6604 1 IN THE IOWA DISTRICT COURT FOR POLK COUNTY ----------------------------------------------- 2 JOE COMES; RILEY PAINT, ) 3 INC., an Iowa Corporation;) SKEFFINGTON'S FORMAL ) 4 WEAR OF IOWA, INC., an ) NO. CL82311 Iowa Corporation; and ) 5 PATRICIA ANNE LARSEN; ) ) TRANSCRIPT OF 6 Plaintiffs, ) PROCEEDINGS ) VOLUME XXV 7 vs. ) ) 8 MICROSOFT CORPORATION, ) a Washington Corporation, ) 9 ) Defendant. ) 10 ----------------------------------------------- 11 The above-entitled matter came on for 12 trial before the Honorable Scott D. Rosenberg 13 and a jury commencing at 8:30 a.m., January 5, 14 2007, in Room 302 of the Polk County 15 Courthouse, Des Moines, Iowa. 16 17 18 19 20 HUNEY-VAUGHN COURT REPORTERS, LTD. 21 Suite 307, 604 Locust Street 22 Des Moines, Iowa 50309 23 (515)288-4910 24 25 6605 1 A P P E A R A N C E S 2 Plaintiffs by: ROXANNE BARTON CONLIN 3 Attorney at Law Roxanne Conlin & Associates, PC 4 Suite 600 319 Seventh Street 5 Des Moines, IA 50309 (515) 283-1111 6 RICHARD M. HAGSTROM 7 MICHAEL E. JACOBS Attorneys at Law 8 Zelle, Hofmann, Voelbel, Mason & Gette, LLP 9 500 Washington Avenue South Suite 4000 10 Minneapolis, MN 55415 (612) 339-2020 11 STEVEN A. LAMB 12 Attorney at Law Zelle, Hofmann, Voelbel, 13 Mason & Gette, LLP 550 South Hope Street 14 Suite 1600 Los Angeles, CA 90071 15 (213) 895-4150 16 KENT WILLIAMS Attorney at Law 17 Williams Law Firm 1632 Homestead Trail 18 Long Lake, MN 55356 (612) 940-4452 19 20 21 22 23 24 25 6606 1 Defendant by: DAVID B. TULCHIN 2 STEVEN L. HOLLEY SHARON L. NELLES 3 Attorneys at Law Sullivan & Cromwell, LLP 4 125 Broad Street New York, NY 10004-2498 5 (212) 558-3749 6 ROBERT A. ROSENFELD KIT A. PIERSON 7 Attorneys at Law Heller Ehrman, LLP 8 333 Bush Street San Francisco, CA 94104 9 (415) 772-6000 10 BRENT B. GREEN Attorney at Law 11 Duncan, Green, Brown & Langeness, PC 12 Suite 380 400 Locust Street 13 Des Moines, IA 50309 (515) 288-6440 14 15 16 17 18 19 20 21 22 23 24 25 6607 1 STEVEN J. AESCHBACHER Attorney at Law 2 Microsoft Corporation One Microsoft Way 3 Redmond, CA 98052 (425) 882-8080 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 6608 1 (The following record was made out of 2 the presence of the jury at 8:29 a.m.) 3 MR. TULCHIN: Mr. Holley will address 4 this, but I want to give the Court a copy of 5 the alert we sent to Mr. Lamb last night and 6 Mr. Holley can explain this to you. 7 THE COURT: The mail delivered it 8 already to him? 9 MR. HOLLEY: It went via e-mail, Your 10 Honor. 11 THE COURT: I'm just teasing. 12 MR. HOLLEY: The wonders of 13 technology. 14 So, Your Honor, we're back on the 15 question of whether Mr. Alepin can in the 16 course of his testimony publish demonstrative 17 exhibits to the Jury that contain legal 18 conclusions in light of the Court's ruling 19 yesterday. 20 On an example of this is attached as 21 the letter -- to the letter as Exhibit A, which 22 is a slide in which was used during 23 Mr. Alepin's testimony about the bundling or 24 tying. 25 And Your Honor will notice on the 6609 1 lower right-hand corner there, there's an icon 2 which says tying and bundling and has two boxes 3 held together by chains. 4 Those icons are not new. If you look 5 at Exhibit D, you'll see that this is a slide 6 from Ms. Conlin's opening statement. And there 7 on the first row, second from the left, is this 8 tying and bundling icon. 9 Now, in this context, it's important 10 to bear in mind what it is that Ms. Conlin told 11 the jurors about what these icons mean. And 12 I'm quoting now from the trial transcript, page 13 2653 at line 17 to 2654, line 1. 14 Ms. Conlin said, now, let me talk to 15 you about Microsoft's illegal tactics, the 16 things that Microsoft does that destroy 17 competition. What are the illegal tactics that 18 restrict competition and harm consumers? We 19 have created some icons for you. 20 These are graphical representations. 21 They are among the things that you will not 22 have in the Jury room. They're only for the 23 purpose of identifying and helping you to 24 remember what these tactics are. 25 I will talk about what they mean as we 6610 1 go along, but here are these graphical icons 2 and representations. Here are the things we 3 say Microsoft did to destroy competition. 4 And then with respect to this 5 particular icon, tying and bundling, Ms. Conlin 6 said the following at page 2654, line 7 to 10. 7 Tying and bundling, putting products 8 together in a way that leveraged the monopoly 9 power and the operating system into other 10 markets. 11 And, Your Honor, there are similar 12 icons that appear on other slides that 13 apparently the Plaintiffs intend to use with 14 the Jury this morning. 15 And this is precisely, Your Honor, 16 what the Court said yesterday that the 17 Plaintiffs are not entitled to do. 18 Ms. Conlin told the Jury in the 19 section of the opening I just quoted that these 20 icons are anticompetitive actions by Microsoft 21 that destroyed competition and that they are 22 illegal. 23 It is their lexicon. They created it. 24 They created the icons. They asked the Jury to 25 bear them in mind and associate them with 6611 1 illegal behavior. 2 And it's not appropriate in light of 3 the Court's ruling yesterday for Mr. Alepin to 4 be using these very anticompetitive/illegal 5 icons in the course of his testimony. 6 Thank you, Your Honor. 7 THE COURT: Mr. Lamb? 8 MR. LAMB: Thank you, Your Honor. 9 Obviously, Mr. Alepin has not referred 10 at all to the icon. 11 With the Court's indulgence, if I 12 could approach. 13 THE COURT: Sure. 14 MR. LAMB: I want to hand you a copy 15 of a stipulation that the parties entered into 16 in relation to demonstrative evidence, which we 17 touched on briefly yesterday. 18 But if you'll note, we entered into a 19 stipulation whereby we agreed to set forth 20 objections in a timely manner. 21 Again, I don't think it's contested 22 that those objections were not set forth in a 23 timely manner. Again, this is another attempt, 24 we believe, to just simply disrupt the 25 presentation of evidence. 6612 1 I don't intend to have Mr. Alepin 2 refer at all to the icon. The icon is simply a 3 useful graphic. It conveys an idea. His idea 4 as he set forth regarding bundling and tying 5 clearly relates to the technology. 6 There will be exhibits today, 7 Microsoft exhibits from Microsoft employees, 8 which will specifically use the term bundling 9 in a technological sense. And Mr. Alepin will 10 describe that. 11 Another icon relates to vaporware. 12 Vaporware is actually something that is defined 13 by the Microsoft computer dictionary. 14 Again, this is just an icon that 15 conveys an idea. And it is not necessarily 16 attributable, as Mr. Holley would suggest to, 17 quote, icons are anticompetitive, end quote. 18 That is not what Mr. Alepin's 19 testimony is, and, in fact, that is a 20 misstatement of really the opening statements 21 by Ms. Conlin. 22 She didn't say the icons are 23 anticompetitive. That was what she was trying 24 to convey at that particular time. 25 MR. HOLLEY: Your Honor, obviously, we 6613 1 couldn't object about their violation of the 2 Court's order until the order was entered. 3 That doesn't make any sense. 4 But as of yesterday afternoon, it was 5 quite clear that Mr. Alepin's testimony had to 6 be limited. He was not to offer legal opinions 7 and he was not including ones, but whether 8 Microsoft's conduct was anticompetitive in an 9 antitrust sense. 10 I read to the Court what Ms. Conlin 11 said in opening about the purpose of these 12 icons. If they're devoid of meaning, Your 13 Honor, what are they doing on these 14 demonstratives? 15 They're only there for one reason, 16 because the Plaintiffs know that the Jury saw 17 them in opening and they're hoping that they 18 associate what Mr. Alepin is saying with 19 Ms. Conlin's assertion that certain things are 20 illegal. 21 Your Honor, it's quite transparent 22 here. And the effort to avoid what's going on 23 isn't very persuasive. These icons should not 24 be shown to the Jury. 25 THE COURT: I don't see in the 6614 1 exhibits that I've been given that there's any 2 further use of that icon. 3 MR. LAMB: There is no further use of 4 that icon. The only other icon they object to, 5 I believe, is vaporware and then the icon that 6 is FUD, fear, uncertainty, and doubt. And then 7 I believe they also object to the icon, which 8 is an API, which simply shows a switch and a 9 shadow. That's nothing to do with an illegal 10 tactic. That's a technological term. 11 And really what Ms. Conlin said, we're 12 talking about conduct and tactics. 13 Her opening statement is an opening 14 statement about what she believes the evidence 15 will show. 16 MR. HOLLEY: I couldn't agree more, 17 Your Honor, and that's why this is so 18 prejudicial. 19 What Ms. Conlin said in her opening 20 was not evidence, but she did encourage the 21 Jury to associate these little pictures with 22 what she said were illegal and anticompetitive 23 acts. 24 So if you look at page 9, for example, 25 Your Honor, of the latest slide deck, with the 6615 1 heading Microsoft handicaps development, there 2 is the vaporware icon. 3 In opening, Ms. Conlin told the Jury 4 that vaporware was illegal and that it was 5 anticompetitive. 6 On page 14, there is a reference to 7 the term coined by Mr. Alepin's former employer 8 end all fear, uncertainty, and doubt. 9 Ms. Conlin in her opening told the 10 Jury that FUD was illegal and anticompetitive. 11 On page 29 there is a reference to 12 undocumented APIs. Ms. Conlin said in her 13 opening that undocumented APIs were illegal and 14 anticompetitive. 15 And I believe, Your Honor, that there 16 is one more. 17 THE COURT: Are you looking at the 18 exhibit, the demonstrative? 19 MR. HOLLEY: I believe, Your Honor, 20 I'm looking at the ones that we got at 21 approximately 30 minutes after midnight this 22 morning. 23 If Your Honor does not have those -- 24 THE COURT: I have the ones that you 25 guys gave me yesterday. 6616 1 MR. HOLLEY: I'm sorry, Your Honor. 2 There's a superseding set that we got early 3 this morning. 4 MR. LAMB: I have another copy, Your 5 Honor. 6 May I approach? 7 THE COURT: Yes. Thank you. 8 MR. HOLLEY: No, Your Honor. Just for 9 clarity, there is an icon on page 2 of the new 10 set, which is the tying and bundling one that 11 I've already discussed. 12 I referenced a page 9, which is the 13 vaporware icon. 14 Page 14, which is the FUD icon. 15 And page 29, which is the undocumented 16 API icon. 17 And I think that's the last of them. 18 But in each of these instances, Your 19 Honor, there's nothing technical about those 20 icons. They are, as Ms. Conlin said in 21 opening, icons for you, graphical 22 representations. They're only for the purpose 23 of identifying and helping you to remember what 24 these tactics are. Here are the things we say 25 Microsoft did to destroy competition. 6617 1 That's what they're for. They have 2 nothing to do with computer science. 3 THE COURT: Mr. Lamb? 4 MR. LAMB: Your Honor, I believe what 5 he said here are the things that we believe 6 Microsoft did, vaporware. There are exhibits 7 regarding vaporware. 8 Mr. Alepin will testify about the 9 impact on technology of vaporware. FUD, fear, 10 uncertainty and doubt, there are exhibits that 11 we have, Microsoft exhibits, that specifically 12 refer to fear, uncertainty, and doubt. 13 There are Microsoft employees that 14 talk about using fear, uncertainty, and doubt 15 and the impact of the technology in that 16 relationship. 17 In addition, undocumented APIs. 18 Undocumented APIs. There's no -- there's no 19 legal violation of undocumented APIs. 20 Undocumented APIs is the event. If we're going 21 to contend that it's illegal later, that's 22 really whether or not we can claim that the 23 event occurred. The event occurred, and this 24 is simply descriptive of the event. 25 I mean, under that theory, nothing 6618 1 that Ms. Conlin or Mr. Hagstrom used in slides 2 in their presentation on opening should ever be 3 able to be used, and the same for Mr. Tulchin, 4 in presentation to the Jury, because there 5 might be some connection, you know. 6 I think the Jury is a lot smarter than 7 that, and they understand what's happening. 8 And I think the Court has made it very clear 9 what Mr. Alepin's testimony will and will not 10 be. And he's not going to render a legal 11 opinion. 12 MR. HOLLEY: Your Honor, I don't mean 13 to belabor this, but the Jury is very smart. 14 Many of them will remember these 15 icons. They will remember what they were told 16 they mean. And what they were told they mean 17 is the things that the Plaintiffs say Microsoft 18 did to destroy competition and that the tactics 19 were illegal. 20 Now, if Mr. Alepin wants to talk about 21 his view about the technical aspects of whether 22 a particular interface in an operating system 23 should be documented or not, under the Court's 24 ruling of yesterday, he is entitled to do that. 25 He is not entitled to opine about 6619 1 whether or not that is a violation of the Iowa 2 Competition Law or whether it is pro or 3 anticompetitive. 4 But these icons are infused with 5 exactly that significance. That is what 6 Ms. Conlin invited the Jury to conclude 7 whenever they saw these icons. 8 She's trying to create an association. 9 I give her credit. It's a very nice tactic, 10 but it is not consistent with the Court's 11 order. 12 THE COURT: Very well. 13 Anything else? 14 MR. LAMB: No, sir. 15 MR. HOLLEY: No, Your Honor. 16 THE COURT: I think I'm going to allow 17 you to use the vaporware since it is defined by 18 the Defendant itself. 19 Fear, uncertainty, and doubt on page 20 14, that icon -- 21 MR. LAMB: Your Honor? 22 THE COURT: Yeah. 23 MR. LAMB: Again, I have specific 24 Microsoft exhibits that reference fear, 25 uncertainty, and doubt. 6620 1 THE COURT: Correct. The icon itself, 2 can that be erased, but leave the other part? 3 Just the icon? 4 MR. LAMB: The icon can be erased. 5 THE COURT: Okay. And you are not 6 using Number 2, I assume? 7 MR. LAMB: I am not using Number 2 8 again. 9 THE COURT: Okay. That's fine. 10 MR. LAMB: And you want us to erase 11 the icon FUD on 14? 12 THE COURT: Vaporware is okay. 13 MR. HOLLEY: And, Your Honor, just for 14 clarity, the one on page 29 entitled 15 undocumented APIs, does the Court have a view 16 on that one? 17 THE COURT: 29? 18 MR. HOLLEY: Yes, Your Honor. 19 THE COURT: Hang on. 20 Yeah, you can remove the icon, but 21 leave the rest of it. That's fine. 22 Okay? 23 MR. LAMB: Okay. Can we do that real 24 quickly to make sure we've done it? 25 THE COURT: Sure. 6621 1 MR. LAMB: Darin, can you make sure 2 when you've done it. 3 You've done it? You are good. 4 THE COURT: Wow, you are good, Darin. 5 Can I bring the Jury? That's fast. 6 MR. HOLLEY: Wonders of PowerPoint, 7 Your Honor. 8 MR. LAMB: One other thing. What is 9 the Court's preference regarding the easel 10 versus the white board versus the location? 11 THE COURT: If it's something -- if it 12 needs more room, we can use the white board, 13 but try to use the easel if we can. Okay? 14 MR. LAMB: Okay. And, again, can we 15 set this up over there? 16 THE COURT: Yeah, that's fine. Or you 17 could put -- 18 MR. LAMB: I'm going to need to take 19 this down. Do you know how it comes apart? 20 MR. HOLLEY: Don't pinch your fingers. 21 MR. TULCHIN: Yeah, be careful. 22 THE COURT: And, Mr. Lamb? 23 MR. LAMB: Yes. 24 THE COURT: I've got some colored 25 markers. I put them on Ms. Conlin's -- but you 6622 1 can use them if you want. 2 MR. LAMB: Pardon me? 3 THE COURT: Those colored markers I 4 got for you. 5 And if you want to move that closer 6 for the Jury to see, you can do that too. 7 MR. LAMB: Is that going to be okay? 8 THE COURT: That's okay. Can you guys 9 see it? Can you put it at an angle or 10 something? 11 MR. TULCHIN: We'll switch seats and 12 that will be fine. 13 MR. LAMB: How's that? 14 MR. HOLLEY: Yeah. I'll scoot over 15 and I'll see it. That's fine. 16 (The following record was made in the 17 presence of the jury at 8:47 a.m.) 18 THE COURT: Mr. Alepin. Sir, you are 19 still under oath. 20 THE WITNESS: Thank you. 21 RONALD ALEPIN, 22 called as a witness, having been previously 23 duly sworn, testified as follows: 24 MR. LAMB: Would you put up slide 7, 25 Darin? 6623 1 DIRECT EXAMINATION (CONT'D) 2 BY MR. LAMB: 3 Q. Okay. Good morning, Mr. Alepin. 4 A. Good morning. 5 Q. When we broke yesterday, you were in 6 the middle of a discussion regarding an 7 exhibit, Exhibit 5735. 8 MR. LAMB: Can you pull that up, 9 Darin? Highlight the -- yeah, thank you. 10 Q. And you were explaining this phrase, 11 clone their client technology early and often 12 (full embrace strategy). 13 Do you recall that, sir? 14 A. I do, yes. 15 Q. Okay. And at that point in time, you 16 were challenged that you had just made that 17 phrase up, embrace, extend, and extinguish. 18 Do you recall that? 19 A. Yes, I do. 20 MR. LAMB: Okay. I'd like to call up 21 Exhibit 2403, please. 22 Can you go on 2403 to the heading? 23 Q. Can you tell the Jury who those people 24 are? 25 A. There are John Ludwig, Brad 6624 1 Silverberg, Ben Slivka, Thomas Reardon, Darrell 2 Reuben, Paul Maritz, Chris Jones. I forget who 3 Victor S. is, but that's the names of 4 executives within the Microsoft organization 5 including the head of Windows desktop operating 6 system, Brad Silverberg and his superior Paul 7 Maritz. 8 Q. Okay. And what's the subject of this 9 particular memo, sir? 10 A. The subject is a response to anti-Java 11 strategy memo. 12 Q. Okay. 13 A. Or reply. 14 Q. And this is dated September 4th, 1995; 15 right? 16 A. Yes. 17 MR. LAMB: Can you highlight the first 18 sentence, Darin, some additional thoughts? 19 Q. Okay. Can you read that for us? 20 A. Some additional thoughts. These are 21 all based on my conclusion that Java is already 22 here, and we need to move down the 23 embrace/extend path. 24 Q. Okay. And now, again, for the Jury, 25 what does embrace mean in this context as used 6625 1 by Microsoft employees? 2 A. It's used to indicate a strategy where 3 Microsoft will embrace the standards or the 4 specifications and interfaces of another 5 company's software. 6 Q. Okay. And what does extend refer to? 7 A. Once the specifications have been 8 embraced, then Microsoft will extend them and 9 add additional interfaces proprietary to 10 Microsoft. 11 Q. Okay. When you say add additional 12 proprietary interfaces that are Microsoft's, 13 what impact does that have technologically to 14 other ISVs and OEMs? 15 A. Well, the result is or the impact is 16 that what was once sort of community 17 development property, the work of the industry 18 and industry participants is appropriated 19 essentially, is taken over by Microsoft. 20 And then Microsoft takes it and with 21 its proprietary extensions, makes it 22 essentially unavailable on a going-forward 23 basis to the industry participants who were 24 responsible for first developing the 25 specifications and the standards. 6626 1 Q. Okay. And when Microsoft makes those 2 APIs unavailable to certain ISVs and OEMs, 3 what's the impact to those ISVs and OEMs of 4 their ability technologically to create 5 products? 6 A. It reduces their ability to create 7 products, especially products that will 8 interoperate with Microsoft's products. 9 Q. Okay. Thank you, sir. 10 MR. LAMB: Darin, could you go right 11 above paragraph 2 and highlight that for us? 12 Q. Okay. Do you see the section there, 13 sir, where it says there are a bunch of 14 options, but the answer really revolves around 15 our company strategy. Given that we don't 16 think Java is going to be around or that we 17 don't want to encourage it, we should figure 18 out a way to have our browser sniff the applet 19 tag in HTML (Java object) then prompt the user 20 to fetch the runtime from Sun. 21 Do you see that, sir? 22 A. I do. 23 Q. Can you tell that jury, what does that 24 mean? When it references our browser, what is 25 that referring to? 6627 1 A. Our browser is the Microsoft Internet 2 Explorer. 3 Q. Okay. And when it says sniff the 4 applet tag in HTML, tell the Jury what that 5 means. 6 A. Well, what that means is to identify a 7 particular markup language identifier that 8 would indicate that this is a Java applet. 9 Q. Okay. And then where it says then 10 prompt the user to fetch the runtime from Sun, 11 what does that mean? 12 A. That means that the user would be 13 asked if he wanted to go and get the Java 14 runtime software, the Java Virtual Machine from 15 Sun and install it on the user's computer. 16 MR. LAMB: Okay. Go down to the 17 bottom paragraph, Darin. Very bottom 18 paragraph. 19 And then if you can highlight the 20 second page and add paragraph 3 underneath 21 that. 22 Can't do that on the same screen? 23 Okay. 24 All right, it can be done. We have 25 the technology. 6628 1 Q. All right. Do you see there where it 2 says one strategy is to jump on the Java 3 bandwagon and try to take control of the class 4 libraries and runtime? What are class 5 libraries? 6 A. Well, I mentioned before in 7 yesterday's conversation that there were these 8 subroutines. Sometimes they were referred to 9 as DLLs. I think I used the term distributed 10 link libraries. 11 Another manifestation of the same 12 idea, another way of approaching the same idea 13 of taking subroutines and making them available 14 is something called the runtime and class 15 libraries. They are the equivalent, if you 16 will, of subroutines in the Java world. 17 Q. Okay. Is that something you could 18 diagram for the Jury so they can see what a 19 Java Virtual Machine does? 20 A. Sure, I can do that. 21 MR. LAMB: Permission of the Court? 22 THE COURT: You may. 23 MR. LAMB: Does this matter whether 24 it's on white board? I don't know what the 25 Court's preference. 6629 1 THE COURT: Why don't you use the 2 easel. Can you use the easel, please? 3 THE WITNESS: I'll try. I have a 4 tendency to slide down the easels. 5 THE COURT: Slide? 6 THE WITNESS: Slide. My handwriting 7 goes, you know, like this. 8 MR. LAMB: There's some markers in the 9 back there. 10 THE WITNESS: Thank you. 11 A. All right. So before we talked about 12 an operating system and we had applications in 13 it and we might have had middleware in here, 14 and these would be tied to a particular 15 platform. 16 So this would be -- for example, this 17 application would be linked to -- and I believe 18 I used the term locked into the Windows 19 platform. 20 In 1993 and 1994, the folks at Sun 21 Microsystem came up with this idea of putting 22 between the operating system and the 23 applications a virtual machine. So these. 24 In Sun's Java world, these 25 applications were known as applets. And the 6630 1 idea was that you would download them from the 2 Internet and you would make them so they could 3 run on your machine. 4 But they would run inside something 5 called a virtual machine that would insulate 6 the application from any dependencies on the 7 operating system. 8 So essentially you could take -- 9 Q. Hold on a second there. When you say 10 insulate the applications from the operating 11 system, technologically, what's the impact of 12 that? 13 A. That meant that the applications were 14 portable and that the same application could be 15 downloaded from a website and run on a 16 Macintosh computer or on a Windows computer or 17 on a Linux computer without any change. 18 Q. So the operating system didn't matter? 19 A. The operating system didn't matter, 20 that's correct. 21 Q. Go ahead, sir. 22 A. So the Java Virtual Machine was 23 responsible for maintaining all of the local 24 information, information about the operating 25 system that their JVM -- that's a shorthand 6631 1 word for Java Virtual Machine -- that the JVM 2 was responsible for managing all of the local 3 interfaces to the operating system, but the 4 application used only the interfaces available 5 from the Java Virtual Machine. 6 Those same interfaces were available 7 on every system that Java Virtual Machine would 8 run on. And there were, I believe, more than 9 30 different computer platforms that the Java 10 Virtual Machine software could run on. 11 And that meant that you could download 12 an application from a website, Java 13 application, and could run on 34 different 14 computers without you having to recode the 15 application or -- a term that I used 16 yesterday -- without you having to port the 17 application by changing the APIs and making 18 other changes. 19 Q. Okay. You can go ahead and take your 20 seat again, sir. It goes in the back. 21 Sir, referring again to the exhibit, 22 Exhibit 2403, paragraph 3 there, it says, we 23 should consider support for Java as a platform. 24 As a company, we have two options for embracing 25 and extending Java. 6632 1 Do you see that phrase, again, 2 embracing and extending; right? 3 A. I do. 4 Q. And does it mean the same thing that 5 it meant earlier, in your mind? 6 A. Yes. 7 Q. Okay. 8 MR. HOLLEY: Your Honor, objection. 9 On November 9th of 2006, the Court 10 issued a ruling on motions in limine where the 11 Court said no witness -- 12 MR. LAMB: Your Honor, this is a 13 speaking objection. 14 MR. HOLLEY: Your Honor, I just need 15 to state the basis of my objection. 16 THE COURT: Let's take it outside the 17 presence of the jury. 18 (The following record was made out of 19 the presence of the jury at 9:01 a.m.) 20 MR. HOLLEY: Your Honor, on the 9th of 21 November of 2006 in response to Microsoft's 22 motion in limine to preclude plaintiffs' 23 experts from testifying about Microsoft's 24 corporate intent objective and knowledge the 25 court stated generally no expert or witness can 6633 1 testify about an individual's intent or state 2 of mind. And it seems to me, Your Honor, what 3 Mr. Lamb is seeking to do is get Mr. Alepin to 4 testify about what he thinks Microsoft intended 5 when Microsoft's witnesses can say that, but 6 Mr. Alepin doesn't have any expertise in 7 deciding what Microsoft wanted to do or what 8 its motives were. This is what I sometimes 9 refer to as the intentologist expert where 10 somebody gets up on the stand and looks at a 11 bunch of documents and says, "I say that person 12 intended x." Well, how does he know? And 13 that's exactly why we filed this motion, and I 14 believe that the Court properly ruled that 15 experts are not allowed to testify about 16 Microsoft's intent or state of mind. 17 THE COURT: Well, isn't he testifying 18 as to what the language means? 19 MR. HOLLEY: But it means -- his 20 interpretation of what Microsoft intends when 21 they says embrace or extend. It's different in 22 my mind than saying -- he's already testified 23 that embrace means, you know, clone everything 24 somebody does, and extend means add priority 25 extensions that aren't available to other 6634 1 people. So he's already said that. He's 2 already said what embrace and extend mean. 3 And Mr. Lamb can correct me if I'm 4 wrong, but if he believed that the question was 5 then asking him what about what he believed 6 Microsoft intended by using that phrase, and 7 that's not something that he can say. 8 THE COURT: Was that the question? 9 MR. LAMB: That was not the question. 10 The question was: "What did it mean to you?" 11 And he had already testified about general 12 industry meaning and, frankly, you know, having 13 been challenged about this issue, we're going 14 to go over two more exhibits that refer to 15 this. He's going to talk about it. 16 And we're going to go over trial 17 testimony where someone from another company 18 recounted a conversation with Paul Maritz, who 19 is a senior executive at Microsoft, where Paul 20 Maritz told him exactly what embrace, extend 21 and extinguish mean. 22 MR. HOLLEY: Well, I don't think we're 23 going to do that or at least I'm going to 24 object because he's not an expert on that 25 testimony. 6635 1 Mr. Maritz testified that he never 2 said that there is no finding by Judge Jackson 3 about who is telling the truth about that 4 conversation. And Mr. Alepin can't tell this 5 jury that Steve McGeady said something. If 6 Steve McGeady wants to come here and repeat 7 that testimony, we can cross-examine him, but 8 it's not proper for Mr. Alepin to start 9 referring to things that happened in U.S. v. 10 Microsoft in reading things from the transcript 11 to the jury. 12 The Court's order of yesterday said 13 he's not allowed to opine about findings, 14 conclusions and determinations in other 15 lawsuits. 16 MR. LAMB: Your Honor, he's not. He's 17 an expert. He's reviewed documents. He's 18 reviewed exhibits. He's reviewed testimony. 19 He's entitled to rely on them, hearsay or not. 20 And if counsel wants to impeach him on that, 21 then go and done. That's his entitlement to do 22 that, but he cannot restrict the testimony just 23 because he thinks it's bad for Microsoft. 24 MR. HOLLEY: That's not the basis for 25 my objection, Your Honor. He's here as an 6636 1 expert based on his experience in the computer 2 industry. So he can talk about his 3 understanding of what technological terms mean, 4 but he's not an expert on whether Paul Maritz 5 told McGeady at Intel that somebody was going 6 to engage in embrace, extend and extinguish. 7 Yesterday Mr. Alepin honestly testified he's 8 never seen that formulation in any Microsoft 9 document. I've never seen it. There is no 10 Microsoft document that says embrace, extend, 11 extinguish. That's a really relevant fact, 12 which we'll obviously be entitled to tell the 13 jury about. But why should this man who is not 14 here as the walking National Enquirer of the 15 computer industry get up on the stand and tell 16 the jury that some guy who they say is coming 17 to testify in this case said something in a 18 prior lawsuit? That's not his expertise. 19 MS. CONLIN: Maybe we should do one at 20 a time, Your Honor. 21 Right now what is pending before the 22 Court is a question that already was posed by 23 Mr. Lamb, which in our opinion is clearly 24 proper, and then perhaps we should move on to 25 the other issue. 6637 1 THE COURT: I think that's a good 2 idea. I'm going to allow him to state what he 3 believes the language means to him as he reads 4 it. 5 MR. LAMB: That is all I asked him, 6 sir. 7 MR. HOLLEY: But is the Court 8 intending to adhere to the November 9th ruling 9 that Mr. Lamb is not entitled to ask Mr. Alepin 10 what Microsoft's intent or state of mind was 11 based on his reading of Microsoft's internal 12 documents? 