IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS. v. CIVIL ACTION NO. 10-CV-04489
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1 IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS IMPERIAL ED PROMOTIONS, LLC, Plaintiff, v. CIVIL ACTION NO. 10-CV EMMANUEL PACQUIAO, Defendant. AND APPLICATION FOR INJUNCTIVE RELIEF TO THE HONORABLE JUDGE OF SAID COURT: COMES NOW, PLAINTIFF, IMPERIAL ED PROMOTIONS, LLC, and files this its Plaintiff s Original Complaint, and for cause of action and as grounds therefore would respectfully show unto the Court as follows: PARTIES 1. Plaintiff, IMPERIAL ED PROMOTIONS, LLC ( Imperial ), is a limited liability company organized under the laws of the State of Texas. The members of the limited liability company are citizens of the State of Texas: Edmundo H. Lozano, Manager, 3824 South D Street, McAllen, Texas 78503; and Pablo Casas, Manager, 814 South Oklahoma, Weslaco, Texas Defendant, EMMANUEL PACQUIAO ( Pacquiao ), also known as Emmanuel Dapidran Pacquiao or Manny Pacman Pacquiao, is an individual located in the State of California, and a citizen of foreign nationality, specifically, of the Philippines, herein sued in his capacity as a professional boxer while doing business in the State of Texas. Page 1 of 18
2 3. Defendant Pacquiao may be served with process at 1123 Vine Street, Hollywood, California 90038, or at 526 North Plymouth Boulevard, Los Angeles, California , or at the Gaylord Texan Hotel and Convention Center, 1501 Gaylord Trail, Grapevine, Texas 76051, or wherever he may be found, or by serving the Texas Secretary of State, 1019 Brazos Street, Austin, Texas 78701, as Defendant s agent for service because Defendant a. engaged in business in Texas but has not designated or maintained a resident agent for service of process in Texas; b. engaged in business in Texas but does not maintain a regular place of business in Texas or a designated agent for service of process, and this suit arose from Defendant s business in Texas; c. committed a tort in whole or in part in Texas. TEX. CIV. PRAC. & REM. CODE (2), (a)(1), (b), JURISDICTION 4. The Court has jurisdiction over the lawsuit under 28 U.S.C. 1332, founded on diversity of citizenship, and the amount in controversy exceeds $75,000, excluding interest and costs. VENUE 5. Venue is mandatory and proper in this district under 28 U.S.C because a substantial part of the events or omissions giving rise to the claim occurred in this district. CONDITIONS PRECEDENT 6. All conditions precedent have been performed or have occurred as required. STATEMENT OF FACTS 7. On or around July 28, 2010, the parties entered into a written contract, signed by and between Edmundo H. Lozano of IMPERIAL ED PROMOTIONS, LLC ( Imperial ) and Page 2 of 18
3 EMMANUEL PACQUIAO ( Pacquiao ), and witnessed thereof by Bebra Pérez and María Lourdes Guillen (the Agreement ). Pacquiao was paid one hundred thousand dollars ($100, USD) by Imperial to make a special appearance, and failed to appear and to return the money in breach of contract. A true and correct copy of the Agreement is attached as Exhibit 1 and incorporated herein for all purposes. 8. Ignacio Pérez facilitated the Agreement between the parties. The parties made various modifications to the contract before the signing of the final Agreement. 9. On or around July 16, 2010, at Bebra Pérez s request, Imperial paid for an airplane ticket in the amount of $1, to María Lourdes Guillen, so that she could personally deliver the written contract to Pacquiao in General Santos City, Philippines. 10. On or around July 21, 2010, Edmundo H. Lozano, representing Imperial, signed the Agreement, witnessed by Bebra Pérez, in McAllen, Texas. 11. On or around July 28, 2010, Pacquiao signed the Agreement in General Santos City, Philippines, witnessed by María Lourdes Guillen. The scanned contract was sent to Imperial via electronic mail and bears the signatures of both parties, Imperial and Pacquiao. 12. Imperial accepted the scanned contract in good faith and requested that an original copy be sent as soon as possible. 13. Pursuant to the terms of the Agreement, Pacquiao agreed to appear and participate in a series of events promoted by Imperial, from September 17, 2010 through September 19, The scheduled events included a number of social functions and promotional opportunities in the city of McAllen, Texas, and the surrounding area, leading to a series of boxing matches held in the city of Hidalgo, Texas. Page 3 of 18
