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The Trial Testimony of Greg Jones, Day 2, SCO v. Novell - updated
Wednesday, June 25 2008 @ 06:45 AM EDT

Here is the testimony of the final witness Novell called in the SCO v. Novell trial, Greg Jones, Vice President of Technology Law at Novell. He followed Darl McBride to the stand. His testimony came on day 2 of the trial.

It's primarily because of what I learned from this testimony that I took a long time to write an analysis of the trial. I was, frankly, too angry to trust myself to write about it until I had some time to cool off some.

We learn two primary things from Jones' testimony: first, what a cynical role Sun played in the SCO saga, and second, that all the time SCO was calling on the world, the courts, the Congress -- nay heaven itself, if I may say so -- to sympathize with it over the ruination of its Most Holy Intellectual Property by it being improperly open sourced into Linux, not that it turned out to be true, it had already secretly given Sun the right to open source it in OpenSolaris. Remember all that falderol about SCO being contractually unable to show us the code, much as it so desired to do so, because of being bound to confidentiality requirements? What a farce. SCO had already secretly given Sun the right to open source Solaris, with all the UNIX System V you can eat right in there.

The simple fact is, I gather from Jones' testimony, Sun could have prevented the harm SCO sought to cause by simply telling us what rights it had negotiated and received from SCO prior to SCO launching its assault on Linux. Yet it remained silent. When I consider all folks were put through, all the unnecessary litigation, and all the fear and the threats and the harmful smears, including of me at the hands of SCO and all the dark little helper dwarves in SCO's workshop, I feel an intense indignation like a tsunami toward Sun for remaining silent.

Just before Jones is called to the stand, McBride has testified that he first approached Jones in 2002 about getting the copyrights "clarified" as belonging to SCO, and according to McBride, Jones was willing to help him. Here's what McBride testified:

Q. Can you tell me when the first conversations occurred?

A. Yes. It would have been in the fall of 2002, probably early November.

Q. Who initiated the conversation?

A. I first called in to Greg Jones, who was an attorney at Novell.

Q. Okay. And what did you tell him or ask him?

A. Well, I told him that I was the CEO of SCO, SCO had acquired the UNIX properties, as we remembered from the '95 time frame, and we were preparing to enforce our intellectual property rights and, in the process of going through the related agreements, I had come across a head-scratcher, if you will, something in the agreements that did not make sense to me. There was competing language, where the majority of the Asset Purchase Agreement seemed to appear that all of the property went to the Santa Cruz operation, and there was really just one word in one small section that was conflicting that, and that was relating to the copyrights in the excluded asset list. And I explained that to Mr. Jones and, at the same time, explained to him what we were trying to do with our SCOsource program.

Q. Now, at the time you had this conversation, were you aware of amendment number 2?

A. No, I was not.

Q. What did you ask Mr. Jones for Novell to do?

A. I asked him if he would help us find all of the documents that related to the Asset Purchase Agreement in 1995, so we could try and get some clarity to what was clearly an erroneous problem. Something was in error because there was conflicting statements.

Q. What did Mr. Jones say to you?

A. He agreed with me and said he would do his best to see how he could help.

Q. Okay. Was there a follow-up conversation with Mr. Jones or anyone else from Novell?

A. Yes. Over the period of the next, I would say, two to three months, there were a number of discussions I had with Greg. And then, eventually, there was someone else from Novell, a Dave Wright came in, and I had some discussions with him, but primarily it was with Mr. Jones.

Q. Can you relate the substance of that conversation -- conversations?

A. The substance, if you put a thread through it, was basically us asking them to clarify this language that we felt was conflicting and that we had bought the technology, SCO had bought it, Novell had sold it. I went through that with Greg. Greg agreed with me and said: Yeah. That doesn't make sense. Let's try and figure out if there's a document out there somewhere. So, the first part was going out to try and find some documents that would help that. So if there was a thread through it, it was Greg was very helpful every step along the way to try and help us resolve the issues.

Q. Well, did they express a willingness to go back and search for documents?

A. Yes, they did. The first part of of it was Mr. Jones telling me: Let me go see what I can find out. I worked with Greg at Novell, and I knew him well. A lot of people had left over the ten years since I had worked there, so -- eight years, whatever it was. So -- but I did know Greg, and Greg was very helpful to, first of all, go try and find any documentation that would explain what was going on at the time of the deal.

That makes it sound like he and Greg Jones were kind of on the same wavelength, agreeing that there was just this one little bit of the agreement that made no sense to either of them, until, it is implied, some unknown someone higher up, maybe this Dave Wright person, interfered. Jones, as you will see, remembers it differently.

Now, Jones, being a lawyer, was allowed to stay in the courtroom when the other witnesses had to clear out, so he was sitting there listening to this account. I mention it only to say that it gives you some insight into Darl McBride, I think, his boldness, in that he gave the testimony he did with Jones sitting right there in the room. He had to know that Jones disagreed, from his earlier submissions in this litigation and the one between SCO and IBM.

Jones' testimony begins with page 303 of Part 2 [PDF] of the day's transcript, which is page 24 of the PDF, and continue with Part 3 [PDF] up to page 390.

The line numbers version is thanks to papafox, once again. When you read the summing up in the closing arguments, you'll see that both sides reference testimony by line number, so it matters to have this version, and also when we get to appeals, sometimes it also matters to be able to follow along by line number. So thank you to papafox for coming up with the script that made it endurable to do a long transcript with line numbers.

We've seen Greg Jones before, so to speak, by means of his Affidavit in support of Novell's successful motion to lift the stay in bankruptcy court. In his affidavit, he told the court in Delaware the following:

7. Novell intended with the APA to retain all Unix Copyrights and to protect its interest in all SVRX Royalties. In the event that SCO ultimately went into bankruptcy, the Unix Copyrights and the SVRX Royalties would, thus, not be part of the bankruptcy estate. The retention of the Unix Copyrights also protected Novell's other Unix-related interests, including the rights to negotiate buyouts of SVRX licenses, receive future revenues, and ensure development of future versions of the UNIX operating system.

We also saw a Declaration [PDF] of his back in September of 2006 in the SCO v. IBM case, one of the 597 exhibits IBM attached to IBM's various summary judgment motions. The bankruptcy cut across that path, and so they were never decided. Not yet, anyway, and in the meantime, the August 10 decision in the SCO v. Novell case cut into some of them, but someday, some happy day, we'll be picking up that dropped stitch once again.

Anyway, in the 2006 declaration, Jones told the court about the APA, what Santa Cruz got and what it didn't. And he tells about SCO's attempts to get the copyrights in 2002. Since we never got the Declaration done as text (597 exhibits all at once turned out to be Groklaw's Waterloo on transcribing) [Update: Erwan reminds me that we did do the transcript, but I forgot, which happens, so it was not quite our Waterloo. The Waterloo was updating the chart, which we are doing now], I'll show you now what he wrote about that back then:

SCO's Attempts to Acquire the UNIX Copyrights

13. In late 2002, SCO repeatedly contacted Novell. SCO requested access to or copies of any records concerning rights to UNIX, including any agreements between Novell and Santa Cruz....

14. SCO further requested that Novell transfer its UNIX copyrights to SCO, thereby acknowledging that it did not own the UNIX copyrights. SCO contacted Novell on multiple occasions in late 2002 and early 2003. For example, SCO's CEO, Darl McBride, repeatedly contacted Novell and asked Novell to amend the Novell-Santa Cruz agreement to give SCO the UNIX copyrights. Novell rejected all of these requests.

See what I mean about McBride knowing that Jones didn't agree with McBride's version of events?

This is our first opportunity to see David Melaugh at work for Novell. He asks the questions of Mr. Jones in the direct examination. Ted Normand for SCO does cross. Jones in addition to being a lawyer also has a degree in computer science from BYU and he worked as a programmer prior to law school, so tech questions are not beyond him, although he claims no expertise in that area now. I'd say that helps him to best Normand in the cross examination, though, when they get into what UnixWare is and how the APA related to it.

As for SCOsource, while SCO's position is that Novell never objected, so it felt free to go ahead, Jones says that while SCOfolk told Novell about a kind of licensing program, it was all quite vague on the details:

I had never seen anything that explained the exact terms of what that program might be or anything of that nature.

That's still true, as far as I'm concerned. If someone asked you to tell them precisely what SCOsource was licensing, could you answer? You could give any number of possibilities, based on quotations from the past and the present, but it's the poor judge who has to finally decide what it was all about. SCOsource was a movable feast, from SCO's perspective. Jones says that back in the 2002 and early 2003 timeframe, "they never got that specific with me."

Darl prepared a paper in 2003, Jones tells the court, which SCO sent to Novell, and when Jones saw it, he saw a reference to SVRX, but "it's not really an explanation of what the SCOsource program is. It was, instead," Jones says, "something they were proposing to do to define the rights in a way that they wanted to see them defined." And he tells further that no one from Novell signed the letter or agreed with it.

Not exactly matching up with McBride's testimony, is it? Jones also establishes that Novell had no warning in advance that SCO was going to enter into the Sun or the Microsoft agreements and in fact Novell only got to see the documents by demanding them in discovery.

When Jones first saw the Sun agreement, he saw it related back to the earlier 1994 agreement between Novell and Sun, and that made him read it and the Asset Purchase Agreement between Novell and Santa Cruz. After he read all that, he says that the Sun agreement primarily makes one very significant change:

Well, I guess, first of all, that indeed the 2003 agreement carries over many of the terms from the 1994 agreement, but it does, for all practical purposes, remove the confidentiality obligations for the source code that were part of the 1994 agreement.

In short, SCO was in effect open sourcing SVRX while simultaneously suing IBM for purportedly doing the same thing. I can't wait to get back to the IBM case. Remember all the whining about their sooper sekrit code, so utterly and contractually secret that not even SCO could show it to anyone without an NDA? Remember that farce? They had, meanwhile, already given Sun the right to display it to the entire world, from Jones' testimony. So I simply can't wait to hear them explain that to the judge, once the IBM case resumes.

The new rights Sun got, Jones says, make the SVRX licensing in the agreement not "incidental" to UnixWare. Yes, Sun had extensive sublicensing rights under the 1994 agreement, but only if it was done pursuant to terms at least as restrictive as those "that Sun uses for its most valuable proprietary source code." And Sun had an obligation to police sublicensees and take action to enforce the confidentiality. Suddenly in 2003, all that secrecy was lifted. Furthermore, since it was a change to an earlier agreement, SCO should have asked Novell's permission first, Jones tells the court. The license lists pre-APA SVRX technologies, he says, and they don't belong to SCO to open source, and yet in letting Sun open source Solaris, that's what SCO did. Jones relates how he compared Solaris code and SVRX, and lo and behold, SVRX is in there. He identified AT&T copyrights from 1989 which he shows to the court from OpenSolaris. He didn't find any UnixWare copyrights.

Ironic, no? We have come full circle. It's SCO open sourcing SVRX, in violation of Novell's proprietary IP. That's what really happened. While SCO in the end couldn't show us any infringed code of theirs, we find Novell claiming SCO violated Novell's copyrights. Who'd have predicted such legal humor? It's farcical indeed.

All the time SCO was calling on heaven above, and the US Congress, to note the wrongs they had suffered by having their most holy IP open sourced under the horrible GPL, which was allegedly such a danger to the economy, nay the world, they *knew* already that they'd given Sun the full right to open source Solaris themselves, under *any* license Sun wanted to use, according to Jones, even before they began the media push. Cynical? That's maybe not a strong enough word, if Jones is telling the truth, which I assume he would have to, since they were showing the judge the agreement as an exhibit at trial.

And what an icky role Sun played, to judge from Jones' description of the agreement. Look at all the damage that resulted from Sun's silence, the litigation that never had to happen. Frankly, if I were IBM or Red Hat or AutoZone or DaimlerChrysler, I'd at least be thinking about it some. And as far as Linux is concerned, why didn't Sun speak out to help? It had in the power of its hand the ability to protect Linux users. Silence. For years and years and years. While folks got sued, and the FUD campaign raged on. I realize a lot has changed since, but no matter how much I try to be an adult about it, it is infuriating to think that none of this had to happen, and when I just think about all I was put through... well, I'd best not think about it. It's worse than what I had thought. And to all of you who gave me a hard time back in 2003, when I wrote about what I viewed as Sun's role, you can all line up and apologize to me for falsely accusing me of being too hard on Sun. Looking back, with the Jones testimony ringing in my mind and heart, I'd have to say I never thought it was going to turn out to be as bad a picture as this testimony paints.

Jones also talks about the Microsoft license and the Computer Associates' SCOsource agreement. He views both as SVRX licenses, and with regard to the SCOsource licensing, he explains why like this:

And here, you know, there's a reference to -- that the UNIX-based code is UNIX System V or UnixWare. And so, these are, again, implicating versions of pre-APA SVRX in a context in which there are no -- this is not enhancing a previous agreement. This is not adding UnixWare rights on top of UNIX System V rights that were previously obtained. It's just a brand new grant. So I view this as an SVRX agreement.

And it's obvious, Jones says, that SCOsource was about preAPA copyrights, because when Novell publicly said that it, and not SCO, owned them, SCO sued them, claiming that Novell was damaging its SCOsource program. "And so -- so, basically, it's quite evident that the SVRX code was just critical to the SCOsource project," Jones tells the court.

