1 BARRY VAN SICKLE - BAR NO.

98645
1079 Sunrise Avenue
2 Suite B-315
3 Roseville, CA 95661
Telephone (916) 549-8784
4 E-Mail bvansickle@surewest.net
5
Attorney for Plaintiff
6
CLAIRE HEADLEY
7
8
9 UNITED STATES DISTRICT COURT
10 CENTRAL DISTRICT OF CALIFORNIA
11
12 CLAIRE HEADLEY, CV 09-03987 DSF (MANx)
13 Plaintiff, JOINT RULE 26(F) REPORT
14 vs.
CHURCH OF SCIENTOLOGY DATE October 19, 2009
15
INTERNATIONAL, a corporate TIME 1100 am
16 entity, RELIGIOUS PLACE Roybal Federal Building,
17 TECHNOLOGY CENTER, a Courtroom 840
corporate entity AND DOES 1 - 20
18 ASSIGNED TO THE HONORABLE
19 Defendants. JUDGE DALE S. FISCHER
20
21
22
23
24
25
26
27
28
1
PLAINTIFF’S OPPOSITION TO DEFENDANTS’ MOTION TO DISMISS
 1 A. STATEMENT OF THE CASE
2 Plaintiff’s operative Complaint alleges three causes of action. The
3 Complaint was filed in state court and initially based primarily on California law.
4 The Complaint includes an allegation that defendants coerced and intimidated
5 Plaintiff into providing labor and services in violation of 18 U.S.C. 1589. This
6 created federal jurisdiction. Defendants removed the case to this court.
7 The three present causes of action are for restitution of wages under
8 authority of state unfair business practice law, a request for injunctive relief
9 prohibiting coerced abortions by female workers, and the forced labor claim for
10 violations of the federal human trafficking laws and, in particular, the forced
11 labor statute(18 UCS 1589).
12 Plaintiff submits that the forced labor allegations will present questions of
13 fact for a jury. The definition of “serious harm” at 18 USC 1589 (c) (2) is
14 particularly pertinent to Plaintiff’s allegations, although Plaintiff submits that all
15 four means of illegally obtaining labor set forth in section 1589, numbers 1-4 are
16 used by defendants and were used to illegally obtain labor or services from
17 Plaintiff.
18 Plaintiff claims that she was an employee of defendants and was therefore
19 entitled to be paid minimum wage and overtime for her work for defendants. Both
20 defendants controlled Plaintiff’s hours, wages, and working conditions. That is
21 sufficient to create an employee/employer relationship under California state
22 labor laws.
23 The Fair Standards Labor Act (FSLA) presents an alternative and
24 additional requirement that defendant pay employees minimum wage and
25 overtime. The application of the federal law, FSLA, is somewhat more
26 complicated than application of state labor law.
27 The FSLA covers persons engaged in commerce and persons who work for
28 an employer engaged in commerce. Coverage of persons who directly work in
2
PLAINTIFF’S OPPOSITION TO DEFENDANTS’ MOTION TO DISMISS
 1 commerce or production of goods for commerce is called “individual” coverage.
2 Coverage of workers who work for an enterprise involved in commerce is called
3 “enterprise” coverage. See, e.g. 29 CFR 776.0, 776.3, 776.8, 776.9, 776.11, and
4 776.14.
5 Plaintiff contends that she qualifies for coverage as an employee of the
6 Scientology enterprise, and both defendants in particular, under state,
7 “individual” and ‘enterprise” coverage. The law provides three alternative
8 grounds for finding Plaintiff entitled to the protection of labor laws. Plaintiff
9 alleges that she qualifies under all three grounds; however, she only needs to
10 qualify under one of the three types of available coverage to prove entitlement to
11 minimum wage and overtime. See also, Bowrin v. Catholic Guardian Soc., 417 F.
12 Supp. 449, 457-8, 465, & 467 (S.D.N.Y. 2006).
13 Plaintiff contends that, under the state and federal labor laws as properly
14 applied, the nature of defendant’s business, and the entities included within the
15 Scientology enterprise, are only applicable to “enterprise” coverage. However,
16 Plaintiff further contends that the Scientology enterprise, including both
17 defendants as members, qualifies as an “enterprise” under the federal labor laws
18 Therefore, Plaintiff contends that she qualifies for ‘enterprise’ coverage as well as
19 state and ‘individual” coverage.
