SUPERIOR COURT OF THE STATE OF CALIFORNIA

FOR THE COUNTY OF LOS ANGELES

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Cross-Complainant, GERALD ARMSTRONG, alleges as follows:

PARTIES

1. Cross-Defendant, CHURCH OF SCIENTOLOGY OF CALIFORNIA, hereinafter Cross-Defendant "SCIENTOLOGY" is a corporation organized and existing under the laws of the State of California, having a principal office and place of business in California and doing business in the State of California within the territorial jurisdiction of this Court.

2. Cross-Defendant, L. RON HUBBARD, hereinafter Cross-Defendant HUBBARD, is the founder of Cross—Defendant SCIENTOLOGY and at all times material to this Cross—Complaint was, by virtue of his role as the founder and leader of Cross-Defendant SCIENTOLOGY, overall Supervisor of the Guardian's Office and of the Sea Organization of Cross-Defendant SCIENTOLOGY. The Guardian's Office and Sea Organization had agents operating in Cross—Defendant SCIENTOLOGY under the ultimate control of Cross-Defendant HUBBARD. Cross—Defendant HUBBARD was knowledgeable and had ultimate control over the activities of employees of Cross-Defendant SCIENTOLOGY specifically over the Guardian's Office and Sea Organization as pled herein, Cross-Defendant HUBBARD was a resident of the State of California from early 1976 through several months into 1980 at which time some of the acts complained of herein against Cross-Defendants, each, commenced, although said acts were not discovered until the

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fall of 1981. Cross-Defendant HUBBARD has a legal address in the State of California although he is now concealing his whereabouts through an elaborate system with the goal of avoiding service of legal process or summons. The acts alleged herein of Cross~Defendant SCIENTOLOGY are the acts as agent of Cross-Defendant HUBBARD and said acts constituted a course of conduct carried on within the State of California under the orders and supervision of Cross-Defendant HUBBARD. The acts of Cross-Defendant HUBBARD against Cross-Complainant were causing consequences in the State of California by fraudulently using the services, time, and labor of the Cross—Complainant. Cross—Defendant HUBBARD is believed to be in the State of California, however he conceals his actual whereabouts.

3. Cross—Defendant, CHURCH OF SCIENTOLOGY INTERNATIONAL, hereinafter Cross-Defendant "SCIENTOLOGY INTERNATIONAL", is a corporation organized and existing under the laws of the State of California, having a principal office and place of business in California, and doing business in the State of California within the territorial jurisdiction of this Court.

4. Cross—Defendant, RELIGIOUS TECHNOLOGY CENTER, hereinafter Cross—Defendant "RTC", is a corporation organized and existing under the laws of the State of California, having a principal office and place of business in California, and doing business in the State of California within the territorial jurisdiction of this Court.

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5. At all times herein mentioned, the individuals set forth herein, Graham Leese, Kingsley Wimbush, Helen Pollen, Dorothy Knight, Jan Norton, Anne Tasket, Virgil Wilhite, Lyman Spurlock, Marilyn Brewer and other unnamed Scientologists were acting as agents/representatives/employees for Cross-Defendant SCIENTOLOGY within the course and scope of their agency/representation/employment.

6. At all times herein mentioned, each Cross-Defendant was the agent and employee of each of the remaining Cross-Defendants, and in doing the things hereinafter mentioned, each Cross-Defendant was acting within the course and scope of its employment and authority as such agent/representative/employee, and with the consent of the remaining co—Cross—Defendants.

7. Cross—Defendants, DOES l through 100, inclusive, are sued herein under such fictitious names for the reason that the true names and capacities of said Cross—Defendants are unknown to Cross-Complainant at this time; that when the true names and capacities of said Cross—Defendants are ascertained Cross-Complainant will ask leave of Court to amend this-Cross~Complaint to insert the true names and capacities of said fictitiously named Cross-Defendants, together with any additional allegations that may be necessary in regard thereto; that each of said fictitiously named Cross-Defendants claim that Cross-Complainant has a legal obligation to Cross-Defendants by virtue of the facts referred to below; that each of said

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fictitously named Cross-Defendants are in some manner legally responsible for the acts and occurrences hereinafter alleged.

