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MATHEW & MATHEW IVAN K. MATHEW (SBN: 011610) 3300 N. Central Avenue, Suite 1730 Phoenix, Arizona 85012 Tel: (602) 254-8088 / Fax: (602) 254-2204 E-mail: [email protected] Attorneys for Defendants RICKY LEE HANCOCK, BRENDA HANCOCK, RICK HANCOCK HOMES, L.L.C. and RLH DEVELOPMENT, L.L.C. UNITED STATES DISTRICT COURT DISTRICT OF ARIZONA Meritage Homes Corporation, a Maryland Corporation, formerly d/b/a Meritage Corporation, et al. Plaintiffs, v. Ricky Lee Hancock and Brenda Hancock, husband and wife; Rick Hancock Homes L.L.C., RLH Development, L.L.C., Defendants. _________________________________________ Rick and Brenda Hancock, Defendants, Counterclaimants and Third-Party Plaintiffs, v. Meritage Homes Corporation, a Maryland Corporation, formerly d/b/a Meritage Corporation, et al. Third-Party Defendants. (Assigned to the Hon. Roslyn O. Silver) CASE NO. CV-04-0384-PHX-ROS RICK HANCOCK DEFENDANTS' RESPONSE TO PLAINTIFFS' MOTION TO STRIKE and REQUEST FOR LEAVE TO SUPPLEMENT THE RECORD
Rick and Brenda Hancock, Rick Hancock Homes and RLH Development (collectively "Rick Hancock Defendants"), respectfully request the Court to deny the Motion to Strike and grant leave to supplement the record. The Plaintiffs have identified 92 items as subject to a motion to strike. A careful review shows that the Motion to Strike is frivolous, an abuse of the
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opposing party, counsel and the Court. For example, Plaintiff's move to strike from the Response: · Plaintiff's actions are identical to the IntraWest case. In this particular case,
Meritage, the large New York Stock Exchange company, wants to ditch the Hancock Communities name and utilize the Hancock Communities names in only two subdivisions. · Meritage has now come up with "the inadvertent signature theory" after the
proposed counterclaim had been lodged. Defendants have alleged there is a written contract signed by the parties. The Court should accept that there is a contract at this stage. · · Real Estate Regulation R4-28-802 provides that executed contracts must be
provided to buyers and sellers. Actions by Meritage which intended to conceal material facts or alleged are
sufficient to prove a claim. There is no basis to preclude this in a Response. II. RICK HANCOCK'S RESPONSE AND CONTROVERTING STATEMENT OF FACTS 1. Plaintiffs admit that the contract was cancelled.
1
(See Plaintiffs' Motion for
Summary Judgment, p. 8, ll. 3-13.) 2. There has been a diminution in the recognition of the trademark which breached
the License Agreement. Steve Hilton's deposition supports this statement. (See Declaration of Barbara Sorget-Stanton, ¶ 12, Exhibit "21" to CSOF.) 2 Inferences are viewed in a manner most favorable to Rick Hancock. 3. At the Meritage Christmas party in 2003, James Arneson announced to all the
employees that the name Hancock Communities would be changed to Meritage. (Diane Haas stated this in her Declaration, ¶¶ 1-3, Exhibit "7" to CSOF.)
References to CSOF are to CSOF dated February 15, 2007. For ease of the Court, numbers correspond to numbers on Plaintiffs' Motion to Strike, pp. 6 to 18.
2
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4.
After the lawsuit was filed, the names of two subdivisions, Rancho Bella Vista
and The Sundance Subdivision were changed back to include the Hancock name. (Missy Vallirie, Marketing Director of Meritage, testified to this in her deposition testimony, p. 101, ll. 15-20, Exhibit "17" to CSOF.) 5. The names were also diminished in the public media. Barbara Sorget-Stanton
identified in detail the diminution of the name in the media. (See Declaration of Barbara Sorget-Stanton, ¶ 12, Exhibit "21" to CSOF.) 6. An analysis of the Arizona Republic shows a diminution in name recognition.
