4817-8311-7308.5 

UNITED STATES DISTRICT COURT 

WESTERN DISTRICT OF TEXAS 

SAN ANTONIO DIVISION 

JONATHAN VILLAREAL, 

individually and derivatively on behalf of

ZROBLACK LLC, 

Plaintiff, 

v.

JOHN SAENZ; MIGUEL VILLAREAL, 

JR.; and GUNN, LEE & CAVE, P.C., 

Defendants. 

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No. 5:20-CV-00571-OG

DEFENDANT JOHN SAENZ’S RESPONSE IN OPPOSITION TO PLAINTIFF’S 

MOTION TO SANCTION PURSUANT TO FED. R. CIV. P. 11 

______________________________________________________________________________ 

Defendant John Saenz (“Saenz”), through his undersigned counsel, hereby submits this 

Response in Opposition to the Motion to Sanction Pursuant to Fed. R. Civ. P. 11 (ECF No. 71) (the 

“Motion”) filed by Plaintiff Jonathan Villareal, individually and as the owner of ZroBlack, LLC, 

(“Plaintiff” or “Villareal”), and respectfully requests that this Court deny Plaintiff’s Motion. In 

support thereof, Saenz states as follows. 

INTRODUCTION 

As an initial matter, the Motion filed by Villareal is based, at least in part, on purported and/or 

hypothetical out-of-court conduct, rather than on any assertions contained in papers that Saenz filed 

or submitted to the Court. Therefore, the Motion improperly raises issues beyond the scope of Federal 

Rule of Civil Procedure (“FRCP”) 11. The Motion is also improper because no advanced notice was 

provided to Saenz as required by the safe harbor requirements of FRCP 11. For these reasons alone, 

the Motion should be denied. 

Furthermore, Villareal purports to have filed the Motion “as the owner of ZroBlack, LLC” 

and “NOT FOR ZroBlack, LLC.” ECF No. 71, at p. 2 (emphasis in original). Following the Court’s 

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Order (ECF No. 67), however, the three remaining claims in this lawsuit all necessarily belong to, 

and have been pleaded solely as claims of, ZroBlack, LLC (“ZroBlack”)—not Villareal in his 

individual capacity. Thus, to the extent Villareal filed the Motion in his individual capacity, he has no 

remaining claims in such capacity against Saenz to support such a motion. 

Moreover, the complaints at issue in the Motion all relate to the laptop and/or LinkedIn page 

purportedly owned by ZroBlack. Accordingly, whether Villareal admits it or not, the Motion was 

necessarily filed on behalf of ZroBlack. As the Court has previously noted, however, Villareal cannot 

represent or file documents on behalf of ZroBlack in this legal proceeding as a non-attorney. The 

Motion should be denied for this additional reason as well, and ZroBlack’s remaining claims against 

Saenz should be dismissed for failure to obtain counsel. 

Additionally, the complaints in the Motion have also all previously been urged to and 

dismissed by the Court in the form of Plaintiffs’ dismissed causes of action and application for 

injunctive relief. The Motion is, therefore, in reality a motion for reconsideration, which should be 

denied because Villareal has failed to identify any extraordinary circumstances justifying relief 

beyond simply re-urging the same merits arguments previously raised and denied by the Court. In 

addition, the prior application for injunctive relief was denied for a number of reasons not addressed 

in the Motion, including inexplicable delay and speculative harm; thus, there is no basis for 

reconsideration of the Court’s prior denial. In light of these prior orders of the Court, the Motion 

should be denied. 

Finally, the Motion fails because it does not state to whom it is addressed or what sanctions 

are being sought, and the arguments and purported evidence offered in support thereof fail to establish 

that any proprietary code is, in fact, on the subject laptop. The Motion should, therefore, be denied on 

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these additional bases as well. The remainder of the Motion contains conclusory allegations and 

hyperbole to which no response is necessary. 

