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CST and IRS: Copyright Terrorists

Using Freedom magazine, one of their many mouthpieces, the Church of Spiritual Technology (CST) actually had the gall a few years ago to accuse some people of being "copyright terrorists" because those people had posted some of CST's copyrighted works to the internet. Then, using their two litigating strong-arms--Religious Technology Center (RTC) and Bridge Publications, Inc. (BPI)--CST launched the longest and bloodiest Reign of Copyright Terror in history, instigating four raids on the homes of private citizens, carting away computers and boxes of files and disks, and filing media-circus lawsuits "defending" their copyrights.

Throughout the ordeal, the three tax lawyers who had been hand-picked by Meade Emory to be the "Special Directors" running CST--Sherman Lenske, Stephen Lenske, and Lawrence E. Heller--were in regular telephone communication with some of the top brass at IRS.

In fact, CST was actually under closely-regulated "probation" with IRS at the time, according to the terms of the then-secret "Closing Agreement." In other words, the Internal Revenue Service was a silent partner to CST's war with the internet over copyrights, and together they hid behind the skirts of Helena Kobrin and Kendrick Moxon (malapropism intended) and the other attorneys that CST had sent out (posing as attorneys only for RTC and BPI) to represent CST's exclusively-owned copyright interests.

In all of that infamous litigation, not one single representative of what laughingly passes for "press" and "media"--including the Washington Post and its reporters who themselves were sued in the Reign of Copyright Terror--ever discovered or reported that CST was the organization that owned the hotly-contested works. Of course no one could have discovered the IRS's slinking involvement, because the "Closing Agreement" was still secret while the bloody War of the Copyrights was being waged. But IRS was there, watching every bit of it approvingly. Not only was IRS staying in "informal" contact with "their people" at CST by telephone, the Assitant Commissioner of IRS was having in-person meetings with CST and the rest of the "Church Tax Compliance Committee" no less frequently than annualy, and possibly arranged meetings by request, as also provided for in the Closing Agreement.

Not only was IRS fully informed from the CST side, though: as some amazing twist of "fate" would have it, one of IRS's very own covert agents, Tom Klemesrud, somehow managed to wind up as a defendant in the very center of the first copyright lawsuit being directed behind the scenes by CST, so IRS had a direct inside line on the War of the Copyrights from the trenches on the "other" side as well. (This may well be only the continuation of a modus operandi: there is well-founded speculation that IRS filed a suit in 1973 as a ruse that resulted in Norton S. Karno's firm, including Sherman and Stephen Lenske, becoming insiders with the Guardian Office and Hubbard's business interests, and that they are the ones who opened the door from the inside for Meade Emory.)

Below is a chronology of some of the incidents in the Reign of Copyright Terror by CST and the IRS. It was they--not RTC, not BPI--who sent their attorney-terrorists out to commit these acts of war on the American people and the courts, using RTC and BPI only as fronts to hide the involvement of CST and IRS. But now, armed with the actual Copyright Office records and the Closing Agreement, we know who was really behind all that follows below:

1 October 1993 The Commissioner of Internal Revenue Service enters into a secret "Closing Agreement" with agents of Church of Spiritual Technology (CST) and other Scientology-related entities and individuals. As part of the secret agreement, CST is granted tax exemption, and simultaneously IRS orders that CST is to receive the entirety of L. Ron Hubbard's estate, contained in the "Author's Family Trust-B," which includes controlling interest in the trademarks, as well as complete ownership of over 7,000 copyrights (later expanded by other transfers to total over 10,000 copyrights.) "Without consideration"--which means CST got it all without paying a dime. That transfer of ownership of Hubbard's estate ("Author's Family Trust B") to CST also included complete ownership of the for-profit corporation "Author Services, Inc." (ASI). SOURCE: Copy of the formerly-secret Closing Agreement published by the Wall Street Journal and other documents linked to on this site.

29 November 1993 Norman F. Starkey transfers all right and title in all Hubbard copyrights (and recently-created derivative "Scientology religion" works as well, over 7,000 in all) to CST as ordered by Commissioner of IRS in the secret IRS Closing Agreement of 1 October 1993. SOURCE: United States Copyright Office records; IRS/Scientology Closing Agreement of 1 October 1993

20 c. August 1994 Dennis Erlich posts portions of CST-owned policies related to "Fair Game" to the newsgroup alt.religion.scientology (a.r.s.). SOURCE: 8 December 1995 Affidavit of Dennis Erlich

