SUPERIOR COURT OF THE STATE OF CALIFORNIA

FOR THE COUNTY OF LOS ANGELES

DEPARTMENT NO. 57 HON. PAUL G. BRECKENRIDGE, JR., JUDGE

CHURCH OF SCIENTOLOGY OF CALIFORNIA, Plaintiff, vs. GERALD ARMSTRONG, Defendant. MARY SUE HUBBARD, Intervenor.

) ) ) ) ) ) ) )

No. C 420153

REPORTERS' DAILY TRANSCRIPT

Friday, June 8, 1984

Volume 28

Pages 4722 to 4901, incl.

APPEARANCES: (See Appearances Page)

NANCY L. HARRIS, CSR #644 HERB CANNON, CSR #1923 Official Reporters

APPEARANCES:

For the Plaintiff:	PETERSON & BRYNAN BY: JOHN G. PETERSON 8530 Wilshire Boulevard Suite 407 Beverly Hills, California 90211 (213) 659-9965 -and- ROBERT N. HARRIS The Oviatt Building 617 South Olive Street Suite 915 Los Angeles, California 90014 (213) 623-7511
For the Intervenor:	LITT & STORMER BY: BARRETT S. LITT Paramount Plaza 3550 Wilshire Boulevard Suite 1200 Los Angeles, California 90010 (213) 386-4303 -and- BARRETT S. LITT BY: MICHAEL S. MAGNUSON The Oviatt Building 617 South Olive Street Suite 1000 Los Angeles, California 90014 (213) 623-7511
For the Defendant:	CONTOS & BUNCH BY: MICHAEL J. FLYNN - and - JULIA DRAGOJEVIC 5855 Topanga Canyon Boulevard Suite 400 Woodland Hills, California 91367 (213) 716-9400

INDEX FOR VOLUME 28		Pages 4722 — 4901, incl.
DAY	DATE		PAGE
Friday	June 8, 1984	A.M.	4722
		P.M.	4816

PROCEEDINGS

OPENING ARGUMENT FOR PLAINTIFF
BY MR. LITT	4722
BY MR. HARRIS	4762
CLOSING ARGUMENT FOR DEFENSE
BY MR. FLYNN	4777
CLOSING ARGUMENT FOR PLAINTIFF
BY MR. HARRIS	4870
BY MR. LITT	4886

4722

LOS ANGELES, CALIFORNIA; FRIDAY, JUNE 8, 1984; 9:05 A.M.

oOo

THE COURT: Very well, in the case on trial let the record reflect that counsel are all present. Who is going to open here, Mr. Litt?

MR. LITT: I will, Your Honor.

THE COURT: Very well.

MR. LITT: May it please the court, this case began and still essentially remains a simple and straight-forward case. We are seeking damages and injunctive relief for Mr. Armstrong's breach of his fiduciary duty, conversion of documents, both originals and copies, invasion of Mrs. Hubbard's privacy and breach of confidence.

4723

The elements of each of these is straightforward.

With respect to the breach of fiduciary duty, all that is required is that an employee or an agent who has a duty not to use confidential, secret, or valuable information against the interest or to the prejudice of his employer or principal not do so.

With respect to conversion it is any act of dominion or control wrongfully exercised over another's personal property inconsistent with his or her rights to that property.

With respect to invasion of privacy, it is any intrusion into or dissemination of private information, obtained for a specific purpose may not be used for another unauthorized purpose or disclosed to a third party.

With respect to the breach of confidence, it is the use any confidential idea provided to a person in confidence when it is known that the information is to be kept confidential and may not be disclosed to third persons.

In our trial brief at pages 25 through 31 the cases with respect to that are summarized. And there is a section following in the trial brief that discusses the case law at greater length. I don't think I need spend time on case citations in this argument.

With respect to injunctive relief, all that is required is that there be personal or property rights which have been violated and that legal remedy is not adequate to protect those rights. And injunctive relief reaches prohibition of the dissemination of private documents or

4724

other information obtained in violation of one's privacy or any confidential or fiduciary relationship. And there are also cases cited to the Court on that.

The basic fact [facts] with respect to all of these causes of action remain undisputed in this record.

4725

Mr. Armstrong was a church staff member. I will return to that subject, but I think the record is quite clear that he was a church staff member. He petitioned Mr. Hubbard for approval to be posted in a church staff position.

The petition was approved.

The task involved collecting and preserving materials for archives relating to Mr. Hubbard and his life. These documents were collected from various church properties, including the Hubbards' private storage at Gilman Hot Springs, personal secretary's files throughout the world at various churches, and later from the controller archives which had been maintained under Mrs. Hubbard's direct supervision.

Mr. Armstrong after being appointed had an office set up at the church's complex at Cedars here in Los Angeles. The documents that he collected are, by his own description, private and confidential documents. They are by his own description documents of great value. The court has an exhibit a document in Mr. Armstrong's handwriting where he discusses the fact that these are of great monetary value. He estimates them -- this is as early as February or March of 1980 -- at a value of $2 million in that document. He talks about them, not only in terms of their economic value, but their value to the church and in that document be talks about how until proper security precautions are taken to set up the archives, he will sleep with the documents in order

4726

to insure that they are protected.

It is also established from Mr. Armstrong's own testimony that the operating procedure was that originals were to be preserved and not used and a copy was to be made of any originals. The originals were to be put away in a file and not used and originals were not to go out.

Between February and October of 1980 Mr. Armstrong collected these materials. In the area in which he worked there was extremely limited access. There were keys that only a small number of people had. The archives relating to Mr. Hubbard were kept locked in separate locked cabinets as an added security precaution.

During this time Mr. Hubbard, who has at most approved this one-page petition, is gone and presumably has no knowledge, certainly no indication of any knowledge of what Mr. Armstrong is doing.

Similarly, Mrs. Hubbard has testified that her understanding was that Mr. Armstrong was collecting materials of historical interest and for a museum. The record establishes that with respect to the controller archives, which had been maintained under her, that a distinction was made between archives and personal materials, and that any personal materials which were to go out to Mr. Armstrong's archives, were to first be reviewed by her which happened on one occasion and she did review them and they were personally sent to her, not only for her to get a description of them in writing, but actually to see precisely what it was was being sent to Mr. Armstrong.

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The point of all this simply being that Mrs. Hubbard's own understanding was not that Mr. Armstrong was, in fact, collecting much of the material that he was, but Mrs. Hubbard also testified that it was recognized that while within the church Mr. Armstrong was acting and obviously had some kind of authority to do this, so that the fundamental issue, of course, is not what Mr. Armstrong did while he was collecting these things within the archives. The fundamental question remains what he did after he left the archives, but I do know with respect to Mrs. Hubbard's own knowledge that Laurel Sullivan testified that in the summer of 1982, that she had a letter from Mrs. Hubbard regarding this question of Mr. Armstrong and what she said that she didn't know why Mr. Armstrong would have any letter of hers.

So, from February to October 1980 Mr. Armstrong is gathering up these materials. Around this time begins the formalization of the contract with Mr. Garrison. Mr. Armstrong met with Mr. Garrison shortly before that contract was signed. It was in a meeting in England arranged by David Gaiman who was a church staff member at that time.

The contract itself was signed shortly thereafter. The contract had a specific clause that there would be no invasion of privacy in anything that was written. It was quite clear from Mr. Garrison's testimony as well as from the contract itself that anything that was written and done was subject to the approval and review of at least Mr. Hubbard, and according to Mr. Armstrong and Mrs. Hubbard,

4728

Mrs. Hubbard was also to review it. There was a clause saying that if the contents of this were not satisfactory, that the book would not be published and a financial arrangement would be made with Mr. Garrison.

Thus, the contract itself had ample protection to insure the privacy of anything that was done with respect to this biography. Mr. Armstrong was appointed immediately after this contract was signed as a researcher to assist Mr. Garrison. This was done by the procedure of AOSH DK which has also been referred to as PUBS DK requesting that a researcher as well as office for Mr. Garrison be provided.

This request was made to the Church of Scientology of California. The request was approved. Mr. Armstrong was authorized to assist Mr. Garrison as researcher on behalf of the Church of Scientology of California.

Mr. Armstrong, in the process of gathering up the materials, consistently assured people that the privacy and confidentiality of this material would be protected.

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Mr. Vorm testified concerning his discussions. The Court will recall after Mrs. Hubbard resigned her position, there was a request from Mr. Vorm and Mr. Armstrong that materials -- actually, the request initiated from Mr. Armstrong that he get certain materials.

Mr. Vorm was reluctant to give him certain materials because he felt they were particularly personal and private.

Mr. Armstrong assured him that there need be no concern on this score; that the privacy of these materials would be protected.

There is an exhibit in the record in which there is a discussion by Mr. Armstrong concerning photographs that he is trying to get. And in that document there appears to have been some concern about providing him the photographs or providing to Mr. Garrison.

In the document he says, "You needn't worry about giving anything to Mr. Garrison because LRH has approval of the biography."

So that anything that goes to Garrison remains private.

Mr. Armstrong, in everything that he did while he was on his archives post, acted and represented to other people that the privacy of these materials would be guaranteed and protected.

Mr. Armstrong, in his own testimony as well as Mr. Garrison established that the material that was provided to Mr. Garrison was provided solely for use in the biography.

4730

Mr. Armstrong stated that he gathered material for only two reasons, for the archives and to give to Mr. Garrison solely for use on the biography; no other purpose.

It was understood that Mr. Garrison himself felt that the only use that he had of these materials was in connection to the biography that he had contracted for.

Both Mr. Armstrong and Mr. Garrison stated that the materials were confidential; that they were private; that they were personal and that they were treated as such by Mr. Garrison.

Mr. Armstrong stated that he did not believe that any access that he had been granted in connection with these materials included any authority to give them to Mr. Flynn or to use them as he later did and that he certainly didn't think that the Hubbards would have given him such authority.

After Mr. Armstrong left his post he eventually developed -- which I'll discuss further a little later in this argument -- what resulted in him sending massive amounts of these private materials to Mr. Flynn and using them improperly. Thus, the basic facts show -- and all of the facts that I have stated remain unchallenged in this record without exception except for the issue of who Mr. Armstrong worked for.

But Mr. Armstrong's own motivations and reason for doing what he has done have been placed in issue.

So before going to what happened when he left and the circumstances leading to his using these materials

4731

in this improper fashion, I want to review the background once again in light of Mr. Armstrong's own motivations.

The first clear indication that the Court can get of what Mr. Armstrong's real motivations were, I think, came when he began his own testimony and began to describe his experiences in the Church going back to the very beginning.

What comes through in that testimony is that to this day Mr. Armstrong is unable to confront the actual fact of what his experience in the Church was. He is unable to confront how he felt about those things at the time because he is bitter. And I'll return to this more.

But in terms of just his own description of having been in the Church, he refused to acknowledge that he had any religious commitment; in essence, he denied that he ever knew that Scientology was a religion; yet, he read the books of the religion that taught about it being a religion.

Why does he do that? He does it because he is pushing away the 13 years that he devoted to Scientology; because he is trying to find a way to trample on those 13 years.

He describes his experiences on the ship. His description is that it was this horrible experience where he was in constant fear. Yet, it is obvious that he was an enthusiastic person at the time who voluntarily worked long hours; in fact, even longer hours than most other people.

Homer Schomer said he had worked 80 to 100 hours

4732

a week; Mr. Armstrong worked 100 to 120 hours a week.

At the time he was devoted to Scientology; he wanted to be a good Scientologist. He liked what he was doing. He wanted to do what he was doing. But today it is different.

He claims that he lied constantly when he was in Scientology from day one. He went from lie to lie.

He said there was no reason that anybody on the ship should legitimately have been concerned about trying to keep confidential the fact that the ship was connected to Scientology.

On the other hand, as late as October, 1981 he said in a letter to Gale, the letter talking about his wife coming to work in his post, that he had never done anything illegal in all of his years in Scientology; that he had always made sure that everything he did was scrupulously legal; yet, according to him now, everything he did was illegal.

Even his own witnesses such as Kima Douglas explained why Scientology could not publicly announce itself; explained her own experience of having been falsely arrested with the involvement of the CIA and questioned about Scientology.

4733

He now calls the RPF a prison, although at the time he was enthusiastic about it. Indeed, he was one of the people who engendered enthusiasm in other members of the RPF. His reaction to his "success story" was that he simply -- he could not deal with the fact that at one time that is how he felt.

However he feels now, that is how he felt then. He cannot admit that, and this inability to be able to come to terms with his own experience and with his own feeling is at the root of what has gone on with Mr. Armstrong from the time before he left the church because what is at the root of it is a mind that has become increasingly vindictive and embittered.

Now, a similar process of denial exists with respect to whether he worked for the church or not, except here it has a little different twist because it is to try to put him in a position in this court to make a legal argument.

He claims that he always worked for L. Ron Hubbard. He was always an employee of L. Ron Hubbard. Yet the evidence is so overwhelming that he was a church employee who at certain times handled matters relating personally to L. Ron Hubbard as a church employee, that it really cannot be questioned.

There are pay vouchers from the church. There is the fact that property that he worked on was owned by the church. All of the purchases that Mr. Armstrong made were made with church money. All of the payments for his

4734

trips to go and talk to people were paid with church money. The Xerox machine with which he copied all of these materials that he took from the church was paid for with church money.

In May of 1980 he claims, and so does Laurel Sullivan, that they were employees of L. Ron Hubbard, not only Mr. Armstrong but Miss Sullivan. Yet, there is a letter from May of 1980 requesting that the church give a letter of employment as a church employee to Laurel Sullivan, written by Mr. Armstrong. That is in evidence.

All of his documents show church routings, and if that were not enough, there is the June 15, 1981 exchange between Miss Sullivan and Mr. Armstrong in which Mr. Armstrong makes an inquiry to Miss Sullivan and she responds, "You are a Church of Scientology of California employee."

Mr. Armstrong didn't have much to say about that letter, and the facts are clear that he worked for the church.

He had always worked for the church. He was a Scientologist on a Scientology post. On December 10 when there was a corporate change and portions of the Church of Scientology of California were transferred to the Church of Scientology International, Mr. Armstrong received a letter saying that he was being moved from the Church of Scientology of California to the Church of Scientology International. That would be his new employer. He was given a chart which showed the new corporate organization. That chart had on it that formerly the personal office

4735

whose name had been changed to the PDOI, Product Development Office International, was under Church of Scientology of California.

The household unit for which he had worked previously had been part of the Church of Scientology of California, and these units were now being moved to the Church of Scientology International.

The documents in this case show that the personal office of L. Ron Hubbard was a dba of the Church of Scientology of California and that there was a formally registered document to that effect, and finally Mr. Armstrong's own resignation makes no mention of leaving Mr. Hubbard's employ. He is resigning his post.

Now, I don't there is much question that the record shows that Mr. Armstrong was a church employee, but it also shows that Mr. Armstrong, there is a pattern which emerges, and it is a pattern of distorting and lying about what, in fact, happened; what, in fact, he did; how he felt; who he was and what he was doing.

This process of distortion begins to get at the more complex story of what has happened in this case, not only more complex, but more treacherous because essentially this case is the story of a person, in the words of Frank Flinn, who becomes an apostate, whose love for his religion turns into hate, whose efforts to build and create that religion turn into an impulse for destruction, and whose former defense of that religion turns into an attack, and this is necessitated by his own need to fill

4736

a void in his life.

Mr. Armstrong had spent 12 years, 13 years working unceasingly in Scientology, and loses his faith in Scientology.

4737

And he felt he needed to attack that thing because he could not cope with his own life in any other way. And this process, in fact, begins well before Mr. Armstrong left the Church.

I'll not be discussing -- Mr. Harris will -- the affirmative defense as such. But I will discuss the fact that the evidence shows that Mr. Armstrong went through a process of transformation in which his impulse to attack developed in three stages.

The first stage of that begins well before he ever left the Church. He testified -- and this phase is characterized by this drive to get these documents to Mr. Garrison. He testified that he and Mr. Garrison had discussions about purported discrepancies which, I might add, Mr. Armstrong did not do much to research; had over 100 conversations in the course of a year. And as early as Mr. Armstrong's trip to the Midwest in which he stops and sees Mr. Garrison -- this is July and August of 1981 -- they discuss the fact that they don't think this information will ever come out.

Mr. Armstrong says he doesn't think the biography will ever see the light of print.

In fact, Mr. Garrison concludes likely after this trip in July or August of 1981 that Mr. Armstrong is inevitably going to leave the Church.

The Court will recall he testified with respect to this Ralston-Pilot thing; that he hadn't discussed it with Mr. Armstrong, but that he had concluded that Armstrong

4738

will leave.

And the only contact in that period that existed in the record is this trip. So that as early as July or August, it is clear to Mr. Garrison that Mr. Armstrong is going to leave. And it appears to be the view that this biography will never see the light of day.

Yet, Mr. Armstrong works on, not researching, but gathering up materials.

Shortly thereafter in October he gets his wife on his post to help him copy more materials. And in two months, from the end of -- from October to December he copies as many documents for Omar Garrison as he had copied in the previous year, an additional 50,000 documents roughly. Because the testimony was that there had been approximately 100,000 given to Mr. Garrison. And Mr. Armstrong said that one-half of those had been given in that last two months' period.

Now, the record shows that shortly after this Mr. Garrison broke off his writing the biography under the contract and was using these materials to write this biography on his own. And it is a fair inference from the record that Mr. Armstrong was aware of this possibility while he was making sure that all of this material got to Mr. Garrison.

Not only is this occurring, at the same time Mr. Armstrong makes sure that he gets the Controller Archives. And he makes sure that he gathers everything up to get it to Mr. Garrison.

4739

There is a process beginning of whether or not this biography contract with Mr. Garrison should be renegotiated. Mr. Young was assigned to this renegotiation process internally. Yet, Mr. -- and he is talking to Mr. Armstrong about it. He doesn't know that Mr. Armstrong is passing information to Mr. Garrison with respect to the internal discussions as to how to renegotiate this contract.

Mr. Young testified that he had conversations with Mr. Armstrong concerning points that Mr. Armstrong was raising and whether they had been adequately researched or not. But Mr. Armstrong wasn't interested in research because by this time Mr. Armstrong was set on his own view. He was set on getting this material out. He was no longer carrying out in good faith his duties as an archivist.

And it is also in October that Mr. Garrison, in fact, makes him a director of Ralston-Pilot.

As October slides into November, Mr. Armstrong is sending internal memoranda; he sent it and it is in evidence and it came from Mr. Garrison's files; sent to him by Mr. Armstrong at the time.

He sent what is called a CSW of Mr. Young, a multi-page document which talks about his objective as to what he is supposed to do on the biography debug in which he discusses a whole range of things.

This document is secretly provided to Mr. Garrison while Mr. Armstrong is on his post. This conduct is deceitful. That was a breach of fiduciary duty by itself. Of course, that is not in issue in this case.

4740

Its significance is that in October at the latest, at the latest, Mr. Armstrong is not acting to carry out his archives post. He is acting to get this information to Omar Garrison because he thinks that is the vehicle to get it out and attack Scientology.

4741

That is in his mind. Whether his view of that material is right or not, that is what be wanted well before he left.

He is writing letters, and some of them are in evidence, in which he nitpicks on every issue. Whether or not a Boy Scout medal was at the age of 12 or 13. The court has the letters, and you get this feeling of somebody trying to find everything to stick a pin into.

Now, Mr. Armstrong has said that he didn't decide to leave until this incident with Mr. Starky occurred. The incident with Mr. Starky had to do with a discussion between Mr. Starky and Mr. Armstrong, after which Mr. Starky concluded that Mr. Armstrong had antagonisms and so he requested that there be a security check, undisclosed antagonists. I would suggest that the record certainly shows that that perception on Mr. Starky's part was accurate.

But this security check has been made a major issue in the case, and it has been made a major issue because Mr. Armstrong has tried to portray what has gone on, not as a process of increasing attack by him, but as purportedly responsive to attacks on him. So, let us take the security check.

The date, according to Mr. Armstrong's own documents, the incident, the conversation occurs on November 24. This is a conversation with Mr. Starky. There is a security check requested and he goes to see this Cope Officer Cirrus. That is when he learns about the security check, November 24th, that it had been requested. Mr. Armstrong

4742

testified, "That is when I decided to leave."

There is only one problem. It is a blatant lie. How do we know it is a lie? Laurel Sullivan, and it appears that former Scientologists have quite a good memory for certain dates, testified she left Scientology on November 21st. The day she left she had a conversation with Gerald Armstrong and Joyce Armstrong and said, "Are you guys going to leave, too?"

And on November 21st, before this incident, Mr. Armstrong says, "Yes, buy [but] I have got to get the documents to Garrison first"; before the security check incident.

Furthermore, Joyce Armstrong testified that at some point she and her husband had discussed leaving and decided to leave and obviously those discussions and that decision was reached before the November 21st discussion with Laurel Sullivan. So that the record is quite clear, not from our witnesses, from Mr. Armstrong's witnesses and from Mr. Armstrong's documents and from Mr. Armstrong's description.

