Sei sulla pagina 1di 30

IN THE COURTOF APPEALOF THE STATEOF CALIFORNIA FIRSTAPPELLATEDISTRICTIDIVISION ONE]

DANIELL. BALSAM,

Plaintiff,Respondent,andCross-Appellant.

TRANCOSINC.era/,

Defendants,Appellants.andCross-Respondents.

CASENOs.4128485and A129458 (SuperiorCourt No. CIV471797)

Appealfrom the SuperiorCourtof the Stateof California. Courrtyof SanMateo,No.CIV471797 Thel{onorableMarieS.Weiner,Judge

CROSS.APPELLANT'S RBPLYTO CROSS-RESPONDENT'S

OPPOSITIONTO CROSS-APPELLANT'SOPENNG BRIEF

TimothyJ.Walton(StateBarNo.184292)

LAW OFFICESOFTIMOTHYWALTON

9515SoquelDrive.Suite207

Aptos.CA95003

Phone (831) 685-9800,Fax: (650) 618-8687

AttorneysforRespondentandCross-AppellantDanielL. Balsam

TABLEOFCONTENTS

TAI}LEOFCONTENTS

TAIILE OF AUTHORITIES

CROSS-APPELLANT BALS,\NI'SREPLYTO CROSS.DEFENDANT TRANCOSINC.'S OPPOSITION TO BALSANT'SOPENINGBRIEF

I.

lntrt-rduetion

ll.

Discusston

A. TrancosHadNo Affimative Defensesasto the CLRA Causeof Action.

B. TheLanguageof theCLRA is Unambiguous. andit GoesAgainstTrancos

C. BalsamHasStandingto BringaClLRACause of Action

D. TheSpamsViolatedtheCLRA in Multipie Wa,vs

E. An Injr-rnctionis Necessaryto Ensurethat DefendantsDo Not ResumeTheirUnlau'fLr1 Practices

III.

ThisCourtShouldHoldllrianNelsonJointll/

SeverallyLiableontheJudgment

IV.

NoteRegardingTrancos'Objectronsto Balsam's

PageCitationsandReferr:nces

,

Page

ii

"""""""""'iii

""

1

"' -)

" """"-l

'

,

'o

ll

.18

r 1

l0

CnOSS-AppELLANT!SREPLYT'OCROSS-RESpONnE\T'SOppOStrtoNTO

CROSS.APPEI-LANT'SOPENINGBRMT'

TABLE OF AUTHORITIES

CaliforniaCases

Aron t'

(-l'Hctul Compant'ofCali.fbntta-

143Cal.App. -lth 196Qd Dist.l0L)6) Berrt't,.AmericanE.rpressPubii'shing,Ittc'. l41Cal.App. 1th224 (4thDist.2007)

ConstrmerAtlt'ocatest'.EchostarSctelliteCorp

'.

i13Cal.App.-lth 1351(ldDist.2003) '

Daugltertt'v. Anteric'anHontla Motor Co.-

l-1.1Cal.App."lth82-l (2dDist.2006)

Fairbank.s t'.SnPerior Court.

-16 Cal. 'lth 56 (2009)

Ht'pertouchInc t,. ValueClickInc. et ul. 192Cal.App.4th 805 (2,J Dist.l0l1) Kle.iJmant'. Vona,qeHoltlin,qs (lorP. 49 Cal.4th 33-l (2010)

M.7

T'hornet'.Honcut Dretlgin,qCompat*'. .13 Cal.App. 2d 131 (3dDist' 1941)

Met'er v. Sprint SpectrumLLP.

-15 Cal.

.lth 63.1 (2009)

.

-

i\,lel.soilr'.PearsonFord Co

186Cal.App.4th983t-lrhDist.2010)

Pectple v. Conu.'ct)',

12 CaLApp.3d875 (2dDist.197't)

Peoplev. Paci,ticktndrnark LLC. 129Cal.App. -lth 1203 (.ld Dist.2005) Povt'ersr'.Pottery Bant lrtc'

,

111Cal.App. -lth 1039 (,lthDist.ltl09)

Sc'hnuert'.ManclarinGernsoJ'Cctl.,Int'-.

125Cal.App.4th9zt9(.lthDist.2005)

Sevitlolr'.TorgetCorp 189Cal.App.4th905 (-lrh Dist 1010) SteroiclProtlttctHormorteCuse.s. 181Cal.App.4th1'15 (2rlDist.1010) W\,(tttt'. LinionMortg0geCo,etal.

21Cal.3d'713 (1919)

iii

Page

""""" 8

'

"

""'

-5

"11

""

"""

1-l

-5

"

"'1ttt'ssitrr

pas'\tt/1

""

19

1tcts.sitrr

.

.

,

l1

10

'.6.1

.'

.

.1

I1

CnOSS-AppELLANT'S REPLYTOCROSS-RnSpOxoENT'SOppOSrutoNTO

CROSS.APPEI,LANT'S OPBXTXCBNITP

TABLE OF AUTHORITIES (cont. r

FederalCases ,A.rtrturt:jatot'.eMachines Inc "102 F.Supp2d 1133 (CD'Cal'2005)

DoeI t'.AOL LLC. No C 06-5866SBA.2010U.S.Dist'LEXIS68859

(N.D.Cai.June22.2010t.".'

FederalTratleCommission t''A./l'ordttbLeMediaLLC. i79F.3d1228 (9rh Cir.1999) Frientl,so.f'theEarthIrtc.v'.LaitllawEnt'ironrnentalSen'ice.s (TOC) Irtc., 528U.S.16t (1999) Kle.fftnant'.Vona,q,eHoldingsCorp No.CV 07-2,J06GAF (J\,\'Jx).2007U.S.Dist.LEXIS -10487(C.D.Cal.May13.2007) (order srantinq motiontoclismiss) Kov'alskt'v.Hev'lett-PackartlComparn',

2011U.S.Di

st.LEXIS:11337 (N.D Cal.Apr.15.

2011)

l,lor,:lbergt'. TriLegictntCorp. et oL.

.145 F.Supp.2d1082 (N.D.Cal.2006t

ttnitetl States t'. Concentraretl Phosphate E.rport Associctticttt,

393U.S.199

LtniretlStatesv. Kilbritle.

58;tF.3cl12-10 (gthCir.1009)

(,lnitetl State.rv. Oregon StateMetlical Socien'.

3;13U.S.326 (1952)

VonGrobev. SprintPCS. 312F. Supp.2d 1285 (S.D. Cal.2003)

California Statutes.Rulesof Court. and RelatedDocuments

Bus.& Prof.Code $

Bus.& Prof.Code$ 17500(FalseAdvertisin,sLaw)

Bus.& Prof.Code$$ 17529.11529.5

Bus.&

Civ.Code $ 1750etseq. (ConsumersLegalRemediesAct).

.'

17200 (UnfarrCornpetitionLau')

Prof.Code $ 17538.5

CodeCiv,Proc.S -173

lv

Page

' 10'1l

""""""

'.'.'

v

19

.l0

"' 6. 13

1.')

 

'.'

'.+

 

.

.

.

