Free Response to Motion - District Court of Colorado - Colorado

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO Hon. Marcia S. Krieger Civil Action No. 04-MK-1225 (BNB) (consolidated with 04-MK-1226 (BNB)) MALIK M. HASAN, M.D., an individual; and SEEME G. HASAN, an individual, Plaintiffs, v. GOLDMAN SACHS 1998 EXCHANGE PLACE FUND, L.P., a Delaware limited partnership; GOLDMAN SACHS 1999 EXCHANGE PLACE FUND, L.P., a Delaware limited partnership; GOLDMAN SACHS MANAGEMENT PARTNERS, L.P., a Delaware limited partnership; GOLDMAN SACHS MANAGEMENT, INC., a Delaware corporation; THE GOLDMAN SACHS GROUP, INC., a Delaware corporation; GOLDMAN, SACHS & CO., a New York limited partnership; JOHN DOES 1-100, individual persons whose true identities are unknown; and LENDER PARTIES 1-100, business entities whose true identities are unknown, Defendants.

RESPONSE IN OPPOSITION TO "THE NAMED DEFENDANTS' MOTION FOR PRECLUSION AND OTHER RELIEF"

Plaintiffs, Malik M. Hasan and Seeme G. Hasan (collectively, the "Hasans"), through their undersigned counsel, Senn · Visciano · Kirschenbaum · Merrick P.C., respectfully respond in opposition to THE NAMED DEFENDANTS' MOTION FOR PRECLUSION AND OTHER RELIEF filed on about October 18, 2005 (the "Named Defendants' Motion"). As is shown here, the allegations

contained in the Named Defendants' Motion are false and/or materially misleading. The Named Defendants' Motion was carefully planned and timed--

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an obvious litigation gambit designed to: (i) preoccupy the Hasans, and their counsel, in an effort to render them unprepared for the hearing conducted before this Court on November 9-10, 2005, and (ii) impugn the integrity of Dr. Hasan on the eve of the hearing. Moreover, as is demonstrated in the corresponding

MOTION FOR SANCTIONS to be filed shortly, the Named Defendants' Motion is designed to conceal serious litigation misconduct by the Goldman Sachs Defendants that warrants appropriate and stern sanctions by this Court.

I.

The Framework for the Named Defendants' Motion The issue before this Court at the hearing on November 9-10, 2005

was whether the Hasans had entered into binding and enforceable agreements to arbitrate the litigation claims that have been asserted in this Court. The

Goldman Sachs Defendants urge that the Hasans' agreements to arbitrate are found in: (i) the Multi-Party Account Servicing Agreement (the "Brokerage Agreement"), (ii) the private placement memoranda ("PPM") for the 1998 Goldman Sachs Exchange Place Fund, L.P. (the "1998 Exchange Fund") and the 1999 Goldman Sachs Exchange Place Fund, L.P. (the "1999 Exchange Fund"), and (iii) the limited partnership agreements for the Exchange Funds. As is pointed out in the Plaintiffs' Corrected Trial Brief (pp. 12-14), the Goldman Sachs Defendants' argument based upon the Brokerage Agreement borders on frivolous. The text of the Brokerage Agreement, and the Instructions that accompanied it, limit the scope of the Brokerage Agreement to the supervision and handling of the Hasans' joint brokerage account at Goldman Sachs & Co. The Brokerage Agreement plainly does not apply to claims arising

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out of mismanagement of entities whose securities are properly brokered into the joint account. Thus, the Goldman Sachs Defendants' demand to enforce arbitration depends upon whether the Hasans agreed to be bound by arbitration provisions buried deep in the boilerplate text of the PPMs and the limited partnership agreements. In evaluating these latter two sources of the Goldman Sachs' arbitration argument, several points are essentially undisputed: 1. The only Goldman Sachs Defendant who can invoke these sources is Goldman Sachs Management Partners, L.P. (the general partner of each of the Exchange Funds) as it is the only Goldman Sachs Defendant that is a party to the limited partnership agreements--these agreements make no mention of any third party beneficiaries; 2. Neither of the Hasans ever executed any of the PPMs or the limited partnership agreements; 3. Ms. Hasan never executed any documents in respect of the 1998 Exchange Fund into which the Foundation Health Systems ("FHS") stock in which she held a joint interest was invested;1 4. The Goldman Sachs Defendants have no credible evidence that the PPMs for the Exchange Funds were ever sent to the Hasans prior to 2002;2 and 5. The Goldman Sachs Defendants have no evidence that the limited partnership agreements for either of the Exchange Funds were sent to the Hasans at any time prior to 2002.
1

