montgomery v risen # 110 aug 21 transcript as attached ecf 111-1

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IN THE UNITED STATES DISTRICT COURTSOUTHERN DISTRICT OF FLORIDA

MIAMI DIVISION

CASE NO.: 15-cv-20782-JEM

DENNIS L. MONTGOMERY, ) ) )

Plaintiff, ) v. )

) August 21, 2015 JAMES RISEN, et al., )

) )

Defendants. ) Pages 1 - 97_________________________/

DISCOVERY HEARING PROCEEDINGS

BEFORE THE HONORABLE JONATHAN GOODMANUNITED STATES, MAGISTRATE JUDGE

APPEARANCES:

On behalf of the Plaintiff:

KLAYMAN LAW FIRM 2520 Coral Way, Suite 2027, Miami, FL 33145 BY: LARRY E. KLAYMAN, ESQ.BY: DINA JAMES, PARALEGAL

Case 1:15-cv-20782-JEM Document 111-1 Entered on FLSD Docket 08/31/2015 Page 2 of 99

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APPEARANCES CONTINUED:

On behalf of the Defendant:

Davis Wright & Tremaine 1919 Pennsylvania Avenue, NW Suite 800, Washington, DC 20006 BY: LAURA R. HANDMAN, ESQ. BY: BRIAN W. TOTH, ESQ.

Transcribed By: Bonnie Joy Lewis, R.P.R.7001 SW 13 StreetPembroke Pines, FL 33023954-985-8875

[email protected]


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(Thereupon, the following proceeding was held:)

THE COURTROOM DEPUTY: U.S. District Court for the

Southern District of Florida is now in session. The Honorable

Jonathan Goodman presiding; Case Number 15-27082-cv-Martinez.

Dennis Montgomery versus James Risen, et al.

THE COURT: Good afternoon, folks.

Let's have appearances, starting first with the

Plaintiff.

MR. KLAYMAN: Larry Klayman, counsel for Mr.

Montgomery, with my paralegal, Miss Dina James; D-I-N-A.

MS. HANDMAN: Laura Handman, counsel for the

defendant, with Davis Wright Tremaine. And with me --

MR. TOTH: Brian Toth for the defense as well.

THE COURT: Thank you, folks. Please be seated.

So I am starting a hearing now and it is five

minutes before the scheduled 3:30 start, but we may need to

take a break in the middle to deal with a criminal matter that

was left over from the 1:30 calendar. It should not take too

long to address that matter once the Marshal Service brings in

the missing defendant. I was expecting that that would happen

already, but it has not happened.

So we are here on a discovery hearing. And I know

from a filing that Mr. Klayman made this afternoon with another

motion, which is not before me, a response to extend certain

deadlines, but in that response filed today, Mr. Klayman gave


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notice that Mr. Montgomery's deposition was taken yesterday,

correct?

MS. HANDMAN: Yes, Your Honor.

THE COURT: And that was a full seven-hour

deposition?


THE COURT: And I would assume that the deposition

was taken in Miami and that would explain why all the

out-of-town lawyers are here today, correct?

MR. KLAYMAN: Correct, Your Honor.

THE COURT: So I understand that there are several

discovery issues.

And I have to tell you that I read all the papers

and you all submitted a memorandum and I read Mr. Klayman's

submission, albeit not one directly in response to this

discovery issue, but in response to the Defendant's request to

extend certain deadlines.

And I am summarizing here and basically, in this

submission today that Mr. Klayman took the position that I have

provided all the discovery. The Defendants know that I have

provided all the discovery. They knew it at the time that they

filed their discovery hearing.

And in effect, Mr. Klayman is accusing the

Defendants of acting in bad faith of conjuring up a non

existence illusory discovery dispute because according to Mr.


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Klayman, my God, his client has turned over massive amounts of

material and the Defendants are simply harassing him.

Is that a fair statement, Mr. Klayman, of your

filings today?

MR. KLAYMAN: It is not quite that strong, Your

Honor. It may be strong from time to time. We provided all

the information that is required. There was a deposition for

seven hours yesterday. Mr. Montgomery was in great discomfort

and pain.

And some day perhaps you might want to look at the

video of that and he sat for seven hours. And they were able

to ask followup questions for the documents that we provided.

Let me give you one example. Income tax returns

where they wanted to know why certain years were not available

and he answered those questions with regard to why they had

been not available. We believe that everything has been

satisfied.

The only issue that has been outstanding here is

the issue of Mr. Montgomery's software. We believe that that

software is likely classified. For the last year, Mr.

Montgomery has, for more than a year, has been coming forward

as a whistleblower to the NSA, the CIA, the Department of

Defense, the FBI, and the Department of Justice and other

agencies, including Congress in trying to provide information

to the FBI so they could look at it. Because one of the things


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that he has that is not part of this lawsuit, is what appears

to be unconstitutional surveillance on hundreds of millions of

American citizens, including federal judges.

So that has been turned over to the FBI. The FBI

is determining whether or not the software is classified or

not, but in any event, what has been alleged in the pleadings.

And I have copies by the Defendants in their Motion to Dismiss

that they have said to this Court this case can be dismissed

because all you need to rely on is public information and that

was available in court documents and in testimony before

Congress and you don't need any information from the

government.

And in fact, when I deposed Mr. Risen a while

back, he confirmed that he did not have access to government

classified information. So it's a nonissue, the software,

because they have said it right up front that they are not

relying on any government information.

And of course, we now know -- it has been in the

news lately and we are not trying to sensationalize anything

here, but the sensitivity of turning classified information

over to a private source. Even Mrs. Clinton is in some

difficulty these days for that and you just can't do it. So

the FBI has that and is analyzing the nature of that

information.

THE COURT: The FBI has the software?


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MR. KLAYMAN: They have the software, yes.

THE COURT: How did they get it?

MR. KLAYMAN: Because Mr. Montgomery provided it

to them.

THE COURT: When?

MR. KLAYMAN: He provided it to them three days

ago. It has been in the process to provide that to them and he

provided them a lot of other information too, which they are

looking at because it is classified information and he is a

whistleblower.

THE COURT: Folks, excuse me, I think I saw the

Defendant there. So I am going to ask you to step back,

please, and allow the Defendant to come in and we will let the

prosecutor and the Public Defender's Office take their places.

MR. Klayman: Leave our papers here?

THE COURT: You can leave them there, but it's up

to you.

MR. KLAYMAN: I just put them here so it is not in

anybody's way.

(Recess.)

THE COURT: Michael, do you need to call this case

back on the record or we are already there?

THE COURTROOM DEPUTY: We're back on the record in

Case Number 15-CV-20782.

THE COURT: Mr. Klayman, you were explaining to me


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sort of an update on what has been happening with the

discovery. And in particular, you were telling me about the

software which you and your client have repeatedly asserted in

this case is likely confidential, or possibly confidential, or

something like that as if.

MR. KLAYMAN: Correct.

THE COURT: And you did mention to me three days

ago either you had or Mr. Montgomery submitted the software so

the FBI so the FBI could confirm one way or the other if the

software contained classified information; is that correct?

MR. KLAYMAN: That is correct.

THE COURT: And so when this software was turned

over three days ago, did either you, or Mr. Montgomery, keep a

copy, or you just gave the software?

MR. KLAYMAN: We just gave it to them.

THE COURT: No copies?

MR. KLAYMAN: It was just the software and

relative to this case the software is included.

THE COURT: And what else did you turn over

besides the software? For example, were there reports

analyzing the software?

MR. KLAYMAN: I don't know because I never look at

it myself. I don't want to look at it. It's not my province.

THE COURT: Do you have a feel generally by way of

a description of what was turned over, other than the software


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itself? You told me that the software was only part of the

materials turned over.

MR. KLAYMAN: I'm sorry, Your Honor.

THE COURT: What other category of --

MR. KLAYMAN: Generally speaking, and this is a

matter of some confidentiality as well because there's an

investigation going on by the FBI, but generally speaking, the

part that is public is that my client, Mr. Montgomery, who was

obviously written up in Mr. Risen's book as being an effective

franchise of the ability to analyze data, this encrypted data

of terrorists doing business, so to speak, all the over the

world in al jazeera and otherwise.

He has information that government agencies, much

like happened with NSA and Edward Snowden and others have been

doing massive surveillance on American citizens, including

federal judges, magistrates, members of Congress and others and

operating illegally here in the United States, CIA.

THE COURT: I think I did a bad job of asking my

question, sir. So I am going to try it again --

MR. KLAYMAN: Okay.

THE COURT: -- with my question.

I am not asking you to launch into an argument,

which quite frankly, is what you are doing. I do not need a

lot of rhetoric. Here is my question, Mr. Klayman.

MR. KLAYMAN: Sure.


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THE COURT: What else besides the software,

itself, was turned over to the FBI three days ago?

I'm following up on your comment that the software

was only part of the information turned over to the FBI. So

naturally, in my mind I am saying to myself, gee, I wonder what

else was turned over to the FBI beside the software.

That's the information I am looking for. Tell me

in factual format the description of the other information

turned over besides the software. Please do it without

rhetoric and argument.

MR. KLAYMAN: I was trying to be as precise as

possible based on what is publically known at this time. It,

basically, is evidence of mass surveillance of American

citizens.

THE COURT: That's really not what I was looking

for.

MR. KLAYMAN: It includes credit card numbers,

banking information, names of millions of Americans.

THE COURT: That is still not what I am looking

for. Let me do a better job.

Simply sort of a summary conclusion. So is the

type of other information e-mails, memos, phone records,

regular old printed documents, data basis? I mean, what is it?

You just told me it is evidence of mass surveillance.

MR. KLAYMAN: It would include --


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THE COURT: What exactly was turned over?

MR. KLAYMAN: It would include what you just

listed.

THE COURT: And anything else?

MR. KLAYMAN: Not that I know of. I have never

looked at the information.

THE COURT: And who actually turned it over, you

or Mr. Montgomery?

MR. KLAYMAN: Mr. Montgomery.

THE COURT: Did you participate?

MR. KLAYMAN: I was present.

THE COURT: We are going to really have a long

hearing if you continue to clip me off before I finish my

question. Maybe you were going to correctly guess at what I

was going to ask, but you really need to let me finish asking

the question.

MR. KLAYMAN: Sure.

THE COURT: So did you participate for the

arrangements for turning over this material?

Because I am guessing, just a guess, that Mr.

Montgomery didn't just show up at the FBI headquarters in

Washington, D.C., knock on the door and say, here, probably

something had to happen before that. Am I right?


THE COURT: Okay. So tell me about the


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arrangements that led up to the turning over of this material

three days ago.

MR. KLAYMAN: The arrangements were made through a

federal Judge in Washington, D.C. Lamberth, U.S. Court for the

District of Columbia who had contacted the FBI because of

information that Mr. Montgomery had.

And meetings were held with the general counsel of

the FBI working under the aegis of FBI director James Comey.

And consequently, as a result of that, the information was

turned over.

THE COURT: All right. And how was it that a

district court judge in Washington, D.C. was involved in this

situation? Is there a lawsuit pending there?

MR. KLAYMAN: There is no lawsuit.

I approached that judge because I know that judge

and I have had cases in front of that judge. I know him to be

an extremely reputable and honest person with great integrity.

THE COURT: So when you say you approached the

judge, did you file something in court? Did you just show up

in his chambers? I mean, how did this happen?

MR. KLAYMAN: Long before this case was filed, we

approached the judge in Washington and said how could we get

this information to the government because Mr. Montgomery is a

whistleblower and no one has wanted to listen to him so far.

THE COURT: And so when you made this approach to


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the judge, and the name of the judge again is?

MR. KLAYMAN: Royce C. Lamberth.

THE COURT: Right. And so, before this lawsuit

was filed against Mr. Risen and other defendants, you contacted

Judge Lamberth?


THE COURT: And when you did that was it in the

form of a pleading? Did you just show up in his chambers? How

was that done?

MR. KLAYMAN: We met with him in chambers.

THE COURT: In chambers?

MR. KLAYMAN: Yes, with Mr. Montgomery.

THE COURT: And then, am I correct in

understanding that at some point, Judge Lamberth ordered you to

turn over that material to the FBI?

MR. KLAYMAN: No. We asked him for his assistance

on how we could come forward with that information because we

thought it should be in the government's hands being that it is

highly sensitive, that it is classified and even he was not

able to look at it.

