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Declaration of Alfredo Skinner-Klée (in the role of a Guatemalan legal expert) in support of Microsoft Corporation's Motion to Dismiss the Amended Complaint filed by Seguros Universales, S.A., et al.
Declaration of Alfredo Skinner-Klée (in the role of a Guatemalan legal expert) in support of Microsoft Corporation's Motion to Dismiss the Amended Complaint filed by Seguros Universales, S.A., et al.
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Declaration of Alfredo Skinner-Klée (in the role of a Guatemalan legal expert) in support of Microsoft Corporation's Motion to Dismiss the Amended Complaint filed by Seguros Universales, S.A., et al.
Droits d'auteur :
Attribution Non-Commercial (BY-NC)
Formats disponibles
Téléchargez comme PDF, TXT ou lisez en ligne sur Scribd
Case 1:13-cv-22131-JLK Document 18-2 Entered on FLSD Docket 09/20/2013 Page 1 of 10
UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA MIAMI DIVISION CASE NO. 1:13-cv-22131-JLK SEGUROS UNIVERSALES, S.A., a Guatemalan anonymous society, FIANZAS UNIVERSALES, S.A. n/k/a ASEGURADORA FIDEUS, S.A., a Guatemalan anonymous society, and ORDENADORES, S.A., a Guatemalan anonymous society, Plaintiffs, v. MICROSOFT CORPORATION, a Washington corporation, Defendant. DECLARATION OF ALFREDO SKINNER-KLEE I, Alfredo Skinner-Kiee, being duly sworn, hereby state as follows: 1. My name is Alfredo Skinner-Kiee. I am over the age of eighteen (18) years. I am a citizen and resident of the Republic of Guatemala ("Guatemala"). 2. I am licensed to practice law in Guatemala and am admitted to, and in good standing before, the Bar of Guatemala. I am a native Spanish speaker and have received some training in the English language and can speak it fluently. 3. Currently, I am a senior partner at the law firm of Arenales & Skinner-Kiee in Guatemala, Guatemala. My law firm is recognized as one of the leading law firms in international business transactions and litigation in Central America. The firm and several of its members, including me, consistently have been rated as among the best in Guatemala by Case 1:13-cv-22131-JLK Document 18-2 Entered on FLSD Docket 09/20/2013 Page 2 of 10 several independent publications} including Chambers and Partners (Global and latin America); Latin Lawyer 250; International Financial Law Review 1000; and Legal500. 4. Although I have a broad and diverse law practice} I specialize primarily in the areas of complex commercial and civil and transaction and litigation; constitutional law; administrative law; international commercial law; product liability; corporate law; and banking/financial law. I represent (or have represented) numerous high-profile clients in some of the most significant civil and commercial matters in Guatemala. 5. I currently serve as the President of the Board of Directors of the "Centro de Arbitraje y Conciliaci6n de Ia Camara de Comercio de Guatemalan (the "Center for Arbitration and Mediation of the Chamber of Commerce of Guatemalan) ("CENAC 11 ) 1 the first and largest private institution of its kind in Guatemala. CENAC administers} promotes} and facilitates the arbitration and mediation of legal disputes among private litigants in the commercial and financial settings. In addition} from 1990 to 1995 1 I served as a member of the "Parlamento Centroamericand 1 (the "Central American Parliament 11 ) ("PARLACEN 11 ) 1 which is the parliamentary body of the "Central American Integration Systemn r'SICA 11 ) 1 an institution with the fundamental aim of promoting the political} legal} economic} and ideological integration of the countries of Central America. The PARLACEN is charged with 1 among other duties} proposing and analyzing legislation} international and regional treaties} and other agreements on behalf of SICA. I also served as a director from 2004 to 2008 of the "Banco Centroamericano de lntegracion Economican (the "Central American Bank of Economic Integration}}) ("CABEI 11 ) 1 a multilateral bank that aims to promote the economic integration and development of the countries of Central America. 2 Case 1:13-cv-22131-JLK Document 18-2 Entered on FLSD Docket 09/20/2013 Page 3 of 10 6. Throughout my thirty-plus years legal career, I have served on the board of directors of several leading corporations in Guatemala, including Tabacalera Centroamericana S.A. (Philip Morris International subsidiary); Mexichem Guatemala, S.A.; various subsidiaries of the Neumann Kaffee Gruppe in Guatemala; Corrugadora de Guatemala, S.A.; and various subsidiaries of Fresh Del Monte Inc. in Guatemala. 