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(1.) Whether a temporary restraining order or preliminary injunction are "orders"that are to be given full faith and credit under the Uniform Enforcement of ForeignJudgment Act (A.R.S. §§12-1701 etseq.);

Michael K. Jeanes, Clerk of Co t*** Electronically Filed ***

Lori CummingsFiling ID 419002

9/9/200910:16:04 AM

1 Angel "Bacha" Vega #023036DODGE & VEGA, PLC

2 4824 E. Baseline Rd., Suite 124Mesa, Arizona 85206

3 Telephone: (480) 656-8333Facsimile: (480) 656-8334

4 bachorq)dodgevcga law.com

5 Attorneys for Plaintiffs, Respondents, NEDRA RONEY McKELL, ROBERT McKELL

IN THE SUPERIOR COURT OF THE STATE OF ARIZONA

IN AND FOR THE COUNTY OF MARICOPA

GARY WHITING, an individual, et aI.,13

Defendants, Petitioners.

Judicial Assignment:The Honorable Karen Potts

9 NEDRA RONEY MCKELL, and ROBERTMCKELL, husband and wife,

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Case No. CV2009-093004

Plaintiffs, RespondentsMEMORANDUM OF POINTS ANDAUTHORITIES RE TRO,PRELIMINARY INJUNCTION ANDFULL FAITH AND CREDITvs.

Pursuant to the Court's ruling and Minute Entry Order of September 1, 2009,

Plaintiffs Rob and Nedra Roney McKell, by and through counsel Dodge & Vega, PLC,

hereby file their Brief on Enforcement of an Order of a Foreign Court.

INTRODUCTION

This matter came before the Court on Defendant Gary Whiting's Motion for

Emergency Hearing and Stay of Enforcement of Foreign Judgment on September 1, 2009.

After oral argument, the Court requested additional briefmg on the issues of:

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(2.) Whether a temporary Receiver order is subject to the Uniform Enforcement ofForeign Judgment Act; and

(3.) Whether Defendant's argument that the Utah Temporary Restraining Order wasobtained by fraud could be entertained in this Court.

Plaintiffs submit the following in response to the Court's request for additional

briefing.

BACKGROUND FACTS

1. On August 3, 2009, Plaintiffs filed their First Amended Complaint and Motion

for Temporary Restraining Order in the Fourth Judicial District Court of the State of Utah.

See Transcript of August 21,2009 hearing at p.ll, attached as "Exhibit A."

2. At that time, Judge Claudia Laycock set a hearing date for the Motion for

Temporary Restraining Order for August 21,2009. See Id.

3. On August 10, 2009 and August 11, 2009, all defendants named in the Utah

action were served with the First Amended Complaint and Motion for Temporary

Restraining Order. See Id. at p. 13-16.

4. On August 21,2009, Judge Claudia Laycock of the Fourth Judicial District, State

of Utah, held a hearing on Plaintiffs' Motion for Temporary Restraining Order.

5. Defendants' counsel, Gary Henrie appeared for the limited purpose of requesting

a continuance of the hearing so as to permit additional time for Defendants' Arizona counsel

to be admitted pro hac vice. Id. at p.4.

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6. Judge Laycock considered the arguments presented by counsel and denied the

motion to continue the hearing based on the fact that all Defendants had been properly

served and the motion for a continuance was filed just prior to the hearing. Id. at p.18-19.

7. Based on the uncontested allegations made in Plaintiffs' motion, the Court

granted Plaintiffs Motion for Temporary Restraining Order. Id. at p.29

8. Judge Laycock also appointed a Receiver to take control of and preserve the

companies. Id. at p.24-27.

9. Plaintiffs filed this order with the Arizona Superior Court, Maricopa County on

August 24,2009, prompting Defendant Gary Whiting's pending motion.

ARGUMENT

I. A TEMPORARY RESTRAINING ORDER IS A JUDICIAL PROCEEDINGTHAT WARRANTS FULL FAITH AND CREDIT UNDER THEUNIFORM ENFORCEMENT OF FOREIGN JUDGMENTS ACT

In Jones v. Roach, the Court of Appeals of Arizona, Division One, Department B

reviewed the enforcement of a Colorado judgment in the Arizona courts. 575 P.2d 345

(1977). The Court was asked to determine whether a foreign judgment was subject to

collateral attack under Ariz. R. Civ. P. 60(c). The Court deliberated the purpose of the

Uniform Enforcement of Foreign Judgments Act (A.R.S. §§ 12-1701 et seq.) and determined

that "inherent in any discussion of A.R. S. §12-1702 is that it is only final judgments of a

sister state that are entitled to full faith and credit." 575 P.2d at 348. The Court relied on

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the Restatement 2d. Conflict of Laws §J07 and cited Comment (e) to this section to qualify

this reading ofthe Full Faith and Credit Clause of the Constitution. Comment (e) states:

It is for the local law of the state of rendition to determine whether a judgmentis fmal.

Under this analysis, it is necessary to determine whether a "Temporary Restraining Order"

is considered "final" under the Utah Rules of Civil Procedure. See Grynberg v. Shaffer, 165

P.3d 234 (Ariz. App. 2007).

Rule 65A of the Utah Rules of Civil Procedure requires that any restraining order

issued under the Rule shall be binding on those against whom the order is issued. See Utah

R. Civ. P. 65A(d). [emphasis added.] This language demonstrates that it is a final

adjudication as to the merits of seeking the restraining order. In other words, the order itself

is a final order dealing with the restraints placed on the Defendants. While the order may

later be replaced by an injunction, the order stands on its own accord directing the parties to

refrain from certain conduct and it is the law of the case.

Accordingly, Utah considers a temporary restraining order to have the finality

necessary to receive full faith and credit under the Uniform Enforcement of Foreign

Judgments Act. See Garris v. South Alabama Production Credit Assoc., 537 So. 2d 911

(Ala 1989) (Appellant seeking "final order on his application for temporary restraining

order."); Ford v. Alabama By-Products Corp., 392 So.2d 217 (Ala 1980) (Final order

denying petition for temporary restraining order); Boyd v. Ottman, 961 So.2d 148 (Ala.

Civ. App. 2006) (final order granting a restraining order to last 10 years); Birch Creek

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Irrigation v. Prothero, 858 P.2d 990 (Utah 1993) (appeal of the grant of a preliminary

injunction as a final order of the trial court).

"Full faith and credit" as referred to in definition of "foreign judgment" (including

orders) in Uniform Enforcement of Foreign Judgments Act, refers to full faith and credit

that is required by Constitution of United States, U.S.C.AConst. Art. 4, § 1, and means

that full faith and credit must be given to judicial proceedings of sister state ... "

Multibanco Comermex, S. A v. Gonzalez H. (App. Div.2 1981) 129 Ariz. 321, 630 P.2d

1053.

Because the Utah order has been properly filed in Arizona, and as provided by law

defendant has twenty (20) days to provide this Court evidence of its appeal or other actions

in Utah preventing the enforcement of the Utah Order, Arizona at this time is not

authorized to entertain a motion for relief from judgment to avoid the enforcement of the

Utah order; "to do so would not afford finality to the rendering state's judgment and

would be contrary to the full faith and credit clause ofU.S.C.AConst. Art. 4, § 1." Jones

v. Roach (App. Div.l 1977) 118 Ariz. 146, 575 P.2d 345.

II. THE UTAH DECREE OR ORDER IS NOW A DECREE OR ORDER OFTHE ARIZONA COURT.

In keeping with Arizona case law, and the Uniform Enforcement of Foreign

Judgments Act, a foreign judgment authenticated in accordance with an act of Congress

or the statutes of Arizona can be filed with the clerk of any superior court; it is then

treated as a judgment of that court. For what constitutes authentication see Rule 902,

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procedures, defenses, and proceedings as are local judgments. Phares v. Nutter (1980)

Ariz.R.Evid. The Act defines a "foreign judgment" as a judgment, decree, or order of

any court of the United States or any other court entitled to full faith and credit in

Arizona. A.R.S. § 12-1701. [emphasis added.] Foreign judgments are subject to same

125 Ariz. 291, 609 P.2d 561. [emphasis added.] Accordingly, the Utah order carries the

same force and effect as if it were an order signed by a local judge, say for example,

Judge Kongable.

For instance, A.R.S. 44-3292 grants Arizona courts the ability to enter restraining

orders and temporary injunctions in cases dealing with securities violations. Should an

order of this nature be entered by Judge Kongable (to continue our example) this Court

would not be entertaining defendant's motion. Pursuant to well established Arizona law,

the Uniform Enforcement of Judgments Act shall be "interpreted and construed as to

effectuate its general purpose to make uniform the law of those states which enact it."

See ARS 12-1707.

Given that a foreign order has been entered, and by definition is a foreign judgment,

should defendant not present this Court with a notice of appeal from the issuing

jurisdiction this Court must give full faith and credit to the order and present law of the

case.

The issue of granting full faith and credit to a temporary restraining order has been

reported in only a few cases. In Gutierrez v. District Court for County of Adams, 516 P.2d

647 (Colo. 1973), the Colorado Supreme Court did not reach the merits of the Full Faith and

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no reason to hesitate to enforce the restraining order in that case.

Credit clauses application to temporary restraining orders. However, the trial court found

Utah, however, treats restraining orders with the binding finality of a final order;

therefore, this Court must grant the Utah temporary restraining order full faith and credit in

this matter. Whether a rendering state's judgment is final must be determined under the

local law of the state of rendition. Jones v. Roach (App. Div.1 1977) 118 Ariz. 146, 575

P.2d 345.

ID. THE APPOINTMENT OF A RECEIVER UNDER RULE 66 OF THE UTAHRULES OF CIVIL PROCEDURE IS NOT A TEMPORARYAPPOINTMENT

At the August 21, 2009 hearing, Judge Claudia Laycock determined that the relief

requested by Plaintiffs was inappropriate. Specifically, Judge Laycock indicated that the

Rules of Civil Procedure did not allow for the appointment of an interim president. Judge

Laycock did, however, determine that the appointment of a receiver was appropriate under

Rule 66(a)(I) given the nature of the allegations against Defendant Gary Whiting. See

Exhibit A, p. 24-27. Judge Laycock then altered the order by hand-writing a brief line

stating "Vick Deauvono shall also act as Receiver under Rule 66 of the Utah Rules of Civil

Procedure for each ofthe above-listed entities."

This order is separate from the TRO and from the appointment of Vick Deauvono in

each of the named capacities. Rule 66 does not contemplate a temporary status of an

appointed receiver. Therefore, given the appointment, and Judge Laycock's order, this

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order is fmal and warrants full faith and credit under the Uniform Enforcement of Foreign

Judgments Act.

