March 22, 2013
I. ACXIOM AND TRANS UNION DATA THEFT, WIRE AND SECURITIES
FRAUD, TAX EVASION AND EVIDENCE DESTRUCTION
In 2000, Cliff Mortensen contacted Bruce MacLeod of Hennigan, Bennett and Dorman (now McKool, Smith, Hennigan) in Los Angeles, CA to represent him in a wire fraud, data theft and computer hacking federal lawsuit against Trans Union LLC, 555 W. Adams, Chicago, IL and Acxiom Corporation (ACXM) 601 E. 3rd Street, Little Rock, AR 72201. Trans Union was represented by Michael ONeil of DLA Piper, Chicago, and Acxiom was represented by Amy Stewart of the Rose Law Firm (Hillary Clintons former employer) of Little Rock, AR. Mortensen and his companies were defended in a trademark SLAPP suit by Steve Baron, an intellectual property and trademark expert at Mandell Menkes, Chicago, IL. This representation was funded by Mortensens insurance carrier, State Farm.
Acxiom and Trans Union had been secretly stealing and hijacking billions of dollars worth of intellectual property data from Cliff Mortensen and his companies, Credit Bureau of Carmel and Pebble Beach, Inc., Credit Research, Inc. and many other independent Trans Union credit bureau franchisees (unregistered) across the country for at least fifteen years. Trans Union and Acxiom called it data mining. Cliff Mortensens lawyers called it theft and fraud. It is the largest data theft, computer hacking and wire fraud crime in United States history. Trans Union during this period was controlled by the Marmon Group and attorneys Penny Pritzker and Robert Pritzker (d.) of Chicago, IL.
Since no taxes were paid during this data burglary, the United States Treasury was deprived of hundreds of millions of dollars in tax revenue. This is tax evasion on a grand scale.
Trans Unions address is 555 West Adams Street, Chicago, IL 60661. The case (under protective order) number was 00 C 3885 Northern District of Illinois, Judge James B. Moran (d.). This was a peremptory filing by Trans Union for venue choice and filing position. Cliff Mortensen was a defendant and a counter plaintiff in this SLAPP (Strategic Lawsuit Against Public Participation) suit. Dr. George Rock Pring of the University of Denver was the first to identify and name this SLAPP form of malicious prosecution lawsuit.
The data hacking and data hijacking occurred on IBM super computers at Trans Union in
Chicago, IL, Emeryville, CA, and Fullerton, CA, as well as Acxiom facilities in Westlake, CA, and Little Rock, AR, during routine daily database maintenance and batch processing. This data theft occurred in terabyte quantities at nanosecond speeds. Acxiom managed (and managed to steal) the data files on the Trans Union Cronus Database at these and other Trans Union locations. Acxiom and twenty-five Trans Union subsidiaries were granted unlimited access to hundreds of millions of data files most of which were not the property of Trans Union or Acxiom. These files were the information root of millions of Trans Union and Acxiom target marketing lists and credit reports which were sold to most banks and financial institutions for credit making decisions. These privately owned credit files were subject to the copyright laws of the United States of America. They were the intellectual property of the individual credit bureau owners and were subject to royalty payments per contract @ $1.10 per file. These files were stolen property. Acxiom paid Trans Union for this stolen data with hundreds of millions of dollars worth of stock warrants (ACXM).
Trans Union had a fiduciary responsibility to insure the integrity and safety of this data and to redistribute the shared revenue with the lawful owners of this data, the independent Trans Union affiliated credit bureau owners across the United States. Trans Union referred to the affiliation as The Partnership That Works! It appears that the management of Trans Union and Acxiom believed that if the data theft, computer hacking, wire fraud and tax evasion were conducted on IBM super computers at speeds faster than the eye could see, it wasnt really provable theft and no taxes were due. Data theft leaves no evidentiary footprint no matter how often the data is copied or illegally accessed (stolen) and Trans Union and Acxiom knew it. Trans Union passed this stolen data tax free through to its 25 subsidiary companies and Acxiom with no payment to the rightful owners of the data, the independently owned credit bureaus. It was the perfect burglary. Penny Pritzker and Robert Pritzker got their money the old fashioned way-they just stole it when they thought no one was looking!
These actions violated the published code of ethics at Acxiom Corporation and The Code of Business Conduct of Trans Union. When one is stealing billions of pieces of data, one would not want to appear unethical.
This data theft began to occur as Allen J. Flitcraft, formerly with IBM, was leaving as president of Trans Union. Charles Morgan was president of Acxiom Corporation and Harry Gambill was president of Trans Union during this period of wire fraud, data theft, securities fraud and insider trading cybercrimes. Harry Gambill was also on the board of directors of Acxiom Corporation, a publicly traded company, while he was President of Trans Union.
Charles Morgan was abruptly replaced in 2007 after 30 years at the helm of Acxiom Corporation. 2007 was the year Trans Union and Acxiom settled the secret lawsuit with Cliff Mortensen. Harry Gambill has also been replaced at Trans Union LLC and is no longer on the board of directors of Acxiom Corporation. Robert Pritzker (d.) and General Wesley Clark were replaced on the Acxiom board of directors. Most all of senior management at Trans Union LLC and Acxiom Corporation have been replaced after exposure of this data theft. Gen. Wesley Clark has been a registered paid lobbyist for Acxiom.
On May 16, 2007, Acxiom announced a planned sale to Silver Lake and ValueAct Capital for $3.0 billion. The transaction ultimately failed to consummate.