7. I have been retained as an expert witness or expert consultant in proceedings in both Guatemala and the United States. Previously, I served as an expert on behalf of one of the defendants in a matter before this Court that was styled, Vil/eda Aldana v. Fresh Del Monte Produce, Inc. d/b/a Del Monte Fresh Produce Company and Compafiia de Desarrollo Bananero de Guatemala, S.A., No. 01-3399-civ-MORENO (S.D. Fla. 2003). 8. I have been engaged by the Defendant, Microsoft Corporation ("Microsoft" or "Defendant") in the matter styled, Seguros Universales, S.A., eta/. v. Microsoft Corporation, No. 1:13-cv-22131-JLK (S.D. Fla.). Upon information and belief, Microsoft has filed (or intends to file) a motion to dismiss (the "Motion") the First Amended Complaint for Damages and Injunctive Relief (the "Complaint"). I have been requested by Microsoft's legal counsel to address certain matters of Guatemalan law which are implicated by the allegations in the Complaint. I submit this declaration based upon my review and analysis of the Complaint (including all exhibits); the "Settlement Agreement" entered into by the parties and dated April 27, 2012; 1 relevant sources of Guatemalan law; and my own personal knowledge of the laws, legal processes, legal procedures, and judiciary of Guatemala. 1 A copy of the Settlement Agreement, along with a certified English translation, was provided to me by Microsoft's legal counsel as part of this engagement. 3 Case 1:13-cv-22131-JLK Document 18-2 Entered on FLSD Docket 09/20/2013 Page 4 of 10 Copyright Protection and Enforcement in the Guatemalan Legal Regime 9. The 11 Ley de Derecho de Autor y Derechos Conexos de Guatemala, Decreto No 33- 1998 (as amended by Decreto No 56-2000 and by Decreto 11-2006} del Congreso de Ia Republica" (hereinafter, referred to as, the (/Guatemalan Copyright Law") defines a computer software program as (/a work made up of all instructions expressed through words, codes, plans or in any other way that, when incorporated by machine into a legible support, is capable of making a computer execute a certain task or obtain a certain result." (Guatemalan Copyright Law, Article 4 (defining the term 11 Programa de ordenador'')). The Guatemalan Copyright Law states that a computer software program shall be "protected in the same way as literary works," and includes both the operating systems and any applications that are part of the software. (Guatemalan Copyright Law, Article 30). 10. The 11 Reglamento de Ia Ley de Derecho de Autor y Derechos Conexos, Acuerdo Gubernativo No 233-2003" (hereinafter, referred to as, the (/Implementing Regulation of the Guatemalan Copyright Law") expressly recognizes the rights of copyright owners to register their works, including copyrighted computer software programs, with the Intellectual Property Registry of Guatemala. (See Implementing Regulation of the Guatemalan Copyright Law, Articles 1 through 17). In addition, the Implementing Regulation of the Guatemalan Copyright Law provides a means for copyright owners to protect and give notice of their rights to their works by "us[ing] the expression 'Rights Reserved/ or the abbreviation [in Spanish] 'D.R.' followed by the year in which the copyright protection began, the letter 11 C" enclosed in a circle, and the full name of the copyright owner. (Implementing Regulation of the Guatemalan Copyright Law, Article 24). 4 Case 1:13-cv-22131-JLK Document 18-2 Entered on FLSD Docket 09/20/2013 Page 5 of 10 11. The Guatemalan Copyright Law provides that "[o]nly copyright owners and those expressly authorized by them may use the work in any way .... " Thus, copyright owners may seek to enforce their rights in the computer software programs against anyone who infringes on those rights. Acts of infringement may include, inter alia, any of the following: (1) the unauthorized and direct or personal use of a copyrighted computer software program; (2) the unauthorized and partial or complete assignment of the rights to a copyrighted computer software program; (3) improperly authorizing or prohibiting a third party's use or exploitation of a copyrighted computer software program; (4) the unauthorized and partial or complete reproduction or transfer of the copyrighted computer software program to a different format or medium, whether temporarily or permanently, through any process whatsoever, whether currently known or to be developed in the future; (5) the unauthorized communication to the public of the copyrighted computer software program, either directly or indirectly, through any process whatsoever, whether currently known or to be developed in the future; (6) the unauthorized distribution or dissemination to the public of the original or copies of the copyrighted computer software program either by sale, lease, loan, or in any other way. (See Guatemalan Copyright Law, Article 21). 