FIRST CAUSE OF ACTION

(For Fraud Against Cross-Defendants SCIENTOLOGY and HUBBARD)

8. Cross-Complainant repeats and realleges Paragraphs 1-7 as though fully set forth herein and further alleges:

9. At all times material herein, Cross-Defendants, each, held themselves out to the Cross-Complainant to be a part of a legitimate, law-abiding, scientific, education organization engaged in the business of providing goods and services as a non-profit organization wherever they were authorized by law to do business. Cross—Defendants, each, perpetrated the acts set forth in this Cross-Complaint as a matter of written policy, composed, implemented and enforced by the individual Cross—Defendant HUBBARD and specially implemented against the Cross-Complainant by the agents/representatives/employees of Cross-Defendant HUBBARD and SCIENTOLOGY pursuant to the written directives and policy of Cross-Defendant HUBBARD. The policies, doctrine and conduct alleged herein constitute a civil conspiracy by Cross-Defendants, each, to commit the torts sot forth herein.

10. Cross-Defendants, HUBBARD and SCIENTOLOGY, have for a period exceeding 15 years engaged in a pattern of

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mail fraud and conspiracy to commit mail fraud. In connection with said mail fraud, Cross-Defendants, HUBBARD and SCIENTOLOGY, wrote, published and disseminated the publications set forth below through the mails to Cross-Complainant in at least three separate places on numerous occasions as follows: September 1969 - February 1971 in Vancouver, British Columbia; February 1971 in Los Angeles, California; February 1971 — 1975, on the yacht, Apollo; 1975 - 1979 in Clearwater, Florida; and 1977 - December 1981, in California. The following publications contain selected examples of "non-religious", "false", secular representations as excerpted from a federal judgment in the case set forth in Paragraph ll of this Cross-Complaint, and made to Cross-Complainant by Cross-Defendants, HUBBARD and SCIENTOLOGY, their agents/representatives and employees:

(a) Eight-page pamphlet, entitled "What is Scientology?" "Scientology is today the only successfully validated psychotherapy in the world. Tens of thousands of completely documented cases exist in the files of the Hubbard association of Scientologists International."

"The first science to put the case of psychotherapy within the range of any person"s pocketbook. A complete Freudian analysis costs $8000 to $15,000. Better results can be achieved in Scientology for $25.00 and on a group basis for a few dollars."

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"The first science to make whole classes of backward children averagely bright using only drills the teacher can do a few minutes in each day."

"The first science to determine the basic cause of disease."

"The first science to contain exact technology to routinely alleviate physical illnesses with complete predictable success."

"The first science of mind to prove conclusively that physical illness can stem from mental disturbance, a fact which Freud held only as a theory, and only seldom demonstrated."

(b) Twenty-four page pamphlet, entitled "Ability Issue 71: Being Clear and How to Get There," by L. Ron Hubbard.

"Scientology, the optimum individual is called the clear. One will hear much of that word, both as a noun and a verb, so it is well to spend the time here at the outset setting forth exactly what can be called a clear, the goal of Scientology processing."

"A clear can be tested for any and all psychoses, neuroses, compulsions and repressions (all aberrations) and can be examined for any autogenic (self generated) diseases referred to as psychosomatic ills. These tests confirm the clear to be entirely without such ills or aberrations. Additional tests of his intelligence

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indicate it to be high above the current norm. Observation of his activity demonstrates that he pursues existence with vigor and satisfaction."

"Further, these results can be obtained on a comparative basis. A neurotic individual, possessed also of psychosomatic ills, can be tested for those aberrations and illnesses demonstrating they exist. He can then be given Scientology processing to the end of clearing these neuroses and ills. Finally, he can be examined, with the above results. This, in passing, is an experiment which has been performed many times with invariable results. It is a matter of laboratory test that all individuals who have organically complete nervous systems respond in this fashion to Scientology clearing."

(c) Book, entitled "Dianetics: The Modern Science of Mental Health," by L. Ron Hubbard.

"Simple though it is, dianetics does and is these things:

1. It is an organized science of thought built on definite axioms: statements of natural laws on the order of those of the physical sciences.

2. It contains a therapeutic technique with which can be treated all inorganic mental ills and all psycho-somatic ills, with assurance of complete cure in unselected cases.

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3. It produces a condition of ability and rationality for Man well in advance of the current norm, enhancing rather than destroying his vigor and personality.

4. Dianetics gives a complete insight into the full potentialities of the mind, discovering them to be well in excess of past supposition.

5. The basic nature of man is discovered in dianetics rather than hazarded or postulated, since that basic nature can be brought into action in any individual completely. And that basic nature is discovered to be good.

6. The single source of mental derangement is discovered and demonstrated, on a clinical or laboratory basis, by dianetics.

7. The extent, storage capacity and recallability of the human memory is finally established by dianetics.

8. The full recording abilities of the mind are discovered by dianetics with the conclusion that they are quite dissimilar to former suppositions

9. Dianetics brings forth the non-germ theory of disease, complementing bio-chemistry and Pasteur's work on the germ theory to embrace the field.

