IN THE SUPERIOR COURT OF APPEAL OF THE STATE OF CALIFORNIA

IN AND FOR THE COUNTY OF MARIN

BEFORE THE HONORABLE GARY W. THOMAS

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CHURCH OF SCIENTOLOGY INTERNATIONAL, PLAINTIFF, VS. GERALD ARMSTRONG, ET AL., DEFENDANTS

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NO. 157680

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REPORTER'S TRANSCRIPT OF THE PROCEEDINGS

FRIDAY, OCTOBER 6, 1995

APPEARANCES:

FOR THE PLAINTIFF:	ANDREW H. WILSON WILSON, RYAN & CAMPILONGO 115 SANSOME STREET FOURTH FLOOR SAN FRANCISCO, CA 94104 LAURIE J. BARTILSON MOXON & BARTILSON 6255 SUNSET BOULEVARD SUITE 2000 HOLLYWOOD, CA 90028
FOR THE DEFENDANTS:	FORD GREENE 711 SIR FRANCIS DRAKE BOULEVARD SAN ANSELMO, CA 94960
REPORTED BY: ELAINE PASSARIS, C.S.R. CERTIFICATE NO. 2948

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FRIDAY, OCTOBER 6, 1995

MORNING SESSION

P R O C E E D I N G S

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THE COURT: WE DO HAVE THE CHURCH OF SCIENTOLOGY VERSUS GERALD ARMSTRONG.

MR. WILSON: GOOD MORNING, YOUR HONOR. ANDREW WILSON AND LAURIE BARTILSON ON BEHALF OF PLAINTIFF AND MOVING PARTY, THE CHURCH OF SCIENTOLOGY

MR. GREENE: AND FORD GREENE ON BEHALF OF DEFENDANT, GERALD ARMSTRONG. IT WAS AT MY REQUEST THAT THIS HEARING IS BEING HELD.

THE COURT: YES. MR. GREENE, WHAT DO YOU HAVE TO SAY?

MR. GREENE: FIRST, YOUR HONOR, WITH RESPECT TO YOUR TENTATIVE RULING, I WANT TO DIRECT MY ARGUMENT TO YOUR HOLDING THAT THE FACTS SUBMITTED BY ARMSTRONG DO NOT ESTABLISH A MUTUAL CONFIDENTIALITY REQUIREMENT. THE INTERPRETATION OF THE COURT OF THE SETTLEMENT AGREEMENT AS REFLECTED BY THE TENTATIVE RULING WOULD HAVE THE RESULT THAT SCIENTOLOGY COULD PUBLICLY ACCUSE MR. ARMSTRONG OF BEING A LIAR, A PERJUROR AND AN AGENT PROVOCATEUR OF THE FEDERAL GOVERNMENT, AND THAT IF ARMSTRONG TOOK ANY ACTION IN RESPONSE THAT THE RESULT WOULD BE THAT HE WOULD VIOLATE THE PROPOSED PERMANENT INJUNCTION AND WOULD BE SUBJECT TO BEING JAILED FOR CONTEMPT OF A COURT ORDER.

WHAT THE COURT HAS MISSED IN THE TENTATIVE RULING IS THE EVIDENCE THAT ARMSTRONG HAS SUBMITTED FROM

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SCIENTOLOGY'S OWN COUNSEL, LAWRENCE HELLER, WHO THE COURT WILL RECALL WAS THE LAWYER WHO WAS PRESENT AT THE SIGNING OF THE SETTLEMENT AGREEMENT, AND HELLER'S OWN SWORN TESTIMONY AS SET FORTH IN SEPARATE FACTS 101 AND 102, WHICH THE COURT DID NOT ADDRESS AND DID NOT INCLUDE IN THE TENTATIVE RULING, STATES THAT THE CONFIDENTIALITY PROVISIONS WERE MUTUAL, THAT THEY WERE INSISTED UPON BY ALL PARTIES, AND THAT THEY PERTAINED NOT ONLY TO ANY INFORMATION THAT THE FORMER SCIENTOLOGY OFFICIAL POSSESSED WITH RESPECT TO THAT ORGANIZATION, BUT IT ALSO PERTAINED -- THE CONFIDENTIALITY PROVISION PERTAINED WITH RESPECT TO INFORMATION HELD BY SCIENTOLOGY AS TO ITS FORMER PARISHIONER OR FORMER OFFICIAL.

