Free Statement - District Court of Arizona - Arizona

EXHIBIT 31
Case 2:04-cv—00400—PGR Document 85-28 Filed 12/23/2005 Page 1 of 3

(U
l I UNITED STATES INTERNATIONAL TRADE COMMISSION
. Washington, D.C.
I l Before Robert L. Barton, Jr.
‘ Administrative Law Judge
Inthe Matter of I g
CERTAIN POINT SALE Inv. No. 337-TA-524 -
TERMINALS AND COMPONENTS U I
THEREOF _
DECLARATION OF DOUGLAS REICH
I I, Douglas Reich, declare as follows:
1. I am. the General Counsel, Chief Compliance Officer and Corporate Secretary of
Hypercom Corporation ("Hypercom"), and have served in that capacity since October 2001. I
~ have personal knowledge of the facts stated in this declaration unless stated otherwise.
2. The complainant in this investigation, Verve L.L.C. ("Verve"), does not
A l manufacture or sell POS terminals, and to the best of my knowledge, does not make or sell any
A products. Verve is organized and operated for the sole purpose of filing lawsuits on patents and l
attempting to collect money from third parties against whom the patents are asserted. l
3. Verve’s complaint to the International Trade Commission in this investigation is l
one of four different proceedings Verve has initiated against Hypercom. On September 11,
‘ 2003, Verve sued Hypercom in the United States District Court for the Eastern District of
Michigan, CIV Action No. 03-73481, alleging infringement of United States Patent Noi.
4,678,895. Upon Hypercom’s motion, the court transferred that case to the United States District
Court for the District of Arizona. Verve responded by dismissing the case when it arrived in
rv Arizona where Hypercom is located. On February 4, 2004, Verve sued Hypercom in the United
A Case 2:-04-cv—00400—PGR Document 85-28 _ Filed 12/23/2005 Page 2 of 3

(
) States District Court for the Westem District of Texas, CIV Action No. 04-CA—O62 LY, alleging
l infringement of United States Patent No. 4,562,341. Upon Hypercom.’s motion, the court
transferred that case to the United States District Court for the District of Arizona. Verve was
unable to unilaterally dismiss that case because Hypercom had already filed an answer to the
l ‘ complaint. On August 30, 2004, shortly after tiling its complaint here, Verve sued Hypercom in
the United States District Court for the Northem District of Califomia, Case No. 5:04-CV-03659,
alleging infringement of United States Patent No. 5,012,077 5 the patent at issue in this
A litigation. After our counsel wrote to Verve threatening to file a Rule ll motion, the California
case was dismissed by Verve. l
V i 4. On November 17, 2003, after the first case was filed against Hypercom in ·
Michigan, I participated in a telephone call mth Raymond Galasso of Verve to discuss what Mr.
" . Galasso wanted Hypercom to pay him as a "settlement." Mr. Galasso raised the subject of .
A payment of money to stop Verve from filing lawsuits against Hypercom. He stated that Verve
would "keep suing until you pay us," which I understood to mean that Verve would continue to -
file patent infringement suits against Hypercom, regardless of their merits, in an effort to extort a .
payoff from Hypercom. A
_ ‘ _ I declare under penaltyof perjury that _the foregoing is true and correct. A
_ DATED this l2"` day of May, 2005. g A
l · T AS,/'
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EXHIBIT 31

Case 2:04-cv-00400-PGR

Document 85-28

Filed 12/23/2005

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Case 2:04-cv-00400-PGR

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