Barbara Sorget-Stanton detailed this fact in her Declaration. (See Declaration of Barbara Sorget-Stanton, ¶ 12, Exhibit "21" to CSOF.) 7. After the name was dropped, it was resurrected in two neighborhoods. (Missy
Vallirie, Marketing Director of Meritage, testified to this in her deposition testimony, p. 101, ll. 15-20, Exhibit "17" to CSOF.) 8. The purpose of this was to cubbyhole the name, i.e., preclude the Hancocks from
using their name. (Missy Vallirie, Marketing Director, testified to this in her deposition testimony, p. 101, ll. 15-20, Exhibit "17" to CSOF.) 9. Missy Vallirie, the Marketing Director of Meritage, stated under oath, the
explicit purpose of this was to preclude the Hancocks from using their name. (See deposition testimony of Missy Vallirie, p. 101, ll. 15-20, Exhibit "17" to CSOF.) 10. She stated that there was no legitimate marketing reason for use of the name
Hancock Communities, and it was not consistent with the goal of Meritage to go to a national branding campaign. (See deposition testimony of Missy Vallirie, p. 101, ll. 15-20, Exhibit "17" to CSOF.) 11. Missy Vallirie testified that the purpose of using the name was to try to prevent
the Hancocks from using the name. (See deposition testimony of Missy Vallirie, p. 101, ll. 1520, Exhibit "17" to CSOF.)
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12.
Plaintiff's actions are identical to the IntraWest case. In this particular case,
Meritage, the large New York Stock Exchange company, wants to ditch the Hancock Communities name and utilize the Hancock Communities names in only two subdivisions. (Missy Vallirie, Marketing Director, testified to this in her deposition testimony, p. 101, ll. 1520, Exhibit "17" to CSOF.) 13. They informed employees and vendors that they would be changing their name Meritage sent a letter to vendors, employees and potential
from Hancock to Meritage.
customers. (See deposition of Missy Vallirie, p. 102, ll. 11-16, attached as Exhibit "1" to this document.) James Arneson announced this to employees at the Meritage Christmas party. (See Declaration of Diane Haas, ¶ 3, Exhibit "7" to CSOF.) 14. Subsequently, after his deposition, after Ron French realized that the name had
been abandoned, he told Missy Vallirie to use the name Hancock again. This is supported by testimony of Missy Vallirie, p. 127, ll. 2-5, Exhibit "17" to CSOF. Inferences are viewed in a manner most favorable to Rick Hancock. 15. There is an actual contract between the parties which sets out the rights and
obligations of the parties and the trademark--a License Agreement.3 This is supported by deposition testimony of Larry Seay, p. 70, l. 19 through p. 71, l. 24, attached as Exhibit "2" to this document. See also Exhibit "4" to CSOF. 16. The agreement precludes a diminution in the name recognition. This is
supported by the License Agreement itself, Exhibit "4" to CSOF. 17. Barbara Sorget-Stanton, an expert witness, has done a detailed analysis of the
diminution of the name Hancock Communities. This is supported by the Declaration of Barbara Sorget-Stanton, Exhibit "21" to CSOF. Meritage had her report in November 2005. 18. She notes that there has been a "significant" diminution in the Hancock
Communities name recognition. This is supported by the Declaration of Barbara SorgetStanton, ¶¶ 4, 5, 6, 7, 8, 9, 10, 11, Exhibit "21" to CSOF. How this can be questioned is quite frankly bizarre.
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19.
The Hancock Communities name was deleted.