4 15. The events were scheduled to coincide with the Bicentennial of the Mexican War of Independence (1810) and the Centennial of the Mexican Revolution (1910). 16. In the event of Pacquiao s cancellation, under paragraph 9 of the Agreement, Pacquiao must return to Imperial any payments made by Imperial, unless Pacquiao reschedules to appear at another event hosted by Imperial, before the end of the calendar year Under the contract, Pacquiao was required to enter into a rescheduling agreement, in writing, by September 18, If such an agreement is not entered into by this date, then Pacquiao must reimburse Imperial no later than by September 25, No rescheduling agreement was offered or entered into by Pacquiao. After Pacquiao s breach of contract, Pacquiao failed to reimburse Imperial s payment of one hundred thousand dollars ($100, USD). 19. On or around August 5, 2010, Pacquiao s team provided a bank account to Imperial for the first agreed payment. The name of Jinkee Pacquiao, Pacquiao s wife, appeared on the account. 20. On or around August 9, 2010, a second bank account number was provided, with the name of Emmanuel Pacquiao on the account. The account was in the Philippines. Imperial agreed to wire payment to this account. 21. On or around August 12, 2010, Imperial wire transferred the first payment of one hundred thousand dollars ($100, USD) to Pacquiao s account, per the Agreement (the Wire Transfer ). A true and correct copy of the Wire Transfer is attached as Exhibit 2 and incorporated herein for all purposes. 22. Imperial promoted and advertised the upcoming events, and managed and coordinated all aspects of the scheduled events. Pacquiao s representatives were notified of all major Page 4 of 18
5 activities planned, as well as all promotional materials to be used, in accordance with the contract. 23. In mid-august, 2010, the boxing circle announced the Manny Pacquiao versus Antonio Margarito fight, scheduled to take place on November 13, 2010 at the Dallas Cowboys Stadium in Arlington, Texas. 24. On September 3, 2010, after appearing at a preseason NFL football game between the Dallas Cowboys and Miami Dolphins in Arlington, Texas, Pacquiao and Margarito held the Pacquiao vs. Margarito Dallas Texas Press Conference. 25. During the Dallas, Texas, press conference, members of Imperial s team spoke with members of Pacquiao s team. 26. Edmundo H. Lozano ( Lozano ), the President of Imperial ED Promotions, LLC, approached Pacquiao with a poster in his hand. The poster was part of Imperial s promotional materials and clearly depicted the September event, hosted by Imperial in McAllen, Texas, and the surrounding area ( Rio Grande Valley ). 27. Lozano personally told Pacquiao that the Imperial team and company were there at the Dallas, Texas, press conference, and that they were the promotions team for the events that Pacquiao agreed to attend in two more weeks. 28. Pacquiao indicated that he did not know if he was to attend any of the events. Pacquiao signed the poster. When Lozano tried to talk to Pacquiao again about his attendance at the September events, the bodyguards refused to allow the members of the Imperial team near Pacquiao. Page 5 of 18
6 29. Freddie Roach, Pacquiao s trainer, directly told another member of the Imperial team, Salvador Avilez, that Pacquiao would not appear at the September events scheduled in the Rio Grande Valley. 30. Specifically, Freddie Roach confirmed that it would not be possible for Pacquiao to appear, as it would conflict with his training for the Margarito fight. 31. On September 3, 2010, Imperial postponed the second payment, upon reasonable anticipation of Pacquiao s breach of contract. While in Dallas, Texas, Pacquiao s team confirmed that Pacquiao would not appear as he had agreed. 32. On or around September 10 through September 11, 2010, Michael Koncz ( Koncz ) identified himself to Imperial as the chief advisor to Pacquiao and an agent of Pacquiao. Koncz also confirmed Pacquiao s breach of contract, by acknowledging that Pacquiao knew that he would not appear at the September event in the Rio Grande Valley. 33. Koncz acknowledged the contract signed with Imperial, and his knowledge that the Agreement was signed prior to the newly signed commitment in Dallas, Texas. 34. Pacquiao did not return the payments made by Imperial. Pacquiao did not reschedule to appear at another event hosted by Imperial before the end of the calendar year Pacquiao failed to enter into a rescheduling agreement, in writing, by September 18, Pacquiao failed to reimburse Imperial by September 25, On or around October 25, 2010, Imperial, through counsel, made demand upon Pacquiao for payment of the following amount for actual losses incurred and expected profits, calculated to be at least the following amount, as damages caused by reason of Pacquiao s breach of contract, fraudulent acts, and tortious conduct committed against Imperial: $1,180,210. Page 6 of 18
