13188 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 XLVIII 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., February 9, 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 13189 1 A P P E A R A N C E S 2 Plaintiffs by: ROXANNE BARTON CONLIN 3 BRADLEY M. BEAMAN Attorneys at Law 4 Roxanne Conlin & Associates, PC Suite 600 5 319 Seventh Street Des Moines, IA 50309 6 (515) 283-1111 7 MICHAEL R. CASHMAN DANIEL N. WEST 8 Attorneys at Law Zelle, Hofmann, Voelbel, 9 Mason & Gette, LLP 500 Washington Avenue South 10 Suite 4000 Minneapolis, MN 55415 11 (612) 339-2020 12 13 14 15 16 17 18 19 20 21 22 23 24 25 13190 1 Defendant by: DAVID B. TULCHIN 2 SHARON L. NELLES Attorneys at Law 3 Sullivan & Cromwell, LLP 125 Broad Street 4 New York, NY 10004-2498 (212) 558-3749 5 HEIDI B. BRADLEY 6 Attorney at Law Heller Ehrman, LLP 7 333 South Hope Street Suite 3900 8 Los Angeles, CA 90071-3043 (213) 689-0200 9 DAVID E. JONES 10 Attorney at Law Heller Ehrman, LLP 11 One East Main Street Suite 201 12 Madison, WI 53703-5118 (608) 663-7460 13 BRENT B. GREEN 14 Attorney at Law Duncan, Green, Brown & 15 Langeness, PC Suite 380 16 400 Locust Street Des Moines, IA 50309 17 (515) 288-6440 18 RICHARD J. WALLIS Attorney at Law 19 Microsoft Corporation One Microsoft Way 20 Redmond, WA 98052 (425) 882-8080 21 22 23 24 25 13191 1 (The following record was made out of 2 the presence of the jury at 8:32 a.m.) 3 MR. CASHMAN: Your Honor, we have one 4 or two things we would like to discuss briefly 5 before the Jury comes in. 6 THE COURT: Okay. Go ahead. 7 MR. CASHMAN: Good morning, Your 8 Honor. 9 Just briefly, the Court will recall 10 that we argued objections relative to Joachim 11 Kempin some time ago. And the Plaintiffs 12 kindly request the rulings on those so that we 13 can play that deposition coming up here. 14 THE COURT: Yeah. I have -- I only 15 have three more things to look at on that and 16 I'm done. 17 MR. CASHMAN: Okay. Thank you, Your 18 Honor. 19 THE COURT: I've been going through it 20 quite carefully. 21 But can I give it to you this 22 afternoon? 23 MR. CASHMAN: That's fine, Your Honor. 24 THE COURT: Okay. 25 MR. TULCHIN: I don't think, Your 13192 1 Honor, that it was slated to be played today or 2 even next week. I don't know why Mr. Cashman 3 is asking for such a rush. I'm not aware, at 4 least, that it's on the schedule even for next 5 week. 6 THE COURT: Okay. 7 MS. CONLIN: I don't believe that it 8 is, Your Honor. 9 MR. CASHMAN: It's the amount of time 10 that it takes to get the deposition ready to 11 play. 12 THE COURT: I'll have it done today. 13 MR. CASHMAN: Thank you. 14 And then the other issue is, just to 15 wrap up our request yesterday on Mr. Schulman's 16 first deposition and expert report. 17 THE COURT: Oh, yeah. 18 MR. TULCHIN: Your Honor, there are 19 113, or so, I'm told, documents, Microsoft 20 documents, referenced in Mr. Schulman's report. 21 We've tried to go through them. 22 And I don't anticipate any problem, 23 but in order to be sure that we are not 24 agreeing to the release of these things 25 publicly, I wonder if we could have until 8:30 13193 1 Monday morning just to make sure that we can 2 review all these documents. 3 And when I say release them publicly, 4 what's going on here is not that the Plaintiffs 5 want so much to send these materials to the 6 Department of Justice, but they want to post 7 them on their website and issue another press 8 release about them, which is what's been going 9 on with all this Schulman material. There have 10 been a number of press releases. 11 So, under those circumstances, I just 12 would like to be sure that the documents are 13 okay. 14 THE COURT: This is in regard to the 15 first depo; right? 16 MR. TULCHIN: The first deposition and 17 the first expert report. 18 THE COURT: The second one you have no 19 problem with? 20 MR. TULCHIN: The second one has 21 already been out there and it's posted on their 22 website, the whole thing. 23 THE COURT: Okay. 24 MR. CASHMAN: Your Honor, if I just 25 may respond briefly. 13194 1 All the documents which are referenced 2 in Mr. Schulman's report, as I understand, were 3 publicly available. They were from the public 4 record at the time that Mr. Schulman referenced 5 them in his report. 6 So there should be no need for 7 Microsoft to spend an additional three days 8 going through them to determine whether or not 9 they think they are confidential now. 10 And, just briefly, the issue about the 11 use of this -- and Mr. Tulchin I think has 12 mischaracterized things a little bit. And that 13 is when the second deposition was released to 14 the public, Microsoft, we understand, contacted 15 The Des Moines Register and provided a copy of 16 that transcript to The Des Moines Register, 17 which has then been inquiring about it. 18 And Microsoft has been characterizing 19 Mr. Schulman as having changed his mind or 20 changed his position, which is unfair and 21 obviously incorrect given the record, which is 22 one of the reasons why this should not be 23 confidential, the first deposition or his 24 expert report. 25 THE COURT: Very well. Any further 13195 1 argument on this issue? 2 MR. TULCHIN: No, Your Honor. 3 MR. CASHMAN: Not at this time, Your 4 Honor. 5 THE COURT: You said no, Mr. Tulchin? 6 I didn't hear you. 7 MR. TULCHIN: I said no, Your Honor. 8 THE COURT: I don't think the request 9 is unreasonable. We'll take it up at 8:30 10 Monday morning. 11 Anything else? 12 MS. CONLIN: Your Honor, the Court may 13 recall when we had that last witness, not 14 Mr. Edwards, but the one before, the question 15 arose as to whether or not attorneys were 16 permitted to follow up on questions propounded 17 by the jurors, and I went back and looked at 18 the order and it's silent as to that issue. 19 THE COURT: I saw it too. 20 MS. CONLIN: But when I made my 21 original request, Your Honor, and also in the 22 ABA guidelines, in the ALI things, in each of 23 those instances, follow-up questioning is 24 permitted. 25 And my request says if the question is 13196 1 permitted, the Court will ask it and the 2 attorneys may then follow up. 3 And I think that we could have all 4 kinds of difficulty if there isn't an 5 opportunity for follow-up. The witness may or 6 may not answer the question. There may -- it 7 may raise all kinds of other questions. 8 So I think that the brief follow-up is 9 appropriate and probably wise. 10 THE COURT: Okay. Anything else? 11 MR. TULCHIN: I would say, Your Honor, 12 that this is something that might be dealt with 13 on an item-by-item basis; that is, whether 14 follow-up should be permitted might depend on 15 the question. 16 But, of course, if the Court would 17 prefer that there be no follow-up and that's 18 the ground rule under which we all operate, 19 that's fine with us too. 20 THE COURT: I will consider it and 21 issue a ruling today. 22 How's that? 23 MS. CONLIN: Thank you, Your Honor. 24 THE COURT: Is that okay with you? 25 MR. TULCHIN: Thank you, Your Honor. 13197 1 THE COURT: All right. 2 MS. CONLIN: And, Your Honor, also -- 3 in the next weeks, couple of weeks, and maybe 4 even as early as Monday, Plaintiffs wish to 5 read excerpts from documents to the Jury. 6 I know that we can't do that for a 7 great long period of time because no one can 8 stand it, but we'd like to read those DRI 9 documents that have not yet been seen by the 10 Jury. 11 THE COURT: Have they been admitted? 12 MS. CONLIN: Some have been -- almost 13 all have been admitted, Your Honor. 14 There may be some as we go along in 15 order that have not and I'll offer them and, of 16 course, I'll have copies for everybody anyway, 17 but -- if I come to one that is not admitted, 18 we'll handle it in the usual way. 19 MR. TULCHIN: Your Honor, I wonder, if 20 the Plaintiffs intend to do that, two things. 21 I wonder if we could have notice as to what 22 documents they intend to read from; and, 23 secondly, I presume under the rule of 24 completeness that we can at that moment, if 25 they're reading from a particular document, 13198 1 let's say it's Plaintiffs' Exhibit 100, that we 2 can read from portions of it that they haven't 3 read from. 4 When they're done reading 100, we read 5 whatever portions from that same document they 6 haven't read and that we wish to bring to the 7 Jury's attention. 8 THE COURT: Okay. I'll consider it. 9 I'll have an answer for you today or Monday. 10 MS. CONLIN: Thank you, Your Honor. 11 MR. TULCHIN: Thank you, Your Honor. 12 THE COURT: Anything else? 13 MS. CONLIN: No, Your Honor, not from 14 us. 15 THE COURT: Very well. We are going 16 to finish up Mr. -- 17 MS. CONLIN: Harris. 18 THE COURT: Harris. 19 Then where do we go from there? 20 MS. CONLIN: Just a few minutes of 21 Mr. Harris, then Mr. Silverberg. 22 THE COURT: Silverberg, great. 23 MR. CASHMAN: See you, Your Honor. 24 THE COURT: Are you leaving? 25 MR. CASHMAN: I'm leaving. 13199 1 THE COURT: Okay. See you, 2 Mr. Cashman. 3 (The following record was made in the 4 presence of the jury at 8:41 a.m.) 5 THE COURT: Good morning. Everyone 6 else may be seated. 7 Continue with the deposition of 8 Mr. Harris, please. 9 (Whereupon, the following video was 10 played to the jury.) 11 Question: Tell me, what was it that 12 you asked Microsoft to address in this fax, 13 what issue? 14 Answer: I wanted basically a type of 15 clause like a most favored clause. If they 16 give somebody else a better condition, then 17 they give it to me as well. 18 So not the price. I understand price 19 is based on quantity, but the conditions so 20 that everyone could go to market on the same 21 conditions. So a lot of contracts were signed 22 that have got a fair clause in them. 23 Question: But the particular 24 condition that you were concerned about and 25 wanted to address in this fax was the per 13200 1 processor license fee, correct? 2 Answer: Yes. That other people for 3 every CPU that we shipped that they paid a 4 royalty. 5 Question: Now, regardless of whether 6 the response you got was a little woolly around 7 the edges, was there a clear thrust to the 8 response you got from Microsoft? 9 Answer: I do not understand. 10 Question: Whether it was a little 11 fuzzy around the edges, was there a clear 12 thought that was conveyed to you by this fax? 13 Answer: My thought at the time was 14 and is still the same, that it was so woolly 15 that I did not believe it. 16 It didn't convince me, but there was 17 nothing else I could do. They were not going 18 to put anything else. I had to accept it. The 19 deal was done. 20 If it was true, why is there no such 21 thing which says Adam, we can assure you that 22 every single person is the same as you. 23 Nothing exists. 24 Question: Do you have Exhibit 598? 25 Answer: I'm sure I do. Just give me 13201 1 a minute. Got it. 2 Question: I want you to look at the 3 first page. 4 Answer: Okay. 5 Question: Do you have 598 in front of 6 you? 7 Answer: Yeah, I do. 8 Question: Okay. And this is the 9 results of the Opus survey in 1990? 10 Answer: Yes. 11 Question: I want you to look at the 12 first page of the memo. 13 Answer: Yeah. 14 Question: Are you there? 15 Answer: Yeah. 16 Question: The question 5, observation 17 is that 20 or 87 percent of the sample prefer 18 Opus to supply MS-DOS. 19 Answer: Where is that? 20 Question: On the Q5. 21 Answer: Q5, okay. 22 Question: That indicates that 13 23 percent did not prefer that Opus supply MS-DOS, 24 correct? 25 Answer: Yes. 13202 1 Question: That's 13 percent of the 2 market, right? 3 Answer: Yes. 4 Question: Is it fair to say that 13 5 percent of your respondents were at least open 6 to DR-DOS? 7 Answer: Yeah, I think -- I suppose 8 you can read that into it. 9 The bottom line is that 70 percent of 10 our customers did take it. 11 Question: And seemed very well 12 pleased with it, correct? 13 Answer: There were no complaints. We 14 did not lose those customers. We did not take 15 one order and not ship it again. So I don't 16 think even the reference of the 13 percent once 17 it was available to them, they took it. 18 (Whereupon, playing of the video 19 concluded.) 20 MS. CONLIN: Your Honor, that 21 concludes Mr. Harris' deposition. And at this 22 time, we would offer the following exhibits in 23 connection with Mr. Harris' deposition. 24 Plaintiffs' Exhibit 409, Plaintiffs' 25 Exhibit 5085 was previously admitted, 13203 1 Plaintiffs' Exhibit 5276, and Plaintiffs' 2 Exhibit 7528A. 3 May I provide these to the court 4 reporter, Your Honor? 5 THE COURT: You may. And 5085 has 6 been previously admitted? 7 MS. CONLIN: Yes, Your Honor. 8 THE COURT: Any objections to these 9 exhibits? 10 MR. GREEN: I'm going to check, Your 11 Honor. One of them is not on my list that 12 previously was given to us by the Plaintiffs. 13 409 is what has been admitted also 14 according to my records on 11-16. 15 MS. CONLIN: You mean 116? 16 MR. GREEN: I'm sorry, 1-16. 17 5276 has also been admitted. 18 You mentioned four. You only gave me 19 three. 20 THE COURT: 409, 5085, 5276, 7528A. 21 MR. GREEN: 5085 I don't have. 22 THE COURT: That's been previously 23 admitted she states. 24 MR. GREEN: Okay. 25 MS. CONLIN: Yes. 13204 1 MR. GREEN: It was previously 2 admitted. 3 And we have no objections to 7528A, 4 which I think is the only one that has been 5 produced and not admitted. 6 THE COURT: Very well. They are all 7 admitted. 8 Do you have some, Mr. Green? 9 MR. GREEN: Yes, Your Honor. We'd 10 like to offer DX 6745, DX 6746, DX 6747, DX 11 6762, DX 6767, and DX 6786. 12 And we'd also like the Jury to 13 consider in connection with this witness' 14 testimony an exhibit that's already been 15 admitted. And that is PX 5085. 16 THE COURT: Any objection? I'm sorry, 17 go ahead, sir. 18 MR. GREEN: I will hand these up to 19 everybody concerned as soon as I can get 20 through here with my legs and not trip. 21 THE COURT: You can give those to the 22 court reporter. 23 MR. GREEN: Okay. There's three 24 copies. 25 THE COURT: Any objection? 13205 1 MR. GREEN: I might have mixed up the 2 number here. 3 THE COURT: Oh, you did? 4 MR. GREEN: I said 6786 and I should 5 have said 6768. 6 THE COURT: Oh, okay. 7 MS. CONLIN: We have no objection, 8 Your Honor. 9 THE COURT: They are all admitted. 10 MR. GREEN: Thank you, Your Honor. 11 THE COURT: You're welcome, sir. 12 MS. CONLIN: Your Honor, as a part of 13 their case, the Plaintiffs will now play the 14 deposition of Brad Silverberg taken in the case 15 of Caldera versus Microsoft. 16 THE COURT: And the date, please? 17 MS. CONLIN: Yes, Your Honor. The 18 date of the deposition is 10-7-1998. 19 THE COURT: Very well. And let's see 20 if I have a copy here. You may proceed. 21 MS. CONLIN: Thank you, Your Honor. 22 (Whereupon, the following video was 23 played to the jury.) 24 Question: I'm going to ask you 25 questions. 13206 1 You realize that you are under oath; 2 correct? 3 Answer: Yes. I realize I'm under 4 oath. 5 Question: And you also realize that 6 we're videotaping your deposition here and the 7 video could possibly be played in its full or 8 in excerpt to the Jury when we go to trial in 9 this case? You're aware of that? 10 Answer: Yes, I am. 11 Question: Okay. If you don't 12 understand any of my questions today, if you 13 want me to clarify anything, I want you to know 14 that I want to hear that from you so that I can 15 try to help you understand my questions as I 16 ask them to you, okay? 17 Answer: Whatever. 18 Question: Okay. I just want to make 19 sure that we're understanding each other. 20 And to the extent that you don't like 21 my questions or you don't understand them, just 22 let me know and I'll rephrase them, okay? 23 Answer: Whatever. 24 Question: It's a yes or no. 25 Answer: Okay to what? I'm not sure. 13207 1 Question: That if you don't 2 understand my questions, you'll ask me to 3 rephrase them, okay? 4 Answer: Or I'll just say I don't 5 understand it. 6 Question: That would be fine. 7 When did you come to Microsoft 8 Corporation? 9 Answer: I began in 1990. 10 Question: Okay. What month? 11 Answer: I actually started work in 12 like June 26th, something like that. June 13 24th, June 26th. 14 Question: Before that, you had been 15 with Borland, I take it? 16 Answer: Before that, immediately 17 previously I was with Borland. 18 Question: Okay. When you departed 19 Borland, what products were you in charge of? 20 Answer: As far as I know, the entire 21 Borland product line. 22 Question: What was your entry level 23 position at Microsoft in June of 1990? 24 Answer: Vice president. 25 Question: As vice president? 13208 1 And I know that you were immediately 2 put in charge of development of MS-DOS 5.0; 3 correct? 4 Answer: Yes, I was. 5 Question: And also, was Windows 3.1 6 in the works at that point? 7 Answer: Windows 3.0 had just shipped. 8 Question: Windows 3.0 had just 9 shipped, but you were also put in charge of 10 whatever the next version of Windows was going 11 to be, which ultimately became Windows 3.11; is 12 that correct? 13 Answer: Windows 3.0 had just shipped 14 when I actually started work on a full-time 15 basis. 16 Question: You were eventually in 17 charge of Windows 3.1; correct? 18 Answer: And eventually we did ship a 19 product called Windows 3.1. And, yes, I was in 20 charge of it. 21 Question: And eventually Microsoft 22 also shipped a product called Windows 95 and 23 you were also in charge of that; correct? 24 Answer: That is correct. 25 Question: And Microsoft has just 13209 1 shipped a product called Windows 98. 2 And were you in charge of that? 3 Answer: No, I was not. 4 Question: And you're not currently -- 5 are you currently employed by Microsoft? 6 Answer: Yes, I am. 7 Question: But you are on leave? 8 Answer: No. My official status is a 9 part-time consultant. 10 Question: When did the part-time 11 consultant begin? 12 Answer: Officially, my status became 13 part-time consultant sometime in the spring of 14 this year. 15 Question: And are there plans for you 16 to return to Microsoft on a full-time basis? 17 Answer: It's up to me. 18 Question: Okay. Prior to going on 19 sabbatical, you were a member of the executive 20 committee; correct? 21 Answer: Yes. I remained a member 22 afterwards, although I attended only one 23 committee meeting in January. 24 Question: Okay. Who at that point in 25 time -- the day before June 1 of 1997, who was 13210 1 on the executive committee? 2 Answer: Who was on the executive 3 committee? 4 Question: I have it here that it says 5 it's an 8-person executive committee. 6 Answer: Okay. 7 Question: We printed this off in 8 August of '97. 9 Answer: Okay. Let's see if I 10 remember. Well, Mr. Gates, Mr. Ballmer, 11 Mr. Raikes, Mr. Maritz, Mr. Mhryvold, 12 Mr. Allchin, myself, Mr. Higgins. 13 Question: That would be eight. 14 Answer: Yeah. It's perhaps possible 15 that Mr. Vergnes who is the president of 16 Microsoft Europe was on it. I don't know. 17 Question: And this group sets 18 strategy and business planning directions for 19 Microsoft? 20 Answer: I would say primary strategic 21 direction for the company was set by 22 Mr. Ballmer and Mr. Gates. 23 Question: From the Microsoft web 24 page, it says the executive committee is the 25 top decision-making body where he helps set the 13211 1 company's most important strategic and business 2 planning directions. 3 Is that a correct statement? 4 Answer: I gave you my interpretation 5 of how -- you asked the question. I gave you 6 my interpretation of the answer. 7 Question: Okay. And was my statement 8 correct, which was my question to you? Is that 9 a correct statement as well? 10 Answer: The executive committee 11 certainly had a role in it, but the ultimate 12 decision-makers were Mr. Gates and Mr. Ballmer. 13 Question: Okay. 14 Answer: I'd say both statements were 15 true. 16 Question: Then June 1, 1997, you went 17 on sabbatical? 18 Answer: Yeah. 19 Question: Why did you go on 20 sabbatical? 21 Answer: I had been working awfully 22 hard for an awfully long time and I wanted to 23 spend some time with my family. There had been 24 a number of personal activities, family 25 activities, that I had wanted to accomplish 13212 1 that were very difficult when you're working 2 full time at Microsoft. 3 So I took a sabbatical, as many other 4 Microsoft executives are doing or have done. 5 Question: No other reason than that? 6 Answer: That's the primary reason. 7 Question: Were there any 8 disagreements or conflicts that led to you 9 wanting to take a sabbatical and then become a 10 part-time consultant? 11 Answer: I was not happy with the job 12 I had managing the Office group at the time. I 13 needed a break from managing that group. 14 Question: And what was your 15 dissatisfaction there? 16 Answer: Just wasn't a product I was 17 super interested in. 18 Question: Which product are we 19 talking about? 20 Answer: Office. 21 Question: Oh, Office? 22 Answer: Yes. It was a large group. 23 Question: Who was in charge of the 24 product that became Windows 98 at that time? 25 Answer: Windows 98 at that time? I 13213 1 think Mr. Stork or Mr. Veghte. 2 Question: Was that a product that you 3 would have preferred to be working on? 4 Answer: No. 5 Question: What particular products 6 did you want to be working on as opposed to 7 Office? 8 Answer: I was mostly interested in 9 the Internet products. 10 Question: Okay. And who was in 11 charge of that? 12 Answer: I was. 13 Question: And Office was in addition 14 to that? 15 Answer: Yes. I had -- I was 16 responsible for both Office and Internet 17 products. My title at the time was senior vice 18 president of applications and Internet client 19 group. 20 Question: Okay. And just so the Jury 21 understands, the Office product, that's the 22 Office Suite of business applications? 23 Answer: Yeah. There were more than 24 -- we call it Office. It was actually desktop 25 applications division that included more than 13214 1 just Office, but the principal products is 2 Office and the office suite of products. 3 Question: Microsoft's spreadsheet, 4 Microsoft's word processing and -- 5 Answer: Yes. It's called Excel. 6 Question: -- in addition to other 7 things? 8 Answer: Microsoft Excel and Microsoft 9 Word and so on, yes. 10 Question: Okay. When you started at 11 Microsoft in June of 1990, would you consider 12 that Microsoft had a monopoly as far as the DOS 13 market is concerned? 14 Answer: No. 15 Question: Have you ever used the term 16 monopoly in regards to Microsoft's position on 17 the desktop? 18 Answer: Not that I recall. 19 Question: Okay. 20 Answer: Except to say we don't have 21 one. I know I've said that. 22 Question: You have said that? 23 Answer: Yes. 24 Question: You don't recall ever 25 saying to the contrary? 13215 1 Answer: I don't recall, no. 2 Question: Is it going to surprise you 3 to see that you have said to the contrary? 4 Answer: I know I've said we haven't, 5 so. 6 Question: And who would that have 7 been to that you would have saying that? Would 8 you have said that to the Department of 9 Justice? 10 Answer: I don't recall. 11 Question: Well, you recall saying it. 12 Who do you recall saying it to? 13 Answer: I've recalled saying it to 14 people inside the company. I've recalled 15 saying it to the members of the press. If 16 asked by the Department of Justice today, I 17 would say the same thing. 18 Question: To people inside the 19 company, you have said we don't have a 20 monopoly; correct? 21 Answer: Yes. 22 Question: Let me hand you what's 23 Exhibit 1700 to your deposition. 24 Answer: Okay. 25 Question: Please take it and make 13216 1 yourself familiar with it. 2 Do you recall this presentation? 3 Answer: No, I don't. 4 Question: It's dated on the first 5 page May 1990. Microsoft executive staff 6 retreat. 7 So this was immediately prior, the 8 month prior to you starting at Microsoft? 9 Answer: I remember the staff retreat. 10 I don't remember this document at all. 11 Question: Was Mr. Gates there? 12 Answer: Mr. Gates was there. 13 Question: Was Mr. Ballmer there? 14 Answer: Mr. Ballmer was there, yes. 15 Question: Were all of the persons 16 listed here on the first slide, Rubin, Oki, 17 Shirley, Butler, were they all there? 18 Answer: I don't recall Mr. Rubin 19 being there, and I don't recall Mr. Butler 20 being there. I do recall Mr. Shirley. 21 Question: Mr. Shirley was president 22 at the time; correct? 