IV. A FOREIGN JUDGMENT MAY ONLY BE COLLATERALLY ATTACKEDAND THE MERITS OF THE CASE CANNOT BE REACHED EXCEPTTHROUGH AN APPEAL IN THE RENDERING JURISDICTION.

Foreign judgments entered into the State Courts through the Uniform Enforcement

of Foreign Judgments Act (A.R.S. §§12-1701 et seq.) are subject to the same procedures for

vacating a judgment as judgments of the Superior Court of this State. Springfield Credit

Union v. Johnson, 599 P.2d 772 (Ariz. 1979). Rule 60(c) of the Arizona Rules of Civil

Procedure provides for judgments to be set aside for mistake, newly discovered evidence,

fraud, misrepresentation or other misconduct of an adverse party, the judgment is void, the

judgment has been satisfied, or any other reason justifying relief from the judgment.

Defendant Gary Whiting has claimed that Plaintiffs committed fraud on the Utah court in

obtaining their order. Defendant Whiting has, however, failed to produce any evidence

whatsoever of any fraud. He disputes the uncontroverted statements made by Robert

McKell, Vick Deauvono, and Brent Barton in support of Plaintiffs' motion for a temporary

restraining order, but demonstrates no extrinsic fraud on the Utah court.

"The burden of proving fraud is on the party moving to vacate, and is not to be

presumed, but must be established by clear and convincing evidence." Lake v. Bonham,

716 P.2d 56,58 (Ariz. App. 1986). In Lake, the trial court vacated a judgment after fmding

that, in spite of his sworn affidavit to the contrary, Mr. Lake was not domiciled in Arizona

as required in order to obtain a decree of dissolution. The appellate court found that the trial

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court had no legal basis under Rule 60(c)(3) for vacating the decree because the evidence

was insufficient to support the fraud claim. The Court cited 2 C. Wright & A. Miller,

Federal Practice and Procedure, §2860 (1973) in determining that:

The cases in which it has been found that there was or might have been a'fraud upon the court,' for the most part, have been cases in which there was'the most egregious conduct involving a corruption of the judicial processitself.' The concept clearly includes bribery of a judge of or the employmentof counsel in order to bring an improper influence on the court.

Lake, 716 P.2d at 58.

In the present matter, Plaintiffs have brought, in good faith, three affidavits

supporting their allegations against Defendant. These affidavits corroborate one another

and set out a detailed outline of the improper actions taken by Defendant Whiting in

converting business assets for his personal use. Defendant Whiting's claim of "fraud on the

court" under Rule 60(c) requires clear and convincing evidence that Plaintiffs have engaged

in conduct that involves the corruption of the judicial process itself. Absent such a showing,

Defendant Whiting has no basis to vacate the order as entered in Utah and as domesticated

in Arizona under the Uniform Enforcement of Foreign Judgments Act.

CONCLUSION

Plaintiffs have obtained a valid final judgment on their motion for a temporary order.

Plaintiffs' temporary restraining order is a judicial proceeding that warrants the full faith

and credit guaranteed by the United States Constitution and by the Uniform Enforcement of

Foreign Judgments Act.

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Judge Laycock's order appointing Vick Deauvono is a final order. The nature of

Rule 66 of the Utah Rules of Civil Procedure does not contemplate a temporary order, but

rather appoints Mr. Deauvono indefinitely or until further action taken by the Court. Mr.

Deauvono's status as court-appointed receiver, therefore should be granted full faith and

credit under the Uniform Enforcement of Foreign Judgments Act as it is a final order.

Accordingly, Plaintiffs pray the Court to grant full faith and credit to the Temporary

Restraining Order and the Order Appointing Vick Deauvono as Receiver for the reasons

stated. Plaintiffs also pray the Court to dismiss Defendant Whiting's allegations of fraud

and to deny Defendant Whiting's Motion to Stay Enforcement ofthe Foreign Order.

RESPECTFULL Y SUBMITTED this 8th day of September, 2009

DODGE & VEGA, P.L.C.

By: /s/ Angel "Bacho" Vega #023036Angel Bacho Vega4824 E. Baseline Road, Suite 124Mesa, AZ 85206ATTORNEYS FOR PLAINTIFFS

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ORIGINAL of the foregoing hand delivered/filed with:

The Honorable Karen PottsMaricopa County Superior Court

COPY of the foregoing sent via email thiss" day of September, 2009, to:

Gregory G. McGill, P.C.4421 N. 75th Street, Suite 101Scottsdale, Arizona 85251Attorney for Defendantsgregmcgilli!ilcox.net

B. Ray ZollMicah BrunerB. RAY ZOLL P.c.8941 South 700 East, Suite 204Sandy, Utah 84070Counsel for Plaintiffs (Utah)m ic alVei)brun e rS.11et

By: /s/ Angel "Bacho" Vega #023036

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B. Ray Zoll, #3607Micah Bruner, #11272B. Ray Zoll, PC8941 South 700 East, Suite 204Sandy, Utah 84070Telephone: 801-545-7663Facsimile: 801-545-7910

Attorneys for Plaintiffs

IN THE FOURTHJUDICIAL DISTRICT IN AND FORUTAH COUNTY, STATE OF UTAH

GARY WHITING! an individual;CHEYENNEMOUNTAIN JudgeENTERTAINMENT/ INC., a Nevadacorporation; GARVICK PROPERTIES,LLC, a Nevada limited liabilitycompany; CHEYENNEMOUNTAINGAMES, INC., a Nevada corporation;MMOGULS, INC, a Nevadacorporation; NOW CORPORATION, aNevada corporation

NEDRA RONEYMCKELL1 anindividual; ROBERT MCKELL, anindividual,

Plaintiffs,

vs.

Defendants.

STATE OF UTAH }:55.

COUNTY OF UTAH }

AFFIDAVIT Of VICK DEAUVONOIN SUPPORT OF PLAINTIFFS'

MOTION FOR TErViPORARYRESTRAINING ORDER

Civil No.

The undersigned, being first duly sworn, states as follows:

1. I am over the age of 18 and am competent in all respects to testify in thisAffidavit of Vick Deauvono Page 1 of 9

matter.

2. I have personal knowledge of all statements to which I am herein

attesting with the exception of those statements, which are based upon

information available to me, and the belief I have reached based upon

that information. As to those statements I verily believe them to be true.

3. I became involved with Gary Whiting and Mmoguls, Inc. when I met with

a group of potential investors and principals.

4. In that meeting we, as a group, decided that we would create Mmoguls,

Inc. as an incentivized gaming network marketing company through

which customers would pay to play online computer games and have the

opportunity to create a network through which a customer could be paid

by encouraging others to sign up with Mmoguls, Inc.

5. At that time, Gary Whiting also owned CheyenneMountain Entertainment,

Inc. ("CME") and its subsidiary, Cheyenne Mountain Games ("CMG").

6. CME and CMG partnered with Mmoguls to provide Mmoguls with video

game content for MMoguls subscribers.

7. CMEpresently owns the license to develop a massive multi-player online

role-playing game based on the Stargate® franchise. The game will be

entitled Stargate Worlds.

8. Mmoguls, Inc. was designed to be the company through which CMEwould

market the Stargate Worlds video game and make It available to the

Affidavit of Vick Deauvono Page 2 of9 .

public.

9. Despite the other online games provided by CME and CMG, Stargate

Worlds video game was/Is essential to the viability and stability of

Mmoguls, Inc. as a company.

10. During that initial meeting, Gary Whiting nornlnated Brent Barton as the

CEO,due to Mr. Barton's extensive experience running network marketing

companies.

11. Upon filing the lnltlal paperwork, I discovered that Gary Whiting's credit

was insufficient to gain the necessary funds and accounts for starting the

company.

12. Vision Bankcard, the credit card processor that was to be used by

Mmoguls, Inc. in processing affiliates' credit cards, ended up placing its

business reputation on the line In order to secure the necessary funding

and accounts to start Mmoguls, Inc.

13. Gary Whiting stated that Mr. Barton would have control over the

company, that Mr. Barton would have complete control over and accessto

the finances, and that there would be an executive committee to act as an

oversight board for the company.

14. Before the Stargate Worlds video game was finished, we launched the

company and immediately saw significant numbers of affiliates sign up to

participate in the network marketing aspect of the company.

Affidavit of Vick Deauvono Page 3 of9

15. Within the first month of launching, Mmoguls, Inc. brought in

approximately $900,000.00.

16. This money was to pay for the commissions earned by affiliates as well as

operating costs of the company.

17. Brent Barton requested approximately $400,000.00 to pay the earned

commissions and operating costs of the company.

18. Vision Bankcard released the money to the accounts authorized by Gary

Whiting.

19. Brent Barton and Gary Whiting began writing checks from the Mmoguls,

Inc. account to pay the commissions earned by Mmoguls affiliates.

20. I discovered that the checks that Mr. Barton and Gary Whiting had signed

were bouncing due to Insufficient funds in the Mmoguls, Inc. account.

21. After discussions with officials at Vision Bankcard and Brent Barton, I

learned that Gary Whiting had transferred the money from the Mmoguls,

Inc. account to his own personal accounts and that the money had been

used for Gary Whiting's personal use.

22. In all, Gary Whiting took at least $350,000.00 from Mmoguls, Inc.

unbeknownst to anyone else, including the CEO, Brent Barton.

23. I was in a meeting, after I discovered that Gary Whiting had taken

Mmoguls, Inc. money for personal use, with potentIal investors in

Mmoguls, Inc. and Stargate Worlds when I overheard a conversation

Affidavit of Vick Deauvono Page 4 of 9

between Jeff Knowles of Vision Bankcard and Gary Whiting.

24. From that conversation, I learned that Gary Whiting asked Jeff Knowles

for additional funds from the Vision Bankcard account In order to pay the

commissions that were due the affiliates.

25. Due to this self-dealing by Gary Whiting, the majority of the management

of Mmoguls, Inc. left the company taking with them extensive experience

in and knowledge of the network marketing arena.

26. These former employees, including former CEO Brent Barton, have

created a new multi-level marketing company called ManDelis, which

employs a business model almost identical to Mmoguls wherein MonDelis

offers distributors the ability to play videogames online with the option of

earning money by getting other players to sign up for the program. This

business directly competes with Mmoguls.

27. From the creation of Mmoguls, Inc., the concept was to provide affiliates

and Mmoguls, Inc. members with the ability to play vldeogames with the

potential to earn money from playing the games.

28. Another of Gary Whiting's companies, Cheyenne Mountain Entertainment,

obtained the licenses, raised the money from investors, and created the

studios necessary to create the Stargate Worlds videogame.

29. Cheyenne Mountain Entertainment was then to market the game in part

through Mmoquis, Inc.'s Incentivlzed social network contained in its online


Entertainment, along with many of those involved in the actual creation of

the qarne, to resign and leave the game stalled.