He did not decide to leave because of anything having to do with any security check or anything done to him. He had decided to leave well before that, and he was staying for one reason and one reason only, to make sure that before he left he got everything he wanted to have Garrison have his hands on out of the church and into Garrison's hands.

At this period in time he's already made some arrangements with Mr. Garrison concerning making sure

4743

that he is all right and if Garrison doesn't hear from him he is to do something or whatever it is. Garrison -- sorry, Mr. Armstrong had told Mr. Garrison that he would get whatever he could to him and stay as long as he could, and during all of this period he is copying as such of this as he can. He is getting this material out. He is sending whole binders.

By December he is making -- he and his wife are copying, binding, putting things together, getting them out to Mr. Garrison, removing things from their apartment, all as part of the process of leaving, but first making sure that Mr. Armstrong gets it to Mr. Garrison.

Mr. Armstrong contended that he -- he concluded that no accurate biography of Mr. Hubbard could be done.

I am not going to discuss his own views of what is accurate or not, but there is in evidence exhibit 68 which is a document that the court can take a look at for itself, which is the main biography according to Mr. Young's testimony, that was written in this period for public dissemination. It was sent down to the archives area for review and the court can take a look at it for itself as to whether or not even under Mr. Armstrong's claims, any such thing is true.

It is one more post hoc contention to justify his own conduct. In that same period Mr. Armstrong talks about this one document which is, I think, exhibit 112 where it is okay to lie about Mr. Hubbard. Then he says in testimony well he had to say that to people.

4744

Well, you have one or two conclusions. Either he was lying to them and why was he lying to them? So that he wouldn't get removed from post, so that he could keep copying the documents to make sure that Omar Garrison got them so that they could be used to attack Scientology or he is endorsing the lie and he is lying now.

4745

In the same time period right before he leaves staff, he gets money, $2,500, which was in some dispute to Mr. Garrison. And when he leaves, finally concluding that he has got to get out, he has thousands of originals that he hasn't been able to copy.

And what does he do with them?

He takes the originals.

Now, why does he take the originals?

The policy is clear; he had never taken originals to Mr. Garrison before.

Mr. Young was on post. And when Mr. Armstrong left he wrote a note saying, "Please, make sure that Mr. Young helps out Mr. Garrison."

Why did he do that? Because he was driven at that point to get everything out. That was the first step, get it out of the Church where he can get his hands on it or have his hands in it because he believes it is an attack point. And he is attacking at this point. He is not defending anything. Nothing has been done to him. He is in the process of attacking.

And the form that that takes, he steals these originals of great value, by his own admission, because since he didn't have time to copy them, he was going to make sure that nonetheless they were out.

As soon as he left the Church he goes to Mr. Garrison. That is the first phase of what happened with Mr. Armstrong. And that phase shows a pattern which develops in this record. And it is a pattern which shows that it is

4746

in fact Mr. Armstrong who is compelled and driven to attack Scientology and L. Ron Hubbard because if you want to attack Scientology, you attack L. Ron Hubbard because he founded Scientology and he is the source of all of its doctrine.

As soon as he leaves he goes to work for Mr. Garrison, keeping his hands on these documents.

Mrs. Armstrong testified that when he left, the day he left, Mr. Armstrong was an emotional cripple. He couldn't get away from Scientology. It was on his mind. He was constantly thinking about it.

And what was he thinking about? He was thinking about his hostility and his hatred for what he now felt were wasted years. He resented every day now that he had spent and he was going to get back; whether he even understood it, that is what was going on in this man's mind. And he claims that he was afraid. He left in the way that he did because he was afraid. Yet, constantly he is drawn back to the Church. He talks to people on the phone; he sets up meetings a block away, two blocks away, three blocks away; pre-arranged meetings with all kinds of Church people.

The evidence shows that in January he met at the Grinder Restaurant with Barbara DeCelle, Vaughn Young, and Mrs. Armstrong; that the Grinder Restaurant is located very close to the Cedars Complex; that this had been set up by telephone with Barbara DeCelle and in this meeting he is showing his attitude.

He is highly critical of Scientology and Mr. Hubbard; he is saying that people should leave; he is

4747

saying that Scientology doesn't do anything decent; in fact, he said the only thing decent that he did -- I believe this is the testimony -- was work on the biography. That is his view.

Nothing is done to him; nor is he afraid.

He meets with Mrs. Gamboa shortly thereafter also at the Grinder Restaurant.

He meets with Marilyn Brewer, Ed Brewer, all kinds of people.

In fact, a little later in February he goes into the archives and he, among other things, walks over and picks up all of his personal things that were in the archives and walks out.

The question in cross-examination: "Did anybody try to stop you?"

After all, one of the reasons that he left the way he did was that he wouldn't be allowed to take his private papers.

"Did anybody stop you?

"No."

At this meeting Mr. Young specifically had been looking for this private letter of Mrs. Hubbard.

He asked Mr. Armstrong, "We can't find this letter. Where is it?"

Mr. Armstrong says, "Oh, I don't know. I don't have it."

Why? Because he is holding on to these materials. He cannot let them go because they are -- it is building in

4748

him to use them as a form of attack.

Mr. Young testified that not too much later there was a meeting at Mr. Garrison's house; obscene comments were being made; obviously hostile and antagonistic comments.

The record shows that Mr. Armstrong in the period after he left the Church is possessed by his hostility toward Scientology from the day that he left; that he was covering up what he had done within the archives; that no one knew that he had all of these originals and that he lied about it when asked because he knew that you could not take originals. And that, indeed, this urge, this uncontrollable urge on his part to attack Scientology continues to build in him. But it has nothing to do with being afraid of anything.

He met with Virgil Wilhite a number of times who he testified was known to be a Scientologist and was known to have contacts with Scientologists.

He met other times with Marilyn Brewer.

By April, according to Mrs. Dincalci's testimony, he has shown the document to people before the incident with the photographs.

4749

Now, I want to discuss Mrs. Dincalci's testimony for a moment. The court will recall I asked her on cross-examination whether any of the documents had been shown to her and she said yes. And I asked her what, and it was clear from her description that it included the affirmations and "Excalibur" and probably the document that is labeled here "Blood Rituals."

And I asked her, "Well, was this before any of these events with the photographs?" And she said, "Yes." That was her testimony originally.

Of course, she came back in after the break and after having her memory refreshed by Mr. Armstrong and Mr. Flynn, and thought that it was now after the photo incident. I think, as between the two versions, there is not much question about which is the credible version, and so the record establishes that by April he is beginning to show these documents to people and it is building in him to use these documents.

Mrs. Armstrong testified that she thought that she had shown them to her brother. So, well before any of the events that Mr. Armstrong says are the reasons for what happened, Mr. Armstrong has become a walking time bomb and the only question is when is he going to use these documents. There is not a question of whether. He has been set on this course since the fall of 1981.

April 15th or 20th, somewhere in there, according to Mr. Armstrong, he learns of the first declare. He goes to the church. Now, he says the declare, fair game. But

4750

he goes to the church and he picks up the Declare.

That is according to Mr. Armstrong's testimony. This Declare says basically that Mr. Armstrong failed to route out properly and that he had been spreading destructive rumors about senior Scientologists. That is what is in the Declare. The Declare is in evidence.

Then we come to the photo incident. Mr. Armstrong says not only his own photos which were given to him and which were given to him for him to be able to give to others, but he says the Dincalci's and the Douglas' photos which both they and he know were photos taken purely for private use and no other purpose, unlike Mr. Armstrong's photos which had been given to him with an agreement that they could be given to others.

I don't want to go into detail on what happens with the photos, but what is significant about this incident is that Mr. Armstrong, as soon as he heard that something has happened, immediately rushes right out in a frenzy to see Mr. Wilhite, to demand his photos back.

Now, when the incident was described originally to the court, I would suggest that the way this was presented was the fact that these photographs had been returned to him was buried at best because this was portrayed of having been his -- his photos having been taken.

But, of course, his photos were not taken. He says Mr. Wilhite is very upset. He is yelling and screaming. He runs from this to the CMO building at the Cedars Complex. Doesn't sound like someone in great

4751

fear. Fear is the last thing on his mind. He is totally attacking. He is screaming. He is yelling. He is swearing. He is saying everything he can think of about L. Ron Hubbard and Scientology.

Mr. Garrison describes him as maniacal. He is disrupting things that are going on there. He is obviously, Mr. Garrison also said that he was violently disturbed or words to that effect. I don't remember the exact language.

Now, this all is his instantaneous reaction to a dispute over photos, not even including his because his were given back, certainly showing that some distinctions were being made here.

4752

Nonetheless, he is Fair Game, according to him. But that is not what is going on. What is going on is that the inevitability of Mr. Armstrong attacking is simply playing itself out in his response to this incident.

Mrs. Gamboa comes in after Mr. Armstrong has, obviously been impossible to deal with and tells him to leave.

He, again, demands the photos back. And she says to him in response to that question, according to Mr. Armstrong's own testimony, get an attorney, obviously meaning we are not going to deal with you personally with respect to these photos.

Now, I note that there is no evidence in the record and there is no evidence in the record because there couldn't be any evidence in the record that any attorney ever made a demand for these photos.

It is a funny thing about how important these photos were and how significant it was and there was never a demand for the photos.

Where is that in the record?

Now, Mr. Armstrong said that he knew at this instant that he would be sued, sued, mind you; specifically, he knew that he would be sued under Fair Game as a result of the declare an [and] the photo incident. But he didn't know anybody who had been declared and sued in the last three years; nonetheless, he knew it. He was certain. And he immediately -- and these are his words -- he decided to take a stand and make a public statement.

4753

Now, what does that mean? He mentioned this several times.

What it means is that the logic of everything that he has been doing since the summer and fall of 1981 is playing itself out and he is going to take these documents and use them against the Church and use them against the Hubbards and use them to attack.

And what does he do?

He takes them to Michael Flynn.

Now, before I get to that, let me discuss that incident further.

There was one factual question that needs to be cleared up in the record.

Mr. Armstrong testified that Virgil Wilhite told him that -- mentioned the declare and that he thought that this was a reference to the first declare which he had already had and knew about.

Once again, as is the case with Mrs. Dincalci, after hearing that testimony and realizing that it creates evidentiary problems, Mrs. Armstrong comes in and says she thinks -- well, she thinks he mentioned the second declare.

But the evidence is clear not only from Mr. Armstrong's testimony now, but his declaration of September 16, 1982 occurring three or four months after all of these events were discussed in the record. And that is the sequence.

Mr. Armstrong knew of nothing, nothing except this first declare at the time that any of these events that

4754

we are talking about occurred.

In any event, he decides to go to Michael Flynn. He makes contact with him in the next few days.

Mr. Flynn pays his way to Clearwater. And in Clearwater he shows Michael Flynn the very private -- his words -- letter of Mrs. Hubbard.

Now, there is under seal in this case language from this letter that purports to show what of public interest was in the letter. I am not going to comment on it. But the Court has it available to him. And it is quite obvious that there was nothing in this letter of any public interest.

4755

It was an extremely private letter, and it was shown as an act of hostility and an attack, and to show Mr. Flynn what he had, the dirt that he had.

Now, Mr. Flynn is not just any attorney, and that is an important fact. Mr. Flynn is involved in litigation and is known to be involved in litigation with the church, with Mary Sue Hubbard, with L. Ron Hubbard. Going to Michael Flynn is not going to a detached attorney to discuss your remedies, rights or whatever.

Mr. Flynn, under Mrs. Hubbard's testimony, and it is not in any way controverted in the record, has numerous suits against her and her husband as well as the church, multimillion dollar claims in all of these suits. The significance of that, of course, has to do with what the purpose and reality was of sending these documents to Mr. Flynn.

Right after he sees Mr. Flynn, within the next two weeks, 20/20, he has contact with 20/20. He doesn't remember the details. Notice he claims that at this point he is in great fear, I guess.

The court should note because it is buried in the record that on May 15th, three weeks after the photo incident, Mr. Armstrong calls Andre Clavel, a church staff member. Makes prearrangements, meets him at a restaurant near the church, three or four blocks away, to return some slides. He returns the slides because it is known that he has these slides, and it is part of the coverup of what he is really doing, but he is not in fear.

4756

When he wants to have contact with someone from the church, he is perfectly willing to do it. This is a story. Each of these sequences of events is a story for the court.

The Bonaventure Meeting. The Bonaventure meeting, the dates were obscured in Mr. Armstrong's testimony for good reason because he didn't know about the second Declare when the Bonaventure meeting happened. What happened at the Bonaventure meeting? It occurs May 26th and May 27. He brings Mr. Flynn four or five binders and leaves them with him.

Mr. Flynn has the documents at the meeting. Kima Douglas has testified that Mr. Flynn said to people at the meeting, "Here are documents. Read them. These are documents from the archives. These are private documents."

These are documents that were not, I assume, that this was not shown to the Douglases and the Dincalcis for Mr. Armstrong's defense. They were shown to the Douglases and the Dincalcis because the purpose of giving the documents to Mr. Flynn was to use them, to use them to attack with.

So that now at this meeting, at the latest, and probably earlier, an arrangement is made between Mr. Flynn and Mr. Armstrong that he will send him these materials. By the way, what materials are they at the Bonaventure Hotel. The affirmations, private correspondence with his first wife, Naval records, and according to Kima Douglas, she believes the letter of Mary Sue Hubbard. An agreement is made in which these materials will be sent to Mr. Flynn.

4757

Now, immediately after this meeting, the day after, according to Mr. Armstrong's September 16, 1982 declaration; conveniently Mr. Armstrong's remarkable memory for dates stated, when he was on the witness stand, but it seems to have existed still back in September 1982, and those dates show that right after the Bonaventure meeting on the 29th of August Mr. Armstrong went to Utah. He went to Utah and he made an arrangement with Mr. Garrison that he will send documents to Mr. Flynn for his supposed defense. That is the story that he gave to Mr. Garrison as a way to get Mr. Garrison to agree.

4758

And on -- I'm sorry. I said 'August." I mean "May."

And on May 31st after he returns from Utah, after he has made these arrangements, he has a telephone call from Marilyn Brewer -- this is according to his September 16, 1982 declaration -- he has a telephone call from Marilyn Brewer in which she tells him of the second declare. And then and only then does he learn of it.

In the next period of time he sends thousands of documents to Mr. Flynn.

He gets a demand letter from Mr. Peterson, which is in the record. That occurs also, according to his September 16, 1982 declaration, on May 31st. And what does he do? He lies. He says, "I don't have any documents." While he is sending them to Michael Flynn.

Now, the Court heard Mr. Flynn walk up with each one of these documents. And he presented it to Mr. Armstrong and he said, "Did you send those to me for your defense?"

And Mr. Armstrong, in a litany, said, "Yes," that that is what he did.

"Request to admit:

"Between June, 1982 and August, 1982 inclusive Gerald Armstrong knowingly allowed Michael J. Flynn to utilize some of the original materials and copies of original materials which he had sent to Michael J. Flynn during the same time period in litigation other than the instant suit.

4759

"Admitted."

That tells the real story. These documents were sent to Michael Flynn, not for some suit, because the only suit that has ever occurred or would have occurred was for taking them and sending them to Mr. Flynn.

No. They are sent to Michael Flynn for him to use, to use against the Church, to use against L. Ron Hubbard, to use against Mary Sue Hubbard as part of an attack that has millions of dollars at stack [stake]. And Mr. Armstrong fits right into it because his hostility is so deep that anything that attacks Scientology, he is for at this point. That was the motivation for sending these documents. That is what this whole case is really about.

They were sent to Michael Flynn so that they could be exposed and used. In fact, Kima Douglas even testified that at the Bonaventure meeting there was discussion about having a public meeting to talk about these documents. And what is it that he has sent?

He has sent whole binders; he sent everything he had between Mary Sue Hubbard and L. Ron Hubbard. The only reason that there aren't a lot of Mrs. Hubbard's letters is because he didn't happen to have those because if the Court will recall, they had a second set of letters. And Mr. Garrison didn't think that those were that important.

He sent their private marital agreement written over 30 years ago between Mr. and Mrs. Hubbard; he sent whole binders of letters between Mr. Hubbard and his first wife; the whole binder of letters between Mr. Hubbard and

4760

his second wife; letters to attorneys; binders of letters between Mr. Hubbard and his parents including letters to Mary Sue Hubbard from Mr. Hubbard's parents; all of the internal Church documents that he could find; financial matters, private matters, eulogies; he sent all of the private papers that he could of Mr. Hubbard. He sent the affirmations; he sent every private diary and journal that he could get his hands on. He sent business correspondence, wills, letters from children, receipts, notes, the list is endless. These, for what, to what end? To attack Scientology; to bring these documents out because nothing else mattered to Mr. Armstrong at that point.

There is no question of a suit. There is no question of his responding to what was done to him.

The question is a pattern that has its roots back in his loss of faith in Scientology.

Now, Mr. Armstrong, in the last part of his testimony after Mr. Harris had called him, claimed that he bore no ill will toward L. Ron Hubbard or Scientology.

I would suggest to the Court that he does this in the same way that Diego in Othello talks about pretending affection for Othello which is to hold out a sign of affection for love. Because he can't come into this Court and tell this Court that he bears any ill will toward L. Ron Hubbard because he has to paint himself as the victim.

But what this case is about is not the victimization of Gerald Armstrong. What this case is about is a man who lost his faith, who turned more and more bitter

4761

and hostile and who was wrapped up in the vines of hatred and embitterness which we only get a glimpse of in this proceeding, but which is clear that he is out to destroy what he had once created and what he had once revered and to fill the void in his own life by destroying his previous life. He has to wipe out that which he had most loved because he could not go on until he did. And he was driven by his own demons, not by anything done to him. And in the process, he was willing to trample on the rights of anyone, Mary Sue Hubbard, the Church, L. Ron Hubbard.

4762

They are the acts of a man filled with a consuming cancer of hatred, bitterness and vindictiveness who is lashing out. That is the motivation of Gerald Armstrong, and I ask Your Honor that all of the documents be returned; that Mary Sue Hubbard be awarded significant and meaningful damages for the extensive intrusion into her own privacy, and I will leave the amount of those damages to the sound discretion of the court.

Thank you.

THE COURT: All right, we will take a 10-minute recess.

(Recess.)

THE COURT: Okay, we are back in session.

Mr. Harris?

MR. HARRIS: Thank you. Your Honor. I will be short as Mr. Litt stole half my thunder here.

The defendant has made this doctrine of fair game the linchpin of his defense, and there was reference by Mr. Spurlock to the writings of Mr. Hubbard being scripture, and I from time to time read Ambrose Bearce's "Devil's Dictionary" and he defines scripture as "The sacred books of our holy religion as distinguished from the false and profane writings on which all other faiths are based."

I think, Your Honor, that the characterization of Mr. Armstrong of the alleged fair game doctrine begins with his entry into evidence in this court of exhibit RR, which is "Penalties for lower conditions," a policy letter

4763

written in October 1967. His claim is that people can be tricked, lied to, and destroyed pursuant to the scripture, this church doctrine.

The Bible, which I rarely have occasion to quote, Proverbs, particularly Chapter VI, Verses 12 through 15 states:

"A man that is an apostate, an unprofitable man walketh with a perverse mouth. He winketh with the eyes, presseth with the foot, speaketh with the finger. With a wicked heart he deviseth evil, and at all times he soweth discord. To such a one his destruction shall presently come and he shall suddenly be destroyed and shall no longer have a remedy."

4764

Now, courts clearly cannot be the arbiters of scriptural interpretation. And I cite the Court Thomas vs. Review Board, 450 U.S. 707 at 716, 1981.

Religious writings in particular are arcane. It is hard to understand them. They go through evolutionary cycles and phases, as Dr. Flinn has testified.

Yet, the Court was forced in this very process by the defense, by the introduction of exhibit RR and Mr. Armstrong's interpretation of it; plucked as it was from a vast religious literature -- I mean there are oodles out of context and, certainly, colorful.

Exhibit RR itself, cancellation or not, became the focus. No less than three witnesses, including one of the defense witnesses, testified to the fact that exhibit RR was canceled.

In particular, the one I am referring to that we put on was Donna Reeve who was around at the time. And at all times it meant, though colorfully, that a declared person had no rights within the Church; could not receive the Church's services; could not avail himself of the ecclesiastical justice within the Church except to request a committee of evidence.

It was never a license, never a provocation; thus, the Church was forced to put in a series of exhibits, again, all scripture, according to the definition, which entangled the Court even more in what is essentially a doctrinal dispute.

Exhibit 98 clearly shows that exhibit RR was

4765

canceled, at least as early as the 6th of October, 1970.

Exhibit 55 shows that it remained canceled. But in addition, the Church had to put in policy letters that traced the evolution of Fair Game law, so called, from inception, evolution, and demise. And I refer to exhibits 93, 94, 96, and 97.

Questions of Church discipline and the composition of the Church hierarchy are at the core of ecclesiastical concern; thus, the First Amendment prohibits such searching inquiries into such matters.

Serbian Eastern Orthodox Diocese 426 U.S. 696, 1976.

