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Paul A. Tyrell (Bar No.

193798)
Ryan C. Caplan (Bar No. 253037)
2 PROCOPIO, CORY, HARGREAVES &
SAVITCH LLP
3 525 B Street, Suite 2200
San Diego, California 92101
4 Telephone: 619.238.1 900
Facsimile: 619.235.0398
5 E-mail: paul.tyrell@procopio.com
ryan.caplan@,procopio.com
6
Attorneys fo r Defendant/Cross-Complainant,
7 BARDAV INC

8 SUPERIOR COURT OF THE STATE OF CALIFORNIA

9 COUNTY OF SAN DIEGO, CENTRAL DIVISION

10

11 PROPER MEDIA, LLC, a California limited Case No. 37-2017-00016311-CU-BC-CTL
liability company; CHRISTOPHER RICHMOND,
12 an individual; and DREW SCHOENTRUP, an CROSS-COMPLAINT for:
indi vidual,
13 (1) BREACH OF CONTRACT;
Plaintiffs, (2) BREACH OF THE IMPLIED
14 COVENANT OF GOOD FAITH
v. AND FAIR DEALING;
15 (3) ACCOUNTING;
BARDAV INC, a California corporation, and (4) VIOLATIONS OF CALIFORNIA
16 DAVID MIKKELSON, an individual, BUSINESS & PROFESSIONS
CODE SECTIONS 17200 et seq.;
17 Defendants, and
(5) DECLARATORY RELIEF
18

19 BARDA V INC, a California corporation, Dept.: C-68
Judge: Hon. Judith F. Hayes
20 Cross-Complainant,
Complaint Filed: May 4, 2017
21 v. Trial Date: Not set

22 PROPER MEDIA, LLC, a California limited IMAGED FILE
liability company; DREW SCHOENTRUP, an
23 individual; and ROES 1 through 30, inclusive, DEMAND FOR JURY TRIAL
24 Cross-Defendants.
25

26

27

28

CROSS-COMPLA INT
DOCS 125263-000001/2926753.5

Defendant/Cross-Complainant BARDAV INC alleges as follows:

2 SUMMARY OF CROSS-ACTION

3 1. Bardav Inc ("Bardav" or "Cross-Complainant") owns and operates the popular

4 Snopes.com website, which it uses to support and advance the quality, authenticity, and accuracy

5 of news media. Bardav and Proper Media, LLC ("Proper Media") were parties to a written

6 contract under which Proper Media agreed to provide certain services to Bardav for the

7 Snopes.com website, subject to Bardav's ultimate discretion. Proper Media failed to perform its

8 contractual and legal obligations and Bardav eventually terminated the contract in accordance with

9 its terms. Proper Media is now wrongfully withholding money owed to Bardav and effectively

1O holding the Snopes.com website hostage by preventing Bardav from moving the website,

11 advertising and other back-end functions to another service provider.

12 2. At the same time that Proper Media is inflicting external harm upon Bardav, one of

13 Proper Media's principals, Drew Schoentrup, is trying to paralyze Bardav internally in an apparent

14 effort to force Bardav to continue its business relationship with Proper Media. Among other

15 things, Schoentrup is purporting to hold a director position within Bardav in an effort to give the

16 appearance that Bardav has a deadlocked board. Similarly, Schoentrup is purporting to control (via

I7 Proper Media) a 50% ownership stake in Bardav, despite the fact that Schoentrup holds, at most, a

J8 20% shareholder interest.

19 THE PARTIES

20 3. Defendant/Cross-Complainant Bardav is, and at all times mentioned in this Cross-

21 Complaint was, a corporation duly organized and existing under and by virtue of the laws of the

22 State of California, and doing business within the State of California.

23 4. Cross-Complainant is informed and believes, and on that basis alleges, that

24 Plaintiff/Cross-Defendant Proper Media is, and at all times mentioned in this Cross-Complaint was,

25 a California limited liability company with its principal place of business in San Diego, California.

26 5. Cross-Complainant is informed and believes, and on that basis alleges, that

27 Plaintiff/Cross-Defendant DREW SCHOENTRUP ("Schoentrup") is and individual who presently

28 resides in Puerto Rico.
2
CROSS-COMPLAINT
DOCS 125263-000001 /2926753.5

employee. and/or alter egos of each of the other co-Cross-Defendants.5 . and each of them. legal or equitable. servant. or otherwise of the 2 cross-defendants named in this Cross-Complaint as Roes 1 through 30. and had effects. 9 7. and on that basis alleges. Cross-Complainant is informed and believes. were the agents. § l 0 and California Code of Civil Procedure section 20 410. employees. 27 Venue is proper in this district pursuant to Rule 1. in the subject matter of this 6 action. exclusive of interest. 28 3 CROSS-COMPLAINT DOCS 125263-00000112926753. . and in doing the 14 things alleged in this Cross-Complaint were acting within the scope of their authority as such 15 agent. and because this case is a cause not given by statute to other trial courts. Venue is proper in this Court pursuant to California Code of Civil Procedure section 24 395. and Roes 1 through 30 are collectively referred to as 1O the "Cross-Defendants" herein. 7 Cross-Complainant will move to amend this Cross-Complaint when the true names and capacities 8 of said fictitiously named cross-defendants have been ascertained. Cross-Complainant is informed and believes. that 4 each of said fictitiously named cross-defendants is liable to Cross-Complainant on the causes of 5 action herein alleged and/or asserts some interest. exceeds 22 $25. 23 10. Cross-Defendants reside and/or transact business within the County of San Diego. whether individual. 13 servants.10 because the acts and omissions alleged herein were committed in the State of California. 11 8. corporate. because these claims are asserted in a cross-complaint to the above-captioned action filed in 25 this venue. 17 JURISDICTION AND VENUE 18 9.2. and 26 the unlawful conduct alleged herein was carried out.2 of the San Diego Superior Court Rules. and with the permission and consent of their co-Cross- 16 Defendants. Article VI. and therefore Cross-Complainant sues said cross-defendants by said fictitious names. and/or alter ego. and on that basis alleges. in the County of San Diego. that at all 12 times mentioned in this Cross-Complaint the Cross-Defendants. This Court has jurisdiction over al I causes of action asserted in this Cross-Complaint 19 pursuant to California Constitution. The true names and capacities. Schoentrup. 21 because this is a civil action wherein the matter in controversy. 6. inclusive.000. Proper Media. are unknown to 3 Cross-Complainant.