Ted Normand then cross examines Jones for SCO. He asks if Novell claims trade secrets, if there are any, in UNIX System V, or if SCO owns them and ditto with respect to "know-how and methods and concepts in UNIX System V and UnixWare". I would take that question as an attempt to buttress the new SCO strategy, and save SCO's bacon at least somewhat in the IBM litigation. Jones' answer:

Post-APA versions of UnixWare, to the extent not implicating Novell's pre-APA copyrights in SVRX, and to the extent they are developed by SCO, as opposed to some partner of SCO or something, Novell would not be asserting rights to those, certainly.

I take his answer as saying that any methods and concepts from UNIX would be Novell's; any methods and concepts that SCO could claim on postAPA work might still be derivative of the earlier methods and concepts from codes the copyrights to which Novell owns. I'd say, in short, that this represents the death knell to any SCO methods and concepts arguments, as far as all current litigation goes. In short, you can read the Jones testimony as being Novell's position in the litigation. And then you get to see two lawyers trying to pin each other down. I enjoyed it immensely, but it'd be hard to explain why. My favorite part, if you are curious, is where Jones asks what Normand means by "UnixWare business", and Normand answers with a question: "What's the ambiguity as to what UnixWare business is?" That is Normand's "answer". And it doesn't throw Jones at all. He carefully draws a line around Novell's retained interest even in UnixWare. I just enjoyed watching them both at work. I guess you could sum up a lawyer's way of speaking as "don't tell 'em nuttin' unless you have to". It's like watching swordplay in a movie, two lawyers with words. And here they both know what they are doing, but Jones' computer background gives him an edge.

Update: I thought, for historians, I'd reproduce a screenshot from SCO's website back in August of 2004, from the SCOsource FAQ:

SCO has confidentiality clauses in *all* its contracts, eh? Lordy, these folks are too much.

Here's a link to the end of the transcript.

*************************

6 THE COURT: Thank you. You may step down,
7 Mr. McBride. I assume this witness may be excused.
8 MR. ACKER: Yes, on behalf of Novell, Your
9 Honor.
10 MR. SINGER: Yes, Your Honor.
11 THE COURT: You may call your next witness.
12 MR. MELAUGH: Your Honor, we call Greg Jones
13 GREG JONES,
14 the witness hereinbefore named, being first
15 duly cautioned and sworn or affirmed to tell the truth,
16 the whole truth, and nothing but the truth, was examined
17 and testified as follows:
18 THE COURT: Let's see, now. You're
19 Mr. Melaugh, right?
20 MR. MELAUGH: Yes, I am. Good morning, Your
21 Honor.
22 THE COURT: Good morning.
23 THE CLERK: Please state your name and spell it
24 for the record.
25 THE WITNESS: Greg Jones. G-r-e-g.

303

1 J-o-n-e-s.
2 THE CLERK: Thank you.
3
DIRECT EXAMINATION
4 BY MR. MELAUGH:
5 Q. Good good morning, Mr. Jones.
6 A. Good morning.
7 Q. Mr. Jones, could you please introduce yourself
8 to the Court?
9 A. Yes. I am Greg Jones. I am Vice President of
10 Technology Law at Novell.
11 Q. Mr. Jones, could you please describe your
12 educational background.
13 A. Yes. I have a Computer Science Degree from
14 Brigham Young University and also a Juris Doctorate
15 Degree from BYU.
16 Q. Could you please describe briefly your work
17 history following graduation from law school.
18 A. Following law school, I had a law clerk/baliff
19 position in Utah County, which included being law clerk
20 to a State District Judge. In March of '92, I joined
21 Novell. I have been at Novell since then, always in a
22 position of advising on intellectual property and
23 licensing matters, and I currently lead a team of
24 attorneys that supports Novell's R&D efforts.
25 Q. Mr. Jones, could I ask you to expand a bit on

304

1 your responsibilities during the timeframe at issue in
2 this case; say, from 2002 to the present?
3 A. Again, leading this team of attorneys and
4 paralegals in supporting the R&D efforts. So, that
5 includes inbound licensing of technology and other
6 intellectual property licensing. Also, if there are
7 disputes that arise or things of that nature that affect
8 the R&D organization, then we offer counsel and advice.
9 Q. Mr. Jones, you have been present in the
10 courtroom since we began; isn't that right?
11 A. Yes.
12 Q. And so you've heard the testimony of Mr. Sontag
13 yesterday, and Mr. McBride today?
14 A. Yes.
15 Q. I'd like to ask you about a segment of that
16 testimony. I believe the substance of it is that, both
17 from Mr. Sontag and from Mr. McBride, that SCO explained
18 the details of the SCOsource program to you; that you or
19 anyone else from Novell didn't say no to SCOsource; and
20 that, therefore, SCO felt it could proceed with the
21 SCOsource program.
22 How does that testimony comport with your
23 memory of these communications that are being talked
24 about?
25 A. Well, they both did speak of their belief that

305

1 UNIX intellectual property or code may be found in Linux.
2 I recall Mr. McBride talking about the libraries that he
3 alluded to. And I recall their desire to enforce their
4 rights. And, at one point, I do recall them saying that
5 the enforcement may be by means of a licensing program.
6 But I didn't have a full understanding exactly what
7 SCOsource would be or what it would entail. I had never
8 seen anything that explained the exact terms of what that
9 program might be or anything of that nature.
10 Q. Did they ever suggest to you, during these
11 communications, that SCO might sue Linux users for
12 infringement of SVRX copyrights?
13 A. They were not that specific.
14 Q. As part of these communications, did they ever
15 suggest to you that SCO was going to go out and license
16 SVRX?
17 A. Again, they were never that specific. In those
18 2002 conversations, where are they were introducing
19 themselves and what was happening, they never got that
20 specific with me.
21 Q. As well as the early 2003 communications; is
22 that right?
23 A. The only thing in 2003 was: There was this --
24 Mr. McBride aluded to a document they prepared and they
25 sent to Novell and, in looking at that document, which --

306

1 there is a reference to SVRX, but, again, it's not really
2 an explanation of what the SCOsource program is. It was,
3 instead, something they were proposing to do to define
4 the rights in a way that they wanted to see them
5 defined.
6 Q. And, and as a matter of fact, no one from
7 Novell signed that letter, no one from Novell agreed to
8 the letter that you're referencing?
9 A. That's correct.
10 Q. As part of these communications, did anyone
11 from SCO ever suggest to you or anyone else at Novell
12 that SCO was going to purport to authorize the open
13 sourcing of SVRX?
14 A. No.
15 Q. Did they ever suggest to you that they were
16 going to amend or -- and restate Sun's 1994 buyout
17 agreement?
18 A. No.
19 Q. Did they ever suggest to you, or anyone else at
20 Novell that you're aware of, that they were going to
21 enter into a license with Microsoft?
22 A. No.
23 Q. Mr. Jones, I'm going to show you an exhibit
24 that's not in the binder that you have. This has been
25 premarked as Exhibit 151 from Novell. I want to draw

307

1 your attention to the paragraph at the bottom of the
2 e-mail. This is from -- the paragraph right above that
3 that's from you.
4 THE COURT: This has not been admitted,
5 correct?
6 MR. MELAUGH: That's correct, Your Honor.
7 Q. Does this comport with your memory of the
8 communications that you have just described?
9 A. Yes.
10 Q. And I want to draw your attention to the top of
11 the e-mail. And this is a response from Chris Stone.
12 Does this comport with your memory of Novell's reaction
13 to SCO's proposal?
14 A. Yes.
15 MR. MELAUGH: Your Honor, I'd like to move
16 Exhibit 151 into evidence.
17 MR. NORMAND: No objection, Your Honor.
18 THE COURT: 151 is received.
19 (Novell's Exhibit 151 received in evidence.)
20 Q. Mr. Jones, if you could turn in your binder to
21 Exhibit 187. This is Novell Exhibit 187. It's been
22 pre-admitted. Mr. Jones, what is this?
23 A. This is a 2003 software license agreement
24 between Sun and SCO.
25 Q. Where did Novell obtain this document?

308

1 A. We obtained this document from SCO in discovery
2 in litigation.
3 Q. Did Novell have a copy of this document prior
4 to obtaining it in discovery in this litigation?
5 A. No.
6 Q. After receiving this agreement in discovery in
7 this litigation, what did you do?
8 A. Well, this agreement, you know, it relates back
9 to this 1994 agreement -- excuse me -- it relates back to
10 a 1994 agreement between Novell and Sun, and it says that
11 it meant to restate that agreement. So I went back and
12 looked at the 1994 agreement. Both of them identified
13 versions of SVRX as technologies that are being licensed,
14 so I also took a look at the Asset Purchase Agreement
15 between Novell and Santa Cruz, SCO.
16 Q. If you could turn for a moment to the next tab
17 in this Novell Exhibit 5, which has been pre-admitted,
18 what is this document, Mr. Jones?
19 A. This is a 1994 software license and
20 distribution agreement between Sun Microsystems and
21 Novell.
22 Q. Was this the 1994 agreement you were referring
23 to just a moment ago?
24 A. Yes.
25 Q. As a general matter, what is this agreement?

309

1 A. Well, this is an agreement under which Sun
2 bought out its royalty obligations for licenses to UNIX
3 technologies.
4 Q. After reviewing the Asset Purchase Agreement
5 and the 1994 agreement and the 2003 agreement, what was
6 your understanding of the relationship between these
7 three agreements?
8 A. Well, I guess, first of all, that indeed the
9 2003 agreement carries over many of the terms from the
10 1994 agreement, but it does, for all practical purposes,
11 remove the confidentiality obligations for the source
12 code that were part of the 1994 agreement.
13 I also note that the 2003 agreement, basically,
14 is a restatement of a buyout that was done. So this is
15 an agreement relating to a buyout of royalties that comes
16 under provisions of amendment number 2 to the Asset
17 Purchase Agreement, which requires that such agreements
18 not be entered without both parties' consent.
19 Also, the 2003 agreement relates to SVRX
20 technologies and substantial new rights being granted
21 with respect to them, independent of the UnixWare
22 technologies identified in the agreement. So, it is an
23 SVRX agreement.
24 The licensing of SVRXs is not merely incidental
25 to UnixWare. It's not minor. Expansive rights were

310

1 granted with respect to SVRX, that it could even be
2 released as open source. So, this is also an agreement
3 that, under the Asset Purchase Agreement, should not have
4 been entered without Novell's approval.
5 Q. So, let's walk through that again. You -- I
6 think, the first part of your answer referred to
7 confidentiality obligations that were in the 1994
8 agreement and in the 2003 agreement. Are you referring
9 to the -- at least, in part, to the sections that are on
10 the screen now?
11 A. Yes. This is from the 2003 agreement, right?
12 Q. Can you walk us through your understanding of
13 these sections?
14 A. Well, so -- well, so, first have all, 10.1 is
15 just a general -- I'm sorry 10.1 is --
16 Q. 10.1 is from 1994, to be clear, and the bottom
17 one is from 2003.
18 A. So 10.1 is from the 1994 agreement and imposes
19 confidentiality restrictions, of course. I'd add that
20 there are other provisions in the 1994 agreement that
21 also provide that any source code sublicensing has to be
22 done pursuant to terms at least as restrictive as those
23 that Sun uses for its most valuable proprietary source
24 code.
25 So, while there were significant sublicensing

311

1 rights in the 1994 agreement, they were very tightly
2 controlled. And, furthermore, Sun had an obligation to
3 police those licenses and to act on any violations of the
4 confidentiality.
5 And, by contrast, I look at Section 8, Roman 1,
6 towards the bottom, which basically says that if Sun
7 distributes these UNIX technologies under a license model
8 of Sun's choosing, then, at that point, those
9 technologies are no longer confidential, and there are no
10 longer any confidentiality requirements that apply to
11 that technology.
12 Q. I believe you said it was also your
13 understanding that SVRX plays a significant role in the
14 2003 SCOsource license. What led you to that conclusion?
15 A. Well, simply that the SVRX products are
16 identified on the schedules and that this dramatic
17 expansion of rights received by virtue of removing the
18 confidentiality applies across the board to all of the
19 technologies that are identified, whether it's UnixWare
20 or earlier versions of SVRX that predated the APA.
21 Q. Stepping back to this change in the
22 confidentiality obligations, what significance do you
23 attribute to this change?
24 A. What significance in terms of how it's
25 important?

312

1 Q. In the context of what you know about Sun's
2 business, the actions Sun took after entering into this
3 license?
4 A. So, Sun has an operating system known as
5 Solaris. It's a UNIX variant. It's competitive with
6 Linux. This 2003 agreement allows Sun, then, to release
7 Solaris as open source under an open source licensing
8 model, which they have done in a project called
9 OpenSolaris. So it poses a direct competitive challenge
10 to Linux and, certainly, to Novell, given that Linux is
11 an important part of Novell's business. We are a Linux
12 distributor.
13 Q. Do you know whether there is any SVRX code in
14 Sun's OpenSolaris product?
15 A. Yes.
16 Q. How do you know that?
17 A. Well, Novell has SVRX code in its possession,
18 and so I obtained source code files from Novell's
19 personnel, and then I downloaded source code from
20 OpenSolaris. I found those same files, and sometimes
21 with some degree of difference or change but, in the
22 majority's of instances, identical in the OpenSolaris
23 project. So I took those files, compared them
24 side-by-side, so I was able to find SVRX files in the
25 OpenSolaris project.