13 THE COURT: He can say what it means 14 to him. For instance, if he says he's planning 15 to kill somebody, he can say that sounds like 16 they're planning to kill somebody if it says 17 that. 18 MR. HOLLEY: Well, the problem with 19 that, Your Honor, in this context is that 20 Mr. Alepin doesn't know whether, you know, Ben 21 Slivka is a comic or Chris Jones is trying to 22 be funny. I mean, he doesn't know anything 23 about these documents. He's sitting here 24 reading them cold trying to decide. 25 THE COURT: On the plain face of it, 6638 1 the way it's stated and the way I understand 2 the terms extend and embrace, this is what it 3 appears to say. What it means to me. 4 MR. HOLLEY: What it means to me. 5 THE COURT: But not whether or not, 6 you know, what they intended, you're right. 7 MR. LAMB: Your Honor, I strongly urge 8 us to go back out so we don't keep the jury 9 waiting any longer. One final comment. What 10 is going on here is counsel keeps asking for a 11 series of advisory opinions about evidence we 12 haven't offered, questions we haven't asked and 13 it's all designed to disrupt the flow of his 14 testimony and it is improper. 15 THE COURT: He can say what it means. 16 MS. CONLIN: Your Honor, one other 17 thing, I've never seen a lawyer read from a 18 ruling of the court on a motion in limine as a 19 part of the motion in limine. As I recall, 20 generally speaking, you never refer to the 21 motions in limine. You refer to Court's 22 orders, but reading from a motion in limine? 23 Unbelievable. 24 MR. GREEN: If you have to object, I 25 don't think it's improper. 6639 1 MS. CONLIN: You don't have to do it 2 to object. You object on the basis of the 3 Court's ruling. 4 THE COURT: You can just object. If 5 we have to take it up outside the presence of 6 the jury, we will. 7 (The following record was made in the 8 presence of the jury at 9:08 a.m.) 9 THE COURT: Please rephrase the 10 question. 11 BY MR. LAMB: 12 Q. Again, Mr. Alepin, that phrase 13 embracing and extending Java in paragraph 3 of 14 this exhibit, what did that mean to you? 15 A. That meant that Microsoft would adopt 16 Java. That is to say, adopt the interfaces. 17 And then it would add extensions proprietary to 18 Microsoft. 19 Q. Okay. And what is the impact on other 20 developers of the addition of those extensions? 21 Would you explain that to the Jury? 22 A. Well, the use of those proprietary 23 extensions, those proprietary Microsoft 24 extensions to the Java Virtual Machine APIs 25 would lock the application or the applet to the 6640 1 Windows computer. Meaning that those applets 2 would only run on or with a Windows computer. 3 Q. Okay. With the Court's permission, 4 could you get down and show on the diagram that 5 you have what the impact of the addition of 6 those applications would have? 7 A. Excuse me, the addition of those 8 applications programming interfaces? 9 Q. Yes, APIs. 10 THE COURT: Speak loudly, please. 11 THE WITNESS: I'm sorry. 12 A. Okay. So here is our Java Virtual 13 Machine. Here are the interfaces between the 14 applet or the application and the Java Virtual 15 Machine interfaces including -- just, for 16 example, allocate memory for me, get input from 17 the keyboard, those kinds of operations. 18 And what Microsoft extensions would do 19 would be to add additional interfaces. Would 20 add some additional interfaces not available on 21 the other virtual machines that were on other 22 platforms. 23 When the application developer used 24 those APIs, that meant that the applet would 25 only run on the Windows platform. Those kinds 6641 1 of functions would be unique to Windows and 2 would lock the applet into the Windows 3 platform. 4 Q. Okay. Thank you, sir. 5 This e-mail, Exhibit 2403, then goes 6 on to say that there's a couple options. 7 One, we take control of it and add 8 Windows specific classes. 9 Do you see that, sir? 10 A. Yes. 11 Q. And explain to the Jury what that 12 would entail, that option. 13 A. That's the description of what I was 14 just saying. 15 Q. Okay. 16 A. So adding the Windows specific 17 classes -- classes are subroutines or the 18 equivalent of subroutines. They're application 19 programming interfaces, which would be specific 20 to the Windows platform. 21 Q. Okay. And then the second object is 22 we, quote, sandbox, end quote, it, slow it 23 down, and restrict it to a particular domain, 24 betting that we can bring our technology to 25 bear quickly enough to minimize the impact. 6642 1 Technologically, what does that mean 2 sandbox it, slow it down, restrict it to a 3 particular domain? 4 A. It means, as a technical matter, 5 relegating Java's applicability to a specific 6 type of environment or purpose so that it 7 would, for example, be not a general purpose 8 solution for the development of applications. 9 Q. Okay. And then it goes on to say 10 while I would like to pick two, my personal 11 feeling is that we should strongly consider 12 one; namely, fully supporting Java and 13 extending it in a Windows/Microsoft way. 14 Do you see that? 15 A. I do. 16 Q. And, again, extending it in a 17 Windows/Microsoft way, does that have the same 18 meaning, in your mind, as it did the way you've 19 testified earlier? 20 A. It does. 21 Q. Okay. And is that something that 22 you've seen in a number of Microsoft documents 23 used by a number of Microsoft employees? 24 A. Yes. 25 MR. LAMB: Would you pull up Exhibit 6643 1 5803, please? Okay. 2 If you could go to the from/to line. 3 Q. Who's this from? 4 A. This is from Bill Gates. 5 Q. And who's Bill Gates, sir? 6 A. He's the CEO, founder of Microsoft. 7 Q. And who is it to? 8 A. I think was the CEO and still is the 9 founder of Microsoft. 10 Q. Okay. Who is this e-mail to? 11 A. It's to Nathan Myhrvold. 12 Q. Okay. And, again, this is dated 13 September 30th, 1996. 14 The subject, what is the subject, sir? 15 A. The subject is Java runtime becomes 16 the operating system. 17 Q. Who is Mr. Mhryvold? 18 A. Nathan Mhryvold was one of the most 19 senior executives at Microsoft. 20 Q. Okay. Why don't we go to the very 21 first paragraph. 22 And this is Mr. Gates saying I am 23 worry a lot about how great Java/Javabeans and 24 all the runtime work they are doing is and how 25 much excitement this is generating. I am 6644 1 literally losing sleep over this issue since 2 together with a move to more server based 3 applications, it seems like it could make it 4 easy for people to do competitive operating 5 systems. 6 Do you see that, sir? 7 A. I do. 8 Q. Okay. What does the phrase more 9 server based applications mean? 10 A. Well, one of the great potentials for 11 the Internet is that you can create 12 applications that run on a server computer, 13 like a web server or run partially on a web 14 server and partially on your desktop so that 15 there is a cooperative application that can 16 provide some of the nice responsiveness of a 17 local based application with some of the larger 18 capacity features of servers. 19 Q. And is this one of the many e-mails 20 that you reviewed in order to help form your 21 opinions here? 22 A. One of the many. 23 Q. Okay. Now, as you read this in order 24 to form your opinions, do you see where it says 25 I am worry a lot? 6645 1 A. I do, yes. 2 Q. Okay. And does that tell you that 3 Mr. Gates is conveying, at least as you review 4 it, a concern? 5 A. Well, this is a concern that was 6 widespread among Microsoft employees. 7 Q. Okay. And can you tell the Jury, in 8 your opinion, what you view Mr. Gates is 9 conveying the concern to be? 10 A. Well, the concern that Microsoft 11 documents, Microsoft employees discusses the 12 potential that Java had as a technology or as a 13 platform, in particular, to become an operating 14 system and to make it possible to replace the 15 current operating system, the current Windows 16 operating system. 17 Q. It technologically threatened the 18 Windows operating system platform? 19 A. That's correct, yes. 20 Q. Okay. 21 MR. LAMB: Darin, if you could go down 22 about midway in this document where it says I 23 think that the risk of Sun. 24 Q. Sir, that says, I think, that the risk 25 of Sun really taking the OS franchise away from 6646 1 us is much lower than the risk that they 2 cheapen the entire business. 3 They are so hell bent to give things 4 away, and there is so much cross-platform 5 fervor, that it will be hard for them or others 6 to harness this energy toward a single 7 platform. 8 In the limit, they can make the web 9 totally OS agnostic, but there will still be 10 other things that motivate one platform versus 11 another. 12 And, again, what is Sun? 13 A. Sun is Sun Microsystems. They started 14 off as a workstation and had a server company. 15 They had an operating system that -- and still 16 do -- that was based on Unix. Unix was one of 17 the operating systems I put up on the quadrant 18 yesterday. 19 Q. Okay. Mr. Alepin, the term the OS 20 franchise, what does that mean? 21 A. The OS franchise is the Windows -- 22 well, the OS franchise is the operating system 23 platform. 24 Q. You understand Mr. Gates to be 25 referring to Windows? 6647 1 A. The Windows, of course, yes. 2 Q. Okay. And, again, Sun created Java; 3 right? 4 A. Uh-huh. Yes. 5 Q. Okay. Now there's another phrase -- 6 and I believe you said what it meant yesterday, 7 but if you could go over it again, I would 8 appreciate it -- cross-platform. 9 Do you see where it says there is so 10 much cross-platform fervor? 11 A. I do. 12 Q. What does cross-platform mean? 13 A. Cross-platform is -- refers to the 14 ability of applications to run on different 15 platforms without any effort. 16 This was something that emerged as a 17 result of looking at the potential for the 18 Internet and looking at applications like 19 Netscape's browser and Sun's Java. 20 It created the potential for users to 21 -- an independent software vendors to start 22 thinking in terms of one application across all 23 of the hardware and software platforms out 24 there. 25 Q. And, Mr. Alepin, technologically 6648 1 speaking, cross-platform versus single platform 2 is more beneficial for ISVs and OEMs; correct? 3 MR. HOLLEY: Objection, Your Honor. 4 Leading. 5 THE COURT: Sustained. 6 Q. What is the impact of cross-platform 7 in relation to ISVs and OEMs as compared to 8 single platform? 9 A. Well, there is a significant reduction 10 in the cost of development of software. And 11 this shows itself in several ways, but the 12 first of which is that if you have a platform, 13 a cross-platform application, you develop it 14 once and you can run it anywhere. 15 That was the tag line, if you will, of 16 Sun's Java, is write once, run everywhere. 17 The second reduction in cost for an 18 independent software vendor is that the 19 developers only have to learn one platform, one 20 set of interfaces, one way in which to program 21 in order to be able to write programs that run 22 on a variety of platforms. 23 So if you think of, let's say, a 24 vendor like -- independent software vendor like 25 Intuit, if it wanted to make an application 6649 1 that ran on Windows and ran on the Mac, it 2 might have to have two teams of developers, 3 each of which were knowledgeable in the 4 interfaces and the design requirements for 5 applications that run on the Mac and run on 6 Windows, or if it was using cross-platform 7 development tool kit and environment, it would 8 only need to do that once. 9 Q. And what is the impact of 10 cross-platform versus single platform on the 11 common user, the end user, in relation to their 12 ability to download these applets and utilize 13 them? 14 A. Well, when applets are cross-platform, 15 it expands the number of applications that are 16 available to you so you can go to a website. 17 And if you have a Linux computer or a 18 Macintosh computer or a Windows 3.1 computer, 19 you can get an application and it will run. 20 You don't have to either select a 21 specific application or hope that the 22 independent software vendor or the website 23 created the application for your platform. So 24 it would increase the number of applications 25 available to you. 6650 1 MR. LAMB: Darin, if you could go down 2 to the last two paragraphs and highlight those. 3 No, the one below that. 4 Q. Mr. Alepin, Mr. Gates goes on to say, 5 this is not to say that Java is unimportant. 6 It is very, all caps, important, paren, just 7 don't lose sleep, exclamation point, close 8 parens. 9 I think that you are focusing on the 10 wrong, quote, kind, end quote, of threat. We 11 are in danger of losing a new market, which 12 will grow at a pace which is very rapid indeed. 13 This would be a tragedy to have happen 14 to us, but it is different than a direct 15 assault on our core asset. And our response 16 must also be different. The obvious things to 17 do are, colon. 18 Now, when Mr. Gates refers to the core 19 asset, what piece of technology, in your mind, 20 is he referring to? 21 A. Well, the core asset is the operating 22 system. It's the Windows -- at this time it's 23 the Windows operating system. 24 Q. Okay. 25 MR. LAMB: Darin, could you go to the 6651 1 second page under the top paragraph 1? It goes 2 down a couple lines. 3 Q. Do you see there where it says, one, 4 provide our own means of dramatically improving 5 web pages. Continue to, quote, embrace and 6 extend, end quote, both at the level of new 7 Java tools, like J plus plus, and our broader 8 browser strategy. 9 Do you see that, sir? 10 A. Yes. 11 Q. Okay. And based on your experience in 12 the industry and based on your review of all 13 the documents, what is your understanding of 14 the meaning to you of the phrase, quote, 15 embrace and extend, end quote, as Mr. Gates 16 uses it here? 17 A. It's to copy and adopt the interfaces 18 from others and to extend them in proprietary 19 and unique ways. 20 MR. LAMB: Could I have Exhibit 5906? 21 Can we do the to/from line. 22 Q. This is from Aaron Contorer. 23 Do you see that? 24 A. Yes, I do. 25 Q. Do you know who that was or is? 6652 1 A. I believe he was in the developer 2 tools organization. 3 Q. Okay. You need to speak up, sir. I 4 apologize. I'm really loud. You're really 5 quiet. Okay. 6 A. Yes. 7 Q. We're getting there. 8 A. All right. 9 Q. Okay. And it's to who? 10 A. It's to Bill Gates. 11 Q. Okay. Now, again, if we could go to 12 the first paragraph where it says, the first 13 two paragraphs that starts with today. 14 It says, today we face the largest 15 threat Microsoft has faced since the success of 16 Windows. 17 For the first time there is a really 18 credible threat to our position as the leading 19 platform for ISVs to write to. 20 Windows faces challenges in satisfying 21 end users and IT organizations, but we have a 22 lot of smart work underway to address these 23 problems. 24 By contrast, we are not executing on a 25 strategy that lets us maintain our leadership 6653 1 position as the people who define the platform 2 for ISVs. 3 Owning this platform is the Microsoft 4 asset. It is the difference between growing to 5 twice our current size in the future, or 6 shrinking to much less than the role we enjoy 7 today. 8 Do you see that, sir? 9 A. I do. 10 Q. Okay. And when Mr. Contorer refers to 11 owning this platform is the Microsoft asset, 12 when he refers to the Microsoft asset and the 13 platform, what is your understanding of that 14 terminology? 15 A. Well, it's the -- as I referred to 16 yesterday, the platform that we speak of is the 17 set of programming interfaces that in this 18 particular case here would be Windows. 19 Q. Okay. 20 MR. LAMB: If you could go to the next 21 two paragraphs, Darin. 22 Q. This memo goes on to Mr. Gates to say, 23 there are three possible ways to address the 24 threat of the Java platform. 25 One is to do nothing and gradually die 6654 1 as others innovate around us. 2 The second is to join the parade of 3 people who are saying, quote, let's kill 4 Microsoft and share their market among us, end 5 quote. Good for everyone else, but reducing us 6 to the much smaller role of a common software 7 company like Lotus or Borland, or even 8 Symantec. 9 That's a great way to make all our 10 stock options worth zero, even if we would not 11 technically be out of business. 12 The third choice is to make major 13 innovations to our platform so people still 14 prefer to write to us instead of some tepid 15 cross-platform Java layer. This is our only 16 real option. 17 Okay. Again, the platform, what's the 18 reference to, as you understand it? 19 A. The Windows platform. 20 Q. Okay. And of those three options, 21 based on your review of all the evidence, what 22 option do you believe Microsoft took? 23 A. It took the embrace and extend option. 24 Q. Okay. It goes on to say, for over 25 half a year, I have been upset that some people 6655 1 at Microsoft are apparently working hard on 2 plan two to destroy the value of the Windows 3 API. 4 Do you see that? 5 A. Yes. 6 Q. Okay. What does that mean, the value 7 of the Windows API from a technology point of 8 view? 9 A. Well, the ability to own and to extend 10 the application programming interface and keep 11 the applications that independent software 12 vendors have developed locked into the Windows 13 platform is the thing of considerable value. 14 MR. LAMB: If you could go to the next 15 page, Darin. 16 And if you could highlight the last 17 two lines of the first paragraph under 18 switching costs to the end of the paragraph 19 that starts extend. Right there. All right. 20 Thank you, sir. 21 Q. Okay. Do you see there, it says there 22 is a name for this, colon, it is called, in 23 caps, embrace, and, again in caps, extend. 24 Do you see that, sir? 25 A. I do. 6656 1 Q. Okay. And when you read that based on 2 all your training and experience in the 3 industry and based on all the documents that 4 you've reviewed, what do you understand the 5 phrase embrace and extend to mean? 6 A. It means to adopt the interfaces and 7 standards and other specifications of another 8 platform or software product. 9 And extend means to add interfaces or 10 specifications to that platform and have those 11 extensions be unique and proprietary to the 12 Windows platform. 13 Q. Okay. And the next paragraph says, 14 embrace means we are compatible with what's out 15 there so you can switch to our platform without 16 a lot of obstacles and rework. 17 You can switch from someone else's 18 Java compiler to ours; from someone else's web 19 server to ours, et cetera. Customers love when 20 we do this (as long as we don't spend our 21 energy embracing extra standards no one really 22 cares about). Our competitors are not so sure 23 they like it because they prefer us to screw 24 up. 25 In there, what does that mean 6657 1 embracing extra standards no one really cares 2 about? 3 A. Well, some standards can run into the 4 thousands of pages and deal with exotic 5 environments and exotic conditions, and there's 6 a -- one needs to be careful that one doesn't 7 spend a lot of time doing a lot of work for 8 special circumstances that are unlikely to 9 arise in the normal course of running some 10 software. 11 So you don't want to copy everything. 12 The idea is to copy the most specifications 13 that represent the most cases. 14 Q. And then the next paragraph says, 15 extend means we provide tremendous value that 16 nobody else does. 17 So, A, you really want to switch to 18 our software, and B, once you try our software, 19 you would never want to go back to some 20 inferior junk from our competitors. 21 Customers usually like when we do 22 this, since, by definition, it's only an 23 extension if it adds value. 24 Competitors hate when we do this 25 because, by adding new value, we make our 6658 1 products much harder to clone. 2 This is the difference between 3 innovation and just being a commodity like dot 4 com where suppliers compete on price alone. 5 Nobody builds or sustains a business 6 as successful as Microsoft by producing trivial 7 products that are easy to clone. That would be 8 a strategy for failure. 9 Do you see that, sir? 10 A. I do. But I think it's like corn. 11 Q. Like what? 12 A. Like corn. 13 Q. Oh, like corn? 14 A. A commodity like corn. 15 Q. You're right. We're in Iowa. I 16 should see that. I apologize. Okay. 17 A. I'm sorry. 18 Q. No. That's all right. 19 From a technological point of view, 20 what is it you understand he is saying? 21 A. He's saying that extend means that you 22 add additional functionality that would draw 23 developers to the platform, the extended 24 platform. 25 Q. But that additional functionality, how 6659 1 does that adversely impact other ISVs, OEMs, 2 and other end users? 3 A. Well, it makes it harder for them, 4 especially if the interface information isn't 5 disclosed or it is very closely tied to other 6 Microsoft proprietary technology. 7 It makes it very difficult for the 8 rest of the independent software community to 9 take those extensions and make them available 10 to users on other platforms. 11 Q. And is it necessary, in your opinion, 12 technologically for Microsoft to add this 13 innovation and not disclose the APIs? 14 MR. HOLLEY: Objection, Your Honor. 15 THE COURT: Overruled. You may 16 answer. 17 A. No. 18 Q. Why not? 19 A. It's not necessary to -- not to 20 disclose interfaces. There's not -- there's 21 not a technical reason for not disclosing 22 interfaces. 23 Q. Okay. Thank you, sir. 24 Now, in developing your opinions here 25 yesterday and today, you've reviewed a lot of 6660 1 documents; right? 2 A. I have, yes. 3 Q. And you've reviewed depositions; 4 right? 5 A. Yes. 6 Q. And you've reviewed trial testimony; 7 correct? 8 A. Yes. 9 Q. And you've relied on them; correct? 10 A. Yes. 11 Q. Okay. And, in part, in relation to 12 your opinions here yesterday and today, you 13 reviewed the testimony of a Steven McGeady, an 14 Intel executive; correct? 15 A. Yes, I did. 16 Q. McGeady, I'm sorry. M-c-G-e-a-d-y. 17 I'm sorry. I apologize. 18 A. Yes. 19 Q. I'd like to read some of that 20 testimony. It's March 31st, 2004. And it 21 starts: 22 Question: Let me ask you about the 23 November 7th, 1995, Oregon meeting. 24 First, is there any reason that that 25 meeting, in particular, stands out in your 6661 1 head, in your mind or your head? 2 Answer: Well, at that particular 3 meeting -- 4 MR. HOLLEY: Your Honor, I'm sorry to 5 interrupt Mr. Lamb, but this is a subject that 6 I think we need to address at the sidebar for 7 the reasons that I explained earlier. 8 THE COURT: Very well. 9 (The following record was made out of 10 the presence of the jury at 9:35 a.m.) 11 THE COURT: All right. Back on the 12 record. 13 MR. HOLLEY: So this seems to move 14 squarely presenting with collateral estoppel 15 problem we've been discussing. Steve McGeady 16 testified at the Microsoft trial. Judge 17 Jackson made certain findings about that 18 testimony, not including a finding, by the way, 19 about whether or not the testimony he's about 20 to read is true or false. 21 THE COURT: So there's no collateral 22 estoppel. 23 MR. HOLLEY: But there are conclusions 24 which the jury has been read about the 25 interaction between Microsoft and Intel 6662 1 relating to Java and Netscape, and those are 2 preclusive. And why are they entitled to 3 bolster them by talking about things that 4 McGeady said that underlie Jackson's findings. 5 It's purely going to the same issues that are 6 covered in the findings that have been read to 7 the jury and they've been told they have to 8 accept. 9 THE COURT: Which findings do they 10 bolster? 11 MR. HOLLEY: They bolster the findings 12 that Microsoft intimidated Intel and sought to 13 close down the Intel -- it's called IAL, the 14 Intel Laboratories -- 15 MS. CONLIN: Intel Architectural 16 Laboratories. 17 MR. HOLLEY: Thank you. It's scary 18 when she's telling me what the evidence is 19 supposed to say. It shows how much -- 20 MS. CONLIN: I just love do it too. 21 MR. HOLLEY: She's learned a hell of a 22 lot. Anyway, they go to the findings about 23 threatening Intel and seeking to stop Intel 24 development of software. They go to the 25 findings about whether Microsoft sought to 6663 1 persuade Intel not to support Java, sought to 2 persuade Intel not to support Netscape 3 Navigator, and this meeting at which McGeady 4 claims that Maritz said, you know, if you 5 embrace, extend and extinguish was a center 6 piece of the testimony about what Microsoft did 7 to try to persuade Intel not to support Java 8 and not to support Netscape. 9 So it's all dealt with in those 10 findings of fact. It's facts that underlie 11 those findings, and the effort is to bolster 12 the findings. I mean, we obviously suffer from 13 having those findings read to the jury. And as 14 we've said before, that is a strategic choice 15 that the plaintiffs made. They obviously get 16 great benefit from having the jury sitting 17 there with a notebook full of findings, but it 18 doesn't seem fair having that have happened, 19 which, obviously, we live with, to then be able 20 to go behind the findings and talk about the 21 testimony that was in front of Judge Jackson. 22 MS. CONLIN: As the Court points out, 23 there was no finding on this issue or anything 24 close to this issue. And in addition, as we 25 discussed during the opening when we are 6664 1 offering these kinds of materials on other 2 issues such as intent and willfulness, then 3 they're perfectly admissible and permissible. 4 And, of course, using this kind of testimony 5 with an expert is also permissible, whatever 6 the status of the testimony may be because it's 7 the thing upon which he relies in reaching his 8 conclusion. 9 MR. HOLLEY: But that puts them in a 10 difficult conundrum, Your Honor, because if it 11 goes to intent, Microsoft's corporate intent, 12 they are not allowed to have Mr. Alepin testify 13 about Microsoft's corporate intent. So it must 14 be bolstering because it can't be intent and 15 willfulness because he's not entitled to 16 testify about that. 17 MR. LAMB: He can certainly testify as 18 to intent and willfulness on a technological 19 basis, number one. Number two -- if I could 20 finish. 21 MR. HOLLEY: Well -- 22 MR. LAMB: Number two, when counsel 23 makes these speaking objections and personally 24 attacks an expert and says things like he just 25 made that up, we're entitled and indeed should 6665 1 clearly be allowed to explain to the jury why 2 he did that. We're talking about about 12 3 lines of testimony. 4 THE COURT: Read it to me. 5 MR. LAMB: Sure. 6 Well, at that particular meeting where 7 Paul Maritz -- and Paul Maritz is a senior 8 executive at Microsoft -- was in attendance, we 9 had a very frank discussion about the Internet, 10 about Microsoft's strategy and their strategy 11 and in particular towards Netscape and some 12 other competition. And Paul and some of the 13 other attendees made some fairly colorful 14 statements that stick out in my memory. 15 Question: What did Mr. Maritz say 16 that stands out in your memory? 17 Answer: Well, it was a long meeting. 18 There were two phrases that are easy to 19 remember. One was that it was Microsoft's plan 20 to cut off Netscape's air supply. Keep them by 21 -- by giving away free browsers, Microsoft is 22 going to keep Netscape from getting off the 23 ground. 24 And the other phrase, quote, cut off 25 air supply, end quote is one, perhaps, that at 6666 1 least sticks out clearly in my memory. 2 And the other phrase that sticks out 3 clearly in my memory was about, well, I don't 4 -- I won't characterize it, but the description 5 of Microsoft strategy as, quote, embrace, 6 extend, extinguish, end quote. It was kind of 7 a plan that public strategy of love and embrace 8 and extend, the notion that they would embrace 9 Internet standards, extend them presumably in 10 compatible ways that others wouldn't follow and 11 thereby extinguish the competition. 12 THE COURT: What is your question 13 going to be to the witness? 14 MR. LAMB: My question is -- I've 15 already asked him, did you review it and did 16 you in part rely on it when you made the 17 statement which you made which is embrace, 18 extend and extinguish which counsel attacked as 19 having made up. 20 MR. HOLLEY: Your Honor, Mr. Alepin, 21 whatever his expertise, is not here to call 22 pieces from prior cases and tell the jury what 23 they mean. 24 There was a hotly contested debate in 25 the Microsoft case in front of Judge Jackson 6667 1 about whether either of those statements was 2 ever made. 3 And if Mr. McGeady does come here, I 4 will look forward to going through all of that 5 with him again because, you know, that's the 6 appropriate time to try to get this sort of 7 evidence in front of the jury. We will have 8 the same sort of collateral estoppel objection. 9 But letting Mr. Alepin recite trial testimony 10 in order to attribute bad motives to Microsoft 11 is not proper. 12 MR. LAMB: Your Honor, how can it be 13 fair? I apologize. How can it be fair for 14 counsel to say he made it up? You can't talk 15 about it. You can't deal with it. We will 16 deal with it later. 17 THE COURT: Well, I think it's 18 rehabilitative as to the objection because the 19 objection was basically a form of impeachment 20 almost of the comments made. I think that is 21 rehabilitative. So I think it's not 22 substantive evidence, but it goes to the 23 credibility of the witness. 24 MR. HOLLEY: Just to be clear, Your 25 Honor, my objection was that the words he used 6668 1 did not appear in the document, but I accept 2 the Court's ruling. 3 THE COURT: He said made it up. 4 MR. HOLLEY: Well, it wasn't in the 5 documents. 6 THE COURT: Okay. I'll let you do 7 that. 8 (The following record was made in the 9 presence of the jury at 9:43 a.m.) 10 THE COURT: You may continue. 11 MR. LAMB: Thank you, Your Honor. 12 Q. Before I read the testimony, I want to 13 just get a couple things straight in terms of 14 people. 15 Stephen McGeady, who was he? 16 A. He was an employee of Intel 17 Corporation. 18 Q. Okay. And Paul Maritz, who is he? 19 A. Paul Maritz was the head of 20 Microsoft's -- I believe the head of 21 Microsoft's development organizations. 22 Q. And, again, you've got to speak up a 23 little bit because you make me sound like I'm 24 yelling. 25 A. I put the microphone out of harm's way 6669 1 during the sidebar. 2 Q. Okay. Thank you. 3 Now, this is from the transcript. 4 Question: Let me ask you about the 5 November 7th, 1995 Oregon meeting. 