Rossi vs. Darden developments - Part 2

  • Now we know why Dewey is nervous. The law consulting bill will increase, the chances for IH to win the case seem to vanish away ...


    I have briefly reviewed document 90, the third party (Penon, Johnson, Bass, Fabiani) answer to IH counter claims and have listed a few remarks.


    They did not deny that JMP was a shell company with no production, no ties to other "parent" companies nor used any of the heat. The answer stated it "did not matter" and that it was IH duty to prove the claim.


    They did not deny that Bass had no real technical job, but again, that it "did not matter".


    They did not deny that Johnson had presented JMP to IH as a real company, divested from Rossi, himself or others connected, but that "it did not matter". Again, asking for proof from IH.


    They did not deny that "false requests" for invoices were made, but again, stating it "did not matter" and was not fraud to do so.


    and so on...


    Not once, did the answer provide any evidence that the counter claims from IH were wrong. They only stated legal arguments that the claims "did not matter" or did not constitute fraud.


    There was no evidence provided to support JMP was a real company, producing product or used heat.
    There was no evidence provided showing that Penon made measurements, recorded data or even was at the plant.
    There was no evidence provided that the invoices for heat were accurate, from any type of measurement even real.
    There was no evidence provided that the test was approved by IH as a GPT.


    Would not the best defense against the claim that JMP was a fake company was simply to provide some production data, some receipts
    of sales of product? A simple thing like that would have nailed it, but alas, nothing provided!


    Would not the best defense against Bass being a "make believe" position, simply provide some reports on work he did? This would nail
    it!


    Would not the best defense against the "fake invoices" be presenting the records of the production machinery that used the heat, showing
    the input specifications of the heat required to run them? This would nail it!


    No, not a single piece of evidence was given to show that IH claims were wrong, but only statements that "it did not matter"!
    Why not provide evidence?


    Hardly the case that IH chances of winning are "vanishing away"!
    Wyttenbach, perhaps you could list some specific points from this document that are so convincing that IH case is vanishing?
    Be specific now, with reasoning, not just a one sentence post without substance. I do not mind reading more than one sentence!


    My take on the answer is that they are stating.... that we do not deny the factual claims of IH but simply deny that those actions constitute fraud in the legal sense. ?(

  • Just a reminder (my understanding only) that motions to dismiss in US federal law deal only with points of law and do not generally bring in evidence to support or refute claims that have already been made. They're dealing with counterfactuals: even if such-and-such happened, such-and-such law would still not apply, etc. The party submitting a motion to dismiss assumes at the outset that all of the claims made against its clients are true. With this in mind, an apparent admission in a motion to dismiss will not be incriminating.

  • @Bob


    I see just the opposite in the answer. Leonardo/Rossi deny, deny, deny...


    Edit: I see you were referring to the third party motion to dismiss. I haven't reviewed that yet, but will. In any case, Leonardo/Rossi generally deny the allegations.


    77. JMP’s role in the scheme magnified when JMP started sending
    falsified invoices to Industrial Heat stating the amount of energy or
    steam JMP was purportedly receiving and using from the Plant during a
    given month. A selection of the invoices is attached hereto as Exhibit
    18.


    0029-18_exhibit_18 (JMP invoice requests)


    77. Plaintiffs deny the allegations contained in Paragraph 77 of the Counterclaim and demand strict proof thereof.


    78. JMP’s role further intensified when it, along with Leonardo,
    Rossi, Johnson and Fabiani went so far as to have Bass pose as Director
    of Engineering for JMP. Leonardo, Rossi, JMP, Johnson and Fabiani
    enlisted Bass to pretend to be a JMP employee serving as its Director of
    Engineering to make JMP appear to be a real manufacturing company that
    would need a Director of Engineering and to create a person with whom
    they would allegedly interact on technical issues involving JMP’s
    non-existent operations and operational needs.