22 August 1994 Erlich receives a letter from attorney Thomas Small (purportedly representing RTC, but in fact acting as agent for CST). The letter accuses Erlich of violating "the Church's" copyrights in his postings, and demands that Erlich "remove the offending material from the Internet and agree to refrain from any repetition" of such acts in the future. Erlich replies that his postings made fair use for the purpose of criticism and satire, and challenges "the Church" (RTC) to prove that it held valid copyrights [emphasis added] on the material that he had posted. [NOTE: The copyrights were all owned by CST.] SOURCE: 28 December 1994 Letter from Thomas Small to Dennis Erlich; also Ron Newman's web page, "The Church of Scientology vs. Dennis Erlich, Tom Klemesrud and Netcom"

Christmas Eve, 24 December 1994 An anonymous poster, "nobody@replay.com," posts OT Levels and some of the New Era Dianetics for OTs (NOTs) issues in a.r.s. (Subsequent similar postings of upper-level material in a.r.s, during 1995, become known as "Scamizdat" postings--a term allegedly coined for them by Grady Ward.) NOTE: Copyrights for all the material are owned by CST. SOURCE: 8 December 1995 Affidavit of Dennis Erlich; also "American Lawyer" magazine, March 1996, "Making Law, Making Enemies;" also 2 August 1996 Memorandum in Opposition to Defendant's Motion to Dissolve Preliminary Injunction, RTC v. Grady Ward, UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA, NO.96-20207 RMW.

11 January 1995 Attorney Helena Kobrin, of the firm Small, Larkin & Kidde (agents for CST) attempts unsuccessfully to have the newsgroup alt.religion.scientology removed from usenet. Her message, reproduced below, sets off a firestorm of controversy and adverse publicity, attracting huge numbers of curious and incensed internet users and much media: Control: rmgroup alt.religion.scientology From: hkk@netcom
Subject: cmsg rmgroup alt.religion.scientology
Message-ID: <hkkD29JJB.1GA@netcom.com>
Followup-To: alt.config Organization: NETCOM On-line Communication Services (408 261-4700 guest)
Date: Wed, 11 Jan 1995 22:52:23 GMT

We request that you remove the alt.religion.scientology newsgroup from your site. The reasons for requesting its removal are: (1) It was started with a forged message; (2) not discussed on alt.config; (3) it has the name "scientology" in its title which is a trademark and is misleading, as a.r.s. is mainly used for flamers to attack the Scientology religion; (4) it has been and continues to be heavily abused with copyright and trade secret violations and serves no purpose other than condoning these illegal practices.

Please confirm that you have removed this newsgroup from your system.

Helena K. Kobrin Counsel for trademark and copyright owner [NOTE: Kobrin admits she is representing the copyright owner, but doesn't say who that is. The copyright owner is CST, who, at the time, is under the watchful eye of IRS, is on probation with IRS, and is in regular informal telephone contact with representatives of the Commissioner of IRS.] SOURCE: Copy of the Kobrin message as posted to the internet - 8 February 1995 Attorneys Thomas Small and Helena Kobrin, purporting to represent RTC but actually acting as agents on behalf of CST, go to San Jose, "hundreds of miles away from the site of the controversy," to file a Verified Complaint for Injunctive Relief and Damages against Dennis Erlich, Tom Klemesrud, and Net-Com for copyright infringement and trade secret misappropriation. [NOTE: Tom Klemesrud has since admitted to being a covert agent for IRS; he "just happened" to be the internet go-between delivering Net-Com service to Erlich in this opening salvo of the CST Copyright War on the 'Net which "just happens" to fraudulently promote RTC around the world as the "copyright holder."] SOURCE: 8 February 1995 Verified Complaint for Injunctive Relief and Damages for Copyright Infringement and Trade Secrets Misappropriation, United States District Court Northern District of California, No. C-95-20091-RMW, RTC and BPI v. Net-Com, Ehrlich, and Klemesrud.

13 February 1995 Off-duty Sergeant Ed Eccles of the Inglewood Police Department, along with approximately 25 other people, arrive at the home of Dennis Erlich. Eccles says he has a writ of seizure that allows him to enter Erlich's home, and that if Erlich doesn't open the door, he will carry out the writ by force. After some discussion, six people enter Erlich's home. Apart from Eccles, they include three people identified as officials of the Religious Technology Center (RTC): Warren McShane, attorney Thomas Small, and Paul Wilmhurst, RTC's computer operator. Also present are on-duty Glendale police officer Steve Eggert, off-duty Inglewood police officer Mark Fronterotta, and a private investigator hired by RTC's counsel, Robert Shovlin. For seven hours, they copy and erase files from two computers in Erlich's home, search his home and take numerous items, partially kick in his garage door to attempt a search of the garage, and have his home extensively photographed. [NOTE: All of their actions are being carried out on the orders of the copyright owners, CST, whose tax-attorney Special Directors are in regular touch with senior IRS officials at the time.] SOURCE: 8 December 1995 Affidavit of Dennis Erlich

15 c. July 1995 Arnaldo "Arnie" Lerma is made a director at FACTNet. SOURCE: Corporate records and testimony by Lerma and others.

