Court of Civil Appeals of Texas, 2015

in Re TMX Finance of Texas, Inc., TitleMax of Texas, Inc., and TMX Finance LLC

Court of Civil Appeals of Texas · Decided March 18, 2015

Opinion

ACCEPTED 01-15-00126-CV FIRST COURT OF APPEALS HOUSTON, TEXAS 3/18/2015 6:22:24 PM CHRISTOPHER PRINE CLERK No. 01-15-00126-CV FILED IN In the Court of Appeals for the First District of 1st Texas COURT OF APPEALS HOUSTON, TEXAS ______________________________________________________________________________________________________________________________________________________________________________________________________ In re TMX Finance of Texas, Inc.; TitleMax of 3/18/2015 6:22:24 PM Texas, Inc.; and TMX Finance LLC CHRISTOPHER Clerk A. PRINE ______________________________________________________________________________________________________________________________________________________________________________________________________

Original Proceeding from the 152nd Judicial District Court, Harris County, Texas, Trial Court Cause No. 2013-33584, the Honorable Robert Schaffer, Presiding Judge ______________________________________________________________________________________________________________________________________________________________________________________________________

REAL PARTIES IN INTEREST’S RESPONSE TO RELATORS’ PETITION FOR WRIT OF MANDAMUS ______________________________________________________________________________________________________________________________________________________________________________________________________

SUTHERLAND ASBILL & WARGO & FRENCH LLP BRENNAN LLP Sarah F. Powers Daniel Johnson California State Bar No. 238184 Texas State Bar No. 24046165 [email protected] [email protected] (Pro Hac Admission Pending) Robert A. Lemus 1888 Century Park East, Suite 1520 Texas State Bar No. 24052225 Los Angeles, California 90067 [email protected] Telephone: (310) 853-6300 1001 Fannin Street, Suite 3700 Facsimile: (310) 853-6333 Houston, Texas 77002 Telephone: (713) 470-6100 Facsimile: (713) 654-1301 COUNSEL FOR REAL PARTIES IN INTEREST TABLE OF CONTENTS TABLE OF CONTENTS ............................................................................................i TABLE OF AUTHORITIES ................................................................................... iii STATEMENT OF THE CASE .................................................................................. v ISSUE PRESENTED .............................................................................................. vii I. INTRODUCTION ...........................................................................................1 II. STATEMENT OF FACTS .............................................................................. 4 A. Relators Engaged In Repeated Criminal Acts For The Purpose Of Converting LoanStar’s Customers While Mr. Bielss Oversaw Relators’ Operations In Texas ..............................4 B. The District Court Finds That Mr. Bielss Is A Fact Witness Who Has Relevant Testimony, And Denies Relators’ Motion .......................................................................6 C. The District Court’s Decision Is Supported By Evidence Demonstrating That Mr. Bielss Was Personally Involved In Relators’ Aggressive Growth And Marketing Strategies That Led To Their Illegal Conduct.............................................................................8 III. APPLICABLE STANDARD ........................................................................11 IV. DISCUSSION ................................................................................................12 A. The Apex Deposition Doctrine Does Not Apply To Preclude Discovery From Fact Witnesses Such As Mr. Bielss .......................................................................................12 B. LoanStar Is Entitled To Depose Mr. Bielss Because He Possesses Unique Or Superior Personal Knowledge Of Discoverable Information ...........................................14 C. LoanStar Is Also Entitled To Depose Mr. Bielss Because His Deposition Will Lead To The Discovery Of Admissible Evidence For Which Other Discovery Is Insufficient .........................18 i V. PRAYER........................................................................................................19 CERTIFICATION ...................................................................................................21 CERTIFICATE OF COMPLIANCE .......................................................................22 CERTIFICATE OF SERVICE ................................................................................22 APPENDIX ..............................................................................................................23

ii TABLE OF AUTHORITIES Page(s) Cases In re Alcatel USA, Inc., 11 S.W.3d 173, 176 (Tex. 2000) ................................................................. 14, 17 Baxter v. Palmigiano, 425 U.S. 308 (1976) ............................................................................................10 Boales v. Brighton Builders, Inc., 29 S.W.3d 159 (Tex. App.—Houston [14th Dist.] 2000, pet. denied) ...............13 In re BP Products North America, Inc., No. 01-06-00613-CV, 2006 WL 2192546 (Tex. App.—Houston [1st Dist.] Aug. 4, 2006, orig. proceeding) ........................................................16 Butnaru v. Ford Motor Co., 84 S.W.3d 198 (Tex. 2002).................................................................................12 City of Houston v. Harrison, 778 S.W.2d 916 (Tex. App.—Houston [14th Dist.] 1989, no writ) ...................12 In re Continental Airlines, Inc., 305 S.W.3d 849 (Tex. App.—Houston [14th Dist.] 2010, no pet.) ...................16 Crown Cent. Petroleum Corp. v. Garcia, 904 S.W.2d 125 (Tex. 1995) ....................................................................... 12, 13 Johnson v. Fourth Court of Appeals, 700 S.W.2d 916 (Tex. 1985) ..............................................................................12 Simon v. Bridewell, 950 S.W.2d 439 (Tex. App.—Waco 1997, no writ)...........................................13 Wilz v. Flournoy, 228 S.W.3d 674 (Tex. 2007) ..............................................................................10 Statutes TEX. TRANS. CODE §§ 730.007, 730.015 ...................................................................5

iii Rules TEX. R. EVID. 513(c) ................................................................................................10 TEX. R. CIV. P. 199.1(a)............................................................................................12

iv STATEMENT OF THE CASE Nature of Underlying This case involves claims by LoanStar against Relators Proceeding for misappropriation of trade secrets, tortious interference with contracts, and tortious interference with prospective business relations. (R.0001–0014.)

Throughout the underlying action, Relators have resisted discovery. (See R.0741–0751; R.0980–0981.) Indeed, the instant petition is the second filed in this case. In December 2014, Relators filed their first petition for writ of mandamus seeking reversal of the District Court’s denial of Relators’ motion for “apex” protection as to the deposition of Mr. Tracy Young, the sole employee, member and manager of Defendant TMX Finance LLC. (R.0161, n.2; cf. R.0498.) That petition remains pending.

The current mandamus proceeding relates to the deposition of Mr. Otto Bielss, who served as the Senior Vice President of Operations and oversaw Relators’ Texas market at the time that Relators’ employees were engaged in their illegal marketing scheme to convert LoanStar’s customer relationships. (R.0173–0184).

Despite previously agreeing to present Mr. Bielss for his deposition, in December 2014, Relators reversed course and filed a Motion for Protective Order to prevent Mr. Bielss’ deposition. As with Mr. Young, Relators have asserted that the “apex” deposition doctrine shields Mr. Bielss from deposition. (R.0160–0240.) Upon consideration of the pleadings and argument, the District Court, the Honorable Robert Schaffer presiding, denied Relators’ Motion and ordered the deposition of Mr. Bielss. (R.0481:18–19.) In doing so, the District Court found that “[Mr. Bielss] was, if not intimately, actively involved in what [TitleMax] was doing” and LoanStar sought to depose Mr. Bielss’ “as a fact witness.” (R.0477:4–6; R.0479:19–20.) The Court supported its finding with record evidence, for example, that Mr. Bielss “could be somewhat heavy handed in pushing people to perform and reach certain goals” and “was involved in v conversations where the subject matter of this lawsuit was discussed or may have been discussed.” (R.0477:18–25; R.0478:18–20.)

Respondent Honorable Robert Schaffer 152nd Judicial District Court Harris County, Texas Order and Ruling at January 23, 2015 Order Denying Defendants’ Motion for Issue Protective Order Regarding the Deposition of Otto Bielss. (R.0481:18–19) (no written order was entered).

vi ISSUE PRESENTED Whether the District Court, the Honorable Robert Schaffer presiding, properly exercised its discretion by denying Relators’ Motion for Protection from “Apex” Deposition of Otto Bielss, a mid-level manager who has personal knowledge of Relators’ practice of illegally searching of DMV records to identify and steal LoanStar’s customers, was intimately involved in the operations in Texas, and was also responsible for Relators’ aggressive growth strategy in Texas that led Relators to engage in that illegal conduct.

vii I. INTRODUCTION The District Court, the Honorable Robert Schaffer presiding, properly exercised its discretion in denying Relators’ Motion for Protection from “Apex” Deposition of Otto Bielss (the “Motion”). Under the facts of this case, Relators cannot carry the heavy burden of establishing that not even “some” evidence reasonably supported the District Court’s decision below.

In their “Issue Presented” and throughout their Petition, Relators misstate and attempt to minimize the evidence before the District Court, which showed Mr. Bielss’ personal knowledge of facts material to this litigation. In this regard, LoanStar presented the District Court with evidence that Mr. Bielss: (1) personally met with Relators’ employees throughout Texas to discuss the performance of their stores, including having conversations regarding marketing tactics; (2) was personally aware of and had communications regarding reports that Relators’ employees were illegally using Department of Motor Vehicle (“DMV”) records to solicit LoanStar’s customers; (3) personally conducted operations conference calls during which he aggressively questioned district managers regarding their performance, operations, and marketing efforts; (4) personally implemented an aggressive growth strategy that placed tremendous pressure on employees to sell Relators’ loans, including buyouts of competitors’ loans; and (5) personally oversaw Relators’ rapid expansion in the Texas title loan market.

When faced with this evidence, Judge Schaffer correctly noted that LoanStar was seeking Mr. Bielss’ deposition “testimony as a fact witness, not as a corporate rep[resentative],” (R.0479:19–20) and that “[Mr. Bielss] was, if not intimately, actively involved in what [TitleMax] was doing.” (R.0477:4–6.)

In their Petition, Relators assert that Mr. Bielss is a protected “apex” deponent because he is now the Chief Operating Officer of TMX Finance LLC. (Pet. at 11.) Relators, however, fail to disclose that Mr. Bielss was only recently installed in that position. Indeed, until recently, Mr. Bielss was a Senior Vice President of Operations with “direct supervisory authority over the folks that are accused of wrong doing in this case.” (R.0476:23–25.) LoanStar is entitled to depose Mr. Bielss regarding what he did (or did not do) to supervise these individuals, many of whom have conceded engaging in the illegal conduct forming the foundation of this case. For these reasons, Relators previously agreed to produce Mr. Bielss for deposition, both as a corporate representative for TitleMax and in his individual capacity. (R.0400–0402 [Emails from TitleMax counsel to LoanStar counsel dated August 16, 2014 agreeing to produce Mr. Bielss for deposition].) Upon retaining new counsel, however, TitleMax switched tack and for the first time asserted its erroneous “apex” argument. (Id.) In an effort to support this argument, Relators mischaracterize the evidence that establishes Mr. Bielss’ direct involvement in Relators’ marketing activities in Texas. For example, Relators assert that LoanStar did “not show that Mr. Bielss was involved in marketing strategies at the store level.” (Pet. at 11.) Putting aside that Mr. Bielss does not have to be involved in marketing at the store level in order to have relevant personal knowledge, Relators’ statement is contradicted by Relators’ general manager James Griffin, who testified about a meeting in which he discussed the store’s marketing efforts with Mr. Bielss. (R.0381–0383.)

Relators further rely on Mr. Bielss’ affidavit, by which he claims not to have “firsthand personal knowledge” concerning Relators’ illegal marketing activities, although he admits that he has “limited knowledge regarding this information.” (R.0186, ¶¶ 3–4.) Mr. Bielss’ admitted “limited knowledge” itself precludes application of the “apex” doctrine. Moreover, Mr. Bielss’ assertion that he lacks “firsthand” knowledge is contradicted by the sworn testimony of other of Relators’ employees (including, but not limited to, Mr. Griffin). LoanStar is entitled to discover the credibility of Mr. Bielss’ affidavit, and in particular the extent of his knowledge and approval of Relators’ wrongful conduct.

Additionally, LoanStar is entitled to take Mr. Bielss’ deposition in order to controvert Relators’ argument that their employees’ illegal marketing activities were not approved by management and instead were the result of the conduct of rogue employees. LoanStar will demonstrate for the jury that Relators’ position in this regard is simply incredible, as their employees’ illegal conduct occurred across their Texas regional operations (each headed by a different regional manager). To do so, LoanStar must depose Mr. Bielss, who was one of only two of Relators’ employees who oversaw and implemented the marketing strategies across their Texas regions. Even if Mr. Bielss denies directing or encouraging Relators’ illegal marketing activities, LoanStar is entitled to explore the credibility of such an unbelievable denial.

Accordingly, Relators have failed to establish that the District Court abused its discretion. In denying Relators’ Motion for Protection, the District Court properly determined that Mr. Bielss is a fact witness, and accordingly that the “apex” doctrine does not apply to prevent LoanStar from taking his deposition.

LoanStar thus respectfully requests that the Court deny Relators’ Petition.

II. STATEMENT OF FACTS A. Relators Engaged In Repeated Criminal Acts For The Purpose Of Converting LoanStar’s Customers While Mr. Bielss Oversaw Relators’ Operations In Texas Both Relators and LoanStar operate title-lending businesses that involve the issuance of loans secured by a customer’s vehicle. (See R.0001–0014.) From 2011 to 2013, Relators implemented an aggressive growth strategy across the state of Texas, by which they expanded from two to 230 stores over a two-year period, splitting the state into multiple regions. (See R.0507–0510; R.0593–0595 & n.5.)

To foster their rapid growth, Relators illegally accessed DMV records to obtain

personal information from thousands of Texas citizens and LoanStar customers and market to those same individuals. (Id.; see also R.0001–0014.) A list of potentially stolen customers, prepared by Special Master Judge David Peeples, includes over 140,000 line entries. Facing not only civil, but also criminal penalties,1 numerous employees of Relators have invoked their Fifth Amendment right to avoid self-incrimination, including one of Relators’ Regional Managers. 2 During the pertinent time frame, Mr. Bielss served as the Senior Vice President of Operations 3 for the entire Texas market, overseeing all of the employees who engaged in the illegal conduct. (R.0280; R.0287–0290; R.0321– 0323.) Mr. Bielss personally played an active role in Relators’ aggressive marketing strategies used to grow its operations in Texas. (R.0287–0290, ¶¶ 6–9; R.0321–0323, ¶¶ 4–5; R.0477:4–6.) Additionally, in 2012, Mr. Bielss communicated with other TitleMax employees regarding allegations that TitleMax employees were canvassing competitors’ parking lots and illegally searching DMV See TEX. TRANS. CODE §§ 730.007, 730.015.

To date, four of Relators’ employees have exercised their Fifth Amendment rights: Felix DeLeon, Lucia Grajeda, and Ishmael Hernandez, all General Managers, and James Batterson, a Regional Manager. (See R.0846–0853 [Felix DeLeon Dep.]; R.0854–0858 [Lucia Grajeda Dep.]; R.0859–0872 [Ishmael Hernandez Dep.]; R.0576–0590 [James Batterson Dep.]; see also R.0993:17–24; R.1039:5–9.)

As the Senior Vice President of Operations, Mr. Bielss reported directly to Tracy Young. (R.0288, ¶ 5.) databases. (R.0539–0540 [McDonald Dep. 78–80 (“I received a call from [Mr. Bielss] saying that allegations were made, that we were—that an employee was going to a parking lot of a competitor. . . . In 2012 there was also another allegation that we were using or an employee was using a DMV database search.”)]) 4; see also (R.0287–0290 [Affidavit of Donald H. (“Landers Affidavit”), ¶¶ 7–8]; R.0377–0384 [James Griffin (General Manager) Dep. 172–176 (“The sales were good, so he just wanted to know what we were doing marketingwise [sic] to get the sales to where they were”)].)

LoanStar accordingly seeks to depose Mr. Bielss regarding his personal knowledge of these matters, and the direction employees received as to the illegal conduct in which multiple employees engaged.

B. The District Court Finds That Mr. Bielss Is A Fact Witness Who Has Relevant Testimony, And Denies Relators’ Motion In August 2014, LoanStar and Relators first discussed scheduling the deposition of Mr. Bielss. Recognizing that Mr. Bielss has unique knowledge relevant to the present case, Relators’ former counsel agreed to produce Mr. Bielss for deposition. (R.0400–0402.) LoanStar accordingly noticed Mr. Bielss’ deposition in December 2014. (R.0256–266; R.0267–0278.) Rather than present Realtors inaccurately assert that LoanStar improperly submitted into the Court record testimony from Ms. McDonald that was marked “Attorney’s Eyes Only.”

However, none of the deposition testimony LoanStar cited was so designated. (See R.0575 [reflecting the “Attorney’s Eyes Only” designations].)

Mr. Bielss for deposition consistent with the Parties’ prior discussions and agreement, Relators’ new counsel reversed course and filed the Motion to prevent his deposition. (See R.0160–0243; R.0412–0419.)

At the January 23, 2015 hearing on the Motion, the District Court found that LoanStar was “seeking Mr. Bielss’ testimony as a fact witness, not as a corporate rep[resentative].” The Court concluded that Mr. Bielss had “direct supervisory authority over the folks that are accused of wrong doing in this case” and it seemed like “he was, if not intimately, actively involved in what [TitleMax] was doing.” (R.0476–0477.) In doing so, the Court noted that TitleMax employees provided sworn testimony indicating that Mr. Bielss “could be somewhat heavy handed in pushing people to perform and reach certain goals” and “was involved in conversations where the subject matter of this lawsuit was discussed or may have been discussed.” (R.0477–0478.) Additionally, the Court observed that Mr. Bielss “was at meetings” where high-pressure marketing tactics were discussed and LoanStar “want[ed] to know what went on in those meetings.” (R.0479–0480; R.0321–0323, ¶ 5]; R.0287–0290, ¶ 8].) The District Court accordingly denied Relators’ Motion and ordered Mr. Bielss to appear for deposition. (R.0481.)

Unsatisfied with the District Court’s ruling, for the second time in this case,5 Relators filed a Petition for Writ of Mandamus.

C. The District Court’s Decision Is Supported By Evidence Demonstrating That Mr. Bielss Was Personally Involved In Relators’ Aggressive Growth And Marketing Strategies That Led To Their Illegal Conduct LoanStar presented evidence to the District Court showing that Mr. Bielss has unique, firsthand knowledge of material facts relevant to this lawsuit. As the Senior Vice President of Operations for Relators, Mr. Bielss oversaw Relators’ rapid expansion in the Texas market and implemented an aggressive growth strategy that placed tremendous pressure on employees to sell Relators’ loans, including buyouts of competitors’ loans. (R.0280–0285; R.0287–0290 [Landers Affidavit, ¶¶ 6, 9]; R.0507–0510 [Linda McDonald Dep. 10–11 (expansion from two to 230 stores over a two year period), 14–15]; R.0299–0303 [Richard Todd Hale (General Manager) Dep. 23–24]; R.0304–0309 [James Griffin (General Manager) Dep. 131, 140–141]; R.0310–0314 [Joshua Hadden (General Manager) On October 24, 2014, LoanStar noticed the deposition of Tracy Young, the sole employee, member, and manager of Defendant TMX Finance. (R.0161–0168.)

LoanStar seeks his deposition to discover TMX Finance’s involvement in Relators’ illegal marketing activities. As with Mr. Bielss, Relators filed a Motion for Protection in an attempt to prevent Mr. Young’s deposition on the ground that he is an “apex” deponent—thereby, completely ignoring that the inapplicability of the doctrine to Mr. Young and disregarding Mr. Young’s knowledge of relevant information. (Cf. R.0158–0159.) On November 24, 2014, the District Court denied Relators’ Motion for Protection as to Mr. Young. (Id.) Relators then filed a Petition for Writ of Mandamus, which is currently pending before this Court as Case No. 01-14-00964-CV. (See R.0161, n.2.)

Dep. 62–63]; see R.0315–0319 [Ernest Page (General Manager) Dep. 79–80]; R.0321–0323 [Baker Affidavit, ¶¶ 4–5].) It was during Mr. Bielss’ direct oversight and management of the Texas market that Relators’ employees began engaging in illegal marketing practices to identify and convert LoanStar’s customer relationships throughout the state of Texas, and continued to do so over several years. (See, e.g., R.0325–0334 [Randy Rainey (General Manager) Dep. 37–44]; R.0335–0342 [Hale Dep. 23–24, 42–44]; R.0343–0348 [Griffin Dep. 129–131].)

As the individual overseeing operations for the state of Texas, Mr. Bielss was aware of reports that Relators’ employees were soliciting customers of competitors in parking lots and using DMV databases for marketing purposes. In late 2012, Mr. Bielss was in contact with Ms. McDonald regarding these allegations. (R.0539–0540 [relating a call from Mr. Bielss regarding TitleMax’s use of DMV databases].) Mr. Bielss also consulted with Relators’ in-house counsel regarding the allegations, and communicated with the legal department regarding Relators’ marketing practices before and after LoanStar initiated litigation against Relators. (R.0392–0396 [TitleMax Privilege Log entries TMX0013–0014 (Email from Vin Thomas to Otto Bielss dated November 26, 2012 “for the purpose of facilitating the rendition of legal advice related to correspondence from [LoanStar’s in-house counsel]”) and TMX0017 (Email from Otto Bielss to Vin Thomas dated November 27, 2012 “for the purpose of facilitating the rendition of legal advice regarding marketing practices”)]; R.0395 [TitleMax Privilege Log entries TMX0015; TMX0016].) 6 Mr. Bielss’ knowledge of Relators’ illegal marketing conduct is unsurprising. As the Senior Vice President of Operations, Mr. Bielss was involved with Relators’ marketing efforts as Relators aggressively expanded operations in the Texas market. Multiple current and former TitleMax employees have testified that Mr. Bielss actively monitored operations in Texas and personally fostered an environment where employees were likely to “engage in improper practices in order to meet the performance goals.” (R.0287–0290, ¶ 9; see generally R.0322.)

On regular conference calls, Mr. Bielss would question regional and district managers regarding their performance, and “berate” them, “even if they met performance metrics, in order to remind them that [they] were all expendable and

Mr. Bielss also may have been in contact with other employees regarding the illegal marketing practices. One of Relators’ regional managers asserted his Fifth Amendment privilege when questioned about his interactions with Mr. Bielss, including discussion of marketing practices and the use of DMV databases. (R.0576–0590 [James Batterson Dep.].) Mr. Bielss thus presumptively interacted with Mr. Batterson concerning marketing practices and the use of DMV databases.

See Baxter v. Palmigiano, 425 U.S. 308, 318 (1976) (allowing adverse presumption because “the [Fifth] Amendment does not preclude the inference where the privilege is claimed by a party to a Civil cause.”) (citation omitted); Wilz v. Flournoy, 228 S.W.3d 674, 677 (Tex. 2007) (“jury in this civil case was free to draw negative inferences from the Flournoys’ repeated invocations of the Fifth Amendment”); TEX. R. EVID. 513(c) (excepting “civil cases” from rule prohibiting adverse inferences).

numbers were king.” (R.0322, ¶ 5; R.0289, ¶¶ 7–8.) Mr. Bielss also personally met with Relators’ employees throughout the state to discuss the performance of their stores, including having conversations regarding marketing tactics (R.0287– 0290, ¶¶ 7–8; R.0377–0384.)

Further, Mr. Bielss’ responsibilities as Senior Vice President of Operations necessitated his involvement in and awareness of Relators’ employees’ day-to-day operations. In this regard, Mr. Bielss maintained and worked out of an office in Dallas, Texas (R. 0536); supervised and coordinated with the Divisional Vice President, Linda McDonald, regarding opening new stores and hiring employees (R.0536–0537]); attended training sessions of new hires (R.0359–0362 [Page Dep.

90]; R.0363–0367 [Arturo Guerrero (General Manager) Dep. 27–28]; R.0368– 0371 [Gilberto Hernandez (General Manager) Dep. 26]); and sent emails to Relators’ employees directing them to maximize resources to grow the business (R.0372–376 [Antonio Amado (General Manager) Dep. 46–47]). There is accordingly no question that Mr. Bielss has unique and superior personal knowledge of relevant facts, and that the District Court properly concluded that Mr. Bielss should be deposed as a fact witness III. APPLICABLE STANDARD Mandamus issues only to correct a clear abuse of discretion or the violation of a duty imposed by law when there is no other adequate remedy by law. City of Houston v. Harrison, 778 S.W.2d 916, 918 (Tex. App.—Houston [14th Dist.]

1989, no writ) (citing Johnson v. Fourth Court of Appeals, 700 S.W.2d 916 (Tex. 1985)). A trial court abuses its discretion when it reaches a decision so arbitrary and unreasonable as to amount to a clear and prejudicial error of law. Id. A relator who attacks the ruling of a trial court as an abuse of discretion labors under a heavy burden. Id. The relator must establish, under the circumstances of the case, that the facts and law permit the trial court to make but one decision. Id.; see also Butnaru v. Ford Motor Co., 84 S.W.3d 198, 211 (Tex. 2002) (“The trial court does not abuse its discretion if some evidence reasonably supports the trial court's decision.”) (emphasis added). Here, Relators have entirely failed to meet this strict burden.

IV. DISCUSSION A. The Apex Deposition Doctrine Does Not Apply To Preclude Discovery From Fact Witnesses Such As Mr. Bielss The apex deposition doctrine provides an exception to the general rule favoring broad discovery of relevant matters; it protects high-level executive officers from deposition where the officers lack knowledge of relevant facts and were noticed for deposition based upon their corporate positions. See Crown Cent.

Petroleum Corp. v. Garcia, 904 S.W.2d 125, 128–29 (Tex. 1995). Cf. TEX. R. CIV. P. 199.1(a). Where a party seeks to depose an officer because he has knowledge of a discoverable matter, the apex deposition doctrine does not shield the officer from deposition. See Boales v. Brighton Builders, Inc., 29 S.W.3d 159, 168 (Tex. App.—Houston [14th Dist.] 2000, pet. denied) (“First, we note that the ‘apex’ doctrine does not apply. Appellants do not seek to depose Krugh merely because of his corporate position. Rather they seek to depose him because they allege he has first-hand knowledge of certain facts[.]”); Simon v. Bridewell, 950 S.W.2d 439, 442 (Tex. App.—Waco 1997, no writ) (“A corporate officer is not exempt from deposition by the ‘apex’ doctrine merely because he is a corporate official. Rather, the doctrine may be invoked only when the deponent has been noticed for deposition because of his corporate position.”) (emphasis added).

Indeed, notwithstanding the “apex” status of a high-level executive officer, the officer may be deposed if: (1) the noticing party has arguably shown that the officer has any unique or superior personal knowledge of discoverable information, or (2) the noticing party has made a good faith effort to obtain discovery through less intrusive methods, there is a reasonable indication that the officer’s deposition is calculated to lead to the discovery of admissible evidence, and the less intrusive methods of discovery are unsatisfactory, insufficient or inadequate. See Crown Cent. Petroleum Corp., 904 S.W.2d at 128 (if the party seeking the deposition has “arguably shown that the official has any unique or superior personal knowledge of discoverable information,” the trial court should deny a motion for apex

protection) (emphasis added); In re Alcatel USA, Inc., 11 S.W.3d 173, 176 (Tex. 2000) (same).

As discussed below, Mr. Bielss has firsthand knowledge of facts relevant to the underlying litigation and LoanStar seeks his deposition for this purpose.

Consequently, the District Court properly concluded that the apex deposition does not shield Mr. Bielss from deposition in this case.

B. LoanStar Is Entitled To Depose Mr. Bielss Because He Possesses Unique Or Superior Personal Knowledge Of Discoverable Information LoanStar noticed the deposition of Mr. Bielss because he possesses knowledge of facts relevant to the claims and defenses in this case, and not because of his current corporate position. Indeed, Mr. Bielss has sworn that he has actual knowledge of discoverable information. (See R.0186, ¶¶ 3–4 (“I have limited knowledge regarding this information[.]”).) Notwithstanding Mr. Bielss’ characterization of his knowledge as “limited,” the evidence demonstrates that Mr. Bielss possesses unique or superior personal knowledge of discoverable information about which he can be deposed. (See supra Section II.C.)

Mr. Bielss was the only Senior Vice President of Operations for the Texas market, and was in charge of Relator’s operations and marketing strategy throughout Texas. He occupied a unique role in which he not only monitored all of Relators’ operations and marketing efforts across Texas, but also had “direct supervisory authority over the folks that are accused of wrong doing in this case.” (R.0476:23–25; see also supra Section II.C.) Relators’ attempt to misdirect the Court regarding Mr. Bielss’ role as the Senior Vice President of Operations and the knowledge he acquired through that position, by directing the Court solely to his new position as the Chief Operating Officer of TMX Finance LLC, is unavailing. (Pet. at 11.) Regardless of his current title, LoanStar is entitled to discover Mr. Bielss’ personal knowledge regarding Relators’ operations in Texas and his involvement with the aggressive growth strategy that fostered the environment in which the illegal marketing practices arose. 7 (See supra, Section II.C.)

Furthermore, although Relators have taken the position that their employees’ illegal marketing activities were “not approved by corporate” and only engaged in by a few rogue employees (R.0977; R. 1080), LoanStar is entitled to discover evidence proving that the widespread nature of the activity demonstrates otherwise. (See R.0593–0595.) LoanStar is similarly entitled to obtain evidence proving that the pattern of Relators’ illegal conduct across separate regions throughout the State of Texas—even in stores that are hundreds of miles apart—is not coincidental given that one man controlled marketing for the entire State. Thus, Mr. Bielss’ In fact, if LoanStar were only interested in deposing Mr. Bielss because of his status as Chief Operating Officer, LoanStar would not have sought to depose him before he assumed that position. (Compare R.400–402 [Emails from TitleMax counsel to LoanStar counsel dated August 16, 2014 regarding Mr. Bielss deposition] with R.0280 [reflecting Bielss’ executive appointment in October 2014].)

involvement in and knowledge of Relators’ illegal marketing practices is a matter that LoanStar is entitled to explore through his deposition.

Based on the evidence described herein, the District Court properly rejected Relators’ attempts to present a corporate representative in Mr. Bielss’ place, observing that LoanStar was seeking Mr. Bielss’ deposition “testimony as a fact witness, not as a corporate representative.” (R.0479:19–20.) Mr. Bielss’ monitoring of Relators’ operations and marketing efforts through meetings with regional and district managers across the Texas market, puts him in a unique position to testify about the scope and spread of the illegal conduct in Relators’ stores. (R.0322, ¶ 5; R.0287–0290.) As the District Court noted, LoanStar “want[s] to know what went on in those meetings.” (R.0481:4–5.)

Mr. Bielss’ position as the Senior Vice President of Operations afforded him the opportunity to assess and understand the operations—including marketing activities—of all of Relators’ stores in Texas. Thus, unlike the executives in In re Continental Airlines, Inc., 305 S.W.3d 849 (Tex. App.—Houston [14th Dist.]

2010, no pet.), and In re BP Products North America, Inc., No. 01-06-00613-CV, 2006 WL 2192546 (Tex. App.—Houston [1st Dist.] Aug. 4, 2006, orig. proceeding), who did not have any personal knowledge of relevant matters and were noticed for deposition based upon their corporate positions, Mr. Bielss’ role as the Senior Vice President of Operations afforded him superior personal knowledge of Relators’ operations than any lower-level employees. Accordingly, the District Court properly concluded that Mr. Bielss should be required to testify about these matters.

In an effort to bolster Relators’ apex argument and distance himself from his prior responsibilities as the Senior Vice President of Operations, Mr. Bielss executed an Affidavit. 8 The Affidavit is insufficient in the first instance to invoke the “apex” doctrine, however, because through it Mr. Bielss does not “deny any knowledge of relevant facts” or deny that he has “superior knowledge” of Relators’ marketing activities across Texas. In re Alcatel USA, Inc., 11 S.W.3d at 175–76.

Instead, Mr. Bielss simply attests that he has no “firsthand” personal knowledge of Relators’ “marketing or soliciting customers of competitors” or the “day-to-day operations or marketing activities of any TitleMax store in Texas.” (R.0186, ¶¶ 2, 3.) Whether Mr. Bielss ever personally marketed to or solicited any customers is inconsequential, (cf. Pet. at 11) as Mr. Bielss’ knowledge of Relators’ operations and marketing efforts is at issue.

Mr. Bielss submitted a pro forma affidavit substantially similar to the affidavit submitted by Tracy Young in support of Relators’ Motion for Protective Order regarding Mr. Young’s deposition. The paragraphs in which both men deny any firsthand knowledge of relevant facts are nearly identical. (Compare R.0186, ¶¶ 3– [Affidavit of Otto Bielss] with R.0501, ¶ 3 [Affidavit of Tracy Young].)

Although Mr. Bielss’ Affidavit implies that he has no such knowledge, LoanStar presented evidence to the District Court demonstrating otherwise. (See supra, Section II.C [deposition testimony of Relators’ employees].) For example, LoanStar presented the deposition testimony of Relators’ general manager James Griffin, who testified that he discussed his store’s marketing efforts in detail with Mr. Bielss during his visit to the store. (R.0381–0383.) Given the discrepancies between Mr. Bielss’ Affidavit and the other evidence presented, LoanStar is entitled to depose Mr. Bielss to discover the actual extent of his personal knowledge so that the jury can evaluate his credibility.

Because Mr. Bielss has unique or superior knowledge of facts relevant to this case, the District Court thus correctly denied Relators’ Motion for Protection.

C. LoanStar Is Also Entitled To Depose Mr. Bielss Because His Deposition Will Lead To The Discovery Of Admissible Evidence For Which Other Discovery Is Insufficient Additionally, LoanStar is entitled to depose Mr. Bielss because his deposition is likely to lead to the discovery of admissible evidence that other methods of discovery are unsatisfactory, insufficient, or inadequate to obtain.

Through the deposition of Mr. Bielss, LoanStar seeks information regarding the scope of his knowledge of and involvement in Relators’ marketing practices, and the discrepancies between the testimony of Relators’ employees and his Affidavit.

The other available methods of discovery are insufficient to address these

inquiries. The full details of Mr. Bielss’ knowledge could not be obtained through interrogatories, and depositions of other employees would only reflect their personal knowledge.9 Furthermore, LoanStar already has served requests for production of documents on Relators and issued a subpoena for Mr. Bielss, but has not yet received a document production. Assuming documents are eventually produced, only Mr. Bielss will be able to testify regarding his knowledge and actions taken with respect to the documents. Given that Mr. Bielss’ deposition is likely to lead to discovery of admissible evidence, the apex deposition doctrine does not shield him from deposition. Accordingly, the District Court correctly denied Relators’ Motion for Protection, and the Court should deny the Petition.

V. PRAYER The District Court did not abuse its discretion by ordering the deposition of Mr. Bielss. The evidence demonstrates that the apex deposition doctrine does not protect Mr. Bielss because he is a fact witness and his current executive position is unrelated to LoanStar’s bases for deposing him. Indeed, as the only Senior Vice President of Operations in Texas, Mr. Bielss was personally aware of and had discussions about Relators’ illegal marketing conduct, and was responsible for Realtors’ aggressive growth strategy in Texas that led to such conduct. LoanStar Additionally, Relators’ employees may assert their Fifth Amendment privileges if questioned about their interactions with Mr. Bielss. (See supra n.2.)

thus may depose Mr. Bielss regarding his knowledge of and involvement in the spread of Realtors’ illegal conduct throughout the state. Because the District Court properly exercised its discretion in rejecting Relators’ apex deposition argument and denying their Motion, LoanStar respectfully requests that the Court deny Relators’ Petition for Writ of Mandamus in its entirety and affirm the decision of the District Court.

Respectfully submitted, SUTHERLAND ASBILL & BRENNAN LLP By: /s/ Daniel Johnson Daniel Johnson (SBN 24046165) Robert A. Lemus (SBN 24052225) 1001 Fannin Street, Suite 3700 Houston, Texas 77002 Telephone: (713) 470-6100 Facsimile: (713) 654-1301 E-mail: [email protected] E-mail: [email protected] And WARGO & FRENCH LLP Sarah F. Powers (CA No. 238184) (Pro Hac Admission Pending) 1888 Century Park E, Suite 1520 Los Angeles, California 90067 Telephone: (310) 853-6300 Facsimile: (310) 853-6333 E-mail: [email protected] Attorneys for Real Parties In Interest Wellshire Financial Services, LLC, d/b/a LoanStar Title Loans, d/b/a MoneyMax Title Loans, and d/b/a LoanMax; Meadowwood Financial Services, LLC, d/b/a LoanStar Title Loans, and d/b/a MoneyMax Title Loans; and Integrity Texas Funding, LP

CERTIFICATION I certify that I have reviewed this petition and have concluded that every factual statement in this response to the petition is supported by competent evidence included in the appendix or record.

/s/ Daniel Johnson Daniel Johnson

CERTIFICATE OF COMPLIANCE This response contains 4,544 words, excluding the parts exempted by Texas Rule of Appellate Procedure 9.4(i)(1) with regard to other filings.

/s/ Daniel Johnson Daniel Johnson CERTIFICATE OF SERVICE This is to certify that I have this day served all parties with a copy of the within and foregoing instrument in accordance with the Texas Rules of Appellate Procedure 6.3 and 9.5(b), (d), (e), to all counsel of record on this 18th day of March 2015.

Via e-filing and/or U.S. Mail Roland Garcia, Jr. L. Bradley Hancock Mary Olga Lovett Christopher David Johnsen GREENBURG TRAURIG, LLP 1000 Louisiana, Suite 1700 Houston, Texas 77002 (Attorneys for Relators TMX Finance of Texas, Inc.; TitleMax of Texas, Inc.) Via e-filing and/or U.S. Mail Geoff Gannaway Bryon Rice BECK REDDEN LLP 1221 McKinney St., Suite 4500 Houston, Texas 77010 (Attorneys for Relator TMX Finance, LLC) /s/ Daniel Johnson Daniel Johnson APPENDIX TAB Real Parties In Interest’s Mandamus Record Defendants' Motion for Protection From Apex Deposition of Tracy Young, Exhibit B (R.0498-0501) ..................................................................... P Plaintiffs' Response to Defendant's Motion for Protective Order Regarding the Deposition of Otto Beilss, Exhibits D and G and Email from Relators' Counsel Regarding Attorney Eyes Only Designations of Deposition of Linda McDonald (R.0502-0575) ............................... Q Deposition of James Batterson and Email from Relators' Counsel Regarding Attorney Eyes Only Designations of Deposition of James Batterson (R.0576-0590) .................................................................................. R Plaintiffs’ Omnibus Response to Defendants’ Motions for Protective Order, Discovery Limits, to Compel Disclosure of Damages Calculations, and Mediation filed July 16, 2014 (R.0591-0740) .............................................................................................................S Plaintiffs' Motion to Compel Discovery Responses from Defendants TMX Finance LLC, TMX Finance of Texas, Inc., and TitleMax of Texas, Inc. to Requests for Production of Documents (R.0741-0890) ..........................................................................................T Transcript from Hearing on November 21, 2014 (R.0891-1077) ............................... U Transcript from Hearing on July 18, 2014 (Excerpt) (R.1078-1081) ......................... V Cases Cited In re Alcatel USA, Inc., 11 S.W.3d 173 (Tex. 2000) .........................................................................................1 Baxter v. Palmigiano, 425 U.S. 308 (1976) ....................................................................................................2

Boales v. Brighton Builders, Inc., 29 S.W.3d 159 (Tex. App.—Houston [14th Dist.] 2000, no pet.) .............................. 3 In re BP Products North America, Inc., No. 01-06-00613-CV, 2006 WL 2192546 (Tex. App.—Houston [1st Dist.] Aug. 4, 2006, orig. proceeding) ................................................................. 4 Butnaru v. Ford Motor Co., 84 S.W.3d 198 (Tex. 2002) .........................................................................................5 City of Houston v. Harrison, 778 S.W.2d 916 (Tex. App.—Houston [14th Dist.] 1989, no writ) ...........................................................................................6 In re Continental Airlines, Inc., 305 S.W.3d 849 (Tex. App.—Houston [14th Dist.] 2010, no pet.) ............................ 7 Crown Cent. Petroleum Corp. v. Garcia, 904 S.W.2d 125 (Tex. 1995) .......................................................................................8 Simon v. Bridewell, 950 S.W.2d 439 (Tex. App.—Waco 1997, no writ) ................................................... 9 Wilz v. Flournoy, 228 S.W.3d 674 (Tex. 2007) .......................................................................................10

Tab P NO. 2013-33584 WELLS HIRE FINANCIAL SERVICES, LLC, § IN THE DISTRICT COURT d/b/a LOANSTAR TITLE LOANS, d/b/a § MONEYMAX TITLE LOANS, and d/b/a § LOANMAX; MEADOWWOOD FINANCIAL § SERVICES, LLC, d/b/a LOANSTAR TITLE § LOANS, and d/b/a MONEYMAX TITLE § LOANS; and INTEGRITY TEXAS § FUNDING, LP, § § Plaintiffs, § § v. § OF HARRIS COUNTY, TEXAS § TMX FINANCE HOLDINGS, INC.; § TMX PINANCE LLC; § TMX FINANCE OF TEXAS, INC.; and § TITLEMAX OF TEXAS, INC.; § § Defendants. § 152ND JUDICIAL DISTRICT

DEFENDANTS' MOTION FOR PROTECTION FROM APEX DEPOSITION OF TRACY YOUNG TO THE HONORABLE ROBERT SCHAFFER: Defendants TMX Finance of Texas, Inc., TitleMax of Texas, Inc., and TMX Finance LLC ("Defendants" or "TitleMax") file this Motion for Protection from Apex Deposition of Tracy Young and in support thereof would respectfully show the Court as follows.

INTRODUCTION On October 24, 2014, Plaintiffs noticed the deposition of Tracy Young for November 24, 2014. See Notice of the Oral and Videotaped Deposition of Tracy Young, attached as Exhibit A. Defendants object to presenting Mr. Young for a deposition. He is the CEO of the Defendants, and falls squarely within the definition of an "apex" deponent, because he has not been shown to have the requisite "unique or superior personal knowledge" to justify his 1130.00001/551776.vll

0498 EXHIBIT B

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0501 Tab Q NO. 2013-33584 WELLSHIRE FINANCIAL SERVICES, LLC, § IN THE DISTRICT COURT d/b/a LOANSTAR TITLE LOANS, d/b/a § MONEYMAX TITLE LOANS, and d/b/a § LOANMAX; MEADOWWOOD FINANCIAL § SERVICES, LLC, d/b/a LOANSTAR TITLE § LOANS, and d/b/a MONEYMAX TITLE § LOANS; and INTEGRITY TEXAS § FUNDING, LP, § § Plaintiffs, § OF HARRIS COUNTY, TEXAS § v. § § TMX FINANCE HOLDINGS, INC.; § TMX FINANCE, LLC; § TMX FINANCE OF TEXAS, INC.; and § TITLEMAX OF TEXAS, INC., § § Defendants. § 152"d JUDICIAL DISTRICT PLAINTIFFS' RESPONSE TO DEFENDANTS' MOTION FOR PROTECTIVE ORDER REGARDING THE DEPOSITION OF OTTO BIELSS COME NOW, Plaintiffs Wellshire Financial Services, LLC d/b/a LoanStar Title Loans, d/b/a Money Max Title Loans, and d/b/a LoanMax; Meadowwood Financial Services, LLC, d/b/a LoanStar Title Loans, and d/b/a MoneyMax Title Loans; and Integrity Texas Funding, LP, (collectively, "LoanStar") and hereby file this response to Defendants TMX Finance LLC, TMX Finance of Texas, Inc., and TitleMax of Texas, Inc.'s (collectively, "TitleMax") Motion for Protective Order regarding the Deposition of Otto Bielss ("Motion"), and respectfully show the Court as follows: I. INTRODUCTION TitleMax is improperly asserting the apex deposition doctrine in an attempt to prevent LoanStar from proceeding with the deposition of a TitleMax employee who possesses knowledge of discoverable information-Otto Bielss. Mr. Bielss served as the Senior Vice

25373482.1 0502 EXHIBIT D 0503 ATTORNEYS EYES ONLY Page 1 ATTORNEYS' EYES ONLY 1 NO. 2 013-33584 2 WELLSHIRE FINANCIAL SERVICES, IN THE DISTRICT COURT LLC., d/b/a LOANSTAR TITLE 3 LOANS and INTEGRITY TEXAS FUNDING, LP, Plaintiffs, 5 vs. OF HARRIS COUNTY, TEXAS TMX FINANCE HOLDINGS, INC.; 6 TMX FINANCE, LLC. ; TMX FINANCE OF TEXAS, INC.; 7 TITLEMAX OF TEXAS, INC. ; FELIX DeLEON; and ISHMAEL 8 HERNANDEZ, 9 Defendants.

10 I 12 ATTORNEYS' EYES ONLY 13 VIDEOTAPE DEPOSITION OF LINDA McDONALD TAKEN: Pursuant to Notice by 15 Counsel for the Plaintiffs 16 PLACE: Hunter MacLean E. Saint Julian Street 17 Savannah, GA 31401 18 DATE: Thursday, May 1, 2014 19 TIME: Began: 8:57 a.m.

Ended: 12:34 p.m.

BEFORE: TRACIE L. THOMPSON, RPR, CRR, CLR 21 Notary Public State of Florida at Large Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0504 ATTORNEYS EYES ONLY Page 2 ATTORNEYS' EYES ONLY 1 APPEARANCES 2 For the Plaintiffs: SARAH F. POWERS, ESQ.

CHRISTINA GOEBELSMANN, ESQ.

3 Wargo French 1888 Century Park East 4 Suite 1520 Los Angeles, CA 90067 5 305-913-8587 [email protected] 6 [email protected] 9 For the Defendants: STEPHEN T. LaBRIOLA, ESQ.

Fellows LaBriola, LLP 10 225 Peachtree Street, NE Suite 2300, South Tower 11 Atlanta, GA 30303 404-586-9200 12 [email protected] 14 VICTORIA H. NEWMAN, ESQ.

TMX Finance 15 15 Bull Street Suite 200 16 Savannah, GA 31401 912-503-2824 17 [email protected] 19 Also Present: Diana Gundelfinger, Videographer * * * * * * * Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0505 ATTORNEYS EYES ONLY Page 3

I-N-D-E-X 3 WITNESS DIRECT CROSS REDIRECT RECROSS 4 LINDA McDONALD 5 By Ms. Powers 5 129 6 By Mr. LaBriola 128 8 * * * * * * * 11 E-X-H-I-B-I-T-S 12 DESCRIPTION PAGE 14 Exhibit 1 Letter dated 5-14-13 ............... 88 16 Exhibit 2 Packet of various documents ........ 92 18 Exhibit 3 E-mail chain . . . . . . . . . . . . . . . . . . . . . . 117 20 Exhibit 4 Notice of Deposition .............. 120 22 * * * * * * *

Veri text Florida Reporting Co. 800-726-7007 305-376-8800 0506 ATTORNEYS EYES ONLY Page 10 1 A Yes.

2 Q Okay. By whom?

3 A By TMX Finance of Texas.

4 Q Is that TMX Finance of Texas, Inc.?

5 A LLC.

6 Q And how long were you in that position?

7 A I was in that position from March of 2011 8 until April -- until November 18th, 2013.

9 Q And what was your job title there?

10 A Divisional vice president.

11 Q And what were your duties and 12 responsibilities as divisional vice president?

13 A To oversee operations.

14 Q Okay. And in that position, were you 15 overseeing the operations of TitleMax stores?

16 A Yes.

17 Q Okay. How many stores?

18 A It fluctuated throughout my tenure, but 19 when I left, when I resumed new responsibilities in 20 November; approximately 230 in Texas.

21 Q And all of the stores were in Texas?

22 A Yes.

23 Q Were you responsible for all of the stores 24 in Texas?

25 A Yes.

Veritext Florida Repmiing Co. 800-726-7007 305-3 76-8800 0507 ATTORNEYS EYES ONLY Page 11 1 Q And during the entire time that you were 2 employed as a divisional vice president of TMX 3 Finance of Texas, were you responsible for all of the 4 stores in Texas?

5 A Yes.

6 Q And you said that the number of stores 7 varied. Approximately how many stores were there 8 when you started in that position?

9 A Two.

10 Q And during the tenure of your time as a 11 divisional vice president of TMX Finance of Texas, 12 you've stated your duties and responsibilities were 13 to oversee operations, but can you define that a 14 little bit further and give me an idea of what that 15 means?

16 A To oversee operations is to oversee 17 staffing. So staffing, hiring, training and profit 18 and loss duties.

19 Q Okay. And what did your profit and loss 20 duties entail?

21 A Performance management.

22 Q Were you responsible for marketing in any 23 way?

24 A Yes, for training of marketing, yes.

25 Q Before March of 2011, were you employed by Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0508 ATTORNEYS EYES ONLY Page 14 1 before, left and went to CheckSmart and then came 2 back and were a regional manager again?

3 A Correct.

4 Q How long were you a regional manager in 5 that time before CheckSmart?

6 A I was hired -- January of 2007 was my 7 official hire date.

8 Q Okay. And prior to January '07, did you 9 work for any of the TitleMax entities?

10 A No. 11 Q As a regional manager from that time, 12 January '07 through April '09, was that in Georgia?

13 A I started in Georgia and trained in Georgia 14 for approximately three months and then I moved to 15 Columbia, South Carolina and I was a regional manager 16 for CheckMax, which was our company's payday loan 17 division.

18 Q Why did you leave TitleMax to go to 19 CheckSmart for that brief period of time?

20 A Our company went through a bankruptcy and I 21 was laid off.

22 Q Today I'm going to focus on the time in 23 which you were a divisional vice president for TMX 24 Finance of Texas, LLC, during that period of time 25 from March 2011 through November 2013, who did you Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0509 ATTORNEYS EYES ONLY Page 15 1 report to during that time?

2 A Otto Biells.

3 Q Who is Mr. Biells?

4 A Senior vice president.

5 Q Of TMX Finance of Texas?

6 A Correct.

7 MR. LaBRIOLA: You probably want a spelling 8 for his last name. It's unusual.

9 BY MS . POWERS : 10 Q Yes. How do you Biells?

11 A B-I-E-L-L-S.

12 Q B-E-I-E -- 13 A B-I-E-L-L-S.

14 Q B-I-E-L-L-S, okay.

15 A I had to think of it for a second.

16 Q Now we've been discussing TMX Finance of 17 Texas, LLC, is there also a TMX of Texas, Inc.?

18 A Yes.

19 Q How are the two different, if you know?

20 A They're two different business entities.

21 Q What is the difference between the two's 22 operations?

23 A The difference, I'm not sure I understand.

24 Q What do they do differently, if anything?

25 A They do the same, it's just a different Veritext Florida RepDiiing Co. 800-726-7007 305-376-8800 0510 Page 1 CAUSE NO. 2013-33584 WELLSHIRE FINANCIAL * IN THE DISTRICT COURT SERVICES, LLC, d/b/a * LONESTAR TITLE LOANS and * INTEGRITY TEXAS FUNDING, * LP, * * Plaintiffs * * vs. * HARRIS COUNTY, TEXAS * TMX FINANCE HOLDINGS, * INC.; TMX FINANCE, LLC; * TMX FINANCE OF TEXAS, * INC.; TITLEMAX OF TEXAS, * INC.; FELIX DeLEON; and * ISHMAEL HERNANDEZ, * * Defendants * 152ND JUDICIAL DISTRICT ******************************************************** ORAL AND VIDEOTAPED DEPOSITION OF RICHARD TODD HALE MAY 15, 2014 ******************************************************** ORAL AND VIDEOTAPED DEPOSITION OF RICHARD TODD HALE, produced as a witness at the instance of the PLAINTIFFS, and duly sworn, was taken in the above-styled and numbered cause on the 15th of MAY, 2014 from 9:06a.m. to 2:50p.m., before MELISSA PARKHILL, CSR, in and for the State of Texas, reported by computer-assisted machine shorthand, at the law offices of Sutherland Asbill & Brennan, 600 Congress Avenue, Suite 2000, Austin, Travis

0511 Page 2 County, Texas, pursuant to the Texas Rules of Civil Procedure and the provisions stated on the record or attached hereto.

0512 Page 3 1 A P P E A R A N C E S FOR THE PLAINTIFFS: 4 Sarah F. Powers, Attorney at Law -and- 5 Christina Goebelsmann, Attorney at Law WARGO FRENCH 6 1888 Century Park East, Suite 1520 Los Angeles, California 90067 7 (305) 913-8587 [email protected]

10 FOR THE DEFENDANTS: 11 Geoff Gannaway, Esq.

BECK REDDEN, LLP 12 1221 McKinney, Suite 4500 Houston, Texas 77030 13 (713) 951-6263 [email protected] ALSO PRESENT: 17 Cody Hall, Videographer

0513 Page 23 two documents in there that are e-mails that were sent -- well, i t was a conversation between myself and.

3 Mr. Sudduth regarding marketing specifically with what this case I think is involved in, which has to do marketing using public databases. Okay. And in those e-mails, one of them -- And I'm paraphrasing. I don't know i t off the top of my head. But we have the e-mail, so we can demonstrate it. Mr. Sudduth -- Mr. Sudduth well, let me go back -- let me Can I go back? Let me go back to this because to answer to your question ties in with with the chronological stuff here.

12 Q. Absolutely. Please continue.

13 MR. GANNAWAY: Object to form.

14 A. Do you remember -- Going back to where he says let's explore different types of marketing, after this audit when the store was not meeting goals and I just got there is when Mr. Sudduth had a conversation with me and said, Todd, you're going to have to start doing more buyouts. That's the way all of the successful stores are -- are getting it done. You're going to have to -- you're going to have to do more buyouts.

22 And there was an extreme amount of pressure. And i t was very apparent that -- you know, it was -- it was you're going to have to do this or else. I mean, i t was that type of conversation. And it was

0514 Page 24 during that when I was like, okay.

2 Again, also keep in mind, I'd never worked in the title loan industry before. I've never worked for another title loan company. So I know really nothing about how i t worked, the laws, statutes that regulate it.

6 Everything I did learn about it, I learned from the vantage point of TitleMax or what TitleMax believed was right and what should be done.

9 It was during that conversation that Mr. Sudduth instructed me to -- about the Public Database and to to use the -- how to use the Public Database and to be able to look up information on that to be able to market specifically and target potential customers clients that already had an existing title loan.

15 Q. Okay. Now, let me 16 MR. GANNAWAY: Okay. I'm going to object to the responsiveness before your next question.

18 Q. Let me stop you there for just a second. When was i t that Mr. Sudduth first introduced to you the concept of using a database to look up customers that had title loans with TitleMax's competitors?

22 MR. GANNAWAY: Object to form.

23 A. I don't remember the exact date. I know it was roughly around it was -- after right roughly after this. So Sept late September, 2012.

0515 Page 1 1 NO. 2013-33584 2 WELLSHIRE FINANCIAL SERVICES, * IN THE DISTRICT COURT LLC, d/b/a LOANSTAR TITLE * 3 LOANS and INTEGRITY TEXAS * FUNDING, LP *· 4 * vs. * HARRIS COUNTY, TEXAS 5 * TMX FINANCE HOLDINGS, INC.; * 6 TMX FINANCE, LLC; TMX FINANCE * OF TEXAS, INC.; TITLEMAX OF * 7 TEXAS, INC.; FELIX DELEON; * AND ISHMAEL HERNANDEZ * 152ND JUDICIAL DISTRICT 10 ******************************************* 11 ORAL AND VIDEOTAPED DEPOSITION OF 12 JAMES ARTHUR GRIFFIN 13 MAY 23, 2014 14 VOLUME 1 15 ******************************************* 16 ORAL AND VIDEOTAPED DEPOSITION OF JAMES 17 ARTHUR GRIFFIN, produced as a witness at the instance 18 of the Plaintiffs and duly sworn, was taken in the 19 above-styled and numbered cause on the 23rd day of May, 20 2014, from 9:08a.m. to 2:09p.m., before Marsha Evans, 21 Certified Shorthand Reporter in and for the State of 22 Texas, reported by machine shorthand, at.600 Congress 23 Avenue, 20th Floor, Austin, Texas, pursuant to the 24 Texas Rules of Civil Procedure and the provisions 25 stated on the record or attached hereto.

Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0516 Page 2 1 APPEARANCES FOR THE PLAINTIFFS: MS. CHRISTINA GOEBELSMANN 5 MS. SARAH F. POWERS WARGO FRENCH 6 1888 Century Park East, Suite 1520 Los Angeles, California 90067 7 310-853-6807/310-853-6859 (fax) [email protected] 8 spowers®wargofrench.com FOR THE DEFENDANTS: MR. GEOFF GANNAWAY 11 BECK REDDEN 1221 McKinney Street, Suite 4500 12 Houston, Texas 77010 713-951-6263/713-951-3720 (fax) 13 ggannaway®beckredden.com 14 --and-- 15 MS. VICTORIA NEWMAN (Via Telephone) TMX FINANCE 16 15 Bull Street, Suite 200 Savannah, Georgia 31401 17 912-503-2824/912-629-1538 (fax) victoria.newman®titlemax.biz 19 ALSO PRESENT: 20 Mr. Manuel Martin, Videographer Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0517 Page 3 1 INDEX PAGE Appearances. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 4 JAMES ARTHUR GRIFFIN 5 Examination by Ms. Goebelsmann ............. . 6 Examination by Mr. Gannaway ................ . 190 6 Further Examination by Ms. Goebelsmann ..... . 214 Further Examination by Mr. Gannaway ........ . 217 7 Further Examination by Ms. Goebelsmann ..... . 217 8 Changes and Corrections . . . . . . . . . . . . . . . . . . . . . . . . . 219 9 Signature . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 220 10 Reporter's Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . 221 12 EXHIBITS 14 NO. DESCRIPTION PAGE/LINE REFERENCED Exhibit 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7/2 16 Notice of the Oral and Videotaped Deposition of James A. Griffin and Subpoena 17 Duces Tecum 18 Exhibit 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56/9 Lists of names with loans Exhibit 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99/9 20 E-mails dated September 15, 2012, with attachment Exhibit 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 133/22 22 E-mails dated November 27, 2012 23 Exhibit 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 145/5 E-mails dated October 20, 2012, with 24 attachments Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0518 n over the "so many extra, but I don't remember the exact number. As I remember it, the account would actually shut down and you weren't allowed to do anything until the new month rolled around, as I remember it.

6 Q. Did you record any of the buyouts that you performed of LoanStar loans?

8 A. There may have been notations on the marketing sheet just because there's a lot of pressure or emphasis being put on that and I wanted to be able to talk to whoever came in and asked me how it was going.

12 I've sent out X number of letters and I've got this many responses back. It may have been notated on the marketing sheets, but it was nothing formal.

15 Q. And those were the sheets contained in the marketing binder?

17 A.• Correct.

18 Q. Would any of the general records maintained by TitleMax reflect the buyouts made to LoanStar?

20 MR. GANNAWAY: Object to form.

21 THE WITNESS: Based upon the record keeping that was in place when I was there I would say yes.

24 Q. (By Ms. Goebelsmann) And why is that?

25 A. Well, as you see in this e-mail, we

0519 1 A. No, I don't think so. 2 Q. Do you know if any other stores in Texas had similar gentleman's agreements?

4 A. I don't know for sure.

5 Q. Did you make any other requests for lists based upon zip codes similar to the e-mail that's in Exhibit 4?

8 MR. GANNAWAY: Object to form.

9 THE WITNESS: Because I had heard that Felix had a second list, which was more of a list from the one that Patrick had dropped off to me, yes, I did go to Felix and ask him for -- for my zip codes.

13 Q. (By Ms. Goebelsmann) Did anyone come to you asking you for a zip code list?

15 A. HR and I may have talked about it. Actually I think I did give HR some zip codes from the first list that Patrick gave me. 18 Q. And why is that?

19 A. Because HR and I were so close in proximity.

20 I think there was less than a mile between our two stores. There's an incredible amount of pressure to get loans and an incredible amount of pressure to to market to get the loans. As I said, the belief at TitleMax is that if you're not getting loans it's not because of anything other than poor marketing.

0520 1 MR. GANNAWAY: Object to the responsiveness.

3 Q. (By Ms. Goebelsmann) Did you ever search the DMV databases using the names of lenders?

5 A. No. 6 Q. Did you come up with any other marketing practices in order to increase your loan volume?

8 A. Of course, we had banners that we would hang on the side of our trucks or on our windows that advertised no-interest loans, and we would park at an angle next to the street. Just anything to visually try to get a customer's -- a potential customer's attention as they came through.

14 Q. And why did you come up with those additional marketing practices?

16 A. As I mentioned earlier, there's an incredible amount of pressure. We were, for the most part -- I mentioned that Todd and I had a bit of a disagreement over marketing boundaries, but for the most part we were a pretty close-knit group. And if one guy said, man, I'm kind of feeling some pressure here, you know, we would kind of brainstorm and come up with different ideas to try to get people's attention. So these are ideas that were shared amongst us.

25 Q. Were those marketing ideas that you came up

0521 Page 1 NO. 2013-33584 WELLSHIRE FINANCIAL ) IN THE DISTRICT COURT SERVICES, LLC, d/b/a ) LOANSTAR TITLE LOANS and ) INTEGRITY TEXAS FUNDING, ) LP, ) ) Plaintiffs, ) ) vs. ) OF HARRIS COUNTY, TEXAS ) TMX FINANCE HOLDINGS, ) INC.; TMX FINANCE, LLC; ) TMX FINANCE OF TEXAS, ) INC.; TITLEMAX OF TEXAS, ) INC.; FELIX DeLEON; ) and ISHMAEL HERNANDEZ, ) ) Defendants. ) 152ND JUDICIAL DISTRICT ********************************************************** ORAL VIDEOTAPED DEPOSITION JOSHUA HADDEN June 18th, 2013 ********************************************************** ORAL VIDEOTAPED DEPOSITION OF JOSHUA HADDEN, produced as a witness at the instance of the Plaintiff and duly sworn, was taken in the above-styled and numbered cause on June 18th, 2013, from 10:03 a.m. to 1:07 p.m., before Margaret Raiford, Certified Shorthand Reporter in and for the State of Texas, reported by computerized stenotype machine at the offices of Sutherland Asbill & Brennan; 600 Congress Ave., Suite

0522 Page 2 2000; Austin, TX 78701, pursuant to the Texas Rules of Civil Procedure and the provisions stated on the record or attached hereto.

0523 Page 3 1 APPEARANCES FOR PLAINTIFFS: 3 Mr. Joseph D. Wargo Wargo French 4 999 Peachtree St., NE 26th Floor 5 Atlanta, Georgia 30309 Telephone: 404.853.1500 6 Fax: 404.853.1506 E-mail: [email protected] FOR CORPORATE DEFENDANTS: 8 Mr. David J. Beck Beck Redden 9 1221 McKinney St., Suite 4500 Houston, TX 77010 10 Telephone: 713.951.6209 Fax: 713.951.3720 11 E-mail: [email protected] FOR CORPORATE DEFENDANTS: Mr. Bryon A. Rice 13 Beck Redden 1221 McKinney St., Suite 4500 14 Houston, TX 77010 Telephone: 713.951.6256 15 Fax: 713.951.3720 E-mail: [email protected] FOR CORPORATE DEFENDANTS, TMX FINANCE OF TEXAS, INC., AND TITLEMAX OF TEXAS, INC.: Mr. Stephen T. LaBriola 18 Fellows LaBriola Suite 2300, South Tower 19 225 Peachtree Street, NE Atlanta, Georgia 30303 20 Telephone: 404.586.9200 Fax: 404.529.4028 21 E-mail: [email protected]

0524 Page 62 to you whether that customer came through the process that you've .identified here today?

3 A. Yes.

4 Q. ~d did it?

5 A. Yes.

6 Q. Did you ever express to anyone any discomfort you had with the -- this process?

8 A. Are you talking about during the -- when -- when we were doing them?

10 Q. What -- yes, sir.

11 A. No. 12 Q. Okay. What about upon your departure or close to when you -- when you were deciding to leave, did you ever tell anyone internally that you had some kind of discomfort with this process?

16 A. I did send out an e-mail when I resigned -- the day that I resigned kind of explaining some of my frustrations with TitleMax, and the buyout letter process was -- was one of those. How, you know, we were instructed to do something that was, you know, unethical and possibly illegal, and that i t was one of the few things that was actually working and with all the pressure, you know, of the new loans, we finally found something that was working and then we were told to stop; so, there was a lot of frustration there. So,

0525 Page 63 yeah, I mean, I guess I kind of expressed my frustration on that to the Austin region and to Linda McDonald.

3 Q. Who is Linda McDonald?

4 A. She is the divisional president. She's over, like, all of Texas and possibly some other areas.

6 Q. You used the words "unethical" and "illegal."

7 Was i t your belief at that time that you just testified about that this process was unethical or illegal?

9 A. At that time, yes.

10 Q. And -- and what -- what gave you that belief?

11 A. Just the fact that there was a lawsuit, you know, regarding it.

13 Q. Okay. Earlier you testified that -- and I'm -- I just want to get you back to that testimony, something about not telling people when they showed up in town or something like that?

17 A. Yes.

18 Q. That's not exactly what you said, but do you remember what you said?

20 A. Yes. There -- 21 Q. What were you referring to there?

22 A. -- there there was a time, I believe i t was probably sometime in February, where we got a phone call from the store manager on the Riverside store; they called him Rad -- I think his name was Rademez or

0526 Page 1 1 NO. 2013-33584 2 WELLSHIRE FINANCIAL SERVICES, * IN THE DISTRICT COURT LLC, d/b/a LOANSTAR TITLE * 3 LOANS and INTEGRITY TEXAS * FUNDING, LP * 4 * vs. * HARRIS COUNTY, TEXAS 5 * TMX FINANCE HOLDINGS, INC.; * 6 TMX FINANCE, LLC; TMX FINANCE * OF TEXAS, INC.; TITLEMAX OF * 7 TEXAS, INC.; FELIX DELEON; * AND ISHMAEL HERNANDEZ * 152ND JUDICIAL DISTRICT 10 ******************************************* 11 ORAL AND VIDEOTAPED DEPOSITION OF 12 ERNEST PAGE 13 MAY 23, 2014 14 VOLUME 1 15 ******************************************* 16 ORAL AND VIDEOTAPED DEPOSITION OF ERNEST 17 PAGE, produced as a witness at the instance of the 18 Plaintiffs and duly sworn, was taken in the 19 above-styled and numbered cause on the 23rd day of May, 20 2014, from 3:38p.m. to 6:17p.m., before Marsha Evans, 21 Certified Shorthand Reporter in and for the State of 22 Texas, reported by machine shorthand, at 600 Congress 23 Avenue, 20th Floor, Austin, Texas, pursuant to the 24 Texas Rules of Civil Procedure and the provisions 25 stated on the record or attached hereto.

Veritext Florida Repmiing Co. 800-726-7007 305-376-8800 0527 Page 2 1 APPEARANCES FOR THE PLAINTIFFS: MS. CHRISTINA GOEBELSMANN 5 MS. SARAH F. POWERS WARGO FRENCH 6 1888 Century Park East, Suite 1520 Los Angeles, California 90067 7 310-853-6807/310-853-6859 (fax) cgoebelsmann®wargofrench.com 8 spowers®wargofrench.com FOR THE DEFENDANTS: MR. GEOFF GANNAWAY 11 BECK REDDEN 1221 McKinney Street, Suite 4500 12 Houston, Texas 77010 713-951-6263/713-951-3720 (fax) 13 ggannaway®beckredden.com ALSO PRESENT: Mr. Manuel Martin, Videographer Veritext Florida Repotiing Co. 800-726-7007 305-376-8800 0528 Page 3 1 INDEX PAGE Appearances. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 4 ERNEST PAGE 5 Examination by Ms. Powers .................. . 4 Examination by Mr. Gannaway................. 102 6 Further Examination by Ms. Powers .......... . 112 7 Reporter's Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . 119 8 EXHIBITS 9 NO. DESCRIPTION PAGE/LINE REFERENCED 10 Exhibit 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . , . . . . . . . . . . 5/25 First Amended Notice of the Oral and 11 Videotaped Deposition of Ernest Page and Subpoena Duces Tecum Exhibit 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36/8 13 E-mails dated September 15, 2012 14 Exhibit 3........................................ 56/12 E-mails dated October 20, 2012, with 15 attachment 16 Exhibit 4........................................ 66/20 E-mails dated September 15, 2012, with 17 attachment Veritext Florida Repmiing Co. 800-726-7007 305-376-8800 0529

1 had three different regionals that were all also basically in training.

3 Q. And who was there from corporate during your training in Dallas?

5 A. I couldn't tell you the names. I mean, I couldn't.

7 Q. Were there written materials involved in your training?

9 A. Yes.

10 Q. And did you take those written materials with you when you went to your store?

12 A. Yes.

13 Q. Where were those materials kept?

14 A. Actually those were kept -- some of it was kept at the store, and a lot of it was training stuff, just at my house. I'd keep it in my home.

17 Q. Do you still have any of those materials 18 A. No. 19 Q. -- at your home?

20 A. Not at all.

21 Q. And you said you spent a week training in Savannah, correct?

23 A. Yes, ma'am.

24 Q. What occurred there?

25 A. That's more of a -- that training -- you're

VERITEXT REPORTING SERVICES (800) 567-8658 0530

1 basically done with the rest of the training. That's more o f - - i t ' s -- 99 percent is how to sell. It's -- they weed you out. They're very aggressive about-- you can go three months of training and get terminated in that one week if you're not-- if you're not really gung ho, if you're not real fiery. They don't want real mellow people. They don't want subdued people.

8 If -- they put you in scenario after scenario after scenario day in and day out. It's like your apt in front of everybody else and they're grading you. It's eight hours every day of of hanging from chandeliers and standing and dancing. I mean, that's what we used to call i t because that's what they want to see.

15 I mean, I -- we started -- in my class when I was there from all over the United States there was probably 27 of us. Like 21, 22 made it. We lost about five, six maybe -- I couldn't tell you exact number -- just because they weren't they weren't excited enough. They weren't fired up enough. And that was basically -- that week was i t wasn't training you on anything else other than just have a lot of get-up-and-go.

24 Q. Did that week include role-playing?

25 A. There was a lot of role-playing.

VERITEXT REPORTING SERVICES (800) 567-8658 0531 EXHIBIT G 0532 ATTORNEYS EYES ONLY Page 1 ATTORNEYS' EYES ONLY 1 NO. 2013-33584 2 WELLSHIRE FINANCIAL SERVICES, IN THE DISTRICT COURT LLC., d/b/a LOANSTAR TITLE 3 LOANS and INTEGRITY TEXAS FUNDING, LP, Plaintiffs, 5 vs. OF HARRIS COUNTY, TEXAS TMX FINANCE HOLDINGS, INC.; 6 TMX FINANCE, LLC. ; TMX FINANCE OF TEXAS, INC.; .7 TITLEMAX OF TEXAS, INC. ; FELIX DeLEON; and ISHMAEL 8 HERNANDEZ, 9 Defendants.

Ended: 12:34 p.m.

BEFORE: TRACIE L. THOMPSON, RPR, CRR, CLR 21 Notary Public State of Florida at Large Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0533 ATTORNEYS EYES ONLY Page 2 ATTORNEYS' EYES ONLY 1 APPEARANCES 2 For the Plaintiffs: SARAH F. POWERS, ESQ.

CHRISTINA GOEBELSMANN, ESQ.

3 Wargo French 1888 Century Park East 4 Suite 1520 Los Angeles, CA 90067 5 305-913-8587 [email protected] 6 [email protected] 9 For the Defendants: STEPHEN T. LaBRIOLA, ESQ.

Fellows LaBriola, LLP 10 225 Peachtree Street, NE Suite 2300, South Tower 11 Atlanta, GA 30303 404-586-9200 12 slabriola®fellab.com 14 VICTORIA H. NEWMAN, ESQ.

TMX Finance 15 15 Bull Street Suite 200 16 Savannah, GA 31401 912-503-2824 17 [email protected] 19 Also Present: Diana Gundelfinger, Videographer ******* Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0534 ATTORNEYS EYES ONLY Page 3

Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0535 ATTORNEYS EYES ONLY Page 30 1 frequently, because I oversaw 250 stores, but if I 2 was going to visit a region, a particular region, I 3 might pick three of the underperforming stores to 4 visit, versus, you know, out of five stores, and 5 visit two top performing stores. I always mixed it 6 up, but in 250 stores, you can only see every store 7 possibly once a year.

8 Q During this time period that we're 9 discussing did either TMX Finance of Texas, Inc. or 10 TitleMax of Texas, Inc. have a central corporate 11 office?

12 A Our company has two corporate offices. One 13 in Dallas and one in Savannah.

14 Q Are those offices also stores?

15 A No. 16 Q And if you know, who works out of the 17 Dallas office that you've just described?

18 MR. LaBRIOLA: Can you put a time frame on 19 that?

20 BY MS. POWERS: 21 Q Yes. During the time period from 22 March 2011 through November '13, and if it changed 23 during that time period, please let me know.

24 A Otto Biells officed out of the Dallas 25 office, the corporate office, but he also officed out Veritext Florida Repmiing Co. 800-726-7007 305-376-8800 0536 ATTORNEYS EYES ONLY Page 60 1 an ASM, an SM and a GM?

2 A Yes.

3 Q Are those larger stores?

4 A Yes.

5 Q And then they have CSRs under them; is that 6 correct?

7 A Yes.

8 Q What's the maximum number of CSRs that any 9 of your stores had during that time period?

10 MR. LaBRIOLA: Objection as to form.

11 THE WITNESS: If you're speaking about the 12 highest volume store that we had, I'm guessing, 13 to be honest 14 BY MS. POWERS: 15 Q Yeah, don't guess.

16 A I can give you a range of five to seven.

17 Q Okay.

18 A But again, I'm not 100 percent sure.

19 Q Okay. Did you ever discuss your marketing 20 strategies with Otto Biells?

21 A No. 22 Q When did you speak with Otto Biells, and I 23 believe you've testified that was on a weekly basis, 24 correct?

25 A Approximately.

Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0537 ATTORNEYS EYES ONLY Page 61 1 Q Okay.

2 A There were weeks that I didn't talk to him, 3 but in general, I spoke to him once a week.

4 Q Okay. When you did speak to him, what did 5 you discuss?

6 A Our business, operations.

7 Q And was it just you reporting what you were 8 doing?

9 A Not necessarily. Just talking about the 10 business, discussing the regional managers, their 11 performance, their leadership opportunities.

12 Sometimes it would be about opening markets, that we 13 were opening stores and planning on staffing.

14 Q And did Otto Biells ever give you any sort 15 of instruction?

16 A Yes.

17 Q And what did he instruct you on?

18 A He would instruct me on hiring people, how 19 many people we needed to hire.

20 Q Anything else?

21 A I'm trying to think. I can't think of 22 anything else really, what he would instruct me on.

23 Q During the time period that we've been 24 discussing, the March 2011 to November 2013, did you 25 ever speak with Tracy Young?

Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0538 ATTORNEYS EYES ONLY Page 78 1 it's not an ethical practice. So our president 2 has encouraged us to make sure that's not 3 happening. So I haven't heard of it happening.

4 I've been coached not to allow it to happen.

5 BY MS . POWERS : 6 Q Okay. Did you ever hear of any TitleMax 7 employee doing that practice prior to November 2011?

8 A No. 9 Q And do you know which employee or employees 10 were accused of doing that in November of 2011?

11 A No, I don't.

12 Q Do you know which region or store was 13 involved?

14 A No. 15 Q After November 2011, did you ever hear of 16 this practice occurring?

17 A After 2011, the following year in November 18 I received a call from my supervisor saying that 19 allegations were made, that we were that an 20 employee was going to a parking lot of a competitor.

21 Q Was your supervisor who called you Otto 22 Biells?

23 A Yes.

24 Q And do you know who the employee or 25 employees involved were?

Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0539 ATTORNEYS EYES ONLY Page 79 1 A No. 2 Q What did you do in response to that 3 November 2012 call?

4 A In 2012 there was also another allegation 5 that we were using or an employee was using a DMV 6 database search and he asked me to call individually 7 each regional manager and make sure, first, to find 8 out if it was occurring, that it needed to be 9 reported back.

10 Second, to make sure our -- each employee 11 understood that we don't condone that. It's not 12 allowed. It's against policy, and to make sure to 13 reiterate that.

14 Q And did you call each regional manager 15 individually?

16 A I did call each regional manager 17 individually. I did discuss with them that it was 18 not allowed. It was a violation of policy and that 19 they needed to check with their district managers and 20 make sure they understood the policy, also make sure 21 and ask them if they were aware of either of these 22 practices happening. The district managers were then 23 instructed to call each general manager and 24 communicate the same thing and then it needed to be 25 communicated back to me if anybody was aware of it Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0540 ATTORNEYS EYES ONLY Page 80 1 happening and that everybody had been reminded of the 2 policies and the proper practices. And that's what 3 happened.

4 Q And when you made these calls to the 5 regional managers, did that also occur in 6 November 2012?

7 A Yes.

8 Q And when you made these calls, were you 9 able to reach all of your regional managers?

10 A I was.

11 Q And did any of them say anything to you 12 about that practice occurring?

13 A No. 14 Q And did you ever receive a report back from 15 anyone about that practice occurring?

16 A No. 17 Q In the November 2011 incident, did you ever 18 hear about the DMV database being utilized?

19 A I'm sorry, say that again.

20 Q You mentioned that in November 2012 there 21 was an additional allegation that the DMV database 22 had been searched, correct?

23 A Correct.

24 Q Was that also an issue in November 2011?

25 A No. Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0541 Page 1 1 NO. 2013-33584 2 WELLSHIRE FINANCIAL SERVICES, * IN THE DISTRICT COURT LLC, d/b/a LOANSTAR TITLE * 3 LOANS and INTEGRITY TEXAS * FUNDING, LP * 4 * vs. * HARRIS COUNTY, TEXAS 5 * TMX FINANCE HOLDINGS, INC.; * 6 TMX FINANCE, LLC; TMX FINANCE * OF TEXAS, INC.; TITLEMAX OF * 7 TEXAS, INC.; FELIX DELEON; * AND ISHMAEL HERNANDEZ * 152ND JUDICIAL DISTRICT 10 ******************************************* 11 ORAL AND VIDEOTAPED DEPOSITION OF 12 ERNEST PAGE 13 MAY 23, 2014 14 VOLUME 1 15 ******************************************* 16 ORAL AND VIDEOTAPED DEPOSITION OF ERNEST 17 PAGE, produced as a witness at the instance of the 18 Plaintiffs and duly sworn, was taken in the 19 above-styled and numbered cause on the 23rd day of May, 20 2014, from 3:38p.m. to 6:17p.m., before Marsha Evans, 21 Certified Shorthand Reporter in and for the State of 22 Texas, reported by machine shorthand, at 600 Congress 23 Avenue, 20th Floor, Austin, Texas, pursuant to the 24 Texas Rules of Civil Procedure and the provisions 25 stated on the record or attached here.to.

Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0542 Page 2 1 APPEARANCES FOR THE PLAINTIFFS: MS. CHRISTINA GOEBELSMANN 5 MS. SARAR F. POWERS WARGO FRENCH 6 1888 Century Park East, Suite 1520 Los Angeles, California 90067 7 310-853-6807/310-853-6859 (fax) [email protected] 8 [email protected] FOR THE DEFENDANTS: MR. GEOFF GANNAWAY 11 BECK REDDEN 1221 McKinney Street, Suite 4500 12 Houston, Texas 77010 713-951-6263/713-951-3720 (fax) 13 [email protected] ALSO PRESENT: Mr. Manuel Martin, Videographer Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0543 Page 3 1 INDEX PAGE Appearances. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 4 ERNEST PAGE 5 Examination by Ms. Powers . . . . . . . . . . . . . . . . . . . 4 Examination by Mr. Gannaway................. 102 6 Further Examination by Ms. Powers .......... . 112 7 Reporter's Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . 119 8 EXHIBITS 9 NO. DESCRIPTION PAGE/LINE REFERENCED 10 Exhibit 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5/25 First Amended Notice of the Oral and 11 Videotaped Deposition of Ernest Page and Subpoena Duces Tecum Exhibit 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36/8 13 E-mails dated September 15, 2012 14 Exhibit 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56/12 E-mails dated October 20, 2012, with 15 attachment 16 Exhibit 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66/20 E-mails dated September 15, 2012, with 17 attachment Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0544 Page 90 1 Q. And did you ever speak with Mr. Bielss?

2 A. No. He spoke to us. He went up there and 3 gave a little pep talk and how he started, gave us his 4 history and all.

5 Q. Did you personally have any conversations with 6 Mr. Bielss?

7 A. No, ma'am.

8 Q. Okay. Did you meet Tracy Young?

9 A. The name sounds familiar.

10 Q. Do you recall any conversations with Tracy 11 Young?

12 A. Maybe during training, yeah. I mean, just 13 again, there was a lot of them up there talking to us 14 and giving us information and this is what we're going 15 to do today, this is the role-play we're going to do.

16 Other than that 17 Q. Do you recall any specifics conversations you 18 may have had with Tracy Young?

19 A. No, ma 1 am.

20 Q. Did anyone ever tell you about conversations 21 they had with Otto Bielss?

22 MR. GANNAWAY: Object to form.

23 THE WITNESS: Not that I'm aware of.

24 Q. (By Ms. Powers) Did anyone ever tell you 25 about any conversations they had with Tracy Young?

Veri text Florida Reporting Co. 800-726-7007 305-376-8800 0545 Page 1 CAUSE NO. 2013-33584 WELLSHIRE FINANCIAL * IN THE DISTRICT COURT SERVICES, LLC, d/b/a * LONESTAR TITLE LOANS and * INTEGRITY TEXAS FUNDING, * LP, * * Plaintiffs * * VS. * HARRIS COUNTY, TEXAS * TMX FINANCE HOLDINGS, * INC.; TMX FINANCE 1 LLC; * TMX FINANCE OF TEXAS, * INC.; TITLEMAX OF TEXAS, * INC.; FELIX DeLEON; and * ISHMAEL HERNANDEZ, * * Defendants * 152ND JUDICIAL DISTRICT ******************************************************** ORAL AND VIDEOTAPED DEPOSITION OF ARTURO R. GUERRERO JUNE 4, 2014 ******************************************************** ORAL AND VIDEOTAPED DEPOSITION OF ARTURO R. GUERRERO, produced as a witness at the instance of the PLAINTIFFS, and duly sworn, was taken in the above-styled and numbered cause on the 4th of JUNE, 2014 from 2:37 p.m. to 5:47p.m., before MELISSA PARKHILL, CSR, in and for the State of Texas, reported by computer-assisted machine shorthand, at the law offices of Beck Redden, 515 Congress Avenue, Suite 1750, Austin, Travis County,

0546 Page 2 Texas, pursuant to the Texas Rules of Civil Procedure and the provisions stated on the record or attached hereto.

0547 Page 3 1 A P P E A R A N C E S FOR THE PLAINTIFFS: 4 Sarah F. Powers, Attorney at Law -and- 5 Christina Goebelsmann, Attorney at Law WARGO FRENCH 6 1888 Century Park East, Suite 1520 Los Angeles, California 90067 7 (305) 913-8587 [email protected] 8 [email protected] 9 .

FOR THE DEFENDANTS: Bryon Rice, Esq.

12 -and- Geoff Gannaway, Esq.

13 BECK REDDEN, LLP 1221 McKinney, Suite 4500 14 Houston, Texas 77030 (713) 951-6263 15 [email protected] ALSO PRESENT : Jeremy Garrett, Videographer 19 Victoria Newman, Attorney at Law (Present Telephonically)

0548 Page 27 name?

2 A. I don't, to be honest with you. I really don't remember who they were.

4 Q. While you were training in Savannah, did you meet anyone from corporate?

6 A. I did. I met Otto Bielss (pronouncing Bliss) and Tracy Young.

8 Q. And what context did you meet Otto I think, is it, Biells?

10 A. No. It's Otto-- It may be Otto Bielss. Otto -- I thought i t was Otto Bielss (pronouncing Bliss.) I'm not sure.

13 Q. Okay. We'll call him-- we'll call him Otto.

14 A. Mr. Otto. I mean, the first day of our training, they get up, introduce themselves and, you know, welcomed us, you know, to the -- to the training.

17 Q. Okay. And that was both Otto and Tracy Young?

18 A. Yes, ma'am.

19 Q. Did you have any conversations with Otto or Tracy Young?

21 A. Separately, no, ma'am.

22 Q. So other than the occasion that you've described where they got up and introduced themselves, did you have any other contact with Otto or Tracy Young during your training?

0549 Page 28 1 A. During my training, no, ma'am.

2 Q. Did you have any contact with Otto or Tracy Young at any other point?

4 A. I haven't had any contact with Tracy Young.

5 Otto has been to this area -- to the Austin area visiting stores.

7 Q. Okay. And has Otto ever visited your store?

8 A. Yes, ma'am, he visited my store at 8505 Springdale Road.

10 Q. What number is that? 11 A. 23.

12 Q. And when he visited, was anyone else with him?

13 A. It was him, my D.M. at the time, Mike Ryan, our R.M. at the time Oh, what was his name. I can't remember his name. I only met him, like, twice. He was out of Houston. I don' t remember his name. And Linda McDonald was with him.

18 Q. Was the regional manager who was there Darren Lewis?

20 MR. RICE: Object to form.

21 A. I'm not quite sure of his name. I don't remember.

23 Q. It was a man?

24 A. Yeah, i t was man.

25 Q. Could you describe to me what he looks like?

0550 Page 1 CAUSE NO. 2013-33584 WELLSHIRE FINANCIAL * IN THE DISTRICT COURT SERVICES, LLC, d/b/a * LONESTAR TITLE LOANS and * INTEGRITY TEXAS FUNDING, * LP, * * Plaintiffs * * vs. * HARRIS COUNTY, TEXAS * TMX FINANCE HOLDINGS, * INC.; TMX FINANCE, LLC; * TMX FINANCE OF TEXAS, * INC.; TITLEMAX OF TEXAS, * INC.; FELIX DeLEON; and * ISHMAEL HERNANDEZ, * * Defendants * 152ND JUDICIAL DISTRICT ******************************************************** ORAL AND VIDEOTAPED DEPOSITION OF GILBERTO HERNANDEZ JUNE 4, 2014 ******************************************************** ORAL AND VIDEOTAPED DEPOSITION OF GILBERTO HERNANDEZ, produced as a witness at the instance of the PLAINTIFFS, and duly sworn, was taken in the above-styled and numbered cause on the 4th of JUNE, 2014 from 9:04 a.m. to 1:57 p.m., ·before MELISSA PARKHILL, CSR, in and for the State of Texas, reported by computer-assisted machine shorthand, at the law offices of Beck Redden, 515 Congress Avenue, Suite 1750, Austin, Travis County,

0551 Page 2 Texas, pursuant to the Texas Rules of Civil Procedure and the provisions stated on the record or attached hereto.

0552 Page 3 1 A P P E A R A N C E S FOR THE PLAINTIFFS: 4 Sarah F. Powers, Attorney at Law -and- 5 Christina Goebelsmann, Attorney at Law WARGO FRENCH 6 1888 Century Park East, Suite 1520 Los Angeles, California 90067 7 (305) 913-8587 [email protected] 8 [email protected] FOR THE DEFENDANTS: Bryon Rice, Esq.

12 -and- Geoff Gannaway, Esq.

13 BECK REDDEN, LLP 1221 McKinney, Suite 4500 14 Houston, Texas 77030 (713) 951-6263 15 [email protected] ALSO PRESENT: Jeremy Garrett, Videographer 19 Victoria Newman, Attorney at Law (Present Telephonically)

0553 Page 26 yes, a lady.

2 Q. Could one of the trainers been named Jill Johns?

4 A. I don't remember.

5 Q. Could one of the male trainers been named Kevin Hart?

7 A. Don't remember. a Q. Could one of the male trainers have been named Kevin Long?

10 A. Don't remember.

11 Q. Could one of the male trainers have been named Otto Bielss?

13 A. Otto Bielss wasn't a trainer.

14 Q. Who was Otto Bielss?

15 A. He is I think the C.E.O. for part of the company.

17 Q. Was he present for your training while you were there in Savannah in April of 2012?

19 A. He just came in once.

20 Q. And what did he do while he was there at training?

22 A. A short speech for 15 minutes.

23 Q. Did you have the opportunity to speak with him?

24 A. Not one on one.

25 Q. Do you know if anyone had the opportunity to

0554 Page 1 1 NO. 2013-33584 2 WELLSHIRE FINANCIAL ) IN THE DISTRICT COURT SERVICES, LLC, ) 3 d/b/a LOANSTAR TITLE ) LOANS, d/b/a MONEYMAX ) 4 TITLE LOANS, and d/b/a ) LOANMAX; MEADOWWOOD ) 5 FINANCIAL SERVICES, LLC, ) d/b/a LOANSTAR TITLE ) 6 LOANS, and d/b/a MONEYMAX ) TITLE LOANS; and ) HARRIS COUNTY, TEXAS 7 INTEGRITY TEXAS FUNDING, ) LP, ) 8 ) Plaintiffs, ) 9 ) vs. ) 10 ) TMX FINANCE HOLDINGS, ) 11 INC.; TMX FINANCE, LLC; ) 152ND JUDICIAL DISTRICT TMX FINANCE OF TEXAS, ) 12 INC ..; and TITLEMAX OF ) TEXAS, INC., ) 13 ) Defendants. ) * * * * ~ * * * * * * * * * * * 16 VIDEOTAPED ORAL DEPOSITION OF ANTONIO AMADO 17 July 9, 2014 * * * * * * * * * * * * * * * * 20 THE VIDEOTAPED ORAL DEPOSITION of ANTONIO 21 AMADO, produced as a witness at the instance of the 22 Plaintiffs, and duly sworn, was taken in the 23 above-styled and numbered cause on the 9th day of July, 24 2014, from 8:23a.m. to 10:23 a.m., before RACHELLE K.

25 YOUNG, RPR, CRR, Certified Shorthand Reporter in and Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0555 Page 2 1 for the State of Texas, reported by stenographic and 2 computer-aided transcription, in the offices of Kim 3 Tindall & Associates, 645 Lockhill Selma, Suite 200' 4 San Antonio, Texas 78216, pursuant to the Texas Rules 5 of Civil Procedure and the provisions stated on the 6 record or attached hereto.

9 APPEARANCES 10 FOR THE PLAINTIFF (S) : 11 Ms. Sarah F. Powers WARGO & FRENCH 12 1888 Century Park East Suite 1520 13 Los Angeles, California 90067 (310) 913-8587 14 [email protected] FOR THE DEFENDANT(S): Mr. Bryon A. Rice 17 BECK REDDEN, LLP 1221 McKinney Street 18 Suite 4500 Houston, Texas 77010 19 (713) 951-3700 [email protected] 22 ALSO PRESENT: 23 Louis Soucie, Videographer Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0556 Page 3 1 INDEX WITNESS PAGE ANTONIO AMADO Appearances 2 4 Examination by Ms. Powers 5 Examination by Mr. Rice 72 5 Further Examination by Ms. Powers 91 Reporter's Certification 95 9 EXHIBITS 10 Deposition Exhibits Description Page Exhibit 1 Subpoena Duces Tecum 6 Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0557 Page 46 1 remembered.

2 Q. Did you ever receive any communication from 3 Tracy Young regarding marketing or how to market?

4 A. No. That type of correspondence would come 5 from our vice president of operations, Otto Biells, and 6 they were more generalized e-mails. They weren't 7 directives. Those were more communicated through our 8 district and regional managers.

9 Q. When you say "they were more generalized 10 e-mails," what do you mean?

11 A. We needed to increase marketing, the company 12 exposure in certain cities, maximizing, you know, 13 your -- the resources that were made available to us, 14 but not specifics.

15 Q. When you say maximizing resources available to 16 us, what do you mean?

17 A. Using the fliers, we had -- we had a company 18 that would fax us leads, EZ -- EZ Money. EZ Money, I 19 think. EZ Money would fax us a lead and/or -- because 20 we did no cold calling. All of our leads were either 21 walk-ins from marketing tactics that we had utilized 22 and/or leads that we were provided by our headquarters, 23 who had called the BOO number or gone online, and/or 24 EZ Money, or EZ Loan would send us an e-mail followed 25 by a fax, where we would have to call an 888 number Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0558 Page 47 1 with a reference number. An9 once we provided that, 2 they would give us the name, telephone number, year, 3 make, and model of the vehicle, and the loan that they 4 were interested, amount, and we would, in turn, contact 5 that customer and solicit them.

6 Q. And do you know where those leads came from?

7 A. I do not. EZ Loan, EZ Money.

8 Q. Do you -- but do you know where EZ Loan or 9 EZ Money got the leads?

10 A. No, ma'am.

11 Q. Okay. Did you ever discuss marketing or 12 marketing practices with Otto Biells?

13 A. N0 1 ma'am.

14 Q. How many e-mails did you receive from 15 Otto Biells during your time as TitleMax regarding 16 at TitleMax regarding marketing?

17 A. Two, maybe.

18 Q. Do you recall what they said?

19 A. As I had just stated, utilize our marketing.

20 The company had invested a lot of money in our fliers, 21 window sticker decals, to -- you know, of that nature.

22 Q. Do you know a Linda McDonald?

23 A. I do.

24 Q. And who is that?

25 A. She is our former vice president. Linda was Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0559 Page 1 1 NO. 2013-33584 2 WELLSHIRE FINANCIAL SERVICES, * IN THE DISTRICT COURT LLC, d/b/a LOANSTAR TITLE * 3 LOANS and INTEGRITY TEXAS * FUNDING, LP * 4 * VS. * HARRIS COUNTY, TEXAS 5 * TMX FINANCE HOLDINGS, INC.; * 6 TMX FINANCE, LLC; TMX FINANCE * OF TEXAS, INC.; TITLEMAX OF * 7 TEXAS, INC.; FELIX DELEON; * AND ISHMAEL HERNANDEZ * 152ND JUDICIAL DISTRICT 10 ******************************************* 11 ORAL AND VIDEOTAPED DEPOSITION OF 12 JAMES ARTHUR GRIFFIN 13 MAY 23, 2014 14 VOLUME 1 15 ******************************************* 16 ORAL AND VIDEOTAPED DEPOSITION OF JAMES 17 ARTHUR GRIFFIN, produced as a witness at the instance 18 of the Plaintiffs and duly sworn, was taken in the 19 above-styled and numbered cause on the 23rd day of May, 20 2014, from 9:08a.m. to 2:09p.m., before Marsha Evans, 21 Certified Shorthand Reporter in and for the State of 22 Texas, reported by machine shorthand, at 600 Congress 23 Avenue, 20th Floor, Austin, Texas, pursuant to the 24 Texas Rules of Civil Procedure and the provisions 25 stated on the record or attached hereto.

Veritext Florida Repmiing Co. 800-726-7007 305-376-8800 0560 Page 2 1 APPEARANCES FOR THE PLAINTIFFS: MS. CHRISTINA GOEBELSMANN 5 MS. SARAH F. POWERS WARGO FRENCH 6 1888 Century Park East, Suite 1520 Los Angeles, California 90067 7 310-853-6807/310-853-6859 (fax) cgoebelsmann®wargofrench.com 8 [email protected] FOR THE DEFENDANTS: MR. GEOFF GANNAWAY 11 BECK REDDEN 1221 McKinney Street, Suite 4500 12 Houston, Texas 77010 713-951-6263/713-951-3720 (fax) 13 ggannaway®beckredden.com 14 --and-- 15 MS. VICTORIA NEWMAN (Via Telephone) TMX FINANCE 16 15 Bull Street, Suite 200 Savannah, Georgia 31401 17 912-503-2824/912-629-1538 (fax) victoria.newman®titlemax.biz 19 ALSO PRESENT: 20 Mr. Manuel Martin, Videographer Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0561 Page 3 1 INDEX PAGE Appearances. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 4 JAMES ARTHUR GRIFFIN 5 Examination by Ms. Goebelsmann . . . . . . . . . . . . . . 6 Examination by Mr. Gannaway . . . . . . . . . . . . . . . . . 190 6 Further Examination by Ms. Goebelsmann ..... . 214 Further Examination by Mr. Gannaway ........ . 217 7 Further Examination by Ms. Goebelsmann ..... . 217 8 Changes and Corrections . . . . . . . . . . . . . . . . . . . . . . . . . 219 9 Signature . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 220 10 Reporter's Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . 221 12 EXHIBITS 14 NO. DESCRIPTION PAGE/LINE REFERENCED Exhibit 1........................................ 7/2 16 Notice of the Oral and Videotaped Deposition of James A. Griffin and Subpoena 17 Duces Tecum 18 Exhibit 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56/9 Lists of names with loans Exhibit 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99/9 20 E-mails dated September 15, 2012, with attachment Exhibit 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 133/22 22 E-mails dated November 27, 2012 23 Exhibit 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 145/5 E-mails dated October 20, 2012, with 24 attachments Veritext Florida Repotting Co. 800-726-7007 305-376-8800 0562 Page 172 1 A. Correct.

2 Q. What about the regional manager?

3 A. The regional manager occasionally, but most of 4 your conversations were had with your DM.

5 Q. Would corporate discuss your marketing 6 practices with you?

7 MR. GANNAWAY: Object to form.

8 THE WITNESS: When you say "corporate," 9 I'm thinking corporate office, and in that case no. 10 Linda or your regional manager would occasionally have 11 a conversation with you, but again, most of it was 12 through your district manager.

13 Q. (By Ms. Goebelsmann) When you're thinking of 14 corporate office, who are you thinking of?

15 A. Leadership team at the Savannah, Georgia, 16 office.

17 Q. What are the names of the people on that team?

18 A. Gosh, I can't believe I don't remember their 19 names. Otto, 0-t-t-o, Bielss, I think, B-i-e-1-s.

20 That's the only one that stands out. And I'm going to 21 sound like I'm making fun of this. The only reason it 22 stands out is because it's like automobile and we were 23 doing title loans. That's the only reason it stands 24 out.

25 Q. Do you remember how many other people were Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0563 Page 173 1 part of the leadership team?

2 A. No. Obviously -- Tracy Young I think is the 3 owner of the company, and then he had his team that 4 reported to him, but I don't remember how many people 5 were on that team.

6 Q. Did they have any conversations with you 7 regarding your marketing practices?

8 A. I met Otto once in the -- maybe twice. I met 9 him once for sure in the Arlington store, maybe once at 10 the Austin 5 store. Both times the stores were doing 11 really well, so it was more of a, "well, tell me how 12 you're doing it" type thing, not so much a "how can you 13 get better" type thing.

14 Q. What do you mean "tell me how you're doing 15 it"?

16 MR. GANNAWAY: Object to form.

17 THE WITNESS: The sales were good, so he 18 just wanted to know what we were doing marketingwise to 19 get the sales to where they were.

20 Q. (By Ms. Goebelsmann) Do you know why he asked 21 you what you were doing?

22 MR. GANNAWAY: Same objection.

23 THE WITNESS: I don't know specifically.

24 I have my beliefs, but I don't know specifically.

25 Q. (By Ms. Goebelsmann) What's your belief?

Veri text Florida Reporting Co. 800-726-7007 305-376-8800 0564 Page 174 1 MR. GANNAWAY: Object to form.

2 THE WITNESS: All stores were not 3 performing well, so the belief was that if it's working 4 at this store, then we should just transplant or 5 transpose those practices to this store and this store 6 will do the same thing.

7 Q. (By Ms. Goebelsmann) Did you mention 8 PublicData to him?

9 A. No. 10 Q. Do you know if anyone else did?

11 MR. GANNAWAY: Object to form.

12 THE WITNESS: I don't know.

13 MR. GANNAWAY: I'm sorry. Could you 14 repeat your answer?

15 THE WITNESS: I don't know.

16 Q. (By Ms. Goebelsmann) Who else were part of 17 those conversations with Otto?

18 A. Gary Jackson would have been part of the 19 conversations in Arlington. Annette would have been 20 part of the conversations in Austin.

21 Q. So were there two separate times that you 22 spoke with Otto?

23 A. Yes.

24 Q. When were those times?

25 A. The one in Arlington would have been November Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0565 Page 175 1 or December of 2011. The one in Austin 5 would have 2 been, gosh, January, February of 2012.

3 Q. Did you explain to Otto what you were doing to 4 attract new customers?

5 A. They were very generic answers, but yes. We 6 talked about how great we were at marketing, the B-to-B 7 marketing, and how many fliers we put out. Just really 8 generic answers and -- 9 Q. Can you describe to us what your generic 10 answer was?

11 A. We concentrate on fliers, and we put out X 12 number of fliers per day, per week, per month. We've 13 got several auto repair shops that we work with, and 14 A-1 Transmission sends me a couple customers a month.

15 Just real generic answers. Just answers that fall in 16 line with what TitleMax has said is already the proven 17 method for marketing.

18 Q. And what was the proven method?

19 A. Just kind of that three-pronged attack that we 20 had talked about earlier.

21 Q. Did you mention to him that you were sending 22 fliers or letters directly to prospective customers?

23 A. No. At the time in in Arlington that was 24 not a practice at that store or that general manager 25 was using, so it didn't come up in our conversations.

Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0566 Page 176 1 Q. What about for Austin 5?

2 A. I don't know that that was brought up then. I 3 don't believe it was because we didn't start using the 4 PublicData immediately right off the bat in Austin 5.

5 Q. Why did Harold and Gary visit Austin 5 in the 6 beginning of 2012?

7 MR. GANNAWAY: Object to form.

8 THE WITNESS: We were a new market, so 9 there were only two stores in Austin. Austin was 10 projected to be a really high-performing market. Lack 11 of tenure, so when you have new managers, new market, 12 you're going to pay extra attention to it.

13 Q. (By Ms. Goebelsmann) Do you know how long 14 Harold worked with TitleMax?

15 A. I don't know for sure.

16 Q. What about Gary?

17 A. Gary had worked for the company a year, year 18 and a half.

19 Q. From early 2012?

20 A. Early 2012, yes.

21 Q. Did anyone ever tell you to stop sending out 22 the buyout letters or the fliers that you were sending 23 directly to customers?

24 A. We were told to stop sending out our in-store 25 or in-house-created fliers, yes.

Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0567 Page 1 CAUSE NO. 2013-33584 WELLSHIRE FINANCIAL * IN THE DISTRICT COURT SERVICES, LLC, d/b/a * LONESTAR TITLE LOANS and * INTEGRITY TEXAS FUNDING, * LP, * * Plaintiffs * * vs. * HARRIS COUNTY, TEXAS * TMX FINANCE HOLDINGS, * INC.; TMX FINANCE, LLC; * TMX FINANCE OF TEXAS, * INC.; TITLEMAX OF TEXAS, * INC.; FELIX DeLEON; and * ISHMAEL HERNANDEZ, * * Defendants * 152ND JUDICIAL DISTRICT ******************************************************** ORAL AND VIDEOTAPED DEPOSITION OF THOMAS B. KIRK JUNE 5, 2014 ******************************************************** ORAL AND VIDEOTAPED DEPOSITION OF THOMAS B. KIRK, produced as a witness at the instance of the PLAINTIFFS, and duly sworn, was taken in the above-styled and numbered cause on the 5th of JUNE, 2014 from 9:10 a.m. to 12:29 p.m., before MELISSA PARKHILL, CSR, in and for the State of Texas, reported by computer-assisted machine shorthand, at the law offices of Beck Redden, 515 Congress Avenue, Suite 1750, Austin, Travis County,

0568 Page 2 Texas, pursuant to the Texas Rules of Civil Procedure and the provisions stated on the record or attached hereto.

0569 Page 3 1 A P P E A R A N C E S FOR THE PLAINTIFFS: 4 Sarah F. Powers, Attorney at Law -and- 5 Christina Goebelsmann, Attorney at Law WARGO FRENCH 6 1888 Century Park East, Suite 1520 Los Angeles, California 90067 7 (305) 913-8587 [email protected] 8 [email protected] FOR THE DEFENDANTS: Bryon Rice, Esq.

12 (Not Present) -and- 13 Geoff Gannaway, Esq.

BECK REDDEN, LLP 14 1221 McKinney, Suite 4500 Houston, Texas 77030 15 (713) 951-6263 [email protected] ALSO PRESENT: 19 Jeremy Garrett, Videographer Victoria Newman, Attorney at Law 20 (Present Electronically)

0570 Page 137 binder that was someone other than the general manager or the store managers who were in Austin 2?

3 A. Yes.

4 MR. GANNAWAY: Object to form.

5 A. Well, yes.

6 Q. And who would review the binder?

7 A. Mike Ryan.

8 Q. And what was the purpose of Mike Ryan's review of the binder?

10 MR. GANNAWAY: Object to form.

11 A. During monthly audits at our store, i t was part of his job.

13 Q. And what are the monthly audits?

14 A. Just seeing how we were doing, making sure our folders were correct, making sure that, you know, we were doing our normal business properly.

17 Q. Did anyone else at TitleMax perform audits of the marketing binder?

19 A. To my knowledge, no. 20 Q. Did Jim Batterson ever review the marketing binder?

22 MR. GANNAWAY: Object to form.

23 A. To my knowledge, no. 24 Q. Did you ever receive any visits from anyone in corporate while you were at Austin 2?

0571 Page 138 1 A. Yes.

2 Q. Who did you receive visits from?

3 A. Linda and Otto.

4 Q. And who is Linda?

5 A. I don't know her title.

6 Q. Do you remember is i t Linda McDonald?

7 A. I believe so. 8 Q. And Otto, do you remember his last name?

9 A. I do not.

10 Q. Does Otto Bielss sound correct to you?

11 A. I don't remember his last name.

12 Q. Do you remember his title?

13 A. No. 14 Q. And when did Linda and Otto visit you?

15 A. I want to say early '13.

16 Q. And they visited you in Austin 2 at the same time?

18 A. Yes.

19 Q. And who was present for that visit?

20 A. Myself, Lucia and Mike Ryan was with them when they visited.

22 Q. And what happened during that visit?

23 A. They walked in and introduced themselves and asked how we were doing as far as numbers, and then they left.

0572 Page 139 1 Q. Did they review the marketing binder?

2 A. No. 3 Q. Did they review any sort of documents that you had in Austin 2?

5 A. No. 6 Q. Did they do anything else?

7 A. No. 8 Q. Was that the first time that you had met Linda?

9 A. Yes.

10 Q. And what about Otto, had you met him previously?

12 A. No. 13 Q. Did you have any other binders in Austin 2 where you maintained documents related to the operations of the store?

16 A. There's a deposit binder. There was a binder that showed monthly results.

18 Q. Monthly results of what?

19 A. How we did last month dollar wise, reviews, such as that.

21 Q. Would that be called a performance binder?

22 A. Yes; yes. Sorry.

23 Q. Were there any other binders that you maintained that documented the operations in Austin 2?

25 A. No.

0573 From: Karen Prouty Conklin <[email protected]> Sent: Monday, June 23, 2014 8:36. AM To: [email protected]; [email protected]; Johnson, Daniel; Lemus, Robert; Wargo, Joseph D.; Powers, Sarah; Goebelsmann, Christina; Romero, Abigail Stecker; Castaneda, Elizabeth; [email protected] Cc: Steve LaBriola; Geoff Gannaway; Gail Fuller; Sonia Saum; Byron Rice; Christina Baugh Subject: Wellshire Financial SeNices, LLC et al. v. TMX Finance Holdings, Inc. et al.

Follow Up Flag: Follow up Flag Status: Completed

Dear Ms. Piccolo: Per the agreement among counsel, counsel for Defendants designates the following page and line numbers of Linda McDonald's deposition as Attorneys' Eyes Only ("AEO"): Pg. 35, Ln. 14 to Pg. 40, Ln. 12 Pg. 40, Ln. 23 to Pg. 41, Ln. 8 Pg. 41, Lns. 16-19 Pg. 46, Ln. 25 to Pg. 47, Ln. 17 Pg. 53, Ln. 19 to Pg. 56, Ln. 3 Pg. 56, Lns. 14-22 Pg. 58, Ln. 20 to Pg. 59, Ln. 3 Pg. 81, Ln. 15 Pg. 85, Lns. 4-5 Pg. 86, Lns. 8-9 Pg. 87, Lns. 1-4 Pg. 90, Ln. 18 to Pg. 92, Ln. 3 Pg. 93, Ln. 19 to Pg. 94, Ln. 17 Pg. 96, Ln. 2 to Pg. 99, Ln. 6 Pg. 101, Ln. 7 to Pg. 102, Ln. 9 Pg. I 02, Ln. 22 to Pg. I 03, Ln. 3 Pg. I 03, Ln. 9 to Pg. I 07, Ln. 17 Pg. 113, Ln. I to Pg. 114, Ln. 18 Pg. 115, Lns. 7-19 Pg. 116, Lns. 1-25 Pg. 117, Ln. 24 to Pg. 118, Ln. I 0 Pg. 128, Lns. 2-9 Pg. 129, Lns. 4-13 Please confirm receipt of this email by reply, and please let us know ifyou have any questions.

Sincerely, LABRIOlA , Karen Prouty Conklin, RP 0574 Paralegal FELLOWS LABRIOLA LLP Peachtree Center! Suite 2300 South Tower Peachtree Street, NE ! Atlanta, GA 30303 404.586.9200 [main] 404.586.2039 [direct dial] 404.586.9201 [fax] \Yww. !1::1\ab.com

CONFIDENTIAL MEMORANDUM The infOrmation contained in this transmission is privileged and confidential information intended fat the use of the recipient(s) named above. If you are not an intended recipient, you are hereby notified that any review, disclosure, dissemination, distribution, or duplication of this communication is strictly prohibited. If you are not the intended recipient, please contact the sender by reply email and destroy all copies of the original message.

0575 Tab R Page 1.

1 IN THE DISTRICT COURT OF HARRIS COUNTY, TEXAS 2 152ND JUDICIAL DISTRICT

5 WELLSHIRE FINANCIAL SERVICES, 6 LLC, d/b/a LOANSTAR TITLE 7 LOANS, et al., No. 2013-33584 8 Plaintiffs, 9 vs. 10 TMX FINANCE HOLDINGS, INC., 11 et al., 12 Defendants.

16 VIDEOTAPED DEPOSITION OF JAMES BATTERSON 17 Los Angeles, California 18 Tuesday, July 29, 2014 19 Volume I 21 Reported by: 22 JUDITH A. MANGO 23 CSR No. 5584 24 Job No. 1902035 25 PAGES 1 - 247 Veri text Florida Reporting Co. 800-726-7007 305-376-8800 0576 Page 2 1 IN THE DISTRICT COURT OF HARRIS COUNTY, TEXAS 2 152ND JUDICIAL DISTRICT

5 WELLSHIRE FINANCIAL SERVICES, 6 LLC, d/b/a LOANSTAR TITLE 7 LOANS, et al., No. 2013-33584 8 Plaintiffs, 9 vs. 10 TMX FINANCE HOLDINGS, INC., 11 et al., 12 Defendants.

17 Videotaped Deposition of JAMES BATTERSON, 18 Volume I, taken on behalf of defendants, at 400 19 South Hope Street, Los Angeles, Calif'ornia, 20 beginning at 10:08 a.m. and ending at 12:45 p.m. on 21 Tuesday, July 29, 2014, before JUDITH A. MANGO, 22 Certified Shorthand Reporter No. 5584.

Veritext Florida Repotiing Co. 800-726-7007 305-376-8800 0577 Page 3 1 APPEARANCES: 3 For Plaintiffs: 4 WARGO & FRENCH LLP 5 BY: SARAH F. POWERS 6 CHRISTINA L. GOEBELSMANN 7 Attorneys at Law 8 1888 Century Park East, Suite 1520 9 Los Angeles, California 90067 10 (310) 853-6800 11 [email protected] 12 [email protected] 14 For Defendants TMX Finance, LLC; TMX Finance of 15 Texas, Inc. and TitleMax of Texas, Inc.: 16 FELLOWS LA BRIOLA LLP 17 BY: STEPHEN T. LA BRIOLA 18 Attorney at Law 19 Peachtree Center 20 225 Peachtree Street, N.E. 21 Suite 2300, South Tower 22 Atlanta, Georgia 30303-1731 23 (404) 586-9200 24 slabriola®fellab.com

Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0578 Page 4 1 APPEARANCES (CONTINUED) : 3 For the Witness: 4 HOLLAND & KNIGHT LLP 5 BY: SHELLEY G. HURWITZ 6 Attorney at Law 7 400 South Hope Street, 8th Floor 8 Los Angeles, California 90071 9 (213) 896-2400 10 [email protected] 12 Also Present: 13 VICTORIA NEWMAN (VIA TELEPHONE) 14 GILBERT MIRANDA, VIDEOGRAPHER

Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0579 Page 52 1 A On the advice of counsel and pursuant to my 2 rights under the Fifth Amendment of the United 3 States and California Constitution, I respectfully 4 decline to answer that question on the grounds that 5 my answer may tend to incriminate me. 10:30:54 6 Q Did you have any conversations with Otto 7 Bielss, the vice-president of operations, during the 8 time that you were employed as a regional manager?

9 A On the advice of counsel and pursuant to my 10 rights under the Fifth Amendment of the United 10:31:03 11 States and California Constitution, I respectfully 12 decline to answer that question on the grounds that 13 my answer may tend to incriminate me. 14 Q Did you have any conversations with Charles 15 Cole during the time that you were employed as a 10:31:08 16 regional manager in Texas?

17 A On the advice of counsel and pursuant to my 18 rights under the Fifth Amendment of the United 19 States and California Constitution, I respectfully 20 decline to answer that question on the grounds that 10:31:12 21 my answer may tend to incriminate me. 22 Q And what did you discuss with Mr. Biells or 23 Mr. Cole?

24 A On the advice of counsel and pursuant to my 25 rights under the Fifth Amendment of the United 10:31:16 Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0580 Page 68 1 A On the advice of counsel and pursuant to my 2 rights under the Fifth Amendment of the United 3 States and California Constitution, I respectfully 4 decline to answer that question on the grounds that 5 my answer may tend to incriminate me. 10:37:08 6 Q Did you have conversations with Linda 7 McDonald regarding marketing practices in your 8 region?

9 A On the advice of counsel and pursuant to my 10 rights under the Fifth Amendment of the United 10:37:13 11 States and California Constitution, I respectfully 12 decline to answer that question on the grounds that 13 my answer may tend to incriminate me. 14 Q Did you have conversations with Otto Bielss 15 regarding marketing practices in your region? 10:37:17 16 A On the advice of counsel and pursuant to my 17 rights under the Fifth Amendment of the United 18 States and California Constitution, I respectfully 19 decline to answer that question on the grounds that 20 my answer may tend to incriminate me. 10:37:20 21 Q What were the purposes of any conversations 22 that you had with Mike Ryan with respect to 23 marketing practices in your region?

24 A On the advice of counsel and pursuant to my 25 rights under the Fifth Amendment of the United 10:37:28 Veri text Florida Reporting Co. 800-726-7007 305-376-8800 0581 Page 72 1 decline to answer that question on the grounds that 2 my answer may tend to incriminate me. 3 Q How many times did you speak with Otto 4 Bielss regarding marketing practices in your region?

5 A On the advice of counsel and pursuant to my 10:38:40 6 rights under the Fifth Amendment of the United 7 States and California Constitution, I respectfully 8 decline to answer that question on the grounds that 9 my answer may tend to incriminate me. 10 Q When did you have conversations with Otto 10:38:40 11 Bielss regarding marketing practices in your region?

12 A On the advice of counsel and pursuant to my 13 rights under the Fifth Amendment of the United 14 States and California Constitution, I respectfully 15 decline to answer that question on the grounds that 10:38:46 16 my answer may tend to incriminate me. 17 Q Did you have any discussions with Otto 18 Bielss regarding the propriety of any marketing 19 techniques or practices used in your region?

20 A On the advice of counsel and pursuant to my 10:38:55 21 rights under the Fifth Amendment of the United 22 States and California Constitution, I respectfully 23 decline to answer that question on the grounds that 24 my answer may tend to incriminate me. 25 Q And when did you have that conversation 10:38:56 Veri text Florida Repmiing Co. 800-726-7007 305-376-8800 0582 Page 73 1 with Otto Bielss?

2 A On the advice of counsel and pursuant to my 3 rights under the Fifth Amendment of the United 4 States and California Constitution, I respectfully 5 decline to answer that question on the grounds that 10:38:59 6 my answer may tend to incriminate me. 7 Q When you were regional manager, did your 8 district manager send you marketing plans for you to 9 review?

10 A On the advice of counsel and pursuant to my 10:39:08 11 rights under the Fifth Amendment of the United 12 States and California Constitution, I respectfully 13 decline to answer that question on the grounds that 14 my answer may tend to incriminate me. 15 Q Who sent you those marketing plans? 10:39:08 16 A On the advice of counsel and pursuant to my 17 rights under the Fifth Amendment of the United 18 States and California Constitution, I respectfully 19 decline to answer that question on the grounds that 20 my answer may tend to incriminate me. 10:39:12 21 Q Did Mike Ryan send you marketing plans?

22 A On the advice of counsel and pursuant to my 23 rights under the Fifth Amendment of the United 24 States and California Constitution, I respectfully 25 decline to answer that question on the grounds that 10:39:15 Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0583 Page 123 1 A On the advice of counsel and pursuant to my 2 rights under the Fifth Amendment of the United 3 States and California Constitution, I respectfully 4 decline to answer that question on the grounds that 5 my answer may tend to incriminate me. 11:14:01 6 Q How many individuals were involved in going 7 to parking lots of LoanStar to record the license 8 plate numbers of the cars parked in LoanStar parking 9 lots?

10 A On the advice of counsel and pursuant to my 11:14:12 11 rights under the Fifth Amendment of the United 12 States and California Constitution, I respectfully 13 decline to answer that question on the grounds that 14 my answer may tend to incriminate me. 15 Q Did you ever go to the parking lots of any 11:14:13 16 competitors of TitleMax to solicit the customers of 17 those competitors?

18 A On the advice of counsel and pursuant to my 19 rights under the Fifth Amendment of the United 20 States and California Constitution, I respectfully 11:14:22 21 decline to answer that question on the grounds that 22 my answer may tend to incriminate me. 23 Q How many times did you go to the parking 24 lots of competitors to solicit the customers of 25 those competitors? 11:14:29 Veri text Florida Reporting Co. 800-726-7007 305-376-8800 0584 Page 124 1 A On the advice of counsel and pursuant to my 2 rights under the Fifth Amendment of the United 3 States and California Constitution, I respectfully 4 decline to answer that question on the grounds that 5 my answer may tend to incriminate me. 11:14:30 6 Q Which competitors did you go to in order to 7 solicit the business of competitors from the 8 competitors' parking lots?

9 A On the advice of counsel and pursuant to my 10 rights under the Fifth Amendment of the United 11:14:38 11 States and California Constitution, I respectfully 12 decline to answer that question on the grounds that 13 my answer may tend to incriminate me. 14 Q How many customers did you record license 15 plate information when you went to the -- strike 11:14:46 16 that.

17 Did you ever go to the parking lots of 18 competitors to record the license plate numbers of 19 cars parked in those parking lots?

20 A On the advice of counsel and pursuant to my 11:14:57 21 rights under the Fifth Amendment of the United 22 States and California Constitution, I respectfully 23 decline to answer that question on the grounds that 24 my answer may tend to incriminate me. 25 Q And which competitors' parking lots did you 11:14:58 Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0585 Page 148 1 use in the direct mailer program?

2 A On the advice of counsel and pursuant to my 3 rights under the Fifth Amendment of the United 4 States and California Constitution, I respectfully 5 decline to answer that question on the grounds that 11:26:42 6 my answer may tend to incriminate me. 7 Q Who created the new marketing materials?

8 A On the advice of counsel and pursuant to my 9 rights under the Fifth Amendment of the United 10 States and California Constitution, I respectfully 11:26:47 11 decline to answer that question on the grounds that 12 my answer may tend to incriminate me. 13 Q Who approved the new marketing materials?

14 A On the advice of counsel and pursuant to my 15 rights under the Fifth Amendment of the United 11:26:50 16 States and California Constitution, I respectfully 17 decline to answer that question on the grounds that 18 my answer may tend to incriminate me. 19 Q Did you create the new marketing materials 20 used as part of the direct mailer program? 11:26:53 21 A On the advice of counsel and pursuant to my 22 rights under the Fifth Amendment of the United 23 States and California Constitution, I respectfully 24 decline to answer that question on the grounds that 25 my answer may tend to incriminate me. 11:26:57 Veritext Florida Repotiing Co. 800-726-7007 305-376-8800 0586 Page 181 1 decline to answer that question on the grounds that 2 my answer may tend to incriminate me. 3 Q Did you use the search results that you 4 obtained from DataTrax to solicit customers of 5 competitors? 11:43:07 6 A On the advice of counsel and pursuant to my 7 rights under the Fifth Amendment of the United 8 States and California Constitution, I respectfully 9 decline to answer that question on the grounds that 10 my answer may tend to incriminate me. 11:43:08 11 Q Did you ever search DataTrax or PublicData 12 for information related to liens held by 13 competitors?

14 A On the advice of counsel and pursuant to my 15 rights under the Fifth Amendment of the United 11:43:18 16 States and California Constitution, I respectfully 17 decline to answer that question on the grounds that 18 my answer may tend to incriminate me. 19 Q Did you ever search DataTrax or PublicData 20 for information related to liens held by LoanStar? 11:43:24 21 A On the advice of counsel and pursuant to my 22 rights under the Fifth Amendment of the United 23 States and California Constitution, I respectfully 24 decline to answer that question on the grounds that 25 my answer may tend to incriminate me. 11:43:27 Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0587 Page 202 1 decline to answer that question on the grounds that 2 my answer may tend to incriminate me. 3 Q Were those employees district managers in 4 Houston, Texas?

5 A On the advice of counsel and pursuant to my 11:51:37 6 rights under the Fifth Amendment of the United 7 States and California Constitution, I respectfully 8 decline to answer that question on the grounds that 9 my answer may tend to incriminate me. 10 Q Were those employees district managers in 11:51:38 11 Dallas, Texas?

12 A On the advice of counsel and pursuant to my 13 rights under the Fifth Amendment of the United 14 States and C~lifornia Constitution, I respectfully 15 decline to answer that question on the grounds that 11:51:43 16 my answer may tend to incriminate me. 17 Q Were those employees district managers in 18 El Paso?

19 A On the advice of counsel and pursuant to my 20 rights under the Fifth Amendment of the United 11:51:49 21 States and California Constitution, I respectfully 22 decline to answer that question on the grounds that 23 my answer may tend to incriminate me. 24 Q Were those employees district managers in 25 Waco? 11:51:55 Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0588 Page 238 1 BY MR. LA BRIOLA: 2 Q Indeed, such activity would violate company 3 policy, correct?

4 A On the advice of counsel and pursuant to my 5 rights under the Fifth Amendment of the United 12:41:10 6 States and California Constitution, I respectfully 7 decline to answer that question on the grounds that 8 my answer may tend to incriminate me. 9 Q Isn't it true that you told Linda McDonald 10 that you did exactly as she had instructed and that 12:41:15 11 you were not aware of any TitleMax employee in your 12 region who was doing what Linda McDonald told you 13 LoanStar was alleging?

14 MS. GOEBELSMANN: Object to form.

15 THE WITNESS: On the advice of counsel and 12:41:28 16 pursuant to my rights under the Fifth Amendment of 17 the United States and California Constitution, I 18 respectfully decline to answer that question on the 19 grounds that my answer may tend to incriminate me. 20 BY MR. LA BRIOLA: 12:41:30 21 Q Isn't it true that you told Linda McDonald 22 that you do not know of any TitleMax employee who 23 was writing down license plate numbers from 24 competitor parking lots and soliciting them for 25 business? 12:41:41 Veritext Florida Repotting Co. 800-726-7007 305-376-8800 0589 From: Karen Prouty Conklin <[email protected]> Sent: Tuesday, September 02, 2014 11:14 AM To: [email protected]; [email protected]; Johnson, Daniel; Lemus, Robert; Wargo, Joseph D.; Powers, Sarah; Goebelsmann, Christina; Stecker, Abigail; Castaneda, Elizabeth; [email protected] Cc: Steve LaBriola; Geoff Gannaway; Gail Fuller; Sonia Saum; Byron Rice; Christina Baugh; Angela Torres Subject: Wellshire Financial Services, LLC et al. v. TMX Finance Holdings, Inc. et al.

Dear Ms. Piccolo: Per the agreement among counsel, counsel for Defendants designate Page 77, line 21 through Page 103, line 13 of James Batterson's deposition as Attorneys' Eyes Only.

Please confirm receipt of this email by reply, and please let us know if you have any questions.

Sincerely, LABRlQJJ.A" Karen Prouty Conklin, RP Paralegal FELLOWS LABRIOLA LLP Peachtree Center I Suite 2300 South Tower Peachtre·c Street, NE I Atlanta, GA 30303 404.586.9200 [main] 404.586.2039 [direct dial] 404.586.9201 [fax] W\\w.IC\Iab.com

CONFIDENTIAL MEMORANDUM The information contained in this transmission is privileged and c.onfidential information intended for the use of the recipient(s) named above. If you are not an intended recipient, you are hereby notified that any review, disclosure, dissemination, distribution, or duplication of this communication is strictly prohibited. If you are not the intended recipient, please contact the sender by reply email and destroy all copies of the original message.

0590 Tab S CAUSE NO. 2013-33584 WELLSHIRE FINANCIAL SERVICES, LLC, § IN THE DISTRICT COURT d!b/a LOANSTAR TITLE LOANS, d/b/a § MONEYMAX TITLE LOANS, and d/b/a § LOANMAX; MEADOWWOOD FINANCIAL § SERVICES, LLC, d/b/a LOANSTAR TITLE § LOANS, and d/b/a MONEYMAX TITLE § LOANS; and INTEGRITY TEXAS § FUNDING, LP, § § PlaintlfjS, § OF HARRIS COUNTY, TEXAS § v. § § TMX FINANCE HOLDINGS, INC.; § TMX FINANCE, LLC; § TMX FINANCE OF TEXAS, INC.; and § TITLEMAX OF TEXAS, INC., § § Defendants. § 15211 d JUDICIAL DISTRICT PLAINTIFFS' OMNIBUS RESPONSE TO DEFENDANTS' MOTIONS FOR PROTECTIVE ORDER, DISCOVERY LIMITS, TO COMPEL DISCLOSURE OF DAMAGES CALCULATIONS, AND MEDIATION COME NOW, Plaintiffs Wellshire Financial Services, LLC d/b/a LoanStar Title Loans, d!b/a Money Max Title Loans, and d/b/a LoanMax; Meadowwood Financial Services, LLC, d/b/a LoanStar Title Loans, and d/b/a MoneyMax Title Loans; and Integrity Texas Funding, LP, (collectively, "LoanStar") and hereby file this omnibus response to the discovery motions ("Omnibus Motion") filed by Defendants TMX Finance, LLC, TMX Finance of Texas, Inc. and TitleMax of Texas, Inc. (collectively, "TitleMax"), and respectfully show the Court as follows: I. INTRODUCTION TitleMax's Omnibus Motion should be rejected, as it is an attempt to prematurely and improperly curtail discovery before LoanStar has an opportunity to discover the tme scope of TitleMax's misconduct and ascertain the damages caused thereby. Contrary to TitleMax's

0591 unfounded accusations, the amount of discovery taken to date, as well as the discovery that still needs to be completed, is dictated not by "~ambo" tactics on the part of LoanStar, but by the remarkable scope of TitleMax's illegal scheme to purloin Loan Star's customers and TitleMax's refusal to be forthcoming in discovery.

In fact, LoanStar learned just this week (July 14, 2014) - only through a third-party subpoena- that TitleMax's illegal conduct continues to this day, despite the entry of a temporary injunction order ("TIO") prohibiting it. Specifically, records produced by "The Source for PublicData, LP" ("PublicData") documenting searches performed by 20 TitleMax employees shows that at least four of them conducted at least 14 illegal searches directed at LoanStar customers, as recently as May 19, 2014. 1 Loan Star's discovery of these recent illegal searches, only through a third-party subpoena, has been typical of the discovery process in this case, as LoanStar has had to build its case by continuing to dig for the truth, one deposition at a time, because TitleMax refuses to be forthcoming in discovery and continually misrepresents the facts 'to LoanS tar. Indeed, discovery has revealed that the illegal searches at the heart of this case occurred during a period nearly double that represented by TitleMax and that its management was aware of and directed this conduct.

In light of such circumstances, TitleMax's motions and requests for relief are without merit. First, TitleMax's proposed 50 hour deposition limit is actually an attempt to entirely shut down the deposition process, as LoanStar is already at that limit. TitleMax would prevent LoanStar from (among other things) deposing employees who continue to conduct illegal searches, as well as taking depositions to establish the extent to which TitleMax's corporate policies or practices dictated the illegal behavior. Second, TitleMax cannot complain that LoanStar has not provided detailed damages calculations when TitleMax has prevented LoanStar T111e and correct, redacted copies of these search results are attached hereto as Exhibit A.

0592 from discovering information relevant to its damages. Third, there is no merit to TitleMax's request for a protective order as to a deposition notice that has never been served and was significantly modified by LoanStar at TitleMax's request. Fourth, TitleMax's demand that the Court order the parties to mediation is obviously premature, as TitleMax has denied LoanStar the information needed to make any mediation productive.

The Court should therefore deny TitleMax's Omnibus Motion in its entirety.

II. RELEVANT BACKGROUND The record in this case demonstrates that, from the very outset of this dispute, TitleMax has sought to conceal the vast scope of its illegal scheme to steal LoanStar' s customers. This has required LoanS tar to painstaking] y uncover the truth by continuing to turn over stone after stone, exposing additional evidence of misconduct and additional leads. For example: • In November 2012, more than six months before the filing of this case, TitleMax flatly (and falsely) denied that it was engaging in the illegal searching and marketing . to LoanS tar customers at the heart of this case. 2 Expedited depositions taken at the outset of the case were required to prove the falsity ofTitleMax's representation. 3 • TitleMax later admitted that its employees engaged in illegal searches, but denied that this conduct occutTed prior to June 2012, and thus refused to supplement the Overlap List to provide information prior to that date. LoanStar was forced to take

See December 6, 20 I 2 letter from Yin Thomas (TitleMax in-house counsel) to John McCloskey (LoanStar in-house counsel) filed as Exhibit B to Plaintiffs' Motion to Compel Discovery Responses filed on July 7, 20I4 ("TMX denies the allegations in your letter. Specifically, TMX employees are neither monitoring [Loan Star's] Texas store parking lots for the purposes of obtaining license plate numbers from [LoanStar's] customers through improper searching of lien information in Texas state-maintained motor vehicle records.")

See Deposition Excerpts filed as Exhibit C to Plaintiffs' Motion to Compel Discovery Responses filed on July 7, 2014 [Felix DeLeon Dep. 12:2-8, I4:IO-l5, I5:I3-24; Jarrod Dozier Dep.l9:9-l3, 34:9-25; Lucia Grajeda Dep.l7:8-2; Ismael Hernandez Dep.l2:6-20:9; Joshua Hadden Dep.l5:7-2I :3; Mike Ryan Dep.23: 15-28:9; Patrick Sudduth Dep. 23: I -36:2 I].

0593 depositions to prove that, as well, and then had to file a motion to compel supplementation of the Overlap List. 4 • TitleMax failed to disclose numerous individuals with knowledge that the illegal conduct was ocCUlTing throughout Texas, instead forcing LoanStar to painstakingly uncover such evidence one deposition at a time. Only LoanStar' s efforts in noticing the depositions of individuals and subpoenaing the records of a third party exposed the true facts in this regard. 5 • Given that TitleMax tried to portray its illegal conduct as the acts of a few rogue employees, LoanStar has had to take depositions of former TitleMax employees to prove that TitleMax's management was not only aware of the misconduct, but also actively encouraged or even required it. 6 • In June 2014, PublicData produced over 22,000 pages of searches conducted by 20 TitleMax employees. An analysis of these records, ongoing since the production and completed only on July 14 reveals that at least four TitleMax employees have conducted at least 14 searches directed at LoanStar customers, as recently as May 19, 2014, despite the Com1's TIO prohibiting such conduct. These searches include queries by license plate number and zip code, demonstrating that TitleMax employees

·• See, e.g., Plaintiffs' Reply In Support of Plaintiffs' Discovery Motions filed July 10, 2014 Exhibits B [Miguel Mm1inez Dep. Rough Transcript [July 8, 2014] 14, 33-34, 79], C [James Griffin Dep. 10-12, 86-90], & D [Randy Rainey Dep. Rough Transcript [July 8, 2014]36-44]. ' See, e.g., Depositions Excerpts attached hereto as Exhibit D [Griffin Dep. 10-13, 48-49, 88-89 (James Griffin, Harold Landers, Gary Jackson); Rainey Dep. Rough Transcript [July 8, 2014] 36-37 (Randy Rainey, Tom Griffin); Martinez Dep. Rough Transcript (July 8, 2014] 33-14 (Miguel Martinez, Wanda "Wendy" Payne, "Ray from Euless"); Antonio Amado Dep. Rough Transcript [July 9, 2014] 19, 21 ("Denny" from "N011hwest Military", "Brigitte" from "281 and Blanco")]; see also Exhibit A. ' See, e.g., Exhibit D [Griffin Dep. 101-03, 105-07; Hale Dep. 121-24].

0594 continue to use illegal marketing practices to identifY customers of TitleMax's competitors (including LoanStar). (Exhibit A.)

In short, the record shows that TitleMax has attempted to conceal the scope of its unlawful scheme at virtually every turn, and that LoanStar has been able to uncover the facts of this case only through deposing numerous former TitleMax employees and through third party discovery.

The record is also clear that LoanStar requires further discovery regarding the true extent of TitleMax's unlawful conduct, the source thereof, and the damages caused thereby.

III. ARGUMENT A. TitleMax Cannot Show That Its Discovery Limitations Are Appropriate at This Time In its Omnibus Motion, TitleMax recognizes that, in considering whether to limit discovery, the Court should take into account: (I) the needs of the case; (2) the amount in controversy; (3) the parties' resources; (4) the importance of the issues at stake in the litigation; and (5) the importance of the proposed discovery in resolving the issues. (TEX. R. CJV. P.l92.4.)

Notably, however, TitleMax fails to analyze these factors in its Omnibus Motion, undoubtedly .because all of these factors dictate denial ofTitleMax's attempt to prematurely cm1ail discovery.

First, the record amply demonstrates that the needs of this case have not only required significant discovery to date, but that significant additional discovery is necessary. Such discovery is required to ascertain, among other things, the scope and extent of the misconduct at issue, the extent to which such misconduct reflects corporate policies or practices rather than the actions of a handful of rogue employees, and the damages caused by TitleMax's conduct. The record fm1her shows that the need for such discovery has largely been dictated by TitleMax's own attempts to hide the truth. TitleMax cannot complain about the need for additional discovery when it has sown the seeds of its own dilemma.

0595 Second, the amount in controversy here is significant. Although LoanStar cannot yet calculate damages because TitleMax has refused to provide the discovery necessary for LoanStar to do so, it is readily apparent that LoanStar's damages will be significant. Indeed, TitleMax admits to a potential universe of more than 7,500 stolen customers-a universe that will expand when TitleMax supplements the Overlap List as ordered by the Comt. Given that TitleMax's illegal conduct resulted in the conversion of thousands of customers who otherwise would have provided continuing revenue streams to LoanStar, damages will be substantial.

Third, the parties' resources do not suggest that discovery should be limited. TMX Finance LLC is a behemoth, with over 1200 stores in 22 states, and in 2012 repotted interest and fee income of$656 million. (Exhibit B [TitleMa"< 2012 10-k].)

Fourth, the importance of the issues at stake in the litigation weighs against TitleMax's attempt to severely curtail discovery at this point. This case involves egregious conduct that TitleMax admits was improper (as well as criminal) -conduct that not only allowed TitleMax to steal countless LoanStar customers, but also violated the privacy rights of tens of thousands of individuals. Indeed, discovery to date demonstrates that TitleMax has accessed the personal information for over 10,700 individuals through the database searches-including records of over 1,600 individuals in Texas since the TIO was entered in this case in July 2013.

Finally, there is no question that the fifth factor - the importance of the proposed discovery in resolving the issues- also militates towards denial of TitleMax's Omnibus Motion.

As shown above, it is only through discovery- particularly the depositions of former employees and other third party discovery - that LoanStar has begun to uncover the .truth. TitleMax has resisted that discovery at every turn, and has failed to be forthcoming with the true facts regarding (among other things) the number of employees involved in its illegal scheme and the

0596 extent to which TitleMax's management were both aware of and involved in that scheme. It is only through significant additional discovery that the full extent of such facts will be revealed, and the true nature and amount of LoanS tar's damages can be determined. Accordingly, ill!!!£ of the five factors support TitleMax's attempt to curtail discovery at this time.

Further, as shown below, TitleMax's Omnibus Motion should also be denied because the individual components thereof are without merit.

B. TitleMax Has No Grounds to Seek a Protective Order Regarding a Corporate Deposition Notice That Has Never Been Served and Has Already Been Narrowed TitleMax's motion for protective order as to a corporate deposition notice that has never been served is a red herring. Indeed, TitleMax fails to inform the Court that LoanStar agreed to narrow the notice before TitleMax ever filed its motion. Thus, the draft notice of which TitleMax complains no longer even exists. More than one month ago, LoanStar provided the proposed corporate deposition topics to counsel for TitleMax, requesting deposition dates and inviting discussion on the topics. Counsel for TitleMax delayed in responding for weeks, ultimately refusing to produce any witness for deposition and instead threatening to file the instant motion claiming, without specification, that the noticed topics were too broad. At LoanStar's insistence, a meet and confer was held during which counsel for TitleMax complained of overbreadth as to nearly all of LoanStar's proposed topics. LoanStar thereafter provided a substantially narrowed proposed notice, eliminating more than half of the proposed topics and adding language to narrow several others. (See Meet and Confer Email dated July 2, 2014, attached hereto as Exhibit C.) LoanStar also requested that TitleMax further discuss the topics. Instead, TitleMax filed the instant motion, vaguely referencing a purportedly "overbroad" notice it does not attach, and referencing topics that were already removed or

0597 narrowed by Loan Star. The Court should not enter a protective order regarding a deposition that has never been noticed and about which TitleMax has failed to meaningfully meet and confer.

C. TitleMax's Proposal to Shutdown Deposition Discovery Must Be Rejected TitleMax's proposed 50 hour limit on depositions actually seeks to end deposition discovery, as TitleMax knows that LoanStar is already at that limit. Importantly, however, it is only through deposition testimony that LoanStar has been able to uncover facts demonstrating that TitleMax' s illegal conduct spanned a much longer time frame and involved far more employees than TitleMax ever disclosed, including management level employees. Indeed, every stone LoanStar turns over results in additional evidence and witnesses supporting its claims.

Given LoanStar's success in using depositions of former employees to uncover the truth to date, it is not surprising that TitleMax seeks to end deposition discovery to prevent LoanStar from discovering the full extent of the misconduct and damages at issue here.

The need for further deposition testimony is readily apparent. For example, once corrected, the Overlap List will provide a basis for discovery of the illegal conduct that occtmed during the actual time period at issue. TitleMax will be required to supplement its earlier discovery responses tied to the Overlap List, and to the extent additional employees with knowledge are disclosed, LoanStar is entitled to depose them. Likewise, LoanStar must be allowed to depose the four employees who were exposed by the PublicData records as continuing to conduct unlawful searches for LoanS tar customers. As the history of this case proves, those employees will likely reveal additional witnesses and leads.

Fmiher, TitleMax's own arguments highlight the need for additional deposition discovery regarding its corporate policies and practices with regard to the illegal searches. TitleMax attempts to take the sting out of its illegal scheme by suggesting that one of the websites it used to conduct its illegal searches- PublicData- misled TitleMax's employees into believing they

0598 can search DMV records "[f]or any use in the normal course of business ... " That argument is disingenuous, as the language it highlights is actually a hyperlink which, when clicked on, displays the full text of the exemption- text which clearly prohibits the searches executed by TitleMax. In any event, at the same time TitleMax represents that its employees did not know their searches were illegal, TitleMax seeks to deny LoanStar discovery regarding TitleMax's corporate policies, practices, and training with respect to, among other things, the permissible uses of such databases and whether their use is considered an acceptable marketing practice by TitleMax. It is absurd for TitleMax to make its "innocent user" argument while at the same time attempting to foreclose discovery regarding these issues.

In short, while it is clear why TitleMax wants the Court to end deposition discovery, it is equally clear that the Court should decline to do so at this time.

D. TitleMax Cannot Demand LoanStat·'s Damages Calculations and Mediation While Simultaneously FJ"Ustrating LoanStar's Efforts to Obtain the Information Necessary to Calculate Damages and Participate in Meaningful Mediation TitleMax 's request for LoanS tar's damages calculation is especially ironic, given TitleMax's failure and refusal to provide LoanStar with information necessary to that very calculation. As the Comt knows, TitleMax attempted to mtificially cutoff disclosure of potentially stolen customers, necessitating a motion to compel by LoanStar and ultimately resulting in the Co uti ordering TitleMax to provide additional information to expand the Overlap List. As LoanStar's counsel has repeatedly informed counsel for TitleMax, LoanStar is not in a position to provide a damages calculation until TitleMax produces the information enabling it to do so. Additionally, as pleaded by LoanStar in its Second Amended Petition, LoanStar seeks to recover from TitleMax ill-gotten profits earned as a result ofTitleMax's illegal conduct. In order

0599 to calculate those damages, outside counsel for LoanStar7 must have access to certain TitleMax financial records. TitleMax has categorically refused to provide such information.

Likewise, TitleMax demands mediation, but is unwilling to provide LoanStar with information necessary for such a mediation to be at all meaningful. Indeed, without complete information from which to determine the proper scope of damages, LoanStar would be flying blind and have no basis from which to adequately negotiate. 8 IV. PRAYER Accordingly, LoanStar respectfully requests that this Court deny the relief TitleMax seeks tlu·ough its discovery motions.

DATED: July 16,2014 Respectfully submitted, SUTHERLAND ASBILL & BRENNAN LLP By: Is/ Daniel Johnson Kent C. Sullivan (SBN 19487300) Daniel Johnson (SBN 24046165) Robert A. Lemus (SBN 24052225) 1001 Fannin, Suite 3700 Houston, Texas 77002 Telephone: (713) 470-6100 Facsimile: (713) 654-1301 E-mail: [email protected] E-mail: [email protected] E-mail: [email protected] And WARGO FRENCH LLP Joseph D. Wargo (GA No. 738764) The parties' Rule 11 confidentiality agreement contemplates protection of commercially sensitive information through an "Attorney's Eyes Only" designation, by which even the parties' in-house counsel are prohibited from viewing information so designated.

Notably, despite its purported eagerness to mediate, TitleMax has never once made an effort to commence negotiations or made any settlement offer.

0600 (Admitted Pro Hac Vice) Joseph W. Ozmer II (GA No. 001542) (Admitted Pro Hac Vice) Peachtree Street, N. E., 26 111 Floor Atlanta, Georgia 30309 Telephone: (404) 853-1500 Facsimile: (404) 853-1501 E-Mail: [email protected] E-Mail: [email protected] Sarah F. Powers (CA. No. 238184) (Admitted Pro Hac Vice) Christina L. Goebelsmann (CA No. 273379) (Admitted Pro Hac Vice) 1888 Century ParkE, Suite 1520 Los Angeles, California 90067 Telephone: (31 0) 853-6300 Facsimile: (31 0) 853-6333 E-Mail: [email protected] E-Mail: [email protected] Attorneys for Wei/shire Financial Services, LLC, d/b/a LoanStar Title Loans, d/b/a MoneyMax Title Loans, and d/b/a LoanMax; Meadowwood Financial Services, LLC, d/b/a LoanStar Title Loans, and d/b/a MoneyMax Title Loans; and Integrity Texas Funding, LP

1l 0601 CERTIFICATE OF SERVICE This is to certifY that I have this day served all parties with a copy of the within and foregoing PLAINTIFFS' OMNIBUS RESPONSE TO DEFENDANTS' MOTIONS FOR PROTECTIVE ORDER, DISCOVERY LIMITS, TO COMPEL DISCLOSURE OF DAMAGES CALCULATIONS, AND MEDIATION has been forwarded to all counsel of record in accordance with TEX. R. C!V. P. 21 and 21a on this 16th day of July 2014.

David Beck Geoff Garmaway Bryon Rice BECK REDDEN LLP 1221 McKinney St., Suite 4500 Houston, Texas 770 I 0.

Stephen LaBriola Christina Baugh FELLOWS LABRIOLA LLP Peachtree Center Suite 2300, South Tower Peachtree Street, N.E. Atlanta, Georgia 30303-1731 Allorneys.for TMX Finance LLC, TMX Finance of Texas, Inc. and TitleMax of Texas, Inc.

DATED: July 16,2014 Is/ Daniel Johnson Daniel Johnson

0602 EXHIBIT A

0603 Date User Name Type of Search Search (Term) Results (List of Mnmcs) Display (Selection From List) Lien Holder Listed PD Bates Number 8/23/2013 PdobneyOI Partial Zip Code REDACTED REDACTED REDACTED Integrity Texas Funding PD 012493 to PD 012495 10/28/2013 PdobneyOI Plate REDACTED REDACTED REDACTED Integrity Texas Funding PD_OI2980 to PD 012981 11/1/2013 TMX F01t Worth 4 YIN REDACTED REDACTED REDACTED Integrity Texas Funding PD 018688 to PD 018689 12/3/2013 PdobneyOI YIN REDACTED REDACTED REDACTED Integrity Texas Funding PD_OI3191 to PD 013192 1211612013 PdobncyOI Plate REDACTED REDACTED REDACTED Integrity Texas Funding PD 013247 to PD 013248 12/]7/2013 Taylor Sullivan YIN REDACTED REDACTED REDACTED Integrity Texas Funding PD 017988 to PD 017990 1/17/2014 PdobncyOJ Partial Zip Code REDACTED REDACTED REDACTED Integrity Texas Funding PD 013545 to PD 013546 2/20/2014 PdobneyOI Plate REDACTED REDACTED REDACTED Integrity Texas Funding PD 014014 to PD 014015 2/20/2014 PdobneyOJ Partial Zip Code REDACTED REDACTED REDACTED Integrity Texas Funding PD 014016 to PD 014019 2/26/2014 PdobneyOI YIN REDACTED REDACTED REDACTED Integrity Texas Funding PD 014084 to PD 014086 2/2812014 TMX Fort Worth 4 VIN REDACTED REDACTED REDACTED Integrity Texas Funding PD 018814toPD 018816 318/2014 PdobncyOI Plate REDACTED REDACTED REDACTED Integrity Texas Funding PD Ol4220toPD 014223 412/2014 PdobncyOI VIN REDACTED REDACTED REDACTED Integrity Texas Funding PD_014360 to PD_014362 5/19/2014 James SchafCr Partiill Zip Code REDACTED REDACTED REDACTED Integrity Texas Funding PD_006477 to PD_006478

0'\ ""' PD_022382 ACCOUNT_IDENTIFIER ACCOUNT ACCOUNTID EMAILID STATUS ACCOUNTIYPE BILLTYPE BILLEXPDATE LNAME FNAME 10503349 1399113 TX [email protected] 0 c 2 2016-08-01 Page Ernest 10506290 3633225 TX [email protected] 0 c 2 Hale Todd 10506333 9205388 TX tmx·[email protected] 1 c 3 2015-04-01 Arellano Gabriel 10500436 9569219 TX [email protected] 0 c 2 Bravo Estela 10506079 9636450 TX [email protected] 0 c 2 2013-08-01 Ho<Nells Joshua 10494788 11324669 TX [email protected] 0 c 2 2013-09-01 Berry Curtis 10511025 11988406 TX [email protected] 1 c 9 2015-12-01 Lira . Ricardo 10509475 12522566 TX ·[email protected] 0 c 3 DELEON FELIX 10505537 12605197 TX james.griffin@tlt!emax.biz 0 c 2 2015-02-01 Griffin Jim 10503873 14918914 TX [email protected] 0 c 2 2013-04-01 Deleon Blaine 10509978 16440562 TX [email protected] 0 .c 2 SulliVan_____ Tayl_or _.

10503108 20994108 TX [email protected] -: 1 C. 2 2017'02-01 _- ---oObrtey ·.:--__ --Pefi"rly: _- · 10507788 23012910 TX [email protected] 0 c 2 2014-02-01 Wooten Sk0er 10524421 23115630 TX [email protected] 1 -c 2 2017-05-01 :·Schafer- ·-:-James· 10496806 23643523 TX kevin.wi!lis@tit!emax.biz 0 c 9 Wi!fis Kevin 10527270 33163845 TX [email protected] 0 c 2 2016-07-01 Tucciarone Gerald 10505301 33371030 TX [email protected] 0 c 2 2014-02-01 Easton Alysia 10497454 35031270 TX [email protected] 0 c 2 2014-08-01 Damico Scott 10500881 237693958 TX [email protected] 0 c 2 MARTINEZ ANNETTE 10514374 0165-523-78-954-0 FL [email protected] 0 c 2 2013-10-01 OBrien Lindsay 10507313 TITLEM001 CORP [email protected] 0 I F Matthews William

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pJJJlLI CUAllL!i!lffi, Home I My Account I At:count History I Autosearch I Refer Friends & Earn Lookups I Logout +Texas· Department of Motor Vehicles [Owners] Detail Record Dctn ils ., ' " ROYSE CITY TX Redacted Redacted

3191 '"'"" """V' .._u•WI'-"'"' '..1"'"/'1 '"""' •u"""~' PASS-TRK 0050 0000000000 Vrllirlt: Sold Dale Vt'lu'c/r Eny•ly 'rVc{~lll Vcllick Gross Wdglll 00000000 004800 004800 • ~ I " ~ I Bmrrf,•d Tillt•luft~m~11iau Doruu~·ut T!tP<' llifom~lliMr V,•Jrick Odmutttrlrr{cwrrtirm Difulltifonmtion none folmd 01· REGULAR TITLE A= ACUTAL MILEAGE 0= VEHICLE IS NOT DIESEL POWERED DOT Sfrtlldrmfs lujl)nmliou DPS Stolcu flufica/or Rcgl$/mlioll Eumplion Fiwd Ucd Wciglt/ l•ifonmlicm =VEHICLE DOES NOT 0 • VEHICLE IS NOT STOLEN 0 =VEHICLE IS NOT 0 =VEHICLE DOES NOHIAVE OVER MEET STANDARDS EXEMPT FROM 2/3 OF BED WTIH PERMANENTLY REGISTRATION FEES MOUNTED EQUIPMENT Flot'd Dmmg,· /ujom~Ttimt Gol'!'nWl'll/ O!VI'IIm=llip lujonm/Wtl Till•• Hoi Cfrt"d.: /lifonmfiou lu~p<'rliou WaW,•d lliftumltlml =VEHICLE HAS NO 0 =VEHICLE IS NOT U.S. GOVERNMEN 0 ·NO HOT CHECK 0 =TEXAS SAFE1Y JNSPECITON IS FLOOD DAMAGE OWNED EXIS1S FOR TITLE NOT WAIVED APPLICATION juuk Titlt fujomuli:m Pnmil R••quin•d Iufpnmlwn J(l'/nu7t lujom:t!linu Rt•con$/n<cttd lnfonmliou • VEHICLE HAS NO JUNK 0 =NO PERMJT REQUIRED 0 =NEVER SALVAGED 0 = NOT A RECONSTRUCTED VEHICLE RECORDS Snn•Wnrslrip llgn'<'IIA'UI/tifomllllilln Till•• Rrl'n~t:d Ilifmmrliflll DPS Susp.'115irlllllr{Mmlicm Nt•avy U~r T11X lrifcmmtiou = SURVIORSHIP 0 =TEXAS TITLE IS NOT REVOKED 0 =SUSPENSION NOT 0 =VEHICLE IS EXEMPT FROM PROOF AGGREEMENT IS NOT PART ISSUED OF PAYMENT FOR 1HE HEAVY OF 1HE VEHICLE'S TITLE VEHICLE USE TAX R••,~;istm/irm Vulidity /lifommlicm Rr·sistmlinu Hnl Clu•ck /lifom~1finu Uwrs,• {1/af,• S!'i::un·lnfrmmrlirm R.rgis/mliCIII Sticka s,•i::ml' l•ifnnmlimr =REGISTRATION IS VALID 0 • NO HOT CHECK ISSUED FOR 0 =REGISTRATION 0 =REGISTRATION STICKER NOT REGISTRATION OF VEHICLE PLATES NOT SEIZED SEIZED El~ctnmic T1tl~ ltifonmlion U:ttK<Itl.nw lufonmliou • NEGOTIABLE TITLE ON 0 =VEHICLE HAS NOT BEEN PAPER IDENTIFIED AS BEING REAQUIRED TO DO LEMON LAW COMPLAIN1S Above i11jormofimr os pmvided b!f sfotc- hi!!ow nrr our omw!nfimts C/id:.lrcn:for mo:m·vtlrtd.·!onltlri..:: addil':!S iCfitk /we {fltlllon:vrlddt$ r'u/lri; men flJaf.:Numbtr '• ·, ~ :. • Royse Royse City,1X 1;®$1®1 CRy,TX7S189-4670 175189-4670

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PD_013247 0615 ,PURLIGBAI!&!!JIL Borri~ I My ·ACcount I Accourit Histo'ry I AUtOsea'rciJ ·I Refer F~dS & ·Earn LookUps I Logout 1$- Texas- Deparhnent of Motor Vehicles (Owners] Detail

Record Details Owucr Ntw~· OwuaSrn·eJ OwuaCil!f Onou.•rSIM~ j;@tml@ 1;@@1@ DALLAS TX .-. -.

Owner ZIP Code Pll'Vimls Owucr NrJlll.! Pn:tri~u.<OnmcrCity 75243- ~ MESQUITE TX RL'II('loa/ Nr>/ic.•Sin~·J Rmrwal No/ier.• 5/n/r Rrurwnl Nalia ZIP Codt•

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PASS 0000 0001669500 Vcfridr Sold D1r/e Vtlddr Ewpl!f Wl'i"ght Vrldclr Gro$.~ WrWrl VinNumlw 00000000 003400 003400 I@Fifi@• f1rmdrd Tilk /nfnnmtion DIIC!IIlk'll/ TYJ~' /ufrmmliml Vr•lrick OdomL'/r•r lnfom~llion Oil•;,•/Jufrmunliou none found 01 • REGULAR TITLE A= ACUTAL MILEAGE 0 • VErllCLE IS NOT DIESEL POWERED DOT 5/mrrlmd~ /ufonmliou DI'S Slclclr ludimfor R,•gi$/m/ion E:c<'mplion f"Lwd Brd \Vc·(~flllrifom~Tiion • VEHICLE DOES NOT 0 =VEHICLE IS NOT STOLEN 0 = VEHICLE IS NOT. O=VEHICLEDOES NOTHAVEOVER MEET STANDARDS EXEMPT FROM 2/3 OF BED Wffil PERMANENTI.Y REGI51RATION FEES MOUNTED EQUIPMENT Flo~rl Dnlll1j/l' Iufonmlfrm Gavrnm!o!ul Ouwrmlrip lrifrmmllilll Titlt• Hc-1 Clr~tk /rifllmllllil>u Jnspt•cli!lu Wniv.·rllrifllmmion ·VEHICLE HAS NO 0 =VEHICLE IS NOT U.S. GOVERNMEN O=NOHOTCHECK 0 =TEXAS SAFETY INSPECJION IS FLOOD DAMAGE OWNED EXIS1S FOR TITLE NOT WAIVED APPLICATION /mrk Tille lrifonmll'ou Pmnil Rrquin•d llr[Mmlwll Rebuilllriform1/inn Rwm~lmclcrl/ufnmlflliM • VEHICLE HAS NO jUNK 0 "'NO PERMIT REQUIRED 0 = NEVER SALVAGED 0 = NOT A RECONSTRUCTED VEHICLE RECORDS Sun•i!'or~/rip Axn·~m·rrllnjtmmfiou Titk Rc•Poh·d lnfonmlfon DPS Susl'c.'HSiPn lufilnmliorr I /t'm•y U$t' Tu.r Infonmlirm = SURVIORSHIP 0 =TEXAS TITLE IS NOT REVOKED 0 =SUSPENSION NOT 0 =VEHICLE IS EXEMPT FROM PROOF AGGREEMENT IS NOT PART ISSUED OF PAYMENTFORTHE HEAVY OF 1HE VEHICLE'S TITLE VEHICLE USE TAX R~8i.<.lm!iou Vnlidil,ll hrfonr~l/ioll Re.~L<Imliou No/ Cl!eck /ufnnmticm Urcm~ Pill/~ S~i::wl.' hifonr~J/iou f(,•gi<tm//,111 Slider Sd:::rut• /u[llnmliorr • REGIS1RATION IS VALID 0 = NO HOT CHECK ISSUED FOR 0 • REGIS1RATION 0 = REGIS1RATION STICKER NOT REGIS1RATION OF VEHICLE PLATES NOT SEIZED SEIZEO El.·clnmfc Till!~ /rrfrmmlion L•molll..nw llifonmfiou • NEGOTIABLE 'JTJCE ON O=VEHICLEHAS NOT BEEN PAPER IDENTIFIED AS BEING REAQUffiED TO DO LEMON LAW COMPLAThl1S Above informnticr/1 ns Jll'OVided llysfnfc- below arc our mmofntious Click /t(n"for J/IOil' trdrkk• ,r/llri$ addtr~s Click frm•formcw v.-hich"!' iu tfri$ mJ'a Plait Numbtr Redacted Redacled l;@fffi!ffliM 75243-7122

Lien Holders Um Holda PoMiou UmDafr 1 20130603

Lien Holder Infonna lion u,·n Holda Nmrli' li<'ll 1-io/du Numb~ I' Stm•/ 5/n·cs (c<JuJ) INTEGRITY TEXAS FUNDING 081001660 4401 LEMMON AVENUE City S1111~ z;,c..rt,· Cormln; DALLAS TX 75219- PUO't32> 8 P!IIUI&Ilt\.IA.ii!!tn Home I My Account I AccoWlt History I Autosearch I Refer Friends & Earn Lookups I Logout It- Dallas County(Texas)- Civil Court [Prior to Nov. 2005] Detail Record Details Court ... '.

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= VEHICLE IS NOT SIDLEN

" I =VEHICLE HAS NO •VEHICLE 15 NOT U.S. =NO PERMIT REQUffiED

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Lien Holders l.k11 Holda Posti<>ll Ucu Dmc 1 20130705

Lien Holder Information U..·u Hol!/,•r Nam,• lic11 Holda Numkr Sltw/ Stn:el ((OHIJ INTEGRITY TEXAS FUNDING 081181376 6210 WESLEY STREET City Sin/.: Zip Cod~ Crmulry GREENVJLLE 1X 75402-

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Redacted Bed Wei&hl llifonllllliou VEHICLE DOES NOTHAVEOVER

0 = NO PERMIT REQUrRED

0 • TEXAS 1TILE IS NOT REVOKED

Greenville,TX 75402-90311

Lien Holders Ue11 //older PMiiOII 1 20010611

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Lien Holder Information Lim Hc>ldrrNumbrr Sln'l'l (coni) COMMUNITY CREDIT UNION 032726377 P.O. BOX867239 City lip Code Cc>tmlnJ PLANO TX 75086- N-P Feb 20 2014, 15:45:56 0140220154556154556 020994108 TX DETAIL B=txdmv PD_014017 0625 ed=ll6 ~=13571163021 ip=l74.141.1.220 method= GET refer-http:l/lbsenrch.publicdata.com'PDSearch.php?

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Lien Holder biforma fion lku Hold.•rN.111re Um HolrlcrNumbtr Sin:~ I Stn·ct (ron/) INTEGRITY TEXAS FUNDING 071608359 6210 WESLEY STREET Cit}! Stalt' Zip Code Country GREENVILLE 1X 75402-

Feb 20 2014, 15:46:27 140220154627154627 020994108 TX DETAIL B=txdmv ed=ll6 rec=l3582131475 ip= I 74. I 41.1.220 ITK!thod=GET rclbi=http://lbscnrch.publicdnta.comiPDScnrch.php?

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Feb 26 2014, 12:07:14 0140226120714120715 020994108 TX DETAJL B=L-.:dmv PD_014084 ed=l16 0628 rcc~51560 16994 ip=l74.141.1.220 mcthod=GET refer=httpillbsearch.pub licdatll.com1pdseareh. php ?p 1:=:jnras0Bu03xl 0 I 721 &inpuf;ogrp_dmv_ vin&tacDMV=DPP A- 04&type=vin&dlnumber=020994I 08&d1state=TX&id=2084C 1F2360F65AF73 125C32883FC041 &identifier= 10503 108&sessionid=DE6692COA762998923 i9873B030E7256&o=grp_ dmv_ ' server-Ibsearch.publk:dafa.com requestagent=PDdi<;play-201 lOt 1 tee tacdmv=DPPA-04 wcbfilc=20 140226-SHADO W I06.htmll464890969

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Lien Holders PO 014085 lumoatc 1 20120820

Lien Holder Information Ueu HolrhNtmlt' lim HoldcrNmu/!er Sired Sh~cl (COli/} lNTEGRI1Y TEXAS FUNDING 071144553 15298 W BUCKINGHAM BLVD City Slrtle ZipC(Ide Cou11/ly GARLAND TX 75042-

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On•ncrNanl:! OWI!UCily OH•urr Sfa/( Redacted HOUSTON TX Owner ZIP Cmf<! Pn1110u! Ou.olletCfl!l 77042- • • I "' • I ROSENBERG 1X R<~I>'1V!II Nvliu $/11'<'1 Rrnrwaf Nulicr Stair

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Lien Holders Um 1-/o/dcr Po~fio11 Urn Dnk 20130615

Liell Holder 11ljorma lion Sin:..•/ INTEGRITY TEXAS FUNDING 081071028 12903 WES1HEIMER RD Cily Stnl.: HOUSTON TX

Certified T.ien Hnlders Mur 12 2014, 16:10:29 20140312161029161030 011988406 TXSEARCH Type=vin LN•TXDMV DB9Xdmv pi Redacted ip= 174.141.1.220 mcthod=GET rcfcl""http1/Jbscorch.publicdata.com'pdqucry.php?o=grp _dmv_vi:n&dlnumbcr=O t 1988406&dkl:ltc=TX server-fuset~rch.pubticdata.com requestagent=PDdisp1ay·20 110111 cc tacdmv...DPPA-01 webfile:=20 140312-S HADO W 106.htmlj82040(i046

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Terms of Use I Frequently Asked Questions I Contact Us I Policies and Positions! About Publidbt~ All informiltion contained herein @Copyright 1997-2014 • Pub!icDatil.Com 'Pi§§ Y*Ji & &!J%&?9Pi&- f #4! q; A&MP?"@X£149-,?& &&dCN Z&~DZii@Ji 9¥1P\i&ifilil;§k!lii'h%1?_i¥ Mnr 12 2014, 16:10:46 0140312161046161046 011988406 TXDETAIL B=txdmv d=ll6 rec=ll55447I564 ~-174.141.1.220 method=GET refcr=ltttp:lllbscarch.publicdata,com'pdscarch.pltp?p I~input=txdmv&tacDMV=DPPA- 1&typc=vin&dlnumbcr=O 1198840G&dlsto!c=TX&id=&id!!ntifier=&scssionid=&o=grp_dmv_ vin er=lbsearch.publicdata,coln qucstngcnt=PDdisplay-201 10 Ill cc tacdmV"'DPPA-0 1 webiile=20 140312-SHADOWI 06.htmlj820860747

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Lien Holders Lim Holda Posliou UmD.tt.• 20131105

Lim Holder InfomUJ tiou Um Holda N111r~· Um HolllnNwul>•'r Stn.•,•l StT!'rl (coul) lNTEGRITY TEXAS FUNDlNG 082000419 2819 S GARLAND AVE Cily Sial.: Zi/'C'c>rl~ Cowrlry GARLAND TX 75041-

Certified Lien Hnlders Mar8 2lll4, 12:00:08 20140308120008120008 020994108 TX SEARCH Typc=platc LN=TXDMV DB=txdm\' pJo~ ip=!74.141.J.220 method,.,GET rcfcFht1p:/llbscorchpublicdaln.com'pdqucry.php? o=grp _dmv_platc&d!number=0209941 08 &dlstnte=TX&id=OOCBS 5FC3BBE7F339B7 FC43 C709449CA&identifiep I 05031 OS&sessionid..:BAOS E4AOE6DA5CE870D3 E71 AECEF AS9 scrver=lbsearch.publicdata.com rcqucstagcnt=PDdisplayM20 II 0 Ill cc tacdm'FDPP AM04 webfile=20 140308-SHADO\Vl OS.htmljl28866JJ 0

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none found IS NOT DIESEL

0" NO PERMIT REQUIRED

O"TEXAS IS NOT REVOKED

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Certified Lien Holder::; Mar 8 2014, 12:36:55 20140308123655123655 020994108 TX SEARCH Typc91latc LN=GRP_DMV_PLATE DB=grp dmv_plate pt1@@1$1 ;>= 174.141.1.220 method= GET rcfur=http://lbscarch.publicdatn.com'pdqucry.php? o=grp_ dmv_platc&dlnwnbct=0209941 08&dlstate=TX&id=OOCB5SFC3 BBE7F33 9B7 FC43C70944 9CA&idcntificr= I 0503 I 08&sessionid=BA05E4AOE6DA5CE870D3 E71 AECEF AS 9B server=lbsearcltpublicdato.com requestagent=PDdisplay-20 1101 11cc tacdlllV"'DPPA-04 webfile:::20 1403 08-S HADO WI 06.htmljl68045 648

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Mnr8 20l4t 12:36:56 0140308123656123657 020994108 TX DETAIL

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PD_014223 0637 Apr2 2014, 08:34:17 140402083417083418 020994108 TX SEARCH

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.PllRUklltlli\.c ont Home I My Account I Account History I Autosearch I Refer Friends & Eam Lookups I Logout * Texas- Department of Motor Vehicles {Owners) Detail Record Details OwuaNan~<.' Owner Sln:cl OwnaCi/.1! Owu~rSinl~ Redacted i;@!jAHft DALLAS TX Oumrr ZIP Co,"/,• Pn.·vi.ms Oum~r Nmtl' Pn~inus OWII<'tCily Prcr•ir:lu~ Onm!!r Stnh' 75217· ONIRON AUTO SALES DALLAS TX Rrlli'IUI!I Nutirr 5/n:(/ Rrnrwal Nntirr Ctly Rmrwul Nulicr S/11/r Rcnrwa/ N<l/fcr ZIP C11dr

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Licll Holder Information l.it:n Hollf,•rM!ilt' Uw Ho/lfaNtwd,,•r Slm•/ SJn•d froul) INTEGRITY TEXAS FUNDING 081762388 3639 GUS THOMASSON RD. City Stair ZiJ>Co,1<' Cotm/Jy MESQUITE TX 75150-

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Redacted HOUSTON Redacted Redacted

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Yc>uraccotml D23115630·TX lmsbw!dwrgtd1 'Ulok·llp'on May 19,2014 at 15:51:58.

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Plt!lllCIJATa~com Home I My Account l Account History l AutosearCh l Refer Friends & Eam Lookups I Logout *Texas- Deparbnent of Motor Vehicles [Owners) Detail Record Details Owurr Nrww OWIII'r Sltrrl Dlvn,•rCity Ou•urt·Stnl!'