10. with dianetics ends the 'necessity of destroying the bran by shock or surgery to effect 'tractability' in mental patients and 'adjust' them.'

ll. A workable explanation of the physiological effects of drugs and endocrine substances exists in dianetics

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and many problems posed by endocrinology are answered."

"Chapter V

PSYCHO-SOMATIC ILLNESS"

"Psycho—somatic illnesses are those which have a mental origin but which are nevertheless organic. Despite the fact that there existed no precise scientific proof of this before dianetics, and opinion as to their existence has been strong since the days of Greece, and in recent times various drug-preparations have been concocted and sold which were supposed to overcome these sicknesses. Some success was experienced, sufficient to warrant a great deal of work on the part of researchers. Peptic ulcers, for instance, have yielded to persuasion and environmental change. A recent drug called ACTH has had astonishing but wildly predicting results. Allergies have been found to yield more or less to things which depressed histamine in the body."

The problem of psycho-somatic illness is entirely embranced by dianetics, and by dianetic technique such illness has been eradicated entirely in every case."

"On the physical therapy level anything as violent as surgery or exodontistry in the psycho-somatic place is utter barbarism in the light of dianetics. 'Toothache’ is normally psycho-somatic."

"Organic illnesses enough to fill several catalogues are psycho-somatic. No recourse to surgery of any kind should be had until it is certain that the ailment is "

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not psycho-somatic or that the illness will not diminish by itself if the potency of the reactive mind is reduced.”

(d) Twelve-page pamphlet, entitled "Ability Issue 72"

(e) Sixty-four page booklet entitled "Scientology: The Fundamentals of Thought”, by L. Ron Hubbard.

Subtitle: "The Basic Book of the Theory and Practice of Scientology for Beginners".

Scientology is that branch of psychology which treats of (embraces) human ability. It is an extension of DIANETICS * * * Scientology is actually a new but very basic psychology in the most exact meaning of the word. It can and does change behaviour and intelligence and it can and does assist people to study life. Scientology, used by the trained and untrained person improves the health, intelligence, ability, behavior, skill and appearance of people.

It is a precise and exact science, designed for an age of exact sciences.

Scientology is employed by an Auditor (one who listens and commends) as a set of drills (exercises, processes) upon the individual, and small or large groups. It is also employed as an educational (teaching) subject. It has been found that pesons can be processed (drilled) in Scientology with Scientology exercises and can be made

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well of many, many illnesses and can become brighter, more alert and more competent. BUT if they are only processed they have a tendency to be overwhelmed and startled and although they may be brighter and more competent they are still held down by an ignorance of life. Therefore, it is far better to teach AND process (audit, drill) a person than only to process him. In other words the best use of Scientology is through processing and education in Scientology. In this way there is no imbalance. It is interesting that people only need to study Scientology to have some small rise in their own intelligence, behaviour and competence. The study itself is therapeutic (good medicine) by actual testing.

Tens of thousands of case histories (reports on patients, individual records) all sworn to (attested before public officials) are in the possession of the organizations of Scientology. No other subject on earth except physics and chemistry has had such grueling testing (proofs, exact findings). Scientology in the hands of an expert (Auditor) can cure some 70% of Man's illnesses (sicknesses). Scientology is used by some of the largest companies (business organizations) on Earth. It is valid. It has been tested. It is the only thoroughly tested system of improving human relations, intelligence and character and is the only one which does.

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(f) Seventy-one page booklet, entitled "The Problems of Work," by L. Ron Hubbard.

"Scientology is the first American science of Man. It is the technical know-now of the American applied to himself. In contrast to the metaphysical thinking of Europe that has formed the basis of our concepts of ourselves, Scientology is a technology, is factual and is exact as the technologies that base the development of the atom bomb . . . and it has a like source - the first class in nuclear physics, taught at George Washington University."

"Scientology can and does change human behavior for the better. It puts the individual under control of himself - where he belongs. Scientology can and does increase human intelligence. By the most exact tests known it has been proven that Scientology can greatly increase intelligence in the individual. And Scientology can do other things. It can reduce reaction time and it can pull the years off one's appearance. But there is no intention here to give a list of all it can do. It is a science of life and it works- It adequately handles the basic rules of life and it brings order into chaos."

"The mysteries of life are not today, with Scientology, very mysterious. Mystery is not a needful ingredient. Only the very aberrated man desires to have vast secrets held away from him. Scientology has slashed through many of the complexities which have been erected for men

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and has bared the core of these problems. Scientology for the first time in man's history can predicatably raise his intelligence, increase ability, bring about a return of the ability to play a game, and permits man to escape from the dwindling spiral of his own disabilities. Therefore, work itself can become a game, a pleasant and happy thing."