31 July and 1 August 1995 Arnie Lerma, acting as a director of FACTNet, posts to alt.religion.scientology the entire text of the so-called "Fishman Affidavit," including all of the OT Levels. The copyrights for all the materials are owned by CST. SOURCE: 28 November 1995 Memorandum Opinion in Civil Action No. 95-1107-A, United States District Court for the Eastern District of Virginia, RELIGIOUS TECHNOLOGY CENTER V. ARNALDO PAGLIARINI LERMA, DIGITAL GATEWAY SYSTEMS, THE WASHINGTON POST, MARC FISHER, and RICHARD LEIBY

4 August 1995 Attorney Melvin F. Jager, representing "RTC" (themselves agents of CST), sends a FAX to Arnie Lerma threatening legal action if Lerma does not take immediate action to remove from the Internet the material Lerma had posted. SOURCE: Copy of the FAX as posted on the internet

5 or 6 August 1995 Arnie Lerma sends a hard copy of "the Fishman Affidavit" and the CST-owned OT Levels to Washington Post reporter Richard Leiby. [NOTE: Throughout all of the ensuing events, including a law suit filed against them, the Washington Post and Leiby were too ignorant to ever discover that the owner of the disputed copyrights was CST, or, worse, they did know and intentionally withheld the information from the public. They exclusively reported about RTC.] SOURCE: 28 November 1995 Memorandum Opinion in Civil Action No. 95-1107-A, United States District Court for the Eastern District of Virginia, RELIGIOUS TECHNOLOGY CENTER V. ARNALDO PAGLIARINI LERMA, DIGITAL GATEWAY SYSTEMS, THE WASHINGTON POST, MARC FISHER, and RICHARD LEIBY; ARS Week In Review 6 Aug 1995

11 August 1995 Attorneys for RTC, acting as agents for CST, file a lawsuit against Arnaldo Pagliarini "Arnie" Lerma and against his internet provider, Digital Gateway Systems. SOURCE: 22 August 1995 Press Release from Leisa Goodman and Earle Cooley.

12 August 1995 At 9:30 a.m., attorney Earl C. Cooley, attorney Helena Kobrin, President of RTC Warren McShane, and others (all agents for CST), accompanied by two federal marshalls and a writ of seizure, raid Arnie Lerma's home, seizing computers, computer files and disks, and other items. "RTC" representatives (actually agents on behalf of CST) also show up at the home of Washington Post reporter Richard Leiby wanting Leiby to return to them the documents that Lerma had sent to Leiby. The materials are returned to RTC--but at the same time, the Post is already setting into motion a way to get the same documents from the California court where the Fishman case is pending. SOURCE: 28 November 1995 Memorandum Opinion in Civil Action No. 95-1107-A, United States District Court for the Eastern District of Virginia, RELIGIOUS TECHNOLOGY CENTER V. ARNALDO PAGLIARINI LERMA, DIGITAL GATEWAY SYSTEMS, THE WASHINGTON POST, MARC FISHER, and RICHARD LEIBY; numerous public accounts of the raid.

15 August 1995 Larry Wollersheim issues a public statement on the Lerma raid: "The full Board of Directors of FACTNet stands behind its fellow Board member, Arnie Lerma, who acted in accordance with our organizational purposes in distributing the legally obtained court record called the Fishman affidavit. ...FACTNet's full financial, insurance, informational and human resources will be used to defend Arnie Lerma." Wollersheim goes on to urge that others "immediately begin putting up 100-1000 times more Fishman affidavit type public records on Scientology into world wide distribution on the Internet." SOURCE: 15 August 1995 "FACTNET'S statement on SCIENTOLOGY'S RAID ON FACTNET DIRECTOR ARNIE LERMA," by Larry Wollersheim, posted to the internet by Bob Penny

