDER YOUR NAME AT THE
 
28  LAST PAGE, PAGE 12?
			
			

page  117
 
 
 
 1       A    I CERTAINLY DON'T.
 
 2       MR. WAIER:  YOU SAY EXHIBIT 21?
 
 3       MR. BEUGELMANS:  THE DISTRIBUTION AGREEMENT.
 
 4       MR. WAIER:  EXHIBIT 21?
 
 5       MR. BEUGELMANS:  EXCUSE ME, EXHIBIT 20.
 
 6       MR. WAIER:  I DON'T HAVE EXHIBIT 20.
 
 7       THE WITNESS:  THE SAME THING AS UP THERE, DISTRIBUTION
 
 8  AGREEMENT.
 
 9
 
10  BY MR. BEUGELMANS:
 
11       Q    DO YOU SEE THE DISTRIBUTION AGREEMENT, EXHIBIT 20?
 
12       A    YES.
 
13       Q    IS EXHIBIT 20 AUTHENTIC?
 
14       A    YES, I BELIEVE IT TO BE SO.
 
15       Q    DO YOU SEE AT PAGE 12 OF EXHIBIT 20 THERE’s A
 
16  SIGNATURE ON BEHALF OF THE LEGION AND ONE ON BEHALF OF
 
17  WILLIS CARTO?
 
18       A    YES.
 
19       Q    DID YOU AUTHORIZE ANYONE TO AFFIX THAT SIGNATURE
 
20  ON YOUR BEHALF?
 
21       A    I'M SURE I MUST.
 
22       Q    DO YOU RECALL WHO IT WAS THAT SIGNED THIS DOCUMENT
 
23  ON YOUR BEHALF?
 
24       A    IT WOULD HAVE BEEN EITHER MR. ROCHAT, I WOULD
 
25  SUPPOSE — I'M SPECULATING.  I THINK IT WOULD BE EITHER
 
26  MR. ROCHAT OR MR. FOETISCH.
 
27       MR. WAIER:  MOVE TO STRIKE.  WITNESS INDICATED HE'S
 
28  SPECULATING.
			
			

page  118
 
 
 
 1       THE COURT:  I'LL STRIKE HIS ANSWER.
 
 2
 
 3  BY MR. BEUGELMANS:
 
 4       Q    ARE YOU DISPUTING THAT THE PERSON WHO SIGNED
 
 5  EXHIBIT 20 ON YOUR BEHALF WAS AUTHORIZED TO DO SO?
 
 6       A    NO.  I'M ANSWERING YOUR QUESTION.
 
 7       Q    THANK YOU, SIR.  IF YOU WOULD, SIR, PLEASE TURN TO
 
 8  EXHIBIT 29.
 
 9       A    YES.
 
10       Q    HAVE YOU SEEN THIS DOCUMENT BEFORE, SIR?
 
11       A    I BELIEVE SO.
 
12       Q    IS THIS DOCUMENT AN AUTHENTIC COPY OF AN ORIGINAL?
 
13       A    I WOULD SUPPOSE.
 
14       Q    DO YOU KNOW IF THIS DOCUMENT WAS EVER SIGNED BY
 
15  ANYBODY?
 
16       A    WELL, I WOULD SUPPOSE THAT THE ORIGINAL — IT WAS
 
17  SIGNED BY MRS. FURR.  THIS IS A COPY BEFORE SHE SIGNED IT.
 
18       Q    THANK YOU, SIR.
 
19            NOW, WAS THERE A TIME WHEN LAVONNE FURR RESIGNED
 
20  AS A DIRECTOR OF THE LEGION?
 
21       A    THAT IS A LEGAL QUESTION.  SHE WAS FORCED OUT BY
 
22  THREATS, SHE AND HER HUSBAND, AND WHICH, IN OUR VIEW, WAS
 
23  NOT A LEGAL RESIGNATION.  AND SHE REPUDIATED HER
 
24  RESIGNATION.
 
25       Q    ARE YOU REFERRING TO THE RESIGNATION THAT OCCURRED
 
26  IN SEPTEMBER 1993, CORRECT?
 
27       A    YES.
 
28       Q    PRIOR TO THAT TIME, HAD LAVONNE FURR EVER RESIGNED
			
			

page  119
 
 
 
 1  FROM THE POSITION AS A DIRECTOR OF THE LEGION?
 
 2       A    I REALLY DON'T RECALL.  I DON'T THINK SO.  I COULD
 
 3  BE WRONG.
 
 4       Q    DO YOU RECALL THERE WAS A TIME MORE THAN 15 YEARS
 
 5  AGO THAT LAVONNE FURR FELT SHE HAD A CONFLICT OF INTEREST
 
 6  WITH THE LEGION?
 
 7       A    NO.
 
 8       Q    DID LAVONNE FURR TELL YOU SHE RESIGNED AS A
 
 9  DIRECTOR?
 
10       MR. WAIER:  OBJECTION.  RELEVANCY.
 
11       THE COURT:  OVERRULED.
 
12       THE WITNESS:  WELL, MR. BEUGELMANS, IF I SEEM VAGUE
 
13  ABOUT THIS, IT’s BECAUSE MY MIND HAS BEEN FOCUSSED ON A LOT
 
14  OF OTHER THINGS IN THE PIDDLING DETAILS, NAMELY KEEPING THE
 
15  THING ALIVE, RAISING MONEY FOR IT AND KEEPING IT A VIABLE
 
16  INSTITUTION.  AS FAR AS THE PAPERWORK, I JUST DON'T RECALL
 
17  ALL THE DETAILS.  AND INCONSEQUENTIAL, THEY MEAN NOTHING TO
 
18  THE PROPER FUNCTIONING OF THE LEGION, WHICH, UNTIL IT WAS
 
19  DESTROYED, WAS VERY CONTROVERSIAL, BUT AN INSTITUTION
 
20  RESPECTED ALL AROUND THE WORLD.
 
21       MR. BEUGELMANS:  MOVE TO STRIKE AS NONRESPONSIVE, YOUR
 
22  HONOR.
 
23       THE COURT:  SUSTAIN THE OBJECTION.
 
24
 
25  BY MR. BEUGELMANS:
 
26       Q    MR. CARTO, DID LAVONNE FURR EVER TELL YOU PRIOR TO
 
27  SEPTEMBER 1993 THAT SHE HAD RESIGNED AS A DIRECTOR OF THE
 
28  LEGION?
			
			

page  120
 
 
 
 1       A    AS I SAID, I BELIEVE I DON'T RECALL THAT SHE DID.
 
 2       Q    THANK YOU, SIR.
 
 3            PRIOR TO SEPTEMBER 1993, DID LAVONNE FURR EVER
 
 4  TELL YOU SHE FELT SHE HAD A CONFLICT OF INTEREST WITH THE
 
 5  LEGION?
 
 6       A    I DON'T SEE HOW SHE COULD HAVE A CONFLICT OF
 
 7  INTEREST.
 
 8       Q    DID SHE MAKE THAT STATEMENT TO YOU?
 
 9       A    I DON'T REMEMBER HER MAKING THE STATEMENT TO ME.
 
10       Q    THANK YOU, SIR.
 
11            DOES VIBET, INC., STILL HAVE MONEY IN THE BANQUE
 
12  CANTRADE ACCOUNT IN SWITZERLAND?
 
13       MR. WAIER:  OBJECTION.  LACKS FOUNDATION.  CALLS FOR
 
14  HEARSAY.  SPECULATION.  BEST EVIDENCE.
 
15       THE COURT:  OVERRULED.
 
16       THE WITNESS:  I DON'T KNOW.
 
17
 
18  BY MR. BEUGELMANS:
 
19       Q    AS OF THE TIME OF YOUR DEPOSITION WHEN YOU
 
20  WERE — AS OF THE TIME OF YOUR DEPOSITION ONE YEAR AGO,
 
21  SIR, IN 1995, DID VIBET, INC., STILL HAVE MONEY ON ACCOUNT
 
22  AT BANQUE CANTRADE LAUSANNE, SWITZERLAND?
 
23       A    WELL, I THINK IT DID.
 
24       Q    DO YOU KNOW HOW MUCH?
 
25       A    NO.
 
26       Q    WAS IT APPROXIMATELY $200,000?
 
27       A    I DON'T KNOW.
 
28       Q    DID YOU EVER TELL ANYBODY ON OR ABOUT OCTOBER 17,
			
			

page  121
 
 
 
 1  1995, THAT VIBET, INC., HAD APPROXIMATELY $200,000 ON
 
 2  DEPOSIT AT BANQUE CANTRADE, LAUSANNE, SWITZERLAND?
 
 3       MR. WAIER:  OBJECTION.  CALLS FOR POTENTIAL DISCLOSURE
 
 4  OF ATTORNEY/CLIENT PRIVILEGE COMMUNICATION.
 
 5       THE COURT:  EXCLUDING TELLING YOUR ATTORNEY,
 
 6  OBVIOUSLY.
 
 7       MR. WAIER:  ALSO, I WOULD — IT DEPENDS ON THE CONTEXT
 
 8  WHICH THIS IS DONE.  THIS MAY HAVE BEEN IN THE THROES OF A
 
 9  SETTLEMENT NEGOTIATION.  IN THAT REGARD, I OBJECT ON THAT
 
10  GROUND.  SETTLEMENT NEGOTIATIONS ARE NOT RELEVANT.
 
11       THE COURT:  THIS DOESN'T GET INTO ANY SETTLEMENT.  IT'S
 
12  A SIMPLE QUESTION.  WAS THERE MONEY?  IF SO, HOW MUCH ON
 
13  OCTOBER 15, 1995?  BANQUE CANTRADE HAS NOTHING TO DO WITH
 
14  THE SETTLEMENT I CAN SEE.  HE MAY ANSWER THE QUESTION IF YOU
 
15  KNOW THE ANSWER.
 
16       THE WITNESS:  THE QUESTION IS DID I EVER TELL ANYBODY
 
17  ON WHAT DATE?
 
18
 
19  BY MR. BEUGELMANS:
 
20       Q    APPROXIMATELY OCTOBER 17, 1995, THAT VIBET, INC.,
 
21  HAD ABOUT $200,000 ON DEPOSIT AT BANQUE CANTRADE LAUSANNE?
 
22       A    I DON'T REMEMBER.
 
23       MR. BEUGELMANS:  YOUR HONOR --
 
24       THE COURT:  3 O'CLOCK.  TAKE A BREAK.  SEE YOU IN 10
 
25  MINUTES.
 
26
 
27                   (PROCEEDINGS RECESSED.)
 
