EXHIBITB 

Case 2:18-cr-00422-DJH Document 516-2 Filed 04/02/19 Page 1 of 4
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IN THE SUPERIOR COURT OF THE STATE OF WASHINGTON 

IN AND FOR THE COUNTY OF PIERCE 

R.O., by and through her mother, 

S.H., and K.M., by and through 

her mother, L.M., 

) 

) 

) 

) 

Plaintiffs, 

vs. 

) No. 17-2-04897-1 

) 

) 

) 

MEDALIST HOLDINGS, INC,, et al. ) 

) 

Defendants. ) 

VERBATIM TRANSCRIPT OF PROCEEDINGS 

Wednesday, May 23, 2018 

Before The Honorable G. Helen Whitener 

Pierce County Courthouse 

Tacoma, Washington 

<<<<<< >>>>>> 

Kimberly A. O'Neill, CCR #1954 

Official Court Reporter 

Department 11, Room 202-A 

(253) 798-7281 

1 

---------R. C. vs. Medalist, Holdings, LLC-----------' 

Case 2:18-cr-00422-DJH Document 516-2 Filed 04/02/19 Page 2 of 4
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64 

I am going to grant the motion for sanctions. I believe 

an adequate record has been made supporting sanctions in 

this case for a number of reasons, all listed by Plaintiffs, 

but also the Court looks at what constitutes a bad faith, 

and there are three ways the Court can look at it. 

Pre-litigation misconduct: I'm finding that given the 

history of the defendants in this case in the multiple cases 

they've had, not just before this Court -- I have two -- not 

just in this state but nationally, it is clear to this Court 

that their conduct was to necessitate delay where there were 

what appears to be clearly valid claims or rights being 

asserted by the Plaintiff which, months and years later, is 

now being disclosed by Mr. Ferrer as seen by his plea and 

the statements made in those pleadings in the Arizona case 

which I reviewed. 

Another one that the Court can consider in regards to bad 

faith is procedural bad faith and that is vexatious conduct 

during the course of litigation, wasting private and 

judicial resources, making claims that, months later, were 

found to be untruthful. Many of the statements that I'm not 

placing into the record can be seen in the pleadings the 

Court reviewed in camera provided by the Defense which will 

be placed under seal if there is further review of this 

matter. 

And a third factor that can constitute bad faith is 

----------R. C. VS. Medalist Holdings, LLC----------

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65 

substantive bad faith, and I'm not finding that in this 

case. 

I will say, also, supporting my position regarding the 

pre-litigation misconduct and procedural bad faith were the 

Court's review of the Interrogatory No. 2 and the Request 

for Production No. 1. The various requests for admission 

were taken into consideration and Exhibit 3, the declaration 

of Attorney Elizabeth McDougall. 

I will note that Mr. Ferrer's condition of his plea in 

March 2018 in Arizona were for overriding conspiracy with a 

start date of 2004 through March of 2018 during the time 

period not only when this case was filed but the J.S. case, 

that this Court also had, was filed. 

Sanctions in the amount of $100,000 for each plaintiff is 

being ordered. That needs to be paid within 30 days of 

'today's date. Failure to comply, the Court will issue 

sanctions in the amount of one dollar for every page of the 

1.2 million documents -- and, actually, not page, for the 

documents. So, there were 1.2 million documents, one dollar 

for every document, so that will be $1.2 million for every 

14 days of noncompliance. 

Reasonable attorney fees will be allowed and granted, 

subject, of course, to any objections to the amount. If not 

objected to, that needs to be paid within 30 days, as well, 

of production of the billings. 

----------R.C. vs. Medalist, Holdings, LLC----------

Case 2:18-cr-00422-DJH Document 516-2 Filed 04/02/19 Page 4 of 4