18 June 2009

You Be the Judge

USCF's (Kronenberger) version: from Kronenberger Motion For Summary Judgment


5. Plaintiff is Susan Polgar ("Plaintiff' or "Polgar").

6. Defendants are United States of America Chess Federation, Inc. ("USCF"), Bill Goichberg, Individually and in his representative capacity as a member of the Executive Board of the USCF, Jim Berry, [Randy Bauer, Randall Hough, Bill Hall]; Brian Mottershead; Hal Bogner; Continental Chess Incorporated; Jerome Hanken; Brian Lafferty; Sam Sloan; Karl S. Kronenberger; and Kronenberger Burgoyne, LLP.

7. Third-Party Defendant is Paul Truong ("Truong").

A. Kronenberger was engaged by the USCF.

8. As this Court is likely aware, one of the Defendants, Sam Sloan, on October 2, 2007, filed a lawsuit styled Sam Sloan v. Hoainhan "Paul" Truong, et al., Cause No. 1:07-cv¬08537-DC, in the United States District Court, Southern District of New York. Sam Sloan sued many of the same parties that had been sued by Plaintiff in this lawsuit. Sam Sloan also sued Plaintiff in the New York lawsuit. See Exhibit B (Appendix, p. 59).3 The Sam Sloan New York lawsuit was filed before the USCF engaged Kronenberger.

9. In the Sam Sloan lawsuit, Sam Sloan alleged that Plaintiff, along with her husband, Truong, were engaging in vicious personal attacks against Sam Sloan, as detailed in the so-called "Mottershead Report."' Mr. Sloan alleged that Plaintiff and her husband began making thousands of internet postings that were defaming Sam Sloan. Sam Sloan claimed that Plaintiff and/or her husband were impersonating people and were making it appear that Sam Sloan had done all sorts of bad acts. Sam Sloan also alleged that as a result of the personal attacks, he was not re-elected as an Executive Board member for the USCF. Meanwhile, Plaintiff and her husband were elected as board members. When Sam Sloan sued the USCF and many of its board members and alleged that at least two of its board members (Plaintiff and her husband) had done such alleged bad acts, it put the USCF in a delicate situation as it was faced with the situation where a former board member was suing the USCF and at least two of its current board members. Importantly, there was a clear conflict of interest between Polgar and Truong, on the one hand, and the USCF, on the other hand.

10. Ultimately, the USCF's insurer obtained counsel to represent the USCF and several of the Defendants in the Sam Sloan New York lawsuit. Moreover, the USCF's insurer later engaged a separate counsel to represent Plaintiff and Truong. Although the New York lawsuit was eventually dismissed and appealed, Sam Sloan has stated his intention to continue to appeal the decisions made against him and/or pursue other litigation. Consequently, the USCF and many other Defendants appear to be caught between a much larger and ongoing conflict between Plaintiff and Truong and Sam Sloan.

11. In defending the Sam Sloan litigation, the USCF began investigating the claims contained in the Mottershead Report, being made in Sloan's complaint against two of the USCF's current board members, Plaintiff and her husband, Truong. To assist the USCF in its investigation, the USCF engaged a firm with an attorney familiar with the internet issues in dispute, Kronenberger. As seen by Exhibit A, Tab 1 (Appendix, p. 9), the USCF, not Plaintiff, engaged Kronenberger. Plaintiff knew that Kronenberger was engaged for several purposes, including representing the USCF in investigating the allegations in the Mottershead Report and in the Sam Sloan litigation.

B. Kronenberger begins investigating as requested by the USCF.

12. One of the first things that Kronenberger did once engaged was to recommend that the USCF form a separate legal subcommittee, which did not contain Polgar or Truong as members, as it was unclear at the time whether or not Plaintiff and/or Truong did the alleged acts; additionally, the legal subcommittee needed to confer confidentially because Polgar and Truong were potentially adverse to the USCF in the Sloan litigation. In investigating the allegations in Sam Sloan's lawsuit, Plaintiff's husband was specifically asked to deny having any involvement with the fake Sam Sloan postings, and Truong refused to so specifically deny the accusations in writing. More specifically, Kronenberger stated as follows in his letter dated November 29, 2007 to Truong:

• Formally admit or deny, in writing, whether you were involved in the "Fake Sam Sloan" postings, or had knowledge of who made such postings;

• Provide the IP address of all your home and work internet connections since 2005, or provide consent for the Board to obtain and cooperate in the Board obtaining, such IP addresses from ISP's and other entities;

• Provide all information that would support your argument that you were not located at your computer(s) at the time of alleged Fake Sam Sloan postings, to include information relating to your travel;

• Comply with the foregoing on or before December 7, 2007.