6 First, is there any reason that that 7 meeting in particular stands out in your head, 8 in your mind or your head? 9 Answer: Well, at that particular 10 meeting where Paul Maritz was in attendance, we 11 had a very frank discussion about the Internet, 12 about Microsoft's strategy and their strategy 13 in particular toward Netscape and some other 14 competition. 15 And Paul and some of the other 16 attendees made some colorful statements that 17 stick out in my memory. 18 Question: What did Mr. Maritz say 19 that stands out in your memory? 20 Answer: Well, it was a long meeting. 21 There were two phrases that are easy to 22 remember. 23 One was that it was Microsoft's plan 24 to cut off Netscape's air supply. Keep them by 25 by giving away free browsers, Microsoft was 6670 1 going to keep Netscape from getting off the 2 ground. 3 And the other phrase, quote, cut off 4 air supply, end quote, is one perhaps that 5 really sticks out clearly in my memory. 6 And the other phrase that sticks out 7 clearly in my memory was the rather -- well, I 8 won't characterize it, but the description of 9 Microsoft strategy as, quote, embrace, extend, 10 extinguish, end quote. 11 It was kind of a plan their public 12 strategy of love and embrace and extend, the 13 notion that they would embrace Internet 14 standards, extend them presumably in compatible 15 ways that others wouldn't follow and thereby 16 extinguish the competition. 17 And, again, Mr. Alepin, is that 18 testimony in part what you relied on yesterday 19 when you made the comment about embrace, 20 extend, and extinguish? 21 A. Yes. 22 MR. LAMB: Your Honor, I think it's 23 probably break time. 24 Am I right or wrong? 25 THE COURT: Well, I'll agree with you. 6671 1 MR. LAMB: Okay. Thank you, Your 2 Honor. 3 THE COURT: We'll take a 10-minute 4 recess. 5 Remember the admonition previously 6 given. Leave your notebooks here. 7 (A recess was taken from 9:46 a.m. 8 to 10:04 a.m.) 9 THE COURT: I was inquiring of the 10 jury. She had a book and I just wanted to make 11 sure it wasn't a technical book. 12 Thank you. 13 MR. LAMB: Is it safe, Your Honor? 14 THE COURT: It's safe. It has nothing 15 to do with this. 16 MR. LAMB: Okay. 17 THE COURT: Go ahead. 18 MR. LAMB: Thank you, sir. 19 BY MR. LAMB: 20 Q. Mr. Alepin, I've put Exhibit 5906 back 21 up and you've got the from/to line there. I 22 don't know if I asked you this. 23 Aaron Contorer, what position did he 24 have at Microsoft, as you understood it? 25 A. He had a couple of positions, but I 6672 1 believe at this time he was the -- 2 Q. Microphone, speak up. 3 A. It's the microphone. 4 Q. My fault. Go ahead. 5 A. No. He had several positions, I 6 believe, at Microsoft, but at this time I think 7 he was the technical assistant to Bill Gates, a 8 role that -- an advisory role. 9 Q. Okay. In relation to technology, how 10 important is that role? 11 A. It's important. It's an important 12 role. Eyes and ears kind of responsibilities 13 about technology and merging opportunities, 14 that kind of thinking. 15 Q. Thank you, sir. 16 MR. LAMB: Darin, could you put up 17 Finding of Fact 175, please. 18 Q. This is one of the finding of facts 19 that I'm going to read. 20 Finding of Fact 175. 21 No technical reason can explain 22 Microsoft's refusal to license Windows 95 23 without Internet Explorer 1.0 and 2.0. The 24 version of Internet Explorer 1.0 that Microsoft 25 included with the original OEM version of 6673 1 Windows 95 was a separable, executable program 2 file supplied on a separate disk. 3 Web-browsing thus could be installed 4 or removed without affecting the rest of 5 Windows 95's functionality in any way. 6 The same was true of Internet Explorer 7 2.0. Microsoft, moreover, created an easy way 8 to remove Internet Explorer 1.0 and 2.0 from 9 Windows 95 after they had been installed by the 10 code, add/remove panel. 11 This demonstrates the absence of any 12 technical reason for Microsoft's refusal to 13 supply Windows 95 without Internet Explorer 1.0 14 and 2.0. 15 Sir, my question to you is the phrase 16 separable, executable program file, what does 17 that mean? 18 A. That means that the Internet Explorer 19 application program was supplied on a separate 20 disk much the same way that the -- again, plug 21 for Intuit -- the Quicken program would have 22 been supplied. 23 Q. And then the add/remove panel, what 24 does that refer to? 25 A. Add/remove panel, I mentioned that 6674 1 yesterday, but what that is is a facility 2 within the Windows software product that you 3 navigate to from the start menu. And it allows 4 you to see the programs you've got installed on 5 the computer and to, in some instances, repair 6 them or, in other instances, to remove them 7 from the computer. 8 So it's called the add/remove program 9 or add/remove feature of the Windows program. 10 Q. Okay. We're going to double back a 11 little bit to what we were talking about 12 yesterday. 13 And you will recall some of your 14 testimony related to Microsoft's claims that 15 some of the things that we were talking about 16 were innovative. And I'd like to turn now to 17 -- 18 MR. HOLLEY: Objection, Your Honor. 19 Form of the question. 20 MR. LAMB: I'll rephrase. 21 THE COURT: Thank you. 22 Q. I'd like to turn now to active 23 desktop. 24 MR. HOLLEY: Object to the form. 25 MR. LAMB: Can we get the next slide, 6675 1 please? 2 MR. HOLLEY: Sorry. Are you done? 3 Object to the form of the question, 4 Your Honor. 5 THE COURT: Overruled. 6 Proceed. 7 MR. LAMB: The next slide, Darin. 8 Okay. 9 Q. Before I do this, though, sir, in 10 relation to Microsoft's employment of Java and 11 use of Java, when you testified about 12 Microsoft's Java interface extensions -- 13 A. Yes. 14 Q. -- do those interface extensions tie 15 the applets or applications to the Windows 16 operating system? 17 A. They tie them. Another phrase is they 18 bind the applications or they lock them into 19 the Windows platform. That's correct. 20 Q. Okay. Thank you, sir. 21 Now, turning to active desktop. 22 What's active desktop or what was active 23 desktop? 24 A. Excuse me. Active desktop was a 25 feature of Windows, Windows 98 that allowed 6676 1 users to place content on a desktop. 2 That content would be taken from a 3 website. 4 Q. Okay. And was this innovative? Was 5 this new? 6 A. It was new to Microsoft's software, 7 yes. 8 Q. Okay. I apologize. 9 Technologically, in terms of the 10 industry, was this concept new? 11 A. It was a concept that Netscape had 12 described to be available in its forthcoming 13 software. 14 Q. Okay. 15 A. Browser software. 16 Q. And what was the impact of active 17 desktop in relation to the operating system? 18 A. Well -- I'm sorry. I don't quite 19 understand it. 20 Q. Okay. I'm trying to find out if 21 active desktop -- was active desktop bundled or 22 tied to the operating system? 23 A. It was tied to the operating system 24 and bundled. 25 Q. Okay. And bundled. Okay. 6677 1 How was it bundled? 2 A. It was in the same box. 3 Q. Okay. How was it tied? 4 A. It was used by other components of 5 Windows software package. 6 Q. What do you mean it was used by other 7 components of the Windows software package? 8 A. Well, if we think about the 9 relationship between different components of 10 the system, one component making a call to or 11 requesting the use of services from another 12 component is what I was referring to by relying 13 on. 14 So that there are multiple components 15 in a system. Components are another way of 16 describing maybe functionality or features. 17 And one feature of the system relied on the 18 active desktop. 19 Q. Okay. With the Court's permission 20 perhaps you could draw that, how that works. 21 MR. LAMB: Is that okay, Your Honor? 22 THE COURT: Yes. Make sure you talk 23 loud. You got your mike? 24 THE WITNESS: Can I try it? 25 THE COURT: Sure, try it. 6678 1 A. Are we ready? How's that? Is it 2 loud? No. It makes no difference? Oh, good. 3 So, in simple terms, if you have a 4 system that is comprised of many components, if 5 you put a connector or if you make use of an 6 interface that is provided by different 7 components, that's component A, component B, C, 8 D, E, F. 9 If you place a request from component 10 A to component B, you've created a dependency 11 between component A and component B. 12 Then component B has to be there in 13 order for component A to work. That's what I 14 mean by a reliance on. In this particular 15 case, there were reliances on the active 16 desktop component by other components in the 17 system. 18 Q. Okay. Perhaps, sir, if you could draw 19 operating system, Internet Explorer, show us 20 where active desktop was and how it interacted 21 with the operating system. 22 A. Well, we go back to the diagrams, the 23 kernel in the center. And there is a piece of 24 the operating system component -- component of 25 the operating system product called the 6679 1 graphical user interface. Sometimes we call 2 that a shell. 3 Operating systems like Unix or Linux 4 can have a variety of different shells. The 5 shell is what you see on your screen. Again, 6 thinking about the desktop metaphor, that is 7 sometimes referred to as a shell. It's what 8 you see. 9 Linux and Unix can have a variety of 10 different shells and make those available to 11 the user. 12 In earlier days there were different 13 shells available for Windows as well. 14 Here, what happened was Microsoft made 15 changes to the graphical user interface such 16 that it created a dependency on the Internet 17 Explorer, a technology component, as well as 18 connections between these components and the 19 core functionality in the operating system. 20 Q. When you say it created dependencies, 21 what do you mean by that? 22 A. Well, it made -- going back to this 23 diagram here, it caused that one component to 24 rely on the functionality made available by 25 another component. 6680 1 Q. Okay. And was it necessary to do 2 that? Was it necessary to tie and bundle 3 active desktop in order to get that 4 functionality? 5 A. No, it was not. It was a technical 6 matter. It was not -- 7 Q. Where is active desktop? 8 A. Active desktop was a -- it's a set -- 9 it's a functionality that is available in 10 several of the components. 11 Q. Okay. So you can't draw it separately 12 because it's -- 13 A. That's correct. 14 Q. -- embedded in all that stuff? 15 A. Yes. It updated several components of 16 the system. 17 Q. In order for it to be functional, did 18 it have to be embedded in all that stuff? 19 A. No. 20 Q. Okay. Thank you. 21 MR. LAMB: Could we get the next 22 slide, please? 23 Q. Now, I want to shift gears a little 24 bit and talk about concept vaporware, the term 25 vaporware. 6681 1 In the industry, what does vaporware 2 mean, sir? 3 A. Well, vaporware is basically 4 nonexistent products, nonexistent software or 5 hardware products. 6 Q. Okay. What do you mean by that? 7 A. Well, it means software that doesn't 8 exist yet and might not ever exist. 9 Q. Okay. From a technological 10 perspective, how is vaporware used? 11 A. From a technological perspective, the 12 user community and the independent software 13 development community thinks about their 14 development plans both in terms of the present 15 functionality, the products that are available 16 today, as well as thinking about tomorrow and 17 where things are going. 18 So there is the idea that if you tell 19 developers that something is coming, that 20 there's a new platform that's going to be 21 available in a couple of months or a year, a 22 new product, then you should develop for that 23 product, even though that product isn't going 24 to be available for a long time. 25 What you do is you consume what is 6682 1 sometimes referred to as developer band width; 2 that is, the developers are thinking about and 3 working with and planning on developing 4 products for this technology that is not yet 5 announced or available, but simply talked about 6 as a future technology. 7 Q. Okay. And from a technological 8 perspective, how does the employment of 9 vaporware affect the common end user, the 10 consumer, the user of the PC? 11 A. Well, it gets the idea out that 12 there's a new product coming and that the 13 comparisons that people might normally wait to 14 see from the trade press, which computer should 15 I buy, what operating should I buy. There is 16 talk about waiting for the next product from 17 this company or that company. 18 In this particular case, wait until 19 Microsoft's DOS -- new version of DOS comes out 20 before making a decision. 21 So in our trade press, if the 22 vaporware has been successful and the trade 23 press, for example, has taken the idea, they 24 will recommend that decisions be deferred and 25 that people should wait until the new version 6683 1 of the software is out because it's going to be 2 great or it's going to do this or it's going to 3 do that. So there's a freezing effect on 4 potential acquisitions or potential purchases. 5 Q. Okay. 6 MR. LAMB: Could I get the next slide, 7 please? 8 Q. Does Microsoft have a definition for 9 vaporware, sir? 10 A. Yes. 11 Q. What is it? 12 A. It's on the slide up here. It comes 13 from the Microsoft press -- Microsoft computer 14 dictionary, the fifth edition. 15 It's software that has been announced, 16 but not released to customers. 17 Often it is software that it imagined 18 or in the minds of the marketing department and 19 not really a product that is within reach or 20 grasp of the store shelves or of people to 21 purchase. 22 Q. Okay. 23 MR. LAMB: Get the next slide, please. 24 Q. The Microsoft computer dictionary, the 25 fifth edition? 6684 1 A. Yes. 2 Q. How long has that been in press, do 3 you know? 4 A. Oh, I think I got -- the first copy I 5 used in maybe 1993, but maybe '91 is an earlier 6 edition. The fifth edition is maybe in '97 or 7 '98, I think. 8 Q. Okay. And in your experience and 9 based on your review of documents in relation 10 to this case, in your opinion, does Microsoft 11 employ vaporware? 12 A. I think the answer to that is yes. 13 Q. Okay. 14 A. In particular, the second sentence of 15 the definition. 16 Q. Which is? 17 A. The sarcastically existing in the 18 minds of the marketing department. 19 Q. And what is the impact on technology 20 when Microsoft employs that vaporware? 21 A. Well, Microsoft is a large company. 22 And lots of independent software vendors are 23 interested in what Microsoft's next product is 24 going to do. 25 So preannouncements of software 6685 1 technology that Microsoft might make will cause 2 the developers and the developer community to 3 focus their attention on the next Microsoft 4 product. 5 Q. Okay. 6 MR. LAMB: Could we have Exhibit 0411 7 underscore A, please, Darin? 8 Okay. There we go. Could you 9 highlight the to, from, and date line for us, 10 please? Can you get a little bit bigger? 11 Okay. 12 Q. Can you tell who this is from? 13 A. This is from Nathan M. or Nathan 14 Mhryvold. 15 Q. And again who was Nathan Mhryvold? 16 A. He was a senior executive at 17 Microsoft. 18 Q. Okay. And who is it to? 19 A. Bill G., that would be Bill Gates, 20 Brad Si, that would be Brad Silverberg. 21 Q. Who's Brad Silverberg? 22 A. Brad Silverberg was the head of the -- 23 I think the head of the desktop OS group at 24 that time. Recently hired -- I believe 25 recently hired into Microsoft from Borland. 6686 1 Q. Okay. Who's the next person? 2 A. Jeremy Bu. I'm -- 3 Q. You don't know that name? 4 A. No. 5 Q. Who's the next person? 6 A. Joachim Kempin. He was the head of 7 the OEM group. 8 Q. Next person? If you can tell. 9 A. I can't tell. 10 Q. What about the next person? 11 A. Paul Maritz. Paul Ma. 12 Q. Okay. And who, again, is Paul Maritz? 13 A. He was Brad Silverberg's boss. The 14 head of development. 15 Q. And the next person? 16 A. Riscpe. I believe that's a mailing 17 group within Microsoft. There were several 18 subscribers to the Riscpe. 19 Q. And the last Steve B., is that Steve 20 Ballmer? 21 A. That is. 22 Q. And who is Steve Ballmer? 23 A. Steve Ballmer was the -- I think at 24 that time he may have been the head of the -- 25 he was a senior executive of Microsoft. He's 6687 1 now the president, I believe. 2 Q. Okay. And the subject line is SPARC, 3 S-P-A-R-C, MIPS, M-I-P-S, and Compaq; correct? 4 A. Yes. 5 Q. Okay. Can you explain to the Jury 6 what SPARC is? 7 A. SPARC is the name that is given to 8 Sun's microprocessor architecture. 9 Q. Okay. What does that mean? 10 A. What does that mean? Well, yesterday 11 I talked a lot about Intel and Intel and AMD, 12 and they make a chip that -- they make chips 13 that are compatible with the X86 architecture. 14 X86 meaning it's sort of code name for 15 processor family, a family of microprocessors 16 that was the first one used in IBM's PC, the 17 8088 and 8286 used in the IBM PCAT and the 18 Compaq 386 and 486. 19 And today those are the survivors in 20 the Pentium and other Core 2 Duos. 21 So SPARC is like that family of 22 microprocessors, but not X86. Different 23 architecture. 24 Q. Okay. X86 is Intel? 25 A. X86 is Intel. 6688 1 Q. Okay. And then what we hear about now 2 is the Pentium and Progeny after that; right? 3 A. That's today, yes, from Intel. 4 Q. But SPARC was Sun's model of that? 5 A. Sun was incompatible with different 6 architecture for the design of microprocessors. 7 Q. Okay. And what did MIPS stand for? 8 A. MIPS was yet another different 9 architecture for the design of microprocessor 10 brains for -- in MIPS' case, for workstations 11 particularly. 12 MR. LAMB: Okay. Darin, if you could 13 go to the first couple of paragraphs and 14 highlight that for us. 15 Well, I don't know if we can read this 16 or not. 17 Q. Do you know what the nature of this 18 e-mail was about? 19 A. It was discussing, I believe, the 20 strategic alternatives for Microsoft with 21 respect to the workstation market. 22 Q. Okay. In relation to the workstation 23 market? 24 A. That's correct. 25 Q. Okay. 6689 1 MR. LAMB: If we could go back to the 2 screen, Darin, because the screen shows a 3 blowup of this Exhibit, 411A. 4 Q. Okay. So this is the e-mail from 5 Nathan Mhryvold to Bill Gates dated October 6 1st, 1990. And it says the purpose of 7 announcing early like this is to freeze the 8 market at the OEM and ISV level. 9 In this respect, it is just like the 10 original Windows announcement. This time we 11 have a lot better development team, so the time 12 between announce and ship will be a lot 13 smaller. Nevertheless, we need to get our 14 message out there. 15 We certainly do need to follow this 16 announcement up with a good demo in six to 17 eight months when the SDK ships, but 18 preannouncement is going to give Sun a real 19 problem. 20 Do you see that? 21 A. I do. 22 Q. Okay. And why do you believe that 23 this is vaporware? 24 A. Well, it's a strategic decision to 25 freeze the market as opposed to supply 6690 1 information that's necessary to plan and work 2 with the product. 3 Q. Okay. Well, technologically speaking, 4 what does it mean to freeze the market at the 5 OEM and ISV level? 6 A. Well, this perhaps requires a little 7 explaining on what workstations -- 8 Q. Sure. 9 A. Back in this time frame, there were 10 PCs, of course, and PCs were popular for most 11 business users and for most home users, but the 12 processing power of the PC wasn't enough to 13 handle engineering applications like 14 computer-aided design and other stuff. 15 So there was a separate kind of 16 computer that you could buy that was called a 17 workstation. And companies like Apollo, which 18 was purchased by HP, and Sun and MIPS and 19 Silicon Graphics were in the business of 20 selling those kinds of workstations to 21 engineering organizations and universities. 22 Microsoft was at the time considering 23 entering the market for these workstations. 24 And to do that it would need OEMs, people who 25 would -- companies that would build workstation 6691 1 computers that would use Microsoft's operating 2 system software. 3 And they would need independent 4 software vendors to take the applications that 5 already ran on these engineering workstations, 6 like auto desk -- if you've heard of auto desk, 7 which is a CAD/CAM computer-aided design, 8 computer-aided manufacturing product. 9 They would need to get them to support 10 the new workstation software platform and 11 hardware platform. And so that's the market 12 participants. Those are the OEMS and the 13 independent software vendors that Microsoft is 14 preannouncing its plans to get them to freeze 15 what they're thinking about doing for other 16 platforms and devote their attention to 17 Microsoft. 18 Q. Okay. 19 MR. LAMB: Could I get exhibit, 20 Plaintiffs' Exhibit 52 up, please, Darin? Can 21 you find the to, from line on this one? 22 I don't think that's the to, from 23 line. There's another one. Yeah, the bottom 24 one. 25 Q. That's from Nathan M., that's Nathan 6692 1 Mhryvold again. And it's -- 2 MR. LAMB: Whoop. Can't do that to 3 me, Darin. 4 Q. That's to Bill Gates; right? 5 A. Bill Gates, Carl Stork, I believe, 6 Paul Maritz and Steve Ballmer. 7 Q. Okay. Who's Carl Stork? 8 A. He's -- at the time, I'm not quite 9 sure. I think he was in the development 10 organization for Windows or for DOS. 11 Q. A Microsoft employee? 12 A. Yes. 13 Q. And then Paul Maritz and Steve 14 Ballmer? 15 A. Yes. 16 Q. Okay. 17 MR. LAMB: If we could go to the next 18 slide because it has a blowup that's easier to 19 read of this exhibit. 20 Q. Okay. This is an e-mail from Nathan 21 Mhryvold to Bill Gates January 5, 1989, 22 Plaintiffs' Exhibit 0052. 23 Quote, this reminds me of the Windows 24 versus VisiOn issue. The analogy isn't 25 perfect, but the situation was that we, parens, 6693 1 quote, we, end quote, is to be taken lightly. 2 I sure wasn't here, closed parens. 3 Preannounced Windows, signed up the 4 major OEMs and showed a demo to freeze the 5 market and prevent VisiOn from getting any 6 momentum. It sure worked. VisiOn died, 7 VisiCorp died, and DOS kept on chugging. 8 What was VisiOn? 9 A. VisiOn was the first WYSIWYG 10 application for the IBM PC. WYSIWYG is 11 what-you-see-is-what-you-get application. That 12 means things looked on the screen like what you 13 were going to get if you printed the document 14 out. 15 So you were -- today we take that kind 16 of for granted, but back in 1983 for an IBM PC, 17 this was a real breakthrough. The ability to 18 do full screen graphically oriented editing of 19 documents and spreadsheets, that was a great 20 breakthrough. 21 Q. Okay. We're going to try this again. 22 A. Sure. 23 Q. Can you spell WYSIWYG? 24 A. Okay. W, what; you, Y; see, S; is, I; 25 what, W; G, get. What you see is what you get, 6694 1 WYSIWYG. 2 Q. W-Y-S-I-W-Y-G? 3 A. Yes. 4 Q. WYSIWYG? 5 A. WYG. 6 Q. Got it. Okay. 7 Now, how is it that the 8 preannouncement impacted technologically what 9 VisiOn was doing? 10 A. Well, VisiOn was trying to get into 11 the market to become adopted both as a program 12 that customers used and customers purchased as 13 well as trying to get third-party developers to 14 develop additional software that would work 15 within the VisiOn environment. 16 That is to say that they would provide 17 additional functionality to VisiOn core 18 product. 19 Q. Okay. 20 MR. LAMB: Can we get the next slide, 21 please? 22 Q. I want to turn now to whether or not 23 in your professional opinion Microsoft 24 currently uses vaporware. And I want to turn 25 specifically to Windows Vista. 6695 1 Can you discuss with us and explain to 2 the Jury your opinion as to whether or not 3 Microsoft currently employs vaporware in this 4 regard, and, if so, how? 5 A. Well, the last Microsoft operating 6 system product that was released was Windows XP 7 for the desktop. 8 And in October, I believe, of 2001 -- 9 and Microsoft has finally shipped Windows Vista 10 to OEMs and in November of 2006, five plus 11 years since the last product, yet for the past 12 five years developers have been fed a large 13 amount of information about the forthcoming 14 product and told a lot of information about the 15 dates when that product would be available. 16 In fact, we were told to expect it in 17 2004, in 2004 second half, in 2005, 2005 second 18 half, 2006. Finally shipping at the end of 19 2006 with substantially different features and 20 functionality from the original product 21 description and with substantially different 22 functionality and features from what we were 23 told to expect in 2004, and even substantially 24 different functions from what we were told to 25 expect in June of 2006. 6696 1 So five months ago. Six months ago, 2 sorry. 3 Q. Okay. What do you mean by different 4 functionality, sir? 5 A. Well, I was talking about different 6 components and different capabilities before. 7 Windows Vista was -- it's code name was 8 Longhorn. And there's a Longhorn desktop code 9 name and a Longhorn server code name. 10 Windows Vista, the Longhorn desktop 11 software, was going to have a file system that 12 would be a feature or a function, a new file 13 system that would get rid of the idea of C 14 colon backslash. 15 You know, your traditional idea of 16 referring to a file using the C colon slash 17 file name dot extension and put it into this 18 sort of nonlocation based file idea, and that 19 was pulled from the functionality of the 20 software. 21 So features and functionality like 22 that that were available or to be available 23 shortly were removed. 24 Q. Okay. 25 MR. LAMB: If you could put up the 6697 1 browser timeline. 2 Q. Maybe you could designate and show for 3 the Jury the timespan that you just referred 4 to. 5 A. Sure. 6 What this is, just by way of 7 introduction, is a timeline of events, 8 especially major introductions of software, of 9 browser software. 10 Q. Okay. Just so the Jury understands, 11 as I see this, the picture on the top that 12 shows the far left-hand corner, there's a small 13 essentially timeline up on top, and then that's 14 just one block of it; right? 15 A. That's -- what you see at the bottom 16 is a segment of the entire timeline, which 17 appears in very small dimensions on the top, 18 that's correct. 19 Q. Okay. That's the beginning of the 20 timeline? 21 A. And it's moving from older to newer. 22 Q. Okay. And this portion of the 23 timeline, what does that show you in relation 24 to the web browsers and the activity in 25 relation to web browsers? 6698 1 A. Well, the timeline begins with the 2 first commercial browser availability, the 3 first commercial graphically oriented browser, 4 which Spygate -- Spyglass licensed from the 5 NCSA Mosaic folks. 6 And there follows Netscape, 7 introduction of its Navigator browser both in 8 beta and in final form. You can see October 9 1994 is the first event, followed by December 10 where Netscape Navigator is released along with 11 Netscape's server products. 12 MR. LAMB: Your Honor, would it be 13 possible for the witness to get down and stand 14 in front of that so he can just point to it? I 15 think it would be easier. 16 THE COURT: You may. 17 Q. Can you do that for us, Mr. Alepin? 18 A. Sure. Is there a pointer or -- 19 Q. Just come down and point, do that the 20 old-fashioned way with your hand. 21 A. All right. So here we are basically 22 the beginning of the browser. 23 Q. Is your mike turned on, Mr. Alepin? 24 A. You know, it's not. 25 Q. I get in trouble with the court 6699 1 reporter so that's why I'm -- 2 A. Let's see. 3 Q. There you go, sir. 4 A. Okay. So this is the beginning of 5 time insofar as browsers and commercial 6 browsers are concerned. 7 Here is the first release of 8 Netscape's Navigator in the market. And, in 9 fact, Netscape's events, Netscape product 10 releases are coded in blue flags going from 11 left to right over time. 12 You can see here Windows 95 and the 13 Internet Explorer 1.0 shipped to OEMs in July 14 of 1995 and actually is in the stores in August 15 of 1995. 16 And the events continue as both 17 companies are introducing new products and new 18 releases of their products and new features in 19 rapid fire succession from the beginning of the 20 timeline to the 1997 time period that's listed 21 here on this portion of the timeline. 22 Q. Okay. Mr. Alepin, who developed the 23 first Windows or Microsoft browser? It looks 24 like it's Windows 95 and IE 1.0. 25 A. Well, the first browser that was able 6700 1 to run on Windows, of course, was the Spyglass 2 NCSA, the Mosaic browser, and Netscape's 3 Navigator could run on the Windows platform as 4 well as 35 different other computer platforms. 5 So the Netscape Navigator could run on a 6 variety of different computers. 7 Q. Was IE 1.0 a clone then of Spyglass? 8 A. That was correct, yes. 9 Q. Okay. I want to move forward. We can 10 talk about the web issues a little bit later. 11 It seems like there's a lot of 12 activity in web design earlier than web 13 browsers; right, early on? 14 A. There's an awful lot of activity. 15 Lots of leap frogging of features and 16 functions. 17 MR. LAMB: Okay. And, Darin, if you 18 could go to the third block of time. 19 And now I think you need to go to the 20 fourth block of time. 21 Q. Down at the bottom. Do you see where 22 it says MS begins work on Vista, ship date of 23 2003? 24 A. I see that, yes. 25 Q. Okay. When did Microsoft show work. 6701 1 What does that show? 2 A. It says May of 2001. 3 Q. Okay. And then how long is it until 4 something actually happens? 5 A. I think you're going to have to go to 6 -- keep going. Keep going. Here we are in 7 October of 2006 where -- about five and a half 8 years, roughly, before we see Internet Explorer 9 7.0 shipping for the Windows XP. 10 Q. Okay. You can go ahead and take your 11 seat again, sir. 12 And if I understand you correctly, 13 basically throughout that period of time, 14 Microsoft continued to issue releases? 15 A. Microsoft continued to issue releases 16 of what, sir, I'm sorry? 17 Q. Well, excuse me. Basically, news 18 releases or press releases, it's coming shortly 19 type thing? 20 A. They did, yes. 21 Q. Okay. 22 MR. LAMB: If we could look at Exhibit 23 677 -- excuse me. Exhibit 7264. Plaintiffs' 24 Exhibit 7264. 25 Q. Okay. This is from Jim Allchin. Do 6702 1 you see that, sir? 2 A. Yes. 3 Q. And who was Jim Allchin? 4 A. I believe -- he's a senior executive 5 at Microsoft, and I believe in charge of the 6 development organizations. 7 Q. I'm being told you still need to get 8 closer to your microphone. 9 A. There. 10 Q. You can pull it up. There you go. 11 A. Yes. Well -- 12 Q. And it's to Bill Gates and Steve 13 Ballmer; right? 14 A. Yes. 15 Q. Okay. And this is dated January 7th, 16 2004; right? 