8630 1 IN THE IOWA DISTRICT COURT FOR POLK COUNTY ----------------------------------------------- 2 JOE COMES; RILEY PAINT, ) 3 INC., an Iowa Corporation;) SKEFFINGTON'S FORMAL ) 4 WEAR OF IOWA, INC., an ) NO. CL82311 Iowa Corporation; and ) 5 PATRICIA ANNE LARSEN; ) ) TRANSCRIPT OF 6 Plaintiffs, ) PROCEEDINGS ) VOLUME XXXII 7 vs. ) ) 8 MICROSOFT CORPORATION, ) a Washington Corporation, ) 9 ) Defendant. ) 10 ----------------------------------------------- 11 The above-entitled matter came on for 12 trial before the Honorable Scott D. Rosenberg 13 and a jury commencing at 8 a.m., January 17, 14 2007, in Room 302 of the Polk County 15 Courthouse, Des Moines, Iowa. 16 17 18 19 20 HUNEY-VAUGHN COURT REPORTERS, LTD. 21 Suite 307, 604 Locust Street 22 Des Moines, Iowa 50309 23 (515)288-4910 24 25 8631 1 A P P E A R A N C E S 2 Plaintiffs by: MICHAEL E. JACOBS 3 MICHAEL R. CASHMAN Attorneys at Law 4 Zelle, Hofmann, Voelbel, Mason & Gette, LLP 5 500 Washington Avenue South Suite 4000 6 Minneapolis, MN 55415 (612) 339-2020 7 ROBERT J. GRALEWSKI, JR. 8 Attorney at Law Gergosian & Gralewski 9 550 West C Street Suite 1600 10 San Diego, CA 92101 (619) 230-0104 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 8632 1 Defendant by: DAVID B. TULCHIN 2 SHARON L. NELLES JOSEPH E. NEUHAUS 3 Attorneys at Law Sullivan & Cromwell, LLP 4 125 Broad Street New York, NY 10004-2498 5 (212) 558-3749 6 STEPHEN A. TUGGY Attorney at Law 7 Heller Ehrman, LLP 333 South Hope Street 8 Suite 3900 Los Angeles, CA 90071-3043 9 (213) 689-0200 10 DAVID E. JONES Attorney at Law 11 Heller Ehrman, LLP One East Main Street 12 Suite 201 Madison, WI 53703-5118 13 (608) 663-7460 14 BRENT B. GREEN Attorney at Law 15 Duncan, Green, Brown & Langeness, PC 16 Suite 380 400 Locust Street 17 Des Moines, IA 50309 (515) 288-6440 18 19 20 21 22 23 24 25 8633 1 (The following record was made out of 2 the presence of the jury at 8 a.m.) 3 THE COURT: Did you guys want to talk 4 about this trade press thing? 5 MR. GREEN: Yes, Your Honor. 6 Since I raised the objection, let me 7 tell you what we've found out. 8 At one point we did say to them that 9 we objected to the display. Mr. Tuggy sent an 10 e-mail on December 13th. 11 Subsequent to that, however, a chart 12 was sent over by another member of our team, 13 and in that we did say about this exhibit, that 14 exhibit will not be admitted, but Plaintiffs 15 may display the portions of this exhibit 16 referenced in the testimony. And we'll honor 17 that. 18 Even though I think that that was 19 maybe inadvertent, we'll honor that. 20 THE COURT: Okay. 21 MR. GREEN: However, we want to make 22 sure it is limited to what's referenced in the 23 testimony and what's displayed. 24 And we would ask that since it is 25 going to be displayed, it clearly is hearsay, 8634 1 and it's only being displayed because of the 2 reference in the deposition. 3 So we would ask pursuant to the 4 McElroy case that there be a limiting 5 instruction given with regard to it and we will 6 hand the Court what we would propose in that 7 regard. And I think that's -- 8 THE COURT: Would that be given after 9 -- when do you propose this instruction be 10 given, right after that segment? 11 MR. GREEN: Yes. 12 THE COURT: All right. 13 MR. GREEN: That would be our 14 preference, Your Honor. 15 THE COURT: Okay. 16 Mr. Cashman or Mr. Jacobs? 17 MR. CASHMAN: Your Honor, Michael 18 Cashman for the Plaintiffs. 19 Plaintiffs object to the giving of 20 this instruction because there was an agreement 21 that it could be displayed without instruction. 22 And just by way of -- backing up a 23 little bit, yesterday I told the Court I 24 thought 5166 had been discussed during 25 Mr. Chestnut's exhibit argument, and I stand 8635 1 corrected. 2 I went back and looked at the record 3 and we didn't discuss that specific exhibit. 4 THE COURT: I looked too. 5 MR. CASHMAN: And so I just wanted to 6 let the Court know that. 7 But we did confirm that Mr. Silverman, 8 on behalf of Microsoft, agreed to have 5166 9 displayed without instruction. And the only 10 limitation on 5166 is that Plaintiffs would not 11 move for its admission into evidence. 12 THE COURT: Was that in the chart, 13 that agreement? 14 MR. GREEN: No, Your Honor. There's 15 no -- there's nothing about without 16 instruction. It just says it can be displayed. 17 That portion only that is referred to in the 18 deposition testimony. There's nothing in the 19 chart. I can give the Court the chart if you'd 20 like. 21 THE COURT: No. I've got the chart. 22 MR. GREEN: I think the Plaintiffs 23 gave it to you. 24 Also, Your Honor, so we would press 25 for the instruction and say that it is called 8636 1 for once the Jury sees it, just to make sure 2 that they know it's not being admitted for the 3 truth of the fact asserted in the trade press. 4 THE COURT: Okay. 5 MR. GREEN: Also, Your Honor -- and 6 this is just for purposes of Plaintiffs -- the 7 exhibit is again referred to later on in the 8 deposition. 9 THE COURT: Same depo? 10 MR. GREEN: Yes, Your Honor. 11 THE COURT: Okay. 12 MR. GREEN: On the Chestnut 13 deposition. It's at page 169, starting at line 14 21. And we don't think that there's any need 15 to display -- we would ask that it not be 16 displayed during that reference because it just 17 -- it's only been up. 18 And what it says is can you go back to 19 Exhibit 900 -- and that's this Exhibit 5166 -- 20 one of the first exhibits that we looked at 21 this morning. Question -- that was another 22 question. It's the Ray Duncan article. 23 Question: This article came out 24 September 25, 1990; correct? 25 Answer: Correct. 8637 1 Question: This is the one that gives 2 a good review of DR-DOS 5.0; right? 3 Answer: Uh-huh. 4 Question: Do you have an opinion as 5 to what an article like that would do in terms 6 of credibility for DR-DOS 5.0? 7 Answer: I'm sure it would enhance it. 8 Question: Was that a concern to you 9 at Microsoft? 10 Answer: Later on. 11 Question: Was it a concern at the 12 time? 13 Answer: I guess. 14 We don't think it should be displayed 15 -- should not be displayed during that colloquy 16 because it's already been displayed before and 17 the Jury is going to know what they are talking 18 about. 19 MR. CASHMAN: Your Honor. 20 THE COURT: Yes. 21 MR. CASHMAN: With respect to the 22 agreement that the parties have on an exhibit 23 such as 5166, there are instances where the 24 parties have agreed during the meet-and-confer 25 process on these exhibits whether instructions 8638 1 need to be given, limiting instructions. 2 And the parties have agreed in other 3 instances that although an exhibit is not going 4 to be admitted or is just going to be 5 displayed, that no instructions need to be 6 given. 7 And that process has been going on 8 with respect to every single witness, which is 9 why I say in addition to the materials which I 10 handed up to the Court yesterday that there was 11 an agreement that no instruction had to be 12 given for 5166. 13 And as far as Mr. Green's request that 14 5166 not be displayed during one portion of the 15 testimony when Mr. Chestnut refers back to it, 16 again, it is appropriate because it was agreed 17 upon and because it is appropriate for the 18 understanding of what Mr. Chestnut is 19 testifying about. 20 THE COURT: So that first part you 21 talked about, you said there was an agreement 22 between the parties that no -- in general, no 23 limiting instructions would be given? 24 MR. CASHMAN: No. On a case-by-case 25 basis, Your Honor, when we come across this 8639 1 situation, the parties discuss whether or not 2 they think a limiting instruction needs to be 3 given. 4 THE COURT: I get you. 5 MR. CASHMAN: And because nobody 6 insisted on a limiting instruction being given 7 for this particular exhibit, therefore, it was 8 agreed there was no need for a limiting 9 instruction on this one. 10 MR. GREEN: Your Honor, I've been told 11 by Mr. Tuggy -- he can speak to it if you'd 12 like, if you want him to and with the 13 permission of the Plaintiffs -- but I've been 14 told that there was no agreement whatsoever on 15 limiting instructions one way or the other. No 16 prior agreements were made one way or the 17 other. 18 We think that the McElroy case calls 19 for it and it should be given. 20 THE COURT: Yeah, I think Mr. Cashman 21 clarified that. They said they talked on a 22 case-by-case basis. But there was no general 23 agreement? 24 MR. TUGGY: Correct. 25 THE COURT: Okay. Anything else on 8640 1 this? 2 MR. CASHMAN: Just one last point. 3 The reason -- one additional reason why the 4 Plaintiffs oppose this additional instruction 5 at this time because there's been other 6 instances, for example, by Microsoft in opening 7 statement about trade press. 8 Your Honor will recall that we 9 objected to that, but there was no limiting 10 instruction given. So it would seem out of 11 place to give one instruction for one specific 12 exhibit. 13 If we're going to do something along 14 these lines, Plaintiffs would suggest something 15 that's given separate and apart from 16 Mr. Chestnut's testimony that the parties work 17 out concerning trade press. 18 THE COURT: Was there a -- did you 19 guys ask for an instruction on other stuff 20 similar to this? 21 MR. CASHMAN: I know that we asked for 22 the instruction on that piece of trade press 23 that Mr. Holley used with Mr. Alepin, but I 24 don't recall the exact other instances right 25 now. 8641 1 THE COURT: Okay. That one I allowed, 2 I think, for a different reason. Okay. 3 Anything else? 4 MR. GREEN: No, Your Honor. Just the 5 same point that you raised. 6 If they wanted an instruction, they 7 didn't ask for it, and we are asking for it 8 here. 9 MR. CASHMAN: Nothing further for 10 Plaintiffs, Your Honor. 11 THE COURT: Okay. 12 Court -- well, then the parties have 13 agreed to display it. I believe it can be 14 displayed at both places where Chestnut refers 15 to it, and Plaintiffs may show those portions 16 actually referred to or necessary for context 17 in Mr. Chestnut's testimony. 