THAT SINGLE PIECE OF EVIDENCE IS SUFFICIENT UNDER THE CIRCUMSTANCES AND WITH RESPECT TO A 437(C) MOTION TO RAISE A TRIABLE ISSUE OF FACT.

WHAT THE COURT HAS DONE BASED ON THE TENTATIVE RULING HAS BEEN SOLELY TO BASE ITS ANALYSIS ON THE FOUR CORNERS OF THE DOCUMENT AND HAS NOT LOOKED AT ALL TO WHAT THE CIRCUMSTANCES WERE WHICH SURROUNDED THE PARTIES ENTERING INTO THE AGREEMENT, AND ALSO HAS NOT LOOKED AT THE CONDUCT OF THE PARTIES SUBSEQUENT TO THE AGREEMENT, AND THE AUTHORITY WITH RESPECT TO SUBSEQUENT CONDUCT IS -- THAT IS AUTOMOBILE SALES VERSUS EAST BAY MOTOR CAR DEALERS, 10 CAL.APP.3RD 419.

BASICALLY WHAT THAT TALKS ABOUT IS EVEN IF THE LANGUAGE IN A PARTICULAR AGREEMENT APPEARS ON ITS FACE CLEAR, WHICH WE --

THE COURT: NOW, MR. GREENE, THE STATEMENT BY

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ARMSTRONG IN HIS DECLARATION, FACT ONE-H, SAYING MY CAREFUL WEIGHING OF MY OPTIONS, THIS IS HIS WORDS, IN FACT REFLECTS THE DURESS I WAS UNDER TO SIGN AND IS NOT REFLECTIVE OF AN ABSENCE OF DURESS --

MR. GREENE: THAT'S A DIFFERENT ARGUMENT.

THE COURT: -- DOUBLE SPEAK --

MR. GREENE: THAT'S A DIFFERENT ARGUMENT. I'M NOT ADDRESSING MYSELF TO THE DURESS ARGUMENT. I'M NOT ADDRESSING MYSELF TO THE ARGUMENT OF ALL OF THE KINDS OF CONDUCT THAT ARMSTRONG --

THE COURT: CAREFUL WEIGHING OF OPTIONS --

MR. GREENE: I UNDERSTAND.

THE COURT: -- IS TO BE INCONSISTENT WITH THE ABSENCE OF THE FREE EXERCISE OF WILL.

MR. GREENE: THAT'S NOT MY ARGUMENT. I'M TALKING ABOUT THE MUTUALITY, BECAUSE IF THE AGREEMENT ACCORDING TO ATTORNEY HELLER, WHO STATED UNDER PENALTY OF PERJURY REPRESENTING CSI WHO'S THE PARTY HERE IN A MOTION TO QUASH ARMSTRONG'S DEPOSITION TESTIMONY IN ANOTHER CASE BEFORE THIS LAWSUIT WAS EVER FILED, BEFORE THERE WAS ANY DISPUTE ABOUT THE SETTLEMENT AGREEMENT, HELLER SAYS THIS WAS MUTUAL, BOTH PARTIES SOUGHT IT.

BOTH PARTIES WERE TO MAINTAIN SILENCE AND NOT SAY A DOGGONE THING ABOUT ONE ANOTHER, AND THAT SPECIFIC EVIDENCE IS FOUND AT ARMSTRONG'S EVIDENCE ONE-AD. THAT'S A DECLARATION FROM THE VERY LAWYER WHO WAS PRESENT AT THE SIGNING OF THE SETTLEMENT AGREEMENT AND WHO ALSO SAYS I WAS PERSONALLY INVOLVED IN THE NEGOTIATIONS WHICH RESULTED IN

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THIS SETTLEMENT AGREEMENT.

SO I'M NOT TALKING ABOUT DURESS. I'M NOT TALKING ABOUT FRAUD YET. I'M TALKING ABOUT MUTUALITY, AND THAT I'M TALKING ABOUT THE GOOSE AND GANDER RULE AND THAT WHAT WAS GOOD FOR --

THE COURT: THERE'S NO SUCH RULE NOW.