23 Answer: I don't know if that was the 24 case. Hallman had just been hired as 25 president. I think he was officially 13217 1 president. I'm not sure if Mr. Shirley was 2 president at the time or not. 3 Question: Was Hallman there? 4 Answer: Hallman was there, yes. 5 Question: Mr. Shirley had been 6 president. And, to your knowledge, 7 subsequently did he go on to the board of 8 directors? 9 Answer: He is a member of the board 10 of directors today, yes. 11 Question: If you look at -- there are 12 Bates numbers down at the bottom right corner. 13 If you'll go to X 205851. 14 Answer: If you're going to ask me 15 questions about this, I'm going to take time to 16 read the entire document. 17 Question: Sure. Sure. 18 Answer: I'm not going to answer 19 individual questions out of context. 20 Question: I don't want you to do 21 that. 22 Please refresh yourself. 23 Answer: Okay. I glanced through 24 this. 25 Question: Okay. If you'll turn to 13218 1 the Bates number X 205851. It's about a little 2 over halfway through the document. The Bates 3 number shifts over to the side over here. 4 Answer: Okay. 5 Question: First, it says desktop, 6 first line. 7 Could you read that first line, 8 please? 9 Answer: On the desktop, we have a 10 strategic win today, in parentheses, monopoly. 11 Question: And what did you mean by 12 that? 13 Answer: I didn't. What do you mean 14 -- you're assuming I wrote this. I didn't. 15 Question: Let's go back to the first 16 page. 17 It says, a presentation of Rubin, Oki, 18 Shirley, Butler, Silverberg and associates. 19 Answer: Right. 20 Question: Somebody put your name on 21 this without your knowledge? 22 Answer: It was a study group that I 23 was present for. It doesn't say I wrote those 24 words or even agreed with those words. 25 Question: So you didn't agree with 13219 1 those words? 2 Answer: No. 3 Question: But you let it be known 4 that this was a presentation you were 5 participating in with Mr. Gates, Ballmer, 6 Shirley, Hallman and whoever else was there 7 saying that we have a monopoly on the desktop. 8 And you disagree with that? 9 Answer: Yes, that's correct. 10 Question: Okay. Is it typically your 11 business practice to have things that you don't 12 disagree with have your name associated with -- 13 Answer: I hadn't even started work at 14 Microsoft full time at this point. It wasn't 15 my position to state to Mr. Shirley or whomever 16 authored this document that I disagreed with 17 the particular words here or there in a how 18 many pages document? 19 Question: Must be 10 or 15. 20 Answer: It's more than that. 21 Whatever. 22 Question: So you're just sort of a 23 go-along kind of guy and you wouldn't disagree 24 specifically with a superior. Is that your 25 testimony? 13220 1 Answer: I wouldn't say one way or the 2 other. It depends on the situation. In this 3 situation, I didn't say anything. I was mostly 4 an observer at this event, not a participant. 5 Question: Do you recall this now? 6 You say you didn't say anything. Do you -- 7 Answer: Yeah, I don't even recall 8 this work group. I remember that there won't 9 -- 10 Question: Then how do you know 11 whether or not you agreed or disagreed with 12 this? 13 Answer: I don't recall this 14 particular work group. It was not my view that 15 Microsoft had a monopoly. I didn't author 16 these slides. I didn't give the presentation. 17 My position was primarily as an observer at 18 that point. 19 And there would be times I would agree 20 with things or I wouldn't say some things that 21 I disagree with. Sometimes I would. It 22 depends on the circumstances. It depends on 23 the issue. 24 Question: Any idea who did, in fact, 25 write this presentation up? 13221 1 Answer: No. 2 Question: Okay. You don't have any 3 recall of it actually being presented? 4 Answer: No, I don't. 5 Question: You don't have any recall 6 of this particular slide and when it was 7 presented Mr. Gates saying, whoa, wait a 8 second, you're saying we have a monopoly on the 9 desktop, that's wrong? Do you recall that? 10 Answer: I don't recall one way or the 11 other. 12 Question: You don't recall anything 13 about that? 14 Answer: I don't recall the 15 presentation, that's correct. 16 Question: You don't recall anybody 17 saying -- the second line says, we must keep 18 the desktop. 19 Do you recall that? 20 Answer: You're asking the same 21 question over and over again and getting 22 argumentative about it. I've told you I don't 23 recall participating. I don't remember the 24 study group. I don't recall -- I wasn't even, 25 you know, a full-time member of the company at 13222 1 this point. 2 Question: Why were you invited to 3 attend? 4 Answer: Because I had accepted a 5 position. I hadn't actually started. 6 Question: How many of them attended 7 this executive retreat? 8 Answer: VPs attended. VPs and 9 members of the board of directors were invited. 10 Question: How many people did that 11 add up to? 12 Answer: I don't know. 20 maybe. 13 Question: These are the -- 14 Answer: I had accepted a position as 15 a vice president. This was a retreat for vice 16 presidents and members of the board and I was 17 invited. 18 Question: Are there executive staff 19 retreats every year at Microsoft? 20 Answer: I believe so. 21 Question: What is the purpose of 22 these retreats? 23 Answer: You'd have to ask Mr. Gates. 24 He calls the retreats. 25 Question: Okay. Was direction for 13223 1 the company set? 2 Answer: You'd have to ask Mr. Gates. 3 Question: I'm asking you. 4 Answer: Mr. Gates is the one who sets 5 the direction. 6 Question: Okay. Is the direction of 7 the company discussed at these retreats? 8 Answer: Sometimes. 9 Question: Was it discussed in May of 10 1990? 11 Answer: Yes, it was. 12 Question: Was one of the directions 13 discussed making sure that Microsoft maintained 14 control of the desktop? 15 Answer: Not that I recall. 16 Question: The rest of this deals -- 17 back on the first page, indicating that 18 Microsoft is up in Redmond, IBM is down in, is 19 that Boca Raton? Is that where it's located, 20 the development? 21 Answer: I believe so. 22 Question: So this is talking about 23 the relationship between Microsoft and IBM; 24 correct? 25 Answer: What's this? 13224 1 Question: This presentation. 2 Answer: This whole presentation? I 3 don't know. I didn't read it in enough detail 4 to -- that was one aspect of this presentation 5 based on my just quick perusal of it. I 6 wouldn't characterize that as you just did. 7 Question: How would you characterize 8 it? 9 Answer: I'd have to read this 10 document for a couple of hours to understand 11 it. I can take that time if you'd like me to. 12 Question: No. I actually would just 13 rather clarify for the Jury that it would take 14 you a couple of hours to look at a 20-page 15 document and characterize it? 16 Answer: And digest it all, yes, 17 that's correct. 18 Question: What was the relationship 19 between Microsoft and IBM as of May of 1990? 20 Answer: Influx. 21 Question: Going from what to what? 22 Answer: We didn't know. 23 Question: Where had it been prior to 24 this? 25 Answer: Hard for me to say. I wasn't 13225 1 at the company so I couldn't speak firsthand 2 about the relationship between the two 3 companies. 4 Question: If you go to page X 205848. 5 The top slide says divorce, and I do note in 6 the top left corner it says Microsoft and IBM. 7 What does that mean? 8 Answer: What does it mean? 9 Question: In the context of Microsoft 10 and IBM. 11 Answer: I didn't author this 12 presentation. I can't tell you what the author 13 of this presentation -- 14 Question: You've never heard 15 reference to Microsoft and IBM getting 16 divorced? 17 Answer: That wasn't your question. 18 Question: Okay. 19 Answer: Your question was referring 20 to this presentation. 21 Question: Okay. Were there 22 discussions on this retreat about the pending 23 divorce between Microsoft and IBM? 24 Answer: No. There were discussions 25 about the possibility of divorce. Your 13226 1 question stated as -- 2 Question: I don't need -- 3 Answer: Your question said pending. 4 There was no pending divorce at that point. 5 Question: Okay. Well, was there a 6 formal marriage recognized by the state of 7 Washington? I mean, I'm trying to understand 8 -- 9 Answer: There was no pending divorce 10 at that point. 11 Question: You have heard discussion 12 of the phrase Microsoft and IBM getting a 13 divorce; correct? 14 Answer: At the time Microsoft and IBM 15 had some areas of disagreement. 16 Question: Okay. 17 Answer: And it was discussed the 18 possibility of what a divorce might mean. 19 There was no decision to pursue that path, it 20 was just a possibility that was being 21 considered. 22 Question: Did Microsoft and IBM at 23 this point in time, May 1990, let's say June 24 1990, after you've arrived, have disagreements 25 about the direction for what operating systems 13227 1 should continue to be developed and marketed 2 for personal computers? 3 Answer: There were disagreements, 4 yes, between the two companies. 5 Question: Okay. IBM wanted to 6 continue developing and improving and marketing 7 OS/2; correct? 8 Answer: They did want to do that. 9 I'm not -- I don't know the full nature of the 10 disagreements between the two companies because 11 that was not part of my responsibility. 12 Question: Microsoft as of June 1990 13 wanted to place the development emphasis on 14 Windows; correct? 15 Answer: No, that's not correct. 16 Question: Where did Microsoft want to 17 put the emphasis? 18 Answer: Microsoft's emphasis in June 19 of 1990 was on OS/2 and on NT. 20 Question: Was there a disagreement 21 between Microsoft and IBM about what role 22 Windows would play? 23 Answer: I don't know at that point. 24 Question: Did there ultimately come 25 to be disagreement about that? 13228 1 Answer: Yes. 2 Question: When? 3 Answer: I don't recall when that 4 began. 5 Question: Could have been as early as 6 June 1990? 7 Answer: I don't believe so. 8 Question: Okay. 9 Answer: I don't recall it being then. 10 At that point in Microsoft, 11 Microsoft's operating system strategy was 12 focused around OS/2. 13 Question: Did that strategy change? 14 Answer: A number of years later. 15 Question: Okay. What did it change 16 to? 17 Answer: Ultimately it changed to 18 Windows and Windows NT, but it was -- there was 19 a couple years before that occurred. 20 Question: Okay. You referred just 21 then to Windows and Windows NT. Can you 22 explain for the Jury what the difference -- 23 when you refer to one as Windows and one as 24 Windows NT, what are the distinguishing 25 characteristics of each? 13229 1 Answer: They were different code 2 bases, they were different development teams. 3 Question: And it's something Windows 4 -- when you made the distinction between 5 Windows and Windows NT, am I correct in 6 assuming that when you referred simply to 7 Windows, you're talking about a graphical user 8 interface that runs on top of DOS? 9 Answer: No. I was referring to the 10 Windows 3.1 operating system. 11 Question: Did Windows 3.1 require 12 MS-DOS or some DOS to be of any use to the end 13 user? 14 Answer: Windows 3.1 did require 15 MS-DOS or PC-DOS. 16 Question: Whereas, Windows NT did 17 not? 18 Answer: Windows NT does not. 19 Question: If I ask you as to any 20 particular year about MS-DOS market share, are 21 you going to know an answer? 22 Answer: No, I won't. 23 Question: You're in charge of MS-DOS, 24 but you're not -- you'd have no recall of what 25 market share was? 13230 1 Answer: That's correct. 2 Question: Okay. Were you concerned 3 about whether MS-DOS was doing well or not well 4 in terms of market share? 5 Answer: I was concerned in terms of 6 how well it was doing in terms of popularity or 7 revenue. Market is very broad. 8 Question: Market is very broad? 9 Answer: Yes. 10 Question: Why is that? 11 Answer: Because the market for 12 operating systems is a very broad market. 13 Question: Okay. Have you ever heard 14 of the term MS-DOS market or DOS market? 15 Answer: I don't know. I just heard 16 it right now. 17 Question: Of course, you did. 18 Have you ever heard it from anybody 19 inside Microsoft? 20 Answer: I don't recall. 21 Question: Did you ever hear Brad 22 Chase, Rich Freedman, or Mark Chestnut refer to 23 it? 24 Answer: I don't recall. 25 Question: Okay. So we would be 13231 1 unable to have a conversation about the MS-DOS 2 market because you disagree that there is such 3 a market? 4 Answer: I would define market much 5 more broadly than you would. 6 Question: Okay. What about the 7 Windows market? Would you agree that there is 8 a Windows market? 9 Answer: Similar answer. 10 Question: Similar answer? 11 Answer: Yes. 12 Question: If someone was to refer to 13 having a certain percentage market share of 14 Windows, do you know what that would mean? 15 Answer: I'd have to look at the 16 specific instance and see if I could refer 17 whether the term market was used in a 18 colloquially loose manner or a specific legal 19 manner. 20 Question: Are you a lawyer? 21 Answer: I'm not. 22 Question: Do you work with lawyers 23 frequently? 24 Answer: Not frequently. On occasion. 25 Question: So colloquially within 13232 1 Microsoft people might be talking about high 2 market share and narrowly defining markets, but 3 when it's in a legal sense, then Microsoft, you 4 would define it much more broadly so that the 5 market share looks lower? 6 Answer: No, that's not -- you're 7 putting words in my mouth. 8 Question: No, I'm just giving you a 9 statement and you can tell me you disagree with 10 it or not. 11 You disagree with that? 12 Answer: I disagree with that, yes. 13 Question: But you did just say that 14 colloquially within Microsoft sometimes people 15 refer to -- 16 Answer: It's possible, yes. On 17 occasion it's possible, yes. 18 Question: Let me hand you what's been 19 marked as Exhibit 1701. 20 And please take some time to refresh 21 yourself on this. 22 Answer: Okay. 23 Question: Okay. This is an e-mail 24 from within Microsoft; correct? 25 Answer: That's what it appears to be. 13233 1 Question: Okay. 2 Answer: I have no recollection of the 3 document. 4 Question: Okay. I'm going to 5 represent to you that I didn't type this up 6 myself and sign your name to it; okay? 7 Answer: I wasn't the author of it. 8 Question: Well, you forwarded it to 9 somebody. And it does indicate at the very 10 top, from Brad Silverberg to richt; correct? 11 Answer: That is correct. 12 Question: Brad Silverberg is you? 13 Answer: There is some other things 14 that were forwarded. And I was not the author 15 of, correct? 16 Question: And I'm getting to that, 17 but I'm just -- below that, then, is from Paul 18 Maritz to Bradc, which that's your e-mail? 19 Answer: Bradsi. 20 Question: Bradsi, is that -- 21 Answer: Bradc is Brad Chase. 22 Question: Bradc is Brad Chase. Brad 23 squared is when we refer to both of you, I 24 guess. 25 Joachimk is Joachim Kempin; correct? 13234 1 Answer: I'm sorry. 2 Question: Joachimk is Joachim Kempin? 3 Answer: That's correct. 4 Question: Who is in charge of OEM 5 sales? 6 Answer: I believe so. 7 Question: And Mikemap is Mike Maples? 8 Answer: Mike Maples, yes. 9 Question: Steveb is Steve Ballmer? 10 Answer: Steve Ballmer, yes. 11 Question: All executives; correct? 12 Answer: Yes. 13 Question: And Paul Maritz, what is 14 his -- 15 Answer: Maritz. 16 Question: I'm sorry, Paul Maritz. 17 And this is dated in February of 1993. 18 At that time what was Paul Maritz's 19 position, if you recall? 20 Answer: I'm not sure, not 100 percent 21 sure. 22 Question: Did you report to him at 23 the time? 24 Answer: It's possible. I did report 25 to him sometime in 1993. I don't recall at 13235 1 what point I began reporting to him. 2 Question: But he was an executive of 3 Microsoft at that time; correct? 4 Answer: Yes, he was. 5 Question: An officer; correct? 6 Answer: Yes, he was. 7 Question: And who is Richt? That's 8 who you're forwarding this to. Is that Rich 9 Tong? 10 Answer: Richt would be Rich Tong, 11 yes. 12 Question: And is he a marketing 13 person? 14 Answer: He was a marketing person, 15 yes. 16 Question: For Windows; correct? 17 Maybe some other things too, but at least for 18 Windows? 19 Answer: I don't know what his 20 position in 1993 was. 21 Question: And you're forwarding it 22 saying this is perfect for Lizw. Do you know 23 who Lizw is? 24 Answer: Liz Welch. 25 Question: And who was she? 13236 1 Answer: I don't know what her 2 position at the time was. 3 Question: Was she a PR person or 4 marketing? I mean, I have no idea who she is, 5 so I'm just wondering what type of 6 responsibilities she had. 7 Answer: At that point I have no idea 8 either. 9 Question: What ultimately -- what 10 familiarity do you have with any of her 11 responsibilities at any point in time? 12 Answer: Well, when I first joined the 13 company, she was a marketing person somewhere 14 in Word, I think. And today I think she has 15 something to do with educational sales. What 16 she did in between, I have no recollection. 17 Question: Mr. Maritz's e-mail to you 18 and to others begins, the following trends are 19 fairly obvious for systems software revenues in 20 the coming years. 21 1, Windows has become an OEM 22 phenomenon. We have 80 percent plus market 23 share. 24 Do you have any idea what he was 25 referring to there? 13237 1 Answer: You'd have to ask Mr. Maritz. 2 I don't know what he means there. 3 Question: Do you recall e-mailing him 4 back and saying what do you mean by 80 percent 5 plus market share for Windows? 6 Answer: No, I don't recall not doing 7 it either. 8 Question: Do you -- considering -- 9 sitting here now in 1998 thinking back on 10 February 1993, do you think that Windows had 80 11 percent plus market share? 12 Answer: No. 13 Question: And what basis do you have 14 for believing that it did not have 80 percent 15 plus market share? 16 Do you recall percentages? 17 Answer: I don't recall specific 18 percentages. I don't believe -- well, first of 19 all, I don't believe Mr. Maritz was correct in 20 terms of the rate of adoption by OEMs of 21 Windows at that point. 22 I don't think as many -- my 23 recollection is not as many OEMs as perhaps he 24 may be trying to represent here was true. 25 The Macintosh was very popular in 13238 1 1993. 2 There's still OEMs who are shipping 3 their machines without Windows on it. IBM was 4 shipping quite a number of machines with OS/2. 5 There were many other operating 6 systems that were shipping. That Microsoft 7 share, the percentage of Windows compared to 8 that was not anywhere close to 80 percent. 9 Question: When you say it was not 10 anywhere close to 80 percent, what was it close 11 to, in your opinion? 12 Answer: I wouldn't want to hazard a 13 guess without data. 14 Question: Okay. You can't -- but 15 you're confident it wasn't 80 percent? 16 Answer: It doesn't seem right at all 17 to me, no. That's correct. 18 Question: Mr. Silverberg, when you 19 started at Microsoft in June of 1990, did you 20 have an opinion about the quality of MS-DOS as 21 a product at that time? 22 Answer: Yes, I did. 23 Question: What was that opinion? 24 Answer: Low. 25 Question: Why is that? 13239 1 Answer: Well, MS-DOS 4, PC-DOS 4 were 2 flops in the market, and deservedly so. 3 Question: And -- well, go ahead if 4 you want to continue on. 5 Answer: Customers didn't buy it. 6 OEMs didn't pick it up. 7 Question: And do you know why -- 8 Answer: Got bad reviews. 9 Question: Do you know why that is, 10 that customers and OEMs weren't buying it? 11 Answer: I had my opinions. 12 Question: Okay. Can you give me your 13 opinions? 14 Answer: Eight years later, I can't 15 recall them all. They're ancient history. 16 Question: Okay. I'm going to hand 17 you some ancient history that has been marked 18 as Exhibit 1702, and your name is on the first 19 page. 20 Please take a moment to glance through 21 it. 22 Do you recall this document? 23 Answer: No, I do not. 24 Question: Okay. Before we continue 25 with this document, were you aware when you 13240 1 started at Microsoft of Digital Research and 2 its efforts in trying to bring versions of 3 DR-DOS to the market? 4 Answer: Can you restate the question? 5 Question: I take it in June of 1990 6 you knew who Digital Research was? 7 Answer: I've heard of Digital 8 Research, yes. They were a CP/M. 9 Question: They also wrote DR-DOS; 10 correct? 11 Answer: Yes, they did. 12 Question: Okay. When you started at 13 Microsoft in June of 1990, were you aware of 14 DR-DOS? 15 Answer: I don't know. 16 Question: Don't recall whether you 17 ever even had heard of it at that point? 18 Answer: I may have heard of it, yeah. 19 It's possible. 20 Question: I mean, when I use the term 21 DR-DOS, you know what I'm talking about, don't 22 you? 23 Answer: In 1998, yes. 24 Question: Okay. Well, in 1991, you 25 knew what DR-DOS was; correct? 13241 1 Answer: Yes. 2 Question: Okay. If you'll look at 3 the third page of what was marked as Exhibit 4 1702. 5 Answer: I didn't see the word DR-DOS 6 in this presentation in my quick reading of it, 7 though. 8 Question: I didn't -- it's not in 9 this presentation, to my knowledge. I'm just 10 asking you some questions about it. 11 There's a page here that says -- 12 Answer: Which page are we on? 13 Question: Third page, MS7019565, and 14 it's got some pictures on it. Actually, I 15 guess we need to clarify some things about this 16 document. 17 You don't recall this document, I 18 believe you said? 19 Answer: That is correct. 20 Question: Do you recall when you 21 might have given this presentation? 22 Answer: I don't recall this document. 23 I don't recall whether it was ever presented. 24 You made an assumption that there was a 25 presentation given. I don't recall whether 13242 1 that occurred or not. 2 Question: When you -- 3 Answer: I notice the document isn't 4 dated. 5 Question: It's not dated. 6 Answer: Or I didn't see a date on it. 7 Question: Now, are these -- this type 8 of document, we looked at the previous exhibit 9 and we agreed, I believe, that it was a 10 Microsoft e-mail. 11 Answer: Which one? 12 Question: Exhibit 1701. It's this 13 one here. 14 Answer: This one here? 15 Question: Yeah. That's an e-mail. 16 It's not a letter. It's not a whatever. It's 17 an e-mail, correct, that's been printed off, 18 and that's why it looks like that; right? 19 Answer: That is correct. 20 Question: This type of document that 21 has these slides, I take it that this is a hard 22 copy of slides that could be used for an 23 overhead projector or something like that if 24 they were on transparent sheets; correct? 25 Answer: It could be used for that. I 13243 1 don't know that's what it was used for. It 2 appears to me it may have been a PowerPoint 3 presentation, which doesn't require 4 transparencies. It could have just been notes 5 to myself. I don't know. 6 Question: Okay. But a PowerPoint 7 presentation, what is PowerPoint? Explain to 8 the Jury what that is. 9 Answer: PowerPoint is a program 10 developed and sold by Microsoft for producing 11 -- one of the uses is for producing 12 presentations. 13 Question: Okay. And when you prepare 14 something with PowerPoint -- 15 Answer: It may be for your own use 16 also. 17 Question: Correct, you can prepare it 18 for your own use and put it in your files. 19 But one of the uses is to prepare 20 things so that you can present it to large 21 audiences and perhaps have speaking points to 22 work from; correct? 23 Answer: Or small audiences or to 24 nobody, that's right. 25 Question: Correct. All right. So 13244 1 the third page says, your old DOS. Whether 2 this was -- are you in the habit of making -- 3 using PowerPoint to put graphical things on a 4 PowerPoint presentation and then just tucking 5 it away in your files? Is that something you 6 do as a business practice? 7 Answer: I have done, sure. 8 Question: So, in fact, that might be 9 all this is? You might have put Brad 10 Silverberg, vice president systems on the first 11 page and then done a little presentation to 12 yourself and put it in your files; correct? 13 Answer: That is correct. Since I 14 don't recall the document, I can't tell you how 15 it was ever used, if it was ever used. 16 Question: And, in fact, I mean, do 17 you suspect having reviewed this that somebody 18 else prepared it and simply put your name on 19 top of it? Is that a suspicion that you might 20 have? 21 Answer: It's certainly a possibility. 