Evidence Record

Declaration of Charles Watts in Support of Defendants Cyberlux Corporation’s Ex Parte Application to Quash and Recall Plaintiffs’ Request and Application for Writ of Execution

1. I am the special counsel for Defendant Cyberlux Corporation ("Cyberlux"). I am an attorney licensed to practice and in good standing in North Carolina and am located in North Carolina. If called as...

Type
declaration
Court
SDCAL
Case
Atlantic Wave / Cyberlux litigation
Pages
4
Lines
250
SHA-256
0ac0650e4194

DISTIL analysis

DISTIL Run
Profile
Standard
Version
1
Doc Type
court_declaration
Total Nodes
26
Node Legend
Entity (ENT)
Event (EVT)
Claim (CLM)
Anchor (ANC)
Omission (OMI)
Tension (TEN)
Tell (TEL)
Inference (INF)
Hypothesis (HYP)
Stage 1
Index
Orientation · No nodes
Document Classification
court_declaration defense_counsel federal_civil_litigation 2024-05-31 to 2024-06-14
payment_disputewrit_executionaccount_sequestrationcircular_enforcement
Analytical Frame
settlement_payment_dispute
Analytical Summary
Charles Watts, special counsel for Cyberlux Corporation, declares that Cyberlux was current on settlement payments to Atlantic Wave Holdings and Secure Community as of May 31, 2024. During the week of May 31, 2024, plaintiffs obtained a Writ of Fieri Facias in Virginia State Court that sequestered Cyberlux's bank accounts, preventing access to funds earmarked for the June 2024 payment. On June 9, 2024, Cyberlux requested plaintiffs release the sequestered funds to enable the June payment, but plaintiffs refused. Watts asserts plaintiffs then characterized Cyberlux as having "missed" the June payment despite plaintiffs' own sequestration action preventing payment. This creates a temporal paradox where enforcement action blocks compliance, then non-compliance justifies further enforcement.
Key Points
  • Cyberlux was current on all settlement payments as of May 31, 2024
  • Plaintiffs obtained Virginia state court writ sequestering Cyberlux bank accounts around May 31, 2024
  • Sequestration prevented Cyberlux access to funds set aside for June 2024 payment
  • Cyberlux requested release of sequestered funds on June 9, 2024; plaintiffs refused
  • Plaintiffs characterized Cyberlux as having missed June payment after blocking access to payment funds
  • Declaration supports ex parte application to quash writ of execution
Stage 2
Core — Entities, Events, Claims
13 nodes
ENT-001
Entity
Charles Watts
Charles Watts, special counsel for Defendant Cyberlux Corporation, attorney licensed in North Carolina
Page 2 — I, Charles Watts, declare: 1. I am the special counsel for Defendant Cyberlux Corporation ("Cyberlux"). I am an attorney licensed to practice and in good standing in North Carolina and am located in North Carolina.
ENT-002
Entity
Cyberlux Corporation
Cyberlux Corporation, Nevada corporation, defendant in settlement payment dispute
Page 1 — CYBERLUX CORPORATION, a Nevada Corporation; Defendant.
ENT-003
Entity
Atlantic Wave Holdings, LLC
Atlantic Wave Holdings, LLC, Virginia limited liability company, plaintiff in settlement enforcement action
Page 1 — ATLANTIC WAVE HOLDINGS, LLC, a Virginia limited liability company; and SECURE COMMUNITY, LLC, a Virginia limited Liability company, Plaintiffs,
ENT-004
Entity
Secure Community, LLC
Secure Community, LLC, Virginia limited liability company, co-plaintiff in settlement enforcement action
Page 1 — ATLANTIC WAVE HOLDINGS, LLC, a Virginia limited liability company; and SECURE COMMUNITY, LLC, a Virginia limited Liability company, Plaintiffs,
ENT-005
Entity
Settlement Agreement
Settlement Agreement between Cyberlux and plaintiffs governing payment of amounts in Stipulated Judgment
Page 2 — I have been personally involved in Cyberlux's making of payments to Atlantic Wave Holdings, LLC and Secure Community, LLC (collectively, "Plaintiffs") pursuant to the terms of the Settlement Agreement between the parties for payment of the amounts reflected in the Stipulated Judgment between the parties.
EVT-001
Event
Payment compliance as of May 31, 2024
As of May 31, 2024, Cyberlux was current on all required payments to plaintiffs under settlement agreement
Page 2 — As of May 31, 2024, Cyberlux was up to date on all payments to Plaintiffs.
EVT-002
Event
Writ of Fieri Facias obtained
On or about the week of May 31, 2024, plaintiffs obtained a Writ of Fieri Facias in Virginia State Court
Page 2 — On or about the week of May 31, 2024, Plaintiffs obtained a Writ of Fieri Facias in Virginia State Court.
EVT-003
Event
Bank account sequestration
As result of Writ of Fieri Facias, Cyberlux's bank accounts were sequestered, blocking access to funds set aside for June 2024 payment
Page 2 — As a result of this Writ of Fieri Facias, Cyberlux's bank accounts were sequestered, preventing Cyberlux from gaining access to the money it had set aside for the June 2024 payment to Plaintiffs pursuant to the Settlement Agreement.
EVT-004
Event
Request to release funds - June 9, 2024
On or about June 9, 2024, Cyberlux requested plaintiffs agree to release sequestered funds to enable June payment
Page 2 — On or about June 9, 2024, Cyberlux requested that Plaintiffs agree to the release of those funds so that Cyberlux could make its June payment to Plaintiffs.
EVT-005
Event
Plaintiffs refuse release request
Plaintiffs refused Cyberlux's request to release sequestered funds
Page 2 — Plaintiffs refused Cyberlux's request.
