Free Notice of Filing Proposed Pretrial Order - District Court of Arizona - Arizona

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Sid Leach (#019519) Monica A. Limón-Wynn (#019174) SNELL & WILMER L.L.P. One Arizona Center 400 E. Van Buren Phoenix, AZ 85004-2202 Telephone: (602) 382-6372 Facsimile: 602.382.6070 [email protected] [email protected] Attorneys for Plaintiff Hypercom Corporation Matthew A.C. Zapf (pro hac vice) Colin Wexler (pro hac vice) Chad A. Blumenfield (pro hac vice) GOLDBERG KOHN BELL BLACK ROSENBLOOM and MORITZ, LTD. 55 East Monroe Street, Suite 3300 Chicago, IL 60603-5792 Telephone: 312-201-3914 Facsimile: 312-863-7414 [email protected] [email protected] [email protected] Attorneys for Defendant Omron Corporation David P. Irmscher (15026-02) John K. Henning, IV (25203-49) BAKER & DANIELS LLP 111 East Wayne Street, Suite 800 Fort Wayne, IN 46802 Telephone: 260-424-8000 Facsimile: 260-460-1700 [email protected] [email protected] Attorneys for Defendant Omron Corporation
H. Michael Clyde (009647) PERKINS COIE BROWN & BAIN P.A. 2901 North Central Avenue, Suite 2000 Phoenix, AZ 85012-2788 Telephone: 602.351.8000 Facsimile: 602.648.7000 [email protected] Attorneys for Defendant Omron Corporation

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA Hypercom Corporation, Plaintiff, No. CV 04-0400 PHX PGR JOINT PRETRIAL STATEMENT

Omron Corporation, Defendant. Pursuant to the Scheduling Order entered on November 21, 2005, the parties hereby submit the following Joint Pretrial Statement. A. COUNSEL FOR THE PARTIES. Matthew A.C. Zapf A. Colin Wexler Chad A. Blumenfield GOLDBERG KOHN BELL BLACK ROSENBLOOM & MORTIZ, LTD. 55 E. Monroe Street Chicago, IL 60603 Phone: 312-201-3967 Attorneys for Defendant Omron Corporation
H. Michael Clyde (009647) PERKINS COIE BROWN & BAIN P.A. 2901 North Central Avenue, Suite 2000 Phoenix, AZ 85012-2788 Telephone: 602.351.8000 Facsimile: 602.648.7000 [email protected] Attorneys for Defendant Omron Corporation

Sid Leach Monica A. Limón-Wynn SNELL & WILMER L.L.P. One Arizona Center 400 E. Van Buren Street Phoenix, AZ 85004-2202 Telephone: (602) 382-6372 Attorneys for Plaintiff Hypercom Corporation

David P. Irmscher John K. Henning, IV BAKER & DANIELS 300 N. Meridian Street, Suite 2700 Indianapolis, IN 46204 Phone: 317-237-1317 Attorneys for Defendant Omron Corporation
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B.

STATEMENT OF JURISDICTION This Court has subject matter jurisdiction over this action pursuant to 28 U.S.C.

§ 1332 because Hypercom Corporation's ("Hypercom") claims involve citizens of different states and the amount in controversy exceeds $75,000, exclusive of interest and costs. Because Hypercom's counterclaims are related to the patent infringement claim asserted by Verve and form part of the same case or controversy under Article II of the United States Constitution, this Court may exercise supplemental jurisdiction pursuant to 28 U.S.C. § 1367(a). C. PARTIES REMAINING IN ACTION Plaintiff Hypercom Corporation and Defendant Omron Corporation. D. CLAIMS/CAUSES OF ACTIONS REMAINING IN ACTION 1. 2. 3. E. First Count ­ Civil Conspiracy for Abuse of Process and Malicious Prosecution Second Count ­ Malicious Prosecution Third Count ­ Aiding and Abetting Abuse of Process and Malicious Prosecution

NATURE OF ACTION Plaintiff's Statement In this case, Hypercom seeks to recover from Omron for the damages Hypercom

suffered as a result of the patent infringement proceedings that were brought against it by Verve LLC without probable cause and without first conducting a reasonable pre-filing investigation. Hypercom seeks to recover against Omron because it asserts that Omron conspired with Verve to file the lawsuits against Hypercom, including targeting Hypercom without having performed any investigation establishing whether probable cause existed to bring the claim. Hypercom believes the evidence will show that Omron commonly planned, took part in, or cooperated with Verve in bringing proceedings against Hypercom without probable cause or for the improper purpose of extorting money from Hypercom, or that Omron had control over Verve, ratified and tacitly approved
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Verve's actions. Alternatively, Hypercom believes the evidence will show that Omron was an instigator of the malicious lawsuits filed against Hypercom. Hypercom further asserts that, at the least, Omron aided and abetted Verve. Hypercom believes the evidence will show that Omron had at least a general awareness of Verve's wrongful conduct, and that Omron substantially assisted or encouraged Verve and had an economic motivation to aid Verve. At trial, the jury will decide whether Omron's conduct renders it liable to Hypercom, or whether Omron is vicariously liable for Verve's torts, and if so, the amount of compensable damages. The jury also will be asked to determine whether punitive damages should be awarded against Omron and in favor of Hypercom. Defendant's Statement This is a case arising out of the efforts of Omron Corporation, a Japanese company, to enforce its patent rights against those who were infringing its patents in the United States. Omron lacked the expertise necessary to undertake this effort itself in the United States. Omron eventually entered into an agreement with Verve, a patent licensing

company, to accomplish this goal. Under the arrangement between Omron and Verve, Omron and Verve executed a series of assignment and license agreements under which Omron granted to Verve its rights to several patents, and Verve granted back to Omron non-exclusive licenses to continue using those patents. In general, these types of licensing arrangements are perfectly legitimate, and some of the largest companies in the country have entered into similar arrangements. In this case, however, Hypercom alleges that the specific terms of the arrangement between Omron and Verve was improper. Hypercom seeks to recover from Omron for damages it alleges that it suffered as a result of patent infringement lawsuits that were brought against it by Verve. Hypercom asserts that Omron conspired with, and aided and abetted, Verve in its efforts to file lawsuits against Hypercom. Hypercom alleges that neither Verve nor Omron conducted adequate pre-filing investigations before filing the lawsuits, and accordingly lacked the necessary probable cause to bring the action. Omron was not involved in whatever prefiling investigation Verve performed, and in accordance with the agreements it entered
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into with Verve, did not believe it had any duty to conduct pre-filing investigation beyond that conducted by Verve. Omron was not a named party in any of the suits. F. CONTENTIONS OF HYPERCOM 1. Verve and Omron agreed to accomplish the unlawful purpose of harassing

Hypercom and extracting monetary tribute from Hypercom. As part of this agreement, Omron assigned the patents at issue in this action to allow Verve to initiate its litigation campaign of harassment against Hypercom. 2. The agreement between Verve and Omron regarding the patents at issue in

this case constitutes champerty and is contrary to public policy. 3. Pursuant to the agreement between Verve and Omron, Verve improperly

used the judicial process for the sole purpose of extorting money from Hypercom. This abuse of process is wrongful and it is inconsistent with legitimate litigation goals. 4. These willful, overt acts of Verve and Omron pursuant to their agreement

were improper and illegal. 5. As the proximate result of the actions taken by Verve and Omron pursuant to

their agreement to abuse judicial process, Hypercom suffered damage. 6. Omron acted willfully and wantonly in encouraging and substantially

assisting Verve to bring unfounded patent infringement suits against Hypercom without a having a good faith basis for believing that Hypercom had infringed upon any of the asserted patents. 7. Omron assisted Verve by assigning a number of its patents to Verve to allow