22 It has happened numerous times where people do 23 prepare presentations, put my name on it. 24 Sometimes I don't ever see it. And it may have 25 been filed away. I don't know. 13245 1 Question: I mean, is that something 2 that runs rampant at Microsoft, that people put 3 their names on other people's stuff and file it 4 away or circulate it? 5 Answer: That's a silly question. 6 Move on to the next question. 7 Question: I'm going to ask you the 8 question again and I'll ask you to answer it. 9 Answer: Sometimes people will prepare 10 presentations for other people to give and 11 sometimes a presentation may be cancelled and 12 maybe plans change and never be given. 13 Question: On the third page there's a 14 picture, and correct me if I'm wrong, it looks 15 like a face of a pig, a typewriter and a bottle 16 of poison. 17 Any idea having reviewed this document 18 what that might mean? 19 Answer: Well, when I read this 20 document just now, I had a feeling what the pig 21 stood for. I didn't know what the typewriter 22 or the bottle stood for. 23 Question: What do you think the pig 24 stands for? 25 Answer: The pig -- I think the pig 13246 1 pretty well in my mind stands for MS-DOS and 2 PC-DOS 4 were pigs, memory pigs. 3 Question: Memory hogs? 4 Answer: Among other things. They 5 were just pigs. 6 Question: Slow? 7 Answer: They were slow, memory hogs. 8 Just products, like I said, I didn't think very 9 highly of them. 10 Question: Okay. You may have guessed 11 I'm not in the software business. Is that a 12 term of art, whether derogatory or not, if you 13 call some other software a pig -- 14 Answer: I don't recall this drawing. 15 Question: Oh, derogatory. But if you 16 say something is a pig and you're referring to 17 software, does that have a special meaning 18 that's understood by software people? 19 Answer: I wouldn't say it has special 20 meaning. I mean, it's a pig. It's a memory 21 hog. That's one aspect of it. It's certainly 22 rarely a sign of affection. 23 Question: Okay. And so it says your 24 old DOS, a pig. And that is in line with your 25 opinion about old versions of DOS when you came 13247 1 on board at Microsoft; correct? 2 Answer: No. 3 Question: MS-DOS 4.0? 4 Answer: MS-DOS 4. 5 Question: And that's all? 6 Answer: Yes. 7 Question: Okay. And that was the 8 most recent version that had been developed and 9 brought to market by both Microsoft and IBM; 10 correct? 11 Answer: I think 4.1 was -- 12 Question: Is it 4.1 or 4.01 was 13 Microsoft's? 14 Answer: I remember it as 4.1. 15 Question: Okay. 4.X, whatever. 16 Version 4 was the one that had currently been 17 brought to market? 18 Answer: That was the one that had 19 been made available to customers. 20 Question: Okay. Who had primarily 21 designed and coded MS-DOS 4? 22 Answer: It was developed before I was 23 at Microsoft. My understanding is that it was 24 developed primarily by IBM. 25 Question: Okay. 13248 1 Answer: MS-DOS 4 was. And Microsoft 2 made some changes, some improvements for MS-DOS 3 4.X, whatever that X is. X not equals zero. 4 Question: And the typewriter; do you 5 have an understanding or an opinion about what 6 that might mean in the context of its use in 7 this document? 8 Answer: I'd have to -- you know, I'd 9 have to read this document more carefully. 10 Otherwise, it would just be a speculation. 11 Question: Okay. I saw noted a little 12 bit later on a page, MS7019572, it's referring 13 to ease-of-use utilities. 14 Answer: Are you asking me to look at 15 that page? 16 Question: Yeah, would you look at 17 that page, please? It's where I also see a 18 typewriter graphic. 19 Answer: This page here? 20 Question: Yeah. Ease-of-use 21 utilities, was that a goal for MS-DOS 5? 22 Answer: Having ease-of-use utilities 23 was a goal for MS-DOS 5, yes. 24 Question: Did you have an opinion 25 whether MS-DOS, PC-DOS 4 or MS-DOS 4.1 was not 13249 1 easy to use? 2 Answer: Certainly the shell in MS-DOS 3 4, PC-DOS 4 was poor and it was lacking these 4 other ease-of-use utilities. These were all 5 new. 6 Question: And then the last graphic 7 back on that third page, which is also there, 8 is that a bottle of poison, or do you have an 9 understanding of what that might be? 10 Answer: Could be. 11 Question: It's got a skull and 12 crossbones on a bottle. 13 Answer: It could be medicine, just 14 medicine. Not necessarily poison. 15 Question: With a skull and 16 crossbones, okay. 17 Do you have any idea what that means? 18 Answer: Only from what I see here, 19 no. It refers to some additional capabilities 20 -- this page with this picture refers to some 21 capabilities we put in MS-DOS 5. 22 Question: Okay. Was MS-DOS 5.0 when 23 it shipped a bug-free product? 24 Answer: No. 25 Question: Is there really such a 13250 1 thing in the software industry as a bug-free 2 product? 3 Answer: I'm not aware of any products 4 that are -- 5 Question: I mean, when a product -- 6 I'm sorry. 7 Answer: -- 100 percent totally 8 bug-free. 9 Question: Okay. Microsoft, in fact, 10 shipped MS-DOS 5.0 knowing that there were some 11 bugs in it, correct, Mr. Silverberg? 12 Answer: Yes. 13 Question: Did you say yes or I guess? 14 Answer: Yes. 15 Question: Why did you ship it knowing 16 there were bugs in it? 17 Answer: Going back to your previous 18 statement, there's no such thing as a product 19 without any bugs, as a software product without 20 any bugs. 21 Question: But you knew there were 22 some bugs in there? When it was going to be 23 released, you knew there was going to be some 24 bugs? 25 Answer: Yes. 13251 1 Question: Why didn't you have those 2 bugs fixed? 3 Answer: As with any software product, 4 you can't fix everything. You'll never ship 5 any product. No product in the history of 6 software will ever have shipped if every known 7 bug was fixed. 8 You have to make a judgment call in 9 terms of which ones are appropriate to fix and 10 which ones are not. 11 Question: Which ones are appropriate 12 to fix? 13 Answer: The ones -- again, it 14 involves judgment calls. You can't know 15 everything that your product is running on. 16 You can't anticipate every scenario, 17 every eventuality, every piece of hardware that 18 may be developed after the product is shipped, 19 every application that may be developed after 20 it shipped. You can't know all those things 21 ahead of time. 22 The ones -- the bugs that we are most 23 concerned about are ones that cause data loss. 24 Question: Who is Mike Dryfoos? 25 Answer: Mike Dryfoos was a 13252 1 development manager for MS-DOS. 2 Question: Okay. And was he in charge 3 of overseeing and resolving bug fixes with 4 MS-DOS 5.0 as it was getting ready for 5 shipping? 6 Answer: I don't know. 7 Question: Okay. Was he in charge of 8 making the call as to what bugs would get fixed 9 and what bugs didn't get fixed? 10 Answer: Some occasion, yes; some 11 occasion, no. 12 Question: Who did that call usually 13 go to? 14 Answer: There was a group called 15 DOSwar that had that responsibility 16 collectively. 17 Question: And I think we've 18 established that a severe bug is one that leads 19 to data loss; correct? 20 Answer: I would characterize a bug 21 that causes data loss as a severe bug, yes. 22 Question: What other -- 23 Answer: I would characterize a 24 cosmetic bug as not a severe bug. 25 Question: What's a cosmetic bug? 13253 1 Answer: Oh, a pixel off here or 2 there, and off by one error in terms of 3 displaying some information. 4 Question: And for the Jury, a pixel 5 being what? 6 Answer: An element on the screen, a 7 bit of color or light, one element. The screen 8 may be 640-byte, 480 pixels wide or whatever. 9 Just something that's painted. Like this 10 picture of a pig, I would consider that a 11 cosmetic bug. 12 Question: Okay. What is it that 13 causes bugs to exist in a product? 14 Answer: Many, many reasons causes the 15 bugs to exist. I mean, you could spend a year 16 studying the causes of bugs. 17 Question: I mean, does it mean that 18 there's a coding problem? 19 Answer: Perhaps. 20 Question: What else could it mean? 21 Answer: Faulty assumption, timing 22 problems, not understanding hardware, not 23 understanding software properly, not 24 understanding what another piece of code that's 25 supposed to interact with does. It's a fairly 13254 1 loose term. 2 Question: Does the likelihood of a 3 bug occurring increase as features are added? 4 Let's refer specifically to operating systems. 5 As features are added to an operating 6 system, does the likelihood of encountering 7 bugs increase or decrease? 8 Answer: Not necessarily. 9 Question: Okay. Would that just 10 depend on how careful coders are and the amount 11 of time they have to work on the product? 12 Answer: That would be one factor. I 13 wouldn't characterize the issue. 14 Question: As features are added to an 15 operating system, does it become more complex? 16 Answer: Can be. It depends on 17 whether -- it can be. 18 Some have to do with the design of the 19 product itself, how well it anticipated the 20 future. 21 (Whereupon, playing of the video 22 adjourned.) 23 THE COURT: We'll take our recess at 24 this time for ten minutes. 25 Remember the admonition previously 13255 1 given. 2 All rise. 3 You can leave your notebooks here. 4 (A recess was taken from 9:48 a.m. 5 to 10:02 a.m.) 6 THE COURT: Everyone else may be 7 seated. 8 Please continue, sir. 9 (Whereupon, the following video was 10 played to the jury.) 11 Question: After MS-DOS 5.0 shipped, 12 Microsoft released an update called MS-DOS 13 5.0a; correct? 14 Answer: I believe so. 15 Question: And that was a silent 16 update, as Microsoft terms it? 17 Answer: I don't recall. 18 Question: Were bugs fixed in MS-DOS 19 5.0a? 20 Answer: I don't recall what the 21 contents of 5.0a was. 22 Question: Why was it called 5.0a? 23 Answer: Because it wasn't 5.0. 24 Question: I know, and it wasn't 5.1, 25 was it? 13256 1 Answer: Yeah, I don't recall the 2 reasons. 3 Question: All right. Now, I believe 4 you testified that data loss is the most severe 5 bug that software could have; correct? 6 Answer: I don't think I'd put it in 7 those words. I said data loss is a severe bug, 8 yes. 9 Question: Okay. What's the most 10 severe? 11 Answer: Well, a bug that would fry 12 your hardware would be worse than that. 13 Question: Okay. Short of something 14 that actually corrupts the hardware, is there 15 anything that would be more troubling to an end 16 user, in your opinion, than the loss of data? 17 Answer: It depends on the extent of 18 the loss of data. Data loss is a severe 19 problem, I'll grant you that. I don't want to 20 engage in a debate over how severe it is. It's 21 a severe problem, yes. 22 Question: Okay. When MS-DOS 6.0 23 shipped, users were experiencing data loss; 24 correct? 25 Answer: No. 13257 1 Question: They were not? 2 Answer: That's correct. 3 Question: No users experienced data 4 loss? 5 Answer: There were reports of it, 6 reports that we were not able to confirm. 7 Question: Okay. So if somebody 8 reported to you that there was instances of 9 data loss after MS-DOS 6.0 shipped, that was in 10 error? 11 Answer: No. When people called us, 12 you know, if they heard, you know, they claimed 13 there was data loss, it was something we took 14 extremely seriously. We had people 15 investigating it. We weren't able to determine 16 the cause of their data loss and whether MS-DOS 17 6 was the source of that loss or not, of that 18 alleged loss even. 19 Question: Okay. And so in your 20 opinion -- well, would it also be your 21 testimony, then, that when Microsoft shipped 22 MS-DOS 6.2, that was not to correct bugs that 23 were in MS-DOS 6.0? 24 Answer: The purpose was to correct 25 the perception that there were problems with 13258 1 MS-DOS 6. 2 Question: What does that mean? 3 Did you just slap a new label on it 4 and say we've fixed the problems and so don't 5 worry about it anymore, and, in fact, had done 6 nothing to it? 7 Answer: We didn't do much. 8 Question: But you told people that 9 you did? 10 Answer: We told people to test it. 11 We made -- we added a couple utilities. We 12 were never able to find the source of what 13 people claimed were data loss errors. We've 14 renamed the version, and lo and behold, the 15 people who said there were problems with MS-DOS 16 6.0 now said those problems didn't exist with 17 MS-DOS 6.2. It was quite amazing to watch. 18 Question: So there were no reports of 19 data loss problems with MS-DOS 6.2; that's your 20 testimony? 21 Answer: Not that I can recall. 22 Question: Okay. 23 Answer: I know that the magazine that 24 complained the most about problems with MS-DOS 25 6.0 said there were no problems with MS-DOS 13259 1 6.2. 2 Question: And that would be 3 Infoworld? 4 Answer: That magazine would be 5 Infoworld, yes. 6 Question: Let me hand you what's 7 marked as Deposition Exhibit 1704. 8 Answer: Okay. 9 Question: Mr. Chase was a direct 10 report to you at this point in time, correct, 11 May 1993? 12 Answer: Yes, he was. 13 Question: And he was product manager 14 for MS-DOS 6; correct? 15 Answer: That was among his 16 responsibilities, yes. 17 Question: Okay, yeah. 18 He reports -- now, this e-mail, again, 19 is a thread, and the first on the thread is 20 from Mr. Chase to you, Mr. Maples, and 21 Mr. Maritz, and he's cc'ing Bill Gates, Steve 22 Ballmer and some others. 23 This first sentence says, we have 24 completed the thorough analysis of the PSS 25 data. 13260 1 What is PSS? 2 Answer: PSS, product support. 3 Something or other, I don't know. Tech 4 support, product support. 5 Question: Would -- I mean, what is 6 the PSS division of Microsoft? 7 Answer: It was a division, product 8 support. 9 Question: Which means what? 10 Answer: Technical support. 11 Question: For end users to call in or 12 -- 13 Answer: Among other things, yes. 14 Question: Who else? 15 Answer: Corporations, OEMs, partners. 16 Question: Were calling in for 17 technical support on Microsoft products; 18 correct? 19 Answer: They may call in. They may 20 send e-mail. They may have other relationships 21 with other company. 22 Question: The third paragraph of 23 Mr. Chase's e-mail says, the current number of 24 US MS-DOS 6 upgrade customers losing data (full 25 or partial) is about 3 in 1,000. 13261 1 Do you recall whether that's accurate 2 or not? 3 Answer: No. 4 Question: Do you have a reason to 5 dispute Mr. Chase in his estimation of how much 6 full or partial data loss was occurring at this 7 point in time following the shipment of the 8 MS-DOS 6 upgrade? 9 Answer: My impression is I would 10 characterize that as people who are claiming to 11 have lost data. 12 Question: Mr. Chase goes on in that 13 paragraph to say, this number includes 14 customers who lose data because of crosslinked 15 files, a number that may be no different than 16 MS-DOS 5, but is something double space users 17 are more aware of because we automatically 18 report it when we detect it. 19 With any other version of MS-DOS, you 20 essentially have to run with -- is that check 21 disk? 22 Answer: I'm sorry. I'm not following 23 what you're saying. Are you reading something 24 from this? 25 Question: Yeah. I didn't mean to 13262 1 bore you with it. Why don't we start over. 2 Answer: Which paragraph are you 3 reading? You didn't say which paragraph. 4 Question: Third paragraph. 5 Answer: Okay. 6 Question: Third sentence. 7 This number includes customers who use 8 data because of crosslinked files, and then he 9 goes on. So let's just focus on that. 10 Answer: Okay. 11 Question: Are you saying that -- is 12 Mr. Chase there reporting that customers have 13 actually lost data or not? 14 Answer: I think Mr. Chase is 15 reporting people who may have already lost data 16 and weren't aware of it. 17 Question: The next paragraph he says, 18 we have a meeting set up with you to review the 19 data and recommendations. 20 About 40 to 60 percent of the problems 21 are either things we will never be able to fix 22 (for example, we can't do anything about the 23 person whose hard disk is about to go bad and 24 they run defrag and double space and it is the 25 catalyst that sends the disk to hard drive 13263 1 heavy) or problems that defy explanation even 2 given our considerable research. 3 You would agree that that is at least 4 acknowledging that problems do exist, wouldn't 5 you? 6 Mr. Silverberg, is Mr. Chase talking 7 about actual problems or mere perception? 8 Answer: You would have to ask 9 Mr. Chase. 10 Question: Because you have no -- did 11 he make it a habit of sending things to you 12 that made no sense or didn't have anything to 13 do with the products he was in charge of? 14 Answer: Mr. Chase could be referring 15 to problems with the hard disk problems that 16 already existed, preexisting conditions on that 17 person's personal computer. 18 He could be referring to a number of 19 things and was referring to those things, as 20 the previous paragraph describes. Those 21 problems already existed and MS-DOS 6 just 22 reported it, and then people said MS-DOS 6 23 caused it. I would call that a perception 24 problem. 25 Question: Do you recall anything 13264 1 about the decision to do an update to MS-DOS 6 2 after it shipped? 3 Answer: Yes. I recall that we 4 decided to ship some utilities which basically 5 told the customer you already have a 6 preexisting condition problem, and so we did 7 that. 8 And we looked at the code over and 9 over and over again and didn't find any 10 problems in the double space code that would 11 cause data loss errors. 12 Question: So it wasn't a problem with 13 a Microsoft product, it was a problem with -- 14 it was the customer's problem, not Microsoft's 15 problem; is that what you're saying? 16 Answer: The customer may have had a 17 and very often did have a preexisting condition 18 where their computer already had desktop loss 19 errors, already had crosslinked files. 20 And then once you get the situation 21 where people are starting to blame MS-DOS 6, 22 you know, we saw people just blaming MS-DOS 6 23 for eczema. It became a negative perception 24 problem and we had to respond to it. 25 I mean, we were very concerned about 13265 1 actual data loss customers were having and we 2 wanted to do everything we could to help warn 3 them to let them know you may already have a 4 problem before you even touch MS-DOS 6. 5 And that's the primary effort that was 6 involved in MS-DOS 6, or the utilities, to warn 7 them they had crosslinked files already. 8 Question: Did Microsoft ship an 9 MS-DOS 6.0a? 10 Answer: No, it did not. 11 Question: Mr. Chase says in the last 12 paragraph on the first page of Exhibit 1704, 13 with this data, I now think we should do an 14 MS-DOS 6.0a. The objective is to reduce data 15 loss problems and help customers. 16 So an MS-DOS 6.0a was not shipped? 17 Answer: That is correct. 18 Question: And, instead, Microsoft 19 shipped MS-DOS 6.2? 20 Answer: Microsoft shipped MS-DOS 6.2. 21 Question: And there continued to be 22 reports of data loss problems with MS-DOS 6.2; 23 correct? 24 Answer: Not that I recall. 25 I recall Infoworld said the product is 13266 1 fine. It's all fixed. 2 Question: Let me hand you what's been 3 marked as Exhibit 1705. 4 Answer: Okay. 5 Question: Okay. Do you recall this 6 e-mail? 7 Answer: No, I do not. 8 Question: Again, it's a thread. The 9 top of it indicates that Brad Chase is 10 forwarding something to you and Mr. Maritz; 11 correct? 12 Answer: Yes. 13 Question: Subject: FW. That stands 14 for forward; right? 15 Answer: FW stands for forward, right. 16 Question: Confirmed data loss 17 problems in MS-DOS 6.0/6.2. 18 Did I read that correctly? 19 Answer: Yes, you did. 20 Question: Okay. And what Brad Chase 21 is forwarding to you is the e-mail below which 22 was from Eric Straub to Brad Chase; correct? 23 Answer: Apparently, yes. 24 Question: Okay. Who is Eric Straub? 25 Answer: Eric Straub was a product 13267 1 manager on MS-DOS -- no, a program manager, 2 excuse me, strike that. Program manager. 3 Question: What's the difference 4 between program manager and product manager? 5 Answer: Well, it tends to be program 6 managers are involved in the product 7 definition, product production and development 8 of the software; whereas, product managers tend 9 to be more focused on the marketing. But not a 10 hard and fast distinction. 11 Question: Okay. His first sentence 12 says, we now have three confirmed data loss 13 problems in MS-DOS 6.2, and he lists them. 14 I take it you have no recall of these 15 data loss problems being reported to you? 16 Answer: That's correct. 17 Question: Did 6.2, MS-DOS 6.2a ever 18 get shipped? 19 Answer: I don't know. 20 Question: What was the last version 21 of MS-DOS to ship, if you recall? 22 Answer: Don't know, don't know. 23 Question: I note that he says, Eric 24 Straub, of the three confirmed data loss 25 problems he's reporting, he states, Number 2 is 13268 1 kernel bug, which has been in since MS-DOS 5, 2 but was never encountered until we did 3 automount. 4 Do you have any idea what that means? 5 Answer: I don't know what automount 6 is. 7 Question: Okay. Are you familiar 8 with the term vaporware, Mr. Silverberg? 9 Answer: With the term vaporware. 10 I've heard the term used. 11 Question: Do you have an 12 understanding what it means? 13 Answer: Why don't you tell me what 14 you think it means and I'll tell you whether I 15 agree with that definition, because it can mean 16 many different things in different contexts. 17 Question: Okay. I'd like to get all 18 the different meanings that it can have as far 19 as you're concerned. 20 What different things can vaporware 21 mean? 22 Answer: Again, it can mean many 23 different things. Sometimes a company may 24 announce a product that it has never -- it 25 hasn't developed yet. Sometimes people use it 13269 1 to refer to products which are in development, 2 actually may even be in the beta test, but 3 somebody calls it vaporware because it's not 4 commercially available yet. 5 At times it may be referred to as a 6 presentation of future directions. It can mean 7 many different things depending on the context 8 and the intentions of the person using the 9 term. 10 Question: Is there a difference 11 between the term vaporware and product 12 preannouncement, in your opinion? 13 Answer: Yes. 14 Question: Okay. What is a product 15 preannouncement? 16 Answer: It could also mean many 17 things. 18 Question: Okay. 19 Answer: You may be informing 20 customers or partners of products before 21 they're actually shipped, give you a sense of 22 future direction, get feedback on product 23 ideas. 24 Question: Does Microsoft ever make 25 preannouncements to freeze OEMs and ISVs in 13270 1 their product plans? 2 Answer: No. 3 Question: Were you aware of Microsoft 4 ever engaging in preannouncement of MS-DOS 5 products to stall market acceptance of DR-DOS 6 products? 7 Answer: To stall market adoptance of 8 DR-DOS products? Not put that way. 9 Question: When you started at 10 Microsoft in June of 1990, what was the status 11 of development of MS-DOS 5.0? 12 Answer: When I started it had 13 recently gone to beta, first beta. 14 Question: Had MS-DOS 5.0 been 15 announced at that point? 16 Answer: Certainly the act of going to 17 beta announces a product. 18 Question: Had Microsoft indicated 19 when that product would be available to end 20 users? 21 Answer: I don't recall. 22 Question: Had Microsoft stated, to 23 the best of your recollection, that MS-DOS 5.0 24 would be available by the end of the year, the 25 year being 1990? 13271 1 Answer: My recollection is that our 2 expectation was that it would be available 3 then. 4 When I started, that's when the deputy 5 told me they thought the product would ship by. 6 Question: And had Microsoft -- 7 persons at Microsoft been communicating that to 8 the media, those expectations? 9 Mr. Holley: At what time? 10 Question: June 1990. 11 Answer: I don't recall. 12 Question: Okay. The first beta that 13 had gone out, did it have all of the features 14 included that were in the final version of 15 MS-DOS 5.0? 16 Answer: No, it did not. 17 Question: Do you recall what features 18 were added? 