1 9

 

1l

19

7

 

,

 

.8. 1t)

 

10

 

'

'7ta'ssitrt

 

16.17

 

,

Pos'stttt

ll

Cnoss.ApPELLANT'SREPLYTOCROSS.RTSPOXOENT'SOPPOSITIONTO

CROSS.APPELLANT'SOPENINGBNTNN

Page

California Statutes.Rulesof Clourt.and RelatedDocuments (cont. )

Corp.Code$$17101.17158

Proposition6.tr (200.1)

10.21

8

RuleofCourt8.216(b)(2i

1

FederalStatutes 15U.S.C. $ 7701etseq. (CAN-SPAM Act) 18U.S.C. $ 1037(aX2)and (dX4)(CAN-SPAM Act)

,

pa.ssim

i2

Other Authorities JamesS. Reed.LegisLatingFor'f,he Consurner:Artlrtsitler'.s Analysi.so.t''theConsurner.sLegal RemetliesAc't.2

PacrprcL.J.i (l9l l)

Cnoss-AppELLANT'sRnplvro CRoss-RnspoxnENT'sOpposrrroNTo

CROSS.APPELI,ANT'SOPENINGBRTEN

CASENOs.Al2E485andA129458

DANIELL.BALSAN,I.

Plaintiff.Respondent.andCross-Appellant

TRANCOS lNC. era/.

Defendants.Appellants.andCross-Respondents

CROSS.APPELLANTBALSAM'S REPLY TO CROSS. RUSPONDENTTRANCOSINC.'SOPPOSITIONTO BALSI\NI'S OPI,NING BRIEF

On Appealfrom Ordersof theSuperiorCourtof theStateof Califbrnia. Countyof SanMateo.No.CIV-171797 TheHonorableMarieS.Weiner.Judge

I. INTRODUCTION

PlaintiffandCross-AppellantDanielL. Baisam ("Balsarn")debated

whetherto file thisReplyBrief.trecausenothingin DefendantandCross-

RespondentTrancosInc.'s ("Trancos" ) OppositionunderminesBalsam's

OpeningBrief. Nevertheless.rnanabundanceof caution.andto address

Trancos'knowingmrsstatementsof factsandlaw.Balsamchoseto file thrs

briefReply.

As apreliminarymatter.TrancosobjectsthatBalsamdidnotinclude

a statementof factsfor his Cross-Appealand (supposediy) mistakenl,v-

CnOss-ApPELLANT'SREPLYTOCROSS.RgSPONOENT'SOPPOSTTTONTO

CROSS.APPELI,ANT'SOPTNNCBNITT

relieson theStatementof factssettorthin hisOpposition.Trancosis

incorrectasa matterof law, CaliforniaRuleof Court8.216(bttll

specificaliystatesthat "A

summaryof thesignificantfacts,"Thatis exactlywhatBalsamdid.sothe

tormof Balsam'scombinedOpposition/Opening Brief\\'asproper.

mayinciudea single

-fhe CLRA grantsstandingtoconsumersto suefor varioitstvpesof

misleadingadvertising.Undertheplainlanguageof thestatute.the

definitionof consumeris norlimitedto peoplewho actualiypurchasethe

(allege<ily)falselyadvertisedgoodsandservices - thedefinitiononly

distinguishesconsumerstrombusinesses.In fact.theCLRA e.rpresslv

appliesto transacttonsintenclerito resultin thesaleor ieaseof -eoods and

serl'ices,TheCaliforniaSupremeCourtrecentlyheldthata consumermust

havesuffeledrznr,damagesto havestanding,andspecificzrill'statedthat

ail,r'damagesis broaderthanpecuniarydamages.TheCalifornia

Legislatureconlirmedthatrecipientsof spam - not justunlar'vfulsparn -

sufferdama-ges.Theretore.Balsarnhasstandingto sueTrancosfor

violationsof theCLRA becauseBalsamwasdamagedw'henhereceiled

spamssentby Trancos.el'enwititoutpurchasingthesoods/services

advertisedin thespams.It reallf is thatsimpie.

Moreover.Balsamdoesnotevenseekmonetarvreliefurtderthe

CLRA.onlyaninjunction[oensurethatTrancosdoesnotreturnto its

uniawtulpracticesin thefuture. Tranctrs'utterfailureto concedethiiteren

a sin-elethingit didwasmisleading.andthevehemencew'ithr.lhichit

opposesBalsarn'sCLRA claimrequestinganinjunction.sLr-qgeststhatit is

highlylikely thatTrancosw'il/returnto unlarvfulspammin-e.assoonasit

canI'igureouthow to do soprofitably(andwithout -setting caughtagainl,

It is quitetellingthatTrancosopposesaninjunctionthatllould onir'

Cnoss-AppELLANT'sRpprvro CRoss-RespoNnENT'sOpposlrtoNTo

CROSS.APPELLANT'SOPE\INGBNMT

preventit trom engagingin unlawfuladvertising -

thepublicinterestfar morethanit benefitsBalsampersonally.

aninjunctionthatsen'es

BrianNelson ("Nelson").Trancos'ChiefExecutiveOfficer.testified

thathewaspersonallyinvolvedtnTrancos'unlawfulactions.Thefactthat

hedid soin hrsroleasa corporateotficerof Trancosdoesnotrelievehim

of personalliability. Corporateofficersmaynotbeiiablefor their

companies'wrongfulactsmerelybecausetheyarecorporateofficers.br-rt

theyareliablefor theiro)r:/?wrongfulacts.Balsamdoesnot seek

additionalremediesagainstNelson.butratheronly seeksto hoidhirn

jointlyandseverallyliablealongwithTrancosInc.

ThisCourtshouldruiein Balsam'sfavoron theCLRA causeof

action.andholdBrianNelsonpersonallyliableon the judgmentfor hisown

unlawfulactions.

u. p_ISCUSSION

A. TrancosHad No Affirmatile Def'ensesasto the CLRA Causeot' Action

It cannotbedisputedthatTrancos'FirstAmendedAnswerhadti,''o

affirmativedefenses.bothof whichwereexpresslytar-qetedto the.lir.sr

causeof actionfor violationsof Il&P Code $ I7519.*5.Appeilant's

Appendix ("AA") l:88-89.Defendantsneverhadanatfinnatir''edefenseto

thesecondcauseof actionfor vroiationsof theCLRA - i.e

wasnota conslrmer.thatBalsamwasnotdamaged,or eventhatthespams

didnotviolatetheCLRA.

thatBalsarn

As such.Trancos'entiredefenseto theCLRA causeof actionrr,as

improper.notwithstandingits "law of thecase'argumentin rtsOpposition

ar35-37.

CnOSS.APPELLANT'SREPLYTOCROSS.RNSPONNENT'SOPPOSITIONTO

CROSS.APPELLANT'SOPTXNCBNTET

$,. TheLanzuageof theCLRA isUnambiguous.andIt GoesAgainst Trancos

BalsamagreeswithTrancos'statementsthatthelanguageof the

CLR.Aisunambiguous.andBalsamagreeswrththelegalstandard -

courtonly needsto lookat thelegislativehistoryif thelan-uua-ueis

ambiguous.Oppositionat34-35.39.

thata

1. Seeksor AcsuiresanYGoodsor Services:Intended

Horvever,thelanguageof theCLRA is unambiguousirlBaLsortt's

fat,or. TheCLRA defines "consumer" as "an individualwho seeksor

acquires.by purchaseor lease,rrn.t'goodsor servicestor personal.family.

orhouseholdpurposes"'Civ'Code$ 1761(d) (emphasisaddedl' 'francos

isthepartywhorefusesto accepttheplainlanguageof thestatute -

torewriteit to replace "seeks oracquires"with "seeks and acqutes" (i'e

imposingapurchaserequirement),andtoreplace "rlrtr'-eoods or services"

with "the .spec'ificgooclsor servicesallegedlyfalsel,vadvertised."Nothing

in Trancos'OppositionrelatedtctiVortlltergt'.TrilegiantCttrpororiort.ll5

F.SLrpp.2d 1082 (N.D. CaI.2006)ch:rngesthefactthat "seeks or acquires"

isciisjunctive.sosatisfyingeitherpart of thestatutoryianguageis sufficient

to meetthedefinitionof "consumer."

trying

Moreover.theprohibitionssetforthin theCLRA expresslyapplvto

ffansactions.suchasadvertisements.thatare "intentled to resultor which

resultin thesaleor leaseof goodsor services."Civ.Code$ 1770(a)

(emphasisadded).Theinclusionof thephrase "intended to result"is

fundamentailyincompatiblelvithapr-rchaserequtrement.Yet.Trancos

ignoresthe "intended to result"phrasealtogether.attemptingroforcea

reliancerequirementintothestatutethatsimplydoesn'texist.