(Snopes) 21 * * * 22 Agent: Proper Media. On information and belief. Bardav is a California corporation founded in 2003 by then-husband and wife..provide 26 content and website development services as well as advertising sales and trafficking. Proper Media 16 agreed to provide certain services to Bardav for the Snopes. operating. Mikkelson were each directors of Bardav until Mrs.com website. Proper Media is an "internet media" company founded in 11 2015 by Schoentrup and Richmond. Under the GSA. GENERAL ALLEGATIONS 2 11. On or about August 11. the Publisher wishes to retain the Agent to . LLC 23 * * * 24 WHEREAS. The GSA was premised on the following recitals: 20 Publisher: Bardav. in addition to his position as director. Mikkelson sold her ownership 7 interest in 2016. and Mrs. and 25 WHEREAS. 2015. p. Mikkelson became the sole member on the Bardav board of 8 directors. This action concerns the operation and control of the Snopes. Mikkelson is the President.com website during the term of the 17 agreement. Mr. and 12 representing web properties. A true and correct copy of the GSA is attached as Exhibit "A" hereto and is 18 incorporated by reference herein.) 4 CROSS-COMPLAINT DOCS 125263-000001129267535 ." 13 The General Service Agreement 14 13. after which Mr. Bardav and Proper Media entered into a written one- 15 year contract entitled the General Service Agreement ("GSA"). as set forth in this Agreement (the 27 "Agreement") 28 (Exhibit A. Proper Media advertises itself as owning. Since its formation. CEO and 9 50% shareholder of Bardav.com website. 10 12. 19 14. Bardav has been the ownership entity for the 5 Snopes. 4 David and Barbara Mikkelson. which is 3 owned by Bardav. working with website "publishers" and "advertising partners. The Publisher is the owner and/or operator of Snopes. 6 Mr. Inc. Mikkelson first began as a personal project in as early as 1994.com (the "Website"). I. which Mr. Today.

2015 4 "Term" means the period commencing upon the effective date and ending upon the termination of this agreement in accordance with 5 Section 7.) 7 7. 13 14 (Exhibit A. 5 CROSS-COMPLAINT DOCS 125263-000001/2926753.1. 4. 1 15. Among other tasks.5 . prior to the IO expiration of the Initial Term. Proper Media contracted to represent Bardav with respect to 28 advertisement procurement. and 2 thereafter reverted to renewable monthly terms until such time it is terminated by either party: 3 Effective Date: August 11. with or without cause. subject to Bardav's ultimate discretion. Unless previously terminated by notice as provided above.) 25 17.§ 7. Term: This Agreement shall remain in effect for a period of one (I) year from the date hereon (the "Initial Term"). 2. § 7. and editorial guidelines. 1. Under the GSA. or 21 (ii) Agent is in material breach of any term. p. placement. p. 23 24 (Exhibit A . The GSA also provided for immediate termination for cause upon Proper Media 16 breaching and failing to cure within ten days: 17 7. at the end of the Initial Term this 11 Agreement shall renew for additional one (1) month terms (each a "Renewal Term") unless and until either party provides the other 12 party with written notice of termination.2. p.2. Either party may 9 terminate this Agreement by providing the other party with sixty (60) days written notice.1. (See Exhibit A.) 15 16. 2015. The GSA had an initial term of 1-year commencing on August I I. Termination by Publisher: Publisher may terminate this Agreement by written notice to Agent if any of the following events 18 occur: 19 (i) Agent fails to pay any amount due to Publisher within ten (10) days after Publisher gives Agent written notice of such 20 nonpayment. Term & Renewal 8 7 . 6 (Exhibit A. with or without cause. or provision of this Agreement and such breach is not cured 22 within ten (10) days after Publisher gives Agent notice of such breach. and management. Bardav retained ultimate decision making on issues regarding 26 staffing. p. content. condition. 4. at least sixty (60) days prior to renewal.) 27 18.§ 1.