BACKGROUND 

Plaintiffs filed their Original Complaint (ECF No. 1) on May 8, 2020, followed by a First 

Amended Verified Complaint (ECF No. 35) and First Amended Application for Seizure, Temporary 

Restraining Order, Preliminary Injunction, and Permanent Injunctive Relief (the “Application”) (ECF 

No. 35-1) on January 15, 2021. 

On May 14, 2021, U.S. Magistrate Judge Farrer entered a Report and Recommendation of 

United States Magistrate Judge (ECF No. 58). On May 18, 2021, U.S. Magistrate Judge Farrer entered 

a second Report and Recommendation (ECF No. 59). These Reports and Recommendations were 

adopted in full by the Court’s August 4, 2021 Order (the “Order”) (ECF No. 67). In pertinent part, 

the Order denied Plaintiffs’ Application and granted in part and denied in part Saenz’s Motion to 

Dismiss. “Only Plaintiffs’ claims against Defendant Saenz for breach of fiduciary duty and for 

violations of the CFAA and ACPA—insofar as these claims are premised on Saenz’s alleged conduct 

after the parties executed the Release”—survived the Motion to Dismiss. ECF No. 67, at p. 7. 

On June 25, 2021, the Court granted the Motion to Withdraw filed by former counsel for 

Plaintiffs. See ECF No. 62. The Court also advised Plaintiffs that ZroBlack “can only be represented 

by licensed counsel” and “needs to obtain counsel and have them enter an appearance on the docket 

within 30 days ... in order to avoid dismissal of its claims.” Id. 

Plaintiffs then sought additional time to obtain counsel (ECF No. 66), which Saenz did not 

oppose. On August 6, 2021, the Court entered a Text Order granting Plaintiffs’ Motion for Extension 

of Time as unopposed. The Text Order provided that “Plaintiff is granted an extension and shall have 

up to and including September 20, 2021, to obtain a new attorney” and that “ZroBlack must have 

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counsel enter an appearance on the docket in order to avoid dismissal of its claims.” As of the filing 

of this Response, ZroBlack has not had any new counsel enter an appearance, and neither Villareal 

nor ZroBlack have advised Saenz or the undersigned counsel of any legal counsel obtained on behalf 

of ZroBlack. 

On September 22, 2021, Plaintiffs served Saenz with the Motion for the first time after 

purportedly filing the Motion with the Court the day prior. 

ARGUMENT 

A. THE MOTION SHOULD BE DENIED TO THE EXTENT IT IS NOT BASED ON ASSERTIONS 

CONTAINED IN PAPERS THAT SAENZ FILED OR SUBMITTED TO THE COURT. 

The Advisory Committee Notes to FRCP 11 clarify that “[t]he rule applies only to assertions 

contained in papers filed with or submitted to the court.” FED. R. CIV. P. 11 Advisory Committee’s 

Note (1993 Amendments, Subdivisions (b) and (c)); see also In re Bees, 562 F.3d 284, 289 (4th Cir. 

2009) (providing that FRCP 11 “permits a court to impose sanctions only on the basis of a false, 

misleading, or otherwise improper ‘pleading, written motion, or other paper’”) (quoting FRCP 11(b)). 

Here, however, Villareal’s Motion is based, at least in part, on purported out-of-court conduct, 

including hypothetical conduct that has not occurred but that Plaintiffs think could be performed by 

or on behalf of Saenz at some unspecified time in the future. See, e.g., ECF No. 71, at p. 2 (“I warned 

the defense council [sic] ... that I was going to file sanctions for their continued illegal actions of 

deletion of company records, ... tampering of evidence, and for the defense council’s [sic] 

contribution to known illicit activity.”); id. at p. 3-4 (alleging that Saenz has stolen the companyowned laptop and asking: “When this laptop becomes part of a botnet to spread ransomware all around 

the world, or is found to be infested with child pornography, who will be responsible when the serial 

number is searched by the FBI?”); id. at p. 14 (alleging that Saenz impersonated a manager or director 

of ZroBlack to continue using, and ultimately delete, the company’s LinkedIn page); id. at p. 14-15 

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(alleging that “[Saenz] and Col. Devine devised a plan to defraud the US Government by [Saenz] 

claiming ZroBlack was a disadvantaged company, and Col Devine writing ZroBlack’s capabilities 

paper”). 

