All claims and counterclaims withdrawn, dismissed with prejudice. Jury dismissed. Here is my account of what happened in court today. These notes are not much edited.
I arrived at 9:10 AM. There was the appearance of a hearing with something missing, two plaintiff attorneys (probably), one woman sitting on the defendant side, nobody saying anything. Altonaga sitting on the bench, waiting.
Eventually a man walks in and sits down next to the woman. Altonaga has a brief exchange with him and sets a hearing for Friday and they leave.
In the Gallery: Lukacs, Bernstein, Nunez. De la Barra and Johnson walked in at 9:15.
Then Altonaga called Rossi v Darden and told the attorneys they could set up. Altonaga left the courtroom, then it was “all rise” at 9:20 and she came back. Darden walked in with Erika Handelson., Lomax and Pace.
Lukacs asked the Judge for fifteen minutes to confer with Pace. She said, “brief, please,” as I recall. They went out together.
Chaiken and Lomax walked out. Rossi came in. Annesser came in at 9:25. Chaiken came back in, started setting up four display boards, for the timeline again. Bernstein walked in with a box of sticky tags to use as markers on the timeline, as before.
If that timeline is used during testimony, I’d think of objecting to it. It is a form of argument. But I don’t know precedent.
Rise for the jury at 9:30.
Lukacs and Pace came in, Lukacs started to say something, and Altonaga shushed him, the jury was coming in. Lukacs and Pace walk back to the Judge and go into her chambers, and she joins them. She comes out and sends the jury out for 15 minutes.
Lukacs was whispering to Rossi and other counsel. The entire Rossi team walked out. (There are two attorney conference rooms off the courtroom entry way.) Bell and Pace walk out. Chaiken stood in extended friendly conversation with Lomax. Bernstein walked up and shook Lomax’s hand. They are smiling. Darden remained sitting, not interacting with anyone. Serious face. The 3rd party counsel remain seated. Chaiken and Lomax continue to whisper and smile. Chaiken walks out, Bell walks in for a moment. Then Nunez and Bernstein whisper. Nunez appears bemused.
Whatever is going on, it doesn’t look like Bad News. The timeline was better lined up this time. Bell walks in, whispers to Lomax, smiling. Lukacs comes in and calls on Nunex and de la Barra to come out.
This was high drama, while being very quiet. It’s obvious what is happening. They are discussing settlement, at least of some issues. They have made enough progress to pull in the 3rd party attorneys.
Erica and Lomax chat, Nunez walks in smiling. All return. Lukacs asks me to leave (apparently by name, because Pace asked “which Lomax, both are named Lomax.”) But I’d immediately risen to go, because I knew what was happening. This was to be a brief closed hearing. Pace said to me, “Ill talk with you later.” I sat on the comfortable foam cushions in the central area of the 12th floor, looking at the view, completely pleased. Sure, we want the truth, but at what cost? We already, speaking for the public, know enough to have a good sense of what happened, of the reality of this history, if anyone wants to know, the information is there. If people don’t want to know, even a jury decision won’t convince them. “Punishment” has low value.
I noticed that a man who had been there, off and on, was sitting outside also. I walked over to him and ask him his connection with the case. This was Darden’s son, also named Tom. We chatted about the case and the appearance that it was settling. Darden came out and I mentioned I’d like to talk with him or part of the IH team before I left Miami. He had me give my phone number to his son. Then the jury walked out, obviously dismissed.
Lukacs came out and I asked him if he could make any statement about what is going on. “I’m not at liberty to say” Rossi walked out and I shook his hand and he warmly returned it. Pace chatted with me for a minute. He wanted to be very careful, but he said that the obvious was happening. He said that he would be releasing a statement later. My sense was that there were no conditions to the settlement, the complaint was dropped and likewise the countercomplaints. Over. Finished.
Darden was philosophical. He was, here, accepting a loss of about $20 million, but Darden, with Cherokee, certainly risks that level of investment commonly, and risk implies that sometimes one will lose. In fact, though, LENR won, because the bold move to invest about $20 million in Rossi technology created a movement that raised, for that purpose, through IHHI, $50 million. Their goal was to find out about Rossi’s claims. Reasonably enough, they found out.
Until I see it officially announced, I cannot be 100% sure that Rossi v. Darden settled on day 4 of the trial, returning to status quo ante. I don’t know if the dismissal was with or without prejudice, by my sense is that it would be with prejudice. However, I’d assign a probability of full dismissal at 99.9%. Good enough for folk music.
