Free Response to Motion - District Court of Colorado - Colorado

Case 1:00-cv-02325-MSK-MEH

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO Case No. 00-cv-02325-MSK-MEH SIERRA CLUB, and MINERAL POLICY CENTER, Plaintiffs, v. CRIPPLE CREEK & VICTOR GOLD MINING COMPANY, ANGLOGOLD ASHANTI (COLORADO) CORPORATION, ANGLOGOLD ASHANTI NORTH AMERICA, INC., and GOLDEN CYCLE GOLD CORPORATION, Defendants; and Civil Action No. 01-cv-02307-MSK SIERRA CLUB, and MINERAL POLICY CENTER, Plaintiffs, v. CRIPPLE CREEK & VICTOR GOLD MINING COMPANY, ANGLOGOLD ASHANTI (COLORADO) CORPORATION, ANGLOGOLD ASHANTI NORTH AMERICA, INC., and GOLDEN CYCLE GOLD CORPORATION, Defendants. ______________________________________________________________________________ ANGLOGOLD DEFENDANTS' OPPOSITION TO MOTION TO STRIKE DEFENDANTS' EVIDENCE ______________________________________________________________________________

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Defendants Cripple Creek & Victor Gold Mining Company, AngloGold Ashanti (Colorado) Corp., and AngloGold Ashanti North America, Inc. (collectively, the "AngloGold Defendants") hereby oppose Plaintiffs' Motion to Strike Defendants' Evidence Under Fed.R.Evid. 408, Fed.R.Evid. 801, and Fed.R.Civ.P. 68 ("Motion to Strike"). INTRODUCTION Plaintiffs seek to strike Exhibit 1 (a settlement letter from the AngloGold Defendants' counsel) and Exhibit 2 (a settlement letter from the Plaintiffs' counsel) from the AngloGold Defendants' Motion for Attorney Fees [#314]. They also seek to strike from the text of the Motion for Attorney Fees undersigned counsel's three-sentence summary of statements made by Plaintiffs' representatives during a settlement meeting. Plaintiffs argue that such material should be stricken because (1) it is introduced to prove the invalidity of their claims, (2) Rule 68 Offers of Judgment are not admissible to determine fees, or (3) it is hearsay. Motion to Strike at pp. 3-4 [#332]. But none of the statements or letters at issue is offered to prove the invalidity of Plaintiffs' claims. The Court already has ruled that all of Plaintiffs' claims were invalid. The issue now is whether the Defendants should be awarded their fees because the Plaintiffs brought and then continued those claims in bad faith, and the settlement evidence that Plaintiffs now want to strike is probative of just that. Nor is that evidence improper under Rule 68, which specifically permits admission of that evidence in proceedings (as we have here) to determine fees that are defined by the Clean Water Act as a subset of "costs." Finally, undersigned counsel's summary in a pleading of Plaintiffs' statements in a settlement meeting is not hearsay. There is no affidavit or other evidence of those statements before the Court at this stage. Rather,

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counsel has provided a summary of evidence that would be presented at a hearing on the Motion for Attorney Fees, if the Court convenes one. Moreover, if and when presented as evidence, those are statements of party opponents and are not offered for their truth. Consequently, there are no grounds for striking any of the evidence at issue, and the Court should deny the Motion to Strike. ARGUMENT A. Rule 408

As stated in footnote 3 of the Motion for Attorney Fees, the AngloGold Defendants submitted settlement letters and described the positions Plaintiffs took in settlement meetings for one purpose and one purpose only: to show Plaintiffs disregarded the shortcomings of their claims and maintained them in bad faith. Rule 408 does not preclude admission of settlement communications offered for such a purpose. Instead, that rule states that evidence of offering to pay or accept something to settle a disputed claim "is not admissible to prove liability for or invalidity of the claim." (emphasis added.) That means, for example, that if the Plaintiffs here had sent a letter acknowledging liability for attorneys fees and offering to pay some amount of those fees in settlement, that letter would not be admissible to prove that liability or amount. If, by the same token, the AngloGold Defendants had sent a letter to Plaintiffs' counsel after filing the Motion for Fees and in it acknowledged the invalidity of their claim for fees, the Plaintiffs could not now admit that letter to show the fee claim is invalid. But neither of those is the case here. The settlement letters and statements at issue do not acknowledge liability for, or offer to pay an amount of, the AngloGold Defendants' attorney fees. Instead, they reflect what the AngloGold Defendants offered, and what the Plaintiffs were

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willing to accept, to settle the 14 claims comprising Plaintiffs' substantive case. Since the Court already has decided all those claims were invalid, their validity or invalidity is no longer at issue. Plaintiffs argue, nonetheless, that the evidence at issue here "is not probative" (Motion to Strike at 4), and that it also should be stricken under the policy behind Rule 408. But

probativeness is not a grounds for excluding evidence under Rule 408. And the policy behind the rule cannot require excluding evidence that the rule itself allows. Specifically, Rule 408 states that it does not require exclusion of settlement communications offered for "another purpose," as they are here. The two cases Plaintiffs cite themselves support this very point. In Bradbury v. Phillips Petroleum Co., 815 F.2d 1356, 1362-66 (10th Cir. 1987), the Tenth Circuit upheld the District Court's admission of Rule 408 evidence because it was offered for a purpose other than proving validity or invalidity of the claim at issue. In that case, plaintiffs were offering the settlement evidence to demonstrate, inter alia, the petroleum company's continuous course of reckless conduct and disregard of personal and property rights. In Southwest