12. Guatemalan law provides for both criminal and civil copyright infringement actions. The "C6digo Penal de Guatemala" (the "Guatemalan Criminal Code") provides, in pertinent part, that anyone who alters, erases, or, in any way, disables the programming or rights-management instructions or applications used by a computer software program, without the authorization of the copyright owner, shall be punished with imprisonment of six months to four years and fined between two thousand and ten thousand quetzales. (See Guatemalan 5 Case 1:13-cv-22131-JLK Document 18-2 Entered on FLSD Docket 09/20/2013 Page 6 of 10 Criminal Code, Articles 274 "A" and 274 "B"). Moreover, anyone who copies or, in any way, reproduces the programming or rights-management instructions or applications used by a computer software program, without the authorization of the copyright owner, shall be punished with imprisonment of six months to four years and fined between five hundred to twenty-five hundred quetzales. (See Guatemalan Criminal Code, Article 274 "C"). Furthermore, the Guatemalan Criminal Code provides that anyone who sells, licenses/leases, or otherwise distributes versions of an original covered work, without the authorization of the author or copyright owner, shall be punished with imprisonment of between one and six years and fined between fifty thousand and seven hundred and fifty thousand quetzales. (See Guatemalan Criminal Code, Article 274). 13. In the year 2006, the Guatemalan Congress passed some amendments to the Guatemalan Copyright Law, which were published as Decereto No 11-2006 and became effective on May 5, 2006. Among other things, Decreta No 11-2006: (a) recognized criminal copyright crimes as "public actions," thus authorizing law enforcement authorities to arrest suspected infringers and seize illegal "pirated" software programs and computer equipment; (b) substantially expanded the number of infringing acts, creating new crimes that, as described above, penalize the circumvention of copy-protection technologies and the removal or alteration of programming or rights management information from computer software programs; (c) created the "Fiscalia de Seccion de Delitos Contra Ia Propiedad lntelectual" (the "Office of the Special Prosecutor for Intellectual Property Crimes") (hereinafter, referred to as, 6 Case 1:13-cv-22131-JLK Document 18-2 Entered on FLSD Docket 09/20/2013 Page 7 of 10 the "Guatemalan Special Prosecutor 11 ), as part of the "Office of the Attorney General, 112 to have exclusive responsibility for prosecuting criminal copyright infringements; and (d) established procedures for the Guatemalan Special Prosecutor or an aggrieved copyright owner to request and obtain precautionary remedial measures from a court of competent jurisdiction in both criminal and civil copyright infringement actions. {See generally, Guatemalan Copyright Law, Articles 123 - 134 ). 14. The Guatemalan Copyright law provides, in pertinent part, that the Guatemalan Special Prosecutor shall have responsibility for the prosecution of criminal actions against persons who commit felonies and misdemeanors, as established under the Guatemalan Copyright law, the Guatemalan Criminal Code, and other laws. (See Guatemalan Copyright Law, Article 127). Pursuant to the Guatemalan Copyright law, the owner or holder of a copyright (or a consumer organization or trade association that adequately represents the interests of the owner or holder of a copyright) may cause the Guatemalan Special Prosecutor to initiate criminal proceedings against an infringing party by filing a complaint with the Guatemalan Special Prosecutor describing and offering evidence of the alleged infringing acts. (See id.) The law the Guatemalan Special Prosecutor to take 11 direct and immediate action 11 against the infringing parties. {See id.) The Guatemalan Special Prosecutor, either sua sponte or at the request of the owner or holder of the copyright, and in accordance with the 11 C6digo Procesal Penal de Guatemala" (the 11 Guatemalan Code of Criminal Procedure"), shall request that a court of competent jurisdiction order any precautionary remedial measure permitted 2 Several of the English-language translations which are attached as exhibits to the Complaint refer to the Guatemalan Special Prosecutor generally as the 11 Attorney General." 