MR. GREENE: WELL, THAT'S WHAT YOUR TENTATIVE RULING --

THE COURT: THAT'S --

MR. GREENE: -- CLEARLY INDICATES.

THE COURT: -- OTHER PERSONS NOW.

MR. GREENE: JUDGE, YOU DO A VERY GOOD JOB OF ALMOST DERAILING ME.

THE POINT IS THAT THE COURT DIDN'T LOOK AND DIDN'T INCORPORATE THOSE FACTS AND THOSE FACTS ARE NOT DISPUTED. THAT'S NUMBER ONE. ACCORDING TO THE CASE LAW THAT THE SUBSEQUENT CONDUCT OF THE PARTIES TO AN AGREEMENT IS VERY RELIABLE EVIDENCE OF WHAT THEIR INTENTIONS WERE IN ENTERING INTO THE AGREEMENT, AND THAT'S WHAT THE COURT HAS TO DO FIRST IS TO ASCERTAIN WHAT WAS THE INTENTIONS OF THE PARTIES, AND IN ORDER TO DO THAT THE COURT'S GOT TO PUT ITSELF IN THE SHOES OF THE PARTIES AT THE TIME THE AGREEMENT WAS ENTERED INTO, AND THAT LEADS ME TO THE SECOND SUPPORTING ARGUMENT WITH RESPECT TO THE RECIPROCAL NATURE OF THE KEEP QUIET PROVISIONS, AND THAT'S BASED ON CIVIL CODE SECTION 1647.

THE COURT: WELL, IS THERE SOMETHING IN THE CONTRACT THAT'S SO DIFFICULT TO EXPLAIN THAT HAS TO BE

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EXPLAINED BY ACTIONS?

MR. GREENE: YES.

THE COURT: WHAT IS IT?

MR. GREENE: THERE IS.

THE COURT: BASICALLY KEEP YOUR MOUTH SHUT. WE GAVE YOU $800,000 DOLLARS.

MR. GREENE: AH, BUT SEE, THAT'S -- I KNOW THAT, JUDGE, AND THAT'S BEEN THE STICKING POINT IN MY PERCEPTION OF YOUR VIEW OF ARMSTRONG AND THIS CASE ALL THE WAY ALONG.

HE GOT $800,000 BUCKS SO HE DOGGONE WILL -- BETTER KEEP HIS MOUTH SHUT.

THE COURT: AND IT'S IN THE AGREEMENT. IF YOU OPEN YOUR MOUTH, YOU HAVE TO PAY BACK $50,000 EVERY TIME.

MR. GREENE: BUT -- WELL, THAT'S -- YET THE LIQUIDATED DAMAGES?

THE COURT: HE OPENED HIS MOUTH AND NOW THEY WANT $50,000 PER EACH TIME.

MR. GREENE: JUDGE --

THE COURT: THAT'S THE SUBJECT OF ACTS OF THE CHURCH.

MR. GREENE: JUDGE, THE ADDITIONAL -- WHAT THE COURT DIDN'T DO AND THE AUTHORITY IS PG&E VERSUS G.W. THOMAS GRANGE --

THE COURT: YES, NO RELATION TO ME, ALTHOUGH I LIKED SEEING THAT IN THE STREETS OF SAN FRANCISCO YEARS AGO.

MR. GREENE: -- 69 CAL.2D, 33, DISCUSSES --

THE COURT: I ASKED MY FATHER, AND HE ADVISED ME I WASN'T NAMED AFTER HIM EITHER.

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MR. GREENE: -- DISCUSSES THAT THE COURT NEEDS TO LOOK AT THE OBJECT NATURE AND SUBJECT MATTER OF THE CONTRACT SO THAT IT CAN PLACE ITSELF IN THE POSITION OF THE PARTIES.