~ljfifi~·tA~S!~·~~~~~~~~--_j Redacted MCKINNEY 1X OWIJt'rZ!PCod,• /'n:vious Own a Nnm: Ptn•ious Owu~rCily Pn..,iousOwllcrStnh• 75071-6289 Redacted GRAND BLANC M1 Rc~JC~on/ NPiirc City R,•nc'lJml Ncr/in: Slntc ,'?,,•ucwnl Nc>lieo: Z/1' Codc

Rr,wwnl Nc>/in• 7./P+4 /Juu~· Pinto• Num[•,•r Pn·~>icrus limtu Plnl<' Numl•rr l'tt'l•ic>us F.xpimtinn Mou/11 ~ 02 Pn·t•iC>ttS E.YI'imtWu Y<.•nr R,-sistmUou El'pimlion Y<.w Rcgistm/iou £xl'imtio11 Mou/lt Rcgislmtiou Effccli!N 2014 2015 02 Marl 2014 PO 006477 Til/cDnl~ Owu,•n:llip bifomttl/km Mnd<'IYmr Mnkr Aug 9 2012 03 =OUT-OF-STATE TITLE I 2003 CADILLAC M&dd MOtlel Ol!.>cl~t!ion Vd!iclr! B(IJy TYI"" Vdu·d~ Major Col&r(Co/orGnmpl CT CADICT 4D = 4-DOOR SEDAN SILVER (Color Grou SILVER) Vellidr Minor C&lnr(Color Grtlltp] \fehiclc Class Code Vcl!ideTommgl.' Vel!iclt Snle$ Price PASS 0000 0000000000 VdriclcSoldDnlr \lellidc Emply Wct:'{llf Vddclt• Gross Wdgh! ViuNuml>tr 00000000 003800 003800 . ~'.

lJoud~dTillc lnf11nllllliou Do~;muc:ul TyJ't: llifnmwtiou V<'l!idt.! Odot11ckr Tufonmlion Di•":!d tufonmliou none found OI = REGULAR TITLE A= ACUTAL MILEAGE 0 = VE!-!JCLE IS NOT DIESEL POWERED DOT 5/mufnnls JufonmliPU DP5 51~/rn Iurfimlor lto•gislmlinu Exo·tt,pliou Ftn•d &-d Wright /lifnmwlinu =VEHICLE DOES NOT 0 =VEHICLE IS NOT STOLEN 0 =VEHICLE IS NOT 0 =VEHICLE DOES NOT HAVE OveR MEET STANDARDS EXEMPT FROM 2/3 OF BED WITH PefuV!ANeNTLY REGISTRATION FEES MOUNTED EQUIPMENT Flood Dnuugr llifonunlion Gol•o'mH'/1/ Owrurn;/lip liifonmlion Tillr Hoi Chak Iuf"mflllion JmprcliM Wail:r•tlltifl)muliou • VeHICLe HAS NO 0 • VEHICLe IS NOT U.S. GOVERN MEN 0 • NO HOT CHECK 0 =TEXAS SAFETY INSPECTION IS FLOOD DAMAGE OWNED EXISTS FOR TITLE NOT WAIVED APPLICATION ]rmk Tillr llifonr~11fuu Pcmli/ Rrquin:d lrifonmlrr:m Rcl>w1f /ufrmmliou ltrcous/nrct,·d lrifom::rlil.'n =veHICLE HAS NO JUNK O•NO PERMITREQUffiED 0 = NEveR SAL VAG ED 0 • NOT A RECONSTRUCTeD veHICLE RECORDS 5un•il·Q~l!lp A:.;:n'!'tt~r:ul/tif~nlllllhm Tillr lkvnkrd Trifnmwlitm DPS SII5J..:Il5iou iufnnmtiou Ht•twy US<' Tax lnfonmliolr • SURV!ORSH!P 0 =TEXAS TITLE IS NOT REVOKED 0 • SUSPENSION NOT 0 • veHICLE IS EXEw!PT FROM PROOF AGGREEMENT IS NOT PART ISSUED OF PAYMENTFOR THE HEAVY OF THE veHICLE·s TITLE veHICLE USE TAX Rcgislmliou \'nlidily lrifom~J/iou ltrgL~Jmlio11 /lot C/wck lnfonrL1/iou l.icrJI$<.' Plnlr Sri.:rrrr /rifomrn/hm Rrgis!mlio11 Stickrr Sti;;"wr llif~nmliou =REGISTRATION IS VALID 0 =NO HOT CHECK ISSUED FOR 0 =REGISTRATION 0 • REGISTRATION STICKER NOT REGISTRATION OF veHICLE PLATES NOT SEIZED SEIZED Ek,lwuit Til/o.'/rifonrwliou lemon l.mu /ufonmtiou 2- NEGOTIABLE TITLE ON 0 ~VEHICLE HAS NOT BEEN PAPER IDENTIFIED AS BEING REAQUffiED TO DO LEMON LAW COMPLAINTS Above infarmntion as p1'ovidt'd by stnfe- below nrc our mmotnfiolls Click lrcn: for mo;:on:ve!ricles a/this addn:5s Click llc~l·Jormnro vdu"cles iu /Iris arm J>lnlc NrmWa Redacted edacted TX75071· ~I • • I

Mckinney, DC 75071-6289 6289

Lien Holders Ucn Holda Poslion UmDntc 1 20120725

Lien Holder Information U~n Hold~rNIIIII<: lkrr J-!p/dcr Nunrb(r Stn:<'l 5tn:c/Jccm/} INTEGRITY TEXAS FUNDING 07220S028 1600 WEST UNIVERSITY DRIVE Cily Sialt• Zip Cod,• Counl!y MCKINNEY 1X 75069· Certified l.if'JJ 1-lnldm·.<; E,W:i&BW ::q;, ~~ .21 A£~ ,liffij May 19 2014,16:06:36 20140519160636160637 023115630 TX DETAIL DB=txdmv ed=ll7 rec=3913412516 ip=216.207.175.4 mcthod=GET refcr=http:lllbsearch.publicdata.comlpdsenrch. php?p 1=t3HGCM56373G706271 +&input=grp_ dmv_ vin&tacDI\ifV=DPP A- I&I)Jle=vin&dlnumber-=023115 63 O&d!state=TX&id=&identifier-&sessionid=&o=grp_ dmv_ vin servcr-lbsearch.publicdata.com requestagcnt=PDdi>play-2011 0 Ill cc tncdfll\=DPPA-01 wcbfilc=20140519-SHADOW! 05.htm!l80 1152654

PD_006478 Dnnv rnn HYit ---- 0642 EXHIBITB

0643 SEC Info Home Search Mv Interests .!::!run S1gnJn Plectse s;gu /11 TMXFinance LLC · 10-K ·For 12/31/12 Filed Onm1l..U.1 4:40pm ET · Accession Number 1104659-13-24898 • SEC File 333-172244 in Ithls entire Filing, ., I Show IDocs searched ,.I and Iewry "hit".

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fOr/On/As ppcs•Sj;2 10-K i?./31 /12 78:14M ~~~I"'rill Corn-l1P/fA

Annual Report - Fonn 10-K Filina Tahlc of Contents DocumgntiEllhihi t OMqdption -.... Uu ,, 10-K Annual Rgport HTHL l.42M ,, 2o ~ F:X-10 , Material Contract l~aterial Contract HTML HT\4L 34K <ZK ,,,, •1: ~X-lQ 22 £A-lQ ?1 Material Contract 11aterial Contract HT11L HTHL 107K l75K F:X-?1 1 Subsidiaries of the Registrant HTHL 47K ,,'',, ~ £:<-:'11 2 Certification per Sarbanes-Oxley Act (Section 302) Certification per Sarbanes-Oxley Act {Section 302) HTHL HT!~L 31K 32K F:X-:;? l Certification per Sarbanes-Oxley Act {Section 906} HTI~L 26K 10: ~ Certification per Sarbanes-Oxley Act (Section 9061 HTHL 26K 32: F:Xr.F:r XBRL IDEA ~Jorl:book -- fi'nancial Report (, xls) XLS 2' 56~1 55: El Document and Entity Information HTML 51!( 4: E2. Consolidated Balance Sheet~ HTl~L 12SK 53: l!l Consolidated Balance Sheets (Parenthetical) HTML 29K 57: M. Consolidated Statements of Income HTML B7K 72: R.2 Consolidated Statements of Member's Equity and HTML 44K Noncontrolling Interests 6: !!f. Consolidated Statements of Cash rlows HTML 163K 52: El Nature of Business, ?rinciples of Consolidation HTML 91K and Significant Accounting Policies 40: Ell Credit Quality Information, Allowance for Losses HTML 81K on Title Loans Receivable and Liability Related to Unconsolidated CSO Lender Loans 31: ~ Concentration of Credit Risk HTML 32K 73: BlQ Property and Equipment HTHL 60K 59: Ell Other Assets HTML 47K 58: R12 Acquisitions HTI~L 361< 63: E.l..l Senior Secured Notesr Revolving Credit facility HTNL 92K and Notes Payable 64: B.l..i Accounts Payable and Accrued Expenses HTML 471< 62: E.l.2 Other Operating and Administrative Expenses HTML 58K 65: B.l..fi fair Value Measurement and Fair Value of Financial HTI~L S3K Instruments 54: El.1 Employee Benefit Plans HTt-lL 29K 56: E.1.B. Related Party Transactions HTNL 32K 61: E.1.]_ Corrunitments HTI1L 69K 78: .!UQ. Contingencies HTNL 32K 68: R~l Phantom Stock ?!an HTNL 28K 9: B22. Chapter 11 Bankruptcy Filing HTML 29K 60: ill. Guarantor Condensed Consolidating financial HTML 781K Statements 51: all Nature of Business, Principles of Consolidation HT!•!L 129K and Significant Accounting Policies {Policies) 24: ~ Nature of Business, Principles of Consolidation HTML 53K and Significant Accounting Policies (Table&) 69: .8.21i Credit Quality Information, Allowance for Losses HTI·!L a3K on Title Loans Receivable and Liability Related to Unconsolidated CSO Lender Loans (Tables) 75: E..U Property and equipment (Tables) HTHL S<lK 35: B2J! Other Assets (Tables) HTML 46K 34: B.2..1 Senior Secured Notes, Revolving Credit racility llTML 70K and Notes Payable (Tables) 38: E.1D. Accoun~s Payable and Accrued Expenses (Tables) I!THL 46K 39: R31 Other Operating and Administrative Expenses I!TML 58K (Tables)

0644 41: E.lZ. fair Value Measurement and fair Value of Financial HTML 41K Instruments (Tables) 22: E.J..1 Commitments (Tables) HTNL 671< 66: B.M. Guarantor Condensed Consolidating Financial HTML 617K Statements (Tables) 48: BJ5. Nature of Business, Principles of Consolidation HTML <7K and Significant Accounting Policies {Details) 50: !U.2 Nature of Business, Principles of Consolidation HTML 37K and Significant Accounting Policies (Details 2) 28: Ell Nature of Business, Principles of Consolidation HTl~L 46K and Significant Accounting Policien {Details 3) 77: !<3R Credit Quality Information, Allowance for Losses HTML 50K on Title Loans Receivable and Liability Related to Unconsolidated CSO Lender Loans {Details} 17: E..19. Credit Quality Information, Allowance for Losses HTML 49K on Title Loans Receivable and Liability Related to Unconsolidated cso Lender Loans (Details 2) 42: B.:L!l Concentration of Credit Risk !Details) HTML 29K 71: ~ Property and ~quipment (Details) 21: gz 33: ru..J.

Other Assets (Details) Acquisitions (Details) HTML HTHL HTML "" 49K 37: B.E.d Senior Secured Notes, R~volving Credit Facility and ~otes Payable {Details) HTML llOK"" 45: R45 Senior Secured Notes, Revolving Credit Facility HTML 71K and Notes Payable (Details 2) 21: ru..a Senior Secured Notes, Revolving Credit Facility HTHL 50K and Notes Payable (Details 3) 30: E.!2 Senior Secured Notes, Revolving Credit Facility HTML 35K and ~otes Payable {Details 4} 19: R4R Accounts Payable and Accrued Expenses (Details) HTML 50K 70: E..!..9. Other Operating and Administrative Expenses HTt-!L 501( (Details) 6: .B..i2il Fair Value Measurement and Fair Value of Financial HTML 36K Instruments (Detailsl 67: B.ll Employee Benefit Plans !Details) HTML 381< 9: .8.i.1 Related Party Transactions (Details) HTML 35K 43: B.:iJ. Commitments {Details} HTML 611< : R.5.A. Commitments {Details 2) HTML 53K 20: ~ Phantom Stock Plan (Details) HTHL 35K 36: B25. Chapter 11 Bankruptcy Filing (Details) HTML 25K 23: B.11. Guarantor Condensed Consolidating Financial HTML 136K Statements (Details} 4 : B.f!B. Guarantor Condensed Consolidating Financial HTML 96K Statements (Details 2) 47: E.i9. Guarantor Condensed Consolidating Financial HTI-1L 130K Statements (Details 3) 6: ii!:!L XBRL X!-!L File -- Filing Summary XML 1211< 11: EX-lOl.l!JS XBRL Instance -- tm:<f-20121231 Xt-1L 3. 16~1 13: F:X-lOl.(:AJ. XBRL Calculations -- tmxf-20121231 cal XML 2861< 14: f:X-lOl.OF:~· XBRL Definitions -- tmY.f-20121231_def Xl-1L 1621< 15: F:X-101.1-AP. XBRL Labels -- tmxf-20121231 lab Xl-1L 2. ~ 9~1 16: F:X-lOl.PRF: XBRL Presentations -- tm~:f-20'121231_pre XML 1.27M 12: EX-lOl.SCH XBRL Schema -- tmxf-20121231 XSD 240K 25: ?.TP XBRL Zipped Folder -- 000110~659-13-024896-xbrl Zip 232K

IO~K - Annual Report Document Tnhlc of Contents (seque111 ial) (alphabetic) ~ - Filina Suhml<;sion Table ofContents Altemntive Fonnats <Word et nl.l fru:ll 8tt<;iness Item I Certain Relationshins and Relmed TrnnsactioJt~ nnd Djrector Independence Business Changes in and f)i_<;ngreements with Accoml!ants on Accounting m1d illDLlA Fjnancbl Disclosure Rl~k Factors Com:olidated Balance Sheers as ofDccemher 1 I ?OJ? and ?0 II Item IB Con<;oJid<"lted Stntemcnts of Cash Flows for the Years Ended December llnrcsolved St!ilfCormrents "11 ?0!2 2011 and ?010 hem? Con.<;o!idmed Stmements oflncorne lOr the Yem1> Ended Deccmhcr 3 I Prnper1ies 2012 2011 and 2010 ltem3 0645 Consolidated Stnterncnts ofrvlemher's Emritv Hnd Noncontrol!ing Interests Legnl Proceedings lOr tlm Ycms Ended Occemhcr ~~ ?012 20 II and 20 I 0 llJ:m.i Control<> nnd Procedures Mine SnfCLy Dt<>c!nsures J)irectors Executive Officers und Comorate Govemancc EYJ:l..U Executive Conmemmtion Item 5 Ex!Jihrts and fjmmcjpl Statement SchedJJ!es Market !Or Registrant's Common F.quitv. Related Stockhokler Matters and • Financial Stnten"X!nL~ and Stmnlen)21l!arv Data Issuer Purchases ofEquitv Securities Item I ltem6 Item !0 Selected Fimmcial Data Item II .!km1 • Item 12 MMagemcnt's Di~ctl~sion ;md Annlvsis ofFM1nnci<ll Condition nnd Results of Item 13 Opemtions Item 14 Item 7A Item 15 Oum1titmivc and Ounlitativc Disclosures Ahout Market Ri~k lli!n..!A Hem R Item IR Fimmcinl Staten~nl<; and Sunp!emcnti)rv Data lkln.2.

Report oflndepcnderl!: Regi<;tercd Public Accmmting Firm • Item 3 Consolidated Balance Sheel<Ul!wf'Decembcr 31. ?0 I? nnd ?011 Item4 Coi\S'olidated Statement~ oflnco!Th! for the Years Ended December 31 Item :) ?OJ? ?011 m"KI ?010 ltem6 Consolidated St<1tements of Member's Em1itv nncl Noncontrolline.lntcrests llillil.l ltem7A for the Yctlrs F11dcd December 11 :w I 2 ?{)I I and 20 I0 Con<;o!idatcd S!n!cmcnl"> ofCash Flm\'S Cor tim Yrm;s Ended Qccemher 31 lliml.R Item 9 ?012 ?0\1 and ?OJO ltem9A Notes tn Cnmnlid<Jted Financial Stmem"nts ltcm9B ltem9 l.egul Proceeding.-; Chmmes in ami Disnm-eciT"Cnts wjth Accowlt<Jnts on Accotolting and Financinl Manugen~nt's Oi.~cJL~sinn and Analysis nfFinanci<JI Condition and Results Di~c!osJ[C of Operation" lkm..2A Market for Regi~tr<Jnt's Comnun Equ~v Rclntcd Stockholder Mailers nnd Controls nnd Procedures Issuer Pttrclmscs ofRcluity Sccl[itics J..!Qm.2.B Mjne Snfcl\' Dl<>c!QSJlfC'> Olhcr lnfomrution Note"> to Consolidated Fjmmcjal Smtcn-ents Pnrt Iii Other lnfom)ation Item 10 P<lrt I Directors E:.:ecutivc Officers m1d Corporate Govemance Part lj l.!slliill Pari Iii Executive Compensation fill:L!y .l!Jmill Pri11cinnl Accotullflnt Pees and Services Securitv Owncrshin of Certain Renclici<JI Owners nml Mannnetrcnt ami Pronertics Re!nted Stockholder Mnllers Opantitiltive <Jnd Oua!itmive Disclosures About Market Ri5k Item 13 Rcnort nflndercndent Registered Public Accounting finn CertoM1 Relationshb1s and Related TrnnS;)ctions and Director Independence Ri"k Factors Se:cnritv 0\\nC:rshin of Certain Bene ficin! Owners and Mmljlgcmcnt and Item 14 Relmcd Stockholder M<llters prjncinal Accotnltml( Fees and SeJYices Selected Ein;mcii!l Q<11<1 Part lv Signnturei\ Item 15 Table ofContc]l!s Exhjhits and Finnnci<ll Stntemcnt SchcdJ!fcS ( lnrcsolved Sta ll'Comncnts SiPnlll\trCS

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UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549

0646 FORM 10-K ll<l ANNUAL REPORT PURSUANT TO SECTION 13 OR 1S(d) OF THE SECUR!TillS EXCHANGE ACT OF 1934 For the fiscal year ended Qccemlrr 31 201 '2 TRANSITION REPORT PURSUANT TO SECTION 13 OR IS(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the tr:msitioo period from to Commission File Number 333~1722-l.J

TMX Finance LLC (E.'Oict N~tne ofRegistnmt as Specified in its 01arter)

Delaware 20~1106313 (State oflncocporotion) (I.RS. Employer !dtmtilkation No.) Bull Street, S:mmnah, Georgia 31401 (Address ofPrincipnl E.'>l!cutive Qffir;cs) (Zip Code) Registrnnt's Telephone Number, Including Area Code; (2.1]) 525-2675 Securities registered pursuant to Section 12(b) ofthe Act: None Securities registered pursuant to Section 12(g) oflhe Act: None

Indicate by check mark if1he reei~trnnt is a weU-known seasoned issuer, as defined in Rule 405 oft he Securities Act. Yes 0 No IBl Indicate by checkmMk if the regi.~tmnt is not required to file reports pursunnt to Section 13 or Section lS(d)ofthe Act. Yes lEI No 0 lndicnte by check mark whether the re~·i.~tmnt (1) has filed all reports required to 1Je filed by Section 13 or lS(d) oft he Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the regi~tmnt Wtts required to file such reports),ttnd (2)htts been subject to such filing requirements for the past 90days. Yes 0 No lEI (Note: The I'C!!i~trnnt hDs filed nU r¢ports pursunnt to the Securities E'I;Changc Act of 1934 as applicable fort he preceding !2 months) Indicate by checkrnnrk whether the reui~tri!JI! has submitted electronically and posted 011 irs corpomte~. if any, cvcl}•lnter.~ctive Dttta File required to besubmined and pos11~d pursuant to Rule 405 ofRcgulation S~T (§232.405 oft his chapter) during the preceding 12 months (or for such shorter period that the T<Wi~tmnt was required to submit and post such files).· Yes IBl No 0 Indicate b)' check mark if disclosure of delinquent filers pursuant to !tcm40S ofRcgttlation S·K (§229.405 ofthis chapter) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or infom1:1tion statcmcms incomomtcd hv rqfercncc in Pan !II oft his Form 10-K or any omcndmcnt to this FomllO.K. IBl Indicate by check mark whether the rcgisrmm is a J~rgc acccler.ued filer, an accclerotcd filer, n non-ncccl~rated filer, or a smaller reponing company. See definitions of "large acccleralcdjilc:r," "accclerarcdjiler"nnd ".\mallerrt:poning company" in Rule 12b·2 ofthe E.\l:ilongc Act.

Large accelerated filer 0 Accelerated filer 0 Non-accelerated filer !:ID SmaUerrcponinl} compony 0 (Do not check ifn sm.1Ucr reportins compnny) Indicate by check mark whether the re1•istmn1 is a shell cornpnny (as defined in Rule 12b·2 ofthe E...change Act). Yils 0 No IE] Indicate by check mark whetherth!i registrnnt has filed aU documems and reports required to be filed by Sections 12, 13 or !5(d) ofthe Securities E.'lt:hangc Act of J9J4subscqucnt to the distnbution of securities under a plan con fumed by a court, Yes lEI No 0 The Compijnv has 100 outstnnding limited liability comp<my m::m!Jership units, aU of which are held by TMXFimnce Holdings Inc.

Tnhlq nfC'onlent~ TMXFINANCELLC ANDAFFILL\TES FORM JO~I{FOR THE YEAR ENDED DF.CI\.\1Bffi31. 2012

Ri~k Fn<:tnrs 9 \Jnr.•so!vN1 .StnffComl'l'l<!nt~ 17

I ~t:nl Proccedint:s 18 0647 Mine Snfetv Pisclo~ures 18

Mnrl:s::t f<'~r Rcgi~lrnnt's Cn111mon F.!luitv Rdn!d Stockholder ~·lapen; :1!\d l~sn~r Pnrchn~e~ ofEnnity Securities 19 Selected Finmtcinl Pntn 19 Mnnngement'~ Qiscnssinn 11nd ..\nalvsis nfFimmcial Comlitinu nm! Re$ulrs ofOnemtinm; 21 On:~ntitntive nnd Qnalitl!!ive Disclosures -\h0111 Mnrl:ct Risk 30 Financial :':tntemcots nnd Stnm]rnwman• Pam 31 Changes in :tnd Di~al!reements with AccountmttS on Acconntin1• nnd Finandnl Di~clnsnre 61 f'nntrols nml Proceflnres 61 Other lnfopmtion 61

Dirccton Executive Officers nne! Cnmnmte Goycmnnce 62 Execntjve Cnmnensmjon 64 Sccmitv OwMrnltiQ nfCCilnin Bcneficj.~l Owner;; nml 1\!nnngcmctl! nnd Relntcd Stockholdcrl'llil!lcr.: 70 Cer1ain Relntinn3hins ond Rclntct! Tmnsactions nnd Director lnd!!ncndcnce 70 Principnl Accountant fees nnd Sco•ices 72

F.'<hihit.o; nml Finnncjnl St~ttem.,ml Schccln!es 73

TnhlenfCnntents FORWARD-WOKINGSTAT.El\'JENTS 11tis report co/1/ams '1ont•ortf.lookmg stalctt/CIIfs"' 1/wt illl'olvc l"i.rks and :mccrlainlir:s. Fonvurd-looking :rtatemems provide currem cxpeclalion.r ojjilfurc ct'cll/s based on certain e.rpectatlons, assumptions, e.fltmatcs ami projccllom: Font•ard-looklng .t·tatcnuml.f can he Jdentljlcd by lbefoctlhatthcy do not refale slricll)' lo hi.vtorfcal orc111"1"CIIf facts aud frequently colllflill words.wc:l1 as "anticipate," "a,t:mmc," "hclfct•c," "budget," "comlnuc," "could," "csllmale," "c,rpccl, ·• ''jillurc, ·• "!mend, ·• "may," ''plan," ''polenflaf," "predict," ''proji!CI," "will" tmd other .m111/ar terms. All :rlolements .thai address opl!ralmg performance, e\•en!.f ordcvdopmmls that we c.rpccl oranlic1palc will oCclfr 111 tllcjitturc- mcludrng s/atcmi!IIIS relating to demand for our products and .~erv(cc.v, safes growth, comparable l"ION! safes, sf ore opcnlllgs, slate afrhc economy, capilaf alloca/ion and expenditures, liqutdil)' amllhc effie/ ofadopting certain accouming sumdards- ore font•ard-louking stateme/lls. Font•ard-looJ:ing .~loteiiWI1fJ.' ilwnfwt risk aud ore not guorunlees njji1111re petfnrmonce. 711<' ( 'm11!>1m\' 's ar::mal results may diffir signijicam~l·from currem c.rpectmions as (•,rpre.rsed ur implied in tlw fanvard-lonking srarcmcnls. Foclors lfwl might cau.rc ,\"ItCh tlijforence.f Include, but ar;: nollfmiled Ia, !hose df.~cusscd m "Item /A. Risk Fac1ors" in this report. 711<' rnmnnnr assumes 110 obflgalioutn ret•isc or update onyjonJ•ard-loaking .fttllcmcllfs, except as J'eq111red by faw, PART I ITI!:i\-11. BUSINESS.

Introduction TMX Finance LLCis a privntdy-owned nutomobile title lending company with 1,035 company·owncd stores in 12 stares ns of!X:cemhcr 31 :w12. We provide our customers with access to funds throush loans secnred by a lirst or secontllien on the customer's automobile. Our loan products :lllow our customers to meet their liquidity needs by borrowing against the value oftheir vehicles while allowing the customer to retain use ofthe vehicle during the temt ofthe loan.

TMX Finance LLCis a limited liability company that was formed in Delaware in 2003and e~sts solely ilS a holding company to O\mthe equity interests of its 8tth~idinri¢s. TMX Finance LLC changed its name from TitleMax Holdings, LLC to TMX Finance LLCeffective Inne 21 2010. Effective Sep1emher "";Q '012, Imp Young, the fom1er sole member ofTMX Finance LLC, transferred !00"'.4 ofhis membership inlerests to newly-formed TM:X Finance Holdings [nc., or our "Parcm," in e>J:hange for shares of common stock of our Parent.

Mr. Young is the sole beneficial owner of the common stock of the Parent. We referto Mr. Young in this report :~s the "Sole Slmreholdcr." Unless the conte:-a indicates otherwise, references in this report to ''1"MX Finance," the "Company," •·w(.."," '"11s." "our" or similar term> represent TM:X Finance LLC end its consolidated affiliates.

Our principal COijlOrate offices are located at 15 Bull Street, Suite 200, !>~wmn~h C~ornijl Jl40l, and our telephone number is @) 525-2675. Our wchsitc: address is www titlenL1Xhi7 The infomunion on ourwch~ite is not a part ofthis report.

Oveniew Our automobile title lending business provides ll simple, quick and confidential wo.y for consumers to meet their liquidity needs. We offer Iitle lonns in amounts ranging from SIOO to SS,OOO to customers who gencrnlly have limiJcd access to consumer credit from banks, thrift institutions, credit card lenders and othcrtr.~dilionnl sources of consumer credit As of Dqcemhcr .11 2012, we had appro:cimatcly 470,000 customers and S577.2 m~llion in title loans receivable. We believe we arc the largest automobile tille lender in the United States based on title loans receivable.

We principally operntc under two brnnds: TltlcMaxand TitleBucJ.:s. Tit!cMaxrequircs o. minimum o.pprnised Vehicle value of more than 5500 nnd offers interest rntes that we believe,

0648 based on market research, are up to 50% less than those offered by other cornparnble title lenders, TitleBucks provides loans to customers with less valuable vehicles and charges interest rates that are comparable to those charged by competitors for such loans. Tit!cBuck.s was created to capture custonmrs who do not meet TitleMax's minimum vehicle value requirement and who would othenvise use a competitor. We refernon·qualifying customers fromTitleMaxtoTitleBucks when possible.

We also offcra second lien automobile product, with operations conducted within 77TitlcMaxstores in Georgia under the Equity Auto Loun, or "EA.L." brand and through 53 standalone stores in Georgia and Florida under the lnstaLoan, or "JNL," brond as ofDeecmhcr 31 2012. EAL and INLalso offer ll first lien product in certain situations. In addition, EAL and INL sell insurnnce products in connection with their loans as agents for an unaffiliated insurnnce company. The Comnmw is in the process of moving the EAL business into exclusively standalone stores underthe lnstaLo:m brand with separate management and lldditional loan products. As ofDecemher :;1 2012, EA.L and lNLhad appro>:imately S\7.1 million of combined gross title loans receivable, In each of2012, 201 !,and 20!0, 87.4%, 85.8% and 86.1%,rcspectively,ofourinterc~t and fee income was attributable to ourTitleMaxbrand and \1.6%, 13.3% and 13.3%, respectively, of our interest and fee income was ann"butllble to ourTit!eBucks brand. [n each ofthese years, less than 1.0% of our interest and fee incolll¢c was allnDutable to our EALand INL brands.

Tnhlc of Content~ 2012 Highlights We grew our business significantly by opening or acquiring 281 new stores while closing only two stores, representing 3 net increase in stores of36.9% in 2012. Titese new store openings include 46 new JnstaLoan stores that previously operated under the Equity Auto Lo11n brand within Tit\eMaxstores in ~orgia.

We increased our title loans receivable- to SS77.2 million 111 D~ccmher 31 2012, representing an increase of17.8% compared to Deccmher Jl 2()1 I.

In June 2012, we entered into a credit agreement, or the "Cn:dlt Agreemem," to obtain a S25.0 million senior secured revolving credit faci!.ity. In July 2012, the Sole Shareholder made an equity contribution ofSI4.0 million. In November2DI2, our PDrent made an equity contnbmion to us ofS44.8 million.

Gron1h Strategy A key objective of our growth strntegy is to establish a leading position as a title lender in each market in which we operate. The three elements of our growth strntegy are ns follows: Grow Existing Slllrt! Recdvahle.r. Our store title loans receivable lmve grown at a compound annual rate of 19.0% over the first four years ofthe stores' lives and 5.5% thereafter. Originations for2012 increased 26.6% compared to 2011. We be!.ieve there are significant opportunities to grow e:tmings at substantially aU ofoure),jsting stores. Our store managers have a strong incentive to continue the growth ofour stores because they are evaluated nnd compensnted in significant pm1 based outheir achievement ofcertain operating llnd growth seals, which we adjust each year to account for the continued improvement in our business, We believe that by focusing on these specific goals and tying them to employee compensation, we c<~n fun her enhance the operating efficiency of our stores as wclllls overall operating margins.

Open New Stores Witlliu 011r Currmf Foofprlnf.

We seek to develop a large presence in each of the nl."lrkets in which we operate, and we believe we have significnnl room to ~;row by opening additional stores in most oft he matke1s in which we currently operate. Wh~n considering whether we should open new stores in these markets, we e:>amine a numberoffactors, including consumer demand for our products, the t)olent that new stores will be nble to levernge e:cisting stores' m.1rketing effons and the e:dcnt to which new stores might dctrnct from saks from existing stores.

Coutlmu:d E.rpausioulnro Ncwr!r Mflrkr!ts.

We have identified severn\ key geographic arens or m:trkets for the potential opening or acquisition of additional stores. These n~arl\ets were identified following a review of demographics, a dctennination of whether state rcguiMion is fnvornble and an intcm<~l evaluation of each m:trkct's abifity to support our store development pros ram. Based on this re\·icw, we have e).jlanded into rmrkets in ihe southern and west em regions of the United States, including Florida, Arizona and Nevada. As is the case with our strategy to open new stores in our more established market$, we \Jc\ievc we have management and capital resources sufficient to support our growth strategy in our new markets.

Industry Q\'enicw We operate in the alternative financial scrvkes industry, providing: automobile title loans to consumers who own, in most instances, their vehicle free nnd clei\1" and need convenient nnd sin1ple access to funds. Other products offered in this industry include other fonns ofconsumer loans, check cashing, money orders and money tronsfers. Consumers who usc alternative financial services are often referred to as "undcr,5erw:d" or "undcrbankcd" by banks and other trnditional financial institutions. CUstomers use the services provided lly the alternative financial services industry for a variety of reasons, including that they often: do not have access to traditional crcdit·bascd lenders like banks, thrift institutions and credit cnrd companies; have a sudden and une;g~ectcd need for cash due to common finnnciol challenges like medical em::rgencies, vehicle repairs, divorce and job changes; are self-employed smal! business owners with an inuncdia!c need for short·tenn working capital; need a small amount of cash immediately and do not have time to wait fora truditional\enderto approve a loan; and sec such services ns a sensible ahemntive to potentially higher costs and negative credit consequences ofother alternatives, such as overdraft fees, bounced check fees or late fees.

T11hle ofCmuent.~ We believe that the underbanked consumer market, and in particuillr the I!Utomollile title loan segment ofthe ultemative financial services industry, will continue to grow as a result of a diminishing supply of competing banking services forth is segment ofthe population, as well as underlying demogmpl1ic trends, including an overall increase in the population and an increase in tlte numberofself-emp!oyed, sll'l311 business and service sector jobs :~s a percentage ofthe total workforce. We believe automoblie title loans are panicul3rly well-suited to grow in the current regulatory environment of the nnrkiltS in which we opemw, which we view as stable with respect to our loan products :md hostile to other alternative financial services products, such os payday loans.

0649 Scniccs Our automobile title lending business provides a customer who is IS years of age or older (c»:cpt in Alabama where the customer must be 19yenrs ofage or older) with a Joan ranging from S\00 to S5,000 that is secured in most cases by a first lien on the customer's automobile. We detemline the loan amount based upon the customer's need and our appruisal oft he wholesale value ofhis or her automobile, We do not run a credit check on the customer when approving the loan application for our firnt lien title loan product, and performance on the loan does not impact the customer's credit.

Upon approval of a customer's application, we provide the customer with the detemined Joan amount, and the customer provides us with a certificate oftitle to the appraised aUtomobile; however, the customer retains fuU use and possession of! he automobile. We provide our customers with loan funds primarily through the issuance of a check and do not keep a significant amouut of cash on hand at any of our Slores. The customcris able to cash the check at a nearby partnered bank that does not require payment of a check cash~1g fee.

Following our receipt &om the customer of full repayment of the loan, along with interest and fees, we release the lien on the customer's vehicle ttnd return the certificate oftitle to the custo~rur.

!fa customer fails to remit payment to us when due, we ll13Y repossess the customer's automobile. However, we consider the remedy of repossession as a ]HSI res on, and we do not repossess a customer's vehicle unless we have first e*tausted aU options for repayment. As a result, we first undertake to contact the customerto obtain payment. Only if the customeris unresponsive or it is other.vise clear that the customer will not be able to meet his or her obligations will we initiate repossession, A regional or district manager must approve all repossessions in advance, nnd only approved third~party c.ompanies handle the repossession. Even when pennitted by state Jaw, we typically do not repossess a customer's automobile umilthe account is at least 14 days pas! due. Store managers are responsible for arranging vehicle sales. A repossessed vehicle may only be sold to a licensed used car dealer; our employees may not purchase a reposs~ssed vehi<:le. As required by stale regulations in certain slates in which we opernte, we remm any excess proceeds to the customerifthe vehicle sells for an amount in excess ofthe lonn value plus e:q1enses.

We conduct business in Tems and cennin other states through wholly-owned suh~irlinries, each ofwhich is registered in the applicable state as a Credit Services Organiz:stion, or "CSO. "These CSOs have entered into credit services organiz:s.tion agreemems, or "CSOAgrcemcms, "\\ith third-party lenders, or the "CSO Lenders," thntlllllke the loans to our customers. The CSO Agreements govern the tenus by which we perfonnservic~1g functions and refer customers to the CSO Lenders for n possible e:o.1ension of a loan. We process Joan applications and commit to reimburse the CSO Lend em for an}' loans or related fees I hill are not collected from those customers.

Unden1rlting and rusk 1\bnagcmenl AU underwriting decisions related 10 our first lien title Joan product offered by TitleMaxand TitleBucks arc made based on the apprnised "rough" wholesale value of a customer's vehicle, as adjusted by store employees' appraisal ofthe vel1ide based on the following charncteristics: year, m.1ke, model, e:olerior,lnterior and m.::chanicnl condition, nnd mileage. We believe this adjustment process reduces the overall risk ofour til!e loans receivable as compared to other first lien title lenders by having more conservative loan to value 111tios which results in more security for each loan and Jess overaU risk for our romnrmv. Prior to approval, a customer must present the vehicle, alien-free title to the vehicle, a go\'emmenr-issued picture identification and proofofincome (e~ept in Alabama). We verifY that such title is the correct title for the customr::r's vehicle based on a review ofthe vehicle identification number.

Upon completion of the transaction, we send the title to the applicable state Depar1ment ofMotor Vehicles to have ]he C'ompnnv named as the first lien holder for the vehicle. We release !he lien only when the customer's account balance is fully paid.

UndemTiting: of our EALanU fNL title lonn products is based prim.,rily on the customer's credit report nnd the payment hist01y oft he first lien Joan on the vehicle when applicable.

Upon completion of the trnnsnction, we have the C'omnnnv named typicnlly as the second lien holder for the vehicle and we releose the lien only when the customer's account balance is fully paid.

We balance the individual store's autonomy in the underwriting process with a company-wide risk manngement system supported primarily by our district nnd regionnlmnnagers' periodic underwriting reviews and store audits. Undemoriting reviews include a rilndom review of new Joan files and their supporting documentation to con finn the appraisals and related docum.::ntntion adhere to Company policy. Our district managers' audits ofeach store twice per month include document inspection (Iitle, picture, contrnct and key) and n~w Joan r~view (verifying appraisal of vehicles and completeness of files). Further. our regional managers typically spend one day each week with a different district manager to review the undem·riting process and other matters.

Tahle ofC'ontent~ Customers We serve individuals who typicaUy have limited access to consumer credit from banks, thrift: institlltions, credil card lenders and othertraditionalsources of consumer credit. Our typical customers rely on all, or nearly all, oftheir current income to cover inunedinte living e>.penses. Thus, we believe that when une>.pected e~openses ari;e, these customers value the convenient, immediate, simple and transparent access to funds that we provide. In addition, our customers who are small business 01111ers onen use title lending as a source of operating capitnl.

Adl"crtising and l\L1rketing We market our title loans primarily through network television advcnising. Clustering of our stores in g.eographic regions n~1gnifies the effect of our regional television commercials.

Funher, we market title loans through online pay per click programs, billboards, el<:ctronic messtJge centers located in front ofour stores and telemarketing to leads generated through our website. In addition, we create customer loyalty through special ~1centivc programs such as TilUnksgiving turkey giveaways and customer refcrrnl incemive programs. Individual stores employ telemarketing to current and past customers and dismbute flyers to local businesses and apartmcm complexes.

Competition We compete \lith a limited number ofbusines5e$ that exclusively provide title loans, as well as with many providers ofotheraltemntive fi11ancialservices, such as payday lenders, instaUment lenders and pawnbrokers. We believe that the principal competitive factors in the title lo~n industry and the broaderaltemative financial services industry are interest rntes, fees, loan size, location, customer service and conveni~nce. We believe thnt we offer a more affordable alternative to late payment fees and overdmfi fees, and significantly lower annual percentage rates, or ':4PRs." than most other title lenders and other providers ofalternative financial services, such as payday lenders.

We believe that both the title Joan industry and the broader alternative limmcial services indus!!)' in the United Stales me highly frilgnk!nted. Historically, there have been low harriers to entry, ere~ ling fragmentation and enabling small operators to compete with national chains.

Emjioyccs As ofp,•cemher 11 "lOJ') we bad 4,335 employees, comprised as follows: Stores and Field Management 3,949 Corporate 386 Total 4,335

0650 We consider our employee relations to be good. None of our employees are covered by collective barg~ining agreements, and we have nev¢re:qJerienccd any organized work stoppage, strike or labor dispute.

Tnh!e ofCoruents Regulation Our automobile title lending operntions are primArily regulated at the state lc\•el and are subject to laws, regulations and supervision in ench oflhe states in whkh we operate. We nrc also subject to federal and state laws and regulations related to the recording and reporting of certain finaneialtmnsactions and the privacy ofcustorrn!rinfonnntion. The following is a genernl description ofsignificant regulations affecting our nutomobile title lending business.

Slate aud Local Regulatiun E.1ch oflhe states in which we operate has specific state or local licensing requirements appijcable to offering loans secured by title to personal property, wl1ether through a traditional ]o3n, title lonn or pawn tmnsaction. We obtain stat~ or local licenses where required.

We are subject to various state regulations govemil1g the tenru ofthe automobile title loans we offer. Several state regulations limit our recourse ag3inst the customer and the Dmount tho.t we may lend or provide, as wellns restrict the amount of finance orservic.c cho.rges or fees that we may assess and, in r;ertllill situntions, limit a customer's ability to renew any such loans. Forellllmple, we are prohibited from providing automobile title loans in e)l;ess ofS2,500 il1 MissiHippi and Tennessee, and $4,000 in Illinois (under certain circumstanees). In addition, we may not provide on automobile title Joo.n to a customer under the age of 19 in Alabama. In some states, we are required to meet minimum bonding or capital requirements nnd are subject to Vlllious transaction recordkecping requirements. In several snttes, we are subject to periodic ellllmination by state regulators, including e).llmination at the discretion of, nnd without notice by, such state regulators. We must also comply with various consumer disclosure requirements, which arc typically simi!o.r or equivalent to the federol Truth in Lending Acl and corresponding federal regulations. In the states In which we have recourse against the customer for payment of the obligation, our coUection uctivities regarding past due loans may also be subject to consumer debt collection Jaws and regulations adopted by the vnrious states. In addition, we must comply with general consumer protection Jaws in each state, including laws governing the repossession and foreclosure ofco\Jaternl.

Our business operntes under a variety of state statutes nnd regulations, including those rel~ting to: licensinc and posting of fees; lending prnctices, including disclosure requirements such as those contained in sto.tc truth in lending laws and related consumer protection· laws; interest roles and fees; currency reporting; recording and reponing of certain financial transactions; pri\'ncy and data security of personal consumer infom1:1tion; prompt remittance ofe)l;ess proceeds from the sale of repossessed automobiles in cenain states in which we operote; and scn•ing :~s n credit seivices organiz:~tion, or "CSO," in certain states il1 which we may e>;~and our operntions.

In addition to state Jaws and regulntions, our business is subject to various !Oc3l rules nnd regulations such as local zoning regulation und pennit ijcensing. For ex:~mple, the Austin, Dallas, 8 Paso and So.n Antonio, Telllls city councils passed ordinances that restrict e~ensions ofeonsumer credit by title lenders within city limits by, among othenhings, linking ma:..imum al!ow3ble loan size to 3% ofu consumer's gross annual income, mandaling a 25% principal reduction requirement on refinances orrenewals and limiting the tenn ofa loan to no more !han four insta!!ments or renewals. Our subsidiary TitleMo.xofTe:-as, Inc. is challenging the legality oft he ordinances in Austin and DaUos. The Austin, Dallos and San Antonio ordino'lnces went into em:ct on 1v!:w I 2()]2, June Ill 2012 and l:unmN I 201:>, respectively. Wc nrc complying with the ordinances in each ofthese markets. The 8 Paso ordinance will be effective~.

Tnble ofC'onlo:nt~ Federal RcgulatiaiL Our lending activities are also subject to severo] fed em! statutes and reguhllions, including the following: The Dodd-Frank Wall Street Refom1 and Consumer Protection Act, or the "Dodd-Frank Act," and implementing regulations thereunder. which may impact the marketing 11nd regulation of the products and scr\'ices offered by tltc C'ompan\', depending on the e~ent to which the C'ompnnv and its products ond services are ultimately dctennincd to be subject to such Act and regulations. The Consumer Financi~l Protection Bureou, or the "CFPB." wa~ estoblished pursuant to the Dodd-Frank Act os a federal authority responsible for administering and enforcing the laws ;md regulations for consumer financial products and services. Titc Dodd-Fronk Act docs not specifically target title lending,tmditional pavm lending or installment lending for CFPB regulation. However, the CFPB is currently in the process of developing rules that could subject the C'ompnny to some fonn ofregulatory oversight. The CFPB is specifically prohibited from instituting fedeml u~nry interest rate caps.

The G'amnrLeaeh-Biiley Act lind its underlying rcgulntions, which relate to privacy and data security and require us to disclose to our customers our privacy policy and practices, including those relating to the sharing ofa eustorrn!r'S nonpublic person11l infomution witll third parties. This disclosur¢ must occur when esto.blishing the customer rd~tionship ;:md, in some eases, at least annually thereafter. We must ensure that our systems are designed to protect tlte confidentiality of customers' nonpubijc personol infonnation, and we have policies and procedures in p!~ce to address unauthorittd disclosure ofa customer's nonpublic perso1111l information.

The Bank Secrecy Act, or "BSA," as amended by the Uniting and Strengthening An~rica by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, or "USA PATRiOT Act, "which imposes a range of anti-money laundering, or ''AML," and anti-terrorism obligations on covered financi:!l instilutions. As required by tl1e BSA and USA PATRlOT Act, we undertake cemin AMLand nnti-terrorismcompliancc measures, including steps to verify the identity ofourcustorr.crs,and we may be required to employ other measurcs to ensure our compliance with requirements that we report and maintain records regarding trnnsactions that satisfy certain thresho!ds.ln addition, the Office ofForeign Assets ControL or "OFAC," is responsible for administering and enforcing economic lind trode sanctions based on US. foreign policy and national security goals against targeted foreign countries nod reginJCS, terrorists, intemntional narcotics traffickers,those engaged in activities related to the proliferntion of weopons ofrmss destruction and othcrthreats to the national security, foreign policy or economy of the U.S. to insure that U.S. entities do not engage in transactions with

0651 certain prohibited parties, as defined by various E'l!cutive Orders and Acts ofCongress. OFAC publishes, and routinely updates, lim ofnames ofpersons and Of!.lanizations suspected ofaiding, harboring or engaging In terrorist nets, including the Specially Designated N~tionnls and Blocked Persons. If we find ~name on any transaction, account or wire transfer that is on an OFAC list, we must undenuke cenain specified activities, which could include blocking or freezing the transaction requested, ~nd we must notify the appropriate authorities.

11Hl Equal Credit Opportunity Act, or "ECOA," which prohibits discrimination against any credit applicant on the basis ofnny protected category, such as race, color, religion, national origin, sex, marital status, age, whethenhe applicant receives public assistance and whether the applicant has e~rcised a right underthe Consumer O"edit Protection Act. The ECOA requires us to notify credit applicants of:my action taken on the individual's credit application. We must provide a loan applicant a Notice of Adverse Action, or ""NOAA, "when we deny anopplication for credit, which must include, among other things, a statement ofthe ECOA's prohibition on discrimination and an explanation of the applicant's rights under the ECOA.

The Fni.rCredit Reporting Act, or "FCRA," which requires that we give certain no !ices to customers if we deny credit based upon a credit report or offer a customer Jess favorable creditteffil.S based upon information in a credit report. Fmther, the FCRA requires us to implement and foUow a "Rr:d Flags Polley" to detect and prevent identity theft.

The Truth in Lending Act and its underlying regulations, which impose specific requirements on our disclosure to customers ofcredit temlS, including the annual percentage rnte, finance charge, amount financed, to tell of payments, payment schedule, security, late chDtges, prepayment ;md default, related to each automobile title lending trnnsaction.

Fed em! Jaws wl1ich cap the annual percentage rate that may be charged on consumer loans made to active duty military personnel and theirimmedit~te families at 36% peryear. ·n1is 36% ~nnual cap applies to e.utomobile title loans that hrt\'e terms of 181 days or fewer. In addition, we are subject to the SeJVicememhers Civil Relief Act, whiclllirnits the amount of interest we can charge and our right to repossess collateral from military customers.

Tnh[a ofConranlS ITEMIA. RISI<FACTORS.

Our busftwssfitt:l!s a variety ofrlsks and llllcl!rloinl/es, including those described hdau<, t}Jat could materially and adwr.~dy affict our busfness,jinaucial condition and results of operations and could cause acwal rcsulls to diffir materially from our e.r:pectations and projections. You shallld read these risk factors ill conjunction with "}!em 7, Mauagemmt :\· Discussion and Ana(vsts ofFinancial Coudfltou oud Results ofOpcralions" and our cousolidatedfinancial stalemellfs and related notes/// "/tem8. Financial Statenumls rmd Supplemr:mwy Data."

Our imfuslrJ• is strictly regulutetl 111 tfse state,f~:de.rul and loctJifel•ds. Our failure tu comply witII upplicuble laws ami regulutions go1•eruing cotlSIIIIU!r protection, lrmdiug practices am! fll/lcr aspects t~.frmr husiucs~~ aswell us changes in applicable laws and regula/ions, could /lave u j"iguificrmt mfl't!rSe impact 011 our busiiii!SS, resuffs ofopcrutfmu,jiuauciaf condition uud ubi/fly to servlc~ our de lit ollllgatfous.

Our business and products are subject to e:>lensive regulation by state, federal and local governments that do or may impose significant costs or limitations on the way we conduct or C"1Jnnd our business. In general, these regulntions are intended to protect consumers, rather than our investors ot creditors. See "Item 1. Busillcss-Rcgulufion" for a summary ofthe many significant swtc, federal and local laws and regulations governing our business ond industf)', Furthcnnorc,thc laws and regulations covcming our business arc subject to change.

Our failure nrthc failure ofnny of our employees to comply with applicnb!c state, fcdcrul e.nd local requirements, whether vohmtlll)' or involuntary, could require us to discontinue our automobile title lending business in opplicable jurisdictions, which could negatively impact our business. Fnilure to comply with applicable !aw5 or regulations could result in snnctions by regulatory :~gencies, ci\'~ money penallies orrepulational damage, which could Jtavc a material adverse effect on our business, financial eondilion, results ofoperntions and ability to service our debt obligations.

Tile Dodd-Frank Act, a,r well ns potcuJiallcgJs/aliolllll various states Ifadopted, creates significant tmcerlaluty uhout vurinus lmporlnllf aspects ofrmr Jm,ri11es.f.

The Dodd·Frank t\ct that took effect on Julv 21 2010 is c:>lensive and significant legislation that, among other things: creates a liquidation framework for the resolution oflargc bank holding companies nnd systemically significant nonbank fmancial companies; creates a new frllm::work for the re;ulation of over-the-counter derivatives activities; strengthens the regulatory overnight of securities and caJlital markets activities by the Sccmities and E'>l:hange Commi.Hion, or "SEC:'' and creates the CFPB, a new federal authority responsibte for administering nnd enfordng the laws and regulations for consumer ftnmtcial products and services.

The Dodd·Ftank Act will impact the offering, marketing and regulation of consumer fmancinl products and services offered by fmancial institutions, which m:ty include the products and services offered by the tonmanv. The CFPB has supervision, e;G~minntion and euforeenlt!nt authority over the consumer financial products m1d services ofcen~in non-depository institutions, whiclt could include the ('omnan\•. Compliance with the regulations implemented under the Dodd-Frank Act or the ovcr.;ight of the SEC orCFPB ll"'Y impose costs on, create operational constrnints for or place limits on pricing with respect to fmnnce companies such us the Cotm;mv. Until implementing regulntions are issued, no assurance Cllll be given that these new rcquirem:nts imposed by the Dodd-Frank Act \vill not increase our cost of doing business, impose new restrictions on the way in which we conduct our business or add significant operational constr.~ints that might impairourprofitabi!ity. The CFPBalso has the power to define and !J~n "unfair, dec<:plive orab11s1ve" practices in connection with consum::r products, We an:: current!}• fol!owing legislative llltd regulatory developments in ConJ:!rcss and in individual st~tes where we conduct bu.sil1ess. [I is difficult to assess the likelihood of the enactment ofany unf.wornblc federal or state legislation, and there can be no assurance that additional legislative or regulatory initilllives will not be enncted which would severely restrict, prohibit or climinote our ability to offer title loans. Any federal or Stille [egisle.tive or regulatory action that would serve to restrict the types ofactivities in which the Comn~nv is engaged could have a nklterial <tdver.;e impact on our business, prospects, resu[ls of operations, financial condition and cash flows nnd could impoir our nbility to service our debt obligntions and to continue current operations. For cmmple, ccnain consumer advocacy groups nnd fcdcrnl and state les:ishuors have as~crted that laws and regulations should be tightened to severe!>' limit, if not eliminate, the availability of certain consumc:rloan products, including tille loans. Additional possible restrictive actions include, omons: others, the imposition of limits on APRs on consumer Joan transactions or the prohibition of cash advance and similar services. The cncnt of the imp oct ofany future legislative or regulatory chnnges will depend on the nature ofthe legislative or rcs:ulatory change, the jurisdictions to which the new or modified laws would apply nnd the amount ofbusiness we do in that jurisdiction. Moreover, similar actions by states in which we do not currcn!ly opcrntc could limit our opportunities to pursue our growth strategies.

Tahlc ofComcn1~

0652 In addition to state and federal Jaws and regulations, our business is subject to various local rules and regulations such as local :roning regulation and pemlit licensing. local jurisdictions' efforts to restrict the business of alternative fmancial services product providers through the use oflocal zoning lllld pemlitting Jaws have been on the rise. Actiom taken in the future by local govemirlg bodies to require special usc pemlits or ln1pose other restrictions on such lenders could have tl material adverse effect on us. See "Busine:.s-Regularfoll" in Item I ofthis report.

Failure In muiuluiu r:ertuiu criteria required by state ami locul regulatory bodies r:ou!tf result injim:s or rile loss of our liceJtses to conduct busiuess.

1\.fost states in which we opel"ilte requiru lkcnses to conduct our business. These state$ ortheirtespective regulatory bodies have established criteria we must meet in order to obtain, maintairl and renew those licenses. For c~mple, many oftltc states in which we operate require us to maintain a minimum amount of net wonh or equity. From time to time, we are subject to audits in these states to ensure we are meeting the applicallle requirements to nlilintain these licenses. Failure to meet these requirements could result in the revocation of our existing licenses, the denial ofour new licensing requests or the imposition offines, which could adversely affect our results of operations, cllsh flows and ability to service our debt obligations.

We also cannot guarnntee that future license npplicadons or renewnls wiU not be denied. If we were to lose any ofour licenses to conduct our business, it could result in the temporal)' or pe1m.1nent closure ofstores, whiclt could adversely affect our results of operations, cash flows and nbility to service our debt obligations.

Media reports and pttblic perception ofconsumer lou us, suclt as autouwbile title lou us, as beiug predatorjor abusive could tfecrease tlu: demamlfor our mtfomubife ti({c loa us nud lent( to 11wre restrlctlve regulation Certain consumer advocacy groups and federal and state legislators have assened th~t laws and regulations should Ue tightened to severely limit, if not eliminate, the availability of certain Joan produCts, such as automobile title lo3ns, to consumers. The consurner advocacy groups and media repons generally focus on the cost to a eonsumer for this type oflom1, which is often alleged to be higher than the interest typically charged by banks or sirlillar lending institutions to consumers with better credit histories. The consumer advocacy groups and media repons chnracterize these consumer loans as predatory or abusive. Jfthe negative characterization ofthese types ofloans becomes iltcreasingly accepted by consumers, demand for automobile title loans could significantly decrease, which could have a material adverse effect on our business, results ofopemtions, financial condition and ability to service our debt obligations. Additionally, if the negative characteri:mtion ofthese types ofloans is accepted by legislators and re!lulators, we could become subject to more restrictive laws and regulations, whieh could have a material adverse died on our business, results of opemtions. financial condition and ability to service our dl!bt obligations.

Lr!gul proceedings may increase our cm-ts am/ dil1racl our mamrgemtmf teanL In the p~st, we and our competitors have been subject to regulatoty proceedings, class action llnvsuits and other litigation regarding the offering ofaltem~tive fin3ncial services, We are currently a defendant in multiple legnl proceedinss. See •'Jtem 3. /.J!gal Proceedings." It is likely that in the future, we will be subject to curnm!ly unforeseen legal proceedirlgs. The adverse resolution of any current or future legal proceeding could cause us to have to refund fees and interest col!ccted, refund the principal amount ofndvances, pay damages or other monetary penalties or modi!)· or tenninnte our opemtions in certain loca~ state or federaljurisdictions. The defense of such legal proceedings, even if successfuL requires significant tim! and attention ofour senior officers and other management personnel that would otherwise be spent on other aspects of our business and requires the e:-.penditure of substantial amounts for legal fees and other related costs. Settlement oflawsuits nmy nlso result in significant cash payouts and modifications to our operations. Due to the uncertaillly surrounding the litigation process, except for tl10se matters for which an ac:crun! hos been provided, we are unollle to reasonably estimate the rnnge ofloss, ifzmy, at this time in connection with the legal proceedings in which we nre currently involved. An adverse judgn)l;:nt or settlement ofa legnl proceeding may substantially exceed nny amount currently accrued and could have a material adverse effect on our business, results ofoperations, financial condition and ability to sen•icc our debt obligations.

Tnh!e ofContems Judicinl decisium, CFPB mlrNflnkiug or arwmdmeut.~ to tile Ft:dera/ Arbitration Act cotrld render the arbirratiou agreemMfs we use illegal flf twenforceabl~t.

We include pre-dispute ~rbitration provisions in our loan ngreements. These provisions nre designed 10 nllow us to resolve any customer disputes through individ1ml ilrbitr.~tion rather than in coun. Our arbitration provisions explicitly provide that aiJ arbitrations will be conducted on an individual basis and not on n class bnsis. Thus, our arbitration ngreements, if enforced, have the efTect of shielding us from clilss action liability. They do not generally have any impact on regulatory enforcement proceedings.

We take the position that the Federal Arbitmtion Act requires the enforcement in accordance with the tenns of arbitl"iltion agreements contninlng class actio11 waivers of the type we usc. While m.1ny couns. particularly federal courts, have agreed with this argument in cases involving other parties, an increasing number of courts, including couns in California, Missouri, Washington, New Jersey, and a number ofother states, have concluded that arbitration agreements with class action waivers are "rmr:on.rcionable" and hence uncnforcenble, panicularly where a smn!l dollar amount is in controversy on an individual basis.

While the U.S. Supreme Court recently ruled in thcAT&TMobrlay 1'. Concepcion case that consumer arbitration ab'TCements meeting certain specific.1tions arecnforcenble,our nrbitrn.tion agreements differ in several respects from the ngreemcnt at issue in that Cl!Se, thereby potentially limitil1g the: preccdenliol effect oft he decision on ourbusirlcss. In addition, Congress has considered legislation that would scneml!y limit or prohibit mnudatofY pre-dispute arbitration in consumer contmets and has adopted such a prohibition with respect to certain mortgage loans and nlso certain eonsumcrloans to members of the military on active duty and theirdependems. Funher, the Dodd-Frank Act directs the CFPB to study consumer nrbitrntion and report to Congress and authorizes the CFPB to adopt rules limitirlg or prohibiting consuml:!rarbitmtion, consistent with the results of its study. Any such rule would apply to <~rbitration agreements entered into more th<~n six months ai\crthe final rule becomes effective (nnd not to prior arbitration agr<!ements).

Any judicial decisions, legislntion or other rules orregulations that impair our ability to enterinto and enforce pre-dispute consumer arbitration ngreements could significnnt!y increase ollr exposure to cl~ss ~ction litigation as well as litigation in plaintiff~fiiendly jurisdictions. Such litigation could have a material ndverse effect on our business, results of operations, financial condition and ability to service our debt obligations.

Our insumur:e r:o)•crage limit:r may be inadequate ro co1•er ortr liabilities or one or more ofour iusura11ce carriers could tft:jault 011 their obligatious.

As a result ofthe liability risks inherent in our line ofbusiness, we maintain liability insurance in1ended to cover vnrious types of property, casualty ~nd other risks. The types and nmounts ofinsurnnce that we obtain vary from tbne to time, depending on availability, cost and our decisions v.ith respect to risk retention. The policies nre subject to deductfules and C:..I:!usions that result in ourretention ofa level of risk on <1 self-insured basis. Ourinsur.mce policies are subject to annual renewal. Tile coverage limits of our insurance policies m:t}' not be ndequate, and we may notlle able to obtain liability insurance in the future on acceptable temlS or at:~IJ. In addition. our insurance premiums may be subject to increases in the future which may be nl3tcrial. furthermore, the losses that are insured through commercial insurance n.re subject to the credit risk ofthose insumnce companies. While we believe our eo/TliT\ercial insurance providers are currendy credit worthy, we cannot assure you that sucl1 insurance co~nnies will remain so in the future. Inadequate insurance covernge limits, increases in our irlsurance costs or losses suffered due to one or more of our insul"ilnce carriers defaulting on their obligations, could have a material adverse effect on our financial condition, resu!!s of opemtions and ability to service our debt oblig:~tions.

A significant portion of our revetme is generated by our stores in Georgiu, Alubnma, Tt!tme.fsee ami Sullfll Curoli11n.

Appro»mately 28%, 12%, 11%and 8% ofour stores are located in G!orgia, Alabama, Tennessee and South Cnrolina, respectively, which accounted forapprOllimately 36%, 16%, 13% and 13% of our revenue, respectively, for the ycnr ended Decgrnhcr 31 2012. As n result, ifnny ofthe evenls noted in these risk factor.s were to occur in these states, including changes in the regulatOI)' envitonment or worsening of economic conditions, it could significllntly reduce our revenue and cash flow and could hal'e a material adverse effect on our business, results ofopemtions, financial condition and ability to service our debt obligations.

0653 Thhls ofContent~ !jwe lose key 1/I«Jlllgtllll!llt or are tmahfe lo attract a11d retain qua{itJ• management tale/It, we mny be unable to pmfllably operate nml grow our business.

Our continued growth and future success will depend on our ability to retain the members of our senior managemc:nt team, who possess valuable knowledge of, and experience with, the legal and regulatol)' environment of our industl)' and who have been instrumental in developins ourstmtesic plans and procuring capital to enable the pursuit ofthose plans. The lass of the services of members ofsenioimaMgement, together with any inability to attrnct new skilled ffi!lnagement, could hnm1 our business and future development.

T!Jt./1/teres/s ofour Parent's sole benejidal owtter may be lliffaeut til au those ofrmr iuves/ors.

Tmcv young is our founder, Olllinnan of the Board, 0JicfE.'IJ!cutive Officer, President and the sole bcnefidalownerofourparent holding company, TMX Finance Holdings Inc. As a result, subject to the !imitations in the agreements govemi11g our indebtedness, including the inrlsntnre governing our senior secured notes, or the "lml!!lllllr>! "Mr. Young has the ability to control substantially all matters of significance to the Comnanv, including the strntegie direction of our business, the election nnd removnl ofthe manager.; ofTMX Finance LLC, the appointment nnd removal of our officers, the approval or rejection ofa sal.:, merger, consol.idation or other business combination, the issuances ofadditional equity or debt securities, amendments ofour organililtional documents, the entering into ofrelated party transactions and the dissolution nod liquidation ofthc Comnmw, regardless ofwhethcr the holders ofthe senior secured notes, or our "bondholders," believe that any such action is in their best interests.

As a result ofMr. Young's complete beneficial ownership and control ofourConmnnv his Interests could eonlliet with the interests of our bondholders. For C}.llnlple, if we encounter financial difficulties or are unable to pay our debts as they mature,l\k Young's interests as the sole equity ownerofour Parent might conflict with the interests ofour bondholders.

Mr. Young might also have nn interest in pursuing transactions that, in his judgment, could enhance his equity investment, even though such tmnsactions might involve risks to our bondholders. In addition, Mr. Young could cause us to m.1ke acquisitions that increase the amount of our indcbtcdness or sell asse1s, either of which 1t1J1Y inlPairour ability to nuke payments under the notes.

Economic rcct!SSlon, 111/CI/Jflloyuumt 1111d other factors could result in« reduct/oil i11 denmndfor our products and services, om/ we lilt/)' /Je 111/rtblc 111 mlnpt to any sucfl retfuclion.

Factors that influence d~mand for our products and services include macroeconomic condilians such as employment, personal income n.nd consurnerscnliment. If consumers be eo me more pessinlist(e regarding the outlook for the economy nnd therefore spend less and save more, dcoond for title loans may decline. In addition, weakened economic conditions n\ily result in au increase in loan defaults and loan losses. We can give no assurance that we wi!l be able to sustain our current chargc-offmtcs orlhot we will not e),Jlerience incrtasing difficulty in collecting defaulted loans. Further, in an economic slowdown, we could bc required to tighten our underwriting standards, which likely would reduce our loon bolonecs.

Should we foil to adapt to any significant declines in consumers' demand for our products or services, ourrevenues could decrease significantly and our opemtions could be htmned.

Even if we do make changes to existing products or services or imroduee new products or services to fulfill consumer dcm:md, consumers may resist or may reject such products or services.

We r1rc subject to 1/nhiliticsfor clnims rclrturl tu repossesslol! ofrmwmnhilcs.

We use Ucensed third·porty providers in connection with the repossession of defaulting customers' automobiles, We typicaUy enter into ngrecments with these providers in which they indemnifY us for all losses related to claims arising from a repossession :md warrant that they maintain insurance sufficient to cover such claims omd indenmilicatian obligt~tions; however, we do not enter into these agreements with every third-pat1y provider. We are subject to the risk that any thirU-pany provider that we use nmy not have sufficient insumnce to cover such claims or indemnification obligations. In such event, we may be subject to claims ofcustomers related to repossession, which could have an adverse effect on ourb\tsiness.

Tnhlsoflonten!~

DismptiOilS in tile credit ami cnpitalmarkcts cottld negatively impact tlte availahility amf Cll.1·t ojborrowfug.

Borrowed funds represent o significnnt portion of our capitol. We rely on borrowed capital, together with t:lsh flows from operations, to fund ourworldns capital needs, including making title !arms, Disruptions in the credit and cilpitnl tn11rkets, such ns those e),Jlerieneed in 2008 :~nd 2009, could adversely <~ffect our ability to obtain c11sh to m.'\ke title loons and to refinance existing debt obligations. Efficient access to these malkets is critical to our ongoing financial success; howe,•er, our future access to the credit and debt capital markets could become restricted due to a variety of factors, including a deterioration of our ean1ings, cash flow, balance sheet quality or overall business or industry prospects, a sust11ined disruption or fintlterdeterioration in the state of the credit or capital markets or a negative bias toward our industry by m:ukct participants. Our ability to obtain additional financing in the future will depend in part upon prevailing credit and capital mmkets conditions. The credit and capital markets are volatile and n decline in those markets m1y adversely affect our efforts to arrange additional financing on satisfactory term<;, If adequate funds ore not available on acceptable terms, we may not be able to make future title loans, lake advantage of acquisitions or other opponunities or respond to competitive challenges.

Cilauges ill credir ratings issued hy .flaristica/ ralillg nrgunirarloi/S could adversely offecl ourctrsts offinancing.

Credit mting agencies rote our indebtedness based on factors that include our operating results, actions that we take, their view of the general outlook for our induS\!)' and their \'icw ofthe general outlook forthe economy. Actions taken by the mting agencies cnn include m.1intaining, upgrading or downgrading the cttrrent rnting or placing us on :a milch list for possible future downgrading. Downgrading the credit rnting of our indebtedness or placing us on a watch list for possible future downgrading could limit our ability to access the capital markets to meet liquiditY needs :md refinance maturing UabilitiC:s or increase the interest rates and our cost of financing.

Tile lml!!nlflr<' nud Credit Agrccmellt impose .~ignijicanf opcrnlilll: nnd jimmdnf restrlcficms, w/llcilmay prevem us from pursuing certaill htu·Jucss opparlsmilies awl taklng ccrtafu actions.

The lmlenture and Credit Agreement impose, and future debt agreements may impose, operating and financial restrictions on us. These restrictions limit or prohibit, t.mong other things, our ability to: incur additional indebtedness unless certain financial tests are satisfied; issue disqualified capita! stock; pay dividends, redeem subordinated debt ormke othcrrestricted payments; m.1ke certain investments or acquisitions; issue stock ofsuhsic!i~rie!>;

0654 grant orpemlit certain liens on our assets; enterinto certain transactions with afftliates; merge, consolidate or transfer substantially all of our assets; incur dividend or other payment restrictions affecting cenain of our suhsjdinries; trans fn, seU or acquire assets, including capital stock of our suh~idinrics; and change the business we conduct.

These covenants could adversely affect our ability to fmance our future operations or capital needs, withstand ll future downturn in our business or the economy in general, engage in new business activities, including future opportunities that may be in our interest, and plan for or react to market conditions or otherwise e~cute our business strntegies, A breach of any ofthese covenants could result in a def.1uh with respect to the related indebtedness.Jfa default occurs, the relevant lenders or holders of such indebtedness could elect to declare tlle indebtedness, together with accrued interest and other fees, to be immediatdy due and pnyab!c and proceed against any collaterol securing that indebtedness. Accclerntt'on ofour other indebtedness could result in a defaull under the tcnns ofthe Jn.d.sn..t.urs and Credit Agreement.

Tt~b!e off'ontenl~

Compr!tltlonln lflf!jimmr:lnl Sl!n•lces lmfusfry cmlltl en use us to lost m11rket sllare am/ rel't/11/f!S.

The industry in which we opernte has low barriers to entl)' and is highly fragmented and very competitive. We cncoumer significant competition from other automobile title lending companieJ, pawnshops, installment lending companies, online !~nders, consumer finance companies and pmviders of other forms: of alternative financial seJViccs, many of which have significantly greater financial resources than we do. Significant increnses in the nun1ber orsiZI! of competitors or other changes in competitive infiut.•uces could cause us to lose market share and e:.perience slowi11g or declining revenues, thereby affecting our ability to generate sufficient cash flow to fund our operations and service our indebtedness. We cannot assure you that we will be able to compete successfully wi!h ourcompeti!Ors.

Competition form1rl:ct share will likely intensify. Increased competition could lead to consolid11tion within the indus\!)'. If our competitors get strongerthrough consolidation and we are unable to idcutify attractive consolidation opportunities, we could be at a competitive disadvantage and e"Jlerience declining market share and revenue. lfthese events nuterialize, they could negntivcly affect our ability 10 gcnemte S11fficicnt cash flow to furtd our operntions and service our indebtedness.

In addition to increasing competition among tmditionol providers ofaltemative finnncial services to consumers, there is a risk oflosing market share to new market entrants such as banks and credit unions. Sevemllarge finnncial institutions have introduced payday·like products in the last few years. Broad consumer adoption ofthese alternatives could reduce the number ofloans we IWlke and adversely nffect our cash flows.

Our growth stmtcgy cnlls for opening additional stores, both in states in which we cum:nt!y operate nnd stutcs into which we arc looking to e"JJand. If our competitors aggressively pursue store e:q>ansion, competition for store sites could result in a failure to open the planned number ofstores and could result in increased costs to procure desired locations, both of which could impairourrcsults ofopcrations.

E:aemn/ fuctllrS amf other circumsialt~·es over wflicfl we lw!•c llmltct! Cflllirol "' tlwt ttrc !Jcyfll!d fntr cmltral could ndver,rl!fy affect our abili(l' to grow tltrouglt tf1c opening ojuew stores.

Our.:::q>ansion strategy includes opening new stores. The success ofthis strategy is subject to numerous e~emol factors, including, but not limited to: the avai!nbility ofsites with acceptable restrictions and suitable temt5; our ability to attract, trnin and retain qualified store IMnagement personnel; our abtlity to access capital; ourabiUty to obtain required government petmits and licenses; the prevaitin~:t laws and regulatory environment of each state or jurisdiction in which we operate or seek to operate, which nrc subject to change at any time; and the degree ofcompetition in new markets and its effect on our ability to attract new customers and our ability to ad:tpt our infrastructure and systems to accollUllOdate our growth.

Some ofthcse factors arc outside of our control. The failure to e;.l!cute oure"Jlansion strategy would adversely affect our ability to c:q~nnd our business and could mntcri3lly adversely affect our business, results ofoperations, financial condition and :~bi!ity to seJVice our debt obligations.

Our al/owmu:ejor louulosses uud our accrual for tosses Ol/{(1(11/$ we process awl guaruutcejar ttl/ tmconsolidatcd tllfrd·partj' fender ure ouly esti11U1ies am/may /lot he adequate to fitiiJ• ab.wrb lom:s.

We nDintain <~n aUow:~ncc for lo:tn losses for cstin'l3ted probable losses on our title loans. We also maintain an accrual for losses rel3ted to loans we process fornn unconsolidated third-party lender that we guarnntee, See "Item 7. Manogemr:nt ~Discussion and Analysis ofFillallciol Conditi011 ami Rc:sulls ofOpcratiom-Critical Accarmtil!g Policlc:.f" for factors considered by management in estimating the 111lowance for Joan losses and accrual for losses related to our unconsolidated third·party lender. These rcser\'es arc cstinmtes, and ifac!ua\ losses are greater than our reserves, our results ofoperations and finanei~l condition could be adversely affected.

" Tahle orloutent~ Our busiuess and results ofaperatioiiS 1/UIJ' bl!. Uflversely «ffictc:d ljwe ure rmabfc Ia 111111/age our ;:rowtlleffictivefy.

There can be no assurance that we will be able to continue to grow our business or that our current business, resJJ!!s of operations and fin3nti.11 condition will not suffer if we fail to pmdently n~1nage our gro\~1h. Failure to grow the business and generate estimated future h:vel.~ of cash flow could inhibit our ability to service our debt obligations. Ourc:q~ansion strategy, which contemplates growing our title loans receivable in eiliting stores, openinc new stores in existing markets and opening new stores in new markets, is subject to significant 0655 risks, Our current business and results of operations :md any futuro srowth depend upon a number offactors, including the ability to obtain and maintain financing to support these opportunities, the ability to hire, train and retain an adequate number ofqualified employees, the ability to obtilin nnd maintain any required govemment peunits and licenses, the abi~ly to successfully integrate ;my acquired operations as well as other fnetors, some of which arc oUiside of our control, such as the continuation offavorob!e regulatory and legislative environments. Further, e:-pansion Into additional states will increase our regulatory and !egltl risks. Regu!atOI)' and legal actions could divert management's attention away from eM!euti:ng our growth strotegy. The profitability of our current operations could suffer as management's attention is di\•erted toward our c:-.pansion plans.

Ifwe are /lot .mccessjitl at entering new brtslucs:us or hromfeniJJC tire scope ofour existing product aud .rervicc offerings, we may uat achieve our expected growth rule or recoup our im•csmwnt, We may enter into new businesses that ore adj~cent or complementary to our e:>.i.sting businesses and that broaden the scope of our e:dsting Product and service offerings. We may not achieve our e:q~ected growth if we are not successful in these efforts. In addition, entering into new businesses and broadening the scope of our e:-isting product and service offerings may require significant up front e:o.penditurcs !hat we may not be able to recoup in the futuro. These efforts may also divert management's attention and c;qJose us to new risks and regulations which rroy have a material adverse effect on our business, results of operations, financial condition and ability to service our debt obligations. /11 certain .~tateJ; we re/;• on tilird parties to II IItke loans tf1 tlllrcu.~tonurs, and the loss of access to UltJ' ojtflese tfllrd partie~ could slgulflcontly it1cren.ff! our casts and change the way we operate in tltese states, In cenain states, particularly including Tel\!ls, we operate as a Credit Services Organization and therefore :ltT<lnge for an unrelated third porty to JMke loans to our customers. There arc a limited numberoflhird pnllies that make these types ofloans, and there is significant demand and competition for the services oftilesc third parties. Titese third pnrties rely on boJTowed fonds in order to tnilke consumer loans. lfthese third panics Jose their abWty to make loans or become unwilling to mnke loans nnd we nre unable to find another lending pl1t1ner, our cost of am:mging loans in these states tn3y increase significantly and we could be forced to change the way we operate in these states, wl1ich may l1ave a material adverse effect on our finaneinl results, make it difficult to opcrnte profital:lly in these locations and negatively affect our ability to service our debt obligntions.

Tile lack ofavailability ojun adequate mrmher afltour/y employees to T/111 our business cn11flf negativcly impact our growth, mul any increases in Wtlges, benefits or rltltu cosu· associrrtclf will/ llollrly employees could signljicautly increase our labor co.rls.

Our workforce is comprised pnhmrily ofemployees wbo work on an hourly basis. In certain ure:~s where we opernte, there is significant competition for employees. The l:tckof avnilability ofnn ndequate number ofhourly employees or an increase in wages nnd benefits to current employees could adversely affect our business, results of operations, cash flows, financial condition and ability to service our debt obligntions. We ore subject to applicable rules and regulations relating to our relationship 'vith our employees, including minimum wage nnd break requirements, health benefits, unemployment and sales tax::s, O\'enime und woricing conditions and inlJnigration status. Accordingly, legislated increases In t\1e federnl minimum wage, as wei) ns increases in ndditiom1llabor cost components such as employee benefit costs, workers' compensation insurnnce rntes and compliance costs and fines, would increase our labor costs, which could have a material ndverse effect on our business, prospects, results of operations :'lnd fin:mcial condition.

Tnhle ofConl¢0!« Any disrup/iu/J ill t!Jc availability or security ofour iujormatiou .fJ'Stems co1tlri cuuse us to rose customers and revenue, subject liS to signljicuuf liability and cause us tu incur slgu/jicam c:xpensc, We ruly heavily upon our infommtion systems to process customer loan tmnsnctious, account for our business activities tmd scnernte the reporting used by mwagemcnt for analytical and decision-m"llcing purposes. Bleh of our stores is part of an integmted dota network designed to facilitnte underwriting decisions, reconcile cnsh bnlnnces and report revenue and e:q~ense transaction data. Our back-up system> and security measures could fnilto prevent a disruption in the nvnilnbi~ly orperfonnance of our infomllltion systems. Any disruption in the availability or perfommnce of our info mullion systems could significt~ntly disrupt our operations and cause us to lose customers and revenue. Fut1hcr, a security breach of our information systems Could n!so interrupt or damage our operations or h:mn our reputation, We could be subject to liability if confidential customer information is misnppropriated from our information systems. Despite the implem:ntntion ofsignific:mt security m:nsures, our infonnation systems may still be vulnernble to physical break-ins, computer viruses, programming errors, employee misappropriation and attacks by third panics or similar disruptive problem>, which could ...-:quire us to incur significant e;-.pense to eliminate these problem> and address related data security concerns.

We /lUI)' be mmblc to prtJtcct our prnprh.!tary tcc/uwfogy or keep up witfl tlrat 11jrmr competitors.

The success of our business depends to a significant desrce upon tile protection ofour software and other proprietuY inteJJectuoJ property rights. We m.1y be unable to deter lnisappropriation ofour proprietary info1Tl111tion, detect unauthorized usc or take appropriate steps to enforce our imdlectunl property rights. In addition, competitors could, without violating our proprietary rights, develop tcehnolollies thot are as good as or better than our technology. Our failure to protect our software nnd other propriCt:!.t)! intellectual property rights or to develop technologies that are as strong as our competitors' could put us at a disadvantage to our competitors. Any such failures could have a material adverse effect on our business, prospects, results ofoperations, financinl condition nnd ability to service our debt obligations.

Our business may .mffer ifour trademarks Qr .tcrvicc mnrks nre iJJjri11ged.

We rely on trademarks and service marks to protect ourvan·ous brand names in our markets, Many ofthcsc trademarks ond scl'\·fcc marks have been il key part ofestablishing our business in the conununities in which we opcmte. We believe these trademarks and service tnurks have significant value nnd are imponnnt to the nurketing of our services. We cannot assure you that the steps we have taken or will take to protect our proprietary rights will be ndcqunte to prevent misnpproprintion of our rights or the use by others offeatures based upon, or other.viie sinilnr to, ours. Jn addition, nlthough we be~eve we hnve the ri_gilt to use our tradem.1rks and service marks, we cannot nssure you that our trademarks und service marks do not or will not violnte the proprictnry rights of others, thnt our tmdelll!lrks .!l.nd service marks will be upheld ifchallen{!ed or that we will not be prevented from using ourtmdenwks and service marks,any ofwhich occum:mccs conJd hannourbusincss.

Adverse re11! cstrrte marketjluct:mtio11s could affect Qllt profits.

We cumntly lease all ofour locations c;.x:cpt one. A significant rise in real est~te prices orreol property ta:-a::s could result in an increase in store lease costs as we open new locations nnd renew lenses forcJ>lsting locations. Any such increase, especially in Georgia, Tc~s. Alabama or Tennessee, could have a rnaterial adverse effect on onrbusincss, prospects, results of operations and financial condition.

Our husiuess is seasonal, wllicll causes nur revenues to fluctuate and uwy adversely affect our ability tu ser.•lce our debt.

Our business typically declines slightly in the first quaner as a result ofcustomers' receipt of tax refund checks. Demand for our services is generally greatest during the fourth quaner. This seasonality requires us to manage our cash flows over the course ofthc year. If the state or federal sovcmmcnt were to pursue economic stimulus actions or issue ltdditional tax refunds or tnxcrcdits :!.I other times during the ycnr, such actions could have a material adverse effect on our business, prospects, results ofopemtions and financial condition during those periods. Jf ourrevenues were to fall subst<mtially below wh:~.t we would nonnally C:.;JCCt during certain periods, our annual financial results would be adversely impacted and our nbility to service our debt may also be adversely affected.

0656 Tnh!e ofCnntents Our substantial lew!! ofindebtedness coulrf advcr.rdy a.ffict our jillaltcial COIIditiou and prevent rtsfromjiiljil/ing our obligatio/IS 1111dcr tlte senior Stcllri!rl notes.

We have substantial indebtedness. As of December 1! "'0! '), TMX Finance LLChad appro>.imately $370.5 million of total debt outstanding. Subject to re~trictions in the Indenture we 'ttla}' incur additional indebtedness.

Our substantial level of indebtedness could have important consequences to our bondholders and significant effects on our business, including the following: it may be more difficult for us to satisfY our financial obligations, including with respect to tlh! notes; our ability to obtain additional financing for working capital, capital expendilUres, strategic acquisitions or general corporate purposes may be impaired; we must use a substnntial portion of our cash flow from operations to pay imerest on the notes and our other indebtedness as well as to fund excess c~sh llow offers on the notes, which will reduce the funds available to use for opemtions and other purposes; our ability to fund a repurchase ofour outstanding senior secured notes upon the occurrence of a change of control of! he C'.omQilnv or other event as specified in the ~may be limited; our substantial level of indebtedness could place U$ nt a competitive disadvantage compared to our competitors that rnay h:tve proportionately less debt; our flc,jbiJity in pl~nning for, or reacting to, changes in our business and the indusuy in which we operate mny be limited; and our substanti~llevel ofindehtedness may make us more vulnerable to economic downturns and udverse developments in our business.

We e;-.pcct to obtain the funds to pay ourc1>pcnses nnd repny our indebtedness primarily from our operations and, in the case ofour indebtedness, from n refinatlcing thereof. Our ability to meet our e;q>enscs and 111<1ke these payments therefore depends on our future perfomumce, whkh will be affected by fmancial, business, economic and other factors, nnny of which we cannot control. Our business may not generate sufficient cash llow from operations in the future, and our currently onticipated growth in revenue und c~sh flow may not be n:alizcd, either or both of which could result in our being unable to repny indebtedness, including the notes, or to fund other liquidity needs. If we do not have enou,gh funds, we may be required to refinance all or part of our then existing debt, seU assets or borrow more funds, which we may not be able to accomplish on tenns accept~ble to us, or at aU. Jn addition, thetenns of existing or fi.ume debt agreements moy restrict us from purnuing nny oftl1ese alternatives.

Despite tmrcurrcut imlcbtctlllcss lcL•cl, we tnuf any ofour e.-.lstlug or jiuurc ~uh.tillinrirs IIUIJ' stilll1e able to fllcur substantially mare debt, wllich cau/lf cxacerbMe tlte ril·ks associated with our :mhstallfiallevemce.

We and any ofour existing and future suhsirlimic~ mny be able to incur substantial additional indebtedness in the fnture. Although the terms of the hulctunre contain limitations on our abillly to incur addi!iono.l indebtedness, these restdctions arc subject to a number ofqualifications and e>a:eptions. lfwe incurnny additional indebtedness that ronks equally with the notes, the holders oftho:~t additional debt will be entitled to share ratably with the holders oflhc notes in nny proceeds distributed in connection with ony insolvency, liquidation, reorganization, dissolution or other winding up of the C'onmnnv, subject to nny collateml securing the notes. If new debt is added to our or ony ofour existing and fitture suhsjdinne~' current debt levels, the related risks that we now face could be eXDcerbated.

ITEM 1 B. UNRESOLVED STAFF COfrlMENTS.

None.

Ti!hlc of Content; ITEM2. PROPERTIFS.

Our stores ~;encmlly range in size, from appro:li!Tllltely 1,800 to 2,,100 square feel. Most of our stores arc located in highly visible, accessible locations with ~rterial roadways that we believe have high daily traffic volume and high r;:oncentration of retail us em, typically with retnilers serving eomparnble customer bnses such as national auto parts and rcnl·to-own companies. We prefer our stores to be freestanding. single tenant buildings, but we also use retail strip shopping center stores, preferably on iln end unit or with a bay with high rand visibility, We believe that our stores provideD welcoming, peisonal environment for conducting our business ..

All but one of our stores arc leased, with typical lease tenns of five years and two options to renewal the end ofthe lease. with an average gross monthly rent ofS3,SOO. Our !eases usually require thilt we pay aiiiTlllintenonce costs, insurance costs and property ta»::s.

The following table shows the composition ofour store network at Dccemher~l 2012: Sl~re Coun1 AlabaiTlll 124 Arizona 62 Florido 2 Georgia 290 Illinois 48 Mississippi 3 Missouri 67 Nevada South Cnrolino Tennessee " Te»!S 161 Virginia 62 Total 1,035 We believe that our facilities, equipment, furniture and fuiures are in good condition and well maintained and that our fucilities ~re sufficient to meet our present needs.

ITEM3. LEGAL PROCEEDINGS.

0657 We nrc involved in a number ofat:tive lnwsuits, in.duding the legal proceeding discussed below as well as a numberofroutine litigation and administrntive proceedings arising in the ordinary course ofbusiness. Due to the uncertainty surrounding Ute litigation process, except for those tt1.1tters for which an accrual has been provided, we arc unable to reasonably estimate the probability ofan unfuvornble oulcome orthe range ofloss, if~ny, at this time in connection with these proceedings. While the outcome of many ofthese matters is currently not detenninable, we believe we ln1ve meritorious defenses to the claims in these proceedings and that the ultimate cost to resolve these matters will not have a materially adverse effect on our consolidated financial position, results ofoperations or cash flows.

Ju.rtiu Jolmsou, ct a/ v. TltldftJ.t o[MISS(IIlrf, 11/c, (/lkla Mig11011 Norfolk, rt at v. TilltMa:>: ofMissouri, Juc.)

On F~lml~rv 10 201 I, Mignon Norfolk filed a putative class action lawsuit in the Circuit Court of Jefferson County, Missouri against Titler..·la>::ofMissouri,Inc., or "TMM. "and n TMM District Manngcr. On Julv "'l7 "'JQ]'l, the nnmcd plaintiff changed from Mignon Norfolk to Justin Johnson. TI1ecomplaint alleges, among other things, that TMM failed to pay cerlnin employees overtime compensntion as required by Missouri !11w. The pl~intiffseeks, among otherthing:s, a judgment for an amount cqunlto plaintiff's unpaid compensation, as well as liquidated dam.1gcs. The litigation is currently in the discovery phase, and it is too early to detennine the likelihood of an unf.,vorable outcome or the ultimate liability, if any, resulting from this action, ITEM:4. J\.1INESAFEJYDISCLOSUIUS.

Not applicable.

Tah1<! ofC'ontent~ PARTD ITfhiS. MARKET FOR REGISTRA!\'T'S COi\1\tON EQUITY, REI.ATJID STOCKHOLDER MATIERS AND ISSUER PURCHASES OFEQUITYSECURITIES.

Trncv Young, the founder, Cl!ainmn of the Board, OtiefE'>l!cutive Officer and President ofTMX Finance LLC, is the sole beneficial ownerofthe common stockofTMX Finance Holdings Inc., which owns all IOOofthe outstanding limited liability company interests in TMX Finance LLC. There is no established public trading market for common equity ofTMX Fin11nce Holdings Inc. orTMX Fin11nce LLC. For information about cash dividends paid by TMX Finance LLC for the past two fiscal years (including certnin restrictions that limit the p11yment of dividends), see "ltem 7. Managcme111 ',f Dlscu:rsion and Analysis ofF/nanclal Condition and Resu/Is ojOpermlons-Lfquidlly and Copflal Resourus."

ITEM6.SEUi'£TED CONSOLIDATED FINANCIAL DATA.

The following lilble sets forth se!et:ted historicul consolidated fmoncinl data for the C'nnmanv as ofond for the fiscal years ended Decemtl!'r :II 201J, :m1 l, 2illQ, 2002 and ZlJ.!la. The fimmci~linformation for the years ended Dgcs:mh,•r ill "'lQJ"'l lQ.U and 2Qill, and as ofPcq·n~Htf :It 'l01' and 2!!l.L has been derived from our audited finnncinl statemc:nts included elsewhere in this report. Tite financial infom1ntion for the yems ended Decemhcr l I '009 and m, flnd as ofDccemher 31 '010 '009, and 200R, has been derived from our audited finoncio[ statements not included in this report.

The historical selected financial information may not be indicative of our future performance 11nd should be read in conjunction with the information contained in "Item 7.

A.fanagtment S Discussio11 and Analysis o[Fii/OIIcfal Condifton and Resulu· ofOperallon.~" and the consolidated fmancial statements and related notes in "/!em 8. Fimmcfal Statemrm/s oml Supplementary Data."

Ye~r fnded Decemb~r Jl. in rhous:>nds 2012 21HI 2010 2009 2008 Stnlcments of Income Data: Interest and fcc income s 656,755 s 505,865 s 389,449 s 312,022 s 262,635 Provision forloan losses (144,749) {99,54:2} (63,932) (51.184) (45.3\8) Net interest and fee income 512,006 406,323 325,517 260,838 217,317 Costs, expenses nnd other: Salaries and related expenses 201,899 159,201 116,090 90,234 78,046 Occupancy costs 64,727 48,556 34,939 33,366 32,698 Depreciation ond nmortiz.:uion (I) 17,210 13,813 10,353 9,0'17 8,670 Advertising 22,217 15,512 10,243 6,206 13.242 Other operuting and administrative e:q:!enses 77,469 58,6% 41,407 33,720 30,345 Interest e:>:pense. net (2) 49,293 42,610 26,251 11,674 13,286 Total e:-.pcnses 432,825 338,388 239.283 \84,227 176,287 Income from continuing opemtions before reorganimtion items 79,181 67,935 86,234 76,6\1 4I.030 Reorganimlion items (3) 4,548 6,655 Income before discontinued operations 79,!81 67,935 81,686 69,956 41,03[) (Loss) gain from discontinued operations (4) 145 (2,1841 Net income 79,181 67,935 81,686 70,101 38,846 Net income (loss) <~ttn'butable to noncontrolling interests (1,627) (1,906) (4.031) (1.977) Net income allributable to member's equity s 79,162 " s 69,562 s 83,592 s 74,132 s 40,823

Tnh!e ofC'nntent~ Y~~r Ended December Jl. in lhauuntls ~012 2011 2010 201)9 2008 Non-GAAP f1nancial Measures (5) (unaudited):

0658 Net income s 79,181 s 67,935 s 81,686 s 70,101 s 38,846 Interest e;..pense, net 49,293 42,610 26,251 11,674 13,286 Taxes 948 1,917 756 13 Depreciation and amonization 17,210 "' 13,813 10,353 9,027 8,999 EB!TDA s 146,632 s 124,996 s !20,207 s 9!,558 s 61,144 n~ccrnb~rJl.

In lhouu.ndl 2tlll lOll 2010 200~ 1008 Dal:mce Sheet Dnto: Cash and cash equivalents s 90,794 s 38,141 s 53,585 s 27,008 s 10,18& Title loans receivable 577,172 490,093 360,325 282,917 232,450 Allowance for loan losses l94,561) (73,103) (52,0-18) (40,280) (29,885) Unamortized Joan origination costs 3,7L6 2829 2,139 1,160 1,251 Title loans receivable, net 486,327 419,819 310,416 243,797 203,816 Tota1assets 767,783 604,748 470,331 338,763 283,648 Total debt 395,454 346,054 273,401 178,353 193,884 Total liabilities 456,795 408,410 329,195 207,489 208,550 Member's ~:quity 318,365 202,484 145,876 133,198 73,904 Member's equity and noncontrolling interests 310,988 196,338 141,136 131,274 75,098 Statement of Cash FloiVD:tla: Net cash provided by operating acti\'ities s 222,321 s 175,159 176,211 s 144,225 s 105,208 Net cash used in investing activities (254,528) (246,453) ' (154,651) (95,%4) (75,(20) Net cosh provided by (used in) financing activities 84,860 55,850 5,017 (31,441) (28,120)

(I) Represents de,neciation and an10rtirntion ofproperty and equipment. (2) Includes amortization of debt issuance costs and discount/premium of$3,481, 53,633, S2,035, $1,210 and S3,144 for the fi.~cal years ended December J 1 2012, 2011, 2010, 2009 and 2008, respectively. (3) Reorganization items rcfc::rto c:qlenses incurred in connection with our reorganization pursuant to Otapter 11 of the U.S. Bankruptcy Code. See Note 16 of Notes to Consolidated Financial Stll\cmcnts in "/lcm8. FlnarJcia/ Stalemcmsand Supplemelllazy Data." These items include professional fees and interest earned on accumulated cash resulting from the Otapter ll proceeding. (4) References to discontinued operations relate to payday~1ending ~uh~irliprie.o: that were discontinued in April2008 and had no activity in the fiscal years ended necemher 31. 2012, 2011 or20IO. (5) We disclose our earnings before interest e;..pense, t~.>a!s, depreciation nnd amortization, or "EBJTDA," which is a "nori·GtlAP financial mcm'llfc" as defined underthe niles of the SEC. 11 is intended as a supplemental nlllosure of ourpcrfoml.llncc that is not required hy, or presented in llcconlance with, U.S. generally accepted accounting principles, or "GAAP."

We present EBITDA because we believe that, when viewed with the Comrmnv's Gt\AP results <:~nd the accompanying reconciliation, EB1TDA provides usefulinfonnation about our operating perfonn:tnce and period-over·period growth, as well as information that is helpful for evaluating the operating performance of our core business without regard to potential disruptions. AdditionaUy, we believe that EBITDA is conunonly used by securities analysts, investors and other interested ponies in the evaluation of high yield issuers, mmy of which present EBITDA wl1en reporting their results. However, EBITDA should not be considered as an alternative to income from continuing opemtions or any otherperfonnanee measure derived in accordance with GAAP or as an alternative to cash flows from operating activities or any other liquidity measure deri\'ed in accordance with GAAP. Our presentation ofEBlTDA should no~ be construed to imply that our future results will be unaffected by unusual or nonrecurring items.

Inh!e of Contents ITEM7.l\-~AGEMENT'S DISClli3SION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

17us ,rection i.1· intemled w pro1'ide informaTIOn that will assm you in understanding ourconsalldattulfinancial staleme//ls,lhe changl!s fn tl1osl!jinancial s/a/erllf!/1/sfrom pt:Yfad /o pl!rlod and the prlmaryfoctors comributlng to thos~ changes. 711cfo/lawlng discu.ulun and o11o~mis shouhf be read in conjmrclion wllll our con,(o/fdat~djinaucial slatemcJJ/sand relatl!d note.~ ill "/Iem 8. Ftnancia/ S!atemel/ls and Supplementary Dala."

In addllton 10 IIWorrcaljinanctal information, the following dtscusston and onal)•sfs conlolnsforward-laoklng staremems thai rejlllcl our pfan.r, es/imotcsaud beliefs h111 that also Involve risks and uncertaimics. Our aclual rcsulls could diifor materiallyfrom those discussl!d inthefonvard.Jooklng stalemcl!ls. Please sec "Fon1·ard-Laoklug Srateme/lfs "and "Item lA. Risk Factars"for discussions oj1lre uncerlainllt:s, risks and assumptions assoclart:d wilh IIII.!S<' sroremcms.

Comp:my 0\eniew We nre a pri11ately-owned automobile tille~lending compnny with 1,035 company-o\'oned stores in 12 stntes as of December 3! 20P. We se!Ve individuals who gencrnlly hove linllted access to consumer credit from banks, thrift institutions, credit card lenders and other traditionol sources of consumer credit. We provide our cus!Oillll~ with access to loans secured by a lien on tht: custorrn:r.;' automobiles while ~Uowing the customers 10 retain usc oft he vehicles during the term oft he loans. As ofDecemher 31 2012, we served more than 470,000 ens tome~ and had appro.ri!rotely SS77.2 million in title loans recei\'able. We belie\'e tllllt we are the largest automobile title lender in the United States based on title !arms receivable.

Our business pro\'ides a simple, quick and confidential way for consumers to ffii!Ct their liquidity needs, We offer tirle loans in amounts ranging from 5100 to SS,OOO at rates thnl we belie11e, based on 111.11ker research, are up to 50% less th~n those offered by other comparable title lenders, with ~~~ average Joan size ofappro,_j1n.1tely S\,300. Our til it: loans do not impact our customers' credit ratings as we do not ntn credit checks on ourTitlelvlaxond TitleBuck~ customers, and we do not make negative credit reports if we are un~blc to collect loan balances.

We conduct business in Tc~s and cenain other stales through wholly..owned suhsitliaries, each of which is registered in the applicable state as a Credit Services Organization, or "CSO. "These CSOs have entered into credit services orgnnization agreements,or "CSOAgrcr:mcll/s, "with third·p~rty lenders, or the "CSOLenders, ''that make the loans to our customers. The CSO Agreements govern the temlS by which we perfom1 servicing functions and refer customers to the CSO Lenders for a possible e;o.tension of a Joan. We process loan applications and conWiitto rein1burse the CSO Lenders for any loans or related fees that are not collected from those customers.

Our gro11th strategy includes increasing our title loans receivable in oure,_jsting stores, opening new stores in existing m;Jrkets and eJqJanding our store base into new markets with fnvo111blc cha111ctcristics. We seck to deYclop and 1n1intain a large presence in e11ch of the rruukets in which we opcrntc. Our strntegy hns enabled consistent gm\11h throughoutl.!!.!l.

Conmnnv's history thill has included fluctuating market conditions.

0659 During the year ended [)cccmhcr 1! ?Oil we continued to execute our growth strategy and opened or acquired 281new stores while closing only two stores, Tite new stores opened include 84 in Te~Gls, 49 in Arizona, 36 in Vrrginia and 62 in Georgia (48 ofwhich were opened under the InstaLoan brand). For the year ended December 11 2012 the (nnmnnv lind revenues ofS656.8million, an increase ofS150.911li!lion or29.8%, and net income ofS79.2million, an increase ofSII.3 million or 16.6%, from Jhe corresponding results for the year ended Dt>cemhcr l! l!llJ.. 11te increase in net income for2012 compared to 2011 was the result ofstrong same-store perfonn:mce and several of our newer stores becomins profitable, partioUy offset by costs related to the oddition ofthe new stores discussed above and an increase in our net eharge·offrntes.

TnhleofCnntent.~

Kty Perform:mce lntlicators We measure ourperfomlllnce through certain key perfommnce indicator.;, or "KP/s, "that drive our revenue and profitability. OUr KPis include total orisinations, average origimnions per store, total title loans receivable balance, average receivable balance per store and net cbnrge-offrate ilS il·percent ofag~;regilte origilmtions over the period. We influence our KPls through operational e~cution, infonnation systems and proper incentives for our field-level employees. E"lemaUy, our KPls are affected by competition and macroeconomic conditions, including availability of credit, consumer confidence, consumer spending habits, unemploy100nt ilnd state ond federnl regulations.

The following table reflects ourresults as measured by these KPis: Y~ar F.ndell December ll, (dellan In thousands! 2012 lOll 201(1 Originations s 794,159 s 6..77,485 s 441,212 Avernge originations per store 910 930 785 Total title loans receivable 577,172 490,093 360,325 A vernge title loans receivable per store 662 Net ch11rge-offs as a percent oforigiMtions 15.1% "" 12.3% 11.8% In :!ddition, we closely monitorsame~store interest and fee income. The C'(lmnnnv considers interest and fee income from stores open more than l3 months in its caleul:uion of same~ store interest and fee inco100. 11te following sunvnarizes the C'onm~nv's same-store interest and fee income for the fiscal years ended Decen1ho;r :.1 2Dt2,1!l.Ll and lQ!..Q: Year £nd~d Dl!temb~r ll. {dotlnrs in !hous:mds} lOll !011 2010 Interest and fee income s 552,692 s 483,285 s 385,160 Interest and fee income growth 14.4% 25.3% 29.1% Number of stores open more than l3months 6!1 554 540

Tnh!c ofComenl~ Results ofOJlCralions Strue Sofl11'nre System In May 2012,. our new proprietary store software system, which is used in approximately 2.1.4% ofour stores as of December:"! 1 2012, incurred signific<~nl service outages. T!JCSC outages caused us to rc\•iew the status oft he system as a long-tennsolution for our existing and future stores. Based on this review, we initially detennined and announced that we would d1'scontinue furl her development of the systetn and write·o rftbe relllted capitah'zed costs, However, a fler the service outages in M:sy, we stnbilizcd the pla.tfonn and obtained vendor quotes to correcttechnicnl deficiencies. Bnsed on this additional infonnation, we decided to reevaluate whether we will continue developmem ofthe proprietary system or purclwse a new p:~cknged softw11re system to meet our future needs. This evaluation remains on-going. We dctennined that we aru not required 10 record an impaim~ent charge related to our proprietary store software during the year ended Deccn~1er >I ?O!"l becouse the undiscoumed future cash flows from the asset group are greater than the canyin!:l amount. However, depending on the outcome of our full evalu:llion, it is reasonably possible !hilt we could decide to implement a different store soil ware system and discontinue the development ofour proprietal)' systent This decision could result in a one~time, non-cash expense thnt could runge from S13.0 nullion to SIS.O million. }'Cor Emlctl Dt!cemher 11 2()12 Cvmpurcd 11) l~11r Enrfctl nccemher H 2flll Interest and fee income Interest and fee income was 5656.8 million for 2012 compared to SS05.9 million for2011. TI1c increase of$150.9 million, or 29.8%, was primarily due to the addition ofa significant number of new stores over the las\ 12 months and strong same-store perfoffilllnce, !merest illld fee income from stores open less than 13 months increased $81.5 in 2012 compllrcd to 2011 and accounted for 54% of the total increilse in 2012. Same•store interest and fee income increased S69.4 million, or 14.4%, for 2012 compared to 2011. The ('(l!Jmnm• considers interest a11d fee income from stores open more than 13 months in its calculation ofsome-store interest and fee income.

Pro\ision for lo:m losses Our provision for loan losses was 5144.7 million for 2012 compared to S99.S million for 2011, an increose ofS4S.2 million, or 45.4%, The provision for loan losses is based on loan loss experience, contractual delinquency oftitle loans rcceivilble, economic and other qualitative considerations and ~Mnagcmcnt's judgment. Approximately Sl2.0 million ofthe increase relates to a 26,6% increase in loan originations, and the remnining increase of$33.2 million was due to un increase in our loan loss charge-offrate. Net cht~rt;e-offs as a percent of originations incn:ased to 1:5.1% for2012 from 12.3% for20J I. The net chargc-offs and originations include loans made by our CSO Lender.; that we guarantee. Our net charge-off rule hos increased during the l~st twelve months, due primarily to the nddition of a significant number of new stores and rapid loan growth. During this period, we have worked to m.1nage ourcharge-offs in the face of the significant incNil$C in new stores and loan volume ilnd we will continue to monitor net chnrge--offmtes and make udjustrnents as necessary to IMxilnizc loan portfolio growth nnd long-tem1 profitability.

Costs, expenses nnd other Salarie.~ and related t•xpenscl·

Salaries ond related e.wenscs were S201.9 million for 2012 compared to Sl59.2 million for 2011. This represents an increase ofS42.7million, or 26.8%, This increase was mostly due to growth-rel~ted increases in hcadcount, primarily rei :\led to operational personnel necessruy to scrvke the higher volume of loans and as n result of opening new stores. Also contributing to the increase was higher corpomte headcount, primarily in the areas of operations, construction and real estate. In addition, n significant portion ofour operation~ eflllloyees' compensation is incentive-based, which increased SJ2.1 million due to higherprofitabilhy ot the store, district and regional levels.

0660 Occupancy costs Occupancy costs were S64.7 million for2012 compared to $48.6 million for2011. This increase ofS16. 1 million, or 33.1%, was primarily due to increases in rent, utilities, and nuintenance costs BSsociatcd with opening new stores as weU as expanding corporate office space.

D~:prec/atlon ami amorlizaJion Depredation and amollization for2012 was S17.2 nullinn con~ared to Sll&million for2011 The increase ofS3.4 million,or24.6%, was primarily attnbutableto remodeling and relocating stores, fitting out new stores and e;o,panding corporntc office sp11ce.

Tnh!e ofConrem~

Advertising expense for 2012 was $22.2 miUion compared to Sl5.5 million for2011. The increase ofS6.7 million, or 43.2%, wa~ prim:uily due to increased intemet advertising and online lead generntion rdated to ourupgrnded we~>.~ite.

Othrr opcrallng and admlnisrra/lve e.r:penses Otheropernting and administrative e:-.penses for 2012 were S77.5 miUion compared to $58.7 million for 2011. TI1e increase ofS\8.8 million, or 32.0"/c, was prinurily attn'hutable to growth- related increases in costs associated \\ith collatefill collection, technology services and office supplies and postage. !meres/ e.{pem·e, net, Including tJmorllzallan ofdebt issuanr:e costs Interest expense, net, including: amortization ofdebt issuance costs, was $49.3 million for2012 compi!red to $42.6 million for2011. This represents an increase of$6.7 million, or 15.1%.

During 2012, we incurred S4.4 million ofi!ddition<~l interest compared to 2011 on S60.0 million aggregate principal amount ofour 13,25% senior secured notes issued on Ju]\' 22 2011. We also incurred interest ofSJ.3 miUion in the second halfof2012 on our $25.0 million revolving line of credit obtained on June 27 2012. Also contributing to the increase in interest e){Jcnses was an increase in notes payable issued by TMXFinance LLCand our consolidated CSO U:nders. We e>.pect interest e>.pensc to increose in the future relative to prior periods due to the higher average out5tandillg debt balance.

Net income As a result of the above factors, net income was $79.2 million for 2012, an increase of 16.6% over net income ofS67.9 miUion for 20!1.

H:nr Endr!d IJN'(!/11h(•r 31 }Ill 1 Compared to }t-(lf Ended Pf!wmhor 31 2fl11) Interest and fcc income Interest and fee income was S505.9 million for 2011 compared to $389.4 million for2010. The increase of$116.5 million, or29.9%, is primarily due to strong s~me•store performance as customers turned more to title l~nding because ofa contraction of credit from other sources. Snmc·store interest and fee income increased SI01.2 million, or26.3%, for the year ended Deeemher ~ 1 'Oil compared to the snme period in 2010. The C'onmnuv considers interest and fee income from stores open more than 13 months in its calculation ofsnme-store interest and fee income. Interest and fee income also was higher in the year ended Decem her J I 201 I due to an increase ofappro1cimately SIS.3 million from 5I ores open less thon 13 months. The increase from stores open less than 13 months accounted for 13% ofthe total increase in interest and fee income.

Pro\ision for lo:m losn~s Our provision for loan losses was S99.Smi.llion for20ll compared to S63.9ml1lion for2010. The provi$ion increased S35.6million,or 55.7%. Appro11imately SIS.Omi!lion ofthc increase rel~testo the 29.9'% increase in loan originations, and the renmining increase ofS20.6 million was due to an increase in our ]oat! loss charge-off rate. Net charge-offs as a percent of originations increased to 12.3% for the year ended Decemhcr Jl 201 1 from 11.8"/, for the comparable period in 20!0. The increase in our net clmrgc-offrate was a result ofa shin toward growth in our store management incentive pl~ns, which led to an increase in loan originations.

Costs, ex~nses ::mdoth~r

Saforl~:s and related e.r:prm.ws

Salaries and related e>.penses were S\59.2 million for 2011 con~ared to Sll6.1 million for 2010. This represents an increase ofS43.1 million, or 37.1%. Approximately S24.l million ofthe increase was due to growth-related increases in headcount, primarily related to opemtional per50nnelnecessmy to service the higher volume: ofloans and as a result of opening new stores.

Also contnbuting to the increl!se was h1'gher CO!Jlornte headcount, primanly in the an: as ofinfolltllltion technology, recruiting nnd real estate and construction. In addition, a significant portion ofonroperntions employees' compensation is incenti\.'e-b~sed, which increa~ed S!8.9 million due to higher profitabilit)' at the store, district and regional levels.

Occupancp casf.v Occupancy costs were 548.6 million for 2011 compared to S3-1.9 million for2010. This incrense of$13.7 million, or 39.3'Vo, was primarily due to increases in rent, Utilities, and maimenance costs associated with opening new stores as well as expanding COJJlO!iltC office space.

Deprcciarfan ancl omorllzalfan Depreciation ;md amorti~tion for2011 was S13.8 million compared to $10.4 million for2010. Tile increase of$3.4 million.or32.7%, was primarily autibutab!e to remodeling and n:loc;uing stores, filling out new stores, e>.pl'lnding corpomte office space and the acquisition ofan aircraft in the four1h quarter of2010. Also contributing to the increase w;u dcprecintion e:q:Jen5e related to an upgmde to our proprietary lor~n system, which was pl11ced in service in the 5ccond quarter of2011.

Ad!•erlislllg Advertising e>.pensc for2011 wllS SlS.S million compared to S\0.2 million for2010. The increase of$5,3 million, or 52.0%, WllS primarily clue IO incrcnsed television odvertising costs in

0661 2011 related to airtime for our "shorl on cttsh" marketing cnmpnisn.

Otlu:roperallng and udmlnlstratlvc expc11sr:.s Other operating nnd administrative expenses for 2011 were SSS.7 million compared to S41.4 million for 2010. The S17.3 million increase was primarily driven by growth-related increases in costs associated with recruiting and relocation, collateral collection, accounting and legal services, tmvel, <~nd office supplies and postage. /lit<! rest expense, 1w1, Including amorll::at/OI1 ofdeb/ issuance cus/.1' Interest e:q~ense, net, including an:ortilation of debt issuance costs, was S42.6 million for2011 compared to S26.3 million for 2010. 11tis represents an increase ofSl6.3 million, or 62.0%. During 2011, we incurred $15.6 mi!lion oflldditional interest compared to 2010 on the 5250.0 million aggregate principal amount of our 13.2$% senior secured notes issued on 1pne 21 lf!!!l. In addition, during 2011, we incurred interest of$3.5 million on S60.0 million nggrcgate principal amount ofour 13.25'lf. senior secured notes issued on lulv 22 ?OJ I. These increases were partially offset by interest incurred in 2010 on ourtenn loan at the defauh rate during our bankruptcy proceedings Reorganization item~ There were no reorganization items in 2011 compared to S4.S million for 2010. On June 16 2011,the final 01apter II decree closing the bankruptcy case was signed and filed with the court. See Note 16 of Notes to Consolidated Financial Statements in ''l/<!111 8. Financial Stalcmmls and Supp!cmcnfmy Data."

Net income As a result ofthe above factors, net income was S67.9 million for 2011 compnred to S81.7 million for2010.

Tnhle of\nnt••nrs UqultUty and Capital Rcsourc~s We nmnage our liquidity and capital positions to satisfy several objectiv~s. Near-tenn liquidity is managed to ensure adequate working cnpital is nvnilablc to fund seasonal gro\\1h in l~Jans and relnted interest receivable in nn nmount that c>.I:Ccds increAses in accounts payable and accrued eXpenses. G-owth in working capital is driven by dem:md forourlonn products and is funded on a near-tenn basis througlt operating cash flows without the need for reliance on other sources. Long-tem1 cnpitalnecds are managed by assessing the growth capital needs oft h.:; Compmw and bnlancing those needs against the available ill\em a] and e>J:emnl capital resources. Long-temt capita! needs have historically been fimded through credit facilities and issuances ofdebt securities. We m.1nnge the risk that we may not be able to refinance our debt securities through propertiming ofrefinaneing trnnsactions nhead of scheduled maturities and, to a Jesser c:.tcnt, as market conditions pcmtit.

Our principal sources ofnear-tcnnliquidity are cash on hand, working capital, cash flows from operntions and borrowings under our new $25.0 million secured revolving credit facility described below. Cash and cash equivalents were $90.8 ntillion at D.:;cemhcr31 20\"1 as compared to $38,1 million at n~cl'mher 3\ 2011.

In June 2010 and July 2011, we issued $250.0 million and $60,0 million, respectively, of senior secured notes due 2015, These senior secured notes, or "the Notc.f, "were offered only to qualified institutional buyers pursuant to Rule 144A under Ute Securities Act of 1933, as amended, or the "Sccllrl/lc.tAct," and to non~U.S. persons olllside of the United States in compliance with RegulMion Sunder the Securities Act.

The inclenture governing our Notes, or the "lmiNtture "lm.its ourabiUty to incur additional indebtedness. Howevar, we were pcnnittcd to obtain 01 S2S.O million seniorseeured revolving loan facility that is equal in priority with the Notes. ln June 2.012., we entered into a crtdit agreement, or the "Cretl/1 Agreement,'' to obtain a senior s~ured revolving credit facility of up to S25',0 million, or the "Rcvu/vlug Crcdl/ Facility," that matures hme 15 "0!;. Subject to ccnain exceptions, the obligations under the Revolving Credit Facility are fill\y and unconditionally guarnutced by TMX Finance LLC, TitleMn:< Finance Corporntion and eDch oftheir existing and future donlt:stic suhsiriinries. The Revolving Credit Facility and the guarantees rank equal in right of payment with the Notes. The Credit Agreenx:nt contains certain covenants thnt are subsHmtially similar to those in the~. l11e Credit Agreement also contnins a financial covenant that requires the maintenance ofa minimum earnings to fixed charge ratio of2:1.

'fiLe hulentm"e and Credit Agreement permit us to incur additional debt as long as the new debt does not cause us to m1intain less than a 3:1 earnings to fl»!d charge ratio, as defined in the~.ln addition, ifoureamings to fL'I'I!d charge r.uio is below 3:1, we are permitted to incur up to SJO.O million of additional indebtedness and an incremental S25.0million of guarantees underourCSO Agreements. As ofDecemhcr31 20t~. oureamings to fi.~d cl!arge ratio wt~s below 3:1. We may seek to draw on the additional permitted sources ofborrowing in the foreseeable future to continue to facilitate our srowth strategy. For n description ofour outstanding borrowings, see "-Oilier lndcbt~:d/lcss."

Additional covenants in the lndenHrre and Credit Agreement restrict, among other things, oura\Jility to dispose of assets, incur guarantee obligations, pr~pay other indebtedness, make dividends and other restricted payments, create liens, make equity or debt investments, m1ke acquisitions, modify tenm ofthe lnd!:nture, engage in mergers or consolidations, change the business we conduct, engage in certain trnns~ctions with affiliates and make distn'butions to rhe Sole Shareholder. Such restrictions, together with our highl~·Jeveragcd nature, could limit our ability to respond to changing market conditions, fund our capital spending program, provide for une~ected capital investments or take advantage ofbusiness opportunities.

We are in compliance with the covenants in the Indenture as ofD«cemher 31 :W12. The~ requires us to maintain an cantings to fi;\'ed chargerntio above 3:1 for us to incur additional indebtedness, including the issuance ofsuarnntees under our CSO Agreements. We do not anticiputc 11 significant decline in demand for our products and services, but any such decline or other uneXpected changes in financial' condition could et~use our earnings to fixed charse ratio to remain below 3:1 for an e~ended period oft~. If we are unable to incur additional indebtedness for sro\\1h in our CSO operations, our net income may decrease due to impuimlt:nt of assets and less revenue from CSO operations, which could adversely affect our ability to obtain new credit under favorable temiS. To the e>J:ent that we e."Perience shon~tcrm or long-term funding disruptions, we hnve the ability to address these risks through various menns, including a.djustn\Cnts to short-rennlending to customers. reductions in capital spending, reductions in e>.penses and potential equity contnlmtions from our Parent, all of which could be e;,pected to generate additionnlliquidity.

To the extent permitted by the Indenture and Credit Agreement, we e)ilect to make periodic distributions to our Parent in nmounls Sltfficient lo pay some or all ofthe taxes due on the ~·s items ofincome, deductions, losses and credits whi~h ha\'C been aUo~ated for reporting on the Sole Shareholder's income taxretum. We may also make distnbutions to our Parent in addition to those required for personal income taxes. Total distn1mtions were approximately S23.3 million, S!3.0 million and S7S.4 million for the years ended n~ce!llher::; I 2012, 2011 and 1Qill, respectively. The 2012 amount includes distributions ofappro>.lnmtcly SO.S million by our consolidated CSO Lenders. The 2011 amount includes a noncash distribution of appro:.irnate\y SQ.3 million related to leasehold improvements in store location properties sold Uy TY Investments, LLC, which is owned by the Sole Shar.:;holder. See "Item 13. Certain Relationships and Related Transactions, llnd Director Independence-Real Estate Leases. We anticipate making distnbutions to the Parent for estimated inconlt: ta~s for 2012 totaling approximately $23.0 to S26.0 nullion. At Decernher 3t '1()12,

Thh1e of\on[<;og the availability ofpcmritted distnbutions for purposes other than estimated income taxpnymcnts was approximately $5.0 million (calculated net oftm estimate for income tl'l)o;I!S).

0662 The .ln!kn.!llr!l requires us, in the first quarter ofeach ye~r. to tn!lke "excess cas/! flow offerl·" (as defined in the~ to all holder5 ofNotes to purehase the maximum principal amount ofNotes that may be purchased with the Jesser ofS3D.D million or 75% of our excess cash flow (as defined in the l!!d~!!!!!I!<) forlhe applicable fiscal year. We made t!n excess cash flow offer in March 2012 at 102% oft he principal amount oft he Notes, but no holders of the Notes accepted the offer. We will make another e;o:;ess cash flow offer in March 1013 at 102% qf the principnl amount oflhe notes. An investment banking firm 111.1kes a market for our Notes and the volume oftrnnsactions is relatively smtll. Historically, the market price for our Notes based on the limited tmding that occurs has been well above the price we must offer in the excess cash flow offer. Therefore, we do not e>-pect a significant amount of cash to be used to fund the 2013 excess cash flow offer.

In May 2010,\he IRS initiated an C)<lmination ofthe income tax return ofTitleMaxofG:orgia, Inc., or "TMG. "The e;.amination was e;-p~nded to coverall oftlte C'.onmmw's wholly- owned suh~i!liMie.~ and TilleMa:<Aviation, or "Aviation," an entity owned by our Parent that we consolidate because we have detemtined it is a variable interest entity ofwhich weare the primary beneficiary, See "Jtcm13. Ccrtafn Relationships and Rrlated Transacflons, a lid Director Jndeprmlence-Airplane Paymem~·. "The IRS completed its fieldwork and issued its report in April2011. We paid o.ppro>.imately S0.9 million in 2011 for agreed adjustments related to the IRS e;.anllnation. We successfully contested other proposed adjustments, :md tl1e eN~.mination was closed in September2012.

In November20l0, we acquired an aircraft for S\7.5 nul !ion that satisfied the requirements ofSection 1031 of the llltcmal Revenue Code to complete the like-kind e:-::h~nge for an aircraft we sold in May 2010. The purchase oftl1e aircraft was fimded by notes payable to the Sole Shareholder. In February 2011, tl~escnotes were refinanced into one note payable to the Sole Shareholder with a principal balance ofSI7.4 million bearing interest at 10%. In December201J, this note was refinanced into two notes payable to the Sole Shareholder. As of Decernher 31 2012, these notes have principii! balances ofS11.4 million and S5.4million and bear interest at 5.12% :md 10%, respectively. See "item 13. Certain Rdationshlps and Refa1cd Tnmsoclfolls, ami Director Judi!pendel/ce-AirpfaJie Paymems."

In July 2012, the Sole Shareholder OJ;~ de nn equity contribution ofS14.0 million to the Cornn:mv. ln November 2012, the Purent maUe nn equil)' contnbution ofS44.8 million to 11!£ Cnlllnnny. The November 2012 contribution was funded by proceeds from the sale ofStOO million of 11.0% PIK Notes due Octo her 15 2015 or the ''PIK Notes," by the Parem to unrelated pnrties. Under the tenns ofthe indenture goveming the PIK Notes, interest on the PIK Notes is pay~blc in cash to the e~ent dismbutions nre nvnilablc under the terms of the~ governing 1he Commmv's Notes. If distributions are nOIJJemlitted under the tenns oft he itldcnum; governing the ('omnrmv's Notes, the Parent nny issue additional PIK notes in a principal amount to satisf)' the interest due. Distributions fromth¢ Cnnmnpv to the Parent, when pennilted, will pro\'idc the primary means for the Parent to make any cash interest payments on the PlK Notes. The ma»mum potential amount of dismbutions for purposes of funding the Pareut's Interest payments is Sli.O million for each of the years ending December 31 2013, ~and2!lJi.

Cuslljlowsjrom operotiug activities Net cash provided by opemting activities was S'l.22.3 million for2012 compared to S175.2 million for 2011. The increase of$47.1 million, or 26.9%, wM due to an Sll.3 million increase in net income, as well os a S35.8 million incre~se in adjustn'lents to reconcile nc! income to cash provided by operating activities. The incre~se in odjustmenls lo reconcile net income to cash provided by opernting activities was primarily driven by a S45.2 million increase in the prevision for loan losses, whicl1 resulted from increased demand for our loan products and an increase in our net chnrge-o!Trate, :~s well as :1 S3.4 million increase in depreciation and amonizntion e~ense. These increases were partially offset by decreases in cosh from changes in other assets and accounts payable. The decrease in Cllsh from chnnges in other assets was primarily attribut<tble to Si,l million more cash used for deposits related to our unconsolidated CSO Lender and an increase ofS<I.I million in prepaid e>.penses. The decrease in cush from changes in accounts pllyoble wns due to timing of payments.

Cusltflam<rftom i11vesti11g nctivltics Net cash used in investing activities WitS $2$4.$ million for 2012 compared to $246.5 million for 201 I. The increase ofS8.0 million, or 3.2%, was prinnrily attdbutable to an 58.7 million increase in capitr~l e>.penditures and a $5.3 million incrense in net title lor~n originations. The increase in capital expenditures w~s related to ongoing projects to upgrnde our technology and to ltli\nagc our store ponfollo through remodels or movement oflocntions, fitting out new stores and installing new si{l:nS. These increases were partially offset by SB.O million ofcash paid for acquisitions durinl;l20ll.

Casltf/ows jrumjluuuciug uctMtles Net cash pro\'ided by financing activities for 2012 was S84.9mi11ion compared to $55.9 million for 2011. The increase ofS29.0 million, or SUI%, was primarily the result ofpro~eds of SSS.S million from equily contnbutions and S25.0 nullion from the

Revolving Credit Facility in 2012 compared with proceeds ofS64.2 million from the Notes issued in 2011. Also contributing to the increase in cash provided by financing nctivities was n decrease ofSJl.S million in repayments of notes payable i!nd capital leases. These increases were partially offset by a St0.6 million increase in cash used for distributions.

Other Indebtedness As ofDeccmher J I. 10J?, we hnve S57.0 million ofnotes payable in the D£J:lregllte, consistin1; of one unsecured note pi!yable to ~bank, three unsecured notes payable to other unrelated entities, three unsecured notes payable to the Sole Shareholder and several notes payable to third parties issued by our two consolidated CSO Lenders.

The note payable to ~bank and the three notes paynble to the Sole Shnreholder nrc pnyable by Avi~tion. The note payable to a bank has a principal balance ofS0.4 million as of Dec<!mher J I 1011 and incurs interest at 4.4%. The three notes payable to the Sole Shareholder nrc in tl1e amounts ofS11.4 million, S5.4 million nod S2.8 million as ofDeccmher 31 2012. The Sll.4 million note has a fixed interest mte of5.12% and is payable in monthly installments ofS104,000, including interest and prineip~l. '\ith n fmnl payment of$8.4 million due in December 1016. The S5.4 million note has a ft'!<!d interest rote oflO% payable monthly, with the full principal amount due in December 2015. The S2.8 million note is coll~ternlized by an aircrnft 01\1\cd by Aviation and guaranteed by the C'omnar\V. This note has a ft\l!d interest rate of6.35% and is payable in monthly installments ofS35,000, including interest and principal, with a final payment ofS2.1 million due in October 2015.

The three notes payable to other unrelated entities are in the amounts ofS6.0 million, S5.0 million and SLO million as ofDeccmher 31 101 1. Each ofthese notes bears interest at 13% with interest payable monthly, The principal amount of each ofthese notes is due in July 2013, although !he $5.0 million note and the Sl.Omillion note nuy be elllended for up to one additional year at our sole discretion.

As ofDecemh<!r Jl 2012, our consolidated CSO Lenders had outstanding a total of$25.0 million of notes pay~hle 10 third panics, One consolidated CSO Lend~r had 41 notes due in 2013 that bear interest rnnging from 10% to 15% and are secured by the assets oft he consolidated CSO Lender. These notes allow the consolidated CSO Lender to take one or more dmws up to a total m1,.j'mum principal of$17.1m.illion. As ofQecemhrr J I 2012, a total ofS14.1 million was dr.ll\11 underthese notes. As ofD~cgmher3! 10p the other consolidated CSO Lender had 11 unsecured notes due in 2013 that bear interest mnging from 12% to 14~{, nnd allow draws up to a total rna:cimum principal ofSI1.9million. As ofD~c~mh~r:; 1 10]1, a tmal ofSl0.9 million was drnwn under these notes. Each of these notes h~s an automatic annual renewal provision.

lvlanagement belie\'cs that our available shorNenn and long-tern\ capital resources will be sufficient to fimd our anticipated cash requirements, including working capital requirements, capital e).}lenditures, scheduled principal and interest payments, payments pursuant to any excess cash flow offers and income tax obligations of our Sole Shareholder, for at least the nell! 12 months.

0663 c:~ptal Ell:penditure.s Capital expenditures a~ ofDecemher :11 .,012 .fQ!l and 2010 were S40.3 nn1lion, $32.0 million and 18.6 million, respectively, which we used to open new .stores and develop our software .systems. We do not have any material capital expenditure conunitment.s as ofDecemher:; 1 :!IH?. However, we will continue to open additional stores and further improve our software systems, which will reqllire ongoing capital e:q:~enditures.

Tnhlc of Contents Contrnctual PaymcntONig:ltions The following table summariu:s our material contrnctual payroont obligations, including periodic interest payments, as ofDecemhcr :11 2012.. These contractual requirements in dude payments required for our debt obligations, operating !eases and contractual purchase obligDtion~.

P:~vmenls due bv De~ernber l\, Tol~t 2013 2014 lOIS 2016 2017 There>!.Tier 433,225 s 41,075 s 41,015 s 351,075 s s s 31,%6 2,535 2,535 26,896 13,400 13,004 47 47 47 255 26,620 26,620 29,264 2,771 3,340 11.317 11,836 3,105 261 267 272 m 283 1,745 206,998 46,333 41,862 27,741 17,806 37,217 744,57& s 132,599 s 89,126 s 39,S'QJ s 18,344 s 38,962

(I) The ln<lentme requires us to make e~css cash flow offers in the first quarterofeaclt year fort he le5scr of$30 million or7S% of our e>.r:css c<t.sh flow {as defmed in the !nrlenlllrel. The contmctunl payments shov.n in the table do not include the elfects ofDny such e;>J:ess cash flow payments as the amounts, if any, are not presently detcminable.

Seasonality Our business is seasonal due to fluctuating: demand for our title loans during the year. Historically, we have ~erienced our highest demand in the founl1 quancr of each fiscal year, with approximately 30% of our annual originations occurring in this period. Also, we have historically e:-.petieneed a reduction of9% to IS% in our title loans receh•able in the fmt quanerof each fiscal year, primarily associ:ned with our customers' receipts oftnxrefi.md checks. Accordingly, we typicnlly e:q>ericnce a higher use ofeash in rhe founh quarter while genernting more cash in the first quarter(e:~t:lusive of any other capital usage). Due to the seasonality ofour business, results ofopcmtions for any fscalqunner :~re not necessarily indicative ofthe results of operations that may be achieved for the full ftscal year or;my future period.

Critic:Jl Accountinc: Policies The preparation oflh~ C'ornn:nrv's fmancial statements requires management to make estimates, assutnptions mtd judgments that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the coiiSotidated financial statements and the reponed amounts of revenues and expenses during the reporting periods.

Manogement bases its estimates on historical experience, empirical data and various assumptions thai are believed to lie reaso1111ble under the circumstances, the results of which form the basis for making judgments about the call)'ing values of assets and liabilities. Actual results may differ using different estimates or under different assumptions or conditions.

l\·lanagemcnt believes the following critical accounting policies affect ils more sinnifitalll estimates, assumptions andjudgmcnts used in the preparntion of its consolidated financial Sllltements. The development and selection ofthese cJitical accounting policies and the related sumn>Jries of them below have been reviewed with the Board ofl\·lanager.s ofrhe Comrwt)v A//rmmrce far Lmm La.\"Sr:s and Accmal far CSO Lcmlr:r !.mm l.assr:.~ The roost significant estimates made in the preparation of our accompanying consolidMed financial statements are the detemliuation of an allowance for Joan lo~scs and an aecruol for losses related to loans we process for our unconsolidated CSO U:nder. The allowance for loan losses and accrual for lo11n losses related 10 our unconsolidated CSO Lender represent m.1nagemem's estimate oflosses on title leans receivable and loons processed for our unconsolidated CSO Lender that we suarantee under CSO Agreements. These cstinutes are based on an nnalytica] model tlmt contemplates .several factors, including historical delinquencies, charge-offs ~nd rccoVcl)' rates, Additionnl factors, such as lcngdt oftime stores have been open in a state, relative mix: of new stores within a state and other relevant factors, are evaluated on a periodic basis to determine tlte adequacy oft he reserve. Based on the results ofthis analytical model, we record an allowance for loan losses on our consolidated balance shcets.ln addition, we record a liability for estimated losses related to the guarnnteed loans owned by our unconsolidated CSO Lender in nccO\mts payable and accnred C)lj)enses on our consolidated balance .sheets. Loans that are deemed to be uncollectible are charged-ofhgainst the allowance when they become 61 days contractually past due. Recoveries on losses previously charged to the allowance arc credited to the

Tnhlc MC'ontcnts allowance when collected. For the years ended Dcccmher 31 2012 and lQU. if default rates had been 25% higher or lower, the al!owance for loan losses would have changed by appro:Wnate!y S14.4 mr1!ion and S12.2 million, respectively. lm:amr: Recognition Interest and fee income is recognized using the interest method. Accrualofintere.st and fee income on title loans receivable is discontinued when no payment has been received for days or more. Effective Octoh!!r I ,009, m.1nagement changed its accounting estimate related to the suspension ofinterest and fee income. Prior to this date, accrual of interest Dnd fee income on title loans receivable ceased when no pnyment was received for 30 days or more pursuont to controctuoJ terms. Based on additional information and nnalysis of customer trends, management determined that the likelihood of receiving a payment fromn customer dinlinishcs when no payment is received for 35 days. TI1e accrual ofincome is not resumed until the account is less than five days past due on n contmetu:r.l basis, at which time management considers collectability to be probable.

Recent Accountinc: St:md.:lrlk In October2012, the Financial Accounting Standards Board, or the "FASD," issued ASU 2012-04 to provide technical corrections and improvements to a wide r.mge ofTopics in the Accounting Standnrds Codification, including confonning amendments related to fair vnlue measurements. TI1e amendments in this guidance will be effective for fiscal periods beginning aflcr Deccll\h!!r 15 2012. The adoption ofthis guid~nce is not n:-.pected to have a material impact on the ('onmmw's financial position, results ofoperations or cash llows.

0664 Off-B:d~oce Sheet Arrangements l\ith L'nconsoHdaled CSO Lender Under the terms oft he CSO Agreements with non-exclusive third-party lenders, we are contractually obligated to reimburse the lenders for the- full amounts ofthe loans and certain rolaNd fees that arc not collected from tltc customers. in certain cases, the lenders sell the re!oted loans, and our obligation to reimburse for the full amounts ofthe loans and certain related fees that are not collected from the customers e»ends to the purchasers. As ofDccemhcr ~ 1 2012, the total amount of!oans and related fees guaranteed by us was appro>.imately S26.9 million. The value of the related liabilil}' at Dccemhcr :\I 2012 was appro>-im:ltely S4.6 million and is included in accounts payable and accmed e1.penses on the consolidated balance sheets and provision for loan losses on the consolidated statements of income. · IT£\17 A. QUANTrfATlVEAND QUALITATIVEDISCLOSURES ABOUf MARKET R1SK.

The Compnnv does not have any financial instruments that e:-.pose it to material cash flow or earnings fluctuation~ as :1. result ofmarket risks.

Tphle ofContcnt~ ITEMS. FINANCIAL STATE1olENTS AND SUPPLEM.b'!TARY DATA.

Ji'.'DEX TO CONSOLIDATFD FINANClALSTAT£\lENTS Rcnon oflmlcnendcm Re"i~lererl Puhlic Accmmrins Fim1 32 C'on~olidntecllhl;mee Sheet~ n~ off)ecemher 11 '>012 and 2011 33 C'on::olhlored Stmenb!nt~ nf!ncnme forth(; 'teao: Fndcc! Pcet•mh.:r:ll '>OJ'> '101 l nnd '>010 C'on~olidnt(;d Statements ofMemher·~ F.m1ity and Nnnco!J!ml!jnl! Interest~ for the Ycnrs F:nded Oeecmher 31 201'> 2011 nnd '010 Consolidnted Stnt(;nJents nfCn~h Flow~ fnrthe Vena: FJlded Decrmher11 20!"1 '>01 I nml 'lOJQ " 3S Notes to Con~nlidmcd Fin11neial StmcrilCn!~ 38

TnhleqfCnntCil!~

Report of Independent Reg1steredPubllc Accounting Firm To the Board ofDircctors nnd Sole Member TMX Finance LLC and Affiliates We have audited the accompanying consolidated balance sheets ofTMX Finance LLC and Affiliates (collectively the "Company") as ofDeccmhcr 31 2012and 2Ql!, and the related consolidmed stme~mms ofincome, member's equity and noncontroUing interests, ami cash llows for the three years in the period ended Dcccrnhcr :11 101'>. TI1ese financial statements are tl1e responsibility of1hc Conm:m\''S m.:umgemem. Our responsibility is to e:-.prcss an opinion on these financi~l statements b~sed on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). TI10se standards requin: that we plan and perfonn the audit to obtain reasonable nssumnce about whctherthe consolidated financial statements are free ofn1.1teria\ misstatement. The Commmv is not required to have, nor were we engaged to perfonnan audit ofits internal control over financial reporting. Our audits included consideration of internal control over financial reponing as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose ofe)Jlressing an opinion on tl1e effectiveness of1he Conmnnv's internal control over financial reponing. Accordingly, we e"Press no such opinion. An audit nlso includes eHtmlning, on a test basis, evidence supponing the amounts and disclosures in the financial statements, assessing tl1e accounting principles used ~nd signific~nt estimates made by management, as well as evaluating the overall fin;mcial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our oplnion, the consolklated financial statements referred to above present fairly, in all material respects, the fmancinl position ofTMX Finnncc LLC llnd Affiliates as ofDecemhcr 11 2012 and 201 l, and the results ofthciropemtions and their cash flows for the tilrcc years in the period ended D.;c<!mher 31 "lOP in confmmity with U.S. genernlly accepted accounting principles.

Is! McGfmlri!J' l.LP Rnldgh, Nonh Carotlna Mnrch '17. "lQIJ

Thhle ofCnntem~ Ti\-LX FlNAI'>ICE LLC AND AFFILIATES Consolidated Balance Sheets Dec~mho.lr31.2012 nndlQ.U. (in thousand!:) 2012 2011 Assets Cash and cash equivalents s 90,794 s 38.141 Title loans receivable 577,172 490,093 Allowancc.forloan losses (94,561) (73,103) UnamoniZ!:d loan origination costs 3,716 2,829 Title loans receivable, net <186,327 419,819 lnteresl receivable 38,055 31,517

0665 Property and equipment, net 95,239 72,57\.

Debt issuance costs, net ofaecumu[ated amortization of$9,526 and S5,445 as ofDeccmhcr 3 I 20)? and December~! 101 I, respectively 10,570 14,042 Goodwin 5,915 5,975 Intangible assets, net Note receivable from Sole Shareholder Other assets 1,077 39,746 '" 1,549 20,994 Total Assets s 767,7?:3 s 604,748 Uatilifics nndfquity Senior secured notes, net s 311,519 s 312,120 Revolving credit f;~cility 25,000 Notes payable 37,336 11,370 Notes payable to related panics 19,628 20,5\2 Obligodons under capital leases 1,971 2,052 Accounts payable and 11ccmed c;.,penscs 61,341 62,356 Total liabilities 456,195 408,410 Commitments and contingencil!S (Notes 13 and 14) Member's equity and nonconuolling interests: Total member's equity (with ret:~incd earnings ofS243,835 ;md Sl86,704nt n¢cl!mher 31 "l()J"l and neccmhcr:'\1. "l()J 1, respectively) 318,365 202,484 Noncontrol!ing interests {7,377) (6,146) Total member's Cr[Uity and noncontrolling interests 310,988 196,338 Tot:~! Uabilities and Equity s 767,783 604,748 See notes to consolidated financial statements.

Tnh!c ofe":omc111~ T!\tx FINANCELLC AND AFF£LIATES ConsolitbtcdStntcmcnts or Income For the Years Fntled Drcrmher 3 r 2012,2Qll antllill.!). (in thousands) ZOt2 1011 2010 Interest and rec income s 656,755 s 505,865 s 389,449 Provision for loan losses (144,749) (99,542) (63,932) Net interest :md fee income 512,006 406,323 325,517 Costs, expenses and other: Sal~ries and relotcd c>:penscs 201,899 159,201 116,090 Occupnnc:y costs 64,727 48,556 34,939 Deprecbtion and amortizlt!on 17,210 13,813 10,353 Advertising 22,227 15,512 10,243 Other opr:r.tting and odministrnlivc c:-:penses 77,469 58,696 41,407 Interest, including amortization of debt issuance costs 49.293 42,610 26,251 Total r:~cnses 432.825 338,388 239,283 Income [Jefore reorganization items 79,181 67,935 86,234 Rcorganiz:ttion items: Professional fees 4,548 Net income 79,181 67,935 81,686 Net income (loss) auributnble to noncomrolling interests (9 (1,627) (1,906) Net i11come atmbutable to member's equity s 79,162 s 69,562 s 83,592 Sec notes to consolidated financial statements.

Tnhls of('ontcnts TMX FINANCE LLC AJ'\,'0 AFFILIATES ConsolitL1!cdSt.1lcments of Member's Equity and Noncontrolling Interests For the Years Ended Dccrmhc>:r31. 2012,lQ!landM!l.Jl {in thousands) Tala!

M~mber's E:quHy ~nd Noneonlrol!ing Noncontrclling &tu!tv lnteruu lnlercsls Dal:mce, Qc:ccml!cr 31.2009 s 133,198 s (1,924) s 131,274 Net income (loss) 83,592 (1,906) 81,686 Contribulions 3,146 420 3.566

0666 Distributions (74,060) (1,330) (75,390) Balance, Dccsmhcr 3 I. 20 I0 145,876 (4,740) 141,!36 Net income (loss) 69,562 li.627) 67,935 Consolidntion ofvnrinb!c interest entities 221 221 Distributions (12,954) (12,954) Balance, Qscemher 3 I. 20 II 202,484 (6,146) 196,338 Net income 79,!62 19 79,181 Contributions 58,750 58,750 Distributions (22.031) (1,250) (23.281) Bahmte, D('cemiX!r 31. 2012 s 318,365 s (7,377) s 310,988 See notes to consolid:ucd financial statements.

I11hle of Content~ Tl'viX FINANCELLC AND AFFILIATES Consolidated Statements ofCnsh Flows For the Years Ended O~cemhcr31. 2012,2011 and2010 (in thousands) 2012 20Il 2010 Cash Flows rromOperatingAcli\itics Net income s 79,181 s 67,935 s 81,686 Adjustments to reconcile net income to net cash provided by opemting acth·ities; Provision for loan losses 144,749 99,542 63,932 Depreciation and amortization 17,210 13,813 10.353 Amonimtion of discount, premium, debt issuance and upfront lease costs 3,832 3,887 2,230 Amortization of acquired in:timgibles 140 160 Net loss on disposal ofpropeny and equipm::nt 427 128 264 Loss on disposal ofaircraft held for sale, net of selling expenses 13 Oumges in assets and !inbilitics: Interest receivable (6,538) (8,082) (7,462) Other assets (14,778) (7,288) {1,256) Net change in loan origination costs {887) {690) {979) Accounts payable and accrued expenses (I,QI5) 5,754 27,430 Net cash provided by operating nctivities 222,321 175,159 176,211 Cash Flo"s fromlmt:sting Acthitics Net title loans originated {210,370) (205,098) (129.572) Payments for acquisitions, net ofcash :~cquired {8,032) {400) Purchase ofproper1y and equipment (41,128) (32,409) (18,713) Proceeds from disposal of property and cquipnwnt 823 399 112 Proceeds from sale of<~ircrnfl held for sale, net ofscllillg expenses 12,700 Purdnlseofaircmfl. (17,657) (lncrcnse) decrease in restricted cash (4,325) (3.525) 846 Issuance of note receivable from Sole Shareholder (2,000) Receipt of payments on note receivable from Sole Shareholder 472 418 33 Cash from consolidation ofCSO Lenders 1.794 Net cash used in investing ncti\•itics (254,528) (246,453) (154,651) Cash FlO\IS from Financing Acthilics Proceeds fromseniorsccured notes 64,200 247,695 Proce~::ds from revolving credit facility 25,000 Proceeds from notes payable to related parties 12,000 17,750 Proceeds from notes payable issued by consolidated CSO Lenders 15,307 9,080 Proceeds from notes payable 12,376 Repayments of notes payable to related parties {SS4) (13,844) (5,647) Repnyments of notes payable and capital leases {1,797) (667) (14,762) Payments of debt issuance costs {611) (2,291) (17,195} Repayments oftcnnloan, net {151,000) Proceeds from contributions to consolidated CSO Lenders 76 Proceeds from contn'butions 58,750 3.566 Distributions by consolidated Vllriable interest entities (1,250) Distributions to Sole Sh<~rehold~r (12,704) {75,390) Net cosh provided by financing activities 55,850 5.017 Net increase (decrease) in cash and cash equivalents (15,444) 26,577 Cash and cnsh equivalents at beginning of period 53,585 27,008 Cash 1111d cash equivalents at end of period s 38.141 s 53,585 See notes to consolidated financinl sttltcments.

0667 Ti!h!e ofCnn!ent.<: Tl\1X FlNANCELLC M'D AFFU.lATES Cons:olhL1ttdStatements of Cash F1011S, continued (In thousantls:) 2012 !011 !010 Sugiemcni:ll disclosure ofc:J.Sh flow information: Interest pilid s 45,%2 s 38,251 s 7,694 Leasehold improvements dlstn1mtcd to Sole Shareholder s s 250 s Suf:P.emental disclosure ofreorganizntion items: Professional fees pnid for sen• ices rendered in connection with the Chapter II proceeding: s s 6,457 See notes to consolidated financial statements.

Tnh!c ofContcnt~ TMX FlNANCELLC AND AFFD..IATES Notes to Consolidated Financial Statements (1) Nature ofBusincss, Princi)lies of Cons olldation and Significant Accounting Policies

TMX Finance LLC and affi!i:~tes (collectively, unless the conte.\1 inditatcs otherwise, the ··company") is a specially finance company that originates and servites automobile tille loons through 1,035 title-lcndillg stores in 12 stoles as ofD.!ccHlhcr ::n 2012. Afftli~tes include wltoUy-owned .o:uh~idimiM ~nd consolidated variable interest entities ("VIE:;") ns described Uelow. The Comn~nv operntes as TilleMaxin 831 stores, and in ]51 stores, !h!! Conm;mv operntes under n Tit!eBucks Urnnd. ·nu'< Conmmw also offers a second lien nutomobi!e product in Georgia <md Florida, with operotions conducted within 77TitleMaxstorcs under the Equity Auto Lonn brood, 11nd through 53 standalone stores under the JnstaLoan br.md. The C:omnmw is in the process offully $cparnting the Equity Auto Lonn business into standalone stores undertlte TnstaLoan brnnd with separate management and the addition of other Joan products. Segment infotm:ltion is not presented since all oflhe ('omp:111v's revenue is attributed to a single reportable segment: specialty linanci~l services.

TMX Finance LLC changed its name from Tit!cMaxHoldings, lLC to TMX Finance LLC effective hme 11 2010 Effective Santemher ;;o 2012, the fonnersole mcmbcrofTMX Finance LLC tmnsferred 100% of his membership interests to TMX Finnnce Holdings Inc, ("Parmi") in e~hilnge for shares of~;ommon sto~;k in the Parent. The former sole memberofTMX Finan~;e LLCis the sole beneficial ownerofthe common stock ofthe Parent (the "Sale Shm-elwlrlcr"}.

The Comnmw is subject to laws, regulations and supervision in each of the smtcs in which it operates, Most states have laws that spccificaUy regulate the Cnnm;mv's products and services to establish aUowable fees, imerest and other economic tenru. The terms of products and services offered by the Conmmw vary between states to comply with each state's specific laws ond regulations. lu llddition to state laws and regul:Hions, the Comnnnv's business is subject to vario\)s local rules and regulations such as zoning regulation and penni! licensing.

The interest rntes and fees for th1~ rnmnany's products and services arc not currently regulated directly at the fedcrnl level, but laws and regulations l!Oveming the business arc subject to change. On Ju\v 21 2010, the Dodd~Frank WaU Street Refonn and Consumer Protection Act was enacted into law. This net established the Consumer Financial Protection Bureau ("CFPB'')as a federal authority responsible foratlministc1ing and enforcing the laws and regulations for consumer linanciol products and services. TI1e legislation docs not specificoUy target title lending, traditional pnwn or instaUn1tnl lending for CFPB regulation. However, the CFPB is currently in the process of developing rules that could subject lilt ~to some fonn ofrcgul~tmy oversight. TI1e CFPB is specifically prcihibited from institutin~; federnl usmy interest rnte cnps.

Princin!es ofCnn:;o!jdatjon TMX Finance LLC is ll single member Delaware limited liability company that, through its suh~jdipries, is engaged primarily in the origination t~nd servicing of automobile title loans.

In Apri12006, the Sole Sharcholdcrfonncd EAl. On June '1 '010, the Sole Shnrcholdertransferrcd IOO%ofhis membership inter~ts in E.A.Lto TMXFimmca LLC. The Cnnmmw consolidated EAL effective lmpHlr.' ! 1010 in accordonce with accounting stnndards related to consolidation. This transfer between entities undcrconunon comro! has been accounted for at the historical cost of the n~sets llnd liabi!ith~$ transferred.

TI1c Conmnn\' conducts bu$iness in Tc.'Qs nnd cc11nin other stntcs through whoUr-owned ~nhsirljnries each of which is registered in the applicable state ns a Credit Services Organization ("CSO'l111cse CSOs hnve enterad into credit sen• ices org~nization asrccmcnts ("CSO Agrt:cmcnts") with third-party lenders {the "CSO L<:ml~rs") that make the loans to our customers. The CSO Agreements govern the tenns by which the Conmnn\' performs servicing functions nnd refers customers to the CSO l.enders for a possible e>.1ension of a loan. The ('ompa1w processes loan applications and corrunits to reimburse the CSO Lenders for:~ny loans or related fees that are not collected from those customers. Two oft he CSO Lenders opcrnte on nn exclusive bnsis with the; ('omnnnv, nnd the C'onmmw hns dctcnnined that they are VIEs ofwhich the C'onmnnv is the priin:uy beneficial)'. Therefore, ill£: C'omnanv has consolidated the5c VIEs.

Tnhle of('nntcnts TMX FINANCE LLC AND AFFILIATES Notes to Consolidated Financial Sla!ements (1) N:~ture of Business, Principles ofConsolitbtion and Significnnt Accounting Policies (continued) The ('nmnanv is associated with several other entities that it must eva!unte as potential variable interest entities. TY Investments ( "11'/") and Pnrker~Young ("PY} are owned 100% and 50%, respectively, by the Sole Shareholder. Each ofthese entities 0\\1\S ccrtnin real estate that is leased to tlu~ ('omponv. The Compmw cvalunted these entities and detcmlined

0668 that th¢ C':onmgnv does not have a variable interest and that neither has characteristics of11 variable interest entily pursuant to the applitllble accounting guidance. Both entities have sufficient equity ~~risk without the need for any additional subordinated financial support. The Cnmn:mv has therefore determined thnt TYI and PYare not \'oriablc interest entities.

TitlcMaxA viation, Inc,, a Deh1ware corporation (':4vfal{on "),and TitleMaxConstruction, LLC{"Colls/mcrion ")are otlterentities evaluated as potential variable interest entities.

Aviation is owned by our Parent nnd has three aircraft and rel~ted debt. Tite aircraft are used by the Comonny to conduct its business. The Conmany and certain ~uhsidiaries guarnntee certain debt of A vintion. Construction is owned by the Sole Shareholder and directly handles the store improvement work for the Comnany. Aviation and Construction are VIEs ofwhich the Compnnv is the primary beneficiary; therefore, these entities have been consolidMed.

SignjfiqnJ Accounting ?oHcje~

The accounting" and reponing policies oft he C'omnml\' are in accordance with accounting principles generally accepted in the United Stntes of America and coRfOilll to gcnerol practices within the consumer finance industry. The following is a description of significant accounting policies used in preparing the consolidated financial statements.

DaslsojPrcs~:11tatiou

11Je accompanying consolidated financial statements include the accounts oft he C"omnrnw, its wholly-owned ~uhsidinries and its consolidated VIEs. A !I significant intercompany transactions and balances have been ctinUnated in consolidation, Us!! ojEsflmates The prepamtion ofconsolid<lted financial statements in confomlity with nceountins principles generally accepted in the United States of Am: rica requires management to m.1ke cstiln;~tcs and assumptions that affect the reported amounts of <Jssets and liabilities and disclosurll of contingent assets <Jnd liabWties at the date ofthe consolid<Jted financial statements <Jnd the reported lln>OUnts of income <Jnd e:-.:pcnses during the reporting period. Actunl results could differ from those estimates. Material estimates that are particularly susceptible to change relate to the detennination ofthe allowance for loan losses and the valuation ofrepossessed assets.

Cash and Cash Equ/l•alents The Conmnnv n\a~tains amo\mts in bank accounts which, at times, may exceed fedemUy insured limits. The C'omnnnv h<Js not e:q:~erienced losses in such accounts Management believes the ('(lmnanv's exposure to credit risk is minimal for these accounts.

Gooc/wi/1 ond lutangrblc AssC!ts Goodwill and indcfinitc-Hfc: intangible assets ~cquired in a busine~s combination are recorded using the acquisition method of accounting and are tested for impairment annu<JUy, or more frequently ifcircurnstnnces indicate potential impairment, on a reporting unit level. In testing forimpnirmcnt, the C'nnDJanv first assesses qu<llitntive factors as a basis for detennining whether it is necessary to perfonn the two-step goodwill impainnent test. The lir.it step of the i111painncnt test, if necessary, is to compare the estimated filirvalue oftlte reponing unit to its canying V<Jlue. lftlte fair value is less than the canying value, then a second step is perfonned to deten11lnc the fair value of goodwill and the amount of ilnpainnem loss, ifony. In <Jddition, intangible assets wi!l1 fmite lives me amort ired over tlu::ir estinl.'lted useful lives and reviewed for impainncnt whenever events or circumstances indicnte the c;mying value Jli..1Y not be fi.1Uy recovcmbl~.

Tnhle ofConr•·nt~ TMX FINANCELLC AND AFFILIATES Notes to ConsolitJatcd Financial Statements (I) Nature of Business, Principles ofConsolill:ltion nndSignifitllnf Accounting Policies (continued) Loan Lo.ucs Provisions for Joan losses are charged to income in amounts sufficient to m:lintnin an adequate allowance for lonnlosses and an adequate accrunl for losses related to guaranteed Jonns processed for our unconsolidated CSO Lender. Factors used in assessing the ovcrnlladequacy of the allowance for loan losses, the accrual for losses related to gu11ranteed loans processed for ouruneonsolidated CSO Lender and the resulting proYision for Joan losses include lonn loss e;..perience, contrnctual delinquency oflitlc loans receivable, economic and other quali1:ltive considerations nnd management's judgment. While management uses the best information available to make its evaluation, future odjustments to the allowance m.1y be necessary ifthere <Jre significant changes in economic conditions. Thi! C't'ul1flnnv charges-offan account when the cnstotneris 61 days contrnclmllly past due.

Loan OrigillatfOII Costs Direct costs incum::d for the originntion of loans, which consistm1lnly of employee-related costs, :~re deferred and recognizx:d as a reduction ofthe rek1ted imerest :md fee income over the overoge life oft he loon using a method that approximates the interest method.

The lompnnv lllliY initiate repossession proceedings according to the respective stote low if an account becomes past due. Repossessed collateral is valued at the lowerofthe receivable bal~nce oft he Joan prior to repossession or estinmted net renlizable value. Manogement esti/1\'ltes net realizable value as the projected cash value 1rpon liquidation less costs to sell the related collater.tl.

Property oml Equipment Propeny and equipment, including capitalized interest, ure cunied <Jt cost. The cost ofpropeny retired or sold and the related accumulated tlcpreciation are rt:moved from the accounts, and any resulting gain or loss is recognized in the consolidated st:~tements ofincome. Depreciation of property and equipment is provided by the straight-line method over the estil\\'lted useful lives of the assets once they nre placed in service, as shown in the chart below. Leasehold in1provements :~re <Jmortized using the stmlght-line. method ovcrthe lesser oft he useful lives ofthe inlprovements ortlle life of the lease. Repairs and mainten11nce are e.~,pcnsed as incurred.

U•cful U\l:S fyear:sl Computers and software 3 to 5 F'umilUreand fi:11ures 7 Leasehold improvements {:1) ' Signs Vehicles ' 0669 Aircrnft 15 Capi!tlllease assets-buildings {b) 15 Building 30

(a) Leasehold improvements are depreciated over the tenns oftl1e lease acreements with a maximum or five years. (b) T11e depreciation C.'l:jlcnse on assets acquired under capital leases is included with depreciation el<.pense on owned assets.

lmpairmml ofLollg·Livr:d A.vsals The Cnnmnnv annually or more frequendy, irappropriate, evaluates whether events or circumstances have occurred that indicate tl1e currying amount orlong-lived assets may warrant revision or may not be recoverable, When fuctors indicate that these long-lived assets should be evaluated for possible impairment, !h¢: Conmpnv i'!Ssesscs the rc:coverability by detemtining whether the canying value or such lontHived assets will be recovered through the future undiscounted cash flows e).pected from uses orthe liS sets nnd their eventu:d disposition.

Tnh!e nfC'onh:nls TM.:.X.FINANCELLC M'D AFFILL\TES Notes to Consolill:ited Fimmdal Stltements (1) Nature of Business, Princlplcs ofConso!hlation and SigniOcnnt Accounting Polidcs (continued) Dehtlssuunce Cos/.~

Costs incurred to obt;,in debt financing are amortized over the lire oft he related debt using a method that appro:-jmates the interest method. Amorti2ation is included as a component ofinterest e1.pense in the consolidated statements of income.

Income Recognition Interest and fee income is recogniZI:d using the interest method. Accrual or interest and fee income on title loans receivable is discontinued when no payment has been received for dnys or more. The accrual of income is not resumed until the account is Jess than five days past due on a contractual basis, at which time manag.ement considers collectability to be probable.

A(/vr:rllsing Costs TI!c; Comnonv incurs advertising costs principally related to advertising on television, the internet, billboards tmd yellow pages. These costs <~re expensed as incurred.

Income Ta~cs and Distribmion.r The Cnrmnuv, with the consent ofthc Sole Sharel1older, elected in prior years to be ta)ll;d under sections of the federal and state income tax laws, which provide that, in lieu or co~porate income ta)ll;s, the Parent separately accounts for the C'nnma1w's items orincome, deduction, losses nnd credits. The consolidated financi~! statements generally do not include a provision for income taxes as long as these elections remnin in effect. Certain snh~illinrie~ operate il1 stntes that impose nn entity-level tax that is n percentage ofincome.

Given she Comno1nv's income tax elections, the assets and liabilities with significant estimated net differences between the tnx bases and the reponed amounts are presented below as ofnecemher 11 2012 and 1illJ.. The cstim<11cd net differences disregnrd the assets and !i<Jbilities orthe consolidated CSO Landers.

The tax bases were less than the canying amounts as follows: in !hcmsands 2012 201t Title loans receivable, net s {25,763) s (27,812) Property and equipment, net {71,023) (47,1<12) Goodwill (5,975) (5,975) Total estinmted nilt differences s (102,761) s (80,929) While !he Cnmnmw's tax status and income tax elections ro:m.ain in effect, !he Conm.1nv may occasionally 111Jke distribulions to the Parent in mnounts sufficient to pay some or aU of the t:n.:cs dnr! on the f'nmnnnv's items ofincome, deductions, losses and credils. The lmlJ!Hmy anticipates nnking distributians of$23.0 to 526.0 million to the Parent to pay 2012 federal and state income ta;o..:es. The Cnrnpnny ~my make future dislributions to the Parent in ;~ddition to those required for income taxes. To the enent distributions are pennitted under the !enn.'i orlhe indenture governing the f'ompnnv's senior secured notes, distributions from the rmnprmy to the Parent will provide the prirnmy menns for the Parent to make interest payments on its $100.0 million or 11.0% senior notes issued in October 2012 and due in October 2015. The maximum potential amotmt of distributions for purposes ofruudiug the Parent's interest payments is $11.0 million for each orthe years ending Dccemher:: 1 201:: lQl:! and .Nli At Dccemher :.1 2012 the availability ofpenni1ted distributions for purposes other than estimated ineome 111xpaymcnts was approxim.'l.tcly S5.0 million (calculated net ofan estimate for income !ax distributions).

Plralllom S!ock /'I an The C'nnmarw accounts for share-based employee compensation by measuring aU share-based payments to employees using the intrinsic value method and recording the resulting e;o;pcnse in the consolidated statements of income. Ih¢ Cnnmanv measures the liability ror grants ofphatttomstock by using an agreed-upon calculation defmed by the terms ofthe phantom stock plan.

Tahle nfC'onte!lts Ti\IX FINANCELLC M'D AFFJLIATES

0670 Notes to Consolid:Jtcd Fin:mcial Statements (1) Nalure of Business, Principles of Consolidation and Significant Account!ng Policies (continuetl) Recent Accounting Standards In October 2012, the FASB issued ASU 2012-{)4 to provide technical corrections and improvements to a wide runge ofTopics in the Accounting Standards Codification, including conformin; amend menu related to fuir value measurements. The amendments in this guidance will be effective for fiscal periods beginning after Dcccmhcr I5 "OJ"· The adoption of this guidance is not Cllpccted to have a material impact on thg Commmy's financial position, results ofoperntions orcc.sh flows. (2) CreditQu~lity Information,AllOl\mlcc for Losses on Tille Loans Rccdw.Ne and Liability Related to UnconsolidntcdCSO Lender Loans The Commmv loans cosh to customers in c~h:mge fora fee and an agreement to repay the amount loaned. The Comnnnv's loan portfolio includes ba!~nces outstnnding from all title loans, including shorHcnnsingle payment loans and m11lti-payment installmcnt loans. The Commmv utilizc;s n WJ.ricly ofundcrwriting criterinto specificnlly monitor the perfonnancc of its portfolio oftitle loans and m1intniru an aUowance at a level estimated to be adequate to absorb loan losses inherent in the portfolio.l11e ~Uowance forlosses on title lo~ns rccciv:~ble is presented in the consolidated balance sheets. In addition, tht! Compnnv maintains a liability for estimated losses rein ted to lo~ns processed forth!! Comnnnv's unconsolidated CSO Lender that are guaranteed under CSO Agreements. The li~bility for estimated losses related to th~se guaranteed loans is included in accounts payable and accrued e;q1enses in the consolidated balance sheets.

The rnnm~nv does not stratify the title Joan portfolio wlum evaluating pcrfomumce ofthe loans. Rmher,the total portfolio is assessed for losses based on contrn.ctunl delinquency, the value of underlying coUateral, economic and other qualitative considerations and management's judgment. The Comnmw uses historical collection perfo!m'lnce adjusted for recent portfolio performance trends to develop the e:q~ected loss rntes used to establish the allowance and liability for loan losses. Increases in the allowance and liability for loan losses are recorded as provision for loan losses in the consolidnted statements ofincome. TI1e Cgmnnnv charges-offan account when the customer is 61 days contrnctually past due.

01arge-offs on title loans receivable are equal to the loan balance (including interest and fees). Recoveries on losse~ previously charged to the ollowance nrc credited to the aUowance when collected.

Delinquency e~erience oftitle loans receivable at D~ccmher:; I 2012 and lQ!! was as follows: in lhous:utds 1.012 21HI lv30 days past du~: s 91,699 s 57,494 31-60days past due 16,471 11,291 Total past due 108,110 68,785 C\nretlt 469,002 421,308 Total s ~77.112 s 400,093 Title loans receivable on the consolidated balance sheets is net ofuneamed interest and fees ofS3.9 million and 52.9 million as ofQecemher::t 1 :!OP and l!1l.L respectively.

Accrual ofintercst and fee income on title loans rcceiv~ble is discontinued when no payment has been received for35 days or more. The accrual of income is not resumed until the account is less than five days past due on a contrnctual basis, at which time management considers collectability to be probnble. Title loans receivable in non-accrual st3tus at Oect>mher31 2012 aud 1illJ. were ns follows: in 1houunds 2012 2011 Nonaccrualloans s 84,520 s 54,198

T:~hle ofC'o!l1cn1s T/\1X FINANCE LLC Al\'D AFFILIATES Notes to Consclid:Jtcd Fimmd:ll Statemen(s (2) Credit Quality InformtJ.tion, Allow;mce for 1-Gsscs on Title Loans R~cchnNc and Liatility Related to Unconsolidated CSO Lender Loans (continued) Changes in the nllowance for loon losses for the years cnclcd Oec,•mher] 1 2012, JOil and 2Q!Qwere as follow~:

in th~u,.mds 1012 20ll 2010 Beginning balanr.:e s 73,103 s 52,0.!8 s 40,280 Provision for loan losses 141,145 98,536 63,932 Otarge-offs (162,222) (103,552) l70,932) Recoveries 26,071 18,768 Ending balance s 73,103 s 52,048 Olilnges in the liability for losses 011 loans processed for the C'onmnnv's ~lflconsolida1etl CSO Lender for the years ended Deeemher; I 10t? and lillJ. were as follows: in 1housnntl5 2012 2011 Beginning balance s 1,006 s Provision for loan losses 3,604 1,006 Ending balance s 4,610 s 1,006 Tite aggregate provision for loan losses for the years ended Dece!l1hcr 3 I 20!2, ;mu and 2Q.ll! was Sl44,749, S99,542 and $63,932, respectively. (3) Conccntr:~tian afCredit Risk Th£ C'onmanv'~ portfolios of automobile Iitle loans rec~;ivable are with consumers living primarily in Ckorgia, Alabama, South Clrolina, Tennessee, Missouri, r.. !ississippi, V~rginb, Te;~;~s, Illinois, Ne\'ada, Arizona and Florida. Const>!]uently, such consumers' ~bililies to honor their co111mc1~ mny be affected by cconomie conditions in these areas. The C'onmanv is C;qlOscd 10 a concentration of credit risk inherelll in providing altemnte financing to borrowers who cannot obtain trnditional bank financing. In tht> event ofdefuult ofthe title loans receivnble, rhe C'omrmnv has aect:ss to automobiles supporting these title loans receivnble throu~;b repossession. As of!Rcemher :>!. ,01" aU title loans receivnble were collateralized by the rdated consumers' ~ulomobites. The ability to repossess coUateml mitigates this risk At nccemher 31 2012 npproximate!y 36%, !4%, 12% and ! !%oftitlc loans

0671 receivable were in'Ckorsia, Abbam!l, South Carolina and Tennessee, respectively.

The C(lmnnnv also has a risk that its customers will seek protection from creditors by filing under the bankruptcy laws. When a customer files bonkruptcy, the C'ompnnv must cease collection efforts and petition the Bonkruptcy Court to obtain their coll~teml or e~tablish 11 court-approved b11nkruptcy plan involving the CcuttrMm· and all other creditors oft he customer. It is the C(lmn;mv's C).:flerience that such pions can take om en:ended period of time to conclude und usuully involve a reduction in the interest rate from the rntc in the contrnctto a court-approved rntc.

TnhleofC(Intcnts n.IX FINANCELLC AND AFFILIATES Notes to Consolidated Finnncial Statements (4) Property and Equipment Propeny and equipment at nccemhl'r ~I ,012 and l!ll! consisted oft he: following: in th~uunds 2012 2011 Leasehold improvements s 55,009 s 39,165 Computers and software 26,667 23,569 Aircraft 23,288 23,288 F'umiture and fi:o:tures 20,761 15,370 Signs 19,971 15,792 Assets not placed in service 17,456 7,022 ASSI!tS \Uitlercilpitallcases 2,240 2,240 Vehicles 335 339 Building 2BS Land ;o Subwtal 166,082 126,785 Accumulated d.:prccialion and amortil<ltion {70,843) {54,214) Net property and equipment s 95,239 s 72,571 Capitalized interest at Deecmher:; l ?OJ, and 20!! was S0.9 million and SO.S million, respectively.

During the second quarter of20}2, the lonmnnv tempornrily decided to stop development ofn new proprietary store software system and e>.plore other options for its store software solution. As ofDecemher J I 2012, the C'mllP:lllV is continuing to evalul!te the best lOli!Henn solution for its store sofiwnre systelltl! is reasonably possible that !he f'omnnnv could decide to implement t1 different store software system in the neartenn This decision could require the C'omr!il!w to reevaluate the canying amount oft he proprietary store software system, which could result in none-lime, non-cash e:>.pense that could rnngc fromS13.0 miWon to SIS.O million. (5) Other Assets Other assets at Decemher 31 ,01., and 2ill.! consisted of the following; In thouunds !011 !OIJ Deposits related to unconsolidntcd CSO lender 9,230 s 2,112 Restricted cash (a) 8,600 4,275 Repossessed assets 6,355 4,78S Prepilid rent 4,887 1,857 Deposits, primarily on leased office space 4,671 3,071 Other prepaid e;o,penses 3,413 2,349 Sign and supplies inventol)' 1,605 1,327 Other 985 1,218 Total other assets s 39,746 s 20,994

(a) The Comrmnv deposited money in accounts that were restricted to satisfy various stntc licensing requirements.

•14

Tnhle ofC'cmtent~ TMX FINANCE LLC AI'\'D AFFILIATES Noles to Consolid:!.led Financial Statements (6) Acquisitions In Mny 2011, ]he lomp:mv acquired nil of the title loans and assumed all of the opemting lenses related to J91ocations in Nevada for an aggregate cash purchase price of$6,8 million.

The C'omnnnv recorded goodwill ofSS.O million as a result ofthis trnnsaction. In addition, tl1e Cmnnnnv allocated S0.3 million of the purchase price to customer relationships, which was ilmortizcd over 15 months. Amortiztttion ofthe custonwr rela!ionships intangible asset ll':tS SO.! million and S02 million during the ye:trs ended Oeccmhct· '\I 201, ilnd 2ill.L respectively, and is included in other operating and administrntive e:q,enses on the consolidated statements ofincon~.

0672 In July 2011, the Comhnnv acquired all ofthe tit !I: loa us and assumed aU ofthe opernting leoses related to eight1ocations in Missouri ond six locations in Nevada for an aggregate cash purchase price ofSl.6 million, Th!! C'mnprmv recorded goodwill ofSI.O million ns a result of this uansattion.