    78. Plaintiffs deny the allegations contained in Paragraph 78 of the Counterclaim and demand strict proof thereof.


    79. They even had Bass meet with Industrial Heat at JMP’s Doral
    facility and express JMP’s satisfaction with the steam power JMP was
    receiving from the Plant and using to run its manufacturing operations.
    Attached as Exhibit 20 is a copy of the business card provided by Bass
    representing himself to be JMP’s “Director of Engineering.” Bass also
    met with others, falsely claiming JMP was using steam from the Plant in a
    secretive manufacturing process. All the while, JMP, Leonardo, Rossi,
    Johnson, Fabiani and Bass knew that there was no secretive manufacturing
    process taking place and JMP had no real use for the steam power. JMP,
    Leonardo, Rossi, Johnson, Fabiani and Bass’ unconscionable and deceptive
    practices are further evidence that the testing in Miami was nothing
    but a sham designed to create the illusions that the Plant performed at
    levels that could satisfy Guaranteed Performance and that the prior
    Validation testing was valid.


    0029-20_exhibit_20 (or see a reduced resolution copy)


    79. Plaintiffs admit that Mr. James Bass met with IH at JMP’s
    Doral facility and that a copy of Mr. Bass’ business card is attached
    to the Counterclaim. Plaintiff denies the remaining allegations
    contained in Paragraph 79 of the Counterclaim and demands strict proof
    thereof. 80. Plaintiffs lack sufficient knowledge to admit or deny the
    allegations contained in Paragraph 80 of the Counterclaim therefore deny
    the same and demand strict proof thereof.


    83. Leonardo,
    Rossi, JMP, Johnson, USQL, Fabiani, and Bass also restricted access to
    the JMP area at the Doral location, claiming that there was a secretive
    manufacturing process being conducted there, when in fact it was simply
    recycling steam from the Plant and sending it back to the Plant as
    water.


    83. Plaintiffs deny the allegations contained in Paragraph 83 of the Counterclaim and demand strict proof thereof.


    84. Fabiani, USQL and Penon also played critical roles in the scheme
    to hide the fact that the Plant does not perform up to the standards set
    forth in the License Agreement.


    84. Plaintiffs deny the allegations contained in Paragraph 84 of the Counterclaim and demand strict proof thereof


    141. As described in greater detail above, Rossi, Leonardo, Johnson,
    JMP, Penon, Fabiani, USQL, and Bass (the “FDUTPA Defendants”) were all
    engaged in a common scheme against Counter-Plaintiffs.


    141. Plaintiffs deny the allegations contained in Paragraph 141 of the Counterclaim and demand strict proof thereof.


    146. In furtherance of this scheme, the FDUTPA Defendants engaged in
    the unconscionable, unfair, and deceptive acts and practices described
    above, including:


    a. Deceiving Counter-Plaintiffs about
    JMP, the operations of JMP, the supposed role of Bass, and the reasons
    for JMP wanting to use the steam power that could be generated by the
    Plant.


    b. Deceiving Counter-Plaintiffs as to the reasons for wanting to move the Plant from North Carolina to Florida.


    c. Manipulating the operation of the Plant and the measurements of the
    Plant’s operations to create the false impression and appearance that it
    was producing a COP far in excess of the COP it was in fact achieving.


    d. Providing false information to Counter-Plaintiffs as to the operation
    of the Plant and the measurements of the Plant’s operations.


    e. Refusing to provide other information properly requested by Counter-
    Plaintiffs, and to which Counter-Plaintiffs were entitled pursuant to
    the License Agreement, the Term Sheet, the USQL Agreement, and/or the
    nature of the purportedly (but in fact, not) independent work being done
    by Penon.


    f. Preventing or blocking Counter-Plaintiffs from obtaining truthful
    information about the Plant’s operations, the measurements of those
    operations, the role of JMP, the use by JMP of steam provided by the
    Plant, the role of Penon, or the bases for expenses or costs charged to
    Counter-Plaintiffs.


    g. Charging Counter-Plaintiffs for services, expenses, and equipment
    that were purportedly being used either for the benefit of, and to
    further the goals of, Counter-Plaintiffs when in fact no such services,
    expenses, or equipment were being used for Counter-Plaintiffs’ benefit.


