Free Order on Motion for Partial Summary Judgment - District Court of Arizona - Arizona

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA CIVIL MINUTES

Phoenix Division CIV 02-1954-PHX-MHM Year Case No. HON: MARY H. MURGUIA Judge # 7027 DATE: 3/20/08

Merchant Transaction Systems, et al., v. Nelcela Inc., et al. Plaintiff(s) Defendant(s) Deputy Clerk: Kristen Parris Court Reporter: Merilyn Sanchez

Richard Halloran, Robert McKirgan, George Chen, and Nicholas DiCarlo Plaintiff(s) counsel Ray Harris and Veronica Manolio Defense counsel ============================================================================= SEALED PROCEEDINGS: X Open Court Chambers Also present are Plaintiffs: Carl and Pete Kubitz and Mary Gerdts and Defendant Len Campagna. Motion Hearing re: Joint Parties Motion for Partial Summary Judgment [548] and oral argument re: analytical dissection and statute of limitations held. Counsel argue their positions regarding statute of limitations. Based upon the evidence presented by Lexcel and the applicable law, the Court FINDS that it would be in appropriate to find that Lexcel is barred by the statute of limitations and any questions concerning the damages that Lexcel can recover in light of the statute of limitations is a matter for the jury in Phase Two of this litigation. Counsel argue their positions regarding analytical dissection. FOR THE PLAINTIFFS: Dr. David Posner is sworn, examined, cross-examined, questioned by the Court, and excused. FOR THE DEFENDANTS: Jeffrey Pell is sworn, examined, cross-examined, further examined on redirect, questioned by the Court, further cross-examined, and excused.

Case 2:02-cv-01954-MHM

Document 595

Filed 03/20/2008

Page 1 of 2

PAGE TWO

CV 02-1954-PHX-MHM

March 20, 2008

The Court DIRECTS each side to submit a proposed order regarding analytical dissection by April 3, 2008. Specifically, the proposed orders should address whether each alleged similarity, both literal and non-literal, constitutes an unprotectable idea or a potentially protectable expression. The proposed orders should then address the relevant limiting doctrines with respect to the potentially protectable elements in the context of the particular medium involved through the eyes of an ordinary consumer. In addition, the proposed orders should consider whether the combination of any unprotectable similarities warrants protection. Having dissected the alleged similarities, the proposed orders should decide whether the work is entitled to "broad" or "thin" protection; and depending on the degree of protection, the proposed orders should discuss the appropriate standard, i.e. substantially similar or virtually identical, for a subjective comparison of the works to determine whether, as a whole, they are sufficiently similar to support a finding of illicit copying. In determining the degree of protection, the proposed orders should address whether the presence of any protectable elements (or protectable combination of unprotectable elements) significantly alter (quantitatively and/or qualitatively) the works in suit as a whole. The proposed orders should address that question in both the affirmative and the negative, i.e., if "yes," then whether the allegedly infringing works, viewed as a whole, are substantially similar to the copyrighted work, and if "no," then whether the allegedly infringing works, viewed as a whole, are virtually identical to the copyrighted work. If the Court deems it necessary, the Court will schedule oral argument before making a final determination on analytical dissection. Therefore, IT IS ORDERED denying without prejudice the Joint Parties Partial Motion for Summary Judgment [548] with leave to refile after the Court rules on the issue of analytical dissection. Time in Court: 2 hrs, 40 mins

Case 2:02-cv-01954-MHM

Document 595

Filed 03/20/2008

Page 2 of 2