Free Reply to Response to Motion - District Court of Arizona - Arizona

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David P. Irmscher (Indiana State Bar No. 15026-02) John K. Henning (Indiana State Bar No. 25203-49) Baker & Daniels LLP 111 East Wayne Street, Suite 800 Fort Wayne, IN 46802 Telephone: 260-424-8000 Facsimile: 260-460-1700 Ray Harris (Arizona State Bar No. 007408) Paul Moore (Arizona State Bar No. 019912) Fennemore Craig 3003 North Central Avenue, Suite 2600 Phoenix, AZ 85012-2913 Telephone: 602-916-5000 Facsimile: 602-916-5999 Attorneys for the defendant, Omron Corporation

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA

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Hypercom Corporation,
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CAUSE NO. CV04-0400 PHX PGR DEFENDANT OMRON CORPORATION' REPLY IN S SUPPORT OF MOTION FOR SUMMARY JUDGMENT (ORAL ARGUMENT REQUESTED)

Plaintiff,
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vs.
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Omron Corporation,
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Defendant
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In opposing summary judgment, Hypercom has asked this Court to do something no federal court has ever done: impose vicarious liability on a patent assignor for the purported misconduct of its assignee. Indeed, no court has ever held a licensor vicariously liable for its licensee' torts. As set forth below, there is no factual, legal, or equitable s basis for Hypercom' claims against Omron. Accordingly, Omron is entitled to judgment s as a matter of law. I. OMRON HAS NO RIGHT OR DUTY TO "IMMUNIZE" HYPERCOM FROM LAWSUITS BY VERVE A. The Assignment Grants Omron No Veto Over Unaffiliated Licensing Targets At the heart of Hypercom' lawsuit lies the fiction that Omron, were it so disposed, s could end any prosecution of claims on patents assigned to Verve.1 This theory founders on disclosed documents. When Omron assigned various patents to Verve, it received only limited rights to curtail their assertion by Verve. Specifically, Omron received the right to determine whether any potential licensee "is a present customer or client of OMRON prior to VERVE contacting, notifying, or filing suit against that potential licensee." See Statement Of Facts In Support Of Omron Corporation' Motion For Summary Judgment s ("Omron' SOF") ¶ 33. Thus, Omron' ability to "approve" licensing "targets" is nothing s s more than a right to shield business partners. Omron' SOF ¶¶ 32-34. Conversely, s Omron has no right or ability to "disapprove" entities ? like Hypercom ? with whom it does no business. See generally Omron' SOF ¶¶ 28-34. s Nor, even disregarding business relationships, are matters as Hypercom suggests. Licenses command significant value in the marketplace, and are almost never granted without consideration. A gratuitous license, moreover, would impose significant costs on Omron. Once Verve files suit, Omron must reimburse Verve "for all of its reasonable
1

Hypercom insists that Omron "retained the right to grant licenses under the Omron patents to anyone, without limitation, including anyone that Verve had already sued, and could have granted Hypercom immunity from suit by Verve at any time." Hypercom Corporation' Opposition To Omron' Motion For Summary Judgment s s ("Hypercom' Response") at 10. Elsewhere, Hypercom accuses Omron of "specifically approv[ing] Hypercom as a s target" of Verve' patent infringement actions. Hypercom' Response at 5. s s
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third-party attorney fees, out-of-pocket costs and expert witness fees which VERVE has incurred in its attempts to obtain COLLECTED LICENSING REVENUE from the licensed party." Omron' SOF ¶ 40. Such fees are precisely what Hypercom seeks to s recover by prosecuting this suit. Hypercom, in short, is not a business partner of Omron. Nor can Hypercom explain why Omron should grant it something for nothing, "gifting" valuable licensing rights and buying the dismissal of Verve' claims. The idea driving this action ? that s Omron could have commanded or persuaded its assignee to desist ? is pure invention. Omron had no such power over Verve. B. Omron Had No Duty To Police Verve

A second fiction behind Hypercom' lawsuit is the idea that Omron owes a duty to s oversee Verve. Patent holding companies, according to this view, are illegitimate.