    146. Plaintiffs deny the allegations contained in Paragraph 146 of the Counterclaim and demand strict proof thereof.

  • Eric,


    While that may be true up to a certain point, I don't think it will be missed by the court that 3rd Party Defendants are arguing it does not matter if what IH alleges, and provides evidence of, is true. And from my reading that is exactly what they are arguing.


    Fortunately, we here have a much simpler job in sorting this out than the courts. Even the remaining Rossi supporters have said if Rossi/Johnson are proven to have lied about JMP's ownership and operations, than they would abandon Rossi. And few could read this latest and come away convinced JMP was a legitimate company formed in the UK, affiliated with Johnson Matthey, with a real product and a need for the steam....well maybe Wytennbach could. :)

  • Quote

    Now we know why Dewey is nervous. The law consulting bill will increase, the chances for IH to win the case seem to vanish away ...They (IH) urgently have to find a way to proove that the (their!!) machine in Doral doesn't work!


    That's Bass ackwards. Rossi needs to prove his machine works. He's the one who got paid and who is demanding more money on the basis that the ecats work. He has to prove it. Lots of luck with that!


    You can only blow so much smoke up the judge's ... uh... robes, before you get messed up.

  • I don't think it will be missed by the court that 3rd Party Defendants are arguing it does not matter if what IH alleges, and provides evidence of, is true.


    My point was that this is the essence of a motion to dismiss. Anytime a party files a motion to dismiss, this is exactly what they're doing. Since a motion to dismiss is a routine filing, it can't be incriminating.


    ETA: per Bob's point, below, contradicting evidence that has already been submitted to the docket can also be referred to in a motion to dismiss.

  • Quote from Shane D.: “I don't think it will be missed by the court that 3rd Party Defendants are arguing it does not matter if what IH alleges, and provides evidence of, is true.”
    My point was that this is the essence of a motion to dismiss. Anytime…


    Well, I wish Abd was here! :)


    My understanding is in partial agreement with Eric Walker. That this point is not meant to provide or present all evidence. However, the judge can review the case at this point and dismiss it if it found lacking of reasonable evidence. Notice that IH provided a certain amount (probably not all) evidence in their answer, so the judge could make a determination. Not just from the legal argument side, but the factual side as well. Rossi or the Third Party answer provides NO evidence of any kind. Only legal posturing.


    That may be enough. but I doubt it. Again, not a lawyer, but I think it is a progressive activity. 1st filings are made with just "accusations", probably very little evidence. Then answers are given repudiating the allegations and some evidence is normally provided, other than "we deny". Motions to dismiss are the 3rd step and more evidence has to be given to justify the dismissal. This can be legal argument or evidence. So far we have seen both legal and evidence from the IH camp while the Rossi camp has provided no evidence that I have seen.


    The third party asked for dismissal of a suit brought on by IH. IH provided some evidence as to their fraud case. The answer to that suit was all legal wrangling where simple evidence provided could have nailed the dismissal. I.E. IH stated that JMP was a fraudulent company. If they responded "here is documents showing production or connection with a parent company" that would clearly dismiss the fraud charge. They did nothing to provide the judge to dismiss the charge other than "we deny". My personal opinion is that they had no evidence.


    My opinion only. :huh:

  • I see just the opposite in the answer. Leonardo/Rossi deny, deny, deny...


    Yes, it is two different answers. However, Rossi / Leonardo did deny, deny. It is important to see that the Third Party did not deny!
    If they did and it was proven that they knew about fraud, they might be in trouble with filing false statements! Rossi is already in knee deep, but they
    are not. So they argued only from the legal point which has no ramifications. I find it very interesting that they did not present any claim that
    the IH claims were false! Protecting their posterior? ^^


    Bob


    It is important to understand that document 90 is not a third party answer--it is a third party motion to dismiss. This is not the time or place for the third party defendants to admit or deny allegations.