CLM-001
Claim
Payment compliance claim
Cyberlux claims it was current on all settlement payments as of May 31, 2024
Page 2 — As of May 31, 2024, Cyberlux was up to date on all payments to Plaintiffs.
CLM-002
Claim
Funds earmarked for payment
Cyberlux claims it had set aside money specifically for the June 2024 payment before accounts were sequestered
Page 2 — preventing Cyberlux from gaining access to the money it had set aside for the June 2024 payment to Plaintiffs pursuant to the Settlement Agreement.
CLM-003
Claim
Plaintiffs' missed payment characterization
Plaintiffs characterized Cyberlux as having "missed" June payment after plaintiffs themselves sequestered the payment funds
Page 2 — Plaintiffs have since used their own refusal to release the funds that they had sequestered to take the position that Cyberlux has "missed" its June payment.
Stage 3
In Situ — Quotations, Tells, Tensions, Questions
7 nodes
TEN-001
Tension
Circular enforcement paradox
Plaintiffs obtain writ sequestering defendant's accounts, preventing payment, refuse to release funds when requested, then claim defendant missed payment
Page 2 — As a result of this Writ of Fieri Facias, Cyberlux's bank accounts were sequestered, preventing Cyberlux from gaining access to the money it had set aside for the June 2024 payment to Plaintiffs pursuant to the Settlement Agreement... Plaintiffs refused Cyberlux's request... Plaintiffs have since used their own refusal to release the funds that they had sequestered to take the position that Cyberlux has "missed" its June payment.
TEN-002
Tension
Dual enforcement mechanisms
Plaintiffs pursued Virginia state court writ while federal court settlement agreement was in effect and being performed
Page 2 — On or about the week of May 31, 2024, Plaintiffs obtained a Writ of Fieri Facias in Virginia State Court... As of May 31, 2024, Cyberlux was up to date on all payments to Plaintiffs.
QUO-001
Quotation
Missed payment characterization
Plaintiffs characterized payment as "missed" despite sequestration
Page 2 — Plaintiffs have since used their own refusal to release the funds that they had sequestered to take the position that Cyberlux has "missed" its June payment.
QST-001
Question
Settlement agreement payment schedule
What is the payment schedule and payment amount structure under the Settlement Agreement?
Page 2 — pursuant to the terms of the Settlement Agreement between the parties for payment of the amounts reflected in the Stipulated Judgment between the parties
QST-002
Question
Virginia writ basis
On what basis did plaintiffs obtain Virginia state court Writ of Fieri Facias while defendant claims to be current on federal settlement payments?
Page 2 — As of May 31, 2024, Cyberlux was up to date on all payments to Plaintiffs... On or about the week of May 31, 2024, Plaintiffs obtained a Writ of Fieri Facias in Virginia State Court.
QST-003
Question
Nature of fund release request
Was the June 9 request for fund release formal or informal, and what legal mechanism was invoked?
Page 2 — On or about June 9, 2024, Cyberlux requested that Plaintiffs agree to the release of those funds so that Cyberlux could make its June payment to Plaintiffs.
QST-004
Question
Amount in sequestered accounts
What amount was in the sequestered accounts and how does it compare to the June payment obligation?
Page 2 — preventing Cyberlux from gaining access to the money it had set aside for the June 2024 payment to Plaintiffs pursuant to the Settlement Agreement
Stage 4
Interpretive — Inferences, Omissions, Patterns
6 nodes
INF-001
Inference
Strategic enforcement timing
Timing of writ issuance around payment due date suggests deliberate strategy to create default condition while defendant was current on payments
Page 2 — On or about the week of May 31, 2024, Plaintiffs obtained a Writ of Fieri Facias in Virginia State Court... preventing Cyberlux from gaining access to the money it had set aside for the June 2024 payment
INF-002
Inference
Manufactured default theory
Declarant implies plaintiffs manufactured a default condition by blocking access to payment funds then refusing to cure the blockage they created
Page 2 — Plaintiffs have since used their own refusal to release the funds that they had sequestered to take the position that Cyberlux has "missed" its June payment.
INF-003
Inference
Earmarked funds claim supports preparation
Specific reference to funds "set aside" for June payment suggests advance planning and segregation of payment funds, supporting compliance intent claim
Page 2 — preventing Cyberlux from gaining access to the money it had set aside for the June 2024 payment to Plaintiffs pursuant to the Settlement Agreement
OMI-001
Omission
Prior payment history details
No detail provided on payment amounts, dates, or duration of prior compliance beyond May 31 cutoff
Page 2 — As of May 31, 2024, Cyberlux was up to date on all payments to Plaintiffs.
OMI-002
Omission
Plaintiffs' stated basis for writ
Declaration does not include plaintiffs' stated legal basis or justification for obtaining Virginia writ
Page 2 — On or about the week of May 31, 2024, Plaintiffs obtained a Writ of Fieri Facias in Virginia State Court.
OMI-003
Omission
Reason for refusal to release funds
No explanation provided for why plaintiffs refused to release sequestered funds when requested
Page 2 — Plaintiffs refused Cyberlux's request.