18 I will give an instruction regarding 19 5166. And if the Plaintiffs desire any 20 instructions regarding other exhibits that 21 aren't offered for the truth of the matter 22 asserted or the Defendant wishes it, I'll be 23 happy to do the same. 24 Anything else? 25 MR. GREEN: Thank you, Your Honor. 8642 1 MR. CASHMAN: Yes, Your Honor. 2 With that ruling, Your Honor, I would 3 just make one request of a revision in the 4 proposed instruction that Mr. Green handed up. 5 And that is in the last sentence to 6 strike the word understanding and to put a 7 period after the word testimony. So that the 8 last sentence would regard portions of the 9 article were shown to you only to provide 10 context for Mr. Chestnut's testimony. 11 THE COURT: Anything else? 12 MR. GREEN: I don't think it makes a 13 lot of difference, Your Honor. 14 THE COURT: I have no problem with 15 that. I'll do that. I'll be happy to. 16 Mr. Tulchin? 17 MR. TULCHIN: Your Honor, there is 18 another issue if we may. 19 Mr. Neuhaus will address this. This 20 pertains to the Court's ruling yesterday 21 concerning one of the motions argued last 22 Friday, and we have just an issue that I think 23 is more in the way of clarification. 24 If the Court pleases, Mr. Neuhaus will 25 address this. 8643 1 MR. NEUHAUS: Your Honor, if I might, 2 we have a letter that lays out the position 3 very briefly. If I could approach and give 4 that to Your Honor. 5 THE COURT: Will the Plaintiffs be 6 given a copy? 7 MR. NEUHAUS: I'll give it to them 8 right now. 9 Just briefly, Your Honor -- 10 MR. CASHMAN: May we have a moment to 11 read this, Your Honor, before Mr. Neuhaus 12 proceeds? 13 THE COURT: Certainly. 14 MR. CASHMAN: Okay, Your Honor. We're 15 ready to listen to Mr. Neuhaus. 16 THE COURT: I am too. 17 MR. NEUHAUS: This relates to the 18 order, Your Honor, that we received yesterday 19 with respect to the Plaintiffs' motion to 20 modify the protective order to share 21 Mr. Schulman's findings with the government 22 regarding supposed violations of the final 23 judgment in the government action. 24 And we don't oppose their ability to 25 approach the government. Our only concern has 8644 1 been throughout this making sure that our 2 source code is protected. 3 In certain circumstances, there would 4 be no problem at all. If they approach the 5 technical committee, for example, that was set 6 up on the final judgment, our source code would 7 be perfectly protected, but under the order 8 that Your Honor issued, they can approach the 9 DOJ or the Plaintiffs states directly. And if 10 the Plaintiffs states, for example, requested, 11 purely requested the source code, the 12 protective order would permit the -- the order 13 yesterday would permit them to provide the 14 source code to the states. 15 And, under certain circumstances, 16 we're concerned that there wouldn't be adequate 17 protection of our -- there would be no 18 protection of our protective order -- of our 19 source code, sorry, or at least that could be 20 the case. 21 So our concern is just that we get 22 notice so that we can seek clarification or 23 protection if needed from the Court in 24 Washington or wherever would be appropriate. 25 When Mr. Jacobs argued this, he said 8645 1 it should be our burden to seek any such 2 clarification, and we can certainly live with 3 that burden. We just want to have a chance to 4 do that. But to know what path the information 5 is taking to get to the government. 6 As I said, in certain circumstances, 7 there would be no problem. There's only 8 protections built in. 9 Under the order yesterday, because it 10 could get to the government in other ways, such 11 as by an informal request where we wouldn't 12 have that protection, we want to make sure that 13 we can go into court if need be and get that 14 protection. 15 We ask for reasonable notice, 10 16 business days' notice, before they actually 17 turn anything to be able to decide if we need 18 to take any action. 19 MR. JACOBS: Your Honor. 20 THE COURT: Mr. Jacobs, you get to 21 speak. 22 MR. JACOBS: I do get to speak, Judge. 23 THE COURT: All right. 24 MR. JACOBS: I'm not entirely certain 25 what sort of notice Microsoft -- additional 8646 1 notice Microsoft is asking for here. 2 We filed a motion where we indicated 3 the entities -- the enforcement authorities we 4 wished to discuss these issues with. 5 Microsoft has been on notice now for 6 close to a month now that we intend -- we would 7 like to go forward and speak to certain 8 enforcement authorities. 9 If Microsoft wants to go to the Court 10 in Washington, D.C. now in light of Your 11 Honor's order, it seems like it ought to be up 12 to Microsoft to go to the Court now, not wait 13 to put some additional burdens in the process 14 of disclosing any sort of information to these 15 authorities. 16 Timing under this judgment, under the 17 final judgment is very important, Your Honor. 18 Timing is not something where -- the timing 19 here is not something where we can just wait 20 and put this off further and further and 21 further. 22 Under the final judgment, Microsoft 23 actually -- let me back up here. 24 Microsoft is obligated under the final 25 judgment to provide disclosures of APIs, 8647 1 application programming interfaces, that are 2 used by its middleware products before those 3 products actually hit market. 4 With Internet Explorer 7, for 5 instance, which was released to the public in 6 final version this last fall, Microsoft 7 actually had an obligation to provide 8 disclosures of all applications programming 9 interfaces used by Internet Explorer in Windows 10 at the time of the final beta version of 11 Internet Explorer 7. In other words, before 12 the final release. 13 Why is that? It's because the final 14 judgment recognizes the importance of time to 15 market and timely disclosure of this 16 information. 17 So this notion that we can just keep 18 pushing the stuff off further and further and 19 further and that there will be no harm in just 20 a couple more weeks' time here before we are 21 able to contact the enforcement authorities 22 just does not jive with how the final judgment 23 is supposed to work. 24 They've known who we want to go to. 25 They know who we want to speak with. 8648 1 We are not going to be disclosing the 2 source code. I don't think Your Honor's order 3 allows us to just go ahead and disclose the 4 source code immediately to these parties. 5 Your Honor said we can go contact 6 these parties and tell them the substance of, 7 hey, here's the information that we have. 8 We can share the basis of this 9 information later through subpoena or other 10 request from the government authorities, but 11 certainly we should be able to go forward now, 12 contact these parties immediately, and not have 13 to wait for some additional steps in the 14 process to be built in because Microsoft at 15 some later point wants to go and deal with any 16 sort of confidentiality issues. 17 MR. NEUHAUS: Your Honor, we have no 18 objection to their approaching the government 19 authorities under the relevance -- the first 20 part of your order. 21 It's in between that. If the request 22 comes, you know -- if the request is a subpoena 23 from the Department of Justice, there's no 24 problem. There's statutory protection for that 25 material. 8649 1 If the request comes as an informal 2 request from the state, it's un- -- there may 3 not be protection from, for example, a FOIA 4 request or something like this under the state 5 statute. 6 So what we are seeking is not to stop 7 them from approaching the government now in 8 what Your Honor's ruling is contemplating. 9 It's under the second part where there is a 10 wide array of potential ways in which the 11 information could get to the government where, 12 you know, we want to be able to deal with 13 whatever actually happens. 14 As I said, under a number of 15 scenarios, not a problem at all. It goes 16 straight to the technical committee, it's all 17 absolutely fine, which is the path that the 18 final judgment envisions for third-party 19 complaints. 20 And if they approach the technical 21 committee, provide the information to the 22 technical committee, it's all absolutely 23 protected. 24 But if they approach an individual 25 plaintiff state, it's a lot less clear what the 8650 1 story is. And all we want is notice in between 2 those two steps. 3 How is it going to actually happen if 4 the source code is going to be released so 5 that, if we need to, we can take steps to 6 protect it. 7 THE COURT: Anything else? 8 MR. JACOBS: Well, just one final 9 thing. It seems like at this point Microsoft 10 could be taking those steps to -- here's my 11 understanding of Microsoft's concern with the 12 protective order in the government case. 13 Seems to be that because any 14 information received from the Plaintiffs in 15 this case would not be considered Microsoft 16 information, Microsoft confidential information 17 for purposes of the protective order in the 18 government case. 19 Microsoft says because it's coming 20 from a third party, us, that somehow it 21 wouldn't be given the same treatment as 22 confidential information provided directly by 23 Microsoft. 24 I can't believe that if Microsoft were 25 to go to the Court or the parties now and say 8651 1 in light of this ruling by the district court 2 in Iowa that, you know, we want to just clarify 3 the protective order, that if any information 4 comes from the Plaintiffs -- Microsoft 5 information comes from the Comes Plaintiffs 6 that it was internal to Microsoft that it will 7 be treated as Microsoft, confidential 8 information produced by Microsoft directly in 9 the government case. 10 THE COURT: Anything else on this 11 issue? 12 MR. NEUHAUS: No, Your Honor. 13 THE COURT: I don't have time now, but 14 during the first break, I will issue an order 15 one way or the other on this request. 16 MR. NEUHAUS: Thank you, Your Honor. 17 THE COURT: All right. 18 MR. CASHMAN: Your Honor, Plaintiffs 19 have something very quickly. 20 We'd like to provide an exhibit which 21 we have labeled as an offer of proof. 22 THE COURT: Okay. 23 MR. CASHMAN: This is financial 24 evidence for the stockholdings of Mr. Chestnut 25 under the employee stock purchase plan. And 8652 1 this information was provided in response to 2 Interrogatory Number 21. 