I didn't look at it. Nobody looked at it, but we

wanted to come forward and because Mr. Montgomery, long before

he became my client had been trying, as I mentioned earlier, to

come forward as a whistleblower to various government agencies

and nobody wanted to listen to him.


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THE COURT: So this lawsuit was filed

approximately when? Let me see. Maybe I have it on my --

THE COURTROOM DEPUTY: February 24th, Your Honor.

THE COURT: Of this year?

THE COURTROOM DEPUTY: Yes.

THE COURT: So when was it that you approached

Judge Lamberth?

MR. KLAYMAN: October of last year, approximately.

I could go back and check. I do not have the exact date.

THE COURT: All right. And so what, ultimately,

happened with Judge Lamberth, which led to the turning over of

the software and the information to the FBI three days ago?

You told me that he did not enter an order, correct?


THE COURT: Okay. So what did he do? Did he pat

you on the back and say, Mr. Klayman, sounds like a good idea

to me, go to it? Did he issue some kind of an ex parte

document? Did he contact the FBI and say I think it will be a

good idea for you to receive this information?

MR. KLAYMAN: No.

THE COURT: What exactly happened? Because I have

to tell you that it sounds somewhat unorthodox to me.

MR. KLAYMAN: It is unorthodox because this has

never been done before. We have never been in this situation.

I trust Judge Lamberth and I had a number of cases


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before him in the 1990s and after that was all over I got to

know him better. I didn't have any cases with him. And

consequently, he arranged because we needed to get this to the

highest levels of the FBI and also to the highest levels

potentially, of the Justice Department, this information.

So he arranged for meetings with the general

counsel of the FBI, James Baker, who then facilitated bringing

in agents, FBI agents, to acquire this information to collect

it and that's how it occurred.

THE COURT: All right. And what, ultimately, led

to the turning over three days ago of the information? Did the

FBI general counsel contact you or Mr. Montgomery and say,

okay, now is the day, turn it over? Did they direct you to

turn it over? Did they give you the opportunity if you wanted

to but you were not required to? How exactly did that unfold?

MR. KLAYMAN: Well, what unfolded, we had the

meetings. And the general counsel of the FBI James Baker, who

works directly under the director James Comey, facilitated

bringing in a team of agents to turn it over. And assistant

U.S. attorney of the District of Columbia to supervise that and

her name is Deborah Curtis.

So we've had -- we turned it over to both the FBI

and the Justice Department.

THE COURT: Jointly?

MR. KLAYMAN: Jointly.


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THE COURT: Two copies, one for the FBI and one

for the Justice Department?


THE COURT: And was this done actually at the FBI

headquarters in Washington, or did some agent visit your client

at his home or residence, or some other place, and it was

turned over there?

MR. KLAYMAN: It was done at FBI headquarters here

in Miami, in Miramar.

THE COURT: And you and Mr. Montgomery went there

in person?

MR. KLAYMAN: Correct. Along with Miss James.

THE COURT: And before this happened, given that

the Defendants in this case had been repeatedly seeking this

particular software and there was litigation over the

discoverability and litigation and arguments raised about the

secret nature, or alleged secret nature, or classified nature

of this material, did you give the Defendants in this case

advanced notice that you were going to be turning over this

material to the FBI?

MR. KLAYMAN: We did not because this was not

something that was done with the confidentiality, the cloak of

confidentiality, but we did arrange, Your Honor, with the FBI

that we do have continuing access. Mr. Montgomery has

continuing access to documentation which is not classified, or


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otherwise sensitive and privileged with regard to the

government.

So if there is anything that we need from what was

turned over, it is still accessible to Mr. Montgomery.

THE COURT: So I mean, this arrangement that you

just explained to me, especially this continuing access, is

there a written document outlining Mr. Montgomery's rights to

this information, a memorandum of understanding, an agreement,

a contract, something?

MR. KLAYMAN: There is a document that was

produced. It's a letter prepared by the U.S. attorney on

behalf of the Justice Department, which says that, in effect,

Mr. Montgomery has immunity for turning this over in terms of

the documentation.

THE COURT: Well, that is a little bit different

than saying he has continuing access.

MR. KLAYMAN: Well, this is an agreement that we

do have. Okay. It could be for anything that is not

classified.

THE COURT: So he has, according to you,

continuing access to nonclassified information?

MR. KLAYMAN: Correct, which has yet to be

determined.

THE COURT: I understand, but he wouldn't have

continuing access to classified information.


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MR. KLAYMAN: I would assume that's the case. I

don't think anybody should have access to that.

THE COURT: And how long did you anticipate it

will take for the FBI to determine one way or the other to

whether any of the information, including the software is, in

fact, classified?

MR. KLAYMAN: Before I answer that, let me add one

other thing, which I think is important, is that Mr. Montgomery

will have a top secret clearance, an SAP clearance, S-A-P and I

believe that he still has top secret clearance and it was never

revoked.

In order to revoke it you have to have a hearing

and no such hearing ever took place. And in fact, he testified

to that yesterday at deposition. I instructed him at the

deposition, when he was giving answers, to be careful not to

reveal anything which may belong to the government.

And what was the last question, Your Honor? I

apologize.

THE COURT: It might have been the previous

question. I had asked you is there some document that

memorializes Mr. Montgomery's continuing access to

nonclassified information which was turned over to the FBI?

Your response was really a nonresponse.

MR. KLAYMAN: Yes, there is --

THE COURT: You have to let me finish.


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MR. KLAYMAN: I'm sorry.

THE COURT: Your response was he has immunity

pursuant to a letter drafted by the assistant U.S. attorney.

And my response was, well, there is a difference between

immunity for turning over information and having continuing

access.

So the question is, is there a document, a letter,

a memo, or anything else memorializing your comment to me that

Mr. Montgomery has continuing access to nonclassified

information, which was turned over to the FBI?

MR. KLAYMAN: There is no such document, but there

is an agreement between us which was entered into during the

meetings if that would be the case.

And it is my understanding, to answer your

question, because now I remembered what your last question was

is that the FBI is moving with great speed on this because Mr.

Montgomery is seriously ill and he may not live. And that's

one of the reasons, Your Honor, we oppose any postponement. He

may not live at the time of any trial. He may not be alive.

THE COURT: So I understand the general response

that the FBI will be moving with all due diligence, with

alacrity, with efficiency, et cetera, but those are just

general adjectives. It doesn't really give me an idea. Are we

talking about a week, a month, six months, two years? What do

you think?


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MR. KLAYMAN: Well we have to get some feedback on

that because they haven't had an opportunity to go through it

yet. There are a number of hard drives that were turned over.

THE COURT: And is this afternoon, right here in

court, the first time that the Defense is learning that Mr.

Montgomery turned over the software that they've been seeking

for months to the FBI, or did they know about it before this

hearing?

MR. KLAYMAN: He testified about it yesterday, Mr.

Montgomery.

THE COURT: Well, I'm guessing that counsel may

have asked some of the same questions that I asked and perhaps

differently and perhaps additional ones.

All right. So let me just hear from the Defense

for a minute.

MR. KLAYMAN: May I just add one last thing here?

THE COURT: Yes.

MR. KLAYMAN: If possible. The reason that the

software is not relevant to this matter -- and I have a copy of

the Motions to Dismiss that are still pending by the Defendant

if Your Honor would like a copy of it -- is that they argued

that they don't need government information for this case to be

decided. That everything that Mr. Risen published was based

upon information that was out in the public domain in testimony

before Congress, or prior articles written by Playboy Magazine


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-- if you can believe that -- and others about Mr. Montgomery,

but they didn't have access to government information because,

you know, we made reference to the fact that he may have had

unauthorized access to classified information and they denied

that.

And when I took Mr. Risen's deposition -- and I

also have the deposition pages and I can cite them to Your

Honor -- he confirmed that he did not have access to classified

information. So consequently, it's not relevant what is on

this software, which is believed to be classified because he

never relied on that and doesn't want to rely on that.

As Your Honor may know, Mr. Risen was involved in

a very controversial case with an individual by the name of

Jeffery Sterling, who was indicted by the Justice Department

for having one classified e-mail. And Mr. Risen was, himself,

he got to the edge of being indicted himself for having access

to that.

The government did not proceed with that case,

presumably because they did not want to reveal the classified

nature of what he had gotten from Mr. Sterling. So they

dropped the charges just in the last few months.

So Mr. Risen is very careful to say, at his

deposition, that he did not have access to classified

information. He equivocated a lot, but in the end if you look

at the testimony, it is clear that he did not and it is


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confirmed by the Motion to Dismiss. In the first ten pages of

the Motion to Dismiss, the Defendants are arguing that there's

no need for classified information, Your Honor. Judge

Martinez, you can dismiss this based upon a privilege that this

was all done from public information that has already been

produced. That's the basis of Chapter Two of this book. So it

is not even relevant.

THE COURT: Is there claims in this defamation

case that Mr. Risen, in his book, published the point that your

client basically bamboozled the government by selling defective

software? Isn't that, basically, one of the main claims?

MR. KLAYMAN: I wouldn't say that's the main

claim.

THE COURT: That's one of the major claims?

MR. KLAYMAN: It's a claim.

THE COURT: Okay. In order to defend against that

claim wouldn't the parties need to know whether the software in

fact worked or not? Isn't that a critical part either in your

case-in-chief or their defense case?

MR. KLAYMAN: That's not what they're resting

their defense case on. And that's what I'm saying is that they

said that this case should be decided, Your Honor.

And they are unequivocal about that based on

testimony before Congress by individuals like Brennan of the

CIA with regard to other things that were available in other


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court documents and you don't even get to that point.

So what we believe, and Your Honor asked me the

question at the outset, we're accusing them of bad faith. I'm

not accusing them of bad faith. I'm accusing them of being

defense lawyers.

Defense lawyers, I was a defense lawyer myself,

civil and criminal. I was a prosecutor for the Justice

Department and a defense lawyer at the same time. I helped

break up AT&T. So I know what complex litigation is about.

They're using this as a fulcrum, a wedge, to try

to get this case delayed. That is their intention. And what I

am saying is that there is no need to delay the case. The FBI

is analyzing this right now. There is time to complete

discovery. And in any event, we can't put the trial off

because the Defendant may be dead.

We approached Judge Martinez on that very first

status conference months ago and that's why he set us so

quickly for trial. I am not accusing them of anything. I am

saying they're doing their job as defense lawyers. This is not

an ordinary case.

It potentially is a case which involves, not in

part of the allegations of this case, but the other stuff that

Mr. Montgomery has deals with a massive breach of individual

privacy throughout the United States and that has nothing to do

with this case.


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THE COURT: So let's assume that Mr. Risen based

his book only on public information.

If that published information included the

conclusion that the software is bogus and did not work, even if

he got that information publically, the key fact in the case

would be if that's truth was the software bogus or not?

So I do not really see whether it matters.

Whether or not the information that Mr. Risen relied upon is

public, or private, or confidential, or sensitive, or

classified. One of the claims is that the Defense committed

defamation, Mr. Risen and the publishing company, created

defamation by falsely publishing the allegation that your

client sold bogus software, that did not work, to the

government.

And then, as part of your case-in-chief, to

demonstrate the falsity of that statement they have to prove

that the software, in fact, did work. And as part of the

defense case whether or not it was their burden or not, they're

going to try to show that the software did not work. So to me

that is still a relevant issue.

Explain to me why --

MR. KLAYMAN: Based on the facts of this case,

Your Honor, that would respectfully not be a way that they

would go about defending themselves, I would think, and know.

One of the things that came out in deposition and in the


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documentation -- because we had produced already about over

40,000 documents to the Defendants.

THE COURT: Excuse me for interrupting.

By the way, I am never, ever impressed by that

argument. Lawyers tell me those things all the time. They say

Judge, I produced 35,000 documents. I produced a million

documents. And my response is, so what?

If you produce 50,000 documents and you still have

45,000 documents that you have not produced, I am not

particularly impressed by the 50,000 number. There is 50,000

documents, but there's one document that you did not produce

and that is the smoking gun document. I am not particularly

impressed that you produced the 50,000 documents if you are

withholding the one most important document.

So by way of background, you have to tell me how

many documents --

MR. KLAYMAN: It's the quality.

THE COURT: That to me is not really a critical

point.