Verve to initiate its litigation campaign of harassment against Hypercom. 8. With Omron's assistance, Verve pursued a scheme designed to unreasonably

and vexatiously multiply the proceedings against Hypercom in order to maximize the harassment value of the meritless litigation. 9. Omron participated in, contributed to, and substantially assisted Verve in the

commission of the tortious conduct described in the preceding paragraphs. 10. Hypercom has suffered damage as a result of the acts of Omron in the aiding
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and abetting of Verve. G. STIPULATIONS AND UNCONTESTED MATERIAL FACTS 1. 2. 3. 4. 5. 6. Plaintiff Hypercom Corporation is an Arizona company. Defendant Omron Corporation is a Japanese Company. Verve LLC ("Verve") is a Texas limited liability company. Raymond Galasso is the founder and 50% owner of Verve. Raymond Galasso is an attorney licensed to practice in the State of Texas. Raymond Galasso is the head of the intellectual property practice at the law

firm of Simon, Galasso & Frantz, PLC (the "SGF law firm"), a Texas law firm. 7. 8. Kevin Imes is a 50% owner of Verve. Kevin Imes is not an attorney but a patent agent, registered to practice before

the U.S. Patent and Trademark Office. 9. On September 11, 2003, Verve filed a complaint in the Eastern District of

Michigan ("Michigan Action") for alleged infringement of U.S. Patent no. 4,678,895 against Verifone, Inc., Lipman USA, Inc., and Hypercom Corporation. 10. On October 10, 2003, Verve filed a first amended complaint in the Michigan

Action, adding as defendants Ingenico Corp. USA, Thales e-Transactions, Inc., Telecheck Services, Inc., Linkpoint International, Inc., and Schlumberger Limited. 11. On October 14, 2003, Omron and Verve entered into an agreement entitled

Patent Assignment Agreement No. 101403. 12. On February 4, 2004, Verve filed a complaint in the Western District of

Texas ("Texas Action") for alleged infringement of U.S. Patent No. 4,562,341 against Hypercom Corporation, Verifone, Inc., Ingenico Corporation USA, Thales e-Transactions, Inc., First Data Corporation, Radiant Systems, Inc., Cybernet USA, Inc., and Mist Inc., USA. 13. On February 25, 2004, Hypercom filed an action in the District of Arizona

against Verve, requesting a declaratory judgment of non-infringement of the `341 Patent and the `895 Patent.
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14.

On March 19, 2004, Omron and Verve entered into an agreement entitled

Patent Assignment and License Agreement No. 031804. 15. On April 1, 2004, Omron and Verve entered into an agreement entitled

Addendum 1-033004 to Patent Assignment and License Agreement No. 031804. 16. On July 31, 2004, Verve filed a complaint in the International Trade

Commission ("ITC Action"), alleging infringement of U.S. Patent No. 5,012,077. 17. On August 30, 2004, Verve filed a Complaint in the Northern District of

California ("California Action") alleging infringement of Patent No. 5,012,077. Michigan Action 18. Mr. Galasso signed the complaint and entered an appearance on behalf of

Verve in the Michigan Action. 19. In May 2004, in response to a motion by Hypercom, the Eastern District of

Michigan severed from the Michigan Action the claims Verve had alleged against Hypercom and transferred them to the District of Arizona. California Action 20. The `077 Patent at issue in the California Action was the same patent at issue

in the ITC Action. The Relationship Between Omron and Verve 21. Omron's intellectual property representative in North America is Mr.

Tetsuyuki Nakano. 22. 23. 24. Mr. Nakano is not a lawyer. Omron's counsel recommended Verve to Omron. Hypercom has deposed the two principals of Verve (Raymond Galasso and

Kevin Imes), a Rule 30(b)(6) corporate representative for Omron (Tetsuyuki Nakano), and Omron's outside counsel.

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H.

CONTESTED ISSUES OF MATERIAL FACT Plaintiff's Issues of Material Fact 1. First Count ­ Civil Conspiracy for Abuse of Process and Malicious

Prosecution a. Did Omron and Verve agree to sue Hypercom for patent infringement in multiple locations without regard to whether or not Hypercom actually infringed any of the Omron patents for the improper purpose of imposing excessive litigation expenses upon Hypercom in an attempt to extort money from Hypercom? b. Did Omron and Verve agree to commit one or more willful acts in the use of judicial process for an ulterior purpose not proper in the regular conduct of the proceedings? c. Did Omron commonly plan, take part in, or cooperate in Verve's wrongful acts? d. e. f. Did Omron engage in acts in furtherance of the conspiracy? Did Omron ratify and/or tacitly approve Verve's actions? Did Omron have control over Verve and/or could Omron have stopped Verve or granted Hypercom a license to end Verve's wrongful litigation? g. h. Did Omron benefit financially from Verve's wrongful acts? Did Omron and Verve act with an evil hand guided by an evil mind (i.e., did their acts rise to the level that would support an award of punitive damages)? 2. Second Count ­ Malicious Prosecution a. Was Omron an instigator of proceedings that Verve filed against Hypercom?
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b. c. d.

Were the proceedings motivated by malice? Were the proceedings begun without probable cause? Were the proceedings terminated in Hypercom's favor? Was Hypercom damaged, and if so, how much? Did Omron and Verve act with an evil hand guided by an evil mind (i.e., did their acts rise to the level that would support an award of punitive damages)?

4 5 6 7 8 9 10 11 12 13 b. 14 acts or conduct? 15 16 17 18 19 20 21 f. 22 (i.e., did their acts rise to the level that would support an award of 23 punitive damages)? 24 25 26 27 28 1. Defendant's Contested Issues of Material Fact Attempting to settle a lawsuit either before a lawsuit is actually filed or while Did Omron and Verve act with an evil hand guided by an evil mind e. d. c. Did Omron substantially assist or encourage Verve in the achievement of the tort(s)? Did Omron know that Verve's conduct constituted a breach of duty and give substantial assistance or encouragement to Verve? Did Omron have an economic motivation to aid in Verve's scheme? Did Omron have at least a general awareness of Verve's wrongful 3. Prosecution a. Did the primary tortfeasor Verve commit a tort (abuse of process or malicious prosecution) that caused injury to Hypercom? e. f.

Third Count ­ Aiding and Abetting Abuse of Process and Malicious

the lawsuit is pending is generally a permissible course of conduct under the law. 2. Filing lawsuits to force a settlement is not impermissible as a matter of law.
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3.

