What do you expect to get from lawsuit?

[skeptical]

I was just curious what you expect to get. You talk about bringing this lawsuit in an attempt to get a fair shake for all the people on the lists, especially those at the bottom who may never cycle.

I'm just curious what you actually expect to get from these sites? It will be Impossibe to get a full refund for everyone on the list. You people have this impression that site owners are sitting at a desk all day counting their coin and I think that's waaay off base. If most sites aren't shipping product it's probably because they don't have any cash to ship with.

Furthermore, if any site owner is intelligent they will be operating as a corporation or an LLC, so they will not personally be liable for any judgement.

So basically if you successfully win judgement against EzExpo you will get the court to say that everyone is owed their money. At this point EZ goes into bankruptcy proceedings and their assets (which certainly are nothing of substance, probably limited to the held funds by PaySystems and Ginix) will be equally divided amongst creditors (which would go to their vendors first, if they happen to have any outstanding bills, then to the people on the lists) and I bet people will get only a FRACTION of the judgement.

So in summary, my question again is "What do you honestly expect to get from this lawsuit" Do you just want a moral victory to avenge the fact that your ego was hurt when you bought into that matrix without knowing the game? Is your lawsuit a juvenile attempt to rally people behind you because it's alwasy better to be humiliated in a group? These are the only motivations I can guess that you may have because you know the math of matrixes, they DO NOT have the cash to refund everyone. That would be wholly impossible.

[hello]

What is there to gain? We all know that you can't get blood from a stone. Any way as far as easy ezexpo goes, WatchDog has already won because now Shelby has no CCP, no funds for shipping, people on the lists have been screwed and I after all the headaches I finally got a refund (yes they do give refunds even though they state that they don't). So personally I could care less about the lawsuit, Shelby or anything else to do with ezexpo. I'm done. Chowders.

[MatrixWatch]

Skeptical, you ask a good question. As far as I am concerned, this lawsuit is more about protecting future consumers from internet scam than personal gain to myself. This is listed as a class action and the people have the right to seek restitution through this suit. This lawsuit is not about me and Shelby, or about a personal vendetta against the matrix owners. People like to say these kinds of things because it belittles what is actually going on. So, what is going on? Super-rich pay companies are aiding nearly two-hundred matrix sites to operate under their umbrella. Worse yet, these sites are in obvious danger of violating many state laws against ponzi and pyramid scams. Even though this is the case, and MSNBC came out with an article in January proclaiming their possible legal liability (see NEWS), these companies still continue to service the matrix sites. As a result, more people can continue to get trapped on these lists. You can't operate a pyramid scheme, even if you allow people to enter it by buying something else (e-books). The lawsuit likens this to a hooker being caught for prostitution and telling the officer that the sex she offered was for free, it was the glass of wine that she charged $300 for. The ebooks, or whatever other over-priced item the matrix sites sell to people, does not keep these sites from the reach of the court's justice.

So, what I really want out of this is two-fold: First, I want future people to be protected from the grasp from these mathematically-impossible matrix sites, and second, I want restitution to be provided for the people who are currently involved.

Both of you are correct about EzExpo not having the funds available to grant restitution to all the people who invested in their site. Remember though, that the lawsuit does not call on EzExpo alone to pay damages, but the pay companies as well (Ginix, PaySystems, Neovi Data, etc.) I find it interesting when people say "...because people may only get 60-80% of what they put in, that makes the lawsuit unjust." This is a ridiculous accusation. If a person invested between $600 and $1500 (and many did) between the months of November and February, that means that they are unable to get a refund through the pay processors or their credit card. The time limit has expired for them. If you were one of these people, and you had the choice to get either $400-$1100 of your money back, or let EzExpo continue to operate in hopes that you may cycle in the next 10 years, which would you choose? I would take the 60-80%. This is an opportunity that many people involved in the closed sites did not have the opportunity to take part in.

You also mentioned something about the matrix sites avoiding personal liability by incorporating themselves. Just because a matrix company is listed as a corporation instead of an anonymous business does not give them the power to avoid legal responsibility for their actions. The CEO of IMClone was just sentenced to seven years in prison. IMClone is a corporation. Furthermore, this is not the situation with EzExpo. While Shelby Ware may have recently incorporated EzExpo, it was not a corporation when this lawsuit was brought on. Shelby must bear the responsibility for his actions. Also, you should know that Shelby Ware has filed a "General Denial." This is just a basic legal form. This is not something that would normally be used by an attorney in this type of case and, indeed, Shelby appeared in pro se (no attorney). Not only that, but Shelby served his own Denial by mail even though the proof of service says under penalty of perjury "I am not a party." Despite Shelby's big talk about "his lawyer," not only does he have no attorney at this point, but he starts off by committing perjury on his proof of service. A minor mistake but one that indicates he is in way over his head.

[Arzel]

Well Stated.

The limited liability issue, that has come up of late, is partially my fualt in explaining a possible motivation for shelby to incorporate. You are correct in this case, my definition was a broad based reasoning for someone to incorporate their business.

My expectation of this lawsuit is to end all matrices/ponzi's/pryamids, and so forth. Obviously this is not a reasonable expectation, but this lawsuit could create future schemes from easily doing business.

My reasoning behind this is that these schemes tend to attract those people that are least able to afford the outcome. One common post is that the person would never be able to afford a plasma tv or some other item without this kind of scheme. This is not a good situation for our economy as a whole, because if they go into severe debt and have to file bankrupsy because they got too far in over their head in matrices, it affects us all. Their debt doesn't just dissapear it is picked up by the rest of us.

[skeptical]

1) Naming of the pay companies in the suit
In order to win judgment against the pay companies you must prove that they were negligent or that these people’s losses were foreseeable and that the pay company could have prevented them. The pay companies represented these companies so they could process credit card payments for e-books. No matter what other law EZ was breaking (lottery, etc) the intention of the pay companies was only to process payment for the listed project. To use your (over used) hooker analogy, if a John paid with a check and on that check listed “one glass of wine” in the memo field, and the hookers bank cashed it, would that bank be liable? No.

I wholly believe you named the pay companies in the lawsuit only to give the impression that the lawsuit has more clout, and because these people have deep pockets and MAY be willing to settle (but I doubt that) just to avoid negative publicity. I believe you are extorting the Pay companies here and challenge you to tell me how they actually broke the law.

2) Shutting down EzExpo
Even if you win judgment it does not shut down EZ, at most it could prevent EZ from doing business in Cali. Plus, it does NOT stop any other matrix site from doing the same exact thing unless you sue them as well. Furthermore, if other matrix sites or EZ chooses not to do business in California then California has no jurisdiction over them. You’ll have to sue them in Federal court (which there is obviously no statute to do or your attorney probably would have done that. My guess is that there is no federal “Lottery” law and you both know that painting it as a Ponzi scheme is flawed) or you’ll have to sue them in all 50 states. And not until the law is changed can these sites actually be closed down. My suggestion if you want this to happen: write your congressmen (federal and state)

3) Possible restitution
You posted a scenario where someone pays $600 - $1500 and they might get back $400 to $1100. There’s a couple of things to remember:

i) This is the MOST you would get back, assuming the court orders a full refund, judgment is entered against the pay companies and the attorney takes the usual 1/3.
ii) It is more likely that the pay companies will not pay a cent (see point 1) and judgment will only be entered against EZ. If EZ has no money to pay, people get no money. It doesn’t matter what judgment is entered against EZ. They could add a Billion in punitive damages, it wouldn’t matter
iii) You need to be responsible and STOP blowing smoke up peoples *** about how much money they will get. It could be YEARS before they see a dime, if ever.

4) Personal Liability
Whoa Nelly, slow down. Sam Waksal, founder of IMClone was sentenced for INSIDER TRADING and PERSONAL TAX EVASION. He was NOT sentenced for misdeeds of the COMPANY. A Corporation is an entity separate form its employees, stock holders or officers. If a corporation breaks a law (polluting, for example) its executives are NOT liable. The same holds true to nearly the same extent (although this varies from state to state) for LLCs (Limited Liability Companies, sometimes referred to as “Ltd”) If an execute breaks the law himself while performing business for the company, then he is liable (read: Enron) HOWEVER, an executive is NEVER fiduciary liable for business of the corporation.

Regarding retroactivity (what the legal organizational status of EZ was at the time) I have no idea how the law applies to that.

How Shelby handles this lawsuit is entirely up to him and NONE of your business or mine. I think you shouldn’t be accusing him of committing perjury. If he has done so he would probably have had or will have criminal charges filed against him.