The goodwill thot resulted from these transactions reflects the fact that the trnnsactions expanded the Comrmnv's number of stores and provided a presence in a new market. (7) Senior Secured Notes, Re,~hing Credit F:u::ility and Notes P:~yatie

Senjor Secuf<!_cl Note~

On hme 21 2010, TMXFinance LLCand TitleMaxFinance Corporation, as co-issuers (the "Issuers''), issued S250.0 million ofSenior Secured Notes {the "2010 Notes") nt99.078%of par. ihe 2010 Notes mature Julv 15 20Js and bear interest 111 13.25% per year, payable semi-annuaUy, in arrears, on July IS and Januacy 15 of each year. The discount ofappro>funtely $2.3 million is being accreted overthe life ofthe 2010 Notes as a component ofinterest e).llense using t11e b1terest method. The accretion of discount was SO.S million, SO.S million and S0.2 million fortheyears ended neccmbcr 31 2012,2011 and 2010, respectively.

On Julv 22 2nll,the Issuers issued S60.0 m.i!Jion aggregate principal amount of their 13.25%SeniorSecured Notes du!! 2015 (the "2011 Noles"), TI1e 2011 Notes were issu~d with tcnns substantially identical to the 2010 Notes and at 107% ofpar for a S4.2 miUion premium, which resulted in gross proceeds 10 the C'omnnnv ofS64.2 million. The premium is being amoniJ.c:d over !he life of the 2011 Notes as a component of interest eJ.pense using the intert!SI method. The amortization ofprenrium was Sl.l urillion and SO.S mil!ion for the years ended Decemh,;r 31 2012 and 2011. respectively.

In connection with the issuance oflhe 2010 Notes and 2011 Notes (collectively, the ''Norc~·"), the Cnmpmw copitoli.zed approximately Sl9.5 million in issuance costs, which primarily consisted ofunderwriting. fees, legn! fees and other professional expenses. TI1e issuance costs nrc being amoniJ.ed over the life ofthe Notes as a componenl of interest ellpense. The nmonimtion ofissunnce costs related to the Notes was S4.0 nullion, Sl6 miUion and $1.8 million forthe yen~ ended Qecemhcr]l 10p, 2!lll and 2Q.ll, respectively.

Tlle Iswcrs mt~y, nt their option, redeem some ornU ofthe Notes on or after Jufv I 5 "'nl :>at tl1e redemption prices {expressed as percentages ofprincipnl amount) set forth below, phls accrued and unpaid interest to the redemption date.

Vur 2013 (06.625% 2014 and thereafter 100.000% Prior to Jul\' 15 2013, the Issuers may redeem up to 35% of the aggregate principal amount of the Notes original!y issued at t1 redemption price of 113,25% ofthe principal amounl of the Notes redeemed, plus ac~;"rued and unpaid interest, ifnny, to the redemption date if: such redemption is made with the proceeds of one or mor~ equity offerings; at least 65% ofthe aggregate principal amount ofthe Notes originnlly issued remains oulstnnding immediate!}• nfter the occurrence of such redemption; and the r~demption occurs within 90 dnys ofsuch equity offering.

Tnh!g nfContcnll:.

TMX FINANCE LLC AND AFFILIATES Notes to Consolidated Financial Statements (7) Senior Secured Notes, Re,ohing Credit Fncility antl Nl)tcs Pnynl.ie (continuetJ) The C'omnrmv must make e:'(Cess cosh flow offers in the first quarter of each year forthe lcsserof$30.0 million or 75% of e:-t:ess cash flow as defined in the Notes. TI1e redemption offer price is 102% ofthe principal amount oft he Notes. The C'omn:mv made an e;.;cess cash flow offer in March 2012 at 102% ofthe principal amount ofthe notes. Tile offer expired in April and no holders ofthe nOto:ls accepted the 2012 e:ol:ess cosh flow offer.

The Issuers entered into registration rillht~ agreements and were required to file registration statemants to exchange the Notes for substantiaUy identical registrnble notes. The Notes require the Issuers to post consolidated financial stntemcnts and Management Discussion and Analysis ofFin;mcial Condition nnd Results ofOperntions on its W<;h~ite or with the Securities and E'([:hange Connnission ("SEC") within 60 days of each quarter end anti within 90 dnys of each yearend. In addition. the Issuers must provide current reports for material items and must hold and participnte in quarterly conference caUs wilh holders ofthe Notes.

The Issuers may incur unsecured indebtedness subject to certain restrictions in the Notes. In addition. the Notes contain covenants that restrict transactions with affili:Hes, repayments ofsubordinated debt, distn'butions to the Sole Shareholder, compensation for the Sole Shareholder and relatives, the incurrence ofliens, the issuance of dividends and the sale of assets. According to these covenants, effective Jnlv I ?010, gener.~l distnbutions to the Sole Sharel1older are permiltcd under certain circumstances n11d are limited based on certain restrictions as defined in the Notes. At Decemher Jl 2012, Ihe availability ofsuch distnbutions to the Sole Shareholder was SS.O million under the terms ofthe Notes. I!!£ C'ompryny is in compliance with the covenants of the inrlcntnrc goveming the Notes as ofOecemhcr 31 101"'.

Revo]vjnp Qerli! F<1cilitv On June ?7 1012, Tl\'fX Finance LLC and Titlel\·IaxFinance COTporation entered into a credit agreement (the "Cn:clil Agrectmmt") that provides a senior secured revolving credit facility of up to 525.0 million (the "R1.•vo/vi11g Cr.!dit Facilily") that 1113tun::s June 1S 2015, Borrowtng~ tmderthe Revolving- Qed it Facility be~r annual interest at LIBOR plus 8.5% with a LIBOR floor of 1.5%. The Credit Agreement contains certain restrictive covenants that are substantially similar to those in the illik!!.!.!!rs governing the senior secured notes.

The Credit Agreern:nt also contains a financial covemnt that requires the m.1intenance ofa minimum !ill:d charge ratio of2:l. In connection with the completion ofthe Credit Agreement, the Conm~nv cnpiti!liH:d appro:cinutely $0.6 million in issuance costs, which pri1113rily consisted oflegal fees and other professional e;openses. The issuance costs are being amortized over the life ofthe Revolving Credit Facility as a component ofinterest expense. The amortization of issuance costs related to the Revolving Credit Facility was SO.I million for the year ended Dec~tmher1! 101'.

Nnte~ PayghJc The C'omrnnv had notes payable of$37.3 nul lion and Sl1.4 million at December 31 2012 and 2011, respectively. Notes payable at Oeccmher Jl 2012 includes three notes payable by TMX Finance LLC, t1 note payable by Aviation and 63 notes issued by our consolidated CSO Lender.s.

The three notes payable by TMX Finance LLC are in the amounts ofS6.0 million, SS.O million and S\.0 million, and each bear.s interest at 13.0% with interest payable monthly. Tite principal amount of each ofthese notes is due in July 2013, although the SS.O million note nnd SJ.Omillion note rn:J)' ench be e;\lcnded for up to one odditionnl yearn! the Conmmw's

0673 sole discretion.

The note p<~yab!e by A vi<~tion has 01 principal b01lance ofS0.4 million as of December 31 2012and bears interest at 4.4% with payments ofprindpoland interest due monthly.

Our tonsolidated CSO Lenders had a total ofS2S.O million ofnotes payable outmoding as ofDccemher ::-1 "012. These notes bear interest ranging from 10% to IS% and allow the consolidated CSO Lenders to take one or more dmws up to a total ma)cimumprincipal of$29.0 million. The aggregate principal amount ofaU oflhese notes i.s due in 2013, but 22notes with om aggregate principal amount ofSII.9 million available for borrowing have automatic annual renewal provisions. The effect ofthese renewal provisiom has not been reflected in the debt maturities table below. One of the consolidated CSO Lenders has issued si.xnotes payable to its sole member with an aggregaJe balance ofSS.&million as of December :\1 2012.

Table ofC'C\ntent.<: TMX. FINANCE lLC AA'D AFFD..IATES Notes to Consolidated Finlllldnl Statem~nts (7) Senior Secured Notes, Remhing Credit F:tcility :md Notes P:ty:~ble (continuctl) Notes P:tvflhle to Rel;,tecl Pi!rtie~

The ('onmanv had noles payable 10 related parti~s ofS19.6 rru1tion and $20.5 million a1 D••ct•mh¢r 3! 'l01? and 2Qli, respetlively. Notes payable to related panics at Dec¢11111er 'il JOI" in dudes three notes payable by Avi;~Jion Jo the Sole Shareholder in the amounts ofS2.8 million, Sl L<l million and SSA million. The $2.8 million no!e bears inlcrest at 6.33% and is payable in mmuhly installments of$35,000 with a final payment ofS2.1 million due in October 2015. The SIJA million nole bears interest at 5.12% and is payable itt monthly installments of$104,000 with a final paynren! of$8.4 million due in December 2016. The $5.4 million note bears interest at 10% pay<1b!e monthly, wiJh the full principal amount doe in December201S.

Debt maturities during each of the ne1J five years ending December 31 nre as follows: in thollnnds %013 1014 lOIS 2016 1017 Tat~!

Senior secured notes payable s s s 310,000 s s s 310,000 Revolving credit facility 25,000 25,000 Notes p:1y:1ble 12,031 32 33 35 24S 12,376 Not~s paynble to Sole Shareholder 937 988 8,508 9,195 19,628 Notes payable issued by consolidated CSO Lenders 24,%0 24,960 Total s 37,928 s 1.020 s 343,541 s 9,230 s 24S s 391,961 =rum Senior Secured Notes TI1c: Notes are fully and unconditionally guaranteed, jointly und severally, on a senior secured basis by the Issuers and each oftheire},j'sting and future domestic resuicttd suh~jdinrics, otherthi'ln immaterial ~uhsjdjmJc.~. This: l.!uar.mtec: arose from the issuance of the Notes for the purpose of additional fimmcb1g. The Notes 11re secured by firs.t•priority liens on substantially all oft he Issuers' nsscts 11nd require pcrfornwucc under the gunrnntcc if there is 11 def11ult on the Notes. Underthis gnnrnntce, the !Tl.1>imum potcntinhmount of future, undiseounted payments is S433.2 million. The tom:nttanying amount oft he related liability at Dcccmher31 2012 is S310.0 million.

Rc\•ofl•lug C1cdil Facllify SubjccJto certain C>t:cptions, the obligations under the Revolving Credit FaciU])• nre fully and unconditionally guaranteed,joitttly and severally, on a seniorsetured b:~.sis by the Issuers and ea.ch oftheirexisting and future domes lie suhsiclinri>!s. This gunrnll!ee arose from entering into the credit agreement that provides the Revolving Credit Facility for the purpose of additional financing. The Revolving Credit Facility and the guarantees will rank senior in right of payment to all oft he Issuers' and the guarantors' e)lisJing and flLturo subordinated indebtedness llnd equal in right of payment will\ all oft he Issuers' and guarantors' existing and future senior indebtedness, including the Notes. TI1e obligations under the Revolving Credit Facility and the guaruntees are secured by substantially all oft he Issuers' assets, subject to cert:lill limitations. Under this guarantee, the mal.imumpotcntial amoum of future, undiscounted payments is appro:-Jmately S31.4 million. The current canying amount ofthc related liability at D!cemhcr ~I 2012 is S25.0 million.

CSO Agreeml!llls Under the tcmn ofthe CSO Agreements with non•eX~:Ius1\•e third-party lenders, the C'nmnnnv is conu-acJunUy obligated to reimburse the lenders for the full amounts of the loans and cenain related fees that are not collected from the custoJners. In cenain cases, the lenders sell the rel:1ted loans, and the C'ompilnv's obligaJion to reimburse for the full amounts Oft he loans and cenain n:lated fees th3\ arc not collected from the customers cX!ends to the purchasers. Under this gu:mm1ee, the tna;cimum potential amount of future, undiseounted payments is nppro;..inunely S26.9 million. The value ofthe rein ted liability at December 31 "0t 'lis appro»imately S4.6 miUion ;md is included in accounts payable and accrued e;-,pcnses on the consolidated balance sheets and provision for loan losses on the consolidated SH!Iemems of income.

Tnhle ofC'ontent~ TMX FINAI\:CE LLC Al~DAFFJLTATES

Notes 1o Consolit!atcd Financial Sl:ttement:s (7) Senior Secured Notes, Rc\uhing Credit F:lcility :lndNotcs Pay:tblc (coDtinued) Aln:ruft TI1e Sole Shareholder has a note payable to a fmance company originating from the purchase of an airtraft. The note payable is unconditionally and ;~.bsolutcly guaranteed by TMX Finante LlC and certain of its whoUy.owned ~nh~1dinric~. Tile note paynblc is tollaternlized by a security interest in the aircrnft and requires perfonnance under the guarantee if there 0674 is a defimlt on th~! note payable and the collateral and Sole Shareholder's guarantee are not sufficient to pay t11e entire amoul\l of the not~:. The m..1:1imum potential amount of future, undiscoumed payments for the note is $3.3 million. The current canying amount ofthe related liability at D<:ccmh,•r \I ?OJ? is S28 million. (8) Accounts Payalie and Accrued F.xrenscs Accounts payable and accrued e:qlenses <H Decemher 31 ?OJ' and 2!W. consisted ofthe following: in thousands 1012 20ll Interest s 19,749 s 19,085 Salaries and benefits 13,444 15,839 Phantom stock award 9,776 Trade pnyables 11,513 6,567 Rent 5,6S6 4,247 Accrual for losses on loans processed for unconsolidated CSO Lender 4,610 1,006 Taxes payable 2,781 3,595 Other 3,558 2,241 Total accounts payable and accrued cxp~nses s 61,341 s 62,356 (9) Other Orcrnting :mdAdministrathe E':l:rcnse~ Other operating and administrative e~enses forthe years ended Qrcen~ler31 ?OJ?, ;!.Qlland NJ.2consisted of the following: inthouunds !012 2011 2010 Collateral collection expenses s 16,952. s 10,533 s 7,881 Technology services, software licensing and hosting expenses 11,039 5,505 4,062 Office supplies and postage e;.:penses 8,217 6,535 4,639 Recruiting, reloc.1tion and training c)ll)enses 7,079 6,537 1,479 Travel and related expenses 7,033 6,682 4,264 Bank processing fees 2,762 3,325 2,838 Legal fees 2,722 2,385 1,710 Accounting, audit and tax fees 2,056 2,630 1,128 Business licensing e~enses 1,656 1,191 1,021 Other 17,953 13,373 12,385 Total other operating and administrative e>.pcnscs s 77,469 s 58,696 s 41,407

T~blc of('Onl!!J)t~

TMX FINANCELLC AND AFFILIATES Nole5 to Consolidntcd Financinl Statements (I 0) Fair Value Measurement and Fair Value of Financial Instruments Fnir value is the price that would be received for an asset or paid to transfer a liability in an orderly trnnsnction between llUlrket p:u1icipants on tire mcnsurcment date. The fair value hierarchy requires an entity to m:r>imile the usc of observable inputs and minimize the use of unobservable inputs when measuring fair value. The fair value hicrorchy describes three levels ofinputs thnt may be used to measure f.1irvnluc: Levell: Quoted prices {unadjusted) for identical assets or liabilities in active markets thnt the entity has the nbility to access 3S oft he me>"lsuremcnt date.

Level 2: SignifkMlt other observable inputs other than Levell prices, such as quoted prices for similnr assets or liabilities, quoted prices inllUlrkets that are not active and other inputs that nrc observable or can be corroborated by observable m.1rket dMa.

Level 3: Significant unobservable inputs that renect a company's own assumptions about the assumptions that market participants would use in pricing. an.asset or liability.

The C'omnrmv lias loans that nre transferred to repossessed assets nnd are rneusured at fair value on a nonrecurring basis; that is, the Instruments nrc not ~mnsured nt fair value on an ongoing b:~!is but are subject to fair value adJustments in certain circumstances (for e:\llmple, when there is evidence ofimpainnent).

The following table presents the repossessed asset~ value carried on the consolidated balance sheets by level within the fair value hier:rrchy (t~s described above) for which a nonrecurring. change in fnir vnlue has been recorded: Atli\1l ;\brltt:IS For Identical Observable Unoll$ttv:&bt.e Auets Inputs Inputs in thou$:&nd' Tot~\ (Len! I! (Lil''lli2J (le\'1."!1 J] Tot:~\ Lossu Repossessed t~ssets Qccemhcr:; I 20! 2 s 6,355 s s s 6,355 s 3,803 Repossessed assets s 4,785 s s s 4,785 s 1,755 The fair value of repossessed assets was detennined based on comparable recent used vehicle sales and krrol\11 changes in the broad used vebr'de m.1rket.

The C'omnauv's fin~ncia\ instruments consist priman1y oft:ash and cash equivalents, restricted cash, title loans receivable (net), u note receivable from the Sole Shareholder, the Revolving Credit Facility, the Notes anti other notes payable. For aU SitCh instruments, other than the Notes, the canying amounts in the consolidated financial statements appro1.i.mate their fair values.

The fair values of cash and cash equivalents are measured using levd 1 inputs. Title loans receivable are originated at prevailing m.11ket rates. Given the short·tennnature ofthese loans, they are continually repriced at current market rntes. Tire fuir values oftitlc loans receivable are measured usingleve13 inputs. Tire fair vnlues oft he Revolving Credit Facility and notes payable and receivable arc estimated using level 2 inputs based on rates cumntly availnble for debt with simila.rtenru and remaining maturities. Tire fair value oft he Notes is estimated using leve\2 inputs based on the market yield on trades ofthe Notes at the end ofench reporting period. The fair value ofthc Notes was S390.8 million and $360.6 million as ofl)•cemher :11 2012 and .:illl.L respectively.

0675 Tahle ofCon!ents Tl\1X FINAJ~CELLC AND AFFILIATES Notes to Consolid.1ted Finnndnl Statements (11) FmJioyee Benefit Plans !ncentive 1\:!Vinr~ Pl~n

The Comnnnv has a 40l(k) Employl.'CS' Incentive &!vings Phmthlll covers all employees who have completed sixmonths of service. The romn:mv's match ofe!T'Jiloyee contnbutions is discretionary and detennined annually. Beginning !:mann• I 2QQ9, !he Comnrmv initiated a new matching progrum whereby eligible employees' contributions are matched 50% by the rommmv up to 6% of the employees' earnings. The cost ofsuch contributions totaled appro)jmately Sl.O million, SO.S million and SO.S million for the years ended Pecemhs:r ~I 2!ll.2, 2!ll.l and 2.!llQ, respectively.

He.1!tb ln~pmnce Phm Effective Deccmh¢r 1 2(H 1, Jltc: romnanv ;~doptcd a self·insurcd health plan available to aU full· time salaried employees after sixmontlts of service. 'The romn:tnv has stop-loss insumnce coverage for individual and aggregate claim levels. The total e:q:~ens~s related to this plan arc included in salaries and related e~emes on the consolidated statements of income and were appro:-imntely S3.3miUion and 50.3 million forthe yenrs ended December~ 1 ?Qp and 2Ql!, respectively. Priorto Dcccmbcr2011, the C'nmmuw offered reimbursements for health premium costs incurred by employees in obt:~ining outside medical coverage. The amounts reimbursnble varied between employees nod were detcmrined by position or through negotintions between the C'onmnnv and the employees, • (12) Rclnfcd Pnrt)" Trnnsactions llte Cornnmw leases the corporate office from PYa11d various retail spaces from TYI and ecnain employees. Rental payments poid to these entities foroperatin~; leases amounted to appro)jmately SO.S miUion for the year ended Decemher ~ 1 2012 and SO.S million for each oft he years ended Decemhc1· ~~ 201 t and 2010, The Conmnrt\' also !eased cenain retail sp:~ces under capital lease agreements fromcenain employees with total payments af$38,000 for the year ended December ~I 2012 and SO.l million fore:~ch of the years ended Decemhcr 31 2011 and 2Q.!!!. As ofDeeemher ~1 2012, the romnmw did not have :my capital !ense agreements wil11 related panics.

Interest e"J)ense on notes payabh: to related panics totaled S!.3 million, $2.2 million and S0.9 million for the years ended December :I I 2012, 20! 1and 2010, rc~pcctively. Interest income on the note receivable from Sole Shareholder was appro)jmme!y $0.2 million for each ofthe years ended Decc!llhcr ~1 ">OJ? and l!ll!,nnd $20,000 for the year ended !?eq:mllo;r 31 2010. (13) Commitments Orerntjng I case Cnmmjum:ms The rommmv leases retail space: under non~eaneelab!c agreements that require various minimum annual rent payments plus the payment ofpropeny Ia:res und illsur.mce. In addition, the C'nmnnny leases certain equipm:nt under non-eancel~ble operating lease agreements, wl1ich require set rent payments <1nd payments ofpropeny taxes. Future nlinimumrcnlal commitments under all non-cancelable operating leases whh tenns of one year or more :tre due in calendaryears ending December 31 as foUows: (iu lhouund5) Rclnlcd Vear fnding D~t~mb~r lt. rarl\' Other Total 2013 s 638 s 45,695 s 46,333 2014 552 41,310 41,862 2015 362 35,677 36,039 2016 339 27,402 27,741 2017 227 17,579 17,806 Thereafter 311 36,906 37,217 Total obligations under opcrnting leases s 2,429 s 204,569 s 206,998 ll1e total rent e:-.pensc was appro~im:nely $<10.0 million, $29.6 million and $22.2 million, respectively, for the years ended 11cccmhcr :>I ">01 ?, 1Q.!l and 2010. Rent e:.pense is recorded on o strnight·Hne basis over the life ofthe lease.

T:~h1c nfCnntcnJ~

Tl\JX F1NANCE LLC ,\I\'UAFFlLIATES Notes to ConsoliiJ.1!ed Fin:mci:~l Sta.lements (13) Commitments (continued) C.1pjtal Len~e C.ommiJUleDt~ The ronmanv Ieoses seveml retail spaces under capita! lease agreements with terms of 15 years. Future mininmm lease payments under capita\lellses, together with the present value ofthe: net minimum lease payments as ofTJec.;omher:; I 10!2, are due in cnlendnryears ending December 31 ns foUows: (in lhouunds) Year En din Deccmhor ll, Total 2013 s 261 2014 267

0676 2015 272 2016 277 2017 283 Thereafter 1,745 Subtotal 3,105 Less: amount representing interest (1,134) Total obligations under capital leases s 1,971 (14) Contingenci~s

The C'omn:mv is involved bt various legal proceedings. These proceedings are, b1the opinion ofm.1nagemem, ordinary routine mailers incidental to the normal business conducted by the C'ompmw. Legal proceedings brought against the C'onm:mv include, but <~.re not limited to, allegations of violations of state or fcdcml consumer protections, disputes regarding repossessions, and employment related mauen. For e)l3mple, TitleMaxofMissouri, Inc. is a party to a putath•e class action law~uit aUeging that the entity failed to pay certain employees overtime compensation as required by Missouri law. In the opinion of management, an appropriate accmal has been established related to the above referenced legal matters. Outcomes ofsuch proceedings are not e:qlected to have a mnteria\ adverse effect on the C'ommmv's consolidated financial position, results of operations or cnsh flows. (I 5) Ph:mtom Stock Pl:tn The Cnmpnnv has a Phantom Stock Plan which authorizes the gtilnt oflong•tenn incentive awards in the forn1 of phantom stock units, or "PSUs" or phantom stock apprcci~tion rights, or "PSAR.~. "The phantom unit awards do not constitute ownership of any membership or other equity interests of the Conmrmv or any ofits suh~itlimic~ nor do they give the holder any votb1g rights. PSUs entitle the holder to receive a cash payment equal to the fair value oft he underlying shares of stock in TMX Credit, Inc., subject to certain resuictions and to risk offorfeiiUre. The PSARs em ide the holder to receive a cash amount determined by the appreciation in the fair value oft11e underlying: shares of stock in TMX Credit, Inc. betwee11 the grant date of the shares and the date ofexercise. The fuirvnluc ofthc phantom shares is equal to three times the earnings before interest, ta>l:s, depreciation and amonilation ("EBITDA ") ofTMX Credit, Inc. for the 12 months precedbtg: any \'!l!uation date, as computed by the Compnnv. The value ofthe PSUs and PSARs is zero at Dccember:ll 2\H2and 2011.

A fonnerofficer oft he Conmnnv had an employm.!nt agreement which in~ludcd a phnntom sto~k award that became payable on Decernh«r 31 :201 I The incremental increases b1 the reponed \'alue of this award of SO. I million and $5.7 nlillion are included in salaries and related e~enses in the consolidated statements of income fort he years ended Decemher 3 I 2ill.l and 2!llil. respectively. The total cal~ulated value of$9,8 million is included in accounts payable and a~crued e~enses in the eonso!id:~ted balance sheets at December~~ 201 I The phantom stock award was paid during 2012.

TahleofC'(!ntenr~

TJ\IX FINANCE ll.(.'

AND ArFILlo\TfS Notes lo Consolidated Finnnci:tl Statements (unautlited) (16) Chapter 11 B:mkruptcy Filing On Anri! "0. ?fl09, the Cnnmanv filed voluntary petitions under Chapter II ofthe United States Bankruptcy Code in the U.S. Bankruptcy Court in the Southem District ofGeorgia. The filing o~curred due to Jhe innbiliry to rea~h :~n agreement to e~end a tem1 loan ngrcement or to obtDin replacement fmancing with a new lender. During the pendency ofthe bankrup!cy proceedings, tilt! C'ompmw continued to profitably operate its business. The Compnnv e:>.itcd bnnkruptcy protection on Anril P ?Q!Q. AU princip;ll and interest payments ordered by the Bankruptcy Court were made on time and in full, and no creditors were impaired ns n result of the proceedings. (17) Guarantor Condensed ConsolilL1ting Fimmci:1\ Stntements The payment of principal and interest on the Notes is guaranteed by the wholly-own~d suh;;idi:Jrie~ ofthe Issuers other than inunaterial suh~idinri!!S (the "Srrb.~ldlary Guurantors").

It is not guaranteed by Construction, Avintion or the Cnmpnnv's consolidated CSO Lenders tthe "Non-Guara/1/ar.\'ub.l·ldlm'Js•.,·"). Thesepamte fmancialstatc~nts ofthe Subsidiary Guarantors are not included her~bl because the Subsidiary Guarantors are th(~ C'oUinnnv's whoUy-oWiled cot~so!idated ~t1hsidinries and are jointly, scveraUy, fully and unconditionaUy liable for the obligations represented by the Notes. The C'ommmv bdieves that the consolidatbJg fm;mci~l infomJ.'Ition for the Jssuers,the combined Subsidiary Guarantors and the combined Non-Guarantor Suh~irlinrie~ providi! infonnation thoc is mote meaningful in understanding the financial position ofthc Subsidiat)' OJarantors than separate financial statements ofthe Subsidi31)' GuarantoiS.

The following consolidating linan~ial statements present consolidating financial data for the Issuers, the combined Subsidi:~ry Guarantors, the combined Non-Guarantor Snh.~idinrie.~ and an elimination column for adjustments to arrive at the infonnation for rhe C'mnmmy on a consolidated basis as ofD~:ccmh~:r ~I ?012 and 1!ll! and for each ofthe years in the three ycnr period ended Dsccn~1er .'\I 'lOJ "·Investments in ~uh::jrtj;m·cs arc a~counted for by the C'ompnnv using the equity mcthnd fur purposes of this presentation. Rc$ults of operations of~ph::isHrri!)~ are therefore reflected in the parent comp:my's investment a~counts and eamings. The principal elimination entries set fonh below eliminnte investments in '"Jh~ic!imies !lnd intercompany balances and transactions.

Table o[C'ont<!ms TMX FINAN'CELLC AND AFFILIATES Notes to ConsolitL1tcd Financial Statement~ (17) Guarantor Condensed Consolitlaling Financi:ll Statements (continued) Consnlitbting B:ll:tnce Sheet Drcrml~r 31 2012 (in tilnusunds}

lssuer1 Gu~r~ntors Eliminntigns Consalidnlcl.l

0677 Assets Cash and cash cqttivalcnts s s S8,80J s 1,993 s s 90,794 Title loans receivnble 542,771 34,401 577,172 Allowance for loan losses (88,986) {5,575) (94,561) Unumonized Joan origination costs 3,716 3,716 Title loans receivable, net 457,50] 34,401 {5,575) 486,327 Interest receivable 37,893 162 38,055 Properly and cquipllX!nt, net 75,474 \9,765 95,239 Debt issuance costs, net ofaccumubted arnonization 10,570 10,570 Goodwill 5,975 5,975 Note receivable from Sole Shareholder 1,017 \,077 Other assets 29 48,841 !,9% (11,120) 39,746 lnvesurent in affiliates 729,325 t729,325) Total Assets s 741,001 s 714,485 s 58,317 s t746,020) s 767,783 linbilities and Equity Senior secu~d notes, net s 311,5\9 s s s s 311,519 Revolving credit facility 25,000 25,000 Notes payable 12,000 25,336 37,336 Notes payable to related panics 19,628 19,628 Obligations under capital leases 1,971 1,971 Accounts payable and accrued e:q:~enses 19,5-H 46,540 11,970 (16,716) 61,341 Total Liabilities 368,066 48,51 I 56,934 (16.716) 456,795 Total member's equity and non controlling interests 372,935 665,974 1,383 {129,304) 310.988 Total Uabilities and Equity $ 741,001 s 714,485 s 58,317 s (746,020) s 767,783

T:~hle of('oulents ThJX FIJ'IIANCE LLC AND AFFJLJATES Notes to Consoli!l:tled Financial St:llements (17) Guarantor Condensctl Consolitl:lting Financi:Jl Statements {continued) Consolida.ting Balance Sheet Decenl\)('r 31,2011 (in thous:md.'>) Nnn• lssuen Gutlr~nl~rs Guarnnlors fJimin11tions Consolldt~tcd Assets Cash and cash equivalents s s 37,220 s 921 s s 38,141 Title loans receivable 475,263 14,830 490,093 Allowance for loan losses (70,955) (2,148) (73,103) Unamonizcd loan origination costs 2,829 2.829 Title lmms receivable, net 407,137 14,830 {2,148) 419,819 Interest receivable 31,'152 65 31,517 Propeny and equipment, net 51,437 21,134 72,571 Debt issu:mce co~t~. net of accumulated amortization 14,042 14.042 GoodwiU 5,975 5,975 Intangible <~ssets, net 140 140 Note receivable from Sole Shareholder 1,549 1,549 Other assets lO 37,863 1,374 (18,273) 20,994 Investment in affiliates 541,614 (541,614) Total Assets s 557,215 s 571,244 s 38,324 s (562,035) s 604,748 llatjlities and Equity Senior secured notes, net s s s s 312,120 Notes paynble 312,120 J1,370 ' 11,370 Notes payable to related potties 20,512 20,512 Obligations under capital leases 2,052 2,052 Accounts pilyableand iltcrued e){lenses 18,940 44,581 5,698 (6,864) 62.356 Total Liabilities 331,060 46,634 37,580 (6,864) 408.410 To!al member's equity and noncontrolling interests 226,155 524,610 7>14 (555,171) J%,338

0678 Total UabiUties 6nd Equil)' s 557,215 s 571,244 s 38,324 s (562,035) ;'--.....::'";.;·:.;7':::'

Tt~hle nfCnntent~

Tl\IX FINANCELLC ANDAFAUAn".S Notes to Coruolitbted Fin:mcinl Stlltements (17} Guarantor ContknscdConsolidaling Finnncinl Statements (continued) Consnlidnling Sbtemenl of Income Year fntkd December 31 2011 (In thousands) Non· !JSUU:.'I Gu~nntors Gu~r~nton Ellminntlons Conso!id~!td Interest and fee income s s 652,205 s 4,550 s s 656,755 Provision forlmm losses (144,749) (144,749) Airt:rof\ service revenue 3,745 (3,745) Net hucrest and fee income and aircraft service revenue 507,456 8,295 (3,745) 512,006 Costs, expenses and other: Salaries and related e~enses 201,881 18 201,899 Occupancy costs 64,336 391 64,727 Other operating and administrative e;>;penscs 316 116,042 4,293 (3,745) 116,906 Interest, including amortization ofdcbt issuance costs 46,273 (554} 3,574 49,293 Total e;>;penses 46,589 381,705 8,276 (3,745) 432,825 Net (loss) income before equity in income of affiliates (46,589) 125,751 19 79,181 Equity in income from affiliates 125,751 l115,751) Net income (loss) s 79,162 $ 125,751 s 19 $ (125,751) s 79,181

1'able off'nnlcnts Tl\'IX FL'IANCELLC AND AFFiLIATES Notes to Consolid:lted Fimmd:li Statements (17) Guarantor Condensed Consolitbting Fin:ancinl Statements (continued) Consolidating Statement of Income Year Ended Oeccnthcl"31, 2011 (in thousands) Non· luu~rs Gunrnntors Gunr:mtors Diminatioou Com~lid3!ed Interest ond fcc income s s 504,965 s \100 s s 505,865 PrO\·ision for!oan losses (99,542) (99.542) Aircraft service revenue 3,840 (3,840) Net interest and fee income and aircraft service revenue 405,423 4,740 (3,&40) 406,323 Co~ IS, cx~nses and other: Salaries ond related e:q~enses 159,017 184 159,201 Occupancy costs 48,236 320 48,556 Other tlpemtins and administrative e;>;penses 337 88,096 3,428 (3,840) 88,021 Interest, including amortization of debt issu:mce costs 40,212 (37) 2,435 42,610 Total c:q~enses 40,549 295,312 6,367 (3,&40) 338,388 Net (loss) income before equity in income of affiliates (40,549) 110,111 (1,627) 67,935 Equity in income from affiliates 110,111 (110,111) Net income (Joss) s 69,562 s I 10,111 s {1,627) s (l!O,lll) s 67,935

0679 Tahh• n f('nntt:!l!S TMX FINAJ'l'CE lLC AND AFFILIATES Notes to Consolidtlt~d FinMcinl Stntemmts (17) Guarantor Contlensed Consolitbting Financial Statements (continued) Coosolid:lting Statement of Income Year En tied Os:ccmher 31. 20 I 0 (in thousands) Non- ls~u~rs Guar.ln!ort Gu:.nntors Eliminations Con,olid:~tod Interest and fee income s s 389,449 s s s 389,449 Provision for lonn losses (63,932) (63,932) Aircraft service revenue 1,493 {1,493) Net interest and fee income and aircraft service revenue 325,517 1,493 (1,49)) 325,517 Costs, Clpcnses :md other: Salaries and relnted e;.;penses 115,821 269 116,090 Occupancy costs 34,793 146 34,939 Other opcmting and ndministrntive expenses 61,038 1,458 (1,493) 62.003 Interest, indudiny nrnor1iz.ation of debt issuance costs 25,771 (46) 526 16.251 Toto! eXpenses 25,771 211,606 ))99 (1,493) 239,283 (Loss) in com<: from continuing opt:r.ttions ht:fort: reorgauir.~tion itt:ms (25,771) 113,911 (1.906) S6,234 Reorganization items: Professional fees 4,548 4,548 Net (loss) income before equity in income ofaffili;ues (25,771) 109,363 (1,906) 81.686 Equity in income from affiliates 109,363 (109,363) Net incomc(loss) s 83,592 s 109,363 s (1,906) s (109,363) s 81,686

Tnble ofContcnt~ T!\lX FINANCELLC AND AFFlUATES Notes to Consolltlate:d Financial State:ments (17) Gu:mmtor Conde:nse:d Consolitfating Fin:mcial State:ments (continuedj Consolidating Statement of Cash FlO\IS Year Ended O£csmi"Sr 31 2012 (in thousnntll) Non- lssuen GuJir:mlor.l Gn:~rnntors Consolltl~t~tl Net cash (used in) fX"Oiidcd by operating acthilics s (•12,519) s 157,899 s 222,321 Cash Flo\l:s from In resting Acti\ities Net title loans originated (190,799) (19,571) (2\0,370) Purchase ofproperty and equipment (41,128) (41,128) Proceeds fromdisposalofpropeny and equipment 823 823 Increase in restricted cash {4,325) (4,325) Receipt ofpuyments on note receivable from Sole Shareholder 472 472 Net activity with affiliates 5,658 (7,528) 1,870 Net cash provided by (used in) investing activities 6,130 (242,957) (17,701) (254,528) Cash FlDIIS from Financing Acti,itics Proceeds from rcvol\'ing. credit facility 25,000 25,000 Proceeds from notes payable 12,000 15,683 27,683 Proceeds trom<:ontributions 58,750 58,750 Repuyments of notes pnyable and cupitalleases (80) (2,601) (2,681) Payments or debt issuance costs (611) (611) Distributions {22,031) (1,250) (13,821) Net cash provided by finnncing activities 36,389 36,639 11,832 84,860 Net increase in cash nnd cash equivalents 5!,581 1,072 52,653 Cash and cnsh equivalents at beginning of period 37,220 921 38,141

0680 Cash nnd cash equivalents at end of period s s 88,801 s 1,993 s 90,794

Tnhlc of Content~ T[I.JX. FlNANCELLC AND AFFILlATES Notes to Consolid::atcd Finnnci:ll Stalemenls (17) Gunr:mtor Condensed Consolit.1.1fing: Finnncinl Slntcmcnts (continued) ConsolitL1ting St:~temcnt ofCllSh FlO\IS Yenr Ended n~ts:mt3:r 31 2011 (in thousnnds) Non· bsuen: Cu:tr:l.l'ltOr$ G11llr:mlon Consolidated Net <:llSh (uscdjn) pro1idetl by operating acthitics s (35,454) s 206,652 $ 3,%1 s 175,159 Cash F1o11S from ln\l:Sting Acthilies Net Iitle loans originated (190,537) (14,561) {205,098) Paymems for<~cquisitions, net ofcilsh :~cquired (8,032) (8,032) Pun:haseofproperty and equipment (31,930) (479) (32,409) Proceeds from disposal of property and equipment 399 399 Increase in restricted casl1 (3,525) (3,525) Receipt of payments on note receivable from Sole Shareholder 418 418 Cash from consolidation ofvariablc interest emitics 1,794 1,794 Net activity with affiliates (24,838) 23,380 1,458 Net cash used in investing activities (24,420) (210,245) (11,788) (246,453) Cash Flu11S rrom Fln~ndng Aclhifics Proceeds from senior notes 6:1,200 64,200 Repayments ofnotes payable and capital leases {2,035) (68) (12,408) (14,511) Proceeds from notes payable 21,080 21,080 Payments of debt issuance costs (2,291) (2,291) Proceeds from contributions to consolidated variable interest entities 76 76 Distributions (12,704) (12,704) Net cash provided by (used in) financing activities 59,874 (12,772) 8,748 55,850 Net (decrense) increase in cosh and cnsh equivah::nts (16,365) 921 (15,444) Cash and cash equivalents at beginning of period 53,585 53,585 Ca5h and cash equivalents at end of period s s 37,220 s 921 s 38,141

TahleofC'ontent~

TJ\.l.X FlNAI"'ICE LLC AND AFFILIATES Notes to Consolitbtcd Financial Statements (17) Guarantor Contknscd Consolidating Fin:mcilll Statements (continued) Consolitlating Statement of Cash Ro11s Year Ended n:cs;mhcr 31, 201 o (in tbous:mtls) Non· lsmers Guarani on Gunran!ars Consaltd:~.!ed Net ~ash (used in) JrOiitkd by operating n~ti\ilics s (6,320) s 183,578 s (1,047) s 176,211 Cash Flo\ls from lm'CSting Actilifics Net title loans originated (129,572) {129,572) Payments for acquisitions (400) (400) Purchnsc ofpropcny and equipment (18,700) (13} (18,713) Proceeds from disposal of property and equipment 112 112 Decrease in restrict~d c:~sh 846 846 Proceeds from safe ofaircmfl held for sate, net of selling c~enses 12,700 12,700 Purchase of aircraft (17,657) (17,657) Issuance ofnotc receivable to Sole Sharcholdcr (2,000) (2,000) Receipt ofpnymcnts on note receivable from Sole Shareholder 33 33 Net nctiviry with nffiliates (65,275) 61,685 3,590

0681 Net cash used in investing activities (67,242) (86,029) (1,380) (154,65!)

Cash Aows from FinQncing Aethitie:s Payments on term loan (151,000) (151,000) Proceeds from senior notes 247,695 247,695 Proceeds from contnbutions 3,146 420 3,566 Repayments ofnotes payable and capital leases {5,938) (58) (14,413) (20,409) Proceeds from notes payable 17,750 !7,750 Payments of debt issuance costs (17,195) (17,195) Distnbutions {74,0{i0) {1,330) (75,390) Net cash provided by {used in) financing activities 73,562 (70,972) 2,427 5,017 Net increase in caSh and cash equivalents 26,577 26,577 Cash and cash equivalents at beginning of period 27,008 27,(108 Cash nnd cash equivalents at end of period s s 53,585 s s 53,585 .60

T~hlc ofC'on!Cn!s ITEM 9. CHAi'~GES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None.

ITE:.\19A. CONTROLS AA'D PROCEDURES, Disdusurr:: Cuntruls ami Procedures TI!C Commmv m.1intnin.s di5clo.sure controls and procedure$, as defined in Rule 15d-l:5(c) under the Securities E.\:Change Act of 1934, ns am:ndcd, or the "Exclumge Ar:f," tho! <Ire designed to ensure that inform1tion required to be disclosed in ourreports underthe E.~hange Act is recorded, processed, summariud and reported within the time periods specified in the SEC'5 rules and fonns nnd th;~t such informEition is accumu/3ted and comnunicntcd to our management, including our ChiefE'l:culive Officer and Chief Accounting Officer, as appropriate, to allow timely decisions regarding required disclosure, The C'pmpnny's m.1nasement carried out an evaluation, under the supervision and with the participation of our 01iefE~eutivc Officer and 01ief Accounting Officer. ofthc effectiveness ofourdisclosurc controls and procedures as ofDccenlher 31 2012. Based on the evaluation, ourOJiefEv.ecutive Officer and Chief Accounting Officer have concluded that 1he Cmnpmw's disclosure controls and procedures were effective as ofDecemher 31 2012.

Management's Report on Inlcrn~l Control O\er Financial Rcp::~rting

The Cornnmw's management is responsible for establishing and maintaining adequate intemal control over financial reponing as defined in Rule 13a·l5(f} under the E..:.change Act.

Mnnagcmcnt conducted an evaluation of the effectiveness of our internal control over financial reporting based on the criteria established in /llll'rlla{ Control-Integrated Framework issued by the Comrni11ee of Sponsoring Organi;>;ttions oflhe Treadway Commission. Based on this evaluation, nunagement concluded that our internal control over fimmcia1 reponing was efiCctiveas ofDcccmher:>t "lOP.

Chnnges in Internal Control Q,u Financial Reporting There were no changes in !he C'nnmnnv's internal con1rol over financial reporting, as defmed in Rule 15d-15(t) under the E.:.cl1ange Act, during the year ended f)gccmhcr 31 2012that materially affected, or are reasonably likely to materially affect, 1he Conmnnv's intcmal control over fmanci~l reponing.

ITEM9B. OTHER INFORMATION.

None.

T~hlc off'onlenrs PARTW ITEM 10. DffiECTORS, EXECUfJVEOFFICERS AND CORPORATE GOVERNANCE Set forth below are the names and ages of, and the positions held by oure1a!cuth•e officers <1nd by ot1r numagers (which are similar to directors, subject to certain limitations contained in T~·IX Finance LLC's operating :'lgrecmcnt). B;ecutivc officers serve at the pleasure ofTmcv Ynmw, who is our 01ainnnn oflhe Board, ChiefE'Il:cutivc OffiCer and President, subject to the tenns of<~ny applicable employment agreement. Pursuant to TMX Finance LLC's amended and restated opernling agreement, managers serve untilthdrdcath,perm<'lnent disability, rcsignn~ion or removal by Mr. Young.

N:~m~ Pod!lon " 0

Trncv Young 55 Cbainmn ofthc Board, 01iefE~cutive Officer nnd President FliiT!hc!h C. Nelson 47 Cbicf Accounting Officer Olio W. Bielss, Ill 50 Senior Vice President of Operations Douglas W. Mnrohn 40 Sen,ior Vice Pres idem of Operations ArthurTretynk 34 Senior Vice President of Operations Rohe11 F. Pirkle, Sr. 58 Manager

0682 John 0 KmJncclv 111 5I Manager Mr. Young founded onrConm~nv in 1998and has since served as ChiefE.\l!cutive Officer. He was appointed as the Ccmmnnv's President on b=·larch .,., 20Ll Prior to foundingmu Comonnv, Mr. Young owned and operated Patriot Loan Co., a consumer installment lending company with locations in four states. Mr. Young has been a manngerordirec!orofl.b.t Comonnv or its predecessor since 1998. Mr. Young's current position os our C11ief~cutiYC! Officer and President combined with his past manage~mnt experience in the consumer lending businC!SS provide him with leadership skills and a practic:al and infonned perspective on matters related 10 the Conmnny's business and industry.

FJi7i1helh C'. Nelwn was appointed as the Conmanv's Chief Accounting Officer in AuguSl2012. Ms. Nelson joi11ed rhe Cmnnnnv as Corporate Controllerin December 2009. She was promoted to Vice President ofFinancial Operations in Decernber2011 and served in this capacity until her nppointment as Otief Accounting Officer. Prior to joining the ('ommmv, Ms. Nelson held vnrious positions in financial ma.nagemenl with CentexCorporntion, a construction and real estate company. Ms. Nelson started with CentexCorporation in 2002and served as a Division Controller from 2006 to 2009.

Otto W. Bielss, Ill joined us in January 2010 as Senior Vice Presidem ufOperations ofTMX Finance LLC and serves in such cap~city for our other companies as weU. Prior to joining us, Mr. Bielu spent nine years with Ace Cash E-.:press as a Di\·ision Vice President. Prior to Ace Cash E\press, Mr. Bielss held various management positions with Blockbuster Inc., Micltaels Stores, Inc., RadioShack Corporation and Eagle Sound Production, a privately-owned sound production company in Irving, Tc;>.as. Mr. Bielss brings over29years ofmanagement e;..perience to the Compmw.

Douglas W. Marohn joined us in August 201 1and is currently serving as a Senior Vice President ofOpemtions. r-.tr. Marohn oversees our EAL and rNL brnnds. Prior to joining~ ~.Mr. Marohn served as Se11ior Vice President ofOpemtions at Nicholas Financial, Inc., where he held various management positions from Aprill998through July 201 I.

Mr. Marohn has eJJensivc e~eriencc in opern1ional manngcrnent and developl'lr.nt in the consumer lending indusuy.

ArthurTretyakjoined us in May 2011 ns n Senior Vice President of Operations. Priorto joining the Conm~nv Mr. Tretyak spent three years ns a Vice President with En ova Financial, the e·conuncrce division ofCash America International. Prior to Enovn Financial, Mr. Tretyakserved two years as 11 consultant with l'l'lcKinsey & Company. Mr. Trclyak's spednlired knowledge and experience in online lending enable him to provide valtmble leadership to the C'omnn1w as it develops its online title lendin~; business.

Honorable Rnh.:11 F. Pirkle, Sr. wns elected a nmnagerofTMX Finance LLC in Dccember20ll. Judge Pirkle has been a judge and in the priVilte practice oflaw since 19&4. Throughout the past !Oyears, Judge Pirkle has and continues to serve as ChiefJudge in three Municipal Couns in ~orgia, as weD as an AssodateJudge forthe State Coun and Judge Pro Tempore for the Juvenile Court Prior to holding these positions, Judge Pirkle was the elected Solicitor G:neral for Long County, Georgia for 12 years. Judge Pirkle holds a BachelorofBusiness Administrntion from the Terry School of Business oft he University ofGcorgia, a Masters Degree from

Tnhle ofComen!!; Georgia Southern University and a Juris Doctor L"lw Degree from Samford University. Hc hns c:\lcnsive training and e:q.tcrience in nil Fed em\ and State Courts. His knowledge in the different areas oflaw enables ltim to provide guidance and insight to the Cnmnnny and the Board of Managers in matters related 10 business nnd government.

lohn G. Kennerlv Ill previously scrvcd as a rnanagerofTI'viX Finnnce LLC from June 2010through December 2011 and was again elected a nunagerofTMXFimmce LLCin Dcccmbcr2012. Mr. Kennedy serves as Managing Director and Head ofCapital Markets at Tudor, Pickering, Holt &Co. Securities, Inc., where he hns been employed since January 20!0.

Mr. Kennedy hos more th:~n 25 years ofexperience in investment banking. Mr. Kennedy served as a Managing Director ofDeucsche Bank's investment banking group :md served as a Mannging Director ofDonaldson, Lufkin & Jcnnrette until its sale to Credit Suisse First Boston. Mr. Kennedy setves on the Board ofDirectors ofRoadrunner Transportation Systems Inc. Mr. Kennedy has served or currently serves as trustee or director of various private companies, foundations nod not~for-profit institutions. Mr. Kennedy earned a BachelorofSciencc, cum laude, from Washington and Lee University P.nd a Mnsters in Business Administration from the Amos TuckSchoolofBusiness at Dartmouth College. Mr. Kennedy hils spent much of his career in the investment banking industry and has signifieartt finance experience, which allows h,im to contribute a valuP.ble and informed perspective on business and finance-related matters. Additionally, Mr. Kennedy's e:q.teriences as p. trustee ordirectorofother entities have e:qJosed him to a wide amy ofbest prnctices, which enable him to provide unique insig\11 and guidance.

Two of our three managers, Messrs. Pirkle and Kennedy, arc independent m:~nagers {with independence being determined in accordance with the New York Stock E\:Change's definition ofindcpe11dence, as ifit applied 10 us), menning that they do not have, and have never had, any material transactions, relationships, or arr.mgcments with us, either directly or as a shareholder, pnrtncr or officer of another orgnnizationthat hns or had a relationship with us.

The C'nmpanv's managers ha\•e no! created an audit, compensation or nominating committee and do not ha\•e any other committee performing such functions. Tracv Ynmw, our Chainnan ofthe Board, OJiefE'l!cutive Officer nnd President, perfofm!d the function ofa compensation conuninee during the fiscal year ended Qceemhe1·; 1 "012; however, no m.1nagcrs acted as n nominating commillee or on audit convnittee during 2012. The managers believe thatl\·Jr. Young is most properly suited to consider and decide Ill.'ltters typicaUy falling witl1in the authority of a compensation and a nominating committee.

Additionally, we have adopted a Code of Conduct and Ethics that is ~ppliciible to allofouremployces, including ourC11iefE~cutive Officer, Chief Accounting Officcnmd Coipor.~te Controller. The CodcofConduet nnd Shies is fiOStcd on ourwchsilc at WI\"W.Iitlem1xhj7. We intend to satisfy the disclosure requirement regarding any amendment to, or waiver of, a provision of! he Code ofConduet anti Ethics for our ChiefExecutive Officer or Olief Accounting Offker by posting such information on our wchsitc, The C'ompanv 's operating agreement ploces sl"gnific1mt linu"tations on the authority, role and responstbilities oflhe manilb'Crs other than Mr. Young, os the sole bcncficinl omter of our pan:nt compa11y, nnd subjects them to the authority ofMr. Young in many respects. For e~mple, the opemting agreement provides thotthc executive officers serve at the pleasure of Mr. Young rathenhan the managers and restricts the ability ofthe Ill.'lnagcrs to, among other things, amend TMX Finnncc LLC's operating agreement nnd require additional capital contributions from Mr. Young.

Manager Compensntion A manager who is also one ofour employees does not receive any additional compensation for his services as a manager. Each non·ex.ecutive m::mager is paid for his services and does not receive any sepilrate tooeting fees, equity awards orincentive compensation. In addition, non·eJ.:Ccutive m:mogers are reimbursed for any reasonable out ofpocl:et e:qJenses incurred in connection with rendering their service :'IS managers. The following table describes the compensation cnmed by non·e1'CCUiive managers during 2012: 2012 l\funager Compen$lllion Fees Enrnetl or rnitl in All Other Name C:uh Comnensation TaT~\

Rohcn F. Pjrkl.: Sr. 100,000 100,000 John W. Robinson, U\ 200,000 200,000 Effective 0-:cl!mhcr ~I 201 ::!, our parent company approved n change to our Board ofManagers. The three managers are Messrs. Young, Pirkle, and Kennedy.

0683

Toh!c of Contents IT~111, EXECUfiVECOI\-IPENSATION.

Compensation Discussion undAn3lysis General This COJ111tnsation discussion and analysis provides an overview of our compensation program :md policies, the material compensation decisions we have w.ade with respect to !hs ~·stop c~cutive officers and the material factors that we considered in making !hose decisions.111e tables and disclosures foUowing this compensation discussion and analysis contain specific dattl about the compensation earned in 2012,2011 and 20\0, tiS npplicable, by the following individuals, whom we referto as our named e~cutive officers: Imcv '(tmng, our 01iefE-.:ecutive Officer 1111d President (a), Bi7nheth (' Nel~on our01ief Accounting Officer, Quo W. Bielss, Ill, a Senior Vice President ofOperations, Douglas W. t'o.·larohn, a Senior Vice President ofOpernrions, and ArlhurTretyak, a Senior Vice President ofOperutions.

(a) Effective Mnrsh 12 2flt:l, Mr. Young's title 1\'as clLonsed to Chief~cutive Officer and Presidenl.

In addition, this discussion addresses the compensation provided to our fo!ll1f!r OliefFinancial Officer, Donald E. Thomas, whose employment with the Comnany ended on Ani:USt 21 "0!2 We hired two individual~ who were expected to take the role ofPrcsident in 2012, but each separated from the ComNnv in 2012 prior to completing their field training progrnms or assuming the full duties oft he President role. This discussion docs not address the compensution ofthese fonncrcmployccs.

Our compensation progmms are intended to attfilct and retain vital employees and to incentivi?J:: high level talent to work for and uhimatcly ndd value to our business. Our compensation stntctur~: is ~lative!y simple, combining base salaries with a mix of cash-based bonuses and incentive awartls, perquisites and severance protection. We do not h11ve a formal Compensation Conulittee. AU decisions related to compensation are approved by ourChiefE.\l!cutive Officer.

E:ccctttivc Prry Policy The clements of our executive compensation policy are intended to meet the foiJo\\ing objectives: Base salary • Provide the ti'l!d element oft he comp~:nsation package • Be competitive in order to recruit and retain the best talent for our business and indusuy • Reinforce our business strutegies, management process and overall perfommnce Profit bonus • Jncentivize the achievement of specific profit goals over the short tem1 Guaranteed bonus • Aid in long•tennrctention through establishment ofspecified amounts for certain e:-=:cutives Long-tem1 incentives • lncentivlze executives to achieve superior returns • Aid in retention ofkey individuals Perquisites • Aid in retention ofkcy individuals Sevefilnce Benefits • Aid in retention ofkey individuals

Tph!c nfC'C'Ini(;UfS Specific Cf)mpcnsalfmt Efcmc11ts The principal components of our executive compensation progfilm are base salary 11nd a combination of guaranteed bonuses, profit bonuses llnd/orlong·tCmlincentive compensation, ns well ns 401(k) m.1tching contributions and I!Clllth care allowances. Ceria in executives ilrc illso entitled to severance benefits upon a tenninntion ofemployment under certain circumstances. We do not maintain supplemental retirement progralll!> or defined benefit pension pl:ms for our executive officers because we believe that the existing compensation nrrnngements ennble oure»:cutive officers to ade!]uately plan for their retirement.

Base Sala,;•: Base salaries nrc paid to our e:-2cutive officers to compensate them for the perfomvmce oftheir respective job duties and responsibilities. Base salaries of our executive officers are typically reviewed on nn annuel basis, In setting annual base salaries, the following are the primary factors Ia ken into considcfiltion: the e~cutive officer's performance, the petfonn:lnce of the operntions nnd deparlments for which he or she is responsible, changes in the scope oft he executive officer's job responsibilities and current compcnntion practices and trends in our industry, These factors arc reviewed on a wholly subjective basis, and no specific criteria are established with respect to individual, company ordepamncnt performance.

OurChiefExecutive Officer, as the sole beneficial owner ofourparcnt company, has historically set the salaries for all ofthe C»!cutives, including !tis own.

Projif Bonus: Mr. Biclss is entitled to receive a bonus based on a percentage of monthly profitabilhy based on internal measures as set by the C'nmrmnv. During 2012, Mr. Biclss' monthly profit bonus was based on 0.15% of an internal profit metric that measured the fee and inumm income from the applicable stores for which Mr. Biclss was responsible, less direct costs oflltose stores and less an allocated amount for corporate overhead C.\)}enses. This profit bonus is intended to directly align Mr. Bie!ss' pay with the perfom~aricc ofllte stores that he is responsible for managing. The amount of Mr. Bielss' profit bonus earned for2012 is reflected in the Non-Equity Incentive Plan Compensation column oft he Sumrr1.1ry Compensation Table.

GuaronW!!d Bonus: Guafilnteed bonuses for C).t:CUtives are detennined individually for each person. The bonuses nrc paid either monthly or annually. Ms. Nelson panicipates in a guaranteed bonus award incentive equal to 25% ofherbuse salary on an annual bonus, and Mr. Marohn received a guaranteed bonus ofS125,000 upon eompletion of his initial training period. Thg Cnmnnnv paid Mr. Marohn an ildditional bonus ofSJ25,000 in 2012 in lieu ofa profit-based bonus, with an Ciq)ectiltion that he will move co a profit-based bonus in future years.

During 2012, on II..Jr. Thomas' two-year anniversary with the Compnnv he received a guarnnteed bonus ofSJ35,000. These guaranteed bonuses are reflected in the Bonus column oft he Summ:uy Compensmion Table.

Umg.rcmJ/ncenfives: In 2011, we adopted the AutoC1sh Inc. (replaced by TMX Credit, Inc.) PhantomStockPlun, which authorizes the grant oflong•tennincentive nwards in the

0684 fonn ofplumtom stock units, or "PSUs" orph:mtom stock appreciation rights, or "PSAR..t." The phantom unit awards do not constitute ownership ofany membership or other equity interests of1hc Comrnnv or any ofits suhsidja!jc~. nor do they give the holder any voting rights. PSUs entitle the holderto receive a cash payment equal to the fuir value ofthc underlying shares ofstock in TMX Credit, Inc., subject to certain restrictions and to risk offorfeiture. The PSARs entitle the holder to receive a cash amount detemlincd by the appreciation in the fuir value ofdte underlying shares ofstock in TMX Credit, Inc. betwee11 the gmnt date oft he shares and the date ofcn:rcisc. The fair value of the phantom shares is equal to three times the EBITDA ofTMX Credit,lnc. for the 12months preceding any valuation date. Mr. Tretyakwas issued 50PSUs in 2011, which vest over three years from the date ofMnv 16 '>OP and become m<'lture llnd payable on the fourth armivcrsmy ofthc grunt date.

Pl!rquisitr:s: The C'ompnnv provides limited perquisites to its nnmed e~cutivc offic~rs. suelt as relocation assistance. Tite nnmed executive officers nlso receive health cnre benefits that are geuern!ly made available to other employees. In adPition, the OliefE\:ecutive Officer is entitled to use the Commmv's nircmll for non-business purposes. Incremento\ variable operoting com associated with such personal use and paid by the C'ornnmw totaled S29S,057 in 2012.

ML-: ofCompcnsntion Elcme11fs Other than the TMX Credit, Inc. PSUs described above with respect to Mr. Tretyak, the C()mpnnv does not have nny equity component to irs compensation nrrnngerm:nts fort he no.med e:.l:cutivc officers. As such, !he C()mnnnv believes that it is necessary to provide 11 highly competitive ct1sh based compensution package, as described above, to attroct and retain top talent. In addition, as recruiting talent with consumer finance and/or multi-unit e:-.perience often requires the relocntion of executives from othergeogmphic mnrkets, the Comnnnv offer:s relocation assistance to certain employees.

Severance al/li Tcrmlllaflou Arrangemeuts Curt'l!lll Named E:n:cnlivc Officers l'vlessrs, 1\·larohn and Tretyak have offer letters thou provide for payments upon a temlinntion of employment due to involuntary temlintltion. These tumngemcnts are descnbed in the: section entitled "Emp/oymcm Agrccml!llls!Ttmns ofEmployment." The Compnn"' believes that tl!cse ammgements aid in ntlmcting nnd retaining qunlificd c1-t:cutivcs to build vnluc without the fearoflosbtg employment for situations other than for cause or voluntary te_mtination.

Tnhlc ofCcm!cnt!; Executhe Compensntion Summny Comperuntion Tnlie The foUowing tab!~ summ:ui~s the total compensation enmed in 2012, 2011 and 2010 by our named eXI!cutive officers. In :~ddition, the following table includes our former Chief Fin:mcial Officer, Donald E. Thomas, whose employment with the l'ompnnv ended on Anmt.~t 21 2012.

Non-Equity fntenlhe Pl;m All Other flH~I s~tlll1' Bonus Compensation Compenution N:~me :md Prindl!lll Pasi!ion Year {Sl{l} ($)(3} {S\!4) To!al ' Tmc\• Youm: 2012 s 250,000 s s s 31)4,691 s 554,691 Olief&l!cutive Officer and 2011 250,000 325,997 575,997 President 2010 250,000 125,081 375,081 Ri7nhcth C_ Nclmn 2012 1S2,726 50.000 1,164 233,890 Chief Accountins Officer Otto \V. Bielss, HI 2012 150,000 359,470 2:5,135 534,605 Senior Vice President ofOperutions 201 I 150,000 291,914 6,789 448,703 2:010 185,000 62,500 72,665 83,812 403,977 Douglas W. Marohn 2012 262,500 250,000 8,024 520,524 Senior Vice President ofOperutions ArthurTrctynk 2012 500,000 2,502 502,502 Senior Vice President ofOperutions Donald E Thom<'ls• 2012 231,346 42,058{2) 5,495 278,S99 Fonner O!icfFinancial Officer 2011 316,058 172,942 17,046 506,046 2010 191,538 35,000 97,92:0 324,458

For ser.·ices perfonned from Apri12010 tl1rough August2012.

(I} Represents guaranteed bonus nmounts bnsed on the ammgcment outlined in each person's offer!encr, as applicable.

(2) Tile nmount of Mr. TI10mas' bonus represents the portion of his guurnnteed bonus for his second year of employment that was earned in 2012.

(3) Represents profil bonus amounts earned monthly or annually based on the arrnngcnu:nl outlined in each person's employment agreement or offer Jetter.

(4) TI1e follov.ing table reflects the items that nrc included in the All OtherCompensntion colunm for 2012:

Tnll!c of('ontcnt~ All Other Compensation Dct:lil P~r ulsiles Hen\lh

0685 C:~re Peuonal Total Relotntlon AIIOIV:III.tt Us~ ar 401(11) All Othtr N~me Anist~l\cc b Aircrrtft !'.blch Se,~r:tnce Com~cnntlon Tmcv Yonng s s s 298,056(c) s 6,635 s s 304,691 Eli7.1herh C. Nel~on 1,164 1,164 Otto W. Bie!ss,l!l 22,591(a.) 2,544 25,135 Douglas W. Marohn 2,250 5,774 8,024 ArthurTretyak 2,502 2,502 Donald E. Thomas 5,495 5,495

(a) Mr. Bielss was provided wilh a housir~g allowance in connection wilh his pending relocation to Tc:.as, where he wiU continue to serve as a Senior Vice President oflhe C'onm:mv (b) Prior to December 20ll,lhe C(lntmrw offered reimbursermnts for health premium costs incurred by employees in obtaining outside medical coverage. In 2012, Mr. Marohn was provided with three months ofheolth care nllownnc:es umil he was eligible to join the Comnnnv's new health plan.

(c) The f'nmnanv ca[culau!s the ~ggregate inc:rem:m\al costs of Mr. Young's persontll use ofthe oircrafi based on an hourly charge that inch1des the costs offuel, contmctlabor, crew trnvel and onboard catering. Since the Cnmnnnv's aircrnfl. are primarily used for business trove~ the calculatiort exeludes ful=d costs that do not change based on usage, such as pilots' salaries and the costs to acquire and maintain I he aircraft.

Tnhle ofC'nntent~ Grants ofPian-BascdA\mrds The following table sununarizes infommtion regarding plan-based awards grunted to each of our named el.l!Cutiveofficers in 2012: F.t!lmat~d Fulurc Payouu Und~r Non·Equil"l' fncenlin Plan Award~ Name Thnr~hald M:ulmum Trncv Yount: s s s FJimhelh (' Nelson OttoW.Bielss,IJI 291,914(1) Douglas W. Marohn ArthurTretyak Donald E Thomas

(l) Represents 11 cilsh incentive opportunity based upon a percentage of~n internal profit metric for the areas of! he business he is responsible for managing. on a monthly basis.

For Mr. Biel.ss, the percentage equals 0.15% of his assigned regions. By nature oft he award, the threshold, target and ma.'>Qmum payout are undctctminable 111 the time ofgrnnt.

Accordingly, as required under SEC rules, the amounts reflected in the table above are representative amounts based upon pcrfommnce in 2011.

£mpl.oyment Agreements/Terms of Employment Each named e:retutive officer, e»::ept for our 01iefE...-ecutive Officer, has an employment agreement, written offer !ener or verbal acreement that specifics the temiS of his or her overall compensation package as described below.

Fft·flht!lll <'. N,•fs,m: Ms. Nelson joined us in December2009 and was appointed 01ief Accounting Officer in August 2012. The tenns oft.,·ls. Nelson's employment as 01ief Accounting Officer were dctennined in an oral compensa1ion agroe1n:nt entered into on Au!·u~l 21 2012. Pursuant to the agreement, Ms. Nelson's base salaty was specified at an annual rate ofS200,000 and an annual bonus in the amount of2S% ofher base salary, · · Oua II~ Btclss,/11: Mr. Bielss joined us as a Senior Vice President ofOpera1ions in J:lnunl)' 2010. We executed an offer letter with Mr. Bielss t\1:11 specifies his base salary for 2010 at an annual raw of$200,000 and an annual bonus in the amount ofS75,000, pnid in monthly inslalbnents. Durir~g. 2010, Mr. Bietss as reed to a reduclion in s11lary co $150,000 and a discontinuance ofhis annual bonus. In re<um, Mr. Bielss was made eligible to panicipate in a profit bonus which is based on 0.15% of an internal monthly profitmellic:ls detennined by J.l.!.s. ~-The internal monthly profit mel ric me:~surcs the interest and fcc income from !he applicable stores for which Mr. Bie\ss is responsible for nmnaging, Jess dirctt costs ofthosc stores and less an allocated amoul\1 for corporate overhead e;qJenses. In Febnmy 2013, Mr. Bielss agreed ton discontinuance of his profit bonus in cn:hange for 11 food annual bonus amount ofS400,000 to be paid on a monthly basis.

Douglas W Marohn: Mr, Marohn joined us as a Senior Vice President ofOpemtions in August 201/. We executed an offer letter with Mr. M~rohn !hat specifies the terms ofhis base salary at an annual rate ofS262,500. Mr. Marohn's offer letter specifies a guaranteed bonus ofSJ25,000 paid upon completion of his training period and a profit bonus equal to a fu.:cd percentage of profit forthe area ofthe f'omnanv fur which he is responsible. The profit bonus hus not yet been implememed. Mr. Mr~rohn's offer letter ::~!so provides for severance upon involuntal)' tennination without cause in the amount ofsixtr.Onths of base salary, which would be conlingent upon e>:ecution of a separation agreement including a genernl release.

ArthurTrotyak: Mr. Tretyakjoined us as a Senior Vice President of Operations in May 2011. We executed an employment agreement with Mr. Tretyakth~t specifies his base saint)' alan annuill rate ofS500,000. Mr. Tretyak is eligible to receive an annual cash incentive opportunity equal to 5.0"/oofthe EBlTDA for the preceding fiscal year forTMX Credit, Inc. ln addition,lvfr. Tretyak is eligible to receive phantom stock awards under the TMX Credit Phantom Stock Plan. The employment agreement with Mr. Tretyak also provides that in the event of a temlination without Cause, or his resignation for Good Reason, he will be entitled to severance equal to six months' base salary, plus a pro-rated annual bonus forthe year oftcnninnlion.

In such an event, l\-lr. Tretyak would retain any PSUs which were vested at the time oftermination. Mr. Tretyak would be required to c~cute a separntion agreement including a seneral release of claims, reaffirmation of cenain restrictive covenants contained in his employment agreelt"ll!nt, and certain other promises, in a fonnaccep!able to the Cpmmmv.

T:thlc off'<lnt~n!~ Potcntinl Payments Upon Terminntion or Change of Control The infonnation below desco"bes the estimMed value of the potential payments that would have become payable to each named executive officer assuming a tenninalion of employment aml!or change of control had occurred on Pt•cen~>t!r:; I 1011, given the na1red e~cutive officers' compeiJSalion ns of such date. ForinfoiTlllltion regarding the employlllCrll agreements with each named executive officer, including a descriplion ofrights upon tennination of employinerlt under different circumstances and ofthe non-competilion covenants 0686 contained in the employment agreements, sec the section entitled "Employmwt Agrerments1 Terms ofEmployrmm/."

Payments Dill! to Tumim11iou bj• the Comnnm• Without Cnu,r~: Termlnalion wlllwut ccw.fe (and.jorMr. Trelyak, r<!slgnotfonjorGood Reason): Sever:tnt~ N:1m~ I Total Trnc\' Young s s s Elirnhe1h C'. Nel~on OnoW.Bie!ss,lll Douglas W. Marohn 131,250 131,250 ArthurTretyak 25D,OOO 250,000

(I) B~sed on six months ofthen-cmrenc base salaty, as specified in the respective individual's offer latter or employment agreamant.

(2) lvfr. Tretyak would be ilntitled to a pro-r.nad bonus upon termination widtout c~usc or for good reason. For2012, the amount of such pro-rated bonus would be SO. In tl1e event of a tennination for cause or a cltange in control without any tennination ofemployment, no executives would be entitled to any severance amounts or special payments.

Risk AssessmentofComJX!nsatian Policies and Prnctices The design :md operation of our incentive compensation ummgements for our employees, including the named eXI.!cutive officers, were reviewed for the purpose of determining whether such programs might encourage inappropri~te risk-taking that would be n::;~;sonably likely to have a material adverse effect on rhe C'mmmnv ln conducting its review, management considered the perfonnance objectives and tnrget !evc!s used in connection with these incentive arrangements and also the feMures oft he C'omn:ul\''S compensation progrnmtltat are designed to mitigate compensation-related risk Manugement concluded that !he C(!mmmv's compensation plans, progrnrru and policies, considered ns a whole, including applicable risk- mitigMion feature~. are not reasonably likely to have a material adverse effect on rhc Company.

T;thle nf('nntcng ITEM 12. SF.CURTrY()WNERSHJP OF CERTAIN B~EFJCIALOWNERS AI~D l\'IANAGE\1ENT AND RELATED STOCKHOLDER MA'ITERS.

Trncv Y(lunr•, the founder, 01ainnan of the Board, ChiefE.'Il!cutive Officer and President ofTMX Finance LLC, is the sole beneficial ovmer ofthe common stock ofTMX Finance Holdings !nc., which owns :~ll \OOofthe outstanding limited liability company interests in TMXFinance LLC. Mr. Young's address is IS Bull Street, Suite 200. ~:wann;th, n:omia ;1401 No director, officer or employee ofthe C'onmnnv or any other person, hilS any option, warrant or other right to ucquire any ownership intere$1 in TMX Finance LLC and there are uo compen~ation plans that provide for the is~uance of equity compensation to ;my person.

ITEM 13. CEnTAL~ REL\ TIONSIHPS AND RELATED 'ffiANSACfiONS, AND DmECTOR INDEPFJ\'DENCE.

Transactions "ith TMX Fimmcc Holdings Inc. Effective Sentcmhcr 30 2012 Mr. Young trnnsfcrrcd 100% ofhis membership interests b1 TMX Finance LLC to newly-fanned TMX Finnnce Holdings Inc., or the "Panmr," in exchnnge for shares ofconunon stackofthe Pnrent. On Octnhcr 17 "01", the CC'Impnnv distributed S350,000to the Parent. On Oet(lher31 :!OP, the Parent issued S\00.0 million ofseniorPIK notes, orthe "P/K Notes, ''that beilrinterest 111 II% per year and nre due October 1'i "015, Under the tenns oft he inrlemur.:: governing the PIK Notes, interest on the PJK Notes is payable in cnsh to the c:>lent distributions arc nvai!able under the tenm oft he indentur.:: govcming the Conm:my's Notes. If distributions :~re not permitted under the tenns oft he indenture governing the CC'Imnmt"'s Notes, the Parent may issue additional PIK notes in u principal amount to satisfy the interc>t dua. Distributions from the f'nmnnnv to the Parent, when pemlitted, will provide the primaty means for the Parent to make nny cash interest payments on the PIK Notes.

Re!!l Fstnte Unses We lease our corporate headquaners from Parker-Young, LLC, or "Pl'." PYis owned 50% by the Sole Shareholder und 50% by an unrelated third pany. The initial tennofthis \ease espires in 2015, followed by twa ten-ye;n options to renew. As ofDccemhcr:>l 2012 we leased four retail spaces from TY!nvestmenu, LLC, or "TYI," which is wholly-owned by the Sole Sharel10lder, :~nd two retail spaces ITomTMXInvestment~, LLC, or "TMXI." 3 whollyo{lwned subsidiaty ofTYI. These retail spaces were acquired by TYI and T1\fXJ, tiS applicoble, and subsequenrly !eosed to us because they ::~re located in areas whare we could not secure sat is factory leases from other panies. We 3lso lease two condominium units in Savannt~ll, Georgia from TYJ, which are prirnarily used as a relocntion benefit to auract ne\\' tronagemcnt.

Rental payments to PYwcrc appro>imately .$0.2 million for the year ended nec,;mher ."ll 2012, Rental puymcn ts to TYI and TMXl totakd appro:dmately $0.2 million for the year ended Drcemher11 10)?.

Airpl:rnc Payments TMG is a pa11y to an Aircraft Reimbursement Agreement with Aviation. Under this agrec!T><:!nt, we reimburse Aviation fora!! costs it incurred in connection with the ownership and operntion ofaircraO used by us, including debt servicing for an airplane and hangar, insur;mce, a full time pilot and fuel and m.1intenance costs. llte reimbursement agreement limits our reimbursement obligations to S3.0 million per year. Total payments to Avial ion under this agreement were appro>.imately SJ.3 million for the year ended D.;et•mher 3 l 2012.

In Januaty 2011, TMGentercd into a Non-Exclusive Aircraft Lease Agreement with Aviation. Under this agreement, Aviation leases to TMGan aircraft owned by Avi~tion on a non~ eXt:lusive basis for a rental chaq;e ofS200,000 per month beginning in Apri1201I. Tat~l payments to Aviation under this agreement were appro:cimatcly S2.4 million for the year ended Decemher31 'lOP.

An airplane owned by Aviation is collateral for a Joan to the Sole Shareholder from a third party with a balance as of Januaty land Qcccmher; 1 "01') of approximately $3.1 million and S2.8 million, respectively, with repayment oft he loan guaranteed by us. The note is payable in monthly installments of£35,000, including interest and principal. The note has a fi.\l:d interest ra\e of6.35% and has a final payment of$2.1 million due in October2015. The total amounts of principal and interest paid on this loan by the Sole Shareholder were :~pproximately S0.2 nullion and $0.2 nllllion, respectively, for the year ended Decemher 31 2011 Related to Aviation's purclmse ofan additional :~irplane in Novernber2010, we loaned the Sole Shareholder $2.0 million at 12% interest, due in November2014. l11e balance oft his nate at January I and Decemhcr 31 '~OJ') was appro>.irrutely SLS million nnd SJ.I million, respectively. The !Otlll amounts of principal and interest paid by the Sole Shareholder on this loan were approximately SO.S million and SD.2 million, respectively, for the yenrendcd D.::cemher 11 10p.

0687

Tnhli! nfC'on1en1s Working Caritallnclebteclness A former President ofTMX FiMnce had an employment agreement with TMXFinnnce with a term through pw:mher~! 101 I. Pursunnt to the employment agreement, ourfomx:r President was entitled to receive, in addition to his base salary, an annual profit sharing bonus equallo 1.5% ofour earnings before interest, 111~s; nmortization and depreciation. The employment agreement included a provision granting our fonner President the option to c:~rhange $.2.0 million of debt for a 3% interest in TMX Finance. The employment agreement was nrnended effective as of Jnnuarv I 2010 to replace this equity option with a grnnt ofphantomunits. The plumtom units, which were fuUy vested, represented the right to receive a cash payment equal to the difference, ifpositive, between $2.0 million a.nd an a.mount equal to 3% oftht: fair market value oft he outstttnding membership interests ofTMXFin1111ce, This amount was paid during 2012.

In May 2010, in response to significnnt demand for our product, the Sole Shareholder made nn interim equity contn'bution ofS2.9 million to the C'onmnnv to ensure adequate cash availability for the business. Following the issuance ofS250.0million ofNotes In June 2010, TMXFinancc made a distn'bmion to the Sole Sht~reho!der in an amount equal to the amount of this intctimequiry contnbU!ion. In July 2012 and November2012, the Sole Shm:holdcrmadeadditional equity contributions ofSJ4.0miUion and $44,8million, respectively, to Company.

Formoreinfo~tion regarding re\ated·party activities,see Note 12to our consolidated finoncial statements in "Jtvm8. Financial StatcmwlsandSupplvm~ntary Data" and "Item 7.

Management's Discussion and Analysis ofFinancial Condition and Results ofOperations-Other /lldchtcdm:.rs."

Policies and Procedures for Rc\icw, Appro\'nl nntl Ratification ofRclatcd Party Transactions The Board ofManagers ofTMX Finance is drntling a related party trunsaction policy. Currently, the Board ofManagers must conform to the related party requirements included in the~ for the senior secured notes. The ~requires related party IIOlnsactions 10 (I) be no Jess favorable than an ann's length tronsaclion with n person who is not a related pnrty, (2) be approved by a majority ofthe non-employee m1nagers if the trnnsaction is greaterthnn S3 million ~nd (3) for tmnsaclions greater thnn S7.5 million, be delemUned to be fair from a financial point of view based upon an opinion provided by a third party fmn of national standing. The Board ofManagers will e1Wlmine all related pony tmnsnctions using the tenns ofthe Indenture until sucl1 time ilS the C'onmony's own policy is fonnally adopted.

Compens:1tion Interlocks ami Insider P:1rtici[X1tion The Sole Shareholder detemrined the compensation ofoure»!cutive officers for the fiscal year ended December~ 1 2012. No executive officer ofthc C'ommmv served during 2012 on the Board of Directors or Compensation Committee of any other entity that had an exe~utive officer who served as a manaser or director ofthc C'omnnnv or on i\n)' Compensation Commi11ee of ours at any time during 2012.

Tnhlc ofC'mll~nts ITE!\114. PIUNCIPALACCOUNTANTFEES AND SERVICES.

The following l3blc presents fees and c,;pcnses bilkd for professional services provided by McCilndrev l.l.P and RSM McG!aclrey, Inc, (through Novcmhcr ::.o ?OJ I) for 2012 and 2011.

y.,nr Ended Deeember 31, Z()J2 :!011 Audit Fees s 680,883 s 698,176 Audit·Rclnted Fees 36,191 509,879 Tax Fees 3,300 364,175 All Other Fees 13,1:59 Total Fees s 720,374 s 1,585,389 Audit Pcr:.r: Consists of fees and C)\Jlenscs for professional services rendered for the oudit of our consolidated fmnncial statements, review ofthe interim consolidated financial stntements included in quarterly reports, and services normally provided in connection with statutory and regulatory filings.

Audit· Rclot~d F~cs: Consists of fees and e:vcnses for professional services provided in connection wilh our Notes offering (in 2011) and nudit of our retirerront savings plan.

Ta.~ F<!c.~: Consists of fees and expenses forprofessimml services provided rclnting to tax planning ilnd compliance scr.·iccs, and assistance with lax audits and appeals.

All Other Fvr:s: Consists of fees other thlm the professional services reponed above. Tite services provided in 2011 were related to unclaimed property research.

All audit and non·audit services provided by lvleCilndrcv l.l.P and RSM McG!adrey, Inc. (through November 30 20\ I) are pre·approved by the Omimun oft he Board ofManagers tllld Olief~cutive Officer, who considers whether the pro,•ision oft he non-audit 5crvices is compatible with the maintenance of that finn's independence in the conduct of its auditing functions. The non·audit services pro\'ided by McC"'~ndrev U.P and RS~f McG!adrey, Inc. (through No\'cmhel' ~0 ?Q)l) in 2012 and 2011 were pre·approved in aecordancewith this policy and communicated to the remainder ofthe Board ofMan11gers.

T.nhh! ofC'ontcnts PARTlY ITEM 15. EXHIBITS AND FINA.i...,CIALSTA'fEMENT SCHEDULES.

(a}(l) Fimmci:tJ Statements The information required by this Item is included in "Item 8. Financial Srotcmcnfs and Suppl<!mCJIWry Dalll."

(a){2) Fin:md:tl Stntement Sclmlules

0688 AU schedules, for which provision is made in the applicable accountin£ regulations oft he SEC, have been omitled because they are not required under the related instructions, are not applicable or the information has been provided in the consolidated financi~l statements or the notes thereto, included in "Item 8. Financial Statements and Supplemelllary Data.

(a){3) E."dlil:ilS E•;hibits marl<ed with an asterisk(~) are incomomted bv reference to e:U1ibits or appendices previonslv fj!ed with the SEC, as indicated by the references in paremlieses. AU other eiliibits are filed or furnished herewith. Oureurrent, quarterly and annual Repons are filed with the SEC under File No. 33:i-172244. Our ReJ;istration Statements have the file numbern noted wherever such statements are identified in the fo!lowin£ list of exhibits.

Thhiblt No. D•••rl linn nf Exhlb\1 Certificate ofFonmtion ofTMX Finance LLC, date"d Sente111ber 15 1003 (E,:hibit 3.1 to TMX"Finance LLC's Registration StotemcnJ on Fonn S-4, dnted Fchnwrv J.l ?OJJ, is incorpornted herein by this reference) First Amendment to the Certificate ofFormation ofTMX Finance LLC, dated tune 18 1010(E"41ibit3.2 to TMX Finnnce LLC's Registration Statement on FormS-4, dated Fchnwry !4 JQJ 1 is incorporated herein by this reference) 3.3~ Amended and Restated Operating Agreement ofTMX Finoncc LLC, dated Jun~ 21 2010 (Exhibit 3.3\o TMXFinonce LLC's Registration Statement on FormS-4, dated FchnHI!'\' 14 20! I is incorpomted herein by this reference) 4.!~ ~dated J\Lnc 11 1010, ~lOOn£ TMX Finance LLC and TilleMa>:Finance Corporation as Issuers, the gunrantors party thereto, and Wells Fargo Bank, National Association as Trustee nnd Col!awaiAgent, including the guaranteetmd the fonn of 1325% senior secured note due 2015 (E\hibit4.1 to TMXFinance LLC's Registration Statement on Form S-4, dnted Fehnmrv 14 2011, is incorpornted herein by this reference) 4.2"' First Supplemental~. dated M~v IJ ?Q1t,among TMX Finance LLCand TitleMaxFinance Corporation as Issuers, the gu:~rantors p~ny thereto, and Wells Fargo Bank, Nation;,] Association as Trustee and Collateral Agent, including the guarantee ~nd the form of 13.25% senior secured note due 2015 (E.'hibit 4.2 to TMX Finance LLC's Registration Statement on Fonn S-4, dated Serternher 10 201 I, is incorporated herein by this reference) ., Second SupplciTlCntallmlenture, dated !nne 5 2012, among TMX Finance LLC and TitleMnxFinance Corporation as Issuers, the guarantors pany thereto, and 4.> Wel!s Fargo Bank, National Associ~cion as Trustee and CoU:uernl Agent (e~ibit 4.3to TMXFinance LLC's Quarterly Repon on Fonn 10-Q, dated Am•nl'l 20 lQU, is incorporated herein by this reference) 4.4" Third Supplemental~, dated Julv 20 2012, among TMXFinance LLCand TitleMaxFinance Corporation as Issuers, the guarantors pany thereto, and Wells Fargo B:mk, Nation~] Association as Trustee and Collateral Agent (exhibit 4.4'to TMXFinance LLC's Quartt:rly Report on Fom1 10-Q, dated Amm~l 20 2Q11, is incorporated herein by this reference) lO.l• Aircrnfi Reimburst:ment Agre~n~nt dated Jnnllllrv 1 2011, by and amOn£ TitleMaxofGcorgia, Inc., a Georgia corporation, TitleMaxAviation, fnt:,, a Delaware corporation, and TMXA, LLC. a Dcla\Yare limited liability company (£\l!ibil10.3 to TMX Finant:e U.C's Registration Statement on Fom1 S-4, dated Eehmmv 14 .:ill.!!. is incmpomtel! herein by this reference) 10.2 First Amendment to Aircraft Reimbursement Agreement dated Janmuv I 1012, by and amons; TitlcMaxofGeorgia,lnc., a Georgia corporntion, and Tit!eMax Aviation, Inc., ll Delaware corporation

F:xhlbi! No. lOY Non·E'\Ciusive Aircraft Lcnse Agreement doted lmumry I "l(H! by and between TitleMaxAvintion, Inc. and TitleMaxofGeorgia, Inc. (E-Jiibit 10.4to All'l<!ndment No. Ito TMX Finance LLC's Registration Statement on FomtS-4, dated Mnrch ::;u 101 I, is incorporated herein by this reference) 10.4* Servicing Agreement dated April19 1009by and between Equity Auto Loan, LLCand TitleMaxofGeorgia, Inc. (E\hibit !O.Sto Amendment No.2 to TMX Finance LLC's Registrntion Statemem on Form S-4, dated A mil !lJ 101 1, is incorpornted herein by this reference) 10.5"" Renl Estate Lease Agreement dated Janmuv 1 1009by and between TMX Investments, LLCand TitleMaxofMissouri,lnc. (E-d!ibit 10.6to Amendment No. lto TMXFinance LLC's Registration Statement on FonnS-4, dated March :;o 1011, is incorporated herein by this reference) Real Estate Lense Agreement dated Sentemhcr 1 ?flO& by and between TV Investments, LLCand Ti!feMaxofGcorgia, Inc. (E\hibit 10.7 to Amendment No. lto TMX Finance LLC's Registration Statemen! on FonnS-4, dated Mnrch ::iO. 201 I, is incorporated herein by this reference) Real Estate Lease Agreement dated Septemhcr I 100s by and between TY!nvestments, LLCand TitleMaxofGeorgia, Inc. (E~1ibit 10.8 to Am;:mdment No. I to TMX Finance LLC's Registration Statement on Fonn S-4, dated Mnrch ::;o 2011, is incorporuted herein by this reference) 10.8• Sublease Agreement dated An<>ust 29 200Sby and among Tit!eMaxofGcorgia, Inc., Equity Auto Loan, LLC,and National Retail Properties LP (E~1ibit 10.9to Amendmem No. Ito TMX Finance LLC's Registration Statement on Fonn S-4, dated l\fnrch l.O 1011, is incotporoted herein by this reference) Real Estate Lease Agreement dated Sepl\'l!llwr I "l.fiOSby and bt:tween TV Investments, LLC3nd TitleM3xofMissouri,lnc. (E'Il1ibit 10.\0to Amendment No. Ito TMX Finance LLC's Registrntion Statement on Fonn S-4, dated March :m. ?OJ I, is incorporo!cd herein by this reference) 10.10" Real Estnte Lease Agrc~ment dllt~d Jmmmv I 1009by nnd between TY Investments, LLCand TitlelvlaxofMississipp~ Inc. (E'Il1ibit 10.11 to Amendment No. Ito TMX Finance LLC's Registration Stalement on Fonn S-4, dated iy!nrch 30_ 2011, is incorporoted herein by this reference) 10.\l" Real Estate Lease Agreement dated Am·H~t 1 ~007by and between TV Investments, LLCand TitleMaxoflllinois,lnc. {E.\ltibit10.12 to Amendment No. I to TMX Finance LLC's Registration Statement on Form S-4, dated ly!nrch 10 201 I, is incorporated herein by this reference)

10.12" Real Estate Lease Agreemem dnted Septern1wr 1 1007 by and betwce11 TYlnvestmcnts, LLCnnd TitleMnxofVlfginia, Inc. {E'Ii1ibit !O.Bto Amendment No. I to TMX Finance LLC's Registration Statement on Fonn S-4, dated 1\·l<~rch JO. 1011, is incorporated herein by this reference) 10.13" Real Estate Lease Agreernem dated hill' 1 2007 by and between TYlnvestments, LLCand TitleMaxofGeorgia, Inc. (Exhibit 10.14to Amendment No. Ito TMX Finance LLC's Registralion Statement on Form S--4, dated Nlnrch >O :Wll, is incorpornted herdn by this reference)

0689 10.14* Ren! Estate Lease Agreement dated Serten~•cr I 7007by and between TYlnvcstments, LLCand TiHeMaxofMissouri, Inc. (fuhibit 10.15 to Amcndmcnt No. I to TMXFinancc LLC's Registrntion Stntcment on FonnS-4, doted Mnrch .iO 1 011, is incorpomted herein by this reference) !O.JS• Ren1Fstate Lease Agreement dntcd 1ulv 'I. "007 by Hnd between TYinvestmenls, LLCand TitleMnxofSouth Cmolina, l11c. {E"Illibit 10.16 to Amendme11t No. Ito TMX Finance LLC's Registrntion Statement on FormS-4, dated Mnrch :;o "011, is incorporo.ted herein by this reference) Renl Estate Lease Agreement dated Novemher"O 1007 by and between TY!nvestments, LLCand TitleMaxofMissouri, lnc. (E\hibitl0.17to Amendment No.1 to TMX Finnnce LLC's Registration Stntement on FonnS-4,dated Mm'Ch 30 20! l, is incorponued herein by this reference) Real Estate Lease Agreement by and between TYinvestments, LLCand TitleMaxofSouth carolina, Inc. (E-.dlibitl0.18to Amendment No. Ito TMXFinance UC's Registrntion Stntement on Form S-4, dated March .iO 2011, is incorporated herein by this reference) 10.18• Real .Estate Lease t\greement dated Anri1.i0 200Rby and between TYinvestments.LLCand TitleMnxofG!orgia, Inc. (E-itibit 10.19to Amendment No. I to Tl-.-fX Finance LLC's Registrntion Stntcmant on Fonn S-4, dated Mi'lrch .iO. 2011, is incorporated herdn by this reference)

Ttih1e of Contents Exhibit No. Dtstri lion of Exhibit Employment OfferletterofOtto Bielss dated Occemhcr 14 2000<F..,·hihit I0.22to Amendment No. I to TMX Finance LLC's Registrntion Statement on FomiS-4, dated !...larch 1{1 '011, is inco~porated herein by this reference) Oml Compensntion Agreement with FJirnh~th C. Ncl~on, entered into on Angnst 21 201' (TMX Finance LLC's Current Report on Fonn &-K, dated illUll!&21.

2Ql2, is incorpor.~ted lu:rein by this reference) l0.21t Employment Offer LenerofDougl~s Marohn dated June'> 70!1 10.22t Employment Agreement of ArthurTrctyak dated ~:lilY I6 '01 I 10.23t Amended :md Restnted Phantom Stock Plan dated .!nne 17 'OJ!

21.1 31.1 Certification Pursunnt to Rule \5d-14(n), as Adopted Pursuant to Section 302 ofthe Sarbanes-0.-.:ley Act of2002, sig;ncd by the ChiefE'=!!cutive Officer 31.2 Certification Pursuant 10 Rule 15d-14(n) us Adopted Pursuant to Section 302 of the Snrb~nes-0.-dey Act of2002, sirmcd by the ChiefFinnncial Oflker 32.1 CertificMion Pursunnt to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906ofthe Sarbancs-0.-.:ley Act of2002, signed by the 01icfE-..r:cutive Officer 32.2 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906ofthe S3rbancs-O~ay Act of2002, signed by the OtiefFinancial Officer 101 Interactive Data File: (i) Consolidated Bal3nce Sheets as off)eccmbcr ::>1 "'~01" and December ~I "'IOJ I; (ii) Consolidated Statemants of!ncomc for the Years Ended Deccml1er ~ 1 20]" JQL!..and 2!1ll!; (iii) Consolidated Statements ofCash flows for the Yenrs Ended O?cemhcr :>I 2017, JQL!.. and 2010; and (iv) Notes to Consolidated Financial Statements

t E'=!!cuti\'e compensiltion pl3ll or agreement,

Tnhlc: ofContent~ SIGNATURFS Pursuant to the requirements ofScction 13 or 15(<1) of the Securities E~hange Act of 1934, the rcgi~tmnt has duly caused this report to be signed on its behalfby the undersigned, thereunto duly authorized, D~te: Mnrch 27 "011 TMX FINANCELLC By: lsi TRACJ'ml/1\'G Trncv Ynung ChiefE.>J:cutivc Officer and Manager Pursuant to the requirements ofthe Securities £-:change Act of 1934, this repo11 has been signed by the following persons on behalfof1he re1•i~1mntand in the CD.pacities and on the dates indicated.

N:~me Title 0:\\1'.

lsi Trnct• l~mll" Oli~fE\:Ccutive Offic~rand Manager Tmcv Yonnq (principal e:-:ecutive officer) lsi E/l·ahrt/i C Ni!/.mu 01icf Accounting Officer {principal F.li7ahe!h C. Nelson financial and accounting officer) lsi R11hcrf F. Pjrklc Manager j\"lnrs;h 'l7 2011

0690 Robert F Pirkle lsi ,fohn G, Keuuedv fll Manager M~rch 27 "013 John Q Kenncdv Ill

Dates Referenced Herein and Documents InCotpOrated By Reference 7J1iro lfl-K Ellinf!. Date Qtlrer filinr:.s ~ 9/25/03 7/1/07 7121/07 8/3/07 9/1/07 11/20/07 4/30/08 8/29/08 9/1/08 12/31/08 1/1/09 41!9/09 4/20/09 101!/09 12/14/09 12/31/09 1/!110 4/12/10 61181!0 6121110 7/1/10 7121110 12131/10 1/1/11 2/1 Oil!

2/14/11 S-4 3/30/11 S-4/A 4/19/11 S=!!IA 5/13111 5/16/ll 6/91!1 6/16/!1 61171!1 7/221!1 9/16/11 S-4 11/301!!

121!/11 12/31/ll 10-f( R~K 1/1/!2 51!/12 5/16/12 6/5/12 6/181!2 6/27112 1\:K 7/201!2 7/27112 8/201!2 lQ,Q 8/211!2 1\:K 8/27112 R-K 9/30112 lQ,Q !0/171!2 10/31/12 R-K 12/15/12 0691 EXHIBITC I

0692 Goebelsmann, Christina From: Powers, Sarah Sent: Wednesday, July 02, 2014 8:12 PM To: 'Geoff Gannaway'; Goebelsmann, Christina Cc: '[email protected]'; Wargo, Joseph D.

Subject: RE: My motion Attachments: TMax--30b6 deposition notice to TMX Finance LLC.docx

Geoff- Dn June 25, you indicated that you intended to file a motion. We insisted on a meet and confer and you refused to change your position. When pressed as to the proposal for deposition limits, you only agreed to consider a "modest" increase from a proposal that would have resulted in LoanStar being able to take only approximately one or two additional depositions. Given your indication that you would only agree to a "modest" limitation, we cannot agree, especially as additional evidence ofTitleMax's wrongdoing continues to emerge. If you are willing to change your position, we may be able to come to an agreement.

However, in a good-faith effort to compromise, we have significantly revised and narrowed the proposed 30(b)(6), attached in red line for your convenience. This draft is directed to TMX Finance LLC; if we are able to come to an agreement, we will also prepare similar notices to TMX Finance TX and Title Max TX. As discussed before, we may be able to further narrow the topics if you are willing to agree to accept additional interrogatories in the alternative.

We remain willing to discuss.

Sincerely,

Sarah F. Powers WARGO FRENCH 1888 Century Park East, Suite 1520 Los Angeles, California 90067 Telephone: (310) 853-6453 (direct) Facsimile: (3 I 0) 853-6333 E-Mail: [email protected] Website: www.wargofrench.com WARGO FRENCH I Ill= A\!anta I Los Angeles 1 M1am1

The information in this message is intended for the addressee only and may contain privileged and confidential infonnation. If you are not the intended recipient, please immediately stop reading this message, delete it from your system and notify the sender at [email protected] that it has been deleted. Any unauthorized reading, distribution, dissemination, copying, or other use of the infonnation in this message is strictly prohibited.

From: Geoff Gannaway [mailto:[email protected]] Sent: Wednesday, July 02, 2014 5:19PM To: Powers, Sarah; Goebelsmann, Christina

0693 Cc: '[email protected]' Subject: My motion Is there any word yet on any alternate proposal for deposition limits, or on a revised list of corporate rep topics, per our discussion on Monday? As 1indicated, I would like to get my motion on file this week, so I need to hear from you soon.

GEOFF GANNAWAY Partner

Beck IRedden~ Beck Redden LLP 1221 McKinney St., Suite 4500 Houston, TX 77010 Phone 713.951.6263 Fax 713.951.3720 [email protected] WW'N.beckredden.com

0694 NO. 2013-33584 WELLS HIRE FINANCIAL SERVICES, LLC, § IN THE DISTRICT COURT d/b/a LOAN STAR TITLE LOANS, d/b/a § MONEYMAX TITLE LOANS, and d/b/a § LOANMAX; MEADOWWOOD FINANCIAL § SERVICES, LLC, d/b/a LOANSTAR TITLE § LOANS, and d/b/a MONEYMAX TITLE LOANS; § and INTEGRJTY TEXAS FUNDING, LP, § § OF HARRJS COUNTY, TEXAS Plaintiffs, § § v. § § TMX FINANCE HOLDINGS, INC.; § TMX FINANCE, LLC; § TMX FINANCE OF TEXAS, INC.; and § TITLEMAX OF TEXAS, INC., § 152'' JUDICIAL DISTRJCT Defendants.

PLAINTIFFS' NOTICE OF THE ORAL AND VIDEOTAPED DEPOSITION OF THE CORPORATE REPRESENTATIVE OF TMX FINANCE, LLC To: Defendant, TMX FINANCE, LLC, by and through its attorney of record, David Beck, BECK REDDEN LLP, I 221 McKinney St., Suite 4500, Houston, Texas 77010.

Please take notice that, in accordance with Rule 199.2(b){l) of the Texas Rules of Civil Procedure the deposition of one or more corporate representatives ofTMX Finance, LLC ("TMX Finance") will be taken by Wargo & French LLP, counsel for Wellshire Financial Services, LLC, d/b/a LoanStar Title Loans and Integrity Texas Funding, LP, at ----~ on

The deposition will continue from day to day until completed and will be taken by stenographic, as well as videographic, means by a certified court reporter.

TMX Finance's corporate representative will be requested to testify on behalf of the corporation on the topic(s) listed on the attached Exhibit A.

Respectfully submitted this _ _day of June, 2014.

0695 SUTHERLAND ASBILL & BRENNAN LLP By: Kent C. Sullivan (SBN 19487300) Daniel Johnson (SBN 24046165) Robert A. Lemus (SBN 24052225) 1001 Fannin, Suite 3700 Houston, Texas 77002 Telephone: (713) 470-6100 Facsimile: (713) 654-1301 E-mail: ken t.sul !ivanrcusutherland.com E-mail: daniel. [email protected] E-mail: [email protected] And WARGO & FRENCH LLP Joseph D. Wargo (GA No. 738764) (Admitted Pro Hac Vice) Abigail J. Stecker (CA No. 284534) (Pro Hac Vice in Process) Peachtree Street, N.E., 26111 Floor Atlanta, Georgia 30309 Telephone: (404) 853-1500 Facsimile: (404) 853-1501 E-Mail: [email protected] E-Mail: [email protected] Sarah F. Powers (CA No. 238184) (Admitted Pro Hac Vice) Christina L. Goebelsmann (CA No. 273379) (Admitted Pro Hac Vice) 1888 Century ParkE Suite 1520 Los Angeles. California 90067 Telephone: (310) 853-6300 Facsimile: {310) 853-6333 E-Mail: [email protected] E-Mail: [email protected] Attorneys for Plaintiff Wells/tire Financial Sen,ices, LLC d/b/a Loan Star Title Loans and Integrity Texas Funding, LP

0696 CERTIFICATE OF SERVICE This is to certify that I have this day served all parties with a copy of the foregoing Notice of Oral and Videotaped Deposition in accordance with Rules 2la and 191.5 of the Texas Rules of Civil Procedure on June_, 2014.

Daniel Johnson

0697 EXHIBIT"A" INSTRUCTIONS AND DEFINITIONS _!._ _ The relevant timeframe for the topics listed is November 2010£ej3teml:1er 2911 to the present, unless otherwise indicated.

+.-1. "Customers of Competitors" means the customers of anv non-TitleMax car title lender in the state ofTexas.

~1..___"Integrity" means Integrity Texas Funding, LP.

J.:L_"LoanStar" means LoanStar Title Loans.

4. "TMX Finance TX" means Defendant TMX Finance ofTexas,lnc. its successors, predecessors, divisions, subsidiaries, affiliates, present and former officers, agents, employees, and all other persons acting on behalf of Defendant TMX Finance of Texas, Inc. or its successors, predecessors, divisions, subsidiaries, and affiliates.

5. "TitleMax TX" means Defendant Titlernax of Texas, Inc. its successors, predecessors, divisions, subsidiaries, affiliates, present and former officers, agents, employees, and all other persons acting on behalf of Defendant Titlemax of Texas, Inc. or its successors, predecessors, divisions, subsidiaries, and affiliates.

6. "You," "your," or "TMX Finance" means Defendant TMX Finance, LLC, its successors, predecessors, divisions, present and former officers, agents, employees, and all·other persons acting on behalf of Defendant TMX Finance, LLC or its successors, predecessors, or divisions.

4:-.i__ "DataTrax" means www.Datatraxonline.com, betadatatraxdotnet.zebec.net, or any website used for the purpose of accessing DMV records that either (1) includes the term "datatrax" or (2) is owned or operated by Zebec, Inc. ~fr:___"PublicData" means www.publicdata.com or any website used for the purpose of accessing DMV records that is owned and operated by The Source for Public Data, LP.

4,_7.__ "DMV Databases" means any database or website that contains DMV Records, including but not limited to the following: a. DataTrax, www.Datatraxonline.com, betadatatraxdotnet.zebec.net, or any website used for the purpose of accessing DMV Records that either (1) includes the term "Datatrax" or (2) is owned or operated by Zebec, Inc.; b. PublicData, www.publicdata.com, or any website used for the purpose of accessing DMV records that is owned and operated by The Source for Public Data, LP; and

0698 c. the Texas Department of Motor Vehicles website.

_7._ _ "DMV Records" means records available through the DMV, no matter whether accessed through a third-party vendor or otherwise, and including personal information about an individual, such as home address and the holder of any liens on the individuaPs vehicle.

+.S. "Litigation" means any action or proceeding in which You are alleged to have misappropriated or otherwise interfered with Customers of Competitors or lists of Customers of Competitors.

&.2:.__ "Loan', or "loans" means a loan secured by the title to a vehicle.

Q....ill,__ "Marketing" means the action or business of promoting and selling products or services, including market research and advertising. To "Market" means to promote or sell products or services.

+4:-l.L...._ccOverlap List" means the overlap list of customers prepared by the Special Master appointed in this a~tion and transmitted to the parties on or about December 16, 2013 .

.f..l-:.11. "Refinance" or "refinances" means a loan secured by the title to a vehicle that involves the replacement of an existing loan on the vehicle.

g.l.1._ "Parent Company'' means any company or companies that hold an ownership interest in You, whether through ownership of stock, membership interests, or otherwise.

l.i__"Subsidiary'' means any company with operations and/or offices in Texas in which You own more than 50% of the stock or membership interests, or that You otherwise control..

4-J.:.l5. "TitleMax" means the car title Joan company or comoanies opemting under the brand name TitleMax.

+4:-.l.Q,_"Affiliate" means any company with operations and/or offices in Texas that is not a Parent Company or Subsidiary, but that is related to You in one or more of the following ways: a, Any company in which You own less than 50% of the stock or membership interests; or b. Any company that is controlled or more than 50% owned by Your Parent Company.

+§..:.1..1._"TMX StoreNumbcr" means the number appearing on the Overlap List under the column labeled "TMX StoreNumber."

+4:1Jh._ "Person" means any natural person, corporation, firm, association, partnership, joint venture, proprietorship, governmental body, or any other organization, business, or legal entity, and all predecessors or successors in interest.

0699 .J+...L:L_"Possession, custody, or control" of an item means that the person either has physical possession of the item or has a right to possession equal or superior to that of the person who has physical possession of the item.

+&-20. "Refer'' or "relate to" means as well as tenses thereof, mean, refer to and include any tangible thing which is in any way relevant, refers, reflects, memorializes, evidences, contains, embodies, constitutes, states, identifies, describes or pertains to all, or any portion of, the specified facts, contentions, statements and describe categories of documents requested and subject matters thereof.

W-:-21. "Document" means all written, typed, or printed matters, and all magnetic, electronic, or other records or documentation of any kind or description in your actual possession, custody, or control, including those in the possession, custody, or control of any and all present or former directors, officers, employees, consultants, accountants, attorneys or other agents, whether or not prepared by you, that constitute or contain matters relevant to the subject matter of the action.

2-<+:.22. "Identify" or "describe," when referring to a person, means you must state the following: a. The full name.

b. The present or last known residential address and residential telephone number.

c. The present or last known office address and office telephone number.

d. The occupation, job title, employer, and employer's address at the time of the event or period referred to in each particular interrogatory.

e. In the case of an entity, identify the officer, employee, or agent most closely connected with the subject matter of the interrogatory and the officer who is responsible of supervising that officer or employee.

~23 "Identify" or "describe," when referring to a document, means you must state the following: a. The nature of the document (e.g., letter, handwritten note).

b. The title or heading that appears on the document.

c. The date of the document and date of each addendum, supplement or other addition or change.

d. The identities of the author, signer of the document, and persons on whose behalf or at whose request or direction the document was prepared or delivered.

0700 e. The present location of the document and the name, address, position or title, and telephone number of the person or persons having custody of the document.

22.14. The terms "aJJ,>~ "any," and "each" shall each be construed as encompassing any and all.

CORPORATE REPRESENTATIVE TOPICS -h---¥;::J1:1r a~:~tAerity te eeAdt~et bw.;-ifl-ess-HHhe State efTe::as.

2.1. Yeur eerpeFate str~:~et1::1re, iAeht9iRg !:I tit Ret lira:lite84e: The 8\/Aer:-hif.l ef YEH:H'-stee*t Formatted: Indent: Left: 1", No bullets or numbering TAe iE:IeAti:fieatieR efYear 12arent CemfJaRy; ~ The st'r1:1etl:lra! relatieRsRi13 Bet·NeeH Ye~:l aREI Ye1::1r PareAt CeJTifJaAy; 4 ~~;W-eWiH!rshi13 efstee-lc iA £~::~8sir:liaries aRt! Affiliates; e.:- +4e-itleAtitieatie~flG-Af.fi.tiatest f The structural relationship between You and TMX Finance TX and/or TitleMax Formatted: Indent: left: 0.75", No bullets or TXYe~::~rg1:18&iEiiaries and /> ftiliatas.; numbering TAe everla13 ef effieer, Eiireeter,-manage!~ia!-er-etAer eFnpleymeRt pesitioos Fonnatted: Indent: Left: 1", No bullets or -13etweeR-¥-e~-eur PareRt CempatTY; numbering g. aREI fl.:. b....__The overlap of officer, director, managerial or other employment positions Fonnat;ted: Indent: Left: 0.25", No bullets or bet\veen You and TMX Finance TX and/or TitleMax TXYe1:1r £yf:;siEiiaries aAE:l Affiliat.es-. numbering

~l:lr finaneial repertiRg h-1 relatieA te Parent-C-.em))aay-afi-G-'?a~ Affiliates, iAeh:~tling l:n:1t net-+iffi.#eEI-ffi.:. a. The freqHeRey, aat1:1re, aREi eeAteAt efYeur £Td8siE!iaries' aAEI AffiliateHneeme; tanatieA, EJUarterly, aAa aRAual r~ &.--+lie maARer a REI n'letheEI ef pre~aring YeHr Su8d8iaries' aRE! AffiliateHneeme, taxatieR, q1:1arterly, aRE! aARllal rej3Sl1S; e:--¥e1:1r iRvekement iR the 1:3re~aratieR er eversight efYe1:1r S1:1lasiEiiaries' aA€1 Affiliates' iAeeme, tanatieA, f11:1arterl), a REi aRA1:1al repe~nd H. AA) efYeur iReeme, ta:catieA, q!darterly and aAnt~al repert:: tHat is seAselielated v fth that efYeur....&-li=Jsieliaries er Affiliates.

4.-.,. Your board of directors, officers, and managers, including but not limited to: a. The identification of Your directors, officers, and managers;

0701 b. The responsibilities of Your directors, officers, and managers relating to TMX Finance TX and/or TitleMax TX¥e1:1r S!lBsiEliaries aRB A#iliates aREI'er Ysur PareRt CeA1f.laftJ'-; c. The relationship between Your directors, officers, and managers and the directors, officers, and managers ofTMX Finance TX and/or TitleMax TX¥-oof St~8si6iaries aRd Affiliates aREI/er Ye1:1r PareHt CeR1j3aR); d. The date, length, participants, substance and content of any discussions at any of Your board of director meetings regarding any of Your marketing practices with respect, iReh:IEiiRg 8tH Ret limite8 to solicitation of Customers of Competitorse-empeHters' eustemers, buyouts of Customers of CompetitorseeH-tf1etifefs' loans, refinances of Customers of Competitors~eH-ffiffi' loans, and searches of the DMV databases.

~3. The operations ofTitleMax stores in Texas. specificallyRature ef~~l:lf--bi:I-Sffies.s aR6 Baily BfJeratisAs in Te::as, iRei1.1Eling 9Ht Rat JimiteE:I-t-9: a:----¥-el:IT-erera ti an s; l'l. The iEiel'ltifiearieR efYe1:1r 81:1siness l:IRits er-Ge!**ffilea-t-57 e.:--~eAtifieati en efYetn· 81:1siness I;!Rits eHiepa-FtmeA·ts-tfl.at share eJ3efati..aR.s. with Yeur Su6si6iaries aRB Affi.liates er-¥e·.1r Pare11t Ce!'AJ3Bfl)'; 4Q.o,The locations of each TitleMaxef..¥.el:!f stores in Texas; e:-12:.The dates that each TitleMaxef:.¥.oo.f stores in Texas opened and, if applicable, closed; f£,.. The name and number of the district and region in which each TitleMax store is located; g.-d. The annual, quarterly, and monthly performance and profitability of each of Your stores in Texas; lt:--k:leRtitieatieR ef geAeral rRanagers and stare l'llaRagers that were paie:l any f3erfarFBaAee !:lasee:l l?enldses, inc-ltt6iRg 81:1t net limiteel te any "J3reHt hlen1:1s" er ~aR ve!1:1me" hlenHs; f:.L The identification by name, number, and geographical scope of each of Your districts in Texas; .t.-LThe annual, quarterly, and monthly performance and profitability of each of Your districts in Texas; k lBeAtiHeatieA efBistriet rnaRagers tflat were 13ai8 any l'erfermaAee l:lase6 i?e~WSeS; inell:le:ling 9~:t FISt limiteel te any "prefi.t..I:Janu~Aew-1-oan .. OI1:1me" i?an1:1s; I. TAe 6ate(s~ tAat tlistriet iflaAagers v:ere paiS any J3erfenflal'lee Based bsfll:lses, .ffi.€.1..HEling 81:1:t nat liJflitetl te any "13refit i?anl.ls" er "new-+ean "BIHifle" 8a!Tl:J5t mo. The identification by name, number, and geographical scope of each of Your regions in Texas;

0702 tr:-h. The annual, quarterly, and monthly performance and profitability of each of Your regions in Texas; e. lBeRtiHeatieA efregieRalmaRagers tRat wefC J3aiel aAy fleHermaRee Base4 beRuses, iReiHEliRg 13Ht net limite9 teaRy "J3refit beRl:ls" er "Rev: leaH vell:lme" eGJW-5f f3. TRe ElateEs) tRat regieRalmanageFS tRat •vere ~aiEl aRy flerfel'ffiaiWe-9ase4 -i:l€HttJ-se5;-i-Acltt4iAg 9\:lt Ret lin=titeEI te any "Fl~Rl:lS" er "Ae'<'o' leaR Yell:lme" b~ Ef.-¥el::lr setH·ee ef re c'eRl;le eameEI in Te::as, ineiHcliFtg iE:!eRtifieatieA efall fees aR6 ~eiateei witA Yetl-F-teaas iR Tenas; aRe!

r. AAy traele-er busiAess that Yeld-fef.e!T6elegate, er ethet-v-ise stt8tnit te Yeur PareAt ~aAy, Ye1:1r S~:~bsi8iaries er AffiliatE!s, er aRy tHin! tJarty ··eA8eFS.-

&.4. Your corporate policies and procedures with respect to marketing to Customers of Competitors, including but not limited to: a. Your method and manner of developing and adopting Your corporate policies and procedures with respect to marketim! to Customers of Competitors; b. The identification of individuals and entities, including employees ofTMX Finance TX and/or Title Max TX~~J3aA)' an6/er £1::1bsidiaries aAEl Affiliates, involved in the development and/or adoption of Your corporate policies and/or procedures with respect to marketin2. to Customers of Competitors; e:--¥ei:l-f-ffieth-e6 aR8 lEaRRer efEleve!epiRg aA·aa8e~~iAg EBI'f!Bra£e flSiieies aA!:I preeeffilres v·itA Yeetr PareRt CemtJaAy aAEiler 2i1.1l:lsidiarics aRE:! Affiliates; 4£:.Your policies and procedures regarding the use of DMV Databases and DMV Records; e-4.,_Your policies and procedures regarding the development, creation, drafting, review, and approval of marketing materials directed to Customers of Competitors, such as direct marketing mailers and flyers; .f:----¥.e~es aAEl preeeelures regarEiiAg b~;~EigetiAg, e' ·alHatiAg, aAalyi:!:iAg 'f}effenflaRee metries, anEI aOOffing efiEar!i:etiAg 13laRs aAEl/er ~regFams, ~eaf.ieally iAveJniAg 8ireet marlcetiAg with mailers anEl flyers; g:-~ Your policies and procedures relating to the creation, maintenance, and destruction of information in 11 marketing binders" or "buyout binders"; R-:.[_ Your policies and procedures regarding audits of TitleMax¥ffil.F stores and the Hmarketing binders" located in each of the stores; he.. Your policies and procedures regarding buyouts of competitors' loans, marketing practices regarding buyouts of competitors' loans, and solicitation of competitors' customers in order to buyout competitors' loans;

0703 f.-!1..Your policies and procedures regarding refina1~ees af eeffifJet#ef.s.!.-IOOR-5; marketing practices regarding refinances of competitors' loans, and solicitation of Customers ofCompetitorseemretf.t.effi!.~F& in order to refinance competitors' loans; t<.h_ Your policies and procedures regarding the development of marketing practices by regional managers, district managers, store managers, assistant store managers, and customer service representatives; hLThe identity of each of Your employees who was responsible for or involved in the development, implementation, and/or approval of Marketing strategies, such as cold calling or lien searching with respect to marketing to Customers of Competitors; m. TAe iRteraaf.eET-ef...¥.el:!F legal e:le~attntefTI=-aft6--¥e1:!f-ffiar·k-efing-Eiepal1ment reganHng the iF.itiatieR ana Bise-entinl:!atien efmarl:eting £3raetiees, inehH!ing j:'l~es iRvolviRg tAe 6~o~ya~:~ts ef esmf.letiters' leans, refiRaRses ofeemp~ leans, MHI seareAes eftRe QH" 9ata8ases By en'lpleyees er thin:! party ··enders feF-fflaflwting f.Jf::ll'J3SSest n. TAe inEeraaf.en-e.f-¥.e~efltlftme~J3artffient Y e1:1r -P-arent Cempany an Eller Yeur Sl;ll:lsidiarieG and AffH-i-at-es-regaffi.ing tHe initiatie& anE! 8iseentin1.1atien ef marl-eting praeti~es, il=tei~::~EiiAg fii'aetiees in· ·el· ·ing tAe .ffitye1;1ts efeeJFJj3ettters!-+eans, reHnanees efeempetiters Jeans, ane:lsearehc.s-e$ tOO 9?4" ldataBases By empleyees eF4hlfd f18I·£y Vi::F!Eiers fa~ e:.k. The sales or Marketing training or instruction You provided to Your employees and/or the employees ofTMX Finance TX and/or Tit! eM ax. TX with respect to marketing to Customers of Competitors; jt:l,_The compliance or noncompliance of Your employees and/or employees of TitleMax. TX or TitleMax Finance TX with Your policies, rules, and/or codes of conduct related to marketine to Customers of Competitorssa.fe-an4!er-er Mafl~ng efear title leans in the state efTenas; ~Ill. Your policies and procedures regarding "customer tracker[s]" or "marketing trackers"; 1 1':!1:..Your policies and procedures regarding the retention ofphysicalloan or customer files; s. TAe GSlFIJ:JiiaAee e~Hee!'flJ3lianee efYe1:1r en1pleyees and'er eJRflleyees sf +itle~'la:: TX e~ffi-:'14Jul't)G-lk-i~r-ee4es-ef eel'l41:!et relateS te rAe reteAtieA efpRysieal or e!eewe!'lie-deE:a1ments aREl.'er ffifu~

~5. Your policies and procedures relating to information technology, including but not limited to:

See Ryan Dep. 16:7~12; 81:5-11; Sudduth Dep. 67:18-68:5.

0704 a. Your policies and procedures regarding the retention of computer hard drives and the information and documents contained thereon; b. Your policies and procedures regarding the use of computers and laptops that You own, possess, and/or control; and c. Your policies and procedures regarding the maintenance of computers and laptops that You own, possess, and/or control, including but not limited to maintenance of the hardware and software; d. Your policies and procedures regarding the retention and destruction of information contained on computers and laptops that You own, possess, and/or control when an employee discontinues his or her employment with You; e. Your policies and procedures regarding the use of e~mail addresses You provide to Your employees; f. Your policies and procedures regarding the maintenance ofthe accounts and e- mail addresses You provide to Your employees; g. Your policies and procedures regarding the retention and destruction of sent, received, deleted, and draft email correspondence and documents received through the accounts for the e-mail addresses You provide to Your employees; h. Your policies and procedures regarding the termination of access to computers and laptops that You own, possess, and/or control, and to e-mail addresses You provide to Your employees when an employee discontinues his or her employment with You.

g.,.(). Your knowledge of and the actions taken in response to your knowledge of Your employees and/or the employees ofTitleMax TX or TitleMax Finance TX searching DMV Databases (using license plate numbers, lien holder information, or other similar information) for Marketing purposes, including but not limited to: a. The scope of Your knowledge concerning Your employee's or and/or the employees ofTitleMax TX orTitleMax Finance TX's use ofDMV Databases to market to Customers ofCompetitorsfGtential EHstemeFs, including but not limited to the practice of obtaining license plate numbers from vehicles located in Loan Star parking lots and the prevalence of searching DMV Databases by lien holder; b. The date and manner in which You acquired such knowledge; c. Identification by name, title, position, and store of all of Your employees and/or the employees ofTitleMax TX or TitleMax Finance TX that searched the DMV Databases for marketing purposes; d. Identification of by name, title, position, and store of all of Your employees and/or the employees ofTitleMax TX or TitleMax Finance TX that used the results of the searches of the DMV Databases for marketing purposes, including but not limited to the identification of all employees that sent Marketing materials to the individuals on the Overlap List;

0705 e. Your reimbursement or denial of reimbursement requests for expenses incurred by Your employees and/or the employees ofTitleMax TX or TitleMax Finance TX for therelatiAg te use of the DMV Databases, iAeil:lEliAg 9Ht-A-e~9-te aeeess fees, late fees, priRtiAg fues,ref'art fees, aAEl pestage fer t'Aailing leH~r flyers te pFespeetive e1:1stemers; · f. The actions taken, if any, in response to acquiring such knowledge· and the identification by name, title, position, and store of all of Your employees and/or the employees ofTitleMax TX or TitleMax Finance TX involved in carrying out those actions; g. T!ie enisteA.ee-a~entifieatiea sfaAy efYeHf-tteeel:!Ris with DM¥-Qata\3as-es, iAel1:.18iRg l:l1:.1t Ae~tl te aAy agreemeAts 8etweeA Ye1:1 aAel the DM" DataBases; aA8 h. T!ie enistenee-afHI-teeAtifisatieA efaRy aeee1:.1Ats efefYe1:.1T-efRpleyees aAEI/ef-tfl.e- ernp·leyees·eH#l~1a:: TX er Title~1a:: fiRaRee TX v·ith Q..t>1'' Datal:lases, iRel1:18iHg 8t:lt net limite8 teaRy agreeAteAts BetweeR Yel:lF etnj3leyees aRElter tHe ~es afTitleM<P.H"~l'itleMa·x-l"inanee-'r-X,-e~<i-llle D~4" DataBases, eR the etheF AaAEI .

.9.:---¥ewr eff:'eJ:ts te iHYestigate tAe eet'l~Efleee:i iR tHe !' 1 sveH'!Ber 13, 2912\etter frem JeRH ~1 eCleskey ef Selee+-tvtaAaget'AeRt Rese1:1rees, LLC, te ''iR Then'las efT~ lX FinaRee, LLC (tRe "Cease aRB Desist Letter''), aA8 attaeheellierete as Exhil:lff...A.., ineh.teling 9Ht net Iil=niteEl te: a. The Elates eftRe eaeh iR«estigatie~r, 8. IEientifie:atiaA-£tf.¥.el:lr Jireeters, el¥ieers, tF!aAageFS, regienal rnal'lagers, Elistriet ~Refill t'AaRagers, stare maAagers, assi:itaAt stare maAagers, el::lstemer ser-'.4€-e-Fef!reseAtati··e, er emf~leyees iRvelvea e~i]3atiAg iR BA)' s~;~eh ~ e. IA8ivicluals witH whem.Yet~r elireeters, effieers, maaagei'S;-regH;ma~-rnana-geFS, Elistriet l'AaRagers, geAeralmaRagers, slere maAagers, assistaRt stare maRager::, el:lstemeF servie:e represeRtative, er eFl'lpleyees eeffimHRieate8 in the seurse efaAy StiER iAYCStigetieA; &.--.ffiterfml e:lise1:1ssieRs fay aRB Bet"'rJeR aAy sf Yet:W-4it:eeters, effieers, ITJaRag~ ~ea! tF.aRagers, 8isr:riet manageFS, general FRaAagers, stare tTJaAagers, assistaHt stare IHanagers, Gl:lstamer service refJFCsentati· ·e, er en1plsyees;:clating te any sl::leh itwestigat+eRt e. faet-s t:!isc~8-6t!·ring any sr~eA investigatieA that Stlj:)~ert er unEiermine in any way the elaims made l:Jy !ahA HeC!esl:ey in tl\e Cease ane:l Qesist beuer; aAEI J:. All esmH'I!:IAieatiens ·rith Yertr Srtl:Js-i€iaries er Affiliates, anEI.'er et'AfJieyees relatiAg te eras a res='ilt efany s~:~eA il'l\~estigatien, inel~;:~ding "reminEI(ing] all Te::as tHaRagers" ef Y e1::1r f!est#eA-en tAe pFaetiees Elesefi8e8 iR tHe Cease aRd

0706 Desist Letter, as set ferth iR tRe DeeemBer 8, 2Gl2 letter fren'l "iR Then'las ef T~ 4X FiAaAee, bbG-.te-J-ehn ~4eClesl::e;· ef £elest ~4aAagemrffit-R.e.s.eHrees, bbC.

IQ. All fiAaAeial iAfenHatieR esAeemiAg eash sf Yel-:lr !eaRs eA the 0"erla)3 bist frem the date-each !oaR vas erigiAateEI te tHe J3FeSeRt, iAei~:~Eiing lmt net limiteEI to: a-:-¥-el-:lr re··eA~;~e (iR 9ellars) fer each efYel:H'ieans SA the O"erlaJ3 List; ---J Formatted !:r.-¥e~eRses (iA ElellaFS) fer eaeb efYel-:lr IeaRs eR the OverlaJ3 bist; e:-¥e1:1r ~eta! grass reveAHe aRt! Ret j3refit (iA ele!lars) fer all efYeHr !eaRs SA tHe Overlaj3 List freA'l the earliest Elate tAat a lean SA the Qyerlap list ·11as erigiAate8 te the )3rese:H+ ~eAtifieaFieA ef all Bee1:1meRts er rep arts iR "sur pessessieA, e~:~ste8y, er eeHtrel---j rormatted:Justified, Tab stops: oH, Left e<'iE:IefH:iHg er refle:tiHg that Ye1:1 8isb1:1rseE:I f~;~R8s er issueS cAeel:s te 13ay eff aRy ef PlaiAtiffs' leaR v·heA-¥el:I-GrigiFJateel cael:! efYeur !eaRs SR tRe OverlaJ3 bist; e. The 6isi:'JwrsemeRt sf fHABs er issHaAee ef eheehs te pay eff PlaiRtiffs' leans fer eaeA ef the IeaRs entRe Overla~ f.----M.eRthly er ether reJ3erts Bise!esiAg the 10 8h:lme (i.e., the total number) ef Re"' leatrS-aA-4 I·ef.iAaflees fer eaeh efYe~ ~7. THe RHmBer aREI/er Bellar aiHSHttt-ef-menthty-safe.s...:fur-eaefl-ef Yeur stares eR tRe O··erlaJ3 bist; h. Ref3erts raRhiRg emf3leyees By "Aer lee~A "elume" er "sales" fer e~ll eftfle ~~immc-e-T-X-steres-appeariAg eR tHe O··erlap List;* h---¥eur meFJthly · ·ehnne (i.e., the tetal RHmi:ler) ef nev,r leans anS refiFJaFJ€-eS-f.er-ea;;l.} ef the TitleMa:: TX er TMX 'fiAaRee TX stares SA the QuerlatJ List.

++._s._ _ Your involvement in l~itigation in the state ofTexas, including but not limited to: a. Identification of 1Jitigation currently pending in the state or federal courts located in Texas in which You are a named party; b. T.he causes of action in the ~litigation currently pending in the state or federal courts located in Texas in which You are a named party; c. The current status of the 1Jitigation currently pending in the state or federal courts located in Texas in which You are a named party; d. Identification of 1Jitigation filed or pending in the state or federal courts located in Texas in the last five (5) years in which You were a named party; e. The causes of action in the .!iitigation filed or pending in the state or federal courts located in Texas in the last five (5) years in which You were a named party; and

0707 f. The status of the 1Jitigation filed or pending in the state or federal courts located in Texas in the last five (5) years in which You were a named party.

12. The iEieRtifieatiel1 ef~Re eRtity 1~ayi11g legal Bills asseeii:'.teEI...-itA the al:reve eaptie&e4 tiH.ga#eR, aREI the se1:1ree eftRe RmEis 1:1see te pay S!:ldt legal Sills.

0708 EXHIBITD

0709 1 NO. 2013-33584 i1ELLSHIRE FINANCIAL SERVICES, * IN THE DISTRIC'l' COURT f.1LC, d/b/a LOANS TAR TIT.LE * LOANS and INTEGRITY TEXAS * FUNDING, LP * 4 * vs. ' HARRIS COUN'rY, 'fEXAS 'J.'l,JX FINANCE HOLDINGS, INC.; 'l'MX FINANCE, LLC; TMX FINANCE * OF TEXAS, INC.; TITLEMAX OF •k 'fEXAS, INC.; FELIX DELEON; AND ISHMAEL HERNANDEZ '' 152ND JUDICIAL DISTRICT 10 ******************************************* 11 ORAJ" AND VIDEOTAPED DEPOSITION OF 12 JANES AR'l'HUR GRI F'F'IN 13 HAY 23, 2014 14 VOI.lJl'1E 1 15 ************************t**************ktw* 16 ORAL AND VIDEOTAPED DEPOSITION OF JAMES ·1 7 i\RTHUR GRIFFIN, produced as a witness at 'che instance of the Plaintiffs and duly sv1orn, was taken in the above-styled and numbered cause on the 23rd day of Hay, 2014, from 9:08a.m. to 2:09p.m., before Marsha Evans, Certified Shorthand Reporter in and for the State of •rex as, reported by machine shorthand, at 600 Congress Avenue, 20th Floor, Austin, Texas, pursuant to the '!'exas Rules of C.i.v:L.l. ProcedUJ:e and the provisions stated on the record or attached hereto.

0710 Page 10 1 Q. What did you discuss?

2 A. What I thought this was all about.

3 Q. And what did you think this was about?

4 A. Aggressive marketing tactics.

5 Q. What other discussions did you have with your 6 family?

7 A. That's it. Just the fact that I had to come 8 down and talk about aggressive marketing tactics.

9 Q. Who in your family was present for that 10 conversation?

11 A. My wife and my middle daughter.

12 Q. And what are their names?

13 A. Cathy, with a C, Griffin.

14 Q. And your daughter's name?

15 A. Devin Montiel, M-o-n-t-i-e-1.

16 Q. You had mentioned that you spoke with your 17. family about aggressive marketing tactics. What did 18 you mean by that?

19 A. Because I sa1v the name LoanS tar on the -- on 20 the paperwork, I assumed that we were going to talk 21 about PublicData.com and targeting their specific 22 customers.

23 Q. And why did you make that assumption?

24 A. We had been using PublicData.com for I'm going 25 to guess a year or so, and then we had been asked to Veritext Florida Reporting Co. 800-726-7007 305-376-8800

0711 Page 11 1 not do that anymore, and rumor had it it was because 2 LoanStar was upset with us for doing that ..

3 Q. When you say ''we,• who are you referring to?

4 A. TitleMax stores in general.

5 Q. All the stores in Texas?

6 A. I don't know about all the stores in Texas.

7 MR. GANNAWAY: Object to form. I'm 8 sorry.

9 THE WITNESS: I'm not sure that all the 10 stores in Texas were using it, but it was a -- it was a 11 directive that was given to stores and a tool that was 12 out there.

13 Q. (By Ms. Goebelsmann) Which stores was that 14 directive given to?

15 MR. GANNAWAY: Object to form.

16 THE WITNESS: For sure the stores in 17 Austin. It 1vas a -- it was used some when I was in 18 training in the Dallas/Fort Worth area, as well.

19 Q. (By Ms. Goebelsmann) You had indicated that 20 PublicData had been used for one year. When did it 21 start to be used?

22 MR. GANNAWAY: Object to form.

23 THE WITNESS: I don't know when it 24 started. I interviewed Hi th the company in late 25 September, early October of 2011, and I asked Veritext Florida Reporting Co. 800-726-7007 305-376-8800

0712 Page 12 1 specifically about marketing plans, and I was told then 2 during the interview process that we had access to a 3 program that would tell us if a customer had a loan 4 somewhere else and we could then target that customer, 5 so I know it was at least in use or known of at that 6 time.

7 Q. (By Ms. Goebelsmann) Who did you speak with 8 that told you this?

9 A. Harold Landers.

10 Q. Who is Harold Landers?

11 A. He was a regional manager at the time.

12 Q. Regional manager where?

13 A. For TitleMax.

14 Q. Was he in a particular district or region?

15 A. Texas. I don't -- I don't remember how the 16 entire Texas market broke out, but he was DFW and 17 Austin for sure.

18 Q. Was there anyone else present for this 19 conversation?

20 A. There was not.

21 Q. When did you start using PublicData?

22 A. I'm going to guess March or April of 2012.

23 Q. When did you stop using Pub1icData?

24 A. February, late February, early March of 2013.

25 Q. Why did you stop using PublicData?

Veritext Florida Reporting Co. 800-726-7007 305-376-8800

0713 Page 13 1 A. I left the company. Can I elaborate on that?

2 Q. Yes.

3 MR. GANNAWAY: Object to form.

4 THE WITNESS: The last two months or so, 5 two or three months, it was not used for targeting 6 specifically LoanStar customers. PublicData.com, if 7 you're not familiar with it, allows you to key in a 8 license plate number, and it will tell you if anyone 9 has a lien on their vehicle. So I would ride through 10 parking lots and jot down license plate numbers in 11 places that those types of customers might frequent, 12 just to have some type of database to work off of.

13 MR. GANNAWAY: I ' l l object to 14 responsiveness.

15 Q. (By Ms. Goebelsmann) Did anyone tell you to 16 stop using PublicData?

17 A. For targeting LoanStar customers, yes.

18 Q. Who told you that?

19 A. That I believe came out in an e-mail from our 20 district manager, Patrick Sudduth.

21 Q. When did he tell you that?

22 A. I'm going to guess November, December 2012.

23 Q. Do you have a copy of that e-mail with you?

24 A. I do not.

25 Q. Do you have a copy of that e-mail in your Veri text Florida Reporting Co. 800-726-7007 305-376-8800

0714 Page 48 1 A. Mayumi, who I'm still friends with, shared 2 with me that she had an attractive assistant manager 3 that worked for her and she felt like Gary was flirting 4 and hitting on not only her, but the other ladies that 5 worked for -- that worked for him.

6 Q. Who was the assistant manager who worked with 7 Mayumi?

8 A. I don't remember her name.

9 Q. When you were working with TitleMax, how often 10 did you communicate loJi th your supervisors?

11 A. Daily for the most part.

12 Q. And how would you communicate?

13 A. It's probably 50/50 split between e-mail and 14 telephone.

15 Q. Did you send e-mails to Andy H?

16 A. When I was in training in Arlington I would 17 have sent e-mails to him, yes.

18 Q. Would you have asked questions about marketing 19 practices?

20 A. We would have reviewed marketing practices.

21 At the time I was so new that I don't know that I would 22 have been in a position to ask good, intelligent 23 questions about marketing.

24 Q. Did you send e-mails to Gary Jackson?

25 A. Absolutely.

Veri text Florida Reporting Co. 800-726-7007 305-376-8800

0715 Page 49 1 Q. Did you send him e-mails regarding marketing 2 practices?

3 A. Sure.

4 Q. Did you send any e-mails to him regarding 5 PublicData?

6 A. I'm sure that information would have been in 7 my marketing practices. I don't recall sending an 8 e-mail to him just about PublicData. · 9 Q. What do you mean that information would have 10 been in your marketing practices?

11 A. We had to break down by day Nhat our marketing 12 plan was and PublicData Nas a Nas a big part of our 13 marketing plan.

14 Q. When you say you have a breakdown by day, what 15 is that?

16 A. Monday through Saturday. We were expected to 17 market 'six days a week, and Ne had to explain on what 18 day and approximately Nhat time and for how long we 19 were going to do what activities.

20 Q. Was this a written schedule?

21 A. It was a written plan. Business oftentimes 22 dictated how closely you stuck to that, but it was a 23 it was an estimate on what your next week's marketing 24 practices would be.

25 Q. Did you share this with your district manager?

Veritext Florida Reporting Co. 800-726-7007 305-376-8800

0716 Page 88 1 kind of a novelty to be able to get into PublicData and 2 use it for the first time.

3 Q. Why was it a novelty?

4 A. At the time it seemed like an easy way to 5 start generating a lot of business.

6 Q. What did Harold Landers tell you about 7 PublicData during your interview in November 2011?

8 A. He did not call it PublicData. I asked about 9 marketing plans and how stores would market their 10 business, and he said that we now have the capability 11 of going into a program, typing in a license plate 12 number, and it will tell us if a person has a loan and 13 at what competitor and we can go -- in his words, 11e 14 can actually go knock on the customer's door and talk 15 to them about our services. I didn't feel comfortable 16 doing that, so I did the mailers.

17 MR. GANNAWAY: Object to responsiveness.

18 Q. (By Ms. Goebelsmann) I may have misstated 19 earlier. When did you have your conversation with 20 Harold Landers?

21 A. Late September, early October.

22 Q. So this conversation you just conveyed was in 23 late September 2011?

24 A. Or early October, correct.

25 Q. Did you speak with Harold again about Veritext Florida Reporting Co. 800-726-7007 305-376-8800

0717 Page 89 1 PublicData or using the license plate information in 2 the manner that he had described?

3 A. Not directly, no. 4 Q. Did you ask anyone about it during your 5 training period?

6 A. I did.

7 Q. Who did you ask?

8 A. Gary Jackson at the time was my training GM, 9 and again, I did not know the name of the other 10 website, but I just -- I mentioned to him that Harold 11 had brought this up, and he said, yes, that's something 12 that some guys are using.

13 Q. Did he indicate to you lvho was using it?

14 A. He did not.

15 Q. Do you know what areas the PublicData database 16 was being used in?

17 MR. GANNAWAY: Object to form.

18 THE WITNESS: Not for sure.

19 Q. (By Ms. Goebelsmann) Where did you believe it 20 was being used?

21 MR. GANNAWAY: Object to form.

22 THE WITNESS: The Dallas/Fort Worth area.

23 Q. (By Ms. Goebelsmann) And why did you believe 24 that?

25 A. Because in asking Gary about it he had Veritext Florida Reporting Co. 800-726-7007 305-376-8800

0718 No. 2013-33584 District Court of Harris County, Texas 152"d District Wellshire Financial Services, LLC dba Loanstar Title Loans and Integrity Texas Funding, LP Vs. TMX Finance Holdings, Inc., TMX Finance LLC; TMX Finance ofTexas Inc.; Titlemax ofTexas, Inc.

Excerpts from the ROUGH TRANSCRIPT OF THE DEPOSITION OF RANDY RAINEY July 8, 2014 at 9am Christina Goebelsmann, Wargo French LLP for Plaintiffs Bryon Rice, Beck Redden for Defendants

0719 RAINEY- DRAFT ONLY Page 36 NOT FOR OFFICIAL USE

2 A. Yes.

3 Q. Okay. And did you ever hear of a technique of writing down license plate numbers in parking lots?

5 A. Yes.

6 Q. And who did you hear that from?

7 A. Tom Griffin.

8 Q, And when did you hear that?

9 A. Within a week or so after being hired.

10 Q. So did Tom tell you about the writing down of license plate numbers as part of your training?

12 MR. RICE: Objection, form.

13 A. He stated that this was something he was doing, and I actually went with him several times to do it at a couple of different locations. So I actually- he actually showed me how to do that.

17 Q. And where did you go on those several times that you accompanied him?

19 A. There was-- We went probably two times-- maybe three, but I think at least two times to a competitor that's on Forest Lane and Central Expressway, and that's the-- that's Texas Title, like red and yellow. It's really close to where I live. I live on the other side of the freeway.

25 And another place, I believe it's on

0720 RAINEY- DRAFT ONLY Page 37 NOT FOR OFFICIAL USE

1 Buckingham and Belt line, same company.

2 And another place on Central Expressway somewhere between-- it's on the west side of Central Expressway, somewhere between, like, Spring Valley and Alpha, somewhere in-- somewhere around there, within a mile or half mile. And it was, like, a little odd-- very odd little mom-and-pop kind of place. It was, like, in a weird little office at the end of, like, a motel. I don't know the name of that place.

10 Q, Was that an auto title loan company?

11 A. I don't know everything-- They did auto loans, the title loans, but I-- they may have had other loan services as well. I'm not sure.

14 Q. Were there any other places that you accompanied Tom where you would be writing down license plate numbers?

17 A. If there is, I don't recall. Just those the three that I recall.

19 Q. Okay. And those three times you accompanied him, during what month and year did that occur?

21 A. It would have been within the couple weeks after I was- within a week to two weeks after I was hired; and I would say somewhere between the second and fourth, fifth week -- 25 Q. Okay. You-- 0721 No. 2013-33584 District Court of Harris County, Texas 152"d District Wellshire Financial Services, LLC dba Loanstar Title Loans and Integrity Texas Funding, LP Vs. TMX Finance Holdings, Inc., TMX Finance LLC; TMX Finance of Texas Inc.; Titlemax of Texas, Inc.

Excerpts from the ROUGH TRANSCRIPT OF THE DEPOSITION OF MIGUEL MARTINEZ July 8, 2014 at 2pm Christina Goebelsmann, Wargo French LLP for Plaintiffs Bryon Rice, Beck Redden for Defendants

0722 MARTINEZ- DRAFT ONLY Page 33 NOT FOR OFFICIAL USE searches?

2 A. No. Q. Do you remember who first told you about the PublicData searches?

5 A. There was a guy named Ray. He told Wendy and Wendy told me. And then it was discussed at-- on one of our conferences-- on one of our conference calls, and I know-- I know at least Andy was aware of it.

9 Q. So you discussed the PubllcData searches with Wendy and the other-- 11 A. Yeah. She's the one that told me that that's what she was going to start doing, and that I should start doing it over at-- at the other North Richland Hills location.

15 Q. So to make sure that I have this clear: You first learned about the PublicData searches from Wendy?

18 A. Um-hmm.

19 MR. RICE: Objection, form.

20 A. Yes.

21 Q. (BY MS. GOEBELSMANN) And when did you have that conversation with Wendy?

23 A. When I was there training.

24 Q. And Wendy was your trainer?

25 A. Well, yeah, for the Texas-- I guess kind of

0723 MARTINEZ- DRAFT ONLY Page 34 NOT FOR OFFICIAL USE

1 just getting me introduced to how to do loans in Texas, so for those couple weeks. So basically I got there and the first thing they did was make me go out and market for Wendy. So I was outthere marketing.

5 And then we were discussing my move to the new store when-- you know, when I was going to be taking over that, and she was telling me that, "Hey, this is what Ray in Euless is doing."

9 Q. Okay. So you first learned about PublicData when you were working with Wendy in or about August or September 2011-- 12 A. Yes.

13 Q. --is that right?

14 MR. RICE: Objection, form.

15 Q. [BY MS. GOEBELSMANN) And had Wendy been using the PublicData searches prior to that point In time?

17 MR. RICE: Objection, form.

18 A. No. She wasn't using it through her computer.

19 She was actually getting-- She would call Ray and Ray would pull up the information for her, because Ray's the one that had, I guess, the access to that PublicData.

22 Q. [BY MS. GOEBELSMANN) Okay. How long had Wendy been receiving search results from Ray, to your knowledge?

25 MR. RICE: Objection, form.

0724 No, 2013-33584 District Court of Harris County, Texas 152"d District We !Ish ire Financial Services, LLC dba Loan star Title Loans and Integrity Texas Funding, LP Vs. TMX Finance Holdings, Inc., TMX Finance LLC; TMX Finance of Texas Inc.; Titlemax of Texas, Inc.

Excerpts from the ROUGH TRANSCRIPT OF THE DEPOSITION OF ANTONIO AMADO July 9, 2014 at 8am Sarah Powers, Wargo French LLP for Plaintiffs Bryon Rice, Beck Redden for Defendants

0725 A. Before I had started, there is a general manager, Denny, I think his first name was. I don't recall his last name. I was told that he had done that.

5 Q. Okay. What store was Denny at, if you recall?

A. He was on the store on North -- Northwest Military, just up the road from here.

Q. Do you know what number that is?

A. Not off the top of my head, I'm sorry. I want to say 5, maybe SA-5, SA--- SA-5- perhaps SA-5. I know SA-l is on San Pedro. SA-7 was on Blanco, and that was not in our district under Bill Kretschmer. That was under Eric Bullis. He was our district manager, different district.

15 Q. From-- from whom did you hear that Denny was using the practice of locating lie--- or using license plate numbers to locate customers?

A. CSRs, CSRs that had worked in different stores that had known him, that had been through my store. I'm trying to remember their names. And the reason that came up is the company had sent out-- I was no longer at SA-18. I was then promoted to Castle Hills 1, which is in a different district, here on Blanco. And the company had sent out an e-mail, a company-wide e-mail, advising of litigation between Integrity and Title Max. So there was

0726 employees collecting license plate numbers to locate prospective customers by employees at the Wind crest store?

MR. RICE; Objection. Form.

5 THE WITNESS; Wind crest store, no, ma'am.

BY MS. POWERS: Q. Okay. And what about the Stone Oak store?

MR. RICE; Objection. Form.

THE WITNESS; Stone Oak, I'm trying·· no, ma'am.

BY MS. POWERS; Q. And what-- what store is San Antonio 3, if you recall?

MR. RICE: Objection. Form.

15 THE WITNESS; I believe SA-3 is Stone Oak, if I'm not mistaken.

BY MS. POWERS: Q. Other than Denny, did you ever hear of any TitleMax employee using license plate numbers to locate prospective customers?

MR. RICE; Objection. Form.

THE WITNESS; Yes. Brigitte. Brigitte, but I don't know-· I don't remember her last name either, and she was at the store on 281 and Blanco. And we had heard that from her store manager, Nick, but I don't know Nick's

0727 Page 1 1 NO. 2013-33584 2 WELLSHIRE FINANCIAL SERVICES, * IN THE DISTRICT COURT LLC, d/b/a LOANSTAR TITLE * 3 LOANS and INTEGRITY TEXAS * FUNDING, LP * 4 * vs. * HARRIS COUNTY, TEXAS 5 * TMX FINANCE HOLDINGS, INC.; * 6 TMX FINANCE, LLC; TMX FINANCE * OF TEXAS, INC.; TITLEMAX OF * 7 TEXAS, INC.; FELIX DELEON; * .AND ISHMAEL HERNANDEZ * l52ND JUDICIAL DISTRICT 10 ******************************************* 11 ORAL AND VIDEOTAPED DEPOSITION OF 12 JAMES ARTHUR GRIFFIN 13 MAY 23, 2014 14 VOLUME 1 15 ******************************************* 16 ORAL AND VIDEOTAPED DEPOSITION OF JAMES 17 ARTHUR GRIFFIN, produced as a witness at the instance 18 of the Plaintiffs and duly sworn, was taken in the 19 above-styled and numbered cause on the 23rd day of May, 20 2014, from 9:08a.m. to 2:09p.m., before Marsha Evans, 21 Certified Shorthand Reporter in and for the State of 22 Texas, reported by machine shorthand, at 600 Congress 23 Avenue, 20th Floor, Austin, Texas, pursuant to the 24 Texas Rules of Civil Procedure and the provisions 25 stated on the record or attached hereto.

Veritext Florida Reporting Co. 800-726-7007 305-376-8800

0728 Page 100 1 which has a Bates number at the bottom of TMX 001338, 2 the bottom two-thirds of that page appears to be an 3 e-mail from Patrick Sudduth, correct?

4 MR. GANNAWAY: Object to form.

5 THE WITNESS: No. I'm on the second 6 page. The bottom two-thirds appears to be an e-mail 7 sent from Todd to Patrick.

8. Q. (By Ms. Goebelsmann) I'm sorry. You appear 9 to be correct. So the bottom two-thirds of this page 10 is dated September 15, 2012, at 1:33 p.m. from 11 TMX-Austin-TX20, correct?

12 A. Correct.

13 Q. And who is TMX-Austin-TX20?

14 A. The store on South Lamar.

15 Q. And you mentioned Todd. Who is Todd?

16 A. Todd is another general manager that I bounced 17 ideas off of, marketing ideas.

18 Q. Can you please read the text of Todd's e-mail 19 into the record?

20 A. "I created a database using the data that we 21 got from PublicData. com" -- 22 THE REPORTER: Could you read a little 23 slower, please?

24 THE WITNESS: "I created a database using 25 the data that we got from PublicData.com using the Veritext Florida Reporting Co. 800-726-7007 305-376-8800

0729 Page 101 1 license plates from cars parked at our competition, 2 Texas Title next door. I have about 20 names and 3 addresses in that database, and all have liens on their 4 titles according to PublicData. I then created this 5 form letter and used mail merge to merge in the names 6 and addresses information from the Excel database to 7 personalize the letter. I'm mailing them out today.

8 Todd."

9 Q. (By Ms. Goebelsmann) The e-mail directly 10 above that towards the middle of the page is from 11 Patrick Sudduth, correct?

12 A. Correct.

13 Q. And it appears to be a response to 14 TMX-Austin-TX20, correct?

15 A. It is.

16 Q. Can you please read what that e-mail states?

17 A. "Good idea. Do you mind sharing this with 18 everybody?"

19 Q. If you turn back to the first page of 20 Exhibit 3, all the way at the bottom there's a date 21 line of September 15, 2012, at 1:40 p.m. Can you 22 please read what that e-mail states?

23 A. "Patrick asked me to share this idea with 24 everyone." Smiley face. "Feel free to call me if you 25 have questions on how to set it up. Todd.''

Veritext Florida Reporting Co. 800-726-7007 305-376-8800

0730 Page 102 1 Q. And immediately above that there is an e-mail 2 from Patrick Sudduth dated September 15, 2012, at 3 1:42 p.m. Can you please read into the record what· 4 that response states?

5 A. "Call Todd. There is no reason not to do 6 this."

7 Q. And then finally at the top of the page is an 8 e-mail from TMX-Austin-TX13. Was that you?

9 A. It was.

10 Q. What did your e-mail say?

11 A. "Same thing here. We had our first buyout 12 from this last month. We continue to work our 13 competitors' parking lots, and on single coverage days 14 we check license plates of cars that come into our 15 parking lot."

16 Q. What did you mean when you said, "Same thing l7 here"?

18 A. That we are using PublicData.com to generate a 19 mailing list based upon license plate numbers that we 20 get from our competition.

21 Q. So you were doing the same thing that Todd 22 indicated that he was doing at the bottom of page 2 of 23 Exhibit 3?

24 A. Correct.

25 Q. And that involved the use of PublicData, Veritext Florida Reporting Co. 800-726-7007 305-376-8800

0731 Page 103 1 correct?

2 A. Correct.

3 Q. Collecting license plate information from cars 4 parked in the lots of competitors?

5 A. Correct.

6 Q. Creating a database of information based upon 7 those license plates?

8 A. Correct.

9 Q. Sending letters to customers?

10 A. Correct.

11 Q. Using mail merge to send those letters?

12 A. I did not use mail merge.

13 Q. How did you send letters?

14 A. On the last page is an example of a -- an 15 insert that I created, and as I put in the data I would 16 put checkmarks, yes for instant approval; yes for no 17 credit check; yes, you get your money in 30 minutes or 18 less; yes, you can get money for car repairs, rent, 19 vacation, or cash for peace of mind.

20 Q. So page 4 of this exhibit is a mailer that you 21 had created?

22 A. Yes.

23 Q. And that mailer was attached to your e-mail 24 dated September 15, 2012?

25 A. Yes.

Veritext Florida Reporting Co. 800-726-7007 305-376-8800

0732 Page 105 1 A. Well, I would print out a screen shot from 2 PublicData anytime I got one that had a competitor's 3 lien information on it. So I would -- if it was Jim 4 Griffin, it would be Jim Griffin. It was addressed 5 specifically to that person at that address.

6 Q. When did you start collecting license plate 7 information from cars parked in competitors' parking 8 lots?

9 A. As early as February of 2012 when I was 10 working at Austin 5 through Annette Martinez's account.

11 Q. How did you get the idea to obtain information 12 using the license plates in competitors' parking lots?

13 A. This was, again, an idea that was brought up 14 in an interview that I had with Harold Landers as early 15 as September, October 2011.

16 Q. Why did you wait until February 2012 to start 17 using that practice?

18 A. That was the first time that the actual nuts 19 and bolts of the practice had been explained to us. As 20 I mentioned earlier, Harold didn't even give me the 21 name of the website that they were using. He just 22 walked me through how they were kind of using this 23 website to get competitors' information. When I asked 24 Gary about it he said yes, he was aware of it, but he 25 wasn't using it, but he knew of other guys in the Veritext Florida Reporting Co. 800-726-7007 305-376-8800

0733 Page 106 1 district that were.

2 So finally in roughly February -- 3 January, February of 2012 the information was shared 4 with Annette who then shared it with us and that -- 5 Q. How did you know the information was shared 6 with Annette?

7 A. There was a visit that day. As I remember it, 8 it was Gary Jackson and Harold Landers, and they had 9 encouraged her to sign up for a PublicData.com account.

10 Q. Were you present for that visit?

11 A. I was in the store, but I was not part of the 12 conversation.

13 Q. Did you hear the conversation?

14 A. I did not.

15 Q. How did you know what happened during the 16 conversation?

17 A. Annette recapped it once the -- once everyone 18 left.

19 Q. When did you first hear the name PublicData?

20 A. I'm thinking it was that same conversation.

21 Q. And why do you think that?

22 A. Again, Harold couldn't even articulate the 23 name of the 1-1ebsite, and when I brought it up to Gary 24 because I had not yet heard the name of the website, I 25 couldn't tell him what it was either. I just explained Veritcxt Florida Reporting Co. 800-726-7007 305-376-8800

0734 Page 107 1 to him what I had been told by Harold, and he said yes, 2 some people are using it, but it was not being used 3 there by him.

4 Q. When Annette recapped the conversation that 5 she had with Harold and Gary, what did she tell you?

6 A. There's a lot of excitement in her voice.

7 Again, we felt like it was a -- it was going to be an 8 easy way to start driving a lot of business, and she 9 said, hey, this is what everyone's been talking about.

10 It's Pub1icData.com. You sign up for an account, and 11 you can key in license plate numbers and you'll get 12 lien information. And she signed up for the account 13 right there. I mean, we did it in the store looking 14 over her shoulder just to see how it was going to work.

15 Q. When you said "we did" -- 16 MR. GANNAWAY: Object to responsiveness.

17 I'm sorry.

18 Q. (By Ms. Goebelsmann) When you said "we did it 19 in the store looking over her shoulder,'' who is the 20 "we"?

21 A. I believe Paul Walton was part of that 22 conversation, as well, or part of that group.

23 Q. Were Harold or Gary present?

24 A. Not at the time I don't believe they were, no. 25 Q. Did Annette report back to Harold and Gary Veritext Florida Reporting Co. 800-726-7007 305-376-8800

0735 Page 1 CAUSE NO. 2013-33584 WELLSHIRE FINANCIAL * IN THE DISTRICT COURT SERVICES, LLC, d/b/a LONESTAR TITLE LOANS and * INTEGRITY TEXAS FUNDING, * LP, * * Plaintiffs * * * vs. * HARRIS COUNTY, TEXAS TMX FINANCE HOLDINGS, ** INC . ; TMX FINANCE , LLC ; * TMX FINANCE OF TEXAS, * INC.; TITLEMAX OF TEXAS, * INC.; FELIX DeLEON; and * ISHMAEL HERNANDEZ, * * Defendants * 152ND .:JUDICIAL DISTRICT ******************************************************** ORAL AND VIDEOTAPED DEPOSITION OF RICHARD TODD HALE MAY 15, 2014 ******************************************************** ORAL AND VIDEOTAPED DEPOSITION OF RICHARD TODD BALE, produced as a witness at the instance of the PLAINTIFFS, and duly sworn, was taken in the above-styled and numbered cause on the 15th of MAY, 2014 from 9:06 a.m. to 2:50p.m., before MELISSA PARKHILL, CSR, in and for the State of Texas, reported by computer-assisted machine shorthand, at the law offices of Sutherland Asbill & Brennan, 600 Congress Avenue, Suite 2000, Austin, Travis

0736 Page 121 l A. No, ma'am. I took that form of letter and customized i t as I was instructed to do with my store's contact information. But I did not create the original letter.

5 Q. Do you know who did create it?

6 A. No, rna' am.

7 Q. When you say you took i t and customized it as a you were instructed to do, who gave i t to you and instructed you to customize it?

10 A. I -- I don't remember exactly. I really don't.

11 I mean, i t came from-- I don't even remember if it came from one of the general managers or if Patrick gave it to me. But somehow I got a copy of one of the letters that one of the other stores was using, and Patrick instructed me to customize i t with my store's information.

16 Q. Okay. You don't know who gave the letter to you, but Patrick was the one who instructed you to customize it; is that correct?

19 A. Well, yes. And not only that -- I'm just -- again, to clarify it, Patrick was the one that instructed me to do all this stuff as is evident by all of the other documents.

23 MR. GANNAWAY: Object as nonresponsive.

24 (Brief interruption.)

25 MR. GANNAWAY: Oh, I'm sorry. Thank you.

0737 Page 122 1 Q. And so Patrick approved of the use of this letter, correct?

3 A. Oh, absolutely.

4 MR. GANNAWAY: Object to the form; leading.

6 Please repeat your answer.

7 A. Yes, he did.

8 Q. Okay. And turning back to the very first page of this exhibit marked 1337 at the bottom, in fact, Patrick Sudduth forwarded this plan to all of the Austin stores; correct?

12 A. Yes, ma'am. And I would clarify again reading through the e-mail, he specifically says, "Call Todd.

14 There is no reason not to do this."

15 MR. GANNAWAY: Object as nonresponsive.

16 Q. And when he says there is no reason not to do this, the this was canvassing parking lots to obtain license plate numbers of competitors' customers and then looking up their D.M.V. information in order to market it them?

21 MR. GANNAWAY: Object to form and leading.

22 A. Yes.

23 Q. And as we discussed earlier, there's a strict chain of command at TitleMax; correct?

25 A. Yes, ma'am.

0738 Page 123 1 Q. So if your district manager tells you that it's okay, you understand that this is consistent with company policy; correct?

4 A. Yes, ma'am.

5 Q. Okay. And, in fact, you weren't just receiving approval from your manager; he was telling everybody he supervised right in front of you to do the same thing; correct?

9 A. Exactly, which is -- 10 MR. GANNAWAY: Object to form and leading before you respond.

12 A. Okay. That's fair enough. But and that's why I feel confident in being able to say as I'd said earlier when I would say we were because there's a lot of documentation that demonstrates that i t wasn't just me that was being asked and required to do this. It was this was clearly going out to everybody was being asked and required to do this.

19 MR. GANNAWAY: I' 11 object as nonresponsive.

21 Q. And when he says, "Call Todd; there's no reason not to do this," did anyone ever call you in response to this?

24 A. Yes, ma'am.

25 Q. Okay. Who did?

0739 Page 124 l A. I don't remember specifically. I think Jim did. And, again, just to clarify on what he was referring to call Todd about, that was calling Todd about how to be able to use the information that we were already instructed to be using from the database and just mail i t out easier by using the EXCEL spreadsheet and the mail merge. That's the part that I played in terms of just making it easier to -- to mail it out.

9 Q. So then was i t your understanding that all of these stores that Patrick was a-mailing here were already using Public Data to get personal information of customers of competitors?

13 MR. GANNAWAY: Object to form and leading.

14 A. Yes, ma'am.

15 Q. Okay. And how did you develop that understanding?

17 A. Well, several different ways. I mean, clearly through all of the e-mail chains that everybody already has copies of, that's pretty evident. And then just from talking to them. As a matter of fact, there is one of the other -- and that's documented in one of the other a-mails. I'm paraphrasing. But one of the other-- and in response to this e-mail, one of the other managers says -- And I'm paraphrasing -- we're already doing that.

25 I got that idea from somebody else a long time ago.

0740 Tab T NO. 2013-33584 WELLSHIRE FINANCIAL SERVICES, LLC, § IN THE DISTRICT COURT d/b/a LOANSTAR TITLE LOANS, d/b/a § MONEYMAX TITLE LOANS, and d/b/a § LOANMAX; MEADOWWOOD FINANCIAL § SERVICES, LLC, d/b/a LOANSTAR TITLE § LOANS, and d/b/a MONEYMAX TITLE § LOANS; and INTEGRITY TEXAS § FUNDING, LP, § § Plaintiffs, § OF HARRIS COUNTY, TEXAS § v. § § TMX FINANCE HOLDINGS, INC.; § TMX FINANCE, LLC; § TMX FINANCE OF TEXAS, INC.; and § TITLEMAX OF TEXAS, INC., § § Defendants. § 152"d JUDICIAL DISTRICT PLAINTIFFS' MOTION TO COMPEL DISCOVERY RESPONSES FROM DEFENDANTS TMX FINANCE LLC, TMX FINANCE OF TEXAS, INC., AND TITLEMAX OF TEXAS, INC. TO REQUESTS FOR PRODUCTION OF DOCUMENTS COME NOW Plaintiffs Wellshire Financial Services, LLC d/b/a LoanStar Title Loans, d/b/a MoneyMax Title Loans, and d/b/a LoanMax; Meadowwood Financial Services, LLC, d/b/a LoanStar Title Loans, and d/b/a MoneyMax Title Loans and Integrity Texas Funding, LP, (collectively, "LoanS tar") and hereby move this Comt for an order compelling Defendants TMX Finance LLC, TMX Finance of Texas, Inc., and TitleMax of Texas, Inc. (collectively, "TitleMax") to respond to requests for production of documents, and show the Court as follows: I. INTRODUCTION By now, it is patently clear that TitleMax has no compunction about wasting this Court's resources, and instead seeks only to obstruct LoanStar's discovery effmts at every turn, in furtherance of its mission to halt the progress of this case. Indeed, once again TitleMax refuses

0741 to produce information directly relevant to LoanStar's claims, raising meritless relevancy and breadth objections as to requests narrowly tailored to lead to the discovery of admissible evidence. Specifically, TitleMax refuses to provide any substantive response to requests seeking documents and communications directly reflecting TitleMax's illegal conduct as alleged in LoanStar's Petition, and the knowledge of and reaction to that conduct by TitleMax management. Similarly, TitleMax refuses to produce the hard drives for computers used by three employees who engaged in the marketing practices at issue, even though counsel for TitleMax has admitted in open court that at least one of the hard drives at issue appears to contain responsive information not produced in the litigation.

Given that the discovery requests seek information going to the core of LoanStar's claims, TitleMax's objections must be seen for what they are--the latest step in its campaign to delay the litigation and prejudice LoanS tar's efforts to establish its case. LoanStar should not be forced to tum to the Court and consume valuable Court resources each and every time TitleMax defaults on its obligations under the Rules of Civil Procedure. Because TitleMax's latest refusal to participate in the discovery process is just one in the line of many, and because TitleMax defies even express Court Orders, 1 the Court should award LoanStar its fees and costs in being forced to bring yet another discovery motion. As TitleMax has proven time and time again, anything less is insufficient to compel it to act.

II. BACKGROUND OF CASE AND EFFORTS TO MEET AND CONFER Through the discovery process, LoanStar has successfully established that, just as it alleged (see Second Amended Petition ~,! 30-57), numerous TitleMax employees engaged in criminal conduct designed to steal LoanStar's customers. Specifically, TitleMax employees

See LoanStar's Motion to Enforce Court Orders and For Sanctions filed on October 31,2014, to be heard concurrently herewith.

0742 would lurk in LoanStar and other parking lots to record vehicles' license plate and vehicle identification numbers, then use that information to search databases containing motor vehicle records ("DMV Databases") to illegally obtain contact information for the purpose of marketing their services to the owners of the vehicles, including numerous LoanStar customers. TitleMax employees also would search DMV Databases by lienholder name to specifically target the customers of competitors, including LoanStar. TitleMax employees openly engaged in and discussed this conduct, which was in some cases directed by TitleMax management. (Ex. A [Deposition of Randy Rainey at 38-41; Deposition of Michael Ryan at 28-31; Deposition of Patrick Sudduth at 17-22; Deposition of James Griffin at 41-43; Deposition of Richard Todd Hale at 99-l 00].)

Thus, as part of its continuing discovery effm1s, LoanStar served requests for production seeking documents and communications sent, received, or created by four higher-level TitleMax employees (the "Corporate Employees") 2 relating to the DMV Databases and LoanStar customers. In its responses, TitleMax asserts .rote, boilerplate objections that are wholly inapplicable to the requests at issue, and i'Lu1her endeavors to rewrite the requests to seek narrower categories of documents than those requested. Moreover, despite counsel's representation that production would be made in the first week of November, TitleMax has not produced any documents to date. 3 Likewise, TitleMax continues to refuse to produce the hard drives of the computers used by three employees who engaged in the illegal marketing practices at issue in this litigation- Felix DeLeon, Lucia Grajeda, and Todd Hale-even though TitleMax has defaulted on its

The Corporate Employees are Tracy Young, Linda McDonald, Otto Biells, and John Robinson.

Rather, the day before LoanStar filed this motion, TitleMax produced a privilege log respecting searches for the email account of only one of the Corporate Employees, Tracy Young.

0743 obligations to search the hard drives for relevant information. Indeed, notwithstanding the testimony of multiple TitleMax employees (including Hale himself) that the employees at issue possess relevant information, TitleMax has neither produced any records from these employees' computers nor even bothered to conduct a search of two of the hard drives. The one hard drive that was searched, Hale's, has apparently revealed responsive information. Indeed, TitleMax has now represented twice in open court that a search of Hale's computer by counsel located a spreadsheet containing a list of names that may be responsive to an outstanding discovery request, and that it would produce the same. (Ex. B [September 22, 2014 Hearing Transcript at 81-82; October 10, 2014 Hearing Transcript at 59].) But when LoanS tar later requested the promised production, TitleMax backtracked on its representations to the Court and refused to produce the spreadsheet unless LoanStar agreed beforehand, sight unseen, to completely abandon its request for the hard drives of all tluee employees.. LoanStar refused to prejudice itself and accordingly, TitleMax has yet to produce any responsive documents or the hard drives.

In the same way, TitleMax has refused to produce the DeLeon and Grajeda hard drives, even though multiple TitleMax employees have testified that DeLeon and Grajeda possessed and distributed lists of LoanStar customers, and LoanStar expressly requested same. Yet, on meet and confer, TitleMax admitted that the DeLeon and Grajeda hard drives have never been searched.

TitleMax should not be permitted to continue to flout the Court and the Rules of Civil Procedure. Rather, it should be compelled to conduct a reasonable inquiry and produce all responsive information, including the hard drives, within ten days of the hearing on this motion.

0744 III. ARGUMENT AND AUTHORITIES As TitleMax's conduct throughout this case has made clear, TitleMax is intent on delaying the progress of this litigation through obstruction of LoanStar's discovery efforts.

TitleMax effectuates this goal by serving baseless objections, inappropriately withholding responsive documents, and then simply refusing to comply with Comt orders requiring production of same. In so doing, TitleMax purposely delays the progress of the litigation and increases costs for both LoanStar and the Comt. This gamesmanship runs counter to the entire purpose of the discovery process, which is to ensure a just and fair adjudication of claims on their merits. Cf TEX. R. CIV. P. I; In re Dynamic Health, Inc., 32 S.W.3d 876, 886 (Tex. App.-Texarkana 2000, pet. denied); cf Coleman v. Winn-Coleman, Inc., 110 S.W.3d !04, Ill (Tex. App.-Houston [I" Dist.] 2003, no pet.) ("Discovery is favored, and the rules that govern it are to be liberally construed."). In light ofTitleMax's continued improper conduct, the Comt should enter an order compelling TitleMax to produce responsive documents within ten days of the hearing on this motion and award monetary sanctions to cover LoanStar's fees and costs in bringing this motion. TEX. R. Civ. P. 215.1 (e), 215.2(b)(2), and 215.3.

A. TitleMax Must Produce the Corporate Employees' Documents And Communications Reflecting TitleMax's Illegal Marketing Practices Throughout this litigation, TitleMax has assetted inappropriate, rote objections with little or no applicability to the information actually being sought; this time is no different. Here, TitleMax asserts relevance and burden objections to requests seeking documents and communications 4 regarding the very subject matter of the case: (I) marketing to LoanStar's

LoanStar specifically requested this infcmnation due to deposition testimony indicating that the Corporate Employees used text messages to communicate with one another. (Ex. C [Deposition of Linda McDonald at 76-77].) TitleMax indicated during the meet and confer with LoanStar that it had not asked any of the four Corporate Employees for text messages responsive to the Requests.

0745 customers (Ex. D [RFP Nos. II]); (2) communications with the DMV Databases, (id. [RFP Nos. 9, 1OJ); (3) use by TitleMax employees of the DMV Databases to market to customers of competitors (id. [RFP No. 12]), the possession by TitleMax employees of search results from the DMV Databases or other compilations of names and/or addresses including LoanStar customers (id. [RFP Nos. 13, 14]), the recording of license plate or V!Ns during visits to non-TitleMax parking lots (id. [RFP 15, 16]), and non-compliance by TitleMax employees with TitleMax's policies related to the solicitation of competitors' customers (id. [RFP 17]).

TitleMax's responses are crafted in an improper attempt to unilaterally restrict the scope of its production. Indeed, TitleMax reframed the scope of no less than eight of LoanStar's requests in order to substantially limit-or wholly eliminate-the production of any documents. (See Ex. D [Responses to RFP Nos. 10, 12, 13, 14, 15, 16, 17, 18].)