(g) "Hard cover book, 112 pages, entitled "All About Radiation, by a Nuclear Physicist and a Medical Doctor" (by Cross-Defendant HUBBARD)

We care very little about whether there is radiation in the atmosphere because a person who is in excellent physical condition does not particularly suffer mentally and thus physically from the effects of radiation. when a person is at a level where his general physical health is good, then this worry is not capable of depressing him into ill-health. Radiation is more of a mental than a physical problem and Scientology handles that."

"The reaction to radiation in persons who have been given Scientology processing is by actual tests much lower than those who have not received it. We have conducted many experiments in that direction. But even we would find it very difficult and even antipathetic to get everybody together and give them the amount of group processing needed as safeguard against radiation."

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11. The foregoing publications and representations have been excerpted and quoted directly from the "Appendix" in the case of United States v. Article or Device, 333 F.Supp. 357 at p..365 (Dis.Col.D. 1971), where a Federal Court found that the quoted publications were "Non-religious, and Samples of False or Misleading Claims, (Emphasis supplied). The Circuit Court of Appeals affirmed the foregoing case, and issued a judgment condemning said literature and E-meters. In addition, said literature and E-meters were to bear a "Warning" to the reader/user that E-meters are not medically or scientifically useful for the diagnosis, treatment or prevention of any disease and are not capable of improving the health or bodily functions of anyone.

12. Between the years 1972 and 1981 Cross-Complainant was entitled to receive the "Warning" required by said Judgment specifically in connection with the following publications and the false and fraudulent representations therein, published by Cross-Defendant SCIENTOLOGY and read and relied upon by Cross-Complainant:

(a) Eight-page pamphlet entitled "What is Scientology?" ;

(b) Book entitled "Dianetics: The Modern Science of Mental Health";

(c) Book entitled "All About Radiation, by a Nuclear physicist and a Medical Doctor".

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13. Notwithstanding the foregoing "Judgment", between 1972 and 1981, Cross-Complainant paid for and received from Cross-Defendants SCIENTOLOGY and HUBBARD the publications set forth in Paragraphs 10 and 12, did not receive the required "Warning".

14. In or about 1971 and continuously through December, 198L, Cross-Defendants, each, through written publications and oral statements of their agents/representatives/employees Graham Leese, Kingsley Wimbush, Helen Pollen, Dorothy Knight, Jan Norton and Ann Tasket, falsely and fraudulently represented to Cross-Complainant that if Cross-Complainant joined Scientology and underwent various courses and auditing for money, the following benefits were scientifically guaranteed:

(a) Scientology is an educational, scientific, law abiding, non-profit organization, abiding by the laws of the United States governing non-profit organizations, dedicated to the well-being of mankind and engaged in lawful, educational and scientific research, study and practices throughout the United States and the world;

(b) Scientology and auditing were scientifically guaranteed to cure health problems and diseases;

(c) Scientology and auditing were scientifically guaranteed to raise I.Q.

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Scientology and auditing were scientifically guaranteed to promote family unity and preserve marriages;

Auditing disclosures were completely confidential;

Scientology and auditing were scientifically guaranteed to prevent colds, improve eyesight, cure neuroses, cure mental, physical and emotional problems. Hubbard was the living proof that physical illness such as combat wounds could be cured, and after the war he completely healed himself.

Scientology and auditing were scientifically guaranteed to improve Cross-Complainant's career opportunities;

All scientifically guaranteed benefits of auditing would be obtained if Cross-Complainant joined the Sea Organization of Scientology;

All medical and dental needs would be taken care of if Cross-Complainant joined the Sea Organization of Scientology;

That by joining Scientology, Cross-Complainant would be part of the most ethical group on the planet.

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15. The representations so made by Cross-Defendants, each, were in fact secular and false. The true facts were:

(1) That Scientology and auditing did not scientifically guarantee: a cure for health problems and diseases; an increase in Cross-Complainant's I.Q.; prevention of colds; improvement of eyesight; a cure for neuroses; a cure for all mental, physical and emotional problems; and an improvement of Cross-Complainant's career opportunities;

(2) That Cross-Defendants, each, intended only to take Cross-Complainant's money and enslave his mind;

(3) That Cross-Defendants, each, did not keep confidential the highly personal auditing disclosures of Cross-Complainant;

(4) That Cross-Defendant HUBBARD was a fake and a fraud as more fully set forth in Paragraph ;

(5) That Cross-Defendant SCIENTOLOGY does not constitute, operate or function as a legitimate scientific, educational, non-profit organization.