MR. KLAYMAN: What i'm trying to say is my

understanding is from Mr. Montgomery that we have produced

everything except the software.

THE COURT: I am going to hear from the Defense,

but I am going to say, Mr. Klayman, that the Defense is going

to, one hundred percent, disagree with you.


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MR. KLAYMAN: Of course.

THE COURT: I am going to tell you that right now.

MR. KLAYMAN: Of course, but let me finish the

point, if I may?

THE COURT: Sure.

MR. KLAYMAN: During the course of Mr. Risen

writing the book, he contacted Mr. Montgomery and he said this

is what I am writing. Do you want to comment?

This is in the deposition yesterday. Of course it

is under seal, okay, but this part is not really confidential.

In any event, we're not going to claim that. And he demanded

that he would not correct what he was writing and he would not

write it as Mr. Montgomery saw it, that he did not in any way

defraud the government, or do the greatest hoax in American

history. That's in the book, okay.

And I might add that Mr. Montgomery is sick and

Mr. Montgomery really can't defend himself. He is not paying

me legal fees. And we believe that Risen knew that he could

use Mr. Montgomery as a launching pad for his book that the

government, as a whole, had misused all this money in the war

against terror.

Mr. Risen does not like the government. He did

not like George W. Bush. He was selling this book on the basis

that the government has wasted all this money. Mr. Montgomery

was, of course, the focus . So he says to Mr. Montgomery,


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either you give me classified information or I'm going to write

this. And Mr. Montgomery says to him, I can't give you

classified information. That would be a crime.

Risen was doing the same thing that he was doing

to Jeffery Sterling. In effect, he was extorting Mr.

Montgomery to give him classified information and Mr.

Montgomery did the right thing.

I might add that Mr. Montgomery, you know, has

done the right thing here. He is not in Russia like Edward

Snowden. He is here. He is cooperating with the U.S.

Government. And I can appreciate that as a former Justice

Department lawyer. I feel that there is a great ethical

responsibility, not just to courts, but also to the American

people to come forward with this.

The bottom line is this, and this is why I say

this, is that Mr. Risen, in effect, acknowledged that he did

not have classified information and did not rely on it and he

made this stuff up out of whole cloth. And unless Mr.

Montgomery was going to break the law and commit a crime that

he was going to defame my client.

THE COURT: Mr. Klayman, I am going to take a

guess that the Defense is going to take defensive issue with

your allegations that in this deposition Mr. Risen admitted to,

quote, making this up out of whole cloth.

MR. KLAYMAN: No, that's my characterization.


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THE COURT: I think you just said Risen admitted

that in his deposition.

MR. KLAYMAN: Effectively, I said.

THE COURT: Well, that's how I interpreted it.

And as soon as I heard that I said, oh, my gosh, that would be

astounding and basically --

MR. KLAYMAN: Mr. Risen is a highly intelligent

man and no one doubts that, but Mr. Risen has gotten himself

into trouble in the past.

As I said, he almost got indicted recently over

the Jeffery Sterling affair. And Mr. Montgomery was not going

to be turning over classified information to him on threat that

if he didn't this is what Risen was going to publish.

So it is our position, our firm position, that

this information is not relevant. I am not accusing Defense

counsel of bad faith or doing what Defense counsel do. You

know, regrettably --

THE COURT: Not just Defense counsel.

It is what lawyers do. They make arguments

whether you are a Plaintiff's lawyer or a Defense lawyer. I

have seen Plaintiff's lawyers take plenty of disingenuous

positions. And I think Defense lawyers are not any more or any

less disingenuous than Plaintiff's lawyers.

I mean, American lawyers, when they do what they

do because they think they need to do it to zealously advocate


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on behalf of their client, but Mr. Klayman, you've spoken for

quite a long time and I am going to give you more time, but I

am going to shift to the Defense.

Have a seat.

MR. KLAYMAN: Sure.

THE COURT: First of all, Counsel --

MS. HANDMAN: Yes, Your Honor. Nice to see you in

person.

THE COURT: All right. Thanks for that.

So please explain to me whether the software is

relevant and explain to Mr. Klayman that the software is not

relevant because Mr. Risen said that he did not rely at all for

his book upon classified information, but instead relied only

on things in the public domain.

So first, armed with that fact, is he contending

that the software is relevant; yes or no?

MS. HANDMAN: Yes, it is critically relevant.

THE COURT: Why?

MS. HANDMAN: Because as Your Honor correctly

pointed out, our Motion to Dismiss did not address one critical

defense, which is that Plaintiff has the burden, actually, of

showing that what we wrote was substantially false.

And you are absolutely right, Your Honor, that the

crux of the claim is that he claims that we falsely said that

he was selling bogus software to the United States. And that


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is the claim, as Mr. Klayman quite correctly says, all this

deal about mass surveillance and the NSA, that's another case

that Mr. Klayman has. It has nothing to do with this case.

And the software, we have hired a software expert

to analyze whether this software, the software that was part of

that in 2003, the company he was with in 2003. And then,

subsequently, in 2006 and 2007 and 2008, whether that software

works or not.

And we found out for the first time yesterday that

he had given it to the FBI. He did not give us this story that

we've heard today about Judge Lamberth, who I know well, too,

and going to the FBI, et cetera.

He just said that he turned it over to the FBI and

he did not keep a copy of his own software. Notwithstanding

that he knew we were seeking the software. That was shocking,

to say the least. And this is software that is also, first of

all, the subject of the prior proceedings in Nevada.

THE COURT: Right. I read that opinion where the

court concluded that the software was not classified and

ordered Mr. Montgomery to turn it over. And when he refused to

do it, the judge held him in contempt and he, ultimately,

entered into a consent and later filed for bankruptcy. So I am

aware of that history.

MS. HANDMAN: And that's even Mr. Klayman recounts

in the case in the supplemental filing that we made on Monday


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in the Ninth Circuit. He says that the Court for the District

of Nevada has already ruled that the data documents,

intellectual property, tangible objects, and personal property

at issue in this case. This was the case before Arpaio, Judge

Arpaio, belonged to Dennis Montgomery. None of it was

classified.

THE COURT: I don't think it is Arpaio. I think

it is --

MS. HANDMAN: It is Judge Snow who made -- and

Judge Snow ordered that some of the documents that Mr.

Montgomery had given to the Maricopa Sheriff's Department be

handed over to the Department of Justice.

We have notified, as Mr. Klayman knows and as we

put in our papers, we notified the lawyers in the DOJ who

participated in the Nevada proceedings that entered into the

protective order in the Nevada proceedings that have

participated in the Arpaio proceedings.

And we notified them about what we had requested

and what was the Plaintiffs' response saying it was classified,

that this hearing was going on, that the deposition was

yesterday. And they have chosen not to appear and only the

government can assert the state's secrets privileged.

And I don't even know where to begin on some of

what Mr. Klayman has said about Mr. Risen. I just want to be

very clear. He was never under indictment or indictment


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threatened. He was part of a weak investigative prosecution

and the government had talked about seeking his testimony. He

had asserted the reporter's privilege. The government,

ultimately, did not call him as a witness. So it didn't come

to a head, but there was never any question of criminality by

Mr. Risen in that case.

THE COURT: Let's talk for a minute about

practicality. I know there are other categories of documents

and information that you're seeking.

MS. HANDMAN: Right.

THE COURT: But right now, let's just talk about

the software.

MS. HANDMAN: Correct.

THE COURT: Because that, to me, seems to be a

critical part of the case.

Mr. Montgomery, as part of his case-in-chief, we

need to demonstrate the substantial falsity of the claim in the

book that the software did not work.

And although you might not be under a burden to

prove it the other way, as Defense lawyers you certainly would

want to find out factually whether the software worked or not,

whether it was bogus or not.

So I agree with you that the software is highly

relevant for the case. All right. Fine, but now we have this

significant development that the software is no longer in Mr.


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Montgomery's possession. He turned it over to the FBI.

Apparently, according to this process, which has been under way

for many, many months before the lawsuit was even filed and did

not keep a copy.

So this comes up a lot of times in discovery

disputes, not in this particular way, but the issue is I cannot

get blood out of a stone. I cannot now order Mr. Montgomery to

turn over the software, can I? Because he does not have it.

So what would you have me do now, vis-a-vis this

software that your expert wanted to evaluate to see whether it

worked or not?

MS. HANDMAN: Well, first of all, it is unclear to

me why this software would be part of the whistleblower case

about government surveillance, which even Mr. Klayman says is

not part of our case.

But assuming, taking at face value what Mr.

Montgomery has said and Mr. Klayman has said today, first of

all, Mr. Klayman said that Mr. Montgomery retains access to the

software.

THE COURT: Actually, what he said was, he retains

access to the nonclassified software, but that agreement is

nowhere memorialized in writing and is some sort of oral

understanding that he has with either the AUSA or the Justice

Department, but that is his understanding of his client's

rights.


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MS. HANDMAN: I mean, this is his software. So it

is unclear to me exactly why it would involve any classified

information to begin with.

But even so, you know, we could proceed and we are

planning to proceed on a number of issues to obtain from the

government what Mr. Montgomery has refused to produce.

For example, he pleads over and over in

declarations and amended complaints that there are government

tests validating his software. He has not produced those and

that, obviously, is also critical to this whole situation.

And yes, we relied on that. What we relied on was

filed judicial pleadings that had interviews with former

employees that said that he had these tests in front of the

government in order to pretend that the software, the visual

recognition software, worked.

THE COURT: I'm sorry, Counsel.

You are sort of doing what Mr. Klayman did.

MS. HANDMAN: I apologize.

THE COURT: You are kind of launching into

argument and rhetoric and you are not merely addressing my

question. So let me focus your attention on this.

MS. HANDMAN: Yes.

THE COURT: What relief would you like me to give

you now, vis-a-vis, the software? I know you want it. I know

you have been asking for it. I know you want your expert to


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evaluate it.

So in effect, although in my cases you cannot file

a Motion to Compel. You simply file a discovery hearing

notice, but in reality you are seeking an order compelling the

production.


THE COURT: The problem is based on what we just

heard, and apparently based on Mr. Montgomery's testimony

yesterday, that he no longer has the software.

So I am sitting up here saying, I can only be

asked to provide certain relief. So tell me what you would

like me to do. If you had your druthers, your wish list, would

you have me order Mr. Montgomery to produce the software

knowing that he does not have it and it is in the possession of

the FBI?

Do you want me to enter an order requiring the FBI

to turn it over to you? I mean, tell me, practically speaking,

are what do you want me to do?

MS. HANDMAN: Well, first of all, I would

initially suggest that you do order Mr. Montgomery to produce

the software.

THE COURT: That's sort of a meaningless order.

MS. HANDMAN: Well, except that he does have

access to have him seek access to his own software from the FBI

and produce it to us if indeed that is, in fact, what has


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happened.

Secondarily, you could ask us to notify or you

could order us to notify the people we have notified and tell

them about what is being said here.

THE COURT: Which people is that?

MS. HANDMAN: He said the two DOJ lawyers who have

been involved in past dealings with Mr. Montgomery in Nevada

and in Arizona.

THE COURT: Are these the same government lawyers

who are involved in this Judge Lamberth arranged turnover of

software to the FBI?

It sounds like we are talking about a different

lawyer. It sounds like Mr. Klayman was talking about a local

AUSA in the D.C. office of the U.S. Attorney's Office and not

to the two DOJ lawyers that appeared in Nevada.

MS. HANDMAN: The DOJ lawyers that are in the

special programs branch of the DOJ and they have appeared in

the Arizona case and in the Nevada case. And they attended,

for example, a deposition that Mr. Montgomery gave in one of

these litigations to ensure that classified information wasn't

revealed.

If you want to order us to notify them or the FBI

that this is part of this proceeding and we are seeking access

to it, I would be happy to do that. As I said, I have already

notified them of the basic -- and I will tell you why this does


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come as something of a shock.

Mr. Klayman filed, in a lawsuit that he has

against the Obama Administration involving NSA surveillance a

notice before a different federal judge in D.C., Judge Leon,

asking him if Mr. Montgomery could come and appear and testify

in camera ex parte about the NSA surveillance.

This was filed after Mr. Klayman says he

approached Judge Lamberth. So as far as I know, Judge Leon had

not ruled on that last I looked and Mr. Klayman may know if

there has been any further rulings. And in that the Justice

Department did appear and opposed the request.

