SUPERIOR COURT OF THE STATE OF CALIFORNIA

FOR THE COUNTY OF LOS ANGELES

DEPARTMENT NO. 57 HON. PAUL G. BRECKENRIDGE, JR., JUDGE

CHURCH OF SCIENTOLOGY OF CALIFORNIA, Plaintiff, vs. GERALD ARMSTRONG, Defendant. MARY SUE HUBBARD, Intervenor.

) ) ) ) ) ) ) )

No. C 420153

REPORTERS' DAILY TRANSCRIPT

Wednesday, June 6, 1984

Volume 25

Pages 4548 through 4683, incl.

APPEARANCES: (See Appearances Page)

NANCY L. HARRIS, CSR #644 HERB CANNON, CSR #1923 Official Reporters

APPEARANCES:

For the Plaintiff:	PETERSON & BRYNAN BY: JOHN G. PETERSON 8530 Wilshire Boulevard Suite 407 Beverly Hills, California 90211 (213) 659-9965 -and- ROBERT N. HARRIS The Oviatt Building 617 South Olive Street Suite 915 Los Angeles, California 90014 (213) 623-7511
For the Intervenor:	LITT & STORMER BY: BARRETT S. LITT Paramount Plaza 3550 Wilshire Boulevard Suite 1200 Los Angeles, California 90010 (213) 386-4303 -and- BARRETT S. LITT BY: MICHAEL S. MAGNUSON The Oviatt Building 617 South Olive Street Suite 1000 Los Angeles, California 90014 (213) 623-7511
For the Defendant:	CONTOS & BUNCH BY: MICHAEL J. FLYNN - and - JULIA DRAGOJEVIC 5855 Topanga Canyon Boulevard| Suite 400 Woodland Hills, California 91367 (213) 716-9400

INDEX FOR VOLUME 26		Pages 4548 — 4683, incl.
DAY	DATE		PAGE
Wednesday	June 6, 1984	A.M.	4548
		P.M.	4625

EXHIBITS

PLAINTIFF'S:	IN EVIDENCE
(The following exhibits have been previously marked for identification and described:)
88, 89 -	4551
91, 94, 95, 96, 97 -	4552
98, 99, 101, 102, 103, 104 -	4553
105, 106, 107, 108, 109, 110, 111, 112 -	4554
115 - (Offered by Mr. Flynn)	4555
116 -	4550

DEFENDANT'S:	IN EVIDENCE
(The following exhibits havea been previously marked for identification and described in the 500-series:)
A, H -	4558
I -	4559
J, K, L -	4560
M, N -	4561
O, P, Q -	4562
R -	4563
S, T -	4564
U -	4565
V -	4566
W, X -	4568
Y -	4569
AA, BB, CC -	4570
DD, EE, FF -	4572
GG, HH -	4573

II

INDEX FOR VOLUME 26 (Continued)

EXHIBITS

DEFENDANT'S:	IN EVIDENCE
II, JJ -	4574
LL, MM, NN, OO -	4575
PP, RR, SS -	4576
UU, VV -	4577
WW -	4579
XX, ZZ -	4584
AAA, BBB, CCC, DDD, EEE -	4585
FFF -	4586
GGG -	4587
HHH, III, JJJ, KKK, LLL, MMM -	4587
NNN, OOO -	4589
PPP, RRR, SSS, TTT, UUU, VVV, WWW, XXX, YYY -	4593
ZZZ - (Remains for identification but ordered unsealed)
AAAA, BBBB -	4597
CCCC -	4598
JJJJ -	4606
KKKK -	4607
LLLL -	4609
MMMM -	4610
QQQQ, RRRR -	4616
SSSS -	4617
TTTT -	4619
UUUU, VVVV, WWWW -	4623
XXXX -	4622
YYYY -	4623
BBBBB -	4632
DDDDD-1	4639
EEEEE -	4642
FFFFF -	4644
HHHHH -	4645
JJJJJ -	4647

III

INDEX FOR VOLUME 26 (Continued)

EXHIBITS

DEFENDANT'S:	IN EVIDENCE
MMMMM -	4649
NNNNN -	4650
RRRRR -	4654
SSSSS -	4656
UUUUU -	4659
WWWWW -	4659
XXXXX -	4660
ZZZZZ, AAAAAA -	4661
DDDDDD -	4663
EEEEEE -	4664
HHHHHH, JJJJJJJ, KKKKKK -	4665
LLLLLLL, MMMMMM -	4666
PPPPPP -	4670
RRRRRR -	4673
XXXXXX, YYYYYY -	4680

4548

LOS ANGELES, CALIFORNIA; WEDNESDAY, JUNE 6, 1984; 9:15 A.M.
oOo

THE COURT: All right, in the case on trial let the record reflect that counsel are present. Yes, Mr. Flynn?

MR. FLYNN: Your Honor, before we get started I'd like to correct one thing that occurred yesterday.

Mr. Schomer I have in the courtroom. He was on the witness stand. He was asked a question about having documents, and there was some interchange about the First or Fifth Amendment. We'd like to withdraw that indication. I had not had the opportunity to consult him.

It turns out that there are no documents and that Mr. Schomer had a conversation with Milt and Laurel Wolfe when they came to his home, and he was afraid for his life. So he led them to believe that he had documents in his safe deposit box so that they would think that if they did anything to him, the documents would be there. There would be some type of a deterrence against anything being done to him.

4549

THE COURT: Do you want to put him back on the stand to so testify? You may do so.

MR. FLYNN: Thank you, Your Honor.

MR. LITT: Your Honor, we can solve that problem. We'll withdraw the question and there's no invocation of the privilege.

THE COURT: All right. Then you stipulate the question is withdrawn?

MR. HARRIS: Yes, Your Honor.

THE COURT: The answer will also be stricken, then.

MR. HARRIS: We have no further witnesses.

MR. LITT: Your Honor, we do have one additional exhibit, a certified copy of the articles of incorporation of the Archdiocese of Los Angeles. We would like to introduce it.

THE COURT: For the Catholic Church?

MR. LITT: Yes. It is strictly for purposes of demonstrating various corporate arrangements and the relationship in corporate papers between ecclesiastic and corporate law in the Catholic structure.

THE COURT: What are we up to?

THE CLERK: 116, Your Honor.

MR. FLYNN: I would object, Your Honor.

THE COURT: What am I supposed to compare this to, the articles of incorporation of the Church of Scientology?

MR. LITT: It will simply be used in argument, Your Honor, with a discussion of the relationship between corporate and ecclesiastical authority. And since

4550

Scientology is a rather new religion and Catholicism is a rather old religion, it is felt that showing how certain arrangements worked in the Catholic Church which were analogous to how certain arrangements worked in the Church of Scientology would help to clarify questions of ecclesiastic versus corporate.

MR. FLYNN: I would object, Your Honor. I think the more appropriate incorporation papers should be submitted are those from ASI.

MR. LITT: It is also illustrative of Mr. Flinn's testimony who testified about the corporate soul, Your Honor.

THE COURT: I'll overrule the objection. It can be received. I am not sure what effect it will have on the lawsuit. If counsel wants to argue something with reference to it, we'll see.

We should take up the matter of the admissibility of certain exhibits.

What additional Plaintiffs' exhibits do we have excluding for the moment the exhibits under seal?

4551

MR. LITT: I think we start with 88, Your Honor.

THE COURT: All right, exhibit 88.

The witness testified, this is regarding indexing of names and references to letters E and US External; are you offering that in evidence, Counsel?

MR. LITT: Yes, Your Honor.

THE COURT: Any objection?

MR. FLYNN: I think I can save some time, Your Honor. I don't believe we have any objection to anything except the Articles of Incorporation which you have just admitted, so I don't believe on anything else we have an objection.

THE COURT: Well I will go through these.

88 you have no objection, be received.

89 is the Great Wall sightseeing trip. I assume you are offering that. Any objection to that?

MR. FLYNN: No, Your Honor.

THE COURT: All right, be received.

90 is already in.

92 is a letter of Northwest Sea Frontier signed by Frank Jack Fletcher.

MR. FLYNN: No objection to that.

THE COURT: Be received.

92 is already in.

93 is policy letter of 3/1/65, Suppressive Acts; are you offering that?

MR. HARRIS: Yes, Your Honor.

THE COURT: Any objection?

MR. FLYNN: No.

4552

THE COURT: Be received.

94 is HCO policy letter of 17 March, '65; any objection to that?

MR. FLYNN: No, Your Honor.

THE COURT: Be received.

95 starts out, "A cleared cannibal is a cleared cannibal" at the top. Are you offering that?

MR. HARRIS: Yes.

THE COURT: Any objection?

MR. FLYNN: No.

THE COURT: Be received.

96 is HCO policy letter 23 December, '65.

MR. FLYNN: No objection.

THE COURT: Be received. 97?

MR. HARRIS: Yes, Your Honor.

MR. FLYNN: No objection.

THE COURT: The clerk has noted that page 5 is missing. I don't know what page 5 is. We have a 4 and a 6.

MR. HARRIS: We will replace it with one that has all pages. Your Honor.

MR. FLYNN: That page says, I believe, that the possessions, homes and properties of SP's are not to be protected.

MR. HARRIS: I don't know what it says. I will get you a full copy of it.

THE COURT: 97 when it is presented as a full copy will be received.

4553

MR. HARRIS: All right.

THE COURT: And 98 is ethics, penalties, 6 October, '70; any objection to that?

MR. FLYNN: No, Your Honor.

THE COURT: 99 is Suppressive Person Declare for Mr. Sommer.

MR. FLYNN: No objection.

THE COURT: Be received. What about 100?

MR. LITT: We have a problem. 1 just checked to make sure that a copy had been made for the court and it turns out it hasn't, and we have a call in now. So maybe we should just hold that.

THE COURT: 101 is conditions, awards and penances, revised. Any objections to that?

MR. FLYNN: No, Your Honor.

THE COURT: Be received.

102 is a similar document of 6 October, '75; any objection to that?

MR. FLYNN: No, Your Honor.

THE COURT: Be received.

103 is the HCO policy letter of 29 April, '65.

MR. FLYNN: No objection.

THE COURT: Be received.

104 is the China Yearbook.

MR. FLYNN: No objection.

THE COURT: Be received.

105 is the commission — no, the appointment

4554

to the Naval Reserve.

MR. FLYNN: No objection.

THE COURT: Be received.

106 is the death certificate of Commander Thompson.

MR. FLYNN: No objection.

THE COURT: Be received.

107 is the Library of Congress –

MR. FLYNN: No objection.

THE COURT: Be received.

108 is a Library of Congress, Sigmund Frued [Freud] collection.

MR. FLYNN: No objection.

THE COURT: Be received.

109 is U.S. Naval Medical Bulletin.

MR. FLYNN: No objection.

THE COURT: All right. Be received.

110 is the drawing of Commander Thompson, Snake Thompson.

MR. FLYNN: No objection.

THE COURT: Be received.

111 is the letter from Mr. Armstrong to "Dear Sue."

MR. FLYNN: No objection.

THE COURT: Be received.

112 is letter of Gerry Armstrong, Dear Sue, of 26 November, 1981.

MR. FLYNN: No objection.

THE COURT: Be received.

4555

THE COURT: 113 is already in.

114 is in evidence.

115 is –

MR. LITT: 115 is not identified by Mrs. Douglas So we won't move it. She couldn't identify it.

THE COURT: I guess it was just used to refresh her memory on dates. It won't be received.

MR. FLYNN: I'll offer it.

THE COURT: Was that her name, Carol Elizabeth Dunleavy?

MR. FLYNN: It was, Your Honor. She was married to Tony Dunleavy at that time.

MR. HARRIS: I know that to be true, Your Honor.

THE COURT: I'll receive it.

Do we have any defense exhibits other than the matters under seal that we haven't dealt with?

Well, I think we should start with the defense exhibits under seal.

I gather some of the Plaintiff's offerings are contingent upon what the Court does with the defense offerings?

MR. HARRIS: Yes, Your Honor.

THE COURT: What is your position? Are you offering all of them, or do you want to go through them individually?

MR. FLYNN: I'll offer all of them, Your Honor.

THE COURT: That have been marked?

MR. FLYNN: Correct.

THE COURT: I guess we'll have to go through — I assume

4556

you want to object individually?

MR. HARRIS: I think there would be an overall general objection, Your Honor, as well as some specifics.

THE COURT: Why don't we do the general objections because I don't want to have the same argument each time, depending on what the Court does.

4557

MR. HARRIS: With respect to the general objection, Your Honor, there are about three kinds of general objections. One is privacy interest being outweighed by — well, the reverse, relevance being outweighed by privacy interests which Your Honor will probably have to wake a determination from time to time; for example, some of the items have been previously published. Obviously, we have no objection to those.

But as to items that have not been previously published, they are items which Your Honor is going to have to make a document by document determination.

THE COURT: We can deal with that in due course.

MR. HARRIS: There's another whole class of items, Your Honor, where Mr. Armstrong would identify one document, for example, in a whole pack as something he was going to talk about. The rest of the documents were not identified, but just sort of a generalized claim, well, this is correspondence to the Greek fellow — I can't pronounce his name — for example.

THE COURT: We'll have to deal with that on a case-by-case basis.

MR. HARRIS: Finally, with respect to all of these, the general request would be if anything goes into evidence, that they remain under seal or be newly resealed, which ever the Court desires.

THE COURT: Again, we'll deal with that on a case-by-case basis.

My general reaction is going to be if it comes

4558

in evidence, it will come in evidence as any other exhibit. Things that regain for identification, there may well be things that should remain under seal and things where that is not required. But let's start, I guess, with — these will all be exhibit 500. I won't keep repeating that.

This is H, also known as 500-A.

MR. HARRIS: It appears to have been published.

THE COURT: "Brief biography L. Ron Hubbard."

MR. HARRIS: Right.

THE COURT: It came out of the PRO News.

MR. HARRIS: Yes.

THE COURT: You are offering that?

MR. FLYNN: Yes.

THE COURT: Any objection?

MR. HARRIS: None other than the general objection as previously stated.

THE COURT: Exhibit H, which is also known as 500-A, will be received in evidence.

Now, we have 500-H, "Facts about L. Ron Hubbard, things you should know, divisional directive."

Any objection to this?

MR. HARRIS: Unless it has "confidential" written at the top of it, Your Honor, no.

It obviously has been published.

THE COURT: It will be received.

500-I: "Worldwide Guardian's Office, David Gaiman.

"Dear David" from "LRH transcriber."

4559

MR. HARRIS: Not having been published, Your Honor, there would be an objection.

MR. FLYNN: There was a lot of testimony about that exhibit, Your Honor, from Laurel Sullivan, Gerald Armstrong. It was referred to. They used it themselves in their own examinations.

THE COURT: This appears to be the first person, written in the first person.

There has been a lot of discussion about whether any of these biographies which were attributed were really the words of L. Ron Hubbard or somebody else. This appears to be supportive of Mr. Armstrong's position here.

So I'll overrule the objection. It will be received in evidence, 500-I.

4560

500-J. I guess this is excerpts from "Who's Who" I suppose, "2000 Men of Achievement, 1977." Maybe that is the name of the publication.

MR. HARRIS: It is a publication, Your Honor, is what it is.

THE COURT: Are you offering this?

MR. FLYNN: Yes, Your Honor.

THE COURT: All right, be received.

500-K would appear to be a curriculum vitae for Lafayette Ronald Hubbard. I don't recall specifically the context in which there was testimony on this other than this was something that Mr. Armstrong relied upon and what would be necessary for his defense witness case.

MR. FLYNN: I believe there are facts in there, Your Honor, he testified about?

THE COURT: Any objection to this one?

MR. HARRIS: It doesn't appear to be published. It would be the general objection, Your Honor.

THE COURT: Overruled. I will receive it.

500-L?

MR. HARRIS: Well, that is a published –

THE COURT: Policy letter of 1 September, '66, copyrighted.

MR. HARRIS: Yes, published. Your Honor.

THE COURT: All right, I will receive it. 500-M is the Explorer's Club data.

MR. HARRIS: Yes.

On that one, Your Honor, these are correspondences

4561

between — well I guess there is more than just that item.

THE COURT: 500-N, also.

MR. HARRIS: Right, and all of them have to do with the Explorer's Club, Mr. Hubbard's communication and other communications with the Explorer's Club.

May I just look at that? I am burdened by having a bit of a description of it.