19 Answer: Quite a number of features 20 were added. I couldn't recall all of them. 21 Question: Can you recall any of them? 22 Answer: Yes. 23 Question: Okay. Will you please do 24 so? 25 Answer: We added undelete, we added 13272 1 the inclusion of network redirectors. And we 2 substantially improved the memory management. 3 Those are the ones I recall off the top of my 4 head. 5 Question: Do you know when DR-DOS 5.0 6 was released? 7 Answer: No. Sometime in 1990, I 8 would guess. 9 Question: Okay. Were you aware of 10 the features that were included in DR-DOS 5.0? 11 Answer: June 1990. I don't know what 12 awareness I had of particular features. I was 13 probably aware of the existence of the product. 14 I don't know if I knew what the specific 15 features of DR-DOS was at that time. 16 Question: Features were added -- 17 Answer: I don't know if DR-DOS was 18 shipping then, the new DR-DOS 5, I don't know 19 what the current version at that time was. I 20 don't know. 21 Question: Features were added to 22 MS-DOS 5.0 after the first beta specifically in 23 response to the features that were shipping in 24 DR-DOS 5.0; correct? 25 Answer: Features were added to MS-DOS 13273 1 5 to make it a more attractive product, 2 including responding to some features that may 3 have been in DR-DOS, but not restricted to 4 that. 5 Question: Some of the features that 6 Microsoft added after the first beta of MS-DOS 7 5.0 added features that were in the shipping 8 version of DR-DOS 5.0; correct? 9 Answer: That were similar to features 10 that DR-DOS may have had. 11 Question: Okay. 12 Answer: I won't say the same. I'll 13 say maybe similar. 14 Question: Were those features added 15 to compete with DR-DOS 5.0? 16 Answer: They were added to make 17 MS-DOS 5 a more attractive product, sell more 18 product. 19 Question: By more attractive, do you 20 mean more attractive to OEMs, to end users? 21 Answer: Including end users, OEMs, 22 potential users. 23 Question: Did adding features impact 24 the anticipated delivery date of MS-DOS 5.0? 25 Answer: It was one factor that did, 13274 1 yes. 2 Question: I take it by that answer 3 the delivery date for MS-DOS 5.0 did slip? 4 Answer: Yes, it did. 5 Question: Was that communicated to 6 OEMs directly, the fact that it was slipping? 7 Answer: I don't recall. 8 Question: Do you recall disclosures 9 being made to the media so that end users would 10 know that the product was slipping? 11 Answer: I don't recall. 12 Question: Okay. Do you recall there 13 being an accusatory article in PC Week that 14 Microsoft had preannounced MS-DOS 5.0 to 15 forestall sales and market acceptance of DR-DOS 16 5.0? 17 Answer: I don't recall the accusation 18 is false, but I don't recall the article. 19 Question: I'm sorry? 20 Answer: That accusation you just made 21 is false, but I don't recall the article. 22 Question: I'll hand you what has 23 previously been marked as Deposition Exhibit 24 907. This was marked and used in prior 25 depositions. 13275 1 This is a PC Week article from October 2 22, 1990, entitled Microsoft outlines DOS 5.0 3 to ward off DR-DOS, and it's by Paul Sherer. 4 Please take some time to review it. 5 Answer: Okay. 6 Question: Do you recall this article 7 now? 8 Answer: No. 9 Question: Do you recall writing a 10 letter to the editor about this article? 11 Answer: No. 12 Question: Okay. The second to the 13 last paragraph states, Microsoft vice president 14 Brad Silverberg denied that the company was 15 using openness as a ploy against DR-DOS. 16 Do you remember making comments like 17 that or being interviewed to that effect? 18 Answer: No. 19 Question: Okay. The fourth paragraph 20 states, Microsoft, in a shift in its policy of 21 not commenting on unreleased products -- has 22 been unusually cooperative in confirming 23 details about MS-DOS 5.0. 24 Now, by October of 1990, you had been 25 at Microsoft for approximately five months; 13276 1 correct? 2 Answer: Well, let's count it out. 3 July, August, September, October. Well, less 4 than four months. 5 Question: Okay, I guess it depends on 6 when you started in June. 7 Okay, four months. 8 Did you know -- 9 Answer: Less than four, but June 10 26th. I think I testified to that numerous 11 times. 12 Question: Good recall. 13 Do you have a good memory? 14 Answer: Sometimes, sometimes not. 15 Question: Okay. It depends on what? 16 Answer: I remember the day I started 17 Microsoft. It was either the 24th or 26th. 18 Question: Okay. 19 Answer: I remember my birthday. I 20 remember my anniversary. 21 Question: Prior to -- did you have an 22 understanding when you started at Microsoft 23 what the policy of Microsoft was about 24 commenting on unreleased products? 25 Answer: No. 13277 1 Question: Was that something that was 2 explained to you when you started? 3 Answer: No. 4 Question: Never had any discussions 5 with anybody about that? 6 Answer: Not that I recall. 7 Question: Not with anybody in PR? 8 Answer: Not that I recall. 9 Question: Okay. Is it just up to you 10 the extent to which you wanted to disclose 11 features and anticipated dates for shipping 12 unreleased products? 13 Answer: It wasn't just up to me, no. 14 Question: What constrains you in that 15 regard? 16 Answer: Other people may have other 17 views. 18 When you go to beta with a product, 19 it's hard to deny ultimately that the product 20 exists. When the product is external outside 21 the company, it's rather difficult to deny its 22 existence. 23 Question: Are you aware of any 24 Microsoft officials telling any member of the 25 press before MS-DOS 5.0 went into beta one that 13278 1 MS-DOS 5.0 would be out by the end of 1990? 2 Answer: No, I don't recall that. 3 Question: I believe you testified 4 that you don't recall writing a letter to the 5 editor -- 6 Answer: That's correct. 7 Question: -- of PC Week in response 8 to this article? 9 Answer: That's correct. 10 Question: Okay. 11 Answer: I'll also say that it was -- 12 when I started, it was Microsoft's expectation 13 that the product would ship by the end of the 14 year. I'll repeat, I've mentioned that 15 earlier. Perhaps worth repeating. 16 Question: Let me hand you what's been 17 marked as Deposition Exhibit 1706. 18 Answer: Okay. 19 Question: Do you recall this letter 20 now having read it? 21 Answer: No. 22 Question: Do you see any false 23 statements in this letter? 24 Answer: Any false statements? No. 25 Question: Do you dispute that you 13279 1 wrote and submitted this letter to PC Week? 2 Answer: I don't recall writing it, 3 but it's possible. 4 Question: Do you agree that this is a 5 letter written in response to the October 22 6 article that we were just looking at? 7 Answer: I don't recall writing it, so 8 I can't answer that question definitively. 9 Question: Okay. 10 Answer: I don't recall this article. 11 I don't recall this response, so it's hard to 12 answer that question. 13 Question: So are you saying that it's 14 possible PC Week published something saying it 15 was by you when, in fact, it wasn't by you? 16 Answer: No. I'm saying I don't 17 recall writing this letter. 18 Question: Okay. The first sentence 19 of the second paragraph says, the feature 20 enhancements of MS-DOS version 5.0 were decided 21 and development was begun long before we heard 22 about DR-DOS 5.0. 23 Is that statement true or false? 24 Answer: True. 25 Question: The feature enhancements of 13280 1 MS-DOS version 5.0 were decided before 2 Microsoft heard about DR-DOS 5.0? 3 Answer: As far as I'm aware. Well, I 4 mean, I did add some features when I came to 5 the company. I don't know what was in DR-DOS 6 at that time, that's true. 7 Question: Well, it's your testimony 8 that all of the feature enhancements of MS-DOS 9 version 5.0 were decided -- 10 Answer: Not all of them. Not all of 11 them. 12 Question: Okay. So that statement is 13 not correct, is it? 14 Answer: It doesn't say all of them, 15 does it? 16 Question: Would it have to say that 17 for people to believe that that's what the 18 letter is communicating, it would have to say 19 all feature enhancements? 20 Answer: That's your interpretation, 21 not mine. 22 Question: Okay. I don't know if 23 we've been clear on this. 24 Do you -- did you agree or disagree 25 that features were added to MS-DOS version 5.0 13281 1 in response to the feature set in DR-DOS 5.0? 2 And I'm confused now because it seems 3 to me that we're in conflict about that, so let 4 me get your definitive statement on that. 5 Answer: Okay. 6 Question: Were features added to 7 MS-DOS version 5.0 in response to the feature 8 set shipping in DR-DOS 5.0? 9 Answer: There were a number -- there 10 were features that were added to MS-DOS 5 after 11 I began at the company to make the product more 12 exciting and more appealing to customers. 13 Question: And did that include 14 responding to the feature set in DR-DOS 5.0? 15 Answer: Some of those features may 16 have been in DR-DOS 5. 17 Question: Let me hand you what's 18 previously been marked as Exhibit 1109. 19 And it is a lengthy document, so you 20 can glance through it, but just so that we know 21 what we're talking about -- 22 Answer: No, unless you're going to 23 give me time to read the entire document, then 24 I'm not going to respond to questions -- 25 Question: Well, actually -- 13282 1 Answer: -- taken out of context in 2 this lengthy document. 3 Question: What is this document, 4 Mr. Silverberg? 5 Answer: It's a document you just 6 handed me. 7 Question: Okay. It says that it's to 8 Bradc, Bradh, Bradsi, Johnen, and Phil. 9 Who are those persons? 10 Answer: Bradc is Brad Chase. Bradh 11 is Brad Hastings. Bradsi is myself, and Johnen 12 is John Ensline, and Philba is Phil Barrett. 13 Question: It's from Mike Dryfoos; 14 correct? 15 Answer: From Mike Dryfoos. 16 Question: It's dated September 18, 17 1991; correct? 18 Answer: That's what it says, yes. 19 Question: Okay. And what does the 20 first sentence say? 21 Answer: Attached is a copy of the DOS 22 5.0 postmortem report for your review. 23 Question: So what do you believe this 24 document to be having read that sentence? 25 Answer: A copy of the DOS 5 13283 1 postmortem report. 2 Question: Do you recall receiving a 3 DOS 5 postmortem report? 4 Answer: Vaguely. 5 Question: What is a postmortem report 6 in Microsoft? 7 Answer: In Microsoft? I don't think 8 there is a standard definition in Microsoft for 9 a postmortem report. 10 Question: Have you ever seen any 11 other postmortem reports? 12 Answer: Not of this form. 13 Question: Well, you haven't even 14 looked at this one. How do you know what this 15 form is? 16 Answer: I did glance through it 17 quickly. 18 Question: Based on that glance, you 19 now know you've never seen one in this form? 20 Answer: Not one this long. This is 21 what, 32 pages? 32 pages. 22 Question: So would this be an 23 unusually thorough postmortem report? 24 Answer: No. I did have an 25 opportunity to review it briefly with counsel 13284 1 yesterday. So I'm familiar with aspects of 2 this, and this was a fairly unique document. 3 Question: So you did -- so you 4 reviewed this document yesterday? 5 Answer: I said I reviewed it briefly. 6 Question: Okay. So are you -- I'm 7 surprised. I thought -- so you're not seeing 8 this document for the first time, are you? 9 Answer: No, I'm not. 10 Question: Let's look at page 10. 11 Answer: Like I said, unless you're 12 going to allow me time to read this document in 13 detail, I'm not going to answer questions out 14 of context unless I'm instructed by counsel. 15 Mr. Eskridge: Mr. Holley? 16 Mr. Holley: Why don't you let him ask 17 his question. 18 Answer: Page 10, okay. 19 Question: Prior to seeing this 20 document yesterday, did you have a recall of 21 having received it in, you know, course of 22 business at Microsoft? 23 Answer: Yes. 24 Question: You do recall having seen 25 this back in September of '91? 13285 1 Answer: No. You asked do I recall 2 having received it? 3 Question: Uh-huh. 4 Answer: I do recall having received 5 it. 6 Question: You just don't know exactly 7 when? 8 Answer: I don't recall when. 9 Question: The last sentence of the 10 first paragraph says -- well, I'll read the 11 whole first paragraph so the Jury knows what 12 we're talking about. 13 Attached is a copy of the DOS 5.0 14 postmortem report for your review. I consider 15 this to be in approximately its final form, but 16 as you were important participants in the DOS 17 5.0 development process, I want to give you an 18 opportunity to review and comment on this 19 before I release it generally. It has already 20 gone through a review by the participants in 21 the postmortem meeting and the feedback I 22 received has been incorporated. 23 Do you know who the participants in 24 the postmortem meeting were? 25 Answer: No. 13286 1 Question: What basis do you have to 2 state that this is simply the view of a 3 disgruntled employee? 4 Answer: That's my view of this 5 document. And conversations with Mr. Chase 6 about this document when it came out confirmed 7 that. 8 Question: It goes on to say, if you 9 have any comments or corrections, please let me 10 know by next Wednesday, 25 September, so that I 11 can incorporate them into the final version for 12 release next week. 13 Did you make any comments or 14 corrections that you recall? 15 Answer: Yeah. I told Mr. Dryfoos I 16 disagreed with what he had to say, but if he 17 wants to publish it, that's fine. 18 Question: Okay. Let's get to one of 19 the things I'm sure you disagreed with, so back 20 to page 10, please. 21 There's a heading that says changing 22 product -- changing schedule. The additions to 23 the DOS 5.0 feature set came from a variety of 24 sources and circumstances. 25 Why don't you go ahead and read this 13287 1 section of the report, okay? 2 Answer: How far? 3 Question: This heading, changing 4 product -- changing schedule. 5 (Whereupon, playing of the video 6 adjourned.) 7 MS. CONLIN: Your Honor, may I request 8 again that we be -- that we kind of 9 fast-forward through Mr. Silverberg's readings? 10 THE COURT: How long is it? 11 MS. CONLIN: Some of them are quite 12 lengthy, Your Honor. 13 We can see on the tape when he begins 14 to speak again, and it just seems as though 15 this is not a good use of time. 16 MS. NELLES: Your Honor, could we 17 approach? 18 THE COURT: Yes. 19 (The following record was made out of 20 the presence of the jury at 10:45 a.m.) 21 THE COURT: Ms. Conlin? 22 MS. CONLIN: Your Honor, the jury 23 specifically requested that we do this, that we 24 fast forward. Do you recall that? It was some 25 time ago. 13288 1 THE COURT: I do. 2 MS. CONLIN: Mr. Silverberg is 3 probably the one in which there is the most 4 stopping to read and the most extensive 5 reading, at least of the ones that I've 6 personally reviewed. And I don't see the 7 evidentiary value of watching him read these 8 documents. It's just an irritant, I think, to 9 the jury. 10 And, Your Honor, Microsoft is in a 11 different position than we are. They can get 12 their witnesses here. We're stuck with what 13 we've got for the most part. And as a result 14 of that, when we are not permitted to at least 15 ease the pain for the jury, then that inures to 16 our detriment and Microsoft will not suffer the 17 same detriment because they do not have to use 18 depositions. They can make their witnesses 19 come. They have power over their witnesses. 20 We do not. 21 THE COURT: How long does he take in 22 looking at it? 23 MS. CONLIN: I bet you, Your Honor, in 24 this deposition at least an hour is expended by 25 Mr. Silverberg in reviewing documents, at least 13289 1 an hour out of a total of about five hours is 2 used for that purpose. I'm only guessing. I 3 haven't tried to measure it, but it's quite a 4 lengthy time that he spends with his head down 5 leafing through documents. 6 MS. NELLES: Your Honor, several 7 things. 8 First, I resent Ms. Conlin 9 characterizing, without having any knowledge 10 whatsoever, what our case is going to be. We, 11 too, have much testimony that is going to come 12 in by deposition. We do not have control over 13 our witnesses. We can't force people to come 14 testify. 15 I know Ms. Conlin continually likes to 16 characterize Microsoft as an evil empire. Many 17 people who are involved in the testimony here 18 are long ex-employees or never were employees, 19 but that's really neither here nor there for 20 purposes of what we're talking about. 21 There are some long pauses in 22 Mr. Silverberg's deposition. It's certainly 23 nowhere close to an hour's worth, but there are 24 certainly long pauses. 25 However, the issue I'm having is that 13290 1 we have addressed this, one, in court 2 conference; two, there is a standing order; 3 three, there was a motion for reconsideration 4 made by the plaintiffs that was ruled on not in 5 their favor. 6 And what Ms. Conlin did is stood up 7 and told this jury that it is somehow Microsoft 8 that is making them sit through these long 9 pauses because she -- the characterization or 10 the concern that she has is to somehow let this 11 jury know that this is not her fault. 12 We will have witnesses that have long 13 pauses. She has witnesses that have long 14 pauses. 15 And what the Court said last time is 16 if there were long pauses that plaintiffs felt 17 could come out and didn't go to the credibility 18 of the witness, to raise them with Microsoft 19 ahead of time and work them out. 20 Nothing was raised with Microsoft 21 ahead of time about these pauses, to my 22 knowledge. However, I think -- I mean, it was 23 incredibly prejudicial for her to stand up 24 there and make this speech in front of the jury 25 and not come to Your Honor ahead of time or ask 13291 1 for some kind of a sidebar to respond to a 2 juror concern and tell them, "Look, I'm working 3 here in your favor, and it's these people who 4 are trying to stop you." 5 Evidence comes in. Sometimes it's not 6 good for us. Sometimes it's not good for 7 plaintiffs. There are procedures. Sometimes 8 they're not good for us, and sometimes they're 9 not good for plaintiffs. But it is for the 10 Court to decide how evidence is fairly 11 presented. And I am -- I don't know what to do 12 with what Ms. Conlin just did. I think it was 13 incredibly inappropriate. I really don't know 14 what to do about it. 15 THE COURT: Didn't I tell the jury 16 that there would be -- 17 MS. NELLES: Pauses. 18 THE COURT: Did I tell them that? 19 MS. NELLES: Yes, you did. You 20 addressed it on the record. 21 MR. GREEN: This is beyond a pale for 22 Ms. Conlin to get up and do this and try to 23 shift the blame to us for decisions that she's 24 made in her case that you have already ruled 25 upon. 13292 1 MS. NELLES: And spoken to the jury 2 about. 3 MR. GREEN: It has got to be corrected 4 and got to be corrected now. It's really 5 prejudicial, and it never should have been 6 done. 7 MS. NELLES: I think we need to take a 8 break and see if there is a way to cure this. 9 I guess it's obvious I'm a little upset. I'm 10 not going to say another word. 11 THE COURT: We will take a break at 12 this time. It's almost five 'til and we will 13 take the matter up after noon. 14 MS. CONLIN: Thank you, Your Honor. 15 (The following record was made in the 16 presence of the jury at 10:51 a.m.) 17 THE COURT: Since it's close to our 18 break time, we'll take our break now. 19 Remember the admonition previously 20 given. Leave your notebooks here. 21 We'll see you at noon. 22 Thank you. 23 (A recess was taken from 10:51 a.m. 24 to 12:03 p.m.) 25 (The following record was made out of 13293 1 the presence of the jury.) 2 THE COURT: All right. Do you want to 3 make a record? 4 MS. NELLES: Yes, Your Honor. 5 MS. CONLIN: Your Honor? 6 THE COURT: Go ahead. 7 MS. CONLIN: If I may, may I defend 8 myself, Your Honor? 9 THE COURT: You may. 10 MS. CONLIN: My comment was triggered 11 by audible sighs coming from the Jury box. 12 They started happening from about the 13 third exhibit in and became a little difficult 14 to ignore, and that is what triggered my 15 comment. 16 I understand Microsoft's objections, 17 however, and I did not mean to make any 18 improper suggestion. 19 I may have gotten lost. The last time 20 this came up it was in the context of a juror's 21 request, and I'm uncertain, Your Honor, whether 22 that was ever dealt with. And I would make a 23 couple of suggestions. 24 In the event that the Court decides we 25 can fast-forward, then perhaps the Court should 13294 1 say something that mitigates any damage that I 2 inflicted. And I'm not sure what that should 3 be. 4 And if the Court decides not to permit 5 fast-forwarding, then I would suggest that the 6 Court say something like we know this is 7 difficult, but this is the result of the 8 Court's order. It's not the fault of either 9 party, or something that, again, Your Honor, I 10 seek to mitigate any damage that I may have 11 inflicted unintentionally. 12 It was the juror's response that 13 triggered my remark. 14 THE COURT: Okay. 15 Ms. Nelles? 16 MS. NELLES: Thank you, Your Honor. 17 I'm sorry for jumping in on 18 Ms. Conlin. I thought this was going to be my 19 motion for instruction. 20 I think we've at least agreed that 21 probably one is necessary. 22 I will try to be brief, but I just 23 want the record to be clear that this issue was 24 first addressed on October 26th, during one of 25 our court conferences. 13295 1 And Your Honor issued a ruling at that 2 time. And Your Honor said at that time the 3 Court was asked to decide the issue of whether 4 or not tape deposition preserved for trial can 5 be edited to eliminate long pauses. 6 The Plaintiffs wished such editing. 7 The Defendant objects to any editing as the 8 tape testimony should be viewed in its entirety 9 with any pauses the same as if it was given 10 live in open court. 11 The Defendant argues that the Jury 12 should be allowed to view not only the answers 13 of the witnesses taped but how they answer, 14 their demeanor and manner. The Court agrees 15 with the Defendant. 16 Therefore, the Court finds that the 17 taped depositions or agreed to taped testimony 18 of any witness preserved for trial presentation 19 shall not be edited. 20 And that was the rule of this Court. 21 And it stood, I believe, until January 16 when 22 we received a question from Juror Number 6. 23 And Juror Number 6 asked, in order to 24 speed along the process of this trial, is it at 25 all possible to forward through the dead air 13296 1 portions of the depos; i.e., while they are 2 reading documents. 3 And there was much back and forth that 4 same day regarding that. There was a long 5 argument by Plaintiffs -- Mr. Cashman argued 6 for Plaintiffs, Mr. Tulchin argued for 7 Microsoft. 8 And this is on January 16 at trial 9 transcript starting at page 8568, and it goes 10 through page 8570. 11 And, ultimately, what the Court ruled 12 was -- Mr. Cashman's last line was: Ultimately 13 so we request we be permitted to edit out those 14 dead spaces. 15 The Court: And they resist; right? 16 Mr. Tulchin: Correct, Your Honor. 17 The Court: All right. I'm going to 18 stay with my ruling. 19 So that was on January 16. 20 On January 17, Plaintiffs came back 21 yet again -- this was Mr. Cashman one more time 22 readdressing this -- and ultimately asking if 23 they were not going to be allowed to edit out 24 pauses in the deposition testimony that the 25 Court give some kind of a statement to the 13297 1 Jury. 2 I think he asked for a statement along 3 the lines of letting the Jury know that somehow 4 this was Microsoft's fault. Mr. Tulchin 5 resisted a question along those lines. 6 I think ultimately they all agreed 7 that some statement was appropriate and the 8 Court ruled, I'll mention something in passing 9 that the long pauses are part of the deposition 10 record. 11 This was on January 17, so less than a 12 month ago. 13 THE COURT: I stated that to the Jury? 14 MS. NELLES: You stated that at the 15 close of argument, and I'm looking at January 16 17, transcript page 8655 through 8656. That 17 was back when we were only in four digits of 18 transcript pages. 19 And then that same day -- and it's 20 reflected on transcript page 8661 -- this is 21 what the Court said to the Jury. 22 There was a question about the long 23 pauses in the depo. That's part of my doing. 