Okay, it’s now in the docket as 332. The “case settled.” We have no official details other than that. I expect to see a joint stipulation in short order that will give a little more detail. Probably ”
It means a lot and it means less than many are saying. My report, above, is being repeated with what is standard: it is interpreted favorably to existing opinions. There is good legal analysis on LENR Forum by woodworker and Mike Dunford (both lawyers, IANAL). I wrote that Darden was pensive. I will emphasize that this was the appearance: both sides were ready to start with the evidentiary phase of the trial. Chaiken was setting up his timeline (which might have been shot down as argumentative, but the trial never got to that point). It was all business. Darden looked pensive.. He might look that way if he had mild indigestion, and this could be totally meaningless. Frankly, I wasn’t looking forward to what would come next: a series of useless evidences that even if completely true would be irrelevant except within a highly misleading context.
I.e., say, Rossi had proof!, proof, I tell you, that someone in Cherokee was happy about the Agreement with Rossi, in a private memo. Darden is the CEO of Cherokee, and IH’s business was consistent with the long-term goals of Cherokee, but Cherokee never starts risky ventures directly, it always does it through liability-limited companies, otherwise the entire $2.2 billion entity could be pulled down by a single error. Instead, CIP, with true Cherokee LLCs, invests maybe $25 million, which is what they have at risk. These LLCs are independent, attract their own investors, may take out loans, all normal business. Some — a few — ultimately fail, but Cherokee never is itself at risk beyond their investment. That is absolutely necessary and normal for the kind of business they do.
So Chaiken would be taking a document out of context. He’d combine it with another alleged fact he had. Half of the original $1.5 million was paid from Cherokee. If Cherokee were the full owner, as Rossi claims to have believed, they wouldn’t have paid half, they would have paid the full amount. Rather, this was almost certainly a loan to Darden, personally guaranteed, and I’d bet he paid interest at the statutory rate. These guys are not stupid! None of this would be legally adequate to overcome the standard Entire Agreement clause of the Agreement and the Statute of Frauds, all of which is intended to prevent legal disputes like this.
I am trained to create excitement and connection. I noticed my reaction to what was coming and deliberately dropped it. In that process, for a short time, my face may have shown something like an upset stomach.
Darden’s countenance did not telegraph that he thought they were going to lose, which is a claim being made on ECW.
The appearance was that Lukacs initiated the out-of-the-courtroom discussion with Pace. That could be misleading. I have no strong evidence that Pace did not privately say something to Lukacs, with then Lukacs merely being the one to ask the Judge for delay in starting the presentation of evidence to the jury. That was initially delaying the jury entry. Altonaga wasn’t eager for delay, she asked Lukacs to be quick. It is very clear, though, that this was not pre-arranged. There was no sudden shift in mood, not immediately. Altonaga waited about 15 minutes, then told us to rise for the jury. Lukacs and Pace came back in and Lukacs addressed the court. His comment was not intelligible to me. Altonaga told him to wait, the jury was coming in. Then, when the jury was seated, Lukacs and Pace approached the bench, then went back into the judge’s chambers, and she went there as well. She came back and sent the jury into a 15 minute recess. Then came much scurrying in and out of lawyers and parties. The courtroom was very quiet, if I was close to attorneys whispering, mostly I still couldn’t hear anything. But the mood brightened quite visibly and attorneys from opposing sides were smiling at each other, sharing what, I noted at the time, did not “look like Bad News.” To anyone.
(Some have claimed that this was based on lawyers gleefully anticipating being paid. See below about anti-lawyer bias. If what they wanted was more money, this wouldn’t be good news. If what they want is client benefit — which is what their ethical standards require — this was good news for everyone, assuming that there were no poison pills included. Good News compared to fighting to the bitter end. Far less stressful.)
When the 3p attorneys were called out, it had gone beyond obvious without anything being said. A settlement was being negotiated. From the context, I knew it had to be simple and decisive. Altonaga would not tolerate less, I’m sure. It would leave the parties free to negotiate anything they wanted that they could agree upon without legal coercion. It could not seriously damage any party, because they would otherwise prefer to finish what had been started — at great expense!. But it would almost certainly not involve any payment, meaning that all parties would bear their own expenses. As soon as significant compensation or other changes would enter the picture, it would get complicated. They could have asked the Judge to delay the trial a day so they could work out a more complex agreement. My sense of Alttonaga is that she would not have accepted that. So it had to be simple, something that both Rossi and IH could accept, and the 3p attorneys would accept (though I’m not sure they would have had the power to stop it.)
I doubt if there was any specific agreement regarding paying legal costs (other than something very simple like “parties to bear their own costs.”) I had a few words with IH counsel before this was complete. Somehow in that, I don’t remember who said it, I got that what was being proposed was total, mutual, dropping of legal claims, very simple, with everything else being subject to direct agreement of the parties outside of court (which would be, essentially, return to status quo ante). Lukacs was able to convince Rossi probably on the strength of his personal reputation and an assurance that there would be good-faith negotiations. (This is radically different from what Annesser had done in December 2015, when he threatened IH with suit for “anticipatory breach of contract.” Pugnacious, what some people think attorneys should be.)