Hypercom implies that by assigning patents to a company that does not make or sell
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products, Omron acquired the duty to police that company' exercise of assigned rights. s The claim is untenable. What Hypercom mistakes for impropriety ­ the patent holding company ? is a common business model. Patent owners often assign patents to holding companies to maximize revenues. As a National Law Journal article explained: Savvy manufacturers often consider transferring their patents to a patentholding company. This transfer can allow a business to increase its focus on maximizing the return from its patents by shifting the responsibility of developing licensing programs from the manufacturer to the holding company. The transfer may also provide increased business efficiencies in having one organization perform all administrative tasks to maintain the patents and run licensing programs. Robert A. Matthews, Jr., Patent Holding Companies Hold Risks, Rewards, 229 The Legal Intelligencer 21, 21 (July 30, 2003). There is no link between holding companies and harassment. Holding companies are no better able than any other owner ­ whether manufacturer, seller, or inventor ­ to assert meritless claims. Nor are Hypercom' remaining insinuations about patent holding companies valid. s

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First, they are not joint ventures. Businesses that assign patents typically bargain for some percentage of licensing revenue as consideration for an assignment. That does not make them co-owners of the patent. Indeed, the law imposes no duty on assignors to monitor the conduct of assignees, whatever the payment arrangement between them. Significantly, Verve can cite no case holding an assignor vicariously liable for an assignee' misconduct. s Second, the risks assumed by holding companies are legitimate. Hypercom quotes Omron' anticipation of eliminating risk by assigning patents, then accuses Omron of s avoiding sanctions for frivolous claims.2 This is a rhetorical "bait and switch." Many risks accompany non-frivolous litigation ­ risks, for example, that "retail operations [will] be dragged into [the] lawsuits," risks that officers and directors would be sidetracked from their business duties, risks of frivolous counter-suits, 3 and the fundamental risk that a patent owner will invest money without return. Assignments that eliminate such costs are neither illegal nor difficult to explain.

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Finally, patent holding companies do not commit wrongs without remedies. Existing remedies (including sanctions, malicious prosecution and abuse of process liability) provide Hypercom ample and appropriate redress. If Verve prosecuted frivolous lawsuits against Hypercom, then Hypercom can prosecute abuse of process and malicious prosecution claims against Verve. By contrast, retributive lawsuits against innocent

assignors are the wrong way to address Hypercom' "wave of [patent system] abuse." s Hypercom' Response at 14. s As explained more fully below, Hypercom' call to action ­ "[e]vil will only s flourish when good men stand by and do nothing" ? is curiously misdirected. allegation suggests Omron profited from a frivolous claim against Hypercom. No No

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Hypercom complains that by assigning its patents, "Omron attempted to avoid any risk of liability for bringing patent infringement claims against Hypercom." Hypercom Corporation' Statement Of Facts In Opposition To s Omron' Motion For Summary Judgment ("Hypercom' SOF" or "Hypercom' Statement Of Facts") ¶ 32. s s s
3

See Pamela S. Chestek, Control of Trademarks by the Intellectual Property Holding Company, 41 IDEA 1, 9 (2001).
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evidence suggests Omron agreed to any campaign of frivolous lawsuits. And no court has held an assignor vicariously liable for misconduct by its assignee. Even were it right about infringement, Hypercom would be wrong to sue Omron. There is no legal, moral, or equitable basis to hold Omron responsible for the conduct of Verve. II. HYPERCOM IDENTIFIES NO EVIDENCE OF A CONSPIRACY A full nine pages into its response, Hypercom finally identifies its specific claim against Omron: i.e., that Omron allegedly agreed to provide Verve with patents so that Verve could sue Hypercom "without regard to whether or not Hypercom infringed the patents, and without any good faith basis for believing that Hypercom infringed the asserted patents." Hypercom' Response at 9. s This is a revealing formulation. Hypercom does not contend ? and certainly lacks evidence to suggest ? that Omron knew Hypercom was not an infringer. Rather, Hypercom contends Omron did not care. Omron, in other words, transferred patent rights without independently investigating Verve' s