A corporation may be lawfully formed for the purpose of suing other parties

for patent infringement. 4. A corporation can assign its patents to another company for the purpose of

enforcing the patents, including filing lawsuits for patent infringement. 5. A corporation may advise a patent holding company to investigate the

potential infringement of patents assigned by the corporation to the patent holding company. Michigan Action 6. Neither Mr. Kerner nor anyone from Omron signed the complaint or entered

an appearance on behalf of Omron in the Michigan action. 7. In June 2004, one month after Hypercom succeeded in severing and

transferring the Michigan Action to the District of Arizona, Verve voluntarily dismissed the action. California Action 8. On March 8, 2005, Verve voluntarily dismissed the complaint it had filed

against Hypercom in the California Action. Relationship Between Omron and Verve 9. Omron's outside counsel negotiated an assignment agreement with Verve

whereby certain Omron patents were assigned to Verve. 10. The assignment was referred to as a "blanket assignment," meaning that

Omron intended to, and believed it did, assign all rights relating to the patents. The nature of the agreement was that Omron assigned all rights to Verve, and relied upon Verve to conduct itself in an appropriate manner. 11. Omron. 12. The only right Omron retained under the agreement was to review the list of The assignment agreement was drafted by the outside counsels of Verve and

infringers Verve identified in order to make sure that if any were Omron's business partners, Verve would not pursue infringement claims against them.
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13.

Omron entered into the relationship with Verve because it wished to play no

role in the U.S. litigation; it relied on Verve to perform any duties under the agreement, such as performing adequate pre-filing inquiries before filing suit. 14. There were later changes to the agreement between Verve and Omron, but

Omron's intent under each iteration of the agreement was that Verve would have all the rights and responsibilities relating to the patents, while Omron would only receive a license and retain the right to prevent lawsuits against Omron's business partners and customers. Omron did not intend for any subsequent change in the agreement to alter Omron's duties under the agreement. 15. The whole purpose of the assignment agreement was to assign the patents to

a third party (Verve) who would handle all aspects of the litigation process in return for a percentage of the licensing revenues. Under the agreement, Omron had no duty to do any due diligence on any of the infringing companies or to participate in any settlements or lawsuits. 16. The relationship with Verve initially appeared successful, as Verve achieved

several successful settlements from purported patent infringers. 17. Hypercom served Omron (and Verve) with numerous requests for production

and interrogatories, and Omron provided full and timely responses to the discovery requests. 18. Omron produced hundreds of pages of documents, which included

information regarding all then-existing agreements between Omron and Verve. 19. Hypercom is also seeking to hold Omron responsible for Verve's alleged bad

acts--acts in which Omron played no part. Omron is now being sued by a company that is infringing Omron's patents.

Hypercom's Claim Of Conspiracy For Abuse Of Process And Malicious Prosecution
20. Hypercom cannot produce clear and convincing evidence that Omron

reached an actual agreement with Verve, i.e., a "meeting of the minds," in which Verve

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would file and prosecute baseless patent infringement lawsuits and share the proceeds of those baseless lawsuits with Omron. 21. Omron's behavior is perfectly consistent with legitimate competitive

behavior and thus, cannot support an inference of a civil conspiracy to engage in tortious conduct. 22. Hypercom cannot produce any evidence that Omron knew that the lawsuits

filed by Verve lacked any reasonably objective basis. 23. Hypercom cannot produce any evidence demonstrating that Omron had any

role in the selection of targets against which Verve eventually sought to enforce the assigned patents.

Hypercom's Claim Of Malicious Prosecution
24. Hypercom cannot produce any evidence that Omron instituted a single civil

action against Hypercom motivated by malice and without probable cause. Claim Of Aiding And Abetting Abuse Of Process And Malicious Prosecution 25.

Hypercom cannot produce any evidence that Omron formed the specific

intent to aid and abet Verve in prosecuting baseless patent infringement lawsuits. 26. Hypercom cannot produce any evidence that Omron substantially assisted in

the filing and prosecution of baseless patent infringement litigation. Additional Facts 27. Hypercom is not aware of any evidence that Omron knowingly assigned any

patent to Verve, or attempted to assign any patent to Verve, with the knowledge that Hypercom was not infringing it. 28. Hypercom has no evidence of any communications between Verve and

Omron where Omron told Verve that Omron knew Hypercom was not infringing the patents, but that Verve should sue Hypercom anyways. 29. Hypercom is not aware of any evidence that demonstrates that Omron knew

that Hypercom did not have a valid infringement claim against Hypercom, but told Verve to file the lawsuits despite this knowledge.
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30.

Hypercom is not aware of any evidence that Omron knew that Verve did not

have a valid infringement claim against Hypercom but told Verve to go ahead and file the lawsuits anyway. 31. Omron was not a party to the ITC proceeding, and does not have access to

any evidence designated "Confidential" in that proceeding other than that which Hypercom has produced in this matter. 32. During Hypercom's 30(b)(6) deposition, Hypercom refused to provide

information to Omron on numerous topics relating to the ITC Action. 33. Hypercom has no evidence to support its claim that Omron had power to

veto the decision as to where the Michigan lawsuit, or any of the other lawsuits, were going to be filed. 34. Hypercom has no evidence that Omron approved of, or was otherwise

involved in, Verve's decision to dismiss the Michigan action after it was transferred. 35. Omron played no part in designating documents as "Confidential" in the ITC

or preventing documents from the ITC from being produced in the instant matter. 36. Omron has never brought suit against Hypercom directly with respect to any

of the patents at issue in this case. 37. It is neither illegal nor improper for a company who assigns a patent to

another company to approve of the companies that can be sued for infringement of that patent. 38. Hypercom contends that there are unwritten agreements between Omron and

Verve that support Hypercom's allegations of a conspiracy between Omron and Verve, but Hypercom refused to tell Omron during discovery about any evidence it has to support its belief of the existence of unwritten agreements. 39. investigation. 40. Hypercom cannot prove that Omron acted with an evil mind that would

Hypercom cannot prove that Verve failed to conduct an adequate pre-filng

justify the imposition of punitive damages.
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41.

Hypercom cannot produce any evidence that Omron abused any legal

process after each of the patent infringement lawsuits was filed by Verve. 42. There is no evidence that the lawsuits filed and prosecuted by Verve were so

objectively and subjectively baseless that no reasonable litigant could reasonably have expected success on the merits. I. CONTESTED ISSUES OF LAW Plaintiff's Contested Issues of Law 1. Prosecution a. Did Omron and Verve engage in a civil conspiracy to commit an underlying tort? Yes. Under Arizona law, "there is an action for damages caused by acts committed pursuant to a conspiracy." Estate of Hernandez v. Flavio, 930 P.2d 1309, 1313 (Ariz. 1997). "For a civil conspiracy to occur two or more people must agree to accomplish a lawful objective with unlawful means, causing damages." Wells Fargo Bank v. Arizona Laborers, Teamsters, & Cement Masons Local No. 395 Pension Trust Fund, 38 P.3d 12, 36 (Ariz. 2002). "[L]iability for civil conspiracy requires that two or more individuals agree and thereupon accomplish an `underlying tort which the alleged conspirators agreed to commit.'" Id. Based upon the evidence expected at trial, the jury may find that Omron commonly planned, took part in, or cooperated in Verve's wrongful acts; that Omron engaged in acts in furtherance of the conspiracy; that Omron ratified and/or tacitly approved Verve's actions; that Omron had control over Verve and could have stopped Verve or granted Hypercom a license to end Verve's wrongful litigation; and that Omron benefited financially from Verve's wrongful acts. Hypercom believes the circumstantial evidence will support a finding that First Count ­ Civil Conspiracy for Abuse of Process and Malicious