Extracted text

4 pages · 5446 characters

Declaration of Charles Watts in Support of Defendants Cyberlux Corporation's Ex Parte Application to Quash and Recall Plaintiffs' Request and Application for Writ of Execution — Formatted Extract

Type: declaration
Court: SDCAL
Matter: Atlantic Wave / Cyberlux litigation
Filing Header

HAHN LOESER & PARKS LLP Gabe P. Wright (SBN 208647) One America Plaza 600 W. Broadway, Suite 1500 San Diego, CA 92101 Telephone: 619.810.4300 Facsimile: 619.810.4301

gwright@hahnlaw.com

THOMPSON COBURN LLP JEFFREY N. BROWN, CSB 105520 jbrown@thompsoncoburn.com 10100 Santa Monica Blvd., Suite 500 Los Angeles, California 90067 Tel: 310.282.2500 / Fax: 310.282.2501

EDWARD W. GRAY, JR. (SBN 80966) egray@thompsoncoburn.com 1909 K Street, NW Suite 600 Washington, D.C. 20006 Tel: 202.585.6967 / Fax: 202.585.6969

ALLEN CHESSON & GRIMES DOUGLAS GRIMES (pro hac vice application pending) dgrimes@allenchesson.com 505 N. Church Street Charlotte, NC 28202 Tel: 704.755.6012

Attorneys for Defendant CYBERLUX CORPORATION

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF CALIFORNIA

ATLANTIC WAVE HOLDINGS, LLC, a Virginia limited liability company; and SECURE COMMUNITY, LLC, a Virginia limited Liability company,

Plaintiffs, V.

CYBERLUX CORPORATION, Nevada Corporation;

a

Defendant.