excluding taxes based upon Agent's net income.3. p.) Proper Media also agreed to use 3 its best efforts to ensure that the information in its tracking system was accurate.) 28 6 CROSS-COM PLAINT DOCS 125263-00000 112926753. § 4. (See Exhibit A.7. the next business day. Proper Media was obligated to pay Bardav sums owed under the GSA within forty- 16 five (45) days of the end of each month. (Exhibit A.1.) 24 22. p. 3. The remaining advertising revenue constituted the entirety of Proper Media's 12 compensation (exclusive of authorized expense reimbursements) under the GSA: "Other than the 13 commissions in this Section. § 3. 22 state or local governmental entity on the transactions contemplated by this Agreement.5. Agent shall not be 14 entitled to any fixed compensation for its services. Agent Commission Rate: The Agent shall pay to Publisher all amounts invoiced or to be invoiced by the Agent to advertisers for 8 advertising placed on the Website up to $85.com website: "Agent's Obligations: Agent shall invoice and collect all 26 advertising revenue from Advertisers for content sold by Agent for placement on the Website. if it falls on a 21 weekend. p. 10 (Exhibit A. § 3. 23 (Exhibit A. § 4. 2. 3. 9 calculated on a monthly basis ("Net Revenue").1 . Publisher is responsible for all sales taxes.) 11 20. 4 p." (Exhibit A. use taxes and any other similar taxes imposed by any federal. Payment to Publisher: Regardless of whether the Agent has 19 been paid by all Advertisers.§ 3. 2. the Agent shall pay Publisher the Net Revenue for each month no later than forty-five (45) days from the 20 end of the month for which advertising was run on the Website provided that that the 45th day falls on a weekday and.§ 3. The GSA further provided that Proper Media would compensate Bardav based on 6 advertising invoicing on a monthly basis: 7 3." 27 (Exhibit A.) 5 19. p. and the expense reimbursements in Section 5. p.S . (Exhibit A.2. 3.) In connection therewith. § 3. Proper Media agreed to provide Bardav with 2 advertisement trafficking and reporting.) 15 2 1. 3.3. Proper Media was contractually obligated to invoice and collect all advertising 25 revenue for the Snopes. regardless of whether Proper Media had received payment 17 from the advertisers: 18 4. p.000 per month (the "Baseline") and fifty (50) percent of all amounts above the Baseline. 2.5.

Importantly.S . 10 25. David and Barbara Mikkelson divorced. 2016. the SPA contains an express integration provision.33% 16 17 26. 27 28 1 The SPA contains a confidentiality provision and therefore Bardav is not attaching a copy to this public document. in the following percentages: 13 Name Purchase Percentage Overall Ownership in Bardav Drew Schoentrup: 40% 20% 14 Christopher Richmond : 40% 20% Tyler Dunn: 6.68% 3. 7 The Stock Purchase Agreement 8 24. after which each retained an 9 independent fifty percent (50%) ownership interest in Bardav. The SPA was not 22 accompanied by any corporate resolution appointing Schoentrup or any of the other purchasers to 23 Bardav's board of directors. the SPA does not provide that any of these acqumng individuals. 23.com 2 website or to control its hosting. Richmond. On or about July 1.]" without granting Proper Media ownership or 5 control over those servers. the above-identified persons in 18 their individual capacity. the GSA did not require or enable Proper Media to host the Snopes. 7 CROSS-COMPLAINT DOCS 125263-00000 1/2926753. Rather. 1 12 and non-parties Tyler Dunn. Notably. Under the SPA. 24 28. the shares were sold to. In 2015. Barbara Mikkelson sold her 50% ownership interest in Bardav to Schoentrup.33% Ryan Miller: 6. 21 including Schoentrup. Likewise. would obtain a position on Bardav's board of directors.34% 15 Vincent Green: 6.66% 3. pursuant to a written Stock Purchase Agreement (the 11 "SPA"). and Ryan Miller.66% 3. confirming that it 25 represents the entirety of the agreement reached with respect to the acquisition and ownership of 26 these shares. and held by. the GSA provides that "[Proper Media] shall consolidate 3 [Bardav's] existing server configuration to use load-balanced Linux servers paired with a MySQL 4 database server and a content delivery network[.com website remained within Bardav' s sole ultimate discretion. the decision of how and where to host the 6 Snopes. 20 27. At all relevant times. Vincent Green. The SPA makes no mention of any of these parties holding their shares 19 for the "benefit" of Proper Media.

Mikkelson was purchased by. over time. on May 7. such 5 as Proper Media. 27 Schoentrup has held himself out as a Bardav board member. 6 Proper Media Fails to Perform Under the GSA. On or about March 9. Presumably based on this false 28 assertion. such that the GSA would terminate in sixty (60) days 19 (i." Presumably based on this false 23 assertion. 21 32. 29. 17 2017. During the one-year term of the GSA. its shares cannot be held by companies but 2 must instead be held by individuals. including 8 CROSS-COM PL.com Website and Other Assets Hostage 8 30. Schoentrup has improperly attempted to exercise rights of a Bardav director. unless otherwise terminated earlier for cause. Despite no corporate resolution appointing him to Bardav's board of directors. and when Bardav could obtain the services it needed from 14 other vendors at significantly lower cost. Messrs.. 4 Dunn. 15 31. Mr.5 . Proper Media repeatedly failed to remit 9 timely payments that were owed to Bardav. and Miller in their individual capacity. Proper Media stopped performing 1O certain functions under the GSA and generally failed to perform at a sufficiently high level. attempting to appoint directors. and attempting to 25 inspect corporate records.com when Proper Media was not providing value 13 commensurate with its compensation. with or without cause. and not for the benefit of any company. As noted above. Richmond. Consistent therewith. Proper Media has improperly attempted to exercise rights of a Bardav shareholder. 26 33.e. and continues to be held by. Bardav gave Proper Media written notification that it was terminating the GSA pursuant to 18 the Term & Renewal Section of the GSA. 11 Further.A INT DOCS 125263-00000112926753. Mikkelson. Further. Despite holding no ownership interest in Bardav. As a result of Bardav's S-Corp status. Proper Media has recently held 22 itself out as "the beneficial owner of 50% of the shares in Bardav. Green. is Terminated and Then Holds the 7 Snopes. Bardav concluded that it no longer made sense to allow Proper Media to siphon off large 12 sums of advertising revenue from Snopes. The notice was sent by 20 Bardav's director and President. the Bardav ownership interest sold by 3 Ms. the GSA's express language granted Bardav the right to terminate 16 the GSA at any time. 2017). Schoentrup. 24 including attempting to call a special meeting. on sixty (60) days' notice.