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Omron and Verve agreed to accomplish the underlying torts of malicious prosecution, abuse of process, and champerty. b. Do the facts meet the standard required for an award of punitive damages? Yes. Punitive damages may be recovered upon proof, either direct or

6 circumstantial, that Omron acted with an evil mind. This required state of 7 mind may be shown by any of the following: (1) Intent to cause injury; (2) 8 Wrongful conduct motivated by spite or ill will; or (3) Omron and Verve 9 consciously pursued a course of conduct knowing that it created a 10 substantial risk of significant harm to others. The required evil mind may be 11 established by a defendants' express statements or inferred from a 12 defendants' expressions, conduct or objectives. 13 inferred when a defendant deliberately continued his actions despite the 14 inevitable or highly probable harm that would follow, or where a defendant 15 continues a course of conduct with knowledge of the past harm caused by 16 that conduct. Bradshaw v. State Farm Mutual Automobile Ins. Co., 758 17 P.2d 1313, 1324, 1326 (Ariz. 1988) ("Punitive damages may be assessed 18 even though the injury to the individual plaintiff was `relatively small and 19 innocuous,' so long as the cumulative harm suffered by all victims, 20 plaintiffs and non-plaintiffs, is significantly large or `tremendous.'"); 21 Thompson v. Better-Bilt Aluminum Products Co., Inc., 171 Ariz. 550, 832 22 P.2d 203 (1992) (plaintiff's burden of proof that defendant acted with the 23 requisite evil mind can be proved through circumstantial evidence from 24 which the jury can draw inferences, including "defendant's expressions, 25 conduct or objectives," if a "defendant deliberately continued his action 26 despite the inevitable or highly probable harm that would follow," or if a 27 defendant "continues a course of conduct with knowledge of the past harm 28
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An evil mind may be

1 2 3 4 5 6 2.

caused by that conduct"); Hawkins v. Allstate Ins. Co., 152 Ariz. 490, 733 P.2d 1073 (1987). Second Count ­ Malicious Prosecution a. Is Omron liable for Verve's acts of malicious prosecution against Hypercom? Yes. Omron can be held liable for malicious prosecution as an instigator of

7 the wrongful civil actions, even if Omron was not a party to the civil actions 8 that gave rise to the malicious prosecution claim. Bradshaw v. State Farm 9 Mutual Automobile Ins. Co., 758 P.2d 1313, 1319 (Ariz. 1988). Hypercom 10 believes the evidence at trial will show that Omron was an instigator of the 11 proceedings filed against Hypercom, was aware of the malicious lawsuits, 12 and provided cooperation and assistance to Verve. 13 14 15 16 17 18 19 20 21 22 23 24 Yes. In Arizona, "a person who aids and abets a tortfeasor is himself liable 25 for the resulting harm to a third person." Wells Fargo Bank v. Arizona 26 Laborers, Teamsters, & Cement Masons Local No. 395 Pension Trust Fund, 27 38 P.3d 12, 23 (Ariz. 2002). A claim of aiding and abetting tortious conduct 28
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b.

Do the facts meet the standard required for an award of punitive damages?

Yes. Omron acted with the requisite "evil mind." This required state of mind may be shown by any of the following: (1) Intent to cause injury; (2) Wrongful conduct motivated by spite or ill will; or (3) Omron and Verve consciously pursued a course of conduct knowing that it created a substantial risk of significant harm to others. 3. Prosecution a. Did Omron aid and abet a tortfeasor? Third Count ­ Aiding and Abetting Abuse of Process and Malicious

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is made where (1) the primary tortfeasor commits a tort that causes injury to the plaintiff, (2) the defendant has at least a general awareness of the primary tortfeasor's tortious conduct, and (3) the defendant substantially assists or encourages the primary tortfeasor in the achievement of the tort. Id. at 23-26. Hypercom believes the evidence at trial will show that Omron knew that Verve's patent infringement claims were baseless and provided Verve with substantial assistance in connection with Verve's scheme. b. Do the facts meet the standard required for an award of punitive damages? Yes. Omron acted with the requisite "evil mind." This required state of

11 mind may be shown by any of the following: (1) Intent to cause injury; (2) 12 Wrongful conduct motivated by spite or ill will; or (3) Omron and Verve 13 consciously pursued a course of conduct knowing that it created a 14 substantial risk of significant harm to others. 15 16 17 18 19 20 21 22 23 24 25 26 27 28 later filed by the assignee. Indeed, the assignor no longer owns the patents and has no rights to sue for infringement. In addition, Omron cannot be held liable as an "instigator" under Bradshaw v. State Farm Mut. Auto. Ins. Co., 157 Ariz. 411, 417, 758 P.2d 1313,
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Defendant's Contested Issues of Law 1. Whether Omron had any duty to conduct a pre-filing investigation

into the validity of patent infringement claims filed in various lawsuits by the party to which those underlying patents were assigned, even though Omron has filed no claims against Hypercom? No. Omron assigned its patents to Verve, a patent holding company, as permitted under the federal patent laws. The law imposes no duty on the assignor of patents to conduct pre-filing investigations into the validity of patents infringement claims

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1319 (1988), because Omron did not play any decision-making role in the filing or prosecution of the patent infringement claims filed by Verve. 2. Whether Omron may be held liable for malicious prosecution as an

instigator under Bradshaw v. State Farm Mut. Auto. Ins. Co., 157 Ariz. 411, 417, 758 P.2d 1313, 1319 (1988)? No. Omron did not play any decision-making role in the filing or

prosecution of the patent infringement claims filed by Verve. Bradshaw is entirely distinguishable and inapplicable to this case. 3. Whether the assignor of a patent can be held liable for the

misconduct of the assignee after the patents have been assigned? No, there is no legal precedent for holding the assignor of a patent liable for the misconduct of the assignee. Nor should there be any such liability. Once the patents have been assigned, the assignee owns the patents, and no court has imposed vicarious liability on an assignor for the conduct of an assignee. 4. Whether the assignment of a patent creates any duty on the assignor

to police the conduct of the patent assignee? No, there is no legal duty on the assignor to police the conduct of the assignee. Again, the assignee owns the patents, and the assignor cannot be held

responsible for the assignee's conduct in enforcing the assignee's intellectual property rights. There is no legal precedent for such a duty. 5. Whether the contractual provisions in the Assignment Agreements

giving Omron the right to approve licensing targets provides any basis for Omron to "veto" lawsuits against entities that are not business partners? No. The language of the Assignment Agreements is clear and unambiguous, and there is no contractual provision that would allow, much less permit, Omron to veto lawsuits against entities that are not business partners. Rather, the Assignment

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Agreements left Omron with only a limited right to curtail Verve's assertion of the patents. Specifically, Omron's right to grant sub-licenses to customers and clients amounts to nothing more than an ability to shield business partners from infringement claims. Omron could not terminate any suit against a non-business partner like Hypercom. 6. Whether the Noerr-Pennington doctrine immunizes Omron from

liability for lawsuits filed and prosecuted by Verve? Yes. Verve (and thus Omron) is entitled to immunity for maintaining civil suits under the Noerr-Pennington doctrine. Noerr-Pennington protects the First

