Posts by woodworker

Quote from [email protected]

Let's say that you've got such a fancy-dancy lawnmower that you both hire an agreed third party person to write the report on whether the lawn was mowed. The 3rd party writes a favorable ERV report saying he thinks the lawn was mowed. How is the jury going to process that fact? Earlier you said you didn't even think the 3rd party report would be allowed into evidence. So if Rossi mentions the ERV report, does the judge declare a mistrial or tell the jury to 'disregard that remark'. If I were on the jury I'd have a lot of trouble disregarding that kind of remark.

"Earlier you said you didn't even think the 3rd party report would be allowed into evidence." OBJECTION, mischaracterizes earlier testimony - I said it was possible that it might not be allowed, not that it wouldn't be allowed.

As to: "So if Rossi mentions the ERV report, does the judge declare a mistrial or tell the jury to 'disregard that remark'.
If I were on the jury I'd have a lot of trouble disregarding that kind of remark."

Two scenarios: First: If the judge decides that the ERV is not admissible, Rossi might/will try to bring it up at least once. Instant objection by JD, before Rossi gets 10 words out of his mouth. Judge warns him about it. Rossi brings it up again, instant objection by JD, jury is excused and Judge tears Rossi a new fecal outlet and warns him that if he brings it up again he will either need to bring a tooth brush to court (i.e., contempt) or terminating sanctions.

Second scenario: JD doesn't object and then crosses Rossi on the report: Where is the author of the report, why isn't he here to testify, isn't the reason that he is not here to testify is because he knows the report is bogus, how can the report be truthful if the customer was fake and the invoices were faked, etc. etc.

I saw a comment somewhere about three points I think worth mentioning: the first is how expensive this trial must be, both in cost and potential damages. In reality, not that expensive. Potential damages, maybe 100 million - courts deal with bigger financial cases all the time. Cost of litigating, maybe a couple of million, again, in reality not that much.

Second, how complicated this case is and how could the judge/jury possibly understand it. Really not all that complicated. This is a contract dispute and federal courts in particular have lots of experience in dealing with much more complicated cases - think prosecuting money laundering related to the mob or terrorists, think patent cases where Appel or Microsoft or IBM are involved. And juries, despite their flaws, at the end of the day do a pretty good job of getting to the right answer.

Third: oops, I forgot (channeling that "esteemed" Rick Perry, our new Secretary of the Department of Energy, one of the departments he wanted to eliminate).

Quote from sigmoidal

While that is true, I think it is important for woodworker to note that the ruling Agreement (aka 2nd Amended Contract) explicitly specifies the '6 cylinder' unit for the 1 year performance test. That unit is not the unit used in Florida: the 6 cylinder unit is currently and always has been in North Carolina. It uses oil as the heat transfer fluid instead of water. It was never part of any 1 year performance test. The 1MW plant is a completely separate device from the 6 cylinder unit. The only substantial similarity is that both devices are housed in shipping containers. The 1MW device is the unit that IH purchased for 1.5 million from Rossi after a 23.5 hour test in Italy. Rossi proposed to IH to rent that unit to the (fake) Doral customer for 2 years and the written agreement for that is named the Term Sheet. The Term Sheet makes no mention of any General Performance Test - it is explicitly only a Rental Agreement. IH agreed to ship that 1MW (water/steam plant) to FL and that is what Rossi is claiming met General Performance Test (GPT) performance.

My understanding is that this fact alone (that the 1MW unit 'tested' for 1 year in FL is not the unit specified in the agreement) is grounds for dismissal of Rossi's $89M performance Breach of Contract claim. But it centers on the question of how far can you 'stretch' estoppel. Rossi seems to be hoping that swapping units is OK via estoppel. Since I am not a lawyer, it would be great if woodworker weighs in, given that both parties agree that the 6 cylinder unit specified in the 2nd Amended Contract (signed by Rossi and Darden but not Ampenergo) was never tested for 1 year performance by Rossi, and that the contract explicitly states that any changes to the agreement must be made in writing and agreed to by all parties (and this change of GPT hardware was never done or even proposed by any party).

Thoughts, woodworker?

I haven't read the agreement or the test parameters in enough detail to say whether or not the Florida test, if legitimate, would have satisfied the conditions precedent. I do believe that if the Florida test legitimately worked IH would have gladly paid the additional $89 million while skipping and dancing to show to investors. And none of us would be here right now arguing about it. But it didn't work (more on that in a moment). Someone above commented that the Agreement didn't require a customer. True, but once Rossi introduced that factor, and introduced to prove that the test worked, Rossi can't now say "ignore that the customer was fake."