Prior to the investment in the 1998 Exchange Fund, this FHS stock had been placed in street name (the name of Goldman Sachs & Co.), see Hrg. Exh. 5, and had been deposited into the Hasans' joint account. See Hrg. Exh. 65. Gary Giglio's testimony that he sent the 1998 Exchange Fund PPM to the Hasans under Hrg. Exh. 14 was overwhelmingly refuted by: (i) Malik Hasan's testimony that no PPM was enclosed with Hrg. Exh. 14, (ii) Mr. Giglio's testimony, on cross-examination, that he did not personally enclose any PPM with Hrg. Exh. 14--and he did not see anyone else do so, see Tr. of Nov. 9-10 Hrg. appended as Exhibit A at 184, (iii) the letterhead of Hrg. Exh. 14., and Hrg. Exh. 44, both affirm that Hrg. Exh. 14 was prepared and sent out by Robert Mueller--not by Mr. Giglio, and (iv) Mr. Mueller's deposition testimony (which is with the Court as it was designated as part of the November 9-10 hearing) that he does not recall sending the Hasans any PPM with Hrg. Exh. 14, and his letter does not state that any PPM is enclosed. See R. Mueller Depo. Tr. at 72, 95-96.
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Accordingly, the only thread that remains upon which Goldman Sachs Management Partners, L.P. can assert that either of the Hasans agreed to be bound by arbitration of the claims asserted against it is language contained in paragraph 10 of the subscription agreement (which has the investors agree to the terms of the limited partnership agreements). This is why the Goldman

Sachs Defendants struggle to persuade that the Hasans signed subscription materials that were bound into subscription booklets at the time of execution. But even this argument is inconsequential to the arbitration determination. Under the controlling precedent of Dumais v. American Golf Corporation, 299 F.3d 1216, 1219 (10th Cir. 2002), any claim that arbitration is required under the Subscription Agreements (contained in what are now bound subscription booklets) for the Exchange Funds is without merit. Under Dumais, any such arbitration agreement is illusory and unenforceable.3

Paragraph 10 of the Subscription Agreement provides, in pertinent part, that each investor "constitutes and appoints the General Partner ... as [the investor's] true and lawful agent and attorney-infact ... to ... amend ... the Partnership Agreement and any amendments thereto ... The power of attorney hereby granted is in addition to the power of attorney granted in Article 15.1 of the Partnership Agreement ..." (Emphasis supplied). The emphasized language is important because while Article 15.1 of the limited partnership agreements requires a vote of the limited partners to amend the partnership agreement, Paragraph 10 of the Subscription Agreement does not. Paragraph 10 of the Subscription Agreement (which is expressly independent of Article 15.1 of the partnership agreements) affords the general partner the unilateral ability to amend the partnership agreement, including the arbitration provision. Under Dumais, this power renders any arbitration "agreement" by limited partners illusory. After recognizing the "well-accepted rule that ambiguities in contracts are construed against the drafter" (in this case Goldman Sachs), 299 F.3d at 1219, the Dumais Court went on to "join the other circuits in holding that an arbitration agreement allowing one party the unfettered right to alter the arbitration agreement's existence or its scope is illusory [and unenforceable]." Id.

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II.

The Alleged "False" Testimony

Perhaps recognizing the futility of their arbitration demand, the Goldman Sachs Defendants press for leverage by declaring that Malik Hasan testified falsely about not: (i) believing that he was present when his signature on page 39 of the subscription agreement was notarized (Named Defendants' Motion at 3-6); (ii) having additional pages at the time that he signed certain signature pages taken from the subscription materials for the 1998 Exchange Fund (id. at 6-7); and (iii) having additional pages when the Hasans completed and signed certain pages taken from the subscription materials for the 1999 Exchange Fund (id. at 8-10). The Goldman Sachs Defendants profess that they were put to great expense in establishing the professed "falsity" of Dr. Hasan's testimony. Id. at 11-12. Let us be unmistakably plain; none of these assertions are true.