17 A. Yes. 18 Q. Okay. Now, where is that in relation 19 to when they first starting work, when they 20 said they were first going to issue Vista and 21 when they finally issued Vista or released 22 Vista, I'm sorry? 23 A. It's about -- it would be about 24 halfway maybe. 25 Q. About halfway. 6703 1 A. A little more. 2 Q. And the subject here is losing our 3 way; right? 4 A. Uh-huh. Yes. 5 Q. And it goes on, this is a rant. I'm 6 sorry. 7 I am not sure how the company lost 8 sight of what matters to our customers (both 9 business and home) the most, but, in my view, 10 we lost our way. 11 I think our teams lost sight of what 12 bug-free means, what resilience means, what 13 full scenarios mean, what security means, what 14 performance means, how important current 15 applications are, and really understanding what 16 the most important problems our customers face 17 are. I see lots of random features and some 18 great vision, but that doesn't translate into 19 great products. 20 Okay. What is your understanding that 21 Mr. Allchin is referring to? 22 A. Well, those things like bug-free or -- 23 Q. No, no, no, I'm sorry. In general, 24 what's he referring to? 25 A. Oh, I believe he's referring to the 6704 1 direction of the Windows platform and the 2 Windows product for home and business users. 3 Q. The Vista product? 4 A. That would be the Vista product. 5 Q. Okay. Now, what does bug-free mean? 6 A. Bug-free is an attribute of software 7 that we all shoot for, and that is that 8 software that doesn't have any bugs. 9 Q. Okay. 10 A. Doesn't fail. 11 Q. What does resilience mean? 12 A. Resilience means that it can take a 13 punch and keep going. So you can do some 14 things to it that would -- that might 15 compromise its ability to continue to work, but 16 it would still keep going. 17 Q. Okay. What does full scenarios mean? 18 A. You have to think of computer software 19 in terms of how a user might use it from the 20 beginning to the end in order to accomplish 21 certain kinds of functions that they might want 22 to do. 23 Q. Okay. Mr. Alepin, what is your 24 understanding of what Mr. Allchin's role is in 25 either the architecture or development of Vista 6705 1 at this time? 2 A. He's a very senior executive 3 responsible for delivering on the product. 4 Q. On Vista? 5 A. On Vista, yes. 6 Q. Okay. So that's his job. Okay. 7 As you read that as a technologist, 8 what is your understanding of the status of 9 Vista at this time, January 7, 2004? 10 A. It wasn't ready, and it wasn't going 11 in the right direction. This is -- there's not 12 just this document. There are other documents 13 as well as other statements that suggest that 14 or confirm that Windows Longhorn, the code name 15 for Windows Vista, was not headed in the right 16 direction. 17 Q. Well, was Microsoft telling ISVs and 18 OEMs and end users that Vista was not heading 19 in the right direction? 20 A. No, it was not. 21 Q. What was it telling them? 22 A. That it was coming soon. 23 Q. Okay. It goes on to say, I would buy 24 a Mac today if I was not working at Microsoft. 25 If you run the equivalent of VPC on a Mac, you 6706 1 get access to basically all Windows application 2 software (although not the hardware). 3 What is VPC? 4 A. VPC is virtual PC, a product which 5 Microsoft acquired that -- ultimately acquired 6 that enables a user of a Macintosh to create a 7 virtual machine. 8 I talked yesterday about virtual 9 machines. It enables you to emulate the 10 hardware of a PC when running on a Macintosh. 11 And so virtual PC allows users of 12 Macintosh computers to load the Windows 13 operating system inside of the Mac operating 14 system and to run Windows applications. 15 Q. Okay. It goes on to say, Apple did 16 not lose their way. You must watch this new 17 video below. I know this doesn't show anything 18 for businesses, but my point is about the 19 philosophy that Apple uses. They think 20 scenario. They think simple. They think fast. 21 I know there is nothing hugely deep in this. 22 He goes on to say, I must tell you 23 everything in my soul tells me that we should 24 do what I called plan B yesterday. We need a 25 simple, fast storage system. 6707 1 What's a simple, fast storage system? 2 A. Well, it's a simple -- it's a way of 3 organizing information on media that is free 4 from complexity and overhead and other kinds of 5 problems that bedevil software, large complex 6 software products. 7 Q. Is that one of the attributes that 8 Microsoft said was going to be included in 9 Vista? 10 A. Yes. Yes. 11 Q. Okay. It goes on to say, LH is a pig 12 and I don't see any solution to this problem. 13 What is your understanding of HL? 14 A. Longhorn, LH. 15 Q. Vista? 16 A. Code name for the Vista product, yes. 17 Q. Okay. If we are to rise to the 18 challenge of Linux and Apple, we need to start 19 taking the lessons of scenario, simple, fast to 20 heart. 21 A. Yes. 22 Q. And it's your view that this is 23 indicative of vaporware used in relation to 24 Vista? 25 A. This is, yes, indicative. 6708 1 Q. One other question, sir, in relation 2 to VisiOn. And I want to make sure that I 3 understood this. 4 Was VisiOn the first commercial GUI? 5 A. VisiOn was the first commercial GUI 6 for them -- I'm sorry, for IBM PC. 7 Q. When you talk about simple, fast 8 storage system, how long does it take to 9 develop technologically a storage system such 10 as that? 11 A. Well, how long is a piece of string? 12 But in order to do it correctly and to 13 test it and to ensure that users' data is going 14 to be reliably stored, which is after all what 15 we're talking about here, that's what matters 16 to users, is not just being able to say that 17 it's fast, but it has to be accurate and 18 reliable and all that. 19 In order to test for those features 20 across a variety of environments, it's going to 21 take a long time, a lot of effort. 22 Q. What do you mean a long time? Can you 23 quantify that in terms of years or months? 24 A. Oh, software projects are measured 25 both in elapsed time as well as in man months, 6709 1 but it would take substantial amounts of both, 2 18 months, 24 months, something like that. 3 Q. Okay. 4 MR. LAMB: Is this a good time for a 5 break, Your Honor? 6 THE COURT: Sure. We'll take our 7 lunch break now. 8 Remember the admonition previously 9 given. Leave your notebooks here. 10 We'll see you back at noon. We are in 11 recess. 12 All rise. 13 (A recess was taken from 10:54 a.m. 14 to 12:01 p.m.) 15 THE COURT: You may resume the stand, 16 sir. You are still under oath. 17 THE WITNESS: Thank you. 18 MR. LAMB: Could I get the next slide, 19 Darin? 20 BY MR. LAMB: 21 Q. Good afternoon, Mr. Alepin. 22 A. Good afternoon. 23 Q. I want to change topics now and talk 24 about the term FUD, fear, uncertainty, and 25 doubt. 6710 1 Can you tell the Jury what that is 2 from a technological perspective? 3 A. Well, from a technological 4 perspective, FUD, fear, uncertainty, and doubt 5 means trying to create concerns or worries 6 about potential compatibility or 7 interoperability of a particular software or a 8 hardware product with another company's 9 hardware or software products. 10 Q. And why is it done in the industry? 11 A. Well, if you're successful with it, 12 what will happen is that people will not 13 purchase the product that is being -- about 14 which the concerns are being raised and instead 15 will purchase your product. 16 Q. And what impact on other technology 17 does that have? 18 A. Well, the concerns, if they achieve -- 19 if they rise to the level that they influence 20 the decision, that people won't buy the other 21 product, won't buy your product. 22 Q. And what impact does FUD have on ISVs, 23 OEMs, and ultimate consumers? 24 A. Well, FUD causes -- if it's 25 successful, FUD causes you to, if you're an OEM 6711 1 to lose sales to products that have or are 2 suggested as being more interoperable or more 3 compatible with some platform. 4 If you're an independent software 5 vendor, concerns are raised about whether your 6 product can continue to be interoperable or 7 compatible with the platform, for example, 8 going forward. And, for consumers, the idea is 9 to suggest that what they buy won't work with 10 future products from a company. 11 There's a certain amount of asymmetry 12 in the skills and the ability of people to 13 digest and determine whether technologies or 14 potential incompatibilities are significant or 15 not. 16 So if you can suggest it and it works, 17 then if you're listening maybe you can't 18 process that, maybe you can't understand how 19 important that particular feature or 20 interoperability or compatibility is going to 21 be. 22 Q. In your professional opinion, does 23 Microsoft engage in FUD? 24 A. Yes. 25 Q. Okay. FUD, the term, when did it 6712 1 originate or how did it originate? 2 A. Well, there are two sources that claim 3 credit for the term, for coining the term, not 4 necessarily using it, the first of which -- the 5 first of whom is Gene Amdahl, who was the 6 founder of Amdahl Corporation. 7 Gene Amdahl went out to create -- I 8 think I mentioned mainframe computers -- very 9 expensive computers that were compatible and 10 interoperable with IBM's mainframe computers. 11 Doctor Amdahl referred to certain 12 practices that were taking place where IBM 13 would suggest to customers that Amdahl's 14 products wouldn't be compatible with IBM's 15 mainframe operating system in the future or 16 IBM's disk drives or IBM's other computers. 17 So Doctor Amdahl called that kind of 18 practice FUD, fear, uncertainty, and doubt. 19 One of IBM's lawyers in the early 20 1980s, I believe, Tom Barr, also claimed credit 21 for describing that same practice as FUD. 22 Q. Okay. And that term FUD, is that term 23 commonly used in your industry? 24 A. Well, we're all aware of it, and we 25 know it when we see it. 6713 1 Q. And based on your experience and your 2 review of documents in this case, is FUD 3 something that has been employed by Microsoft? 4 A. Yes. 5 MR. LAMB: Call up Exhibit 5401, 6 please. Go to the to, from line. 7 Q. This is from Brad Si. That's Brad 8 Silverberg? 9 A. Brad Si, Brad Silverberg. 10 Q. And who is that again? 11 A. He was the head of the development of 12 a -- he was a senior executive, head of the DOS 13 and I believe the Windows development teams at 14 Microsoft. 15 Q. Okay. And then it's to Sam T. Do you 16 know who that is? 17 A. I'm afraid not. 18 Q. Okay. And then it says re: DR-DOS, 19 will they/won't they buy, and the date is 20 October 23rd, 1991. 21 MR. LAMB: Can you go, Darin, to the 22 first part of that exhibit so we can take a 23 look at it? 24 Q. Okay. 25 A. Yes. 6714 1 Q. Do you know what he's talking about 2 here, what subject matter he's talking about? 3 A. The subject matter is DR-DOS, which 4 was an operating system that was compatible 5 with MS-DOS and other products from Microsoft. 6 And the they is the public, will consumers 7 purchase. 8 Q. Okay. 9 MR. LAMB: Why don't you pull up the 10 next screen, Darin, because that gives a better 11 view of that exhibit. 12 Q. Okay. And here Mr. Silverberg says, 13 we need to create the reputation for problems 14 and incompatibilities to undermine confidence 15 in DR-DOS 6. So people will make judgments 16 against it without knowing details or facts. 17 Do you see that, sir? 18 A. I do. 19 Q. And in your professional opinion, is 20 that an example of FUD? 21 A. Yes. 22 Q. Okay. Where it says 23 incompatibilities, what does that mean, 24 incompatibilities? 25 A. Basically, it says that DR-DOS 6.0 -- 6715 1 I'm sorry, in this particular example or 2 generally incompatibilities? 3 Q. Just generally. 4 A. Oh, generally. Incompatibilities are 5 where a particular software or hardware 6 component can't work with another hardware or 7 software component in all the ways that it's 8 intended to work. 9 Q. Okay. In relation to DR-DOS 6 10 specifically, what is this concept of 11 incompatibilities? 12 A. Well, what would be of concern to 13 you -- what incompatibilities would be of 14 concern to the purchaser of DR-DOS, which was 15 an operating system that could substitute for 16 MS-DOS? You would be concerned about whether 17 it would run all of your applications. 18 So incompatibilities would be could it 19 run your games, could it run your Lotus 1-2-3, 20 could it run those kinds of applications, could 21 it run other system utility software, could it 22 run Microsoft's software. 23 Microsoft had Windows. Microsoft had 24 developer tools. And it also had a variety of 25 applications. 6716 1 Q. Okay. And, in reality, were there 2 such problems and incompatibilities? 3 A. They were some incompatibilities. 4 Q. Okay. Did they rise to the level 5 where they wouldn't work on that operating 6 system, where they were incompatible? 7 A. There were like any piece of software. 8 There were issues. There were 9 incompatibilities between MS-DOS 5.0 and 4.0, 10 for example. 11 There were incompatibilities that were 12 resolved. So no -- the answer to your question 13 is there were incompatibilities. Were they the 14 kind that would have or should have created a 15 concern such as undermining confidence? No. 16 Not in my view. 17 Q. Okay. So they were resolvable? 18 A. Easily, yes. 19 MR. LAMB: Okay. Go to Exhibit 0425, 20 Darin. 21 Q. This is from W-Carrin on Monday, 22 October 15th, 1990 to Brad Si again. Brad Si 23 is Brad Silverberg. 24 A. That's correct. 25 Q. And do you know who W-Carrin is? 6717 1 A. W hyphen is the prefix for e-mail from 2 Weggener Edstrom employees. 3 Q. What does that mean, Weggener Edstrom 4 employees? 5 A. Microsoft's public relations firm was 6 called Weggener Edstrom. 7 Q. Okay. All right. And this subject is 8 getting the word out about DR-DOS. 9 MR. LAMB: Now, why don't you go to 10 the screen, Darin, because that shows a clearer 11 copy of this exhibit. 12 Q. Okay. So this is from Microsoft's PR 13 firm to Brad Silverberg, a senior executive; 14 right? 15 A. That's correct. 16 Q. Okay. And it says, quote, informally 17 plant the bug of FUD in their ears. Have you 18 heard about problems with DR-DOS? We'll do 19 this very tactfully. If Digital Research came 20 to Microsoft for help making DR-DOS work with 21 Windows, would Microsoft help them? Maybe not? 22 End quote. 23 Is that an example of FUD, in your 24 opinion? 25 A. It is. 6718 1 Q. Why? 2 A. Well, it's suggesting the potential 3 for incompatibilities which might occur. And 4 it's suggesting further that Microsoft as the 5 owner of Windows might not do something to 6 resolve a problem that occurred between the 7 DR-DOS product and the Windows product. 8 MR. LAMB: Okay. With the Court's 9 permission, can he get down and do a diagram of 10 DOS and DOS and Windows and how they interact 11 during this time period? 12 THE COURT: Yes. 13 MR. LAMB: Thank you, sir. 14 A. Am I on? 15 Q. We're on. 16 A. Good. So in this time, and beginning 17 from 1985 going forward until 1995, you would 18 get a copy of MS-DOS or PC-DOS, and that would 19 be separately purchased, separately acquired. 20 And you would also purchase a separate copy of 21 Windows. 22 Now, Digital Research introduced a 23 DR-DOS, which was a work alike for MS-DOS and 24 you could do the same thing. Essentially, you 25 could take the same copy of Windows and you 6719 1 could install it with DR-DOS and DR-DOS would 2 make available to Windows and to Windows 3 applications the same interfaces that the 4 MS-DOS program made available to Windows. 5 So it would work alike. You wouldn't 6 have to make any changes to your Windows 7 software and you wouldn't have to purchase 8 another copy or a different copy that was 9 specific to DR-DOS. 10 Q. Okay. Now, DR-DOS was owned by a 11 company different from Microsoft; right? 12 A. DR-DOS was the creation of a company 13 called Digital Research, Inc., Incorporated. 14 Q. Okay. We'll talk more about DR-DOS. 15 But MS-DOS, who was MS-DOS owned by? 16 A. Well, MS-DOS is Microsoft DOS. 17 Q. Okay. And at this point in time, 18 Windows as an operating system doesn't exist; 19 right? 20 A. Windows as an operating system does 21 not exist, that's correct. 22 Q. Okay. Now, if I understand you 23 correctly, there's a requirement from MS-DOS to 24 Windows that MS-DOS provide interfaces to 25 Windows so that Windows can run on MS-DOS; 6720 1 right? 2 A. That's correct, yes. 3 Q. Okay. And the same is true for DR-DOS 4 and Windows; right? 5 A. That's correct. 6 Q. Okay. Now, what was it that Microsoft 7 was doing or not doing such that Windows had a 8 problem running on DR-DOS, or did it? 9 A. Well, in this -- with reference to 10 this particular e-mail, the suggestion was not 11 that it didn't work. In fact, Windows did 12 work. 13 The idea here is to suggest that if in 14 the future something happened or something was 15 discovered, that meant that this interface 16 worked in a different way from the same 17 interface that DR-DOS was providing; that 18 Microsoft wouldn't do anything to help diagnose 19 or repair the problem or help Digital Research. 20 Even though it's the same customer, 21 even though it's a customer of Microsoft, even 22 though it's a Windows customer, that they would 23 not get any help from Microsoft to fix a 24 problem that was detected between Windows and 25 DR-DOS. 6721 1 Q. Okay. So if sometime in the future 2 there's a problem and it arises, we're not 3 going to help? 4 A. That's the idea behind the suggestion 5 planting the ears -- that it might, so you're 6 uncertain. You have doubt about whether you'll 7 be able to overcome the incompatibility if such 8 incompatibility were to arise. 9 Q. Okay. And what technologically is the 10 impact of the creation of that type of doubt on 11 ISVs and OEMs? 12 A. Well, the concern is that you're not 13 going to get the same measure of assistance, 14 same measure of technical information if you 15 develop your software as an ISV using DR-DOS or 16 working with DR-DOS as you would if you were 17 working with Microsoft's MS-DOS. 18 Q. And what is the impact on the end 19 user? 20 A. On end users, it's the same issue. 21 It's magnified more, however, because of what I 22 talked about before, that this asymmetry in 23 skill levels. 24 And users are in much less of a 25 position to evaluate technological problems. I 6722 1 mean, it's not -- for most users, end users, 2 the idea of fixing a software problem is 3 restarting the computer, which surprisingly 4 enough works often. 5 However, for independent software 6 vendors, they are more able to limit the 7 possible numbers of errors or potential sources 8 of errors. 9 But, for users, incompatibilities with 10 a potential of incompatibilities makes the 11 proposition of purchasing a piece of software 12 that has this FUD label attached to it a far 13 riskier proposition. 14 Q. Okay. Is DR-DOS as an operating 15 system commercially available today? 16 A. You know, it may be available for a 17 few pennies, for very specific applications, 18 but it's no longer available as a commercial 19 piece of software in the sense that anyone -- 20 any one of us here in the room would consider 21 or find it available for user installation. 22 Q. Okay. Go ahead and take your seat 23 again, sir. 24 A. Thank you. 25 MR. LAMB: Could I have the next 6723 1 slide, Darin? 2 Q. I think if you leave that mike on, 3 you're okay and you don't need the other mike 4 on. 5 MS. CONLIN: Will it scream? 6 MR. LAMB: Will it what? 7 MS. CONLIN: Will it scream? 8 MR. LAMB: I have no idea. It's 9 beyond my technical capability. 10 Does that work? They are nodding 11 their head yes. 12 A. Maybe I should try speaking. That 13 would help. 14 Q. All right. 15 A. Okay. 16 Q. If it screams, please turn it off and 17 we'll go back, okay. 18 Part of the opinions that you 19 expressed earlier related to alternative 20 worlds. 21 Could you tell the Jury what you mean 22 by that? 23 A. Well, in a technical sense now, 24 looking at the possible options, sort of viable 25 technological alternatives is what I'm really 6724 1 talking about. So what could we have done at a 2 point in time with the technology that we had. 3 Could we have created a viable 4 operating system alternative to MS-DOS, for 5 example? We created graphical user interface 6 alternatives as a technical matter to Windows. 7 That's what I meant by alternative worlds. 8 Q. And in relation to operating systems, 9 do you have an opinion in relation to 10 alternative worlds in a technical sense but for 11 the conduct of Microsoft as you've described 12 over the last day and a half? 13 A. Yes. 14 Q. Okay. Could you tell the Jury what 15 that is? 16 A. I think that there are -- I believe 17 that there are alternatives that could have 18 arisen based on technology that we had absent 19 certain things that Microsoft did, some of 20 which I've already talked about. 21 And those alternatives were kind of 22 the equivalent of having a tire iron in a 23 bicycle spoke. 24 Q. What do you mean by that? 25 A. Kind of hook the technology and change 6725 1 the basis on which that was being evaluated and 2 considered in the market from the merits of the 3 product and the technology to something 4 different. 5 Q. Okay. And what alternative operating 6 systems are you referring to that would have 7 been technologically viable but for Microsoft's 8 conduct? 9 A. Well, in the early 1990s, we had 10 DR-DOS. We've just been talking about that. 11 We had IBM's OS/2 operating system. 12 We had Be, B-e, Corporations operating 13 system. 14 We had a GO pen tablet operating 15 system environment. 16 We had -- we've have had Linux, of 17 course, and the Mac. 18 But the ones that were compatible on 19 the PCs would be the Be operating system, the 20 OS/2, and DR-DOS is the primary focus. 21 Q. Okay. How about applications? What's 22 the impact of applications? 23 A. The impact of applications is that 24 there were alternative applications that could 25 have become more than just applications. They 6726 1 could have become their own separate platforms 2 that would have served as the basis for 3 development of an entirely different 4 alternative to the current Windows operating 5 system that we find today. 6 Q. Okay. Such as? 7 A. Well, one of which is -- and this was 8 something that Microsoft executives observed -- 9 Lotus Notes, it was a software known in the 10 category of group or collaborative software. 11 And users could spend virtually all of 12 their time inside this application, which 13 included e-mailing and word processing and 14 scheduling and document sharing, without ever 15 leaving the application to get into the 16 operating system. They spent all of their time 17 inside the application. 18 And Lotus provided programming 19 emphasis so that other missing pieces in the 20 groupware or collaborative application could be 21 built by third parties. 22 So, ultimately, a user would have no 23 reason to ever do anything but to sit inside 24 this application called Lotus Notes and do 25 anything else. Never see the operating system. 6727 1 Never see anything other than Lotus Notes and 2 be perfectly happy. 3 Q. Okay. Let's stop for a second. 4 You say never see the operating 5 system. Technologically speaking, what's the 6 significance of that concept, never seeing the 7 operating system? 8 A. Well, if you never see the operating 9 system, a couple of things happen. First of 10 all, the first one is that you don't need to be 11 trained in how to use it. So you don't invest 12 any time or effort in the operating system. 13 You don't care really about what 14 operating system you run because everything 15 that you need is in the layer above that. 16 Everything you need is in your Lotus Notes 17 collaborative application. 18 Q. So the focus is on the applications? 19 A. Focus is on the business application, 20 yes. 21 Q. Okay. Were there impacts, in your 22 opinion, in relation to alternative worlds as 23 to browsers but for Microsoft's conduct? 24 A. Yes. 25 Q. Okay. Can you explain that to the 6728 1 Jury? 2 A. Well, the great thing -- I mean, there 3 are a lot of great things about browsers, but 4 the really great thing about browsers was that 5 they allowed you to go anywhere and get 6 content. 7 And also they provided a platform, a 8 potential platform initially, but a real 9 platform afterwards, for executing programs, 10 applications. And that had the potential to 11 provide a complete environment in which you 12 spent all of your time doing everything that 13 you needed to do, e-mail, collaboration, 14 writing documents, spreadsheets, everything 15 inside a browser window. 16 Again, you wouldn't ever see the 17 operating system because everything you needed 18 would be inside the window that is your browser 19 window. And that could run on any computer 20 from a kiosk in an airport to a network 21 computer, a specialized computer, to your PC, 22 to a Mac. It would be transparent. 23 Q. Okay. And has this had an impact, in 24 your mind, the conduct of Microsoft, in 25 relation to potential alternative worlds as 6729 1 they pertain to network computers and Java? 2 A. Yes. 3 Q. Okay. Can you explain that to the 4 Jury, please? 5 A. Perhaps I need to describe what a 6 network computer is. 7 Q. Please do. 8 A. Okay. PCs cost a lot of money. They 9 cost a lot more money to operate than they do 10 the initial purchase. This is especially true 11 for businesses where you have to maintain the 12 computer and update it and install software and 13 what have you. 14 Some companies in the mid-1990s, after 15 the Internet came on the scene and Sun's Java 16 technology came on the scene, said it would be 17 nice if we could create a computer that was 18 basically a CPU, a brain, and some memory. And 19 it could get its applications from a server and 20 you'd never have to maintain it. 21 All you'd have to do is update the 22 applications on the server and then everyone 23 who was connected to this server, whenever they 24 used a network computer, would be able to get 25 the most recent copy of the application fully 6730 1 maintained and ready to go. 2 Q. Okay. So the actual network computer 3 doesn't have an operating system. It uses the 4 operating system from the server? 5 A. No. The network computer system -- 6 the network computer would use a Java Virtual 7 Machine kind of operating system. 8 Q. Okay. So it doesn't have an operating 9 system like Windows? 10 A. It doesn't -- for practical purposes, 11 for what we think of in terms of an operating 12 system, the operating system would have been 13 the Java Virtual Machine. 14 Q. Okay. Maybe you could draw that. I 15 thought you explained the Java Virtual Machine 16 was more like middleware. 17 A. Well, the Java Virtual Machine has the 18 potential to be both -- 19 MR. LAMB: Can he get up and draw 20 that, Your Honor? 21 THE COURT: Sure. 22 MR. LAMB: Thank you. 23 A. It has the potential to be both 24 middleware and that is -- going back to my 25 diagram before. And here we have the OS. 6731 1 Here we have the Java Virtual Machine 2 and the interfaces. And here we have the 3 application. 4 So this is in Java's role as a 5 middleware piece. What Java is doing is hiding 6 from the application any information about the 7 type of operating system that the application 8 is running. So it insulates all of these 9 interfaces from the application. 10 Q. And this is where -- I don't want to 11 say the operating system is irrelevant, but 12 it's interchangeable, could be any operating 13 system? 14 A. It's interchangeable, yes. 15 Q. Okay. But when you're talking about a 16 network computer, what does a network computer 17 look like? 18 A. A network computer simply removes that 19 line. 20 Q. Okay. So there's no operating system 21 below? 22 A. The Java Virtual Machine performs the 23 functions of an operating system effectively. 24 Q. All right. Thank you. 25 Mr. Alepin, in relation to the 6732 1 technological impact on media players of 2 Microsoft's conduct, do you have an opinion as 3 to alternative worlds but for that conduct by 4 Microsoft? 5 A. Well, this -- the media player is -- 6 so that we're on the same page here, a media 7 player is like our iTunes. People are familiar 8 with iTunes or Real player or Windows Media 9 Player. They're both a face on which you can 10 store music, purchase music at music stores. 11 That's one element that people think 12 about when they think about media players. 13 That's just the top level face that you see. 14 But underneath there is middleware 15 that provides application programming 16 interfaces that enable other software to 17 connect and operate and to make use of the 18 facilities that a media player needs, including 19 the playing of video, the recording of video, 20 the playing of audio, audiotape or audio 21 tracks, that kind of stuff. 22 Q. Okay. And has Microsoft's conduct had 23 an impact on media players? 24 A. It has, yes. 25 Q. Okay. And what alternative worlds do 6733 1 you perceive but for that conduct? 2 A. Well, media players have a potential 3 to occupy different niches within the range of 4 product areas that as a technical matter a user 5 might need a computer for. I mean, you might 6 need a computer for handling your entertainment 7 center. 8 You might need a computer -- but a 9 different kind of computer, not a spreadsheet 10 kind of computer, but a computer that does a 11 really good job of managing your entertainment 12 center and connects you to the outside world to 13 be able to download media tracks and to manage 14 your recording -- your CDs and what have you. 15 That potential area would have 16 required at least some ability to connect with 17 and interoperate with personal computers that 18 you use in your business and the rest of your 19 life. 20 Q. Thank you, Mr. Alepin. 21 MR. LAMB: Could I get the next slide, 22 please? 23 Q. Now, what I want to do is I want to 24 shift gears a bit. 25 We've talked about a lot of the 6734 1 history over a period of time, but you've 2 prepared a couple of slides to focus some key 3 concepts. 4 And on this slide you have the phrase 5 PC operating source software and applications 6 software in 1980s. Ownership of operating 7 system/platform did not convey significant 8 technological advantage. 9 Can you explain to the Jury what you 10 mean by that, during that time period in the 11 '80s? 12 A. In the 1980s, from the advent of the 13 first personal computer, the operating system 14 itself didn't do an awful lot. 15 Applications were responsible for 16 performing most of the functions that they 17 needed. In fact, it was often times you had to 18 -- as an application developer, you had to get 19 rid of the operating system, make it go away so 20 you could accomplish all the things that you 21 wanted to do with the computer. 