SUSMAN GODFREY L.L.P.

SUSMAN GODFREY L.L.P. A REOISTERED LIMITED LIABILITY PARTNERSHIP 15TH FLOOR 560 LEXINGTON AVENUE NEW YORK, 0022-6828 5une 5100 1000 Louitiwia Smurr Mwt 096 Sizohl DI'MC/ pti July 12, 2011 Via Email Sony 5100 001 Mull Sinn The Honorable Anthony J. Carpinello JAMS 620 Eighth Avenue, 34th Floor New York, NY 10018 'June 950 Some 3800 1901 AYR.ue or me Smas 1201 Thum AVENUE LOS ANSE 7-0029 Mau. -3003 DIRECT DIAL FAX Re: FORTRESS VERF I I,I,C and FORTRESS VALUE RECOVERY vs. JEEPERS, INC. JAMS Ref. No.: 1425006537 Dear Judge Carpinello: Respondent, Counterclaimant and Third-Party Claimant Financial Trust Company, Inc. and Jeepers, Inc. ("FTC") submit this letter in advance of the call with Your Honor on July 13, 2011 to discuss the order of opening statements. All parties apparently agree that FTC should put on its evidentiary case first; the Fund has abandoned that role. The only dispute is whether FTC's opponents should be able to open first (the Fund) and last (the Zwim entities)—and presumably close too. Allowing the Fund and Zwirn to bookend FTC in this fashion makes no sense. The Fund provides no explanation for why it should maintain the right to open and close the case after having abandoned its role as plaintiff in every other facet of the litigation. The Fund is merely a declaratory judgment plaintiff. FTC is the real plaintiff, bearing the burden of proof on the critical issues, and thus realignment of the parties is fully justified. See, e.g., Saudi Basic India. Corp. v. Mobil, 2003 WL 25849476, at *2 (Del. Sup.) ("Similarly, the Court is not reluctant to realign the order of proof where a party resorts to a preemptive strike via declaratory judgment for the purpose of securing priority as to forum, when realignment makes clear the true posture of the case. Under the circumstances presented, the Court is compelled to I6I0768vI/Ol1585 EFTA01069752 The Honorable Anthony J. Carpinello July 12, 2011 Page 2 look beyond the pleadings and allocate the burden of proof to the party that must prove the ultimate issue at trial, ExxonMobil.") (attached as Exhibit A). As a result, FTC respectfully requests that it be permitted to open and close the case, and FTC will present its evidentiary case first. Sincerely, J etpit.L D 4.1464-adi) Stephen D. Susman cc: Brad S. Karp Allan Arffa John Siffert William O'Brien I610768v1/011585 EFTA01069753 EXHIBIT A EFTA01069754 Westtaw. Page 1 Not Reported in A.2d, 2003 WL 25849476 (Del.Super.) (Cite as: 2003 WL 25849476 (Del.Super.)) H Only the Westlaw citation is currently available. UNPUBLISHED OPINION. CHECK COURT RULES BEFORE CITING. This decision was reviewed by West editorial staff and not assigned editorial enhancements. Superior Court of Delaware, New Castle County. SAUDI BASIC INDUSTRIES CORPORATION, Plaintiff, v. MOBIL YANBU PETROCHEMICAL COMPANY, INC. and Exxon Chemical Arabia, Inc., Defendants. C.A. No. 00C-07-161-JRJ. Submitted: Dec. 19, 2002. Decided: Jan. 24, 2003. Upon Defendants' Motion to Realign the Order of Prooffor Trial Presentation-GRANTED. Donald E. Reid Esquire, Morris, Nichols, Arsht & Tunnel!, Wilmington, Delaware, Kenneth R. Adamo Esquire, Michael W. Vary, Esquire and Leozino Aaozzino. Esquire, Jones, Day, Reavis & Pogue, Cleveland, Ohio, Jeffrey W. Lorell, Esquire and Marc C. Sinner, Esquire, Saiber, Schlesinger, Satz & Gold- stein, LLC, Newark, New Jersey and Cheryl L. Farine, Esquire, Hudak, Shunk & Farine Co., L.P.A., Cuyahoga Falls, Ohio, for Plaintiff. William J. Wade Esquire, Richards, Layton & Fin- ger, Wilmington, Delaware, James W. Ouinn, Es- quire and David Lender Esquire, Weil, Gotshal & Manges, LLP, New York, New York, K.C. Johnson, Esquire, Exxon Mobil Corporation, Houston, Texas, for Defendants. OPINION JURDEN J. INTRODUCTION/BACKGROUND *1 The issue before this Court in the instant mo- tion is whether or not, in view of the facts of this case and the recognized rules of law and practice, re- alignment of the order of proof is appropriate. In simple terms, the main issue in this case is whether SABIC breached certain agreements with Mobil Yanbu Petrochemical Company, inc. and Exxon Chemical Arabia, Inc. (collectively, "Exxon- Mobil") by overcharging YANPET and KEMYA (The "Joint Ventures") for their use of Unipol® tech- nology.M The Court will not recite the facts underly- ing this dispute; they arc amply set forth in the volu- minous pleadings, and memoranda filed in support of this motion and the outstanding summary judgment motions. FN1. See Saudi Basic Indus. Corp. v. ExxonMobil Corp.. 194 F.Suon.2d 378. 