7 37. Pacquiao has not returned the first payment of one hundred thousand dollars ($100, USD) made by Imperial. Pacquiao has not reimbursed Imperial for any costs and expenses incurred as a result of Pacquiao s wrongful acts. 38. Pacquiao and members of his team have participated in and committed the following counts against Imperial: (i) breach of contract, (ii) common-law fraud, (iii) fraud by nondisclosure, (iv) tortious interference with existing contracts, and (v) tortious interference with prospective relations. 39. As a result of Pacquiao s breach of contract, fraudulent acts, and tortious conduct, Imperial suffered damages, as stated herein. 40. The following Exhibits 1 2 are attached hereto and incorporated herein for all purposes: 1. The Agreement, signed by and between Edmundo H. Lozano of IMPERIAL ED PROMOTIONS, LLC ( Imperial ) and EMMANUEL PACQUIAO ( Pacquiao ), and witnessed thereof by Bebra Pérez and María Lourdes Guillen, and facilitated by Ignacio Pérez, entered into on or around July 28, The Wire Transfer, in the amount of one hundred thousand dollars ($100, USD), from Plaintiff IMPERIAL ED PROMOTIONS, LLC ( Imperial ) to Defendant EMMANUEL PACQUIAO ( Pacquiao ), dated August 12, FIRST CAUSE OF ACTION BREACH OF CONTRACT 41. In addition to other counts, Defendant breached his contractual obligations to Plaintiff. 42. On or around July 28, 2010, Plaintiff and Defendant executed a written contract. 43. A true and correct copy of the contract is attached as Exhibit 1 and incorporated herein for all purposes. Page 7 of 18
8 44. Plaintiff has performed its obligations under the contract. 45. Defendant, however, has not performed his contractual obligations. 46. Defendant s nonperformance is a breach of the parties contract. 47. Pacquiao and/or his agents have acknowledged Imperial s costs of promoting and managing the event and the economic burden which resulted from the cancellation of Pacquiao s appearance in the Rio Grande Valley, from September 17, 2010 through September 19, 2010, in relation to the events scheduled by Imperial and hosted by various entities in conjunction with Imperial. 48. Liquidated damages. Defendant s breach of contract directly and proximately caused injury to Plaintiff, which resulted in liquidated damages in the amount of one hundred thousand dollars ($100, USD), as set forth herein. 49. Unliquidated damages. Plaintiff seeks unliquidated damages within the jurisdictional limits of this Court. 50. Attorney fees. Plaintiff is entitled to recover reasonable attorney fees under Texas Civil Practice & Remedies Code chapter 38, as authorized in a suit for breach of a written contract. Plaintiff retained counsel, who presented Plaintiff s claims to Defendant in the demand letter dated on or around October 25, Therein, Plaintiff demanded payment of $1,180,210 for actual losses incurred and expected profits, which are damages caused by reason of Defendant s breach of contract, fraudulent acts, and tortious conduct committed against Plaintiff. SECOND CAUSE OF ACTION COMMON-LAW FRAUD 51. In addition to other counts, Defendant committed common-law fraud against Plaintiff. 52. Defendant represented to Plaintiff that Defendant would fulfill the Agreement. Page 8 of 18
9 53. Plaintiff acted in reliance of Defendant s representations, including the representation that Pacquiao would appear, per the Agreement, in the Rio Grande Valley, from September 17, 2010 through September 19, 2010, in relation to the events scheduled by Imperial and hosted by various entities in conjunction with Imperial. Imperial incurred considerable costs in the promotion and organization of the event and consequently suffered additional damages due to the cancellation of Pacquiao s appearance. 54. Defendant s representations to Plaintiff were material. 55. Defendant s representations to Plaintiff were false statements of fact. 56. Defendant s representations to Plaintiff were false promises of future performance. 57. Defendant made the false representations knowing that they were false. 58. In the alternative, Defendant made the false representations recklessly, as positive assertions, and without knowledge of their truth. 59. Defendant intended for Plaintiff to rely on the false representations and had reason to expect that Plaintiff would act in reliance on the false representations. 60. Plaintiff relied on Defendant s false representations. 61. Actual damages. Defendant s false representations directly and proximately caused injury to Plaintiff, which resulted in actual damages, as set forth herein. 62. Unliquidated damages. Plaintiff seeks unliquidated damages within the jurisdictional limits of this Court. 63. Exemplary damages. Plaintiff s injury resulted from Defendant s actual fraud or malice, which entitles Plaintiff to exemplary damages under Texas Civil Practice & Remedies Code section (a). Plaintiff is entitled to exemplary damages for Defendant s fraudulent Page 9 of 18