24 I wanted the record to come in just as it is. 25 So I apologize for that. 13298 1 Now, this morning -- and it was not on 2 the record at Ms. Conlin's request -- and I'm 3 sorry it wasn't on the record -- Ms. Conlin 4 asked yet again if this issue had been 5 resolved. 6 This was right as the Jury was coming 7 in. And the Court told Ms. Conlin this morning 8 that, yes, the issue was resolved and pauses 9 were not to be edited. 10 Now, I understand that the Jury -- 11 it's hard for the Jury to sit through pauses. 12 I've made the arguments before as to why pauses 13 should not be edited out. I'm not going to go 14 through them again. 15 I think the Court's ruling stands. 16 The Court has stood on its ruling three or four 17 separate times now. 18 But I do want to say that the issue of 19 depositions is not simply one for Plaintiffs. 20 Microsoft will have plenty of depositions that 21 it needs to play. We're talking about events 22 at the moment, I think, from 1993. 23 Not everybody is still available. 24 And, of course, the Court ordered that the -- 25 for example, our affirmative designations from 13299 1 Mr. Silverberg are not something to be played 2 now, but something we are going to have to 3 present later. 4 And it is hard for the Jury, and it is 5 very tiring for the Jury to go through 6 videotape, but what Ms. Conlin did having asked 7 right before the Jury came in and having the 8 Court affirm that such pauses were not going to 9 be edited out, that this was a ruled upon 10 motion and not to be reconsidered at the time, 11 stood up in the middle of this deposition and 12 told the Jury, jurors, I want you to know this 13 is not Plaintiffs' fault. I know you don't 14 like it and I want you to know that I am 15 fighting for you. The Plaintiffs are the ones 16 fighting for you on this issue, implying that 17 somehow Microsoft should be blamed or held 18 accountable for their uncomfortableness with 19 these depositions. 20 Now, I think Plaintiffs agree, and I 21 appreciate that, that some kind of curative 22 instruction needs to be given. 23 And I will admit I was a little angry 24 when it happened at the time, and I wrote 25 something. Mr. Tulchin talked me a bit off the 13300 1 ledge, so I've got something much more neutral 2 now that I would like to propose that the Court 3 say to the Jury. 4 I apologize it's not typed. I did 5 write it out. I will read it so Ms. Conlin 6 will hear it and then I will hand it to the 7 Court. My handwriting is not terrible, you'll 8 be happy to know. 9 And this is what I suggest. 10 Before we broke for lunch, Plaintiffs' 11 counsel made a statement before you regarding 12 fast-forwarding through pauses taken by 13 witnesses during their videotaped deposition 14 testimony. This was inappropriate. 15 The Court had ruled before this trial 16 began that pauses in depositions shall not be 17 edited, and, as you may remember, I told you on 18 January 17 that pauses taken by a witness are 19 part of the record. 20 Such pauses may not, by order of this 21 Court, be altered by Plaintiffs or by Microsoft 22 during the presentation of evidence. 23 And I'll hand that up with your 24 permission, Your Honor. 25 THE COURT: Thank you. 13301 1 Anything else, Ms. Nelles? 2 MS. NELLES: I simply want to add that 3 before something like this happens again, I 4 think we had this conversation, similar 5 conversation two days ago regarding something 6 Mr. Cashman had done, Ms. Conlin is a wonderful 7 attorney and she knows better than to do that 8 in front of the jury. 9 Such, if there's an issue, it should 10 be brought up in front of the Court at a 11 sidebar and not in front of the jury. 12 Thank you. 13 THE COURT: Anything else? 14 MS. CONLIN: Yes, Your Honor. 15 I was unaware of the January 16th and 16 17th events. I confess, I've been unable to 17 keep up with all of the transcript. And had I 18 known that and that the Court had made an 19 instruction, I would have been more 20 comfortable, though -- as I said, it was the 21 jurors' response to which I was reacting. 22 I would -- I think I do agree that the 23 Court should reaffirm its instructions. I 24 would prefer that the Court not say that I 25 behaved inappropriately. Certainly I did not 13302 1 seek to do that. 2 What I sought to do was ask the Court 3 if in this one instance -- I have to say I just 4 do not see the evidentiary value of the jury 5 watching Mr. Silverberg with his head down 6 reading, but if that's the Court's ruling, then 7 certainly that's the Court's ruling. 8 And I do see the need for the Court to 9 mitigate anything that the Jury might think in 10 terms of what I said. I'm not arguing that 11 point, Your Honor. I'm just asking that the 12 Court not condemn me for doing that. 13 MS. NELLES: Your Honor, if I may very 14 briefly. 15 I don't think I have ever asked that 16 Plaintiffs' counsel be condemned in front of 17 the jury. I think many times there's been 18 issues, and I have said there was no prejudice. 19 This is a rare exception because there 20 was prejudice, and the jurors were left for a 21 full hour with the impression that Plaintiffs 22 are taking up a battle on their behalf. That's 23 what's inappropriate and that's what needs to 24 be cured. 25 And Ms. Conlin did know that as of the 13303 1 time the Jury came in this morning because she 2 asked before this jury came in whether this had 3 been decided upon. 4 THE COURT: Okay. Anything else? 5 MS. NELLES: No, Your Honor. Thank 6 you. 7 THE COURT: Ms. Conlin, anything else? 8 MS. CONLIN: Nothing further, Your 9 Honor. 10 THE COURT: Okay. I'm going to give 11 an appropriate instruction to the Jury about 12 why this is being done and that it's my fault 13 only and they are not to blame Plaintiffs or 14 the Defendant. 15 And I have ordered the deposition, 16 videotape depositions of both parties' 17 witnesses be played as is. 18 MS. NELLES: Okay. 19 THE COURT: Very well. 20 MS. NELLES: Thank you, Your Honor. 21 THE COURT: You're welcome. 22 You may get them, Ms. Carrie. 23 MS. NELLES: And will Your Honor do 24 that before we resume? 25 THE COURT: Yes, right now. 13304 1 (The following record was made in the 2 presence of the jury at 12:15 p.m.) 3 THE COURT: Everyone else may be 4 seated. 5 Once again, if it's too cold or too 6 hot, please let Carrie know. 7 Everyone may be seated. 8 Sorry for the delay. I had a matter I 9 had to take up. 10 Members of the jury, I apologize to 11 you for any long pauses in the videotaped 12 depositions. I know this was an issue before 13 back on January 17th, and I addressed you at 14 that time. 15 Please blame me and not the parties 16 for any long pauses or dead spaces in videotape 17 depositions. I have previously ordered that 18 the parties, both parties before this trial 19 ever began, that the entire designated portions 20 of videotaped depositions are to be played, so 21 it is my responsibility and my fault only, and 22 I apologize for it. And I ask your patience in 23 viewing the videotape depositions. 24 I know it's not fun sometimes with 25 those dead spaces, but that's the way I've 13305 1 ordered it. I just want to let you know, 2 again, who is to blame, and that's me. So I'm 3 the guilty party. 4 I throw myself on the mercy of the 5 jury. 6 You may continue with Mr. Brad 7 Silverberg. 8 (Whereupon, the following video was 9 played to the jury.) 10 Question: At the end of the first 11 paragraph there under changing product -- 12 changing schedule, Mr. Dryfoos writes, one of 13 the most important stimulants for adding 14 features was competitive pressure from DR-DOS 15 5.0, which we first learned of in the spring of 16 1990. 17 The DR-DOS feature set led us to add 18 UMB support, task swapping and undelete. 19 Do you agree or disagree with that 20 assertion? 21 Answer: Disagree. 22 Question: Did you tell him that? 23 Answer: Yes, I did. 24 Question: Did he write that only 25 because he was disgruntled? 13306 1 Answer: I have no idea why he wrote 2 it. It was my decision to add undelete and it 3 had nothing to do with DR-DOS. 4 Question: Was undelete in DR-DOS 5.0? 5 Answer: I don't recall. 6 Question: That statement that I just 7 read, what part of it do you disagree with? 8 All of it? 9 Answer: There's two sentences. 10 Question: Yeah, I'm referring to -- 11 one of the most important stimulants for adding 12 new features was competitive pressure from 13 DR-DOS 5.0. 14 Do you agree that it was a stimulant 15 for adding features? 16 Answer: It was a stimulant, yes. 17 Question: Was it an important 18 stimulant? 19 Answer: It's hard to rank it. 20 Question: Okay. Would it be one of 21 the most important stimulants for adding 22 features? 23 Answer: I'm not sure I would say 24 that. 25 Question: Okay. It then concludes, 13307 1 which we first learned of in the spring of 2 1990. 3 Do you know if that's correct or not? 4 Answer: I don't know. I was not in 5 the company then. 6 Question: Okay. So Microsoft may 7 have learned of it in the spring of 1990, you 8 just don't know one way or another? 9 Answer: I have no way to agree or 10 disagree with that subclause in that statement. 11 Question: He then states, the DR-DOS 12 feature set led us to add UMB support. 13 Did the DR-DOS feature set lead you to 14 add UMB support? 15 Answer: I don't know. 16 Question: What is UMB support? 17 Answer: I don't recall exactly. It 18 has something to do with supporting upper 19 memory blocks. 20 Question: Did the DR-DOS -- I'm 21 sorry? 22 Answer: No, I'm just exhaling. 23 Question: He then says that the 24 DR-DOS feature set led us to add UMB support, 25 task swapping. 13308 1 Did the DR-DOS feature set lead you to 2 add task swapping? 3 Answer: I don't believe so. I'm 4 pretty sure no. 5 Question: Was task swapping a feature 6 in DR-DOS 5.0? 7 Answer: My recollection is that it 8 was not. 9 Question: Okay. 10 Answer: And my recollection is that 11 undelete was not. 12 Question: Okay. Can you look over at 13 page 15. There's a section that's headed 14 inadequate specifications. Do you see that? 15 Answer: I see the heading, yes. 16 Question: Okay. Mr. Dryfoos states, 17 much of what ultimately went into the DOS 5.0 18 project was not included in the initial 19 specification, or indeed ever specked at all. 20 Do you agree or disagree with that? 21 Answer: I have no feeling what -- 22 don't know. 23 Question: Okay. The next heading 24 down says schedules. It says, late feature 25 additions contributed significantly to schedule 13309 1 problems, as noted above. 2 Do you have an opinion as to whether 3 late feature additions contributed to Microsoft 4 schedule problems with MS-DOS 5.0? 5 Answer: As I've earlier testified, 6 adding features was one of the factors, yes. 7 Question: Can we return to Exhibit 8 1706, which was this letter I marked to PC 9 Week. Okay? 10 Answer: Okay. 11 Question: The third paragraph says, 12 as for the timing of the leaks, it was not an 13 orchestrated Microsoft plan nor did the leaks 14 come from Microsoft. 15 Answer: Okay. 16 Question: Is that a true or false 17 statement? 18 Answer: I don't know what this is 19 referring to, what the leaks were. 20 Question: Can you go back to Exhibit 21 907 which is the actual article? 22 Answer: Okay. 23 Question: The first paragraph says, 24 although the release of Microsoft Corporation's 25 new MS-DOS 5.0 operating system is months away, 13310 1 product details are emerging in a steady 2 stream. 3 Now, I realize that doesn't have the 4 word leak, but -- 5 Answer: Okay. 6 Question: Do you suppose -- 7 Answer: What's the question? Just, 8 I'm on a soapbox. 9 Question: Would details emerging in a 10 steady stream be a leak, in your opinion? 11 Answer: Don't know. 12 Question: And you don't recall this 13 letter that you sent and PC Week published? 14 Answer: No, I don't. 15 Question: Okay. Well, let's assume, 16 let's just assume that the leaks that they're 17 talking about -- 18 Answer: Leaks that who are talking 19 about? They're talking about details. It 20 doesn't use the word leaks. 21 Question: Okay. I was going to say 22 that let's assume that the leaks that this 23 letter that was published over your signature 24 refers to the product details emerging in a 25 steady stream. Just so we know what we're 13311 1 talking about. 2 Okay? Is that okay with you? 3 Answer: So we know what we're talking 4 about. I mean, there's all kinds of 5 assumptions underlying that that we may not 6 agree with, so. 7 Question: Well, I take it that you 8 say you don't know -- 9 Answer: I don't recall, I testified. 10 Go ahead, I'll let you -- 11 Question: All right. You're saying 12 that you don't know what the leaks are 13 referring to, and I'm just trying -- 14 Answer: I don't recall authoring this 15 letter, so I can't tell you what something in 16 that letter might have meant. 17 Question: Did Microsoft engage in an 18 aggressive leak campaign with regard to MS-DOS 19 5.0? 20 Answer: An aggressive leak campaign, 21 no. 22 Question: Never heard that phrase 23 before? 24 Answer: I don't recall hearing that. 25 When a product is out in beta in the 13312 1 public's hands, word gets out. It's very 2 difficult to deny the existence of a product 3 that's in the public's hands. 4 Question: Let me hand you what's been 5 marked previously as Exhibit 25 to Mr. Gates' 6 deposition. 7 Have you ever seen this document 8 before? 9 Answer: Not that I recall. I don't 10 recall seeing this document. 11 Question: Did you look at this 12 document yesterday? 13 Answer: No, I did not. Not that I 14 recall, no. 15 Question: Can you turn to the page 16 that's marked at the bottom X 504358? The 17 heading on the page is competitive response to 18 DR-DOS 5.0. 19 Answer: Okay. 20 Question: The first paragraph says, 21 on the PR side, we have begun an aggressive 22 leak campaign for MS-DOS 5.0. 23 The goal is to build anticipation for 24 MS-DOS 5.0 and diffuse potential 25 excitement/momentum for the DR-DOS 5.0 13313 1 announcement. 2 At this point, we are telling the 3 press that a major new release for Microsoft is 4 coming this year, which will provide 5 significant memory relief and other important 6 features. This was picked up by the major 7 weeklies in the U.S. and was the page one story 8 in PC Week on 4/30 (see attached articles.) 9 Answer: Was there a question? 10 Question: There's about to be. 11 Answer: Okay. 12 Question: If that statement is true, 13 is this statement that I had previously read in 14 Exhibit 1706 then false where it says, as for 15 the timing of the leaks, it was not an 16 orchestrated Microsoft plan nor did the leaks 17 come from Microsoft? 18 Answer: As I said, I have not seen 19 this document. I have not read this document. 20 I don't know what leaks that's referring to. 21 If they had reports from beta testers that they 22 had received MS-DOS 5, those could be the 23 leaks. 24 Question: I'm asking -- okay. 25 Answer: So I don't know whether the 13314 1 leaks that that statement is referring to, what 2 it refers to, what leaks it may be referring 3 to. 4 When the product came from -- is out 5 in beta testers in that time frame, Microsoft 6 was not engaging in a leak campaign. 7 Question: This document was written 8 in May of 1990, assuming that the date is 9 correct. And that's prior to your advent at 10 Microsoft; right? 11 Answer: That's correct. 12 Question: It's also prior to MS-DOS 13 5.0 having shipped the beta; correct? 14 Answer: I don't know. It shipped 15 sometime in May or June. I don't know exactly 16 when it went to beta. 17 Question: This was written May 2nd, 18 so for it to have shipped already it would have 19 to have shipped on May 1 or May 2; right? 20 Answer: Yeah. If it hadn't shipped, 21 it was just about to. 22 Question: And, again, this paragraph 23 that I just read from Exhibit 25, if that's 24 correct, then in contradiction to the first 25 sentence of the last paragraph in Exhibit 1706, 13315 1 there was an orchestrated Microsoft plan and 2 leaks did come from Microsoft. 3 Answer: That's not true. I've said 4 that's not true, and, you know, that's not 5 true. 6 I don't know what those -- that 7 article was referring to, so you can't say 8 that. Those leaks could have come elsewhere. 9 Microsoft was not engaged in the time 10 that the article was written in an orchestrated 11 leak campaign, or whatever these words are. 12 Question: Aggressive leak campaign. 13 Answer: Whatever. I can only tell 14 you what was true at the time that article was 15 written, what I know to be true. 16 Question: I'm not -- well, you don't 17 even recall writing this letter. And I'm not 18 saying that you were intentionally lying when 19 you write that sentence, if, in fact, you even 20 wrote that sentence. I'm simply saying, if 21 this is true, what was written is false here in 22 Exhibit 1706. 23 Answer: Wrong. 24 Question: And you disagree with that? 25 Answer: And I disagree with that 13316 1 conclusion. 2 Question: Okay. Going back to 3 Exhibit 1706 -- 4 Answer: Which is it? 5 Question: The letter that you may or 6 may not have written, but which PC Week 7 apparently published over your signature, the 8 sentence being, as for the timing of the leaks, 9 it was not an orchestrated Microsoft plan, nor 10 did the leaks come from Microsoft. 11 Are you saying that that's only true 12 as of November 5, 1990, or are you -- I mean, 13 would that be your testimony about that 14 statement? 15 Answer: It's hard to testify because 16 I'm not sure what the leaks is referring to. I 17 can tell you that my recollection that the time 18 this -- you know, Microsoft in October of 1990 19 was not engaging in an orchestrated plan and 20 the leaks that apparently this article in 21 October are being written about did not come 22 from Microsoft. 23 Those are true statements. 24 Apparently, this is referring to another 25 article, this article here published on October 13317 1 22nd. And that's a true statement. This is 2 referring to leaks in October. They did not 3 come from Microsoft. 4 Question: Who is Paul Sherer? 5 Answer: Paul Sherer was a reporter 6 for PC Week. 7 Question: You know, if you go to -- 8 in this article the eighth paragraph, it begins 9 at the bottom of the second column. 10 Okay? 11 Answer: Okay. 12 Question: There's a quote from Mark 13 Chestnut, who is described as Microsoft's 14 MS-DOS 5.0 product manager in Redmond, 15 Washington, okay? 16 Answer: Okay. 17 Question: The quote attributed to 18 Mark Chestnut is, it's more of a service to 19 customers than stonewalling. 20 And the immediate prior paragraph 21 says, Microsoft officials said the company is 22 enacting the glassness policy because there is 23 no use pretending there is no MS-DOS 5.0 when 24 everyone knows there is. 25 Okay. Do you see that? 13318 1 Answer: I see that, yes. 2 Question: Isn't that reporting that 3 details are coming from Microsoft? 4 Answer: No, not at all. 5 Question: Okay. What is it 6 reporting? 7 Answer: It's Microsoft acknowledging 8 that MS-DOS 5 exists. It's quite plausible, in 9 fact, if I had to guess, somebody sent 10 Mr. Sherer a copy of MS-DOS 5 beta, and he says 11 -- calls you up and says, hey, I have it in my 12 hands, how can you say it doesn't exist? 13 Question: Okay. If you go down -- 14 Answer: That's stonewalling in saying 15 it doesn't exist, when he says, but some beta 16 tester sent it to me, how can you say it 17 doesn't exist? 18 Question: You have no idea? 19 Answer: I don't know. 20 Question: And you responded, if, in 21 fact, you wrote this letter, you were 22 responding to this article which specifically 23 cited information that may have surfaced in the 24 same week in June that DRI announced DR-DOS 25 5.0. 13319 1 Do you recall discussing with anyone 2 about what details and information were given 3 to the press prior to you coming to Microsoft? 4 Answer: Well, I got lost in the 5 speech what the question was. 6 Question: Sorry. 7 Do you agree that this letter is in 8 response to this article? 9 Answer: Apparently so. 10 Question: Okay. But you just don't 11 recall writing it? 12 Answer: I don't recall writing it. 13 Question: Did you ever ask anyone 14 about what information had been given to the 15 press about the development and schedule for 16 MS-DOS 5.0 prior to your arrival at Microsoft? 17 Answer: Did I ask anybody prior to my 18 arrival? What was -- I don't recall any. I 19 mean, I was aware that they had spoken to the 20 press right around the time that the first beta 21 was released. I don't recall specifically what 22 was said. 23 If the question is, was I aware that 24 some people had spoken to the press to tell 25 them that a beta was coming and the beta did 13320 1 come right around that time, the answer is yes. 2 Any specifics, I don't recall. 3 Question: Okay, Mr. Silverberg, just 4 before the lunch break, I believe I'd asked you 5 whether you were aware when DR-DOS 6 shipped 6 and you said that you were not, correct? 7 Answer: That's correct. 8 Question: I'm going to represent to 9 you that it was shipped in September of 1991, 10 okay? 11 Answer: Okay. 12 Question: And I believe we've also 13 established that MS-DOS 5.0 shipped in June of 14 1991? 15 Answer: You've asserted that. I said 16 I didn't -- 17 Question: You have no independent 18 recollection of that? 19 Answer: I don't recall exactly when 20 it shipped. 21 Question: Do you remember when you 22 first began discussing MS-DOS 6.0 plans with 23 OEMs? 24 Answer: No. 25 Question: You have no recall of that 13321 1 one way or the other? 2 Answer: No. 3 Question: Could it have been as early 4 as September 1991? 5 Answer: I don't -- I told you I don't 6 recall. 7 Question: Let me hand you what's been 8 marked as Deposition Exhibit 1707. 9 This appears to me to -- well, first 10 of all, can you identify the handwriting in the 11 upper right corner of the first page? 12 Answer: No, I cannot. 13 Question: Is that your handwriting? 14 Answer: No. 15 Question: It is not your handwriting? 16 Answer: No. 17 Question: Okay. 18 Answer: I don't believe so. 19 Question: Okay. Go ahead and take a 20 few minutes to glance through this and I'll ask 21 you some questions about it. 22 Answer: Okay. 23 Question: Do you recall these slides? 24 Answer: No, I do not. 25 Question: Do these appear to be 13322 1 PowerPoint slides like we had looked at 2 previously? 3 Answer: It's likely, but I don't know 4 for sure. 5 Question: Okay. The upper right 6 corner says 9/6/91 NCR. Do you know what or 7 who NCR is? 8 Answer: I don't know what this refers 9 to. NCR is an OEM. I don't know if that's 10 what this refers to. I don't know who wrote 11 that. 12 Question: Okay. Do you know what NCR 13 -- NCR, the OEM, do you know what the acronym 14 stands for? 15 Answer: National Cash Register. 16 Question: Okay. 17 Answer: I don't believe they exist 18 anymore. 19 Question: I don't think they do 20 either. 21 Do you recall making a presentation to 22 them in September of 1991? 23 Answer: No. 24 Question: Okay. Do you recall 25 preparing these slides? 13323 1 Answer: No. 2 Question: Is there a possibility that 3 you might have prepared these slides, you just 4 don't remember it? 5 Answer: I don't recall. It's 6 possible. It's possible somebody prepared them 7 for me and put my name on it. I don't recall. 8 Question: You don't recall ever using 9 these slides? 10 Answer: No, I do not. 11 Question: Okay. On the fourth page, 12 MS7006895, the top of it says, DOS. Coming 13 soon, one page back. And it's got some bullet 14 points, ROM executable DOS, advanced power 15 management, file transfer utility, solid state 16 memory card support, flash file system. 17 Do you know when those features 18 shipped in Microsoft DOS versions? 19 Answer: No, I do not. 20 Question: On the next page it says 21 MS-DOS 6, and there's some bullet points. 100 22 percent DOS 5 compatibility. Platform for 23 Windows, including Win32, exploit 386, 24 installable file system. 25 Are those features that actually 13324 1 shipped in MS-DOS 6? 2 Answer: One and 3 did, 2 and 4 did 3 not. 4 Question: Okay. The next page, 5 MS-DOS 6 at the head and the four bullet 6 points. Improved installation, configuration, 7 administration; improved network support; 8 unified approach to localization. EAJL; 9 enhanced support for mobile computing. 