3 The Plaintiffs intend to offer -- make 4 such offers of proof for each and every 5 Microsoft employee. And I just wanted to make 6 this offer of proof for Mr. Chestnut 7 contemporaneous with his testimony. 8 It will be discussed further tomorrow 9 by Ms. Conlin. I understand there's a motion 10 on regarding financial information like this. 11 So there will be further explanation 12 for the Court on it tomorrow. 13 I just wanted it to be offered 14 contemporaneous with Mr. Chestnut's testimony. 15 THE COURT: So you want this as an 16 exhibit? 17 MR. CASHMAN: I think that Ms. Conlin 18 will address that during -- 19 THE COURT: Tomorrow? 20 MR. CASHMAN: During the motion. 21 THE COURT: I'll wait until tomorrow. 22 MR. CASHMAN: Yes. 23 MR. TULCHIN: And I understand, Your 24 Honor, this will not be shown to the Jury until 25 at least after the time that Ms. Conlin's 8653 1 motion tomorrow is decided? 2 MR. CASHMAN: That's correct. 3 MR. TULCHIN: Thank you. 4 THE COURT: Okay. Anything else? 5 Mr. Tuggy, you were anxious there. 6 MR. TUGGY: I have an agreement to 7 report involving Motion Number 10, and if I may 8 approach the Court. 9 THE COURT: Really? 10 MR. TUGGY: This obviates the need for 11 oral argument on this motion. Ms. Davis and I 12 have discussed it and I have provided a letter 13 to Mr. Cashman and I told Ms. Davis I will 14 report this to the Court. 15 This is a motion asking that you rule 16 on two exhibits in the Phase 6 appeals that 17 weren't ruled on before and so this is our 18 agreement that you may go ahead and rule on 19 that. 20 THE COURT: That's wonderful. Thank 21 you. 22 MR. CASHMAN: The parties are in 23 agreement on that, Your Honor. 24 THE COURT: And I want to take a 25 moment to tell the parties that I recognize 8654 1 that you have endeavored to in good faith 2 resolve many of these issues, evidentiary and 3 otherwise, and I appreciate it very much. 4 And although I sometimes believe we 5 revisit the same rulings in more than one 6 occasion, in comparison, though, what you guys 7 have done on both sides in resolving many, 8 many, many issues between you that the Court 9 has not agreed to address has saved a lot of 10 time and I'm grateful for that. 11 And I have been remiss in recognizing 12 that fact and I'm sorry. So I want to commend 13 the attorneys for both sides for your hard work 14 and your efforts to resolve, or at least pair 15 down your differences in a manageable level for 16 yourselves and for the Jury and for the Court. 17 I know that all of you work very hard, 18 and you continue to work hard for very long 19 hours, but I also know that your motions, your 20 briefs, and your arguments and the ruling 21 charts are not only very well done, I 22 appreciate them very much. They're thoughtful, 23 exceptional, and they're extremely helpful. 24 And I greatly appreciate it. 25 So I just wanted to mention that and 8655 1 thank you for your hard work and your endeavors 2 and for your cooperation with the Court, with 3 each other, your helpfulness, your courtesy and 4 your patience and your professionalism. Thank 5 you very much to both sides. 6 MR. CASHMAN: Thank you, Your Honor. 7 MR. TULCHIN: Thank you, Your Honor. 8 Microsoft very much appreciates the 9 Court's comments. Thanks. 10 MR. CASHMAN: Plaintiffs appreciate 11 your comments also. 12 THE COURT: Well, I'm sincerely making 13 them. 14 MR. CASHMAN: We have one more brief 15 matter, and this concerns the question by the 16 Jury yesterday about speeding up the 17 depositions. And we had some discussion about 18 it yesterday, and Plaintiffs are fine with what 19 the Court has said. 20 We would -- in light of the question, 21 however, would appreciate if the Court would 22 just make a statement to the Jury that -- about 23 why the Court has decided to -- that these dead 24 spaces need to be part of the record so that 25 the jurors don't hold either side responsible 8656 1 for that, particularly the Plaintiffs, as I 2 indicated before, since we have to rely more on 3 deposition testimony. 4 MR. TULCHIN: I don't think it's 5 necessary, Your Honor. There was a note from 6 one juror, not from 12, and it is what it is. 7 I don't think any juror will draw any 8 inference that someone is to be blamed if this 9 subject is not addressed. 10 THE COURT: All right. 11 MR. CASHMAN: Well, certainly, Your 12 Honor, there is no harm in giving that kind of 13 statement so that the jurors understand why 14 there are long pauses in the tape. 15 THE COURT: Anything else? 16 MR. TULCHIN: No, sir. 17 MR. CASHMAN: No, Your Honor. 18 THE COURT: I'll mention something in 19 passing that the long pauses are part of the 20 deposition record. 21 MR. CASHMAN: Thank you. 22 THE COURT: Not much I can do about 23 it. 24 MR. CASHMAN: Thank you, Your Honor. 25 THE COURT: I've ordered it that way. 8657 1 MR. TULCHIN: Your Honor, do I 2 understand that tomorrow we are going to break 3 at around lunchtime because -- 4 THE COURT: Yeah, I guess someone has 5 to go to a funeral. Is that okay? 6 MR. TULCHIN: Oh, yes, certainly. I 7 just wanted to make sure we knew the schedule. 8 Will we break at 11 or 12? 9 THE COURT: You know what, I don't 10 know what. I'll find out from Carrie. 11 MR. TULCHIN: Is it worth going 12 tomorrow until 12? Some of the jurors are in a 13 habit of having lunch at 11. 14 THE COURT: I think we are going to 15 11. I think the service starts at 12:00, but 16 let me ask Carrie what that lady said and we'll 17 figure out the time. 18 MR. TULCHIN: Sure. 19 THE COURT: Apparently, there is some 20 memorial service for her father-in-law. 21 MR. GREEN: Father-in-law, yeah. 22 THE COURT: All right. Well, you'll 23 get a three-minute break if you want it. Smoke 24 them if you got them outside. 25 I've got to make a quick record. I 8658 1 guess Ms. Carrie needs to make the record. 2 THE CLERK: I do. 3 THE COURT: Tell us what you were 4 told, Carrie. 5 THE CLERK: I was informed because of 6 what happened yesterday, the deputies are 7 wanting to walk them out to their car. 8 THE COURT: They want to know what 9 happened. 10 MR. CASHMAN: What happened? 11 THE COURT: I don't think you told 12 them. 13 THE CLERK: Yesterday one of the 14 jurors called in and left the message saying 15 that someone was in the parking lot taking 16 pictures of him. 17 MR. GREEN: Really? 18 THE CLERK: I haven't talked to him 19 yet this morning, but I was going to wait until 20 they all got here and a find out what happened. 21 THE COURT: I notified -- or Carrie 22 notified court administration. I also talked 23 to the assistant court administrator and I 24 talked to Carrie and I'm going to have an 25 deputy escort them outside from now on. 8659 1 MR. TULCHIN: Yeah, I think that's a 2 good idea, Your Honor. 3 Do we know whether it was a private 4 person or a member of the press? 5 THE COURT: She's going to get more 6 information. All we know is some guy in a 7 red -- 8 THE CLERK: Jacket. 9 THE COURT: Red jacket and hopefully 10 he can give identification marks to the sheriff 11 or something or to Carrie so she can pass on 12 who it is. 13 MR. GREEN: One juror, Carrie? 14 THE CLERK: One juror called in, but I 15 don't know if others saw or what exactly 16 happened. 17 THE COURT: She'll find out more, but 18 I'm going to have the deputy escort them now. 19 (A recess was taken from 8:27 a.m. 20 to 8:33 a.m.) 21 THE COURT: Did you talk to the 22 jurors? 23 THE CLERK: They told me there was 24 someone over by the Fourth Street -- Fourth 25 Street in the southeast corner with a long lens 8660 1 taking pictures. And one of them wasn't sure 2 if they were taking pictures of them, so she 3 drove by them and he snapped pictures as she 4 was going by. 5 THE COURT: Are you kidding? Did they 6 get a description? 7 THE CLERK: He was really far away. 8 They just saw him with a camera. 9 THE COURT: All right. Tell the 10 deputies that. 11 THE CLERK: So just in case, I'll try 12 to have a deputy ready right around 3:00, but 13 we need to leave a few minutes early because -- 14 like she said, she bolts out of the courthouse 15 to get to her kids on time. 16 MR. TULCHIN: I'm sorry, which one was 17 it? 18 THE COURT: Number 6. 19 MR. TULCHIN: [redacted]? 20 THE CLERK: Yeah, she has to pick her 21 kids up. 22 THE COURT: Is she the one who saw the 23 photographer? 24 THE CLERK: She, I -- no, it was 25 [redacted]. 8661 1 THE COURT: [redacted]? 2 THE CLERK: Is the one that drove past 3 to make sure he was snapping pictures of them, 4 but about four of them saw him taking pictures. 5 THE COURT: At break time, call a 6 deputy up here and I want to talk to him. I 7 -- I think we need to start an investigation. 8 THE CLERK: Sure. So are we ready for 9 the Jury this morning? 10 THE COURT: Are you guys ready? 11 (The following record was made in the 12 presence of the jury at 8:36 a.m.) 13 THE COURT: Everyone else may be 14 seated. 15 A few things. First, ladies and 16 gentlemen of the jury, I apologize for being 10 17 minutes late here. 18 One, there was a question about the 19 long pauses in the depo. That's part of my 20 doing. I wanted the record to come in just as 21 it is. So I apologize for that. 22 The other problem, I guess we had an 23 issue with someone taking photographs in the 24 parking lot. A deputy will escort you from now 25 on from the courthouse to your car. 8662 1 And I'm going to request that the 2 deputies do something as far as some type of 3 investigation to find out what's going on. 4 If you see something like that again, 5 please report it to Carrie and try to get a 6 description, if you can, so we can find out. 7 From now on, you'll be escorted by a 8 deputy out of the courthouse. 9 Okay. Also, the testimony of 10 Mr. Chestnut which you are hearing today, there 11 was a reference to a Plaintiffs' Exhibit 5166. 12 The exhibit is hearsay, will not be admitted 13 into evidence. You may not consider its 14 contents for the truth of what is stated in the 15 article. Portions of the article were shown to 16 you or will be shown to you to provide context 17 for Mr. Chestnut's testimony. 