TitleMax's responses to LoanStar's Request Nos. 16 and 18 are emblematic of this tactic: REQUEST NO. 16: Any and all Documents or Communications, inch.1ding but not limited to Text Messages, received, created, or sent by any of the Corporate Employees that refer or relate to relating to any of employees of TMX Finance, TMX Finance TX, and/or TitleMax TX recording, copying, or acquiring vehicle identification numbers (or VlN) or license plate numbers of vehicles located in Non-TitleMax Parking Lots.

RESPONSE: Defendants object to this Request . . . . Subject to, and without waiving, the foregoing objections, Defendants will produce responsive, non- privileged documents relating to license plate numbers or vehicle identification numbers recorded, copied, or acquired during visits to Plaintiffs' parking lots in Texas.

REQUEST NO. 18: Any and all Documents or Communications, including but not limited to Text Messages, received, created, or sent by the Corporate Employees that refer or relate to any noncompliance of employees of TMX Finance, TMX Finance TX, and/or TitleMax TX with TitleMax' policies. rules. and/or codes of conduct related to the solicitation of Customers of Competitors in the state of Texas.

RESPONSE: Defendants object to this Request . . . . Subject to, and without waiving, the foregoing objections, Defendants will produce responsive. non-

0746 privileged policies. rules. and/or codes of conduct related to the solicitation of Customers of Competitors in the state of Texas.

TitleMax's attempted retraming is designed to prevent LoanStar fi·om obtaining critical evidence necessary to its case. For example, TitleMax employees hal'e testified that they improperly searched and identified LoanStar customers by recording license plate numbers not only from LoanStar parking lots, but also apartment parking lots and other shopping centers. (See Ex. E [Deposition of Randy Rainey 39-42 (searching license plates obtained from cars parked in general parking lots); Deposition of James Griffin 115-117 (license plates recorded in other parking lots)].) Accordingly, TitleMax's unilateral limitation of its response to Request No. 16 improperly prevents LoanStar from obtaining the fnll scope of the infmmation to which it is entitled. Similarly, TitleMax's refusal to produce documents reflecting the use of DMV Databases other than DataTrax or PublicData ignores testimony from its own employees that other databases may have been used. (See, e.g., Ex. E [Deposition of Randy Rainey 39-42 (using an unidentified databases for marketing purposes); Deposition of James Griffin 95-96 (unidentified database other than PublicData used to conduct searches); Deposition of Thomas Kirk 124-125 (unspecified database used to create lists of customers for mailers)].) Attempts in this regard to prevent LoanStar from obtaining evidence regarding its claims and TitleMax's purpmted defenses violate the spirit and purpose of the discovery process. Chapa v. Garcia, 848 S.W.2d 667, 668 (Tex. 1992) ("Discovery is designed 'to allow the litigants to obtain the fullest knowledge of the facts and issnes prior to trial."'); Gutierrez v. Dallas Indep. Sch. Dist., 729 S. W.2d 691, 693 (Tex. 1987) ("The rules of discovery were changed to prevent trials by ambnsh and to ensure that fairness would prevail."). Accordingly, this Comt should compel TitleMax to respond to the requests as written.

0747 Further, despite the fact that TitleMax's written responses promise some production, to date no production has been made. During meet and confer, TitleMax promised ·production during the week of November 3, but TitleMax has yet to produce even a single document.

Accordingly, the Court should compel TitleMax to produce responsive documents within ten days of the hearing.

B. TitleMax Must Produce the Hale, DeLeon, and Grajeda Hard Drives As described above, due to the significant discrepancies in TitleMax's responses to requests seeking lists of LoanStar customers in TitleMax's possession, LoanStar requested the hard drives of certain employees known to have maintained such lists. LoanStar first informally requested these hard drives, but TitleMax unequivocally refused to produce the same. (Ex. F [June 18, 2014 E-Mail from Sarah Powers to Geoff Gannaway; June 25, 2014 E-Mail from Geoff Gannaway to Sarah Powers).) LoanStar later served formal requests for production of the hard drives, but notwithstanding TitleMax's clear failure to conduct an adequate search under its own volition, TitleMax once again unequivocally refused to produce. Because the information sought is directly relevant to LoanStar's claims and cannot be recovered by alternate means, the Court should compel TitleMax to produce the hard driv.es. See In re Weekley Homes, L.P., 295 S.W.3d 309,317 (Tex. 2009) (compelling production of hard drives in similar circumstances).

All of the elements the Supreme Court set forth in Weekley to support the production of hard drives are present here. First, TitleMax has unquestionably defaulted on its obligation to search for and provide the requested information. !d. As set forth above, Hale testified that he maintained a spreadsheet on his computer of customers to whom he had sent marketing materials after obtaining their contact inf01mation from PublicData ("Hale Spreadsheet"). (See Ex. G [Deposition of Richard Todd Hale at I 02-1 06] (testifying he saved the spreadsheet on a

0748 computer at "store office number 20")). LoanStar requested production of the Hale Spreadsheet, but TitleMax claimed that no such document could be found. (Ex. H [TitleMax's Response to the Third Request for Production, No. 6].) Only after LoanS tar moved to compel production of the hard drive from Hale's computer did TitleMax even attempt a search, then conveniently representing that the spreadsheet may have been located and would be produced. Yet, TitleMax has not produced the spreadsheet to date, and still refuses to provide the hard drives for expert analysis. In the same way, only upon meet and confer did TitleMax finally admit that it had never searched the Grajeda and DeLeon hard drives, even though those employees pled the Fifth when asked about their searches (see Ex. I [Depositions of Felix DeLeon at 12-16; Lucia Grajeda at 16-18; Ismael Hernandez at 11-21]) and former and current TitleMax employees have consistently testified that Grajeda and DeLeon conducted searches and disseminated search results to other employees. (See e.g., Ex. J [Deposition of Thomas Kirk at II 0-111; Deposition of Michael Ryan at 45-48; Deposition of Patrick Sudduth 43-44].) Accordingly, TitleMax has not engaged in the reasonable search required by Texas law and production of the hard drives is appropriate.

Second, LoanStar seeks production of the hard drives not to itself, but to a qualified expert selected by both parties, with Loan Star to bear the expense of the expert. 5 It is not only feasible but likely that a mutually-selected computer expert will be able to recover the requested information-LoanStar does not seek complex computerized data but merely seeks lists of its own customers, likely to be saved as Excel spreadsheets, Word documents, or text files. An expert analysis of the Grajeda and DeLeon hard drives would locate search results and customer

LoanStar proposes that each party offer three expert candidates and meet and confer regarding selection, with selection to be completed by no later than December I, 2014.

0749 lists saved on the computers, as well as any attempts to delete the infmmation from the computers. The expert's search would be limited to identifying and retrieving the lists and spreadsheet LoanStar has previously expressly requested TitleMax produce.

Finally, there is no question that there is a "direct relationship between the electronic storage device and the claim itself." In re Weekley Homes, L.P., 295 S.W.3d at 319. Here, LoanStar's entire case is founded on TitleMax's improper and illegal use of computerized online databases to identify and market to LoanStar customers. Thus, the parties previously contemplated the production of this information as early as June 2013, when the parties entered into a stipulated injunction under which TitleMax agreed to image all computer hard drives believed to have been involved in the illegal marketing. The agreement contemplated that the images and the information contained thereon would ultimately be produced.

Because LoanStar requested production of the hard drives due to TitleMax's failure to properly search for responsive documents from Hale, Grajeda, and DeLeon and intends to submit the hard drives directly to an expert who will search for, locate, and extract the information sought, TitleMax is facing no burden in production and has no basis for its continued objection to this discovery. Thus, the Cotni should compel TitleMax to produce the requested hard drives within ten days of the hearing on this motion, and award LoanStar its costs and fees in accordance with the Rules.

IV. PRAYER Due to TitleMax's continued, unjustified refusal to abide by its discovery obligations and produce documents responsive to LoanStar's requests for production, this litigation has been

The deletion or destruction of information at the employee level is a pa1iicular concern in this case because, as TitleMax has alleged in its prior pleadings, TitleMax's employees fear criminal prosecution for their actions.

0750 needlessly prolonged and this Collli's resources unnecessarily wasted. Accordingly, this Court should enter an order compelling TitleMax to produce responsive documents within ten days of the hearing and award LoanStar its costs and fees in bringing this motion.

Respectfully submitted, SUTHERLAND ASBILL & BRENNAN LLP By: Is/ Daniel Johnson Kent C. Sullivan (SBN 19487300) Daniel Johnson (SBN 24046165) Robert A. Lemus (SBN 24052225) 1001 Fannin, Suite 3700 Houston, Texas 77002 Telephone: (713) 470-6100 Facsimile: (713) 654-1301 E-mail: [email protected] E-mail: [email protected] E-mail: [email protected] And WARGO & FRENCH LLP Joseph D. Wargo (GA No. 738764) (Admitted Pro Hac Vice) Abigail J. Stecker (CA No. 284534) (Admitted Pro Hac Vice) Peachtree Street, N. E., 26' 11 Floor Atlanta, Georgia 30309 Telephone: (404) 853-1500 Facsimile: (404) 853-150 I E-Mail: [email protected] E-Mail: [email protected] Sarah F. Powers (CA. No. 238184) (Admitted Pro Hac Vice) Christina L. Goebelsmann (CA No. 273379) (Admitted Pro Hac Vice) 1888 Century ParkE, Suite 1520 Los Angeles, California 90067 Telephone: (310) 853-6300 Facsimile: (31 0) 853-6333 E-Mail: [email protected] E-Mail: [email protected]

0751 Attorneys for Wells hire Financial Services, LLC, d/b/a LoanStar Title Loans, d/b/a MoneyMax Title Loans, and d/b/a LoanMax; Meadowwood Financial Services, LLC, d/b/a LoanStar Title Loans, and d/b/a Money Max Title Loans; and Integrity Texas Funding, LP

0752 CERTIFICATE OF CONFERENCE Counsel have conferred and otherwise communicated extensively for weeks about the issues raised in this motion and were unable to reach agreement.

DATED: November 12,2014 Is/ Daniel Johnson Daniel Johnson

0753 CERTIFICATE OF SERVICE This is to certify that I have this day served all parties with a copy of the within and foregoing PLAINTIFFS' MOTION TO COMPEL DISCOVERY RESPONSES FROM DEFENDANTS TMX FINANCE LLC, TMX FINANCE OF TEXAS, INC. AND TITLEMAX OF TEXAS, INC. TO REQUESTS FOR PRODUCTION OF DOCUMENTS has been forwarded to all counsel of record in accordance with TEX. R. Civ. P. 21 and 21a on this 12th day of November 2014.

BECK REDDEN LLP Geoff Gannaway Bryon Rice 1221 McKinney St., Suite 4500 Houston, Texas 77010.

FELLOWS LABRIOLA LLP Stephen LaBriola Christina Baugh Peachtree Center Suite 2300, South Tower Peachtree Street, N .E.

Atlanta, Georgia 30303-1731 Attorneysfor TitleMax TMX Finance of Texas, Inc. and TitleMax of Texas, Inc.

Is/ Daniel Johnson Daniel Jolmson

0754 Exhibit A

0755 I

I NO. 2013-33584 WELLSHIRE FINANCIAL SERVICES, IN THE DISTRICT COURT Page 1 l LLC, d/b/a LOANSTAR TITLE 3 LOANS and INTEGRITY TEXAS FUNDING, LP, Plaintiffs, 5 versus HARRIS COUNTY, TEXAS 6 TMX FINANCE HOLDINGS, INC.; TMX FINANCE, LLC; TMX FINANCE OF 7 TEXAS, INC. ; TITLEMAX OF TEXAS, INC.; FELIX DeLEON; and i ISHMAEL HERNANDEZ, 9 Defendants. 152nd JUDICIAL DIST.

10 ******************************************************* 11 VIDEOTAPED ORAL DEPOSITION OF 12 RANDY LEE RAINEY 13 JULY 8, 2014 14 VOLUME 1 OF 1 15 ****************************************************** 16 VIDEOTAPED ORAL DEPOSITION OF RANDY LEE RAINEY, 17 produced as a witness duly sworn by me at the instance 18 of the Defendants, was taken in the above styled and 19 numbered cause on JULY 8, 2014, from 9:03 AM to 10:44 20 AM, before Beth Howard, CSR in and for the State of 21 Texas, reported by Machine Shorthand, at the offices of 22 Abby Office Preston Center, located at 5956 Sherry Lane, 23 Suite 1000, Dallas, Texas, pursuant to the Texas Rules 24 of Civil Procedure, Notice, Subpoena, and the provisions [ stated on the record or attached hereto. -' --·--------~------------------------------------------------------------------------------- Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0756 I A P P E A R A N C E S Page 2

2 i '.I FOR THE PLAINTIFFS: ! CHRISTINA GOEBELSMANN, ESQ.

Wargo French 4 1888 Century Park East,· suite 1520 Los Angeles, California 90067 5 (310) 853-6807 - FAX: (310) 853-6333 cgoebelsmann®wargofrench.com FOR THE DEFENDANTS TMX FINANCE HOLDINGS, INC.; TMX 7 FINANCE, LLC; TMX FINANCE OF TEXAS, INC.; and TITLEMAX OF TEXAS, INC . : BRYON RICE, ESQ.

9 Beck Redden 1221 McKinney Street, Suite 4500 10 Houston, Texas 77010 (713) 951-6256 - FAX: (713) 951-3720 11 [email protected] 12 VICTORIA H. NEWMAN, ESQ. (Telephonically) TMX Finance 13 15 Bull Street, Suite 200 Savannah, Georgia 31401 14 (912) 503-2824 Victoria.newman®titlemax.com 16 VIDEOGRAPHER: 17 Mr. John Hines Mr. Arthur Estes L______. ___·--·---------····. ·---·--------..--. _ _ _ _..i Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0757 ,--------- l Page 38 I 1 A. Yes.

2 Q. Okay. And did you ever hear of a technique of 3 writing down license plate numbers in parking lots?

4 A. Yes.

5 Q. And who did you hear that from?

6 A. Tom Griffin.

7 Q. And when did you hear that?

8 A. Within a week or so after being hired.

9 Q. So did Tom tell you about the writing down of 10 license plate numbers as part of your training?

11 MR. RICE: Objection, form.

12 A. He stated that this was something he was 13 doing, and I actually went with him several times to do 14 it at a couple of different locations. So I actually -- 15 he actually showed me how to do that.

16 Q. (BY MS. GOEBELSMANN) And where did you go on 17 those several times that you accompanied him?

18 A. There was -- We went probably two times 19 maybe three, but I think at least two times to a 20 competitor that's on Forest Lane and Central Expressway, 21 and that's the -- that's Texas Title, like red and 22 yellow. It's really close to where I live. I live on 23 the other side of the freeway.

24 And another place, I believe it's on ~--~u~-~~n~~~-~-an-~~el t Line, _sam:_~omp~ny. ______ j i Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0758 Page 39 1 And another place on Central Expressway 2 somewhere between -- it's on the west side of Central 3 Expressway, somewhere between, like, Spring Valley and 4 Alpha, somewhere in -- somewhere around there, within a 5 mile or half mile. And it was, like, a little odd -- 6 very odd little mom-and-pop kind of place. It was, 7 like, in a weird little office at the end of, like, a 8 motel. I don't know the name of that place.

9 Q. Was that an auto title loan company?

10 A. I don't know everything -- They did auto 11 loans, the title loans, but I -- they may have had other 12 loan services as well. I'm not sure.

13 Q. Were there any other places that you 14 accompanied Tom where you would be writing down license 15 plate numbers?

16 A. If there is, I don't recall. Just those three 17 that I recall.

18 Q. Okay. And those three times you accompanied 19 him, during what month and year did that occur?

20 A. It would have been within the couple weeks 21 after I was -- within a week to two weeks after I was 22 hired; and I would say somewhere between the second and 23 fourth, fifth week 24 Q. Okay. You -- 25 A. -- when I was there. '--------·- Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0759 ~------

I' Page 40 ' I Q. Would that be November 2011?

I 2 A. Yeah.

3 Q. Okay.

4 A. November -- it may be into early December, but 5 probably not beyond that.

6 Q. Okay. And what exactly did Tom do when he 7 brought you to these parking lots?

8 A. So the first time that we went to -- he went 9 to the one -- and I think -- I know it was at least 10 twice. Maybe I went there more. Maybe three or four 11 times. I'm not sure. But the one on-- the location on 12 Buckingham, I believe it's Buckingham and Belt Line 13 Road, in east Richardson, we would park -- There was 14 some kind of grocery store or something. Like, it was 15 on the corner of the -- of the intersection.

16 So we would park, like, adjacent in the 17 parking lot beside it. And I couldn't really see the 18 license plates, because apparently he had a lot better 19 vision than I did. But sometimes he would call them off 20 and I would write them down.

21 And then he would take his smartphone and 22 just go into, like, a website and log in, and he would 23 find out general information. He told me that that was 24 a website that -- that he paid for. It was information 25 like -- sometimes there were a phone number, address. --------------------- -------·-·--------·----·----j Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0760 ~------------------------

Page 41 I It definitely told if the car that he was looking at in 2 the parking lot just in front of us had a lien against 3 it, you know.

4 I never really questioned the practice, 5 because he said that, you know, he wasn't going on their 6 property, and that this was, you know, public data that 7 he could buy, so ....

8 Q. Do you know what the name was of the website 9 that he used?

10 A. I do not. And I remember he was saying it was 11 maybe 30, 40 bucks a month, something like that; and he 12 got a num a certain number of searches for that, and 13 that could have been like -- I don't remember, 20, 40 14 a -- you know, a month. I don't remember the exact 15 numbers. But it was definitely a dollar amount that he 16 paid for -- I guess you could go up or down on that 17 level and get more searches, and then he --but he had a 18 set number of searches that he could do monthly.

19 Q. So was it your understanding that Tom had paid 20 for this website service and was able to use it for a 21 certain number of searches each month?

22 A. Yes.

23 Q. Okay. Did you ever see the smartphone screen 24 when he was performing these searches?

25 A. Um-hmm. Yeah. He showed me I know at least ~·-·-------------------------------·---------------------------__] Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0761 CAUSE NO. 2013-33584

WELLSHIRE FINANCIAL IN THE DISTRICT COURT SERVICES, LLC d/b/a I.OtiESTJI.R TITLE LOIINS and • INTEGRITY TEXAS Ft.JNDING 1 • "· P~i3.int.if:f:::

vs. 152ND JUDICIAL DISTRICT TMX FIUI\NCE HOLDINGS 1 INC,; 'l'HX FINJ\NCE 1 LLC; TMX FINAUCE OF TEXJ>r.S 1 INC. ; TITLEMJ\X OF TEXAS, INC.; FELIX DELEON; and ISHMIIEL HERUJ\NDEZ, • Defendant::: • *HARRIS COUNTY, TEXAS

ORAL AND VIDEOTAPED DEPOSITION OF MICllAEL RY}.N Jl.JN'E 25 f 2013

ORAL J\.~ VIDEOTAPED DEPOSITION OF MICHAEL R¥AN, p~Qduced as a ~itn~ss at tb~ instance of the PLAINTIFFS, and duly swo~n, was taken in the above-styled and nunbe~od cause on the 25th of JUNE, 2013, ~~om 11:41 a.m. t.o 1:51 p.m., bofo~e MELISSA PARKHILL, CSR, in and for

shorthand, at the law officoe Qf suthe~land h:::bill ~

Brennan, 600 Congress Avenue, Suite 2000, Austin, Travis County, Texae, purzuant to Texas Rules of Civil PrQcedure

0762

' 5 APPEARANCES

7 FOR ~HE P~IN~IFFS:

8 Jessica C. Casey, Attorney at Law WARGO FRENCH 9 999 Puachtroo Street, NE, 26th Floor Atl~nta, Georqi~ 30309 10 ('l04) 853-1500 jcnscyewargofrench,com 1l

13 FOR THE DEFENDANTS 1 THX FINANCE OF TEXJo.S and TITLENAX of TEXAS: Stephen ~. LaBriola, E~q.

15 FELLORS LABRIOLA Suite 2300, South Tower 16 225 Paacht:roo Stroot, NE Atlanta, Georgia 30303 17 (404) 589-9200 slabriolnGfellab.com

"20 Geoff Gnnna~ay, Esq.

BECK REDDEN, LLP 1221 McKinney Street, Suita 4500 21 Houston, Tu~ns 77010 (713) 951-6263 22 99annawayGbcckreddon.com

0763 Pago 28 1 Q. Did you toll them that?

2 A. Yoah. ' Q. Did you tall anybody else ahout this idctil l:11::tweon September of 2012 and Novealber of 2012 when you learned about tho n=• DataTrax?

6 A. Yeah, in Nov~er I -- I -- I brought i t the attention to the -- to the direct ~arketing that we were B doin~ -- tho direct mailers that wo wore doing to my -- my ~upervi:oor, which was Jim Batterson.

Q. We'll coco back to that conversation in just a 11 minute.

12 So once you had the conversation with Lucia and 13 Ishmael in September, what did you do at that point, 14 anything nt"tctr t:l\.llt rt~lated to this infox:mation or theso l.S letters?

16 A. tlo. I -- I told them -- I told the~n that i t 17 :::oundocl. like a great idea. Let's try it.

Did you share that information with any of your " Q.

19 other Au:otin atores?

20 A. 'ie.s.

21 Q. How often after that meetinq did you share this 22 info%'ll'..,.tion?

23 A. Exactly I'~ thinking a couple of weeks.

24 Q. Po you recall what storeB you ~hnrcd thiB idea 25 with?

0764 I'age 29 1 A. Specifically Au~tin 9, ~hich is on G~a~lupe

2 Street -- I know the addxess of that one, 37001 [~>ic]

3 Guadalupe -- ~u~tin 10, which is on L~r, and our TitleB1.1~::ks utore, which i:o also on L;unar.

5 Q. Did the 'l'itlcMax r.tores have numbers? I'm :;orcy.

7 A. Yes.

Q. I'm sorry. Title Bucks you said?

' A. Title Bucks, yes, Title Bucks of Austin 2.

10 Q. And whore is the Title Bucks 2 store located?

11 A. On Lamar Street, too, as well, North Lamar.

12 Q. Who works or who worked in tho Austin 8 store on Guadalupe at tho time that you shared this i.nf"oram.ticm?

15 A. I believe the G.M. at the time was Jarred Do.:der.

1? Q. Do you recall who the S.M. was?

18 A. I had several s,M,s in that store. So exactly which one, I don't I don't know. " 20 Q. And just so I'm clear in a typical Titl~~x

21 ~to~o. thoro•~ a G,H, ~~dan S.H, Axe tho~o a~y otnor titled ~loyee~?

23 A. Some stores dapendinq on their volumes will have c.s.R.s, customer ~ervice reprc$e~tative$.

25 Q. Do you recall wh<l:thC.z; tlu~:z;:~ we:z::e any --

0765 P119'C 30 1 A. tio.

2 Q. -- c.s.R.~ in Austin 8?

3 A. no. At tho time that you ~hared thi~ info~tion ' Q.

5 with Austin 10 on Lamar, do you roc~ll who the G.M. wa~?

Yo~. His name i~ Gabriel-- I'm ~orry. I ' can't A.

rem~er hi~ lA~t nnme.

8 Q. That't: fine, 9 A. You understand I've been cut of the ~rket for several ~~nth5 now.

11 Q. A.~d ju~t to the be.!lt of your ~ility, I'm just at:kinq for what you know.

"· Q.

Riqht.

Do you recall who the S,M, we~ in Auutin lO 11t the time you t:harcd thi$ infonn.a.tion?

16 A. Yeah, A::lelia Figueroa.

17 Q. Anci do you recall any other empl.oyo:es in Austin 10 19 A. ~lo.

20 Q. -- ., r;hat tiz:~e?

21 A. Nuh-uh.

22 Q. For TitJ.eBucks 2 on Lilmar, do you recall -- do they have • G.M. at TitleBucl:s?

24 A. Uh-huh.

25 Q. Who wat: the G.M. at that store at that time?

0766 Paqe 31 1 A. Her n~e ~as Diana Brown.

2 Q. And do you recall if that ~tore had an S.M. or C.C.R. [sic] -- 4 A. ~es, they had an S.M.

5 Q. C.S.R. I'm ~orry . • A. S.M., ~tore manager. I don't recall. That 7 that stor• had z;:avaral S.M. II in i t as w•ll. So I don't rem~cr exactly which one w;a~ there at that time.

9 Q, Ho>t did you come to shnre this informD.tion with each of these stores following your visit with Ishmael and Lucia?

A. Well, asked Lucia to pull -- pull some data b;t .tip eodO>. And I would -- Shr.a vould 11ivw me that in:fo=ation as;: fa:r; as tho custo;~mo:; infolmiOI.tion, and I would disoominato my zip code~ to those stores that were in that -- whore the custornarll livad at.

17 Q. Do you recall tho first timo that you asked Lucia to attain thiz:o informntion from the web ~>itc?

19 A. Exaetly when, no. I'm thinking Oetober som0timo.

21 Q. So ualk mo through that a li ttlo bit. Did somebody ask you for this information or did you just a~k

23 Lucia for i t on your own or how did i t come to be?

A. I asked Lucia on her own so these stores could " participate in a direct marketing program that Ghc waa

0767 Page 1 CAUSE NO. 2013-33584

WELLSHIRE FINANCIAL SERVICES, LLC d/b/a • IN THE DISTRICT COURT LOHES'l'J\R 'l'IZLE LOMI'S and INTEGRIT:i TEXAS FUNDitiG 1 LP, • Ph.intiffs vs. • 152ND JUDICIAL DISTRICT 'rHX FIUJI.NCE HOLDINGS, lHC.; TMX FINANCE, LLC; TMX FINMtCE OF T.E:X11.S 1 • rue.; TITLEHJI.X OF TEXAS 1 I!lC.; FELIX DELEOll; and • ISHHAEL HERNANDEZ, • !il'\nRIS De~endants • COUl!TX, TEXAS

ORAL AND VIOEOT,IU'ED DEPOSI'l'IOll OF PATRICK SUDDUTH JUNE: 25, 2013 ***************************************••··············· ORAL AND VIDEOTAPED DEPOSITION OF PATRICK SUDDUTH, produced as a witness at the instance of the PLAINTIFFS, and duly swo~, was taken in the above-styled and numbered cnu~e on tho 25th of JUNE, 2013, ~rom 2:38p.m. to 4:54p.m., bofoxo ~LISSA PARKHILL, CSR, in and for the State of Texas, reported by eomputcr-nssistcd ~chine

shorthand, at the law offices of Sutherland Asbill ' Brennan, GOO Con9ross Avenue, Suite 2000, Austin, Travis County, Texas, pursuant to Texas Rules of Civil Procodur~

0768 I'll90 2 l and tho provi~~on~ stated on the record.

' 5 APPEARANCES

• i FOR 'I' HE PLAIN'l'IFFS: 8 Jessica C. Caney, Attorney at Law W\RQO Ji'RENCH 9 999 Peachtree Straat, NE, 26th Floor Atlanta, Georgia 30309 10 (404) 853-1500 jcaseyewargofrench.com

13 FOR 'XHE DEFEHDJ\NTS 1 TMX FlNA.>lCE OF TEXAS and 'l'I'l'LEMAX g£ TEXI\S: Stephen T. LaBriola, Esq.

15 FELLOWS LABRIOLA Suito 2300, South 'l'ower 16 225 Peachtree Street, ~E Atlanta, Georgia 30303 11 (404) 599-9200 slabriola9fellab.com

--- Geoff Gannaway, Esq.

BECK REDDEN, LLP 1221 McKinney Struat, Suita 4500 21 Houston, Texas 77010 (713) 951-6263 22 [email protected]

0769 Paqe 17 with thaa i~ busin~ss to bu~iness marketing. Like, if we have un auto r~pnir shop, something like that, where, say, a cu~torner needs $2,000 ~or a transmission and they don't havo that money and tho tranG~ssion placo doesn't offer £inancinq. So we would hope to dcv~lop a partncr~hip with that business so that if th~y had n cu=:ton,e:e lik,. tha.t, they :ui9ht would :::end them to us. We could sec if we could loan that amount of money on their car so that they can have their car now, and then they can pay us.

11 Q. lt.ave you ever heard of th<! web ~::itc DntaTrllX?

12 A. I have.

13 Q. When did you fir1.1t learn or hear that te:r:n.?

14 A. X would say probably I think late December or early January.

16 Q. Tell ~c qonorally what OataTr~ i~::.

17 A. The way I understand it, it's juot a pro9'ram lS that can essentially sort tho lienholder information.

" Q.

20 December· just not referred to a= Dat~Trax?

21 A. Po.G:oibly. I think thu.t'lli the only Wel:!., I think OataTrax is the only n~~e that I heard it referred to by, 24 Q. And ~o late December wall: the first ti=e that you ever heard of thi:; typo of databaBe being used?

0770 Page 18 A. Yenh, a' fa~ as I know.

2 Q. Tell me 2n what context you lea~ned about Dat;:~.'lrax.

• A. Well, Jim gave me a call, whichever i t was, late December or oarly January. And i t W>O -- you /cnow, ho wa~ ba:!lically like, well, X fiquz;ed out why tho no:r:th uide di:triet wa::r -- hoo been beating you quyo for tho l:zu•t fltv months, And he kind of told me Olbout the, you

' l:no\.f, program that :.'..ike had found out about -- Mike Ryan, And I mean, that was essentially it. He kind of told me there•: a way to find, you know, potential customers through lienholder• or, you know, i t was juot a brief summary I guess of what i t wa~.

Q. Did hi!! tell you how anyono a.t Til:l~inx had bceen u~ing that info.mation?

16 A. No. I mean, ho kind of juot told ~e, you know, just it's a way to sort lienholder information. l8 Q. Did ho cuggest what you ~hould do with that inf'orw~.ticm?

20 A, Well, I mean, it 'H'o:L:> kind of like, you kno,.,, it':. appnrently, they're hnving some succcs~ 'H'ith it.

22 So, you kno'H', essentially, you know, get 'H'ith Mike and find out if it's something that might work for y'all.

Q. What did he toll you was $UCOCGGfUl -- bCC~UGO

25 you mentioned that h~ told you thay 'H'ere running

0771 Page 19

2 A. Uh-huh.

3 Q. Eut then beyond that, did he tell you anything

5 A. He just told me i t wua -- ba~ically to find out if, you know, we could send ~ letter or whatever to a potential customer that we would hope to buy out from whatever in$titution they were currently with.

Q. Was thi:o a telephone call that you had with Jim?

1l A. Yes.

12 Q. Did Jim toll you who had been performing these ccarehes?

14 A. No. 15 Q. You mentioned that Hike Ryan's n~c came up in that conversation?

17 A. Yes. lS Q. What did Jim tell you about Mike?

19 A. He just said, you know, to get if I Yanted to get in touch with Hiko and, you know, got como moro of the detailc. But as far as what Jim told me, i t was just, you know, mainly we can sort by any lienholder, you know, essentially from any sort of third-party lender, I guess, like, any -- any financial institution basically.

25 so ...

0772 Pag~ 20 1 Q, Did Jim mention anyono ~lno•s name during that 2 conversation?

3 A. No. Q. After you had that conversation ~ith Jim, what, if anything, did you do?

A ' Well, I mean, obviously given that, you know, we're competitive in nature, I was tired of getting beat.

8 So I roached out to Miko, and I naid, what's -- what'& the deal with thi~. And he kind of just said try and find out any of the third-party lenders for any financial ll institutions in ~-you know, in my port of the city. And if I'd qet that for him, he could sort i t by zip codu and split it up, you know what I mean.

14 Q. Did you do that, did you go out and find that information and provide it to Mike?

16 A. I had-- I'd talked to some of the general managers bccnuae I don't -- quite hono~t~y, I don't ren~ly hnve -- I don't really hnv~ ti~e to do that, But I asked thu~ I guess to me what was I thou9ht was the simplest way to do it was if we h~d ~lready had any doalings -- like, if WR had a~ready maybe bought out n custoaor from a company or whatovor, you know, if we know some of tho~e third-party ~cndc~s based on our interactions with n custo~er, something like thnt. Thnt was pretty much it,

0773 Page 21 1 Q. !loll long after your conversation with Jim Batterson did you get in touch with Hike Ryan?

A. ' Probably pretty soon. H4ybe a day or two, something like that.

5 Q. And then you ~ontionvd that after your conversation with Miko, you :;poke to some of your general :r:~anngers?

• A. Uh-huh,

• Q. Do you recall which general managers you spoke w.ith?

11 A. No, I really don't.

12 Q. Do you recall whether you roached out to all of the general Wl.nagcr:. in your district?

14 A. No, I don't think I reached out to ~1 of them.

15 Q. Why did you reach out to the ones that did you?

15 A. I couldn't tell you ~ecifically. I don't know. That's a-- That's a good question.

18 Q. Had Jim suggested to you any specific stores that could banofit from thosa soarchns?

I would say i t was -- uo woro, you know, " thinking lo~ur purfohrninq ~tores waG probably the focus of that.

Q. Did Jim identify any of tho~o ~tore~

24 specifically?

25 A. No.

0774 1 Q.

2 id~ntify any of tho~e sto~eo specifically?

3 A, No. Q. Do you ~ecall ~y of the general managers that ' you ~poke with about the se~rches immediately following your conservation with Mike?

7 A. I would s~y probably -- I think I know I talked to Rad Casillas. ' Q. What Gtc:u~e i~~: :Rad reoponsiblo for?

10 A. That was Austin 3.

11 Q. Do you recall speaking with other -- any other lZ general managers regarding the searches?

13 A. I think I spoke with Jim Griffin.

What store is Jim responsible for? " Q.

15 A. He was re~onsible for Austin 13. He's no longer with the company.

17 Q. Do you recall approximately how long ago Jim left Titlf!Max?

19 A. M4ybe February or March, r think, 20 Q, DO you recall who took over as general ~nager

21 in Austin 13 after Jim's departure?

22 Yes. Haria Arring~. He wn~ there for 11 days.

23 Q. Following Mr. Arriaga's brief stint at Austin 13, who is the general manager?

25 A. Rudy Perc~. Ho'a still tho G.M. there.

0775 ~---------- Page 1 1 NO. 2013-33584 2 WELLSHIRE FINANCIAL SERVICES, * IN THE DISTRICT COURT LLC, d/b/a LOANSTAR TITLE * 3 LOANS and INTEGRITY TEXAS * FUNDING, LP * 4 * VS. * HARRIS COUNTY, TEXAS 5 * TMX FINANCE HOLDINGS, INC.; * 6 TMX FINANCE, LLC; TMX FINANCE * OF TEXAS, INC.; TITLEMAX OF * 7 TEXAS, INC.; FELIX DELEON; * AND ISHMAEL HERNANDEZ * 152ND JUDICIAL DISTRICT 10 ******************************************* 11 ORAL AND VIDEOTAPED DEPOSITION OF 12 JAMES ARTHUR GRIFFIN 13 MAY 23, 2014 \ 14 VOLUME 1 15 ******************************************* 16 ORAL AND VIDEOTAPED DEPOSITION OF JAMES 17 ARTHUR GRIFFIN, produced as a witness at the instance 18 of the Plaintiffs and duly sworn, was taken in the 19 above-styled and numbered cause on the 23rd day of May, 20 2014, from 9:08a.m. to 2:09p.m., before Marsha Evans, 21 Certified Shorthand Reporter in and for the State of 22 Texas, reported by machine shorthand, at 600 Congress 23 Avenue, 20th Floor, Austin, Texas, pursuant to the 24 Texas Rules of Civil Procedure and the provisions 25 stated on the record or attached hereto.

L.----·-----~-~-------·-~----------·-------···--- _________ __j

Veri text Florida Reporting Co. 800-726-7007 305-376-8800 0776 Page 2 APPEARANCES FOR THE PLAINTIFFS: MS. CHRISTINA GOEBELSMANN 5 MS. SARAH F. POWERS WARGO FRENCH 6 1888 Century Park East, Suite 1520 Los Angeles, California 90067 7 310-853-6807/310-853-6859 (fax) cgoebelsmann®wargofrench.com 8 spowers®wargofrench.com FOR THE DEFENDANTS: MR. GEOFF GANNAWAY 11 BECK REDDEN 1221 McKinney Street, Suite 4500 12 Houston, Texas 77010 713-951-6263/713-951-3720 (fax) 13 ggannaway®beckredden.com 14 --and-- 15 MS. VICTORIA NEWMAN (Via Telephone) TMX FINANCE 16 15 Bull Street, Suite 200 Savannah, Georgia 31401 17 912-503-2824/912-629-1538 (fax) [email protected] 19 ALSO PRESENT: 20 Mr. Manuel Martin, Videographer --------------------·----' Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0777 Page 41 1 knowledge?

2 A. She did.

3 Q. And which store was she general manager?

4 A. The store in the Oak Hill area, kind of West 5 Austin.

6 Q. Did you keep in touch with Sarah or Mayumi 7 after you started in Austin 13?

8 A. We did. We would talk occasionally. I'm 9 still friends with Mayumi on Facebook, so -- we don't 10 discuss TitleMax stuff. We just see each other on 11 Facebook occasionally.

12 Q. When you were still working with TitleMax, 13 would you discuss marketing practices?

14 A. Of course. Absolutely.

15 Q. How often did you discuss your marketing 16 practices?

17 A. Anytime I had a conversation with another GM, 18 marketing inevitably came up.

19 Q. Did you discuss with other GMs the use of DMV 20 records?

21 A. Absolutely.

22 Q. How many times did you have conversations , regarding the use of DMV records?

24 A. I would say every time we talked about 25 marketing we talked about PublicData. And then there L___________________________________________________________________________________________________J Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0778 Page 42 1 was another list that came from our district manager.

2 I don't know what website he got that from, but it was 3 just a -- it was a list that was broken up by zip code 4 that gave a list of names of people who had liens on 5 their vehicles.

6 Q. Who was the district manager that provided you 7 that list?

8 A. Patrick Sudduth.

9 Q. How often did you speak with other GMs?

10 A. Daily.

11 Q. If you had to estimate how many conversations 12 you had with other GMs during the entire time you were 13 with TitleMax, how many conversations would that be?

14 A. Hundreds. 500 times.

15 Q. The ~Ms that you spoke with, where were they 16 working?

17 A. Primarily they were part of the south -- South 18 Austin market. Paul and I, as I mentioned earlier, 19 were good friends. He worked in the North Austin 20 market, so I used to call him. Another lady by the 21 name of Lucia who again was on the north side.

22 Q. What were the names of the GMs that you spoke 23 with?

24 A. Lucia, Paul Walton, Lewis McCall when he was i there,. of course Sarah and Mayumi, Felix, Alberto, the i L - - - ··------ .. - - - - - · ·-··-------~----·---,. .. ------·---- ·-- ·-- ----·--·---··-------·--·----------·-·------·---!

Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0779 l Page 43 1 guy who had called me -- and I cannot believe I can't 2 remember his name. The guy who called me the day that 3 I left the company. Another one on South Lamar. I 4 mean, for the most part we were pretty -- we were a 5 pretty close-knit group and we would all talk.

6 Q. Did you speak with any GMs in any other 7 districts?

8 A. Not after training, no. 9 Q. Did you speak with any other employees that 10 were not GMs regarding marketing practices?

11 lL Assistant managers, yes.

12 Q. Who would you speak with?

13 A. Georgina.

14 Q. She was in your store, correct?

15 A. She was for a short period of time. She used 16 to work for Gilberta at another store, and that's when 17 I used to talk to her, and then, of course, when she 18 worked for me. 19 Q. Any other assistant managers?

20 A. The one that worked for the guy that I can't 21 remember, and I don't remember his name either.

22 Q. Was that on the South Lamar store?

23 A. The South Congress store, the second South 24 Congress store.

25 Q. Do you remember where Lucia worked? ~--------·-------·-----------------------·--··--------------------------) Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0780 Page 1 CAUSE NO. 2013-33504

WELLSHIRE FINANCIAL SERVICES, LLC, d/b/a LONESl'AR ~ITLE LOANS INTEGRITY TEMS FUUDING, .,. • IN :m:e: DISl'RIC'X COURT

LP, Plaintiffs vs. JIARRIS COUN'XY, ~EXAS • """ FINANCE HOLDIUGS, • INC.; TMX FIN1\NCE, LLC; !I'MX FINANCE OF TEX11.S, • INC.; TITLEHAX OF 'I'EMS, INC. I FELIX DeLEON 1 •n• • ISHMAEL HERNIUIDEl:, • Dmfendants • 152ND JUDICIAL DISTRICT

ORJI.l. AHO VIDEOTAPED DEPOSITION OF RICHARD TODD HALE MAY 15, 2014 ~~~~~~····~·~~·~···~···································· ORAL AND VIDEOTAPED DEPOSI'I:ION OF RICHARD TODD HALE, produced a~ a witnos~ at the instance of tho PLAIN'XIFFS, and duly sworn, was taken in tha above-styled and numbered cause on the 15th of HAY, 2014 from 9:06 a.m. to 2:50p.m., before NELISSA P~HILL, CSR, in and for eha st~te of Texas, reported by co~utcr-nssisted machine shorthand, at the law offices of Suthvrland ~bill ' Brennan, 600 Congress Avenue, Suite 2000, Austin, Travis

0781 I'aqe 2 l County, TaKas, pursuant to the Texas Rules of c~v~l

2 Procedure and the provi~ions ~t~ted on the record or attached hereto,

a •

0782 J?nqe 3 1 APPEARANCES

3 FOR XHE PLAI~~IFFS:

4 Sll:r:ah F. Powers, Attorney at Law -and- 5 Christin:z~. Goobolsmann, Att.ornoy at LO\w Hl>.RGO FREHCH 6 1898 Century Park East, Suite 1520 Los Anqalas, California 90067 7 (305) 913-8587 spowers~vargofrench.com • FOR THE DEFEIIDJ\N'l'S: 11 Geof"t" Ganmway, Elfq.

BECK REDDEN, LLP 12 1221 V.cKinnoy, Suito 4500 Houston, Texas 77030 13 (713} 951-6263 qqannaway~beckreddan co~

16 ALSO PRESENT: 17 Cody Hnll, Videogrnpher

0783 Page 99 1 A. I believe that was his lazt nnme, yes, ma'am.

2 Q. Ok~y. Erno~t Pa~o?

' A. Ye.:o, ma'OIJII.

Q. And Rad Cn$illas?

5 A.

' Q. Okay, And what did they tell you about the concept of searching databases?

MR. GANNAWI.Y: Object to :form.

Just that, you know, they wore having zuccoss ' A.

10 with it. You know, they were -- they were all doing i t .

11 They also were -- you know, either learned to do it from so~ebody that was there before them or wore instructed to do i t by Patrick. And that i t was being very successful for thl!lll.

15 Q. And in your case how did you get the initial idea to do that?

17 A. It came fro~ my supervisor, Patrick Sudduth. lB Q. And did Patrick Sudduth tell you where he got the idea to do that?

20 A. No, ~na•am.

21 Q. Did Patrick Sudduth tell you that he was using that idea before?

23 A. Yen, ma'am.

24 Q. Okny. And what did he tell you about that?

25 A. About him usinq i t before?

0784 Page 100 • A.

Ccrruct.

That it had baun ~ucca~~£u~ in hi~ -- in his prav~cu~ region that ho wac at and that, you know, everybody that wa~ u~ing it here' was Geeing a lot more ~uccass with i t here in the Austin area,

' •• What was Patrick Sudduth's previous region?

7 A. I don't-- I don't know. I don't remember.

8 Q. okay. Did Patrick Sudduth ever work out~ide of Texas, to your knowlodqo?

10 A. Yes, ~·am. My understanding is he cnme into Texas from somewhere else. But I don't reme~er -- I

.. don't know where he came from.

okay. So wherever he c~e from before, was it your understanding that he was using the tactic of searching D.H.V. records in order to market to customers of compatitors in that previous area?

17 MR. GANN~WAY: Object to form.

18 A. Yes, ma'am, that'~ ay under$tandinq.

1' Q. Ok3y. And you got that undcr~tanding from conversntionG with Mr. Sudduth?

21 A. ~e~, ma'am.

22 Q. Okay. Now, who set your store's performance

24 A. It was relayed to me from Patrick Sudduth. But ~ undarstandinq from tnlkinq to him, that it waG -- the

0785 Exhibit B

0786 MOTION TO COMPEL SEPT~1BER 22, 2014

2 REPORTER'S RECORD VOLUME 1 OF 1 VOLUMES 3 TRIAL COURT CAUSE NO. 2013-33584 WELLSHIRE FINANCIAL SERVICES, LLC d/b/a ) IN THE DISTRICT COURT LOANSTAR TITLE LOANS, d/b/a MONEYMAX TITLE ) ) LOANS, and d/b/a LOANMAX; MEADOWWOOD ) FINANCIAL SERVICES, LLC, d/b/a LOANSTAR ) LOANS, AND d/b/a MONEYMAX TITLE LOANS; and ) INTEGRITY TEXAS FUNDING, LP ) 8 ) vs. ) HARRIS COUNTY, TEXAS 9 ) TMX FINANCE HOLDINGS, INC.; TMX FINANCE, ) ) LLC; TMX FINANCE OF TEXAS, INC; ) and TITLEMAX OF TEXAS, INC. ) 152ND JUDICIAL DISTRICT 14 MOTION TO COMPEL PRODUCTION 17 On the 22nd day of July, 2014, the following proceedings came on to be held in the above-titled and numbered cause before the Honorable ROBERT K. SCHAFFER, Judge Presiding, held in Houston, Harris County, Texas.

21 Proceedings reported by computerized stenotype machine.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0787 MOTION TO COMPEL SEPTEMBER 22, 2014 1 ~~~s MR. JOHN DANIEL JOHNSON SBOT NO. 24046165 SUTHERLAND ASBILL & BRENNAN, LLP 1001 Fannin Suite 3700 Houston, Texas 77002 Telephone: 713-470-6100 Fax: 713-654-1301 E-mail: [email protected] Counsel for PLAINTIFFS MS. SARAH F. POWERS SBOT NO. CA. 238184 WARGO FRENCH LLP 1888 Century Park F Suite 1520 Los Angeles, California 90067 Telephone: 310-853-6300 Fax: 310-853-6333 E-mail: [email protected] Counsel for PLAINTIFFS MR. GEOFF GANNAWAY SBOT NO. 24036617 MR. BRYON RICE SBOT NO. 24065970 BECK REDDEN 1221 McKinney Suite 4500 Houston, Texas 77010 Telephone: 713-951-6263 Fax: 713-951-3720 E-mail: [email protected] Counsel for DEFENDANTS CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0788 MOTION TO COMPEL SEPTEMBER 22, 2014 illegal activity. Todd Hale expressly testified under oath that he had a spreadsheet of LoanStar customers and other customers that he maintained on his computer and that when he left it was there. It should be there, and they told us that they can't find it.

5 So, that is why we asked that.

6 MR. GANNAWAY: The only evidence they have of any document that we were not able to find from any of those hard drives was Todd Hale's spreadsheet.

9 I will tell your Honor last week I actually went back again to make sure that we had done our level best to try to find the Todd Hale spreadsheet he said in his testimony. I think that he enlisted 20 people on the spreadsheet. It should be have been on his computer in Office No. -- Store No. 20 in Austin. I drove over to Store No 20 in Austin. I went through, again, to make sure that we had done our level best.

16 I did find a spreadsheet that has a list of names and addresses, and I have got it here if your Honor would like to see it.

18 It is not -- entitled Todd Hale Database. He has a little folder that he left behind. It is not in his -- I don't know if this is out to Mr. Hale to ask him -- he is a former employee that doesn't like me very much. And I asked him is this the spreadsheet you are referring to. He said that I went to the Harris County website and I read that the Plaintiffs say that you are using a rogue employee defense. If that applies to me, then I am not going to answer your question. So, please describe your rogue employee defense in detail, CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0789 MOTION TO COMPEL SEPTEMBER 22, 2014 to which I demurred and did not respond.

2 But -- so, any rate, I have a spreadsheet that has a list of names and addresses. I have no other way of knowing that this a good list of names and addresses. But if it is what they want, I got it.

5 THE COURT: Todd Hale is that the name?

6 MR. GANNAWAY: Yes.

7 THE COURT: Have you had any communications with Todd Hale?

8 MS. POWERS: Not since his deposition.

9 THE COURT: So, you don't know if this is the spreadsheet?

10 You haven't asked is this his spreadsheet?

11 MS. POWERS: That's correct. I have not seen it.

12 THE COURT: Wonder how you confirm that that was his spreadsheet that he prepared? Did that come off of his computer?

14 MR. GANNAWAY: It came off -- 15 THE COURT: Well, did that come off a computer that he had access to?

17 MR. GANNAWAY: Yeah. That is true.

18 THE COURT: Make your Request.

19 MS. POWERS: If they'd produced it at the time that we requested, we could have asked it Mr. Hale about it during his deposition.

22 THE COURT: I understand.

23 MR. GANNAWAY: And I'm telling your Honor that I went back and did this again to see if there was anything fitting the category.

25 There is not a search term that I could have run. Doesn't say CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0790 OBJECTIONS TO CORPORATE REPRESENTATIVE DEPOSITIONS OCTOBER 10, 2014 2 REPORTER'S RECORD VOLUME 1 OF 1 VOLUMES 3 TRIAL COURT CAUSE NO. 2013-33584 WELLSHIRE FINANCIAL SERVICES, LLC d/b/a } IN THE DISTRICT COURT LOANSTAR TITLE LOANS, d/b/a MONEYMAX TITLE } } LOANS, and d/b/a LOANMAX; MEADOWWOOD } FINANCIAL SERVICES, LLC, d/b/a LOANSTAR } LOANS, AND d/b/a MONEYMAX TITLE LOANS; and } INTEGRITY TEXAS FUNDING, LP } 8 } vs. } HARRIS COUNTY, TEXAS 9 } TMX FINANCE HOLDINGS, INC.; TMX FINANCE, } } LLC; TMX FINANCE OF TEXAS, INC; } and TITLEMAX OF TEXAS, INC. } 152ND JUDICIAL DISTRICT 14 OBJECTIONS TO CORPORATE REPRESENTATIVE DEPOSITIONS 17 On the lOTH day of July, 2014, the following proceedings came on to be held in the above-titled and numbered cause before the Honorable ROBERT K. SCHAFFER, Judge Presiding, held in Houston, Harris County, Texas.

21 Proceedings reported by computerized stenotype machine.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0791 OBJECTIONS TO CORPORATE REPRESENTATIVE DEPOSITIONS OCTOBER 10, 2014 1 APPEARANCES MR. JOHN DANIEL JOHNSON SBOT NO. 24046165 SUTHERLAND ASBILL & BRENNAN, LLP 1001 Fannin Suite 3700 Houston, Texas 77002 Telephone: 713-470-6100 Fax: 713-654-1301 E-mail: [email protected] Counsel for PLAINTIFFS MS. CHRISTINA GOEBELSMANN SBOT NO. CA. 273379 WARGO FRENCH LLP 1888 Century Park F Suite 1520 Los Angeles, California 90067 Telephone: 310-853-6300 Fax: 310-853-6333 E-mail: [email protected]; [email protected] Counsel for PLAINTIFFS MR. GEOFF GANNAWAY SBOT NO. 24036617 BECK REDDEN 1221 McKinney Suite 4500 Houston, Texas 77010 Telephone: 713-951-6263 Fax: 713-951-3720 E-mail: [email protected] Counsel for DEFENDANTS MR. STEPHEN T. LABRIOLA SBOT NO. FELLOWS LABRIOLA Suite 2300. South Tower 225 Peachtree Street, NE Atlanta, Georgia 30303 Telephone: 404-586-9200 Fax: 404-529-4028 E-mail: [email protected] Counsel for DEFENDANTS CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0792 OBJECTIONS TO CORPORATE REPRESENTATIVE DEPOSITIONS OCTOBER 10, 2014 1 MS. GOEBELSMANN: I'm not sure.

2 MR. GANNAWAY: And let me give a little more context to this, your Honor. This was the subject of an earlier issue we discussed before your Honor.

5 There -- Todd Hale is one of our former employees. He said when I left Store No. 20 in Austin, I left a spreadsheet that I had listed some marketing folks on and some folks that I wanted to market to on it. I believe some of those were obtained from PublicData.

9 So, I went and looked at Store 20. I actually drove to Austin and looked at their computers. And I found a spreadsheet that looks like a list of addresses. It doesn't -- it wasn't Todd Hale's addresses.

13 If it will put the issue to rest, I will produce that to them even if I don't know it's the right document. If you will recall I said I contacted Todd Hale is this your document. He said go-- I'd rather not tell you.

17 THE COURT: Blow it somewhere else?

18 MS. GOEBELSMANN: And that is part of our concern, as well, is that there may be more out there because these employees got so concerned.

21 MR. GANNAWAY: There is no indication it was destroyed.

22 THE COURT: Objection to 5 is sustained.

23 MS. GOEBELSMANN: And, for the record, they have served the same topic on our corporate representative as well but have indicated that they were only going to be going forward if the Court granted CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0793 Exhibit C

0794 ATTORNEYS EYES ONLY I I Page 1 ATTORNEYS' EYES ONLY I NO. 2013-33584 2 WELLSHIRE FINANCIAL SERVICES, IN THE DISTRICT COURT LLC., d/b/a LOANSTAR TITLE 3 LOANS and INTEGRITY TEXAS FUNDING, LP, Plaintiffs, 5 vs. OF HARRIS COUNTY, TEXAS TMX FINANCE HOLDINGS, INC.; 6 TMX FINANCE, LLC.; TMX FINANCE OF TEXAS, INC.; 7 TITLEMAX OF TEXAS, INC.; FELIX DeLEON; and ISHMAEL 8 HERNANDEZ, 9 Defendants.

10 ______________________ !

1:(.

12 ATTORNEYS' EYES ONLY 13 VIDEOTAPE DEPOSITION OF LINDA McDONALD TAKEN: Pursuant to Notice by 15 Counsel for the Plaintiffs 16 PLACE: Hunter MacLean E. Saint Julian Street 17 Savannah, GA 31401 18 DATE: Thursday, May 1, 2014 19 TIME: Began: 8:57a.m.

Ended: 12:34 p.m.

BEFORE: TRACIE L. THOMPSON, RPR, CRR, CLR 21 Notary Public State of Florida at Large !

25 I !

I '----··--------------·-··-·-·---·------------· ---- _______________ j Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0795 ATTORNEYS EYES ONLY l Page 2 ATTORNEYS' EYES ONLY 1 APPEARANCES 2 For the Plaintiffs: SARAH F. POWERS, ESQ.

CHRISTINA GOEBELSMANN, ESQ.

3 Wargo French 1888 Century Park East 4 Suite 1520 Los Angeles, CA 90067 5 305-913-8587 [email protected] 6 [email protected] 9 For the Defendants: STEPHEN T. LaBRIOLA, ESQ.

Fellows LaBriola, LLP 10 225 Peachtree Street, NE Suite 2300, South Tower 11 Atlanta, GA 30303 404-586-9200 12 [email protected] 14 VICTORIA H. NEWMAN, ESQ.

TMX Finance 15 15 Bull Street Suite 200 16 Savannah, GA 31401 912-503-2824 17 [email protected] 19 Also Present: Diana Gundelfinger, Videographer * * * * * * * -------------·-----------------------------·---------·------·-·--J Veri text Florida Reporting Co. 800-726-7007 305-376-8800 0796 ATTORNEYS EYES ONLY Page 76 1 MR. LaBRIOLA: I'm aware of no subpoena.

2 You sent a notice.

3 MS. POWERS: Pardon me?

4 MR. LaBRIOLA: Shorten the time frame and 5 we'll comply with Texas civil procedure.

6 MS. POWERS: Are you planning on producing 7 documents or providing further written response 8 at the end of the 30 day period?

9 MR. LaBRIOLA: Yes, as noted in the 10 pleading file yesterday.

11 BY MS. POWERS: 12 Q Before -- pardon me. Strike that.

13 What prompted you to send the November 2011 14 e-mail you just described?

15 A Our president texted me and said that 16 LoanStar claimed that we were going to their parking 17 lot, that an employee was going to a parking lot.

18 Q In November of 2011?

19 A In November of 2011, and since we had prior 20 discussions that we're not to subscribe to that 21 practice, he asked me to follow up again and make 22 sure that everybody was clear that we should not be 23 following that practice. So I did. I followed up 24 with my regional managers to make sure that they knew 25 and that they spoke to each district manager and that i --·--·--····-- -···-····--·-----------·------------------------··-···-·--·-··-----·--.J Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0797 ATTORNEYS EYES ONLY i I Page 77 1 each district manager spoke to each store that we 2 don't subscribe to that practice.

3 Q And who was the president that texted you?

4 A John Robinson.

5 Q Do you recall what the text said?

6 A It said that LoanStar is claiming we have 7 an employee going to a competitor's parking lot. We 8 need you to check into it and make sure it's not 9 occurring.

10 Q Why do you feel that that practice is a 11 poor business practice?

12 A Again, I think it's not ethical. It's not 13 the right way to do business. It's not an effective 14 way to do business. I just think it's an improper 15 business approach.

16 Q Now, I believe you just testified that 17 prior to November 11 you had heard of the practice of 18 employees going to competitors' parking lots; is that 19 correct?

20 MR. LaBRIOLA: Objection as to form.

21 THE WITNESS: No, I hadn't heard of it. I 22 had -- we have always been coached as employees 23 of TitleMax that we should not do that. We 24 should not go to competitors', any competitors' 25 parking lot and solicit their business because i

··-·--··-····--·---~ Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0798 Exhibit D

0799 NO. 2013-33584 WELLS HIRE FINANCIAL SERVICES, LLC, § IN THE DISTRICT COURT d/b/a LOANSTAR TITLE LOANS, d/b/a § MONEYMAX TITLE LOANS, and d/b/a § LOANMAX; MEADOWWOOD FINANCIAL § SERVICES, LLC, d/b/a LOANSTAR TITLE § LOANS, and d/b/a MONEYMAX TITLE § LOANS; and INTEGRITY TEXAS § FUNDING, LP, § § Plaintiffs, § § v. § OF HARRIS COUNTY, TEXAS § TMX FINANCE HOLDINGS, INC.; § TMX FINANCE LLC; § TMX FINANCE OF TEXAS, INC.; and § TITLEMAX OF TEXAS, INC.; § § Defendants. § 152ND JUDICIAL DISTRICT

DEFENDANTS TMX FINANCE OF TEXAS, INC. AND TITLEMAX OF TEXAS, INC.'S RESPONSES TO PLAINTIFFS' SEVENTH REQUEST FOR PRODUCTION AND DEFENDANT TMX FINANCE LLC'S RESPONSES TO PLAINTIFFS' SECOND REQUEST FOR PRODUCTION

TO: Plaintiffs by and through their attorneys of record, Kent C. Sullivan, Daniel Johnson, and Robert A. Lemus, Sutherland Asbill & Brennan, LLP, 1001 Fannin, Suite 3700, Houston, Texas 77002; and Joseph D. Wargo, Wargo French, LLP, 999 Peachtree Street, N.E. 26 1h Floor, Atlanta, Georgia 30309.

Defendants TMX Finance of Texas, Inc. and TitleMax of Texas, Inc. hereby serve their Responses to Plaintiffs' Seventh Request for Production. Defendant TMX Finance LLC hereby serves its Responses to Plaintiffs' Second Request for Production.

1730.0000 11550071.v I

0800 Respectfully submitted, BECK REDDEN LLP

By: /s/Geo((Gannawav David J. Beck State Bar No. 00000070 Geoff A. Gannaway State Bar No. 24036617 Bryon A. Rice State Bar No. 24065970 1221 McKinney Street, Suite 4500 Houston, Texas 770 I 0 Tel: 713-951-3700 Fax: 713-951-3720 Email: [email protected] g:g:[email protected] brice(i:i'lbeckredden.com Stephen T. LaBriola Christina M. Baugh FELLOWS LABIUOLA LLP Suite 2300, South Tower, Peachtree Center Peachtree Street, N .E.

Atlanta, Georgia 30303-1731 Tel. 404 586-9200 Fax: 404 529-4028 Email: slabriola(cil,fellab.com [email protected] ATTORNEYS FOR DEFENDANTS AND COUNTER- PLAINTIFFS TMX FINANCE OF TEXAS, INC., TITLEMAx OF TEXAS, INC. AND TMX FINANCE LLC ("DEFENDANTS")

1730.0000 11550071.v I 2

0801 CERTIFICATE OF SERVICE I hereby ce11ify that I caused a true and correct copy of the foregoing instrument to be served on counsel of record in accordance with Rules 21 and 21 a of the Texas Rules of Civil Procedure on this 27th day of October, 2014, by email: SUTHERLAND ASBILL & BRENNAN LLP Kent C. Sullivan, Esq.

Daniel Johnson, Esq.

Robert A. Lemus, Esq.

Facsimile: (713) 654-1301 Email: [email protected] Email: [email protected] Email: robert.lemus(r:Usutherland.com Email: carla.kellev!cilsuther!and.com WARGO & FRENCH LLP Joseph D. Wargo, Esq.

Abigail Joy Stecker, Esq.

Sarah Powers, Esq.

Christina Goebelsmann, Esq.

Email: [email protected] Email: [email protected] Email: [email protected] Emai I: [email protected] Email: ecastaneda0!wargofrench.com

Is/ Geoff Gannaway

1730.000011550071 sl 3

0802 General Objections 1. Defendants object to the Instructions to the extent that they seek to place a burden upon Defendants greater than that provided by the Texas Rules of Civil Procedure.

2. Defendants reserve the right to supplement and/or amend its responses to these Requests for Production in accordance with the Texas Rules of Civil Procedure.

3. Defendants object to the definition of"Documents" as overbroad and unduly burdensome. For example, Defendants object to requests for electronic or magnetic data that include "back-up copies" and "dormant or remnant files" because such data is not reasonably available to the responding party in its ordinary course of business. See TEX. R. CIV. P. 196.4. Consequently, Defendants cannot-through reasonable efforts-retrieve the data or information requested or produce it in the form requested. !d.

1730.0000 1/550071.\·l 4

0803 RESPONSES TO SEVENTH REQUEST FOR PRODUCTION REQUEST FOR PRODUCTION NO.1: All Documents that refer or relate to Your claim for attorneys' fees, including any fee agreements between You and Your counsel (including but not limited to Beck Redden LLP and Fellows Labriola LLP) related to this litigation, time records kept by Your counsel, and invoices for legal services provided to You.

RESPONSE: Defendants will produce responsive documents relevant to Defendants' counterclaim, with privileged information redacted.

REQUEST FOR PRODUCTION NO. 2: All Documents or Communications received or sent between You or Your counsel, on the one hand, and any third party (whether pursuant to subpoena or otherwise), on the other hand, relating to searches of the DMV Databases. This includes, but is not limited to, communications between You or Your counsel and the Texas Depatiment of Motor Vehicles, the State of Texas, The Source for Public Data, LP d/b/a PublicData.com, DataTrax Services LLC, and Zebec Data Systems, Inc. RESPONSE: Consistent with the Rules, Defendants will produce documents received as a result of subpoenas they served on third parties. To the extent Plaintiffs contend further information should be produced, Defendants object to this Request as overbroad and unduly burdensome, and as seeking information that is neither relevant nor reasonably calculated to lead to the discovery of admissible evidence.

REQUEST FOR PRODUCTION NO. 3: All Documents or Communications received or sent between You or Your counsel, on the one hand, and any third party, on the other hand, in connection with or related to any subpoena served on the third party in this lawsuit.

RESPONSE: Consistent with the Rules, Defendants will produce documents received as a result of subpoenas they served on third parties. To the extent Plaintiffs contend further information should be produced, Defendants object to this Request as overbroad and unduly burdensome, and as seeking information that is neither relevant nor reasonably calculated to lead to the discovery of admissible evidence.

1730.0000 J"S007J.v I 5

0804 REQUEST FOR PRODUCTION NO. 4: Any and all Documents or Communications received or sent between You or Your counsel and any expert designated by You in this case.

RESPONSE: Defendants object that this Request is barred by Texas Rule of Civil Procedure 195.1.

REQUEST FOR PRODUCTION NO.5: The Hard Drives of each and every computer in Your possession, custody, or control to which Todd Hale had access while employed by You.

RESPONSE: Defendants object to this Request as overbroad and unduly burdensome and as seeking information that is neither relevant nor reasonably calculated to lead to the discovery of admissible evidence. The Texas Supreme Court has recognized that "[p]roviding access to information by ordering examination of a party's electronic storage device is particularly intrusive and should be generally discouraged, just as permitting open access to a party's file cabinets for general perusal would be." In re Weekley Homes, 295 S.W.3d 309, 317 (Tex. 2009) (orig. proceeding).

As a threshold matter, the requesting party must show that the responding party has somehow defaulted in its obligation to search its records and produce the requested data. The requesting party should also show that the responding party's production "has been inadequate and that a search of the opponent's [electronic storage device] could recover deleted relevant materials." Courts have been reluctant to rely on mere skepticism or bare allegations that the responding party has failed to comply with its discovery duties. Even if the requesting party makes this threshold showing, courts should not permit the requesting party itself to access the opponent's storage device; rather, only a qualified expert should be afforded such access, and only when there is some indication that retrieval of the data sought is feasible. Due to the broad array of electronic information storage methodologies, the requesting party must become knowledgeable about the characteristics of the storage devices sought to be searched in order to demonstrate the feasibility of electronic retrieval in a particular case. And consistent with standard prohibitions against "fishing expeditions," a 1730.0000 1/55007].\' l 6

0805 court may not give the expert carte blanche authorization to sort through the responding party's electronic storage device. Instead, comis are advised to impose reasonable limits on production. Finally, federal courts have been more likely to order direct access to a responding party's electronic storage devices when there is some direct relationship between the electronic storage device and the claim itself. !d. at 317-19 (internal citations omitted). None of the necessary showings have been made: Defendants have not defaulted on their obligation to search records, and there has been no evidence that a search might recover deleted materials, that retrieval of the data sought might be feasible, "the particular characteristics of the electronic storage devices involved, the familiarity of [Plaintiffs'] expetis with those characteristics, or a reasonable likelihood that the proposed search methodology would yield the information sought." I d. at 311. Moreover, if the Comi orders Defendants to produce hard drives, Defendants request an "order that the requesting party pay the reasonable expenses of any extraordinary steps required to retrieve and produce the information." TEX. R. CIV. P. 196.4.

REQUEST FOR PRODUCTION NO. 6: The Hard Drives of each and evety computer in Your possession, custody, or control to which Lucia Grajeda had access while employed by You.

RESPONSE: Defendants incorporate by reference the response to Request No.5.

REQUEST FOR PRODUCTION NO.7: The Hard Drives of each and every computer in Your possession, custody, or control to which Felix DeLeon had access while employed by You.

RESPONSE: Defendants incorporate by reference the response to Request No. 5.

REQUEST FOR PRODUCTION NO.8: Documents sufficient to identifY the company or companies that provided mobile phone services for any mobile phone numbers used by any of the Corporate Employees for each month between August 2011 and June 2013.

RESPONSE: Defendants object to this Request as overbroad and unduly ! 730.000DI/.'i5007l.v l 7

0806 burdensome and as seeking information that is neither relevant nor reasonably calculated to lead to the discovery of admissible evidence.

REQUEST FOR PRODUCTION NO. 9: Any and all Documents and Communications, including but not limited to Text Messages, received, created, or sent by any of the Corporate Employees to/from representatives or employees of DataTrax, PublicData and/or any other DMV Databases.

RESPONSE: Defendants object to this Request as overbroad and unduly burdensome and as seeking information that is neither relevant nor reasonably calculated to lead to the discovery of admissible evidence. Defendants further object to the request for "Text Messages" because such data is not reasonably available to the responding party in its ordinary course of business. See TEX. R. CIV. P. 196.4. Consequently, Defendants cannot-through reasonable efforts- retrieve the data or information requested or produce it in the form requested. Id. Lastly, Defendants object to the extent responsive documents have already been produced or Plaintiffs have been informed that no responsive documents exist.

Subject to, and without waiving, the foregoing objections, Defendants will produce responsive, non-privileged documents received, created, or sent by any of the Corporate Employees to/from representatives or employees of DataTrax, PublicData and/or any other DMV Databases in Texas.

REQUEST FOR PRODUCTION NO. 10: Any and all Documents and Communications, including but not limited to Text Messages, received, created, or sent by any of the Corporate Employees that refer or relate to any of the DataTrax, PublicData and/or any other DMV Databases.

RESPONSE: Defendants object to this Request as overbroad and unduly burdensome and as seeking information that is neither relevant nor reasonably calculated to lead to the discovery of admissible evidence. Defendants further object to the request for "Text Messages" because such data is not reasonably available to the responding party in its ordinary course of business. See TEX. R. C!v. P. 196.4. Consequently, Defendants cannot-through reasonable efforts- retrieve the data or information requested or produce it in the form requested.· !d.

Lastly, Defendants object to the extent responsive documents have already been produced or Plaintiffs have been informed that no responsive documents exist.

Subject to, and without waiving, the foregoing objections, Defendants will produce I 730.0000 !/550071.v l 8

0807 responsive, non-privileged documents relating to use ofDataTrax or PublicData to identify Plaintiffs' customers in Texas.

REQUEST FOR PRODUCTION NO. 11: Any and all Documents and Communications, including but not limited to Text Messages, received, created, or sent by any of the Corporate Employees that refer or relate to Marketing to Customers ofLoanStar and/or Integrity.

RESPONSE: Defendants object to this Request as overbroad and unduly burdensome and as seeking information that is neither relevant nor reasonably calculated to lead to the discovery of admissible evidence. Defendants further object to the request for "Text Messages" because such data is not reasonably available to the responding party in its ordinary course of business. See TEX. R. CIV. P. 196.4. Consequently, Defendants cannot-through reasonable effotis- retrieve the data or information requested or produce it in the form requested. !d.

Lastly, Defendants object to the extent responsive documents have already been produced or Plaintiffs have been informed that no responsive documents exist.

Subject to, and without waiving, the foregoing objections, Defendants will produce responsive, non-privileged documents that refer or relate to Marketing to Customers ofLoanStar and/or Integrity in Texas.

REQUEST FOR PRODUCTION NO. 12: Any and all Documents and Communications, including but not limited to Text Messages, received, created, or sent by any of the Corporate Employees that refer or relate to employees of TMX Finance, TMX Finance TX, and/or TitleMax TX using the DMV Databases to Market to Customers of Competitors within the State of Texas.

RESPONSE: Defendants object to this Request as overbroad and unduly burdensome and as seeking information that is neither relevant nor reasonably calculated to lead to the discovery of admissible evidence. Defendants fmiher object to the request for "Text Messages" because such data is not reasonably available to the responding patiy in its ordinary course of business. See TEX. R. CIV. P. 196.4. Consequently, Defendants cannot-through reasonable efforts- retrieve the data or information requested or produce it in the form requested. !d.

Lastly, Defendants object to the extent responsive documents have already been produced or Plaintiffs have been informed that no responsive documents exist.

Subject to, and without waiving, the foregoing objections, Defendants will produce 1730.0000 1/550071.\·] 9 0808 responsive, non-privileged documents relating to use ofDataTrax or PublicData to identifY Plaintiffs' customers in Texas.

REQUEST FOR PRODUCTION NO. 13: Any and all Documents or Communications, including but not limited to Text Messages, received, created, or sent by any of the Corporate Employees that refer or relate to the possession of search results from the DMV Databases by employees ofT.MX Finance, T.MX Finance TX, and/or TitleMax.

RESPONSE: Defendants object to this Request as overbroad and unduly burdensome and as seeking information that is neither relevant nor reasonably calculated to !~ad to the discovery of admissible evidence. Defendants further object to the request for "Text Messages" because such data is not reasonably available to the responding party in its ordinary cqurse of business. See TEX. R. Crv. P. 196.4. Consequently, Defendants cannot-through reasonable efforts- retrieve the data or information requested or produce it in the form requested. !d.

Lastly, Defendants object to the extent responsive documents have already been produced or Plaintiffs have been informed that no responsive documents exist.

Subject to, and without waiving, the foregoing objections, Defendants will produce responsive, non-privileged documents relating to possession of search results from DataTrax or PublicData conducted to identify Plaintiffs' customers in Texas.

REQUEST FOR PRODUCTION NO. 14: Any and all Documents or Communications, including but not limited to Text Messages, received, created, or sent by any of the Corporate Employees that refer or relate to the possession of a list or other compilation of names and/or addresses including customers of Integrity or LoanStar in Texas by employees of T.MX Finance, T.MX Finance TX, and/or TitleMax TX.

RESPONSE: Defendants object to this Request as overbroad and unduly burdensome and as seeking information that is neither relevant nor reasonably calculated to lead to the discovery of admissible evidence. Defendants further object to the request for "Text Messages" because such data is not reasonably available to the responding party in its ordinary course of business. See TEX. R. Crv. P. 196.4. Consequently, Defendants cannot-through reasonable efforts- retrieve the data or information requested or produce it in the form requested. Id. Lastly, Defendants object to the extent responsive documents have already been produced or Plaintiffs have been informed that no responsive documents exist.

1730.0000 1!55007J.v I 10

0809 Subject to, and without waiving, the foregoing objections, Defendants will produce responsive, non-privileged documents relating to possession of a list from DataTrax or PublicData conducted to identify Plaintiffs' customers in Texas.

REQUEST FOR PRODUCTION NO. 15: Any and all Documents or Communications, including but not limited to Text Messages, received, created, or sent by any of the Corporate Employees that refer or relate to license plate numbers recorded, copied, or acquired during visits by employees ofT.MX Finance, T.MX Finance TX, and/or TitleMax TX to any Non- TitleMax Parking Lots.

RESPONSE: Defendants object to this Request as overbroad and unduly burdensome and as seeking information that is neither relevant nor reasonably calculated to lead to the discovery of admissible evidence. Defendants further object to the request for "Text Messages" because such data is not reasonably available to the responding party in its ordinary course of business. See TEX. R. CJV. P. 196.4. Consequently, Defendants cannot-through reasonable efforts- retrieve the data or information requested or produce it in the form requested. !d.

Lastly, Defendants object to the extent responsive documents have already been produced or Plaintiffs have been informed that no responsive documents exist.

Subject to, and without waiving, the foregoing objections, Defendants will produce responsive, non-privileged documents relating to license plate numbers recorded, copied, or acquired during visits to Plaintiffs' parking lots in Texas.

REQUEST FOR PRODUCTION NO. 16: Any and all Documents or Communications, including but not limited to Text Messages, received, created, or sent by any of the Corporate Employees that refer or relate to relating to any of the employees of T.MX Finance, T.MX Finance TX, and/or TitleMax TX recording, copying, or acquiring vehicle identification numbers (or YIN) or license plate numbers of vehicles located in Non-TitleMax Parking Lots.

0810 retrieve the data or information requested or produce it in the form requested. ld.

Lastly, Defendants· object to the extent responsive documents have already been produced or Plaintiffs have been informed that no responsive documents exist.

Subject to, and without waiving, the foregoing objections, Defendants will produce responsive, non-privileged documents relating to license plate numbers or vehicle identification numbers recorded, copied, or acquired during visits to Plaintiffs' parking lots in Texas.

REQUEST FOR PRODUCTION NO. 17: Any and all Documents or Communications, including but not limited to Text Messages, received, created, or sent by any of the Corporate Employees that refer or relate to TitleMax's policies, rules, and/or codes of conduct related to the solicitation of Customers of Competitors in the state of Texas by employees of TMX Finance, TMX Finance TX, and/or TitleMax TX.

RESPONSE: Defendants object to this Request as overbroad and unduly burdensome and as seeking information that is neither relevant nor reasonably calculated to lead to the discovery of admissible evidence. Defendants fi.Irther object to the request for "Text Messages" because such data is not reasonably available to the responding patiy in its ordinary course of business. See TEX. R. Crv. P. 196.4. Consequently, Defendants cannot-through reasonable efforts- retrieve the data or information requested or produce it in the form requested. ld.

Defendants also 0 bject to the extent responsive documents have already been produced or Plaintiffs have been informed that no responsive documents exist.

Lastly, Defendants object to the extent this Request calls for documents subject to attorney-client or work product privileges. Subject to, and without waiving, the foregoing objections, Defendants will produce responsive, non-privileged policies, rules, and/or codes of conduct related to the solicitation of Customers of Competitors in the state of Texas.

REQUEST FOR PRODUCTION NO. 18: Any and all Documents or Communications, including but not limited to Text Messages, received, created, or sent by any of the Corporate Employees that refer or relate to any noncompliance of employees of TMX Finance, TMX Finance TX, and/or TitleMax TX with TitleMax's policies, rules, and/or codes of conduct related to the solicitation of Customers of Competitors in the state of Texas.

1730.0000 !/550071.v l 12

0811 RESPONSE: Defendants object to this Request as overbroad and unduly burdensome and as seeking information that is neither relevant nor reasonably calculated to lead to the discovery of admissible evidence. Defendants further object to the request for "Text Messages" because such data is not reasonably available to the responding party in its ordinary course of business. See TEX. R. C!V. P. 196.4. Consequently, Defendants cannot-through reasonable efforts- retrieve the data or information requested or produce it in the form requested. ld.

Defendants object to the extent responsive documents have already been produced or Plaintiffs have been informed that no responsive documents exist. Lastly, Defendants object to the extent this Request calls for documents subject to attorney-client or work product privileges. Subject to, and without waiving, the foregoing objections, Defendants will produce responsive, non-privileged policies, rules, and/or codes of conduct related to the solicitation of Customers of Competitors in the state of Texas.

REQUEST FOR PRODUCTION NO. 19: Any and all Documents or Communications, including but not limited to Text Messages, received, created, or sent by any of the Corporate Employees that refer or relate to the allegations in the complaint, amended complaints, or answers thereto.

RESPONSE: Defendants object to this Request as overbroad and unduly burdensome and as seeking information that is neither relevant nor reasonably calculated to lead to the discovery of admissible evidence. Defendants further object to the request for "Text Messages" because such data is not reasonably available to the responding party in its ordinary course of business. See TEX. R. C!V. P. 196.4. Consequently, Defendants cannot-through reasonable efforts- retrieve the data or information requested or produce it in the form requested. ld.

Defendants also object to this Request as vague and ambiguous and to the extent responsive documents have already been produced or Plaintiffs have been told responsive documents do not exist.

REQUEST FOR PRODUCTION NO. 20: Any and all Documents or Communications, including but not limited to Text Messages, received, created, or sent by the Corporate Employees that refer or relate to the allegations in the Petition and/or Answer.

RESPONSE: Defendants object to this Request as overbroad and unduly I 730.00001/55007 I .vI 13

0812 burdensome and as seeking information that is neither relevant nor reasonably calculated to lead to the discovery of admissible evidence. Defendants further object to the request for "Text Messages" because such data is not reasonably available to the responding party in its ordinary course of business. See TEX. R. CJV. P. 196.4. Consequently, Defendants cannot-.through reasonable efforts- retrieve the data or information requested or produce it in the form requested. ld.

Defendants also object to this Request as vague and ambiguous and to the extent responsive documents have already been produced or Plaintiffs have been told responsive documents do not exist.

I730,00001155007! .vI 14 0813 Exhibit E

0814 -------------1 I' Page 1 I f NO. 2013-33584 I 2 WELLSHIRE FINANCIAL SERVICES, IN THE DISTRICT COURT I!

I LLC, d/b/a LOANSTAR TITLE i 3 LOANS and INTEGRITY TEXAS I FUNDING, LP, Plaintiffs, 5 versus HARRIS COUNTY, TEXAS 6 TMX FINANCE HOLDINGS, INC.; TMX FINANCE, LLC; TMX FINANCE OF 7 TEXAS, INC.; TITLEMAX OF TEXAS, INC.; FELIX DeLEON; and 8 ISHMAEL HERNANDEZ, 9 Defendants. 152nd JUDICIAL DIST.

17 produced as a witness duly sworn by me at the instance 18 of the Defendants, was taken in the above styled and 19 numbered cause on JULY 8, 2014, from 9:03AM to 10:44 20 AM, before Beth Howard, CSR in and for the State of 21 Texas, reported by Machine Shorthand, at the offices of 22 Abby Office Preston Center, located at 5956 Sherry Lane, 23 Suite 1000, Dallas, Texas, pursuant to the Texas Rules 24 of Civil Procedure, Notice, Subpoena, and the provisions 25 stated on the record or attached hereto. iL_ ______________________________________________________________________________________________________________________ ji

Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0815 -----------------------------·-----1 Page 2 1 APPEARANCES 2 FOR THE PLAINTIFFS: 3 CHRISTINA GOEBELSMANN, ESQ.

Wargo French 4 1888 Century Park East, Suite 1520 Los Angeles, California 90067 5 (310) 853-6807 - FAX: (310) 853-6333 cgoebelsmann®wargofrench.com FOR THE DEFENDANTS TMX FINANCE HOLDINGS, INC.; TMX 7 FINANCE, LLC; TMX FINANCE OF TEXAS, INC.; and TITLEMAX OF TEXAS, INC. : BRYON RICE, ESQ.

9 Beck Redden 1221 McKinney Street, Suite 4500 10 Houston, Texas 77010 (713) 951-6256 - FAX: (713) 951-3720 11 brice®beckredden.com 12 VICTORIA H. NEWMAN, ESQ. (Telephonically) TMX Finance 13 15 Bull Street, Suite 200 Savannah, Georgia 31401 14 (912) 503-2824 [email protected] 16 VIDEOGRAPHER: 17 Mr. John Hines Mr. Arthur Estes Veritext Florida Repmting Co. 800-726-7007 305-376-8800 0816 ------··----·-----·--·--··--·-, Page 39 1 And another place on Central Expressway 2 somewhere between -- it's on the west side of Central 3 Expressway, somewhere between, like, Spring Valley and 4 Alpha, somewhere in -- somewhere around there, within a 5 mile or half mile. And it was, like, a little odd -- 6 very odd little mom-and-pop kind of place. It was, 7 like, in a weird little office at the end of, like, a 8 motel. I don't kno~1 the name of that place.

9 Q. Was that an auto title loan company?

10 A. I don't know everything -- They did auto 11 loans, the title loans, but I -- they may have had other 12 loan services as well. I'm not sure.

13 I Q. Were there any other places that you i accompanied Tom where you would be writing down license 15 plate numbers?

16 A. If there is, I don't recall. Just those three 17 that I recall.

18 Q. Okay. And those three times you accompanied 19 him, during what month and year did that occur?

20 A. It would have been within the couple weeks 21 after I was -- within a week to two weeks after I was 22 hired; and I would say somewhere between ·the second and 23 fourth, fifth week 24 Q. Okay. You -- 25 A. -- when I was there. ---·---·····-----·-------·-·····-··-·-· Veritext Florida Repotting Co. 800-726-7007 305-376-8800 0817 ,- I Page 40 I Q. Would that be November 2011?

I 2 A. Yeah.

3 ' I Q. Okay. i 4 A. November -- it may be into early December, but 5 probably not beyond that.

6 Q. Okay. And what exactly did Tom do when he 7 brought you to thes~ parking lots?

8 A. So the first time that we went to -- he went 9 to the one -- and I think -- I know it was at least 10 twice. Maybe I went there more. Maybe three or four 11 times. I'm not sure. But the one on -- the location on 12 Buckingham, I believe it's Buckingham and Belt Line 13 Road, in east Richardson, we would park -- There was 14 some kind of grocery store or something. Like, it was 15 on the corner of the -- of the intersection.

21 And then he would take his smartphone and 22 just go into, lil~:e, a website and log in, and he would i' 23 find out general information. He told me that that was II 24 a website that -- that he paid for. It was information 25 like -- sometimes there were a phone number, address.

I I -----·--·--···---··--· - - ---------------~-----------------_____) Veritext Florida Reporting Co. 800-726-7007 305-376-8800 0818 r----------------------------- ------~

Page 41 'i' ' It definitely told if the car that he was looking at in ' I the parking lot just in front of us had a lien against l I ' .it, you know.

4 I never really questioned the practice, 5 because he said that, you know, he wasn't going on their 6 property, and that this was, you know, public data that 7 he could buy, so ....

8 Q. Do you know what the name was of the website 9 that he used?

10 A. I do not. And I remember he was saying it was 11 maybe 30, 40 bucks a month, something like that; and he 12 got a num a certain number of searches for that, and 13 that could have been like-- I don't remember, 20, 40 14 a -- you know, a month. I don't remember the exact 15 numbers. But it was definitely a dollar amount that he 16 paid for -- I guess you could go up or down on that 17 level and get more searches, and then he -- but he had a 18 set number of searches that he could do monthly.

19 Q. So was it your understanding that Tom had paid 20 for this website service and was able to use it for a i· certain number of searches each month? ' 22 A. Yes.

23 Q. Okay. Did you ever see the smartphone screen 24 when he was performing these searches?

25 I A. um-hmm. Yeah. He showed me I know at least [____________________________________________________________________________________________________ !

Veritext Florida Reporting Co. 800-726-7007 305-376-8800.

0819 ~wher~~h~ ~ind ~ecroll Page 42 1 would of do= end -- It's on 2 his iPhone. He would just scroll down and I would see 3 various information about -- that was associated with 4 that license plate.

5 Q. Okay. And do you remember what that screen 6 that you were viewing looked like?

7 A. Just your basic kind of gridded-out screen 8 that you would see, with, you know, like a like a 9 name and, like, information about it, like the -- like 10 name and -- the person's name and address and stuff like 11 that.

12 Q. What color was the screen?

13 A. I don't remember it being any bright colors.

14 It was -- I don't I don't really remember.

15 Q. Okay. And do you remember how many search 16 results would come up when he would search a license 17 plate number?

18 A. Well, just the one result, because it ~10uld be 19 whatever data that that search engine or company or 20 whatever he was using had.

21 Q. Okay. Did he -- did Tom ever tell you whether 22 or not he could search using information other than 23 license plate numbers?

24 A. No. I don't remember anything like that, 25 other than just that method I told you.

L_____________________________________________________________________________________________________ _ Veritext Florida Rep011ing Co. 800-726-7007 305-376-8800 0820 Exhibit F

0821 Goebelsmann, Christina From: Geoff Gannaway <[email protected]> Sent: Wednesday, June 25, 2014 7:46 PM To: Powers, Sarah; Bryon Rice; 'Johnson, Daniel'; Wargo, Joseph D.; Goebelsmann, Christina; Stecker, Abigail Cc: 'Steve LaBriola'; 'Christina Baugh'; '[email protected]' Subject: RE: Wellshire et al. v. TMX Holdings et al.

Sarah: We do not agree to provide the hard drive images. If you have requests for specific documents, we will respond to them through the normal course of discovery.

From: Powers, Sarah [mailto:[email protected]] Sent: Wednesday, June 18, 2014 7:40 PM To: Geoff Gannaway; Bryon Rice; 'Johnson, Daniel'; Wargo, Joseph D.; Goebelsmann, Christina; Stecker, Abigail Cc: 'Steve LaBriola'; 'Christina Baugh'; '[email protected]' Subject: Wellshire et al. v. TMX Holdings et al.

Geoff- I am writing to request Defendants' production to Plaintiffs of certain hard drives of computers used to conduct the conduct described in Plaintiffs' Petition. As you know, based on the deposition testimony of both Mike Ryan and Todd Hale himself, Mr. Hale maintained a spreadsheet on his computer of customers to whom he had sent marketing materials, after obtaining their contact information from PublicData. We have requested the spreadsheet through a request for production, and Defendants' response was that the spreadsheet could not be located. Accordingly, we would like to submit the hard drive to our forensic computer expert for his analysis. Similarly, because both Felix Deleon and Lucia Grajeda exercised their Fifth Amendment right to refuse to testify regarding their involvement in the illegal conduct, we intend to submit to our forensic expert the computers they used during the relevant time period of their employment with TitleMax. As each of these computers' hard drives has been imaged per the June 28, 2013 Rule Agreement, please also produce the images of these hard drives for comparison.

Please call me if you would like to discuss.

Sincerely, Sarah F. Powers WARGO FRENCH 1888 Century Park East, Suite I 520 Los Angeles, California 90067 Telephone: (31 0) 853-6453 (direct) Facsimile: (31 0) 853-6333 E-Mail: [email protected] Website: www.\vargofrench.com WARGOIJF= FHENCH Ii Atlanta l Lcs f\nge!es I i·.'li?-ml

The information in this message is intended for the addressee only and may contain privileged and confidential information. If you are not the intended recipient, please immediately stop reading this message, delete it from your system and notif'y the sender at spowers@wanrofi·eneh.com that it has been deleted. Any unauthorized reading, distribution, dissemination, copying, or other use of the information in this message is strictly prohibited.

0822

0823 Exhibit G

0824 PIUJO l CAUSE NO. 2013-33584

li&LLSHIRE FINANCI1U. IN THE DISTRICT COURT SER~CES, LLC, d/b/~ LONESTAR TITLE LOANS and • INTEGRI'l'Y TEXAS FUliDlNG 1 LP, • Plaintiff:-: • vs. * H.liJUUS COtJWl'!C, TEXAS ~ FINANCE HOLOINGS, l.NC,; '1'MX. FINANe£, l.LC; • TMX FI!IMCE OF TEAAS 1 INC. ; 'I'ITL'EMJ>.X OF TEXAS 1 INC.; FELIX DeLEON; and ISHMl\EL HERNANDEZ, Defendants 152ND JUDICIAL DISTRICT

ORAL AND VIDEOTAPED DEPOSITION OF RICHARD TODD HALE H~Y 15, 2014 *************************~******************************

ORAL Nro VIDEO:t'APED DEPOSITION OF 1\IC/J.Aru) !rOOD HALE, produced as a witness at the instance of the PLAINTIFFS, and duly sworn, was taken in the abovc-styl~d and numbered cuu:oe on the 15th of HAY, 2014 from 9:06 a,n, to 2:50p.m., before MELISSA PARKHILL, CSR, in and for the state of Tex~s, roport~d by computer-assisted ~chino

uhorthand, at tho law offices of Sutherland Asbill G Brennan, 600 Congress Avenue, Suite 2000, AUstin, Travis

0825 ~ County, Texas, pursu~nt to the Texas Rul~s of Civil Procedure and the provi~ions stated on tho record or attttohed hereto.

' s

' lO l1

" l7 lB ,.

0826 1 AI'I'&ARANCES

3 FOR THE PLAINTIFFS: 4 sarah F. Powc:es, .1\tto>:ney at LllW -pnd- 5 Christina Gocbols1r.:mn, AttoJ::nQ!( at Law WARGO FRENCH 2888 century !'ark East, Suite 1520 ' Los Angelos, California S0067 7 (305) 913-8587 spowors~wa:egofroneh.eom • • FOR THE DEFENDANTS: ll Geoff Gannaway, Esq.

BECK nEDDEN 1 LLP 12 1221 MolCinna~y, Suita 4500 HOU$tOn, TCXD$ 77030 l3 (713) 951-6263 qgannnwayGbeekredden.com l4

16 ALSO PRESENT: 17 Cody Hall, Vidcogrllphor

0827 Paqe 102 now, I baliavo this is ona of the document& th;~.t w;u: p~odueed to you by ~. G~nawny. Could you look at the docwnQnt and confinn? • A. ~e3, ma'am. ThiG i~ one of the ones that I ~ecoived from -- from him, • Q. Okay. Let's tu~n to the second paq~ of thic document. It's Batec labeled 1338 at the bottom. Do you a sae that?

9 A.

the~e's " Q. And an e-mail which appearc to be from you to Patrick Sudduth at the bottom of that paqe. 12 A.

13 Q. Okay, !c this an e-~il from you to Patrick Sudduth?

A. " 16 Q. Okay. And i t is dated Septemb~r 15th, 2012; is l7 that correct?

18 A. That i~> co~~ect,

l9 Q. Okay. Would you road this e-mail out loud into tho :t:ecord?

21 A. It c~ys, "I c~aat11d. a databa&e u::inq thl! d.at.a that wo qot from PUblieData.com ucinq tho licenGo pl~toG

23 fl:om p;:~.rkod ca.rc-; at ou~ competition, Texnc 'l'itlc next door."

25 "I h;:~.ve about 20 nllmol:l and addre::;.:u:::; in

0828 Page 10.3 th~c datab~sc and ~11 h~ve liens on their title~ according to public data."

3 "I then created thill' fo:rzn lattox: :o.nd u::ad m4il merqe to merge in the names and addx:os::; information from tho EXCEL databa:u: to pe.t"sonali:::c the letter."

G ''I'm mailin9 thee~. out today."

7 "Todd."

8 Q. Okay. What do you remember, if anything, about Sl thiJ~: e-mail?

10 MR. til'\NNAl-m'!: obJect to form.

11 A. I remember that, as I'd ~lready testified on 12 cax:lior, I had been instructed to use the public databa~c

13 ~nd get the information to mail out. When I -- and if I 14 look on the datu on this a-nw.il, that lines up !lith the 15 date on the firl$t audit: where Patrick SO"Iy::; you're not 16 meeting your goO"Ils; ~ou'rc going to have to do more 17 marketing. And so I started doing that. It was 18 time-con:::Ulning tho original way that he had in::~tructed me 19 to do i t because you ~ould have -- get n~es and 20 info=ntion and I think at that time everybody elGc '!lao 21 just taking dollO n~cs and info~ation :o.nd then w~itinq

22 out an individ -- individuaLi:::ad letter to each 23 individual -- individual on there, Okay.

24 so all I -.ra" trying to convey -.rith thi~

25 eMmail wa" I've mO"Ide it a little bit oaniar by I eraatcd

0829 Page 104 a ~~croso~t EXCEL spreadsheet where I had on there the address and the city, state and :ip oodo. And then u~ed

J -~ saved that as a mini databa$o with all of that information and then ueod that in conjunction with Microsoft Word'~ rnerqe proor~ to then ~rqe in the n~~s

6 and info~tion just to mnko it simpler. So then you i only had to type out one letter, and it uuto~tically

8 enumerates i t with the correct narnee in hero instead o~

9 havinq to do i t -- ouch individual letter. And I was just tolling him of that part o£ tho idea. ll So just to clarify, that waG my idea. Tho idea of where to got that information is -- c~e ~rom

13 Patrick Sudduth.

14 Q. Uow, that EXCEL spreadsheet that you jul'lt testified about, did -~ did you leave that with Titlel".ax ' whun you loft?

17 A. Yes, ~·am. That was on tho computer that I lB waG usinq at the office.

19 Q. Okay. Wa~ there any policy to purqm that =ort of info:rmation while you were there?

21 HR. GJ>.NNA\>IJ'I.Y: Object to form.

23 Q. Dia you have a copy of that £XCEL spreadsheet?

24 A. no, ma'na. I didn't keep it.

25 Q. Okay. Was i t saved in any r.ort of onlin~

0830 Page 105 database?

A. I didn't nave it en any online database, no, ma'!UII..

~Aved ' Q, So you just it in a cocputo -- in one S single ~~mputcr; is that correct?

'· Ya~, m.D.'<UII.

• this •.

Q•

e-m~il Okay.

Yeah.

trail.

Did you ever e-mail it to anycn•?

l me;m, l think thie -- that. wa.!l Let me 1.1ee. Or maybe there wasn't an p;~rt of

10 attacluucl'lt. l*!.ybe he jui.IC said -- Ok;:~.y, No. Then I que!lla I didn't attil~h it.

12 With regards -- Going bacl<: to this e-mail, P;m.triok rcu::pond.~: and ha says, "Good idu11.. Do you mind sharing that with everybody," 15 So then I did ae he instructed, and I .~:hilred the -- I forwarded that e-mail then to everybody to qive everybody else the idea of using Microsoft Word's cerqe proqram with the Public Data. But I guess I did not actually include tha a~tachment or what I created on therll!.

21 Q. Wall, and I'm just --And l'~ as~inq about the spreadsheet becauec we have requested it, and we're told that it couldn't be found. So I'~ wonderinq i£ you have any concept as to where we miqht be able to find thnt 2S spread~hect?

0831 Paqe 106 1 >. Again, and I've been a~Y.ed th~t ~~e question now three times. I was anked that question ~hen the first L1.dy la\IYftl: c::dlii!d ~r.e a year ngo. I was a::ked that quention again when Mr. Gannaway talked to me.the other da.y, .And now, l'rn asked that quostion now. And it':; tho s~e response, which is it -- I had created i t , I ~aved i t on the cou~uter that was usinq at store office nureber 20. ~d I mean, I had no reason to take it with me. So I just I didn't. And so as far as I know when J: left, i t was still there on the computer that I wAs using at n~er 20.

12 Q, To your recollection, did you ever attach it to any e-mail or e-mail it to anybody so that i t might be saved in a server so~ewherc? " 15 >. I mean, hone.:~tly, I hAd thought that I -- attached it with thi~ e-mail trail, But obviou~ly, was wrong. so z =can, r don't -- I don't -- I guess I didn't.

Q. " Okay. And at the time you left, did this oprcadshect include all of the names of the prospective customers th~t you hnd gotten fro~ PublicData.com?

22 ~m. GANNAWAY: Object to form, 23 A. Yes, ~·am, it did. aut I need to clarify thnt i t wasn't only -~ that wasn't tho only place thoro's infoxmation, We also got information from, for instanca,

0832 Exhibit H

0833 NO. 2013-33584 WELLSHIRE FINANCIAL SERVICES, § IN THE DISTRICT COURT LLC, d/b/a LOANSTAR TITLE LOANS § and INTEGRITY TEXAS FUNDING, LP, § § Plaintiffs, § § v. § § OF HARRIS COUNTY, TEXAS TMX FINANCE HOLDINGS, INC.; § TMX FINANCE, LLC; § TMX FINANCE OF TEXAS, INC.; § TITLEMAX OF TEXAS, INC.; § FELIX DeLEON; § and ISHMAEL HERNANDEZ, § § Defendants. § 152"a JUDICIAL DISTRICT DEFENDANTS TMX FINANCE OF TEXAS, INC. AND TITLEMAX OF TEXAS, INC.'S RESPONSES TO PLAINTIFFS' FIRST REOUEST FOR PRODUCTION TO: Plaintiff Wellshire Financial Services, LLC d/b/a LoanStar Title Loans and Integrity Texas Funding, LP by and through their attorneys of record, Kent C. Sullivan, Daniel Johnson, and Robert A. Lemus, Sutherland Asbill & Brennan, LLP, 1001 Frumin, Suite 3700, Houston, Texas 77002; and Joseph D. Wargo, Wru·go French, LLP, 999 Peachtree Street, N.E. 26 111 Floor, Atlru1ta, Georgia 30309.

Defendants TMX Finance of Texas, Inc. and TitleMax of Texas, Inc. ("Defendants") hereby serve their Responses to Plaintiffs' Third Requests for Production.

\730.00001/5391 SS.vl

0834 Respectfully submitted, BECK REDDEN, LLP

By:.~~z_~~=======--= Day' . Beck (__....

State Bar No. 00000070 .,__ Geoff A. Gannaway State Bar No. 24036617 Bryon A. Rice State Bar No. 24065970 1221 McKim1ey Street, Suite 4500 Houston, Texas 77010 Tel: 713-951-3700 Fax: 713-951-3720 Email: [email protected] ggannaway@beckredden .com [email protected] ATTORNEYS FOR DEFENDANTS TMX FINANCE OF TEXAS, INC. AND T!TLEMAX OF TEXAS, INC.

1730.00001/5J9\55.vl 2 0835 CERTIFICATE OF SERVICE I hereby certify that I caused a true and correct copy of the foregoing instrument to be served on counsel of record in accordance with Rules 21 and 2la of the Texas Rules of Civil Procedure on this 4111 day of April, 2014, by email and facsimile:

SUTHERLAND ASBILL & BRENNAN, LLP Kent C. Sullivan Daniel Johnson Robeti A. Lemus Facsimile: (713) 654- I 30 I E-mail: [email protected] E-mail: daniel.j [email protected] E-mail: [email protected] WARGO & FRENCH, LLP Joseph D. Wargo Kenneth W. Stroud Jessica C. Casey Facsimile: (404) 853-1501 E-Mail: [email protected]

1730.00001/5391 SS. vi 3 0836 General Objections

1. Defendants object to the Instructions to the extent that they seek to place a burden upon Defendants greater than that provided by the Texas Rules of Civil Procedure.

2, Defendants reserve the right to supplement and/or amend its responses to these Requests for Production in accordance with the Texas Rules of Civil Procedure.

17JO.OOOO\fSJ91 SS.Vl 4 0837 RESPONSES TO REQUEST FOR PRODUCTION

REQUEST FOR PRODUCTION NO. 1: All contracts or agreements by and between any Defendant, on the one hand, and DataTrax, on the other hand, dated from September 1, 2011 to the present.

RESPONSE: Defendants object to this request as overbroad, unduly burdensome, and not reasonably calculated to lead to the discovery of relevant evidence. The request is not limited to matters relevant to this lawsuit, or to the timeframe relevant to this lawsuit. Defendants further object to the extent this request seeks information regarding contracts that might have been entered by persons or entities other than Defendants. Subject to those objections, none.

REQUEST FOR PRODUCTION NO.2: All contracts or agreements by and between any Defendant, on the one hand, and, The Source for PublicData LP (also known as PublicData), on the other hand, dated from September l, 2011 to the present.

REQUEST FOR PRODUCTION NO. 3: All emails by, received by, or otherwise in the inbox or deleted items folder for Todd Hale from September 1, 2011 to the present that refer or relate to visiting parking lots of any broker or provider of car title loans.

RESPONSE: Defendants object to this request as overbroad, unduly burdensome, and not reasonably calculated to lead to the discovery of relevant evidence. The request is not limited to matters relevant to this lawsuit, or to the timeframe relevant to this lawsuit. Defendants further object pursuant to TRCP 196.4 because they cannot through reasonable efforts retrieve the data or information requested. Subject to those objections, Defendants will run keyword searches to locate responsive documents related to Plaintiffs.

REQUEST FOR PRODUCTION NO. 4: All emails sent by, received by, or otherwise in the inbox or deleted items folder for Todd Hale from September 1, 2011 through the present that refer or relate to a "buyout" or refinance of any existing car title loans or loans held by entities other than TitleMax.

!730.0000!/53915~.vl 5 0838 RESPONSE: Defendants object to this request as overbroad, unduly burdensome, and not reasonably calculated to lead to the discovery of relevant evidence. The request is not limited to matters relevant to this lawsuit, or to the timeframe relevant to this lawsuit. Defendants further object pursuant to TRCP 196.4 because they cannot through reasonable efforts retrieve the data or information requested. Subject to those objections, Defendants will run keyword searches to locate responsive documents related to Plaintiffs.

REQUEST FOR PRODUCTION NO.5: All emails sent by, received by, or otherwise in the inbox or deleted items folder for Todd Hale from September 1, 2011 to the present that refer or relate to The Source for PublicData, LP (also known as PublicData), DatraTrax, or the Texas Department of Motor Vehicles ("DMV").

RESPONSE: Defendants object to this request as overbroad, unduly burdensome, and not reasonably calculated to lead to the discovery of relevant evidence. The request is not limited to matters relevant to this lawsuit, or to the timeframe relevant to this lawsuit. Defendants further object pursuant to TRCP 196.4 because they cannot through reasonable efforts retrieve the data or information requested. Subject to those objections, Defendants will run keyword searches to locate responsive documents related to Plaintiffs.

REQUEST FOR PRODUCTION NO.6: The spreadsheet or database used by Todd Hale and identified in the deposition of Patrick Sudduth in which Hale kept track of license plate numbers and other information on potential buyout or refinance customers.

RESPONSE: Defendants have not yet been able to locate the document, but will produce it if it is located.

REQUEST FOR PRODUCTION NO.7: All emails sent by, received by, or otherwise in the inbox or deleted items or deleted items folder for Ernest Page from September 1, 2011 to the present that refer or relate to visiting parking lots of any broker or provider of car title loans.

RESPONSE: Defendants object to this request as overbroad, unduly burdensome, and not reasonably calculated to lead to the discovery of relevant evidence. The request is not limited to matters relevant to this lawsuit, or to the timeframe relevant to this lawsuit. Defendants further object pursuant to TRCP 196.4 because they cannot through reasonable effmts retrieve the data or information requested. Subject to those objections, Defendants will run keyword searches to locate responsive documents related to Plaintiffs.

I730.00001(5391 55.vl 6 0839 REQUEST FOR PRODUCTION NO. 8: All emails sent by, received by, or otherwise in the inbox or deleted items folder for Ernest Page from September 1, 2011 through the present that refer or relate to a "buyout" or refinance of any existing car title loans held by entities other than TitleMax.

RESPONSE: Defendants object to this request as overbroad, unduly burdensome, and not reasonably calculated to lead to the discove1y of relevant evidence. The request is not limited to matters relevant to this lawsuit, or to the timeframe relevant to this lawsuit. Defendants fu1iher object pursuant to TRCP 196.4 because they cannot through reasonable efforts retrieve the data or information requested. Subject to those objections, Defendants will run keyword searches to locate responsive documents related to Plaintiffs.

REQUEST FOR PRODUCTION NO.9: All emails sent by, received by, or otherwise in the inbox or deleted items folder for Ernest Page from September 1, 2011 to the present that refer or relate to The Source for PublicData, LP (also known as PublicData), DataTrax, or the Texas Department of Motor Vehicles ("DMV").

RESPONSE: Defendants object to this request as overbroad, unduly bnrdensome, and not reasonably calculated to lead to the discovery of relevant evidence. The request knot limited to matters relevant to this lawsuit, or to the timeframe relevant to this lawsuit. Defendants further object pursuant to TRCP 196.4 because they cannot through reasonable efforts retrieve the data or information requested. Subject to those objections, Defendants will run keyword searches to locate responsive documents r~lated to Plaintiffs. ·

REQUEST FOR PRODUCTION NO. 10: All emails sent by, received by, or otherwise in the inbox or deleted items folder for Ishmael Hernandez from September 1, 2011 tlll'ough the present that refer or relate to a "buyout" or refinance of any competitor's existing car title loan or loans.

RESPONSE: Defendants object to this request as overbroad, unduly burdensome, and not reasonably calculated to lead to the discovery of relevant evidence. The request is not limited to matters relevant to this lawsuit, or to the timeframe relevant to this lawsuit. Defendants further object pursuant to TRCP 196.4 because they cannot tlll'ough reasonable efforts retrieve the data or information requested. Subject to those objections, Defendants will run keyword searches to locate responsive documents related to Plaintiffs.

1130.000011539155. vi 7 0840 REQUEST FOR PRODUCTION NO. 11: All emails sent by, received by, or otherwise in the inbox or deleted items folder for Ishmael Hernandez from September 1, 2011 to the present that refer or relate to The Source for PublicData, LP (also known as PublicData), DataTrax, or the Texas Department of Motor Vehicles ("DMV").

RESPONSE: Defendants object to this request as overbroad, unduly burdensome, and not reasonably calculated to lead to the discovery of relevant evidence. The request is not limited to matters relevant to this lawsuit, or to the timeframe relevant to this lawsuit. Defendants further object pursuant to TRCP 196.4 because they cannot through reasonable effm1s retrieve the data or information requested. Subject to those objections, Defendants will run keyword searches to locate responsive documents related to Plaintiffs.

REQUEST FOR PRODUCTION NO. 12: All emails sent by, received by, or otherwise in the inbox or deleted items folder for Felix DeLeon from September 1, 20 11 through the present that refer or relate to a "buyout" or refinance of any competitor's existing car title loan or loans.

RESPONSE: Defendants object to this request as overbroad, unduly burdensome, and not reasonably calculated to lead to the discovery of relevant evidence. The request is not limited to matters relevant to this lawsuit, or to the timeframe relevant to this lawsuit. Defendants further object pursuant to TRCP 196.4 because they cannot tlu·ough reasonable efforts retrieve the data or information requested. Subject to those objections, Defendants will run keyword searches to locate responsive documents related to Plaintiffs.

REQUEST FOR PRODUCTION NO. 13: All emails sent by, received by, or otherwise in the inbox or deleted items folder for Felix DeLeon from September 1, 2011 to the present that refer or relate to The Source for PublicData LP (also !mown as PublicData), DataTrax, or the Texas Department of Motor Vehicles ("DMV").

RESPONSE: Defendants object to this request as overbroad, unduly burdensome, and not reasonably calculated to lead to the discovery of relevant evidence. The request is not limited to matters relevant to this lawsuit, or to the timeframe relevant to this lawsuit. Defendants further object pursuant to TRCP 196.4 because they cannot through reasonable efforts retrieve the data or information requested. Subject to those objections, Defendants will run keyword searches to locate responsive documents related to Plaintiffs.

! 730.00001/S391SS.v1 8 0841 REQUEST FOR PRODUCTION NO. 14: All ema:ils sent by, received by, or otherwise in the inbox or deleted items folder for Michael Ryan from September 1, 20 II through the present that refer or relate to a "buyout" or refinance of any existing car title loan or loans held by entities other than TitleMax.

RESPONSE: Defendants object to this request as overbroad, unduly burdensome, and not reasonably calculated to lead to the discovery of relevant evidence. The request is not limited to matters relevant to this lawsuit, or to the timefl·ame relevant to this lawsuit. Defendants further object pursuant to TRCP 196.4 because they cannot through reasonable efforts retrieve the data or infonnation requested. Subject to those objections, Defendants will run keyword searches to locate responsive documents related to Plaintiffs.

REQUEST FOR PRODUCTION NO. 15: All emails sent by, received by, or otherwise in the inbox or deleted items folder for Michael Ryan from September 1, 2011 to the present that refer or relate to The Source for PublicData, LP (also known as PublicData), DataTrax, or the Texas Department of Motor Vehicles ("DMV").

RESPONSE: Defendants object to this request as overbroad, unduly burdensome, and not reasonably calculated to lead to the discovery of relevant evidence. The request is not limited to matters relevant to this lawsuit, or to the timeframe relevant to this lawsuit. Defendants further object pursuant to TRCP 196.4 because they cannot through reasonable efforts retrieve the data or information requested. Subject to those objections, Defendants will run keyword searches to locate responsive documents related to Plaintiffs.

REQUEST FOR PRODUCTION NO. 16: All emails sent by, received by, or otherwise in the in box or deleted items folder for Rad Casillas from September 1, 2011 through the present that refer or relate to a "buyout" or refinance of any existing car title loan or loans held by entities other than TitleMax.

RESPONSE: Defendants object to this reqnest as overbroad, unduly burdensome, and not reasonably calculated to lead to the discovery of relevant evidence. The request is not limited io matters relevant to this lawsuit, or to the timeframe relevant to this lawsuit. Defendants futther object pursuant to TRCP 196.4 because they cannot through reasonable efforts retrieve the data or information requested. Subject to those objections, Defendants will run keyword searches to locate responsive documents related to Plaintiffs.

1730.0000 I/Sj9]55.vl 9 0842 REQUEST FOR PRODUCTION NO. 17: All emails sent by, received by, or otherwise in the inbox or deleted items folder for Rad Casillas from September 1, 2011 to the present that refer or relate to The Source for PublicData, LP (also !mown as PublicData), DataTrax, or the Texas Department of Motor Vehicles ("DMV").

RESPONSE: Defendants object to this request as overbroad, unduly burdensome, and not reasonably calculated to lead to the discovery of relevant evidence. The request is not limited to matters relevant to this lawsuit, or to the timeframe relevant to this lawsuit. Defendants fmther object pursuant to TRCP 196.4 because they cannot through reasonable efforts retrieve the data or information requested. Subject to those objections, Defendants will run keyword searches to locate responsive documents related to Plaintiffs.

REQUEST FOR PRODUCTION NO. 18: All emails sent by, received by, or otherwise in the inbox or deleted items folder for James Batterson from September 1, 2011 through the present that refer or relate to a "buyout" or refinance of any existing car title loan or loans held by entities other than TitleMax.

RESPONSE: Defendants object to this request as overbroad, unduly burdensome, and not reasonably calculated to lead to the discovery of relevant evidence. The request is not limited to matters relevant to this lawsuit, or to the timeframe relevant to this lawsuit. Defendants further object pursuant to TRCP 196.4 because they cannot through reasonable efforts retrieve the data or infonnation requested. Subject to those objections, Defendants will run keyword searches to locate responsive documents related to Plaintiffs.

REQUEST FOR PRODUCTION NO. 19: All emails sent by, received by, or otherwise in the inbox or deleted items folder for James Batterson from September 1, 2011 to the present that refer or relate to The Source for PublicData, LP (also known as PublicData), DataTrax, or the Texas Department of Motor Vehicles ("DMV").

RESPONSE: Defendants object to this request as overbroad, unduly burdensome, and not reasonably calculated to lead to the discovery of relevant evidence. The request is not limited to matters relevant to this lawsuit, or to the timeframe relevant to this lawsuit. Defendants further object pursuant to TRCP 196.4 because they cannot through reasonable efforts retrieve the data or information requested. Subject to those objections, Defendants will run keyword searches to locate responsive documents related to Plaintiffs.

1730.0000115391 SS.vl 10 0843 REQUEST FOR PRODUCTION NO. 20: All documents referring or relating to divisional meetings held by You from September 1, 2011 to the present, including but not limited to meeting minutes and itineraries. This request is limited to those divisional meetings involving the stores identified in Your response to Intenogatory No. 1 of Plaintiffs' Second Set oflnterrogatories, served concurrently herewith.

1130.000G \/5391 SS.vl 11 0844 Exhibit I

0845 Page 1 CAUSE NO. 2013-33584 WELLSHIRE FINANCIAL ) IN THE DISTRICT COURT SERVICES 1 LLC 1 d/b/a ) LOANSTAR TITLE LOANS ) and INTEGRITY TEXAS ) FUNDING 1 LP 1 ) Plaintiffs, ) ) vs. ) OF HARRIS COUNTY 1 TEXAS ) TMX FINANCE HOLDINGS 1 ) INC.; TMX FINANCE 1 LLC; ) TMX FINANCE OF TEXAS 1 ) INC.; TITLEMAX OF TEXAS 1 ) INC; FELIX DELEON; and ) ISMAEL HERNANDEZ 1 ) Defendants. ) 152ND JUDICIAL DISTRICT ORAL VIDEOTAPED DEPOSITION FELIX DELEON June 24 1 2013

ORAL VIDEOTAPED DEPOSITION OF FELIX DELEON 1 produced as a witness at the instance of the Plaintiffs and duly sworn 1 was taken in the above-styled and numbered cause on June 24 1 2013 1 from 2:53p.m. to 3:21 p.m. 1 before Teresa Saucier 1 Certified Shorthand Reporter in and for the State of Texas 1 reported by computerized stenotype machine at the offices of Sutherland Asbill & Brennan 1 1001 Fannin 1 Suite 3700 1 Houston 1 Harris County 1 Texas 1 pursuant to Notice and the Texas Rules of Civil Procedure.

Carlisle Reporting 713-864-4443

0846 Page 2 ~ APPEARANCES FOR THE PLAINTIFFS: 4 MR. JOSEPH WARGO (VIA TELEPHONE) WARGO FRENCH, LLP 5 999 Peachtree Street, N.E., 26th Floor Atlanta, Georgia 30309 FOR DEFENDANTS TMX FINANCE OF TEXAS, INCORPORATED AND TITLEMAX OF TEXAS, INCORPORATED: 9 MR. GEOFF GANNAWAY BECK REDDEN ~0 122~ McKinney Street, Suite 4500 Houston, Texas 77010 ~~ Telephone: 7~3 95~-6263 E-mail: [email protected] ~2 and MR. STEPHEN T. LABRIOLA 13 FELLOWS LABRIOLA Peachtree Street, NE 14 Suite 2300, South Tower Atlanta, Georgia 30303 15 Telephone: 404 586-9200 E-mail: [email protected] FOR DEFENDANT ISMAEL HERNANDEZ: 18 MR. REECE RONDON HALL MAINS LUGRIN, PC 19 2800 Post Oak Boulevard, 64th Floor Houston, Texas 77057 20 Telephone: 713 871-9000 E-mail: [email protected] FOR DEFENDANT FELIX DELEON: 23 MS. CHRISTINA A. BRYAN SMYSER KAPLAN & VESELKA, LLP 24 700 Louisiana, Suite 2300 Houston, Texas 77002 25 Telephone: 713 22~-2345 Carlisle Reporting 7~3-864-4443

0847 Page 3 1 APPEARANCES (Cont.)

3 ALSO PRESENT: 4 Mr. Nicholas D'Angelo (Videographer)

Carlisle Reporting 713-864-4443

0848 Felix DeLeon - June 24, 2013 Examination by Mr. Wargo Page 12 1 A. I invoke my Fifth.

2 Q. You were aware, were you not, that you could not search the Datatrax database for purposes of discovering customers of your competitors so that you could then solicit those competitors?

6 MR. GANNAWAY: Object to form.

7 MS. BRYAN: Form.

8 A. I invoke my Fifth.

9 Q. Do you understand that in order to search the Datatrax database, you were required to certify that you were using the data for a permissible purpose, correct?

13 MR. GANNAWAY: Object to form.

14 A. I invoke my Fifth.

15 Q. Did you provide such a certification?

16 MS. BRYAN: Form.

17 A. I invoke my Fifth.

18 Q. What certification did you provide to Datatrax?

20 MS. BRYAN: Objection, form.

21 A. I invoke my Fifth.

22 Q. You did certify to Datatrax, did you not, sir, that you would not use information that you obtained from Datatrax to solicit customers?

25 A. I invoke my Fifth.

Carlisle Reporting 713-864-4443

0849 Felix DeLeon - June 24, 2013 Examination by Mr. Wargo Page 13 1 Q. Isn't it true, sir, that you have searched the Datatrax databases for information related to Loanstar or Integrity customers?

4 MS. BRYAN: Form.

5 A. I invoke my Fifth.

6 Q. When did you perform such a search for the first time?

8 MS. BRYAN: Objection, form.

9 MR. GANNAWAY: Form.

10 A. I invoke my Fifth.

11 Q. How many customer how many customers did you identify throughout all of the searches that you've done of the Datatrax database related to Loanstar or Integrity?

15 MR. GANNAWAY: Objection, form.

16 MS. BRYAN: Objection, form.

17 A. I invoke the Fifth.

18 Q. Approximately how many customers did you identify per search of the Datatrax system?

20 MR. GANNAWAY: Object to form.

21 MS. BRYAN: Objection, form.

22 A. I invoke the Fifth.

23 Q. Is i t true -- i t is true, is i t not, sir, that you performed such searches of the Datatrax system within the scope of your employment with

Carlisle Reporting 713-864-4443

0850 Felix DeLeon- June 24, 2013 Examination by Mr. Wargo Page 14 TitleMax?

2 MR. GANNAWAY: Object to form.

3 A. I invoke the Fifth.

4 Q. What searches did you perform on the Datatrax system -- I'm sorry, on the Datatrax database that was, in any way, related to Loanstar or Integrity customers?

8 MS. BRYAN: Objection, form.

9 A. I invoke the Fifth.

10 Q. Did you do a search for the Austin, Texas area related to Integrity or Loanstar customers on the Datatrax database?

13 MR. GANNAWAY: Object to form.

14 A. I invoke the Fifth.

15 Q. Did you do a search for Integrity or Loanstar customers in the Dallas area on the Datatrax database?

18 MR. GANNAWAY: Object to form.

19 A. I invoke the Fifth.

20 Q. Did you do a search on the Datatrax database for Loanstar or Integrity customers in the Houston, Texas area?

23 MR. GANNAWAY: Object to form.

24 A. I invoke the Fifth.

25 Q. Did you target specific area codes or zip

Carlisle Reporting 713-864-4443

0851 Felix DeLeon - June 24, 2013 Examination by Mr. Wargo Page 15 codes in any search of.the Datatrax database system?

2 MR. GANNAWAY: Object to form.

3 MS. BRYAN: Form.

4 A. I invoke the Fifth.

5 Q. Did any of your bosses or superiors instruct you to perform any search of the Datatrax database?

8 A. I invoke the Fifth.

9 Q. Who instructed such a search?

10 MS. BRYAN: Objection, form.

11 MR. GANNAWAY: Object to form.

12 A. I invoke the Fifth.

13 Q. Sir, did you obtain any reports containing 14 the names of Loanstar or Integrity customers as a 15 result of a search of the Datatrax database?

16 MR. GANNAWAY: Object to form.

17 MS. BRYAN: Objection, form.

18 A. I invoke the Fifth.

19 Q. Sir, it's true that you solicited customers 20 on behalf of TitleMax using information that you 21 obtained from the Datatrax system?

22 MS. BRYAN: Form.

23, MR. GANNAWAY: Object to form.

24 A. I invoke the Fifth.

25 Q, Sir, it's true that you solicited customers

Carlisle Reporting 713-864-4443

0852 Felix DeLeon - June 24, 2013 Examination by Mr. Wargo Page 16 in order to make more money, those customers being Loanstar or Integrity customers, that you identified from the Datatrax database?

4 MR. GANNAWAY: Object to form.

5 MS. BRYAN: Form.

6 A. I invoke the Fifth.

7 Q. Sir, it's true that you solicited over a hundred customers using the Datatrax database that you identified let -- let me rephrase that, please.

11 Sir, it's true that you solicited using the Datatrax data -- database over a hundred customers who, in fact, were Integrity and Loanstar customers?

15 MS. BRYAN: Form.

16 MR. GANNAWAY: Object to form.

17 A. I invoke the Fifth.

18 Q. Sir, you sent letters and flyers to customers you identified through the -~ the Datatrax database. Isn't that true?

21 MS. BRYAN: Objection, form.

22 MR. GANNAWAY: Object to form.

23 A. I invoke the Fifth.

24 Q. And those customers were customers who were Integrity or Loanstar customers, were they not?

Carlisle Reporting 713-864-4443

0853 Paqe l NO. 20J.J-J3SB4 WELLSHIRE FINANCIAL IU THE DISTRICT COURT SERVICES, LLC, D/B/A LOJUIS"rt\R TITLE LOANS Pt..>m IN'l'EGRI'l'~ TEXAS FUNDING, LP, Plaintiffs, vs. HARRIS COUN'TY, TEXAS TMX FINANCE HOLDINGS, INC.; TWX FINANCE, LLC; 'l'HX Fiw.NCE OF 'l'EXAS 1 INC. ; 'XITLEMAX OF TEXAS, INC. ; FELIX DELEON; AND IS~L HERNANDEZ, Dc:fcndanto, 152NO JUDICIAL DISTRICT

ORAL ANO ~OEOTAPEO DEPOSITION OF LUCIA GRA.JEDA June 27, .2013

ORAL AND VIDEO'l'AFED DEPOSITION OF LUCIA GRAJEDA, p~oduced a~ a witne~s at the instance of the PlAintiffs, and duly sworn, was t~ken in the nhovo-stylGd and numbered cause on the 27th of June, 2013, from 10:19 a.a. to 12:53 p.m., before Heidi Morrison, CSR, RPR, Certified Shorthand Reporter in and for the State of Texas, reported by computerized stenotype machine at tho offices of Weisbart Sprin9cr Hayes, LLP, .212 Lavaca Street, Suite 200, Austin, Texas 7B70J., pursuant to the Texas Rules of Civil Procedure and the provisions stated on tho record or attached hereto.

0854 1 APPE.l\.RANCES

3 FOR THE PLAINTIFFS: 4 Ml:. Kenneth w. Stroud WMIGO FRENCH 5 999 Pa.a.chtrce Strcut, NE 26th Flocu: 6 Atlnnta, Georgia 30309 Telephone: (404) 853-1500 7 Fax: (404) 853-1569 E-mail: k~troud~warqofrench.com • FOR THE DEFENOAN'l' LUCIA GRI\Jl'.:OA: ' Mr. Tim Cleveland 10 WEISBAR'l' SPRINGER Hl\YES, LLP Lavaca Street, Suite 200 11 Au:;~tin,Taxa:; 78701 Talaphona: (512) 652-5780 12 Fax: (512) 682-20?4 E-mail: tclevelandGw~hllp.com FOR THE DEFENDANTS 'l'HX FINANCE OF TEXAS 1 INC. 1 lllTO TIT!.EM1>.X OF TEXAS, INC. : 15 Mr. Bryon A, Rice SE:Cll: REDDEN 16 1221 McKinney St. , Sui to 4500 Hou~ton,Texas 77010 17 Telephone: (713) 951-6256 Fax: (713) 951-3720 18 E-mail: brice[!bcckredden. com ALSO PRESENT: 20 Cody Hall, Videographer Sarah Sibley

0855 Page 16 1 MR. CLEVELAND: I:;; that ~groeable?

2 MR. STROUD: That's ~gr~oable, yos.

3 {By Hr. Stroud) As a qaneral Danagcr, did you l<ork with Michael Ryan?

5 MR.. RICB: Object to :fOJ:lll, 6 A r plead tho Fifth.

7 Q Do you know who Michael Ryan is?

:tas. ' A 9 Q 'lol'llat is Hichaol Ryan•:: po::;ition at 'l'itlo.."iax?

10 A I plead tho Fifth, 11 Q Was he your 3uperviGor?

12 A I plead the Fifth.

13 Q What stores did Michael Ryan oversee?

14 A I plead the Fifth.

15 Q Did he oversee your store?

16 A I plead the Fifth.

17 Q Axe you f~~liar with a co~pany called tlata'I'rack:~?

19 A I plead the Fifth.

20 Q Oid you ever obtain an account with oata'I'racks?

22 A I plead the Fifth.

23 Q Have you nvar aecessod a database maintainod by Data'I'racks? " 25 A I plead the Fifth.

0856 1 Hav~ you avex ~ccossud a d~t~a~o maintained by DataTxacks on a cODputer that is ownud or ~intainad by TitlcHax?

I plead the Fifth. ' ' 5 Q Have you ever accessed a database maintained by Data~rncXs for a co~put~r -- on a personal coDputer?

7 A I plead the Fifth.

Rave you over maintained -- have you ever ' ~ performed a search on a database maintained by DataTracks on any other computers?

11 A I plead the Fifth.

12 Q Rave you ever perfo~cd any searches from the Texas Depar~ent of Motor Vehicle recor~?

14 I plead the Fifth. ' 15 Q okay. Have you ever searched any datnbasu ~intaining DMV records for the pu~osas of -- of locatinq customers of competitors?

18 A I plead the Fifth, 19 Q Have you ever searched any dat~asc,

20 including, but not limited to, DataTrack~.

2~ PublicData com, or the Taxa~ o .. partment of Moto~ Vehic~e

22 record~ fo~ the purpoGe of Locating or identifyinq the name~ of cu~tomer~ of the plaintiffs in this case, Wellshire Financial, doinq business as Loanst~r TitLo Lo~s or rntegrit~ Texas Funding?

0857 Pago 18 1 MR. CLEVELP.ND: Obj<l'ction -- 2 A I plead. the Fifth, 3 MR. CLEVE~tO: Ol:d~cti•;m; fo~.

(By Mr. Stroud) Axe you fAmdliar with who ' Q S LoanStar Title Loan~ i~?

6 MR. CLEVE~m: Hang on a ~oeond.

7 I inctruct you not to anGwor on Fifth a Amendment qround~.

9 A I plead tho Fifth.

10 Q (By Mr. Stroud} Are you £~liar with who 1~ Integrity Texa5 Funding iG?

12 A I plead the Fifth.

13 Q Havo you ever acce,scd a database containing DMV records and then used the %carch results that wero obtained to mail solicitations to tho people idontifiod on the search?

17 A I plead the Fifth.

18 Q Have you ever searched OataTracks for the n~es of customers o£ Loans tar Title Loans or Integrity Texas Fundinq?

21 A I plead tho Fifth, 22 Q Have you ever searched OntnTraoku by a lienholder, spc~i~i~~lly limited to Integrity Tcx~o Funding?

25 A I pload the Fifth.

0858 Page 1 CAUSE NO. 20~3-33594

WELLSHIRE FINANCIAL IU THE DISTRICT COUR~ SERVICES, LLC, d/b/a L01illS'l'AR 'l'I~LE LOXUS and INTEGlU't~ TEXAS FUNDING, LP, P1a:intiff~,

OF HARRIS COUNTY, TEXJI.S 'lMX FIUANC£ HOLDINGS, INC,,· 'l'MX FINliNCE, LLC; 'niX FltiANCE OF TEAAS, INC.; TI'l'LEHAX OF TEXAS, ltiC; FELIX DELEON; and ISMAEL HERt~A."lDEZ, Defcmdants. 152ND JUDICIAL DISTRICT

ORAL VIDEOTAPED DEPOSITION !SHM:L HEIUlANO:E:Z June 24, 2013

ORAL VIDEOTAPED DEPOSITION OF ISM7>.EL HERliANDEZ, produced as a ~itnes~ at the instance of the Plaintiff" and duly sworn, unu taken in the above-styled and numbered cause on June 24, 2013, from 1:52 p.m. to 2:40p.m., before Teresa saucier, Certified Shorthand Reporter in and for the State of Texas, reported by computerized stenotype machine at the offices of Sutherland Asbill ' Brennan, 1001 Fannin, Suite 3700, Houston, Harris County, Texas, pursuant to Notice and th• Taxas Rules of Civil Procedure.

0859 Paqe 2 1 APPSARJ\liCES

3 FOR THE PLAINTIFFS: 4 MR. JOSEPH Wl\RGO (VIA TELEPHONE) Wl\RGO FRENCH 1 LLP 5 999 Pc;~chtree St:r.:cct, N.E,, 26th Floor Atl~nta, Goorqia 30309 ' FOR DEFENDANTS TMX FlRhNCE OF TEXAS, INCORPORA~ED AND TITLE!.~ OF TEXAS, INCORPORATED: 9 HR, GEOFF GANNAWAY BECK REDDEtl 10 1221 McKinney Street, Suita 4500 Houston, Texas 77010 11 '!'elcphonc: 713 951-6263 E-mail: qqannawayQbcckrcddcn.eom 12 and MR, S!l'EPHEU T. IJI.BRIOLA 13 FELLO'I~S IJ\BR:IOLA Peachtree Street, NE 14 Suite 2300, South Tower Atlanta, Georgia 30303 15 Telephone: 404 586-9200 E-mail: slabriola2fellab.com " 17 FOR DEFEUDANT ISHI\EL HERll1.NDEZ: 18 MR. REECE RO~IDO!t HALL ~.£ZI.INS LUGRIU 1 PC 1!1 2800 Post 03.k Boulevard, 64th Floor Houston, Texas 77057 20 Tclephon~~:: 713 071-9000

22 FOR DEFENDANT FELIX DELEON: 23 MS. CHRISTINA A. BRYJUl SM'iSElt KAPLAN G VESELKA, LLP 24 700 Loui.IJiana, Suito 2300 Houston, Texas 77002 25 Telephone: 713 221-2345

0860 Page 3 1 APPEJI.RAl<CES {Cont.)

3 ALSO PRE SEN 'I': 4 Mr. Nichola~;: D'Angelo (Vidnographar) Mr. Felix DeLeon

' '

l6 l?

0861 Page 11 1 MR, RONDON: "ie:;, I am, 2 HR. 1.;}1.RG0: And, Chz:-is, I'm sorry.

3 You uro as ~ell?

4 MS. BRYAN: I have no objection to S that. Yes. I'm comfortable with that.

6 Mit. G,l\lrnAWAY: And -- and, I que10s, Mr. Wargo, I'd ask are you comfortable with that a: sufficiently invoking his Fi,th Amen~ent rights?

MR. WXRGO: I -- I ~- I£ av~ryona's ' in agrce~ent, I ~. Thank you.

11 Q. Mr. Hernando:, could you tell me whether you pz:-ovided any docu=ents to any attorneys other than your counuel, Reece, in this case?

14 MR. RONDON: Give me one second real lS quick, Joe.

16 MR, WARGO: Yas.

17 HR. RONDON: Joe, we can talk nbout that later, if you like. Jl.nd I -- I cAn -- I'll qivc you frank and open answers to that. But, v~. Hernandez, I'Q qoing to ask you to plead the Fifth?

22 A. I plead the Fifth.

23 Q. Sir, h~s unyone at any ti~o -- at any timo a~ked you to ~hred or d~sposQ of any information that you bQlieve i~ somehow reLated to tho litigation?

0862 Page 12 ' A, J: plc;:~od. the Fifth.

Do you have ~ny ~nform~tion or ' Q.

3 documentation in your pos~cGsion that you believe is 4 relevant to thi~ litigation?

5 A, plead tho Fifth.

Sir, at any tiree, did you enter' into a ' Q.

7 contract with Oatatrax on your behalf or on behalf of 8 TitleMax?

I plead the Fi~th. ' A. lO o. Sir, if you entered into a contract, when 11 did you do so? l2 MR. RONDON: I'm going to object to 13 form. l4 A. I plead the Fifth. l5 Q. Sir, have you ever falsely identified 16 your$elf to Datatrax? l7 A. I pl1111d thu Fifth.

Have you over fal$elY identified your$elf " Q.

19 to 'l'itloMax?

20 A. I ploud the Fifth.

21 Q. Did you ever obtain any info=tion fro!Il 22 Datatrax?

23 A. I plead the Fifth.

24 Q. Did you ever obtain any info.!:ltation from 25 DatatraK that ua::: subsequently used by anyone .,

0863 page 13 Ti tleM.ax?

2 MR. RONDON: Objection, fol:lll, 3 MS. BRYAN: Objection, form, • A. I plead the Fifth .

5 Q. D~d you eva~ obtain any infor.mation fro~

6 Datntrax that, to you~ kno~ledge, was subsequently ~sed by other people at TitleMax?

B MR. GlillNAWhY; objcet to fo:nn.

A. I plead the Fifth.

10 Q. Sir, did you ever provide any certification to Datatrax that information you were obtaining from Datatrax would be u~ed for a proper purpo=o?

13 A. I plead the Fifth.

Q. Could you tell me what proper purpose you " stated to Datatrax in pulling the information?

16 MR. RONDON: Object to for.m.

17 A. I plead the Fifth.

1B Q. Ara you aware of the fact that you cannot obtain information fro~ Datatrax without certifying that the information is beinq obtained for a propar purpose?

22 MR, GANNl\WhY: obj oct to form.

23 }m, RONDON: Object to form.

2< A. I plead the Fifth.

25 Q. Did you ever certify to Datatrax that you

0864 ~ere pulling informat~on from it~ database for any

3 .. purpot:e at all?

I plead the Fifth . • Q. Sir, are you aware of tho fact that 5 obtaining information from Datatrax for -- for pu~oses o£ soliciting customers was an improper 7 purpo10e? a MS. BR~AN: Objection, fo~.

a MR. GJ\NNJ\HAY: object to form.

10 A. I pleaa the Fifth.

H Q. When you obtained information from 12 Datatra~, did you u~e that info~ation a~ an employee lJ of TitleMax?

14 MR. RONDON: Objection, fo~.

15 MS. BRYAN: Objnction, form, 16 A. plead the Fifth.

17 Q. Did you uso any Datatrax information to 19 solicit customers that were Integrity customers?

•.

MR. RONDON: I plead the Fifth .

Objection, fon~.

Did you ever search the Datatrax databases 22 for information that was related in any way to either 23 Loanstar or rnte9rity?

20 A. r plead the Fifth, 25 Q. When did you per£o~ your fir:t so•rch

0865 Page 15 se~king inforw~tion rulated to Loun~~a~ or Integrity?

2 MS. BR~AN: Objection, form.

3 MR. RONDON: Objeetio:.n, f<=lrt:'l,

4 A, x plead the Fifth.

5 Q. When did you pu~fo~ your fi:~t search G u~ing Datatr~ databa~cs for informntion related to Loansta~ or Integrity?

Objection, !"ore. ' MR, GJI..NN11.WAY: MS. BRYAN: Objection, fo~. ' 10 HR.. RONDON: Objection, form. ll A. plond tho Fifth.

12 Q. Row many cu~tomers did you identify -- I'm sorry. Let me start thut over again.

14 Row many Integrity or Loan~tar

15 cu:~tomers did you identify through Oat.:ltrax searcheto?

16 MR. GANNA~Y: Objection, form.

17 MS. BRY~r: Objection, form. l8 MR. RONDON: Objection, form.

10 A. I plead the Fifth.

20 Q. How often did you perform a search of the Datatra~ database fo~ Lo~nstar or Int~qrity

22 cuGtomers?

23 MR. RONDON: Objection, form.

24 A, I plead the Fifth.

25 MR. WARGO: What is the fo~

0866 Paqe 16 objection?

2 MR. RONDON: C~n you ~npnat thn question, please? • MR. ~GO: Would you re~d baok the qu~rstion?

MR. RONDON: Yeah. I'm askinq he~ to. ' 7 (Xhe record was ~ead as ~oquc~ted.)

• MR. RONDON: It assume~ fact~ not in evidence.

10 Q. On average, how ~any differunt eusto~a~&

11 informntion did you obtain in any search that you perfo::med?

13 MR. GANNA'WAY: Object to fo:t:m, 1< A. plead the Fi~th.

15 Q. Did you eve~ run searche& where the results cominq buck were greater than 100?

17 MR. GANNAWAY: Object to form.

19 A. pl~rad the Fifth.

19 Q. Did you perform all of these searehea within the scope of your ~ployment at TitleMax?

21 MR. GAHNAWJI.'l: Object to fo:t:m.

22 A. I plead the Fifth.

23 Q. Did you perfo:t:m the:e sea~ches at the direction of anyone else at Titl~x?

25 MR. G)UINM1l\Y: Object to form.

0867 Page 17 1 A. I plead the Fifth.

2 Q. Sir, did you evar perform an~ ~oaxch of a Datatra~ databa~a specifically seeking customar information of vehicles encumbered by liens made by Integrity?

6 A. I plead ~~e Fifth.

7 Q. Sir, have you aver ~eurehad the Datatrux databa~e by licen=e plate number?

9 MR. GA."m1'.H1\Y: Object to fo:t:'lll.

10 A. I plead the Fifth, 11 Q. For any searches you performed on Datatrax's database for either Loanstar or Integrity customers, what geographic areas did you search for?

14 Hl\. ROUDON: Objeet to fort~~.

15 MS. BRYA.'l: Form, 16 A. I plead the Fifth. l7 Q. Did you ~vcr seek information concerning Integrity customers in the Austin, Texas area? l9 A. I plead the Fifth.

20 Q, Did you ever seek information concerning 2l In£eqrity cuato=er# for the Dallas, Texa~ a~ea?

22 HR. GJ>.NNAWJI.'i: Object tc fo.z:m.

23 A. ~ plead the Fifth.

24 Q. Oid you ever ~cek information f~om

25 Datat~ax•s database fo~ Inteq~ity custo~ers in the

0868 Page 18 HOUGton, TCX.tl!l i\l:Oll.?

2 MR. GANNAW1\.Y: Object to forn..

'· I plend the Fifth.

HR. WARGO: Wa..z: thora an objection to for.n?

6 HR. GJ\NN'Al>ll\Y: The.~:c wan .

7 HR. HARGO: Whnt is the objection?

8 MR. GANNAWAY: It':; vaque and Sl ambiguous.

10 MR. W~GO: As to what te=ro or phra:;o?

11 MR., GANNAWAY: N:: to ..,hotho::< he :t'iiO 12 :;ca:t"chc:; in tho Houston aran. It':; u vaquo and 13 ambiguou!l to~ and -- and i:; equally susceptible to 14 permis!lible pu:t"pO!IC senrches.

15 Q. Sir, did any of your superiorn o.~: bosson 16 in!lt::ouct you to perform senroho!l of any kind on the 17 Datatrax databa.z:o? lB

HR., GJ\NlTAW1\.Y: I plcnd the Fifth.

Object to form.

Who in:;t.uoted you to perform .z:uch 21 :~carche:;?

22 MS. BRYAll': Objection, form.

'· I plead the Fifth.

24 Q. Did you obtain reports containing the n~o.!l

0869 Page 19 a ~earch of the Datntrax d~tab3se?

MS. BRY~J: Objection, form. ' 3 MR. G~lAWAY: Object to form. • A. I plo~~ tho Fifth.

5 Q. Sir, what did you do with the names of G Loans tar or Integrity cu~torner~ that you received from Dntatrax Genrches?

9 ~m. RONDON: Object to form.

9 MS. BRYAN: Objection.

10 A. l plead the Fifth.

11 Q. Sir, isn't i t true that you solicited Lonnstnr or Integrity customers using information you obtained from Dntatrax datubnse searches?

Q. ~m. GANNAWAY: plead the Fifth .

Object to form,

Isn't i t true, sir, that you solicited over a hundred such Loanstar or Integrity customers?

Q. ~m. GANNAWAY: plead the Fifth.

Object to form.

Isn't it true that you solicited over a hundred such Integrity or Loanstar customers usinq info~tion you ~aceivad f~om 4 Datat~ax databa~c

23 search?

24 MR. GANNA~Y: Object to fo~.

25 A. P~e~d tho Fifth,

0870 Page 20 l Q. Isn't i t t~u~, ~ir, that you ~ent letter~

2 and flyerc offering- to buy out existing loans held by Int:eqrity using Datntra.x da.ta.buu infor=tion?

4 Mn, RONDON: Objection, form.

5 A. I plead the Fifth,

' Q. Isn't i t true, sir, that you sent over a hundred buyout letters to Loanstnr and Integrity customers using Oatatrax database information?

' MR. Gh.'mAWAY: Object to for.n.

10 A. I plead the Fifth. ll Q. Isn't i t true that you nrc n~-rare of Loanstar or Inteqrity customers who stopped doin9 business with Lonnstar or Integrity and started doing business with ~itlaMax as a result of your finding their n~es on Datatrax and sending buyout letters or other solicitations to those customers?

17 MR. GAl:mAW11.'!: Object to fo=. lS A. I plead the Fifth.

19 Q. Isn't i t true th~t the do11~r amount of 1oan:; fo:: cu:!ltomers that 'l'it1cHa.>r. --I'm. :~orry, that you ~witched over from Lonnst~r or Inteqrity to Tit18Max wa~ in exces~ of $10,000?

23 HR. GJUruAWI.Y: Object t.o form.

24 A. I plond tho Fifth.

25 Q. Isn't. i t t.rue that. tho do1l~r amount of

0871 Paql! 21 loans for customers that you sw~tcheC over from Loan~tar or Integrity to TitluV~x exceeded $SO,OOO?

3 MR. GANNM<A"t: object to :form.

A. plead the Fifth. ' I 5 Q. And for purposes of thoso last two que~tions, I'm r~ferrinQ to cu=tom4rn that you switched over usin9 in~ormation obtained from a searches of the Datafax -- Datatrax database.

9 HR. RONDON: I'= sorry, Joe. Was that a question?

11 MR. WARGO: Yms.

12 Q. Do you undorst~d my queGtion?

13 HR. GJ>.N:ttAWA'l: Object to form.

" rephrase, p1e~se?

MR. RONDON: Would you -- would you

Q. Okay. Mr. Hernandex, isn't i t true th~t

17 the dollar amount of loans for customers that you switchQd ovor from Loanstar or Integrity to TitlaMnx using info~tion obt~nod from Datatrnx was in eXCC55 of $50,000?

Object to form. " MR. GJ>.NllAWJ\.Y: 22 A. I plead the Fifth.

23 Q. The same question. Waa i t in excesn of $100,000?

25 MR. GANNAWAY: Sarno objection.

0872 CAUSE NO. 2013-33584

WELLSHIRE FINANCIAL • IN THE DISTRICT COURT SERVICES, LLC, d/b/~ LONES'l'AR TITLE LOANS and • INTEGRITY TEXAS FUNDING, * LP, • • Pl.aintiff!l' • vs. • HARRIS COTJNTX 1 TEKJI.S TMX FINANCE HOLDINGS, • Il<C.: '!'MX FIN.l\NCE, LLC; TMX FINANCE OF TEXAS, • INC, ; TITLEHAX OF TEXAS 1 • INC. ; FELIX Do LEON; and ISHH1'1EL HERNAliDEZ, • 152liD JUDICIAL DISTRICT

ORAL AND VIDEOTAPED DEPOSITION OF THOYJI.S S. KIRK JUNE S, 2014 ························································ ORAL AND VIDEOTAPED DEPOSITION OF THOMAS B. KIRK, p~oduced a~ a witness at the instance of the PLAINTIFFS, and duly ll'worn, wa~ taken in the above-styled and numbered eau::e on thm 5th of JUlre, 2014 from 9:10 a.m. to 12:29 p.m., Oefore MELISSA PARKHILL, CSR, in and for the State of Texas, reported by computor-assintod machine shorthand, at the law o£ficcs af Beck Redden, 515 Congrcs~ Avanua, Suite 1750, Austin, Travis County,

0874 P~ge 2 l Texn$, pursuant to the Texa~ Rule~ of Civil Procedure and tho provisions :tatad on the rocord or att~ehod hereto.

' ' • lO ll

0875 Pag111 3 1 APPEARANCES

3 FOR THE PLAINTIFFS: 4 Sarah F. Power~, Attorney at Luw -and.- 5 Ch:t:ist.ina Goebelsmann, J>.ttorncy at L<'lW W).RGO Ftu:NCII 6 1889 Cantury Park EaJ:t, suit111 1520 Los Angalen, California 90067 7 (305) 913-8587 spoworcGwargc£rcnch,com • cqocbel~munnGw3rgofrench.com

• FOR Tll.E DEFENDAN'l'S: Bryon Rie~, Esq.

12 (Not Pre~ont) -and- 13 Geoff Gannaway, £sq.

BECK REDDEN, LLP 1221 HcKinncy, Suito 4500 Houston, Texas 77030 15 (713) 951-6263 [email protected]~

18 ALSO PRESENT: 19 Jercr:~y Garrott, Videographcr Victoria Na~, Attorney at Law 20 (PriiiUIIInt Eloetronically)

0876 Paqo 110 l Q. Did ~he tell you what to do ~ith thi~

3 A. Yo:..

4 Q. What did Lucia tell you to do with this infoX'l!l3tion?

6 A. To mail the flye~c to the cuctomcrc.

' Q. And when you !lay, "mail t.he flyers," lfhioh fly~trs ara you referrinq to?

9 A, Tho ones we went over a few minutes aqo, the buyout flyers.

11 Q. So that would have been the flyers that appeared in Exhibit Number 4?

13 A. YeG.

14 Q. Did Lucia tell you why thecc cu~tomcrc should lS be sent those flyers that were identified in Exhibit 4?

15 A, We wanted to poscibly buyout their current loans.

Q. And After you received this list or similar lists from Lucia, would you, in fact, send those buyout flyers to the customarc that were listed on the list?

2l A. Ye:L 22 Q. llow ::w.ny times did Lucia provide you li~:~tn that looked like th~ list in Exhibit 5?

24 HR. GJ>.NN)I.WA:i: Obj act to f'orm.

25 A. Three or four times.

0877 1 Q, Wa~ that three or ~our times during your entire time in Au~:t:l.n 2?

3 A. Yc~.

Q. And how long ~ere each of those li~ts that you ' received from Lucia, to your recollection?

~pproximately 30 to 40 page~. ' A, 7 Q. Do you recall how many different customers names ~pp~ar~d on the li~t= that Lucia provided to you?

9 A. No. 10 Q. "To your rocollC!Ction, did those lists inclt~de information ro~arding the current lienholder that held a lien on tho vehicle owned by that cu~:tomcr?

13 A. Yes.

Did that include lienholder info~ation related " Q.

15 to a company called Integrity Tc~a$ Funding?

GA.~NAID\.Y: " 17 A.

MR. boliove no, Object to fo=.

Q, And so referring to Exhibit 5, could you please " sho~ us generally ~here you would locate the contact information for n custo~c~ using the cx~lo of the individual that appca~s in the top ono-thi~d of this doc~~nt unde~ the n~o Alexnnde~ ~Barra?

23 A. It qives tho nnmc :md the addrt~ss in tha vury top lines t.op two lineD.

25 Q. So whnt -- In ordo.t: t.o mail 11. flyer to, for

0878 Paqe 1 CAUSE NO. 2013-33584

WELLSHIRE FINANCIAL IN THE DISTRICT COURT SERVICES, LLC d/b/n LONESTAR TITLE LOANS ~nd • INTEGRITY TEXAS FUh~ING, • LP, Plaintiffs vs. 152ND JUDICIAL DISTRICT TMX FINANCE HOLDINGS, INC,; TMX FINANCE, ttC; • TMX: FU<ANCE OF TEXAS , INC. ; TIT~ OF TEXAS, • INC.; FELIX DELEON; and ISHM11EL J!Etui'ANDEZ, • • HARRIS COUNTY, TEXAS Defendants

ORAL AND VIDEOTAPED DEPOSITION OF MICHAEL RYAN JUNE 25. 2013

ORAL AND VIDEOTAPED DEPOSITION OF MICHAEL RYAN, p:odueod as a witness at tho instance o£ the PLAINTIFFS,

numbered cause on the 25th of JUNE, 2013, from 11:41 a.m. to 1:51 p.m., before MELISSA PARKHILL, CSR, in nnd for the State of Texas, reported by computer-assisted machine sho:thand, at the law offices of sutherland Asbill & Brennan, 600 Congress Avenue, Suite 2000, Austin, Trnvis County, Texa~,,pursuant to Texas Rules cf Civil Procedure

0879 Pnqc 2 and the p~oviaions stated on the ~ecord.

5 APPEARANCES

7 FOR TilE PLAIN'riFFS: B JeGsica c, Casey, Attorney at Luw WARGO FRENCH Peachtree Street, NE, 26th rloor ' Atlanta, Georqiu 30309 10 (404) 853-1500 jcusey~varqofrencb.ecm

13 FOR TilE DEFENDANTS, 'n:OC FillANCE OF TEXl\S and 'l'ITLE.MAX o£ TEXAS: Stephen T. LaBriola, Esq.

15 FELLOWS LABRIOLA S~ite 2300, South Tower 16 225 Peachtree Street, NE Atlanta, Georqia 30303 17 (404) 589-9200 alabriola~fellab.com -AND- Geoff Gannaway, EGq.

20 BECK REDDEN 1 LLP 1221 McKinney Street, Suite 4500 21 Houston, Texa~ 77010 (713) 951-6263 22 gqannawayGCeckredden.com

0880 1 APi>&ARANCES CONTINUED

3 FOR THE DEFEtiDANT, v.R. DELEON: • Chri$tin• A.

SMYSER KAPLAN ' B~an, Atto~oy ~t ~~ VESELKA, LLP 5 700 Loui~iann, suite 2300 Houston, Texas 77002 (713) 221-2345 ' cbry<Ul@skv. com a FOR. THE "OEF'EN'OJI.N'l', Mft. IIERNANDEZ: 10 Rooeo Rondon, Esq.

KALL MAINES LUNGRIN 1 P, C. ll Willi~s Towor, 64th Floor 2800 Post Oak Boulevard 12 Hou:;ton, Tcx-a:~: 77056 (713) 971-9000 lJ rrondonQhallmainoslugrin.com

FOR THE WITNESS: Edward J. Uennessy, Esq.

17 THE HENNESSY Ll\W FIR."!

2900 Wesl~yan, Suite SSO Houston, TQxas 77027 " (713) 224-5066 ejhQhgbatty.oom

]I.L$0 PP..ESENT:

0881 Page 45 l A. Not that I recall, no, 2 Q. Do you recall whether -- Strike that.

3 Tell me how the proce~s worked with requesting these searches from Lucia. Did other people, to your knowledge, go directly to her or did ~st of the requests filter through you to get this info~ticn?

7 A. I don't know the answer to that question. • Q. !tow many of the Austin -- Hell, how many atore:ll are there in Austin?

10 A. I believe there's 21 or 22 now. ll Q. O! the 21 or 22 stores in the Austin market, how ronny of them do you recall making roquosts for this information on their behalf?

14 A. Maybe ten. lS Q. And at one point in time you were in charge of half of the .Auctin mArket; i:s th11t right? l7 A. Uh-huh.

How many stores were in your district when you " Q.

were the north di#triet managor? " 20 A. Nine.

2l Q. Did all nine of tho~e stores rcquo~t

22 informAtion from DataTra~ through you?

23 A. None of the~ actually requested anything from me. 2S Q. Did you request info~ation from ontaTrax on

0882 behalf of all nine of tho~e storeG?

2 A. ~ raquo~tod information from Lucia.

3 Q. For all nine of those stores?

4 A. Not all of them, no. 5 Q. How many of tho~e nine store~?

6 A. Probably five.

7 Q. Why didn't you request info~tion on behalf of tha oth11r four stor~u;?

9 A. tic particul.ar rl!ason. don't know why. Some 10 were u~inq the -- the mailer$ to do their marketing, Some of them weren't using it. Some of them were getting their information directly from Lucia. Some of them were not.

14 Q. !low do you know that so:>:e of these Gtorcs wore getting information directly from Lucia?

16 A. Just by conversation.

17 Q. How many convar~ation~ do you think you had of that nllturc?

19 A. A couple.

20 Q. Do you recall what ~toreG were getting their infor=tion directly fro= Lucia?

22 A. Ju~t thQ ona~ that I n3mod. And then the only addition~! one~ would p~obably be Au:tin 12 and Au=tin 4.

24 I gave you th~co -- th~co ~to~oa 1 and the only othe~ two that were added on thnt li~t were Austin 2 nnd Austin 4.

0883 Pttqe 47 1 Q. Who ~as tho G.M. ~t Au~tin 12 at the time?

2 A. Jay Wilkerson [W~lkin:on).

Did Mr. Wilkar~on tell you that h2 was getting ' Q.

4 this information directly £rom Lucia?

5 A. No; no. I ~- I -- Thoso were the adaitional ~torus that r startect requestin9 information for.

Q. Oh, I'm sorry. ' Who was tho G.M, for Austin 4? ' Jose Jo.t"1%1ulo.. ' A.

10 Q. What stores d~ you believe were getting information dirRctly £rom Lucia?

12 A. Prob~ly Austin 20, 13 MR. HENNESSY: And understo.nd, don't be guos~~oing,

15 A.

MR. HENNESSY: If you know, answer. " I don't know; I don't know. " A.

MR. HENNESSY: If you don't answer -- don't know, don't guess.

20 A. :r don't know, 21 Q. Did anyone vvvr tell you that stores were getting their information directly from Lucia?

23 11.. No. 24 Q. Why do you think that this wa~ the c~~o?

25 A. Tho.t they ueren' t t<!llinq me?

0884 Page ~B l Q. No, Why 4o you think that sto~os were gatting

•. their information directly from Lucia?

Well, they were either qettinq --either getting i t from me ~~ the informAtion from me or from 5 Luci~ bocau~e everyone -- they all talked to Lucia.

6 Evo~one talked to Lucia. But don't know. To ba I honest with you, I do not know. • Q. Did you ever obtain tho~o customers lists from anyone, other than Lucia? lO • Not -- No .

11 Q. And you always picked these lists up at Lucia's 12 store?

13 A. (Node.)

14 Q. Did Lucia, to your knowledge, over -- Strike 15 that.

n •.

Did Lucia ever Nuh-uh . c-~il you any of these lists?

Did you ever e-mail any of thero lists to 19 anyone else?

20 A. Nuh-uh; no. 21 Q, And I apoloqi~o if you already answered this.

22 Did any of the stores in your di~t~ict ~ko a ~equo~t to

you •. fo~

Q. those No. custo~er li~ts?

As far as a formal request, no .

or an informal request?

0885 Paqo ~ CAUSE NO. 2013-33584

WELLSRIRE FINANCIAL IN THE DIS~RICT COURT SERVICES, LLC d/b/a LONESTAR TITLE LON-IS and • INTEGRITY TEXAS FUNDING, LP, Plaintiff.!l vs. 152ND JUDICIAL DISTRICT TMX FINANCE HOLDINGS 1 INC. ; 'l'MX FINANCE, LLC: TMX FINAUCE OF TEX1\S 1 INC. ; TITLEW\X OF TEXAS 1 INC. 1 FELl: X DELEON; and l:SitW\!:L HE!UIANDEZ, Defendant:: * ll.AAAIS COUNTY, TEXAS

ORAL AND VIDEOTAPED DEPOSITIOl~ OF PATRICK SUDDUTH JVUE 25, 2013

ORAL ~ VIDEOTAPED DEPOSITION OF PATRICK SODDUTH, produced ax a witnesx at the instance of the PLAINTIFFS,

numbured enu~o on the 25th of JUNE, 2013, from 2:38p.m. to 4:54 p.m., before 1-tt:Liss;,. PAR1\RILL 1 CSR 1 in and for the state of TcKas, reported by computor-asGiGtcd machine shorthand, nt tho law officeG of Sutherland Asbill ' Brennan, 600 Congress Avenue, Suite 2000, Auntin, Trnvis County, ToKaG, pursuant: to Texas Rules of Civil Procedure

0886 Paqc 2 l and tho provision~ ~tatcd on tho record.

' s APPEARI.llCES

7 FOR. THE PLAINTIFFS: 9 Jc~~io~ C. Ca$ey, Attorney at Law ~-lARGO FRENCH Peachtree Street, NE, 26th Floor ' Atlanta, Georgia 30309 lO (404) 853-1500 [email protected] ll l2 FOR TilE DEFENDANTS, 'l'MX FINANCE OF TEXAS ;'l.nd Tl:TLE~!AX of TEXAS: l4 Stephen T. LaBriola, Esq.

15 FELLOWS LABRIOLA Suite 2300, South To~er 16 225 Peuchtree street, NE Atlanta, Gaorqia 30303 l7 (404} 589-9200 [email protected] -AnD- " Geoff G~naway, Esq.

20 BECK REOPEN, LLP 1221 McKinney Street, Suite 4500 21 HOU$ton, Texau 77010 (713) 951-6263 22 [email protected]

0887 Page 3 1 A P P E A R A N c E S C 0 N T I N U E 0

3 FOR THE DEFeNDANT, HR. DELEON: 4 Chri~tinn A, Bryan, Attorney at Law SMYSER RAP~~ & VESELKA, LLP 5 700 Loui~iunn, Suite 2300 Houston, Texas 77002 6 (713) 221-2345 cbrynnQ ckv. com

Sl FOR THE DEFEND1\..'t'l', MR, HE!Uill.NPEZ: 10 Reece Rondon, E~q.

HALL loiAINES LUNGRIN, P.C.

11 Williams Tow~r, 64th Floor 2900 Post Oak Boulevard 12 HoUGton, Texa~ 77056 (713) 871-9000 13 [email protected] l4 FOR THE WITnESS: Richard D. Milvenan, E&q.

17 l~CGINNIS, LOCHRIDGE & X!LGORE:, L.L.P. Conqross Avenue, Suite 2100 Austin, Texas 79701 " (512) 45l5-6005 [email protected] " AI.SO PRESEliT: Cody Hall, Videoqraphcr

0888 Pa.ge 43 pu.-poses?

2 HR, HILVENAN: Objection, form.

' Q.

4 pu.-posc~ for which som~one can zccess the information in the D~taTrax database? • I'= not 100 percent sure what -- 7 MR. MILVENAN: Objection, form. a A. Lik~ I ~aid, I don't know a whole lot about the ~ progr~ or anything like that.

Q. That'~ fine.

A. Yeah.

Q. t~e're just hera to find out -- A. Yeilh.

Q. -- what you know tod~y.

A. Right.

Q. Did Mr. DeLeon ever tell you that he had to certify a purpose for accessing in!o~ation from DataT..:nx?

A. No. " 20 Q. Othc..: than Jim, did any of your superiors over

22 A. No. 23 Q. To your knowlcdqo, how =any of the TitleHax stores in your district received informntion that was obtained from DataTrax?

0889 1 A. 'I'hat ~oulel b~ ~- I don't know 100 percent £or GUro. I would say -- I know thoro wa~ probably a couple who I don't believe ovar 90t --who ever u~ad any of tho~o. If I were to quos~ honestly, i t would bo a little speculative, but I think IMybe six or seven pos:-.ibly.

' Q. oo you po~~onally know th~t ~nyona at tno~o

7 atorea waG -- h~d obtained this information from S O;~.ta'l'rax?

My understanding was that any of the ' A.

10 info~tion came from reports that Felix had pulled.

11 Q. You mentioned Austin 3 and Austin 13 were two store:!! --

" A. Riqht.

14 Q. -- that you personally Obtained information for. " What other stores in your district do you believe had info~tion that was obtained fro~ Data'l'rax?

19 HR. HILVENAN: Objection, foX'lll.

moan, the specific numbers? " A, ~ou sto~c

20 Q. Right.

21 A. I'll sa.y I'm fairl.y confidant that J\u:a:in 1.8 diQ not, And, you know, tho others I think i t would be an a~~umption if were to ~ay th~t all of the rest did.

24 Oh, I uould also ~cal pratty comfortable suyinq that Austin 15 probably never roooivod any,

0890 Tab U ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

2 REPORTER'S RECORD VOLUME 1 OF 1 VOLUMES 3 TRIAL COURT CAUSE NO. 2013-33584 WELLSHIRE FINANCIAL SERVICES, LLC d/b/a ) IN THE DISTRICT COURT LOANSTAR TITLE LOANS, d/b/a MONEYMAX TITLE ) ) LOANS, and d/b/a LOANMAX; MEADOWWOOD ) FINANCIAL SERVICES, LLC, d/b/a LOANSTAR ) LOANS, AND d/b/a MONEYMAX TITLE LOANS; and ) INTEGRITY TEXAS FUNDING, LP ) 8 ) vs. ) HARRIS COUNTY, TEXAS 9 ) TMX FINANCE HOLDINGS, INC.; TMX FINANCE, ) ) LLC; TMX FINANCE OF TEXAS, INC; ) and TITLEMAX OF TEXAS, INC. ) 152ND JUDICIAL DISTRICT 14 ORAL HEARING ON PARTIES' MOTIONS 17 On the 21ST day of November, 2014, the following proceedings came on to be held in the above-titled and numbered cause before the Honorable ROBERT K. SCHAFFER, Judge Presiding, held in Houston, Harris County, Texas.

21 Proceedings reported by computerized stenotype machine.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0891 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 .

1 AI?I?EARANCES MR. JOHN DANIEL JOHNSON SBOT NO. 24046165 SUTHERLAND ASBILL & BRENNAN, LLP 1001 Fannin Suite 3700 Houston, Texas 77002 Telephone: 713-470-6100 Fax: 713-654-1301 E-mail: [email protected] Counsel for PLAINTIFFS

10 MR. JOSEPH D. WARGO GA 738764 MS. ABIGAIL STECKER ROMERO CA 284534 WARGO FRENCH Peachtree Street NE 26th Floor Atlanta, Georgia 30309 Telephone: 404-853-1500 Fax: 404-853-1506 E-mail: [email protected] Counsel for PLAINTIFFS MS. CHRISTINA GOEBELSMANN SBOT NO. CA. 273379 WARGO FRENCH LLP 1888 Century Park F Suite 1520 Los Angeles, California 90067 Telephone: 310-853-6300 Fax: 310-853-6333 E-mail: [email protected]; [email protected] Counsel for PLAINTIFFS CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0892 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 A P P E A R A N C E S MR. GEOFF GANNAWAY SBOT NO. 24036617 BECK REDDEN 1221 McKinney Suite 4500 Houston, Texas 77010 Telephone: 713-951-6263 Fax: 713-951-3720 E-mail: [email protected] Counsel for DEFENDANTS MARY-OLGA LOVETT SBOT NO. 00789289 GREENBERG TRAURIG, LLP 1000 Louisiana Suite 1700 Houston, Texas '77002 Telephone: 713-374-3541 Fax: 713-754-7541 E-mail: [email protected] Counsel for DEFENDANTS CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0893 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 (Judge enters) 2 THE COURT: All right. Wellshire Fiance Services v. TMX Finance.

4 I was just going to say for the benefit of my court reporter I want the Plaintiffs to identify who's speaking first and then we will get to the Defendants.

7 Start with Mr. Johnson.

8 MR. JOHNSON: Daniel Johnson.

9 MS. GOEBELSMANN: Christina Goebelsmann on behalf of the Plaintiffs.

11 MS. ROMERO: Abigail Romero on behalf of Plaintiffs.

12 MR. WARGO: You Honor, Joe Wargo also appearing for the Plaintiff.

14 THE COURT: Say again?

15 MR. WARGO: Joe Wargo.

16 THE COURT: Mr. Gannaway, you start.

17 MR. GANNAWAY: Your Honor, Geoff Gannaway on behalf of the Defendants.

19 MS. LOVETT: Mary-Olga Lovett here for the Defendants along with Chris Johnson our Co-Counsel.

21 And I am to extend the apologies of my colleague Mr. Garcia who got dragged away with the Mayor but he does appear as well.

23 THE COURT: Oh, you just had to drop that.

24 MS. LOVETT: He told me to. I had a fiduciary duty to, your.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0894 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 THE COURT: Shameless, shameless promotion -- self-promotion -- 3 MS. LOVETT: From Mr. Garcia -- 4 THE COURT: -- from Mr. Garcia.

5 MS. LOVETT: Not from me, your Honor.

6 THE COURT: Okay. I understand.

7 All right. Ms. Lovett, you're new to this game, aren't you?

8 MS. LOVETT: I am, your Honor.

9 THE COURT: Okay. We have 11 filed Motions, correct?

10 MR. JOHNSON: I think that's right, your Honor.

11 THE COURT: Since these Motions have been filed have any been resolved by agreement?

13 MR. GANNAWAY: I don't think so. 14 MR. JOHNSON: Some issues in some of the Motions have been narrowed, but none of them have been resolved completely.

16 THE COURT: Okay. I have -- Defendant has filed Motions to Compel. The Plaintiff has filed a Motion to Compel -- two Motions to Compel.

19 Defendants have filed two Motions for Protection. The Defendants filed a Motion to Designate a Responsible Third Party.

21 The Plaintiffs have filed Letters Rogatory and Motions -- I guess Motions to Compel relating to that -- those Letters Rogatory.

23 MR. JOHNSON: Not necessarily. But I think except for that last part of the sentence, I think that's right. And I certainly would accept the Court's direction in however you might want to CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0895 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 proceed.

2 I might suggest of the 11, the three Motions for Letters Rogatory and then Defendants' Motion for Protection as to the DMV database really I think bundle into one issue or one argument.

5 And, so, I think if the Court will entertain those first, we might be able to dispose of four at one time.

7 MR. GANNAWAY: Actually I think, your Honor, some of the quickest matters that are raised in our Motion to Compel, which is a very straight-forward, quick matter and it, also, happens to be the first -- first of the Motions that was set for a hearing in front of your Honor.

12 MR. JOHNSON: We are looking to get more bang for the buck.

13 THE COURT: I'll tell you what we're going to do: 14 We're just going to go in order as it is in the Docket Sheet here and that way we can flip back and forth between parties.

16 First thing I have is a Motion to-- Defendants' Motion to Compel the Plaintiffs to Respond to Written Discovery.

18 MS. LOVETT: Correct, your Honor.

19 I believe the Court had ordered prior to my entree to the case -- and I don't want to retread old ground, but the Court had expressed concern about the full sameness of the damage model. And we obviously had sought Discovery on that issue. And the Court had ordered the Plaintiffs to disclose the mean by which the damage model would be calculated since it was represented I believe at the initial TRO that there would be -- that they knew they lost customers, there CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0896 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 were lost customers. Essentially what they have called a "per-customer calculation model" is what they gave us in response to your Order ..

4 THE COURT: Okay. Now, does this request that you're making morph into somehow the list that Judge People is preparing the Overlap List that Judge People is supposed to be preparing as the Master in Chancery?

8 MS. LOVETT: Your Honor, the Plaintiffs might contend that it does. We think it's a simpler issue. We know and I know from my review of the case and getting up to speed that your Honor has I think provided the parties with an opportunity to conduct Discovery over the last 17 months including with what would be assistance of the Special Master.

14 What we don't have is evidence thus far of even one customer lost which would be and which was represented to the Court at the TRO as the basis for the damage model.

17 So, what Plaintiffs are now calling a per-customer calculation model, according to their Order by your Honor, is Plaintiffs' lost profit damages will be based upon an analysis of the revenue that Plaintiff lost as a direct and proximate result of our conduct and the associated incremental costs -- I can go on. But the point of fact, your Honor, the list has yet to yield either the overlap fashion or its initial fashion one customer lost as a result of this alleged tortious conduct.