How do I know it didn't work - just a few points: (1) fake customer and fake invoices; (2) Rossi created the fake customer, etc. because he knew it didn't work; (3) Rossi's inability to replicate; (4) Penon taking a hike; and (5) no expert stepping up for Rossi giving an expert opinion that it works/worked.

Quote from SSC

Well, it is right to have hope for new sources of clean and cheap energy ..... which is why I was interested in E-Cat. As a lawyer (you, not me), though, I wonder why you have already made such a verdict. Do not you think Rossi can still have a lot to say about the whole affair? Do not you think that some evidence that you find obvious may turn out to be different when Rossi will explain it to the jury? I thought your class of workers was usually more cautious about these issues.

SSC, how does Rossi explain the fake company and fake invoices? Attorneys generally are cautious, but I am a fairly cantankerous old coot.

Quote from SSC

The timing is a bit suspicious indeed.... but it is said that thinking badly is a sin!

SSC: If you want to say that I am lying when I say I don't have a dog in this fight, say so and don't be a coward. I repeat, I have no dog in this fight, I have no financial interest in it and I have no personal or business relationships with any of the parties, their counsel or anyone on this board (at least as far as I know, as most of the people here post anonymously). But, if you decide you want to say I am lying, please note that statement could be considered defamatory, particularly as I have identified myself, and I can assure you that this board and your ISP will gladly turn over you real identity pursuant to a subpoena. So, at the risk of violating the norms of this board, fold it five ways and shove it where the moon don't shine.

Quote from nobody

Woodworker, your argument is concise, clear, reasoned. Thanks.

Do you put any weight behind the argument that IH actively pimped Rossi's technology to investors during the time period IH claims now to be unsure the tech even worked, shows IH isn't beyond stretching the truth for profit? IH also filed a patent on Rossi's technology in that time period when they could not replicate LENR, much less the patent, which patenting Rossi claims was a breach of contract (this is my memory of Ross's claim, am too lazy to find you a source). Will Rossi try to make the case that IH are the frauds? What is Rossi's best case?

Firstly, IH may have believed/wanted/hoped that Rossi really had something great, so going out and pitching investors is not abnormal, unusual or necessarily a sign of bad faith. Just like many poker players, investors will chase a bad hand, putting more money into the pot in hopes of buying a winner. I know that when I represented companies raising money, ALL of the prospectuses contained many many risk factors pointing out that the technology was unproven, may not be patentable, may not be commercially feasible, etc., etc.

Whether or not IH filed a patent, so what? If the technology works, they have protected themselves, if it doesn't all they have done is paid for orthodontia for the patent attorney's children. See above re: risk factors.

Of course Rossi will claim that IH are frauds: when the law is in you favor, you argue the law, when the facts are in you favor, you argue the facts, when neither the law nor the facts are in your favor, you argue bullshit. Also, Rossi's best case IMHO.

But how did IH's alleged fraud prevent Rossi from satisfying the conditions precedent to their obligations to pay? Their alleged fraud did not cause Rossi to form a fake company, to cause false invoices to be created, etc.

Consider a very simple contract:

I hire you to competently mow my lawn within the next five business day and I will pay you $100. You mow my lawn, do a competent job and do it within the stated time. Then I owe you $100.

Now, let's say you don't mow my lawn, but say that you couldn't because I constantly ran the sprinklers the entire time. Okay, your performance is excused because I prevented you from performing, so I still owe you $100.

Now, let's say that you don't mow my lawn but still say I owe you $100, which is sort of the case we have here. ROSSI HAS THE BURDEN OF PROOF THAT HE MOWED MY LAWN. Did he? Where is the evidence? I see evidence that he pretended to mow my lawn, yes he had a lawnmower, but it was electric and he had no extension cord or it had no blades. And his proof that he mowed my lawn is that he hired someone, a friend and colleague of his, to say that he had hauled away bags and bags of cuttings, although he had no means of removing those cuttings and the trash guys say they never picked up any such trash. Oh, and my lawn is an inch taller that it was a week ago.

Lastly, let's say that you hire someone else to mow my lawn on your behalf, but your subcontractor doesn't perform. I don't owe you anything.

Quote from THHuxleynew

Kevin.

I can see how you get your weird views. Ecat-world is not a reliable legal information source - nor vortex. Try reading the Court documents for sworn testimony from the principals.

The question is not whether IH rejected it. It is whether they ever accepted it - your onus to find this acceptance which you can be certain, if it existed, Rossi will reply upon in Court. Therefore it will be in the mountains of Discovery evidence and also highlighted in the Rossi MSJ (to make your job searching a lot easier - reading the entire MSJ is quite possible to those interested).