CnOSS.APPELLANT'SREPLYTOCROSS.RTSPOXOENT'SOPPOSTTIONTO

CROSS.APPELLANT'SOPENINGBNTNN

2. Suffers anyDamage

Finally. "Any consumerwho suffersd/?r:damage"maybringa

CLRA causeof action.Civ.CodeS 1780(a) (emphasis added).Trancos

wouldrewritethestatutetorequiremonetarydamages.i.e

requirement.with no basisfor doin_eso. Trancosignoresthefactthatthe

CaliforniaLegislaturetoundanddeciaredthatthereceiprof spamcauses

damages.B&P Code $ 17529(d). (e),(g),(h). evenif therecipientdoesnot

purchasethegoodsor servicesadvertisedin thespam.

a purchase

3. Legislatinefor the ConsumerResolvesc

Trancosboldlyclaimsin a conciusorymannerthatthestatutorl'

languageis unambi-cluous - in its favor - bututterlyfailsto provideanl

analysisto supportthatclaim. Oppositionat34-35.In contrast.Balsam's

OpeningBriefandthisRepiylookattheplainlanguageof thestatuteund

applyit to thernstantfacts.Balsamalsomaintainsthatthelansuaseis

unambiguous.butsincethePartiesarenowarguingaboutthelanguage.it

appearsthatTrancosis attemptingto manufacturesomearnbiguitl,'.

Forthatreason.andto theextentthatthisCourtmightfind an-'-

ambiguityin thelanguage.Balsarnproperl;'referstoJamesS.Reed.

Legi.slatingFor TheCon,stuner:,\n In.sitler '.r'Analr'.ri.r o.ftheCottsunter.s

LesalRemetliesAct.2PectrtcL.J.I (1911),whichcourtshave

acknowledgedis anauthoritativesourceasto thelegislatrveintentbehind

. theCLRA. Seee.g.Fairbctnksr, SuperiorCourt. -16 Cal. -lth 56.61

(2009t: Bern't'.ArnericctnE.rpre,ssPubli.slting,Irtc

130r

LegislatingFor TheCons'umernotesat x8 thattheCLRA mustbe

liberallyinterpretedto protectconsumers.andif thereis anvdoubtrnthe

interpretationor application,courtsmustdecideln consttnters' .fat'or.

-lth 32-1.

CnOSS.ApPELLANT'SREPLYTOCROSS.RPSPONNENT'SOPPOSITTONTO

CROSS.APPELI-ANT'SOPENtriGBNTET

LegislatingFor TheCons'umeralsonotesthattheLegisiature

expresslyrejecteda tiaudrequirement.because "all thedifficultiesin

provingcorrunonlaw fraud fwould havelcorrespondinglydiminishedthe

utriityof thestatute."Id. at x12. Er-eo.sincetheLe-sislaturerejecteda

fraudrequirement.TrancoscanxotevadeliabilityundertheCLRA merelt'

becauseBalsamdid notpurchaseanyof thegoodsor servicesfalsely

advertised.

C. BalsamHas Standineto Brins a CLRA Causeof Action

As discussedimmediatelyabove.theCLRA isdesignedto protect

consumers, be.foretheyareinjuredby purchasingfalsely-advertisedgoods

andservices.Balsamls a consumer.pursuantto thepiainlanguageof the

definition.becauseheseeksor acquiresgoodsandserr,'icesin general.even

if

hedidnotacquirethegoodsandservicesTrancosadvertised.Cir'.Code

N

1761(d).becauseTrancosintendetlthattheemailsit sentto Baisamresult

rnthesaieof goodsandservices.Civ.Code $ 1770(a).

L

Trancos' Citation to Kleffman is MeritlessBecauseKleffman M isin terpr eted Schaue!

As

discussedin moredetailin Balsam'sOpeningBrief.Trancos'

relianceonKle.ffinant'.VonageLloLdingsCorp

(JWJx),2007U.S.Dist.LEXIS10487at *11 (C.D. Cal.May23.1007)

(ordergrantingmotionto dismiss),anunpublisheddecisionnotonpoirlt.

for thepremisethata spamrecipientwhodoesnot purchasean)'thingr,ia a

spamdoesnothavestandingundertheCLRA, is misplacedbecause

Kle.'fJinancameto its holdingby misinterpretingScftauer\'.tVantlarinGern.s

of Cal,,Inc

Nothingin Trancos'Oppositionat38addressesthefactthatthe

SchauercourtheldthatSchauerdid nothavestandingundertheCLRA

No.CV 07-2406GAF

125Cal.App.

-lth 9.t9.960 (.lthDist.2005t.

CnOSS-AppELLANT'S REpLyTOCROSS-RnSpONoENT'SOppOStuOxrO CROSS-APPELLANT'SOPBNNCBRME

becausetheatlyertisementw'asnotdirectetlat her.butratheratherfiance.

Similarly.in 2010.Set'idalv'.TargerCorp.reinJorcedthedistinctionthat

theKtqlfnuTr?courtmissed.andthatTrancosrelieson.rvhenit heldthat

conslrmerscouldnotbringa CLRA causeof actionnotbecausethey$'ere

notirrjured - theyweretnjured - butratherbecausetheydid notre€the

falselabels.189Cal.App.

OppositiontgnoresSetlit,ul,andfailsto addressthedistinctionthatSchauer

wasnot therecipientof thefalseadvertisingmessages.but Kleffmanand

.lth 905.929 (:lthDist.l0l0). Trancos'

Balsamwere.

Trancos'aciditionalcitationto VonGrrtltev.Spritt PC5.311F.

Supp.2d1285,1303 (S.D. Cal.1003)in itsOppositionat38addsnothing

to itsclefense.asVonGrabemerelyrepeatsthestatutorydefinitionof

"consumer."

2. TrancosOffersl,lo Arsument to ContradictLeeislati','e Findingsthat BalsamwqsDamasedbv ReceivinqTrancos' Soam. "Anv Damaqes"GivesBalsamStanding

Theonlyremainingquestionasto standingis whetherBalsamwas

clamaged.TrancosmelodramaticallyciaimsthatMet'et'r'.SprintSpec'trum

LLP,45Cal

claim. Oppositionat41. Quite thecontrarv.Met'erarosefroma

{th634

(2009) "sounds thedeathknell"for Baisarri'sCLRA

"preemptive" complaintin whichno oneallegedthctts/heltatlbeen

tloma,qed.All thattheMet,eropiniondid wasrejectsuchpreemptive

lawsuits,holdingthata CLRA plaintiffmusthavesufferedartl damagesto

havestandrng.Meler aisoheid.rna SectionthatTrancosomitsr,l'hener,'erit

cananclneveranaiyzes -

damases.Id. at 6r+0-,11.

thatanl damagesis broaderthanpecuniary'

Cnoss.ApPELLANT'SREPLYTOCROSS.RTSPOIVOENT'SOPPOSITTONTO

CROSS.APPELI,ANT'SOPBNTXCBNMT

Met'eris consistentwith ,4ronv. U-HaulComparnoJCuliJontict,.

whichheldthatProposrtion64 addeda "lost moneyor propert\'"

requirementfor standin-qunderB&P Code $ 17200,butrrotfor standins

undertheCLRA. whichstillrequiredarn'damages.l-13Cal.App. -lth 796.