Undeterred by the cancellation which Mr. Armstrong knew full well was in the scriptures as well, he now claims that he would be sued per the policy; yet, knew of no one between 1979 and 1982 that had been sued, whom the Church had sued.

Even if Armstrong believed that the policy was extant and meant what he said it meant, and analogizing his defense to self-defense, as Your Honor did at one point, at the time he showed the documents to Mr. Flynn both at Clearwater and at the Bonaventure Hotel, the danger must have been imminent. There was no imminence in any danger whatsoever at this point, as Mr. Litt has pointed out.

Of course, it is lawful for a person who is being assaulted to defend himself. And he must be a reasonable person believing he is being attacked, has grounds for believing it; does believe that an imminent injury is

4766

going to be inflicted upon him.

It is really hard to see that in the context of an injury, of a possible lawsuit even under Mr. Armstrong's interpretation of exhibit RR.

4767

Moreover, the right of self-defense is not available to a person who was originally the assailant, and here very clearly Gerald Armstrong launched a preemptive attack. He was not assailed. He assailed. The claim of self-defense in the context of this case is contrived for all the reasons that Mr. Litt set forth.

Long before this case arose, long before Armstrong collected a document for the archives. Laurel Sullivan, then under oath in a deposition, explained fair game, and she told in that deposition that the first time she saw exhibit RR it had the cancellation attached to it and it was on the record that it was canceled.

In l976 she testified that exhibit RR meant that the church would not discipline a Scientologist in good standing who had a dispute with a declared person, but would leave it to the civil authorities.

She testified under oath in 1976 other than expelling the person, there were no practices or policies with respect to someone who leaves the church, except to try and counsel them and see if there was something misunderstood or something that did not go quite right. There would be an effort to salvage them. Also, that there were no policies or practices on the attitudes of Scientologists towards someone who disaffacts.

Yet in this trial she claimed that she herself was fair game. And the examples that she gave of what constitutes fair game for her, she cited that a private investigator contacted a former employer representing himself

4768

as being from her parents at a time, of course, when Mr. Litt was trying to talk to her about this case.

She said the church sent a staff member, one Kevin True, to interview her in March of 1983. She said that he wasn't harassive. They had a long, friendly conversation. She liked the guy. He was a nice kid. She took him out to dinner. He later sec checked her, which she agreed to, stating. "Sure, ask me the questions. I really don't care."

She stated that it was fair game that Mary Sue Hubbard didn't respond to a letter to her. Then changed her testimony and said well, maybe it wasn't fair game. Then said it was possible it was fair game, and that Kevin True lied to her father after this nice kid had the interview with her, her father later telling her by the phone, by claiming that he was a friend and wanting her address. He said he was a nice kid and took him out to dinner.

That is fair game according to Laurel, but in a prescient example under oath in 1976, she gave a prophetic hypothetical. In answer to a question in respect to the designation "enemy," Laurel answered under oath:

"Let's suppose that a person was on staff and had access to some training materials. Let's suppose he was a supervisor in a course room. As far as Scientologists are concerned and the organization is concerned, he is an active staff member and a nice guy and doing his job and training his students and everything is fine.

4769

"Well, one day he steals a pack of materials. He had access to them because he was a supervisor. Let's suppose he didn't have the responsibility of taking them off the premises. Let's suppose they weren't his; they belonged to the Church. Well, that is stealing something from the Church.

"If he won't come back and say I am sorry and here they are, you know, if he was madly copying them and writing a book or something in his misuse of the material, well, he would get a writ of expulsion, a declare. He would get a writ of expulsion because at that point he is no longer a Scientologist. He is somebody else. He is working to use the materials of Scientology destructively. And that is something that can't be tolerated. Any certificates and warrants he had would be canceled. He wouldn't be allowed to be trained or processed in any group or organization or mission. He would be considered a danger and might steal again."

This is her back in 1976.

"He would be considered a suppressive person, probably, but mainly for himself because people who do things like that are not usually in very good shape personally and spiritually."

This is what Laurel Sullivan said about Fair Game

4770

and suppressive persons back in 1976 under oath.

Mr. Armstrong cannot, as Mr. Litt said, come to grips with what he was, who he was, and his love for Scientology.

He now claims that he got into Scientology because he thought it was a science; yet, he read the Phoenix Lectures and numerous other documents, numerous other books where very clearly it is stated,

". . .Scientology then today could not possibly be characterized as a science the way the Western world understands science. Scientology carries forward a tradition of wisdom which concerns itself with the soul and the solution of the mysteries of life. It has not deviated."

And again, on the next page,

". . .anything else is Johnny come lately. Scientology is a religion in the very oldest and fullest sense."

Mr. Armstrong read that before he got into Scientology.

He claims to have read Advance Magazine which contains a biography, but, apparently, missed all the references to spiritual gains.

He claims to have read various publications back then before he got into Scientology.

He said, ". . .if it was a church I was joining, I wouldn't have."

Yet, the documents that he claims induced him into Scientology, all of them say, "Church of Scientology,"

4771

various Churches of Scientology.

Mr. Armstrong cannot, will not, tell the Court what his true feelings were in those days.

He claims now that he got into Scientology because Mr. Hubbard was a war hero. He didn't say that on the ship.

He claims now that he got into Scientology because Mr. Hubbard had been to the Far East and spoken with Tibetan Llamas. He didn't say that while he was aboard the ship talking about how he got into Scientology.

He claims now that he got into Scientology because Mr. Hubbard was a nuclear physicist and a scientist. He didn't say that back on the ship in his candid conversation with Mrs. Gamboa. He didn't say it because, Your Honor, he didn't get into Scientology because of any of those reasons.

He got into Scientology, as Mrs. Gamboa testified, because he took a communications course and it helped him. He got into Scientology and got into the Sea Organization because he wanted to help others, not because he was in fear; that is balderdash.

He claims now that the RPF was a prison camp. And, of course, the question of discipline is at the core of ecclesiastical concern and implicates the First Amendment as well.

4772

When Gerry entered the Sea organization, he signed a billion year contract which in my view sounds a bit eternal. He, and I refer Your Honor to exhibit 40, he agreed to abide by the Sea Organization's purpose which was to set up high functioning Dianetics and Scientology Organizations and to clear the planet and the universe, a star high goal surely, and he fully and without reservation subscribed to the mores, discipline and code of the group and pledged to abide by them.

Now, before this court the Rehabilitation Project Force is a degraded experience. It is a substandard prison in which people are forced to undergo sec checks with a lie detector.

Then, while he was boatswain of the Rehabilitation Project Force and graduating from the RPF, Gerry had this to say:

"I am indeed extremely fortunate to have been given this opportunity by LRH to become redeemed and to have been given my sanity. I was always because of the nature of the RPF progressing toward the goal of full honesty and redemption. I became an auditor, a goal every Scientologist has had"

-- and then he ends --

"and to LRH who has given me my sanity and given me the tech with which to help him in his goals for man. Sir, I am a good investment and I will be able some time to repay you."

That was Mr. Armstrong in the late '70's.

4773

Like the spurned lover, Mr. Armstrong can hardly bring himself to say anything good about the religion he embraced and indeed, he claimed that the "Success Story" which is posted on bulletin boards and which people read and so on was from his PC folder which is a lie.

Now, claiming that the church has no corporate integrity whatsoever, Gerry read "understanding corporate integrity," exhibit 47, while he was aboard the ship, and it is true that Scientology is a hierarchical religion, and that then is hierarchical policy by which diverse churches across the world are bound, but nevertheless in 1973 when Mr. Armstrong read this, he was told that the Sea Org was a fraternal organization existing within the formalized structures of the Churches of Scientology.

"It consists of highly dedicated members of the church who take vows of eternal service," and also as he knew that he was aboard Flag, he also read, "The Church of Scientology of California operates a marine mission aboard a chartered vessel. This marine mission is commonly referred to as Flag. It is operated under the aegis of the Church of Scientology of California."

Now, it is to Mr. Armstrong's advantage in this case to confuse corporate and eclesiastical [ecclesiastical] control. He does this because he wants the court to believe that he was personally employed by Mr. Hubbard. The polity of the Church of Scientology makes it appear that it is one big ball of wax, in the manner of say the Roman Catholic Church.

4774

But to say that Scientology organizations across the world are united by a shared hierarchical policy is not to say that you can ignore corporate beingness or that all corporations are somehow the alter ego of the founder.

California itself has long distinguished between the Church and the corporate entity and has made the latter, the corporate entity, subordinate starting way back in Wheelock vs. First Presbyterian Church, 119 Cal. 477, 1897; in that case the Court addressed the issue of what is the proper role of a corporation when it is a religious corporation.

A dispute developed over the purchase of some property for the Church; one faction wanting not to take this property; the other faction wanting to take the property. And the trustees in effect were going with the majority vote.

Some $50,000 was set aside for the purchase. And the Court in effect dissolved the corporation because the Church was at odds within itself and split up the money between the contending groups and said that the ecclesiastical policy governed and not the corporate ones.

Who cares about the corporation any more? It is no longer the vehicle for the ecclesiastical control of the property.

To the same extent, Rosicrucian Fellowship vs. Rosicrucian Fellowship Nonsectarian Church, 39 Cal.2d 121 and others following, ". . .the essence of the corporate

4775

entity is to hold property for the church proper."

And if Your Honor takes a look at the exhibits which we put in evidence last which is exhibit 116, you'll discover that the Archbishop of Los Angeles as a corporation sole is completely and totally subject to the authority of the Pope; serves at his pleasure both corporately and ecclesiastically; that the Pope can transfer the corporation's property and cleave the archdiocese assunder [asunder] and, indeed, a large hunk of the archdiocese went north pursuant to just that.

Armstrong now claims to be personally employed by L. Ron Hubbard; that is hogwash.

Homer Schomer said LRH approved everything aboard the ship as he peeked through the window, including the menu; LRH approval of Armstrong assuming an archives post no more evidenced a personal services contract than the approval of what vegetable, such as broccoli, should be served at dinner.

Armstrong was working for the Church; he knew he was working for the Church, even if he was in the office of the personal office of L. Ron Hubbard.

Exhibit 80 shows the personal office of L. Ron Hubbard as a DBA of the plaintiff. And that was in March of 1980, shortly after Mr. Armstrong petitioned for this post.

Exhibit 29 shows the household unit and the Product Development Organization International as a part of the Church of Scientology of California.

4776

Mr. Armstrong's pay vouchers show to the treasury secretary of the Household Unit and of PDOI.

Items for the archives were purchased with CSC's monies; they were housed in a CSC building.

Laurel told Gerry he was employed by the CSC. And I refer to exhibit 38.

CSC was the owner of some and bailee of the other of the documents that Armstrong stole. It is entitled to the reasonable expenses incurred in an attempt to recover them. Those expenses are embodied in the exhibits in respect to the Tin Goose items excluding Utah. And we ask the Court for judgment.

As I said, I would be short.

THE COURT: Very well.

Mr. Flynn.

4777

MR. FLYNN: May it please the court, normally. Your Honor, I give a closing argument in the same vein as Mr. Harris and Mr. Litt with regard to simply trying to run over the facts before the finder of fact, which in this case is Your Honor without a jury, and to cast the facts in a light which is favorable to my client as an attorney, as I am sure Your Honor has seen hundreds of attorneys do before juries and I submit that we have just heard two such arguments.

However, in this case, although it may be a little bit laborious and a little bit tedious, what I intend to do is give an argument in which I will go through and quote from many of the exhibits that have been introduced in evidence, and I am going to do that for two reasons: Your Honor is getting a copy of the transcript, and since this is a jury waived case, you will be able to correlate and cross-reference right from my argument the facts, and those facts will be directly referenced to the overwhelming pile of documentary evidence that is unfortunately before the court.

However, that documentary evidence is what this case is about. It is the documents that are under seal and it is one of the numerous factors that made this "walking time bomb" find out what the truth is, and it is the documentary evidence upon which this court can rely to find out what the truth is rather than the disparaging rhetoric of church agents, disparaging rhetoric that implicates both Mr. Armstrong and myself in what they would have the

4778

court believe is a massive conspiracy by an attorney from Boston and an individual who spent 12 years of his life working for $20 a week, and who came out with nothing and was forced to sell photographs to try to buy an automobile, against a multimillion dollar empire that even purports to have such things as a fair game doctrine, and SP Declares, and forced lockups, and promissory notes, and releases, all for people who violate this eternal, billion year contract.

They are forced to sign releases, have their PC files culled, as this court has heard unendingly in this courtroom, assigned freeloader debts that they are made to believe can be collected in a court such as this and not in some court a billion years from now.

The level of scam in which this organization has engaged, as reflected by the overwhelming evidence about Mr. Hubbard's background and over the overwhelming evidence of the intimidation technique such as just were recently imposed on Homer Schomer.

4779

The defense was fortunate in this case to come up with Mr. Schomer just weeks prior to the conclusion of the case.

This Court heard Mr. Schomer, an individual in his late forties, early fifties; working for the new pope of the Church of Scientology, David Miscavige; the Chairman of the Board of Author Services Inc.; also running the Commodores Messengers Organization and running the Church; gang-bang sec Checked and spit on by Mr. Miscavige, the new pope and chairman of the board and Norman Starky, his second in command.

The semantics that have been put before the Court as to whether the Fair Game Doctrine has been canceled in light of pieces of paper that are drummed up by this organization, in light of testimony such as Mr. Schomer's -- the cancellation is a myth.

October, November, 1982 to have someone locked up in our society and guarded at the door while being gang-banged security checked on two tin cans and posts that act as a lie detector; having his daughter forcibly disconnected from him which is in their own documents which is before the Court before he represents a potential threat because of what he knows.

I submit to the Court it can be reduced to a simple common sense equation of whether he should weigh these pieces of paper about a cancellation of a doctrine that already is heinous on its face, lie to, sue, cheat, and destroy.

4780

Mr. Walters was sued three times for a meeting with an attorney for conspiracy to violate his First Amendment rights.

Mr. Walters went in posing as a patient to get a tape recording on a psychiatrist; plant another tape recording device, all pursuant to a number of documents that the Court has seen such as the B-l Full Hat.

To say, to use pieces of paper to say that Mr. Hubbard hasn't lied to everyone -- throughout his life he has lied to everything. Everyone is subject to Fair Game to L. Ron Hubbard; to try to wash away what is in the documentary evidence about Mr. Hubbard's lying along with a supposed cancellation, as Mr. Schomer said, which was done for PR purposes, to wash away 40 years of L. Ron Hubbard's lies which he embodied in a doctrine which he happens to call a Fair Game Doctrine with some irrelevant pieces of paper is simply to deny reality.

4781

It is to deny that people such as Mr. Armstrong went through what they went through. As he testified for 10 days on the witness stand, answered over 700 interrogatories, went through 15 days of deposition.

Mary Sue Hubbard came in a couple of days during the trial and left, and she and her husband are off spending their hundreds of millions of dollars that they have scammed from people.

Mr. Litt was right about one thing in his argument, and that is that Mr. Armstrong was a walking time bomb until he confronted this organization. But I submit to the court, the court should inquire what made him into the product that he was. As Mr. Schomer said, a man in his late '40's, early '50's, says from the witness stand, "I don't even know what the truth is anymore"; after being involved in this organization since the late 1960's.

Mr. Armstrong testified as to what the acceptable truth was among the hierarchy of this organization. A Scientologist controls. That is the policy of L. Ron Hubbard. The intent of this organization was always power, money, and information, and it is replete throughout the modus operandi of the organization as reflected in these documents.

The practice alone, Your Honor saw Kima Douglas, one of the most trusted lieutenants of L. Ron Hubbard, break down on the witness stand because this organization which has guardian program order No. 121668 to cull processing files, which every Scientologist in the world knows is an auditing file, which their own dictionary says is an

4782

auditing file.

Mary Sue Hubbard, the No. 2 in command for 30 years, gets on the witness stand and would try to deceive this court that processing files don't mean auditing files, and gets followed up by someone like Vaughn Young who says the same thing in the face of a poor, deceived, admittedly deceived individual such as Donna Reeve coming in, and Your Honor has seen that exhibit, coming in and saying, "I didn't know this was going on."

She never worked in a high security position. The management structure, L. Ron Hubbard, the people who run this organization have been doing it for 30 years. The people in the field who have been duped such as Donna Reeve was aghast at a B-l Intel file culled from her PC file about her sexual history.

To take the position in the light of just a B-1 full hat guardian program order 121669 intelligence chief; Black propaganda, purpose of security checks, that the fair game doctrine has been cancelled. It simply belies reality, Your Honor.

Mr. Armstrong's state of mind, as these documents are going to show, was created throughout the period he was involved by being exposed to such perversity.

This organization masquerading as a religion, operating as a cult when, in fact, it is an intelligence operation, as reflected by the very exhibits before the court, is what made Mr. Armstrong when he found out that the man was totally falsified, his entire background had been falsified as these exhibits show.

4783

All that history, the years of shore stories, the OTO, the OTC, the monies going into Swiss accounts which we saw, that is what made Mr. Armstrong -- what made Mr. Armstrong -- he is or was a product of L. Ron Hubbard.

The new pope, David Miscavige spitting in this elderly man's face.

David Miscavige is a 22-year-old product of L. Ron Hubbard. He is a product of the Tech.

When Mr. Armstrong, obviously, discovered in this documentation what Mr. Hubbard was and wrote the numerous letters that this Court has seen trying to illuminate the minds of some of the people that constituted the hierarchy of this organization, then they immediately order him Sec Checked. And Your Honor heard in a vivid description what would have happened to Mr. Armstrong if he stayed.

What would have happened to Mr. Armstrong is what happened to Bill Franks; what happened to Nancy Dincalci --

MR. LITT: I object. There is no evidence of --

MR. FLYNN: State of mind of Mr. Armstrong, Your Honor.

THE COURT: There is some testimony by Laurel Sullivan. Go ahead.

MR. FLYNN: vividly described by Homer Schomer that that was what was in store for him.

Then all he did -- Your Honor has seen the exhibits where he said he knows the organization's campaign of harassment. He wants to leave and he leaves. All he wants to do is sell some photographs.

He even tells Nancy Dincalci not to contact me

4784

as the big enemy that is out to destroy this wonderful organization. All he wants to do is sell some photographs.

And the next thing that occurs -- and, coincidentally, the same date that Wilhite says, "Come on over" is April 22nd, 1982, which, as Your Honor knows, is the same date as the declare. Coincidentally, Virgil Wilhite, former member of the B-1 Bureau of the Guardian's Office calls Gerald Armstrong on April 22nd, the same date of the declare which accuses Mr. Armstrong of some 26 items, theft, defamation, rumor mongering, a whole host of things, not one of which was proved; not any iota of evidence was introduced in this courtroom to substantiate one item of that declare.

Here is the man being accused of all these things by an organization that has a history of having such things as Fair Game Doctrine; he has photographs taken; he is a walking time bomb. He is fearful that they are going to come and get him. He is fearful of having such things as was done to Homer Schomer done to him.

And Mr. Litt tries to interpret his going down in a frenzy to the CMO building as showing that he was the aggressor.

Mr. Armstrong was in a state, I submit, Your Honor, that only someone who has emerged from 10 or 12 years in an organization such as Mr. Hubbard's, being subjected to the things on a year-in-and-year-out basis that Mr. Hubbard subjected him to could understand that state of mind.

4785

But that state of mind is reflected by the fact that when he did contact me, contrary to the position of the plaintiff and the intervenor, he sent me every document including baby photos or baby items because he had been accused of theft; even though he was in the rightful possession of the documents, as we are going to discuss in this argument. He sent everything.

Does that show a man who is out soliciting documents to attack the organization?

He takes everything and sends it to his lawyer.

I submit, Your Honor, that the overwhelming evidence of Kima Douglas, Mr. Schomer, Gerald Armstrong, Nancy Dincalci, all of these witnesses have clearly shown the Court that the people who have been used, the people who have been intimidated, the people who have been subjected to such things as lockups, security checks, forced confessionals, having their files culled, knowledge that a Fair Game Doctrine even existed, are the people such as Mr. Armstrong, Miss Douglas, Miss Dincalci, Jocelyn Armstrong; They are not the people in possession of the hundreds of millions of dollars going into Swiss bank accounts. They are not the people who have an army of lawyers and an array of L, Ron Hubbard proponents of the Tech who will go out and do almost anything, as Mary Sue Hubbard went to jail for, to perpetrate the drive for information, power, and money that is clearly reflected in the documentary evidence before the Court.

As Your Honor is aware, Mr. Armstrong joined

4786

this organization because he believed in representations made to him.

4787

Those representations were testified at length and they involve all the claims about L. Ron Hubbard which have been testified to. They also incorporate, and I submit that this is important for the court's consideration, they incorporate within them the drive in every human being to find truth, find reality, fulfill a purpose in life, do good, help others. All those things that nature propels man toward, all of those things in life that are significant, all those motivations were in Gerald Armstrong.

To translate that basic desire in human nature into joining a religious organization in the context of the evidence is inappropriate. If the court did that, every human being who goes to college, to medical school, that subscribes to any uplifting goal, could be deemed to be pursuing a religious pursuit.