25 THE COURT: All right. But in this Motion -- unless I have CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0897 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 the wrong Motion to Compel, and I don't think I do -- you're asking for Plaintiffs' profit information, Plaintiffs' per-customer calculation, Plaintiffs' attorneys' fees evidence, contracts that have been breached and/or tortiously interfered with and a couple of other things that are more general than these more specific items.

6 MS. LOVETT: Understood, your Honor. All of which we would have been satisfied or at least we wouldn't feel the need to file this Motion to Compel had the Plaintiffs complied with the Court's Order to provide the basis for their damage calculation, which would necessarily include all of those elements.

11 THE COURT: Has a basis for your damage calculation been provided to the Defendant in general terms?

13 MR. JOHNSON: Your Honor, it was interesting that Ms. Lovett stopped reading where she did because we went on and had she continued to read our explanation indicated what we did is we broke down different parts indicating that it would be calculated from lost CSO fees, lost interest, lost loaner-related fees and charges, lost refinances and repeat customer business.

19 On the repeat customer business we previously produced information supporting our allegations about the number of times people refinanced.

22 So, the -- if your Honor recalls from the hearing that we had, it's the Overlap List that was very much the jumping-off point I will say and you will hear much about this I am sure as we go on. We are very frustrated because we still do not have that.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0898 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 THE COURT: Okay. But you have an initial Overlap List.

2 MR. JOHNSON: We do.

3 THE COURT: And have you conducted any Discovery to find one person that has not resigned or renewed their loan with your company 6 MR. JOHNSON: No. 7 THE COURT: because of our even marginally because of any agent of the Defendant?

9 MR. JOHNSON: Your Honor, I think the Overlap List -- the initial Overlap List revealed over 10,000 of those people.

11 THE COURT: No. The Overlap List reveals common customers, doesn't it?

13 MR. JOHNSON: That's right. And common customers where you can see on a date where the loan ended with us and then began with them. And, so -- 16 THE COURT: But don't you still have to show -- to prove to them that the loan that ended with you and began with them was somehow related to their actions?

19 MR. JOHNSON: There is no question but -- that when we come to trial in this case we're going to have to put on that evidence and they are entitled to ask for that evidence. But what I think we started with was Ms. Lovett is saying that the Court ordered us to provide a narrative of how we're going to calculate our fees. And what I've just read to you was a broken-down narrative of the pieces as to how we're going to come up with per-customer loss model.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0899 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 Now, I didn't read anything in their Motion that is to do -- if what she's describing, well, hey, we need evidence of causation, there is not a word in this Motion about causation. And that's just not before the Court.

5 What she -- the point that she started with was that your Honor ordered us to describe in narrative in general terms because we're waiting on the Overlap List give them the description of what our per-customer damage model would be and we told them.

9 We said it's going to comprise interest. It's going to comprise CSO fees. It's going to comprise refinance fees. We told them that. They didn't complain about that for -- I don't know -- two or three weeks. Maybe even longer. A month. And then, finally, we see it in the Motion. But there is nothing in that -- their Motion about the issue of causation. That's just not in there.

15 THE COURT: Okay. So, what specifically are you asking for that they have not produced as of yet?

17 MS. LOVETT: Your Honor, what I'm specifically asking for is evidence of one -- what -- I didn't stop reading to be disingenuous.

19 I stopped reading because of anything that they say there is irrelevant if we don't have a customer upon which to base these losses.

22 So, in other words, we have to get or mind around, as your Honor knows, what's out there in the universe of damages. How much is it going to be. We are entitled to know that. We're entitled to calculate.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0900 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 Thus far from the original list and now the Overlap List the Court has correctly stated we don't know one individual. So, we don't even know that there's something out there to whom all of these factors could be applied.

5 These are the factors. That's fine. That's like saying it is going to be X times Y, but we have to know that it's based on the loss of at least one customer. We don't have that.

8 MR. JOHNSON: I don't disagree with that. That's just not what they have asked for in their Motion. What they asked for in their Motion was I guess a further description -- 11 THE COURT: Okay.

12 MR. JOHNSON: -- of the components.

13 THE COURT: All right. When will this per-customer -- this evidence of a customer leaving one and going to another be available?

15 MR. JOHNSON: Well, your Honor, I think that the Court has ruled -- and obviously I don't want to jump ahead of the Motion for Continuance because that is part of this, but there is a date certain by which the Court has said, okay, Plaintiffs, you have to disclose your damage model.

20 THE COURT: Hold that thought just one second because I know where you're going.

22 Is it related to the Overlap List?

23 MR. JOHNSON: Yes.

24 THE COURT: So, your evidence of per-customer damages is related to the overlap List?

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0901 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 MR. JOHNSON: And expert work in relation to that, your Honor.

3 THE COURT: Okay. What else in this Motion besides the per-customer? You want profit information?

5 MS. LOVETT: We do, your Honor.

6 THE COURT: Okay. I don't -- I can't recall as I'm sitting here whether I ordered them to produce specific profit information as I have the Defendants.

9 MS. LOVETT: You did.

10 THE COURT: Have I?

11 MS. LOVETT: You did, your Honor.

12 THE COURT: Okay.

13 MS. LOVETT: Exhibit B to our Motion -- I am sorry. I'm skipping. I'm contemplating the two. I don't think you have ordered specific financial profit-and-loss information.

16 MR. GANNAWAY: Your Honor, if I may, may I approach?

17 THE COURT: Not sure. Go ahead, Mr. Gannaway~ 18 MR. GANNAWAY: I don't bite. I've got a summary I think of the issues that will -- 20 THE COURT: Well, I'm looking at your Motion. Isn't this contained in the Motion?

22 MR. GANNAWAY: This summarizes so that you can see all the RFP's that are at issue, your Honor. And if you turn here to the second page of what I've handed your Honor, these are all the Requests for Production that ·we are moving to compel in this Motion.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0902 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 The ones that are at issue relating to profits and losses and loan volume go from 4 through 11, your Honor. Those are the ones that are issue with respect to this.

4 Now, I need to point out, your Honor, in the landscape of this case, and as you know, my client has been ordered to produce a great many things. As you said -- as you said your strike zone is broad when we are talking about Discovery. This is right down the middle. They have a lost profits claim against the Defendants in this case. They're claiming lost profits.

10 They've got sworn affidavits in this case that they specifically saw lost volume in stores in Texas, and they have refused to give us their profits and losses and region where they claim to be affected.

14 Those are the same -- you have entered an Order about producing that kind of information. You ordered me to produce that kind of information because they had a discouragement theory.

17 THE COURT: Okay. You can hold that thought for just a second.

19 MR. JOHNSON: He is right in the sense that we have said before there has been a decline in revenue, and we have produced and I have Bates numbers where we have produced information like that that they have requested.

23 What they're asking for here -- and just going by the numbers here 1-A the profit-and-loss information -- and, your Honor, what they're asking for is monthly financial reports showing profit CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0903 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 and loss for the State of Texas in Dallas and Austin markets. Our whole point is, as I mentioned earlier, the jumping off point for this our lost profit is not going to be a general number. It's not going to be, hey, how did you do state wide.

5 It's going to be based upon, as your Honor indicated, this customer, this customer, this customer. And once we have that, candidly, our expert will be able to take that and will be able to provide all of that information for them.

9 The problem is when you ordered the supplementation of the Overlap List in July, now we're almost in December, and because of their foot dragging we don't have that information.

12 THE COURT: Okay. But you're going to produce information just like they're compelled to produce information to you. If you're going after their profits, you've got to show them you lost profits.

15 And I am going to go right down the middle on that. And you are going to provide profit-and-loss reports for your operations here in Texas that are consistent with showing in a general sense what you contend your profits -- your losses to be in profits.

19 We're not just going by customer, customer and that is going to be your evidence. You're going to have to provide them the same type of profit-and-loss information that you are demanding they provide to you.

23 MR. JOHNSON: Your Honor, our only point would be that's what we intend to do. We want to show that information, and we want to produce it. Otherwise, we're not going to be able to award us CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0904 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 damages. But what we want to do is provide information that is relevant that is based upon the the actual customers that we are going to be telling the jury were stolen.

4 THE COURT: We're going beyond that. Just like you're asking them to provide profit-and-loss statements for a specific time period for Texas and this region, you're going to have to avoid those same types of information -- that same type of information.

8 It's not fair for you to demand it of them and you not produce it yourself.

10 MR. JOHNSON: Your Honor, I would respectfully disagree with that only in the sense that this entire lawsuit we are here because of their conduct.

13 THE COURT: I understand that. Believe me I know that, Mr. Johnson.

15 MR. JOHNSON: Your Honor, and our lost profits claim based on the model we just read to you all of those components, the CSO fees, the refinancing, the interest rates, that's what our lost profits information is going to be. And that's information we do want to provide them. We just want to provide it once we get the Overlap List and we know who the customers are.

21 THE COURT: Item No. 1 on the Request for Production is Loan Contracts.

23 MR. JOHNSON: I think we are -- are we in -- is that 1-C?

24 No. I am sorry.

25 THE COURT: No. I'm looking at the cheat sheet Mr. Gannaway CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0905 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 handed me just a moment ago that cut through some -- did you provide them with a copy of that?

3 MR. JOHNSON: I got it now.

4 MR. GANNAWAY: I did, sir.

5 THE COURT: I'm on page 2.

6 MR. JOHNSON: The loan contracts I think this is an issue.

7 Candidly, when we got this, we were a little bit confused because we have provided them with the loan contracts at issue.

9 Now, if their request is -- and if their request is, look, if you're going to claim that we stole 20,000 customers, then you need to go to 20,000 files and pull up 20,0000 contracts and give them to them. That's not how we read the Request. But they do have the contracts and they've had them for some time.

14 MR. GANNAWAY: That is false, your Honor.

15 THE COURT: Now, wait. Now, Mr. Gannaway, when you say that, I'm going to look at you and say is Mr. Johnson lying to the Court.

18 MR. GANNAWAY: I think I need to clarify what Mr. Johnson said.

20 They gave me a few exemplar contracts. The kind of contracts that these people sign. I want the pen and ink that the people they are going to claim we interfered with and what they signed so that we can evaluate it.

24 They've got a tortious interference with contract claim.

25 And they're suggesting we can't see the actual contracts that are the CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0906 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 basis -- 2 THE COURT: Right. And I can't wait to see how you provide this information to them. Are you going to be -- because you have said at least on one occasion -- and I may be paraphrasing this incorrectly -- that you may not be able to identify each person whose contract was interfered with.

7 MR. JOHNSON: Your Honor, I will say this without revealing our work product or strategy in the case that we believe that our damage model may be presented to the jury in a way that complies with the evidence in a way that we don't have to show customer by customer causation. That's the point that we're making.

12 I will say this: 13 Mr. Gannaway -- and I think what he just said is confirming what we think is an absurdity at this point in the case is he literally and we will be guessing because what he wants us to do I assume is go through files of 15-, 20,000 people and pull up what is going to be the same accounts that he already has in his possession.

18 He's -- 19 THE COURT: I'm sure -- 20 MR. JOHNSON: already has those contracts.

21 THE COURT: No. No. Wait a minute -- 22 MR. JOHNSON: What he has is he's got the same contracts.

23 THE COURT: No. He's got the template for the contract, but he doesn't have the contract from Geoff Gannaway who you claim was interfered with. The rhetorical Geoff Gannaway, not really you.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0907 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 MR. GANNAWAY: Thank goodness.

2 THE COURT: Yeah. I just picked the name.

3 But if you're claiming that the contract that you have with Customer X you haven't produced that contract. You've produced the template for that transaction.

6 MR. JOHNSON: And the information that goes into it would be derived from the Overlap List. In other words, the form is going to have dates. It's going to have somebody's name on it. It's going to have the information from the loan. All of that information we are going to be able to derive once we get a finalized Overlap List.

11 And, your Honor, I am certainly not suggesting that once we get the Overlap List we identify, okay, here, now, we have our set of people for whom we're going to go to trial and present evidence on.

14 We may be able to scrape up these 10- to 15,000 contracts but at this point without the Overlap List there is no way we can do that.

17 MS. GOEBELSMANN: Additionally, your Honor, during our last hearing on October lOth it would be to produce loan contracts for all the loans at issue. And Mr. Gannaway represented that all that they were seeking were the narrative of those contracts, as we already provided the terms of those loans in response to prior Interrogatories based upon a prior Overlap List. And we are committed to otherwise aiming our response to that Interrogatory based upon our anticipated amended and correct Overlap List.

25 So, to the extent that they're seeking the terms of those CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0908 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 particular loans, they will be getting those. Now, whether those loan terms appear in individual blanks, that will be extremely difficult for our client to get together.

4 THE COURT: Okay. Mr. Gannaway, I know what you want. You want each contract of each customer that's been -- that they allege was interfered with.

7 MR. GANNAWAY: The first step to that they need to allege was interfered.

9 THE COURT: Right. And we can't do that -- we can't do that until the Overlap List is done.

11 MR. GANNAWAY: Your Honor, they have had a list of 8500 people on it for 11 months. And we don't have a lick of evidence that any one of those fits within the cause within the chain of causation that is required for them to make their case. Not one.

15 As Ms. Lovett pointed at the beginning, they have 8500 they've been living with for 11 months. Why don't we have a single contract signed by one of those people if they are going to claim that it fits their allegation model and it's going to result in them being awarded damages in this court?

20 MS. GOEBELSMANN: The Overlap List still needs to be amended -- 22 THE COURT: Wait a minute. You've had 8500 names. He's right there. You've had that Overlap List of -- the first Overlap List for almost a year now?

25 MS. GOEBELSMANN: But it's not reliable.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0909 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 THE COURT: Why not?

2 MR. JOHNSON: I don't think that -- 3 THE COURT: Why is it not reliable?

4 MR. JOHNSON: I don't think that we've had it -- 5 THE COURT: For whatever period of time you've had it, you've had it and you've had -- 7 MS. GOEBELSMANN: Right.

8 THE COURT: -- an Overlap List that contains 8500 names, correct?

10 MS. GOEBELSMANN: Correct. Except that it misses all the information that would have been -- that is supposed to have been provided by both of the parties for the years proceeding. So at this point -- 14 THE COURT: Like what information?

15 MS. GOEBELSMANN: The July 11 expanded Overlap List was supposed to include an entire year of information that had originally been missing. And that would include information as to who were customers of TitleMax and who were customers of LoanStar.

19 Once those -- when -- once those lists were produced, the Special Master was supposed to provide a new Overlap List. Without that additional information we don't know really whether the 8500 people are the correct 8500 or if it's even 8500. It may very well be double that now.

24 MR. WARGO: If I can be heard, your Honor? Joe Wargo.

25 We have a list that's incomplete as to the 8500, your Honor.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0910 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 Your Honor ordered that they provide information that goes back further.

3 One of the key issues here is who was whose customers. Who was whose customers first. Okay. When someone flips from one to the other or one to the other, that's evidence here as to whether their misconduct caused our damage.

7 We can't run anything with the 8500, your Honor. Because when we get that list that goes back even earlier, we're going to get new information potentially we expect that reason would tell us from earlier in time of where -- whether those customers were our customers first, their customers first.

12 It is an entire do over of the entire list. And they know that, your Honor. Maybe new counsel doesn't, respectfully. But they know that 8500 serves us no purpose because, if we give you a number today, it may be an entirely and will be for a certainty some of those people would have been other customers of other parties prior at least one of them. Maybe a certain percentage but we know for sure that that list will be faulty.

19 So, the 8500, your Honor, is of no value.

20 THE COURT: Okay. Ms. Lovett?

21 MS. LOVETT: Your Honor, new counsel does know one thing that Mr. Wargo-- whom I've just had that pleasure of meeting-- did stand up in front of Judge Bennett at the June 2013 TRO hearing and said this: 25 We have seen a lost customer base. We know we have lost CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0911 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 business.

2 That was the representation he made to the Court. He was able to make that recitation based on the fact supposedly that at least one customer was filched by misconduct. Our question is and it is the Court's question: 6 Why in the 8500 customers that they have whether they can at least make the allegation that there's been a jumping of ship that's attributable to this conduct?

9 THE COURT: Does the list of 8500 contain the identity of whether the customer was initially a LoanStar customer or a TitleMax customer?

12 MS. LOVETT: Your Honor, I think the answer to that would have to be were they anybody's customer. Who it is -- the list of 8500 is a snapshot in time that they based their TRO in good faith on. They had to have some basis from that list.

16 THE COURT: Okay. But that list is the identity of individuals who were customers of both the Plaintiffs and the Defendants.

19 MS. LOVETT: I understand, your Honor.

20 THE COURT: Does it show who they contracted with first?

21 MS. LOVETT: That is a -- go ahead.

22 THE COURT: If Bob Schaffer's name appeared on the Overlap List -- I'm not going to pick on you anymore.

24 If Bob Schaffer's name appears on the Overlap List, does it say: CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0912 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 Bob Schaffer contracted with LoanStar first or TitleMax first? ' 3 MR. JOHNSON: It does not, your Honor. And that is the entire reason -- 5 THE COURT: I got it, Mr. Johnson.

6 MR. JOHNSON: That's the reason why we had to expand.

7 THE COURT: That's why I'm asking this question. Identify whose customer they were first. It is hard to identify whether Bob Schaffer was filched -- I think you used that?

10 MS. LOVETT: That is mine, Judge.

11 THE COURT: That is your term.

12 Filched by one entity or the other. When will we know whose customer was first?

14 MR. GANNAWAY: Your Honor -- 15 MR. WARGO: When we have an Overlap List pursuant to the terms of your Honor's Order. And, remember, we tried to go as far back in time. Your Honor cut it off. And that is going to be a snapshot in time that -- 19 THE COURT: Okay. Mr. Wargo, hold on a minute. I don't mean to be disrespectful by interrupting because these guys here all know what interruptions do to the Court, but I'm going to short circuit this to a certain extent so that we are not here till 6:00 o'clock because you have probably have a plane to catch.

24 MR. WARGO: Yes, your Honor.

25 THE COURT: All right. So, we need a list which identifies CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0913 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 this information. We don't have that list now, do we?

2 MR. WARGO: No, your Honor.

3 MR. GANNAWAY: Your Honor, what we have list -- the list is not going forward in time. June 2013 -- 5 THE COURT: I know.

6 MR. GANNAWAY: -- we had a cut off before. It is still is.

7 So, they're going to know regardless of whether additional new loans end up on the new Overlap List, we know who's the last person in that time period to have a loan.

10 And under their theory, if the last person was a TitleMax loan, I guess that's what they're going to seek damages on. That is not going to change when they get a new list.

13 THE COURT: But that person whose last loan was TitleMax their first loan could have been TitleMax and their running a wild-goose chase after that person.

16 MR. GANNAWAY: Your Honor -- 17 THE COURT: So, my question is: 18 Is Judge Peoples preparing the Overlap List so that we know who the first lender was for that individual?

20 MR. GANNAWAY: The answer is "yes'' Judge Peoples has the information from the two parties at this point.

22 THE COURT: So, he's going to be preparing his Overlap List to identify Schaffer comma Robert first loan TitleMax, second loan LoanStar and so forth and so on?

25 MR. WARGO: Almost, your Honor. And that will be done by CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0914 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 the expert. But certainly data will be presented by the Special Master where then the expert can run that information.

3 THE COURT: Okay.

4 MR. WARGO: Yes, your Honor.

5 THE COURT: All right.

6 MR. GANNAWAY: Your Honor, they have taken the position in previous hearings before your Honor that even if a customer went back and forth if they ended up landing with TitleMax and they can prove all the other things they need to prove like this person was the subject of illegal search or even if months and months or even a year passes between the two loans, they're saying that's last touch.

12 TitleMax got a loan and they did those things, it is in our damages model. If they are going to stipulate here that if TitleMax had a loan before their loan that they are not going to include that in their damages model, maybe what they're suggesting is right. But I have a feeling they will not stipulate to that.

17 They would still include that customer in their damages model. And they should let us know that that information as part of their calculation and they should certainly let us see the contracts that they are going to allege fall into that category.

21 MR. JOHNSON: If I can clarify that a little bit? I think there may be some confusion.

23 What we said in the past is your Honor was asking some questions at the previous hearing about, well, aren't you just looking for loans that ends here and start here. And we said "yes" CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0915 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 we're looking for those. But just because a loan ended here with us and then started with them six months later, that doesn't mean it couldn't have been the result of an illegal search.

4 So, that may very well be within our damage model. But that doesn't change the fact that the Court made which is that we do not have that list to show within the time we have from where the loan starts.

8 THE COURT: I think they have know where the loan started.

9 Where the loan ends where the loan -- see, y'all have got me where I can't even talk.

11 Where the loan ends doesn't matter if we don't know where it started. And we have to know where it started and it ends. Needs to have started with LoanStar, correct.

14 MS. GOEBELSMANN: Yes.

15 THE COURT: You agree? I'm looking to LoanStar to tell me ''yay'' or ''nay.''

17 MR. JOHNSON: I believe that is correct.

18 MR. WARGO: Yes, your Honor.

19 THE COURT: Okay. Okay.

20 MS. LOVETT: Judge, just to clarify so that -- as we stand here today, your Honor, then the position is that all of a sudden now it is impossible to determine whether or not there has been a customer lost because we don't know the result of the Overlap List.

24 THE COURT: I think that's exactly what we are hearing.

25 MS. LOVETT: So as of today's date, there is no evidence in CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0916 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 the record that there has been a customer taken.

2 MR. WARGO: That is incorrect, your Honor. If I may? We are talking about our damages model and what we're going to present as damages.

5 That's an entirely different matter as to whether there's already been deposition testimony where people have raised their right hand and said: 8 I used to work at TitleMax. And those people came in with my buy-out sheets that I got using PublicData.com and they came in and I flipped them from LoanStar to TitleMax.

11 That evidence is in the record.

12 THE COURT: But the evidence of who they flipped -- 13 MR. WARGO: Their names is not known.

14 THE COURT: No. No. Wait a minute, Mr. Wargo.

15 MR. WARGO: I apologize.

16 THE COURT: You want a clean record?

17 MR. WARGO: Yes, your Honor.

18 THE COURT: Okay.

19 The evidence of who was flipped from LoanStar to TitleMax is not in this record. The evidence is that someone has testified that that I got the information and I flipped them from LoanStar to TitleMax.

23 MR. WARGO: Numerous people have testified to that. Yes, your Honor. And that they did not keep the names of those people.

25 That is correct.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0917 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 THE COURT: I can't wait to see how it's presented at trial.

2 MR. GANNAWAY: Your Honor, there is another thing that Mr. Johnson said but I want to make sure -- 4 MR. JOHNSON: Okay.

5 MR. GANNAWAY: they are taking-- they're not going to take the position at trial that, if a loan originated with TitleMax and then later on went through LoanStar then TitleMax again, they are not going to take the position they can recover damages if it originated with TitleMax?

10 I think that's what I heard him say, but I want to clarify because that's a matter for how Discovery proceeds.

12 THE COURT: I think I heard them say something akin to that.

13 MR. WARGO: We have to show your Honor that their misconduct caused us damage. We agree to that.

15 THE COURT: What if it's a TitleMax customer that went to LoanStar and then subsequently went back to TitleMax?

17 MR. WARGO: Based on the misconduct? We would have to prove it.

19 THE COURT: How are you going to prove it?

20 MR. WARGO: Your Honor, we would have to prove that.

21 THE COURT: Okay. Okay.

22 MS. LOVETT: Your Honor -- 23 THE COURT: Can I tell you something?

24 MR. GANNAWAY: Yes, your Honor.

25 THE COURT: When we get to trial, you're going to have to CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0918 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 prove that.

2 MR. WARGO: Yes, your Honor.

3 THE COURT: I mean, you're going to have to prove that customer -- 5 MR. WARGO: Yes, your Honor.

6 THE COURT: -- was highjacked in some scenario.

7 MR. WARGO: Yes, your Honor. We understand that. We are on the same page.

9 THE COURT: Okay.

10 MS. LOVETT: Your Honor, if I might because the concern arrises now in the context of this Discovery. And I am making a supposition having heard what Mr. Johnson said, which is how we would present.

14 We know that Rule 1006 references voluminous summary, that experts can do those. However, we also know that we are entitled to every single document that under pen that summary and that includes proof that each of these individuals was at LoanStar at one point and then at TitleMax.

19 So, we would not yield on an objection at the time of trial but here is our 1006 Summary and you're just going to have to take our word for it.

22 THE COURT: I don't disagree with you completely.

23 MR. JOHNSON: Well, that may be the case but I will say that in terms of taking evidence, okay, from the Overlap List that is not a Rule -- that's not what we are talking about a summary that we CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0919 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 prepared.

2 We've asked for a Special Master to take evidence that you don't want to give us and to take evidence that we don't want to give you and to put it in a form where we think it will be admissible in trial.

6 MR. GANNAWAY: Your Honor -- 7 MR. JOHNSON: But I will say that's beyond the scope. Now, if you want to give us your Customer List, then we will be glad to compare them ourselves and then we won't have all that underlying stuff.

11 But the whole point of having the Special Master was to avoid having to exchange each other's Customer Lists and then come up with an Overlap List that would be admissible.

14 MS. LOVETT: Your Honor, I won't point at counsel if he won't point at me nor will I call him "hey.'' I will call him "Mr. Johnson."

17 But my simple point is this and what your Honor's question cut to it: 19 How are you going to present this as evidence?

20 The only way to present this type of evidence of which I am aware of after 20 years, which I know isn't much, I know your Honor is Federal -- is Texas Rule of Evidence 1006, that is the summary of voluminous documents.

24 THE COURT: Okay. Okay.

25 MS. LOVETT: That's where I am with that.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0920 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 THE COURT: Okay. I got it, and that's not really related to what we're doing here today. That's a future thing and I appreciate what you're looking for and I can tell you I generally agree with what you're saying and I look -- wait with baited breath on how the Plaintiffs are going to present their evidence.

6 And, so, we're going to move on. The next item is attorneys' fee evidence.

8 MR. JOHNSON: I think this one should be resolved. We have amended our Discovery Responses in writing to state that we would produce the attorneys' fees invoices now.

11 We have made the same request of them. They have not produced theirs. As the Court is aware, that requires a lot of redaction. And, so, I think that if we work with them and just come up with a mutual time that both parties can exchange redacted documents, we can do that.

16 THE COURT: Now, the attorneys' fee information is always interesting when we approach it at trial because then inevitably one party or the other seeking fees neglects to bring themselves up to date.

20 Can we reach some kind of an agreement on the production of attorneys' fee information and the timing of it?

22 MS. LOVETT: Yes, your Honor.

23 THE COURT: So that we don't have to keep asking this question.

25 MR. JOHNSON: I think so. CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0921 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 THE COURT: Both sides are compelled to provide attorneys' fee information, correct?

3 MS. LOVETT: Yes, your Honor.

4 MR. GANNAWAY: We agree to it, your Honor.

5 THE COURT: So, let's do this: 6 How many different times do y'all want the attorneys' fee evidence produced?

8 MR. GANNAWAY: I think we should start out produce what the parties have incurred to date. And then we can agree to a time reasonably to update again, of course, at trial.

11 THE COURT: At trial. Okay. You agree to that?

12 MR. JOHNSON: That is fine with us.

13 THE COURT: Okay. So, we are going to produce attorneys' fee documentation as of today. And then we're going to produce attorneys' fee information as of the date of mediation.

16 Go ahead.

17 MR. JOHNSON: Yes, sir.

18 THE COURT: I mean, are you in agreement with that?

19 MR. JOHNSON: I was just going to clarify all the invoices issued through the end of October 31st, which would be to date I think.

22 THE COURT: That's fine. This time frame -- 23 MR. JOHNSON: Got you.

24 THE COURT: -- is what we're talking about here. Can you produce it to October 31st? I doubt seriously if either one of CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0922 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 Defense counsel are going to make an issue out of that.

2 MR. JOHNSON: Understood.

3 THE COURT: The date of mediation. Is that reasonable for the next time?

5 MR. GANNAWAY: That's fair.

6 MS. LOVETT: That would be good, your Honor.

7 THE COURT: Then mediation is probably going to be fairly close to the trial setting. Within 90 days of the trial setting.

9 MS. LOVETT: Yes, sir. It must be completed by February 18th I believe.

11 THE COURT: Well, today but we have a Motion for Continuance on the floor as well.

13 MS. LOVETT: Understood, your Honor.

14 THE COURT: Have y'all talked to Dave Matthiesen.

15 MR. GANNAWAY: No, your Honor.

16 MR. JOHNSON: I don't think we have spoken with him about that yet, your Honor.

18 MR. GANNAWAY: We had produced some alternatives. The Plaintiffs weren't agreeable. So -- 20 MR. JOHNSON: I think we are fine with Matthiesen.

21 THE COURT: You don't want Dave Matthiesen?

22 MR. GANNAWAY: Dave Matthiesen, your Honor, is a very good mediator. We had proposed after conferring with our client.

24 THE COURT: Okay. Unless there is an agreement, we are going to stay with Mr. Matthiesen.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0923 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 MS. LOVETT: We will find somebody, your Honor.

2 THE COURT: You want to weigh in on something?

3 MR. WARGO: No, your Honor. I just thought everybody was standing, so I might as well.

5 MR. GANNAWAY: Your Honor -- 6 THE COURT: Hold on a second. Let's finish this attorneys' fees thing.

8 So, October 31st -- up to October 31st or today, whichever you chose. Date of mediation is the next one and then the trial.

10 MS. LOVETT: Yes, sir.

11 THE COURT: Is that enough?

12 MS. LOVETT: I would suggest produce a week prior to trial and then maintain through trial.

14 THE COURT: And then whatever happens for that week on is presented at trial.

16 MS. LOVETT: Yes.

17 THE COURT: And we know it will be substantial i f we go to trial.

19 MS. LOVETT: Yes, sir.

20 THE COURT: Okay. So, now, mediation seven days before trial and then trial.

22 MS. LOVETT: Yes, sir.

23 THE COURT: Okay. Whoever is preparing the Order I hope you got it right.

25 Why don't you prepare the Order, Mr. Gannaway.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0924 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 MR. GANNAWAY: Got it, your Honor.

2 THE COURT: Okay. Contracts at Issue really goes to the Overlap List. And, so, we're going to hold off on compelling unless -- well, no, you've got the 5 MR. GANNAWAY: Exemplars.

6 THE COURT: exemplars. So, you know what the contract looks like? You're just waiting for the individuals?

8 MR. GANNAWAY: There is different kinds of contract but I don't know which one. Just so I understand your Honor, once they do have the Overlap List and then they will eventually have to provide the pen-and-ink contracts; is that your ruling?

12 THE COURT: We're going to face that issue once they produce the pen -- once they produce the Overlap List.

14 And, by the way, is Judge Peoples still speaking to me?

15 MR. GANNAWAY: Honestly, he doesn't bear the brunt of the work. The technical advisor he has hired.

17 THE COURT: Okay. Because when I see him at the Judicial Conference I may not go up to him.

19 MS. LOVETT: It's coming up, Judge.

20 THE COURT: Once the Overlap List is prepared and the damage model is prepared from that Overlap List, then we're going to talk about production of specific contracts.

23 I think until that -- until we get to that point, I don't think it's fruitful to discuss production of specific contracts.

25 MR. GANNAWAY: Your Honor, returning to last point just to CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0925 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 make sure I got your ruling because there has been disputes after your hearing before: 3 Their objections to our Requests 4, 6, 7, 8, 9, 11 relating to contracts are all overruled?

5 MR. JOHNSON: What were those, again?

6 THE COURT: 4, 6, 7 and 8?

7 MR. GANNAWAY: 8, 9 and 11, your Honor.

8 THE COURT: Okay. The rest of that page?

9 MR. GANNAWAY: Yes.

10 MR. JOHNSON: Your Honor, we'd likewise would like that to wait until such time we are able to provide our damages model so that you can make the determination if we cannot agree with Mr. Gannaway as to relevancy of that.

14 MR. GANNAWAY: Your Honor, that's completely unacceptable.

15 This needs to be provided to our expert witness as well.

16 THE COURT: Hold on. Hold on. Let me read this specifically.

18 Are these six Requests similar to the Requests for the same information that the Plaintiffs sent to the Defendants?

20 MR. GANNAWAY: They are nearly identical to what you have compelled us to produce. That's why I limited them to the Dallas and Austin markets because that's what you ordered us to do.

23 So, I essentially mirror imaged your Request on that is what at issue here.

25 THE COURT: Mr. Wargo?

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0926 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 MR. WARGO: Thank you, your Honor.

2 And our point is similar to what you were picking up on the last Order as far as waiting right now based on, as Mr. Johnson said, work product, which we're not in position to reveal right now.

5 That information is irrelevant to our damages claim. And merely because it may be relevant to what we're seeking from them, doesn't make it relevant to what we're seeking as damages from this case.

9 So, we asked your Honor that their dilato~y conduct in not providing information to the Special Master so that we have an accurate Overlap List, which has prevented us from providing our damage model to them which right now I represent to you will not be based in any way on that information, we ask that that not be produced.

15 THE COURT: But isn't this information not only reasonably calculated to lead to the discovery of admissible evidence but it's relevant information. And I don't know what's on it, but if it shows that your profits and losses in Texas for September 11th through June 13th went up every month, isn't that evidence that you haven't been harmed?

21 MR. WARGO: No, it's not, your Honor.

22 THE COURT: Okay. Why?

23 MR. WARGO: Why that's the case is our case is not based on how well we did in Texas. Our case is based on their theft of our customers.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0927 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 THE COURT: Okay. I appreciate that, but I'm going to order you to produce this information and I overrule your objections to Requests 4, 6, 7, 8, 9 and 11.

4 I am going to play this down the middle, and they're going to get the same type of information from LoanStar and your other -- there are two or three other companies involved, right, besides just LoanStar? We're speaking LoanStar parenthetically?

8 MR. WARGO: Understood, your Honor.

9 THE COURT: Okay. And then the last two are 17 and 18?

10 MR. GANNAWAY: Yes, your Honor.

11 THE COURT: Documents containing notations -- 12 MR. GANNAWAY: And I can -- 13 THE COURT: communications or trafficking of alleged buy outs of Plaintiffs' loans by Defendants.

15 MR. GANNAWAY: And this Request sprung from deposition of two of Plaintiffs' employees. And I asked them is there a way in your computer system that you keep track of when there has been a buy out of a TitleMax loan by LoanStar by other -- of TitleMax -- or the reverse -- when either of the parties buy out each other's loans.

20 Two of those employees testified, yes, I notate that frequently -- usually and put it in the notes field in our computer system.

23 What I'm asking for here, your Honor, is that they provide notations that suggest there has been a buy out one way or the other because that is stuff that is on the Overlap List. It shows CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0928 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 evidence of whether, in fact, there was a buy out going one way or the other, which goes directly to the damages.

3 THE COURT: What specifically are you asking for? The actual notes, or that someone noted that a LoanStar loan was bought out by TitleMax or a TitleMax loan was bought out by LoanStar?

6 MR. GANNAWAY: Whatever notation they have, your Honor. And in whatever form they have it in. In its native format is what we would like to see.

9 MR. JOHNSON: Your Honor, I think key phrase as reflected on the Overlap List and that's the point here is that the Overlap List is going to have this information on it.

12 What he's asking us to do I presume is for the -- and keep in mind, your Honor, on the first Overlap List there was 8500 identifiable people that were on both. But if you just take ours and you take theirs, we're talking about on the first one, tens of thousands of names.

17 Presumably what Mr. Gannaway is asking is that we go through tens of thousands of files and look for some notation about a buy out even though this case isn't about us buying out their loans and there has been no evidence of any wrong doing on our part.

21 The case is about their buying out our loans. And we think that that is overly burdensome. We think it's harassing. There's no reason for the because that same information is going to be on the Overlap List once it's completed.

25 And I will say as to the testimony -- I think the testimony CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0929 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 has indicated that's not a usual practice. That while those people did it some, that they're not aware of that being a usual practice in our company.

4 THE COURT: Can you note on the Overlap List the identity of -- no. Let me restate that.

6 Who were the people that testified to that?

7 MR. GANNAWAY: Alex Steven Haegen and Nancy Lopez.

8 THE COURT: Can you note on the Overlap Lists where these two individuals participated in a transaction and then go look at those transactions to determine whether either one of them made a note on that particular file?

12 MR. JOHNSON: I don't believe, your Honor, that there is a way to identify the person who was responsible for the transaction.

14 I think the Overlap List will reveal the store, will reveal a lot of information. And I think that candidly will reveal when there is a buy out because we have end dates and new dates for loans.

17 But what he's asking us to do in a case where really the complaint is -- there is no counter-claim. The complaint is they're buying out our loans based on their wrongful, illegal conduct. And what he wants us from us, hey, we want you to go through tens of thousands of files and look to see whether y'all bought out a loan from us and we just don't think that gets us anywhere in this case.

23 MR. WARGO: And, your Honor, if I can -- 24 THE COURT: Hold on just a second, Mr. Wargo.

25 You're asking them to produce documents that your employees CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0930 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 made notes on?

2 MR. GANNAWAY: That their employees made notes on. That they had made -- and it is not documents. It's in their electronic files they have a database that I assume can be run very quickly. If there is a reference to "TMX" or "TitleMax," both their employees said they would put in a notation.

7 And why it is relevant, your Honor, you don't assume that -- you should not assume that every loan on the Overlap List was a buy out. And sometimes there are -- there is a long time span between them.

11 In some issues it might be a close time span but it might still not be a buy out. That person might have found funds from whatever source, paid off their LoanStar loan and a few weeks later decides they have a wild hair and go to TitleMax and get a loan from them.

16 That's not a buy out. That's finishing one loan and starting another. And the Overlap List doesn't tell us that. And we know now that they've got relevant information that shows whether there were buy outs going both ways. Under any view of the evidence, that's going to be relevant, your Honor. And they haven't submitted an affidavit to you saying that's tough to run that search in the data. It's relevant and it's not overly burdensome.

23 THE COURT: Okay. Before I make a ruling one way or another, you need to give me an idea of what it would take and what the extent to which that would be a burden on LoanStar to look into CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0931 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 these files and find out if notations were made about buy outs, who bought out who.

3 I'm going before I make a ruling on this, I want to know what the burden is.

5 MR. JOHNSON: Understood, your Honor. We will submit an affidavit to that effect.

7 THE COURT: Okay.

8 MR. GANNAWAY: Your Honor, I think that there's only a couple of issues left with respect to this Motion.

10 One is they have a boilerplate objection to trade secret. I think in their Response said they're really not withholding anything based on that. But I want to make clear that they need to amend their Responses to say that. If they're going to say that, they will withhold trade secrets or produce pursuant to our Protective Order, that's fine. But I need to know they're not withholding anything by the substance of that.

17 MR. JOHNSON: We will amend our Responses to make clear we are not withholding anything on the basis of trade secret, Judge.

19 THE COURT: Thank you.

20 MR. GANNAWAY: The last issue has to do with language of the Order. And as your Honor knows, we went back and forth many times regarding the last Order that your Honor issued. And I'd asked you to reconsider it and your Honor let it stand.

24 Some of the items in there we're asking for reciprocal treatment, which you had ordered us to provide and to do. And the CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0932 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 limitations you placed on it we would like the same Order to that.

2 THE COURT: I haven't a clue what you're talking about.

3 MR. GANNAWAY: And I'm going to be specific, your Honor.

4 One is you told us not just to produce profit-and-loss information but to produce revenue -- certain revenue and expense information.

6 We'd just ask that they do the same thing so that we can analyze the profit-and-loss numbers.

8 The other is that you said if we didn't produce information pursuant to the Requests for profit-and-loss information, that we could not use it at trial to impeach their expert. And I would like -- your Honor, honestly I think that's an inappropriate ruling.

12 But if it is going to stand, then it needs to go both ways. And if they don't produce 14 THE COURT: What is inappropriate about it?

15 MR. GANNAWAY: Because it wasn't relief they sought in the Motion that was before your Honor when your Honor ruled.

17 THE COURT: But that is almost reciting what the Rule says that if evidence is requested and not produced, it doesn't come in at trial. And that's the whole intent of my ruling.

20 I am frustrated with having evidence come up at trial that was not produced in Discovery. And, now, I have to conduct an independent review of whether or not one party or the other is going to be prejudiced by that.

24 MR. GANNAWAY: I'm not here to challenge your ruling that you made already, your Honor.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0933 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 THE COURT: Well, except that you said that you didn't think it was appropriate.

3 MR. GANNAWAY: I apologize.

4 THE COURT: Mr. Gannaway, that tells me that you think the Court has made of some kind of error in its ruling.

6 MR. GANNAWAY: Your Honor, I apologize for suggesting that.

7 My point, now, is, given that position of your Honor, I would like reciprocal treatment.

9 MR. JOHNSON: Well, that wasn't in that Motion that they filed.

11 THE COURT: It is not in your Motion. But I will make it really, really clear that: 13 If Discovery is requested and not produced in this case -- because of the volume of information that we're talking about, if it's requested and it's not produced, it's not coming in at trial.

16 This Court is not going to conduct a review to determine whether it's prejudicial or not. If you ask for it and you don't produce it, it's not coming into trial.

19 Okay. So I'm sure if we have to trial this case, one of you are going to remind me of this and you probably won't have to. It's very frustrating. You know, I speak at seminars about what to do the last 60 days out before trial and one of them is to clean up your Discovery to make sure that everything is produced so that we don't have those issues.

25 I don't think I have to put this in any Order we have CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0934 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 relating to what we're doing today. I just wanted everyone to understand, if the other side doesn't have it, it's not coming in.

3 Okay. Can we move on to the next Motion?

4 MR. GANNAWAY: Yes, your Honor. That is all.

5 THE COURT: The next thing I have is a Motion for Protective Order regarding the Apex Deposition of Tracy Young 7 MR. GANNAWAY: Yes, your Honor.

8 THE COURT: -- who I understand is the CEO of TMX Finance.

9 MS. LOVETT: Your Honor, the LLC which is the parent -- 10 THE COURT: Parent.

11 MS. LOVETT: -- entity that owns the holding company. That owns the affiliates.

13 THE COURT: Okay. What specific evidence do you believe that Tracy Young has that's relevant to this lawsuit and cannot be obtained from other -- some other resources?

16 MS. LOVETT: That is a question for them, your Honor.

17 THE COURT: You're right. Thank you very much.

18 MR. WARGO: I like the question, but she didn't have an answer for that.

20 MS. LOVETT: I do.

21 THE COURT: Can I tell you something?

22 She has an answer for you.

23 MR. WARGO: Well, your Honor, we may disagree because the starting point here when you're talking about Apex Doctrine is whether it applies. And that's what we filed in our Response, your CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0935 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 Honor.

2 Mr. Gannaway has represented to this Court that the LLC -- and that is TMX Finance, LLC -- has one employee. And that is -- your Honor remembers this.

5 THE COURT: I've read all these Motions.

6 MR. WARGO: Okay. So, your Honor, from our point of view and I think the law is crystal on this -- there is no Apex Doctrine.

8 He is the guy and their Defendant in this case.

9 Your Honor has already ordered that his documents be produced. That his Email be reviewed. We're going to explore this when we get further in Discovery, but everything that came out of that Production was privileged. We will explore that in Discovery.

13 That's their current position.

14 But, your Honor, for the same reason that you ordered that his Emails are relevant based on Mr. Gannaway's representation that Tracy Young-- forget about him being a CEO. Okay, he is. He's also the CEO of the Texas entities at issue. He is.

18 Your Honor, he's the only guy. He's the only employee. So, .we are entitled respectfully, your Honor, to take evidence from the single employee of a Defendant in this case.

21 That's our-- that's why the whole Apex Doctrine, your Honor, doesn't even apply. It's a nonstarter.

23 THE COURT: Okay. Well, let's say for the sake of discussion that it does apply.

25 MR. WARGO: Okay. Your Honor, what we have here is -- and we CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0936 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 put this in our paper. Going back to December 6th, 2012 we have alleged from their General Counsel TMX Finance, LLC, saying as follows -- and this is in the record: 4 First TMX denies the allegations in your letter.

5 This is a letter from our general counsel to TMX Finance saying we've heard that you guys are doing some illegal stuff in Texas -- your Honor, that is the basis of this lawsuit -- and we would like you to stop.

9 And they wrote back through their Deputy General Counsel: 10 TMX denies the allegations in your letter. Specifically TMX employees are neither monitoring Select Texas stores, marketing parking lots for the purpose of obtaining license plate numbers from Select customers nor are they obtaining names and contact numbers of Select customers through improper searching of lien information in Texas state maintained motor vehicle records.

16 Now, your Honor, we know, though, that is just false. And that was from their Deputy General Counsel of TMX Financial.

18 They further state: 19 Second, TMX does not consider the above allegations to be a proper business purpose and has reminded all Texas managers of its position of its of this practice.

22 The only person who could have done that, your Honor, is Mr. Young. Tracy Young. He was the only employee of TMX Finance.

24 May I -- 25 THE COURT: Who was that letter from?

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0937 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 MR. WARGO: This is from Vin Thomas, their Deputy General Counsel dated December 6, 2012.

3 THE COURT: Deputy General Counsel of what?

4 MR. WARGO: The rate clause -- there's reference at the bottom. Their rate clause in their letter with their letterhead says: 7 Cease and desist letter dated November 15th, 2012 from Select Management Resources, LLC -- that's us, your Honor -- to TMX Finance, LLC. Parens, quote, TMX, close quote, close parens. They are responding on behalf of TMX Finance. Tracy Young. He's the only employee there.

12 And this representation -- the only one who could have authorized this individual -- this attorney to the make this representation is Tracy Young.

15 This representation, your Honor, purports to make a representation about what's happening in Texas concerning the facts and circumstances of this very litigation.

18 THE COURT: Why does it have to be ordered by Tracy Young?

19 MR. WARGO: He's the only guy. He's the only employee.

20 This is of record. There's no dispute here. He's the only employee.

21 He's the only manager, and he's the only member of the LLC.

22 THE COURT: Okay. Ms. Lovett?

23 MS. LOVETT: Thank you, your Honor.

24 First of all, what counsel says is "Re: The cease and desist letter" that they directed to -- they chose Texas TMX Finance, CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0938 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 LLC, this says "TitleMax'' on the letterhead ahd it's signed by -- if Mr. Thomas is the Deputy General Counsel and Mr. Young is the only guy, then obviously we're talking about a different entity if he is the only employee.

5 But here is the question that your Honor asked me and I will answer: 7 They've done nothing.

8 Your Honor had a hearing on October lOth where the parties I think quite vehemently debated the issue on what would be the proper topic for a corporate representative deposition. I know your Honor recalls that. Chapter and verse, your Honor.

12 THE COURT: And this record is going to look quite interesting, I know.

14 MS. LOVETT: Your Honor, we've seen more interesting.

15 But at that hearing, which is on October lOth, the parties were arguing and the Court found that the proper categories because there was not an agreement over those categories for what -- and I am calling it a 30(b(6) witness, a corporate representative witness under Texas Law.

20 Those categories were determined. The depo was set for November 13th, and we've got a ball game. Somebody is going to testify on all of those issues, which this Court ordered were proper.

23 Then something very interesting happens: 24 On October 23rd the Corporate Rep Notice is pulled. They say we don't have new information to depose a corporate CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0939 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 representative. The next day they notice Mr. Young because apparently they have enough information to depose him.

3 Now, that, your Honor, smacks harassment because Mr. Young is Apex. He is the crystal definition of an Apex. The reason he is the only employee of that one entity is because it sits atop all the other entities.

7 He is -- as you just heard -- the CEO of the Texas entity, which makes him an Apex Deponent. They have to carry the burden.

9 What have they done? That cancelled the deposition that we came in here and wasted your Honor's time with apparently and fought over and the next day they turn around and noticed him.

12 As they have told you, the only Emails produced that were relevant every single person who's testified has said I've never talked to this person about that. I've never talked to Mr. Young.

15 Not unusual because he's the CEO. But when his own Emails were produced and we provided a Privilege Log. That Privilege log contains only privileged communications.

18 I won't go into the details of those, your Honor, but simply put the representation was that there is nothing that he knows that is relevant. Your Honor had a hearing about what was relevant. And why that corporate rep deposition was cancelled and the next day he was noticed when they don't have enough information to depose the individual that would be able to meet all categories they came in and argued about 13 days before but suddenly they can depose Mr. Young who has nothing and from whom they have seen nothing, is the paradox.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0940 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 He's the Apex. That's a heavy burden. They haven't met it.

2 THE COURT: Mr. Wargo 3 MR. WARGO: Yes, your Honor?

4 THE COURT: -- TMX Finance is the company that's at the top of this pyramid, correct?

6 MR. WARGO: So to speak, yes, your Honor.

7 THE COURT: Well -- 8 MR. WARGO: Here's why I answered it that way: 9 What we made a matter of record in this court, if you look at their lOK, their filings, they themselves -- themselves treat all of these entities as one.

12 In fact, one person who reported to him, Linda McDonald, when we took her deposition, she didn't even know who her employer was. And, in fact, when she was stated who her employer was, she made -- she was -- a nonentity. Doesn't even exist.

16 So, your Honor, we can say it that way; but it's not how it works in reality. I understand that there's a company here and there are Texas companies, but they are all one company.

19 THE COURT: If they're all one company -- 20 MR. WARGO: Yes.

21 THE COURT: -- doesn't that mitigate against your assertion that because TMX Finance only has one employee then I should be able to take TMX Finance's employee's deposition since we are alleging that TMX Finance is a bad guy here?

25 MR. WARGO: Your Honor, I think you just said what my CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0941 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 argument is. And, so, I misheard you. TMX -- 2 THE COURT: No. If they are only-- if they're just one entity 4 MR. WARGO: Yes.

5 THE COURT: acting as one entity and he's the CEO, is there anybody above him in this structure?

7 MR. WARGO: No, your Honor. There is no one above him in this structure, but that has nothing to do with whether he has relevant information. And with regard to a Defendant in this case, is -- and they haven't disputed this, your Honor, I want to make two things very clear: 12 She argued and I get to distraction talking about no corporate representative deposition. That is nothing to what we are arguing about here. What we're arguing about here is whether Tracy Young has relevant information.

16 Your Honor asked us to assume the Apex Doctrine applies. It doesn't, but we were going with that. She didn't even try to say that it applies. And I know your Honor asked us to assume that -- 19 THE COURT: Wait. Wait. Wait. Ms. Lovett did say the Apex -- 21 MR. WARGO: Yes, your Honor. She didn't argue that, in fact, it applied based on your you asked us to assume that it does. When you look at the facts of the Apex Doctrine and you look at the law, there is no dispute. There are three or four cases. The Apex Doctrine requires a whole bunch of people reporting to someone CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0942 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 who is really too busy taking care of business.

2 Your Honor, we have the flattest of flat organizations here.

3 TMX Finance is a Defendant in this case. That's undisputed. TMX Finance has one employee: 5 Tracy Young. That's undisputed.

6 TMX has one member. That's undisputed. TMX Finance has one --what's the last one-- manager. That's undisputed.

8 It's all Tracy Young. And what I am pointing to you is their own letterhead coming from TMX Finance says we are looking at overseeing everything in Texas and we are making a representation to you, SMR, LoanStar, that we got the ball. We're not doing anything wrong.

13 That shows knowledge. That shows personal information. And that all tracks back to literally -- and they haven't disputed this one person they can call on the CEO and he is -- and he happens to be the CEO of other entities. But that doesn't negate the legal significance of this document, your Honor.

18 I'm entitled to argue to a jury that TMX Finance, their only guy, is a bad dude because he has knowledge going back to 2012 purported to do something about it and didn't. I'm going to argue that in front of a jury. How can I make that argument if I don't depose him and find out what he's going to say? He's the only guy.

23 So, your Honor, I would like to make one other point, if I could take a sip. They submitted an affidavit from him in this case, and it's interesting what it says and what it doesn't say. And CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0943 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 that's found on their Motion for Protection and on page 2 -- it's a very short affidavit. At the top.

3 THE COURT: What exhibit?

4 MR. WARGO: I believe it's the only one, your Honor.

5 THE COURT: No. I see A through K.

6 MR. WARGO: It's B. I apologize.

7 THE COURT: Thank you.

8 MR. WARGO: It's the only one in mind because you don't need to look at the others -- 10 THE COURT: You're right. Okay.

11 MR. WARGO: in my opinion.

12 Your Honor, on the second page of B -- now, remember Mr. Gannaway made representations to your Honor, which I have not been contradicted here at all in oral argument nor in affidavit, and that is what I told you that this is the flattest of flat organizations.

17 Okay. So, what this would have been the affidavit to say, i8 oh, wait, there are other people whom have information in TMX Finance. Its own legitimate, separately legal entity that will be a Defendant in this case that I'm going to have to argue to a jury needs to be tagged.

22 And what is my evidence? It's this letter to start with.

23 This letter is TMX Finance and TMX Finance making a representation that nothing is wrong. I'm entitled to depose the guy-- the only guy. That's your record here your Honor, the only guy made this CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0944 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 statement.

2 And I'm entitled to depose him. It's that simple respectfully.

4 THE COURT: But that statement is not made by a TMX Finance person.

6 MR. WARGO: It's made by a lawyer on behalf of TMX Finance.

7 That's what it says. That's just what it says. ''Agent,'' your Honor.

8 And it's on behalf of TMX. We've sent the letter to TMX Finance, and TMX Finance wrote back.

10 There's only one person, your Honor. And I get to tell the a jury that is the guy. And getting to my affidavit -- their affidavit, your Honor, I do not have -- here's -- here's the sum total of, hey, I don't know anything. I do not have any first-hand personal knowledge of relevant facts concerning the subject matter, blah, blah, blah. Gosh darn it, your Honor, I am pretty sure Tracy wasn't stuffing envelopes, wasn't in the back room getting on the computer stealing our customers.

18 That's not the theory of our case. But people who worked in his organization did, and we've deposed them and what this is the wiggliest of wiggle words: 21 I do not have firsthand personal knowledge.

22 Your Honor, respectfully, he doesn't need to for him to have relevant evidence. It's what the company's knowledge is that I get to argue to a jury they knew at the time they said they didn't know.

25 They knew this is a lie. He had relevant firsthand -- maybe not CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0945 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 firsthand. We're all lawyers. We know what firsthand is. But Tracy Young I'm going to argue to a jury knew what was going on, orchestrated what was going on and it goes to the very top of this one entity and there's only one guy. He's in charge.

5 THE COURT: What evidence do you have that he orchestrated what was going on?

7 MR. WARGO: Your Honor, we have evidence that Tracy Young is the guy responsible for everything that happens in this company.

9 That -- this is a small industry, your Honor. This letter was sent to TMX Finance because that's Tracy Young. Tracy is someone who has his hands in the business.

12 Okay. This is my client, LoanStar. They know who my guy is. Okay. This is a small industry. Tracy Young knows what's going on in his business. That's what we know.

15 THE COURT: How do you know that?

16 MR. WARGO: Your Honor -- 17 THE COURT: Because it's a small industry?

18 MR. WARGO: That's part of it. How do we also know is I have a letter from them.

20 THE COURT: Besides the letter, Mr. Wargo -- 21 MR. WARGO: Yes, your Honor?

22 THE COURT: Besides the letter, Mr. Wargo, what evidence do you have? And that goes to my very first question: 24 What evidence do you have that Mr. Young has relevant information in this lawsuit?

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0946 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 MR. WARGO: Their 10K, your Honor. Their 10K says that this guy, Tracy Young, every one serves at his pleasure, at his discretion. That he is the person who is in charge of all of the Texas -- of the Texas entities.

5 He has his hands in everything. Your Honor, their was recently a message that went back and forth between Tracy Young and the person who's in charge of our company where Tracy Young said I got it. I'm taking care of this. I'm going to make sure it doesn't happen.

10 He's making those representations within the last month.

11 That's the same representation that Vin Thomas is making that Tracy Young is going to put a stop to this.

13 So, your Honor, it doesn't even matter what I'm telling you on this point, respectfully. As a matter of law -- we are lawyers here. As a matter of law, there is only one guy. So, I can be entirely wrong about what I just said. I have one person in this one company to depose. And you're not going to let me? I respectfully think that's not fair, your Honor.

19 You're talking about what's fair? This isn't Ford Motor Company. They have less than a thousand employees. This guy can make some time to sit down and answer some questions about the veracity and what he knew about th~se kind of statements.

23 So, when you're telling me I have to go somewhere else, there is no where else to go. And they've never disputed that to this moment. I have no where else to go to get evidence about this CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0947 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 company, your Honor.

2 THE COURT: Okay.

3 MR. WARGO: Thank you.

4 THE COURT: Ms. Lovett?

5 MS. LOVETT: Would your Honor like to see a copy of the letter up close?

7 THE COURT: No. I got it.

8 MS. LOVETT: I understand. You know, it's sent from TitleMax. It's signed by the Deputy General Counsel of that entity.

10 It doesn't mention an organization. It says employees have been reminded. It doesn't say anything about Mr. Young.

12 And, I'm sorry, I am asserting that Apex Deposition applies.

13 We asserted that it applies in our Pleading that we filed with the Court. The Apex Deposition under Crawley Industrial absolutely applies.

16 He is the guy over those one thousand employees. I don't file 10K's for a living. I've never seen one that says he's the guy.

18 But if that's what the 10K says, your Honor, and if they came into this Court and arguing that a corporate representative had personal knowledge and important knowledge that he needed to be behind and your Honor ordered -- entered an Order on that and they pull it down and the next day it's all going to be Tracy Young, then it doesn't matter what Tracy Young said which might be a privilege settlement may or not be a communication.

25 So, the burden that they bear -- counsel's bear assertion of CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0948 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 ignore the Exhibits C through L, which, your Honor, are the deposition excerpts in which individuals repeatedly deny having any discussion about that with Mr. Young. The letters they are showing you is written by a company lawyer, which means that even if he did discuss this with Mr. Young there is a privilege.

6 So before we get to knocking down the door to the CEO's office -- even a thousand employees is a lot to me. Before we get to the CEO's office, there has to be some showing that he has relevant knowledge. And he may know that there is a lawsuit. That's relevant. Does that mean that you get to go and depose Bill Gates because he knows there's a patent infringement lawsuit?

12 Every single court that's looked at has said that's not prudent and it may turn out not to be such a good idea. But in this instance it's their burden and all they're bringing the Court is this letter which doesn't say it's on behalf of, by the way, the LLC.

16 It says we're responding to your letter directed to TMX.

17 It's on TitleMax letterhead.

18 THE COURT: Directed to TMX Finance?

19 MS. LOVETT: Well, yes. They show to whom to direct it.

20 TMX -- the one guy at TMX Finance, didn't respond to this.

21 THE COURT: But it is a letter in response TMX Finance, not TitleMax Texas or any of the other entities that are in this lawsuit.

23 MS. LOVETT: Fair enough, your Honor. But, again, if they want to take this letter and stick it front of the nose of every single person that testified and say were you warned, were you told CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0949 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 about this, were you -- did you discuss this and they had wished to actually if they came before this Court in good faith saying we need information from a corporate representative. The reason that's not a diversion or distraction is because the law requires that they show you that they have sought other means of obtaining the relevant information.

7 They told you that there was other relevant information.

8 They filed a Motion. They forced us into a hearing on it. You ordered it. They pull down the deposition, and then they noticed Mr. Young. There's no showing except for this one letter from a lawyer. The communications surrounding which would probably be privileged.

13 THE COURT: Okay. I am not ruling right now on this, but I will give you a ruling next week.

15 MR. WARGO: Thank you, your Honor.

16 MS. LOVETT: Thank you, Judge.

17 THE COURT: The next thing I have is a Motion for Continuance. I don't want to do that just yet.

19 MS. LOVETT: Can I correct a misstatement? I want to correct this on the record. It's not a thousand employees. It's 6,000. I am good at correcting.

22 THE COURT: Okay. Defendant's Motion to Designate a Responsible Third Party.

24 MR. GANNAWAY: Yes, your Honor. May I approach?

25 THE COURT: You may.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0950 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 MR. GANNAWAY: This -- to give to visual aid, direct the Court to page 15.

3 In a nut shell, your Honor, we have designated the PublicData and DataTrax entities, the companies that run those web sites, as people who are responsible third parties in this case.

6 As your Honor knows, Chapter 33 says what we have to do is designate any person who is alleged to have caused or contributed to causing in any way the harm for which recovery of damages is sought whether by negligent acts or omission by other conduct or activity that violates applicable legal standards.

11 And all we have to do at this phase, your Honor, is meet the bear Pleading Standards required by Texas Rules of Civil Procedure.

13 We've done that. We have listed a number of statutes and other applicable legal standards that we believe that these folks have run afoul on just on the basis of the testimony that we've heard from folks who ran searches and what they believe they were committing to when they saw the interfaces, for instance, on PublicData.com.

19 Now, they argue that we need to show that these folks would actually be found negligent. They talk about contributory negligence and all this sort, superceding negligence that would wipe out these acts.

23 Your Honor, they're talking about ultimate liability. And it may be under the old Chapter 33 regime that would have worked.

25 The Rule used to say you can designate one who could have been but CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0951 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 was not sued by the claimant and the person is or may be liable to the claimant. That's not the case anymore.

3 In 2003 it was changed to say: 4 If someone committed -- contributed to the harm in any way by conduct or activity that violates applicable legal standard.

6 And if you turn to page 17, I've cited the Unitech case out of the 1st District. That says: 8 An RTP can include people who aren't even subject to the Court's jurisdiction who might be immune from liability of the claim, your Honor.

11 We don't need to show that these folks are ultimately going to be liable or that they ultimately have breached a legal standard.

13 They don't even need to be liable.

14 THE COURT: Don't you have to prove that they did something wrong?

16 MR. GANNAWAY: I need to show they breached an applicable legal standard. That's what the Rule says.

18 THE COURT: Okay. They did something wrong.

19 MR. GANNAWAY: Yes, your Honor.

20 THE COURT: What did DataTrax 21 MR. WARGO: DataTrax.

22 THE COURT: What did DataTrax and PublicData do wrong?

23 MR. GANNAWAY: If your Honor will turn to page 20, I've given an of the applicable legal standard that hasn't been met here.

25 And this is from Diverse Policy Driver. I am not sure -- you know, CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0952 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 it's the centerpiece of their allegations. That says in Part C of USC 2721 in Chapter 18: ~ 3 An authorized recipient of personal information may resell or may disclose the information only for use per Subsection B.

5 That's the laundry list of permissible uses of what you can use these searches for.

7 And then I cited your Honor to 2nd Circuit case that evaluated that language. When a reseller like DataTrax, like PublicData, was excused of not having the right safeguards on their website -- and that led to someone getting personal information that resulted in an altercation where someone was physically hurt. So, the database provider was sued. And the 2nd Circuit said: 13 In light of the Texas legislative history, we hold that resellers are subject to a duty of reasonable care but before DTPP protected personal information.

16 And if you turn to the next page, page 21, you will see that allegations that the 2nd Circuit there thought were relevant were the same kind of allegations that we're making here: 19 We conclude that a reasonable jury can find they failed to exercise reasonable care when it disclosed the personal information.

21 One of the issue -- and I going to go over with your Honor, if you will turn to the next page. I've shown this to you before in giving you some background about how those databases. Page 22, says -- and there has been lot of testimony on this from lots of TitleMax former employers and employees. When they were running CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0953 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 searches, they all agreed with this and it says, quote, for any use in the normal course of business. And I will tell you it sounds like that's whatever anyone does at work might not apply to running a search.

5 If they're trying to locate -- even if you assume that everything they are saying as true, if they were trying to locate one of their folks so they can send out a mailer to them and trying to get them to convert and drum up some business, that's what those folks thought would fit into the normal course of business. Take that and ran the search and there was no suggesting that there was anything that they were doing was wrong.

12 There has been lots of testimony on that.

13 THE COURT: Except if you click on that link -- not filling in the space, if you click on the link, it describes what that means, doesn't it?

16 MR. GANNAWAY: That is true, your Honor. I'm sure they are going to argue that to the jury but that's factual. We just have a Pleading Standard here right now. And I did ask some of those folks did you click on this, did you know if clicked on it you could see a more full explanation. And the testimony to that was "no." 21 And then if you turn back to page 21, look at what the 2nd Circuit said about this sort of thing. There was a purpose there called "insurance other" that at least arguably is not a permitted purpose. And there is some statutory language that suggests that certain insurers can look up information related to insurance. But CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0954 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 "insurance other'' Court said that might not cut it but we don't need to decide that today, your Honor. That is a factual issue.

3 We made the Pleading that they have breached a legal standard that is certainly applicable to resellers like DataTrax and PublicData. And we don't need to show exactly what those interfaces do that but we've done that, your Honor. We've shown you where the confusion has been. We've already had testimony that there was confusion about and those folks thought there was nothing wrong with running these searches.

10 So, at this stage where we just have to make a bear bones pleading required by Texas Rules of Civil Procedure with, we have certainly shown where an applicable legal standard that arguably has been breached.

14 THE COURT: Yes, ma'am?

15 MS. ROMERO: Your Honor, Abigail Romero.

16 This is just another one of TitleMax's attempts to shift -- 17 THE COURT: Okay. You know something? Hold on a second.

18 Let's stop with the jury arguments. I don't mean to pick on you. I really wanted to pick on him. I really wanted to pick on him because the Pleading is loaded with it. It does absolutely nothing for me. 21 So, let's not hurl invectives. Just tell me why you think you're right.

23 MS. ROMERO: PublicData and DataTrax did not cause our harm.

24 The statute requires that the responsible third party have to cause or contribute to the harm. Our harm was 100 percent caused by CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0955 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 TitleMax, caused by their employees. And they misrepresented their purpose to PublicData and DataTrax. They're conclusively presumed to know the law.

4 So, even though we can get to all this other negligence and they violated an applicable legal standard if you want, but at the end of the day they didn't cause our harm.

7 TitleMax could have had their employees sitting at a computer running searches on our customers all day, that's not what damaged us. What damaged us is they have of our customers. It was the marketing. It was the theft.

11 In fact, once of their employees who did, in fact, sit down and run searches all day DataTrax sent that employee a letter saying you have overloaded our severers. We think you're not doing this for an inappropriate purpose; but, that aside, running searches, that doesn't harm us.

16 There is no way that they have satisfied the applicable pleading standards because there is no -- just no harm on the face of their papers. And we can get into the rest of if you want. We have a Statute of Limitations argument that also bars in large majority of their claims but there is no causation on the face of theirs.

21 MR. GANNAWAY: Your Honor, I appreciate the stipulation that running searches does not cause harm. It still doesn't mean that we can't designate RTP. She is jumping to a jury argument, as your Honor noted.

25 And even when she didn't start using the invective against CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0956 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 my client, she's still arguing that the facts don't support the RTP designation. We have pled facts. We have shown evidence already, your Honor, that support the RTP designation. We have gone far beyond the mere bare bones pleading standard required by the Rules.

5 And the only analysis -- 6 THE COURT: Wait. Hold on a minute. Hold on a minute. You said you don't have to prove that they caused harm?

8 MR. GANNAWAY: Well, I don't have to prove it at this stage.

9 Eventually we would have to show those contributed to the Plaintiffs' harm.

11 THE COURT: Is there anywhere in these -- what do you call them data information?

13 MR. GANNAWAY: Databases.

14 THE COURT: Databases have been brought in a lawsuit in the manner in which you're alleging that it should be?

16 MR. GANNAWAY: Well, I think one example out of the 2nd Circuit, yes, they have been sued in other areas for how they treated the resell of data and whether they were careful enough and followed the statutory requirement.

20 MS. ROMERO: Your Honor, if I may?

21 THE COURT: Just a moment? You are talking about Gordon v. Softech International?

23 MR. GANNAWAY: That's correct, your Honor.

24 THE COURT: And what is --what's the fact situation in that case?

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0957 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 MR. GANNAWAY: Try to recite as best as I can recall it, your Honor.

3 I believe that someone got in an altercation on the streets.

4 Got in an argument and one of the individuals involved in the altercation went home -- 6 THE COURT: Okay. Go ahead.

7 MR. GANNAWAY: Went home and ran a search to try to find -- they had I guess the license plate of the other person who they got in a fight with. They looked up that information and tracked him down and I guess beat him up. Something to that affect is what I recall.

12 The person who got beat up then sued the person who beat him up and the database provider for having made available the information and not taking enough steps to protect someone being able to access.

16 I think that's parallel to what we have here. Particularly here all we have to do is meet the pleading standards. We just have to show that they contributed to the harm. Folks have testified if I had known this was illegal, if there was something on that PublicData screen that said you can't run this unless and gave the full statutory language and explained what's wrong with it, then I would not have run the searches.

23 So, it directly impacts the damages that they're claiming.

24 It might have been zero damages if there had been something in here that would have let people that want to abide by the law know that it CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0958 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 might not be permissible to run the searches.

2 THE COURT: Yes, ma'am?

3 MS. ROMERO: This case that that Geoff's talking about right now not at all the same as this one.

5 In this case the Plaintiff was the person whose information was searched. They're the ones that were harmed. PublicData and DataTrax did not harm us at all.

8 They gave away Gordon's information in this case. That is not this case. Not at all.

10 MR. WARGO: Your Honor -- if may interject, your Honor?

11 THE COURT: You may.

12 MR. WARGO: Your Honor makes decisions like this all the time. Pleading standards where someone has improperly alleged causation, as your Honor has pointed out. Your Honor, here this is a bridge too far. That case is entirely inapplicable to our case.

16 There is direct linkage between the search and the harm.

17 Here, we have a bunch of people for purposes of this argument who we think we've already proven this those your Honor we will prove it to a jury where they are in a room taking our information and soliciting our customers and stealing.

21 These folks are in the middle of all of this and the only -- and they are the ones, as Ms. Romero pointed out, they are the ones who have caused our harm.

24 Your Honor makes these decisions all the time on Pleading Standards. I'm sorry, this is a bridge too far. You haven't caused CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0959 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 the harm here. This is a like saying there a vendor. These people, your Honor -- DataTrax -- these are vendors. So, is a copy service.

3 So, is a currier service that couriers these documents in between their various offices in order to distribute these materials.

5 THE COURT: But if they hadn't had access to the database, I'm sure Mr. Gannaway would point out, they would have never found out that that customer was a TitleMax customer.

8 MR. WARGO: And your Honor can recognize as a judge that the State of Texas has said this is a legal enterprise and making that information available is legal.

11 And if I can bring this horne? Geoff just gave away exactly why he loses this argument. He said -- and I wrote it down as best I could -- that he's taLked to he's taken people's depositions where they said if I had known that was illegal, I wouldn't have done it.

15 That is the core of our response to them. As a matter of law, your Honor, you cannot state a cause of action based on his argument. If I'd just known this was illegal, I wouldn't have done it. As a matter of law, that is not a cause of action. That cannot be a claim, and that's what they're basing this claim on.

20 THE COURT: As a matter of law according to who? You throw that phrase around a lot, Mr. Wargo.

22 According to who as a matter of -- 23 MR. WARGO: Ignorance of the law is no excuse to saying, please, I shouldn't do this. That's all I am referring to when I say that, your Honor.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0960 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 He's making his argument, gee whiz, if I had only known this conduct was illegal I wouldn't have clicked on here. Your Honor, the -- our Justice System would cease to exist if we don't have the rule that says you, everyone, is presumed to know the law and you cannot claim ignorance of the law.

6 THE COURT: So, you're saying that someone signs on PublicData or DataTrax they're supposed to have knowledge of a complicated federal statute which precludes them from using that database for a certain specific purpose?

10 MR. WARGO: I don't have to say that here, your Honor. All I'm saying in response his Motion, he cannot base his Motion on what at the bottom is something that is not a legal principal. That is, I should-- if I had only known the law, that's what he has to go do in order to meet many Pleading Standard, your Honor.

15 If he came in on an entirely unrelated case and said in a Pleading if I had only known this was illegal I wouldn't have done it, you'd throw that out of court.

18 You can't say someone --you can't maintain a cause of action because, oh, gosh, if I would only known about the law.

20 That's his claim right here. You'd throw that out of court and that's what he's basing this on, your Honor. And that's why it doesn't even meet the minimal standard.

23 In addition to, he has not made any showing and we have already come forward with evidence in this case that they're not the cause. That these people, PublicData.com, they're not the cause.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0961 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 They're the cause of the damage -- of the harm as the statute points out.

3 Thank you, your Honor.

4 MS. LOVETT: Your Honor -- 5 THE COURT: Yes, ma'am?

6 MS. LOVETT: What Mr. Wargo said that you would -- you would evaluate on pleading standards all the time. Of course, you and I know is incorrect because don't have a 12(b(6) here in Texas. That's the difficulty many of us have struggled with.

10 While I'm a proud Los Angeles Lakers fan at the annoyance of all my friends in Houston, the bottom line is in Texas there is no Pleading Standards that Mr. Wargo is describing.

13 The standards under Rule 33 as now amended is caused or contributed to. And that's what would give you, for example, a Dram Shop case. The drunk driver is the person that killed the person.

16 That doesn't mean you can't name as a responsible third party the bar.

18 Cause or contributed to. The standard is brought. There is no -- we are not here on a Motion to Dismiss posture because there isn't one in this case. We are here on the simple posture of whether or not you can identify a responsible third party. And the pleading standards for that simply is that they caused or contributed.

23 Here's the contribution because it's the searches and, now, we have the stipulation on the record that these searches didn't harm-- didn't harm LoanStar.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0962 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 We will deal with that, I'll assure you. But if the searches hadn't been done, then the question becomes is there a causal connection. Is there some nexus there that destroys our responsibility and creates or adds them into the picture. And that is exactly what our Third-Party Responsibility Statute is designed to do.

7 So, the pleading standards there is not what someone would have to do in a federal case on 12(b) (6). The standard is simply what Mr. Gannaway articulated: 10 Could they? Have we pled facts? We may not be able to prove them. They may not be able to prove theirs. But have we pled facts that these third parties contributed? Your Honor, .that's undisputed those searches were done. That's where the information came from.

15 THE COURT: Anything else?

16 MR. GANNAWAY: Your Honor, I would just point out knowledge of the law means that we can't plead this, if you look at the Garcia v. El Paso Limited Partnership case, it says: 19 Criminal actions that are a foreseeable result of a prior tort do not excuse the previous tortfeasor liability.

21 That's dead on kills Mr. Wargo's argument.

22 THE COURT: Okay. I'm going to grant the Motion. That doesn't mean that it's going on the Charge. It only means that today we will consider it if there's evidence to support it.

25 MR. WARGO: Thank you, your Honor.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0963 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 MR. GANNAWAY: Understood, your Honor.

2 THE COURT: Plaintiffs' Motion to Enforce Orders and for Sanctions.

4 Mr. Johnson-- let's go off the record for a second. I don't want this on the record.

6 (Brief discussion off the record) 7 THE COURT: With that said, Plaintiffs' Motion to Enforce Orders and for Sanctions.

9 I guess the Plaintiffs' argument here is there are two Orders here I've signed. One of which specifically relates to the Overlap List that the Defendants are not complying with and they should be punished for it.

13 Have I characterized your argument, Mr. Wargo?

14 MR. WARGO: Your Honor, the last word I wouldn't use "punish" given what you just indicated on off the record. But, your Honor, I wiil tell you I've maybe in my career filed about five of these.

18 THE COURT: Okay.

19 MR. WARGO: So, I want you to know this isn't something that we routinely do and, you know, Mr. Johnson and it's not something that he's going to routinely do.

22 But we have a few Motions here -- are happy to start with the Overlap List -- that simply have not been complied with over a period of time.

25 And I know Mr. Johnson has -- he's been on the front line CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0964 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 with Mr. Gannaway. They have had, you know, those discussions. And, so, he will weigh in as he deems fit. But, your Honor, we have demonstrated I believe -- perhaps using too many adjectives and I will take responsibility for that, your Honor.

5 We will make sure to curb our conduct going forward, your Honor. Your Honor, we have documented -- putting aside those words that gave you pause systemic refusal to engage in the Discovery process that truly slows this case down dramatically. And we put in our papers no overstatement has brought it to a stand still.

10 Your Honor, this is the only -- the Overlap List of the Motion is where I would like to go back a little bit in time. The other ones I will not do this, your Honor, but I think it's instructive and I will do this as briefly as possible.

14 Your Honor, the Overlap List was created out of a Consent Rule 11. And that goes back to the very infancy of this case. And that goes back, your Honor, to around September -- July/September of 2013.

18 Now, your Honor, you may not remember this and I doubt that you do but we sure do: 20 A couple of weeks after we got their data, our client looked at this -- this being a small industry -- and saying, gosh darn it, that's too small of a list. There's no way that that's accurate except 24 THE COURT: Hold on just a second. It's now 4:00 o'clock.

25 MR. WARGO: Your Honor -- CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0965 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 THE COURT: So, let's short circuit this just a little bit.

2 MR. WARGO: Yes, sir.

3 THE COURT: I signed an Order requiring that the Overlap List be updated.

5 MR. WARGO: Yes, sir.

6 THE COURT: Requiring that certain information be provided within a certain period of time. It's your allegations, am I correct, the information has not been provided to Judge Peoples so that he can prepare the Second Amended Overlap List?

10 MR. WARGO: My understanding is on November the 6th or 7 that data was finally produced by Mr. Gannaway.

12 THE COURT: Okay.

13 MR. WARGO: Yes, your Honor.

14 THE COURT: Okay. So, Judge Peoples is now working on this second Overlap List.

16 MR. WARGO: Yes, your Honor.

17 THE COURT: And your complaint is that the Court ordered him to do that a while back?

19 MR. WARGO: Yes, your Honor.

20 THE COURT: And he's been quite tardy at doing that?

21 MR. WARGO: Yes, your Honor. And a bit more than that.

22 THE COURT: A bit more than that?

23 MR. WARGO: Yes, your Honor. A bit more than quite tardy.

24 THE COURT: Okay. Mr. Gannaway?

25 MR. GANNAWAY: Yes, your Honor?

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0966 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 THE COURT: They're complaining about three specific Orders not being complied with.

3 MR. GANNAWAY: Yes, your Honor.

4 THE COURT: Have you complied with each of these three Orders?

6 MR. GANNAWAY: Every single one of the issues raised in the Motion to Enforce has now been completed, your Honor.

8 THE COURT: Okay. When were they completed?

9 MR. GANNAWAY: Some of them were completed last week with respect to the Amended Discovery Responses. The Special Master List was completed on August the 11th when your Honor ordered us to provide. You gave us 28 days from the day you gave the Order. We submitted those.

14 In October the Plaintiffs said we believe there is some records that are missing. We saw them on the first Overlap List. We don't see them on the second.

17 We investigated internally, and we found that the problem was -- I will try to get into as few details as possible but to explain to you the problem: 20 One of the fields that we have to provide to the Special Master is the secondary Social Security number. There's always a primary Social Security number associated with an account. That's the borrower. Sometimes there's a co-signer or a co-borrower.

24 We discovered that in many instances the secondary Social Security number was missing in the list that we provided pursuant to CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0967 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 your Honor's Order on August the 11th. And we worked to fix that as quickly as we can.

3 We're talking about a list that generated 485,000 entries not reflected, your Honor, to cull from the Defendant's databases and we have been hampered, as I've explained in the Motion by the fact that every time we have been ordered to produce a new database that we had to produce a new list for the database instruction by the Special Master.

9 We have had a new IT person that has to do it because there has been a lot of turnover at TitleMax. So, it's a new person that has to cull the database properly. So, we have corrected that issue.

12 Your Honor gave us 28 days to do the first instance from the time that we identified the issue or they identified the issue. We completed our investigation and provided them a new list. It was 24 days. We are doing our level best to comply.

16 We understand that that was a mistake. We told them it was a mistake, and we provided the list as quickly as we could and we told them we would pay for the Special Master process, for the corrected process.

20 We've done all we can, your Honor. There is no bad faith here whatsoever.

22 THE COURT: Has the Defendant provided you with Responses to Discovery that are contained in these Orders that you're complaining about?

25 MR. WARGO: No, your Honor.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0968 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 THE COURT: Which one?

2 MR. WARGO: In part.

3 THE COURT: Which ones have they not complied with?

4 MR. WARGO: Your Honor, the marketing portion.

5 THE COURT: Which Order are you referring to?

6 MR. WARGO: Your Honor, I'm referring to your Order dated August 19th. They have entirely failed to comply with one aspect of this in that with elucidation and I will show they have also failed to comply with the other. In particular talking about Paragraph 5.

10 THE COURT: Tell me the date again.

11 MR. WARGO: Your Honor, August 19th of this year. It's about the July 18th hearing. Paragraph 5, your Honor.

13 THE COURT: I got it.

14 MR. WARGO: Thank you, your Honor. May I?

15 THE COURT: You may.

16 MR. WARGO: Your Honor, your Honor specifically ordered -- and I'm going to the center of that Paragraph 5 well. I will just go: 19 Defendant shall identify the employees of TitleMax Finance of Texas, Inc., and TitleMax of Texas, Inc., by full name, address and job title who were involved in the approval of buy-out letters and fliers used to solicit customers of Plaintiffs.

23 That's Bucket No. 1.

24 Bucket No. 2: 25 And the marketing strategy of using databases to identify CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0969 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 customers of competitors.

2 Well, your Honor, on Bucket No. 2 they have never identified any one at all at any time who on using your Honor's Order provided or were instrumental in providing information regarding the marketing strategy of using databases to identify customers or competitors.

6 Never ever ever. Even after they supplemented to address the first portion of that, your Honor. And I would like to address that because that's supplementation is false.

9 So, I will break them down. Whatever is easier for your Honor. But your Honor asked me to respond specifically. They've never given us any person who was involved in the marketing strategy.

12 THE COURT: I got that.

13 MR. WARGO: Yes, your Honor.

14 THE COURT: What else?

15 MR. WARGO: And that on the first part they were instructed and ordered to provide persons -- your Honor, I won't read it again -- who were involved in fliers in the creation of them and the approval -- where is that -- approval of buy-out letter to solicit the customer.

20 THE COURT: So, you're saying they haven't complied with Paragraph 5 at all?

22 MR. WARGO: Well, your Honor, with regard to Paragraph 5, they name people who were low-level people in Texas and they -- and they did that based on deposition testimony.

25 Your Honor, they named no one within -- who was in the CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0970 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 marketing department in corporate in Savanna who was responsible for this, your Honor.

3 If I may 4 THE COURT: What if no one from the corporate office in Savanna was responsible these two items?

6 MR. WARGO: From the deposition, your Honor, of an Austin District Manager taken in this case named Michael Bryant, I quote: 8 "The fliers that were created in your district were typically created at the store level?

10 "Yes. But we also used a standard flier -- a company "standard flyer.

12 "And that's something that's created by the marketing "department?

14 ''Yeah.

15 ''In the corporate office.

16 ''Uh-huh.

17 "Was that standard flier to your knowledge -" 18 This is the key: 19 "Was that standard flier to your knowledge ever sent to any "of the individuals listed on these customer lists from DataTrax?

21 "Answer: I'm sure they were. It was a corporate flier.''

22 Beyond that, your Honor -- may I approach?

23 THE COURT: You may.

24 MR. WARGO: I've given you three documents. I am handing copies to Mr. Gannaway. One of them I had from my reference was CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0971 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 entitled "Georgia." I put a yellow sticky named ''Georgia.'' That's this one, Geoff. One "Virginia'' and the other "Georgia." That is this one here.

4 THE COURT: Mr. Gannaway?

5 MR. GANNAWAY: Your Honor, you are not going to see any difference between these copies of fliers. The first one is evidence of this case. It's the Texas case. And the evidence in this case, your Honor, is that the first one named "Texas" was one of the fliers that was used to go after our clients through the DataTrax/PublicData.com method. That is the first one I gave you, your Honor.

12 The second one we got in Virginia last month from TitleMax.

13 The third one we got in Georgia from TitleMax last month.

14 Your Honor, these are -- certainly the first and second are exactly the same. The third, if you will look at the dollar bill and verbiage on there, it's virtually identical. The serial number is the same 50-dollar bill.

18 Your Honor, we have direct evidence from a former district manager that these fliers were approved by corporate. I just read you that testimony.

21 THE COURT: Okay. Mr. Gannaway?

22 MR. GANNAWAY: Your Honor, this is death of a thousand cuts.

23 We have been through this before. When you signed that Order, we asked your Honor to reconsider it. While it was being reconsidered, we had a hearing on September 22nd when this precise issue was CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0972 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 discussed again with your Honor. And this is what Daniel Johnson says with respect to what they were looking for because I said I need them to narrow the universe of what they he said.

4 So, what he said: 5 So, what we agreed to on the record, while we are specifically looking for these targeted -- these fliers and the fliers that were sent out to directed specifically towards buyers of competitors loan, that is all we are looking for. So, you know, company-wide marketing strategies we are not interested in that.

10 And I explained here to your Honor that I was going to go through deposition testimony and try to identify those specific types of non-company wide things that they are complaining. Specific things that were generated at store level against our company policy to send out mailers and fliers.

15 You directed me to review the depositions to see if the exhibits dealt with that and if there was testimony that showed that.

17 I did that, your Honor. You also asked me have I inquired -- have you, Mr. Gannaway, inquired to the areas of managers -- regional manager of the Dallas area.

20 I said: I have not, your Honor.

21 You said: Okay. Do so. 22 I said: Will do.

23 You said: And then carry on with what you're doing right now identifying these items.

25 I reviewed all those depositions, your Honor. I have CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0973 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 updated my Responses accordingly, and we've inquired with the Dallas Regional Manager exactly as you said.

3 We have updated our Discovery. And this stuff about company-wide strategy stuff that Mr. Johnson told you he wasn't interested in, is beyond anything that could possibly be relevant to this case.

7 Why does it matter who approved a 50-dollar bill? That's why Mr. Johnson agreed that we didn't have to look if the -- with respect to responding to this Interrogatory.

10 MR. WARGO: Your Honor, you before Mr. Johnson respond s, I would like to add one more thing. It certainly matters who approved the bill because their Georgia entity we have to show to a jury is culpable here, too. I have a jury argument to make that people in Georgia were involved in this as well.

15 Your Honor, the problem with Mr. Gannaway's argument that I would like to say before Mr. Johnson jumps in is that he is arguing something that happened at a hearing.

18 Unfortunately-- or fortunately for us there's an Order from the Court that I just read to you that you have on your screen. Your Honor, he moved to modify this. Your Honor denied. So, here is his Response and I would like to quote: 22 In the face of your Honor's Order, here is his Response: 23 Based upon a review of the deposition transcripts and communications by Dallas Regional Managers, pursuant to this Court's direction, Defendants respond that the following people apparently CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0974 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 played a role in designing, preparing and/or approving letters and fliers offering to buy out competitors' loan.

3 And then he lists people who have been deposed. Your Honor, we fought this. It is death by a thousand cuts. That's why we are asking for our fees because we're here a third time. We moved to compel. We've had a couple of hearings on this. It resulted in an Order.

8 And the information that we are seeking is critical to our case. It goes to the letters that were stuffed in the envelopes that came to us to say -- from our customers saying what's going on here.

11 There are the very letters that they brought customers to TitleMax.

12 There couldn't be anything more relevant to this case and whether Georgia-- I'm sorry Savanna approved those letters shows the corporate knowledge that we are going to need to show in this case.

16 And Mr. Gannaway's response is quite telling, your Honor.

17 He doesn't abide by your Honor's Orders. He's calling it direction, and I am quoting from him. And he's also saying that these people apparently played a role.

20 Your Honor, we're entitled to know who created this and whether this was part of the company and whether it was part of a company's sponsored event.

23 MR. JOHNSON: All I want to the say is I don't think that is an accurate characterization of what was discussed.

25 THE COURT: He's reading the transcript.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0975 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 MR. JOHNSON: I understand that; but the broader discussion, your Honor. And I have read it. I read right before we came down to the courthouse. What we were talking about is I don't care what the corporate strategy is for marketing in Georgia. I don't care what it is in Virginia. I don't care about that stuff. But as to the buy-out letters that were sent to our customers in Texas, we want to know who created those. And what you have in front of your Honor is evidence that somebody -- somebody in Texas didn't create that and send it to Virginia.

10 This is some decision was that was made by the corporate office, and that is exactly what we are looking for because those were sent to people in Texas. It's in the middle of our case, your Honor.

14 THE COURT: Mr. Gannaway 15 MR. GANNAWAY: Yes, your Honor?

16 THE COURT: how difficult would it be to identify the person in Savanna or wherever it was who created this marketing?

18 MR. GANNAWAY: May I consult with my client, your Honor?

19 THE COURT: You may.

20 MR. GANNAWAY: We could tell them who created this flier.

21 THE COURT: Why don't you?

22 MR. GANNAWAY: We will, your Honor.

23 THE COURT: Because all you're doing-- yeah, it's death by a thousand cuts. But you're bringing us such a lit bitty --a little bitty problem to the Court and it's causing all of this commotion CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0976 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 here.

2 It's a simple thing to do it. Just do it. Identify the person that created this marketing strategy. Period. Just do it.

4 MR. GANNAWAY: Will do, your Honor.

5 MR. WARGO: Thank you, your Honor.

6 THE COURT: What else do you not have?

7 MR. WARGO: What I don't have is the second part of your Order, Paragraph 5, your Honor. They've never given us anything at all, zero, with regard to the marketing strategy of using databases.

10 THE COURT: Okay. Is there a marketing strategy of at TMX involving the use of databases?

12 MR. GANNAWAY: Absolutely not.

13 THE COURT: Why don't you admit -- why don't you acknowledge that, and just say there is no such marketing strategy?

15 MR. GANNAWAY: I've said that it was not approved by corporate. That's in the Interrogatory Response that we served even before the later version that we amended.

18 MR. WARGO: Your Honor, they have not answered this question. And if they want -- 20 THE COURT: If there is no one who has approved or participated in the marketing strategy, what else do you want them to say?

23 MS. GOEBELSMANN: Your Honor -- 24 THE COURT: No. I am asking Mr. Wargo.

25 MR. WARGO: I want to lock them down and he is not telling CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0977 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 you the answer. They did not answer this question, your Honor.

2 THE COURT: Within 14 days of the hearing Defendant shall identify employees by name, address, job title who were involved in the approval of buy-out letters and fliers used to solicit customers of the Plaintiffs' and the marketing strategy of using databases to identify customers of competitors.

7 If they say there are no individuals involved in the marketing strategy of using databases to identify customers, which is what I hear Mr. Gannaway is saying and I'm presuming that he said that in response to Discovery -- 11 MR. WARGO: He did not.

12 THE COURT: Well, if he didn't, then you need to.

13 MR. GANNAWAY: I will read it to, your Honor, if you would like.

15 THE COURT: Where did you answer that question, though?

16 MR. GANNAWAY: Supplemental Answer to Interrogatory No. 4.

17 THE COURT: And when was that sent out?

18 MR. GANNAWAY: I don't have the date, but it was months ago.

19 THE COURT: What does it say?

20 MR. GANNAWAY: It says: 21 As limited by agreement with counsel -- because we had a meet-and-confer session -- Defendant states that no one had authority or was responsible for the designing, preparing and/or approving marketing approaches certain employees that were targeted customer known to have a third-party title loans. The marketing materials CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0978 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 used were not approved by the marketing department. And, therefore, were against policy.

3 MR. WARGO: That is correct, your Honor.

4 He has not responded to this. If that were accurate, your Honor, what were talking about at the hearing?

6 THE COURT: I don't know because that happened months ago.

7 MR. WARGO: Yes, your Honor.

8 THE COURT: And I've had a couple of thousand hearings since that date.

10 MR. WARGO: Understood, your Honor. And we are happy to take this representation where he can supplement -- we are happy to put in the supplement answering. That is all. We just want to lock them down.

14 MS. GOEBELSMANN: Your Honor, just by way of context since it was a July 18th hearing where this was discussed occur before I think that response that Mr. Gannaway is referring to was on behalf TMX Finance, LLC, only and we did move to compel a further response to that Request they had responded to it. However, we did move to compel with respect to the Texas entities that are -- 20 THE COURT: Okay. Okay. Fine. Provide them with a Supplemental Response and answering it specifically in response to this Order.

23 MR. GANNAWAY: Yes, your Honor.

24 THE COURT: Is there anything else that has not been produced pursuant to an Order of this Court?

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0979 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 MR. WARGO: Your Honor, the answer to that is -- as far as we can tell right now the answer is they have supplemented as of this past week and we think that they have complied.

4 And I do want to keep my Motion for Sanctions, though, as something for your Honor to consider. Because we're only going to be back here again if your Honor doesn't take some action, as your Honor just said and you got exercised about it and I don't blame you, we are here on the little tiniest of things.

9 And if we aren't going get some corporation in response to the little, tiniest things we are going to be filing more Motions to Compel and then Motion to Enforce. That's why respectfully, your Honor, and I know it's late and I know it's Friday but our Motion is substantial with regard to their numerous failures to respond, failure to -- and Mr. Gannaway -- Mr. Johnson asked hi.m can you give me a date about when you're going to comply. And he said that's a reasonable request and he never does.

17 Your Honor, respectfully, if you don't take some action about their failure to respond to these things in the ordinary coarse, we are going to be back here again because we are dealing with things that are basic. These are things counsel always agrees to your Honor. Always.

22 THE COURT: Well, that is not necessarily correct, Mr. Wargo. I can assure that these items in this Order were not agreed to by counsel for TMX.

25 MR. WARGO: Your Honor, Privilege Log, responding to -- CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0980 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 THE COURT: If it was agreed to I wouldn't have ordered it.

2 MR. WARGO: No. I'm saying it's something counsel typically agrees to and everything is a fight. Everything is a Motion. It's because we are not getting anything coming back requiring us to file Motions and take your Honor's time.

6 THE COURT: I'm not awarding sanctions at this time. But if we come back in here again on tardiness in responding to things, then I will take it under advisement --consideration. But I'm not going to at this point in time.

10 He did respond last week. I know it was -- probably your argument is, well, it was done pursuant to or in response to these Motions. I appreciate that. We're just going to let it go at this point and deal with it.

14 But if it happens again, Mr. Gannaway, I can appreciate their concern because you're responding to things and I don't know the whole story and I will acknowledge that, which is one of the reasons why I'm not asserting anything. But getting information from TMX seems to be a bit burdensome. And you didn't respond to some of these things until last week, which could be interpreted as being a response because of Motion for Sanctions was pending.

21 MR. GANNAWAY: Your Honor, I told them that I would get all of -- they said they needed this information before the corporate representative deposition. I told them I would have it in advance.

24 There was no date set with respect to anything that's in front of your Honor other than that Special Master list.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0981 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 But I understand your Honor's frustration.

2 THE COURT: I'm frustrated because I have a handful of cases that require Friday afternoon. 11 Motions all in one? This is not the normal way cases run in Houston. Probably not in -- 5 MR. WARGO: Georgia.

6 THE COURT: Georgia.

7 MR. WARGO: Atlanta.

8 THE COURT: That's what I thought it was. I didn't know if it was Atlanta or LA. 10 Okay. Come on, people, let's bring some rationality to this -- is that a word -- and move things along because y'all are one of two or three cases that require this kind of attention. And I appreciate the fact that neither one of you really want to go to the extent that I'm ordering you to produce certain Discovery.

15 That said -- that's all I am going to say.

16 MR. WARGO: Thank you, your Honor.

17 MR. GANNAWAY: May I interject something at this point as far as scheduling?

19 THE COURT: Sure. If you don't mind me continuing to look for the proper Order to sign in this. Go ahead.

21 MR. GANNAWAY: I know that it's getting late in the day.

22 It's 4:20.

23 One of the issues that I think is more pressing from our perspective and needing a ruling we had set it for submission last week and the Plaintiffs requested that it be moved to this hearing CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0982 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 was a few Motions at issue regarding Third-Party Discovery.

2 Some of them have already been received with subpoenas.

3 THE COURT: You're talking about the Letters Rogatory?

4 MR. GANNAWAY: Yes, your Honor. The Letters Rogatory and there's also our Motion for Protection from Subpoenas already served and because apparently those folks might be thinking, your Honor, they are already under subpoena and starting to generate material that we would suggest are irrelevant and beyond the scope of Discovery that we address that issue if the -- we can.

10 MR. JOHNSON: I think this was the four-for-one, your Honor.

11 We can hopefully knock out four 12 THE COURT: I'm trying to figure out what -- you're talking about the Letter Rogatory to Online Guru, Acanum Investigations, Burbridge Detective Agency -- 15 MR. JOHNSON: Yes, your Honor. There were three Motions for Letters Rogatory and then we issued subpoenas and then they filed a Motion for Protection as to those and are all the same issues.

18 THE COURT: I'm trying to find the Motion.

19 MR. GANNAWAY: It was filed on Halloween, your Honor.

20 THE COURT: Is that an editorial comment on the Motion itself?

22 MR. GANNAWAY: Not at all.

23 MR. JOHNSON: May I approach, your Honor?

24 THE COURT: Just one second.

25 MR. JOHNSON: Sure.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0983 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 THE COURT: All right. The Subpoena Duces Tecum that you sent out you sent it to who?

3 MR. JOHNSON: We sent it to various parties, your Honor.

4 The Motion for Protection addresses several subpoenas in general and this is true as to the subpoenas and the Letters Rogatory they were directed toward third-party databases that will provide the same type of information as PublicData.com and DataTrax.

8 We have multiple witnesses in this case and we've cited the testimony in our papers where witnesses for TitleMax has said, look, we know this was a web site that we went to. Can't identify which one.

12 And, so, what we have done, your Honor, is we've done the spade work, which we have to do as Plaintiffs, to go and find evidence. So, there is not 50,000 of these companies out there.

15 There is a handful of them. And we have asked those entities some very narrow questions which are: 17 Do you have searches that were done that fall into the category of searches we looking for this this case.

19 Mr. Gannaway and I -- and I and Geoff and do get along very well despite the disputes that we have. And I pleaded with him. I said, Geoff, this doesn't cost your client anything. If we hit a dry hole with something, it doesn't impact anybody. It doesn't cost your client money. It's not a burden. Anything like that. But we should be entitled to find out since there are people that said ''yes" we use some web sites and we can't remember which ones. There was one CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0984 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 witness that said I've not heard of PublicData or DataTrax.

2 So, unless that other limited universe of database providers we wanted to know whether or not these searches were done. We have gotten a response from one of them already. And low and behold in the response we find in Integrity searches that were done. This is exactly why we did the searches, your Honor.

7 THE COURT: Mr. Gannaway -- 8 MR. GANNAWAY: Your Honor -- 9 THE COURT: what standing do you have to even raise an objection to these things? This is not -- Mr. Johnson is right.

11 This doesn't cost you a thing and that it's not your company that is being asked to produce documents. What standing do you have to complain here?

14 MR. GANNAWAY: Your Honor, under the Texas Rules, as you know, anyone affected by Discovery Requests.

16 THE COURT: How are you affected by this?

17 MR. GANNAWAY: We are affected by this because we -- for the databases that have been shown to have some link to the Plaintiffs' claim, those are PublicData and DataTrax, they have produced documents. There is a 30,000-page stack from PublicData almost all of which, if not all of which, was reasonable legal searches. But we have to go through and look at those 30,000 pages to see whether the Plaintiffs might claim about it.

24 As your Honor knows, there is nothing wrong with running these searches. In fact, the Temporary Injunction that we entered on CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0985 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 and agreed basis back last summer said Plaintiffs stipulate Defendant may continue to use these databases for legal purposes.

3 Their position here is literally, your Honor, because they have shown that PublicData and DataTrax were used, they can subpoena any database owner in the country and it's not a handful, your Honor.

6 A lot of people buy this information from DMV's including from Texas and beyond.

8 THE COURT: But it's a handful that they are seeking it from. It's three by Letters Rogatory, and I don't know about the third-party Deposition by Written Questions. How many of those?

11 MR. JOHNSON: There were five subpoenas, your Honor. And one of which we already have responses.

13 THE COURT: So, there's eight total.

14 MR. GANNAWAY: Your Honor, there is no logic to this from those folks to this case. What they said in their Letters Rogatory Motion, your Honor, was: 17 Through Discovery in this matter -- here's an example -- Online Guru, Incorporated has been identified as a person who has relevant facts during the relevant time period of Defendants' tortious conduct against Plaintiffs and may possess relevant documents.

22 They told your Honor that that person has been identified in this Discovery as a business with relevant facts. I did a double-take when I saw that Motion filed, your Honor, because I hadn't heard of Online Guru.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0986 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 I searched every bit of Discovery we have in the case. I took every transcript that has been taken in that case. That name and the database name associated with it and it has never come up.

4 Your Honor, if this kind of activity is permitted to go on, if subpoenas can be served to anyone in the world that runs a database whether for legal or illegal purposes that searches were done, there is going to be no end to the satellite litigation that's going to be involved in this case.

9 There is no way that we can try this case if they continue to generate issues for which there has been no proof that the documents that are produced are going to be relevant to this case and they are going to start trying to ask us to produce information regarding all of those searches that might have been and probably were for perfectly legal reasons, your Honor.

15 There is also no limit to what they are -- what they are requesting here. They haven't limited it in cases the Request for Production they've served on those people to Texas entities and your Honor might not know but a week or two ago these folks filed suit against TitleMax entities in Georgia the Wargo Firm on behalf I guess affiliated entities of LoanStar.

21 They appear to be using your proceeding, your Honor, to get Discovery for those other matters because what they've asked of these databases is not limited to Texas issues.

24 Your Honor, this is a fishing expedition pure and simple just because it doesn't make me produce something, doesn't make it CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0987 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 less of a fishing expedition they are not entitled to do under the Rules of Discovery, your Honor.

3 THE COURT: But what gives you the right to come in and complain?

5 MR. GANNAWAY: Because I'm affected by it.

6 THE COURT: How are you affected by it?

7 MR. GANNAWAY: Because if they generate a ream of paper that shows 50,000 legal searches that we didn't do skip tracing-- which no one is contesting. It's perfectly legitimate practice to use the databases. We are going to have to deal with that issue.

11 Remember, this all came up with respect to the filing they made with your Honor when they originally got in that PublicData production that they said, aha, we found some people that ran searches from TitleMax and they turned up Integrity lien holders.

15 And, so, we came to your Honor and showed you, your Honor, that is just a false non-secular assumption. And we showed you the very first search that they attached to what they pled in front of your Honor to say that we did something illegal and wrong in breach of the Temporary Injunction.

20 I showed you that was a TitleMax customer. There was nothing wrong with running those searches.

22 So, their Discovery is overbroad and it affects us because of the allegations that they've made wrongfully that that necessarily means that it was a wrongful search.

25 MR. JOHNSON: If that's the standard for affecting you, then CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0988 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 the whole notion under Texas Law that it has to affect you means that anyone -- any party can object to a Third-Party Subpoena. That's not the Rule.

4 The Rule is that it has to affect you and what Mr. Gannaway is saying we don't think you're going to find anything. I have stuff. We have found stuff. We found license plate searches that came up with Integrity liens. This is exactly what he doesn't want us to get.

9 THE COURT: Wait. Wait. What's the problem with the license search that came up with Integrity liens?

11 MR. JOHNSON: Well -- 12 THE COURT: With those license searches?

13 MR. JOHNSON: Well, your Honor, the point is that with this that these are our customers. ' There are searches being done based on the request that they ask.

16 There's an Email account here is from an individual named Blaze DeLeon. They have identified an individual supplementing their Response in the last two weeks Blane DeLeon who is an individual that they identified that has access to data accounts.

20 Okay. We think that we're entitled to learn whether Blase DeLeon is doing license plate searches on Integrity customers. Is he, in fact, engaging in conduct we are complaining about here.

23 These are third parties. Doesn't cost them anything at all.

24 They are not affected by this. And under the standard he's articulating, any party would be able to object to subpoenas in Texas CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0989 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 and that is not the Rule.

2 MR. GANNAWAY: Under the standard he's articulating, I can't object to any Discovery directed to third parties, your Honor. That is simply not the Rule.

5 How it affects me and my client is just laid out by what Mr. Johnson said if Mr. DeLeon -- is that his name?

7 MR. JOHNSON: Blase DeLeon.

8 MR. GANNAWAY: Mr. DeLeon ran searches perfectly legal for skip tracing and we have to then prove that through some theory that the Defendants have that that must mean that it was illegal, then it affects us, your Honor. It affects my client. It affects the work that we have to do and what they have to pay their attorney, frankly.

13 THE COURT: Okay. Motion for Protective Order is denied. I am signing the Letters Rogatory at this point. I don't know that I have an Order denying the Motion for Protective Order.

16 I have an Order granting it.

17 MR. JOHNSON: Let me see if we have one, your Honor.

18 MR. GANNAWAY: Your Honor, with -- understanding the Court's ruling, we will intend to subpoena those third parties ourselves.

20 THE COURT: That's fine.

21 MR. GANNAWAY: To the see if LoanStar ran searches.

22 THE COURT: Pardon me?

23 MR. GANNAWAY: To see if LoanStar ran searches.

24 THE COURT: I doubt seriously if LoanStar will object. It would be an interesting hearing, if they did.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0990 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 I don't see where I have an Order denying? Did y'all file one?

3 MR. WARGO: Your Honor, we can provide one on Monday.

4 THE COURT: No. All right. You don't have to. It will take me five minutes to do i t -- less than five minutes to do it.

6 MR. WARGO: Thank you, your Honor.

7 THE COURT: Okay. Let's see what's left here.

8 MR. WARGO: You waited for Los Angeles.

9 MS. GOEBELSMANN: You saved the best for last, Judge.

10 THE COURT: Is that the Continuance?

11 MS. GOEBELSMANN: No. Actually that will be last. This one is two Motions to Compel I believe. Unless you want to take up the Continuance first?

14 THE COURT: Hold on just a second. Okay. We've done that.

15 We've done the first one. We've done the second one. Motion for Continuance I am holding off on. Responsible Third Party is done.

17 Enforce the Settlement, that is done.

18 Plaintiffs' Motion to Compel Discovery Responses, Documents and Communications Higher Level TitleMax; is that the one we're talking about?

21 MS. GOEBELSMANN: That's one of the two Motions to Compel.

22 If it saves time, your Honor, the other Motion to Compel which regards those individual who we believe ran searches in violation of the TI at the same time or prior to.

25 THE COURT: I don't see that Motion. What date was it filed CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0991 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 on?

2 MS. GOEBELSMANN: The Motion to Compel the Responses to the to the people who we believe were violating the Temporary Injunction filed on November 5th I believe.

5 It regards the Sixth Request for Production on documents.

6 THE COURT: Okay. That one I haven't looked at.

7 MS. GOEBELSMANN: If Your Honor would like, it's fairly straight forward and actually regards a number of statements that opposing counsel made during the last argument.

10 THE COURT: Okay. Yeah. Let's -- 11 MS. GOEBELSMANN: Would you like me to provide you a copy for your reference?

13 THE COURT: No. I have it here. I'm looking at it right here. I thought I looked at everything but apparently not. Okay.

15 Go ahead.

16 MS. GOEBELSMANN: Well, this one would probably seem very similar to their Motion to Compel. The two Motions to Compel that are before your Honor are very simple and very straight forward. All of regards is TitleMax refused to provide us evidence that goes to our core claims as well as our concerns regarding searches that were conducted by several employees in Texas after the entry of the Temporary Injunction in this case.

23 I'm starting with that second issue since it came up in the prior argument. Back on July 17th TitleMax submitted four declarations to your Honor claiming that certain searches that were CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0992 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 run by TitleMax employees after the entry of the Temporary Injunction in June 2013 were for collection purposes.

3 When we saw those -- 4 THE COURT: Were for what?

5 MR. WARGO: Collection purposes.

6 THE COURT: Thank you.

7 MS. GOEBELSMANN: When we saw those documents or those declarations, we were concerned because they were contradicted by the PublicData production that Mr. Gannaway referenced earlier and that was 25,000 pages of documents. With respect to these four employees, 90 percent of those documents did not reference or relate to any TitleMax liens.

13 So, we were concerned that they were claiming in these declarations that they were only conducting these searches for the purpose of collections' activities with respect to only TitleMax customers.

17 It just didn't jive. Our other concern was that excuse had been used previously in this litigation. At the beginning of the case there was an individual named Ishmael Hernandez named as a Defendant. He had run an operation that he claimed to DataTrax was using DataTrax's services for collections purposes. It turned out that lot of those searches that he ran were really relating to customers and when we went to depose him on the issue he pled the Fifth.

25 So, we were very, very concerned about what's going on. And CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0993 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 we served the Sixth Request for Production of Documents on Tit1eMax in order to obtain documents that supported the allegations that were made in those declarations as well as to investigate the activities of these four employees to see if they, too, were involved in the same illegal market practices that had formed the basis of this case.

6 We also had served the Seventh Request for the Production of Documents to the Texas entities and the Second Request for Production of Documents to the TMX Finance, LLC, to get additional information regarding the higher-level employees knowledge of understanding of these marketing practices.

11 To date we have gotten very little back from TitleMax. They have not given us the information that we needed in order to adequately investigate whether or not the four people that we identified in Texas who were conducting those searches after the TIO were, in fact, violating your Orders.

16 And we have no information really with respect to those corporate employees. Potentially some information that have been produced previously for one employee with respect to deposition she said last year or the earlier this year, but for the most part we haven't gotten much of anything.

21 So, all we really want are those documents so that we can continue to prove up our case.

23 Now, there are several other issues that are also requested in these two Motions. One of which seeks identification of additional employees for that expanded time period that's not issued CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0994 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 in the Overlap List as well as bonus information regarding those individuals so we can identify who was really involved in this conduct as well as that -- again, revisit the issue that the Court -- that your Honor may recall from a prior hearing as to the production of hard drives for several individuals for whom we still haven't received sufficient documents.

7 So, we are just looking for the basic documents and going to a claims in this case.

9 THE COURT: Mr. Gannaway?

10 MR. GANNAWAY: Your Honor, with respect to -- I will call them the -- Penny Dabney was one of the folks that we submitted a declaration to your Honor in response to their allegation there have been a breach of the TI hearings and the TI Agreement. They said there was clearly a legal -- clearly breached the TI.

15 We obtained a declaration from Penny Dabney and others. Ms. Dabney said I only run these searches for locating information related to TitleMax customers. I have never looked for the Plaintiffs' customers with these-- with any of the searches on these databases. That was to cut off. An irrelevant rabbit trail.

20 Their assumption that a search came up that showed Integrity, therefore, it must be a breach. And, if you recall, that I brought to your Honor the exact customer records that relates to the very first Penny Dabney ran a show, look, your Honor when she ran this search this person has been our customer for a month. They might previously had an Integrity lien. And, therefore, it turned up CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0995 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 as an Integrity lienholder when she ran the search for skip tracing.

2 Well, we showed your Honor this is a rabbit trail. Running a search and finding ''Integrity" doesn't mean something went wrong.

4 Now, they say, Okay, Mr. Gannaway says it's a rabbit trail.

5 Make him prove it's a rabbit trail. For the 8,000 pages of documents related to the Penny Dobney search that she has already said under oath were just for TitleMax's business and never to locate Plaintiffs' customers.

9 They want us to go through there and every time an Integrity reference occurred to disprove that it could possibly have been related to a search for one of their customers, your Honor.

12 We have produced a lot of documents related to Ms. Dobney.

13 We've agreed to produce them, and we told them there's the search terms we have run. And those include things like "PublicData'' and "DataTrax.'' That will be the kind of search terms you would expect if these people were running these searches, foregoing around for information around PublicData and DataTrax.

18 We've agreed to produce that information. We've produced most, if not all, of it already. They want more. Your Honor, they want us to go through and not just produce the information in those folks' Email accounts, that says anything about PublicData or DataTrax, they want us to do more and actually comb through the PublicData records, compare them to our records and show and bring up the evidence showing that every search was related to a TitleMax customer.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0996 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 Your Honor, that's too much to ask and it's going down a rabbit trail. that is specifically defined by what folks have sworn in declarations to the Court.

4 THE COURT: Do you have any evidence to that Penny Dabney has done improper searches?

6 MS. GOEBELSMANN: Yes.

7 THE COURT: What is it?

8 MS. GOEBELSMANN: The searches that result in non-TitleMax lienholders -- 10 THE COURT: What is it -- 11 MS. GOEBELSMANN: -- over 90 percent of the documents -- 12 THE COURT: Whether is it?

13 MS. GOEBELSMANN: I can certainly present some of them to you, your Honor. As well I have the binder that opposing counsel has presented at the July 18th hearing and actually his representations regarding what that search was and what they revealed really are not consistent with his representations to the Court today.

18 First, I will provide you the information, if I may, regarding the search results that resulted from Penny Dabney's account.

21 THE COURT: It's your assertion that Penny Dabney did searches only on TitleMax TMX customers?

23 MR. GANNAWAY: Your Honor, declaration -- 24 THE COURT: Okay.

25 MS. GOEBELSMANN: So, your Honor, the documents that you CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0997 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 have before you and opposing counsel has in his hands what has been submitted to the Court previously and in a opposition to the Motion that they filed back in July, which generated the basis from trying to produce these affidavits to the Court. It's a summary of all the searches that were completed by TitleMax employees after the entry of the Temporary Injunction in this case.

7 There were the four employees. Penny Dabney was the most frequent person to use these searches. The searches that were conducted regarding ZIP Codes, regard license plate, that regarded VIN numbers, I believe that is in your hands. You should have the results that list Integrity as a lien holder.

12 To the extent that opposing counsel thinks that it will be onerous for him to provide responses to this information, I note that -- he already has it all in his possession. If he didn't from the prior filing, he certainly has it now.

16 We are very concerned because our customer -- our client kept coming up. Their customers kept coming up. And -- 18 THE COURT: Well, you just said 90 percent of what Penny Dabney researched came up with your customers, not TMX.

20 MS. GOEBELSMANN: Not quite, your Honor. 90 percent was not TitleMax. That doesn't necessarily also -- 22 THE COURT: Okay. So, I heard Mr. Gannaway saying the research is done by Ms. Dabney are on TitleMax customers. And I hear you saying your review of the Dabney research indicates that only 10 percent were TitleMax customers?

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0998 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 MS. GOEBELSMANN: Yes, your Honor.

2 THE COURT: Mr. Gannaway?

3 MR. GANNAWAY: Your Honor, there is a lag time. To give you the example that I gave your Honor before, there was a gentleman who a search was ran on August 23rd by Penny Dabney. The evidence that you heard is he is our customer. He had taken out a loan from us on July 23. Penny Dabney ran the search on August 23 on payment collection to see when that loan was due.

9 The record that came up say that it's an Integrity lien, which suggested at some point this gentleman did have an Integrity lien. I don't know how often Pub1icData or DataTrax update their databases but at some point he had an Integrity lien. But it demonstrably shows that this was a TitleMax customer.

14 What happened even though it doesn't say "TitleMax" in the line, that doesn't prove anything. If you look through the 8,000 thousand pages -- Penny Dabney documents -- a lot of them are liens from the person who sold them the car. Capital one. The Ford Motor Company. Something like that. Sometimes there are lenders. But there is a very small percentage -- extremely small that will say ''Integrity."

21 And we've shown how that is, why it occurred and we've got an affidavit from the lady saying that she never looked for the Plaintiffs' loans. And that's borne out by the fact there are so few instances of Integrity lien holders in her 8,000 pages.

25 MS. GOEBELSMANN: Going towards the public records that the CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

0999 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 prior search that were conducted related to a TitleMax lien, I have the documents that he provided at the last hearing. Unfortunately.

3 I didn't have the opportunity to copy them. But I can certainly show your Honor or opposing counsel if we can both approach the Bench and look at it but basically the search that was run was not a license plate search. It was not a VIN search. It was a Zip Code search.

7 It resulted in an entry for a car on which TitleMax actually didn't have a loan. The contract that they provided to try and say that this individual actually had a loan with TitleMax regards a 1998 Dodge Ram with a VIN number that starts 1B7HC. The result, though, that we got from PublicData that Penny Dabney did when she ran it was for a 2000 White Dodge VIN No. 1B3 something, something. They were a different vehicle.

14 That was our loan. That was our customer that they were looking up. So, to the extent that they're pointing to this 16 THE COURT: Wait. Wait. Wait. Wait. That is your customer that came up. How do I know they were looking for your customer?

19 MS. GOEBELSMANN: Because the search result that they provide here was something that was clicked on by that individual in order to view it.

22 And for us to really resolve this discrepancy we need to be able to depose Ms. Dabney to discover what was going on. And before we conduct her deposition, we need the rest of the documents that we requested our Request for Production.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1000 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 Notably, Mr. Gannaway represented that some documents were presented for her. They wer~ but they didn't include documents after a certain time period that they self-collected. They only produced documents from 2011 to 2013.

5 We are needing documents that go beyond 2013 because that's when she was running these searches that we believe violate the TIO.

7 We aren't just investigating her involvement in this illegal marketing practice, we're investigating whether or not she violated your Court's orders.

10 And we are very concerned about that. They are moving papers. They are trying -- 14 instances. 14 instances if they are a violation of the Court Order are very, very concerning to us.

13 So, all that we want to do is get the documents to which we are entitled so that we could affectively depose her. If it turns out that we deposed her and they are able to prove up this defense 1~ they are now trying to raise, then that will happen; but we can't do that without this information.

18 In addition, with respect to these Requests for Production, there are three other individuals who came up as having conducted those searches after the entry of the TIO. For those individuals they didn't even run full searches. Not only did they restrict the time frame for those searches, but they limited those search results to some of their search words to some that aren't even going to be -- produce information responsive to a number of these Requests. They only searched the words ''PublicData'', "Integrity" and "LoanStar."

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1001 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 They didn't search ''buyout" or "DataTrax" or "direct mail" or any of the other terms that they used for Penny Dobney. So, I don't know for what purpose they think that they can limit their production for those three individuals when they've already demonstrated that they can actually conduct those searches and give us all the information that is responsive.

7 They are just trying to prevent us from getting information we need so that we can continue with this Discovery that's necessary to prove up our claims and make sure that this conduct is not occurring anymore.

11 THE COURT: Mr. Gannaway?

12 MR. GANNAWAY: Your Honor, this is indicative of how they approach every point of Discovery.

14 THE COURT: Let me ask you a question.

15 MR. GANNAWAY: Yes, your Honor?

16 THE COURT: The research that you said Penny Dobney performed you said it was on TitleMax customers?

18 MR. GANNAWAY: May I approach and show your Honor?

19 THE COURT: You said that it was on TitleMax customer -- yes. you can. Just a minute. And she's saying that the search-- that she is searching by ZIP Code?

22 MR. GANNAWAY: I don't think that's true, your Honor. That is why I handed you this. If you look at this, this is the search at issue. This is the first search they attached to their Motion saying that we've done all these illegal things that I know they violated CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1002 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 the Injunction.

2 If you look at the top, that middle data in the date is when this search was run. August 23rd, 2013. If you look in the first box, you see there is the long line that has referrals and then it has DL number filled in the middle there. Do you see that ''DL state Texas," if you're following me, your Honor?

7 THE COURT: Not yet.

8 MR. GANNAWAY: It's right here.

9 THE COURT: Okay. I got it.

10 MR. GANNAWAY: So, I mean, we haven't deposed PublicData yet. We will. It's my understanding, just based on looking at this, that that means that this search was run on August 23 was by driver's license number. And you will see it popped up a number of people for some reason. Every one from Anne Waters to Steven Gordon Moran.

15 If you turn to page 2, you see that apparently Ms. Dabney clicked on Steven Gordon Moran. That was the one she was looking for.

18 And if you turn to the next page, it says "lien holder information Integrity Texas Funding." So, that's what was produced by PublicData. That led them to say illegal. Violating the Injunction.

22 What I showed your Honor was the next page, which is the loan agreement we filed with Steve Moran. We signed it, as you can see, in the upper right. The date of agreement July 24th, 2013. His loan came due on a month later. That happens to be the exact date CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1003 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 that Ms. Dobney ran a search, your Honor.

2 This evidence shows she was looking for a TitleMax customer and she found him.

4 MS. GOEBELSMANN: Your Honor, I believe he misunderstands how the results are being displayed. If you look on the page that is the first page of the handout that he provided, under the heading PublicData.com there is what probably are -- I don't know -- links or something. Then Texas is indicated. Department of Motor Vehicles and then results for one database search by ZIP Code. 10 So, really it seems like this is not a driver's license.

11 And if it were, it would be really concerning that there is this many people with that number. It seems like this was a ZIP Code search.

13 MR. GANNAWAY: There can't possibly be four people in that ZIP Code, your Honor.

15 THE COURT: I'm sorry? What?

16 MR. GANNAWAY: If this was a search of that ZIP Code, 75241, there is only-- there's Anne Waters, Karen Moran-- appears to be Mr. Moran's wife-- Heather Chance and Ida Waters. That's it. There is five people that live in that entire ZIP Code -- 20 MS. GOEBELSMANN: It's a very specific ZIP Code search it seems like.

22 THE COURT: Both of y'all need to stop interrupting the other one.

24 MR. GANNAWAY: Your Honor, the point is 25 THE COURT: This was a ZIP code search?

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1004 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 MS. GOEBELSMANN: Yes.

2 THE COURT: Well, show me what evidence -- 3 MR. GANNAWAY: Your Honor, may I be heard?

4 THE COURT: What specifically was she researching on this occasion? Social Security number?

6 MR. GANNAWAY: I believe it was for address information; but I don't know that for a fact, your Honor.

8 THE COURT: Doesn't the search show up in that top box?

9 MR. GANNAWAY: You mean what I was pointing to earlier?

10 THE COURT: Yes. Yes.

11 MR. GANNAWAY: I believe so, but we haven't deposed PublicData. So, I don't know for a fact.

13 THE COURT: Have you deposed Penny Dabney?

14 MS. GOEBELSMANN: We haven't been able to because we haven't gotten all the documents that are responsive to these Requests. We'd hate to depose her and then have to reopen the deposition once they finally do produce everything that they should be producing.

18 THE COURT: I don't know what this search was for. You say it's for ZIP Codes, and you say it's driver's license number. I can't tell what this is.

21 MS. GOEBELSMANN: Neither can we. However -- 22 THE COURT: And that doesn't give you the right to go and get thousands of pages of more documents. You're throwing this out here at me saying this is obviously a ZIP Code search, and I don't see how it is.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1005 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 I don't even know what the search is for. It just happened to turn up four or five people in this particular ZIP Code. I don't know what the search terms are. If it was ZIP Code I would expect it to turn up more than this. If it was driver's license numbers, I would be amazed that these -- this number of folks have the same driver's license number.

7 I don't know what this is a search for.

8 MR. GANNAWAY: Your Honor -- 9 THE COURT: And neither one of you can tell me. 10 MR. GANNAWAY: Your Honor, I can tell you this: 11 First of all, Ms. Lovett just pointed out to me, there's 27,066 people in that ZIP Code in Dallas. More importantly, your Honor, say she was looking by ZIP Code to identify her existing customer, the only thing we know is on the day that this customer's loan payment was coming due she ran a search and she clicked on his name specifically.

17 There is no suggestion here whether she looked him up by looking at ZIP Code that he entered on his application, whether she looked him up by driver's license number. She clicked on him and it was the date that his payment was due. And there is no suggestion that it wasn't our customer and that's why we were running the search.

23 That is why, your Honor, going down this road is just it's so far beyond what has already been defined as might be relevant to this case.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1006 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 The Overlap List, as you know, ends on June 2013 for a reason. That's what the parties agreed to. That's what your Honor has enforced in the subsequent Special Master process. And, now, they want to go with no limits whatsoever knowing that we have an Injunction over our heads. That we have sent out correspondence to folks telling them that they cannot run or they will be terminated if they do this kind of a search for anything other than that purpose.

8 It's a rabbit trail, your Honor.

9 THE COURT: Is it your assertion that because Penny Dabney ran a search and it turned up an Integrity client that you're entitled to look at everything Penny Dabney searched?

12 MS. GOEBELSMANN: We already have search results from PublicData. What we are asking for in this Request for Production are more much tailor that what you just stated.

15 For instance, we are looking for documents or communications that support or refute the statements that she made in the affidavit that she provided to the Court.

18 We're looking for evidence for those results that involved Integrity liens to show that what they are claiming that these were, in fact, TitleMax customers. From what they've provided so far, what we've seen is that there is a different car out there that has our loan on it. And they just happened to have a loan on a totally separate vehicle.

24 For all we know what she is doing is trying to search other vehicles owned by this individual to try to take that business. That CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1007 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 would be an impermissible, illegal marketing practice to take our client's in violation of this Court's Temporary Injunction.

3 THE COURT: You're fishing here.

4 MS. GOEBELSMANN: Your Honor, you have to be able -- 5 THE COURT: Y'all are fishing here. What's the specific Request?

7 MS. GOEBELSMANN: I printed three different Requests for you one by one or I have a handout that I can also asses.

9 The first Requests specifically regarding the affidavits -- 10 THE COURT: What exhibit number?

11 MS. GOEBELSMANN: -- are in the exhibits attached to the Motion regarding the Responses as 13 THE COURT: Do you know what exhibit number that is?

14 MS. GOEBELSMANN: I wrote them down. That's actually the handout.

16 THE COURT: Okay.

17 MS. GOEBELSMANN: The answers are all otherwise Exhibit D to our Motion. I'll try to make it easier because there was a number of documents that were submitted. So, this is the first set of Request for Production that we are concerned about. They submitted affidavits to your Honor stating certain things that are in contradiction to what the evidence suggests that needs to be explained in that are suspect because we have had the same excuse raised before.

25 So, we are requesting documents that support or refute the CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1008 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 statements that are being made. If these statements are accurate, then they shouldn't have any concern with producing this information.

3 THE COURT: Except they have to go through the work to get the information. That's time consuming. It's costly and it's-- and that contributes to why they don't want to have to produce this information.

7 This is a bottomless pit y'all are running here. Y'all are pursuing a bottomless pit of information. I'm agreeing with Mr. Gannaway to that extent. You are absolutely trying to discover every document that can be -- that is out there relating to certain individuals with TMX, and I have to decide whether or not that's reasonable and that results in the Discovery of admissible evidence or could reasonably -- see, you've got me tongue twisted at this time of day -- could be reasonably calculated to discovery of admissible evidence.

16 You guys are running -- you are running down every rabbit trail that there could be in this instance.

18 MR. WARGO: Your Honor -- 19 THE COURT: And I am trying to figure whether it's going to be the least bit productive. I want you to show me, tell me -- and you may have and I'm just missing i t - - what your evidence -- if your evidence is this and it turned up the Integrity people, Integrity loans, tell me why this research done by Ms. Dabney was not research done on TMX customers.

25 MS. GOEBELSMANN: It was not done on TMX customers because CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1009 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 it shows Integrity lien holders.

2 THE COURT: That doesn't mean it wasn't done on TMX customers, does it?

4 MS. GOEBELSMANN: Well, we don't know anything about any of who TitleMax's customers are. We requested the information that would answer that question in our Request for Production so that we could verify the statements that are being made.

8 We are really interested in making sure that we are able to investigate through these Discovery Requests this defense that they raised that this is for collections purposes.

11 We also are entitled to investigate the basis for these affidavits that have been submitted. So, that is why we served those Requests requesting that information.

14 MR. WARGO: Your Honor, may I make a suggestion? What about if we go down one of these with Penny Dabney? We will stop there if Mr. Gannaway's correct. If he's not, Mr. Gannaway might agree with us that we can continue.

18 THE COURT: What do you mean you go down one of these?

19 MR. WARGO: We take the deposition of Penny Dobney. We get the documents that we've requested regarding Penny Dobney to see if Mr. Gannaway's correct.

22 If he's correct, it is over. We won't try to seek information, documentation or further depositions from these people.

24 If the Penny Dabney deposition and the documents that we have asked for concerning Penny Dobney do supp6rt what we believe is the case, CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1010 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 that this TIO of the Court has been violated, then we would like to go ahead. And I am sure Mr. Gannaway way would agree that we would be entitled to that information from the others.

4 We have asked for three or four and we are happy to go with one.

6 THE COURT: I think it's four.

7 MR. WARGO: Four, your Honor. Penny Dabney looks like she's the most egregious violater. So, if we can get that documentation, sit her down for deposition, and, if this is incorrect, then we've had one deposition and we've have had to incur the time and trouble of getting documents together for one individual.

12 MR. GANNAWAY: Your Honor, that doesn't change the fact that it's a bottomless pit. It takes time to do these kind of searches to determine if these are, in fact, our employees.

15 They have asked you to in their Request for Production to have us believe every TitleMax customer, every person in those searches is a TitleMax customer. Remember, we're talking about 8,000 pages in Ms. Dabney's PublicData search results.

19 They have an affidavit from her. They can put her on the stand for deposition, your Honor.

21 THE COURT: Hold on a second. Have you produced 8,000 pages of Discovery on Ms. Dabney?

23 MR. GANNAWAY: PublicData.

24 THE COURT: PublicData produced 8,000 pages?

25 MS. GOEBELSMANN: It's all searchable. All they have to do CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1011 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 is Control F and Integrity and they will get all the results.

2 THE COURT: Can't you do that, too.

3 MS. GOEBELSMANN: We can do it as well.

4 MR. GANNAWAY: We had Ms. Dabney -- 5 THE COURT: Wait a minute. You've got 8,000 pages from PublicData?

7 MS. GOEBELSMANN: Yes.

8 THE COURT: And you can yourself do the searches to determine if it was Integrity or not?

10 MS. GOEBELSMANN: Yes.

11 THE COURT: Why don't you?

12 MS. GOEBELSMANN: We have and we've presented some of those to your Honor that we believe are TI -- 14 THE COURT: Okay.

15 MR. GANNAWAY: Your Honor, moreover, they can search their own records to see when those Integrity -- when those Integrity loans were bought out. They are the only ones that have that information and, they can then cross-examine Ms. Dobney. She is -- we offered her up for deposition already. They are the ones with the keys to the information, your Honor, as to whether there was an Integrity -- an existing Integrity loan on the date that those searches were run.

22 MS. GOEBELSMANN: Yeah. But we're asking for the proof that supports these claims in the affidavits that these were existing TitleMax employees because -- 25 THE COURT: How does she know -- for instance, look on this CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1012 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 package that they just provided today. The first PublicData page the search box says August 23rd, 2013.

3 MR. GANNAWAY: Yes, your Honor.

4 THE COURT: You with me?

5 MR. GANNAWAY: I'm with you.

6 THE COURT: And the PublicData notes Dallas, Texas person.

7 MR. GANNAWAY: Yes, your Honor.

8 THE COURT: Okay. On the next page it shows lien holder Integrity Texas Funding.

10 How does she know from this information that this search was seeking out a TMX employee -- a TMX customer?

12 MR. GANNAWAY: Couple of answers, your Honor.

13 First of all, this search, according to what PublicData said in their Production, and it's certainly what Ms. Dobney provided in an affidavit that said she never ran a search for Integrity for other Plaintiffs.

17 The second -- 18 THE COURT: Okay. Let me respond to that. This is an indicat~on that that might not be correct, isn't it?

20 MR. GANNAWAY: No, your Honor.

21 THE COURT: If it comes up with ''Integrity''?

22 MR. GANNAWAY: As I -- this is exactly -- this is actually the situation where for the gentleman whose records I handed you.

24 This is his search. And that shows that coming up "Integrity'' has nothing to do with whether he is a current TitleMax customer or not.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1013 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 This is Mr. Moran. We might have to seal this record because I have said his name a few times. But that is exactly where this is a rabbit trail, your Honor. We've shouldn't have to go -- 4 THE COURT: I don't see exactly why it's a rabbit trail.

5 Maybe I'm not smart enough to figure it out, but I don't see it.

6 When a search is conducted and the information that is derived from the search says ''Integrity Texas Funding," how do I know that what this person is looking for is TMX customers?

9 MR. GANNAWAY: She's sworn to in affidavit. She is ready to be deposed on it, your Honor.

11 The other issue, if they want to look and see, well, when Ms. Dabney did this search was this one of your customers, they can look at August 23rd, 2013. Go into LoanStar's records. Was Mr. Moran an Integrity customer as of August 23rd, 2013. They can go do that.

16 We all know, your Honor, that there is no suggestion -- if the indication here is right that the drivers license number and that we can -- I think we need to depose PublicData to get to the bottom of exactly what they mean search by driver's license number.

20 There is no way that Ms. Dabney intuitively or guessed what someone driver's license might be so that she can figure out if it was an Integrity person.

23 THE COURT: Is it your contention that because "Integrity" came up they were obviously searching for Integrity?

25 MS. GOEBELSMANN: And that they have conducted searches CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1014 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 that, yes, result in our -- 2 THE COURT: That's not what I asked you. I asked you: 3 Is it your contention that because this came up that they were searching for Integrity?

5 MS. GOEBELSMANN: I don't know what they were searching for.

6 Integrity specifically or other competitors as well.

7 THE COURT: Doesn't that matter? Doesn't .that matter -- 8 MS. GOEBELSMANN: It does.

9 THE COURT: -- what they were searching for?

10 MS. GOEBELSMANN: It does matter if she was searching for marketing purposes and she found one of our customers, then we need to have the documents that they claim exists that would refute what we're seeing in this evidence.

14 THE COURT: Okay. Before we're going to go down that trail, we're going to find out what the searches terms were.

16 If the search terms were by driver's license number and that driver's license number leads you to a TMX customer, then this is not an improper search, is it?

19 MS. GOEBELSMANN: I don't know.

20 THE COURT: What's your gut feeling?

21 MS. GOEBELSMANN: If they were driver's license? I don't know what information they may have obtained that may be using to search for our customers. I'm not willing to make a statement to that point because it -- that very well may be driven out of context later on.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1015 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 THE COURT: How would they have obtained your customer's driver's license number?

3 MS. GOEBELSMANN: Again, this is possible litigation.

4 THE COURT: Okay.

5 MS. GOEBELSMANN: There are many things to try to locate our customers.

7 THE COURT: Before we go down this trail, either find out what the search terms were because I think that's important. If the search terms are benign search terms or are they actually searching for a TMX customer, then I don't necessarily think you're entitled to get all of this information.

12 MS. GOEBELSMANN: Essentially the information that we are asking for and regarding our suggestion to help make this reach a resolution regarding this issue, we have a limited number of items that we believe are TIO violation.

16 We can always do as Mr. Wargo suggested and just have them provide us information regarding to searches and then we can go ahead and depose Ms. Dobney and try to investigate the 19 THE COURT: Limited to these searches right here.

20 MS. GOEBELSMANN: Limited to the ones that we believe are in violation of the TIO. And not just with respect to her affidavit -- it is not with respect to outstanding Requests that we have touched on this afternoon.

24 THE COURT: So, there is 14 searches here?

25 MS. GOEBELSMANN: Right. There are 14 searches CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1016 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 THE COURT: You limit it to these 14 -- information on these 14 searches.

3 MS. GOEBELSMANN: Yes. In response to those Requests 12, 25, 37, 11, 24, 36 and 49.

5 THE COURT: Let's test this, Mr. Gannaway. And limit your Response to these particular Requests -- to the 14 items that are on this package of information that was provided to you.

8 MR. GANNAWAY: A couple of points, your Honor: 9 May we go through the exercise of deposing PublicData first to see if there was any improper search terms?

11 As your Honor pointed out, this exercise is looking at things that are likely, according tq the basis of the documents, to be searches for specific people by people who knew something like the driver's license number. I would suggest that a -- the way to approach this is depose PublicData and find out the information to that.

17 THE COURT: It would seem to me that it would be easier to just provide the information on these 14 searches and conduct the deposition of Ms. Dobney based on that, and I would really prefer you do it that way.

21 MR. GANNAWAY: Your Honor, I would point out that not all of those searches are run by Penny Dobney. If you look in the second column -- 24 THE COURT: Then limit it to the searches that are performed by Penny Dobney and I think that's CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1017 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 MS. GOEBELSMANN: Says ''P. Dabney 01."

2 MR. GANNAWAY: Your Honor, let me point something else out -- 4 THE COURT: Mr. Gannaway, come on. It's 5:00 o'clock it's after 5:00 o'clock, and we are not done yet. You want to be here till 6:00 or 6:30?

7 I've made my ruling. I want you to produce the information relating to these ten searches by P. Dabney 01. Take her deposition.

9 And if the deposition tends to support your claims, then we will take another look at going at more extensive Discovery on things relating to these Requests.

12 MS. GOEBELSMANN: Your Honor, just a minor point of clarification: 14 Since they had previously restricted their Production to the time frame of Overlap List in these searches that regard after the TIO was entered, can we ensure that any Production includes the time period after the entry of the TIO?

18 THE COURT: Yes.

19 MR. GANNAWAY: With respect to those search?

20 THE COURT: With respect to just these ten searches.

21 MR. GANNAWAY: Understood, your Honor.

22 THE COURT: Is that clear?

23 MR. GANNAWAY: It is, your Honor. Understood.

24 MS. GOEBELSMANN: So, to keep moving forward, the other Requests that were at issue here that regard the marketing to CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1018 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 customers by these employees as well as recording it and copying of license plate numbers as well as searches DMV database, those were also restricted by time unilateral TitleMax to 2011 to 2013.

4 And we just want to ensure that, when they make their Production, that they include the search terms that were used also use for Penny Dabney for these other individuals. These are separate Requests and as well as increase the time frame for those particular requests.

9 MR. GANNAWAY: As I understand from what your Honor just pulled, I will run these searches Penny Dabney, which includes searches in 2014. And that is going to be the basis for determining whether it's proper to extend Discovery of the time period relating to these searches.

14 I think that makes sense because there is still not any evidence before this Court that there were actually searches done to try to locate Plaintiffs' customers.

17 In fact, the evidence is just the opposite. I know they think these people all perjured themselves, but they gave declarations to this Court that said they didn't run searches to locate the Plaintiffs' customers.

21 MS. GOEBELSMANN: And part of the reason we don't have the full response to any of the individual beyond Penny Dabney.

23 THE COURT: What specific Request?

24 MS. GOEBELSMANN: I have them right here.

25 THE COURT: Okay. I have them right her in front of me. CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1019 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 MS. GOEBELSMANN: Okay. So, it's going to be-- it will seem like a lot, your Honor.

3 So, it's Request 14, 16 -- 4 THE COURT: One at a time.

5 MS. GOEBELSMANN: Some of these are similar to one another.

6 THE COURT: Just one at a time.

7 MS. GOEBELSMANN: So -- 8 THE COURT: Any and all documents or communications evidencing any contracts; is that what you're talking about?

10 MS. GOEBELSMANN: Yes. That refers really to these individuals conducting marketing to customers of competitors, recording or copying license plate numbers.

13 THE COURT: Hold on a minute. Maybe I'm looking at the wrong Request No. 14.

15 MS. GOEBELSMANN: I'm sorry. I may be combining them all.

16 THE COURT: Don't. One at a time so that I can understand what you're dealing with.

18 MS. GOEBELSMANN: Sure.

19 THE COURT: Is No. 14 any and all documents or communications evidencing any contracts between Schaefer and DataTrax, PublicData and any other DMV database dated from any time during his employment with TitleMax?

23 MS. GOEBELSMANN: I'm not sure which Request you're on, your Honor.

25 THE COURT: Well, it looks I was -- I clicked on Exhibit D.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1020 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 MS. GOEBELSMANN: The first one that I was looking at that relates that -- that relates to James Schaeffer is Request No. 16 and that is any and all 4 THE COUBT: Which exhibit are you referring to?

5 MS. GOEBELSMANN: That should also be in Exhibit D.

6 THE COURT: Well, I'm reading No. 14, and it says ''James Schaefer."

8 MS. GOEBELSMANN: Okay. I'm not sure that we're moving with respect to No. 14. The one that I marked that we're moving on that we are concerned about is No. 16.

11 THE COURT: 16: Any and all documents and communications including but not limited to those located in marketing binders for each TitleMax store in which James Schaefer has worked while employed by TitleMax that refer or relates to James Schaefer marketing to customers of competitors.

16 MR. GANNAWAY: Your Honor, that's part of their business.

17 They try to market to customers' competitors. That is substantially overbroad.

19 MS. GOEBELSMANN: We believe that it's overbroad and we are happy that it can be restricted to the circumstances that are at issue by using the searches terms for Penny Dabney for any of those employees. We would like them to employ the same search terms they used for her for these individuals to see if there are any responsive documents.

25 MR. GANNAWAY: To let your Honor know what the basis for CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1021 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 them seeking all this, if you look at this list, James Schaefer, look at the subject of these Requests one search that turned up "Integrity" -- 4 THE COURT: Hold on. Before we start doing extensive searching to determine whether or not everybody has committed a violation of federal law or any other improper act, let's see what Penny Dabney's Discovery turns up.

8 And then, if it turns up anything, then we will expand this to the others.

10 MS. GOEBELSMANN: Our only concern, your Honor, is that if Penny Dobney -- we understand that 12 MR. WARGO: Christina -- 13 MS. GOEBELSMANN: Okay.

14 THE COURT: Thank you.

15 MS. GOEBELSMANN: Moving forward with this same Motion to Compel, the other Requests that we had it issue are 56, 57 and 58. I have a handout for your Honor.

18 THE COURT: It'll take me a while to get there, but I'm going to tennis finger here but I'll get there.

20 All documents sufficient to identify each district manager for each district identified in Response to 54 from August 2011 to June 2013.

23 Hold on a minute. Identity of each district manager -- how many districts were identified in 54?

25 MS. GOEBELSMANN: Your Honor, we haven't received any CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1022 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 response to that.

2 MR. GANNAWAY: 54 asks for every district in Texas. So, in other words, they want a list of every district manager throughout the State of Texas for almost a two-year time period with no indication why that would be relevant.

6 MS. GOEBELSMANN: It is relevant because there are -- there is a pending Order from this Court that certain production by your client is going to be relating to the kind of that occurrence in certain districts and regions.

10 So, we need to know where -- what those districts and regions were. We would also like to know what the district or region is so that we will be able to do appropriate Discovery to determine which in this illegal market practice.

14 THE COURT: But you haven't limited it to any district or region.

16 MS. GOEBELSMANN: Oh, because we don't know what those districts and regions are.

18 THE COURT: I thought we were -- 19 MS. GOEBELSMANN: They haven't provided it to us.

20 THE COURT: Well, 54 is: 21 All documents to identify the geographic state, name and number of each of TitleMax's districts.

23 So, you're asking for district managers in every district in Texas?

25 MS. GOEBELSMANN: We've requested similar information CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1023 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 previously in this litigation. It only went over the time period from 2012 to 2013.

3 Since the expansion of the Over Lap List, we are missing employment history or the number of employees or who they were for the rest of the state with respect to that time period.

6 We're trying to since we've been burdened with trying to do Third-Party Discovery in order to identify who was employed -- won't talk. Won't identify the people who were involved. They won't give us the contract. They won't tell us what databases they were using. Everyone keeps clamming up.

11 We need to know who else was out there so that we can conduct Discovery that was necessary, and it's been effective in this case.

14 We have had the opportunity to depose a number of former employees who have, in fact, told us that they were engaged in this type of conduct. With Randy Rainey over in Dallas. Mike Martinez over in Dallas. These people were found based upon similar types of Discovery what they are.

19 When they don't give us this information, they are preventing us from actually being able to prove up the rest of our case and we know that it's affective because it has worked so far.

22 MR. GANNAWAY: Your Honor, there is nothing linking this Request to any allegation by the Plaintiff. They literally want a list of every district manager.

25 And then if you parlay that to what she is about to tell CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1024 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 yo~, they want to know what every single one of our employees -- 950 employees in Texas what bonuses they were paid.

3 Under the theory that, if they got a bonus, they must have done something through good performance that resulted from an illegal search. That's literally the theory that they have here, your Honor.

6 There is not any relevance to that. And there is not any reason that they need to know every district manager regardless of where he's located -- he or she is located -- and regardless of whether there is an ounce of evidence from anyone or any document that they implicated with any of the Plaintiffs' allegations.

11 MR. WARGO: Your Honor, the way that has worked as we have found in this case is that people from district to district talk to one another.

14 Mr. Gannaway will admit that. People hand information from one office to another. Hey, do a search like this. Do an illegal search like this and it spreads from office to office.

17 Those are the facts of this case that we have found in Discovery. But what we're trying to find out here is the name of people --many of these people are going to be former employees. The names of these people to find out, hey, did this get handed to your district? Did you hear about this? Who did you report to? Did your superior know about this?

23 That is -- as Mr. Johnson had said previously, that's the spade work. We're going to go ahead and call these people -- many of them are former employees -- and find out did you hear about this.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1025 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 Did you know about this. Did higher ups know about this. That's our hard work. But without identifying who those people were, we're stuck.

4 And the evidence in this case -- Mr. Gannaway will not be able to deny this -- is from office to office they traded buy-out letters. Word-of-mouth was like, oh, DataTrax, did you use that.

7 PublicData.com. That's how it spread from office to office. And that's all we're trying to find out.

9 The burden on them is negligent. It's infinitesimal. We just want the names of these people. We will do the work in contacting them and find out what they knew.

12 THE COURT: How many districts are there?

13 MR. GANNAWAY: My client just left.

14 THE COURT: I just noticed that, yeah. You have an idea -- ballpark?

16 MR. GANNAWAY: I think -- I want to say for instance, in Austin there's five to ten districts. Something in that order to give you a sense. But I don't know the answer, your Honor.

19 MR. WARGO: And, your Honor, respectfully, we're talking about people who could lead to the Discovery of admissible information.

22 Thank you, your Honor.

23 MR. GANNAWAY: Your Honor, I think what he -- 24 THE COURT: Just wait. I can't listen and read.

25 MR. GANNAWAY: Understood, your Honor. I am sorry.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1026 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 THE COURT: So, you are not asking me to compel them to respond to No. 54, but you are asking me to get them to respond to 56? It seems to like 54 would be important to responding to 56.

4 MS. GOEBELSMANN: Yes. And we can certainly have them respond to 54 as well.

6 THE COURT: Okay. I'm going to ask you to respond to 54 and 56.

8 MR. WARGO: Thank you, your Honor.

9 THE COURT: If their legwork to date has turned up otherwise wouldn't have turned up except for you identifying names of employees for them to go interview, I think -- I think this is discoverable. 12 So, 54 and 56 the objections are overruled.

13 MR. WARGO: Thank you, your Honor.

14 MS. GOEBELSMANN: Does the same apply to 57?

15 THE COURT: You didn't ask me to apply 57?

16 MS. GOEBELSMANN: Your Honor, 57 is very similar corporate response to 55 and that is just in regards regional managers. Our understanding is that there is less regional managers than district managers.

20 THE COURT: Okay. Then I agree. 55 and 57 as well.

21 MR. GANNAWAY: Okay.

22 THE COURT: What else?

23 MS. GOEBELSMANN: The last Request in this particular Motion to Compel is Request for Production 58. Provide bonus information.

25 We are interested in obtaining this information because it will allow CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1027 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 us to demonstrate to the jury when we essentially get there that there was an incentive for these people to engage in a particular type of conduct.

4 That people were either being -- were awarded for their efforts that they engaged. Or if they weren't being rewarded for their efforts, that maybe they were unable to meet performance goals they have been so desperate to do so punish to this particular methodology for located customers.

9 THE COURT: At this time I am going the deny 58. I tink that is overruled. I am not sure that that is calculated to lead to the discovery of admissible evidence.

12 We may address that issue at some other time in the future, but at this point in time I'm denying it.

14 MS. GOEBELSMANN: I think that brings us to the other Motion to Compel, and this is a Motion to Compel where we have not gotten documents on -- 17 THE COURT: Give me the date it was filed.

18 MS. GOEBELSMANN: It was filed I believe on November 12.

19 THE COURT: Specific items?

20 MS. GOEBELSMANN: The specific items Request for Production 9 through 17.

22 THE COURT: Are those items contained in your Motion, or do I need to go look at actual Motion?

24 MS. GOEBELSMANN: I believe that -- 25 THE COURT: The actual Request for Production.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1028 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 MS. GOEBELSMANN: It's probably easier for you to look at the actual Request for Production due to the length of those particular Requests. I have a hand out for you.

4 THE COURT: Exhibit what?

5 MS. GOEBELSMANN: Let's see.

6 THE COURT: Exhibit B?

7 MS. GOEBELSMANN: It is Exhibit B. I had to do a double take. The letter to our other Motion.

9 THE COURT: Okay. What number?

10 MS. GOEBELSMANN: These are Requests 9 through 18. We can start at the top with No. 9.

12 THE COURT: So, you want text messages from employees to DataTrax, PublicData or DMV?

14 MS. GOEBELSMANN: We're looking for all documents and communications that involve correspondence between four particular individuals who were employed by TitleMax that regard a number of things including text messages. And this particular Request is, as you stated, the use of DataTrax, PublicData, DMV databases.

19 MR. GANNAWAY: As you see, your Honor, we did agree to produce much of what they were requesting 21 MS. GOEBELSMANN: The problem is though 22 THE COURT: Don't interrupt. Come on.

23 MR. GANNAWAY: I am sorry.

24 THE COURT: It's going to go much quicker if you don't.

25 MR. GANNAWAY: So, we -- CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1029 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 THE COURT: Wait a minute. Hold on a minute. Let me read.

2 Where is it?

3 Necessarily what you're agreeing to produce if there were any communications from the four employees that are at issue? Two are from people associated with DataTrax, PublicData, DMV databases.

6 MR. GANNAWAY: We tried to locate that by looking for the search DataTrax, PublicData, DMV in the database-- I'm sorry-- in those folk's Email accounts and nothing came up.

9 Nothing came up, your Honor.

10 MS. GOEBELSMANN: Didn't make it clear nothing came up.

11 They said we object to the extent that these things have already been produced, that there are no documents -- 13 THE COURT: Okay. You need to amend your response.

14 MR. GANNAWAY: Say "none.'' I will do it. And I told Mr. Johnson that there were none, but yes.

16 THE COURT: You still have to do it.

17 MR. GANNAWAY: Okay.

18 THE COURT: Okay.

19 MR. GANNAWAY: Well, I don't think it's quite accurate that there were none and there were just a couple of items on the Privilege Log that was provided.

22 THE COURT: File a Supplemental Response to this Request.

23 What's next?

24 MS. GOEBELSMANN: The remaining Requests are ones that are very familiar to your Honor, I'm sure, in regard to marketing to CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1030 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 LoanStar's customers and their use of DMV databases. Really looking for communications involving 3 THE COURT: Tell me the numbers.

4 MS. GOEBELSMANN: So, you can go to-- you can go to No. 11.

5 THE COURT: Okay. Give me the numbers. Just go down the list.

7 MS. GOEBELSMANN: 11.

8 THE COURT: Yes.

9 MS. GOEBELSMANN: 12, 13, 14, 15, 16 and 17.

10 THE COURT: Any and all documents including text messages by any corporate employee that refer or relate to marketing to customers of LoanStar or Integrity.

13 MR. GANNAWAY: As you see, I object to the text messages but did say we will produce responsive non-further documents that refer or related to marketing customer of Integrity, which I think meets the Request.

17 And I will -- I can amend to say -- 18 THE COURT: But the question is what they -- what -- here is my issue with Discovery in general. Y'all may have heard it or not: 20 Saying we will produce doesn't help me because I don't know if you have anything or not. We will supplement doesn't help me because I don't know if you have anything or not.

23 So, you have to tell me whether you have something to produce and you also have to tell them whether you have or don't have something to produce.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1031 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 MR. GANNAWAY: Understood and I can amend to do that. I can tell them the search terms we used. With respect to all of their Requests that she is going through the answer has been ''none'' based on the word search for these four folks.

5 MS. GOEBELSMANN: What were the key words searched that you used because? we haven't received that information of all these individuals.

8 MR. GANNAWAY: I will amend and provide to you and explain it's none.

10 MS. GOEBELSMANN: To the extent that there's any difference, we would request that you use the same search terms that you used and were listed in the Penny Dabney production: 13 Buy out, DataTrax, direct mails, DMV and Integrity, LoanStar, PublicData, license plate, marketing plans, goals.

15 They are all listed in the 16 MR. GANNAWAY: The terms you've just said go far beyond some of the Requests for Production. We've had search terms that are likely uncover things related to these Requests for Production, but I will explain to you what those terms have been.

20 MS. GOEBELSMANN: Yotir Honor, we really believe they should be using the same search terms that were used for previously prepared similar Requests because it's resulted in the production of responsive information.

24 And since they've complied before, we know that you are capable of doing it.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1032 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 MR. GANNAWAY: Your Honor, that doesn't mean that -- for instance, she used the word "license plate" -- to just give an example 4 THE COURT: She is going to send you their universe of requested search terms. You go through those search terms and look for terms that specifically relate to marketing to customers of LoanStar.

8 That is on No. 11. No. 12 -- these are all marketing?

9 MR. GANNAWAY: I will explain to your Honor what I have done: 11 In general there is a lot of search terms we used but the core ones that we have used are: 13 LoanStar, Integrity, DataTrax and PublicData.

14 The ones that are likely to relate to these databases.

15 We also searched the term "DMV'' even though that turns up a lot of documents that are unlikely to be responsive. But the core ones -- PublicData, Integrity, DataTrax, LoanStar -- we have definitely done that with respect to all of the four of those folks and their Emails.

20 MS. GOEBELSMANN: Marketing within a certain number of terms would be a search term that would be very important in responsive to a number of these Requests.

23 THE COURT: Say that that again.

24 MS. GOEBELSMANN: Marketing where you can do a certain number of terms with competitors that would be responsive, but we CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1033 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 don't want to limit it at this point what we believe the list is. I can certainly give some examples as to what should be searched.

3 MR. GANNAWAY: But -- and therein lies the problem, your Honor. When you say "marketing'' -- anything that has "marketing" and "competitors," that could be a million documents that have nothing to do with this lawsuit that we would have to review that if we wanted to search something like that.

8 THE COURT: Have you done searches using search terms -- well, the answer's'going to be "no"?

10 You want to use 4 or 5 search terms, and you want to use 12 or 13 search terms. And my question what I'm curious whether the 4 or 5 would turn up what you have obtained versus using the 12 or 13.

13 MS. GOEBELSMANN: Not necessarily.

14 THE COURT: And we don't know the answer to that unless you do it.

16 Send your list of search terms. Consider expanding your list beyond the 4 or 5 and see what kind of-- maybe you can get some kind of an agreement.

19 This electronic Discovery is exploding in this country and I'm not trying to make an editorial comment or something but it's going nuts as everybody knows.

22 Send him your terms. Expand it beyond the 4 that you're talking about. May not include every one of them but make a good-faith effort to.

25 MR. GANNAWAY: And to be fair, your Honor, with every CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1034 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 production we have said these are the search terms we've used. So, I don't want to hide behind anything.

3 THE COURT: Okay. That covers -- and that would cover most of these, wouldn't it?

5 MS. GOEBELSMANN: Yes. Our only concern is that we might end up before your Honor, again 7 THE COURT: You will end up before me again.

8 MR. WARGO: May I make this more of a concrete can we split the difference and let us pick the terms? We have a certain amount. They have a certain amount.

11 I don't even know what their numbers are. I think they're at 10. We are at 4. We will split the difference. We will pick the search terms.

14 MR. GANNAWAY: And, your Honor, if the term is something like ''marketing to competitor,'' I don't think it's fair to us to review 10- or 20,000 documents that might pop up as a result of something that general.

18 MS. GOEBELSMANN: It would be the search terms that were similarly used for Penny Dabney. That certainly didn't result in tens upon millions of documents. You have already indicated that other search terms and didn't have as much.

22 So, I don't think -- really think, based upon your representations, that we will be in that situation.

24 THE COURT: I will tell you-- I will tell you what let's do: CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1035 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 Use their search terms. See how much documents come up.

2 Talk between each other and see if you can work it out. You're going to be back here.

4 Mr. Wargo, as much as you think you're not, you're going to be back here.

6 MR. WARGO: I am sorry. I am trying to avoid that. What if we limit it to the Penny Dabney search terms? Then split -- 8 THE COURT: Do the search. Use search their search terms and see what comes up.

10 MR. GANNAWAY: I will.

11 THE COURT: If it's a manageable number. If it's a not a manageable number then 13 MR. GANNAWAY: We will work with them.

14 THE COURT: talk to each other and try to work on it.

15 MR. WARGO: Thank you, your Honor.

16 THE COURT: Does that take care of those?

17 MS. GOEBELSMANN: That takes care of those Requests and I believe that the -- 19 THE COURT: Hard drives.

20 MS. GOEBELSMANN: I believe that Mr. Wargo can speak as to a particular aspect of these Requests regarding text messages.

22 MR. WARGO: Well, did you make that representation that there were no text messages responsive to this?

24 MR. GANNAWAY: No. Our position was that we do not own the mobile devices that those employees use. They are their own private CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1036 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 device, and they are not in our custody and control.

2 We did not ask them for their text messages. There is one exception: 4 At the deposition of Linda McDonald-- who's one of those four people -- she specifically referenced a text message that would have been relevant and responsive. They didn't ask her at that deposition but we did ask her during a break do you have that text message that you referenced anymore and she said ''no." 9 She is no longer with the company. But that's the only that's the only evidence that there was a relevant text message anywhere any time.

12 MR. WARGO: Well, your Honor, we understand that again, it being a small community, we understand that there is a significant amount of text messaging that's going on within that company.

15 And if they're making a representation that they're not their phones, we will then send out subpoenas asking for Verizon or et cetera for that information.

18 Thank you. We will do the spade work. Thank you, your Honor.

20 THE COURT: Is that it?

21 MS. GOEBELSMANN: Almost.

22 THE COURT: Hard drives?

23 MS. GOEBELSMANN: Yes. The hard drives are the last issue.

24 These are Requests for Production 5, 6 and 7.

25 MR. GANNAWAY: I can short circuit this, your Honor. I can CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1037 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 tell what we've done since the meet-and-confer session we had about this.

3 At the meet-and-confer session -- you remember the issue of the spreadsheet that I'm not sure-- 5 THE COURT: Not at 5:35 on a Friday afternoon I don't.

6 MR. GANNAWAY: I can show you what it is, but that's -- the one piece of testimony that we have that someone saved a document that might have had PublicData or DataTrax stuff on it on the computer Todd Hale who testified to that.

10 THE COURT: Okay.

11 MR. GANNAWAY: We searched the hard drive data at the store that he was at for the terms that would likely turn up PublicData and DataTrax stuff. PublicData, DataTrax and Integrity. We didn't find anything in that hard drive data.

15 They filed -- after his deposition, they had a specific Request for Production directed to me that said find me that spreadsheet. I went and looked. We had already done the search term issues, but we looked at every single Excel spreadsheet in that hard drive data and I found one that might be it.

20 THE COURT: I do recall that.

21 MR. GANNAWAY: And Hale wouldn't tell me. He told me to pound sand when I called him last.

23 THE COURT: Right.

24 MR. GANNAWAY: So, there is no more to search on that hard drive. I have looked for search terms and I have found a document CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1038 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 that I told them if you will drop the issue of Mr. Hale's store hard drive data I will give it to you.

3 I'm not making any representation that it's it, but I will give it to you. They've declined.

5 Now, the other two hard drives they're seeking are from stores that at which Lucia Grajeda 7 THE COURT: Right.

8 MR. GANNAWAY: -- and Mr. DeLeon worked. And those two folks pled the 5th.

10 Now, there's been no testimony that they saved stuff on those hard drives but -- and at the meet-and-confer that we had on this I told them I have not searched those hard drives because there has been no testimony that there's been anything on them unlike the Mr. Hale hard drive.

15 And I said if you have specific search terms that you want me to look for, specific documents that you think might be on those hard drives, tell me but I haven't done any searches.

18 Yes, they filed that Motion to Compel. I went ahead and did searches myself to deal with this issue before we came before your Honor. And I searched PublicData, DataTrax an Integrity. We found two documents that were responsive. One of which was already produced in this case as a paper document. And one of which demonstrably on its face I am thinking even they will contend, though, that we were searching PublicData to figure out information about an existing TitleMax customer. That's it.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1039 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 I've run the searches that would be likely to recover anything that is relevant and that is responsive to their Discovery Requests on those hard drives. And, therefore, they don't get anywhere close to the standard that needs to be met by In Re Weekly Homes to get our hard drives.

6 We've done the search. We've produced the information found. It's done.

8 MS. GOEBELSMANN: Several corrections to what Mr. Gannaway said.

10 First off with regard to the production that he claims to have made from the Felix DeLeon's data from his hard drive, we got one page that was a result -- it's page 21 of 41 -- from a PublicData or DataTrax search that listed an Integrity lien holder.

14 We don't know where the rest of document is and it had not previously produced in Discovery even though it was responsive to one of the first Requests for Production ever served in this case and should have been provided in response to that Request.

18 Second, we still don't have the spreadsheet that I believe is responsive to the Request for Production regarding Mr. Hale.

20 Although he tried to, you know, make us basically buy a pig in a poke, say I am not going to tell you what this but drop your entire argument based upon this document, we weren't willing to do that because we don't know what it is he has.

24 THE COURT: No. You shouldn't have done that.

25 Mr. Gannaway, that was interesting request on your part. Do CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1040 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 you have is there a spreadsheet?

2 MR. GANNAWAY: Yeah. I can show it to.

3 THE COURT: Why don't you give it to them? Have you given it to the Plaintiffs?

5 MR. GANNAWAY: No. 6 THE COURT: Why not?

7 MR. GANNAWAY: Because they said they were still reserving the right to pursue the hard drive issue. There is no more hard drive issue to pursue. I would like to give it to them and put this issue to bed.

11 THE COURT: Why can't you give it to them without limitations? It may put this thing to bed.

13 MR. GANNAWAY: At your Honor's direction, I will do that.

14 THE COURT: What's on that that causes you not to want to produce it?

16 MR. GANNAWAY: Nothing. It's a list of names and addresses.

17 The point is I don't know that this --what they have asked for in this Discovery Request. I am making a guess it could be. It's a list of names and addresses. I can show it to your Honor 20 THE COURT: It won't have any meaning to me. 21 MR. GANNAWAY: Well, I just -- I just want to let your Honor know if this clearly was Mr. Hale's document I would have produced it, but I don't have any reason to believe that. I will give it to opposing counsel now.

25 MR. WARGO: Well, I can't let that one go, your Honor, CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1041 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 because if there is any reasonable belief by an officer of this Court that this is a relevant document, the gamesmanship involved in waving the document in front of your Honor saying this may be it but I'm not going to give to unless you reduce your rights, your Honor, that's inappropriate.

6 THE COURT: You've got it.

7 MR. WARGO: Thank you.

8 THE COURT: Right?

9 MR. WARGO: Now we do, your Honor.

10 THE COURT: You have it now.

11 MR. WARGO: And we had to move to Compel to get to this point.

13 THE COURT: You shouldn't have had to do that. You should have -- 15 MR. WARGO: We sought our fees, your Honor.

16 THE COURT: You should have gone ahead and given it to them.

17 Have you provided them with the documentation of the searches that you have done on the other -- on all three of these computers?

19 MR. GANNAWAY: As part of our response to their Motion and then I produced the documents.

21 THE COURT: Have you provided the documentation which indicates what the searches were that you performed?

23 MR. GANNAWAY: I say in the Motion that we looked for DataTrax, Integrity and LoanStar.

25 THE COURT: And is there demonstration of those searches?

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1042 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 Does -- I've never performed a hard drive search. But when you perform a search of a hard drive using specific terms, does it produce a document which shows what the nature of the hard drive search was including what the search terms were and whether the search was productive?

6 MR. GANNAWAY: No. I will tell you it's sort of like we use a tool called ''Relativity." We load all our contents of the hard drive in Relativity. It's sort of like Google. I will search the word "DataTrax." And any document on that hard drive that contains the word ''DataTrax'' will come up in a list of search results. And I will have to click all of them to see if they are responsive to the Request.

13 MR. WARGO: Your Honor, it depends how you do it. And I do not doubt that Mr. Gannaway just told you what he did and what happened when he did it. But this is a very easy thing to do that people do all the time who are in IT.

17 I'm sure his IT guy at his law firm could go on there, run a search and then you would have a print out -- a screen shot that says I ran this and it came back zero. Absolutely, your Honor.

20 MR. GANNAWAY: Your Honor, there is no requirement to do that.

22 THE COURT: No, there isn't. But there is -- you're asking them to believe you.

24 MR. GANNAWAY: Whenever we respond to Discovery, we're asking the other side to believe us. There is nothing extraordinary CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1043 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 about this one.

2 THE COURT: And-- well, I'm not so sure about that, Mr. Gannaway. With the number of times they have been in here and as much as I know you and Mr. Johnson are working well together, I don't feel the love amongst you guys completely.

6 Have your IT guy -- which I know your firm has or I presume they do -- produce the report of the review. Do the search. Show -- do the screen shot that we're talking.

9 MR. GANNAWAY: A screen shot of how many results came up?

10 MR. WARGO: The search terms and the results.

11 THE COURT: The search terms and the results.

12 MR. GANNAWAY: Okay.

13 MR. WARGO: Thank you, your Honor.

14 THE COURT: Because what you're telling me is nothing came up.

16 MR. GANNAWAY: No. Two things came up.

17 THE COURT: Right.

18 MR. GANNAWAY: Let me be clear: 19 The word ''Integrity'' produced things. Like Integrity is one of the mantras of the company. One of the company's core beliefs that their employees should operate under.

22 So, yes, "Integrity'' came up with results that were not responsive to their Request. Like "applications" and "Integrity" are part of TitleMax's deal. Your performance review. Do you believe you've met this standard.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1044 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 So, yes, there were things that came up. The only two that related to database searches were the two that I produced to them, your Honor.

4 THE COURT: Do the search again. Show search terms.

5 Provide the report and provide it to the Plaintiffs.

6 MR. GANNAWAY: And to be clear: 7 The report there were 40 documents that matched the word "Integrity". If that's what they want -- 9 THE COURT: Does it indicate what those documents are?

10 MR. GANNAWAY: No. 11 THE COURT: Do the search. Produce the report. Y'all look at it. And if you need to talk about it -- but go ahead and do it and produce the documents. Not the documents that -- 14 MR. GANNAWAY: Show them the screen shots of how many came up?

16 THE COURT: Show them the screen shot and show them what you produced.

18 MR. GANNAWAY: Okay.

19 THE COURT: Okay.

20 MR. WARGO: Thank you, your Honor.

21 THE COURT: Thank you very much?

22 MS. GOEBELSMANN: That's all for the Motion to Compel, your Honor.

24 THE COURT: Thank you very much. Motion for Continuance.

25 Did somebody oppose?

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1045 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014

1 MS. LOVETT: That would be it.

2 THE COURT: Why are you opposing it?

3 MS. LOVETT: Because the longer this goes on, the more difficult it's for my client to continue to do business. There are corollary lawsuits, as your Honor now knows, in Georgia this week, in South Carolina all boot strapping from your Honor's litigation whether you're aware of that or not.

8 And there is -- assuming that we adhere to the Court's Orders, and we will to stay away from the rabbit trails and cut to the chase, there is no reason this case can't be tried four and a half months from now, your Honor.

12 There's not -- 13 THE COURT: Well, I'm not so sure I agree with that because you have this new Overlap List that still hasn't been produced and we don't -- and Judge Peoples and his folks are still working on that, correct?

17 MR. JOHNSON: Yes, sir.

18 THE COURT: Do you have any kind of indication that when that Overlap List is going to be produced?

20 MR. WARGO: Do you know, counsel?

21 MS. LOVETT: I will answer the Judge's question.

22 Your Honor, the answer is: 23 I have no idea when it's going to be produced. But what I do know is that, according to representations counsel's made here today, when it is produced because Judge People's is working with CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1046 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 a technical advisor. When it's produced we will have a discrete list of names and we will have -- presumably and we will then have, according to them if what they told you is correct about their damages calculation as they were directed to provide under the Order of this Court, then they will just plug those names, enter that information and we will have a damage model.

7 So, my only my plea to the Court is that, if we drag this out too far -- and perhaps the Court could make an inquiry of Judge Peoples as to what a reasonable estimate would be. Because every single day the reputational risk that goes with this and the multiplication of litigation that goes with this is harming my client.

13 We're ready to go.

14 THE COURT: Well, we can't do anything about multiplication of litigation in Court.

16 MS. LOVETT: I know that, Judge.

17 THE COURT: This Court has no any control over that and will not have any control over how many times your client has to respond to any lawsuits filed against them. So, that's not a factor.

20 The Overlap -- our trial setting in part was determined based on the production of the Overlap List giving the experts enough time to review it and produce reports that are substantive and helpful in getting this case to mediation, among other things.

24 We're done for the year for all practical purposes in doing productive Discovery.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1047 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 How much work gets done from Thanksgiving to Christmas on litigation?