Timothy, please stick to the facts and not mislead people about who is liable, what you can expect to get from them, how long it will take, etc. You are committing the injustice when you do things like this. People have already bought into the pipe dreams of these sites, they were burned in many cases, and it is wrong for you to provide more unattainable dreams.

Perhaps you should have your statistics wizard whip up some numbers for the chances that these people will see even 25% of their investment before the end of the year, decade, or their lifetime.

[skeptical]

I assure you, Azel, that I didn't even read your post that you're referring to and I "came up" with the "Limited Liability issue" because it's, well, the law.

[MatrixWatch]

Thanks for your questions. Here are some answers.

1. California has a law aganinst a pay company's support for what would constitute an illegal lottery. The law suit gives the details on this. I am not extorting anyone. You used that word as an appeal to 'pathos' not 'logos'.
No, the bank would not be liable in your story, but you have drawn a false analogy to the present situation. In our case, the bank has hired the prostitute and is getting a cut of her earnings. A bank would be held liable for that. I am not saying that the paycompanies are evil, or that their names should be dragged through the mud. Perhaps they didn't know that these sites were pyramid schemes. However, if EzExpo is ruled as an illegal lottery, then some of them will need to be held liable for supporting this lottery.

2. Good point, but you say this while unaware of what the future holds.

3. Most of what you say here is your own speculative opinion so I can't really address it. You have a right to your own opinion. What I could say though is that I don't know how much the class award will be. I invoked the above situation (60-80%) as an EXAMPLE of a person's advantage to getting a settlement, rather than waiting to cylce, and how they have an opportunity that other people did not have. Most of the other sites have crashed or shut down, these being the only two ends that a matrix site can choose from. They cannot exist forever, only shut down and start again under another name. Something that has already happened several times over. It is also interesting how many people accuse a closed matrix site of being a scam when it closes, but when it is still running it is called "legitimate". What made the matrix site close down was its structure, something that existed when it was up and running.
Regarding the time span of the lawsuit, I don't think your criticism is significant. First off, even IF the people DID need to wait a year for their settlement, that is much sooner than they would wait for their name to move to the top of EzExpo's cycle lists. The math shows that at the present sign-up rate, the people on those plasma TV and PS2 lists will get their prize in 2050. The lawsuit is a better option for them. Furthermore, this case is not a civil suit, and it involves alleged violations of laws by businesses. These cases move faster than the others (think Martha Stewart Home Living).

4. This would take too much time to explain now, but just use common sense. Don't Presidents of companies like Enron, Worldcom etc, get sued all the time. A person is always liable his personal actions even if it is on behalf of a corporation. The Enron guys are not off the hook for what they did because they worked for a corporation. The reason it would take even longer to talk about is because the corporate examples that we have used are publicly traded companies, and EzExpo (as a corporation) has not even had an IPO. This is why we are taking it to the courts and hiring lawyers to sort it out.

The way that Shelby handles this lawsuit and EzExpo at this time may not be of your concern, but it is a great concern to me and the other members of the class. This is very serious, and every detail matters to how things will progress. I am not attempting to point out who will pay what either. I am invoking examples to prove points, just like you are.
In your final close you take a shot again at the point you have been trying to make this whole time. The issue of people not getting back 100% of what they put in. Your point is irrelevant to our cause. You paint this picture of the gross injustice of lawyer's getting a percentage and people not getting "enough". That is a non-issue here. What is the alternative, huh? Let the matrix sites continue to operate, allow their lists to get larger, and watch new people join the mix and get ripped off? The people who are involved with the lists at this time will NOT see ANY of their money. That constitutes damages... That constitutes a legal settlement. If it is not 100% of what they put into it, who cares? At least they get SOMETHING, and other people do not get pulled into this thing in the future. What I am doing is completely legal, and the lawsuit is not something "wrong" as you say. This kind of speech typifies what most of the matrix-site owners have been saying. Whenever legal legitimacy is talked about, they scoff at it and show a general disrespect for what business laws are intended to do: Protect consumers.

[Arzel]

I wasn't trying to persoanlly attack you skeptikal.

It was more of a general note, becuase I have been hearing the limited liability aspect being brought up frequently, and I just wanted to make clear that I wasn't trying to give EzExpo faithful some undo hope.

[MatrixWatch]

By the way. This is just a quick note. EzExpo "guaranteed" that a person would receive their free gift "when" they cycled. There are several people who have cycled and are checking their mailboxes everyday. If EzExpo cannot send out those gifts, that means they may be committing fraud against all those people who they made this promise to.

[skeptical]

"...you have drawn a false analogy to the present situation. In our case, the bank has hired the prostitute and is getting a cut of her earnings. A bank would be held liable for that."

The pay company has not "Hired" the matrix sites. The pay companies had a contract with EZ to process transactions for the sale of EBooks. Even if the law you eluded to exists and is worded in this way, you're relying on EZ being classified as a lottery which isn't a given.

Regarding bullet point 3:
That is not merely opinion. If EZ the defendent(s) do not have the means to pay, no matter what judgement is entered, people will not see a CENT. This is a FACT. This is why I say that you are making up fiction about how much $$ people will ever see. I understand your point that the attorney fees are legit, I'm not arguing that, but try this on: Owens Corning, Inc is a company that made asbestos insulation. They have faced BILLIONS of dollars in lawsuits for illness and death. They are in bankruptcy. Their ONLY WAY to pay restitution is to actually devalue their existing stock and give the company to the defendents. In the end the defendents are getting $.20 on the dollar for their judgement that they won in court. This company has thousands of employees and assets all over the world. If EZ Gets sued, they cannot pay more then what their company is worth, period.

If the Pay companies have judgement entered against them then you probably WILL see full restitution, but I doubt they will for the following reasons.
i) Is it true you didn't even serve them?
ii) Why don't you ever comment on what THEY'RE doing when you always talk about Shelby.. is it because their actions cheapen the threat of the suit?
iii) They surely have lawyers, probably of a higher quality and in a larger quantity then your own.

4) YOU. ARE. WRONG. The executives of Enron were found criminally liable for ACTIONS THEY TOOK ON BEHALF OF THE COMPANY, which is what I said in my post. An officer CANNOT be held liable for the actions of the company itself. If 10,000 people died from Firestones bad tires the engineers or even the CEO DOES NOT face charges. Same thing holds true with this situation. Bernie Ebbers (WorldCom) was arrested for FRAUD. Enrons officers were arrested for FRAUD. IMClones' Waksal was arrested for INSIDER TRADING. THESE ARE ACTIONS THE PEOPLE TOOK. If Shelby defrauds someone, he is liable. AFAIK, he has not. You need to check up on your case law and watch what misinformation you spread until you have.

I didn't call your lawsuit wrong. I said the way you were handling yourself is wrong, and i still believe that and have posted facts in this thread to back that up. I enjoy this dialog and do not wish to make it personal with you, I hope you, I, and any onlookers benefit from this very candid discussion.

[Arzel]

Considering the time required to cycle if you are at the end of one of EzExpo's list (or even near the top for that matter) I think that they will see a settlement from a class action suit much faster.

I was involved in a Class Action lawsuit once, was not even aware that what they were doing was illegal. I had been putting some money into Franklin Life for what I was originally told was a type of savings account. It wasn't very much money, but since I was in college at the time I didn't have much money :) After graduating and getting a real job I decided to invest a lot more money into this fund, the returns I was told were pretty good. As luck would have it the day I was going to call in set up a time to talk to a local investor I recieved a class action suit message in the mail. I had actually been paying for a life insurrance policy that was basically worthless for 5 YEARS! Franklin settled with something like 20,000 people I think, and I got half of my invested money back in one year. By my calculations my "Investment" should have been worth about twice what I paid.

So don't diss all class action lawsuits. Also, don't say "You should have known with a name like Franklin Life" The guy I talked to insisted it was not a life insurance policy, and obviously I was not the only one.

[MatrixWatch]

The false analogy issue-
Whatever way it goes: Bank hiring prostitute, prostitute hiring bank, there is still a business relationship going on. Your original analogy said that the bank would not be liable, I was saying that the bank has a different role here if your analogy would be properly applied to this situation. You need to go back to what you were trying to do in the first place, argue AGAINST the anaology. You called it "over used", but I have yet to hear a counter argument to it.

Of course the issue of EzExpo being an illegal lottery is not a "given" yet. That is what the lawsuit is about, and that is what the courts will determine. This whole thread is about the hypotheticals of what would happen IF EzExpo lost the suit. We are strategizing here, so don't indirectly try to point out that what we are doing is ridiculous because it rests on that assumption.

