Freestone’s Response and Brief in Opposition of Defendants' Motion to Dismiss for Failure to Join an Indispensable Party (“Response”) was very well put together. The legal counsel I consulted with thinks that Freestone has a strong argument contained within their Response. Let me begin with brief recap of events.
Recap
Feuerborn, Jennings, Shultz and ESSI (“Defendants”) filed a Motion to Dismiss for Failure to Join an Indispensable Party (“Motion to Dismiss”) approximately three weeks ago. This was a second attempt to get the Civil Case dismissed. Their first motion to dismiss was denied by the Court, so they attempted another stall tactic to avoid answering the lawsuit. (Note: It’s difficult to answer a lawsuit when you know you lied and committed fraud.) Freestone has presented numerous exhibits where Feuerborn and Shultz sent emails claiming that the Solvent Technology is non-toxic and environmentally safe. Freestone has also presented a Material Safety Data Sheet given to them by the Defendants that makes the Solvent Technology appear as safe as water when we all know it’s very toxic.
The Defendants filed their Motion to Dismiss, because they felt that Earth Oil Services (“EOS”) (the company that was purchased by Freestone from the Defendants) was an indispensable party to the Civil Case. EOS is a Nevada corporation and Freestone is a Nevada corporation. In a Federal lawsuit you are required to have a complete diversity of jurisdiction; simply put, the Plaintiff and the Defendants must not be in the same state. The Defendants are attempting to attach EOS to the lawsuit so that complete diversity jurisdiction does not exist, and thus the Civil Case would be dismissed on a technicality. This is just another attempt to throw something against the wall to see if it sticks so that the Civil Case does not produce evidence that the U.S. Attorneys can use in the Criminal Case against Feuerborn and Jennings.
Freestone’s Response
In Freestone’s Response they are essentially arguing that (i) EOS was never a party to the agreement signed by the Defendants and Freestone, (ii) no further relief could be granted by the court if EOS was a party to this lawsuit, and (iii) nothing ever occurred in the EOS entity. There is case law cited within the Response that supports Freestone’s argument, and it looks like there are multiple precedence in favor of Freestone.
Here are some common sense factors as well:
If Freestone owns 100% of the shares in EOS, and if EOS was a party to the lawsuit, then wouldn’t Freestone be suing itself? That doesn’t make any sense.
If someone buys a defective product (in this case EOS), and they want their money back, then they sue the person that sold them the defective product. Why would the Court require the defective product to be involved in the lawsuit? This is how it was explained to me:
Let’s say that you (a Texas resident) purchase a car (located in Texas) from your friend (a California resident). Your friend represents that the car is in perfect working condition. After you purchase the car you find out that it won’t even turn on. Your friend refuses to give you your money back so you sue him. Then your friend tries to require the Court to attach the car to the lawsuit (because the car is located in Texas and you are a Texas resident) in a frivolous attempt to get the case dismissed. What relief, monetarily or otherwise, can you get from the car? You can’t, and thus it would not be an indispensable party.
There is also a three part test (rule 19 (a)) to determine if a party is “indispensable” and Freestone argues that EOS is not a required party through this test. The Judge will probably see this Motion to Dismiss for what it is (another stall tactic), and deny this second attempt to dismiss. It’s too bad that these dirty tricks can be used to stall a lawsuit that has a lot of merit. I guess it all comes down to ethics, and if the Defendants had any ethics then there wouldn’t be a need for the Criminal and Civil Cases in the first place.
Merry Christmas, and may we all have a justice filled New Year!
-ESS Investor
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