7 Case 1:13-cv-22131-JLK Document 18-2 Entered on FLSD Docket 09/20/2013 Page 8 of 10 under Article 128bis. of the Guatemalan Copyright Law as necessary to safeguard the rights of the owner or holder of the copyright which is or may soon be infringed. (See Guatemalan Copyright Law, Article 128). The court, in turn, is required to act "urgently" and rule on the Guatemalan Special Prosecutor's request so as to enable the Guatemalan Special Prosecutor to implement (with the aid of the local police authority, as the situation may require) the, precautionary remedial measure(s) necessary to address an actual or imminent violation. 3 (See id.) 15. The precautionary remedial measures available under Article 128bis. of the Guatemalan Copyright Law, include the following: (a) The immediate cessation of the unlawful or infringing acts; (b) The search of public or private properties, whether opened or closed; (c) The seizure of real and personal property, including, but not limited to, bank accounts held by companies or individuals identified as possible perpetrators or accomplice responsible for the reported illegal act, and seizure of the alleged infringing party's net profits; (d) The immediate seizure or confiscation of copies illegally produced from protected works and/or the instruments used to produce, transport, store, distribute, offer for sale, rent or communicate them to the public in any way; 3 Article 181 of the Guatemalan Code of Criminal Procedure provides that, unless otherwise established by the criminal law, the Attorney General and the courts must examine the admissible evidence to seek out the "truth" concerning the alleged infringing acts. (See Guatemalan Code of Criminal Procedure, Article 181). 8 Case 1:13-cv-22131-JLK Document 18-2 Entered on FLSD Docket 09/20/2013 Page 9 of 10 (e) An order to review accounting files for natural or juridical persons identified as potentially responsible for the infringing act; (f) The temporary closure of the store or business where illegal copies of the protected works are found, as well as any other infringing merchandise, media or instruments used to produce them; 4 (g) The seizure of the accounting books or the computers that contains them of the persons of corporations whom may be liable for the felony; (h) Other temporary measures (implemented through binding orders) that, based on the circumstances, appear more appropriate in order to bring about a temporary cessation of the crime, while protecting rights recognized by this law or preserving evidence or proof related to an actual or imminent violation. (See Guatemalan Copyright Law, Article 128bis). 16. The Guatemalan Copyright Law contemplates that the owner or holder of the copyright and the alleged infringing party may agree to an 11 0Ut-of-court" monetary settlement of the dispute. "If there is agreement between the victim and the person or persons accused of the unlawful criminal act, and the former has been satisfactorily compensated or duly guaranteed payment for the damages caused by the commission of the crime by the latter, the criminal infringement action may be terminated." (Guatemalan Copyright Law, Article 128ter). 4 Any such measure shall remain in place for whatever time is necessary in order to ensure the results of the process, and may not be lifted while a risk of repeat violation exists or other infringement of rights established by law and in treaties regarding copyright and other related rights of which Guatemala is a party. (See Guatemalan Copyright Law, Article 128bis). 9 Case 1:13-cv-22131-JLK Document 18-2 Entered on FLSD Docket 09/20/2013 Page 10 of 10 17. Besides authorizing the Guatemalan Special Prosecutor to criminally prosecute copyright infringement claims, the Guatemalan Copyright Law also permits the owners or holders of copyrights to file civil copyright infringement actions. (See Guatemalan Copyright Law, Article 133). Civil copyright infringement actions are governed by the "C6digo Procesal Civil y Mercantil de Guatemala" (the "Guatemalan Code of Civil and Mercantile Procedures" or "Guatemalan Code of Civil Procedure"), and applicable provisions of the Guatemalan Copyright Law. (See Guatemalan Copyright Law, Article 133). Just like in a criminal copyright infringement prosecution, a court of competent jurisdiction may order precautionary remedial measures to protect the rights of the aggrieved holder or owner of the copyright, prevent the commission of an alleged infringing act, avoid the consequences of an alleged infringing act, or preserve evidence for trial. (See Guatemalan Copyright Law, Article 133bis). 