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claims. This is not a conspiracy. As set out above, the purpose of assignment is to cede the business of asserting patents to someone else. The transfer made it Verve' prerogative to s evaluate potential infringers and licensees. The transfer relieved Omron of any role or expense in making such determinations. And the evidence is consistent: Omron played no part in selecting Hypercom as a licensing target or prosecuting Verve' claims against s it. Omron' SOF ¶¶ 57-61. s Hypercom' "conspiracy" is nothing more than an assignment of rights. There is s no unlawful purpose or unlawful means. Compare Wells Fargo Bank v. Arizona Laborers, Teamsters And Cement Masons Local No. 395 Pension Trust Fund, 201 Ariz. 474, 498, 38 P.3d 12, 36 (2002) (a civil conspiracy requires "two or more people [to] agree to accomplish an unlawful purpose or to accomplish a lawful object by unlawful means, causing damages") (internal citation omitted). There is no issue for trial. A. Celotex, not Beltz, Governs Omron' Burden on Summary Judgment s

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Having failed to identify a conspiracy, Hypercom cannot prove one.

In fact,

Hypercom first contends it need not prove anything because Omron neglected to submit an affidavit denying the alleged conspiracy with Verve. Hypercom relies on Beltz Travel Service, Inc. v. International Air Transport Assoc., 620 F.2d 1360 (9th Cir. 1980) ­ a case it describes as apparently controlling. Hypercom' Response at 1-2. Appearances aside, s Beltz precedes the Supreme Court' extensive commentary on this issue in Celotex Corp. s v. Catrett, 477 U.S. 317, 322 (1986). Celotex holds that while the moving party must "inform [] the district court of the basis for its motion," there is no requirement that it "support its motion with affidavits or other similar materials negating the opponents claim." Id. at 323. Celotex clarifies that Rule 56 of the Federal Rules of Civil Procedure should not be interpreted "to mean that the burden is on the [moving] party . . . to produce evidence showing the absence of a genuine issue of material fact. . . . " Id. at 325. Rather, "the burden on the moving party may be discharged by ` showing' ? that is, pointing out to the district court ? that there is an absence of evidence to support the nonmoving party' s case." Id. Nor, even without Celotex, could Hypercom' argument succeed. s Omron

introduced evidence that: (1) the only agreements between Verve and Omron have been disclosed; and (2) those agreements are legitimate and expressly authorized by statute.4 As this evidence negates any claim of conspiracy, Hypercom' primary response to s Omron' motion for summary judgment fails. s B. Hypercom Identifies No Evidence of a Conspiratorial Agreement

Alternatively, Hypercom attempts to make a circumstantial case for conspiracy. But here too, it misstates Omron' position and governing law. Hypercom contends that: s (1) a conspiracy requires something less than an express agreement; and (2) Omron has mistakenly interpreted conspiracy to require an agreement in writing. Hypercom' s

4

See 35 U.S.C. § 261 (1982).

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Response at 2-4. Omron, however, disputes neither that conspiratorial agreements can be oral, nor that circumstantial evidence can prove them. And contrary to Hypercom' s contentions, the law clearly requires an actual agreement between conspirators. The Arizona Supreme Court confirms: "a claim for civil conspiracy must include an actual agreement, proven by clear and convincing evidence . . . ." Wells Fargo Bank, 201 Ariz. at 499, 38 P.3d at 37 (emphasis added). Indeed, the clear and convincing standard applies to circumstantial as well as direct evidence, and at summary judgment as well as trial. Compare Wells Fargo Bank, 201 Ariz. at 499, 38 P.3d at 37 (affirming summary judgment in favor of defendant despite suspicious conduct where "evidence of an agreed upon conspiratorial arrangement [could not] rise to the clear and convincing level"). Hypercom' claims fail, moreover, irrespective of standards. Acts explained by s disclosed agreements cannot imply undisclosed collusion. As the record contains nothing else, it raises no issue for trial.

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5

1.