Even assuming, arguendo, that these allegations are true or could be true at some point, which 

Saenz denies, FRCP 11 does not provide a basis for sanctioning any such out-of-court conduct. 

Accordingly, to the extent the Motion is based on purported conduct or statements not asserted in 

submissions to the Court, the Motion should be denied. 

B. ADDITIONALLY, AND IN THE ALTERNATIVE, THE MOTION SHOULD BE DISMISSED FOR 

FAILURE TO PROVIDE 21 DAYS’ NOTICE, AS REQUIRED BY FRCP’S “SAFE HARBOR”

PROVISION. 

Under FRCP 11’s “safe harbor” provision, “a motion for sanctions may not be filed until at 

least 21 days after service on the offending party.” Elliott v. Tilton, 64 F.3d 213, 216 (5th Cir. 1995); 

FED. R. CIV. P. 11(c)(2). The Fifth Circuit has “continually held that strict compliance with Rule 11 

is mandatory.” In re Pratt, 524 F.3d 580, 588 & n.30 (5th Cir. 2008) (internal citations omitted). “A 

party’s failure to comply with the safe harbor provision generally precludes a district court from 

granting the party’s motion for sanctions under Rule 11.” Askins v. Hagopian, 713 Fed. Appx. 380, 

380-81 (5th Cir. 2018) (citing Elliott, 64 F.3d at 216). 

Plaintiff served the Motion on counsel for Saenz, for the first time, on September 22, 2021, 

after it was filed with the Court. The Motion should, therefore, be denied for failure to comply with 

the safe harbor requirements of FRCP 11. 

C. ADDITIONALLY, AND IN THE ALTERNATIVE, (1) THE MOTION SHOULD BE DENIED 

BECAUSE,CONTRARY TO VILLAREAL’S ASSERTIONS,IT IS IMPROPERLY FILED ON BEHALF 

OF ZROBLACK, AND (2) THE REMAINING CLAIMS OF ZROBLACK AGAINST SAENZ SHOULD 

BE DISMISSED FOR FAILURE TO OBTAIN LEGAL COUNSEL.

Villareal makes the conclusory allegation in the Motion that he is acting pro se “as the owner 

of ZroBlack, LLC... and NOT FOR ZroBlack, LLC.” ECF No. 71, at p. 2 (emphasis in original). 

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This statement is inaccurate and requires not only a denial of the Motion, but also a dismissal of 

ZroBlack’s remaining claims against Saenz. 

The entirety of the Motion is based on two allegations: that Saenz (1) continues to possess the 

laptop purportedly containing proprietary code and purportedly owned by ZroBlack, and (2) deleted 

the LinkedIn page purportedly owned by ZroBlack. See generally ECF No. 71. The mere subject 

matter of these claims makes clear that they belong, if at all, to ZroBlack—not to Villareal in his 

individual capacity. See ECF No. 71 at pp. 3-4, 14 (repeatedly referring to the laptop as the “company 

laptop,” contending that the laptop is “registered to ZroBlack,” and contending that the referenced 

LinkedIn account is “an asset of my company ZroBlack”). Indeed, all three of the remaining claims 

against Saenz in this case belong, on their face, to ZroBlack alone and have been pleaded as such in 

Plaintiffs’ live pleading. To be sure, the claims that survived the Motion to Dismiss, as outlined by 

the Court, are “for breach of fiduciary duty and for violations of the CFAA and ACPA—insofar as 

these claims are premised on Saenz’s alleged conduct after the parties executed the Release.” ECF 

No. 67, at p. 7. Not only would any purported formal fiduciary duties of Saenz run solely to ZroBlack 

(as opposed to other members) as a matter of law in Texas, but the First Amended Verified Complaint 

also specifically alleges that Saenz owed and breached fiduciary duties to ZroBlack alone—not to 

Villareal individually. See ECF No. 35, at ¶¶ 186-199 (Count 5) (“As a CEO and Managing Member 

of ZroBlack, Defendant Saenz was a fiduciary of ZroBlack at all times material to this action. 