The not-so-subtle conflation of accepted and never rejected, which you make in your post above, is typical of Rossi's lawyers who continually try to deny matters of fact by stating counterfactuals which are apparently in contradiction but actually not so. Abd's site has some insightful and very detailed, with references, examples of this. Abd is disliked by many as a pompous self-important windbag (a bit like me) - but his patience at following up this stuff is unequalled - and he provides exact quotes and references to source material (that is Court documents, not vortex or ecat-world) so you can check as you read. I recommend that to you.

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Quote from Zeus46

Woodworker, is there any validity to the argument that because the 'fake' companies which Rossi set up are separate legal entities, these technically did satisfy the needs of the agreement?

To clarify, say I'm the sole director of two companies, and the companies sometimes contract/invoice and communicate with each other, despite the fact it's really all just 'me' writing letters to 'myself'. Assuming I'm not doing this for tax avoidance purposes, everything is legal/standard practice?

I hadn't read this bit yet:

Is that true? If so I guess it makes the above a moot point.

Fo' sure

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Just to point something out: What is the purpose behind you forming separate legal entities that don't actually conduct business - to defraud the counterparty, in this case IH. FRAUD and having formed the separate legal entities won't protect you.

Quote from Eric Walker

Great having you join this thread, Howard. Thank you for chiming in.

Can you give us a preview of what will happen during the trial from our perspective as remote observers? What of interest will be added to the docket during or after the trial?

If you are asking about how the trial proceeds, my prediction would be in a fairly normal and even, to a large degree, boring process.

Rossi wants an additional 89 million dollars. In order to get that, he needs to prove, by a preponderance of the evidence, that he satisfied the conditions precedent under the Rossi/IH agreement (the “Agreement”) to IH’s obligations to pay those monies. To do that he will need to establish what those conditions precedent were, e.g., a satisfactory performance over a certain number of days, that he satisfied those conditions precedent and that, despite such satisfaction of the conditions precedent, IH failed to pay (this last step, that IH didn’t pay is not disputed).

So Rossi will put on witnesses to testify to (1) the terms of the Agreement and (2) that Rossi satisfied the requisite conditions precedent. After each Rossi witness testifies on direct (examination by the party calling that witness), JD will cross-examine those witnesses in an attempt to cast doubt on their credibility and to destroy their testimony.

As to what are the terms of the Agreement, I expect some fighting over whether or not the Florida test itself is the test required by the Agreement, but at the end of the day I don't think it will matter, i.e., that whatever the terms and conditions precedent were, Rossi didn't satisfy them. I haven’t reviewed the documents in enough detail to predict how that issue will play out other than to say that the Florida test, if not completely bogus, might have been considered to be the test required by the Agreement. However, as the Florida test was bogus, e.g., fake customer, fake invoices, sketchy “performance” reports, I don’t think the Florida test will be found to have satisfied the test requirements set forth in the Agreement.

If the test requirements / conditions precedent in the Agreement were not satisfied, then Rossi is not entitled to the additional monies.

It must be noted who has the burden of proof on this issue. Rossi has the burden of proof on this issue not IH. Rossi has to prove, by a preponderance of evidence admitted at trial (not the "evidence" we all independently know somehow), that the Florida test satisfied the conditions precedent to IH’s obligation to pay (or that his non-performance was excused because IH stopped him from performing, which I won’t discuss here because it wasn’t).

It is important to realize that IH, on the issue of whether they owe the additional 89 million dollars, doesn’t have to prove fraud, they don’t have to prove anything. All they have to do on this particular issue is to cast enough doubt on Rossi’s claims that he has satisfied the conditions precedent to IH’s obligations to pay money. Again, Rossi has the burden of proof on this issue not IH. Given the evidence that the Florida test was bogus, IMHO I don’t think Rossi has a prayer in hell of winning on this issue.

What evidence is Rossi going to submit to establish that he satisfied the conditions precedent? The parties have not submitted their witness lists so we don’t know who Rossi is going to call, but let’s think about that.

Rossi will want to submit the ERV, but Penon, the person who prepared that report, is “unavailable” by his own decision. I am not sure that the report even gets admitted. And if admitted and then shown to be total bs and unreliable, there goes Rossi's proof of satisfaction of the conditions precedent.