Scientology was not sold at that time, as the evidence is clear, as a religion. It was sold as a science. The science of knowing how to know, the science of sciences. That is how it was sold.

Where the fraud becomes incorporated is taking that basic instinct in human nature and tying it into L. Ron Hubbard, L. Ron Hubbard's goals, L. Ron Hubbard's academic qualifications, L. Ron Hubbard's professional qualifications, L. Ron Hubbard's 30 years of research into the human mind, L. Ron Hubbard's twice being pronounced dead, L. Ron Hubbard fighting in five theaters in World War II, which is just ridiculous, L. Ron Hubbard being a war hero, L. Ron Hubbard being flown home on the Secretary

4788

of Navy's plane, L. Ron Hubbard being extensively decorated.

That is where the essential thread that permeates the entire organization takes place and that permeates this case takes place. You take the idealistic motivations of someone like Mr. Armstrong and you tie then into the fraud, the willingness of someone intentionally to deceive an idealistic young person for his own gain, which is clearly reflected in, among other things, L. Ron Hubbard's own handwriting, the affirmations, which the court has seen fit to only allow a portion of into evidence because of the sensitive, incredibly sensitive nature of what is really revealed in those writings about L. Ron Hubbard's mind and where L. Ron Hubbard was coming from.

To tie in Mr. Hubbard's malevolent intent as reflected in those documents and in the parade of lies that are reflected in the exhibits before the court with the idealistic aspiration of someone like Mr. Armstrong is where the fraud lies. It's got to do with joining, quote as recited in one exhibit, "L. Ron Hubbard's personal Org" which he also says in the policy "the founder" referring to his personal office as being his, but in one of those solicitations he says, "The Sea Org is L. Ron Hubbard's personal organization."

You tie in this web of intrigue and lies created about the man, you take the idealistic aspirations of almost any young person, and you give then a raft of shore stories, and the next thing you have got them working on a ship that is being run by a profit making corporation

4789

for L. Ron Hubbard, the OTC, where they are lying to governments for the next five years that they are really not Scientology or Dianetics, which he thought he was joining, a science with L. Ron Hubbard to help mankind.

The Massachusetts Institute of Technology tries to help mankind. The United States government tries to help mankind. The local hospital over here probably tries to help mankind.

You take those basic aspirations, all the lies of Mr. Hubbard, put them together with all the intelligence operations that the court has seen and come up with the equation that this organization is a religion is far fetched.

But in any event, you put Mr. Armstrong on a ship, the Apollo, and he is immediately -- what is the first thing that is done to him? He is taught how to lie. He is drilled. A mockup is given.

In fact, when being questioned by Mr. Harris, Mr. Harris said, "Well, explain it. Show us what kind of a drill you get."

And he went through very vivid language the drill he went through way back in 1970 or '71 to lie to people about what this organization was and who he was working for. The organization, I submit, Your Honor, is stuck with the shore story. They are stuck with the shore story about the OTC. They are stuck with the shore story about the friends of Norman Karno. They are stuck with the shore story about the friends of Mr. Snyder's uncle. They are stuck with the shore story about the Scottish

4790

Highland Quietude Club. They are stuck with all those shore stories because they are all designed for one purpose, to conceal and protect L. Ron Hubbard. They are all lies at the time. They are still lies.

The reality of the situation was always and always will be L. Ron Hubbard running and controlling everything as the documents and the testimony proves.

Only he is a man on the run. He can't even come out and hold his wife's hand when she goes to prison for him. He is a man who can't face reality. He's never faced reality. He's never confronted what Your Honor has seen in these exhibits. He's never been able to. He's run. He's manipulated. He's used lies. He's controlled hundreds of millions of dollars, and there are thousands of victims out there. Including people like Gerald Armstrong.

Mr. Hubbard is left with the web of intrigue as to who people like Gerald Armstrong work for. The most salient fact that comes through the whole thing he's the only one he ever worked for.

4791

In reality, regardless of the paper, regardless of all of the creation of shore stories, regardless of trying to hold the personal office of L. Ron Hubbard out as a DBA or the Church of Scientology of California, the one salient truth testified by Laurel Sullivan, Gerald Armstrong, Homer Schomer, Kima Douglas is that all of these people were working for L. Ron Hubbard; they were producing product for L. Ron Hubbard; they were defending L, Ron Hubbard; they were concealing L. Ron Hubbard.

And I list those items and some four or five others which is an exhibit under seal which is the purpose of LRH personal PRO post.

Laurel Sullivan testified about the products to raise money for L. Ron Hubbard; that in reality what these people did, L. Ron Hubbard created these shore stories whenever he needed them for whatever reason he needed them. And like all lies, they are an illusion.

The only reason he needed them is because he was lying. He was lying to people.

There are a host of victims for 30 years, people who got ripped off; people who wanted their money back; governmental agencies.

The only reason they began to inquire into the Church of Scientology was because of the practices such as Fair Game, forced confessions, promissory notes, free-loader debts, monies in Swiss bank accounts, passports being taken from people on board ship; Mr. Schomer being locked up in private corporations in 1982. That is why governmental

4792

agencies inquired.

The theme of the plaintiff and the intervenor was the truth was to attack L. Ron Hubbard and to attack Mary Sue Hubbard. They have all the money.

Mr. Armstrong is left defending a case; to do the one thing he had never been able to do in 13 years in working for L. Ron Hubbard, to tell the truth; to show the Court the documents which are L. Ron Hubbard's documents; show what the facts are. That is the level of confront we are dealing with.

If Mr. Litt and the Church of Scientology and L. Ron Hubbard wished to interpret truth as attack, then I submit to the Court that tells the whole story. That is what Mr. Hubbard has run away from.

If the Court reads the Black Propaganda exhibit in detail, it tells the whole story.

It is Mr. Hubbard attacking those who tried to tell the truth. That is what is taking place in this courtroom.

One of the significant facts about where Gerald Armstrong was coming from and where the Church of Scientology and L. Ron Hubbard were coming from in this entire affair has to do with the fact that they brought the suit.

Gerald Armstrong filed all the documents. They were sent to my office and the office of Miss Dragojevic under seal in the court for adjudication under law of the rights, liabilities, and privileges of these parties.

The photographs, a photograph of L. Ron Hubbard

4793

that portrayed him in a light that was not exactly the way he wanted to be portrayed, the way a Scientologist controls, a photograph that would show him as being a man, a normal man, a man who, as the record now shows, because of that one photograph that the Court now has, a very vain man, would take the critical evidence in the lawsuit, what triggered this matter, and destroy them. That is what they say.

I submit to the Court that they are not destroyed, but Terri Gamboa is willing to take the position that they are destroyed.

Mr. Schomer said that he saw them in her office. And I would leave it to the Court's discretion as to judging the credibility of Terri Gamboa and the credibility of Mr. Schomer or, for that matter, the credibility of any witness on the part of the defendant as opposed to Mary Sue Hubbard, Lyman Spurlock, Terri Gamboa, et al.

But if she wants to take the position that the photographs are destroyed --

When we brought the exhibits into court and what was done with them, I came out to the Hotel Bonaventure and invited the people who were involved in the thing, the Dincalcis and the Douglases to a meeting --

MR. LITT: Objection, Your Honor. Mr. Flynn did not take the witness stand and he cannot testify in this argument. There is no such evidence in the record.

4794

THE COURT: Well it is certainly an inference that could be drawn whether he testified or not.

MR. FLYNN: The Dincalcis and the Douglases, the two people involved in this entire matter, were invited to the Bonaventure because they were principals, and because a few documents are there, and because I am meeting Mr. Armstrong for the second time as an attorney to find out what this entire thing is about, when, as Mr. Armstrong testified, he is in fear for his life.

There are thugs following him. They say they are private investigators. What does Mr. Armstrong know? You are dealing with a walking time bomb. You are dealing with a man who spent 13 years in an organization that specializes in Intel activity, and all of a sudden these people are following him, and he is trying to find out what is going on and he hasn't slept in days.

So, he brings a few of these documents, which incidentally even predate Mary Sue Hubbard and they predate the Church of Scientology. They belong to L. Bon Hubbard who isn't even in the courtroom. He doesn't even have the courage to come forward and say, "Give me my documents back." He sends his wife in as his front for the organization against someone he's been paying $20 a week to for 13 years.

So, a few documents are present in this meeting which is to discuss what is happening to Mr. Armstrong and his legal rights, and this shimmer of the importance of the date.

4795

Maybe there is some importance to the date of when he learned about the Declare. Jocelyn Armstrong says that Virgil Wilhite said, "You are a thief and you have been declared and you are not getting your photographs back." That makes sense.

That makes sense because the Declare is dated April 22nd. Wilhite calls Mr. Armstrong on April 22nd, and then Jocelyn Armstrong and Gerald Armstrong go see him. That makes sense.

She also testified that Marilyn Brewer called him in in mid-May before that meeting, but I submit to the court, the court doesn't even have to engage in the manipulation and attempted distortion of the evidence that I submit is apparent. The Declare was issued on April 22nd. If photographs were taken on April 22nd when Wilhite called Mr. Armstrong, that is when the significant events occurred. That is when Mr. Armstrong, to quote Mr. Litt, went into a frenzy. Fearful people, people in fear go into frenzies. People that are rational and people that are not afraid, they deal with things generally on a more common sense, humane, just basis.

So, the meeting takes place in the Bonaventure. A few documents are there. Mrs. Douglas says she had already seen the documents before.

To translate that event into unlawful use in the overall context of the law in this case, which I am not going to discuss in the right to possession of Garrison and Armstrong in their contract, whatever this contract

4796

is with L. Ron Hubbard and PDK who says that they don't know about it, to translate that into unlawful use where the court is sitting in an equitable proceeding and has heard the type of evidence the court has heard, when Terry Gamboa comes forward and says, "Well, we destroyed the photographs" which Mr. Armstrong is also suing for to get his photographs back. Mr. Armstrong has not destroyed any documents. Mr. Armstrong gave them to the court. The organization and L. Ron Hubbard destroyed that evidence.

Along that vein, Your Honor, it became apparent during this case that there are literally hundreds of documents that are germane to Mr. Armstrong's state of mind, duties, activities throughout the course of the biography project.

Laurel Sullivan testified that there were weekly reports that were sent to Mary Sue Hubbard. Mary Sue Hubbard got on the witness stand and at one point in her testimony, as Your Honor will see, at one point she says she didn't even know L. Ron Hubbard was engaged in the biography project and never gave him permission or anything.

At another point she contradicts that and says, "I only gave him permission to do certain things." At another point she says she only gave him permission to have personal materials of historical interest, which I am going to get into a little more detail about.

Your Honor, I submit that personal materials of historical interest in the light of the exhibits that I am going to read through that show Gerald Armstrong for

4797

a period of almost two years with the full consent of everyone in this organization, including L. Ron Hubbard, and Kima Douglas personally saw L. Ron Hubbard approve what he was doing.

4798

For him to operate for two years with, quote, Church money for L. Ron Hubbard's benefit and Mary Sue Hubbard to come forward and say, well, I never intended for him to get those documents because she is removed from her post by her husband and a new Controller is put in who is then second in command of the Church who does give him permission to come forward and say he never had permission to even collect the Controller Archives when there is a CSW marked as an exhibit approved by Gordon Cook saying he can have the materials, is simply fanciful, Your Honor, for that position to have been taken by Mary Sue Hubbard. And it is also reflective of the position that she took that processing files are not auditing files when all of these exhibits are before the Court of what the organization has done and is continuing to do with auditing information.

And this Court sitting as a court of equity, in light of the character of the evidence, to reward this organization, I submit to the Court, to reward the plaintiff and intervenor by delivering to them the documents back when L. Ron Hubbard does not appear, when people like Donna Reeve or Kermit Miller or Emily Miller or some of those other people pursuant to Operation Rawhide or Guardian Program Order 121699 who, for a period of years, have been mentally raped; for periods of years they have had this huge group of criminals, to quote Lyman Spurlock, 1,100 people engaged in these Intel activities, to even give them the documents back in light of what this organization has obviously been engaged in is simply inappropriate.

4799

I would submit that the Court has shown remarkable restraint throughout this trial, incredible restraint, in light of what this organization has done as reflected in all the documentary evidence, as reflected in the host of lies by L. Ron Hubbard. And for them to come forward and say Mary Sue Hubbard has been mentally raped because Mr. Armstrong's lawyer saw one letter which Mr. Litt says he wonders what the public interest is, well, one part that is on the record as to where the public interest is, as His Honor knows, is L. Ron Hubbard's image. That is what is in the letter of significance, together with the other sensitive material where L. Ron Hubbard's image takes precedence.

For Mrs. Hubbard to say that she has been mentally raped after running an intelligence operation of the character that she has run which can easily be inferred from the exhibits under seal is fanciful, Your Honor.

And for the plaintiff and intervenor to ask for these documents back in light of all of that evidence, these documents should be shown to the world. They should be shown to people like Mr. Morov, the vice president, they should be shown and digested and analyzed for the truth.

And if mental rape equals truth, then everything L. Ron Hubbard has said about Scientology and himself is a lie because the essence of Scientology is to confront the truth.

Now, Your Honor, among the claims that Mr. Hubbard has made -- in numerous exhibits -- so Your Honor will have the transcript and will be able to correlate the

4800

precise lie to the exhibits, these claims are, as Your Honor knows, in evidence as exhibit W. And they are also testified to at some length by Mr. Armstrong.

4801

Mr. Hubbard claims that he fought -- fought, doesn't say served. He was in the military. He knows what serve means and he knows what fight means. He says he fought in all five theaters of World War II.

Well, I don't know whether he is talking about MGM in Los Angeles, but the real theaters, the theaters in the South Pacific, and the theaters in the Russian front, and the theaters in North Africa, and the European theater, the theaters where men got their legs blown off and arms and arms blown off, that have lived in the San Diego Naval Hospital for 40 years or the ones coning back from D-Day who had their legs and arms blown off, who got Purple Hearts, who only had the misfortune of landing on a beach and having a shell dismember them for which they got a Purple Heart, know what fight means, and know what a medal is and know what a Purple Heart is.

Mr. Hubbard claims that in exhibit 500-7I, 500-K, 5OO-Q, 500-X and 500-Z, all under seal. He makes, quote, representation in all those exhibits, and I submit to the court that that representation is designed to do something. It is designed to paint him in a certain light.

He claimed that he was a Commodore in one publication and a Commander of a squadron of Corvettes. And other publications he says he rose to command a squadron of Corvettes, the clear implication, Your Honor, he was in the Navy. He knows what it is to command a battle fleet, a group of ships as opposed to what the reality is. It is fanciful. He says that in exhibit O. That is not under

4802

seal; exhibit R, not under seal; exhibit S, not under seal, exhibit 500-J under seal, exhibit 500-K and exhibit 300-X.

The reason those are different exhibits, it would seem cumulative to the court, but they are all different publications with the sane lies. They are all bio sketches, things in Success Magazine, Advance Magazine, PRO Newsletter, where he says, "Truth is the exact time, place, form and event."

He disseminated these lies in all these publications throughout this period of time. It isn't as if one reference is found in some publication and some editor made a mistake. The publisher made a mistake. L. Ron Hubbard did not know that they were making these false statements about him. They are in all these publications and as you heard Mr. Schomer testify and Kima Douglas and Laurel Sullivan, that man approved everything that went off that ship. He's run that organization with an iron hand and he still does, as Mr. Schomer testified, with these weekly reports that are going out to who knows where, but still with all these clandestine, intel type operations, to run a church?

Mr. Hubbard claims he was crippled and blinded in the war, and at one point he says from overdoses of lead. He says that in "The Story of Dianetics and Scientology," a tape that's been disseminated throughout the world. That is an exhibit. "Crippled and blinded in the war" is in almost every publication; in "My Philosophy" in his own handwriting which is an exhibit in this case says that, and Your Honor knows from having heard the evidence what

4803

that means. That is in exhibit O, exhibit R, exhibit Q, exhibit N, exhibit S, exhibit 500-Q and exhibit 500-Y.

Just to give the court an example, matters of medical record that he was twice pronounced dead; exhibit S, exhibit R, exhibit O, all incorporated into his Naval background and his claim to be crippled and blinded and his claim to be a war hero. It is nonsense as Your Honor knows.

The first casualty in the Far East; exhibit N, exhibit S, exhibit 500-X.

Your Honor heard from Captain Moulton. Captain Moulton says that L. Ron Hubbard told him a story about how the destroyer "Edsel" went down with all hands and Hr. Hubbard somehow got ashore and took machine gun bullets in the kidneys and went up and hid in the jungle for a period of weeks, hopped on a life raft with the machine gun bullets in his kidneys, and then sailed 75 miles on the life raft.

Mr. Hubbard should go down and visit some people in the San Diego Naval Hospital or elsewhere and see people who have had bullets in their kidneys.

He claims he was flown on the secretary of Navy's private plane. That is in exhibit N, S, and exhibit 500-X.

He claims in one exhibit he was awarded 28 medals and palms; in another exhibit, 21 medals and palms.

4804

Exhibit 500-V, exhibit 500-7I's, exhibit N, and exhibit 500-X claims that the character Mr. Roberts was L. Ron Hubbard.

Well, your Honor heard some testimony on that with regard to the U.S. S. ALGOL and how a few days before the ALGOL sailed into combat Mr. Hubbard found, in quotes, a Molotov cocktail in the No. 1 hold.

The very next day Mr. Hubbard is relieved of duty and sent to the military school of government.

Thereafter the ALGOL went into combat.

I would ask the court to question or infer when the orders came down; even though there is no evidence in the record when the orders came down, that the ALGOL was going to go into combat. And I would submit to the Court that a logical inference could be drawn it was a few days before Mr. Hubbard found the Molotov cocktail. And then he held himself out as being the hero, Mr. Roberts.

In exhibit R and in exhibit S he says he was actually healed and reclassified for full combat duty.

At another point he says that within two years he did that; in another place, by 1947. Your Honor knows from the exhibits throughout '46 to '51 he is filing claims with the VA trying to increase his pension, claiming a host of ailments to get money.

The records say -- and there are many references to this -- that "My Philosophy," being the critical one and exhibits Q, 500-Y that he was personally disabled physically, but ". . .this officer has no neurotic or psychotic tendencies

4805

whatsoever."

Well, Your Honor, I submit that that is -- was designed in Mr. Hubbard's wind to do something. It was designed to show that he was a war hero who had been wounded. But there is really nothing wrong with his emotions and his mind. But that he had to overcome the physical wounds with his discovery of Dianetics and Scientology which he says is how he did it.

And as Your Honor knows, there is no war wound. There is no personal disability physically other than his duodenal ulcer.

He says he worked his way back to fitness and strength in less than two years.

Exhibit Q, exhibit 500-Q, he studied when he couldn't see.

As His Honor knows, he is off marrying Sarah Northrup August 10, 1946 and running around with Parsons, the head of OTO, the Black Magic cult.

His address is 100 Orange Grove, South Pasadena, California.

In 1946 he claims he is studying when he couldn't see. He goes off and gets married bigamously; forms a corporation with Jack Parsons to buy some type of a boat in 1946; says he resigned his commission rather than assist government research projects; studied when he couldn't see, which is in exhibit Q, "My Philosophy."

Resigned his commission rather than assist a government research project in exhibit S.

4806

Your Honor, it is obvious throughout the VA records from 1946 through 1951 that he was seeking retirement from the Navy with a pension; the government research project was just something that Mr. Hubbard -- Your Honor can see the thread right from the beginning.

Mr. Hubbard also claims to be the victim of the government, the government research project right from the very beginning; it is fanciful. It has nothing to do with the facts.

He claims that he worked for Naval Intelligence breaking up a Black Magic ring. That is exhibit 500-J.

That exhibit, Your Honor, is in L. Ron Hubbard's handwriting. And his address when he wrote it -- strike that -- his address was the same address as Jack Parsons as reflected in exhibits under seal.

In 1969 he wrote that he was working for Naval Intelligence breaking up a Black Magic ring in his own handwriting when it is obvious from all the other exhibits under seal that he was working with Jack Parsons. He took Jack Parsons' girlfriend Sarah Northrup and went off and married her.

There were just lies within lies within lies. Your Honor.

He claims he was an intelligence officer replaced by 15 officers of rank; extensively decorated in exhibits O, R, N, exhibit 500-K.

In his education, he claims that he was a civil engineer in exhibit O, exhibit N, exhibit S, exhibit 500-W,

4807

exhibit 500-X; claims that he has a bachelor of science degree in exhibit O, exhibit N, exhibit S, exhibit 500-W, exhibit 500-S; claims a PhD in exhibit O, exhibit N, exhibit 500-X; claims he is an atomic physicist in exhibit P, exhibit S; Mary Sue Hubbard had to admit, of course, that he is not an atomic physicist.

He claims he graduated from Columbia College of Engineering School at George Washington University in exhibit O, exhibit N, exhibit R, exhibit 500-X; he claimed he attended Princeton postgraduate; his representation was that he went to Princeton University.

The testimony is that there was a military school of government at Princeton during World War II. They trained the "90-day Wonders" at Princeton.