18 With that, you may start -- oh, we 19 need to get the lights. 20 MR. CASHMAN: Plaintiffs re-call 21 Mr. Mark Chestnut. 22 THE COURT: It's all ready to go. 23 (Whereupon, the following video was 24 played to the jury.) 25 Question: My question was focused 8663 1 only on what he was saying here, not what he 2 was not saying. And the paragraph that I read, 3 the statements that he makes there, aren't 4 those statements accurate as a matter of fact? 5 If you know. 6 Answer: I have no reason to think 7 that they're inaccurate. 8 Question: Okay. He goes on to state 9 in the next paragraph, beyond that, DR-DOS 5.0 10 leapfrogs MS-DOS 3.3 and 4.0 in some important 11 ways. 12 Do you agree or disagree with that 13 statement? 14 Answer: I disagree to the extent that 15 the problem with compatibility that I mentioned 16 before that you moved to strike basically 17 negates some of the benefit that it would have 18 otherwise offered. 19 I mean, the key feature the users 20 cared about was the ability to load DOS HI. If 21 in the process of loading it high you couldn't 22 run applications because they broke, in my mind 23 that negates it, and that certainly discounts 24 his claim that it leapfrogs the MS-DOS 25 releases. 8664 1 Question: So Ray Duncan just missed 2 the fact that there were problems with the 3 ability to load high and that that was somehow 4 a critical shortcoming of the DR-DOS product? 5 Answer: My -- I'm not basing this on 6 specific memory of what happened at the time, 7 but my interpretation based on reading this and 8 based on my recollection of what was happening 9 at the time was, we did some very rigorous 10 testing of DR-DOS 5.0. 11 We sent it out to an outside testing 12 lab. They beat the thing to death. 13 Ray was basically doing a product 14 review of the thing. I don't know that he 15 tested it with a wide suite of applications 16 with DOS loaded high. 17 You know, I have to believe -- as I 18 recall, Ray was very thorough and very 19 conscientious about what he wrote. I have to 20 believe that he was aware of that stuff he 21 would have written it. 22 The fact that he didn't write it leads 23 me to believe that he probably hadn't done 24 extensive enough testing to uncover some of the 25 incompatibilities that we found. 8665 1 Question: So the short answer to my 2 question, I think, is that he just missed this 3 problem, the ability to load high? 4 Answer: That would be my 5 interpretation. 6 Question: Okay. Now, this outside 7 testing laboratory that you just referred to, 8 that was -- the acronym I think is NSTL? 9 Answer: I don't know. 10 Question: You don't remember, okay. 11 You used the words, you know, beat the 12 thing to death. Was that your assignment to 13 NSTL was to really put it through the grinder? 14 Answer: I believe we asked the 15 outside testing lab, and I don't recall if it 16 was the company that you mentioned, it strikes 17 me that it was a different company, but we 18 asked them to thoroughly test it. 19 (Whereupon, playing of the video 20 adjourned.) 21 MR. GREEN: Your Honor, I think we're 22 done with the document. I don't know why it's 23 continued to be displayed. 24 MR. CASHMAN: Your Honor, maybe we 25 should have a sidebar. 8666 1 MR. GREEN: Well, I don't know if we 2 need a sidebar. 3 THE COURT: Is he moving on in his 4 testimony? 5 MR. CASHMAN: I think so. 6 THE COURT: Okay. Take it down there. 7 Continue. 8 (Whereupon, the following video was 9 played to the jury.) 10 Question: So the short answer to my 11 question, I think, is that you just missed this 12 problem, the ability to load it high? 13 Answer: That would be my 14 interpretation. 15 Question: Okay. Now, this outside 16 testing laboratory that you just referred to, 17 that was, the acronym I think is NSTL? 18 Answer: I don't know. 19 Question: You don't remember, okay. 20 You used the words, you know, beat the 21 thing to death. Was that your assignment to 22 NSTL, was to really put it through the grinder? 23 Answer: I believe we asked the 24 outside testing lab, and I don't recall if it 25 was the company that you mentioned, it strikes 8667 1 me that it was a different company, but we 2 asked them to thoroughly test it. 3 Question: And they found it to be 4 compatible with Windows 3.0, didn't they? 5 Answer: I believe so, yeah. 6 Question: Okay. Microsoft thereafter 7 did its own internal testing to confirm that 8 DR-DOS was somehow incompatible with Windows 9 3.0; isn't that correct? 10 Answer: I'm not sure about that. 11 Question: But if Microsoft had, in 12 fact, done its own internal testing and found 13 out that -- and by that testing come up with 14 incompatibilities with Windows 3.0, would you 15 expect that the incompatible information about 16 Windows 3.0 was communicated to your sales 17 force or the objective review that was done by 18 the outside testing lab on Windows 3.0? 19 Answer: I guess I don't understand 20 the question. Are you saying if Microsoft had 21 done testing and found results contrary to what 22 the testing lab had found, would they show 23 those results? 24 Question: Yes. 25 Answer: I would imagine so. 8668 1 Question: So you had compatibility 2 testing done by an outside lab; correct? 3 Answer: (Witness nodded head.) 4 Question: That outside lab found 5 Windows 3.0 to be compatible; correct? 6 Answer: I don't recall them making an 7 issue of it being incompatible with Windows 8 3.0. I don't specifically recall that they 9 said, hey, it really runs great with Windows 10 3.0. But I just don't recall. 11 I would have remembered if they'd 12 said, hey, it doesn't work at all with Windows 13 3.0. And I knew they didn't say that. 14 Question: And you don't recall if 15 Microsoft went on to do its own Windows 3.0 16 compatibility testing? 17 Answer: I don't. 18 Question: Let me hand you what's 19 previously been marked as Exhibit 816. This is 20 actually a series of e-mails. And please 21 familiarize yourself with it, but I first want 22 to direct you to the last page because I think 23 that's where the thread begins. 24 It's a message from -- it says 25 W-Maria, but I think that that's Marianne 8669 1 Allison's e-mail -- 2 Answer: Yes. 3 Question: -- name? 4 Answer: Yes. 5 Question: And it's to you, Brad 6 Silverberg and Russ Werner. 7 And it -- that message on October 8, 8 1990, states in full, what can we really say 9 about bona fide compatibility issues with 10 DR-DOS. I always hear vague stuff about this 11 that relates to MS products which makes us look 12 self-serving. 13 If we have a real user alert type 14 story to tell about DR-DOS compatibility 15 issues, PR should be all over it. I don't 16 think compatibility problems with a future, 17 unshipping Microsoft products is a very good 18 story. 19 Then the press could say, good, if 20 it's not shipping, you have time to fix it. 21 FUD about compatibility is our best weapon, but 22 we need real stuff. Any input? Marianne. 23 Did I read that correctly? 24 Answer: Uh-huh. 25 Question: Are you familiar with the 8670 1 term FUD? 2 Answer: Yes. 3 Question: Can you give me your 4 understanding of that term, what it means and 5 how it's used? 6 Answer: Sure. It's an industry-wide 7 term. I first became aware of it when I was at 8 HP selling computers in the early to mid-'80s. 9 It's fear, uncertainty and doubt. 10 It's the -- my understanding is it's 11 the practice of sharing information about -- 12 typically about competitors that would create 13 hesitancy in the buyer's mind before making a 14 decision. 15 Question: And are typically the 16 points that would create such hesitancy 17 concerns about compatibility? 18 Answer: In the case of this product, 19 yes, that's probably true. 20 Question: And so she is soliciting 21 from you and some others, you know, FUD points 22 to start getting out as a matter of PR; is that 23 correct? 24 Answer: She's asking are there other 25 more -- are there other, you know, examples of 8671 1 incompatibility that we can let people know 2 about. 3 Question: And you provided her with a 4 lengthy list, which if you go back to the first 5 page, the remainder of the thread is simply -- 6 and tell me if I'm incorrect, but that is your 7 response to Marianne Allison when she requested 8 FUD points, you passed along all of the 9 attached information on the next three pages; 10 correct? Next four pages. 11 Answer: It looks like my e-mail was 12 in response to Marianne's e-mail, yeah. 13 Question: She says in the last 14 paragraph, FUD about compatibility is our best 15 weapon but we need real stuff. 16 Do you agree with that statement? 17 Answer: I believe that the major 18 weakness of the DR-DOS product relative to our 19 product was compatibility. 20 Question: So you do agree with that 21 statement? 22 I didn't get a yes or no, so I just 23 wanted to clarify. 24 Answer: I don't know that I would 25 agree with the choice of words. I wouldn't 8672 1 have worded it that way if I were communicating 2 that. 3 FUD implies that there was some 4 nefarious intent that we're, you know, let's 5 spread lies about these guys. 6 I mean, FUD has a connotation of being 7 less than truthful. I never had any intent of 8 spreading information about DR-DOS that was not 9 truthful. 10 Question: Okay. If you'll go back up 11 to the first page, first paragraph. 12 This is what begins your reply to her 13 e-mail. 14 Attached is a summary of DR-DOS 5 15 compatibility issues. The compatibility 16 testing was done by an outside testing lab. I 17 have their formal write-up if you need it. The 18 Windows 3.0 compatibility testing was done 19 internally. 20 Did I read that correctly? 21 Answer: You did. 22 Question: And we have, I believe, 23 already gone over the fact that the outside 24 testing lab had confirmed that Windows 3.0 was 25 compatible with DR-DOS 5.0; correct? 8673 1 Answer: I believe that was the case. 2 I don't specifically remember. 3 I do know that they didn't come back 4 and say it was incompatible with 3.0, and 5 that's really all that I remember specifically. 