28
			
			

page  122
 
 
 
 1       THE COURT:  GO AHEAD.
 
 2       MR. BEUGELMANS:  YOUR HONOR, PROCEDURAL POINT.  I USED
 
 3  THE DEPOSITION FROM THE CASE OF MEL MERMELSTEIN VERSUS THE
 
 4  OTHER COUNTY ACTION EARLIER.  SHOULD I LODGE THAT WITH THE
 
 5  COURT?
 
 6       MR. WAIER:  WHICH ONE?
 
 7       MR. BEUGELMANS:  MERMELSTEIN VS. LEGION, CASE 629224.
 
 8       THE COURT:  NO, I DON'T NEED IT.  I'M NOT GOING TO READ
 
 9  IT.
 
10       MR. BEUGELMANS: THANK YOU.
 
11            QUESTION TO THE COURT.  I CAN'T GO INTO QUESTIONS
 
12  ABOUT LIBERTY LOBBY WITH THIS QUESTION.  I WILL COVER A FEW
 
13  MORE POINTS.  I WANT TO RESERVE THE RIGHT, PERHAPS, TO --
 
14  DEPENDING ON THE ANSWERS HE GIVES WHEN HE QUESTIONS — HE
 
15  ANSWERS QUESTIONS ABOUT OTHER ENTITIES, MAY OPEN THE DOOR.
 
16       THE COURT:  I'M TRYING TO BE FAIR TO MR. LANE, WHO
 
17  REPRESENTS LIBERTY LOBBY.  IF IT GETS CLOSE TO LIBERTY
 
18  LOBBY, WE'LL ALL BE HERE NEXT WEEK.
 
19       MR. BEUGELMANS:  I'LL STAY AWAY UNTIL NEXT WEEK.  IF I
 
20  ASK A QUESTION, PERHAPS TANGENTIAL, NOT RIGHT ON POINT.
 
21  THANK YOU.
 
22
 
23  BY MR. BEUGELMANS:
 
24       Q    MR. CARTO, AS OF THE DATE OF YOUR DEPOSITION,
 
25  OCTOBER 17, 1995, DID THE LEGION OWE VIBET $250,000?
 
26       A    THERE WAS A CONSIDERABLE DEBT, MR. BEUGELMANS.  I
 
27  CAN'T RECITE SPECIFICALLY THE AMOUNT.
 
28       Q    I WOULD LIKE TO SHOW YOU YOUR DEPOSITION
			
			

page  123
 
 
 
 1  TRANSCRIPT, PAGE 115, ASK IF THAT REFRESHES YOUR
 
 2  RECOLLECTION TO THE AMOUNT OF THE DEBT WHICH YOU CONTEND
 
 3  LEGION OWED VIBET AS OF OCTOBER 1985?
 
 4       MR. WAIER:  WHAT PAGE?
 
 5       MR. BEUGELMANS:  115, SIR.
 
 6       THE WITNESS:  OKAY.  THANK YOU.
 
 7
 
 8  BY MR. BEUGELMANS:
 
 9       Q    WAS IT YOUR TESTIMONY AT THAT TIME THAT LEGION,
 
10  THE PLAINTIFF IN THIS CASE, OWES VIBET, INCORPORATED,
 
11  $250,000?
 
12       A    I THINK MY ANSWER REFERRED TO 187,000, AND THEN I
 
13  WAS CORRECTED BY MR. WAIER, I BELIEVE.  YES, IT WAS A FIGURE
 
14  CLOSE TO THAT.
 
15       Q    DIDN'T YOU ADOPT MR. WAIER’s STATEMENT THAT VIBET
 
16  OWES — STRIKE THAT, THE LEGION OWES VIBET $250,000?
 
17       A    I BELIEVE I DID.
 
18       Q    THANK YOU, SIR.  EARLIER, MR. CARTO, IN YOUR
 
19  TESTIMONY, YOU STATED THAT YOU HAVE CONTROL OVER THE 45
 
20  PERCENT SETTLEMENT PROCEEDS FROM THE FARREL LITIGATION, BUT
 
21  YOU DON'T HAVE OWNERSHIP; IS THAT CORRECT?
 
22       A    CORRECT.
 
23       Q    WHO OWNED THAT MONEY?
 
24       A    PARDON?
 
25       Q    WHO DID OWN THAT MONEY?
 
26       A    THE MONEY WAS DISTRIBUTED ACCORDING TO MY
 
27  DIRECTION, AND THEN WHEN IT WAS DISTRIBUTED EITHER AS LOANS
 
28  OR GIFTS, WHY, IT BECAME THE PROPERTY OF THE DISTRIBUTION.
			
			

page  124
 
 
 
 1       Q    AT THE MOMENT YOU MADE THE DISTRIBUTIONS, BEFORE
 
 2  THE DISTRIBUTIONS WERE CONSUMMATED, WHO OWNED THE 45 PERCENT
 
 3  SHARE OF THE FARREL ESTATE THAT WENT TO THE LEGION?
 
 4       A    AGAIN, THAT’s A LEGAL CONCLUSION.  I THINK IT
 
 5  WOULD BE VIBET.
 
 6       Q    BEFORE THE MONEY WAS TRANSFERRED BY FOETISCH TO
 
 7  VIBET, WHO OWNED THAT MONEY?
 
 8       MR. WAIER:  OBJECTION.  CALLS FOR LEGAL CONCLUSION.
 
 9  LACKS FOUNDATION.  HEARSAY.  SPECULATION.
 
10       THE COURT:  OVERRULED.
 
11       THE WITNESS:  MR. BEUGELMANS, I CAN'T ANSWER THAT
 
12  QUESTION BECAUSE I JUST DON'T KNOW, BECAUSE I BELIEVE IT
 
13  IS — HAS TO BE ANSWERED BY AN ATTORNEY WHO WAS INVOLVED.
 
14
 
15  BY MR. BEUGELMANS:
 
16       Q    SIR, IS THE MONEY THAT WAS DEPOSITED IN VIBET
 
17  ACCOUNTS YOUR MONEY?
 
18       A    NO.
 
19       Q    I WOULD LIKE TO READ FROM YOUR DEPOSITION, PAGE
 
20  116, LINE 19 THROUGH 21.
 
21            “QUESTION:  NOW, THE MONEY THAT WENT TO VIBET WAS
 
22  YOUR MONEY, CORRECT?
 
23            “ANSWER:  THAT’s CORRECT."
 
24       A    MR. BEUGELMANS --
 
25       Q    NO QUESTION PENDING, SIR.
 
26       MR. WAIER:  WHERE DID YOU READ THAT FROM?
 
27       MR. BEUGELMANS:  PAGE 116, LINES 19 THROUGH 21.
 
28       THE WITNESS:  I HAD CONTROL OVER IT, YES, SIR.
			
			

page  125
 
 
 
 1       MR. BEUGELMANS:  THERE’s NO QUESTION PENDING, SIR.
 
 2
 
 3  BY MR. BEUGELMANS:
 
 4       Q    ALL OF THE MONEY THAT WAS DEPOSITED IN THE VIBET
 
 5  ACCOUNTS CAME FROM THE FARREL ESTATE, CORRECT?
 
 6       A    NO.
 
 7       Q    I WOULD LIKE TO READ FROM YOUR DEPOSITION, PAGE
 
 8  117, STARTING LINE 3 THROUGH 7.
 
 9            “QUESTION:  HAS VIBET EVER RECEIVED MONIES FROM
 
10  ANY SOURCE OTHER THAN THE FUNDS WHICH WERE TRANSFERRED TO
 
11  VIBET FROM YOUR SHARE OF THE 45 PERCENT OF THE SETTLEMENT OF
 
12  THE FARREL ESTATE?
 
13            “ANSWER:  I DON'T THINK SO."
 
14       MR. BEUGELMANS:  YOUR HONOR, NO FURTHER QUESTIONS AT
 
15  THIS TIME.  RESERVE THE RIGHT TO ASK FURTHER QUESTIONS ON
 
16  MONDAY WHEN MR. LANE IS HERE.
 
17       THE COURT:  DID YOU WANT TO QUESTION THE WITNESS OR
 
18  WAIT UNTIL YOU PUT YOUR CASE ON?
 
19       MR. WAIER:  I WAS GOING TO CALL HIM BACK IN ANY EVENT.
 
20  I WOULD BE HAPPY TO ASK HIM SOME QUESTIONS NOW IF --
 
21       THE COURT:  IT’s UP TO YOU.  IT DOESN'T MATTER.  WE
 
22  STILL HAVE THE OTHER WITNESS HERE.
 
23       MR. BEUGELMANS:  HE’s BEEN WAITING ALL AFTERNOON.
 
24       THE COURT:  MARCELLUS.  IT’s YOUR OPTION, REALLY.
 
25       MR. WAIER:  YOUR HONOR, THEN I WILL RESERVE MY DIRECT
 
26  EXAMINATION OF MR. CARTO UNTIL WE PUT ON OUR CASE.
 
27       THE COURT:  HAVE A SEAT, AND THANK YOU.  IF YOU WOULD
 
28  LIKE TO HAVE A SEAT WITH COUNSEL THERE.
			
			

page  126
 
 
 
 1            CALL MR. MARCELLUS BACK.
 
 2
 
 3                        THOMAS MARCELLUS,
 
 4  CALLED AS A WITNESS ON BEHALF OF THE PLAINTIFF, HAVING BEEN
 
 5  PREVIOUSLY SWORN, TESTIFIED AS FOLLOWS:
 
 6                 DIRECT EXAMINATION (CONTINUED)
 
 7  BY MR. MUSSELMAN:
 
 8       Q    MR. MARCELLUS, THIS MORNING YOU WERE TESTIFYING
 
 9  CONCERNING AN AMOUNT OF MONEY THAT WENT FROM THE LEGION TO
 
10  THE FOUNDATION TO DEFEND THE FIRST AMENDMENT.  WE DIDN'T
 
11  DISCUSS THE AMOUNT, THE PRECISE AMOUNT OR THE MAGNITUDE
 
12  EITHER.  DO YOU KNOW HOW MUCH MONEY WENT FROM THE LEGION TO
 
13  THE FOUNDATION TO DEFEND THE FIRST AMENDMENT?
 
14       MR. WAIER:  OBJECTION.  LACKS FOUNDATION.  CALLS FOR
 
15  SPECULATION.  NOT THE BEST EVIDENCE.
 
16       THE COURT:  OVERRULED.
 
17       THE WITNESS:  YES, IT WAS APPROXIMATELY $90,000.
 
18
 
19  BY MR. MUSSELMAN:
 
20       Q    WHEN WAS THAT?
 
21       A    THAT WAS 1984 THROUGH 19 — IT WOULD BE 1985 AND
 
22  EARLY 1986, PERHAPS LATE 1984.
 
23       Q    PRIOR TO YOUR MEETING MISS JEAN FARREL IN 1984,
 
24  HAD YOU HAD ANY DEALINGS WITH HER?
 
25       A    YES.  WE HAD A VIGOROUS CORRESPONDENCE.
 
26       Q    HOW DID THAT GET STARTED?
 
27       A    IT GOT STARTED WHEN SHE WROTE TO THE LEGION, WROTE
 
28  TO THE I.H.R., THE LEGION.  I READ THE CORRESPONDENCE AND
			
			

page  127
 
 
 