38. Throughout the entirety of the creation of these entities and pursuit of the

Stargate Worlds videogame, Gary Whiting maintained complete control

over Mmoguls, Inc., Cheyenne Mountain Entertainment, Cheyenne

Mountain Games, Stargate Worlds, and all other related entities.

39. Gary Whiting has delusions of grandeur and has, single-handedly, lead to

the decline of the entire Mmoguls, Inc. business plan.

40. Through discussions with various individuals, I have learned that MGM is

currently reviewing the I1censingfor Stargate Worlds issued to Cheyenne

Mountain Entertainment.

41. It is my understanding that Cheyenne Mountain Entertainment stands to

lose its license from MGM unless Cheyenne Mountain Entertainment can

show that it has the funding, personnel, and management necessary to

finish building the game.

42. Through my extensive business experience, it is my opinion that Gary

Whiting's continued involvement and management of Cheyenne Mountain J.

Entertainment will likely cause MGM to lose faith in the license granted to

CME.

43. WIthout the license for Stargate Woridsl Cheyenne Mountain Games,

Cheyenne Mountain Entertainment and Mmoguls will not maintain the

Affidavit of Vick Oeauvono Page 7 of 9

viability necessary to pay its obligations or to make money.

44. Without the license for Stargate Worlds, the entire money making

opportunity of Mmoguls, CME and CMG will have disappeared.

45. The loss of license would cause Immeasurable harm to each of these

entities.

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This space left intentionally blank,


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46. Based on my expertence, and my knowledge of what Whiting has done to

this company, if he continues to serve in any capacity in the company,

Mmoguls, Inc. Cheyenne Mountain Entertainment, and Cheyenne

Mountain Games will each fail.

fURTHER AFFIANT SAYETH NOT.

Dated this. __ d.eli\' of July 2009.

VickD ,

VERIFICATION

STATE OF UTAH ):ss

COUNTY OF )

Vick Deauvono, being first duly sworn upon his oath deposes and says:That he has read the foregoing Atfldavlt, that he knows the contents thereof and thesame are true of his own knowledge, except as to those matters therein stated upon hisInformatIon and belief and as to such matters he believes them to be true.

SUBSCRIBEDand SWORNTO before me this ~day of July 2.009.


FRO I" :

-.--- .._-_.---- - . ..- - -.--------.----- ..-.~.~-~-.~~..--..-.-.------ - -.- -..-----~----..- ----~.-~..~~..~- ",".

Aug. 20 21309 i~: 54PI'1 PiFRX HO. :4805322440

Gary R. Henrie #50833518 N. 1450 W.Pleasant Grove, Utah 84062Telephone: (702) 616~3093E·mw!: [email protected]

•Attomey for Defendants

IN THE FOURTH JUDICIAL DISTRJCT COURTUTAH COUNTY, STATE OF UTAH

NEDRA RONEY MCKELL anindividual; ROBERT MCKELL, anindividual,

Plaintiffs,

vs.

GARY WHITING, an individual;CHEYENNE MOUONT AlNENTERTAINMENT, INC" a Nevadacorporation; OARVICK PROFERTIES. LLC,aNevada limited liabilitycompany; CHEYENNE MOUNTAINGAMES. INC., a Nevada corporation;MMOGULS, INC. a Nevadacorporation; NOW CORPORATION, aNevada corporation.

Defendflllts.

AFFIDAVIT OF GARY WHITING INSUPPORr OF DEFENDANTS' MOTION

FOR CONTlNUANCE OF HEARING .

Civil No. 09040243&

Judge Laycock

STATE OF ARIZONA ).ss

COUNTY OF MARlCOPA )


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1. I am over the age of 18 and am competent in all respects to testify in this matter.

2. I have personal knowledge of all statements !O which I am herein attesting with

the exception of those statements, which are based upon information available to me, and the

belief r have reached based upon that information. As to those statements I verily believe them

to be true.

3. I formed MMOOULS, INC., a Nevada corporation ("MMOGULS"). It was the

direct result of my ideas. my money and my efforts. MMOOULS hired Brent Barton to be its

first CEO and President several months after I created MMOGVLS. When Brent Barton

resigned his positions, MMOGULS hired Don Carroll as its CEO and President who continues to

serve today.

4. Upon leaving M1\10GULS Brent Barton establish and operates today a company

almost identical to MMOGULS and that competes directly with MMOGULS. 1 was shocked to

learn about this COUP. because Vie: Deauvono and Jeff Knowles had agreed to oversee the

operations of business after they convinced me to move the offices for MMOGULS from Mesa

Arizona where I live to Jeff Knowles offices in Orem Utah. I was never even on-site after the

move and Vie, Rob, and Jeff were all on-site and in control oftbe day •.to-day management of

MMOGULS and worked directly with Brent Barton. After Brent Barton stole my ideas, my

business and all the employees and clients of MMOGULS, 1moved the offices back to Mesa

Arizona and hired Don Carroll as President.

5. After this move baok to Mesa, Jeff Knowles and Vie Deauvono both threatened

we implying that they would stop collecting money through credit cards if I didn't let them have

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the company. 1 told them it was my company and would not let them steal it from me. Jeff

Knowles misrepresented to me that he would only keep 20% of the credit card processing if 1

would let him process credit cards for MMOGULS and my other company Stargateworlds (a

video game company.) I Made the loan with Rob McKell based on that promise. Once we signed

with Jeff Knowles, he told me that he was going to keep 50% of the funds. This meant that I

could not pay anyone, because the commissions to the MMOGULS downline was 50%. As a

result of this misrepresentation, 1 had to borrow money to pay for operational costs during

February and Maroh. Jeff Knowles theft threatened me saying that he would shut off unless I met

his demands. He then started keeping 100% of the money and I had to borrow money to pay

overhead and commissions.

6. Don Carroll, the current President and CEO is a seasoned business man and came

to MMOGULS with skills and experience commensurate with managing a substantial business

enterprise. Don has been running the company and helping me raise additional money to keep

paying for overhead and commissions. He personally has lent the company money to do this.

7. Ido not have regulnr litigation counsel for representation in the State of Utah. T

am seeking to retain counsel and have identified and talked with a person who will likely

represent me and the other Defendants. However, he has not had rime to review this matter on

short notice and is tied up all day on the date of the pending hearing. Mr. Henrie has agreed to

represent the Defendants for the purpose of requesting a continuance of the hearing.

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FURTHER AF !ANT SAYETH NAUGHT.

ISTATE OF ARlZONA

VERIFICATION

).ss

COUNTY OF MARICOPA )

Gary Whitin,a. being first duly swornupon his oath deposes and says: that he has read thefQregoifig Affidavit, that he knows the contents thereof and the same are true ofhis 0\\111knowledge, except as to those matters therein stated upon his information and belief and as tosuch matters be believes them to be true.

SUBSClUBED AND SWORN to before me this 20fh day of August) 2009.

"

JEFFREY K WllUAMSON.

NOTA.RY PUBLIC - ARIZONAMARICOPA COUNTY

• My Commlsllion ExpiresJanua 2011

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',~<-~(HEYENNE~ ~IVIOUNTAINIi' E N T E R T A I N M E M T

August 13, 2009

To whom it may concern:

Based upon the books and records of the company as of August 1, 2009, Cheyenne MountainEntertainmentr Inc. and its subsidiaries ('CME") shows that it received approximately$2,919,016.71 from Garvick Properties, LLC form December 1, 2008 through March 31, 2009.A detail of the payments as follows:

Funds Received from Garvick Properties LLCDate Amount

Wednesday, December 03, 2008 $ 39,500.00Wednesday, December 10, 2008 $ 60,000.00Thursday, December 18, 2008 $ 249,470.51Friday. December 19, 2008 $ 16,112.56Wednesday. December 24, 2008 $ 11,250.00Wednesday, December 31, 2008 $ 32,683.64Monday, January 05, 2009 $ 333,000.00Friday, January 09,2009 $ 15,000.00Tuesday, January 27, 2009 $ 840,000.00Tuesday, February 24, 2009 $ 620,000.00Wednesday, March 04, 2009 $ 500,000.00Wednesday, March 04, 2009 $ 182,000.00Friday, March 13,2009 $ 20,000.00

Total $ 2,919,016.71

If you have any questions, do not hesitate to contact me at (480) 656-6501.

4140 East Baseline Road, Suite 208 ¢ Mesa, AZ 85206phone: 480-656-6500 o fax: 480-555-6565¢ www.cheyenneme.com ¢ www.stargateworlds.com

5

Justin D. Heideman (Utah State Bar #8897)Brandon G. Wood (Utah State Bar #10307)

2 ASCIONE HEIDEMAN & MCKAY, LLC3 2696 North University Avenue., Suite 108

Provo, Utah 846034 Phone: (801) 812-1000

Fax: (801)374-1724

6 Associated through local counsel:

7 DAVIS MILES, PLLC8 P.O. BOX 15070

MESA, AZ 852119 Telephone: (480) 733-6800

Fax: (480) 733-374810

Attorneys for Defendant Ann Colson

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flLEO

08 M~1 \ '2 Pt'\ ,,~30

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STATE OF ARIZONA

MARICOPA COUNTY SUPERIOR COURT

14 i15 !I GARY WHITING, an individual,16 I

I Plaintiff,17 !

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vs.18 ,

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19 ! ANN COLSON, an individual; CHICAGO1 TITLE AGENCY OF ARIZONA, INC., an

20 I Arizona Corporation,

2\ I Defendants.

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CASE NO. CV2007·011672

S~RTOAMENDEDCOMPLMNTD AMENDED COUNTERCLAIM

(Assigned to the HOD. Sam J. Myers)

24COMES NOW Defendant Ann Colson ("Defendant" or "Colson"), by and through

undersigned counsel, and submits the following Answer to Plaintiff's Amended Complaint.2S

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DEFENDANT COLSON'S AMENDED COUNTERCLAIM

COMES NOW Defendant and Counterclaim ant, ANN COLSON ("Colson"), and

counterclaims against Plaintiff and Counterclaim Defendant, Gary Whiting ("Whiting"), as follows:

1. Colson incorporates the allegations and denials of the foregoing Answer into this Amended

Counterclaim.

2. The causes of actions asserted herein arise out of the same transaction or occurrence alleged

in Plaintiffs Amended Complaint. As such, venue and jurisdiction are proper.

3. Shortly after Colson and her husband, Nick Colson (''Nick''), married in 1997, they met

Whiting while attending church.

4. Colson, Nick and Whiting became good friends, as did their families.

5. Colson, Nick and Whiting thereafter engaged in various business endeavors together.

6. In approximately 2000, Colson began working as an assistant or secretary to Whiting in

several businesses in which Whiting had ownership and which Whiting was managing.