6 Question: And so to your outside PR 7 person, when she's asking for compatibility 8 problems, you had in hand outside testing lab 9 results showing Windows 3.0 compatibility, and 10 yet Microsoft went on to do internal testing 11 and you passed along information about 12 incompatibilities? 13 Answer: No, no. 14 Question: Isn't that correct? 15 Answer: That's not correct. 16 I don't know specifically that they 17 tested it for Win 3.0 compatibility. I'm 18 looking at an e-mail that I wrote nine years or 19 eight years ago, and it says that the Windows 20 compatibility testing was done internally. 21 If you're asking did I specifically, 22 you know, ignore testing results by that 23 testing lab about Windows 3.0 compatibility so 24 that we could get better results out of our 25 internal group, no, that's absolutely not how I 8674 1 remember it. 2 Question: Okay. If Windows 3.0 was 3 found to be compatible by the outside testing 4 lab, you didn't pass that along to your PR 5 person, did you? 6 Answer: I don't have any memory of 7 what they tested relative to 3.0 or if they 8 tested it at all. 9 I specifically don't remember 10 willfully excluding 3.0 test results given to 11 me by the testing lab to the PR people. 12 Question: Okay. Just to make sure 13 that the statement here is accurate, the last 14 sentence of that paragraph says, the Windows 15 3.0 compatibility testing was done internally. 16 And if you go to the bottom of the 17 next page, it says, Windows 3.0 compatibility 18 issues, and then there is an entire page and a 19 little bit more about Windows 3.0 compatibility 20 problems. 21 And is that the testing and results 22 that was done internally? 23 Answer: Apparently. 24 Question: For a product like an 25 MS-DOS version, do you have an understanding of 8675 1 what the expected life cycle would be of the 2 product in terms of how long it would be out 3 there before the next version came along? 4 Answer: You know, very roughly, 12 5 months was probably the estimation at that 6 time. 7 Question: Do you have an 8 understanding that MS-DOS 3.0 was released in 9 or around August 1984? 10 Answer: Yeah. I believe 3.0 was 11 introduced when the IBM NT was introduced, 12 which is about that time period. 13 Question: And then MS-DOS 4.0, I 14 guess it was 4.01 you said, that was released 15 in November of 1988? 16 Answer: Well, understand that our 17 experience as a company in developing software 18 extended to products beyond MS-DOS. 19 Question: Oh, absolutely. I mean, 20 you have applications and others -- you had 21 Windows -- 22 Answer: Right, so the normal 23 expectation was a major time period between 24 releases -- between major releases should be 25 about 12 months. 8676 1 MS-DOS was always sort of an anomaly 2 because there was a period of time there. I 3 believe -- I want to say it was 1987 when there 4 was this big grand announcement with IBM and 5 the joint development agreement and OS/2 and 6 ya-da-ya-da. 7 Question: Is that the DOS is dead 8 announcement? 9 Answer: Basically the implied 10 understanding was that, yeah, MS-DOS was going 11 to be quickly supplanted by OS/2 and it was a 12 -- sort of a drying product. And that played 13 out otherwise and the market acceptance of OS/2 14 was not what people expected. 15 Question: And that was at the COMDEX 16 event in November of 1987 where this 17 announcement was made? 18 Answer: That sounds right. 19 Question: Okay. And Microsoft and 20 IBM, and I believe it was Bill Gates and Jim 21 Canovena? 22 Answer: Could be. 23 Question: On stage together. 24 But the perception in the industry was 25 that Microsoft and IBM had just announced that 8677 1 DOS is dead and would be supplanted by OS/2; 2 correct? 3 Answer: That is what most people 4 assumed. The question was how long would it 5 take for the version of OS/2 that was going to 6 be the killer OS to arrive and therefore 7 supplant MS-DOS. 8 Question: You said that DOS was kind 9 of an anomaly in terms of the 12-month span 10 between major versions which was typical at 11 Microsoft? 12 Answer: Well, only because IBM was 13 involved in the development -- 14 Question: Right. 15 Answer: -- and it wasn't just a 16 Microsoft product. 17 Question: So typically it was much 18 longer than 12 months between versions of 19 MS-DOS; correct? 20 Answer: Yeah. In the case 3.0 to 4.0 21 it was -- 22 Question: Four years? 23 Answer: Right. In the case of, you 24 know, 4.0 to 5.0 and 5.0 to 6.0 it was much 25 less than that. 8678 1 Question: Let me hand you what's 2 previously been marked as Exhibit 22, and this 3 is something you authored and is from November 4 3, 1989. The subject is MS-DOS upgrade 5 marketing plan; correct? 6 Answer: Correct. 7 Question: Do you recall this 8 document? 9 Answer: Yes. 10 Question: And this is addressed to -- 11 on the front page Bill Gates, who's CEO, Jon 12 Shirley, who is -- who was then the president, 13 and Steve Ballmer who basically is the number 14 two guy at Microsoft; correct? 15 Answer: Well, he was number three, I 16 guess, at one point. 17 Question: And point 2 says, establish 18 a retail presence for MS-DOS and reduce the 19 potential appeal of MS-DOS clone products in 20 the retail channel. 21 Answer: Uh-huh. 22 Question: And by that it means that 23 MS-DOS did not have any presence in the retail 24 channel at the time; correct? 25 Answer: As a shrink-wrapped product, 8679 1 no, it did not. 2 Question: And Microsoft was aware 3 that DOS clone products were trying to find 4 their way into the retail channel; correct? 5 Answer: I was aware of that, yes. 6 Question: And the product 7 specifically that you were aware of trying to 8 gain a foothold in this channel was DR-DOS; 9 correct? 10 Answer: Correct. 11 Question: And so because DR-DOS was 12 trying to move into the retail channel, 13 Microsoft decided to do what it had never done 14 previously, and that is develop an MS-DOS 15 product to go after the retail channel; 16 correct? 17 Answer: No, I would disagree very 18 strongly that statement. 19 It was certainly not because DR-DOS 20 was in that channel. DR-DOS was selling the 21 product at retail and really having no success. 22 Question: Were you worried that they 23 might begin encounters success? 24 Answer: Well, let me just finish what 25 I wanted to say in response to your first 8680 1 question, which is that it had nothing to do -- 2 our initial impetus to create a retail upgrade 3 of the product had nothing to do with DR-DOS 4 having a retail version of the product. 5 At the time that we -- that Steve 6 Ballmer really pushed for that, which is before 7 I was even on board as product manager, DR-DOS 8 hadn't even come to market. 9 Question: Okay. 10 Answer: So it was clearly not because 11 of DR-DOS that we wanted to do that. 12 Now, if you can your repeat your -- 13 Question: And if you'll turn to page 14 -- back to page 10. 15 On timing and availability, it talks 16 about some beta releases and then concludes 17 with, final release to manufacturing February 18 1, 1990. Ship date to distributors and directs 19 February 18, 1990. And did I read that 20 correctly? 21 Answer: Yes, you did, but I'm 22 surprised that I would have listed those dates 23 because the first beta release -- the date of 24 the document was November 3rd, and I know we 25 didn't have that beta release so I must have 8681 1 not captured it accurately. 2 Question: It says the first beta 3 release, October 6, 1989. 4 Answer: Yeah. It didn't happen. 5 Question: There was no beta release? 6 So that's just -- 7 Answer: Not that I can remember. 8 Question: So that's just inaccurate? 9 Answer: I must have just -- yeah. 10 Question: Okay. Is it inaccurate 11 that the plan was to have the final release in 12 manufacturing on February 1, 1990? 13 Answer: Well, I don't doubt that that 14 was the plan at one point in time, but I 15 suspect -- and I'm only basing this on my 16 interpretation of this document reading it, you 17 know, nine years after the fact. 18 Question: Right. 19 Answer: This document is dated 20 November 3rd. It shows a schedule where the 21 first beta release occurred a month prior to 22 that, and I know it didn't happen. 23 So I don't know if I screwed up and 24 put a earlier version of the schedule that was 25 clearly outdated by the time this document, you 8682 1 know, was published. I don't know if I screwed 2 up or what. 3 Question: So actually, then, all 4 these dates actually might be adjusted later so 5 that the beta releases would have been later 6 and thereby the release to manufacturing would 7 have been later. 8 Answer: Well, software schedules are 9 always somewhat of a moving target until the 10 product gets a little more firm up. But I 11 believe that in this particular case all I'm 12 saying is I think I screwed up and put an 13 obsolete schedule in this document. 14 Question: Was this product in any way 15 firmed up at this time, based on your review of 16 this marketing plan? 17 Answer: The 4.1 product that IBM was 18 developing was -- I mean, there was a 19 specification and, you know, I believe that 20 they, you know, had working code. I don't 21 believe it was ready for a beta release or 22 something like that. 23 Question: So there was not even -- 24 there was not a 4.1 beta out, to your 25 knowledge, at this time? 8683 1 Answer: Oh, there certainly wasn't, 2 no. 3 Question: Was there ever? 4 Answer: No. It was shortly after 5 this that we made the decision, I believe, to 6 bring development in-house and focus on a DOS 5 7 release. 8 Question: To get back to where we 9 were, as of November 1989, Microsoft's internal 10 plan, which is reflected in this document that 11 you wrote, was to have a final release to 12 manufacturing in February 1990 of a upgrade 13 product for 4.1; correct? 14 Answer: As reflected in this 15 document, yeah. 16 Question: And if Microsoft was going 17 to be releasing a 4.1 upgrade product in 18 February of 1990, what is your understanding of 19 the likelihood of releasing a 5.0 product also 20 in 1990? 21 Answer: As I said, I didn't have any 22 expectation that we would have a 5.0 product 23 shipping in '90 after shipping a 4.1 product in 24 '90, at that point. 