Free Reply - District Court of Arizona - Arizona

1 Terry E. Fenzl (#002485) C. Mark Kittredge (#013907) 2 PERKINS COIE BROWN & BAIN P.A. 3 2901 North Central Avenue Post Office Box 400 4 Phoenix, Arizona 85001-0400 (602) 351-8000 5 [email protected] 6 [email protected] 7 Attorneys for Defendants 8 9 10 11 12 Richard G. Krauth, an individual, and R.M. Wade & Co., an Oregon corporation, 13 Plaintiffs, 14 15 vs. No. CV 04-0544 PHX PGR DEFENDANTS' REPLY TO PLAINTIFFS' RESPONSE TO DEFENDANTS' STATEMENT OF FACTS; AND DEFENDANTS' RESPONSE TO PLAINTIFFS' STATEMENT OF FACTS IN SUPPORT OF PLAINTIFFS' RESPONSE IN OPPOSITION TO DEFENDANTS' MOTION FOR SUMMARY JUDGMENT UNITED STATES DISTRICT COURT DISTRICT OF ARIZONA

16 Phelps Dodge Corporation, a New York 17 corporation, et al., 18 19 20 Phelps Dodge Corporation, a New York corporation, et al., 21 Counterclaim Plaintiffs, 22 23 vs. Defendants.

24 Richard G. Krauth, an individual, and R.M. 25 Wade & Co., an Oregon corporation, 26 27 28
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Counterclaim Defendants.

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Pursuant to Fed. R. Civ. P. 56 and LRCiv 56.1, defendants submit this Response to: (i) Plaintiffs' Response to Defendants' Statement of Facts ("Plaintiffs' Response to SOF"); and (ii) Plaintiffs' Statement of Facts in Support of Plaintiffs' Response in SOF").1 I. REPLY TO PLAINTIFFS' RESPONSE TO SOF. 1. Plaintiffs' alleged dispute with respect to paragraph 1 of Defendants' Opposition to Defendants' Motion for Summary Judgment ("Plaintiffs' Opposition

Statement of Facts ("Defendants' SOF") does not create a bona fide dispute as to a material fact because plaintiffs expressly admit that "the parties did agree to all terms [of the Settlement Agreement] by October 2005" and that is the basis for Defendants' Motion for Summary Judgment. [Pls.' Resp. to SOF, ¶ 2] 2.

Plaintiffs' alleged dispute with respect to paragraph 2 of Defendants' SOF

does not create a bona fide dispute as to a material fact because Plaintiffs expressly admit that "the parties did agree to all terms [of the Settlement Agreement] by October 2005" and that is the basis for Defendants' Motion for Summary Judgment. [Id.] 3. Plaintiffs' alleged dispute with respect to paragraph 3 of Defendants' SOF

does not create a bona fide dispute as to a material fact for at least two reasons. First, the evidence cited by plaintiffs simply does not address the assertion that the document at issue contained "plaintiffs' `final' proposed modifications." Second, in any event, any dispute here is immaterial because Plaintiffs expressly admit that "the parties did agree to Defendants' Motion for Summary Judgment. [Id.] 4. Defendants' SOF. 5. No reply is necessary because Plaintiffs do not dispute paragraph 5 of Defendants' SOF. Plaintiffs' Response to SOF and Plaintiffs' Opposition SOF were filed as a single document, at Docket No. 66.
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all terms [of the Settlement Agreement] by October 2005" and that is the basis for

No reply is necessary because Plaintiffs do not dispute paragraph 4 of

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6.

No reply is necessary because Plaintiffs do not dispute paragraph 6 of

Defendants' SOF. II. REPLY TO PLAINTIFFS' OPPOSITION SOF. The alleged facts asserted in Paragraphs 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 18, 19 and 20 of Plaintiffs' Opposition SOF are not facts that are material to Defendants' Motion for Summary Judgment Enforcing Settlement Agreement, which is