7. During this time, Whiting held himself out as a trustworthy, dependable friend with

Colson's best interest in mind.

8. Given the parties many years of church and business relationship as well as their close

friendship, Whiting had made himself into a person of trust for Colson and her children.

9. Beginning in late 2005, while Colson was experiencing some marital problems as well as

problems between her children and Nick, Whiting told Colson that said problems were evidence

that Nick did not love Colson and encouraged Colson to move out.

10. Whiting also told Colson that he felt Colson was to become a spouse to Whiting, even

though Whiting was married, and encouraged Colson to leave Nick.

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11. In approximately May 2006, partly due to Whiting's urgings, Colson moved out of the home

where she and Nick were living and entered a "rent-to-own" contract on a home located at 5407

East Catalina Avenue, Mesa Arizona, 78251 (the "Catalina Home") and began making

rent/mortgage payments on the home.

12. Whiting continued to insist Colson enter into the spousal arrangement with him and

encouraged her to divorce Nick.

13. Whiting represented that if Colson agreed to said spousal arrangement, he would purchase

the Catalina Home for Colson, Colson could live there for as long as she wanted, Whiting would

provide Colson with monthly support and maintenance payments of at least $3,000.00, and Colson

would not work.

14. Whiting represented that if at any time after entering the foregoing arrangement Colson

decided to opt out of the arrangement, she could keep the Catalina Home and he would pay her a

$100,000.00 severance payment.

15. During this time, Whiting assisted in making rental/mortgage payments on behalf of

Whiting on the Catalina Home.

16. In September 2006, due to Whiting's insistence and in reliance on his representations,

Colson agreed to Whiting's proposal, except that she insisted she would continue to work as

Whiting's secretary rather than quit her job, to which Whiting assented.

17. At the time, Colson was making $3,000.00 per months working for Whiting's businesses.

18. Colson paid the legal expenses for Colson's divorce from Nick, which was finalized in

September 2006, and Whiting began making arrangements to purchase the Catalina Home for

Colson.

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19. In the process of preparing to purchase the Catalina Home, World Savings Bank informed

Whiting that neither he nor his business entities qualified for any additional mortgages, as he had

already obligated his business on several other mortgages in 2006 for homes he had purchased for

other women entering into the same or a similar type of arrangement as Colson.

20. For the same reasons, neither Whiting nor his business entities could qualify for a mortgage

on a home Whiting was simultaneously wanting to purchase for Ms. Lynette Williams

("Williams"), located at 1508 South Chestnut Circle, Mesa Arizona 85204 (the "Chestnut Home").

21. In order to purchase the Catalina and Chestnut Homes pursuant to his arrangements with

Colson and Williams respectively, Whiting devised a plan to circumvent the fact that neither he nor

his entities qualified for additional mortgages.

22. Whiting transferred $100,000.00 into Colson's personal account in order that Colson qualify

for mortgages for the purchase of the Catalina and Chestnut homes.

23. At Whiting's instruction, Colson applied for the mortgages and was approved.

24. At the closing of the Catalina Home, Whiting instructed Colson to pay approximately

$63,590.18 as a down payment on said Home from the foregoing $100,000.00, which she did.

25. World Savings Bank paid the remaining balance due to consummate the transaction and

issued a mortgage in Colson's name in the amount of$206,800.00 for the remaining balance.

26. Closing on the Catalina home was consummated on October 16,2006 (See Exhibit A

herein)

27. At the closing of the Chestnut Home, Whiting authorized the transfer of$125,000.00 from

one of his business entities as down payment and earnest money toward the purchase of said Home.

28. World Savings Bank overpaid the remaining balance by $16,387.20 to consummate the

transaction on the Chestnut Home, issued a mortgage in Colson's name in the amount of13

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$185,250.00 for the amount of the loan, and refunded Whiting's business the overage of

$16,387.20.

29. Thus, total funds contributed by business entities owned by Whiting toward the purchase of

the Chestnut Home were $108,612.80.

30. Closing on the Chestnut Home was consummated on October 13, 2006 (See Exhibit B

herein)

31. The deeds to both the Catalina and the Chestnut Homes were issued in Colson's name, as

were the mortgage obligations on both homes.

32. Whiting made payments for a couple of months, on the Catalina Home through February

2007, and on the Chestnut Home through march 2007.

33. In the fall of2007, Whiting had engaged a new woman in a spousal arrangement ("Mary").

34. Shortly after this arrangement, Whiting started treating all of the other partners differently

and stopped paying them support and wanted Ann Colson to quit her employment so he could stop

paying her.

35. As a result of Mary's actions and Whiting's changed behavior, Williams approached

Whiting's religious leader and informed him of the arrangements that Whiting had with these

several women.

36. Whiting's religious leader approached Colson and asked her to confirm the allegations of

Williams.

37. Colson confirmed the allegations.

38. When Whiting found out about Colson's confirmation to his religious leader, he promptly

fired her from being his personal assistant, which position she had held for the past 12 years.

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39. Because Whiting was making no payments on either Catalina or Chestnut Home after March

2007 and and because he has fired Colson, Colson was forced to borrow money to try to make

mortgage payments in her name.

40. Colson could not refinance because she had no money and no job.

41. She did not have the support of her husband, as she is divorced.

42. Colson asked Williams help pay since Williams was living in Chestnut Home and was for

her benefit per Williams' arrangement with Whiting.

43. Williams makes no payments

44. Colson makes repairs to Chestnut home and files forcible detainer action so she can get

renters in to make payments.

45. Chestnut Home goes into foreclosure because Whiting not making payments according to

his promises, Williams making no payments, and Colson has no ability to continue paying.

46. Colson's utilities turned off at the Catalina Home. She borrows more money to pay to keep

get her utilities back on.

47. Whiting at some point in all this files the present quiet title Action.

48. As Whiting's assistant, Colson had done the work for the arrangements Whiting had entered

into with other women, prior to Colson entering the arrangement and seen Whiting performing on

his promises to the other women.

49. Colson relied on Whiting's representations to her based on her observation and experience

of the other women.

50. Whiting generally had the women entering the arrangement with him sign a purported

contract.

51. Neither Colson nor the other women were given a copy ofthis contract.15

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52, Colson did not sign anything until after she had been fired by Whiting at considerable

pressure from Whiting.

53. Whiting has provided Colson via supplemental initial disclosures in this action a purported

"LLC Partnership Agreement" with Williams.

54. On information and belief, the terms of this purported agreement are the terms in the other

written agreements Whiting had the women sign.

55. Notwithstanding the terms, as shown below, Whiting had promised Colson the terms

aforementioned in this Amended Counterclaim.

56. On information and belief, Counterclaim Defendant Gary L. Whiting ("Whiting"), a married

man, has entered into numerous LLC Partnership Agreements with several single women. In these

agreements, Whiting provides housing, financial support, and a "commitment of time and emotional

support on a non-exclusive basis, as Whiting has other partnership interests to pursue and

maintain." (See "LOF NUMBER FIVE, LLC PARTNERSHIP AGREEMENT", purportedly

executed by Whiting and Williams, attached hereto as "Exhibit C", for an example of such an

agreement).

57. In exchange, the women maintain the property and form a "consortium" and "a fidelity

relationship" with Whiting. (See "LOF NUMBER FIVE, LLC PARTNERSHIP AGREEMENT",

attached hereto as "Exhibit A").

58. Moreover, Whiting represents to the women that the home is theirs and that they are free to

withdraw themselves from the LLC Partnership Agreement with Whiting and take everything

provided to them by Whiting, including specifically but not limited to equity in the home

theretofore paid.

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59. Several, and possibly all, of Whiting's partners divorced their husbands in order to enter into

these arrangements with Whiting.

60. Upon information and belief, Whiting had entered into at least three of these agreements,

and therefore had provided at least three houses to four single women, previous to any agreements

with Colson and Williams.

61. Whiting therefore devised a plan to obtain two more homes in which to house his two

newest "partners".

62. Whiting has made demands for the property to be transferred to him via quiet title, even

though mortgages are in Colson's name and she is responsible for the monthly payments and he

refuses to assume the mortgages himself.

63. In divorcing her husband, entering into the LLC Agreement, and having the properties

purchased in her own name, Colson was relying on Whiting's representations that he would pay the

mortgages and provide her with any and all funds necessary for her support.

64. Colson indebted herself $5,583 to make payments on the Chestnut home and pay its

property taxes before not being able to make any more payments thereon.

65. Colson expended the following on the Chestnut home to make it marketable to renters or a

new buyer, given Williams was not paying nor was Whiting, and Colson's credit was being

destroyed for nonpayment:

a. At least $\,300 in repairs,

b. $3,000 charges to Lowes

c. $600 labor to rip out tile and paint the home.

d. $1,000 in unpaid utilities and reconnection fees

66. Colson has lost her job of$3,000 per month as of January 2007.17

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67. She has been working for only a couple months and makes at most $1,000 per month now

and is going to school.

68. She has nearly $400 thousand dollars of debt to her name with interest accruing very rapidly

thereon.

FIRST CAUSE OF ACTION(Breach of Contract)

69. Counterclaim Plaintiff Colson incorporates and re-alleges all previous paragraphs as though

fully set forth herein.

70. Whiting and Colson entered into a contract with substantially the same as those found in

Exhibit A, in which Whiting promised to provide housing and financial support in exchange for

Colson's maintenance of the Catalina property and a fidelity consortium with Whiting.

71. Colson divorced her husband in order to enter into this arrangement with Whiting.

72. Colson performed her part of the contract by maintaining the Catalina Property and

consorting with Whiting.

73. Whiting has now ceased providing support and maintenance payments to Colson.

74. Colson has been damaged by not receiving the fruits of her contract.

75. Whiting and Colson also entered into an oral contract in which Whiting would provide

funds to Colson sufficient to obtain mortgages to purchase both the Chestnut and Catalina

properties; in exchange, Colson would transfer the properties to Whiting once the mortgages were

paid off.

76. Colson performed her part of the contract by obtaining the properties and the respective

mortgages.

77. Whiting partially performed by making several months worth of payments.

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_78. Whiting ceased making payments on the mortgages, which action was inconsistent with the

agreement between Whiting and Colson.

79. As a result, Colson has been required to pay the mortgage payments through her meager

means, even being required to take out loans in order to meet the payments.

80. Colson has attempted to mitigate the damages by trying to obtain funds by requesting

Williams-to pay rent for occupying the Chestnut property.

81. Wherefore, Counterclaim Plaintiff Colson asks this Court for damages as deemed

appropriate.

SECOND CAUSE OF ACTION(Breach of Covenant of Good Faith and Fair Dealing)



83. When Whiting and Colson agreed to obtain the Chestnut and Catalina properties pursuant to

Whiting's plan, Colson assumed very few risks associated with the transaction.