Amendment right to petition ­ "'among the most precious of the liberties safeguarded by the Bill of Rights. . . .'" White v. Lee, 227 F.3d 1214, 1231 (9th Cir. 2000) (quoting United Mine Workers of America, Dist. 12 v. Illinois State Bar Ass'n, 389 U.S. 217, 222 (1967)). It insulates parties who bring civil litigation from liability "so long as the litigation is not a 'sham.'" Matsushita Electronics Corp. v. Loral Corp., 974 F. Supp. 345, 355 (S.D.N.Y. 1997), citing Professional Real Estate Investors, Inc. v. Columbia Pictures Inds., Inc., 508 U.S. 49, 60-61 (1993). Litigation is a "sham," moreover, only if both objectively and subjectively baseless. Hypercom cannot show that Verve (much less Omron) engaged in sham litigation in federal court or before the ITC. 7. Whether federal patent law preempts state law tort claims based on

bad faith misconduct in federal administrative proceedings? Yes, patent law preempts state law claims based on bad faith misconduct in federal administrative proceedings. Abbott Laboratories v. Brennan, 952 F.2d 1346, 1355 (Fed. Cir. 1992), cert. denied, 505 U.S. 1205 (1992); Competitive Technologies v. Fujitsu Ltd., 286 F. Supp. 2d 1118, 1155 (N.D. Cal. 2003). 8. Whether federal patent law preempts state law tort claims based on

misconduct in federal court actions? Yes. The same rationale providing for preemption of state actions based on misconduct in administrative proceedings provides for preemption of state actions based

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on federal infringement suits. Hypercom, therefore, has impermissibly asked the Court to apply state law standards to conduct exclusively controlled by federal law. 9. Whether Hypercom is entitled to produce any evidence of damages

despite failing to produce any expert witness evidence supporting the reasonableness of attorneys' fees and to produce during discovery any evidence on damages? No. Hypercom is not entitled to produce any evidence of damages because they failed to produce any evidence of damages during discovery (despite specific requests for such information from Omorn), and because Hypercom failed to present expert witness testimony that the attorneys' fees claimed as damages were reasonable. 10. Whether Hypercom can present evidence of settlement negotiations

between Omron and Hypercom during the settlement conference on September 16, 2004? No, because Rule 408 of the Federal Rules of Evidence precludes any party from using evidence of compromise to prove liability or the validity of a claim. In this case, Hypercom lured Omron to a settlement conference under false pretenses and now purports to use statements made by Omron during this conference to prove its claims. This is not permissible under Rule 408. 11. Whether Hypercom can relitigate its claims against Omron, despite

an opportunity to litigate those same claims before another Arizona court and jury? No. Hypercom strategically dismissed its claims against Verve in this case, and re-filed those allegations as counterclaims in another case against Verve pending before Judge Martone. See Hypercom Corp. v. Verve, L.L.C., Case No. CV-05-0365PHX-FJM. The reason for Hypercom's decision to split the defendants apart is clear Hypercom wanted two different opportunities to try its case against Omron and Verve. Now that Hypercom has already tried its case against Verve, Hypercom wants to relitigate those same issues in this Court and try to better the result. However, the principles of collateral estoppel and judicial efficiency set forth in Bridgestone/Firestone North America Tire, L.L.C. v. Naranjo, 206 Ariz. 447, 79 P.2d 1206 (Ariz. App. 2003), dictate that Hypercom should not be permitted to re-litigate any issues already decided by another
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Arizona judge and jury. In addition, the doctrine of merger precludes Hypercom from relitigating claims that should have been joined in the first trial against Verve. 12. Whether Hypercom should be permitted to introduce any evidence

related to punitive damages? No, because Hypercom cannot make a prima facie case, with clear and convincing evidence, that Omron acted with an evil mind, much less that Omron had knowledge that the lawsuits filed by Verve were baseless. 13. Whether Hypercom should be permitted to introduce evidence of

actions and conduct by the parties after the lawsuits were filed by Verve? No. Hypercom has consistently maintained throughout this litigation that the only relevant time period is the time prior to the filing of each lawsuit commenced by Verve against Hypercom, and that any information or evidence learned by Omron after those lawsuits were filed is irrelevant. Thus, evidence of conduct and actions after the lawsuits were filed should not be admissible. 14. Whether there is a reasonable claim that Hypercom's point-of-sale

terminals infringe U.S. Patent Nos. 5,012,077, 4,678,895, or 4,562,341? Yes. Contrary to the opinions of Hypercom's expert witness, Lawrence Pretty, there is ample evidence that many of Hypercom's point of sale terminals infringe the patents assigned by Omron to Verve. Omron's expert witnesses, Brad Gulko and Charles Berman, will testify that the T8 and ICE6000 terminals infringe U.S. Patent No. 5,012,077, the T7 terminal infringes U.S. Patent No. 4,678,895, and the ICE6000 terminal infringes U.S. Patent No. 4,562,341. 15. Whether Hypercom should be permitted to proceed with its claims

against Omron related to the administrative proceedings before the ITC? No. Collateral estoppel also bars Hypercom from relitigating its claims related to the administrative proceedings in the International Trade Commission. The District Court in the Hypercom/Verve lawsuit also issued final judgments on Hypercom's claims related to the ITC Administrative Action, dismissing those claims on summary
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judgment. Hypercom should not be permitted to pursue those same claims against Omron in a different court. J. WITNESSES. Plaintiff's Witnesses 1. Doug Reich (Fact Witness) c/o Snell & Wilmer, L.L.P. 400 E. Van Buren Street One Arizona Center Phoenix, AZ 85004-2202 The witness is not outside the Court's

This witness will be called at trial. subpoena power.

Mr. Reich has been Hypercom's general counsel throughout the relevant time period that the malicious lawsuits were filed. Mr. Reich is expected to testify about the malicious lawsuits filed against Hypercom and facts concerning abuse of process. He is expected to testify about a telephone call between Verve's attorney and Hypercom's representatives, a meeting with representatives of Omron, and circumstantial evidence of aiding and abetting, conspiracy, lack of probable cause, and malice. He is also expected to testify concerning Hypercom's damages. As general counsel for Hypercom, he

reviewed and approved the payment of costs and expenses incurred by Hypercom as a result of the torts of malicious prosecution and abuse of process. Mr. Reich testified at the Verve trial before Judge Martone, and his testimony at trial will include the same subject matter covered at the Verve trial. Omron's attorney attended the entire trial before Judge Martone, and should be aware of the substance of Mr. Reich's testimony at the Verve trial. 2. Robert D. Martin (Fact Witness) c/o Snell & Wilmer, L.L.P. 400 E. Van Buren Street One Arizona Center Phoenix, AZ 85004-2202

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This witness will be called at trial. subpoena power.

This witness is not outside the Court's

Mr. Martin is an employee of Hypercom. He is expected to testify about the Hypercom products accused of infringement and lack of probable cause. 3. Mohammad Arif (Fact Witness) c/o Snell & Wilmer, L.L.P. 400 E. Van Buren Street One Arizona Center Phoenix, AZ 85004-2202 This witness is not outside the Court's

This witness will be called at trial. subpoena power.

Mr. Arif is an employee of Hypercom.