25 Question: If you'll go to page 2 of 8684 1 the document, there's a little chart that shows 2 percent and total units of the DOS installed 3 base. 4 Answer: Uh-huh. 5 Question: And, you know, my simple 6 addition of this indicates that the DOS 3.X 7 versions in total added up to 90 percent of the 8 installed base and at this point DOS 4.0X had 9 only achieved 1 percent of the installed base; 10 is that correct? 11 Answer: Yeah. It's correct as far as 12 your interpretation of the data. 13 Question: Okay. Am I missing 14 something? 15 Answer: Well, the thing that's a bit 16 misleading is that MS-DOS 4.0 didn't start 17 shipping from OEMs to end users until about 18 January of '89. 19 Question: Okay. 20 Answer: And OEMs reported royalties a 21 quarter in arrears, so there was not a lot of 22 numbers yet from royalty reports on DOS 4.0 23 shipments to customers. 24 Question: There had been enough time, 25 though, to get feedback that MS-DOS 4.01 was a 8685 1 buggy product; correct? 2 Answer: There were reports of 3 incompatibilities, as we mentioned before, in 4 the Norton Utilities. 5 Question: But you would yourself 6 characterize the market perception was that 7 MS-DOS 4.01 was a buggy product? 8 Answer: There was a perception that 9 it was a buggy product. 10 Question: The fact that Microsoft had 11 a shipping product that had a perception that 12 it was buggy out there meant that Microsoft 13 knew it was going to have to really spend some 14 time and get out a rock solid product on the 15 next version; right? 16 Answer: True. 17 Question: As far as competition in 18 the DOS market when you were product manager of 19 MS-DOS, did you consider DRI to be your major 20 competitor worldwide? 21 Answer: Yes. 22 Question: Yeah, while you were 23 product manager, and specifically let's just 24 limit it to your perception at the beginning of 25 1990. 8686 1 Answer: The other competitors that I 2 was aware of at that time, there was a company 3 called Data Light that had a product called ROM 4 DOS. There was a company out of the UK called 5 DIP. 6 Question: Would you agree that MS-DOS 7 had a monopoly as far as sales to OEMs? 8 Answer: We certainly had a 9 significant market share. I'm not -- 10 Question: Did you have a greater than 11 90 percent market share? 12 Answer: I believe so. 13 Question: Okay. When did you first 14 become aware of DR-DOS 5.0? 15 Answer: About the time it was 16 released. 17 Question: Let me hand you an exhibit 18 that is marked Exhibit 25. 19 And just to note for the record, I 20 think that this got also marked as Exhibit 821, 21 different Bates numbers, but I believe that 22 they're substantially identical, apart from 23 Bates numbering. 24 And this is a document that you wrote 25 in May -- on May 2, 1990, and the subject is 8687 1 DR-DOS 5.0 competitive analysis; correct? 2 Answer: Correct. 3 Question: And do you recall this 4 document? 5 Answer: I do. 6 Question: Turning to the first page 7 of text, begins with marketing overview. 8 It states, DRI announced the next 9 version of DR-DOS version 5.0 on 4/26 in the UK 10 for mid-June 1990 delivery to OEMs. 11 And is that an accurate statement of 12 what DRI had, in fact, announced on April 26? 13 Answer: I believe so. 14 Question: And then you make the 15 comment, this is a very significant release. 16 And that was your perception of what 17 you had heard about DR-DOS version 5.0; 18 correct? 19 Answer: That was my perception based 20 on what I knew at that time, yeah. 21 Question: You go on to say, it 22 addresses many of the compatibility problems 23 that plagued earlier DR-DOS releases while also 24 introducing several important new features. 25 How did you know that version 5.0 8688 1 addressed those compatibility problems? Was it 2 just based on what was said at the 3 announcement? 4 Answer: Well, at this point, 5 everything I knew about DR-DOS 5 came from what 6 DRI was saying publicly about the product. 7 I didn't have access to the product 8 and I was taking basically what they were -- 9 and I think I qualified that at some point in 10 this document basically saying, you know, if 11 what they're saying is true. 12 But my analysis of the features of the 13 product and the compatibility issue was based 14 on what DRI themselves were saying publicly, 15 which we hadn't yet gotten through to test the 16 product, et cetera. 17 Question: The last sentence of that 18 paragraph says that, they -- by that I think 19 you're referring to DR -- are telling OEMs that 20 Microsoft has no ongoing commitment to MS-DOS 21 and are hoping to get some quick OEM design 22 wins before MS-DOS 5.0 becomes generally 23 available. 24 That's your perception at the time of 25 what DRI was saying? 8689 1 Answer: Uh-huh. 2 Question: If DRI was telling people 3 that Microsoft had no ongoing commitment to 4 MS-DOS, do you agree or disagree with that 5 statement? 6 Answer: I strongly disagree. My 7 point was they were spreading misinformation 8 about our commitment to MS-DOS. In fact, we 9 were increasing staff for MS-DOS. 10 Question: But at least as far as 11 through 1988 and 1989, following the November 12 1987 COMDEX event, Microsoft and IBM had 13 announced that DOS is dead and things were 14 going to be moving to OS/2; correct? 15 Answer: I don't believe it was ever 16 announced that DOS was dead. It may have been 17 interpreted that way by people, but there was 18 no official announcement, DOS is hereby dead. 19 Question: But you described that DRI 20 was out there spreading misinformation, and I 21 just wanted to correct or clarify that I 22 believe that I had your understanding that the 23 general perception was that Microsoft was 24 moving to the development of OS/2 and wanted 25 that to be the next operating system. 8690 1 Are you going back on the testimony 2 from earlier? 3 Answer: No, I'm not. 4 There was a point in time where a lot 5 of people assumed, including many of us at 6 Microsoft, that DOS was basically going to be 7 quickly supplanted by OS/2. 8 It became clear, the initial releases 9 of OS/2, which I believe occurred in the '88 10 and '89 time frame, were not exactly stellar. 11 I think that certainly the Microsoft perception 12 changed, and you can even read some of the 13 articles that I've seen in some of these 14 exhibits, editorials -- you know, editorial 15 observers were noting that, hey, DOS isn't 16 really dead after all, that sort of thing. 17 But my point was in this time frame, 18 MS-DOS was something that we were investing in. 19 There was a period of time where earlier, prior 20 to that, that it was sort of dead. 21 But at this point in time we were 22 investing in it, we had a major new release 23 under development, and DRI was continuing to 24 tell people, oh, hey, these guys aren't doing 25 anything in terms of DOS or not investing their 8691 1 -- they have nobody working on it, and it 2 wasn't true. 3 Question: Well, the first paragraph 4 of this comparison section says, assuming that 5 all of DRI's claims about DR-DOS 5.0 are true, 6 it appears that the two release are fairly 7 comparable, but, on balance, MS-DOS 5.0 is a 8 little stronger. 9 There's a footnote to this statement 10 and it says down at the bottom, this was the 11 opinion of two U.S. OEMs who had been briefed 12 both by Microsoft and DRI, AST and Tandon. 13 Did you do those briefings? 14 Answer: I was certainly -- yeah, I 15 was certainly present at both meetings. I 16 don't -- there may have been other people 17 involved. I'm not sure. 18 Question: Do you recall -- so this 19 was a briefing about MS-DOS 5.0? 20 Answer: Yes. 21 Question: Do you recall what you told 22 them? 23 Answer: I described the basic feature 24 set that we had outlined in the specification 25 and asked for their reaction and feedback. 8692 1 Question: Did you tell them when it 2 would be available for shipment? 3 Answer: Our plan at that point in 4 time was to have it shipping in I believe it 5 was September time frame. 6 Question: September 1990? 7 Answer: Yes. 8 Question: And this is May 1990? 9 Answer: Yes. 10 Question: And you haven't even 11 released your first beta; is that correct? 12 Answer: We were planning to release 13 beta in June, but, yes, you're right, we hadn't 14 released beta yet. 15 Question: Is it your opinion that a 16 rock solid MS-DOS 5.0 product could be 17 developed from June 1990 when the first beta 18 went out to September 1990 when you were 19 promising that it would be shipping to OEMs? 20 Answer: Answering the question now 21 based on what I know now, I don't think that 22 it's realistic that we could have done that. 23 At the time we believed that because 24 we had developed the code. It wasn't the stuff 25 that IBM had developed that it was -- we were 8693 1 starting with good code. We could get away 2 with a short beta period and have a good 3 product. That was our belief at the time. 4 Question: So you acknowledged that 5 you were anticipating a short beta period to 6 come out with the MS-DOS 5.0 product? 7 Answer: We were planning a relatively 8 short beta period. 9 Question: And even though you knew 10 you were having to overcome the buggy 11 perception of MS-DOS 4.01, that's your 12 testimony? 13 Answer: It is. We thought we had the 14 capability to do that. 15 Question: And you do acknowledge that 16 you told -- do you recall when your briefings 17 were at AST and Tandon? 18 Answer: I don't. 19 Question: You do acknowledge that you 20 told both of them there would be a shipping 21 product by September of 1990? 22 Answer: I don't specifically recall 23 what I told them as far as schedules, but in 24 general I believe we were telling people in 25 that approximate time frame that we expected 8694 1 the product to be available in September of 2 1990. 3 Question: When you met with AST and 4 Tandon, did you press them for details about 5 DR-DOS 5.0? 6 Answer: I recall -- I don't recall 7 discussing it with AST. I do recall discussing 8 in general terms with some of the Tandon 9 people, you know, what their opinion was of 10 what we were -- you know, the MS-DOS 5.0 11 product relative to the DR-DOS product. 12 Question: You met with Tandon the day 13 after DRI announced DR-DOS on April 26th; 14 correct? 