AND WHAT IS BEFORE THE COURT IS THAT AS OF DECEMBER 6TH, 1986, ARMSTRONG HAD BEEN JUDICIALLY CREDITED BY JUDGE BRECKENRIDGE (SIC) AS BEING TRUTHFUL AND AS BEING ACCURATE. SCIENTOLOGY IN THE SAME DECISION HAD BEEN JUDICIALLY FOUND TO BE FULLY CAPABLE OF INTIMIDATION OR OTHER PHYSICAL OR PSYCHOLOGICAL ABUSE IF IT SOUGHT -- IF IT LED TO THE ENDS THAT THEY SOUGHT. JUDGE BRECKENRIDGE (SIC) ALSO --

THE COURT: NOW, THE OTHER SIDE SAYS IN ESSENCE IF ONE ACCEPTS YOUR ARGUMENT, ONE IS FACED WITH THE UNESCAPABLE CONCLUSION, YOUR CLIENT, HE MADE A PROMISE WITHOUT THE INTENTION OF PERFORMING IT.

MR. GREENE: SEE, THE PROBLEM IS, JUDGE, THAT ARMSTRONG --

THE COURT: THEY DID PERFORM, THE OTHER SIDE, BECAUSE THEY GAVE THE $800,000.

MR. GREENE: THE PROBLEM WITH THAT ARGUMENT AND THAT VIEW IS THAT IT OCCLUDES ANY REFERENCE TO THE FACT THAT ARMSTRONG AT THE TIME OF THIS SETTLEMENT AGREEMENT HAD A PENDING CROSS-COMPLAINT AND THAT CROSS-COMPLAINT INCLUDED BEING RUN OVER BY A CAR DRIVEN BY AGENTS OF SCIENTOLOGY, INVOLVED IN FREEWAY ACCIDENTS IN VEHICLES DRIVEN BY SCIENTOLOGY, SURVEILED, SPIED ON, AND HARASSED. IN LESS THAN FIVE MONTHS PRIOR TO THE POINT THAT THIS CASE -- THAT THE SETTLEMENT AGREEMENT WAS ENTERED INTO AND ARMSTRONG

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AGREED TO DISMISS HIS CROSS-COMPLAINT THAT WAS BASED ON CONDUCT OF THAT SORT, AN L.A. COUNTY JURY HAD AWARDED $30 MILLION DOLLARS ON BEHALF OF LARRY WASHORN (SIC) [WOLLERSHEIM] ON BEHALF OF SCIENTOLOGY.

IT'S NOT THAT ARMSTRONG WAS PAID $800,000 DOLLARS IN ORDER TO KEEP HIS MOUTH SHUT. HE WAS PAID $800,000 DOLLARS TO DISMISS HIS CROSS-COMPLAINT, AND IT WAS RECIPROCALLY AGREED BETWEEN SCIENTOLOGY AND ARMSTRONG THAT BOTH OF THEM WOULD KEEP THEIR MOUTHS SHUT, AND WHEN SCIENTOLOGY DIDN'T, WHEN SCIENTOLOGY WAS OUT IN PUBLIC AND IN COURT STAYING ARMSTRONG'S A LIAR, ARMSTRONG'S A PERJUROR, ARMSTRONG'S A PROVOCATEUR, WAS INVOLVED IN SOME GOVERNMENTAL CONSPIRACY TO TRY TO TAKE OVER THE CHURCH OF SCIENTOLOGY, THEN AT THAT POINT, THE REQUIREMENT FOR HIM TO CONTINUE TO ADHERE TO THE SILENCE PROVISIONS AS THEY PERTAINED TO HIM NO LONGER EXISTED.

SO IT'S NOT NEARLY SO SIMPLE THAT GERALD ARMSTRONG WAS JUST SORT OF OUT IN LIFE AND ACCEPTED ALMOST A MILLION DOLLARS TO KEEP HIS MOUTH SHUT. HE ACCEPTED -- AND YOU LOOK ALSO, JUDGE, AT SCIENTOLOGY'S OWN EVIDENCE WHICH IS THEIR OWN EVIDENCE AT EXHIBIT ONE-C AT PAGES FOUR AND FIVE, AND THAT WAS THE VALUATION OF ALL OF MICHAEL FLYNN'S CLIENTS, SOME TWENTY CLIENTS THAT WERE ENGAGED IN THIS GLOBAL SETTLEMENT ALL OF WHICH --

THE COURT: NOW, MR. GREENE, OF COURSE, THE PAPERS SUBMITTED HAS THE LOS ANGELES SUPERIOR COURT ORDER.

YOU'VE REFERRED TO LOS ANGELES AND WHAT'S TAKEN PLACE THERE.