A. Notarized.

The Presence of Dr. Hasan When His Signature Was

The Goldman Sachs Defendants first challenge Dr. Hasan's

deposition testimony that he does recall, and does not believe, that he appeared before the notary who notarized his signature on page 39 of the 1998 Exchange Fund subscription agreement.4 The notary, Loraine Tozzo, was deposed in June of 2005. She testified that she: (i) did not know Dr. Hasan in October of 1998 (L. Tozzo Depo. Tr. at 25); (ii) does not recognize Dr. Hasan from his photograph (id. at 18); (iii) does not have any recollection of notarizing his signature (id. at

The Named Defendants' Motion at 3 points to Paragraph 63(d)(ii) of the Amended Complaint that alleges upon information and belief that Dr. Hasan was not present at the time that his signature was notarized and did not acknowledge his signature to t he notary.

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21); (iv) does not maintain a notary book or other records of her notarizations (id. at 19); and (v) sometimes notarizes signatures of persons who do not appear before her. (Id. at 34). See L. Tozzo Depo. Tr. appended as Exhibit B. In order to support their assertion that Dr. Hasan's deposition testimony was "false," the Goldman Sachs Defendants point to: (a) an affidavit that Dr. Hasan executed in 1999 in AEQ, LLC v. Monument Systems, Inc., which was filed in New York, and (b) an October 7, 2005 affidavit of Morris Sandler. Dr. Hasan's 1999 affidavit merely states that he was in New York on October 22, 1998 for a meeting attended by Mr. Sandler. Mr. Sandler's affidavit states that at some point during the meeting he took Dr. Hasan to Ms. Tozzo's desk on the Eighth Floor of 477 Madison Avenue to have a document notarized. To observe that Mr. Sandler's testimony emits an unpleasant odor is truly charitable. Mr. Sandler was deposed on November 4, 2005 (and his transcript is with the Court as it was designated as part of the November 9-10 hearing). Just to give the Court a small sample, Mr. Sandler testified in

deposition that: (i) he is a former employee of an J. Aron & Co., an entity owned by Goldman Sachs (M. Sandler Depo. Tr. at 31); (ii) he later formed a venture capital and merchant banking firm with a former Goldman Sachs partner (id. at 39-40); (iii) his affidavit was prepared by counsel for the Goldman Sachs Defendants (id. at 78-79); (iv) his affidavit erroneously fails to mention that Dr. Steinberg (one of only four people in attendance) was at the meeting in New York on October 22, 1998 (id. at 70);

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(v) his affidavit fails to mention that the document notarized was a bound "booklet"--but his recollection "improved" upon meeting with counsel for the Goldman Sachs Defendants the day before his deposition (id. at 82); (vi) despite reviewing Hrg. Exh. 10A the day before his deposition, and despite holding it in his hands during the deposition direct examination, on cross-examination Mr. Sandler could not recall the number "254" and "Dr. M.M. Hasan" placed quite prominently on its cover (id. at 88-89); (vii) following notarization of the document, Ms. Tozzo photocopied it (Mr. Sandler does not recall how many pages) and faxed it off to Goldman Sachs (id. at 92-96)--it is therefore noteworthy, of course, that the Goldman Sachs Defendants have not--and cannot--produce from their files a copy of the fax version of this signature page; (viii) he could not recall whether the parties signed any documents at the only other meeting between them--which occurred at the Denver Airport two weeks prior to the October 22, 1998 meeting in New York (id. at 110-11); (ix) 05); (x) he had met Seeme Hasan by October of 1998 (id. at 105), and then contradicted himself by testifying that he had not met her (id. at 106-110); (xi) the meeting in New York on October 22, 1988 was to discuss a potential deal between a company in which Dr. Hasan was a lead investor (Monument Systems) and Mr. Sandler's company, AEQ, LLC--and following the meeting in New York the deal collapsed (id. at 6465); (xii) Following the collapse of the deal Mr. Sandler's company cratered for lack of revenue and new capital (id. at 66-67), which cost Mr. Sandler a "substantial investment" in AEQ, LLC, and tarnished the track record of the investors in AEQ, LLC (id. at 115-117); (xiii) AEQ, LLC then sued Monument Systems (id. at 68)--the suit from which Dr. Hasan's affidavit was taken--but despite being Chairman of AEQ, LLC, and having a "substantial investment" in it, Mr. Sandler could not recall any of the details of the lawsuit or the settlement that followed. (Id. at 68-69). he could not recall anything about Dr. Hasan (id. at 101-

