Document 96
posted on
Jun 10, 2007 03:44AM
I downloaded docs 94, 95 & 96 -- I didn't want to be obliged to DPRoberts/Cass for anything to do with my investment. Docs 94 and 95 are interesting reading but doc 96 is CRUSHING to digEcor in my opinion. It is 67 pages long of some brilliant legal arguments by EDIG and their Utah lawyers. I can't upload it to my public website now but will by 0800 MST, along with 93, 94 and 95. I've pasted paragraphs II.18 and II.19 below for review. Should give investors plenty of good reading today.
18. Under the Noncompete Agreement, e.Digital agreed not to use Boyer’s idea “except for evaluating its interest in entering [into] a business relationship.” Id. ¶ 32 & ex. A. Accordingly, it agreed that it would “safeguard [his] information” as if it were its own, id. at ex. A, ¶ 1, and that it would not disclose his information without written permission, id. at ex. A, ¶ 2-3. Further, e.Digital agreed that it would “not directly or indirectly acquire any interest in, or design, create, manufacture, sell or otherwise deal with any item [or] product, containing, based upon or derived from the information” unless Boyer expressly agreed in writing. <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:sm... />Id. Boyer never agreed, either in writing or otherwise, to allow e.Digital to “acquire any interest in, design, create, manufacture, sell or otherwise deal with any item [or] product based upon” his idea. Id.<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:of... />
Disputed. This paragraph elides important exceptions included in the NDA. e.Digital’s nondisclosure obligation explicitly excluded any information
a. which RECIPIENT can demonstrate by written records was previously known;
b. which are now, or become in the future, public knowledge other than through acts or omissions of RECIPIENT
c. which are lawfully obtained by RECIPIENT from sources independent of RECIPIENT;
2002 NDA, ¶ 3. In other words, e.Digital was not bound to keep secret any ideas it already possessed, or which were public knowledge. At that time, e.Digital was already working on its own media player device. Ferguson Decl. ¶¶ 3-9; Anandpura Decl. ¶ 2; Falk Decl. ¶¶ 5-7, 15; Bostenero Decl. ¶¶ 3-8; Bastian Decl. ¶¶ 4-7. Further the idea of a hard-drive based media player for use in the in-flight entertainment industry was already public knowledge. One company, Archos, was publicly marketing hard drive based portable video players “intended for” use on an airplane before Boyer contacted e.Digital. See Falk Decl. ¶ 13 & Exhibits 1-3 thereto. Archos had introduced a hard-drive based portable video player known as the Archos Jukebox Multimedia in 2001. Id. Indeed, a January 2002 article about the Archos player indicated that it “would do well on a plane or a long commute, which is basically what it’s intended for.” Id. Ex. 2.
19. An important provision in the Noncompete Agreement was paragraph 6 (the “Noncompete Agreement”), which stated that e.Digital would not “compete with APS, Inc., directly or indirectly during the term of this Agreement and for a period of seven (7) years after the termination of this agreement anywhere in the world. . .by manufacturing and/or selling like or similar components.” Id. ¶ 33 & ex. A, ¶ 6.
Disputed. Again, Plaintiff omits the most pertinent language from the NDA. The agreement explicitly limits “competition” to mean “manufacturing or selling like or similar components: (any and all components that APS, Inc. and manufactured, designed etc.” 2002 NDA, ¶ 6. This sentence limits the non-compete provision to mean that e.Digital cannot manufacture or sell components similar to components that are manufactured or designed by APS. Id. APS has never at any time manufactured or designed any digEplayer-related components. Clark Decl. ¶ 6; Ferguson Decl. ¶¶ 31-32, 36; Anandpura Decl. ¶ 7. Indeed, it has never had expertise to do so. Clark Decl. ¶ 6; Ferguson Decl. ¶ 32; Anandpura Decl. ¶ 7.