8 35. 3 34. attempting to appoint directors. Proper Media and Roes 1 through 30 expressly agreed to . and attempting to inspect corporate records. 20I 7.) 18 38. except as prevented and/or excused by Proper 20 Media and/or Roes 1 through 30. Cross-Defendants failed and refused to comply with Bardav's written demand. 25 b. Cross-Complainant incorporates by reference each and every allegation contained in 13 each paragraph above and below as though the same were set forth in full herein. 2015. 21 39. covenants. failing to provide trafficking and reporting to Bardav. and 9 are instead holding hostage the requested information and data belonging to Bardav. attempting to call a special meeting. 14 37. 20 I 7. Bardav. among other things: 24 a. 10 FIRST CAUSE OF ACTION II (Breach of Contract against Proper Media and Roes 1 through 30) I2 36.5 . Bardav made a written demand upon Proper Media for 4 certain information and data relating to Bardav and the Snopes. and Roes I through 30 entered 15 into a written General Service Agreement (the GSA). during the term of the agreement. and 26 c. Proper Media and Roes 1 through 30 have 23 materially breached the GSA by. 22 abide by the terms of those agreements with Bardav. failing to make payments of revenues owed to Bardav under the GSA.com website. (See Exhibit A. of which Bardav is 5 the legal owner. 28 9 CROSS-COMPLAINT DOCS 125263-00000112926753. custody. Bardav 6 emphasized the time-sensitive nature of this demand and requested compliance by the close of 7 business on May 22. attempting to manage business 2 decisions. but is presently in Proper Media's possession. and promises required on its 19 part to be performed in accordance with the GSA. or control. Bardav has fully performed all conditions. Proper Media. On or about May I 9.com website. By entering into the GSA. under which Proper Media and Roes 1 16 through 30 agreed to provide certain content and website development and maintenance services to 17 Bardav for the Snopes. failing to perform in other ways that may be revealed m the course of 27 discovery. On or about August 11.

As a direct and proximate result of these breaches of the GSA by Proper Media and 2 Roes 1 through 30. 20 b. 8 42. except as prevented and/or excused by Proper 14 Media and/or Roes 1 through 30. 40. 15 44.com website and infrastructure. 3 SECOND CAUSE OF ACTION 4 (Breach of the Implied Covenant of Good Faith and Fair Dealing 5 against Proper Media and Roes 1 through 30) 6 41.com website.5 . failing and refusing to provide Bardav with access to all Bardav's electronic 25 communications as well as data for the Snopes. Cross-Complainant incorporates by reference each and every allegation contained in 7 each paragraph above and below as though the same were set forth in full herein. of which Bardav is the legal owner as 26 recognized under the GSA. covenants. failing and refusing to provide Bardav with information concerning the 18 Snopes. of which Bardav is the legal owner as recognized under the GSA. and Roes 1 through 30 entered 9 into a -wTitten General Service Agreement (the GSA). Bardav has suffered damage. failing and refusing to provide Bardav with a copy of the codebase for the 21 Snopes.com website. 2015. of which Bardav is the legal owner as recognized under the GSA. according to proof at trial. 24 d. failing and refusing to cooperate with the transition of the Snopes. among other things: 17 a. Bardav. 10 CROSS-COMPLAINT DOCS 125263-00000 I/2926753. failing and refusing to provide Bardav with access to the repositories for the 23 Snopes. Proper Media and Roes 1 through 30 16 unfairly interfered with Bardav's right to receive the benefits of the GSA by. 22 c. Bardav has fully performed all conditions. On or about August 11 . plus interest thereon.) 12 43. during the term of the agreement.com 28 website and other backend functions to another service provider. Proper Media. (See Exhibit A. and promises required on its 13 part to be performed in accordance with the GSA.com website. and 27 e.com website. During the course of the term of the GSA. of which Bardav is the legal owner as recognized under the 19 GSA. under which Proper Media and Roes 1 1O through 30 agreed to provide certain content and website development and maintenance services to 11 Bardav for the Snopes.

Proper Media. 17 50. (See Exhibit A. 3 46.com website. Under the GSA. 24 53. 10 48. 2015. The amount of money due from Proper Media and Roes 1 through 30 to Bardav for 25 net revenues is unknown to Bardav and cannot be ascertained without an accounting of Proper 26 Media's and Roes 1 through 30's books.com website. Proper Media and Roes 1 through 30 are obligated to provide 18 trafficking and reporting to Bardav regarding all advertising placed on the Snopes. As a direct and proximate result of Proper Media's and Roes I through 30's 4 breaches of the implied covenant of good faith and fair dealing in the GSA. 45. contracts. 27 28 11 CROSS-COMPLAINT DOCS 125263-00000112926753.com website during the term of the GSA. or to be invoiced. Proper Media's and Roes 1 through 30's obligations under the GSA include paying 15 Net Revenues to Bardav generated by advertisement revenue invoiced. records. Proper Media and Roes 1 through 30 are obligated to invoice and 20 collect all advertising revenue from advertisers for content sold by Proper Media for placement on 21 the website. On or about August 11. according to proof at trial. during the term of the agreement. for placement on the Snopes. or to be invoiced. The acts alleged herein constitute a breach of the GSA's implied covenant of good 2 faith and fair dealing in that they interfered with Bardav's right to receive the benefits of the GSA.5 . and Roes 1 through 30 entered 11 into a written General Service Agreement (the GSA). Bardav has suffered 5 damage. plus interest thereon. under which Proper Media and Roes 1 12 through 30 agreed to provide certain content and website development and maintenance services to 13 Bardav for the Snopes. 6 THIRD CAUSE OF ACTION 7 (Accounting against Proper Media and Roes 1 through 30) 8 47. Cross-Complainant incorporates by reference each and every allegation contained in 9 each paragraph above and below as though the same were set forth in full herein. Under the GSA. Proper Media and Roes 1 through 30 have failed to pay Bardav net revenues owed 23 to it for advertisements invoiced. by Proper 16 Media and Roes 1 through 30 for the Snopes.com website. 19 51.) 14 49. Bardav. and financials. 22 52.