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Despite almost no recall--and sometimes demonstrably erroneous recall--of contemporaneous events and circumstances, most of which had much greater personal impact upon him, Mr. Sandler curiously professes to remember walking with Dr. Hasan to Ms. Tozzo's desk at a point in time more than eight years ago. It would be fair to conclude that manifest bias, coupled with the not so subtle influence of counsel for the Goldman Sachs Defendants, have more than a little to do with this particular "recollection." In sum, none of the "evidence" that the Goldman Sachs Defendants claim to have uncovered demonstrates any falsity in Dr. Hasan's testimony (that he does not recall, and does not believe, that he was present when his signature was notarized by Ms. Tozzo).

B.

The Failure to Provide Dr. Hasan with the Complete 1998 Next, the Goldman Sachs Defendants

Exchange Fund Subscription Booklet.

assail Dr. Hasan's testimony that he was furnished with only a portion of the Subscription Booklet for the 1998 Exchange Fund. Dr. Hasan testified on

November 10, 2005, without contradiction by any of the Goldman Sachs Defendants, that a few pages from the subscription materials were forwarded to him so that he could execute signature pages, on a non-binding basis, so as to put the Hasans in the running for potential inclusion of their FHS shares in the 1998 Exchange Fund.5

Dr. Hasan testified that these pages were never intended to represent a final "agreement" that would bind the Hasans. For instance, Dr. Hasan testified that he was told by Mr. Mueller that similar signature pages would be sent to Ms. Hasan (this was ultimately neglected). Mr. Mueller also told Dr. Hasan that if the Hasans' FHS shares were accepted for inclusion into the 1998 Exchange Fund: (i) the Hasans would be sent copies of the operative investor materials, and (ii) the Hasans could then decide

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The Goldman Sachs Defendants then engage in a parsing of the deposition testimony of two document examiners to "demonstrate" that Dr. Hasan's best recollection as to the number of pages from the 1998 Exchange Fund subscription materials that were sent to him was false. The claim of the Goldman Sachs Defendants is unpersuasive for a host of reasons. First, Paige Doherty, one of the document examiners cited by the Goldman Sachs Defendants, repeatedly testified that application of the available document tests, including the "indented writing" test, is inconclusive with respect to whether the materials were bound when they were signed by Dr. Hasan. See P.Doherty Depo. Tr. appended as Exhibit C (at 81-83). Second, Dr. Hasan testified that the subscription pages came in two different lots in October of 1998, and pages from these lots were signed at different times. Dr. Hasan received a few pages when he was traveling on the East Coast in the latter half of October of 1998--and he signed page 39 on October 22, 1998. He also testified that a few days later he received additional pages for execution (including pages 47 and 49) which were sent to Beaver Creek and which he saw when he returned home. At the risk of belaboring, Dr. Hasan stated that in the week preceding October 26, 1998 he received--in two different shipments--both sides of pages 7, 18, 29, 39, 47 and 49 from the 1998 Exchange Fund subscription materials. None of this is inconsistent with Dr.

whether to accept or pass on a 1998 Exchange Fund investment. Indeed, the initial Inspection Report sent to the Hasans, Hrg. Exh. 27, specifically refers to a withdrawal right held by potential investors.

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Hasan's Amended Affidavit, see appended Exhibit D (at ¶8), executed, filed and served more than two months before the November 9-10 hearing.6 Third, it should be observed that the evidence corroborating Dr. Hasan's testimony that he was not provided with a bound subscription booklet for the 1998 Exchange Fund is particularly compelling. following: 1. Gary Giglio, a partner in Goldman Sachs who was the leader of the Houston team that handled the Hasans' account, testified at the March 8, 2005 hearing before this Court that a transmittal letter always accompanied the transmission to potential investors of the Exchange Fund subscription booklets and the limited partnership agreements. See Tr. of 3/8/05 Hrg. appended as Exhibit E at 93. The Goldman Sachs Defendants have been unable to produce any such transmittal letter to the Hasans. 2. Rosemary Angelino, a Goldman Sachs employee in New York working with the Exchange Funds, testified at the hearing on November 9-10, 2005. She affirmed that the Goldman Sachs branch offices were provided with Federal Express packages--addressed to the New York office of Goldman Sachs--to be sent to investors to use once they completed the Exchange Fund subscription booklets. See Exhibit A at 44-45. However, according to the deposition testimony of Kathleen Eskola, a Goldman Sachs employee in its Houston office (whose deposition transcript is with the Court as it has been designated as part of the November 9-10 hearing), nearly all of the material in Dr. Hasan's 1998 Exchange Fund subscription materials was completed (often with incorrect information) by her. See K. Eskola Depo. Tr. at 15-20. If a bound subscription booklet would have been available to him Dr. Hasan he would have completed it with correct information and sent it to New York. There would have been no reason for him to send it to the Houston office of Goldman Sachs. It includes at least the