So there are DOJ lawyers already involved in some

of these aspects of this. And I am happy to bring them, you

know, give them notice because as I said, the fact that he

turned over the only copy he had of his own software to the FBI

two days ago, three days ago, was news to us. And I suspect it

will be somewhat news to the Justice Department.

THE COURT: Well, you don't need me to require you

to contact the DOJ. You can certainly do that on your own,

right?

MS. HANDMAN: I can and I have and I will send

them this transcript. But I do think, Your Honor, ordering Mr.

Montgomery to produce it because, honestly, I would be -- where

he had an obligation to retain a copy of his software while it

was under subpoena here, I think Your Honor should order it and


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order him to seek it from whoever he gave it over to.

So that would be my practical solution for that

and that is only just sort of the beginning of the questions, I

think, that are raised here.

THE COURT: Let me interrupt for a minute.

So Mr. Klayman, if I were to enter an order

requiring Mr. Montgomery to take advantage of his right of

access to the materials that he turned over to the FBI, why

couldn't he simply say give me back my software, or give me a

copy of my software so I could produce it to the Defendants in

this lawsuit?

MR. KLAYMAN: Notwithstanding my other arguments

that is something that could be done, Your Honor. But let me

just correct the record here because there were misstatements

that were made, hopefully inadvertent.

Number one, the number one national security

lawyer in the United States for the Justice Department is the

person that Mr. Montgomery was dealing with, Deborah Curtis.

She has won every award at the Justice Department.

THE COURT: Is she in the Justice Department or is

she at the U.S. Attorney's Office.

MR. KLAYMAN: She's in the District of Columbia.

They, and the Eastern District of Virginia, handle most of the

terrorism cases in the United States. She's the number one

Justice Department lawyer. This guy, Mr. Gomez, is in the


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civil division, special proceedings branch. This is not his

specialty.

Number two, Mr. Montgomery was dealing at the

upper reaches of the FBI, the director himself, James Comey,

who had the courage -- he's a very honest man as I am sure you

have read -- who had the courage to even tell George W. Bush

and then Attorney General Gonzalez that they couldn't engage in

wholesale Internet surveillance of all American citizens. He's

a very courageous FBI director and he's been dealing directly

-- Mr. Montgomery has been dealing directly with the FBI

director.

So this is inconsequential. At the outset of the

deposition yesterday, I believe for intimidation purposes, Miss

Handman gratuitously offered that she has been in touch with

Mr. Gomez of the Justice Department and this is really

complicated what happened and what is happening in Arizona.

And I don't think Your Honor probably wants to

hear all of it, but there is a federal judge out of there --

not of your caliber -- who is essentially out of control. And

actually ordered Mr. Gomez to come in and get documentation

from Mr. Montgomery. He does own the software, but that

doesn't mean it isn't classified. And consequently, frankly,

he wants to be named a justice.

I did advise Miss Curtis of the civil litigation.

I was completely open with her as to what was going on, but the


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FBI is still going to need to determine and the Justice

Department whether it is classified.

And that is something that we want to do for

everybody. We are not just here for Mr. Montgomery, as

important as he is, but we are here for the people of the

United States and the System of Justice.

THE COURT: Correct me if I'm wrong, but didn't a

district judge in Nevada already conclude that this software is

not classified?

MR. KLAYMAN: That decision, okay, was based --

THE COURT: First just answer my question.

MR. KLAYMAN: I didn't read it that way.

THE COURT: You didn't?

MR. KLAYMAN: No. I read it that he, basically,

was giving the information back to Mr. Montgomery because those

Justice Department laws, including Mr. Gomez, had participated

in providing false affidavits to the court and they could not

prove up probable cause and that's the reason it was given

back.

But out of an abundance of caution, the FBI

obviously needs to take a look at this. We cannot compromise

U.S. National Security.

THE COURT: Mr. Klayman, let's take it a step at a

time because like many lawyers, you seem to have difficulty

answering a simple question with a yes or no. You are not


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unique in that regard. Many lawyers are like that.

So here is my first question that should either be

yes, no, or I don't know, for the answer. Did the Nevada judge

enter a written order in which the judge said that the very

software at issue here is not classified; yes or no?

MR. KLAYMAN: I don't know.

Honestly, I don't know. What I do know is what I

told you is that the efforts to gain that information were

quashed because of false affidavits that were submitted by,

among others, with the participation of Raphael Gomez of the

Justice Department.

An illegal search and seizure was conducted on Mr.

Montgomery's house. So whether the judge erred or not in

making that decision, I don't know.

THE COURT: Let me ask Miss Handman because I

think you attached, as an exhibit to your papers, a copy of

this Nevada order.

Didn't the judge there say that the software was

not classified?


And indeed, and that's why he was able to order

and hold Mr. Montgomery in contempt for failing to produce it.

And again, Mr. Klayman, in the Ninth Circuit last week said --

cited the Nevada Court has already -- this is Roman v -- the

U.S. District Court for the District of Nevada has already


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ruled that, one, the data, documents, intellectual property,

tangible objects, and personal property at issue in this case

belong to Dennis Montgomery. None of it is classified and the

U.S. Government was required to --

THE COURT: Okay. So Mr. Klayman, you just told

me no less than a minute and-a-half ago that you, quote, didn't

know, closed quote, if the district judge had designated this

material as classified information. You just said that to me a

minute ago.

MR. KLAYMAN: The way I read --

THE COURT: Defense counsel just read from a

memorandum that you filed in which you specifically said that

the judge indicated the information was not classified.

How can you take two completely different

positions because it sounds to me like you are rapidly losing

credibility, Mr. Klayman. I cannot imagine that you can say

one thing to me now and say the exact opposite in a memorandum.

Could you explain that to me, please?

MR. KLAYMAN: Maybe what was written was written

by somebody else who wrote the brief. Number one, I am not

casting blame. I didn't write the brief, but number two, I

didn't read it that way because there were a number of

decisions here.

There was a magistrate that was issuing rulings.

It wasn't a circuit court and we don't know whether or not it


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is classified or not. But what we have been trying to do in

Nevada was just to come in and make an argument in terms of Mr.

Montgomery's ability to make an argument as to that

information.

I don't know what's in it because I've never

looked at it. Okay. And if we misspoke there, then, we

misspoke and I will correct it, but I did not take that as a

definitive determination of whether it was classified because

no one has looked at it before.

MS. HANDMAN: Your Honor, Mr. Klayman also filed

on his own behalf in Arizona on the same day the same language

in his own motion before Judge Snow.

I would say one other thing which we alluded to in

one of our footnotes in our filing. If we are not able to get

the software we would be, we believe, entitled to either a

dismissal of the case, or at least an adverse inference, or a

factual finding that the software did, in fact, not work.

So that is the ultimate outcome, I think, if

indeed we don't have access to that software for whatever

reason, whether because there are no further copies or the

government won't give it to us.

That is the final solution, shall we say. And in

my judgment, it ends the case. And Mr. Klayman is well aware

of this happening in other liable suits that he has brought

where the presence of classified information resulted in


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dismissal.

So that, I think, if we don't -- I don't know that

we need to reach that at this point, but that is certainly a

possibility as the outcome here.

THE COURT: Let me say this.

I am not at a discovery hearing that is simply

issuing a ruling, or entering a default against Mr. Montgomery,

or dismissing the case, or concluding that you are entitled to

an adverse inference, or even a rebuttable presumption.

If you want that kind of relief you are going to

need to proceed through a separate motion, either an

exfoliation motion, or a motion that you have been handcuffed

and you cannot adequately present your defense. You know what

to do in that.

MS. HANDMAN: Yes, I am not suggesting that this

is the time or place. I am just suggesting you would ask what

relief and, ultimately, that would be the relief if, indeed, we

don't have access. I would say that this discovery dispute is

not limited to the software.

THE COURT: Let's shift to other categories. So

let's do that. I think we have pretty much exhausted what we

can do today concerning the software.

Mr. Montgomery no longer has it and you have asked

me, in any event, to enter an order requiring him to turn it

over which would, in effect, require him to contact the FBI and


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say give it back, or give me a copy.

And then, Mr. Klayman will respond in kind and I

have a feeling of what he is going to say, which is I cannot

turn it over -- Mr. Montgomery cannot turn it over -- because

we have to wait for the FBI to decide one way or the other if

it is classified.

That's your position, Mr. Klayman?


And what I said was that we did inform the

assistant U.S. attorney, Deborah Curtis, of the civil

litigation. We informed her of the need to move quickly and

they agreed to move quickly. And we informed them that we want

to do everything according to the law and that's important.

And just to correct what you said before, Your

Honor, with regard to decisions in Nevada there are varying

decisions all over the place here on the matter. That's one

thing.

THE COURT: Is there a Nevada decision of any kind

concluding that this software is classified?

MR. KLAYMAN: No one ever looked at the issue.

That wasn't litigated.

THE COURT: Is there a --

MR. KLAYMAN: I don't know of one, but I will go

back and look at these decisions also.

THE COURT: Mr. Klayman, what you do is you make a


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comment and, then, the implicit inference is, well, maybe there

is some Nevada decision out there going the other way.

I am talking about a particular order that the

Defense attached as an exhibit, which I read to prepare for

this hearing. And in that order it said this particular

software is not classified.

Then, the Defense called my attention to written

memoranda that you and your organization had filed in which you

concede that the Nevada judge found that the software was not

classified.

Then, you told me something different here in

court this afternoon when you said you did not know one way or

the other if a Nevada judge ever said that it was not

classified.

Then, you tell me that maybe you misspoke. Then,

you tell me that maybe some other lawyer prepared the memo and

you did not have a chance to read it.

And now, you are saying to me, well, there are

plenty of Nevada opinions out there suggesting the way I took

it, sir, suggesting, well, maybe some other Nevada opinion came

to a different conclusion that it is classified.

So my question is, as we sit here today, are you

aware of any Nevada opinion describing, or finding, or holding

that this software contains classified information; yes or no?

MR. KLAYMAN: No, I am not aware of it.


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THE COURT: Okay. That is what I figured.

MR. KLAYMAN: If I was all over the line, I

apologize, but what I was trying to say was no one knows

whether or not it does or it doesn't and that was written in a

brief by some other counsel that works with me. And I agree

that it should be potentially corrected because no one knows.

No one knows.

THE COURT: Just so I am clear --

MR. KLAYMAN: Yes.

THE COURT: This lawyer that you have it out at

the nation's expert as classified information, Deborah Curtis,

just so I am clear, she's an assistant United States attorney

as opposed to a DOJ lawyer and main justice. She's an

assistant United States attorney working in the United States

Attorney's Office for the District of Columbia; is that

correct?

MR. KLAYMAN: Correct. She's working underneath

an individual by the name of Mr. Malice. He is chief of the

criminal division.

THE COURT: Mr. Malice?

MR. KLAYMAN: M-A-L-I-C-E.

THE COURT: First name?

MR. KLAYMAN: I don't remember the first name.

He is chief of the criminal division and she is

one of the number one -- if you just do a Google search, Your


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Honor -- experts in national security information.

THE COURT: All right. So what I hear you

representing to me is that in making the arrangements to turn

over this software and other materials to the FBI, you advised

AUSA Curtis about this civil litigation?


THE COURT: And we need for the FBI to proceed

quickly and make a determination one way or the other whether

this software is classified and you told her that?


THE COURT: And you also told her that in the

civil litigation the Defense had requested the software so that

their expert could examine it?

MR. KLAYMAN: I told her that we wanted continued

access to this information because we have civil litigation

pending.

THE COURT: That sounds to me like your way of

saying, no, you did not --

MR. KLAYMAN: No, I didn't specifically talk about

this matter, but we got an agreement that anything that is not

classified we have access to and that would include this.

THE COURT: So let's go on to the next category

because I think we have exhausted, for now, the concept of the

software and there are a whole bunch of different categories.

Which one would you like to take next, Miss


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Handman?

MS. HANDMAN: Well, actually, I wanted, as you

know we said there was more that we wanted to discuss that we

didn't brief and I think it's an overarching problem.

As you know, you have very specific rules that say

that you cannot respond, I think, by saying here is my

objection, notwithstanding objection, I am going to produce

what I think is relevant. That was the consistent answer to

virtually every interrogatory and virtually every document

request.

THE COURT: I read it.