THE COURT: Yes.

MR. FLYNN: Your Honor, our position is they are both public and they have false information in the applications.

MR. HARRIS: Insofar as the application, I don't think it is a public matter and I'd object to it.

MR. FLYNN: The witness testified at some length, Your Honor, about the fact that he — Mr. Hubbard had held himself out as a member of the Explorer's Club, and that his application was false, parts of it were.

THE COURT: I will overrule the objection; be received.

500-O is the Sea Org executive directive to Flag, confidential, Flag only. Subject LRH image survey of personality traits.

MR. FLYNN: There was extensive testimony about that from Laurel Sullivan and Mr. Armstrong.

THE COURT: Any particular objection, gentlemen?

KR. HARRIS: Other than it being limitedly published. Your Honor, no.

THE COURT: Is there such a word; "limitedly"?

MR. HARRIS: Limitedly.

4562

THE COURT: I think there probably is.

MR. HARRIS: If there is, there is. If there is not, I have just committed an error.

THE COURT: You have just coined a word.

All right, I will overrule the objection; be received.

P is the blue Org, blue paper executive director Flag, LRH biography survey. This, I presume, was actually the precursor or, no, I guess it had — it follows, I guess, this other one that is just received.

MR. HARRIS: Does it say "confidential" on top of it? I will make the same limitedly –

THE COURT: It doesn't I don't think.

MR. HARRIS: Then I assume it's been published and I have no objection.

THE COURT: I don't know whether it has been published or not.

I will receive it.

Exhibit Q is Flag ship order of the Sea Org, 8 January, '75, facts about L. Ron Hubbard. "This issue is for briefing purposes only of on-board PROs only."

MR. HARRIS: Very limited distribution. Your Honor; same objection.

THE COURT: Overruled; be received.

R is the executive directive from L. Ron Hubbard, confidential LRH No. 1, 7/12/68, duties of Pers Sec.

MR. FLYNN: There was testimony from Laurel Sullivan about that to confirm the fact that those people worked for

4563

L. Ron Hubbard personally. There is something in the back documents that says that.

THE COURT: Apparently this is — attached is the handwritten — in other words, the face is what is typed up from the handwritten notes of L. Ron Hubbard to authenticate this as being his writing, I guess.

MR. FLYNN: Correct, Your Honor. I believe there was testimony to that fact.

THE COURT: It says, "Whatever comes under the heading of my purely personal interests apart from my Org interests and duties as head of the LRH Pers sec, whatever policy may say …"

All right, be overruled; be received.

4564

Exhibit S is the "Executive Directive re my post 18 February, '76; variety of hats."

Attached to it also is a Sea Org late December,'75 "LRH Personal PRO Functions and Publics."

MR. FLYNN: Offered for the same reason as the last one, Your Honor.

THE COURT: Any objection, gentlemen?

MR. HARRIS: Same general objections, Your Honor; no specific one as to that.

THE COURT: Well, I'll just deem your same general objections being raised individually. And if you want to be heard further –

MR. HARRIS: Surely. And on that one, relevance to this witness because he wasn't around at the time, Your Honor.

THE COURT: All right. Overruled. It will be received.

I will now skip to DD; is that right — well, 500-T also known as DD.

This is what Laurel Sullivan read before the group at the Palladium, apparently.

MR. HARRIS: Also, apparently, in evidence as another exhibit, Your Honor.

THE COURT: It hasn't been received yet.

I'll receive it in evidence. It is what she read to the Palladium group.

It is also, I guess — well, I guess it goes under an alias of 500-T.

So we have 500-U.

4565

MR. HARRIS: Yes; handwritten notes of Mr. Hubbard; appear to be something directed to the press, but no indication that it was published.

Mr. Armstrong's statement about it wasn't that it was false or fraudulent, but that it was — ". . .he is 50 years old and he is still producing the same sort of, I don't know, braggadocio, something like that."

It is sort of a generalized claim. I don't think it is relevant.

THE COURT: Well, I think this is where he was writing his own press releases as though it were written by somebody else.

MR. HARRIS: It doesn't say that, Your Honor.

MR. FLYNN: That is the indication, Your Honor.

I believe Mr. Armstrong testified he didn't believe the flight ever took place.

MR. HARRIS: The transcript, Your Honor, doesn't reflect that. And it is pages 18 to 26.

Precise words: ". . .and I only thought that it might have significance because to me it evidenced the same sort of mentality and the same hyperbole that he had been putting out about himself for so many years. And here he is, an adult of 50-some-odd years old and he is still producing the same sort of, I don't know, braggadocio or something like that."

THE COURT: I'll receive it in evidence as illustrative of Mr. Armstrong's contention in that regard.

4566

Exhibit -V, ". . .write letter to Daily Sketch as follows for Jack's signature. . ."

MR. FLYNN: There he claims that he is having someone else write the letter for him and he is claiming he is an author and not a medical practitioner. In other documents he claims the reverse. And in still other documents he claims things different from that. He is holding himself out to different people as different things at different times.

MR. HARRIS: I know of no document where Mr. Hubbard claims to be a medical practitioner, Your Honor.

THE COURT: It is suggestive of his propensity toward legal action.

MR. HARRIS: Well –

THE COURT: ". . .I wish you to place suit against the Daily Sketch for representing me as mental practitioner and saying I treat people. I am an author. And a statement saying I treat patients could bring me into conflict with the law and is a lie. Write our solicitors. We desire you to sue the Daily Sketch in the name of the association if they refuse to publish a denial of this article. The man Scott is a known mental patient. The reporter as promised failed to submit his copy to the association."

I'll overrule the objection. It will be received.

4567

500-W, data sheet.

MR. HARRIS: I will have to look at that, Your Honor.

THE COURT: (Reading:)

"Scientology is that branch of psychology which treats of human ability. This departs from older psychology … Scientology is used to increase intelligence. It is used by the London County Council Schools. It also increases reaction time and as such is used by various Air Forces through the world. Many motion picture companies use Scientology to increase acting ability and improve appearance of stars. Hubbard is in Eire to write several books Hobby Photography."

MR. FLYNN: He says at the top of that, Your Honor, he puts in his own handwriting that he is B.Sc, Bachelor of Science, and then next to that he puts Ph.D.

MR. HARRIS: Well, it is old.

THE COURT: Yes, indeed.

MR. HARRIS: My objection is it is old and uninteresting.

MR. FLYNN: Mr. Armstrong testified that that was evidence of Mr. Hubbard's own writing, holding himself out as having a Bachelor of Science degree and a Ph.D.

MR. HARRIS: Well, I don't know that it is Mr. Hubbard's handwriting. Maybe Your Honor could make a determination of that.

MR. FLYNN: It was identified by Mr. Armstrong.

THE COURT: Well I don't think I am qualified to make

4568

that type of a judgment, but it will be received; 500-W. It is old, but apparently still has some probative value.

500-X is a brief biography of L. Ron Hubbard.

MR. HARRIS: It appears to be published. Your Honor; no objection.

THE COURT: Be received.

Y is the "Story of Dianetics and Scientology." Appears to be a transcript perhaps of a tape. There is some reference to applause.

MR. FLYNN: That is a tape where he says he received, I believe, $10,000 for the screenplay of "Dive Bomber" and pat it in a bank account in $1,000 bills which he held until after the war.

MR. HARRIS: I don't know about the accuracy of the transcript, Your Honor, but if it was published; i.e., either was a tape and it was published, then no objection.

THE COURT: He also talks about his experience aboard ship during the war when he had two people a week going mad.

"Two people a week went mad on that ship. That's an awful lot of people going mad. But in view of the fact that we had no replacements, …"

Maybe this is part of his fiction story.

During the last year he studied at the Oak Knoll Naval Hospital Library and he found out by the simple expedient of taking off one collar ornament he became an M.D. Studied the endocrine system.

Well he gets out of service, "So they gave me a nice big thick sheath of treasury checks. Well in addition

4569

to that I hadn't had it too bad. I had sold a movie — Dive Bomber, you may have seen the thing — Wallace Beery and so forth … "

All right, I will receive it in evidence.

500-Z. This starts out

"Dear Ron,

"Who's Who in California.

"You may care to be included in this listing.

"I have made a start on the form: Mill you please correct and fill out if you are interested.

"Shall I pay from here or arrange through New York?

"Love Irene.

"Inform Julia am using L.A. address. Give her one finished and Xerox copy.

"Love H" or "LRH.

"Add war record, 1940-46 service in five theaters, 21 medals and palms, resigned 1950."

4570

THE COURT: Any objection this, gentlemen?

MR. HARRIS: None but the overall.

THE COURT: Overruled. It will be received.

BB is a report of physical examination; date of examination, 4-18-41.

Is there any objection to this?

MR. HARRIS: General privacy; a bit more so with respect to medical records. There are a series of medical records, all of which I would have the same considerations about.

MR. FLYNN: We offer that because of the eye examination findings, Your Honor, at the beginning of the war and again at the end of the war.

THE COURT: It will be received. Overruled.

500-CC is from the Commanding Officer, Separation Center, San Francisco to L. R. Hubbard.

"Examined and found to be physically qualified for release from active duty."

MR. FLYNN: That is why we offered that, Your Honor.

THE COURT: Certified; signed at the bottom by Mr. Hubbard.

He certifies the data listed below is correct; it hasn't anything to do, I guess, with the information above.

MR. HARRIS: Probable place of separation or –

THE COURT: Is there any particular objection to that?

MR. HARRIS: No.

THE COURT: It will be received.

4571

DD is a report of the proceedings of the Naval Medical Survey Review Board convened at the Navy Department by order of the Secretary of the Navy:

"To review the release from active service of Lieutenant Lafayette Ronald Hubbard, U.S. Naval Reserve, without pay for physical disability pursuant to the decision of a Board of Medical Survey. June 11, 1948."

MR. FLYNN: There are numerous notations in those records, Your Honor. I believe one is to the effect that Mr. Hubbard claims to have spent a year or two years in a civilian hospital after the war. I think that is in that exhibit, that there are numerous statements about his medical condition when compared to other records which Mr. Armstrong testified at length about show direct conflict.

THE COURT: All right.

Any additional objections?

MR. HARRIS: No.

The medical records all have the same objections, Your Honor, and that is enhanced by privacy with respect to them.

Again, I mean if these are being offered for the truth of the matter asserted, for example, his eyes and so on, hearsay purposes. I again assume this is all going in for Mr. Armstrong's state of mind with respect to these items.

THE COURT: They apparently belonged to Mr. Hubbard at one time. They apparently still do.

4572

Overruled. It will be received.

EE is the LRH Naval records, dental records, medical history.

MR. FLYNN: I think those records may show the chronology, Your Honor.

Mr. Armstrong relied on the history, particularly the medical history which became a major issue in the case.

Mr. Young testified that there were missing medical records.

Captain Moulton testified that Mr. Hubbard told him he had been wounded by machine gun fire. And all of the records taken in toto show that.

THE COURT: These may all be false because he may have been an intelligence officer.

MR. HARRIS: There is some evidence of that.

THE COURT: Of course, Mr. Hubbard was keeping this information for some purpose, I guess.

I'll overrule the objection. It will be received.

FF is a replication of something else, maybe. But it is a first endorsement from the Commandant to the Chief Bureau Navs.

MR. HARRIS: That has no medical history, Your Honor. I have no objection.

THE COURT: It will be received.

GG is a special board of medical examiners; appears like a minute order. (Reading:}

4573

We certify that Lafayette Hubbard is physically qualified to perform all of his duties at sea and do recommend him to appointment U.S. Naval Reserve, June 11, 1941."

Any objection?

MR. HARRIS: No, Your Honor.

THE COURT: It will be received.

HH, this appears to be a declaration, an affidavit by Mr. Hubbard. I guess this had to do with how old Mr. Hubbard was.

MR. FLYNN: It had to do with what Mr. Armstrong found that Mr. Hubbard even lied about his age; he lied about his age to get into the National Guard.

And at the age of 16, after flunking out of high school, he was trying to get into the National Guard. Mr. Young has testified that he was studying the mind under Commander Thompson in the early 1920's which would have been the same period of time. It would refute the fact that –

MR. LITT: That misstates Mr. Young's testimony, Your Honor.

THE COURT: Well, is there any particular objection to that one?

MR. HARRIS: Yes, Your Honor.

THE COURT: The objection is overruled. It will be received.

We have II, a report of compliance with order; statement mailed from Australia, but possibly not received.

4574

This is a copy of an original which appears to be signed by Mr. Hubbard.

"Sailed from U.S.; duty outside continental limits December 17, 1941; arrived in U.S. from duty outside continental limits on March 23, 1941."

Any objection to this?

MR. HARRIS: No, Your Honor, other than — again, assuming all the generalized ones.

THE COURT: Right.

It will be received.

500-JJ has "confidential" scratched out for some reason.

It is Finnish Discipline File following from U.S. Melbourne.

". . .Lieutenant Hubbard has been ordered to return to U.S. via Chaumont; report to Commander 12. Unsatisfactory for any available assignment, A report mailed. . ." et cetera.

Is there any particular objection to this?

MR. HARRIS: No, Your Honor.

THE COURT: It will be received.

KK is from Naval Attache to Commandant 12, "subject Hubbard." It is signed by "L. D. Cosey."

Any objection to this?

MR. HARRIS: No.

THE COURT: It will be received.

4575

LL is from the Chief Cable Center to the Chief Bureau Nav regarding Mr. Hubbard being sent to the cable office of the Cable Center in New York; any objection to that?

MR. HARRIS: No, Your Honor.

THE COURT: Be received.

500 double M, not terribly legible. It is another one of the transfer type orders, I guess. Any objection to that?

MR. HARRIS: No, Your Honor.

THE COURT: All right, be received.

NN is a report of compliance with orders signed by Mr. Hubbard; any objection?

MR. HARRIS: No, Your Honor.

THE COURT: Be received.

OO is a directive from Commandant to Mr. Hubbard regarding a telephone conversation. He was to be detached from the YP 422.

"You will proceed and report to the Commandant, Third Naval District for such duty as he may assign you. E. Y. Copeland, Captain by direction."

Any other objection?

MR. HARRIS: No, Your Honor.

THE COURT: Be received.

PP is — any objection to that?

MR. HARRIS: If it is the same sort of thing, doesn't include medical information, no.

4576

THE COURT: No, It is sort of a neutral thing. Be received. I guess it traces his history, movements.

QQ is the report on fitness of officer of period 29 May, '43 to 7 July, '43.

MR. HARRIS: It is not medical information then.

THE COURT: This is signed by Braisted, the admiral that he referred to later on with some contempt. All right, I will receive that.

Double R is from the Commander Fleet Operations to Lieutenant Hubbard, subject letter of admonition. This is regarding the gunnery practice in Mexico.

MR. HARRIS: Right, no objection.

THE COURT: All right, be received.

Double S, report on fitness of officer.

MR. HARRIS: Contains no medical information, I presume, Your Honor.

THE COURT: I think this is a duplicate of — it is a duplicate of QQ.

MR. HARRIS: Well then it is cumulative and that would be my objection.

MR. FLYNN: We won't offer it. Your Honor.

I think there were two different Xerox copies and one is an eight by eleven and the other is legal length, and might have been material in the smaller Xerox that wasn't on the later one when we were compiling them.

THE COURT: Well, the later one is more legible than the prior one, so I will receive SS and I will vacate my order admitting QQ and let that stand for identification only.

4577

PP is annual qualifications questionnaire, Naval Reserve Officers inactive. Bureau of Naval Personnel, signed 10/17/48.

Any objection or any other objection to this?

MR. HARRIS: No, Your Honor.

THE COURT: Undergraduate, majored in civil engineering, All right, be received.

500-UU is report on the fitness of officer.

MR. HARRIS: All those, Your Honor, if there is no medical information –

THE COURT: All right, be received.

W is another one of these same things.

Handwritten, just completed the course in military government, Princeton University, standing about midway. All right.

Be received.

I have got a manila folder here. We don't need that, I guess.

MR. FLYNN: That orange binder was in there, I believe, Your Honor.

THE COURT: 500-W is LRH Naval records.

MR. FLYNN: They should be paper clipped or there were paper clipped pages. The record shows the overall chronology for certain critical pages about which Mr. Armstrong testified.

MR. HARRIS: It is kind of hard to identify the paper clipped pages except by leaving paperclips on them. Your Honor.

