Case 1:10-cv-04433-ILG -SMG Document 52 Filed 05/31/11 Page 1 of 7

DISERIO MARTIN O’CONNOR & CASTIGLIONI LLP

ATTORNEYS AT LAW

ONE ATLANTIC STREET

35 MASON STREET
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FACSIMILE: (203) 348-2321 TELEPHONE: (914) 684-0090

WWW.DMOC.COM SERVICE BY FACSIMILE NOT ACCEPTED

MATTHEW C. WAGNER
Admitted in CT, NY, MA and DC
CT Direct Dial: 203-569-1195
mwagner@dmoc.com

Reply to: Stamford Office

31 May 2011

VIA ECF
Chief Magistrate Judge Steven M. Gold
United States District Court
for the Eastern District of New York
225 Cadman Plaza East
Room 921 South
Brooklyn, NY 11201

Re: Ascentive, LLC, and Classic Brands, LLC v.

Opinion Corp. d/b/a PissedConsumer.com, et al.
Civil Action No. 1:10-cv-04433-ILG-SMG (E.D.N.Y.)

Our File: 27847

Dear Judge Gold:

This firm represents plaintiff Classic Brands, LLC in the above matter. We write jointly
in conjunction with counsel for Ascentive, LLC, Abbe Fletman of Flaster Greenberg PC, in
accordance with Your Honor’s Minute Order dated May 10, 2011, to apprise the Court of the
current status of discovery and to identify the outstanding disputes Plaintiffs seek to raise at the
conference scheduled for 2:00 PM on Friday June 3, 2011 (Minute Order of May 4, 2011).

This is an injunction matter in which Ascentive and Classic Brands received Court
permission to conduct expedited discovery beginning in November 2010. Despite that fact, and
a fact discovery cut-off date of June 29, 2011, PissedConsumer has failed to provide the most
basic information about its operations, including failing to produce emails between its two
principals, Michael Podolsky and Alex Syrov, and failing to provide any financial information
about the profits PissedConsumer reaps through extorting “reputation management”payments
from “clients”as part of its racketeering scheme.
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1. PissedConsumer’s Deficient Document Production

After having identified deficiencies in PissedConsumer’s discovery responses as early as

January 2011, on April 29, 2011, Plaintiffs again wrote PissedConsumer about the various
deficiencies in their document production, in advance of the then-scheduled conference with the
Court on May 5, 20111. See D.E. 51, Exhibit B, also attached as Exhibit A. Despite the fact that
nearly three months have passed since this Court ordered PissedConsumer to “either produce the
discovery discussed today with the names of non party customers redacted, or stipulate that
plaintiffs have satisfied the pattern element of RICO, by February 25, 2011”(Minute Entry
February 18, 2011), and Plaintiffs’repeated requests for compliance, PissedConsumer has
dragged its feet, produced incomplete documents with heavy redactions including not just the
“names on non party customers”but also “whatever other information [PissedConsumer]
deem[ed] in good faith to be confidential.” See Exhibit A, at 3, middle of second full paragraph.
PissedConsumer remains non-compliant with this Court’s discovery Order.

The parties met and conferred on these issues on May 10, 2011, and Plaintiffs confirmed
the discussion in writing on May 11, 2011. See Exhibit B. Plaintiffs provided PissedConsumer
with additional information about their claims for damages, since PissedConsumer refused to
provide any information in response to interrogatory number 4, seeking the identification of bank
accounts into which monetary compensation was paid in connection with advertisements
displayed on the website PissedConsumer.com and/or its sub-domains, including, but not limited
to, http://ascentive.pissedconsumer.com and http://finallyfast.pissedconsumer.com.
PissedConsumer responded to Plaintiffs in writing on May 24 on some, but not all, of the issues
raised in writing and on the telephone. See Exhibit C. For the first time, PissedConsumer
“ceded to [Plaintiffs] request”and committed to: providing documents on a rolling basis “in the
days ahead;”a redaction log; and supplemental discovery responses after production is complete
“to ensure their conformity with our supplemental document productions.” See Exhibit C, at 2-
3. While PissedConsumer has now produced certain additional documents as late as Sunday,
May 30, 2011 (over a holiday weekend and the day before this letter was due on May 31),
comprised of hundreds of pages of heavily redacted documents they should have produced
months ago), Plaintiffs have no way of knowing if this discovery is complete. PissedConsumer
has also failed to provide a redaction log (which they promised to do) to “allow defendants to
correlate documents in connection with PissedConsumer customers, i.e., Customer A, Customer
B, etc.,”or other supplemental discovery responses as they have promised. This is important
because PissedConsumer’s redaction of documents to date has made it impossible for Ascentive
and Classic Brands to determine how many “reputation management”clients PissedConsumer
has, what “services”PissedConsumer is providing to each, or how much each client is paying for
these “services.” The Court has already ruled that Plaintiffs are entitled to this information, but
PissedConsumer has failed to provide it.