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1 Q. You said you downloaded the OpenSolaris code.
2 Is that something anyone can do?
3 A. Yes. Anyone can do that.
4 Q. And do you have to pay any money to download
5 the OpenSolaris code?
6 A. No.
7 Q. Do you have to sign an agreement to download
8 the OpenSolaris code?
9 A. No. You don't have to do that.
10 Q. If you could turn to Exhibit 439 in your
11 binder. This is Novell Exhibit 439. It has not yet been
12 admitted. Mr. Jones, could you describe what 439 is.
13 A. Well, the right-hand side of this document
14 contains the -- just the contents of one of the SVRX
15 files that I looked at, this one called Auto Push.C, and
16 the left side of the document, the left column, is a
17 corresponding file that comes out of the OpenSolaris
18 project.
19 Q. And what's significant to you in the text of
20 the chart that we're looking at right now?
21 A. Well, one thing just of note is, of course, Sun
22 has included its open source license notice at the top of
23 the file, but then below that, on the left-hand side, we
24 see an AT&T copyright notice, with the latest year of
25 creation of code being 1989. And then we just jump

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1 across the page to the SVRX side and see basically the
2 identical copyright notice.
3 And from there on, you can see what's striking
4 is that while there are places where there are some
5 additional text or a minor difference, there are just
6 extensive portions of the file where what you find is
7 that they are identical.
8 Q. And, moving to the second page of this chart,
9 is that what we're seeing here?
10 A. Yes.
11 MR. MELAUGH: Your Honor, I'd like to move
12 Exhibit 439 into evidence.
13 MR. NORMAND: No objection.
14 THE COURT: 439 is received.
15 (Novell's Exhibit 439 received in evidence.)
16 Q. Mr. Jones, if you could turn to Exhibit 440.
17 Could you tell us what this exhibit is?
18 A. Yes. Again, this is a document in which the
19 right column includes the contents of a source code file
20 from SVRX, Disk USG.C, and the left column is a -- the
21 corresponding file that I downloaded from the OpenSolaris
22 project. And, as with the previous exhibit, you look at
23 the copyright notices. You see the commonalities.
24 On this particular one, you see that Sun notes
25 that it made some modifications in 1999, so they are not

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1 going to be identical in every respect, but you walk down
2 through the file and they are identical in many respects.
3 And it's evident that the OpenSolaris file is based on
4 the SVRX file.
5 Q. Mr. Jones -- I move Exhibit 440 into evidence,
6 Your Honor.
7 MR. NORMAND: No objection.
8 THE COURT: 440 is received.
9 (Novell's Exhibit 440 received in evidence.)
10 Q. Mr. Jones, if you could turn -- and we will
11 just address this briefly, to Exhibit 441. Is this
12 similar to what we've seen with the past two exhibits?
13 A. Yes. It's the same. Again, on the right-hand
14 side, the contents of a source code file from SVRX; on
15 the left-hand side, the contents of a source code file
16 from the OpenSolaris project. The file names are the
17 same, and it's quite clear, as you walk through, the
18 similarities show that the OpenSolaris file was based on
19 the SVRX file.
20 MR. MELAUGH: Your Honor, I move Novell Exhibit
21 441 into evidence.
22 MR. NORMAND: No objection.
23 THE COURT: 441 is received.
24 (Plaintiff's 441 Exhibit received in evidence.)
25 Q. Greg, if you could just page through the

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1 exhibits that follow in this book. I'm going to list
2 them off for the record. They are Novell Exhibits 442,
3 443, 446, 447, 448, 449, 450, 451, 452, 453, 455, 456,
4 458 and 459.
5 Mr. Jones, are these exhibits similar to the
6 three that we have just taken a look at?
7 A. Yes.
8 MR. NORMAND: No, objection.
9 MR. MELAUGH: Your Honor, I move these exhibits
10 into evidence.
11 THE COURT: Same nature. Any objection?
12 MR. NOLRMAND: Your Honor, I said no objection.
13 THE COURT: I didn't hear you.
14 MR. NORMAND: I'm sorry.
15 THE COURT: 442, 443, 446, 447, 448, 449, 450,
16 451, 452, 453, 455, 456, 458 and 459 are received.
17 (Novel Exhibits 442, 443, 446, 447, 448,
18 449, 450, 451, 452, 453, 455, 456, 458
19 and 459 received in evidence.)
20 MR. MELAUGH: Thank you, Your Honor.
21 Q. Mr. Jones, do you know whether there is any SCO
22 UnixWare code in OpenSolaris?
23 A. I have not done a comprehensive search. I did
24 search on the OpenSolaris site for any reference to Santa
25 Cruze or SCO that would appear on a copyright notice. I

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1 didn't find anything, but I didn't make a comprehensive
2 effort to identify UnixWare code in OpenSolaris.
3 Q. When you say "search on the OpenSolaris web
4 site," what do you mean?
5 A. There is a -- if you go to the OpenSolaris site
6 on the internet, there is a user interface there, and
7 there is a utility that allows you to do text searches
8 that searches through the text of the source code files
9 that are there on the OpenSolaris site.
10 Q. I'm sorry. What were the terms that you
11 searched for in that code?
12 A. Two of them, Santa Cruz and SCO. Yeah. I
13 also -- I also did Caldera. There was one Caldera
14 file.
15 Q. And by "file," are you referring to copyright
16 notices? What are you referring to when you say that?
17 A. Again, all I looked for is whether those terms
18 appeared in any copyright notices, and I could not see
19 them appearing in a copyright notice.
20 Q. Did SCO obtain Novell's permission to enter
21 into the 2003 Sun SCOsource license?
22 A. No.
23 Q. Would Novell have consented to the 2003 Sun
24 SCOsource license if SCO had asked?
25 A. No.

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1 Q. Why not?
2 A. Well, it simply would not have been in Novell's
3 commercial interests. In the fall of 2002, Novell had
4 acquired Simeon a Linux desk top company. We were
5 exploring ways to get into the Linux market so enabling a
6 competitor to Linux simply would not have been in
7 Novell's interests. In the manner in which they entered
8 this agreement, when they did it, they kept all the
9 money. I assume that would have been their proposal but,
10 fundamentally, it simply would have been contrary to
11 Novell's business interests to enable something like
12 this.
13 Q. What amount does Novell seek from the Sun
14 SCOsource licensse?
15 A. Everything that was paid.
16 Q. Why does Novell believe it is entitled to that
17 amount?
18 A. Well, there were expansive rights granted with
19 respect to the versions of SVRX that pre-date --
20 post-date -- pre-date the Asset Purchase Agreement.
21 These were dramatically greater rights than were enjoyed
22 under the 1994 agreement, and there is nothing in the
23 agreement that assigns any value to anything other than
24 the SVRX technologies for which Novell is entitled to
25 receive royalties.

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1 The customary 5 percent administrative fee that
2 SCO normally receives for collecting SVRX royalties just
3 doesn't seem to be germane in this particular instance.
4 Q. Based on your experience with software
5 licensing, would you describe the 2003 Sun SCOsource
6 license as a typical software license?
7 A. No. I mean, it's an extraordinary agreement.
8 When you enter an agreement where you take the step of
9 going from proprietary to open source, that is quite a
10 dramatic change. And so it's not something you would
11 custom -- certainly it would not be what you would
12 customarily see in an agreement. It's an extraordinary
13 agreement.
14 Q. 267, Novell's 267.
15 Did Novell ever ask SCO whether SCO considered
16 the Sun license an incidental license of SVRX?
17 A. Yes.
18 Q. Are you familiar with the letter -- we have had
19 testimony about this so far. Are you familiar with this
20 letter that's Exhibit 267?
21 A. Yes.
22 Q. This is a letter to Mr. Bench, dated November
23 21, 2003, correct?
24 A. Correct.
25 Q. If I could draw your attention to the second

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1 page of the letter, paragraph 1.2. So, what's going on
2 in this paragraph, Mr. Jones?
3 A. Well, this simply -- it's an audit letter, of
4 course, so this is describing to SCO this particular
5 aspect of amendment 1 to the Asset Purchase Agreement
6 that does allow SCO to engage in certain SVRX licensing
7 activities if they are incidental -- well, just as it
8 says right there: As may be incidentally involved
9 through SCO's right to sell and license UnixWare
10 software.
11 So, this paragraph kind of says: Okay. Let's
12 talk about this topic here.
13 Q. Let's take a look at paragraph 1.6.
14 A. Okay.
15 Q. And so what's going on in Exhibit 1.6?
16 A. That is an invitation to SCO to say, you know,
17 if the activities -- any activities that you're
18 participating in that qualify for these exceptions, then,
19 you know, please make those known to us.
20 Q. And if we could take a look at paragraph 2.1.
21 And the same question here, Mr. Jones: What's going on
22 in this paragraph?
23 A. So, again, we're introducing the topic of:
24 We're aware that there is this exception in the context
25 of incidental licensing and so I think it's, again, going

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1 to be an invitation for them to let us know if they
2 believe any of their activities would qualify for this
3 exception.
4 Q. So, after asking three times in this letter,
5 Mr. Jones, up and until this litigation, did SCO ever say
6 to Novell that the reason it was entitled to the Sun
7 SCOsource revenue was because that license was an
8 incidental SVRX license?
9 A. No.
10 Q. Mr. Jones, if you could turn to Exhibit 189 in
11 your binder. What is this exhibit, Mr. Jones?
12 A. This is a release, license and option agreement
13 between Microsoft and Caldera International d/b/a the SCO
14 group, now known as SCO.
15 Q. Where did Novell obtain this document?
16 A. We obtained this in discovery in this
17 litigation.
18 Q. Before obtaining this document in discovery in
19 this litigation, did Novell have a copy of this
20 document?
21 A. No.
22 Q. After receiving the 2003 Microsoft SCOsource
23 license, what did you do?
24 A. Well, this agreement -- again, you know, you go
25 through a license agreement to see what technology is

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1 being licensed. And I observed there numerous versions
2 of SVRX identified as licensed technologies. So I then
3 took out the Asset Purchase Agreement between Novell and
4 SCO and looked at this agreement in light of the terms of
5 the Asset Purchase Agreement.
6 Q. After conducting that review, what was your
7 understanding of the 2003 Microsoft SCOsource license as
8 it concerns the Asset Purchase Agreement?
9 A. Well, it's certainly an SVRX agreement. I
10 think it's been found that an SVRX agreement is one that
11 relates to SVRX code. And this one certainly does. I
12 also look at it from the perspective of whether this
13 exception for licensing of SVRX incidental to UnixWare
14 might be germane.
15 In this instance, I look at the identification
16 of all of these SVRX technologies, and I look at the
17 broad intellectual property licenses that are granted
18 under the agreement. And I see that there is -- this is
19 not an amendment to an existing agreement. This is not
20 adding rights to rights already acquired. So, basically,
21 all of the rights to the SVRX technologies are new, and,
22 again, they are quite expansive as you march through the
23 options.
24 So I look at this as an SVRX agreement that
25 should not have been entered without Novell's approval.

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1 There is a Section 3 that relates solely to UnixWare, but
2 the overall agreement is an SVRX agreement, and those
3 other parts are so substantial that I can't view them as
4 being really incidental to the UnixWare component of the
5 agreement.
6 Q. Did SCO obtain Novell's permission to enter
7 into the 2003 Microsoft SCOsource agreement?
8 A. No.
9 Q. Would Novell have consented to the 2003
10 Microsoft SCOsource agreement if SCO had asked?
11 A. No. I just can't see, again, any commercial
12 benefit to Novell from this particular agreement, and so,
13 no.
14 Q. What amount does Novell seek from the 2003
15 Microsoft agreement?
16 A. Well, I actually don't know the specific figure
17 myself. It's whatever amounts were paid under Section 2
18 and under Section 4 of the agreement, but not whatever
19 was paid under Section 3.
20 Q. So let's walk through those.
21 A. Okay.
22 Q. If we could put up Section 2, please. Why is
23 Novell entitled to the revenue from Section 2?
24 A. Well, here, you know, we have these licenses
25 that broadly relate to SCO's, you know, intellectual

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1 property rights. And I think, at that point in time, I
2 simply -- I can't avoid looking at this in the context of
3 what was going on in the marketplace in terms of the
4 dramatic representation being made about SCO ownership of
5 UNIX technologies, historic UNIX and so forth.
6 And so, looking at that context, in combination
7 with Section 2, I say, basically, this is an invitation
8 for someone to use intellectual property when in the end
9 it has been found to be Novell's. There is no
10 apportionment, value-wise, in this agreement as to, you
11 know, how many dollars correspond to this or that. And I
12 think Novell is entitled to conclude that all of it
13 should come to Novell.
14 Q. What do you -- what conclusions have you come
15 to about the Section 3 revenue, Mr. Jones?
16 A. Well, as previously mentioned, you know, this
17 is something that Novell is not pursuing. It is -- it is
18 the case that the Section 4 rights that, again, relate to
19 SVRX, can't be obtained without these Section 3 UnixWare
20 optional rights being exercised or being purchased, but
21 we're not pursuing it.
22 Q. Are you at Section 4 now?
23 A. Yes.
24 Q. Mr. Jones, why is Novell entitled to the
25 revenue from Section 4?

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1 A. Well, again, Section 4, the license grant
2 relates to all the technologies identified in the
3 agreement, including those in Exhibit C, which is a list
4 of SVRX, pre-APA SVRX technologies. And, again, these
5 are new rights. I don't see any evidence of -- that
6 these are merely restating rights previously obtained
7 under some separate agreement, that these are new rights
8 that are being received to SVRX technologies. I simply
9 cannot conclude that this is incidental to UnixWare.
10 They are substantial rights.
11 There is no -- there is nothing on the face of
12 the agreement, or otherwise, by which SCO has attempted
13 to assign value to the UnixWare-unique portion of this
14 section. So I think Novell is entitled to conclude that
15 Novell should receive all of this money.
16 Q. Mr. Jones, if you could turn to what's been
17 marked as Novell Exhibit 237, which has been
18 pre-admitted.
19 A. I think I -- I think I should add that, in
20 these instances, one thing that factors into my
21 conclusion in terms of Novell's being entitled to draw
22 these conclusions is that Novell was counting on SCO to
23 be our fiduciary, to look at these SVRX agreements, to
24 bring them to our attention if our rights were
25 implicated.