 1  RETURNED IT, AND WE BEGAN A CORRESPONDENCE THAT WAY.
 
 2       Q    PRIOR TO HER MAKING ANY CONTRIBUTIONS TO THE
 
 3  LEGION, HAD THE LEGION RAISED MONEY FROM ANYBODY ELSE?
 
 4       A    OH, YES.
 
 5       Q    WHAT’s THE MOST AMOUNT OF MONEY RAISED FOR ONE
 
 6  PARTICULAR PURPOSE?
 
 7       A    120,000.
 
 8       Q    WHAT DID YOU RAISE THAT FOR?
 
 9       A    BUILDING FUND.
 
10       Q    YOU SAY “BUILDING FUND.”  WHAT DO YOU MEAN?
 
11       A    IN 1984, THE LEGION WAS BURNED DOWN AND THE
 
12  OFFICES WERE BURNED DOWN.  SO WE COMMENCED A BUILDING FUND
 
13  IN THEN, JULY 1984, TO RAISE FUNDS FOR A NEW BUILDING.
 
14       Q    HOW LONG A PERIOD DID IT TAKE TO RAISE THE FUNDS?
 
15       A    3 TO 4 MONTHS.
 
16       Q    AT THE END OF 1984, DID THE LEGION HAVE ANY CASH
 
17  OR OTHER ASSETS?
 
18       MR. WAIER:  OBJECTION.  LACKS FOUNDATION.  NOT THE BEST
 
19  EVIDENCE.  CALLS FOR SPECULATION.  HEARSAY.
 
20       THE COURT:  OVERRULED.
 
21       THE WITNESS:  YES, IT DID.
 
22
 
23  BY MR. MUSSELMAN:
 
24       Q    DO YOU KNOW WHAT APPROXIMATE AMOUNT IT HAD IN
 
25  ASSETS?
 
26       A    WITH INVENTORY AND CASH, I WOULD SAY IN THE
 
27  NEIGHBORHOOD OF 150,000.
 
28       Q    DOES THAT DOLLAR NUMBER INCLUDE THE FARREL ESTATE?
			
			

page  128
 
 
 
 1       A    NO.
 
 2       Q    AT THE END OF 1985, DID LEGION HAVE ANY ASSETS
 
 3  BESIDES THE FARREL LITIGATION OR THE FARREL ASSETS?
 
 4       A    YES.
 
 5       Q    YOU KNOW THE APPROXIMATE DOLLAR VALUE IT HAD IN
 
 6  ASSETS AT THAT TIME?
 
 7       MR. WAIER:  OBJECT.  LACKS FOUNDATION.  CALLS FOR
 
 8  SPECULATION.  HEARSAY.
 
 9       THE COURT:  OVERRULED.
 
10       THE WITNESS:  APPROXIMATELY 150,000 TO $200,000.
 
11
 
12  BY MR. MUSSELMAN:
 
13       Q    THE END OF 1987, DID THE LEGION HAVE ANY ASSETS
 
14  BESIDES THE FARREL ASSETS?
 
15       A    YES.
 
16       Q    DO YOU KNOW THE APPROXIMATE VALUE OF THE ASSETS IT
 
17  HELD THEN?
 
18       MR. WAIER:  OBJECTION.  LACKS FOUNDATION.  CALLS FOR
 
19  HEARSAY.  SPECULATION.
 
20       THE COURT:  OVERRULED.
 
21       MR. WAIER:  MAY I BE HEARD ON THAT?
 
22       THE COURT:  NO.
 
23       THE WITNESS:  AGAIN, IT WOULD BE BETWEEN 150,000 AND
 
24  $200,000.
 
25
 
26  BY MR. MUSSELMAN:
 
27       Q    HOW ABOUT THE END OF 1988?
 
28       A    SAME.
			
			

page  129
 
 
 
 1       Q    HOW ABOUT THE END OF 1989?
 
 2       MR. WAIER:  OBJECTION AGAIN.  HEARSAY.  LACKS
 
 3  FOUNDATION.  SPECULATION.
 
 4       THE COURT:  OVERRULED.
 
 5       THE WITNESS:  150,000.
 
 6
 
 7  BY MR. MUSSELMAN:
 
 8       Q    AND THE APPROXIMATE AMOUNT AT THE END OF 1990?
 
 9       A    JUST OVER 200,000 AT THAT TIME.
 
10       Q    HOW ABOUT THE END OF 1991?
 
11       A    200,000.
 
12       Q    HOW ABOUT THE END OF 1992?
 
13       A    200,000.
 
14       Q    DID MR. CARTO EVER REVEAL TO YOU THE VALUE OF
 
15  NECA’s ASSETS?
 
16       A    YES.
 
17       Q    WHEN WAS THAT?
 
18       A    FIRST IN 1985 AFTER JEAN FARREL’s DEATH AND THEN
 
19  ON SEVERAL OCCASIONS BETWEEN THEN AND 1993.
 
20       Q    DID HE EVER TELL YOU IT WAS NECESSARY TO GO BORROW
 
21  MONEY TO PROSECUTE THE FARREL LITIGATION?
 
22       A    NO, NOT THAT I RECALL.
 
23       Q    DID HE EVER TELL YOU IT WAS NECESSARY TO HAVE A
 
24  FUND-RAISING CAMPAIGN TO RAISE THE MONEY FOR THAT PURPOSE?
 
25       A    NO.
 
26       Q    LOOK AT EXHIBIT 9, PLEASE, THE DATE AT THE TOP OF
 
27  SEPTEMBER 7 — I'M SORRY.  MAYBE EXHIBIT 10, SEPTEMBER 7,
 
28  1985.
			
			

page  130
 
 
 
 1       A    I HAVE IT.
 
 2       Q    IS THAT EXHIBIT 10 IN YOUR BOOK?
 
 3       A    YES.  EXHIBIT 9, I BELIEVE, IN MY BOOK.
 
 4       Q    HAVE YOU EVER SEEN THAT BEFORE?
 
 5       A    YES.
 
 6       Q    WHEN WAS THAT?
 
 7       A    I SAW IT IN 1993.
 
 8       Q    DID YOU EVER SIGN SUCH A DOCUMENT OR ORIGINAL OF
 
 9  SUCH A DOCUMENT?
 
10       A    NO.
 
11       Q    WHAT WERE THE CIRCUMSTANCES OF YOU SEEING IT IN
 
12  1993?
 
13       A    IT WAS DOCUMENTS OBTAINED IN CONJUNCTION WITH THE
 
14  LEGION STAFF’s INVESTIGATION OF MR. Carto’s LEGAL STANDING
 
15  WITH THE CORPORATION.  MANY OF THESE DOCUMENTS CAME FROM THE
 
16  NORTH CAROLINA CASE.  I BELIEVE — THIS, I BELIEVE, COULD
 
17  HAVE BEEN AMONG THEM.  THAT IS THE MOST LIKELY SOURCE OF
 
18  IT.
 
19       MR. WAIER:  I AM GOING TO OBJECT.  MOVE TO STRIKE.
 
20  SPECULATION.
 
21       THE COURT:  OVERRULED.
 
22
 
23  BY MR. MUSSELMAN:
 
24       Q    WOULD YOU LOOK AT EXHIBIT 10, PLEASE.
 
25       A    MINUTES OF SEPTEMBER 19, '85?
 
26       Q    YES.  HAVE YOU SEEN THAT PARTICULAR SET OF MINUTES
 
27  BEFORE?
 
28       A    YES, I HAVE.
			
			

page  131
 
 
 
 1       Q    WHEN WAS THAT?
 
 2       A    IT WAS, AGAIN, I BELIEVE, 1993 OR COULD HAVE BEEN
 
 3  1994.
 
 4       Q    DID MR. CARTO TELL YOU THAT HE HAD BEEN EMPOWERED
 
 5  BY THE LEGION TO SECURE NECA FOR HIS OWN PERSONAL BENEFIT?
 
 6       A    NO.
 
 7       Q    DID HE EVER TELL YOU PRIOR TO 1993 THAT HE HAD
 
 8  BEEN EMPOWERED TO DISTRIBUTE THE MONEY TO WHOMEVER HE SAW
 
 9  FIT, THE FARREL MONIES?
 
10       A    PRIOR TO 1993?
 
11       Q    YES.
 
12       A    NOT PRIOR TO 1993, NO.
 
13       Q    DO YOU KNOW WHO HENRY FISCHER IS?
 
14       A    YES.
 
15       Q    WHO IS IT?
 
16       A    HENRY FISCHER IS A MAN WHOM CARTO, MR. CARTO, ON
 
17  SEVERAL OCCASIONS BROUGHT INTO THE OFFICES AND INTRODUCED
 
18  MR. FISCHER TO ME AS A FRIEND OF MR. Carto’s.  AND FIRST
 
19  TIME WAS — I MET MR. FISCHER WAS PROBABLY 1987.
 
20       Q    COULD YOU LOOK AT EXHIBIT 11, PLEASE, SAYS AT THE
 
21  TOP “SEPTEMBER 20, 1985 POWER OF ATTORNEY."
 
22       A    ALL RIGHT.
 
23       Q    HAVE YOU EVER SEEN THAT BEFORE?
 
24       A    I HAVE.
 
25       Q    WHEN WAS THAT?
 
26       A    AGAIN, 1993 WHEN I SAW MANY OF THESE KIND OF
 
27  DOCUMENTS.
 
28       Q    WILL YOU LOOK AT EXHIBIT 12, WHICH HAS THE SAME
			
			

page  132
 
 
 