802 (2dDist.1006).

Thisis wherethel'rial Courterredasa matterof factandof iau'.

TheTriai Courterredasa matterof .t'act whenrt statedthatBalsam

sufferedno damagesby receivingDefendants'spamandthattherecanbe

nodamageswithoutapurchase.Reporter'sTranscript ("RT" ) 70:I2-8'l:I I .

344:2-9.TheCaliforniaLegislat.urefoundthatthereceiptof spamcauses

billionsof dollarsof damagesto Californianseachvear,B&P Code

5 17529(d).andthatwasin 2003. (Damageshaveincreasedsincethen.as

thepercentageof emailthatis spam.andtheabsoluteamountof'spam.

haveincreased.)Thereceiptof spamcausesdamages just likethereceipt

of junk faxes. junk mail sentpostage-due.andtelemarketrngcallsto a pay-

per-minutecellularphone.B&P Code $ 17529(e). (-st. th). Nothrngin

Trancos'Oppositionevenattemptstoopposethisindisputablepoint

Trancosmerelvrepeatedlvasserts.withnobasisin factor iaw.thatBalsan.r

\\asnotdamagedby reeeivingitsspams.rTheTrialCtrurtshouldhirrc

appliedLegislativefindings (as to thedamagescausedby spamtfromB&P

Codet 17529to theCLRA. for theCLRA

' To addressTrancos'pointin itsOppositionat -l;1 thatBalsamcitescases in whichtleceptiveUCEis negativelydiscussed.Balsampointsoutthatthe Legislativefindingsasto thedarlagescausedby spamsispartof B&P Code $ 17529 - referringto spamin getteral * andnotpartof $ l7 529.5 thatspecificailyprohibitsfalseanddeceptirespamming.In otherwords. a// spamcausesdamages:deceptivespamisa subsetol all spam.

CnOSS.AppELLANT'SRnply TOCROSS.RTSpOxoENT'SOppOStrtONTO CROSS-APPELI,ANT'SOPNTNCBNNT

shallbeliberaliyconstruedandappliedto promoteits underlyingpurposes,whichareto protectconsumersagalnst unfairanddeceptivebusinesspracticesandto provide efficientandeconomical procedures to securesuch protection.

Crv,Code $ 1760.

And theTrial Courterredasa matterof law whenit statedthatfor

CLRA standing, "You haveto havearesultingmonetarydamage."RT

78:7-8.TheTrialCourtmisinterpretedtheplainlangua-eeof Met'er.as

shou,nby itsfaciallyincorrectcitationto Met'erfor thepremrsethat

"Plaintiff musthavesustainedSomemonett^' implic'tttioncausedby the

defendant'sviolationof thelaw

tnMet'erstatedexactlytheopposite:thataCLRA piaintiffdoesnolhaveto

showmonetarydamages.butratheranl damages.whicharebroaderthan

actut.tldamages./ri.

TrancosblatantlymisquotesBalsarnin itsOppositionat+3-i-l rlhen

." AA I:210n.1. TheSupremeCourt

it claimsthatBalsamstatesthatSteroidHormoneProdLrctCrt.re.r.181Cal,

App. -lth 1.+5 (2d Dist.2010)doesnotrequiredama-ees.Balsamsaid

nothingof thesort.Rather.BalsamsaidthatSteroitlHonnoneProduct

CasesfollowedMet'erwhenit heldthata CLRA actiondoesnotrequire

ac'tual (monetary)damages.Itl.at 156.

AndTrancosw'illfullymissesthepointof Balsarn'scitationto Doel

t'.AOLLLC,No.C 06-5866SBA.2010U.S.Dist.LEXIS68859at xl0-11

(N.D.Cal.June22.201,0).Thepointof thecitationisthata personcanbe

damaged.tbr purposesof CLRA standing.withoutspendingmone\outot

oocket.

CnOSS.AppELLANT'SRnpry TOCROSS-ReSpONoENT'SOppOStrtONTO CROSS.APPELLANT'SOPENINGBRTgT'

3.

Thereis No PreemptionDefenseto Balsam's Cross-Appeal

In its Oppositionat -14-.15, Trancosslidesintoanirrelevant

discussionaboutpreemption.butthisis a redherring.By itso'uvnplain

language.theCAN-SPAM Actnev'erpreemptstheCLRA.becausethe

CLRAisnotspecifictoemail.seeI5 u's'c' $ 7707(b)(l)(A) ("

Act shallnotbeconstruedto preempttheappitcability'of - (A) Statelari's

thatarenotspecifictoelectronit'mail.inclurdingStatetrespass.contract.or

This

tortlaw

.") (emphasisadded).SeealsoPov;erst'.Potter-t'BarnInc'.-Ill

Cal.App.

.lth 1039,1041 (4th Dist.2009):

CAN-SPAMdoesnotpreemptstatelawsthat "are not specifictoelectronicmail."(15U.S.C, 7707(b)/21.)Because Song-Beverly [] isnotin anymannerspecifictoe-marl,we concludeSong-Beverlyisnotpreemptedby CAN-SPAM.

LiketheSong-BeverlvAct.theCLRA isnotspecifictoemarlanddoesnot

evenmentionemail.Therefore.theCAN-SPAMAct doesnotandcarulot

preempttheCLRA. Trancosmayattemptto arguefederalpreemptionas

itsdefensein itsownappealon theBusiness& ProfessionsCode t 17519.5

causeof action.butthepreemptiondefensehasnoplacein Balsamscross-

appealfor theCLRA causeof action.

1. BalsamDoesl,lot Nee DoesNot SeekMonetarvRelief [Jnderthe CLRA

Finally.asdiscussedin detailin Balsam'sOpeningBrief.

Annttn:iatov'.eMachinesInc. - discussinetheCLRA andB&P Code

$$ 17200and1500 - heldthat

thereis a le-sitimatebasisforrequirinsrelianceandcausation vr,heretheplaintiff:;eeksmonetar)'benefit.Thesameneed doesnotexistwhentheprincipalbenefitof statutory enforcement.evenwhenundertakenby a singleindiridual non-classrepresentativeplaintiff.isprotectionof thepLrblic.

10

Cnoss-AppELLANT'sREpLyro CRoss-RnspoNoENT'sOpposlrtoNTo

CROSS.APPELT,ANT'SOPENINGBNTCT.

-102 Ir.Supp.2d 1133.1137(C.D. Cal.2005).As Baisamhasmadeclear.

heis not seekinga monetarybenefitundertheCLRA. oniy aninjunctionto

ensurethatTrancosdoesnotharmthepublicat largeby returningto its

trnlarvfulpracticesin thefuture.

iVloreover.becausetheCLRA usesareasonablepersonstandard.

ConsunterAtlvoc'cttesv.EchostarSatelliteCorp

I l3 Cal.App. -lth 1351.

1360 (2d Dist.2003).Balsamdoesnotneedto proveor evenalle-uethathe

wasrnisled.onlythata reasonablepersonmightbemisled.