based solely on the parties' agreement to all terms of the Settlement Agreement in October 2005, as evidenced by undisputed email letters between the parties. Although they are not material to the subject motion and therefore need not and should not be considered by by the Court at this time, Defendants herein explain that they dispute these allegations and reserve their right to challenge these allegations in the future in the event such allegations are deemed relevant for any future purpose. 1. The allegations of Paragraph 1 (regarding the timing of the stay and the filing date of the Request for Reexamination) are not material to Defendants' Motion for Summary Judgment and cannot create a genuine issue of material fact. Defendants dispute Paragraph 1 of Plaintiffs' Opposition SOF and Paragraph 2 of the Declaration of Peter E. Heuser in Support of Plaintiffs' Summary Judgment Briefing ("Heuser Declaration") because they contradict Mr. Heuser's October 14, 2004 representation to Defendants that the documents were filed on October 5, 2004. 2. The allegations of Paragraph 2 (regarding a verbal agreement between the parties in January 2005) are not material to Defendants' Motion for Summary Judgment (which is based on written communications in October 2005) and cannot create a genuine issue of material fact. Defendants dispute paragraph 2 of Plaintiffs' Opposition SOF to the extent it is inconsistent with the transcript of Heuser's voicemail and the parties sworn interrogatory responses. [Heuser Decl. Ex. B, Tedesco Decl. Ex. A 5:10-14, Ex. B 3:14-19] Defendants dispute Paragraph 5 of the Heuser Declaration because, as is clearly demonstrated in Exhibit B to the Heuser Declaration, Plaintiffs offered to settle the case "regardless of what happens in the PTO,." and Mr. Heuser never stated that any terms of
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the agreement, including the term that the settlement would be "regardless of what

happens in the PTO", would be contingent upon the execution of a written settlement agreement. [Heuser Decl. Ex. B] Defendants dispute the contention in Paragraph 6 of the Heuser Declaration that "[Kittredge] said that the only possible issue was the confidentiality clause, but that he thought we would be able to work that out." [Tedesco Decl. Ex. A 5:10-14, Ex. B 3:14-19] 3. The allegations of Paragraph 3 (regarding preparation of the written

memorialization of a verbal agreement in January 2005) are not material to Defendants' Motion for Summary Judgment (which is based on written communications in October 2005) and cannot create a genuine issue of material fact. Defendants dispute Paragraph 3 of Plaintiffs' Opposition SOF and Paragraph 7 of the Heuser Declaration to the extent that any statements contained in these Paragraphs are inconsistent with the text of the referenced document. [Heuser Decl. Ex. C] 4. The allegations of Paragraph 4 (regarding a draft agreement in January 2005) are not material to Defendants' Motion for Summary Judgment (which is based on written communications in October 2005) and cannot create a genuine issue of material fact. Defendants dispute Paragraph 4 of Plaintiffs' Opposition SOF and Paragraph 8 of the Heuser Declaration to the extent that any statements contained in these Paragraphs are inconsistent with the text of the referenced document. [Heuser Decl. Ex. D] 5. The allegations of Paragraph 5 (regarding a draft agreement in February 2005) are not material to Defendants' Motion for Summary Judgment (which is based on written communications in October 2005) and cannot create a genuine issue of material fact. Defendants dispute Paragraph 5 of Plaintiffs' Opposition SOF and Paragraph 9 of the Heuser Declaration to the extent that any statements contained in these Paragraphs are inconsistent with the text of the referenced document. [Heuser Decl. Ex. E] 6. The allegations of Paragraph 6 (regarding a conversation in February 2005) are not material to Defendants' Motion for Summary Judgment (which is based on written communications in October 2005) and cannot create a genuine issue of material
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fact. Defendants dispute Paragraph 6 of Plaintiffs' Opposition SOF and Paragraph 3 of the Heuser Declaration to the extent that any statements contained in these Paragraphs are inconsistent with the text of the referenced document. [Heuser Decl. Ex. A] Defendants further dispute Paragraph 6 of Plaintiffs' Opposition SOF and Paragraph 10 of the Heuser Declaration to the extent that the description of the February 14, 2005 conversation between Kittredge and Heuser described in these paragraphs is inconsistent with Kittredge's recollection of the conversation as set out in Phelps Dodge's Responses to Plaintiffs' Second Set of Interrogatories and supported by Kittredge's handwritten notes documenting the conversation. [Tedesco Decl. Ex. A 5:22-6:4, Kittredge Decl. ¶ 2, Ex. B] 7. The allegations of Paragraph 7 (regarding a draft agreement in March 2005) are not material to Defendants' Motion for Summary Judgment (which is based on written communications in October 2005) and cannot create a genuine issue of material fact. Defendants dispute Paragraph 7 of Plaintiffs' Opposition SOF and Paragraph 11 of the Heuser Declaration to the extent that any statements contained in these Paragraphs are inconsistent with the text of the referenced document. [Heuser Decl. Ex. G] 8. The allegations of Paragraph 8 (regarding a conversation in April 2005) are not material to Defendants' Motion for Summary Judgment (which is based on written communications in October 2005) and cannot create a genuine issue of material fact. Defendants dispute Paragraph 8 of Plaintiffs' Opposition SOF and Paragraphs 12-14 of the Heuser Declaration. Kittredge's recollection of this conversation contradicts that of Heuser and he will so testify if called to do so. [Tedesco Decl. Ex. A 6:9-20, Ex. B 3:2027] Further, Defendants dispute Paragraph 8 of Plaintiffs' Opposition SOF and