Nurseries, LLC v. Florists Mutual Insurance, Inc., 266 F. Supp. 2d 1253, 1257-58 (D. Colo. 2003), the District Court excluded settlement evidence because it unquestionably was offered to prove the validity of one of the plaintiff's claims in that case, not (as here) for "another purpose." The issue of admissibility here is not "doubtful." Motion to Strike at 4. Rule 408 allows the Court to consider this evidence on the fees issue, and it should do so. B. Rule 68

Plaintiffs argue that Exhibit 1 (the "Offer of Judgment" letter) is not admissible because Rule 68 only allows admission of such evidence "to determine costs." Id. at 5. This argument misreads Rule 68. That rule states that "[a]n offer not accepted shall be deemed withdrawn and

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evidence thereof is not admissible except in a proceeding to determine costs." Fed. R. Civ. P. 68. Importantly, "the term `costs' in Rule 68 was intended to refer to all costs properly

awardable under the relevant substantive statute. . . . [W]here the underlying statute defines `costs' to include attorney's fees, we are satisfied such fees are to be included as costs for purposes of Rule 68." Marek v. Chesny, 473 U.S. 1, 9 (1985). Here, the CWA defines costs as including attorneys' fees. See 33 U.S.C. § 1365(d) ("[t]he court . . ., may award costs of litigation (including reasonable attorney and expert witness fees"). Accordingly, the Court may properly consider Rule 68 evidence in this fee proceeding. Plaintiffs also suggest that the Offer of Judgment letter may not be admissible because it did not "comport with" the requirements of Rule 68. This argument is immaterial. The

AngloGold Defendants are not using the Offer of Judgment letter as the mechanism for the recovery of costs under Rule 68. Instead, they present the letter as evidence of Plaintiffs bad faith in initiating and continuing their litigation. Accordingly, the admissibility of the Offer of Judgment letter should be judged under Rule 408 and, as set forth above, Rule 408 permits admission. C. Hearsay

Plaintiffs next seek to strike Defendants' "argument" regarding settlement discussions as hearsay. Motion to Strike at 6, Heading C. One of the two "arguments" Plaintiffs want this Court to strike contains no factual statements beyond those in the two exhibits already discussed above. See Motion for Attorney Fees at 13-14; Motion to Strike at 6. The Defendants' second "argument" that Plaintiffs want stricken contains three sentences wherein the undersigned summarizes Plaintiffs' representatives' position at a settlement meeting

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early in the case. See Motion for Attorney Fees at 10-11; Motion to Strike at 6. Those three sentences, however, are not supported at this briefing stage by affidavit or other evidence; therefore, there is no evidence to strike. If the Court conducts a hearing on the Motion for Fees and the AngloGold Defendants seek to present testimony as to statements made by Plaintiffs' representatives at that settlement meeting, the issue Plaintiffs raise now will then be ripe. And if such testimony is offered, it will be admissible non-hearsay (1) because it will consist of the statements of party opponents, and (2) because those statements will not be offered for their truth but only for the fact that they were made and show Plaintiffs' bad faith course of conduct. See F.R.E. 801(c) and (d)(2)(A)-(D). Regardless, until that time there is no evidence to strike. CONCLUSION For the above reasons, the Court should deny the Plaintiffs' Motion to Strike Defendants' Evidence Under Fed.R.Evid. 408, Fed.R.Evid. 801, and Fed.R.Civ.P. 68.

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Respectfully submitted this 6th day of June, 2006. HOGAN & HARTSON L.L.P. s/ Robert C. Troyer __________________________________ Robert C. Troyer 1200 17th Street, Suite 1500 Denver, CO 80202 Telephone: 303-899-7300 Facsimile: 303-899-7333 [email protected] and Eugene J. Riordan Lisa C. Ledet VRANESH AND RAISCH, LLP 1720 14th Street, Suite 200 P.O. Box 871 Boulder, CO 80306-0871 Telephone: 303-443-6151 Facsimile: 303-443-9586 [email protected] [email protected] Attorneys for Defendants Cripple Creek & Victor Gold Mining Company, AngloGold Ashanti (Colorado) Corp., and AngloGold Ashanti North America Inc.

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CERTIFICATE OF SERVICE I hereby certify that on June 6, 2006, I electronically filed the foregoing ANGLOGOLD DEFENDANTS' OPPOSITION TO MOTION TO STRIKE DEFENDANTS' EVIDENCE with the Clerk of the Court using the CM/ECF system which will send notification of such filing to the following e-mail addresses: John M. Barth P.O. Box 409 Hygiene, CO 80533 [email protected] Roger Flynn Jeffrey C. Parsons Western Mining Action Project P.O. Box 349 Lyons, CO 80540 [email protected] Randall M. Weiner Law Offices of Randall M. Weiner, P.C. 1942 Broadway, Suite 408 Boulder, CO 80302 [email protected] Don H. Sherwood Attorney at Law 10861 West 28th Place Denver, CO 80215 [email protected] Craig R. Carver CARVER KIRCHHOFF, SCHWARZ, MCNAB & BAILEY, P.C. 1600 Stout Street, Suite 1700 Denver, CO 80202 [email protected] Eugene J. Riordan Lisa C. Ledet VRANESH & RAISCH, LLP P.O. Box 871 Boulder, CO 80306-0871 [email protected] [email protected] Peter V. O'Connor (via email) AngloGold Ashanti North America Inc. 7400 E. Orchard Road, Suite 350 Greenwood Village, CO 80111

s/ Robert C. Troyer __________________________________ Robert C. Troyer 1200 17th Street, Suite 1500 Denver, CO 80202 Telephone: 303-899-7300 Facsimile: 303-899-7333 [email protected]

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