22 And, in that sense, it didn't matter 23 who owned the operating system. It was what 24 the applications could do that really mattered. 25 Q. Okay. Is there a way that you could 6735 1 diagram that so you could explain that to the 2 Jury? 3 MR. LAMB: If I could, Your Honor. 4 A. Well, this is -- when I talked about 5 early computers at some point yesterday, I 6 described this idea that the earliest 7 application software contained all of the stuff 8 that you needed in order to run a computer. 9 To boot the computer, the bootstrap 10 computer, the software that controlled the IO 11 interfaces and what have you, as well as the 12 software to control memory. 13 There was, in fact, no other 14 application running, so memory management was 15 really easy. Plus we used to have 8K 16 computers. We now have gigabyte computers. So 17 there's not a lot of memory to manage. 18 And what happened over time was that 19 this functionality that existed in each 20 application became subroutine first so that 21 different applications could use the same 22 subroutines. They were separate from the 23 application. 24 Later that became a single operating 25 system that allowed multiple applications to 6736 1 use it. 2 In the mid-1980s, the operating system 3 performed only this many functions. 4 As time passed, the operating system 5 grew to perform more functions. But in the 6 1980s, the limited amount of functions 7 performed by the operating system presented 8 little in the way of control or domination, if 9 you will, of the -- little control over the 10 application, initial application. 11 Q. Okay. The slide says lots of 12 alternatives, lots of innovation. 13 Can you explain to the Jury what you 14 meant by that? 15 You can take your seat again, sir. 16 Thank you. 17 A. Thank you. 18 Well, in this time frame there were 19 just a large variety of applications that were 20 available in each product category. 21 So, for example, if you were 22 interested in a word processor in 1985 or 23 thereabouts, you could choose Microsoft Windows 24 -- I'm sorry, Word or DOS, WordPerfect, Word 25 Star, X Y Right, Multi Plan, and the list goes 6737 1 on in terms of word processing applications. 2 There were easily a dozen of these 3 word processing applications. And each one of 4 them was introducing new functions and features 5 in reasonably short time frames. Very short 6 time frames, in fact. 7 Q. Okay. And what was the pace of 8 innovation technologically at that time period? 9 A. Well, as a result, you saw people -- 10 independent software vendors matching the 11 functionality of the last company to introduce 12 a product, and then improving on that 13 functionality. 14 So it was a very rapid pace of change 15 and introduction of new technologies. 16 MR. LAMB: Could I get the next slide, 17 Darin? 18 Q. Okay. So Microsoft wasn't originally 19 a company with an operating system; right? 20 A. Way back when, Microsoft was not an 21 operating system company, no. 22 Q. Okay. When you say way back when, 23 what do you mean? 24 A. Oh, I think when Microsoft was formed, 25 which I believe was 1975. 6738 1 Q. Okay. What type of company was it 2 originally? 3 A. I believe it was a -- easiest category 4 would be a development tools or developer tools 5 company. 6 Q. Okay. What does that mean? 7 A. Yesterday I mentioned that to develop 8 software, you need developer tools. You need 9 different sets of for developers applications. 10 Much like business people need business 11 applications, developers need special kinds of 12 applications that enable them to write software 13 and to do so in an efficient way. 14 We call this category of stuff 15 developer tools. And developer tools include 16 compilers and interpreters. These are special 17 software programs that read source statements 18 written according to a specific programming 19 language and translate them into the actual 20 instructions that the computer is going to 21 execute. 22 So they take what you and I can 23 understand, given, of course, that it's in a 24 very specific dialect. 25 So if then else kinds of stuff, and 6739 1 they translate that into binary information 2 that a computer says, oh, you mean if then 3 else. 4 Q. Okay. What does that mean, binary 5 information? 6 A. Well, zeros and ones is binary 7 information. So computers have like -- they 8 build off of zero and one. That's all that's 9 in there, is a zero and a one. We'll talk 10 about that later, I think. 11 But zero and one is on and off. So 12 it's like a switch. And there are millions of 13 these switches. And we rely on whether it's on 14 or off to make decisions. 15 Q. Okay. So Microsoft didn't have an 16 operating system at that time? 17 A. Did not. 18 Q. And in order to do what it needed to 19 do in terms of these developer tools, did it 20 have to employ an operating system or use an 21 operating system? 22 A. Well, this was a very early and 23 primitive stage in computers. They weren't 24 personal computers. It needed to use an 25 operating system, although versions of basic 6740 1 could actually operate without an operating 2 system. So it was very primitive. 3 Q. Okay. What was the first operating 4 system that Microsoft used? 5 A. It was -- the first operating system 6 that Microsoft -- I'm sorry? 7 Q. Used in terms of Windows. 8 A. I apologize. I spoke over you. 9 Q. Okay. What operating system did 10 Microsoft use? 11 A. Microsoft used the CP/M in the early 12 -- you're referring to 1975 to 1980? 13 Q. Well, what was Microsoft's first 14 operating system? 15 A. Microsoft's first operating system was 16 DOS. 17 Q. Okay, DOS. And where did they get it? 18 Did they write it? Did they get it from 19 somebody? How did they get it? 20 A. I believe they got it from a company 21 called Seattle Computing, which was run by a 22 person named Gary Paterson. 23 Q. Okay. So Microsoft didn't write its 24 first operating system? 25 A. That's my -- that's right, yes. 6741 1 Q. In these early stages in relation to 2 technology and technology advancements, what 3 position was Microsoft in relation to other 4 companies that Microsoft was competing with 5 technologically? 6 A. In? 7 Q. In this time period in the '80s. 8 A. In this time period in relation to the 9 operating systems? 10 Q. No. In relation -- well, they didn't 11 have an operating system; right? 12 A. That's right. 13 Q. So in this time period they are 14 competing with other companies regarding 15 technology; right? 16 A. That's correct. 17 Q. And how were they doing it? I mean, 18 what was their relative status? 19 A. They were a small company. 20 Q. Okay. I'm talking about 21 technologywise. Were they in the cutting edge? 22 Were they in the leading edge? Were they 23 behind the eight ball? Were they right in the 24 middle of the pack? Where were they? 25 A. They were right perhaps in the middle 6742 1 of the pack in terms of technology. Not ahead. 2 Q. Okay. 3 MR. LAMB: Can I get the next slide, 4 please? 5 Q. Okay. This slide lists some word 6 processing software that the Jury may or may 7 not be familiar with. Could you just describe 8 what each one of these products were for them 9 briefly? 10 A. WordPerfect was the most popular word 11 processing software in the 1980s and into the 12 early 1990s. 13 Samna was -- I believe it had a 14 product called ME and ME Pro, and I believe it 15 was the first graphical word processing 16 software for Windows, but it may have been the 17 second. So it was a word processing software. 18 Wang was, of course, as I described 19 yesterday, it was word processing software that 20 was widely used by small businesses and law 21 firms and the like. 22 Microsoft had Microsoft Word and later 23 Microsoft Word for Windows. 24 Q. Okay. So at what point in time -- at 25 one point in time there were relatively many 6743 1 word processing software applications; correct? 2 A. That's correct, yes. 3 Q. Okay. And during that time period, in 4 the early days, was Microsoft the dominant 5 technology? 6 A. No. 7 Q. At some point in time, did they become 8 the dominant technology? 9 A. They did, yes. 10 Q. When was that, sir? 11 A. In the 1992-93 time frame. 12 Q. And are they the dominant technology 13 now? 14 A. Yes. 15 MR. LAMB: Next slide, please. 16 Q. Okay. This lists various spreadsheet 17 applications. If you could just take a moment 18 and describe these for the Jury and the 19 companies that they came from and what they 20 did. 21 A. Well, Lotus, Lotus 1-2-3. VisiCalc, 22 that first spreadsheet. Borland had a product 23 called Quattro. Informix and Ashton/Tate had 24 Multi Plan, and Javelin was also a word 25 processor. Sorcim Computer Associates. I'm 6744 1 sorry, Javelin was also a spreadsheet. Sorcim 2 Computer Associates had SuperCalc. Paperback 3 had its own spreadsheet software that was a 4 work alike for Lotus 1-2-3. 5 Microsoft had Multi Plan and later had 6 Excel. 7 Q. Okay. But in the early days, it had 8 Multi Plan; right? 9 A. It had Multi Plan, that's right. 10 Q. Okay. So in the early days there were 11 many spreadsheet applications; right? 12 A. Many, many. 13 Q. At that point in time, was Microsoft a 14 dominant technology in relation to spreadsheet 15 applications? 16 A. Not at all. 17 Q. At one point in time, did Microsoft 18 become the dominant technology? 19 A. They did. 20 Q. When was that, sir? 21 A. In the early 1990s. 22 Q. And are they now? 23 A. They have been. 24 MR. LAMB: Next slide, please. 25 A. Excuse me. I realize I may have 6745 1 misspoke. I meant when I said Multi Plan, not 2 with relation to Microsoft, but with relation 3 to another company. I meant Multi Mate. 4 Q. Multi Mate. 5 A. Sorry. 6 Q. All right. 7 A. Multi Plan was Microsoft's product. I 8 think it's actually Multi Mate is the 9 application software from Ashton/Tate and Multi 10 Plan was the application software from 11 Microsoft. I may have said them incorrectly. 12 Q. Okay. The next slide lists operating 13 systems, and these are earlier operating 14 systems. 15 Can you just describe those for the 16 Jury so they get a sense of who made them and 17 during what time period they existed or were 18 really technologically viable? 19 A. Sure. The DOS or MS-DOS as it came to 20 be known began in 1981 up through the -- up 21 through 1995, although there was a period where 22 DOS was supposed to be dead or was announced to 23 be dead. That would have been in the 1987 time 24 frame. 25 DR-DOS was a product from Digital 6746 1 Research that we talked about before. Digital 2 Research had a couple of versions previous to 3 the DR-DOS 5.0 and 6.0 that were really 4 commercially viable products in terms of 5 capabilities and acceptance. 6 Q. I'm going to ask you to speak up 7 again, sir. I know it's getting into the 8 afternoon. 9 A. Okay. I may be heading for the barn 10 there. 11 Q. Okay. 12 A. The 2 p.m. barn. 13 Q. Okay. 14 A. Or 1 p.m. barn. 15 OS/2. OS/2 was originally a joint 16 development project between Microsoft and IBM 17 to create the second generation of operating 18 systems, OS/2, that would follow on from DOS. 19 That project began in the mid-1980s 20 and became a product in the marketplace in the 21 late 1980s. IBM took over full responsibility 22 for it in the early 1990s. And it, I think, 23 kind of disappeared from the market in the 24 mid-1990s. 25 Q. How about Be? 6747 1 A. Be is a company -- is an operating 2 system that started off in life targeting a 3 different architecture, but now -- but then 4 turned to become compatible, a PC compatible 5 operating system. It could run on the same 6 kind of computer as MS-DOS or OS/2. 7 Windows introduced -- introduced in 8 late 1985, a series of improvements over time. 9 Finally, bundled and technologically tied 10 together with DOS version 7 as a practical 11 matter in 1995, and has now gone through 12 Windows 95, 98, XP, 2000, and Vista 13 generations. 14 And Linux, the operating system that 15 came from Linus or Linus Torvalds and is now 16 available for download off the Internet. 17 Q. Okay. So at one time there were many; 18 right? 19 A. At one time there were many, yes. 20 Q. Okay. And in those early days, was 21 Microsoft the dominant technology in relation 22 to operating systems? 23 A. Well, dominant, the prevailing? 24 Q. Yes. 25 A. Perhaps the prevailing one, yes. 6748 1 Q. Yes. Were they? 2 A. Yes. 3 Q. In the early days? 4 A. Yes. 5 Q. And are they dominant now? 6 A. Yes. 7 Q. Okay. Now, Linux, that's an open 8 source code; right? 9 A. That's correct. 10 Q. Okay. Can you explain for the Jury 11 what that means? 12 A. Okay. Open source -- I think I 13 touched on this yesterday. 14 Open source is a software -- the 15 software for which the source code of the 16 software is available to anyone and everyone 17 and which is developed by community effort. 18 So people come together electronically 19 and work on the development of the open source 20 software projects to get the products into the 21 hands of users. 22 So if you want to make a change to 23 something and make the software do something 24 different and you're capable of programming in 25 in whatever programming language they use, you 6749 1 can do that. 2 Q. Okay. Technologically, does that 3 enhance or stifle competition? Not 4 competition, but technological advancement? 5 A. Open source stimulates. 6 Q. Stimulates. 7 A. Stimulates the innovation. You have 8 millions of people potentially who can 9 contribute, and hundreds and thousands of ideas 10 about how to move the products or technologies 11 forward. 12 MR. LAMB: Could I get the next slide, 13 please? 14 Q. I want you to take some time here and 15 explain to the Jury the concept of open 16 architecture or open standards and the relation 17 of cooperation, what that means and what the 18 effect is technologically. 19 A. In our industry, the products that we 20 build and sell work together with other 21 products. There are very few companies who 22 today could -- or, I mean, there are no 23 companies today who are in the position that 24 IBM was, let's say, in the 1960s where it could 25 sell you absolutely everything you needed from 6750 1 the punched cards to the paper, the big 15 by 2 11 perforated sheets of paper from the card 3 readers, processors, and the services to run 4 the computer. So there are no companies like 5 that anymore today. 6 So we all live in a world and work in 7 a world where we have to interoperate, 8 interact. 9 And the way we do that is by creating 10 standards for interoperation and 11 interconnection of our products with other 12 companies' products. 13 We say that we have an open 14 architecture or we rely on open standards that 15 are not under the control of any single company 16 where that company can get an advantage by 17 changing the standard in one direction or the 18 other. 19 That when we have a standard, the 20 standard is to the benefit of everyone and is 21 improved or brought forward or advanced by the 22 efforts of the participants in the industry. 23 So if we need to support a new kind of 24 memory stick or a new kind of disk drive, then 25 we agree on standards to do that. And we then 6751 1 make sure that everyone can agree that it's not 2 going to benefit one company or another and 3 move forward. 4 That's the idea behind open 5 architecture and open standards. And that 6 creates and promotes the furtherance and 7 improvement of all of our products. 8 Q. Does it still allow for competition 9 technologically between different companies? 10 A. Fierce and ferocious, yes. That kind 11 of competition, there are multiple 12 manufacturers of disk drives who rely on 13 standards, for example. 14 There are companies who make the USB 15 memory sticks that rely on competition that are 16 fiercely competitive with each other. 17 MR. LAMB: If I could get the next 18 slide, please. 19 Q. Now, I want to go to the 1988-1989 20 time frame, sir, and if you could get down one 21 more time and essentially draw what I think you 22 described before is Windows on top of DOS and 23 the API interfaces. 24 A. Sure. 25 MR. LAMB: Can I get up, Your Honor? 6752 1 THE COURT: Yes. 2 A. All right. So we are going to have 3 DOS, we have Windows, Windows applications, and 4 DOS applications. 5 And we've got interfaces here between 6 the Windows application and Windows or between 7 Windows and the DOS operating system. 8 Q. Okay. 9 A. And Windows was the graphical user 10 interface for applications that ran with or 11 under Windows. 12 Q. Okay. Now, at this point in time, in 13 the '88-'89 time frame, was Microsoft a 14 proponent of full disclosure of interfaces or 15 APIs? 16 A. Was it a proponent? Microsoft had -- 17 Microsoft stated publicly that it was 18 disclosing its interfaces. 19 Q. Okay. And was that important? 20 A. It was important to do, was so to 21 state. 22 Q. Okay. Was that a standard in the 23 industry at that time period of disclosure of 24 APIs? 25 A. Interface disclosure was a -- as I 6753 1 indicated, it was something that was in the 2 interests typically of the platform owner to 3 do. You wanted to disclose interfaces because 4 you wanted software to work with -- independent 5 software vendor software to work with you. 6 Q. Okay. So the platform owner, the 7 owner of the operating system, wanted to 8 disclose interfaces to the ISVs who were 9 developing the software, the applications that 10 would run on; right? 11 A. That's correct, yes. 12 Q. Okay. And that was the standard or 13 the norm in the industry at that time? 14 A. That was the, yes, the standard. 15 Q. Okay. Now, you said that Microsoft 16 said that they were going to disclose the 17 interfaces. 18 Did they? 19 A. Well, interface disclosure has this 20 quality that if you disclose some but not all, 21 you are still disclosing some but not all. 22 So they disclosed some interfaces and 23 did not disclose other interfaces. 24 Q. Isn't some interfaces good enough? 25 A. Some interfaces, generally speaking, 6754 1 is not good enough. 2 Q. Why not? 3 A. Well, it's -- there's kind of a 4 two-stage. If the interfaces -- if there are 5 two interfaces, let's say, for getting the time 6 of day, that's something an application program 7 might want to do, is to get the time of day. 8 And so you can imagine an operating 9 system here. It's got the hardware. There's a 10 clock on your computer and it's a very accurate 11 clock. And so you are interested in finding 12 out inside an application what time of day is 13 it. 14 So you can ask the operating system 15 through an application programming interface 16 the same kind of thing that we drew a circle or 17 used to draw a circle with yesterday. You can 18 get the time of day. 19 And if there are multiple ways of 20 getting the time of day, if there is no 21 difference between those ways of getting the 22 time of day, multiple APIs, and there's no 23 difference between them, then it really doesn't 24 matter if the interface is disclosed -- if the 25 other interfaces are disclosed. 6755 1 The problem comes when you don't 2 disclose interfaces that can improve the 3 performance of one product, one software 4 product or application over interfaces that 5 another software application might use to 6 perform the same function. 7 So time, it's pretty hard to see that 8 you could make a big difference. If I told you 9 to use this time API and I used in my 10 applications a different way of getting the 11 time of day. 12 So there's little reason to suspect 13 that it's going to make a big deal of 14 difference, at least in terms of performance 15 right now. 16 But going forward -- but other types 17 of interfaces, such as having to do with memory 18 management, are very important and can make a 19 big difference in the viability and the 20 capabilities of applications that need lots of 21 memory. 22 And if I don't disclose to you, for 23 example, the interfaces that enable you to do 24 -- to manage memory really well and I use those 25 interfaces in my own program, my program's 6756 1 going to look better in the market in terms of 2 performance and technical capabilities when 3 compared to yours. 4 Q. Okay. And at some point in time, did 5 Microsoft take actions technologically once it 6 became MS-DOS to undermine DR-DOS? 7 A. Microsoft began to take actions, yes. 8 Q. Okay. Why don't you take your seat 9 again, sir. 10 You want a break? 11 A. I would be less than candid. 12 THE COURT: Very well. We'll take a 13 10-minute recess at this time. Remember the 14 admonition previously given. 15 All rise. 16 MR. LAMB: Thank you, Your Honor. 17 THE COURT: Leave your notebooks here. 18 (A recess was taken from 1:04 p.m. 19 to 1:23 p.m.) 20 THE COURT: You are still under oath, 21 sir. 22 BY MR. LAMB: 23 Q. What I want to do now, Mr. Alepin, is 24 I want to turn toward DR-DOS and what happened 25 at DR-DOS, okay. 6757 1 MR. LAMB: And if you could pull up 2 Exhibit 3228, Darin. And highlight the to, 3 from. 4 All right. Yeah, highlight that. 5 Q. Mr. Alepin, what is that? 6 A. That's an excerpt from a source code 7 program, from a program. 8 Q. Okay. And what does it have to do 9 with verify DOS? 10 A. Well, it's a -- the text of a message, 11 a warning message that will appear on a user's 12 screen when the user is using Microsoft 13 QuickPascal in conjunction with a DR-DOS 14 program. 15 Q. Okay. The warning says, Microsoft 16 QuickPascal has been tested for use only with 17 the MS-DOS and PC-DOS operating systems. 18 Your use of this product with another 19 operating system may void valuable warranty 20 protection provided by Microsoft on 21 QuickPascal. 22 Do you see that? 23 A. I do. 24 Q. Okay. And that's come to be known as 25 verify DOS; correct? 6758 1 A. Well, it's part of what's come to be 2 known as verify DOS. 3 Q. Okay. Can you explain to the Jury 4 what verify DOS was? 5 A. Well, verify DOS was a function, like 6 a subroutine, that was incorporated into some 7 of Microsoft's developer tools products in 8 particular that would test when the program was 9 started -- when in this case here the 10 QuickPascal program was started, to determine 11 whether or not it was running with Microsoft's 12 operating system or whether it was running with 13 a different operating system. 14 Q. Okay. And who created verify DOS? 15 A. Microsoft programmers created verify 16 DOS. 17 Q. Okay. And what was the impact of 18 verify DOS? What did it do? 19 A. Well, the message would appear on 20 non-Microsoft operating system users' screens 21 and indicate to them that if they had problems, 22 they would not be able to obtain warranty 23 service, service under a warranty. 24 Q. And was there any reason to believe 25 that they would have problems? 6759 1 A. There was no reason to believe that 2 they would have had problems or encountered 3 problems, no. 4 Q. And, in your professional opinion, 5 what was the purpose of this verify DOS message 6 sequence? 7 MR. HOLLEY: Objection, Your Honor. 8 THE COURT: Overruled. 9 You may answer. 10 A. The purpose of the -- of issuing the 11 message was to make users concerned about using 12 different operating system than Microsoft's. 13 Q. Is this another example of FUD? 14 A. Indeed. 15 Q. Okay. In relation to DR-DOS? 16 A. Especially. 17 Q. Okay. There is another concept in 18 relation to DR-DOS -- 19 MR. LAMB: If you could go back to the 20 screen, Darin. 21 Q. -- called AARD code. 22 What was that, sir? 23 A. Well, sort of the -- it was 24 essentially the second generation verify DOS 25 function. 6760 1 It was intended as a technical matter 2 to detect whether Microsoft software in Windows 3 was running on a DR-DOS operating system or an 4 MS-DOS operating system. 5 Q. Okay. 6 MR. LAMB: Can I get Exhibit 5026? 7 Q. This is from Bill Gates; right? 8 A. Yes. 9 Q. And it's to Steve Ballmer. 10 Who is Steve Ballmer again? 11 A. He's now the CEO, I believe, of 12 Microsoft, but at the time he was a senior 13 executive in Microsoft. 14 Q. And do you know who Jon Shirley was? 15 A. I think he was the COO or the 16 president. I'm not sure. The senior 17 executive. 18 Q. Okay. Jeremy Butler? 19 A. Not sure. 20 Q. Michael Cooper? 21 A. Nor he. 22 Q. Paul Maritz? 23 A. Senior executive in charge of 24 development. 25 Q. Russ Werner? 6761 1 A. An employee of Microsoft. 2 Adrian King, I'm not sure at the time. 3 Q. Chris Smith? 4 A. I'm not sure at the time. 5 Q. And this is international reviews 6 systems, Notes. Do you see that? 7 A. Yes. 8 Q. Dated February 8, 1989. And cc 9 Joachim Kempin? 10 A. Yes. 11 Q. Mike Maples, Rob Glaser, and Bob 12 O'Rear. Do you know who those people were? 13 A. Rob Glaser was an executive at 14 Microsoft who went on to form RealNetworks. 15 Mike Maples I believe was -- he was a 16 senior executive at Microsoft I believe in 17 charge of sales. 18 Joachim Kempin was the head of the OEM 19 group. 20 MR. LAMB: Okay. And Darin, could you 21 highlight the first section? 22 Q. Okay. This says regarding Olivetti, I 23 heard over and over again that people are 24 looking at Unix as the standard for operating 25 systems, including Intel architecture office 6762 1 automation. 2 MR. LAMB: My apologies. 3 Oh, thanks, Darin. 11, DR-DOS. Would 4 you highlight that section? I'm sorry. 5 Q. Okay. This is from Bill Gates again. 6 It says, I want to make sure we get the message 7 implemented in all of our product. Languages 8 are important. Windows is important. 9 Applications are important. How can we spread 10 the message about getting this done including 11 the localized versions? I guess we have to 12 localize this message. 13 Russ, please let me know your action 14 plan for this. 15 What did that relate to, sir? 16 A. That related to getting the warning 17 message that we discussed earlier in verify 18 DOS. 19 Q. Okay. The verify DOS warning message? 20 A. I believe that's the case, yes. 21 Q. Okay. And it's your understanding 22 from reading that that that's what Mr. Gates is 23 talking about? 24 A. That's correct. It's getting the 25 message -- the detection and warning 6763 1 implemented across Microsoft's entire product 2 portfolio. 3 MR. LAMB: Could we have Exhibit 3506? 4 Q. This is to David Col. Do you see that 5 section right there? 6 A. Yes. 7 Q. Do you know who that is? 8 A. David Cole is an executive in the -- I 9 believe in the development organization. 10 Q. Okay. And this is dated Monday, 10 11 February, 1992; right? 12 A. Yes. 13 Q. And it says, what the guy is supposed 14 to do is feel uncomfortable, and when he has 15 bugs, suspect that the problem is DR-DOS and 16 then go out to buy MS-DOS or decide to not take 17 the risk for the other machines he has to buy 18 for in the office. 19 Do you see that? 20 A. I do. 21 Q. Okay. Now, what's your understanding 22 of what subject he's referring to? 23 A. He is referring to the expected 24 response of a user who receives the messages 25 that we talked about before, the verify DOS 6764 1 message, in particular, the warning message. 2 Q. Okay. And did that intended effect 3 occur? 4 A. The message appeared and it would have 5 had its intended effect. 6 Q. Okay. 7 MR. LAMB: Can I have Exhibit 981, 8 please? Can you highlight the to, from for us? 9 Q. Okay. This is from Phil Ba to Brad 10 Si, cc David C-o-l. Do you know who Phil Ba 11 is? 12 A. Phil Barrett. 13 Q. And who was he? 14 A. He was in the platform development 15 group, the development group. 16 Q. And then that's Brad Silverberg; 17 right? 18 A. Yes. 19 Q. And David Col, right? 20 A. Whom we just saw, yes. 21 Q. And this is subject Bambi on DR-DOS 22 6.0. 23 A. Yes. 24 Q. What was the Bambi? 25 A. Bambi was a component of the Microsoft 6765 1 Windows graphical user interface program. 2 Q. Okay. And what did it do? 3 A. It was -- it provided the ability to 4 take a portion of your memory, your high-speed 5 memory and make behave like a disk drive and 6 that could be like taking stuff that you would 7 store on a disk drive -- and, believe it or 8 not, disk drives are a lot slower than memory, 9 a lot, lot slower. 10 So you could take a portion of a disk 11 drive and put it into memory. And every time 12 you read or wrote to it, it would be really 13 fast. And that could make a difference for 14 certain types of applications, including 15 Windows. 16 Q. So that was a beneficial application? 17 A. That was a beneficial application. 18 Q. Okay. And this message says heh, heh, 19 heh. My proposal is to have Bambi refuse to 20 run on this alien OS. Comments? 21 Do you see that? 22 A. I do. 23 Q. Okay. What's your understanding of 24 what alien OS refers to? 25 A. DR-DOS. 6766 1 Q. Okay. So from a technology 2 perspective, what is this suggesting happen? 3 A. That Microsoft software component, 4 Bambi, refuse to run if it was launched on a 5 DR-DOS operating system. 6 Q. Okay. How would they do that? 7 A. Well, they would check to determine 8 whether or not they were running on DR-DOS and 9 then say -- programs sometimes talk, but the 10 software would check when it was running in 11 DR-DOS and then say in the form of error 12 message refusing to run and then exit and not 13 continue processing. 14 Q. Now, by this time, had Microsoft 15 created a fix for this issue with Bambi? 16 A. It's went through a couple of stages, 17 but, yes. 18 Q. And did this suggest to you that they 19 just not disclose the fix? 20 A. Well, not make the fix available, yes. 21 They disclose -- sometimes we talk about 22 disclosure of interfaces. Sometimes we talk 23 about disclosure in the sense of giving out and 24 taking your -- Microsoft refuses to release a 25 fix. 6767 1 Q. Okay. So they just don't fix it? 2 A. As a practical matter, that's the end 3 result. Users who have the product don't get 4 it and can't get a fix. 5 Q. Okay. And what's the impact for users 6 who are operating DR-DOS? 7 A. They have the problem that Bambi -- at 8 the various stages Bambi would not run. 9 MR. LAMB: All right. Let's go back 10 to the screen, please, Darin. 11 Q. The next concept is nested task. 12 What is nested task, sir? 13 A. Oh, a difficult thing to answer in a 14 single sentence. 15 Q. I'll give you a couple. 16 A. Okay, thank you. 17 Q. All right. 18 A. Nesting is a concept that -- maybe I 19 can use a board. 20 Q. Please. 21 MR. LAMB: Is that okay, Your Honor? 