THE ORDER SAYS, THE QUOTE IS, THE AGREEMENT TERMS ARE CLEAR

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AND UNAMBIGUOUS. THE CROSS-COMPLAINANT UNDERSTOOD, THAT'S YOUR CLIENT, UNDERSTOOD THE TERMS AND SIGNED IT. THE DUTIES, OBJECTIONS, OBLIGATIONS OF AGREEMENT ARE CLEARLY STATED. MUTUALITY AND RECIPROCAL DUTIES CANNOT BE READ INTO THE UNAMBIGUOUS TERMS OF THE AGREEMENT. THERE ARE NO PROVISIONS IN THE AGREEMENT PROHIBITING THE CROSS-DEFENDANT FROM REFERRING TO CROSS-COMPLAINANT WITH THE PRESS OR IN LEGAL PLEADINGS OR DECLARATIONS.

MR. GREENE: WELL, JUDGE, IT'S NOT REALLY FAIR FOR TO YOU RELY ON THAT, BECAUSE A GRANT OF A MOTION FOR PRELIMINARY INJUNCTION --

THE COURT: WELL, NOW, I AGREE THAT THE RULING IS NOT THE LAW OF THE CASE.

MR. GREENE: OKAY. YOU ALSO HAVE ANOTHER JUDGE FROM THE SAME COURT SAYING THAT THIS IS THE MOST AMBIGUOUS ONE-SIDED UNFAIR AGREEMENT HE'D EVER SEEN, AND IF IT HAD BEEN SUBMITTED TO HIM HE WOULDN'T HAVE -- OR TO JUDGE BRECKENRIDGE (SIC) THE ORIGINAL JUDGE WHO PRESIDED OVER THE TRIAL WHERE SCIENTOLOGY ORIGINALLY SUED ARMSTRONG, HE WOULDN'T HAVE ENFORCED ANY OF IT.

SO WE CERTAINLY HAVE ACCURACIES IN THE EYE OF THE BEHOLDER, AND JUST BECAUSE ONE JUDGE SAYS THAT THIS IS UNAMBIGUOUS DOESN'T MEAN ANOTHER JUDGE IS GOING TO DO IT, AND YOU HAVE TO INDEPENDENTLY DECIDE, AND BASED ON YOUR TENTATIVE RULING, YOU DIDN'T LOOK AT LAWRENCE HELLER'S DECLARATION WHERE HE SAYS UNDER OATH REPRESENTING CSI THAT IT WAS A MUTUAL PROVISION, AND THAT'S WHAT IS THE SINGLE MOST GLARING OMISSION, WITH ALL DUE RESPECT, IN YOUR

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TENTATIVE RULING, IS THAT YOU DON'T TAKE THAT INTO YOUR EVALUATION AT ALL. YOU LOOK AT THE FOUR CORNERS, AND YOU SAY THAT PROVISION SEVEN-I, THE CLEAN SLATE PROVISION, ONLY APPLIES IF THERE'S LITIGATION AMONG THE PARTIES SO THERE'S NO VIOLATION WITH RESPECT TO THAT ON SCIENTOLOGY'S SIDE, AND THEN WITH RESPECT TO 18-D, DON'T TELL ANYBODY ABOUT THE EXISTENCE OF THIS SETTLEMENT AGREEMENT, THAT WASN'T VIOLATED EITHER.

I MEAN ARMSTRONG'S PUT IN THE POSITION WHERE HE FINDS OUT THAT SCIENTOLOGY IS ACTIVELY CONDUCTING AN APPEAL IN HIS OWN CASE THAT HE BY THIS AGREEMENT IS PROHIBITED FROM OPPOSING, AND HE GOES TO THE COURT OF APPEAL AND HE SAYS COURT OF APPEAL, THIS IS THE AGREEMENT, I'M GIVING IT TO YOU UNDER SEAL, IT SAYS THAT I CAN'T PARTICIPATE IN MY OWN APPEAL, BUT I WANT TO ANYWAY. THE COURT OF APPEAL SAYS YES, YOU CAN. THAT IS NOT CLEAR.