To hold himself out as having gone to Princeton University when he is removed from the ALGOL and he goes to the school of government at Princeton University is more of the lies within the lies.

4808

He claims that he took the first U.S. course in nuclear physics at George Washington University; exhibit N, exhibit S, which he flunked, but it was obviously not the first course in nuclear physics.

He claimed between 1924 and 1929 he was educated in Asia and studied with Llama priests; exhibit N, exhibit S, exhibit 500-X. This was of some significance to Mr. Armstrong because Mr. Hubbard represented and Mr. Armstrong believed that Mr. Hubbard was combining the wisdom of the East with the scientific and educational background obtained in Western universities.

Now, that is a significant thing. To Mr. Armstrong as he testified, he thought that Mr. Hubbard was over there studying in lamaseries for four years and engaging in deep meditative contemplation and intense personal discovery combined with his scientific background.

Well, Your Honor will recall the exhibits in Mr. Hubbard's handwriting where he says, "The problem with China is there are too many Chinks here." This is after he's flunked out of at least one high school and left another, and his father is trying to get him into a school in Virginia to get him into college.

Similarly he claims a long association with holy men in the East, and he returned from Asia to school with the death of his grandfather. That is in 500-X.

The first is in 500-Q.

Well, Your Honor, as Mr. Armstrong testified, his grandfather died in an entirely different period and

4809

he claims he was returning from Asia because of the death of his grandfather for.

Expeditions.

He claims he was involved in leading the Caribbean motion picture expedition which did underwater photography and was done for the hydrographic office of the United States government, and he provided valuable materials to the University of Michigan.

It was a group of college kids. After he flunked out of college, he got on a charter ship that was run by other people, a typical charter group. He sold shares to other college kids. He had sailed for a little period of time. The whole thing was a disaster, and the father got sued for it.

Those claims are made in 500-J, 500-K, 500-Q, 500-X and 500-Z.

He claims in exhibit N and exhibit S he led an expedition into Central America.

4810

He claims he headed three further expeditions to study savage peoples and cultures; exhibits N, S, and 500-X.

Similarly from 1933 to 1941 he visited many barbaric cultures.

He claims he did the first complete mineralogical survey of Puerto Rico; exhibits 500-I, 500-Q and 500-Z.

He claims he led the Alaska radio expedition for the United States government.

He rewrote the Alaska Pilot. He chartered unmapped coastline.

In exhibit 500-I he was the initiator and discoverer of LORAN. Those claims are also made in 500-K, 500-X, 500-Q, 500-I, and 500-Z, with the LORAN claim being made in 500-I.

As Your Honor knows, he went up the inland waterway to the tip of Alaska, the southern tip at Ketchikan in a 28 foot sailing vessel with his wife on a little yacht cruise.

In connection with his health and the disability he claims that he suffered from his Naval career as a result of being wounded in combat, he claims that in 1950 he was given a perfect score in mental and physical fitness reports.

Well, there is an exhibit in 1951 where he is seeking to increase his percentage for a host of ailments. That is in exhibits O, R and exhibit S.

He claimed in 1949 he was reclassified for full combat duty; exhibit O, exhibit R and exhibit S.

4811

Well, he got a pension to get out of the Navy. He claims in exhibit Q he was blinded with injured optic nerves and lame with physical injuries.

4812

That is "My Philosophy' in his handwriting which is widely disseminated.

Your Honor knows from the affirmations in his own handwriting and from all the medical records what the truth is. The truth of the matter is that he had some conjunctivitis.

I submit, Your Honor, an inference can be drawn that that conjunctivitis relates from his malingering.

The affirmation is that he used his hip as a pose. He used his eyes as an excuse to avoid school. He went to the VA to lie to then to get a pension.

He even says in his affirmations that he'll walk out of the VA examination, as Your Honor will recall, and laugh at them.

He says it is okay for him to tell lies.

He says he can tell lies to people. It is all right for L, Ron Hubbard, he writes in his own handwriting in 1946, writes during the period of the origin of this science. He also says he has a right to be merciless to people in those same writings and that men are his slaves. That is a little from those writings that are in evidence.

He claims he spent a year in a civilian hospital after the war which he paid for himself. That is exhibit 500-XX.

Well, the year after the war, as Your Honor knows, he was running around with Sarah Northrup, getting involved with Allied Enterprises with Jack Parsons and the OTO and making frivolous claims to the Veterans Administration.

4813

He says he was supposedly hopelessly crippled and a burden upon family and friends in exhibit Q. That is when he went off and married Sarah Northrup bigamously August 10, 1946.

He said he rose above the cause of all human aberrations and problems. That is throughout Scientology literature as testified by Mr. Armstrong.

Your Honor, if Mr. Hubbard rose above the cause of all human aberrations and problems as reflected by the lies he told currently, such as in the Dive Bomber, then truth does equal lies.

Then he claims he was a blood brother of the Black Foot Indians, exhibit N, exhibit 500-Q; that he studied under Commander Thompson who was a personal student of Sigmund Freud; studied with Thompson in the 1920's in Washington, D.C.

That is what our claimed misrepresentation is, not whether a Commander Thompson exists.

As the other exhibits will show, Mr. Armstrong even wrote in the fall of 1981 that he had not yet located Commander Thompson. He said, "Don't make the claim until you can locate him. And it has not been done yet." That is one of the things that he wrote in the letter.

But the claim that at the age of 12, which is what Mr. Hubbard then was, he studied psychoanalysis under a student of Sigmund Freud as opposed to knowing a Snake Thompson who happens to be a Naval Officer who was probably friendly with his father who he may have met at a party is

4814

evidence of where Mr. Hubbard comes from.

Your Honor has heard extensive evidence in exhibit T and exhibit 500-Y at page 17 about the Dive Bomber.

Mr. Hubbard claims in exhibit 5OO-Y at page 17 that he wrote the Dive Bomber that is in the tape Dianetics and Scientology and is disseminated throughout the world and that in that exhibit he says that he took the $10,000 in bills which he was paid after the war and put them in a safe deposit box.

Well, in 1980 when they are trying to raise money for the defense of Mary Sue Hubbard and the Safe Environment Fund, they invite several thousand people at a cost of, I believe it was, $20 per ticket, I believe it was, to the Hollywood Palladium, telling these people that the Dive Bomber, the movie which was going to be shown to solicit this money, was written by L. Ron Hubbard.

All of those people went there; they all paid the $20 and they all believed -- Laurel Sullivan read from L. Ron Hubbard; Gerald Armstrong went out and tried to find out.

He went back to Laurel Sullivan at that tine in early 1980 and said, "There are no screen credits for him. We have got to be careful. That might not be accurate and all of these people are coming."

And Laurel Sullivan and Gerald Armstrong, being the devotees that they were, said we'll accept Ron's word.

So they read the documents which Your Honor has

4815

seen where he says the same thing. And he makes ridiculous assertions in the documents.

He says that the $10,000 was a check. And he put it in a safe deposit box until the end of the war and afterwards, he closes up his posh Mew York apartment and he went on a cruise.

Well, Your Honor knows from all -- he is writing the VA from 1946 to 1950 saying, "I am ill, I am broke. Give me more money."

THE COURT: I think we'll take a recess at this time.

We'll reconvene at 1:30.

(At 12:00 p.m., a recess was taken until l:30 p.m. of the same day.)

4816

LOS ANGELES, CALIFORNIA; FRIDAY, JUNE 8, 1984; 1:28 P.M.

oOo

THE COURT: Very well, in the case on trial let the record reflect that counsel are present.

You may continue, Mr. Flynn.

MR. FLYNN: Thank you, Your Honor. Your Honor, I am just going to finish several of the representations in the particular context, and the particular context that all of this relates to is the fact that as I come up to the more technical areas of Mr. Armstrong's defense, this is where Mr. Armstrong was coming from in 1980-1981.

These were the documents that he was collecting. These were the beliefs that he had about the background of L. Ron Hubbard. These were the things that had been represented to thousands of people, including to himself, and his job in the biography project was to substantiate Mr. Hubbard's image and to sell Mr. Hubbard's image through the biography, and Your Honor is aware of the exhibits that have been made exhibits to the case, that relate to the amount of money that L. Ron Hubbard was going to receive from this biography project.

4817

So Mr. Armstrong was in the position of collecting the very documents in which all of these claims were made to sell the book. And that is what the whole biography project was about.

There were further claims that Mr. Hubbard [was] the provost marshall of Korea. That is made in exhibit J and exhibit 7I's.

Claims that he was a Hollywood director, exhibits 500-Y and 500-K; claims that his grandfather had owned a cattle ranch in Montana, exhibits N, 500-X. And what we consider to be a very important issue in the case, the fact that thousands of Scientologists believed and were represented in various documents, including "The Auditor," including the exhibit "What your fees buy," exhibit ZZ and exhibit 500-5H, that L. Ron Hubbard had forgiven thirteen and a half million dollars of debt; that he had never received any money from any Church of Scientology organizations, including royalties, and that he received, "less pay than a staff member."

Those representations were made very specifically to justify the high prices for courses that are set forth in one of the other exhibits.

And lastly, Mr. Armstrong was made to believe that, Honesty is the Road to Sanity, by L. Ron Hubbard, one of his favorite quotes. And the biographical surveys that are under seal show that the most important characteristic to all of the people surveyed, 66 percent of the people answered the most important thing was honesty.

4818

Indeed, as the exhibits show, the underlying contract which Mr. Garrison entered into was predicated upon the fact that it would not be a puff in Mr. Garrison's eyes, but that he had the right to gain possession of all of these personal and private documents and that that would be the basis for the biography.

That is also the state of mind Mr. Armstrong was in; not only with regard to this pursuit of documentation about what the truth of Mr. L. Ron Hubbard was, but also with regard to the fulfillment of the contract itself, the very basis of the contract which is set forth in the letter of Sheila Gaiman which is an exhibit in this case.

And lastly, Mr. Hubbard even lied about his age, as Your Honor knows. He joined the Montana National Guard and he misrepresented his age while at the same time he claimed to be studying with Commander Thompson as a student of Sigmund Freud.

4819

Now those are the claims that were made. Just running through quickly the documents, and I understand there are numerous documents, Your Honor, understand there are numerous documents under seal, but just running through quickly the reality, the truth, the facts of what L. Ron Hubbard's life really was in terms of these hard-core representations that I have laid out on these specific exhibits, aside from the overall false picture that was created, the facts are in exhibit 500-II -- first in exhibit 105, L. Ron Hubbard was commissioned in the United States Naval Reserve on July 2, 1941.

On December 17th, 1941, 10 days after Pearl Harbor, he was ordered to Australia and arrived in Australia, and exhibit 500-II states that he left the continental limits of the United States on December 17th, and he arrived on January 16, 1942, and then he arrived back in the United States on March 23, 1942.

Exhibit 500 double J shows that on February 17, 1942, approximately 30 days after arriving in Australia, he was ordered by the Naval attache to return to the United States, and 500 double J states, "Lieutenant JG Lafayette Ronald Hubbard, USNR, ordered returned by USS Shomont. He is unsatisfactory for any available assignment."

It is noted that it is to be put in the finished discipline pile of Mr. Hubbard.

Exhibit 500 double K, a letter dated February 14, 1942 from the US Naval Attache in Australia, again Mr. Hubbard is being ordered returned to the United States,

4820

and this L. D. Casey, OS Naval Attache states, "This officer is not satisfactory for independent duty assignment. He is garrulous and tries to give impressions of his importance. He also seems to think that he has unusual ability in most lines" et cetera.

Exhibit 500 double L shows that Mr. Hubbard, after being returned from Australia, goes to work in the office of the cable censor and the cable sensor states that the chief cable censor is cognizant of the letter from the Naval Attache, Australia, dated February 14, 1942, and has considered the suggestion made therein.

"It is therefore recommended that no disciplinary action be taken at the present time as it is thought that the subject's qualifications may find a useful outlet in the office of the cable censor, New York."

Thereafter, Mr. Hubbard is ordered to take command of the US YP422, a converted trawler, that is then in the Boston Naval shipyard, and he begins that assignment. On July 28, 1942, and that is exhibit 500 double N. Within 60 days after taking command of that vessel, while it is being outfitted in Boston harbor, he is relieved of duty.

Continuing the chronology, he is then sent to Miami, Florida to submarine chasing school. This is set forth in exhibit WW. He goes to that school from November '42 to January 1943. Exhibit WW states that during that period of time he is under instruction.

Thereafter in January 1943 Mr. Hubbard is ordered

4821

to take command of the PC 815 while it was being outfitted in Astoria, Oregon.

The outfitting process lasted from January 20 to May 18, 1943. That is exhibit W and exhibit 60.

On May 18, 1943, the PC 815 leaves Astoria, Oregon for a shakedown cruise to San Diego.

4822

It leaves port at 9:16 p.m. This is -- the initial cruise for this vessel with Mr. Hubbard in command.

Approximately six hours later, at approximately 3 o'clock a.m. Mr. Hubbard, a few miles off the coast of Oregon, contrary to orders as set forth in exhibit 60 in his own note, fires 8611 depth charges at his first sonar contact, which he concludes in his own report is not a submarine.

He then fires his guns at a floating log and then for the next 40 hours he chases a mythical submarine off the coast of Oregon.

There's an inquiry into Mr. Hubbard's conduct by an Admiral Frank Jack Fletcher. In exhibit 91, paragraph 5, the following conclusion is reached:

". . .analysis of all reports convinces me that there was no submarine in the area.

"Lieutenant Commander Sullivan states he was unable to obtain any evidence of a submarine except one bubble of air which is unexplained except by turbulence of the water due to a depth charge explosion.

"The commanding officers of all ships except the PC 815 state that there is no evidence of a submarine and do not think there was a submarine in the area."

Mr. Hubbard then, as Your Honor is aware, sailed

4823

down to off the coast of Mexico and fired three shots on the Coronados Islands virtually causing an international incident. There was an inquiry into that proceeding which is under seal. And Mr. Hubbard was thereafter relieved of command of the PC 815.

The Board of Inquiry, exhibit 500-3E's, a fitness report was filled out at that time which is exhibit SS in which it was stated,

". . .consider this officer lacking in the essential qualities of judgment, leadership, and cooperation. He acted without forethought as to probable results. . ." et cetera.

Thereafter Mr. Hubbard goes into a hospital for a period of time claiming that he is ill, which is set forth in exhibit 500-EE. He is assigned to clerical duties in San Pedro, California.

And in December, 1943 he is sent to the U.S. S. ALGOL as set forth in exhibit WW while being outfitted in a shipyard in Portland, Oregon.

4824

Thereafter, on September 27, 1944 Mr. Hubbard, as set forth in exhibit double X finds the Molotov cocktail in the No. 1 hold and the next day he is relieved of duty.

Thereafter in September 1944 to January 1945 he goes to the Princeton Military School of government in Princeton, Mew Jersey. From January, 1945 to September, 1945, as set forth in exhibit WW, he is under instruction at Monterey, California, and he is an outpatient with regard to treatment for ulcers.

From September 5, 1945 to December 4, 1945, as set forth in exhibit WW and some of the medical records, he is in an inpatient at the Oak Knoll Military Hospital being treated for ulcers.

As is set forth in exhibit WW, Mr. Hubbard received four standard medals and awards given to servicemen who served in the Navy in World War II.

Thereafter, as set forth in exhibit 500-4J and 500-4M he became involved with Jack Parsons, the head of the Black Magic Crowley Cult as testified to by Mr. Armstrong, the OTO, and as written by Mr. Hubbard.

There are various exhibits under seal, Your Honor, which relate to the letter of admonition given to Mr. Hubbard for firing shots, which is exhibit 500 double R and 500 triple E.

Contrary to the claims that Mr. Hubbard was making with regard to living in posh apartments and having $10,000 in the bank, exhibit 500 triple J shows Mr. Hubbard not paying for his uniforms and other exhibits, specifically 500-3H and 500-3J show that he hadn't paid for an outstanding

4825

bill from 1939 to 1940 to the First National Bank of Alaska.

He had not paid for uniforms in Australia and he was being chased by creditors.

As set forth in exhibit 500-4B Mr. Hubbard is living at 1003 South Orangegrove Avenue on March 18, 1946, in which he wrote a letter to the Veteran's Administration in which he states that he is seeking an award for disability and he wants to contest their findings, and he states,

"My income at the present time due entirely to service connected injuries is zero. Would you please advise me as to the steps I should take to gain further pension."

In exhibit 500-4C Mr. Hubbard again writes to the Veteran's Administration explaining what he is doing at that time. On 21 November, 1946 he again writes to the Veteran's Administration in exhibit 500 triple W and he states, "I was unable to report for further examinations because I was both ill and broke."

In 500 triple V Mr. Hubbard is in the Hotel Belvedere in New York and he again states that "A friend has been kind enough to finance a trip back East in return for financial advice on an expedition. As far as I can tell, I shall remain East for some time."

In exhibit 500 triple S dated January 27, 1948, Mr. Hubbard states,

["]I left school as physically unable to continue the studies, being ill and broke. I did not sufficiently question my checks. I cannot imagine how to repay this $51 as I am nearly penniless."

Contrary to the representations of Mr. Hubbard

4826

that it was a physical ailment and not psychiatric problems that he was suffering from, on October 16, 1947 Mr. Hubbard writes to the Veteran's Administration and he states, "I cannot account for nor rise above long periods of moroseness and suicidal inclinations."

And he is seeking treatment.

4827

Exhibit YY dated August 1, 1951 is a report of a physical examination in which the individuals taking the report referring to Mr. Hubbard states,

"This veteran gives a long history of three years of sea duty over approximately four and a half years of Navy duty as an officer and states that somewhat over a period of a year of his service was spent in hospitals."

In the latter period he gathered from what he said that the duty was rather strenuous,

". . .his first assignment in 1942 being with a merchant ship which was assigned to transport troops."

The record indicates there was no such assignment.

Later he states, ". . .he served with escorts in the North Atlantic."

The record indicates there was no such duty.

". . .on one occasion in 1942 he fell down a ladder and struck his right hip. But there were no facilities aboard ship and it was necessary for him to go on without any aid. He also gives a history of injuring his right shoulder. Just how is not clear. And of developing numerous other things, including duodenal ulcer. . ." et cetera, the conjunctivitis, the highly nervous state.

He goes on,

". . .he applied for retirement

4828

from the Navy which was eventually turned down."

Then it goes on to talk about treatment for various orthopedic treatments since being in the service.

He states,

". . .Hr. Hubbard claims he was completely recovered as a result of Dianetics after 1947 and passed all physical and mental tests with a perfect score."

On October 28, 1969 Mr. Hubbard took the position -- and this document is in his own handwriting in which he writes an article about the fact that, quote, Hubbard broke-up Black Magic in America."

And he states among other things,

". . .the reason the news of world won't print the Hubbard-Crowley story is probably they knew it would rebound to L. Ron Hubbard's credit."

He was involved -- he talks about Jack Parsons being, quote, involved with the infamous Black Magician Crowley who called himself the beast, No. 666; among other things, that they had savage and bestial rites; that he was head of the branch, the address at 100 Orange Grove, Pasadena, California; that is the same address or a similar address, the address being on the letter 1003 Orange Grove Avenue, Pasadena, California where Mr. Hubbard wrote to the VA in 1946.

This is written as if it was written by someone else. And Mr. Hubbard states, referring to himself,

". . .he went to live at the house and investigate the Black Magic rites and the

4829

general situation and found then very bad. He was still an officer of the U.S. Navy."

Mr. Hubbard goes on to state,

"The mission was successful beyond imagination. The house was torn down. Hubbard rescued a girl they were using. The Black Magic group was dispersed and destroyed and has never recovered."

The purpose of that exhibit, Your Honor, is to indicate falsehood within falsehood as to what Mr. Hubbard was actually doing and what actually he claimed he was doing. And that was written in 1966 with regard to his past.

And I submit an inference can be drawn by Mr. Hubbard referring back to his post-war period with that type of description; it indicates that he was attempting to justify his prior conduct to have people like Mr. Armstrong rely on it.

As Your Honor is aware, exhibit 500-4L relates to the situation involving the birth of Alexis in which Mr. Hubbard, in the early 1970's follows instructions of Jane Kember; has a Guardian's Office agent go and read to Alexis a letter which he drafted stating that Alexis was not his daughter, even though he was married to Sarah at the time. And even though it is testified to by Mr. Armstrong that she had red hair and even though he dedicated a book to her in which he denies that she is his daughter and disparages Sarah's mother.

The exhibit itself Mr. Armstrong found of great significance as testified to with regard to revealing the

4830

character of Mr. Hubbard. And I won't read the portions that are relevant. But I submit that it has a great deal -- it relates greatly to the state of mind of Mr. Armstrong with regard to his belief and the character of L. Ron Hubbard and his discovery of the real character based on documents of that type.

And in exhibits 500-4U and 500-4U in 1980 a messenger reported that Mr. Hubbard had denied that he was involved in the foundation of the Church of Scientology organizations.

As exhibit 500-4V indicates, which is a letter to Helen O'Brian [O'Brien], Mr. Hubbard states that he is going to start an organization using, quote, the religion angle.