385 (D.N.J.2002). As Judge Walls noted: "SABIC's complaint seeks declaratory relief ... solely on the issue of whether the royalty charges were proper under the joint venture agreements." Id. However, the procedural history leading up to this motion is critical to its determination. On July 24.2000, the plaintiff, Saudi Basic Industries Corp. ("SABIC") filed a declaratory judgment action against ExxonMobil in this Court. This filing oc- currcd one business day after the conclusion of me- diation in a related case pending in the United States District Court for the District of New Jersey. ExxonMobil alleges that SABIC wrongfully used information gleaned during that mediation, or settle- ment discussions, in violation of the parties express agreements, to file this suit "in a blatant attempt to gain a tactical advantage." EN-2 In short, ExxonMobil accuses SABIC of forum shopping in an effort to "avoid having the trier of fact in New Jersey hear about ... [SABIC's] improper overcharges...." E-2 FN2, Def.'s Mem. Law Supp. Mot. Realign Order Proof Trial Presentation at 3 [herein- after Def.'s Mem. Law]. FN3. Id. at 3, n. 4. In response to SABIC's declaratory judgment ac- tion. ExxonMobil filed counterclaims based on the alleged overcharges by SABIC including, inter alia, C 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. EFTA01069755 Page 2 Not Reported in A.2d, 2003 WL 25849476 (Del.Super.) (Cite as: 2003 WL 25849476 (Del.Super.)) claims for breach of contract, breach of fiduciary duty, unjust enrichment and promissory estoppel. In the motion presently before this Court, ExxonMobil asks the Court to "realign" the order of proof for trial presentation because ExxonMobil "bears the burden of proof on the ultimate issue for trial, and because realignment in this instance promotes the conserva- tion of judicial resources and lessens jury confusion." FN4. Def.'s Mem. Law at 5. DISCUSSION The parties agree that the trial judge has discre- tion in determining whether or not to depart from the usual order of proof at trial. M1 That discretion is broad.M According to Delaware Uniform Rule of Evidence 611(a), FNS. Hit Tr. (Dec. 19, 2002) at 115, 119. FN6. See Poe v. State, 624 A.2d 399. 403 (De1.1993); Brothers v. McKay 544 A.2d 265. 265 (De1.1988); Gaston v. State 234 A.2d 324. 325 (Del.1967); Baltimore & 0. K. Co. v. Hawk. 143 A. 27.31 (Del.1928). Control by court. The court shall exercise reason- able control over the mode and order of interrogat- ing witnesses and presenting evidence so as to (1) make the interrogation and presentation effective for the ascertainment of the truth, and (2) avoid needless consumption of time. FN7 DEL. UNIF. ft, EVID. 611(a). ExxonMobil's concerns about conserving judicial resources and lessening jury confusion are well grounded. Having presided over this complicated dispute for over 15 months, and having become very familiar with the salient facts and issues through nu- merous, hotly contested discovery disputes and ex- tensive motion practice, the Court fumly believes that realignment of the order of proof in this case would (a) result in a far more effective presentation "for the ascertainment of the truth," (b) "avoid need- less consumption of time," and (c) reduce the potential for juror confusion. ExxonMobil argues that, "although SABIC is technically the plaintiff by virtue of winning its race to the courthouse, SABIC's Amended ,Complaint is merely a compilation of de- fenses." 112 ExxonMobil correctly points out that: FN8. See Del. Unit R. Evid. 611(a). FN9, Def.'s Mem. Law at 7. *2 [r]egardless of what the caption reads, SABIC is in the position of traditional defendant, asserting that it acted correctly. ExxonMobil, on the other hand, is in the position of traditional plaintiff, as- serting the affirmative position that SABIC caused it harm by improperly overcharging the joint ven- tures, and that SABIC is liable for damages for its misconduct. ELL'A FNI0. Id. In reality, SABIC is a "nominal" plaintiff; there is no question that the ultimate issue to be decided by the jury is whether SABIC overcharged the joint ven- tures. There is also no question that ExxonMobil bears the burden of proof with respect to this ultimate issue. ExxonMobil further argues that "given the facts surrounding SABIC's filing, allowing it to have the benefits of being the plaintiff without the attendant burdens is grossly unfair." Eall Clearly, SABIC did win the race to the Courthouse, and, in doing so, selected the forum in which it desired to have the overcharge issue decided. It is also clear, based on SABICs actions, that it did not want the New Jersey District Court to decide the overcharge issue. —Ll Given what transpired