Defendant Saenz breached his fiduciary duty to ZroBlack by engaging in transactions that benefitted 

him, personally, at the expense of ZroBlack.”). Similarly, the property and allegations made the basis 

of the CFAA and ACPA causes of action—namely, the subject laptop, webpage, and email server—

are all purportedly owned by ZroBlack, and the alleged damages in support of such purported 

violations are likewise all attributable to ZroBlack alone—not to Villareal individually. See ECF No. 

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35, at ¶¶ 163-173, 175-184 (Counts 2 and 3) (claiming that: (i) “Saenz’s access and deletion of 

ZroBlack’s webpage and email server interrupted GoDaddy’s service to ZroBlack,” (ii) “Saenz was 

required to return ZroBlack’s property to it upon request as it was the property of ZroBlack,” (iii) the 

laptop is “the property of ZroBlack in accordance with the Company Agreement,” (iv) “Saenz has 

not released the GoDaddy account to ZroBlack,” and (v) “Saenz’s actions have caused ZroBlack to 

lose major contracts....”). Accordingly, to the extent Villareal contends that the Motion is brought by 

Villareal in his individual capacity, it should be denied because Villareal has no remaining claims in 

such capacity against Saenz to support such a motion or any potential relief from the Court. Indeed, 

Plaintiffs’ own Complaint makes clear that the three surviving claims of Plaintiffs belong to ZroBlack 

only, which means that the Motion was necessarily filed on behalf of ZroBlack. 

More importantly, Villareal’s representations to the contrary—namely, that he filed the 

Motion solely in his individual capacity, after the Court’s (extended) deadline of September 20, 

2021 for ZroBlack to retain legal counsel—only confirms that ZroBlack remains unrepresented by 

legal counsel. Accordingly, pursuant to the Court’s August 6, 2021 Text Order Granting Plaintiffs’ 

Motion for Extension of Time, the Motion must be denied because: (1) it was improperly filed by a 

non-attorney on behalf of ZroBlack, and (2) ZroBlack failed to retain new counsel by the deadline 

provided by the Court in order to avoid dismissal of its claims. Thus, in addition to a denial of the 

Motion, the remaining claims of ZroBlack against Saenz should be dismissed with prejudice in their 

entirety. See Memon v. Allied Domecq QSR, 385 F.3d 871, 873 (5th Cir. 2004) (noting that 

corporations, partnerships and associations cannot appear in federal court otherwise than by licensed 

counsel and discussing the parameters for dismissal with prejudice when a non-attorney purports to 

appear on behalf of the entity). 

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D. ADDITIONALLY, AND IN THE ALTERNATIVE, THE MOTION SHOULD BE DENIED BECAUSE 

THE COMPLAINED-OF CONDUCT IS BARRED BY THE RELEASE AND THE COURT’S PRIOR 

ORDER, AND THE MOTION IS AN IMPROPER AND UNTIMELY ATTEMPT TO MOVE FOR 

RECONSIDERATION OF THE COURT’S PRIOR RULINGS.

The complaints raised in the Motion all relate to allegations previously urged by Plaintiffs and 

denied by the Court in the form of Plaintiffs’ dismissed causes of action and denied Application. 