84. Whiting suddenly stopped all payments on the mortgages, causing Colson to assume far

greater risks than Colson had justifiably expected.

85. Colson and Whiting had also entered into a contract under which Whiting would provide

Colson with payments of money to be used for her support.

86. Whiting has ceased making support payments owed to Colson under the LLC Partnership

Agreement.

87. Whiting's actions are preventing Colson from receiving the benefits and entitlements of

both of the agreements entered into.

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88. Wherefore, Counterclaim ·Plaintiff Colson asks this Court for damages as deemed

appropriate.

THIRD CAUSE OF ACTION(Fraud in the Inducement)


6fully set forth herein.

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90. Whiting represented to Colson that he would make the mortgage payments on the Chestnut

and Catalina properties and that the properties would stay in her name until such time as the

mortgages had been completely paid off.


appropriate.

FOURTH CAUSE OF ACTION(Negligent Misrepresentation)



93. When Whiting and Colson agreed to obtain the Chestnut and Catalina properties pursuant to

Whiting's plan, Whiting represented to Colson that


purchased in her own name, Colson was reasonably relying on Whiting's representations that he

would pay the mortgages and provide her with any and all funds necessary for her support.


appropriate.

FIFTH CAUSE OF ACTION(Fraudulent Misrepresentation)

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purchased in her own name, Colson was relying on Whiting's representations that he would pay the

mortgages and provide her with any and all funds necessary for her support.


appropriate.

SIXTH CAUSE OF ACTION(promissory EstoppellDetrimental Reliance)



100. In the case the Court finds no contract was entered into, Whiting should be estopped

from not performing his promises to Colson.

101. When Whiting and Colson agreed to obtain the Chestnut and Catalina properties

pursuant to Whiting'S plan, Whiting represented to Colson that he would pay all the monthly

payments and that the properties would stay in her name until they mortgages were paid off.

102. Colson reasonably relied on Whiting's promise, and followed through Whiting's

plan until Whiting stopped making the monthly mortgage payments

103. In divorcing her husband, entering into the LLC Agreement, and having the

properties purchased in her own name, Colson was relying on Whiting's representations that he

would provide her with a home and funds necessary for her support.

104. Colson has sustained damage to her credit and finances, and has needed to take out

loans to meet the monthly mortgage obligations.

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LOF NUMBER FIVE, LLCPARTNERSHlP AGREEMENT

This Partnership Agreement (hereinafter Agreement), effective this lst day ofSeptember, 2006, is by and between Gary L. Whiting and/or any entities he owns orcontrols, (h(:reinafier "Whiting") and Lynette Williams, (hereinafter "Williams"), andcollectively known as the Parties. This Agreemcrn is intended to »rotecr the interests ofMs. Williams and Mr. Whiting in connection with the possession, ownership and right toquiet enjoyment of 1508 South Chestnut Circle, Mesa, AZ 85204 (hereinafter "Chestnut"or "the property") as well as other aspects of~ile parties' rdations:lip which is entered 'into for valuable consideration and with full and mutual C(1OS~'1ltafter an opportunity for aconsultation with independent counsel.

\WHEREAS this Agreement is based upon the following:

A. The parties wish to formalize their business and partnersn:p relationship toestablish their respective partnership rights, obligations and responsible bondingin this Partnership, in particular with respect to each other's interest in theChestnut property and their partnership relationship. The Parties wish to enter intothis Agreement to address Issues of ownership, investment, possession andmanagement of the Chestnut property and their partnership relationship inconnection therewith.

B. The Parties wish to have this Agreement governed by the laws of the State ofArizona and governed pursuant to ARS Title 29 as well a:: applicable state andfederal decisional law.

AGR.EeMENT

NOW, THEREFORE, in exchange for valuable consideratior the receipt of which ishereby acknowledged. and in exchange for the mutual covenants, promises andconsortium recognized herein, the Parties agree as follows:

1. Recital~. The recitals are hereby incorporated into the Agreement,

2. Own..~. \"11iting shall have ownership ofthe Chestnut Property for thepurposes of investment. Further, given Whiting's professional demands on histime he cannot manage, supervise, maintain 01' upkeep th'~Property on his ownaccord. Whiting's ownership of Chestnut, wherein he will make the Propertyavailable for Williams to reside in, is Whiting~s capital omtriburion to thePartnership.

1·._ ....•...•.I ,...'"'~ UOI tlO

3. Management and Suoer:visi..Qn. In exchange tor Whiting's consent to allowWilliams (and her family ifdesired) to reside at Chestnut and have full rights ofpossession and quiet enjoyment for a twenty year period through June J, 2026(and an option to renew for another twenty year period), v/illiams agrees tomanage, supervise, maintain and upkeep the Property for 'N'hiting. In thisconnection Williams is obligated to maintain thelandscaping, ensure that thesprinkler system is in working order at all times, that all b'rshes and hedges aretrimmed, that all landscaping is kept with a neat and clean appearance. Further,Williams agrees to pay for needed repeirs to the property up to $250 per month.Further: Williams agrees that any and all problems or repairs at the Property thatexceed $250 per month shall be promptly brought 10 Whiling's attention in theevent Williams is unable to address, remedy and pay for the problem herself. Thisshall serve as Williams capital contribution to the Partnership.

4. Partnership Investment. Additionally, as a further capital contribution to thePartnership, Williams agrees ~,Jkeep \Vhitlng apprised of any potential buyers forthe Chestnut Property so that Whiting can optil;,izl~any sale opportunities in themarketplace, as Whiting does not wish to "list" Chestnut .or saie on the MLS.

s. ~C;:SI and Tax. Since Whiting will retain (ownership to Chestnutduring this Partnership and his capital contribution is to make the residenceavailable for Williams (and her family) to reside in. Whiting shall at all times pay,and be responsible for, any mortgages and other expenses associated with theChestnut Property, and Whjtin~ shall tile any and an stat~: or federal returns onthe Property.

6. William'!! Pro.fit or Buyout 00tiQil Rights. Accordingly, upon the sale of theProperty or upon Williams' request at any time in W31l1in ~ to dissolve thePartnership, this Partnership shall dissolve and at Williams' ejection, Whitingshall pay Williams $,50,000 in a lump !'UIII payment as a "buy out" price from thePartnership, or 50% of the profits (.f any such sale, in liei. of'a distrio\Jtion ofprofits and losses.

7. Responsible Bonding COE.ntlllt.!l. TIlis Partnership Agreement creaes aresponsible bond between Gary L. Whiting and Lynette Williams. which is a legaland lawful union between partners in 3 fidelity relationship with full and informedconsent. To consummate Whiting's responsible bond with Ms. Williams in thisPartnership, Whiting shall, as an' additional capital contrioution, mske a monthlymaintenance payment of 13,600 to 'NiiHarps to cover an)' upkeep or discretionaryexpenses.

8. Con1unction Not Fiduciary Relatjo~. The partners here in shall ne,t beconstrued as fiduciaries but shall be construed as a fideliy asscciatlon, tofacilitate the occupancy of the Property under a contract :If sale and to establish apersonal fidelity conjunction which will preserve and protect the integrity of this

artncrshlp. This partnership ussociatiou Includes ''\;"i''''8'' commitm~

.\--t--,...:;... Initials

and emotional support to the partnership on a non-exclusive basis, as Whiting hasother partnership interests to pursue 31'Id maintain.

9. Wrap /\roumW£atton-Whiting,f1Hg:IW~"1!!mt. This PartnershipAgreement is to facilitate a wrap around of an existillg Real Estate PurchaseContract between David J. and Ann K. Patton and Gary 'WhitinwlOF Number 5,LLC. for the purpose of providing occupancy and maintenance of the investmentproperty, 150R South Chestnut Circle Mesa, AZ 85204,

10. Separate Property Not CommuJ'lJ1.vPropertv. To the extent provided by law. GaryL Whiting. a married man, take'S his int-::rest herein as a separate prop en)' interestand not a community property interest. Lynette Williams, an unmarried woman,takes her interest as a separate prclpm'ty interest herein.

1]. Re1eEise~~nant Nor to Sue, A5 further consideration and an inducement toexecute this Agreement, and because Whiting is expressly assuming the financialburden of this Partnership Agreement, the Parties agree tc· release any claimsagainst the other in this Partnership and agree not to commenceany legalproceedings against the other. In tltis connection, Ms. Williams acknowledgesthat her rights herein are fully' and completely protected by the "profit or buyout"option referenced above in paragraph 5.

12. Rep:-E;~;ntatl(lns and W.MIa;:lti~.Ms. w:man"ls represents and warrants that whileshe is possession of the Property she will not Cause an}' liens, encumbrances orother instruments atl"ectil1g title to be r ccorded against the; ~ubj.;ct Property.

13. Severance and Blue Pen,,!,) R~, lf any tCI1TI, clause or provision of thisAgreement shall be held invalid, void, unenforceable or contrary to public policyfor any reason. then the remainder ·~fthe Agreement shall rernain in effect inaccordance with the Blue Pencil Rule.

14. Confidentiality. All information concerning this Agreemeru shall be held strictlyconfidential except as necessary to) enforce the terms of tais Agreement or asallowed or required by law,

1S. ~dYi~;cof Counsel. Whiting and Wi llinms each acknowl edge they have obtainedthe advice of their respective attorneys prior to executing; this Agreement (orwaived the opportunity to do so), and each patty executes this Agreement withfull knowledge of its significance and with the express lnrention of effecting itslegal consequences.

16. ],Dtegralion. This Agreement (which also expressly wrap; the prior.T'l.itton-WhitingPurd.c.!,c Contract) contains the!: entire ;:.l\retnlcnt bc'i:wet:)1 the Parrtes. It has notbeer. executed in reliance Oil th~ t.a~is <)i: any other oral (lr written representationsor t rns, and no extrinsic oral (It' written representations or terms shall modify,

or contradict the terms thereof. ~ /

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17. Choice a.nd Venue. This Agreement 1)"311 be construed under and according to thelaws of the state of Arizona, and any action or legat proceeding arising out of thisAgreement (or any tort, statutory or other claims}, sh a1lbe interpreted andenforced accordance with Arizona law and shall be hrougllt and maintained inMaricopa County, Arizona. Any federal court action (and any appeals to thefederal courts) shall be initiated it, the federal district court of Arizona,

18. Attome)!§ Fees. With respect tel any contract, tort, statutory or other claimsbrought to interpret. enforce, or defend this Agreement (or any claims or defensesthat are incidental to this Agreement), the prevailing part)' shall be entitledattorney's fees. eJ!:peJ1SCSand taxable CO.~Bincurred therein.