THAT'S IN THE RECORD HERE. THAT WAS NOT CONSIDERED BY THE COURT, AND FOR THE PURPOSES OF SUMMARY JUDGMENT IT'S TOO SOON AND IT'S TOO FAST, BECAUSE IT'S NOT SO CLEAR CUT. AND JUDGE, GERHARDT (SIC) WHEN SCIENTOLOGY FIRST SOUGHT TO ENFORCE THIS AGREEMENT UNDER THE RUBRIC OF THE ORIGINAL SCIENTOLOGY LITIGATION, IT'S THAT ON THE RECORD AND IT'S IN EVIDENCE BEFORE THE COURT, HE SAID THIS AGREEMENT --

THE COURT: YES, YOU'VE ARGUED THAT FOR A LONG TIME NOW. SOMETHING YOU WANT TO SAY IN RESPONSE?

MR. WILSON: VERY BRIEFLY. WHAT'S REALLY HAPPENED HERE IS THAT THERE HAVE BEEN SEVERAL COURTS THAT

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HAVE APPLIED THE GANDER RULE THAT TOOK A GANDER AT THE AGREEMENT, REALIZED IT WASN'T AMBIGUOUS, AND HELD THAT IT WAS ENFORCEABLE, HELD THAT THERE WAS NO SUCH MUTUALITY, THAT THE CONFIDENTIALITY PROVISIONS WENT ONE WAY, JUDGE HOHIGIN (SIC) [SOHIGIAN] AWARDED US A PRELIMINARY INJUNCTION. THAT WAS AFFIRMED BY THE COURT OF APPEAL. JUDGE HORSICKS (SIC) [HOROWITZ] FROM LOS ANGELES GRANTED SUMMARY JUDGMENT ON SEVERAL CAUSES OF ACTION. YOU GRANTED SUMMARY JUDGMENT ON SEVERAL CAUSES OF ACTION PREVIOUSLY IN, I BELIEVE, DECEMBER, AND NOW YOU GRANTED SUMMARY JUDGMENT AGAIN WITH THE AGREEMENT IN PROPERLY DECIDING THAT YOU CAN LOOK AT THE FOUR CORNERS AND YOU CAN SEE THAT THERE'S NO SUCH MUTUALITY PROVISION.

AS FAR AS THE HELLER DECLARATION IS CONCERNED, MR. GREENE MISREPRESENTS WHAT'S IN THERE. IT DOESN'T SAY THAT BOTH PARTIES WANTED THE MUTUALITY OF THE CONFIDENTIALITY.

I THINK THAT THIS MATTER HAS BEEN ARGUED ENOUGH, AND I REALLY DON'T THINK IT NEEDS ANY FURTHER ARGUMENT.

MR. GREENE: I'VE GOT HELLER'S PAPERS RIGHT HERE IF THE COURT WANTS TO LOOK AT EXACTLY WHAT THEY SAY, AND I'M SORRY, MR. WILSON, YOU'RE WRONG. WITH RESPECT TO THE COURT OF APPEALS REVIEW OF THE PRELIMINARY INJUNCTION, THE COURT OF APPEAL SPECIFICALLY AND EXPRESSLY WITHHELD ANY DETERMINATION OF THE ENFORCEABILITY OF THE AGREEMENT. IT ONLY LOOKED AT THE INJUNCTION. IT DID NOT EVALUATE AND MAKE A JUDICIAL DETERMINATION WITH RESPECT TO THAT.