 1  DATE.
 
 2       A    OKAY.
 
 3       Q    HAVE YOU EVER SEEN THAT?
 
 4       A    I DON'T RECALL SEEING THIS ONE SPECIFICALLY, NO.
 
 5       Q    LOOK AT EXHIBIT 15, PLEASE, ENTITLED “COMPLAINT."
 
 6       A    OKAY.
 
 7       Q    15, HAVE YOU SEEN THAT BEFORE?
 
 8       A    YES.
 
 9       Q    WHEN WAS THAT?
 
10       A    THIS WAS IN 1993 AFTER MR. CARTO HAD BEEN — HIS
 
11  RELATIONSHIP WITH THE LEGION HAD BEEN TERMINATED.
 
12       Q    PRIOR TO SEEING THAT IN THAT YEAR, HAD YOU EVER
 
13  DISCUSSED WITH HIM THE CONTENTS OF EXHIBIT 15?
 
14       A    I HAVE NO IDEA OF ANYTHING GOING ON IN NORTH
 
15  CAROLINA OR THIS CASE, SO THE ANSWER IS NO.
 
16       Q    COULD YOU LOOK AT EXHIBIT 21, PLEASE.  DOES YOUR
 
17  EXHIBIT HAVE A DATE OF MARCH 3RD, 1987, AT THE TOP?
 
18       A    IT DOES.
 
19       Q    HAVE YOU EVER SEEN THAT BEFORE?
 
20       A    LET ME BRIEFLY REVIEW.
 
21            YES, I HAVE SEEN THIS.
 
22       Q    WHEN WAS THAT?
 
23       A    THIS WAS — I'M NOT CLEAR ON THE YEAR, '83 OR
 
24  '84.  AND IT CAME TO THE LEGION FOLLOWING DEMAND FOR
 
25  PRODUCTION OF DOCUMENTS MADE ON MR. CARTO IN CONJUNCTION
 
26  WITH A LITIGATION.  THIS WAS, I BELIEVE, AMONG THE DOCUMENTS
 
27  HE PRODUCED.
 
28       Q    WHAT YEAR WAS THAT?
			
			

page  133
 
 
 
 1       A    '93 OR '94.
 
 2       Q    IN 1987, DID MR. CARTO DISCUSS WITH YOU THAT A
 
 3  SETTLEMENT WAS GOING TO BE REACHED SOON IN THE SWISS
 
 4  LITIGATION?
 
 5       A    NO, I DON'T BELIEVE THERE WAS A DISCUSSION WHERE
 
 6  HE SAID THAT.
 
 7       Q    DID HE TELL YOU THAT THE LEGION HAD BECOME HEAVILY
 
 8  INDEBTED BECAUSE OF THE LEGAL EXPENSES FROM THE LITIGATION?
 
 9       A    NO.
 
10       Q    LOOK AT EXHIBIT 23, PLEASE, DATED MARCH 1, 1988.
 
11  TELL ME WHETHER YOU HAVE SEEN THAT BEFORE.
 
12       A    MARCH 1, '88.  LET ME REVIEW IT A SECOND.
 
13            YES, I HAVE SEEN THIS.
 
14       Q    WHEN WAS THAT?
 
15       A    AGAIN, 1993, WHEN I SAW MANY OF THESE MINUTES.
 
16       Q    WHERE DID YOU SEE IT?
 
17       A    THE OFFICE OF THE LEGION.
 
18       Q    WOULD YOU LOOK AT EXHIBIT 27, PLEASE, DATED
 
19  MARCH 7, 1989.  TELL ME IF YOU HAVE SEEN THAT BEFORE.
 
20       A    YES, I HAVE SEEN THAT.
 
21       MR. WAIER:  WHAT EXHIBIT IS THAT AGAIN?
 
22       MR. MUSSELMAN:  27.
 
23
 
24  BY MR. MUSSELMAN:
 
25       Q    WHEN WAS THAT?
 
26       A    THIS WAS ANOTHER OF THOSE COPIES OF MINUTES THAT I
 
27  SAW IN '93 OR '94 AFTER MR. Carto’s RELATIONSHIP WITH THE
 
28  LEGION HAD BEEN TERMINATED.
			
			

page  134
 
 
 
 1       Q    LOOK AT EXHIBIT 25.  IT STATES THAT IT’s STATEMENT
 
 2  BY — STATEMENT BY STOCK CORPORATION.
 
 3       A    YES.
 
 4       Q    HAVE YOU SEEN THAT BEFORE?
 
 5       A    YES.
 
 6       Q    WHEN WAS THAT?
 
 7       A    OH, I SAW THIS, I BELIEVE, AT THE TIME — IT WAS
 
 8  AT OR ABOUT THE TIME IT WAS FILED.  IT WOULD HAVE BEEN --
 
 9  NOT SURE WHAT YEAR.  '88 OR '89, I SUPPOSE.
 
10       Q    WOULD YOU LOOK AT EXHIBIT 28, DATED MARCH 6,
 
11  1990.
 
12       A    I HAVE THAT.
 
13       Q    TELL ME IF YOU HAVE SEEN THAT BEFORE.
 
14       MR. WAIER:  28.  I DON'T HAVE THAT IN OUR EXHIBIT
 
15  BOOK.
 
16       MR. MUSSELMAN:  MARCH 6, 1990 MINUTES.  ONE IN EITHER
 
17  DIRECTION.
 
18       MR. WAIER:  NO, I DON'T HAVE IT AT ALL.
 
19       MR. BEUGELMANS:  MARCH 7 OR 6?
 
20       MR. MUSSELMAN:  MARCH 6, 1990.
 
21
 
22  BY MR. MUSSELMAN:
 
23       Q    TELL ME WHETHER YOU HAVE SEEN THAT.
 
24       A    I HAVE SEEN THIS ONE, YES.
 
25       Q    WHEN WAS THAT?
 
26       A    THIS WAS IN 1993.
 
27       Q    AGAIN, WHERE?
 
28       A    AT THE OFFICE OF THE LEGION.
			
			

page  135
 
 
 
 1       Q    LOOK AT EXHIBIT 29, THE SETTLEMENT AGREEMENT.
 
 2       A    I SEE IT.
 
 3       Q    HAVE YOU SEEN THAT BEFORE?
 
 4       A    YES, I HAVE.
 
 5       Q    WHEN WAS THE FIRST TIME YOU SAW IT?
 
 6       A    I BELIEVE IT WAS THE SUMMER OF 1993 AT THE LEGION
 
 7  OFFICES.
 
 8       Q    PRIOR TO SEEING IT, HAVE YOU HAD ANY DISCUSSION
 
 9  ABOUT IT WITH MR. CARTO?
 
10       A    NO, NOT ABOUT THE SETTLEMENT AGREEMENT, NO.
 
11       Q    COULD YOU LOOK AT EXHIBIT 30 AND TELL ME, HAVE YOU
 
12  SEEN THAT?
 
13       A    YES, I HAVE SEEN THIS.
 
14       Q    WHEN WAS THAT?
 
15       A    1993.
 
16       Q    PRIOR TO SEEING IT IN 1993, HAD YOU HAD ANY
 
17  DISCUSSIONS ABOUT IT WITH MR. CARTO?
 
18       A    NO.
 
19       Q    LOOK AT EXHIBIT 20, DISTRIBUTION AGREEMENT.
 
20       A    20?
 
21       Q    YES.
 
22       A    YES, I HAVE SEEN THIS.
 
23       Q    WHEN WAS THAT?
 
24       A    1993.
 
25       Q    PRIOR TO SEEING IT IN 1993, DID YOU HAVE ANY
 
26  DISCUSSIONS ABOUT IT WITH MR. CARTO?
 
27       A    NO.
 
28       Q    PRIOR TO 1993, DID MR. CARTO EVER GIVE YOU AN
			
			

page  136
 
 
 
 1  ACCOUNTING OF THE MONIES THAT WERE GENERATED BY THE
 
 2  SETTLEMENT OF THE FARREL LITIGATION?
 
 3       MR. WAIER:  OBJECTION.  RELEVANCY.
 
 4       THE COURT:  OVERRULED.
 
 5       THE WITNESS:  A VERBAL ACCOUNTING, YES, A ROUGH VERBAL
 
 6  ACCOUNTING.
 
 7
 
 8  BY MR. MUSSELMAN:
 
 9       Q    DID HE PROVIDE TO YOU ANY DOCUMENTATION TO
 
10  DEMONSTRATE WHICH ATTORNEYS HAD BEEN PAID?
 
11       A    NO.
 
12       Q    TO THIS DAY, DO YOU KNOW HOW MUCH THE TOTAL SUM OF
 
13  ATTORNEYS FEES WERE FOR THE LITIGATION?
 
14       A    I DO NOT.
 
15       Q    DID HE PROVIDE YOU ANY DOCUMENT DEMONSTRATING HOW
 
16  MUCH TAXES HAD BEEN PAID?
 
17       A    NO.
 
18       Q    TO THIS DATE, DO YOU KNOW HOW MUCH TAXES WERE PAID
 
19  AS A RESULT OF THE LITIGATION IN EUROPE?
 
20       A    NO.
 
21       Q    WILL YOU LOOK AT EXHIBIT 31.  TELL ME IF YOU HAVE
 
22  SEEN THAT BEFORE, A RIDER TO THE DISTRIBUTION AGREEMENT.
 
23       A    YES, I HAVE SEEN THIS.
 
24       Q    WHEN WAS THAT?
 
25       A    THAT WAS — WOULD BE THE SAME TIME, IN SUMMER,
 
26  FALL, 1993.
 
27       Q    PRIOR TO THAT, DID YOU HAVE ANY DISCUSSIONS ABOUT
 
28  IT WITH MR. CARTO?
			
			

page  137
 
 
 
 1       A    NO.
 
 2       Q    MR. CARTO EVER SHOW YOU ANY SIGNATURE CARDS
 
 3  DEMONSTRATING WHO HAD SIGNATORY POWERS OVER ANY ACCOUNT AT
 
 4  BANQUE CANTRADE LAUSANNE?
 
 5       A    NO.
 
 6       Q    HAS HE SHOWED YOU ANY BANK STATEMENTS FROM SUCH
 
 7  ACCOUNT?
 
 8       A    NO.
 
 9       Q    HAS HE EVER SHOWN YOU ANY BOARD OF DIRECTORS'
 
10  RESOLUTIONS AUTHORIZING THE OPENING OF SUCH ACCOUNT?
 
11       A    NO.
 
12       Q    HAS MR. CARTO EVER TOLD YOU WHETHER MR. FISCHER
 
13  WAS PAID IN CONNECTION WITH MR. FISCHER’s EFFORTS IN THE
 
14  FARREL LITIGATION?
 
15       A    NO.
 
16       Q    COULD YOU LOOK AT EXHIBIT 35, PLEASE, JANUARY 9,
 
17  1991.
 