This is supported by the
deposition testimony of Missy Vallirie, p. 119, ll. 5-22, attached as Exhibit "1" to this document. 20. The Hancock Communities were going to be known as Meritage. Then after the
Motion to Dismiss was filed, Meritage sought to use the name in only two locations. Missy Vallirie, Marketing Director of Meritage, testified that the name "Hancock Communities" was dropped by Meritage altogether. Then it was resurrected in only two communities. Then one. Then dropped again. Then resurrected at one community after Ron French's deposition. (See deposition testimony of Missy Vallirie, p. 89, ll. 3-10, attached as Exhibit "1" to this document.) 21. Furthermore, the use of "Hancock Homes" has never been an issue. This is
supported by deposition testimony of Rick Hancock, p. 180, ll. 24-25, Exhibit "18" to CSOF. 22. 23. Meritage has never used the name Hancock Homes. Id. Rick Hancock's use of the name Hancock Family Builder was forged as part of a
potential settlement negotiation with Meritage in 2004. This is supported by deposition testimony of Rick Hancock, p. 179, ll. 1-14, Exhibit "18" to CSOF. 24. However, rather than stick with its commitment, Meritage continues to complain
that Rick Hancock is somehow a bad person for using his family name with a disclaimer, pursuant to dealings between the parties. (See Plaintiffs' Motion for Summary Judgment, p. 8, ll. 14-28.) 25. Contrary to statements of Meritage, at his deposition, Eugene Cole, the expert
witness, stated that Greg Hancock is due monies. This is supported by deposition testimony of Eugene Cole, p. 80, ll. 7-8, Exhibit "22" to CSOF. 26. For some reason, Plaintiffs disregard Greg Hancock's testimony in this case,
perhaps because it is not helpful. There is no reference to Greg Hancock's deposition in this case in Plaintiffs' Motion for Summary Judgment. In any event, there is no basis to strike this from the Response.
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27.
The names Hancock Communities and Hancock Homes are assets of Greg
Hancock. This is supported by the language of the License Agreement, Exhibit "4" to CSOF. 28. The License Agreement provided that there would be no diminution in value or
diminution in name recognition. This is supported by the License Agreement, Exhibit "4" to CSOF. 29. The contract provides that in Greg Hancock's sole discretion he could enforce
the rights under the contract. This is supported by the License Agreement, ¶ 3.6, Exhibit "4" to CSOF. ("[L]icensor in its sole discretion may consider [actions] necessary to protect the license marks.") 30. Every purchaser must acknowledge in writing that he/she understands that Rick See
Hancock Homes is not affiliated with the Meritage or the Hancock Communities.
testimony of Rick Hancock, Exhibit "18" to CSOF. With regard to CSOF 103, see Disclaimer attached as Exhibit "3" to this document; See also testimony of Larry Seay, Exhibit "6", CSOF 56-58. 31. Disclaimers are on marketing materials. This is supported by CSOF 56, 57, and
59. This is supported by the testimony of Larry Seay, Exhibit "6" to CSOF. 32. There is no reason for Meritage's internet address to have the name "Hancock"
in it as it is re-branding the Hancock Community with the Meritage name. Meritage is rebranding the Hancock Communities as part of a national branding campaign. (See deposition testimony of Missy Vallirie, p. 80, ll. 12-17, attached as Exhibit "1" to this document. 33. The name Hancock is the 265th most common last name in the United States.
This should be 546th (www.census.gov/cgi-bin/namesearch.pl). See Exhibit "4" attached to this document. 34. The use of the "Hancock" name in connection with websites is fairly common.
This is supported by CSOF 74, 75, 76, and 77.
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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 129.
35.
The use of a common name such as "Hancock" in the construction industry in
connection with the Internet is important to this Court's analysis. There is no basis to strike this. Rick Hancock is entitled to legal analysis. 36. Meritage, like Cello, cannot claim it has a superior right to the use of a common
name already being used by other people in connection with the home building industry. There is no basis to strike this. Rick Hancock is entitled to legal analysis. 37. Meritage failed to disclose the executed contract. This is supported by CSOF
38.
It was disclosed in early 2006. See testimony of Brenda Hancock, p. 77, ll. 20-
22, attached as Exhibit "5" to this document. 39. The execution of the contract was not "inadvertent." Rick Hancock can show
signature was not inadvertent. This is supported by the Declaration of Greg Hancock, ¶¶ 1213, Exhibit "36" to CSOF. 40. Meritage knew where to locate Rick and Brenda Hancock as he was a former
employee. They did not. This is supported by CSOF 131. Rick Hancock was an employee of Meritage. They were negotiating a severance package at this time with him. They did seek to get a cancellation request signed by him or Brenda Hancock. This is supported by CSOF 138. 41. The signature of Scott Keeffe signified that the contract was accepted. This is
the language of the Madrid contract. This was the understanding of Ron French, President of Plaintiff. (See deposition testimony of Ron French, p. 136, ll. 16-19, attached as Exhibit "6" to this document.) 42. Indeed, Scott Keeffe never canceled the contract. Again, the cancellation
agreement is not signed by Scott Keeffe. 43. The notice of cancellation was back dated. See deposition testimony of Shari
Mesicko, p. 175, ll. 4-22, attached as Exhibit "7" to this document.