Specifically, as stated previously, the entirety of the Motion is based on two allegations: that Saenz 

(1) continues to possess the laptop purportedly containing proprietary code and purportedly owned 

by ZroBlack, and (2) deleted the LinkedIn page purportedly owned by ZroBlack. See generally ECF 

No. 71. However, none of the remaining causes of action, as alleged in Plaintiffs’ First Amended 

Verified Complaint, relate to the subject LinkedIn page, and only the cause of action for violations of 

the CFAA even refers to the subject laptop. See ECF No. 35, at ¶¶ 163-173, 175-184, 186-199 (Counts 

2, 3, and 5). However, those portions of Plaintiffs’ CFAA claim that could potentially involve the 

laptop relate to conduct that was dismissed by the Court as barred by the parties’ prior release. See

ECF No. 35, at ¶ 166-67 (contending that, after the Release was signed, Saenz was required to, but 

refused, to return the laptop to ZroBlack); Report and Recommendation of United States Magistrate 

Judge, ECF No. 59, at p. 9 (“At the time of the Release, Plaintiffs could’ve—but didn’t—demand 

return of the laptop ....”); id. at p. 11 (“Plaintiffs’ claims against Saenz for ... violations of the ... 

CFAA, ACPA—to the extent Plaintiffs’ CFAA and ACPA are premised on Saenz’s refusal to return 

the laptop—... are barred by the Release.”) (emphasis added). Additionally, the Motion is full of 

references to alleged conduct by Saenz that pre-date the release and are therefore barred by the release. 

See ECF No. 71 at p. 6-12. The Motion is, therefore, without merit and should be denied as such. 

In reality, the Motion is effectively a motion for reconsideration, which should also be denied 

because Villareal has failed to meet the criteria outlined in FRCP 60(b) or to otherwise identify 

extraordinary circumstances justifying relief, beyond simply re-urging the same merits arguments 

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previously raised and denied by the Court. See FED. R. CIV. P. 60(b); Clay v. McAnear, No. SA-17-

CA-279-FB (HJB), 2018 U.S. Dist. LEXIS 199051, at *14-15 (W.D. Tex. June 11, 2018) (“Though 

a grand reservoir of equitable power, [Rule 60(b)(6)] is to be exercised sparingly, and relief should 

be granted only in extraordinary circumstances. Under this Rule, the movant must show a reason 

justifying relief other than the more specific circumstances set out in Rules 60(b)(1)-(5).”) (internal 

citations omitted). In Clay, the court denied a motion to reconsider a default judgment when, as here, 

the movant simply re-urged the merits arguments raised previously, and the court confirmed that “[i]t 

is far too late to relitigate issues that [the movant] either lost before, or chose not to contest.” Id. at 

*16 (internal citations omitted); see also Yesh Music v. Lakewood Church, 727 F.3d 356, 363 (5th 

Cir. 2013) (providing further that “Rule 60(b)(6) requires a showing of ‘manifest injustice’ and will 

not be used to relieve a party from the ‘free, calculated, and deliberate choices he has made.’”) 

(internal citations omitted). 

Furthermore, Plaintiffs’ Application complained of the very issues that are now again before 

the Court in the Motion (i.e., return of laptop), and the Application was denied for numerous reasons 

not addressed in the Motion, including most notably Plaintiffs’ inexcusable and extensive delay, 

Plaintiffs’ lack of mitigation efforts, the speculative harm alleged, and the past harm and availability 

of monetary damages. See generally ECF 35-1 (seeking seizure of the laptop); see also Report and 

Recommendation of United States Magistrate Judge, ECF No. 58, at pp. 7-11. Accordingly, there is 

no basis for reconsideration of the Court’s prior orders, and the Motion should therefore be denied. 

Finally, ZroBlack failed to object to the either of the Reports and Recommendations of United States 

Magistrate Judge related to the Motion to Dismiss and the Application, and therefore ZroBlack should 

not be permitted to re-litigate the same issues following its failure to object. 

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E. ADDITIONALLY, AND IN THE ALTERNATIVE, THE MOTION SHOULD BE DENIED BECAUSE IT 

FAILS TO STATE TO WHOM THE REQUEST FOR SANCTIONS IS ADDRESSED AND WHAT 

SANCTIONS ARE BEING SOUGHT.