Omron Had No Power to Disapprove Hypercom as Potential Licensee

As conspiracy "evidence," Hypercom primarily asserts that "Omron knew that Verve was going to sue Hypercom with [patents it was assigning,] specifically approved Hypercom as a target[, and] had no good faith basis for believing that Hypercom infringed any of its patents." Hypercom' Response at 5. But as explained, Omron did not s investigate the merits of any patent infringement claim against Hypercom because Omron has made none. Omron assigned its patents, together with the right to enforce them, to Verve. Thus Omron did not control any selection of target licensees, in litigation, or in strategic decision-making of any kind. 5 And Omron only learned of Verve' plans to s
Verve' Principal, Raymond Galasso, testified as follows: s Q: During the time that Verve has been prosecuting lawsuits against various companies relating to the Omron patents, have you periodically kept [Omron' attorney] informed of the progress of any of those s proceedings? A: No. ... Q: Have you had any communications with anyone else at Omron to keep them informed or to coordinate with
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pursue licensing with specific entities as necessary to shield business partners from infringement claims. See Omron' SOF ¶¶ 31-34. Indeed, as to the infringement of s assigned patents by Hypercom' products, Omron formed no opinion at all. s Embroidering the facts, Hypercom insists that Omron knew Hypercom did not manufacture cash registers 6 covered by its patents when "approving" Hypercom as a "target" in the Michigan and Texas actions. Response at 9. This claim is doubly disingenuous. First, Hypercom cites no evidence7 ? and none exists ? that Omron knew anything about Hypercom' products at the time Verve filed suit. Cf. Omron' SOF ¶ 57; s s see also Omron' Supp. SOF ¶ 73. Second, Omron had no right to veto any action against s a non-business partner. See discussion, infra. The claim that Omron failed to do

something it could not do (and certainly could not do without material cost) cannot suggest anything. In no event can it show pre-assignment collusion between Omron and Verve. See generally Richards v. Neilsen Freight Lines, 810 F.2d 898, 904 (9th Cir. 1987)

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(holding, in the context of an antitrust claim, that conduct "as consistent with permissible competitive behavior as with illegal conspiracy does not, without more, support an inference of conspiracy"). 2. Inventor Contacts Cannot Suggest Pre-Assignment Collusion

As further "evidence" of conspiracy, Hypercom offers evidence that: (1) Omron helped Verve contact the Japanese inventor of the patented technologies; and (2) Omron found an attorney to represent the inventor in communications regarding the ITC proceedings. Hypercom' Response at 10. s
them . . . the status of those proceedings? A: No. Omron' SOF ¶ 46. s
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Hypercom asserts that Omron knew the assigned patents "covered" electronic cash register technology. Hypercom' Response at 9. s
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See Omron' Response To Hypercom' Statement Of Facts In Opposition To Omron' Motion For Summary s s s Judgment And Supplemental Statement Of Facts In Support Of Motion For Summary Judgment ("Omron' Supp. s SOF") at 3-4.

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If relevant evidence tends to make consequential facts more or less probable, this "evidence" is irrelevant. See Fed. R. Evid. 401. Omron, by assigning patents, transferred litigation rights to Verve. Thus Omron subsequently did what parties who transfer

litigation rights commonly do: facilitate access to potential witnesses. Omron' Supp. s SOF ¶ 69. Omron even did what businesses commonly do for foreign businesses:

recommend a trusted local attorney. Omron' Supp. SOF ¶ 70. Omron did not, by s contrast, obstruct discovery or tell any witness what to say to Verve' adversaries. Id. at s 6-8. A reasonable jury simply could not infer from Omron' post-assignment courtesies a s pre-assignment agreement to prosecute frivolous claims. See Fonda v. Gray, 707 F.2d 435, 439 (9th Cir. 1983) (affirming summary judgment where plaintiff did not produce evidence of a "meeting of the minds" to accomplish wrongful purpose). To cover the shortfall, Hypercom accuses Omron of extortion. Hypercom,