17 Among other things. 4 FOURTH CAUSE OF ACTION 5 (Violation of California Business & Professions Code § 17200 et seq. Cross-Defendants have been unjustly enriched in an 22 amount subject to proof at trial. refusing to use commercially reasonable efforts 13 to obtain payments from advertisers that are owed to Bardav. holding hostage the Snopes. This unlawful. Cross-Defendants' conduct was and is unlawful. Schoentrup to try to paralyze Bardav 19 appear designed to prevent Bardav from doing business with Proper Media's competitors and to 20 discourage those competitors from doing business with Bardav. 1 54. 23 58. 6 against all Cross-Defendants) 7 55. refusing the remit 12 revenues intended for Bardav in their possession. Cross-Complainant incorporates by reference each and every allegation contained in 8 each paragraph above and below as though the same were set forth in full herein. Cross-Defendants' acts include. As a result of their conduct.5 . without limitation. 9 56. Bardav has 24 suffered irreparable harm as a result of Cross-Defendants' activities and will continue to suffer 25 irreparable injury that cannot be adequately remedied at law unless and until enjoined and 26 restrained by this Court. Bardav is entitled to injunctive relief and other equitable remedies. and Bardav is entitled to restitution and disgorgement remedies. Proper Media and Roes 1 through 30 have failed to tender an appropriate accounting 2 of the aforementioned monies invoiced or to be invoiced. the acts alleged herein have effectively prevented Bardav from doing business 18 with competitors of Proper Media. constituting 1O unfair competition and unfair business practices under California Business and Professions Code 11 sections 17200 et seq. unfair. 27 28 12 C ROSS-COMP LAINT DOCS 125263-00000 1/2926753. infrastructure information and files for which Bardav is the legal owner. 21 57.com 14 website. unfair. and fraudulent conduct constitutes unfair 16 competition and unlawful business practices relative to Bardav as well as others in the industry. and other acts 15 and omissions as set forth herein. and the efforts of Mr. thereby entitling Bardav to equitable 3 relief in the form of an accounting of all amounts owing under the GSA. and fraudulent.

7 61. Proper Media is not entitled to withhold the codebase for the Snopes. 15 d. For consequential damages according to proof.com website. Proper Media is not entitled to withhold access to Bardav's email. 19 g.com website.com 12 website from Bardav. Cross-Complainant incorporates by reference each and every allegation contained in 4 each paragraph above and below as though the same were set forth in full herein. Proper Media does not possess an ownership interest in Bardav. The GSA was terminated effective of May 7. 18 f. including a declaration that: 9 a. Cross-Complainant prays for judgment as follows : 26 I. For actual damages according to proof. 13 c. and rights attendant thereto. Slack 16 communications. 13 CROSS-COMPLAINT DOCS 125263-000001 /2926753. 5 60. Schoentrup does not hold a position on Bardav's board of directors. 11 b. For special damages according to proof. Proper Media is not entitled to withhold access to the Snopes.com website from Bardav. and not for the benefit of Proper Media. Bardav desires a judicial determination of the parties' rights and duties concerning 8 Bardav and the Snopes. Proper Media is not entitled to withhold infrastructure information regarding IO the Snopes. 27 2. 28 3.com website is within 23 Bardav's sole discretion. and 22 1. l FIFTH CAUSE OF ACTION 2 (Declaratory Relief against a1J Cross-Defendants) 3 59.com website 14 domain and repositories from Bardav. 17 e. 2017. The decision of how and where to host the Snopes. A dispute has arisen between the parties with respect to Cross-Defendants' alleged 6 ownership interests in Bardav and the Snopes. 21 h. 24 PRAYER FOR RELIEF 25 WHEREFORE. Schoentrup owns a twenty percent (20%) interest in Bardav in his individual 20 capacity. and Asana project management data messages from Bardav.5 .

10 b. 14 d. advertising revenues invoiced or to be 2 invoiced to advertisers during the term of the GSA and revenues owed to Bardav 3 under the GSA. The GSA was terminated effective of May 7. Proper Media is not entitled to withhold the codebase for the Snopes. For interest at the maximum legally permissible rate from the date of the initial 25 breach(es). For restitution and/or disgorgement of ill-gotten gains. Proper Media is not entitled to withhold access to the Snopes. 7 7.com website from Bardav. Schoentrup owns a twenty percent (20%) interest in Bardav in his individual 20 capacity. 12 c. For an accounting to determine. 21 h. Proper Media is not entitled to withhold infrastructure information regarding 9 the Snopes. 4 5. 26 I II 27 II I 28 14 CROSS-COMPLAINT DOCS 125263--000001/2926753 5 . For injunctive relief enjoining Cross-Defendants from engaging in acts of unfair 6 competition and unlawful business practices. 19 g. Proper Media does not possess an ownership interest in Bardav. 4.com website 13 domain and repositories from Bardav. 2017. 17 e. 5 6. Schoentrup does not hold a position on Bardav's board of directors.com website is within 23 Bardav's sole discretion.com 11 website from Bardav. and not for the benefit of Proper Media. The decision of how and where to host the Snopes. and Asana project management data messages from 16 Bard av. Slack 15 communications. 18 f. For a judicial declaration that: 8 a. and 22 1. 24 8. inter alia. Proper Media is not entitled to withhold access to Bardav's email.

3 4 DATED: June 7 .-:. Caplan 8 Attorneys for Defendant/Cross-Complainant. BARDJ\V INC 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 15 CROSS-COMPLAINT DOCS 125263-00000112926753. For costs of suit incurred herein.) By: 7 Paul A. For such other and further relief as the Court deems just and proper. 20 17 PROCOPIO. and 2 10. ell Ryan C. HARGREAVES & SAVITCH LLP 5 6 .5 . 9. CORY..