16. When Cross-Defendants, each, made the aforementioned representations contained in Paragraphs 10 and 14, Cross-Defendants, each, knew said representations to be false, and Cross-Defendants, each, made said representations

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with the intent to defraud and deceive Cross-Complainant and with the intent of inducing reliance and dependence on the part of Cross-Complainant to act in the manner hereinafter alleged.

17. During the years 1971 through December, 1981, to further induce Cross-Complainant to join Scientology and undergo various courses and auditing for money, it was falsely and fraudulently represented to Cross-Complainant, through biographical publications written by Cross-Defendant HUBBARD and distributed by Cross-Defendant SCIENTOLOGY, and through oral representations of their agents/representatives/employees, Graham Leese and Dorothy Knight that:

(a) Cross-Defendant HUBBARD was a medical doctor, that he graduated with an engineering degree from George Washington University, that he did post-graduate work at Princeton University and that he was a nuclear physicist;

(b) Cross-Defendant HUBBARD had served four years in actual combat, commanded a squadron of Corvettes, and was crippled and blinded in world War II, but healed himself completely through Dianetic auditing;

(c) Cross-Defendant HUBBARD was a war hero and received two purple hearts and a total of 28 medals and palms;

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(d) Cross-Defendant HUBBARD spent several years in Asia, travelling and studying, including studies under.Tibetan Lamas in his travels to Tibet;

(e) Cross-Defendant HUBBARD was twice pronounced dead, but in 1950 given a perfect bill of health for mental and physical fitness;

(f) Cross-Defendant HUBBARD had never been involved with Black Magic, but had been voted into the policeman's Hall of Fame for breaking up a Black Magic ring;

(g) Cross-Defendant HUBBARD studied the work of Sigmund Freud under a personal student of Freuds;

(h) Cross-Defendant had done the first complete mineralogical survey of Puerto Rico.

Cross-Complainant particularly and expressly relied upon the foregoing representations, all of which Cross-Complainant discovered to be false and fraudulent in or about the fall of 1981.

18. Contrary to the false and fraudulent representations made to the Cross-Complainant, the true facts are that Cross-Defendant HUBBARD is not a nuclear physicist, nor a medical doctor; did not graduate from George Washington University or do post-graduate work at Princeton; did not serve four years in combat; did not suffer any wounds as a result of combat in World War II; did not cure blindness

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resulting from war wounds through auditing; was not a decorated war hero; was never twice pronounced dead and thereafter found to be physically and mentally fit; did not study under Tibetan lamas or students of Freud; was involved in Black Magic; and never did the first complete mineralogical survey of Puerto Rico. Cross-Defendant HUBBARD, in fact, never graduated from said universities, flunked the only physics course he ever took, never served in any combat, spent four years in the U.S. Navy in the United States, except for three months in Australia; was relieved of duty on several occasions, once in June 1943 when he ordered the crew of a ship to fire "practice rounds" off the coast of Mexico; and again relieved of duty in September 1944 when he found a coke bottle filled with gasoline with a wick attached on board his ship three days before the ship sailed to the South Pacific and into combat; sought disability from the V.A. for suicidal tendencies and mental illness, and was diagnosed as suffering from duodenal ulcers; was involved in a bigamous marriage, stole funds from his partner, wrote bad checks and was generally chased by various authorities and creditors across the United States.

19. Cross-Complainant, at the time said aforementioned representations were made by Cross-Defendants, each, was ignorant of the falsity of Cross-Defendants', each, representations and believed them to be true. In reliance on said representations, Cross-Complainant was induced to and did the following:

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(a) Invested eleven years of his life, laboring an average of 80 hours per week, for Cross-Defendants, each, without just compensation ;

(b) Forfeited a formal education;

(c) Made personal disclosures about Cross-Complainant's life during intensive "auditing" sessions, which Cross-Complainant was promised would remain confidential and which Cross-Defendants, each, thereafter disclosed to third persons.

(d) Underwent course and "auditing" for which Cross-Complainant paid money to Cross-Defendants, each, in a sum which is presently unascertained, but Cross-Complainant will ask leave of Court to amend this Cross-Complaint when the same has been ascertained.

20. As a proximate result of Cross-Defendants', each, fraud and deceit, Cross-Complainant was induced to expend eleven years of time, energy and money in an attempt to derive the scientifically guaranteed benefits as represented by Cross-Defendants, each, by reason of which Cross-Complainant has been damaged in a sum which is presently unascertained, but Cross-Complainant will ask leave to Court to amend this Cross-Complaint when the same has been ascertained.

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21. In doing the acts herein alleged, Cross-Defendants, each, acted with oppression, fraud and malice, and Cross-Complainant is entitled to punitive damages in the sum of Fifteen Million ($15,000,000.00) Dollars.