15 Answer: Could be. I don't recall 16 specifically. 17 Question: Well, let's make sure. 18 I'll hand you what's marked as Exhibit 19 261. And it says this is a Tandon meeting 20 report from April 30, 1990. It's sent to you 21 and Jeff Lum, Richard Fade and Tom Lennon 22 prepared by Karen Hurlbut. 23 Summary section at the beginning says, 24 Mark Chestnut and I visited Tandon headquarters 25 in Moonpark, California on April 27, 1990. 8695 1 That is the day after the UK 2 announcement of DR-DOS; correct? 3 Answer: I believe so, yeah. 4 Question: And it says at the 5 beginning of the next paragraph, Mark Chestnut 6 gave a complete DOS 5.0 presentation including 7 ROM DOS plans. 8 That's an accurate statement; correct? 9 Answer: I believe so. 10 Question: What does a complete DR-DOS 11 5.0 presentation include? What does it mean? 12 Answer: I don't know what Karen 13 thought it included. It did not include a 14 demonstration of the product. I'm sure I had 15 some PowerPoints and talked about the features 16 of the product and -- 17 Question: So you put up transparency 18 slides for them to look at? 19 Answer: I believe so, yeah. 20 Question: And you talked about 21 specific features? 22 Answer: I'm sure I did, yeah. 23 Question: Was Tandon considering DRI 24 at the time? 25 Answer: It's hard to say. In some 8696 1 cases, OEMs would bring up DRI just in the 2 course of negotiation. 3 It's like, well, gee, maybe if you 4 won't give me the royalty I want, I'll just do 5 this DR-DOS thing. 6 I mean, it was hard to discern in some 7 cases how real -- you know, how seriously they 8 were considering DR-DOS. 9 Question: You had a perception that 10 OEMs -- 11 Answer: They certainly -- 12 Question: -- at least were saying 13 that, that they were considering it. 14 Answer: Some OEMs, yeah, were -- I 15 mean, I believe they represented that they were 16 considering it or looking at it or something 17 like that. 18 Question: How about Tandon in 19 specific? Do you have a recall? 20 Answer: Yeah, I was referring to 21 Tandon actually. I'm not sure -- 22 Question: Tandon had at least said 23 that they were considering DR-DOS -- 24 Answer: Right, but I wasn't sure if 25 it was just sort of a negotiation ploy or how 8697 1 seriously they were considering it. 2 Question: And other OEMs had 3 communicated that to you, whether or not you 4 thought it was a ploy or legitimate? 5 Answer: There were other OEMs that 6 were either considerating it or were using it 7 as a bargaining chip, you know, trying to get a 8 better deal out of us for MS-DOS or something. 9 Question: Towards the end of that 10 second paragraph it says, overall, Tandon was 11 impressed with our DOS 5.0 plans and feel that 12 based upon our schedule they can deliver the 13 product in the calendar Q4, Q1 time frame. 14 And would that -- would that 15 correspond with you telling them that it would 16 be released to them in September 1990? 17 Answer: Yeah, it would seem to. 18 Question: The next paragraph goes on 19 to say, we dismissed the engineering and 20 support people and discussed DRI. 21 Do you remember why you dismissed the 22 engineering and support people? 23 Answer: I didn't dismiss them. I 24 don't know why they were dismissed. 25 Question: Do you remember who was 8698 1 left at the meeting? And it refers to Peter 2 and Eric. Do you know who they they are? 3 Answer: I remember Peter. I guess I 4 remember Eric. I'm sure they were involved. 5 They were sort of the two principal guys. 6 Question: Gotcha, okay. 7 So you stayed in with the director of 8 OEM products and the director of engineering, 9 okay. Correct? I mean, based on -- 10 Answer: Yes, I believe that's 11 correct. 12 Question: -- what it says up there? 13 And then it indicates that they were 14 hesitant to divulge any competitive information 15 about DRI; is that correct? 16 Answer: I don't recall. 17 Question: It goes on to say, but 18 after asking a few round-about questions, we 19 were able to find out that DRI has been very 20 aggressive in trying to sell Tandon DRI DOS and 21 had been there recently with a full 22 presentation and demonstration. 23 Is that correct? 24 Answer: It's correct that that's what 25 it says. 8699 1 Question: That you learned that? Do 2 you recall learning that? 3 Answer: I don't recall learning that. 4 I just don't recall. 5 Question: Do you have any reason to 6 believe that that's not so? 7 Answer: No. 8 Question: It goes on to list -- it 9 goes on to state that, Peter and Eric assured 10 us that our DOS 5.0 product was as good as 11 DRI's current version, but, according to Peter, 12 we still had some work to do in the following 13 areas in order to be competitive. And then it 14 lists a few areas; correct? 15 Answer: Uh-huh. 16 I'm sorry. Yes. 17 Question: And this is the information 18 that you're just summarizing in the one-line 19 footnote that we were looking at back on 20 Exhibit 25; correct? 21 Answer: Well, you know, my 22 interpretation of this meeting and the meeting 23 with AST is not necessarily going to match how 24 Karen would write up a meeting report as the 25 account manager. 8700 1 My take-away from those meetings was 2 that we had a product that competed very well. 3 There was a couple of nice features that DR-DOS 4 had that we should look at it. 5 Question: What features in response 6 to DR-DOS 5.0 were added after May 2, 1990? 7 Answer: In response to DR-DOS, my 8 recollection is that we added the file transfer 9 utility and the ability to load device drivers 10 in high memory. 11 Question: And even though features 12 were going to be added after May 1990 in 13 response to DR-DOS 5.0, is it still your 14 testimony that you believed Microsoft was going 15 to be able to do a short beta test and have 16 this product out by September 1990? 17 Answer: We believed that, yes. 18 Question: What was the basis of that 19 belief? 20 First of all, you say that we believed 21 that. Who believed that? 22 Answer: The product team; Tom Lennon, 23 myself, Mike Dryfoos, Russ Werner. 24 Question: What was the basis for that 25 belief? 8701 1 Answer: The basis for that belief was 2 that we had developed it ourselves. We knew it 3 was a solid code base, that there may have been 4 an arrogance factor there. We believed -- or 5 our development guys believed that they were a 6 lot better than IBM's development team. We 7 believed that most of the things that we were 8 introducing were not of such a magnitude of 9 rearchitecting the product that it should 10 require elaborate, extensive beta test periods. 11 We thought we could do a reasonable 12 beta cycle in a period of about three months. 13 Question: I believe that you've 14 testified that you believed a short beta test 15 cycle could be done and the product would ship 16 by September 1990; correct? 17 Answer: We believed that a 18 three-month beta cycle would be sufficient to 19 test the product and have a solid product to 20 ship in September of 1990, yes, that is 21 absolutely true. 22 Question: And as far as MS-DOS goes, 23 you certainly didn't have any knowledge or 24 basis to make an assessment of how long a beta 25 test cycle was going to be; correct? 8702 1 Answer: I personally had no 2 experience with that, that's true. 3 Question: When did MS-DOS 5.0 4 actually release to manufacturing? 5 Answer: I'm not positive, but -- 6 well, I know that it was publicly announced in 7 June of -- I think June of '91. When it 8 released to manufacturing, I'm not sure. 9 Question: So 13 months after this 10 memo was written is when MS-DOS 5.0 actually 11 hit the market; correct? 12 Answer: When it was publicly 13 announced, yeah, I believe it was released to 14 manufacturing a few weeks prior to announcement 15 because I believe we had product in the retail 16 channel when we announced. And there was a 17 period of a few weeks prior to the announced 18 date when it was released to manufacturing. So 19 it would be on the order of 12 months, I would 20 imagine. 21 Question: The beta test cycle 22 actually took -- the beta test cycle and then 23 the release to manufacturing, in fact, took 13 24 months after this memo; correct? 25 Answer: I think it was more like 12 8703 1 months but -- 2 Question: Twelve months, okay. 3 Going to the -- it's the page that 4 starts competitive response to DR-DOS 5.0. 5 We're, again, looking at Exhibit 25, Bates 6 number X 566373. 7 No, a few more pages. Yeah, that. 8 The first paragraph says, on the PR 9 side, we have begun an aggressive leak campaign 10 for MS-DOS 5.0. What is -- what do you mean by 11 an aggressive leak campaign? 12 Answer: What I meant was we weren't 13 officially announcing the product to editors, 14 but we were going to tell them about the 15 product, our plans for the product. You know, 16 give them some information about schedule and 17 what features it would include. 18 Question: And you gave them a 19 schedule? 20 Answer: I don't think we handed over 21 the schedule, but I think we talked about 22 release dates. 23 Question: And you told them -- 24 Answer: I don't remember exactly what 25 we told them. I think -- I think we told them 8704 1 by the end of 1990, but I don't specifically 2 recall. 3 Question: To use the word aggressive 4 leak, what do you mean by aggressive? You're 5 actually going out to the editors and telling 6 them this? 7 Answer: Well, as I mentioned earlier, 8 part of the terminology and tone that I use is 9 to in some sense promote myself that, look, I'm 10 doing something proactive here. Aggressive -- 11 it means that we were calling them, basically. 12 It doesn't mean that we were breathing fire on 13 them. 14 Question: No, but you were calling 15 them to tell them about Microsoft's plans for 16 version 5.0? 17 Answer: As I recall, we did a few 18 phone interviews, told them a little bit about 19 the product and consulted some of the articles 20 that you see attached here. 21 Question: And that's what you did? I 22 mean, as this states, that's what you did as a 23 competitive response to DR-DOS 5.0; correct? 