I suggest we are going to have problems later

4578

on with the same sort of thing unless we sub mark the pages to which Mr. Armstrong made reference.

THE COURT: We will leave the paperclips in there, but the pages can be sub marked as WW-1, WW-2, et seq, and I will ask the clerk to do that here; 1, 2, 3, 4, 5, 6 paperclips in there so we will have 1 through 6. That will be the sub markings for those.

MR. HARRIS: And only those will be received in evidence. Your Honor?

MR. FLYNN: Well, Your Honor, as soon as we lose any chronology, as you can see from Mr. Young's testimony, we run the risk of never having the records again and not being able to prove something that might become significant if this case is appealed.

THE COURT: I am not concerned with that insofar as this point in receiving this exhibit in evidence. I don't think that there is anything in here that is — let's see –

4579

MR. FLYNN: I don't believe we paper clipped all the relevant pages, Your Honor. We were under severe time constraints when we were preparing these exhibits.

There are a number of exhibits that fall into this category. There is one in particular which is the –

THE COURT: I'll receive this in its entirety. All the other Naval records, this is just some more of them. If there is something in there that you want to go through and make a special motion to strike or delete, I'll consider it. But it appears to be much more of the same thing, his applications for a commission; his letters of recommendations.

MR. HARRIS: If that is Your Honor's understanding of it and if that is an accurate description of it, we won't go through it and pull out things and make specific objections.

THE COURT: Now we have 500-XX which is a letter from J. D. Wilson, Captain, Head, Neuropsychiatry Branch, written to Miss Paulette Cooper.

MR. FLYNN: The importance of this exhibit, Your Honor, is, I believe — if it is the correct one — and I think Mr. Armstrong testified about it — I believe this is the one where the organization, apart from having access to Mr. Hubbard's own medical records, own Naval records, went out and through the Freedom of Information Act, obtained Naval records. And I believe this is in the period of the mid or early '70's, sometime in that period, and they learned what Mr. Hubbard's Naval history was with regard to the

4580

accuracy.

It shows independent selection of information about Mr. Hubbard's Naval history by the Guardian's Office.

MR. HARRIS: Well, the Freedom of Information Act first came into effect, as I recall, Your Honor, in 1973.

I would be willing to stipulate that the Guardian's Office used the Freedom of Information Act and obtained medical or Naval information pursuant to that. But I can't attest that that is what they got.

THE COURT: What did Mr. Armstrong testify about these?

MR. HARRIS: I don't see any reference to it at all. But maybe there is.

MR. FLYNN: I believe there is, Your Honor. I believe it is basically, it was Mr. Armstrong's view that even though the organization was perpetrating the same statements about Mr. Hubbard's Naval background, that there was clear evidence that they had the facts relative to his Naval background as early as, at least, those dates set forth in there which, I believe, was in the mid-'70s. And it may be information in there on the retirement, the medical retirement board.

THE COURT: Well, there are a number of medical matters in here. It appears to be medical — apparently the Granada Television Service Limited — if there is such an entity — sent a letter to the Bureau of Medicine, Surgery, seeking information for the purpose of making a documentary film about him.

4581

"We understand that Hubbard was a patient of the Oak Knoll Naval Hospital. Sometime during his illness he apparently formed a great deal of his philosophy of life and Dianetics which later evolved into Scientology. Could you furnish any information about Hubbard. . ."

et cetera. Attached to this looks like all kinds of medical records. I am not sure whether he sent —

MR. HARRIS: I don't know, Your Honor.

MR. LITT: Your Honor, I believe that is one of the — I'm not sure, but I don't think that we have seen one. I don't know whether there is a copy available or not. I'm not familiar with it. I don't think Mr. Harris is either.

MR. FLYNN: Your Honor, I think what the Naval Office was trying to find out is who had sought information from the Naval Department and what records had been sent to people such as Cooper and the other entity Your Honor just mentioned together with collecting documents on his medical background which would establish whether, for example, he had received a Purple Heart, was crippled and blinded from war wounds, had served four years in combat and items of that nature.

4582

And I believe the records attached to that exhibit, together with other records collectively related to his Naval history, totally refute the claims of Mr. Hubbard.

THE COURT: You say you haven't seen these?

MR. LITT: Well, can we take a look at it?

THE COURT: Well, I was going to maybe just pass on that until recess and you can look at that then.

MS. LITT: Okay, that's fine, thank you.

THE COURT: 500-YY is to Mr. William Hess.

"This is in reply to your recent letter requiring verification."

Is this the same idea that this was something that the Guardian's office who was trying to find out who was trying to find out about Mr. Hubbard?

MR. FLYNN: Yes, Your Honor, and I believe that is also a summary regarding his service and his medals which just on its face is a refutation of claims of Mr. Hubbard from the Naval Department.

THE COURT: All right, I will receive YY.

ZZ, are you familiar with these, gentlemen?

Why don't I take a recess and you look at these in this folder so you can know what I am talking about.

MR. LITT: Okay, thank you.

THE COURT: I will take a 10-minute recess.

(Recess.)

THE COURT: All right, we are back in session. Counsel are present.

4583

Going back to 500 double X, which is this group of records headed by this letter to Miss Cooper, Do you have any other objection to this?

MR. LlTT: Well I think the only thing additional, Your Honor, would be from reviewing the documents, two points, I think.

One in there is substantial medical records and the second is according to the correspondence there, the Navy Department treats all such documents as privileged, and that it would seen that privacy interests attach to them, therefore, would be of some significance. However, the court wishes to balance that.

THE COURT: Well, of course, the medical condition of Mr. Hubbard before and after the war are matters of apparent public interest as evidenced by the defense communications from people who apparently were being — one person there, Miss Patty Tossi is being solicited for membership and enrollment. She wanted to find out about Mr. Hubbard's war record and to find out more about the organization itself.

Apparently the medical records would seem to be contradictory of many of the claims that were made by Mr. Hubbard and also that were espoused by the organization at different times concerning Mr. Hubbard's medical condition at such times.

4584

Mr. Armstrong has indicated that these are all matters which he considered and felt were germane to defending himself should any legal action be prosecuted against him. And it seemed to me on balance that Mr. Hubbard has put his medical condition in the public arena.

And under the circumstances, considering the nature of the defense presented, I'll overrule the objection. They will be received.

MR. HARRIS: Just so it is clear, Your Honor, in the generalized objection, I don't know if I said it before, but in view of all that has gone on before we started trial, there would be a general relevance objection with respect to the defense. I assumed you understood that.

THE COURT: I deemed that. You have raised that in in limine motions. The Court ruled upon it. As far as I am concerned, you don't have to keep repeating those things. There is no reason to. I have ruled on it. The record is clear.

MR. HARRIS: That is all I wanted to make sure of, Your Honor.

THE COURT: 500-YY is already in.

ZZ regarding — is there any objection to this?

MR. HARRIS: None other than the generalized one, Your Honor.

THE COURT: It will be received.

AAA.

MR. HARRIS: A, B, C appear to be the same sorts of things, Your Honor, which — Naval records and other
than

4585

the generalized objection, no objection.

THE COURT: I'll receive those. Overruled.

DDD now is something from the ALGOL, a request for appointment to the military government.

MR. HARRIS: Right; the same manner of document, Your Honor,

THE COURT: Well, of course there was a reference to some biography.

Overruled. I'll receive that.

EEE is more Naval records. It is just really kind of — don't say very much.

MR. FLYNN: Which exhibit, Your Honor?

THE COURT: EEE. It is about a board of investigation that the Secretary of the Navy held, a matter of interest contained therein.

I guess if the Secretary of the Navy felt that there was a matter of interest, I guess it is not unreasonable that Mr. Armstrong thought there was something of interest.

I'll overrule the objection. It will be received.

FFF. This may be just duplicative of something else I had trouble reading before.

MR. FLYNN: That is what Mr. Armstrong testified to in the transcript, but that is a better copy of a previous exhibit.

MR. HARRIS: It is cumulative, Your Honor, of the one before this one. Which ever is the best copy.

4586

THE COURT: I'll receive FFF.

GGG is from Hubbard to Chief of Naval Personnel, request for orders wanting to go to LST'e for combat, 19 October, '43.

4587

MR. FLYNN: That was on chronology, Your Honor.

MR. HARRIS: Well, if it was just chronological, it is probably irrelevant, Your Honor.

MR. FLYNN: Well, as we saw from Captain Moulton –

THE COURT: Well, it puts him in some place at some time. I will overrule the objection. Be received.

Triple H.

MR. FLYNN: This relates to Mr. Hubbard's financial condition and the claim that he had $10,000 in the bank. These are the records. In one of those he says he is broke. He is not making enough to pay back the $265.

THE COURT: They didn't pay much in the Service back in those times. I will receive it in evidence.

Triple I, order of 10/1/42, relieved of command of the YP 422.

MR. FLYNN: There are documents in there relating to creditor claims, chronology.

THE COURT: Being transferred to Long Beach, Long Island for duty on 10/12/42. All right, I will
receive it.

Triple J, more of these Naval records.

MR. FLYNN: Triple I, J and K relate to all the same issues.

MR. HARRIS: Well may I see triple J, Your Honor?

THE COURT: Yes.

MR. HARRIS: I am using Mr. Flynn's exhibit list and it says something about unpaid uniforms.

MR. FLYNN: He had claimed to be a highly successful

4588

science fiction writer, a Hollywood director living in a posh New York apartment.

MR. HARRIS: You can spend money like a sailor in the Navy.

THE COURT; Most sailors do spend money like sailors.

MR. FLYNN: That is true, but not when you are supposed to have $10,000 in the bank account.

MR. HARRIS: Well, there's been various claims, Your Honor, with respect to the 10,000 being not in a bank account, and I'd submit that that is irrelevant.

THE COURT: I will receive it. It will be received.

Triple K is the Office of Censorship, 4/22/42, subject: Hubbard.

I guess it is to show he wasn't coming back on the Secretary's private plane, that they were trying to find a place for him in view of his disciplinary action in Australia. I will receive it in evidence.

Triple L. This is a letter from L. D. Causey with reference to unauthorized authority, attempting to perform duties for which he has no qualification. He is ordered to return to the U.S., not satisfactory and so forth.

All right, I will receive it.

MMM is enclosure of transcript of educational qualifications.

I guess this is some of his grades at Woodward Prep School. Placed on probation for deficiency in scholarship; September 1931.

I will receive it.

4589

Triple N, memoranda for the Chief of Bureau of Navigation regarding temporary orders for duty in the hydrographic office for about two weeks.

I gather this goes to his whereabouts at different times.

MR. FLYNN: Correct, Your Honor, and there is a notation in there about his trip to the inland passage of British Columbia.

THE COURT: Yes. I will receive it.

Triple O is State of Montana, Adjutant General's Office regarding service of Ronald Hubbard in the Montana National Guard. Attached is declaration regarding change of age.

MR. FLYNN: The key is the dates 1927 and '28 on the first page when he claimed he was studying with the Llama priests.

THE COURT: Well, they have frogs in Montana. I will overrule the objection. It will be received.

Triple P, we are getting — Triple P is from Pat — no, ML to Dear Pookey.

MR. FLYNN: This is more of the Guardian's office information.

MR. HARRIS: Perhaps I should take a look at it. Your Honor.

THE COURT: And the LAPD –

MR. FLYNN: What Mr. Armstrong testified to is that during the period of time when the Tompkins biography was being written, which has already been marked, Mr. Hubbard's

4590

personal recitation of his biographical data, the Guardian's office was collecting this information which showed what his Naval record was as opposed to what he represented it to be. Mr. Armstrong testified that the autobiographical notes for Mr. Hubbard were done in 1971 and '72, and they would have been delivered to Tompkins during that period of time.

MR. HARRIS: This is dated 29 October, 1981 and I don't think it could be referring to a Tompkins biography. It appears to be a stray, ditto correspondence and is irrelevant.

THE COURT: Well I guess the whole file is PPP.

I guess that is what it is, and it contains a number of things.

4591

MR. FLYNN: Right. He testified that there were biographical sketches which were published at the time by the organization with regard to the Naval background while they are getting information with regard to the truth about the Naval background; they contradict each other.

I asked him, "When you sent those documents to me what, if any, significance did it have on your mind as to whether the organization knew, at least in the mid-1970's about Mr. Hubbard's Naval background?"

He answered, "Well, I obtained these things. . ," And he says, "They came from Vaughn Young in the B-l area. At that point I realized that the organization hierarchy did know of Mr. Hubbard's Naval career."

He says, "I became aware that the people at the top of the organization did know and were aware of the misrepresentations."

He says, "I had not been up to that time because I didn't have access to those things, but only had Mr. Hubbard's Naval records."

THE COURT: Well, there is a statement:

"To whom it may concern, to the best of my knowledge a complete record of L. Ron Hubbard's Naval files is in my possession and a complete set of these records has been copied and given to a member of the Church of

4592

Scientology, Maria Delgado, May 1, 1979?; signed "Commander R. W. Walker."

There is an apparent inventory "re R Navy personnel file."

Well, there is a memorandum to CSG from MSH re LRH personal Naval records. "Dear Mary Sue" dated 3-8-76 signed "Rick."

There is a discussion of how they got the files.

I guess "Mike" would be Mike Douglas or Rick — this is another one from Mike. There is confusion as to who ordered the records and why they wanted them.

Apparently the Navy had first turned them down and they got a power of attorney.

4593

All right now that you have had a chance to review these, do you have any objection, Mr. Harris?

MR. HARRIS: General relevance objection with respect to those. Internal church memoranda and the like. First Amendment, I will try that one. How's that?

THE COURT: Well, whatever, I will overrule it. Be received.

THE COURT: Well, whatever, I will overrule it. Be received.[This was repeated in transcript.]

Triple Y, letter from Mr. Hubbard to the VA about a claim pending.

MR. HARRIS: He was seeking an eye examination.

THE COURT: Yes, any objection to that?

MR. HARRIS: None, other than general ones, Your Honor.

THE COURT: All right, overruled; be received.

MR. HARRIS: The categories S and T and U and V all appear — and W, X, all appear to be letters to the

Veteran's Administration, so probably could be handled by the general objection.

THE COURT: All right.

MR. HARRIS: In other words, 3R through 3X.

THE COURT: Any objection to those?

MR. HARRIS: Just the generalized one.

THE COURT: All right, be overruled. Be received. That goes up to X?

MR. HARRIS: Yes.

THE COURT: All right, those are in.

Triple Y is a folder. I have already received –

4594

well I don't know. What is in here that you are interested in? This is a big, thick folder.

MR. FLYNN: That traces the chronology during the whole period of the origins of Dianetics and Scientology, particularly with regard to the numerous letters from Mr. Hubbard in that file. I think if that is the right one with regard to his medical situation, his state of mind, where he was following the war, what he was doing, his consistent claims right up to 1951 seeking Veteran's Administration pension. He claimed that he had been crippled and blinded, but that within two years he had cured himself completely and that he was fully reclassified for full combat duty and had completely healed himself by '47, and that whole file traces his whole history during that period and refutes the claims that he made.

THE COURT: Oh, I am not going to receive this whole collection. If there are some specific things in here you want to talk about — probably an inch and a half of paper here. If there is something here showing –

MR. FLYNN: Maybe at the lunch break if we could have the opportunity go through it.

THE COURT: I am not going to get involved in trying to read all of those. That can remain for identification for the present time.

Triple S, the record of proceedings of a board of investigation.

I guess this was the first trial.

MR. FLYNN: That is the entire transcript of the

4595

board of inquiry.

THE COURT: That has to do with the shooting of –

MR. HARRIS: The Coronado Islands.

MR. FLYNN: Correct, Your Honor.

MR. HARRIS: It is irrelevant.

MR. FLYNN: Mr. Armstrong testified that the crew lied for him, and in those other handwritten notes he states that his crew during that board of investigation lied for him, and it is relevant to Mr. Hubbard basically claiming he is a war hero. He served four years in combat, and here is being removed from duty after this board of inquiry, removed from duty.

4596

THE COURT: Well, I am not going to receive this in evidence as such. This is just a trial transcript. Certainly, any testimony that Mr. Armstrong gave with respect to this particular exhibit will be considered as evidence in the case along with any other evidence that is developed. It was part of the record.

At this point I don't see any necessity for receiving this in evidence. It will remain as an exhibit for identification.

I see no necessity for it to remain under seal, however.

MR. HARRIS: If it is not received in evidence, Your Honor, I would assume that the seal would remain.