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44.
A jury could find that the document was not signed on December 8.
See
deposition testimony of Shari Mesicko, p. 171, l. 6, attached as Exhibit "31" to CSOF. Rick Hancock is entitled to argue that inference should be in his favor. 45. Meritage has now come up with "the inadvertent signature theory" after the
proposed counterclaim had been lodged. Defendants have alleged there is a written contract signed by the parties. The Court should accept that there is a contract at this stage. This is supported by the Declaration of Greg Hancock, ¶¶ 12-13, Exhibit "36" to CSOF. 46. Real Estate Regulation R4-28-802 provides that executed contracts must be This is Defendants' recitation to legal authority in the
provided to buyers and sellers.
Response. There is no basis to strike this. 47. Hancock was told that the contract was not accepted. See deposition testimony
of Steve Hilton, p. 152, ll. 8-19, attached as Exhibit "8" to this document. Testimony of Brenda Hancock, pp. 74-75, Exhibit "34" to CSOF. 48. Actions by Meritage which intended to conceal material facts or alleged are
sufficient to prove a claim. This is not offered as a fact but as a legal analysis in the Response. There is no basis to strike this. 49. Meritage has never used the name "Hancock" alone. This is supported by
deposition testimony of Rick Hancock, p. 180, ll. 24-25, Exhibit "18" to CSOF. 50. Early on in an attempt to avoid litigation, the parties came to an agreement that
Rick Hancock could use the name Rick Hancock Homes. This is supported by reference to CSOF 4. Facts are construed in favor of Rick Hancock. Meritage's claim that it is misleading is not the basis for a Motion to Strike. 51. Eugene Cole stated that there is money due to Greg Hancock. This is supported
by reference to CSOF 5. Facts are construed in favor of Rick Hancock. Meritage's claim that it is misleading is not the basis of a Motion to Strike. 52. The License Agreement allows Greg Hancock, as licensor, to terminate the
License Agreement without notice for a breach of the Agreement. This responds directly to
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Meritage's claim that there is no language in the License Agreement which subjects the License to Greg Hancock's discretion. This is supported by CSOF 6. 53. Rick Hancock did not admit that he discussed the name Rick Hancock Homes
with his brother. This is supported by deposition testimony of Rick Hancock, p. 208, l. 5, attached as Exhibit "9" to this document. Facts are taken in a light most favorable to Rick Hancock. This is clearly a version favorable to Rick Hancock. 54. Rick Hancock wanted to use his name. He wanted to use the name Hancock
which has been around for over 50 years. This is supported by deposition testimony of Rick Hancock, p. 23, l. 14, attached as Exhibit "9" to this document. This was his goal. In addition, Meritage did not buy-out the father, who is also a builder. 55. Missy Vallirie confirmed that the name "Hancock Communities" was no longer
being used in the marketing of Meritage Homes. This is supported by the testimony of Missy Vallirie, p. 89, l. 3 through p. 91, l. 7 attached as Exhibit "1" to this document. Missy Vallirie stated "in my personal opinion, no, I didn't think it was the right thing to do. "In addition, the name Hancock Communities was going to be used at Sundance or Rancho Bella Vista to perpetuate a lawsuit." (See testimony of Missy Vallirie, p. 100, ll. 22-25 through p. 101 ll. 24, attached as Exhibit "1" to this document.) 56. The names are not confusing. There is no likelihood of confusion. Meritage
admits that no consumers have been confused. This is abundantly controverted in detail and with reference to the record by CSOF 10. 57. There is no "Hancock" mark. There is a disclaimer on the billboard and there is
a disclaimer when people come in and want to buy a home. This is abundantly controverted by CSOF 12. In addition, see Disclaimer attached to this document as Exhibit "3". 58. Meritage acknowledges that Rick Hancock has disclaimers on phone recordings
used to receive customer inquiries from the billboard. The alleged contrived phone call by counsel is not by Defendants' counsel, but by Meritage's CFO, Larry Seay.