    I agree this was a motion to dismiss.
    That means it IS time to provide evidence so the judge can "judge"! A motion to dismiss will only succeed if the defendant gives the judge enough evidence that the suit is either legally invalid (legal argument citing other precedents) or factual based upon evidence. This motion contained only "it does not matter" which will not win the motion at all and some legal argument as to what constitutes fraud. They could have easily had some dismissals by providing small but clear evidence such as JM Products was a "real" company. Or that Bass actually DID some work.
    Nothing was presented and this motion will almost certainly fail. (In my admittedly uneducated in law opinion)

  • "Lastly, the purported hiring of a fake engineer and restriction of access to JMP’s facility and operation
    are also not deceptive or unfair because pursuant to the Term Sheet, JMP, Johnson,
    and Bass did not have a business relationship with Counter-Plaintiffs for anything other than the
    rental of the Plant (in fact, pursuant to the Term Sheet, JMP, Johnson, and Bass were not even
    allowed access to the Plant) and access to JMP’s facility or operation was never promised or required."


    So the defense against fraud is that any amount of deception is permissible so long as there is no contractual violation. I don't think that will stand up in Court!


    What is interesting here is that there is no attempt to deny that JMP had no use for the energy supplied and consequently they will need to explain why they paid for it if not as part of a conspiracy to defraud.

  • That means it IS time to provide evidence so the judge can "judge"!


    The only evidence admissible in a motion to dismiss is evidence already found in an earlier document. A motion to dismiss looks at questions of law and does not deny allegations by introducing new, contradicting evidence.

  • That's Bass ackwards. Rossi needs to prove his machine works. He's the one who got paid and who is demanding more money on the basis that the ecats work. He has to prove it. Lots of luck with that!


    You can only blow so much smoke up the judge's ... uh... robes, before you get messed up.




    Rossi doesn't need to prove his machine works. Rossi has to fulfill his side of the licence contract. The E-Cat IP has actually been "validated" by the ERV already and IH paid its $10 million.


    The 1 year test wasn't about proving the E-cat works, but about demonstrating a certain level of performance over a period of time. Looks like the ERV validated that part too.


    There's no clause in the contract about deciding after the fact that the ERV is incompetent (who gets to decide that anyway?), and IH doesn't seem to have proof of some sort of conspiracy/fraud..


    The point where IH had the opportunity to question the ERV was when the $10 million was in escrow. Why did they not do their due diligence in that crucial moment?



    Now IH is trying to find loopholes to get out of the $89 million payment:


    1) IH claims the 1 year test time frame got changed without AEG signature, but the contract says "such time period may be extended by the Company in its sole discretion"


    2) IH (IIRC) claims the plant was not the original one, but the contract says Rossi can make repairs, alterations, adjustments to the plant in order to achieve the Guaranteed Performance.


    3) IH can claim that Rossi's test wasn't the actual guaranteed performance test, but nowhere does the contract say that Rossi needs permission to start the test.


    All we need for the Guaranteed Performance to be deemed achieved is a written confirmation by the ERV. Rossi doesn't need to prove anything else about his machine.



    At least that's my latest reread of the licence agreement. I am obviously not a lawyer.
    http://www.sifferkoll.se/siffe…sdce-16-21199__0001.2.pdf

  • [quote=we need for the Guaranteed Performance to be deemed achieved is a written confirmation by the ERV. Rossi doesn't need to prove anything else about his machine.
    …[/quote]


    Where is Penon (ERV)? How can Rossi prove the report without some verification/ testimony by Penon? Without him, then what does Rossi have? For some reason Penon seems to be in hiding. You have to ask yourself why would he hide.

  • They did not deny that JMP was a shell company with no production, no ties to other "parent" companies nor used any of the heat. The answer stated it "did not matter" and that it was IH duty to prove the claim.



    Bob : Law business is easy if you know the rules: There is nothing A.R. must deny. If it is sufficient to show that the counter party has no evidence, then this is the safe way to go.


    Document 90 is a very detailed and in-depth worded listing of IH failures to show any evidence of their claims. To counter this, they (IH) will have to spend some additional 100k $ or simple declare bankruptcy...


    Disclaimer: I do absolutely not believe that A.R. deserves the additional 89mio.$, unless there is an existing proof, that the machine worked as confirmed by an independent authority ...


    But law sometimes works differently ...