As soon as Rossi wrapped his head around the possibility, I’m sure he’d feel an immediate sense of impending relief.
Lukacs and Pace returned and prepared to address the court. At that point, Lukacs asked that I be sent out, apparently by name (because of a question by Pace about “which Lomax”)?
Getting up to go (I did not wait until the Judge ordered me out, I knew she would grant the request to close the court), I was close to Pace and he said to me, “I’ll talk with you later.”
Outside, I eventually asked who the other man sitting out was, and he, (Darden’s son) told me. We talked about the case and the apparent settlement. There were mixed feelings. He — and I — were looking forward to resolution, and this was a bit like charging out into a battlefield, ready to fight, some believing the enemy was evil and had fangs, and someone blows the whistle and says, “Game over, shake hands and go home!” What? Shake hands with Satan?
Yes. Shake hands with that other human being, now, either work together to build a better future for all of us, or stand back and allow others to do that. Don’t keep fighting, it is the fighting and hatred that is Satan’s work. This is all long-term ontology for me, and training.
At some point Darden came out and was talking with us. I said some things about the settlement and about IH future. He said, “Smart man.” Darden does not say a lot, is not chatty, but conveys confidence. If you don’t trust him, don’t invest with him! He’s not going to argue. If needed, he has others to do that for him, called lawyers. Try to go and tell Bill Gates he’s stupid for supporting LENR research. See if you can even get those words to his ears. He has experts to filter information flow. He is not Donald Trump, even though he’s richer. Heh! Sorry, Trump fans, but I think you could agree that Trump is not Gates. If not, my condolences, it takes all kinds.
When the jury walked out we knew that it was over. There was no way that Altonaga was going to allow any delay in the trial, she was already fried and wanted to clear her docket ASAP. If they wanted to dicker over terms, fine. Let them dicker, out of court, but not delay the trial.
Then Pace came out and came up to me. Man of his word. We talked a little. Lukacs came out and I asked if he could comment. That is when he said he was not at liberty to comment Now, here is where I can see a strong difference between Pace and Lukacs. Lukacs was blunt, pure business. I knew that what he was saying was probably legally necessary. I did not resent it, and, in fact, I smiled and thanked him. He was not smiling. He was like a surgeon who had just extracted a life-threatening tumor in an operation painful to the patient, who is totally focused on being a doctor and dealing with the physical. I see Lukacs as highly professional, but not necessarily a people person. Whatever people skill he has — and they must be considerable in some ways — he wasn’t using them with me. Just saying. He did nothing wrong.
Pace essentially told me the same thing, but in a way that would normally generate positive feelings. He showed by his affect that he was friendly and would like to tell me what was happening, but he said that he needed to wait to be sure, “as a caution.” At some point Lomax told me that he was intending to provide me the daily court transcripts. I asked him to send them to me anyway, please. And he said he would. This would be a neutral contribution that he and Jones Day could provide my work. I was planning to also ask Rossi counsel for that.
When the jury walked out, it was completely obvious that the case was over, even though Altonaga did not have a marshal tell those outside that they could come back in. I went back in, and the courtroom was almost empty. Rossi’s counsel had all walked out carrying boxes of stuff.
Now, on LENR Forum, to some degree, in comments here, to some degree, and more on e-catworld.com, there are those creating fantasies of what the “settlement” was, and then, generally, declaring a huge victory for Rossi, assuming that the License cancellation would stand (neglecting that this unilateral action had been ignored by IH and correcting this had not been a dismissed claim of theirs. Why waste legal time and money over a nullity? It’s moot unless IH attempts to rely on the License, which is very unlikely, unless Rossi actually does hit the market, then it could be worth billions, so … worth even huge legal expenses, and with a slam-dunk case (which we have seen, even slam-dunks sometimes don’t go through the basket, but people at this level are constantly playing the odds as they read them. Relatively disempowered people look for certainties and even prefer to pretend them, and the dysfunction behind this is common and training to overcome that is rare. There is very little genuine certainty in life, but some of us are afraid of that and attempt to deny it.)
Mary Yugo actually made a decent comment on why this is. “She,” however, is probably operating with the instinctive responses being “wrong.” Rather, they are, as pointed out, functional in emergencies but then can disempower us if maintained beyond emergency conditions. In my training, the emergency response is called an “amygdala hijack,” and it is quite visible and recognizable, and also easily handled, but not by declaring it “wrong,” which then sets up an internal power struggle, and the amygdala is designed to always win this struggle, it literally hijacks the entire structure of the mind. Rather, the amygdala is a primitive machine, but it understands language and is programmable. Actually doing this, programming the amygdala, can look like a miracle. When the amygdala is active, the entire and vast associative engine of the cerebral cortex is turned to the service of the emergency response. It will find “proof” that it is “right,” and may go to extreme lengths to preserve identity, faced with what it sees as a challenge. The simplest solutions can be practically invisible, because of this activity. In a word, reactivity can make us stupid.