. EXHIBIT A .

do hereby agree as follows: Effective Date: "Term" m eans the period com mencing upon the effective date and ending August 11. The Publisher wish es to retai n the Agent to provide content and website development services as well as advertising sa les and trafficking. Inc. and WHEREAS. LLC Jurisdiction of O rgani zation: Californ ia Addre ss: City: State: 41 55 Mission Blvd . in consideration of the mutual promises contained herein. and for other good and valuable consid eration. NOW. The Publisher is the owner and/or operator of Snopes. GEN ERAL SERVICES Publis her . 2015 upon the termination of t his agreeme nt in accordance with Section 7. TH EREFORE .snopes.com Address: City: State: Country: I Zip: I Phone: I Contact Person: David Mikkelson Phone: E-mail : Agent: Proper Media. collectively. as set forth in t his Agreement (the "Agreement").. (Snopes) Jurisdiction of O rga n ization: URL of Publisher: www.com (the "Website"). the Agent and the Publish er (each a "Party" and. intending to be legally bound. the " Parties"). San Diego CA ' -- Country: USA I Zip: 921 09 Phone: (509) 995-5654 Contact Person: Drew Schocntrup Phone: (509) 995-5654 E-mail: drew@proper. Bardav. io WtiEREAS. CO NFIDENTI AL . the receipt and sufficiency of which are hereby acknowledged.

be used on the live of the Website. '!r. t he solicitation of Website adv erti sing purcha ses directly from Advertisers (including Exchanges.J. m. relevan t articl es (" Content" ) and publishing sv-"' Comcnr to th e Website . and average CPM on a daily basis. :i ·d ·codcd r: associat ed with these doma'n<... not of Publi. 1.1 It Is en visioned thrit the consolidation will ir---· 1sc the redu ndancy. Placement an d Management: Agen t shall place and manage all advertisements t hrough its ad-server and will be responsible for al l aspects of ensuring ad vertisement s are served properly.3. Agen t shal l migra te .'er an d a content delivp···. "native" and in- content ads. Dispu tes : In the event a dispu te a rirr. 1. c. Adve r frrn m ents 3 . Agent shall be responsible to maint ain th e servers described herein and to make all reasonable ·"· ·t s to m <J xim':r: up·ti. Representation: Agent shall represen t Publisher with respect t o the placement of advertisements on t he Publisher's Website.1ins : The Website currently soans rr.tructu re 2. and of the 1... impressions served. for t h e p:_irpose of generating high quality.-"T'"'lt: Agent sh all extend Publisher's existing WordPrrc.2. which..> <>rl. 2. including without lim itation. Agent sh all ail :1('} rna in 5 wit h rhe Websit e to r: .PROP2 R In con sideration of t he t erms and conditions set forth herein.4.0lve such a dispu te. Fu -· . Publisher maintains t he right to refu se to run any ad type or placemenr.1. on t ime. Design : The Webs.com and new. Agencies.. 3.tr "... 2 . Agent shall provide trafficking and r eporting to Publisher .. · CONFIDENTIAL . Publisher will retain sole discretion on how t o r<>c. Content Man2-. to support and en hance the Stt:ff'<.c guidel ines t hrough the Content System described in Secti on 2.3 License Gran t : Publisher h ereby grants Agent the prima ry exclu sive right to sell and ma rk et all advertisements on the Website during the t erm of this agreement..sive.-..r. to . w ill · M1 !n over finJ I theme and t :-. Content or Editorial Guidelines. an d efficiency of the Websi te. W e bsite Cont ent Ll.sn opes .1pes c:-: -n.rm pl atcs and th emes shall design a mobile -first re spo.. both vira l an d historical. Q(')rr. and appropriately ta rg eted. Agent w ill be -""'")On sible to cr.4.ooes com. incorporating plugins and tools as necessa ry. L1ltiple domains. all of whom shall be or independen t contractors of Agen t . Content Managemt'-.t ion.. Agent shall use its b est efforts to ensure that the information in its online t racking system is accurate.r Sys tem dc<. etc.r's d•--·. including sr. between Publisher and Agent regardi ng the Staff.ponding serve r re lated exp enses.i. In conn ection with the foregoing. and efficiency for the Website. identifi es the revenue earned. Agent shall recruit . 3. cu -rent design soans a number of pDge . blish editorial guidelines fo r th e Content . Demand Side Partners. It is anticipa ted t hat the Content will include news related to currcrH even ts as w ell as research and fact checks related to rumor'> and myths. Content Management System.bliShN and Agent shall work t ogether to e ..Engine Optimi1m ion and link struct ures. ability to develop an d publish C0n· --it. Infra <.'orc e th c<.) for placement on the Website. 3.r--'bed 1n Secrion 2. and editors ·· s taff") . 2 . Edi· Guidelines : P. 3.2 Online Tracking System: Agent shall maintain an online tracking system... srr. 2. Staff: At Publ'-" . 2. 1. un:fied theme and redeveiop the variou s templ ates to to t his t h eme . Bran ds. Utilizing practices rhat will preserve existing Ser ···'.1..sn opes... among other thin gs.com .. bann er and video advertisem ents. train and m1nage a staff of w riters. the Parties hereby agree as follows: 1. and the re porting of th e resu lts th erefrom to Advert isers and the Publisher . Serv"'s: Agent shall con solidate Publisher's e xisting server con fig uration to use load -balanced Lin ux servers paired with a MySQL database scr\. Additionally. while <1t th e same time lowerin g the cc ··.