10 Do you know what the acronym EJAL 11 stands for? 12 Answer: Yes, I do. 13 Question: And what is it? 14 Answer: English as just another 15 language. 16 Question: And did those features ship 17 in MS-DOS 6? 18 Answer: Certainly one did. I don't 19 recall on the others. 20 Question: Okay. In September of 21 1991, did Microsoft -- was Microsoft specking 22 out a version of MS-DOS that approximated the 23 version of MS-DOS 6.0 that shipped in March of 24 1993? 25 Answer: I don't know. 13325 1 Question: You don't remember? 2 Answer: No. 3 Question: Okay. Did Microsoft ever 4 have plans underway for a version of MS-DOS 6.0 5 that later became redesignated MS-DOS 7.0? 6 Answer: I don't know. 7 Question: Okay. You just don't 8 remember? 9 Answer: No. 10 Question: Do you recall making a 11 presentation to OEMs and -- I mean, generally 12 to a group of OEMs in September of 1991? 13 Answer: I don't, no. 14 Question: Let me hand you what's been 15 previously marked as Exhibit 291, and I want to 16 ask you a question -- well, go ahead and take a 17 -- a clarifying question first, if I may, 18 before you take a lengthy look at it. 19 It says under the description part on 20 the first page at the very beginning, following 21 is an overview of the 1991 OEM briefing. 22 Do you know what that's referring to? 23 Answer: Yes. 24 Question: Okay. Can you tell me what 25 that's referring to? 13326 1 Answer: Microsoft would periodically 2 have briefings to OEMs of various product 3 strategies, ideas. 4 Question: Okay. Go ahead and take a 5 few minutes. It's a dense little document, but 6 go ahead and take a look at it to the extent 7 you want to. 8 I have just a couple questions. 9 Answer: Okay. 10 Question: Okay. Do you remember 11 giving a presentation at this 1991 OEM 12 briefing? 13 Answer: No, I do not. 14 Question: Okay. Do you remember how 15 many OEMs attended this briefing? 16 Answer: No. I don't recall the 17 briefing. 18 Question: Okay. Do you recall that 19 it took place at the Seattle Convention Center? 20 Answer: I don't recall the briefing, 21 even its existence, let alone where it 22 occurred. 23 Question: Okay. Do you know who -- 24 this says it's from Robho to a whole lot of 25 people. Do you know who Robho is? 13327 1 Is it Horowitz? 2 Answer: It's possible. 3 Question: Who is Rob Horowitz? 4 Answer: He's a guy who used to work 5 at Microsoft. I didn't know him. I knew who 6 he was. I didn't know him. I don't know if 7 that's who Robho is. 8 Question: Okay. At the bottom of the 9 first page and continuing over to the second, 10 for the briefing overview, it says that the 11 dates were September 16 and 17 and that the 12 location was the Seattle Convention Center. 13 Do you have any knowledge that that's 14 incorrect? 15 Answer: I told you I don't recall the 16 -- 17 Question: I'm not trying to be 18 argumentative. I'm just going to go through a 19 couple of things. And if you might remember 20 once I go to a specific thing and you can say 21 no, I remember that's not correct, or something 22 has jogged your memory. I'm not trying to be 23 -- 24 Answer: I don't recall the meeting. 25 Question: He writes, a considerable 13328 1 amount of new (as in previously undisclosed) 2 information was discussed at the briefing 3 including, and the third bullet point referring 4 to DOS 6 -- it's the one that's back a little 5 bit. 6 Answer: Okay. 7 Question: -- DOS 6 was discussed in 8 considerable depth. Features: Preemptive 9 multitasking, threads, better memory 10 management, networking services, protect mode 11 device driver model, et cetera. 12 Is it possible that all that 13 information was disclosed to OEMs at this 14 briefing? 15 Answer: Like I say, I wasn't at the 16 meeting. I don't recall this document -- or I 17 don't recall the meeting. I'm not going to say 18 I wasn't at the meeting. I just don't recall 19 it. So I can't represent one way or another 20 what was discussed or not. 21 Question: It goes on and it says, it 22 was disclosed that Windows 4 (not official 23 name) will require DOS 6 as it will depend on 24 DOS for key services listed above. 25 Whether or not it was disclosed at 13329 1 this particular meeting, do you know whether 2 that type of information was disclosed to OEMs? 3 Answer: I don't recall. 4 Question: Okay. Referring back to 5 the features listed for DOS 6 there, are those 6 features features that shipped in MS-DOS 6.0 in 7 March 1993? 8 Answer: No, they were not. 9 Question: Okay. Are those features 10 that were shipped in Windows 95? 11 Answer: Windows 95 did include many 12 of those features, yes. 13 Question: Okay. Windows 95 shipped 14 in August of 1995? 15 Answer: Went to manufacturing in 16 July. 17 Question: Okay. As far as either a 18 DOS or Windows product, did any of these 19 features ship before Windows 95, and, if so, 20 which ones? 21 Answer: Yes, they did. 22 Question: Can you tell me which ones 23 and what product they shipped with? 24 Answer: Networking services and 25 protect mode device driver model shipped in -- 13330 1 the protect mode device driver model shipped in 2 Windows 3.1. 3 Question: Okay. 4 Answer: Networking services shipped 5 in Windows for WorkGroups. And the rest 6 shipped in Windows 95. 7 Question: Okay. 8 Answer: It has Windows services. 9 Question: Assuming that this is an 10 accurate summary of what was being discussed -- 11 I'm making that assumption because I don't have 12 a transcript of this briefing -- would it 13 surprise you that OEMs were being briefed in 14 September of '91 about these features? 15 Answer: I don't understand the 16 question. 17 Question: Is it Microsoft's policy to 18 disclose these types of features as far in 19 advance of them actually shipping as it appears 20 they were? 21 Answer: I think, yeah, at the time 22 that was Microsoft's view of where -- if this 23 is accurate, which I don't recall, it was 24 Microsoft's policy to describe, you know, 25 future distributions that were subject to 13331 1 change to OEMs. 2 They demanded that information from us 3 and we gave them to the best of our knowledge 4 what our current plans that were subject to 5 change. 6 Question: Okay. 7 Answer: Our Windows plans at this 8 time were very much in flux as were our MS-DOS 9 plans. 10 Microsoft was really not prepared for 11 the success of Windows when it happened. The 12 company strategy was focused on OS/2 and NT. 13 And so in this period, a lot of 14 thinking went back and forth and a lot of 15 various ideas tossed around before we settled 16 on the Windows 95 plan. 17 Question: Okay. On the sentence that 18 carries over from page 1 to page 2, it 19 discusses this being new, as in previously 20 undisclosed, information being discussed. 21 Was this type of information discussed 22 at the OEM briefing in September of 1991 23 because DR-DOS 6.0 had just shipped in 24 September 1991? 25 Answer: Well, you're asking me a 13332 1 question about a meeting that I don't recall 2 even occurred, so I can't answer that question. 3 You asked me was this discussed at a 4 meeting that I don't recall that even occurred, 5 so how can I answer that question? 6 If you want to rephrase the question, 7 I'll be glad to answer it, but the question I 8 can't answer. 9 Question: The one I originally asked 10 you about this is an overview of the 1991 OEM 11 briefing, you said that you did recall that 12 that occurred. 13 Answer: No, I didn't say that. I 14 said we have OEM briefings every year. I said 15 I didn't recall this particular meeting, where 16 it occurred or when. 17 Question: Okay. If you'll look at 18 the fifth page in, MS5054210, it's at the 19 bottom of the page. 20 Answer: Okay. 21 Question: In the middle of the page, 22 there's a dash that says MS-DOS 6 Bradsi, which 23 I believe we've established is at least your 24 e-mail name. 25 Do you recall giving a presentation on 13333 1 September 16th or 17th of 1991 to OEMs 2 discussing the features here that are being 3 summarized in this document? 4 Answer: No, I do not. 5 Question: Okay. It says, will be 100 6 percent compatible with DOS 5. 7 That was also something that was in 8 one of the pages that we looked at on Exhibit 9 1707. 10 Do you recall that? 11 Answer: Do I recall that you showed 12 it to me? 13 Question: Yeah. 14 Answer: Yes, I recall that. 15 Question: And this document does have 16 your name on the first page of it, doesn't it, 17 Exhibit 1707? 18 Answer: Yes, it does. 19 Question: Okay. It goes on, 20 preemptive multitasking threads, better memory 21 management, networking services. Features that 22 we've gone over before; correct? 23 Answer: Features that we -- 24 Question: At the bottom it says basis 25 -- at the bottom of this section it says basis 13334 1 for Win32. 2 What is Win32? 3 Answer: Win32 was a set of 32-bit 4 Windows APIs that ran on Windows 95 and Windows 5 NT. 6 Question: Was there ever a time when 7 MS-DOS 6 was going to be providing the basis 8 for Windows 32? 9 Answer: There was never a time where 10 MS-DOS 6 in any thought was going to provide 11 the Windows 32-bit APIs. 12 Question: So if this guy is 13 summarizing a speech you gave, he just got that 14 wrong; right? 15 Answer: No, that's not what I said. 16 MS-DOS 6 in none of the alternatives or ideas 17 that we tossed around was ever going to provide 18 Win32 APIs. 19 By basis for Win32 APIs, it may have 20 provided some of the underlying services by 21 which Windows 32 APIs could be implemented. 22 It's a very dramatically different statement. 23 Question: Okay. So this guy actually 24 may be summarizing correctly what you were 25 telling OEMs at this time? 13335 1 Answer: No. I just gave you an 2 explanation for what this could have meant. 3 That was the intention for one plan, one idea 4 for MS-DOS 6. 5 It was never to provide the Windows 6 32-bit APIs. It was to provide a set of 7 services upon which the Windows 32 APIs could 8 be delivered. 9 Question: Let me hand you what has 10 been marked as Exhibit 1708. 11 Answer: Okay. 12 Question: This appears to be an 13 e-mail thread. 14 Does it appear that way to you? 15 Answer: Yes, it does. 16 Question: Okay. Brad Chase is 17 sending something to Lorisi. Do you know who 18 that is? 19 Answer: I believe it's Lori Sill. 20 Question: Okay. And the original 21 e-mail was from you to Brad Chase, Mack 22 McCauley and Rich Tong; is that correct? 23 Answer: Yes. 24 Question: It's dated February 3rd, 25 1992. 13336 1 Do you recall this e-mail exchange? 2 Answer: No, I do not. 3 Question: You write, yes, we need to 4 get together to discuss. I agree that we don't 5 want to negatively affect MS-DOS 6, but 6 realistically MS-DOS 6 is still quite a ways 7 off. 8 We need to have a close look at it, 9 too, to see what's essential or what's not. I 10 presume MS-DOS won't be until mid to late '93. 11 I don't see how we can hold the fort with 12 MS-DOS 5.0. 13 Do you recall thinking in February of 14 '92 that MS-DOS 6 wouldn't be out until mid to 15 late 1993? 16 Answer: Only vague recollections. 17 Question: But that's a correct 18 statement? 19 Answer: Around that time, it's 20 possible. 21 Question: If you would refer back to 22 Exhibit 1707. 23 Answer: Which one is that? 24 Question: It's the one that's dated 25 at least in handwriting September 6, 1991. As 13337 1 we went over on the fourth page it says, DOS 2 coming soon. 3 Answer: What page, I'm sorry? 4 Question: The fourth page. It says 5 DOS, coming soon. And then it goes on to 6 discuss MS-DOS 6 plans. 7 Answer: Okay. 8 Question: Assuming that this was a 9 presentation to the OEM NCR in September of 10 1991, is it your opinion that coming soon means 11 mid to late 1993? 12 Answer: When this is -- we wouldn't 13 say coming soon if we thought it was mid to 14 late '93 at the end of '91. So I can only 15 guess that when we thought we'd ship MS-DOS 6 16 in September of this date was not mid to end of 17 '93. 18 Question: Okay. This goes -- going 19 back to Exhibit 1708, which was this e-mail. 20 Answer: Okay. 21 Question: The next paragraph says, 22 until then, if DRI was smart, they'd put us on 23 a release treadmill, get some new utils, call 24 it 6.5, get a new round of reviews, do it again 25 six to nine months later. 13338 1 Each round of review would say DRI was 2 already ahead, now they are farther ahead. 3 Once you lose a lot of ground it is very hard 4 to pick up. We need to stop losing ground 5 while making progress towards the ultimate 6 major leap MS-DOS 6. Clearly the trick is to 7 not make kernel changes and just add bought 8 utils. 9 Is utils utilities? 10 Answer: Utils would be utilities, 11 yes. 12 Question: And is that, in fact, what 13 Microsoft did, buy some utilities and release a 14 version of MS-DOS called MS-DOS 6.0? 15 Answer: Microsoft did buy some 16 utilities and include those in MS-DOS 6 and 17 cancelled this product. 18 Question: Okay. And the ultimate 19 major leap MS-DOS 6, which is being referred to 20 here in this e-mail, that was what, deferred? 21 Answer: That was cancelled. 22 Question: That was cancelled? 23 Answer: That was cancelled. 24 Question: Didn't it actually become 25 part of the product development for Chicago 13339 1 which became Windows 95? 2 Answer: No, it did not. 3 Question: How much revenue do you 4 recall -- if you recall, how much revenue did 5 Microsoft derive from the release of MS-DOS 6 6.0? 7 Answer: I don't recall. 8 Question: Over $100 million? 9 Answer: From the overall, I don't 10 know. Probably. I don't know. I don't 11 recall. 12 Question: Over -- you have no recall? 13 Over $500 million? 14 Answer: I don't recall. I'm not 15 going to play a guessing game with you because 16 I don't recall. 17 Question: Do you remember how many 18 units of MS-DOS 6.0 shipped? 19 Answer: No, I don't. 20 Question: Okay. It looks to me based 21 on this e-mail and the paragraph that we just 22 went over that Microsoft changed its plans, 23 bought some utilities and released MS-DOS 6.0 24 truly as a response to DR-DOS 6.0; is that 25 correct? 13340 1 Answer: No. 2 Question: It's not? 3 Answer: No. Microsoft cancelled this 4 project. The project was falling way behind, 5 and we came to the realization that was the 6 wrong product and we needed to cancel this 7 product and then just focus completely on 8 building Windows 95. And this team for the 9 most part was disbanded. 10 Question: We're going to get to a lot 11 of Chicago documents later. I just want to be 12 clear about one thing. 13 You're saying that MS-DOS 6, which was 14 being designed and considered at this time, 15 February 1992, did not simply move over into 16 the Chicago group in Windows 95? 17 Answer: That's correct. 18 Question: Okay. And -- 19 Answer: Many of these people, like 20 Mack McCauley, was never involved. 21 Question: Okay. The cc line says 22 David Cole. And he, of course, oversaw Windows 23 95, didn't he? 24 Answer: David Cole was involved with 25 Windows 95. 13341 1 Question: Was he just involved or did 2 he head up the project? 3 Answer: No, he was involved. He did 4 not head up the project. 5 Question: Okay. Who headed up the 6 project? 7 Answer: Well, David Cole and John 8 Ludwig together managed the development. 9 Question: Okay. 10 Answer: At this point David Cole was 11 on Windows 3.1. 12 Question: Which was going to ship in 13 April of 1992; right? 14 Answer: Whenever it shipped, yeah. 15 Question: Okay. In that paragraph 16 that we were just looking at there's the 17 statement, once you lose a lot of ground, it is 18 very hard to pick up. 19 Did you believe that MS-DOS was losing 20 ground to DR-DOS? 21 Answer: No. 22 Question: Okay. And, again, the 23 decision to release the product that became -- 24 that actually shipped as MS-DOS 6.0 had nothing 25 to do with the feature set shipping in DR-DOS 13342 1 6.0? 2 Answer: That's not what I said. 3 Question: Okay. What did you say? 4 Answer: You asked if competition with 5 DR-DOS was a factor. It wasn't the only 6 factor. It wasn't even -- my recollection, it 7 wasn't even the dominant factor. But it was a 8 factor, it was competition. 9 The nature of business is to compete 10 with each other, and that was one factor, but 11 it wasn't -- it was one factor of many and it 12 wasn't even the dominant factor. 13 Question: Okay. Mr. Silverberg, I'm 14 going to hand you a piece of paper and my pen. 15 Can you write the word Astro for me? 16 Answer: Who? 17 Question: Astro, A-s-t-r-o. 18 Answer: (Witness complies.) 19 Question: Mr. Silverberg, just before 20 the break we were talking about a word Astro. 21 Was that a code name for a project that you 22 recall? 23 Answer: It was a code name, yes. 24 Question: For what? 25 Answer: Something to do with MS-DOS. 13343 1 Question: Was it the code name for 2 MS-DOS 6.0? 3 Answer: I don't recall. 4 Question: I'll hand you what I've 5 marked as Deposition Exhibit 1709. It says 6 Astro at the top on the first page. I'll ask 7 you to take a look at these four pages and see 8 if you remember this document. 9 Okay. Do you remember this document? 10 Answer: No, I do not. 11 Question: If you turn the page 12 lengthwise, in the top corner there's the word 13 in handwriting, Astro. Is that your 14 handwriting? 15 Answer: It looks like it. 16 Question: Okay. I'm going to hand 17 you back the sheet of paper on which you wrote 18 Astro, and here's my pen. 19 Could you also write the date 9/6/91 20 and in capital letters NCR? 21 Answer: (Witness complies.) 22 Question: Okay. I want you to take a 23 look, again, Mr. Silverberg, at Exhibit 1707. 24 And, again, we're referring to this 25 9/6/91 NCR. 13344 1 Is that your handwriting? 2 Answer: I testified before I don't 3 recall. It doesn't look like it. 4 Question: It doesn't look like it, 5 okay. 6 I'm going to mark as Exhibit 1710 your 7 handwriting of the words Astro and the 9/6/91 8 NCR. 9 Answer: It doesn't look like mine. I 10 don't make 9s like that. Yeah, I don't think 11 so. 12 Question: Okay. 13 Answer: Yeah, I don't make 9s like 14 that. 15 Question: Exhibit 1709 is the 16 document that has Astro as the heading on the 17 first page; right? 18 Answer: Yes. 19 Question: Okay. And the first bullet 20 point there says, MS-DOS 5 kernel plus cool new 21 utilities equals MS-DOS 6 equals dollars. 22 Now, I can't remember what question I 23 had asked before, but did you give this 24 presentation to anyone about Astro? 25 Answer: I don't recall this 13345 1 presentation. I don't know who authored it or 2 where it came from. 3 Question: Okay. The next bullet 4 point says checkbook release. 5 Are you familiar with that term? 6 Answer: No. 7 Question: Okay. The next bullet 8 point says, acquired and in-house developed 9 utilities. Philosophy. Get excellent products 10 with low share for cheap. 11 Do you recall that being the strategy 12 for developing MS-DOS 6.0? 13 Answer: For the product, yes. That 14 was one of the strategies, yes. 15 Question: Okay. The next bullet 16 point says, defend OS. Stay aggressive. Put 17 Novell/DR on treadmill. 18 Any idea what that bullet point means? 19 Answer: Continue to enhance the 20 product, continue to innovate. 21 Question: Okay. Put Novell/DR on 22 treadmill. 23 What does that mean? 24 Answer: That means when a product 25 like DR is a clone and we continue to innovate 13346 1 and advance the product that's being cloned, 2 they're always playing catchup. 3 Question: Okay. At this point 4 Microsoft is getting ready to add utilities 5 that were already included and shipping in 6 DR-DOS 6.0; correct? 7 Answer: I don't know. 8 Question: You don't know? 9 Answer: I don't know. 10 Question: Okay. Next bullet point 11 says, hold position until big step forward, 12 Cougar. 13 Is Cougar another code name? 14 Answer: Cougar is a code name, yes. 15 Question: And which was that a code 16 name for? 17 Answer: I don't recall. 18 Question: Was it a code name for the 19 original product that was MS-DOS 6.0, but which 20 later came MS-DOS 7.0 and the DOS component of 21 Chicago? 22 Answer: No. 23 Question: Okay. The next page, 24 please, of this Exhibit 1709. It says, Astro 25 product content. First bullet point, disk 13347 1 compression. Is that a feature that shipped in 2 MS-DOS 6.0? 3 Answer: Yes, it is. 4 Question: Is that a feature that had 5 already shipped in DR-DOS 6.0? 6 Answer: I don't recall. 7 Question: Okay. There are other 8 bullet points; excellent memory management, 9 backup, defragger, antivirus, improved 10 undelete, and then there's a bullet point for 11 in-house utilities. 12 Do you know whether DR-DOS 6.0 shipped 13 -- excuse me. 14 Do you know whether DR-DOS 6.0 15 included a backup utility? 16 Answer: I don't believe it did, but I 17 don't recall what was in DR-DOS 6 anymore. 18 Question: Okay. So you don't recall 19 anything about these -- okay. You don't recall 20 any details about the product content of DR-DOS 21 6.0? 22 Answer: Not definitively, no. 23 Question: Okay. The last page says, 24 acquired utilities at the top. The last bullet 25 point says, not planning to ship diskfix or 13348 1 commute unless Novell includes in DR-DOS. 2 Was Microsoft making its plans about 3 MS-DOS 6.0 based on what was being added and 4 shipped in DR-DOS 6.0? 5 Answer: I don't know what this last 6 point refers to. I don't know what diskfix or 7 commute is. 8 The general question of was it a 9 factor, yes. Was it based on, no. 10 Question: Do you remember the first 11 time that someone from Microsoft actually 12 disclosed what the plans were going to be for 13 Chicago, which is the product that became 14 Windows 95? 15 Answer: No. 16 Question: Okay. Would it surprise 17 you that it was as early as July of 1993? 18 Answer: No. 19 Question: Okay. Is it your opinion 20 that it's okay to be disclosing product 21 features two years in advance of shipping? 22 Answer: Yes. 23 Question: That is? 24 Answer: Yes. 25 Question: Okay. I'll hand you what's 13349 1 marked as Exhibit 1711. Go ahead and take a 2 look at this. 3 Answer: Okay. I've read it quickly. 4 Question: Okay. Do you know who 5 Walter Mossberg is? 6 Answer: Yes, I do. 7 Question: Who is he? 8 Answer: He's a columnist for the Wall 9 Street Journal. 10 Question: Okay. And at the top of -- 11 what did we mark this, this is Exhibit 1711. 12 It's an e-mail from you to Pradeep 13 Singh. 14 Am I pronouncing that right, Pradeep? 15 Answer: Pradeep Singh. 16 Question: It says, you wrote, that's 17 cuz Rich T. talked to him last and explained it 18 all, exclamation point. 19 Do you recall this article that was 20 attached to your e-mail that was written? 21 Answer: Not at all, no. 22 Question: Okay. But this would have 23 been -- the article itself says -- what did it 24 say? 25 Okay, Mossberg. And on the last page 13350 1 there's a little note, WSJviaNewsEDGE. 2 Do you see that? 3 Answer: Yes, I do. 4 Question: Does that indicate that 5 this that's being sent here electronically was 6 something that was being reported in the Wall 7 Street Journal? 8 Answer: Probably, yes. It's probably 9 his Thursday column. 10 Question: And it says personal 11 technology? 12 Answer: That's the name of his 13 column. 14 Question: And that's every Thursday? 15 Answer: Typically. 16 Question: On the second page of this 17 document in the middle it says, the paragraph 18 that begins in quotes, Chicago. 19 Answer: Yes. 20 Question: And Chicago, just to be 21 clear, that was a code name for the product 22 that became Windows 95; right? 23 Answer: That's correct. 24 Question: He writes, Chicago is the 25 code name for the next mainstream version of 13351 1 Windows, due around mid 1994. 2 Likely to be called Windows 4.0, it is 3 expected to incorporate the networking features 4 of Windows for WorkGroups and, like Windows NT, 5 to be a true operating system that won't 6 require the separate MS-DOS program. 7 Did someone from Microsoft give 8 Mr. Mossberg that information? 9 Answer: I don't know. 10 Question: Okay. When you wrote -- 11 Answer: Apparently so. 12 Question: Apparently Rich Tong -- 13 Answer: Apparently Rich Tong spoke to 14 him. 15 Question: -- did? 16 Would Rich Tong have told Mr. Mossberg 17 in July of 1993 that Chicago was going to be 18 due around mid 1994? 19 Answer: It's quite possible. I think 20 at that time that was our expectation. 21 Question: And would he have also told 22 him that it wouldn't require a separate MS-DOS 23 program? 