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1 And, as demonstrated by our repeated requests
2 for these agreements, and those requests being rejected,
3 we had absolutely no visibility as to what was going on
4 with these transactions. And so, there was -- to me,
5 there is a heightened responsibility here, and it
6 lends -- and that lends to Novell's being entitled to
7 conclude that we should receive all these monies.
8 Q. And I asked you earlier -- we saw that letter
9 from Mr. Bready, and I asked you earlier whether SCO had
10 ever said that the Sun license was incidental up until
11 this litigation. Did SCO ever say that the Microsoft
12 license -- that it was entitled to the Microsoft money
13 because it was an incidental license of SVRX, up until
14 this litigation?
15 A. No.
16 Q. So now we're on Exhibit 237, Mr. Jones. What
17 is this document?
18 A. This is a SCO Group intellectual property
19 compliance license for SCO UNIX rights. The agreement is
20 between SCO, obviously, and Computer Associates.
21 Q. Where did Novell obtain this document?
22 A. In discovery in this litigation from SCO.
23 Q. And, prior to obtaining this document in
24 discovery in this litigation, did Novell have a copy of
25 this document?

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1 A. No.
2 Q. After receiving this intellectual property
3 compliance license, what did you do?
4 A. Well, again, this is -- it's a license, so I
5 look for what technology is being licensed or what
6 intellectual property rights, and, you know, so I go
7 to -- and you'll see that, you know, a key term here is
8 that this is UNIX-based code.
9 Q. You're looking on the second page now?
10 A. Yeah, on the second page.
11 Q. And at 1.14, is that what you're looking at?
12 A. Right. And here, you know, there's a reference
13 to -- that the UNIX-based code is UNIX System V or
14 UnixWare. And so, these are, again, implicating versions
15 of pre-APA SVRX in a context in which there are no --
16 this is not enhancing a previous agreement. This is not
17 adding UnixWare rights on top of UNIX System V rights
18 that were previously obtained. It's just a brand new
19 grant. So I view this as an SVRX agreement.
20 Q. What's your understanding of the larger context
21 in which this SCOsource license and the SCOsource
22 licensing campaign is taking place?
23 A. Well, this was obviously a very public campaign
24 that SCO was undertaking, and in a very -- a public
25 campaign carried out in a very public way; a lot of

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1 publicity and a lot of assertions of rights and a lot of
2 assertions that Linux included UNIX code. And so, it was
3 in that context that these types of agreements were being
4 offered to people.
5 Q. And do you have an understanding of what code
6 SCO claims is at issue in SCOsource, is at issue in
7 Linux?
8 A. Well, you know, clearly, Novell's assertion of
9 ownership to the SVRX -- the pre-APA SVRX copyrights
10 basically precipitated this litigation, and there were
11 claims that this was causing great damage to SCO as a
12 result of damaging the SCOsource program itself.
13 And so -- so, basically, it's quite evident
14 that the SVRX code was just critical to the SCOsource
15 project.
16 Q. Has Novell ever claimed to own copyrights to
17 SCO UnixWare?
18 A. No. If by "SCO UnixWare," you mean any
19 UnixWare code produced after the date of the Asset
20 Purchase Agreement, no.
21 Q. Did SCO obtain Novell's permission to enter
22 into the license that we're looking at right now?
23 A. No.
24 Q. Would Novell have consented if SCO had asked?
25 A. No.

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1 Q. Why not?
2 A. Well, again, this is entered into in August of
3 2003, and, again, in the fall of 2002, Novell's going in
4 the direction of Linux, and this would simply be
5 completely contrary to Novell's business interests, among
6 other things. There's just no -- no benefit to Novell to
7 enter such an agreement, and a down side.
8 Q. What revenue from this agreement does Novell
9 seek?
10 A. All of it.
11 Q. Why is that?
12 A. Again, this is one where there are substantial
13 SVRX rights granted. There is no allocation or
14 identification of value uniquely associated with
15 UnixWare, and, again, all this is in the context of SCO
16 being Novell's fiduciary and entering SVRX-related
17 agreements and not disclosing them to us, and we are not
18 in a position to protect our rights
19 Q. If you could look briefly at the exhibits that
20 follow, Mr. Jones. For the record those are Novell
21 Exhibit 286, Novell Exhibit 300, Novell Exhibit 309,
22 Novell Exhibit 322, Novell Exhibit 349, Novell Exhibit
23 422 and Novell Exhibit 426, all of which have been
24 pre-admitted in this litigation.
25 As a general matter, what are these exhibits,

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1 Mr. Jones?
2 A. These are all agreements of a like nature.
3 Their terms may vary in some, I think, immaterial
4 respects, for our purposes, but they are all -- well,
5 they are all agreements that purport to license the
6 licensee to use any UNIX code that is found in copies of
7 Linux that the licensee is using; and, again, whether
8 it's UNIX System V code or UnixWare code.
9 Q. Did SCO obtain Novell's permission to enter
10 into any of these licenses?
11 A. No.
12 Q. And would Novell have consented to these
13 licenses, if asked?
14 A. No.
15 Q. What revenue does Novell seek from these
16 licenses?
17 A. All of the revenue. There is no specification
18 in the agreements as to any specific amount that's
19 associated with UnixWare, and there are substantial SVRX
20 rights granted, and there's a fiduciary relationship
21 here. So I think we are entitled to all of them. Again,
22 the 5 percent administrative fee that Novell normally
23 allows SCO for collecting royalties doesn't seem germane
24 here.
25 MR. MELAUGH: Thank you, Mr. Jones.

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1 THE COURT: Thank you, Mr. Melaugh.
2 Mr. Normand, you may cross examine.
3 MR. NORMAND: Thank you, Your Honor.
4
CROSS EXAMINATION
5 BY MR. NORMAND:
6 Q. Still good morning, Mr. Jones.
7 A. Good morning.
8 Q. You're a lawyer, right?
9 A. Yes.
10 Q. How long have you been a lawyer?
11 A. Since 1990.
12 Q. Did you ever work in selling any software
13 products since you have been at Novell?
14 A. No. I have been involved in the outbound
15 licensing of technologies for revenue. I've assisted --
16 I have assisted in a legal role in supporting sales
17 efforts, but it's not been, by any means, my primary
18 responsibility or my focus.
19 Q. Hve you been involved in pricing any software
20 products, while at Novell?
21 A. Very tangentially.
22 Q. Did you ever work in marketing any software
23 products at Novell?
24 A. Probably not even tangentially.
25 Q. Did you ever have occasion to negotiate the

332

1 terms of any software agreement regarding UNIX at your
2 time at Novell?
3 A. Yes.
4 Q. Can you please explain that?
5 A. It was -- there was a -- it was after the Asset
6 Purchase Agreement, there was a source code licensee that
7 had -- was involved in a buyout situation, and so I
8 participated to some extent in that. I was not the
9 primary person responsible for doing that.
10 Q. Do you remember the name of the licensee?
11 A. I think it was Silicone Graphics, Silicone
12 Graphics and Cray.
13 Q. And do you recall dealing with Santa Cruz on
14 that issue at all?
15 A. I believe Santa Cruz was involved, but I can't
16 recall whether I'm one of the people who spoke to them.
17 Q. How much familiarity with how computer
18 operating systems are developed do you have?
19 A. I have a general familiarity. I have been --
20 you know, I have a computer science degree. I have been
21 working in the industry. I have been legal counsel to a
22 company that develops and markets operating systems and
23 legal issues associated with the development process and
24 so forth. So, I don't know how to quantify my knowledge,
25 but I come from that background.

333

1 Q. Have you ever worked as a programmer,
2 professionally?
3 A. Yes.
4 Q. And when?
5 A. This was prior to law school, just working for
6 a small software company.
7 Q. What operating systems did you deal with?
8 A. There? Well, one was Solaris. And I can't
9 recall the other operating systems that we were using.
10 Q. Did you have an understanding, at that time, as
11 to the origins of Solaris?
12 A. At that point in time? No.
13 Q. Do you now?
14 A. To some extent, yes.
15 Q. What is that understanding?
16 A. Well, that Solaris is an SVRX-based operating
17 system.
18 Q. Which release?
19 A. Well, I generally understand SVRX 4. My
20 knowledge is no more specific than that, and that -- and
21 that, basically, Solaris is one of the many source code
22 licensees that takes a source code license and then will
23 create their own variant, and so Solaris is the Sun
24 variant of SVRX 4.
25 Q. Do you know how Solaris was developed?

334

1 A. I'm not sure what you mean.
2 Q. AT&T developed Solaris with Sun, correct?
3 A. You're saying -- if AT&T and Solaris worked
4 together, side-by-side, to develop Sun? I'm not aware of
5 that one way or another, so I don't know what you're
6 asking about.
7 Q. Let me ask it again because I think you flipped
8 Solaris and Sun in your answer. Do you know how the SVR
9 4 operating system was developed?
10 A. Well, I have a general understanding that AT&T
11 developed the base UNIX technologies and that, at a
12 certain point in time, there was a subsidiary, UNIX
13 System Laboratories, that was created. They would
14 advance the core UNIX technologies and then they would
15 license out that source code to the various UNIX OEMs.
16 Q. Now, when it came time for AT&T and USL to move
17 from Release 3 to Release 4, in developing Release 4,
18 they actually worked with Sun, didn't they?
19 A. I have no knowledge one way or another on
20 that.
21 Q. And when Sun developed Solaris, it did so
22 simultaneously with the development of Release 4,
23 correct?
24 A. I'm not sure exactly what you mean.
25 Q. Do you have a view as to whether Solaris

335

1 contains any significant amount of SVR 4 technology?
2 A. My understanding has been that it does.
3 Q. Do you know whether previous versions of UNIX
4 contained source code included in UnixWare?
5 A. Previous to what?
6 Q. Previous to the latest release of System V that
7 UnixWare represents?
8 A. My general understanding is that you would
9 find, in the latest release of UnixWare, code that had
10 been in earlier versions of UnixWare SVRX.
11 Q. And code that had been in earlier versions of
12 System V might not have made its way into UnixWare,
13 correct?
14 A. Yeah. I'd -- yeah. I don't know that for a
15 fact, but you say "might," and that sounds very possible
16 to me.
17 Q. Do you have a view as to whether, if code from
18 older versions of System V has not made its way into
19 UnixWare, do you have a view as to whether that older
20 code has any commercial value?
21 A. Well, yes.
22 Q. What's your view?
23 A. Well, in terms of -- to me, there are at least
24 two types of commercial value. One commercial value is
25 that there is actual technical merit that is still placed

336

1 on the marketplace, and I can't opine one way or the
2 other. The other is that there are intellectual property
3 rights associated with the technology but that,
4 independent of that current technical merit of that code
5 base, could have some relevance in the marketplace.
6 Q. Do you have a view as to whether UNIX System V,
7 Release 2, for example, has any commercial value?
8 A. I just -- well, in that respect that I just set
9 out, I would say, with respect to whether it has
10 technical merit, I'm not in a position to say. As to
11 whether the intellectual property rights associated with
12 it potentially have value, potentially.
13 Q. But you don't have a view one way or the other?
14 A. I think I would have a bias towards -- well,
15 which release is it?
16 Q. Release 2.
17 A. UNIX System V? So it's SVR 2?
18 Q. Two.
19 A. Let me see. Well, you know, copyright lasts
20 for a long time, and so if that code is still available,
21 potentially it could have commercial value in the sense
22 that I stated, for the intellectual property.
23 Q. As someone with programming experience, do you
24 have any view as to whether there is any existing
25 hardware that you could run SVR 2 on?

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1 A. I don't know. I don't know.
2 Q. Now, in Novell's view, if there are trade
3 secrets in UNIX System V, SCO owns them, correct?
4 A. I believe that's been Novell's position.
5 Q. And was that your position at deposition?
6 A. I think so.
7 Q. And, in Novell's view, SCO owns the software
8 know-how and methods and concepts in UNIX System V and
9 UnixWare, correct?
10 A. You're talking post-APA UnixWare, these
11 rights -- independent of copyright?
12 Q. I'm asking you whether, in your view --
13 A. And I'll answer it this way. Post-APA versions
14 of UnixWare, to the extent not implicating Novell's
15 pre-APA copyrights in SVRX, and to the extent they are
16 developed by SCO, as opposed to some partner of SCO or
17 something, Novell would not be asserting rights to those,
18 certainly.
19 MR. NORMAND: Your Honor, could I publish a
20 portion of Mr. Jones' deposition in this case?
21 THE COURT: Sure.
22 (A portion of the deposition was played.)
23 MR. NORMAND: That's from Mr. Jones' May 10,
24 2007 deposition, Rule 30(b)(6); at page 36, line 24, to
25 page 38, line 1.

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1 Q. Mr. Jones, in Novell's view, it would not be
2 accurate to say that Novell had transferred its existing
3 ownership interest in the UNIX System V products to Santa
4 Cruz in 1995, correct?
5 A. Could you say that again?
6 Q. In Novell's view, it would not be accurate to
7 say that Novell had transferred its existing ownership
8 interests in UNIX System V to Santa Cruz in 1995,
9 correct?
10 A. Right.
11 THE COURT: SCO 411?
12 MR. NORMAND: Yes, Your Honor.
13 Q. Mr. Jones, this is a document dated May 23,
14 1996. Do you recognize the document?
15 A. Yes. I've seen it before.
16 Q. And the second full paragraph says:
17 As you may have heard, Novell has transferred
18 to Santa Cruz, Santa Cruz Operation, Inc., Novell's
19 existing ownership interest in the UNIX System-based
20 offerings and related products, collectively transferred
21 products.
22 Do you see that line?
23 A. Yes.
24 Q. And you think that that's an inaccurate
25 statement, correct?