THE COURT: It is an exhibit for identification at this point. And exhibits that are marked for identification and not received in evidence are not ordinarily kept under seal. It would be very unusual for some exhibit to be kept under seal.

I see nothing unusual about this exhibit except it is irrelevant in its text. I see no reason why it should remain sealed. So ZZZ will remain for identification, but not sealed.

Quadruple A.

I would say the same thing with reference to that last one that I said I wasn't going to receive, two inches of paper, I don't see any reason at this point why it should remain under seal. It shouldn't be received into evidence.

500-AAAA, the letter from H. O. Kinkaid, medical

4597

consultant and attaching an order from the Under Secretary of the Navy, a copy of an order, not related to Mr. Hubbard, but just regarding uncompleted proceedings and findings of Naval Boards.

MR. FLYNN: This letter, Your Honor, Mr. Armstrong testified, I believe, is dated 1949 which is two years after Mr. Hubbard had claimed he had fully cured himself. And I believe here he is looking to upgrade his disability to 50 percent.
THE COURT: I'll receive it. The objection will be overruled.

Quadruple B, a letter from Mr. Hubbard to an adjudication officer. I assume this is the same thing; dated March 18, '46; it is in the similar vein. It has got an $11.50 award that he wants to appeal.

". . .my income from service connected injury is zero."

I'll overrule the objection and receive it.

Quadruple C is a letter from Mr. Hubbard dated 8-26-47, rehabilitation advisement; wants to go to the LA Conservatory, apparently; moving picture treatment composition arrangement; what is the relevance of this, just to show his status at that time?

4598

THE COURT: He is coming to Los Angeles apparently from Port Orchard, Washington.

MR. FLYNN: It related, Your Honor, to where he was going, where he was located and his condition at the time.

THE COURT: All right, I will receive it. Overrule the objection.

All right, we get now to exhibit 500 quadruple D through –

THE CLERK: 4C?

THE COURT: We just did 4C.

4D through 4I, portions of this have been read into the record and my disposition is to sustain the objection as to these exhibits coming into evidence.

However, those portions which have been read into the record are a part of the record and may be considered as evidence in the case, and these probably should remain under seal, at least for the present.

Do you want to address that, Mr. Flynn, or not?

MR. FLYNN: Just briefly. Your Honor.

We feel obviously, as Your Honor can see from reading them there, they relate to the personal attitudes of Mr. Hubbard and specifically relate to his view toward events in his past. We feel that since these were written during the period relating to the inception of Dianetics and Scientology, they are very significant with regard to his state of mind, particularly his state of mind relating to the fact that he claimed that he had been a Scientologist,

4599

done years of research, and that he had scientifically created Dianetics and Scientology, and that his background in science and his background with regard to absorbing the wisdom of Eastern philosophy, and his background in the Navy is relating in total to a highly successful human being in almost every area of endeavor that he had attempted at that point, who had only been crippled and blinded from war-wounds so as to prevent him from pursuing the highly successful careers in writing and the Navy and everything else that he had been doing, all of which led to the fact that he discovered Dianetics and Scientology to restoring himself to this highly successful career that he was embarked on. Those two factors taken together, his previous success in almost every area of endeavor, together with the war wounds having to be cured in developing Dianetics and Scientology to restore himself to this highly successful career that he was embarked on.

Those two factors taken together, his previous success in almost every area of endeavor, together with the war wounds having to be cured, and developing Dianetics and Scientology from that, was really what he sold for the next 30 years, and it is what he sold to thousands of people who paid, as the testimony has been, millions of dollars, relying on this picture, a picture of the man created in that way, a picture that is bigger than whether or not he was relieved from the PC 815, or whether or not he flunked out of George Washington University, or whether or not he didn't study under Llama priests.

4600

Those individual items may refute individual claims of Mr. Hubbard, but the overall picture that was presented to thousands of people who paid a fortune to this organization is totally contrary to the real picture.

The real picture is in Mr. Hubbard's intentions, his attitudes and his state of mind during 1945, 1946 and 1947, and the real condition he was in. These documents in his handwriting probably more than anything else relate to the type of person in reality Mr. Hubbard was. They specifically relate to the problems that he had, the serious psychological problems from which this organization has developed, which our view basically is that it is a schizophrenic organization.

The writings of Mr. Hubbard, we think, are basically schizophrenic. Every one of them, as noted by courts around the world, are subject to double meaning. For example, the fair game doctrine in itself is a perfect example of the double meanings that Mr. Hubbard incorporated into his writings, and that is the way we feel his mind was really at in 1946.

These documents reflect that, particularly where he is — without going into some of the specific statements –

MR. HARRIS: Please, Your Honor.

MR. FLYNN: — where he talks about himself in a realistic light and then at the same time he talks about how he is going to lie about the way he really is.

MR. HARRIS: That has been read into the record.

MR. FLYNN: So the significance of these documents

4601

to history, to people who really want to know, to people who, for example, Edward Walters, when he found out about L. Ron Hubbard being the type of person that was described to him by the Hartwells, he left the organization.

These documents reflect what type of person L. Ron Hubbard was. I recognize that they are sensitive. However, Mr. Hubbard's problems have been inflicted on the world from our view and he has inflicted his serious psychological disability on a lot of people who have been misled by him, and in that way we perceive Mr. Hubbard and we believe that society, when the overall story is told, will perceive Mr. Hubbard no different from Jim Jones, no different from other people who have misled groups of people into serious tragedies, and these documents reflect L. Ron Hubbard's mind as it really existed at that time, and I submit if the documents at least go into evidence but remain under seal, then at least Mr. Armstrong, even in defending this case, wherever this case goes, and the history of this case may not end in this courtroom.

4602

The significance those documents may have as a part of the record in the case, as a part of the evidentiary picture in the case may be far greater than I can currently envision. So if the documents, at least, went into evidence but stayed under seal for the present time until this whole thing is sorted out, I think that would be appropriate.

And I would add several other items or that they are currently — this may not really be immediately germane to this proceeding, but in the overall scheme of things with regard to how L. Ron Hubbard held himself out, I think it is germane; and that is that there is currently ongoing in Canada a major governmental investigation into Mr. Hubbard; in West Germany, in the United States. And a large part of the investigations have to do with not only misrepresentations about L. Ron Hubbard's background, but what his state of mind was at numerous periods throughout the entire Scientology organizational development. And they relate to abusive practices of the organization, financial manipulation and control and many of the items this Court has heard about.

For that reason, among all the other reasons, I think that it would be better if we admit it into evidence, but perhaps kept under seal until the overall picture is sorted out –

THE COURT: Well, counsel, I feel that this is not your fraud case that is on trial. We are trying here limited issues involving Plaintiff's charges, complaints against

4603

Mr. Armstrong. And I don't really see the necessity of putting these exhibits into evidence.

Frankly, I think what has been read into evidence has been permitted to be read is admitted and can be argued and is part of the record.

The fact that I choose not to receive it into evidence does not mean that they are to be discarded.

They are exhibits for identification and remain exhibits for identification in this case.

Certainly, if they have relevance to your cross-complaint, you'll have the opportunity to utilize them in your cross-complaint.

If some other public agency desires access to these particular records, there are ways that they can seek access to such records. But at least so far as the trial of this case, I don't feel that a great bulk of what is in there is relevant or material.

I think that the defendant's statements that he took these, believing that they would be of assistance to his defense, I think stands uncontradicted as it relates to these particular exhibits. And the Court will treat it that way.

If the plaintiff wants to contend that he shouldn't have taken these, assuming that the theory of the defense is a valid defense, then he can go into what was written down here. But at this point they haven't developed that. I would think they would probably not want to go into that aspect of it.

4604

So they really remain as exhibits for identification under seal. But I'll not receive them in evidence.

Quadruple J, LFH and John K. Parsons and Allied Enterprises.

This is a note to Omar Garrison, "We now have the source of the story Scientology gave the Sun Times."

What is this all about, Mr. Flynn? It has to do with some legal documents?

MR. FLYNN: There are many documents in there, Your Honor, that Mr. Armstrong testified about.

One was the document relating to Mr. Hubbard in his own handwriting claiming that he broke up the Black Magic ring. And the typewritten version of that is among those documents.

The documents relate to the fact that Mr. Parsons was the head of the Crowley Black Magic –

THE COURT: You are refreshing my memory now.

MR. FLYNN: — the Black Magic cult in the United States at that time. And these documents corroborate the fact that Mr. Hubbard was involved with Mr. Parsons and Mr. Hubbard was involved in Black Magic and that Scientology grew out of a Black Magic cult.

And the overall history of the OTO in 1946 to 1948 and Mr. Hubbard's involvement in it relates to his involvement with Parsons which relates to the documents before the Court.

THE COURT: He also has in here "Deratization exemption

4605

certificate." I don't know what the significance of that is except that they didn't have rats alive on board this boat.

"Diana," perhaps that is where Dianetics cane from, Diana.

Well, are there any comments you have, Mr. Harris or Mr. Litt, about this?

MR. HARRIS: With specific reference to the press release by Mr. Armstrong, Your Honor, as far as the rest of it, the generalized privacy and, apparently, some correspondence and various legal documents — I don't know.

MH. LITT: I would just add, Your Honor, that it doesn't appear that these documents say what Mr. Flynn wants them to say. So — they seem to be documents that show some connection between Mr. Hubbard and Mr. Parsons, I suppose, in some respect. But beyond that –

MK. FLYNN: In the overall biographical picture that was going to be written, Your Honor, it was of great significance to Mr. Armstrong and Mr. Garrison whether Scientology came from a Black Magic cult.

4606

MR. HARRIS: Well that certainly doesn't prove that, Your Honor.

MR. FLYNN: Well, in the overall picture of numerous other documents that are in archives, it does prove that.

THE COURT: Oh, I will receive it in evidence. Be received.

Quadruple K. This is the "Introduction to Blood Ritual. Comrade."

MR. FLYNN: That is part of the occult activity that Mr. Hubbard was involved in as opposed to being a scientifically validated, applied religious philosophy.

MR. HARRIS: This is a fairly straightforward attack. Your Honor, on the religion here, and I think that I am going to have to give the court some cases on First Amendment. Mr. Flynn just constantly states this. What people believe, they believe.

MR. FLYNN: Mr. Hubbard wrote letters disclaiming any involvement in black magic and the occult. His whole history claimed that he was not involved in the occult. That document is in his own handwriting relating to a blood ritual, relating to the occult.

MR. LITT: Your Honor, there is no evidence other than some statement from Mr. Armstrong that this relates to the occult. I suppose he things it does, but I certainly don't thinks the document on its face, you can tell that one way or the other.

MR. FLYNN: Your Honor, it is an invocation to Egyptian gods and it is among many documents –

4607

MR. LITT: The Egyptian god of love.

MR. FLYNN: It is among many documents, most of which Mr. Armstrong does not have possession of that are in the archives, that relate to this critical period in Mr. Hubbard's history when Scientology and Dianetics originated.

THE COURT: It appears to be an unpublished poem.

MS. HARRIS: That is what it appears to me, too.

THE COURT: Might become a best seller. I will overrule the objection. Be received.

In all probability, though, it probably will not.

Quadruple L. This has to do with the alleged daughter, Alexis Hollister, letters and communications.

Any particular objection to that, gentlemen?

MR. HARRIS: Yes, Your Honor. Extremely — relevancy, 352able at least.

What has that got to do with the Mr. Armstrong's defense?

MR. FLYNN: Well, Your Honor –

MR. HARRIS: I mean, it is personal matters having to do with familial relationships.

MR. FLYNN: Your Honor, there is great significance to these series of documents. The Guardian's office of the organization is handling the daughter of Mr. Hubbard who wants to meet with her father. There are three specifically important documents.

One is the letter from Jane Kember which is in front of Your Honor, the head of the Guardian's office.

4608

and she instructs Mr. Hubbard to simply deny even knowing the woman, and then Mary Sue Hubbard writes a letter saying it is much more sensitive than that, and deny that you are the father but admit that if the woman feels any connection to you, it is because you out of benevolence and humanity took care of her when the real father deserted Sarah Northrup in the 1950 period.

4609

L. Ron Hubbard writes that he is going to adopt the instructions of Mary Sue Hubbard and to have his instructions written out on a typewriter and taken and read to his daughter without giving her a copy of even what he has written out.

Other evidence indicates that Alexis is clearly his daughter. And to Mr. Armstrong, as he testified in this trial, that document had enormous significance on who Mr. Hubbard was and the type of person he was and the way the Guardian's office dealt with even Mr. Hubbard's own children.

Mr. Hubbard said in one of the documents that decency is a subject not well understood.

Well, that had a great deal of significance to Mr. Armstrong because he perceived that Mr. Hubbard was being uniformly indecent to his own progeny.

THE COURT: Anything further?

All right. I will receive it.

MR. LITT: May I make one comment, Your Honor, which it seems to me it would be appropriate to maintain a seal of that particular document. It does relate to personal or family matters.

THE COURT: It is in evidence; it is not going to be sealed.

The exhibit quadruple M, divorce proceedings LRH and Sarah Hubbard.

MR. FLYNN: This is almost all public record, Your Honor. And it all relates to the fact that Sarah and

4610

L. Ron Hubbard were the parents of Alexis; the treatment of Sarah by Mr. Hubbard; the public record. Again, this had enormous significance on Mr. Armstrong, particularly with regard to the creed of Scientology which relates to treatment of spouses –

MR. HARRIS: For the life of me, Your Honor –

MR. FLYNN: — the preservation of family relationships, what Mr. Hubbard held himself out as believing and the life that he lived as opposed to the real facts.

THE COURT: There is a letter in his handwriting to Sarah, ". . .my will is all changed. Alexis is going to get a fortune unless she goes to you as she would then get nothing."

Earlier he says, "Alexis is getting excellent care. I see her every day. She is all I have to live for."

MR. LITT: Your Honor, that note is the note that there was some discussion about the fact whether it was forged or not.

Mr. Armstrong, I believe, testified that although it didn't look like Mr. Hubbard's handwriting, there was something wrong with his hands at the time; maybe it could still be his or something like that. So I don't –

MR. FLYNN: He told her something about in order to get her daughter back, she had to write an affidavit.

THE COURT: I'll overrule the objection. It will be received.

Quadruple K is a divorce proceeding of LRH and Louise Grubb Hubbard, National Bank of Commerce versus LRH and

4611

Louise Grubb.

MR. FLYNN: The testimony was, Your Honor, that Mr. Hubbard had stated that he had been instructed by a Judge to get a divorce because his wife was a dipsomaniac and that he had gone and obtained the divorce which is totally false, as indicated by these records.

She divorced him. And among the correspondence between Louise Grubb Hubbard and L. Ron Hubbard during the late 1930's and early 1940's, it is clear that he wasn't supporting her and that Mr. Hubbard's claims with regard to her being the source of problems in the marriage and his divorcing her are refuted by these documents which are also part of the public record.

MR. LITT: Your Honor, it would seem that it is hard enough for divorce courts to figure out who is at fault in a divorce; I don't know that that really is much of an issue in this case.

4612

MR. FLYNN: Also documents in there with regard to the National Bank of Commerce in Seattle being owed money and Mr. Hubbard saying he had $10,000 in a safe deposit box.

In December 1945, as the other records indicate, he was living with Sarah Northrup in Pasadena, California.

THE COURT: Oh, I am going to sustain the objection under 352. Whatever he's testified about, it is in the record. It will be considered. I think we are just getting too many — remain as an exhibit for identification.

There is something written in here by somebody, marital status of L. Ron Hubbard. Is this something Mr. Armstrong put together or is it something somebody else put together?

MR. FLYNN: What is that, Your Honor?

THE COURT: I don't know. It says, "Marital status of L. Ron Hubbard and wife." It appears to have been written by LRH, was among his personal papers.

The note was written by Mr. Armstrong.

MR. HARRIS: Says "GWA."

MR. FLYNN: We will take a look at it. Your Honor.

THE COURT: That is the only thing there that appears to be of any nature that might require sealing. I don't know that it is authenticated in any way.

The rest of the records are just court records from other States.

MR. FLYNN: We'd offer that. Your Honor. We'd offer these two pages.

4613

THE COURT: Let me see it again.

Well, I am not going to receive it. There is really no authentication as to who wrote it, what their motives might have been.