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59.
"Hancock Homes" has not been used in any marketing efforts by Meritage
Homes. Meritage claimed exclusive use to "Hancock Homes." However, Meritage never used the name Hancock Homes. This is supported by deposition testimony of Rick Hancock, p. 180, ll. 24-25, Exhibit "18" to CSOF. 60. 16--There is no license to use the name "Hancock" alone. "Hancock Homes" is
a federally registered trademark. A blanket statement for ¶¶ 16-19 and 25 is not the basis of a Motion to Strike. Misleading is not a basis for a Motion to Strike. Credibility issues are for the jury. 17--Meritage stopped advertising the Hancock Community mark in 2006. (See testimony of Missy Vallirie, p. 89, ll. 3-10, attached as Exhibit "1" to this document.) 18--Meritage stopped using the Hancock Communities name. Id. 19--Meritage could not use the name Hancock Communities as the license was terminated. (See Plaintiffs' Motion for Summary Judgment, p. 8, ll. 3-13, "The contract was terminated on February 13, 2004.") Second, Meritage did not use the signs near the vicinity of Rick Hancock Homes. (See testimony of Michael Frakes, p. 51, l. 23-25, Exhibit "19" to CSOF.) Plaintiffs' are estopped for arguing otherwise. Missy Vallirie testified that they stopped using Hancock Communities. (See testimony of Missy Vallirie, p. 89, ll. 3-10, attached as Exhibit "1 to this document.) 25--Rick Hancock Homes does not operate in the same subdivision as Meritage. Meritage is on the south side of I-10. Exhibit "19" to CSOF.) 61. The information to secure the release and severance of the Madrid contract is (See testimony of Michael Frakes, p. 51, l. 23-25,
based on representations that the contract was not accepted. (See deposition testimony of Steve Hilton, p. 152, ll. 7-19, and "Exhibit 15" to Steve Hilton's deposition, attached as Exhibit "8" to this document.) 62. The Employee Handbook creates rights for its employees. This is a factual and
legal basis for the Defendants' claim. It is not the proper basis of a Motion to Strike.
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63.
There was an executed contract signed by the Hancocks and Meritage. A review
of the Madrid contract shows that there is the signature of the designated broker, Scott Keeffe, accepting the contract. At this point, facts are construed in a light most favorable to Rick Hancock. A claim something is misleading is inappropriate. Credibility is not weighed at this stage. 64. There was an executed contract signed by the Hancocks and Meritage. Id. At
this point, facts are construed in a light most favorable to Rick Hancock. A claim something is misleading is inappropriate. Credibility is not weighed at this stage. 65. The License Agreement was terminated. Meritage had no rights to the
"Hancock Communities" or "Hancock Homes" name. Meritage in its Motion for Summary Judgment admitted the contract was terminated. (See Plaintiffs' Motion for Summary
Judgment, p. 8, ll. 3-13.) If the License Agreement is terminated, Meritage has no right to use the Hancock name. Rick Hancock is entitled to this inference. 66. The use of one's name is presumed to be in good faith. Anti-Cyber Squatting
Consumer Protection Act. 15 U.S.C. § 1125(d)(1)(B)(II). This fact is presumed by law. In addition, there is reference to testimony of Rick Hancock which controverts Meritage's claim of intent. 67. 27--The use of the divorce deposition cannot be used against Rick Hancock. It
is not admissible evidence. Rick Hancock was not at the divorce deposition. 28--The use of the divorce deposition in this case cannot be used against Rick Hancock. It is not admissible evidence. Greg Hancock testified that he quit because he was forced to quit. Meritage made it intolerable for him to work there. It is not admissible evidence. Rick Hancock was not at the divorce deposition. 68. The License Agreement provides that the license is not transferable. This is
exactly what the License Agreement states. (Exhibit "4", ¶ 2, to CSOF.) Rick Hancock did not misstate the term.
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69.
42--The License Agreement was terminated on February 13, 2004.