4831

I submit that would indicate the sincerity of Mr. Hubbard's intentions with regard to the religious convictions that he possessed in connection with originating the Church of Scientology as a religion.

In that document he also speaks of how much money could be earned with respect to selling Dianetics.

In a variety of exhibits, which I won't take the time to read through, but they are exhibit U, exhibit 500-4P -- exhibit 500-U, exhibit 500-4T, exhibit 500-4W, exhibit 500-4Z, and exhibit 500-5B, Mr. Hubbard, as Your Honor knows from hearing the testimony, at various times claimed, for example, in exhibit U in a letter to Rona that he was not a mental healer and a mental practitioner.

In the other exhibits, 5-4P, and 4T and 500-W he states he is a mental healer. In another exhibit, 500-5V he states he creates an organization to try to infiltrate psychology in order to try to sell Dianetics through this psychology organization, the NAAP.

In another document Mr. Hubbard states that he is an author, not a mental healer and he is working from the field of nuclear physics. In yet other documents Mr. Hubbard states that he is not a science fiction writer, but he is an adventure writer.

All of these items, as they begin to accumulate between 1980 and 1981, had a significant impression on the mind of Mr. Armstrong with regard to sorting out the truth of the origins of this organization and Mr. Hubbard.

With regard to Mr. Hubbard's claim that he

4832

had resigned from the Church of Scientology in 1966, that he did not, as he set forth in the policy, "The Founder" that he did not control the church. Did not conduct management duties; exhibits 500-5V, 500-5X, 500-5Y, 500-5Z, and 500-6A are all illustrative, and I indicate just illustrative of the fact that after the resignation, Mr. Hubbard, as indicated in many of these exhibits, continued to control the Church of Scientology.

For example, sending, in exhibit 500-6A, instructions with regard to electing a board of the Church of Scientology of California, electing a board of the FCDC, giving various orders, instructing St. Hill to hold his 10 percent from Swiss banking, to get US 10 percents flowing directly to OT base, and numerous other instructions with regard to the operation of the organization.

These documents indicate moneys being placed by Swiss bank accounts, directly from Church of Scientology organizations during this period of time, Swiss bank accounts in Mr. Hubbard's name and Swiss bank accounts in the Church of Scientology name.

They indicate, for example, in a letter dated 14 September, 1967 Mr. Hubbard states, "To calculate the 10 percents and to send them. Calculations of all sums used by me as C of S agent on Rhodesian mission."

There are numerous exhibits set forth in these documents of that type. One illustrative document is a check which is exhibit 500 5X dated March 17, 1969, payable to Mary Sue Hubbard, OTC account in the amount

4833

of US dollars 19,788 drawn on a Swiss bank corporation in the name of Church of Scientology of New York.

It is submitted, Your Honor, that the OTC corporation is the corporation that Mr. Armstrong worked for, and it indicates payment of church moneys directly to OTC, of which there is testimony that Mr. Hubbard owned 98 out of a 100 shares.

4834

In exhibit 500-5Y there are bills for payment into Mr. Hubbard's accounts. They range from 66,000 pounds, 275,000 pounds, 200,000 pounds, 75,000 pounds, and billings on the heading of Operation and Transport Services Limited.

Exhibit 500-5Z indicates instructions to the Church of Scientology of California with regard to board minutes in which are set for in Mr. Hubbard's own handwriting and billings by Mr. Hubbard to Church of Scientology of California accounts and monies in Swiss bank accounts showing the balances that came from Church of Scientology funds, contrary to the representation that Mr. Hubbard made in "What your fees buy" that he never received any Church of Scientology funds.

There are numerous exhibits which I won't take the time to read through that are set forth in exhibit 500-6E, 500-6F, 500-6H, 500-6J, 500-6K, 500-6L, 500-6M, 500-6N, 500-6P, 500-6Q, 500-6R, and 500-6S with regard to the way Mr. Hubbard deals with people who oppose him.

Your Honor will recall some of the language in these exhibits with regard to attacking people, using the media, using the law as a tactical suit for purposes of harassing people and language of that nature which is set forth at length in these exhibits.

For example, just one, 500-6M, "Action. Don't defend; attack."

Those are merely illustrative of the types of documents that Mr. Armstrong collected in this project with regard to the beliefs that he had based on representations

4835

that were made to him before he undertook the biography project and what he found once he got into the documents.

Your Honor, with regard to the issue of Mr. Armstrong having permission to collect documents in the biography project and Mary Sue Hubbard's knowledge of the document collection process, what the documents were being collected for and, most significantly, what documents were being collected to be used for the biography, there is whole series of exhibits which become extremely cumulative in nature with respect to the fact that the entire organization was aware of what Armstrong was doing.

To begin with, exhibit F is the petition of Gerald Armstrong to L. Ron Hubbard which Kima Douglas has testified was personally approved by L. Ron Hubbard.

In that document, in that petition, the very first document that initiated the project, Mr. Armstrong states,

". . .currently this is not being done adequately; just three days ago I came across a box of very old papers in Del Sol which were known to the PRO's and others here. These included R-writings from the '30's and '40's, R grade school English class essays and poems and an R diary from the trip to Asia and many other documents; also in Del Sol I found some documents from R's Navy period which will now be used in press legal action, documents researched as most for subject in his legal battle."

4836

This exhibit was sent to Mary Sue Hubbard. The exhibit was approved in the original by L. Ron Hubbard. And exhibit Y, which was produced, shows Mr. Hubbard approving this.

Mr. Hubbard is, thus, aware that the very types of documents now under seal such as English class essays, documents of that type, were collected by Mr. Armstrong right at the inception of the biography project.

It indicates that Mr. Hubbard is aware that his Naval records have been collected by Mr. Armstrong.

He then approves the petition to use the document for purposes of the biography.

4837

In fact, Mr. Armstrong requests permission from Mr. Hubbard to "collect up all R val docs from around the world, collect R writings of any kind possible and liaison with the biographer for documentation and data."

Thus, right from the outset Mr. Hubbard gives permission to Mr. Armstrong to collect those types of documents.

On February 8, 1980 Mr. Hubbard, as set forth in exhibit Z, proves Mr. Armstrong's R biography and new post nonexistence formula which was also sent to Mary Sue Hubbard. In there Mr. Hubbard states, "There is quite a bit of data around which needs to be gathered up I am sure and which has been lost track of, so the work you are doing to collect it up is appreciated."

Once again Mr. Hubbard knew that Mr. Armstrong was collecting documentation of the type set forth in the petition, personal items.

On February 5, 1980 Mr. Armstrong writes to Mary Sue Hubbard, and he states, "Attached is my nonexistence formula which I sent to L. Ron Hubbard."

Well, the prior exhibit, the response of L. Ron Hubbard to the non-existence formula which was sent to L. Ron Hubbard but was not produced by the plaintiff or the intervenor.

Mr. Armstrong states to Mary Sue Hubbard, "I am assembling whatever data, docs, et cetera we already have at SU." That is the Special Unit.

Mrs. Hubbard testified that she never gave permission to Mr. Armstrong to collect the docs at the

4838

Special Unit. Here Mr. Armstrong is specifically stating that he is assembling whatever data we already have at the Special Unit.

"In so doing I have made a number of finds, one of which is an uninventoried, beat up box containing R's diary from his Orient trip, poems, essays, et cetera from his youth, and several personal letters and other things."

So, Mrs. Hubbard is aware as early as her response to this, which is February 11, 1980, that Mr. Armstrong has personal letters.

Then he goes on to say:

"The main things will be non Dianetics and Scientology materials. There are numerous such writings and artifacts at SU and more being discovered from time to time."

And then he goes on to say:

"Omar Garrison has been seen about doing the biography and has agreed." He informs Mary Sue Hubbard that, "I have sent my non-existence formula to R and have informed him of what I plan to do in the biography."

Mary Sue writes back on February 11, 1980, exhibit D,

"GO archives in charge doesn't have all possible original manuscripts" -- this is regarding Gerald Armstrong's non-existence formula -- "but

4839

he does have considerable original Scientology and Dianetics Materials. A liaison there would likely be helpful to you."

In exhibit 10 written by Nary Sue Hubbard on December 11, 1979, she indicates that she has knowledge of the fact that the personal possessions are at the Special Unit which Mr. Armstrong has indicated in his prior letters that he is collecting.

She states,

"So you will have to send over or repack with the trunks all personal possessions and things which really do not belong in archives and route back to SU for storage until I can get to it."

The archives that is being referred to is GO WW archives.

This document is written before the new archives post is created by Mr. Armstrong, which is specifically created to collect the documents at SU for purposes of the biography.

So, on December 11, 1979 Mrs. Hubbard knew that these personal possessions were at the Special Unit, and those are the personal possessions that Mr. Armstrong referred to in those prior exhibits.

In exhibit double V Pat Bryce, the personal secretary to L. Ron Hubbard states:

"Mr. Hubbard has given his permission for Gerry to do any research needed to assist the author of the biography and to carry out

4840

these interviews providing that you are agreeable, too."

And that is written "To whom it may concern" with regard to Mr. Armstrong going around and collecting information. On May 7, 1978 Mr. Armstrong writes to the Deputy Commanding Officer of the CMO, personal officer of the projects ops, the personal comm personal office, and the senior personal PRO that he is collecting documents and he specifically states:

"The following files are included in the operating targets."

He is trying to collect from Clearwater from which he is trying to collect documents and he states:

"Pers comm Flag, pers sec Flag, R comma and SO No. 1 Unit."

So here he is writing to the organization on May 7, 1980 pursuant to a particular program collecting documents from all those sources which, as Mr. Armstrong testified, were all sent.

4841

On 14 May, 1980 there was a question raised about the personal nature of some of the documents that Mr. Armstrong was attempting to get from Clearwater. And Mr. Armstrong writes as follows:

"The main thing I need out of SO No. 1 files is any data on family members. These are family who will be contacted for interviews. Per Sec was extremely reluctant to give me data from these files on family members. She felt that it was better that I not see letters between, in this case, Katie and LRH, for instance."

Katie Gillespie is LRH's first daughter.

Subsequently, as testified to by Mr. Armstrong, this was approved. And the materials from these files was sent to him with R's approval.

Then comes the letter which has been in dispute which is dated October 31, 1960 to Mary Sue Hubbard.

Mary Sue Hubbard claims that she never received those documents, even though it is routed on the usual routing form to Controller via Laurel Sullivan, the senior personal PRO who was a personal friend of Mary Sue Hubbard.

Laurel Sullivan testified that she knows that Mary Sue Hubbard received this document.

In that document, even though Mrs. Hubbard claims that she didn't even know there was a raid threat or shredding operation at the special unit, Mr. Armstrong states as follows in his letter to her:

4842

". . .in January there was a raid threat at SU and we all held a shredding party and a great amount of files, old files, were pushed through the paper gobbler. I was then RENOSIC and DCOHUSD.

"Brenda Black, our In-charge and my junior at the time, came to me during the all hands shredding with a beat up cardboard box of old papers which she said had been found previously on the grounds of the SU property."

It goes on,

"It turns out there are diaries from his trip to Asia, some of the poems and personal correspondence from the '30's and '40's.

It goes on to say,

". . .through this old D.C. inventory I did find several more boxes then in the R storage area SU which Mrs. Hubbard, obviously, from prior exhibit in December 11, 1979, knew that the personal belongings were there. These contained R fiction manuscripts, earlier correspondence from various expeditions; Naval records, et cetera."

He states that they were in danger at the SO storage space because it was open to weather and fire and the space at that time was quite open to the elements and was a fire trap. He states,

". . .my rescue of R's personal

4843

records will assist the archives project."

And then throughout this lengthy letter he describes other documents of a personal nature as set forth, for example, on page 4. Then he talks about collecting the documents on page 5 as the historian of the company.

And on page 6 he describes that

". . .I have in my possession some technical originals which should go to Controller Archives, some non-Tech and non-policy materials which would be better in my files."

Again, Your Honor, this would indicate to support Mr. Armstrong's testimony that the technical materials would go into Controller Archives and the personal materials would go into the archives for the biography project. Although Mrs. Hubbard claims that she never received that letter, Your Honor, I submit that in the overall light of the evidence and the demeanor and credibility of Mrs. Hubbard on other items such as the processing files, her testimony is not to be believed.

Again, as set forth in exhibit 11, a document which is dated 6 January, 1980 which the testimony indicates was actually 6 January, 1981, is a CSW to Mary Sue Hubbard which has been approved in her own handwriting,

"Very good. Approved."

In that document Mr. Armstrong states that he -- the CSW states that the documents that Mr. Armstrong, as the LRH senior PPRO researcher has collected include a list of all personal items that were from the special units.

4844

He says,

". . .in addition, I believe many of the items in box one would be invaluable to the work they are presently doing on the LRH biography."

Mrs. Hubbard writes back,

". . .yes, the Controller Archives are to contain the originals of all materials having to do with the administrative Tech and the technical Tech of Dianetics and Scientology. Then we come to the matter of personal materials of the founder which would be of historical interest. There has been no place prior to this where such has been kept except in the areas where he has lived and worked."

Then she talks about D.C. and the U. K. Then she states,

". . .these are currently being gathered up by the LRH Pers Sec PRO Researcher Unit."

That is Mr. Armstrong.

For Mrs. Hubbard to claim that she either didn't know or didn't approve that the documents of the special unit or documents of a historical nature were to go to Mr. Armstrong is refuted by all the documentary evidence.

For Mrs. Hubbard to claim that technical materials were going to be in Controller Archives and personal materials were going to be in Mr. Armstrong's biography project is refuted by the face of that document.

The organization itself on exhibit 7, which was

4845

supposedly ratified by the Board of Directors of the Church of Scientology of California on exhibit 8 which it is stated they ratified exhibit 7, it is provided that Mr. Garrison will be given,

quote, complete access to your archives and records on LRH including FOI documents, private papers, letters, photographs, logs, legal papers, and the like."

4846

I submit, Your Honor, it is obvious since Mr. Hubbard approved this entire project, all of the documents that Mr. Armstrong sought to collect within his own discretion, he had the power to collect.

The executive director 824 which has been marked as exhibit 24 states:

"The purpose of the biography project is to collect all such documentation and to liase with GO for documentation."

Controller archives.

Then he went to exhibit B dated October 10, 1981. Gordon Cook at that time is the controller, Mary Sue Hubbard having been removed. A CSW is sent to the controller in which it is stated,

"Approved. Along with the file cabinets of original Dianetic and Scientology tech, we presently have in the controller archives several trunks of material which are very miscellaneous and includes early LRH Org traffic, old LRH personal items, family letters, his diary as a boy, et cetera."

It further states,

"As an added note, Gerry has been very, very helpful in finding things for the controller archives and turning them over to me."

And then it describes some of the items.

"He already has many, many file cabinets of this type of material, i.e. regarding LRH's

4847

personal life, and I feel this material we have rightfully belongs with him."

And that, as Your Honor knows, was approved after Nary Sue Hubbard was removed and there was another controller in charge. Finally, we cone to the letter of Sheila Gaiman which has been marked as exhibit 25, and in that letter the ground work for the basis of the biography project is set forth. Mrs. Gaiman states that,

"The senior personal PRO office wants to work with you" -- meaning the biographer -- "so that you are able to save time, et cetera, he would box up the materials we have and deliver them to your door. He would make himself available to you to do any research, do any leg work as you wanted."

This is the organization throughout these exhibits authorizing Mr. Armstrong to deliver these to Mr. Garrison's door.

"Regarding the puff profile which you naturally did not want to write, the researcher says he can see where earlier biographical sketches could have led you to the conclusion that that was what was wanted, but those blurbs served a purpose different from that of a real biographical work of the quality this one must achieve. The intention is that you will see all the materials which really show the man." Et cetera, et cetera.

4848

It is clear, Your Honor, that is dated June 16, 1980, it is clear that the basis of the contract as far as Mr. Garrison was concerned and Mr. Armstrong was concerned was that all personal materials of L. Ron Hubbard were to be collected up and given to Omar Garrison.

We come to the period and I recognize that this is somewhat of a laborious task. Your Honor, but I believe that these exhibit references and the specific portions I read from these exhibits with regard to setting the record and correlating the documentary evidence to the defense of this case will be established.

We come to the period in the late summer and fall of 1981 which the plaintiff and the intervenor take the position reflects Mr. Armstrong's state of mind that was building at that time to attack Mr. Hubbard.

I submit, Your Honor, that the perspective of all of the exhibits that are under seal, as understood by Mr. Armstrong; namely, the misrepresentations, together with his efforts within the organization to correct those misrepresentations based upon the basis of the contract is set forth in a series of letters that Mr. Armstrong wrote between the summer of 1981 and the time he left.

4849

The first such letter is 18 June, 1981 marked as exhibit 111 in which Mr. Armstrong sets forth in a five-page letter the inaccuracies in some of the biographical references to Mr. Hubbard.

Mr. Litt says that this is nit-picking. But it was Mr. Armstrong's job to find the facts as the researcher.

In fact, Mr. Young was put on the witness stand to nit-pick about the fact that there was some reference to a Commander Snake Thompson.

So he went off and tried to find Snake Thompson. It was Mr. Armstrong's job to point these facts out. As the testimony shows, he pointed them out to Mr. Garrison. And here he is pointing them out to the organization as early as the summer of 1981.

On 1 September, 1981, exhibit ZZZ, Mr. Armstrong writes another letter, this time to Barbara DeCelle with regard to the misrepresentations of Mr. Hubbard's background.

He goes on with 41 items in which they are either not documented, they are just grossly false, unverified, or they represent hyperbole.

Once again, Mr. Armstrong is seeking to have the lies corrected.

Finally, on exhibit II, a letter to Cirrus Slevin, this is regarding Norman's report on the biography research, "Norman" being Norman Starky. And Norman Starky is questioning the facts that Mr. Armstrong is raising. And

4850

Mr. Armstrong responds as follows:

"C of S published biographical sketches, copyrighted in LRH's name, have in the past contained a number of easily disprovable claims. These things have been disproved and shot at by various enemies at various times."

He goes on,

"I have attached what is in fact a false report correction on some of our claims prepared by an enemy researcher, Michael Lynn Shannon. Much of Shannon's material is accurate. The slant he gives the material is entheta. My emphasis, and I think the emphasis we all must give to the handling of LRK's biographical material is accuracy with a theta slant."

He goes on,

"If we present inaccuracies, hyperbole or down right lies as truth or fact, it doesn't matter what slant we give them. If disproved, the man will look to outsiders, at least, like a charlatan. This is what I have been trying to prevent and what I have been working on the past year and a half."

He says on page 2,

", . .even in our system it would be severely dealt with if someone pretended certification. . . ."

Then he runs through some of the misrepresentations that he has found and he says on page 4,

"It is not logical that I should be targeted for digging

4851

up the facts. LRH always has a good reason for doing what he does. So where there are untruths or contrary facts, we'll someday, when there's a line on him, have to ask him. For now, we can't go on making up stories to cover up undocumented facts, untruths, or contrary facts."

4852

I submit, Your Honor, that those letters written at that time reflect Mr. Armstrong's state of mind with regard to trying to correct the misrepresentations. At the same time, as reflected in exhibit double H, Jocelyn Armstrong has been asked to do illegal -- what Mr. Armstrong perceived to be illegal acts, so Mr. Armstrong writes a letter to the commanding officer of the CMO in which he states:

"The situation is that my wife Joyce is very distraught because she is being asked or ordered to do illegal actions, and other actions which she is not sure of as their legality or future ramifications. One of the actions is to get mission holders and board members to sign various documents; proxies, board minutes, et cetera. She has already had several people sign these. They were backdated documents, that they were signed in 1981 but dated as if the signing took place in some other year e.g. 1975. This is fraudulent and illegal. She has not been sleeping well or eating well because of her continuous anxiety. She has had nightmares recently which she never had previously."

That is dated October 23, 1981. That is the letter which the plaintiff and the lntervenor claim indicates that Mr. Armstrong did not want to or tried to avoid in the past illegal activity, despite all the shore stories that he had been caught up in.

4853

I submit, Your Honor, that there is a very simple, common sense explanation for the mind of Gerald Armstrong at the time. He was uncovering the truth in these documents. He was writing to organization telling them that the truth has got to be used and the lies corrected. He was telling them that his wife was not going to participate in illegal activities.

His state of mind may have been that he had fought inside the organization throughout the period of time, as he testified he was in a state of fear against such conduct. He was ordered and drilled to do the shore story. He was involved in an organization and caught up with a group of people in which everyone pursued the shore story.

The individual conscience in that climate gets suppressed, and that is the danger to society. That is the fight that Mr. Armstrong was fighting inside himself.

The lies that were being perpetrated by the organization, the shore stories that were being perpetrated by the organization, and his inner fight in the face of the documents he was collecting to get away from that type of conduct.

I submit, Your Honor, that the record as a whole clearly reflects that evolution in Mr. Armstrong's thinking.

It may be very difficult for the court to understand how someone in an organization such as the Church of Scientology or working for L. Ron Hubbard could revere

4854

this Individual for so many years in the light of what the evidence clearly indicates are false representations about him, but throughout those years Mr. Armstrong didn't know that.