The Court will recall that Dr. Hasan furnished the Amended Affidavit partially in response to the conduct of counsel for the Goldman Sachs Defendants at his deposition. After consuming the full 7 hours of deposition time permitted by Fed.R.Civ.P. 30(d)(2) on direct examination of Dr. Hasan, counsel for the Goldman Sachs Defendants professed that if any cross-examination were conducted by the Hasans' counsel the Goldman Sachs Defendants would require an unspecified period for re-direct examination notwithstanding the express deposition time limitation contained in Fed.R.Civ.P. 30(d)(2). Rather than cross examine (which would have meant engaging in a deposition of indeterminate duration or expensive litigation over a collateral discovery dispute) the Amended Affidavit was prepared, filed and served.

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3. Dr. Hasan's 1998 Exchange Fund subscription booklet, which now appears in bound format, inexplicably contains the booklet number "254" both on the cover and on certain the interior pages (as if to designate which booklet from which a section one or more pages originated). This would be necessary only if portions of the materials were sent out for signature and were to be incorporated into a complete booklet later. Ms. Angelino testified that it was not typical practice to place such book numbers on the interior pages of subscription booklets. See Exhibit A at 113-14. 4. The hearing testimony of both Donald Vacca, the document examiner retained by the Goldman Sachs Defendants (see Exhibit A at 283), and Thomas Graziano (see T. Graziano Depo. Tr. appended as Exhibit F at 83-85) was that small machines that are capable of binding loose pages with a "perfect bind" have been available to Goldman Sachs in the marketplace. 5. When Dr. Hasan requested in writing, in May of 2003, that the Goldman Sachs Defendants send him copies of the agreements that he had signed in respect of the Exchange Funds, See Hrg. Exh. 16, the following day he was faxed from Goldman Sachs a portion of the 1998 Exchange Fund subscription booklet. This segment does not contain the Paragraph 10 of the subscription agreement. See Hrg. Exh. 17.

C.

The Failure to Provide the Hasans with the Complete 1999 The Goldman Sachs Defendants next

Exchange Fund Subscription Booklet.

accuse Dr. Hasan of false testimony for failing to state with crystal clarity in his November 2004 affidavit that the Hasans received in 1999 only portions of the 1999 Exchange Fund subscription materials. In particular, they complain that Dr. Hasan's November 2004 affidavit is grammatically different than his subsequent clarifying testimony in this case. In fact, when the subject language from the November 2004 affidavit was drawn to his attention, Dr. Hasan consistently clarified any grammatical error in his original affidavit; and he did so on at least three separate occasions. First, as the Named Defendants' Motion acknowledges he clarified

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the language in his testimony before this Court on March 8, 2005. Second, he reaffirmed the clarification (that only a portion of the 1999 Exchange Fund subscription materials were received by the Hasans in 1999) at his deposition testimony on May 26-27, 2005. Finally, in paragraph 18 of his Amended Affidavit filed and served on September 7, 2005, see Exhibit D at ¶18, Dr. Hasan again reaffirmed that only a portion of the 1999 Exchange Fund subscription materials were received by the Hasans in 1999. Most importantly, Mr. Vacca confirmed during his testimony on November 10, 2005 that Dr. Hasan's testimony that the Hasans did not receive a bound subscription booklet for the 1999 Exchange Fund is correct. The Court will recall that Mr. Vacca testified that among the indentations that he found on page 51 of Hrg. Exh. 11A--the now bound version of the subscription booklet for the 1999 Exchange Fund--were the words "Foundation" and "FHS." See Exhibit A at 288-89. Since neither of these words appear anywhere on page 49, it follows that one or more other pages (perhaps pages 9, 14 and/or 31 where these words do appear) were being written on at a time when page 51 was immediately below. This would not be possible if someone was writing in Hrg. Exh. 11A at a time when it was bound. The conclusion is inescapable--Dr.