The only request for sanctions remotely identifiable in the Motion is that Villareal purportedly 

wants “justice” and “the criminals put in jail so that they can never do this to anyone ever again.” ECF 

No. 71, at p. 15. This prayer for relief, however, fails to identify the purported “criminals,” much less 

any conduct rising to the level of criminal conduct. More importantly, FRCP does not allow for 

criminal punishment, and Villareal fails to otherwise request sanctions permissible under the Rule. 

See FED. R. CIV. P. 11(c)(4), (5). The Motion should thus be denied on this additional basis as well. 

F. ADDITIONALLY, AND IN THE ALTERNATIVE, THE MOTION SHOULD BE DENIED BECAUSE IT 

FAILS TO ESTABLISH THAT ANY PROPRIETARY CODE IS STORED ON THE SUBJECT LAPTOP.

The Motion relies heavily on the statement in Evernote’s privacy policy to the effect that 

“[w]hen you use Evernote Software on your computing device... some of your data will be stored 

locally on that device.” ECF No. 71, at p. 5 (emphasis added). However, Villareal then assumes, 

without any further factual basis or other support, that such data necessarily includes the alleged 

proprietary code he wrote and that only an expert such as himself can uncover. This assumption does 

not fairly flow from the privacy statement and is otherwise unsupported by the arguments and 

purported evidence urged in the Motion. Likewise, there is no evidence that any information Saenz 

submitted to the Court is untrue. For these additional reasons, and because the remainder of the 

Motion contains conclusory allegations and hyperbole to which no response is required, Saenz 

respectfully submits that the Motion should be denied. 

G. SAENZ SHOULD BE AWARDED HIS ATTORNEYS’ FEES AND COSTS ASSOCIATED WITH 

RESPONDING TO PLAINTIFF’S BASELESS MOTION.

 “[T]he filing of a motion for sanctions is itself subject to the requirements of [FRCP 11] and 

can lead to sanctions.” FED. R. CIV. P. 11 Advisory Committee’s Note (1993 Amendments, 

Subdivisions (b) and (c)). “However, service of a cross motion under Rule 11 should rarely be needed 

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since under the revision the Court may award to the person who prevails on a motion under Rule 11—

whether the movant or the target of the motion—reasonable expenses, including attorney’s fees, 

incurred in presenting or opposing the motion.” Id.; see also Smith v. Psychiatric Solutions, Inc., 750 

F.3d 1253, 1260 (11th Cir. 2014). 

For the reasons outlined above (and incorporated herein by reference), the Motion is without 

merit, both procedurally and substantively. Saenz, therefore, respectfully requests that he be awarded 

his reasonable expenses, including attorneys’ fees and costs, incurred in opposing the Motion. 

CONCLUSION 

WHEREFORE, Defendant John Saenz respectfully requests that the Court: (1) deny 

Plaintiff’s Motion to Sanction Pursuant to Fed. R. Civ. P. 11, (2) award Saenz his reasonable 

attorneys’ fees and costs incurred in responding to Plaintiff’s baseless Motion to Sanction Pursuant 

to Fed. R. Civ. P. 11; and (3) grant to Saenz such other and further relief to which he is entitled at 

law or in equity. 

Respectfully submitted this 28th day of September 

2021.

By: /s/ David A. Vanderhider

David A. Vanderhider 

State Bar No. 24070787 

DVanderhider@dykema.com 

Daniel A. Ray 

State Bar No. 24098306 

DRay@dykema.com 

DYKEMA GOSSETT PLLC 

112 East Pecan St., Suite 1800 

San Antonio, Texas 78205 

(210) 554-5500 – Telephone 

(210) 226-8395 – Facsimile 

Attorneys for John Saenz

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CERTIFICATE OF SERVICE 

I hereby certify that a copy of the foregoing was electronically filed with the Court on the 

28th day of September 2021, and electronically served on the date reflected in the ECF system 

upon all parties registered to receive notice pursuant to the Court’s CM/ECF system. 

By: /s/ David A. Vanderhider 

David A. Vanderhider 

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