Johnson? Does Rossi put Johnson on the stand to testify as to the terms of the Agreement and/or whether or not the conditions precedent were satisfied? Just image the cross-examination by JD: Mr. Johnson, isn’t it true that you stated in a letter to IH that neither you, Rossi or anyone else involved in the project had any interest or involvement in the fake customer? Mr. Johnson, isn’t it true that you were responsible for the formation of the fake customer, that Rossi controlled the fake customer and that you (IIRC) secretary and accountant were involved the perpetuation of the fraud about the fake customer? Mr. Johnson, were you lying then or are you lying now? Putting Johnson on the stand as a witness poses YUUGE risks.

Fabiani? Is he available or also absent?

Rossi? I think that Rossi will attempt to add some razz matazz to his arguments, i.e., to establish that if only people would believe in him and not question his brilliance, he would have solved all the world's energy problems with a wave of his hands.

Rossi testifying himself will be interesting. I predict that he will go off on lots of detours and tangents and it will be interesting to see how JD responds. Rossi may bring up lots of stuff that may not be directly relevant or admissible, e.g., his "sales" of the ecat to other parties as evidence of his brilliance and that they work. JD could object that this is not relevant and therefore not admissible or not object or JD could allow that testimony and then question him on cross about these other "sales" and whether or not they really exist. Such questions/topics might not have been permitted on cross if Rossi hadn't brought them up on direct, but once he brings it up on direct, they are fair game on cross. As such, this could give JD more scope to go after Rossi's credibility on cross.

I have more thoughts, but need to feed myself, so this is all for now. Rocky Road ice cream awaits me.

Quote from SSC

Welcome Mr Appel. Just for curiosity, what leads a lawyer to read the LENR Forum? Are you interested in cold fusion or in general in alternative sources of energy? How did you find the dispute between IH and Rossi?

I don't recall what led me here. I may have run across a link on Quatloos or on one of the too numerous blogs I visit. My interest in CF is probably limited to the desire to see clean cheap energy, but I have no familiarity with any of the specific proposals to achieve that.

Quote from PeterMetz

I concur. Jurors may hold "facts" however they wish. They can completely ignore them or base the entire case on a single fact. They are instructed to rely on their gut to evaluate the facts of the case (based on my personal experience on a jury). Rossi has no credibility given his JMC ruse and his long history of specious business practices. If Jones Day executes correctly they will annihilate Rossi's credibility. Add to that Rossi's revolutionary claims of commerical performance of a revolutionary new energy source--we'll it's just too much. Short of a miracle disclosure, like a QuarkX powered smart phone, Rossi does not have a chance.

Still strange things can happen in a jury trial. Rossi supposedly has binders and binders of data backing up his case--maybe we'll see something from them but so far we've seen only an amateur attempt to defraud.

As usual I want to add that I am not a lawyer and have no personal or financial interest in this trial. My original interest was in the E-Cat as a new source of energy and my interest now is in seeing that justice is served.

A QuarkX powered smart phone would not be relevant to the issues of this case and as such would not be admissible. As to his binders and binders (shades of Romney), he better have turned them over to JD in discovery or they will be ruled inadmissible. Real trials are not like Perry Mason or even Law and Order, they have rules you have to follow: no surprise witnesses (with a very few exceptions), no surprise documents (ditto), you have to disclose your experts, their opinions and what they base their opinions on, you don't get to ask leading questions on direct (you do to a certain degree on cross) and stuff that is not relevant isn't going to be admitted, period. I look forward to daily reports from any boots on the ground, but I live in NorCal and have no interest in traveling, unless I am being paid to.

Quote from IH Fanboy

woodworker,

I enjoyed your analysis. You may be right. But if so, LENR will march on, and probably Rossi too.

I am not expressing any opinions or LENR or CF, I am merely saying that IMHO Rossi is fucked and justifiably so. Based on the admissible evidence (an important word and concept) proffered so far, he is a liar, a cheat and a conman (and if he thinks I am defaming him, remember, truth is an absolute defense).

Well, as I am already in the water, let's continue:

People have commented on the inevitability of an appeal: Well guess what, if you lose and want to appeal, then Federal Rule of Civil Procedure 62 requires you to post a bond for the amount of the judgement, plus costs. Here is a good link to an article on appellate bonds, prepared by those nasty folks at Jones Day, of course.

Also, for those of you who want to know who I am, my name is Howard Michael Appel, California state bar no. 158674. I post on and am a member of the The Fogbow and Quatloos, as well as too many to count woodworking forums.

http://www.jonesday.com/files/…_2008_The_Appeal_Bond.pdf

I am a noob to this site (sort of). I spent the last month or so catching up to this point and still have another 12 or so pages to fully catch up. I have held off replying/commenting on posts so far because I thought it best to wait to see if comments I might respond to had already been addressed. But I have to respond to Mr. A. Smith's comment "Deeply untypical. And whatever happens it will be appealed by one side or the other. That's when I expect to see rebuttal evidence, not before."