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1 A. Yes.
2 Q. Do you have any explanation for why Mr. DeFazio
3 would sign a document containing such a statement?
4 A. No.
5 Q. Have you spoken with Mr. Defazio about that
6 issue?
7 A. No.
8 Q. Mr. Jones, do you have a view as to whether a
9 UnixWare license gives the licensee the right to use all
10 prior releases of UNIX System V?
11 A. I take it a UnixWare license to be a license to
12 a stand-alone version of UnixWare, and then I would say
13 that that license includes rights to any code contained
14 in it, and if it so happens that some of that code was in
15 prior releases of UNIX, then the licensee is receiving
16 licenses to that code.
17 Q. Do you have any view as to whether, when Novell
18 owned the UNIX business, it granted rights to the
19 previous releases of System V when it did a license of
20 the most recent releases of System V?
21 A. I've had some exposure to that in this
22 litigation and seeing what's come forward in discovery.
23 It seems -- what I have seen is that that happens when
24 consideration has been given for the prior products that
25 are in the agreement.

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1 But, as I have told you before, and as you were
2 inquiring today, you know, my career focus has not been
3 doing sales agreements and things of that nature, so --
4 Q. Did you watch your counsel's opening argument?
5 A. Yes.
6 Q. Did you see reference made to the NCR
7 supplements?
8 A. Yes.
9 Q. Do you recall what the number of that
10 supplement was?
11 A. 112.
12 Q. And it's your position, as you understand it --
13 when I say "you," I mean Novell. It's Novell's position
14 that the only reason the System V prior products were
15 listed for NCR was because it had previously obtained a
16 stand-alone license to every previous release of System
17 V?
18 A. Well, what I heard was that, in fact, the
19 licenses had been obtained for previous releases. I
20 don't necessarily recall having heard that's the only
21 reason. I just can't recall.
22 Q. I may have misunderstood your answer. I
23 thought you said that your understanding was that the
24 only reason System V prior products would be listed would
25 be if the licensee had already obtained a stand-alone

341

1 license to all those releases.
2 A. Did I say "only?"
3 Q. That's what I understood you to say.
4 A. Okay. I -- and I thought I prefaced it with
5 generally. But, I mean, what I have -- my impression
6 that I have formed after seeing the documents that I have
7 been able to see in this litigation is that consideration
8 has been given for prior products. And I, again, tell
9 you that I have not surveyed all these agreements. That
10 has not been my purview. That's is not what I am
11 about.
12 Q. Can you recall coming across any agreements
13 where that could not have been true?
14 A. No.
15 Q. Are you familiar with the language in the APA
16 providing that Novell would receive royalties from SCO's
17 sales of UnixWare if certain conditions were met?
18 A. Yes.
19 Q. You were here for Mr. McBride's testimony,
20 right?
21 A. Yes.
22 Q. So you heard questions and answers regarding
23 floors and thresholds regarding UnixWare sales?
24 A. Actually I think my mind drifted off at that
25 point, but I have seen those parts of the agreement.

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1 Q. Are you familiar with language in the APA
2 providing that, after December 31, 2002, Novell would not
3 receive any royalties from SCO's sales of UnixWare, even
4 if the conditions were met?
5 A. Yeah, something to that effect. I know that
6 there was a cut-off date and so forth.
7 Q. So, in Novell's view, after December 31, 2002,
8 SCO had the right to retain all royalties it received for
9 licensing UnixWare, correct?
10 A. Clearly, from the language, at least,
11 stand-alone versions of UnixWare.
12 Q. And, in Novell's view, in fact, the entire
13 intent of the APA was for the UnixWare business to be
14 transitioned to Santa Cruz, correct?
15 A. Could you say that again?
16 Q. In your view and in Novell's view, the entire
17 intent of the APA was for the UnixWare business to be
18 transitioned to SCO, correct?
19 A. Well, I don't -- I guess the only thing I would
20 say is: You know, in terms of entire intent, certainly
21 it was a driving factor behind the agreement, was to
22 transition that technology into another company and have
23 it advanced. But there were a variety of other purposes
24 to that agreement, including protecting Novell's
25 interests in making sure that there were provisions that

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1 would enable Novell to receive a portion of an ongoing
2 revenue stream to be compensated for the business.
3 And so I'm with you in terms of, you know, the
4 business motive that triggered the transition was
5 certainly to advance the UnixWare technology, but I can't
6 go as far as saying that that was the entire purpose of
7 that document, the agreement. The agreement also has a
8 fundamental purpose to protect the interests and rights
9 of Novell.
10 Q. Let me rephrase the question. With respect to
11 UnixWare, Novell's entire intent was to transfer the
12 UnixWare business to Santa Cruz, correct?
13 A. Yeah, to the extent consistent with Novell's
14 other interests that would be implicated by the
15 agreement, which I think is -- you know, manifests itself
16 in various places in the document.
17 MR. NORMAND: Your Honor, I would like to play
18 a brief excerpt from Mr. Jones' deposition.
19 THE COURT: Go ahead.
20 (A portion of the deposition was played.)
21 MR. MELAUGH: If I could ask Mr. Normand to
22 state the part in the deposition before your start the
23 clip.
24 MR. NORMAND: All right. Sorry
25 MR. MELAUGH: I don't think you have indicated

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1 it yet, the date and the page number you're referencing.
2 THE COURT: The page number and the line.
3 MR. NORMAND: Yes, Your Honor. I'm sorry.
4 That's Mr. Jones' May 10, 2007, 30(b)(6) deposition, and
5 at page 60 lines 14 to 23.
6 Q. SCO 61 is a two e-mail chain dated December 4,
7 1995, the top e-mail is from David Johnson to, among
8 others, Larry Bouffard. Do you recognize any of those
9 names, Mr. Jones?
10 A. Yes.
11 Q. And do you see the name of Skip Jonas about a
12 third of the way down?
13 A. Yes.
14 Q. Who is Skip Jonas?
15 A. He had a position relating to -- he had a sales
16 position, and I know that at least at one time his
17 responsibilities related to our UNIX business. That's
18 about the extent of my knowledge of Skip Jonas.
19 Q. Do you see this language, Mr. Jones, where
20 Mr. Jonas says, quote:
21 Novell is out of the UNIX/UnixWare business
22 after the closing and does not have the right to sell
23 UnixWare, so if Novell has any inventory of UnixWare
24 after the closing, I believe that Novell has only two
25 choices. Sell it to SCO or destroy it.

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1 Do you see that language?
2 A. Yes.
3 Q. Is that language consistent with your
4 understanding of what happened with the sale of UnixWare
5 under the APA?
6 A. I'm not familiar with this particular issue of
7 the preexisting UnixWare inventory and what was done with
8 it and so forth. At this moment in time, I can't recall
9 that issue.
10 Q. But it is your understanding that Novell was
11 out of the UnixWare business after the APA, correct?
12 A. Yeah. I think, generally-speaking, I would
13 have to say yes. I would like to ask a clarifying
14 question on your earlier question.
15 Q. Of course.
16 A. What do you mean by "UnixWare business?"
17 Q. What's the ambiguity as to what UnixWare
18 business is?
19 A. Well, for example, there were pre-APA versions
20 of SVRX that were UnixWare, and so Novell continued to
21 have a revenue stream associated with those. So, that's
22 why I asked the question, in terms of just: What do you
23 mean by "in the business," because there's still
24 interests there. And so, hence, my question.
25 Q. Is that your only caveat to your view that the

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1 entire UnixWare business had been transferred, as you sit
2 here today?
3 A. Now, that's a different question, the entire
4 UnixWare business having been transferred. Generally, of
5 course, Novell's focus was not going to be UnixWare, and
6 Novell was counting on SCO on moving forward with that.
7 And Novell had some -- it retained rights in terms of
8 copyrights, in terms of royalties that corresponded to
9 UnixWare, you know, and I haven't thought through to
10 delineate every little interest, ongoing interest Novell
11 may have, but I'm with you in terms of: No doubt, the
12 general direction was that UnixWare was moving forward
13 with SCO, and Novell has some ongoing interest in that
14 area, but it's certainly not Novell's focus.
15 Q. You're not suggesting, then, that Santa Cruz
16 was Novell's agent for purposes of UnixWare licenses, are
17 you?
18 A. Well, what do you mean by "UnixWare?" And,
19 again, I just mean, there are -- there were some pre-APA
20 releases of SVRX that were UnixWare, so, with respect to
21 those releases -- and those are identified on the
22 schedule of SVRX licenses. So, only with respect to
23 those versions of UnixWare, I would say that that
24 fiduciary relationship, that collection role applies to
25 those.

347

1 Q. But the right that Novell retained was to
2 continue to receive royalties for certain UnixWare
3 licenses that were in existence?
4 A. Anything that would be an SVRX license that
5 would pertain to the pre-APA release of UnixWare.
6 Q. Your position is that the APA identifies, as a
7 basis for SVRX licenses, certain UnixWare licenses?
8 A. I believe, if we were to take out the Asset
9 Purchase Agreement and look at the schedule that we would
10 see that the last one or two SVRX releases were, in fact,
11 UnixWare. And that's all I'm talking about.
12 Q. And, apart from that retained royalty interest,
13 do you have a view as to whether Novell retained any
14 interest in the UnixWare business after the APA?
15 A. Again, I think I've mentioned that, you know,
16 we would have copyrights associated with anything that
17 was pre-APA. And you said "apart from the royalties,"
18 and so we're not talking about that, you know, and I --
19 so, in my mind, those are the primary things. But as
20 I've told you, this is the last place in the world I
21 would want to sit and attempt to delineate every single
22 aspect of the APA and every possible ongoing interest.
23 And I'm with you in terms of the UnixWare
24 business, in general, is going to SCO, and that's SCO's
25 focus, and it's not Novell's from that point going

348

1 forward.
2 Q. It's not Novell's view that, when SCO was
3 licensing UnixWare with SVRX copyrights therein, it's not
4 Novell's view that SCO had to try to value those
5 copyrights and remit money to Novell, is it?
6 A. So, if you're talking about versions of
7 UnixWare created post-APA and what's being licensed is
8 that version of UnixWare, yes, that is not Novell's
9 position that SCO would have to attempt to, you know,
10 value all the SVRX component parts that make up a part of
11 that UnixWare release.
12 Q. Even though that UnixWare release, in your
13 view, does contain all manner of SVRX code, correct?
14 A. That's right.
15 Q. Now, you're familiar with this language in
16 amendment number 1 to the APA?
17 THE COURT: What is the exhibit?
18 MR. NORMAND: This is SCO 71, Your Honor. I'm
19 sorry.
20 Q. You have seen this language before?
21 A. Yes.
22 Q. Now, I may have misunderstood your testimony,
23 but SCO had the right to enter into new SVRX licenses if
24 it was doing so incidentally through its rights to sell
25 and license UnixWare software, correct?

349

1 A. Right.
2 Q. Now, when you were testifying earlier, I
3 thought you were saying that, in your review of the
4 Microsoft and Sun agreements, that an important fact to
5 you was that it was a new license. Did I mishear you?
6 A. Well, that was an important fact, but it was
7 taken in combination with my belief that the UnixWare
8 activity in the agreement was not -- excuse me -- that
9 the SVRX rights being granted were not merely incidental
10 to the UnixWare portion.
11 So I wasn't -- that was not the only factor. I
12 did highlight that.
13 Q. It doesn't really matter whether the SVRX
14 component of the Sun and Microsoft agreements is a new
15 component for purposes of determining this incidental
16 exception, does it?
17 A. I think it does.
18 Q. How so?
19 A. Well, so, for example, if you go to that
20 licensee and they already have a fully paid-up license
21 for a certain release of SVRX, and then that licensee
22 approaches SCO and licenses UnixWare, and from the
23 license -- that wouldn't be surprising -- licenses
24 UnixWare from SCO and enters an agreement in which
25 UnixWare is identified and then that version of SVRX, for

350

1 which the licensee had fully paid up its license, in that
2 scenario, the fact that -- and, to me, in that scenario,
3 the licensing of UnixWare very likely is incidental to
4 the -- excuse me -- the licensing of the SVRX showing
5 up on the schedule of the new UnixWare agreement, it's,
6 for all purposes, incidental because no new rights are
7 being granted. It's significance there is it's almost
8 meaningless.
9 However, if I took that same version of SVRX
10 and SCO approaches a customer, and SCO enters an
11 agreement with the customer and identifies that same
12 version of UnixWare on the product schedule and then
13 separately that version of SVRX, and that customer has
14 never paid for SVRX before and charges that customer the
15 very same amount for UnixWare, you know, then, to me, I
16 say: Well, now this customer has received substantial
17 additional rights that it did not previously have.
18 Q. It sounds like you've thought about the issue
19 of incidental licensing a bit?
20 A. I've thought about it.
21 Q. But you don't have any view as to whether this
22 language, this incidental language, encompasses a prior
23 practice of licensing older versions of System V with the
24 most recent release, do you?
25 A. Well, my view is, to the extent I have been