He is expected to testify about the

Hypercom products accused of infringement and lack of probable cause. 4. Laurence Pretty (Expert Witness) c/o Snell & Wilmer, L.L.P. One Arizona Center 400 E. Van Buren Street Phoenix, AZ 85004-2202

This witness will be called at trial. This witness is outside the Court's subpoena power. Because this witness is outside the Court's subpoena power, this witness was contacted and will voluntarily agree to testify. The substance of Mr. Pretty's expert testimony is set forth in his expert report. Mr. Pretty testified at the Verve trial before Judge Martone, and his testimony at trial will include the same subject matter covered at the Verve trial. Omron's attorney attended the entire trial before Judge Martone, and should be aware of the substance of Mr. Pretty's testimony at the Verve trial. 5. Raymond Galasso c/o Michael S. Quinn Quinn Hayes & Quinn 2630 Exposition Blvd. Suite G-10 Austin, Texas 78703

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This witness may be called at trial if he will agree to appear voluntarily. This witness is outside the Court's subpoena power. Because this witness is outside the Court's subpoena power, this witness has been contacted and it is believed that he will voluntarily agree to testify. If the witness does not voluntarily testify, excerpts from his deposition will be introduced at trial instead. Mr. Galasso is expected to testify that Omron was an instigator of the malicious lawsuits filed against Hypercom. Mr. Galasso is expected to testify that Omron aided and abetted Verve's malicious prosecution and abuse of process. Mr. Galasso is expected to testify about the acts of malicious prosecution and abuse of process, and Omron's knowledge and participation in the scheme. 6. Chris Alexander c/o Snell & Wilmer, L.L.P. One Arizona Center 400 E. Van Buren Street Phoenix, AZ 85004-2202

This witness will be called at trial. This witness is outside the Court's subpoena power. Because this witness is outside the Court's subpoena power, this witness was contacted and will voluntarily agree to testify. Mr. Alexander was President of Hypercom when the lawsuits were filed against the company. Mr. Alexander is expected to testify about the malicious lawsuits filed against Hypercom and facts concerning abuse of process. He is also expected to testify concerning Hypercom's damages. Mr. Alexander testified at the Verve trial before Judge Martone, and his testimony at trial will include the same subject matter covered at the Verve trial. Omron's attorney attended the entire trial before Judge Martone, and should be aware of the substance of Mr. Alexander's testimony at the Verve trial.

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7.

George Wallner c/o Snell & Wilmer, L.L.P. One Arizona Center 400 E. Van Buren Street Phoenix, AZ 85004-2202

This witness may be called at trial. This witness is outside the Court's subpoena power. Because this witness is outside the Court's subpoena power, this witness has been contacted and it is believed that he will voluntarily agree to testify. Mr. Wallner is expected to testify about the history of Hypercom and its dealings with Omron, including Hypercom's use of Omron to construct POS terminals based on Hypercom's designs. Mr. Wallner's testimony will include circumstantial evidence of Omron's knowledge that Hypercom's accused products did not in fact infringe any of the Omron patents asserted against Hypercom. Defendant's Witnesses 1. Tetsuyuki Nakano Omron Corporation c/o Baker and Daniels LLP 111 East Wayne Street, Suite 800 Fort Wayne, IN 46802 Phone: (260) 424-8000 Fax: (260) 460-1700 Mr. Nakano is a fact witness and will be called to testify at trial. Mr. Nakano is outside of the Court's subpoena power. He has been contacted and he will voluntarily agree to appear at trial and testify. Mr. Nakano is the Executive Director for Omron Corporation's North American Intellectual Property office. Mr. Nakano will testify regarding the assignment agreements and Omron's actions with respect to the agreement with Verve L.L.C. ("Verve"), and Verve's litigation. 2. Herbert Kerner Baker & Daniels LLP 805 15th Street, N.W., Suite 700 Washington, D.C. 20005 Phone: (202) 312-7440 Fax: (202) 312-7460 Mr. Kerner is a fact witness and will be called to testify at trial. Mr. Kerner is outside of the Court's subpoena power. He has been contacted and will voluntarily agree to appear at trial and testify. Mr. Kerner is an attorney with the law firm of Baker & Daniels LLP, and he represented Omron
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Corporation during its negotiation of numerous assignment agreements with Verve. Mr. Kerner will testify regarding the contractual terms of the assignment agreements, his negotiations and communications with Verve, and the extent of Omron's involvement in the patent infringement lawsuits filed by Verve. James Dunlop TAEUS Engineering Intellectual Property 101 North Cascade Avenue, Suite 400 Colorado Springs, Colorado 80903 Phone: (719) 632-8441 Fax: (719) 632-5715 Mr. Dunlop is a fact witness for Omron Corporation, and may be called to testify at trial. He is outside of the Court's subpoena power. He has been contacted and he will voluntarily agree to appear at trial and testify. Mr. Dunlop made observations of the functions of the Hypercom ICE6000 terminal at PetCo, a pet retail store located at 1650 East Cheyenne Mountain Boulevard, Colorado Springs, Colorado. His observations are discussed in his Patent Analysis Report. Charles Berman (Expert Witness) Greenberg Traurig, LLP 2450 Colorado Avenue, Suite 400E Santa Monica, CA 90404 Mr. Berman is an expert witness for Omron Corporation, and may be called to testify at trial. He is outside of the Court's subpoena power. He has been contacted and he will voluntarily agree to appear at trial and testify. He will testify consistent with the opinions set forth in his written expert report and his deposition testimony. Brad Gulko (Expert Witness) Lepton Incorporated 3020 Bridgeway, Suite 144 Sausalito, CA 94965 Mr. Gulko is an expert witness for Omron Corporation, and may be called to testify at trial. He is outside of the Court's subpoena power. He has been contacted and he will voluntarily agree to appear at trial and testify. He will testify consistent with the opinions set forth in his written expert report and his deposition testimony.

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6.

Raymond Galasso Verve L.L.C. 8127 Mesa Drive, #B-206-67 Austin, TX 78759 Mr. Galasso is a fact witness and he may be called to testify at trial. He is outside of the Court's subpoena power. Omron is in the process of contacting Mr. Galasso to see if he will voluntarily appear at trial and testify. Mr. Galasso is a principal of Verve, a patent holding company. Mr. Galasso negotiated on behalf of Verve the assignment of numerous Omronowned patents to Verve under several assignment agreements, and he has information regarding Verve's activities including the pretrial investigation of the patent infringement actions filed in each lawsuit.

7.

Kevin Imes Verve L.L.C. 8127 Mesa Drive, #B-206-67 Austin, TX 78759 Mr. Imes is a fact witness and he may be called to testify. He is outside of the Court's subpoena power. Omron is in the process of contacting him to see if he will voluntarily appear at trial and testify. Mr. Imes is a principal of Verve, a patent holding company. Mr. Imes negotiated on behalf of Verve the assignment of numerous Omron-owned patents to Verve under several assignment agreements, and has information regarding Verve's activities including the pretrial investigation of the patent infringement actions filed in each lawsuit.

8.