20 Plaintiff contends that the case most directly on point is Mitchell v. Pilgrim
21 Holiness Church Corp., 210 F.2d.879 (7th Cir. 1954). Mitchell is apparently the
22 source of references in regulations to the rule that a non-profit entity is subject to
23 the federal labor laws if it engages in “commerce”. The commerce in Mitchell
24 was the operation of a printing house and the distribution in interstate commerce
25 of religious materials. This is essentially what CSI and RTC was doing in Golden
26 Era Productions.
27 Further, Plaintiff contends that the Scientology enterprise, including both
28 defendants, have the common business purpose of promoting, selling, and
3
PLAINTIFF’S OPPOSITION TO DEFENDANTS’ MOTION TO DISMISS
 1 stopping competition form selling, the intellectual property of L. Ron Hubbard.
2 RTC and CSI have claimed in litigation that the trademarks, copyrights and trade
3 secrets of Scientology have commercial value. Scientology is not a charitable
4 organization. The Scientology enterprise sells services and training based on the
5 writings of its founder. It collects license fees and other income for allowing
6 some organizations to use Hubbard works while preventing other organizations
7 and persons from using Hubbard’s works. RTC and CSI essentially have a
8 monopoly on certain Hubbard trade marks, copyrights, and purported trade
9 secrets. It generates income by conducting interstate “commerce” in the sale or
10 licensing of Hubbard works. The Scientology enterprise uses “lower level”
11 materials to promote the sale of more expensive “Advanced Technologies” and
12 “confidential” teachings of Hubbard. Millions of dollars are generated in
13 connection with this business. Plaintiff contends that there is much more to the
14 story on the business aspect of scientology, however, just the basics show that it
15 is a commercial enterprise. Accordingly, it must comply with labor laws.
16 Plaintiff anticipates that defendants will claim waiver and religious
17 defenses such as a minister exception. Plaintiff signed her first contract as a
18 minor, was under coercion and intimidation, and had labor law rights that could
19 not legally be waived. Further, Plaintiff was a clerk and office worker with little
20 or no contact with the public or public Scientologists. Plaintiff’s work was not
21 ministerial in nature or function.
22 Plaintiff was coerced into having two abortions to keep her job and avoid
23 punishment. Plaintiff was threatened with serious harm if she did not obey RTC
24 and CSI. It is RTC and its purported Chairman of the Board—COB-- who puts
25 the fear into workers such as Plaintiff.
26 The leader of the Scientology enterprise was, and is, David Miscavige.
27 While he holds the title of COB of RTC, he reports to no board or person. Mr.
28 Miscavige directly, and indirectly through RTC, is the real boss of RTC, CSI, and
4
PLAINTIFF’S OPPOSITION TO DEFENDANTS’ MOTION TO DISMISS
 1 the entire Scientology enterprise. Mr. Miscavige, and his business RTC,
2 ultimately controls wages, hours, working conditions, and punishments used to
3 keep workers such as Plaintiff under his control.
4 B. SUBJECT MATTER JURISDICTION
5 The court has subject matter jurisdiction by reason of the forced labor
6 claim. See 18 USC 1595(a). The forced labor claim is related to the minimum
7 wage claim as both relate to labor and services furnished by Plaintiff to the
8 scientology enterprise under what Plaintiff claims to be illegal conditions.
9 Therefore, the court has supplemental jurisdiction over the state law claims.
10 C. LEGAL ISSUES
11 1. Whether California labor law applies and mandates payment of
12 minimum wage and overtime to Plaintiff for the work in question.
13 2. Whether Plaintiff qualifies for “individual” coverage of the FSLA.
14 3. Whether Plaintiff qualifies for “enterprise’ coverage of the FSLA.
15 4. Whether Plaintiff may recover punitive damages and/or emotional
16 distress damages for forced labor violations.