22 Thank you. 23 A. First of all, we talked about zeros 24 and ones, meaning yes or no or on and off. And 25 oftentimes we refer to a particular bit, in 6768 1 particular, zero or one as being a flag and it 2 indicates whether it's up or down. So that's 3 kind of our idea of a flag. 4 And programs test these individual 5 flags and they assign meaning to these flags. 6 So some flag would say it's after 7 midnight. Some flag would say I've already 8 posted this transaction. Some flags would say 9 that the disk drive is busy. So we have flags 10 that mean different things and are assigned 11 different specific meanings. 12 Sometimes these flags are shared by 13 the hardware and the software so that they have 14 a common meaning. 15 So the Intel microprocessor has a 16 flag, a switch, that programs can set and 17 programs can look at and they can say -- and it 18 has assigned this meaning called nested task. 19 So it's a flag, a zero or a one, has a 20 specific meaning and it means something both to 21 the operating system software and to the 22 hardware. 23 Very important kind of -- typically, 24 these flags here that are shared between the 25 hardware and the software are pretty important 6769 1 flags, pretty important pieces of information 2 that you have to be careful how you handle. 3 Q. Okay. Why is that? 4 A. Well, because if you turn it on or 5 turn it off at the wrong time, bad things 6 inevitably happen. It's just like night 7 following day. Various things happen. So -- 8 Q. It did it again. 9 A. So first thing flags. Second thing 10 shared between hardware and software. 11 Third thing is this idea of nesting. 12 So we have program A and program B. 13 And if program A calls to program B, and we use 14 that as a term that says program A wants 15 program B to perform some function and to 16 return when it's done. 17 So, in our world, call and return are 18 the kinds of ideas that are associated with 19 starting up a subroutine and having a 20 subroutine return to us. 21 So call B and here return. So this is 22 the normal way things would work. 23 And in portions of the operating 24 system or in programs that are more conversant 25 with the hardware, what happens is that the way 6770 1 return is processed by the hardware depends on 2 the setting of this flag. 3 So over here we have this nested task 4 flag, and it can be zero or one. And depending 5 on the value of this, this return is going to 6 return back up to this program or it's going to 7 go up to a higher level. 8 So it's going to think that it's 9 actually some layer above program A that is 10 supposed to receive control back when program B 11 has finished operating. 12 That's the -- and the nested task 13 flag, zero or one, is the flag that controls 14 how the hardware will handle the return of 15 control from this program to that program. 16 If you set it wrong, if program A has 17 the nested task flag set to a particular value 18 and someone changes it, then control will go up 19 to some point beyond program A and bad things 20 will happen. 21 That's kind of the important summary, 22 a few more sentences. 23 Q. Okay. This slide says nested task, a 24 bug created by Microsoft that Microsoft decided 25 not to fix. 6771 1 What do you mean by that? 2 A. Well, as I indicated, you are supposed 3 to manage carefully these hardware flags, these 4 hardware indicators, because you shouldn't 5 touch what you don't know about. 6 The idea is you're only supposed to 7 have responsibility over those things that you 8 know what you're doing with. 9 So in this particular case, 10 Microsoft's software reset the nested task flag 11 without considering that the value of the 12 nested task flag had a specific meaning to a 13 different program. 14 So what you're supposed to do is to 15 maintain the state of the nested task flag, a 16 zero or a one, when you get control, and unless 17 you need to change it for some specific reason, 18 you shouldn't change it. 19 In the context of the Microsoft 20 software, it changed it, and this caused DR-DOS 21 to malfunction with Microsoft's software. 22 Q. Okay. So this was a problem created 23 by Microsoft? 24 A. This was a problem in the Microsoft 25 software. Microsoft created the software. 6772 1 Q. With DR-DOS? 2 A. That's correct. 3 Q. And what did Microsoft do about it? 4 A. It did not acknowledge it as a problem 5 with its software. 6 Q. So it didn't fix it? 7 A. That's right. 8 Q. In relation to AARD, AARD code, 9 describe that a little bit for us. Is that an 10 acronym for us? What does that mean? 11 A. AARD code was simply the code that was 12 developed, I believe, by a Microsoft DOS 13 programmer by the name of Aaron Reynolds. And 14 I think that the AARD comes from his initials. 15 Q. Okay. And what did it do? What did 16 the AARD code -- 17 A. Well, the AARD code went through 18 memory inside the operating system and looked 19 for indications that it was running on a DOS 20 operating system. So it was checking to see 21 what kind of operating system it was running 22 on. 23 And it ran -- it went through various 24 pieces of information we call control blocks. 25 That's organized chunks of data that the 6773 1 operating system is using to store information. 2 Went through these various control blocks 3 looking for whether it was on an MS-DOS 4 operating system or a DR-DOS operating system. 5 Q. Okay. And then what did it do? 6 A. Well, a couple of things that I should 7 add as preamble. It hid itself, itself 8 obfuscated. 9 So if you were trying to figure out 10 what it was doing, it would hide itself. So, I 11 mean, this was a little clever and extremely 12 unusual. I mean, clever as a programming 13 technique and highly unusual and extraordinary 14 so that if you wanted to figure out what it was 15 doing, it would sense that you were trying to 16 do this and it would cover itself up. 17 So obfuscating. But it would -- once 18 it detected that it was running on a 19 non-Microsoft operating system like DR-DOS, it 20 would pass back a result to indicate yes or no. 21 Yes, Microsoft. No, not Microsoft. 22 Q. Okay. And what would happen then? 23 A. And then the program in this 24 particular case when AARD was included, the 25 AARD code was included, an error message 6774 1 appeared on the screen. 2 Q. What was the error message? 3 A. The error message indicated that there 4 was an unspecified error and that you should 5 call Microsoft support. 6 Q. Okay. Was there, in fact, an 7 unspecified error? 8 A. No. 9 Q. All right. And was AARD ever included 10 in a final version of Windows? 11 A. Well, I believe that it was still 12 there present, but it was circumvented. 13 Q. Okay. What does that mean? 14 A. That means that it was not active. So 15 that essentially if you think of a program as 16 being like a page going from the top to the 17 bottom, what happened was there was a little 18 instruction inserted saying go to the next page 19 and don't continue reading. I believe that's 20 the case. 21 Q. All right. Did that matter? 22 A. Well, it mattered in terms of getting 23 the error message, of course. 24 Q. Okay. What impact did that have on 25 ISVs or OEMs or the actual end user? 6775 1 A. Well, you would get the error message 2 and you would be -- you would not know 3 precisely what caused the error. You would 4 suspect that there was an error. And you would 5 perhaps call the support line. 6 Q. Okay. But you're operating on DR-DOS 7 but calling the Microsoft support line? 8 A. That's why you're using a Microsoft 9 piece of software too. 10 Q. Okay. Did they have a fix for that? 11 A. There was no fix. There was no error. 12 Q. Okay. So you get an error message, 13 but there's not an error message? 14 A. That's correct. 15 Q. And you call Microsoft? 16 A. That's correct. I mean, if you do, 17 yes. 18 Q. What's the point of that exercise? 19 A. Other than a negative feeling on the 20 part of the person who received the message. 21 Q. Okay. Is that another example of FUD 22 in your professional opinion? 23 A. Yes. 24 Q. Was AARD in the Christmas beta that 25 went out for Windows in 1991? 6776 1 A. Beta program -- perhaps I should 2 explain a little bit. 3 Q. Sure. 4 A. Beta programs are programs, earlier 5 versions of software that ultimately they are 6 going to ship. 7 So when a software development company 8 like Microsoft or others feel that the software 9 is reasonably stable and close enough to let a 10 larger community of users work with it, we let 11 it out as a beta program. 12 We say here, use it at your own risk, 13 don't create any data that you really need, and 14 it's -- but it's getting closer to what we 15 finally expect to be able to show. 16 And so this was a Christmas beta of 17 Windows. 18 Q. You testified yesterday that 19 incompatibility was the kiss of death. 20 Do you remember that, sir? 21 A. I do. 22 Q. Is the appearance of incompatibility 23 also the kiss of death? 24 A. Well, that's correct. I mean, the 25 appearance of incompatibility or 6777 1 incompatibility itself, yes, is the kiss of 2 death. 3 MR. LAMB: Can we go to Exhibit 3516, 4 please? 5 Q. This is to Joseph -- I have no idea 6 how to pronounce that. Do you know how to 7 pronounce that? 8 A. Krawcsak. 9 Q. Krawcsak. Do you know who that is? 10 A. No, sir. 11 Q. From Terry Bourne. Do you know who 12 Terry Bourne is? 13 A. No. 14 Q. And it says re: Ask Patty any 15 questions or suggestions. 16 MR. LAMB: Is there a Number 15 on 17 this, Darin? 18 Okay. That says no upgrade over 19 DR-DOS 6.0 error and MS-DOS extender. Do you 20 know what that refers to? 21 A. Yes. It's a -- in the Microsoft part 22 of the Windows software, was a DOS extender 23 piece of software that enabled the use of 24 extended memory. And so there's -- this is a 25 discussion of the MS-DOS extender. 6778 1 Q. Okay. It goes on to say, Digital 2 Research has released a patch that they say 3 will make DR-DOS 6.0 compatible with Windows 4 3.1. 5 This patch can be obtained by calling 6 RD tech support or by downloading it off of 7 compressive or the RDBB. Do you see that? 8 A. Yes. 9 Q. And then it says, keep in mind that PC 10 does not support running MS Windows on top of 11 the RD DOS operating system. 12 What does that refer to? 13 A. I think the RD -- it refers to whether 14 or not users can obtain a patch from Digital 15 Research, I believe, that would solve the 16 problem. 17 Q. Solve what problem? 18 A. Solve a problem that was available in 19 users using DR-DOS with Windows 3.1. 20 Q. Okay. So a patch was available? 21 A. A patch was available from DR-DOS -- 22 from DRI, yes. 23 Q. Okay. And does this relate to nested 24 task? 25 A. I believe this one relates to nested 6779 1 task. 2 Q. Okay. And does this suggest to you 3 that nested task was a widely encountered 4 problem? 5 A. Nested task flag was a problem that 6 affected users, yes. 7 Q. Did it happen to a lot of users? 8 A. I think it happened to a number of 9 users, yes. 10 Q. Okay. And what was the effect of 11 nested task, the nested task bug on DR-DOS 12 users? 13 A. That their systems would fail, fail to 14 operate correctly. 15 Q. The system would fail? 16 A. That's correct. 17 MR. LAMB: Go to the next slide, 18 please. 19 Q. This slide is entitled OS/2. 20 If you could for a moment, why don't 21 you explain to the Jury what OS/2 was. 22 A. Well, in 1985 or thereabouts, IBM and 23 Microsoft came together to form a joint 24 development effort that would create the next 25 version of the operating system for the 6780 1 personal computer. 2 It had been clear that there were 3 limitations in the first version, in the MS-DOS 4 that weren't going to be fixed incrementally. 5 So IBM and Microsoft got together to 6 jointly develop OS/2, a new operating system. 7 This operating system was a road map 8 for the operating system, including support for 9 lots of new features and functionality and to 10 provide a much more robust -- and by robust, I 11 mean much more hardened against errors and 12 problems and runaway programs and applications. 13 It was going to be a very solid 14 operating system that could support larger 15 capacity systems and provide businesses with 16 the kind of reliability that they needed and 17 wanted. 18 Q. Okay. Now, this was an operating 19 system that was supported by both IBM and 20 Microsoft? 21 A. That's -- it was developed by both 22 IBM, programmers from both companies worked 23 together collaboratively to develop it. 24 Q. And was it designed to incorporate 25 Windows? 6781 1 A. It was designed to be a better Windows 2 than Windows. Was designed to accommodate 3 Windows applications as well as OS/2 4 applications as well as DOS applications. 5 Q. Okay. It was touted as a better 6 Windows than Windows? 7 A. That was one of the maxims or 8 marketing phrases, yes. 9 Q. Okay. What happened to OS/2? 10 A. OS/2 faded away. OS/2 is no longer 11 with us in practice. 12 Q. What do you mean it faded away? 13 A. Well, it was -- it encountered a 14 series of problems and setbacks and ultimately 15 was -- it was no longer actively developed by 16 IBM. 17 Q. Okay. What is DPMI? 18 A. DPMI is a standard. 19 Q. What do you mean by that? 20 A. It stands for a set of specifications 21 that the industry would or could use to develop 22 certain kind of software. 23 In particular, it was addressing the 24 issue of DOS protected mode and the ability to 25 use larger memory in a PC than the original 6782 1 640K or the original one megabyte of memory. 2 Q. Okay. And why was DPMI important in 3 relation to the development of OS/2? 4 A. Well, DPMI had the ability or would 5 allow IBM to run Windows without modification 6 on top of OS/2. Windows applications on top of 7 OS/2 without modification as well. 8 Q. And was that technologically valuable? 9 A. That was extraordinarily valuable 10 because it was a great idea. 11 Q. Okay. And how was IBM to get the 12 DPMI? 13 A. Well, the idea of DPMI is that you 14 have two sides to it, a server and a client. 15 And the first operating system that starts out 16 according to specification can say I'm the DPMI 17 server. 18 And if you fully implement the DPMI 19 specifications and operating system or piece of 20 software that is going to use big memory, big 21 memory, then you'll be a client to the server 22 and you'll make requests of the server. 23 But if you're the first one up, you 24 start, you say I'm the server. That's the way 25 the thing is supposed to work. 6783 1 Originally Windows was announced to be 2 both a DPMI-compliant server and a 3 DPMI-compliant client. 4 If it were a DPMI-compliant piece of 5 software, IBM could have just simply started up 6 OS/2 and then started up Windows and Windows 7 would have worked properly underneath OS/2. 8 This would have enabled IBM to isolate 9 individual Windows applications in their own 10 section of the computer, if you want to think 11 of it that way, and they wouldn't be able to 12 interfere with or cause a crash of the entire 13 system if an individual application by itself 14 would crash. 15 OS/2 was going to be able to say if an 16 application, Windows application crashes, it 17 affects only that Windows application if you're 18 running under OS/2. 19 Whereas, before, if a Windows 20 application -- you had two windows open and one 21 Windows application crashed, it would 22 oftentimes take out the whole machine. So 23 you'd have to reboot the system. 24 OS/2's idea here was that it was going 25 to isolate these various Windows applications 6784 1 in their own section of the machine and keep 2 them from stepping on each other or from 3 stepping on the machine as a whole. 4 Q. From a technological viewpoint, was 5 that advantageous? 6 A. That was technically very desirable to 7 be able to do that. 8 Q. Okay. With the Court's permission, 9 would you be able to get up and diagram for the 10 Jury the relationship between OS/2 and Windows 11 and how it interrelated with DPMI? 12 A. Well, let's see. 13 So, basically, you would have -- 14 inside OS/2, you would be able to run OS/2 15 applications up here. You would be able to run 16 DOS applications in here, and you would be able 17 to run Windows applications one by one isolated 18 from each other within an OS/2 computer. 19 So you could run DOS applications, 20 OS/2 applications, and Windows applications, 21 each of which would be isolated and separated 22 from each other. 23 And, in doing so, you would need for 24 the Windows DPMI software to interact with the 25 OS/2 DPMI software in order to cooperate 6785 1 properly over the use of the memory in the 2 computer. 3 Q. Okay. So who controlled the DPMI 4 software? 5 A. The DPMI standard was a standard that 6 Microsoft first proposed to the industry in the 7 early 1990s. 8 Q. Okay. So this was something that -- 9 I'm sorry? 10 A. I'm just making sure of my date. 11 Q. Okay. So that's something that 12 Microsoft proposed? 13 A. Uh-huh. Yes. 14 Q. And in relation to OS/2, was the DPMI 15 software created by Microsoft? 16 A. Microsoft created a fully compliant 17 Windows version with a DPMI server and DPMI 18 client. 19 Q. Okay. Did the issue ever arise in 20 relation to the accessibility or obtaining the 21 DPMI software from Microsoft by IBM? 22 A. Well, this is kind of a little more 23 elaborate story, but the parties, IBM and 24 Microsoft, had a joint development agreement, 25 as I indicated, that started in the mid-1980s. 6786 1 And this agreement continued for a 2 number of years until the parties decided that 3 they were going to go their separate ways. 4 And they maintained an agreement 5 afterwards that called for each of their 6 companies to give each other their source code 7 for Windows from Microsoft or for OS/2 from IBM 8 for a period of time after they agreed to end 9 the agreement -- their joint development. 10 Microsoft had this what we call code 11 drops. They were supposed to provide the code 12 on a monthly basis, I believe. And from that 13 code, of course, you would be able to see what 14 Microsoft was including or not including in its 15 software. 16 Q. Okay. 17 A. And so there was an issue concerning 18 whether or not IBM was getting that code. 19 Q. Explain that, there was an issue 20 regarding whether or not IBM was getting the 21 code. 22 A. Well, you would -- on a monthly basis, 23 you would get the full complement of the source 24 code to the software that you were supposed to 25 get under the agreement, but when Microsoft 6787 1 made the decision that it was going to withdraw 2 full DPMI support, when it said we're not going 3 to provide full support for Windows DPMI, they 4 withheld the source code from IBM for a period 5 of time that would have sort of indicated that 6 that was happening. 7 Q. Okay. And what was the impact of 8 withholding that DPMI? 9 A. Well, the -- we're talking about just 10 the withholding or the delay in handing over 11 the information. 12 What that did is it delayed the time 13 by which IBM would understand or come to 14 realize that DPMI was not going to be fully 15 supported in the software that Windows -- that 16 Microsoft was planning to release. 17 Q. Okay. And what impact did that have 18 on the development of OS/2? 19 A. Well, once IBM -- once Microsoft 20 decided that it was going to take out full DPMI 21 compliance, it meant that IBM had to adopt a 22 different strategy to be able to achieve the 23 same goal that I set out on that diagram there, 24 and that would be to run multiple Windows 25 applications in isolation. 6788 1 IBM had to adopt a different technical 2 means to achieve that end once Microsoft had 3 removed full DPMI capability from the software 4 in Windows. 5 Q. Okay. And is that a compatibility 6 issue? 7 A. It's certainly a big compatibility 8 issue, yes. 9 Q. And what was the effect of that 10 compatibility issue or lack of compatibility on 11 the development of OS/2? 12 A. It delayed the availability of OS/2 13 for a considerable amount of time. 14 Q. Okay. And what -- 15 A. And it raised the price of OS/2 16 substantially in the market. 17 MR. LAMB: Go to the next slide, 18 please. 19 Q. Again, we're going through kind of the 20 history and an overview, and we are on 1995. 21 And the heading of this slide is 22 Microsoft consolidates technological power, and 23 one of the bullet points is Windows GUI no 24 longer separately available. 25 What does that mean? 6789 1 A. Well, I talked about Windows as being 2 the graphical user interface that was shipped 3 as a product separate and apart from the DOS 4 operating system up until 1995. 5 And Windows was, and still is, in 6 fact, a graphical user interface. 7 When Microsoft bundled and technically 8 tied the two of them together, it was -- they 9 stopped making Windows, the GUI, available 10 separately for purchase. 11 You could only buy Windows 95 and that 12 was the Windows GUI bound to the DOS operating 13 system. 14 Q. Okay. And they started to market it, 15 then, as an operating system; right? 16 A. That's correct. 17 Q. And was it the dominant operating 18 system in the industry as far as PCs? 19 A. By far it was. 20 Q. All right. You also note that there's 21 a tremendous growth in the Internet at this 22 point in time. And there's a bullet point that 23 says Microsoft takes actions to bundle or tie 24 the operating system to the web browser, 25 Internet Explorer. 6790 1 Is that what you testified about 2 yesterday? 3 A. It was, yes. 4 Q. Okay. And then you go on to say that 5 Microsoft takes actions to eliminate Netscape. 6 Do you see that? 7 A. I do. 8 Q. Okay. And what actions were those? 9 A. There were -- there were a series of 10 steps, including at the top level saying to the 11 developer communities and the PC hardware 12 makers and to users generally that the browser 13 will be part of the operating system. That's 14 one way. 15 By taking certain -- by bundling the 16 browser with the operating system as a 17 technical matter, by tying the operating system 18 to the browser as a technical matter. That is, 19 making the two of them inseparable technically. 20 You can't take one away from the 21 other. And by making it harder for Netscape to 22 be as good an application using the services of 23 Windows as Microsoft's browser was. So not 24 disclosing to them interface information that 25 they could use to be as good as IE. 6791 1 Q. Okay. Not disclosing interface 2 information. 3 A. Uh-huh. 4 Q. Are there various types of interface 5 information? 6 A. There are various types of interface 7 information, various types of specifications 8 that we use in our business, yes. 9 Q. Okay. Are there both internal APIs 10 and external APIs? 11 A. There are internal APIs and external 12 APIs. 13 Q. Can you explain for the Jury the 14 difference? 15 A. Well, an internal API is an API that 16 is intended to be used by other components 17 within the operating system. For example -- or 18 within a piece of middleware. 19 An external interface or an external 20 API is a point of attachment between two 21 components or software products that can be 22 operated separately. These external and 23 internal also operate between hardware products 24 as well. So -- 25 MR. LAMB: With the Court's 6792 1 indulgence, I'm going to ask you to brave the 2 board again to draw that if you could. 3 THE COURT: We have a different pad. 4 MR. LAMB: Okay. We do? 5 THE COURT: Carrie got it. 6 MR. GREEN: It's over there. 7 MR. LAMB: Can I go up there, Your 8 Honor? 9 THE COURT: Yes. Try to attach it if 10 you can. It's made for that. 11 MR. LAMB: I'll take your word for 12 that. 13 THE COURT: Works? 14 MR. LAMB: Look at that. Good luck, 15 sir. 16 THE WITNESS: Thank you. 17 Q. Now do you want me to remind you of 18 what I asked you? 19 A. I'm afraid so. 20 Q. Okay. We're talking about internal 21 and external APIs, sir. And if you could kind 22 of diagram for the Jury and explain the 23 difference, I would appreciate it. 24 A. Sure. 25 Q. Okay. 6793 1 A. So the basic idea here is that 2 software is generally comprised -- the best 3 approach to the development of software is to 4 build it in building blocks or modules, to 5 assemble it from a set of parts that you 6 individually develop as a good idea for a 7 number of reasons, but one of them is you can 8 get more people to work on it because each one 9 of them develops a separate part of the entire 10 piece. 11 So building it as a series of building 12 blocks is a good idea. 13 So you combine them all together, and 14 in order for them to work together in the piece 15 of software, they have to speak to each other 16 or communicate to each other. And they use 17 interfaces that are the same, conceptually the 18 same kinds of things. 19 The circle drawing example is exactly 20 the same thing that you would find in this kind 21 of interface as an internal interface between 22 two of the building blocks that comprise this 23 software as you would find in the example 24 before between a software application up here 25 and another piece of software that provides 6794 1 interfaces for a connection to it. 2 So you would have APIs here, which are 3 external and intended for the attachment of 4 another product. And internal interface is 5 where it's to enable the software components to 6 be assembled together as a single piece. 7 Q. Okay. So in relation to the operating 8 system, the people working on the operating 9 system need to know the internal APIs; right? 10 A. People working -- yes, they do. 11 Q. Okay. And as far as whatever 12 application is going to go on top of or utilize 13 the operating system, they have to know the 14 external APIs; right? 15 A. Yes. You need to know how to attach, 16 yes. 17 Q. Okay. But the application, does it 18 need to know the internal APIs for the 19 operating system? 20 A. Not if the product is written 21 properly, no, it should not. 22 Q. Should just be able to do it on the 23 external APIs? 24 A. That's correct. 25 Q. Okay. Would you mind taking your seat 6795 1 again, sir? 2 Thank you. 3 MR. LAMB: If you could flip the 4 slide, Darin. 5 Q. Okay. Now, keying off this and 6 interfaces and compatibility, you talked a lot 7 about issues relating to compatibility. And 8 there are certainly types of compatibility; 9 correct, sir? 10 A. There are types of compatibility, yes. 11 Q. Okay. Why don't you take a moment and 12 explain those to the Jury, if you would. 13 A. Sure. Well, different types of 14 compatibility affect the -- affect it in 15 different ways. 16 The user interface compatibilities, 17 the first and perhaps easiest one to 18 understand, and that's how you use a mouse, for 19 example, and what a mouse does. 20 If you click on the right mouse -- if 21 you click on the right mouse button, what does 22 it do? If you click on the right mouse button, 23 what does it do? 24 Those are descriptions of the 25 interface between the program, its behavior, 6796 1 and your actions. 2 Other elements of a user interface 3 include what the screen looks like and how you 4 can get something to appear, how you can launch 5 something. How error messages are displayed, 6 if it shows up in a pop-up box. If you use the 7 words okay or yes or no, those are all elements 8 of the user interface. 9 The symbols that you use, the shapes 10 of the objects on the screen, the way in which 11 the keyboard and the mouse are available to you 12 are part of a user interface. 13 Application programs have user 14 interfaces that we saw from yesterday when I 15 showed you the Intuit Quicken example. You 16 could see the checkbook. 17 Those are examples of user interface. 18 Q. How about object code or binary 19 compatibility? 20 A. Well, I also talked yesterday about 21 the possibility of taking a disk from a product 22 or a software product that you purchase at a 23 store and inserting it into your Windows 24 computer or -- and then launching the program 25 that you would purchase that was already in 6797 1 binary form. 2 So I had already as a developer or an 3 independent software vendor, I had created this 4 software in source code. I'd passed it through 5 my development tools, and I said I want to 6 build this and package it on this CD. 7 And I send it to you via it's a 8 Windows application and will only run on 9 Windows, in part because the binary code 10 reflects the source code which I designed to 11 work on Windows. 12 So there is a binary compatibility 13 that comes from the zeros and ones having been 14 put there for purposes of executing in 15 conjunction with a Windows operating system or 16 an X86 operating system. 17 That same binary cannot work in a 18 Macintosh power PC or on a SPARC. We talked 19 earlier about SPARC workstation computers or 20 MIPS computers, two other architectures of 21 hardware. 22 That binary code that I have on my 23 diskette or on my CD is intended for a specific 24 platform and a specific architecture and a 25 specific operating system. 6798 1 Q. Okay. And the next is source code 2 compatibility. 3 A. Source code compatibility is a higher 4 level of compatibility. 5 When I write a program, I can write it 6 in a language, let's say, an early language 7 that we used to use many, many years ago was 8 called COBOL. 9 COBOL was a programming language or 10 called common business oriented language. And 11 it had statements in it like perform steps 1 12 through 7 until transaction is complete. 13 And so it looked kind of like business 14 programming -- the way business people would 15 talk. Not decision-making up here, but the way 16 a programmer would take business rules and 17 apply them. 18 Well, that source code, I could take 19 that and pass it through development tools for 20 -- and say I want to build a Windows 21 application, or I could take it and pass it 22 through different development tools. 23 And assuming that I don't rely on any 24 of the other things in the operating system or 25 the hardware, I could take the source code and 6799 1 use it with development tools targeting a 2 different platform, a Macintosh computer or an 3 IBM mainframe computer. 4 So source code compatibility provides 5 me with the ability as an independent software 6 vendor to move or to target my application for 7 different platforms. 8 Q. Okay. And then, finally, application 9 program interface or API compatibility. 10 A. Well, this takes place on two levels, 11 but in the source code if -- as I described 12 yesterday, you have that circle function, and 13 instead of specifying that you want the 14 diameter second and the center point of the 15 circle first, you specify that the diameter is 16 first and the center point is second. 17 Then I will have to rewrite the source 18 language statements in my program to change 19 them to make that adjustment. 