SECOND CAUSE OF ACTION

(For Intentional Infliction of Emotional Distress Against All Cross-Defendants)

22. Cross-Complainant repeats and realleges Paragraphs 1 through 21 as though fuly set forth herein and further alleges:

23. In or about 1971 and continuously through December, 1981, Cross-Defendants HUBBARD and SCIENTOLOGY promised and represented to Cross-Complainant that any and all information disclosed during "auditing" would remain Confidential between Cross-Complainant and the auditor.

24. Contrary to said promises and representations, Cross-Defendants, each intentionally, oppressively and maliciously disclosed to third persons the confidential information disclosed by Cross-Complainant during "auditing". Further, Cross-Defendants, each, intentionally, oppressively and maliciously engaged in a systematic course of conduct designed and intended to disclose said information received furing "auditing" to control and manipulate Cross-Complainant.

25. In or about February of 1982 and April of 1982, after Cross-Complainant left the Church of Scientology,

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Cross-Defendants, each intentionally, oppressively and maliciously declared Cross-Complainant to be a "Suppresive Person" subject to the "Fair Game Doctrine", which promotes Harassment and intimidation of those opposed to Scientology and states as follows:

"Fair Game. May be deprived of property or injured by any means by any Scientologist without any discipline of the Scientologist. May be tricked, sued or lied to or destroyed."

26. As a result of the intentional, oppressive and malicious conduct of Cross-Defendants, each, in declaring Cross-Complainant to be a "Suppressive person" subject to the Fair Game Doctrine", Cross-Complainant was placed in trepidation and fear for his life, has had materials stolen from him by Cross-Defendants, each, has been continually harassed, followed, pushed, assaulted, and kept under constant surveillance by Cross-Defendants, each.

27. In doing the acts hereinabove alleged, Cross-Defendants', each, conduct was intentional, malicious, oppressive, outrageous and extreme, and done for the purpose of causing Cross-Complainant severe emotional shock, trauma, mental anguish, fear and anxiety.

28. As a direct and proximate result of the intentional, oppressive, malicious, willful, wanton, wrongful and reckless acts of Cross-Defendants, each, as aforesaid, Cross-Complainant was hurt and injured in Cross-Complainant's

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health, strength and activity, sustaining shock and great emotional, physical and psychological distress; all of which caused and continue to cause.Cross-Complainant great emotional, physical and psychological pain and suffering.

Cross-Complainant is informed and believes that said injuries will result in some permanent disability to Cross-Complainant at this time, and Cross-Complainant will ask leave of Court to amend this Cross-Complaint in this regard when same has been ascertained.

29. In doing the acts herein alleged, Cross-Defendants, each, acted with oppression, fraud and malice, and Cross-Complainant is entitled to punitive damages in the sum of Fifteen Million ($15,000,000.00) Dollars.

THIRD CAUSE OF ACTION

(For Libel On Its Fact Against All Cross-Defendants)

30. Cross-Complainant repeats and realleges Paragraphs 1 through 29 as though fully set forth herein and further alleges:

31. On or about February 18, 1982 and again on April 22, 1982, Cross-Defendants, each, printed, published, and circulated, or caused to be printed, published and circulated a "Suppressive Person Declare Gerry Armstrong", which is attached hereto as Exhibit "A" and incorporated herein for all purposes.

32. Said "Suppressive Person Declare Gerry Armstrong" is libelous on its face because it charges

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Cross-Complainant with the crimes of theft, illegally take or possessing Church property, falsifying documents, false pretenses, willful loss or-destruction of Church property, among numerous other groundless and baseless charges.

33. Said "Suppressive Person Declare Gerry Armstrong" was read by individuals and third persons in or about February and April of 1982 and thereafter, in the City of Los Angeles, County of Los Angeles. Specifically, Virgil Wilhite, agent/representative/employee of Cross-Defendant SCIENTOLOGY was shown a copy of "Suppressive Person Declare Gerry Armstrong" by Lyman D. Spurlock, Jr., agent/representative/employee of Cross-Defendant RTC. Further, Cross-Complainant was told by Marilyn Brewer, agent/representative/employee of Cross-Defendant SCIENTOLOGY that "Suppressive Person Declare Gerry Armstrong" was widely distributed and that she had received a copy of said Declare from the central communications center of the Cross-Defendants, each - Flag Operations Liaison Organization, located in Los Angeles, California. Cross-Complainant is informed and believes that said "Suppressive Person Declare Gerry Armstrong" was widely distributed by agents/representatives/employees of all Cross-Defendants, but that specific knowledge of said distribution lies with Cross-Defendants, each.