II. RECIPIENTS OF STOLEN DATA IDENTIFIED
INCLUDING TRANS UNION SUBSIDIARIES
Trans Union has been a major stockholder in Acxiom Corporation. At one point, they were the largest single stockholder. They had interlocking directorates. Harry Gambill of Trans Union was on the board of directors at Acxiom. Trans Union was the primary source for the very current credit database content at Acxiom. It was a clone of the database at Trans Union which was a patchwork of stolen and corporate owned data. The payback to Trans Union for the stolen data was in the form of hundreds of millions of dollars worth of Acxiom stock warrants (six million shares), unbeknownst to their shareholders or the ultimate owners of the data-the independent Trans Union credit bureau affiliates, most of whom are clueless that they have been the victims of the largest data hijacking crime in U. S. history.
Trans Union subsidiaries which had unlimited free access to the purloined data are:
Trans Union International Inc.
Source USA Insurance Agency, Inc.
TransUnion International Holdings LLC
TransUnion HealthCare LLC
Diversified Data Development Corporation
Financial Healthcare Systems, LLC
TransUnion Teledata LLC
Decision Systems, Inc.
TransUnion Exchange Corporation
TransUnion Reverse Exchange Corporation
TransUnion Intelligence LLC
TransUnion Rental Screening Solutions, Inc.
TransUnion Consumer Solutions LLC
Trans Union Content Solutions LLC
TransUnion Interactive, Inc.
Title Insurance Services Corporation
Trans Union LLC
TransUnion Marketing Solutions, Inc.
Trans Union Real Estate Services, Inc.
Visionary Systems, Inc.
TransUnion Financing Corporation
These twenty-five subsidiary companies all had free access to the stolen data. The U. S. Treasury was deprived of income taxes due on these felonious transfers of data. Each of these companies required fresh credit data in their daily operations. They received the stolen data directly from the parent company, Trans Union LLC, which stole the data from the independent credit bureau owners while the data was resident on Trans Union computers for daily maintenance. Trans Union operated the largest tax free, stolen data fencing operation in the world. The amount and value of data Trans Union gave to their subsidiaries is almost incalculable. Trans Union never acknowledged nor reported anywhere the amount of stolen data given to their subsidiaries. Barry Botruff, data manager at Trans Union, boldly stated at one Cronus (franchisee) meeting, after thirty days the data belongs to us (Trans Union). He later retracted that statement-a Freudian slip. It is easy to grow a business to twenty-five subsidiaries when your start-up costs are zero!
Trans Union, LLC is a corporate fraud and tax evader par excellence which defrauded over 100 credit bureau owners, credit grantors, investors, The United States Treasury and the truth sensitive capital markets out of billions of dollars. In 1992 Trans Union had the chutzpah to sue the U. S. Federal Trade Commission. Trans Union lost but it allowed them extra sales time.
The major national banks, financial institutions, large credit data users and data brokers, including the United States government, which unknowingly purchased the hacked and stolen data from Trans Union, its subsidiaries and Acxiom Corporation were Chase Bank, Citibank, Bank of America, Wells-Fargo Bank, HSBC, Capital One, Bank One, American Express, U. S. Bank, Discover Card, LexisNexis, and most banks which issued credit cards including First National Bank of Omaha (FNBO). None of these data purchasers did due diligence or certified the rightful owners of these billions of data files. The original acquisition of this data was stolen and therefore tax free. Trans Union has a bountiful history of data theft in the building of their ill-gotten database. Theft is always a tax free transaction particularly at nano-second speeds.
In 1997, FNBO received a $23,000,000.00 court judgment against Trans Union for data theft and breach of contract, case number 8:95CV-57, United States District Court District of Nebraska-Allen Rugg, Esq., of Powell Goldstein for the plaintiff; Roger Longtin, DLA Piper, for the defense. The data theft at FNBO was discovered during a sting operation where FNBO seeded their database with the names of Disney and Warner Brothers cartoon characters with the addresses of FNBO bank branch managers. Shortly thereafter the bank managers began to receive credit card solicitations from competing banks. Trans Union fell right into the briar patch trap and began to illegally access (steal) FNBOs data files without permission or payment. Trans Unions breach of contract cost Trans Union a $23,000,000.00 judgment which they paid. FNBOI had a penalty clause of $100.00 per stolen name. Trans Union has never reported this satisfied judgment on any of their public filings.
For fifteen years, Trans Union, LLC and Acxiom Corporation shared the ill gotten proceeds without paying the rightful owners of the data, the hundred or so local Trans Union franchisees across the United States including the bureau owned by Cliff Mortensen. This wire fraud, conversion and data theft continued for at least ten years before Trans Union admitted to it during settlement of one of the many federal cases against Trans Union. Trans Union admitted to their criminal activity and they wanted all settlements to be secret to avoid scrutiny by The Securities and Exchange Commission, public exposure to the capital markets and The Internal Revenue Service.
Eric Holder, (appointed by Barack Obama), of the Department of Justice, Andrew Cuomo (Attorney General and now governor of New York), Kamala Harris (Attorney General of California), The Internal Revenue Service and the F.B.I. have failed to prosecute these crimes by these Pritzker owned entities. Penny Pritzker is part of the notorious Pritzker family of Chicago (Hyatt Hotels, Trans Union Credit, Trans Union Healthcare, the Superior Bank collapse and the Marmon Group). Penny Pritzkers grandfather and great-grandfather were lawyers for organized crime in the early days of Chicago. Penny Pritzker is a graduate of Harvard University and Stanford University Law School. Penny Pritzker was the finance chair for President Obamas campaign in 2008 and was considered for but not offered the cabinet position of Commerce Secretary in 2009. At this writing, Penny Pritzker is in contention for the Secretary of Commerce Cabinet position again-subject to Senate confirmation.