351

1 exposed to prior practices, that the theme that I see in
2 them is consistent with the rationale that I just set
3 out.
4 Q. You don't have a view as to whether, in
5 amendment number 1, the parties intended, through the use
6 of that language, to encompass the practice of licensing
7 the prior releases of System V with the most recent
8 release, do you?
9 A. I don't have any knowledge of the people who
10 drafted that language, having -- having spoken and saying
11 that this is why we are putting that language in the
12 agreement. I do not have that type of knowledge.
13 Q. Well, if you have no view on that issue, you
14 can't make a fully-informed assessment of whether
15 incidental licensing has occurred, can you?
16 A. To the contrary. This is an agreement. I
17 think there is an integration clause that says this
18 merges prior discussions and understandings. This
19 agreement, you know, I look at it, and I think that that
20 language has meaning independent of whatever prior
21 discussions took place.
22 Q. Would you acknowledge that it could also be
23 meant to encompass this prior practice, correct?
24 A. What prior practice?
25 Q. The prior practice of licensing older versions

352

1 of System V with the most recent release?
2 A. Well, the prior practice that I described is
3 one in which, for each of those prior releases,
4 consideration had been given. So I don't know if you're
5 talking about the same prior practice, but if that's the
6 prior practice you're alluding to, I could easily see
7 that this would support that type of practice.
8 Q. You don't have a view as to whether it
9 encompasses a practice of licensing releases even to
10 those people who had not previously acquired a
11 stand-alone license to the earlier releases?
12 A. I don't have any knowledge of it being applied
13 to such people.
14 Q. And if this provision was intended to encompass
15 this practice, it would change your analysis, wouldn't
16 it?
17 A. I don't know that it would.
18 Q. So you think the intent of the parties is
19 irrelevant?
20 A. No. But, again, there is -- this is an
21 agreement. I think there is an integration clause.
22 "Incidentally" is a word that appears in the dictionary.
23 It has a meaning.
24 Q. It's ambiguous, isn't it?
25 A. I don't know. I think it calls for application

353

1 to circumstances, but I have been asked about this
2 before, I know, and I said, you know, I'd look at the
3 dictionary, so --
4 THE COURT: Pick a good stopping point.
5 MR. NORMAND: This is fine, Your Honor.
6 THE COURT: Are you sure?
7 MR. NORMAND: Yes.
8 THE COURT: All right. We'll take our second
9 break and be in recess for 15 minutes.
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25 (Short recess.)

354

************************************

Nov-20080430-3.pdf
1 THE COURT: You may proceed, Mr. Normand.
2 MR. NORMAND: Thank you, Your Honor.
3 May I approach, Your Honor?
4 THE COURT: You may.
5 MR. NORMAND: This is a copy of the bulk of the
6 exhibits that we'll be using.
7 THE COURT: Are these all in? Have they all been
8 admitted?
9 MR. NORMAND: With one exception, Your Honor. And
10 when we get to that, I'll offer it.
11 Q. BY MR. NORMAND: Mr. Jones, do you recognize
12 Schedule 1.1(A) to the APA?
13 A. I'm familiar with it. It's not up there right now.
14 I don't have the exhibit to myself.
15 Q. And you referenced the schedule of assets that is
16 in 1.1(A) earlier; correct?
17 A. Correct.
18 Q. And that's in Item 6 of the APA; right?
19 A. Right.
20 Q. And there's no UnixWare release identified in
21 Item 6; correct?
22 A. I'm not certain in that -- my only uncertainty is
23 that I knew the early release of UnixWare was based on
24 Release 4.2. And so I just -- I'm not certain whether that
25 version of 4.2 corresponds to what was in UnixWare release or

355

1 not. That's my only uncertainty.
2 Q. Your view is UNIX System 5 Release 4.2 MP is the
3 same or virtually the same as the first release of UnixWare;
4 correct?
5 A. That's a lot more than I said. I just -- I think
6 that the early version of UnixWare corresponds to 4.2. But
7 sitting here today, I'm just not certain. So if it is the
8 case, then there's UnixWare in the schedule. If it's not the
9 case, then UnixWare is not there.
10 Q. So looking at Item 6 now, you don't think Novell
11 retained any interest in any UnixWare royalties after the APA;
12 correct?
13 A. If none of those identified as SVRX releases are
14 UnixWare, then the SVRX licenses and the corresponding
15 royalties would relate to UnixWare. So it's just a factual
16 question that I have. And that was -- when I was -- earlier
17 when you were asking me about UNIX everything I said was based
18 on whether or not any of these releases are, in fact, a
19 version of UnixWare.
20 Q. But in your view, the place to look to determine
21 what royalties arose is Item 6; correct?
22 A. Yeah, that's right. Item 6 is where there's a
23 reference to that in Section 4.16.
24 Q. You said earlier in your understanding that
25 System V prior products are only licensed when consideration

356

1 was given for the prior products; right?
2 A. I think I said generally. To the extent that I had
3 an opportunity to see examples that that's what I've seen. So
4 that's what I said.
5 Q. You're aware of examples of UNIX licensees who were
6 not charged any price for getting prior products; correct?
7 A. I don't believe I am. I'm not saying that that has
8 never happened. But I don't think I'm aware of any examples.
9 MR. NORMAND: This is SCO Exhibit 369. It may not
10 be in the book, Your Honor, as it turns out.
11 Blow up the top half.
12 Q. BY MR. NORMAND: Do you recognize this document,
13 Mr. Jones? Software agreement for Nihon SCO, Limited;
14 correct?
15 A. I just need to actually read the document here.
16 Yes.
17 Q. Page 10?
18 MR. MELAUGH: Can I ask Mr. Normand to give a copy
19 to the witness? Do you have a copy?
20 THE COURT: Do you have a copy that you can give to
21 him?
22 MR. NORMAND: Somewhere, Your Honor.
23 THE WITNESS: Thank you.
24 MR. NORMAND: Blow up the top half.
25 MR. ERIC WHEELER: Yes, sir.

357

1 Q. BY MR. NORMAND: Mr. Jones, Exhibit A to this
2 document at Page 10 reflects an initial designated CPU price
3 of $375,000; correct?
4 A. Just a second. I'm trying to find it here.
5 Q. It's at Page 10. Do you see Item A, 1A?
6 A. I want to make sure it's the same page. It's kind
7 of clipped at the top.
8 Okay. Right.
9 Q. And if you turn to Page 32, Mr. Jones. There are
10 no prior products listed; correct?
11 A. Page 32?
12 Q. Correct.
13 A. I'm really thrown by the numbering.
14 Q. Do you not see this on the screen? Do you want me
15 to blow it up?
16 A. Well, I'd like to be able to see it in context.
17 And you're referring to page 32. I'm simply not tracking on
18 the pages.
19 Q. Bates number is 1042612.
20 A. Okay.
21 Q. So for this supplement, the initial CPU price is
22 $375,000, and there are no prior products listed; correct?
23 A. There are no prior products in this exhibit. I've
24 never seen this agreement before. I'm not familiar with the
25 way it's organized. So all I can really say is I know this

358

1 exhibit says that, but I'm not familiar with the agreement.
2 Q. Okay.
3 May I approach, Your Honor?
4 THE COURT: You may. What exhibit are you talking
5 about?
6 MR. NORMAND: SCO 370.
7 Q. BY MR. NORMAND: SCO 370 is a UNIX agreement
8 concerning UNISYS; correct?
9 A. Yes.
10 Q. Do you see at Page 4 which is --
11 A. I think the Bate stamp number would help.
12 Q. It's easier?
13 A. Yeah.
14 Q. Bates 1039897.
15 A. Okay.
16 Q. In Section 1A, the initial designated CPU price is
17 $375,000; correct?
18 A. Correct.
19 Q. If you turn to Bates 1039921. A lengthy list of
20 prior products; correct?
21 A. Right. There is a list, right.
22 Q. So these two documents reflect the same initial per
23 CPU price for UnixWare licenses whether or not the prior
24 products are listed; correct?
25 A. Again, I'm not familiar with the documents. I can

359

1 simply say that that information appears on the two pages that
2 we saw in each agreement. I have never studied this document.
3 I'm not familiar with the way it's organized and how it works.
4 Q. Well, having seen what I've shown you, it's clear
5 that --
6 MR. MALAUGH: Mr. Normand, is this a demonstrative
7 that you intend to use?
8 We have a stipulation such that demonstratives that
9 are going to be used with witnesses must be disclosed 24 hours
10 in advance.
11 MR. NORMAND: This is from the opening.
12 THE COURT: It's from what?
13 MR. NORMAND: The opening argument that Mr. Singer
14 did, Your Honor.
15 MR. SINGER: I used those two in my opening.
16 THE COURT: I thought he did.
17 MR. MALAUGH: I think our understanding of the
18 agreement was that if someone was going to use something with
19 the witness, we would be told it was going to be used with the
20 witness.
21 MR. NORMAND: I don't need to use it, Your Honor.
22 But I do have a different understanding of the meaning of the
23 stipulation.
24 THE COURT: Well, I don't have any understanding of
25 the meaning of that yet. So apparently you two have a

360

1 different ones. But now it's not relevant; right.
2 MR. NORMAND: I'll ask Mr. Jones a question without
3 using the exhibits.
4 THE COURT: All right.
5 Q. BY MR. NORMAND: Based on what I've shown you on
6 these two licenses, the same per CPU price per unit where a
7 license was charged whether or not the system prior products
8 was listed; correct?
9 A. The same price was listed on the page whether or
10 not the exhibit identified a product or not. And that's all I
11 can say, is those words appear. And I haven't studied the
12 agreements, so I don't know how they work.
13 Q. You are a lawyer; right?
14 A. I think lawyers actually need to read documents to
15 understand them, nonetheless.
16 Q. I understand.
17 Now, in your view, one needs the details in the
18 transaction at issue to determine whether there is an
19 incidental licensing that's SVRX with UnixWare; correct?
20 A. I'm sorry. Could you say that again?
21 Q. In your view, one needs to understand the details
22 of the transaction at issue to determine whether there has
23 been incidental licensing of any SVRX with UnixWare; correct?
24 A. Once you understand the circumstances of the
25 transaction.

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1 Q. Now, on the issue of whether any SVRX source code
2 was licensed incidentally to UnixWare in Microsoft agreement,
3 you think Microsoft views are irrelevant?
4 A. As to SVRX agreement, yes.
5 Q. And as to whether there's been any incidental
6 licensing; correct?
7 A. Yes.
8 Q. And the same is true as to Sun's view in its
9 agreement as to whether there's been incidental licensing;
10 correct?
11 A. Yes.
12 Q. But you do think the overall facts and
13 circumstances surrounding the transaction are relevant;
14 correct?
15 A. Well, the circumstances of the transaction -- yeah,
16 to some extent that needs to be understood.
17 Q. To a significant extent; correct?
18 A. Yes.
19 Q. And primarily, you think the actual terms of the
20 agreements are the most important to determining whether there
21 has been incidental licensing; correct?
22 A. Not necessarily. I mean, the terms -- the terms of
23 an agreement might not fully reflect the circumstances behind
24 the transaction.
25 MR. NORMAND: Your Honor, may I play a clip from

362

1 Mr. Jones' deposition?
2 THE COURT: Yes. Tell us.
3 MR. NORMAND: May 10, 2007; Page 246 Line 16 to
4 Page 247 Line 1.
5 THE COURT: Thank you.
6 MR. MALAUGH: It was May 10th? Thanks.
7 MR. NORMAND: If that's not going to work, I can
8 read it, Your Honor.
9 THE COURT: Is it not going to work? All we're
10 getting so far is it a sounds like someone backing up.
11 MR. ERIC WHEELER: That is the audio, Your Honor.
12 THE COURT: If you can read it if you can't get it
13 to work.
14 Q. BY MR. NORMAND: Mr. Jones, I asked the following
15 question, and you gave the following answer:
16 Question. So in Novell's view --
17 MR. MELAUGH: Can I ask -- I'm sorry I'm having
18 difficulties, but could you give him a copy of the transcript
19 to Mr. Jones so he can follow along with you?
20 MR. NORMAND: May I approach, Your Honor?
21 THE COURT: Oh, yes. Yes.
22 Q. BY MR. NORMAND: This is at Page 246 Line 16:
23 Question. So in Novell's view whether the
24 UnixWare had been licensed or whether the SVRX had
25 been licensed incidentally with UnixWare is

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1 something to be determined from the terms of the
2 agreements; is that right?
3 Answer. Well, as I said, I think terms of
4 the agreement would be the most important
5 consideration. And my response is I think I
6 suggested the overall facts and circumstances, and
7 those facts and circumstances I think are probably
8 the most important thing in the terms.
9 Do you recall being asked that question and giving
10 that answer?
11 A. Vaguely. But here it is, so....
12 Q. Now, beginning in October of 2002, you had several
13 communications with SCO; right?
14 A. Yes.
15 Q. And there were in your best estimate four to six
16 conversations between Novell and SCO during that time?
17 A. Something like that. I don't know.
18 Q. And to your recollection, in October of 2002,
19 Mr. McBride told that you SCO was starting to look into the
20 possibility of Linux end users using UNIX code; correct?
21 A. Yes.
22 MR. NORMAND: Will you pull up SCO 398?
23 MR. ERIC WHEELER: Yes, sir.
24 Q. BY MR. NORMAND: And in this e-mail, in the fall of
25 2002, you refer to that earlier conversation with Mr. McBride;

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1 correct?
2 THE COURT: This is SCO 390?
3 MR. NORMAND: Yes, Your Honor -- 398.
4 THE COURT: Pardon me?
5 MR. NORMAND: 398.
6 MR. MELAUGH: And again, Your Honor, if I could ask
7 counsel to follow the general practice and give the witness a
8 copy of the exhibit that he's referring to so that the witness
9 can see the context of what you're blowing up.
10 Q. BY MR. NORMAND: Mr. Jones, do you need a copy of
11 this exhibit to understand this question?
12 A. Not this one. But in general I really appreciate
13 having the exhibits.
14 Q. Of course.
15 And you recall in this document that a few weeks
16 earlier on November 15th --
17 A. I actually didn't answer your question. But you
18 had asked me the question about --
19 Q. Do you think this e-mail reflects your discussions
20 with Mr. McBride?
21 A. Yes.
22 Q. This is an e-mail from November 15th, 2002;
23 correct?
24 A. Right.
25 Q. And you recall that a few weeks earlier on that

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1 date, Mr. McBride, quote:
2 Expressed interest in pursuing Linux users
3 who may be using misappropriated UNIX code. End quote.
4 Right?
5 A. Right.
6 Q. This is SCO 397, e-mail dated November 20th, 2002,
7 from yourself. And in this e-mail you described a
8 conversation with Mr. McBride that you and Dave Wright had
9 that same day; correct?
10 A. Just a second.
11 (Time lapse.)
12 THE WITNESS: Yes.
13 Q. BY MR. NORMAND: You recount the possible efforts
14 by SCO to assert claims relating to infringing uses of SCO's
15 UNIX libraries by end users of Linux; correct?
16 A. Right.
17 MR. NORMAND: 399.
18 Q. BY MR. NORMAND: To some extent you may be able to
19 find it. It's tabbed.
20 A. Okay. Thanks.
21 Q. We're on 399 now.
22 I'm told we may need some time technically to be
23 able to use the documents this way, which I think is faster.
24 But I defer to how Your Honor wants to proceed. It may take
25 us three to four minutes.