18       A    OKAY.
 
19       Q    HAVE YOU SEEN THAT BEFORE?
 
20       A    I DON'T BELIEVE SO.
 
21       Q    DID HE TELL YOU IN JANUARY — DID MR. CARTO TELL
 
22  YOU IN JANUARY 1991 THAT THE LEGION WOULD SOON BE ABLE TO
 
23  PAY ITS MANY DEBTS THAT HAD BEEN INCURRED OVER THE LAST 5
 
24  YEARS FOR ATTORNEYS IN CONNECTION WITH THE FARREL
 
25  LITIGATION?
 
26       A    NOT FOR ATTORNEYS, NO.
 
27       Q    COULD YOU LOOK AT EXHIBIT 36, WHICH IS ENTITLED
 
28  “POWER OF ATTORNEY.”  TELL ME IF YOU HAVE SEEN THAT
			
			

page  138
 
 
 
 1  BEFORE.
 
 2       A    YES.
 
 3       Q    WHEN WAS THAT?
 
 4       A    1993.
 
 5       Q    WHERE WAS THAT?
 
 6       A    IN THE LEGION OFFICES.
 
 7       Q    PRIOR TO 1993, DID MR. CARTO EVER DISCUSS WITH YOU
 
 8  THIS DOCUMENT?
 
 9       A    NO.
 
10       Q    LOOK AT EXHIBIT 37, PLEASE, WHICH STATES “POWER OF
 
11  ATTORNEY” AT THE TOP, MAKES REFERENCE TO HENRY FISCHER.
 
12       A    OKAY.
 
13       Q    HAVE YOU SEEN THAT BEFORE?
 
14       A    YES.
 
15       Q    WHEN WAS THAT?
 
16       A    AGAIN, I SAW THIS IN 1993.
 
17       Q    IN 1991, DID MR. CARTO TELL YOU MR. FISCHER HAD
 
18  BEEN GIVEN A POWER OF ATTORNEY TO SECURE THE FARREL ESTATE
 
19  ASSETS OR NECA FOR THE LEGION?
 
20       A    I'M SORRY, I DIDN'T UNDERSTAND THE FIRST PART OF
 
21  THAT QUESTION.
 
22       Q    IN 1991, DID MR. CARTO DISCUSS WITH YOU THAT
 
23  MR. FISCHER HAD BEEN GRANTED A POWER OF ATTORNEY TO HELP
 
24  SECURE THE FARREL ASSETS FOR THE LEGION?
 
25       A    NO.
 
26       Q    LOOK AT EXHIBIT 38, PLEASE, A LETTER DATED 15
 
27  FEBRUARY 1991.  TELL ME IF YOU HAVE SEEN THAT BEFORE.
 
28       A    YES, I HAVE.
			
			

page  139
 
 
 
 1       Q    WHEN WAS THE FIRST TIME?
 
 2       A    I BELIEVE IT WAS IN LATE 1993 AFTER WE HAD
 
 3  SECURED — OBTAINED SOME OF THE DOCUMENTS FROM VIBET AND
 
 4  COMPANY.  THIS WAS MONEY — THEN THAT’s WHEN I SAW IT.
 
 5       Q    LOOK AT EXHIBIT 39, DATED 21ST FEBRUARY 1991.
 
 6  TELL ME WHEN — IF YOU HAVE EVER SEEN THAT.
 
 7       A    I DON'T BELIEVE I HAVE EVER SEEN THIS DOCUMENT.
 
 8       Q    COULD YOU LOOK AT EXHIBIT 40, DATED 22ND FEBRUARY
 
 9  1991.  LET ME KNOW IF YOU HAVE SEEN THAT BEFORE.
 
10       A    I DON'T BELIEVE I HAVE.
 
11       Q    LOOK AT EXHIBIT 41.  PLEASE TELL ME IF YOU HAVE
 
12  SEEN IT BEFORE.
 
13       A    YES, I HAVE.
 
14       Q    WHEN WAS THAT?  WHEN WAS THE FIRST TIME?
 
15       A    1993.
 
16       Q    PRIOR TO 1993, DID MR. CARTO EVER TELL YOU THAT
 
17  THE LEGION HAD DECIDED NOT TO ACCEPT THE FARREL ASSETS?
 
18       A    NO.
 
19       Q    LOOK AT EXHIBIT 45, PLEASE, A LETTER DATED
 
20  MARCH 23, 1991.
 
21       A    I HAVE IT.
 
22       Q    HAVE YOU EVER SEEN THAT BEFORE?
 
23       A    YES, I HAVE.
 
24       Q    WHEN WAS THE FIRST TIME?
 
25       A    JULY OF '93.
 
26       Q    PRIOR TO 1993, DID YOU EVER DISCUSS WITH MR. CARTO
 
27  THAT THE LEGION HAD ESTABLISHED AN ENTITY CALLED THE
 
28  INTERNATIONAL LEGION FOR THE SURVIVAL OF THE FREEDOM TRUST?
			
			

page  140
 
 
 
 1       A    NO, I WASN'T AWARE OF SUCH AN ENTITY.
 
 2       Q    LOOK AT EXHIBIT 46, PLEASE, DATED 5 JUNE 1991.
 
 3       A    OKAY.
 
 4       Q    HAVE YOU SEEN THAT BEFORE?
 
 5       A    YES.
 
 6       Q    WHEN WAS THE FIRST TIME?
 
 7       A    1993, 1994.
 
 8       Q    COULD YOU LOOK AT EXHIBIT 48, PLEASE, DATED
 
 9  MARCH 10, 1992.
 
10       A    OKAY.  LET ME LOOK AT IT A SECOND.
 
11            OH, YES, I REMEMBER THIS ONE WELL.
 
12       Q    HAVE YOU SEEN IT BEFORE?
 
13       A    YES.
 
14       Q    WHEN WAS THE FIRST TIME?
 
15       A    I SAW IT IN — IT WAS 1993, 1994 IN CONNECTION
 
16  WITH THE PRODUCTION OF DOCUMENTS DEMANDED OF MR. CARTO IN
 
17  SOME LITIGATION.  THIS WAS AMONG THE DOCUMENTS.
 
18       Q    THERE’s A REFERENCE TO YOUR NAME --
 
19       A    YES.
 
20       Q    — HAVING BEEN PRESENT AT THE MEETINGS THAT'S
 
21  RECITED BY THE DOCUMENT.  WERE YOU PRESENT AT SUCH A
 
22  MEETING?
 
23       A    I WAS NOT.
 
24       Q    HAS ANYONE ASKED YOU TO APPROVE LEGION BOARD
 
25  MINUTE MEETINGS OF MARCH 3, 1991?
 
26       A    NO.
 
27       Q    HAS ANYONE ASKED YOU TO APPROVE THESE MINUTES?
 
28       A    NO.
			
			

page  141
 
 
 
 1       Q    LOOK AT EXHIBIT 49, PLEASE, DATED DECEMBER 9,
 
 2  1992.  LET ME KNOW IF YOU HAVE SEEN THAT BEFORE.
 
 3       A    YES.
 
 4       Q    WHEN WAS THE FIRST TIME?
 
 5       A    AGAIN, THIS WAS AMONG THE DOCUMENTS THAT WERE
 
 6  OBTAINED, I BELIEVE, IN THE DEMAND FOR PRODUCTION OF
 
 7  DOCUMENTS.  I SAW IT FIRST, I THINK, IN 1993 OR EARLY 1994
 
 8  AT THE LEGION OFFICES.
 
 9       Q    LOOK AT EXHIBIT 51, PLEASE, DATED MARCH 2ND,
 
10  1993.  TELL ME WHETHER YOU HAVE SEEN THAT BEFORE.
 
11       A    I DON'T RECALL SEEING THIS DOCUMENT BEFORE.
 
12       Q    DID MR. CARTO EVER TELL YOU THAT THE FARREL ASSETS
 
13  FOR — THE PROCEEDS OF THE FARREL ASSETS WERE BEING
 
14  TRANSFERRED TO GOOD CAUSES?
 
15       A    YES.
 
16       Q    WHEN WAS THAT?
 
17       A    THAT WOULD BE ON OR ABOUT JULY OF 1993.
 
18       Q    DID HE SHOW YOU DOCUMENTS DEMONSTRATING THAT TO BE
 
19  THE CASE?
 
20       A    NO.
 
21       Q    DID YOU HAVE ANY DISCUSSIONS WITH LAVONNE FURR ON
 
22  THAT SUBJECT AFTER HE TALKED TO YOU ABOUT IT?
 
23       A    SUBSEQUENT TO THAT, YES, I DID.
 
24       Q    WHEN WAS THAT?
 
25       A    THAT WOULD HAVE BEEN DURING THE PERIOD, I WOULD
 
26  SAY, FROM JULY TO SEPTEMBER 1993.
 
27       Q    COULD YOU LOOK AT EXHIBIT 52, PLEASE, STATES “MEMO
 
28  TO FILE."
			
			

page  142
 
 
 
 1       MR. WAIER:  WHAT?
 
 2       MR. MUSSELMAN:  52.
 
 3       THE WITNESS:  I HAVE IT.
 
 4
 
 5  BY MR. MUSSELMAN:
 
 6       Q    HAVE YOU SEEN THAT BEFORE?
 
 7       A    YES, I HAVE.
 
 8       Q    WHEN DID YOU FIRST SEE IT?
 
 9       A    I WROTE IT.
 
10       Q    WHEN DID YOU WRITE IT?
 
11       A    I WROTE IT ON JUNE 18, 1993.  THAT’s MY
 
12  HANDWRITING ON THE TOP NOTING THE DATE.
 
13       Q    DID YOU SPEAK TO LAVONNE FURR ON THAT DAY?
 
14       A    YES.
 
15       Q    DOES THE CONTENTS OF EXHIBIT 52 REPEAT THE
 
16  CONVERSATION?
 
17       A    YES.
 
18       Q    WERE YOU RECORDING IT DURING THE CONVERSATION?
 
19       A    THE ANSWER TO THAT IS NO.
 
20       Q    DID YOU PREPARE IT SOON THEREAFTER?
 
21       A    YES.
 
22       Q    WHAT DID YOU DO WITH THE MEMO AFTER YOU PREPARED
 
23  IT?
 
24       A    I GAVE COPIES TO THE OTHER STAFF MEMBERS WHO WERE
 
25  INVOLVED IN THIS INVESTIGATION OF MR. Carto’s LEGAL STANDING
 
26  WITH THE CORPORATION.
 
27       Q    LOOK AT EXHIBIT 53, PLEASE, A LETTER DATED
 
28  JUNE 22ND, 1993.
			
			

page  143
 
 
 