In 2002 Penny Pritzker was a defendant in a RICO (Racketeering Influenced Corrupt Organizations) lawsuit filed against her in the Superior Bank (Chicago) collapse. For that debacle Penny Pritzker and other Pritzker family members were fined $460,000,000.00 (with a fifteen year payback) by the federal government. Mortensen asked Bruce MacLeod (now with Mc Kool Smith Hennigan, Los Angeles, to file a RICO action against the Pritzkers and Trans Union for wire fraud, extortion and anti-trust crimes. Bruce MacLeod refused to file a RICO or organized crime action against Trans Union and the Pritzkers on several occasions, even though the subject was discussed in Judge Morans chambers.
III. CONFLICTED WORKING RELATIONSHIPS
OF LAW FIRMS
Mr. MacLeod was referred to Cliff Mortensen by his attorney Ralph Wegis, a pioneer in SLAPP lawsuits, of Bakersfield, CA. Bruce MacLeod evaluated the case for twelve months before he decided to accept it. This was a major delay that benefitted Trans Union, Acxiom and DLA Piper. Mr. MacLeod had a prior working relationship with opposing counsel, DLA Piper of Chicago. Both firms worked together successfully on the 1994 bankruptcy of Orange County, CA and later (without Mortensens knowledge) worked together representing John Hancock Life Insurance Company (v. Bank of America) on the international Parmalat (Italy) bankruptcy case. Both firms have represented the Catholic Church in the United States. Michael Hennigan represented the Archdiocese of Los Angeles and hundreds of pedophilic priests. Michael Hennigan and Bruce MacLeod had mutual friends at DLA Piper. Mortensen was not aware of this ongoing conflicted friendship and dual working relationship until August 15, 2012. Mortensen would have never permitted it and would have terminated Bruce MacLeod and Michael Hennigan had he known.
IV. ABUSE OF PROCESS
Initially, Michael ONeil of DLA Piper sued Cliff Mortensen in a SLAPP (Strategic Lawsuit Against Public Participation) lawsuit to quell Mortensens impending lawsuit for data theft, fraud and breach of contract. This was a malicious prosecution case filed by DLA Piper to bankrupt and stifle Cliff Mortensen. This was abuse of the court process. The $1,000,000.00 cost to defend this suit was paid for by Cliff Mortensens insurance carrier, State Farm. Cliff Mortensen was represented by Steve Baron of Mandell Menkes of Chicago. This case settled for $19,000.00. There was no SLAPP Back, malicious prosecution or punitive lawsuits filed on Mortensens behalf. Steve Baron, of Mandell Menkes, did not attend the global settlement conference. He said State Farm would not authorize it! Steve Baron never attended any of the settlement conferences. I guess you get what they pay for.
V. CASE VALUATION
On the first discovery trip to Chicago, the home of Trans Union, Bruce MacLeod mentioned to Cliff Mortensen that if his case were only worth $4,000,000.00 or less his firm would not be interested in representing him. He then excused himself for a lunch meeting with his old pals at DLA.
Bruce MacLeod later indicated the case was worth in excess of $100,000,000.00 per appraisal by Monica Ip, a forensic accountant, at HemmingMorse, San Francisco, due to contract breach and fraud. This appraisal value did not consider the billions of data files which were passed through (tax free) to the twenty-five domestic Trans Union subsidiaries with no royalty payments to the owners of the data including Cliff Mortensen. At a settlement conference in 2004, Anthony Piazza suggested that the case was only worth $400,000.00. Ralph Wegis and Bruce Mac Leod were at that settlement conference. Steve Baron was not present and offered no guidance on value.
VI. CASE SECRECY AND PROTECTIVE ORDER
TO HIDE INSIDER TRADING, STOCK FRAUD
AND TAX EVASION
Bruce MacLeod, Michael Hennigan and Ralph Wegis allowed the case to be filed under seal with a protective order (against the strong protestations of Cliff Mortensen). Mortensen told Bruce Mac Leod on several occasions that he did not approve of this secrecy strategy, yet Bruce Mac Leod insisted on secrecy. He said this would hasten settlement (seven years). This protective order only protected Trans Union LLC and its 25 subsidiaries, Acxiom, Penny Pritzker and the Pritzker family from public exposure of their data theft, wire fraud, stock fraud, tax evasion and anti-trust crimes. Wall Street investors, the capital markets and The Internal Revenue Service would have benefitted from public exposure of these crimes. Bruce MacLeod was asked on at least fifteen occasions to remove the case from protective order, to unseal the filings and to amend the complaint to include anti-trust and RICO pleadings against Trans Union and Acxiom. Bruce MacLeod always refused to amend and would become very irritated whenever the subject was broached by Cliff Mortensen. He stated that the appropriate people knew how to access the file through Lexis Nexis and Pacer case tracking systems. He had an unhealthy fixation with secrecy. Mortensen preferred daylight and openness. This secrecy and failure to amend only accommodated his friends wishes at DLA Piper while ingratiating himself with them for amicable and profitable working relationships while ignoring the demands and best interests of his clients, Cliff and Pat Mortensen.
Secrecy weakened the case and settlement position for seven years. It fortified Trans Unions and Acxioms position by delays and statute of limitations constraints. Secrecy of Mortensens fraud case facilitated insider trading and willful securities fraud by allowing Trans Union to sell out their position in Acxiom stock at around $40.00 per share. Acxiom stock today trades in the $19.00 range. Investors lost a fortune. If Cliff Mortensens theories of data theft were so misguided, as Michael ONeil of DLA Piper stated, why was secrecy paramount in Trans Unions and Acxioms strategy? The answers are insider trading, wire fraud, securities fraud and income tax evasion.