19. ~diilll. If Lynette Williams breaches th~ fidelity associaticn stipulations ofthis responsible bonding ~1g:·~t:1neat.Gary L. 'Whiting may elect either to continuethis responsible bonding agreement or he may send t. notice in writing to LynetteWtllisms that this agreement is breached and consequenrl f dissolved therebyinvoking the buyout stipulations under paragraph 6.

EXECUTION:

1HAVE READ THE ABOVE AGREEMENT, I HAVE TA!<.£N TIME TOCONSIDER ITS IMPLICATIONS, J FULLY UNDERSTAl'0 ITS CONTENTSAND J AOREE TO ITS TER.MSAND I VOLUNTARILY SUBMIT TO ITSEXECUnON AS INOICATED EY lvfY SIGNATURE BELOW~

___ ~ /l.~. ,," 20D(~ date

*f-* Gra-nted ***See eSignature Page

1 GREGORY G. McGILL, P.C.ATTORNEY AT LAW

2 4421 N. 75th Street, Suite 101Scottsdale, Arizona 85251

3 (480) 970-6720FAX (480) 970-6727

4 [email protected] G. McGill, No. 011020

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Attomey for Plaintiffs

SUPERIOR COURT OF ARIZONA

COUNTY OF MARICOPA

GARY WHITING, an individual,

Plaintiff,

vs.

ANN COLSON, an individual; CHICAGOTITLE AGENCY OF ARIZONA, INC., anArizona corporation; CHICAGO TITLEINSURANCE COMPANY,

Defendants.

LYNETTE WILLIAMS, an individual,

Plaintiff,vs.

ANN COLSON, an individual,

Defendant.

The COlU't,having reviewed the Stipulated Agreement ("Stipulated Agreement") dated

No. CV2007-011672CV2007-022735(Consolidated)

JUDGMENT

Michael K. Jeanes, Clerk of Court*** Electronically Filed ***


07/25/20082: 14:08 PM

(Assigned to the Honorable Sam Myers)

(Mandatory E-Filing)

July 23, 2008, entered into by Gary L. Whiting ("Whiting"), Plaintiff in Whiting v. Colson,

CV2007-011672, and Ann Colson ("Colson"), Defendant and Counterclaimant in the same

matter, and by Lynette Williams ("Williams"), Plaintiff in Williams v. Colson, CV2007-022735,

and Ann Colson, Defendant in the same matter, and good cause appearing;

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IT IS HEREBY ORDERED, ADJUDGED AND DECREED AS FOLLOWS:

1. That this consolidated case shall be placed on the inactive calendar for 120 days at

which time it will be dismissed with prejudice as to all parties unless a motion to set for trial is

filed herein.

2. That pursuant to the Stipulated Agreement there are four contracts which are valid

and in full force and effect, as follows: (1) the Cummings-Whiting contract (Catalina), (2) the

Patton-Whiting contract (Chestnut), (3) the Willi arns-Whiting (LOF No.5 LLC) contract, dated

9/1/2006 (Exhibit A attached to the Stipulated Agreement), and (4) an oral agreement between

Colson and Whiting, the terms of which are substantially similar to those contained in Exhibit A.

Further, for purposes of resolution herein, any purported contracts between Cummings and

Colson and/or between the Pattons and Colson are hereby ordered and decreed to be of no effect.

3. That Colson shall convey ownership to the Catalina property to Whiting, which

sale shall close on or before 90 days from this date. It is further adjudged and decreed that the

price shall be the outstanding and unpaid mortgage with World Savings Bank or assignee (the

"lender") plus routine closing costs and customary transaction costs, and title shall be conveyed

by Special Warranty Deed. Payment of the price for Catalina by Whiting and transfer of the

Catalina title by Colson ("Catalina Closing") shall take place simultaneously on or before 90

days from this date, i.e., by 10/23/2008,

4. That Whiting shall pay $50,000 to Colson in certified funds simultaneously with

the Catalina Closing.

5. That the title to Chestnut shall be transferred from Colson to Gary L. Whiting. It

is further adjudged and decreed that in order to effect said transfer in light of the pending

Chestnut foreclosure proceeding and the due on sale clause in the lender's deed of trust, Whiting

shall, within 90 days of the date hereof, provide sufficient funds to Colson to fully reinstate her

loan as to Chestnut. Whiting shall then acquire title to the Chestnut property from Colson by

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Special Warranty Deed for a price equivalent to Colson's outstanding and unpaid mortgage plus

routine closing and transaction costs. Payment of the price for Chestnut by Whiting and transfer

of the Chestnut title by Colson ("Chestnut Closing") shall take place simultaneously on or before

90 days from this date, i.e., by 10/23/2008.

6. That pursuant to the Stipulated Agreement and for purposes of this case the

contract between Whiting and Williams dated 9/112006 is a valid contract and in full force and

effect.

7. That neither Whiting, nor Williams nor Colson nor any assignees, agents,

affiliates, heirs and/or relations shall be liable for fraud or any other allegation of wrongdoing or

inappropriate conduct in connection with any of the above-referenced contracts or purported

contracts. Whiting, Williams and Colson shall each be forever discharged from any claims,

assertions or causes of action related thereto.

8. That neither Whiting nor Colson shall harass or contact the other party or

members of the other party's family; that and any restraining orders, protective orders,

injunctions against harassment or the like currently in effect against the other (or a family

member of the other) shall be withdrawn. It is further ordered, adjudged and decreed that Colson

shall not permit any property damage or waste to the Catalina property, which representation and

warranty shall extend to affiliates, relatives, or relations, ordinary wear and tear excepted. It is

further ordered, adjudged and decreed that Colson makes no representation or warranty that

Chestnut has not been damaged or subjected to waste because Colson has not been in possession

of Chestnut during the litigation.

9. That, pursuant to the Stipulated Agreement, the oral agreement between Whiting

26 and Colson shall be terminated upon entry of Judgment and satisfaction herein.

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10. That, pursuant to the Stipulated Agreement, Colson shall be fully responsible for

her representations and warranties that she has permitted no voluntary or consensual liens or

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deeds of trust to be placed on Catalina or Chestnut other than the World Savings Bank (or

assignee) mortgages referenced in the litigation and that to the best of her knowledge and belief

there are no involuntary or nonconsensualliens or deeds of trust on Catalina or Chestnut.

11. That there is no admission of liability by any party herein, and upon entry of

Judgment pursuant to the Stipulated Agreement herein, all claims and actions and potential

claims or actions that arise out of the same transactions and events that are the subject of the

Stipulated Agreement herein between Whiting, Williams and Colson, as well as their assignees,

agents, affiliates, heirs and relations, shall be dismissed with prejudice and forever discharged.

12. That Williams, Whiting and Colson shall each bear their own attorney's fees,

costs and expenses incurred herein.

13. This Judgment shall have res judicata and collateral estoppel effect upon

signature of the Court and entry with the Clerk. Pursuant to the agreement of Whiting, Williams

and Colson, there is no just reason for delay and this Judgment is accordingly being signed and

entered forthwith.

IT IS SO ORDERED, ADJUDGED AND DECREED.

DATED: _

THE HONORABLE SAM J. MYERS

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eSignature Page -- 241550749_SCAN0560_000.pdf

Granted

Signed on this day, July 25, 2008

/5/ Sam MyersJudicial Officer of Superior Court

B. Ray loll, #3607Micah Bruner, #11272B. Ray loll, PC8941 South 700 East, Suite 204Sandy, Utah 84070Telephone: 801-545-7663Facsimile: 801-545-7910

Attorneys for Plaintiffs

IN THE FOURTHJUDICIAL DISTRICT IN AND FORUTAH COUNTY, STATE OF UTAH

Plaintiffs,

AFFIDAVIT OF ROBERT MCKELL INSUPPORT OF PLAINTIFFS' MOTION

FOR TEr.JIPORARY RESTRAININGORDER

NEDRA RONEY MCKELL, an individual;ROBERT MCKELL, an individual,

vs.

GARY WHmNG, an individual; Civil No.CHEYENNE MOUNTAIN ENTERTAINMENT,INC., a Nevada corporation; GARVICK JudgePROPERTIES, LLC, a Nevada limitedliability cornpanv: CHEYENNEMOUNTAINGAMES, INC., a Nevada corporation;MMOGULS, INC, a Nevada corporatlon:NOW CORPORATION, a Nevadacorporation

Defendants.

STATE OF UTAH

COUNTY OF UTAH

)

):55.


1. I am the Plaintiff in this actIon.

2.. I am over the age of 18 and am competent in all respects to testify In this

matter.

3. I have personal knowledge of all statements to which I am herein

attesting with the exception of those statements, which are based upon

information available to me, and the belief I have reached based upon

that information. As to those statements I verily believe them to be true.

4. On or about January 7, 2009, I entered into a lvJasterAgreement with

Cheyenne Mountain Entertainment, Inc., Garvick Properties, LLC, SGW,

CMG, Mmoguls, Inc and Stargate to loan the entities $2,250,000.00 to

"kick off" the marketing for Mmoguls, lnc.

5. I loaned these companies $2,250,000.00 as agreed upon In the Master

Agreement along with an additional $550,000.00 in cash to pay for

various startup costs for Mmoguls, Inc.

6. As consideration for this loan, I was promised 30% of the gross revenue

received by Mmoguls, Inc., 5% of the gross revenue and income of the

other entities as a royalty, 5,000,000 shares of common stock of

Cheyenne Mountain Entertainment, Inc, as well as commissions due and

owing my downline in the Mmoguls, Inc Network Marketing compensation

plan.

7. Upon information and belief, Mmoguls, Inc. received Its initial gross

revenue of approximately $900,000.00 in March of 2009.

8. At that time, I was promised that, of the gross revenue received by

Mmoguls, Inc., I would receive 30% as agreed upon in the Master

Agreement.

9. To date, however, I have not received any return on my loan. I also have

never received any of the promised shares of common stock or any

money from the 5% of gross revenue promised me from all other entities.

10. Upon information and belief, Gary Whiting, president and owner of

Mmoguls, Inc., Garvick Properties, LLC[and all other entities party to the

Master Agreement, took the money generated as gross revenue for

Mmoguls, Inc. for his personal use.

11. I relied upon the promises made to me by Gary Whiting to loan

$2,800,000.00 to Mmoguls, Inc. and the other entities that the money

would be paid back to me out of the gross revenues received by the

entities.

12. My reliance on Gary Whiting's false statements have damaged me in that

I have yet to be repaid any part of the money I loaned these entities.

FURTHERAFFIANT SAYETHNOT.

Dated this 29 day of June 2009.

tB./t~~~tRobert McKell

VERIFICATION

STATE OF UTAH ):ss

COUNTYOF Salt Lake )

Robert McKell, being first duly sworn upon his oath deposes and says: That hehas read the foregoing Affidavit, that he knows the contents thereof and the same aretrue of his own knowledge, except as to those matters therein stated upon hisinformation and bellef and as to such matters he b~es themto be true.