17 5. Whether the underlying state cause of action under Business &
18 Profession Code 17200 et. seq. accrues upon discovery as under current state law.
19 6. Whether defendants may violate labor laws and avoid responsibility by
20 claiming First Amendment protections.
21 7. Whether the court may enjoin defendants’ practice of forcing pregnant
22 workers to have abortions.
23 8. Whether Plaintiff may waive her rights to minimum and overtime wages.
24 9. Whether restitution recovery for unjust enrichment and labor code
25 violations is limited to contract damages, or is measured by a different standard or
26 rule.
27 The case includes legal issues and disputes on what is relevant. Plaintiff
28 submits that the Sea Org is irrelevant to the case. Plaintiff did not work for the
5
PLAINTIFF’S OPPOSITION TO DEFENDANTS’ MOTION TO DISMISS
 1 Sea Org. Further, the true nature of the Sea Org is disputed. If the Sea Org
2 becomes relevant, Plaintiff will attempt to show the true nature, purpose, history,
3 and activity of the Sea Org.
4 Similarly, Plaintiff contends that not only is the business nature of RTC
5 and CSI relevant, inurement to the boss is also relevant. This would include, in
6 Plaintiff’s view, that the driving goal is to make money and that the wealth of the
7 Scientology enterprise inures to the benefit of its sole leader, David Miscavige.
8 Plaintiff submits that the financial power, significant salary, hidden income, and
9 benefits of running the Scientology empire show the commercial nature of the
10 enterprise and that it is the personal business of Mr. Miscavige. Defendant
11 presumably disagrees.
12 D. PARTIES, EVIDENCE, ETC.:
13 The parties are Plaintiff Claire Headley and defendants RTC and CSI. The
14 potential percipient witnesses are too numerous to list. That could include all of
15 the persons who worked with Plaintiff at Gold Base. Plaintiff submits that there
16 are 15-20 percipient witnesses of importance and that the testimony of several
17 such witnesses would be cumulative.
18 Key percipient witnesses would include Plaintiff in these cases, former
19 executives who have left the group and are willing to speak out such as Marty
20 Rathbun, and witnesses such as Maureen Boustead who were physically
21 restrained when they tried to escape from Gold Base.
22 Key documents would include documents in which defendants refer to
23 Plaintiff and other as ‘employees”, documents that refer to workers having
24 employment contracts, and LRH writings that show the business nature of
25 Scientology including the key directive of making money and selling services,
26 references to pay by LRH, and similar documents. Plaintiff have not conducted an
27 exhaustive search for admissions or other useful documents in the LRH or
28 Scientology library.
6
PLAINTIFF’S OPPOSITION TO DEFENDANTS’ MOTION TO DISMISS
 1 E. DAMAGES
2 Plaintiff seeks full damages at the reasonable value of her services as
3 authorized by the forced labor statute or, alternatively, restitution of at least four
4 years of back pay at minimum wage and overtime rate, with interest under the
5 Business & Professions 17200 claim. Plaintiff also seeks interest, punitive
6 damages for forced labor and attorney’s fees. Using a $10 an hour reasonable
7 value for services rendered, 100 hour weeks, and the California overtime rule,
8 which requires double time after 12 hours and for work in seven days out of
9 seven, puts Plaintiff wage claim in the approximate amount of $100,000 per year
10 before considering interest, penalties or other damages. Plaintiff worked for
11 defendants for over 10 years. Accordingly, just back pay at reasonable rates
12 recoverable under 18 USC section 1595 puts damages in the low seven figures.
13 F. INSURANCE
14 None
15 G. MOTIONS
16 Plaintiff does not presently plan on moving to add parties, amend
17 pleadings, or transfer venue. It should be noted that the court has not ruled on
18 defendants’ motions to dismiss and strike parts of the complaint. Plaintiff may
19 seek to make adjustments in response to the courts’ ruling on submitted motions.
20 The Plaintiff does expect that discovery motions will be needed to address
21 defendants’ anticipated objections to discovery demands.