20 If I don't have to make any of those 21 changes as a programmer, if I can take my 22 source code that references the programming 23 interfaces that are part of, let's say, 24 Windows, I have application programming 25 interface compatibility. 6800 1 Q. And how important is API 2 compatibility? 3 A. API compatibility from an independent 4 software developer is very important insofar it 5 provides you with the opportunity to make your 6 software available on different platforms or 7 less effort. 8 MR. LAMB: Next slide, Darin. 9 Why don't we go to the next slide 10 because I think we are combined. There you go. 11 Q. First of all, the phrase church and 12 state in relation to -- not in relation to 13 politics, but in relation to your technology 14 and your industry and the computer industry, 15 what does that phrase mean, church and state, 16 sir? 17 A. Well, church and state -- it starts 18 with -- I believe the metaphor was used by an 19 IBM executive in the mid-1980s to refer to the 20 separation of the Microsoft applications 21 group -- people developing Microsoft 22 applications, from the Microsoft platform or 23 operating system group. 24 So I don't know which one was church, 25 which one was state, but the idea was that the 6801 1 two of them were separated and would not -- 2 there would not be a favoring by the state of 3 one particular church, the Microsoft church or 4 vice versa. 5 But that was the idea and that was the 6 purpose of sort of the -- of using that analogy 7 because it worked quite well. 8 Q. And was that a concept that you 9 understood that Microsoft said it adopted? 10 A. It was a concept that it -- a practice 11 that it said it adopted, yes. 12 Q. Okay. Did it, in fact, effect that 13 process? 14 A. In practice, no. 15 Q. Okay. I apologize, but I'm going to 16 ask you to get up again, sir, with the Court's 17 indulgence. 18 And what I want you to do is draw the 19 Microsoft operating system. And, as I 20 understand it, what you're saying is there's an 21 operating system group that's responsible for 22 that; correct? 23 A. Uh-huh. 24 Q. Is that correct? 25 A. There is. 6802 1 Q. So that's on the bottom. 2 A. Okay. 3 Q. And then where would the applications 4 group for Microsoft be? 5 A. The applications group, like other 6 applications, would be here making use of the 7 APIs, DOS and later -- I've got to wipe this 8 off. 9 Q. That's why you like the wipe board. 10 Okay. 11 So the APPL box that you have, that 12 would be the Microsoft applications group. 13 That would include like Office Suite? 14 A. That would include -- later that would 15 include Office Suite. 16 Q. Okay. And, then, would there be 17 another box also that would be ISVs? 18 A. ISVs would be, yeah. 19 Q. Why don't you put them -- 20 A. Same position. Let's call this -- we 21 can call this state and we can call this 22 church. 23 Q. And now the Microsoft applications 24 group needs to get the APIs, the external APIs 25 every bit as much as ISVs do from the Microsoft 6803 1 operating system group; correct? 2 A. That's correct. 3 Q. Okay. And did that happen? 4 A. The applications group got some of the 5 API information from the same mechanisms that 6 independent software vendors, such as Lotus or 7 Borland got their information. 8 Q. And they are supposed to be treated 9 equally, ISVs and the Microsoft applications 10 group? 11 A. That was the purpose of the announcing 12 of the practice, yes. 13 Q. Okay. Go ahead and take your seat 14 again. 15 The next bullet point you have is 16 companies that compete are not provided with 17 equal access to Microsoft's APIs. 18 What do you mean by that? 19 A. Well, at the time companies that 20 competed with Microsoft's programs, its 21 operating system program or its applications, 22 did not get the same kind of access to 23 programming interface information that they 24 needed compared with companies that were not 25 competing with Microsoft. 6804 1 Q. Okay. And what was the effect of 2 that? 3 A. Well, that hampered the independent 4 software developers' task of getting their 5 products to market. 6 MR. LAMB: Could we have Exhibit 2456, 7 please? Why don't you go to the top so we can 8 see the heading. No, it goes -- give me a 9 little bit more than that. Yeah. 10 Q. This is something called DRG summit 11 dated January 16th, 1996. And the title is 12 power evangelism and relationship evangelism. 13 It's presented by James Plamondon and Marshall 14 Goldberg. Do you see that? 15 A. I do. 16 Q. Do you know what that refers to? 17 A. The development relations group, DRG, 18 is the group within Microsoft that has as their 19 mission the relationship between Microsoft and 20 the developer community. 21 MR. LAMB: Darin, can you go to the 22 section that relates to evangelism and ISVs? 23 Q. Okay. Apparently, Mr. Plamondon says 24 there are very valuable pawns in the struggle, 25 however. 6805 1 What do you understand he is referring 2 to as they. Is that ISVs? 3 A. Yes. I believe so. 4 Q. Okay. We cannot succeed without them. 5 If you've ever tried to play chess with only 6 the pieces in the back row, you've experienced 7 losing, okay, because you've got to have those 8 pawns. They're essential. 9 So you can't win without them, and you 10 have to take good care of them. You can't let 11 them feel like they're pawns in the struggle. 12 I mean, all through this presentation 13 previously, I talked about how you're using the 14 pawns and you're going to screw them if they 15 don't do what you want, and dah-dah-dah. You 16 can't let them feel like that. If they feel 17 like that, you've lost from the beginning. 18 It's like you're going out with a 19 girl; forgive me, blank, it goes the other way 20 also. You're going out with a girl, what you 21 really want to do is have a deep, close and 22 intimate relationship, at least for one night. 23 And, you know, you just can't let her 24 feel like that, because if you do, it ain't 25 going to happen, right. So you have to talk 6806 1 long term and white picket fence and all these 2 other wonderful things, or else you're never 3 going to get what you're really looking for. 4 So you can't let them feel like pawns, 5 no matter how much they really are. 6 Okay. Now, based on your background 7 and experience and the other documents that 8 you've reviewed and testimony that you've 9 reviewed in this case, what is Mr. Plamondon, 10 in your opinion, suggesting that Microsoft do 11 and how should Microsoft treat ISVs? 12 A. Well, it needs to court them. 13 Q. Okay. 14 A. And it needs to encourage them to 15 think about the future direction of their -- or 16 think -- it causes them to think about their 17 future with Microsoft. 18 Q. Okay. And what's the impact of that? 19 A. Well, it gets them to buy into the 20 Microsoft long-term vision. 21 MR. LAMB: Darin, could you take that 22 off? Okay. 23 Now, could you put up Exhibit 1031? 24 Q. All right. Who's this from, sir? 25 A. Excuse me. From Brad Silverberg. 6807 1 Q. And, again, who is he? 2 A. He is the head of platform 3 development. 4 Q. And who's it to? 5 A. Dawn Tr, I'm not sure. Jon L, Mike 6 Maples, and a few other folks. 7 Q. Who is Mike Maples? 8 A. Mike Maples is the head of the 9 applications division individual. 10 And Pete Higgins is the developer, the 11 head of office development. 12 Q. And the subject here is Excel 13 brainstorm group. Do you see that? 14 A. I do. 15 Q. And this is dated Friday, 18 October, 16 1991. 17 It says, I'd be glad to help tilt 18 Lotus into the death spiral. I could do it 19 Friday afternoon, but not Saturday. I could do 20 it pretty much any time the following week. 21 Do you see that, sir? 22 A. I do. 23 Q. Okay. Was Lotus ever tilted into the 24 death spiral? 25 A. Well, Lotus did not have a good 6808 1 success on a going-forward basis. 2 Q. And did it have anything to do with 3 the undocumented APIs? 4 A. It had some measure of that is the 5 case, I believe. 6 Q. Okay. Explain that to the Jury, what 7 the impact of -- what happened in terms of 8 undocumented APIs. 9 A. Well, there were some interfaces which 10 Microsoft encouraged Lotus to use, Lotus having 11 a competitive spreadsheet program to Excel. 12 Lotus 1-2-3 competed with Excel and 13 Lotus 1-2-3 was encouraged to use interfaces in 14 Windows that Microsoft Excel's developers had 15 concluded were not worthwhile using because 16 they were complicated. They used large amounts 17 of memory. They were slower than other ways of 18 doing it. 19 They made information that would -- or 20 interfaces that would help Microsoft handle 21 larger documents, larger -- Microsoft's 22 products handle larger products, larger 23 spreadsheets, larger word processing documents. 24 Those interface information were not 25 provided to Lotus and to other companies like 6809 1 Lotus, Samna. 2 Q. Okay. Lotus and other companies like 3 Lotus, just so we're clear, Lotus was an ISV; 4 right? 5 A. It was an independent software vendor, 6 yes. 7 Q. Okay. So Lotus would fall into the 8 category of entities that Mr. Plamondon earlier 9 was suggesting that there be some courting to; 10 right? 11 A. That's correct. 12 Q. Okay. And as you reviewed what 13 Mr. Plamondon suggested, was it your opinion 14 that those ISVs should be provided with full 15 information and candor or were they supposed to 16 be withheld information? 17 A. Well, they needed to -- they should be 18 supplied with more information. 19 Q. Okay. And were they in the case of 20 Lotus? 21 A. No, they were not. 22 MR. LAMB: Look at Exhibit 2151, 23 please. 24 Q. Okay. This is from Bill Gates to a 25 series of people, and it's dated October 3rd, 6810 1 1994. 2 And it says it's time for a decision 3 on -- it looks like it says iShellBrowser. Do 4 you see that? 5 A. I do. 6 Q. Do you know what that was? 7 A. Yes. 8 Q. What was it? 9 A. It was a -- it's a description of the 10 name of an interface or a collection of 11 interfaces that begin with I, these remote 12 interfaces -- I'm sorry for the technical term. 13 These interfaces are part of what 14 Microsoft had indicated were going to be 15 something that was a shell extension, an 16 extension to the graphical user interface shell 17 of Windows 95. 18 Q. API interfaces? 19 A. In a word, yes. 20 Q. Okay. And this is from Mr. Gates to a 21 number of his senior executives, such as 22 Mr. Silverberg we talked about, Mr. Allchin, 23 and certainly Mr. Maritz; right? 24 A. Yes. 25 Q. Okay. 6811 1 MR. LAMB: Can we look at the next 2 section, Darin? Darin, you are giving me too 3 much here. Go back. Okay. Okay. Go back to 4 the first highlight. 5 Right there. There you go. Okay. 6 Q. It's time for a decision on 7 iShellBrowser. Okay. 8 MR. LAMB: Just go ahead and give me 9 the whole first half of the document from 10 there. Okay. Down to -- 11 Q. All right. This is what Mr. Gates is 12 saying, okay. 13 This is a tough decision. The Chicago 14 team has done some great work in developing a 15 user interface that will be a big step forward 16 for millions of people. 17 Now, the Chicago team, what does that 18 mean? 19 A. The -- again, going back to code names 20 that we like to use in software development, 21 Chicago was the code name for Windows 95. 22 Q. Okay. Just like Vista and Longhorn? 23 A. Just exactly like that. 24 Q. Okay. The explorer is an important 25 part of this because it provides a real 6812 1 paradigm for finding interesting information. 2 The shell group did a good job 3 defining extensibility interfaces. It is also 4 very late in the day to making changes to 5 Chicago and Capone. 6 Do you know what Capone was? 7 A. Capone, I believe, was the e-mail 8 component, but there were a lot of code names 9 here and I'm -- I think I may have forgot -- it 10 may be the file system. 11 Q. A component to? 12 A. To Windows 95. 13 Q. Windows 95, okay. 14 Mr. Gates goes on to say, it is hard 15 to know how much actual market benefit 16 iShellBrowser integration would bring. I 17 believe Chicago will be very successful either 18 way. 19 Unfortunately, I don't think the 20 integration will have a market effect in terms 21 of Capone competing with CC mail. That 22 indicates it's a mail? 23 A. That's a mail, yes. 24 Q. Okay. So that battle will have to be 25 won on other grounds. This is not to say that 6813 1 there is anything wrong with the extensions. 2 On the contrary, they are a very nice piece of 3 work. 4 He goes on to say, on the other hand, 5 we are in a real struggle versus Notes. What's 6 Notes? 7 A. Lotus Notes. That's a group of 8 collaboration software. 9 Q. Okay. And the Office/Ren team. What 10 does that mean? 11 A. REN is another portion of the 12 applications group, I think, within Microsoft. 13 Q. Okay. That's working on the Office 14 Suite? 15 A. I believe, yes. 16 Q. Okay. That team needs to move as 17 quickly as they can to deliver really rich 18 unified views of information and to provide and 19 exploit storage unification as systems makes 20 that possible. And we need as clear as path as 21 possible to allow them to do that. 22 The REN team has a lot of challenges. 23 And compatibility would be an extra effort for 24 them of at least five man years. 25 What does that mean, compatibility 6814 1 would be an extra effort for them of at least 2 five man years? 3 A. Well, they've got achieving 4 compatibility and maintaining compatibility 5 will require at least five man years of 6 programming development and work. 7 Q. Okay. It goes on to say, if we felt 8 we could expand this team easily to help Office 9 beat Notes, be a source of future shell 10 technology and be compatible, then I would say 11 the extensions are okay. 12 However, the REN team will find it 13 tough to deliver on all of these, even without 14 compatibility. 15 MR. LAMB: Can I get the next section, 16 Darin? 17 Thank you, sir. 18 Q. Okay. He then goes on to say, I have 19 decided that we should not publish these 20 extensions. 21 Okay. What's he saying? 22 A. Well, we will not document these 23 specifications. 24 Q. Okay. And what's the effect of not 25 documenting those extensions? 6815 1 A. They won't be available. 2 Q. And how does that impact ISVs? 3 A. Well, ISVs who were making use of them 4 during the beta phase of Chicago, Windows 95, 5 would have to decommit from them, would have to 6 remove the software that depended on those, on 7 that particular set of APIs. 8 Q. Did it make it easier or harder? 9 A. Well, it was several -- I believe in 10 the case of WordPerfect, it was a substantial 11 amount of time and effort. 12 Q. He goes on to say, we should wait 13 until we have a way to do a high level of 14 integration that will be harder for likes of 15 Notes, WordPerfect to achieve, and which will 16 give Office a real advantage. 17 Do you see that, sir? 18 A. Yes. 19 Q. Is he suggesting that the APIs go to 20 the Microsoft applications group so that they 21 can go ahead and do what they need to do with 22 Office, but withhold it from other ISVs for a 23 period of time to give the applications group 24 an advantage? 25 A. Well, I think it's suggesting that 6816 1 they would be withheld until Microsoft could 2 find a way to more closely or more 3 significantly advantage its applications Office 4 group when using these interfaces than might be 5 available to the other ISVs. 6 Q. Okay. Does that advantage or 7 disadvantage the other ISVs? 8 A. That disadvantages them. 9 Q. Okay. This means that Capone and 10 Marvel can still live in the top level of the 11 explorer namespace, but will run separately. 12 We can continue to use the 13 iShellBrowser APIs for MS provided views such 14 as control panel, and can use them for other 15 MS-provided views that don't create a large 16 compatibility or ISV issue. 17 He goes on to say, I would also like 18 to add a few words about the recent shell 19 reorganization. 20 We have gone from three centers of UI 21 innovation to two. There is a lot of pain in 22 doing this. All three groups were doing 23 excellent work and I hope the Cairo shell and 24 REN can come together to provide the best of 25 both. I think there will be real benefits to 6817 1 be reached. 2 Having the Office team really think 3 through the information intensive scenarios and 4 be a demanding client of systems is absolutely 5 critical to our future success. We can't 6 compete with Lotus and Word Perfect/Novell 7 without this. 8 What is the UI innovation? What does 9 that refer to? 10 A. That's a user interface development 11 centers. 12 Q. Okay. And then he refers to the Cairo 13 shell. What is that? 14 A. Cairo shell was the -- Cairo was a 15 code name for a product or technology that was 16 intended to be the next file system, I believe, 17 at one point in time inside Microsoft. 18 Q. Okay. 19 MR. LAMB: Let's go back to the last 20 screen, please, Darin. 21 Q. Okay. The last bullet point you have 22 here is Microsoft will sacrifice the value of 23 the operating system if it increases the value 24 of Microsoft applications. 25 Do you see that, sir? 6818 1 A. Yes. 2 Q. Can you explain to the Jury what you 3 mean by that? 4 A. Well, in this particular case here, 5 looking at that example, the benefits of an 6 application programming interface that was 7 available and could have done some great work 8 was removed from the operating system from 9 general availability in order to enable the 10 development of Microsoft application software 11 that would have an advantage over competing ISV 12 application software. 13 MR. LAMB: Could we go to the next 14 slide, Darin? 15 Q. Okay. I'm going to read some 16 conclusions of law. 17 I'm going to ask you some technical 18 questions about them, and we're going to look 19 at the conclusions of law in this case and 20 examine Microsoft's behavior from a technical 21 perspective. 22 I would note that these conclusions of 23 law are in the jurors' notebooks. They are in 24 the preliminary jury instructions right after 25 preliminary jury Instruction 31. 6819 1 MR. HOLLEY: Your Honor, may we 2 approach? 3 (The following record was made out of 4 the presence of the jury at 2:47 p.m.) 5 THE COURT: Go ahead. 6 MR. HOLLEY: Your Honor, in the ruling 7 that the court issued yesterday, one of the 8 things that you said that the witness could not 9 offer was opinions on conclusions of law or 10 findings of fact or interpretations of 11 conclusions of law or findings of fact. I'm on 12 page 6488 of the transcript. That's precisely 13 what he's now being asked to do. 14 If they want to ask him what terms 15 mean, then I don't think I object to that. But 16 I don't think it's sufficient to add the word 17 from a technological -- or the phrase from a 18 technological point of view and then have him 19 do precisely what the Court's order of 20 yesterday said he can't do. 21 He is interpreting them at least -- 22 and Mr. Lamb can tell me that's not what he's 23 about to do, but that sure seems like what he's 24 about to do. 25 THE COURT: What are you going to ask 6820 1 him? 2 MR. LAMB: I'm going to read it, Your 3 Honor, and then the next question is: Can you 4 please explain what visible means and user 5 access means. 6 MR. HOLLEY: If all he's going to do, 7 Your Honor, is define terms in them, but that 8 is not quite what he said at the end of his 9 question. 10 He said we're going to look at these 11 from a technological standpoint. 12 THE COURT: Oh, okay. 13 MR. LAMB: Well, I'm entitled to look 14 at their behavior before and after. There's a 15 temporal aspect to this. 16 THE COURT: The question you're 17 proposing is fine right now. 18 MR. LAMB: Yeah. 19 THE COURT: Is there any follow-up 20 question after that? 21 MR. LAMB: Well, there will be. I'm 22 going to ask him what ways Microsoft prevented 23 OEMs like IBM from removing visible means and 24 user access, and we're going to go through the 25 time period. I think that's okay. 6821 1 MR. HOLLEY: I don't think that's 2 okay, Your Honor. 3 THE COURT: What time period? What 4 time period? 5 MR. LAMB: He's going to talk about 6 what time period this occurred, and some of 7 this time period is not within the time period 8 that is related. Okay. That's confined -- 9 THE COURT: To the conclusions of law? 10 MR. LAMB: Yeah. Yes, Your Honor. 11 I'm sorry. 12 THE COURT: Okay. 13 MR. LAMB: I think that the jury is 14 entitled to know, you know, if there's 15 something outside before or after these 16 conclusions of law, and I think I'm entitled to 17 explore that. And I certainly understand he's 18 going to object when he needs to object, but I 19 think it sounds like it's going to be done kind 20 of question by question and depending on where 21 I'm going. And I also think that we probably 22 should let the jury go because I don't think we 23 should get into this right now. 24 MR. HOLLEY: Your Honor, I appreciate 25 the question by question thing, but I also 6822 1 appreciate that this is going -- it's not 2 Mr. Lamb's fault, but it's going slowly. I 3 don't want to be, you know, the jumping jack. 4 THE COURT: This is why we have this 5 procedure. 6 MR. HOLLEY: Right, right. 7 So I think -- my view, Your Honor, or 8 Microsoft's view is it's one thing for him to 9 ask the man questions about what terms mean, 10 and I think the Court said that's fine. 11 They are obviously entitled to ask 12 whether certain conduct occurred before or 13 after the government case, but I don't think 14 that should be done with the conclusion of law 15 up on the screen because it suggests that the 16 collateral estoppel effect extends outside the 17 time period that the jury has been instructed 18 about. 19 So I don't know why those questions 20 have to be asked in connection with, you know, 21 Conclusion of Law 1, 2, 3 and 4 up on the 22 screen. 23 MR. LAMB: Your Honor, I mean, the 24 jury instructions that this Court approved that 25 were posed to this jury specifically say that 6823 1 lawyers may comment on them during the course 2 of the proceedings. Witnesses may be asked 3 questions about them. That's the point. I 4 mean, Microsoft can't have it both ways. 5 We have to be able to comment on them, 6 and we have to be able to use them. I 7 understand that we're not going to go into them 8 and bolster them. And if we're doing that, I'm 9 sure Mr. Holley will object and I'm sure you'll 10 sustain it. I understand your ruling. 11 THE COURT: Well, so far I have no 12 problem with what you're doing. I'll see what 13 the other questions are. 14 Now, is it acceptable to let them go 15 now or do you want to keep going? 16 MR. HOLLEY: Your Honor -- 17 MR. LAMB: Your Honor, I would rather 18 just break. 19 THE COURT: I want to hear what 20 Microsoft says. 21 MR. HOLLEY: Your Honor, if that's 22 plaintiffs' view, it's their examination. And 23 I don't want them to hold Mr. Alepin here if 24 they don't want to hold him here, so I have no 25 objection. 6824 1 MR. LAMB: I was thinking of the jury. 2 (The following record was made in the 3 presence of the jury at 2:52 p.m.) 4 THE COURT: Members of the jury, it's 5 almost time to quit so I'll let you quit early. 6 Don't expect treats like this all the time. 7 Remember the admonition previously 8 given and you can leave your notebooks here. 9 They will be quite safe. 10 We'll see you tomorrow at 8:30 a.m. 11 MS. CONLIN: Tomorrow, Your Honor? 12 THE COURT: I'm sorry. 13 MR. TULCHIN: You'll be lonely. 14 THE COURT: I'm sorry. I'll see you 15 Monday at 8:30. If you are here tomorrow, I'll 16 be the only one here probably. So have a great 17 weekend and drive careful. 18 I'll see you at 8:30 Monday. Thank 19 you. 20 All rise. 21 (The following record was made out of 22 the presence of the jury.) 23 THE COURT: Ms. Nelles, you had 24 something? 25 MS. NELLES: Oh, I do, Your Honor. 6825 1 MR. LAMB: Before we do that, could I? 2 THE COURT: Yes, sir. 3 MR. LAMB: Your Honor, at this time 4 the Plaintiffs would move to admit the 5 following exhibits. 6 THE COURT: Hang on. Go ahead. 7 MR. LAMB: 5735. 24 -- 8 THE COURT: Just a minute. Normally, 9 exhibits are admitted in the presence of the 10 jury. 11 MR. LAMB: Okay. I can do that Monday 12 morning. 13 THE COURT: Why don't we do that 14 Monday. That's how we generally do it. 15 MR. LAMB: All right. 16 THE COURT: So the Jury knows what's 17 been admitted. 18 Ms. Nelles, are you going to kick Mr. 19 Holley? 20 MS. NELLES: I am going to see if one 21 of these kind gentlemen will give me his seat. 22 Mr. Rosenfeld jumped up. 23 THE COURT: Mr. Holley, Mr. Tulchin, 24 you weren't quick enough. So they have to 25 stay; right? 6826 1 MS. NELLES: Actually, I'll take Mr. 2 Tulchin's seat just to make me feel important. 3 THE COURT: Okay. You had some issue 4 regarding the website? 5 MS. NELLES: Yeah. I just wanted to 6 raise with the Court to make sure, as I said, 7 that we're all on the same page about what's 8 going on. 9 I know, you know, this was first 10 addressed I think in last October, and we did 11 it on one of our conference calls, and the 12 Court issued an order, and the order laid out 13 the procedures for how documents were going to 14 be -- that the Court would establish a website 15 and that there would be an opportunity for the 16 parties to so request the procedures. 17 And I understand -- I'm sorry I 18 haven't been here for the past couple times, 19 but that has been -- Ms. Conlin has raised that 20 the Plaintiffs propose to do their own website. 21 And I understand this is in part because the 22 Court has determined that the Court 23 administration is not able to prepare a site. 24 THE COURT: Not able or really not 25 willing, I guess. 6827 1 MS. NELLES: And perhaps I'll come 2 back to this at the end, but I know the Court 3 raised yesterday -- at least it was reported to 4 me that the Court raised yesterday the idea of 5 the parties getting together or hiring a 6 third-party vendor to get that site up for the 7 Court. 8 That may be a solution for some of the 9 concerns I have. I'll come back to it. 10 Let me just address what some of the 11 concerns I have are. 12 And, really, it goes to sort of two 13 levels of evidence. And the idea that this 14 evidence may be presented without some kind of 15 monitoring of procedures by the Court -- and I 16 don't know what Plaintiffs have in mind and 17 perhaps it's entirely unobjectionable, but I 18 did want to state some of the things I think we 19 should be considering before this goes forward. 20 THE COURT: Okay. 21 MS. NELLES: We discussed, I think, 22 last October, and maybe since then a little bit 23 about the procedures that were used in 24 Minnesota. 25 And I'm not suggesting that the same 6828 1 procedures need to be used here, but I think it 2 would be illustrative for me to quickly explain 3 what was done there and why things -- some kind 4 of process is necessary. 5 I think the Court may recall that in 6 Minnesota we had what was called a preadmit set 7 of exhibits. I think it was about 10,000 8 exhibits that comprised about 5,000 that 9 Plaintiffs had designated and about the same 10 amount that Defendant had designated. 11 And here, I think, we have close to 12 twice as many designated. I could be wrong. 13 Mr. Tuggy is the authority on that. 14 But what we did in Minnesota was the 15 preadmitted documents were not to go up on the 16 website. It was only the documents that each 17 day were used in front of the jury or used in 18 openings. We never got to summation, as you 19 will recall. 20 We did settle that case after about 21 seven weeks, but in this case and there I think 22 we probably were contemplating in summation, 23 and that when those documents were used, they 24 were deemed admitted, particularly for purposes 25 of the website and subject to being posted on 6829 1 the website unless there was an objection from 2 either party. 3 And each night a representative of 4 Microsoft and a representative of the 5 Plaintiffs -- and I don't know if Angela is 6 still here -- she is in the back. 7 I think that was Angela, if I remember 8 correctly, but would get together and exchange 9 their list of what had happened each day to 10 make sure they were on the same page, as to 11 which exhibits were at issue. 12 And that would include both Plaintiffs 13 and Microsoft because, of course, Microsoft can 14 also put in evidence and can do so on cross. 15 It doesn't have to wait until Microsoft's case 16 in chief. 17 And we go through and generally there 18 weren't any issues, and sometimes the issues 19 might be related to things like embedded 20 hearsay or perhaps there was some personal 21 information that wasn't subject -- that one of 22 the parties or both of the parties shouldn't be 23 on, and generally it could be worked out. If 24 it wasn't worked out, it was subject to being 25 raised with the Court. 6830 1 And what the parties did was put 2 together basically a PDF and it was posted, and 3 that really isn't very hard. I think Mr. Lamb 4 used the phrase we have the technology a few 5 times today, or at least once, and there's 6 definitely the technology for the website. 7 And I think it was a very good process 8 because, as I said, there are issues here that 9 relate to confidentiality and personal 10 information that should be addressed and 11 because sometimes there are disagreements 12 between the parties as to whether or not an 13 exhibit is in, is it in in toto, is there some 14 kind of issue with embedded hearsay or some 15 portion of the document. 16 And so that was the procedure we used 17 in Minnesota. And, frankly, I think it went 18 pretty well. 19 Now, here we have what I think is 20 going to be a second level of evidence that may 21 be at issue, or at least I think Ms. Conlin or 22 the Plaintiffs are contemplating posting on 23 this website, which would be the documents -- 24 those 3,700 documents that Microsoft is -- and 25 the last I checked in the conference room, a 6831 1 lot of people diligently going through to get 2 through this process of the relevance 3 objections -- and we talked about that before 4 the break. 5 And so very soon, I think, you know, 6 by the 10th, there's going to be thousands of 7 exhibits which Microsoft is not going to raise 8 any additional objection to. 9 And under the Minnesota structure, 10 those would have been sort of considered as 11 preadmit exhibits. They haven't been used yet. 12 They may never be used. But they're there. 13 They are without objection and ready to be used 14 in front of the jury and published for anybody 15 who is in the gallery. 16 But within those documents, some of 17 which perhaps may never ever be used, are all 18 kinds of documents that are highly confidential 19 to Microsoft or to third parties, or I should 20 say, and to third parties. 