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BP Amoco Chemical Co. v. Flint Hills Resources

May 4, 2009

BP AMOCO CHEMICAL COMPANY, PLAINTIFF/COUNTER--DEFENDANT,
v.
FLINT HILLS RESOURCES LLC, DEFENDANT/COUNTER--PLAINTIFF.
FLINT HILLS RESOURCES LLC, THIRD-PARTY PLAINTIFF,
v.
BP CORPORATION NORTH AMERICA INC., DEFENDANT.



The opinion of the court was delivered by: Judge Amy J. St. Eve

Motion Ex. 21

REPLY IN SUPPORT OF DAUBERT MOTION NO. 1:

FHR'S PRINCIPAL DAMAGES EXPERTS BP AMOCO CHEMICAL COMPANY AND BP CORPORATION NORTH AMERICA INC.'S REPLY IN SUPPORT OF THEIR MOTION TO EXCLUDE THE OPINIONS OF SHARON MOORE BETTIUS AND JEFFREY BALIBAN

TABLE OF CONTENTS

I. BALIBAN'S AND BETTIUS' OPINIONS SHOULD BE EXCLUDED BECAUSE NEITHER HAS APPLIED A RELIABLE METHODOLOGY. .....................1

A. Baliban And Bettius Have Failed To Calculate The Joliet Plant's Fair Market Value In An "As-Represented" Condition On The Date Of Closing. ....................................................................................................................1

B. FHR Admits That Bettius Uses An Improper Methodology That Would Award Damages For Factors Independent Of Any Alleged Breach Or Fraud. .......................................................................................................................3

C. FHR's Response Confirms That Bettius Has No Methodology To Determine The Amounts Of Her Adjustments And Discounts. ..............................4

D. FHR's Response Confirms That Baliban Calculated An Investment Value, Not The Legally Required FMV..............................................................................6

E. FHR's Response Confirms That Using The IRR To Discount Cash Flows Is An Improper Methodology. .................................................................................8

II. FHR'S RESPONSE CONFIRMS THAT BETTIUS' AND BALIBAN'S OPINIONS DO NOT FIT THE FACTS OF THIS CASE. .................................................9

A. FHR's Argument That Bettius Did Not Perform A Dollar-For-Dollar Analysis Admits That Bettius Does Not Use A Reliable Methodology..................9

B. Bettius' Assumption Of No Representations And Warranties At All Is Inconsistent With FHR's Own Allegations. ..........................................................10

C. Baliban's Use Of Speculative Cash Flows Renders His Opinion Inadmissible. ..........................................................................................................11

D. Baliban's Production Capacity Assumptions Contradict Another Of FHR's Proposed Experts. ..................................................................................................12

III. BETTIUS AND BALIBAN'S OPINIONS ARE INCONSISTENT WITH THE PSA. ...................................................................................................................................13

A. Baliban's and Bettius' Opinions Violate § 13.6's Bar On Lost Profits.................14

B. Baliban and Bettius Ignore The PSA's Binding Purchase Price Allocation..........14

C. Baliban's Opinion Fails To Mitigate Damages. ....................................................15

CONCLUSION..............................................................................................................................15

TABLE OF AUTHORITIES

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