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Grant H. Goodman, State Bar #009463 Grant H. Goodman, PLLC 5110 North 44th Street, Suite L200 Phoenix AZ 85018 Phone: (602) 343-1477 [email protected] Attorney for Plaintiffs IN THE SUPERIOR COURT OF THE STATE OF ARIZONA IN AND FOR THE COUNTY OF MARICOPA GENERAL ELECTRIC CAPITAL CORP., Plaintiff, vs. GRANT H. GOODMAN and TERI GOODMAN, husband and wife, Defendants. ) ) ) ) ) ) ) ) ) ) ) ) ) ) Case No.: CV03-02319 PHX RGS STATEMENT OF FACTS, RULE 52 SUPPLEMENTATION (Oral Argument Requested)
Pursuant to the attached Memorandum of Points and Authorities, defendants hereby attach referenced portions of the Reporter's Transcript of Proceedings in support of their Rule 52 Proposed Findings of Fact and Conclusions of Law. Dated this 13th day of January, 2006. GRANT H. GOODMAN, PLLC
/s/ Grant H. Goodman, #009463 ______ Grant H. Goodman Co-Counsel of Record for Defendants
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MEMORANDUM OF POINTS AND AUTHORITIES Reporters Transcript of Proceedings before the Honorable Roger G. Strand, March 23, 2005: Plaintiff's corporate representative, Lawrence Kovacs, indicates that he has reformulated his damages testimony, that day, for trial purposes in opposition to defendants' objections under Radobenko. Pg. 26, ls. 2-25; pg. 27, ls. 1-25; pg. 28, ls. 125. Mr. Kovacs acknowledges never modifying his prior deposition transcripts or damages testimony prior to trial. Pg. 32, ls. 2-22. Admits damages calculations are entirely different for trial than any information given by him previously. Pg. 33, ls. 13-18. Mr. Kovacs asserts that although previously claiming $1.25 million in damages six months earlier, that he has new calculations today for trial. Pg. 37, ls. 1-25; pg. 38, ls. 111. Mr. Kovacs is incapable of rendering equipment valuations or fair market valuations in any respect. Pg. 39, ls. 1-25; pg. 40, ls. 1-25; pg. 41, ls. 1-25; pg. 42, ls. 125; pg. 43, ls. 1-25. Q: Are you testifying, then, that you really have no basis upon which to inform this Court as to the value of the equipment today under oath. THE WITNESS: Basically I could speak to what the equipment was sold for, and the valuation THE COURT: That's really a yes or no. MR. GOODMAN: Yes, sir. THE WITNESS: I'm sorry, could you repeat that question? (The record was read as follows: Q: Are you testifying, then, that you really have no basis upon which to inform this Court as to the value of the equipment today under oath.) THE WITNESS: I would say no. Relative to marketing of the equipment, Mr. Kovacs has no idea or familiarity with how or if the equipment was ever marketed. Pg. 46, ls. 5-25; pg. 47, ls. 1-22. Mr. Kovacs is asked whether he had any evidence to dispute defendants' expert, Mr. Carmichael, that General Electric had engaged in no marketing in this case and
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states: Q. You have no basis for disputing Mr. Carmichael's position; correct? A. Correct. Pg. 49, ls. 1-11. There were no "comps" conducted in this case. Pg. 50. Mr. Kovacs admitted that he was incapable of rendering a present value calculation at his deposition and then recalculates with a present value for purposes of his trial testimony that day. Pgs. 54-56. The only obligation for the lessee was return of the equipment at expiration of 60 months. Pg. 66, ls. 4-9. Mr. Kovacs admits that there is no residual value payable to the lessor in this case at the expiration of the lease term. Pgs. 66 and 67. Q. So your answer to the question is there is no residual value specified in the contracts between the parties; correct? A. That's correct. Pg. 68, ls. 1-4. Mr. Kovacs, as the corporate representative, was never provided any marketing documents for the equipment at issue. Pg. 72, ls. 17-20. When asked the relevant market in Phoenix, Mr. Kovacs testifies on behalf of the plaintiff that he has "no idea". Pg. 72, ls. 21-25. Mr. Kovacs admits that he "marketed" the equipment to "one and only one entity". Pg. 76, ls. 11-15. Mr. Kovacs admits discounting plaintiff's liquidated valuations by $100,000.00 received just three weeks prior. Pgs. 77 and 78. General Electric admits there was no loss in value to the equipment by misuse or excessive wear and tear. Pgs. 80 and 81. General Electric admits its liquidated damage clause is in the nature of a penalty. Pg. 83. General Electric has no idea whether its damage calculation bears any relationship, whatsoever, to actual damages it has sustained and states it has "no idea." Pgs. 85 and 86.
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General Electric admits that it will provide no evidence at trial relative to its damages. Pgs. 85 and 86. General Electric also acknowledges that at the inception of the contracts it was not eligible to receive liquidated damages. Pg. 89. There were no contractual rights of renewal as admitted to by General Electric. Pg. 92. General Electric admits that it calculated with mathematical precision its rate of return under the contracts at issue and that there was no speculation relative to any return of capital or rate of return on capital since all were calculated in advance by General Electric under Schedule B, Subsection 1, of the Contracts at issue. Pgs. 93, 94 and 95. General Electric indicates it has no basis upon which to contest defendants' equipment valuation at approximately $690,000.00, stating: Q. In fact, you don't have any basis at all to quibble with the $690,000, because you're not a equipment salesman; correct? A. Right, and I haven't heard any expertise or appraisal authority that he has, so that's right. I have no reason to dispute it or agree to it. Pg. 120, ls. 4-9. CONCLUSION Defendants respectfully request the trial court record in this matter and, specifically, the Reporter's Transcript of Proceedings relative to the above testimony incorporated by reference of Lawrence Kovacs, and the related testimony of James Carmichael, appended hereto as Exhibit A, be considered in rendering the Court's final opinions and conclusions of law submitted this date. The Court has also been provided, as Exhibit B appended hereto, General Electric's position relative to liquidated damages clauses under its Third Circuit appellate brief submission relative to In re Montgomery Ward Holding Corp., 326 F.3d 383 (3rd Cir. 2003).
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Dated this 13th day of January, 2006. GRANT H. GOODMAN, PLLC
/s/ Grant H. Goodman, #009463 ______ Grant H. Goodman Co-Counsel of Record for Defendants ORIGINAL electronically filed and copies mailed this 13th day of January, 2006, to: Honorable Roger S. Strand Judge, United States District Court 401 West Washington Street Phoenix AZ 85003 Michael Tsang, Esq. Joseph O'Neil, Jr., Esq. REED SMITH LLP 599 Lexington Avenue New York NY 10022 Attorneys for Plaintiff Renee Gerstman, Esq. RENEE GERSTMAN, PLLC 3550 North Central Avenue Suite 710 Phoenix AZ 85016 Co-Counsel of Record for Defendants
/s/ Grant H. Goodman
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