Free Motion to Strike - District Court of Arizona - Arizona

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LAW OFFICES One Arizona Center, 400 E. Van Buren Phoenix, Arizona 85004-2202 (602) 382-6000

Sid Leach (#019519) Monica A. Limón-Wynn (#019174) Snell & Wilmer L.L.P. One Arizona Center 400 E. Van Buren Phoenix, Arizona 85004 Attorneys for Defendants MasterCard International Incorporated and MasterCard International, L.L.C. IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA Lexcel Solutions, Inc., Plaintiff, vs. MasterCard International, Inc. and MasterCard International, L.L.C., Defendants. Case No. CV-03-1454-PHX-JAT MOTION TO STRIKE DECLARATION OF FLORA "PETE" KUBITZ

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Defendants MasterCard International, Inc. and MasterCard International, L.L.C. (collectively "MasterCard") move this Court for an Order striking from the record Paragraphs 10, 11, 14-16, and 18 from the Declaration of Flora "Pete" Kubitz ("Ms. Kubitz") attached as Exhibit 1 to Lexcel's Motion for Preliminary Injunction, and all references thereto in Lexcel's Motion for Preliminary Injunction, because it contains inadmissible evidence and is inherently deficient. Ms. Kubitz's self-serving Declaration is replete with hearsay and conclusory statements, and is unsupported by specific facts. As such, the foregoing Paragraphs of Ms. Kubitz's Declaration do not constitute admissible evidence and should not be considered by the Court in ruling upon Lexcel's Motion for Preliminary Injunction. This motion is supported by the following memorandum of points and authorities.

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LAW OFFICES One Arizona Center, 400 E. Van Buren Phoenix, Arizona 85004-2202 (602) 382-6000

MEMORANDUM OF POINTS AND AUTHORITIES
I. THE INADMISSIBLE EVIDENCE OF THE DECLARATION SUBMITTED BY LEXCEL IN SUPPPORT OF ITS MOTION FOR PRELIMINARY INJUNCTION ARE PRECLUDED FROM BECOMING PART OF THE RECORD Under Rule 65(a)(2) of the Federal Rules of Civil Procedure, only evidence "which

would be admissible upon the trial on the merits becomes part of the record." Because
portions of Flora Kubitz's Declaration contains inadmissible evidence, those portions of the Declaration and the portions of Lexcel's Motion for Preliminary Injunction must be stricken from the record in this case. A. The Declaration of Ms. Kubitz Fails to Set Forth Admissible Evidence

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A declaration must be made on personal knowledge, and must affirmatively show that the affiant is competent to testify to the matters set forth. See Jobe v. Sofamor, No. CIV 96-2628-PHX-SMM, 1998 U.S. Dist. LEXIS 19833, at *4 (D. Ariz. Sept. 4, 1998) ("conclusory, self-serving affidavits, lacking detailed facts and any supporting evidence, are insufficient"); Ross-Whitney Corp. v. Smith Kline & French Laboratories, 207 F.2d 190, 197-98 (9th Cir. 1953) ("affidavits must meet the requirements of due process"); The Villas At Hidden Lakes Condominiums Ass'n v. Geupel Construction Co., Inc., 174 Ariz. 72, 81, 847 P.2d 117 (Ct. App. 1992) ("the affiant must by personal knowledge show both competency to testify about the matters in the affidavit and state facts that would be admissible evidence"); Pacific Legal Foundation v. State Energy Resources, 659 F.2d 903, 913 n.18 (9th Cir. 1981) (concluding that movant's "unsupported and conclusory affidavit" was insufficient).
Statements in a declaration or affidavit that are not based on personal knowledge are not admissible as evidence. Columbia Pictures v. Professional Real Estate Investors, 944 F.2d 1525, 1529 (9th Cir. 1991) (declaration insufficient because statements were not based on personal knowledge); see also Taylor v. List, 880 F.2d 1040, 1045 n.3 (9th Cir. 1989)

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LAW OFFICES One Arizona Center, 400 E. Van Buren Phoenix, Arizona 85004-2202 (602) 382-6000

(same). Moreover, when the proponent of the statement fails to establish a proper

foundation, the statement is not admissible. Amarel v. Connell, 102 F.3d 1494, 1516
(9th Cir. 1997). Many statements in Ms. Kubitz's Declaration are nothing more than hearsay and Ms. Kubitz's own legal conclusions. The offending statements contain not only inadmissible hearsay, but suffer from lack of foundation, are unsupported by specific facts, are vague and conclusory, are mere conclusions of law, or are statements for which Ms. Kubitz lacks sufficient personal knowledge. These statements simply cannot be given any weight and should be stricken from the record. The following material Paragraphs from Ms. Kubitz's Declaration should be stricken from the record: · Paragraph 10, Ms. Kubitz asserts that "MasterCard delayed in informing" its sublicensees that they could continue to use the existing simulator of Lexcel's, yet makes the unsupported assertion that "[d]uring this delay . . . MasterCard's new test system software was the only product that MasterCard would accept." That statement directly contradicts the document on which Ms. Kubitz's Paragraph 7 relies: the December 2003 communication. In its Operations Global Bulletin dated December 1, 2003, MasterCard notified members as follows: Members can continue to use the existing similar until 29 April 2005. After this date, MasterCard will retire and no longer will support the existing simulator products and the sublicenses grated to members will terminate. Id. This Bulletin flatly contradicts Ms. Kubitz's statement in Paragraph 10. Ms. Kubitz's conclusory statement lacks factual support. · Paragraph 11 is Ms. Kubitz's self-serving contention that MasterCard engaged in some wrong doing that caused injury to Lexcel. This conclusory statement lacks foundation. · The statements in Paragraphs 14, 15 and 16 regarding what some unidentified person from Washington Mutual purportedly "told" someone at Lexcel are pure hearsay. Moreover, Lexcel failed to previously disclose the identity of any witness from Washington Mutual. It is too late now to disclose any additional witnesses. · The statements in Paragraph 16 are plainly inadmissible conclusions of law. Paragraph 16 improperly contains a legal conclusion purporting to interpret MasterCard's obligations under the contract and concluding (albeit incorrectly) that