Regarding bullet point 3:
You are saying that point #3 is not your "opinion". Okay, lets go through point #3 and see what is fact, and what is your opinion.


3) Possible restitution
You posted a scenario where someone pays $600 - $1500 and they might get back $400 to $1100. There’s a couple of things to remember:

This part was MY opinion


i) This is the MOST you would get back, assuming the court orders a full refund, judgment is entered against the pay companies and the attorney takes the usual 1/3.

This is your opinion because it was based upon the percentages expressed in my opinon. We are still in hypothetical land at this point.

ii) It is more likely that the pay companies will not pay a cent (see point 1) and judgment will only be entered against EZ. If EZ has no money to pay, people get no money. It doesn’t matter what judgment is entered against EZ. They could add a Billion in punitive damages, it wouldn’t matter

Even YOU know this is an opionion. You start if off with "likely", and you state that it is based on point 1, an opinionated point. You don't know how much they will pay until court time.


iii) You need to be responsible and STOP blowing smoke up peoples *** about how much money they will get. It could be YEARS before they see a dime, if ever.

This is obviously your opinion. Also, I never said how much money people would get, I only stated a possible situation to prove a point in a completely different context. The context was the benefits of either staying on a 10 year list, or getting a settlement sooner.

Then you said this:

If the Pay companies have judgement entered against them then you probably WILL see full restitution, but I doubt they will for the following reasons.
i) Is it true you didn't even serve them?
ii) Why don't you ever comment on what THEY'RE doing when you always talk about Shelby.. is it because their actions cheapen the threat of the suit?
iii) They surely have lawyers, probably of a higher quality and in a larger quantity then your own.

i) Read the lawsuit, and contact my lawyer (wilens@cox.net). I don't know the complete answer. They ARE mentioned as Defendants.
ii) When I do know, I'll comment. I did comment on how Ginix dropped them because of the suit. That is the only move they've made, and that is the only move I've mentioned. The final question of this point is not even worth answering.
iii) What you say here is very emotional and strictly opinionated. Might does not always make right, nor does it always guarantee victory. I don't even know why you said this.



4. EzExpo "guaranteed" that a person would receive their free gift "when" they cycled. There are several people who have cycled and are checking their mailboxes everyday. If EzExpo cannot send out those gifts, that means they may be committing fraud against all those people who they made this promise to. I already posted this. Also, I don't usually read books on case law, so I'm sorry if my answers do not suffice. If you need a deeper glance at any of these points you may contact Jeffrey Wilens (wilens@cox.net).


Here is what I would like to know from you or anyone else: What reason can you come up with to argue against the issues set forth in the lawsuit. These are the issues we need to be concerned with. Why is EzExpo NOT A LOTTERY. I hear people on the forums, and you yourself, throwing out smoke screens like, "The people won't get that much from the lawsuit", "Tim is in it for his own personal revenge", "Shelby will overcome", "This lawsuit is frivolous", "You are an idiot", "Why don't you say more about the pay companies?"etc.

Notice that these statements side-skirt the issue and never drive home at the fact of the matter. Maybe you can answer it "Skeptical"?? How is EzExpo not a lottery under CA law in such a manner as the lawsuit says it is? If you can answer this one, then you can truly jump this hurdle.

[CurtXxX]

Yeah this is a good debate!!!

[MatrixWatch]

Mr. Skeptical,
The purpose for the forum is to present opposing viewpoints and you have done a good job presenting the "skeptical" view. Just to let you know however, I am not an attorney and will have to defer to my attorney's expertise and the court's rulings. We are just going to have to wait and see what the court does but there is very good reason to be optimistic that many people will recover money.



Here are a few more points on some of the issues raised here.


1. The Pay Companies Ginix and PaySystems have been served and both have well-regarded defense firms representing them. They will file their legal responses to the lawsuit by mid July.

2. Mr. "Skeptical" is not familiar with California's Unfair Competition Law, Business and Professions Code section 17200. It allows anyone involved in unlawful conduct, including aiding and abetting it, to be compelled to make full restitution to anyone who paid money.

3. The lawsuit alleges the Pay Companies knew exactly what EZ Expo was doing, and recognized (or should have recognized) it was a lottery, but simply chose to let it operate so they could personally profit. If we prove those allegations at trial, they will have to pay in full.

[eagles27]

Pay in full to who? The class action suit, or to ezexpo?

And whats stopping them from saying ezexpo put on the registration that they were selling 'e-books'?

Also, you can't do anything to the pay processors without first making matrix sites illegal and deem them a lottery (a judge deeming them a lottery, not you). So you can't get the pay processors without first getting ezexpo and matrix sites in general.

Plus, how can you possibly prove that they knew it was a lottery. You have NO evidence of this. You have to have OJ Simpson's lawyer prove that one. Jeez. lol

Attack matrix sites all you want, but going after the processors is ridiculous.

Finally, Why aren't you going after Paypal as well - they once processed payment for Ezexpo?

[MaxPower]

Watchdog knows what he is doing. The lawsuit is going to kill two birds with one stone. I don't see why anyone is against him, he's only doing what is best for the majority. Keep up the good work.

P.S. watchdog: what is the time frame we are talking about in which this case will be in court? Six months? One year? More? And don't worry, I'm still planning to join your class action suit. I just need to organize my reciepts. I have not been responding on this board much recently. Thats because it seems to be well taken care of, and the good people are representing their case very well (before I get a chance to put in my opinion, therefore I do not need to interject). I've been trying to keep our argument going strong on Damion's site. At least now we are heard fairly; now that Damion has once again taken power. We've got a few good allies over there, including Bobby and someone named alienmatrix. I will try to get on that other message board also. Keep up the good work Tim. I'm sure that many appreciate that you brought fourth this lawsuit.

[MatrixWatch]

I am not sure about the time frame. I have heard from some attorneys that because the case involves more than what is found in the average civil case, it will move more quickly. As stated above, the pay companies are expected to file a response in about 3 weeks. My lawyer would have a better answer for this one though. Max, I would recommend that you contact him as well. Did you read the announcement on the Matrix Watch home page ("Important Announcement")? His email is wilens@cox.net

Eagles,
You are raising questions and that is good. I never said that I was deeming anyone as anything. As stated above, this thread is about the hypotheticals. The questions being asked here deal more with the "what if's" of our side winning the suit. Also, I answered your "to who" question already in my last post. You also said that we have "no evidence". Where is your evidence for the fact that I have no evidence? Didn't you read the lawsuit? It is addressed there. In my opinion, Ginix had to have known about it. PaySystems began to give EzExpo problems after an article was released by MSNBC. You can access this January article in the NEWS section of our site. After EzExpo parted ways with PaySystems, Ginix picked them up. To me, it is incomprehensible how Ginix could have no idea about PaySystems and the MSNBC article in their relationship with EzExpo.

[skeptical]

Let's pick up where we left off.

These are FACTS:

- If you win judgment against ONLY EZ and NOT the pay companies, the most money defendants will ever realize is equal to the net worth of EZ. In this case, not very much.

- IF (IF!) Shelby or Damion had EZ organized as a business (rather then a sole proprietorship) then they will NOT be personally liable to pay from their pockets any monies to the defendants.

- If you win judgment against the EZ AND the pay companies, you will probably realize your the full judgment

- Even if you win judgment and realize it in full, defendants will only get 2/3 with the attorney taking the rest. This is not terrible, this is the nature of the system, but is a fact nonetheless.

- Even if the defendants only get $.50 on the dollar (Or $.20 as in the case of Owens Corning that I discussed below) the attorney still takes his 1/3. Again, this is not terrible and it is not a reason not to join the class, but many people should be aware of it.

- It is, of course, a fact that you may not win this lawsuit. The biggest reason I dislike this suit is because you're rallying these people who bought into the matrix system, got their hopes sky high and watched them drop like a stone, and now you're again inflating their hopes and they, again, may be let down. You're not taking a david/goliath approach saying "It will be tough, and we may loose, but we're fighting the fight" instead you sound so sure of yourself that you will win and you make people sure and they invest in you, and you have no guarantee on delivering on these promises. This would be adding insult to injury, having bought in to two people promising to get (or make) them money, and having both prove wrong.

************************************************
AND THE MOMENT YOU'VE ALL BEEN WAITING FOR
************************************************

Why is EzExpo NOT a lottery?

According to California Penal Code 319, a lottery must have the following attributes:

- A Prize
- The element of Chance
- Consideration ($$ to enter)

If any one of these is missing, it is not a lottery.