See Exhibit A, Tab 2 (Appendix, p. 15). Truong did not respond to the letter. Instead, Truong's wife, Polgar, began communicating with Kronenberger on behalf of her husband. Truong did not deny the claims in writing. Truong did not provide access to his computer. Truong did very little to try to demonstrate he was innocent.

13. Instead, Truong and Polgar continued making litigation threats against the other board members. The USCF began experiencing other new issues in having a former board member, Sloan, sue the USCF and two of its current board members, and then the two current board members began threatening the other board members, and meanwhile the USCF is still having to defend many specific allegations against two current board members, Plaintiff and Truong. Even more unfortunate, the threatened claims became actual litigation when Plaintiff filed this lawsuit. If they were truly innocent, one would have thought that Plaintiff and Truong would have cooperated and/or better cooperated in the investigation of the claims and in defense of the claims being made by Sam Sloan.

14. Meanwhile, after the legal subcommittee was formed to address such issues, highly sensitive attorney-client privileged emails that Kronenberger sent to the legal subcommittee members appeared in Plaintiffs possession. See Exhibit A, Tab 4 (Appendix, p. 37). In the privileged emails, Kronenberger was providing legal advice to the USCF about its legal position vis-à-vis Polgar and Truong in the context of the Sam Sloan litigation. Plaintiff obtained possession of attorney-client emails. Plaintiff then refused to state how she specifically obtained the emails. Plaintiff was not a recipient of the emails, and she refused to cooperate in an investigation trying to uncover how and why she received stolen emails. One would have also thought that Plaintiff and Truong would have cooperated with regard to investigation pertaining to the stolen emails. However, instead of cooperating with the continuing investigations, Plaintiff eventually filed this lawsuit against the various defendants. Again, the filing of this lawsuit has continued to put many of the Defendants in a delicate situation of being faced with conflicting claims of being sued both by Mr. Sloan, Mr. Parker, and Plaintiff in various different proceedings. Other than the USCF and Randy Hough (whose email account was hacked into), no other defendant has brought any claims against Plaintiff.

15. On August 7, 2008, Plaintiff sued Defendants for various claims.

Susan Polgar's version: from Susan Polgar's First Amended Complaint (16 March 2009)

37. After release of the Mottershead Report, the USCF and its Executive Board members, Defendants, Hall, Hough, Bauer, Goichberg and Berry, shopped the false and defamatory Mottershead Report to various internet fraud investigation firms who could help them build their case against Truong. The first firm presented with the Mottershead Report declined to help stating such a claim that Truong was the FSS would be impossible to prove. The second firm presented with the Mottershead Report stated that the Report contained discrepancies after preliminary review.

[Despite Susan Polgar’s multiple requests in writing, Defendants Goichberg and Hall repeatedly refused to allow Polgar and her experts the opportunity to examine the validity of the Mottershead Report and any supporting evidence.]

The third firm the USCF presented with the Mottershead Report were Defendants Karl Kronenberger and Kronenberger Burgoyne, who agreed to accept the case. When the USCF, and its full Executive Board, including Polgar and Truong, hired Karl Kronenberger and his firm, it was with the understanding that Kronenberger represented the entire USCF Executive Board, including Polgar and Truong, and that his function would be to help the USCF determine the real identity(ies) of the Fake Sam Sloan.

38. When Sloan sued the USCF in New York in October 2007, the USCF carried a policy of insurance with Chubb which paid for a defense of the New York lawsuit for the USCF and its Executive Board members, Polgar and Truong included. In or around November 2007, Defendant Kronenberger conspired with the USCF and Defendants Hall, Hough, Bauer, Goichberg and Berry to contact Chubb and persuade it (Chubb) to refuse to extend coverage to Polgar and Truong, which would force Polgar and Truong to defend the lawsuit with their own funds and create for them serious financial hardship. Defendant Kronenberger suggested this idea and the Board voted 5-0 to authorize defendant Kronenberger to contact Chubb insurance. The Board refused Polgar and Truong the opportunity to participate in the vote per the suggestion of Defendant Kronenberger.

39. In 2008, every Defendant named herein remained consumed and absorbed by the task of seeing Polgar and Truong removed from their Executive Board positions with the USCF. In June 2008, in conspiracy with Defendants USCF, Hall, Hough, Bauer, Goichberg and Berry, Defendants Kronenberger and Kronenberger Burgoyne unlawfully filed a “doe” lawsuit in California Superior Court. This lawsuit failed to identify any defendants by name and instead, sought an order from the court allowing Kronenberger and the USCF to conduct ex parte discovery which could lead to defendants they could name in the suit.

There are fundamental differences in these two versions. What questions would you ask to determine the truth? • See also Polgar's Original Complaint (6 August 2008) and (Warning! : Sam Sloan commentary) Polgar Raises the Stakes.

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