34. As a direct and proximate result of the printing, publication and circulation of the "Suppressive Person Declare Gerry Armstrong" , Cross-Complainant has

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suffered loss of reputation, shame, mortification and hurt, feelings in a sum which is presently unascertained and Cross-Complainant will ask cleave of Court to amend this Cross-Complaint when same has been ascertained.

35. The above-described publication was printed, published and circulated by Cross-Defendants, each, becuse of their feelings of hatred and ill-will toward Cross-Complainant and with a desire to oppress Cross-Complainant and thus the awarding of exemplary and punitive damages in the amount of Fifteen Million ($15,000,000.00) Dollars is justified.

FOURTH CAUSE OF ACTION

(For Breach of Contract Against Cross-Defendants SCIENTOLOGY and HUBBARD)

36. Cross-Complainant repeats and realleges Paragraphs 1 thorugh 21 as though fully set forth herein and further alleges:

37. In or about 1971 Cross-Defendants, each, entered into an oral contract with Cross-Complainant, wherein Cross-Defendants, each, and their agents/representatives/employees, including Graham Leese, Kingsley wimbush, Helen Pollen, Dorothy Knight, Jan Norton, and Anne Tasket, promised Cross-Complainant through oral representations that if Cross-Complainant joined Scientology and took and paid for various courses and auditing, the following benefits were scientifically guaranteed:

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(a) A cure of health problems and disease;

(b) Higher I.Q.;

(c) Family unity cind preservation of marriage;

(d) Improvement of eyesight;

(e) A cure of all neuroses, mental and physical problems;

(f) Improvement of career opportunity.

38. To further induce Cross-Complainant into entering an agreement with Cross-Defendants, each, it was promised and represented to Cross-Complainant that:

(a) Cross-Defendant SCIENTOLOGY is an educational, scientifical, non-profit organization, abiding by the laws of the united States governing non-profit organizations, dedicated to the well-being of mankind and engaged in lawful, educational and scientific research, study and practices;

(b) Cross-Defendant HUBBARD was a nuclear physicist and a medical doctor with degrees from George Washington University and Princeton University; that Cross-Defendant HUBBARD was a war hero, severely wounded after serving four years in actual combat in the South Pacific from 1941 through 1944; and that Cross-Defendant HUBBARD cured himself through auditing while spending one year in a military hospital for wounds including blindness from an exploding shell received in combat.

(c) That "auditing" was completely confidential.

39. Although Cross-Defendants, each, initially made said representations in or about 1971, the same

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representations were continuously repeated to Cross-Complainant from 1971 through December, 1981, in an effort to induce cross-complainant to remain in Scientology, to work for Cross-Defendants, each, for little or no pay, and to take more and more courses and auditing for money to achieve the "scientifically guaranteed" benefits promised.

40. At all times with respect to said continuing oral contract, Cross-Defendants, each, promised and represented to Cross-Complainant that Cross-Defendants, each, fully intended to fulfill the terms of said contract and provide Cross-Complainant with the aforementioned scientifically guaranteed benefits.

41. At all times with respect to said continuing contract, and during the eleven years Cross-Complainant was in Scientology, Cross-Complainant reasonably believed the aforementioned representations made by Cross-Defendants, each, and in reliance thereon performed all of the terms and conditions on his part to be performed in that Cross-Complainant:

(a) invested eleven years of his life laboring an average of 80 hours per week for Cross-Defendants, each, without just compensation;

(b) Forfeited formal education;

(c) Made personal disclosures about Cross-Complainant's life during intensive "auditing" sessions, which Cross-Complainant was promised would remain confidential and which

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Cross-Defendants, each, thereafter disclosed to third persons;

(d) Underwent courses and "auditing" for which Cross-Complainant paid money to Cross-Defendants, each, in a sum presently unascertained, but Cross-Complainant will ask leave of Court to amend this Cross-Complaint when the same has been ascertained;

(e) Strictly adhered to all of the representations and requirements of Cross-Defendants, each, in order to obtain the scientifically guaranteed benefits,

42. Cross-Defendants, each, breached said contract in that Cross-Defendants, each, have retained the monies paid by Cross-Complainant, have failed to provide any of the aforementioned scientifically guaranteed benefits to Cross-Complainant, have breached all confidences regarding Cross-Complainant's auditing, and have further engaged in intimidating and harassive tactics against Cross-Complainant.

43. As a direct and proximte result of Cross-Defendants', each, breach of contract, Cross-Complainant has sustained damage in a sum which is presently unascertained, but Cross-Complainant will ask leave of Court to amend this Cross-Complaint when the same has been ascertained.