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1 THE COURT: To get this up and running?
2 MR. NORMAND: Yes, sir.
3 THE COURT: Well, we better wait. I think it
4 ultimately would be quicker.
5 MR. NORMAND: I agree, Your Honor.
6 (Time lapse).
7 THE COURT: There are no -- there are no interlude
8 non-exhibit questions you could ask? If there aren't, there
9 aren't.
10 MR. NORMAND: I'm sort of in the middle of this
11 topic.
12 (Time lapse.)
13 Q. BY MR. NORMAND: There is a discrete area that we
14 can turn to, Mr. Jones, if you're comfortable with that. We
15 can go back to this.
16 A. Yes.
17 Q. You spoke about the Solaris files with counsel in
18 your direct examination. Do you remember that?
19 A. Yes.
20 Q. Exhibits 439 to 59?
21 A. It sounds right.
22 Q. Do you know what functions these files perform in
23 Solaris?
24 A. I didn't. No. I didn't attempt to understand what
25 their functionality was.

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1 Q. Do you know what function these files performed,
2 SVR4-389?
3 A. No. In neither case did I look at them to what
4 their functionality was.
5 Q. Do you know if the files originated in SVR4-386?
6 A. Meaning that the first version in which they
7 appeared?
8 Q. Yes.
9 A. I don't know.
10 Q. You said that Novell had a hard copy of SVR4-386;
11 correct?
12 A. A hard copy?
13 Q. A hard copy of the source code?
14 A. If I said that I'm mistaken. We have SVRX source
15 code. But if you understood me to say that we have hard
16 copies of it, I didn't intend to say that. That would be a
17 huge printout.
18 Q. I didn't mean to say you printed it out. I mean
19 you have access to the actual source code?
20 A. Okay. I understood you to mean by hard copy we had
21 a printout of the system.
22 Q. No. Why did Novell have the source code of the
23 SVR4-386?
24 A. I don't know why we wouldn't.
25 Q. Novell transferred all copies of its source code

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1 for UNIX and UnixWare to Santa Cruz in 1995; correct?
2 A. There is a license of technology back to Novell.
3 The technology license agreement. It was contemporaneous with
4 the asset purchase agreement. So -- there are certain bounds
5 on the license, but we're perfectly entitled to have copies of
6 the pre APA SVRX according to the terms of that license
7 agreement.
8 Q. Now you identified 21 OpenSolaris filings that you
9 found; correct?
10 A. Yeah. There were 21 that we talked about today.
11 Q. And all of those files are in UnixWare 1; correct?
12 A. I don't know whether they're in UnixWare 1.
13 Q. You did not look at that, did you?
14 A. I did not look at that.
15 Q. Now, you testified, Mr. Jones, your views as to
16 what money Novell is entitled to under the Sun agreement in
17 2003. Do you recall that?
18 A. Yes.
19 Q. And you said you didn't think that the 2003 Sun
20 agreement was a customarily license agreement. Do you recall
21 that?
22 A. I think I said -- I can't recall -- that may have
23 been the question. I think what I said it was extraordinary.
24 I can't recall if I said, used the words, it's not customary.
25 But I do recall using the word extraordinary.

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1 Q. The 1994 Sun agreement was extraordinary, as well,
2 wasn't it?
3 A. Yeah. I'd say it's not a typical agreement. It's
4 a buyout of source code rights. Buyout, excuse me, of source
5 code royalty obligations.
6 Q. Now, Novell seeks all 10 million that was paid for
7 the 2003 Sun agreement?
8 A. Yes.
9 Q. The 2003 Sun agreement does provide some broad
10 rights with respect to UnixWare; correct?
11 A. Yes.
12 Q. And you asses no value to that UnixWare license;
13 correct?
14 A. No. As I stated, there has been no value specific
15 to the UnixWare portion suggested by SCO. And given the
16 relationship between Novell and SCO in this regard and SCO
17 being the fiduciary and no value being, having been assigned
18 by SCO, I conclude that we're entitled to all of it.
19 Q. So your view is the only reason that Novell is
20 entitled to all of it is because SCO hasn't suggested an
21 apportionment?
22 A. Well, I don't think that -- you know, there would
23 have to be some legitimate apportionment established, and one
24 has not even been suggested.
25 Q. But your view is the most important thing to look

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1 at to determine whether there's been incidental licensing is
2 in terms of the agreement; correct?
3 A. Well, let me see here. I mean, obviously what
4 we've talked about is the facts and circumstances and the
5 terms and conditions both mattering, having to look at all of
6 it. And so in my deposition you asked me the question, I said
7 one was more important than the other, and today I said the
8 other is more important. They're both important. They're all
9 important in understanding the agreement. I don't truly know
10 that gets us anywhere by trying to say one is more important
11 than the other. But the circumstances, the facts and
12 circumstances, the terms, all of those need to be considered.
13 Q. One can't reasonably review the 2003 Sun agreement
14 and conclude that no money was paid for the broad UnixWare
15 license; correct?
16 A. I don't think one can conclude that the monies paid
17 were not to some extent in consideration with the UnixWare
18 related rights. But I have no way of knowing how much of it
19 was for that.
20 Q. Your view is SCO should forfeit whatever money it
21 might be entitled to because it hasn't suggested a specific
22 apportionment; right?
23 A. In light of the fiduciary relationship that exists
24 between the parties and the fact that SCO executed this
25 without Novell's approval and involvement and SCO has not been

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1 forthcoming with some suggestion as to what the value should
2 be for the UnixWare portion, yes.
3 Q. You think SCO should forfeit the money?
4 A. Well --
5 Q. You just said yes.
6 A. Well, then --
7 Q. So that's your answer.
8 A. Well, I guess forfeit the money is a
9 characterization.
10 Q. You're an attorney. I've asked you a question.
11 What's your view? Is it forfeiture?
12 A. What my view is is that there's no reason Novell
13 should forfeit any of the monies itself given the position
14 that Novell is in, given that Novell was excluded.
15 Q. That begs the question, doesn't it? We were here
16 to determine who gets what, what the relative value is of this
17 license.
18 A. Absolutely. And, of course, as I've expressed and
19 you certainly are going to disagree with me, that from my
20 perspective, given the fiduciary relationship and all the
21 factors that I've described, that if there's a party that's at
22 risk of forfeiting or foregoing some consideration as between
23 Novell and SCO, it should be SCO.
24 Q. Section 3 of the Microsoft agreement is the
25 UnixWare license; correct?

372

1 A. Yes.
2 Q. It was $7 million worth of the UnixWare license;
3 correct?
4 A. You know, I just know there's money there. I have
5 not memorized the payment amounts for each section of that
6 agreement.
7 Q. The Sun UnixWare license is broader than the
8 Microsoft UnixWare license, isn't it?
9 A. I haven't looked at the two in those terms.
10 Q. Well, you testified at some length in your direct
11 examination about how much thought you've put into this. The
12 Section 3 Microsoft license is narrower than -- Section 3
13 license of Microsoft UnixWare is narrower than Sun's UnixWare
14 license; correct?
15 A. Is the question whether I said that before or
16 whether that's a fact?
17 Q. No. I'm asking you a yes or no question right now.
18 A. Right now. Well, the elements of a license in its
19 breath I think are the technology that are licensed and the
20 rights that are conferred. And the rights that are conferred
21 in the Sun agreement I can't imagine more expansive rights
22 than those. I haven't looked at the Sun agreement and the
23 Microsoft agreement side by side to see if there's any
24 meaningful distinction in the technologies that are
25 identified. So I simply haven't looked at the agreement from

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1 that perspective. I haven't thought of it that way.
2 Q. You're not able as you sit here to compare the
3 scopes of the UnixWare license of Microsoft 2003 to the scope
4 of the UnixWare of Sun in 2003; that's your testimony?
5 A. Are you asking me to do that now?
6 Q. I'm asking you --
7 A. I have not done it before.
8 Q. How could you not have done that and apportion any
9 value to the Sun license?
10 A. For the reasons that I've stated before.
11 Q. The UnixWare license in the Sun agreement is worth
12 at least $7 million, isn't it? Wouldn't it follow from the
13 act of the Section 3 UnixWare license in Microsoft was for
14 $7 million?
15 A. I have not, you know, come here today having
16 attempted to made any specific valuations, just as SCO has not
17 offered any specific valuations. And my position as between
18 Novell and SCO is it's incumbent on SCO to do that. And if
19 they haven't done it, then they're the ones that should bear
20 the risk of foregoing consideration.
21 Q. But you concede that if you're wrong about that
22 point, if you're wrong about that burden that you think
23 applies to SCO, then there is value to the UnixWare components
24 in the Sun agreement. That is your view, isn't it?
25 A. Can you say that again?

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1 Q. If you're wrong about your argument that SCO should
2 forfeit the value of any UnixWare license in the Sun
3 agreement, if you're wrong about that, there is value to the
4 UnixWare Sun agreement, isn't there?
5 A. I don't understand what you're saying. There's
6 value to the UnixWare --
7 Q. Are you suggesting that Sun take no money, no
8 consideration for the broad UnixWare license it received in
9 2003?
10 A. I'm just confused because the whole agreement
11 characterizes the UnixWare agreement. And you're specifying
12 the UnixWare portions?
13 Q. I understand Novell's position to be that there's
14 at least a broad UnixWare license in the Sun agreement. I
15 understand that Novell takes the position, that there's more
16 than that as well. And SVRX components. Are we on the same
17 page?
18 A. No. Where I got disconnected from you is that you
19 said that the Sun UnixWare license. And what I've heard SCO
20 do is it characterize the entire agreement as a UnixWare
21 license. And you just asked me if there's value associated
22 with it. And I think, well, yeah, Sun paid for it. So I
23 wasn't sure if you were asking about the entire agreement.
24 Q. I'm asking just about what you regard as the
25 UnixWare portion.

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1 A. The UnixWare portion? Yeah. I've never said --
2 I'm drawing some conclusion that there's no value in the
3 UnixWare related rights that are conferred. But the question
4 is, how do you establish some valuation for apportionment
5 purposes? And SCO has not provided anything on that. And
6 again, under those circumstances, I feel Novell's entitled to
7 conclude that that money should be Novell's, and Novell should
8 not be required to forfeit something here.
9 Q. Your view that Novell gets all the money, the
10 10 million, is based on a legal argument; correct?
11 A. Well, it's based on -- legal arguments don't exist
12 in a vacuum. It's based on the factual circumstances and the
13 legal arguments arising out of the fiduciary relationship that
14 exists between the two parties.
15 Q. Your view that Novell gets everything is not based
16 on an objective assessment of what was paid for the rights in
17 the 2003 Sun agreement, is it?
18 A. It's not -- it does not reflect any type of
19 economic valuation or analysis or anything of that nature.
20 Q. I want to turn back to your discussions with SCO in
21 the fall of 2002.
22 A. Okay.
23 Q. I won't be much longer.
24 Exhibit 400, Mr. Jones. It should be in that book.
25 THE COURT: This is SCO 400?

376

1 MR. NORMAND: Yes, Your Honor.
2 THE WITNESS: Yes. I've got it.
3 Q. BY MR. NORMAND: Now, at the time of these
4 discussions with Mr. McBride, Novell had no interest
5 whatsoever in supporting any UNIX infringement claims against
6 end users of Linux; correct?
7 A. Yes. I think that's correct. And that's what our
8 executives advised me.
9 Q. Novell's efforts were prioritized in other places;
10 correct?
11 A. Well -- I guess I just say yes, just by virtue of
12 the fact that this didn't have priority. So....
13 Q. Now, at the time of these discussions Novell was
14 fully moving in the direction of being involved in Linux;
15 correct?
16 A. That's correct.
17 Q. And you didn't say that to SCO in these
18 discussions; correct?
19 A. No. I mean, to me I think we had acquired Zimeon
20 at that point, which is the Linux desktop company. So that
21 was public knowledge. And any other information that I had
22 about Novell's investigations would have been confidential, so
23 no.
24 Q. You didn't raise any objections with respect to the
25 perspective licenses that Darl had mentioned; correct?