VII. SECURITIES FRAUD AND INSIDER TRADING
Public exposure of their willful securities fraud, wire fraud and tax evasion crimes terrified the management and owners of Trans Union and Acxiom (ACXM), a publicly traded company (NASDAQ). Penny Pritzker eventually planned to take Trans Union public (TRUN). The secrecy and delays benefitted Trans Union and Acxiom by keeping the other franchised credit bureaus, Wall Street investors, The Internal Revenue Service, the capital markets and the Securities and Exchange Commission uninformed about their blatant data theft, wire fraud, willful securities fraud, insider trading, anti-trust and tax evasion schemes. Public exposure of these crimes would have resulted in more lawsuits, sanctions, penalties, possible de-listing from the Exchanges, potential prison sentences, profit disgorgement and significant financial loss for Trans Union and Acxiom with subsequent erosion of stock value in those securities. Trans Union was paid hundreds of millions of dollars in stock warrants by Acxiom for unlimited access to the stolen data. In 2000, Trans Union cashed in their Acxiom stock warrants for hundreds of millions of dollars with an Acxiom stock price around $40.00. They had insider trading knowledge that the data was stolen and therefore worthless. Other investors were not similarly enlightened. Today, Acxiom stock trades in the $19.00 range, a loss of over 50% of Trans Unions unload price of around $40.00. Investors have lost billions of dollars of stock equity. This constitutes willful securities fraud and insider trading.
Public companies are required by The Securities Exchange Act of 1934 to report on their 10-K annual and 10-Q quarterly forms to disclose all significant litigation in which a public company is involved. They are also required to report if their base product belongs to another entity or is stolen. Acxiom and Trans Union failed to disclose this major litigation and the contested data ownership on their 10-K, 10-Q, S-1, and S-4 forms and were willfully violating federal securities law.
Significantly, Trans Unions planned IPO was withdrawn February 17, 2012 and Acxiom began buying back more of Acxiom stock in 2013!
Bruce MacLeod was accommodating Trans Union and Acxiom to Mortensens peril. Cliff Mortensens lawyers by their secret filings enabled Trans Union and Acxiom Corporation in their criminal theft cover up and securities fraud of copyright law protected credit data files, privately owned intellectual property and tax evasion. Even the lead Judge James B. Moran (d.) said he was tired of the ongoing, senseless secrecy.
VIII. SCOPE OF THE DATA THEFT AND BRUCE MAC LEODS FAILURE TO FILE WIRE AND SECURITIES FRAUD
CAUSES OF ACTION
After an error filled initial filing, Bruce MacLeod eventually did some intensive legal discovery work regarding Mortensens claims of fraud, breach of contract and data theft in a first amended complaint. He found that Trans Union and Acxiom had stolen billions of dollars worth of data from individual Trans Union credit bureau franchisees across the United States and over $100,000,000.00 from Cliff Mortensen alone. Mr. MacLeod called it fraud. He never claimed wire fraud or securities fraud. These are felonies and people could have and should have gone to prison. Again, Mr. MacLeod was protecting the upper management and owners of Trans Union and Acxiom. He should have been more concerned with his own clients, The Securities and Exchange Commission regulations, The I. R. S., the capital markets and securities investors who lost hundreds of millions of dollars in this stock manipulation scheme. Mr. Roger Longtin of DLA Piper told one of the court reporters that Bruce MacLeod had cracked the data theft case but he (Roger Longtin) would deny it if queried. Roger Longtin, Michael ONeil, Bruce MacLeod, Michael Hennigan, Amy Stewart, Ralph Wegis and Steve Baron are officers of the Federal Courts. Not one of them reported any Securities and Exchange Commission willful violations by Acxiom or Trans Union.
MacLeod demanded to see the personal computer hard drives of Cliff Mortensen, his son, Cliff Mortensen, Jr., his wife, Pat Mortensen and all of their business computers plus all of Mortensens personal tax and corporate tax filings. Cliff Mortensen asked Bruce MacLeod for discovery reciprocity from Robert Pritzker, Penny Pritzker, Trans Union and Acxiom. Bruce MacLeod flatly refused Cliff Mortensens request. Had Bruce MacLeod done this, the depth of Trans Unions fraud would have been discovered. Investors, the I. R. S. and the capital markets would have been saved or collected hundreds of millions of dollars. As an officer of the courts, Bruce MacLeod was obliged to expose this massive stock and tax fraud.
Bruce MacLeod allowed Trans Union and Acxiom to take Mortensens personal videotaped deposition on ten (abusive) different occasions, yet he never deposed Robert Pritzker (d.) or Penny Pritzker, the de facto owners of Trans Union. Had he done that, the securities fraud and the depth of the theft would have been exposed or Penny Pritzker may have been caught on videotape lying under oath (perjury).
Charles Morgan of Acxiom stated at his deposition Hell, if I had known that data was stolen I never would have paid for it! He did not say he would not have used it; he just wouldnt have paid for it. Did not know it was stolen? He stole it! He was replaced at Acxiom shortly thereafter. He became aware of the theft beginning in 1992.
IX. ANTI-TRUST CYBERCRIMES AND
CONSPIRACY TO COMMIT FRAUD
In an anti-trust move, Experian denied database access to Cliff Mortensen in 2000. Trans Union, in a similar anti-trust move, denied Cliff Mortensen access to his own database in July of 2001. He was forced to terminate twenty employees. This was an extortionate, fraudulent, monopolistic and illegal attempt to force Cliff Mortensen to drop his lawsuit against Trans Union and Acxiom. Trans Union and Experian, which is a British owned company, then aggressively pursued Cliff Mortensens customers in a blatant anti-trust and unfair competition move. Cliff Mortensen asked Bruce MacLeod to enjoin Trans Union from denying Cliff Mortensen access to his own database. Bruce MacLeod refused as it would be too much legal work. It would have also provided cash flow to Cliff Mortensens struggling companies. There was a conspiracy between Trans Union and Experian to destroy Mortensens businesses. They succeeded. Bruce Mac Leod accommodated them by inaction.