18. The "statute of limitation" for a civil action arising under the Guatemalan Copyright Law is five (5) years from the date of discovery of the alleged infringing act. (See Guatemalan Copyright Law, Article 134). A civil copyright infringement claim may be asserted jointly or independently of a criminal prosecution concerning the same alleged infringing conduct. (See id.) II. Summary of Complaint Allegations and Terms of the Settlement Agreement 19. Based upon my review of the Complaint, plaintiffs' allegations center on a criminal (not a civil) copyright infringement action brought by the Guatemalan Special Prosecutor, like the ones I generally described in paragraphs 14-16, above. The crux of plaintiffs' allegations appears to be that Microsoft "abused" the legal process of Guatemala, "maliciously prosecuted" the plaintiffs by filing a "fraudulenf' copyright infringement complaint 10 Case 1:13-cv-22131-JLK Document 18-3 Entered on FLSD Docket 09/20/2013 Page 1 of 11 (accompanied by "false" or "perjured" sworn statements), and/or "defrauded" the court in Guatemala in that proceeding. Specifically, plaintiffs allege that Microsoft - either directly or through its affiliate, Microsoft de Guatemala, S.A. ("Microsoft Guatemala") - filed a "false" or "fraudulent" copyright infringement complaint 5 with the Guatemalan Special Prosecutor to improperly secure the issuance of an order by a Guatemalan court, which authorized the Guatemalan Special Prosecutor to take certain precautionary remedial measures against the plaintiffs. (See 13-17, 28, 31-35, 65, 73). 20. The documents attached as exhibits to the Complaint in this case, include the "criminal complaint" submitted by Microsoft to the Guatemalan Special Prosecutor requesting that the Guatemalan .. Special Prosecutor institute criminal proceedings against the plaintiffs in Guatemala (see paragraph 14, above), and related filings in those proceedings. On or about April 27, 2012, the Second District Court for Criminal, Narcotics and Environmental Crimes in and for the Municipal District of Guatemala City (the "Guatemalan Criminal Court 11 ) entered an order authorizing the Guatemalan Special Prosecutor, and its authorized agents, to conduct a physical inspection and "audit" of the computer hardware located on plaintiffs' business premises. (See Settlement Agreement, pp. 3 of 20; 7 of 20). As indicated above, such authorization can only be ordered by a Guatemalan court at the request of the Guatemalan Special Prosecutor. (See paragraph 14, above). The "audit" of plaintiffs' business premises was conducted on Apri l 27, 2012. (See Settlement Agreement, p. 3). In the Complaint, plaintiffs allege that Microsoft's representatives "appeared with armed Guatemalan law enforcement 5 Throughout the Complaint in this case, plaintiffs refer to the "criminal complaint" filed by Microsoft with the Guatemalan Special Prosecutor as a "sworn declaration" or "seizure motion," which, technically speaking, is not an accurate description of that document. 11 Case 1:13-cv-22131-JLK Document 18-3 Entered on FLSD Docket 09/20/2013 Page 2 of 11 officers" at plaintiffs' offices on April 27, 2012 (hereinafter, referred to as, the "Apri l 27th Audit"), "halted Plaintiffs' business operations," "extorted" a settlement payment of US$70,000 from plaintiffs, and "coerced" plaintiffs' authorized representative to accept the terms of the Settlement Agreement and execute it under "duress." (See Complaint, ~ ~ 37-40, 43-45, 65, 73, 79-80, 83). I note that although the Complaint alleges that it was Microsoft's representatives who "appeared with armed Guatemalan law enforcement officers" at plaintiffs' offices on April 27, 2012, the type of precautionary remedial measures described in the Complaint are normally carried out, pursuant to Articles 127, 128, and 128bis. of the Guatemalan Copyright Law, by the Guatemalan Special Prosecutor who, in turn, may enlist the assistance of law enforcement officers, as needed. (See paragraphs 14 and 15, above). Ill. Issues of Guatemalan Law Relevant to Microsoft's Motion to Dismiss Based on the Doctrine of Forum Non Conveniens 21. Upon information and belief, Microsoft has filed (or intends to file) a motion to dismiss the Complaint