Free Declaration - District Court of Arizona - Arizona

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Joel L. Herz, Esq. State Bar No. 015105 Law Offices of Joel L. Herz 3573 East Sunrise Drive, Suite 215 Tucson, AZ 85718 Telephone: 520-529-8080 Facsimile: 520-529-8077 Attorneys for Defendant GTFM, LLC UNITED STATES DISTRICT COURT DISTRICT OF ARIZONA MEADOWLARK LEMON, et al., Plaintiffs vs. HARLEM GLOBETROTTERS INTERNATIONAL, INC., et al., Defendants ) ) ) ) ) ) ) ) ) )

Case No. CV 04-0299 PHX-DGC Case No. CV 04-1023-PHX-DGC

DECLARATION OF IRA S. SACKS IN SUPPORT OF DEFENDANTS' OPPOSITION TO PLAINTIFFS' JOINT MOTION FOR PRE-ADMISSION OF EXHIBITS AND EVIDENCE

IRA S. SACKS declares as follows under penalty of perjury pursuant to 28 U.S.C. § 1746: 1. I am a partner in the firm of Dreier LLP, attorneys for defendant

GTFM, LLC ("GTFM" or "FUBU"). I submit this declaration in support of Defendants' Opposition to Plaintiffs' Joint Motion for Pre-admission of Exhibits and Evidence ("Plaintiffs' Pre-Admission Motion").

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2.

Other than as expressly indicated below, the matters set forth herein

are based on my personal knowledge. 3. On October 30, 2006, Defendants received a new expert report from

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Plaintiffs, increasing Plaintiffs' alleged damages from under $2 million to over $12 million and increasing the number of alleged infringing styles from nine to nearly 80, in violation of several court orders. 4. On November 1, 2006, Defendants received a further new expert

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report from Plaintiffs, adding alleged damages of $92,000 for sales by someone other than Defendants in Japan, and correcting the October 30 numbers, adding another $1 million in alleged damages. 5. On November 2, 2006, Plaintiffs attempted to enter these expert

reports ("Plaintiffs' Exhibit H" or "Exhibit H") ­ which violate at least three of this Court's Orders and come 13 months after the close of discovery and over 14 months after Plaintiffs' expert disclosures were due ­ into evidence as summaries pursuant to FRE 1006. This should not be permitted. 6. Plaintiffs' Exhibit H is not a summary and should not be admitted

into evidence as substantive evidence or as a pedagogical exhibit. To the contrary, Exhibit H is an expert report, made up of complicated calculations ­ even more complicated than those contained in Plaintiffs' precluded expert report (the "Abalos Report"). These calculations are based on unsupported assumptions, interpretations of

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styles, in some cases rely on inadmissible evidence, fail to fairly represent the underlying documents, and are irrelevant.
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7.

In addition to being expert reports and a violation of several of this

Court's prior orders, on their face, without more, the dozens of charts comprising Exhibit H are irrelevant and therefore inadmissible.

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8.

For the charts to be admitted, there must be testimony at trial that the

charts are relevant. Not only does that bar "pre-admission", but there will be no such evidence at trial. There is no evidence that consumers purchased the FUBU/HGI Apparel as a result of Plaintiffs' names on the apparel. There is no evidence that consumers identified Plaintiffs' alleged jersey numbers or the caricatures on the FUBU/HGI Apparel with Plaintiffs, or purchased the FUBU/HGI Apparel as a result of the use of the numbers or

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caricatures. There is no evidence as to the number of garments within a style that contained the "Legends" hangtag and no evidence that any consumer purchased the FUBU/HGI Apparel with the Legends hangtag as a result of

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the hangtags and not as a result of other factors, such as the FUBU and Harlem Globetrotters trademarks or the garment's quality, color or price. Without such proof, the charts comprising Exhibit H are irrelevant, because all of the charts assume that the styles at issue were purchased because they contained names, numbers, caricatures or some portion of them had Legends hangtags. 9. The Japanese Chart in Exhibit H fails to accurately represent the

underlying data and would be misleading to the jury. Moreover, Mr. Phipps fails to
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explain where the numbers in the Japanese report come from or how he calculated his results. 10. The seven "C" charts are not summaries. Rather they are charts

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which involve a selection of styles by Mr. Phipps and inaccurate calculations regarding those styles. There is no explanation for why Mr. Phipps assumed that consumers purchased those styles because of anything to do with Plaintiffs. 11. Moreover, many of the Plaintiffs' "C" charts include data that is