Today there are only four major credit companies in the United States. It is a virtual oligarchy. There are no local credit bureaus remaining. 600 independent credit bureaus have closed. The destruction of competition was complete within seven years.
During this access denial period David Emery, Chief Financial Officer of Trans Union at that time, asked Cliff Mortensen Are you ready to talk about signing the contract amendment now? David Emery was clearly committing extortion. Bill Rogers, V. P., said Trans Union would withhold revenue (which they already were doing) unless Mortensen signed the amendment. This also was extortion. Signing the amendment would have allowed Trans Union, LLC and Acxiom Corporation to continue their data theft. Mortensen refused to sign any amendments. Alice Conlon of Trans Union was the credit bureau liaison for the independent credit bureaus and worked for Jay Frank, Jr., V. P. of Trans Union during this period. She is still employed at Trans Union. She threatened (attempted to extort) Cliff Mortensen with the statement that If you dont do what Trans Union wants by amending your contract, they can do plenty to you. They did.
XI. RACKETEERING INFLUENCED CORRUPT
ORGANIZATIONS (RICO) AND TAX EVASION
Trans Union and Acxiom are corrupt organizations which have used extortion, theft, wire fraud, securities fraud, computer hacking, tax evasion and perjury to achieve their profit goals and revenue streams by stealing billions of credit records from individual credit bureaus in tax free transactions. This clearly qualified as a RICO (Racketeering Influenced Corrupt Organizations) action. This is the largest data theft, wire fraud and tax evasion scheme in history. Trans Union would file fraudulent computer green bar printout reports (wire fraud) with Cliff Mortensens credit bureau offices in Salinas, CA (and other locations) on a daily basis for fifteen years. They did not disclose to the Securities and Exchange Commission their stock manipulation, securities fraud, wire fraud, major pending or past litigation or tax evasion.
Mr. Hennigan belittled the value of the Mortensens case on many occasions. He stated the case was only worth $400,000.00; Ralph Wegis said the case was worth $20,000,000.00; MacLeod said the case was worth more than $100,000,000.00.
When queried, Bruce MacLeod did not have an explanation why one of the Pritzker companies, Conwood Smokeless Tobacco, prevailed in a similar unfair competition and anti-trust lawsuit against United States Tobacco for 3 billion dollars including punitive damages (Upheld at U.S. Supreme Court and satisfied). Perhaps it was just superior lawyering. United States Tobacco was forced to issue stock to fund this upheld award. Conwood Tobacco v. U.S. Tobacco was an anti-trust case as was Mortensens. Bruce MacLeod and Michael Hennigan refused on several occasions to include an anti-trust, RICO or criminal pleading in his case. Again, their lack of action protected Trans Union and Acxiom.
Cliff Mortensen was so disappointed in his legal representation at this point that he contacted the law firm of Boies, Schiller and Flexner, LLP for representation. Mr. Boies declined Mortensens case for a variety of reasons.
In a 2006 mediation, John Blenke, chief counsel at Trans Union offered Mortensen $7,000,000.00 to settle with secrecy. Mortensen rejected that offer. This offer was made in the presence of Ralph Wegis and Bruce MacLeod. John Blenke closed the meeting with the statement to Cliff Mortensen Cliff, you can call me at any time to discuss settlement! Cliff Mortensen was taken aback. He thought he had his own legal counsel. What were Bruce Mac Leod and Ralph Wegis being paid for? This was unethical for John Blenke to address Cliff Mortensen as he did. It was equally unethical for Bruce MacLeod and Ralph Wegis not to object and say nothing. Steve Baron of Mandell Menkes was not present at this mediation either. Either he had no interest or State Farm was paying on the cheap!
Since Mortensens case was under seal, Trans Union and Acxiom had no motivation to true up with Cliff Mortensen and settle for their data theft and wire fraud. They did not admit to their theft and wire fraud until seven years later at settlement. Then they wanted a secret settlement as their admission of wire fraud crimes would be embarrassing to Penny Pritzker and the Trans Union organization. It also would have exposed their securities fraud, wire fraud and tax evasion to the capital markets. Bruce MacLeod and Michael Hennigan were always willing to oblige DLA Pipers secrecy wishes even when criminal activity was involved and should have been exposed.
Under Bruce MacLeods guidance the case was progressing very slowly through the courts. Mortensen had large financial obligations and he informed Bruce MacLeod of his dire financial condition for years, yet Bruce MacLeod still deliberately kept the case progression slow and under seal. He suggested that Mortensen borrow $200,000.00 from Ralph Wegis to help his financial position. That money only lasted six months. Bruce MacLeod also suggested that Cliff Mortensen allow all of his real estate investments to go into foreclosure. He was insolvent by 2007 and forced into a weak settlement position. On settlement day, Mortensen was in debt approximately $5,000,000.00 and had already liquidated about $3,000,000.00 of his personal assets. Bruce MacLeod had copies of Cliff Mortensens tax returns. MacLeod has extensive accounting expertise and he understood Cliff Mortensens untenable financial and emotional position. Bruce MacLeods actions had broken Mortensen emotionally and financially. He set him up for minimal settlement. Five years before settlement, Bruce MacLeod had Mortensen petition the Court to explain his financial position to a special master.