377

1 A. I did not understand the licenses that would be
2 granted.
3 Q. You understood --
4 A. Darl, he came to me requesting help with due
5 diligence and assessing what SCO's rights would be. I
6 confided that once they understood what their rights would be,
7 they would act accordingly. So not having known the terms
8 that would have been offered to people in any such program or
9 any agreement and also just understanding that SCO seemed to
10 be investigating intellectual property rights to understand
11 the bounds what they might properly do, I don't think there
12 was any need for me -- I don't know what I would have objected
13 to.
14 Q. He specifically told you that they were concerned
15 about the use of UNIX code and use of UNIX code by Linux end
16 users; correct?
17 A. That's right.
18 Q. What did you understand UNIX code to be?
19 A. At that point I wouldn't know.
20 Q. Didn't think about it?
21 A. There wouldn't be -- as has been discussed, there
22 is a wide variety of UNIX code that's been developed over the
23 years. So how would I know what specific code he would be
24 discussing? He did mention -- the one specific thing that
25 Darl mentioned was the library. But I couldn't understand,

378

1 you know, in the vast scheme of things, you know, where that
2 would factor in or under what terms it would be offered or --
3 you know, my information was very scant.
4 Q. But you knew it concerned Linux and UNIX; correct?
5 A. That I knew.
6 Q. And Novell's position is that it retained
7 substantial rights in the UNIX business; correct?
8 A. We have substantial rights in pre-APA SVRX. UNIX
9 would be a pre-APA SVRX as a subset of UNIX. So when someone
10 says they're going to do something with UNIX, I cannot know if
11 they're taking about something that would implicate Novell's
12 interest or not.
13 Q. And you understood SCO to be contemplating a
14 program on its own; correct?
15 A. Yes. On its own -- well, what do you mean by, on
16 its own?
17 Q. You understood that SCO was interested in pursuing
18 its own efforts against Linux end users; correct?
19 A. Yeah. I guess I just need not to jump to a
20 conclusion here. They were asking for Novell's cooperation
21 and assistance to the extent of helping them identify
22 documents or due diligence purpose and things of that nature.
23 And, of course, they had questions about the terms of the
24 earlier agreements. And whether or not they had any
25 involvement with third parties was something I had no

379

1 knowledge of. So I was hasty to say they were going alone.
2 That was what I just described was the extent of the knowledge
3 that I had.
4 Q. You're not suggesting that Mr. McBride had asked
5 you to be a business partner in pursuing these Linux end
6 users, are you?
7 A. What do you mean by business partner?
8 Q. It was SCO's effort and they were asking for due
9 diligence support from Novell; right?
10 A. Yeah. The nature of the cooperation, and, you
11 know, partnering covers a wide variety of activities. So
12 Mr. McBride suggested, as he explained earlier here today, you
13 know, hey, Novell, if you help support us in some way, what we
14 intend to do that could have some business benefit to you.
15 And so, Novell, what we want of you is to help us do due
16 diligence. We think that will help support our efforts.
17 So is that partnering? I think that's some form of
18 partnering. But that's the extent of what Mr. McBride
19 explained to me. He didn't explain something beyond that to
20 me or suggest something beyond that.
21 Q. This is Exhibit SCO 87, Your Honor.
22 THE COURT: Okay.
23 Q. BY MR. NORMAND: Mr. Jones, I want to go back to a
24 couple of letters that we discussed. In 1996, you were
25 employed by Novell; correct?

380

1 A. Yes.
2 Q. Now, in 1996, Novell informed its customers and
3 business partners that Novell had transferred its existing
4 ownership interest in all releases of UNIX and UnixWare to
5 Santa Cruz; correct?
6 A. Could you say that again? I was looking at the
7 document, and you were speaking.
8 Q. I said in 1996 Novell represented to its customers
9 and business partners that it had transferred its existing
10 ownership interest in all releases of UNIX and UnixWare to
11 Santa Cruz; correct?
12 This paragraph that is Attachment A. You can go to
13 Attachment A.
14 A. I guess the only liberty -- I mean, this letter was
15 sent. I simply don't have the personal knowledge of how
16 extensively it was sent, but I think you said its customers.
17 So I don't know how many -- I just don't know how many
18 customers received it. But this letter does reference in this
19 exhibit all releases of UNIX System V and prior releases of
20 the UNIX system. And the letter would be inconsistent, of
21 course, with the asset purchase agreement.
22 Q. But Novell did make these representations to
23 Prentice-Hall; correct?
24 A. It's sent -- well, you know, again, I assume
25 Prentice-Hall received it, Novell wrote this in a letter to

381

1 Prentice-Hall by an Novell employee.
2 Q. Novell said that it was assigning its right under
3 its agreements that concerned those releases; correct?
4 A. If this letter says that, it's inconsistent with
5 the asset purchase agreement.
6 Q. Let's go to Exhibit 411.
7 THE COURT: SCO 411?
8 MR. NORMAND: Yes, Your Honor.
9 Q. BY MR. NORMAND: This is a letter from Mike DeFazio
10 to SunSoft. Do you know what SunSoft is?
11 A. I thought it was a software division of Sun.
12 Q. You're correct.
13 A. Okay.
14 Q. And Novell specifically told Sun that Novell had
15 transferred its existing ownership interest and all releases
16 of UNIX and UnixWare; correct?
17 A. This letter says that, and it's inconsistent with
18 the APA.
19 Q. Who signed this letter?
20 A. Michael J. DeFazio.
21 Q. What was his position?
22 A. I don't know his precise title, but he was -- I
23 know he had significant responsibilities for Novell's UNIX
24 business. You know, I regard him as having headed it up,
25 really, at certain points in time.

382

1 Q. Was he head of the organization within AT&T and USL
2 and later Novell responsible for product management, marketing
3 and licensing terms and conditions for UNIX from 1984 to 1995?
4 A. I don't know what you're reading. It sounds
5 plausible. It's obvious I don't come in here with that
6 specific knowledge in my mind. But that sounds plausible.
7 Q. But you think he was wrong about what he said?
8 A. Yes.
9 MR. NORMAND: SCO 136.
10 Q. BY MR. NORMAND: There is a SCO -- what number is
11 this?
12 MR. ERIC WHEELER: 136.
13 MR. NORMAND: 136, Your Honor.
14 Q. BY MR. NORMAND: This is a similar letter to
15 Microsoft; correct?
16 A. Just a second.
17 MR. NORMAND:
18 Your Honor, I don't think there's a stipulation as
19 to this document, so I move for its admission.
20 THE COURT: 136.
21 MR. MELAUGH: No objection.
22 THE COURT: Well, it's on the list, isn't it?
23 THE CLERK: It is not on the list.
24 THE COURT: 136. It's on my list.
25 SCO Exhibit 136.

383

1 THE CLERK: I don't have a 136 on mine, on my list.
2 THE COURT: Well, I'll admit it. It's on my list.
3 (Whereupon, SCO 136 was received.)
4 MR. NORMAND: Thank you, Your Honor. We'll cure
5 the confusion.
6 Q. BY MR. NORMAND: Now, in these letters, Mr. Jones,
7 Novell was telling people to deal directly with Santa Cruz;
8 correct?
9 A. I've been reading the other part of the letter. So
10 just a second.
11 (Time lapse.)
12 Q. BY MR. NORMAND: Have you had a chance to review
13 the document?
14 A. Yes. Yes. It's consistent with what you said.
15 These are -- it's informing the parties that the contracts
16 have been assigned to SCO. So in effect that they should, you
17 know, they should be dealing with SCO then.
18 Q. And Novell told Sun and Microsoft that; is that
19 correct?
20 A. SunSoft and Microsoft.
21 Q. My colleagues remind me that when we went down with
22 the system, I was on one of your e-mails.
23 A. Okay.
24 Q. Your infamous e-mails.
25 A. Infamous.

384

1 MR. NORMAND: This is still 399, Your Honor.
2 Q. BY MR. NORMAND: Do you have that e-mail in front
3 of you, Mr. Jones?
4 A. Hang on just a second. Tab -- this is Exhibit --
5 yeah, I've got this.
6 THE COURT: SCO 399.
7 THE WITNESS: Right. Thanks.
8 Q. BY MR. NORMAND: Let me know when you've had a
9 chance to review it.
10 A. Okay.
11 (Time lapse.)
12 THE WITNESS: Okay.
13 Q. BY MR. NORMAND: Thank you, Mr. Jones.
14 You said on December 4th, 2002, that you and Mr.
15 Wright had returned a phone call from Mr. McBride; correct?
16 A. Yes.
17 Q. And you said that Darl reiterated his request from
18 Novell's assistance, and then he informed us that next week
19 SCO will announce a Linux licensing program; correct?
20 A. Correct.
21 Q. That's an accurate statement; correct?
22 A. I believe so.
23 Q. In your review of this document, have you had seen
24 any statements that you made that you think are inaccurate?
25 A. That I made that are inaccurate?

385

1 Q. Correct.
2 A. I think the only thing I might take issue with is
3 my poor writing in the second sentence of the fourth paragraph
4 where I talk about potential increase of the declining
5 $8 million revenue stream.
6 Q. But the rest of your statements in the e-mail you
7 believe are accurate?
8 A. Yeah. And I think, as Mr. McBride was saying, I
9 think he was just suggesting that the decline would slow, not
10 that there would be some substantial increase or something of
11 that nature.
12 MR. NORMAND: May I approach, Your Honor?
13 THE COURT: Yes.
14 Q. BY MR. NORMAND: I hand you two last documents,
15 Mr. Jones.
16 A. Okay.
17 Q. These are Novell 468 and 469. This is a Novell
18 letter to Microsoft from September of 2007; correct?
19 A. Well, there are two letters. I'm sorry. We were
20 on --
21 Q. I'm sorry. I'm on 468.
22 A. Okay.
23 Q. And 469 is a letter to Sun.
24 A. Yeah.
25 Q. And the content of the letter is the same; correct?

386

1 A. I don't know.
2 Q. Let's do 468.
3 A. Okay.
4 Q. Have you seen this letter before?
5 A. I think I have. I've seen so many documents. But
6 I believe I've seen it.
7 Q. In this letter, Mr. LaSala, who was general counsel
8 at the time; correct?
9 A. Yes.
10 Q. Tells Microsoft, quote:
11 We believe that the 2003 agreement is
12 unenforceable, void or invalid, and hence that
13 there may be copyright issues arising out of
14 Microsoft's use of UNIX or UnixWare code in which
15 Novell retains copyright ownership.
16 Do you see that line?
17 A. Yes.
18 Q. Does that statement reflect Novell's position
19 today, as well?
20 A. Yes.
21 Q. Exhibit 469 is a letter to Sun. And it contains in
22 bottom third of the letter the same statement; correct?
23 A. I think they're not quite identical. But you're
24 asking if that still reflects Novell's position? That's the
25 question?

387

1 Q. Right.
2 A. I believe so.
3 MR. NORMAND: Nothing further, Your Honor.
4 THE COURT: Pardon me?
5 MR. NORMAND: Nothing further.
6 THE COURT: Thank you, Mr. Normand.
7 Anything else, Mr. Melaugh?
8 MR. MELAUGH: Your Honor, we have no further
9 questions of this witness.
10 THE COURT: Thank you, Mr. Jones. You may call
11 your next witness.
12 MR. JACOBS: Your Honor, we have no further
13 witnesses. We have a couple of exhibits to move into
14 evidence. And we would request the opportunity to just check
15 this evening against the exhibits that we looked at to make
16 sure that they were either part of the stipulation or we moved
17 them into evidence.
18 THE COURT: What exhibits are you talking about?
19 MR. JACOBS: So 430, Novell Exhibit 430 is the
20 letter to the Arbitral Tribunal in which SCO stated that it
21 had no further claims after this Court's copyright decision.
22 THE COURT: This is Novell 430.
23 MR. JACOBS: Correct.
24 THE COURT: Any objection?
25 MR. SINGER: No objection.

388

1 THE COURT: 430 is received.
2 (Whereupon, Novell Exhibit 430 was received.)
3 MR. JACOBS: And Novell Exhibits 468 and 469 are
4 the two exhibits that you just saw in the examination of
5 Mr. Jones. The letters from last September to Microsoft and
6 Sun.
7 THE COURT: You want them in twice?
8 MR. JACOBS: No. He did not move them into
9 evidence.
10 THE COURT: Didn't he? I thought he did.
11 MR. NORMAND: I missed the reference to the
12 exhibits number. I'm sorry.
13 THE COURT: It's SCO.
14 MR. JACOBS: No. I believe it's Novell.
15 THE COURT: Novell 468 and 469.
16 MR. NORMAND: I would like to move them into
17 evidence. Thank you.
18 THE COURT: I thought you would. 468 and 469 are
19 received.
20 (Whereupon, Novell Exhibits 468 and 469 were received.)
21 MR. JACOBS: And then if we may, Your Honor, just
22 check, we don't know of anything we left out. But we would
23 like to check this evening on whether there were any further
24 exhibits.
25 THE COURT: We'll check at the end of the trial, as

389

1 well, for both of you. All right.
2 MR. JACOBS: Otherwise we rest, Your Honor.
3 THE COURT: Thank you.
4 MR. SINGER: Your Honor, we would like to move at
5 this time for an involuntary dismissal of these claims. I'm
6 not going to ask to argue at this time, but argument on a
7 certain basis later today. But we simply would like to do so
8 on the basis of all the papers that have been submitted
9 including arguments in our trial brief and proposed findings.
10 THE COURT: All right. And I'll take those motions
11 under advisement.


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