What I am going to do, though, is the clerk will be directed to extract from the exhibit these pages' which are not the same size as the rest of the pages, and they will be sub marked as 500-4N-1. They will remain for Identification and be placed under seal.

The rest of the exhibit may remain as an exhibit for identification but not under seal. Just copies of court records.

500 quadruple O is a letter from Ron — I think it was read into the record that it was signed, "I do love you even if I did used to be an opium addict," signed "Ron."

MR. HARRIS: That was the relevance of it, Your Honor, and I think in the context of it Your Honor made a judgment at the time –

MR. FLYNN: In the overall context. Your Honor, Mr. Armstrong has seen numerous other documents in the archives relating to Mr. Hubbard's drug use.

MR. LITT: Well, unfortunately I don't remember any such testimony.

4614

MR. FLYNN: There was testimony –

MR. HARRIS: This appears to be a letter between man and woman, Your Honor. It shouldn't be for that reference.

THE COURT: Well, I don't think I'll receive this into evidence. I don't know. It is hard to tell what it is supposed to represent.

MR. FLYNN: Mr. Armstrong testified that Mr. Hubbard has held himself out as being antagonistic to drug use, including the period into the 1950's when Scientology and Dianetics were being developed. And the overall records and documents show that he was involved in drug usage throughout that period of time.

MR. HARRIS: That isn't what they show, Your Honor.

THE COURT: This was written when he was in the service in January of '45. And, you know, I don't know what it means, really, whether he would have been an opium addict. He may well have been. I'm not saying he wasn't. It may have been something he was writing in jest, you know, of his wife. I don't know.

MR. HARRIS: The Court earlier ruled on it. There is a reference here. I don't know whether it is allegorical or what it purports to be.

It is, ". . .1 do believe you, even though I used to be an opium addict."

Other than that, I don't see where it has a lot of relevance exactly.

MR. FLYNN: That is in the record.

THE COURT: What is in the record is in the record.

4615

I won't receive it. I'll let it remain sealed.

500 quadruple O will be kept as an exhibit under seal. What is in the record will be in the record.

500 quadruple Q; it is another one of those voluminous — well, it is a time chart.

MR. FLYNN: Guardian's Office time track on his first born son. And Mr. Armstrong testified at length that he was appalled by the Guardian's Office's activities against L. Ron Hubbard, Jr.; that he felt that Mr. Hubbard had created all the problems between him and his son with the use of the Guardian's Office activities against him.

Again, it went directly to Mr. Armstrong's state of mind with regard to the way Mr. Hubbard treated his own children by having the Guardian's Office conduct operations against them.

It also shows the way the Guardian's Office operated which became an issue throughout this case. And it continues to operate right up to the time of what they did to Mr. Schomer.

MR. LITT: Actually, what the time track shows, Your Honor, is that L. Ron Hubbard, Jr., apparently, had something of a vendetta against his father, if you actually read it, and went to many places and did many things to attack him. I don't know that all of this has too much to do with the case.

THE COURT: I'm just concerned about maybe his son's right of privacy.

Well, I guess I'll make an exception here on

4616

this. I'll receive it in evidence, but order that it remain sealed. I don't Know how many pages are here, over an inch of documentation of activities, I assume, of the son. The son is not here to protect his interest. And he certainly has no stake in this lawsuit. He is not an intervenor or anything.

I'll order that it remain sealed to protect his rights.

It is in evidence.

All right. Quadruple R.

MR. FLYNN: This was designed to show that L. Ron Hubbard was not even receiving the letters from his own son; that responses were being written by someone else in connection with what they called the SO1 line which L. Ron Hubbard had said that all mail addressed to me will be received by me and responded to by me.

MR. HARRIS: It doesn't say that at all, Your Honor.

MR. FLYNN: That was the representation that was held out to Scientologists for years, Your Honor.

MR. LITT: It is typical of Mr. Flynn. It is Standing Order No. 1, Your Honor.

MR. FLYNN: And here he is having his own son's correspondence handled by someone else. And Mr. Armstrong testified that this had a significant impact on him.

THE COURT: I'll receive it.

Quadruple S has to do with a trip to Puerto Rico.

MR. FLYNN: Mr. Hubbard claimed that he had done a complete mineralogical survey of Puerto Rico and that is a

4617

representation that is made in numerous biographical sketches. And these documents relate to Mr. Hubbard's being on the island of Puerto Rico in connection with the Red Cross Mission and together with numerous other documents that are in the archives, as Mr. Armstrong testified, show that the claim that he had done a complete mineralogical survey of Puerto Rico was false and that he had actually gone there to find gold, as set forth in the documents before you, Your Honor.

It is part of the overall picture of holding out Mr. Hubbard as a scientist, an anthropologist.

THE COURT: Any further objections, gentlemen?

MR. HARRIS: None other than the generalized one, Your Honor, except that it is so voluminous, I imagine some part of it could show what Mr. Armstrong wants it to show.

THE COURT: I'll receive it. I'll overrule the objection.

Quadruple T, a letter to "Dear Rick" 3 March, '60.

". . .all releases and statements, make sure you stress that I worked in the field of nuclear physics on life sources and life energy; combat getting me labeled as a psychiatrist and spiritualist. This will take some doing, perhaps, but I am a research man, not a practitioner."

This is a direction to some PR people about something.

4618

MR. FLYNN: Mrs. Hubbard testified, Your Honor, admitted that he was not a nuclear physicist.

Here in his own handwriting he says he works in the field of nuclear physics and that together with other documents that are coming up together with past documents show that he was holding himself out at different times in different ways.

4619

THE COURT: Signed by Dr. Hubbard. All right, I will receive it. Overrule the objection.

4U. "I was not the instigator of any … — founder refers to just founding Dianetics and Scientology."

I am not sure. I may not be reading this right.

"I was not the" — something — "instigator of any Dianetics and Scientology Orgs. Founder refers to just founding Dianetics and Scientology. Even the status of church was by vote of Scientologists. We just … and the idea of orgs was …" –

MR. FLYNN: It says, "The first foundation and idea of organizations was entirely that of other people."

And then we put that together with the next exhibit, the letter to Helen O'Brien where he says, he is talking about:

"We don't want a clinic. We want one in operation but not in name. Perhaps we could call it a spiritual guidance center. I await your reaction on the religion angle. In my opinion we couldn't get worst public opinion than we have had or have less customers than we have with what we have got to sell. A religious charter would be necessary in Pennsylvania and New Jersey to make it stick, but I am sure you could make it stick."

Those two documents taken together show there he is saying in 1980 or '81 during the IRS investigation that

4620

he didn't originate the religious idea in Scientology orgs, and his early correspondence shows that he was the one that was behind the religious angle.

MR. HARRIS: Your Honor, this document in Mr. Hubbard' handwriting, or maybe it isn't even in his handwriting, doesn't appear to be dated, and the other one is very clearly First Amendment, the beginnings of the religion. Your Honor. "We are treating at the present time beingness. Psychotherapy treats the past and the brain, and brother that is religion, not mental science."

MR. FLYNN: The testimony. Your Honor, is a note which has been taken down by a messenger. I am not sure which messenger's handwriting this is, but it was in the format in which notes were taken down in longhand as Mr. Hubbard dictated.

THE COURT: Oh, I will receive it. No question that we are not going to pass upon the merits of any of this as a religion.

He did indicate in 4 double V considerable interest in money.

"If we were able to return there" — that is Phoenix — "we'd be able to count on 10 to 15 preclears per week at $500 for 24 hours of processing. That is real money. I have seen it happen before. We get more preclears at $850 per week intensive. Charge enough and we'd be swamped. We need that money. Me should not long plan to have it siphoned away."

4621

I don't think that is First Amendment.

4U and 4V will be received in evidence. 4W, Minister of Health, Muster of Health, Master of Health; with all proper names, titles and forms of addresses.

What is this all about?

MR. FLYNN: All right. Here Mr. Hubbard states that they are preposing a program of units in the field of mental healing and mental science. In earlier documents which have already been introduced into evidence, Mr. Hubbard said that he was not working in area of mental science, and he calls Scientologists in that document psychiatric practitioners, He had earlier stated that they were not involved in mental healing. Here he claims that that is what they are doing.

The exhibit V which has been admitted into evidence with a note to Rhona in which he said he was an author not a mental practitioner, and here he says precisely the opposite.

THE COURT: Any particular objection, Mr. Harris?

MR. HARRIS: Same as I have made before. Your Honor.

THE COURT: All right; overruled.

"We have on our rolls upwards of 2,000 trained psychiatric consultants devoted to the psychiatric schooling of Scientology. These practitioners have as much or more than 2,000 classroom hours a piece devoted to the theory and practice of mental healing." Be received.

4622

THE COURT: Quadruple X, a letter to the Honorable Howard Pyle, Deputy Administrator; President, the White House; by "Dear Governor."

MR. FLYNN: The same thing, Your Honor. He is making claims that he can raise the intelligence quotient of scientists engaged in defense work; that he can reduce the reaction time of fighter pilots; making scientific claims.

THE COURT: Well, there are a number of other documents here also.

MR. FLYNN: I think that also shows that it was originated by Mr. Hubbard and was to be written in someone else's name.

THE COURT: There is a list of names; there is "HCA, pre-clears."

All right. Any other objections?

MR. HARRIS: May I see it briefly, Your Honor?

THE COURT: A return letter from Mr. Pyle.

MR. HARRIS: Other than the general one, no.

THE COURT: It will be received.

Quadruple Y, "Notes on suits, medical treatment for shock and psychotics."

Commenting upon Winter's book; defining Dianetics as a science; a Time article.

What was this all about?

MR. FLYNN: Your Honor, this document, Mr. Armstrong considered to be extremely important because it showed that he was lashing out at anyone who was critical of him and he refused to accept any responsibility for the fact that under

4623

Scientology treatment people did go crazy.

He said that he is not a science fiction writer, but an adventurer.

He says that in reference to science fiction being a science fiction writer, "I am not one, but my forte was adventure writer." And, of course, there are other publications that he was a science fiction.

So Mr. Armstrong, in connection with all of the claims that Mr. Hubbard had been a science fiction writer, when he finds in Mr. Hubbard's own handwriting saying he wasn't and then lashing out at people in the medical profession, it indicated to Mr. Armstrong that Mr. Hubbard had severely imbalanced perceptions of himself. And he so testified.

THE COURT: Okay. Any further objections, counsel?

MR. LITT: Just, Your Honor, that I mean I don't think there has been any question that Mr. Hubbard wrote both adventure and science fiction stories, I guess he is characterizing in his letter what he thinks was the main thing. And I don't think Mr. Armstrong has ever said otherwise, nor do I think that if Mr. Hubbard has opinions about the psychiatric and medical use of shock treatment, that that has anything much to do with anything. I don't think it is particularly relevant.

THE COURT: I'll receive it for whatever value it nay have.

What about quadruple Z which is the proposed settlement agreement? I guess it was an agreement that

4624

Mr. and Mrs. Hubbard signed at one time. I think it was offered only at the time — I have forgotten. It was not a valid contract under California law.

MR. LITT: That is correct, Your Honor.

THE COURT: I'll sustain the objection. I'll order it to remain an exhibit under seal.

We'll take a recess until 1:30, We are just now about to get into the 5-series.

(At 11:55 a.m., a recess was taken until 1:30 p.m. of the same day.)

4625

LOS ANGELES, CALIFORNIA; WEDNESDAY, JUNE 6, 1984; 1:32 P.M.

oOo

THE COURT: All right, next, we have identified as 5A's, LRH written dispatches to Mr. Diomedes in Greece. What was the necessity for all this?

MR. FLYNN: This relates to the fact that Mr. Hubbard had claimed that he bad resigned his management, direction and control of Scientology in 1966, and here he is negotiating with this Mr. Diomedes, whatever his name is, to establish a Scientology company in Greece. He had also claimed that he did not receive his 10 percent. There was extensive negotiations in the documents regarding getting his 10 percent, and they are dated, I believe, from November '66 through some time in 1967, and his resignation, which is also under seal, is dated March 1966.

4626

MR. FLYNN: What he was doing in those documents, Your Honor, was setting up the structure by which he could skim 10 percent off the top of the organization.

4627

MR. HARRIS: I haven't had a chance to go through all this, Your Honor, but it appears to me that judging from a couple of the items in here that Mr. — I am going to have difficulty with his name, Diomedes, transmitting information to attorneys with respect to companies being formed and the like, letters en route to you describing full operation of the company, vital data for your next solicitor, so I will assert attorney-client privilege in respect to all those documents, in addition to the general ones.

The subject matter appears to be that as well.

THE COURT: Well it is certainly not very clear that that is involved in this series of letters, so I will not sustain that privilege.

At the same time, I am — Mr. Armstrong's testimony will stand and I will just let these remain for identification. I don't see any reason to get that group, 100 pages or so into evidence. The witness has testified as to what his opinion of it is, what it was, what its significance was to him.

500-5B is NAAPA. I don't know what that is.

MR. FLYNN: Your Honor, it is the National Academy of American Psychology. Mr. Hubbard was trying to set this group up, and he has expressed antagonism and antipathy for over 20 years to psychiatrists and psychologists. He was attempting to use this as a front organization, and it also relates to the fact that he had claimed that he was not a mental health practitioner, and here is trying to set up this

4628

academy as a front group for his own — for his Scientology organization; another example where he says one thing and he does another.

THE COURT: Well he was going to have stamps like the TV stamps that come out at Christmastime, "Send in your contribution to help the mentally ill," I don't know whose writing that is.

MR. FLYNN: It is all Mr. Hubbard's, Your Honor. There are also documents in there that he prepared for someone else's signature.

He has said in prior exhibits that he did not want to be determined to be practicing in the field of mental healing and mental health.

2629 [4629]

THE COURT: A loyalty oath and something that was sent to the ministers wanting them to join.

MR. FLYNN: Mr. Armstrong testified that it was an attempt to gain control of the field of psychology by infiltrating it with this front organization.

MR. HARRIS: I doubt that this organization would have infiltrated psychiatry, Your Honor.

It does seem like Mr. Hubbard is attempting to put together a group and that it does have a loyalty oath and other sorts of things in here.

This is the era of the early '5O's. And loyalty oaths and those sorts of things were around.

MR. FLYNN: I think it is the late '5O's, Your Honor.

THE COURT: I don't know if you have seen this. This is "Loyalty oath of mental practice." "I hereby subscribe to the following code of ethics and practice and swear to abide by it at all times:

"Those who sign and return the oath are declared safe. Those who ignore or refuse to sign it before witnesses are listed by the NAAP as potential subversive. Those who rail against it are listed as subversive."

It goes on, "These three groups of names collected in Washington at the main office are then to be submitted to government contacts established by the NAAP and further official action will be taken. One of the people most

2630 [4630]

interested in such a program is Vice President Nixon."

"It will be seen that only persons not schooled in the ways of foreign ideology would sign this oath."

"Thus it can be seen that this simple program carried out on a basically clerical level could not do otherwise than mop up psychotherapy, leaving some public trust."

"Since the NAAP already has the credentials of Scientologists and Dianeticists, a verification of their credentials can be done for $25. All others, in that they must be examined and must present evidence that they have actually helped people, will be charged $80.

"Membership in the academy is without charge.

"Membership numbers will talk. Anyone can be a member. He only needs to sign the loyalty oath before witnesses.

"We will wind up with, one, the largest membership mental health organization in the U.S.

"Two, a clean mental practice field into which Scientology can move.

"Three, a U.S. less liable to subversion.

2631 [4631]

"This program will save tens of thousands of lives per year.

"This program is yours. You furnish the action. One, join the KAAP. Two, write for a packet of loyalty oaths and membership organizations. Three, ship them out. Four, return your lists to the NAAP the, signed oaths and the names of those who ignored it or who refused to sign it.

"For funds, postage, printing, pass the hat."

MR. FLYNN: Mr. Armstrong testified that in the loyalty oath that is a loyalty oath which is prepared and steps of reporting people who do certain things to the FBI in an attempt to gain control of the field of psychology.

THE COURT: I can see he was upset with this shock therapy. And I can understand why any person might be revolted by electric shock therapy.

MR. HARRIS: Well, Your Honor, I think it is cumulative and a great mass of materials in respect to an organization which, apparently, never got off the ground.

4632

THE COURT: Well it is some evidence of his modus operandi and his thinking and Mr. Armstrong's reaction to it. Even at that date he was developing lists of good guys and bad guys, with the emphasis apparently on the bad guys. I will receive it in evidence. 500-5C's, I don't know what this is. Oh, these are these two tapes that relate to the attorney-client privilege.