XII. DUAL CONFLICTED REPRESENTATION
Incredibly, prior to settlement, Bruce MacLeod suggested that he (Bruce MacLeod) become employed by opposing counsel, DLA Piper or Trans Union to facilitate settlement. His stated theory was that it would entice Trans Union to settle as Bruce Mac Leod would then be barred from accepting any new cases against Trans Union or Acxiom. He told Cliff Mortensen he did not want to litigate with Trans Union or Acxiom again. (Mortensen thought that was the traditional way lawyers got paid). MacLeod stated that it would be illegal for him to decline other similar cases unless he was employed by opposing counsel and/or Trans Union.
Cliff Mortensen was flabbergasted! He believed Bruce MacLeod was either breaking the law or at least violating California State Bar ethics. He could not believe what Bruce MacLeod was saying. Cliff Mortensen told him absolutely not! Mortensen felt this would be legal malpractice and certainly not in his best interest. He no longer had any trust in Bruce MacLeod, Michael Hennigan or their law firm. He began to believe that the fraternal relationship with DLA Piper was even cozier than suspected. On August 15, 2012, Mortensen discovered that both firms had been working together for the John Hancock Insurance Company on the Parmalat (Italy) bankruptcy case and Catholic Church litigation for years. Had Mortensen known this, he would have terminated Hennigan, Bennett and Dorman post haste.
XIII. LACK OF TRIAL PREPARATION
Mortensen was forced into a weak settlement position particularly when Bruce said Dont start believing your own bullshit (not very encouraging). Still, there were no trial ready motions or at issue memoranda filed on Mortensens behalf by any of his attorneys. Bruce MacLeod never demanded a true up of what was owed to Mortensen. This would have exposed the free and tax free pass through of stolen data to the 25 subsidiaries of Trans Union. The delays accommodating Trans Union and Acxiom Corporation continued. The case was not positioned for serious settlement negotiations by either Bruce MacLeod or Steve Baron of Mandell Menkes. Cliff Mortensen was financially broke and emotionally broken and unable to continue with the stalled litigation.
Cliff Mortensens hacked and stolen data was valued in excess of $100,000,000.00 (per contract breach) by forensic accountant and appraiser Monica Ip of HemmingMorse, San Francisco, CA. This figure did not include the value of the stolen data given directly to the twenty-five Trans Union subsidiaries (with no accounting or tax payment). There were at least one hundred other Trans Union franchised bureaus in similar situations.
At the suggestion of Michael Hennigan, the third mediation took place at the law offices of Anthony Piazza of Gregorio, Haldeman, Piazza, Rotman, Feder and Frank, 201 Mission Street, San Francisco, CA, 415.543.3366. This was the first time Mortensen had ever met Michael Hennigan. During mediation, Cliff Mortensen stated to his lawyers that he wanted Trans Union to offer a settlement figure before he did. They all said no that Cliff Mortensen would have to come up with a figure first. Cliff Mortensen felt this would be bidding against himself and not good strategy. His lawyers gave no guidance in developing a settlement strategy or case settlement value during or prior to mediation. Mr. Wegis said Mortensen had fought the good fight but it was time to settle. Mortensens lawyers were silent during the Anthony Piazza meeting. Cliff Mortensen felt he had been set up and railroaded into settlement. Bruce MacLeod, Michael Hennigan, and Ralph Wegis offered no counsel or guidance during the mediation. Mortensen was forced to fend for himself with three of his high powered attorneys present and silent as lambs. Mortensens State Farm Insurance paid ($1,000,000.00+) to attorney, Steve Baron of Mandell Menkes, Chicago, IL, who was absent as was Amy Stewart of the Rose Law Firm representing Acxiom Corporation. Acxiom had an indemnity clause from Trans Union regarding liability. This should have been disclosed in public filings for Acxiom. It was not.
As of this date, Mortensen has not been provided a copy of the signed settlement document from Acxiom Corporation.
XV. SETTLEMENT AND FAILURE TO
CLAIM DISGORGEMENT OF PROFITS
Eventually, during the mediation, Cliff Mortensen proposed a settlement figure of $15,000,000.00. Anthony Piazza said No he would not present the offer to Trans Union. This refusal violated negotiation protocol. Anthony Piazza said the figure was too high but he did not say on what he based his conclusion. He just pulled a number out of the air with no consideration for the professional forensic appraisal of Monica Ip at HemmingMorse. Attorney Anthony Piazza was supposed to be a neutral mediator. His bias toward Trans Union and Acxiom and his lack of neutrality cost Mortensen a fortune. He then beat Cliff Mortensen down to $10,000,000.00. Cliff Mortensens lawyers were silent and did not advocate his position at all. The smirk on Michael ONeils face revealed the incongruity of the settlement.
Bruce MacLeod did not inform Cliff Mortensen of the massive similar cyber crimes litigation in which Trans Union was involved or the fact that Trans Union gave free access to Cliff Mortensens database to all twenty-five of Trans Unions subsidiaries without payment to Mortensen. During mediation, Bruce Mac Leod made no demand for disgorgement of profits from Trans Union or Acxiom. Disgorgement of profits is the legal remedy for theft and fraud.
The case settled on October 31, 2007 for $11,000,000.00. The settlement called for forgiveness of all transgressions known or unknown and global settlement with a non-disclosure (complete secrecy) clause and a $500,000.00 penalty for breach clause. The phrase known or unknown must have related to the undisclosed sales to Acxiom and the free stolen data access and tax free access Trans Union provided to its subsidiaries. This allowed Trans Union to profit from Cliff Mortensens database in present and future undisclosed credit products. Trans Union operated the largest tax free data chop shop fencing operation in history.