1
On May 2, 2011, Mr. MacMull sought and obtained adjournment of the May 5 conference (now
scheduled for June 3), due to ascheduling conflict he identified for the first time in a letter to the
Court on May 2, 2011. D.E. 50. The May 5 conference had been scheduled at our last
conference on February 17. Mr. MacMull obtained adjournment of the conference as a result of
a conflict in his schedule to “permit the participation of the attorneys directly involved in these
issues,”e.g., Mr. MacMull.
2
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Also, in its letter of May 24, PissedConsumer has finally agreed to produce emails
between the individual defendants but it appears none has been produced to date.

PissedConsumer has refused to produce communications with third parties regarding

complaints and the “reputation management”program, where no non-disclosure agreement
(“NDA”) was signed. “Defendants take the position that where there was no executed NDA,
they will not produce documents exchanged between a prospective customer and
PissedConsumer since such a production could not possibly rise to information reasonably
calculated to lead to the discovery of admissible evidence.” Exhibit C, page 2. However, such
communications will likely (and obviously) lead to identification of other third-party witnesses
who had communications with PissedConsumer about exactly the kind of activity of which
Plaintiffs complain in this lawsuit, but never entered an NDA (just like Classic), which would
yield highly relevant evidence supporting the pattern element of Plaintiffs’claims (with which
the Court is now quite familiar and with respect to which PissedConsumer ultimately refused to
stipulate). PissedConsumer has refused to stipulate to this element, and therefore it should be
required to fully and completely provide this discovery –without redaction, since no NDA was
signed. It does appear to Ascentive and Classic that PissedConsumer may now be amenable to
producing these communications, but they steadfastly redact information which is critical to
identifying these third-parties and allowing Ascentive and Classic to properly develop discovery
and prosecute their claims.

2. PissedConsumer’s Deficient Interrogatory Responses.

In its letter of May 24, 2011 (Exhibit C), PissedConsumer also finally cedes to Plaintiffs
requests for (some) banking information in interrogatories 2 and 5, and it has purportedly done
so (Exhibit D). They have now identified two accounts at JP Morgan Chase. Exhibit D. Mr.
Podolsky at his deposition testified that Defendants maintained accounts at Chase Bank as well,
but the interrogatory response lists no accounts at Chase Bank. PissedConsumer has still failed
to respond to interrogatory 4, which requests details on the amounts paid to PissedConsumer by
third-party advertisers identified in interrogatory number 3. In its letter, PissedConsumer
confirms that the list of advertisers identified in its response to interrogatory 3 “is indeed limited
to the pissedconsumer.com website”; yet, PissedConsumer complains that because the
interrogatory could be read to include advertisers who participate in other websites owned by
PissedConsumer (even though the list is limited only to those who participate in activity at the
website which is subject to this lawsuit), they maintain the request is overbroad and it will not
produce relevant information. This argument is for argument’s sake and nothing more. Yet
again, PissedConsumer uses as a ploy boiler plate objections to valid discovery requests, and
argues hypothetical results to stall and delay these proceedings. The Court should order
PissedConsumer to fully disclose all bank accounts and respond fully to these interrogatories
with the requested information about revenues.

3. Subpoenas to Chase Bank and JP Morgan Chase.

Faced with a complete lack of cooperation from PissedConsumer with regard to banking
information and financial details of their operation (as explained above), Ascentive and Classic

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were left with no choice but to issue subpoenas to the relevant banking institutions. On April 18,
2011, Classic served defendants Opinion Corp. d/b/a Pissed.Consumer.com, Michael Podolsky
and Alex Syrov (collectively, “PissedConsumer”) with its Notice of Service of Subpoenas on,
inter alia, JP Morgan Chase and Chase (“Chase Subpoenas”). See Exhibit E. These subpoenas
sought information about PissedConsumer’s bank accounts, which are relevant to Ascentive’s
and Classic’s claims in this case, including PissedConsumer’s racketeering scheme, and
trademark damages (which Plaintiffs can prove by showing PissedConsumers’revenues or
“sales”).2 These sales are reflected by amounts deposited into PissedConsumer’s accounts by its
customers and Google and other vendors from which PissedConsumer receives advertising
revenues. PissedConsumer has flatly refused to produce such information cooperatively in
response to discovery requests.

PissedConsumer objected to the Chase Subpoenas by letter on April 27, 2011. See
Exhibit F. On April 29, 2011 counsel for Ascentive responded by letter to PissedConsumer. See
Exhibit G. On May 10, 2011, counsel for the parties discussed the outstanding objections to the
subpoenas. Plaintiffs agreed with PissedConsumer to hold production pursuant to the Chase
Subpoenas in abeyance pending resolution of the objections, and committed to informing Chase
and JP Morgan of this decision, and they have done so.