~"t}-t' /!Zeft-i'!obert McKell

SUBSCRIBEDand SWORN TO before me this~day of June 2009.

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J, Michael K. Jeanes, Clerk of Co t*** Electronically Filed ***


9/11120094:27:04 PM

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Defendant sets out "Background Facts" seeking to undermine the validity of the

Utah Order. This attack is improper as the merits of the Temporary Restraining Order

("TRO") are not at issue before this Court. This matter is before the Court under the

Uniform Enforcement of Foreign Judgments Act (A.R.S. §§ 12-1701 et seq.).

1 Angel "Bache" Vega #023036DODGE & VEGA, PLC

2 4824 E. Baseline Rd., Suite 124Mesa, Arizona 85206

3 Telephone: (480) 656-8333Facsimile: (480) 656-8334

4 bacho((!)dodgevegaJaw.com

5 Attorneys for Plaintiffs, Respondents, NEDRA RONEY McKELL, ROBERT McKELL

IN THE SUPERIOR COURT OF THE STATE OF ARIZONA

IN AND FOR THE COUNTY OF MARICOPA

9 NEDRA RONEY MCKELL, and ROBERTMCKELL, husband and wife,

Case No. CV2009-093004

REPLY MEMORANDUM OF POINTSAND AUTHORITIES RE1. TRO;2. PRELIMINARY INJUNCTION;3. FULL FAITH AND CREDIT

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Plaintiffs, Respondents

vs.

GARY WHITING, an individual, et aI.,13 Judicial Assignment:

The Honorable Karen PottsDefendants, Petitioners.

Pursuant to the Court's ruling and Minute Entry Order of September 1, 2009,

Plaintiffs Rob and Nedra Roney McKell, by and through counsel Dodge & Vega, PLC,

hereby file their Reply Brief in support of Plaintiff's request that this Court enforce the

Order of the Utah Court.

DEFENDANT'S ARGUMENTS AGAINST THE VALIDITY OF THE UTAH

TEMPORARY RESTRAINING ORDER ARE IMPROPER

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Accordingly, Defendant's only venues of attacking this Foreign Judgment are set out

under Rule 60(c) of the Arizona Rules of Civil Procedure. See Springfield Credit Union

v. Johnson, 599 P.2d 772 (Ariz. 1979). Defendant's attempt to argue the merits of the

TRO, Plaintiffs' evidence whereby the TRO was obtained, and the findings of the Utah

court are misplaced in this forum. Had Defendant chosen to appear at the hearing held in

Utah, any allegations of impropriety, insufficiency, or validity of the evidence and the

final order could have been heard. Considering Defendant decided not to appear, except

insofar as Mr. Henry of Utah appeared to request a continuance five minutes before the

hearing was scheduled to begin, Defendant's arguments are inappropriate at this time.

The proper forum to attack the validity of the foreign order would be to seek

redress in the Utah courts.

THE TRO MEETS ALL REQUIREMENTS UNDER UT AM LAW

Under Rule 65A of the Utah Rules of Civil Procedure, the Temporary Restraining

Order ("TRO") meets all requirements necessary and would be honored by the Utah

courts as a final determination of the issue of whether a restraining order was necessary.

Contrary to Defendant's assertions, the TRO meets each requirement set out under Rule

65A. Starting on Page 27 of the Transcript of the TRO hearing, attached to Plaintiff's

initial brief as "Exhibit A," Judge Laycock carefully and specifically walked through

each element necessary to grant a TRO under Rule 65A.

She initially addressed the question of irreparable harm and found that, while the

money loss was measurable, "that there is other harm that is irreparable in the permanent

folding of this business." See Id. at p.28 (emphasis added).

After determining that all elements were met under Rule 65A, the Court turned to

the setting of a hearing date for the preliminary injunction. The Court indicated that it

would be difficult to set a hearing any time in the near future due to the fact that the

Court was beginning a nine-day civil bench trial on the following Monday that would

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capitalize the Court's calendar. rd. at p.32. Due to this reason, the Court extended the

length of duration of the TRO until the preliminary injunction hearing could be held.

MR. DEAUVONO'S APPOINTMENT BY THE COURT

AS RECEIVER WAS PROPER

Under Rule 65A, security is required unless the court determines that "none of the

parties will incur or suffer costs, attorney's fees or damage as the result of any wrongful

order or injunction, or unless there exists some other substantial reason for dispensing

with the requirement for security." Rule 65A Utah Rules of Civil Procedure. The Court

placed a Receiver over the companies so as to preserve their assets and to continue their

ordinary course of business. This appointment supplants any requirement for security as

the appointment of a Receiver, deemed neutral by the Court, prevents any party from

being damaged should the order be determined to have been improper in the Utah courts.

Vick Deauvono was explicitly deemed to be a neutral individual properly

appointed as a Receiver in this action. See Transcript on Hearing, p.26. Plaintiffs

presented the Utah court with sufficient evidence to persuade the court to appoint a

receiver. Judge Laycock specifically addressed the fact that Vick Deauvono had filed an

affidavit in support of the motion for temporary restraining order and found that his

affidavit was factual in nature, substantiated by the other affidavits filed, and did not

display any prejudice to the process or place any doubt in the court that he would act

properly to preserve the businesses and their assets. rd. Accordingly, Mr. Deauvono's

appointment was proper.

DEFENSE COUNSEL'S SPECIAL APPEARANCE IN UTAH WAS LIMITED,

INEXCUSABLY LATE AND UNINTELLIGIBLE

Judge Laycock explicitly stated that she had read all evidence presented to her by

the Plaintiffs. This included the memorandum and the three affidavits filed in support of

the memorandum. See Transcript of Hearing ps. 6 and 34. Judge Laycock also stated

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26 Estate of Page vs. Litzenburg, 177 Ariz. 84, 865 P.2d 128 (Az. App. 1993).

that she had not seen any paperwork from Defendant. Id. at p.3. At that time, Mr. Henry

presented the court with a copy of Defendant's Motion for a Continuance. The court

disregarded this document as it had not been filed with the court and due to the fact that it

was entered entirely too late in the process. Id. at p.18. Attached to this motion was

Gary Whiting's affidavit. This affidavit was entered as an attachment to the motion to

continue and, as was demonstrated by Mr. Henry's argument, that was the sole purpose

for which Defendant made any appearance at the hearing. Id. at p.2. Accordingly, as the

motion to continue was untimely filed with the court, nothing filed with the motion was

considered beyond the motion to continue.

The Utah court explicitly found that Defendant had been afforded sufficient time

under the Utah Rules to appear at the hearing. Id. at ps. 24-27. Accordingly, Defendant

had the opportunity to be heard at the TRO hearing but failed to take advantage of that

opportunity. Therefore, Defendant forfeited his right to be heard by failing to appear

other than to request a continuance a few minutes prior to the hearing commenced. The

consequences of waiver and forfeiture are common sense, even under Arizona authority,

in that defenses which are not raised timely, are deemed waived. Ariz. R. Civ. P., Rule

8(c). O'Keefe v. Grenke, 170 Ariz. 460, 825 P.2d 985 (App. 1992); Sirek v. Fairfield

Snowbowl, Inc., 166 Ariz. 183, 800 P.2d 1291 (App.1990); Hughes Aircraft Co. v.

Industrial Commission, 125 Ariz. 1,606 P.2d 819 (App.1979).

Moreover, Defendant fails to demonstrate in his brief any meritorious defense(s)

to the relief sought in the TRO. His burden, however, is even greater than simply

claiming a defense to obtain relief from [the order] based on allegations of adverse

party's fraud, misrepresentation, or misconduct, movant must have meritorious defense

which he was prevented from presenting because of adverse party's fraud,

misrepresentation or misconduct and misconduct includes even innocent omissions."

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Defendant's attacks on the judicial process in Utah are unfounded, untimely, and

improper in this venue. Defendant should have appeared at the Utah TRO hearing and

presented his positions to the Utah court at that time. Defendant's allegations of

invalidity and impropriety should be brought in the Utah courts insofar as they go beyond

the scope of Rule 60( c) of the Arizona Rules of Civil Procedure. This Court is the

improper venue for Defendant to now attempt to air these allegations and they should be

deemed waived.

THE TRO IS ENFORCEABLE IN UTAH AND HAS BEEN FULLY AND FAIRLY

LITIGATED AS TO THE PROPRIETY OF THE TRO

In Grynberg v. Shaffer, the Arizona Court of Appeals determined that an order

qualifies as final if it meets two requirements: (1) the judgment or order has to be on the

merits and enforceable and (2) the judgment or order in question must have been fully

and fairly litigated. 165 P.3d 234 (Ariz. App. 2007). The Court determined that "finality

attaches to a foreign judgment when it is issued by the trial court and is enforceable in the

issuing jurisdiction." Id. The TRO is enforceable in Utah, therefore its finality attaches

per the rule in Grynberg. But for the location of Defendant corporations in Arizona, the

court-appointed receiver would have been afforded any and all enforcement procedures,

including contempt proceedings against those defying the orders, so as to enforce Judge

Laycock's orders. Accordingly, the TRO is deemed a "final" order under the Grynberg

rule.

Defendant fails to demonstrate that the Utah TRO would not be regarded as a final

order in Utah. Defendant cites few cases, including an Arizona family law case and a

10th Circuit Court of Appeals case. In MacArthur v. San Juan County, 497 F.3d 1057

(10th Cir. 2007), the Court reviewed preliminary injunction orders of a tribal court of the

Navajo nation. The Court determined that "the preliminary injunction orders in this case

hardly constitute final judgments." Id. at 1066 (emphasis added). The limitation of the

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Court's determination to the orders in that case does not apply to our case. The Utah

court's TRO does more than merely ask for the status quo to be maintained, but supplants

Whiting in his capacity in Defendant Corporations. Therefore, MacArthur is inapplicable

to the facts of this case.

The Utah TRO is an effective instrument whereby the court's order appoints a

Receiver over these entities. Defendant Corporations have submitted themselves to Utah

jurisdiction through the Note and the Contract signed by the corporations and Plaintiffs.

This submission to Utah jurisdiction allows the Utah courts to handle matters involving

these parties. Accordingly, the Utah TRO is proper and is a final judgment under the

Uniform Enforcement of Foreign Judgments Act.

DEFENDANT HAS NOT MET HIS BURDEN OF PROOF

REGARDING FRAUD

Defendant has failed to demonstrate clearly and convincingly that the Utah TRO

was obtained through fraud. Lake v. Bonham, 716 P.2d 56, 58 (Ariz. App. 1986).