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LAW OFFICES One Arizona Center, 400 E. Van Buren Phoenix, Arizona 85004-2202 (602) 382-6000

MasterCard's notifications to its members in December 2003 and January 2004 requiring the return of "HASP" security devices were somehow inappropriate. Similarly, Ms. Kubitz's conclusion in Paragraph 16 that this requirement is a "violation" of the contract is an improper conclusion of law (even with Ms. Kubitz's attempt to mask it with the phrase "To my understanding"). · As with Paragraphs 14, 15, and 16, Paragraph 18 contains reference to some unidentified third-person who purportedly "notified" Lexcel regarding what some document may have said. Not only are the statements in Paragraph 18 doublehearsay, they are objectionable because under the best evidence rule, the contents of the document should be proved by the original, not by the declarant relaying what a "customer" supposedly told her the document purportedly said. Moreover, Ms. Kubitz contends in Paragraph 18 that Lexcel did not receive this document "though normal business operations," but does not state whether she ever actually saw it herself. The referenced document is not in evidence. B. The Court Should Not Consider the Portions of Lexcel's Motion for Preliminary Injunction that Rely Upon Ms. Kubitz's Declaration

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Lexcel's Motion for Preliminary Injunction relies upon many of the improper statements contained in Ms. Kubitz's Declaration. Because the Court cannot consider the inadmissible "evidence" (e.g. hearsay, conclusions of law, unsupported statements of fact, etc.) set forth in Ms. Kubitz's Declaration, the Court should given no consideration whatsoever and strike from the record the following assertions appearing in the Motion: · the unsupported statements that MasterCard has not been informing its sublicensees that it may license the Lexcel software, because such statements are directly contradicted by documents produced in this action (Motion at 2:19-23, 8:24, 8:28, 11:3-9.) (See documents attached to MasterCard's Brief in Opposition to Lexcel's Motion for Preliminary Injunction filed on August 29, 2005.) · the hearsay statements from unidentified persons who have not been previously disclosed, and assertions purporting to say what a document provides when the document is not in evidence (Motion at 5:16-26, 6:3-5, 6:9-21, 8:2-4, 9:14-17, and 9:19-28.) · conclusions of law and unsupported statements (Motion at 9:12-14.)

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LAW OFFICES One Arizona Center, 400 E. Van Buren Phoenix, Arizona 85004-2202 (602) 382-6000

II.

CONCLUSION

For the foregoing reasons, MasterCard respectfully requests that this Court strike
the following Paragraphs from the record giving them no consideration whatsoever: Paragraphs 10, 11, 14-16, and 18 of the Declaration of Flora "Pete" Kubitz attached as Exhibit 1 to Lexcel's Motion for Preliminary Injunction. MasterCard further requests that the Court disregard the above-referenced portions1 of Lexcel's Motion that rely upon the assertions made in this Declaration. RESPECTFULLY SUBMITTED this 1st day of September, 2005. SNELL & WILMER, LLP By s/ Monica A. Limón-Wynn Sid Leach Monica A. Limón-Wynn One Arizona Center 400 E. Van Buren Phoenix, Arizona 85004 Attorneys for Defendants MasterCard International Incorporated and MasterCard International, L.L.C.

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1

The portions of the Motion for Preliminary Injunction that should be stricken are Page 2 lines 19-23, Page 5 lines 16-26, Page 6 lines 3-5 and 9-21; Page 8 lines 2-4 and 28; Page 9 lines 12-17 and 19-28 and Page 11 lines 3-9.

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LAW OFFICES One Arizona Center, 400 E. Van Buren Phoenix, Arizona 85004-2202 (602) 382-6000

CERTIFICATE OF SERVICE A copy of the foregoing MASTERCARD'S BRIEF IN OPPOSITION TO LEXCEL'S MOTION FOR PRELIMINARY INJUNCTION was served upon counsel of record on this 1st day of September, 2005 in the manner indicated below: Donald J. Lenkszus P.C. Donald J. Lenkszus P.O. Box 3064 7301 E. Sundance Trail, C203 Carefree, Arizona 85377-3064 Michael O. Sutton, Esq. Locke Liddell & Sapp L.L.P. 600 Travis St., Suite 3400 Houston, Texas 77002 Attorneys for Plaintiff Via First Class Mail

Via First Class Mail

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By s/Linda I. Patenaude
1719190.1

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