In EzExpo you purchase an EBook. The "lottery ticket" (the entry on the list) is given to you in exchange for your purchase of the eBook. You are saying that the eBook itself is the "lottery ticket" and it is not. You call the eBook worthless. The problem is that in America a products fair market value is whatever the public is willing to pay for it. Perhaps that information is "readily available" on the internet, but perhaps the purchaser of the book doesn't care to search it out. If someone is willing to purchase a book, and they understand that is ALL that they're purchasing, then they are giving that book market value.

Sure, they are selling the same books, sometimes, at higher prices. This is also the nature of the market. I may drive off the lot with the same exact car that you bought from the same lot in the same day and I may get it $2000 cheaper. This is not an unfair business practice, it happens all the time.

Your hooker analogy is flawed, and here's why: It has no foundation. (That’s a legal term that you can ask your attorney about) In that analogy you're ASSUMING that the person is a hooker. Without that ASSUMPTION there is no law being broken. If a man meets a woman at the bar, buys her a drink (even a $300 bottle of Cristal, or a $300 box of wine that is only with $300 because it's her favorite) and gets laid, he is not soliciting sex.

To apply this analogy to EZ is also without foundation. You are ASSUMING EZ is a ponzi scheme, which would make the purchase of an EBook in exchange for the FREE "Lottery Ticket” illegal; but that's the enigma. You must first prove that getting FREE entry into a prize list is a Ponzi scheme BEFORE that analogy is correct.

I encourage all of you to think about this long and hard as I have for quite a few weeks.

Next?

[Arzel]

Show us that the mojority of e-book buyers bought the e-book for the information inclosed and not the prize associated with the e-book, then you have made a valid point.

But let me ask you this. How many of the 1750+ people on the plasma list at EzExpo truely bought that e-book for it's inherant value?

I bet you half could not even name the e-book associated with the plasma list without looking it up, but 90% could tell you what position on the list they are currently at (within a few spots).

I think that when a judge reviews this case, it will be quite apparent that the prize sold the e-book, and not the other way around. That judge will not have a difficult time in seeing that the e-book is the lottery ticket.

[skeptical]

EZ is only liable if misconduct or misuse was foreseeable and/or EZ was negligent to prevent it.

It is true that the misuse of this system (buying books for the sole chance of winning a prize) was foreseeable. HOWEVER, EZ was not negligent. They took precaution and stated very clearly what the user was actually purchasing.

If reasonable precaution is taken the vendor is not liable for the misuse of their product. For example:

- A lawsuit was dismissed against Sharman networks because the misuse of KaZaa is not their fault.

- If a user purchased cold medicine for the sole purpose of extracting pseudoephedrine, the pharmacy is not at fault

- If I lawfully purchase a gun with the intent of killing someone the vendor is not at fault when I do

These are not direct analogies to EZ but the point is that a customers INTENT is not the responsibility of the vendor as long as the vendor is not negligent.


The burden of proof is NOT on EZ, and even if you do prove that the majority of users purchased the book just for the entry to the matrix, that goes to the buyers state of mind not the sellers.

[Arzel]

I don't believe that you will be easily swayed, but I still think you are missing an important aspect.

EzExpo was not setup to sell ebooks, it was setup to give people an opportunity to get electronic information cheaply. The homepage clearly states.

"Welcome to EZ Expo!
We are your Leader in Electronics-based matrices!"

The sites does not even mention that it sells ebooks until you get to the product page, in which case it is a "wink, wink, you are not reallllly buying into the matix, you are buying an e-book, wink, wink".

The judge will look at the intent of the site, and the intent is clearly to use ebooks in order to make the scheme legal. Just because they make statements to the fact that the buyer is buying e-books and not the item, the intent is opposite.

In your examples you fail to correctly link intent. The purpose of the ebook in this situation is clearly to try and make an illegal process legal.

In your cold medicine example, the intent of the cold medicine is to give relief from a cold, trying to modify the cold medicine to perform some other action is not the fault of the manufactors of the cold medicine.

Because of the nature of this case intent is going to be the deciding factor. Was it the intent of the customers to find information on how to setup a website or on how to get a plasma tv for $150? By number of upset people coming forth I would say it is the latter, and I think any reasonable judge will as well.

[MatrixWatch]

Skeptical,
The ebook issue is a red herring. Even if it was the issue, do you see people on the testimonials pages holding up a disk with their ebooks on it, and a big smile on their face; the caption reads, "I just downloaded my ebooks!" The prostitute analogy is correct because the matrix concept is pure pyramid scheme. They cover their obligation to the laws against this with their "fig leaf" of e-book sales. I am impressed with your list of the lottery requirements, but you need to read the lawsuit again. The answers to your questions are listed in there. EzExpo promises you a free gift IF you cycle. That's chance. Whether the appropriate amount of people join the matrix under you is also delegated to the realm of chance. Your attack on the lawyer's 1/3 and people not receiving their due reward fails to take certain laws on CA class actions into account. You are still harping on that old point, that people should reconsider getting involved with the suit because they won't get paid. So, what is their alternative? Getting involved in the lawsuit does not hurt them in the slightest bit. I really don't know where you are going with all of this. Do you want people to follow your guidance and support these matrix sites? I suppose that you are offended by my total confidence in victory, and you want to be "skeptical" about that. Fine, you are entitled to your own opinion, but I still have full confidence in this lawsuit's ability to bring restitution to all of these people.

[skeptical]

Big Dog,

Something you may not be aware of and may actually enjoy is that I first started using the name "Skeptikal" on the EzExpo forum months ago as I was skeptical of the whole matrix thing. I do support the matrix concept, although haven't actually invested any money into one. Personally, I don't see any harm in the "chance" aspect of a matrix, as long as people know what they're getting into. Unless a matrix site provides false information to a user, I see nothing wrong with what it does. Caveat Emptor. Know what you're getting yourself into. If someone signed up w/o knowing what this is, it is their fault. Currently, this is legal and if it wasn't legal these site owners would be in jail. You want to penalize them for doing something that is actually, at this time, within the realm of the law.

You want to set a judicial precedent that makes this illegal, the problem is that if you do this, everyone on the list will surely loose out because the site owners will be forced to shut down. So you want to force refunds, even if it means that the site owner must pay out of pocket, penalizing a capitalist for a business that, when created and operated, was inside the law. What you are doing to these site owners is unjust, and as much as you want to portray them as miser scum, they have rights as well. You're basically saying to them: "Even though this wasn't against the law, you should have known that it should be, and known that it will be, and because you weren't claravoyant you will now be penalized"

This is wrong, Tim. Because thousands of people didn't know what they were getting themselves into, you wish to penalize the site owners. I'll admit, many site owners are not pleasant and many have ill intentions, but many walk the straight and narrow.


I didn't use the legal fees issue as a reason not to join, in fact I said this specifically referring to legal fees:

this is not terrible and it is not a reason not to join the class, but many people should be aware of it.

I'm not trying to convince people not to join the class because they won't get paid, I'm trying to set realistic expectations for those already in your class and those that are thinking about joining. You paint the picture that you will win without a doubt, that people will get a full refund, and that is simply not the case. Even if you win you may not see a cent. People need to know this.

You didn't comment on this:

The biggest reason I dislike this suit is because you're rallying these people who bought into the matrix system, got their hopes sky high and watched them drop like a stone, and now you're again inflating their hopes and they, again, may be let down. You're not taking a david/goliath approach saying "It will be tough, and we may loose, but we're fighting the fight" instead you sound so sure of yourself that you will win and you make people sure and they invest in you, and you have no guarantee on delivering on these promises. This would be adding insult to injury, having bought in to two people promising to get (or make) them money, and having both prove wrong.

Tim, we both know that the more people that join your class, the better. Your lawsuit will carry much more weight if you have 5000 as opposed to 100. I believe you choose to paint a better picture of the possible outcome then is likely. It is for this reason that I've posted this entire thread. I want people to know what they can realistically expect. You paint a picture, I paint the opposite, the truth may be either one or somewhere in between, but people need to know this.

Now onto new business:

do you see people on the testimonials pages holding up a disk with their ebooks on it, and a big smile on their face; the caption reads, "I just downloaded my ebooks!"

Of course you don't, they are testifying that this free gift that is being promised actually is legitimate. A free gift can be a legitimate reason to buy a product. Publishers Clearing House comes to mind. In a sweepstakes, you purchase a product and in exchange for your product you are entered into a pool of possible winners of a sweepstakes.

Look at that, it seems the EZ is more accurately a sweepstakes, isn't it?