Mortensen received $6,000,000.00 and his lawyers received $5,000,000.00. From Mortensens proceeds he repaid Mr. Wegis the $200,000.00 loan from his retirement fund plus interest. He also paid Wood & Porter Attorneys (referred by Bruce MacLeod) $125,000.00 for tax advice since Michael Hennigan said during the mediation that his firm did not dispense tax advice. Bruce MacLeod cautioned Cliff Mortensen to be very conservative with any settlement money as it may be needed it to pay federal taxes. Bruce MacLeod and Michael Hennigan knew it was a net negative settlement. Yet, they remained silent. So much for Super Lawyers and their personal agenda.
Nowhere has this settlement of data theft and secret settlements been publicly acknowledged in required 8-K, 10-Q, 10-K and S-1 filings for Trans Union LLC and Acxiom or elsewhere. This violated Security and Exchange Rules of Disclosure and kept the investors and capital markets uninformed of this data theft litigation. This also violated Internal Revenue Statutes. It is classic tax evasion.
John Blenke, chief counsel for Trans Union, initially offered Cliff Mortensen $7,000,000.00 in 2006 to settle secretly. This should have been public information to protect investors and the capital markets. John Blenkes signature is on the forms 8-K, 10-K, 10-Q and S-1 filings for Trans Union. Acxiom Corporation had similar filing requirements under Securities and Exchange Commission regulations. Trans Union benefitted from insider knowledge and insider trading of Acxiom stock. Trans Union was not forthright in disclosing their data theft and criminal fraud lawsuits and settlements in their initial public offering of Trans Union stock (TRUN). That public offering was withdrawn February 17, 2012.
The day Cliff Mortensen settled for $6,000,000.00 net, he was bankrupt by three million dollars and Bruce MacLeod knew it. He, Ralph Wegis and Michael Hennigan settled Cliff Mortensen into bankruptcy. Bruce Mac Leod had earlier petitioned the Court on Mortensens insolvency yet he denied knowledge of Mortensens finances when he was queried recently by Mr. Eli Morgenstern of the California State Bar, Los Angeles, CA. This was not Mortensens plan for successful prosecution of the case. Cliff Mortensen subsequently defaulted on seventeen real estate loans (mostly government insured) totaling millions of dollars. He felt he was forced to settle as his lawyers had no plans to take his case to trial and the opposition knew it. Cliff Mortensen was not made whole and the subject was never mentioned by Bruce MacLeod, Ralph Wegis , Michael Hennigan, Antonio Piazza, Michael ONeil or Steve Baron.
Two weeks after the mediation and prior to final settlement Cliff Mortensen asked Bruce MacLeod if the mediation was binding. Cliff Mortensen wanted to cancel it. Bruce MacLeod lied when he stated that the mediation was indeed binding and could not be cancelled. This was not true. Cliff Mortensen relied on Bruce MacLeods false statement. This is malpractice.
XVI. DESTRUCTION OF COURT RECORDS AND EVIDENCE
There was a confidentiality agreement on the Acxiom and Trans Union settlement with a $500,000.00 penalty clause if Cliff Mortensen breached it. DLA Piper demanded that Cliff Mortensen destroy all personal court records, documents and digital records of the legal proceedings and evidence. Criminal evidence destruction is a criminal act. Cliff Mortensen did not destroy his court records. Bruce MacLeod maintained all of his legal records and case log history on his computer. He has that digital record today. Two years after settlement Ralph Wegis returned to Cliff Mortensen all legal documents in his possession. Bruce MacLeod refused to do the same when requested. He destroyed them against Cliff Mortensens wishes. This is destruction of evidence of criminal activity. This is a criminal act. Steve Baron of Mandell Menkes never returned Mortensens litigation file.
XVII. INITIAL PUBLIC OFFERING CANCELLED
BY TRANS UNION
In April of 2011, Cliff Mortensen posted the details of the case on Yahoo! Finance message boards. Within 72 hours he received a disturbing telephone call from an irate Bruce MacLeod, McKool Smith Hennigan, who threatened Cliff Mortensen with legal repercussions from DLA Piper and demanded that he take down the offensive posting immediately. Mortensen informed him that he would not remove the posting. Oddly, Bruce MacLeod stated that he did not and could not represent Mortensen any longer. He had attorney Andrew Swartz of Spiering, Swartz and Kennedy of Monterey call Mortensen. Mr. Swartz stated that Bruce MacLeod requested that he call as Mortensen was in need of representation. Mr. Swartz was clueless about the call. Mortensen thanked him for his concern and told him he had no legal issues presently.
The next day Mortensen received another disturbing call from equally irate opposing counsel, Michael ONeil of DLA Piper. He threatened to sue Mortensen for $500,000.00 and to enjoin him from breaching the confidentiality agreement. He demanded that Mortensen take down the Yahoo! Finance posting. Mortensen informed Mr. ONeil that he had every legal right to discuss any federal crimes committed against him at anytime and anywhere he chose. Michael ONeil of DLA Piper queried maniacally Why now? He followed up his request in email format at Cliff Mortensens request. Trans Union was in the process of an Initial Public Offering at $325 million and a financing issue of $645 million. This theft and fraud case secret settlement was potentially an issue of concern at the Securities and Exchange Commission. The capital markets would been exposed to one billion dollars in fraudulent securities issuance. Cliff Mortensens actions alerted the capital markets, The Securities and Exchange Commission and The Internal Revenue Service of significant tax evasion.
Hennigan, Bennett and Dorman (Los Angeles) merged with McKool and Smith (Texas) in September of 2011 to form McKool, Smith and Hennigan in Los Angeles.