based, in part, on the doctrine of forum non conveniens. I have been asked by Mircrosoft, through its legal counsel in the United States, to opine on whether, if this Court were to dismiss the Complaint on forum non conveniens grounds, Microsoft would be amenable to service of process in Guatemala, and whether the plaintiffs would have a remedy against Microsoft in the courts of Guatemala. It is my expert opinion that Microsoft would be amenable to service or process in Guatemala. Furthermore, in my expert opinion, plaintiffs would potentially have a remedy against Microsoft in Guatemala, based on the conduct alleged in the Complaint. Below, I describe the bases for my opinions. 22. First, with respect to my opinion that Microsoft would be amenable to service of process in Guatemala, I note that, in a case for damages, Article 16 of the Guatemalan Code of 12 Case 1:13-cv-22131-JLK Document 18-3 Entered on FLSD Docket 09/20/2013 Page 3 of 11 Civil Procedure confers "jurisdiction" (a legal concept referred to as "competencia," under Guatemalan jurisprudence) to the judge presiding over the place where the damages are alleged to have occurred. Because the Complaint seeks damages against Microsoft that allegedly were sustained by the plaintiffs in Guatemala - and more specifically, at plaintiffs' business offices in Guatemala City - the Guatemalan court presiding over that location would have "jurisdiction" to hear plaintiffs' claims. 23. In addition, Article 14 of the Guatemalan Code of Civil Procedure provides, in pertinent part, that one who has elected a "domicile," in writing, for purposes of certain acts or matters, may be sued before the judge corresponding to such "domicile." The "criminal complaint" filed by lVlicrosoft with the Guatemalan Special Prosecutor, which is attached as Exhibit "A" to the Complaint in this action, states that, in or around June 19, 2007, Microsoft recorded, with the "Registry of Powers of Attorney at the Judicial Branch's General Archives" of Guatemala, a "notarial' deed" in which it appointed Mr. Rodolfo Estaurdo Varela Martinez to act as Microsoft's duly authorized "power of attorney," and further provides Mr. Varela's address as the "Place of Receiving Notices" in Guatemala. (See Complaint, Exhibit "A" at p. 1}. Because Microsoft registered the address of Mr. Varela- its "power of attorney" - with the Guatemalan authorities, it would appear that Microsoft elected a "domicile" in Guatemala, is capable of being sued in a court presiding over the area where that "domicile" is located, and may receive "notice" of any legal action filed against it in Guatemala at the address of its duly registered "power of attorney." 24. I further note that the parties entered into a Settlement Agreement pursuant to which they agreed that their rights and obligations under the agreement must be performed 13 Case 1:13-cv-22131-JLK Document 18-3 Entered on FLSD Docket 09/20/2013 Page 4 of 11 within the 11 framework of the Guatemalan legal system" (which is described as the 11 0rdenamiento jurfdico guatemalteco" in the Spanish-language original of the Settlement Agreement). (See Settlement Agreement, p. 9, ~ ElEVEN). In my opinion, under Article 2 of the Guatemalan Code of Civil Procedure, the aforementioned provision of the Settlement Agreement constitutes, at a minimum, a 11 tacit" manifestation of the parties' mutual intention to submit to the courts of Guatemala with respect to matters concerning or arising under the Settlement Agreement. 6 25. It is worth noting that the Settlement Agreement states that the aforementioned Mr. Varela represents Microsoft through the exercise of a 11 Special Judicial Power of Attorney," which is consistent with the information about Mr. Varela's authority that is contained in the 11 Criminal complaint," as described above. (See Settlement Agreement, p. 10; see also paragraph 23, above). Accordingly, pursuant to Articles 188 and 190 of the law of the Judicial Branch (Decree of Congress 2-89 and amended), Mr. Varela is invested with all available powers to represent and act on behalf of Microsoft in court proceedings in Guatemala, including, but not limited to, the authority to accept service of process - including of any action arising under or concerning the Settlement Agreement- on Microsoft's behalf in Guatemala. 