Douglas J. Reich General Counsel Hypercom Corporation c/o Snell & Wilmer L.L.P. One Arizona Center 400 E. Van Buren Phoenix, AZ 85004-2202 Phone: (602) 382-6372 Fax: (602) 382-6070 Mr. Reich is a fact witness and may be called to testify at trial. Mr. Reich is within the Court's subpoena power. Mr. Reich is general counsel for Hypercom and has knowledge regarding Hypercom's claims of conspiracy against Omron and Verve. Mr. Reich has knowledge regarding the absence of any factual support for Hypercom's allegations against Omron.

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9.

Chris Walton 6300 Bridepoint Parkway, Bldg. One Suite 410-A Austin, TX 78730 Phone: (512) 231-1311 Mr. Walton is a fact witness and may be called to testify. He is outside of the Court's subpoena power. Omron is in the process of contacting him to see if he will voluntarily appear at trial and testify. Mr. Walton represented Verve during the patent infringement lawsuits filed in the Michigan, Arizona, Texas, California and ITC Actions. Mr. Walton has information regarding Verve's activities and the pre-filing investigation of the patent infringement actions filed in each lawsuit.

LIST OF EXHIBITS AND DEPOSITION DESIGNATIONS. 1. Plaintiff's Exhibits Objections Irrelevant; Lacks foundation; Hearsay; Inadmissible evidence of ITC Administrative Action, per Omron MIL No. 8; Authentication issue (FRE 901) Irrelevant; Lacks foundation; Hearsay; Inadmissible evidence of ITC Administrative Action, per Omron MIL No. 8; Authentication issue (FRE 901)

Description of Exhibits Specifications of claims for patent application for publication date September 12, 1986 (Japanese) and English translation dated December 29, 2004 (ITCOMRON00142-00148)

Letter dated May 10, 1990 re Amendment and Response to Office Action re patent application (Japanese) (ITC-OMRON00060-00077)

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Ex. No. 3

Description of Exhibits Response from Kenji Ushiku dated October 26, 1990 (Japanese) and English (ITC-OMRON00040-00043)

Objections Irrelevant; Lacks foundation; Hearsay; Inadmissible evidence of ITC Administrative Action, per Omron MIL No. 8; Authentication issue (FRE 901) Irrelevant; Lacks foundation; Hearsay; Inadmissible evidence of ITC Administrative Action, per Omron MIL No. 8; Authentication issue (FRE 901) Irrelevant; Lacks foundation; Hearsay; Inadmissible evidence of ITC Administrative Action, per Omron MIL No. 8; Authentication issue (FRE 901) No objection

4

Letter dated November 26, 1990 to Kenji Ushika re Formal Notice of Allowance (Japanese) and Letter in English (ITC-OMRON00027-00032)

5

Office Action from Japanese Patent Office that application should be denied for certain reasons sent July 27, 1993 (Japanese) (ITC-OMRON00140-00141) and English translation, plus References A, B, and C from Office Action

6

Point-Of-Sale Portfolio Assessment and Market Analysis (OMRON00649-00678)

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Ex. No. 7

Description of Exhibits

Objections

Letter from Herbert Kerner to Raymond Galasso dated No objection August 18, 2003 enclosing Patent Assignment Agreement Between Omron Corporation and Verve LLC executed by Omron Corporation (OMRON00429), and Patent Assignment Agreement Between Omron Corporation and Verve (Agreement No. 081303) re Patents 4,630,200 and 4,678,895 entered into on August 15, 2003 and signed only by Omron Corporation on August 13, 2003 (OMRON00430-00435) Email between Herbert V. Kerner and Raymond M. Galasso dated September 5, 2003 re targeting filing suit for one patent next week but have not received copy from Omron of the executed recordable assignment documents (OMRON00333-00351) Lack of Foundation; Hearsay; Authentication issue (FRE 901)

8

9

One-Page Patent Assignment between Omron No objection Corporation and Verve LLC re U.S. Patent Nos. 4,6380,200 and 4,678,895 dated September 5, 2003 and recorded with the U.S. Patent Office on September 8, 2003 (H000108) Verve LLC's Complaint against Hypercom Corporation et al filed in the United States District Court, Eastern District of Michigan, as Civil Action No. 03-73481 dated September 11, 2003 (H000524544) Verve LLC's Civil Cover Sheet for No. 03-73481 dated September 11, 2003 and signed by Raymond Galasso (H000546) No objection

10

11

No objection

12

Letter from Raymond M. Galasso to Christopher Lack of foundation; Alexander of Hypercom Corporation dated September Hearsay 15, 2003 re Notice of Suit filed against Hypercom for infringement of U.S. Patent No. 4,678,895 (H000495) Verve LLC's First Amended Complaint for No. 0373481 dated October 10, 2003 (H000550-571) No objection

13 14

Patent Assignment and License Agreement Between No objection Omron Corporation and Verve, L.L.C. Agreement No. 101403 signed by Tetsuyuki Nakano on October 14, 2003 and by Raymond M. Galasso on October 14, 2003 (OMRON00184-00188)

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Ex. No. 15

Description of Exhibits One-Page Patent Assignment between Omron Corporation and Verve LLC re U.S. Patent No. 4,5462,341 signed by Tetsuyuki Nakano and dated October 14, 2003 and recorded with the U.S. Patent Office (H000085) Letter from Raymond M. Galasso to David Caplan, counsel for Hypercom Corporation dated October 16, 2003 re Notice of Suit filed against Hypercom for infringement of U.S. Patent No. 4,678,895 and 4,562,340 (H000496) Hypercom Corporation's Motion to Transfer filed in the Eastern District of Michigan No. 03-73481 dated March 2, 2004

Objections No objection

16

No objection

17

Inadmissible evidence of post-filing conduct, per Omron MIL No. 7; Confusing, misleading and prejudicial No objection

18

Patent Assignment and License Agreement Between Omron Corporation and Verve, LLC entered as of March 19, 2004 (No. 031804) signed by Tetsuyuki Nakano on March 19, 2004, and by Raymond M. Galasso on March 17, 2004, plus Appendices A-F (OMRON00161-00190) Addendum 1-033004 to Patent Assignment and License Agreement No. 031804 between Omron Corporation and Verve, LLC, dated April 1, 2004 signed by Tetsuyuki Nakano on April 2, 2004 and signed by Raymond Galasso on May 5, 2004 (OMRON00191-00192)

19

No objection

20

Email from Raymond Galasso to Herbert V. Kerner No objection dated April 13, 2004 re "additional targets for Omron's consideration" (OMRON00395) One-Page Patent Assignment between Omron Corporation and Verve LLC re U.S. Patent No. 5,012,077 signed by Tetsuyuki Nakano and dated April 26, 2004 and recorded with the U.S. Patent Office (H000128) No objection

21

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Ex. No. 22

Description of Exhibits Opinion and Order of the Eastern District of Michigan severing claims against Hypercom Corporation and transferring claims to District of Arizona dated May 11, 2004 (LP007208-7220)

Objections Irrelevant to proving claims; Inadmissible evidence of post-filing conduct, per Omron MIL No. 7; Confusing, misleading and prejudicial No objection

23

Verve LLC's Notice of Dismissal of Hypercom Corporation for action transferred from Eastern District of Michigan to District of Arizona pending as CIV04-01030-PHX-JAT dated June 6, 2004 (H000607-609) Omron Memorandum from T. Nakano dated August 2003 (Japanese) (OMRON00537) plus English Translation dated March 4, 2005 (4 pages)