To accept what I think was the actual “settlement,” something very simple was necessary, that Rossi had in his power, in theory, even before he filed the suit in April, 2016. Rossi had to give up his attachment to “being right.” He had to let go. There is a predictable result from this, I’ve seen it hundreds of times: an enormous relief and a transformative increase in joy and power. You can see this in JONP. Someone has also reported that Rossi is “Happy, happy.” (An unattributed rumor passed on by someone who is sometimes accurate, on LF.) From that, conclusions are being drawn that Rossi must have gotten what he wanted.
While we cannot at this time know if there were any stated conditions, they were not, I’m sure, stated in court and would not be legally binding. The most I expect was actually agreed in court was the withdrawal of the claims and counterclaims, the dismissal of the case, with prejudice. If you were worried for a year that you might not only not get what you wanted, but might end up essentially screwed, bankrupt, and then it all goes away, because you are willing to let go of what was driving it, being very happy would be normal. Even if you aren’t getting what you wanted. Manic attachment to declared purpose is not a formula for happiness, it’s the opposite. Even if one “wins,” sometimes. Happiness, genuine happiness, comes from a realm that is not the realm of right and wrong, good and bad, but that is simply present to life. Rossi can now enjoy playing tennis with his wife. And his wig looked nice. Life is good. His work is fun.
Planet Rossi has expressed some amazement that I didn’t attack or lash out at Rossi. That is because they largely bought a world-view that I was a paid FUD-er. Some of them still repeat that charge as if it was proven and admitted. But it has been continually denied, ever since the issue was first raised, and all this means is that people will often believe what makes them feel most secure. I do not allow my security to depend on fact and conditions. It depends on trust in reality, only, independent of conditions. That, again, is training, though it is also connected with what I’ve been studying since my twenties. I recommend, highly, declaring and standing for a full and complete trust in reality itself. It’s not necessarily easy, even though it is obviously necessary for true security. I’m going to die. That’s not bad news! I might be wrong about this or that, various ideas about reality, but what I trust is not my ideas, but reality itself.
I am also human and become afraid, but when I remember the commitment, the fear vanishes.
My impressions of the settlement are informed, I was a few feet away when it happened, and talked with some of the players. That impression includes that there might be additional voluntary agreements. There are some simple ones that might either have been negotiated, involving claims in the lawsuit that a good mediator may have been able to turn quickly into agreement. Most likely, though, any complications would have prevented full and complete agreement in the short time available.
The fact of withdrawal of claims cannot be used to show anything that was not already obvious from the known evidence and I see no way to assume what was in any binding agreements, other than an assumption that if these were seen as harmful to any side, the settlement would have failed.
I intend to continue organization of case evidence, including presenting opinion, but “attacking” Rossi has never been my agenda, rather, it has been to share evidence and my sense of implications. There are those in the various communities involved who are still fighting the war. They will continue to make themselves unhappy and will not contribute to the future of LENR. They will not help Rossi nor IH. IH never wanted this fight. Dewey Weaver’s opinion — and I like Dewey — was never more than his informed opinion plus his own personal reactions.
When I wrote the first draft of this page, I mentioned expanding it “when I got home” That meant when I was back at the apartment where I am staying. I intend to continue organizing the case material when I am back in Northampton, probably next week.
I have the Day 4 transcript.
It generally confirms my impressions. There are two minor differences:
When Lukacs asked to speak with defense counsel, it was not just Pace, it was also Bell. I’m not surprised, but apparently I didn’t notice it at the time. Why Bell? Probably for the same reason as was behind Lukacs making the request. A less involved attorney, less committed to the fray. I had some brief, pleasant conversation with Bell. Very nice guy. Same with Pace, by the way.
Then there is this interchange, when Altonaga had sent the jury out for a recess because of the request by Lukacs and Pace.
(A recess was taken from 9:30 a.m. to 9:55 a.m.)
MR. LUKACS: Sir, would you mind excusing yourself?
GALLERY SPECTATOR: Yes.
MR. LUKACS: I was just asking him to leave for a
I think the recorder missed something. This wasn’t me, this was probably Tom Darden, the son. Just before this, Lukacs asked for Mr. Lomax to leave, by name. Pace said “There are two Lomaxes.” I did not reply, I just left, because, obviously, Lukacs was referring to me.