26. As it relates to my opinion that plaintiffs would potentially have a remedy against Microsoft for damages in Guatemala on the basis of the conduct alleged in the Complaint, I note that, pursuant to the express terms of the Settlement Agreement, plaintiffs waived the right to assert any 11 past, present, or future" claim against Microsoft based on the April 27th 6 Article 2 of the Guatemalan Code of Civil Procedure distinguishes between the terms II express" and 11 tacit," with respect to the manner by which parties may manifest their intent to submit to a court's 11 jurisdiction." 14 Case 1:13-cv-22131-JLK Document 18-3 Entered on FLSD Docket 09/20/2013 Page 5 of 11 Audit or arising out of or relating to the criminal copyright infringement action brought by the Guatemalan Special Prosecutor against the plaintiffs in Guatemala. (See Settlement Agreement, p. 6, ~ S E V E N ) . 27. The Settlement Agreement executed by the parties, is regulated under Guatemalan law by Articles 2151 through 2169 of the "C6digo Civil de Guatemala" (the "Guatemalan Civil Code"). Under Article 2151, a contract, like the Settlement Agreement, is recognized as a valid "agreement in which the parties decided to resolve an unresolved or litigious matter or terminate a pending proceeding." Based on my review of the Complaint and the Settlement Agreement, that is precisely what the Settlement Agreement was designed to accomplish with respect to the parties' dispute in the criminal copyright infringement action brought by the Guatemalan Special Prosecutor. It also is consistent with Article 128ter. of the Guatemalan Copyright law, which, as indicated above, contemplates that the parties may enter into an "out-of-court'" monetary settlement to terminate a criminal copyright proceeding brought by the Guatemalan Special Prosecutor (see paragraph 16, above). 28. Furthermore, the "waiver" of liability/"general release" in the Settlement Agreement constitutes a valid and enforceable "legal undertaking" or "juridical act" ("Negocio Juridico") under Articles 1251, et seq., of the Guatemalan Civil Code, and also is a valid and enforceable obligation under Articles 1319, et seq., of the Guatemalan Civil Code. In particular, Article 1326 of the Guatemalan Civil Code regulates and permits a party to voluntarily agree to "abstain" or "refrain" from exercising any "right." In sum, the "waiver" of liability/"general release" executed by the plaintiffs would be recognized and enforceable under Article 1326 of the Guatemalan Civil Code, given that it constitutes a manifestation of plaintiffs' right to 15 Case 1:13-cv-22131-JLK Document 18-3 Entered on FLSD Docket 09/20/2013 Page 6 of 11 "abstain 11 or "refrain 11 from asserting any "past, present, or future 11 claim against Microsoft, arising out of or relating to the April 27th Audit or the criminal copyright infringement proceeding brought by the Guatemalan Special Prosecutor against the plaintiffs in Guatemala. 29. Under Article 1303 of the Guatemalan Civil Code, any "juridical act" ("Negocio Jurfdico 11 ), including an agreement to settle or resolve a pending dispute or legal proceeding, may be subject to an if it is proven that the agreement was entered into without a party's "consent 11 or against a party's "free will. 11 Plaintiffs' allegations in the Complaint that they entered into the Settlement Agreement under may provide a basis for them to seek an of the Settlement Agreement in a Guatemalan court. In particular, Article 214 of the Guatemalan Criminal Code provides, in pertinent part, that "any person, who, without any legitimate authority, acts with violence or intimidation or, who, in any manner, exerts control over another to compel him or her to act or refrain from acting against his or her free will, 11 commits the crime of which, under Guatemalan law, is known as "coacci6n." In Guatemala, private litigants, like the plaintiffs, are permitted to initiate criminal proceedings with the office of the prosecutor, based upon certain crimes, including ("coacci6n"). 30. In my opinion, based on the allegations in the Complaint, plaintiffs fail to sufficiently plead ("coacci6n") as a matter of Guatemalan law. First, as indicated above, Article 214 of the Guatemalan Criminal Code requires that the person committing the "duressn do so without any legitimate authority. In this case, the alleged acts of - namely the Apri l 27th Audit of plaintiffs' business premises (with the assistance of local law enforcement officers); the potential or possible of plaintiffs' "computer servers 11 and 16 Case 1:13-cv-22131-JLK Document 18-3 Entered on FLSD Docket 09/20/2013 Page 7 of 11 other media; and the "halting" of plaintiffs' business operations, ALL were undertaken pursuant