MR. HARRIS: Yes.

THE COURT: I am not going to receive these in evidence, but I want to make it clear for the record that I have not specifically ruled on the invocation of the attorney-client privilege as it relates to the sort-out operation. I did tentatively sustain the claim of privilege as to everything that happened after a certain date. I recall that, but the court has not passed upon any assertion by the defense that for other reasons there might not be a valid privilege.

MR. HARRIS: Will that remain sealed?

THE COURT: Yes, that will remain sealed. Nobody can look at it and read it anyway.

MR. LITT: Your Honor, can I just have that clarified?

THE COURT: I wouldn't want anybody to say that well, by reason of res judicata that I have ruled upon Mr. Flynn's claim, that that may not be privileged because of either a fraud, crime, exception to the attorney-client privilege.

He hasn't presented any evidence on that subject other than what has been presented and I haven't ruled upon

4633

it, and there was also some discussion about what Laurel Sullivan or other people night be able to testify from personal knowledge of records and documents and so forth, which again was not presented, so I just don't want any contention made that this court has precluded Mr. Flynn in any subsequent trial of his cross-complaint from going into that issue if he feels it is appropriate.

MR. HARRIS: No, that is not a concern. Your Honor, but what is a concern is that the case before Your Honor has ruled, which if Your Honor is forced to may rule in favor of the privilege, being available to anybody at this point until such time.

THE COURT: Well I have already ordered it sealed.

MR. HARRIS: Yes, but that may not be complete enough.

I think you should say it is presumptively attorney-client privilege, We are not going to say it is res judicata.

MR. FLYNN: Your Honor, I'd like to be heard on that.

THE COURT: I think I am going to have to — right now anything that is under seal is subject to prior order of this court regarding how they may be viewed as a regular procedure that is set forth, and that order is going to exist until I do something else, and any order that I make will be included in any judgment in this case. So I don't really think it is necessary to do anything more than that other than to make it clear that the previous orders that were issued by Judge Cole are still in effect as they relate to any exhibits which are under seal.

MR. FLYNN: Your Honor should be aware of exactly why

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this is a matter of concern to Mr. Harris and Mr. Litt. There is currently a proceeding going on in Toronto with regard –

THE COURT: I don't want — I really don't see that it is necessary to get involved in it. I am saying that I am not making any ruling upon your contention that the privilege is vitiated or that there is not other evidence which would be non privileged. It is just at this point not going to be received in evidence and it will remain under seal as an exhibit for identification.

MR. LITT: Your Honor, can I just clarify one thing for my own understanding?

When the matter of the tapes first came up and we presented a declaration to the court, my recollection is that this court said that we had made a prima facie claim of privilege. I recognize that the court is not saying thereby that it is ruling on whether there is an exception to the privilege, but –

THE COURT: Well I did presumptively find that they were privileged. There were attorneys present. There were apparently several cases in California which would indicate that, assuming that everything is as it was supposed to be, that that would be privileged.

MR. FLYNN: Your Honor, the problem with that notation is that Mr. Armstrong did do an affidavit in connection with the tapes. That declaration has been filed in numerous cases. It was also filed in Toronto with regard to the search warrant. The issue with regard to the admissibility of that

4635

affidavit in the search warrant proceeding is now currently now being litigated right this moment, and the contention has been made in Toronto, from what I understand of the phone call this morning, that Your Honor has ruled that the tape is protected by the attorney client privilege.

That contention had been made by the attorneys in Toronto.

THE COURT: I don't see how that could fly because the State, the government of Canada is not a party to this action.

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It seems to me that the validity of that seems it ought to be capable of being challenged up there in whatever forum, whichever way. Because, certainly, I assume it is brought by the government of Canada. They are not a party to this action.

Why should they be bound by what happens here?

MR. FLYNN: The tapes are here, Your Honor. And the representations are being made that the adjudication with regard to whether the tapes are protected by the attorney-client privilege in this court would affect the validity of the warrant because of Mr. Armstrong's affidavit.

I would also point out to the Court that in exhibit 7 the Church of Scientology authorized by the board of directors of the Church of Scientology of California authorized Mr. Armstrong to give legal papers to Mr. Garrison.

THE COURT: Well, I don't think that would constitute of waiver of any attorney-client privilege on these tapes.

It is plain to see that these, apparently, came into the hands of Mr. Armstrong without anybody's awareness that they had not been erased. And I just think that — I'm ruling on what is before me. I am not ruling on what was happening in Canada, China, Mexico, or any other spot on the face of the Earth.

And, certainly, as far as I am concerned you are free to litigate that in your cross-complaint if it becomes something of importance in the trial of the cross-complaint. So I don't see how anything that I do is going to affect what

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they do up in Canada.

MR. FLYNN: So as I understand the present state of the record, you have not ruled on the applicability of the attorney-client privilege to the MCCS tapes?

THE COURT: I have tentatively ruled that they are covered by the privilege.

I have not heard evidence; there has been no evidence presented that the crime fraud exception applies. I have not ruled upon that aspect of it. I haven't ruled upon any testimony that, for example, Laurel Sullivan or somebody else might be able to give concerning what happened during the MCCS sort out based upon records or documents that were in existence that would have been available to anybody through discovery that they became aware of.

There is case law in that regard. I am only ruling that I am not receiving these in evidence in these proceedings, and, at least, on what is before me that presumptively the conversations would be within the attorney-client privilege. For whatever it is worth, that is what I am doing.

Five D's is the Val Doc inventory.

MR. FLYNN: Your Honor, in that connection, may the affidavit of Mr. Armstrong, which I previously submitted to the Court, be marked for identification?

THE COURT: Well, I don't know. We have got so many documents, so many affidavits, I don't know where these affidavits are.

Why have it marked? What is the significance

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of it?

MR. FLYNN: Well, in connection with the appellate record, it has not yet been marked for identification. So if the case goes up on appeal, the transcript –

THE COURT: Let's do this first and then we'll make a note of it and come back to it. LRH Val Docs.

MR. FLYNN: The significance here, Your Honor, is that the undated resignations at the back were all
listed.

THE COURT: This has to do with the idea of control by Mr. Hubbard; is that it?

MR. LITT: Your Honor, the Court should note, if my recollection is correct, that if you look at the table of contents, you'll see different kinds of Val Docs. And it just says "Organization Val Docs," not "L. Ron Hubbard Val Docs."

So I don't know that there is any inference to be drawn.

THE COURT: Well, I suppose it establishes that there is such a procedure and, apparently, it was followed here; probably 25 organizations that are listed with their resignations in blank.

I suppose it is two pages of it. The rest of it is just a lot of paper.

MR. FLYNN: Except for those pages. It is just those pages of the undated resignations that we are concerned about, Your Honor.

4639

MR. HARRIS: Wherever they are.

THE COURT: That is where they are.

MR. FLYNN: That is kind of symptomatic of many of them. When it was sent to my office, Your Honor, it was sent in a black binder. The significance was the undated resignations, but they were all incorporated into one binder.

MR. HARRIS: Apparently there is only one page.

THE COURT: July is on the second page.

MR. HARRIS: All right. Well, as to those, if undated, Mr. Armstrong testified respecting that that he wasn't sure when it was. Might be 3 September, '66 or whenever the resignation occurred, but in any event, if that is all it is being offered for, no objection other than the ordinary ones. Sub marked?

THE COURT: I am just wondering whether we should try to extricate it from the rest of it. Maybe it should stay where it is, just paper clipped and sub marked as whatever it is, sub 1, and receive that and not the rest of it.

MR. HARRIS: Very well.

THE COURT: It is D, I guess, 500 five D's, sub 1. You could probably just Xerox those two pages.

MR. HARRIS: Very well.

THE COURT: It is D, I guess, 500 five D's, sub 1.

You could probably just Xerox those two pages.

THE CLERK: I can.

THE COURT: Then we wouldn't put the whole thing in.

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Just Xerox those two pages. That will be received and the rest will be received for identification but unsealed.

We have a whole lot of papers here now on five E's, organizational contribution.

MR. FLYNN: These relate to the Hubbard Explorational company. Your Honor, and Mr. Armstrong testified that he considered these documents were very important because they showed that although Mr. Hubbard ad supposedly resigned in 1966, he continued to exert control over Scientology and over Scientology personnel and he established HEC, Hubbard Explorational Company, as a vehicle by which he could control through a profit corporation Hubbard Explorational Company. There are documents in there relating to, I believe if that is the right file, bank accounts, transportation of moneys, LRH goodwill repayment account, Hubbard ordering and establishing a goodwill repayment account. "Mr. Hubbard is to be repaid for his goodwill."

He writes, "An org that doesn't comply must have his executive sec changed."

This is all after his resignation. "If doesn't deposit, must have his deposit and treasury sec changed as this indicates refusal to give LRH money, and that they are stealing it or at least not on our side."

MR. HARRIS: Well, it seems to me a mixed bag. Your

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Honor.

THE COURT: Probably is.

MR. HARRIS: There is apparently a charter party agreement between HEC and Church of Scientology of California, and there are some HEC documents and then there is a number of items.

MR. FLYNN: Our view, your Honor, is that the overall pattern of control went from HEC, OTS, OTC, RRF to ASI.

THE COURT: Where does LRH fit into it?

MR. FLYNN: And today Author Services Inc. is no different than HEC was in 1967.

MR. HARRIS: Well, that is a nice collapse of everything into thing, one big ball of wax. Your Honor. I think the sheer weight of the exhibit ought to forbid it going into evidence, meaning heaviness as opposed to relevance.

There do appear to be financial transactions in there, Your Honor, which are presumptively private and some that aren't.

MR. FLYNN: These documents all dispute, Your Honor, the claim that he wasn't receiving moneys from Church of Scientology of California and other Scientology organizations.

MR. HARRIS: Well, HEC was certainly, if there was a charter party agreement between Church of Scientology of California, defendant testified he didn't see any dividends and the like in respect to that, Your Honor.

MR. FLYNN: The file is filled with undated letters of resignation, Your Honor, promissory notes, financial

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transactions.

THE COURT: Well, "re 50,000 pounds you just transferred to Swiss. Let it ride along as it is and I will submit bills and transfer for use. HBC will have a beautiful building for base one to rent C of S. Love, Ron."

This is dated August 25th of '67.

I will receive these in evidence. It is pretty obvious what they are and what they purport to be.

Five F's, is this more of the same?

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MR. FLYNN: I believe that is an example of Mr. Hubbard saying send an undated letter of resignation. Cancel third church. Send undated letter of resignation.

MR. HARRIS: Seems to be cumulative by now.

THE COURT: It is more than that. It says, "Send me undated resignations of trustees for Church of Scientology and American Science, one for each church. I will hold resignations against good behavior. Then hold trustees meeting authorizing bank accounts, seals and bylaws. Open account on my signature only. Run big notice in 24-G that fourth Clinical Course to be Phoenix February 15/April 1."

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MR. HARRIS: Pre-1966, Your Honor.

MR. FLYNN: Pattern of control, Your Honor.

THE COURT: Well, I'll receive it.

G is legal memorandum concerning the state of Scientology companies, the office of L. Ron Hubbard.

MR. HARRIS: It doesn't have a court file stamp on it, Your Honor. I would claim attorney-client privilege in respect to it; work product as well.

MR. FLYNN: Your Honor, Mr. Armstrong testified about the notation that all previous U.S. organizations were Dianetic organizations and were not owned or controlled by Dr. Hubbard.

Mr. Armstrong testified that there was obviously extensive documentation which refuted that.

MR. HARRIS: May we have a legal opinion here that Mr. Armstrong's lay opinion is incorrect, Your Honor?

THE COURT: Well, it obviously speaks only of 1963 or before. It doesn't — I don't really know what the significance of this is.

It says "legal memorandum" up at the top.

MR. FLYNN: Your Honor –

THE COURT: This is in the record of the Church of Scientology of California.

MR. HARRIS: Your Honor, Mr. Hubbard's personal items were also in the records of the Church of Scientology of California. And it appears to be –

THE COURT: They were available to anybody that was an archivist or anything else that was there.

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MR. HARRIS: Who had a trust and the like, yes, Your Honor. That is true.

MR. FLYNN: Your Honor, the documents, many of the documents already in evidence and coming up all show that statements made in that document with regard to control are false.

THE COURT: Well, I don't know. I'll just sustain the objection to 5 G's. It may be privileged as work product or something.

It will remain under seal because there may have been a privilege attached to it.

Five H's is a resignation of trustee. Is there any objection to that?

MR. HARRIS: No, Your Honor.

THE COURT: It will be received.

Five J's is entitled "Top Secret."

MR. FLYNN: 500-I, Your Honor?

THE COURT: Do we have 500-I?

500-I is entitled "Reorganization" –

MR. LITT: I think there has been a ruling on this document, Your Honor, that it is privileged.

THE COURT: I remember now. These are the letters to Oscar Brinkman. I held that those were privileged; apparently, communications to his lawyer. I'll sustain the objection.

MR. FLYNN: May I just note for the record at this point that exhibit 7 did authorize Mr. Armstrong to give those documents to Mr. Garrison.

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THE COURT: Well, I am not going to change my position. What about this conference arrangement, five J?

MR. FLYNN: Mr. Armstrong testified that this indicates that Mr. Hubbard is hiding rather than in
seclusion.

This is a pick-up project participated in by Kima Douglas to pick-up an individual and go through various stops and –

MR. LITT: There was no such testimony from Mrs. Douglas as far as I know, Your Honor.

THE COURT: Nobody asked her about it.

MR. FLYNN: She is named in the document, Your Honor.

MR. LITT: The document is dated January 23rd, 1978 which was before Mr. Hubbard went into seclusion, Your Honor.

I don't know that that has anything to do with anything as to his being in hiding. All it shows is security arrangements. It does not seem to me that it has –

MR. FLYNN: Mr. Armstrong –

MR. LITT: May I finish, please?

It doesn't seem like it has anything to do with anything of much significance in this case.

MR. FLYNN: Mr. Armstrong testified at length, Your Honor, about all the precautions that were taken in 1978 at La Quinta with regard to process servers, guards being posted.

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THE COURT: Well, just corroborative of his testimony. I will overrule the objection. Be received; J's will be received in evidence.

K's.

MR. FLYNN: 5K and L, Your Honor, are deemed to be important because the orders of L. Ron Hubbard, the church is paying the legal fees for the criminal defendants.

THE COURT: Are these supposed to have been authored by Hubbard?

MR. FLYNN: Yes, Your Honor. I believe there are asterisks at the bottom which indicate L. Ron Hubbard. There's been testimony to that effect.

MR. HARRIS: Looks like transmittal of information to an attorney. Your Honor, and instructions with respect to the same. I claim attorney-client privilege with respect to that document.

MR. FLYNN: Is it being claimed for Mr. Hubbard who is not a party. Your Honor?

MR. HARRIS: Well, it can be claimed by anybody on behalf of an absent person, yes, and I am claiming
it.

MR. FLYNN: That is simply not so, Your Honor. The person has to come forward and assert it himself.

MR. HARRIS: Well, I'd suggest Your Honor could direct Mr. Flynn to the Evidence Code of California and particularly sections 913 et seq.

THE COURT: I don't know that K is to an attorney. Is there something that comes after the "legal:" I assume there isn't.

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MR. HARRIS: No, just "legal." Transmitting information to attorney or back and forth, one or the other.

THE COURT: Apparently is directing somebody, legal affairs officer. In other words, is he directing this to somebody in their legal department?

MR. FLYNN: it is someone inside the organization.

MR. HARRIS: Well I don't know that that is the case or not, Your Honor. 1 don't have any actual knowledge of it, but it doesn't look like the sort of address mechanism that is used internally in the church, as Your Honor has seen enough documents by now.

THE COURT: 5L does appear to be a communication to a law firm. I assume that it is confidential information.

Well, I will sustain the objection to K and L and they will remain sealed; attorney-client privilege. Some question about it.

I have got 5M here. Also says something about legal no solution. Destroy when read. Somebody didn't follow orders apparently.

Well I would overrule the objection on this one. This might on its face appear to be privileged, but he is talking about a strategy, the most unwanted witness, and I think this would be criminality or fraud.

MR. LITT: Your Honor, if I may, it appears to me that this is a letter from Mr. Hubbard to Mrs. Hubbard, and it is obviously –

THE COURT: How do you draw that conclusion?