He learned that shocking lie that he had been involved in an organization for some 10 years promoting L. Ron Hubbard, doing everything he was ordered to do in the belief that L. Ron Hubbard represented something.

His life was shattered when he began to uncover these lies. He began to try to sort things out within the organization, and he was attacked as a result of it. He was ordered into a security check by Norman Starky. He knew what a security check entailed as he testified to at length and as I previously explained in the summation.

At the same time, in December 1981, as reflected in exhibit double M, Mr. Armstrong is asked, even as he is protesting the lies and seeking to protect them, to sign the declaration of religious commitment [commitment] and application for active participation on church staff in which he is going, to state:

"I recognize and understand that neither Ron nor Mary Sue Hubbard receive any compensation or remuneration from training or processing by the church. That neither Ron nor Mary Sue Hubbard are officers or directors of the church, and that neither of them are in any manner responsible for actions of the church."

Then he is asked to give a release to the

4855

Hubbards.

I submit, Your Honor, that in light of all the evidence the court heard in this case, to require Mr. Armstrong at this point, after he has seen these documents to sign such a document, indicates the perpetuation of the lies.

4856

Mr. Armstrong writes on 12 December 1980 [1981] to Barbara DeCelle, "I would wish" -- this is his letter of resignation --

"I would wish that my family not be contacted. I frankly don't know where I'll go right now. But will be in touch with them in the near future. It would be a bit distressing for them and they have not all been pro-Scientology over the years.

"I would also ask that I not be harassed. I know the organization is very capable of that sort of thing, but I don't wish them any ill will and I would hope that they will not intend any toward me."

Mr. Armstrong states,

". . .I spent the last several months trying to get Omar a copy of all the materials he would need and more stuff kept pouring in. Omar has a great deal of materials, but there will be holes which will have to be filled."

I submit, Your Honor, does that indicate an intention to deceive the organization about the materials that have been given to Omar Garrison? He is telling them in writing that he is copying all of the materials and trying to fulfill his part of the agreement with L. Ron Hubbard.

THE COURT: Well, maybe we'll take a 15-minute recess. Are you going to finish this afternoon, Mr. Flynn?

4857

MR. FLYNN: I have about perhaps 20 more minutes, Your Honor.

(Recess.)

4858

THE COURT: We are back in session.

You may continue, Mr. Flynn.

MR. FLYNN: I'll try to summarize as quickly as I can. I recognize that going through all of those exhibits is extremely laborious, but I do think that in a jury-waived case, I do think it was necessary to give the Court an indication just of the documents that were produced to Mr. Armstrong. And I submit that the weekly reports that Laurel Sullivan testified about which have never been produced would even greatly intensify the strength of the record as to the fact that Mr. Armstrong was always working on this project on the personal orders of L. Ron Hubbard; collecting documents from throughout the organization and that it was recognized that the documents belonged to L. Ron Hubbard.

And I refer the Court specifically to exhibit EE and exhibit FF, the two letters of Alan Wertheimer who was acting as Mr. Hubbard's counsel.

Exhibit EE dated November 17, 1980 states,

". . .since Mr. Hubbard's personal records and his authorization of Mr. Garrison's endeavors are vital to the success of this project and since Mr. Hubbard's personal services will be necessary to locate, sort through, compile, and identify thousands and thousands of documents, photographs, and memorabilia, hereafter the archives, we should agree on fair and equitable means of compensating Mr. Hubbard for his contributions

4859

to the biography."

Well, as Your Honor knows from the evidence, Mr. Hubbard is in hiding.

4860

Well, as Your Honor knows from the evidence, Mr. Hubbard is in hiding. [sic] The person who did all this for two years was Gerald Armstrong. The person who did the locating, sorting through, compiling, et cetera of L. Ron Hubbard's personal records was Gerald Armstrong, and Mr. Wertheimer, as Mr. Hubbard's lawyer, was seeking a fair and equitable means of compensating Mr. Hubbard for Mr. Armstrong's work.

In fact, Mr. Wertheimer recognizes,

"While Mr. Hubbard may be willing to waive an up-front payment or advance, he must be reimbursed for his out-of-pocket expenses in connection with the compilation of the archives, including without limitation salaries paid to employees hired by him in connection with said compilation."

That was Gerald Armstrong.

Laurel Sullivan testified that that was what was being sorted out in the MCCS mission, and when Mr. Armstrong inquired in July 1981 as to what his status was. Laurel Sullivan said, putting down he was an employee of CSC was just a temporary shore duty until they figured out what would occur.

Well, as Your Honor knows, what occurred is they created ASI, a for profit corporation, and the people who were doing work for Mr. Hubbard, such as Mr. Schomer, Mr. Spurlock, Terri Gamboa, they went to work for for profit corporations and again receiving what they thought was at least the minimum wage.

Mr. Armstrong was working clearly for

4861

Mr. Hubbard, Mr. Hubbard's benefit, to compile Mr. Hubbard's archives for Mr. Hubbard's book, for which Mr. Hubbard was going to be paid 50 percent of the net proceeds of publication, together with five percent of the royalties while Mr. Armstrong was working for $20 per day [week].

In exhibit double F, Mr. Wertheimer states that,

"Mr. Hubbard has ownership and possession of the archives."

That is Mr. Hubbard's agent, Mr. Armstrong. This letter is written to PDK. The letter does not state that the Church of Scientology, Mary Sue Hubbard, any of the numerous corporate entities that Mr. Hubbard erected around him had possession of the archives. It says that he has possession.

That is what this case is about. Your Honor. It is about who had the right to possess at various points in time on a contract which, even if the exhibits indicate was entered into with this PDK corporation, which didn't even know supposedly of the existence of the contract. That I submit can result in an inference by the court that the contract was between L. Ron Hubbard, L. Ron Hubbard and L. Ron Hubbard.

It was only about money for him in the compilation of the archives for him, for which he was going to take a tax deduction. Mr. Armstrong did all that work. In effect, Mr. Garrison discovered that that contract, like all the other documents regarding Mr. Hubbard, was a sham.

4862

He couldn't even receive his moneys from PDK because PDK is a GO front organization which supposedly, as it indicated, did not know about the contract.

The overwhelming amount of evidence in the case with regard to the way the organization was run as testified to by Kima Douglas, particularly with regard to stacks of money in cash in Swiss bank accounts, Mary Sue Hubbard testifying that 10 million in cash was brought on board the ship, stacks of cash in Swiss bank accounts owned and controlled by L. Ron Hubbard.

He sent Kima Douglas to stack it there.

All of the evidence with regard to all of the shore stories, all of the evidence with regard to the Commodore's Messenger's organization, the command lines, the domination of these organizations by Mr. Hubbard on every phase.

4863

And then a resulting biography which, in itself, as indicated by their own records, is a sham, warrants the invocation of the doctrine of ruling that Mr. Hubbard is the alter ego of the corporation or piercing the corporate veil for the very simple equitable reason as set forth in the case law that a court sitting in equity should pierce the corporate veil to prevent a manifest injustice, to prevent unfairness, to prevent fraud.

The fraud in this case is two-fold: It involves, one, the continued perpetuation of these lies through another biography in the future about Mr. Hubbard.

Vaughn Young got on the witness stand and told this Court that -- which I submit was highly misleading -- that they were still uncovering items and they were still working on it. And I submit to the Court he has been working on it for three years, seven days a week.

Mr. Young, trying to perpetuate the myths of Mr. Hubbard's Naval career by bringing in, for example, Captain Moulton is an indication of this organization's intentions; the settlement with Omar Garrison, the secret settlement and the payment of unknown amounts of money to Omar Garrison and the return by Mr. Garrison of the documents was done to damage public interest in the case. It was done to prevent people from knowing what is in these documents. That is why the settlement was entered into with Mr. Garrison because Mr. Garrison was going to write the truth. He said that he was going to write it based on the Constitution of the United States.

4864

If these documents are suppressed, then the truth will not be revealed and the organization and Mr. Hubbard will be using the Court -- and there are all kinds of legal machinations that can be created as to Mary Sue Hubbard's right to possess, as to the Church of Scientology of California's right to possess -- in fact, the assignee of the contract is New Era Publications, which isn't a party.

Many of the documents are in the possession of the Church of Spiritual Technology.

Mary Sue Hubbard didn't know what the Church of Spiritual Technology was doing with the documents.

One of the witnesses for the plaintiffs testified that his supervisor of archives, Mr. Vorm was a Fred Pilvilski and that his supervisor was Lyman Spurlock of Author Services Inc. That is L. Ron Hubbard. That is the entity that is controlling these archives.

The right to possess in Mary Sue Hubbard or the Church of Scientology of California is a myth.

Andrew Lenarsic said they had the right to possess all of the documents.

Mary Sue Hubbard came forward and said she had the right to possess them; in fact, Mary Sue Hubbard hasn't possessed them since L. Ron Hubbard authorized Mr. Armstrong to possess them and Omar Garrison. And the right to possess in Omar Garrison didn't change until, as Your Honor knows, the summer of 1983. And at that time all of these documents were in court.

So I submit, Your Honor, by almost any theory --

4865

and there have been -- I would refer the Court to our trial brief which sets forth at length our legal theories of this case.

By any theory, for Mary Sue Hubbard and the Church to now come in and claim they have a right to possess when throughout this project it was clear that L. Ron Hubbard was going to get the money, that they were L. Ron Hubbard's personal records, it was L. Ron Hubbard's contract; it was for the benefit of L. Ron Hubbard that Gerald Armstrong was doing this work. It would be severely inequitable.

The issue with regard to the use of the documents by Mr. Armstrong after he left the organization is a very simple picture.

A young man joins a cult that is run as the personal organization, quote, unquote, of L. Ron Hubbard.

4866

He works in it for some 10 years for L. Ron Hubbard pursuant to all the shore stories.

L. Ron Hubbard assigns him to the biography project to collect all these materials for L. Ron Hubbard's benefit, for L. Ron Hubbard's biography.

He finds that L. Ron Hubbard has totally falsified his background, that L. Ron Hubbard has got a guardian's office through his wife that goes out and does all those things I have already talked about which he knows about.

He leaves the organization, writes a letter. Says, "I don't want to be harassed. Leave me alone."

In fact, he leaves them. Tries to put it behind him. Has no money. Attempts to sell some photographs, and the entire weight of this organization descends upon him, including $91,000 in private investigators' fees from donations of church members who also believe these representations.

The use of the documents after the April 22nd Declare which Mr. Armstrong was accused of all those things was simply one, he went to a lawyer to defend himself; two, there was a meeting of the principals involved in this case who owned the other photographs. The documents were reviewed and then the documents were filed in court.

The only other evidence before this court is that an affidavit was created by Mr. Armstrong to file in court with regard to the contents of the MCCS tapes for which they are not claiming damages and which also recite the Helen O'Brien letter about using the religion

4867

angle.

I must admit. Your Honor, if this court were to rule that the use of documents for an exposition of the truth in a legal proceeding was a misuse of documents in this context, that also would be severely inequitable.

The documents were used in other courts, and there is only one document, the Helen O'Brien letter, which is in Mr. Armstrong's affidavit for which they could claim any documents, and that relates to what almost amounts to a fraud on its face with regard to the religious angle.

I submit in light of the fact that this organization destroyed the photographs, which are also the subject of this lawsuit, the organization has a fair game doctrine, the organization does have forced promissory notes, does have forced lockups, does cull PC folders, does have security checks of the type the court has heard, all of which were designed to intimidate people like Mr. Armstrong, for him simply when he found out that he's been issued this declare, accused of theft and defamation, to hire a lawyer, turn the documents over to the lawyer and then have the case litigated in court, for the plaintiff and the intervenor in light of the conduct that this court has heard that they have been involved in, to come in and claim that Mary Sue Hubbard has been mentally raped or that the documents have been misused is fanciful.

If that were the case, if a conversion could take place by an individual in Mr. Armstrong's position who was working with Omar Garrison to simply hire a lawyer,

4868

say, "Here, you take the documents and tell me my rights," and then for the documents to be filed in court, to constitute a conversion or an invasion of privacy or a breach of fiduciary duty, and we have already submitted the law to the court that we relied on with regard to all those items, again, would be an injustice.

4869

I submit to the Court it is clear what should be done with these documents.

The originals should be returned to L. Ron Hubbard if L. Ron Hubbard wants them. And if he wants them, he should come in and ask for them.

Copies of all of the documents should be preserved as accurate copies of the originals for purposes of the completion of this litigation and for those documents, in my personal view, which I submit to the Court, is that all the documents, given the nature of the conduct Mary Sue Hubbard has engaged in, even the affirmations which are obviously of a sensitive nature, all of those copies of those documents should be released to the public.

Parents of children out there who are getting involved in this organization, some 1,000 of which I have dealt with in the last five years, people who have been ripped off financially, people who want to know the truth about L. Ron Hubbard, they are the ones who should see and bear the fruits of what Mr. Armstrong has tried to do, not only inside the organization, but through nine weeks of this trial and two years of litigation defending himself against this organization.

If Mr. Hubbard wants his originals, he should come in and ask for them. The copies should be maintained in court, those that the Court deems appropriate, copies of which the Court deems appropriate should be put in the public arena.

And to assess damages against Mr. Armstrong in

4870

light of what he has been through to tell the truth, to reveal the truth, to come into this court and litigate what is in these documents, would be a severe injustice.

Thank you, Your Honor.

THE COURT: Mr. Litt.

MR. HARRIS: May we go out of order, Your Honor, and let me? Because I am not going to be here Monday.

THE COURT: Okay.

MR. FLYNN: Neither will I, Your Honor.

MR. HARRIS: Mr. Flynn talks about the meeting in the Bonaventure as though it were an attorney-client meeting between all of these victims in respect of the photographs.

Why, Your Honor ought to ask, is 20-20 there?

This is not an attorney-client meeting. It is clear, Your Honor, at the time that Mr. Armstrong went off and took the documents in this case he, in effect, made the Church the victim of what he claims Fair Game is.

The Church was tricked by his perfidious giving of internal memoranda of the Church having to do with the contract negotiations with Omar Garrison to Omar Garrison.

The Church was tricked by him sending 50,000 documents to Mr. Garrison in the state of mind that the biography would never be written.

He sold the property of the Church to give to the Church's main attacker, Mr. Flynn.

He attempts to destroy by attacking and accuses the Church of doing that.

The very things he accuses the Church of doing

4871

allegedly pursuant to this Fair Game, he does.

Let's take, for example, the PC folder data. All of the witnesses that were here -- we can run then down -- Mr. Armstrong; he claimed that PC data -- PC folder data was used against him. And what did he say? That I used the success story. That is nonsense.

Joyce Armstrong didn't say anything about any PC data being used against her.

Nancy Dincalci said she signed something of crimes, but she didn't testify that anything was used against her.

And Mr. Flynn characterized it as blackmail. But nobody testified that they had been blackmailed, threatened, or otherwise.

Mr. Flynn, however, put in that Donna Reeve culled PC folder data. She didn't even know about it. And it certainly hadn't been used against her.

Mr. Armstrong shows to his friends and sends to Michael Flynn the affirmations which is a rudimentary item like a PC folder. The very private things that one discloses in session, Mr. Armstrong wants to expose to the world and so does Mr. Flynn.

Laurel routed out. And she didn't claim to have signed anything of crimes. And she certainly [didn't] indicate that anybody tried to use any PC folder data against her. And, of course, she did claim some Fair Game with Kevin True coming up and Mr. Litt trying to get ahold of her.

The lies. Apparently, not only had the Church

4872

been lied to; this man lived a deception for at least two months; lived: a deception trying to deceive the Church that he was still with the Church when he fact he wasn't.

He told Vaughn Young, even when he came back to pick up his financial records which he claims the Church would keep, that he didn't have this very private letter of Mrs. Hubbard's, but he did.

4873

So he lied to Mr. Young. The essence of Mr. Armstrong's testimony in this court; black propaganda, the thing he accuses the church of, he does. He exposes the dirt. That is his game. That is his attack.

Homer Schomer, who was here, Mr. Flynn talked about the photos, said somehow or another that Terri Gamboa lied. Homer Schomer claims to have seen the album, the very album that Mr. Armstrong admits and Miss Gamboa admits Mr. Armstrong got from Virgil Wilhite, his property. Homer Schomer claims to have seen that on Terri Gamboa's desk after the event at the CMO. That is after the time when Mr. Armstrong became maniacal at CMO, attacking Mr. Hubbard, refusing to leave. The lies of Mr. Armstrong ought to be examined now that Mr. Flynn has attempted to point out misrepresentation after misrepresentation.

He said he was scrupulously legal while he was in the church, and that is in that letter to Gale. Now he claims that he stole materials while he was in the church. He smuggled materials while he was in the church and lied to officials.

He said, Your Honor, that he volunteered to do exhibit 48, which is an affidavit signed under oath when he saw a newspaper article in the Clearwater newspaper.

That affidavit states right off the bat,

"I am a member of the Church of Scientology of California and am employed by this church."

Nowv, he claims he is not employed the church at all. He is employed by L. Ron Hubbard personally.

4874

The second paragraph of that affidavit under oath,

"That from July 1976 to December 1977 I was working in a section of the church known as the Rehabilitation Project Force at the Church of Scientology of California located in Clearwater, Florida."

Now he tells the court he was employed personally by L. Ron Hubbard at all times. He says now before this court under oath that the E meter is a lie detector. In his affidavit exhibit 48 signed under oath he says,

"I personally know that the E meter is not a lie detector but is a religious artifact designed to be used as an aid in spiritual counseling, auditing,"

which it is. Is he lying to Your Honor? Is he lying in the affidavit?

He said exhibit 48 was reviewed by him at the time and was found to be written without error in a deposition in this case, but now he claims it had errors and was signed anyway.

He said as to exhibit 73, another affidavit by Mr. Armstrong under oath, that Ann Rosenbloom was responsible for the list 1 rock slam project, but now claims L. Ron Hubbard was.

He now claims that exhibits 48 and 73 contain lies and perversions under oath.

Well, lies and perversions under oath; lies and perversions under oath.

4875

He admitted he lied to his parents frequently. He admitted that he lied to the INS.

He told Cirrus Slaven that his post was secure and he wrote Sue Anderson that Norman Starky's request for a sec check on him was a simple matter that was now handled, but now he claims that this put him in terror and he decided to leave.

He lied to John Peterson, the attorney who wrote him a letter. He writes a letter back and says, Oh, no, all the materials were left with Omar Garrison or in the archives the very same time that he was giving them to Mr. Flynn. He claims now a great many of the Guardian's office and even purported to tell Your Honor this code that was on the CIC thing, something about E being enemy and treason and he had some wild stories.

4876

"I" turned out to be an enemy on another document. That just can't be so.

Mr. Armstrong is claiming knowledge that he doesn't have.

Misrepresentations.

He told Tom Vorm that MSH's letters would be kept confidential, background data. And then he showed them, indeed, a private such letter, to Nancy Dincalci, to Michael Flynn, and perhaps to others.

He claims he left because of biography inaccuracies; that he believed the organization would never change; yet, one, the organization did change. And, two, he wrote in one of the memoranda,

". . .it is even okay if the author lies as long as he knows he is lying."

He claims to have done a thorough research job. But it is clear, based upon the data that he had, he simply put the things together and he put them together in such a way so as to make it appear that L. Ron Hubbard was a fraud.

Now, some of the items in there are absolutely inconsistent. And I see that; however, much needed to be done, Mr. Armstrong didn't do that.

He claims now to this Court a search for truth when in fact what appears before the Court is lies, lies about his being employed by L. Ron Hubbard personally. The record is replete with them; when he said he joined the Sea Org he felt he was working for L. Ron Hubbard but somehow he got closer when he moved to the Household Unit and now was personally employed.

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Now, Mr. Flynn claims there was some kind of contract between Mr. Armstrong and L. Ron Hubbard. 'Tai'nt so.

Mr. Armstrong, by the way, was not forced to sign either of these affidavits where he talked about what auditing was and what the RPF was. He volunteered to do it. He got -- he passed on the information to the person who wrote it up. He had a chance to review it and he signed it and he signed it under oath, absolutely inconsistent with what he said here.

Mr. Armstrong feels that his version of Fair Game is okay to run on the Church, attack, attack, attack. And that is what he is doing.

Now, he, when we get right down to it, claims that he was a victim of Fair Game.

Let's look at what his true victimization was.

The Church hired some private investigators to try to find him. The private investigators formulated a plan so as not to harass him; indeed, to stay in an undercover capacity to watch him.

This man, who claims that he was in fear the entire time, runs out three times during the course of this surveillance; on one occasion he threatens the person in the car; he sticks his foot under the tire and threatens to lay down in front of the car.

This is not the activity of a man in fear. This is the irrational fear that caused him to run into the CMO that Mr. Flynn talks about and curse L. Ron Hubbard and all

4878

the people there.

This is not fear. People in fear do not do that. They don't run up to a private investigator in his car, stick their foot under the wheel and then threaten to lay down under the car if he tries to get away from him.