The S-4 filing for Trans Union Financing LLC Exchange Offer dated March 1, 2011 was for $645,000,000.00 at 11.375% due 2018. The registration fee of $74,884.50 was paid. The co-registrants were: Diversified Data Development Corporation, Trans Union Healthcare, LLC, Trans Union LLC, Trans Union Interactive, Inc., Trans Union Financing Corporation, Trans Union Rental Screening Solutions, Inc., Trans Union Teledata, LLC, and Visionary Systems, Inc. The address for all co-registrants and the agent for service is John Blenke, 555 W. Adams Street, Chicago, Illinois, 60661. Nowhere in this S-4 filing is there any mention of the stolen data status of Trans Unions database and the secret lawsuits that were settled regarding same. Again, John Blenkes name surfaces.
On July 5, 2011, Ernst and Young filed a Consent form S-1 for Trans Unions Initial Public Offering (TRUN). John Blenkes name was listed on that filing as Executive Vice President and Corporate Counsel for Trans Union. The underwriting investment banks, Deutsche Bank, J.P. Morgan Chase, Credit Suisse, BofA Merrill Lynch and Morgan Stanley were published and the registration fee of $37,732.50 had been paid. The proposed maximum aggregate initial offering was for $325,000,000.00. There was no specific mention of the legal issues with the ownership and past litigation of the database and the paid settlement of $11,000,000.00.
The Trans Union IPO (TRUN) was withdrawn February 17, 2012. Apparently there was fear of potential trouble at the Securities and Exchange Commission regarding undisclosed criminal legal matters at Trans Union.
The 10-Q for Trans Union was filed August 7, 2012 and was signed by Samuel A. Hamood, EVP and Chief Financial Officer and Gordon E. Schaechterle, Chief Accounting Officer of Trans Union. It was certified by Siddarth N. Mehta.
In August of 2011, four months after Cliff Mortensen went public on Yahoo! Finance Message Boards about Acxiom, Acxiom Corporation announced the planned buyback of $150,000,000.00 worth of Acxiom stock. In February of 2013 they raised the amount of Acxiom stock buyback to $200,000,000.00
XVIII. CHANGE OF OWNERSHIP
In 2010, Trans Union was sold to a partnership of Madison Dearborn Partners, LLC. Trans Union was sold again to affiliates of Goldman Sachs GS Capital Partners and Advent International for 3.2 billion dollars in early 2012 shortly after the IPO was withdrawn. Cliff Mortensens actions alerted the capital markets and saved the capital markets from more severe damage due to willful securities violations and fraud. The database of Trans Union is the result of massive criminal data theft and wire fraud. The Marmon Group and the Pritzkers wanted to distance themselves from the criminal activity at Trans Union. The Marmon Group had earlier been sold to Berkshire Hathaway, the company headed by Warren Buffett. The sale was handled by GoldmanSachs. Warren Buffett paid $4.5 billion for 60% control of The Marmon Group (not including Trans Union) in 2008.
Trans Union and Acxiom Corporations have recently cleaned house of upper management. Trans Union has terminated Bobby (Siddharth) Mehta, Trans Unions former president; Oscar Marquis, Trans Unions former Chief Counsel; David Emery, Trans Unions former CFO and COO and Harry Gambill (former president of Trans Union and board member of Acxiom). Gambill is now on the board of directors at Black Oak Partners, of Little Rock, AR, and not affiliated with Trans Union or Acxiom. Charles Morgan (former CEO of Acxiom Corporation) has been replaced. Most of upper management at both Trans Union LLC and Acxiom Corporation have been cauterized.
Chet Wiermanski, former Global Chief Scientist at Trans Union has recently departed Trans Union. While at Trans Union he was responsible for the algorithmic conversions of Trans Unions stolen credit files to credit appends of attributes and characteristics. He is currently employed at Black Oak Partners where he is the expert on Credit InsightTM Solutions. Chet Wiermanski is also a visiting scholar at the Federal Reserve Board in Philadelphia.
Cliff Mortensen has never heard from DLA Piper, Amy Stewart, the Rose Law Firm, Penny Pritzker, Michael ONeil, Bruce MacLeod, Ralph Wegis or Michael Hennigan ever again.
1. Bruce MacLeod filed the case under seal with a protective order against the wishes and demands of Cliff Mortensen. This kept The Securities and Exchange Commission and The Internal Revenue Service uninformed about Trans Unions and Acxioms data theft, securities fraud and major tax evasion.
2. Bruce Mac Leod failed to include causes of action for wire fraud, RICO, anti-trust, SLAPP Back, stock fraud or malicious prosecution lawsuits.
3. Bruce MacLeod failed to file a claim with State Farm Insurance Company for theft of data. Cliff Mortensen had a business policy with State Farm Insurance Company, which would have covered up to $3 million of his theft loss. This would have provided immediate cash flow to Mortensen.
4. Bruce MacLeod failed to disclose that both Bruce MacLeod and DLA Piper (adversary) both represented John Hancock Life Insurance Company v. Bank of America in the Parmalat bankruptcy.
5. Bruce MacLeod failed to disclose that DLA Piper and Hennigan, Bennett and Dorman both represented the Catholic Church and were involved in the Parmalat litigation.
6. Bruce MacLeod allowed ten depositions of Cliff Mortensen (abusive) and no depositions of the Penny Pritzker or Robert Pritzker, the de facto owners of Trans Union and hundreds of millions of dollars worth of Acxiom securities. Cliff Mortensen protested to Bruce MacLeod that this was not fair or in his best interest.
7. Bruce MacLeod demanded to see all of Cliff Mortensens personal and business tax records and none from Penny Pritzker, Robert Pritzker, Trans Union (and subsidiaries) or Acxiom.
8. Bruce MacLeod failed to include extortion claims again