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incorrect and grossly overstated, perhaps intentionally so. Many of the styles set forth in the "C" charts are women's styles. Each "C" chart calculates alleged damages "by dividing total sales by number of players that appear on garment." However, even if Mr. Phipps' assumptions were valid ­ which they are not ­ that calculation overstates GTFM's revenues by 6.66 times. As Plaintiffs are well aware, the women's sales were by Jordache, a licensee of GTFM. GTFM received a royalty of 15% of Jordache sales, a point recognized by Ms. Abalos in her report, and not the sales revenues. Thus, Mr. Phipps is overestimating Plaintiffs damages in the "C" charts and not summarizing voluminous documents. 12. Charts "D1" and "D2" for each Plaintiff in Exhibit H are not a

summary of anything. These charts include a selection of styles by Mr. Phipps without basis in the record, divide the sales in those styles by nine, and then allocate the resulting alleged damages among all Plaintiffs, all of which has to be attempted to be explained by

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a witness at trial. The styles selected by Mr Phipps supposedly include styles which used some of the Plaintiffs' names on a list of "Legends" that was used on some garments and
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some hangtags, as a part of (or as an incidental attachment to) the garments. 13. There is no evidence that the hangtags were used as a marketing

device. Plaintiffs' repeated citation to the testimony of FUBU representative and FUBU
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Bates #1242 and 1244 for that position mischaracterizes the underlying evidence. 14. The seven Charts "E" and "F" of Exhibit H are not summaries.

Chart "E" appears to be styles that Mr. Phipps forgot to include in his Phipps I Analysis (the Sales Chart). Many of those calculations are wrong because they reflect volumes of

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women's sales, instead of the royalty received by GTFM. Additionally, Chart "E" is irrelevant because there is no explanation of record as to why Mr. Phipps chose the styles that are on the charts. Moreover, there has been no testimony as to whether consumers purchased these styles because they have a Plaintiffs' name or alleged number on them. 15. Chart "F" is not a summary and seems to contain the same general

information as Charts "D1" and "D2". There is no explanation as to why Mr. Phipps listed these particular styles, where Mr. Phipps got the numbers for the calculations (which are wrong as to all of the women's styles), and there has been no showing of relevance because Plaintiffs have offered no evidence to show that any sales were made as a result of Plaintiffs' names, alleged numbers and/or caricatures on the jerseys and/or the hangtags. 16. When discussing the "F" Charts in Plaintiffs' Pre-Admission

Motion, Plaintiffs assert that "[t]hese are styles that were extracted from FUBU
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documents (Ex. A) some of which were produced later after the original charts were prepared." See Plaintiffs' Pre-Admission Motion, pg. 9. This is incorrect. All of the
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FUBU documents were produced prior to the first time Plaintiffs produced the Sales Chart to FUBU. FUBU produced all of its documents before the discovery cutoff on September 30, 2005. Moreover, documents for many of the styles set forth in the "F"

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charts were produced as early January 7 and February 4, 2005. The first time the Sales Chart was produced to Defendants was with the summary judgment motions in November 2005. 17. Exhibit H also fails under FRE 1006 because all of the underlying

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evidence was not made available to Defendants. Specifically, Defendants have never had the opportunity to evaluate the garments for authenticity. 18. The only times Defendants were able to view the garments were at

the Phipps Deposition and at the meeting to exchange documents on October 31, 2006, neither of which were sufficient to evaluate the authenticity of the garments. 19. Although Plaintiffs have attached an email string to their motion

where GTFM's counsel requested the garments and offered to preserve the chain of custody between Morgan & Morgan and Dreier LLP, counsel for the Neal Plaintiffs never sent the garments to GTFM as requested. Thus, GTFM has had no opportunity to verify that the underlying garments on which Mr. Phipps bases his assumptions are even authentic. Moreover, Defendants did not even know that there was a damage issue with respect to the garments until October 31, 2006 when Plaintiffs received the Phipps II Analysis.

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20.

Additionally, Plaintiffs falsely state in their motion that "Defendants

not only reviewed Plaintiffs' charts on February 16, 2005, but wrote back on April 8,
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2005..." Plaintiffs' Pre-Admission Motion, pg. 5. Defendants were not even aware of the Sales Chart until November 2005, when Plaintiffs produced the documents in connection with the summary judgment motions. The charts Plaintiffs refer to only

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included sales for eight styles and did not have any information regarding Plaintiff Lemon. Moreover, the charts that were sent were represented to be attorney work product, and were not submitted with an affidavit from Mr. Phipps, precluding Defendants from questioning Mr. Phipps about the charts in his deposition. Plaintiffs did

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not submit an affidavit from Mr. Phipps in connection with the charts until two months after his deposition. I declare under penalty of perjury that the foregoing is true and correct. Dated: New York, New York November 16, 2006 /s/ Ira S. Sacks Ira S. Sacks

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