24 Answer: Yes, because it doesn't. 25 Question: Okay. It doesn't require 13352 1 it because MS-DOS is there, correct? 2 Answer: No, it's not. 3 Question: Okay. I'll hand you what 4 I'm marking as Exhibit 1712. 5 Answer: Okay. 6 Question: Now, this is an e-mail that 7 you're on the cc line; is that correct? 8 Answer: Uh-huh. 9 Question: And the subject is Toby 10 Corey (Novell). Do you know who Toby Corey is 11 or was? 12 Answer: He was something at Novell. 13 Question: Who is Bob Kruger? He's 14 the one that wrote this e-mail. 15 Answer: A guy who used to work at 16 Microsoft. 17 Question: Do you know who he is? 18 Answer: Yeah, I know who he is. 19 Question: What was his response? 20 Mr. Holley: At this time? 21 Question: Yeah, at this time when he 22 was writing this. 23 Answer: I don't know for sure. 24 Question: I mean, was he in the 25 Windows group? Did he report to you? 13353 1 Answer: No, he did not work in my 2 organization. 3 Question: His first paragraph he 4 writes, Toby called this morning. He's the 5 director, marketing for DR-DOS 7. Said he 6 wanted to resume conversation he started 7 sometime ago with Tonya re: Working together to 8 ensure Windows runs smoothly atop DR-DOS 7. 9 Is Tony A. Tony Audino? 10 Answer: Tony A is Tony Audino, yes. 11 Question: Oh, okay. First sentence. 12 My impression is that we have little interest 13 in ensuring that Windows runs okay atop their 14 DOS. 15 Do you agree with that sentiment? 16 Answer: I agree that we had little 17 interest in helping an operating system 18 competitor. 19 Question: Was Novell permitted to be 20 a beta site for the Chicago project? 21 Answer: As with other operating 22 system competitors, no, they were not. 23 Question: Okay. By the summer of 24 1994, the Chicago project was beginning to 25 garner front page reviews on some of their 13354 1 weekly and monthly computer magazines; isn't 2 that correct? 3 Answer: It's possible. 4 Question: Okay. I mean, weren't you 5 all making broad presentations to magazine 6 reviewers -- 7 Answer: I don't recall. 8 Question: -- just prior to the summer 9 of 1994? 10 Answer: I don't recall the timing. 11 Question: Okay. Let me hand you 12 what's marked as Exhibit -- 13 Answer: In 1994, it's possible. 14 Question: Okay. Let me hand you 15 what's been marked as Exhibit 1713, and I will 16 state for the record that this is the beginning 17 of a document that runs through MSC 00246362. 18 I've only included the beginning here 19 because it appears to be a presentation by 20 Mr. Silverberg, and I don't want there to be 21 any confusion about the fact that this was a 22 longer document. 23 Answer: Okay. 24 Question: Okay. Do you recall the 25 Microsoft Windows Chicago reviewers workshop 13355 1 that took place on May 1, 1994? 2 Answer: I recall we had a reviewers 3 workshop. I don't recall if that was -- I 4 don't recall anything much about it. I don't 5 know if that was the date. Apparently it was. 6 Question: Okay. Do you recall giving 7 a presentation there? 8 Answer: No. 9 Question: Okay. Do you remember how 10 many editors and analysts from various 11 magazines around the world attended? 12 Answer: Where was it held? Do you 13 know where it was held? That might help jog my 14 memory. No. 15 Question: Well, before we discuss 16 that, just to clear this up, let me hand you 17 what's been marked as Exhibit 1714. 18 And this is an e-mail from Pam K, who 19 appears to be someone from Weggener Edstrom, 20 and the subject is Chicago reviewers workshop 21 postmortem. 22 And it says on the first page, 23 executive summary, more than 130 editors and 24 analysts from around the world attended the 25 Chicago reviewers workshop on May 12 and 13. 13356 1 Does that refresh your recollection 2 that over 100 editors and analysts attended 3 this conference or this workshop? 4 Answer: No. It's possible. 5 Question: Okay. 6 Answer: It's possible, sure. 7 Question: And then going back to 8 Exhibit 1713, four pages in -- or fifth page 9 in, there's a PowerPoint slide that says, 10 Microsoft systems strategy, Brad Silverberg, 11 vice president, personal operating systems 12 division, Microsoft Corporation. 13 Was this a presentation that you 14 prepared? 15 Answer: I don't recall the 16 presentation, so I don't know whether I 17 prepared it or somebody else prepared it for me 18 or whether I gave it -- I have a vague 19 recollection of a reviewers workshop. It's 20 possible. 21 Question: Okay. This has what looks 22 to me like a PowerPoint slide up at the top 23 with some blank lines below. 24 At this type of workshop, is it 25 Microsoft's practice to hand out the slides 13357 1 that are going to be going up during the 2 presentation with space for the people 3 attending to take notes on those slides? 4 Answer: This is one of the formats 5 that you can use to print out PowerPoint 6 presentations, so I don't know what Microsoft's 7 practice was. 8 Question: Has that ever happened? 9 Did these things get handed out to people who 10 are sitting in the audience sometimes? 11 Answer: Presentations do get handed 12 out, they're part of a binder, but I don't know 13 if this is one where a presentation was 14 actually given or a draft or what. 15 Question: Okay. On the third page of 16 the slides, and it's got the Bates number MSC 17 00246101. 18 Answer: Okay. 19 Question: The top says rules of 20 engage. First bullet point, feel free to write 21 about what is discussed here. Next bullet 22 point, NDA required to get a code. 23 I take it by that it means the 24 reviewers are allowed to discuss, to write 25 about anything that's going to be talked about 13358 1 during the presentation, but if they actually 2 want to have code, they're going to have to go 3 under nondisclosure; right? 4 Answer: That is correct. 5 Question: But the anticipation was 6 that these reviewers would be writing something 7 about what was being discussed? 8 Answer: We anticipated writers wanted 9 to write something about it and we wanted to 10 help explain what the goals of the product 11 were. But it wasn't in a position to have a 12 detailed review so the NDA would cover that. 13 Question: Okay. If you go a few more 14 pages in, at the bottom of the page, MSC 15 00246106, the slide at the top says, what is 16 Windows Chicago? 17 I think you just passed it. Oh, wait, 18 yeah, that's it. 19 First bullet point, more powerful, 20 bootable, doesn't require separate MS-DOS. And 21 that's something that reviewers were going to 22 be allowed to write about as a takeaway from 23 this conference; right? 24 Answer: Yes. 25 Question: And second page from the 13359 1 end, MSC 00246109, schedule and packaging for 2 Windows Chicago, the third bullet point, ship: 3 2H 1994. 4 Is that the second half 1994? 5 Answer: Second half calendar year 6 1994. 7 Question: So this presentation being 8 given in May of 1994 is indicating shipment in 9 the next six months? 10 Answer: That was our expectation at 11 that point, yes. 12 (Whereupon, playing of the video 13 adjourned.) 14 THE COURT: We are going to take a 15 break at this time. 16 Remember the admonition previously 17 given. We'll be in recess for ten minutes. 18 Leave your notebooks here. 19 Thank you. 20 (A recess was taken from 1:27 p.m. 21 to 1:43 p.m.) 22 THE COURT: Everyone else may be 23 seated. 24 Please continue with the videotape 25 deposition of Mr. Silverberg. 13360 1 (Whereupon, the following video was 2 played to the jury.) 3 Question: And one of the packaging 4 decisions was going to be ship the MS-DOS 5 component separately; correct? 6 Answer: No. 7 Question: Okay. Would it have been 8 possible to sever out a DOS component of 9 Chicago and ship it separately as a package? 10 Answer: It was conceivable to strip 11 out something and label it MS-DOS that had 12 virtually nothing to do in common with anything 13 that we had shipped as MS-DOS before. 14 Question: Then the last page says, 15 let the demonstrations begin. And does that 16 mean that actual demonstrations of Chicago in 17 operation were presented to the reviewers? 18 Answer: Yes. 19 Question: Okay. And following this 20 presentation in May of 1994, PC/computing 21 devoted their July cover story to Chicago and 22 PC World wrote a first looks review in its 23 August issue; is that correct? 24 Answer: I don't know. 25 Question: Okay. Let's look at 13361 1 Exhibit 1714, which is this e-mail we've 2 previously marked. 3 And if you'll look at the -- still 4 under the executive summary, fourth paragraph 5 begins, based on the content of the workshop, 6 many of the publications are now planning their 7 first looks reviews. 8 Incredibly, PC/computing felt that the 9 material presented was comprehensive enough 10 that their first looks review will be based on 11 the material presented at the workshop and one 12 hour of hands-on time at the end of the 13 workshop. 14 Were the reviewers actually given some 15 hands-on time to start fiddling around with, 16 you know, Chicago? 17 Answer: I don't know. 18 Question: It goes on, their review is 19 scheduled to appear as a cover story in the 20 July issue. 21 Do you know whether that happened? 22 Answer: I don't know. 23 Question: Additionally, PC World, who 24 was originally planning to wait until September 25 or October issues to run a first looks review, 13362 1 has decided that Chicago is too cool to wait. 2 They are now planning to run a review in the 3 August issue. 4 Do you know whether that happened? 5 Answer: No, I don't. 6 Question: By the summer of 1994, do 7 you agree that there was a high amount of 8 interest in the Chicago product by the media? 9 Answer: There was interest, yes. 10 There was quite a bit of interest by the media 11 and developers. 12 Question: And a lot was being written 13 about the product at that time; correct? 14 Answer: Yes. 15 Question: Do you recall -- do you 16 recall that Microsoft started making 17 information about Chicago available online? 18 Answer: No. 19 Question: Do you remember Microsoft 20 developing a web page or a separate part of its 21 website devoted to information about the 22 Windows 95 product? 23 Answer: No, I do not. 24 Question: Okay. Let me hand you 25 what's been marked as Exhibit 1715. 13363 1 Answer: Okay. 2 Question: This is an e-mail. At the 3 top it's an e-mail from you to Steven Sinofsky. 4 It's regarding Microsoft makes data on Windows 5 Chicago available online. 6 And what's been forwarded to you 7 appears to me to be a press release from 8 Weggener Edstrom concerning that fact. Is that 9 -- 10 Answer: I don't think the press 11 release came from Weggener Edstrom. 12 Question: On the last page -- 13 Answer: It just says they're our 14 contact. 15 Question: Oh, okay. All right. Is 16 it a press release from Microsoft, does it 17 appear to you? 18 Answer: Appears to be a press release 19 from Microsoft, yes. 20 Question: Okay, that's fine. 21 And the press release says, it's dated 22 June 22, 1994. The press release states at the 23 beginning, Microsoft Corporation today 24 announced its Win news forum, which makes 25 information on Windows Chicago, the next 13364 1 upgrade to the Microsoft Windows operating 2 system, available to millions of individuals 3 worldwide. 4 Do you recall the Win news forum? 5 Answer: I recall something called Win 6 news. I don't recall it as a forum. 7 Question: What do you recall about 8 it? 9 Answer: It was like a mailing list 10 that we mailed information about Windows to 11 people. People would subscribe to Windows and 12 then they'd get mailings about information 13 about Windows. 14 Question: Okay. The press release 15 goes on, operating through networks and 16 electronic services that reach more than 25 17 million people, Win news is the industry's 18 largest effort to make detailed information 19 broadly accessible prior to a product launch. 20 Is that a correct statement of what 21 the Win news forum was being used for in 22 regards to Chicago? 23 Answer: Win news, as I just 24 testified, was a mailing list that we would 25 mail people who subscribe to that forum -- to 13365 1 that -- it's not a forum, to that list, 2 information about Windows, including 3 forthcoming product information. 4 Question: And the next paragraph 5 says, Microsoft created this forum in response 6 to unprecedented customer interest. The forum 7 is available over America Online, CompuServe, 8 GEnie, the Internet and Prodigy. 9 Win news comprises the largest 10 collection of Windows Chicago-related 11 information anywhere, containing more than 5 12 megabytes of text and graphics data in more 13 than 30 different documents, including Q and 14 As, background material and technical 15 documents. 16 Microsoft plans to update the forum 17 continually with new documents as they are 18 created. 19 Do you recall 5 megabytes of text and 20 graphics being posted to this site? 21 Answer: Do I remember all 5 22 megabytes? No. 23 Question: Mr. Silverberg, what are 24 the purposes of beta tests of software? 25 Answer: Well, there are many purposes 13366 1 from beta tests. 2 Question: What purposes are you aware 3 of? 4 Answer: Some of them include getting 5 feedback from users, developers, OEMs, 6 potential customers and partners for the 7 features that you've included in the product. 8 Get feedback, are you building the 9 right product or wrong product, good things, 10 bad things, bug testing. 11 Help identify problems, flaws, get 12 suggestions for additional features, things 13 that you've missed, things that you included 14 and you shouldn't include. Help in the process 15 of getting the product to the customers in 16 final shipment form. 17 Question: Okay. How does Microsoft 18 determine who will be allowed to be a beta site 19 on an operating system beta cycle? 20 Answer: I can't speak for all of 21 Microsoft. 22 Question: For products that you 23 oversaw. Let's, you know, limit it to MS-DOS 24 and Windows products. I don't know what other 25 products you may have been working on, but 13367 1 those are obviously the ones we're talking 2 about here. 3 Answer: Well, people would have to 4 sign an NDA, and various companies such as 5 operating system competitors or other 6 companies, which have been known to violate the 7 NDA in one way or another would be excluded. 8 Question: Okay. Do you know whether 9 DRI was on the -- was a beta site for Windows 10 3.0? 11 Answer: 3.0, I don't know. 12 Question: You don't know? 13 Do you recall ever adding them to what 14 Microsoft calls the beta blacklist? 15 Answer: Yes, I do. 16 Question: Okay. Did you add them to 17 that list? 18 Answer: I was aware they were added. 19 I don't know if I was the one who added them. 20 Question: Why would -- why was DRI 21 added to that list? 22 Answer: DRI was an operating system 23 competitor. 24 Question: When were they added to the 25 list? 13368 1 Answer: I don't know. 2 Question: Do you recall whether it 3 was in conjunction with the Windows 3.1 beta 4 cycle? 5 Answer: No, I don't. 6 Question: Okay. Let me hand you what 7 I've marked as Exhibit 1716, and I'm going to 8 be referring to the e-mail that begins at the 9 bottom of the page and goes over to the top of 10 the second page. 11 Answer: Okay. 12 Question: Okay. This is dated June 13 1991. 14 Answer: Yes. 15 Question: June 10th, 1991. The first 16 part of the e-mail thread is from you to that 17 Naveenj. Is that that Naveen Jane? 18 Answer: That Naveen J. is that Naveen 19 Jane, yes. 20 Question: And who was he? 21 Answer: I think he was a program 22 manager. 23 Question: For Windows products? 24 Answer: I think MS-DOS. 25 Question: Okay. 13369 1 Answer: I'm pretty sure MS-DOS. 2 Question: And the subject is DR-DOS 3 and task switcher. 4 And you write, I want to know how the 5 -- it probably should be they -- got sent the 6 task switch API. 7 What is the task switch API? 8 Answer: MS-DOS 5 had a task switch 9 API. I presume that's what he's referring to. 10 Question: Okay. Second paragraph 11 says, after I learned that we sent DR the Win 12 VxD I went on a rampage and everyone assured me 13 DR was off of all our mailing lists. 14 What is the Win VxD? 15 Answer: I don't recall. 16 Question: Do you recall going on a 17 rampage about it? 18 Answer: I recall remembering that DR 19 got something they weren't supposed to, and I 20 was not happy about that. 21 Question: Okay. And thereafter it 22 was very clear that they were -- that DRI was 23 supposed to be on the beta black license; 24 correct? 25 Answer: As an operating system 13370 1 competitor, operating system competitors were 2 not getting advanced looks at our future 3 products. 4 Question: And is it your contention 5 that DR-DOS was a competitive product with 6 Windows 3.1? 7 Answer: It was my contention that 8 Digital Research was a developer of competitive 9 operating systems and were working on, among 10 other things, competitive products to Windows. 11 They had graphical operating systems 12 in the past, they had the capability to develop 13 graphical operating systems. They were on the 14 record stating they were developing competitors 15 to Windows. And, in fact, we know they were 16 developing competitors to Windows. So, yes, 17 DRI was a competitor. 18 Question: The question was, is it 19 your contention that DR-DOS was a product 20 competitive with Windows 3.1? 21 Answer: I answered that. 22 Digital Research was a developer of 23 competitive operating systems, and that was 24 included in that. 25 Question: Does DR-DOS compete with 13371 1 Windows 3.1? 2 Answer: Yes. 3 Question: Does Windows 3.1 -- did 4 Windows 3.1 run on top of MS-DOS? 5 Answer: In part, yes. 6 Question: And did Windows 3.1 run on 7 top of DR-DOS? 8 Answer: I don't know. 9 Question: You don't know? 10 Answer: No. 11 Question: Now, Microsoft didn't 12 always refer to Windows as an operating system, 13 did it? 14 Answer: Not always. 15 Question: I mean, there was a 16 specific decision to begin referring to Windows 17 as an operating system at the time DRI was put 18 on the beta blacklist; isn't that correct? 19 Answer: No. 20 Question: That's not correct? 21 Answer: Not that I recall. 22 Question: Okay. Let me hand you what 23 I'm marking as Exhibit 1718. 24 I'm looking at the second full e-mail 25 on the thread. Number 128, subject 13372 1 backgrounder. 2 Would you review that one, please? 3 Can you read it into the record, 4 please? It's brief. 5 Answer: We recently decided to start 6 referring to Windows as an operating system in 7 our communications, not a graphical environment 8 or user interface for DOS. We should be 9 consistent in the new usage. Thanks. 10 Question: Thanks. 11 So prior to this Microsoft referred to 12 Windows as a graphical environment or user 13 interface for DOS; correct? 14 Answer: Microsoft prior to this 15 referred to Windows occasionally sometimes as 16 an operating system, sometimes as a graphical 17 environment, sometimes as other things. And I 18 wanted us to be consistent in our usage going 19 forward. 20 Question: And one of the reasons for 21 that is so that when people asked you about DRI 22 being on the beta blacklist, you could say it's 23 because DRI is an operating systems competitor 24 and Windows is an operating system; correct? 25 Answer: False. 13373 1 Question: This is Exhibit 1717. 2 Are you familiar with this document? 3 Answer: I was shown it briefly 4 yesterday by counsel. 5 Question: Okay. It says at the top, 6 Windows/DOS beta blacklist; correct? 7 Answer: Yes, it does. 8 Question: I just want to make sure 9 we're looking at the same document. 10 Down at the bottom it has a date 11 7/13/91, which I take it would be shorthand for 12 July 13, 1991? 13 Answer: I presume so. 14 Question: Okay. And, to your 15 knowledge, does this reflect who is on the 16 Windows and DOS beta blacklist as of July '91? 17 Answer: I don't know. 18 Question: It does indicate that 19 Digital Research, and in parentheses DRI, is on 20 the beta blacklist; correct? 21 Answer: Yes, it does. 22 For which product are you referring 23 to? 24 Question: Windows 3.1. I think it's 25 actually under it for all of them. Yeah, it's 13374 1 under it for all of them. 2 Answer: Yes, it is. 3 Question: Okay. And I also noticed 4 that Novell is not listed under any of these 5 products. Correct me if I'm wrong about that, 6 but do you see Novell being -- 7 Answer: I do not. 8 Question: Okay. But at some point 9 Novell was added to the Windows/DOS beta 10 blacklist? 11 Answer: I don't know. I don't 12 recall. 13 Question: Would they have been added 14 to the Windows/DOS beta blacklist after they 15 bought DRI? 16 Answer: It's possible. The blacklist 17 didn't mean nobody could ever receive it. It 18 meant that it couldn't just be sent out without 19 question. 20 Question: It had to be cleared with 21 somebody? 22 Answer: It had to be cleared. And 23 there were people at Novell who did get betas 24 of Microsoft operating systems. 25 Question: And, for instance, this 13375 1 beta blacklist under Windows 3.1, on a couple 2 of them, but beside it it says Janineh clear. 3 Who is Janineh? 4 Answer: Janine H. was Janine 5 Harrison. 6 Question: So it's saying before it 7 goes to one of them you've got to clear it with 8 her? 9 Answer: You need to talk to Janine, 10 yes. 11 Question: Okay. Let me hand you -- 12 well, let me ask this. 13 This beta blacklist as we've indicated 14 is dated July '91. Was Microsoft at that point 15 engaged in a FUD campaign against DR-DOS? 16 Answer: No. 17 Question: All right. Let me hand you 18 what was marked as Exhibit 38 to Mr. Gates' 19 deposition. 20 That middle e-mail is from you on July 21 22, 1991 to Bill Gates, Jon Lazarus, Mike 22 Hallman, Paul Maritz, Rob G. -- I don't know 23 who that is -- and Steve Ballmer. Subject: 24 DOS. 25 Second to the last paragraph, we are 13376 1 engaged in a FUD campaign to let the press know 2 about some of the bugs. We'll provide info, a 3 few bugs at a time to stretch it out. 4 So, Mr. Silverberg, in fact, Microsoft 5 was engaged in a FUD campaign in February of 6 1991; correct? 7 Answer: No, we weren't. 8 I would hint, in this time frame in 9 1991, there were people at Microsoft, including 10 myself on occasion, who used the term FUD in a 11 loose colloquial fashion always referring to 12 something that was factually based. 13 I have learned since that other people 14 regard the word FUD in very different terms. 15 And, in fact, I perhaps assumed you were using 16 the word FUD in those very different terms when 17 you asked me that question. 18 And so I was responding based on my 19 inference, and perhaps I should have asked for 20 a clarification of how you intended to use that 21 term. 22 Question: I am correct that you state 23 in this e-mail, we are engaged in a FUD 24 campaign to let the press know about some of 25 the bugs. You did write that to Mr. Bill 13377 1 Gates, didn't you? 2 Answer: I did write that. And as I 3 just mentioned, my intention was to describe to 4 the press factual information about problems 5 that were known about DR-DOS. 6 Question: What is FUD an acronym for? 7 Answer: FUD was coined by the IBM 8 Corporation to mean fear, uncertainty, and 9 doubt. 10 Question: And you say, we'll provide 11 info a few bugs at a time to stretch it out. 12 Is it your testimony that all of this 13 information about bugs that you're giving out 14 was truthful? 15 Answer: Yes. 16 Question: Why would you then stretch 17 it out instead of just give it to the media all 18 at once? 19 Answer: For maximal effect. 20 Question: And the maximal effect 21 being to create fear, uncertainty, and doubt 22 about the product and deter people from buying 23 DR-DOS products; correct? 24 Answer: False. 25 Question: What maximal effect are you 13378 1 referring to? 2 Answer: Maximal effect to arm the 3 press with factual information about the 4 shortcomings, incompatibilities, and bugs that 5 DR-DOS possessed. 6 Question: And you would do that so 7 people wouldn't buy DR-DOS; correct? 8 Answer: No. So the press would be 9 reminded. 10 Sometimes the press would run a story 11 and then they'd write another story a month 12 later completely forgetting the factual 13 information we had communicated. 