  • LC - getting a judge and jury to award Rossi $89M is going to require more than a paperwork trick.Then there is the recent unpleasantness that Rossi still has to face around the fake customer, the glorious "factory" pictures, the IR data, reps and warrants, test and measurement deception, etc..., etc....


    I moved your quote here as you replied in the wrong thread.



    I am not a lawyer, but to me the words in a contract is more than paperwork trick.


    Now if IH manages to uncover fraud, that could change everything.



    Does the contract mention the need for a customer?


    Who is responsible for confirming the Guaranteed Performance, Penon or Dewey Weaver?

  • [quote='LENR Calender',Who is responsible for confirming the Guaranteed Performance, Penon or Dewey Weaver? …[/quote]



    Who is responsible for confirming that what was done in FL was an agreed to Guaranteed Performance test and not just a test of power delivered to a "commercial customer making some product"? Who is responsible for confirming that the ERV report and all its data was indeed measured and approved by the ERV?(i.e. where is Penon?) - IH or Rossi?

  • The only evidence admissible in a motion to dismiss is evidence already found in an earlier document. A motion to dismiss looks at questions of law and does not deny allegations by introducing new, contradicting evidence.


    Thank you for your clarification. However, did not IH present evidence in their motion to dismiss Rossi's suit? I could very well be incorrect on this and there is now 90 documents submitted! Keeping this straight would take a full time job.


    Suits, counter suits, motions to dismiss, answers, etc. As I have stated before, I would never choose the legal profession as a career! I will stick to engineering. (Although with many government regulations, sometimes even engineering is becoming a legal profession! :S )

  • It seems that this legal stuff is easy to misunderstand: though Wyttenbach above goes beyond the call of duty in doing so.


    (1) There are (effectively, in terms of these documents) three separate actions:
    (a) Rossi vs IH (very weak, it seems)
    (b) IH vs Rossi (could be strong, but much uncertainty because of information not revealed)
    (c) IH vs third parties Fabiani, Bass, Johnson (weak, it seems)


    Then, the documents we see are either Motions to deny (MOTD), or initial complaints or answers to them. the compalints and answers contain evidence (in fact they must contain a rough overview of the evidential arguments, though not necessarily all the evidence that will later be unearthed). The MOTDs contain only legal arguments and cannot address facts (except to say that they not claimed, which is one of the possible legal arguments).


    Wyttenbach gets (a) and (c) confused when he thinks this MOTD has any direct relevance to (a). It might have indirect evidence only inasfar as it gives an indication of the likely future evidence from the third parties, and it does not have much even of that since an MOTD contains legal arguments not facts.


    So, basically, the MOTDs have very little interest unless you want to know which claims (on purely legal grounds, facts irrelevant) are likley to be dismissed.


    However the MOTDs (if upheld) can cause the case to be revised and strengthened so they resulkt, down the road, in juicy new facts emerging.


    Bob, in an MOTD denying an allegation would do no good.


    All they can do at this stage in the legal process is to argue that even if all facts alleged are true, the complaint is vacuous and so must be dismissed. But it is true that they cannot lie so there might be some slight info to emerge. I actually think that the IH case at the moment against these 3rd parties is weak on purely legal grounds. They have not made much of a case yet. The strong third party case would be against Penon, who seems to have gone to ground, and of course there is a strong case against Rossi himself. But who can tell? I guess IH reckon if they can get the 3rd parties involved they will spill beans pretty effectively, so these MOTDs actually matter.


    Eric will correct me if I've got details wrong in this summary from memory (am I right that the MOTDs are answered only by the complaints being revised, which happens after the judge has ruled on the MOTDs? Or is the order different, so that the judge rules only after MOTD and revised complaint?)

  • I guess IH reckon if they can get the 3rd parties involved they will spill beans pretty effectively, so these MOTDs actually matter.


    I agree. I would assume that IH is not really that interested in going after Bass and possibly Fabiani. They probably are filing this with the intent of adding enough concern to them that they might turn friendly witness. After all what would they have to lose if they did? They might go after Johnson a bit more, but who knows. They are probably trying to set the table to entice the third parties to "come clean" and thus strengthen the IH defense.


    But who knows?