Notwithstanding this agreement, on May 12 and 13 PissedConsumer initiated a new legal

proceeding and filed a motion to quash the Chase Subpoenas in the US District Court for the
District of Connecticut, Civil Action No. 3:11-mc-00070-MRK, Ascentive LLC et al v. Opinion
Corp et al. See Exhibit H. Judge Kravitz of the District of Connecticut has now set a response
deadline of June 6, 2011. See Exhibit I. This Court can resolve the issues presented at our
conference on June 3 in advance of Ascentive and Classic’s deadline to respond on June 6,
which would obviously save thousands of dollars in legal fees and a great deal of time and
additional delay. On May 23, 2011, the parties discussed this issue during a meet and confer.
Plaintiffs suggested that the parties could resolve this dispute if PissedConsumer would identify
their bank accounts, which they had previously refused to do in responses to discovery, and
consented to the production pursuant to the Chase Subpoenas of any records concerning business
accounts into which proceeds from the pissedconsumer.com website and its Reputation
Management program had been deposited. Ascentive and Classic suggested that this Court (and
not the District of Connecticut) was the proper forum in which such a discovery dispute should
be resolved between the parties to this action. Counsel for PissedConsumer (Mr. MacMull) said
he was unaware that PissedConsumer could agree to the jurisdiction of this Court for that
purpose. Counsel for Classic Brands (Mr. Wagner) explained that Chase and JP Morgan did not
file a motion to quash (indeed, they both sought to cooperatively produce documents under the

2
“Under the Lanham Act, it is quite clear that, in computing defendant's profits, the defendant
has the burden of proof as to the allowance of any deductions from his gross sales . . . Thus, the
plaintiff need only prove gross sales and it is then the infringer's burden to prove (1) which, if
any, of those sales were not attributable to the wrongful act, and (2) deductible costs and
expenses to arrive at net profits. In most cases, the only way for plaintiff to find out what the
infringer's gross sales have been is from the infringer itself in discovery.” 5 J. THOMAS
MCCARTHY, MCCARTHY ON TRADEMARK INFRINGEMENT AND UNFAIR
COMPETITION § 30:66 at 30-160 (4th ed. 2011).
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protective order), but PissedConsumer had filed the motion, and they could easily have raised
this issue in this Court, and consent to resolution by Your Honor. We have had no response to
this suggestion.

Counsel for PissedConsumer (Mr. MacMull) also stated that he did not know what
accounts PissedConsumer had, despite the fact that Ascentive and Classic Brands had sought this
information by deposition in December 2010 and by interrogatory since at least March 25, 2011.
In the meantime, PissedConsumer has now identified two bank accounts held at JP Morgan
Chase in a supplemental interrogatory response (see Exhibit D) and again protested production
of documents pursuant to the subpoena, as well as providing information about revenues and
money deposited into these accounts (e.g., see discussion above, response to interrogatory
number 3 in Exhibit D, and Exhibit J, at 3-4.

The Court should resolve PissedConsumer’s objection to compliance with the Chase
Subpoenas, which will allow these third parties to produce documents pursuant to the subpoenas,
and order PissedConsumer to fully respond to the written discovery requests on these issues.

4. Classic’s Motion to Supplement its Motion for Preliminary Injunction

As recounted in Classic’s letter dated April 20, 2011 (D.E. 46), its motion to supplement
its motion for preliminary injunction (the “Motion”, D.E. 40-43) remains pending with this
Court, without response by PissedConsumer. PissedConsumer contends that Classic’s Motion
should be stricken and that no response should be required because Classic did not confer with
PissedConsumer on a briefing schedule prior to filing the Motion. D.E. 45. As noted by Classic,
PissedConsumer has flatly refused to cooperatively agree on a briefing schedule for their
response to the Motion. D.E. 47. More than a month has passed, which should have been ample
time for PissedConsumer to respond to the Motion, and Classic would like Your Honor to
undertake review of these issues and direct PissedConsumer to respond to the Motion, or grant
the Motion as conceded.

5. PissedConsumer’s Redaction of “Its Clients”Identities

As described above, PissedConsumer's heavy redactions of its documents have made it

impossible to identify which documents relate to which “client,”how many clients' identities are
reflected on the documents, what “services”PissedConsumer is providing to each, or how much
each client is paying for the services. The Court has already ruled that the plaintiffs are entitled
to this information, but PissedConsumer has failed to provide it. (See February 17, 2011 Hearing
Transcript, at 42:19-22 (“Let's find out what these documents look like, how many of them there
are, what the dollar amounts are, what the terms of them are. You can redact the identity of the
third parties for now. And as we take additional discovery and as I learn more about the case, I
will be open to an application demonstrating need to find the identity of these others. And,
obviously, as the plaintiffs have pointed out, to the extent that they're aware of the identity of
other customers that they learned through sources other than discovery from the defendant
pursuant to a protective order, they're entitled to pursue discovery of those non-parties and learn
whatever that non-party is willing to disclose.”) (emphasis added)).