according to its Response, "demonstrated" its non-infringement during a settlement
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meeting in Phoenix on September 16, 2004, and "demanded millions of dollars from Hypercom" in settlement ? thus joining Verve' "shake down." Hypercom' Response at s s 10-11. But inadmissibility8 aside, this evidence collapses with Hypercom' own account s of events. In his deposition, Hypercom' in-house counsel, Douglas Reich ("Reich"), s explained: [T]hey may have reserved their evaluation of it, but we clearly demonstrated why we believed they didn' infringe the patents that were at that time being t asserted against us. I am not sure that there was much conversation about the actual infringement because we didn' really go into that t much detail about the claims in the patents. . . . [W]e attempted to go through maybe one or more of the patents, but it became obvious that that was going to be a very lengthy process. And then we got down to more of a discussion about well, how we can resolve this matter between us and Verve. Omron' Supp. SOF ¶ 72. In other words, Hypercom failed to demonstrate to Omron that s it did not infringe the assigned patents. Omron' representative has testified, moreover, s
See Fed. R. Evid. 408 (making offers of compromise inadmissible), and Omron Corporation' Motion To Strike s Evidence Of Compromise (filed contemporaneously with this reply brief).
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that he did not even "know specifically which patent [Verve' claims against Hypercom] s concerned [or] which Hypercom product was involved" at the time of the meeting. Omron' Supp. SOF ¶ 73. In any case, an independent evaluation of Verve' claims s s against Hypercom would have been costly. Omron' Supp. SOF ¶ 74. And Omron had s no contractual or other obligation to assume that expense.9 Nor does the record disclose any Omron demand to settle Verve' claims. Reich, s Hypercom' representative, testified that Omron referred to a "significant number of s patents that Omron had with . . . potential application to Hypercom' business," and s offered a licensing arrangement for those patents. Omron' Supp. SOF ¶ 75 (emphasis s added). The "demand" ? according to Reich ? had nothing to do with pending lawsuits. Rather, Omron allegedly offered to license other patents to Hypercom at market rates. With its allegations of a "shake down," Hypercom adds irony to its rhetorical range. Omron, based on Hypercom' own testimony, did nothing more than refuse to pay s

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Verve' litigation fees and license its patent rights to Hypercom without charge. s Hypercom, by contrast, invited Omron to discuss Verve' lawsuit in Phoenix, lured s Omron with false assurances of privilege, and traded on Omron' cooperation only to sue s Omron for its trouble. Ultimately, it was not Hypercom that was "shaken down." 3. Ministerial Patent Filings Raise No Issue For Trial "Omron signed

Hypercom strays farther from the record when it asserts:

documents for Verve that concealed the true nature of Verve' interest in the Omron s patents, and which concealed the fact that Verve did not have standing to file suit on Omron' patents, so that Omron would not have any risk in case Verve lost any of the s lawsuits." Hypercom' Response at 10. As "evidence" of conspiracy, this claim is s variously flawed.
9

First, the documents were not manufactured for litigation, but

Finally, there was reason to believe Verve' claims legitimate: the International Trade Commission had instituted a s formal investigation of Verve' infringement allegations against Hypercom after completing a 30-day pre-institution s inquiry designed to screen out frivolous complaints. See R.S. Budoff, "A Practitioner' Guide to Section 337 s Litigation Before the International Trade Commission," 17 Law & Pol' Int' Bus. 519, 534 (1985). y l
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specifically contemplated by federal statute. See 35 U.S.C. § 261. And as the ITC itself recognized (in rejecting this very argument), such public notices are "ministerial" filings that need not "lay out the full agreement between the parties." See ITC Order No. 40 at 21, attached as Exhibit 60 to Hypercom' Statement Of Facts.10 Second, an insufficient s assignment could not benefit Omron, as it would deprive Verve of standing to sue. Third, Hypercom' assertion of a fictitious assignment belies (if not renders frivolous) its laters filed declaratory judgment claims against Verve. And in no event could the grant of a "license" rather than assignment ­ even had Omron made one ­ stand in for clear and convincing evidence of an agreement to file frivolous claims. To establish a civil conspiracy, Hypercom must prove that Omron and Verve agreed to commit a tort. After reviewing hundreds of documents and deposing all

principals from Omron and Verve, Hypercom presents nothing more than an arms-length relationship between assignor and assignee. Its claims are baseless. And Omron is
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entitled to judgment as a matter of law. See generally In re Citric Acid Litigation, 191 F.3d 1090, 1104 (9th Cir. 1999) cert. denied, 529 U.S. 1037 (2000) ("evidence as consistent with legitimate behavior as illegal behavior cannot independently support an inference of conspiracy"). III. HYPERCOM CANNOT SUPPORT PROPOSED CLAIMS AGAINST OMRON To revive its failed action, Hypercom now argues that Omron has aided and abetted both abuses of process and malicious prosecutions by Verve (and has moved to add aiding and abetting and malicious prosecution claims to its complaint). See generally Omron' s Response To Hypercom' Motion For Leave To File Second Amended Complaint, filed s contemporaneously with this reply brief on January 12, 2006. These claims, however, fare no better than Hypercom' "conspiracy." s
10