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FIFTH CAUSE OF ACTION

(Tortious Interference With Contract Against Cross-Defendants SCIENTOLOGY, SCIENTOLOGY INTERNATIONAL and RTC)

44. Cross-Complainant repeats and realleges Paragraphs 1 through 21 as though fully set forth herein and further alleges:

45. In or about January of 1980, at Los Angeles, California, Cross-Complainant and Cross-Defendant HUBBARD entered into a written contract whereby Cross-Complainant agreed to assemble information and documentation, as well as do research for a biography to be written about Cross-Defendant HUBBARD. On or about January 8, 1S30, Cross-Complainant forwarded a Petition to Cross-Defendant HUBBARD to approve Cross-Complainant as a "Biography- Researcher" for a project which ultimately involved the completion of a biography of Cross-Defendant HUBBARD. A copy of said Petition is attached hereto as Exhibit "B". Thereafter, in January of 1980, Cross-Defendant HUBBARD wrote to Cross-Complainant and stated in substance that the Petition was approved and that Cross-Defendant HUBBARD was pleased Cross-Complainant had located old records thought to be stolen in 1953. Cross-Complainant is informed and believes that the document approving the Petition is in the possession of Cross-Defendant SCIENTOLOGY.

46. From 1980 until April of 1982, a period of about 30 months, Cross-Complainant performed his portion of

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the contract by collecting and collating materials and documentation about Cross-Defendant HUBBARD and providing the same to the biographer, Omar V. Garrison; by interviewing persons with biographical knowledge of Cross-Defendant HUBBARD; by collecting manuscripts and other writings of Cross-Defendant HUBBARD, among other things, for which Cross-Complainant was paid. Cross-Complainant would have continued to perform the aforementioned duties, but was prevented from doing so by Cross-Defendants, each, interference and acts hereinafter alleged.

47. At all times herein mentioned, Cross-Defendants, each, had knowledge of the contract between Cross-Complainant and Cross-Defendant HUBBARD and of Cross-Complainant's position of Archivist. In spite of such knowledge and with malicious intent to induce Cross-Defendant HUBBARD to terminate such contract without just cause, Cross-Defendants, each, declared Cross-Complainant a "Suppressive Person" and charged Cross-Complainant with various crimes including, but not limited to, "theft", "illegally taking or possessing Church property" and "promulgating false information about the Church, its Founder and members"(see Exhibit "A" attached hereto). Cross-Defendants, each, further induced HUBBARD upon the false grounds set forth in the Suppressive Person Declare, to breach the contract with Cross-Complainant and to dissafirm and deny to Cross-Complainant all of his rights and interest as Biography Researcher, all for the purpose of depriving

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Cross-Complainant of his rights under the contract and preventing Cross-Complainant from fulfilling the contract and receiving compensation therefore.

48. As a proximate result of such inducement by Cross-Defendants, each, Cross Defendant HUBBARD breached the contract with Cross-Complainant without just cause preventing Cross-Complainant from completing the terms of the contract and from collecting any compensation from Defendant HUBBARD under said contract.

49. As a direct and proximate result of Cross-Defendants', each tortious interference with the contract, Cross-Complainant sustained damage in a sum which is presently unascertained, but Cross-Complainant will ask leave of Court to amend this Cross-Complaint when the same has been ascertained.

50. In doing the acts herein alleged, Cross-Defendants, each, acted with oppression, fraud and malice, and Cross-Complainant is entitled to punitive damages in the sum of Fifteen Million ($15,000,000.00) Dollars. WHEREFORE, Cross-Complainant prays for judgment against Cross-Defendants, each, as follows:

FIRST CAUSE OF ACTION

1. General damages according to proof;

2. Punitive damages in the sum of Fifteen Million ($15,000,000.00) Dollars;

SECOND CAUSE OF ACTION

3. General damages according to proof;

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4. Punitive damages in the sum of Fifteen Million ($15,000,000.00) Dollars;

THIRD CAUSE OF ACTION

5. General damages according to proof;

6. Punitive damages in the sum of Fifteen Million ($15,000,000.00) Dollars;

FOURTH CAUSE OF ACTION

7. Compensatory damages according to proof with interest thereon;

FIFTH CAUSE OF ACTION

8. Compensatory damages according to proof with interest thereon;

9. Punitive damages in the sum of Fifteen Million ($15,000,000.00) Dollars;

ALL CAUSES OF ACTION

10. For costs of suit incurred herein; and

11. For such other and further relief as this Court may deem just and proper.

DATED: June 30, 1983
CONTOS & BUNCH
By:
BRUCE M. BUNCH
Attorneys for Defendant and Cross-Complainant GERALD ARMSTRONG

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