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Oakley, Inc., A Washington Corporation, and James Jannard, An v. Sean Mcwilliams

October 17, 2012

OAKLEY, INC., A WASHINGTON CORPORATION, AND JAMES JANNARD, AN INDIVIDUAL, PLAINTIFFS,
v.
SEAN MCWILLIAMS, AN INDIVIDUAL, DEFENDANT.



The opinion of the court was delivered by: Hon. Dean D. Pregerson

NO JS-6

FINDINGS OF FACT AND CONCLUSIONS OF LAW

Courtroom 3, 2nd Floor

1. Prior to 2006, Sean McWilliams ("McWilliams") was hired as a consultant for Oliver Peoples, a sunglass company. (Complaint ¶ 8) As a consultant, McWilliams provided Oliver Peoples with various product samples. In 2006, Oakley, Inc. ("Oakley") acquired Oliver Peoples. Soon after the acquisition of Oliver Peoples by Oakley, personnel from Oliver Peoples began receiving harassing emails from McWilliams, some of which alleged McWilliams had sexual relations with an employee of Oliver Peoples. McWilliams does not dispute that he sent these emails. (Answer ¶ 13)

2. For a short period time McWilliams ceased sending emails to Oliver Peoples and Oakley staff. However, in June 2007, a proposal was publicly announced for Oakley to be acquired by Luxottica Group S.p.A. ("Luxottica"), and McWilliams resumed sending harassing emails to Oakley, Oliver Peoples, Luxottica and innumerable other third parties defaming Oakley, Oliver Peoples, and James Jannard (the founder and majority owner of Oakley) ("Jannard"). (Complaint ¶¶ 16-23)

3. The emails contained harassing statements; pornographic images of McWilliams, which he claims were generated by Oakley and Jannard; statements attacking the character of Jannard and Oakley; and accusations that Jannard and Oakley were involved in price fixing, misleading investors, issuing death threats, and a cover up. (Answer, Exs. 53-61) Specifically, McWilliams accused Oakley of sponsoring charity fraud, being part of a price fixing cartel, and hiring "Blackwater" thugs to intimidate him. (Answer ¶¶ 14-16) McWilliams accused Jannard of being a "criminal" and of marital infidelity, as well as encouraging Oakley's alleged activities. (Answer Exs. 114, 125-127)

4. In his answer, "McWilliams admits documenting pornographic images in only a handful of emails with law enforcement agencies, including the DOJ. . . ." (Answer ¶ 22)

5. The emails were sent to Jannard's employees, associates, business partners, and industry personnel. (Jannard Decl., ¶¶ 8, 12, 23) McWilliams also states that he sent emails to "third parties, including the Justice Department, (FBI), State Dept., etc." (Answer ¶¶ 14, 22) Plaintiffs contend that McWilliams has used more than 22 email addresses presenting himself as Jannard, Oakley, Oliver Peoples or Luxottica. (Nelson Decl. Ex. 16) Several third party recipients requested McWilliams stop sending emails due to "clogged inboxes."

6. Both Jannard and Oakley claim that these emails have tarnished their reputation, caused serious embarrassment, and are not true. (Complaint ¶ 14) McWilliams "admits to sending emails [] to plaintiffs and third parties," but he "denies said emails contained untruthful allegations, harassing statements and otherwise discriminatory racist and hateful communications." (Answer ¶ 22) 7. On October 22, 2009, Plaintiffs filed the present suit against Defendant with claims for libel per se, fraud, publication of facts placing in false light and intentional infliction of emotional distress. (Dkt. No. 1) Defendant answered the complaint and filed his own counterclaims alleging intentional infliction of emotional distress on April 9, 2010. (Dkt. No. 23) After conducting discovery, Plaintiffs moved for summary judgment on their claim of libel per se and Defendant's counterclaim.

8. On September 16, 2011, this Court granted Plaintiffs' motions for summary judgment. The Court held that Defendant's emails constituted libel per se where the Defendant intentionally sent derogatory emails to third parties, declaring that Oakley and Jannard were guilty of criminal and immoral activity, which subsequently damaged the character and reputation of Plaintiffs. (Dkt. No. 87) The Court also granted Plaintiffs' motion for summary judgment on Defendant's counterclaim for intentional infliction of emotional distress and dismissed the Defendant's counterclaim with prejudice. (Id.)

9. Following the ruling on Plaintiffs' motion for summary judgment, Plaintiffs filed a motion for a permanent injunction on January 18, 2012, which was granted in part and denied in part on July 20, 2012.

10. Trial was scheduled to commence on Plaintiffs remaining causes of action on September 25, 2012. On September 24, 2012, the Court held a final pre-trial conference with the parties. At that time, Defendant appeared telephonically from China, where he resides. During the appearance, Defendant indicated that he would not appear for trial on the next day because he was unwilling to travel from China. (Dkt. No. 119) Accordingly, the Court ordered that default be entered against the Defendant and his answer stricken. (Id.)

11. Also during the pre-trial conference Plaintiffs indicated that they were willing to dismiss their second through fourth causes of action for fraud, publication of facts placing in false light and intentional infliction of emotional distress, respectively, and offering to present evidence to prove up damages on its first claim for libel per se. Accordingly, the Court commenced the trial on that day for purposes of proving up damages on its libel claim. (Dkt. No. 121)

12. The only remaining claim is Plaintiffs' first claim for libel, on which the Defendant has already been found liable. Where the Court has also previously issued a permanent injunction restraining certain acts by the Defendant, the only remaining issue is damages. The Court enters the following findings of fact and ...


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