3 MR. JOHNSON: Very little, your Honor.

4 MS. LOVETT: Unfortunately at my firm a little too much.

5 THE COURT: A little too much?

6 MS. LOVETT: I've got January trials.

7 THE COURT: Okay. So, I am inclined to grant the Motion for Continuance. Problem that I have is at June trial date. And I will tell you why I have a problem with a June trial date and that is because our policy on Vacation Letters would allow you, anyone here, here to designate -- well, I shouldn't say that. Only lead counsel to designate a week in June as a vacation week and that gives you your own little Continuance.

14 You may not do that it that way in Atlanta or Los Angeles but we have that policy here that allows people to have a life during the summer and you can designate four weeks.

17 MR. WARGO: It gets hot here.

18 THE COURT: Designate four weeks in the summertime in which time you cannot be compelled to be put to trial.

20 If I grant you a June trial date, which is what you're asking for, who ever the lead counsel is could very easily give themselves a Continuance.

23 And I really want to avoid that because I think we are at a time where we have to fish or cut bait, so to speak.

25 MR. WARGO: Your Honor, does your rule -- and I'm sorry for CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1048 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 the ignorance of this -- is it July or summer?

2 THE COURT: Summer months. June, July and August.

3 MR. WARGO: Your Honor, we're the Plaintiffs and we want to try this case and we want to try it soon. I'm not going-- I take a vacation, but I'm not going to take vacation to mess up Your Honor's calendar.

7 Okay. So, you have that representation from me. 8 THE COURT: Let me just ask it this way: 9 Who's lead counsel? Is it -- 10 MS. LOVETT: Yes, sir.

11 THE COURT: If I grant you a trial date in June -- what is the date -- June what -- 13 MR. GANNAWAY: Your Honor, I think we may have submitted an Order that permitted your coordinator to enter the appropriate date.

15 THE COURT: Okay. I will grant the continuance. I will reset the case for June. I will put it in the first Docket in June, which is June 1st. Okay. I heard a grunt and a groan. What's the problem with June 1st?

19 MS. LOVETT: I know I am in trial May 15th in Marshall, Texas for two weeks.

21 THE COURT: Would you rather be there, or would you rather be here?

23 MS. LOVETT: Well, habeas corpus, your Honor, I'd rather be with Judge Gilstrap.

25 THE COURT: June 15th is the next -- CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1049 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 1 MR. JOHNSON: That is agreeable.

2 THE COURT: Is that okay? I will set it for June 15th so long as have and assurance by those here -- those lead counsel because that's really the only attorneys that have vacation 5 MR. WARGO: So, I can't switch it for him if -- 6 THE COURT: Whoever the lead counsel will not designate that period as their vacation period.

8 MR. WARGO: Yes, your Honor.

9 THE COURT: You agree to that.

10 MR. WARGO: Yes, your Honor.

11 THE COURT: Mr. Johnson?

12 MR. JOHNSON: Yes, your Honor.

13 THE COURT: Mr. Gannaway?

14 MR. GANNAWAY: I'm not sure who is going to be lead counsel on our side, but we will talk about it with the client.

16 THE COURT: Well, I'm going to get to her in just a second.

17 Do you agree to that?

18 MR. GANNAWAY: I won't do a June 15th vacation.

19 THE COURT: Thank you. Ms. Lovett?

20 MS. LOVETT: I will not.

21 THE COURT: Thank you very much.

22 Are these the four that matter as far as lead counsel is concerned?

24 MS. LOVETT: And, your Honor, the truth is without Mr. Hancock and Garcia to tell you, I can't represent to you that I CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1050 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 outrank them. Although, I can arm wrestle with them.

2 MR. GANNAWAY: And I'm certainly not contending for David Beck.

4 THE COURT: Oh, I forgot that David Beck is on the Pleadings here. Is he the attorney in charge?

6 MR. GANNAWAY: He's the first listed on the first filing that we had. I suppose if that is the standard. I don't think that we designated someone -- specifically an attorney in charge in our initial Pleading I think.

10 MR. WARGO: Your Honor, we're happy to work with them if they need an extra week or two. Okay. So, maybe we can get back to you on that?

13 THE COURT: I will tell you that on my Docket Sheet lists Johnson and Gannaway as the attorneys.

15 MR. WARGO: Well, you have that representation from our said.

17 THE COURT: And you apparently signed the Pleading.

18 Otherwise, it would be David Beck.

19 Okay. Anything else?

20 MR. JOHNSON: Your Honor, we appreciate your time. And I'm impressed with your stamina.

22 THE COURT: Well, I was losing it there.

23 MS. LOVETT: I'm not the least bit surprised.

24 THE COURT: And I had represented to my Bailiff this would only take a couple hours. I guess I was wrong. For which, I CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1051 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 apologize.

2 Everybody come get your documents.

3 (Hearing ended)

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1052 ORAL HEARING ON PARTIES' MOTIONS NOVEMBER 21, 2014 STATE OF TEXAS COUNTY OF HARRIS 4 I, Cynthia Martinez Montalvo, Official Court Reporter in and for the 152nd District Court of Harris, State of Texas, do hereby certify that the above and foregoing contains a true and correct transcription of all portions of evidence and other proceedings requested in writing by counsel for the parties to be included in this volume of the Reporter's Record in the above-styled and numbered cause, all of which occurred in open court or in chambers and were reported by me. 11 I further certify that this Reporter's Record of the proceedings truly and correctly reflects the exhibits, if any, offered by the respective parties.

14 I further certify that the total cost for the preparation of this Reporter's Record is $ ------- and was paid/will be paid by BECK REDDEN. /s/ Cynthia Martinez Montalvo Cynthia Martinez Montalvo, CSR 19 Texas CSR 6863 Official Court Reporter 20 152nd District Court Harris County, Texas 21 201 Caroline, 11th Foor Houston, Texas 77002 22 Telephone: 713-368-6037 Expiration: 12/31/2014 CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

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approved [7] 82/19 84/7 84/11 8S/13 87/15 Agency [1] 93/14 amended [7] 18/2419/2131/9 72/13 76/9 87/20 89/1 agent [2] 9/8 SS/7 77/10 87/17 approving [2] 8S/188/23 ago [4] 16/188/18 89/6 97/18 among [1] 1S7/23 are [269] agree [14] 26/1S 28/14 31/4 32/4 32/9 32/11 amongst [1] 154/5 area [1] 83/19 36/12120/16121/2137/20 139/191S6/13 amount [3] 14S/10 14S/10 147/14 areas [2] 67/17 83/18 160/9 160/17 analysis [2] 7/19 67/S aren't [6] S/7 2S/24 62/8 90/9 111/7111/23 agreeable [2] 33/19 160/1 analyze [1] 43/6 arguably [2] 64/23 6S/12 agreed [9] 64/1 83/S 84/8 90/24 91/1 96/1 and put [1] 1S1/9 argue [8] S2/21 S3/18 53/20 54/20 SS/24 106/13 106/18 117/2 and/or [3] 8/4 8S/188/23 56/2 61/19 64/17 agreeing [2] 119/8 140/3 Angeles [41 2j21 72/10 101j8 1S8/14 argued [21 so/24 S2/12 agreement [10] S/12 31/20 32/18 33/24 Anne [2] 113/14 114/17 arguing [61 49/16 S2/14 S2/14 s8/19 67/1 49/17 88/2110S/13 113/23 113/24144/18 annoyance [1] 72/10 84/16 agrees [2] 90/20 91/3 anotlter [9] 11/14 28/2 41/17 41/24 6s/16 argument [2o] 6/4 S2/1S3/2154/14 66/19 alta [1] 98/13 128/10 130/S13S/13 135/1S 66/23 68/4 69/18 70/12 70/1771/173/21 altead [13] 11j1612j17 22j2132j16 68/6 answer [19] 22j12 24j2o 4S/19 45/22 49/6 74/9 74/13 84/13 84/1S 91/11102/9 102/24 92/20 102/1S 121/2 126/1713S/24 149/18 S7/2181/2188/188/188/1S 88/16 90/190/2 150/22 152/16 1S5/12 120/6 136/18 142/3 144/14 1S6/211S6/22 arguments [1] 6S/18 aid [1] 61/1 answer's [1] 144/9 arm [1] 161/1 aiming [1] 18/23 answered [2] 51/8 87/18 around [6] 10/22 so/11 70/21 7S/161o6/16 akin [1] 28j12 answering [21 89j12 89j21 106/17 Alex [1] 40/7 answers [2] 118/17 123/12 arrises [1] 29/11 all [1241 4/2 S/7 7/2S 8/6 8/10 11/3 11/13 anticipated [1] 18/24 articulated [1] 73/9 12j22 12j24 14/8 15j16 18/9 18/18 18j19 any [69] S/119/3 9/719/13 37/13 39/20 articulating [2] 99/2S 100/2 20/10 23/20 23/2S 2S/S 2S/9 26/2130/9 41/19 44/2S SS/13 S9/2 S9/22 61/7 61/8 62/4 as [158] 4/22 6/3 6/14 7/6 7/16 7/20 7/23 32!19 36/4 4S/4 46/s 47/2o 48/24 49!22 64/171/23 8oj3 8oj3 8oj1181j19 82/5 96/s 8/24 9/2S 10/16 10/22 12/612/713/S 13/6 sols so/23 s1/10 s1/18 s1/19 s3/8 s3/14 99/2 99/2S100/3 103/1110S/18107/4112/2 13/614/2 14/S 18/20 19/1S 20/17 20/2S 21/5 s4/14 56/1s7/3 s8j22 s9/t4 61/1161!21 64/1 119/2120/4127/10128/16129/14129/22 23/16 2S/18 26/20 26/25 27/4 27/5 30/19 66/4 66/8 66/12 68/17 69/4 69/7 69/9 69/12 130/8 130/9 130/19 130/20130/21130/21 31/12 32/14 32/1S 33/12 34/4 36/13 36/1S

1055 awarding [1] 91/6 84/10 84/16 86/2 87/17 89/15 91/22 102j18 A aware [4] 30/21 31/12 40/2 156/7 108/1109/4110/23118/24125/14126/7 as •.• [121] 37/3 37/3 37/3 37/739/9 39/25 awav r4f 4f22 6qf8 7oi111!i6fq. 129/15132/4142/24145/6145/7149/19 42/2147/2 50/7 50/12 51/1152/5 57/14 57/15 149/19 61/5 61/6 64/6 66/23 68/168/169/4 69/14 B began [2] 9/14 9/17 69/22 70/8 70/12 70/15 70/18 70/20 70/22 back [31] 6/15 21/121/8 23/17 25/7 28/16 beginning [2] 19/15 103/18 72/1 72/13 72/16 75/2 75/13 75/13 77/18 42/2147/147/9 53/14 53/19 55/9 55/16 57/6 behalf [9] 4/9 4/114/17 48/10 55/6 ss/8 77/18 78/178/2 78/5 78/17 78/17 84/2 84/14 64/21 75/1175/15 75/16 76/18 90/6 90/19 59/15 89/16 97/19 86/5 88/2190/190/190/2 90/4 90/6 91/19 91/4 91/7 96/1102/24104/11108/3146/3 behind [2] 58/20 145/2 92/17 92/18 93/17 94/5 94/7 94/13 95/14 146/5 153/19 161/11 behold [1] 95/4 95/24 96/18 96/23 102/20 102/20 103/19 background [1] 63/23 being [17] 19/19 40/2 46/16 68/14 75/21 104/3104/3 105/1105/1105/3105/3105/4 bad [3] 51/24 53/19 78/20 77/2 82/24 91/19 95/12 99/14114/5119/1 106/1107/14108/11111/19113/23116/24 Bailiff [1] 161/24 120/7134/20138/4138/5147/13 117/1118/12122/3 122/20 123/22 124/14 bait [1] 158/24 belief[1] 152/1 125/6126/16127/11129/1129/1129/2129/2 baited [1] 31/4 beliefs [1] 154/20 129/7129/7129/9135/11135/23137/5 ball [2] 49/21 53/11 believe [40] 6/19 6/2415/1317/8 26/17 137/20 139/17139/19 141/13 144/2144/21 ballpark [1] 136/15 33/10 40/12 45/13 54/4 61/14 61/16 68/3 145/16145/21146/4146/4146/20149/22 bang [1] 6/12 75/3 77/14101/12101/23102/3102/4108/10 152/19154/3154/4156/5157/4157/9158/12 bar [1] 72/17 111/6114/4115/6115/11120/25121/16122/13 160/3 160/7160/22160/22 161/14 bare [1] 67/4 126/15126/20 131/19 138/18 138/24142/20 ASBILL [1] 2/4 bars [1] 66/19 144/1 146/18 146/20 150/18 151/23 153/23 aside [2] 66/14 75/6 base [3] 10/20 21/25 71/11 153/25 154/24 ask [15] 9/2137/13 43/6 44/17 64/18 97/12 based [29] 7/19 11/6 14/515/2 15/15 18/22 Bench [1] 110/4" 99/15107/1112/14137/6137/15147/2147/6 18/24 22/3 22/14 28/17 37/3 37/13 37/23 benefit [1] 4/4 147/7159/8 37/24 40/19 42/12 46/15 52/22 70/16 80/24 benign [1] 126/9 asked [23] 11/911/9 30/2 37/9 38/16 42/22 84/23 99/14113/11127/19 134/17142/3 Bennett [1] 21/23 49/5 52/16 52/18 52/22 80/10 82/24 83/17 145/22150/22157/21 besides [4] 12/3 38/6 56/20 56/22 90/14 94/15 95/12 97/22120/24121/4121/15 basic [2] 90j2o 105/7 best [4] 68/170/12 78/15 101/9 125/2125/2151/17 basically [2] 110/5150/20 between [1o] 6/15 25/1141/9 57/6 69/16 asking [28] 8/110/15 10/1713/23 13/25 basing [2] 70/19 71/21 70/3 82/6 130/20139/15 146/2 15/5 23/7 25/23 31/23 38/23 39/3 39/12 basis [15] 7/16 8/9 8/1117/122/15 42/18 beyond [13] 15/4 30/7 67/4 81/22 84/5 39/17 40!17 40!25 42/24 8s/s 87/24117!13 47/7 61/15 96/1104/5108/3120/11127/12 93/8 96/7111/5 116/24129/22142/16144/17 122/22126/13133/23137/1137/2147/16 129/11131/25 144/22 153/22153/25 158/21 Bates [1] 13/21 bill [5] 59/10 82/15 82/17 84/7 84/12 asks [1] 133/2 be [204] binder [1] 107/14 aspect [2] 79/7146/21 bear [5] 35/15 s8/25 s8/25 61j12 65/10 binders [1] 131/12 asserted [1] 58/13 beat [3] 68/10 68/12 68/12 bit [11] 16/7 25/2175/11 76/1 76/21 76/22 asserting [2] 58/12 91/17 because [112] 8/14 8/25 9/7 9/710/610/19 76/23 91/18 97/1119/20 161/23 assertion [4] 51/2158/25 107/21117/9 11/1711/2013/1614/1015/1116/717/317/15 bite [1] 12/18 asses [1] 118/8 21/7 21/14 23/20 23/23 26/126/23 28/11 bitty [2] 86/24 86/25 assistance [1] 7/12 29/10 31/17 35/17 36/136/22 37/6 38/25 blal! [3] 55/15 55/15 55/15 associated [4] 7/2177/22 97/3140/5 39/23 40/16 43/15 44/14 45/23 49/16 50/1 blame [1] 90/7 assume [8] 17/16 41/4 41/7 41/8 52/16 so/3 sols so/15 51j22 53/19 54/8 56/10 Blane [1] 99/18 52/18 52/22 64/5 56/17 59/11 60/4 65/19 66/17 71/19 72/8 blanks [1] 19/2 assuming [1] 156/8 72!19 72/23 78/9 8o/8 83/2 84!12 8s/s Blase [2] 99/20 100/7 assumption [2] 98/16105/20 86/1186/23 88/2189/6 90/5 90/19 91/4 Blaze [1] 99/17 assurance [1] 160/3 91/15 91/20 92/2 92/11 93/6 95/17 96/3 Bob [4] 22j22 22/24 23/123/8 assure [2] 73/1 90/23 96/24 97/22 97/25 98/5 98/7 98/22103/8 boilerplate [1] 42/10 Atlanta [4] 2/13 92/7 92/9 158/14 108/16110/19111/5115/14117/9118/18 bones [2] 65/10 67/4 atop [1] so/s 118/23 119/25 122/24124/2124/23 125/3 bonus [3] 105/1135/3 137/24 attached [3] 98/17112/24118/11 125/24126/8 129/14133/6133/16134/21 bonuses [1] 135/2 attempts [1] 65/16 137/25141/20141/22142/6142/22149/12 boot [1] 156/6 attention [1] 92/12 150/23 151/7152/1154/14156/3 156/13 borne [1] 109/23 attorney [4] 48/13 100/12161/5 161/8 156/25157/9158/10158/23160/4 borrower [2] 77/23 77/23 attorneys [2] 160/4161/14 BECK [5] 3/4161/3161!4161/18163/15 botlt [10] 20j12 22/17 31/14 32/139/14 41/5 attorneys' [10] 8/3 31/7 31/10 31/16 31/21 beckredden.com [1] 3/7 41/19 43/12 110/4 114/22 32/132/6 32/13 32/15 34/6 becomes [1] 73/2 bottom [4] 48/s 71j12 72/11124!18 attributable [1] 22/8 bed [2] 151/10 151/12 bottomless [3] 119/7119/8 121/13 August [13] 77/1178/179/779/11109/5 been [81] 5/115/12 5/14 5/15 8/4 8/7 8/11 bought [5] 39/4 39/5 40j2142/2122/17 109/7113/3113/12 123/2 124/13 124/14 13/5 13/20 19/5 19/16 20/11 20/11 20/17 box [3] 113/4 115/8 123/2 132/21159/2 21/16 22/7 24/14 26/3 26/22 27/1 27/6 36/1 breach [3] 98/18105/13 105/21 August 19tlt [2] 79/7 79/11 37!2o 38/17 38/24 39!2o 54/14 s4/17 s8!10 breached [6] 8/4 62/12 62/16 65/3 65/13 August 2011 [1] 132/21 61/25 62/24 63/24 64/12 65/7 65/13 67/14 105/14 August 23 [2] 109/7113/12 67/17 68/24 68/24 73/2 74/23 74/25 76/8 break [2] 80/9147/7 August 23rd [5] 109/5 113/3 123/2124/13 76/20 77/7 78/s 78/6 78/10 82/23 8s/3 breatlt [1] 31/4 124/14 89/24 93/2 95/18 96/18 96/22 97/2 97/10 BRENNAN[1] 2/4 Austin [4] 14/136/22 81/6136/17 97/13 103/18104/17105/13105/24106/10 bridge [2] 69/15 69/25 autltority [1] 88/22 108/1115/14116/24120/12 121/1134/6 Brief [1] 74/6 autltorized [2] 48/13 63/3 134/12138/7140/11142/3142/19147/6 briefly [1] 75/13 available [3] 11/14 68/13 70/10 149/10 149/13 149/13 150/17154/3 156/14 bring [4] 31/18 70/1192/10 106/23 avoid [4] 15/6 30/12 146/6 158/23 before [39] 1/1810/413/20 24/6 25/7 bringing [2] 59/14 86/24 award [1] 14/25 25/14 34/20 36/2 41/23 42/3 43/16 44/22 brings [1] 138/14 awarded [2] 19/19 138/4 50/24 59/6 59/7 60/2 63/14 63/22 82/23 broad [1] 13/7

1056 B 115/20 122/2 136/24151/11151/25 156/10 cheat [11 15/25 157/14160/5 160/25 chose [21 34/9 48/25 broader [11 86/1 cancelled [21 50/9 50j21 Chris [11 4/20 broke [11 8/15 candidly [31 14/716/7 40/15 CHRISTINA [31 2/18 4/9 132/12 broken [11 9/24 cannot [81 36/12 45/14 70/16 70/18 71/5 Christmas [11 158/1 broken-down [11 9/24 71/11117/6158/19 circuit [81 23/22 63/7 63/12 63/17 64/22 brought [51 67/14 72/18 75/9 85/11105!22 capable [11 142/25 67/1776/1147/25 brunt [11 35/15 Capital [11 109/17 circumstances [21 48/17131/20 Bryant [11 81/7 car [31 109/17110/7117/21 cited [31 62/6 63/7 94/8 buck [11 6/12 care [91 53/157/8 63/14 63/20 86/3 86/4 Civil [21 61j12 65/11 Bucket [31 79/23 79/24 8oj2 86/5 146/16146/17 claim [181 13/8 13/13 15/15 16j1o 16j22 bunch [21 52/25 69/17 career [11 74/16 16/2417/24 19/17 37/5 40/18 62/9 70/19 bundle [11 6/4 careful [11 67/18 70/19 71/5 71/20 95/19 95/23 125/12 Burbridge [11 93/14 Carolina [11 156/6 claimant [21 62/1 62/2 burden [81 41/25 42/4 50/8 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142/13 150/20 103/19 104/5 104/22105/8 108/6116/25 140/10 154/18 155/6 buy-out [61 27/9 79/2180/18 86/6 88/4 120/25 134/13 134/21135/12 135/17 136/4 clearly [31 105/14 105/14 151/22 136/5 149/22150/16156/10157/23159/4159/16 click [41 64/13 64/14 64/19 153/11 buyers [11 83/7 cases [51 52/24 92/2 92/4 92j12 97/16 clicked [71 64/19 71/2110/20 113/16116/15 buying [31 39/19 39/2140/19 catch [11 23/23 116j19 130/25 buy~;::~ [11 ;;2/1 categories [41 49/16 49/17 49/20 50/23 client [191 13/5 19/3 33/23 56/12 67/175/20 buit 1 n80 category [21 25j2o 94/18 86/18 94/2194/23 100/5100/11108/16 c causal [11 73/3 causation [71 10/210/3 10/1417/1119/14 117/10133/8136/13156/4157/12157/18 160/15 CA [21 2/11 2/19 66/20 69/14 client's [11 118/2 calculate [21 9/23 10/25 cause [151 1/3 1/18 19/13 65/23 65/24 66/6 clients [11 82/9 calculated [51 6/24 8/16 37/16119/14 66/22 70/16 70/18 71/18 71/25 71/25 72/1 close [61 33/8 41/1148/9 48/9 58/6150!4 138/10 72/18 163/9 clue [11 43/2 calculation [71 7/2 7/18 8/3 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104/21105/2107/13110/3110/4112/3112/5 challenge [11 43/24 comma [11 24/23 112/8 112/20 113/23 115/21116/9 116/10 chambers [11 163/10 comment [21 93/20 144/20 118/8 119/10 120/17121/8 121/19 122/3 122/8 Chance [11 114/18 committed [31 18j23 62/4132!5 122/15 122/18 124/12124/14124/18 124/21 Chancery [11 7/7 committing [11 61/17 126/16 126/17128/16 130/16131/20134/11 change [31 24j12 26/5 121j12 common [21 9/11 9/13 137I 4 139!10 141/4 141/4 141/17 142/1 142/1 changed [11 62/3 commotion [11 86/25 143/24144/2 144/17145/8 146/2146/20 Chapter [41 49/11 61/6 61/24 63/2 communication [11 58/24 147/25147/25148/6151/2151/19158/16 characterization [11 85/24 communications [121 38/13 50/17 60/11 161/1 161/11 characterized [11 74/13 84/24101/19117/15130/8130/20131/11 can't [281 12/616/25 17/2 19/9 19/9 21/7 charge [61 56/4 57/3 57/7 73/23 161/5 161/8 139/15140/4141/2 26/10 28/166/23 68/20 71/18 71/18 72/16 charges [11 8/17 community [11 147/13 73/17 94/10 94/25 100/2 lll/16 114/13 chase [21 24/15 156/10 companies [41 38/6 51/18 61/4 94/14

1057 c contemplating [1] 12/14 contend [3] 7/8 14/18 149/23 127/8 140/20161/25 couriers [1] 70/3 company [24] 9/5 40/3 45/1151/4 51/17 contending [1] 161/2 course [4] 32/10 64/2 64/9 72/7 s1/18 s1/19 s6/8 5717 57/17 S7/2o s8/1S9/4 contention [2] 124/23 125/3 court [6o] 1/31/5 4/4 6/s 6/19 6j2o 6j22 81/10 83/9 83/12 83/13 84/4 85/2195/11 contents [1] 153/7 7/15 9/2210/411/211/1511/1816/1719/19 109/18147/9147/14154/20 contesting [1] 98/9 2212 23!2126/s 31!12 44/s 44/16 46/2 49/16 company's [3] ss/23 85/22 154j2o context [3] 29/1189/14125/24 49/22 s1/9 s8/14 s8/19 59/12 59/14 6oj2 company-wide [2] 83/9 84/4 continuance [11] 11/17 33/11 60/18 101/10 61/2 65/171/17 71/20 76/17 84/19 86/25 compare [2] 30/9 106/23 101/13 101/16155/24158/8 158/13 158/22 89/25105/3107/3107/17108/2108/4111/12 compel [28] S/17 S/17 5/18 5/22 6/8 6/17 159/15 117/17121/1129/15129/19 133/7152/1157/5 8/18/8 12/2s 8s/6 89!17 89/19 90/11101112 continue [6] 96/2 97/9104/22112/8120/17 157/7157/8 157/15 157/17163/4163/5 163/10 101/18 101/21101/22 102/2 102/17 102/17 156/4 163/19 163/20 132/16 137/1137/24 138/15 138/15 149/18 continued [1] 8/15 Court's [9] s/25 8/8 22/5 62/9 84/24 152/11155/22 continuing [1] 92/19 100j18 111/9 118/2156/8 compelled [4] 14/13 32/136/21158/19 contract [12] 16/2417/617/2317/2418/3 courthouse [1] 86/3 compelling [1] 35/3 18/419/5 19/17 35/6 35/8 110/8 134/9 cover [1] 145/3 competitor [1] 145/15 contracted [2] 22j20 23/1 covers [1] 145/3 competitors [10] 80/180/S 83/8 88/6 contracts [22] 8/3 15/2216/6 16/8 16/11 Crawley [1] 58/14 125/6 130/11131/15131/17143/25 144/5 16/1316/2016/2116/2517/2017/2218/14 create [1] 86/8 competitors' [1] 85/2 18/18 18/20 25/19 35/2 35/1135/22 35/24 created [9] 75/14 81/8 81/9 81/12 85j2o complain [3] 10/1195/13 98/4 36/4130/9130/20 86/7 86/17 86/20 87/3 complaining [4] 77/178/23 83/12 99/22 contradicted [2] 54/14 103/8 creates [1] 73/4 complaint [3] 40/18 40/18 76/17 contradiction [1] 118/22 creation [1] 80/17 completed [8] 33/9 39/24 77/7 77/8 77/9 contribute [1] 65/25 Criminal [1] 73/19 77/1178/14108/s contributed [8] 61/7 62/4 67/9 68/18 72/14 critical [1] 8s/8 completely [4] s/15 29/22 36/14154/5 72/18 72/22 73/12 cross [1] 122j18 complicated [1] 71/8 contributes [1] 119/5 cross-examine [1] !22/18 complied [8] 8/8 74/23 77/2 77/4 79/3 contribution [1] 72/23 crystal [2] 46/7 so/4 80/20 90/3 142/24 contributory [1] 61/20 cso [3] 8/17 10/10 15/16 complies [1] 17/9 control [4] 122/1147/1157/17157/18 CSR [2] i63/18 163/19 comply [4] 78/15 79/7 79/9 90/15 convert [1] 64/8 cull [2] 78/4 78/11 complying [1] 74/11 coordinator [1] 159/14 culpable [1] 84/13 components [2] 11/12 15/16 copies [2] 81/25 82/6 curb [1] 75/5 comprise [3] 10/9 10/10 10/10 copy [5] 16/2 s8/s 70!2 102j1111oj3 curious [1] 144/11 computer [5] 38/17 38/2155/17 66/8 148/9 copying [2] 129/1130/12 current [2] 46/13 123/25 computerized [1] 1j21 core [5] 70/15102j2o 143/12143/16 154/2o currier [1] 70/3 computers [1] 152/18 corollary [1] 156/5 custody [1] 147/1 concern [7] 6/2129/10 91/15103/17119/2 corporate [21] 49/10 49/18 49/24 49/25 customer [68] 7/2 7/14 7/17 7i23 8/2 8/18 132/10 145/5 so/2152/13 s8/19 6o/3 81!1 81/4 81/1s 8/19 9/25 10/8 10/20 11/711/13 11/14 11/24 concerned [8] 103/8 103/13 103/25 108/16 81!2182/19 85/14 86/4 86/10 87/16 91j22 12/414/614/614/614/1914/1917/1017/10 111/10 118/20131/10 160/23 104/17137/16141/11 18/419/5 21/25 22/4 22/10 22/10 22/11 concerning [5] 48/16 55/14 111j12 114/11 corporation [1] 90/9 22/13 23/8 23/13 25/7 25/17 26/23 27/1 120/25 corpus [1] 159/23 28/15 29/4 30/8 30/12 70/770/7 80/19 concerns [1] 102j2o correct [24] 5/9 6/18 18/24 20/9 20/10 81/20 88/24 98/20105/22 105/24106/25 conclude [1] 63/19 20/22 26/13 26/17 27/25 32/2 51/5 60/19 108/16 109/6 109/13 110/14110/17110/18 conclusively [1] 66/2 60/20 67/23 76/8 89/3 90/22 120/16 120/21 112/19 114/2116/14 116j21121j16121j17 concrete [1] 145/8 120/22123/19156/16157/3163/6 123/11123/25 124/14 125/17126/10 141/15 conduct [23] 7/117/217/2415/12 22/8 corrected [2] 78/1178/19 149/25 37/9 40/19 43/2144/16 61/9 62/5 71/2 75/5 correcting [1] 6oj21 customer's [2] 116/14 126/1 96/20 99/22105/3110/24112/5112/9127/18 corrections [1] 150/8 customers [66] 6/25 7/19/119/1315/2 134/12134/16 138/3 correctly [2] 11/2 163/12 15/2016/10 20/18 20/18 21/3 21/4 21/10 conducted [7] 9/3 102j21108j9 110j1 correspondence [2] 117/5139/15 21/11 21/11 21/16 22/6 22/17 37/25 47/13 111/19 124/6 124/25 cost [5] 94/2194/22 95/1199/23 163/14 47/14 55/17 66/8 66/9 69/20 79/22 80/1 conducting [3l103/14 104/14 130/11 costly [1] 119/4 8ofs 85/10 85/1186/6 88/4 88/6 88/8 99/14 confer [4] 88/22148/1148/3 149/11 costs [1] 7/21 99/21 103/16 103/23 105/17 105/18 106/8 Conference [1] 35/18 could [27] 11/4 24/14 43/10 47/22 48/12 106/11107/22108/17108/19 108/23108/25 conferring [1] 33/23 53/24 61/25 64/19 66/7 70/13 73/10 78/17 112/17117/20 119/24119/25 120/3 120/5 confirming [1] 17/13 84/5 86/20 91/19106/10 111/14119/13119/14 124/8 124/1212S/lll25/23 126j6129j1 confused [1] 16/7 ll9/17120/7136/20 144/5 151/18 153/17 129/16129/20 130/ll131/15 138/8 141/1 confusion [3] 25/22 6s/7 6s/8 157/8158/21 141/11143/6 connection [1] 73/3 couldn't [2] 26/3 85/12 customers' [1] 131/17 Consent [1] 75/14 counsel [38] 2/7 2/15 2/23 3/7 3/14 4/20 cut [8] 16/1 23/17 24/6 30/18 65/1105/19 consider [4] 47/19 73/24 90/5 144/16 21/13 21/2130/14 33/147/2 47/5 47/9 47/17 156/9 158/24 consideration [1] 91/8 48/2 48/3 48/24 49!2 s8/9 88/2190/2o cuts [3] 82j22 85/4 86/24 consistent [2] 14/17107/17 90/24 91/2102/9 107/14108/1108/12 110/4 Cvuiliia r~i 16~7~ 16~ii716~il8 consult [1] 86/18 151/24156/20 158/ll158/21159/9 160/3 consuming [1] ll9/4 160/6160/14160/22163/8 D contact [1] 47/13 counsel's [2] s8/25 156/24 dfb/a [5] 1/5 1/51/6 1/6 1/7 contacting [1] 136/11 counter [1] 40/18 Dallas [9] 14!136/2183/19 84/184/24 contain [1] 22/9 counter-claim [1] 40/18 116/12 123/6 134/16 134/17 contained [3] 12/2178/23 138/22 country [2] 96/s 144/19 damage [15] 6/216/23 7/16 8/9 8/1110/8 containing [1] 38/11 COUNTY [4] 1j8 1j20 163/2 163/20 11/19 17/9 21/6 26/4 28/14 35/20 37/12 72/1 contains [4] 20/8 50/17153/9 163/6 couple [9] 8/442/9 75/20 8s/6 89/8123j12 157/6

1058 demand [1] 15/8 difficulty [1] 72/9 D demanding [1] 14/21 dilatory [1] 37/9 damaged [2] 66/9 66/9 demonstrably [2] 109/13 149/23 direct [7] 7/20 59/19 61/169/16 82j18112/1 damages [20] 7/1910/2311/2415/119/19 demonstrate [1] 138/1 142/13 24/1125/13 25/15 25/17 27/3 27/4 28/8 36/11 demonstrated [2] 75/3112/5 directed [9] 48/25 59/16 59/18 83/7 83/15 37/5 37/7 39/2 61/8 68/23 68/24157/4 demonstration [1] 152/25 94/6100/3148/16157/4 DANIEL [3] 2/3 4/8 83/1 denied [2] 84/20100/13 direction [4] 5/25 84/25 85/17 151/13 Daniel.jobnson [1] 2/7 denies [2] 47/4 47/10 directly [2] 39/2 68/23 darn [2] 55/15 75/21 deny [3] 59/2 136/5 138/9 disagree [4] 11/8 15/10 29/22 45/23 data [13] 25/141/22 67/12 67/18 75/20 denying [3] 100/15 101/1138/13 disclose [3] 6/23 11j18 63/4 76/1199/19 113/2 148/11148/14148/19 149/2 department [4] 81/1 81/13 89/1114/8 disclosed [1] 63/20 150/11 depends [1] 153/13 discouragement [1] 13/16 database [18] 6/441/4 63/12 68/13 70/5 depo [1] 49/20 discover [2] 110/23 119/9 71/9 78/6 78/7 78/11 95/2 96/s 97/3 97/6 Deponent [1] so/8 discoverable [1] 137/11 114/9129/2 130/21140/7155/2 depose [17] 49/25 50/2 50/22 so/24 53/22 discovered [1] 77/24 databases [22] 63/23 67/13 67/14 78/4 54/24 55/2 57/17 59/10103/23 110/23 111/14 discovery [54] 6/17 6j22 7/119/313/7 79/25 8o/s 87/9 87/1188/s 88/8 94/6 95/18 115/16 124/18 126/18 127/15 134/14 28/1129/1131/9 37/16 43/2144/13 44/23 96/2 97/23 98/10 105/19109/12 134/9 deposed [7] 55/19 85/3 111/15 113/10115/11 46/1146/12 75/7 77/10 78/23 84/3 88/10 139/18 140/5 141/1143/14 115/13 124/10 92/14 93/1 93/9 95/15 96/17 96/23 97/1 DataTrax [41] 61/4 62j2o 62j21 62j22 deposing [1] 127/9 97/22 98/2 98/22 100/3 101j18 112/8112/13 63/8 65/4 65/23 66/2 66/12 69/770/2 71/7 deposition [34] 27/6 38/15 45/6 49/10 119/12119/14120/9 121/22128/10 129/12 81/20 82/10 94/7 95/1 95/19 96/4 103/20 so/9 so/2151j13 s1!23 s2/13 58/12 s8/14 132/7 133/12 134/7134/12 134/18 135/18 106/15 106/17106/22 109/11112/1130/21 59/2 6oj9 8oj24 81/6 83/11 84/23 91/23 136/20 138/11141/19 144/19 150/2 150/15 136/6139/13 139/18 140/5140/7142/13 96/10 104/18 110/24 115/16 120/19 120/24 151/18 153/24157/25 143/13 143/17 148/8 148/13 148/13 149/20 121/9 121/10 121/20 122/19 127/19128/8 Discovery Responses [1] 31/9 150/13 152/24153/9 153/10 128/9147/4147/7148/15 discrepancy [1] 110/22 DataTrax's [1] 103j21 depositions [4] 70/13 83/15 83/25 120/23 discrete [1] 157/1 DataTraxfPublicData.com [1] 82j10 Deputy [6] 47/9 47/17 48/148/3 49/2 58/9 discretion [1] 57/3 date [29] 9/1411/17 26/25 31/19 32/9 32/15 derive [1] 18/10 discuss [3] 35/24 59/5 6oj1 32/20 33/3 34/9 79/10 88/18 89/9 90/15 derived [2] 18/7124/6 discussed [3] 83/1 85/24 89/15 91/24101/25 104/11113/2113/24113/25 describe [1] 10/6 discussion [4] 46/24 59/3 74/6 86/1 116/20122/21137/9138/17158/8158/9 describes [1] 64/14 discussions [1] 75/1 158/20 159/11159/12159/14 describing [2] 10/2 72/12 disingenuous [1] I0/18 dated [4] 48/2 48/7 79/6 130j21 description [2] 10/711/10 Dismiss [1] 72/19 dates [3] 18/8 40/16 40/16 designate [10] S/20 6oj22 61/7 61/25 displayed [1] 114/5 Dave [3] 33/14 33/2133/22 66/23 158/11158/12 158/16158/18 160/6 dispose [1] 6/6 David [3] 161/2 161/4 161/18 designated [2] 61/3 161/8 disprove [1] 106/10 day [13] 1/17 so/150/1150/2158/22 66/6 designation [2] 67/2 67/3 dispute [2] 48/20 52/24 66/8 66/12 77/12 92/21116/14119/14157/10 designed [t] 73/5 disputed [3] 52/10 53/14 57/24 days [8] 33/8 34/2o 44/22 so/24 77/12 designing [2] 85/1 88/23 disputes [2] 36/1 94/20 78/12 78/15 88/2 desist [2] 48/7 48/25 disrespectful [t] 23/20 dead [1] 73/21 desperate [1] 138/7 distraction [2] 52/12 6o/4 deal [sl 73/1 91!13 98/10 149/19 154/24 despite [t] 94/20 distribute [t] 70/4 dealing [2] 90/19 130/17 destroys [1] 73/3 district [23] 1/51/10 62/7 81/7 81/8 82/18 dealt [1] 83/16 details [2] soj18 77/18 132/20 132/21132/23 133/2 133/3 133/11 deatlt [3] 82j22 85/4 86/23 Detective [1] 93/14 133/14133/23 133/23 134/24135/7135/12 debated [t] 49/9 determination [1] 36/12 135/12135/21137/18163/5 163/20 December [3] 14/10 47/148/2 determine [7] 26/22 40/10 44/16 121j14 districts [7] 132/24133/9 133/10133/17 decide [2] 65/2 119/11 122/9 132/5 133/12 133/22 136/12 136/17 decides [1] 41/14 determined [2] 49/20157/20 Diverse [1] 62/25 decision [1] 86/10 determining [1] 129/11 diversion [t] 6o/4 decisions [2] 69/12 69/24 device [t] 147/1 DL [2] 113/5113/5 declaration [3] 105/12105/15107/23 devices [1] 146/25 DMV [to] 6/3 129/2 130/21139/13 139/18 declarations [6] 102/25 103/8 103/14 did [62] 8/14 8/1512/912/1114/416/116/4 140/5 140/7141/1142/13 143/15 104/3 107/3 129/19 21/22 25/12 27/24 37/24 40/2 52/19 55/19 DMV's [t] 96/6 decline [1] 13/20 59/4 60/162/14 62/18 62/20 62/22 64/18 do [150] 6/13 8/18/25 9/210/112/514/4 declined [1] 149/4 64/19 64/19 6s/23 66/11 69/7 8oj24 83/17 14/2415/115/1816/1217/1518/1519/919/9 deems [t] 75/2 88/1 88/11 88/15 89/17 89/18 91/10 95/6 21j12 23/2124!1 26/5 29/1s 31!1s 32/s 32/6 Defendant [14] 5/16 8/12 9/8 46/8 46/20 96/23 98/18 100/25 101/1103/11107/21 35/9 36/22 39/12 40/17 42/20 42/25 43/6 52/9 53/3 54/20 78/22 79/19 88/2 88/22 109/10 110/11111/21124/12 135/20 135/21 44/21 45/13 45/20 52/8 53/20 55/12 55/13 96/1103/20 135/21135/21135/25136/1136/1136/6 ss/2156/s 56/15 56/18 56/22 s6/24 6oj18 Defendant's [2] 6oj22 78/4 139/19141/14146/22147/2147/7149/18 61/6 61!1162/22 6s/6 67/1168!17 70!24 DEFENDANTS [15] 3/7 3/14 4/6 4/18 4/19 153/14 153/15 155/25 71/13 73/6 73/8 73/20 74/20 74/2175/12 5/19 5/20 12/8 13/8 22/18 36/19 38/14 74/11 didn't [36] 10/110/1110/18 43/8 44/1 75/13 75/19 75/19 76/18 78/9 78/12 83/21 84/25100/10 45/18 51/13 52/17 52/21 53/20 55/24 59/20 83/22 87/2 87/2 87/3 87/4 87/6 87/2190/4 Defendants' [3] 6/3 6/16 96/19 66/6 66/25 72/24 72/25 84/8 86/8 88/12 94/13 94/17 94/19 95/9 95/12 98/198/8 defense [3] 33/1111/15 120/9 91/18 92/8 98/8 103!17108/14110/3 110/8 100/12101/5101/5106/22107/4110/17 defined [2] 107/2116/24 111/2111/21112/1129/19137/15140/10 111/13 111/16 113/5 115/17117/7118/13120/18 definitely [t] 143/18 145/19145/21147/6148/13 120/25 121/13 121/25 122/2 122/3 122/8 definition [1] 50/4 difference [4] 82/6142/10 145/9 145/12 123/25 124/7124/15 126/16 127/20 133/12 DeLeon [7] 99/17 99/18 99/21100/6100/7 different [8] 8/16 27/5 32/6 35/8 49/3 134/7 135/15 135/15 136/10 138/7138/22 100/8 149/8 110/13 117/21118/7 139/7140/14140/16142/1143/24144/6 DeLeon's [1] 150/11 difficult [3] 19/3 86/16156/4 144/15145/25146/8146/24147/7147/18

1059 140119 141120 141122141124 14411144114 161119 D 14sl2 14sl1114sl1s 14sl22 148ls 1sol3 elucidation [1] 7918 do ••. [27] 148120 1SOI22 1SOI2S 1S1I13 1SOI141SOI18 1SOI23 1S113 1S1I171S1I23 Email [4] 46110 99l16106l2114ol8 1S219 1S2I13 1S3I13 1S3I13 1S311S 1S3I16 1S41 4 1S611S 16117 Emails [4] 46l1s so112 sol1s 143119 1S3I20 1S4I71S4I71S418 1S4I241SSI4 done [48] 19110 24I2S 47122 4917 5019 employ [1] 131122 1S5I111SSI121S6I41S61181S6I20 1S6I24 61113 6sl6 7o114 70117 71116 7312 73113 employed [3] 131113 13417139116 1S71141S8I14 160117160118 163IS 78120 9111194112 94112 94117 9SI3 9sls employee [15] 4613 46l18 46l2o 47123 do it [1] 101ls 9717 99114101114 101I1S101I1S101I16 48l1148l19 48l2o 4914 sols s1122 S314 Dabney [51] 10SI1110SI1S 105l1610sl23 101I17107IS108I23112I2S119I23119I24 66112 104118 123111141111 106l6106l12107l4107l21108l7108l19 119I2S120I2128IS129I1S13SI4143I10 employee's [1] S1l23 108123 108124 109IS 10917109116 110111 143118 14418 148I1148I17149I171SOI6 employees [42] 38116 38l2o 40125 4112 110I23112I2112I16113I1S114I111SI13 11719 1SOI7150I241S2I18157I241S811 41ls 47l11s712o s8l10 s8l16 s917 6o12o 117111119123 120I1S 120119120120120124 door [1] S9l6 63I2S 66116617 6611179119 8813 88124 120I2S 12117121122 12214122118 123114 double [3] 20123 96124 13917 102121103111031101041410419104117 124112124120 126I18127I19127I22127I2S double·take [1] 96l24 104125 108ls 1o8l712111412212412911 1281112818 12916 129110129122131121 doubt [4] 32I2S 7SI18100I24 1S3I14 131I22134I4134I1S13SI113SI2 13SI19 132111142112 14SI19 14617 down [27] 8116 9124 13I714I1S 3814 S7l21 13SI2S137I10 139I12140I4146I2S1S4I21 Dabney's [3] 107119121118 13217 s8l21s9l6 6ol9 66l1168l1o 70112 7sl8 employer [2] s1l13 s1l14 Docket [3] 6I141S9I16 161113 8019 8612 87I2S 8911310711116123118114 employers [1] 63125 Doctrine [6] 4SI24 4617 46l21s2l16 S2l23 119116 120I1S 12011812119 12511412617 employment [2] 13012213414 S212S 141IS end [7] 2418 32120 40l16 6616 97I714SI6 document [14] 29116 S3l17119l10 13SI9 drag [1] 1S717 14SI7 148/7148I2S 149122 1SOI14 1SOI22 1S1I22 dragged [1] 4122 ended [5] 9114 9117 2SI8 26l1162l3 1S212 1S213 1S313 1S3I9 dragging [1] 14111 ends [5] 2SI2S 2619 26111 2611211711 documentation [5] 32114 120123 12118 Dram [1] 72114 Enforce [5] 7412 7417 7717 90111101117 1S2I17 1S2I21 dramatically [1] 7SI8 enforced [1] 11713 documented [1] 7SI6 drive [14] 148l11148l14148l19 148l2s engage [2] 7SI7138I2 documents [70] 30123 31l1s 38I1140I2S 14912 149114 1SOI111S118 1S119 1S3I1153I2 engaged [2] 134115 138ls 4113 4619 7013 81124 9SI12 95120 96121 1S313 1S31 8 1S31 9 engaging [1] 99122 97I11101I18102IS103I7103I10 10311110411 driven [1] 12SI24 enough [8] 34I11SOI2 so122 S9l23 67l18 10412 1041710418 104I2110SI610SI7106IS driver [2] 62l2s 72I1S 68I14124IS1S7I21 106112 107I11107I2S 109116 11012110124 driver's [13] 113112114110 11SI19116I4 ensure [2] 128l16 12914 llli1111I2111I4111IS111I1311SI1511SI23 11616116119 124119 124I2112SI1612SI17 enter [2] 1S7IS1S9I14 117l1s 118l19 118l2s 120120 120124121111 12SI21126I2 127114 entered [5] 13114 s8I219SI2S116I18 12511212711213018130/19131111131124 drivers [1] 124117 128116 132120 133121138116 139114140112 141110 drives [10] 10SIS146I19 147122147123 enterprise [1] 7019 141114143116 144IS 14SI1614SI20 14611 149IS149I11149I12 149I171SOI3 1SOIS enters [1] 411 149I16149I211S2120 1SSI71SSI9 1SSI13 drop [3] 4123 149I11SOI21 entertain [1] 6ls 1SSI13 16212 drum [1] 6418 entire [7] 1sl1120l16 21112 21112 2314 Dodge [2] 110110 110112 drunk [1] 72I1S 114119 1SOI21 does [30] 4122 714 719 211212219 22120 dry [1] 94121 entirely [6] 2111s 27IS S7l16 69115 71I1S 22124 2313 46124 47119 48118 S2l23 S9l10 DTPP [1] 63114 7917 6413 6sl20 66122 8417 88119 90116 12013 Duces [1] 9411 entities [13] 46l17 sol6 51I11S3I16 S714 122125 123110 12SI8 125110 137114146116 dude [1] 53119 59122 6114 89119 94115 97117 97119 97120 153111531215519 158125 due [5] 10918 113I2S116I1S116I2o 13912 10417 doesn't [53] 9112 17124 21113 2612 26ls during [6] 18l17 96119 10219 13012214717 entitled [18] 91211012410124 2911s 46l19 26I113SI1S 3717 41117 43118 4512 46122 1S811S 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11116 121612114 easy [1] 153115 et [1] 147117 1211814111171101911219116 2012 2014 editorial [2] 93l2o 144120 evaluate [2] 16123 7217 20121 23119 2411 26111 26l23 29122 3013 effect [1] 4216 evaluated [1] 6318 3013 31123 33116 3312134125 3519 35123 effective [1] 134112 even [35] 7114 917101121113 20122 2118 37117 40112 40122 4117 43113 44117 44123 effort [1] 144124 2517 2SI10 2SI10 26110 39119 46122 S1l13 44l2s 49125 so122 s3121s4l8 ssl13 s8l16 efforts [2] 138ls 138l6 51115 52/17 57113 5914 5917 6218 62113 6415 6ol18 62111 62113 62114 6sl1 6sls 6sl18 egregious [1] 12118 6614 66125 71122 8ol6 87l16 9519109114 67116717 6718 7113 71110 7218 74IS 77116 eight [1] 96113 llll21llll23 11611143115 145111149123 8sl23 8613 8614 86ls 861218717 87l13 either [6] 7122 32l2s 38119 40110 12617 1SOI1S 87l13 88l18 89l6 9017 90117 91115 92119 13814 event [1] 85l22 9619 99I5100I14101I1101I4101I25109I11 El [1] 73118 eventually [2] 3SI1o 6719 11213 112122 11417 11SI7 115112 115118 115124 electronic [2] 4113 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1060 s2/22 66/n 66/n 67/24 78/s 92/13 95/25 finishing [1] 41/16 E 99/22 104/1s 109/23 ns/7 nsj12 n7 j2o firm [4] 97/19 153/17154/6 158/4 every•.• [11] 121/16 133/2 133/3 133/23 121/12 121/14 129/17 134/15 first [52] 4/5 6/5 6/10 6/10 6/1619/719/23 134/24 135/1135/7 144/23 144/25 148/18 factor [1] 157/19 21/4 21/ll21/ll22/20 23/123/2 23/8 23/13 157/9 factors [2] ll/4ll/5 24/14 24/19 24/23 39/13 39/15 47/4 48/24 everybody [4] 34/3 132/5 144!21162/2 facts [1o] 48/16 52/23 55/14 67/167/2 55/13 56/23 77/15 78/12 8o/6 8o/15 82/6 everyone [3] 45/1 71/4 134/10 73/10 73/12 96/19 96/23 135/17 82/8 82/10 82/14 98/17101/13 101/15 105/23 everything [11] 44/23 46/11 53/10 56/8 factual [2] 64/17 65/2 107/18 112/24113/3 114!6116/11118/9 57/5 64/6 91/3 91/3102/14115/17117/11 failed [3] 63/19 79/7 79/8 118/19 123/1123/13 127/9 131/1150/10 evidence [71] 7/14 8/3 9/20 9/2110/2 failure [2] 90/14 90/18 150/16 159/16 161/6161/6 10/1811/1411/2414/2017/1018/1319/12 failures [1] 90/13 first-hand [1] 55/13 21/5 26/25 27/1127/12 27/19 27/20 29/24 fair [7] 15/8 33/5 57/18 57/19 59/23144/25 firsthand [4] 55/21 55/25 56/15f'/1 30/2 30/3 30/19 30/20 30/22 31/5 31/7 32/7 145/15 fish [1] 158/24 37/16 37/19 39/139/20 41/19 43/18 43/20 fairly [2] 33/7102/7 fishing [4] 97/24 98/1118/3 118/s 45/13 46/19 54/22 ss/23 s6/s s6/7 56/22 faith [4] 22/14 60/2 78/20 144/24 fit [2] 64/9 75/2 s6/24 57/25 67/2 71!24 73/24 82/6 82/7 fall [2] 25/20 94/17 fits [2] 19/13 19/18 82/18 86/8 94/14102/19106/24107/4109/5 false [4] 16/14 47/16 8o/8 98/16 five [7] 74/16 96/11101/5101/5114/19116/2 114/2115/2117/18118/22119/12119/15 familiar [1] 140/25 136/17 119/21119/22 125/13 129/15 129/17135/9 fan [1] 72/10 fix [1] 78/1 136/4 138/11 147/10 163/7 Fannin [1] 2/4 flat [2] 53/2 54/15 evidencing [2] 130/9 130/20 far [15] 7/1411/123/16 37/3 67/3 69/15 flattest [2] 53/2 54/15 exact [2] 105/22 113/25 69/25 90/192/18 116/24117/20 134/21 flier [5] 81/10 81/17 81/19 81j2186j2o exactly [13] 26/24 6s/s 70!11 73/5 82/15 142/16157/8 160/22 fliers [11] 79/22 80/17 81/8 82/6 82/8 84/2 86/1195/6 99/7123/22124/2124/4 fashion [2] 7/23 7/23 82/19 83/6 83/7 83/14 85/2 88/4 124/19 faulty [1] 21/18 flip [1] 6/15 examine [1] 122j18 Fax [5] 2/6 2/14 2/22 3/6 3/13 flipped [4] 27/10 27/12 27/19 27j21 example [5] 67/16 72/14 96/17109/4143/3 February [1] 33/9 flips [1] 21/4 examples [1] 144/2 federal [4] 30/22 71/8 73/8132/6 floor [2] 2/13 33/12 Excel [1] 148/18 fee [7] 31/7 31/16 31/2132/2 32/6 32/14 flyer [1] 81j11 except [8] 5/23 20/10 44/1 60/10 64/13 32/15 folk's [1] 140/8 75/23 119/3 137/10 feel [2] 8/7154/5 folks [21] 61/14 61/16 61/19 62/1164/7 64/9 exception [1] 147/3 feeling [2] 25/16 125/20 64/18 6s/8 68/18 69!21 93/6 96/15 97/18 excerpts [1] 59/2 fees [12] 8/3 8/17 8/17 9/23 10/10 10/10 105/ll107/2116/S117/6142/4143/18149/9 exchange [2] 30/12 31/14 15!17 31!10 31!18 34/7 8s/s 152/1s 156/15 excuse [4] 70/23 73/20 103/17118/23 Felix [1] 150/11 folks' [1] 106j21 excused [1] 63/9 few [7] 16j2o 41/13 74/22 77/18 93/1109/23 followed [1] 67/18 exemplar [1] 16/2o 124/2 following [3] 1/17 84/25 113/6 exemplars [2] 35/5 35/6 Fiance [1] 4/2 follows [1] 47/3 exercise [3] 63j2o 127/9127/11 fiduciary [1] 4/24 Foor [1] 163j21 exercised [1] 90/7 field [1] 38/21 foot [1] 14/11 exhibit [11] 12/13 54/3 118/10 118/13 118/17 fields [1] 77 j2o forced [1] 6o/8 130/25131/4131/5139/4139/6139/7 Fifth [1] 103/24 Ford [2] 57/19109/17 exhibits [4] 59/183/16118/11163/12 fight [2] 68/9 91/3 foregoing [2] 106/16 163/6 exist [2] 51/15 71/3 figure [5] 93/12 119/19 124/5 124/21149/24 foreseeable [1] 73/19 existing [4] 116/13 122/21122/23 149/25 filched [3] 22/4 23/9 23/12 forget [1]. 46/16 exists [1] 125/12 file [6] 8/7 40/1158/17 91/4101/1140/22 forgot [1] 161/4 expand [3] 23/6 132/8 144/22 filed [25] s/9 S/115/16 s/17 5/19 s/20 5/21 form [3] 18/7 30/4 39/7 expanded [2]. 20/15 104/25 44/lo 45/25 58/13 6o/8 74/16 93!16 93/19 format [1] 39/7 expanding [1] 144/16 96/24 97/18 101/25 102/4108/3 113/23 formed [1] 104/5 expansion [1] 134/3 138/17138/18148/15149/18157/19 former [5] 63/25 82/18 134/14135/19 expect [3] 21/9 106/15 n6/3 files [6] 16j1l17/16 39/18 40/2141/4 42/1 135/25 expedition [2] 97/24 98/1 filing [4] 90/10 98/11108/15161/6 forth [5] 6/15 24/24 25/8 42/2157/6 expense [1] 43/5 filings [1] 51/10 fortunately [1] 84/18 expert [6] 12/114/7 25/1 25/2 36/15 43/10 filled [1] 113/5 forward [8] 6/9 24/4 71/24 75/5102/8 experts [2] 29/15 157/21 filling [1] 64/13 102/18 128/24132/15 Expiration [1] 163/22 finalized [1] 18/10 fought [2] so/10 8s/4 explain [4] 77/19142/8142/19143/9 finally [3] 10/12 76/11115/17 found [18] 41/12 49/16 54/1 61j2o 70/6 explained [4] 68/21 78/s 83/10 118/23 FINANCE [34] 1/9 1/9 1/10 4/3 45/8 46/3 77/17 98/13 99/6 99/6114/3125/11134/17 explanation [2] 8/15 64/20 47/2 47/5 47/23 48/9 48/10 48/25 51/4 135/12135/17 148/19 148/25149/20 150/7 exploding [1] 144/19 51/22 51/24 53/3 53/4 53/6 53/9 53/18 54/19 four [23] 6/6 52/24 93/10 93/11102/24 explore [2] 46/10 46/12 54/23 54/23 55/4 55/6 55/8 55/9 56/10 103/10 104/4 104/13 108/7 114/13 116/2 expressed [1] 6/21 59/18 59/20 59/21 79/19 89/17104/8 121/4121/6121/7139/15140/4142/4143/18 extend [2] 4/21129/12 Finance's [1] 51/23 147/5156/10158/16158/18160/22 extensive [2] 128/10 132/4 financial [5] 1/51/612/1513/25 47/17 four-for-one [1] 93/10 extent [9] 18/25 23j22 41/25 92/14108/12 find [21] 9/3 34/142/1 53/22 63/19 68/7 frame [4] 32/22 111/22 128/15 129/7 110/15 119/9 140/11142/10 93/18 94/13 94/24 95/5 99/5 125/15126/7 frankly [1] 100/12 extra [1] 161/11 127/15 135/18 135/20135/25136/8 136/11 FRENCH [2] 2/12 2/19 extraordi~~,Y [~~- 153;75 148/13148/16 frequent [1] 108/8 extremelv 2 io. 2 ,·;;a•1o finding [1] 106/3 frequently [1] 38/21 F fine [7] n/s 32/12 32/22 33/2o 42/15 89j2o Friday [3] 90j12 92/3 148/s 100/20 friends [1] 72/11 face [5] 35/12 66/17 66/20 84/22 149/23 finger [1] 132/19 front [1o] 6/10 21/23 53/2159/24 74/25 fact [23] 7/22 22/3 26/5 39/151/12 51/14 finish [1] 34/6 86/7 91/24 98/17129/25 152/3

1061 35/18 39/17 40/9 40/20 41/14 43/12 so/18 half [1] 156/11 F 57/23 57/24 57/25 59/10 63/21 68/6 71/13 Halloween [1] 93/19 fruitful [1] 35/24 74/4 75/11 79/18 82/9 83/10 91/12 92/13 hampered [1] 78/s frustrated [3] 8/25 43/20 92/2 92/20 94/13 95/22 97/4102/15106/9106/20 Hancock [1] 16oj25 frustrating [1] 44/21 111/5115/22117/4119/3120/15120/18121/2 hand [4] 27/7 55/13 135/14 139/3 frustration [1] 92/1 121/4 124/3 124/13 124/14 125/14 126/7 handed [5] 12/2416/1112/23 123/23 full [6] 6/21 64/20 68/20 79/20111/21 126/17127/9 135/24137/11138/23 139/24 135/20 129/22 141/4141/4141/5142/16143/5151/25153/17 handful [4] 92j2 94/'5 96/s 96/8 FUNDING [4] 1/7113/19 123/9 124/7 155/12 157/13 handing [1] 81/24 funds [1] 41/12 goals [2] 138/6142/14 handout [4] 114/6 118/8 118/15 132/17 further [9] 11/10 21/2 46/1147/18 89/17 GOEBELSMANN [2] 2/18 4/9 hands [4] 56/1157/5108/1108/10 120/23 141/14 163/11163/14 goes [14] 18/6 21j1 21/8 35/2 39/2 56/3 happen [2] 57/9111/16 future'r2l' •i/2 !>81I2 56/23 75/Is 75/16 8s/9 102!19 156/3 '57/Io happened [6] 84/17 89/6 109/14116/I 157/11 117/22153/15 G going [166] happening [1] 48/16 GA[1] 2/10 gone [2] 67/3 152/16 happens [71 6/9 34/14 49/23 53/16 56/8 game [2] 5/7 49/21 good [8] 22/14 33/6 33/22 59/13 60/2 91/14113/25 gamesmanship [1] 152/2 60/21135/4 144/24 happy [6] 74/22 89/IO 89/11121/4131/20 GANNAWAY [54] 3/3 4/16 4/1712/17 good-faith [1] 144/24 161/10 15/2516/1517/1317/2417/2518/1919/4 goodness [1] 18/1 harassing [1] 39/22 34/25 36/12 39/17 44/4 46/2 54/13 70/6 Google [1] 153/8 harassment [1] S0/3 73/9 75/176/1176/24 81/25 82/4 82/21 goose [1] 24/15 hard [26] 23/810S/SI36/2146/I9147/22 83/18 86/14 88/9 89/16 90/14 91/14 94/19 Gordon [3] 67/21113/14113/16 147/23148/11148/14148/18148/24149/1 95/7 99/4103/9 105/9 106/4108/22 109/2 Gordon's [1] 69/8 149/5 149/11149/12149/14149/17150/3 111/1112/11119/9120/16121/2127/5128/4 gosh [3] 55/15 71/19 75/21 150/5150/11151/8 151/8 153/1153/2 153/3 135/14136/4150/8150/25153/14154/3 got [45] 4/2212/18 13/10 14/1416/3 16/7 153/7153/9 160/13 161/14 16/2417/2217/23 23/5 25/12 26/9 27/9 harm [19] 61/8 62/4 65/23 65/25 65/25 Gannaway's [5] 46/15 84/15 85/16 12o/16 27/2131/132/23 34/24 35/135/4 36/141/18 66/6 66/15 66/17 66/22 67/7 67/10 68/18 120/21 49/2153/1157/8 s8/7 68/3 68/4 68/8 68!12 69/7 69/16 69/23 70/172/172/25 72/25 Garcia [5] 4/215/3 5/4 73/17160/25 75/20 79/13 80/12 82/12 82/13 90/7 98/12 harmed [2] 37/20 69/6 Gates [1] 59/10 109/21110/11113/9 119/13 122/5 135/3 harming [1] 157/11 gave [12] 7/216/20 68/20 69/8 70/11 75/7 150/11152/6158/6 HARRIS [5] I/81/19 163/2 163/5163/20 77/12 77/12 78/12 82/10109/4129/18 gotten [5] 95/4 104/11104/2o 115/15 138/15 has [106] 5/16 S/177/Io 7/22 8/119/411/2 gee [1] 71/1 Grajeda [1] 149/6 11/1511/1813/513/2017/1717/2017/22 general [17] 8/5 8/I2I0/6I4/314/I7 47/2 grant [5] 73/22158/7158/20159/11159/15 24/20 26/22 27/127/20 35/16 36/137/11 47/5 47/9 47/'7 48/148!3 49/2 s8/9 94/4 granting [1] 100j16 38/17 38/24 39/20 40/142/20 44/5 45/14 141/19 143/11145/17 great [1] 13/6 45/22 46/2 46/3 46/9 47/20 50/13 50/25 generally [1] 31/3 GREENBERG [1] 3/10 51/22 52/8 52/8 52/15 53/4 53/6 53/6 53/19 generate [3] 93/7 97/10 98/7 groan [1] 159/17 56/10 56/24 s7/s 59/8 s9/8 59/12 63/24 generated [3] 78/3 83/13 108/3 ground [1] 6j2o 64/12 65/7 65/12 69/13 69/14 70/9 71/13 gentleman [3] 109/4 109/10 123/23 grunt [1] 159/17 71/23 74/25 75/9 76/8 77/7 78/9 78/10 78/11 GEOFF [8] 3/3 4/1717/2417/25 70/1182/2 gtlaw.com [1] 3/13 78/22 87/20 89/4 89/24 94/9 96/18 96/18 94/19 94/21 guess [9] 5/22 11j1o 24/11 68/8 68/Io 74/9 96/22 97/2 97/3 97/10 99/199/4 99/19 Geoff's [1] 69/3 97/19151/18 161/25 105/24106/6107/5107/14108/1108/1 geographic [1] 133/21 guessed [1] 124/20 108/14108/15113/4113/5116/24117/3 Georgia [13] 2/13 82/182/182/2 82/13 guessing [1] 17/IS 117/21121/1123/24131/13 132/5134/21 84/12 84/14 85/13 86/4 92/5 92/6 97/19 Guru [3] 93/13 96/18 96/25 135/11137/9142/3 144/4149/13150/23 156/s gut [1] 125/20 154/6157/17157/18 get [52] 4/6 6/12 I0/22 IS/19 18j10 18j12 guy [22] 46/8 46/18 48/19 49/3 51/24 53/19 hasn't [2] 62/24 156/14 '9/3 21!8 21!8 24!12 28/2s 35/23 38/s 4'/'4 53/22 54/24 54/25 54/25 ss/11s6/4 s6/8 hate [1] 115j16 46/1152/12 55/10 55/23 57/25 59/6 59/7 56/12 57/2 57/Is 57j2o 58/16 58/17 s9/2o have [415] 59/10 64/8 66/4 66/18 77/18 90/9 91/21 153/17154/6 haven't [22] 18/4 37/19 41/20 43/2 51/1 94/19 97/2199/8 104/8 111/13 115/23 119/3 >mvs-i4i' 2~/20 47/611oi16r<"/" 52/10 53/14 69/25 8oj2o 97/16 102j6 120/19 121/8 122/1124/18 126/11132/18 104/20 105/5 113/10115/11115/14115/14 132/19 135/20 137/2 138/1144/17150/3 H 132/25133/14 133/19142/6 149/17 150/5 152/11160/16161/11162/2 habeas [1] 159/23 having [8] 29/12 30/1130/12 43/20 59/2 gets [3] 40/22 158/1158/17 had [82] 4/23 4/24 6/19 6/20 6j22 6j22 63/9 68/13 111/19 getting [11] 7/1019/155/1155/16 63/10 8/8 8/14 8/2313/1616/13 19/1119/22 19/23 he [93] 4/22 4/2413/19 17/13 17/1417/15 91/4 91/17 92/21112/7121/11157/23 20/4 20/5 20/6 20/6 20/16 21/22 22/15 23/6 17/1717/2217/24 22/2 22/2 30/14 35/15 Ggannaway [1] 3/7 24/6 25/14 33/18 33/23 41/3 42/25 49/8 35/16 40/20 46/8 46/16 46/17 47/23 49/3 Gilstrap [1] 159/24 so!2o ss/25 58/19 6o/I65/7 66/7 68/8 50/4 50/4 50/7 50/19 50/2152/8 53/15 give [30] 10/713/12 16/11 21/14 30/3 30/3 68/19 68/24 70/5 70/14 71/171/13 71/16 75/1 53/Is 53/19 55!22 55/25 56/5 57/3 57/s 30/8 41/24 60/14 61/172/14 90/14109/3 78/7 78/9 81/2s 82/25 8s/6 88!21 88!22 57!22 58/16 58/2o 59/4 59/8 59/9 59/11 112/5 115/22 134/9 134/19 136/18 138/17 89/8 89/18 92/24103/17103/20 104/5 104/6 70/12 70/12 71/1171/13 71/15 71/23 75/2 75/2 141/5143/2144/2149/2149/4151/3151/9 105/25 109/6 109/12 110/9118/23 121/10 76/9 83/3 83/4 84/4 84/16 84/2o 85/3 85/17 151/11151/23152/4158/21 121/10122/4128/14132/16134/14135/23 87/25 88/9 88/1188/12 89/4 89/11 90/15 given [9] 44/7 62/24 74/15 8oj11 81/24 139/7 142/17148/1148/8 148/15 148/17 90/16 91/10 99/7 99/22 103/20 103/20 87/8 104/12 151/3 152/16 149/11150/14152/11152/13 161/7161/24 103/22 103/23 108/14108/14108/15 109/6 gives [2] 98/3 158/12 hadn't [3] 70/5 73/2 96/25 109/6109/12110/2114/4114/6116/18 giving [2] 63/23 157/21 Haegen [1] 40/7 123/25 135/8 136/23 148/12 148/21150/10 glad [1] 30/8 hair [1] 41/14 150/20 150/23 153/14153/15 161/5 go [69] 6/I47/2I8/2412/I713/2I4/15 Hale [4] 148/9 148/21149/14 150/19 he's [40] 17/1817/2217/23 19j22 24/22 16/1117/1618/13 22/2123/16 32/16 34/17 Hale's [2] 149/1151/22 39/12 40/17 46/16 46/18 46/18 48/10 48/19

1062 HOLDINGS [1] I/9 impermissible [1] n8/I H hole [1] 94/22 implicated [1] 135/10 he's ••• [28] 48/19 48/20 48/2148/21 50/15 home [3] 68/5 68/7 70/n important [4] 58/20 126/8 137/3 143/21 s•/•s2/s 53/22 53/22 56/4 57/10 58/17 Homes [1] 150/5 importantly [1] n6j12 70/13 70/13 71/171/2174/2174/25 76/20 honestly [2] 35/15 43/ll impossible [1] 26/22 85/17 85/18 85/25 99/24100/2 120/16 Honor [476] impressed [1] 161/21 120/22135/8 161/6 Honor's [12] 23/16 30/17 50j10 78/180/3 improper [5] 47/I4I07/5125/I8I27/10 heading [1] ll4/6 84/22 Bs/17 91/5 92/1151/13 156/6159/5 132/6 heads [1] H?/5 Honorable [1] I/19 improperly [1] 69/13 hear [5] 8/24 88/9 108/23 135/21135/25 hope [1] 34/23 inapplicable [1] 69/15 heard [14] 20/24 28/IO 28/12 29/12 47/6 hopefully [1] 93/ll inappropriate [4] 43/ll43/I4 66/14152/5 50/7 61j15 95/196/25 108j22 109/6 ns/3 hot [1] 158/17 INC [5] I/9 1j1o I/10 79/20 79/20 141/19 159/17 hours [1] 161/25 incentive [1] 138/2 hearing [24] I/14 6/Io 8j2218/18 21j23 Houston [7] I/19 2/5 3/5 3/12 72/ll92/4 inclined [1] 158/7 25/24 26/24 36j2 49/8 49/15 50j2o 6o/8 163/21 include [10] 8/10 20j16 20j17 25/14 25/17 79/12 82/25 84/17 88/2 89/5 89/15 92/25 how [44] 9/23 9/2510/2314/416/1217/2 62/8 106/I4lll/2 129/5144/23 100/25105/4107/15ll0/2162/3 28/1 28/n 28j19 29j12 30j19 31/5 32/6 included [1] 163/8 hearings [4] 25/7 85/6 89/8 105/13 37/24 5•/•6 53/2156/15 56/18 63/23 67/17 includes [3] 29/16128/16129/10 Heatller [1] ll4/I8 86/16 95/16 96/10 98/6100/5 109/ll109/21 including [6] 7/12 96/6 131/12139/17 heavy [1] 51/1 ll0/17ll2/12 ll4/5 ll5/25 122/25 123/10 141/10 153/4 held [2] I/18 I/19 124/7126/1132/23 136/7 136/12 146/1153/13 incomplete [1] 20/25 help [3] 126/13 141/20141/21 154/9155/14157/18 158/1 Incorporated [1] 96/18 helpful [1] 157/23 however [4] 5/25 29/15 89/18 ll5/2I incorrect [3] 27/2 72/8121/9 her [22] 51/13 51/13 SI/14 109/24 noj24 huh [1] 81/16 incorrectly [1] 17/5 lll/2 lll/7lll/14lll/IS ll5/I6 n6/I3 121/9 hurl~!~ 6~~~1 increase [1] 129/7 121/19121/19 122/19 126/21128/8 129/25 hurt 1 6o 11 incremental [1] 7/21 I31/23147/6•47/7•6of•6 1 incur [1] 121/to here [105] 4/19 6/15 12/712/23 13/23 13/24 incurred [1] 32/9 I4/I6I5/HI8/I2 21/3 21/5 23j2o 23/22 I'd [3] 42/22 70/17159/23 independent [1] 43/22 25/13 25/25 25/25 26/126/2129/20 31/2 I'll (4] 6/13 73/In8/I8132/19 indicate [1] 155/9 32/24 36/24 38/23 39/10 43/24 45/24 46/25 I'm [83] 10/1712/6 12/13 12/1412/20 15/25 indicated [6] 8/15 14/5 40/I 74/IS ll4/8 48/20 49/5 50/10 51/17 51/24 52/14 52/14 16/516/16 17/19 22/23 23/7 23/2126/15 38/I 145/20 53/2 54/14 54/25 57/IS 62/24 63/18 64/18 38/23 42/3 43/3 43/24 44/19 53/18 53/20 indicates [2] 108/24 152j22 68/16 68/17 68/24 69/14 69/17 70/171/2 54!2o 54/24 55/2 56/2 57/8 s?/8 s?/•3 indicating [1] 8j16 71/10 71/20 72/8 72/19 72/20 74/9 74/10 s8/I2 64/16 69/2s 7o/6 7•/n 72/1o 73/22 indication [4] 123/19 124/17133/5 156/18 74/22 78/21 82/3 83/10 84/13 84/20 84/22 79/6 79/17 81/21 85/13 88/9 91/2 91/6 91/8 indicative [1] 112j12 85/5 85/10 87/19o/6 90/8 90/I9 9I/7 95/'3 91/17 92j2 92/14 93/12 93/18 98/5102/13 individual [15] n/2 19/2 24/19 48/13 96/3 97/16 99/16 99/22 101/7102/13 102/14 102j23 ll4/I5 n9/8 ll9/2II23/5 124/S 50/23 99/16 99/17 99/18 101/23 103/19ll0/9 noj2o n3/8 n5/24 n6/17n8/3 n8/5 H9/7 125/23 130/13 130/15 130/23 131/6 131/8 ll0/20 ll7/25121/lll29/22 124/17126/19 126/24128/6 128/25129/24 132/18137/6138/13140/7140/25144/ll individuals [19] 22/17 29/17 35/7 40/9 132!19 '35/s '35/•8 •4•/•8 146/3 146/s 144/20148/4149/3152/3153/17154/2 59/2 68/4 81j2o 88/7105/2 105/Slll/19 154/3 156/24158/10 158/l1158/15 158/17 156/13158/25159/4159/5160/14160/16 lll/20 ll2/4ll9/lll29/6130/lll3I/23 159/22160/3 161/5 161/2 161/20 161/23 139/16 142/7 here's [5] SI/8 55/12 55/12 72/23 96/17 I've [22] 9/2412/18 12/24 21/22 46/s so/13 Industrial [1] s8/I4 hereby [1] 163/5 S0/14 s8/I7 62/6 62j23 63j22 74/10 74/16 industry [4] 56/9 56/13 s6/I7 75/21 Hernandez [1] 103/19 78/5 81!24 87/15 89/8 95/1128/?•so/• inevitably [1] 31/17 hey [7] 10/214/4 30/15 40/20 55/13135/15 153/1158/6 infancy [1] 75/15 135/20 Ida (1] ll4/I8 infinitesimal [1] 136/9 hide [1] 145/2 idea [4] 41/24 59/13 I36/I4 156j23 information [142] 8/2 8/2012/412/7 higher [3] 101/19 104/9 136/1 identical [2] 36/20 82j16 12/15 13/15 13/16 13/21 13/24 14/8 14/ll higher-level [1] 104/9 identifiable [1] 39/14 14/1214/13 14/2114/2415/115/7 15/715/18 highjacked [1] 29/6 identification [1] 104/24 I5/I8I7/3I8/6I8/9I8/9 2ojn2o/14 2oj16 him (36] 28/IO 30/15 30/15 33/16 35/17 identified [1o] 78/13 78/13 8oj2 96/18 20/17 20/21 21/1 21/9 24/124/21 25/2 25/18 35/18 46/16 soj2 so/8 50/H5I/I2 52/6 52!7 96/22 99/17 99/19 104/14 132/21132/24 27/21 31/16 31/2132/2 32/15 36/19 37/5 53/22 53/24 55/2 55/22 65/19 65/19 68/9 identifies [1] 23/25 37/•o 37/13 37/Is 37/'7 38/2 38/5 39/n 68/10 68/12 76/17 85/18 90/14 94/20 103/23 identify [24] 4/517/518/12 23/7 23/8 39/23 40/15 41/18 43/4 43/5 43/8 43/9 106/5 108j13 H4/3 n6/I7l16/I9 n6/I9 24!23 40/I3 72j21 79/'9 79/25 8o/s 83/n 44/14 47/14 49/25 50/2 50/22 52/9 52/15 144/22148/22160/5 86/16 87/2 88/3 88/6 88/8 94/10 105/2 53/13 54/18 56/25 6o/3 6o/6 6o/7 63/3 63/4 hired [1] 35/16 n6/I3 132j2o 133/21134/7134/8 63/10 63/IS 63/20 64/25 67/12 68/9 68/14 his [36] 17/17 24j22 46/9 46/10 46/15 50/15 identifying [3] 83/24136/2 137/10 69/5 69/8 69/20 70/10 73/13 76/6 76/8 80/4 55/'9 56/n56/14 57/2 57/2 57/5 70!16 71/I identity [4] 22/9 22j16 40/4132/23 85/8 9'/'7 91j22 94/7 96/6 97!12 104/8 71/ll 71/ll 71/20 84/20 84/22100/6 107/15 if evidence [1] 43/18 104/12 104/16104/17105/1105/16 106/17 107/I7I08/II08/I4 ll3/24 n6/I5 n6ji8 ignorance [3] 70/23 71/5 159/I 106j18106j20 107/I8I08/I3 lll/17lll/24 u6j2o 123j24 124j2 130j22 148/15 150/n ignore [1] 59/I l12/6n2/7H3/I9H5/6n9/2ll9/4ll9/6 153/17153/17156/15 illegal [20] 25/10 26/3 40/19 47/6 68/19 l19/8 120!5 I20/I3 120j23 121j3 122j17 history [2] 63/13 134/4 70/14 70/17 71/2 71/16 97/6 98/18 100/10 122/20 123/10 124/6125/22 126/UI26/I2 hit [1] 94/21 104/5 lll/7l12/25 n3j2o n8/II33/I3 135/4 126/17 127/1127/7127/15 127/18 128/7 hold [19] nj2o 13/17 23/19 34/6 35/3 36/16 135/15 133/25 134/19 135/14136/21137/24137/25 36/16 40/24 63/13 65/17 67/6 67/6 75/24 imaged [1] 36/23 142/6142/23147/17149/24150/6 157/6 101/14121/21130/13132/4132/23 140/1 immune [1] 62/9 infringement [1] 59/n holder [4] 108/llll3/I8 123/8 150/13 impact [1] 94/22 initial [5] 6/24 7/23 9/I 9/IO 161/9 holders [3] 98/14109/24 120/I impacts [1] 68/23 initially [1] 22j10 holding [2] 45/ll IOI/16 impeach [1] 43/10 Injunction [10] 95/25 98/19 102/3 102/22

1063 132/16138/12140/4141/19147/23148/3 June 15th [2] 159/25160/18 I 149/1149/19 151/8 151/9 151/10 June 2013 [3] 103/2117/1132/22 Injunction ••• [6] 103/1108/6 113/1113/21 issued [4] 32/20 42/22 93/16 104/25 ~urisdiction [1] 62/9 117/5 118/2 issues [14] 5/1412/19 21/3 41/1142/9 44/24 ~ury [16] 15/317/9 53/18 53/2154/20 55/11 ink [2] 16/21 35/11 49/22 77/6 92/23 93/17 97/10 97/23104/23 55/24 56/2 63/19 64/17 65/18 66/23 69/19 inquired [3] 83/17 83/18 84/1 148/18 84/12 84/13 138/1 inquiry [1] 157/8 it [410] ~ust [112] 4/4 4/23 6/14 9/2410/3 10/14 instance [8] 59/14 61/17 78/12 117/15 119/17 It'll [1] 132/18 11/8 11/20 13/1713/23 14/13 14/19 15/4 15/16 122/25 136/16 143/2 it's [132] 7/9 8/23 10/9 10/9 10/10 11/6 14/3 15/19 16/117/13 18/2 21/22 25/24 26/126/20 instances [4] 77/24 109/24 111j11111j11 14/5 15/8 18/8 18/8 19/18 19/25 20/22 28/1 29/20 31/13 32/19 34/3 35/7 35/9 35/25 instructed [1] 8oj15 28/15 35/19 35/24 37/16 37/2139/22 39/24 38/6 39/14 40/22 40/24 43/4 43/6 45/1 instruction [1] 78/7 41/3 41/22 41/22 44/15 44/15 44/15 44/17 47/16 50/7 51/25 52/2 55/7 57/16 6oj18 instructive [1] 75/13 44/18 44/20 45/2 46/22 49/151/16 53/8 61/15 64/17 65/10 65/16 65/2166/17 67/21 instrumental [1] So/ 4 53/25 54/154/4 54/6 54/8 54/22 55/2 55/6 68/17 70/11 70/17 73/16 74/15 75/24 76/1 insurance [3] 64/23 64/25 65/1 55/B 55/23 56/17 58/8 58/9 58/22 59/14 79/17 82/19 84/19 87/2 87/3 87/14 89/12 insurers [1] 64/25 59/15 59/17 60/20 60/20 63/172/23 73/23 89/14 90/7 91j12 93/24 97/25 98/16 100/5 INTEGRITY [56] 1/7 95/5 98/14 99/7 74/20 75/12 75/24 76/7 78/10 79/11 82/7 101/14103/17105/7106/7106/20108/18 99/10 99/21105/21105/25 106/1106/3 82/16 86/12 86/23 86/25 87/2 90/12 90/12 111/7112/7112/20113/11116/1116/11116/23 106/9 108/11109/9 109/10109/12109/20 91!2 91/3 92j2192/22 94/23 95/1196/5 96/B 117/14117/22119/21123/1126/16126/21 109/24111/25113/19117/10117/19119/22 96/9 98/9 102/7106!4 106/5 107/1107!21 127/18128/12128/20129/4129/9129/17 119/22 120/1122/1122/9 122/16122/16 108/4109/9113/8113/11114/20115/19 130/6136/10 136/13 136/14136/24137/17 122/20 122/21123/9 123/15 123/21123/24 115/19116/23117/8119/4119/4119/19121/6 140/20 141/5142/16 143/2 151/21151/21 124/7124/14124/22124/23124/24125/4 121/13121/25123/14124/4128/4128/5 153/14157/5 159/8 160/16 125/6 132/3 141/12 141/15 142/13 143/13 129/12 130/1130/3 131/19134/12 134/21 Justice [1] 71/3 143/17148/13149/20 150/13 152/24154/19 136/9 139/1139/24140/19 142/9 142/22 r Jwar~o ii 2ii, 154/19 154!22154!23 155/8 144/20145/15146/11146/11149/3 150/7 intend [2] 14/24 100/19 150j12 151/16151/18153/6153/8156/4 K intent [1] 43/19 156/23 157/1 Karen [1] 114/17 interest [3] 8/1710/9 15/17 it's the [1] 8/23 keep [6] 27/24 31/23 38/17 39/12 90/4 interested [4] 83/9 84/5 120/8137/25 item [2] 15/2131/6 128/24 interesting [8] 8/13 31/17 49/13 49/14 items [11] 8/5 42/24 81/5 83/24 90/23 keeps [1] 134/10 49/23 53/25 100/25 150/25 126/14127/6138/19138/20138/22140/20 kept [2] 108j17 108j17 interfaces [2] 61/17 65/5 its [7] 7/23 39/7 44/5 47/20 47/2154/19 key [4] 21/3 39/9 81j18 142/5 interfered [6] 8/416/2217/617/2519/6 149/23 keys [1] 122/19 19/8 itselfftl q'/21 killed [1] 72/15 interference [1] 16/24 kills [1] 73/21 interject [2] 69/10 92/17 J kind [16] 13/15 13/1616/20 31/20 44/5 internally [1] 77/17 James [5] 131/2 131/6 131/13 131/14132/1 57/22 63/18 92/12 97/4106/15117/7121/13 International [1] 67/22 January [1] 158/6 133/8144/17144/18 156/18 interpreted [1] 91/19 'ive [1] 103/17 kinds [1] 35/8 Interrogatories [1] 18j22 'ob [2] 79/2188/3 knew [7] 6/25 55/24 55/25 56/2 57/22 Interrogatory [4] 18/23 84/9 87/16 88j16 Joe [3] 4/12 4/15 20/24 127/13 136/11 interrupt [1] 139/22 JOHN [1] 2/3 knock [1] 93/11 interrupting [2] 23j2o 114/22 JOHNSON [28] 2/3 4/7 4/8 4/20 15/14 knocking [1] 59/6 interruptions [1] 23/21 16/1616/18 23/5 28/3 29/12 30/16 37/3 74/4 know [134] 7/9 7/910/1110/2411/211/3 interview [1] 137/11 74/20 74/25 83/184/4 84/8 84/10 84/16 11/611/2013/515/1315/2019/4 20/2121/12 intuitively [1] 124j2o 90/14 95/10100/6135/23140/15 154/4 21/14 21j18 21j2121j25 23j12 23j21 24/5 invective [1] 66/25 160/11161/14 24/7 24/8 24/18 25/18 26/8 26/11 26/12 invectives [1] 65/21 JOSEPH [1] 2/10 26/23 29/14 29/15 30/2130/2134/17 35/6 investigate [5] 104/3 104/13 120/9 120/11 ozmer [1] 2/22 35/9 37/17 41/18 42/3 42/15 44/2147/16 126/18 'udge [22] 1/19 4/17/5 7/6 21/23 23/10 49/10 49/13 51!13 52!18 55/13 55/24 56/I investigated [1] 77/17 24/18 24/20 26/20 35/14 35/19 42/18 60/16 56/12 56/14 56!15 56/18 58/8 59/9 62!25 investigating [2] 111/7111/8 70/8 76/8 76/14101/9 156/15 156/25 157/8 64/19 65/17 66/3 68/25 71/4 72/8 74/19 investigation [1] 78/14 157/16 159/24 74/20 74/25 75/183/8 85/20 86/7 89/6 Investigations [1] 93/13 Judge's [1] 156/21 90/12 90/12 91/10 91/15 92/8 92/21 94/10 invoices [2] 31/10 32/19 JUDICIAL [2] 1j10 35/17 95/3 95/15 96/9 97/18100/14109/11110/17 involve [1] 139/15 July [12] 14/10 20/15 75/16 79/12 89/15 112/3 112/25 114/7115/7115/12 115/18 116/1 involved [14] 38/6 68/4 79/2180/1180/17 102/24 107/15108/3 109/7113/24 159/1 116/3116/7116/14117/1117/24118/13120/4 84/14 88/3 88/7 97/8104/4105/2117/18 159/2 122/25 123/10124/7124/16 125/5 125/19 134/8 152/2 July 17th [1] 102/24 125/22 129/17 131/25 133/10 133/11133/16 involvement [1] 111/7 July 18th [3] 79/12 89/15 107/15 134/11134/21135/1135/7135/22 136/1136/1 involving [2] 87/11141/2 July 23 [1] 109/7 136/18141/20141/22142/24144/14145/11 irrelevant [4] 10/20 37/5 93/8105/19 July 24th [1] 113/24 150/14150/20150/23151/17151/22154/4 is [sBsl ~uly/September [1] 75/16 154/6156/20156/24157/16159/19 is correct [1] 26/17 ump [1] 11j16 knowing [1] 117I 4 Ishmael [1] 103/19 umping [4] 8/23 14/2 22/7 66/23 knowledge [14] 53/13 53/19 55/14 55/21 isn't [to] 12j2o 30/2137/15 37/19 39/19 urn ping-off [1] 8/23 55/23 58j2o 5Bj2o 59/9 71/7 73/16 81!17 57/19 72/20 74/19123/19153/22 umps [1] 84/16 81/19 85/14104/9 issue [45] 6/4 6j22 7/910/1412/2313/1 June [20] 21/23 24/4 37/19103/2117/1 known [9] 27/13 68/19 70/14 70/17 71/1 13/3 16/616/8 18/19 33/135/2 35/12 36/24 132/22 158/8 158/9 158/12 158/20 159/2 71/13 71/16 71/19 88/25 42j2o 46/17 49/9 63j21 65/2 78/1178/13 159/11159/12159/16 159/16 159/17159/18 knows [9] 10/23 42/2150/19 56/13 59/11 78/13 82/25 93/193/9 98/10 102/23 103/23 159/25 160/2160/18 61/6 95/24 144!21156/5 105/3 112/24124/11126/14128/25 131/21 June 13th [1] 37/19

1064 lie [11 55125 loaner [11 8117 L lien [131 47114 98114105125 10811110919 loaner-related [11 8117 lady [11 109122 109111109112 109124 11011113118 12011 LOANMAX [11 116 lag [11 10913 12318 150113 loans [201 115 1l61l71l718l1918l2119l1 laid [11 10015 lienholder [11 10611 2417 2511125125 38114 38119 39119 39121 Lakers [11 72110 lienholders [11 10719 40116 40119 88125 109123 119123 122116 landing [11 2518 liens [51 9917 99110 103112109116 117119 LOANSTAR [361 115 116 20118 22110 2311 landscape [11 1314 lies [11 14413 24124 26113 26115 27110 27119 271212817 langnage [41 42120 6318 64124 68121 life [11 158l15 28116 291173815 3817 3817 38118 3914 3915 Lap [11 13413 light [11 63113 41113 41125 5311156112 72125 97120100121 large [11 66119 like [531 1115 1312114113 1514 20114 2519 100123 100124111125 141112 14211414317 last [321 5124 7112 18117 2418 24110 24113 3517 36110 3918 4311 431114417 45118 4718 143113 143117152124 2511135125 3713 3819 42120 42122 44122 53123 s8ls 63l8 6318 6412 6sl4 69112 7011 LoanStar's [21 124113 14111 5317 57110 74114 7719 82112 82113 91110 751118017 8411184116 8412188114 94123 locate [71 6415 6416 106l7126l5129l16 91119 92124 961199118 10119 10111110219 10217 102111106114 109118 114110 114112 12912014016 104119 11012 137123 147123 148122 114I21121I1121I7127I13130I2131I22133I11 located [41 131112 13518 13518 13818 late [21 90112 92121 135115135116 1361613713 14417145115 15119 locating [11 105116 later [61 2612 28l7 41113 87117113125 1531615318 154119154123 lock [21 87125 89l12 125125 likely [51 12711214211814311414811215011 log [41 sol16 sol16 90125 140121 lanndry [11 6315 likewise [11 36110 logic [11 96114 law [201 4617 49119 52124 5711457115 6ol4 limit [71 9711511213 12711127l5127l24 long [31 41l9113l4160l3 6613 68125 70116 70118 70120 70123 7114 1441114617 longer [31 1011214719 15613 7115 71113 71119 73117 991113216153117 limitations [31 4311 66119 151112 look [401 1619 16l16 3114 39118 4019 40121 · lawsuit [91 1511145114 4717 56125 5919 limited [121 3612173118 881219512 97116 41125 49112 5119 52123 52123 5419 64121 5911159122 6711414416 97123111122 126114126119 126120131112 64125 73117 82115 8418 92119 9419 95122 lawsuits [21 156l5 157119 133114 105123 109115 11015 112123 11312 11313 11415 lawyer [31 ssl6 5914 60111 limits [11 117I 4 117111122125 124111124113 127122128110 lawyers [21 s611 57114 Linda [21 51112 147I 4 1321113211138123 1391114315 149116 155111 lead [101 37l16136l2o 138110 158l11158l21 line [41 721117412510911511314 looked [131 59112 6819 75120 10216 102114 15919 16013 16016 160114160122 link [31 64113 64114 95118 105117109122 116117116119 148117148118 leads [11 125117 linkage [11 69l16 148125 152123 learn [11 99l2o linking [11 134122 looking [311 6l12 1212015125 25125 2611 least [91 81711171714 21117 2214 2217 links [11 11417 26115 3113 5319 8312 8316 8318 8611194118 64123 119120161123 list [1041 715 716 7122 8123 911919 9110 102113 10517110115 110117113111113116 leaving [11 11114 9I1110I711I111I111I22 11125 14110 15120 1141211611311611811711511711812418 led [21 63110 113120 1817181101811218115181221812419110 127111130113 131111391141401614111 left [31 4219 10117136113 191111912019123 19124 2018 20115 20I2o looks [31 3517 12117 130125 legal [211 53117 54119 61110 61114 6215 20125 2118 21112 21118 2219 22113 22115 Lopez [11 4017 62112 62l17 62124 6sl3 65112 66ls 7DI9 22116 22123 22124 23115 23125 24112413 Los [41 212172110 10118 158l14 70110 71112 951219612 9716 97114 9818 2413 2418 24112 24118 24122 2616 26123 loses [11 70112 10018 105114 29124 3018 30113 3513 35110 35113 35120 losing [11 161122 legislative [11 63113 351213711138125 39110 39110 39113 39124 loss [111 9125 1117 12115 13124 14l114l16 legitimate [21 54119 9819 4014 40114 4118 41117 6315 74111 74123 141211515 4314 4317 4319 legwork [11 13719 75110 75114 75122 7614 7619 76115 77110 losses [51 1012113111311214118 37118 lender [11 24119 77115 77125 7813 7817 78114 78117 91125 lost [201 6125 7117115 7119 7l2o 7123 8l16 lenders [11 109l18 105I1108I11117I1128I15 132111331313413 8117 8117 81171318 1319 131111413 14114 length [11 13912 13412414116 14411144116144117151116 15115 15117 21125 21125 26123 less [41 57l2o 98l1101l5137l18 151119153110156114156119 15711157121 lot [131 31112 40114 5917 63124 70121 78110 let [191 25l18 25119 36l16 4015 42123 57117 listed [61 61113 81120 142112 142115 150113 9616 103122 106112109116 13012143111 68125 91112 100117112114123118 12812 16116 143116 1311251401114519 151121151125154118 listen [11 136124 lots [31 47112 63124 64112 15918 lists [61 20119 30112 4ol8 81l2o 8513 Louisiana [11 3111 let's [141 3215 3416 46123 65l18 651217414 161113 love [11 15415 7611 92110 10117102110 12715 1321613915 lit [11 86124 LOVETT [121 319 4119 517 8113 9122 19115 145124 literally [51 17115 53114 961313412313515 2112o 48122 52119 5814116111160119 letter [241 4714 4715 47l1o 47125 48ls 4817 litigation [91 48117 97171031181261313411 low [21 80123 9514 48l2s 54122 54123 5518 s6l9 s6l19 s612o 156l6157l11157l15158l2 low-level [11 8ol23 56122 58l6 s9l1s 59116 s9121s9l24 6ol10 little [121 16l7 2512175111 76l186l24 90I8 LP [11 117 66112 8ol18 93113 13918 90110 104I11158I31S8I4158I5158I13 Lucia [11 14916 letterhead [41 48ls 49115319 59117 live [11 114119 llvin" r~i 16i"16 letters [201 51215122 612 5913 79121 85l1 living [21 19116 s8l17 8519 85l1185l13 8616 8814 9313 9314 93116 LLC [141 115 1l61l10 4519 4612 4613 4712 M 9415 9619 96115 10011413616 158110 4818 4819 48121491159115 8911710418 ma'am [31 65114 6912 7215 level [61 78115 8ol23 8119 83113 101119 LLP [31 214 2119 3110 machine [11 1121 10419 load [11 15317 made [3o1 2212 26ls 3111140110 41114112 liability [31 61123 6219 73120 loaded [11 65l2o 4113 421143125 4415 5119 51115 54113 54125 liable [31 6211 62112 62113 loan [471 914 9114 91171312 15l2116l6 1618 5514 5516 6513 68113 71123 86110 98112 license [261 47112 6818 9916 99110 99112 1819 18118 1912 2419 24111 24113 24114 98I23102I9104I3117I16119I1120I7128I7 9912110819 11015113113114110115119 11614 24123 24123 25112 25114 25114 2611 2616 150111156124 11616116119 124117124119124121125116 2618 2619 2619 261112816 38118 3914 3915 mail [61 217 2115 2122 317 3113 11211 125I17125I21126I2127I14129I2130I12 4012141l8 41113 41114 41l16 8318 85l2 mailer [11 6417 14211414312 10916 10918 11018 11019 110114113123 mailers [11 83114 lick [11 19112 113125116115117122117122122121 mails [11 142113

1065 97/25 100/5 100/17100/22 101/5102/11 money [1] 94(23 M 112(14113(6 115(2 115(24 116(9 116(11119(13 MONEYMAX [2] 1(5 1(7 maintain [2] 34/13 71(18 119/20119/20119/23123/4123/18127/17 monitoring [1] 47/11 maintained [1] 47(15 128/2129/25132/18137/1137/2137/15 Montalvo [3] 163(4 163(17163(18 majority [1] 66(19 138/17140/1141/3141/5 141/20 141/21 month [7] 10(12 37(19 57(10 82(12 82(13 make [40] 19(14 22(3 22(7 28(3 33(136(1 141/23 145/7148/16148/16148/21148/21 105/24 113/25 36/12 37/7 41/23 42/3 42/12 42/17 44/11 149/16 149/17151/20 154/14154/18 159/7 monthly [1] 13(25 44/23 48/13 48/15 52/10 53/2153/23 57/8 159/8 163/10 months [10] 7(1219(1219(16 25(10 25(10 57(2165/10 75/5 84(13 97(25 97(25106/5 MEADOWWOOD [1] 1/6 26/2 88(18 89(6156(11159(2 112(9118(18 120(14125(23126(13129(4 mean [18] 6/23 23(20 26(2 29(3 32(18 Moran [6] 113(14113(16 113(23 114(17124(1 140/10 144/20144/23 145/8 146/22 150/20 59/10 65/18 66/22 72/16 73/23 100/10 106/3 124/14 157/8 113/10115/9 120/2120/18 124/19 143/1 Moran's [1] 114(18 makes [4] 50(8 69(12 69(24129(14 meaning [1] 151(20 more [23] 6(12 8(5 8/5 49(14 64(20 76(21 making [14] 7/4 17(11 29(1153(10 54/23 means [8] 59/4 60(5 64(14 73(17 73(23 76/22 76/23 84/1185/12 90/10 92/23 106/19 57/10 57/1163/18 70/9 71/1120/8147/15 98(24 99(1113(12 106/22115/23116/4116/12117/14128/10 149/3 151/18 mediation [6] 32(15 33/3 33/7 34/9 34(20 145/8 148/24 151(8 156/3 manageable [2] 146(11146(12 157/23 moreover [1] 122/15 Management [1] 48(8 mediator [1] 33/23 morph [1] 7/5 manager [11] 48(2153(7 81(7 82(19 83(19 meet [10] 50(23 61/1168(17 71(14 71(22 most [5] 104(19 106(19 108(7121(8 145(3 84/2 132/20 132/23 133/3 134/24135/7 88/22138/6148/1148/3 149/11 Motion [78] 5(17 5(20 6(3 6/8 6(16 6(16 managers [7] 47(20 83(18 84(24133(23 meet-and-confer [4] 88(22 148(1148/3 7/25 8/18/810/110/3 10/1310/1411/911/10 137/17137/18 137/19 149/11 11/16 12/3 12/13 12/2012/2112/25 33/11 manner [1] 67(15 meeting [1] 21(22 42(9 43(16 44/9 44/1145/3 45/5 54/1 6o/8 mantras [1] 154(20 meets [1] 141(16 60/17 60/22 71/11 71/11 72/19 73/22 74/2 many [17] 13(6 32/6 42(21 71(14 72/9 75/3 member [2] 48(2153(6 74/7 75/1177/778/5 90/4 90(119o/12 91(3 77/24 96/10114/11126/5132/24135/19 mention [1] 58(10 91/20 93/5 93/17 93/18 93/20 94/4 96/16 135/24136/12154/9155/14157/18 mentioned [1] 14/2 96/24 100/13 100/15 101/15 101/18 101/22 marginally [1] 9/7 mere [1] 67(4 101/25 102/2 102/17108/2112/24118/12 marked [1] 131(9 merely [1] 37(6 118/18132(15137(23138/14138/15138/22 market [3] 104/5 131(17133(13 mess [1] 159/5 138/23 139/8 149/18 152/19 152/23 155/22 marketing [40] 47(11 66(10 79/4 79(25 message [4] 57(6147(5147(8147/10 155/24158/7 80(4 80(11 81(1 81(12 83(9 86(4 86(17 87(3 messages [7] 139(12 139(17141(10 141(13 MOTIONS [23] 1/14 5/9 5(115(14 5(16 5(17 87/9 87(1o 87(14 87(2188/5 88/8 88(24 146/21146/23 147/2 5(19 5(215(22 6/2 6/10 46/5 74(22 90(10 88(25 89(1104(10 111(8 118(1125(11128(25 messaging [1] 147(14 91/5 91/12 92/3 93/193/15 101/12101/21 130/11131/12 131/14140/25141/11141/15 met [4] 51/162(24150(4154(25 102/17 104/24 142/14143/6143/8143/20143/24144/4 method [1] 82/10 motor [4] 47(15 57(19109(17114/8 144/4 145/15 methodology [1] 138/8 mouth [1] 136(6 ' markets [2] 14(1 36(22 Michael [1] 81(7 move [6] 31/6 45/3 89(17 89(18 92(11 Marshall [1] 159(19 middle [7] 13(814(15 38(4 69(2186(12 152/11 Martinez [4] 134(16 163(4 163(17 163(18 113/2113/5 moved [3] 84(20 85(5 92(25 MARY [2] 3/9 4(19 might [30] 5(25 6/2 6/6 7/8 29(10 34/4 moving [6] 12(25 111(10 128(24 131(8131(9 MARY-OLGA [2] 3/9 4(19 41/1141(1141(12 58(23 62(9 64/3 65(1 132/15 Master [13] 7/7 7(13 20(20 25(2 30(2 30(11 68/24 69/193/6 95/23 97/13 97/18105/25 MR [51] 2/3 2(10 3/3 4/7 4(16 4(215(3 5/4 37/10 77/10 77/2178/8 78/18 91/25117/3 116/24120/16123/19 124/1124/21145/5 12(1715(1315(2516(1516/1616/1817/13 matched [1] 155(7 145/16 148/8 148/19 149/16 18/1919/4 21/22 23/5 23/19 27/14 28/2 material [1] 93/7 Mike [1] 134(16 29/12 30/15 33/25 36/25 44/4 49/2 50/24 materials [2] 70(4 88(25 million [1] 144(5 56(22 58/11 59/5 70(21 74(13 76(24 82(21 matter [20] 6/9 26(1127(5 28(1151(9 millions [1] 145(20 86/14 87/24 95/7 95/10100/8105/9109/2 55/14 57(13 57/14 57/15 58/23 70(15 70(18 mind [4] 10(22 39/13 54/8 92/19 112/11119/8 120/21126/16136/4150/19 70(20 70(22 84/7 96/17125(7125(7125(10 mine [1] 23(10 154/2 160/13 160/22 minimal [1] 71(22 Mr. [74] 34(25 36(12 37/3 39(17 40(24 46(2 matters [3] 6/8 84/11 97/22 minor [1] 128(12 46/15 47/23 49/2 50/150/3 50/14 51/2 54/13 Matthiesen [5] 33(14 33(20 33(2133(22 minute [12] 17(2119(22 23(19 27(14 67(6 56(2o 56(24 59/3 6o(1o 70/6 72/6 72(12 33/25 67/6112/20122/5130/13132/23140/1140/1 73/9 73(2174(4 74(20 74(25 75(176(11 may [62] 12(1612/1617(417(517(918(14 minutes [2] 101(5 101(5 81/25 82/4 83/18 84/4 84/8 84/10 84/15 20/22 21/15 25/22 26/4 27/2 29/23 35/18 mirror [1] 36(23 84/16 85/16 88/9 89/16 90/14 90/14 90/23 37/6 45(23 47(24 58(24 59/9 59(13 6o(24 misconduct [4] 21(6 22(4 28(13 28(17 91/14 94/19 99/4100/6100/6103/9106/4 60/25 61/24 62/163/3 63/4 67/20 69/10 misheard [1] 52/1 108/22 111/1114/18120/16120/16 121/2 69(11 73(10 73(11 75(18 79(14 79(15 81(3 misrepresented [1] 66/1 124/1124/14127/5128/4135/14135/23 81(22 81(23 86(18 86(19 92(17 93(23 96(2 misses [1] 20/to 140/15 146/4 146/20 149/1149/8 149/14 96/20105/4107/18112/18 115/3119/21 missing [5] 20(17 77(15 77(25 119(21134(3 150/8150/25151/22153/14154/4160/11 120(14125(22125(22125/24127(9130/15 misstatement [1] 60(19 160/25 138/12 141/19 144/23 145/8 151/12 152/3 mistake [2] 78/16 78/17 Mr. DeLeon [2] 100(6149(8 158/14 159/13 159/19 misunderstands [1] 114/4 Mr. Gannaway [30] 34(25 36(12 39(17 maybe [11] 10(12 21(13 21(17 25(15 55(25 mitigate [1] 51(21 46/2 54(13 70(6 73/9 75(176(1181(25 82(4 74/16124/5130/13 138/6144/17161/11 mobile [1] 146(25 83(18 88/9 89(16 90(14 91(14 94/19 99/4 Mayor [1] 4(22 model [20] 6(216(23 7(2 7(16 7(18 9(25 103/9106/4108/22111/1120/16121/2127/5 McDonald [2] 51(12147/4 10/811/1915/1617/919/18 25/13 25/15 128/4135/14150/8150/25153/14 McKinney [1] 3/4 25/18 26/4 27/3 35/2136/1137/12157/6 Mr. Gannaway's [4] 46(15 84(15 85(16 me [72] 4/24 5/5 13/15 15/13 16/116/20 modify [1] 84(20 120/16 26/9 26/15 30/15 35/14 36/16 40/5 41/24 mol [1] 3(13 Mr. Hale [1] 149(14 44/4 44(2o 49/5 57/17 57(23 59/7 65(2o moment [3] 16(157(25 67(21 Mr. Hale's [2] 149(1151(22 65/2179/10 80/10 83/15 83/17 90/15 92/19 Monday [1] 101/3 Mr. Hancock [1] 160(25

1066 24/8 24/12 40/16 49/25 78/6 78/7 78/9 108/10 116/4129j2130/12141/3141/5145/11 M 78/10 78/14 156/14 numbers where [1] 13j21 Mr. Jolmson [14] 37/3 74/474/20 74/25 next[18] 31/633/434/945/345/550/1 numerous [2] 27/23 90/13 84/4 84/8 84/10 84/16 90/14100/6135/23 50/1150/2158/22 60/14 60/17 63/16 63/22 nut [1] 61/3 140/15154/4160/11 113/18 113/22123/8 140/23 159/25 nu~fll 14d/21 Mr. Moran [2] 124/1124/14 next time [1] 33/4 Mr. Moran's [1] 114/18 nexus [1] 73/3 0 Mr. Wargo [8] 40/24 51/2 56/20 72/6 no [116] 1/3 2/3 2/19 3/3 3/10 9/6 9/119/19 o'clock [4] 23/23 75!24128/4128/5 72/12 90/23146/4146/20 15/2115/2415/2517/2117/2117/2318/15 oath [1] 106/7 Mr. Wargo's [1] 73/21 21/14 21/19 24/2 26/25 27/14 27/14 33/15 object [6] 99/2 99/25100/3 100/24140/11 Mr. Young [8] 47/23 49/2 50/150/3 50/14 34/3 35/4 37/2139/20 39/22 40/5 40/18 141/13 56/24 59/3 6oj10 46/7 48/20 52/2 52/7 52/7 52/12 52/24 54/5 objection [3] 29/19 42/10 95/10 MS [29] 2/112/18 5/7 8/13 9/22 19/15 21j2o 57/24 57/25 58/7 6o/10 64/10 64/2o 66/16 objections [3] 36/3 38/2 137/12 48/22 52!19 58/4 69!22 105!15 106!12 66/17 66/17 66/20 70/23 72/1172/19 75/9 obtain [1] 104/2 108/23 110/23 113/15114/1116/11119/23 75/22 78/20 78/25 79/23 79/24 80/2 80/25 obtained [5] 45/15105/15 125j22 126/1 121/18 121/22 122/4 122/18 123/14 124/12 81/4 87/14 87/20 87/24 88/7 88/16 88/22 144/12 124/20 126/18 127/19 160/19 91/2 91/24 96/14 97/7 97/9 97/10 97/15 98/9 obtaining [4] 47/12 47/13 60/5 137/25 much [20] 8/23 8/24 10/23 30/2145/17 101/4101/11102/13104/16110/12116/17 obviously [5] 6/22 11/16 49/3 115/24 104/20107/1117/14139/20139/24145/21 116/20117/4123/20124/16124/20130/14 124/24 146/1146/4154/4155/21155/24158/1158/4 130/19131/2131/6131/9131/10133/4137/2 occasion [2] 17/4115/5 158/5 160/21 139/11140/12141/4143/8143/8144/9 occur [1] 89/15 multiple [1] 94/8 146/23146/24147/8147/9148/24149/10 occurred [3] 106/10 109/21163/10 multiplication [2] 157/11157/14 149/13 150/24 151/5 151/8 153/6 153/20 occurrence [1] 133/8 must [4] 33/9 100j10 105/21135/3 153/22154/16155/10156/10 156/231S7/17 occurring [1] 112j1o mutual [1] 31/14 non [4] 83/12 98/16 107/8 141/14 October [9] 18/18 32/20 32/2S 34/8 34/8 my [39] 4/4 4/216/19 7/913/S 24/17 27/9 non-company [1] 83/12 49/8 49/1S 49/24 77/14 30/17 43/19 44/7 S1/2S S4/1154/22 SS/11 non-further [1] 141/14 October 10th [1] 49/1S s6j12 s6j12 s6/23 67/172/1174/16 76/10 non-secular [1] 98/16 October 23rd [1] 49/24 81/2S 84/186/18 90/4100/S100/11113/11 non-TitleMax [1] 107/8 off [12] 8/23 14/2 23/17 24/6 3S/3 41/13 128/7136/13 141/19 144/111S6/4 1S7/71S7 /7 none [6] S/1S 140/14140/1S 140/20 142/3 74/4 74/6 74/1S 101/16 10S/19 1S0/10 1S7/11 :1~141~~~13161/24 142/9 offered [2] 122/18 163/12 ffi.;,self 1 iAa ..1a- nonentity [1] S1/1S offering [1] 8s/2 nonstarter [1] 46/22 office [12] S9/7 S9/8 81/4 81/1S 86/11 N normal [3] 64/2 64/9 92/4 13S/1S13S/16 13s/16 136/s 136/s 136/7136/7 name [15] 18/2 18/8 22j22 22/24 72/16 nose [1] S9/24 officer [1] 1S2/1 79/20 8oj23 88/3 97/2 97/3 10oj6116j16 not [255] offices [1] 70/4 124/2133/2113S/18 Notably [1] 111/1 Official [2] 163/4 163j19 named [7] 80/2S 81/7 82/1 82/8 99/16 notate [1] 38/20 often [1] 109/11 103/19 103/19 notation [3] 39/6 39/18 41/6 oh [6] 4/23 S4/18 71/19133/16136!6161/4 names [13] 19/22 20/8 27/13 27/24 39/16 notations [3] 38/11 38/24 42/1 okay [115] s/6 5/9 s/16 7/4 9/110/1S11/11 47/1313S/20 136/10137/10 1S1/161S1/19 note [4] 40/4 40/8 40/11108/13 11/1812/3 12/612/1213/1714/1218/1219/4 1S7/21S7/S noted [2] 39/4 66/24 21/4 21/20 22/16 23/19 2S/3 26/19 26/19 Nancy [1] 40/7 notes [5] 38/2139/4 41/141/2123/6 27/18 28/4 28/2128/2129/9 29/24 30/24 narrative [4] 9/23 9/2410/6 18/20 nothing [21] 10/13 49/7 so/19 so/2S so/2S 30/24 31/132/1132/13 33/24 34/20 34/23 narrow [2] 83/3 94/16 s2/8 s2/13 54/24 65/8 6s!2o 9S/24 98/21 3S/2 35/17 36/8 37/22 38/138/9 41/23 42/7 narrowed [1] S/1S 123/2S 134/22 140/8 140/9 140/10 144/S 44/19 4S/3 4S/13 46/6 46/16 46/23 46/2S native [1] 39/7 1S1/16 1S3/2S 1S4/14 48!22 s4/1o s4/17 s6j12 s6/13 s8/2 6oj13 nature [1] 153/3 notice [2] 49/24 so/1 60/22 62/18 6S/17 68/6 73/22 74/18 76/12 nay [1] 26/16 noticed [4] so/1150/22 60/9 136/14 76/14 76/24 77/8 82/2183/2187/10 89/20 NE [1] 2j12 notion [1] 99/1 89/20 92/10 99/20 100/13 101/7101/14 nearly [1] 36/20 November [6] 1/17 48/7 49/2176/10102/4 102/6102/10102/14106/4107/24108/22 necessarily [8] S/23 8/10 90j22 98/23 138/18 113!9 118/16 122j14 123/8 123j18 12S/14 108/21126/10 140/3 144/13 November 12 [1] 138/18 126/4129/25130/1131/8132/13137/6 necessary [2] 112/8 134/12 November 13th [1] 49/21 137j2o 137/21139/9140/13140/17140/18 need [36] 8/710/213/416/1116/1819/7 November 15th [1] 48/7 141/5145/3 148/10 1S4/12 1SS/18 1SS/19 23/25 2S/9 41/24 42/12 42/15 S4/8 S5/22 November 5th [1] 102/4 1S8/7159/71S9/1S 1S9/17160/2 161/11 6oj2 61!19 62j1162/13 62j16 6s!1 6s/s 83!2 now [54] 7/4 7/1710/111/113/4 14/10 16/3 161/19 85/14 88/12 110/22110/24112/8 114/22 16/9 16/1S16/15 18/1219/119/24 20/23 24/1 old [2] 6j2o 61/24 124/18 125/11133/10134/11135/7138/23 26/2129/11 30/7 31/10 31/16 34/20 37/3 OLGA [2] 3/9 4/19 140/13 155/12 161/11 37/4 37/12 41/18 43/2144/7 47/16 50/3 omission [1] 61/9 needed [3] s8/2o 91j22 104j12 S4/12 60/13 61/19 64/18 69/4 72/13 72/23 . once [13] 14/6 15/19 18/10 18/1120/19 needing [2] 92/24111/S 7S/18 7S/24 76/14 77/7 83/24 90/2 104/23 20/19 3S/9 3S/12 3S/13 35/20 39/24 66/11 needs [7] 19/20 26j12 36/1s 43/12 S4/21 106/4108/1S111/16117/3149/S149/10 11S/16 118/22150/4 1S1/241S2/9 1s2/10 1s6/s 1s6/11 one [162] 6/4 6/4 6/6 7/14 7(23 9/310/18 negate [1] S3/16 number [41] 8/2014/3 21/14 61j13 77/21 11/211/711/1411/2017/419/1319/1419/17 neglects [1] 31/18 77/22 77/2S 82/16102/8 110/10 111/24113/S 21/3 21/4 21/S 21/17 21/2122/4 23/12 29/17 negligence [3] 61j20 61j21 66/4 113!13 113!13 114!12 115/s115!19 116/5 116/6 31/8 31/17 32/25 34/9 3S/9 38/24 39/139/1S negligent [3] 61/9 61/20 136/9 116j19 118/10 118j13 118/18 124/17124!19 40/10 41/16 41/23 42/10 43/4 43/22 44/19 neither [4] 47/11 92/13 11s/21116/9 12S/16 12S/17126/2 126/14127/14133/22 44/22 46/3 48/12 sols s1!1151/12 s1/18 never [16] 50/13 S0/14 57/24 s8/17 70/6 134/4134/14139/9139/16143/20143/22 S1/19 S1/22 S2/2 S2/S S2/7 S3/4 S3/6 S3/7 8oj2 8o/6 8oj1187/8 90j16 97/310S/17 143/25 146/11146/12 1S4/3 53/7 s3/15 s3/23 s4/4 s4/8 ss/10 s6/4 56/4 106/7109/22123/15 1S3/1 numbered [2] 1/18 163/9 57/2 s7!15 57/16 57/16 58/16 s8/17 59/2o new [16] s/7 20/20 21/9 21/13 21/21 24/7 numbers [12] 13/2113/24 43/7 47/12 47/13 60/10 61/25 63/2164/6 6S/16 67/16 68/4

1067 132/6 132/16133/3 138/12138/14139/8 p 0 145/21146/2 146/14149/5 152/18153/25 one ••• [87] 69/472/2074/1077/677/20 157/23 163/7 package [2] 123/1127/7 79/179/7 80/3 80/25 81/4 81/25 82/2 82/2 other's [2] 30/12 38/19 page [24] 12!24 16/5 29/8 36/8 54/154/12 82/3 82/6 82/8 82/8 82/10 82/12 82/13 others [4] 54/9 105/15121/3 132/9 61/2 62/6 62/23 63/16 63/16 63/22 63/23 84/1187/20 88/22 91/16 92/3 92/1192/13 otherwise [5] 14!2518/23118/17137/9 64/2195/20 113/15113/18 113/22114/5114/6 92/23 93/10 93/24 94/1194/25 95/4 96/12 161/18 123/1123/8 150/12 150/12 98/9100/17101/2 101/3 101/11101/15 101/15 ounce [1] 135/9 pages [1o] 95/22103/10 106/5 109/16 101/19 101/21102/6 102/16104/18 104/24 our [132] 4/20 6/8 7/20 8/15 8/20 9/7 9/23 109/24115/23121/18 121/21121/24122/5 105/11106/11109/17113/14113/16 114/9 10/8 12/13 14/114/3 14/714/23 15/15 15/17 paid [4] 41/13 135/2163/15 163/15 114/23 116/9 118/8 118/8 120/15 120/18 121/5 17/8 17/8 18/1218/1718/23 18/2419/3 21/6 paid/will [1] 163/15 121/10121/11124/12125/11130/4130/5 21/10 22/4 25/12 26/4 27/3 29/20 29/2131/9 paper [3] 47/198/7149/22 130/6130/16 131/1131/9 132/2135/1135/13 33/23 36/3 36/1136/15 37/2 37/5 37/11 papers [4] 66/18 75/9 94/9 111/11 135/15 144/23 147/2 147/4148/7148/19 37/23 37/24 37/24 38/2139/20 39/2140/3 paradox [1] 50/25 149/21149/22 150/12 150/15 151/25154/1 40/19 42/14 42/17 45/25 46/6 46/2147/1 Paragraph [6] 79/9 79/12 79/17 80/21 154/19 154/20 47/5 55/17 55/18 57/7 58/13 65/23 65/25 80/22 87/8 onerous [1] 108/13 66/6 66/8 66/9 66/13 69/15 69/19 69/20 parallel [1] 68/16 ones [15] 13/113/2 69/6 69/22 69/22 75/12 69/23 70/15 71/3 73/3 73/5 75/5 75/9 75/20 paraphrasing [1] 17/4 79/3 94/25 122/17122/19 126/20 140/24 78/14 78/15 82/9 83/13 84/3 85/5 85/8 Pardon [1] 100/22 143/12 143/14 143/17 85/10 86/6 86!12 90!12 92!23 93/5 94/9 parens [2] 48/9 48/9 Online [3] 93/13 96/18 96/25 99/14102/20 102/20103/17104/22 105/24 parent [2] 45/9 45/10 only [64] 14/2315/1130/20 37/15 42/8 106/23 108/16 108/16109/6 110/14110/14 parenthetically [1] 38/7 46/18 46/18 47/22 47/23 48/10 48/12 48/19 110/25112/9116/21117/5117/21118/1118/18 Park [1] 2/20 48/19 48/20 48/2148/2149/2 49/4 50/5 120/6 121/14125/1125/11125/23 126/5 parking [1] 47/12 50/12 50/17 51/22 52/2 53/18 53/22 54/4 126/13132/10134/20135/1136/1137/17 parlay [1] 134/25 54/8 54/24 54/25 55/10 56/4 57/15 63/4 139/8 145/5 146/24147/1150/5152/15 part [18] 5/2411/17 25/18 39/20 56/18 63/1 67/5 69/2171/171/13 71/16 71/19 73/23 75/10 152/19153/7157/20158/10160/15161/8 79/2 80/15 85/21 85/21 87/7104/19 129/21 89/17 90/5 103/14103/15 105/16 107/22 161/15 131/16150/25152/19154/24157/20 108/24111/3 111/21111/25 114/17116/14 ours [1] 39/14 participated [2] 40/9 87/21 122/17132/10134/1145/5147/9147/10155/1 ourselves [2] 30/9 100/19 particnlar [13] 19/140/1179/9 116/2 127/6 157/7158/11160/4161/25 out [88] 10/2311/313/4 27/9 32/8 33/1 129/7 137/23 138/2 138/7139/3 139/15 open [1] 163/10 38/18 38/19 38/24 39/139/5 39/5 39/18 139/17 146/21 operate [1] 154!21 39/19 39/2140/16 40/19 40/2141/9 41/12 Particnlarly [1] 68/16 operation [1] 103/20 41/16 42/142/2 44/22 46/1153/22 59/13 parties [19] 6/15 7/1120/12 21/16 24/21 operations [1] 14/16 61/21 62/6 64/7 67/16 69/14 69/22 70/6 70/7 31/14 32/9 38/19 49/8 49/15 61/5 73/12 94/3 opinion [1] 54/11 71/17 71/20 72/2 73/16 75/14 79/21 80/18 99/23 100/3100/19117/2163/8 163/13 opportunity [3] 7/11110/3 134/14 83/7 83/14 85/2 86/6 88/4 88/17 93/11 PARTIES' [1] 1/14 oppose [1] 155/25 93/12 94/2 94/14 94/24100/5 103/21109/6 Partnership [1] 73/18 opposing [7] 102/9 107/14108/1108/12 109/23111/15115/23116/11117/5117/21 parts [1] 8/16 110/4151/24156/2 119/10 122/17123/11124/5 124/21125/15 party [17] 5/20 31/18 43/22 60/23 65/24 opposite [1] 129/17 125/24126/7127/11127/15127/21128/3 72/16 72/2173/5 88/25 93/1 94/6 96/10 99/2 opposition [1] 108/2 134!11135/18 135/20 135/25 136/5 136/8 99/2 99/25 101/16134/7 oral [2] 1/14 54/14 136/11139/3 142/13 146/2147/16 149/24 Paso [1] 73/18 orchestrated [2] 56/3 56/5 153/18 157/8 passes [1] 25/11 order [48] 6/14 7/3 7/18 8/913/14 23/16 outrank [1] 161/1 past [2] 25/23 90/3 34/23 34/25 37/3 38/142/14 42/2142/22 outs [3] 38/14 41/19 42/1 patent [1] 59/11 43/144/25 45/6 58/2170/4 71/14 76/3 77/12 outstanding [1] 126/22 pause [1] 75/7 78/179/5 79/6 8o/3 82!23 84/18 84/22 85/7 over [17] 7/12 9/10 21/12 49/17 50/10 58/16 pay [2] 78/18 100/12 87/8 89/22 89/25 90/23 92/20 100/13 '63/21 74/23 107/11117/5 120/22 134/1134/3 payment [3] 109/7116/15 116/20 100/15 100/15 100/16 101/1104/2104/12 134/16134/17157/17157/18 Peachtree [1] 2/12 110/21111/12133/7134/7136/17157/4 overbroad [3] 98/22 131/18 131/19 pen [4] 16/21 29/16 35/1135/13 159/14 overlap [66] 7/6 7/23 8/23 9/1 9/9 9/10 pen-and-ink [1] 35/11 ordered [24] 6/19 6/23 9/22 10/612/7 9/1110/711/111/2211/25 14/10 15/20 18/7 pending [2] 91/20 133/7 12/1413/5 13/15 14/9 21/136/22 42/25 46/9 18/10 18/12 18/15 18/2218/2419/10 19/20 Penny [35] 105/11105/15 105/23 106/6 46/14 48/18 49/22 58/2160/9 76/17 77/11 19/23 19/23 20/8 20/15 20/20 22/22 22/24 107/4107/19107/21108/7108/18109/5 78/6 79/16 80/16 91/1 23/15 24/8 24/18 24/22 26/23 29/24 30/13 109/7109/16 110/11112/2 112/16 115/13117/9 ordering [1] 92/14 35/3 35/10 35/13 35/20 35/2137/1138/25 117/11120/15 120/19 120/20 120/24120/25 orders [10] 74/2 74/8 74/10 77/177/5 39/10 39/10 39/13 39/24 40/4 40/8 40/14 121/7127/22127/25129/6129/10129/22 78/23 85/17104/15111/9 156/9 41/8 41/17 74/1174/23 75/10 75/14 76/3 76/9 131/21132/7132/11142/12145/19146/7 ordinary [1] 90/18 76/15 77/15105/1117/1128/15156/14156/19 people [71] 7/5 7/6 8/21 9/10 16/2116!22 organization [2] 55/19 58/10 157/20157/21 17/1618/1319/1219/17 20/22 21/16 27/6 organizations [2] 53/2 54/16 overloaded [1] 66/13 27/8 27/23 27/24 39/14 40/140/6 52/25 original [1] 11/1 overly [2] 39/22 41/22 54/18 55/18 61/5 62/8 68/25 69/17 70/1 originally [2] 20/16 98/12 overrnle [1] 38/2 71/25 8o/23 8o/23 84/13 84/25 85/3 85/18 originated [2] 28/6 28/9 overrnled [3] 36/4137!12138/10 86/12 92/10 94/24 96/6 97/17 98/13 102/3 other [68] 8/510/22 18/7 21/5 21/5 21/16 overseeing [1] 53/10 104/13 106/16 113/13 114/12114/13 114/19 21/16 23112 25/9 31!18 38/5 38/6 38!18 overstatement [1] 75/9 116/2116/12119/22120/23127/13127/13 38/24 39/2 43/8 43/22 45/2 45/15 45/15 own [7] 50/15 53/9 54/19122/16146/24 129/18 134/8 134/17135/12 135/14135/19 50!6 53/16 53/23 54/18 59/22 6o/5 6of7 146/25 158/13 135/19 135/20 135/24136/2 136/10 136/20 61/9 61/14 64/23 65/166/4 67/17 68/8 75/12 owned [1] 117/25 138/2138/4140/5147/5153/16158/15 79/9 82/2 91/25 95/2 97/22101/22103/17 owner [1] 96/5· people's [2] 70/13 156/25 104/23111/19112/2114/23117/7117/24 owns [2] 45/1145/12 Peoples [7] 24/18 24/20 35/14 76/8 76/14 123/15 124/11125/6 128/24129/6 130/21 156/15 157/9

1068 p 30/1130/14 30/15 30/17 35/23 35/25 37/2 proceeds [1] 28/11 39/10 44/7 45/24 46/6 53/23 57/14 70/6 process [4] 75/8 78/18 78/19 117/3 per [9] 7/2 7/17 8/2 9/25 10/8 11/13 11/24 73/16 91/9 91/13 92/17 99/13100/14109/10 produce [51] 12/713/5 13/15 14/12 14/13 12/4 63/4 109/12112/13114/24125/24127/21128/2 14/2515/9 18/18 31/10 32/8 32/13 32/14 per-customer [8] 7/2 7/17 8/2 9/2510/8 128/12138/13 144/1151/17152/12 32/25 34/12 35/12 35/13 36/2138/2 40/25 11/1311/2412/4 pointed [5] 19/15 69/14 69/22116/11127/11 42/14 43/4 43/5 43/8 43/13 44/18 78/6 78/7 percent [6] 65!25103/11107/11108/18 pointing [3] 53/8 110/15115/9 92/14 95/12 97/12 97/25 106/13 106/18 108/20108/25 points [2] 72/1127/8 106/20108/4111/24115/17119/5128/7 percentage [2] 21/17109/19 poke [1] 150/21 139/20 140/3 141/14141/20141/24141/25 perfectly [3] 97/14 98/9 100/8 policy [5] 62/25 83/13 89/2158/10 158/15 151/15 153/3154/7155/11155/13 157/22 perform [1] 153/2 pop [1] 145/16 produced [44] 8/1910/1613/2013/2118/4 performance [3] 135/4138/6154/24 popped [1] 113/13 18/4 20/19 31/12 32/7 33/18 37/14 43/18 performed [4] 112/17127/24152/22 153/1 portion [2] 79/4 80/7 43/2144/13 44/15 44/23 46/10 50/12 50/16 perhaps [2] 75/3 157/8 portions [1] 163/7 76/11 89/25 95/19 97/11104/18 106/12 period [16] 15/6 20/5 24/9 74/24 76/7 87/3 position [10] 25/6 26/2128/6 28/8 37/4 106/18 111/3 113/19 121/21121/24140/12 96/19104/25111/3128/17129/12133/4134/1 44/7 46/13 47/2196/3146/24 149/22 150/6150/15 151/22152/20 154/19 134/5160/7160/7 possess [1] 96/20 155/2 155/17 156/14 156/19 156/23 156/25 perjured [1] 129/18 possession [2] 17!17108/14 157/1 permissible [2] 63/5 69/1 possible [3] 75/13 77/18 126/3 producing [3] 13/15 115/17 119/2 permitted [3] 64/23 97/4159/14 possibly [3] 84/5106/10 114/13 product [2] 17/8 37/4 person [42] 9/417/5 24/8 24/10 24/13 postnre [2] 72/19 72/20 production [41] 12/25 15/2131/20 35/22 24/15 25/9 40/13 41/12 47/22 50/13 50/14 potentially [2] 21/9 104/17 35/24 46/12 97/17 98/13 102/5 103/9 104/1 51/12 53/15 55/5 55/10 57/3 57/7 57/16 59/25 pound [1] 148/22 104/6104/7105/4110/25111/18112/4117/13 61/7 62/1 68/8 68/12 68/12 69/5 72/15 72/15 practical [1] 157/24 118/20120/6 121/15 123/14128/14128/16 78/9 78/10 80/1186/17 87/3 96/18 96/22 practice [7] 40/140/2 47/2198/9 111/8 129/5 133/7137/24138/20138/25 139/2 105/24108/8 109/17121/16 123/6 124/8 118/1133/13 142/12 142/17142/18 142/22145/1147/24 124/22 practices [2] 104/5 104/10 148/16150/10150/16150/19157/21 personal [8] 53/13 55/14 55/2158/19 63/3 precise [1] 82/25 productive [3] 119/20153/5 157/25 63/10 63/15 63/20 precludes [1] 71/8 profit [14] 7/19 8/212/412/712/1513/24 persons [1] 80/16 prefer [1] 127/19 13/2514/3 14/16 14/2115/5 43/4 43/7 43/9 perspective [1] 92/24 prejudiced [1] 43/23 profit-and-loss [8] 12/15 13/2414/1614/21 phase [1] 61/11 prejudicial [1] 44/17 15/5 43/4 43/7 43/9 phones [1] 147/16 preparation [1] 163/14 profits [11] 13/113/8 13/9 13/12 14/14 14/14 phrase [2] 39/9 70/21 prepare [2] 34/25 76/9 14/18 14/18 15/15 15/18 37/18 physically [1] 63/11 prepared [4] 30/135/20 35/21142/21 promotion [2] 5/1 5/2 pick [6] 22/23 65/18 65/19 65/19 145/9 preparing [7] 7/5 7/6 24/18 24/22 34/23 proof[3] 29/17 97/10122/22 145/12 85/1 88/23 proper [6] 47/20 49/9 49/16 49/22 92/20 picked [1] 18/2 present [7] 18/13 27/3 29/13 30/19 30/20 129/12 picking [1] 37/2 31/5107/13 properly [1] 78/11 pictnre [1] 73/4 presented [7] 17/9 25/128/134/15107/15 proposed [1] 33/23 piece [1] 148/7 111/2 122/12 protect [1] 68/14 pieces [1] 9/24 Presiding [1] 1/19 protected [1] 63/15 pig [1] 150/20 pressing [1] 92/23 Protection [6] 5/19 6/3 54/193/5 93/17 pit [3] 119/7119/8 121/13 presumably [2] 39/17157/2 94/4 placed [1] 43/1 presumably and [1] 157/2 Protective [4] 42/14 45/6100/13 100/15 Plaintiff[sJ 4/13 5/17 7/2o 69/5134!23 presume [2] 39/12 154/6 proud [1] 72/10 PLAINTIFFS [28] 2/7 2/15 2/23 4/5 4/10 presumed [2] 66/2 71/4 prove [21] 9/16 25/8 25/9 28/17 28/19 4/115/216/17 6/23 7/8 7/17 8/811/18 22/17 presuming [1] 88/9 28/20 29/129/3 62/14 67/7 67/8 69/19 73/11 31/5 33/19 36/19 77/14 79/22 92/25 94/13 pretty [1] 55/15 73/11100/9 104/22106/5109/15111/15112/9 95/23 96/196/20123/16151/4155/5159/3 prevent [1] 112/7 134/20 Plaintiffs' [19] 7/19 8/2 8/2 8/3 38/14 prevented [1] 37/11 proven [1] 69/18 38/16 67/9 74/2 74/7 74/9 88/5 95/18101!18 preventing [1] 134/20 provide [37] 8/9 9/23 14/814/1614/20 105/18 106/8 109/23 129/16 129/20 135/10 previous [3] 25/7 25/24 73/20 14/22 15/115/5 15/19 15/19 16/117/2 20/20 plane [1] 23/23 previously [10] 8/19 103/18 104/18 105/25 21/132/135/10 36/1138/23 42/25 77/12 plans [1] 142(14 108/2 128/14134/1135/23 142/21150/15 77/20 80/16 89/20 94/6101/3102/11102/19 plate [10] 47/12 68/8 99/6 99/21108/9 primary [1] 77/22 107/18 108/13 110/20126/17127/18 137/24 110/6129/2 130/12 142/14143/2 principal [1] 71/12 142/8155/5155/5157/4 play [1] 38/4 print [1] 153/18 provided [27] 7/118/1216/818/2120!12 played [2] 85/1 85/19 printed [1] 118/7 36/15 50/16 76/6 76/8 77/25 78/14 78/17 plea [1] 157/7 prior [11] 6/19 18/2118/22 21(17 34/12 78/22 80/3110/2110/8114/6117/17117/20 plead [1] 73/17 73/19101/24102/24105/4108/15110/1 123/1123/14127/7133/19 140/21150/17 pleaded [1] 94/20 private [1] 146/25 152/17 152/21 pleading [19] 58/13 61/12 64/18 65/3 65/11 privilege [6] 50/16 50/16 58/23 59/5 90/25 provider [2] 63/12 68/13 65/20 66/17 67/4 68/17 69/13 69/24 71/14 140/21 providers [1] 95/2 71/16 72/7 72/12 72/2173/7161/9 161/17 privileged [3] 46/12 50/17 6o/12 providing [3] 37/10 37/1180/4 Pleadings [1] 161/4 probably [1o] 23/23 33/7 44/20 60/11 proximate [1] 7(20 please [1] 70/24 91/10 92/4 97/13102/16114/7139/1 prudent [1] 59/13 pleasure [2] 21/22 57/2 problem [11] 14/9 77/17 77/19 84/15 86/25 public [1] 109/25 pled [6] 67/2 73/10 73/1198/17103/23 99/9 139/21144/3 158/8 158/9 159/18 PublicData [sol 61/4 62/22 63/9 65(5 149/9 Procedure [2] 61/12 65/11 65/23 66/2 68/19 69/6 71/7 95/195/19 95/20 plug [1] 157/5 proceed [1] 6/1 96/4 98/12103/9 106/14106/17106/21 point [45] 7/22 8/2310/513/414/214/2 proceeding [2] 20/12 97/21 106/23 109/11110/11111/25 113/10 113/20 14/2317/1117/1418/15 20/13 24/2129/17 proceedings [4] 1/171/21163/7 163/11 115/12117/13121/18121/23121/24122/6

1069 p ream [11 98/7 relation [11 12/1 reason [131 21/9 23/4 23/6 39/23 46/14 Relativity [21 153/7 153/8 PublicData .•• [2o1 123/1123/6123/13 50/4 60/3113/14117/2129/21135/7151/23 relevance [11 135/6 124/18 127/9 127/15 130/21139/13 139/18 156/10 relevancy [11 36/13 140/5 140/7142/14143/13 143/17148/8 reasonable [91 33/3 63/14 63/19 63/20 relevant [381 15/2 37/6 37/7 37/17 41/7 148/12148/13149/20 149/24150/12 90/16 95/21119/12152/1157/9 41/18 41/20 41/22 45/14 46/15 50/13 50/20 PublicData.com [71 27/9 61/18 71/25 reasonably [41 32/10 37/15119/13 119/14 50/20 52/9 52/15 55/14 55/23 55/25 56/24 82/10 94/7 114/7 136/7 reasons [21 91/1797/14 59/8 59/10 60/5 60/7 63/17 84/5 85/12 pull [41 16/1117!16 s8/216o/9 recall [61 12/6 68/168/11105/4105/21 96/19 96/19 96/20 96/23 97/11116/24133/5 pulled [21 49/24 129/10 148/20 133/6147/6147/10150/2152/2 punish [21 74/15 138/7 recalls [21 8/22 49/11 reliable [21 19/25 20/3 punished [11 74/12 received [41 93/2 105/6132/25 142/6 relief [11 43/15 pure [11 97/24 recently [11 57/6 remaining [11 140/24 purported [11 53/20 recipient [11 63/3 remember [71 23/16 54/12 75/18 94/25 purports [11 48/15 reciprocal [21 42/24 44/8 98/11121/17148/3 purpose [n1 21/1447/1247/20 64/22 recitation [11 22/3 remembers [11 46/4 64/24 66/2 66/14 71/9 103/15112/3 117/7 recite [11 68/1 remind [11 44/20 purposes [91 69/17 96/2 97/6103/2103/5 reciting [11 43/17 reminded [21 47/20 58/11 103/21120/10 125/11157/24 recognize [11 70/8 renewed [11 9/4 pursuant [71 23/15 42/14 43/9 77/25 84/24 reconsider [21 42/23 82/24 reopen [11 115/16 89/25 91/11 reconsidered [1] 82/24 rep [21 49/24 50/21 pursue [21 151/8 151/9 record [221 1/2 27/127/1127/16 27/20 47/3 repeat [21 8/18 8/19 pursuing [11 119/8 48/20 49/12 51/9 54/25 60/20 72/24 74/4 repeatedly [11 59/2 put [161 9/20 30/4 38/2141/6 44/25 47/1 74/5 74/6 74/15 83/5109/9 124/1163/9 report [51 135/21154/7155/5 155/7155/11 50/19 57/12 75/8 82/189/12121/19151/9 163/11163/15 reported [31 1/21 51/12 163/10 151/12 158/19 159/16 recording [21 129/1130/12 reporter [31 4/4 163/4 163/19 putting f~~,?S(~< records [91 47/15 77/15105/22106/23 REPORTER'S [41 1/2 163/9 163/11 163/15 ln=amid 1 <I 106/23 109/25 122/16 123/23 124/13 reporting [11 52/25 recover [21 28/8 150/1 reports [31 13/2514/16157/22 Q recovery [11 61/8 represent [21 37/12160/25 question [201 9/19 22/4 22/5 23/7 24/17 redacted [11 31/14 representation [161 22/2 46/15 48/12 30!17 31!24 45/16 45/18 49/5 56/23 73/2 redaction [11 31/13 48/14 48/15 48/16 50/19 53/10 54/23 57/11 87/19 88/1 88/15 112/14120/6 141/18 144/11 REDDEN [21 3/4 163/16 89/11146/22147/15149/3159/7161/15 156/21 reduce [11 152/4 representations [61 54/13 57/10107/15 questions [41 25/24 57/21 94/16 96/10 refer [31 131/14 141/11141/15 107/17145/23156/24 quick [11 6/9 reference [61 41/5 48/4 81/25102/12 representative [71 49/10 49/18 50/152/13 quicker [11 139/24 103/11106/10 58/19 60/3 91/23 quickest [11 6/8 referenced [31 103/9147/5147/8 represented [61 6/24 7/1518/19 46/2111/1 quickly [31 41/4 78/2 78/17 references [11 29/14 161/24 quite [71 49/9 49/12 76/20 76/23 85/16 referrals [11 113/4 reputational [11 157/10 108/20 140/19 referring [51 70/24 79/5 79/6 89/16131/4 request [441 7/415/2116/916/916/12 quote [~1,18/; ~8/9 64/181/7 84/21 lnuotin~ 1 8~, 18 refers [11 130/10 refinance [11 10/10 31/1136/23 38/15 89/18 90/16 97/16 99/15 102/5104/1104/6104/7110/25117/13 118/6 R refinanced [11 8/21 118/19 120/6 121/15 129/23 130/3130/14 refinances [11 8/18 130/23131/2134/23137/23137/24138/20 rabbit [101 105/19106/2106/4106/5107/2 refinancing [11 15/17 138/25 139/2139/17140/22141/16142/11 117/8 119/16124/3124/4156/9 reflected [21 39/9 78/4 148/16150/17150/19 150/25 151/18 153/12 Rainey [11 134/16 reflects [11 163/12 154/23 raise [21 95/9 111j16 refusal [11 75/7 requested [121 13/22 43/18 44/13 44/15 raised [51 6/8 27/6 77/6118/24120/10 refused [21 13/12 102/19 92/25104/23 110/25 120/5 120/20 133/25 Ram [11 110/10 refute [31 117/16 118/25125/12 143/5 163/7 ran [20 1 61/16 64/10 68/7 98/13 100/8 regard [101 52/9 8oj22 87/9 90/13108/9 requesting [41 97/16118/25 120/13 139/20 100/21100/23 101/23 103/22105/23105/23 128/15128/25139/16140/25150/10 requests [361 12/25 36/3 36/18 36/18 38/3 106/1109/5109/7110/11114/1116/15117/10 regarded [11 108/9 43/9 95/15 111/18 111/24115/15 118/7118/9 123/15 153/19 regarding [191 42/22 45/6 80/4 93/1 97/13 120/9 120/13 126/22127/3127/6128/11 Randy [11 134/16 102/20 104/9 105/1107/16107/19108/9 128/25129/7129/8 132/2132/16139/3 rate [21 48/4 48/5 118/9 118/12120/20 126/13 126/14126/17 139/10 140/24 142/3 142/17 142/18 142/22 rates [11 15/17 146/21150/19 143/22146/17146/21147/24150/3 150/16 rat!Ier [31 159/21159/21159/23 regardless [31 24/7 135/7 135/8 require [21 92/3 92/12 rationality [11 92/10 regards [61 101/23 102/5 102/8 102/19 required [41 19/14 61/12 65/11 67I 4 Re [21 48/24150/4 110/9 137/17 requirement [21 67/19 153/20 reach [21 31/20 126/13 regime [11 61/24 requires [41 31/12 52/25 6o/4 65/24 read [151 8/15 9/2410/115/16 16/12 36/16 region [41 13/1215/6133/11133/15 requiring [31 76/3 76/6 91/4 46/5 80/16 82/19 84/19 86/2 86/2 88/13 regional [51 83/18 84/2 84/24137/17 research [51 108/23 108/24112/16119/23 136/24140/1 137/18 119/23 reading [51 8/1410/18 10/19 85/25 131/6 regions [31 133/9 133/11133/17 researched [11 108/19 ready [21 124/9157/13 relate [41 103/11141/11143/6143/14 researching [11 115/4 reality [11 51/17 related [151 8/17 9/18 11/22 11/25 31/1 resell [21 63/3 67/18 really [291 6/417/25 20/2131/135/2 40/17 64/25 105/17106/6 106/11106/12 106/24 reseller [11 63/8 42/11 44/12 44/12 53/1 65/19 65/19 92/13 110/1141/15 142/18 155/2 resellers [21 63/14 65/4 103/22 104/16 104/21105/2 107/16110/22 relates [51 74/10 105/22 131/2 131/2 131/14 reserving [11 151/7 114/10114/11120/8127/19130/10141/1 relating [101 5/2213/136/3 45/1103/22 reset [11 159/16 142/20145/22158/23160/4 119/10 128/8 128/10 129/12 133/8 resigned [11 9/4

1070 road [1] 116/23 SBOT [4] 2/3 2/19 3/3 3/10 R ROBERT [2] 1/19 24/23 scenario [1] 29/6 resolution [1] 126/14 Rogatory [11] 5/21 5/22 6/3 93/3 93/4 Schaefer [5] 130/20131/7131/13 131/14 resolve [t] 110/22 93/13 93/16 94/5 96/9 96/15100/14 132/1 resolved [3] 5/12 5/15 31/8 role [2] 85/1 85/19 Schaeffer [t] 131/2 resources [2] 45/15 48/8 ROMERO [4] 2/114/11 65/15 69/22 SCHAFFER [4] 1/19 23/1 23/9 24/23 respect [22] 13/3 42/9 77/10 83/2 84/9 room [2] 55/16 69/19 Schaffer's [2] 22/22 22/24 89/19 91/24 98/11103/10 103/15 104/16 routinely [2] 74/20 74/21 scheduling [t] 92/18 104/18 105/10 111/18 126/21126/22 128/19 RTP [4] 62/8 66/23 67/167/3 scope [2] 30/7 93/8 128/20 131/9 134/5 142/2143/18 rule [t4] 29/14 29/25 30/22 43/17 61/25 scrape [t] 18/14 respectfully [to] 15/10 21/13 46/19 55/3 62/17 71/4 72/13 75/15 99/3 99/4100/1 screen [7] 68/20 84/19 153/18 154/8 154/9 55/22 57/14 57/17 90/11 90/17136/19 100/4158/25 155/14 155/16 respective [t] 163/13 ruled [2] 11/16 43/16 seal [1] 124/1 respond [t6] 6/17 59/20 8o/10 84/10 Rules [5] 61/12 65/1167/4 95/14 98/2 search [t24] 25/10 26/3 41/21 64/4 64/10 84/25 90/13 90/18 91/10 91/18123/18137/2 ruling [t31 35/11 36/1 41/23 42/3 43/11 68/7 69/16 98/17 98/24 99/10 105/20 105/24 137/2137/5137/6153/24157/18 43/19 43/24 44/5 60/13 60/14 92/24100/19 106/1106/3106/6106/11106/13 106/15 responded [21 89/4 89/18 128/7 106/24107/16 107/19 109/5 109/7110/1 responding [7] 48/10 59/16 84/9 90/25 run [261 21/7 25/2 41/4 41/21 61/4 61/15 110/5110!6 110!6 11o/6 11o/19 111;22 111/23 91/7 91/15 137/3 66/12 68/20 68/22 69/192/4103/1103/20 112/1112/20 112/23 112/24113/3 113/12114/1 response [341 7/2 18/2118/23 42/1145/25 105/16 106/14110/5 111/21113/3 113/12117/6 114/9 114/12 114!16 114!20 114/25 115/8 59/21 70!15 71!11 84!21 84!22 85/16 87/16 122/21127/22129/10 129/19 150/1153/17 115/18 115/24116/1116/3 116/7116/15 116/22 88/10 89/16 89/17 89/2189/2190/9 91/11 running [t6] 24/14 63/25 64/3 65/9 66/8 117/7117/10117/12117/24121/18122/15 91/20 95/4 95/5 99/18 105/12 127/3 127/6 66/14 66/22 95/24 98/21106/2106/16 111/6 123/2 123/10 123/13123/15123/24 124/6 129/22 132/21133/1137/17140/13 140/22 116/21119/7 119/16 119/16 124/7 124/12 124/19 125/16 125/18 125/23 150/17152/19 runs rtl -;,;,r, 126/8 126/9 126/9 127/10 128/19 129/5 responses [11] 31/9 42/13 42/17 77/10 78/22 84/1 96/12101/18 102/2108/13118/12 s 131/22 132/2 135/5 135/15 135/16 140/7 142/2142/4142/11142/17142/21143/5 responsibility [3] 73/4 73/5 75/4 safeguards [t] 63/9 143/5 143/11143/21144/7144/8 144/10 responsible [t2] 5/20 40/13 56/8 6o/23 said [82] 10/9 11/18 13/613/613!19 16/19 144/11144/16 145/1145/13 145/18 145/21 61/5 65/24 72/16 72/21 81/1 81/5 88/23 17/417/13 21/24 25/23 25/25 27/7 28/3 146/1146/7146/8 146/8 146/8 148/17148/24 101/16 29/12 37/3 41/6 42/1143/8 44/150/13 51/25 148/25149/15 150/6 150/13 153/1153/2 responsive [t7] 111/24112/6 115/15 131/23 55/24 57/7 57/16 58/23 59!12 63!12 64!22 153/4153/4153/5153/8153/10153/18154/7 141/14 142/23 143/16 143/21143/25 146/23 65/1 67/7 68/2o 70!9 70112 70!14 71!15 72/6 154/10 154/11155/4 155/4 155/11 147/6149/21150/2150/15150/19153/11 74/7 77/14 83/2 83/3 83/4 83/20 83/21 searchable [t] 121/25 154/23 83/22 83/23 84/2 87/15 88/9 90/7 90/15 searched [to] 69/6 97/1111/25117/11142/5 rest [6] 36/8 66/18 110/24134/5 134/20 91/22 92/15 94/9 94/2194/24 95/196/1 143/15 144/2148/11149/12149/20 150/14 96/15 98!13 100/6 104!19 105!13 105/16 searches [86] 61/16 63/6 64/1 65/9 66/8 restate [t] 40/5 106/6 108/18 112/16 112/17112/19 123/13 66/12 66/14 66/22 68/22 69/172/23 72/24 restrict [t] 111/21 123/15 124/2 129/19 135/23140/11142/16 73/2 73/13 94/17 94/18 95/3 95/5 95/6 95/21 restricted [3] 128/14 129/3 131/20 145/1147/8148/16149/15150/9151/7161/16 95/25 97/6 97/13 98/8 98/14 98/2199/6 result [t3] 7/20 7/2319/18 26/3 26/23 sake [t] 46/23 99/12 99/14 99/21100/8 100/21100/23 73/19107/8110/10110/19125/1145/16 same [30) 13/1414/2015/715/717/1717/22 101/23 102/20102/25 103/14103/22104/14 145/19 150/12 29/8 31!1136/18 38/5 39/23 43/143/6 46/14 105/16105/18106/16107/5107/8 107/22 resulted [6] 63/11 85/6 107/19 110/7135/4 57/1163/18 69/4 82/15 82/17 93/17 94/6 108/5 108/8 108/8 111/6 111;2o 111121111/22 142/22 101/241o4/5116/5 118!23 131/22132!15 112/5 121/13 121/17 122/8 122/21124/25 results [t5] 107/19 108!11111/22 114/5 137/14142/11142/21 125/15 126/17126/19 126/24 126/25 127/2 114/9117/12117/18119/12121/18122/1 sanctions [5] 74/3 74/8 90/4 91/6 91/20 127/13127/18127/22127/24128/8128/15 153/10154/9 154/10 154/11154/22 sand [t) 148/22 128/20 129/2 129/10129/11129/13 129/15 retread [11 6/20 satellite [t] 97/7 129/19 131/21144/8 149/17149/19 150/1 returning [t] 35/25 satisfied [2] 8/7 66/16 152/17 152/22 152/25 155/2 reveal [41 37/4 40/14 40/14 40/15 Savanna [4] 81/1 81/5 85/13 86/17 searching [to] 47/14112/21124/24125;4 revealed [2] 9/10 107/16 saved [3] 101/9 148/7149/10 125/5 125/9 125/10126/9 132/5 149/24 revealing [t] 17/7 saves [t1 101/22 second [27] 11/2012/2413/18 24/23 34/6 reveals [t] 9/11 saw [6] 13/11 61/17 77/15 96/24103/3 103/7 40/24 47/19 54/12 65/17 74/4 75/24 76/9 revenue [4] 7/20 13/20 43/5 43/5 say [59) 4/4 4/14 8/2410/1916/1516/16 76/15 77/16 82/12 82/14 87/7 93/24101/14 reverse [t] 38/19 17/717/12 22/25 28/1028/12 29/23 30/7 101/15 102/23104/7121/21123/17127/22 review [111 7/10 43/22 44/16 83/15 84/23 39/25 42/13 42/13 46/23 49/25 51/16 52/17 150/18 160/16 108/24144/6145/16154/7154/24157/22 52!19 53/22 53/25 54/17 58!1159!15 59/25 secondary [2] ·77/2177/24 reviewed [2] 46/10 83/25 61!25 62/3 70!24 71!1o 71!18 84/16 85/10 secret [2] 42/10 42/18 revisit [t] 105/3 85/23 87/14 87/22 88/7 88/19 92/15 98/18 secrets [t] 42/14 rewarded [t] 138/5 106/4109/9109/14109/19110/8113/20 secular [t] 98/16 RFP's [t] 12/23 115/18 115/19 116/13 136/16 140/14141/14 Security [4] 77/2177/22 77/25115/5 rhetorical [t] 17/25 141/17143/23 144/4150/21152/23 158/11 see [so] 9/1410/13 12/22 16/25 17/2 25/19 right [52] 4/2 5/7 5/10 5/24 7/25 9/1311/13 saying [29] 9/2211/5 25/1131/4 41/2147/2 26/9 28!135/17 39/8 40/2154/5 58/5 63/16 13/713/19 14/15 17/2 19/919/23 20/7 23/25 47/6 60/2 64/6 66/12 70/170/23 71/6 71/11 64/19 77/16 82/5 83/15 95/22100/17100/21 25/5 25/15 27/7 34/24 37/3 37/4 37/12 38/6 75/21 8o;2o 85/10 85/18 88/9 91!2 99/5 100/23 101/1 101/7 101/25 104/4 109/8 113/4 45/17 54/10 60/13 63/9 64/18 65/22 69/3 108/22 108/24 109/22 112/20 112/24 115/24 113/5113/13 113/15113/24115/25119/13 71/20 83/23 86/2 90/2 94/1 95/10 98/3 141/20 152/3 120/20122/16124/4124/5124/11127/10 101/4102/13113/8113/24115/22124/17 says [3t] 43/17 48/6 48/24 49/153/9 53/25 131/23 132/6139/5139/19 141/13 144/17 126/19126/25 129/24129/25 148/23 149/7 55/7 55/7 57/158/10 58/17 58/18 59/16 61/6 146/1146/2 146/9 153/11 151/8 152/8 154/17 62/7 62/17 63/1 63/24 64/1 71/4 73/18 83/2 seeing [t] 125/13 rights [t] 152/4 88/20106/4106/21113/18123/2124/7128/1 seek [2] 24/11120/22 risk [t] 157/10 131/6 153/18 seeking [to] 18/2o 18/25 31/18 37/6 37/7

1071 s 71/23 106/24 shown [7] 63/22 65/6 65/12 67/2 95/18 sold [1] 109/17 solicit [3] 79/22 80/18 88/4 seeking••• [5] 85/8 96/8 123/11132/1149/5 96/4109/21 soliciting [1] 69/20 seeks [1] 104/24 shows [13] 37/17 38/25 41/18 53/13 53/13 some [55] 5/14 5/14 6/7 16/1 16/13 21/15 seem [3] 102/16127/17130/2 85/13 98/8 109/13 114/2120/1123/8 123/24 22/15 25/22 25/23 29/6 31/20 33/18 39/18 seems [5] 91/18 114/10 114/12 114/21137/3 153/3 40/2 41/1142/24 44/5 45/15 47/6 57/21 seen [s] 21/25 49/14 50/25 58!17117/21 side [3] 45/2 153/25 160/15 57/2159/8 63/23 64/8 64/18 64/24 73/3 Select [4] 47/1147/13 47/14 48/8 sides [1] 32/1 77/9 77/14 86/10 90/6 90/9 90/17 91/18 self [2] 5/2 111/3 sign [2] 16/2192!20 92/10 93/2 94/15 94/25 95/18 98/13100/9 self-collected [1] 111/3 signed [9] 16/23 19/17 49/158/9 74/10 76/3 104/17107/13 109/10 109/12111/1111/23 self-promotion [1] 5/2 82/23 113/23 161/17 111/23 113/14122/12 130/5 138/12142/16 seminars [1] 44/21 signer [1] 77/23 144/2 144/17 send [7] 64/7 83/14 86/9143/4144/16 significance [1] 53/17 somebody [5] 34/149/21 86/8 86/8 155/25 144/22 147/16 significant [1] 147/13 somebody's [1] 18/8 sense [5] 13/19 14/17 15/11129!14 136/18 signing [1] 100/14 somehow [2] 7/5 9/18 sent [14] 36/19 55/8 56/9 58/8 66/12 81/19 signs [1] 71/6 sameness [1] 6/21 83/7 86/6 86/12 88/17 94/2 94/2 94/3117/5 similar [8] 36/18 37/2102/17130/5133/25 someone [17] 21/4 27/20 39/4 52/25 56/10 sentence [1] 5/24 134/17137/16 142/22 62/4 63/10 63/1168/3 68/14 69/13 71/6 separate [2] 117/23 129/6 similarly [1] 145/19 71/18 73/7124/21148/7161/8 separately [1] 54/19 simple [6] 30/17 55/2 72/20 87/2 97/24 something [40] 11/3 28/12 28/23 34/2 September [4] 37/18 75/16 75/16 82/25 102/18 45/2149/23 53/20 62/14 62/18 65/17 68/10 serial [1] 82/16 simpler [1] 7/9 68/19 68/24 71/12 74/19 74/20 81/12 84/17 seriously [2] 32/25 100/24 simply [5] 50/18 72/22 73/8 74/23100/4 90/5 91/2 92/17 94/22 97/25 98/18106/3 served [8] 87/16 93/5 97/5 97/17104/1 since [12] 5/116/24 51/23 89/8 89/14 94/24 109/18110/12110/12110/20114/8127/13 104/6120/12150/16 102/23 128/14134/3 134/6 142/24148/1 128/2135/4136/17141/23141/25144/7 serves [2] 21/14 57/2 single [1o] 19/16 29/16 46/20 50/13 59/12 144/20 145/14 145/17 service [2] 70/2 70/3 59/25 77/6135/1148/18157/10 sometimes [3] 41/9 77/23109/18 services [4] 1/5 1/6 4/2103/21 sip [1] 53/24 somewhere [1] 57/23 session [3] 88/22148/1148/3 sir [10] 16/4 32/17 33/9 34/10 34/19 34/22 soon [1] 159/4 set [7] 6/1018/12 49/20 91/24 92/24118/19 76/2 76/5 156/17159/10 sorry [12] 12/13 15/24 58/12 69/25 85/13 160/2 sit [3] 57/2166/11121/9 114/15 130/15136/25139/23 140/7146/6 setting [3] 33/8 33/8 157/20 site [1] 94/10 158/25 settlement'[2] 58/23 101/17 sites [2] 61/5 94/25 sort [4] 61/21 64/22 153/6153/8 seven [1] 34/20 sits [1] 50/5 sought [5] 6/22 43/15 6o/5 61/8 152!15 Seventh [1] 104/6 sitting [2] 12/6 66/7 sounds [1] 64/2 several [5] 94/4102/21104/23105/5150/8 situation [3] 67/24123/23 145/23 source [1] 41/13 severers [1] 66/13 si:< [2] 26/2 36/18 South [1] 156/6 shall [2] 79/19 88/2 Sixth [2] 102/5 104/1 space [1] 64/14 shameless [2] 5/1 5/1 skip [3] 98/8 100/9 106/1 spade [3] 94/13 135/24147/18 she [53] 8/14 8/1410/5 10/5 45/18 45/22 skipping [1] 12/14 span [2] 41/9 41/11 51/13 51/14 51/14 51/15 52/12 52/17 52/21 slows [1] 75/8 speak [4] 44/2151/6 146/20158/24 66/23 66/25 104/18 105/23 106/1106/6 smacks [1] 50/3 speaking [3] 4/5 35/14 38/7 109/22110/11111/6 111/8 112/21113/16 114/2 small [8] 56/9 56/13 56/17 75/2175/22 Special [12] 7/13 20/20 25/1 30/2 30/11 114/3115/4116/13116/15116/15116/17 109/19 109/19 147/13 37/10 77/10 77/20 78/8 78/18 91/25117/3 116/18 116/19117/16117/17117/24122/18 smart [1] 124/5 specific [22] 8/5 12/712/1515/5 35/22 122/25 123/10 123/15 124/9 124/21125/10 SMR [1] 53/11 35/24 43/3 45/13 71/9 77/1 83/11 83/12 125/11134/25135/8142/3143/2143/4147/5 snapshot [2] 22/14 23/18 114/20 118/5127/13 129/23 138/19 138/20 147/8147/9 so [1sol 5/13 6/5 7/17 8/22 9/15 10!15 1o/22 148/15 149/15 149/16 153/2 she's [5] 10/2 67!1112/20 121/7124/9 11/2 11/2412/22 16/23 18/25 20/12 21/19 specifically [20] 10/15 10/1713/1136/17 sheet [3] 6/1415/25 161/13 23/22 23/25 24/7 24/17 24/18 24/22 24/24 39/3 47/10 74/10 79/16 80/10 83/6 83/7 sheets [1] 27/9 24/24 26/4 26/20 26/25 29/19 31/6 31/13 89/21107/2115/4116/16118/9125/6143/6 shell [1] 61/3 31/23 31/25 32/5 32/13 33/19 34/4 34/8 147/5161/8 shift [1] 65/16 34/20 35/3 35/6 35/9 36/1136/23 37/9 speed [1] 7/10 ship [1] 22/7 37/10 43/6 44/19 44/23 46/6 46/18 51/6 split [3] 145/9 145/12 146/7 Shop [1] 72/15 51/16 52/153/23 54/17 57/13 57/15 57/23 spoken [1] 33/16 short [4] 23/2154!2 76/1147/25 58/25 59/6 63/1164!7 65/10 65/2166/4 sponsored [1] 85/22 shot [4] 153/18 154/8 154/9 155/16 68/23 70/2 70/3 71/6 73/7 74/19 75/2 76/1 spread [1] 136/7 shots [1] 155/14 76/8 76/14 78/10 78/1180/9 80/20 83/4 spreads [1] 135/16 should [19] 25/18 25/19 31/8 32/8 41/8 83/5 83/8 83/2184/20 94/12 94/14 95/2 spreadsheet [5] 148/4148/17148/18 51/22 67/15 71/13 74/12 94/23108/10115/17 96/13 98/15 98/22 103/13 103/25 104/21 150/18 151/1 131/5142/20 144/2 150/17152/13 152/16 104/21105/2105/7107/25 108/22109/23 sprung [1] 38/15 154/21 110/15 111/13 111/14112/2 112/8 113/10 stack [1] 95/20 shouldn't [6] 70/24119/2124/3 150/24 113/19114/10115/11115/12116/24117/20 stage [2] 65/10 67/8 152/13 158/11 118/19 118/25 120/6 120/12 121/8 124/21 stamina [1] 161/21 show [34] 9/1614/1414/2417/10 22/20 126/24 128/24130/1130/3 130/7130/16 stand [6] 21/23 26/2o 42/23 43/12 75/9 26/6 28/13 59/19 60/4 61/19 62/1162/16 133/2133/10133/12133/23 134/11134/21 121/20 65/5 67/9 68/18 79/8 84/12 85/14105123 137/1137/12138/7138/7139/12139/25141/4 standard [23] 62/5 62/12 62/17 62/24 106/23 110/3 112/18 115/2115/8 117/19 141/23 145/1145/22 148/24154/2154/22 64/18 65/4 65!12 66/5 67/4 71!14 71!22 119!2o 148/6151/2151/19154/7155/4155/14 155/1156/13157/7157/19158/7158/24159/7 72/18 73/8 81/10 81/11 81/17 81/19 98/25 155/16 155/16 160/2160/5 161/11 99/24100/2150/4154/25161/7 showed [7] 83/16 98/15 98/16 98/20 So at [1] 20/12 standards [12] 61/10 61/12 61/14 66/17 105/20 106/2 113/22 Social [4] 77/2177/22 77/24115/5 68/17 69/13 69/25 72/7 72/12 72/13 72/22 showing [7] 13/2514/17 59/3 59/8 60/10 Softech [1] 67/22 73/7