Amazingly. TrcutcosaccusesBalsctmof disregardingthestatutorv

laneuageof theCLRA. Oppositionat50. Balsamdoesnothingof thesort:

Balsamnotesthatthestatutorylanguageof Civil Code $ 1780statesthat

"An)' consumerwho suff'ersanydamage"astheresultof actsprohibitedbv

$ 1770hasstandingtobringa CLRA causeof action.As above.Balsam

sr-rftereddamageby receivingspamssentbyTrancos.SeeB&P Code

$ 17529(d). (e).(g),(h). Tranco,;isthepartydisregardingtheplain

language,by attemptingto forceapurchase/reliancerequirementintothe

statutew'henno suchrequirementexists.e\IenthoughLegi.sLutinqFor Tlte

ConsumerreportsthattheLegislaturespeciticallyrejecteda common-la''i

traud(i.e

C. The SpamsViolatedthe CLRA in Multiple Wavs

reliance)requirement.

1. Civil Codefi 1770(at(2)

Civil Code{ 1770(aX2)prohibitsmi;representingthesourceof

goodsandservices.

Trancosprivatelyregistereditsdomainnames.deliberatelyfailedto

registeritsfictitiousbusinessnanleUSAProductsOnline (even thoughrt

kneu'it hadto registerFBNsandlrctt'toregisterFBNs).RA 9-10.RT

-148:16-20.-150:16-21.-15-l:11-15. andclaimeditsaddresstobeaboxata

1l

Cnoss-AppELLANT'sREPLyro CRoss-Rrspoi',{IENT'sOppostrtoNTo

CROSS.APPELI-ANT'SOPEXTNCBNTPE

branchof TheUPSStore (and registeringfor thatbox usinganunregistered

fictitrousbusinessnamein violationof TheUPSStore'scontractandU.S.

PostalForm1563),AA 1:213-20.AA 3:,136-87.RT 222.16-223.21.Thus.

Trancosmisrepresentedthetruesourceof thespams.

TheTrial Courtalreadynradefindin,esof factthatTrancostook

stepsto ensurethatthepubliccouldnotidentifllit.

Defendantprivatelyre-qistersrtsdomainnamesanduses DomainsBv Proxi,'sothatreferenceto that fWhois queries] by membersof thepublicrvouldnotrevealthetrueownerof thedomainname.AA i:2ll-12.

DefendantTrancosintentionailyundertookeffortsto impaira [spam] recipient'sabilityto identify,locate.or respondto it astheinitiatorof theemail.andthatit intendedto hideitselt fromidentificationby recipientsasthesender.AA 1: ))9.

Trancosintentionallyandatfirmativeiyestablishedpractices andproceduresto avoidall humancontact.avoidtheability of membersof thepubiictocontactTrancosdirectlyto stop thesendingof emails"andavoidmembersof thepubliceren

knov'irtgwhoactuallysenttheemails

'\,\ 1:l3l-13.

And Balsamtestrfiedthattheprivateresisrratitrn.unregistered

fictitiousbusinessname.andclaimedaddressatTheUPSStoreactualiyr/iri

preventhim from identifyingTrancosasthesourceof thespams.RT 337.

TrancosrepeatedlyclaimsthatL/SAProductsOnline.comandits

otherdomainnameswere "validly registered."It simplyisn'ttrue.Private

registrationof lnternetdomainnamesusedfor spammingviolatesB&P

Code $ 17529.5(a)(2),becauseit misrepresentswhoownsthedomain

namesusedto sendthespams.Privateregistrationof lnternetdomain

namesusedfor spammingalsovrolatesthefederalCAN-SPAMAct. 18

U.S.C. $ 1037(aX4), (d)(2). SeealsoUniretlStcttest'.Kilbritle.58.+F.3d

1240.1259(9thCir.2009).AndDomainsBy ProxyInc.expressh'statesa

t2

Cnoss-AppELLANT'sREpLyro CRoss-RsspoNnENT'sOppostrtoNTo

CROSS.APPELI,ANT'SOPTNNC BRINT

policyprohibitingtheuseof its privateregistrationservicesfor spammin_e.

RT 94:5-96:15.RA 49-52.Forall thesereasons.Trancoscl,rdnot "r,'alidll'

register"anyof itsdomainnames.Thus.Trancos'claimin itsOpposition

at 11-48that "it

domziinname"is entrrelyfalse.It is ren'muchdi.spuretl.

is undisputedthattheheadercontaineda validl;"registered

TrancosagainattemptstomisleadthisCourtintobelievingthat

Balsam'sclaimis basedon fancifuldomainnames.Oppositionat -18--19. so

thatit canlook to KleJfmanfor le-ealsupport.However.thisis notthebasrs

of Balsam'sclaim. Rather.Balsam'sclaimisbasedonprivatere,qistrtttictrt.

notthe lanciful natureof thedornainnames.

Trancosalsoviolated $ l'710G)(2;becausesevenof theeightFrom

Names - PaidSurvey.Your Business.ChristianDating,Your Promotion.

BankWire TransferAvaiiable,DatingGeneric.andJoinElite -

misrepresentthesourceof thespams:who the1,iirereallvfrom. As the

frial Courtfound.theseFromNarnes

do not truly revealwho senttheemail. l'hus thesender information("from")ismisrepresented.All of theseemaiis camefromDefendantTrancos.butnoneof theemails disclosethisin theheader (or thebodyor theopt-out) The [] "senders" identitiedin theheadersof theotherseven emarlsdo notexistor areotherwisernisrepresented [],

AA l:231. Trancosdidnotdisputethisfactualfindingin itsOpposition.

norcouldit. tor BrianNelsoncouldn'tevenidentify'theadr,'ertisersbased

ontheFromNames.RT 302:26 -301.2.

As discussedabove.Balsamdoesnorneedto showreliance.because

thestatuteappliesto transacttonsinrendedto resultrnthesaleor leaseof

goodsor services.Civ.Code $ 1770(a),andusesa reasonableperson

standard.

13

Cnoss-AppELLANT'sREpLyro CRoss-RrsponpENT'sOppostrtoNro

CROSS.APPELI-ANT'SOPENINGBNTPT

2.

Civil Codefi 1770(a)(3)

Cil'il Code $ 1770(aX3)prohibitsmisrepresentingtheaffi|ation.

connection.or associationwith . or ceftificationby. another.

BrianNelsontestifiedattrialthatTrancosneversentunsoltcited

comrnercialemail.RT 259:17-18.302:4-6.buttheTnal Courtfolrndthat

thecontractbetweenHi-SpeedMediaandTrancoscontainednopromises

or representationsthattheownersof theemailaddressesthatHi-Speed

Mediaprovidedto Trancosever -qave directconsentor anyother

permissionto sendcommercialemails.AA I :221. RT '180: 11-'187:11.

lvloreover.Balsamtestifiedattrialthattheemaiiswereunsolicited.RT

325:9 -321 :4.391:24-25.394:3 - I0.

Defendantsalsomisrepresentedtheiratfiliation/connectionwith

DomainsBy ProxyInc.in violationof CivilCode| 1770(a)(3).Domains

By Proxypubliclysetsfortha policyprohibitingtheuseof itsprivate

registrationservicesfor domainllamesusedfbr spammine.RT 94.5-96:15.

RA 49-52.By usingDomainsBy Proxylnc.to privatelyreeistertheir

domainnames.DefendantsfalseLyrepresentedthattheyhadDomarnsBi'

Proxy'spermissionto useitsservicesfor spamming.And w'hen

contractingto useDomainsBy Proxy'sprivateregistrationserr,ices.