He also chased after twice these private investigators when they were just trying to surveil him to find out where the documents are. He runs after them.

Where is the Fair Game here? Where is the fear? Nonsense.

Indeed, Mr. Armstrong felt that the Costa Mesa Police Department and the Los Angeles Police Department were also harassing him on behalf of the Church of Scientology. That is the Fair Game that Mr. Armstrong wants Your Honor to believe that he was subjected to.

He was subjected to no such thing. He was the aggressor; he was the attacker, even of the private investigators. Now, that is not a man in fear.

Black Propaganda, Mr. Flynn put the exhibits in. I believe it is exhibit BBB, the policy letter. The missing ingredients are ingredients which is PR series two:

". . .indicates that older PR practitioners preferred lies. They used circus exaggeration or Black Propaganda. They sought to startle or intrigue. And the easiest way to do it was with exclamation point facts which were in fact lies."

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On the next page Mr. Hubbard states, ". . .never use lies in PR."

This is the Black PR that Mr. Armstrong is now subjecting the Church to.

Not one good thing was said about Mr. Hubbard by Mr. Armstrong in all of that time that he was on the stand. Surely, Your Honor, Mr. Hubbard cannot be the total embodiment of evil that this man claims.

Mr. Hubbard was -- at least Kima Douglas recognized him as a genius. Surely, he must have been worth some money if he was able to manage everything every day all the time of every Scientology organization all over the world.

Mr. Armstrong, however, taking fragmentary documents from the Controller's Archives such as HEC records and the like, concluded with [without] researching any further, which is his modus operandi, that massive amounts of money went to L. Ron Hubbard; yet, within the very files that Mr. Flynn points out to Your Honor, there is a charter agreement between the Church of Scientology of California, HEC and the founder, PL, the one Mr. Armstrong made great hay over the course of his time on the stand, Mr. Hubbard states,

". . .there are considerable outstanding sums loaned by me to Orgs or owed to me by Orgs. And those should be paid as feasible, carrying me as creditor in dispersement files."

Mr. Armstrong didn't bother to look to see if

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Mr. Hubbard had ever again become a director of any Scientology corporations. Had he done so, he would have known that he didn't.

4881

Mr. Armstrong did not talk to the people who were around at the time who could explain HEC and what it was and why it was necessary for the survival of Scientology to go off on a ship out of Southampton and go down to the Mediterranean where Gerry, as ship's rep, encountered the very difficulties that he now denies.

He is off into the ports trying to make it safe for the Apollo.

Kima Douglas talked about that. Wally Burgess talked about that. How they were kicked out of Corfu and couldn't be openly Scientologists.

Of course there was a shore story, and the shore story was necessary in the opinion of the people aboard that ship for the survival of Scientology and, by God, it worked. It is here to day.

Now, Mr. Armstrong says, "Oh, there is no trouble." But he wasn't at Corfu.

He does know about the so-called rock festival that occurred in Portugal in 1974, but obviously that doesn't indicate anything at all. He himself was arrested, much like Kima Douglas, and interrogated about drugs which he had no drugs by his testimony, why was that? Well, it is a mystery.

Mr. Armstrong says nothing about the people, all of the people who were in Scientology, who believe in the religion, who believe that it works, who are off of drugs and those sorts of things.

Now, Mr. Armstrong cannot speak well of the

4882

founder. He cannot speak well of the religion because he refuses to this day to realize that he is on the attack, the very thing that he claims the church is doing to him.

So, what is it? By May the church had hired some private investigators to take a look to see if they could locate Mr. Armstrong.

In deposition and indeed in a request to admit, he admitted he didn't realize that the private investigators were around until way after May, certainly after time he sent those documents to Mr. Flynn.

He said that internally within the documents that he saw that there were various things said at various times.

Your Honor, I would hate for my life or indeed anybody's life to be subjected to this sort of analysis by somebody in the frame of mind of Mr. Armstrong. We all of us change over time, we all of us regret things that we have done. Mr. Armstrong did not have the humanity to understand that, to believe it because he wanted to attack.

Now, 60 days of a man's life is represented among those documents, 60 years during which he founded the religion of Scientology, the seminal bases of Scientology were developed back in the time when Mr. Hubbard was writing what was a psychology book, "Dianetics."

Mr. Armstrong knows that Dianetics became encompassed in Scientology because there was something that was beyond the mind.

4883

Mr. Armstrong stated that Mr. Bennett told him what it was, and that was the thing.

Mr. Flynn has launched an all out attack upon the religion of Scientology. The First Amendment does not permit that sort of thing. This religious fraud concept is unique to Mr. Flynn who calls this religion a cult, even talked about Jim Jones. Jim Jones, Mr. Flynn talked about.

Thousands of people have come to see him. He is the church's chief attacker.

If there were really fair game, Your Honor, Mr. Flynn would not be here. I mean, tricked, lied to, destroyed, Mr. Flynn wouldn't be here because he is the chief attacker.

Now it is not true that there is this fair game doctrine. Mr. Flynn sits here. Mr. Armstrong sits here.

We had this Mr. Walters get up and talk about some assassination plot on Paulette Cooper. She was down at Clearwater with Mr. Walters.

There was a claim by Mr. Armstrong that Miss Sullivan told him about some kind of a plot on Lorna Levitt, yet immediately before Mr. Flynn comes down to the Bonaventure Hotel, he is up representing Lorna Levitt. She is still around.

This claim based upon colorful language is nonsense. Mr. Armstrong understands it. Mr. Armstrong is running it for a different reason, and that is the counterclaim

4884

that he's got pending.

So, insofar as the idea that the documents should be somehow immunized from their privacy, that somehow because Mr. Hubbard and Mrs. Hubbard and somehow the Church of Scientology are public figures, that one has a right to steal from them, attack them and destroy their privacy. That is not the law.

This man was under an obligation to do with the documents a certain thing which would preserve their privacy.

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He now wants to expose it, not for his own defense, but so that Mr. Flynn can use it in other cases. He admitted it.

Sure, it will help his defense too. But the defense is not the defense. It is the counter-claim that is still down the road. Mr. Armstrong sits before you afraid to admit what he was, a dedicated Scientologist who believed in what he was doing at the time. He found feet of clay. He found feet of clay in the documents that he took, 60 years of a man's life. And from that concluded that he should attack with the very documents that he had a trusted fiduciary relationship with; that is perfidity. It is treason and it is betrayal.

And I submit, Your Honor, that it ought not to be treated lightly merely because Mr. Armstrong now gets up and tells Your Honor he was in fear the whole time and there is this alleged Fair Game, which there isn't or he wouldn't be around or Mr. Flynn. He has run his own Fair Game on us.

Six months from now, Your Honor, you are going to see the unauthorized biography of L. Ron Hubbard, copyright Michael Flynn, Gerald Armstrong, Laurel Sullivan.

Oscar Wilde said, "All great men have their disciples. But Judas writes their biographies."

And that is what is going to happen and that is my prediction.

Thank you, very much.

THE COURT: Mr. Litt.

4886

MR. LITT: Your Honor, let me begin, if I may, just to address some of the particular points that Mr. Flynn discussed.

Mr. Flynn raises Guardian Order Program 121669. That is the one that refers to looking at processing folders.

We should be clear on what Mrs. Hubbard's testimony was. Her testimony was that when she wrote that she was not referring to pre-clear folders. Her testimony was that had nothing to do with what in fact happened; in fact, when she was shown these things, she had never seen them before. And she said she didn't have any knowledge of it.

But Mr. Flynn says that this document authorized doing that.

Now, the word "processing" means auditing. That is in the dictionary. But I didn't note any definition of processing folder. If the Court looks at these documents that Mr. Flynn launches around that have never been exposed publicly except by him, one will see that the phrase used consistently is "PC folder."

And Mrs. Hubbard said -- the Court in fact, asked her the question, "Aren't you responsible anyway because, after all, that was your area?"

And she said, "Yes."

So in that sense, yes. But if the question is what did she intend, then she did not intend to tell people to use pre-clear folders. She was referring to files kept

4887

by the director of processing at that time that was separate from pre-clear folders.

Mr. Young confirmed it. Perhaps it changed. But to the extent that the issue is Mrs. Hubbard's intent which, frankly, in the context of this case I am not sure why we end up addressing it, but we have; all that Mrs. Hubbard said was, "I was not saying that that is what people should do," and there is no evidence to contravene that.

4888

Mr. Flynn says how can Mrs. Hubbard make a claim of mental rape with all of the things that she has purportedly done. Well, let me turn the question around.

Since Mrs. Hubbard's conviction has clearly permeated in certain respects this case, Mrs. Hubbard was convicted and Mrs. Hubbard paid her price to society for the wrong that she did.

Imagine Mrs. Hubbard's feelings that Mr. Armstrong can steal documents from her, can trample on her privacy, can trample on her husband's privacy, but he can say, he can say, "It is all right for me to do it because I am doing it to you."

Mary Sue Hubbard can't say that. No, she goes to jail when she commits a wrong, but Mr. Armstrong can say, "When I do this to you, you are immune from the law."

THE COURT: Well, Counsel, I think you are getting a little rhetorical here. If she had a feeling there was a crime committed, she can go to law enforcement and seek law enforcement.

You are talking about civil litigation. She didn't go to jail for civil wrong. She went to prison because she committed a federal crime.

MR. LITT: That is true. Your Honor, and she paid her price to society.

What I am getting at here is that she feels, and I think the evidence supports that, that she has been wronged and from her point of view, the fact that that

4889

wrong can be okayed because of something in Mr. Armstrong's mind that never happened to him, given the fact that she has to be responsible for her own wrong, I am simply trying to give the court an understanding from her perspective of how she would view it.

Mr. Flynn made an issue and spent a great deal of time about whether or not Mrs. Hubbard knew of Mr. Armstrong's activities.

Now, I don't want to spend a lot of time on that issue. Mrs. Hubbard testified that she was not aware that he had gone into her storage. Special Unit is not R Storage. Special Unit is Gilman Hot Springs, all kinds of things at special unit.

The point is really a minor one in the context of this case because the issue really isn't Mr. Armstrong gathering them up. He is not being sued for having gathered them up while he was holding church post. The claim is what he did after he left that church post. That is what the case is about, and that is where the wrong occurs, but I know that there is no acknowledgement and no acknowledgement has been located that Mrs. Hubbard, in fact, responded to this October 15th letter which seems to be the main basis of claiming that she knew about it, but as I say, it doesn't make any difference whether she knew about it. She testified in asking what she is claiming and she said,

"My claim for damages is that Mr. Armstrong took the documents after he was out of the church and gave them to Michael Flynn.["]

That claim is irrespective of what she knew

4890

about what he did because Mr. Armstrong testified that they were only given to him for other reasons.

Now, Mr. Flynn spent some time going through the claim that Mr. Armstrong had simply given these materials to his lawyer.

The facts are, the admitted fact, the binding fact is that they were given to Mr. Flynn for use in other cases.

The Bonaventure meeting has people there who were not Mr. Flynn's clients. It has press there. It has other people there who were not involved in this photo incident, according to the testimony of Mr. Armstrong, himself.

There is a claim that gets collapsed in time that Mr. Armstrong was responding to the private investigators. Your Honor, the testimony concerning the private investigators begins with an incident on August 21st. This case was filed August 3rd. Mr. Armstrong's deposition was taken August 17th and 18th, and all the documents had been sent before anything having to do with the private investigators.

They have nothing to do with Mr. Armstrong's sending the documents.

Mr. Armstrong testified that he tried to return Mrs. Hubbard's letter.

The court has the envelope in evidence. The court should take a look at the postmark on that envelope, August 14, 11 days after the suit was filed, a convenient timing for this great concern to return Mrs. Hubbard's letter.

Now, Mr. Flynn talked about Mr. Armstrong's

4891

state of mind while he was still in the church and how he was trying to correct things, but when one analyses the documents, you see that he is saying this when he is already plotting to leave, so that his statement that he just wants to see things corrected, which by the way the main biography being worked on he doesn't even claim has any inaccuracies by his standards, he is not trying to correct things.

He is trying to make sure that he gets these documents out of the church. That is what the evidence shows.

Now, Mr. Flynn spent considerable time discussing the purported misrepresentations, and again he makes generalizations about them, and he translates what the court admitted as to Mr. Armstrong's state of mind in his argument. He translates them into fact, into purported fact.

Well, the fact is that Mr. Armstrong didn't research to any appreciable degree. Mr. Flynn may contend that all of this informing has been gathered by Mr. Young in the course of three years. The fact is, as he testified, that it's been gathered in a single month, what was possible in that month's period, and in just that short period of time showed numerous, clearly incorrect conclusions, clearly misleading information that Mr. Armstrong never collected, and that is only the tip of the iceberg.

Mr. Armstrong said that the hydrographic activity had never been done, yet Mr. Young said that he

4892

had found but not yet been able to obtain substantial correspondence between the hydrographic office and Mr. Hubbard from that time period.

4893

Snake Thompson.

Snake Thompson, Mr. Armstrong claims was there was no Snake Thompson. There was no evidence that Snake Thompson existed. And he is the one who made the issue of that.

Mr. Young was able to locate substantial information that Snake Thompson existed; that corroborated in every particular, every characteristic of this Snake Thompson that Mr. Hubbard had referred to.

The same is true for questions of combat, for questions of the Asia travels. And this is what was gathered in a single month.

Mr. Armstrong's conclusions are not based upon him being a researcher. Mr. Armstrong's conclusions are based upon the fact that he got into a self-perpetuating frame of mind in which he reached his own conclusions without doing the research; that this process increased as it went along.

Mr. Flynn in his argument made substantial references to various particulars; and I'll not deal with all of them. But let me speak to some of them.

Alexis. Mr. Armstrong has decided that L. Ron Hubbard is the actual father of Alexis Hollister.

The document that the Court has in evidence from Mr. Hubbard is completely consistent with every single known fact regarding Alexis, including the reference to her in the book. I believe it is "science of Survival," the commemoration to her.

4894

Mr. Hubbard said he treated her as his daughter, but she was not.

If the Court examines the dates, contrary to Mr. Armstrong's testimony that Sarah came back in July and that Alexis was born, I believe in March, an examination of the data will show that presumably she was conceived prior to the tine that she came back in July. But it is asserted as fact.

There is substantial discussion about Mr. Hubbard holding himself out as a nuclear physicist; yet, there is a document under seal in which Mr. Hubbard says, "I work in the field of nuclear physics."

In fact, originally the testimony was and the assertion was by Mr. Flynn in his opening argument that Mr. Hubbard held himself out as a medical doctor and a nuclear physicist except Mrs. Hubbard testified about that. So they throw up a whole bunch of things and pull them back if they can be responded to, the theory being that you can say everything with no facts; you can assert it and put the burden, in a case where it is not even the question, on the plaintiffs to somehow conclusively demonstrate each of these facts that they contend are inaccurate.

Mr. Flynn characterized the Molotov cocktail on the ALGOL that it had been reported and not found --that it had been found by Mr. Hubbard; but the record that the Court has shows that it had been reported by Mr. Hubbard.

Mr. Flynn says that he was obviously transferred as a result of this. Yet, the records available to the Court

4895

show that the transfer had been authorized some weeks before the incident even occurred, not that this is particularly significant, any of these particular facts of great significance except they demonstrate the continuing methodology.

Mr. Flynn said that Mr. Hubbard said he got a $10,000 check; in exhibit DD dated February 11, 1980.

Well, the Court can read it there. There is no reference to a $10,000 check, not a mention of a $10,000 check.

Mr. Flynn said that Mr. Hubbard was not crippled or blinded.

Now, of course, different people can have their meaning to words. But if the question is did Mr. Hubbard serious problems with his eyes, unless the Court wants to disbelieve an eyewitness at the time, Captain Moulton, he said Mr. Hubbard could not be exposed to light for even five minutes without severe headaches, without his eyes welling up, reddening, and watering.

Documents under seal themselves refer to substantial physical problems with Mr. Hubbard during this period with his hips, his shoulders.

It appears that Mr. Hubbard had serious problems with his eyes. He had serious problems physically.

There is a document talking about a hobbled gait.

Now, the submarine -- Mr. Flynn even argued, even after Captain Moulton's testimony, that the submarine incident did not occur.

4896

The Court, when it examines the documents that are in evidence, will have the opportunity to examine exhibit 500-I. That is the most extensive discussion by Mr. Hubbard of his own biographical background in 1972. Those are the notes for this biography by Tomkins.

And when the Court examines it, the Court will find that many of the things that have been perpetuated in whatever form are not discussed by Mr. Hubbard.

Mr. Hubbard discusses travels and says with respect to his schooling that he was going back and forth to Asia at the same time that he was in school and he did not do that well. And he then went to prep school to sort of catch up. And he basically got into college because of his IQ and spent some time in college. And he had spent a lot of time in Asia. And he talks about Commander Thompson which has been corroborated.

4897

And he talks about Commander Thompson which has been corroborated with respect to his war years. He basically says that he served the U.S. government in the U.S. Navy for several years, and was honorably discharged. That was written for Mr. Tompkins now 12 years ago, and the claim is made that Mr. Hubbard is involved in some kind of a continuing effort here to make statements which are purportedly inaccurate, which to the extent you have a dynamic at all, you have the dynamic that Mr. Flinn, our expert on religion, talked about which is the process of hagiography.

The defense in this case attempts to take everything ever written at any time and compress it as this is what Mr. Hubbard said, but the reality of life, the reality of a complicated religious organization, the reality of development and the reality of what Mr. Hubbard himself would have been involved in is different from that, so I hope that the court will look carefully at what, in fact, can be attributed to Mr. Hubbard.

In essence, the argument made by Mr. Flynn supports what we said at the beginning. Mr. Flynn's argument was really very little on the question of Mr. Armstrong's state of mind. Mr. Flynn's argument was really an all out attack on Scientology.

It is not a religion. L. Ron Hubbard is a fraud. It should be destroyed. It misleads people. That was his argument. I am not putting words in his mouth.

That was his argument, and his argument

4898

was a continuation of what this case has been about from the time it began.

Take these documents and attack and try to destroy Scientology.

That is not a proper reason for anybody to be able to take documents.

The documents that were introduced by Mr. Armstrong left out quite a bit. We gave the court a representative sample. There are documents that the court has found are privileged that were sent by Mr. Armstrong. I am aware of the court's view on that, but I would nonetheless suggest that one may not under any circumstances send a privileged communication for any purpose, for any reason.

You can not, even the courts say that they are not allowed to intrude into that.

Certainly an individual without the sanction of the law does not have any right to intrude into that. The documents themselves are, in fact, representative of these plus of pages of materials that are still downstairs because what was brought up to the court was anything that could be tried to be used to attack Mr. Hubbard or Scientology, and these documents show the enormous range of privacy that is at issue in this case.

Letters from Mr. Hubbard to Mrs. Hubbard, exhibit 4. He says,

"I am not in much of a mood to audit. I are principally worn out. I slept about 18 of the last 24 hours."

He goes on talking about personal things

4899

and the work that he is doing. He says,

"I saw the wildest solid gold brooch in a shop and I wanted to buy it for you. I didn't because I haven't a clue what size it would be in Arabic."

This for Mr. Armstrong's defense.

What is in that letter? That is what is in these letters.

The letter, exhibit 7, Mr. Hubbard is talking about, "How is Quentin doing?" Quentin being their son. He sent him a tape. He is getting together some materials for him. Describes what he was doing in the day, how he was feeling. That he was overworked, that he had been working harder than he had since 1963.

Letters from Mr. Hubbard's parents. These are just samples, to Mr. and Mrs. Hubbard.

Letter from Mr. Hubbard's father, exhibit 500 23. In the letter he is talking to Mary Sue Hubbard. "Our remodeled farm is so wonderfully comfortable with its setting back by timber and overlooking the great expanse of Puget Sound."

This for Mr. Armstrong's defense.

Your Honor, these documents were never sent for Mr. Armstrong's defense of anything. There was no case. There would have been no case had he not sent them and taken them. There was only a case because he took them, and he took them so that he could use them, and the vehicle to use them was the main vehicle, not under which Scientology attacks. It was the main vehicle under which

4900

Scientology is attacked in the courtroom to try to extract millions of dollars, using L. Ron Hubbard as the point of attack, and that is an admitted fact in the case.

That is why the documents were taken. That is improper, and we ask that the court return all of the documents for safe keeping where they will be safe kept as they always have been, and that the court award damages in this case.

Thank you.

4901

THE COURT: All right.

Well, I want to commend all counsel for good diligent efforts and their eloquence here today. I have got a long ways to go before I get through these exhibits. So I don't think it would be appropriate to make a decision at this time. So, obviously, a lot of thoughts have run through my mind as this case has been tried. So I guess I'll have to go a "mission sort out" here and try to sort out my thoughts and get things organized.

You'll hear in due course. I'll take the matter under submission.

MR. LITT: Your Honor, may I just make an inquiry? The documents that have been admitted into evidence, will they be maintained here in this court?

THE COURT: For the present, yes, they'll be here.

MR. LITT: Thank you.

(Proceedings concluded.)