This is
exactly what the letter from Titus to Steve Hilton states. (See Plaintiff's Motion for Summary Judgment, p. 8, ll. 3-10.) The facts are viewed in a light most favorable to Rick Hancock. 45--Although the License Agreement has been revoked, the licensee still continues to utilize the Hancock Communities name. Missy Vallirie, Marketing Director of Meritage, testified that the name "Hancock Communities" was dropped by Meritage altogether. Then it was resurrected in only two communities. Then one. Then dropped again. Then resurrected at one community. (See deposition testimony of Missy Vallirie, p. 89, ll. 310, attached as Exhibit "1" to this document.) 106--The letter terminating the License Agreement stated, "Further, in view of your client's repeated breaches of the Master Transaction Agreement, pursuant to Section 7.3 of the License Agreement dated May 30, 2001, your client's license to use the "Licensed Marks," "Hancock Homes" and "Hancock Communities" is hereby terminated immediately." (See letter, Exhibit "16" to Plaintiff's Statement of Facts.) The facts are viewed in a light most favorable to Rick Hancock. 70. On December 2, 2003, when Rick Hancock and his wife were expecting a child,
he was terminated by Steve Hilton, Co-CEO of the Meritage companies. This is supported by testimony of Rick Hancock. (See testimony of Rick Hancock, p. 235, ll. 2-3, attached as Exhibit "9" to this document.) The facts are viewed in a light most favorable to Rick Hancock. 71. Meritage does not want their potential customers in Buckeye, Arizona, which
coincidentally happens to be the place where Rick Hancock wants to build homes, to know that their homes are being built by a large national company. Meritage sought to confuse customers by changing Sundial Community to Hancock Communities. Missy Vallirie,
Marketing Director for Meritage, testified that trying to keep the name made no sense to her. (See testimony of Missy Vallirie, p. 89, l. 12 through p. 90, l. 5, attached as Exhibit "1" to this document.) Again, all inferences are viewed in a light most favorable to Rick Hancock.
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72.
During December 2003, at the Meritage Christmas party, James Arneson, Chief
Executive Officer of the Hancock Communities, announced to all employees that Meritage planned to abandon the use of the Hancock Communities name. The Declaration of Diane Haas, ¶¶ 1-3, Exhibit "7" to CSOF, supports this. 73. 56--The disclaimer states: "Not affiliated with `Meritage Homes/Hancock
Communities.'" This is a fact supported by the testimony of Larry Seay. (See deposition of Larry Seay, pp. 133-134, Exhibit "6" to CSOF.) 57--Meritage acknowledges that Rick Hancock has disclaimers on his billboard. This is a fact supported by the testimony of Larry Seay. (See deposition of Larry Seay, pp. 133-134, Exhibit "6" to CSOF.) 58--Meritage acknowledges that Rick Hancock has disclaimers on phone recordings used to receive customer inquiries from the billboard. This is a fact supported by the testimony of Larry Seay. (See deposition of Larry Seay, p. 134, Exhibit "6" to CSOF.) 74. 81--Meritage conceded the false warranty claims were not really a concern,
because Meritage would never perform warranty work on a home that they did not build. This is a fact supported by the testimony of Larry Seay. (See deposition of Larry Seay, pp. 3536, Exhibit "6" to CSOF.) 82--If Meritage were to get a call from a consumer complaining of a home repair problem, all Meritage need do is say that they did not build the home. This is a fact supported by the testimony of Larry Seay. (See deposition of Larry Seay, pp. 35-36, Exhibit "6" to CSOF.) 87--Meritage admits that no consumers have been confused. This is a fact supported by the testimony of Larry Seay. (See deposition of Larry Seay, p. 37, Exhibit "6" to CSOF.) 88--Meritage admits that no lenders were confused. This is a fact supported by the testimony of Larry Seay. (See deposition of Larry Seay, p. 37, Exhibit "6" to CSOF.)
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89--Meritage admits that no subcontractors were confused.