Trancosfailedto mentionthefactthatit rntendedto useDomarnsBy'

Proxy'sservicesfor spamming

Co:.141CaI.App. -lth 82-1.835 (2dDist.1006) ("althoughaciaimmay'be

statedundertheCLRA in termsconstitutingfraudulentomissions.to be

actionabletheomissionmustbecontraryto arepresentationactualll''made

SeeDaughertt,t'.,\trrcricartHctttdalvlotc,,r

by thedefendant.or on omi,ssiono;f'a.facttltede.fentlottt\'(t.\rtbligetlto

tlisclo.se") (emphasisadded).

t4

CnosS.APPELLANT'S REPLYTOCROSS.RTSPONNENT'SOPPOSTTTONTO CROSS-APPELLANT'SOPENINGBNM

Trancos'citedunpublishedfederalauthority.Kovralsld't',Hev'Lerr-

PackardCompont.2011U.S.Dist.LEXIS;11337at xi6 (N.D Cal.Apr.

15,2011),doesnothelpTrancos'position.for thesimplereasonthat Trancostlidhavereasonto know thatthevariousmisrepresentationsin the spamsweremisleading.Trancoshadreasonto know thatBalsamdid not giveir directconsentto sendhim email.becauseTrancosadrnittedthatit

acquiredthelistof emailaddressesformValueClick.RT 295:12-13. Trancoshadreasonto know theprivatelyregrstereddomainnames

misrepresentedthatTrancoswasthetruesourceof thespams.becausethat is theverynatureof privateregistration.andin factthereasonTrancosused privateregistration.RT 240:20-212:9.46122-,4624.

Trancosalsohadreasonto knowthattheFromNamesu,ere misleading.becauseBrianNelsoncouldn'tidentifyhisownadvertisers basedon theFromNames.RT 302:26-3012. (lf Nelsoncouldnotidentifv

theadvertisersafterresearchin_uthequestionin preparationfor trial.this Courtcannotexpecta mererecipientof theemailsto beabieto identifvthe advertisers.)Trancoshadreasonto knowthatoneSr-rbjectLine was rnisleadingbecauseBrianNelsoncouldn'tfigureouthowto qet paid55

ju.;t fortakinga sllrvev.RT at2(i2.12-261:9.Trancoshadreasonto know

thatidentifyingitselfas "USAProductsOnline" wasmisleadingbecause Trancosneverregisteredthefictitiousbusinessname ("FBN"). eventhoush

it knewtt hudtoregisterFBNsandhov'toregisterFBNs.becauseit had

properlyregisteredotherFBNs.RA 9-10,RT -148: l6-20. -150: 16-21. -15'1:11-i5. Trancoshadreasontoknowthatclaiminga boxatTheUPS

Storeasitsbusinessaddresswasmisleading.particularlr,'w,henit sienedr-rp for thebox usingtheunregisteredFBN.in r,'iolationof The UPSStore's

contractandU.S.PostalForm1563.AA 1:213-20.AA 3:-136-87.RT

l5

Cnoss-AppELLANT'sRnplv ro CRoss-Rpspol,loENT'sOppostrtoNro

CROSS.APPELLANT'SOPENTNGBNMT

222:16-223:21.notwithstandingBrianNelson'sfaisetestimonyat triaithat

Trancoshadneverenteredintoanycontractsusingthe

USAProductsOnline.com name.RT 503:2-4.

As discussedabove.Baisamdoesrzolneedto showreliance.because

thestatuteappliesto transactronsintenclerlto resuitin thesaleor leaseof

_eoods or services.Civ.Code $ 1770(ai.andusesa reasonableperson

standard.

J. Civil Codefi 1770(a)(4\

Civil Code $ 1770(a)(4)prohibitsmisrepresentingthegeo-eraphical

originof goodsandservices.

Trancosclaimedthatits emailsoriginatedfrom a box atTheUPS

Store.AA 1:213-20.3:-136-87.u,hichisnottrue.Trancossi-enedup for a

boxatTheUPSStorewhiledeceptiveiyrvriting "USAProductsOnline"-

anunregisteredfictitiousbusinessname - in the "Cornpany" lineand

therebyviolatedtheUPSStore'scontractandU.S.PostalF-orm1,563.AA

l'.219-220.AA 3:480-87.RT 222:16-22321

TrancosclaimsthattheUPSStoreboxwasa vaiidaddressfor the

receiptof rnail.Oppositionat53.andyetBrianNelsontestifiedthathe

neverreceivedBalsam'sinitialdemandletter - a letterthat "should" har,'e

madeitswaytohim. RT 281:8-20.

Finally.Balsamdidnotaskthat/rereceive$2.500for Traneos'

undisputedviolationof &BP Cocle$ 17538.5. t Thit Courtshouldorder

- "lt is unlawfulin thesaleor offeringfor saieof consumergoodsor

servicesfor anypersonconducting,anybusinessin thisstatewhichutihzes to fail to disclosethelegalname

underivhichbtisinessis

whichbusinessis actuallyconductedin all advertisin,eandpromotional

materials., , , Any vrolationof theprovisionsof thissectionrsa

,

thecompletestreetaddressti'om

16

CNCISS.APPELLANT'SREPLYTOCROSS.RPSPONOE:IT'SOPPOSIUONTO

CROSS.APPELLANT'SOPENTNCBNITT

Trancosto pay thefineto theCountyof LosAngeles.whereit deceptivelv

contractedfor a box atTheUPSStore.

4. Civil Codefr1770(at(5\and (at(9\

Civil Code $ 1770(aX5.tprohibitsrepresentin-uthat -eoods and

serviceshavecharacteristicsor benetltswhichtheydo nothave.Civii

Code q 1770(a)(9)prohibitsadvertisinggoodsor sen'iceswith intentnotto

sellthemasadr,'ertised.

TheCourtfound.asa matterof fact.thattheSLrbiectLine "Get pard

5 Dollarsfor I survev"wasmisieadingbecause

If oneclickson theadvertisementfor Surr,'e1lAdventure.vou do not "get paid5 dollarsfor I survey."Indeed.\'ouare obligatedto signupfor threeoffers.thentakemultiple surveysandhaveno guaranteeof gettingpaidanythingby' anyonefor takingthesurvey.Indeedno onew'hotestified rvhoactuallytriedthewebsitegotpaidfor takinga survev.

AA 1:214.

BalsamandhisexpertwitnessJudyHopelainclickedthelinksin the

spamtoresearchthetruthfulness (orlackthereof)of theSubjectLine.and

wentasfiu astheycouldbeforerealizingthattheycould/lot setpaid$5

.7asr f'ortakinga survey

theyhadto "complete promotionaioffers"too.

R'I 339:24-340:6.365:I0-I2.4I-l:I --l I6:25.BrianNelson.Trancos'CEO.

eventestifiedthathewentthroughthere-uistrationprocess.foundthathe

hadto signup tor "inbox rewards."andcouldnotreceive$5.7asttor taking

a survey.RT at262:12-261:9.Thus.Trancos'claimthatthere\.tasno

evidencethatBalsamwouidnotreceive$5withoutspendinganvntone\'.

Oppositionat55-56.isfaise.

misdemeanorpunishableby imprisonmentin thecounty' jail notexceeding sixmonths,or by a fine notexceedin-9two thousandfii'e hundreddollars (52,500),orbyboth."B&P Code $ 17538.5(a).