SO I WILL ALSO -- IN ARMSTRONG CLEARLY SETS OUT -- JUDGE BRECKENRIDGE (SIC) IN HIS DECISION SAID ARMSTRONG AND

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HIS LAWYER WERE FREE TO TALK ABOUT SCIENTOLOGY. THEY TRIED TO SHUT HIM UP BEFORE, AND HE SAID THEY'RE FREE TO TALK ABOUT ANY OF ARMSTRONG'S EXPERIENCES, ANY OF THE DOCUMENTS THAT WERE IN EVIDENCE, THEY -- THERE'S NO RESTRICTION. SO WHY IN THE WORLD WOULD ARMSTRONG AT THAT POINT IN HIS LIFE AFTER HAVING LITIGATED AGAINST SCIENTOLOGY FOR FIVE YEARS AND THROUGH A THIRTY-DAY COURT TRIAL, COURT TRIAL -- IT WASN'T A JURY TRIAL, WAS A COURT TRIAL -- WHERE THE JUDGE SAYS YOU CAN SAY WHATEVER YOU WANT ABOUT YOUR FORMER RELIGION, YOU CAN SAY WHATEVER YOU WANT TO, AND HE HAD A CROSS-COMPLAINT THAT BY ALL INTENTS AND PURPOSES LOOKED LIKE IT WAS A BELL RINGER, IT WAS SET TO GO TO TRIAL WITHIN THREE MONTHS, AND HE GETS $800,000 BUCKS. HE DIDN'T GET $800,000 BUCKS JUST TO KEEP HIS MOUTH SHUT, GO AWAY INTO THE FIRMAMENT AND SCIENTOLOGY CAN SAY YOU'RE A LIAR, YOU'RE A PERJUROR, YOU'RE THIS AND YOU'RE THAT, AND IF YOU COME OUT OF THE FIRMAMENT, WE'RE GOING TO HAMMER YOU AND GET AN INJUNCTION AND PUT YOU IN JAIL IF YOU OPEN YOUR MOUTH AGAIN.

HE DIDN'T AGREE TO THAT, AND IT'S NOT REASONABLE UNDER THE CIRCUMSTANCES TO CONCLUDE THAT HE HAD THAT INTENT WHEN HE ENTERED INTO THE AGREEMENT, AND SCIENTOLOGY'S OWN EVIDENCE, THEIR OWN EVIDENCE WHICH IS --

THE COURT: WELL, REALISTICALLY, MR. GREENE, FOR THE ARMSTRONG POSITION, THEY SAY THERE'S A MUTUAL CONFIDENTIALITY REQUIREMENT. HE POINTS TO HIS BELIEFS, THE PURPORTED BELIEFS OF HIS ATTORNEY, AND WE HAVE THE STATEMENT MADE BY AN ATTORNEY FOR ONE OF THE SCIENTOLOGY ORGANIZATIONS.

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MR. GREENE: THE PLAINTIFF HERE --

THE COURT: YES, BUT THE FACTS, THOSE FACTS ARE NOT RELEVANT, AND WHEN ONE READS WITKIN, AND YOU CAN READ IT, ONE WITKIN SUMMARY OF CALIFORNIA LAW, IT'S IN SECTION 84, PAGE 617, THE RULES OF INTERPRETATION OF WRITTEN CONTRACTS ARE FOR THE PURPOSE OF ASCERTAINING THE MEANING OF THE WORDS USED THEREIN. EVIDENCE CANNOT BE ADMITTED TO SHOW INTENTION INDEPENDENT OF THE INSTRUMENT. THE WORDS ARE CLEAR.

MR. GREENE: WELL, THE PROBLEM IS, JUDGE, WHEN YOU LOOK AT --

THE COURT: SO WE HAVE -- THE FACT IS THAT ARMSTRONG HASN'T RAISED A TRIABLE ISSUE AS TO WHETHER THE PLAINTIFF BREACHED THE TERM OF THE SETTLEMENT AGREEMENT.

THE OTHER ARGUMENTS WITH REGARD TO OBSTRUCTION OF JUSTICE AND HIS RIGHT TO FREE SPEECH UNDER THE FIRST AMENDMENT, ET CETERA, WELL, THAT ITT CASE HAD DEALT WITH THAT.

MR. GREENE: NO, IT DIDN'T BECAUSE THE ITT CASE --

THE COURT: IT'S POSSIBLE --

MR. GREENE: IT SAYS POSSIBLE, BUT FOR A WAIVER TO BE EFFECTIVE --

THE COURT: IT'S POSSIBLE TO WAIVE EVEN FIRST AMENDMENT FREE SPEECH --

MR. GREENE: FREE SPEECH RIGHTS.

THE COURT: . -- BY CONTRACT.

MR. GREENE: CORRECT. IT SAYS THAT, BUT IT ALSO SAYS THAT IN ORDER FOR THE WAIVER TO BE EFFECTIVE, IT'S

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ESSENTIALLY THE SAME STANDARD AS WHEN YOU ENTERED A GUILTY PLEA IN A CRIMINAL CASE. IT'S GOT TO BE KNOWING, INTELLIGENT, AND VOLUNTARY, AND THERE'S ABSOLUTELY NO EVIDENCE HERE THAT SUCH WAS A CASE, PARTICULARLY IN LIGHT OF HELLER'S DECLARATION, SCIENTOLOGY'S OWN COUNSEL, SAYS BOTH PARTIES WERE SUBJECT TO KEEPING THEIR MOUTH SHUT ABOUT THE OTHERS.