21 And I think as it was reported to me, 22 or as I heard, yesterday the Court raised with 23 Plaintiffs the idea that what about the 24 protective order. 25 And I think it was a precedent thing 6832 1 to raise. And the response as I heard it was 2 that, well, once it's admitted, it is no longer 3 subject to the protective order. And, 4 actually, I don't believe that's technically 5 correct at all, Your Honor. 6 Excuse me. I have some copies here. 7 I didn't bring my bag up in the shuffle. 8 I note the Court and the Plaintiffs 9 have copies, but I do have a couple extra 10 floating of the protective order. 11 And the protective order says that 12 confidential business records of Microsoft or 13 other business enterprises are subject to the 14 protective order. And the protective order 15 provides the following for exhibits offered in 16 evidence at trial. 17 It says, and this is at paragraph 21, 18 confidential or highly confidential information 19 may be offered in evidence at trial or offered 20 in any hearing subject to procedures to be 21 established by the parties and Court to govern 22 the use and protection of such information. 23 And I think that's what we're talking 24 about here. Establishing procedures to govern 25 the use of protection of this information. 6833 1 THE COURT: I wasn't familiar with the 2 full extent of the protective order, but if 3 that's what it says, I guess we have to indeed 4 establish some procedure to deal with those 5 things that you consider still to be 6 confidential. 7 MS. NELLES: This is a protective 8 order, and I'm going to talk about this 9 document, which is Plaintiffs' Exhibit 3050 in 10 a second as an example. 11 So let me hand that to you and I will 12 take a second to provide a copy to Plaintiffs. 13 THE COURT: You said 21, the 14 reference? 15 MS. NELLES: Paragraph 21, I believe, 16 Your Honor. 17 MS. CONLIN: Your Honor, if I may 18 while she's doing that. 19 MS. NELLES: I've got it, Roxanne. 20 MS. CONLIN: Well, I want to remind 21 the Court that you have already ruled on this 22 issue, Your Honor. You have ruled on this 23 issue. 24 This is another attempt by Microsoft 25 to revisit issues that the Court has clearly 6834 1 explicitly and without question ruled on. 2 You have said that once the exhibits 3 are in the record, they are public, and that, 4 in fact, they would be posted on the Court's 5 website. That's the nature of the order. 6 But we have, of course, learned that 7 there will not be a court website. And, you 8 know, when we talked about this before the 9 break and again yesterday, I said to the Court 10 what I believed to be the law of Iowa, governed 11 also by the Constitution of Iowa, which is that 12 once something is a matter of public record, 13 that it means what it means. Public is public. 14 MS. NELLES: Well, if I may continue, 15 Your Honor. 16 THE COURT: Please do. 17 MS. NELLES: I've provided you with a 18 copy of Plaintiffs' Exhibit 3050. I've also 19 given Plaintiffs a copy of that document. 20 And this is just a quick grab from the 21 set of documents that is an example of a 22 document that hasn't been used. 23 I don't know if it will ever be used 24 with a witness or in summation. It certainly 25 hasn't been used in opening or with a witness 6835 1 yet. 2 I find it hard to believe -- I could 3 be wrong -- but that Plaintiffs will use every 4 page of this document in any event. 5 But here is a document that sets out 6 Microsoft's guidelines and some very explicit 7 information about how Microsoft deals with its 8 customers, how it deals with its competitors. 9 Information that is highly confidential to 10 Microsoft. 11 It's marked as highly confidential. 12 The document itself, never mind before it was 13 an exhibit, is marked confidential just 14 internally. 15 And there really is a concern here 16 about simply posting information for the public 17 to see that is not being used in court. 18 For example, just randomly sort of 19 flipping through this document, if you go to 20 page, say, 27 of this document, as it's 21 originally marked, it's the Bates number 22 038495, there are names, phone numbers, and 23 e-mail addresses of some of Microsoft's 24 business partners and customers. 25 I mean, it's throughout this document. 6836 1 I mean, this is a document that hasn't been 2 shown to the Jury, and may never be shown to 3 the Jury. I really have concerns, and I think 4 the Court should as well, about posting this 5 information. I'm not sure what constitutional 6 or public service need it fulfills to do 7 something like that. 8 There's no doubt here that we need to 9 balance the public's right to know and the 10 confidentiality of business records generally, 11 and that with respect to documents that are 12 used in court, shown to the Jury, used in 13 openings, used in summation, I believe that 14 balance tips in favor of the public's right to 15 know. 16 The public can come in here and watch, 17 and I've never argued that they can't be posted 18 more generally on a website subject to 19 procedures. 20 And since the website was never up and 21 running, we never quite got to procedures. 22 It's not that the Court's ruled on procedures 23 and we are trying to reargue this. 24 I think the very last time we talked 25 about this, the Court was taking it under 6837 1 advisement to get some type of website up and 2 running. 3 And I said -- and I requested, and I 4 believe was granted the right to see that and 5 raise any objections at that point. Simply 6 Microsoft asked for the opportunity to comment. 7 But, you know, we are moving into a 8 different place now because we are not only 9 talking about procedures for a court website, 10 we're talking about a website that apparently 11 Microsoft's going to have absolutely no say in 12 the development of and cannot in any way 13 comment or monitor the accuracy of the 14 information or how the information is being 15 provided. 16 I'd also note in Minnesota -- 17 something we haven't done here -- and that's 18 because it was my understanding there was not 19 going to be a preadmit process in this case, 20 but we allowed that over the past few weeks, 21 and it's my error to not have foreseen that 22 coming, but I assumed that all documents were 23 going to be admitted through witnesses and that 24 at the close of evidence, to the extent there 25 were additional documents that Plaintiffs 6838 1 wanted to provide to the Jury, those would be 2 submitted at that time. 3 So I didn't anticipate the issue quite 4 as well as I should have. But knowing -- in 5 Minnesota, one thing we had, which we do not 6 have here, was a requirement by the Court that 7 every third party be contacted regarding their 8 private confidential information before not 9 only posted on a website, but before it could 10 even be used in the courtroom and be given an 11 opportunity to object -- given a reasonable 12 opportunity to object. 13 And we never asked for such a 14 procedure here. We haven't made any argument 15 about Microsoft's own confidentiality concerns 16 with respect to a single document that 17 Plaintiffs intend to raise in this courtroom. 18 However, I think if we are getting to 19 the point where the Plaintiffs are going to put 20 up a website with no Court oversight whatsoever 21 and post what is probably going to be thousands 22 and thousands of exhibits, or at least they 23 want to post thousands and thousands of their 24 exhibits -- I don't know whether they want to 25 post ours. I sort of doubt it, but what about 6839 1 these third parties? Don't they have a right 2 to know? I think we at least have to have -- 3 THE COURT: Third parties? Which? 4 MS. NELLES: IBM, Apple. 5 THE COURT: They are not a party to 6 this action. 7 MS. NELLES: I'm sorry. You're right. 8 I misspoke. They are not third parties at all. 9 They are nonparties. 10 THE COURT: That's correct. 11 MS. NELLES: What about nonparty 12 confidential information? That is not being 13 used in front of the jury. 14 THE COURT: What about it? 15 MS. NELLES: In Minnesota, the Court 16 felt very strongly that those parties had a 17 right to come in and raise any objection before 18 it was used. 19 THE COURT: If they want to come in 20 and raise objection, they can. They are not 21 here. 22 MS. NELLES: They were not notified, 23 Your Honor. 24 THE COURT: I have no duty to notify 25 them. 6840 1 MS. NELLES: Excuse me? 2 THE COURT: I have no duty to notify 3 them and I'm not going to. 4 MS. NELLES: Well, I think to the 5 extent -- 6 THE COURT: I would spend most of my 7 time notifying hundreds and hundreds of third 8 parties. I'm not going to do it. 9 MS. NELLES: No, Your Honor. We would 10 never seek that from the Court nor was that 11 done in Minnesota. 12 THE COURT: They could intervene at 13 any time they wish. There is no intervention. 14 They are not before this Court. I have no 15 jurisdiction over them. 16 MS. NELLES: Well, Your Honor -- 17 THE COURT: I'm not going to do 18 anything about that. 19 I will look over this protective order 20 signed by Judge Reis signed back in 2003, 21 especially paragraph 21. 22 I'll research the law in regard to 23 confidential documents and whether or not how 24 and when and can they be made public upon 25 admission in the record. 6841 1 So I'll look into that. 2 As far as exhibits being entered, I 3 know some have been admitted already. 4 MS. NELLES: Yes. 5 THE COURT: Was there some 6 confidentiality on those exhibits? 7 MS. NELLES: No, Your Honor. 8 THE COURT: Okay. And so I'll work on 9 that this weekend and I'll get an answer from 10 my research of what I think should be done on 11 that. 12 Was there anything else you wanted me 13 to look at? 14 MS. NELLES: No, Your Honor. I would 15 appreciate that very much. 16 THE COURT: Okay. 17 MS. NELLES: Thank you. 18 THE COURT: And in light of Judge 19 Reis's order, I think I better look at that. 20 MS. CONLIN: Well, Your Honor, may I 21 make a comment? 22 THE COURT: Sure. 23 MS. CONLIN: First of all, this is, in 24 fact, revisiting an issue that the Court has 25 already ruled on. 6842 1 Every single document that Microsoft 2 produced is marked -- almost every single 3 document, and as I've pointed out to the Court 4 before, including matters available publicly, 5 is marked by Microsoft as confidential. 6 To say that they overused that 7 designation hardly covers the situation that we 8 face. 9 The Court said that when a document is 10 introduced and admitted into evidence, it is a 11 matter of public record. That is axiomatic. 12 That is the law. There's just no question 13 about that. 14 And indeed, Your Honor, the whole 15 issue, in my opinion, about the 3,760 16 preadmitted exhibits was based on Microsoft's 17 continuing desire to conceal from the public 18 the full nature and extent of their 19 anticompetitive and otherwise illegal behavior. 20 This is just another way for Microsoft 21 to approach that effort to conceal. 22 If they wanted the Court to establish 23 procedures under paragraph 21, what are we 24 doing six weeks into the trial with that sort 25 of thing? 6843 1 The Court issued that order, Your 2 Honor, months ago, months ago. And here we are 3 at Microsoft's request dealing with something 4 that we never anticipated that we would have to 5 deal with, and here is why. 6 In Minnesota, the documents were 7 marked confidential and indeed sometimes highly 8 confidential and there was simply no 9 confidentiality objection urged to any of those 10 documents at any time. 11 THE COURT: They were all posted? 12 MS. CONLIN: They were posted. 13 But remember, Your Honor, that Court 14 took a much different view than this Court does 15 and than Iowa law does with respect to what is 16 public. 17 The Court took the view that a 18 document was not, in fact, public until it had 19 been referred to in court. And that is not, of 20 course, how we would see the -- that's opposite 21 from what the Court -- this Court has ruled 22 with respect to documents. 23 THE COURT: Yeah. I'd say it's not 24 public until admitted. 25 MS. CONLIN: Until it's admitted. 6844 1 THE COURT: Right. 2 MS. CONLIN: That's right. So that's 3 a substantial distinction between what that 4 Court did and what this Court has already done. 5 And I would just say with respect to 6 3050 -- and this is pretty standard for 7 Microsoft -- they have urged confidentiality 8 for a document that is eight years old, Your 9 Honor. 10 I'm wondering how private these 11 various things are. 12 And I suppose in isolating instances 13 where there are things like Social Security 14 numbers -- and I think there are very few 15 documents. Indeed, I cannot remember any 16 offhand. And I have, in fact, reviewed almost 17 all of them that have, you know, private 18 information of that sort. 19 Certainly, if they come to us and say 20 look at this -- 21 THE COURT: Yeah. 22 MS. CONLIN: -- you know, we'll just 23 be happy to take that off. We don't have any 24 desire to expose people to the possibility of 25 identity theft. 6845 1 THE COURT: Identity theft. 2 MS. CONLIN: That's not what we are 3 after. 4 And when Ms. Nelles said we never got 5 to the procedures under paragraph 21, it is 6 because Microsoft never brought it up. 7 It was their obligation and it should 8 have been brought up in advance of trial, not 9 in the middle of the trial -- or I guess we are 10 not in the middle yet, Your Honor, but in the 11 trial. 12 Ms. Nelles also says that it was her 13 understanding that there was no preadmit going 14 to happen. 15 I have simply no idea how she got that 16 impression. It's flatly wrong. There was 17 never any idea that there would be anything 18 else but the process that we used here, which 19 is once -- if nobody objects to an exhibit and 20 it's offered, boom, it's in. 21 The requirement that every third party 22 be contacted, you've already rejected, Your 23 Honor, and I think that is perfectly 24 appropriate. 25 But I would mention for the Court's 6846 1 benefit, that in Minnesota there was a 2 provision of the protective order with respect 3 to third parties that is absent from the Iowa 4 protective order. 5 So, Your Honor, I think that this is 6 not worthy of your time. I think that it is 7 not something you need to work on over this 8 weekend. 9 I think that Microsoft is, first of 10 all, tardy, and, second of all, their 11 confidentiality stamped on a document by 12 Microsoft does not trump, does not trump Iowa's 13 open court rules. 14 THE COURT: Okay. All right. I'll 15 take a look at it. 16 MS. NELLES: Thank you, Your Honor. 17 Just very briefly -- 18 THE COURT: You'll have an answer. 19 I'm sorry, did you want to say something? 20 MS. NELLES: I just want to say very 21 briefly that the stipulated protective order in 22 this case does indeed include third parties, 23 though as Your Honor has pointed out, we are 24 talking about nonparties here. 25 And we are simply asking for clear 6847 1 procedures going forward. 2 THE COURT: Oh, it talks about third 3 parties? 4 MS. NELLES: It does. 5 THE COURT: Not nonparties? 6 MS. NELLES: Not nonparties. I think 7 we all misspoke a few times back when we were 8 doing the stipulated protective order. 9 THE COURT: All right. 10 MS. NELLES: But simply some clear 11 procedures and particularly for a website 12 that's not going to be monitored by the Court. 13 Thank you. 14 THE COURT: Well, it will be monitored 15 to the extent that, you know, I would assume 16 only those things that are admitted are going 17 to be on there. It's going to be done 18 verbatim, so -- 19 MS. NELLES: I don't know that. I 20 have no idea what Plaintiffs are intending to 21 do on this website, Your Honor. 22 THE COURT: All right. That's what 23 they'll have to do. 24 MS. CONLIN: I've indicated to the 25 Court what we intend to do. 6848 1 MR. HOLLEY: Your Honor, a lot of 2 these documents were produced, as the Court 3 knows, in prior litigation and then they were 4 just, you know, rolled into this giant 5 production in this case. 6 And many of those parties, 7 particularly Hewlett Packard is one that comes 8 to mind -- we've talked about this in the past. 9 They insisted, you know, that they be signed on 10 to the Netscape protective order or the Sun 11 protective order. 12 And they always insisted that they be 13 told when their documents were going to be 14 used. And Mr. Miller, you know, from whatever 15 firm it is in San Francisco, always appears in 16 these cases demanding that his stuff be kept 17 confidential. 18 I just worry that they're going to 19 feel like they didn't get the notice they were 20 entitled to get. 21 It's not the Court's obligation, but 22 the Court can order the parties to notify third 23 parties who thought that their documents were 24 subject to protective orders that their stuff 25 is going to be used. 6849 1 I take Ms. Conlin's point that these 2 documents are getting older and older, but I 3 just know from dealing with Hewlett Packard in 4 the past, they have a very strong view about 5 their confidential information. 6 THE COURT: That was -- as that 7 example, Hewlett Packard, he wanted to be told 8 by you guys or -- 9 MR. HOLLEY: Yes. And so, for 10 example, in the Judge Jackson trial and again 11 in the Judge Kollar-Kottely trial, we were 12 ordered by the Court, or, you know, both 13 sides -- I can't remember exactly how it 14 worked -- were ordered to tell people, hey, 15 your stuff is about to be made public. 16 If you want to say something, you 17 better come and file an application. 18 And my point, Your Honor, is it isn't 19 a purely theoretical notion because some people 20 did come, and they asked that the courtroom be 21 closed. 22 It's a little hard to see how that 23 could happen now given all the time that has 24 elapsed, but they might ask for other 25 protections on their information. 6850 1 Just having negotiated these 2 protective orders with these nonparties and 3 having them out there believing that those 4 documents are still subject to those kinds of 5 protections, I just -- if I were representing 6 one of those companies, I think I'd be a little 7 bit upset if somebody didn't tell me what was 8 about to happen. 9 MS. CONLIN: Well, Your Honor, that 10 really isn't our obligation. 11 And let me also say, remember -- you 12 may not be aware of this, Your Honor, but at 13 the time those third-party documents were 14 turned over, then Microsoft notified those like 15 Oracle and the like. 16 That notification hasn't been given. 17 Every single one of these people know that this 18 trial is in process. I don't know if they know 19 it's in process. They know that there was a 20 case and they know I've got their documents. 21 95 percent of the documents that are 22 exhibits in this case are Microsoft documents, 23 not the documents of anybody else. 24 I can't even think of a Hewlett 25 Packard document that is an exhibit. There may 6851 1 be some, but some of these documents qualify as 2 ancient documents for crying out loud, they are 3 so old. 4 So, Your Honor, I think what Microsoft 5 is raising and it so often does, a straw 6 person, a straw person that they can knock 7 down. This is a red herring. 8 Let me think if there are any other 9 cliches that apply to this. A penny saved is a 10 penny earned. 11 This is basically asking that we 12 simply stop the trial for a couple of months 13 while we mess around with this. 14 And as I said before, Your Honor, it's 15 not worth the Court's time or attention. It's 16 not Microsoft's problem even or mine or the 17 Court's. It's third parties who know that I've 18 got their documents. And if they're paying any 19 attention at all, they know we're in trial. 20 THE COURT: These other agreements, 21 were those agreements entered in between the 22 parties and the ones providing? 23 MR. HOLLEY: Yes, Your Honor. 24 MS. NELLES: Yes, Your Honor. 25 THE COURT: Were they signed by the 6852 1 Court too? 2 MR. HOLLEY: For example, there was a 3 massive protective order that Judge Moore 4 signed. 5 THE COURT: No. I mean in this case. 6 MR. HOLLEY: Oh, in this case, Your 7 Honor. I'll have to defer to someone. 8 THE COURT: Was there an order signed 9 by Artis Reis or myself regarding the 10 third-party or nonparty confidentiality and 11 that the Court was going to notify those 12 people? 13 MS. CONLIN: No. 14 MS. NELLES: Everything is contained 15 in the protective order I've handed you, Your 16 Honor. 17 THE COURT: It's in this one? Okay. 18 MS. NELLES: And Ms. Conlin is 19 correct. In producing the documents, we had to 20 go through many, many, many other protective 21 orders and many which are incorporated and 22 various rulings here and deal with that. 23 But if I could pick a cliche, I'm 24 going to go with a stitch in time saves nine. 25 And just what we are asking here for 6853 1 is just a process that we all know and 2 understand and so that we're all clear what we 3 are doing going forward and we don't run into 4 these issues. 5 THE COURT: Well, a third party as 6 defined in the agreement means any natural 7 person, partnership, corporation, association 8 or other legal entity not named as a party to 9 this action. 10 MS. NELLES: I'm glad to know we all 11 misuse the term. 12 MS. CONLIN: Your Honor. 13 THE COURT: I'll look through it. 14 MS. CONLIN: The order that addresses 15 the issue of the website is your November 2nd 16 order. 17 THE COURT: Right. 18 MS. CONLIN: Just for the Court's -- 19 maybe you already knew that. 20 THE COURT: I have it in front of me. 21 All right. I'll look at this over the 22 weekend. 23 MS. NELLES: Thank you, Your Honor. 24 MS. CONLIN: Thank you. 25 We have a couple of other issues, Your 6854 1 Honor. 2 THE COURT: All right. 3 MS. CONLIN: I'll let you take up mine 4 first because I really need to use the 5 restroom. 6 Mine is we are -- and this is just for 7 the Court's consideration because we are not on 8 top of this issue. 9 But it has come up already a couple of 10 times and so I just wanted to share with the 11 Court our view of it because each time that 12 it's come up, we've been standing over there in 13 the well. 14 When we have to read depositions, and 15 there are several that will be read into the 16 record for which no videotapes exist, the JCCP, 17 and those from trial testimony obviously were 18 not videotaped, we, of course, were also forced 19 to do that in Minnesota, and I recollect one -- 20 this came to a head when Bob Gralewski was 21 reading from James Barkdale's direct evidence, 22 and he was reading in an animated manner and 23 actually used his hands to gesture which 24 brought the wrath of Microsoft down on his head 25 for what Microsoft had termed there and has 6855 1 termed before this court acting. 2 We do not wish to have anyone act out 3 these depositions. 4 However, we would be stunned if it was 5 not permissible for people to use inflection in 6 their voice, as the Court did in reading to the 7 Jury the instructions because otherwise they 8 will be nodding off in the first five minutes. 9 It's unreasonable and unnecessary and 10 unwise to require of those reading the 11 depositions that they do so in a monotone and 12 without moving in any way. And that seems to 13 be Microsoft's desire. 14 And while I can understand it, I would 15 not expect the Court to endorse it because we 16 do have the right to -- it's very unfortunate 17 that we do not have the power to make these 18 people come, but we don't. So we're stuck with 19 what we're stuck with. 20 THE COURT: Well, if I used 21 inflection, it wasn't for any intent to -- 22 MS. NELLES: It wasn't you, Your 23 Honor. 24 MS. CONLIN: You used it in a 25 relatively interesting way. I certainly didn't 6856 1 mean that as a criticism, Your Honor. 2 All you did was, you know, emphasize 3 some words and, you know, I thought it was a 4 perfectly appropriate way to transmit 5 information to the Jury. 6 MS. NELLES: Your Honor, if I may 7 briefly. 8 THE COURT: Go ahead. 9 MS. NELLES: Recently we had the -- I 10 think we all recall in the Gates' video 11 deposition, it became virtually impossible to 12 hear. Ms. Conlin read significant portions of 13 that to the Jury. She certainly used some 14 inflection. I think she did it very 15 appropriately. We had absolutely no concerns 16 with how that was presented to the Jury. 17 I expect Plaintiffs to consider -- to 18 continue using an appropriate amount of 19 inflection. And we simply retain the right to 20 object if they go out of line. But what 21 they've done so far has not been objectionable. 22 THE COURT: Okay. That's fine. Was 23 my inflection objectionable? 24 MS. NELLES: You are never 25 objectionable. 6857 1 THE COURT: I didn't mean for it to be 2 that way. 3 MS. CONLIN: No, no, Your Honor. I 4 just was pointing out that in order for people 5 to -- 6 THE COURT: I'm kind of sensitive. 7 MS. CONLIN: I beg your pardon, Your 8 Honor. 9 MS. CONLIN: I'm sorry, Your Honor. 10 That's the point to be able to transfer 11 information to the jury. 12 THE COURT: You'll be allowed some 13 leeway as far as inflection. 14 MS. NELLES: We agree. We think it's 15 all been appropriate so far. 16 MR. TULCHIN: What happened in 17 Minnesota on that one occasion was 18 Mr. Gralewski was attempting to give emphasis 19 to certain portions of the testimony in a way 20 that we thought was way over the line. 21 In other words, to editorialize about 22 the answers that the witness had given that are 23 on the piece of paper. 24 THE COURT: Okay. 25 MR. TULCHIN: Normally, that's not 6858 1 going to happen. 2 MS. CONLIN: All he did was put his 3 hands up like this (indicating). I was in the 4 courtroom. I remember exactly what happened. 5 MS. NELLES: Perception is always 6 interesting. 7 THE COURT: All right. What's your 8 other issue, Mr. Hagstrom? 9 MR. HAGSTROM: On December 19th, Your 10 Honor, we filed a motion to modify the 11 protective order for the limited purpose of 12 disclosing findings concerning Microsoft's 13 noncompliance with the 2002 final judgment. 14 That was -- required a resistance 15 either this last Friday or this Tuesday. We 16 have not received any resistance from 17 Microsoft, so they are out of time on that. 18 So either we'd like an order issued or 19 I understand Ms. Nelles had contacted Ms. -- 20 well, it looks like I'm being handed some 21 letter. 22 MR. GREEN: Do you want to read that 23 before you go any further? 24 MS. NELLES: That's all right. He can 25 finish. 6859 1 MR. HAGSTROM: Maybe there's some 2 agreement. 3 THE COURT: Which motion was that 4 again? 5 MR. HAGSTROM: Motion to modify the 6 protective order. And as I understand it from 7 Ms. Nelles contacting Ms. Conlin, they weren't 8 going to object, and maybe that's what this 9 letter says. Is that true? 10 MS. NELLES: I sent an e-mail to 11 Ms. Conlin last Wednesday asking her if we 12 could have just until this coming Wednesday. 13 MR. HAGSTROM: This Wednesday of this 14 week? 15 MS. NELLES: Wednesday, yeah, of this 16 week -- Wednesday of next week. 17 And I will admit I wasn't good about 18 being on e-mail during the break. Asking if we 19 could simply have until this Wednesday coming 20 up because we think we are going to be able to 21 resolve this without objection. 22 I asked Ms. Conlin again at lunch, 23 because I hadn't heard from her, whether we 24 could have until Wednesday to try to resolve 25 this without objection. And she wouldn't agree 6860 1 but she said I should talk to Mr. Hagstrom 2 because it was really his issue. 3 And Mr. Hagstrom has been in court and 4 I've been in the back so I just didn't have a 5 moment to discuss it with him, but we've just 6 handed him a letter, and I'll give a copy to 7 the Court as well because it's actually 8 addressed to Your Honor simply asking if we can 9 have until Wednesday to see if we can resolve 10 this without objection. 11 I don't think either Mr. Schulman or 12 the Department of Justice is going to disappear 13 before next Wednesday. So I really don't think 14 this is an issue of prejudice. And nobody 15 should be wasting resources if we can just get 16 this done by agreement. 17 THE COURT: Did you read it, 18 Mr. Hagstrom? 19 MR. HAGSTROM: Pardon me? 20 THE COURT: Have you read the letter? 21 MR. HAGSTROM: No. I just glanced at 22 it. It looks like Microsoft is suggesting that 23 they may be able to agree, but they want an 24 extension to -- 25 THE COURT: Wednesday? 6861 1 MR. HAGSTROM: Pardon me? 2 THE COURT: Until next Wednesday? 3 MR. HAGSTROM: Right. 4 I guess, my question is, I would have 5 thought you can figure out whether or not you 6 can agree by now. 7 MS. NELLES: Well, the honest answer 8 is, Your Honor, it was holidays for us, 9 holidays for people in Redmond and the storm 10 made it -- this is not an issue for these 11 people in the courtroom. It's an issue for the 12 people in Redmond. And we just haven't been 13 able to finish with the correct people, but we 14 will get it done by Wednesday. 15 THE COURT: Okay. 16 MR. HAGSTROM: I guess my only concern 17 is that, on the one hand, they are saying I 18 think we're agreeing, but, on the other hand, 19 we want until next Wednesday to resist. 20 THE COURT: Well, Wednesday it will be 21 either by agreement or the Court is going to 22 decide it. How is that? 23 MS. NELLES: That's fine by Microsoft, 24 Your Honor. 25 THE COURT: Is that okay with you? 6862 1 MR. HAGSTROM: Have a good weekend, 2 Your Honor. 3 THE COURT: Okay. And if you agree 4 before, let him know earlier. 5 MS. NELLES: I promise I will. 6 THE COURT: All right. 7 MR. LAMB: Thank you, Your Honor. 8 (Proceedings adjourned at 3:32 p.m.) 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 6863 1 CERTIFICATE TO TRANSCRIPT 2 The undersigned, Official Court 3 Reporters in and for the Fifth Judicial 4 District of Iowa, which embraces the County of 5 Polk, hereby certifies: 6 That she acted as such reporter in the 7 above-entitled cause in the District Court of 8 Iowa, for Polk County, before the Judge stated 9 in the title page attached to this transcript, 10 and took down in shorthand the proceedings had 11 at said time and place. 12 That the foregoing pages of typed 13 written matter is a full, true and complete 14 transcript of said shorthand notes so taken by 15 her in said cause, and that said transcript 16 contains all of the proceedings had at the 17 times therein shown. 18 Dated at Des Moines, Iowa, this 5th 19 day of January, 2007. 20 21 22 ______________________________ Certified Shorthand Reporter(s) 23 24 25