Paragraph 14 of the Heuser Declaration to the extent that any statements contained in these Paragraphs are inconsistent with the text of the referenced document. [Heuser Decl. Ex. I] Specifically, the email cited by Plaintiffs as confirming the telephone conversation with Kittredge does not state that Heuser informed Mr. Kittredge that "if the PTO did not reject all of the claims of the patents-in-suit, the settlement negotiations
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would change directions entirely;" rather, that email notes that the parties "have put the

case to bed," demonstrating that there was a meeting of the minds and a binding agreement. [Heuser Decl. Ex. H] 9. The allegations of Paragraph 9 (regarding an attorney-client communication

between Plaintiffs and their counsel, and a subsequent email letter to Defendants in April 2005) are not material to Defendants' Motion for Summary Judgment (which is based on written communications in October 2005) and cannot create a genuine issue of material fact. Defendants dispute Paragraph 9 of Plaintiffs' Opposition SOF and Paragraph 13 of the Heuser Declaration to the extent that any statements contained in these Paragraphs are inconsistent with the text of the referenced document. [Heuser Decl. Ex. H] 10. The allegations of Paragraph 10 (regarding an email letter and telephone conversation in May 2005) are not material to Defendants' Motion for Summary Judgment (which is based on written communications in October 2005) and cannot create a genuine issue of material fact. Defendants dispute Paragraph 10 of Plaintiffs'

Opposition SOF and Paragraph 15 of the Heuser Declaration to the extent that any statements contained in these Paragraphs are inconsistent with the text of the referenced document. [Heuser Decl. Ex. J] To the extent the referenced conversation occurred, Kittredge remembers the conversation occurring in late summer 2005. [Tedesco Decl. Ex. A 6:21-22, 7:20-8:4, Ex. B 2:25-3:4] Whenever it occurred, there is no material difference between Kittredge's and Heuser's recollection of what was said in the conversation. 11. The allegations of Paragraph 11 (regarding a conversation in late summer 2005) are not material to Defendants' Motion for Summary Judgment (which is based on written communications in October 2005) and cannot create a genuine issue of material fact. Defendants do not dispute Paragraph 11 of Plaintiffs' Opposition SOF. 12. The allegations of Paragraph 12 (regarding a draft agreement in June 2005) are not material to Defendants' Motion for Summary Judgment (which is based on written communications in October 2005) and cannot create a genuine issue of material
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fact. Defendants dispute Paragraph 12 of Plaintiffs' Opposition SOF and Paragraph 16 of the Heuser Declaration to the extent that any statements contained in these Paragraphs are inconsistent with the text of the referenced document. [Heuser Decl. Ex. K] Defendants also dispute that the parties had not previously discussed the provisions of this draft. [Tedesco Decl. Ex. A 6:9-22, Ex. B 3:20-27] 13. The allegations of Paragraph 13 (regarding communications between the parties in June 2005) are not material to Defendants' Motion for Summary Judgment (which is based on written communications in October 2005) and cannot create a genuine issue of material fact. Defendants dispute Paragraph 13 of Plaintiffs' Opposition SOF and Paragraph 17 of the Heuser Declaration to the extent that any statements contained in these Paragraphs are inconsistent with the text of the referenced document. [Heuser Decl. Ex. L] 14. The allegations of Paragraph 14 (regarding communications in August 2005) are not material to Defendants' Motion for Summary Judgment (which is based on written communications in October 2005) and cannot create a genuine issue of material fact. Defendants dispute Paragraph 14 of Plaintiffs' Opposition SOF and Paragraph 19 of the Heuser Declaration to the extent that any statements contained in these Paragraphs are inconsistent with the text of the referenced document. [Heuser Decl. Ex. M, Tedesco Decl. Ex. D] Defendants do not dispute that Kittredge left a voice message for Heuser on August 12, 2005 and that a transcript of that voice message was produced by Plaintiffs with recent discovery responses. [Heuser Decl. Ex. M] 15. Defendants do not dispute the allegations in Paragraph 15. Regardless, this allegation is not material to Defendants' Motion for Summary Judgment because that motion is not based on the oral agreement reached in January 2005, but is based on the written agreement finalized in October 2005. 16. 17. Defendants do not dispute Paragraph 16 of Plaintiffs' Opposition SOF. Defendants do not dispute Paragraph 17 of Plaintiffs' Opposition SOF.