Everyone that buys Pub Clearinghouse knows they're going to get their magazines, but do they put that on TV during the Super bowl? No... they want to generate hype about their product. This is a common practice, tim, and Pub Clearinghouse is just the best example.



I am impressed with your list of the lottery requirements, but you need to read the lawsuit again. The answers to your questions are listed in there. EzExpo promises you a free gift IF you cycle. That's chance. Whether the appropriate amount of people join the matrix under you is also delegated to the realm of chance.

Tim, please review section 319 of the California penal code. A lottery must have:

-A Prize
-The element of chance
-Consideration ($$ to buy in)

If ANY ONE of these is missing, it is not a lottery. I venture that there is no consideration. Much like publishers clearinghouse, EZ is selling books and giving you a chance to win.

As I said yesterday, I think this discussion is of benefit to others. I appreciate this continuing debate and have enjoyed taking you to task on these issues.

[surgeon]

Basically, if people can make a totally informed decision about entering into the matrix including average wait times for varying list sizes, they are not making a gamble, nor are the being scammed. I think the case rests on the fact that there is a chance that the structure will collapse, i.e. no one buys into the cycle anymore. But I think this is a poor argument:

It seems to me that if the person knows their place in the matrix, they can calculate roughly how long it will take before they recieve their product, especially if they have the help of the proprietor. Taking for granted that the Judge will see that they are in fact buying into the cycle AND buying a product, and taking for granted that the calculated time will not not have a large variation from what it will be in reality in the average case, how is the person making any more of a chance than that which they would make from purchasing any other advertised product that may or may not meet expectations? If I go to the dollar store and pick up a flashlight, am I making a gamble? It probably wont work for very long... but it might. The benefits of buying that flashlight (light) may never even be realized, just as the benefits of buying into the cycle wont.
or what about this case: I walk into an Indian food restaurant and tell the propriator that I've never eaten the food before. He says I can purchase a selection of three dishes, but cant gaurentee that I will enjoy all of them and get my money's worth. Is this a lottery?


One last thing:
the owner of the site isnt even making any money off of this. The 1000 or so people who have cycled have made a combined total of far more than he has... so it seems to me that he is in fact providing a beneficial service. Can I please have an explanation of why this guy is doing society a disservice and why he deserves to be hauled into court and retain an expensive lawyer? It looks like theres a lot of happy people, and a lot of people that, if they had researched the phenomenon correctly, would be complacent. The average investment seems to be about 100 bucks, a couple days work for most people.

So, from a moral standpoint, what is the purpose of the lawsuit? are you trying to protect people from themselves? Are you of the opinion that the state has to be a nanny, and that since SOME people are likely not to fully research their investment, then ALL people should be barred from investing? Thats a pretty weak argument that has been debunked for a some time now. I feel really bad for the guy because it seems to me that he honestly thought he had a good idea that would help a lot of people. For those that it doesnt help, should they not have paid a little more attention to what they were throwing their money into?

[MatrixWatch]

Skeptical,
Thanks for your questions.

You started off by saying that there is no “harm” done by matrix sites as long as:
1. People know what they are getting into
2. False information is not presented to a user
3. The buyer knows that he is responsible, and the site is not

I respect your view, and I choose to see it another way. First off, people do not know what they are getting into. Sure they can take a “calculated risk” when they join the matrix site, knowing about the mathematical probabilities that they will never see their gift, and hoping that somehow hundreds of people will eventually sign up under them. I think that the long duration of time that matrix customers are willing to wait out is why they join. They think, “If it takes a year I am willing to wait. By that time I am sure that hundreds of people will join under me and the auto-cycling process will also help me out.” This, as you and I know, is not the case. What the matrix sites do not tell people about is that the pay processors that handle their sites have the tendency to freeze their accounts once and a while. What the matrix sites also do not disclose is the fact that when that happens, people ask the CC processors for refunds, which produces extra fees for the matrix site. After that storm, the matrix site “might” get its money back, and at that point they need to start paying off the cycled customers from when the processor first froze their funds. In that time duration the site has lost a lot of money due to all the charge-back fees. A great deal of this info is presented on the forums, but EzExpo has repeatedly removed the link to their forum from their website. Did people really know what they were getting into? I don’t think so, otherwise you wouldn’t see the mad dash to the CC companies for a refund. My point is that people cannot make a completely informed decision because they are unable to do so with the information that the sites give them. If people were completely informed, they would not join the matrix. These sites thrive on new customers not knowing exactly what is going on behind the scenes. Life is like that though, I’ll agree. We don’t always know about all the facts when we buy into a stock, or a product. However, the hope of the consumer is the protection of the law. I am fighting to bring these sites to the law’s attention in order to protect future consumers.

Now, let’s move on to your point about false information. If you read through the lawsuit, a great deal of time is spent on the FAQ page on the EzExpo home site. This set of FAQ’s has been copied and pasted onto other matrix sites as well. The cycle lengths have been repeatedly changed, and certain promises have not been acted on. Take the cycle guarantee for example. EzExpo (and other matrix sites) promise that a person will receive their free gift if they cycle. There are a great number of people right now on the forums who have cycled off matrix sites and have yet to see their prize. The matrix site’s funds are frozen and their hands are tied, but that was not mentioned as a condition in the guarantee. They are often given a time frame of 6-8 weeks to receive their gift, but EzExpo’s “already cycled” list (for example) is backed up all the way to January. EzExpo even changed certain terms in their agreement with their customers, such as refunds, without telling them until they asked for one several months later. So, was false information presented to these users?

Your third point is that the buyer bears the responsibility for any poor results because of the classic rule of the Grecian marketplace “Caveat Emptor” (Hortatory Subjunctive Latin phrase for ‘let the buyer beware’). If these matrix sites are in violation of State laws against illegal lotteries and pyramid schemes, then the real rule here will be “vindet emptor” (let the seller beware). Not only are these people misdirected into joining the matrix sites through the smoke and mirrors of auto-cycling promises and award guarantees, but they are also misinformed about the questionable structure of these sites. Just to make something clear, I am not trying to establish a Judicial precedent, I am attempting the make these sites accountable to laws that have already been passed. Just because no one has prosecuted them on this does not mean that what they are doing could already be illegal. I am acting on behalf of those people who were duped into joining EzExpo’s game of chance, and I support the other lawsuits that hold matrix sites accountable to the same set of laws. If the law forces them to shut down, the lawsuit demands that they provide the lists of their clients and that the proper actions be taken to compensate the people on the lists. I do not have a vendetta against these sites, but I do want the internet to be accountable to the same laws that exist in the town square. The discovery of the internet is a lot like the discovery of a whole new continent. Savages and scam artists abound here, and it is time to fight the appropriate battles to clean it up. Matrix Watch is one of many cause-oriented groups doing just this. I say this because you make it out to be my personal mission to destroy the personal reputations of site owners. This is not true. This is business.

You then went on to say that you bring up all of this talk about lower reward amounts given to the class for the purpose of setting more realistic expectations for them. No one on my site said anything about getting a bunch of money out of this thing. This is about a cause-driven goal to prevent others from joining these sites, and unmasking this modern-day pyramid scam for what it is. On top of this, those who join this cause have the opportunity to seek financial restitution. I suppose that if they wanted to increase their chances of getting more money they could file their own lawsuits against other matrix sites and pay companies. I have yet to see people doing this though.

I DID comment on this:

The biggest reason I dislike this suit is because you're rallying these people who bought into the matrix system, got their hopes sky high and watched them drop like a stone, and now you're again inflating their hopes and they, again, may be let down. You're not taking a david/goliath approach saying "It will be tough, and we may loose, but we're fighting the fight" instead you sound so sure of yourself that you will win and you make people sure and they invest in you, and you have no guarantee on delivering on these promises. This would be adding insult to injury, having bought in to two people promising to get (or make) them money, and having both prove wrong.


…when I said,

So, what is their alternative? Getting involved in the lawsuit does not hurt them in the slightest bit. I really don't know where you are going with all of this. Do you want people to follow your guidance and support these matrix sites? I suppose that you are offended by my total confidence in victory, and you want to be "skeptical" about that. Fine, you are entitled to your own opinion, but I still have full confidence in this lawsuit's ability to bring restitution to all of these people.


As far as the amount of people who join the suit, that is irrelevant right now. The case was filed in such a way as to not require hundreds of people to sway the opinion of the judge. In fact, historically when a pyramid scheme goes to court, more opponents of the suit show up than supporters. That never stopped the courts from ruling against them.

