LAW OFFICES
. NIS E N & E L1.: OTT ’ ·.~.v.,
er surra asoo `@r;`__,;f’f "
MICHAEL H. MOIRANO EOC WEST ADAMS STREET 1·E|_EpHONE V
DIRECT DIAL c:r—u<:A
May 23, 2006
VIA MESSENGER
Gregory E. Rogus
Segal, McCambridge, Singer & Mahoney, Ltd.
One IBM Plaza
330 North Wabash Avenue
Suite 200
Chicago, Illinois 6061 1
Re: Flowserve Corporation v. Burns International Services Corporation
Dear Greg:
Enclosed are documents Bates numbered B00651—B01229 being produced by Burns in
response to Flowserve’s requests for the production of documents. These documents are in
addition to the documents previously produced by Burns, Bates numbered B000Ol-B00650.
Also enclosed, pursuant to F1owserve’s request, are two CD ROMs which contain a complete set
of the closing documents relating to the leveraged buy-out of Borg-Wamer Corporation. These
documents were produced by Borg-Wamer, Inc. in the pending Illinois declaratory judgment
action and bear Bates numbers BWI 0024903-BVVI 0032652.
We have reviewed the documents produced by F lowserve in response to Burns’ requests
for production and did not see any documents supporting the allegation that Flowserve
Corporation is the successor in interest under the 1987 Stock Purchase and related Letter
Agreements and thus the proper party to assert rights under those Agreements. F lowserve’s
. complaint alleges that "Through a series of corporate successions, the named parties to the
instant action have acquired their respective indemnification rights and obligations" and that
Flowserve succeeded to the rights under the Stock Purchase Agreement "on July 22, 1987, when
BW/IP, Inc.[formerly known as BWIP Acquisition Corporation] merged with Durco
International, Inc. to form a new entity named Flowserve Corporation." We did not see in the
documents Flowserve produced any corporate records showing the alleged "corporate
succession†whereby F lowserye succeeded to the rights under the Stock Purchase or Letter
- Agreements. Nor were any documents produced concerning the alleged name change of BWIP
Acquisition Corporation to BW/IP, Inc., or the merger of BW/IP, Inc. with Durco Intemational.
Burns specifically requested that documents supporting these allegations and transactions be
produced. See Bums’ Documents Request 8-9. Please request your client to produce the
documents supporting these material allegations as soon as possible.
A _, Case 1 :04-cv—01294-JJF Document 96-2 Filed 09/08/2006 Page 2 of 3
NISEN & ELLIOTT, LLC
Gregory E. Rogus, Esq.
May 23, 2006
Page 2
In addition, we would like to depose John Hannesson who is identified in Flowserve’s
answers to Burns’ interrogatories as a person having knowledge of the corporate successorship
and merger issues. Mr. Hannesson is identified as a former general counsel of BW/IP, Inc. and
person with whom Flowserve consulted in preparing its interrogatory answers. Let me know if
you would like to contact Mr. Hannesson to arrange his deposition. If not, please provide his
contact information so I may contact him.
Finally, there are two additional issues concerning Flowserve’s discovery reposnese
which need to be addressed. First, Burns requested Flowserve to produce complete copies of` all
Borg-Warner insurance policies which Flowserve or its predecessor possessed on May 1, 1987,
the date the Letter Agreement was executed. Burns Request 23. Flowserve objected to the
request on the grounds that it was "overly broad and unduly burdensome." Flowserve has
specifically alleged the existence of` these policies in its complaint. (il 23) In addition, F lowserve
recently advised the District Court that it intended to introduce the policies in evidence to
establish its alleged "direct right" to access the Borg-Warner insurance. In light of these
allegations and claims, there is no legitimate basis for F lowserve to ref`use to produce the —
policies. Second, Flowserve objected, on the grounds of attorney/client privilege, to the
production ofthe documents requested in Burns’ Requests 28 and 30. Please provide a privilege
log identifying the documents being withheld.
J Vgry gy yours,
rc ael H. Moirano
MHM : je
cc: Francis J. Murphy, Esq.
' Case 1 :04-cv—01294-JJF Document 96-2 Filed 09/08/2006 Page 3 of 3
LAW OFFICES
N ISEN & ELLIOTT
SU ITE 2500
MICHAEL H- MOIRANO BOO WEST ADAMS STREET TELEPHONE
DIRECT DML CHICAGO, ILLINOIS COGOG ‘3'i;;’;";fEB°°
(3IE) 696-ESOB EMAIL mmoiran¤@nisen.com (3I2) 346-93IG
July 26, 2006
VIA FACSIMILE A
Gregory E. Rogus
Segal, McCambridge, Singer & Mahoney, Ltd.
One IBM Plaza
330 North Wabash Avenue
Suite 200
Chicago, Illinois 60611
Re: Flowserve Corporation v. Burns International Services Corporation
Dear Greg:
I wrote to you on May 23, 2006, requesting (1) documents supporting the allegation that
Flowserve Corporation is the successor in interest under the 1987 Stock Purchase and related
Letter Agreements and thus the proper party to assert rights under those Agreements; and (2)
contact infonrration for John Hannesson who is identified in Flowserve’s answers to Burrrs’
interrogatories as a person having knowledge of the corporate successorship and merger issues.
There has been no response to either request. Please confirm whether there are documents
showing that Flowserve Corporation is the successor in interest under the Stock Purchase and
Letter Agreements, and if you intend to provide contact information for Mr. Harrnesson. Also, let
me know if we need to subpoena Mr. Herrke for his deposition.
If I do not hear from you with seven days, or by the close of business on August 2, 2006,
I will assume (1) there are no documents establishing Flowserve Corporations’s status as the
successor in interest under the Stock Purchase and Letter Agreements; (2) that you will not
provide contact information for Mr. Hannesson; and (3) that we will have to subpoena Mr.
Henke for his deposition.
V ruly yours,
. Moirano
MHM:je
cc: Francis J. Murphy, Esq.
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