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18.

The allegations of Paragraph 18 (regarding a conversation that occurred

after the written communications upon which the subject motion is based) are not material to Defendants' Motion for Summary Judgment (which is based on written communications in October 2005) and cannot create a genuine issue of material fact. Defendants dispute Plaintiffs' characterization of the conversation that occurred on October 20, 2005, specifically, with reference to the allegation that "Kittredge

acknowledged that Heuser had said the agreement needed to be executed before Wade received a favorable ruling from the PTO or the parties would be back to negotiating." Indeed, this is a red herring as Plaintiffs have not alleged that they ever made such an unequivocal statement. Rather, Plaintiffs' actual allegation is that on May 10, 2005, "Heuser said that if [the PTO did not reject all claims] this could entirely change the direction of the negotiations." [Kittredge Decl. ¶ 3, Ex. B 4:17-24] Kittredge remembers that conversation occurred in late summer of 2005 (rather than May 10, 2005) and recalls that Heuser said "that if the Patent Office issued a favorable Office Action before the written settlement agreement was signed, then he thought his clients position would be that all bets would be off." [Tedesco Decl. Ex. A 7:20-8:4] Regardless of when the conversation occurred, both parties agree that the statements made by Heuser were, at best, equivocal, indicating what "could" happen or what he "thought" his clients might do. Plaintiffs have not alleged otherwise. During the conversation on October 20, 2005, Kittredge merely acknowledged that such a statement had been made. [Kittredge Decl. ¶ 4] Defendants dispute Paragraph 18 of Plaintiffs' Opposition SOF and Paragraphs 24 of the Heuser Declaration to the extent that any statements contained in these Paragraphs are inconsistent with the text of the referenced document. [Heuser Decl. Ex. Q, Tedesco Decl. Ex. A] 19. Regardless, this allegation is not material to Defendants' Motion for Summary Judgment because that motion is not based on the oral agreement reached in January 2005, but is based on the written agreement finalized in October 2005.
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Defendants do not dispute Paragraph 19 of Plaintiffs' Opposition SOF.

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20.

Regardless, this allegation is not material to Defendants' Motion for Summary Judgment

Defendants do not dispute Paragraph 20 of Plaintiffs' Opposition SOF.

because that motion is not based on the oral modification reached between February and April 2005, but is based on the written agreement finalized in October 2005. Dated: April 18, 2006. PERKINS COIE BROWN & BAIN P.A.

By s/ C. Mark Kittredge Terry E. Fenzl C. Mark Kittredge 2901 North Central Avenue Post Office Box 400 Phoenix, Arizona 85001-0400 Attorneys for Defendants and Counterclaim Plaintiffs

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CERTIFICATE OF SERVICE I hereby certify that on April 18, 2006, I electronically transmitted the attached documents to the Clerk's Office using the CM/ECF System for filing and transmittal of a Notice of Electronic Filing to the following CM/ECF registrants: Daniel R. Malinski [email protected] BURCH & CRACCHIOLO, P.A. 702 East Osborn, Suite 200 Phoenix, Arizona 85014 Attorneys for Plaintiffs and Counterclaim Defendants Peter E. Heuser [email protected] Kolisch Hartwell, P.C. 200 Pacific Building 520 S.W. Yamhill Street Portland, Oregon 97204 Attorneys for Plaintiffs and Counterclaim Defendants I hereby certify that on April 18, 2006, I served the attached document by hand delivery to: The Honorable Paul G. Rosenblatt United States District Court Sandra Day O'Connor U.S. Courthouse, Suite 621 401 West Washington Street, SPC 56 Phoenix, AZ 85003-2156 s/ Janet Roe

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