Now onto your new business:

…they are testifying that this free gift that is being promised actually is legitimate. A free gift can be a legitimate reason to buy a product. Publishers Clearing House comes to mind. In a sweepstakes, you purchase a product and in exchange for your product you are entered into a pool of possible winners of a sweepstakes.


I am glad that you brought this up. Actually, the Publisher’s Clearing House contests do not require a purchase to enter. If you read the small print for this contest, or any other legal contest for that matter, you will see that you can send in a 3x5” card with your name, address, and telephone # on it to still be eligible for the prize. Or, you can check off a little box in the response card that says, “No, I’m not interested in magazines, but please enter me in your Grand Prize contest”. They do this to be legal. A matrix site cannot be run legally and still make money. They would need to provide a free entry into the matrix without having to purchase the e-books. If they did this, then people would send in the postcard because they would not have any use for the e-books. Those e-books are worthless and I have heard customers say it themselves. Just take the whole “free gift” incentive away and


You concluded with,

"Tim, please review section 319 of the California penal code. A lottery must have:
-A Prize
-The element of chance
-Consideration ($$ to buy in)
If ANY ONE of these is missing, it is not a lottery. I venture that there is no consideration. Much like publishers clearinghouse, EZ is selling books and giving you a chance to win. "


I answered this already. The lawsuit touches on each of these points. If they promise the customer that they WILL cycle, that would make them a fraud. So they have to promise a free gift IF they cycle. This is why my attorney said in the MSNBC article that they are “trapped”. They have fraud on one side of the phraseology, and running an illegal lottery on the other.

[skeptical]

Thanks for the prompt reply.

I appreciate your comment on sweepstakes; I didn't consider that aspect when I posted that EZ may be more like a sweepstakes then anything else. My original point about the sweepstakes, however, is that the rewards are advertised more then the actual product, much as a matrix site does. This is still true and a valid comparison.

It seems to me that much of the evidence you're using in your suit and subsequent discussion relates specifically to misconduct on behalf of EZ and not to the nature of a matrix itself.

Although I've been following the matrix scene since the original MSNBC article came out, as I said before I was never a customer of EZ. I viewed their FAQ and their forum but didn't study it. If EZ did mislead their customers with false information then that should be punishable, butI can't tesitify to whether or not they did.

The only aspects of your suit that would apply to the actual matrix business model are the allegations that it’s a Ponzi scheme and that it’s a Lottery. Both of these issues are mitigated by the product you buy to enter into the matrix. It is not even debatable that if you buy a product that has worth and in exchange for your product you get entered into a “contest” or “lottery” or “matrix” for free, the operation is legal. If that “Lottery Ticket” is free to you, then there is no “Consideration” for the lottery. You are not paying a dime; therefore the lottery is legal under California law.

The biggest question of fact here, then, is do the eBooks have value. This is different then “do the ebooks have value to the person who purchased them.” If I bought tampons, for example, they would be worthless to me, but they still have market value, and I supported that market value by purchasing them. Whether or not the ebooks are devoid of value to some people does not make them worthless.

I’ll give this some more thought, and probably post again in the morning.

[MatrixWatch]

It is funny. Under this thread, a response two hours later is considered a prompt response. I think that is because we are digging deep here to really investigate the nuts and bolts of the situation. I would like to thank Skeptical and the rest of you who have posted. As this conversation continues, I would ask that those of you who have questions to please write you question down and then read through the entire thread. This will deepen the thought content of your question, or you might get it answered. I think that many people are thirsting for answers on this topic. This is why so many have visited. Yesterday was our busiest day ever!

[monteman11]

WQhat is going to happen is you and everyone including me will get NOTHING. I hope your lawyer charges you an arm and a leg. There is no legitimate suit and you will lose. And when you do i hope someone sues you for some other illegitimate reason just to cause you some financial pain. You hace ruined my chances maybe i can sue you for that, when EZ is found not guilty. It makes about as much sense as your lawsuit

[xtroublex]

WOW

There defenatly is a lot of emotion involved here! I find it interesting that there are people defending EZExpo only because I have had several conversations with Damion.

In fact, Damion was the one that convinced me to open a matrix site and promised me all sorts of free marketing etc. Telling me how much money could be made.

Here's the really funny part, after I realized that all matrix lists are eventually destined to fail, I asked him flat out.

"Damion, don't you think that eventually no one will sign up anymore because the lists are so long?"

He ansered "No".

So either they actually believe their own poop or they are lying to everyone. Remember, these comments are coming from a SITE OWNER.

Now I am stuck because I have all of these people whom I will have to refund and I don't have enough to do that.

I have been investing in marketing etc. So can I sue Damion for leading me into this business? Isn't it similar to a person buying into a list?

Signed

"A Remorsful Site Owner"

[MaxPower]

Glad to see a site owner with some dignity.

[damion]

xtroublex

I am not sure who you are but let me go a step further on your statement here.
I never just said flat out "No" so you have already discredited yourself in my book.
Anytime someone asked me about it, I would reply with the same thing - "As long as people sign up at an exponential rate there is nothing to worry about".

EZ Expo ran good with the auto-cycling I had in place and the money that was coming in from sites that I helped although a few of them I never saw a dime from - I am guessing yours is one of those since you say I never relaly helped you - or implied it with your post.

If you are going to post facts - get them all out there and not just what makes you look good.

Damion

[MatrixWatch]

If you do continue this interesting conversation, please start a new thread for it so that this one will not go off topic.

[brokepoker]

"As long as people sign up at an exponential rate there is nothing to worry about".


THAT IS CLASSIC! JUST CLASSIC! OH MAN OH MAN THANK YOU FOR MAKING MY DAY.

bwahahahahahaha...hahaha..haha..

eponential rate...bwahahaha..haha..ha

hee hee...snort..nothing to worry about.

[dappa219]

It is ironic that the watchdog brought op the point of aiding and abetting the alleged matrix "lotteries"

It is interesting to note that based on past post and email correspondence provided by Damion (former owner of Ezexpo) that our "Watchdog" leader was at one time interested in purchasing EZexpo.....

It is in my opinion that watchdog's past interest in purchasing and running a site which he inturn sued for unfair business practices (referencing Business and Professions code 17200) will place a snag in his case and intent.

Furthermore, Watchdog will have to prove in court that he didn't purchase from the site with the intent to turn around and sue them for his unjust enrichment.

As constituted by US laws, all parties in a case are innocent until proven guilty. Mr "Watchdogs" allegations and his publicising them has placed a loophole in Ezexpo's defense whereby the plaintiff has knowingly and unlawfully damaged a company's name without an official court ruling of his/her/their allegations. Such actions may be deemed slander or libel and could warrant a counter suit against the plaintiff. Therefore Watchdog, it is important to note in all your public correspondence that these claims are actually allegations rather than factual. Please note that "class action" meaning the involvement of a certain "class" or group of people does not warrant "general" public domain in your case.

In conclusion, it is also important to note that Penal Codes have conditions. One condition of the entire article constituting Mr Watchdogs allegations bases itself on the "Company's" intent to deceive its customers. Failure to prove this intent may prove even more detremental to your case. If your intention with this case is to stunt the defendants business, and you fail to prove all conditions required to win your case, you may find yourself in deep trouble when your case is over. The "defendant" may on his/her/their terms counter sue you and you may be liable for punitive damages 3 times that of which the "Plaintiff (former Defendant)" sues you for. In other words "Know the game before you play it". If your facts are solid and your intents are true, all I can say is best of luck on your endeavors.

[MatrixWatch]

I have heard this said before, and with all due respect to you and your opinion, you really do not know what you are talking about. Whenever anything is said about EzExpo that falls outside of what the lawsuit has stated, I preface those statements with the necessary conditions. It is not a crime to state and emphasize what the lawsuit has already brought forth. This is the purpose of matrixwatch.org, to inform people about the lawsuit, its allegations, and possible reprocussions. I have steered clear of all the personal bashing, and I think that as people read through the forums they see other people bashing Shelby, and onlookers attribute that to me. Here is my response to a few of the things you said:

Furthermore, Watchdog will have to prove in court that he didn't purchase from the site with the intent to turn around and sue them for his unjust enrichment.

This allegation is not only untrue, it goes against the very spirit of what you are trying to say. You have said that it is wrong to accuse someone of something that has not been proven, yet here you are accusing me of something that I have not even been sued over. This will not be addressed in the court case because it is a red herring. My motives for buying into the matrix has nothing to do with the fact that EzExpo is in court for illegal business practices. The courts will rule out whether or not these allegations are true, not try to investigate motives.