There are more carved out exceptions and

qualifications than I have ever seen, Mr. Klayman, in your

interrogatory response.

My gosh, it was like a lawyer's opinion letter

where you cannot even figure out what they are saying. Well,

we say this, but we reserve our right to supplement this by

saying this. We do not mean to concede this other point.

It was, quite frankly, a remarkable series of

responses that I have never seen before. There were some

exceptions, and caveats, and carve-outs, and qualifications.

My gosh. It is hard to figure out what you are

objecting to and what you were turning over, but it is now

getting close to 5:00. And so, I really want to focus our

attention on the specifics. I understand that you are not


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happy with Mr. Klayman's general format of responding. And I

am not crazy about it either because, quite frankly, it

violates the discovery rules applicable in this case. I am

aware of that.

Let's move on to a different topic. Income tax

returns, medical records, things like that. The category that

you have pinpointed in your hearing notice and your memorandum.

Which ones would you like to take first?

MS. HANDMAN: Well, let me say one more point, if

I might, Your Honor because of the format. And what came

through loud and clear in the deposition yesterday and the

discovery they have produced because they have not produced all

of the documents that we have requested.

And for example -- and I will just give you one --

we asked for all communications relating to this topic with the

persons named in the initial disclosures by the parties. One

of them was the person that Mr. Montgomery worked for, for more

than four years. Out of that we got five e-mails.

We had from other sources other e-mails between

them that were critical e-mails that were not produced. And

how would we know that? We didn't have that based on the

responses. And that was only one example, but I am happy to

move on to the other things.

Income tax --

THE COURT: Excuse me.


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This, again, happens frequently in discovery

disputes. One party asks the other party for a certain

category of documents. The response is paltry. It's a couple

of documents.

And the party who requested the documents already

has, in its possession, a lot of documents which they take from

other sources. And they say, aha, you see, Judge, the other

side is withholding documents and it is not producing it. How

do we know? Because we have a lot of these other documents

ourselves from other sources.

And the simple answer may be -- I am not saying it

isn't here -- but it may be that the opposing party, the one

who is responsible for producing discovery in this case does

not have that material anymore for whatever reason.

So maybe Mr. Montgomery only has now, years later,

five documents. Maybe you have found 50. All right. Maybe

you do not believe him. Maybe you are suspicious. Maybe you

think he is intentionally withholding the other 45, or more

than 45, but it could be. Who knows? It could be, but the

truth is that he may as of now only have five. I cannot say,

but that argument, while interesting, does not necessarily

carry the day for me because it only goes so far.

Do you see what I am saying?

MS. HANDMAN: Yes. I mean, that's in part what

your rules are designed to flush out so we know is this all


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he's got or is he withholding anything? So that's why I think

it is important that the format be adhered to, but let me go on

to the topics because --

THE COURT: Sure.

MS. HANDMAN: -- they are very important.

The issue of domicile, Mr. Montgomery's domicile

is critical on the threshold questions of whether there is

personal jurisdiction over Mr. Risen. Whether venue is proper

here.

THE COURT: Really, it is all relevant and it is

all discovery. You do not need to persuade me of that.

MS. HANDMAN: Well, here is what we learned

yesterday.

THE COURT: Okay.

MS. HANDMAN: That Mr. Montgomery has not been

here in Miami until Monday. He is using a friend's apartment,

a room in a friend's apartment. The friend is there and he

will pay rent as needed, but he hasn't paid any rent. He lives

in Washington State.

As his lawyer represented just yesterday and last

week to the Court in Nevada, the criminal court in Nevada that

has postponed his appearances for prosecution in Nevada. Just

last week he said that he was too ill to travel to Nevada from

Washington State to appear in the Nevada criminal proceedings.

Yet, he was able to come all the way across the


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country to Miami to pursue his own lawsuit and sit for seven

hours. I agree with Mr. Klayman, they were grueling. And he

presented just the day before, his lawyers presented

information from a doctor saying he was too sick to travel.

So this bears on both the medical records and on

the domicile. He says he has no lease. No written document

with his friend saying he's trying to pursue this. He says he

is looking for assisted living to move to. He hasn't moved any

of his stuff yet.

We are entitled to as much -- he won't produce any

-- I asked him directly. He gets social security disability

insurance? It's apparently deposited in his bank. I said, do

you have a bank account here in Miami? I don't know. It is

CitiBank. I don't know.

We are entitled to have that information. That's

is one of the indicia of domicile because what he said in his

interrogatory, when asked where he is residing, he gave the

address of his friend where he came on Monday and is, you know,

using a room. That is his residence.

And yet, he admitted in testimony that he has been

in Washington State now for years, frankly. And he may intend

to be moving to Florida at some point, but he is clearly not

residing here.

So what we think he needs to be frank and fix the

interrogatory responses and, obviously, we will bring this to


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the attention of Judge Martinez so that he has additional

information to rule on this, but there are other kinds of

documentation of domicile that we would ask for. He says he

has gotten a phone number here. Well, when did he get it?

That kind of thing.

THE COURT: And you are sort of mixing and

matching a couple of different topics. You sort of added in

medical records to the domicile.

So right now I am a very linear compartmentalized

person. I am plotting. I go very slowly one issue at a time.

I am very difficult with multitasking. I am not a 25-year-old

person who can send text messages and listen to music and

upload a photograph on Instagram all at the same time.

MS. HANDMAN: I understand.

THE COURT: One step at a time.

So domicile, I agree you are entitled to all that

information that you asked for. It is relevant. I think and I

do not want to state for certain, Mr. Klayman's argument, but

my impressions from reading his papers is -- Mr. Klayman, you

will tell me if I am right or not -- I think Mr. Klayman takes

the position that we have turned over all responsive documents

concerning domicile.

Is that your position?


THE COURT: So what more is it that you would like


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me to do? He says he does not have it. I know you don't

believe him. I know you think that he is being disingenuous

and you secretly think that he really has documents. Don't you

think that?

MS. HANDMAN: I am not suggesting that.

What I am suggesting is that he refused to

produce, for example, bank records that would show whether he

has moved his bank account where the Social Security is

deposited to Florida. That, the courts say, is one indicia of

domicile and we asked that and he has refused to --

THE COURT: Stop.

Mr. Klayman, have you produced bank records to

reflect one way or the other the location of the bank where Mr.

Montgomery's Social Security deposits are directly deposited;

yes or no?

MR. KLAYMAN: No. We have objected to that, Your

Honor.

THE COURT: That objection is overruled. Produce

those documents.

MR. KLAYMAN: May I add one thing?

Yesterday during the deposition because we took

the position that these things would become relevant, Your

Honor, I've been polite. I did not want to create a

controversy. One time in an earlier hearing, I mentioned how

Miss Handman had not provided correct information to this Court


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about Mr. Montgomery registering to vote. She actually signed

a sworn declaration that he was not registered to vote. Now

that is blatantly false, but I am being polite because I don't

agree with her recitation of the facts here. She has a hard

time with telling the truth.

THE COURT: Wait a second.

Right now I am talking about the representation

that she made that your client has not produced the bank

records to reflect the location of the bank where his Social

Security deposits are deposited. Is that correct?

MR. KLAYMAN: That is correct.

But he testified yesterday that he is using

National Bank, CitiBank and I believe it was Bank of America.

They are national banks. They don't have any one location and

he is getting it. He is currently getting it in Washington

because that's through a national bank and it doesn't matter

whether he is a resident of Florida or not.

And we have produced all the information about his

residency here, but he has voter registration here. He has a

telephone number here. I believe we have produced that, the

telephone numbers in Miami. He has made arrangements to live

here and he testified as to that and that he could not travel

because he fell and hurt himself.

See, this is a characterization of the testimony

Your Honor. We can certainly be happy to put forward his


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testimony, but it was seven grueling hours and he did not

refuse to answer any questions in this regard.

So I don't understand why she is trying to create

this kind of smoke here. We've been forthcoming. He put off

an operation for his brain aneurism to come here and testify,

which is why he is so sick. You could see him shaking at the

beginning of his deposition. It was videotaped.

THE COURT: So this precise issue of the bank

records, Mr. Klayman, which would show the location of the bank

account where his Social Security disability payments have been

deposited, you will produce those records, all the records

within one week.

MR. KLAYMAN: Okay. Could I ask? We would not

like to produce financial information. Could we just show the

bank where it is coming into it?

THE COURT: Well, what I want you to do is you

could redact all the information on those records, other than

the location of the institution and the particular items

reflecting the direct deposit from Social Security. Probably

once a month.

Everything else, all the checks he wrote, the

deposits, credits, debits, you can redact all of that. The key

point here is the location of the bank and the fact that that's

the account receiving the Social Security disability payments.

So that will be done within one week.


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Now, let's go to the next subcategory. Mr.

Klayman says, my gosh, we produced a lot of documents about

domicile, voters registration, et cetera. You have now

pinpointed one category, one subcategory, namely the bank

account location records. Fine. I granted that request.

What else in the category of domicile?

MS. HANDMAN: Well, he testified that he doesn't

have a lease. That he doesn't have any written understanding.

So I have to take his word --

THE COURT: He can't produce a lease if he does

not have a lease.

MS. HANDMAN: We only heard yesterday of this

arrangement that he has with his friend, but what we do want

is, he did testify that he is looking for assisted living and

we asked who is your agent because he says he has an agent.

Who is your agent for that?

What steps have you taken to find assisted living?

So if he doesn't have anything to reflect the arrangement

currently, we would like to know what are the prospective

efforts being made.

THE COURT: There is a problem with that request,

Counsel. In effect, that sounds like more of an interrogatory.

Explain to me the steps that you have taken. Identify the

broker or the agent that you have retained in order to help you

find assisted living.


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That is more of an interrogatory or a deposition

question. Right now my understanding is we are talking about a

document request.

So I think what you are saying is produce to me

documents reflecting or relating to efforts you have made to

obtain assisted living in Miami including, for example, a

contract or a retainer agreement with an agent, or a real

estate broker, or a medical facility's consultant.

That's the kind of thing you are asking for?

MS. HANDMAN: Correct, Your Honor.

THE COURT: Okay. Mr. Klayman, are there any such

documents?

MR. KLAYMAN: I'll check, Your Honor.

That was never actually requested. This just came

up at deposition, but I will be happy to check.

THE COURT: Wait just a minute.

Okay. Again, we proceed in an orderly way. If

you have made a request for production that includes a request

for assisted living documents, then, I will certainly grant

what is, in effect, a de facto Motion to Compel.


THE COURT: If this is something that came up

yesterday in a deposition and it is not covered by a request

for production, then, there is nothing that I can compel

because you have not made that request.


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So is there, in fact, a specific item in a request

for production that you think would cover an effort to obtain

assisted living? If not, I am not going to compel Mr.

Montgomery to turn it over because you haven't asked for it.

MS. HANDMAN: Well, I know we asked for a lease

and Mr. Toth is checking whether for the categories of

documents that we requested, I will say in addition, on the

phone number, they provided the phone number. And we would

like the phone records to show us when indeed the Florida phone

number was obtained. It does also go -- well, I don't know if

you are ready to move to the next topic.

THE COURT: No, we are not ready to move.

Mr. Toth, have you found that particular spot in

the request that would include documents concerning Mr.

Montgomery's efforts to obtain assisted living arrangements in

Miami?

MR. TOTH: Not yet, Your Honor.

MS. HANDMAN: As I said, Your Honor, we only

learned about that yesterday. So whether the request is broad

enough, we will have to check.

THE COURT: Okay. But I understand how things

have unfolded, but I really cannot compel somebody to produce

something and find fault with their production when you only

requested it informally yesterday in a deposition, or maybe

today is the first time you have requested it. I don't know,


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but I cannot fault Mr. Klayman for not producing documents that

have not been requested yet.

MS. HANDMAN: I understand, Your Honor.

And I am not suggesting fault be found. As you

know, Your Honor, we are under this extreme deadline and just

merely the fact that this morning Mr. Klayman filed something

opposing our effort to get extended deadlines.

And says the FBI has to go through all these

documents and go through the classification process, you know,

it is -- and we do have a motion pending and we will,

obviously, bring this all to Judge Martinez' attention, but it

is inconsistent to say the FBI has to go through this process,

but by the way, you can't get an extension of September 16th.

THE COURT: We are back-peddling because now you

are going back to the software and I don't want you to do that.

I have already heard all I need to hear about the software.