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At this time, the plaintiffs request that unredacted documents be provided, and the clients'
identities be revealed, for the following reasons. First, as stated above, the heavy redactions
have prevented the plaintiffs from being able to discern even basic information
about PissedConsumer's reputation management programs. PissedConsumer has not
yet identified its clients as “Customer A, Customer B”as it promised, and given the delays to
date in this case, that information may not be readily forthcoming.

Second, PissedConsumer has already provided the plaintiffs with inaccurate information
regarding its clients’identities. At its deposition, PissedConsumer testified that four or five
parties are participating in PissedConsumer’s reputation management program. Opinion Corp.
Dep., at 24:10-22. The plaintiffs have already subpoenaed at least five third parties that they
have evidence are participating in PissedConsumer’s reputation management program, based on
what is displayed on the internet, and received documents in response to these subpoenas.
Plainiffs have since obtained evidence of additional clients and prospective clients of
PissedConsumer's. PissedConsumer has refused to reveal the total number of participants in the
program, or which documents relate to parties already identified and subpoenaed by the
plaintiffs. This is despite the fact that plaintiffs sought this information in document requests and
interrogatories served in November, 2010, and the Court ruled the plaintiffs were entitled to this
information. See, e.g., Ascentive’s Interrogatory No. 2, Nov. 29, 2010 (requesting your clients
“[i]dentify by name, address and telephone number all persons or business entities known to
Defendants to have participated in PissedConsumer’s “Reputation Management Program”);
Ascentive’s Document Request Nos. 5, 5, 17, Nov. 29, 2010 (requesting all documents related to
your reputation management program and the participants in the program).

Moreover, PissedConsumer has refused to provide documents exchanged between

prospective clients, who did not sign a non-disclosure agreement, and PissedConsumer.
PissedConsumer stated in writing that no such documents exist: “Regarding the issue of
potentially responsive documents exchanged between PissedConsumer and a prospective
customer in the absence of an executed nondisclosure agreement (‘NDA’), we have confirmed
with our clients what we stated during our call, namely, that if an NDA was never signed
PissedConsumer did not provide any information regarding its reputation management program.
Accordingly, defendants take the position that where there was no executed NDA, they will not
produce documents exchanged between a prospective customer and PissedConsumer since such
a production could not possibly give rise to information reasonably calculated to lead to the
discovery of admissible evidence.” See Exhibit C.

Today, PissedConsumer's counsel obtained information that VO Group Inc., a plaintiff in

litigation pending against PissedConsumer in the New York Supreme Court, Kings County, was
provided information regarding PissedConsumer’s reputation management services by
PissedConsumer, but never signed a NDA. This is in direct contradiction to the assurance of
PissedConsumer in this litigation. VO Group's complaint against PissedConsumer alleges that
PissedConsumer requested $5,000 from VO Group in exchange for removing defamatory
statements regarding VO Group Inc. from its website.

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PissedConsumer should not be permitted to continue to redact the identities of its clients
from its documents, in light of the false information it has provided to the plaintiffs to date on
this issue.

6. Conclusion

Where PissedConsumer has promised to provide additional discovery and where it has
refused, as outlined above and in the letters between counsel, this Court should order it to do so
by a date certain.

The Court should resolve any objections to the Chase Subpoenas and allow the banks to
produce relevant records.

The Court should order PissedConsumer to respond to Classic’s Motion, or grant this as
conceded.

The Court should order PissedConsumer to reproduce any redacted documents on a date
certain without redactions.

The Court should sanction PissedConsumer for its dilatory conduct and order it to make
full and final production and supplemental responses to discovery once and for all and to pay to
Ascentive and Classic Brands its costs.

Plaintiffs reserve their right to assess PissedConsumer’s discovery responses once

purportedly complete and revisit these issues with the Court if necessary. We are hopeful that a
strong message from the Court to PissedConsumer, that further delays and obfuscation will not
be tolerated, will inspire compliance with the Rules and this Court’s orders.

Finally, and regretfully, we request that the Court revisit the current discovery deadlines.
Despite the diligence of Ascentive and Classic Brands, due to PissedConsumer’s dilatory
conduct, Ascentive and Classic still lack the discovery required to take full and complete
depositions or to provide full and complete information to experts that would be required to write
expert reports.

Thank you for your consideration.

Respectfully,

Matthew C. Wagner
MCW:jrl

CC by ECF and email:

Abbe F. Fletman (counsel for Ascentive)
Joel MacMull (counsel for defendants)
Anna Vishev (counsel for defendants)
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