prior to the filing of this suit, the Court can only conclude that SABIC engaged in preemptive forum shopping when it decided to file a declaratory judgment action in the Delaware Superior Court rather than litigate this issue as a defendant in the New Jersey District Court. That being the case, the Court notes that: FN I I. Def.'s Mem. Law at 10. FN12. SABIC filed suit here just ten (10) days before ExxonMobil filed suit in New Jersey District Court on the same overcharge issue. FN13. SABIC argued to the New Jersey O 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. EFTA01069756 Page 3 Not Reported in A.2d, 2003 WL 25849476 (Del.Super.) (Cite as: 2003 WL 25849476 (Del.Super.)) District Court that it should abstain from de- ciding the overcharge claims because SABIC filed this action before ExxonMobil filed the overcharge claims there. ... the use of the device of declaratory judgment to anticipate and soften the impact of an imminent suit elsewhere concerning long past dealings be- tween the parties for the purpose of gaining an af- firmative judgment in a favorable forum requires a closer look at the deference historically accorded a plaintiffs choice of forum.alli FN14. Products and Chemicals. Inc. v. The Lummus Co.. 252 A.2d 545, 547 (Del.Ch.1968) rev'd on other grounds, 252 Aid 543 (Del.1969). While the Court is historically reluctant to de- prive a plaintiff of its choice of forum, it is not reluc- tant to accord less deference to that choice when there is "jockeying for position" by "resort to de- claratory judgment for the purpose of defensively establishing priority as to forum." EMI Similarly, the Court is not reluctant to realign the order of proof where a party resorts to a preemptive strike via de- claratory judgment for the purpose of securing prior- ity as to forum, when realignment makes clear the true posture of the case.F1414 Under the circumstances presented, the Court is compelled to look beyond the pleadings and allocate the burden of proof to the party that must prove the ultimate issue at trial, ExxonMobil.Eall FNI5. Id. FN16. See BASF Corp. v. Symington, 50 F.3d 555. 557 (8th Cir.1995) ( realigning the parties to reflect actual controversy where plaintiff (BASF) filed declaratory judgment on statute of limitations, but defendant "claims injury by BASF, and is therefore the natural plaintiff'); St. Paul Mercury Ins. Co. v, Lexington. Ins. Co.. 888 F.Suop. 1372 1376 (S.D.Tex.1995) ( realigning parties "to better represent the real claims and interests in the case."). See also Schwendiman Part- ners. LLC v. Hurt. 71 F.Supp.2d 983. 988 n. 4 (D.Neb.1999) ("In determining the propri- ety of a declaratory judgment action in cir- cumstances like those presented in this case, the court will realign the parties to reflect the actual controversy underlying the action and determine who is the natural plaintiff") (citation and quotation omitted). FN17. See City of Indianapolis v. Chase Nat'! Bank of the City of New York 314 U.S, 63 69. 62 S.Ct. 15, 86 L.Ed. 47 (1941); Philips v. Liberty Mutual Ins. Co.. 235 A.2d 835 (De1.1967); /Push v. Bellow. 1987 WL 9369 (Dcl.ChJ; Lutz v. Boos. 171 A.2d 381 383 (Del.Ch.1961). In its opposition to realignment, SABIC argues that changing the "ordinary order of proofs would be [grossly] unfair to SABIC." EM The Court does not agree. The Court's obligation is to exercise "reason- able control" over the presentation of evidence "so as to ... make the presentation effective for the ascer- tainment of truth...." cu2 Under the circumstances presented, there will be no unfairness to SABIC by realigning the order of proof to place the burden of proving the ultimate issue on the party it belongs, thereby making it easier for the jury to understand the presentation of evidence. FN18. Pl.'s Br. Opp'n Def.'s Mot. Realign Order Proof Trial Presentation at 10. INI9 DEL. UNIF. R. EVID. 611(a). CONCLUSION *3 In the Court's view, proceeding with the order of proof in this manner will promote efficiency, con- serve the parties' and the Court's resources, insure the orderly and clear presentation of the evidence, and reduce juror confusion. For all these reasons, the Defendants' Motion to Realign the Order of Proof for Trial Presentation is GRANTED. Del.Super.,2003. Saudi Basic Industries Corp. v. Mobil Yanbu Petro- chemical Co. Not Reported in A.2d, 2003 WL 25849476 (Del.Super.) END OF DOCUMENT O 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. EFTA01069757 Page 4 Not Reported in A.2d, 2003 WL 25849476 (Del.Super.) (Cite as: 2003 WL 25849476 (Del.Super.)) C 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. EFTA01069758