MS. BARTILSON: EXCUSE ME, YOUR HONOR, BUT I HAVE TO JUST DIFFER WITH MR. GREENE'S CHARACTERIZATION OF NO EVIDENCE. THERE IS A VIDEOTAPE OF THE SIGNING OF THE AGREEMENT SHOWING MR. ARMSTRONG SIGNING IT VOLUNTARILY. MR. ARMSTRONG HAS PUT IN DECLARATION AFTER DECLARATION SAYING HE DISCUSSED IT WITH MULTIPLE ATTORNEYS BEFORE HE SIGNED IT. I DON'T THINK THAT THAT'S -- THERE'S EVEN ANY QUESTION OF FACT AS TO WHETHER OR NOT HE ENTERED INTO IT VOLUNTARILY WITH FULL KNOWINGNESS OF THE PROVISIONS.

THE COURT: THERE'S NO REASON TO CHANGE MY TENTATIVE RULING.

MR. GREENE: WELL, BEFORE YOU TELL ME I CAN'T TALK ANYMORE, I WANT TO KEEP --

THE COURT: WELL, THAT'S WHAT I'M SAYING.

MR. GREENE: I WANT TO GIVE YOU ANOTHER CASE, JUDGE, WITH RESPECT TO THEIR OBJECTIONS TO HEARSAY AND YOUR CHARACTERIZATION --

THE COURT: NO.

MR. GREENE: THE EXCEPTION --

THE COURT: NO.

MR. GREENE: -- IS 1241(A) CONTEMPORANEOUS

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STATEMENT BY --

THE COURT: WE'LL GO ON TO BLACK POINT FOREST PROJECT --

MR. GREENE: JUDGE, ALSO --

THE COURT: EXCUSE ME, MR. GREENE.

MR. GREENE: JUDGE --

THE COURT: YOUR MATTER'S OVER.

MR. GREENE -- WITH RESPECT TO --

THE COURT: I'VE GIVEN YOU MORE THAN TWENTY MINUTES. THIS IS A LAW AND MOTION MATTER. TIME IS UP.

MR. GREENE: I UNDERSTAND, JUDGE, BUT THE WAY THAT THIS PRELIMINARY INJUNCTION IS BROADER THAN THE LANGUAGE OF THE CONTRACT ITSELF. IT'S BROADER THAN THE LANGUAGE OF THE CONTRACT ITSELF.

THE COURT: BLACK POINT FOREST VERSUS THE CITY OF NOVATO.

MR. GREENE: AND ALSO IT'S -- AND IT'S WAY BROADER, AND IN ADDITION, IT TAKES MY FILE IN THIS CASE AND YOUR ORDER IS ALSO WRONG BECAUSE YOU'VE STRICKEN --

THE COURT: I'LL HAVE YOU TAKEN AWAY, MR. GREENE.

MR. GREENE: -- YOU'VE STRICKEN HIS EVIDENCE AND YOU'VE DENIED HIS ABILITY --

THE COURT: EXCUSE ME, MR. GREENE.

MR. GREENE: -- TO EVEN APPEAL THIS --

THE COURT: YOU'RE INTERFERING WITH ANOTHER CASE.

MR. GREENE: -- GIVEN --

THE COURT: EXCUSE ME, MR. GREENE.

MR. GREENE: THE BREADTH OF YOUR ORDER AND THE

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EFFECT OF IT, JUDGE, IS THAT YOU'VE MADE IT IMPOSSIBLE FOR ARMSTRONG TO EFFECTIVELY APPEAL. THE INCORRECT DECISION THAT YOU'RE RENDERING NOW, BECAUSE YOU SAY THAT HIS EVIDENCE IS IRRELEVANT AND HAS TO BE STRICKEN --

THE COURT: EXCUSE ME. EXCUSE ME.

(WHEREUPON, PROCEEDINGS WERE CONCLUDED)

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