 1       A    I HAVE IT.
 
 2       Q    HAVE YOU SEEN THAT BEFORE?
 
 3       A    YES.
 
 4       Q    WHEN DID YOU FIRST SEE IT?
 
 5       A    I WROTE THIS LETTER ON JUNE 22ND, 1993.
 
 6       Q    DID YOU SEND IT?
 
 7       A    YES.
 
 8       Q    WHY DID YOU WRITE THE LETTER?
 
 9       A    LET ME REVIEW IT QUICKLY.
 
10       MR. WAIER:  I AM GOING TO OBJECT TO RELEVANCY.
 
11       THE COURT:  OVERRULED.
 
12       THE WITNESS:  THERE WERE 2 REASONS FOR WRITING THIS
 
13  LETTER TO LAVONNE FURR, 2 DISTINCT AND SEPARATE REASONS.
 
14
 
15  BY MR. MUSSELMAN:
 
16       Q    WHAT WERE THEY?
 
17       A    ONE WAS MR. CARTO HAD — HAD PROMPTED THE LEGION
 
18  TO PUBLISH A BOOK, AGAINST THE RECOMMENDATIONS OF THE
 
19  STAFF.  AND THE LEGION WAS SUBSEQUENTLY SUED BY THE AUTHOR
 
20  OF THAT BOOK OR AT LEAST THE PERSON WHO CLAIMED TO BE THE
 
21  AUTHOR OF THAT BOOK.  AND THE LEGION WAS INVOLVED IN
 
22  LITIGATION, AND I WAS PERSONALLY NAMED IN THE SUIT.  AND SO
 
23  I ASKED MR. CARTO TO SIGN AN AGREEMENT INDEMNIFYING ME IN
 
24  THE LAWSUIT.  IN OTHER WORDS, IF A JUDGMENT WAS RENDERED
 
25  AGAINST ME PERSONALLY, THE LEGION WOULD PAY IT.
 
26            AFTER HE SIGNED THAT AGREEMENT, I THEN SPOKE WITH
 
27  MRS. FURR BECAUSE I WAS QUITE WORRIED ABOUT THIS AND ASKED
 
28  HER IF THAT SIGNATURE OF WILLIS ON THAT INDEMNITY AGREEMENT
			
			

page  144
 
 
 
 1  WAS LAWFUL OR VALID.  AND SHE SAID NO, TO SEND THE INDEMNITY
 
 2  AGREEMENT TO HER AND SHE WOULD SIGN IT.  THAT WAS THE FIRST
 
 3  REASON.
 
 4       Q    WHAT WAS THE SECOND REASON?
 
 5       A    THE SECOND REASON WAS AT THIS TIME, WE WERE
 
 6  PERFORMING THIS INVESTIGATION TO DETERMINE MR. Carto’s LEGAL
 
 7  STANDING WITH THE CORPORATION.
 
 8       Q    WHEN YOU SAY “WE,” WHO IS “WE"?
 
 9       A    TED O’Keefe, GREG RAVEN, MARK WEBER AND MYSELF.
 
10       Q    WHO ARE THOSE PERSONS OTHER THAN YOURSELF?
 
11       A    TED O’Keefe, AT THE TIME, WAS AN EDITOR EMPLOYED
 
12  BY THE LEGION.  MARK WEBER WAS AN EDITOR AND STILL IS
 
13  EMPLOYED BY THE LEGION.  AND GREG RAVEN, AT THAT TIME, WAS
 
14  ASSISTANT EDITOR, IS STILL EMPLOYED BY THE LEGION.
 
15       Q    OTHER THAN THESE PEOPLE, WERE THERE ANY — WAS
 
16  THERE ANYONE OTHER THAN CLERICAL STAFF?
 
17       A    I BELIEVE JUST THE FOUR OF US OUTSIDE OF THE
 
18  CLERICAL STAFF.
 
19       Q    I'M SORRY, I INTERRUPTED YOU WHEN YOU WERE
 
20  DESCRIBING THE SECOND PURPOSE OF THE LETTER.
 
21       A    THE REASON I WROTE THIS, THE SECOND REASON WAS
 
22  BECAUSE FOR SOME REASON IN — DURING THE EARLY SUMMER, THE
 
23  LATE SPRING, EARLY SUMMER OF 1993, MR. CARTO GOT WHAT WE
 
24  CALL A BEE IN HIS BONNET.  HE WAS VERY ANXIOUS TO — TO
 
25  OVERHAUL THE WHOLE EDITORIAL DIRECTION OF THE INSTITUTE AND
 
26  THE JOURNAL.  THERE WERE THREATS MADE THAT MR. WEBER WAS
 
27  GOING TO BE REMOVED AS EDITOR.  THERE WAS A DISCUSSION WITH
 
28  MR. CARTO.  HE SAID SPECIFICALLY HE WAS GOING TO TRY TO
			
			

page  145
 
 
 
 1  REPLACE MR. WEBER.  HE WOULD NOT TELL ME — MR. CARTO WOULD
 
 2  NOT TELL ME THE REASON WHY HE WAS CAUSING ENORMOUS UPSET.
 
 3  THE WHOLE ORGANIZATION WAS UPSET.  WE WERE ALL PREPARING TO
 
 4  LEAVE THE ORGANIZATION IF MR. CARTO FIRED MR. WEBER.
 
 5       MR. WAIER:  OBJECTION.  MOVE TO STRIKE.  CALLING FOR
 
 6  HEARSAY.  NONRESPONSIVE.
 
 7       THE COURT:  OVERRULED.
 
 8       THE WITNESS:  I WAS VERY INTERESTED AT THAT POINT IN
 
 9  TIME TO FIND OUT EXACTLY WHAT AUTHORITY MR. CARTO HAD TO
 
10  CHANGE THE EDITORIAL DIRECTION OF THE ORGANIZATION AND
 
11  TO — TO FIRE PEOPLE.  I WAS THE DIRECTOR; I HAD TO KNOW
 
12  THIS.  I HAD TO FIND OUT IF HE HAD CORPORATE STANDING TO DO
 
13  THESE KIND OF THINGS.  I WAS ALSO APPEALING TO MRS. FURR TO
 
14  TAKE A LITTLE CLOSER LOOK AT WHAT IS GOING ON WITH THE
 
15  ORGANIZATION.  I WAS POINTING OUT TO HER THAT MR. CARTO HAD
 
16  DIRECTED ME TO REPRINT A COUPLE OF BOOKS THAT WE HAD BEEN
 
17  SUED ON — WE HAD THREATENED TO BE SUED ON BY THE COPYRIGHT
 
18  OWNERS, AND I WANTED HER HELP AND ADVICE.
 
19
 
20  BY MR. MUSSELMAN:
 
21       Q    THE BOTTOM OF EXHIBIT 53, THE SECOND TO THE LAST
 
22  PARAGRAPH, PART OF THE SENTENCE SAYS “I NEED TO KNOW WHERE
 
23  WILLIS STANDS."
 
24            DO YOU HAVE ANY RECOLLECTION WHAT YOU INTENDED BY
 
25  THAT PHRASE WHEN YOU USED IT?
 
26       A    YES.
 
27       Q    WHAT IS IT?
 
28       A    I INTENDED TO GET AN ANSWER FROM LAVONNE AS TO
			
			

page  146
 
 
 
 1  WHAT MR. Carto’s LEGAL STANDING WAS WITH THE CORPORATION,
 
 2  WHAT SHE — WHAT THE CORPORATION ACTUALLY AUTHORIZED HIM TO
 
 3  DO.
 
 4       Q    LOOK AT EXHIBIT 54, PLEASE, DATED JULY 13, 1993.
 
 5       A    YES.
 
 6       Q    TELL ME IF YOU HAVE SEEN THAT BEFORE.
 
 7       A    YES, I WROTE THIS.
 
 8       Q    WHEN DID YOU WRITE IT?
 
 9       A    JULY 13, 1993.
 
10       Q    THERE’s A REFERENCE IN THE FIRST SENTENCE TO
 
11  ELISABETH.  WHO IS THAT?
 
12       A    ELISABETH CARTO, MR. Carto’s WIFE.
 
13       Q    DID YOU HAVE ANY CONVERSATIONS WITH HER ON JULY
 
14  13, 1993?
 
15       A    YES.
 
16       Q    DOES THIS MEMO REPEAT THE CONVERSATIONS?
 
17       A    LET ME REFRESH MY MEMORY.
 
18            YES.
 
19       Q    AND THE FOURTH PARAGRAPH, AS OF OCTOBER 1992, THAT
 
20  SENTENCE, IS THAT SOMETHING SHE TOLD YOU OR YOU TOLD HER?
 
21       A    THIS IS WHAT SHE TOLD ME.
 
22       Q    DID SHE USE THE EXACT WORDS, “AS OF OCTOBER 1992,
 
23  LIBERTY LIFE LINE 158,000"?
 
24       A    NO.  THAT’s MY PARAPHRASING WHAT SHE SAID TO ME.
 
25       Q    DID SHE USE THE EXACT WORDS, “LEGION OWED F.D.F.A.
 
26  $30,000"?
 
27       A    I'M SORRY, I DON'T RECALL IF SHE USED THOSE EXACT
 
28  WORDS.
			
			

page  147
 
 
 
 1       Q    OR “THE LEGION OWED HISTORICAL EDUCATION
 
 2  FOUNDATION $58,000"?
 
 3       A    NO.  I BELIEVE THIS WAS ALL IN THE CONTEXT OF HER
 
 4  NARRATING TO ME WHAT SHE WANTED ME TO BELIEVE THE LEGION
 
 5  OWED, AND I WAS SIMPLY REPEATING IT HERE.
 
 6       Q    DID SHE TELL YOU THAT THE LEGION OWED VIBET
 
 7  $250,000?
 