Hasan's testimony about not having a bound subscription booklet is correct; loose pages from the 1999 Exchange Fund subscription booklet were bound sometime after they were written on and completed.

D.

Getting in the Queue.

Next, the Goldman Sachs

Defendants pronounce that language contained on pages from the subscription

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materials that were in the Hasans' possession when materials for the Exchange Funds were signed renders the Hasans' claims false (Named Defendants' Motion at 9-10). Of course, this argument ignores the key point. As noted above, Dr. Hasan testified at the recent hearing before this Court--without contradiction from any of the Goldman Sachs Defendants-that certain pages from the subscription materials for the respective Exchange Funds were forwarded to the Hasans in October of 1998 and August of 1999. These were forwarded with the explanation by Mr. Mueller that the pages should be executed to place the Hasans in the queue, on a non-binding basis, for potential inclusion of their FHS shares in the Exchange Funds. Dr. Hasan was assured that neither side was bound at the time that these pages were executed and returned by the Hasans. The investment managers constructing the

Exchange Funds remained free to reject the Hasans' FHS shares in constructing the final portfolio for the Exchange Funds. And, Dr. Hasan was told that if the shares were ultimately accepted by the investment managers the Hasans would receive the full set of investor materials. Only then would the Hasans be in a position to accept the invitation to join the Exchange Funds or to pass. Dr. Hasan's testimony was unequivocal--the Hasans expected to receive full sets of investment materials to make their determination. But by oversight or neglect in the Houston office of Goldman Sachs these materials (including the PPMs and partnership agreements) never arrived. E. The Contrived "Burdens" Imposed Upon the Goldman Sachs

Defendants. Finally, the Goldman Sachs Defendants profess that they engaged

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in expensive discovery to "demonstrate" the falsity of Dr. Hasan's testimony. The effort is claimed to include: (a) the depositions of printers/binders, (b) the depositions of document examiners, (c) discovery of Ms. Tozzo, and (d) investigation into Dr. Hasan's 1999 affidavit in AEQ, LLC v. Monument Systems, Inc. First, the Goldman Sachs Defendants claim that they deposed Thomas Graziano and Raymond DeLuca to show that Goldman Sachs did not send out to potential investors unbound investment materials. Although Mr.

Graziano testified that he does not recall that his employer, a bindery called BindRite Services ("BRS"), ever delivered unbound investment materials to Bowne, the printer for which BRS worked in 1998, he also testified, see Exhibit F, that: (i) Bowne cannot confirm that Bowne performed the printing work for the 1998 Exchange Fund subscription booklet (T. Graziano Depo. Tr. at 15-16); (ii) Mr. Graziano does not know, and cannot testify, that BRS did the binding work for the 1998 Exchange Fund subscription booklet (id. at 51-52; 55); (iii) in 1998, Bowne also contracted with binderies other than BRS (id. at 56-57), and he does not know whether other binderies delivered unbound materials; and (iv) small binding machines capable of binding loose pages with a perfect bind have been available in the marketplace (id. at 83-85). Similarly, Mr. DeLuca, a former employee of Global Financial Press ("GFP"), testified, see Exhibit G appended, that: (i) GFP did not do any printing or binding work--it contracted out to others all printing/binding work for Goldman Sachs (R. DeLuca Depo. Tr. at 59);

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(ii) he does not know whether GFP had any role in the production of Exh. 11A, the subscription booklet for the 1999 Exchange Fund (id. at 27-28, 34); (iii) binderies to which the Goldman Sachs binding work was subcontracted would have had unbound versions of the subscription materials known as "press run overs" (id. at 57-58); (iv) he does not know which bindery did the binding work on Exh. 11A (id. at 71), or what press run over materials were at the bindery (id. at 74); and (v) he does not know whether Goldman Sachs requested that "press run overs" of the 1999 subscription booklet be delivered to it (id. at 62). Thus, the testimony of Messrs. Graziano and DeLuca does not contradict Dr. Hasan's testimony. Moreover, the deposition testimony of Gordon Binder (which is with the Court as it was designated as part of the November 910 hearing), at 11-16 and 37-38, vanquishes any suggestion that all investment materials transmitted by Goldman Sachs to investors were uniformly bound. Mr. Binder produced irrefutable evidence to the contrary (in his case, the PPM for the 1999 Exchange Fund sent to him by Goldman Sachs).7 Second, the Goldman Sachs Defendants profess that they went to great expense to retain Mr. Vacca, their expert document examiner, to refute Dr. Hasan. However, as noted at page 12 above, Mr. Vacca's indentation findings actually corroborate Dr. Hasan's testimony (that Hrg. Exh. 11A was not bound until sometime after the loose pages were written on and completed). And,