Mr "Watchdogs" allegations and his publicising them has placed a loophole in Ezexpo's defense whereby the plaintiff has knowingly and unlawfully damaged a company's name without an official court ruling of his/her/their allegations.

What do you mean by "loophole"? What loophole? What you would need to prove is that EzExpo incurred damages from this site. How will you do that? I have been running a poll on the home page and most of the voting members say it is either pay processor freezes, eBay crackdowns on info selling, or flaws in the matrix idea itself. EzExpo has received two negative-media waves from MSNBC, and many other people on their own forums attest that it was the conduct of the owner that sealed its fate.

Such actions may be deemed slander or libel and could warrant a counter suit against the plaintiff. Therefore Watchdog, it is important to note in all your public correspondence that these claims are actually allegations rather than factual.

All I have said that was factual was that EzExpo is being sued. I then went on to talk about the lawsuit. I could not be sued for slander because I would have to verbally injure them. I will not be sued for libel (written slander) because I clear my statements through lawyers and stick to the issues in the case. Now, if you want to talk about libel... I have screen shots saved on disk where Shelby calls me, my lawyer, and Bob Sullivan of MSNBC "Idiots". I have other screen shots of him typing out more insults as well. THAT is libel.


In conclusion, it is also important to note that Penal Codes have conditions. One condition of the entire article constituting Mr Watchdogs allegations bases itself on the "Company's" intent to deceive its customers. Failure to prove this intent may prove even more detremental to your case.

Please tell me the what article you are referring to. The lawsuit is not based upon EzExpo's intents to deceive. It mentions this, just as it mentions that EzExpo is a modern-day pyramid scam, but the case does not rest upon this. What are you talking about, "Failure to prove this..."? Have you read that section of the lawsuit? Their terms and conditions are quoted, as well as their statements elsewhere on the sites. This is not even a cloudy issue to the opponents of the case, and I am confused why you would say that not proving it would be "detremental".


If your intention with this case is to stunt the defendants business, and you fail to prove all conditions required to win your case, you may find yourself in deep trouble when your case is over. The "defendant" may on his/her/their terms counter sue you and you may be liable for punitive damages 3 times that of which the "Plaintiff (former Defendant)" sues you for.

I just have no idea where you got this. And where does your "3 times" figure find its base? Please, refer to where you got this information from. My intention is not to stunt the defendants business. As it relates to EzExpo, I don't want to "stunt" them, I want them to shut down and refund everyone's money if they are ruled by the courts to be an illegal lottery. They run a business that will mathematically break down if it hasn't already, and the people are joining with hopes that will never be delivered upon. They support their members who use smoke and mirror tactics on eBay and elsewhere to manipulate people into joining the lists. We may not be talking about a legitimate business here, we are talking about an alleged modern-day pyramid scheme that sells ebooks as its cloak of righteousness.

[dappa219]

Mr. "Watchdog", as your rebuttal to my post reflects, you are operating under the impression that your case is cut and dry.

1. I noticed that you did not address the part of my post that mentions your past intent to purchase EZexpo.

2. In the defense of this case, I would aim to disqualify the plaintiff allegations by showing their intent in the case (especially in your case since you were obviously aware of HOW the system works and were still interested in purchasing the business). REMEMBER, the other side of your law suit has a right to defend by any means necessary.

3. Note: I never once in my post "accused" you of purchasing with intent to sue, I merely stated that while presenting your case in court you may have to defend yourself against such an allegations (in light of your past interest in the company of coarse).

4. You state that I would have to prove that EZexpo incurred damages from this site. Your question was "How would I do that". The answer may be simpler than you think. I can argue that your publicizing this site has had an adverse affect on the reputation and normal operation of Ezexpo's business. Furthermore, I could argue that your post do not suggest allegations but rather implied ruled illegal activity.

5. Calling someone an idiot does not necessarily constitute slander because of the relative definition and conception of the word.

6. If you read my post in its entirety you will note that I said "Penal Codes" have conditions. Again you are operating under the impression that all laws are cut and dry. They are not. What I did was note a condition in the inherent ambiguities of the UCL.

7 (and final point). The 3x figure is not a law, it is taken from the historical outcome of such cases involving restitution. The figure may may significantly less but traditionally not more. So I guess I should apologize for not saying "Up to 3 times".

P.S Do not contradict your post:

I could not be sued for slander because I would have to verbally injure them. I will not be sued for libel (written slander) because I clear my statements through lawyers and stick to the issues in the case.

When you turn around and conclude your post with this;


They run a business that will mathematically break down if it hasn't already, and the people are joining with hopes that will never be delivered upon. They support their members who use smoke and mirror tactics on eBay and elsewhere to manipulate people into joining the lists. We may not be talking about a legitimate business here, we are talking about an alleged modern-day pyramid scheme that sells ebooks as its cloak of righteousness.


I do not know everything about california laws but I did do a case study on the UCL and if I practiced in California I would without a doubt defend this case on a pro-bono basis.

[MatrixWatch]

Thanks for the quick reply. I'll number my answers to match the numbers of your questions.

1. Because it is irrelevant

2. It may be how you do things, but there are no grounds to prove any of these accusations.

3. I am not worried about this at all. I have not done anything wrong, and have nothing to hide.

4. Why do you keep talking in the first person when you talk about legal defence? Are you their lawyer? Could you ARGUE this point? Yes. Could you PROVE it? No.

5. I just changed my mind when I read this point. There is no way you are a lawyer. Read through my last post on slander and libel.

6. Please rephrase this to really answer what I asked you.

7. I accept your apology. Please tell me the names of the cases that led to your "historical outcome".

P.S. That latter concluding statement was a paraphrase of what the lawsuit has already stated. In fact, the lawsuit starts off stating this. Please read it again and ask whatever questions you would like. Just to let you know however, I am not an attorney and will have to defer to my attorney's expertise and the court's rulings. We are just going to have to wait and see what the court does but there is very good reason to be optimistic.

[dappa219]

In the same order:

1. Whats good for the goose may be bad for the gander. In this case vise versa. What you deem as irrelevant may be a very good loophole in defense.

2. Grounds may be drawn (without ANY regards to relevance-although ti may be something to fish with) from 1.

3. End point.......Beyond scope of topic and makes not accusations.

4. I am NOT their lawyer. Could I argue this point....Yes...could I porve it.......It may be something to fish with. You have no idea what a laywer can prove.

5. LOL....No comment

6. End point...You failed to see my intent with this one. No questions were posed nor any accusations made. I did read the documentations of the suit. Allegations and their relative proof are a totally different wilderness.

7. Why are you fishing on this point. Do you expect to lose this case? Do not be intimidated. This point is irrelevant if your case is strong.

A P.S. to your P.S. Even If it is "Alleged" in the case documentation....your conclusive re-phasing of this may consitute grounds on libel without formal ruling.

Oh and P.S. I am a lawyer :)

Very young one..but knowlege liberates and ignorance enslaves. Have a good day and good luck.

[dappa219]

P.S to P.S. to P.S.

Sorry for the typographical errors......

[MatrixWatch]

Thanks dappa. It was a great conversation. I wish you the best of luck in your field of law. I'm sure you will have a fabulous carreer. As new issues arise, feel free to come over to the site and catch up. :)

[hurley9192]

I believe the term you guys are looking for is "Piercing the Corporate Veil"

If the owner acted with gross negligence and scienter, which he appears to have done, then you can "pierce the corporate veil" and go after the owner. That's so that people can't run corporations that are illegal and stay behind the corporate image and free of liability.;)

Hope this helps.

Also, these pay systems have known for awhile that they are accepting payments on behalf of a ponzi scheme. I emailed paypal 2 months ago and got a refund for www.rsient.com, which is another scam site. I told them it was a ponzi scheme and should be shut down.

We'll see where this goes. Looks like the Nike golf clubs on ebay thing is dwindling. Type in "nike irons 45" into the search function on ebay. There are only 5 auctions left down from 59 this weekend. Let's see if we can end the rest of them.

[MatrixWatch]

If you have the auction URL's you can put them in our "eBay Watch Dogs" sub-forum. They'll get on it right away.