10 acts committed against Plaintiff. Such exemplary damages should be in an amount sufficient to discourage such fraudulent acts in the future and as a penalty for the Defendant s malfeasance. Plaintiff. THIRD CAUSE OF ACTION FRAUD BY NONDISCLOSURE 64. In addition to other counts, Defendant committed fraud by nondisclosure against 65. Defendant concealed and failed to disclose material facts related to the transaction between Plaintiff and Defendant. 66. Pacquiao and his team knew that he would not appear at the September event in the Rio Grande Valley, yet failed to disclose the pertinent material facts to Imperial. Pacquiao and his team had full knowledge of the contract signed with Imperial, the above-referenced Agreement, which was signed prior to any other commitments which Pacquiao and/or his agents have claimed prevented him from fulfilling the obligations of the Agreement. 67. Defendant had a duty to disclose the information to Plaintiff because Defendant was contractually obligated to Plaintiff. 68. Defendant had a duty to disclose the information to Plaintiff because the information was new, and it made Defendant s earlier representations to Plaintiff false and misleading. 69. Defendant had a duty to disclose the information to Plaintiff because Defendant partially disclosed the information to Plaintiff, which created a substantially false impression. 70. Defendant had a duty to disclose the information to Plaintiff because Defendant voluntarily disclosed some of the information to Plaintiff. 71. The information was material. 72. Defendant knew that Plaintiff was ignorant of the information and did not have an equal opportunity to discover the truth. Page 10 of 18
11 73. Defendant deliberately remained silent and did not disclose the information to Plaintiff. 74. By deliberately remaining silent, Defendant intended for Plaintiff to act without the information. 75. Plaintiff relied on Defendant s deliberate silence. 76. Actual damages. By deliberately remaining silent, Defendant directly and proximately caused injury to Plaintiff, which resulted in actual damages, as set forth herein. 77. Unliquidated damages. Plaintiff seeks unliquidated damages within the jurisdictional limits of this Court. 78. Exemplary damages. Plaintiff s injuries resulted from Defendant s actual fraud or malice, which entitles Plaintiff to exemplary damages under Texas Civil Practice & Remedies Code section (a). Plaintiff is entitled to exemplary damages for Defendant s fraudulent acts committed against Plaintiff. Such exemplary damages should be in an amount sufficient to discourage such fraudulent acts in the future and as a penalty for the Defendant s malfeasance. FOURTH CAUSE OF ACTION TORTIOUS INTERFERENCE WITH EXISTING CONTRACTS 79. In addition to other counts, Defendant interfered with Plaintiff s existing contracts with third parties. 80. Plaintiff had valid contracts with third parties. 81. Defendant knew or had reason to know of Plaintiff s contracts with third parties, and of Plaintiff s interest in the contracts. parties. 82. Defendant willfully and intentionally interfered with Plaintiff s contracts with third 83. Actual damages. Defendant s interference proximately caused injury to Plaintiff, which resulted in actual loss and damages, as set forth herein. Page 11 of 18