MS. HANDMAN: I want to go to the tax returns, if

I may.

THE COURT: Not yet.

MS. HANDMAN: No.

THE COURT: So Mr. Toth, have you finished your

project yet? Because it sounds to me like you haven't found

anything?

MR. TOTH: Your Honor, I looked through them and I

haven't seen any particular request that appears to include the


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information that --

THE COURT: So I am not going to compel Mr.

Montgomery to turn it over because it has not been requested

yet.

Now, we talked about the next category you

mentioned was phone records for the Florida phone because you

want to see when the Florida phone account was opened, or who

opened it, et cetera.

Have you turned over those records?

MR. KLAYMAN: I don't believe those were requested

either.

THE COURT: So here is what we are going to do,

Miss Handman. From now on every time you talk to me about a

particular request of documents that you want produced, let's

first deal with the threshold issue of whether they have even

been requested.

If they have not, I am not going to order Mr.

Montgomery to turn them over. So show me where in the request

for production you have asked for these phone records to

reflect when the telephone number accounts were opened. Is

there such a request?

MS. HANDMAN: I don't know, Your Honor. Probably

not in that specificity.

THE COURT: All right. Well, for the time being,

unless you can call my attention to a particular request later,


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I am not granting that request because it was never previously

requested.

Next category, income tax returns.

MS. HANDMAN: Yes.

Mr. Klayman correctly represented that at the

deposition Mr. Montgomery said he did not have tax returns from

2008 through last year.

What he didn't say was the reason was that Mr.

Montgomery said he has not filed income tax returns for those

years claiming that this was an audit status and claiming that

the government seized all his records on national security

grounds and so he couldn't file tax returns.

THE COURT: Miss Handman, let's assume that that

is completely false. Maybe he has tax exposure. Maybe he is

facing prosecution for failing to file tax returns, but that is

not before me right now. You have made a request for tax

returns.

MS. HANDMAN: We made a broader request, Your

Honor.

THE COURT: My gosh.

MS. HANDMAN: Sorry.

THE COURT: You must be a heck of a person at a

Passover Seder. Can you just refrain, please.

So Mr. Klayman has turned over the returns for

certain years and for the missing years, 2008 through 2012.


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Mr. Montgomery, as I understand it, has testified in a

deposition that he does not have any tax returns. Why?

Because he never filed the returns.

What would you have me do? I can't compel him to

turn over something that does not exist. So, basically, this

should be denied because he does not have them, correct?

MS. HANDMAN: But he asked a broader request.

We asked for records indicating income for the

years 1998, I believe it was. And obviously, if you don't have

the tax returns, there are other ways of producing records that

reflect income.

THE COURT: Show me, or tell me, or read to me the

particular request where you have asked for financial records

reflecting his income from 1998 to present.

MS. HANDMAN: It is item number 52 in our document

request.

THE COURT: Yes.

MS. HANDMAN: Please produce all documents and

electronically stored information concerning any income,

salary, and benefits, and the source of that income, salary and

benefits you received from January 1, 1998 through the present.

Including, but not limited to federal and state

income tax returns, including, but not limited to all 1099

forms, W-2 forms, and schedules for tax years 2008 to 2014,

including, but not limited to any estimated tax submissions for


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2015, or in the alternative as to tax returns, signed releases

which would allow us to get it from the IRS.

So appropo of your bank records, for example,

those records would reflect income and that would be what if

indeed the government had seized his records as he claims, the

bank records would be, obviously, evidence of what his income

was.

MR. KLAYMAN: May I respond, Your Honor?

THE COURT: Yes.

MR. KLAYMAN: By Miss Handman's own admission,

they have asked for records for 16 years. What is the

relevance of that? So we object to overbreadth and harassment

and that is a valid objection.

THE COURT: Miss Handman, why are you entitled to

records dating all the way back to 1998? What was the year of

the alleged defamation?

MS. HANDMAN: The defamation was in 2014, but it

related to companies that he joined in 1998.

I think, if I am not mistaken, we may have in the

meet and confer agreed to limited and I am prepared to limit it

now, but that is the reason for the 1998 date. But the key

date begins in 2003, which is when he starts offering his

software to the government. And that is the subject of the

book, but it was through a company called Intrepid, which was

founded in 1998.


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MR. KLAYMAN: Miss Handman is backtracking right

now to make this look like a legitimate request and it is not.

It is harassment, Your Honor, and we objected

legitimately to it. 16 years is more than unreasonable. I

don't know of any case that you have to produce your financial

records for 16 years when the defamation took place in 2014.

THE COURT: All right. So on this particular

request, which is request number 52, I am going to require Mr.

Montgomery to produce all responsive documents for the years

2003 to date and I will give you two weeks to do that.

Now, I understand Mr. Klayman that Mr. Montgomery

is taking the position that the government seized his records.

However, unless --

Strike that.

However, there may be other documents that are

within his custody or control in which he could obtain, such as

bank records from 2003 to date, such as if he received any 1099

forms or W-2 forms.

He may have received those sorts of tax documents,

regardless of whether he filed an income tax return or not.

Any kind of a K-2 distribution statement, if there are any such

statements. Other records reflecting revenue income from 2003

to date and those will be produced within two weeks.

What is your next category, Miss Handman?

MS. HANDMAN: Medical records, Your Honor.


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We asked for medical records. I believe for --

MR. KLAYMAN: Could we stay on this topic for a

second?

THE COURT: Medical records?

MR. KLAYMAN: No, the issue of the financial

records, Your Honor. I may ask a vacation period during this

time. May we have ten days to produce?

THE COURT: Well, I actually said two weeks.

MR. KLAYMAN: Two weeks. I'm sorry. I didn't

hear you.

THE COURT: Longer than ten days.

MR. KLAYMAN: No, no, that's fine.

Okay. One thing I will point out, this is the

misrepresentations that were made and it is very hard to

address it because Miss Handman is, like, pulling rabbits out

of a hat, but we did produce all of our tax returns from 2003

to 2008.

THE COURT: I understand.

I am not asking you to reproduce the tax returns.

I am talking about other documents; bank records, W-2s, 1099s,

distribution statements, partnership records. You know what

I'm talking about. Financial --

MR. KLAYMAN: And if he has them we will in two

weeks.

THE COURT: If he has them you have to turn them


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over and if he does not have them, then, you cannot turn them

over. I mean, that's --

MR. KLAYMAN: I understand.

THE COURT: -- reality.

All right. Medical records.


We asked for item 33 on our document request for

all medical, psychiatric, psychological and prescription

records pertaining to your health issues referred in Paragraph

13 of the amended complaint.

And that is overall a claim that his medical

condition now where he had aneurism in -- well, it's unclear if

it's 2010 or 2011 and I'll get to that point. And then, a

stroke in the court following aneurism surgery in May of 2014

that somehow in our book in October of 2014 is responsible for

all of the consequences from that, including 11 million dollars

in medical expenses and past and future and all the work that

he is missing as a result of this.

THE COURT: What is that particular paragraph

number in the amended complaint that this relates to?

MS. HANDMAN: It's Paragraph 13 of the amended

complaint.

THE COURT: All right. And that's the one where

he alleges these medical consequences?

MS. HANDMAN: Right. And he says it as much also


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in the answers to interrogatories and he said it as much

yesterday as well that he is claiming that we're responsible

for that.

So Mr. Klayman took the position that we were only

entitled to records from 2011 forward and we have not gotten

any records post April, mid-April. And the only record we got

was a doctor's note, basically, saying he is sick.

And we haven't gotten anything since then and we

didn't get anything pre -- I believe the fall of 2011. Even

though the records that were produced indicated that the

aneurism was first diagnosed in 2010 and two doctors said that

in the records that were produced.

So obviously, aneurisms have a history. And he

did not say that he had headaches before the aneurism, et

cetera, and we think that we are entitled to a full accounting

of all the records that he has that relate to his claim that

we're responsible for his health.

THE COURT: Just so I am clear, Mr. Montgomery,

through Mr. Klayman has produced medical records, but you say

it is not complete. And the categories that you are missing

are, number one, anything after April of this year and before

the fall of 2011.

That is what you are missing on the very tail end

and, then, going back several years.

Mr. Klayman, your position?


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MR. KLAYMAN: It is my understanding, Your Honor,

we will go back and check that we did produce everything,

everything that he has in his possession. We have nothing to

hide in this regard.

I mean, it is to our advantage to produce it, but

you know, this again in my view, is a tactic at the earlier

hearing where Judge Martinez, she mocked his health with regard

to a brain aneurism. And Judge Martinez says, I think my

sister had it. So it is really severe, Miss Handman, so don't

make fun of it. I think that is what got the early trial date,

frankly.

And then, yesterday when my client said he is

feeling bad and wants to take a break, she says to him, well,

that's what you get for filing this lawsuit.

See, this is a tactic. We want to provide all of

that stuff and there is nothing to hide in that regard.

THE COURT: Are there any recent medical records,

Mr. Klayman, from April of this year going forward to the

present that you have not turned over?

MR. KLAYMAN: I will go back and check.

THE COURT: So I am not going to require them to

go way back to 2010. I will require Mr. Montgomery to produce

all medical records that have not yet been produced from April

2014 to the present and that will be within two weeks.

MS. HANDMAN: And if I might just address one


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point. We had offered to do the deposition in Seattle. We

attempted to accommodate Mr. Montgomery in every way. My point

was only that he -- this is a lawsuit he chose to bring.

Therefore, he did sit for a deposition. I do not disagree that

it wasn't difficult and I did not mock, in any way, his

condition at any time.

THE COURT: This is really not a critical issue

for me and I am not going to spend -- by the way, was this a

videotaped deposition?

MS. HANDMAN: Yes, it was.

THE COURT: I am not going to take the time

reviewing a videotaped deposition to see one way or another

whether or not Miss Handman mocked Mr. Montgomery.

My ruling is not based on whether that did or did

not occur. But by the way, just for my own background, Mr.

Klayman, did the Defense offer to take Mr. Montgomery's

deposition in Washington where he lives?

MR. KLAYMAN: Washington, D.C. or Miami. We chose

Miami.

MS. HANDMAN: Not Seattle.

MR. KLAYMAN: All three and we chose Miami.

THE COURT: Okay.

MR. KLAYMAN: For a lot of different reasons.

THE COURT: That's up to you and your client.

MR. KLAYMAN: He traveled here at his expense.


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And you know, one of the things that is evident here, you know,

is that this is going to be a contentious case and we

understand that. We are the Plaintiff.

THE COURT: Okay.

MR. KLAYMAN: Yeah, but I have a long history with

Miss Handman and she has a long history with me. Okay. And

you know, they've got a former FBI agent trailing every one on

this case and that is how contentious it is. That is how

contentious it is.

THE COURT: Are you suggesting that they are

tailing you?

MR. KLAYMAN: They probably are.

I don't care. Your daughter may know a little bit

about my history. I don't know. It doesn't matter.

MS. HANDMAN: I do know that Mr. Klayman had a

process server come to my home at 10:30 at night to subpoena my

husband in a case that he has brought against the Clintons in

the Southern District of Florida.

And ultimately, Judge Middlebrooks threw out the

case and stayed the discovery until he had done so and the

issue never came to a head, but --

THE COURT: Folks, listen, I am sure you both have

a lot of colorful anecdotes about each other going --

MR. KLAYMAN: It's amusing, Your Honor --

THE COURT: It is not amusing.


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MR. KLAYMAN: I understand.

Her husband is Ickes, the closest person to

Hillary Clinton in the United States and I have a long history

with Mr. Ickes, too, on the level of Cheryl Mills and Huma -- I

can't pronounce it -- involved in the e-mail scandal.

THE COURT: Let's get back to this particular

discovery case. I am really not prepared to go into the

alleged Hillary Clinton e-mail scandal. I do not really think

that is quite on point.

So are there any other categories of documents

that you are seeking? We have already covered medical records.

We have covered phone records. We have covered documents

regarding his domicile. We have talked about income tax

returns. We talked about phone records.

What other category?

MS. HANDMAN: Your Honor, there are no other

categories. What we are seeking -- well, I should say the one

other category that is very, very critical is the government

tests that Mr. Montgomery references that validated his

software.

THE COURT: Yes.

MS. HANDMAN: And --

THE COURT: Was that requested?

MS. HANDMAN: Yes.