19 August 1995 The Washington Post publishes an article, "Church in Cyberspace: Its Sacred Writ is on the Net. Its Lawyers are on the Case," written by Marc Fisher. Much is made of "RTC's" lawsuit against Lerma and the seizure of his computer equipment, as well as the history of Scientology litigation against its critics and the growing use of the internet by Scientology dissidents. The article includes three brief quotes (46 words) from three of the CST-owned OT Levels. [NOTE: The article could have been named "Washington Post Lost in Space," since the the Post never, ever found out--even when the Post was later sued by "RTC" for this very article--that the "Sacred Writ" belonged entirely to CST, which was secretly being micromanaged at the time by IRS. Apparently they still haven't found out to this day, seven years later. Somebody ought to FAX them. Or send them a press release, maybe.] SOURCE: 28 November 1995 Memorandum Opinion in Civil Action No. 95-1107-A, United States District Court for the Eastern District of Virginia, RELIGIOUS TECHNOLOGY CENTER V. ARNALDO PAGLIARINI LERMA, DIGITAL GATEWAY SYSTEMS, THE WASHINGTON POST, MARC FISHER, and RICHARD LEIBY

21 August 1995 In response to Larry Wollersheim's official corporate endorsement and support of Arnie Lerma's actions as a FACTNet director, "attorneys for RTC" (though all their actions are carried out as agents for copyright owners CST) file a verified complaint against Lawrence Wollersheim, Robert Penny and FACTNet, Inc. for injunctive relief and damages for copyright infringement [emphasis added] and trade secrets misappropriation. SOURCE: 15 September 1995 Order denying RTC motion for prelinary injunction in RTC v. Wollersheim, et al., Civ. A. No. 95-B-2143. United States District Court, District of Colorado.

22 August 1995 "RTC" (licensee and agent for CST) files its First Amended Verified Complaint in its lawsuit against Lerma and his internet provider. The amended complaint adds the Washington Post and its two reporters, Marc Fisher and Richard Leiby, as additional defendants, also for copyright infringement. [NOTE: Has anybody sent a memo to Leiby and the Post yet about CST owning the copyrights? Or are they still asleep at the copy desk? Ah, don't wake them.] SOURCE: 28 November 1995 Memorandum Opinion in Civil Action No. 95-1107-A, United States District Court for the Eastern District of Virginia, RELIGIOUS TECHNOLOGY CENTER V. ARNALDO PAGLIARINI LERMA, DIGITAL GATEWAY SYSTEMS, THE WASHINGTON POST, MARC FISHER, and RICHARD LEIBY

22 August 1995 "Attorneys for RTC" (agents for copyright-owners CST) obtain yet another writ of seizure, this time from a Colorado judge, and raid FACTNet--the homes of Larry Wollersheim and FACTNet Vice President Robert Penny--seizing all computers and computer files plus other material. SOURCE: Numerous legal documents, news media accounts, and internet postings regarding the event, on file; 22 August 1995 Press Release from Karen Pouw and Gail Armstrong.

12 November 1995 In an almost amazing display of chutzpah, Sherman Lenske--CST Special Director, architect with Meade Emory of the entire corporate and copyright fraud being perpetrated--actually submits a Declaration in the copyright infringement suit against Arnaldo Lerman, against Washington Post reporters Richard Leiby and Marc Fisher, against the Washington Post itself, et al., in which Lenske rambles on for pages and pages without ever once mentioning that his own corporation, CST--which he and his brother and law partner utterly control--is the owner of the copyrights that the Post and Lerma are being sued over. And neither the judge, Leoni Brinkema, nor Lerma, nor the Post, nor any of their counsel, ever find out what Lenske has done to them. Lenske even has the gall to tell them flat out--not once, but twice--in his Declaration, that the rights RTC got to the Advance Technology were exclusive of copyrights! Of course he didn't bother to tell them who did own the copyrights they were being sued over. Why should he? Nobody bothered to ask.

- While this chronology could go on to document the many twists and turns of litigation and public posturings that ensued, suffice it to say that even some of the courts involved were duped, or somehow swayed, into falsely reporting that RTC owned some of the contested copyrights. As noted in this chronology, the Washington Post, to its eternal shame, never even found out who was really suing them, even though the suit against them was tossed out. It's as though CST and IRS set out to put one over on the Post, and did. Partially because of the Post's negligence and grand failure at anything resembling investigative reporting, CST has continued to enjoy relative obscurity, utilizing its strong-arm licensees, RTC and BPI, to keep harrassing and threatening anyone who dares to quote their copyrighted materials. This site fully documents who was, and is, really behind the Reign of Copyright Terror. It is the 501(c)(3) corporation known as "Church" of Spiritual Technology, doing business as the "L. Ron Hubbard Library."

EPILOGUE: Freedom magazine has expunged from its internet archives all reference to "copyright terrorists." They have rewritten their internet archival version of their original issue on the topic to whitewash that out. This was discovered by comparing a hardcopy of that issue to what is on the net now. So much for journalistic integrity for Freedom magazine and for what must be their sister publication, the Washington Post.-

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