1072 s substantial [2] 34/17 90/13 substantially [1] 131/17 tardiness [1] 91/7 tardy [2] 76j2o 76/23 standing [3] 34/4 95/9 95/12 substantive [1] 157/22 targeted [2] 83/6 88/24 start [10] 4/7 4/16 25/25 32/8 54/22 66/25 such [4] 36/11 59/13 86/24 87/14 technical [2] 35/16 157/1 74/22 97/12132/4139/11 sudden [1] 26j21 Tecum [1] 94/1 started [7] 9/2210/5 26j2 26j8 26j12 26j12 suddenly [1] 50/24 Telephone [6] 2/6 2/14 2/213/6 3/12 26/13 sued [4] 62/1 63/12 67/17 68j12 163/22 starting [4] 41/17 45/24 93/7102/23 sufficient [2] 105/6 132j2o tell [35] 6/13 21/9 26/15 28/23 31/3 41/17 starts [2] 26j7110j10 suggest [5] 6/2 34/12 38/24 93/8127/14 45/2155/10 64/2 65/2174/16 79/10 86/20 state [13] 14/114/4 31/9 47/15 47/18 70/9 suggested [2] 109/10 126/16 90/2 115j2o 116/9 116j10 119j2o 119/23 70/16113/5133/4133/21134/5163/1163/5 suggesting [5] 16/2518/11 25/15 44/6 134/9 134/25 141/3 141/23 141/24142/2 stated [4] 11/2 51/14 117/14 139/18 64/10 145/24145/24148/1148/21149/17150/21 statement [3] 55/155/4125/23 suggestion [5] 116/17116/20 120/14124/16 153/6 158/9 160/25 161/13 statements [7] 15/5 57/22102/8117/16 126/13 telling [7] 15/3 57/13 57/23 85/16 87/25 119/1119/1120/7 suggests [2] 64/24 118/22 117/6154/14 states [1] 88/22 suit [1] 97/18 tells [1] 44/4 stating [1] 118/21 Suite [4] 2/5 2j2o 3/5 3/11 template [2] 17/2318/5 statute [5] 65/2466/19 71/8 72/173/5 sum [1] 55/12 Temporary [7] 95/25 98/19 102/3 102j22 statutes [1] 61j13 summarizes [1] 12j22 103/1108/6118/2 statutory [3] 64/24 67/19 68j21 summary [7] 12j18 29/14 29/16 29/20 ten [3] 128/8 128j20 136/17 stay [2] 33/25156/9 29/25 30/22108/4 tends [1] 128j9 stealing [2] 55/17 69/20 summer [4] 96/1158/16 159/1159/2 tennis [1] 132/19 STECKER [1] 2/11 summertime [1] 158/18 tens [4] 39/15 39/18 40/20145/20 stenotype [1] 1j21 superceding [1] 61j21 term [5] 23/11143/15 143j21145/14 148/17 step [1] 19/7 superior [1] 135/22 terminated [1] 117/6 steps [1] 68/14 supplement [3] 89/11 89/12 141j21 terms [53] 8/12 10j618j2118j25 19/2 Steve [1] 113/23 Supplemental [3] 88/16 89/21140/22 23j16 29/24 106j14 106/15 112/2 116/3 Steven [3] 40/7113/14 113/16 supplementation [2] 14/9 8o/8 125/15125/16126/8126/9126/9127/10 stick [1] 59/24 supplemented [2] 8oj6 90/2 129/5 131/21131/22142/2 142/11142/16 stickY [1] 82/1 supplementing [1] 99/17 142/17142/19142/21143/5 143/5 143/6 still [17] 8/25 9/1619/20 24/6 25/17 35/14 support [7] 67/167/3 73/24117/16118/25 143/11143/20 143/25 144/8 144/10 144/11 41/12 66/22 67/175/9 105/5 129/14140/16 120/25128/9 144/16 144/22145/1145/9 145/13 145/18 150/18 151/7156/14 156/15 supported [1] 104/2 145/21146/1146/7146/8 148/12148/25 stipulate [3] 25/13 25j16 96/1 supporting [1] 8/20 149/15153/2153/4154/10154/11155/4 stipulation [2] 66/21 72/24 supports [1] 122j23 test [1] 127/5 stole [1] 16/10 suppose [1] 161/7 testified [8] 27j2o 27/23 38/20 40/6 50/13 stolen [1] 15/3 supposed [5] 7/6 20/11 20/16 20/20 71/7 59/25 68/18 148/9 stop [6] 10j18 47/8 57/12 65j18114j22 supposedly [1] 22/3 testify [1] 49/22 120/15 supposition [1] 29j12 testimony [16] 27/6 39/25 39/25 61/15 stopped [2] 8/1410/19 sure [31] 8/2412/1717/19 21/18 28/3 36/1 63/24 64/12 64/20 65/7 80/24 82/20 83/11 store [6] 40/14 81/9 83/13 131/13 148/11 44/19 44/23 55/15 57/8 62/25 64/16 70/6 83/16 94/9 148/7149/10 149/13 149/1 75/5 75/19 81/2192/19 93/25112/9 120/8 TEXAS [69] 1/71/8 1/10 1j10 1j2o 2/5 3/5 stores [3] 13/1147/11149/6 121/2130/18 130/23 131/8138/10 140/25 3/12 13/1114/114/1715/6 30/22 37/18 37/24 story [1] 91j16 148/4 153/17 154/2 156/13 160/14 46/17 47/7 47/1147/15 47/20 48/16 48/25 straight [3] 6/9 102/8 102j18 surprised [1] 161/23 49/19 50/7 51/18 53/10 57/4 57/4 59/22 straight-forward [1] 6/9 surrounding [1] 60/11 61/12 63/13 65/1170/9 72/8 72/1179/20 strapping [1] 156/6 suspect [1] 118/23 79/20 80/23 82/7 82/8 86/6 86/8 86/12 strategies [1] 83/9 SUTHERLAND [1] 2/4 89/19 95/14 96/6 97/17 97/23 99/199/25 strategy [13] 17/8 79/25 80/5 80/1184/4 sutherland.com [1] 2/7 102/21104/7 104/14113/6113/19 114/8 123/6 86/4 87/3 87/9 87/10 87/14 87/2188/5 88/8 switch [1] 160/5 123/9124/7133/2133/4133/24135/2159/20 Street [1] 2j12 sworn [3] 13/10107/2 124/9 163/1163/5 163/19 163/20 163/21 system.~3~)8/ 1l,38/22 71/3 streets [1] 68/3 text [11] 139j12 139/17 141j1o 141!13 146/21 strike [1] 13/6 sustemtc 1 '7c:: 146/23147/2147/5147/7147/10147/14 structure [2] 52/6 52/8 than [10] 8/5 57/20 76/21 76j22 76/23 struggled [1] 72/9 T 91/25101/5116/4117/7137/18 stuck [1] 136/3 tagged [1] 54/21 Thank [30] 18/137/142/19 45/17 48/23 stuff [11] 30j1o 38/25 47/6 84/3 84/4 86/5 tailor [1] 117/14 54/7 58/3 6oj15 6oj16 72/3 73/25 79/14 87/5 99/6 99/6148/8 148/13 149/10 take [34] 14/7 28/6 28/8 29j2o 30/2 30/3 92/16101/6103/6132/14136/22137/8 stuffed [1] 85/9 39/14 39/15 41/24 46/19 51/23 53/24 59/24 137/13146/15147/18147/18152/7154/13 stuffing [1] 55/16 64/9 75/4 89/1190/6 90/17 91/5 91/8 96/24 155/20 155/21155/24160/19160/21 styled [1] 163/9 101/5101/12117/25118/1120/19128/8128/9 Thanksgiving [1] 158/1 subject [5] 25/10 55/14 62j8 63/14132/2 132/18139/8146/16159/4159/5 161/25 that [1247] submission [1] 92/24 taken [6] 25/6 27/170/13 81/7 97/2109/6 that reasonable [1] 33/3 submit [1] 42/5 takes [2] 121j13 146/17 that's [146] 5/10 5/24 9/1310/3 10/1411/5 submitted [10] 41j2o 53/24 77/13 102/24 taking [6] 28/5 29!24 53/1 57/8 68/14 n/511j814/23 15/1715/1816/1217/1119;5 105/11108/2 118/19 118/20 120j12 159/13 69/19 20/25 21/5 22/7 23/6 23/7 24/11 25/1126/24 subpoena [5] 93/7 94/196/4 99/2100/19 talk [9] 26/10 35/21 61/20134/8 135/12 27/5 28/10 28/1129/25 30/730/25 31/131/2 subpoenas [9] 93/2 93/5 93/16 94/4 94/5 146/2146/14155/12160/15 32/22 33/5 36/14 36/2136/22 37/23 39/10 96/1197/5 99/25147/16 talked [4] 33/14 50/14 50/14 70/13 40/141/16 41/16 41/20 41/2142/15 43/11 Subsection [1] 63/4 talking [26] 13/7 27/3 29/25 32/24 39/15 43/19 45/14 45/25 46/13 46/2146/2148/8 subsequent [1] 117/3 43/2 44/14 45/24 49/3 52/12 57/19 61/23 51/151/4 53/3 53/5 53/6 53/7 54/154/25 subsequently [1] 28/16 67/21 69/3 78/3 79/9 86/3 89/5 93/3 93/12 55/7 55/7 55/18 56/10 56/14 56/18 57/11 substance [1] 42/16 101/20121/17130/9 136/19 144/23 154/8 57/18 58/18 59/9 59!12 59/12 6of3 62!2

1073 149/10 149/13 156/12 69/18 73/13 75/175/6 77/13 83/1183/25 T therefore [4] 89/1105/21105/25150/3 85/13 86/7 86/1193/6 93/17 94/15 95/19 that's ••• [73] 62/17 63/5 64/3 64/8 64/17 therein [1] 144/3 95/22 96/10 96/15 97/13 97/17 97/22 98/21 66/8 67/23 68/16 70/19 70/24 71/13 71/20 therein lies [1] 144/3 99/12 100/19 101/23 103/3 103/7103/7 71/21 71/2172/8 72/14 73/12 73/13 73/21 these [127] 5/I18/510j2o 11/311/512/24 103/11103/22 104/3 104/14104/16104/21 75/22 75/22 77/22 79/23 8oj8 81j12 81j12 16/2118/14 23/20 29/17 36/18 40/8 42/1 105/1106/14106/20 111/20111/20 111/22 82j1 84/7 85/4 87/16 90!11 90!15 91!24 92/8 46/5 51/1157/22 61/14 61!19 61/2162!11 111/22112/4112/5117/18120/12121/16 92/15 97/7 98/25 99/2100/20 101/21104/25 63/6 65/9 67/11 69/2169/24 70/170/2 70/3 122/12122/16122/16122/21127/3127/22 107/1109/23 111/5112/8 112/22 113/19 70/4 71/25 72/24 73/12 74/17 77/4 78/23 128/19 129/2129/7131/12 131/21133/10 114/18116/21117/2117/2118/14ll9/4119/11 81/5 81/20 82/6 82/14 82/19 83/6 83/6 133/16135/17136/2 138/22 139/2 140/8 125/2126/8127/25131/16135/5135/23 83/24 85/18 90/18 90/20 90/23 91/ll91/19 142/19 143/5 143/18 146/16146/17146/25 136/1136/7136/8 147/9 147/10 147/14148/6 94/14 95/3 95/10 95/25 96/2 97/18 97/22 147/4149/8149/11149/12149/16150/3 149/25152/4155/8155/22157/19160/4 99/14 99/23103/10103/13103/14104/4 152/25 155/9 157/5 160/3 160/3 the core [1] 70/15 104/10 104/24105/16 105/18 105/18 106/16 though [11] 39/19 47/16 66/4 88/15 90/4 theft [2] 37/24 66/10 106/16108/4108j8111/6111j18111/24 109/14110/10139/21143/15149/24150/15 their [116] 7/18 8/9 9/4 9/18 10/110/13 112/25115/15116/5117/19119/1120/9120/11 thought [9] 11/2013/17 34/3 63/17 64/9 11/9 11/10 13/12 14/1114/14 15/1216/9 16/9 120/15 120/18 120/23 121/13 121/14122/23 65/8 92/8 102j14 133/18 19/14 19j18 21/5 21/1122/14 24/10 24/14 122/23126/19127/1127/1127/6127/18128/8 thousand [9] 57/20 58/16 59/7 6oj2o 24/14 25/14 25/15 25/17 25/19 27/6 27/13 128/11128/15128/20 129/1129/6129/6 82!22 85/4 86/24 89!8109/16 28/13 31/5 36/3 37/9 37/24 39/19 39/21 129/10129/13 129/18 130/5 130/10 131/23 thousands [4] 39/16 39/18 40/21115/23 40/19 41/2 41/3 41/5 41/13 42/1142/13 43/10 132/2 134/17135/19135/20 135/24136/10 three [15] 6j210j1238/6 52/24 77/177/4 46/8 46/13 47/2 47/9 47/17 48/148/5 48/5 138/2139/10140/11142/4142/6142/18 81/24 92/12 93/15 96/9111/19112/4118/7 48/5 51!10 51!10 53/9 53/18 54/155/11 57/1 143/8143/14143/22145/1145/4146/21 121/4 152/18 57/157/5 59/14 63/163/9 64/7 66/166/1 147/24152/18160/22 through [31] 13/2 16/117/16 28/7 32/20 66/7 66/11 66/18 66j2o 70/4 75/20 84j12 they [361] 34/13 37/18 39/17 40/20 47/9 47/14 54/5 90/13 90/18 91/15 96/3 96/15 98/22 99/17 they're [36] 13/9 13/23 13/25 14/1316/25 59/1 82/9 82/23 83/11 95/22 96/17100/9 100/12 102/17105/12105/20 106/11108/17 18/2s 24/7 24/1125/1125/15 28/s 38/4 40!2 106/9106/20106/22 109/15 119/3 120/9 109/11111/23112/3 112/24 121/15 122/15 40/18 42/1142/13 42/15 51/19 52/2 59/14 127/9 135/4138/21139/10142/3143/5 123/14128/14129/4131/16137/9138/4 61/23 64/5 66/2 68/23 69/6 70/19 71/7 71/24 throughout [1] 133/3 138/6141/1142/2143/4143/19145/11146/1 71/25 72/177/1110/15145/11147/15147/15 throw [3] 70/20 71/17 71/20 146/8146/25147/2147/16150/2152/19 149/5 throwing [1] 115/23 154/21154/23 157/3 160/7 they've [16] 13/10 16/13 16/2419/16 41/18 thus [2] 7/1411/1 theirs [4] 31j12 39/15 66j2o 73/11 49/7 57/24 80/10 87/8 97/17 97/22 98/23 TI [5] 101/24 105/13 105/13 105/14 122/13 them [118] 5/15 9/15 9/17 9/1710/710/8 112/4117/20142/24149/4 till [2] 23/22 128/6 10/1112/714/8 14/1414/20 15/5 15/8 15/19 thing [15] 6/16 21/2128/2 31/2 34/7 43/6 time [68] 6/615/5 16/13 20/5 21/10 22/14 16/216/816/1216/1216/1317/319/1419/18 45/5 60/17 64/22 84/1187/2 95/11116/14 23/17 23/18 24/4 24/9 26/6 29/19 31/14 32/9 21/17 26/2 27/10 27/2128/12 30/9 31/11 151/12 153/15 32/22 33/4 36/1141/9 41/1150/10 55/24 31/13 36/2137/6 37/12 38/16 40/10 40/25 things [30] 8/s 13j6 25/9 25j12 52j11 83j12 57/21 69/13 69/24 72/7 74/24 75/11 76/7 41/10 41/15 44/22 45/16 55/19 56/19 64/7 83/13 90/8 90/10 90/18 90/20 90/20 91/7 78!6 78/12 8o/3 8s/s 91/s 91!6 91!9 96/19 64/8 67/12 70/15 71/8 73/4 73/1177/9 77/15 91/15 91/19 92/1195/10 106/14112/25118/21 101/22 101/24104/25106/9 109/3 111/3 77/16 78/14 78/16 78/18 80/9 80/17 81/25 126/5 127!12 128/10 139/17140/11142/18 111/22 119/4 119/13 121/10 121/13 128/15 83/3 86/20 87/21 87/25 89/13 89/20 91/21 154/16 154/19 155/1157/23 128/16129/3 129/7129/12130/4130/6 91/23 93/2 94/15 95/4 99/23 10S/ll106/13 think [95] s/10 S/13 S/23 S/24 6/4 6/s 6/7 130/16130/21133/4134/1134/5138/9 106/13 106/23 107/13 109/16109/17110/3 7/9 7/118/19/9 9/2111/1512/1412/1815/23 138/12138/13147/11153/16157/22158/19 113j2o 117/6118/14126/16129/24129/25 16/616/1817/1317/14 20/2 20/4 22/12 23/9 158/24 161/20 130/15 131j22 132/1135/25 136/9 136/11 25/2126/8 26/24 28/10 28/12 30/4 31/8 times [7] 8j2o 11j6 32/6 42/21124/2154/3 137/1137/2137/4137/11141/24142/2144/23 31/13 31/25 32/8 32/2133/16 33/20 35/23 157/18 146/13 147/2 149/1149/12149/13 151/3 151/9 35/24 39/9 39/2139/22 39/25 40/14 40/15 timing [1] 31/21 1S1/ll152/16 152/17153/11153/23 155/2 40/22 42/8 42/1143/1144/144/4 44/25 46/7 tiniest [2] 90/8 90/10 155/14 155/16 155/16 157/3 157/19 161/1161/1 49/9 51/25 57/18 65/21 66/13 67/16 68/16 tink [1] 138/9 161/10 69/18 75!12 8s/23 89/16 90/3 92!23 93/1o TIO [8] 104/14111/6111/20 121j1126j15 them data [1] 67/12 99/5 99/20 112/3 112/22 121/6 124/18 126/8 126/21128/16 128/17 them down [1] 89/13 126/10127/25129/14129/18 136/16136/23 title [6] 1/5 1/5 1/7 79/2188/3 88/25 themselves [5] 31/18 51/10 51/10 129j18 137/ll137 /11138/14 140/19 141/15 145/11 titled [1] 1/18 158/22 145/15145/22145/22146/4149/16158/23 TITLEMAX [So] 1/10 20/18 22/10 23/1 then [74] 4/5 6/3 9/1410/12 16/10 25/2 159/13 161/7161/9 24/10 24/13 24/14 24/23 25/8 25/12 25/13 26/2 26/21 28/7 28/7 28/16 29/18 30/8 30/9 think what [1] 136/23 27/8 27/10 27/19 27/22 28/6 28/7 28/9 30/12 31/17 32/9 32/14 33/7 34/9 34/13 thinking [2] 93/6 149/23 28/15 28/16 29/18 38/18 38/18 39/5 39/5 34/14 34/2135/10 35/2138/9 40/9 43/12 thinks [1] 108j12 41/5 41/14 49/158/9 59/17 59/22 63/25 66/1 49/3 49/23 s1/22 58/22 6o/9 63/7 64!21 third [21] 5/20 60/23 61/5 65/24 72/16 66/7 70/7 78/10 79/19 79/20 82/12 82/13 68j12 68j21 73/2 83/23 8s/3 88j12 90!11 72j21 73/5 73!12 82/13 82/1s 8s/5 88/25 8s/1194/9 97/19 98/14 98/2o 1o1/19 102!19 91/7 93/16 93/16 98/25100/9 100/10 111j16 93/194/6 96/10 99/2 99/23100/3 100/19 102/24103/1103/12 103/15104/1104/11 113/4I14/8114/9115/16119/2121/1121/9 101/16 134/7 105/17106/24107/81o7/221o8/5108/21 122/18 125/11125/17126/10 126/17127/24 third-party [7] 73/5 88/25 93/194/6 96/10 108/23 108/25109/13 109/14110/1110/7 128/9 132/8 132/8 134/25 137/20 146/7 99/2134/7 110/9112/17112/19114/2117/20121/16 146/12147/16152/20153/18157/2157/5 this [441] 121/17122/24123/25 129/3 130/22 131/13 theory [6] 13j16 24j1o 55/18 100j9 135/3 Thomas [3] 48/149/2 57/11 131/14139/16149/25 135/5 those [123] 5/22 6/5 8/10 9/10 13j2 13/14 TitleMax's [5] 65/16 106!7120/5 133/22 there [185] 15/715/1617/2018/2018/2118/2519/119/1 154/24 there's [28] 11/3 22/7 27/5 39/22 42/8 19/13 19/17 20/19 20/19 21/10 21/16 25/12 TMX [6o] 1/91/91/10 4/2 41/5 45/8 46/3 48/4 48/20 51/17 55/10 56/4 59/1160/10 26/127!8 27!24 29j1s 36/s 38/20 40!1 47/2 47/4 47/5 47/10 47/10 47/17 47/19 73/24 75/22 77/2177/23 84/18 93/5 96/13 40/10 44/24 49/17 49/20 49/22 50/18 57/10 47/23 48/8 48/9 48/10 48/25 51/4 51/22 99/16 106/13 114/17116/11136/17142/10 s8/16 61/4 63/23 64/8 64/18 6s/s 6s/8 67/9 51/23 51/24 52/153/3 53/3 53/6 53/6 53/9

1074 129/16 131/17146/14159/4159/4 upper [1] 113/24 T trying [19] 64/5 64/6 64/7 93/12 93/18 ups [1] 136/1 TMX •.• [31] 53/18 54/18 54/23 54/23 55/4 97/12108/3 111/11111/16 112/7117/24119/9 us [77l 7/2 9/14 9/22 to/6 13/12 14/25 17/15 55/6 55/8 55/8 55/9 56/10 59/16 59/18 119/19 134/6 134/6135/18136/8144/20 21/9 21/14 25/18 25/19 26/128/14 30/3 30/8 59/20 59/20 59/21 87/10 89/17 90/24 91/18 146/6 32/12 36/21 36/22 37/1139/12 39/19 40/17 104/8107/22108/19119/11119/24119/25 turn [14] 12(23 50/1159/13 62/6 62/23 40/20 40/20 40/22 40/22 41/17 42/25 43/4 120/2123/11123/11124/8 125/17126/10 63/16 63/22 64!21113/15113/18116/2116/4 48/8 52/16 52j18 52j22 6o/8 66/9 66/9 to give [1] 61/1 144/12 148/12 66/15 69/7 72/9 77/1177/12 78/12 80/11 to her [1] 160/16 turned [8] 98/14 103/21105/25 117/to 84/18 85/10 86/24 87/8 91/4 97!12 98/22 today [12] 21/15 26j2131/2 32/14 33/11 119/22132/2137/9 137/10 99/8 100/11102/19 104/12 106/9 106/20 34/8 45/165/2 73/23 107/17123/1156/25 turnover [1] 78/10 106/22109/6110/22111/12 112/6 112/7 today's [1] 26/25 turns [4] 111/14 132/7 132/8 143/15 120/17121/16126/17133/19 134/9 134/9 Todd [1] 148/9 twisted [1] 119/13 134/15134/19134/20 138/1138/14145/9 together [3] 19/3 121/11154/4 two [31] 5/17 5/19 10/12 12/14 24j2125/11 145/15 150/20 153/25 told [22] 4/24to/8to/to 43/4 50/12 54/15 38/6 38/9 38/16 38/2o 40/9 52/to 74/9 81/5 USC[t] 63/2 59/25 60/7 78/16 78/18 84/4 91/21 91/23 92/12 97/18 99/18 101/12101/21102/17 use [21] 43/to 63/4 63/6 64/174/14 87/11 96/22 106/13 134/15 140/14148/21149/1 104/24133/4140/4149/5149/8149/21 94/24 96/2 98/9 108/8 129/6136/6139/18 149/12 153/14 157/3 154/16155/1155/2159/20 161/11 141/1142/11144/10 144/10 146/1146/8 tongue [1] 119/13 two-year [1] 133/4 146I 25 153! 6 too [12] 53/1 69/15 69/25 75/3 75/22 84/13 type [7] 14!2115/7 30j2o 38/5 94/6 134/16 used [22] 23/9 27/8 61/25 79/22 81/to 82/9 104/4to7/1122/2157/8158/4158!5 138/3 88/4 89/196/4103/18112/2129/5131/23 took [2] 51/13 97/2 tool [1] 153/7 types tvnicallvr':-f7 [3~ 2 81~Jt:\~~4/17 01 2 142/2142/6142/11142/21143/2143/11 143/12 145/1145/19 top [6] 51/454/256/3113/2115/8139/11 topic [1] 49/to u uses [1] 63/5 using [19] 27/9 66/25 71/8 75/3 79/25 80/3 tort [1] 73/20 Uh [1] 81j16 8o/5 87/9 88/5 88/8 97/21103/21125/22 tortfeasor [1] 73/20 Uh-huh [1] 81/16 131/21134/10142/21144/8 144/12 153/2 ultimate [1] 61/23 usual [':~ 4o/:/J.0/2 tortious [3] 7/24 16j24 96/20 tortiously [1] 8/4 ultimately [2] 62/11 62j12 usuallv 1 -=t8 21 total [3] 55/13 96/13 163/14 totally [1] 117/22 unable [1] 138/6 unacceptable [1] 36/14 v touch [1] 25/11 uncover [1] 142/18 vacation [7] 158/10 158/12159/5 159/5 touched [1] 126/22 under [19] 24/10 29/16 41/19 49/19 58/14 160/4 160/7 160/18 tough [1] 41/21 61/24 72/13 91/8 93/7 95/14 98/1 99/199/24 value [1] 21/19 toward [1] 94/6 100/2106/6114/6135/3154/21157/4 various [2] 70/4 94/3 towards [2] 83/7109/25 underlying [1] 30/9 vehemently [1] 49/9 tracing [3] 98/8to0/9 106/1 understand[17] 5/615/13 22/19 29/7 35/9 vehicle [3] 47/15 110/13 117/23 track [1] 38/17 45/2 45/8 51/17 58/8 78/16 86/192/1129/9 vehicles [2] 114/8 117/25 tracked [1] 68/9 130/16 132/11147/12 147/13 vendor [1] 70/1 tracks [1] 53/14 understanding [5] 76/10 100j18 104/9 vendors [1] 70/2 Tracy [22] 45/6 45/14 46/16 47/23 48/10 113/11137/18 veracity [1] 57/22 48/14 48/18 52/14 53/5 53/8 55/15 56/156/7 Understood [11] 8/6 33/2 33/13 38/8 42/5 verbiage [1] 82/16 56/to 56/10 56/13 57/2 57/6 57/7 57/11 74/1 89/10 128/21128/23136/25142/1 verify [1] 120/7 58/22 58/23 undisputed [5] 53/3 53/5 53/6 53/7 73/13 Verizon [1] 147/16 trade [3] 42/10 42/14 42/18 Unfortunately [3] 84/18110/2158/4 verse [1] 49/11 traded [t] 136/5 unilateral [1] 129/3 version [1] 87/17 trafficking [1] 38/13 Unitech [1] 62/6 versus [1] 144/12 trail [11] 105/19106/2106/4106/5107/2 universe [4] 10/23 83/3 95/2143/4 very [43] 6/9 8/23 8/25 20/22 26/4 33/22 117/8 119/17124/3124/4125/14126/7 unless [8] 7/25 33/24 35/4 68/20 95/2 41/4 44/21 45/17 48/17 49/23 52/11 54/2 trails [1] 156/9 101/12 144/14 152/4 56/3 56/23 75/15 85/1194/16 94/19 98/17 transaction [3] 18/5 40/9 40/13 unlike [1] 149!13 102/16102/18 102/18103/25 103/25 104/11 transactions [1] 40/to unlikely [1] 143/16 105/23 108/16 109/19 111/10 111/12 111/12 transcript [2] 85/25 97/2 unrelated [1] 71/15 114/20125/24137/16140/25143/21153/15 transcription [1] 163/6 until [5] 19j1o 35/23 35/23 36/1191/19 155/21155/24158/3 158/21160/21 transcripts [1] 84/23 unusual [1] 50/15 view [3] 41/19 46/6 110j21 TRAURIG [1] 3/to up [84] 7/to 9/25 16/1117/16 18/14 21/23 Vin [6] 48/157/11108/to 110/6110/10 treat [1] 51/1o 24/8 25/8 30/12 31/14 31/18 34/8 35/18 110/12 treated [1] 67/17 35/19 37/2 37/19 43/2o 44/22 58/6 64/8 violate [1] 111/6 treatment [2] 42/25 44/8 64/25 68/9 68/to 68/12 68/13 97/3 98/11 violated [4] 66/5 111/8 112/25 121/1 trial [34] 1/3 9/2018/13 28/1 28/6 28/25 98/14 99/7 99/10 101/12 102/23 104/22 violater [1] 121/8 29/19 30/5 31/17 32/10 32/11 33/8 33/8 34/9 105/20 105/25 106/23 108/17108/17108/19 violates [2] 61/10 62/5 34/12 34/13 34/15 34/18 34/21 34/21 43/10 109/9 110/15 110/17111/15 111/19 112/9 violating [3] 102/3 104/15113/20 43/19 43/20 44/15 44/18 44/19 44/22157/20 113/13115/8116/2116/4116/17116/19117/to violation [6] 101/23 111/12 118/2 126j15 158/8 158/9 158/19 158/20 159/11159/19 119/22 122/19 123/21123/24124/24125/3 126/21132/6 trials [1] 158/6 132/2 132/7132/8 134/10 134/20 137/9 Virginia [4] 82/2 82/12 86/5 86/9 tried [4] 23/16140/6 150/2o 156/10 137/10140/8 140/9140/10143/15144/12 virtually [1] 82/16 TRO [4] 6/25 7/15 21/23 22/14 145/6145/7145/16 146/1146/9 148/12 visual [1] 61/1 trouble [1] 121/to 153/10 154/9 154/15 154/16 154/22 155/1 volume [5] 1/213/213/1144/14163/8 true [5] 64/6 64/16 94/5 112/22 163/6 155/15 159/5 VOLUMES [1] 1/2 truly [2] 75/8 163/12 update [2] 32/10 109/11 voluminou,; f2l '20/u qof2q truth [1] 160/24 try [17] 52/17 68/1 68/7 77/18 83(11 97/9 updated [3] 76/4 84/184/3 upon [11] 7/19 10/2014/5 15/2 18/22 18/24 w 11o/8 117!25118/18 12o/22 126/5 126/18 84/23 134/17145/20145/22150/22 wait [22] 16/1517/217/2119/22 27/14 28/1

1075 w 108/18115/2120/4122/3124/11125/6 125/24129/1129/2 129/7130/25 131/6 94/13 94/16 94/25 95/2195/2196/12 97/10 98/8 101/22104/24108/3 109/10 110/7 wait••• [161 31/4 36/1152/19 52/19 52/19 133/20137/5137/20140/19144/9146/22 111/13113/22129/10130/23131/4131/13 54/18 67/6 99/9 99/9 110/16110/16110/16 147/12151/21151/25154/2154/4156/13 133/13 141/15 149/6 149/21149/22152/21 110/16 122/5 136/24140/1 157/14158/11159/23 160/16161/15 161/22 153/3 154/6158/18 158/20 159/17161/25 waited [11 101/8 WEUBHIRE [21 1/5 4/2 163/9 waiting [31 10/7 35/7 37/3 went [161 8/14 25/7 28/7 28/15 28/16 37/19 whichever [11 34/8 want [741 4/5 5/25 6/2011/1612/414/24 42!2157/6 68/5 68/7 94/1o 103/23106/3 while [71 40/1 72/10 76/18 82/24 83/5 14/2415/115/1915/1916/2119/419/5 27/16 134/1148/17149/18 131/13 132/18 28/3 28/10 30/3 30/3 30/8 32/6 33/2134/2 were [1531 7/115/3 16/718/20 18/20 20/17 White [11 110/12 40/20 42/3 42/12 52/10 59/24 60/18 60/19 2o/18 2o/19 21!10 22!13 22!17 23!8 36/5 whiz [11 71/1 66/5 66/18 68/25 74/5 74/19 85/23 86/6 37/2 39/14 40/6 41/19 42/149/16 49/20 who [851 4/22 15/20 17/24 20/17 20/18 87/19 87/2187/25 89/12 90/4 92/13 99/7 49/22 50/12 50/15 52/17 59/25 59/25 60/1 21/3 21/3 22/13 22/17 22/20 24/19 27/12 101/12 104/21106/9 106/19 106/20106/22 61/16 63/17 63/17 63/25 64/6 64/1167/18 27/19 40/6 40/13 42/142/2 45/8 47/22 111/13117/4119/5119/20124/11128/5128/7 69/6 73/13 77/8 77/9 79/2180/4 80/15 80/17 47/25 48/12 50/25 51/12 51/13 51/14 53/1 129/4133/3134/23135/1136/10136/16 80/23 81/8 81/8 81/2182/19 83/2 83/7 55/18 56/10 56/12 57/3 61/5 61/7 61/16 61/25 139/12 144/1144/10 144/10 145/2 149/15 83/13 84/14 85/9 86/3 86/6.86/12 88/3 62/8 62/9 66/1168/8 68/12 68/12 69/18 151/14 151/21155/8 158/23 159/3 159/4 88/24 89/1 89/2 89/4 89/5 90/23 93/15 94/5 69/23 70j2o 70/22 79/2180/3 8oj118oj17 wanted [51 45/1 65/19 65/19 95/3 144/6 94/17 95/3 95/5 96/4 96/11 97/6 97/14102/3 8o/23 8o/25 81/184/7 84/11 85/3 85/2o wants [21 17/15 40/20 102/20 102/25103/2 103/4103/8 103/8 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161/10 Whenever [11 153/24 42/13 42/17 44/1146/12 49/5 54/19 60/14 we've [401 20/4 30/2 47/6 49/14 49/21 where [491 8/14 9/13 9/14 11/21 13/12 13/21 62/23 63/16 63/22 64/2 69/19 73/173/24 55/8 55/19 61!13 61!15 65/6 65/6 65/7 69/18 21/10 25/2 26/6 26/8 26/9 26/9 26/9 26/11 . 74/16 75/2 75/4 75/5 75/12 75/13 77/18 79/8 78/20 84/1 85/6 94/8 94/12 101/14101!15 26/1126/12 27/6 30/4 30/25 40/8 40/17 79/17 80/9 82/15 83/22 86/22 87/4 88/13 101/15 106/13 106/18 106/18 109/21109/21 49/8 57/7 57/24 57/25 63/1165/6 65/10 91/8 91/16 94/6100/19100/24101/4101/11 112/25117/21120/20121/9121/10122/12 65/12 69/13 69/19 70/13 73/13 75/11 80/18 105/10 106/15 107/18 108/12109/19 111/16 124/3 133/25 134/6 142/17145/1148/1150/6 88/15 89/11 89/15 94/9 101/1123/23 124/2 113/11113/13 117/6 120/15 122/1128/9 150/6 133/10 135/8 138/15 140/2 143/24150/14 129/10 130/1132/8 133/12 135/14 136/4 web [31 61/4 94/10 94/25 158/24 136/10 137/25140/14141/14141/17141/20 website [11 63/10 wherever [11 86/17 141/21142/8 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1076 w 160/8 160/10 160/12 j..:...::__ _ _~---------lYet [7] 7/2210/16 33/17 6oj18113/7113/11 without [7] 17!718/15 2oj2o 111/17136/2 128/5 151/11160/24 yield [2] 7/22 29/19 witness [4] 36/15 49/18 49/18 95/1 you [478] witnesses [2] 94/8 94/9 you a [1] 112/14 won't [13] 30/9 30/14 30/15 44/20 50/18 you'd [2] 71/17 71/20 80/16120/22134/8134/8134/8134/9 you're [57] 5/7 7/4 8/111/2114/1214/13 151/20160/18 14/2015/415/616/1018/3 28/25 29/3 29/20 word [11] 10/3 29/2174/14 92/11136/6 31/3 31/4 35/7 40/25 43/2 45/17 45/24 54/10 142/4143/2153/9153/10 154!19155/7 57/17 57/19 57/23 65/22 66/13 67!15 71/6 Word-of-mouth [1] 136/6 78/23 80/20 83/23 86/23 86/24 90/15 91/15 words [8] 10/2218/7 55/20 75/6111/23 93/3 93/12 99/5113/6115/23 117/10118/3 111/25 133/3 142/5 126j10 130/9 130/17130/23 133/23 140/3 work [19] 12/117/8 27/8 31/13 35/16 37/4 144/22146!2146/4146/4153/22154/14 64/3 94/13 100/11119/3 135/24136/2 136/10 156/7158/20 146/2146/13146!14147/18158/1161/10 you've [13] 14/1418/419/2219/23 20/5 worked [7] 55/18 61/24 78/1131/13134/21 20/6 20/6 35/4119/13122/5142/16152/6 135/11149/8 154/25 working [4] 76/14154/4156/15156/25 you've had [1] 20/6 works [1] 51/17 Young [31] 45/6 45/14 46/16 47/23 47/23 world [1] 97/5 48/10 48/14 48/18 49/2 50/150/3 50/14 would [116] 5/25 6/24 6/25 7/12 7/15 8/6 50/24 52/15 53/5 53/8 56/2 56/7 56/10 56/13 8/9 8/1610/814/2315/1018/618/18 20j11 56/24 57/257/6 57/7 57/12 58!1158/22 2o/17 21!9 21/16 22j12 25!17 28!17 28j2o 58/23 59/3 59/5 6o/10 29/12 29/19 30/13 31/9 32/20 33/6 34/12 your [574] 36/10 39/8 41/6 41/24 41/25 43/143/10 44/7i;,ourseiir;.l t</a 122/8 47/8 49/9 50!23 53/23 54/17 58/5 6o/11 z 61!19 61j21 61!24 64/9 67/9 68/2168/25 F-::-::--,-,-,--,--,---------l 70/6 70/6 71/3 71/19 72/6 72/6 72/14 73/7 zero [3] 68/24 87/9153/19 73/16 75/11 78/18 80/7 84/11 84/16 84/21 ZIP [17] 108/9 110/6 112/21114/9 114/12 86/16 88/13 91/2191/23 93/8 99/25100/25 114/14114/16114/19 114/20114/25 115/19 102/7102j11102/16 106/15 114/11116/3 115/24116/2 116/3 116/12116/13 116/18 116/5 118j1120/6 121j1121j2 121/2125/12 zone [1] 13/6 126/1127/14127/17127/17127/19 127/21 131/22133/5133/11137/3142/11143/21 143/21143/25 144/6 144/12145/3 145/18 147/5148/12150/1151/9151/22153/18156/1 157/9 158/10159/21159/21161/18 161/24 wouldn't [10] 8/7 70/14 70/17 71/2 71/16 74/14 91/1137/10145/4148/21 wrestle [1] 161/1 writing [2] 31/9 163/7 written [3] 6/17 59/4 96/10 wrong [17] 8/139/20 53/12 54/24 57/16 62!15 62j18 62j22 64/11 65/8 68!21 95/24 98/18 98/21106/3 130/14161/25 wrongful [2] 40/19 98/24 wrongfully [1] 98/23 wrot<~'r;;l·-A~l~ ~;;;;:~o/12 118/1A y y'all [12] 26/9 32/6 33/14 40/21 92/11101/1 114!22 118/5 119/7119/7141/19155/11 yay [1] 26/16 yeall [7] 18j2 81/14 86/23102/10 122j22 136/14 151/2 year [8] 19/24 20j16 25/10 79/11104/19 104/19133/4157/24 years [2] 20j12 30j21 yellow [1] 82/1 yes [84] 11/23 23/24 24/20 25/4 25/25 26/14 26/18 27/17 27/23 28/24 29/2 29/5 29/7 31/22 32/3 32/17 33/9 34/10 34/16 34/19 34/22 36/9 38/10 38/20 45/4 45/7 51/3 51/6 51/20 52/4 52/2156/2159/19 6o/24 62!19 65/14 67/17 69/2 72!5 76!2 76/5 76/13 76/16 76/19 76/2176/23 76/25 77/3 80/13 81/10 86/15 89/7 89/23 93/4 93/15 94/24107/6109/1112/15112/20115/1115/10 115/10 122/7122/10123/3 123/7125/1127/3 128/18130/10 137/4140/15141/8145/5 147/23149/18154/22155/1156/17159/10

1077 Tab V MOTION FOR PROTECTION JULY 18, 2014

2 REPORTER'S RECORD VOLUME 1 OF 1 VOLUMES 3 TRIAL COURT CAUSE NO. 2013-33584 WELLSHIRE FINANCIAL SERVICES, LLC d/b/a ) IN THE DISTRICT COURT LOANSTAR TITLE LOANS, d/b/a MONEYMAX TITLE ) ) LOANS, and d/b/a LOANMAX; MEADOWWOOD ) FINANCIAL SERVICES, LLC, d/b/a LOANSTAR ) LOANS, AND d/b/a MONEYMAX TITLE LOANS; and ) INTEGRITY TEXAS FUNDING, LP ) 8 ) vs. ) HARRIS COUNTY, TEXAS 9 ) TMX FINANCE HOLDINGS, INC.; TMX FINANCE, ) ) LLC; TMX FINANCE OF TEXAS, INC; ) and TITLEMAX OF TEXAS, INC. ) 152ND JUDICIAL DISTRICT 14 MOTION FOR PROTECTION 17 On the 18th day of July, 2014, the following proceedings came on to be held in the above-titled and numbered cause before the Honorable ROBERT K. SCHAFFER, Judge Presiding, held in Houston, Harris County, Texas.

21 Proceedings reported by computerized stenotype machine.

CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1078 MOTION FOR PROTECTION JULY 18, 2014

1 APPEARANCES MR. JOHN DANIEL JOHNSON SBOT NO. 24046165 SUTHERLAND ASBILL & BRENNAN, LLP 1001 Fannin Suite 3700 Houston, Texas 77002 Telephone: 713-470-6100 Fax: 713-654-1301 E-mail: [email protected] Counsel for PLAINTIFFS MS. CHRISTINA GOEBELSMANN SBOT NO. CA. 273379 WARGO FRENCH LLP 1888 Century Park F Suite 1520 Los Angeles, California 90067 Telephone: 310-853-6300 Fax: 310-853-6333 E-mail: [email protected]; [email protected] Counsel for PLAINTIFFS MR. JOSEPH W. OZMER, II SBOT NO. GA. 001542 WARGO FRENCH LLP Peachtree Street, NE 26th Floor Atlanta, Georgia 30309 Telephone: 404-853-1500 Fax: 404-853-1561 E-mail: [email protected] Counsel for PLAINTIFFS MR. GEOFF GANNAWAY SBOT NO. 24036617 MR. BRYON RICE SBOT NO. 24065970 BECK REDDEN 1221 McKinney Suite 4500 Houston, Texas 77010 Telephone: 713-951-6263 Fax: 713-951-3720 E-mail: [email protected]; [email protected] Counsel for DEFENDANTS CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1079 MOTION FOR PROTECTION JULY 18, 2014 produce that person and say it -- 2 THE COURT: Okay. All right. Let's see. I don't think they need to produce the person or persons who approved that type of marketing because I don't know what it gets you.

5 As far as what you just referred to, if your position is going to be that these were the acts of rogue employees, then they should be entitled to conduct Discovery to find out whether or not others above these rogue employees were involved in that.

9 And if that's marketing materials such as approving letters and so forth, then you need to identify them. But if you come in and say these were rogue employees and you haven't provided them information that they could use to prove otherwise, then that is going to be a problem at trial. And I think they are asking for that information in this Request.

15 It's broad, I agree. And if you can narrow it and focus it a little bit more, that will be better. But asking for the person that approved all the marketing directed at former -- directed at people who have loans at other places, that he just showed me would qualify and I just don't see why you need to know the identity of the person who put that out there -- who approved that.

21 But I do see why you would want to know identity of the person who said -- who recommended or suggested or prepared the materials which would be specifically geared towards you customer.

24 Does that make sense?

25 MS. GOEBELSMANN: Exactly. And what the intent was is what CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1080 MOTION FOR PROTECTION JULY 18, 2014 STATE OF TEXAS COUNTY OF HARRIS 4 I, Cynthia Martinez Montalvo, Official Court Reporter in and for the 152ND District Court of Harris, State of Texas, do hereby certify that the above and foregoing contains a true and correct transcription of all portions of evidence and other proceedings requested in writing by counsel for the parties to be included in this volume of the Reporter's Record in the above-styled and numbered cause, all of which occurred in open court or in chambers and were reported by me. 11 I further certify that this Reporter's Record of the proceedings truly and correctly reflects the exhibits, if any, offered by the respective parties.

14 I further certify that the total cost for the preparation of this Reporter's Record is $_______ and was paid by Beck Redden.

Is/ Cynthia Martinez Montalvo Cynthia Martinez Montalvo, CSR 18 Texas CSR 6863 Official Court Reporter 19 152ND District Court Harris County, Texas 20 201 Caroline, 11th Floor Houston, Texas 77002 21 Telephone: 713-368-6037 Expiration: 12/31/2014 CYNTHIA MARTINEZ MONTALVO, CSR 152ND DISTRICT COURT 713-368-6037 [email protected]

1081 Tab 1 In re Alcatel USA, Inc., 11 S.W.3d 173 (2000) 4:ffexsui0 cfrz?s Cases that cite this headnote KeyCite Yellow Flag- Negative Treatment Distinguished by ln rc 11u~h. Tcx.App.-Dallas, June 12,2009 J3J Pretrial Procedure 11 S.W.3d 173 .-" Corporate officers, agents, and Supreme Court of Texas. employees If the party seeking the apex deposition In re ALCATEL USA, INC. tjkja DSC of a high-level corporate official has Communications Incorporated, Relator. arguably shown that the official has any unique or superior personal knowledge of No. 98-1243. Jan. 6, discoverable infonnation, the trial comt 2000. I Argued Dec. 1, should deny the motion for protection 1999· Decided Jan. 6, 2000. and the party seeking discovery should be Competitor brought action against corporation for theft entitled to take the apex depositions. of trade secrets. The 193rd District Court, Dallas Cases that cite this headnote County, allowed competitor to take apex depositions of corporation's high-level executives. Corporation sought mandamus relief. The Dallas Court of Appeals 141 Pretrial Procedure conditionally granted mandamus relief. Competitor >"'" Corporate officers, agents. and filed petition for writ of mandamus. The Supreme employees Court, Abbott, J., held that competitor was not entitled Party seeking the apex deposition of a to take apex depositions of executives. high-level corporate official is required to pursue less intrusive means of discovering Petition denied. the information only when that party cannot make the requisite showing concerning unique or superior knowledge.

West Headnotes (9) 14 Cases that cite this headnote

Ill Mandamus 151 Pretrial Procedure /-· Ren1edy at Law >-'- Corporate officers, agents. and Mandamus employees -~---· Nature of acts to be commanded Competitor failed to show that corporate Mandamus relief is available only to defendant's chairman and chief executive correct a clear abuse of discretion when officer (CEO) had unique or superior there is no other adequate remedy at law. personal knowledge of discoverable infonnation, so as to entitle competitor Cases that cite this headnote to obtain apex deposition of CEO in competitor's action for theft of trade secrets; at most, competitor 121 Mandamus ."'-• Discretion of lower court demonstrated that CEO would have discoverable information, but not that When a party alleges that the court of CEO's knowledge was unique or superior. appeals abused its discretion by granting mandamus relief, Supreme Court focuses 4 Cases that cite this headnote on whether the trial court's ruling was an abuse of discretion.

161 Pretrial Procedure In re Alcatel USA, Inc., 11 S.W.3d 173 (2000)

.-"'"-' Corporate officers, agents, and Business disputes provide no greater employees license than any other kind of suit Testimony that a corporate executive to explore by apex deposition whether possesses knowledge of company policies a high-level corporate executive knows does not, by itself, satisfy the requirement anything relevant to the case. for obtaining an apex deposition of that Cases that cite this headnote executive based on executive's unique or superior personal knowledge.

2 Cases that cite this headnote Attorneys and Law Firms 171 Pretrial Procedure *174 Timothy S. Durst, Dallas, Bob E. Shannon, /"" Corporate officers, agents. and Austin, Joseph D. Cheavens, Houston, Joseph R. employees Knight, Joe R. Greenhill, Austin, Samara L Kline, Competitor failed to show that corporate Dallas, Scott Partridge, Houston, Michael P. Lynn, defendant's former chairman had unique Eric W. Pinker, John Jesse Kendrick, Robert E. or superior personal knowledge of Goodfriend, Dallas, for relator. discoverable information, so as to entitle competitor to obtain apex R. Laurance Macon, San Antonio, Jack Hightower, deposition of CEO in competitor's action Austin, David .1. Healey, Houston, Nina Cortell, for theft of trade secrets; at most, Dallas, Lynne Liberato, Houston, Mike A. Hatchell, competitor's evidence established that Tyler, Stephan B. Rodgers, Karen Kroesche Guide, fanner chairman received information Melanie Goins Cowart, San Antonio, Ana E. Kadala, related to underlying facts of case, but Stephen L. Lundwall, Houston, Sharon N. Freytag, others had the same information. Debra Janece McComas, Dallas, for respondent.

I Cases that cite this headnote Opinion Justice ABBOTT delivered the opinion of the Court, 181 Pretrial Procedure in which Chief Justice PHILLIPS, Justice HECHT, Corporate officers, agents. and Justice OWEN and Justice GONZALES join. employees The issue in this mandamus proceeding is whether To obtain apex deposition of high- the trial court abused its discretion by allowing DSC level corporate official based on official's unique or superior personal knowledge, Communications 1 to take the apex depositions of two there must be some showing beyond mere high-level Samsung executives. The court of appeals relevance, such as evidence that a high- conditionally granted mandamus relief, concluding level executive is the only person with that DSC failed to prove that the executives had personal knowledge of the information "unique or superior knowledge that is unavailable sought or that the executive arguably through less intrusive means."-- S.\V.3d - - , 1998 possesses relevant knowledge greater in WL 851123. We hold that DSC failed to present any quality or quantity than other available evidence that arguably shows that the executives have sources. unique or superior personal knowledge of discoverable information. Thus, the court of appeals did not err in Cases that cite this headnote conditionally granting the writ of mandamus because the trial court abused its discretion by overruling 191 Pretrial Procedure Samsung's 2 motion to quash the depositions. We _,_ Corporate officers, agents, and therefore deny Alcatel's request for mandamus relief. employees

Ne:.:t In re Alcatel USA, Inc., 11 S.W.3d 173 (2000) 43fex:sup. Central Petroleum Corp. v. Garcia, 904 S. W.2d 125 (Tex.l995), the coutt of appeals held that DSC I had failed to prove that it was entitled to take the DSC filed this suit alleging that Samsung engaged apex depositions and conditionally granted mandamus in a plan to steal a new DSC telecommunication relief. DSC filed a petition for writ of mandamus in technology known as "intelligent network" and "next this Court, arguing that the court of appeals abused its generation switching" systems. DSC asserts that discretion by granting the writ because the trial court Samsung identified and lured a team of *175 did not abuse its discreti-on. engineers away from DSC and then specifically assigned them to develop the same type of product they had developed at DSC. DSC claims that Samsung's II actions were the direct result of a plan engineered at the highest level ofSamsung's executive structure, and Ill 121 Mandamus relief is available only to that highest-level Samsung executives were involved correct a "clear abuse of discretion" when there is in the plan's execution at all stages. no other adequate remedy at law. See Walker v. Packer, 827 S.W.2d 833, 839-44 (Tex.l992). When DSC noticed the depositions of two high-level a party alleges that the cou1t of appeals abused its Samsung executives, Jin-Ku Kang and Kun-Hee Lee. discretion by granting mandamus relief, this Court Kang served as Chaiiman of defendant Samsung focuses on whether the trial court's ruling was an abuse Electronics Co., Ltd. (SEC) during the earliest events of discretion. See in re Meador, 968 S.W.2d 346, giving rise to this case and is currently Chairman 350 (Tex.l998) (citing Johnson v. Fourth Court of" Emeritus of that corporation. Lee is currently Appeals, 700 S.W.2d 916.918 (Tex.l985)). We agree Chairman and CEO of SEC and fonnerly served as with the court of appeals that the trial court's ruling was the Chairman of the Samsung Chaebol 3 during the an abuse of discretion and therefore we deny DSC's earliest events at issue in this case. DSC and Samsung request for mandamus relief. agree, and therefore we assume, that the Kang and Lee depositions qualifY as apex depositions.

III Samsung moved to quash both depositions. At the first evidentiary hearing on the issue, the special discovety This Court first adopted the apex deposition guidelines master assigned to the case deferred ruling until after in Crown Central Petroleum Corp. v. Garcia. 904 the deposition of Mr. K.H. Kim, the former President S.W.2d 125 (Tex.l995). We held that the apex deposition guidelines apply "[w]hen a party seeks and CEO of SEC at all times relevant to this matter.

After Kim's deposition, DSC renewed its request for to depose a corporate president or other high level the Kang and Lee depositions and moved to compel corporate official." /d. at 128. A party initiates the Croll'n Central guideline proceedings by moving for both. After holding another evidentiary hearing, the special discovety master denied Samsung's motion protection and filing the corporate official's affidavit to quash and ordered that both depositions proceed. denying any knowledge of relevant facts. The trial Samsung appealed the special discovety master's court evaluates the motion first by deciding if the party seeking the deposition has "arguably shown that the order to the trial court. The trial court reviewed the transcripts of these hearings and conducted a third official *176 has any unique or superior personal knowledge of discoverable information." !d. "If the hearing. The trial judge denied Samsung's appeal and affirmed the special discovery master's order. Samsung party seeking the deposition cannot show that the official has any unique or superior personal knowledge moved for reconsideration. After a fourth hearing on Samsung's motion to reconsider, the trial judge denied of discoverable information, the trial court should" not allow the deposition to go forward without a showing, the motion. after a good faith eff01t to obtain the discovery through less intrusive means, "(I) that there is a reasonable Samsung filed a petition for writ of mandamus with the court of appeals. Basing its decision on Crown indication that the official's deposition is calculated

Ne:·:t In re Alcatel USA, Inc., 11 S.W.3d 173 (2000)

to lead to the discovery of admissible evidence, and specifying the reasons. Accordingly, mandamus is not (2) that the less intrusive methods of discove1y are appropriate if the trial courfs order can be sustained unsatisfactory, insufficient or inadequate." !d. under either Crown Central test. We consider first whether DSC arguably showed that Lee or Kang have J31 141 While we agree with the court of appeals' unique or superior personal knowledge of discoverable conclusion that mandamus relief was appropriate, we information. disagree with that court's phrasing of the Croll'n Central guidelines. The court of appeals stated: "A party requesting an apex deposition must show that the LEE corporate official to be deposed has an [sic] unique or superior personal knowledge that is unavailable !51 The most comprehensive discussion ofKun-Hee through less intrusive means." - S.W.3d - - , Lee's knowledge as it relates to this lawsuit is found 1998 WL 851123. That phrasing of the guidelines in a document submitted by DSC titled: "Kun-Hee improperly collapses the two discrete inquiries into Lee's Significance and Connection to This Lawsuit." In a single test. Under Crowu Central. if the party that document, DSC urges several reasons why Lee's seeking the deposition has "arguably shown that deposition is necessary. First, under the heading "Kun- the official has any unique or superior personal Hee Lee Sets Sam sung's Course," DSC claims that (I) knowledge of discoverable information," the trial court Lee is the leader of the Samsung Chaebol, (2) Lee should deny the motion for protection and the party sets the overall vision for the Samsung companies, seeking discovery should be entitled to take the apex and (3) Samsung's goal is to be one of the world's top depositions. Crown Cent., 904 S.W.2d at 128. The five telecommunications companies by 2005. Second, party seeking the apex deposition is required to pursue under the heading "Kun-Hee Lee's Ties To The less intrusive means of discovering the information Lead Defendant, Samsung Electronics Co., Ltd.," DSC only when that party cannot make the requisite states that Lee ( 1) was the chief executive officer and showing concerning unique or superior knowledge. president of SEC, (2) was a long-standing director of See id We recognize that these guidelines could be SEC, and (3) is *177 the largest single owner of read as requiring trial courts to undertake two hearings Samsung and its subsidiaries. and issue two orders: First, a hearing on whether to grant a protective order and, if one is granted, Evidence tending to support these allegations does then a second hearing, after less intrusive methods of not satisfy the first Crown Central test; it merely discovery have been explored, to determine whether demonstrates that Lee is a long-time company the protective order should be dissolved. We believe leader who sets the company vision with lofty that such a mechanical application of the Crown goals. Virtually eve1y company's CEO has similar Central guidelines is unnecessary when, as here, the characteristics. Allowing apex depositions merely parties have already unde1taken extensive discovery because a high-level corporate official possesses apex- and the court has sufficient information to consider level knowledge would eviscerate the very guidelines both prongs of the guidelines. established in Crown Ce11tral. Such evidence is too general to arguably show the official's knowledge is In this case, when Samsung moved for the unique or superior. protective orders the pa1ties had already engaged in significant discovery, including more than 300 161 In AM/I Corp. v. EnhM, 926 S.W.2d 640 hours of depositions. At this stage of discovery, (Tex.App.-Fort Worth 1996, no writ), the Second nothing in Cml!'n Central precluded the trial court Court of Appeals addressed a somewhat similar from considering whether DSC had attempted to argument. In .1MR Corp., an American Airlines gain the information by less intrusive means and passenger became intoxicated on his flight and otherwise satisfied the second Crown Central test. later had a traffic accident with the plaintiff. The The parties argued both Crown Central tests in the plaintiff sued AMR Corp. and American Airlines trial court, and both the discovery master and trial under the Dramshop Act. The plaintiff sought the judge denied the requested protective orders without apex deposition of Robert Crandall, AMR's president, In re Aicatei USA, Inc., 11 S.W.3d 173 (2000) 'i'Hex~- suf)c\7278__ _ ~'-~~--·--~-~-·-~---·-·--~-·~ -----·---~- -~~-~~--~--~-~-~~----~-~ ----~~---~-·

CEO, and chairman of the board, and American Airlines, Inc.'s CEO and chairman of the board, KANG arguing that he "wish[ed] to depose Robett Crandall in order to determine where the authority lies within [7[ J.K. Kang served as Chairman of defendant the organization for making those [alcohol service SEC during the earliest events that gave rise to this and flight attendant training] policy decisions so that case and is currently *178 Chairman Emeritus of Plaintiffs can understand how and why those policy that corporation. DSC contends that Kang's unique or decisions were made and what precisely the policies superior personal knowledge is arguably shown by the in place were." !d. at 643. The court of appeals deposition testimony of Dr. Joo Hyung Lee, an SEC held that "[t]his testimony amounts to nothing more manager who personally oversaw the establishment than the simple, obvious recognition that the highest- of Samsung's Dallas laboratory. Contrary to DSC's ranking corporate officer of any corporation has the contention, Joo Hyung Lee's deposition conveys that ultimate responsibility for all corporate decisions and Kang may have been made aware of information falls far short of the [Crown Cenlra! ] standard." contained in reports prepared by others, but still does ld at 644. We agree with the AM/I C01p. court not show why Kang's knowledge may be unique or of appeals. Testimony that a corporate executive superior. possesses knowledge of company policies does not, by itself, satisfy the first Crown Central test because it In his deposition, Joo Hyung Lee testified that does not show that the executive has unique or superior he prepared a status rep01t of the next-generation knowledge of discoverable information. See In re El switching system and presented it to, among Paso l/eal!hcare c~:vs., 969 S. W.2d 68. 74 (Tex.App. others, Song, the Samsung executive in charge ~EI Paso 1998, no writ) ("A generalized claim that of telecommunications, and Kang. Joo Hyung Lee a corporate president has ultimate responsibility for characterized the report as an overview that did not last all corporate decisions or has knowledge of corporate very long-it was "kind of a simple thing." He further policy is insufficient to establish that the corporate testified that, other than that single presentation, he president has unique or superior personal knowledge had no other communication with Kang concerning the of discoverable information."); see also AMR Corp., next-generation switching system. Further probing by 926 S.W.2d at 644. DSC during Joo Hyung Lee's deposition indicated that none of the project's details were conveyed to Kang Under the heading "The Samsung Project At Issue In by Joo Hyung Lee; instead, it was Joo Hyung Lee and This Case Smacks Of Chairman-Level Importance," Song who were involved in the details: DSC claims that (1) the "[t]echnology at issue in this case involved huge investments and expected Q. And I believe section 1.3 [of the document revenue," (2) "SEC's commitment to technology in entitled "The Current Status of the Next- this case is significant to execution" of its plan to be Generation Switch System"] provides the time in the top five companies in its industry, (3) "[t]he line for the next-generation system as you [Joo significance of the project is illustrated by the claims Hyung Lee] contemplated it at that time? made in this case," 5 and (4) "Kun-Hee Lee has A. Yes, that's right. been involved with Samsung's telecommunications business." Proof of the imp01tance of the project to Q. And if you turn to the next page, I believe this Samsung, combined with the allegation that the issue page addresses the-what is called a progress in this case "smacks of chairman-level importance," report, and Section 2.1 addresses employment at most tends to show that the chairman-level official status; is that right? whose deposition is sought may possess discoverable information. It does not, however, arguably show A. Yes, that's correct. that the official's knowledge is unique or superior.

Q. And the-the box is indicating the number of Consequently, the first prong of the Crown Central people that you had interviewed as well as the guidelines has not been satisfied with regard to Lee.

Next In re Alcatel USA, Inc., 11 S.W.3d 173 (2000)

response to your advertisements, things like that; is that co!Tect? *179 Q. And that was my question. Were these matters presented to Chainnan Kang during the A. That's correct. presentation?

Q. And at that time, you we~e indicating to A. No. I don't think there-that would have been Chairman Kang that you had 15 total people necessary vis-a-vis the chailman. that you were engaged in employment contract negotiations with? Q. Would these have been discussed with Mr. Song?

A. Well, Pm thinking, you know, again, that this and A. Yes. the subsequent stuff, you know, I don't think we necessarily made a report on that to the chairman. Additionally, DSC claims that an index of computer files produced by Sam sung contains numerous listings Q. Are you saying that the items in part two, you're of computer files identified as reports to J.K. Kang on unce1iain whether they were presented to the Samsung's next generation switching system. One of chairman? these reports that Kang apparently received a copy of was titled "Action Plans for the Development of the A. I'm thinking that we probably did not specifically Next Generation Telecommunication System." make a report on this to him. I mean, this is, you know, all too detailed a level for it to be, you 181 This evidence arguably shows that Kang may know, reported to the chairman. have discoverable information. But the first Crown Central guideline requires more; it requires that the person to be deposed arguably have "unique Q. Did you discuss this with Mr. Song? or superior personal knowledge of discoverable information." This requirement is not satisfied by A. Yeah, because that's a matter of the progress, just merely showing that a high-level executive has in a simple fashion. some knowledge of discoverable information. If "some knowledge" were enough, the apex deposition Q. With respect to item three of the document, guidelines would be meaningless; they would be which I believe concerns the status report on virtually indistinguishable from the scope of general the facilities or the buildings that you were discovery. Although Crown Ce11tral did not elaborate considering, did you discuss that with Chairman on what character of knowledge makes it unique or Kang? superior, there must be some showing beyond mere relevance, such as evidence that a high-level executive A. l don't recall that I did. is the only person with personal knowledge of the Q. Did you discuss it with Mr. Song? information sought or that the executive arguably possesses relevant knowledge greater in quality or A. Yes. We just kind of briefly told him about how quantity than other available sources. there was something like this.

At most, DSC's evidence establishes that Kang Q. And would you turn to the folll1h matter in the received information related to the underlying facts document on the last page. of this case. A recipient's knowledge of the contents A. Yes. of a report is not unique or generally superior to the author's, of course. The record shows that Joo- Q. Which I believe is addressing proposed matters; Hyung Lee's and Song's knowledge of the reports to is that co!Tect? Kang is comparable, if not superior, to the knowledge possessed by Kang. Although both Joo-Hyung Lee A. Well, proposed, well, basically I, you know, kind and Song were deposed by DSC, the record does not of presented my opinions during this time of the show that Kang possessed information not possessed -the report.

'i: In re Alcatel USA, Inc., 11 S.W.3d 173 (2000)

by Lee and Song and does not show that Kang had may well be true that many tort claims arise without relevant knowledge that was greater in quantity or the knowledge or involvement of a high-level officer. quality than Lee or Song. Combined with other factors, Conversely, it may also be true that many business receipt of such a rep01t could arguably support that disputes directly involve the decisions or actions of Kang had unique or superior knowledge. But evidence a high-level officer. Regardless of the truth, vel non, that an apex official received information requires of these suppositions, the fact remains that the Crown something more to establish that the apex has unique Central guidelines must be applied. or superior knowledge of discoverable information.

v IV Because DSC failed to arguably show that either DSC seeks to distinguish busil)ess-related cases like Kang or Lee possesses unique or superior knowledge this from tort-related cases like Crmvn Central and of discoverable information, the trial court's order AMR Cmp. DSC contends that the trial cou1t, cannot be supported under the first Crown Central in allowing the depositions to proceed, considered test. Nevertheless, DSC argues that it has pursued that "this litigation involves two giant international less intrusive means and therefore is entitled to the multinational corporations suing each other over depositions under Croll'n Central's second guideline: trade secrets and corporate direction, policy and defamation." DSC argues that, "(i]n contrast to cases If the party seeking the like ... Crown Central, this is the very kind of lawsuit deposition cannot show that in which high-level executives would be expected the official has any unique or to pmticipate." (Emphasis in original). The special superior personal knowledge of discovery master apparently agreed with this reasoning discoverable information, the by stating: trial court should grant the motion for protective order and [T]his is not the same situation first require the party seeking as in Crown Central or the the deposition to attempt to Wal-1\1art case, the original obtain the discovery through apex deposition case. Mr. Lee less intrusive methods .... After appears to be the one person making a good faith effort to at the very top of the chain obtain the discovery through at Samsung, and it may ve1y less intrusive methods, the well be that he does not party seeking the deposition know anything that's relevant may attempt to show (I) to this case, and that can be that there is a reasonable determined very quickly. But I indication that the official's think that DSC ought to have an deposition is calculated to opportunity to test that. lead to the discovery of admissible evidence, and (2) (Emphasis added). that the less intrusive methods of discovery are unsatisfactory, !91 Even if a lawsuit concerns a business dispute insufficient or inadequate. If rather than a tort claim, and regardless of whether high- the party seeking the deposition level executives would be expected to participate in makes this showing, the a decision relevant to the dispute, the Crown *180 trial cmut should modifY or Central prerequisites must still be met. Business vacate the protective order disputes provide no greater license than any other kind as appropriate .... If the party of suit to explore by apex deposition whether a high- seeking the deposition fails level executive knows anything relevant to the case. It In re Alcatel USA, Inc., 11 S.W.3d 173 (2000) 43Tex~Sup~Ct. J. 2iif" to make thfs showing, the its discretion in overruling Samsung's motion to quash trial court should leave the the depositions ofKang and Lee. protective order in place.

Croll'n Cent., 904 S.W.2d at 128. ***** From the record before us, DSC has not shown We agree with the court of appeals' conclusion that that it attempted to obtain the information it sought the trial court abused its discretion when it refused from Kang through less intrusive methods. DSC to qua~h the depositions of Kang and Lee because . based its contention that Kang has unique or superior it failed to properly apply the guidelines set forth in knowledge largely on his presence at a written and oral Crown Central v. Garcia. Accordingly, we deny the presentation concerning the next generation switching mandamus relief requested by DSC. system. But, DSC was allowed to depose Joo-Hyung Lee, who presented the report to Kang and Song.

Also, DSC deposed Song, the Samsung executive in charge of telecommunications, who also attended Justice ENOCH filed a dissenting opinion, in which the presentation. Yet, DSC has failed to identify any Justice BAKER and Justice O'NEILL join. relevant information that it seeks from Kang that it Justice HANKINSON did not participate in the attempted and failed to obtain from either Joo-Hyung decision.

Lee or Song.

Justice ENOCH, joined by Justice BAKER and Justice In addition, DSC failed to establish that it attempted to O'NEILL. obtain the information that it sought from Lee through This Court has held that the proper place to amend or less intrusive methods. DSC argued that Lee has promulgate a rule is through rulemaking, not judicial unique and superior knowledge regarding Samsung's fiat. 1 Yet today, from mere guidelines intended to policies. But the special master allowed DSC to depose aid a trial court's decision to allow or prevent apex Kim, the president and CEO ofSEC during the relevant depositions in the context of discovery harassment, time. Yet, DSC failed to ask Kim any questions the Court effectively forges an apex deposition about Samsung's "vision" for telecommunications or rule--one, significantly, not found in our recently any of the other issues DSC now contends justify promulgated discovery rules. This new rule erects an an apex deposition of Lee. DSC also did not issue improperly high barrier, imposing a special protection interrogatories, requests for admissions, or any other for corporate officials. forms of discovery to Samsung regarding its corporate policies. The record simply does not show that the The apex guidelines arose from an evaluation of information sought from Lee was sought by less the existing Rules of Civil Procedure, which have intrusive means or that the information sought was long a1iiculated a deponent's right to protection "from unobtainable from other sources. undue burden, unnecessary expense, harassment, Absent a showing that an executive arguably has [or] annoyance ... .'' 2 The progenitor of Texas cases unique or superior personal knowledge, a comi has analyzing the propriety of apex depositions is Wa/- no discretion to allow an apex deposition unless Mart ,)'tores. Inc. v. Street. 3 In that case, this Court the party seeking the deposition establishes that it examined a business invitee's assertion in a slip-and- has attempted to obtain the information through fall case that he should be allowed to depose the less intrusive methods. The special master provided chair ofWal-Mart's Board of Directors, Sam Walton.

DSC with the opportunity *181 to depose other We held that the trial judge abused his discretion Samsung executives who at least arguably possessed by ordering the deposition to be taken at a location the information DSC seeks. Yet, DSC either failed to other than Walton's residence or place of business. 4 take advantage of that opportunity or failed to preserve Our decision in Street recognized the potential for its attempts in the record. Thus, the trial court abused harassment that high-level corporate officials face

Ne:.:t In re Alcatel USA, Inc., 11 S.W.3d 173 (2000) Tex. Sup. ct. J. 278 ------ when a corpOration is routinely subjected to litigation, a trial court's discretion to allow or prevent an apex and when the official's connection to the case is as deposition. Petiinent to this case, the trial court's tenuous as Walton's connection to a slip-and-fall case discretion was to be guided by whether DSC arguably in one of hundreds ofWal-Mari stores. showed that Kang or Lee had any unique or superior personal knowledge of discoverable information, and, Despite the Court's concerns signaled in Street, generally, whether the depositions were sought to litigants continued to seek the depositions of highest harass. 12 The Court's decision today raises a barrier ranking executives of large corporations in what to many otherwise legitimate apex depositions by appeared to be nothing more than an effort to harass divesting the trial court of its discretion, and by or pressure settlement by needlessly increasing the substituting this Court's judgment for the trial court's. costs of litigation. 5 Deciding that it was appropriate to alert com1s to such undue discovery burden and harassment, we established parameters to guide a LEE trial court's discretion. 6 While I strongly support the protection from harassment that our apex deposition In AMR Corp. v. Enlow. 13 the plaintiffs argued that guidelines provide, I do not countenance a de facto they could depose AMR CEO Robert Crandall in rule, unavailable to any other potential deponent, that their dramshop negligence case because Crandall had extends a privilege to corporate officials to avoid ultimate authority on all of AMR's policies. The court depositions by virtue of their position. of appeals prevented the deposition, concluding that ultimate policy authority is insufficient evidence and Consistent with this Court's holding in Crown that pmiies must articulate facts implicating the apex Central. 7 I would hold that when *182 there official's personal knowledge. 14 The allegations and is evidence that arguably shows that a high-level mandamus evidence in this case point to Lee in the corporate official has any unique or superior personal same way the AM/I plaintiffs pointed to Crandall. knowledge of discoverable information, a trial court DSC's record evidence reflects such nebulous items as does not abuse its discretion by allowing an apex the fact that Lee sets the overall vision for Samsung, deposition. But when the evidence suggests only that a is a principal Samsung shareholder, and believes high-level official's deposition is being sought because Samsung should actively pursue status as a top-five the official has ultimate decisionmaking authority, global telecommunications company. Allegations that "this amounts to nothing more than the simple, obvious a CEO should be deposed because that is where recognition that the highest-ranking corporate officer the buck stops are not evidence arguably showing of any corporation has ultimate responsibility for all unique or superior personal knowledge of discoverable corporate decisions," s and falls far short of supporting information. As such, I believe the Comi correctly a trial court's discretion to allow the deposition. adopts the AM/I standard with regard to Lee. But Consequently, I disagree with the court of appeals' while I agree with the Court's result on Lee, my conclusion in this case protecting Kang from being decision would hinge only on the AAfR rationale. The deposed, but agree that Lee cannot be deposed. l would F011 Worth Cowt of Appeals described and answered therefore conditionally grant mandamus in part against the problem succinctly. I would not go beyond that the court of appeals, and allow the Kang deposition to rationale in analyzing whether the trial court abused its proceed. discretion by allowing Lee's deposition.

To determine whether the court of appeals improperly granted mandamus relief, this Court focuses on *183 KANG whether the trial court1s mling was an abuse of discretion. 9 A trial COllli is vested with broad The mandamus record reflects that the special discovery master, Judge Andrews, sat through more discretion in the area of discove1y. 10 Indeed, the than thirty hearings on more than sixty discove1y reviewing CQUrt may not substitute its judgment for motions. The record also reflects that Judge Andrews the trial court's. 11 Crown Central's guidelines infom1 In re Alcatel USA, Inc., 11 S.W.3d 173 (2000) tex. sup. cCJ 2?8 understood that this was not a case in which the facts As evidence that Kang did not reach this level of driving the litigation are extremely remote from the knowledge, the Comi offers Dr. J.H. Lee's deposition CEO and trickle up the corporate structure. Here, testimony that: (I) the repmt was a simple thing that corporate policy and directives may have pushed did not last long; (2) outside of the report, Dr. Lee the events driving this litigation down the corporate had no other communication on the next-generation hierarchy. Inevitably, the policies driving corporate network switch system with Kang; and (3) Dr. Lee action and personal knowledge of actions taken in conveyed no project details to Kang. 16 In support pursuit of such policies intersect. One federal court of its conclusion, the Court announces the new apex has held that at this intersection, "when the motives deposition rule that a party must make a showing behind corporate action are at issue, an opposing party beyond mere relevance with evidence "such as ... that usually has to depose those officers and employees " (1) a high-level executive is the only person with who in fact approved and administered the particular personal knowledge of the information sought or (2) action." While it is not this Colllt's role to say the executive arguably possesses relevant knowledge whether Kang arguably was at the intersection of greater in quality or quantity than other available Samsung's corporate policy and the events driving this sources." 17 Relying on this new rule, the Comi litigation, given the evidence before it, the trial court surmises that Kang cannot be deposed because, at best, did not abuse its discretion by doing so. Dr. Lee's deposition '~conveys that Kang may have been made aware of information contained in reports Only after an exhaustive review of the evidenCe prepared by others, but still does not show why Kang's DSC presented did the trial court conclude that Kang knowledge may be unique or superior." 18 This new arguably had unique or superior personal knowledge rule and its rationale are problematic. of discoverable information. DSC offered evidence that Kang was directly involved in Samsung's next * 184 The Court's conclusion is problematic because generation switching system project and had been it would require a litigant seeking to depose a specifically informed of Samsung's efforts to obtain CEO regarding a board-level decision, about which DSC technology. There was also evidence that Kang all present at the board meeting have the same received a written and oral presentation in 1996 about information, to depose a lower-level board member the status of Samsung's next generation switching and not the CEO. Why should a litigant be forced to system project in the United States, and that numerous depose the least qualified witness when it could depose reports were provided to Kang on the same project the most qualified if they have the same information? around the time of the events giving rise to this While the CEO and a lower-level official may have suit. One of the reports apparently contained an the same information, they have different levels of organizational chart for Samsung's telecommunication knowledge. As one federal comi has concluded, an project that contained the names of DSC employees apex official's knowledge may be deemed unique and -who were still with DSC at the time. When asked the deposition allowed, even if other corporate officials why he made the presentation to Kang, a lower-level . "I ar know Ie dge. 19 possess sum Samsung official responded "because [Kang] had a Jot of interest in the information telecommunications side of the business." While this evidence shows Moreover, the Court's opinion treats "knowledge" as Kang's personal knowledge of relevant information, though it were only the bare facts communicated the question Crown Cemra/ requires the trial comi to Kang and nothing more. But knowledge is more to consider before allowing the deposition is whether than mere information. The Comi ignores the role DSC arguably showed that the knowledge was unique that Kang's, or any apex official's, position within the or superior. corporation plays on the information received. When the policies driving corporate action and personal Substituting its judgment for the trial court's, the Court knowledge of actions taken in pursuit of such policies concludes that Kang could not be deposed because intersect, a new level of knowledge arises. When DSC did not arguably show that Kang's knowledge the motives behind corporate action are at issue, of discoverable information was unique or superior. arguably the knowledge created at that intersection

,_. i j In re Alcatel USA, Inc., 11 S.W.3d 173 (2000) rex sup ci.Ti?a is unique to the corporate officer. And certainly that and the official's corporate role arguably combine to level of knowledge is "greater in quality" than the level form unique or superior knowledge, the trial com1 does not abuse its discretion to allow the deposition. For possessed by the individual who communicated only this Court to decide that the trial court *185 abused the bare facts. its discretion here, invades the trial court's discretion in the type of judgment call where it is uniquely This does not mean that an apex official who implicated. merely receives information will automatically be deposed. Trial courts must continue to employ the As Crown Central counsels, trial courts should Rules of Civil Procedure to protect all potential carefully balance litigants' need for information deponents from "undue burden, unnecessary expense, against the potential for abuse apex depositions pose. harassment, [or] annoyance ... .'' 20 Moreover, as the And while the discovering pmty may not initially Fort Worth Court of Appeals correctly recognized, be entitled to the deposition if they fail to make for corporate officials, bald allegations of final the requisite showing, the matter is not foreclosed. policymaking authority will not constitute sufficient Crown Cenfral counsels that after a party has failed to evidence to justify an apex deposition. Likewise, mere offer some evidence that arguably shows the official's allegations that the apex official both forms policy unique or superior knowledge, the party may still and has personal knowledge of facts relevant to the pursue a good faith effort to discover the information litigation do not arguably show unique or superior through less-intrusive methods, and then attempt to knowledge. Rather, there should be some evidence that the confluence of the official's policy-forming take the apex deposition . 22 role and personal knowledge of activities related to A trial court clearly abuses its discretion if "it such policies arguably creates unique o1· superior reaches a decision so arbitrary and unreasonable knowledge of discoverable information. as to amount to a clear and prejudicial en·or of The Court's reliance on the amount of Kang's law." 23 Given the evidence before it, and the knowledge that Dr. Lee's deposition testimony special master's intimate familiarity with the case, I "conveys" is also troublesome. Benefitted by cannot say that the trial judge's decision to permit numerous hearings and direct contact with the litigants Kang 1s deposition was arbitrary and unreasonable. and the evidence, the special master and the trial judge DSC presented evidence that supports the trial court's had no need to rely on the mere inlplications of the decision because it arguably shows that Kang had evidence. Indeed, trial courts have the best vantage unique or superior discoverable knowledge. And with point from which to determine whether an apex respect to resolution of factual issues or matters official's receipt or use of information communicated committed to the trial court's discretion, the reviewing by lower-level officials arguably shows unique or court may not substitute its judgment for that of superior knowledge. the trial court. 24 Finally, Judge Andrews was not unmindful of the possibility that the depositions were To make this determination, trial com1s should sought to harass. He therefore specifically limited the consider the context of the allegations the discovering depositions to matters raised in the parties' claims party raises, the type of information sought from and counterclaims. Thus, the trial court did not abuse the official, any evidence of the official's role in its discretion when it refused to quash the deposition the specific act or transaction underlying the suit, of Kang. Consequently, I would conditionally grant and the official's role within the corporation relative mandamus in part against the com1 of appeals, to the corporation's size. In addition, if the party allowing Kang's deposition to proceed, but preventing merely seeks factual information an apex official Lee's. receives, the trial court may limit such discovery if the information "is obtainable from some other source that is more convenient, less burdensome, or less Parallel Citations expensive." 21 But if the discovering party presents 43 Tex. Sup. Ct. J. 278 some evidence showing that the receipt of information In re Alcatel USA, Inc., 11 S.W.3d 173 (2000) 4·3 Tex. Sup ct. J278 Footnotes In September 1998, DSC Communications Corporation merged with and changed its name to Alcatel USA, Inc. We refer to Relator throughout this opinion as DSC, as it was referenced in the trial court and the court of appeals.

2 The real parties in interest are James L. Bunch, Michael Bray, David Fox, Kevin Gallagher, Bhushan Gupta, Nancy Korman, James Olivier, Leo Putchinski, Martin Wu, Samsung Electronics Corp., Samsung Electronics Co., Ltd., and Samsung Telecommunications America, Inc. They are collectively referred to as "Samsung."

3 A chaebol is a Korean conglomerate in which subordinates are extremely deferential to their hierarchical superiors.

4 Mr. Kim currently serves as the CEO and Chairman of Samsung Americas.

5 DSC states that ( 1) "SEC claims $300 million in damages caused simply by a delay in this project,'' (2) ;'DSC's damages are $1.3 billion, including present value of $922 million for Sam sung's ill~gotten profits,'' and (3) ·'OSC's claims for punitive damages arise, in part, from Samsung's corporate culture and strategic directives, which have been set by the highest level ofSamsung management, including Kun-Hee Lee," See State Dep't of/-liglnFa)'s & Pub. Tramp. v. Pqvne, 838 S.W.2d 235. 241 (Tex. 1992); Alvarado\'. Farah 1\·(f..~. Co .. 830 S. W.2d 911. 915 (Tcx.l992).

2 TEX.R. CIV. 1'. 192.6(b).

3 754 S.W.2d 153 (Tcx.19XS).

4 See id. at 155.

5 See Monsanto Co. v. Mczv, R89 S. W.2d 274 (Tcx. 1994) (opinion on denial ofleave to file petition fOrwritofmandamus).

6 See Crown Cent. Petmleum Corp. v. Garcia. 904 S. \V .2d 125. 128 (Tex. 1995).

7 See id. 8 AMR Corp. v. Enlow, 926 S.W.2d 640. 644 (Tcx.App.-Fort Worth 1996. orig. proceeding).

9 See In re Afeador. 968 S. W.2d 346, 350 (Tcx.I99R).

10 See Ginsberg v. F[(lh Court of Appeals. 686 S. W .2d I 05. I 08 (Tcx. 1985).

II See Brady v. Fourteenth Court a./Appeals, 795 S. W.2d 712. 714 (Tex.l990).

12 See Crown Central, 904 S.W.2d at 128 (emphasis added).

13 926 S.W.2d 640 (Tex.App.~Fort Worth 1996. orig. proceeding).

14 See id. at 644.

15 )i-awlcrs //ental Co. v. t·<ml Motor Co., 116 P.R.D. 140. 142 (D.Mass.l987).

16 II S.W.3d atl78.

17 !d. at 179.

18 /d. at 178.

19 See S.,peadmark. Inc. v. Federated Dep't S'!ores, Inc., 176 F.R.D. 116. 118 (S.D.N.Y.l997).

20 TEX.R. CIV. P. 192.6(b) 21 TEX.R. CIV. P. 192.4(a).

22 See Crml'll Central. 904 S.\V.2d at 128.

23 Johnson v. Fourth Court of Appeals. 700 S. W .2d 9\6, 917 {Tcx. 1985).

24 See Flores v Fourth C'ourt o.(Apr1eals. 777 S. \V .2d 38. 41 ~42 {Tcx.19X9).

End of Document C;J 2015 Thomson Reuters No clatm to origtnal US Government Works Tab 2 Baxter v. Palmigiano, 425 U.S. 308 (1976) 96s.ct. 1ssT4h.Ed.2d sfo ------- Mr. Justice Brennan filed opinion concurring in part and dissenting in part in which Mr. Justice Marshall KcyCitc Yellow Flag- Negative Treatment joined.

Not Followed on State Law Grounds Fischer v. Hooper, N.H., June 16, \999 96 S.Ct. 1551 West Headnotes (14) Supreme Court of the United States Joseph BAXTER eta!., Petitioners, Federal Civil Procedure Ill v. "~__, In general; certification in general Nicholas A. PALMIGIANO. Without certification of action as class Jerry J. ENOMOTO eta!., Petitioners, action and identification of class, action v. is not properly a class action. Fed. Rules John Wesley CLUTCHETTE et al. Civ.Proc. rule 23(c)(l, 3), 28 U.S.C.A.

Nos. 74-1187 and 74-1194. Argued 31 Cases that cite this headnote Dec. 15, 1975. I Decided April 20, 1976.

Actions were brought by state prison inmates alleging 121 Constitutional Law .;o... Prisons that procedures used in prison disciplinary proceedings violated their constitutional rights. In one action, the Constitutional L~nv District Comt, 328 F.Supp. 767, granted substantial -= Prisons relief, and the Court of Appeals, 497 F.2d 809, Although one of named plaintiffs in 510 F.2d 613, affirmed. In the other, the district action by state prison inmates alleging cou1t denied relief and the Comt of Appeals, 487 that procedures used in disciplinary F.2d 1280. reversed. On remand by the Supreme proceedings at prison violated their rights Comt, 418 U.S. 908, 94 S.Ct. 3200. 41 L.Ed.2d to due process and equal protection 1155, the Court of Appeals, 510 F.2d 534. affirmed had been paroled and other had died, prior decision but modified opinion, and the Supreme where parties stipulated to intervention of Court granted certiorari in both actions. The Supreme another inmate as named party plaintiff Court, Mr. Justice White, held that prison inmates and fmther stipulated that such inmate do not have right to either retained or appointed had been brought before disciplinary counsel in disciplinary hearings; that permitting committee for infraction that could have adverse inference to be drawn from inmate's silence also lead to state criminal proceedings, at his disciplina1y proceeding is not, on its face, that he asked for and was denied attorney, invalid practice; that mandating confrontation and and that he was assigned to "segregation" cross-examination of witnesses at prison disciplina1y for unspecified number of days for proceedings effectively preempts area that has been infraction, such inmate had standing to left to sound discretion of prison officials; and that raise issues involved in action before where there was no evidence that prison inmates in Supreme Court. U.S.C.A.Const. Amend. one action were subject to "lesser penalty" of loss of 14. privileges, but rather it appeared that all were charged with "serious misconduct," requiring procedures such 45 Cases that cite this headnote as notice and opportunity to respond even when inmate is faced with temporary suspension of privileges was J3J Federal Courts premature. _= Constitutional rights, civil rights, and discrimination in general Judgments ofCoUJts of Appeals reversed.

Where state adult correction authority regulations, although concededly state Baxter v. Palmigiano, 425 U.S. 308 (1976)

law, diq not even mention right to are compelled in such proceedings counsel when charges brought were also to furnish testimonial evidence that crimes under state law and did not might incriminate them in later criminal suggest whether inmate 1s silence might proceedings, they must be offered be used against him in proceeding itself, whatever immunity is required to supplant complaint by prison inmate claiming privilege and may not be required to that disciplinmy hearing violated his waive such immunity. U.S.C.A.Const. due process rights did not mention Amend. 5. or challenge any rule o1· regulation of authority but asked that disciplinary 54 Cases that cite this headnote decision be declared invalid and its enforcement enjoined, statute requiring 171 Prisons convening of three judge court did not ."""· Statements, confessions, and appear to be applicable and thus Supreme admissions; sel [-incrimination Comt was not deprived of jurisdiction Where no criminal proceedings were on ground that case involved issues that pending against state inmate, state did should have been heard by three-judge not insist or ask that inmate waive his court subject to review on direct appeal.

Fifth Amendment privilege against self- U.S.C.A. ~ 2281. incrimination but notified him that he was Cases that cite this headnote privileged to remain silent if he chose, although his silence could be used against him, and his silence in and of itself was 141 Prisons insufficient to support adverse decision "''"" Counsel or other assistance by disciplinary board, permitting adverse Prison inmates do not have right to inference to be drawn from his silence either retained or appointed counsel in was not invalid practice. U.S.C.A.Const. disciplinary hearings. Amends. 5, 14.

200 Cases that cite this headnote I 084 Cases that cite this headnote

151 Prisons 181 Prisons -....... Counsel or other assistance ~= Discipline and misconduct State authorities were not in error in Disciplinary proceedings in state failing to advise prison inmate that he prisons involve correctional process and was entitled to counsel at disciplinary important state interests other than hearing and that state would furnish conviction for crime. counsel if he did not have one of his own since inmates do not have right to 9 Cases that cite this headnote either retained or appointed counsel in disciplinary hearings. 191 Constitutional Law ~· Silence Cases that cite this headnote Aside from privilege against compelled self-incrimination, in proper 161 Prisons circumstances silence in face of ~-o.. Statements, confessions. and accusation is relevant fact not barred admissiorfs; self-incrimination from evidence by the due process clause.

Prison disciplinaty hearings are not U.S.C.A.Const. Amends. 5, 14. criminal proceedings, but if inmates

Next Baxter v. Palmigiano, 425 U.S. 308 (1976) 96°S . Ci. ·155 ·r4'7""L~E<I2.<f8 f()" ~--·~·-·- -· --~"'~------~--~

I 08 Cases that cite this headnote 1131 Civil Rights .= Criminal law enforcement prisons II 01 Prisons Record in action by state prison inmates ·w.;.;. Statements, confessions. and alleging that procedures used in prison admissions; self-incrimination disciplinary proceedings violated their rights to due process and equal protection Permitting adverse inference to be contained no evidenc~::; of abuse of drawn from prison inmate's silence at discretion by state prison officials in disciplinary proceeding is not, on its face, connection with confrontation and cross- invalid practice. examination of witnesses at disciplinary Cases that cite this headnote proceedings. U.S.C.A.Const. Amend. 14.

97 Cases that cite this headnote 1111 Prisons .""'·' Cross-examination and confrontation 1141 Prisons Mandating confrontation and cross- >-.. Determination and disposition examination of witnesses at prison Where there was no evidence that named disciplinary proceedings, except where state prison inmates, who alleged that prison officials could justify their denial procedures used in prison disciplinary of such privileges on grounds that would proceedings violated their rights to satisfy court of law, effectively preempted due process and equal protection, were area that had been left to sound discretion subject to "lesser penalty" of loss of of prison officials. privileges but rather were charged with Cases that cite this headnote "serious misconduct," Court of Appeals acted prematurely to extent it required procedures such as notice and opportunity 1121 Prisons to respond even when inmate is faced .·"'""" Cross-examination and confrontation with temporary suspension of privileges.

Prisons U.S.C.A.Const. Amend. 14. >;c. Determination and disposition: statement of reasons 64 Cases that cite this headnote Since there is no general right to confront and cross-examine adverse witnesses at prison disciplinary proceedings, and since due to particular environment of prison setting it may be that certain facts **1553 Syllabus " relevant to disciplinary determination *308 Respondent state prison inmates in No. 74-1194 may not come to light until after formal filed an action for declaratory and injunctive relief hearing, such facts need not be excluded alleging that procedures used in prison disciplinary from consideration; however, allowing proceedings violated their rights to due process and consideration of such facts in no way equal protection of the laws under the Fourteenth diminishes requirement that there be Amendment. The District Court granted relief, and written statement by fact finder as to the Court of Appeals affirmed, holding that minimum evidence relied upon and reason for notice and a right to respond are due an inmate faced disciplinary action. even with a temporary suspension of privileges, that Cases that cite this headnote an inmate at a disciplinary hearing who is denied the privilege of confronting and cross-examining Baxter v. Palmigiano, 425 U.S. 308 (1976) 96-s~cc 155f 4frEa~.2d a10-~ "-~-~-----~-~-~.-~-·~ ---·~~·-~·-----~--~-~·~----~··· ~-~---·- ----·---~-~~-·----

witnesses must receive written· reasons or the denial (c) Mandating that inmates should have the privilege will be deemed prima facie evidence of abuse of of confrontation and cross-examination of witnesses at discretion, and that an inmate facing prison discipline prison disciplinary proceedings, except where prison for a violation that might also be punishable in officials can justify their denial of such privilege on state criminal proceedings has a right to counsel grounds that would satisry a comt of law, effectively (not just counsel-substitute) at the prison hearing. pre-empts the area that Wolff, supra, left to the sound Respondent state prison inmate in No. 74-1187, upon discretion of prison officials, and there is no evidence being charged with inciting a prison disturbance, was of abuse of such discretion by the prison officials in summoned before prison authorities and informed No. 74-1194. Pp. 1559-1560. that he might be prosecuted for a violation of state law, that he should consult an attorney (although the (d) Where there was no evidence that any of the attorney would not be permitted to be present during respondents in No. 74-1194 were subject to the "lesser the disciplinary hearing), and that he had a right to penalty" of loss of privileges, but rather it appeared remain silent during the hearing but that if he did that all were charged with "serious misconduct," the so his silence would be held against him. On the Court of Appeals acted prematurely to the extent it basis of the hearing, at which respondent remained required procedures such as notice and an opp01iunity silent, he was placed in "punitive segregation" for to respond even when an inmate is faced with a days. He then filed an action for damages and temporary suspension of privileges. Pp. 1560-1561. injunctive rei ief, claiming that the disciplinary hearing violated the Due Process Clause of the Fourteenth No. 74-1187,510 F.2d 534; No. 74-1194,510 F.2d Amendment. The District Court denied relief, but the 6 13, reversed.

Court of Appeals reversed, holding that an inmate at a prison disciplinary proceeding must be advised of his right to remain silent, that he must not be questioned Attorneys and Law Firms fu1iher once he exercises that right, that such silence Ronald A. Dwight, Providence, R. 1., for petitioners. may not be used against him at that time or in future proceedings, and that where criminal charges *309 *31 0 Stephen J. F01tunato, Jr., Pawtucket, R. 1., for are a realistic possibility prison authorities should respondent. consider whether defense counsel, if requested, should be permitted at the proceeding. Held: The procedures Opinion required by the respective Comts of Appeals are either Mr. Justice WHITE delivered the opinion of the Court. inconsistent with the "reasonable accommodation" reached in 1Yo1Jrv. Mc/Jonne/1, 418 U.S. 539,94 S.Ct. These cases present questions as to procedures 2963, 41 L.Ed.2d 935, between institutional needs and required at prison disciplinary hearings and as to the objectives and the constitutional provisions of general reach of our recent decision in Wolff v. McDonnell, application, or are premature on the basis of the case 418 U.S. 539,94 S.Ct. 2963.41 L.Ed.2d 935 (1974). records. Pp. 1556-1561. (a) Prison inmates do not "have a right to either retained or appointed counsel in disciplinary A. No. 74-1194 hearings." Wolff, supra, at 570,94 S.Ct. at 2981.41 L.Ed.2d at 959. P. 1556.

Jll J2J Respondents are inmates of the California penal institution at San Quentin. They filed an action under 42 U.S.C. s 1983 seeking declaratmy and (b) Permitting an adverse inference to be drawn injunctive relief and alleging that the procedures used from an inmate's silence at his **1554 disciplinary in disciplinary proceedings at San Quentin violated proceedings is not, on its face, an invalid practice, and their rights to due process and equal protection of there is no basis in the record for invalidating it as the laws under the Fourteenth Amendment of the' applied to respondent in No. 74-1187. Pp. 1556-1559.

Constitution. 1 After an evidentiary *311 hearing, Baxter v. Palmigiano, 425 U.S. 308 (1976) 96s~ct.155~47 L.Ed.id s1o the District Court granted substantial relief. Clutchette of the counsel-substitute provided for by prison rules v. Procunier. 328 F.Supp. 767 (N.D.Cal.l971 ). The and renlained *313 silent during the hearing. The CoUit of Appeals for the Ninth Circuit, with one judge Disciplinary Board's decision was that respondent be dissenting, affirmed, 497 F.2d 809 ( 1974), holding placed in "Punitive segregation" for 30 days and that that an inmate facing a disciplinary proceeding at San his classification status be downgraded thereafter.

Quentin was entitled to notice of the **1555 charges [3[ Respondent filed an action under42 U.S.C. s 1983 against him, to be heard and to present witnesses, to for damages and injunctive relief, claiming that the confront and cross-examine witnesses, to face a neutral disciplinary hearing violated the Due Process Clause and detached hearing body, and to receive a decision of the Foutteenth Amendment of the Constitution. 2 based solely ,on evidence presented at the hearing. The The District *314 Court held an evidentiary **I 556 court also held that an inmate must be provided with hearing and denied relief. The Court of Appeals for counsel or a counsel-substitute when the consequences the First Circuit, with one judge dissenting, reversed, *312 of the disciplinary action are "serious," such as holding that respondent "was- denied due process prolonged periods of" isolation." !d., at 821. The panel in the disciplinary hearing only insofar as he was of the Court of Appeals, after granting rehearing to not provided with use immunity for statements he reconsider its conclusions in light of our intervening might have made within the disciplina1y hearing, and decision in Wolff, supra, reaffirmed its initial judgment because he was denied access to retained counsel again with one judge dissenting but modified its prior within the hearing." 487 F.2d 1280, 1292 ( 1973 ). We opinion in several respects. 510 F.2d 613 (1975). The granted certiorari, vacated the judgment of the Court Court of Appeals held that minimum notice and a of Appeals, and remanded to that court for fUJther right to respond are due an inmate faced even with consideration in light of Wolff v. McDonnell, supra, a temporary suspension of privileges, that an inmate decided in the interim, 418 U.S. 908, 94 S.Ct. 3200.41 at a disciplinary helping who is denied the privilege L.Ed.2d 1155 ( 1974). On remand, the Court of Appeals of confronting and cross-examining witnesses must affirmed its prior decision but modified its opinion. receive written reasons for such denial or the denial 510 F.2d 534 (1974). The Court of Appeals held that "will be deemed p~ima facie evidence of abuse of an inmate at a prison disciplinary proceeding must be discretion," Id., at 616, and reaffirming its initial advised of his right to remain silent, that he must not view that an inmate facing prison discipline for a be questioned further once he exercises that right, and violation that might also be punishable in state criminal that such silence may not be used against him at that proceedings has a right to counsel (not just counsel- time or in future proceedings. With respect to counsel, substitute) at the prison hearing. We granted cettiorari the Court of Appeals held: and set the case for oral argument with No. 74-1187.

421 U.S.I010.95S.Ct.2414,44L.Ed.2d678(1975). "(I)n cases where criminal charges are a realistic possibility, prison authorities should consider whether defense counsel, if requested, should not be let into the B. No. 74-1187 disciplinmy proceeding, not because Wolff requires it Respondent Palmigiano is an inmate of the Rhode in that proceeding, but because Miranda (v. Arizona.

Island Adult Correction Institution serving a life 384 U.S. 436,86 S.Ct. 1602. 16 L.Ed.2cl 694 (1966)) sentence for murder. He was charged by correctional requires it in light of future criminal prosecution." !d., officers with "inciting a disturbance and disrupt(ion) at537. of (prison) operations, which might have resulted in a riot." App. 197 (No. 74-1187). He was summoned We granted cettiorari and heard the case with No. before the prison Disciplinary Board and informed that 74-1194.421 U.S. I 010,95 S.C!. 2414,44 L.Ed.2d 678 he might be prosecuted for a violation of state law, that (1975). he should consult his attorney (although his attorney was not permitted by the Board to be present during the hearing), that he had a right to remain silent during II the hearing but that if he remained silent his silence would be held against him. Respondent availed himself

Ne:~t Baxter v. Palmigiano, 425 U.S. 308 (1976) 96Tct155'C47CEd.2CfiHi5-~-·~~-~---~--·--··~·-····-·~·-·-·--- ..----···--------·-

In Wolffv. McDonnell, supra, drawing comparisons to Gagnon v. Scarpelli. 411 U.S. 778,93 S.Ct. 1756,36 *316 III L.Ed.2d 656 ( 1973), we said: Palmigiano was advised that he was not required 'The insertion of counsel into the (prison) disciplinary to testify at his disciplinary hearing and that he process would inevitably give the proceedings *315 could remain silent but that his silence could be a more adversaty cast and tend to reduce their utility used against him. The Court of Appeals for the First as a means to further correctional goals. There would Circuit held that the self-incrimination privilege of the also be delay and very practical problems in providing Fifth Amendment, made applicable to the States by counsel in sufficient numbers at the time and place reason of the Fourteenth Amendment, forbids drawing where hearings are to be held. At this stage of the adVerse inferences against an inmate from his failure development of these procedures we are not prepared to testify. The State challenges this determination, and to hold that inmates have a right to either retained or we sustain the challenge. appointed counsel in disciplinary proceedings." 418 As the Court has often held, the Fifth Amendment U.S .. at 570, 94 S.Ct., at 2981, 41 L.Ed.2d. at 959. "not only protects the individual against being involuntarily called as a witness against himself in Relying on Miranda v. Arizona, 384 U.S. 436, 86 a criminal prosecution but also privileges him not S.Ct. 1602. 16 L.Ed.2d 694 ( 1966), and Mathis v. to answer official questions put to him in any other United States. 391 U.S. I, 88 S.Ct. 1503,20 L.Ed.2d proceeding, civil or criminal, formal or informal, ( 1968), both Courts of Appeals in these cases where the answers might incriminate him in future held that prison inmates are entitled to representation criminal proceedings." Lefkowitz v. Turley, 414 U.S. at prison disciplinary hearings where the charges 70, 77, 94 S.Ct. 316, 322, 38 L.Ed.2d 274, 281 involve conduct punishable as a crime under state (1973). Prison disciplinary hearings are not criminal law, not because of the services that counsel might proceedings; but if inmates are compelled in those render in connection with the disciplinary proceedings proceedings to furnish testimonial evidence that might themselves, but because statements inmates might incriminate them in later criminal proceedings, they make at the hearings would perhaps be used in later must be offered "whatever immunity is required to state-court prosecutions for the same conduct. supplant the privilege" and may not be required to "waive such immunity." ld., at 85, 94 S.Ct.. at 326, Neither Miranda, supra, nor Mathis, supra, has any 38 L.Ed.2d, at 286; Garrity v. New Jersey. 385 substantial bearing on the question whether counsel U.S. 493, 87 S.Ct. 616, 17 L.Ed.2d 562 ( 1967); must be provided at "(p)rison disciplinary hearings Gardner v. Broderick, 392 U.S. 273, 88 S.Ct. 1913, (which) are not part of a criminal prosecution." Wolff 20 L.Ed.2d I 082 ( 1968); Sanitation Men v. Sanitation v. McDonnell. supra, 418 U.S., at 556. 94 S.Ct .. at Comm'r, 392 U.S. 280. 88 S.Ct. 1917, 20 L.Ed.2d 2979. 41 L.Ed.2d, at 956. The Court has never held, I 089 ( 1968). In this line of cases from Garrity to and we decline to do so now, that the requirements of Lefkowitz, the States, pursuant to statute, sought to those cases must be met to render pretrial statements interrogate individuals about their job performance admissible in other than criminal cases. or about their contractual relations with the State; [51 We see no reason to alter our conclusion insisted upon waiver of the Fifth Amendment privilege so recently made in Wolff that inmates do not "have not to respond or to object to later use of the a right to either retained or appointed counsel in incriminating statements in criminal prosecutions; disciplinary hearings." 418 U.S., at 570, 94 S.Ct., and, upon refusal to waive, automatically *317 at 2981,41 L.Ed.2d, at 959. Plainly, therefore, state terminated employment or eligibility to contract authorities were not in error in failing to advise with the State. Holding that the State could not Palmigiano to the contrary, I. e., **1557 that he was constitutionally seek to compel testimony that had entitled to counsel at the hearing and that the State not been immunized by threats of serious economic would furnish counsel if he did not have one of his reprisal, we invalidated the challenged statutes. own.

G Baxter v. Palmigiano, 425 U.S. 308 (1976) 96·s:ci 15sf.47I.£d.2a s1o -- ~~~~~-~--- ·· ~~-~~~- ····················-·~~-···-~--~---~-~-~~~

reflection of the evidentiary significance of the choice The Court has also plainly ruled that it is constitutional to remain silent. error under the Fifth Ame_ndment to instruct a jury in a criminal case that it may draw an inference of guilt from a defendant's failure to testifY about facts Had the State desired Palmigiano's testimony over relevant to his case. Griffin v. California, 380 U.S. 609, his Fifth Amendment objection, we can but assume 85 S.Ct. 1229, 14 L.Ed.2d 106 (1965). This holding that it would have extended whatever use immunity is paralleled the existing statutory policy of the United required by the Federal Constitution. Had this occurred States, id., at 612, 85 S.Ct., al 1232, 14 L.Ed.2d, at 108, and had Palmigiano nevertheless refused to answer, it and the governing statutory or constitutional rule in the surely would not have violated the Fifth Amendment overwhelming majority of the States. 8 J. Wigmore, to draw whatever inference from his silence that the Evidence 425-439 (McNaughton rev. 1961 ). circumstances warranted. Insofar as the privilege is The Rhode Island prison rules do not transgress concerned, the situation is little different where the the foregoing principles. No criminal proceedings are State advises the inmate of his right to silence but also or were pending against Palmigiano. The State has not, plainly notifies him that his silence will be weighed in contrary to Griffin, sought to make evidentiary use of the balance. his silence at the disciplinary hearing in any criminal 181 Our conclusion is consistent with the prevailing proceeding. Neither has Rhode Island insisted or asked rule that the Fifth Amendment does not forbid adverse that Palmigiano waive his Fifth Amendment privilege. inferences against parties to civil actions when they He was notified that he was privileged to remain silent refuse to testify in response to probative evidence if he chose. He was also advised that his silence could offered against them: the Amendment "does not be used against him, but a prison inmate in Rhode preclude the inference where the privilege is claimed Island electing to remain silent during his disciplinary by a party to a Civil cause." 8 J. Wigmore, Evidence hearing, as respondent Palmigiano did here, is not in 439 (McNaughton rev. 1961). In criminal cases, where consequence of his silence automatically found guilty the stakes are *319 higher and the State's sole interest of the infraction with which he has been charged. is to convict, Grifjin prohibits the judge and prosecutor Under Rhode Island law, disciplinary decisions "must from suggesting to the jury that it may treat the be based on substantial evidence manifested in the defendant's silence as substantive evidence of guilt. record of the disciplinary proceeding." Morris v. Disciplina1y proceedings in state prisons, however, Travisono, 310 F.Supp. 857, 873 (R.l.l970). It is thus involve the cotTectional process and important state undisputed that an inmate's silence in and of itself interests other than conviction for crime. We decline is insufficient to support an adverse decision by the to extend the Griffin rule to this context.

Disciplinary Board. In *318 this respect, this case is very different from the circumstances before the 191 It is impmtant to note here that the posJtJon Comt in **1558 the Garrity-Lefkowitz decisions, adopted by the Comt of Appeals is rooted in the where refusal to submit to interrogation and to waive Fifth Amendment and the policies which it serves. It e Fifth Amendment privilege, standing alone and has little to do with a fair trial and derogates rather without regard to the other evidence, resulted in loss than improves the chances for accurate decisions. of employment or opportunity to contract with the Thus, aside from the privilege against compelled self- State. There, failure to respond to interrogation was incrimination, the Court has consistently recognized treated as a final admission of guilt. Here, Palmigiano that in proper circumstances silence in the face of remained silent at the hearing in the face <?f evidence accusation is a relevant fact not barred from evidence that incriminated him; and, as far as this record reveals, by the Due Process Clause. Adamson v. CalifOrnia, his silence was given no more evidentiary value than 332 U.S. 46, 67 S.Ct. 1672, 91 L.Ed. 1903 (1947); was warranted by the facts surrounding his case. This United States ex rei. Bilokumsky v. Tod. 263 U.S. does not smack of an invalid attempt by the State 149, 153-154, 44 S.Ct. 54, 56. 68 L.Ed. 221, 223 to compel testimony without granting immunity or to (1923); Raffel v. United States, 271 U.S. 494,46 S.Ct. penalize the exercise of the privilege. The advice given 566,70 L.Ed.2d 1054 (1926); Twining v. New Jersey. inmates by the decisionmakers is merely a realistic 211 U.S. 78, 29 S.Ct. 14, 53 L.Ed. 97 (1908). See also United States v. Hale, 421 U.S. 171. 176-177,

Ne:.:t Baxter v. Palmigiano, 425 U.S. 308 (1976) s~cC1551,47CECI~za·s1 o-~-~-~-~~·· 95 S.Ct. 2133, 2136, 45 L.Ed.2d 99, 104 (1975); refusing to call a witness, whether it be for irrelevance, Gastelum-Quinones v. Kennedy, 374 U.S. 469, 479, lack of necessity, or the hazards presented in individual 83 S.Ct. 1819, 1824. 10 L.Ed.2d 1013. 1020 (1963); cases." ld., at 566. 94 S.Ct., at 2980, 41 L.Ed.2d, at Grunewald v. United States. 353 U.S. 391.418-424, 956. 77 S.Ct. 963,981-984, I L.Ed.2d 931, 950-954 ( 1957).

Indeed, as Mr. Justice Brandeis declared, speaking We were careful to distinguish between this for a unanimous court in the Tad case, supra, which limited right to call witnesses and other due involved a deportation: "Silence is often evidence of process rights at disciplinary hearings. We noted the most persuasive character." 263 U.S., at 153-154, expressly that, in comparison to the right to call 44 S.Ct., at 56, 68 L.Ed., at 224. And just last Term witnesses, "(c)onfrontation and cross-examination in Hale, supra, the Cowt recognized that "(f)ailure present greater hazards to institutional interests." Id., to contest an assertion ... is considered evidence of at 567,94 S.Ct., at 2980,41 L.Ed.2d, at 957. We said: acquiescence ... if it would have been natural under the '"If confrontation and cross-examination of those circumstances to object to the assertion in question.'' furnishing evidence against the inmate were to be 422 U.S., at 176, 95 S.Ct .. at 2136, 45 L.Ed.2d, at allowed as a matter of course, as in criminal trials, there would be considerable potential for havoc inside the prison walls. Proceedings would inevitably be longer and tend to unmanageability." Ibid. *320 ** 1559 II 0 I The short of it is that permitting an adverse inference to be drawn from an inmate's silence at his disciplinary proceedings is not, on We therefore concluded that "(t)he better course at this its face, an invalid practice; and there is no basis time, in a period where prison practices are diverse in the record for invalidating it as here applied to and *322 somewhat experimental, is to leave these Palmigiano. 4 matters to the sound discretion of the officials of stateprisons." /d. at 569, 94 S.Ct., at2981, 41 L.Ed.2d, at 958.

IV **1560 Although acknowledging the strictures of Wolff with respect to confrontation and cross- In Wolff v. McDonnell, we held that "the inmate examination, the Court of Appeals for the Ninth facing disciplinary proceedings should be allowed Circuit, on rehearing in No. 74-1194, went on to to call *321 witnesses and present documentary require prison authorities to provide reasons in writing evidence in his defense when permitting him to do to inmates denied the privilege to cross-examine will not be unduly hazardous to institutional safety or or confront witnesses against them in disciplinary correctional goals." 418 U.S., at 566, 94 S.Ct., at 2979, proceedings; absent explanation, failure to set forth 41 L.Ed.2d, at 956. We noted that "(o)rdinarily, the reasons related to the prevention of one or more of the right to present evidence is basic to a fair hearing; but four concerns expressly mentioned in Wolff would be the unrestricted right to call witnesses from the prison deemed prima facie abuse of discretion. population carries obvious potential for disruption 1111 1121 1131 This conclusion is inconsistent and for interference with the swift punishment that with Wolff. We characterized as "useful," but did in individual cases may be essential to canying out not require, written reasons for denying inmates the the correctional program of the institution." Ibid. limited right to call witnesses in their defense. We The right to call witnesses, like other due process made no such suggestion with respect to confrontation rights delineated in Wolff, is thus circumscribed and cross-examination which, as was there pointed by the necessary "mutual accommodation between out, stand on a different footing because of their institutional needs and objectives and the provisions of inherent danger and the availability of adequate the Constitution that are of general application." !d .. bases of decision without them. See 418 U.S., at 556, 94 S.Ct .. at 2975. 41 L.Ed.2d. at 950. Within at 567-568, 94 S.Ct., at 2980-2981. 41 L.Ed.2d, the reasonable limitations necessary in the prison at 957-958. Mandating confrontation and cross- disciplinary context, we suggested, but did not require, examination, except where prison officials can justify that the disciplinary committee "state its reason for Baxter v. Palmigiano, 425 U.S. 308 (1976) 96S.cC 1551, 47 L.Ed.2<f8w--·-~-~~-~----~--~-----·---·--· -----~---~ ---~---·-·

their denial on one or more grounds that appeal to Appeals in Nos. 74-1187 and 74-1194 are either judges, effectively preempts the area that Wolff left to inconsistent with the "reasonable accommodation" the sound discretion of prison officials. 5 We add that reached in Wolff, or premature on the bases of the on the record before us *323 there is no evidence of records before us. The judgments in Nos. 74-1187 and the abuse of discretion by the state prison officials. 74-1194 accordingly are Reversed.

Judgments reversed.

v Mr. Justice STEVENS took no part in the [14[ Finally, the Court of Appeals for the Ninth consideration or decision of these cases.

Circuit in No. 74-1194 held that minimum due process Mr. Justice BRENNAN, with whom Mr. Justice such as notice, opportunity for response, and statement MARSHALL joins, concurring in pa11 and dissenting of reasons for action by prison officials was necessary in part. where inmates were deprived of privileges. 510 F.2d, at 615. We did not reach the issue in Wolff; indeed, we I agree that consideration of the procedural safeguards said: "We do not suggest, however, that the procedures necessary where an inmate is deprived only of required by today's decision for the deprivation of good privileges is premature on this record, and thus I join time would also be required for the imposition of lesser Patt V of the Court's opinion, which leaves open penalties such as the loss of privileges." 418 U.S., at whether an inmate may be deprived of privileges in the n. 19. 94 S.Ct., at 2982. 41 L.Ed.2d, at 960. Nor absence of due process safeguards. do we find it necessary to reach the issue now in light of the record before us. None of the named plaintiffs *325 Parts II and IV of the CoUJt's opinion simply in No. 74-1194 was subject solely to loss of privileges; reaffirm Wolff v. McDonnell. 418 U.S. 539, 94 S.Ct. all were brought before prison disciplinary hearings for 2963, 41 L.Ed.2d 935 ( 1974). I continue to believe allegations of the type of "serious misconduct," 418 that Wolff approved procedural safeguards sh011 of the U.S .. at 558, 94 S.Ct .. at 2975. 41 L.Ed.2d, at 952. minimum requirements of the Due Process Clause, and that we held in Wolff to trigger procedures therein I dissent from Parts II and IV for the reasons stated outlined. See n. 1, supra. Without such a record, we by my Brother Marshall, 418 U.S., at 580. 94 S.Ct .. at are unable to consider the degree of"liberty" at stake 2986, 41 L.Ed.2d. at 964. in loss of privileges and thus whether some sort of Pati Ill of the Comt's opinion, however, confronts an procedural safeguards are due when only such "lesser penalties" are at stake. To the extent that the Court of issue not present in Wolff 1 and in my view reaches Appeals for the Ninth Circuit required any procedures an erroneous conclusion. The Court acknowledges that in such circumstances, the Court of Appeals *324 inmates have the right to invoke the privilege against acted prematurely, and its decision on the issue cannot compulsory self-incrimination in prison disciplinary proceedings, Ante, at 1556, but nevertheless holds that stand. 6 "permitting an adverse inference to be drawn from an inmate's silence at his disciplinary proceedings **1561 We said in Wolff v. McDonnell: "As the is not, on its face, an invalid practice," Ante, at nature of the prison disciplinary process changes in 1558, and was proper in the circumstances of this future years, circumstances may then exist which will case. This conclusion cannot be reconciled with require further consideration and reflection of this the numerous cases holding that the government is Court. It is our view, however, that the procedures we barred from penalizing an individual for exercising have now required in prison disciplinary proceedings the privilege; precedents require the holding that if represent a reasonable accommodation between the government officials ask queStions of an individual interests of the inmates and the needs of the *326 to elicit incriminating information, as happened institution." 418 U.S., at 572. 94 S.Ct., at 2982. 41 here, the imposition of any substantial sanction on L.Ed.2d. at 960. We do not retreat from that view. that individual for remaining silent violates the Fifth However, the procedures required by the Courts of Amendment. That principle prohibits reliance on any

Next ,.-, Baxter v. Palmigiano, 425 U.S. 308 (1976) sct:1ssi~4TCEct2Cis1o~~ ~~~--~~~~~~~~~~~~ ···~ -~~-~~---~--·----~~·~···~-- ~~~~~-·

inference of guilt from the exercise of the privilege in 274, 282 (1973). See Maness v. Meyers, supra, 419 the context of a prison disciplinmy hearing. U.S., at 473, 95 S.Ct., at 597, 42 L.Ed.2d, at 592 (White, J., concurring in result).

Thus, the Fifth Amendment not only excludes from use in criminal proceedings any evidence obtained from As we have frequently and consistently recognized: the defendant in violation of the privilege, but also is "The constitutional privilege against self- operative before criminal proceedings are instituted: it incrimination has two primary interrelated **1562 bars the government from using compulsion to obtain facets: The Government may not use compulsion incriminating information from any person. Moreover, to elicit self-incriminating statements, see, E. g., the protected information "does not merely encompass Counselman .v. Hitchcock, 142 U.S. 547, 12 S.Ct. evidence which may lead to criminal conviction, but (35 L.Ed. I 110), and the Government may not includes information which would furnish a link in the permit the use in a criminal trial of self-incriminating chain of evidence that could lead to prosecution .... statements elicited by compulsion. See, E. g., Haynes Hoffman v. United States, 34 I U.S. 479.486,71 S.Ct. v. Washington, 373 U.S. 503, 83 S.Ct. 1336. 10 814,818,95 L.Ed. 1118, 1124 (195J).".Maness v. L.Ed.2d 513." Murphy v. Waterfi·ont Comm'n, 378 Meyers. supra. at 461, 95 S.Ct., at 592. 42 L.Ed.2d.

U.S. 52, 57 n. 6. 84 S.Ct. 1594, 1598, I 2 L.Ed.2d 678. at 585. And it is not necessary that a person be guilty (1964). of criminal misconduct to invoke the privilege; an innocent person, perhaps fearing that revelation of Indeed, only weeks ago we said that "the privilege information would tend to connect him with a crime he protects against the use of compelled statements As did not commit, also has its protection." 'The privilege well as guarantees the right to remain silent absent serves to protect the innocent who otherwise might be immunity." Garner v. United States, 424 U.S. 648. ensnared by ambiguous circumstances.' " Grunewald at 653. 96 S.Ct. I I 78, at I 182. 47 L.Ed.2d 370, at v. United States, 353 U.S. 391, 421, 77 S.Ct. 963, 376 ( 1976) (emphasis supplied). Malloy v. Hogan, 378 982, I L.Ed.2d 931, 953 (1957), quoting Slochower v. U.S. 1.84 S,Ct. 1489, I 2 L.Ed.2d 653 ( 1964), held that Board of Education, 350 U.S. 551,557-558,76 S.Ct. the Fifth Amendment the "essential mainstay" of our 637, 64 I, 100 L.Ed. 692, 699 ( 1956). See E. Griswold, "American system of criminal prosecution," ld., at 7, The Fifth Amendment Today I 0-22 (I 955); Ratner, 84 S.Ct., at 1493, 12 L.Ed.2d, at 659 protects "the right Consequences of Exercising the Privilege Against of a person to remain silent unless he chooses to speak Self~lncrimination, 24 U.Chi.L.Rev. 472 (1957). in the unfettered exercise of his own will, and to suffer Accordingly, the fact that no criminal proceedings no penalty ... for such silence." ld., at 8, 84 S.Ct., at were pending against Palmigiano, Ante, at 1557, I493, I2 L.Ed.2d, at 659. See Spevack v. Klein. 385 does not answer the crucial question posed by this U.S. 51 I, 514. 87 S.Ct. 625. 17 L.Ed.2d 574 (1967). case. The evidentiary *328 use of his statements As The Chief Justice noted last Tenn: "This Cowt in a criminal proceeding lurked in the background, has always broadly construed (the Fifth Amendment) but the significant element for this case is that the protection to assure that an individual is not compelled Fifth Amendment also prohibits the government from to produce evidence which later may be used against compelling an individual to disclose information that him as an accused in a criminal action." *327 Maness might tend to connect him with a crime. Maness v. Meyers, 419 U.S. 449,461. 95 S.Ct. 584,592,42 v. Meyers, supra, pointed up this distinction in its L.Ed.2d 574, 585 I 975). Further, "a witness protected recognition that availability of motions to suppress by the privilege may rightfully refuse to answer unless compelled testimonial evidence **1563 do not and until he is protected at least against the use of remedy the Fifth Amendment violation. 419 U.S., at his compelled answers and evidence derived therefrom 460, 463, 95 S.Ct., at 592, 42 L.Ed.2d, at 584. in any subsequent criminal case in which he is a defendant. Kastigar v. United Stales, 406 U.S. 441, 92 S.Ct. 1653,32 L.Ed.2d 212 (1972)." Lefkowitz v. I!

Turley. 4 I4 U.S. 70, 78, 94 S.Ct. 316, 322, 38 L.Ed.2d

Ne:d Baxter v. Palmigiano, 425 U.S. 308 (1976) g-ss:-ci--1ss(47T~Ecrza BTo-· -~-~-- ~~·

It was this aspect of the privilege that we relied on in Gardner v. Broderick, 392 U.S. 273, 88 S.Ct. 1913, a line of cases beginning with Garrity v. New Jersey, 20 L.Ed.2d I082 ( 1968), involved a policeman called 385 U.S. 493. 87 S.Ct. 616, 17 L.Ed.2d 562 (1967), to testifY before a grand jury investigating police and leading up to Lefkowitz v. Turley, supra. The corruption. He was warned of his constitutional right Court says today that "this case is very different," to refuse to give any incriminating information, but Ante, at 1557, but in my view the Garrity-Lefkowitz was also asked to waive immunity, and told that if he cases are compelling authority that drawing an adverse refused to do so, a state statute required that he be inference from an inmate's exercise of the privilege to discharged. He refused to waive immunity and was convict him of a disciplinary offense violates the Fifth discharged. Gardner invalidated the state statute on the Amendment. ground that the Fifth Amendment does not permit the government to use its power to discharge employees In Garrity policemen were summoned to testifY in to coerce disclosure of incriminating evidence. Jd., at the course of an investigation of pOlice corruption. 279, 88 S.Ct .. at 1916, 20 L.Ed.2d, at 1087. *330 They were told that they could claim the privilege, Sanitation Men v. Sanitation Comm'r. 392 U.S. 280, 88 but would be discharged if they did. Garrity held that S.Ct. 1917.20 L.Ed.2d 1089 (1968), decided the same imposition of the choice between self-incrimination day, turned on the same ground. 3 and job forfeiture denied the constitutionally required "free choice to admit, to deny, or to refuse to answer." **1564 Lefkowitz v. Turley, supra, 414 U.S. 70.94 Lisenba v. California, 314 U.S. 219,241, 61 S.Ct. 280, S.Ct. 316, 38 L.Ed.2d 274. the most recent decision 292. 86 L.Ed. 166, 182 ( 1947). Subsequent criminal involving noncriminal penalties for exercising the convictions were therefore set aside on the ground that privilege, concerned two architects summoned to the unconstitutionally compelled testimony should not testify before a grand jury investigating charges of have been admitted in evidence at trial. corruption relating to state contracts. They refused to waive the privilege, and a state statute provided that In Spevack v. Klein, supra, 385 U.S. 511, 87 S.Ct. such a refusal would result in cancellation of existing 625, 17 L.Ed.2d 574, decided the same day as Garrity, state contracts and ineligibility for future contracts for an attorney refused to honor a subpoena calling five years. The architects brought suit, claiming that for production of certain financial records; the sole the statute violated the privilege against compulsory basis for the refusal was the privilege against self- self-incrimination. The Court held that in the absence incrimination. He was disbarred for exercising the of a grant of immunity the government may not compel privilege, and *329 the disbarment was challenged in an individual to give incriminating answers. 414 U.S., this Court as infringing the Fifth Amendment. Relying on ,\fa/loy v. Hogan. supra, 378 U.S., at 8, 84 S.Ct., at 79, 94 S.Ct., at 323, 38 L.Ed.2d. at 282. A at 1493, 12 L.Ed.2d, at 659. Spevack held that the "substantial economic sanction" in the form of loss of privilege protects individuals against any penalty for contracts was held sufficient to constitute compulsion their silence and that its protection bars "the imposition within the meaning of the Fifth Amendment. ld., at 82, of any sanction which makes assettion of the Fifth 94 S.Ct., at324, 38 L.Ed.2d, at 284. The penalty, again Amendment privilege 'costly.'" 385 U.S., at 515.87 imposed in a noncriminal context, was held to infringe the Fifth Amendment.

S.Ct., at 629. 17 L.Ed.2d. at 577. 2 See Griffin v. California. 380 U.S. 609.614,85 S.Ct. 1229. 1232. 14 It follows that settled jurisprudence until today has L.Ed.2d I06, I09 ( 1965 ). Spevack expressly stated that been that it is constitutionally impermissible for the "(t)he threat of disbarment and the loss of professional government to impose noncriminal penalties as a standing, professional reputation, and of livelihood means of compelling individuals to forgo the privilege. are powerful forms of compulsion," 385 U.S .. at 516, The Court therefore begs the question by "declin(ing) S.Ct., at 628. 17 L.Ed.2d, at 578. and therefore to extend the ''33 I Griffin rule" to prison disciplinmy held that by inferring professional misconduct, and proceedings, ante, at 1558. Affinnance of the Court of penalizing that misconduct, solely on the basis of an Appeals' holding that reliance on an inmate's silence is invocation of the privilege, the State had violated the barred by the Fifth Amendment is required by Spevack.

Fifth Amendment. Gardner, Sanitation 1\len, and Lefkowitz.

Baxter v. Palmigiano, 425 U.S. 308 (1976) 96& cCT551~4ITECI2cf8Tif~ ~~ -··-· ~ ---~ -- ~~ -~ · ·- · ··-~······~-~- -~-··· ~~~

Lefkowitz. He was told that criminal charges might be The Court's attempted distinction of those cases plainly brought against him. He was also told that anything will not wash. To be sure, refusal to waive the privilege he said in the disciplinary hearing could be used resulted in automatic imposition of some sanction in against him in a criminal proceeding. 7 Thus, the all of those cases. The Court reasons that because possibility of self-incrimination was just as real and disciplinary decisions must be based on substantial the threat of a penalty just as coercive. Moreover, the record evidence, !'dorris v. Travisono, 310 F.Supp. Fifth Amendment does not distinguish among types 857. 873 (RI 1970), 5 and Palmigiano's silence "at or degrees of compulsion. It prohibits " 'inducement the hearing in the face of evidence that incriminated of any sort.'" Bram v. Unit~d States, 168 U.S. 532, him ... was given no more evidentia1y value than was 548, 18 S.Ct. 183, 189, 42 L.Ed. 568. 575 (1897). warranted by the facts surrounding his case," Ante, at "We have held inadmissible even a confession secured 1557, no automatic imposition of a sanction results, by so mild a whip as the refusal, under certain and therefore the use of such silence "does not smack circumstances, to allow a suspect to call his wife of an invalid attempt by the State to compel testimony until he confessed." Malloy v. Hogan, 378 U.S., at without granting immunity or to penalize the exercise 7, 84 S.Ct., at 1493, 12 L.Ed.2d, at 659. Palmigiano of the privilege," Ibid. was forced to choose between self-incrimination and punitive segregation or some similar penalty. Since the But the premise of the Garrity-Lefkowitz line was not Court does not oven·ule the Garrity-Lefkowitz group that compulsion resulted from the automatic nature of decisions, those precedents compel the conclusion of the sanction, but that a sanction was imposed that that this constituted impermissible compulsion. made costly the exercise of the privilege. Plainly the penalty imposed on Pahnigiano 30 days in punitive segregation and a downgraded classification made III costly the exercise of the privilege no less than loss of government *332 contracts or discharge from a The Court also draws suppmt from the "prevailing state job. Even accepting the Court's assertion that a rule that the Fifth Amendment does not forbid adverse disciplinary conviction does not automatically follow . inferences against parties to civil actions when they from an inmate's silence, in sanctioning reliance on refuse *334 to testify in response to probative silence as probative of guilt of the disciplinary offense evidence offered against them." Ante, at 1558. That charged, the Court allows prison officials **1565 to rule may prevail, but it did not have the approval of this make costly the exercise of the privilege, something Court until today. Some commentators have suggested Garrity-Lefkowitz condemned as prohibited by the that permitting an adverse inference in some civil cases Fifth Amendment. For it cannot be denied that the violates the Fifth Amendment. Comment, Penalizing disciplinary penalty was imposed to some extent, if not the Civil Litigant Who Invokes the Privilege Against Self-Incrimination, 24 U.Fla.L.Rev. 541, 546 (1972); solely, 6 as a sanction for exercising the constitutional Comment, 1968, U.Ill.L.F. 75; Note, Use of **1566 privilege. See Griffin v. California, supra, 380 U.S. the Privilege Against Self-Incrimination in Civil 609,85 S.Ct. 1229, 14 L.Ed.2d 106; United States v. Litigation, 52 Va.L.Rev. 322 (1966). I would have .Jackson . .190 U.S. 570, 581-582, 88 S.Ct. 1209, 1216, difficulty holding such an inference impermissible 20 L.Ed.2d 138. 146 ( 1968). That plainly violates the in civil cases involving only private pmties. But I Fifth Amendment. would hold that compulsion violating the privilege is It is inconsequential that the State is free to determine present in any proceeding, criminal or civii, where the probative weight to be attached to silence. Garrity- A government official puts questions to an individual Lefkowitz did not consider probative value, and with the knowledge that the answers might tend to other precedents deny the State power to attach any incriminate him. See Garner v. United States, 424 U.S. probative weight whatever to an individual's exercise at 653, 96 S.Ct. at 1181.47 L.Ed.2d at 376; Sanitation of the privilege, as I develop more fully in Part IV. Men v. Sanitation Comm'r, 392 U.S., at 284, 88 S.Ct.. at 1919.20 L.Ed.2d. at 1092. *333 The compulsion upon Palmigiano is as obvious as the compulsion upon the individuals in Garrity- Baxter v. Palmigiano, 425 U.S. 308 (1976) 96S.cC1551, 47 L.Ed.2cf8T6-··-· ··~~- immunity for any testimony given at disciplinary Such a distinction is mandated by one of the hearings. 8 fundamental purposes of the Fifth Amendment: to preserve our adversary system of criminal justice by preventing The government from circumventing that *336 **1567 IV system by abusing its powers. Garnerv. United States, supra. 424 U.S. at 653, 96 S.Ct. at 1182, 47 L.Ed.2d I would therefore affirm the judgment of the Court at 376. Only a few weeks ago, we said "That system of Appeals in No. 74· I I 87 insofar as that court held is undermined when a government deliberately seeks that an inmate's silence may not be used against to avoid the burdens of independent investigation by him in a prison disciplinary proceeding. This would compelling self-incriminating disclosures." Ibid. make unnecessary addressing the question whether "One of the most important functions of the privilege exercise of the privilege may be treated as probative is to protect all persons, whether suspected of crime evidence of quilt. Since the Comi, however, indicates or not, from abuse by the government of its powers of that invocation of the privilege is probative in these investigation, arrest, trial and punishment. It was not circumstances, Ante, at 1558-1559, I express my solicitude for persons accused of crime but the desire disagreement. For we have repeatedly emphasized that to maintain the proper balance between government such an inference has no foundation. Indeed, the very and the persons governed that *335 gave rise to the cases relied upon by the Court expose its error and adoption of these constitutional provisions." Ratner, support the conclusion that Palmigiano's silence could Consequences of Exercising the Privilege Against not be treated as probative.

Self-Incrimination, 24 U.Chi.L.Rev. 472, 484 (I957) United States ex rei. Biiokumsky v. Tod, 263 U.S. (footnote omitted).

149,44 S.Ct. 54, 68 L.Ed. 221 ( 1923), quoted Ante, at 1558, involved a deportation proceeding in which In a civil suit involving only private parties, no the deportee failed to deny that he was an alien. But patiy brings to the battle the awesome powers he also failed to claim or attempt to prove that he of the government, and therefore to permit an was a citizen. Alienage was not an element of any adverse inference to be drawn from exercise of the crime, and his silence was held probative of his *337 privilege does not implicate the policy considerations alienage. The inference was plainly permissible since underlying the privilege. But where the government the deportee faced no possibility of incrimination, and "deliberately seeks" the answers to incriminatory there was therefore no implication of the privilege. questions, allowing it to benefit from the exercise of But Palmigiano's predicament was that answers to the the privilege aids, indeed encourages, governmental questions put to him by the prison officials could circumvention of ou1· adversary system. In contrast, connect him with a crime. an affirmance of the judgment in Palmigiano's case The Court also quotes part of a sentence from United would further obedience of the government to the States v. Hale, 422 U.S. 171, 95 S.Ct. 2133, 45 commands of the Fifth Amendment. Cf. United States L.Ed.2d 99 (1975). We said in Hale that "(i)n most v. Karathanos, 531 F.2d 26, 35 (CA2 1976) (Oakes, J., circumstances silence is so ambiguous that it is of little concurring); Amsterdam, Perspectives on the Fourth probative force." Id., 419 U.S. at 176.95 S.Ct. at 2136.

Amendment, 58 Minn.L.Rev. 349 (1974).

45 L.Ed.2d at I 04. We also noted that its probative Nothing in this record suggests that the State does not force increases where a person "would be more likely use the disciplinary procedure as a means to gather than not to dispute an untrue accusation." Ibid. We evidence for criminal pros_ecutions. On the contrary, emphasized that "(f)ailure to contest an asse1iion, Palmigiano was told that he might be prosecuted, however, is considered evidence of acquiescence Only which indicates that criminal proceedings are brought if it would have been natural under the circumstances in some instances. And if the State does not intend to object to the assertion in question.'' Ibid. (emphasis to initiate criminal proceedings, the Fifth Amendment supplied). That was not the case since Hale's silence problem can be readily avoided simply by granting was in response to notice that he had a right to remain silent, and that any statements he made would be Baxter v. Palmigiano, 425 U.S. 308 (1976) 9ffS.ct15sf.. 47L.Ed.2ifsfa--·~--~··--~-·····-·-·----·-- ........- -...._ ..._ ..._._. __ _ used against him in court. These excerpts from Hale· against compuls01y self-incrimination in Harris v. require the conclusion that Palmigiano's silence also New York, 401 U.S. 222. 91 S.Ct. 643, 28 L.Ed.2d had no probative force. Palmigiano was also advised I ( 1971 ), the California Supreme Cow1 recently that he had a right to remain silent, that he might be construed Califomia's constitutional prohibition to prosecuted, and that anything he said could be used forbid use of an accused's inculpatory statement against him in court. obtained in violation of custodial interrogation safeguards announced in Miranda v. Arizona, 384 U.S. Finally, Grunewald v. United States, 353 U.S. 391, 436, 86 S.Ct. 1602. 16 L.Ed.2d 694 ( 1966). The court 77 S.Ct. 963. I L.Ed.2d 931 ( 1957), is particularly said, People v. Disbrow. 16 Cal.3d I 01. 113·115, 127 persuasive authority that Palmigiano's silence is not Cai.Rptr. 360, 368, 545 P.2d 272,280 ( 1976): "We ... probative. We there considered whether one Halperin's declare that Harris is not persuasive authority in any exercise of the privilege was probative of guilt, and state prosecution in Califomia. . . . We pause ... we concluded that his silence, in the circumstances, to reaffi1m the independent nature of the Califomia was "wholly consistent with innocence." Id., at 421,77 Constitution and our responsibility to separately define S.Ct .. at 982, I L.Ed.2d. at 952. "Halperin repeatedly and protect the rights of California citizens despite insisted ... that he was innocent and that he pleaded conflicting decisions of the United States Supreme his Fifth Amendment privilege solely on the advice Court interpreting the federal Constitution." 10 of counsel." !d .. at 422. 77 S.Ct .. at 983. I L.Ed.2d. at 953. Similarly, Palmigiano here maintained that *340 The fact that Palmigiano is a prison inmate he was innocent and that he claimed the privilege cannot, of course, distinguish this case from the cases on *338 the advice of counsel. Grunewald was a in the Garrity-Lefkowitz line, since "a prisoner does situation where "the Fifth Amendment claim was made not shed his basic constitutional rights at the prison before a grand jury where Halperin was a compelled, gate." Wolffv. McDonnell, 418 U.S., at 581, 94 S.CL and not a voluntary, witness; where he was not 2963. at 2987, 41 L.Ed.2d 935, at 965 (Marshall, J., represented by counsel; where he could summon no dissenting); see Jackson v. Bishop, 404 F.2d 571, 576 witnesses; and where he had no opportunity to cross- (CAS 1968) (Blackmun, J.). I must therefore view examine witnesses testifying against him." Ibid. That today's decision as another regrettable disregard ofMr. was similar to Palmigiano's situation; inmates have Justice Frankfurter's admonition that our interpretation only a very limited right to call witnesses, and an of the privilege **1569 is not faithful to the Founding even more limited right of cross-examination, Ante, at Fathers' purpose when it does not reflect the teaching 1559. Grunewald is thus most persuasive authority that of history: Palmigiano's silence was not probative. See **1568 Flint v. Mu lien, 499 F.2d I 00, I 03 (CA I ). cert. denied, "This command of the Fifth Amendment ... registers U.S. I 026. 95 S.Ct. 505. 42 L.Ed.2d 30 I (1974). 9 an important advance in the development of our liberty 'one of the great landmarks in man's struggle to make To accord silence probative force in these cases himself civilized.' Time has not shown that protection overlooks the hornbook teaching "that one of the from the evils against which this safeguard was basic functions of the privilege is to protect Innocent directed is needless or unwarranted. This constitutional men." Grunewald v. United States, supra, 353 protection must not be interpreted in a hostile or U.S. at 421. 77 S.Ct. at 982, I L.Ed.2d at 952 niggardly spirit. Too many, even those who should (emphasis in original). If this Comt's insensitivity be better advised, view this~ privilege as a shelter for to the Fifth *339 Amendment violation present wrongdoers. They too readily assume that those who in this case portends still more erosion of the invoke it are either guilty of crime or commit perjury privilege, state courts and legislatures will remember in claiming the privilege. Such a view does scant honor that they remain free to afford protections of to the patriots who sponsored the Bill of Rights as our basic liberties as a matter of state law. a condition to acceptance of the Constitution by the See ivtichigan v. Mosley. 423 U.S. 96, 120-121; ratifying States." Ullmann v. United States. 350 U.S. 96 S.Ct. 321, 332. 46 L.Ed.2d 313, 334 (1975) 422, 426-427. 76 S.Ct. 497, 500. I 00 L.Ed. 511, 518 (Brennan, J., dissenting). Contra1y to this Court's ( 1956) (footnotes omitted). interpretation of the Federal Constitution's privilege

Next ' Baxter v. Palmigiano, 425 U.S. 308 (1976) 96s~cc1ss1~47 c.td.2ds1o Parallel Citations 96S.Ct.I551,47L.Ed.2d810

Footnotes * The syllabus constitutes no part of the opinion of the Court but has been prepared by the Reporter of Decisions for the convenience of the reader. See United States v. Detroit Timber & Lumber Co., 200 U.S. 321. 337, 26 S.Ct.2R2, 287. 50 L.Ed. 499, 505.

Respondents John Wesley Clutchette and George L. Jackson brought suit "on their own behalf: and, pursuant to Rule 23(b){ I) and Rule 23(b)(2) of the Federal Rules of Civil Procedure, on behalf of all other inmates of San Quentin State Prison subject to defendants' jurisdiction and affected by the policies, practices or acts of defendants complained of herein." Plaintiffs' Amended Complaint, I Record 33 (No. 74- I I 94). The District Court treated the suit as a class action, Clutchette v. Procunier. 328 F.Supp. 767. 769-770 (N.D.Cal.l971 ), but did not certify the action as a class action within the contemplation ofFed.Rules Civ.Proc. 23(c)(l) and 23(c)(3). Without such certification and identification of the class, the action is not properly a class action. Indianapolis School Comm'rs v. Jacobs. 420 U.S. 128. 95 S.Ct. 848. 43 L.Ed.2d 74 (1975). We were advised at oral argument in No. 74-1194 that respondent Clutchette was paroled in 1972, two years after the suit was filed; counsel lOr respondents conceded that the case is moot as to him. Tr. of Oral Arg. (No. 74-1194), p. 34. We were further advised that respondent Jackson died after the suit was filed. However, the parties stipulated on June 21, 1972, to the intervention of Alejandro R. Ferrel as a named party plaintiff in the suit. 3 Record 285 (No. 74-1194). The parties further stipulated the facts that, like Clutchette and Jackson, Ferrel was an inmate at San Quentin who was brought before a disciplinary committee for an infraction that could have also led to state criminal proceedings, that he asked for and was denied an attorney at the hearing, and that he was assigned to ·•segregation.. for an unspecified number of days tOr the infraction. Ferrel, we were told at oral argument, is still incarcerated at San Quentin. Tr. of Oral Arg. 34 (No. 74-1194). He thus has standing as a named plaintiff to raise the issues before us in No. 74-1194.

2 The United States as Amicus curiae suggests that No. 74-1187 is not properly before the Court because the case involves the constitutionality of regulations of the Rhode Island Adult Corrections Authority and hence should have been heard by a three-judge court, subject to review here on direct appeal. The applicable regulations of the Authority when this case was brought had been promulgated as the result of a negotiated settlement of litigation in the District Com1 for the District of Rhode Island. Morris v. Travisono. 310 F.Supp. 857 ( 1970). It is conceded that they have become state law, and it would appear that they are of statewide effect. The rules on their face, however, although regulating in some detail the procedures required in prison disciplinary hearings, do not expressly grant or deny, or even mention, the right to counsel where charges brought are also a crime under state law. Nor do they suggest, one way or the other, whether an inmate's silence may be used against him in the proceeding itself Palmigiano's complaint did not mention or challenge any rule or regulation ofthe Authority; nor did it seek an injunction against the enforcement of any identified rule. What it asked was that the Board's disciplinary decision be declared invalid and its enforcement enjoined. Neither Palmigiano nor the State asked or suggested that a three-judge court be convened. It would not appear that the District Court considered the validity of any of the Authority's rules to be at stake. That court ruled Palmigiano was not entitled to be represented by counsel, not because the applicable mles forbade it but because it considered the controlling rule under the relevant cases was to this effect. The Court of Appeals, although quite aware that constitutional attacks on the Rhode Island prison rules might necessitate a three-judge court, see Souza v. Travisono, 498 f.2d 1120, 1121-1122 ((';\I 1974 ), evidently did not doubt its jurisdiction in this case. On the record before us, the provisions of28 U.S.C. s 2281 with respect to three-judge courts would not appear to be applicable.

3 The Court based its statement on 3A J. Wigmore, Evidences 1042 (Chadbourn rev. 1970), which reads as follows: ''Silence, omissions, or negative statements, as inconsistent: (I) Silence, etc., as constituting the impeaching statement.

A Jhilure to assert a fUct, when it would have been natural to assert it, amounts in effect to an assertion of the non- existence of the fact. This is conceded as a general principle of evidence (s I 071 infra ). There may be explanations, indicating that the person had in truth no belief of that tenor; but the conduct is 'prima facie' an inconsistency. ·'There are several common classes of cases: ·'(1) Omissions in legal proceedings to assert what would naturally have been asserted under the circumstances. ·'(2) Omissions to assert anything, or to speak with such detail or positiveness, when formerly narrating, on the stand or elsewhere, the matter now dealt with.

Ne:.;t Baxter v. Palmigiano, 425 U.S. 308 (1976) 96 S.Ct. 1551, 47L.Ed.2d 816-~~~--~----------·-·-------·--- ''(3) Failure to take the stand at all, when it would have been natural to do so. ·'In all of these much depends on the individual circumstances, and in all of them the underlying test is, would it have been natural for the person to make the assertion in question?" (Emphasis in original.) (Footnotes omitted.)

4 The record in No. 74-1187 shows that Palmigiano was provided with copies 9f the Inmate Disciplinary Report and the superior's investigation report, containing the charges and primary evidence against him, on the day before the disciplinary hearing. At the hearing, Captain Baxter read the charge to Palmigiano and summarized the two reports.

In the face of the reports, which he had seen, Palmigiano elected to remain silent. The Disciplinary Board's decision was based on these two reports, Palmigiano's decision at the hearing not to speak to them. and supplementary reports made by the officials filing the initial reports. All of the documents were introduced in evidence at the hearing before the District Court in this case. App. 197-202 (No. 74-1187).

5 The Court of Appeals also held, in its initial opinion (unmodified in rehearing with respect to this point), that ''the disciplinary committee must be required to make its fact finding determinations based solely upon the evidence presented at the hearing" in order "(l)or the right to confront and cross-examine adverse witnesses to be meaningful." 497 F.2d, at 820. Because we have held that there is no general right to confront and cross-examine adverse witnesses, it follows that the Court of Appeals' holding on this point must fall with its rejected premise. Due to the peculiar environment of the prison setting, it may be that certain facts relevant to the disciplinary determination do not come to light until after the formal hearing. It would be unduly restrictive to require that such facts be excluded from consideration, inasmuch as they may provide valuable information with respect to the incident in question and may assist prison officials in tailoring penalties to enhance correctional goals. In so stating, however, we in no way diminish our holding in Wolff that ''there must be a 'written statement by the fact finders as to the evidence relied on and reasons' for the disciplinary action.'' 418 U.S .. at 564, 94 S.Ct., at 2979. 41 L.Ed.2d, nL 955.

6 Petitioners in No. 74-1194 have not challenged the holdings of the Court of Appeals for the Ninth Circuit with respect to notice, 497 1'.2d, al 818. or to the right to be heard by a "neutral and detached" hearing body. !d .. at 820. Cf. 41 S U.S .. at 570-571, 94 S.Ct .. at 2981-2982. 41 L.Ed.2d. at 959-960. Because these holdings are no longer in issue, it is unnecessary for us to consider them.

I agree that No. 74- I 194 is not moot, since the intervening plaintiff(Ferrell) has a personal stake in the outcome of this litigation. But the citation oflndianapolis School Comm'rs v. Jacobs, 420 U.S. 128.95 S.Ct. 848,43 L.Ed.2d 74 { 1975), is inapposite. We held that case moot because the named plaintiffs no longer had a personal stake in the outcome, and the action had not been formally certified as a class action. Id .. at 129. 95 S.Ct .. at 849. 43 L.Ed.2d. at 77. We did not, however, hold that without such formal certification "the action is not properly a class action.'' Ante, at 1554 n. I.

Jacobs applies only to the determination ofmootness, and did not deal with whether, for example, a court of appeals may treat an action as a class action in the absence of formal certification by the district court. Moreover, the propriety of the certification need not be addressed, since there is a.plaintiJTwith a personal interest in the outcome. Youakim v. Miller, 425 U.S. 231, at 236-237 n, 2. 96 S.Ct. 1399. at 1402,47 L.Ed.2d 701. at 706-707.

2 Although this quotation is from the plurality opinion of four Justices, Mr. Justice Fortas, who concurred in the judgment, ·'agree( d) that Spevack could not be disbarred for asserting his privilege against self-incrimination," 385 U.S., at 520.

87 S.Ct.. at 631. 17 L.Ed.2d. at 581. thus providing a majority for that proposition. He wrote separately because he was ofthe view that state employees enjoyed a Jesser protection. He agreed with the result, however, becat1se Spevack like Palmigiano was not a state employee. Ibid. See (Jardncr v. Broderick. 392 U.S. 273.88 S.Ct. 1913,20 L.Ecl.2d I 082 ( 1968).

3 In Sanitation Men 15 sanitation employees called before the Sanitation Commissioner investigating alleged improprieties '-Vere told that a claim of the privilege as a basis for refusing to answer questions concerning their official duties would result in their discharge. Three employees answered and denied the charges, but when later called before grand juries refused to waive immunity and were discharged tbr doing so. The Court held that to put the employees to a choice between their constitutional rights and their jobs was compulsion that violated the privilege. 392 U.S., at 284.88 S.Ct .. at 1919,20 L.Ed.2d. at 1092.

4 ''(T)he State intended to accomplish what Garrity has specifically prohibited to compel testimony that had not been immunized." 414 U.S. ill 82. 94 S.Ct. at 325, 3::-1 L.Ed.2d at 284.

5 Although Morris imposes a substantialMevidence standard for appellate review of findings in disciplinary proceedings, nothing in that case supp011s the Court's assumption that an inmate's silence alone would not meet this evidentiary standard. Ante. at 1557; c1: Ante, at 1555 n. 2. But if silence alone provides an evidentiary premise sufficient for discipline, the Court's distinction of the Garrity-Lefkowitz cases crumbles. I therefore read the Court's opinion to imply

1'-Jext Baxter v. Palmigiano, 425 U.S. 308 (1976) 96·s.ct. 1551,-47l.Ed.Zd a1o ·-----· that the Fifth Amendment bars conviction of a disciplinary violation based solely on an inmate's silence. Tn No. 74-1187, petitioners concede that an inmate's silence, without more, would not be substantial evidence.

6 As the Court notes, the only evidence, other than Palmigiano's silence, before the Disciplinary Board consisted of written reports made by the prison officials who filed the initial charges against Palmigiano. On the whole, the record inspires little confidence that his silence was not the sole basis for his disciplinary conviction. At the hearing a prison official read the disciplinary charges to Palmigiano and then asked him: "What happened here, Nick?" Palmigiano's response was again to request the presence of counsel, which had previously been denied. When the renewed request was denied, Palmigiano stated that he would remain silent on the advice of counsel. The official thereafter asked: "Do you intend to answer any questions for the board?" Consistent with his earlier statement, Pahnigiano replied that he did not. The Board excused him from the hearing room; he was called back within five minutes and informed that he had been found guilty and sentenced to 30 days' punitive segregation, with a possible downgrade in his classification.

7 In this respect it is not clear that all of the Morris requirements were observed in Palmigiano's disciplinary hearing.

Under the prison's rules, each inmate must be advised that "statements he makes in his defense at a disciplinary hearing are probably not admissible for affirmative use by the prosecution at a trial." Brief for Petitioners in No. 74-1187, pp.

4-5. Pahnigiano, however, was told that anything he said could be used against him at a criminal trial. In any event, the uncertain warning required by the prison rules would hardly satisf)' constitutional requirements. Seen. 8, Infra. In this respect, the Cmut's holding that the prisoner has no right to counsel exacerbates the difficulty, for surely the advice of counsel is essential in this complex area. See Maness v. Meyers. 419 U.S. 449,95 S.Ct. 584.42 L.Ed.2d 574 (1975).

8 Although my view is that only transactional immunity can remove the self-incrimination problem, Piccirillo v. New York. 400 U.S. 548, 562.91 S.Ct. 520,527,27 L.Ed.2d 596,605 (1971) (Brennan, J., dissenting), that view is not presently the Jaw. See, E. g., Lefkowitz v. Turley, 414 U.S. 70, 84, 94 S.Ct. 316. 325, 38 L.Ed.2d 274. 285 (1973); Kastigar v. United States, 406 U.S. 441.92 S.Ct. 1653, 32 L.Ed.2d 212 (1972).

Although Rhode Island prison officials are not authorized by statute to grant immunity, my Brother White has suggested that a witness who fails to persuade a judge that a prospective answer is incriminatory ·'is nevertheless protected by a constitutionally imposed use immunity if he answers in response to the Uudge's) order and under threat of contempt.''

Maness v. Meyers. 419 U.S., at 474, Y5 S.Ct .. at 599. 42 L.Ed.2d. at 592 (concurring in result). See Fowler v. Vincent, 366 F.Supp. 1224, 1228 (S.D.N. Y.1973 ); Sands v. Wainwright, 357 F.Snpp. 1062, I 093 (M.D.Fln.l973). Although an inmate would not be testifying in response to a court order, his answers in response to questions of prison officials are nevertheless compelled within the meaning ofthe Fifth Amendment. Thus, there would be immunity for any statements given. The inmate must, however, be informed of the existence of the immunity. As my Brother White said, "a witness may not be required to answer a question if there is some rational basis for believing that it will incriminate him, at least without At that time being assured that neither it nor its fruits may be used against him." !Vfancss v. Meyers, supra. ll.S .. at 473. 95 S.Ct.. at 598. 42 L.Cd.2d. at 592. (emphasis in original).

9 The other cases cited by the Court likewise do not support a holding that Palmigiano's silence should have probative force. No self-incrimination problem was presented in Gastelum-Quinones v. Kennedy. 374 U.S. 469.83 S.Ci. 1819.

I 0 L.Ed.2d I 0 13 ( 1963). That case involved a deportation proceeding, and the subject of that proceeding remained silent, but not for Fifth Amendment reasons. Moreover, the Court held that ·'deportation is a drastic sanction'' and "must therefore be premised upon evidence ... more directly probative than a mere inference based upon the alien's silence." !d., at 479, 83 S.Ct.. at 1824, 10 L.Ed.2d, at 1020. We held that particular deportation order not based on substantial evidence. Id .. at480. 83 S.Ct .. at 1825. I 0 L.Ed.2d, at 1020. Similarly, the Court did not address any self-incrimination issue relevant to the instant case in Adamson v. CalifOrnia. 332 U.S. 46,67 S.Ct. 1672. 91 LEd. 1903 (1947), and Twining v. New Jersey. 211 U.S. 78. 29 S.Ct. 14. 53 L.Ed. 97 ( 1908). Those cases were based on the premise, overruled in Malloy v. 1-Iognn, 378 U.S. I. 84 S.Ct. 1489, 12 L.Ed.2d 653 (1964), that the Fifth Amendment protection against self-incrimination was not applicable to the States. Finally, whether Raffel v. United States. 271 U.S. 494. 46 S.Ct. 566. 70 L.Ed. I 054 ( 1926), remains Jaw is subject to much doubt. See United States v. 1-lalc. 422 ll.S. 171, 175 n. 4, 95 S.Ct. 2133.2136.45 L.Ed.2d 99, 104 (1975); United States v. Grunewald, 233 F.2d 556.575 (CA2 1956), (Frank, J., dissenting), rev'd, 353 U.S. 391,77 S.Ct. 963, I L.Ed.2d 931 (1957).

10 Other state courts have also rejected Harris as a matter of state constitutional law. Commonwealth v. Triplett, 462 Pa. 244. 341 A.2d 62 ( 1975); State v. Santingo. 53 1-Jaw. 254, 492 P.2d 657 ( 1971 ). In addition, admission of incriminating statements for impeachment purposes can be prohibited by statute notwithstanding the decision in Harris. Butler v. State. 493 S.W.2d 190 (Te.x.Cr.App. 1973). See United States v. Jordan, 20 U.S.C.tvLA. 614.44 C.M.R. 44 (1971).

Finally, it should be noted that there need not be a state constitutional counterpart to the Fifth Amendment or a specific statutory prohibition to reach this result; use of incriminating statements can be prohibited by a state court as a matter Baxter v. Palmigiano, 425 U.S. 308 (1976) 9EfS~Cf 155T; 47 L~E-Cf2d81Cf-----------------··------~----~«---~-~-·-----~~------ ----~----

of public policy in that State. See In rc Pillo, II N.J. 8. 93 A.2d 176 (1952); State v. Miller. 67 NJ. 229. 245 n. I. 337 A.2d 36, 45 n. I (1975) (Clifford, J., concurring in part and dissenting in part).

Next Tab 3 Boales v. Brighton Builders, Inc., 29 S.W.3d 159 (2000)

29 S.W.3d 159 West Headnotes (29) Court of Appeals of Texas, Houston (14th Dist.).

Ill Fraud Tom L. BOALES, Brenda K. Boales, Mark S. >"" Nature and form of remedy Coalme~, Lynn K. Coalmer, James W. Dunbar, Water Code provision, limiting Raynoldo Garcia, Laura P. Garcia, Shaun purchaser1s remedy for failure to provide C. Hills, Carla D. Hills, Linda Lanier, John required written notice to purchasers M. Simmons, Diane M. Simmons, Ronald that the prope11y could be subject to H. Vitulli, and Connie S. Vitulli, Appellants, utility district taxes, did not apply v. to preclude recovery by homeowners alleging that developer and builder BRIGHTON BUILDERS, INC., actively misrepresented reason for low George Wimpey, Inc., and George prope1iy taxes to induce them to purchase Wimpey Of Texas, Inc., Appellees. their homes. V.T.C.A., Water Code § 50.30 I (Repealed).

No. 14-99-00535-CV. July 6, 2000.

I Rehearing Overruled Sept. 21, 2000. Cases that cite this headnote Several homeowners sued developer and builders from whom they purchased homes, alleging fraud, fraud in 121 Appeal and Error· a real estate transaction, breach of warranty, violation ..,= Cases Triable in Appellate Cmni of the Deceptive Trade Practices Act (DTPA), When a trial court dismisses a case upon negligence, negligence per se, promissory estoppel, spe_cial exceptions for failure to state a and other causes. The 61 st District Comt, Harris cause of action, that issue of law is County, John Donovan, J., after first severing various reviewed under a de novo standard; the defendants and plaintiffs, entered summary judgment appellate court must accept as true all in favor of developer and a builder. Homeowners material factual allegations and all factual appealed. The Court of Appeals, Wittig, J., held that: statements reasonably inferred from the (I) notice provision of Water Code did not apply to allegations set forth in the respondenfs limit recovery by homeowners alleging that developer pleadings. and builder actively misrepresented facts about low utility district taxes to induce them to purchase their 6 Cases that cite this headnote homes; (2) similarity of representations by sales agents of both developer and builder as to why prope11y taxes 131 Statutes were so low was insufficient to raise a genuine issue Giving effect to statute or language: of material fact on issue of conspiracy; (3) genuine construction as written issue of material fact existed as. to whether builder Statutes and developer intended that homeowners rely on Context representations of sales agents, precluding summary judgment for builder and developer on homeowners 1 Statutes claim for promissory estoppel; and (4) release as to an , Superfluousness "'

adjacent easement did not release claims in this case; Court of Appeals must give full effect to and (5) homeowners were consumers under the DTPA. an unambiguous statute according to all of its terms and context.

Affirmed in part and reversed and remanded in part.

Cases that cite this headnote Boales v. Brighton Builders, Inc., 29 S.W.3d 159 (2000) ~~~----~----~-~----"--~--~~<N--•-----~--~-~-----~-- --~~~~------·~---~--~ ~~--- ~

[4[ .Judgment Cases that cite this headnote Sales of real and personal property Similarity of representations by sales [8[ Vendor and Purchaser agents of both developer and builder r- Recording and registration to home purchasers as to why property Nothing in state law requires sales taxes were so low amounted to no more and purchase agreements containing than a scintilla of probative evidence, provisions relating to plans to issue bonds and thus was insufficient to raise a and impose property taxes to be filed of genuine issue of material fact on issue of record. whether developer and builder conspired to defraud purchaser. Vernon's Ann.Texas 1 Cases that cite this headnote Rules Civ.Proc., Rule 166a(i).

2 Cases that cite this headnote [9[ Negligence ~""~ Violations of statutes and other regulations [51 Conspiracy r Nature and Elements in General Negligence per se tort claims are established when a plaintiff shows that An actionable civil conspiracy requires a defendant, without excuse, violates a a combination by two or more persons statute or ordinance setting an applicable to accomplish an unlawful purpose or to standard of care if the statute is designed accomplish a lawful purpose by unlawful to prevent an injury to that class of persons means. to which the injured party belongs.

3 Cases that cite this headnote I Cases that cite this headnote [6[ Conspiracy [1OJ Antitrust and Trade Regulation <'"' Nature and Elements in General *''~ Tortious conduct and negligence in The elements of civil conspiracy are (I) general two or more persons; (2) an object to Negligence be accomplished; (3) a meeting of minds ~= Standard established by statute or on the object or course of action; (4) regulation one or more unlawful, ovett acts; and (5) The Deceptive Trade Practices Act damages as the proximate result. facially does not establish an applicable Cases that cite this headnote standard of care for imposing liability based on negligence per se; the act, rather, is a comprehensive consumer- [7[ Conspiracy protection plan establishing its own .'-· Conspiracy to defraud penalties. V.T.C.A .. Bus. & C.§ 17.41 et A common purpose on part of developer seq. and builder to sell homes in subdivision, together with their failure to file 3 Cases that cite this headnote of record the purchase agreements containing alleged misrepresentations, [II[ .Judgment was not wrongful, and thus, purchasers _;..;;. Sales cases in general could not recover for civil conspiracy to Genuine issue of material fact existed commit fraud. as to whether developer and builder

Ne:·:t Boales v. Brighton Builders, Inc., 29 S.W.3d 159 (2000)

made certain misrepresentations to home purchaser that they intended purchasers JISI Release to rely upon and whether purchasers .·-~ Release of specific indebtedness or foreseeably relied on the representations, liability in general precluding summary judgment for builder Release executed by homeowners, by its and developer on purchasers' claim that, own language, concerned the builder's under doctrine of promissory estoppel, misrepresentations regarding an adjacent builder and developer were liable for easement, and thus, did not apply to purchasers' reliance on their alleged release homeowners' claims that builder's misrepresentation as to why district sale representative misrepresented why propetty taxes were low. district property taxes were low.

3 Cases that cite this headnote Cases that cite this headnote

I I 21 Estoppel JI6J Release .---O-' Future events; promissory estoppel ,"", General rules of construction Although promissory estoppel is usually a Releases must be construed like all other defensive plea, it can be used by a plaintiff contracts. as an affirmative ground of relief.

2 Cases that cite this headnote Cases that cite this headnote JI7J Release JI3J Estoppel ~-- General rules of construction Future events: promissory estoppel If a release is capable of a certain or The requisites of promissory estoppel definite legal meaning or interpretation, are (I) a promise, (2) foreseeability of then effect must be given to the reliance thereon by the promisor, and (3) parties' intentions as expressed within the substantial reliance by the promisee to his language of the release. detriment.

Cases that cite this headnote Cases that cite this headnote JISI Release 1141 Appeal and Error ,;;;-. General rules of construction /"" Striking out part of pleading A release will be construed in light of the Error in striking from plaintiff facts and circumstances surrounding its homeowners' pleadings their execution. contradefensive allegations regarding ratification, adoption, and estoppel 4 Cases thttt cite this headnote was harmless, considering that the counterdefenses could still be raised in 1!91 Release response to an future claim by defendant .--·· General release developer and builder that their sales A general, categorical release clause must agents lacked authority to make the be construed narrowly. representations that were the subject of the lawsuit. 3 Cases that cite this headnote I Cases that cite this headnote J20J Release Beales v. Brighton Builders, Inc., 29 S.W.3d 159 (2000)

.-· Scope and extent in general Apex doctrine did not apply to preclude Any claims not clearly within the subject deposition of general counsel for matter of a release are not discharged, builder in action by homeowners, where even if such claims existed at the time homeowners did not seek to depose him the release was executed; the releasing merely because his corporate position, but instrument must mention the claim to be rather because they alleged he had first- released. hand knowledge of certain facts.

2 Cases that cite this headnote ::?: Cases that cite this headnote

\21\ Appeal and Error \25\ Pretrial Procedure .~" Depositions, affidavits, or discovery .·-- Protective Orders Before Examination The Court of Appeals reviews a trial court's decision regarding a discovery- Privileged Communications and related protective order under an abuse of Confidentiality discretion standard. .;~~ Subject Matter: Particular Cases Requested deposition of general counsel Cases that cite this headnote for builder in action by homeowners as to the advice he gave to builder1s vice [22[ Privileged Communications and president during contract negotiations Confidentiality with developer and to builder's sales _... ~ Professional Character of representatives during training sessions Employment or Transaction on buyer disclosure and the Deceptive Trade Practices Act (DTPA) were likely The lawyer-client privilege extends to all protected by attomey-client privilege, matters concerning litigation or business warranting protective order. transactions, regardless of whether the matters are pertinent to the matter for I Cases that cite this headnote which the attorney was employed.

I Cases that cite this headnote \26\ Antitrust and Trade Regulation . -"- Consumers. purchasers, and buyers: consumer transactions 1231 Privileged Communications and Confidentiality Homeowners alleging that builder's .=· Communications from client to and developer's sale representatives attorney and from attorney to client misrepresented why district property taxes were low to induce them to purchase Under attorney-client privilege, the were complaining about an aspect of the statements and advice of the attorney real estate and the transaction involved, to the client are as protected as the and thus, were "consumers" within the communications of the client to the meaning ofDeceptive Trade Practices Act attomey. (DTPA). Y.T.C.A .. Bus. & C.§ 17.45(4).

Cases that cite this headnote Cases that cite this headnote 1241 Pretrial Procedure \27\ Appeal and Error Corporate ofticers, agents. and ~o.o.. Extent of Revie\V Dependent on employees Nature of Decision Appealed from

1 '!

Beales v. Brighton Builders, Inc., 29 S.W.3d 159 (2000)

On appeal, in the interest of judicial in favor of Brighton Builders, Inc., George Wimpey, economy, Comi of Appeals may review Inc., and George Wimpey of Texas, Inc. Because we grounds for summary judgment asserted find that the Water Code does not preclude some of at trial and preserved for appeal even if the homeowners' causes of action, we reverse and such grounds were -rejected by the trial remand for a trial on the merits of those claims. court. We also affirm multiple rulings by the trial court on discovery, special exceptions, and pmtial summary I Cases that cite this headnote judgment on conspiracy, effectively dismissing·many of the homeowners' other contentions.

1281 Antitrust and Trade Regulation r Purpose and construction in general The Deceptive. Trade Practices Act I. Background (DTPA) is designed to protect consumers from any deceptive trade practice made in Appellants allege that from 1992 to 1994, appellees connection with the purchase or lease of defrauded them on their new home purchases made goods or services. V .T.C.A., Bus. & C.* in the Aberdeen Trails subdivision. The subdivision 17.45(4). was in Municipal Utility District No. 14, which was established to provide water, sewer, drainage, I Cases that cite this headnote and flood control facilities in the district. Appellants complain that appellees told them that subdivision taxes were low because the utility district bonds !29J Antitrust and Trade Regulation already had been retired and that any future tax Real property in general increases were to be limited to increases to deal with The Deceptive Trade Practices the increased cost of maintenance. Appellants also Act (DTPA) can make actionable, allege that appellees told them that the utility district misrepresentations about real estate. encompassed certain nearby commercial properties Y.T.C.A., Bus. & C.§ 17.45(4). and that the taxes paid by these properties helped pay off the bonds and would help keep taxes low.

Cases that cite this headnote In reality, appellants allege in their suit, the district had not yet issued bonds when appellants purchased their homes. After appellants purchased their homes, the district issued bonds and assessed taxes to pay for Attorneys and Lnw Firms the bonds, increasing appellants' tax rate by 700% in *162 Joseph F. Nistico. Jr., W. Lance Stodghill, I 994. Appellants also complain that the commercial Richard Paul Martini, Houston, for appellants. properties mentioned by appellees fell outside the district.

C. Ed Harrell, Stacey Beth Saunders, Houston, for appellees. Appellants originally consisted of I I 7 individuals who sued the developer, Wimpey, and the builders from Panel consists of Chief Justice MURPHY and Justices whom they purchased their homes, Brighton and Perry HUDSON and WITTIG. Homes, a joint venture. Subsequently, in an attempt to expedite the resolution, the trial court severed the case, creating an "A" case involving the sale of eight OPINION homes in the subdivision. The trial cou1i then granted several special exceptions and motions for summary DON WITTIG, Justice. judgment dismissing all claims made against Perry Homes by Perry Homes homeowners Tom L. Beales, Tom L. Beales and multiple homeowners in Aberdeen Brenda K. Boales, James W. Dunbar, Shaun C. Hills, Trails subdivision appeal from ana-evidence summary Carla D. Hills, and Linda Lanier. The court then judgment and dismissal on special exceptions granted Boales v. Brighton Builders, Inc., 29 S.W.3d 159 (2000)

severed the claims of the Peny Homes homeowners in the "A" case into a "B" case so the judgment Section 50.30 I oft he Water Code requires any person would be final and appealable. The "B" cause came who proposes to sell or convey real prope1ty in a before this court as Boa/e.\' v. Peny Homes, a Joint utility district to provide written notice to purchasers 1-'en!ure, No. 14-98-00975-CV, 2000 WL 674922 that the property is in the district and may be subject (Tex.App.-Houston [14 th Dist.] May 25. 2000. to district taxes. See Act of May 29, 1989, 71 st no pet. h.) (not designated for publication). The trial Leg., R.S., ch. 935, § I, 1989 Tex. Gen. Laws 3977- court likewise granted several special exceptions and 78. 1 Section 50.301(n) of the code provides that the motions for summary judgment dismissing all of the remedies detailed in subsections (I ) and (m) are the claims made against Brighton and Wimpey. These exclusive remedies for violations of the section. See id. causes of action against Brighton and Wimpey were at 3979. Subsection (n) provides, in pat1, as follows: severed into this "C" case so the judgment would be final and appealable.

Notwithstanding any part or provision of the general The causes of action asserted by appellants are or special laws or the common law of the state to fraud, fraud in a real estate transaction, breach of the contra!)', the relief provided under Subsections warranty, violation of the Deceptive Trade Practices (/) and (m) shall be the exclusive remedies for a Act, negligence, negligence per se, promissory purchaser aggrieved by the seller's failure to comply estoppel, conspiracy to violate the section 32.47 of with the provisions of this section. the Penal Code, conspiracy to commit real estate ld [Emphasis added.] fraud, conspiracy to violate the DTPA, fraudulent 131 Under subsection (I) if the seller fails to comply inducement, and money had and received. Appellants with the provision of the section, the purchaser can *163 also assert a claim of breach of fiducia1y recover all of the costs relative to the purchase of the duty against Wimpey and breach of contract against prope1ty, plus interest and attorney's fees (rescission).

Brighton. Under subsection (m) the pul'chase!' can recover maximum damages of $5,000, plus attorney's fees.

See id We must give full effect to an unambiguous statute according to all of its tenns and context. See IJ. Discussion Liberly }fut. Ins. Co. v. Garrison Contractors, Inc .. 966 S. W.2d 482. 484 (Tex.l998).

A. Water Code Preemption The statute plainly limits the remedies but expressly In their second point of error, appellants complain only for failure to comply with the notice provisions the trial court erred in sustaining appellees' special of section 50.30 I. The substance of the plaintiff- exceptions on grounds that the Water Code preempted appellants' complaints is not that appellees failed to appellants' causes. We will deal with this question first comply with the notice requirements, but that appellees because this is the only issue advanced at trial that actively misrepresented facts to induce appellants to addresses all of the appellants' claims. purchase homes. Although appellees committed some technical errors in complying with section 50.30 I, When a trial court dismisses a case upon appellants do not complain primarily of appellees' special exceptions for failure to state a cause of failure to comply with that section. In fact, even had action, we review that issue of law under a de novo appellees complied with section 50.30 I, appellants standard. See ,)'anc!Jez v. /luntsvi/le lndep. Sch. /Jist .. would have a cause of action for misrep!'esentations 844 S.W.2d 286, 288 (Tex.App.-1-Iouston [I '' falling outside the purview of section 50.30 I.

Dist.j \992, no writ). We must accept as true all material factual allegations and all factual statements The Legislature did not express an intent that section reasonably inferred from the allegations set f01ih in the 50.30 I immunize property sellers from any liability respondent's pleadings. See Sorolw/;t v. Rhodes. 889 arising from all fraudulent acts committed during the S. \V.2d 239, 240 (Tex. 1994). sale of property within a utility district. We hold Beales v. Brighton Builders, Inc., 29 S.W.3d 159 (2000)

the Water Code does not preclude appellants' extra- a scintilla of evidence exists because such evidence statutOJy causes of action. We sustain appellants' lacks probative force, and in legal effect, is no evidence second issue. at all. See Kindred v. Con/Chem .. f11c., 650 S. \V .2d 61.