Case No. 3:24-cv-00482-RBM-VET

Declaration

DECLARATION OF CHARLES WATTS IN SUPPORT OF DEFENDANTS CYBERLUX CORPORATION'S EX PARTE APPLICATION TO QUASH AND RECALL PLAINTIFFS' REQUEST AND APPLICATION FOR WRIT OF EXECUTION

Dist. Judge: Ruth Bermudez Montenegro

3:24-cv-00482-RBM-VET

I, Charles Watts, declare:

1.
I am the special counsel for Defendant Cyberlux Corporation ("Cyberlux"). I am an attorney licensed to practice and in good standing in North Carolina and am located in North Carolina. If called as a witness, I would competently testify as to the following facts based on my personal knowledge.
2.
I have been personally involved in Cyberlux's making of payments to Atlantic Wave Holdings, LLC and Secure Community, LLC (collectively, "Plaintiffs") pursuant to the terms of the Settlement Agreement between the parties for payment of the amounts reflected in the Stipulated Judgment between the parties.
3.
As of May 31, 2024, Cyberlux was up to date on all payments to Plaintiffs.
4.
On or about the week of May 31, 2024, Plaintiffs obtained a Writ of Fieri Facias in Virginia State Court. As a result of this Writ of Fieri Facias, Cyberlux's bank accounts were sequestered, preventing Cyberlux from gaining access to the money it had set aside for the June 2024 payment to Plaintiffs pursuant to the Settlement Agreement.
5.
On or about June 9, 2024, Cyberlux requested that Plaintiffs agree to the release of those funds so that Cyberlux could make its June payment to Plaintiffs. Plaintiffs refused Cyberlux's request.
6.
Plaintiffs have since used their own refusal to release the funds that they had sequestered to take the position that Cyberlux has "missed" its June payment. I declare under penalty of perjury that the foregoing is true and correct.

Executed this 14th day of June, 2024, at Charlotte, North Carolina.

Amy & Wat

Charles Watts

PROOF OF SERVICE [FRCP 5(B)]

STATE OF CALIFORNIA, COUNTY OF SAN DIEGO

I am employed in the County of San Diego, State of California. I am over the age of 18 years and am not a party to the within action; my business address is 600 W. Broadway, Suite 1500, San Diego, CA 92101. My electronic service address is mkanamori@hahnlaw.com.

On June 14, 2024, I served the following document(s) described as:

DECLARATION OF CHARLES WATTS IN SUPPORT OF DEFENDANTS CYBERLUX CORPORATION'S EX PARTE APPLICATION TO QUASH AND RECALL PLAINTIFFS' REQUEST AND APPLICATION FOR WRIT OF EXECUTION

on the interested parties in this action as follows: :selected: BY ELECTRONIC MAIL: A copy of the foregoing document was electronically filed using the CM/ECF system which will send a notice of electronic filing to all CM/ECF participants listed below:

David M. Keithly, SBN 292101 Sara Ross, SBN 346153 Mortenson Taggart Adams LLP 300 Spectrum Center Drive, Ste. 1200 Irvine, CA 92618 Email: dkeithly@mortensontaggart.com sross@mortensontaggart.com

Attorneys for Plaintiffs Atlantic Wave Holdings, LLC Secure Community, LLC

:selected: BY ELECTRONIC MAIL: I caused the documents to be transmitted by electronic mail to the party(s) identified on the below service list using the e-mail address(es) shown. I did not receive, within a reasonable time after transmission, any electronic message or other indication that the transmission(s) were unsuccessful.

James K. Sadigh, SBN 140199 9777 Wilshire Blvd., Suite 400 Beverly Hills, CA 90212 Email: jamessadigh@aol.com Attorneys for Plaintiffs Atlantic Wave Holdings, LLC Secure Community, LLC

I declare that I am employed in the office of a member of the bar of the court at whose direction the service was made.

Executed on June 14, 2024, at San Diego, California.

melisu

Melissa P. Kanamori

Original source file

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File
aw-awh-sdcal-00482-doc-018-exhibit-2.pdf
Source UID
source:0ac0650e4194bd79422b948a8716962ef36991d5764a29547a285ac0003d59e9
Full SHA-256
0ac0650e4194bd79422b948a8716962ef36991d5764a29547a285ac0003d59e9