Rather than keep anything secret, Omron voluntarily disclosed the full assignment agreements to all parties in the ITC proceedings when first asked to do so. See generally ITC Order No. 40 at 23, attached as Exhibit 60 to Hypercom' Statement Of Facts. And as the ITC explained, "[t]he existence of the assignment itself is a matter of s public record and constitutes notice of Verve' interest in the ` patent." Id. at 21-22. s 077
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Fatally, Hypercom can identify no evidence of intent. Under Arizona law, claims of aiding and abetting tortious conduct require proof that the defendant knows he is aiding a tort. Wells Fargo Bank, 201 Ariz. at 485, 38 P.3d at 23. To suggest that Omron intentionally aided Verve in abusing process and/or prosecuting frivolous lawsuits, Hypercom recycles its insufficient evidence of conspiracy. Hypercom' Response at 13. s Thus, Hypercom solely offers the Phoenix settlement meeting described above. But for the same reasons it cannot show a conspiracy, a meeting that (1) failed to demonstrate non-infringement, (2) acknowledged the complexity of Verve' patent infringement s claims, and (3) gave Omron no reason to independently analyze its assignee' conduct s could not inform Omron of an on-going tort.11 Elsewhere, the record contradicts Hypercom' aiding and abetting claim. When s asked if Hypercom knows of any evidence that "Omron knew Hypercom was not infringing any of the patents when it assigned those patents to Verve," Hypercom' s

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Rule 30(b)(6) designated witness answered: "I am not aware of such evidence . . . ." Omron' Supp. SOF ¶ 76. And when asked whether a reasonable attorney could have s concluded that Hypercom infringed the assigned patents, Hypercom responded: "I don' t have a basis for saying whether some else could make that conclusion or not." Omron' s Supp. SOF ¶ 77. Nor can Hypercom show evidence of "substantial assistance." Under Arizona law, aiding and abetting requires "substantial assistance" ? that is, assistance that amounts to more than "a little aid." Wells Fargo Bank, 201 Ariz. at 488, 38 P.3d at 26. Here, Omron' only actions after the Phoenix meeting (when it allegedly learned of Verve' s s
11

Compare Wells Fargo Bank, 201 Ariz. at 487-88, 38 P.3d at 25-26 (aiding and abetting evidence sufficient where lender bank knew the developer-borrower was obligated to provide accurate financial information to potential substitute lender, knew information in the developer' financial statements was false, knew the potential lender would s receive those financial statements, and had drafted internal memoranda admitting their falsity and its interest in avoiding disclosure). Further inadequacies of this evidence are addressed in Omron' contemporaneously-filed s Motion To Strike Evidence Of Compromise and Omron' Response To Hypercom' Statement Of Facts And s s Supplemental Statement Of Facts.
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wrongdoing) placed the patent assignee, Verve, in contact with the patented technology inventor, and with a Japanese attorney. This is not evidence that Omron obstructed discovery. And this is not evidence that Omron advanced a frivolous claim.12 Such de minimis, lawful, and indeed ordinary conduct has never passed the "substantial aid" test for aiding and abetting a tort. Compare Wells Fargo Bank, 201 Ariz. at 489-90, 38 P.2d at 27-28 (bank' extraordinary failure to foreclose on loan to delinquent developer, to report s false representations on developer' financial statements, and to disclose fraud during s meeting with new lender raised triable issue). As for Hypercom' proposed claim that Omron engaged in malicious prosecution, s there is simply no evidence that Omron "instigated" any civil proceeding against Hypercom. Compare Bradshaw v. State Farm Mutual Auto. Ins. Co., 758 P.2d 1313, 1319 (Ariz. 1988) (permitting malicious prosecution claim against insurance company that filed suit in insured' name). With or without amendment, Hypercom' complaint s s

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raises no issue for trial. IV. HYPERCOM HAS FULLY DISCOVERED ITS CLAIMS Still hedging, Hypercom asks for additional discovery to oppose Omron' s dispositive motion. Hypercom finds it "generally unfair to force a party to come forward with evidence that is in the hands of its opponent, before discovery on the merits has begun . . . ." Hypercom' Response at 12 (emphasis added). s Specifically, however,