No disrespect to Mr. Smith, but this is total nonsense. I am not a scientist nor an engineer. I am an attorney who has practiced for over 25 years, including opposing Jones Day (a/k/a Jones Day, Night & Weekends for the amount of billable hours expected of their associates and Jone, Day, Reavis, Pogue & Satan, also by their associates). I started with a "small" firm called O'Melveny & Myers and then spent time with Hughes Hubbard & Reed before going inhouse.

First, absent EXTRAORDINARY circumstances, new evidence is not admissible upon appeals. Examples of extraordinary circumstances: proof of actual innocence in a death penalty case, and many times not even then. Civil case like this, with plenty of time before trial - ain't gonna happen.

Second, I have read many comments by scientists, engineers, etc. on what will happen at trial, would the trial be dismissed, etc., but shockingly few comments by lawyers. IMHO, Rossi is fucked. Jones Day is going to destroy any and all credibility that he has and will force him to say, under oath, that the "customer" never really existed, that he controlled the customer, etc., etc. This is a civil trial and Jones Day can force him to take the stand. Yes, Rossi could plead the 5th Amendment, but this is a civil trial not a criminal trial. In a criminal trial, pleading the 5th or not taking the stand cannot be held against a defendant, but in a civil trial the rules are different. When a witness or a party pleads the 5th in a civil trial, the judge will instruct the jury that they are entitled to draw all the negative inferences they want from that and Jones Day will take full advantage of that. It is not certain, but the judge may also allow Jones Day to introduce evidence of Rossi's prior alleged fraudulent acts, not to show that he is fraudulent this time, but to address his credibility, or lack thereof. Jones Day is going to (rightfully) crucify Rossi on the stand over the false invoices, the fake company, his history, etc.

And no IHFB, lawyers and even laypeople in the real world understand the difference between a natural person and a legal entity such as an LLC, corp or partnership and no, what Rossi did re the fake company is pure unadulterated fraud AND JONES DAY IS GOING TO HAMMER HIM.

I have not read all of the motions in limine yet, but I suspect that if Penon is not present in court that Jones Day will attack any introduction of reports made by him as hearsay and therefore as inadmissible. Hearsay is an out of court statement being introduced to prove the truth thereof, which is what the reports would be used for, to prove that Rossi had satisfied his contractual obligations. But there is nothing preventing Penon from testifying in person, except that he doesn't want to, so his reports could be excluded as hearsay. Now, while there are many exceptions to the hearsay rule, I don't see any that Jones Day couldn't beat.

As to the validity of the contract itself, I don't see any real chance of the court saying that no contract existed just because there may have been missing signatures. An agreement may be inferred by the conduct of the parties. However, what the terms of that agreement may still be subject to dispute, especially if the conduct of the parties differed substantially from the written agreement.

Last point for now, the dueling experts. Dueling experts may be discounted by juries to a degree, but jurors do listen to them. And in this case you don't have dueling experts. Read the court's order re: Wong's testimony (IIR his name correctly). He can testify, on direct by Rossi's lawyers, only that, if the equipment claimed by Rossi to be on the customer side was actually there (which equipment he didn't see any proof of), then something something. How, let's imagine the Jones Day cross-examination:

JD: Dr. Wong, do you any technical training in evaluating the operation of systems such as e-cat?

Wong: No.

JD: Dr. Wong, did you ever examine the e-cat in operation?

Wong: No.

JD: Dr. Wong, did you ever perform any analysis or examination of the technical workings of the e-cat or the customer side equipment (objection, compound question - rephrased as two separate questions)?

Wong: No.

JD: Dr. Wong, did you ever actually see the customer side equipment?

Wong: No.

JD: Dr. Wong, so would it be correct to say that, in rendering your opinion, you have relied entirely, completely and solely on the promise by Dr. Rossi that the customer side equipment was there? That you never verified it, that you never saw it, that you never spoke to anyone else who saw, etc., etc., etc.

Jones Day will make Wong's testimony look like dog crap. I would even consider not putting him on the stand if I were Rossi's counsel except for the fact that letting IH's expert testimony be unrebutted also kills Rossi.

Lastly, for real this time, Jones Day is going to have a field day with the Rossi witnesses. And no, I am not affiliated with any of the parties, their lawyers or anyone else in this fight, just a very amused observer.

I predict a bloodbath at trial.