22 H. MANUAL FOR COMPLEX LITIGATION
23 Not applicable
24 I. STATUS OF DISCOVERY
25 Plaintiff has been deposed one day and two more days are scheduled in
26 early November. Plaintiff’s husband, Plaintiff in a related case, has been deposed
27 for two days in the state court action and one day in this action. Plaintiff
28 responded to numerous document requests prior to removal of this case.
7
PLAINTIFF’S OPPOSITION TO DEFENDANTS’ MOTION TO DISMISS
 1 Plaintiff has requested production of defendants’ entire file on Plaintiff.
2 Defendant has produced documents and withheld documents. Defendant CSI has
3 refused to produce certain types of documents on claim of religious privilege.
4 J. DISCOVERY PLAN
5 Plaintiff plans to take the depositions of David Miscavige, Shelly
6 Miscavige, and the depositions of witnesses disclosed by defendant or suggested
7 by documents produced in discovery.
8 Plaintiff will seek financial records of defendants including records of
9 sales, license fees, trade secret agreements, contract work, salaries, and inurement
10 to David Miscavige. Plaintiff will also seek documentation of the license
11 agreements and similar documents under which RTC and CSI control access to
12 the trademarks, copyrights and purported trade secrets of L. Ron Hubbard.
13 Plaintiff will also seek all documents evidencing an employer/employee
14 relationship between the scientology enterprise and its workers both collectively
15 and individually.
16 K. DISCOVERY CUT-OFF
17 July 1, 2010.
18 L. EXPERT DISCOVERY
19 Plaintiff has not made a final decision on using an expert. Plaintiff
20 contends that an expert is not essential but may assist the jury in understanding
21 the emotional and psychological effects of what Plaintiff experienced as a result
22 of their experiences and observations while working for the Scientology
23 enterprise. Plaintiff requests that expert disclosures be deferred.
24 M. DISPOSITIVE MOTIONS
25 Plaintiff expects to bring motions on the application of the labor laws, and
26 to dispose of affirmative defenses such as waiver, minister exception, and lack of
27 subject matter jurisdiction should the Answer in this case be identical to the
28 answer in the related Marc Headley case.
8
PLAINTIFF’S OPPOSITION TO DEFENDANTS’ MOTION TO DISMISS
 1 N. SETTLEMENT
2 There have been no settlement talks.
3 O. TRIAL ESTIMATE
4 Plaintiff anticipates calling approximately 10 witnesses and reasonably
5 expects that the case will take four weeks for trial. Plaintiff requests a trial by
6 jury.
7 P. TRIAL COUNSEL
8 Barry Van Sickle for Plaintiff.
9 Q. INDEPENDENT EXPERT OR MASTER
10 Not applicable
11 R. TIMETABLE
12 Attached
13 S. OTHER ISSUES
14 This case has unusual issues. There are now a large number of former
15 workers who have potentially relevant evidence, however, an unknown number of
16 the former workers, and potential witnesses, are afraid to speak out. Some have
17 signed “confidentiality’ agreements with penalty clauses labeled liquidated
18 damage agreements, and believe that they can be sued for telling the truth about
19 their scientology adventure. (Plaintiff was forced to sign such an agreement when
20 she was demoted from RTC.) There are potential witnesses who have been
21 essentially bought off with forgiveness of purported debt known as “freeloader
22 debt. At least one witness is not in this suit because of threats made against his
23 family relationships. There are witnesses who reasonably believe they will be
24 declared suppressive persons and labeled “fair game” if they testify for Plaintiff.
25 Plaintiff contends that defendants should be forced to disclose the persons
26 involved in this activity, the identity of potential witnesses and claimants
27 contacted the identity of all who signed agreements or waivers of this nature, and
28 all of the documents and purported confidentiality agreements generated by this
9
PLAINTIFF’S OPPOSITION TO DEFENDANTS’ MOTION TO DISMISS
 1 inappropriate activity. Plaintiff may then move for relief and seek an order that
2 will assure witnesses that they cannot be penalized thousands of dollars for
3 serving as witnesses in this case.
4 T. MAGISTRATE JUDGES
5 The parties have not agreed on this issue.
6 October 9, 2009
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
10
PLAINTIFF’S OPPOSITION TO DEFENDANTS’ MOTION TO DISMISS