24 Answer: In part. I mean, the context 25 of this document is were we getting a better 8705 1 response to DR-DOS 5.0. The reason for going 2 to the press was broader than just responding 3 to DR-DOS 5.0. 4 Question: What were the goals? 5 Answer: Well, specifically we had 6 just come off the experience of introducing 7 Windows 3.0 without saying much of anything to 8 the press prior to its public announcement. 9 And we had some feedback from the 10 press that, gee, they'd sure like to get a 11 little bit more of a heads-up on future major 12 releases of products like this. 13 And part of it was an attempt to build 14 stronger relationships with editorial contacts 15 to give them more information sooner about 16 MS-DOS 5.0. 17 Question: And you also wanted to 18 diffuse any momentum that DR-DOS was going to 19 be getting with its version 5.0; correct? 20 Answer: That was certainly part of 21 the reason for doing that. 22 Question: The second sentence says, 23 the goal is to build anticipation for MS-DOS 24 5.0, and diffuse potential excitement/momentum 25 from the DR-DOS 5.0 announcement. Correct? 8706 1 Answer: Correct. 2 Question: So calling the editors and 3 giving them information about 5.0 was done to 4 rob DR-DOS of momentum that it was going to get 5 by announcing its 5.0 product; correct? 6 Answer: And to build anticipation for 7 MS-DOS 5.0. 8 Question: Okay. Which means you 9 wanted people to wait for MS-DOS 5.0; correct? 10 Answer: Sure. 11 Question: Okay. So you give this 12 information to the editors with the expectation 13 that on the one hand it's going to diffuse 14 excitement about DR-DOS 5.0 and on the other 15 hand cause people to wait for MS-DOS 5.0? 16 Answer: To start creating awareness 17 that there is going to be an MS-DOS 5.0 and 18 that it will have these features, and yes. 19 Question: And it says, at this point, 20 we are telling the press that a major new 21 release from Microsoft is coming this year 22 which will provide significant memory relief 23 and other important features. And were you 24 involved in telling the press that directly? 25 Answer: I recall having some 8707 1 interviews with press people. I think Russ 2 actually did more of the interviews than I did. 3 Question: And there are attached 4 articles that you refer to from PC Week, 5 Computer World and InfoWorld that you believed 6 to have been written in response to the 7 aggressive leak campaign; correct? 8 Answer: Correct. 9 Question: It then says, the last 10 paragraph, in addition to all of the above, we 11 have for the past several weeks been 12 implementing a competitive response plan, which 13 was put into effect when we first learned of 14 DRI's plans for this new release. 15 The purpose of the plan was to get the 16 MS-DOS 5.0 message out quickly to OEMs 17 worldwide, and to resellers in the U.S., is 18 that a correct statement of fact, what was in 19 fact occurring since the DRI announcement? 20 Answer: I believe so. 21 Question: And you were responsible 22 personally for a lot of the communication of 23 the messages to OEMs? 24 Answer: Yes, that's true. 25 Question: For instance, one of them 8708 1 was Tandon and we've already seen that; 2 correct? 3 Answer: Correct. 4 Question: That trip report, on the 5 next page there's a feature comparison. At the 6 bottom it says OEM availability. Late August 7 1990? For MS-DOS 5.0. 8 Answer: Right. 9 Question: Is that what you were 10 communicating to OEMs, when it was going to be 11 available? 12 Answer: I don't know if I 13 communicated that to OEMs specifically. I 14 don't know if I was promising a late August '90 15 date. I don't recall. 16 Question: Would you have -- I mean, 17 perhaps that's September 1990? 18 Answer: I recall telling people 19 September 1990. I don't recall telling OEMs 20 August 1990. 21 Question: On the next page it says 22 DR-DOS competitive response plan, and that's 23 what was -- what you referred to a couple of 24 pages ago. 25 I just want to go through a couple of 8709 1 the things and make sure that this accurately 2 reflects everything that had been done or was 3 to be done. 4 And it says, in the -- under OEM for 5 the U.S., it says, direct calls to vulnerable 6 OEMs, done. That's correct, vulnerable OEMs 7 had been contacted? 8 Answer: I believe so. 9 Question: Had you contacted any of 10 them? 11 Answer: Yeah. 12 Question: Did that include AST and 13 Tandon? 14 Answer: I'm sure it did, yeah. 15 Question: Who else did it include? 16 Answer: I don't recall others 17 specifically. 18 Question: But there were others? 19 Answer: There may have been others. 20 I don't recall. 21 Question: DR-DOS backgrounder to OEM 22 sales. That has a status of May 4? 23 Answer: Uh-huh. 24 Question: What was the backgrounder 25 going to be? 8710 1 Answer: I believe it was some of this 2 information, the table of features comparison 3 and so forth. 4 Question: And was that to be -- was 5 that, in fact, given to OEM sales? 6 Answer: I believe it was, yeah. 7 Question: And was it expected that 8 that material would be used by sales directly 9 with representatives of OEMs to say, here's 10 what's coming in MS-DOS 5.0 and here's how it 11 compares to DR-DOS 5? 12 Answer: It was meant to be a sales 13 tool to be used by account managers at their 14 discretion as they saw fit. 15 Question: And then they could use it 16 that way and disclose that information; 17 correct? 18 Answer: Sure. 19 Question: Did that include shipment 20 date of September 1990? 21 Answer: I don't -- I don't know if 22 what we distributed to OEM sales included 23 September 1990. I wouldn't be surprised if it 24 did. 25 Question: It also says, DOS 5 8711 1 presentation with script to OEM sales, done. 2 Does that mean that they were given 3 PowerPoint slides and speaking points for them? 4 Answer: Yeah, I'm sure that's what it 5 meant. 6 Question: And it would be like the 7 PowerPoint slides that you're referring to when 8 you were talking about the Tandon presentation? 9 Answer: Right. 10 Question: Would have features and it 11 would also have a potential shipping date? 12 Answer: I believe so, yeah. 13 Question: Then for the Far East and 14 ICON, what does ICON stand for? 15 Answer: ICON was basically -- I think 16 it was intercontinental or something. It was 17 basically Africa, Middle East. 18 Question: It says, the first thing, 19 Markche, C-H-E. That's Mark Chestnut, correct, 20 that's you? 21 Answer: Correct. 22 Question: Mark Chestnut DOS 5 23 presentations to NEC, Toshiba, Epson, Acer, 24 done. Is that correct, you had already done 25 those? 8712 1 Answer: Apparently, yeah. 2 Question: Where are they located? 3 Are they in the U.S. or did you fly to the Far 4 East already and do these briefings? 5 Answer: I didn't travel to -- these 6 are all Japanese OEMs. 7 Question: Those are all Japanese? 8 Answer: And I didn't travel to Japan 9 in that time frame so they must have been in 10 Redmond. Those companies frequently came to 11 Redmond. 12 Question: And it says next, Mark 13 Chestnut training session for MS Taiwan OEM 14 sales force, done. Had the MS Taiwan OEM sales 15 force traveled to Redmond to get a training 16 session from you? 17 Answer: Well, I'm trying to remember 18 if that was during the period of time before we 19 had the subsidiary in Taiwan or if we were 20 covering it out of Redmond. 21 But at that point I hadn't traveled to 22 -- I went to Taiwan I think in June so it must 23 have been at Redmond, wherever it was -- 24 Question: So they were brought to 25 Redmond and were given a presentation? 8713 1 Answer: Or maybe they were there for 2 some other purpose and I had a session with 3 them while they were there or something, I 4 forget. 5 Question: It also indicates that the 6 DR-DOS backgrounder is going to go to OEM sales 7 on May 4. And then it says, DOS 5 presentation 8 with script to OEM sales, that's already done. 9 And then Ron H., that's Ron Hosogi? 10 Answer: Correct. 11 Question: Presentation at Far East 12 OEM sales meetings, that's done. What was 13 that? 14 Answer: I think I gave him a set of 15 PowerPoints and said, Ron, I don't want to make 16 the trip. Why don't you make the presentation 17 and get these guys fired up. 18 Question: And who was that to, was 19 that Microsoft salespeople? 20 Answer: Yes. 21 Question: That's not to OEMs 22 directly? 23 Answer: No. Ron was responsible for 24 Far East OEM sales organization at that time. 25 Question: And then it indicates that 8714 1 a schedule was being set for meetings with 2 Taiwan and Korean OEMs for the Computex show in 3 June? 4 Answer: Correct. 5 Question: And that's just what you 6 referred to, you traveled to do that show -- 7 Answer: That's correct. 8 Question: -- in June of 1990? 9 Answer: Yes. 10 Question: Do you recall which Taiwan 11 and Korean OEMs you met with? 12 Answer: I recall meeting with Acer, I 13 recall meeting with -- in Korea I recall 14 meeting with Goldstar, Hyundai and what was the 15 other one? 16 Question: Daewoo, Samsung? 17 Answer: Samsung. I didn't meet with 18 Trigem. I believe I met with just Samsung, 19 Daewoo, and Hyundai. In Taiwan I met I think 20 with several OEMs, but I specifically remember 21 Acer. 22 Question: And then in Europe it 23 indicates that the DR-DOS backgrounder is going 24 to go out to OEM sales and the DOS 5 25 presentation with script to OEM sales is done. 8715 1 And it indicates that you are going to be in 2 Paris on May 9 to give a presentation to MS 3 Europe OEM sales? 4 Answer: Correct. 5 Question: And were you? 6 Answer: Yes, I was. 7 Question: And you gave that 8 presentation? 9 Answer: I did. 10 Question: And then it says Mark 11 Chestnut to visit European OEMs May 7 to May 12 16; correct? 13 Answer: Correct. 14 Question: And did you visit European 15 OEMs? 16 Answer: I did. 17 Question: Do you recall which ones? 18 Answer: I visited Olivetti, Siemens, 19 I met with a company called Sion in the UK. I 20 met with a company called DIP in the UK. I met 21 with -- who were the French OEMs? Oh, gosh, 22 what was it? 23 Question: You met with some French 24 OEMs? 25 Answer: Alcatel -- Alcatel, is that 8716 1 who it was? 2 Question: What countries did you 3 visit, OEMs? 4 Answer: Germany, France, UK -- 5 Germany, Franc