000 per mon th (the "Baseline") and fifty (50) percent of all am ount s above the Baseline. Agent sha ll be responsible for making such pay m ents to the Staff and deduct ing t his amount from t he Net Re venue. calculated on a monthly basis ("Net Revenue").3 .2. Reporting which is attached hereto as Exhibit "A. bot.4. In frastruct ure : A S2 . Collections : will use commerciall y reasonable efforts to collect any mon ies owed to Agen t by Advertisers. Agent's Expenses : 5. 5. 4 . or as a result of other breach of this Ag reemen t by Publisher for an y applica ble pa y period. excluding taxes based upon Agent's net income .:R 3 . ComScore Assignment: Publisher shall sign the Tra ffi c Assignment Request for Com Score Inc. 5. Additiona l ExpC'n<.1. if it falls on a weekend.2.7.3 . use ta xes and any other sim ilar ta xes imposed by any federal. 1. 6. Marketing/Public Re lations 6 . and the expense reimburs em ents in Sect ion 5. Billing & Payr:nent 4.5. 4. (c) or impressions co-mingled with a significant number of fra udulent impressions or frau dulent clicks described in (a) above. Paymen t to Publisher: Regardless of whether the Agent has been paid by all Advertisers. state or local governmental entity on t he transactions contemplated by this Agreement. 4. 5.6. (b) ads delivered to end users wh ose browsers have the ads disabled. Revenue Derived by Fraud: Agent shall not be liable for any paymen t based on (a ) any fra udulent impressions gene rated by any person. Agent may refer t o the Publisher and t he Website in Agent's cor porat e web site. the next business day. Publisher is responsible for all sales taxes. Agent' s Obligations : Agen t shall invoice and collect all advert ising revenue from Adv ertisers for content sold by Agent for placement on the Website.PROPJ. 4 ." 3 .500 monthly fee for t he In frast ru ct ure described in Section 2. 1. Staff: Expenses paid d irectly to t he Staff described in Section 1. Other t han t he commissions in this Section. 3. CONFIDENTIAL .e'> Expenses: 5. Budget : Agent shall provide to Publisher a m on t hly budget of all expenses for Publisher's pri or approval and shall not exceed this budget by m ore than 10% withou t express written approval of Publisher . automated program or sim ilar device or for fraudulent clicks similarly generated on any ad. including expenses for Servers and expenses incurred as a result o f hiring third-party independent contractors for website related development.2 . as reasonably determ ined by Agent.1. Agent Commission Ra t e: The Agent shall pay to Publisher all amounts invoiced or to be in voiced by the Agent to advertisers for advertising placed on the Websi te up to $85. press relea ses and m ar keting collatera l . Agent reserves the right to withhold in th e event of any breach of this Agreemen t. the Agent shalt pay Publisher the Net Revenu e for each m onth no later than forty -five (45) days from th e end of the month for which adverti sing was r un on the Website provided that that th e 4 5th day falls on a weekday and. Agent shall not be entitl ed to any fi xed compensa t ion for its serv ices.4 Agent shall be responsible to pay for all expenses incurred from the Infrastructure described in Section 2 in excess of Publisher' s fee set forth in Section 5.

but not limited to.her shall notify Agent of t he receipt of an o ffer to purr'. condition. losses. costs. without limitation.. (iv) the Website does not and will not contain any content which violates any applicable law or regu lation. at least sixty (60) days prior to renewal. a "Claim"). condition.: Website for t he same price and on the sam e rr -. is herebv gran te d a r'-"lt refusal to purchase all or a port ion oft'--. or provi sion of this Agreement and su ch bre ach is not cured within ten ( 10) days after Agent gives Publisher notice of such breach. 10. and hold harmless the other Party. fi nes...i the r.. (ii) Publisher is the owner of th e Website or legally authorized to act on behalf of the owner of such Website for the purposes of this Agreement . penalties. suit or proceeding m ade. at the en d of the Initial Term this Agreement shall renew for additional on e ( 1) m onth terms (each a "Renewal Term") unless and until either party provides the other party with written notice of termi nation.. the cost of obtaining an opinion of cou nsel in to a notice of potential infringement of the righ ts of any other person or organizat ion). "Losses") In connection with a cl aim. copyrights. pa tents.y buyer :it any time dur i-ri th e during the 1nitial Tf'-..1. moral rights. The Publisher hereby represents. 8.2. r ·. action. its affiliated companies. prior to . recoveries and deficiencies . warranties or cov enants set forth in t his Agreement.e t he Website that Publisher is prepare d to accept. Each Party and its successors and assigns sha!I indemnify. brought or commenced by a t hird pa rty other than an affil iated company of the indemnified Party (each. defend.of this Ag rr-.--. and (v) Publisher has a ll necessary rights and authority to enter into th is Agreement and place advertising. and cond it ions.. Te rm & Renewal 7.-.-: and conditions as Publisr"r is prepa red to arrcpt fro m a third 110r.1. CONFIDENTl/\L . warra nts and coven ants t hat : (i) all of the information provided by Publisher to enter into t his Agreement is correct and current . and their successors and assigns from and against any an d all : deman ds. with or with out cau se..1 . including.i$C 'r<> ri gh t off ·-. prior to the expiration of the Initial Term .or a Renewal Tc ··.3. Unless pre viously t erm inated by notice as provided above. with or without cause. or any other th ird-party right. Right of Fir.-.. and Agent shal l have th irt y (30) days zi fter receipt th ereof to not ify Publ'shcr t h at Agent elects to cx --. including without lim itation interest . or provision of this Agreem ent and su ch breach is not cured within ten ( 10) days after Publisher gives Agent notice of such breach .ilmr. 7 . 7 .. 9..t Re f u sa l 8.1.1<. or (ii) Agent is in materi al breach of any term. rights of publicity. Representations. which arise. Term : This Agreement shall remai n in effect for a p eriod of one (1) year from the date hereof (the "Initial Term") . Publ:-..PROPl:R 7. obligations. liabilities. expenses (including. (iii } use of the Web site by Agent or any of Agent's Advertisers will not infringe upon any third party intellectual property righ ts. Indemnification 10. judgments. damages. reasonable attorneys' fees and costs (collectively. tha t any such party may incur or suffer.. Either party may terminate th is Agreement by providing the other party with sixty (60) days written notice. or relate to the breach by the indem nifying Party of any of its representations. resu lt from.. music performance or o t her music-related rights. Term ination by Agent: Agen t may terminate th is Agreement by written notice to Publisher if any of the follow even ts occur : (i) Publisher is in material breach of any term. Warranties and Covenants 9. and authorize the placement of ad vertising on the Website. United States or foreign trademarks.refusal and the on st:rh t.m ent . Termi nation by Publisher: Publisher may terminate this Agreement by written notice to Agent if any of the follow events occur: (i) Agent fai ls to pay any amount due to Publisher within ten ( 10) days after Publisher gives Agent w ritte n notice of such nonpayment.