THE COURT: Tell me what number.


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MS. HANDMAN: And one other thing which was the

location of the software, which I guess now we know is in the

hands of the FBI, but whether it is available at other

locations we don't know.

THE COURT: I saw Mr. Toth circle some things. I

don't know if he found something.

MR. TOTH: I think it is request number 9.

THE COURT: What does number 9 say?

MR. TOTH: Please produce copies of the, quote,

government's own test of Plaintiff Montgomery's software or

your company's software that, quote, confirmed its

effectiveness and reliability, end quote. Referred to

Paragraph 48 of the amended complaint identified in response to

interrogatory 10 above.

THE COURT: All right. So Mr. Klayman, have you

turned over those tests and reports?

MR. KLAYMAN: It is my understanding we have, but

we will check, Your Honor.

THE COURT: Well, I don't know if you noticed it,

but while you were saying that, Miss Handman was vigorously

shaking her head, no, which I interpret it to mean that, no,

you have not.

MR. KLAYMAN: Well, I disagree.

THE COURT: See, this is the kind of thing that

drives me crazy, folks. It happens very frequently. One party


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will say, yes, we turned it over and another party says we did

not.

Is your paralegal a little more familiar with the

specific documents that were turned over than you are?

Typically, in a big case as the lead lawyer may

not have complete familiarity with each and every document and

the paralegals are a little bit more enmeshed in the nuances.

MR. KLAYMAN: They are generally sharper than the

lawyers. In this case that's true.

THE COURT: And all of my paralegals over the

years were way smarter than me. And if you could give me

another handle, ma'am, on whether these tests and reports were

turned over?

MS. JAMES: I believe -- I was in receipt of one

document, a one-page document that I believe was turned over.

If it wasn't turned over, we will be happy to turn it over.

THE COURT: But that's the only test and report

that you have is a one-page document?

MS. JAMES: In my possession. That is correct.

THE COURT: How about in Mr. Montgomery's

possession?

MS. JAMES: Mr. Montgomery has told me that he

provided everything to us that he had, as far as the test

validating.

THE COURT: All right. So what I am going to ask


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you to do because they, basically, told us now on the record

that they've made a representation to a federal magistrate

judge that they have turned over all of the tests and reports

and the software that are in Mr. Montgomery's possession. And

that consists of a one-page document, which was already turned

over.

So within a week, I would like you to advise

Defense counsel with the particular Bates number of the

documents that you turned over, this one-page test or report.

Then, you do not have anything else. So I cannot get blood out

of a stone.

And whether you believe Mr. Montgomery, Miss

Handman, or not, there are certain other steps that you can

take, including, you know, cross-examination at trial and maybe

the jury will find it preposterous that he does not have these

government reports and tests. Maybe they will understand that

he does not have them. Who knows? That is what trials are all

about.

So in any event, you will have that homework

assignment to get the Bates numbers. What did I say, one week?

MS. JAMES: Yes.

THE COURT: One week to designate and advise the

Defense of the one-page report or test that was already turned

over. And if it turns out -- when you go through your records

if it turns out that, whoops, you made a mistake and you did


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not actually turn over that one-page report, even though in

good faith you thought that you did, then, obviously turn it

over within that one week, okay.

MR. TOTH: Your Honor, may I just make one small

point?

THE COURT: Yes.

MR. TOTH: Our request number 7 is well, I think

was also on point.

It is, please produce all documents and

electronically stored information pertaining to all persons

with knowledge of your, or your company's software, or the

location of your software identified in response interrogatory

number 9 above.

I just think that's important because, especially

in terms of turning over the software and documents and

communications reflecting that, that would also, I believe, be

accomplished in that interrogatory.

THE COURT: Mr. Klayman --

MR. TOTH: Excuse me. Request for production.

THE COURT: Would you read that to me one more

time and just tell me the number again.

MR. TOTH: It's number 7, request for production

number 7.

THE COURT: Read it slowly, please.

MR. TOTH: Please produce all documents and


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electronically stored information pertaining to all persons

with knowledge of your, or your company's software, or the

location of your software identified in response to

interrogatory 9 above.

MR. KLAYMAN: Well, first of all, that would

include hundreds of people and to the best of Mr. Montgomery's

knowledge, he did advise --

THE COURT: Just keep in mind, this is not an

interrogatory. It is a request for production?

MR. TOTH: Right.

THE COURT: So if you have a document showing the

identity of a witness who would know the location of the

software, then, you should turn it over.

But I think what Mr. Toth is sort of suggesting is

almost akin to a narrative interrogatory answer, which is

really not appropriate when we are talking about a document

request. So a document request and not an interrogatory.

So have you turned over documents, which would be

responsive to request number 7?

MR. KLAYMAN: Our understanding is that we did,

Your Honor, but we will certainly go back and check.

THE COURT: So for example, if this request number

7 says, produce all documents reflecting the identity of all

persons who know the location of the software, then, arguably

if you had a letter to or from Miss Curtis, the assistant U.S.


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attorney, discussing the procedures for turning over the

software, then, that would be a responsive document.

If you had a communication between you and an FBI

general counsel concerning the methodology and procedure for

turning over the software, then, that document would need to be

produced because that person would be a person who has

knowledge of the current location of the software.

So I know that maybe you think you may have

produced all the documents, but now that I have flagged this

issue for you, maybe you realize that you have not quite yet

turned over all the documents. Unless I am wrong, my

assumption is wrong and you have turned over those documents

concerning the disclosure to the FBI.

Have you turned over those documents?

MR. KLAYMAN: No, Your Honor. That occurred after

the document production.

THE COURT: All right. So your paralegal,

probably your paralegal will be carrying the labeling over

there to track those down and turn them over to the Defense

within ten days, okay.

So let me also just circle back to the category,

or the topic that consumed the lion's share of the deposition,

which is the actual software.

So I am, in fact, Mr. Klayman, going to order Mr.

Montgomery to turn over that software and to take advantage of


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his right of continued access to nonclassified information.

I understand that you may have a certain position

and you may make that position known, but right now that is

going to be my order and you will do what you see fit under the

circumstances.

MR. KLAYMAN: What if it is classified, Your

Honor? What if the FBI determines that it is classified?

THE COURT: Then, we are in completely different

situations, but as far as I know, that has not happened yet.

Listen, you will file in response whatever you deem

appropriate.

I am aware of the history. I think we are all

aware of the practical difficulties in quickly obtaining the

software, given the fact that Mr. Montgomery did not keep a

copy, but for the time being, I am going to enter that order

for whatever it is worth. That is about the best that I can do

under the circumstances.

And if the Defendants later want to file a

different motion, I think Miss Handman was talking about

dismissing the case, and entering a default, an adverse

inference arising from this decision to turn over the software

without keeping a copy and without timely advising them, that

is a different issue for a different day.

Right now we are just here on a discovery dispute.

And my ruling on the software is even though I recognize that


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Mr. Montgomery no longer has it, I am going to order him to

turn it over because discovery requests are not only what is in

your current possession, but in your custody or control.

And you already told me that Mr. Montgomery has

continued access to nonclassified information. So he can use

that as a potential hook or springboard to try to get that

information.

MR. KLAYMAN: That's fine, Your Honor.

We anticipated that and we are respectful of this

Court and all processes of this Court and I respect Your

Honor's decision here.

I would disagree with it, not because of you, but

if it does turn out to be classified that it would, in effect,

cause a crime to turn it over.

THE COURT: I understand.

I am not making any further rulings now than what

I have made today. And so you will do what you deem to be

appropriate and I already have a pretty good idea of what your

position is going to be. We already spoke about that during

this hearing.

MR. KLAYMAN: And assuming, however it comes out

in the end with regard to the software or not, their intention

is to give it to an expert. So there would have to be special

precautions taken in that regard with regard to that expert.

And of course, we need an expert, too, at that point.


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THE COURT: Understood.

MR. KLAYMAN: Now, I have a motion pending, too,

and I realize it is past 5:00 and Your Honor is not feeling

well.

THE COURT: Folks, here is what we are going to

do. We are going to take a five-minute break. I need to take

care of something and, then, we will be back in five minutes

and we will deal with your issue, okay.

(Recess.)

THE COURT: So one other thing concerning the

ruling on the software.

Mr. Klayman, by next Wednesday, you are going to

be writing a letter to the FBI attorney who is involved in this

situation. I think you mentioned general counsel. And you are

going to advise the FBI general counsel, or any other

appropriate FBI attorney involved that I have ordered you --

that I have ordered Mr. Montgomery -- to turn over the

software.

And that I am directing Mr. Montgomery to use his

right of continued access to nonclassified information in order

to obtain the software or a copy of it. You will copy Defense

counsel on that letter and you will file that letter with the

Court under a notice of filing and you will do that by next

Wednesday, please.

MR. KLAYMAN: Yes, Your Honor.


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THE COURT: And we will get to your particular

discovery dispute.

MR. KLAYMAN: Your Honor, I did send to you last

night, and we copied the other side, a redacted e-mail that was

produced --

THE COURT: Yes.

MR. KLAYMAN: -- by the Defendants.

THE COURT: I got that. Let me pull that out

here. Right. It says at the top, redacted attorney/client

work product from Eric Lichtblau.

MR. KLAYMAN: That's Risen's partner.

THE COURT: Meaning, his business partner or his

partner in --

MR. KLAYMAN: Well, you never know.

MS. HANDMAN: He is a New York Times reporter who

co-authored it.

MR. KLAYMAN: Unless you don't live in West

Hollywood you might not know.

Okay. But in any event, Eric Lichtblau is a

reporter is also a national security reporter that works with

Mr. Risen at the New York Times. I know him myself.

And this e-mail, subject, con man to James Risen

says: I got some terrific stuff today. Spent eight plus hours

with the source and left with a thumb drive with 20,000 pages

of documents. I have a much better grasp of the whole story


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line and characters. Hayden and Negroponte were directly

involved, in addition to Cheney aides, plus major involvement

by Kemp, Clinton wing man Burkle, Navy sec, Conrad Burns and

others. Flying back tomorrow -- Eric Lichtblau.

And what they're talking about here are documents

that were obtained from Mr. Montgomery's former lawyer, Michael

Flynn, 20,000 documents.

I took --

THE COURT: I'm sorry.

Let me make this clear. So you are telling me

that the source mentioned in this e-mail is Michael Flynn, Mr.

Montgomery's former lawyer?


And they have had a contentious relationship. Mr.

Flynn, according to Mr. Montgomery, overbilled him

significantly. He couldn't pay and fell into financial

difficulty. Mr. Flynn became hostile and, essentially, tried

to destroy Mr. Montgomery financially and otherwise.

We had requested these 20,000 pages of documents.

Some were produced with the initial disclosures of the

Defendants, but we followed it up with a request for production

for all of them.

At the deposition of Mr. Risen, I asked him about

the 20,000 documents. And initially, he seemed to confirm that

he had them. And then, to make a long story short, Miss


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Handman jumped in with speaking objections and suggested that

there weren't 20,000 documents. And then, when I asked Mr.

Risen if he reviewed the 20,000 documents before they were

turned over --

MS. HANDMAN: 20,000 pages, just to be accurate.

THE COURT: Ma'am --

MS. HANDMAN: I'm sorry.

THE COURT: The rule, in pretty much every court

in the land, as far as I know, it is the no interrupting rule.

It is the same rule that you learn in kindergarten. So please

do not interrupt. If you have something to say, wait until Mr.

Klayman is finished and, then, you may respond.

Understood?

MS. HANDMAN: Yes.

MR. KLAYMAN: 20,000 pages. Okay. I said

documents -- pages -- that's what I meant.

Anyway, Miss Handman wouldn't let him answer

questions as to whether he had turned all these 20,000 pages

over to her and whether they were produced or would be

produced.

In any event, we later served a request for

production and we only got a handful of documents of the 20,000

pages out of that production. Mr. Montgomery is entitled to

those documents.

THE COURT: When you say you received a handful,


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literally, that would mean five or less, five pages out of

20,000. So how many pages did you actually get out of the

20,000?

MR. KLAYMAN: Yes. Of the 20,000 I'm going to go

back and check the exact page numbers, but we only got a subset

of those documents. We are still going through the last

production, but we did get some with the initial disclosures.

THE COURT: Yes.

MR. KLAYMAN: Okay. And they were about 4,400

documents all totaled, not just the Risen documents, but other

documents.