24

Hearsay; Authentication issue (FRE 901); Lack of foundation; Confusing, misleading and prejudicial; Irrelevant Hearsay; Authentication issue (FRE 901); Lack of foundation; Confusing, misleading and prejudicial; Irrelevant Hearsay; Authentication issue (FRE 901); Lack of foundation; Confusing, misleading and prejudicial; Irrelevant No objection

25

Omron Memorandum from T. Nakano dated October 2003 (Japanese) (OMRON538) plus English translation dated March 4, 2005 (4 pages)

26

Omron Memorandum from T. Nakano dated March 2004 (English and Japanese) (OMRON00536) plus English translation dated March 4, 2005 (4 pages)

27

Email from Raymond Galasso to Herbert V. Kerner dated October 28, 2003 re NCR (OMRON0037000371)
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Ex. No. 28

Description of Exhibits

Objections

Email from Herbert V. Kerner to Raymond M. Galasso No objection dated December 13, 2003 re Proposal (OMRON00383-00384) Email from Raymond Galasso to Herbert V. Kerner dated December 17, 2003 and attached draft proposal between Verve and Omron (OMRON00383-384) Email from Raymond Galasso to Herbert V. Kerner dated January 28, 2004 re Verve/Omron Proceeds to date (OMRON00648) No objection

29

30

Lack of foundation; Hearsay

31

Email from Raymond Galasso to Herbert V. Kerner re Irrelevant; responding to request for status update on suits filed Inadmissible evidence of (VER001824) post-filing conduct, per Omron MIL No. 7; Lack of foundation; Hearsay; Inadmissible evidence of ITC Administrative Action, per Omron MIL No. 8; Authentication issue (FRE 901); (partial document)

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Ex. No. 32

Description of Exhibits Email from Raymond Galasso to Herbert V. Kerner dated March 11, 2004 re subject: Draft Referral Fee Letter (VER001825) plus draft (VER001526-00158)

Objections Irrelevant; Inadmissible evidence of post-filing conduct, per Omron MIL No. 7; Confusing and misleading, per Omron MIL No. 12; Confusing, misleading and prejudicial; Lack of foundation; Hearsay Inadmissible evidence of ITC Administrative Action, per Omron MIL No. 8; Authentication issue (FRE 901) Irrelevant to proving claims; Inadmissible evidence of post-filing conduct, per Omron MIL No. 7; Confusing and misleading, per Omron MIL No. 12; Confusing, misleading and prejudicial; Lack of foundation; Hearsay

33

Email from Raymond Galasso to Herbert V. Kerner dated March 24, 2004 re subject: Copy of Executed Omron Referral Letter attached PDF (VER001817001822)

34

Letter from Verve signed by Raymond Galasso dated Irrelevant; March 19, 2004 to DTK Technologies, LLC re referral Inadmissible evidence of fee and three appendices (OMRON00470-00475) post-filing conduct, per Omron MIL No. 7; Confusing and misleading, per Omron MIL No. 12

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Ex. No. 35

Description of Exhibits Letter from Herbert V. Kerner to Raymond Galasso dated April 23, 2004 re "Clearance of Licensing Targets for Omron Patents" (OMRON00317-00318)

Objections Confusing and misleading; Lack of foundation; Hearsay

36

Letter from Herbert V. Kerner to Raymond Galasso Confusing and "Updated" dated April 23, 2004 re "Clearance of misleading; Licensing Targets for Omron Patents (OMRON00463Lack of foundation; 00464) Hearsay Email from Kevin Imes to Raymond Galasso dated June 1, 2004 re Delphion results (VER001792001796) Irrelevant; Confusing, misleading and prejudicial; Improper Character Evidence; Lack of foundation; Hearsay; Inadmissible evidence of ITC Administrative Action, per Omron MIL No. 8; Authentication issue (FRE 901) No objection

37

38

Email from Herbert V. Kerner to Raymond Galasso dated June 24, 2004 re "waiting to get an action list of patents to assign" (OMRON00408-00409)

39

Email from Raymond M. Galasso to Herbert V. Kerner No objection dated July 1, 2004 re 957 Patent targets (OMRON00420-00421) Email from Herbert V. Kerner to Raymond Galasso dated July 2, 2004 re "Status of Target Review" (OMRON00422-00423) Confusing and misleading; Lack of foundation; Hearsay

40

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Ex. No. 41

Description of Exhibits Email from Herbert V. Kerner to Tetsuyuki Nakano dated July 20, 2004 re Raymond Galasso's email needing information before filing ITC Action (OMRON00307-00308)

Objections Irrelevant; Confusing and misleading; Lack of foundation; Hearsay Confusing and misleading; Lack of foundation; Hearsay Lack of foundation; Hearsay Lack of foundation; Hearsay; Authentication issue (FRE 901) Irrelevant to proving claims; Inadmissible evidence of post-filing conduct, per Omron MIL No. 7; Inadmissible evidence of compromise negotiations, overly prejudicial, confusing and misleading, per Omron MIL No. 2

42

Email from Herbert V. Kerner to Raymond Galasso dated July 20, 2004 re subject: Status of Target Review (OMRON00309-00311)

43

Email from Herbert V. Kerner to Tetsuyuki Nakano dated September 2, 2004 re: ITC Release (OMRON00298-00299) Email from Herbert V. Kerner to Tetsuyuki Nakano dated September 7, 2004 re accounting of MIST settlement (OMRON00296-00297)

44

45

Email from Sid Leach to Herbert V. Kerner dated September 8, 2004 re subject: Meeting ­ Omron & Hypercom (3 pages) (OMRON00293-00295)

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Ex. No. 46

Description of Exhibits Email from Herbert V. Kerner to Sid Leach dated September 13, 2004 re subject: Meeting ­ Omron & Hypercom and attaching Non-Disclosure Agreement draft (OMRON00285-00290)

Objections Irrelevant; Inadmissible evidence of post-filing conduct, per Omron MIL No. 7; Inadmissible evidence of compromise negotiations, overly prejudicial, confusing and misleading, per Omron MIL No. 2; Lack of foundation; Hearsay

47

PowerPoint Slides entitled Hypercom/Omron Meeting Irrelevant; Phoenix, AZ September 16, 2004 (13 pages) Lacks foundation; (H000068-80) Inadmissible evidence of post-filing conduct, per Omron MIL No. 7; Inadmissible evidence of compromise negotiations, overly prejudicial, confusing and misleading, per Omron MIL No. 2; Hearsay

Case 2:04-cv-00400-PGR

- 37 Document 189 -

Filed 04/26/2007

Page 37 of 99

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Ex. No. 48

Description of Exhibits Email from Raymond Galasso to Herbert V. Kerner dated October 1, 2004 re wiring money to Omron (OMRON00272-00274)

Objections Irrelevant; Inadmissible evidence of post-filing conduct, per Omron MIL No. 7; Confusing and misleading; Authentication issue (FRE 901); Lack of foundation; Hearsay

49

Email from Herbert V. Kerner to Raymond Galasso re Irrelevant; no withholding requirement and to remit 100% of Inadmissible evidence of proceeds (OMRON00275) post-filing conduct, per Omron MIL No. 7; Confusing and misleading; Lack of foundation; Hearsay Email from Herbert V. Kerner to Raymond M. Galasso Irrele