Fa ilure by eith er Party to en force an y provis ion of thi s Agreemen t shall be effective only if in writing and signed by both Parties. Gener al 12 .2.''"t'cs . Bindin g Effect . 12 . 1. and the rem ainder of t his Agreemen t Sha. am endment or other modification of any provision of t his Agreement shall be effective only if in writing and sign ed by the Parties. illegal or unen forceable provision sh all be severed from the rem ainder of t his Agreement. such invalid ...ile. s. STATUTORY. st ock or bu siness. OR OTHERWISE INCLUDI NG WITHOUT LIMITATION THE IMPLIED WARRANTIES OF MERCHANTABI LITY.3.4.m cnt inures to t he ber. . 12.. illegal or unenforcea ble. transfer of substantially all o f th e transferrin g part y's assets. Ent ire Agreement: This is th e en tire agreem ent of the parties relati ng to t his subject and it supersedes all o t her com m itm ents. FITNESS FOR A PARTICULAR PU RPOSE.:i' c of Califr --' :i . 12 . ncquisit1 on. Severability: If an y provision of t his Agree ment is held by fin al j udgm ent o f a court of compe ten t jurisdiction to be invalid. AGENT MAKES NO WARRANTY OF AN Y KIND WITH RESPECT TO THE SERVICES PROVIDED UNDER THI S AGREEMENT. -s in int.11.II be en force d unless the severance o f the unen forceable pro vision re nders th e agreem ent commercially unreasonable for eith er party . n egotiat ions and understandings . 12. Any waiver. IMPLIED.. Choice of La w : This is governed by t .. AGENT JS NOT AND SH ALL NOT BE LIABLE FOR THE CONTENT OF THE ADVERTI SI NG SUPPLI ED BY ADVERTISERS. including the Website. This a --n. No Liability. AND NONINFRI NGEMENT. Liability 11. th eir respect ive succe. 12.::rest anc t'" e1r assigns by way of m l"'-'i''!r. Waiver: Failure by either Party to en fo rce an y provision of t his Agreement shall not b e deemed a waiv er of futu re enforcement o f that or any other provision. l.5. c lav" s of the S'."· of and is binding upon rh e p. WH ETHER EXPRESS. CONFIDE NT IAL .

/ / ur I ( . .. P rin t Name and Title: Date: Sy : Pro r>N Media. I I f. LLC: P rint Na me an d Title: Date: I ..-· • . --.. Inc.v-iv.!/ t.. • _(/_ ('.: •I I . By: w-•'- /' • c. "" h-< r _J __ CON FIDEN TIAL .PROPl:R Bardav.

including. imposes no legal liability whatsoever on comScore Inc. l understand that this request is subject to review by comScore Inc.snopes. comScore Inc. whet'ier actual. report ing rul es. for damages. www . will review and honor the req uest m ost recently received. incid ental or consequential. justify ing the aggregation of this traffic. Inc.com Signature Name Title Company Date CO NFIDENTIAL . Inc. Owner of Bardav. certi fy that Bardav is the majority owner of www. changes in ownership of any of those URLs. to determ ine that t he assignmen t of traffic is con sistent with comScore Inc.com and enjoys a legitim ate business relationship with Proper Media. com Score Inc. but not limited to. repo rting r ules . receives mu ltiple reque sts for assig nment of the same URL. if Bardav is not the named registrant of the URLs liste d below. I understand that Bardav is fully responsible for timely notification to comScore Inc. ("Bardav").snopcs. of any upda cs to the list below. ff necessary.. LLC in the comScore Inc. David Mikkelson. LLC elects to include th ese URLs . In requ esting this assignment. Bardav must provide docum entation demonstrating that t he registrant of th ose URLs is (1) owned or ( 2 ) employed by Bardav. LLC. Reporting l. may require additional documentation to verify ownership of the URLs before granting t his request. comScore Inc. relating to the maintenance or reporting of the attached URLs. I understand that Bardav will not rece ive credi t for t raffic to t hese URLs in the syndicated audience reports for those ent it ies where Prope r Media. I understand that acceptance of this letter by comScore Inc. For example. retain s th e rig h t in its sole discreti on to refuse the req uested assignment if such assignment would in fact be inconsisten t with comScore Inc. In the event that comScore Inc. and requ ests assignment of the t raffic to t hese URLs from Bardav to Proper Media. LLC. syndicated audience m easurement reports. These URLs may not be ilSSigned to any other company during the term of t he Agreement between Bardav and Proper Media. Ex hibit A Traffic Assignment Request for comScore.