 8       A    IN SO MANY WORDS, YES.
 
 9       Q    DID SHE TELL YOU WHY THERE WAS THAT DEBT?
 
10       A    YES.  SHE HAD EXPLAINED TO ME, EITHER ON THAT
 
11  OCCASION OR EARLIER, WHAT THE NATURE OF THIS, QUOTE,
 
12  UNQUOTE, “DEBT” WAS.
 
13       Q    DID SHE TELL YOU THE LEGION HAD IN FACT BORROWED
 
14  FUNDS OWNED BY VIBET?
 
15       A    YES.
 
16       Q    DID SHE SAY WHERE THE MONEY CAME FROM?
 
17       A    YES.
 
18       Q    WHERE WAS THAT?
 
19       A    IT CAME FROM THE FARREL GIFT TO THE LEGION.
 
20       Q    DID SHE TELL YOU WHY THE MONEY WAS BEING LOANED BY
 
21  VIBET TO THE LEGION?
 
22       A    YES.
 
23       Q    WHY WAS THAT?
 
24       A    SHE CLAIMED THAT THE REASON THE MONEY WAS BEING
 
25  LOANED TO THE LEGION WAS TO MAKE IT APPEAR — TO APPEAR AS
 
26  A DEBT ON LEGION’s BOOKS IN ORDER TO, I SUPPOSE, PROTECT THE
 
27  LEGION AGAINST ANY CREDITORS THAT MIGHT ARISE OUT OF AN
 
28  ADVERSE LITIGATION OR ADVERSE JUDGMENT IN THE LITIGATION, TO
			
			

page  148
 
 
 
 1  MAKE THE LEGION APPEAR BANKRUPT OR NEARLY BANKRUPT.
 
 2       Q    LOOK AT EXHIBIT 57, PLEASE, THE DATE OF 17 AUGUST
 
 3  1993.
 
 4       A    I SEE IT.
 
 5       THE CLERK:  I MISSED THAT EXHIBIT NUMBER.
 
 6
 
 7  BY MR. MUSSELMAN:
 
 8       Q    57.  HAVE YOU SEEN THAT BEFORE?
 
 9       A    YES.
 
10       Q    WHEN WAS THE FIRST TIME?
 
11       A    IT WAS AROUND THE DATE THAT’s ON IT, AUGUST 1993.
 
12       Q    WHERE WERE YOU?
 
13       A    AT THE LEGION OFFICES.
 
14       Q    DID YOU HAVE ANY DISCUSSIONS WITH MR. CARTO ABOUT
 
15  IT?
 
16       A    NO.
 
17       Q    EXHIBIT 55, PLEASE.  IT DOESN'T HAVE A DATE,
 
18  STARTS OUT SAYING “MEMO OF TOM MARCELLUS, TELEPHONE
 
19  CONVERSATION WITH LAVONNE FURR."
 
20       A    I HAVE IT.
 
21       Q    HAVE YOU SEEN THAT BEFORE?
 
22       A    YES.
 
23       MR. WAIER:  I'M SORRY, WHAT EXHIBIT?
 
24
 
25  BY MR. MUSSELMAN:
 
26       Q    55.  DID YOU COMPOSE THIS?
 
27       A    I DID.
 
28       Q    WHEN WAS THAT?
			
			

page  149
 
 
 
 1       A    IT WOULD HAVE BEEN ON AUGUST 21 OR ON THE
 
 2  FOLLOWING DAY.
 
 3       Q    DID YOU HAVE A CONVERSATION WITH LAVONNE FURR ON
 
 4  AUGUST 21, 1993?
 
 5       A    I DID.
 
 6       Q    DID SHE TELL YOU SHE AND HER HUSBAND HAD RECENTLY
 
 7  FILED FOR BANKRUPTCY?
 
 8       A    YES.
 
 9       Q    DID SHE TELL YOU THAT SHE GOT $900, WHICH ENABLED
 
10  HER TO FILE BANKRUPTCY?
 
11       A    YES.
 
12       Q    DID SHE TELL YOU WHERE THE MONEY CAME FROM?
 
13       A    I DON'T BELIEVE SO.  I SPECULATED ON IT HERE, BUT
 
14  I DON'T THINK SHE TOLD ME.
 
15       Q    DID SHE TELL YOU THAT SHE HAD NO INKLING OF HOW
 
16  MUCH MONEY THE LEGION FINALLY RECEIVED IN EUROPE?
 
17       A    I'M SORRY, FINISH THE QUESTION.
 
18       Q    THAT’s IT.
 
19       A    SHE DID TELL ME.
 
20       MR. WAIER:  OBJECT.  LEADING.
 
21       THE COURT:  WELL, IT IS, BUT IT’s THE ONLY WAY TO GET
 
22  TO IT.  OVERRULED.
 
23       THE WITNESS:  IT’s IN THE TEXT.
 
24
 
25  BY MR. MUSSELMAN:
 
26       Q    DID SHE TELL YOU SHE HAD NO INKLING WHERE THE
 
27  MONEY IS OR HOW IT WAS BEING DISBURSED?
 
28       A    THAT’s CORRECT.
			
			

page  150
 
 
 
 1       Q    WHAT DID SHE TELL YOU ABOUT WHETHER OR NOT WILLIS
 
 2  CARTO COULD SPREAD THE MONEY AROUND TO GOOD CAUSES?
 
 3       A    SHE SAID — AND I QUOTED HER BECAUSE IT WAS SO
 
 4  MEMORABLE.  SHE SAID, “HE CAN'T DO THAT.  IT’s NOT HIS
 
 5  MONEY."
 
 6       Q    DID SHE OFFER ANY EXPLANATION ABOUT WILLIS'S
 
 7  BEHAVIOR TO YOU?
 
 8       A    SHE INDICATED TO ME, TO MY SURPRISE, THAT SHE
 
 9  THOUGHT IT MIGHT BE DUE TO WHAT SHE BELIEVE TO HAVE BEEN
 
10  SOME HEAVY FINANCIAL LOSSES THAT MR. CARTO HAD EXPERIENCED
 
11  AT LIBERTY LOBBY.
 
12       Q    DID YOU HAVE ANY DISCUSSION WITH HER ABOUT WHAT
 
13  MR. Carto’s POWER WAS AT THE LEGION?
 
14       A    SHE SAID SHE DIDN'T THINK HE HAD SUCH POWER.
 
15       Q    DID YOU INFORM HER YOU HAD CONSULTED WITH AN
 
16  ATTORNEY?
 
17       A    YES, I SEE THAT I DID MAKE A NOTE OF THAT HERE,
 
18  YES.  SO I DID TELL HER THAT.
 
19       Q    DID YOU TELL HER WHAT THE ATTORNEY HAD TOLD YOU
 
20  ABOUT WHAT A BOARD OF A NONPROFIT CORPORATION COULD DO IN
 
21  REFERENCE TO APPOINTING AGENTS?
 
22       A    YES.
 
23       Q    WHAT DID YOU TELL HER?
 
24       A    I TOLD HER A NONPROFIT CORPORATION CANNOT APPOINT
 
25  AN AGENT TO RUN THE CORPORATION.  THAT’s WHAT WE WERE TOLD
 
26  BY THE ATTORNEY.
 
27       MR. WAIER:  I AM GOING TO OBJECT.  MOVE TO STRIKE THE
 
28  LAST PHRASE, WHAT ATTORNEY SAYS, AS BEING HEARSAY.
			
			

page  151
 
 
 
 1       THE COURT:  SUSTAIN THE OBJECTION.
 
 2
 
 3  BY MR. BEUGELMANS:
 
 4       Q    LOOK AT EXHIBIT 56, PLEASE, DATED AUGUST 26,
 
 5  1993.
 
 6       A    I SEE IT.
 
 7       Q    HAVE YOU SEEN THAT BEFORE?
 
 8       A    YES.
 
 9       Q    WHEN DID YOU SEE IT FIRST?
 
10       A    I WROTE IT ON AUGUST 26, 1993.
 
11       Q    WHAT CAUSED YOU TO WRITE IT?
 
12       A    IT WAS A DISCUSSION WITH ELISABETH CARTO.
 
13       Q    ABOUT WHAT?
 
14       A    ABOUT THE FARREL ESTATE GIFT AND THE PROCEEDS AND
 
15  WHAT HAPPENED TO THEM.
 
16       Q    DID SHE TELL YOU HOW MUCH OF THE FARREL ESTATE
 
17  PROCEEDS WAS GENERATED FOR THE LEGION?
 
18       A    YES.
 
19       Q    WHAT DID SHE SAY?
 
20       A    SHE SAID APPROXIMATELY 4 MILLION — I'M SORRY,
 
21  YEAH, ORIGINALLY WORTH APPROXIMATELY 15 MILLION.  AND
 
22  APPROXIMATELY 4 MILLION, SHE SAID, WAS TO GO TO THE LEGION.
 
23  THEN THERE WAS AN AFTER-TAX — SHE SAID SOMETHING, 2.75
 
24  MILLION AFTER TAX.  THAT’s WHAT SHE TOLD ME.
 
25       Q    DID SHE TELL YOU THERE WERE FUNDS THAT STILL
 
26  COULDN'T BE RELEASED TO THE LEGION?
 
27       A    YES.
 
28       Q    DID SHE TELL YOU WHO HAD THE FUNDS?
			
			

page  152
 
 
 
 1       A    YES.  SHE --
 
 2       Q    WHO?
 
 3       A    SHE MENTIONED THE NAME ROCHAT, WHICH IS “ROCHAT,"
 
 4  BUT I DIDN'T HEAR IT RIGHT.  SO I THOUGHT I HEARD “ROSHAD."
 
 5       Q    COULD YOU TURN TO EXHIBIT 58, PLEASE.
 
 6            HAVE YOU SEEN THAT BEFORE?
 
 7       A    YES.
 
 8       Q    DID YOU WRITE IT?
 
 9       A    YES.
 
10       Q    DID YOU HAVE A CONVERSATION WITH LAVONNE FURR ON
 
11  AUGUST 27, 1993?
 
12       A    I DID.
 
13       Q    DID YOU HAVE ANY DISCUSSION WITH HER ABOUT HER AND
 
14  MR. FURR ARE HAVING NO INVOLVEMENT WITH THE LEGION BUSINESS
 
15  OTHER THAN OCCASIONALLY SIGNING CHECKS AND HOLDING BOARD
 
16  MEETINGS?
 
17       A    YES.  THIS IS WHAT SHE TOLD ME.
 
18       MR. WAIER:  YOUR HONOR, I HAVE BEEN VERY PATIENT.  I
 
19  SAID — I MADE MY OBJECTION ABOUT LEADING QUESTIONS THE
 
20  WAY, WITH RESPECT TO A WITNESS CALLED BY THE OTHER SIDE,
 
21  WOULD BE.  YOU HAVE A CONVERSATION, WHAT DATE, WHAT WAS
 
22  DISCUSSED, AS OPPOSED TO TELLING THEM WHAT WAS DISCUSSED AND
 
23  HAVING HIM ANSWER “YES” OR “NO".
 
24       THE COURT:  YOU ARE RIGHT.
 
25       MR. MUSSELMAN:  I'M MOVING AS FAST AS I CAN, YOUR
 
26  HONOR.
 
27
 
28
			
			

page  153
 
 
 