12 84. Unliquidated damages. Plaintiff seeks unliquidated damages within the jurisdictional limits of this Court. 85. Exemplary damages. Plaintiff s injury resulted from Defendant s malice or actual fraud, which entitles Plaintiff to exemplary damages under Texas Civil Practice & Remedies Code section (a). Plaintiff is entitled to exemplary damages for Defendant s tortious conduct committed against Plaintiff. Such exemplary damages should be in an amount sufficient to discourage such tortious conduct in the future and as a penalty for the Defendant s malfeasance. FIFTH CAUSE OF ACTION TORTIOUS INTERFERENCE WITH PROSPECTIVE RELATIONS 86. In addition to other counts, Defendant interfered with Plaintiff s prospective relations with third parties. 87. Plaintiff was prepared to enter into contracts and had ongoing business relationships with third parties. 88. Pacquiao and his team prevented Imperial from the fulfillment of its obligations to third parties, which in turn impeded Imperial s ability to enter into prospective contracts and to continue ongoing business relationships. The prospective relations were dependent on the much publicized appearance of Pacquiao. Pacquiao and his team had full knowledge of the Agreement, of Imperial s prospective relations, and of Imperial s interest at stake in these prospective relations. 89. Defendant knew of Plaintiff s prospective contracts and ongoing business relationships with third parties and intentionally interfered. 90. Defendant knew that the interference was certain or substantially certain to occur as a result of Defendant s conduct. Page 12 of 18
13 91. Plaintiff suffered actual loss and damages, as a result of Defendant s interference. 92. Actual damages. Defendant s interference proximately caused injury to Plaintiff, which resulted in actual loss and damages, as set forth herein. 93. Unliquidated damages. Plaintiff seeks unliquidated damages within the jurisdictional limits of this Court. 94. Exemplary damages. Plaintiff s injury resulted from Defendant s malice or actual fraud, which entitles Plaintiff to exemplary damages under Texas Civil Practice & Remedies Code section (a). Plaintiff is entitled to exemplary damages for Defendant s tortious conduct committed against Plaintiff. Such exemplary damages should be in an amount sufficient to discourage such tortious conduct in the future and as a penalty for the Defendant s malfeasance. DAMAGES 95. Plaintiff is entitled to damages to the fullest extent allowed under the law. As a direct and proximate result of Defendant s breach of contract, fraudulent acts, and tortious conduct, Plaintiff suffered the following damages, in the amount of $1,180, Actual damages. Reasonable expenses, as actual losses incurred and expected profits, including but not limited to the following: a. Costs of promoting and managing the event; b. Boxing match expenses, including medical examinations, airplane tickets, prize money, and industry costs for the boxing match and approval by the World Boxing Council; Page 13 of 18
14 c. Travel expenses, in order to expedite delivery of the Agreement to Pacquiao and his team, and subsequently in an effort to resolve the anticipated breach of contract by Pacquiao and his team; d. Investors who withdrew their investment, demanded reimbursement, and declined to work with Imperial as a result of Pacquiao s cancellation; e. Venue expenses, including considerable time, finances, and resources expended to scout and book the locations, negotiate reservations, and deposits made for the boxing matches, plus venues booked for related engagements, including press conferences, photo opportunities, autograph sessions, and other publicity events such as breakfasts and dinners; f. Hotel, transportation, and vendor contracts, including the investment of considerable time, finances, and resources expended to negotiate those contracts and to coordinate with related individuals and entities to secure and fulfill those contracts; g. Press conferences and meetings held with investors and sponsors both in Texas and in México, plus confirmation of events with business leaders, elected officials, and local government representatives; h. Promotional materials, including posters and flyers, plus souvenirs, designed and ordered with pre-printed event information and the specific date and location of the event, which must be destroyed due to the cancelled event and subsequently redesigned and reordered for a future event, as yet to be rescheduled; i. Paid advertising, including television and radio spots, newspapers, magazines, and Internet publicity, plus coordination efforts with the media; Page 14 of 18
