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Case 1:06-cv-00005-JJF Document 54 Filed O4/24/2007 Pagei of 3
COZEN
O’CONNOR
ATTORNEYS
A PROFESSIONAL CORPORATION
suns 1400 CHASE MANHATTAN crmrar 1201 Nom MARKET swarm WILMINGTON, or 19801-1147
302.295.2000 8882072440 302.295.20l3 FAX www.cozen.com
April 24, 2007 David A. Felice
Direct Phone 302.295.20ll
VIA HAND DELIVERY ”"°“ F3§.i..§€Z§£;T’.i,E.
The Honorable Joseph J. Farnan, Jr.
U.S. District Court, District of Delaware
844 North King Street
Wilmington, DE 19801
Re: Jejfrey M Norman v. David W Elkin, et al.; C.A. N0. 06-005-JJF
Dear Judge Farnan:
This firm represents Plaintiff Jeffrey M. Norman ("Plaintiff" or "Norman") in the above-
referenced action. We write pursuant to D. Del. LR 7.1.3(c)(2), as defendants first raised in their
reply brief a new legal argument that this case is controlled by the decision in United States
Cellular Inv. C0. of Allentown v. Bell Atlantic Mobile Systems, Inc., 677 A.2d 497 (Del. 1996).
Plaintiff disagrees with Defendants’ contention that the "holding and principals affirmed in
United States Cellular are dispositive.” lf, however, Defendants’ contention is considered, D.
Del. LR 7.1.3 required that the 1996 Delaware Supreme Court case should have been cited in a
full and fair opening brief to permit Plaintiff the opportunity to respond. As Defendants violated
D. Del. LR 7.1.3 by reserving a discussion of this “dispositive" decision for their reply brief,
Plaintiff submits that the argument is properly stricken from the record.
Should the Court consider the United States Cellular decision, Plaintiff submits the
following factual issues that distinguish the instant action from the United States Cellular
decision.
• The parties’ relationship in United States Cellular was governed by a written
limited partnership agreement. United States Cellular, 677 A.2d at 498. Here,
the relationship between Norman and David Elkin ("Elkin") in US Mobilcomm
("USM") was not governed by a written agreement.
• The limited partnership agreement in United States Cellular specifically defined
corporate opportunities and identified to what extent a partner was permitted to
compete with the partnership. Id at 499. Here, identification of a corporate
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Case 1:06-cv-00005-JJF Document 54 Filed O4/24/2007 Page 2 of 3
The Honorable Joseph J. Farnan, Jr.
April 24, 2007
Page 2
opportunity and the parties’ responsibilities to one another is governed by
common law.
• In United States Cellular, the plaintiff/limited partner had reason to believe that
the defendant/general partner was going to violate the limited partnership
agreement by acquiring additional Federal Communications Commission
("FCC") licenses. ld As a result, the limited partner sent a letter to the general
partner reciting its interpretation of the limited partnership agreement’s
permissible competition provisions, demanding that the general partner act
accordingly. Id Here, Norman had absolutely no reason to believe that Elkin
would convert the Phase II Auction opportunities for himself. Indeed,
immediately following the Auction, Norman corresponded with Elkin concerning
the auction, and Elkin refused to disclose his covert application amendment
scheme.
• The general partner in United States Cellular actually submitted an application in
its y for the FCC licenses placed at issue. Id at 500. Here, Elkin first
submitted an application in the name of USM and only after the bidding during
the Phase II Auction was underway did he submit an amendment to the original
application.] (D.I. 51 at p. 7).
• In preparing for the FCC license lottery, the general partner in United States
Cellular executed several settlement agreements with other lottery applicants
(such that the other applicants would withdraw their applications from the lottery
and the general partner would be awarded the license). United States Cellular,
677 A.2d at 500. The general partner’s settlement agreements were filed with the
FCC. Id Thereafter, the FCC issued a Public Notice of the settlements,
specifically identifying the general partner. Id Here, the only FCC Public
Notices placed at issue do not, in any way, identify the parties that usurped
USM’s opportunity — Elkin or The Elkin Group. Instead, the FCC’s Public
Notices uniformly identify USM as the qualified bidder and the only applicant
that was awarded the licenses. (D.I. 51 at pp. 7, 9).
• In United States Cellular, the general partner filed an application to transfer the
FCC licenses to its New Jersey affiliate. United States Cellular, 677 A.2d at 500.
Here, Elkin did not file any such transfer application. Instead, Elkin executed a
covert scheme to "amend" an earlier USM-published application that was already
subject to the FCC’s Public Notice. (D.I. 51 at p. 8).
• The plaintiff/limited partner in United States Cellular did not allege any
fraudulent concealment on the part of the defendant/general partner. Here, the
record is replete with Elkin’s fraudulent representations to Norman and Elkin’s
fraud by omission. (DI. 51, pp. 12 — 18, 28 — 31).
1 This purported amendment is curiously absent from any production in this action and has not
been produced by Defendants nor its existence on an FCC website identified.
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Case 1:06-cv-00005-JJF Document 54 Filed O4/24/2007 Page 3 of 3
The Honorable Joseph J. Faman, Jr.
April 24, 2007
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• The United States Cellular court recognized that the limited partnership had
regular partnership meetings and distributed quarterly financial statements.
United States Cellular, 677 A.2d at 504. Here, USM did not have annual
stockholder meetings and Elkin failed to discharge his fiduciary duty of
disclosure. The only financial statement Norman received following the Phase II
Auction was a November 1998 "draft" financial statement that was issued before
the Phase Il licenses were even scheduled to be issued by the FCC. (D.I. 51 at p.
15).
Based on the foregoing, Norman submits that the United States Cellular decision is not
dispositive of the issues presented in Defendants’ Motion for Summary Judgment. In fact, the
factual disparities presented in this case compel a finding that Norman did not have actual or
constructive notice of Defendants’ wrongful conduct.
We look forward to discussing these issues with Your Honor at the pretrial conference on
May 10, 2007. In the interim, should Your Honor have any questions or concerns about this
matter, counsel is available at Your Hon0r’s convenience.
Respectfully,
David A. Felice (#4090)
DAF/ssl
cc: Clerk of the Court (via ECF)
Steven Caponi, Esquire (via ECF)
Mark A. Evetts, Esquire (via email)
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