MR. LITT: I draw the conclusion from the fact that

4649

in the last paragraph he says, "As I do not know your exact position, I could not know and could not advise any specific strategy for you."

And it appears that he is referring to an attorney who he consulted, but he represented Mrs. Hubbard, which was Leonard Baudin, which is the attorney that the previous letter was addressed to, and it appears to me that what this was was a communication to Mrs. Hubbard that was obviously intended to be communicated to her and then destroyed. I do not know why that did not occur. I don't know any of the circumstances of it.

THE COURT: I am not going to draw any conclusion to that effect. There's been no testimony to that effect in this record, and the party had opportunity to testify if they had so seen fit. I will receive 5M in evidence.

5N is a recapitulation of the French affair. Was he prosecuted in France in absentia?

MR. HARRIS: Yes, he was.

THE COURT: I guess that is what he is referring to.

MR. HARRIS: And appears to be the –

MR. LITT: I believe it goes with the following documents. Your Honor, that are a letter to Mr. Baudin, and this appears to be something that would accompany it.

MR. HARRIS: Same date.

MR. LITT: Same date, to explain circumstances surrounding this matter in France.

4650

MR. LITT: Five P is the letter to Mr. Bodin. And it is dated in the same manner –

MR. FLYNN: Five O, Your Honor, he is talking about forcing the mayor of Clearwater to resign.

THE COURT: We have five N here.

MR. LITT: Five N and five P appear to go with it, Your Honor.

THE COURT: Well, I'll sustain the objection as to five P. It appears that this is attorney-client privileged matter. He is communicating to his attorneys.

Now, this other deal of 2-16-68, though, there is no indication of any enclosures. This appears to be something else that he put together; for whatever purpose, I don't know. He may have done it on the same day, but that doesn't mean that it is part of the communication.

So if he wants to come into court and tell me that this is part of it, I'll be glad to hear from him. Not having heard that, I'll receive five N. Let's look at five O's.

MR. HARRIS: The relevance of that, Your Honor, is –

THE COURT: I guess this is his explanation of his problems in France.

MR. HARRIS: I would hope that that was not part of the defense in this case.

THE COURT: Well, let's see.

Did Mr. Armstrong testify with reference to this one?

MR. HARRIS: No, he didn't, Your Honor.

4651

THE COURT: I mean he testified generally to everything.

MR. HARRIS: Generally to everything, yes.

MR. FLYNN: Your Honor, as to why he sent it to me, Your Honor, Mr. Hubbard had claimed that he had never been in France. As part of his defense, Mr. Armstrong has personal knowledge that he lived in France for a period of time.

MR. HARRIS: There is certainly no testimony to that effect, Your Honor.

MR. FLYNN: With regard to Mr. Armstrong's state of mind, his overall testimony as to why he sent it to me, it is more evidence of Mr. Hubbard lying.

THE COURT: I'll receive it in evidence.

I haven't got anything on five O's yet.

What is the significance of five O's, Mr. Flynn?

MR. FLYNN: I believe it has to do with forcing the mayor of Clearwater to resign or some connection to that issue.

THE COURT: It says "Good news. Be sure to take credit for it."

Whether he had anything to do with it, I don't know.

MR. FLYNN: That was part of an operation called –

THE COURT: That is outside of the record of this lawsuit at this point.

I'll sustain the objection on the ground of relevancy at this point.

4652

He has testified that he took it. There may be things here that relate to that that he hasn't testified to, that he was never cross-examined about.

Five Q, communications by attorney. I had better be careful with this one. Let's see. "Top Secret."

MR. FLYNN: I questioned Mrs. Douglas about this, Your Honor. In this one he says he suffers from chronic pneumonia on the second page. And it is not desirable public knowledge.

MR. LITT: Your Honor, I think it is pretty clearly privileged.

MR. FLYNN: Dianetics was sold for 30 years, Your Honor, on the ground that Mr. Hubbard –

THE COURT: That may have been the reason that Mr. Armstrong took it or kept it or sent it to you.

The problem here now is whether it should be received in evidence.

What he says is, "What I need and earnestly hope from you is a workable, positive, no nonsense strategy and active planning to, A, knock in the head government efforts to subpoena me and, B, quash any indictment of me before it gets into the works."

Well, I suppose that that is just general rhetoric that every client would like to have his lawyer do things like that.

MR. FLYNN: The thing we are concerned about, Your Honor, is he had held himself out as the epitome of health

4653

because of Dianetics and Scientology processing.

THE COURT: Mrs. Douglas has testified to this. If this is the reason that your client took this, that is a part of the record.

Let's see. Since this is apparently a communication to an attorney, it had better be sealed. Five Q is sealed.

"Republic of France"; five R's. Is this the indictment? MR. FLYNNs No, Your Honor. I believe that is an Interpol report.

THE COURT: "Identification of 'Pop' Ron Hubbard." I didn't know he had that nickname. Oh, "identification of the Pope as being an American citizen named L. Ron Hubbard." Any objection to this?

MR. HARRIS: Yes, Your Honor. Relevance and 352 and hearsay. And I don't know if it is authentic or not.

MR. FLYNN: It comes from the Hubbard Archives, Your Honor.

MR. HARRIS: Well, that doesn't prove its authenticity. It appears to be a copy in any event because there is no signature, just an indication that it was signed. And there appears to be some translations and so on and –

4654

THE COURT: Well I don't know. There might be some evidence that certain agents may have infiltrated certain organizations and obtained this from some non authorized source. I will overrule the objection. I will receive it.

500 five S's –

MR. HARRIS: Can I —

THE COURT: If you want to say something.

MR. HARRIS: Yes, just briefly, Your Honor.

THE COURT: Yes.

MR. HARRIS: I have looked at this now and I am not sure what exactly it is, but I am somewhat concerned that Your Honor would consider the fact that this was in the archives as being some evidence that the organization infiltrated and took that.

THE COURT: Well I guess you are free to tell me something to the contrary. I will reopen for that purpose.

MR. HARRIS: Well I am not going to do that at this late stage. Your Honor. I have been sitting here for six weeks, but –

THE COURT: Well I don't know. It says: "I am honored to return this joint dossier. An inquiry has been initiated. The results here are enclosed here by police."

Are these things published generally?

MR. HARRIS: Well, the judicial system in France is unlike our system which is adversarial, as I think Your Honor knows. It is accusatorial, and it apparently serves — I am not a foreign law expert, Your Honor, but I can say this

4655

much: The matters that come before the magistrate in Prance are by way of a police complaint in the manner of such a thing.

THE COURT: Well if that is the only problem, then I won't draw any inference on the subject. Just something that was in the Hubbard archives and may have been acquired in the course of their communications with French authorities concerning the nature of the French proceedings that were being conducted about that time. I will receive it. I won't draw any inference about it.

5S.

MR. FLYNN: This shows that Hubbard controlled the movement of the Churches of Scientology to Clearwater, Florida. This document, in the words of Mr. Armstrong, showed complete control or indicative of complete control, and the organization had previously claimed that he had nothing to do with movement into Clearwater.

MR. HARRIS: Well, that isn't in the record. Your Honor.

4656

MR. HARRIS: I don't know what to say about that, Your Honor. Another mixed bag that doesn't seem to have a great deal of relevance to any claim in this case about Mr. Armstrong's defense.

THE COURT: Well, there is so much here I am not really sure what it is that you have reference to, Mr. Flynn. Maybe Maybe [sic] you can tell me where this collection of materials fits.

MR. FLYNN: Maybe we can pass it for the time being.

THE COURT: Issuing all kinds of orders.

MR. FLYNN: It corroborated Mr. Armstrong's testimony that based on his observations Mr. Hubbard controlled the organization throughout the time he was involved, contrary to what was represented to the public, governmental agencies.

THE COURT: For that purpose, then, I'll receive it as tending to show his participation, involvement, in the control.

We have five T called "Confidential Project U.S." Dated September 17, '65.

What is the significance of that?

MR. FLYNN: I think Your Honor has already ruled on that.

MR. HARRIS: I don't know if you did or not.

MR. FLYNN: That may be a different document.

No. Right. I have to see that, Your Honor. It is unclear on my records.

We won't offer it, Your Honor.

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THE COURT: All right. It will remain for identification only.

I'll put them in different places. Then it will be "Operation Clerk Sort Out."

I have next five U. I think this is supposed to show the creation of this public relations operation.

MR. FLYNN: This shows, per the testimony of Mr. Armstrong, that the personal office of L. Ron Hubbard was owned by him and not by the Church.

MR. HARRIS: I can't believe that that is what that shows, Your Honor.

MR. FLYNN: They were working on his products, Your Honor, the sales of his books.

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THE COURT: Well without arguing the Merits of the policy, I will receive it in evidence for whatever evidentiary value it may have; 5S.

5U's, board minutes, legal actions.

MR. FLYNN: There are documents in there that show moneys being paid to Flag banking office, U.S. in the amount of $17,325, contrary to his representation that he never received any funds from Church of Scientology Organizations; documents relating to 10 percent; documents indicating that the LRH Pers Sec was doing purely personal matters for L. Ron Hubbard; promissory notes; handwritten notes of L. Ron Hubbard regarding calculation sums, credit to him, balance sheets showing receipt of funds.

I think this particular exhibit was used quite frequently in examination of several witnesses, portions of it. I believe this may be the exhibit where it shows the different types of bank accounts in Swiss banks, moneys in his account.

That exhibit. Your Honor, may relate to 500 5X and 5Y and 5Z; V, X, Y and Z I think all go together.

THE COURT: We will take a recess. (Recess.)

MR. FLYNN: In our view. Your Honor, is that V, X, Y and Z all go together.

THE COURT: Yes, I was dealing with one exhibit, 5 Victor, board minutes and ledger items relating to
Mr. Hubbard's finances in the '60's, I gather.

MR. HARRIS: Yes, and internal church finances as well

4659

and so on.

THE COURT: Okay.

Any particular objections?

MR. HARRIS: Other than the general relevance one, the financial privacy one and First Amendment, no.

THE COURT: Well I will overrule the objection. Be received.

How about the "hot line" 5Ws? This is a copy of the "hot line" with Ron's standing order No. 1, "All mail addressed to me shall be received by me."

Is that something that was referred to?

MR. FLYNN: Correct, Your Honor. That was testified to as being something that was being relied on by Scientologists and of some significance in the organization and Mr. Armstrong said it was totally untrue.

THE COURT: Well, he's got a birth date March 13, 1911; is that inaccurate?

MR. FLYNN: No. I mean it is untrue that standing order No. 1 was the standard practice of the organization.

THE COURT: All right, I will receive 5W's. 500-5X's.

This is apparently a communication to Org, exec sec, treasurer sec worldwide, signed by Robert Draper, treasury sec worldwide.

MR. FLYNN: Those documents show the deposit of money and transfer of money by Mary Sue in the OTS Sea account into Swiss bank accounts. That is the corporation that Mr. Armstrong worked for.

4660

MR. HARRIS: First Amendment and privacy.

THE COURT: All right. Be received.

5Y, apparently is an order to Jill to investigate collection of money from St. Hill. "Get the payment in American dollars. You are to tolerate no noncompliance and no stops on this line at all, as this money is owed for the most valued service on this planet. Noncompliance will result in a mission being sent from here" et cetera.

4661

MR. HARRIS: Same objection with respect to that, Your Honor.

THE COURT: Same ruling.

MR. HARRIS: Same objection with respect to that one also, Your Honor.

THE COURT: Okay.

Five Z's, we have completed the five sequence. It will be overruled. Five Z will be received.

I hope there is an end to this someday,

MR. FLYNN: We are getting close, Your Honor. Many of the exhibits coming up are just single exhibits.

THE COURT: Okay. Six A's.

"Sequence of action for a new board of Church of Scientology."

Mr. Hubbard's control or direction, I assume?

MR. FLYNN: He was ordering the election of the board of the Church of Scientology of California, Your Honor.

MR. HARRIS: That was before he resigned.

MR. FLYNN: Just after, Your Honor. That was the significance of it. It was July 25th, '66.

MR. HARRIS: The founder –

MR. FLYNN: The resignation was March 1, '66.

MR. HARRIS: There was a resignation as trustee. The founder policy letter, I believe, is September, '66.

THE COURT: I guess it is something that is capable of interpretation.

I'll overrule the objection. It will be received.

4662

Six B's is a letter to his wife, I guess.

MR. FLYNN: This letter, Your Honor, shows — it is reflective of six inches of letters of the same type downstairs. We took one letter.

It shows financial transactions between HEC and Mr. Hubbard; payments into Swiss accounts; the receipt of 10 percent of Church funds, all after his resignation.

And as I indicated, there is another six inches of similar type letters downstairs.

There was extensive testimony by Mr. Armstrong, nearly all of the correspondence was of that type.

Six C we are not offering, Your Honor, the blue binder.

There was testimony about it. It is the White House and the Russians and brainwashing. There is testimony about it. So rather than offer it –

MR. HARRIS: First Amendment, privacy in respect to 500- –

MR. LITT: And spousal privilege.

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THE COURT: I will sustain the privileged communication, spousal objection, but Mr. Armstrong's testimony that he believed this was relevant and necessary to his defense will stand uncontradicted. Sustain the objection.

MR. LITT: We will just argue at the time as to whether or not privileged material can be taken in that context. That is fine.

THE COURT: 6C is not being offered.

6D is a dispatch to LRH, secret Telex and radio code.

MR. FLYNN: That was just to show the use of code by the organization, and a bogus 1940 secret mission story.

THE COURT: Any objection to this?

MR. HARRIS: No, other than the general objections, Your Honor.

THE CORUT: I guess I will receive 6D.

6E is something to a legal officer, 3 August, '66, branch 5 per action clipping attached.

MR. FLYNN: E and F, Your Honor, are Mr. Hubbard's handwritten notes saying in one instance on E, find his criminal past; F, find the unsavory side of a person's past. It is indicative of the same pattern, culling PC folders, using information against people.

It involves getting connected with a revolutionary group in Rhodesia.

MR. LITT: Which group is the present government of Rhodesia, Your Honor?

MR. FLYNN: Is that testimony?

MR. LITT: No, that is an historical fact.

4664

MR. HARRIS: 6F, Your Honor, just a general objection and as to the 6E's, legal officer, I don't know; attorney client privilege.

THE COURT: Well I don't think the legal officer is a lawyer. I haven't heard of that being so as yet* so I will overrule the objection. They will be received, 6E and F.

6G's really doesn't say much. Just look up and find out what these people are.

MR. FLYNN: We won't offer it then, Your Honor.

THE COURT: Remain an exhibit for identification.

6B's is confidential, December 16, '66.

MR. FLYNN: I believe there was — this is, I think, an important document, Your Honor, with regard to Mr. Hubbard ordering –

THE COURT: I don't know who it is directed to. It says Teeporten.

MR. HARRIS: Darryl Teeporten, legal officer. That is not evidence, Your Honor, just information.

MR. FLYNN: Talks about hitting them hard with statements we don't have to show up in court, suing them for libel and slander, and orders to the organization to do that.

Mr. Armstrong testified that that document he interpreted as instructions to sue, use the law for purposes of harassment, implementation of fair game doctrine.

MR. HARRIS: Well, I suppose that is one interpretation. Another one is that Mr. Hubbard might have been angry about being libeled, but whatever, I think it is attorney client privileged.

4665

THE COURT: Well, I'll overrule the objection. It is not directed to an attorney. It is just word games back and forth; whatever value it may have, I'll have to read it more carefully. But I'll receive six H.

MR. FLYNN: Six I, we are not offering, Your Honor.

THE COURT: It will remain for identification.

Six J.

MR. FLYNN: Mr. Armstrong testified and Mr. Hubbard in his handwriting saying, "Sue people to harass them; claim they are connected to Communists; engage them in intelligence operations."

The documents six J, K, L, and M are all of that type.

"Don't defend; attack." And, two, they are all in the same category, all indicative of a policy to attack anyone who criticizes Mr. Hubbard or sought to find out what he was doing.

THE COURT: Don't get too far ahead. We are still working on this one right here, J.

MR. HARRIS: General objection, Your Honor.

THE COURT: It will be overruled. It will be received.

K is a letter to Virginia.

MR. FLYNN: She is his secretary. He threatens her with a bad check charge.

MR. HARRIS: General objection, Your Honor.