17

Cnoss.ApPELLANT'SREPLYTOCROSS.RPSPONOENT'SOPPOSITTONTO

CROSS.APPELLANT'SOPENINGBNTrT.

TrancosalsofalselYclaimsrn

itsOpeningBriefat22thattheemail

itselfstatesthata personcandecline

thepromotronaloffers.Nothingin the

emailsaysanythingol thesort.AA

3:.136-39.

5. CivilCodetr1770(a)(16\

Civil Cocle g 1770(aXl6) prohibitsrepresenting thatthesubjectof a

transactionhasbeensuppliedin accordance rvitha prevtot-tsrepresentatlon

whenit hasnot.

TheTrial Courtfoundasa matterof factthatBalsam "presented

uncontradicterjevidencethat [hel neverconsentedto receiveanl'oi these

eightemailsfromanyof

preexistingor currentbusinessrelationshipwithanyof theei-ehtadl'ertisers

whoseproductsor serviceswerethesubjectof theeighternails [1"' AA

a1dthat lBaisam] hadno

I:213.230.

Nevertheless.in eachandeveryspam.Trancos (falsel-v)clarmedthat

Balsamoptedin toreceiveitsemaii.RT i27:5-15.However.Cahfornia's

anti-spamlawhasa "direct consent"requirement.B&P Code$ 17-519'l(d)'

BecauseTrancosacquireditslistfromValueClick.Trancosknew'andhad

reasonto knowthatBalsarrnevergaveir directconsentto sendhim email'

RT 295:22-23.

D.A

nction is

rvtoE

hat Defe

ResumeTheir Unlawful Practices

Do Not

Balsamhasstandingto bringtheCLRA causeof actlon.andTrirncos

vioiatedtheCLRA. Wiil thisCourtgiveTrancostreereignto resumetts

spammingactivity'l

Balsampresentedauthorityin his OpeningBrief.includingfrom the

U.S.SupremeCourt.thatacourtcanissueaninjunctionnherethereisa

reasonabiepossibilitythata defendantma\ resltmeitsunlau'tulactivltres.

18

OppOStnoNTO

CnOSS.ApPELLANT'S

Rnprv TOCROSS'RnSpONnENT'S

CROSS.APPELLANT'S OPETTNC BNTTT.

See,e,g.,LlnitedStatest,.ConcentratedPhosphateE.tportAssocicrtiorl.393

U.S.199 (1968).t-lnitedStatest'.OregonStateMeclicaLSocien.3'13U.S'

326 (1952).FerieralTradeComntissionr',AffbrdablelvlediaLLC. 179F.3d

1228 (gth Cir. 1999).

In ConcentratetlPhosphc1e.theCourtnotedthat "[H]ere wehave

only appellees'own statementthatit wouidbeuneconomicalfor themto

engagein anyturther joint operations."393U.S.at103. Thisise.\ctctll

Trancos' justificationfor stoppingspamrning - it wasn'tprofitable.

Appellant'sOpeningBrief ("AOB") 53.AA l:212.RT 29.1:18-13. -155:i9-

21. 'Ihe logicalimpiication.parricularlysinceTrancosneveradmittedthat

evena singlethingit didwasevenslightlymisleading.is thatTrancos

reservestherightto resumespammin-e.assoonasit clinfigureouthowto

doit profitably.

Thisis why theAffordableMedictcourtstatedthata defendantwho

volunrarilyceasesitsunlawfulbehavioris stillsubjectto aninjunction

becausethedefendantcouldresumeatanytime. 179F.3dat 1137-38

(citation omitted). "lt is thedutyof thecourtsto bewareof effortsto defeat

injunctivereliefby protestationsof repentanceandrefttrm.especiallyw'hen

abanclonmentseemstimedto anticipatesuit.andthereis probabilityof

resumption."OregonSrureMetlicalSocien',343U.S.at333.

Evenassumingthetruthof theclairnthatTrancosstopped

span-uning -

resumingtheirunlawfulspamminganytimetheywish.

In itsdefense.Trancosciteslvl.T.Thornev.Honc'utDretlgittg

Compcutt'. -13 Cal.App.2d131t:,3dDist,19"11).tortheprernisethat "To

authorizetheissuingof aninjunctionit shouldappealri,ith reasonable

certaintythatthewrongfulactsrvill becontinuedor repeated."andTrancos

for now - thereis nothingatall to stopDefendantstrom

19

CnOSS.APPELLANT'S RNPIYTOCROSS.RNSPONNE:\T'SOPPOSITIONTO

CROSS.APPELLANT' SOPENINGBzuET

alsocitesNelsonv'.PearsonFordCo

Dist.l0l0t tbrthepremisethat ".An injunctioncarurotissuein u racuum

base<lon theproponents'fearsaboutsomethingthatmavhappenin the

future.It mustbe supportedby actualevidencethatthereis a realistic

prospectthatthepartyenjoinedintendsto en-sagein theprohibited

activity."As describedabove.Trancoshastestifiedthattheorih reASOntt

stoppedspammingwasbecauseit wasn'tprofitable.notbecause'l-rancos

realizedit didanythingwrong. ln fact.Trancosdothprotesttoomuch

everysentenceTrancoswritesopposinganinjunctionshouldcallsethis

Courtto pauseandconsidervr'ft-r'Trancosfightssohiud, Apparentll'.

186Cal.App.4th983.1020 ('lth

1'rancosis attemptingto reservetherightto resumeits spammtn-e.

In F-rientlsot'theEarthInc. t'.Lttitllav'ErtvirortnerttalSen'ic'e.s

(TOC ) Inc,.theU.S.SupremeCourtstatedthat "a defendantclaimingthat

itsvoluntarycompliancemootsa casebearstheformidableburdenof

shou'in.uthatit is absolutelycleartheailegedll,wrongtulhehal'rorcor-rld

notreasonablybeexpectedtorecur."528U.S.161.lti9-90 (1999). Here.

it iscertainlynotabsolutelyclearthatTrancos 'uvill notresumeits

spamming.If anything.Trancos'actionsdunngitsspamming.itndits

CEO'stestimonyduringthetrial.strongivsuggestthatTr'ancosntayu'ell

restartits spammingoperations.assoonasit fi-euresoutirow it cantLrmii

buckby sendingunsolicitedemarlfrom anaddresswhereit cannotbe '

traced.

III. THIS COURT SHOULD HOLD BRIAN NELSON.TOINTLY/ SEVERALLY LIABLE ON THE JUDGNIENT

Cal.CorporationsCode$$ 17101(a)and (c) and17158(atstatethat

otticersof corporationsandmembersof limitedliabiiitvcompaniesare

20

CnOSS.APPELLANT'S REPLYTO CROSS.RCSPOXUENT,SOPPTISTTTO\iTO CROSS.APPELI,ANT'SOPENTNGBNNT

liablefor theiro\,'ntortiousconduct.See,e.g.,Wtatt v'. (Jnion '\[orrgage

Co.eta\.24Cal.3d113,785 (1919)(citations omitted):seealsoPeopler',

PaciJicLandmarkLLC.129CaLApp.4th1203.1215 (2d Dist.2005)

(holdingthata limitedliabilitycompany'smanagefis not insulatedfrom

liabilityfor participationin tortiousconductmerel,vbecausetheconduct

occurswithinthescopeandroleasa manager).

BrianNelsonclaimsin hisOppositionthattheonlyactir,'it1'Balsam

in which BalsamclaimsNelsonengagedis theprivateregistrationof

certaindomainnames.Oppositionat61. Thisis a faisestatement.