63 (Tex.l983 ).

[5[ [6[ An actionable civil conspiracy requires a B. Conspiracy combination by two or more persons to accomplish an [4[ In their first point of error, appellants complain unlawful purpose or to accomplish a lawful purpose by the trial court erred in granting pmtial summary unlawful means. See Alassey v. Armco Steel Co., 652 judgment to appellees *164 on appellants' claims S. W .2d 932, 934 (Tex.l983 ). The elements are (I) two of conspiracy to defraud, to defraud in a real estate or more persons; (2) an object to be accomplished; (3) transaction, and to violate the DTPA. Appellees moved a meeting of minds on the object or course of action; for summaty judgment on the conspiracy claims on (4) one or more unlawful, overt acts; and (5) damages grounds that: (I) the failure to file certain sale and as the proximate result. !d purchase agreements (discussed below) is not an unlawful act; (2) no case law suggests that violations [7[ As proof of a common object or purpose, of the DTPA, or real estate fraud can be the underlying appellants cite (I) the defendant-appellees' desire to tort to support a conspiracy claim; (3) plaintiffs cannot sell homes in the subdivision, (2) the substantially show a meeting of the minds to commit unlawfui'acts; identical misrepresentations, (3) the failure to file of and (4) there is no evidence of an object or common record certain sales and purchase agreements signed purpose to be accomplished, meeting of the minds on by appellees that stated that utility district bonds had common purpose, or one or more unlawful or overt not yet been sold and that provided that the agreements acts where the parties understood that the other patties were not to be filed of record. Defendant-appellees' shared a common purpose. common purpose to sell homes, the signing of sales and purchase agreements, and the failure to file those If, after adequate time for discovery, no probative agreements of record will not support a finding of evidence exists of one or more essential elements of a civil conspiracy. None of the acts is wrongful and the claim on which a party would have the burden of proof agreement to perform a lawful act cannot serve as the at trial 1 a no-evidence summmy judgment is proper. basis for a finding of conspiracy. See Times Herald See TEX.R. CIV. P. 166a(i); l:·sco Oil''· Sooner Pipe Pri111ing Co. v. .-UI. !Jelo Corp., 820 S.W.2d 206, & Sapp(v Cmp., 962 S.W.2d 193, 197 n. 3 (Tex.App. 216-17 (Tex.App.-Houston [14 111 Dist.] 1991. no -Houston [I 51 Dist.]1998. pet. denied). We review writ). Nothing is unlawful about selling homes, signing a no-evidence summary judgment under the same otherwise proper agreements, and failing to file those legal sufficiency standard as a directed verdict. See agreements of record when not otherwise required to Lampasas v. Spring Cir., Inc., 988 S.W.2d 428. 432 do so by law. The only evidence proffered to show a meeting of minds to commit unlawful activity is (Tex.App.--Houston [ 14 111 Dist.] 1999, no pet. h.) the substantially similar representations on the part We view the evidence in the light most favorable to of sales representatives of Brighton and Wimpey. the nonmovant, disregarding all contrary evidence and These sales representations, by non-principals, without inferences. See :\Jerrell !Jml' Pharmaceuaculs. Inc. v. more, constitute a mere scintilla of evidence of a Havner, 953 S.W.2d 706, 71 I (Tex.l997). We will meeting of minds of the principals to accomplish an sustain a no-evidence point if: (1) there is a complete unlawful purpose. Although appellees' sales people did absence of a vital fact, (2) we are barred by rules offer similar- *I 65 not identical-representations of law or evidence from giving weight to the only regarding why district taxes were low, this evidence evidence offered to prove a vital fact, (3) the evidence of unlawful common purpose, standing alone, is too offered is no more than a mere scintilla, or (4) the slight to support a conspiracy claim. The trial court did evidence offered conclusively establishes the opposite not err in granting partial summary judgment in favor of a vital fact. See Lampasas, 988 S.W .2d at 432. If the of appellees on the appellants' civil conspiracy claims. proffered evidence is so weak as to create no more than We overrule appellants' first point of error a "mere surmise or suspicion" of a vital fact, less than ., ' Boales v. Brighton Builders, Inc., 29 S.W.3d 159 (2000)

all conspiracy-related causes of action. We view the specific orders discussed here simply as additional grounds on which the trial court granted summary C. Failure to File Sale and Purchase Agreements judgment or special exceptions in favor of appellees In their third point of eJTor, appellants complain regarding conspiracy to violate the Penal Code and the trial collli erred in granting appellees' special the DTPA. We view the complained-of language as exceptions on appellants' conspiracy claims based the trial comt's explanation of why it acted and a on appellees' failure to file of record certain sales delineation of the legal issued being decided. We and purchase agreements between Brighton and discuss the issues here in the interest of judicial Wimpey. The trial court signed three orders-January economy. The trial court did not err in dismissing 23, 1998; January 30, 1998; and June 29, 1998 appellants' conspiracy claims that were based upon -dismissing appellant-plaintiffs' conspiracy claims appellees' failure to file the sale and purchase based on conspiracy to violate section 32.47 of the agreements. We overrule appellants' third point of Penal Code and the DTPA. The court included in its error. orders ce11ain language stating the court's belief that the failure to file the sale and purchase agreements did not violate the Penal Code or the Water Code. *166 D. Negligence Per Se Appellants do not appeal those particular portions of the orders dealing With the Water Code. The comt in In their foUith point of error, appellants complain its order of June 29, which related to Wimpey only, the trial court erred in dismissing their claims for also stated that the failure to file the sale and purchase negligence per se, based on violation of section 32.47 agreements did not violate the DTPA. of the Penal Code and the DTPA, and promiss01y estoppel. !81 Brighton and Wimpey signed cettain sales and purchase agreements containing provisions relating to 191 1101 Negligence per se t01t claims are plans to issue bonds and impose property taxes. The established when a plaintiff shows that a defendant, agreements fmther stated that the contracts were not without excuse, violates a statute or ordinance setting to be filed of record in the county property records. an applicable standard of care if the statute is designed Nothing in state law requires such agreements to to prevent an injury to that class of persons to which be filed of record. There could be any number of the injured par(y belongs. See U Chico Col)>. v. legitimate business reasons why the parties did not Poole. 732 S.W.2d 306.312 (Tex.l987). Because as wish to file their agreements of record. This failure to a matter of law, the acts complained of-the failure file, being a lawful act, does not constitute a violation to file the sale and purchase agreements-do not of the DTPA. As for section 32.47 of the Penal Code, 2 constitute a violation of the Penal Code, as alleged, this Penal Code section deals with the switching of such acts cannot constitute a basis for a negligence price tags or the alteration of a trade mark. It is not per se claim. The DTPA facially does not establish. intended to require parties to file business agreements an applicable standard of care for imposing liability of record when state Jaw does not otherwise require based on negligence per se. The act, rather, is a such filing. comprehensive consumer-protection plan establishing its own penalties. See Johnson v. Sawyer. 47 F.3d Appellants argue that the trial court's language stating 716, 729 (5 th Cir. 1995) (recognizing that Texas that the failure to file the agreements is not a has no law creating common law cause of action violation of the Penal Code or the DTPA are advis01y for statutory violation for which violation there is opinions. We construe the court's orders as either express and comprehensive statutory cause of action). summary judgment orders or dismissals on special Any presumed violation of the DTPA here does not exceptions related to certain conspiracy-related causes. constitute negligence per se sufficient to establish The failure of appellants to raise a material fact liability. We overrule appellants' fourth point of error. issue regarding meeting of the minds, discussed above, entitled appellees to summary judgment on

il:' Beales v. Brighton Builders, Inc., 29 S.W.3d 159 (2000) --~-----

455 (Tex.Civ.App.-Tyler 1971, no writ), nothing in the rules prohibits them from pleading such E. Promissory Estoppel issues. To the extent that the trial court dismissed Jill In their fifth issue, appellants complain the ratification, estoppel, and adoption as causes of action, trial comt erred in dismissing their claims based on it did not err. *167 To the extent that the trial promissory estoppel. Although the trial court does not court may have stricken from plaintiff-appellants' specifically state whether it was granting summary pleadings contradefensive allegations regarding the judgment or special exceptions as to promissory issues, it erred. Such error is harmless, however. estoppel, we presume the trial court acted on grounds See TEX.R.APP. P. 44.1. If appellees later asse11 a that plaintiff-appellants failed to state a cause of action. defense that the sales representatives lacked authority, appellants would be free at that point to counter the 1121 JI3J Although promissory estoppel is usually defense with pleadings and evidence of ratification, a defensive plea, it can be used by a plaintiff as an adoption, or estoppel. We overrule appellants' sixth affirmative ground of relief. See Donaldson v. Lake point issue.

Vista Comnnmify lmproveme11t Ass'n. 718 S.\V.2d 815. 818 (Tex.App.-Corpus Christi 1986. writ rel'd n.r.c.). The requisites of promissory estoppel are (I) G. Release a promise, (2) foreseeability of reliance thereon by the promisor, and (3) substantial reliance by the Jl5l In its seventh point of error, appellants complain promisee to his detriment. See E11glish v. Fischer, 660 that the trial court erred in granting partial summmy S. W.2d 521, 524 (Tex.\983). The misrepresentations judgment in favor of appellees as to Ronald and Connie alleged by appellants may not be promises in the strict Vitulli on grounds that the Vitullis had released any sense, that is, promises that the property taxes will claims against Brighton. not rise; however, plaintiff-appellants make clear in their pleadings their complaint. Appellants allege that The Vitullis allege that Leta Fitzgerald, a Brighton appellees made certain representations that appellees sales representative, made certain representations intended appellants to rely upon, that appellants regarding an easement adjacent to their property. The foreseeably relied on the representations, and that Vitullis on appeal allege that they signed a release appellees are estopped to deny the foreseeability of concerning only misrepresentations as to the easement. appellants' reliance. The trial court erred in dismissing Brighton agues that the release contains language appellants' claims based upon promissory estoppel. We releasing all claims against Brighton. sustain appellants' fifth issue.

The release provides, in part, as follows: WHEREAS, it has come to Brighton's attention F. Ratification, Estoppel, and Adoption lhat Leta Fitzgerald may have mistakenly advised the Purchasers [Vitullis] lhat nothing would be 1141 Appellants in their sixth point of error complain built adjacent to their fence behind the Property that the trial court erred in granting Wimpey's special since there was a Southwestern Bell Telephone Co. exceptions concerning ratification and adoption and easement behind their lot; and Brighton's special exceptions concerning ratification and estoppel. At the trial court level, appellees argued WHEREAS, improvements can be built on the that ratification, adoption, and estoppel are not causes commercial property between the Southwestern of action and should be dismissed. Appellants did Bell Telephone Company easement and the rear not plead the issues as causes of action but rather as property line of the Prope1ty, and contradefensive issues, that is, to counter any possible argument by appellees that the acts of their sales WHEREAS, without admitting liability or representatives could not be attributed to appellees. culpability, Brighton agrees to settle this Althongh appellants were not required to plead such misunderstanding ... issues, see ..\lcDonuld v. Clemens, 464 S.\~l.2d 450,

Ne:-:t Boales v. Brighton Builders, Inc., 29 S.W.3d 159 (2000)

from all possible misrepresentation claims. The trial court erred in granting summary judgment to Brighton as to the homeowner Vitullis on the grounds of release.

The Purchasers hereby RELEASE, ACQUIT AND We sustain appellants' seventh issue.

DISCHARGE Brighton ... from all matters, causes of action, accounting, suits, controversies, agreements, damages, claims and demands, known or unknown, arising out of pertaining to, or H. Protective Order associated with any statement by Leta Fitzgerald regarding the property. In their eighth point of error, appellants complain the trial comt erred in issuing a protective order The Purchasers intend "claim" to mean any and concerning plaintiffs' attempt to depose John Krugh, all demands, rights, claims, damages, exemplary general counsel for Perry Homes. After appellants damages, lawsuits, common law, federal statutory sought to depose Krugh, Perry Homes sought a or federal constitutional causes of action, costs, protective order on grounds that Krugh is an "apex" judgment, penalties, executions, and attorneys' employee and that any information sought is protected fees ... that they have or ever may have against by the lawyer-client privilege. Appellants countered Brighton that have arisen or ever may arise directly by arguing that Krugh is not an "apex" employee, that or indirectly out of !his claim. [Emphasis added.] even if he is an "apex" employee, he has unique and superior knowledge of discoverable facts, and that the I I 61 II 71 liS I JI 91 120 I Releases must bnaterial is not protected by the lawyer-client privilege. construed like all other contracts. See /Filliams v. G!ash. 789 S.W.2d 26 I (Tex.l990). If a release is 12IJ 1221 1231 We review a trial court's decision capable of a certain or definite legal meaning or regarding a discovery-related protective order under interpretation, then effect must be given to the parties' an abuse of discretion standard. See Blo.ved v. General intentions as expressed within the language of the Motors Corp.. 881 S. W.2d 422. 437 (Tex.App.- release. See Coker v. Coker, 650 S. \V.2d 391, 393 Texarkana I994), ajj'd, 916 S.W.2d 949 (Tex.l996). (Tex.I983). A release will be construed in light of Under the lawyer-client privilege, the client may refuse the facts and circumstances surrounding its execution. to disclose and may prevent any other person from See Trir.:entrol Oil hading, Inc:. v. Annesley. 809 disclosing confidential communications made for the S.W.2d 2I8. 221 (Tex.l991). A general, categorical purpose of facilitating rendition of legal services to release clause must be construed narrowly. See San us/ client. See TEX.R. EVID. 503(b); Keene Corp. v. New York !.!f"e Health Plan, Inc. v. Dube~,)'eybold--- Calchl'el/, 840 S.W.2d 7I5. 719 (Tex.App.Houston 5'uther/and ,Hanagement. Inc., 837 S.\V.2d 191, 197 [14 th Dist.] 1992, no writ). The privilege extends (Tex.App.-Houston [I st Dist.] I 992. no writ). Any to all matters concerning litigation or business claims not clearly within the subject matter of a release transactions, regardless of whether the matters are are not discharged, even if such claims existed at pertinent to the matter for which the attomey was the time the release was executed. ld The releasing employed. See /Filliams "· /Filliams, lOS S.W.2d 297, instrument must "mention" the claim to be released. 299 (Tex.Civ.App.-Amarillo 1937, no writ). The See l"'ictorht Bank & {rust Co. v. 11rac6 1, & 11 S.W .2d statements and advice of the attomey to the client are 931. 938 (Tex.l991 ). as protected as the communications of the client to the attomey. See Boring & Tunneling Co. of Am. v. Here, the release by its own language concerns Sa/a;ar, 782 S.W.2d 284,289 (Tex.App.-Houston [I the misrepresentations made regarding the adjacent st DisL] 1989. orig. proceeding). easement. Any claims Fitzgerald may have made about tax rates or whether certain commercial properties fell 1241 First, we note that the "apex" doctrine does within the district do not *I68 clearly fall within the not apply. Appellants do not seek to depose Krugh release nor are they mentioned in the release. We must merely because of his corporate position. Rather they construe the general release language narrowly and do seek to depose him because they allege he has first- not find that the parties intended to release Brighton hand knowledge of certain facts, that is, the advice he

l_j :::, Boales v. Brighton Builders, Inc., 29 S.W.3d 159 (2000) ~-~ ~-~-~---~·-~,-~~----~--~-----· -------~---· -~~~-~--~---~·~~-·-- --·~- -~- ~--------~·-·---·-·--~-~ -·~-

"consumer" status. See TEX. BUS. & COtvi.CODE gave to a Perry Homes vice president during contract ANN.§ 17.45(4) (Vernon 1987); Melody Home Mfg. negotiations between Peny Homes and Wimpey and Co. v. Barnes. 741 S.W.2cl 349. 35.1-52 (Tex.l987). to Perry Homes' sales representatives during training Additionally, the goods or services purchased must sessions regarding buyer disclosure and the DTPA. See form the basis of the plaintiffs complaint. See Melody .)'imonv. Bridewell, 950 S. W .2d 439. 442 {Tex.App.- Home, 741 S.W.2cl at 352. The DTPA is designed to \1../aco I997, no writ) ("apex" doctrine applies where protect consumers from any deceptive trade practice corporate officer has been noticed for deposition made in connection with the purchase or lease of goods merely because of officer's corporate position; an or services. See Cameron v. Terrell & Garrett. fm:., officer with first-hand knowledge of relevant facts 618 S.W.2d 535,541 (Tex.l981). Goods include real cannot avoid deposition because of"apex" status). property purchased or leased for use. See§ 17.45( 1).

1251 Under the lawyer-client privilege, the legal 1291 The DTPA can make actionable, advice given to Perry Homes employees and to misrepresentations about real estate. See Chastain v. the Perry Homes vice president during contract Koonce. 700 S. W.2d 579. 581 (Tex.l985) (purchasers negotiations with Wimpey likely are protected by the oflots, who complained of misrepresentations relating lawyer-client privilege. Although appellants argue that to other nearby lots, were "consumers" even though third-parties were at the training sessions between they complained about lots other than the lots Krugh and Perry Homes sales representatives and purchased); Sanchez v. Guerrero, 885 S. W.2d 487,490 thus the lawyer-client privilege does not apply, the (Tex.App.-El Paso 1994, no writ) (broker's failure record before us does not show that third patties were to mention that home's previous owner was child present during the sessions. Because the evidence molester supports finding of DTPA violation). Here, sought by appellants likely is significantly protected appellants complain about the tax rates on their homes by the lawyer-client privilege, the trial court did not and allege that appellees made misrepresentations to abuse its discretion by granting appellees' motion for a induce them to buy the homes. The appellants are protective order. We overrule appellants' issue. complaining about an aspect of the real estate and the transaction involved. See Chastain. 700 S.W .2d at 581. The trial court did not err in denying summary I. DTPA judgment in favor of appellees on grounds that appellants were not consumers under the DTPA. We 1261 In a single crosspoint, appellees complain the overrule appellees' single crosspoint. trial comt erred in denying their motion for summary judgment on grounds that appellants below as a matter *169 of\aw were not "consumers," as defined by the DTPA. III. Conclusion We sustain appellants' second, fifth, and seventh 1271 1281 On appeal, in the interest of judicial issues, and overrule all of appellants' other points. economy, we may review grounds for summary We overrule appellees' single crosspoint. We affirm judgment asserted at trial and preserved for appeal the trial court's judgment concerning all conspiracy- even if such grounds. were rejected by the trial court. related and negligence per se claims. We reverse See Cincinnati !.{fe Ins. Co. v. Cates, 927 S.W.2d the judgment as to all other causes of action and 623, 626 (Tex. I 996); Augusta Courl Co~Ownen,· 1

remand for a trial on the merits or other proceedings in Ass'n v. l.evin. Roth & 1\asner, P.C., 971 S.W.2d accordance with this opinion.

119, 123 (Tcx.App.~Houston [14th DisLJ 1998. writ denied). A DTPA plaintiff must plead and prove

Footnotes I Amending TEX. WATER CODE§ 50.301; current version at TEX. WATER CODE ANN. § 49.452 (Vernon 2000).

2 The Penal Code provides, in part, as follows:

Next Boales v. Brighton Builders, Inc., 29 S.W.3d 159 (2000)

it: (a) A person commits an offense with intent to defraud or harm another, he destroys, removes, conceals, alters, substitutes, or otherwise impairs the verity, legibility, or availability of a writing, other than a governmental record. (b) For purposes of this section, ·'writing'' includes: (I) printing or any other method of recording information; (2) money, coins, tokens, stamps, seals, credit cards, badges, trademarks; (3) symbols of value, right, privilege, or identification; and (4) labels, price tags, or markings on goods. * TEX. Pr:N.CODE i\NN. 32.47 {Vernon 1994).

. -····-··· -- -· Tab 4 In re BP Products North America Inc., Not Reported in S.W.3d (2006) ··················-··-··---~-- -·····-·-----~--·

We conditionally grant the petition for writ of 2006 WL 2192546 mandamus.

Only the Westlaw citation is currently available.

SEE TX R RAP RULE 47.2 FOR DESIGNATION AND SIGNING OF OPINIONS. 4 Bacl<ground MEMORANDUM OPINION On June I, 2006, the Plaintiffs notified BP of their Court of Appeals of Texas, intent to depose Manzoni. On June 6, BP moved Houston (1st Dist.). for protection and moved to quash the notice on the In re BP PRODUCTS NORTH grounds that Manzoni, a resident of London, England, AMERICA INC., Relator. was not subject to deposition in Texas. Footnoted in BP's motion was an objection to Manzoni's deposition No. 01-o6-oo613-CV. Aug. 4, 2006. on the grounds that Manzoni, an "upper level corporate official,'' was not subject to deposition under the Original Proceeding on Petition for Writ of Crown Central guidelines. BP stated that it would later Mandamus. file a brief in support of its objection. On June \4, the Plaintiffs moved to strike as legally insufficient Attorneys and Law Firms BP's motion to quash and BP's " 'Objection' to the Katherine D. MacKillop, Otway B. Denny, Stephen deposition of John Manzoni" because BP had not filed Fernelius, Graig J. Alvarez and James B. Galbraith, for the requisite affidavit by Manzoni.

BP Products North America Inc. On June 16, BP submitted its brief in suppm1 of its John Eddie Williams, Jim S. Hart, Collyn A. Peddie, apex objection and appended the affidavit ofManzoni, Byron iVI. Buchanan, James C. Dean, Brent W. Coon, which stated as follows, in pertinent part: Robert E. Ammons, Arturo J. Gonzalez and James D.

Nebout, for Plaintiffs' Steering Committee. 3. I am Chief Executive of Refining and Marketing of BP p.J.c. and have held this position since 2002.

Panel consists ofChiefJustice RADACK and Justices I am also a Group Managing Director of BP p.l.c.

ALCALA and HIGLEY. and have held this position since 2003. In my positions, I have global responsibility for refining and marketing and ultimate responsibility for 17 MEMORANDUM OPINION refineries, a similar number of chemical plants, 25,000 retail stations, pipelines and terminals. I ELSA ALCALA, Justice. rep011 directly to Lord Browne, who is Group Chief Executive ofBP p .I.e. and the highest official in BP *1 By petition for writ of mandamus, relator, BP p.J.c.

Products North America Inc., challenges the trial cow1's June 21,2006 order granting the motion of the Plaintiffs' Steering Committee ("Plaintiffs") 1 to strike 5. I am not a director, officer or employee of BP BP's " 'Objection' to and/or Motion for Protection Products North America Inc., an indirect wholly Regarding the Deposition of John Manzoni,'' Group owned subsidiary corporation of BP p.J.c .... BP Managing Director and Chief Executive of Refining Products North America Inc. owns and operates the and Marketing of BP p.J.c. 2 In its sole issue, BP Texas City Refinery. I do not manage or authorize contends that the trial court abused its discretion the day-to-day operations of BP Products North in striking the affidavit of Manzoni as insufficient America Inc. or of the Texas City Refinery. to invoke protection under the "apex doctrine" established in Crmv11 Cc~ntral Petroleum Corp. v. 6. I do not have unique or superior knowledge of Garcia. 904 S. W.2d 125 (Tex.\995). 3 information, much less unique or superior personal

...••.......••.... --·-··· ··-·-----~~---~----~---~----···----~--~ ·-·--··--~- ··--······-·· In re BP Products North America Inc., Not Reported in S.W.3d (2006)

knowledge, concerning the allegations made in the having knowledge conceming the accident and that he lawsuits arising out of the March 23, 2005 accident failed to state that he has" 'no knowledge of any facts at the BP Products N01th America's Texas City relevant' to this lawsuit as Crown Central and Alcatel Refinery. Information concerning the accident and require." In addition, the Plaintiffs filed a supplemental the investigation of the accident was provided to motion to strike, voicing the same contentions. me from employees of both BP p.J.c. and BP Products North America Inc. I did not participate On June 21, after a hearing, the trial comt granted the in the investigation of the March 23, 2005 accident. motion to strike, ordering that I therefore have no personal knowledge of facts relevant to the accident or the allegations made BP Products' Motion for in the lawsuits filed against BP Products North Protection for and/or objection America Inc. to the deposition of John Manzoni on alleged "apex'' *2 7. I have no unique personal knowledge of the grounds is stricken/denied/ Texas City facility or its operations, including any overruled because, in the safety issues or concerns. Information concerning exercise of the Court's the Texas City facility or its operations, including discretion, it finds that BP any safety issues or concerns was provided to me has failed to invoke properly from employees of both BP p.l.c. and BP Products that doctrine by failing to file North America Inc., including Michael Hoffman, an affidavit complying with Group Vice President for Refining, who rep01ts to Crown Central and Alcatel and me on these issues. has not, therefore, presented an issue for this Court to decide. In 8. Thus, the only knowledge I have concerning the addition, this Court specifically accident, the investigation of the accident and the finds that Mr. Manzoni has other allegations made against BP Products North admitted knowledge of relevant America Inc. is second hand. Ce11ainly, I do not facts of the case precluding possess relevant knowledge equal to or greater in reliance on Apex. quality or quantity than executives and employees of BP Products N011h America Inc. or other executives It is from this order that BP seeks mandamus relief. or employees of BP p.l.c.

9. After the March accident, BP Products North America Inc., in part with the aid of loaned Standard of Review personnel from affiliated companies, immediately A party is entitled to mandamus relief if a trial court began an investigation of the incident. That abuses its discretion or violates a legal duty and the investigation was performed by a group of highly party has no adequate remedy by appeal. Walker qualified and knowledgeable individuals, who were v. Packer. 827 S.W.2d 833, 839-40 (Tex.l992); /11 directed to use all resources to find the causes of re Ta)'lor. 113 S.W.3d 385, 389 (Tex.App.-Houston the accident and to report the causes to the public. [I st Dist.] 2003. orig. proceeding). A trial court All of these activities were at the direction of and abuses its discretion if "it reaches a decision so monitored by persons other than me, although l have arbitrary and unreasonable as to amount to a clear kept myself informed about the progress and results and prejudicial error of Jaw." Walker, 827 S.W.2d of the investigation.

839-40;see Taylor, 113 S.W.3d at 389. With respect to On June 19, BP filed a second motion for protection factual issues, matters are committed to the trial court's based on its objection and filed a response to Plaintiffs' discretion, and the reviewing court may not substitute motion to strike. On June 20, the Plaintiffs filed a its judgment for that of the trial court. rvalker, 827 brief in support of their motion to strike, objecting to S. \V.2d at 839: 7c(v!or, 113 S. W.3d at 389. The relator Manzoni's affidavit on the grounds that he admitted must establish that the trial court reasonably could have reached only one decision. IYalker, 827 S.W.2d In re BP Products North America Inc., Not Reported in S.W.3d (2006)

at 840. With respect to a trial court's determination of is a reasonable indication that the official 1s deposition legal principles, however, review is less deferential. is calculated to lead to the discovery of admissible /d.; '/(~Fior, 113 S.W.3d at 389. A trial comi has no evidence and (2) that less intrusive methods of discretion to incorrectly determine what the law is or discovery are insufficient, the trial court should modifY to improperly apply the law to the facts. H'ulker, 827 or vacate the protective order. !d.

S. \V .2d at 840. A clear failure by the trial court to analyze or apply the law correctly will constitute an Since Crown Central, the Texas Supreme Court has abuse of discretion and may result in an extraordinary clarified that it is improper to collapse the two discrete writ. !d. inquiries in Crown Central into a single test. A lea tel, II S. W.3d at 176. For instance, the Crown Central *3 Generally, the scope of discovery is within the guidelines should not be interpreted to require a party trial court's discretion. In re Colonial PipeUne Co., 968 seeking an apex deposition to show that the official to S.W.2d 938,941 (Tex. 1998). However, the trial court be deposed has unique or personal knowledge that is abuses its discretion if it issues a discovery order in an unavailable through less intrusive means./d. arbitrary or unreasonable manner, or without reference to guiding rules and principles. See id. If there has been At issue in the instant case is whether Manzoni 1s a clear abuse of discretion and there is no adequate affidavit is sufficient to invoke protection from remedy by appeal, mandamus will issue to correct the deposition under Crown Central. Pursuant to Crown order. !r;J. Mandamus relief is appropriate if the trial Central, the apex deposition guidelines are invoked court erroneously permits the deposition of an apex by including with a motion for a protective order, an official./n re Alcatel L".\11. Inc .. I I S. W.3d 173. 175-76 affidavit by the official "denying any knowledge of (Tcx.2000 ). relevant facts." Crown Cenlral. 904 S. W .2d at 128.

Here, the trial court found that BP failed to properly invoke the Crown Central doctrine because it failed "to file an affidavit complying with Crown Central and Apex Deposition A lea tel." In addition, the trial court found that Manzoni In ordering or preventing an apex deposition, a had admitted knowledge of relevant facts of the case, trial court must apply the guidelines set out in which precluded reliance on the apex doctrine.

Crown Centred Petroleum COJ'lJoration v. Garcia, 904 S.W.2d 125 (Tex.l995). In re Daisy Xi/g. Co .. 17 *4 The Plaintiffs contend that, because Manzoni's S.W.3d 654, 656 (Tex. 2000). Under Crown Central, a affidavit failed to specifically deny "any knowledge corporation may shield a high~ level corporate official of relevant facts," it was properly found to be from a deposition by filing a motion for a protective insufficient to invoke the apex doctrine. Specifically, order with an affidavit by the official "denying any the Plaintiffs contend that Manzoni's affidavit as knowledge of relevant facts." CroH'n Central, 904 insufficient because it uses the following qualifYing language: S.W.2d at 128. 5 The trial court detetmines the motion by first considering whether the proponent of 6. I do not have unique or superior knowledge of the deposition has "arguably shown that the official information, much less unique or superior personal has any unique or superior personal knowledge of knowledge concerning the allegations made in the discoverable information." /d. If the proponent fails lawsuits arising out of the March 23, 2005 accident to make such a showing, "the trial court should grant at the BP Products North America's Texas City the motion for protective order and first require the Refinery. Information concerning the accident and party seeking the deposition to attempt to obtain the the investigation of the accident was provided to discovery through less intrusive methods." !d. These me from employees of both BP p.l.c. and BP methods could include taking the depositions of lower~ Products North America Inc. I did not participate level employees or directing discovery requests to in the investigation of the March 23, 2005 accident. the corporation itself. !d. If, after making a good I therefore have no personal knowledge offacts faith effort to obtain the discovery through less relevant to the accident or the allegations made intrusive means, the proponent shows that ( 1) there In re BP Products North America Inc., Not Reported in S.W.3d (2006)

in the lawsuits filed against BP Products North Christi 1998, orig proceeding), as "the only reported America Inc. (Emphasis added). case involving a potential deponent who, like Mr. Manzoni here, admits knowledge about the case in 7. I have no unique personal knowledge of the Texas question." In Columbia, an official's affidavit "did City facility or its operations, including any safety not contain a broad denial of 'any knowledge of issues or concerns .... (Emphasis added). relevant facts" and denied only that he had "personal knowledge of many aspects of the lawsuit." !d.

In addition, the Plaintiffs contend that Manzoni admits The court held that the official's affidavit "failed to that he has knowledge regarding the matters at issue, satisfY the threshold requirement of Crown Central, as follows: to 'deny any knowledge of relevant facts." ' !d.

6 .... Information concerning the accident and the However, Columbia has been cited solely in apparent investigation of the accident was provided to me disagreement. 6 from employees of both BP p.l.c. and BP Products North America Inc .... BP contends that the affidavit is sufficient to invoke Crown Central because it properly denies knowledge 8. Thus, the only knowledge I have concerning the of relevant facts. Specifically, BP contends that, while accident, the investigation of the accident and the Manzoni's affidavit does not specifically deny "any other allegations made against BP Products North knowledge of relevant facts," the language in the America Inc. is second hand .... (Emphasis added). affidavit has been interpreted to satisfy Crown Central.

BP contends that Crown Central does not require the During the hearing on the motion to strike, the use of any "magic words." In addition, BP contends Plaintiffs raised the following as evidence that that the Plaintiffs failed in their burden to demonstrate, Manzoni has knowledge of relevant facts: (!) as required under Crown Central, that Manzoni has testimony that the Chemical Safety Board reported "unique or superior personal knowledge." Plaintiffs that one of the causes of the explosion was a lack respond that, because the doctrine was not invoked, the of corporate oversight and that Manzoni is "the guy burden never shifted to the Plaintiffs to show "unique in charge of corporate oversight" and (2) testimony or superior personal knowledge." that, the day after the explosion, Manzoni flew in from Great Britain and gave a press conference in Texas BP argues that, since Crown Central, there are City, during which he stated that "on behalf of the only a few cases in which appellate courts have corporate parent we take responsibility for this, we'll affinned refusals to quash apex depositions, citing get to the bottom of it and we'll fix it."

JI-IC Ventures I.. P. v. J·Ust Trucking, Inc .. 94 S.W.3d 762. 777-78 (Tex.App.-San Antonio 2002, no pet.)

In addition, the Plaintiffs presented to the trial court and In re Columbia Rio Grande J-Jealthcare. 977 for in camera inspection a letter from BP's CEO, S.W.2d 433,434 (Tex.App.-Corpus Christi 1998, orig Lord John Browne, to BP staff regarding the interim proceeding). conclusions and recommendations prepared by the team of personnel investigating the explosion ("Fatal In JHC, the appellate court upheld the trial court's Accident Repmt") stating that "! have asked John refusal to quash a deposition of an apex affidavit Manzoni to lead the next stage of implementation official because the trial court was within its discretion within the Refining and Marketing segment. He will to find that the company was "wrongfully resisting insure that all the changes necessary are made." discovery" of the official. .11/C, 94 S.W .3d at 777-78.

Further, Plaintiffs contend that BP's website states Importantly, in JHC, the patty wishing to depose that "When an explosion at the Texas City Refinery the apex official presented deposition testimony by in the U.S. killed 15 people and injured 170 last a witness who said that the apex official was the March, Manzoni handled the situation with care and "only person" with knowledge of relevant facts. /d. sensitivity."

The court's decision, therefore, was not premised on the adequacy of the apex official's affidavit, but *5 The Plaintiffs rely on In re Columbia Rio Grande rather on the evidence introduced that rebutted the 1/ea/rhcare. 977 S.W.2d 433, 434 (Tex.App.-Corpus

Next i ,, In re BP Products North America Inc., Not Reported in S.W.3d (2006) ------- contents of the affidavit. ld at 778. JHC, therefore, Texas City Refinery. (Emphasis is distinguishable from the situation before us. As added). discussed above, Columbia has been exclusively met with disagreement. See Texas Genco, 169 S.W.3d 766; El Paso Healthcare .~,·~.. 969 S.W.2d at 73.

We think that the better rule is that a mechanical 6. I do not have unique or superior knowledge of application of Crown Central in determining the information, much less unique or superior personal sufficiency of an affidavit to invoke the apex doctrine knowledge, concerning the allegations made in is to be rejected. See In re Texas Genco, 169 S.W.3d the lawsuits arising out of the March 23, 2005 764. 768 (Tex.App.-Waco 2005, orig. proceeding) accident at the BP Products North America's Texas (concluding that affidavit in which official attested City Refinery.lnformation concerning the accident that he had "no involvement in the operation or and the investigation of the accident was provided management of the [plant]" and had "no specialized or to me from employees of both BP p.l.c. and BP unique knowledge of the operations" and "no personal Products North America Inc. I did not participate knowledge ... other than what has been reported to in the investigation of the March 23, 2005 accident. me" was sufficient to invoke protection under Crown l therefore have no personal knowledge of facts Central doctrine); In re Burlington N. and Santa relevant to the accident or the allegations made Fe l(v. Co .. 99 S.Vv'Jd 323, 316 n. 3 {Tex.App.- in the lawsuits filed against BP Products North Fort Worth 2003. orig. proceeding) (concluding that America Inc. affidavit in which official attested that he had "no specific or superior knowledge with regard to the ... 7. I have no unique personal knowledge of the issue in the suit or with regard to any other aspect Texas City facility or its operations, including any of the case" was sufficient to invoke protection under safety issues or concerns. Information concerning Crown Central doctrine and explaining that there is the Texas City facility or its operations, including no requirement that a party must specifically recite any safety issues or concerns was provided to me language of Crown Central in an affidavit to show that from employees of both BP p./.c. and BP Products affiant has no knowledge of relevant facts); In re El North America Inc., including 1\1ichael Hoffman, Paso I lealthcare ,~J·c<.. 969 S.W.2d 68,73 (Tex.App.-EI Group Vice President for Refining, who reports to Paso 1998. orig. proceeding) (con~luding that affidavit me on these issues. in which official attested that he had no personal knowledge of the employees' jobs or of the day-to- 8. Thus, the only knowledge I have concerning the day administration was sufficient to invoke protection accident, the investigation of the accident and the under Crown CeniJ·al doctrine); A:HR Corp. v. F.nlow. other allegations made against BP Products North 926 S.W.2d 640,643-44 (Tex.App.-Fort Worth 1996, America Inc. is second hand. Certainly, I do not no pet.) (concluding that affidavit in which official possess relevant knowledge equal to or greater in attested that he had no "'personal knowledge of the quality ofquantity than executives and employees of conduct, actions, or events at issue," or "the training" BP Products North America Inc. or other executives employees received, or "the decisions related to or or employees ofBP p.l.c. procedures for changing" policies was sufficient to 9. After the March accident, ... [t]hat investigation invoke protection under Crown Central doctrine). was performed by a group of highly qualified and knowledgeable individuals .... All of these activities *6 Based upon an analysis of these cases, the were at the direction of and monitored by persons following specific statements in Manzoni's affidavit other than me, although I have kept myself informed constitute a sufficient denial of relevant facts to invoke about the progress and results of the investigation. protection under Crown Central: See Crown Central, 904 S. W.2d at 126: Texas Genco, 5.... do not manage S.W .3d at 768; Burlington Northern. 99 S.W.3d or authorize the day-to-day at 326 n. 3; El Paso J-lealthcare .~vs., 969 S.W .2d at 73; operations of BP Products Enlow, 926 S.W.2d at 643-44.

North America Inc. or of the

!'Je:d In re BP Products North America Inc., Not Reported in S.W.3d (2006) ..... ·- .......... -·~-···· _ ................. ---~·· · · · - ..................

Manzoni denied having any unique or superior Conclusion personal knowledge ofthe day-to-day operations of the Texas City refinery, of any safety issues or concerns, *7 We hold that the trial court abused its discretion or of the allegations at issue in the suit. Having in striking BP's affidavit. We therefore conditionally "some knowledge of discoverable information" does grant BP's petition for writ of mandamus, direct the not render an affidavit insufficient. A!cate!, 11 S. W.3d trial court to vacate its June 21, 2006 order striking at 179. We conclude that Manzoni sufficiently denied BP's affidavit, and direct the trial court to reinstate BP's any knowledge of relevant facts and that BP provided motion for protection. 7 We are confident that the trial the trial court with a sufficient affidavit under Crown court will promptly comply, and our writ will issue Central. See id. at I 75: Burling! on. 99 S.\V.3d at 326. only if it does not.

Footnotes The trial court appointed a Plaintiffs' Steering Committee to speak on behalf of claimants for purposes of resolving discovery matters prior to trial.

2 The respondent is the Honorable Susan E. Criss of the 212th District Court of Galveston County.

3 An ·'apex deposition'' is the deposition of a corporate officer who is at the top of the corporate hierarchy. Crown Cemra!

P,;otro!eum Corp. ''· Garcia, 904 S. W.2d 125. 126 ('r.::x.l995). Under the "apex doctrine," a corporate officer may be protected from deposition if the "'Crown Central guidelines" are met.ld.

4 The underlying suit is In re: Texas City E>.plosion March 23, 2005 Coordinated Discove1y Proceedings, No. 05- CV0337-A (212th Dist. Ct., Galveston County, Tex.).

5 Pursuant to the Texas Rules of Civil Procedure, "[a] person has knowledge of relevant facts when that person has or may have knowledge of any discoverable matter. The person need not have admissible information or personal knowledge of the facts.'' TEX.R. CIV. P. 192.3(c).

6 /11 rt~ Genco L.P., 169 S. \V.3d 764, 768 (Tcx.App.- Waco 2005, orig. proceeding); In re CenteJ]Joinr Energ)'. Inc., No. I 0-05-00244-CV. 2005 \VL 1531827, at *3 (Tex.App.- Waco 2005, orig. proceeding) (not designated for publication).

7 The merits ofBP's motion for protection are not before this Court; rather, this mandamus proceeding solely concerns whether the ai'Jidavit was properly stricken as insufficient to constitute proper support for a motion for protection under Crown Central. Having determined that the affidavit is sufficient, we reinstate the motion for protection and the trial court moves forward to hear and determine the motion. We conditionally grant BP's petition without prejudice to requesting relief on the motion for protection.

Ne:~t ') Tab 5 Butnaru v. Ford Motor Co., 84 S.W.3d 198 (2002)

A temporary injunction's purpose is to preserve the status quo of the litigation's KeyCite Yellow Flag- Negative Treatment subject matter pending a trial on the Distinguished by Lynd \'. I3ass Pro Outdoor World, Inc.• merits.

Tex.App.-Da!las, March 12, 2014 Cases that cite this headnote 84 S.W.3d 198 Supreme Court of Texas.

121 Jnjunction Hanan BUTNARU and ~= Extraordinary or unusual nature of Gil Butnaru, Petitioners, remedy v. A temporary InJunction is an FORD MOTOR COMPANY, Respondent. extraordinary remedy and does not issue as a matter of right.

No. 00-0513. Argued Feb. 14, 2001. I Decided June 27, 2002. 38 Cases that cite this headnote Potential buyers of automobile dealership filed action asserting claims against dealership, its shareholder, 131 Injunction and another potential buyer for breach of purchase ~'~ Issues, proot: and variance and sale agreements and claims against manufacturer To obtain a temporary injunction, the for tOttious interference. The 63rd Judicial District applicant must plead and prove three Court, Val Verde County, George M. Thurmond, J., specific elements: (I) a cause of action granted temporary injunction to prevent manufacturer against the defendant; (2) a probable right from exercising right of first refusal to buy dealership. to the relief sought; and (3) a probable, Manufacturer appealed. The Comi of Appeals, 18 imminent, and irreparable injury in the S. W.3ct 762, dismissed appeal in part, dissolved interim. temporary injunction, and remanded case. Potential buyers filed petition for review. The Supreme Court, 256 Cases that cite this headnote James A. Baker, J., held that: (I) amended provision of Motor Vehicle Commission Code granting Motor 141 Injunction Vehicle Board exclusive, original jurisdiction to .-= Irreparable injury regulate aspects of distribution, sale, and leasing of Injunction motor vehicles as governed by Code constitutionally v= Adequacy of remedy at law applied retroactively; (2) potential buyers' tortious interference and declaratory judgment claims fell Injunction oUtside purview of Board's exclusive jurisdiction, but /'"' Recovery of damages Board had primary jurisdiction over claims; and (3) An injury is irreparable, for purposes trial court did not abuse its discretion in issuing a of a temporary injunction, if the injured temporary injunction. party cannot be adequately compensated in damages or if the damages cannot Reversed and remanded. be measured by any certain pecuniary standard.

120 Cases that cite this headnote West Head notes (21) 151 lnjuuction Ill Injunction ~= Discretionary Nature of Remedy """'"· Preservation of status quo

~-~~--~-~~ ~---~~~~~·~-~~~

Ne:·:t , '!' ", -l iv ,- ':,c-1 iii:::: >>, ~-:c:---,:r,, l-'> ,,,, .• .,,,., 1: Butnaru v. Ford Motor Co., 84 S.W.3d 198 (2002) fex.Sup: Ct. nH6···- ··----~--~~--~-----·-·-·· ··~·~~~~--~-.--~-~--~-~-~-·-···~- .. ~------··-

Whether to grant or deny a temporary Vernon's Ann.Texas Civ.St. mt. 4413(36). injunction is within the trial comt's sound § 3.0 I (a). discretion.

4 Cases that cite this headnote Cases that cite this headnote J9J AntitJ"Ust and Trade Regulation Appeal and Error ~"""' Exclusive and Concurrent Remedies >- Injunction or Laws A reviewing court should reverse an order Antitl'ust and Trade Regulation granting injunctive relief only if the trial .= Exhaustion court abused that discretion. Although amended prov1s1on of Motor Vehicle Commission Code granted Cases that cite this headnote Motor Vehicle Board exclusive, original jurisdiction to regulate those aspects of 171 Appeal and Error the distribution, sale, and leasing of motor .-· Abuse of discretion vehicles as governed by Code, tottious A reviewing cou11 must not substitute its interference and declaratory judgment judgment for the trial court's judgment claims asserted by potential buyers of unless the trial court's action was so automobile dealership against dealership, arbitrary that it exceeded the bounds of its shareholder, and another potential reasonable discretion. buyer were not governed by Code and, thus, fell outside the purview Cases that cite this headnote of the Board's exclusive jurisdiction, such that potential buyers did not have Antitrust and Trnde Regulation to exhaust any administrative remedies JSJ _,~. Retroactive operation before raising claims in trial court.

Vernon's Ann. Texas Civ.St. art. 44 I 3(36), Statutes § 3.0 I (a). '-#·'"' Administrative agencies and proceedings 5 Cases that cite this headnote Statutes >"' Trade or business JIOJ Torts Amended provision of Motor Vehicle -= Contracts in general Commission Code granting Motor To establish their tortious interference Vehicle Board exclusive, original claim, potential buyers of automobile jurisdiction to regulate those aspects of dealership had to show: (I) a contract for the distribution, sale, and leasing of sale of dealership existed between them motor vehicles as governed by Code and dealership, its sole shareholder, and constitutionally applied retroactively in property owners; (2) dealership willfully action brought by potential buyers and intentionally interfered with that of automobile dealership against contract; (3) the interference proximately dealership, its shareholder, and another caused potential buyers damage; and (4) potential buyer; amended provision was buyers suffered actual damage or loss. jurisdictional statute that did not alter parties' rights or obligations or remove 49 Cases that cite this headnote any available remedies, and parties did not have vested right in choosing what tribunal would initially resolve all Jill Torts issues and claims governed by Code. Butnaru v. Ford Motor Co., 84 S.W.3d 198 (2002) rex:suP":' cCJ:9f6- -~~-- -·-· --------- .. · · - - - _,__. Defense, justification or privilege in Motor Vehicle Commission Code did general not abrogate any previously existing Defendant could defeat liability for common-law rights and, thus, trial cou11 tortious interference claim by proving the had immediate jurisdiction to adjudicate affirmative defense that its conduct was common-law claims for breach of the privileged or justified, so long as that purchase and sale agreements asserted by conduct was not illegal or tortious. potential buyers of automobile dealership against dealership, its shareholder, Cases that cite this headnote and another potential buyer. Vernon's Ann. Texas Civ.St. art. 4413(36).

1121 Antitrust and Trade Regulation Cases that cite this headnote "-~Judicial remedies prior to or pending administrative proceedings JISJ Antitrust and Trade Regulation Motor Vehicle Board had primary p- Particular cases jurisdiction over tortious interference and declaratory judgment claims asserted by Reliance by potential buyers of potential buyers of automobile dealership automobile dealership on general against dealership, its shareholder, and equitable principles did not relieve another potential buyer, which claims buyers of their burden to show raised Motor Vehicle Commission Code an inadequate legal remedy, in construction issue that was within Board's seeking tempora1y injunction against special competence and expe1iise; thus, manufacturer's exercising its right of first trial court should abate lawsuit and refusal to purchase dealership on the same suspend finally adjudicating tortious terms and conditions as proposed buyers. interference and declaratory judgment Cases that cite this headnote claims until Board had a reasonable opp011unity to act on the matter. Vernon's Ann.Texas Civ.St. art. 4413(36), § [161 Antitrust and Tntde Regulation 5.0\B(d). Pm1icular cases Evidence that potential buyers of Cases that cite this headnote automobile dealership would lose not only their right to purchase real 1131 Constitutional Law prope1ty, in addition to the dealership, if ~= Abrogation, modification, or manufacturer exercised its right of first recognition of remedies refusal was sufficient to establish that State Constitution's open courts provision potential buyers had a probable right to prohibits the Legislature from abrogating recove1y and that injunctive relief was well-established, common-law claims necessmy to preserve the status quo. unless the reason for doing so outweighs Cases that cite this headnote a litigant's constitutional right of redress.

Vernon's Ann.Texas Canst. Art. L § 13.

J171 Injunction Cases thal cite this headnote .~- Contracts Injunction [14[ Antitrust nnd Trade Regulation --- Breaches in general Exclusive and Concurrent Remedies Generally, a cow1 will not enforce or Laws contractual rights by injunction, because a party can rarely establish an irreparable Butnaru v. Ford Motor Co., 84 S.W.3d 198 (2002) 45 Tex. Sup. Ct. J. 916 ---- injury and an inadequate legal remedy when damages for breach of contract are Attorneys and Law Finns available. *200 Jonathan Scott Miles, Andrew L. Kerr, Holland Cases that cite this headnote & Knight LLP, San Antonio, Byron W. Hodge, Lowry Foster & Hodge, Del Rio, Larry G. Berkman, Jenkens & Gilchrist, San Antonio, for Petitioner.

JIB I Appeal and Error Injunction Paul S. Francis, Jon David lvey, Baker & Hostetler, Under an abuse of discretion standard Alfi·ed V. Sumpter, Oritz & Sumpter, Del Rio, for for reviewing an injunction, the court of Respondent. appeals cannot overrule the trial court's Opinion decision unless the trial court acted unreasonably or in an arbitrary manner, Justice BAKER delivered the opinion of the Court. without reference to guiding rules or principles. On December 6, 2001, we granted Ford's motion for rehearing. We withdraw our opinion dated July 7, Cases that cite this headnote 200 I, and substitute the following in its place.

Jl91 Appeal and Error In this case, we detetmine whether the Texas Motor .= Substituting reviewing court's Vehicle Board has exclusive jurisdiction over a judgment prospective car dealership transferees' claims that raise an issue about how to construe the Texas The comi of appeals cannot substitute its judgment for the trial court's reasonable Motor Vehicle Commission Code. 1 We conclude judgment even if it would have reached a the Board has exclusive jurisdiction to resolve only contrary conclusion. those claims and issues the Code governs. Moreover, we conclude that this exclusive jurisdiction does not Cases that cite this headnote extend to the prospective transferees' claims here, and thus, they do not have to exhaust administrative remedies before bringing their claims in the trial 1201 Appeal and Error court. Instead, because of the Board's special expe1tise ~"-· Reasonably supported findings in interpreting the Code, the trial comt should A trial cotut does not abuse its discretion abate the prospective transferees' to1tious interference if some evidence reasonably supports the and declaratory judgment claims so the Board may trial cou1t's decision. exercise its primary jurisdiction to *201 determine the Code construction issue raised with those claims.

152 Cases that cite this headnote We further conclude that the trial court did not abuse its discretion by entering a temporary injunction.

1211 Equity Accordingly, we reverse the court of appeals' judgment w""~ Prope1ty and rights therein in general and remand the cause to the trial court for further A trial comi may grant equitable relief proceedings consistent with this opinion. when a dispute involves real property.

I Cases that cite this headnote I. BACKGROUND Mm1in Graf is the sole shareholder of Graf Ford, Lincoln, Mercury, Inc., a dealership in Del Rio, Texas.

The dealership's agreement with Ford provides that if Graf Ford proposes to transfer the dealership, Ford

f'.Jext · '' 4 Butnaru v. Ford Motor Co., 84 S.W.3d 198 (2002) 45Tex. sup ct: J ~mr·~ shall have a right of first refusal to purchase the unenforceable and a declaration about the parties' dealership on the same terms and conditions that the rights and obligations under the agreements. Finally, proposed buyer agreed to, "regardless of whether the the Butnarus requested a temporary injunction to proposed buyer is qualified to be a dealer." A Ford prevent Ford or its assignees from exercising its right representative testified that this provision 1s purpose, of first refusal during the suit. Ford opposed this and the purpose of similar provisions in other standard request and filed a plea to the jurisdiction. Ford Ford dealership agreements, is "to be able to put argued that the Board has exclusive jurisdiction to into business dealers who [Ford feels] are qualified determine whether a manufacturer has violated the whenever [Ford has] the opportunity." Code's provisions. The trial com1 denied Ford's plea and granted the injunction. · In 1999, Hanan and Gil Butnaru contracted with Grafto buy the Graf dealership. They also contracted Ford sought interlocut01y review of the trial court's separately to buy the real property upon which tempormy injunction. See 18 S.\V.3d at 762. The the dealership was located. Graf and J.M. Barton court of appeals first noted that the Legislature did owned the property and executed that contract. not confer any rights on prospective transferees under Graf told the Butnarus about Ford's right of *202 the Code to seek relief for the Code violation first refusal. Additionally, both agreements were the Butnarus allege. Then, the court of appeals held "expressly conditioned upon approval by Ford of that the trial cou11 did not have jurisdiction over the Hanan Butnaru as a[sic] authorized sales and Butnarus' claims, "to the extent their claims are based service dealer" and warranted that neither agreement on violations of the [Code]," because the Code grants conflicted with any prior agreement to which Graf or the Board exclusive jurisdiction over alleged Code Barton were parties. violations. 18 S.W.3d at 767. The coUit also held that the Code does not violate the Texas Constitution's open In September I 999, Graf told Ford that he intended courts provision, which prohibits the Legislature from to sell the dealership to the Butnarus. The Butnarus unreasonably abrogating well-established common- then filed a Prospective Dealer Application with law claims. The court explained that the Code merely Ford, seeking approval as an authorized dealer. A confers new statutory rights on motor vehicle dealers month later, Ford informed Graf that it intended to and leaves "all others in the same position they exercise its right of first refusal and offered to pay the previously occupied." 18 S. W.3d at 768. Therefore, the Butnarus' reasonable expenses incurred in negotiating court concluded that "the Butnarus can sue Ford ... for the purchase and sale agreements. On the same day, tortious interference with contract, breach of contract, Ford assigned its right of first refusal to an existing and declaratory relief. They simply cannot base those Ford dealer. Ford and Graf agreed that Ford would causes of action on [Code] violations .... " 18 S.\V.3d at indemnify Graf against damages arising from Ford's 768. The court of appeals then remanded the claims exercising its right of first refusal and that Graf not based on Code violations and, holding that the would cooperate with Ford in defending any action Butnarus did not establish an inadequate legal remedy, challenging the right. dissolved the trial court's tempora1y injunction. 18 S.W.3d at 769-70.

Anticipating their breaching the purchase and sale agreements, the Butnarus sued Graf, Graf Ford, and The Butnarus petitioned this Court to review the Ba11on for breach of those agreements. The Butnarus court of appeals' opinion. Typically, jurisdiction over also sued Ford for t011iously interfering with the an order granting or denying a tempora1y injunction agreements. They alleged Ford tortiously interfered is final in the courts of appeals. See TEX. GOV'T because Ford's right of first refusal violates a Code CODE§ 22.225(b)(4). However, because the court of provision that prohibits a manufacturer from denying appeals' decision here conflicts with another court of or preventing a dealership transfer to a qualified appeals' decision, this Court has jurisdiction. See TEX. applicant. See TEX.REV.CIV. STAT. art. 4413(36), GOV'T CODE§ 22.225(c). Specifically, the COUI1 of §§ 5.01B(c). 5.02(b)(8). Thus, the Butnarus souglit appeals' holding that the Code does not violate the a declaration that Ford's right of first refusal was Texas Constitution's open courts provision conflicts Butnaru v. Ford Motor Co., 84 S.W.3d 198 (2002) 45-fex-sup ctT-916-. ------·-· · --- ·-·--·-·· with /)avid .\.fcDa\'id :Vissan. Inc. v. Subaru. Inc., 10 S.W.Jd 56, 68 (Tex.App.·Dallas 1999), affirmed in (a) The board has the part, reversed in part, and remanded on rehearing, 84 exclusive, original jurisdiction S.W.3d 21~ (Tex. 2002). In Dm:id McDavhf Nissan, to regulate those aspects of the the court of appeals held that the Code abrogated distribution, sale, and leasing of the plaintiffs common-law claims without reasonably motor vehicles as governed by substituting another remedy and thus contravened this Act and to do all things, the open com1s provision. I 0 S. W.3d at 67-68. We whether specifically designated granted the Butnarus' petition, as well as the petition in in this Act or implied herein, David McDavid Nissan, to resolve this conflict. or necessary or convenient to the exercise of this power At the time the trial courts and courts of appeals here and jurisdiction, including and in David AfcDavid Nissan determined whether the the original jmisdiction to Board had exclusive jurisdiction, section 3.01 of the determine questions of its own Code provided: jurisdiction.

(a) The board has the general and original power and TEX.REV.CIV. STAT. m1. 4413(36), § 3.01(a) jurisdiction to regulate all aspects of the distribution, (emphasis added). The Legislature made this sale, and leasing of motor vehicles and to do all amendment "effective immediately" after receiving things, whether specifically designated in this Act the necessary votes, which occurred on May 18, 200 I. or implied herein, or necessary or convenient to the See Act of May 18, 200 I, 77th Leg., R.S., ch. !55, § exercise of this power and jurisdiction, including 5, 2001 Tex. Gen. Laws 313, 317. The Legislature's the original jurisdiction to determine questions of amendment did not change section 3.0\(b). its own jurisdiction. In addition to the other duties placed on the board by this Act, the board shall Today, we determine (!) whether section 3.01 's enforce and administer the terms of Chapter 503, current or former version applies, (2) whether the Transportation Code. applicable provision grants the Board exclusive jurisdiction and how this affects the trial court's (b) Unless otherwise specifically provided by Texas jurisdiction here, and (3) whether the trial court abused law not in conflict with the terms of this Act, all its discretion by issuing a temporary injunction. aspects of the distribution and sale of motor vehicles shall be governed exclusively by the provisions of this Act.

IL APPLICABLE LAW TEX.REV.CIV. STAT. art. 4413(36). § 3.01 (Vernon Supp.!998), amended by Act of May 18, 200 I, 77th A. DAVID MCDAVID NISSAN, INC. Leg., R.S., ch. !55,§ 5, 2001 Tex. Gen. Laws 313.

1. Retroactive application of Section 3.01 In our original opinions in this case and in David McDavid Nissan, we concluded that this Today, in David klcDaFid Nissan, we held that section provision granted the Board primary-not exclusive- 3.0 I 's current version constitutionally retroactively jurisdiction over Code issues and claims. Moreover, applied to the pending claims a licensed motor vehicle we concluded that section 3.0 !(b) does not grant the dealer had raised against a manufacturer. Da\'id Board exclusive jurisdiction because, *203 by its JicDavid Nissan, 84 S.\V.3d at 218. We explained that plain language, that subsection only establishes that the this jurisdictional provision is procedural and remedial Code governs this area of law and trumps other laws if and did not affect a vested right. David McDavid they conflict with the Code. Nissan, 84 S.W.3d at 219 (citing Landgr(!(v. US/ Film Prod<., 511 U.S. 244, 273. 114 S.Ct. 1483 (1994); However, orily weeks before we issued our opinions, Baker Hughes, Inc. v. Keco, R & D. Inc., 12 S.\V .3d 1, the Legislature amended section 3.0 I (a) to provide: 4 (Tex.l999); City ofl)'/er v. Likes, 962 S.W.2d 489.

Butnaru v. Ford Motor Co., 84 S.W.3d 198 (2002) 4srex.

502 (Tex.l997); Ex parte .·/bell. 613 S. W.2d 255. 260 I I I 121 131 141 A tempora~y injunction's purpose (Tex.l981 ); McCain v. Yost, 155 Tex. 174.284 S.W.2d is to preserve the status quo of the litigation's subject 898. 900 ( 1955); Middleton v. Texas Power & Light matter pending a trial on the merits. IYa/ling v. Co .. 108Tex.96.185S.W.556,560(1916);Bionstein Metcalf"e, 863 S.W.2d 56. 57 (Tex. 1993); Electronic v. lilonstein. 831 S. W.2d 468,472 (Tex.App.-Houston Data 5j•s. Corp. v. Powell. 508 S.W.2d 137, 139 (14th Dist.] 1992. \\Tit denied); .':)outhwester/1 Bell (Tex.Civ.App.-Dallas 1974. no writ). A temporaty Tel. Co.''· City of"Koum=e. 543 S.W.2d 871.874-75 injunction is an extraordinary remedy and does not (Tex.C'iv.App.-Beaumont 1976, no writ)). issue as a matter of right. Walling. 863 S.W.2d at 57.

To obtain a temporary injunction, the applicant must plead and prove three specific elements: (1) a cause of action against the defendant; (2) a probable right to 2. Exclusive Versus Primary Jurisdiction the relief sought; and (3) a probable, imminent, and Furthermore, in David McDavid Nissan, we explained irreparable injllly in the interim. Walling. 863 S.W.2d the significant differences between the primary and at 57; Sun Oil Co. v. /Vhitaker, 424 S. W.2d 216, 218 exclusive jurisdiction doctrines. David i\1cDavid (Tex.l968). An injury is irreparable if the injured pat1y Nissan, 84 S.\V.3d at 218. We held that, unlike cannot be adequately compensated in damages or if the its former version, section 3.0 I(a) 's current version damages cannot be measured by any certain pecuniary expressly confers exclusive jurisdiction on the Board standard. Canteen Corp. v. Republic (?f Tex. Props .. to initially determine issues or claims that the Inc .. 773 S. W.2d 398, 40 I (Tex.App.-Dallas 1989, no Code governs. David McDavid Nissan, 84 S.W.3d writ). at 218. We based our decision on the provision's plain language, and the Legislature's intent when it lSI 161 171 Whether to grant or deny a temporary amended the provision to include the express exclusive injunction is within the trial coUit's sound discretion. jurisdiction language. David kfcDavid Nissan, 84 I-Va/ling. 863 S.W.2d at 58; State v. /Va/ker, 679 S. W.3d at 218. (citing Cash Am. !nt'l!nc. v. Bennett, 35 S. W.2cl484, 485 (Tex. 1984). A reviewing court should S. W.3d 12, 15 (Tex. 2000); Conrinental C~ffee Procb. reverse an order granting injunctive relief only if the Co. v. Co=are=. 937 S.W.2d 444. 447 (Tex. 1996); trial cow1 abused.that discretion. Walling. 863 S.W.2d SENATE COMM. ON STATE AFFAIRS, BILL at 58; lValker, 679 S.W.2d at485. The reviewing court ANAL YSlS, Tex. H.B. 1665, 77th Leg., R.S. (200 I)). must not substitute its judgment for the trial court's judgment unless the trial COUI1's action was so arbitrary that it exceeded the bounds of reasonable discretion.

Jolmsonv. Fourth Ct. a/Appeals, 700 S.W.2d 916.918 *204 3. Open Courts Challenge (Tex.l985); Davis v. Huey, 571 S.W.2cl 859,861--62 (Tex.l978).

In David k!c!Javid Nissan, we also concluded that, as applied to the motor vehicle dealer in that case, the Code did not violate the Texas Constitution's open cou11s provision. David 1\IcDcn•id Nissan. 84 S. W .3d at Ill. ANALYSIS 227; see also TEX. CONST. art. I.§ 13. We explained that the Board's exclusive jurisdiction over issues and A. WHETHER AMENDED SECTION claims the Code governs-all matters derived from 3.01 RETROACTIVELY APPLIES the Code and not the common law-did not abrogate any of the motor vehicle dealer's common-law rights.

181 In David i\IcDavid Nissan, we concluded Dal'id .HcDavid Nissan, 84 S.W.3d at 227 (citing that section 3.0 I (a), a jurisdictional provision, is Texas Ass'n qf Bus. v. Texas Air Control Bd, 852 a procedural and remedial statute that applied S. W.2d 440. 448 (Tex.l993 )). retroactively because it did not affect a vested right in that case. See David AfcDavid Nissan. 84 S.\V .3d at 219 (citing Landgraf," 511 U.S. at 273. 114 S.Ct. B. TEMPORARY INJUNCTIONS 1483; Likes. 962 S.W.2d at 502; Abell. 613 S.W.2d at ~60; Phil J-1. Pierce Co. v. IVatkins, 114 Tex. 153,263 Butnaru v. Ford Motor Co., 84 S.W.3d 198 (2002)

S.W. 905. 907 (1924); Middle/on. 185 S.W. at 560: tribunal will do this. See Landgraf, 511 U.S. at 273, !Jionstein, 831 S.W.2d at 472; City of Kountze, 543 114 S.Ct. 1483; David McDavid Nissan. 84 S.W.3d S. W.2d at 874-75). However, section 3.0 I (a) still may at 222; 1898454: Middle/on. 185 S. W. at 559: Cily not constitutionally retroactively apply in this case if it qf Konntoe. 543 S.W.2d at 874-75. Accordingly, we affects a vested right. See Baker Hughes, 12 S. W.3d at conclude that amended section 3.0 I(a) constitutionally 4; Middle/on. 185 S.W. at 560. applies retroactively in this case.

The Butnarus do not allege that section 3.0l(a) affects any vested right. Instead, they contend that the B. APPLYING SECTION 3.01'S CURRENT Legislature did not expressly make the amendment VERSION TO THE BUTNARUS' CLAIMS to section 3.0l(a) retroactive, and therefore, we should apply the Code Construction Act to conclude 191 Ford contends that section 3.0 I 's current section 3.0 I (a)'s current version does not retroactively version grants the Board exclusive jurisdiction, and apply. See TEX. GOV'T CODE §* 311.022 ("A thus, the Board has the sole authority to make statute is presumed *205 to be prospective in the initial determination about the alleged Code its operation unless expressly made retrospective."), violation here. The Butnarus, on the other hand, 311.031 ("[T]he ... amendment ... of a statute does not argue that section 3.01 does not oust the trial court's affect ... the prior operation of the statute or any prior jurisdiction because the Board does not have authority action taken under it."). to award damages for their well-established common- law claims. Therefore, the Butnarus assert that the But the Butnarus misplace their reliance on the Code Board only has prima~y jurisdiction to decide whether Construction Act. That statute applies only to "each Ford's right of first refusal violates the Code. code enacted by the 60th or subsequent legislature as pati of the state's continuing statutory revision The Butnarus 1 pleadings currently reflect four claims, program." TEX. GOV'T CODE § 311.002. When the first two of which are based on Ford's allegedly the Legislature recodifies a statute under Texas's violating the Code. First, the Butnarus seek a judicial continuing statutory revision program, the statute declaration that Ford!s right of first refusal violates the will indicate this. See, e.g., TEX. LOCAL GOV'T Code. Second, the Butnarus allege that Ford tortiously CODE § 1.00 I ("This code is enacted as a part of interfered with the purchase and sale agreements by the state's continuing statutory revision program .... "). attempting to exercise its allegedly invalid right of first And, though we refer to the Motor Vehicle Code refusal. Third, the Butnarus seek a declaration about as "the Code," nothing in the Code's language or the parties! rights and obligations under the purchase legislative history shows that it is pati of our State's and sale agreements. Fomih, the Butnarus claim that "continuing statutory revision program." TEX. GOV'T Graf and Bmion have breached or are about to breach CODE § 311.002; Robbins CheVJ·olel Co. v. Molor the purchase and sale agreements by permitting Ford Vehicle Bel.. 989 S. W.2d 865, 867 (Tex.App.-Austin to exercise its right of first refusal rather than requiring 1999. pet. denied); see also Knight l'. lnt'l Harvester Ford to determine the Butnarus! eligibility under the Credil Cmp .. 627 S. W.2d 382. 385 (Tex. 1982). Code for the dealership transfer.

Section 3.0 I(a) is a jurisdictional statute that, in this The court of appeals, after analyzing section 3.01 !s case, does not alter the patiies' rights or obligations former version, concluded that the Board has exclusive or remove any remedies already available. See David jurisdiction; *206 however, it held that the Butnarus McDavid Sisson. 84 S.W.3d at 222; Likes, 962 S. W.2d do not have standing as prospective car dealership at 502. This provision merely determines the tribunal transferees to seek relief from the Board for the Code that must initially resolve all issues and claims the violation they allege. The court of appeals further Code governs. See Landgrql 511 U.S. at 273, 114 determined that the Butnarus' lack of standing to obtain S.Ct. 1483; David McDavid Nissan. 84 S.W.3d at relief from the Board did not give them a right to seek 222: Cily qf Kmtnloe, 543 S.W.2d at 874-75. The damages for the alleged Code violation in the trial parties do not have a vested right in choosing what court. 18 S.W.3d at 767-68. Accordingly, the court

1'-Je:·:t Butnaru v. Ford Motor Co., 84 S.W.3d 198 (2002)

of appeals held that the Butnarus could maintain their to "fail to give effect to or attempt to prevent any sale breach of contract and tortious interference claims; or transfer" of a dealership "except as provided by however, the Butnarus could not "base those causes of Section 5.0 I B." TEX.REV.CIV. STAT. mt. 4413(36). action on [Code] violations." 18 S.W.3d at 768. § 5.02(b)(8).

As discussed above, we disagree that section 3.01 Additionally, the Code provides a dealer a remedy 's former version granted the Board exclusive if the manufacturer "unreasonably" denies a dealer's jurisdiction. But we conclude that section 3.0l(a) 's application to transfer its franchise ownership. The current version, which applies here, grants the Board Code's definition of"dealer" includes licensed dealers exclusive jurisdiction over issues and claims the Code but not prospective transferees. See TEX.REV.CIV. governs. Thus, we must determine if the Butnarus' STAT. art. 4413(36), § 1.03(7). The dealer may file claims fall within the Board's exclusive jurisdiction. a protest with the Board. TEX.REV.CIV. STAT. art. 4413(36), § 5.01B(d). The issue would be Because motor vehicle distribution and sales affects whether the prospective transferee is qualified, and the our State's economy and citizens' welfare, the Code's manufacturer must prove the prospective transferee's primary purpose is "to insure a sound system inadequacy. TEX.REV.CIV. STAT. mt. 4413(36), §§ of distributing and selling motor vehicles through 5.01B(d)-(e). If the Board determines the prospective licensing and regulating manufacturers ... and dealers transferee is qualified, the Board shall enter an order of those vehicles." See TEX.REV.CIV. STAT. art. reflecting this, and the manufacturer must accept 4413(36), § 1.02. To accomplish this, the Code strictly the transfer. TEX.REV.CIV. STAT. art. 4413(36), § regulates conduct by or between franchise dealers 5.01B(e). and manufacturers. See TEX.REV.CIV. STAT. art. 4413(36), §§ 4.01-.07, 5.01-.05. For example, *207 [10[ Jllj Here, the court of appeals' analysis the Code establishes how a dealer must request presumes that the Butnarus' trial court claims simply a transfer, assignment, or sale of its franchise seek monetary damages based on their allegation that agreement. TEX.REV.CIV. STAT. mt. 4413(36), § Ford's exercising its right of first refusal and denying 5.01B. Under that process, the Code also determines the dealership transfer violated section 5.01B. But the circumstances under which a manufacturer may the Butnarus' trial com1 claims involve something withhold its consent to the dealer's request. See different. The Butnarus seek relief for Ford's alleged TEX.REV.CIV. STAT. art. 4413(36), § 5.01B(c). tortious interference, and this claim, in turn, raises a Code construction issue. To establish their tortious Specifically, to transfer a dealership the dealer must interference claim, the Butnarus must show: (1) a file a written application with the manufacturer contract exists between Graf, Graf Ford, Barton and to transfer the dealership. The application must the Butnarus; (2) Ford willfully and intentionally identity the prospective transferee and any pertinent interfered with that contract; (3) the interference agreements about the proposed transfer. See proximately caused the Butnarus damage; and (4) TEX.REV.CJV. STAT. art. 4413(36 ). § 5.0 I B(a)( I)- the Butnarus suffered actual damage or loss. See (4). The manufacturer must timely advise the dealer Texas Beef Cattle Co. v. Green. 921 S.W.2d 203. in writing if the prospective transferee is qualified 210 (Tex.l996); Hoiimvczv v. Skinner. 898 S.W.2d or if the transferee is not acceptable. TEX.REV.CIV. 793, 795-96 (Tex.l995). But Ford may defeat liability STAT. art. 4413(36), § 5.01B(b). The Code prohibits by proving the affirmative defense that its conduct a manufacturer from "unreasonably'' withholding was privileged or justified-so long as that conduct its consent to a dealer's transfer application if the was not illegal or tortious. See Prudential Ins. prospective transferee is "of good moral character" and Co. (?l Am. v. Financial Review Servs., Inc .. 29 otherwise meets the manufacturer's predetermined, S.W.3d 74, 80 (Tex. 2000); ACS investors, inc. v. written standards, if any, about a transferee's McLaughlin 943 S.W.2d 426, 431 (Tex.l997); Texas business experience and financial qualifications. Bee/ Cattle, 921 S. W.2d at 210. It is the Butnarus' TEX.REV.CIV, STAT. art. 4413(36), § 5.01B(c). position that Ford does not have a justification Fm1her, the Code makes it unlawful for a manufacturer defense, because rights of first refusal contravene Butnaru v. Ford Motor Co., 84 S.W.3d 198 (2002) 45-rex sup~ci J 9T6 certain Code provisions and, accordingly, are void inability to award monetary damages-demonstrate and unenforceable. See TEX.REV.CIV. STAT. m1. the contrary. Thus, this case is analogous to Cash 4413(36), § 5.01B(c) (prohibiting a manufacturer America, in which we held that the plaintiff did from unreasonably denying a dealership transfer); not have to exhaust administrative remedies under TEX.REV.CIV. STAT. art. 4413(36), § 1.04 (making the Pawnshop Act because "nothing in the statutory an agreement to waive the Code's terms void and scheme indicate[ d] that the Legislature intended to unenforceable). The Butnarus also request that the trial replace a pledgor's common-law remedies with the court enter a declaratory judgment that rights of first like-kind replacement remedy" available under the refusal violate the Code. statute. Cash Am., 35 S. W.3d at 18. Similarly, because the Code does not indicate the Legislature's intent to We conclude that the Butnarus' tortious interference replace the prospective transferees' remedies here, the and declaratory judgment claims fall outside the Butnarus do not have to exhaust any administrative purview of the Board's exclusive jurisdiction. In David remedies before suing Ford for tortious interference or Mc:DaPid N;.~·swl, we held that the Board's exclusive declaratory relief. jurisdiction under section 3.0l(a) required the dealer in that case to exhaust its administrative remedies 1121 But our inqui1y does not end here. Though to obtain a final Board finding to support its Code- the Legislature did not confer exclusive jurisdiction based DTPA, bad faith, and oral contract claims. David on the Board to resolve the Butnarus' claims, we i\IcDavid Nissan, 84 S.\V.3d at 226. In concluding still must decide whether the Board has primary that the Board's exclusive jurisdiction applied to the jurisdiction to resolve the Code construction issue that dealer's Code-based DTPA and bad-faith claims, we those claims raise. See, e.g, Cash Am.. 35 S.W.3d explained that the Code provides a hybrid claims- at 18 (recognizing that, though an agency does not resolution process by which a dealer or manufacturer have exclusive jurisdiction, the policies underlying the may seek damages for certain Code violations. David primary jurisdiction doctrine may require the agency 1\lcDavid Nissan, 84 S.\V.3d at 226 (discussing to initially decide an issue). In David klcDavid Nis:..-an.

TEX.REV.CIV. STAT. m1. 4413(36), §§ 6.06(a), (e)). we explained that the primary jurisdiction doctrine Based on this process, we held that the dealer had requires trial courts to allow an administrative agency to exhaust its administrative remedies under the Code to initially decide an issue when: (1) an agency is to obtain supporting Board findings before a trial typically staffed with experts trained in handling the court could finally adjudicate the dealer's damages complex problems in the agency's purview; and (2) request for its Code-based claims. See David klcDavid great benefit is derived from an agency's uniformly Nissan. 84 S.\V.3d at 227. Additionally, in requiring interpreting its laws, rules, and regulations, whereas the dealer to obtain a Board finding before pursuing com1s and juries may reach different results under its oral contract cla.ims, we relied on a Code provision similar fact situations. David 1HcDavid Nissan, 84 mandating that a dealer obtain the Board's approval S.W.3d at 221 (citing United States v. JVestern l'oc. and a license before operating a franchise in a certain R.R. Co .. 352 U.S. 59, 64, 77 S.Ct. 161, I L.Ed.2d area. See David AfcDavid Nissan. 84 S.W.3d at 227 126 (1956); Cash Am., 35 S.W.3d at 18; /0(Jree v. (discussing TEX.REV.CIV. STAT. art. 4413(36). §§ Cro11•n Cent. Pefroleum Corp., 431 S.W .2d 312, 316 4.02(c). 4.06(a)-(e)). (Tex. 1968); Gregg v. De/hi-Taylor Oil Corp .. 162 Tex. 26. 344 S. W .2d 41 I, 413 ( 1961 ); Kavanaugh Here, however, no Code provision extends the Board's v. Undet'll'riters L{/e Ins. Co., 131 S.W.1d 753, exclusive jurisdiction to resolving the Butnarus' 755 (Tex.Civ.App.-Waco 1950. writ refd); Travis, tortious interference and declaratory judgment claims Comment, Primwy Jurisdicfion: A General The01y so that they must exhaust any administrative remedies and Its Application to the Securities Exchange Act, before seeking judicial relief. In fact, the Code's failing 63 CAL. L.REV. 926, 927 ( 1975)). We noted that, to establish any procedure through which the Board when the primary jurisdiction doctrine requires a may resolve a prospective transferee's claim that a trial court to defer to an agency to make an initial manufacturer unlawfully refused to *208 accept a determination, the court should abate the lawsuit and dealer's transfer request-coupled with the Board's suspend finally adjudicating the claim until the agency Butnaru v. Ford Motor Co., 84 S.W.3d 198 (2002) 4HeX:SU-p~cTJ91s~----·~----

has an opportunity to act on the matter. David AkDavid 1131 The Butnarus contend that if the Board has Nissan, 84 S.W.3d at 221 (citing Central Power & exclusive jurisdiction over all Code issues and claims, Ught Co. l'. Public Uti/. Comm'n, 17 S. W.3d 780, 787 this violates our Constitution's open courts provision. (Tex.App.-Austin 2000. pet. denied); Roberls Express. TEX. CON ST. arl. I, § 13. This provision prohibits Inc. v. /~\pert Trunsp., Inc., 842 S.\:V.2d 766. 771 the Legislature from abrogating well-established, (Tex.App.-Dallas 1992, no writ)). common-law claims unless the reason for doing so outweighs a litigant's constitutional right of redress.

We conclude that the primary jurisdiction doctrine See Texas Ass'n of Bus.. 852 S.W.2d at 448. applies in this case. The Butnarus' tortious interference and declaratory judgment claims raise a Code Jl4J But we have already concluded that the Board's construction issue that is within the Board's special exclusive jurisdiction does not extend to the claims competence and expertise. See Cash Am., 35 S.WJd in this case. Accordingly, the Code does not abrogate at 18. As discussed above, the Legislature has any previously existing common-law rights here. The specifically authorized the Board to resolve disputes trial coutt has immediate jurisdiction to adjudicate between a manufacturer and dealer when the dealer the Butnaru's common-law claims for breach of the alleges that the manufacturer violated section 5.0 I B purchase and sale agreements. And, after deferring by unreasonably withholding consent to transfer a to the Board so it has an opportunity to decide dealership. See TEX.REV.CIV. STAT. art. 44\3(36), the Code construction issue, the trial court may § 5.0 I B(d). The Board's expe11ise in construing finally adjudicate the tortious interference and related section 5.0 I B in these disputes, and the State's declaratory judgment claim. interest in a uniform interpretation of the Code, requires the trial comi to abate the lawsuit and suspend finally adjudicating the tortious interference D. TEMPORARY INJUNCTION and declarato1y judgment claims until the Board has a reasonable opportunity to *209 act on the The trial court temporarily enjoined Ford or its matter. See David McDal'id Nissan. 84 S.W.Jd at assignees from exercising its right of first refusal ~28: Central Power & Light. 17 S. W .3d at 787; during the suit. The court of appeals dissolved the Roberts t~:Ypress, 842 S.\V .2d at 771. Accordingly, temporary injunction, agreeing with Ford's contention the trial cou1i should abate the claims pending the that the Butnarus did not establish an inadequate legal Board having an opportunity to exercise its primary remedy. 18 S. W.3d at 769. In so concluding, the court jurisdiction to determine, at least in the first instance, of appeals noted that generally a court will not enforce whether a right of first refusal violates the Code. In contracts by injunction because a suit for damages sum, we hold that section 3.0 I (a) confers exclusive is deemed to be an adequate remedy. 18 S.\V.3d at jurisdiction on the Board but only over issues and 769. The Butnarus respond twofold. First, they argue claims the Code governs. Here, the Code does not that they were not required to show an inadequate govern the Butnarus'-as prospective transferees- legal remedy because an alleged statutory violation tortious interference and declaratory judgment claims. relieves a movant of that burden. See Furr v. Hall, Consequently, the Butnarus do not have to exhaust any 553 S.W.2d 666, 672 (Tex.Civ.App.-Amarillo 1977, administrative remedies before raising these claims in writ refd n.r.e.). They assert that courts have a duty to the trial court. However, because these claims raise enjoin statutory violations. See Priest v. Texas Aninwl a Code construction issue, the primary jurisdiction Heallh Comm'n, 780 S.W.2d 874, 876 (Tex.App.- doctrine requires the trial court to abate the claims Dallas 1989, no writ). Second, the Butnarus argue pending the Board having a reasonable opportunity to that they have otherwise established the temporary- determine whether a right of first refusal violates the injunction elements. On the inadequate legal remedy Code. element, they argue that Ford's exercising its right of first refusal would deprive them of the opportunity to purchase two unique assets: real property and the C. OPEN COURTS CHALLENGE dealership located on the property. See, e.g., Home S'av. of Am. v. Van Cleave /)ev. Co .. 737 S.W.2d 58, Butnaru v. Ford Motor Co., 84 S.W.3d 198 (2002)

59 (Tex.App.-San Antonio 1987. no writ) (noting that purchase the real property and dealership would be lost "each and every piece of real estate is unique" and that if Ford exercised its right of first refusal, and, therefore, "is ce1iainly an element to be considered in deciding injunctive relief was necessary to preserve the status whether there [will be] irreparable damages"). quo.

At the temporary injunction hearing, the Butnarus presented the following evidence: (1) their agreement *2IO I. Statutory Violation with Grafand Ba11on to purchase the real property, (2) j15J The Butnarus' misplace their reliance on FwT their agreement with Graf and Graf Ford to purchase See Furr. 553 S.\V.2d at 672. Furr does not generally the dealership, (3) Graf Ford's agreement with Ford propose that an alleged statutory violation relieves containing the right of first refusal that allegedly the plaintiffs burden to show an inadequate legal violates the Code, (4) the Code provisions that remedy. Rather, the party seeking injunctive relief in allegedly prohibit Ford's right of first refusal provision, Furr relied on a specific statute giving the right to and (5) the Butnarus' dealership application to Ford an injunction, and the court of appeals concluded that detailing their business experience and financial the statutory right relieved the party from proving an qualifications. Additionally, Hanan Butnaru testified inadequate legal remedy. Furr. 553 S.W.2d at672. The about his agreements with Graf, GrafFord, and Barton court relied on Republic Insurance Co. v. O'Donnell to purchase dealership and the real prope11y in Del Rio.

Afotor Co., which explains: He stated that in planning to establish "a dealership, he was only looking within a I 00 mile radius of San The general rule at equity is Antonio, which includes Del Rio. He also explained, that before injunctive relief can and the agreements entered in evidence showed, that be obtained, it must appear the Butnarus agreed to pay $1.2 million for the real that there does not exist an prope11y and only $500,000 for the dealership. adequate remedy at law. This limitation, however, has no Based on the Butnarus' allegations and this evidence, application where the right the trial court granted the temporary injunction. The to relief is predicated on a trial court stated in the order that the Butnarus would statutory ground other than on be irreparably harmed if Ford exercises its right of the general principles of equity. first refusal "in that the issues and rights sought to be adjudicated will become moot and [the Butnarus] will 289 S.W. 1064. 1066 (Tex.Civ.App.-Dallas 1926. no have lost the opportunity to purchase the Dealership vvrit). and the Real Prope11y."

Here, the Butnarus rely on general equitable principles, The com1 of appeals, however, dissolved the not a statutory injunctive-relief right, to enjoin Ford's temporary injunction after concluding that the conduct. Thus, Furr does not apply. And the Butnarus Butnarus did not establish an inadequate legal remedy: had to establish in the trial court, in addition to the other temporary-injunction elements, an inadequate The Butnarus are not interested legal remedy. in the real property for its own resources or aesthetics.

Their interest in the property results solely from the fact that 2. Temporary Injunction Elements the dealership is located on [I 6[ In the trial court, the Butnarus alleged that Ford's it. Thus, their true complaint exercising its right of first refusal would tortiously relates to their inability to interfere with the Butnarus' contract to purchase purchase the dealership. The the real property and the contract to purchase the uniqueness *211 of the real dealership. They further contended that their right to property is therefore itTelevant

Next to the adequacy of their legal not arbitrary and unreasonable and was not made remedy. without reference to guiding rules and principles. And, because the trial court's determination was not an abuse I 8 S.W.3d at 769. The court of appeals' holding is of discretion, the court of appeals should not have predicated upon its assumptions that the real property substituted its judgment for that of the trial court. is neither unique nor pertinent to this dispute and Beaumont Bank, 806 S.\V.2d at 226. that the Butnarus are only interested in purchasing the dealership. Ford contends that the court of appeals could have also detennined that the Butnarus did not establish a [17[ [18[ [19[ [20[ We agree with the cour\>robable right to recovery. We disagree. The trial court of appeals that, generally, a com1 will not enforce could reasonably conclude, based on the Butnarus' contractual rights by injunction, because a party can allegations and the evidence previously discussed, that rarely establish an irreparable injury and an inadequate the Butnarus had a probable right to recovery. See Sun legal remedy when damages for breach of contract are Oil. 424 s. W.:?.d at 218 (stating that the temporary available. Can/een Corp .. 773 S. \V.2d at 40 I; Chevron injunction applicant is not required to establish that it U.S.A .. Inc v. Stoker, 666 S.W.2d 379,382 (Tex.App.- will prevail on final trial and need only plead a cause of Eastland 1984. writ clism'd). But under an abuse action and show a probable right to the relief sought). of discretion standard, the cow1 of appeals cannot Because this conclusion was not "so arbitrary as to overrule the trial court's decision unless the trial com1 exceed the bounds of reasonable discretion," CRC·" acted unreasonably or in an arbitrary manner, without Evans Pipeline tnt'!. Inc. v. Afyers, 927 S.W.2d 259, reference to guiding rules or principles. Beaumont 262 (Tex.App.-Houston [I st Dist.] I 996. no writ), the Bank v. Buller, 806 S. W.2d 123, 126 (Tex. I 99 I); trial court did not abuse its discretion in finding a Davis, 571 S.W.2d at 861-62. Moreover, the cou11 probable right to recovery. of appeals cannot substitute its judgment for the trial comes reasonable judgment even if it would have Accordingly, we conclude that there is evidence to reached a contrary conclusion. f.Va/ker v. Packer, 827 support the trial court's decision to issue the temporary S.W.2d 833,839-40 (Tex.J992); Beaumont Bank 806 injunction. See Davis. 571 S.W.2d at 862. Thus, the S.W.2d at 226. The trial court does not abuse its *212 trial court did not abuse its discretion, and discretion if some evidence reasonably supports the we reverse the court of appeals' order dissolving the trial cou11's decision. Davis, 571 S. W .2d at 862. temporary injunction. [211 The evidence shows this is a case involving two contracts: a contract to purchase land and a contract to purchase a business. There is some evidence that IV. CONCLUSION the Butnarus desired valuable land located at this Section 3.0 I(a) grants the Board exclusive jurisdiction specific Del Rio location. Thus, the evidence before but only over the issues and claims the Code the trial court supports its conclusion that this dispute governs. Because the Code does not govern, or is about the right to purchase real property wmih expressly authorize the Board to resolve, the Butnarus' at least $1.2 million and not just the dealership tortious interference and declaratory judgment claims, itself. See /lome SaF.. 737 S.W.2d at 59 (upholding these prospective transferees need not exhaust any tempormy injunction in dispute involving land worth administrative remedies before the trial court has $1.5 million). And a trial court may grant equitable jurisdiction over these claims. However, under the relief when a dispute involves real prope1ty. See primary jurisdiction doctrine, the trial court should llenne/1 v. Copeland, 149 Tex. 474. 235 S.W.2d abate these claims to the extent that may be necessary 605. 609 (I 95 I); 10.1. DuPont de Nemours & Co. F. to allow the Board a reasonable opportunity to resolve Za/e Corp., 462 S.W.2d 355, 359-60 (Tex.Civ.App.- the Code construction issue they raise. Finally, the Dallas 1970, writ refd n.r.e. ); llumellv. Mitchell, I58 trial court did not abuse its discretion in granting S.W. 800, 801-02 (Tex.Civ.App.-Fort Worth 1913, the temporary injunction. Thus, we reverse the court writ re-rd). Thus, the trial comt's conclusion that the of appeals' judgment and remand the cause to the Butnarus do not have an adequate legal remedy was trial court for further proceedings consistent with this Parallel Citations opinion on rehearing. 45 Tex. Sup. Ct. J. 916

Footnotes Unless otherwise indicated, ';the Code" refers to the Texas Motor Vehicle Commission Code, and "the Board" refers to the Motor Vehicle Board. See TEX.REV.CIV. STAT. nrt. 4413(36).

Tab 6 City of Houston v. Harrison, 778 S.W.2d 916 (1989)

was filed and in holding attorneys in contempt for their failure to do so, despite 778 S.W.2d 916 attorneys' contentions that answers Court of Appeals of Texas, would divulge privileged attorney~client Houston (14th Dist.). communications and privileged attorney CITY OF HOUSTON, Diana Kay Ball, work product. and Robert John Collins, Relators, Cases that cite this headnote v. Hon. Ken HARRISON, Judge, 165th Judicial District Harris County, Respondent.

Attorneys and Law Firms No. B14-89-00821-CV. Nov. 2, 1989. *917 Diana K. Ball, Robert J. Collins, Houston, City and city attorneys filed motion for leave to file Russell H. McMains, Corpus Christi, Byron Lee, petition for writ of mandamus requesting court to order Houston, for relators. county COUit judge to vacate his orders holding city attorneys in contempt for refusing to answer certain Paul Spradlin, W. James Krenzer, Houston, for deposition questions. The Court of Appeals held that respondent. judge did not abuse his discretion in ordering attorneys to answer certain questions and in holding them in Before MURPHY, ROBERTSON and SEARS, JJ. contempt for their failure to do so. Motion overruled. OPINION PER CURIAM.

West Headnotes (2) On September I, 1989, relators filed a motion for leave to file petition for writ of mandamus requesting this Court to order respondent to vacate his orders signed Ill Mandamus August 28, 1989. ___;. Remedy at Law Mandamus issues only to correct clear The orders of August 28, 1989, held both Diana abuse of discretion or violation of duty Kay Ball and Robert John Collins in contempt of imposed by law when there is no other court for failing to answer questions propounded to adequate remedy by law. them during a deposition. The order further commands Ball and Collins to answer the objectionable Cases that cite this headnote questions. Respondent suspended the sentence pending mandamus review. Diana Kay Ball and Robert Contempt John Collins refused to answer the questions on ..-:-, Disobedience to Mandate. Order, or the grounds their answers would divulge privileged Judgment attomey~client communications of the City and Where city's bill of review made several privileged attomey work product. Collins additionally specific and serious allegations against invoked the party communications privilege. worker's compensation benefits claimant, trial court did not abuse its discretion Jay Howard Hill sought worker's compensation in ordering city attorneys to answer benefits from the City and damages for the City's certain deposition questions propounded alleged breach of the duty of good faith and fair dealing to discover what reasonable inquiry in handling his claim. Respondent rendered a total and attorneys had made before bill of review permanent incapacity judgment for Hill. The breach of good faith and fair dealing was severed from the ~it~.o~ Houston v. Harrison, 778 S.W.2d 916 (1989)

*918 TEX.R.CIV.P. 13 provides: The signatures of worker's compensation claim and tried separately in a attorneys or pmties constitute a certificate by them that bench trial. On September 7, 1988, respondent signed they have read the pleading, motion, or other paper; the judgment awarding damages to Hill. The City was that to the best of their knowledge, information, and unaware of the judgment until May 1989, when Hill belief formed after reasonable inquby the instrument made a demand for payment. is not groundless and brought in bad faith or groundless and brought for the purpose of harassment. Sanctions The City filed a bill of review on June 19, 1989. In its petition the City made several specific are available for the violation of this rule. and serious allegations that "Hill, acting by and through Hill's attorney of record, Mr. James !II [2[ It is clear that the questions propounded sought to discover what reasonable inquiry had been R. Spradlin, fraudulently, wrongfully, knowingly, made before the bill of review was filed. Mandamus and intentionally, or accidentally and mistakenly" issues only to correct a clear abuse of discretion or committed several wrongful acts. On August 1, 1989, the violation of a duty imposed by law when there is Hill subpoenaed Ball, an attorney for the City, to no other adequate remedy by law . .Johnson v. Fourth testify by deposition. On August 2, 1989, Hill filed a Court ofAppeais. 700 S.W.2d 916 (Tex.l985 ). A trial motion for sanctions under TEX.R.CIV.P. 13. At the court abuses its discretion when it reaches a decision so deposition, Hill sought to discover what inquiries Ball arbitrary and unreasonable as to amount to a clear and made into the bill of review allegations before signing prejudicial error of law. Jd. A relator who attacks the and filing the petition. Ball refused to answer these ruling of a trial court as an abuse of discretion labors questions contending the information is privileged. under a heavy burden. !d. The relator must establish, Respondent ordered her to answer the questions and under the circumstances of the case, that the facts and found her in contempt of court for failing to answer. law permit the trial court to make but one decision. !d.

This the relators have failed to do. We find respondent Hill noticed the deposition of Collins. At the did not abuse its discretion in ordering Ball and Collins deposition, Collins refused to answer questions, to answer certain questions and in holding Ball and similar to the ones asked of Ball, claiming the Collins in contempt for their failure to do so. information is privileged. Respondent ordered Collins to answer the questions and found him in contempt of Accordingly, we overrule relators' motion for leave to cou1t for refusing to answer. file petition for writ of mandamus.

Tab 7 In re Continental Airlines, Inc., 305 S.W.3d 849 (201 0) --·----- Cases that cite this headnote 305 S.W.3d 849 Court of Appeals of Texas, Houston (14th Dist.). 121 Appeal and Error '--- Abuse of discretion In re CONTINENTAL A trial comt abuses its discretion if AIRLINES, INC., Relator. it reaches a decision so arbitrary and unreasonable as to constitute a clear and No. 14-09-00952-CV. Feb. 4, 2010. prejudicial error of Jaw, or if it clearly fails to correctly analyze or apply the Jaw.

Synopsis Background: After plaintiffs in negligence suit Cases that cite this headnote involving airline crash noticed deposition of airline's chief executive officer (CEO), airline moved to quash the deposition, and plaintiffs moved to compel it. The 131 Mandamus II th District Court, Harris County, Mike Miller, J., .-""' Proceedings in civil actions in granted motion to compel. Airline field petition for general writ of mandamus. Mandamus is an appropriate remedy when a trial court allows an apex deposition to go forward in violation of the standard governing such discovery.

Holdings: The Cow1 of Appeals, Charles W. Seymore, J., held that: Cases that cite this headnote [1] plaintiffs failed to arguably show that the CEO had any unique or superior knowledge of discoverable 141 Pretrial Procedure ~;o;. Corporate officers, agents. and information, and employees [2] plaintiffs failed to show that less intrusive methods If the party seeking the apex deposition of discovery were inadequate to obtain information of a high-level corporate official cannot they were seeking. show that the official has any unique or superior personal knowledge of discoverable information, the trial cou1t Writ conditionally granted. should not allow the deposition to go forward without a showing, after a good faith effort to obtain the discovery through less intrusive means, ( 1) that there is a West Headnotes (8) reasonable indication that the official's deposition is calculated to lead to the Ill Mandamus discovery of admissible evidence, and ___ Remedy by Appeal or Writ of Error (2) that the less intrusive methods of Mandamus discovery are unsatisfactory, insufficient ~-··" !\.'tatters of discretion or inadequate.

To be entitled to extraordinary relief in a I Cases that cite this headnote writ of mandamus, the relator must show the trial court clearly abused its discretion and there is no adequate remedy by 151 Pretrial Procedure appeal. -"'"' Corporate officers. agents, and employees In re Continental Airlines, Inc., 305 S.W.3d 849 (2010)

Plaintiffs in negligence suit arising from airline accident failed to arguably show I Cases that cite this headnote that, following airline 1s chief executive officer's (CEO) public statements, he had 181 Pretrinl Procedure any unique or superior knowledge of ~-= Corporate officers. agents, and discoverable information, as required to employees support motion to compel his deposition; Plaintiffs in negligence suit arising from CEO stated that information he gave at airline accident failed to show that press conference was provided to him less intrusive methods of discovery by other airline employees, that he did were inadequate to obtain information not discuss with "deadheading'' pilots they were seeking regarding negligence, what occurred before, during, and after proximate cause, or damages, as accident, and that he had not received required to support motion to compel information about cause of accident in deposition of airline's chief executive executive briefs. officer (CEO); although plaintiffs I Cases that cite this headnote had deposed some crew members, they had not noticed depositions of airline's corporate representative, other 161 Prctrinl Procedure individuals present in meetings where Corporate ofticers, agents. and CEO received information about accident, employees other employees who were more directly The testimony that a corporate executive involved in supporting ongoing National possesses knowledge of company policies Transportation Safety Board (NTSB) does not, without more, satisfy arguable investigation, or those described by CEO showing that executive has unique in his affidavit as having responsibility in or superior knowledge of discoverable particular areas of inquiry. infmmation, as required to support motion to compel deposition of such official. 2 Cases that cite this headnote I Cases that cite this headnote

Pretrinl Procedure Attorneys and Law Firms ,= Corporate officers, agents. and *850 George Lucas Ashley, John H. Martin, Dallas, employees TX, Juan Carlos Garcia. Sr., Morgan Lindsey Gaskin, Requirement that patty seeking Houston, TX, for Relator. deposition of a corporate president or other high level corporate official Jason A. Gibson, Houston, TX, for Real Party in must first attempt to obtain discovery Interest. through Jess obtrusive means is not perfunctorily met by any showing that the Panel consists of Chief Justice !·lEDGES and Justices party employed le~s-intrusive discovery SEYMORE and SULLIVAN. methods, but by whether discovering party made a reasonable effmt to obtain discovery through less-intrusive methods; OPINION merely completing some less-intrusive CHARLES W. SEYMORE, Justice. discovery does not trigger an automatic right to depose the apex official. November 12,2009, relator, Continental Airlines, Inc., filed a petition for writ of *851 mandamus in this

~Je:-:t In re Continental Airlines, Inc., 305 S.W.3d 849 (2010)

Court. See Tex. Gov't Code Ann.* 22.221 (Vernon deadheading pilots aboard Flight 1404 and personally 2004); see also Tex.R.App. P. 52. In the petition, awarded commendation plaques to crew and flight relator asks this Comt to compel the Honorable Mike members; and (5) Kellner, who serves on the Board Miller, presiding judge of the II th District Cowt of of Directors for Air Transport Association of America Harris County, ·to set aside his October 26, 2009 ("ATA"), an airline industry organization dedicated to order compelling the deposition of Larry Kellner, ensuring the safety of airline passengers, has superior Chief Executive Officer and Chairman of the Board of knowledge as to Continental's implementation of Directors of Continental. We conditionally grant the ATA's policies. On October 19, 2009, Continental petition. filed a motion for protective order and response to the motion to compel, with Kellner's affidavit in which he testified that he has no unique or superior knowledge.

BACKGROUND On October 26, 2009, the trial cowt held a hearing On December 20, 2008, Continental Flight 1404 was on the plaintiffs motion to compel and Continental's involved in an accident when it departed from the motion for protection.· The trial court granted the runway during takeoff from the Denver International motion to compel Kellner's deposition, and orally Airport. There were no fatalities, but 37 passengers and stated that the deposition was limited to two hours and crew were transported to the hospital. to actions and statements by Kellner relating to the crash of Flight 1404. On October 26, 2009, the trial Larry Kellner, Continental's Chief Executive Officer court signed the order granting the motion to compel, and Chairman of the Board of Directors, gave denying the motion for protective order, and granting a statement and answered questions at a press the motion to quash. *852 However, the trial cou1t conference following the accident. On December 22, did not mention the above limitation on the deposition 2008, Kellner sent a letter to the passengers expressing in its order. 2 his concern for the accident. The plaintiffs brought suit against Continental for negligence. 1 MANDAMUS STANDARD OF REVIEW On October 6, 2009, the plaintiffs noticed the deposition of Kellner for November 5, 2009. On Ill [21 131 To be entitled to extraordinary relief October 9, 2009, Continental filed a motion to quash in a writ of mandamus, the relator must show the the deposition, arguing that Kellner has no unique trial court clearly abused its discretion and there is no or superior knowledge of discoverable information adequate remedy by appeal. !nre Team Rocket. 1".1'., and the plaintiffs have not attempted to obtain 256 S.W.3d 257,259 (Tex. 2008) (orig. proceeding). A discovery through less intrusive methods. See Crown trial court abuses its discretion if it reaches a decision Cent. Petroleum Corp. v. Garcia. 904 S.W.:2d so arbitrary and unreasonable as to constitute a clear (Tex.l995) (orig. proceeding). Continental also and prejudicial error of law, or if it clearly fails to objected to the time and place set forth in the notice correctly analyze or apply the law. In re C:erherus because Kellner had prior commitments requiring him Capital ,\.~gmt .. L.l'., 164 S.W.3d 379,382 (Tex. 2005) to be out of town on that date. (orig. proceeding) (per curiam); JYa/ker v. Packer, 827 S.W.2d 833, 839 (Tex.l992) (orig. proceeding).

On October 9, 2009, the plaintiffs moved to compel Mandamus is an appropriate remedy when a trial court Kellner's deposition, arguing that he has unique or allows an apex deposition to go forward in violation superior knowledge of discoverable information as of the standard governing such discovery. E.g., In re shown by the following: (I) Kellner immediately Pmd,. X. :lm., Inc., No. 01-06-00613-CV, 2006 WL briefed media members on details of the crash; (2) :219:2546, at *:2-3 (Tex.App.-Houston [1st Dist.] Aug.

Kellner stated, on numerous occasions, he would learn 4, 2006. orig. proceeding) (mem. op.). the cause of the crash to prevent future crashes; (3) Kellner sent personal letters to Flight 1404 passengers after the crash; (4) Kellner interviewed the In re Continental Airlines, Inc., 305 S.W.3d 849 (2010)

discove1y and the comt has sufficient information to consider both prongs of the guidelines. !d.

CROWN CENTRAL GUIDELINES The standard governing apex depositions originates in Crown Central Petroleum Corporation, 904 S.W.ld ANALYSIS at 128. The Crown Cenlra/ guidelines apply "[w]hen a party seeks to depose a corporate president or other high level corporate official and that official Unique or Superior Knowledge (or corporation) files a motion for protective order to Continental asse1ts that it met its burden for invoking prohibit the deposition accompanied by the official's the apex procedure set f01th in Crown Central. In his affidavit denying any knowledge of facts .... " ld affidavit, Kellner testified, in relevant part: A party initiates the CroH'n Cenfral guidelines by moving for protection and filing the corporate official's ... While I have knowledge affidavit denying any knowledge of relevant facts. In of some facts relating to reA!ca/el li.SA. Inc .. II S.W.3d 173, 175 (Tex. 2000) the accident by reason of (orig. proceeding). my position as CEO, I do not possess any unique or 151 "The trial court evaluates the motion first superior personal knowledge by deciding if the pmty seeking the deposition has beyond that of other senior 'arguably shown that the official has any unique or management personnel at superior knowledge of discoverable information.' " Jd Continental who are involved at 175-76 (quoting Crown Cent. Pe/ro/ewn Corp .. 904 in the day-to-day management S.W.2d at 128)." 'If the party seeking the deposition of the airline's operations cannot show that the official has any unique or superior generally and who were knowledge of discoverable information, the trial court involved in the response should' not allow the deposition to go forward without activities as a result of the a showing, after a good faith effort to obtain the accident specifically. discovery through less intrusive means, '(I) that there is a reasonable indication that the official's deposition The plaintiffs claim they seek to depose Kellner is calculated to lead to the discovery of admissible because he has first-hand knowledge of relevant facts evidence, and (2) that the Jess intrusive methods such as information about the events leading up of discovery *853 are unsatisfactory, insufficient to and during the crash of Flight 1404, and how 6r inadequate.' " ld at 176 (quoting Croll'n Cenl. Continental planned to handle passengers' claims and Petroleum Corp., 904 S.W.2d at 128). prevent similar crashes in the future. Continental argues that it is not sufficient to show that Kellner In In re Alcalel U5>1, the Texas Supreme Court has unique or superior knowledge of some facts or recognized that these guidelines could be read as matters concerning the subject matter, but of facts requiring trial courts to unde1take two hearings or matters relevant to the contested fact issues of and issue two orders. !d. "We recognize that these the litigation, i.e., whether Continental's negligence, guidelines could be read as requiring trial courts to if any, proximately caused the accident, and what unde1take two hearings and issue two orders: First, a injuries and damages, if any, each plaintiff sustained. hearing on whether to grant a protective order and, if one is granted, then a second hearing, after less The plaintiffs contend that Kellner began his hands- intrusive methods of discovery have been explored, on involvement when he held a press conference just to determine whether the protective order should be hours after the crash at which he stated that Continental dissolved." !d. Therefore, a "mechanical" application "will do whatever we can to learn the cause of of the Crown Central guidelines is not necessary this accident so that we can prevent a recurrence at when the pmties have already undertaken extensive Continental or at any other airline."

'I In re Continental Airlines, Inc., 305 S.W.3d 849 (2010)

At the press conference, Kellner generally stated In his affidavit, Kellner stated that the information he that Continental "will do everything we can for provided at the press conference was not unique or the passengers, their families, and our coworkers." superior individual knowledge because it was given Kellner further recited the basic facts of the accident, to him by other individuals at Continental. Moreover, that a number of injuries had been reported, Continental argues that none of Kellner's public and passengers and crew had been transported to statements made after the accident have anything to area hospitals. Kellner also stated that Continental do with whether the flight crew acted negligently, or was mobilizing its "Accident Go Team," which whether the passengers actually sustained any injuries is comprised of Continental experts-people from in the accident. safety, air traffic control, engineering, maintenance, and flight operations-to assist in the investigation. The plaintiffs further assert that the December 22, 2008 Kellner concluded his statement by saying: "We will letter sent after the crash to each passenger reiterates continue to do eve1ything we can for the passengers, Kellner's involvement. The December 22, 2008 Jetter crew, and their families. We will also do whatever we states: can to learn the cause of this accident so that we can prevent a reoccurrence at Continental.. .. " Let me begin by expressing my deep personal concern for the distressing experience you had as In response to questions at the press conference, a passenger aboard our flight 1404 on December Kellner stated: 20, 2008. We regret that you had to go through this experience and are working diligently with the • "We'll work with each of the passengers individually National Transportation Safety Board to determine to do what's best for them. Obviously this has been a the cause of the accident and to help make sure very difficult evening for them, even if they weren't that something like this never again occurs at injured and didn't go to the hospital, and so we'll Continental or any other airline. address that on a passenger-by-passenger basis."

I would like to personally thank you for your quick *854 • "I know at this time, Jive given you all the facts response during the evacuation of the aircraft and I know. As I mentioned, we'll have our Go Team apologize for what you had to go through. The safety going up there later this morning. A few hours, of our passengers and crew is our highest priority. they'll leave here. We'll work with the NTSB and there'll be a full and thorough investigation." On behalf of my co-workers at Continental, please allow me to express once again my deepest regret "Again, all we know is that it was taking offi.] for your experience on board flight 1404.

It was about 6:00 p.m. Mountain Standard Time and that it veered off the runway, slides were The plaintiffs contend that the information Kellner deployed, but we're not really ... Again, we'll do a states he intends to uncover while working with the full investigation. NTSB will do a full-will lead a NTSB is discoverable because it pertains directly to the full investigation. We'll assist with that; and as those basis oftheir claims. In this affidavit, however, Kellner facts come out, we'll give them to you." stated that he has no unique or personal knowledge of the investigation into the cause of the accident. • "I don't want to go into too much of it and what Kellner explained that the NTSB, not Continental, is was in the weather there. There's nothing specific conducting the official investigation into the cause of that's come up on the weather as far as snow or the accident, and Continental continues to cooperate those type [sic] of items. But I really want to Jet the with the NTSB investigation. investigation more [sic] forward to figure out what happened as far as the cause of the accident. But Federal Jaw provides that the NTSB, not Continental, there's nothing specific I'd comment on the weather is to conduct the investigation of the accident, and at this moment." will determine the cause or probable cause of the accident. 3 Continental, as a pmty designated *855 by the NTSB to participate in the investigation, is In re Continental Airlines, Inc., 305 S.W.3d 849 (2010)

prohibited from conducting its own inVestigation into the cause of the accident during the pendency of *** the NTSB investigation. 4 Here, Continental is not Q. (BY MR. GJBSON)-when something like this conducting the investigation to determine the probable happens? cause of the accident.

A. 1-I'm sure it is.

Moreover, Kellner stated that Toby Can-oil is Continental's representative relative to the NTSB Q. And what does an executive summary consist of? investigation. The plaintiffs have not stated whether they have taken Carroll's deposition or, if so, that they *** were unable to elicit the information they are seeking.

Therefore, Kellner has shown that he does not have A. Well, in my opinion, it would be just the- the facts as we know them and the circumstances unique or superior knowledge relative to the cause of surrounding the-the incident, accident, whatever the accident. the situation was.

The plaintiffs further argue that the information *856 Q. (BY MR. GIBSON) Do you know who's and facts Kellner has learned about the cause of responsible for preparing that brief? the accident in executive briefs provide him with unique and superior knowledge. They assert that A.No. the deposition testimony of Continental's chief pilot shows that based on Continental's standard operating Q. Have you reviewed the executive brief in this procedure, Kellner received executive briefs about case that was given to Mr. Kellner? "'what's going on and what's happening in this case."

Andrew Jost testified: *** Q. Do you know anybody that's talked to Mr. A. 1-I have-! can't even say that it exits. I'm just Kellner personally about this crash? thinking it does, so ....

A.No. In his affidavit, Kellner states, in the days immediately following the accident, that he received briefing about Q. Not that it hasn't happened; you just don't know the accident, "primarily related to the status and about it? effectiveness of the passenger and family assistance efforts in Denver and Houston, the general health A. Correct. and well-being of the passengers and crew, and Q. Would Mr. Kellner-based on the policies and Continental's media response to the accident." 5 procedures that you know that are in place internally Therefore, he did not acquire any unique or superior at Continental Airlines, Mr. Kellner would have knowledge about the cause of the accident as a result a pretty good idea of what's going on and what's of post-accident briefings. A review of lost's testimony happened in this case, don't you think? shows that he has never reviewed an executive brief and that he does not know what information an *** executive brief contains. Therefore, Jest's testimony does not contradict Kellner's statement that no unique A. Well, I'm sure Mr. Kellner has received a or superior personal knowledge has been acquired executive brief or----or some briefing in some through these briefings. fashion.

Q. (BY MR. GIBSON) It is standard operating The plaintiffs further claim that Kellner continued procedure of Continental for-for Mr. Kellner or to take an active role in learning the details of the CEO of-of the airline to receive an--executive what caused the accident when he interviewed the summary- deadheading pilots on·Fiight 1404, Richard Lowe and

---~ --~~--~ .. --~---·----·~---··-·---

Ne~:t d;;;::Y· tt. i!C: i:Di U .~~ In re Continental Airlines, Inc., 305 S.W.3d 849 (2010)

Richard Green. 6 According to the plaintiffs, when Are you okay? Wow, great job. What do you need?

Lowe and Green arrived back in Houston, Kellner What can we do for you? met with them to discuss what occurred before, Q. Not what happened. during, and after the crash. Kellner also awarded recognition plaques to the crew and pilot members, A. 1-1 really don't recall that.... And 1-1 think which evidences Kellner's "hands on" involvement. more than anything there was a concern for-for our wellbeing and-and more along the lines of, hey, Todd Green testified regarding the identity of those we'll figure out what happened later. What can we do who attended the meeting, but did not recite what was for you? And so that's-that's what I seem to recall. said at the meeting: Green's and Lowe's testimony refute the plaintiffs' A. And there was a-a brief-] should say a short claim that Kellner interviewed them to discuss what debrief that was agreed upon there at the airport. occurred before, during, and after the accident.

Moreover, consistent with Lowe's testimony, Kellner *** stated, in his affidavit, that he spoke briefly with Q. Lefs talk about that meeting when you got back each crew member and the deadheading pilots after to Houston. When was that? the accident, "but the purpose of these conversations was to express my concern for their health and well- being .... I did not seek to uncover any details about *** activities in the cockpit or what may have caused the Q. And Mr. Kelleher [sic]? accident, and none were provided."

A. He was there briefly. He was there-met the Lowe's testimony confinns the plaintiffs' claim that flight, and he did come in and-and talk to us once recognition plaques were awarded to the crew and pilot or twice. He talked to everyone on the airplane members. Lowe received "a recognition-type plaque initially. that was-that was given to me at the CEO exchange as well as the other crew members, pilot members But I did meet with him. There may have been that were there." It is difficult to see how awarding some other people, also. I don't remember the ALPA recognitions plaques to the crew and member pilots representatives that were there. There weren't any is evidence of hands-on involvement in determining ALPA lawyers, but there-an-an ALPA from our the cause of the crash or that Kellner has unique or superior personal knowledge of the events surrounding Q. Pilots. the accident.

A. union. Pilots, yes. The plaintiffs further argue that Kellner, as a board- member for the Air Transpoti Association of America And Richard and I, Kelly, those two gentlemen- ("ATA"), has superior and unique knowledge as to oil, Kip Commodore, one of our assistant chiefs- Continental's implementation of operational and safety chief pilots, and I believe that was all in the room practices. The plaintiffs rely on the following ATA when were based-when we were talking. mission statement: *857 Richard Lowe testified about what occurred at ATA serves its member the meeting: airlines and their customers by assisting the airline Q. In this meeting, were they asking all of you what industry in continuing to happened? provide the world's safest system of transpOiiation; A. It-it wasn't geared towards that. It was more of, transmitting technical expe1iise you know, how are you doing? How are you feeling? and operational knowledge to

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In re Continental Airlines, Inc., 305 S.W.3d 849 (201 0)

improve safety, service and inquiry is what effect, if any, the statement has on efficiency ... a particular passenger, not what Kellner subjectively intended by the utterance.

The plaintiffs contend that Kellner has unique and superior knowledge of how Continental works with 161 In addition, the testimony that a corporate the AT A to provide the "world's safest" system executive possesses knowledge of company policies of transportation and how Continental implements does not, without more, satisfy the first Crmm technical expetiise and operational knowledge to Central test because such evidence does not show that ensure the safety of its passengers. the executive has unique or superior knowledge of discoverable information. In re .•1/cate/ USA, inc., II In his affidavit, Kellner states that his position "on S.W.3d at 177; see also AMR C01p. v. Enlow, 926 the Board does not give me any 'superior or unique S.W.2d 640. 641 (Tex.App.-Fort Worth 1996. orig. knowledge as to Continental's imJ?lernentation of proceeding) (holding testimony that AMR's president, operational and safety practices' as alleged by the CEO, and chairman of board would have ultimate plaintiffs." Kellner further explained that Captain Don authority over any policy because he had "about all Gunther has direct responsibility for implementation the authority he needs on most issues in business" of operational and safety practices at Continental amounted to "nothing more than the simple, obvious and also serves as Continental's representative on the recognition that the highest-ranking corporate officer AT A's safety committee. The plaintiffs have not stated of any corporation has the ultimate responsibility for whether they have deposed Gunther or that he has all corporate decisions and falls farshort of the [Croll'n not or will not be able to provide the information Central] standard"). 7 they seek. Kellner has demonstrated that he does not have unique or superior knowledge regarding of Here, Kellner has shown that he does not have Continental's implementation of operational and safety unique or superior knowledge regarding what occurred practices. before and during the accident or the cause of the accident. Kellner stated that the information he gave The plaintiffs also rely on Kellner's statement about at the press conference was provided to him by other individual passengers and how Continental will handle Continental employees; he provided the name of the each case on a passenger-by-passenger basis: Continental employee who is its pmiy representative to the NTSB investigation; he did not discuss with We'll work with each of the the deadheading pilots what occurred before, during, passengers individually to do and after the accident; he has not received information what's best for them. Obviously about the cause of the accident in the executive this has been a very difficult briefs; and he named the Continental employee who *858 evening for them, even has direct responsibility for the implementation of if they weren't injured or didn't operational and safety practices at Continental and go to the hospital, and so we'll serves as Continental's representative on the ATA address that on a passenger-by- safety committee. See In re Daisy .Hamtfhcturing passenger basis. Company, 17 S.W.3d 654. 659 (Tex. 2000) (orig. proceeding) (per curiam) (explaining that even ifDaisy In support of their mental anguish claims, the plaintiffs Manufacturing's CEO were deposed, he had little first- contend it is vital to know what Kellner meant by hand information about areas of inquiry). this statement, pmiicularly in consideration of those passengers who suffer from mental anguish, but did not sustain serious physical injuries. They argue that Less Intrusive Methods Kellner is the only person who knows what he meant by that statement, which imbues him with unique 171 The plaintiffs argue, even if they failed to show knowledge regarding how Continental will handle that Kellner has unique or superior knowledge, that the claims of each passenger. However, the relevant there are no less intrusive methods or other discovery

Ne:-:t In re Continental Airlines, Inc., 305 S.W.3d 849 (2010)

has been insufficient to gain information regarding See id ("Merely completing some less-intrusive discovery does not trigger an automatic right to depose what Kellner meant by his public statements or what the apex official."). Here, the plaintiffs have not shown he has learned about the cause of the accident. that less intrusive methods are inadequate to obtain the The requesting partis burden is not perfunctorily met by any showing that the pmty employed less- information they are seeking. intrusive discovery methods.ld at658. Crmvn Central With regard to the plaintiffs' assertion that there is Petro!l!um Corporation instructs the courts to measure no one other than Kellner who could testify as to whether the discovering party made a reasonable effort what he meant by his various public statements, to obtain discovery through less-intrusive methods.

Continental concedes that Kellner is best able to ld "Merely completing some *859 less-intrusive address his own subjective intent in making his discove1y does not trigger an automatic right to depose the apex official." Jd. generalized public statements following the accident.

However, Kellner's subjective intent in making the subject public statements does not establish anything The plaintiffs assert that, in trying to find regarding negligence, proximate cause, or damages. evidence about the cause of the accident and Kellner's The plaintiffs have not shown a reasonable indication statements, they have conducted the following that deposing Kellner would lead to the discovery of discove1y: (1) 110 requests for production; (2) 74 admissible evidence. interrogatories; and (3) 11 depositions of pilots, crew and management of personnel of Continental, totaling over 50 hours of deposition testimony.

CONCLUSION Continental asserts that while the plaintiffs have deposed some crew members and other field The trial court abused its discretion by compelling personnel, they have not noticed the depositions the apex deposition of Larry Kellner. Accordingly, we of Continental's corporate representative, other conditionally grant Continental's petition and direct individuals present in any meetings where Kellner the trial cmut to set aside its October 26, 2009 order received information about the accident, other compelling Kellner's deposition. The writ will issue employees who are more directly involved in only if the trial court fails to act in accordance with this supporting the ongoing NTSB investigation, or those opinion. employees described by Kellner in his affidavit as having responsibility in the particular areas of inquiry.

Footnotes On March 12, 2009, Continental moved for transfer and consolidation or all pending and future cases pursuant to Texas Rule of Judicial Administration 13. On May 7, 2009, the Multidistrict Litigation Pane[ granted Continental's motion, and designated the I I th District Court of Harris County as the Pretrial Court. The underlying proceeding is styled In re Continental Airlines Flight /404, MDL No. 2009-33036. There are 29 plaintiffs in 14 cases consolidated into the MDL proceeding.

2 The order states verbatim: On the 26th day of October 2009, the Court considered Plaintiffs' Motion to Compel the Deposition of Larry Kellner, Continental Airlines, Inc.'s Motion for Protective Order, and Continental Airline, Inc.'s Motion to Quash the Deposition of Larry Kellner. All parties appeared by and through their representative counsel. The Com1, after considering the pleadings, the motions, the sworn affidavit of Larry Kellner, and the arguments by counsel, finds as follows: IT IS ORDERED that Plaintiffs' Motion to Compel the Deposition of Larry Kellner is GRANTED, Defendant Continental Airlines, Inc.'s Motion for Protective Order is DENIED, and Defendant Continental Airlines, Inc.'s Motion to Quash is GRANTED.

The Court acknowledges that Continental Airlines, Inc. may seek appellate review of this order by way of mandamus. In the event that Continental Airlines, Inc. files a petition for writ of mandamus on or before November I 6, 2009[,] then this Court's order granting Plaintiffs' Motion to Compel the deposition of Larry Kellner simi! be

~Jext In re Continental Airlines, Inc., 305 S.W.3d 849 (2010)

stayed until the final disposition of all mandamus proceedings related to this order. In the event no petition for mandamus is tiled on or before November 16, 2009, then the deposition of Larry Kellner shall occur by December 30, 2009.

3 Federal law provides that the NTSB investigates the accident: (a) Gencral.-(1) The National Transportation Safety Board shall investigate or have investigated (in detail the Board prescribes) and establish the facts, circumstances, and cause or probable cause of- (A) an aircraft accident the Board has authority to investigate under section I 132 ofthis title or an aircraft accident involving a public aircraft as defined by section 40102(a)(37) of this title other than an aircraft operated by the Armed Forces or by an intelligence agency of the United States; ...

49 U.S.C.A. ~ 1131 (a)( I )(A} (West 2007).

4 Federal regulations provide: (a) All investigations, regardless of mode. (1) The investigator-in-charge designates parties to participate in the investigation. Parties shall be limited to those persons, government agencies, companies, and associations whose employees, functions, activities, or products were involved in the accident or incident and who can provide suitable qualified technical personnel actively to assist in the investigation. Other than the FAA in aviation cases, no other entity is afforded the right to participate in Board investigations. (b) Participants in the investigation (i.e., party representatives, party coordinators, and/or the larger party organization) shall be responsive to the direction of Board representatives and may lose party status if they do not comply with their assigned duties and activity proscriptions or instructions, or if they conduct themselves in a manner prejudicial to the investigation.

49 C.c.R. ~ S31. t I (a), (b).

5 Kellner further stated, in his affidavit, that he continued to receive periodic ·'privileged'' briefings from Continental's General Counsel, Vice President of Safety and other senior management and legal personnel about the accident, status of the NTSB investigation. and the status of passenger claims and litigation.

6 .;Deadheading" refers to those crew members who are travelling on an aircraft free of charge but not working because they are located in the wrong place and need to travel to take up their duties.

7 At the hearing on the plaintiffs' motion to compel, the trial court opined that ;'it is reasonable to be able to ask the person in charge of the enterprise ultimate questions about responsibility and safety issues and so forth. That doesn't seem to have been what the Supreme Court has done in these cases." This statement indicates that the trial court acknowledged controlling authority.

rights. Vernon's Ann.Texas Rules Civ.Proc .. Rules 166b. subds. 1. 2, par. a, KcyCitc Yellow Flag~ Negative Treatment 5, 200.

Declined to Follow by State ex rd. Ford Motor Co. v. Messina, Mo., April9, 2002 :2 Cases that cite this headnote 904 S.W.2d 125 Supreme Court of Texas. 121 Pretrial Procedure > Protective Orders Before CROWN CENTRAL PETROLEUM Examination CORPORATION and Crown Central "Apex depositions," i.e., depositions of Pipe Line Company, Relators, persons in upper level management v. of corporations often involved in The Honorable Carolyn lawsuits, present problems which GARCIA, Judge, Respondent. should reasonably be accommodated in discovery process. Vernon's Ann.Texas No. 9S-0174· Argued March 23, Rules Civ.Proc., Rules 166b, subds. 1, :2, 1995. I Decided June 29, 1995. 5, 200.

I Rehearing Overruled Aug. 1, 1995.

I Cases that cite this headnote Estate of deceased employee sued corporations for negligence, in connection with death of employee Pretrhd Procedure allegedly caused by asbestos exposure. Plaintiff '"= Protective Orders Before noticed deposition of CEO and chairman of the Examination board of corporations, and trial court ordered CEO to attend deposition. Corporations petitioned for writ When party seeks to depose corporate of mandamus to Supreme Co mi. The Supreme Comi, president or other high level corporate Hightower, J., held that writ would be denied without official, and that official, or the prejudice to allow trial cou1i to reconsider its order corporation, files motion for protective denying corporations' motion to quash deposition in order to prohibit deposition accompanied light of new guidelines. by officer's affidavit denying any knowledge of relevant facts, trial court Writ denied without prejudice. should first determine whether patty seeking deposition has arguably shown Gammage, J., dissented. that official has any unique or superior personal knowledge of discoverable information; if showing is not made, the trial court should grant motion West Headnotes (5) for protective order and first require party seeking deposition to attempt to Ill Pretrial Procedut·e obtain discove1y through less obtrusive __, Protective Orders Before measures, such as the depositions of Examination lower level emp~Oyees, deposition of corporation itself, and interrogatories and While Rules of Civil Procedure permit requests for production of documents a parly to take the deposition of "any directed to corporation. Vernon's person," person noticed for deposition Ann.Texas Rules Civ.Proc., Rules \66b. also has the right to protection from subds. 1, 2, par. a, 5, 200. undue burden, unnecessary expense, harassment or annoyance, or invasion 40 Cases that cite this headnote of personal, constitutional, or property Crown Cent. Petroleum Corp. v. Garcia, 904 S.W.2d 125 (1995)

141 Pretrial Procedure HIGHTOWER, Justice, delivered the opinion of ....,, Protective Orders BefOre the Court, in which PHILLIPS, Chief Justice, Examination and GONZALEZ, HECHT, CORNYN, ENOCH, After making good faith effort to obtain SPECTOR and OWEN, Justices, join. discovery through less intrusive methods, Opinion pa1iy seeking to take apex deposition of corporate president or other high level corporate official may attempt to show GAMMAGE, Justice, notes his dissent. that there is reasonable indication that In this original proceeding, we consider the propriety official's deposition is calculated to lead of an "apex" deposition, the deposition of a corporate to the discovery of admissible evidence, officer at the apex of the corporate hierarchy. Relators and that less intrusive methods of Crown Central Petroleum Corporation and Crown discove1y are unsatisfactory, insufficient, Central Pipe Line Company seek a writ of mandamus or inadequate; if party seeking deposition directing the trial court to vacate its orders of makes this showing, trial court should Januaty 18 and 25, 1995 concerning the deposition of modify or vacate protective order as Henry Rosenberg, Jr., the chairman of the board and appropriate. Vernon's Ann.Texas Rules chief executive officer of Crown Central Petroleum Civ.Proc., Rules 166b, subds. I, 2. 5, 200. Corporation (Crown Central). Today this court adopts guidelines for depositions of persons at the apex of the Cases that cite this headnote corporate hierarchy. 1 Because these guidelines had not been adopted prior to the trial court's orders, we Pretrial Procedure deny the writ of mandamus without prejudice so that ~·-·" Protective Orders Before the trial court may reconsider its ruling in light of Examination today's opinion. 2 Pretrial Procedure Time and place of, and procedure •• " ' Otto L. Carl, Jr. was employed by Crown Central at its for, taking Pasadena refinery for many years. Carl retired in 1981.

Pretrinl Procedure In 1992, Carl died oflung cancer allegedly as the result .·' ' Limiting scope of examination of asbestos exposure. In late 1992, Margaret Carl, individually and as representative of the estate of Otto As with any deponent, trial court retains L. Carl, Jr., deceased, Otto L. Carl, Ill and Margaret discretion to restrict duration, scope, E. Nowak (Plaintiffs) sued Crown Central and Crown and location of apex deposition of Central Pipe Line Company for gross negligence. corporate president or other high level In July 1994, Plaintiffs filed a motion to require corporate officials. Vernon's Ann.Texas Crown Central to produce Rosenberg for a video Rules Civ.Proc., Rules 166b, subds. I. 2. deposition. The motion also included a subpoena duces 5, 200. tecum for Rosenberg to produce sixteen categories of Cases that cite this headnote documents. Crown Central responded with a motion to quash deposition accompanied by Rosenberg's affidavit. Among other things, the affidavit stated: "I have no personal knowledge of Mr. Carl or his Attorneys and Law Firms job duties, job performance, or any facts concerning alleged exposure to asbestos by Mr. Carl. I was *126 Jack G. Carnegie, James L. fvloore and M. not involved in the day-to-day maintenance decisions Michael Meyer, Houston, for relators. made at the Refinery. I have no expertise in industrial hygiene, toxicology, or the health effects of asbestos t John E. Williams, Jr., Eric Bogdan, John E. Williams, exposure." 3 Crown Central complained that Plaintiffs Jr. and Richard N. Countiss, Houston, for respondent. had not exhausted less intrusive means of discovery

~Jext Crown Cent. Petroleum Corp. v. Garcia, 904 S.W.2d 125 (1995)

before attempting to depose Rosenberg and that the any documents requested in the subpoena duces tecum motion to produce Rosenberg for a video deposition until after they are afforded a reasonable opportunity to was filed solely for *127 harassment purposes. have their objections to the production considered by Concerning the subpoena duces tecum, Crown Central the court. On January 25, 1995, the trial court denied asserted that Rosenberg was not the custodian of the the emergency motion for reconsideration. requested documents and that a substantially identical request was made by the Plaintiffs in a request for production to which Crown Central had responded I. and filed objections. Neither motion was heard or acted upon. In mid-December 1994, Plaintiffs filed Crown Central argues that the trial court abused its a notice of intention to take the oral deposition discretion when it granted Plaintiffs' motion to produce of Rosenberg. The notice also included a subpoena Rosenberg for video deposition and denied Crown duces tecum for Rosenberg to produce thirty-two Central's motion to quash. categories of documents. Crown Central responded with a motion to quash deposition and motion for Ill It is undisputed that a "party is entitled to protective order. Crown Central continued to complain discovel)' that is relevant to the subject matter of the about Rosenberg's lack of personal knowledge, the claim, and which appears reasonably calculated to lead harassment of Rosenberg and the subpoena duces to the discovery of admissible evidence." Afonsanto tecum for Rosenberg to produce thirty-two categories Co. v. May, 889 S.W.2d 274,276 (Tex.!994)'(0pinion of documents. In late December 1994, Plaintiffs filed on denial of leave to file petition forwritofmandamus) their first amended notice of intention to take the (Gonzalez, J., joined by Hecht, J., dissenting) (citing oral deposition of Rosenberg which reset the date for Tex.R.Civ.P. I 6Gb( I), (2)(a)). Rule 200 of the Texas Rosenberg's deposition. The notice also included the Rules of Civil Procedure permits a party to take same subpoena duces tecum concerning production the deposition of "any person." However, the person of thirty-two categories of documents. Crown Central noticed for deposition also has the right to protection again responded with a motion to quash deposition "from undue burden, unnecessmy expense, harassment and motion for protective order. Crown Central or annoyance, or invasion of personal, constitutional, continued to complain about Rosenberg's lack of or property rights." Tex.R.Civ.P. I 66b(5); Monsan/o personal knowledge, the harassment of Rosenberg and Co. v. Mc(v. 889 S. W.2d at 276. the subpoena duces tecum for Rosenberg to produce thirty-two categories of documents. Although not previously addressed by this cou11, the propriety of "apex" depositions-depositions of a On January 18, 1995, after a telephone hearing, the trial corporate officer at the apex of the corporate hierarchy court granted Plaintiffs' motion to produce Rosenberg -has been addressed by other courts. See Uberty for video deposition and denied Crown Central's Afutual fns. Co. v. Superior Court of San Afateo motion to quash. The trial court ordered Crown Counly. 10 Cai.App.4th 1282, 13 Cai.Rplr.2d 363 Central to produce Rosenberg for deposition and that ( 1992); Broadband Communications Inc. v. !-lome Rosenberg produce all documents requested in the Box O.ffice, Inc .. 157 A.D.2d 479, 549 N.Y.S.2d subpoena duces tecum. 4 On January 20, 1995, Crown 402 ( 1990); Saller v. UJJjolm Co., 593 F.2d 649 Central filed an emergency motion for reconsideration (5th Cir.l979); Baine v. General Afotors Corp., requesting that the trial court quash the deposition, 141 F.R.D. 332 (M.D.Aia. 1991 ); *128 'fi·ovelers compel the Plaintiffs to serve Rosenberg with written Renlal Co .. Inc. v. Ford Mo/or Co .. 116 F.R.D. 140 interrogatories concerning the extent of his knowledge (D.Mass. 1987); Mulvey v. Chi)'Sier Ccup .. I06 F.R.D. concerning this action which would be answered 364 (D.R.I.I985 ); 1\Iiu·hel/ v. :f merican Tobacco Co .. within five days, limit the duration of Rosenberg's 33 F.R.D. 262 (M.D.Pa. 1963); Armstrong Cork Co. deposition to one hour, reconsider its ruling concerning v. Niagara Mohawk Power Corp., \6 F.R.D. 389 the production of documents in the subpoena duces (S.D.N. Y.l954); M.A. Poraozi Co. v. The Mormac/ark, tecum, and amend its prior order so that neither Crown 16 F.R.D. 383 (S.D.N.Y.!95! ).

Central nor Rosenberg would be required to produce

Next ) Crown Cent. Petroleum Corp. v. Garcia, 904 S.W.2d 125 (1995)

Liberty Mutua/Ins. Co. v. Superior Court qjSan Ala/eo the protective order and allow County is particularly instructive. In Libert}/ kfulual the deposition to proceed. fns. Co., the court held: Cal.Rptr.2d at 367 (citation omitted). that when a plaintiff seeks to depose a corporate president or other official at the II. highest level of corporate management, and that official 121 As virtually every court which has addressed moves for a protective order the subject has observed, depositions of persons in to prohibit the deposition, the upper level management of corporations often the trial court should first involved in lawsuits present problems which should determine whether the plaintiff reasonably be accommodated in the discovery process. has shown good cause that From the decisions of these other courts, we distill the the official has unique or following guidelines for addressing the problems. superior personal knowledge of discoverable information. If 131 141 151 When a party seeks to depose a not, as will presumably often corporate president or other high level corporate be the case in the instance of official and that official (or the corporation) files a a large national or international motion for protective order to prohibit the deposition corporation, the trial court accompanied by the official's affidavit denying any should issue the protective knowledge of relevant facts, the trial court should first order and first require determine whether the party seeking the deposition the plaintiff to obtain the has arguably shown that the official has any unique necessary discovery through or superior personal knowledge of discoverable less-intrusive methods. These information. If the party seeking the deposition cannot would include interrogatories show that the official has any unique or superior directed to the high-level personal knowledge of discoverable information, the official to explore the state trial court should grant the motion for protective order of his or her knowledge and first require the party seeking the deposition to or involvement in plaintiffs attempt to obtain the discovery through less intrusive case; the deposition of methods. Depending upon the circumstances of the lower-level employees with particular case, these methods could include the appropriate knowledge and depositions of lower level employees, the deposition involvement in the subject of the corporation itself, and interrogatories and matter of the litigation; and requests for production of documents directed to the the organizational deposition of corporation. After making a good faith effort to obtain the corporation itself, which the discovery through less intrusive methods, the party will require the corporation to seeking the deposition may attempt to show (I) that produce for deposition the most there is a reasonable indication that the official's qualified officer or employee deposition is calculated to lead to the discovery of to testify on its behalf as admissible evidence, and (2) that the Jess intrusive the specified matters to be methods of discovery are unsatisfactory, insufficient raised at the deposition. Should or inadequate. If the party seeking the deposition these avenues be exhausted, and' makes this showing, the trial court should modify or the plaintiff make a colorable vacate the protective order as appropriate. As with any showing of good cause that deponent, the trial court retains discretion to restrict the the high-level official possesses duration, scope and location of the deposition. If the necessa1y information to the party seeking the deposition fails to make this showing, case, the trial court may then lift

T' Crown Cent. Petroleum Corp. v. Garcia, 904 S.W.2d 125 (1995)

its order denying Crown Central's motion to quash the trial court should leave the protective order in place.

Rosenberg's deposition. The stay order previously issued by this co uti remains * 129 in effect only so long as necessary to allow the trial court to act.

Because these guidelines had not been adopted prior to the trial court's orders, we deny the writ of mandamus without prejudice so that the trial court may reconsider

Footnotes· This court has sought to address the propriety of"apcx" depositions on several previous occasions, but the cases were mooted by settlement or withdrawal of the notice· of deposition. See State Farm Mutual A wo ins. Co. l'. !1o11. JenJ' A. Dl!l!ana. No. D-34g9. 36 Tcx.Sup.Ct.J. 661 (March 24, 1993) (plaintiff withdrew the deposition notice before argument, and the petition was dismissed as moot); Cessna Aircraft Co. v. Hon. Eugene Chambers, No. 94-0079, 37 Tex.Sup.Ct.J. 759 (May II, 1994) (settlement by the parties). But see ,Honstmto Co. 1'. lion Robert .Hay, 889 S.W.2d 274 (Tex.l994) (motion for leave to file petition for writ of mandamus overruled).

2 See Phoeni.r Founders. Inc. v. Marshall. 887 S.W.2d 831 (Tex.l994); National Tank Co. 1'. Hrothaton, 851 S.W.2d I93 {Tcx.l993).

3 Rosenberg's complete anidavit stated: My name is Henry A. Rosenberg, Jr. I am over the age of 18 years, of sound mind, have never been convicted of a felony, and am fully competent to make this affidavit.

I have personal knowledge of the facts stated herein and they are true and correct.

I am Chairman of the Board and Chief Executive Officer of Crown Central Petroleum Corporation (''Crown Central"). Crown Central employs approximately three thousand employees; therefore, I do not have personal knowledge of each employee's job duties or performance.

I was a member of the American Petroleum Institute in 1987, which I understand was several years after Otto Carl retired from Crown Central. The letter to Mr. Carl dated June 24, 1980, a copy of which was attached to the Plaintiffs' Motion to Produce lvfr. Henry Rosenberg, Jr. for Video Deposition, was a form letter sent to all employees who worked during a work stoppage which occurred at Crown Central's Pasadena refinery (the ''Refinery''). I have no personal knowledge ofMr. Carl or his job duties, job performance, or any facts concerning alleged exposure to asbestos by Mr. Carl.

I was not involved in the dayMtoMday maintenance decisions made at the Refinery. I have no expertise in industrial hygiene, toxicology, or the health effects of asbestos exposure.

4 Apparently, the trial court did not consider Crown Central's objections to production of the documents described in the subpoena duces tecum.

Next Tab 9 Simon v. Bridewell, 950 S.W.2d 439 (1997)

:= Scope of inquiry and powers of com1 With respect to disputed factual issues, KeyCite Yellow Flag~ Negative Treatment court ruling on mandamus petition may Distinguished by In rc Miscavigc, Tcx.App.-Austin, July 17, 20\4 not substitute its judgment for trial court's.

950 S.W.2d 439 Cases that cite this headnote Court of Appeals of Texas, Waco.

131 Mandamus ~-~ Matters of discretion Melvin SIMON and Herbert Simon, Relators, v. Relators in mandamus proceeding must establish that trial court could reasonably Honorable Wayne BRIDEWELL, have reached only one decision.

Judge, 249tb Judicial District Court, Johnson County, Texas, Respondent. Cases that cite this headnote No. 10-97-213-CV. Aug. 6, 1997.

141 Pretrial Procedure Plaintiff sued, among others, general partners in .-· C01vorate officers. age~ts, and limited partnership that allegedly owned, managed, employees and provided security for shopping mall at which Apex deposition doctrine applies in suits fatal shooting occurred, claiming negligence, gross where party seeks to depose corporate negligence, breach of contract, and Deceptive Trade president or other high level corporate Practices Act (DTPA) violations. The 249th District official, and is invoked when corporate Court, Johnson County, Wayne Bridewell, J., denied official files motion for protection partners1 motion for protective order from notices of accompanied by affidavit denying any deposition served by plaintiff. After granting partners' knowledge of relevant facts. motion for leave to file petition for mandamus relief, the Court of Appeals held that pa11ners were not I Cases that cite this headnote entitled to protective order under apex deposition doctrine on ground that they were cochairs of board of lSI Pretrial Procedure directors of corporation that was not party to suit. -p'· rvtotions for protective orders and proceedings thereon Petition denied.

Once apex deposition doctrine is invoked by corporate official, burden of persuasion shifts to party seeking West Headnotes (10) deposition to show that official possesses some pe1iinent personal knowledge of relevant facts; if party seeking discovery Ill Mandamus does not make this showing, com1 <""' Presumptions and burden of proof should grant motion for protection and Relator in mandamus proceeding bears first require party seeking deposition to burden of showing it has no adequate attempt to obtain discovery through less remedy by appeal and that com1 abused its intrusive methods. discretion in taking action of which relator complains. 1 Cases that cite this headnote Cases that cite this headnote 161 Pretrial Procedure 121 Mandamus Simon v. Bridewell, 950 S.W.2d 439 (1997)

~'""" Corporate officers, agents, and employees 1 Cases that cite this headnote Cochairs of board of directors of corporation were not entitled to protective 191 Pretrinl Procedure order under apex deposition doctrine in >" Corporate officers. agents, and civil case arising out of fatal shooting employees at shopping mall which partnership, in Apex official cannot find safe harbor which cochairs were general partners, in apex deposition doctrine when record allegedly owned and managed and for shows that party seeking deposition has which partnership allegedly provided previously attempted less intrusive means security; positions with corporation had of discovery. no bearing on amenability to deposition as corporation had no ownership interest in 3 Cases that cite this headnote mall at time of shooting, plaintiff seeking discovery had already exhausted other 1101 Pretrial Procedure avenues for conducting discovery, and -~ Persons Who May Be Examined cochairs were named parties in lawsuit.

General partners of limited partnership I Cases that cite this headnote are subject to deposition in legal actions involving partnership.

171 Pretrial Procedure Cases that cite this headnote .~-. Corporate officers. agents, and employees Corporate officer is not exempt from deposition by apex doctrine merely Attorneys and Law Firms because he is corporate official; rather, doctrine may be invoked only when *440 Scott Patrick Stolley, John A. Mackintosh & deponent has been noticed for deposition Rachelle H. Glazer, Thompson & Knight, P.C., Dallas, because of his corporate position. Angus E. McSwain, Fulbright, Winniford, Bice & Marable, P.C. Waco, for Relators.

3 Cases that cite this headnote Kathryn J. Gilliam, Waco, John Holman Barr, M.

Forrest Nelson & John Howell House, Burt Barr & 181 Pretrial Procedure Associates, L.L.P., Dallas, John R. MacLean, Dan .·- Corporate officers, agents, and Boulware & Sydney Hewlett, MacLean & Boulware, employees Cleburne, for Real Parties in Interest.

If protective order under apex deposition doctrine is issued, party seeking Dennis W. Bridewell, Cleburne, pro se. deposition may, after making good faith Before DAVIS, C.J., and CUMMINGS and VANCE, effort to obtain discovery through less JJ. intrusive methods, attempt to show that there is a reasonable indication that official's deposition is calculated to lead to discove1y of admissible evidence, and that MEMORANDUM OPINION the less intrusive methods of discovery are PER CURIAM. unsatisfactory, insufficient or inadequate; if party seeking deposition makes this Relators Melvin Simon and Herbert Simon filed showing, trial court should modifY or a motion seeking leave to file a petition for writ vacate protective order as appropriate. of mandamus against Respondent, the Honorable Simon v. Bridewell, 950 S.W.2d 439 (1997) ......... .. ..............- ................................................................................................................ - .......... _ . ._ Wayne Bridewell, Judge of the 249th Judicial District Relators filed their initial objections and responses Court, Johnson County. Cynthia Joy Bacon ("Bacon"), to these discovery requests on December 1. Bacon individually, as personal representative of the Estate continued to conduct discovery for over a year. of Kevin Reuss Bacon, and as next friend of Amber She considered Relators' responses to her discovery Gayle Bacon and Robyn Nicole Bacon, minors, is the inadequate. Thus, she noticed Relators for oral real party in interest. Relators seek a writ of mandamus depositions on April 14, 1997. torequire Judge Bridewell to vacate his order of May 30, 1997, denying Relators' motion for a protective Relators filed a motion to quash their depositions on order from notices of deposition served on them by the same day, 1 alleging that *441 Bacon sought Bacon. them solely for purposes of harassment and that the infonnation Bacon sought could be obtained On July 18, we granted Relators' motion for leave "from other readily available sources who have closer to file the petition for mandamus relief. After contact and more personal knowledge of any subject having considered Relators' petition, Bacon's reply, the matters that could be relevant to this litigation." Judge exhibits, and arguments of counsel, we will deny the Bridewell set the matter for hearing on May 30. petition.

Relators filed a supplemental motion for protection on May 23, which asserts that because they are co- FACTUAL BACKGROUND chairs of the board of directors of Simon DeBm1olo Group, Inc. 2 the depositions sought by Bacon "are Bacon filed suit against Relators Melvin and Herbert necessarily 'apex' depositions .... " See Crown Cenl.

Simon and others. The factual basis of Bacon's f'elroleum Corp. v. Garcia. 904 S.W.2d 125, 128 suit stems from the fatal shooting of her husband (Tex.l995 ). Relators also argued in the motion that Kevin in the food court of the Irving Mall on the "apex" deposition doctrine applies "[b]ecause of December 27, 1993. Relators were general partners · the relative positions that they held in their respective of Irving Mall Development Company, L.P (the companies in 1993 and the comparable positions that "Irving partnership"), a Texas limited partnership. they hold today .... " They collectively owned a 73.99 percent interest in the Irving partnership. According to Relators' mandamus petition the Irving partnership owned Irving Mall until December 20, The two other general partners of the Irving 1993, seven days before the fatal shooting. Relators partnership, Irving Mall, Inc., and M.S.A. § Shopping allege that on that date they and their other pattners Malls, Inc. ("MSA"), collectively owned a 1.1 percent transferred their respective interests in the Irving interest in the partnership. Irving Mall, Inc., was a pm1nership to a newlyformed entity known as Simon wholly-owned subsidiary of MSA. M.S.A. § is a Property Group, L.P ("SPGLP"). 3 SPGLP in turn closely-held corporation with Relators each owning a transferred ownership of the mall to Simon Property fifty percent interest in the corporation.

Group (Texas), L.P., a Texas limited partnership (the "Texas partnership"). Relators allege that the Irving Bacon sued Relators and the Irving partnership for pa1tnership dissolved in December 1994 by the filing negligence, gross negligence, DTPA violations, and of a ce11ificate of cancellation of the certificate of breach of contract. The suit alleges that the Irving limited partnership with the office of the Secretary of partnership owned and managed the Irving Mall at the time of the shooting and that Relators were then State. 4 SeeTEX.REV.CIV. STAT. ANN .. art. 6132a- general partners of the Irving partnership. Bacon also l. § 1.03(a) (Vernon Supp.!997). alleges that the Irving partnership provided security for the mall at the time of the shooting. Bacon began Golden Ring Mall Company, L.P. ("Golden Ring"), pretrial discove1y by serving Relators and the Irving is the sole general pm1ner of the Texas partnership. partnership on August 29, 1995, with interrogatories, Simon Property Group (Delaware), Inc. ("SPG requests for admission, and requests for production. Delaware"), is the sole general partner of Golden Simon v. Bridewell, 950 S.W.2d 439 (1997)

Ring. Relators are co-chairmen of the board of SPG 23, 1994, the date on which Relators allege it Delaware. SPGLP is the sole limited partner of Golden dissolved. 6 It also is evidence that the pmtnership Ring. Bacon has named SPGLP, the Texas partnership, continued to provide security for the mall after the Golden Ring, and SPG Delaware as defendants in her alleged date of dissolution. Thus, Bacon produced suit. some evidence that the Irving partnership was responsible for mall security on the date of the fatal Bacon asserts that the Irving pa11nership continued to shooting. exercise ownership and management responsibilities over the mall after December 20, 1993. As evidence At the hearing on Relators' motion, the court reviewed she cites a lease amendment between the Irving the pleadings, accepted documentary evidence, and partnership and Frozen Fox, Inc. dated August4, 1994. heard argument of counsel before ruling. The court However, because Bacon did not offer this document denied Relators' request to quash the deposition in evidence at the hearing, Relators have filed a notices. motion to strike or disregard it. We may not consider evidence which the proponent did not present to the [11 121 131 The relator in a mandamus proceeding trial couJi. 5 Sabine Off.s·hore Serv., Inc. v. City of Pori bears the burden of showing it has no adequate remedy Arthur, 595 S.W.2cl 840, 841 (Tex.l979); Intercity by appeal and that the court abused its discretion Management Corp. v. Chambers. 820 S.W.2d 811, in taking the action of which the relator complains.

813 n. 4 (Tex.App.-Houston [I st Dist.] 1991, a rig. Canadian !-!e/icopters Ltd v. f.Vittig, 876 S.\V.2d proceeding). Thus, we grant Relators1 motion to strike. 304, 305 (Tex.l994 ). With respect to disputed factual issues, we may not substitute ow· judgment for the trial Bacon also contends that regardless of the ownership court's. Easter v. McDonald. 903 S.W.2d 887. 889-90 of the mall, the Irving partnership continued to provide (Tex.App.-\Vaco 1995, orig. proceeding). Relators security for the mall after December20, 1993. Relators "must establish that the trial court could reasonably claim that "(t]he responsibility for security at [the] mall have reached only one decision." fd at 890. rests with the mall manager and the director of security at the ... mall (]."They allege that after December 20, 1993, SPG Texas owned and managed the mall and THE "APEX" DEPOSITION DOCTRINE thus was responsible for mall security.

141 151 Our Supreme Court adopted the "apex" At the hearing, Bacon introduced an April 1994 deposition doctrine in 1995. Crow11 Cent. Petroleum, request by the Irving partnership to renew its security 904 S.\V.2d at 126. The doctrine applies in suits where license with the Texas Board of Private Investigators "a party seeks to depose a corporate president or other and Private Security Agencies. Bacon also introduced high level corporate official.. .. " !d. at 128. The "apex" a certificate of license issued by the Board to the doctrine is invoked when the corporate official files Irving partnership on March I, 1996. This certificate a motion for protection accompanied by an "affidavit renewed the partnership1s security *442 license denying any knowledge of relevant facts .... " !d. The through February 28, 1997. In addition, Bacon offered burden of persuasion then shifts to the party seeking a July 1993 lease signed by Relator Herbert Simon the deposition to show that the official possesses some as president of Irving Mall, Inc. with La Fata, pertinent personal knowledge of relevant facts. !d.

Inc. The lease expressly provides that the Irving If the party seeking discovery does not make this partnership "will operate, manage, [and] maintain ... showing, the court should grant the motion "and first the Common Area of the [mall]." Among other things, require the party seeking the deposition to attempt to the partnership agreed in the lease to provide "police obtain the discove1y through less intrusive methods." protection [and] security and security patrol" for the /d. common area.

161 From the record before us, we conclude that The security license constitutes some evidence that the the "apex" doctrine does not apply to this case for a Irving partnership continued to exist after December number of reasons.

Simon v. Bridewell, 950 S.W.2d 439 (1997)

evidence, and (2) that the Jess intrusive methods of discovery are unsatisfactory, insufficient THE CORPORATE OFFICIAL'S or inadequate. If the party "APEX" STATUS MUST BE seeking the deposition makes RELEVANT TO THE DEPOSITION this showing, the trial court 171 A corporate officer is not exempt from deposition should modify or vacate the by the "apex" doctrine merely because he is a corporate protective order as appropriate. official. Rather, the doctrine may be invoked only !d. when the deponent has been noticed for deposition because of his corporate position. For example, if the president of a Fortune 500 corporation personally In this case, the record suggests that Bacon attempted less intrusive means of discovery prior to witnesses a fatal car accident, he cannot avoid a seeking Relators' depositions. Judicial economy is not deposition sought in connection with a resulting served by granting a protective order where the record wrongful death action because of his "apex" status. affirmatively reflects that the party seeking discovery Thus, Relators' positions with Simon DeBartolo has already exhausted other avenues for conducting Group, Inc. have no bearing on their amenability to discovery. Thus, we conclude that an "apex" official deposition because that corporation had no ownership cannot find safe harbor in the "apex" doctrine when interest in the mall at the time of the shooting. the record shows that the party seeking the deposition has previously attempted less intrusive means of discove1y. Cf id. THE "APEX" DOCTRINE IS UNAVAILABLE IF LESS INTRUSIVE MEANS OF DISCOVERY HAVE ALREADY BEEN EMPLOYED APPLICABILITY OF THE "APEX" Bacon attempted to conduct discovery for over DOCTRINE TO PARTNERSHIPS eighteen months by means of interrogatories, requests Relators filed affidavits denying personal knowledge for production, and requests *443 for admission with their motion for protection. However, by before noticing Relators for oral depositions. Although introducing evidence of the continued existence of the Relators filed numerous objections to these discovety Irving partnership at least for security purposes, Bacon requests, they did not object to them on the basis has raised a potential fact issue with respect to what of their "apex" status, and they attempted to answer organization was truly responsible for security at the many of the discovery requests subject to their stated mall on the date of the fatal shooting. lf the Irving objections. 7 partnership was responsible for security, as Bacon's evidence suggests, then it might be liable to Bacon !81 Ordinarily, once a court grants an "apex" under one or more of the theories asserted in her suit. protective order, the patty seeking discovery can return to the cmut after attempting other avenues of discovery Relators essentially controlled over 75 percent of and seek to have the order overturned. the Irving partnership as general partners. Relators' evidence suggests that the partnership continued its After making a good faith existence for at least twelve months after the fatal effort to obtain the discovery shooting. The records of the Texas Board of Private through less intrusive methods, Investigators and Private Security Agencies reflect that the party seeking the deposition the partnership renewed its security license after the may attempt to show (1) shooting and continued to possess the license through that there is a reasonable February I 997. indication that the official's deposition is calculated to lead to the discovety of admissible Simon v. Bridewell, 950 S.W.2d 439 (1997)

II 01 As general partners, Relators are liable for the Moreover, Relators are named parties to Bacon 1s suit. obligations of the Irving partnership. TEX.REV.CIV. Rule 200 of the Rules of Civil Procedure provides STAT. ANN .. mi. 6132a-l. § 4.03 (Vernon that "any party may take the testimony of any Supp.l997); Shaw v. Kennedy. I.td.. 879 S.W.2d 240, person, including a party, by deposition upon oral (Tex.App.-Amarillo I994.no writ). The general examination." TEX.R. CIV. P. 200. Thus, because Relators are defendants in this lawsuit, Bacon may partners of that pattnership are likewise subject to deposition in legal actions involving the partnership. depose them.

See, e.g., Kelly Assoc., Ltd. v. Aetna Casualty & Sur.

Co .. 681 S.W.2d 593.595 (Tex.l984). *444 CONCLUSION Relators have cited no cases where the "apex" doctrine has been extended to general partners in a Relators have failed to show that the court abused its limited partnership. Although we do not preclude the discretion in denying their motion for protective order. possibility that the doctrine might be so extended under They have not demonstrated that "the trial court could appropriate facts, the facts presented in this case do not reasonably have reached only one decision." Easler, warrant such an extension. 903 S.W.2d at 890. Thus, we deny the petition.

THE "APEX" DOCTRINE DOES NOT PROTECT NAMED PARTIES

Footnotes Bacon had notified counsel for Relators by letter dated March 24, 1997, that she intended to depose them and sought mutually agreeable times to conduct the depositions. Relators apparently filed their motion in anticipation of Bacon's deposition notices.

2 Simon DeBartolo Group, Inc. is not a party to Bacon's suit.

3 In 1993, Relators were limited partners ofSPGLP. They exchanged their interests in SPGLP in August 1996 fOr similar interests in another limited partnership known as Simon DeBartolo Group, L.P. 4 Relators did not offer a copy of the certificate of cancellation in evidence at the hearing.

5 At the hearing on Relators' motion for protection, Bacon sought to introduce over twenty lease agreements signed by Herbert Simon as president ofirving Mall, Inc. and various tenants of the mall. These lease agreements were all apparently signed by the respective parties between 1990 and 1993. Relators stipulated that Herbert Simon signed all these leases in his capacity as president of Irving Mall, Inc. 6 The date of the filing of a certificate of cancellation does not necessarily equate to the date of dissolution of a limited partnership. According to section 2.03(b)(4) of the Texas Revfsed Limited Partnership Act, a limited partnership can designate a future effective date of dissolution in a certificate of cancellation. TEX.REV .CIV. STAT. ANN .. art. 6132a- l, § 2.03(b)(4) (Vernon Supp.\997). Because Relators have not provided a copy of the certificate of cancellation, we cannot say whether the certilicate of cancellation was effective on the date it was filed or on some future date.

7 Relators commonly objected to the propounded interrogatories on the basis that they were ·'overbroad, unduly burdensome, unnecessarily expensive and meant solely for the purpose of harassment.''

l· Tab 10 Wilz v. Flournoy, 228 S.W.3d 674 (2007) 5o-tex.sup ct~J.-97s-··-

228 S.W.3d 674 West Headnotes (6) \ Supreme Court of Texas.

Patricia WILZ, Guardian of Jon Patrick Ill Trusts Flournoy, an Incapacitated Person, Petitioner, -r· Presumptions and burden of proof v. A party seeking to impose a constructive Kenneth W. and June trust has the initial burden of tracing FLOURNOY, Respondents. funds to the specific propet1y sought to be recovered.

No. 06-0913. June 29, 2007.

7 Cases t'hat cite this headnote Synopsis Background: Former wife, as guardian for Trusts incompetent son, brought action against fanner .- Trust Property or Funds Mingled husband and his new wife, asserting claims for with Properly or Funds of Trustee conversion, breach of fiduciary duty, constructive fraud, and imposition of constructive trust, relating to Once the party seeking to impose a former husband's handling, when he had been son's constructive trust has satisfied his or her guardian, of proceeds of settlement of son's personal initiCJ.I burden of tracing funds to the injury action. At close of evidence, former husband specific prope11y sought to be recovered, and new wife moved for an instructed verdict, which the entire property will be treated as motion was denied. The 77th District Court, Limestone subject to the trust, except in so far as County, Deborah Oakes Evans, J., entered judgment the trustee may be able to distinguish and on jury's verdict against former husband and new wife, separate that which is his own. denied their motion for judgment notwithstanding the Cases that cite this headnote verdict (JNOV), and imposed a constructive trust on former husband's and new wife's entire farm. Fonner husband and new wife appealed. The Waco Court 131 Appeal and Error of Appeals, 20 I S. W.3d 833, affirmed in part and > Sufficiency of Presentation of reversed and rendered in part. Review was granted. Questions Affirmative claim of former husband and his new wife, as defendants in former wife's action, as guardian for !Holding:! The Supreme Court held that fmmer husband and new wife, by failing to obtain a incompetent son, asserting claims for jury finding on their affirmative claim, regarding conversion, breach of fiduciary duty, imposition of constructive trust, that funds for down constructive fraud, and imposition of constructive trust, relating to former payment for farm purchased by former husband and new wife came from former husband's personal funds husband's handling, when he had been rather than from settlement proceeds, waived the claim son's guardian, of proceeds of settlement of son's personal injury action, that funds on appeal. for down payment for fann purchased by former husband and new wife came from Court of Appeals reversed; judgment rendered. former husband's personal funds rather than fi·om settlement proceeds, so that entire farm was not subject to constructive trust, was waived on appeal unless former husband and new wife conclusively established the claim under the evidence, Wilz v. Flournoy, 228 S.W.3d 674 (2007) 5ofex:s·uP"tCT975······ ......... '" ......... where former husband and new wife .--- Testimony of interested persons failed to obtain a jury finding on that The factfinder may treat an interested affinnative claim. Vernon's Ann.Texas witness's testimony as conclusive if it is Rules Civ.Proe .. Rule 279. clear, direct, and positive and there are no circumstances tending to discredit or Cases that cite this headnote impeach the same. [4[ Appeal and Error Cases that cite this headnote _co;, Sufficiency of Presentation of Questions [6] \Vitnc-sses Affirmative claim of former husband .= Effect of refusal to ansvver and his new wife, as defendants in In action brought by former wife, as former wife's action, as guardian for guardian for incompetent son, against incompetent son, asserting claims for former husband and his new wife, conversion, breach of fiduciary duty, asserting claims for conversion, breach constructive fraud, and imposition of of fiduciary duty, constructive fraud, and constructive trust, relating to former imposition of constructive trust, relating husband's handling, when he had been to former husband's handling, when he son's guardian, of proceeds of settlement had been son's guardian, of proceeds of son's personal injuty action, that funds of settlement of son's personal injury for down payment for farm purchased action, jury was entitled to draw negative by former husband and new wife came inferences from former husband's and from fOrmer husband's personal funds new wife's repeated invocations of rather than from settlement proceeds, Fifth Amendment privilege against self- so that entire fam1 was not subject to incrimination when questioned at trial constructive trust, was not conclusively about truth of former husband's deposition established under the evidence, and testimony that funds for down payment thus, former husband and new wife, by for farm purchased by former husband failing to obtain a jury finding on that and new wife came from former husband's affirmative claim, waived the claim on personal funds rather than from settlement appeal; the only evidence supporting the proceeds. U.S.C.A. Const.Amend. 5; claim was former husband's deposition Rules ofEvid .. Rule 513(c). testimony, former husband was interested witness, former wife attempted to 9 Cases that cite this headnote contradict his testimony, and jury was entitled to draw negative inferences from former husband's and new wife's repeated invocations of Fifth Amendment Attorneys and Law Finns privilege against self-incrimination when questioned at trial about truth of former *675 Percy L. lsgill, C. Zan Turcotle, lsgitt & husband's deposition testimony. U.S.C.A. Associates, P.C., Houston, Edward T. i'vlcFmland, Const.Amend. 5; Vernon's Ann.Texas Lutkin, for petitioner.

Rules Civ.Proc., Rule 279; Rules ofEvid ..

John Porter Mabry, Vance Dunnam, Dunnam & Rule 513(c).

Dunnam, Waco, for respondents.

1 Cases that cite this headnote Opinion [5[ Evidence PER CURIAM.

Wilz v. Flournoy, 228 S.W.3d 674 (2007) 5o Tex~sup. ct.'J~97s·-·~--·--------------------··----

On behalf of her son, Jon Flournoy, Patricia Wilz Flournoys converted Jon's property with malice. The sought to impose a constructive trust on property trial court therefore imposed a constructive trust on the purchased by her ex-husband and his new wife. The entire farm. trial court imposed a constructive trust on the entire property, but a divided court of appeals limited the trust The com1 of appeals agreed that Wilz had met her to a 35 percent undivided interest. Given the evidence burden to impose a constructive trust on the entire presented at trial and the jury's findings, the court of fam1, and the burden shifted to the Flournoys to appeals erred in limiting the constructive trust, and we show which funds came from their own accounts. reverse. 20 I S.W.3d 833, 836-37. Nonetheless, it held that the trial court abused its discretion because Kenneth's Patricia Wilz and Kenneth Flournoy divorced in 1973, deposition testimony proved he paid the down and Kenneth was awarded custody of their son, Jon. payment from personal settlement funds and that In 1987, Jon suffered incapacitating injuries in an $50,000 was outstanding on the note. The court of automobile accident. Kenneth, individually and on appeals estimated Jon's interest in the farm as the Jon's behalf, sued Ford Motor *676 Company. In a initial purchase price minus the down payment minus 1991 settlement, Kenneth received $379,300 on Jon's the amount outstanding. Thus the court of appeals behalf and $95,000 personally. As guardian of Jon's concluded that Jon was entitled to a constructive trust person and estate, Kenneth purchased stocks and bonds on an undivided 35 percent of the farm. for Jon's benefit. Subsequently, Kenneth and his new wife, June, purchased a 110-acre farm for $I53,049, Ill 121 A party seeking to impose a constructive paying $49,365.50 in cash and executing a note for trust has the initial burden of tracing funds to the the balance. The note called for monthly payments specific property sought to be recovered. Meyers v. of $96!. Between 1991 and 1999, the Flournoys Buy/or Univ., 6 S.W.2d 393. 394-95 (Tex.Civ.App.- withdrew several thousand dollars from Jon's account, Dallas 1928, vvrit ret\1); see r:aton v. ! lusted. 141 Tex. many installments of which were roughly $960. By the 349, 172 S.W.2d 493. 498 (1943) ( "[T]he beneficiary end of200 I, the Flolll·noys had depleted Jon's account, may follow the trust property, and claim every part of and they institutionalized him in a state mental health the blended property ·which the trustee cannot identifY facility. as his own.") (emphasis in original). Once that burden is met, "the entire ... property will be treated as subject In 2005, Jon's biological mother, Patricia Wilz, became to the trust, except in so far as the trustee may be able to his guardian, and she sued the Flom·noys on Jon's distinguish and separate that which is his OlV/1." [:;a ton, behalf for conversion, breach of fiduciary duty, and 172 S.W.2d at 498-99 (emphasis in original). The trial constructive fraud. court and court of appeals agreed that Patricia traced Jon's funds to the farm; thus, the burden shifted to the Patricia traced several checks drawn on Jon's account Flournoys to demonstrate what portion of the farm's to the Flournoys' personal account. When questioned purchase price came from their own funds. See 20 1 about these checks, the handling of Jon's funds, and S.W.3d at 839. the source of the funds used to purchase the farm, the Flournoys each invoked the Fifth Amendment 131 141 [51 161 The Flournoys bet the farm (as it privilege against self-incrimination. The Flournoys' were) when they failed to obtain a jury finding on their sole evidence regarding the funds consisted of affirmative claim that pmt of the purchase money came Kenneth's pretrial deposition, where he said he used from personal funds. Therefore, this claim is waived his settlement money for the farm's down payment and on appeal unless they "conclusively established" it. that $50,000 remained outstanding on the note. When See *677 7:0. Sfonley Boor Co. v. Bank qf' 1:1 questioned about the truth of this testimony, Kenneth Paso. 847 S.W.2d 218. 222-23 (Tex.l992) (citing again invoked the Fifth Amendment. TEX.R. CIV. P. 279). The Flournoys' only evidence on this point was Kenneth's deposition testimony.

The jury found that Kenneth breached his fiduciary Kenneth, however, was an "interested witness," so duty and committed constructive fraud and that the his testimony, even if uncontradicted, "presents an Wilz v. Flournoy, 228 S.W.3d 674 (2007)

to disregard Kenneth's deposition testimony as not issue to be determined by the trier of fact." Gl!vinson credible. Therefore, the trial court did not abuse its 1'. Manhattan Conslr. Co., 449 S.W.2d 458, 467 discretion in imposing a constructive trust on the entire (Tex.l969). The factfinder may treat an interested witness's testimony as conclusive if it is "clear, direct , farm. and positive and there are no circumstances tending Accordingly, we grant Patricia Wilz's petition to discredit or impeach the same." !d. But here, Wilz for review, and without hearing oral argument, attempted to contradict Kenneth's testimony, and the TEX.R.APP. P. 59.1, reverse the court of appeals' jmy in this civil case was free to draw negative judgment and render judgment that the entire farm inferences from the Flournoys' repeated invocations is subject to a constructive trust, see TEX.R.APP. P. of the Fifth Amendment. See TEX.R. EYID. 513(c); 60.2(c).

Tex. Dep'l (!(Pub. _c;qj'ety Ojjicer.v .r'lss'n v. Denton, 897 S.W.2d 757. 760 (Tex.l995) (citing lJLLYler v. Pal111igiano. 425 U.S. 308, 318. 96 S.Ct. 1551. 47 Parallel Citations L.Ed.2d 810 ( 1976)). The Flournoys failed to secure a jwy finding on their claim, and the jmy was free 50 Tex. Sup. Ct. J. 975

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Case-law data current through December 31, 2025. Source: CourtListener bulk data.