THE COURT: It will be received. Overruled.

Six L, "Confidential Xerox MSH. Strategy DCR's."

4666

MR. FLYNN: Talks about opening up a total war on the IRS.

THE COURT: "Gustapo [Gestapo] tactics, including press releases."

MR. LITT: Who is this letter to?

THE COURT: Is it [It is] a joint communique to a variety of people.

MR. HARRIS: It looks like instructions with respect to legal matters and also, ". . .then get a new tax firm in D.C. that will fight the legal. . ." et cetera.

THE COURT: Well, I wouldn't consider it to be a confidential communication to his lawyers. He is just making directions regarding strategy for June 17, '65.

I'll overrule it. It will be received. It also relates to possible future criminal conduct.

Six M is to HCO DC, "Anton; do not defend; attack," so on, so on.

MR. HARRIS: Same general objection, Your Honor.

THE COURT: It will be received. Six N is –

MR. LITT: Did the Court just rule on six M?

THE COURT: Yes.

MR. LITT: I think you previously upheld the attorney-client privilege on that document.

THE COURT: Six M?

MR. LITT: I believe so.

THE COURT: I don't see anything here about an

4667

attorney.

MR. FLYNN: I don't believe so, Your Honor.

MR. LITT: Maybe I am just looking at the wrong thing here.

THE COURT: Six N is a policy, "Policy on suit reclamation of money."

It is laundering money?

MR. FLYNN: It has to do with using a maximum threat against anyone who opposes him.

THE COURT: "It is our purpose in such matters to collect the maximum amount with the minimum disturbance using the maximum threat. If no debtor were jailed (Waddingham) and you went ahead on the rest in their knowledge re Waddingham you could probably collect. You want an attorney who will act. We do not sue by percentage unless the lawyer only takes a third. Then we would; otherwise, we have fees. The purpose is only to collect money due. If everyone gets all involved, we'll lose as much as we collect. We don't sell debts at a discount, but a militant collection agency would jump at these debts for a percentage.

"In all these debts mentioned to you we were simply conned into loans. They didn't intend to pay or were simply robbed of money. We should make an effort, a good one, unimpeded by Hemery's personal fears to collect

4668

everything we can without any great cost in personal time or upset."

4669

MR. FLYNN: This relates to the policy of freeloader debts, intimidating people with threats to collect what he claims are religious donations.

60 relates to –

MR. LITT: Is the court on 6-0?

MR. HARRIS: I think this is irrelevant, Your Honor. The witnesses who actually testified about the freeloader debts put on by even Mr. Flynn indicated there was no attempt to collect. We don't know what this is. Appears to be loans of some sort which would be a bit different.

MR. FLYNN: Your Honor, that is not the testimony. The testimony is that people were made to understand that they were –

THE COURT: Well it is just an expression of a way to handle collection matters, so I will overrule the objection and receive it. Turn this into a collection case.

I don't have 6-O. Is that something I already ruled on?

THE CLERK: Yes, sustained.

THE COURT: What did I do? Conclude it was privileged?

THE CLERK: Yes.

MR. FLYNN: I'd ask you to reconsider that. It is a letter to Brinkman, and Brinkman tells him that the fair game policy is kind of outrageous.

THE COURT: Let me look at it.

MR. FLYNN: And saying modifying it in definition and use, he didn't say "cancel."

THE COURT: Oh, I am not going to change my position.

4670

MR. LITT: On that subject may I make inquiry?

THE COURT: I will order that one remained sealed; 6-O.

MR. LITT: On a couple of occasions the court, after reading a document, has said that this might not meet a crime or fraud exception, and I am not exactly clear on the court's ruling on those, but it is my understanding that one, in order for a court to make that determination, it has to be not on the basis of examining the contents of the communications itself. It has to be from extrinsic evidence, so what I just wanted to get clear whether I am right about that or not.

THE COURT: Well, I am not going to go back and review all these exhibits and worry about that. What's been done, has been done and we are going on to the next exhibit.

6P's is:

"Department of Guardian Worldwide.

"Dear Joan:

"Please forward attached to missions.

From Sue."

And attached is Mr. Hubbard's writings.

MR. FLYNN: He says, "As soon as tactical, we must attack."

THE COURT: Yes, he must have read something by General Patton because that was his approach.

MR. HARRIS: Same general objection.

THE COURT: All right, same general ruling; overruled.

That brings us to the Q's, "News of the World Suit."

4671

Some ramblings in ink here about libel and slander.

MR. HARRIS: Well it is vaguely reminiscent of this suit, private papers of the founder which have never had public issue and which were stolen from Lafayette Ronald Hubbard at St. Hill Manor.

It appears to be a communication in respect to a suit ongoing, appears to be attorney client privileged information, or at least a transmittal to attorneys.

4672

THE COURT: I don't know what it is.

What was the significance of this, "News of the World Suit"? Was there a world suit prosecuted in a world court or something?

MR. HARRIS: News of the world suit or something.

MR. FLYNN: Mr. Armstrong, Your Honor, had indicated this was indicative of the Fair Game Doctrine so as to make the plaintiffs suffer. He had read from this at length.

These next few documents, he read at length. And we felt there was important language of Mr. Hubbard with regard to using the law to just harass people.

There is no indication here that it is a communication to an attorney.

THE COURT: Well, I'll overrule the objection. It will be received as exhibit 6 R's which is — I don't know. This has the communication back and forth about some police in '66. Then he writes a letter to "Dear Chief Constable."

MR. FLYNN: That was to be signed by the organization, Your Honor.

THE COURT: "The instigator who seems to consider themselves quite something and the law according to our investigations of a known pervert and a card-carrying Communist, a blackmailer with a prison record, the London paper is doing. . ." et cetera.

MR. FLYNN: Mr. Armstrong testified that is indicative of the approach by the organization in the last 15 years.

That is why PC files are culled.

4673

MR. HARRIS: That is why? A big generality, Your Honor.

THE COURT: I don't know what that has to do with this particular exhibit.

Let's not worry about it.

MR. HARRIS: A general objection, Your Honor,

[MR. HARRIS: A general objection, Your Honor.]

[THE COURT:] I'll overrule the objection.

The six R's will be received.

What about "Estimates and Reader's Digest"?

MR. FLYNN: That is regarding operations against me, Your Honor.

Mr. Armstrong testified about taps on telephones, card files, 30 feet of card files; 30 feet of materials made up on a list of five or six people in there including myself. There was "Operation Juggernaut" mentioned in there.

MR. HARRIS: If Your Honor believes it is an operation against Mr. Flynn, then I guess it is relevant.

THE COURT: We'll receive it.

Six P's is simply a copy of a letter sent to Mr. Hubbard's communication office indicating his probation expired in June of '51.

I don't know what that has to do with. I suppose it has to do with that he at one time or another had been placed on probation for something.

MR. FLYNN: Went to his general background that he had been convicted of a crime.

MR. HARRIS: That doesn't necessarily prove that he was convicted of a crime.

THE COURT: It is hard to get on probation in 1951 unless you were convicted of something.

4674

MR. HARRIS: No diversion or anything like that then, Your Honor?

THE COURT: None of those things existed at that time. I'll sustain the objection. The prejudice is outweighed by its limited probative value.

U.

MR. FLYNN: These are the photographs that Mr. Armstrong testified were stolen from L. Ron Hubbard's son by Cary Milner.

THE COURT: Are these pictures of his son?

MR. FLYNN: His son and Mr. Hubbard with a dispatch from Milner attached.

4675

THE COURT: You want to see these, Counsel?

MR. HARRIS: So, I don't want to see the photographs, but I'd like to see the dispatch referred to. That might have some relevance.

THE COURT: Is there something in there about a dispatch?

MR. HARRIS: Well, Mr. Flynn claims there is a dispatch.

THE COURT: Is that a different exhibit?

MR. FLYNN: No it should be inside the manila envelope, Your Honor.

Mr. Armstrong went and saw L. Ron Hubbard, Jr. with respect to the photographs.

MR. LITT: Objection, Your Honor. There is no testimony about that.

THE COURT: Well there was some testimony that they had taken some things down to Clearwater to show or give –

MR. LITT: But that is not what –

MR. FLYNN: He has testified on 2064 and 2065 that he had conversations with L. Ron Hubbard, Jr., and that Mr. Armstrong had believed that these documents had been stolen from Nibs, who was L. Ron Hubbard, Jr.

MR. LITT: Right. There is no testimony concerning anything else, Mr. Armstrong's belief.

MR. HARRIS: It is irrelevant.

MR. FLYNN: Well, as long as they stay in the court. Your Honor, we won't offer them.

THE COURT: All right. They will remain as an exhibit for identification, and I guess upon application

4676

of Mr. Hubbard, Jr. –

MR. HARRIS: We'd contest that, Your Honor, just in case you thought they were his.

THE COURT: I won't make any –

V is Dr. Hubbard awarded Ph.D. by Tom Esterbrook. Is that his alter ego?

MR. FLYNN: Right. It is something to show that he was writing his own press releases under someone else's name.

THE COURT: Wasn't Esterbrook a pen name he used?

MR. FLYNN: That was a pen name he used.

THE COURT: "Called, erroneously or otherwise, 'The world's best known psychiatrist' yet there were three States in the Union where he could have practiced, though fully qualified even in these to build an atom bomb."

Are you offering that?

MR. FLYNN: We will offer that.

THE COURT: Any objection?

MR. HARRIS: General objection.

THE COURT: All right. Be received.

Maybe Mr. Hubbard was kidnapped by the Russians for his atom bomb knowledge. Check that out.

MR. FLYNN: We are going to send Mr. Young over, to find out.

THE COURT: The Explorer's Club, exhibit 6W's.

MR. FLYNN: Mr. Hubbard forged the signature of a guy named Fudge, in application to the Explorer's Club.

4677

Is that something that is in here or what?

MR. FLYNN: It is something in there that Mr. Armstrong testified about.

0h, I'm sorry, Your Honor. Be writes the letter for Fudge for Fudge to sign.

MR. LITT: So?

MR. FLYNN: And the representations in the document, which is approximately 10 pages long, are not accurate with regard to statements he is making to the Explorer's Club.

THE COURT: Well he is writing the letter. There are two things here. One is a letter to U.S. Navy Department, "Gentlemen" in his handwriting, signed "Sincerely, John Fudge."

And this other part is:

"Marilyn –

"Make several copies. Send one to the Explorer's Club in NYC, one to the local club, original and a copy, and one to Fudge, and one or two to files."

I don't know when this was.

MR. HARRIS: There are two letters. Put together, they do make sense. John Fudge is indicated as the person the Explorer's Club should –

"Any assistance you or any of your local members could give Dr. Fudge in helping locate the right government person about various surplus items would be greatly appreciated."

And then the followup is apparently written for Fudge. No evidence of any irregularities or anything else in respect to that, Your Honor.

4678

MR. FLYNN: Your Honor, the witness testified that there were fraudulent claims in there made to the Explorer's Club by Mr. Hubbard.

MR. HARRIS: There is no indication of that in the document itself, Your Honor.

MR. FLYNN: is Mr. Harris now saying –

MR. HARRIS: No. I am just saying I read it; it doesn't look like that to me. Maybe Your Honor will read it and see something different.

MR. FLYNN: There is a statement in there, Your Honor, about the medals that he had earned during the war.

MR. HARRIS: I didn't see any such.

MR. FLYNN: What are we on now?

THE COURT: I think I'll sustain the objection. There may be some value to it. It seems like it is rather remote.

Six X is –

MR. FLYNN: Mr. Hubbard claims he is on an expedition into West Africa in 1972.

Mr. Armstrong was with Mr. Hubbard throughout 1972.

THE COURT: That is a letter to Mr. Shal from Hubbard regarding a cartoon — from Shal to Ron concerning something on ABC, And then Hubbard returns — he is talking about going to be sued; also in trouble for false statements. I don't know what that shows.

MR. FLYNN: I have to take a look at that.

THE COURT: There is something attached to the back; "Arnold Haverley knows LRH from the old days during WW II."

MR. FLYNN: Do you have six Y, Your Honor, or six X?

4679

THE COURT: Six X. This last part of six X may relate to six Y.

I guess "compliance report to 'Dear Dick" refers to this — this may have to do with some other aspect of this.

Why don't you look at it, counsel?

MR. FLYNN: Routing regarding the Intelligence Bureau.

Mr. Hubbard says, "My last expedition in '72 into West Africa will last me awhile."

Mr. Armstrong testified that he was with Mr. Hubbard through '72. There was no expedition into West Africa.

Six Y related to the fact that they were concerned that this fellow Haverley had intelligence data on Mr. Hubbard; so the Guardian's Office was sent out to find out what information Haverley had on Mr. Hubbard.

MR. HARRIS: Well, that is a bit delusionary as far as what the documents themselves say, Your Honor.

Maybe Your Honor can figure that out. I don't think either one of them are relevant.

MR. FLYNN: He claims that he led all of these expeditions. There was not a germ of truth to it, Your Honor.

4680

THE COURT: Well, we have got another story there. He was in Alaska sleeping in the cabin of a boat with some other men. All of a sudden, a Kodiak bear climbed aboard and as it did, it tilted the boat, and the boat started drifting out to sea and the men could do nothing with the bear outside the cabin. Even the guns were outside with the bear. So there they were, stranded in the cabin for three days with a Kodiak bear at the command until the bear jumped ship.

MR. HARRIS: Written by someone other than Mr. Hubbard, Your Honor.

THE COURT: This is, " Ron's story and the book goes like this." The book was written by somebody else.

Of course, it might have been a liar's club type of thing.

I will receive X and Y.

Z, what is the point of Z?

MR. FLYNN: That is the one where the blank stationery, a blue file folder filled with blank stationery, and one of them Mr. Armstrong testified that Mr. Hubbard had forged a recommendation, and his handwriting is all over the document in signing it for someone else on someone's else stationery.

There are various items of blank stationery from several different sources. Including the Navy.

In addition, the statements within the phony recommendation in themselves are not true.

THE COURT: Well I don't recall the testimony as to

4681

how this letter was determined to be a forged letter.

MR. FLYNN: Mr. Armstrong testified that he found blank pieces of stationery, one from the U.S. Naval Hospital, and another apparently on Explorer's Club stationery and signed by Robert Lees as a recommendation for Mr. Hubbard. My belief is that Mr. Hubbard, in fact, wrote it and signed it for Mr. Lees, based on his familiarity with Mr. Hubbard's handwriting. He said he sent this material to me because he had come across in the biography research a number of such documents which appeared that Mr. Hubbard had written someone else's letter for him and had filled in for someone else, and in one case a fitness report and another case a statement of medals that he had earned during the war, and that was just to me a small evidence of the type of fraud in which Mr. Hubbard engaged.

THE COURT: I can't receive it as evidence that this is a forgery. I can receive it as what it is, and then what Mr. Armstrong's belief as to what it might constitute, but I am not a handwriting expert and I believe you'd have to have Mr. Lees here to disaffirm it before it could be considered to be a forgery.

4682

THE COURT: I don't want to go any further. We still have a bunch — we still have a whole series of –well, the plaintiff has got exhibits too, a bunch of those, I am not accepting that that constitutes a forgery.

Plaintiff has several or quite a few exhibits under seal that they have marked; am I not correct7

MR. HARRIS: That's right, Your Honor.

THE COURT: So I guess we'll have to resume again tomorrow morning again at 9 o'clock.

MR. LITT: Could we have — assuming that tomorrow morning we'll take an hour or so, could we have a rough prediction of when we expect to start argument?

MR. HARRIS: How about Friday morning, Your Honor?

THE COURT: That is okay with me if we can finish some time tomorrow morning. We can start argument on Friday morning. That would be okay. Maybe we can wind up the argument on Friday.

MR. HARRIS: Maybe you should make a ruling that the argument should be wound up Friday.

THE COURT: There are four arguments that you folks have available to you. And Mr. Flynn only has one. I would like to wind it all up Friday, though.

MR. LITT: We can certainly try to keep the opening arguments to roughly an hour and a half or so between us.

MR. FLYNN: A total of an hour and a half?

MR. LITT: The opening round. And then you'll argue and then it is hard to say after that. It depends on what you say.

4683

THE COURT: I'll try to resolve it all Friday in argument. We'll see.

We'll be in recess.

(At 4:04 p.m., an adjournment was taken until Thursday, June 7, 1984; at 9:00 a.m.)