This is a fact
supported by the testimony of Larry Seay. (See deposition of Larry Seay, pp. 36-37, Exhibit "6" to CSOF.) 93--Title companies know the difference between Hancock Communities and Rick Hancock Homes. This is a fact supported by the testimony of Michael Frakes. (See Declaration of Michael D. Frakes, ¶ 7, Exhibit "13" to CSOF.) 75. On September 8, 2003, Steve Hilton and John Landon agreed that they would
take steps to stop using the Hancock name, three months prior to the termination of the License Agreement. This is supported by the Declaration of Barbara Sorget-Stanton, ¶ 12, Exhibit "21" to CSOF. E-mail is viewed in a light most favorable to Rick Hancock at this stage. 76. After changing all of the communities from Hancock to Meritage, a decision
was made to change back the Eastern most and Western subdivisions back to Hancock. This is supported by testimony of Missy Vallirie, p. 88, ll. 3-10, Exhibit "17" to CSOF. 77. Indeed, it [the disclaimer] is so effective that Meritage has gone out of its way to
hide the disclaimer so that people who were testifying in this case were not shown the disclaimer. This is supported by the testimony of Michael Frakes, pp. 56-57, Exhibit "19" to CSOF. 78. Missy Vallirie testified there was no legitimate marketing reason for this and it
was merely to preclude the Hancocks from using their name. This is exactly what Missy Vallirie, Meritage's Marketing Director, testified to at her deposition. (See deposition of Missy Vallirie, pp. 91, 101, Exhibit "17" to CSOF.) 79. The License Agreement provides that the use of the Hancock names shall not be
diminished in any capacity. This is supported by terms of the License Agreement, ¶ 4, Exhibit "4" to CSOF.
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80.
Steve Hilton also admitted the cessation of the use of the Hancock Communities
name resulted in diminution of the public recognition of the name of Hancock Communities. This is supported by the Deposition of Steve Hilton, p. 70, ll. 15-19, Exhibit "14" to CSOF. 81. 107--Meritage placed numerous full-page newspaper advertisements in the
Arizona Republic which announced the re-branding of Hancock Communities to Meritage. They did so weekly over many weeks. Plaintiffs are correct. There is no reference to record. (See Declaration of Barbara Sorget-Stanton, ¶¶ 8-9, Exhibit "21" to CSOF.) 110--At the deposition of Ronald French, the President of Meritage in Arizona, he admitted that the Hancock Community name had been dropped. Plaintiffs are correct. There is no reference to record. This is also supported by the testimony of Ronald French, p. 189, l. 14-21, attached as Exhibit "6" to this document. 111--Subsequently, after his deposition, after he realized that the name had been abandoned, he started to use the name Hancock again. Plaintiffs are correct. There is no reference to record. This is supported by the deposition testimony of Missy Vallirie, p. 127, ll. 2-5, Exhibit "17" to CSOF and Declaration of Barbara Sorget-Stanton, ¶ 12, Exhibit "21" to CSOF. 113--Purchasers must sign and acknowledge a disclaimer which states "Buyer hereby acknowledges and understands that Seller, Rick Hancock Homes, is not affiliated with Meritage and/or Hancock Communities." (See representative Disclaimer attached as Exhibit "3" to this document.) 115--On December 8, 2004, Greg Hancock terminated the License Agreement thereby precluding Meritage from using the Hancock Communities name. The date should be February 13, 2004. It is supported by CSOF 24. 82. In an attempt to cubby-hole the name, the Hancock name was used in
advertising in the Easternmost subdivision (Rancho Bella Vista) and the Westernmost subdivision (Sundance). (Missy Vallirie, Marketing Director, testified to this in her deposition
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testimony, p. 101, ll. 15-20, Exhibit "17" to CSOF.) Inferences are viewed in a light most favorable to Rick Hancock. 83. One would have to be an "idiot" to not know the difference between Rick
Hancock Homes and Meritage Homes. This is exactly what Michael Frakes told counsel for Meritage at his deposition. (See testimony of Deposition of Michael D. Frakes, p. 49, l. 3, Exhibit "19" to CSOF.) 84. Hancock is using a disclaimer in marketing channels and telephone contacts.