15 j. Returned tickets purchased by fans. REQUEST FOR PRELIMINARY INJUNCTION 97. Defendant, EMMANUEL PACQUIAO ( Pacquiao ), also known as Emmanuel Dapidran Pacquiao or Manny Pacman Pacquiao, is an individual located in the State of California, and a citizen of foreign nationality, specifically, of the Republic of the Philippines, hereto sued in his capacity as a professional boxer while doing business in the State of Texas. 98. A preliminary injunction is necessary to ensure that sufficient assets of Defendant are kept in the state for the satisfaction of any judgment Plaintiff might obtain in the pending suit. 99. Plaintiff will suffer irreparable injury if Defendant is not enjoined while this suit is pending because Defendant is a citizen or subject of a foreign state, specifically, with bank accounts in the Republic of the Philippines In order to avoid adjudication in the United States, Pacquiao possesses the definite and certain ability to transfer any and all business entities; property, both real and personal; and any and all other assets beyond the jurisdiction of this Court There is no adequate remedy at law in order to ensure that Defendant retains adequate funds to reimburse Plaintiff for actual losses incurred and expected profits, and to ensure that the appropriate amount to which Plaintiff may be shown entitled is not transferred, disbursed, distributed, or otherwise secreted by Defendant There is a substantial likelihood that Plaintiff will prevail on the merits, by reason of Defendant s breach of contract, fraudulent acts, and tortious conduct The harm faced by Plaintiff outweighs the harm that would be sustained by Defendant if the preliminary injunction were granted. Pacquiao insisted that the first payment of one hundred thousand dollars ($100, USD) be wired to the bank account in General Page 15 of 18
16 Santos City, Philippines. Imperial anticipates that Pacquiao may transfer, disburse, distribute, or otherwise move the money, which is owed to Imperial, to the Philippines Issuance of a preliminary injunction would not adversely affect the public interest Therefore, Plaintiff respectfully seeks injunctive relief against Defendant, by order of the Court, a preliminary injunction for the following: That Defendant EMMANUEL PACQUIAO, and Defendant s officers, agents, servants, employees, and attorneys, and all persons acting in concert with them, be enjoined from transferring, disbursing, distributing, or otherwise secreting funds received by Defendant, or subject to his control, from TOP RANK, INC. ( TOP RANK ) and/or any other person or entity, as a result of his contract to fight ANTONIO MARGARITO ( MARGARITO ) on November 13, 2010 in Arlington, Texas, in an amount up to $1.5 million, by which accounts for the $1,180,210 sought by Plaintiff as damages by reason of Defendant s breach of contract, plus attorney fees, costs of suit, and interest, to be held pending further order of this Court Plaintiff is willing to post a bond in the amount the Court deems appropriate, or, if the temporary restraining order has been granted, to continue the bond set by the Court for the temporary restraining order Plaintiff respectfully requests the Court to set its application for preliminary injunction for hearing at the earliest possible time and, after hearing the request, to issue a preliminary injunction against Defendant. ATTORNEY FEES AND COSTS 108. As a result of Defendant s breach of contract, fraudulent acts, and tortious conduct, Plaintiff retained an attorney and seeks reimbursement for its reasonable attorney fees. Plaintiff Page 16 of 18
17 is entitled to an award of attorney fees and costs under Texas Civil Practice & Remedies Code chapter 38, as authorized in a suit for breach of a written contract. CONCLUSION 109. WHEREFORE, PREMISES CONSIDERED, Plaintiff prays that the Court award judgment for Plaintiff against Defendant for the following: a. Actual loss and damages, in the amount of $1,180,210, plus interest. b. Liquidated damages, in the amount of $100, USD. c. Exemplary damages, in an amount sufficient to discourage such fraudulent acts and tortious conduct in the future and as a penalty for the Defendant s malfeasance. d. Punitive damages. e. Injunctive relief, by preliminary injunction enjoining Defendant from transferring, disbursing, distributing, or otherwise secreting funds, as set forth herein. f. Prejudgment and postjudgment interest. g. Costs of suit. h. Attorney fees. i. All such other and further relief, to which Plaintiff may be shown entitled, as this Court deems just and proper. Dated this day of November, Respectfully submitted, NGO LAW, PLLC By: /s/ Lan Q. Ngo Page 17 of 18
18 Lan Q. Ngo Texas State Bar No Southern District ID No Westpark Dr., Suite 518 Houston, Texas Tel. (832) Fax (832) ATTORNEY-IN-CHARGE FOR PLAINTIFF, IMPERIAL ED PROMOTIONS, LLC OF COUNSEL: Thomas F. Coleman Texas State Bar No LAW OFFICE OF TOM F. COLEMAN 2211 Norfolk St., Suite 528 Houston, Texas Tel. (713) Fax (713) Page 18 of 18
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