Hypercom has fully discovered information on jurisdictional issues co-extensive with the merits of its case, as its 1500 pages of response exhibits attest. The Court, in fact, has already allowed Hypercom to discover any and all evidence of a "Verve-Omron conspiracy." Omron' SOF ¶ 53. Thus Hypercom has served Omron and Verve with s extensive written discovery, received Omron' complete responses in return, and deposed s
In fact, the ITC proceedings were dismissed on jurisdictional grounds. See Order No. 40 at 21-22, attached as Exhibit 60 to Hypercom' Statement Of Facts. A "merits" witness therefore could not affect those proceedings or s make any malicious prosecution "easier" to occur. Compare Wells Fargo Bank, 201 Ariz. at 489, 38 P.3d at 27 (noting that assistance must make violation "easier" to occur).
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Omron' Rule 30(b)(6) representative on all agreements between Omron and Verve. s Omron' SOF ¶ 55. Hypercom has even deposed the two principals of Verve. Omron' s s SOF ¶ 56. Under Rule 56(f), the party seeking discovery must show that the evidence sought exists, and would bar summary judgment. Byrd v. Guess, 137 F.3d 1126, 1131 (9th Cir. 1998). Hypercom can show neither. To the contrary, nothing has changed since

Hypercom' specific request, the proposed deposition of Omron' counsel, was justifiably s s denied. Hypercom' implied charge that Omron participated in wrongdoing known only s to its outside counsel ­ that Omron committed specific-intent torts without knowing about them ­ is both defamatory and absurd. Hypercom' remaining request, relating to its s theory that Verve is the alter ego of Raymond Galasso, has nothing to do with Omron or its alleged role in a conspiracy. Such requests should not forestall summary judgment on Hypercom' meritless claims. s

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CONCLUSION The chief legal officer and Rule 30(b)(6) designate of Hypercom was asked in his deposition: "So Hypercom doesn' have any specific evidence other than what' in the t s ITC and which you don' actually know about to support the claim that there was an t unwritten agreement," i.e., a conspiracy between Omron and Verve? He answered: "I believe that' correct." Fifteen hundred pages of Response exhibits later, Douglas Reich' s s answer holds true. There is no small paradox in this ­ Hypercom waging a baseless lawsuit against baseless lawsuits. And there is no small cost. Omron has incurred significant expenses to defend this action. Merely to defend its motion for summary judgment, Omron must negotiate feet of irrelevant exhibits, factual license, and hyperbolic rant. Enough is enough. Hypercom has asked the court to "step in and put a stop to the kind of abuse that has occurred here." Omron must concur. ...
PHX/RHARRIS/1751518.1/12623.001

Case 2:04-cv-00400-PGR

- Filed Document 93 13 - 01/12/2006

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FENNEMORE CRAIG, P.C.
P HOENIX

... Respectfully submitted on January 12, 2006. FENNEMORE CRAIG, P.C.

By: s/Ray K. Harris Ray Harris Paul Moore BAKER & DANIELS LLC David P. Irmscher John K. Henning Attorneys for Defendant Omron Corporation

CERTIFICATE OF SERVICE I hereby certify that on January 12, 2006, I electronically transmitted the attached documents to the Clerk' Office using the CM/ECF System for filing and transmittal f a s Notice of Electronic Filing to the following CM/ECF registrants: Michael K. Kelly Sid Leach SNELL & WILMER L.L.P. One Arizona Center 400 East Van Buren Phoenix, AZ 85004-2202 Peter Henry Schelstraete SCHELSTRAETE LAW OFFICE 1949 East Broadway Suite 107 Tempe, AZ 85282-0001 I hereby certify that on January 12, 2006, I served the attached document by mail on the following, who are not registered participants of the CM/ECF System:

PHX/RHARRIS/1751518.1/12623.001

Case 2:04-cv-00400-PGR

- Filed Document 93 14 - 01/12/2006

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FENNEMORE CRAIG, P.C.
P HOENIX

Christopher S. Walton Gregory S. Donahue SIMON GALASSO & FRANTZ PLC 115 Wild Basin Road Suite 107 Austin, TX 78703

_s/Melody Tolliver_________________

PHX/RHARRIS/1751518.1/12623.001

Case 2:04-cv-00400-PGR

- Filed Document 93 15 - 01/12/2006

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