 1  BY MR. MUSSELMAN:
 
 2       Q    DID YOU HAVE ANY DISCUSSIONS WITH MR. FURR ON
 
 3  AUGUST 27, 1993?
 
 4       A    YES.  DURING THAT CONVERSATION WITH LAVONNE, SHE
 
 5  GOT LEWIS ON THE PHONE.
 
 6       MR. WAIER:  I'M GOING TO OBJECT AND MOVE TO STRIKE.  HE
 
 7  WAS ASKED A STRAIGHT-OUT QUESTION.  HE WAS NOT ASKED TO
 
 8  REFER TO A DOCUMENT.  HE’s BEEN REFERRING TO THE DOCUMENT ON
 
 9  HIS TESTIMONY.  HE WAS NOT ASKED TO HAVE THE RECOLLECTION
 
10  REFRESHED.
 
11       THE COURT:  SUSTAINED.
 
12
 
13  BY MR. MUSSELMAN:
 
14       Q    HAVE LEWIS OR LAVONNE FURR TOLD YOU THEY WERE
 
15  MANIPULATED BY MR. CARTO AS BOARD MEMBERS OF THE LEGION?
 
16       A    YES.
 
17       Q    DID THEY TELL YOU THAT ON AUGUST 28, 1993?
 
18       MR. WAIER:  I'M GOING TO OBJECT.  IT’s A LEADING
 
19  QUESTION.
 
20       THE COURT:  SUSTAINED.
 
21
 
22  BY MR. MUSSELMAN:
 
23       Q    DO YOU RECALL AT ANY TIME HAVING A DISCUSSION WITH
 
24  MR. FURR CONCERNING MR. Carto’s INFLUENCE ON HIM AS A BOARD
 
25  MEMBER OF THE LEGION?
 
26       A    YES.
 
27       Q    WHEN DO YOU RECALL HAVING THAT DISCUSSION?
 
28       A    DURING THIS CONVERSATION ON AUGUST 28TH.
			
			

page  154
 
 
 
 1       Q    WHAT DID HE TELL YOU ON THAT SUBJECT?
 
 2       A    HE SAID THAT HE AND LAVONNE HAD BEEN SERVING AS
 
 3  PUPPETS FOR MR. CARTO AND THEY WERE — WANTED TO BE DONE
 
 4  WITH THIS ALL, AND THEY WERE PLANNING ON RESIGNING.
 
 5       Q    EXHIBIT 59, PLEASE, DATED SEPTEMBER 16, 1993.
 
 6       A    YES.
 
 7       Q    HAVE YOU SEEN THAT BEFORE?
 
 8       A    YES.
 
 9       Q    WHEN DID YOU FIRST SEE IT?
 
10       A    COPY CAME TO US — I'M NOT SURE IF IT CAME IN THE
 
11  MAIL OR IF IT CAME FROM ONE OF THE CARBON-COPIED PEOPLE ON
 
12  THE BOTTOM.  BUT I'VE SEEN THIS IN THE FALL OF 1993, AROUND
 
13  SEPTEMBER 18 OR 20TH.
 
14       Q    DO YOU KNOW WHETHER OR NOT THE RESIGNATIONS WERE
 
15  EVER ACCEPTED?
 
16       MR. WAIER:  OBJECTION.  CALLS FOR HEARSAY.
 
17       THE COURT:  SUSTAINED.
 
18
 
19  BY MR. MUSSELMAN:
 
20       Q    ANYONE EVER TELL YOU THAT THE RESIGNATIONS WERE
 
21  ACCEPTED?
 
22       MR. WAIER:  OBJECTION.  CALLS FOR HEARSAY.
 
23       THE COURT:  SUSTAINED.
 
24
 
25  BY MR. MUSSELMAN:
 
26       Q    DID THE FURRS EVER TELL YOU THAT THEY KNEW THAT
 
27  THE RESIGNATIONS WERE ACCEPTED — STRIKE THAT.
 
28            DID MR. CARTO EVER TELL YOU THAT THE FURRS HAD
			
			

page  155
 
 
 
 1  RESIGNED?
 
 2       A    NO.
 
 3       Q    LOOKING AT EXHIBIT 63, PLEASE, DATED SEPTEMBER 21,
 
 4  1993, TELL ME IF YOU HAVE SEEN THAT BEFORE.
 
 5       A    I HAVE.
 
 6       Q    WHEN DID YOU FIRST SEE IT?
 
 7       A    I WOULD SAY AROUND OCTOBER OF 1993, EARLY OCTOBER.
 
 8       Q    DID YOU EVER DISCUSS THIS LETTER WITH MR. CARTO?
 
 9       A    NO.  BY THEN, MR. CARTO WAS NO LONGER WITH THE
 
10  CORPORATION.
 
11       Q    WERE YOU FORMALLY APPOINTED AS PRESIDENT OF THE
 
12  LEGION AT ANY TIME?
 
13       A    YES.
 
14       Q    WHERE WAS THAT?  I'M SORRY.  WHEN?
 
15       A    I'M NOT SURE IF IT WAS SEPTEMBER OR OCTOBER OF
 
16  1993, ONE OF THOSE 2 MONTHS.
 
17       Q    COULD YOU LOOK AT EXHIBIT 64, PLEASE, WHICH IS
 
18  DATED 1 OCTOBER 1993.
 
19       MR. WAIER:  I DON'T HAVE EXHIBIT 64.
 
20
 
21  BY MR. MUSSELMAN:
 
22       Q    HAVE YOU SEEN THAT BEFORE?
 
23       A    I HAVE.
 
24       Q    WHEN DID YOU FIRST SEE IT?
 
25       A    I SAW IT FIRST ON FRIDAY, OCTOBER 1ST, 1993.
 
26       Q    WHO WROTE IT?
 
27       A    I BELIEVE MARK WEBER WROTE IT, DRAFTED IT, AND WE
 
28  ALL LOOKED AT IT AND THEN WE DECIDED ON A FINAL COPY.  SO IT
			
			

page  156
 
 
 
 1  WAS A GROUP EFFORT.
 
 2       Q    DID YOU SIGN IT?
 
 3       A    I DID.
 
 4       Q    WAS IT SENT TO MR. CARTO?
 
 5       A    YES.
 
 6       Q    SUBSEQUENT TO THE SENDING OF THAT LETTER, DID
 
 7  MR. CARTO EVER TURN OVER TO THE LEGION THE FARREL ESTATE
 
 8  ASSETS?
 
 9       A    NO.
 
10       Q    HAS HE EVER TURNED OVER TO THE LEGION THE RECORDS
 
11  DEMONSTRATING WHERE THE FARREL ESTATE ASSETS ARE?
 
12       A    NO.
 
13       Q    WOULD YOU LOOK AT EXHIBIT 68, PLEASE, DATED
 
14  AUGUST 6, 1994.
 
15       A    I HAVE IT.
 
16       Q    HAVE YOU SEEN THAT BEFORE?
 
17       A    YES.
 
18       Q    WHEN DID YOU FIRST SEE IT?
 
19       A    AUGUST 6 OR THEREABOUT, 1994.
 
20       Q    AND WHO WROTE IT?
 
21       A    IT’s — I DON'T KNOW WHO WROTE IT.  I CAN SEE WHO
 
22  IT’s SIGNED BY.
 
23       Q    HOW WAS IT THAT YOU WERE SEEING IT?
 
24       A    IT CAME TO — THROUGH THE FAX MACHINE AT THE
 
25  LEGION’s OFFICE.
 
26       Q    HAVE YOU EVER SEEN LAVONNE FURR’s SIGNATURE
 
27  BEFORE?
 
28       A    YES.
			
			

page  157
 
 
 
 1       Q    IS THE SIGNATURE ON THIS PAGE SIMILAR TO THE
 
 2  SIGNATURE YOU HAVE SEEN IN THE PAST?
 
 3       A    YES.
 
 4       Q    HAVE YOU EVER SEEN LEWIS FURR’s SIGNATURE BEFORE?
 
 5       A    YES.
 
 6       Q    IS IT SIMILAR TO THE SIGNATURE YOU HAVE SEEN FOR
 
 7  HIM IN THE PAST?
 
 8       A    YES.
 
 9       Q    HAVE YOU EVER SEEN ELISABETH Carto’s SIGNATURE
 
10  BEFORE?
 
11       A    YES, I HAVE.
 
12       Q    IS THE SIGNATURE SIMILAR TO THE SIGNATURE YOU HAVE
 
13  SEEN FOR HER IN THE PAST?
 
14       A    YES.
 
15       MR. MUSSELMAN:  ONE MOMENT, YOUR HONOR.  IT MAY BE THE
 
16  END, HERE.
 
17
 
18  BY MR. MUSSELMAN:
 
19       Q    WHILE YOU WERE DIRECTOR OF THE LEGION, DID YOU
 
20  FEEL IT WAS WITHIN YOUR POWER TO COMMENCE LITIGATION FOR THE
 
21  LEGION?
 
22       MR. WAIER:  I'M SORRY.  SPEAK UP.
 
23       THE WITNESS:  I HEARD YOU FINE.
 
24       MR. WAIER:  I AM GOING TO OBJECT.  HIS OPINIONS ARE
 
25  IRRELEVANT.  I DON'T KNOW WHAT HE ASKED HIS OPINION OF.
 
26       THE COURT:  YES, IT’s LATE IN THE DAY.  RESTRAIN
 
27  YOURSELF.
 
28       MR. MUSSELMAN:  I THINK THAT’s IT.
			
			

page  158
 
 
 
 1       THE WITNESS:  I HAVEN'T ANSWERED THE QUESTION YET.
 
 2       MR. MUSSELMAN:  THAT’s ALL I HAVE, YOUR HONOR.
 
 3       THE COURT:  HOW LONG IS YOUR CROSS-EXAMINATION GOING TO
 
 4  BE?
 
 5       MR. WAIER:  QUITE LENGTHY, YOUR HONOR.
 
 6       THE COURT:  OKAY.  SEE EACH OTHER TOMORROW.
 
 7       MR. WAIER:  I DO HAVE A PROBLEM.  I TOLD YOU I HAVE TO
 
 8  LEAVE AT 11:30 TO GO TO REDLANDS FOR A PRELIMINARY HEARING
 
 9  AT 1:30.  ORIGINALLY, WE HAD MOTIONS IN LIMINE SCHEDULED FOR
 
10  THE MORNING AND I COULD HAVE HANDLED THAT.
 
11       THE COURT:  WE CAN BE OFF THE RECORD.
 
12
 
13                   (PROCEEDINGS RECESSED.)
 
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