Software Rights Archive, LLC v. Google Inc. et al

Filing 118

SUR-REPLY to Reply to Response to Motion re 66 MOTION to Dismiss for Lack of Standing filed by Software Rights Archive, LLC. (Attachments: # 1 Exhibit Table of Exhibits, # 2 Exhibit Exhibit 1, # 3 Exhibit Exhibit 2, # 4 Exhibit Exhibit 3, # 5 Exhibit Exhibit 4, # 6 Exhibit Exhibit 5, # 7 Exhibit Exhibit 6, # 8 Exhibit Exhibit 7, # 9 Exhibit Exhibit 8, # 10 Exhibit Exhibit 8, # 11 Exhibit Exhibit 10, # 12 Exhibit Exhibit 11, # 13 Exhibit Exhibit 12, # 14 Errata Exhibit 13, # 15 Exhibit Exhibit 14, # 16 Exhibit Exhibit 15, # 17 Exhibit Exhibit 16, # 18 Exhibit Exhibit 17, # 19 Exhibit Exhibit 18, # 20 Exhibit Exhibit 19, # 21 Exhibit Exhibit 20, # 22 Exhibit Exhibit 21, # 23 Exhibit Exhibit 22, # 24 Exhibit Exhibit 23, # 25 Exhibit Exhibit 24, # 26 Exhibit Exhibit 25, # 27 Exhibit Exhibit 26, # 28 Errata Exhibit 27)(Duvvuri, Narasa)

IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF TEXAS MARSHALL DIVISION

SOFTWAR RIGHTS ARCHIVE, LLC §

~§

Plaintiff, §
§

§

§

Civil Action No. 2:07-cv-511 (CE)

GOOGLE INC., YAHOO! INC., §
lAC SEARCH & MEDIA, INC., AOL LLC, §

and LYCOS, INC. §
Defendants. §
§

JURY TRIAL DEMANDED

THIRD DECLARTION OF JEFFREY FRAKLIN AlT
I, Jeffrey Franin Ait, hereby make the following declaration under penalty of perjury.

All facts set forth herein are tre and correct, and I make this declaration based upon my personal
knowledge and upon review of corporate records.
1. I was the Chief Executive Officer of the debtor Site Technologies, Inc. ("Site

Tech," and formerly known as "DeltaPoint, Inc.") and the debtor's subsidiar
Site/technologies/inc ("Site/Tech") at the time of Site Tech's banptcy. I was also the offcial

"Responsible Person" under the. banptcy plan and was charged with implementing the plan
and creating the debtor's schedules.

2. On September 16, 1998, Site Tech sold and assigned, among other things, u.S.
Patent No. 5,544,352, and related applications and futue patents (which include u.S. Patent Nos.

5,832,494 and 6,233,571) (collectively, ~~the Patents") to Daniel Egger. Daniel Egger paid
$100,000 for the Patents. Prior to the banptcy, Site Tech and Site/Tech considered the sale

and transfer of the patents to Danel Egger as valid, consumated, and complete, and reflected

this in numerous SEC statements and other corporate records. Site Tech and Site/Tech

IEXHIBIT 6 L

maintained this view throughout the bankptcy and disclosed the transfers in several banptcy

filings. First, we explicitly identified the sale and transfer of the Patents to Daniel Egger in both

Disclosure Statements, which described the effect of the debtor's plan for puroses of approval

from the creditors. See Debtor's First Amended Disclosure Statement at ~ 5.5, attached as
Exhibit A ("In September 1998, the Company also sold its V-Search technology and related

patents."). Second, we listed the September 1998 transfer of the Patents to Danel Egger as a
transfer of the debtor's property within a year in the debtor's Statement of

Financial Affairs. See

Statement of Financial Affairs at ~ 10 (Other Transfers), attached as Exhibit B. Finally, Site

Tech and Site/Tech deliberately excluded the Patents in the debtor's property schedules
describing intellectu property assets held by the debtor. See Schedule B at ~ 21 (listing patents,

copyrghts, and other intellectual property), attached as Exhbit C. We did this because we
believed that the Patents had been the subject of a valid transfer to Danel Egger in September
1998 and thus were not owned by Site Tech at the time it

filed for banptcy. We also did not

amend the debtor's schedules to list the Patents afer Site Tech and Site/Tech merged in

December 2000, because Site Tech and Site/Tech did not believe that the Patents were held by
the subsidiar at the time of the merger or became Site Tech's propert as a result of

the merger.

Rather, both Site Tech and Site/Tech had conceded that the Patents were transferred to Daniel
Egger in September 1998. The purose of listing this transfer, among other thgs, was to

indicate to all interested paries in the banptcy that the Patents were trsferred to Danel

Egger prior to the banptcy and thereby give such pares an opportunity to challenge the
validity of the assignment and recover the Patents for the benefit of the Debtor's estate. Such
disclosures confired that, absent the successful prosecution of an action to recover the Patents,
the Patents would not be available for distrbution to creditors and other staeholders.

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3. On April 25, 2000, Site Tech filed its First Amended Plan of Reorganization,
attached as Exhibit D. Site Tech also fied its First Amended Disclosure Statement for the plan
on that same date. The banptcy cour entered an order approving the disclosure statement on

April 26, 2000. The order approving the disclosure statement allowed Site Tech to mail the
amended plan and disclosure statement to its creditors and interest holders in order to solicit their
support for the plan. Following a hearg, the banptcy court entered its Order Confirming

FirstAmended Plan of Reorganzation on June 15,2000, attached as Exhibit E. Paragraphs B
and C of the confrmation order make explicit reference to the amended disclosure statement and
the cour's approval thereof.

4. My understanding is that the defendants in this matter assert that the Patents and
other former assets of Site/Tech were never assets of Site Tech because the documentation was

insufficient to transfer these assets to Site Tech. Both Site Tech and Site/Tech long considered

the former assets of Site/Tech to have been transferred to Site Tech in connection with Site

Tech's acquisition of Site/Tech in July 1997. For that reason, we listed the former assets of
Site/Tech as the assets of Site Tech in the debtor's schedules. For example, the Site Sweeper
product and technology that was a former asset of Site/Tech was listed in paragraph 21 of

Schedule B as belonging to Site Tech. It was sold by Site Tech in accordance with the plan and
represented a substatial par of the consideration that resulted in a one hundred percent recovery
for creditors and a substatial retu of fuds for the former shareholders of Site Tech.

5. Had Site Tech and Site/Tech not conceded the validity of the transfers of assets

from Site/Tech to Site Tech or the validity of the transfer to Danel Egger, it would have
threatened the overall success of the banuptcy in paying off the creditors, approving and

completing the plan, and obtainig a return for Site Tech's shareholders. We would have been

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involved in costly litigation with Danel Egger, which I believe would not have been successful

given that we had represented to Egger that we were properly assignng him the patents and
given that he paid $100,000 for them. This would have depleted the resources of

the estate for a

losing effort. Even if we were successful in recovering the Patents, Daniel Egger would have
had a substantial claim in the bankptcy for the Patents. Ths would have certainly threatened
the recovery we obtaied for the shareholders, who would have been subordinate to Daniel

Egger, and ths also would have impacted whether the creditors would have been fully paid. .

Similarly, the failure to recognize the prior transfer of assets from Site/Tech to Site Tech could
have potentially impacted the plan's sale of assets in the Star Base acquisition, which provided

substantial benefits to all the stakeholders in the banptcy.
I declare under penalty of perjury under the laws of the United States of America that the
foregoing is true and correct.

~1Ūt

Executedon r. De~el\br ,2008 Myrle Beach, South Carolina

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