although somewhat less dramatic, Mr. Vacca's findings also corroborate Dr.

And, of course, the Hasans received other unbound investment materials when these were finally sent out to the Hasans by Goldman Sachs in 2003. See Hrg. Exhs. 7, 15, 26 and 8.

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Hasan's testimony with respect to Hrg. Exh. 10A not being bound when it was completed.8 Third, the Goldman Sachs Defendants claim that they went to great expense to discover and produce the testimony of Ms. Tozzo. As previously pointed out (pp. 5-6 above), Ms. Tozzo did not contradict Dr. Hasan's testimony Finally, the Goldman Sachs Defendants highlight their effort in finding Dr. Hasan's affidavit in the AEQ, LLC v. Monument Systems, Inc. litigation. Dr. Hasan's affidavit identified Mr. Sandler by name, and permitted them to secure his testimony. That testimony (summarized at pp. 6-8 above) proved biased and implausible, and in any event does not demonstrate any falsity in the testimony of Dr. Hasan as to his recollection and belief.

III.

Summary

The Hasans sincerely apologize for the length of this Response in Opposition to the Named Defendants' Motion. They sincerely appreciate the burden that has been placed upon this Court by the volume of paper from this case. However, the Hasans take very seriously their responsibilities to this

Court, and believe that a careful review of the testimony and evidence was necessary to expose the Named Defendants' Motion for what it is.

For instance, Mr. Vacca testified on November 10, 2005 that he examined page 49 of Hrg. Exh. 10A for indented writing originating from page 47. Mr. Vacca affirmed that "[i]n the middle of [page 49], I recovered indented writing that shows 300,000. That didn't correspond to anything that was on [page 47]." See Exhibit A at 250. It appears that Mr. Vacca was seeing indented on page 49 a portion of the number "2,000,000" that appears in the middle of page 29 of Hrg. Exh. 10A. This finding tends to corroborate that the subscription materials for the 1998 Exchange Fund were not bound as of October 29, 1998 (the date there recorded as to when the "2,000,000" number was placed on page 29 of Hrg. Exh. 10A).

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WHEREFORE, the Hasans respectfully urge this Court to deny the Named Defendants' Motion. Moreover, in light of the lack of substance the

Hasans respectfully pray that this Court award them their reasonable attorneys' fees for the necessity of opposing the Named Defendants' Motion. Dated: November 30, 2005. Respectfully submitted,

s/ Glenn W. Merrick Glenn W. Merrick Senn · Visciano · Kirschenbaum · Merrick P.C. Suite 4300, 1801 California Street Denver, Colorado 80202 Telephone: (303) 298-1122 Facsimile: (303) 296-9101 Email: [email protected] ATTORNEYS FOR PLAINTIFFS MALIK M. HASAN, M.D. and SEEME G. HASAN

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CERTIFICATE OF SERVICE I hereby certify that on November 30, 2005, I electronically filed the foregoing RESPONSE IN OPPOSITION TO "THE NAMED DEFENDANTS' MOTION FOR PRECLUSION AND OTHER RELIEF" with the Clerk of Court using the CM/EMF system which will send notification of such filing to the following e-mail addresses: Bruce A. Featherstone Featherstone DeSisto, LLP [email protected] Max Gitter Cleary Gottlieb Steen & Hamilton, LLP [email protected] and I hereby certify that I have mailed or served the same on the following non CM/ECF participant via U.S. Mail, postage prepaid addressed to: Nancy I. Ruskin, Esq. Cleary, Gottlieb, Steen & Hamilton LLP One Liberty Plaza New York, New York 10006

s/ Dyanna Spicher

____

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