THE COURT: All right.

MR. KLAYMAN: Not just the Flynn documents. Okay.

Pages, okay. 20,000 pages --

THE COURT: Right.

MR. KLAYMAN: -- are at issue here, but we only

got 4,400 documents at the initial disclosures and many of

those were not Flynn related documents.

Okay. Now, we served another request to produce.

And I had my associate go through those documents this morning

that were produced and there were only a handful of documents,

five to ten, that were produced from at least 20,000 pages.

Now, I would like Your Honor to order them to

produce all of the 20,000 pages of documents because they are

Mr. Montgomery's documents . They are attorney/client


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privilege and they are work product. He is entitled to see

what Flynn turned over to Risen.

I think Mr. Flynn has committed a major ethical

violation here in doing that, but that's besides the point. He

is entitled to the documents so we can see if there is anything

discoverable in there that is usable. Because Mr. Flynn, in

retaliation for Mr. Montgomery not being able to pay him,

started to collaborate with Risen and has called my client a

fraud.

I don't know how a lawyer can call a former client

a fraud and, frankly, not be disbarred. And I don't know how

you can turn over 20,000 pages of documents which contain

attorney/client work product to a reporter.

This also bears on Mr. Risen's ethics and

credibility that he would induce Mr. Flynn to violate his oath

as an attorney. So what I am asking for is that all of those

20,000 pages be turned over and produced.

MS. HANDMAN: Your Honor, for all the documents

that Mr. Risen has ever received from Mr. Flynn have been

produced.

The initial disclosures included many of the

documents that Mr. Flynn provided. And if you recall, the

initial disclosures just ask what you are planning to rely on.

Most of what Mr. Risen had were court records that

Mr. Flynn has. There has been endless litigation among these


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various people and a lot of it was court records. Much of it

shows up in our fair report by our arguments on the Motion to

Dismiss.

Mr. Risen was indeed deposed on June 19th. There

had not been any document requests at that time. He testified

at length on this subject and said he didn't believe there were

20,000 pages. That this was for their article that was

published in February of 2011 in the New York Times that

Lichtblau downloaded some of the documents, the ones he thought

interesting and gave those to Mr. Risen. Mr. Risen thought

most of them were court records and that was his testimony.

Then, Mr. Klayman issued a document request for

all documents that Mr. Risen had received from Mr. Flynn. So

we, therefore, produced whatever was supplemental to that on

August 10th. And I, honestly, just as you said to me that

sometimes people say they don't have things and you have to

believe them, that is the case. We have produced what Mr.

Risen had from Mr. Flynn.

THE COURT: Mr. Risen, as I understand it, didn't

get it directly from Mr. Flynn. He got them from Mr. Lichtblau

who, in turn, got them from Mr. Flynn.

MS. HANDMAN: These, in this set, yes.

And then, Mr. Risen, in the course of preparing

his book had some dealings with Mr. Flynn. And I believe he

provided additional information at that time, just as he had


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dealings with Mr. Montgomery and incorporated that information

in his book.

So in preparing his book, he obviously amassed

some additional material beyond what he had gotten from Mr.

Lichtblau. But this specific thing, it is obvious from this

e-mail this was written on the fly on the way back from

California where Mr. Risen believed that was where Mr. Flynn

was.

And there was, you know, maybe Mr. Flynn told him

there was 20,000 pages. Who knows? There were a lot of

documents. We produced them. And you said you didn't want to

know numbers. So I won't give you numbers, but this is

absolutely a fishing expedition. We produced what we had.

MR. KLAYMAN: Your Honor, may I respond?

THE COURT: Sure.

MR. KLAYMAN: What we just heard was testimony by

Miss Handman and not the testimony of Mr. Risen.

Okay. That was the problem at the deposition.

She kept interrupting. It was clear that the 20,000 pages had

been turned over to her and we only got a few out of the 4,400

that were produced in initial disclosures.

Then, we served a Motion to Compel for all of

them. Mr. Montgomery is entitled to all of them. Mr. Risen's

book attributes Mr. Lichtblau in helping him write the book.

They are two top national security reporters for the New York


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Times.

So they are within Mr. Risen's custody,

possession, and control because Mr. Lichtblau participated with

him in writing the book. And you can see, this was not written

on the fly. This is unequivocal. 20,000 pages of documents on

a thumb drive. So all we want is everything that Flynn turned

over to Lichtblau on the thumb drive.

THE COURT: So you have, Miss Handman, all the

documents that Mr. Flynn turned over to Lichtblau, or you have

only the subset that Mr. Lichtblau turned over to Mr. Risen?

MS. HANDMAN: I believe Mr. Lichtblau has given us

his documents and I know that Mr. Risen has given us all the

documents that he got from Mr. Flynn.

And let me just say, Mr. Lichtblau did not

co-author this book. This book is written by Mr. Risen. Mr.

Risen asked him to look over the book to see if he had any, you

know, corrections, or editorials, whatever, but he did not

write the book. Mr. Risen wrote the book.

MR. KLAYMAN: That's -- I'm sorry, Your Honor.

THE COURT: So for example --

MS. HANDMAN: And that is Mr. Risen's testimony.

THE COURT: So this e-mail represents, or I should

say, references a thumb drive with 20,000 pages of documents.

Now, whether or not it was written on the fly or

not, whether or not it was 8,000, or 14,000, or 27,000, right


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now my question is, do you have that thumb drive?

MS. HANDMAN: No, we do not and neither does Mr.

Risen.

THE COURT: Where is the thumb drive?

MS. HANDMAN: Mr. Lichtblau doesn't know where it

is.

THE COURT: So Mr. Lichtblau doesn't --

MS. HANDMAN: They're not with Mr. Risen.

THE COURT: Mr. Lichtblau doesn't know and Mr.

Risen doesn't know and --

MS. HANDMAN: Mr. Risen never had it. He doesn't

believe he ever had the thumb drive.

THE COURT: Well, regardless of whether he had it

or didn't have the thumb drive, he might have some idea of

where it is.

MS. HANDMAN: He doesn't.

THE COURT: So Mr. Lichtblau doesn't know where

the thumb drive is. Mr. Risen doesn't know where the thumb

drive is. You and your legal team doesn't know where the thumb

drive is, correct?


We've never had it and Mr. Risen has never had it,

according to his testimony. And Mr. Lichtblau had it at one

point, but he doesn't. As I said, the testimony of Mr. Risen

is that Mr. Lichtblau downloaded the documents that he thought


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were relevant.

THE COURT: Okay. So in this situation you're

claiming the Defendant, Mr. Risen and his counsel, have said

unequivocally on the record to a Federal Magistrate Judge, we

have turned over all the documents.

So I have to accept that at face value, just like

I accepted at face value your statements of certain categories

that you turned over all the documents.

If it turns out that Miss Handman is incorrect and

that all the documents have been turned over, believe me you --

believe you me is the right phrase -- believe you me, there

will be plenty of other potential consequences that will arise

from that scenario, but right now I do not have any alternative

but to accept the representation at face value.

Apparently a significant number of these documents

on the thumb drive were not classified, or confidential, or

attorney/client work product, but instead were simply copies of

documents filed in various courts. So they are public

documents, but whether they were public or attorney/client, or

work product or not, the Defense says you have them all.

MR. KLAYMAN: Your Honor, the problem with that is

that the recitation of Mr. Risen's testimony that she just gave

was false. Mr. Risen did not testify that he didn't have the

thumb drive.

THE COURT: What did he say?


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MR. KLAYMAN: I didn't get that far because I got

cut off from the questioning. So I will submit to you the

transcript of that and show you what was said and just now was

not the case.

And what I would ask this Court to order is that

they do turn -- they be ordered to turn over the thumb drive,

just like Mr. Montgomery is being ordered to turn over the

software. Same thing. Turn it over and let them come back and

justify what was said because I was cut off at deposition with

speaking objections and trying to coach the witness into not

answering the question.

THE COURT: Well, the order requiring Mr.

Montgomery to turn over the software is because Mr. Montgomery

was in possession of the software. And counsel has indicated

to me that Mr. Risen has never been in possession of the thumb

drive. So it is a little bit of a different situation and it

is not quite analogous.

MR. KLAYMAN: Could I have an order, then, that he

is ordered to answer the question as to whether he has ever

been in possession of the thumb drive and where it is because I

couldn't get to that at the deposition. What she just

testified to she just made up.

THE COURT: So I am a little bit curious about

that because, Mr. Klayman, you do not strike me as a shrieking

violent guy.


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MR. KLAYMAN: I'm not.

THE COURT: So if you are at a deposition and you

are trying to find out from Mr. Risen if he ever had the thumb

drive -- and I was not there.

So I don't know if Miss Handman was being

obstreperous or not. I don't know if she was coaching or not,

but the point is, even if she was, I cannot believe that an

attorney with your level of experience would simply move on and

not followup with the specific question.

MR. KLAYMAN: I moved on with the witness request

and I don't see where it came out.

THE COURT: All right. So here is what we are

going to do because I just do not have time to review an entire

deposition transcript. And the summation is going to be one

which will not require a significant amount of effort by

anyone.

So Miss Handman, by next Friday, you will submit

either an affidavit or a declaration from Mr. Risen stating,

unequivocally, one way or the other, whether he was ever in

possession of the thumb drive mentioned in Mr. Lichtblau's

e-mail. And regardless of whether he was ever in possession of

it, if he knows the current location.

MR. KLAYMAN: And we were joking about Hillary

Clinton before, but it sounds similar, doesn't it?

THE COURT: I really cannot respond to that sort


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of comment. So I am going to refrain.

MR. KLAYMAN: Sometimes two and two equals four.

THE COURT: Do you have any other issues to raise

for me, Mr. Klayman, that you have noticed for today?

MR. KLAYMAN: No, this is it, Your Honor.

THE COURT: All right. So bear with me just a

minute.

By the way, what is the status? Because I have

not checked the entire docket sheet. What is the status on the

motion to stay? Was there ever a ruling on that?

MS. HANDMAN: No, there was not, Your Honor.

THE COURT: Was there ever a ruling or not yet a

ruling on a Motion to Dismiss?


MR. KLAYMAN: No.

MS. HANDMAN: The motion to transfer, correct.

THE COURT: All right. Folks, so thanks for your

participation today. I think everyone has taken pretty good

notes on the rulings, but in any event, I am going to be

issuing -- folks, sit down, please, and make yourselves

comfortable. Especially it's a Friday afternoon at 5:45. So

you do not need to stand up.

My point was probably by Monday we will issue a

written administrative order just summarizing the ruling. So

you will have it on the record and it will be uploaded on


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CM/CEF.

Normally in a discovery dispute, I follow the

dictates of Rule 37, which requires an award of attorney's fees

to the prevailing party, unless the losing party has provided

substantial justification for its position, or other

circumstances making an award unjust.

The rule also says that if there are rulings that

go both ways, you can basically either subtract, or add, or

equal it out to be a draw. So in this particular case, each

side won some, you lost some, and basically, it's a draw.

So I am not going to be awarding attorney's fees

to either side. I am sort of tempted to suggest to you all to

try to relax a little bit and keep the level of vitriol down,

but I don't know if that is really going to do that much good.

I have a couple of cases other than this one that

are pretty hotly contested. And I made that request on a

number of occasions and it has done absolutely no good

whatsoever.

So I am sure you folks will continue litigating at

whatever level of passion and energy that you have been

preceding under ever since the lawsuit was filed.

All right. Folks, anything else from either side

today concerning this discovery, series of disputes?

MR. KLAYMAN: Only that we wish you well with your

operation, Your Honor.


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THE COURT: Thank you. I appreciate that so much.

MR. KLAYMAN: I didn't bring my dog today.

THE COURT: Hopefully I will be back on my feet

here on the bench dispensing justice sooner, rather than later.

So safe travels back to New York and safe travels

back to Brickell.

(Thereupon, the proceedings concluded.)


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CERTIFICATE

I hereby certify that the foregoing transcript is

an accurate transcript of the audio recorded proceedings in the

above-entitled matter.

08/24/15 Bonnie Joy Lewis,

Registered Professional Reporter CASE LAW REPORTING, INC. 7001 Southwest 13 Street,Pembroke Pines, Florida 33023 954-985-8875


montgomery v risen # 110 aug 21 transcript as attached ecf 111-1

Documents