[virology76]

This is all very interesting reading, especially this thread where people that are obviously very intellegent make very good points in well worded posts. It is rare to see intellegent talk on a message board! What I am wondering about is the drive that some of you have to 'protect future investors'... What the hell is that? I bought into EZ Expo in December of last year. I paid $25 for the laptop before it became $50. When I did this I thought of it as an investment, an investment with some risk. It is just like the stock market to me, investing in a stock that has the potential to pay out big, but also has the risk of eating my investment. Many people have seen that happen in the stock market, and no one ever complains about it. People who make risky investment are adults with brains. They choose to take the risk for their own reasons, and should not expect to get paid back if the stock tanks. They know this and they still invest... this is where I think I was at when I bought in. At the time, new people where joining the matix I was in at a very fast pace, so I was excited. Then things started to slow down. I really don't sit around and think about the $25 I spent because it is not that much money. I know that some people bought in for a hell of a lot more, and that is their mistake. I chose to start small because of the risk involved, some people were not quite as cautious... I don't expect my Laptop or my refund, but if I get it that is great! It just seems lame to me that some many of you are trying so hard to 'protect future investors'. Not to say that you are personally lame, but that the efforts of our society to repay people for their lack of common sense is truely stupid. People should have known that the matrix was a risk, any adult with a functioning brain should have known that. Too often we allow people to be idiots because there is always the wonderful court system to protect them! And you know that the lawyers are out to protect you as well... give me a break.
What do I expect out of the lawsuit: amusement. This is all. The way that the lawyers and courts work, we will all be lucky if the case ever gets going. And forget about seeing any meaningful refund from the settlement. The lawyers will get most of what is left after the product vendors get their share.
As I said, I do enjoy all of the posts! You all seem very smart and are able to word things very well. Most entertaining to read the debate- keep it up!

[MatrixWatch]

Virology,
I've read through about three of your posts so far, and you seem to always address the issue of people's responsibility, and their need to realize risk. I would recommend that you read through both the lawsuit, and this entire thread, as this issue has been addressed before. Here is a recap: The whole subject of whether or not people should reckon a risk or not before buying into the matrix is a red herring. A "red herring" is something that is brought into an argument to distract it from the main issue(s). The issue here is that the matrix sites cannot be run legally and still make money. They would need to allow an entry into the matrix for free, without the necessity of an e-book purchase. Yes, the stock market has its risks as well, but the NYSE, NASDAQ, etc. are registered markets, matrix sites are not registered lotteries. I have seen many people attempt to liken a matrix site to a state lottery, or a casino. These are false analogies. Lotteries and casinos are granted the rights by the government to operate as such. They are granted this opportunity, even though there is risk involved, because they have established certain required controls in their system. This will enable the people to take a gamble if they wish, but not be defrauded. The matrix sites have a problem in this area. You purchased your $25 into the matrix knowing full well that you were taking a risk. That is okay. But did you know that the matrix sites had questionable practices that warranted negative attention from the press? Did you know that the pay companies caught onto it and began freezing accounts? Did you know that many matrix-site owners are putting false names onto the lists to cycle money into their own pockets? Now, tell me this: Would you have still bought into the matrix if you know that your money would be frozen, and that you probably wouldn't even be able to take the risk you set out to take. I don't think you, or anyone else for that matter, would answer yes to this.

[peterdragin]

Ok But with the stock market you have the chance by watching how the stock is doing, and if it looks like it is losing points, you dump it, and lose some money, but not all of it.

But with a Maitrx you have no control over your investment, if you see a site that is in the process of failing you can't do a thing about it, but just watch your money go Bye Bye..

So a stock investment is not a good comparison to use.

[virology76]

I am sorry for not being clear... I don' really think that matrix sites are like the stock market, that is just how I saw it when I bought into EZ. The stock market is legal because the government says it is, OK this is true. What if the courts say that the matrix concept is legal? Not that I think this will happen, but just a hypothetical question. Legality is defined by the majority opinion in our society...
The issue with calling the matrix site a lottery is also interesting... As far as I understand it, the current lawsuit against EZ is being brought in the Peoples Republic of Kalifornia, is that correct? They have a law against lotteries not run by the state (a law no doubt designed to allow the state to make all the money, not to protect consumers). Are all states like this? Could EZ be open to attack in other venues? What about the rumor I hear that EZ is now offshore? Would this not protect them the same way that it protects online casinos, porn sites, file-sharing servers? What if EZ for example were to get permission to be a lottery, to sell e-books in exchange for an entry into a drawing? A drawing whose chances depended on the number of entries, just like any other contest, but backwards? And what about those other contests, was it Publisher's Clearinghouse that allowed you to enter into their contest by purchasing magazine subscriptions... Just rambling here, but I do think that this is a complex issue, despite many people's attempts to make it sound cut and dry. I lookforward to hearing some thoughts on this post!

[MatrixWatch]

Virology,
I think the best thing you could do right now is read through the lawsuit. It is not very long, and it spells out a few answers to your questions. Also, read though this entire thread. It is a little long, but many of the questions you raised are answered here. If you do this, your questions will reach a greater depth and this will benefit this forum as a whole. Thank you for your involvement here at Matrix Watch, and I look forward to reading more of your questions.

[Arzel]

Virology,

Legality is not defined by majority opinion. Laws are defined for what is in the best interest of the our society as a whole. One of the main priciples behind a democratic republic government (what we have) is representation and protection of the minority opinion.

The courts are in place to interpret the law without prejudice.

You make an interesting point regarding off shore casinos and gambling. This is still a gray area, but I did read today that all online gambling may very well be deemed illegal in the US. Many of the large Nevada casinos have recently abandoned their attempts to set up online gambling sites. I would link the story, but I can't seem to find it right now. We will probably hear more about this over the next few months though.

As for publisher's clearinghouse (along with all national promotions like the McDonald's Monopoly contest) alows anyone to enter for free. In the publisher's clearinghouse contest most of the winners have not bought subscriptions.

[MatrixWatch]

well said.

[virology76]

Arzel-

The laws of this land are, for at least the major stuff, defined by what most people feel to be moral or immoral. For example, things like murder, rape, theft, etc... are deemed to be wrong by most people, and are therefore illegal. Abortion is a hot issue that also mirrors this behavior. Ever since Roe v. Wade, abortion has been legal. If a majority of people in this country begin to feel that abortion is wrong (which I think may be coming), then you can bet that eventually it will become illegal. The common path for this would be for the country to continue to elect conservative presidents and congressmen, and eventually the supreme court would be in a position to overturn Roe. Not to say that I agree or disagree with this, but this is one case where majority opinion could very well change or create laws. Gun control is another issue that could be decided based on majority opinion, and we could end up like England or Australia, with no private ownership of guns and out of control crime. This would go down in the same scenario as stated above, and in this case I sure hope that it does not. Of course the issues in this forum are much less vital, but these examples are IMHO the ways that majority opinion controls law and morality.
it is true that the democratic/republic model is designed to protect the minority, but it is also designed to give as much weight to the majority. I guess in my opinion the majority is more important in a lot of cases, and as I have indicated in previous posts, I feel that our government and society has begun to spend entirely too much energy protecting very small minorities, at the expense of the majority. To use the example once again of gun control- gun registration is designed to deter gun use by criminals, however the illegal use of legally bought guns is a small minority compared to the vast majority of legal gun owners. This is a good example of how laws designed to affect a minority often end up being a hassle to the majority, while having virtually no effect of the intended target.

[Arzel]

Virology,

I must give you credence to parts of your post, but I still stand by my conviction of the basic framework of a democratic republic.

You are correct in that the majority does hold great influence over many of the laws in our land but let us examine further our government.

Take, for example, the great states of California and North Dakota. California has approximately 34,000,000 residents. North Dakota has approximately 650,000 residents. California has 53 house seats and 2 Senators. North Dakota has 1 house and 2 Senators.

This works out to roughly 650,000 people represented by a House member for both CA and ND, but in CA each Senator represents approx. 17,000,000 people, but in ND each Senator represents about 325,000 people.

Now I think it is fair to say that the minorty population of ND hold equal say as CA when it comes to creating laws in the US particularly in the Senate. Our forefounders knew that if they did not devise a system such as this the more populous states would be able to impose their will on the less populous rural states.

One only needs to examine the many agricultural laws in our nation to see that they are in place to protect the minority farming population.

If you look at our country as a whole you will see that the Senate is elected by a minority of the population, and therefore our laws are held in balance by the minority (the house, rulled by the majority, is the other balance).

[MatrixWatch]

And in addition to this, the illegal lottery laws set forth in California law, and in the laws of many other states, are designed to protect consumers from fly-by-night organizations. If this law were not in place then all we would hear is, "The customers are at fault because they did not read my ultra-fine-print Terms of Service!" In fact, just because a company has a customer agree to a terms of service, it means absolutely nothing if that company is violating the law. The customer could sign an agreement a hundred times over, yet if that agreement was against the law in the first place, then the owner of the company cannot use those Terms of Service against the customer.

[poorme]

The matrix agreement is unfair and is intended to take advantage of customer????