Defendant makes general allegations and highlights apparent issues of fact, but

Defendant has not demonstrated fraud. In order to demonstrate fraud, Defendant Whiting

must prove that Plaintiffs have abused the judicial process to the point of corrupting the

judicial process itself. Id. at 58. Instead of producing such proof, Defendant has merely

highlighted the fact that one of the affiants in support of the Motion for Temporary

Restraining Order is a competitor of Defendant Mmoguls. This alone, however, does

nothing to prove fraud in the instance ofMr. Barton's affidavit.

Defendant further claims that the TRO hearing was improper as Defendant claims

not to have been afforded the opportunity to be heard. The hearing was set and, as Judge

Laycock explicitly pointed out, all Defendants were properly served with sufficient notice

to appear before the Court. See Transcript of Hearing, ps. 24-27. Defendant failed to

take this opportunity to be heard except to have Mr. Henry appear on his behalf so as to

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request a continuance. Mr. Whiting's affidavit was attached to and was entered in

support of the Motion for Continuance. Considering the late filing of the motion and the

fact that Plaintiffs had gone above and beyond the notice requirements of Rule 65A, the

court did not grant Defendant Whiting's motion. This was after the Utah court had

considered Defendant's arguments and reviewed the facts of the case. Defendant's

failure to avail himself of the judicial process cannot and should not now be used against

Plaintiffs as they seek enforcement of the order that resulted from that hearing.

Defendant's attack of Judge Laycock's denial of the motion for a continuance is

improper in this Court and should be disregarded. Moreover, defendant is seeking relief

from an order after an unsuccessful appearance in Utah, which was completely flawed.

As such, defendant must establish not only a procedural justification for setting aside the

Utah order, but also that if the order were set aside, the party would be able to establish a

meritorious defense to the action. Master Financial, Inc. v. Woodburn. 208 Ariz. 70, 90

P.3d 1236 (App. 2004). In this case, Defendant clearly cannot do so.

EVIDENTIARY OBJECTION TO DEFENDANT'S MOTION

Plaintiff objects to the attachments included with Defendant's Memorandum

(untimely filed brief and attachments in Utah) and to any purported "affidavits" made in

support of the Motion to Continue in Utah as such evidence does not raise any viable

issues for modifying the Utah TRO and are otherwise irrelevant, inadmissible and or

hearsay.

Defendant has not produced any relevant authority and the circumstances offered

do not rise to a level which would justify staying the Utah TRO as Defendant must

demonstrate that by the use of due diligence, these facts and circumstances could not

have been discovered at the time of the hearing. Rule 60(c), ARCP.

/II

/II

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CONCLUSION

Plaintiffs have obtained a valid final judgment on their motion for a temporary

order. The Court's decision to grant the motion is final. Similar motions in other states

have been granted full faith and credit and Utah treats such orders as final for matters of

appeal. Plaintiffs' temporary restraining order is a judicial proceeding that warrants the

full faith and credit guaranteed by the United States Constitution and by the Uniform

Enforcement of Foreign Judgments Act.

Judge Laycock's order appointing Vick Deauvono is a final order. The nature of

Rule 66 of the Utah Rules of Civil Procedure does not contemplate a temporary order, but

rather appoints Mr. Deauvono indefinitely or until further action taken by the Court. Mr.

Deauvono's status as court-appointed receiver, therefore should be granted full faith and

credit under the Uniform Enforcement of Foreign Judgments Act as it is a final order.

Accordingly, Plaintiffs pray the Court to grant full faith and credit to the

Temporary Restraining Order and the Order Appointing Vick Deauvono as Receiver for

the reasons stated. Plaintiffs also pray the Court to dismiss Defendant Whiting's

allegations of fraud and to deny Defendant Whiting's Motion to Stay Enforcement of the

Foreign Order.

RESPECTFULLY SUBMITTED this 11th day of September, 2009

DODGE & VEGA, P.L.C.

By: /s/ Angel "Bacho" Vega #023036Angel Bacho Vega -4824 E. Baseline Road, Suite 124Mesa, AZ 85206ATTORNEYS FOR PLAINTIFFS

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ORIGINAL of the foregoing hand delivered/e-filed with:

The Honorable Karen PottsMaricopa County Superior Court

COPY of the foregoing sent via email this11th day of September, 2009, to:

Gregory G. J'1cGill, P.C.4421 N. 75t Street, Suite 101Scottsdale, Arizona 85251Attorney for Defendantsgregmcgi l!(Ci'lcox.net

B. Ray Zol1Micah BrunerB. RAY ZOLL P.C.8941 South 700 East, Suite 204Sandy, Utah 84070Counsel for Plaintiffs (Utah)micahrc:v,bruners. net

By: Isl Angel "Bacho" Vega #023036

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1 GREGORYG. MCGILL, P.c.ATIORNEY AT LAW

2 4421 N. 75th Street, Suite 101Scottsdale, Arizona 85251

3 (480) 970-6720FAX (480) 970-6727

4 [email protected] G. McGill, No. 011020

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Attorney for Defendants

Michael K. Jeanes, Clerk of Court*** Electronically Filed ***


911112009 11:51:36 PM

SUPERIOR COURT OF ARIZONA

COUNTY OF MARICOPA

NEDRA RONEY MCKELL and ROBERTMCKELL

Plaintiff,

vs.

No.: CV 2009-093004

REBUTTAL MEMORANDUMBY DEFENDANT WHITING RE:THE TRO AND FULL FAITH ANDCREDIT

GARY WHITING; CHEYENNE MOUNTAIN13 ENTERTAINMENT, INC, et al,

Defendants. Honorable Karen Potts141516171819

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Defendants Whiting and the several Arizona companies urge this honorable court to deny

full faith and credit to the Temporary Restraining Order issued in Utah based upon the following

reasons:

1. Plaintiff McKell has not cited to one case which holds that the principle

underlying full faith and credit, res judicata, is furthered if this court were to

enforce a temporary, interlocutory order from a sister state when that state court

has scheduled another preliminary hearing in that litigation and the controversy

recently commenced and is still being litigated. No citation was made because no

such citation exists.

2. No proof of proper service of the Notice of TRO Hearing or the First Amended

Complaint upon Whiting or the corporate defendants was introduced herein, so

the sister state temporary order may be collaterally attacked on grounds of lack of

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jurisdiction over the person or the subject matter, lack of due process, and that the

temporary order is invalid and unenforceable. Springfield Credit v. Johnson, 123

Ariz. 319, 599 P. 2d 772 (1979), citing Bebeau v. Berger, 22 Ariz. App. 522, 529

P.2d 234 (1974); and see Pioneer Federal Savings Bank v. Driver, 166 Ariz. 585,

804 P .2d 118 (1990).

3. "A judgment will not be recognized or enforced in other states if it is not eftnal

determination under the local law of the state of rendition." For example, if a

judgment is subject to the continuing modification jurisdiction of the rendering

state (eg., family court pendite lite orders), such a judgment is not res judicata and

it may be litigated in the sister state. The plaintiff has failed to assert a cogent

argument as to why a Temporary Restraining Order, particularly this one with all

its apparent infirmities (the terms of tile order do not define an actual injury. it

fails to state how any hann is irreparable, it lacks a duration, no bond or security

was required under Rule 65 or 66), should be treated as a "final order" for

purposes of sister state enforcement - and even the record in the rendering state

calls such a conclusion into serious doubt since Judge Laycock scheduled a

preliminary to address the merits on October 16,2009. Jones v. Roach, 118 Ariz.

146,575 P.2d 345 (1977). For example, a Temporary Restraining Order cannot

issue and be an enforceable order in this state until the trial court fixes a bond and

the bond is posted to protect the defendant against a wrongful restraint. Rule 65;

and State v. Neitz, 114 Ariz. 296, 560 P.2nd 814 (1977).

4. The point missed by the plaintiff is twofold: (i) it is trying to impose a

temporary order on out of state parties and corporations, and (ii) such immediate

enforcement would violate the underpinning of full faith and credit: that the

alleged defects and questions regarding the order be fully and fairly litigated and

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final before a sister state has to give it full faith and credit. Indeed, the U. S.

Supreme Court weighed in on this limitation to tile full faith and credit clause and

rested on the notion of "finality" and res judicata: "Public policy dictates that

there be an end to litigation, that those who have contested an issue shall be bound

by the result of the contest, and that the matters once tried shall be considered

forever settled as between the parties." Durfee v. Duke, 375 U.S. 106,84 S. Ct.

242, 11 L. ed. 2d 186 (1963). None of these limitations or standards on requiring

full faith and credit have neen shown by the Utah plaintiffs on the temporary

restraining order with all its facial defects - when a preliminary injunction hearing

is currently scheduled for October 16,2009.

5. "A judgment will not be recognized or enforced in otIler states if it is not a final

determination under the local law of state of rendition." Grynberg v. Shaffer, 216

Ariz. 256, 165 PJd 234 (2007). First, the TRO cannot meet this test. Second,

this limitation on comity is plain with respect to ''judgments'', so the limitation on

sister state recognition is even more compelling when one considers tile

interlocutory order as opposed a judgment that is final and appealable for

purposes of res judicata effect.

6. Finally, in tile opening Legal Memorandum the defense showed that the plaintiff,

and Vick Deauvono, filed sworn affidavits containing utterly unsubstantiated

charges that Mr. Wlriting absconded with loan proceeds, when tile accusations

were based on vague hearsay, no proof, no actual or continuing harm was shown-

and the plaintiff is merely an unsecured creditor without having introduced any

evidence in Utah that it had any disbursement or fund control agreements with

Whiting that would provide a legal basis for the extraordinary remedy of "director

removal", TRO and an interim receiver (by an interested party). The entire matter

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in Utah was a fraud on the court, and all the above referenced cases state that such

fraud is extrinsic fraud that allows a sister state to decline to enforce the

temporary order in this state until the merits are actually and fully litigated in Utah

the rendering state.

WHEREFORE, based upon the reasons set forth herein, the TRO and interim

receiver order in Utah should not be recognized by this honorable court until a final

determination is made on the merits in Utah and a final judgment is rendered that is

appealable, final and with res judicata effect. Plaintiffs will have every opportunity to

prove actual and continuing harm that must be enjoined, and that is what they must do in

order to replace Mr. Whiting in the Arizona entities while they are merely an unsecured

creditor without any fund control agreements in place.

DATED this 11th day of September, 2009.

ORIGINAL of the foregoingE-FILED this 11th day ofSeptember, 2009, with:

ClerkMARICOPA COUNTY SUPERIOR COURT201 W. JeffersonPhoenix, Arizona 85003;COPY of the foregoingEmailedthisl1Ihdayof<~2009.to:Bacha Vega, Esq. / 1

Dodge and Vega, PLC4824 E. Baseline Rd., Ste 124Mesa, AZ 85206

GREGORY G. MCGILL, P. C.

. Jfjfa~y for Defendants

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