Not only is this supported by testimony of Rick Hancock, Deposition of Rick Hancock, p. 177, ll. 12-19, Exhibit "18" to CSOF, it is acknowledged by Larry Seay, CFO to Meritage (Deposition of Larry Seay, pp. 133-134, Exhibit "6" to CSOF.) 85. Eugene Cole stated that Greg Hancock is owed approximately $2.5 million
dollars. See CSOF 5. 86. Meritage was going to phase out the Hancock Communities name in 18 months.
This is what is in the "go dark" memo. This is in fact what occurred. (See Declaration of Barbara Sorget-Stanton, ¶ 13, Exhibit "21" to CSOF.) This is what was announced at the Meritage Christmas party by James Arneson. CSOF 52. 87. Meritage failed to disclose the executed contract. This is not disputed by
Meritage. (See deposition of John Landon, p. 108, ll. 4-8, Exhibit "23" to CSOF.) 88. The signature of Scott Keeffe signified that the contract was accepted. This is
the language of the Madrid contract. This was the understanding of Ron French, President of Plaintiff. (See deposition testimony of Ron French, p. 136, ll. 16-19, attached as Exhibit "6" to this document.) 89. Roger Zetah requested Scott Keeffe's office to cancel the contract. Mr. Keeffe's
office refused to do so. This is supported by the testimony of Shari Mesicko, p. 170, ll. 7-9, Exhibit "26" to CSOF. All inferences are in favor of Rick Hancock.
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90.
The notice of cancellation was back dated. The notice of cancellation states it
was cancelled on December 8. (See Declaration of Shari Mesicko, ¶ 3, Exhibit "31" to CSOF.) All inferences are in favor of Rick Hancock. 91. The area above Roger Zetah's name contains the designation "Signed this ___
day of ____." This was left blank by Mr. Zetah. A jury could find that the document was not signed on December 8. The document speaks for itself. (See Exhibit "11" to Second
Deposition of Steve Hilton, Exhibit "14" to CSOF.) Finally, all inferences are viewed in a light most favorable to Rick Hancock. 92. The execution of the contract was not inadvertent. Designated brokers do not
inadvertently sign contracts for over $800,000.00 in two different places. (See Declaration of Greg Hancock, dated February 8, 2007, ¶¶ 12-13, Exhibit "36" to CSOF.) As an expert witness, Greg Hancock's opinion need not be based on personal knowledge of Scott Keeffe's intent. CONCLUSION It is respectfully requested that the Motion to Strike be denied and the record be supplemented to include the above information. RESPECTFULLY SUBMITTED this 22nd day of March, 2007. MATHEW & MATHEW, P.C
By: /s/Ivan K. Mathew Ivan K. Mathew, Attorneys for Ricky Lee Hancock, Brenda Hancock, Rick Hancock Homes, L.L.C. and RLH Development, L.L.C.
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18 Case 2:04-cv-00384-ROS Document 460 Filed 03/22/2007 Page 18 of 18
CERTIFICATE OF SERVICE Meritage v. Hancock, et al. Case No. CV 04 00384 ROS
I hereby certify that on March 22, 2007, I electronically transmitted the attached document to the Clerk's Office using the CM/ECF System for filing and transmittal of a Notice of Electronic Filing to the following CM/ECF registrants: Dan W. Goldfine Richard G. Erickson Adam Lang Snell & Wilmer, LLP One Arizona Center 400 E. Van Buren Phoenix, AZ 85004-2202 e-mail: [email protected] Attorneys for Plaintiffs and Counterdefendants and Third Party Defendants Steve Hilton and John Landon Timothy J. Burke Fennemore & Craig, P.C. 3003 N. Central Avenue, Suite 2600 Phoenix, AZ 85012 e-mail: [email protected] Attorneys for Third Party Defendant, Snell & Wilmer, LLP Robert M. Frisbee Frisbee & Bostock 1747 E. Morten Avenue, Suite 108 Phoenix, AZ 85020 e-mail: [email protected] Attorneys for Defendant Gregory Hancock
Grant Woods Grant Woods, P.C. 1726 N. Seventh Street Phoenix, AZ 85006 e-mail: [email protected] Attorneys for Plaintiffs and Counterdefendants and Third Party Defendants Steve Hilton and John Landon
s/Karen Gawel