Nelsontestifiedthathepersonallyregistered 'francos lnc.'sdornain

namesto beusedfor spammingandthatthedomainnamesw'ereresistered

usinghiscreditcard.RT 221:4,233:24-26.236l2-13.3I 1:11-13. -161 :26-

462:4.andthatheagreedwith andratifiedthedecisionof anindependent

contractorto privatelyregisterdomainnames.RT -16l:l-l--162:J. Buthe

a/.sostatedthathewasaskedto makedecisronsabouttheemailadvertisins

projectthatresultedin thespamsatissuein thisAction. RT 311:))-26.

Nelsona/sotestifiedthathewasthepointpersonr.l'how'ouldbecontacted

if thecompanyreceiveda certifiedlettercomplainin-uaboutspam.RT

282:11-22.Nelsonalsoadmittedthathewasinvolr,'edin discussionsabout

blacklistsandcomplaintsregardingemailadvertising.RT 300:7-12.

310:l0- i 7. Moreover.Nelsonadmittedthathewasthesolefounderof the

company.RT 441:10-13.andthatTrancosbegansendingcommercial

emailswhenTrancosonlyempioyedthreepeople.RT -l-12:20--t-1.1:19.

Peoplet'.Conw'at'heldthatthepresidentof thecorporation "u asin

a positionto controltheactivitiesof the fcorporation] andthuscouldbe

heidcriminallyliabletorfalseadvertising."12Cal.App.3d875.886 (ld

Dist.197;1.Here.Trancosonlyhadthreemanagementpersonnelwhenrt

2l

CnOSS.APPELLANT'SREPLYTOCROSS-RNSPONNENT,SOPPOSITTONTO

CROSS-APPELLANT'SOPENINGBNITT

sentthespamsatissueto Balsam.AA 3:435.Nelsonwas(andstrllrs)the

ChiefExecutiveOfficer. L/. Nelsonadmittedthatdespitehis wite Laure

Majcherczyk's titleof chief operationsofficer.rrl

salespersonandnotin operationaicontrol'RT 312:3-6'313:l-12'3112)-

shewasreaiiv justa

315:9,Theonlyotherofficer'stitlewasSeniorVicePresident.Crearit'e

Sen,ices.AA 3:-135.Whoelsecontrolledandratified - evenif not

executed - theunlawfulemaiicampaign.rf notNelson'lIf Conwaycould

beheldcriminalltliablefor falseadvertising.thensurely'Nelsonmeetsthe

lowercivil threshold.ThisCourtshouldfind BrianNelsonpersonaill'

liablefor theactionshesetin motion.

IV. NOTE REGARDING TRANCOS' OB.IECTIONS TO BALSAM'S PAGE CITATIONS AND REFERENCES

Trancosmakesmuchin itsRepiyBrieffor itsAppeal.andin its

Opposition Briefto Baisam'sCross-Appeal. aboutBalsam'ssupposedly

impropercitationsto rherecorcl.andactuallysuggeststhatBalsamshouid

losetheentireappealdueto suchcitations.Trancoslsincorrect

crtationerTorsareBalsam'Sattorney'sfault.notBaisam's.andBalsam

shouldnot sufferfor hisattorne)''selrors. Mr. Waltonis preparedto make

a deciarationpursuantto Codeof Civil Procedure$ 'i73 atoralargument.

\ttv such

Moreto thepoint.TrancosattemptstomisleadtheCourtasto what

Balsamactuallyclid.Forthemostpart.Balsamincludedstringcitattonsto

theJudgmentor Complaintantlto testimonyandevidence.In somecases.

Balsammerelyreporteclwhatthetrialcourtfound.withoutactuall,'-relying

on thefindingfor purposesof theappeal.

ThisCourtshouldnotbesicletrackedby Trancos'attemptto focus

attentionawaylrom theactualmeritsof thedispute.

22

OppOStrtONTO

CnOSS-A.ppELLANT'S

REPLYTOCROSS'RESpOxnENT'S

'

CROSS.APPELLANT' SOPENINGBNM

V. CONCLUSION

Forthereasonsstatedherein.thisCourtshouldfind thatBaisamhas standingto bringa CLRA causeof action.andthatthespamsatissue

violatedtheCLRA. ThisCourtshouldordertheTrial Courtto enioin Trancosfrom suchtutureunlawfulspamming.becauseTrancoshasshown no signsof remorseanditsvehementoppositionto aninjunctionsignals

thatit maywell resumeitsspammingassoonasit thinksit cando so

profitably(andwithoutgettingcau-eht).An injunctionservesthepublic interest. ThisCourtshouidalsoholdBrianNelsonpersonailyliablefor

Trancos'unlawfulactions.in whichhepersonallyparticipated.

LAW OFFICESOFTIMOTHY WALTON

Dated:

Aucust19.2011

/s/Timothr J, \\-alton

TimothyJ.Waiton

Attorneysfor Piaintiff.

Respondent.andCross-Appellant

23

Cnoss-AppELLANT'sREpLyro CRoss-RrspoNpE\r'sOppostrtoNro

CROSS.APPELLANT'SOPENINGBNTEN

CERTIFICATEOFWORDCOUNT

(CaliforniaRulesof Court.Rule8.204(cXl)

Thetextof thisbriefconsistsof 6.232words.excludingtablesand thiscertificate.ascountedby theMrcrosoftWord1003wordprocessin-e programusedto generatethebrief.

Dated:

Ausust19.2011

/siTimothvJ.Walton

TimothyJ.Walton Attorneysfbr Plaintiff. Respondent.andCross-Appeilant

24

CNOSS.APPELLANT'SREPLYToCRoSS.RrspoNoENT'SOpposlrloNTo

CROSS.APPELLANT'SOPENINGBRIET

PROOF OF SERVICE AND DELIVERY

I. CathyRiley.declarethat:

i am at leastl8 yearsof ageandnota part,vto theabove-entitled

action.My businessaddressis-fheLawOtficesof DanielBalsam.31+5

GearyBlvd.#225.SanFrancisco.CA 9'1118.

I servedtheforegoingCROSS-APPELLANT'SREPLYTO

CROSS-RESPONDENT'SOPPOSITIONTO CROSS-APPELLANT'S

OPENINGBRIEFonAugust19.2011by depositinga copythereofin a

sealedenvelopewith theU.S.PostalService.with thepostagetully

prepaid.addressedto thepersonslistedbelow:

o

RobertNeison.Nelson& Weinkauf.35N{itcheilBlvd

Suite

15.SanRafael,CA 94903

o

Clerkof theSuperiorCourtof SanlvlateoCounty (Attn: Hon.

MarieS.Weiner), "100CountyCenter.Redw'oodCity.CA

94063

r

;\ppellateCoordinator -

Officeof ther\ttorneyGeneral.

ConsumerLaw Section l0f) q SnrinuSrrssl. LosAngeles.

cA 90013

o

DistrictAttorneyof

SanMateoCounty.

.100 CountyCenter.

3rdFloor.RedwoodCitv.CA 94063

I serveda text-searchablePDFcopyof thebriefon theCairfornia

SupremeCourtby uploadingthebriefto theSupremeCourt's*ebsrte

(http://wrvw.courtinlo.ca.gov/courts/courtsofappeai/appbriefs.cfm ) on

August19.2011.

I declareunderpenaltyof perjuryunderthelawsof theStateof

Californiathatthetoregoingis trueandcorrect.Executedthis 19thda1'of

August.2011atSanFrancisco,California.

/s/CathvRilev

CathyRiley