to the legitimate authority granted by the Guatemalan Criminal Court to the Guatemalan Special Prosecutor, and its authorized agents, to implement certain precautionary remedial measures, pursuant to the Guatemalan Copyright Law. (See Complaint, Exhibit "A" ("Criminal Complaint"), at pp. 8-9); Settlement Agreement, p. 3, ~ ONE.RECITALS; p. 6-7, ~ FIVE; p. 7, ~ SEVEN). Therefore, the allegations in the Complaint are insufficient to state a claim for "duress" under Guatemalan law. 31. Additionally, nowhere in the Complaint do plaintiffs allege that Microsoft used violence, force, or intimidation against plaintiffs' authorized representative, Ms. Maria Virginia Rosado Zaldana (the person who executed the Settlement Agreement on plaintiffs' behalf), or any other agent or representative of plaintiffs, or exerted such control over Ms. Zaldaiia or any other agent or representative of plaintiffs, "so as to prevent them from exercising 'free will."' On the contrary, the Settlement Agreement states that it is being entered into "by means of mutual concessions" and upon the "common agreementn of both parties, and further contains an attestation by each of the parties' representatives affirming that he or she is "duly acquainted with the content, purpose, validity and other legal effects" of the agreement. (Settlement Agreement, p. 3, ~ TWO.SETILEMENT; p. 10). 32. Moreover, upon information and belief, the plaintiffs tendered the full amount of the settlement payment (US$70,000). The settlement payment was made in four separate installments of $17,500.00. Three of the installment payments were made over a three (3) month period after the Settlement Agreement was signed and the alleged "duress" occurred (on April 27, 2012). In my opinion, because the plaintiffs continued to comply with the terms of 17 Case 1:13-cv-22131-JLK Document 18-3 Entered on FLSD Docket 09/20/2013 Page 8 of 11 the Settlement Agreement for several months after the agreement was signed and the alleged "duress" occurred - and did so without disputing the terms of the agreement in a Guatemalan court or with the Guatemalan Special Prosecutor or refusing to tender any portion or installment of the settlement payment to Microsoft - plaintiffs have effectively uratified" the Settlement Agreement and/or 11 Waived" any right to claim they agreed to its terms under "duress/' as a matter of Guatemalan law. 33. In addition to the criminal remedy for "annulment" described above, Guatemalan law also provides a civil remedy for the of a contract. Civil 11 annulment" actions are governed under the Guatemalan Code of Civil Procedure, which permits the recovery of monetary damages suffered by a plaintiff as a result of the enforcement of a contract to which he or she did not freely or voluntarily consent. 34. To the extent plaintiffs were able to successfully have the Settlement Agreement 11 annulled" by a court in Guatemala (thereby also nullifying the 11 Waiver" of liability/"general release" provision in the agreement), plaintiffs could potentially assert other claims against Microsoft. For instance, plaintiffs' core allegations in this case are that Microsoft essentially engaged in an 11 abuse of process" or the "malicious prosecution" of the plaintiffs, or committed a 11 fraud on the court," by virtue of filing a 11 false" or "fraudulent" criminal complaint and "sworn declarations" with the Guatemalan Special Prosecutor and Guatemalan Criminal Court. In Guatemala, Microsoft's alleged conduct, if true, could be subject to penalty under the Guatemalan Criminal Code, in particular, Articles 453, 454 and 455, and plaintiffs would be permitted to file a criminal complaint against Microsoft on the basis of those allegations. 35. Furthermore, under Article 1653 of the Guatemalan Civil Code, plaintiffs 18 Case 1:13-cv-22131-JLK Document 18-3 Entered on FLSD Docket 09/20/2013 Page 9 of 11 also would be free to pursue a cause of action for "abuse of rights," ("Abusos del Derecho"). Under that cause of action, plaintiffs could seek the recovery of monetary damages against Microsoft. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 19 Case 1:13-cv-22131-JLK Document 18-3 Entered on FLSD Docket 09/20/2013 Page 10 of 11 FURTHER DECLARANT SAYETH NAUGHT. I declare under penalty of perjury under the laws of the United States of America that the foregoing is true and correct and that this declaration was executed on this 20th day of September, 2013. 20 Case 1:13-cv-22131-JLK Document 18-3 Entered on FLSD Docket 09/20/2013 Page 11 of 11