14 So we wanted to make sure that they 15 were aware on an ongoing basis of some of the 16 problems that were associated, factual 17 problems, certifiable, reproducible problems 18 with DR-DOS. 19 Question: And you're saying that that 20 decision, to engage in a FUD campaign and 21 provide info a few bugs at a time to stretch it 22 out, had nothing to do with whether or not 23 people would be buying DR-DOS? 24 Answer: People would then have the 25 ability to make a decision whether they wanted 13379 1 to buy the product or not based on, then, their 2 enhanced information, information that was not 3 being communicated by Digital Research about 4 some of these problems. 5 Question: Okay. 6 Answer: So customers had a very 7 incomplete picture of the state of that 8 product. 9 Digital Research was claiming 100 10 percent compatibility. We knew quite 11 otherwise, and we wanted to make sure the press 12 was aware of that information so they could 13 provide better information or accurate 14 information to the readers, who could then use 15 that information to then make buying decisions. 16 Question: And part of that decision 17 being to not buy DR-DOS; correct? 18 Answer: The more they know about it, 19 then, they can make a decision whether that 20 product is appropriate to them or not. 21 Question: So you wanted end users and 22 OEMs to be buying products based on full 23 information; correct? 24 Answer: We wanted customers to be 25 aware of information about our products and 13380 1 competitors' products, and you let them use 2 that information to make their decisions. 3 Question: Let's look back at Exhibit 4 1703, which is a -- we went over this earlier 5 this morning, the subject is bug list, and it's 6 got bug numbers. 7 Were these bugs disclosed to the press 8 so that they could inform buyers and have all 9 the information necessary needed to make a 10 buying decision? 11 Answer: I don't know. 12 Question: Okay. Did Microsoft make 13 it a habit of disclosing its own bugs to the 14 media so that everybody could have this 15 informed decision? 16 Answer: Sometimes, yes. 17 Question: Sometimes? 18 Answer: Uh-huh. 19 Question: Which ones in particular do 20 you have in mind? 21 Answer: Oh, we've announced that 22 there have been bugs that we've fixed, 23 announced the security bugs and; i.e., that 24 were discovered. We disclosed those to the 25 press and fixed them. Problems with Windows 13381 1 95, we would disclose them and fix them. 2 Question: And do you disclose them a 3 few bugs at a time to stretch it out? 4 Answer: We don't. 5 Question: Also in July of 1991, 6 Microsoft began communicating to the beta users 7 that Microsoft wasn't going to be supporting 8 DRI as far as Windows 3.1 is concerned; 9 correct? 10 Answer: I don't know. 11 Question: When did Microsoft begin 12 disclosing that to the beta users? 13 Answer: I don't know. I don't know 14 if we did. 15 Question: Okay. 16 Answer: I don't recall. 17 Question: No recall? 18 Answer: No. 19 Question: I'll hand you what's been 20 marked as Exhibit 1719. You'll be looking at 21 the e-mail that begins at the very bottom of 22 the page and continues over to the top of the 23 next page. 24 And then also the next one-sentence 25 e-mail that follows it. 13382 1 This first one that's numbered 194, do 2 you know who all these people are on the to and 3 cc line? 4 Answer: No, I do not. 5 Question: On the cc line, were these 6 persons working on Windows or on DOS? 7 Answer: Don't know. Don't know who a 8 number of these people are. 9 Question: David Cole? 10 Answer: David Cole I know. 11 Question: Windows or DOS? 12 Answer: Windows. 13 Question: Karlst? 14 Answer: Windows. 15 Question: That's Karl Stock? 16 Answer: Karl Stock. 17 Question: Philba, Phil Barrett, 18 Windows? 19 Answer: Phil Barrett, Phil had 20 responsibility for both Windows and MS-DOS at 21 some point. I don't know when he stopped 22 having responsibility for MS-DOS. I don't know 23 if that was then or not. 24 Question: Okay. Ralphl, Ralph Lipe? 25 Answer: Ralph Lipe. 13383 1 Question: And Windows or DOS? 2 Answer: Officially Windows. 3 Question: Okay. And you're 4 communicating to them, we are not going to 5 support DRI in the future either. Windows 6 works on MS-DOS and PC-DOS 3.1 and above. 7 Do you recall why you're sending that 8 to them? 9 Answer: No. 10 Question: And the subject is 11 something about -- that's being forwarded, it's 12 a discussion about Digital Research. 13 Any idea what that is? 14 Answer: No. 15 Question: Now, I note that the next 16 e-mail says, Windows supports MS-DOS and PC-DOS 17 3.1 and above. 18 And in the previous e-mail, you state, 19 Windows works on MS-DOS and PC-DOS 3.1 and 20 above. 21 Answer: Okay. 22 Question: Okay. 23 Answer: There's a semantic fineness 24 here on this. 25 Question: I just want to make sure 13384 1 that it's only semantics. 2 I mean, you weren't going to be 3 instructing these people in the future to be 4 designing something in Windows so that it was 5 only going to be working on MS-DOS and PC-DOS, 6 were you? 7 Answer: No. 8 Question: And you would never have 9 given any direction to anyone to make sure that 10 Windows wouldn't work with DR-DOS; correct? 11 Answer: That's correct. 12 Question: And just going back to 13 e-mail 195, the people on the to line there, do 14 you know who those people are? 15 Answer: I know who Janineh is. 16 Question: Okay. We talked about her 17 before. 18 Answer: Right. I don't know who 19 Theresa is or Stevetho is. And I think I know 20 who Jancl is, but I'm not positive. 21 Question: Jan Claasen? 22 Answer: It could be. 23 Question: Who was that? 24 Answer: He was somewhere in OEM at 25 the time, I believe. 13385 1 Question: Somewhere in OEM? 2 Answer: Uh-huh. 3 Question: So if you're telling him 4 this, would he be communicating that to OEMs, 5 that Windows supports MS-DOS and PC-DOS 3.1 and 6 above? 7 Answer: I don't know. 8 Question: Was it your intention that 9 people begin communicating that to OEMs? 10 Answer: I don't know what my 11 intention was. It was a statement here. 12 Question: Okay. 13 Do you recall if DRI ever made a 14 specific request to be a beta site for Windows 15 3.1? 16 Answer: I don't recall. 17 Question: You would have said no if 18 they asked, wouldn't you? 19 Answer: Yes. 20 Question: Would you have laughed at 21 the request? 22 Answer: Possibly. 23 Question: Okay. Look at Exhibit 24 1720, the bottom e-mail, starts on the first 25 page and goes on to the second page. 13386 1 Answer: Okay. 2 Question: This appears to me to 3 indicate that John Constant of DRI made a 4 specific request to Microsoft to become a beta 5 site. 6 Is that how you read this? 7 Answer: Yes. 8 Question: And what was your response 9 to that? 10 Answer: I was amused. 11 Question: Can you read it, please? 12 Answer: Ha ha ha ha. Kala, please 13 make sure this request doesn't get filled. 14 Question: And Digital Research was 15 not, in fact, part of the beta test cycle for 16 Windows 3.1; right? 17 Answer: As an operating system 18 competitor, that is correct. 19 Question: Okay. Do you have an 20 understanding why Digital Research would want 21 to become a beta site? 22 Answer: There could be many reasons 23 why they wanted to become a beta site. 24 Question: Would one of the reasons be 25 so that they could ensure compatibility with 13387 1 DR-DOS with Windows 3.1? 2 Answer: One of the reasons could be 3 they were developing other competitors to 4 Windows. 5 Question: Could one of the reasons be 6 that they wanted to ensure compatibility of 7 DR-DOS with Windows 3.1? 8 Answer: I don't know why they wanted 9 it. They never told me why they wanted it. 10 Question: Okay. Let's look back at 11 Exhibit 1720, then. 12 Answer: All right. 13 Question: Then John Constant wrote, 14 Digital Research would like to become a beta 15 site. They would like to enable their 16 operating system to support Windows 3.10. 17 So Digital Research at least was 18 telling Microsoft that they wanted to make sure 19 their operating system would support Windows 20 3.1; right? 21 Answer: That's what they were saying. 22 Question: Okay. Microsoft was also 23 conducting tests at this time on DR-DOS 6, 24 wasn't it? 25 Answer: I recall that Microsoft 13388 1 commissioned tests from an outside independent 2 agency for marketing purposes on DR-DOS. 3 Question: People within Microsoft 4 itself participated in testing of DR-DOS 6.0 in 5 September of 1991, didn't they, Mr. Silverberg? 6 Answer: I don't recall. 7 Question: Let me hand you what's been 8 marked as Exhibit 1721. The e-mail at the 9 bottom numbered 421 is what we'll be looking 10 at. 11 Answer: 421, okay. Okay. 12 Question: This is from you to 13 vanguard. And that is an e-mail alias; 14 correct? 15 Answer: It must be. I don't recall 16 what it is. 17 Question: You don't recall who 18 vanguard was composed of? 19 Answer: No, I do not. 20 Question: Okay. You write, I want to 21 thank everyone for the great job on testing 22 DR-DOS 6. Lots of great problems; also good 23 comments on ways we can improve. 24 Does that refresh your recollection 25 that testing was occurring on DR-DOS 6? 13389 1 Answer: I don't know who vanguard is, 2 so it's possible. 3 Question: Okay. Lots of great 4 problems. 5 Those are problems that you want to 6 start disclosing to the media; correct? 7 Answer: Perhaps. 8 Question: And, also, good comments on 9 ways we can improve. 10 So you're using testing of DR-DOS 6 to 11 determine how to improve Microsoft products; 12 correct? 13 Answer: I don't recall this e-mail, 14 so I can't really comment on it. 15 Question: Okay. Novell had announced 16 they were going to buy DRI in July of 1991; 17 correct? 18 Answer: I don't know. 19 Question: You don't recall that at 20 all? 21 Answer: I don't recall the date. 22 Question: Okay. 23 Answer: It's a fact Novell announced 24 they were going to buy DRI. I don't know when. 25 Question: Would you agree with me 13390 1 that by the end of September of 1991, there 2 were several Windows product developers who 3 were requesting that intentional 4 incompatibilities be built into Windows 3.1 to 5 ensure that it would not work on DR-DOS? 6 Answer: No. 7 Question: You don't recall that? 8 Answer: No. 9 Question: Let me hand you what's been 10 marked as Exhibit 1722. And we'll be looking 11 at the middle e-mail from David Cole to Karl 12 Stock and Phil Barrett, cc'd to you, subject is 13 supported DOSes, dated September 30, 1991. 14 Please take a moment to refresh 15 yourself on this one. 16 Answer: Okay. 17 Question: Okay. I actually want to 18 clarify the record. I marked this and handed 19 it to you as Exhibit 1722. I didn't note that 20 this was actually already marked as Exhibit 21 1115 in a previous depo. 22 So we'll refer to it by that exhibit 23 number rather than introduce two with the same 24 number. 25 Okay? 13391 1 Answer: Fine with me. 2 Question: Sure. 3 So this is Exhibit 1115, which I 4 believe was entered in the Phil Barrett 5 deposition. 6 Have you ever seen this e-mail before? 7 Answer: I don't recall seeing it. 8 Question: Is this one that you went 9 over with counsel yesterday? 10 Answer: I don't recall seeing this 11 one yesterday. 12 Question: Who is Mr. Cole? 13 Answer: David Cole. 14 Question: Yeah, David Cole. 15 He's a Windows developer; correct? 16 Answer: He was a Windows program 17 manager. 18 Question: Working on the technical 19 aspects of the Windows 3.1 product? 20 Answer: Working on product features, 21 program management. He didn't write code. 22 Question: But was he -- as opposed to 23 taking care of marketing, was he in charge of 24 taking care of the people that were writing the 25 code? 13392 1 Answer: No. 2 Question: What was he in charge of? 3 Answer: Program management. 4 Question: Which means what? 5 Answer: People writing the code did 6 not work for Mr. Cole nor did the people 7 testing the code work for Mr. Cole. 8 Question: Who did the people writing 9 the code work for? 10 Answer: People writing the code 11 worked either for Mr. Stock or Mr. Barrett at 12 that point. 13 Question: So Mr. Cole was writing 14 this to the people that were in charge of the 15 code; is that your understanding? 16 Answer: That's what it appears. 17 Question: And then he says, it's 18 pretty clear we need to make sure Windows 3.1 19 only runs on top of MS-DOS or an OEM version of 20 it. 21 Do you agree with that statement? 22 Answer: No. 23 Question: He goes on, I checked with 24 legal, and they are working up some text we are 25 supposed to display if someone tries to set up 13393 1 or run Windows on an alien operating system. 2 And you recall that there was 3 considerable discussion about what message was 4 going to be displayed upon start-up; correct? 5 Answer: There was some discussion. I 6 don't recall the discussion very clearly at 7 all. 8 Question: Okay. And something was 9 coded into the Windows 3.1 beta to test whether 10 or not Windows 3.1 was being loaded on top of 11 MS-DOS or some other operating system; correct? 12 Answer: False. 13 Question: Tell me what's false about 14 that statement. 15 Answer: That was code to test whether 16 it was running on top of MS-DOS. And that was 17 the only test for MS-DOS. 18 Question: He goes on, we are supposed 19 to give the user the option of continuing after 20 the warning. However, we should surely crash 21 at some point shortly later. 22 Did you agree that that's what Windows 23 3.1 should do? 24 Answer: No. 25 Question: Let me read that again. 13394 1 Now, to the point of this mail. How 2 shall we proceed on the issue of making sure 3 Windows 3.1 requires MS-DOS? 4 What was ultimately done to ensure 5 that Windows 3.1 would require MS-DOS? 6 Answer: Nothing that I'm aware of. 7 Question: What about Windows 95? 8 Answer: What was the question? What 9 about -- what about Windows 95? 10 Question: That was not Microsoft's 11 way of making sure that Windows would require 12 MS-DOS? 13 Answer: I thought you were referring 14 to Windows 3.1. So you have another question. 15 Can you state what that question is? 16 Question: Well, as to Windows 95, 17 then, what version of Windows? Is that Windows 18 4.0 running on top of MS-DOS 7.X? 19 Answer: No. 20 Question: It's not? 21 Answer: No. 22 Question: Was anything done to make 23 sure Windows 3.1 would require MS-DOS? 24 Answer: No. 25 Question: He goes on, we need to have 13395 1 some pretty fancy internal checks to make sure 2 we are on the right one. 3 Maybe there are several very 4 sophisticated checks so the competitors get put 5 on a treadmill. 6 Do you have any idea what he means by 7 putting competitors on a treadmill? 8 Answer: Yes. That if we were to 9 develop a check for MS-DOS, we wanted to make 10 sure that it wasn't something easily defeated. 11 Question: Okay. Aaronr -- continuing 12 on with this e-mail, Aaronr -- and I take it 13 that's Aaron Reynolds; correct? 14 Answer: Was that a question? 15 Question: That is. 16 Is that Aaron Reynolds? 17 Answer: Yes. 18 Question: Aaronr had some pretty wild 19 ideas after three or so beers. Earleh -- who 20 is Earleh? 21 Answer: Earle Horton. 22 Question: Earleh has some too. Do 23 you know what their ideas were? 24 Answer: No, I do not. 25 Question: It goes on, we need to make 13396 1 sure this doesn't distract the team for a 2 couple of reasons. 1, the pure distraction 3 factor. 2, the less people know about exactly 4 what gets done, the better. 5 Mr. Silverberg, who knows exactly what 6 got done in regards to this e-mail? 7 Answer: I have no idea. 8 Question: So you're not one of the 9 people that was privy to decisions made in 10 response to this e-mail? 11 Answer: As a result of this 12 particular e-mail, I don't know what was done, 13 if anything. 14 Question: So I take it from that you 15 wouldn't have any knowledge about what was done 16 to Windows 3.1 to see to it that it did not 17 work with DR-DOS 6.0? 18 Answer: Yes, I would not know. 19 Question: All right. Mr. Cole was 20 not the only person at Microsoft sending 21 e-mails around to you and others suggesting 22 that intentional incompatibilities be coded 23 into Windows to make sure it didn't work on 24 DR-DOS; correct? 25 Answer: I have no idea. 13397 1 Question: I'll hand you Exhibit 1723. 2 You're looking at the e-mail from Mr. Allchin 3 that begins at the bottom and continues on to 4 the next page. 5 The subject of this e-mail which you 6 first wrote and sent to Mr. Allchin and others 7 on September 27, 1991, the subject is 8 DRI/Novell/IBM. 9 Now, am I correct that it appears this 10 e-mail was sent three days prior to the e-mail 11 from David Cole that we were just looking at? 12 Answer: I don't know. I mean, what 13 was the date of Mr. Cole's? September 30th? 14 Question: September 30th. 15 Answer: Yes. 16 Question: Okay. So three days before 17 that e-mail you were writing to Brad Chase, Jim 18 Allchin and others, including Steve Ballmer and 19 Paul Maritz, about concerns about IBM 20 announcing support for DR-DOS at COMDEX; 21 correct? 22 Answer: That's what it appears so. 23 Question: You were worried about 24 that, weren't you, Mr. Silverberg? 25 Answer: Worried about that. 13398 1 What is that? 2 Question: IBM announcing support for 3 DR-DOS. 4 Answer: Yes, I was. 5 Question: Because if IBM did that, 6 you knew that other OEMs would be more likely 7 to move to DR-DOS; correct? 8 Answer: Didn't know that. I thought 9 it was a possibility. 10 Question: At the very last sentence 11 of your e-mail, DR-DOS has problems running 12 Windows today, and I assume will have more 13 problems in the future. 14 And Mr. Allchin's e-mail back to you 15 says, you should make sure it has problems in 16 the future, semicolon, dash, smile, which is 17 his way of smiling and winking at you as he 18 sends the e-mail; right? 19 Answer: I don't know. You'll have to 20 ask Mr. Allchin. 21 Question: You don't know anything 22 about e-mail sign language? 23 Answer: You'd have to ask Mr. Allchin 24 what his intention was. 25 Question: Okay. You should make sure 13399 1 it has problems in the future. 2 Did you make sure that Windows had 3 problems with DR-DOS in the future? 4 Answer: No, I did not. 5 Question: Who is Mr. Allchin? 6 Answer: Mr. Allchin, he was 7 responsible for LAN manager at the time. 8 Question: And then Windows NT? 9 Answer: Later Windows NT. 10 Question: Is he on the executive 11 staff? 12 Answer: Executive staff, yes. 13 Question: He's pretty high up in 14 Microsoft; right? 15 Answer: He's a senior vice president. 16 Question: And at this point in time, 17 September 1991, was he your peer horizontally 18 on the Microsoft organizational chart? 19 Answer: He had no responsibility for 20 any of my businesses, that's correct. 21 Question: But he was on the same 22 level as you, just overseeing other products? 23 Answer: Yes. Yes. 24 Question: Okay. So this isn't like 25 it's, you know, some low-level guy saying to 13400 1 you you should make sure it has problems in the 2 future; right? 3 Answer: Right. I was irritated by 4 his response because it insinuated intent, 5 which was not true. 6 Question: You had no intent to do 7 that? 8 Answer: That's correct. 9 Question: Well, okay. That's dated 10 September 27, 1991. 11 I want to hand you an e-mail that's 12 dated September 28, 1991. This was previously 13 marked in a deposition as Exhibit 1114. 14 We're going to be looking at the 15 e-mail 604 that begins at the bottom of the 16 page and goes over to the next page. 17 Answer: Okay. 18 Question: Okay. This is -- it's a 19 thread, e-mail exchange between you and 20 Mr. Barrett. 21 It begins -- actually, it begins the 22 previous day, September 27th, and I note that 23 it's actually a mere four hours after 24 Mr. Allchin sent his e-mail to you, if I'm 25 looking at the time imprints correctly. 13401 1 It says he sent his at 18:27 on 2 September 27, which would be 6:27. And you're 3 sending this on to Mr. Barrett at 22:44, which 4 would be 10:45 in the evening; correct? 5 Answer: That's the time. 6 Question: And you state, can you tell 7 me specifically what we're going to do to bind 8 ourselves closer to MS-DOS? 9 Since you haven't been replying to my 10 messages, I don't know how to interpret your 11 silence. 12 Let me emphasize the importance; IBM 13 is going to announce the DR-DOS deal at COMDEX 14 (almost 100 percent certain). Okay? 15 Is it your testimony that this mail to 16 Mr. Barrett had nothing to do with 17 Mr. Allchin's e-mail to you four hours 18 previously? 19 Answer: Yeah. 20 Question: Mr. Barrett states, sorry 21 for the silence -- don't interpret it as 22 ignoring you. The approach that Ralph and I 23 have discussed is to use a VxD to extend DOS by 24 patching it. 25 In this case, we would create a 13402 1 subfunction in the findfirst/findnext family -- 2 findabunch to allow file manager to make a 3 single call to get directory information. 4 We would not patch unknown OSs and, 5 most likely, would only patch MS-DOS 5.X. the 6 big advantage here is that it provides a 7 legitimate performance improvement. 8 However, it won't prevent us from 9 running on foreign OSs (unless we explicitly 10 decide to refuse to run) -- they just won't run 11 as fast. 12 Did I read that correctly? 13 Answer: You've read what's written 14 here, yes. 15 Question: And if I recall correctly, 16 Mr. Constant's request to be on the beta site 17 specifically referred to a need to modify the 18 VxD. 19 Do you recall that? 20 Answer: The VxD? There's not the 21 VxD. 22 Question: No -- 23 Answer: It's completely unrelated to 24 whatever this may be discussing. 25 Question: So the fact that in Exhibit 13403 1 1720 that John Constant is asking to be a beta 2 site because of their need to modify the load 3 high VxD, that's unrelated to what's being 4 proposed here by Mr. Barrett? 5 Answer: Yes. 6 Question: And then continuing on in 7 Mr. Barrett's e-mail on the next page, that 8 paragraph, is this the approach you want to 9 take? Or would you prefer a simple check and 10 refuse to run? That's a lot easier, but 11 clearly quite defeatable. I'll come and talk 12 to you about it. 13 Did you prefer a simple check and 14 refuse to run? 15 Answer: No, I did not. 16 Question: You said to him in response 17 to this, let's talk. What did you all talk 18 about? 19 Answer: I don't recall. 20 Question: You don't recall? 21 Answer: No. 22 Question: But -- 23 Answer: I mean, my general point of 24 view at the time was anything -- Windows 3.1 25 depended very deeply and subtlely on MS-DOS. 13404 1 Anything that we could do to provide a 2 better Windows to customers to increase 3 performance, additional capabilities, increase 4 robustness, it was good. 5 And I was asking him to explore ways 6 that we could -- by exploiting other aspects of 7 MS-DOS were the ways that we could deliver 8 customer benefit. And his response was there 9 was a way that we could provide customer 10 benefit including increased -- 11 Question: You're saying that this 12 exchange between you and Mr. Barrett is about 13 giving customers benefit as opposed to trying 14 to figure out some way to hinder DR-DOS? 15 Answer: Yes. And the work that 16 Mr. Barrett was proposing was never done. 17 Question: I want you to look at your 18 e-mail which began this thread. And it says 19 subject, DR. Is that Digital Research? 20 Answer: Digital Research, yes. 21 Question: This is being written in 22 the context of Digital Research; correct? 23 Answer: No. I was telling you that 24 we were thinking about however we could improve 25 the performance or provide additional user 13405 1 benefit for customers, if that meant depending 2 on Windows, that's fine. 3 And I wanted to be able to tell 4 customers that if you use MS-DOS with Windows, 5 there are certain advantages. 6 You can take full advantage of the 7 underlying MS-DOS to provide additional user 8 capabilities and use additional user benefits. 9 Question: So it would be subject DR, 10 which is short for Digital Research, and that 11 was your shorthand way of saying, let's provide 12 customers benefit in our development; right? 13 Answer: I'm just telling you what our 14 objectives were, to provide customer benefit 15 for users of Windows. 16 Question: Okay. Even as late as a 17 month later at the end of October 1991, you 18 knew that DR-DOS was working on top of Windows 19 3.1 as it then existed in beta; right? 20 Answer: No. We had many reports from 21 people that it wasn't working. 22 Question: But as far as people within 23 Microsoft working on it, working with DR-DOS in 24 3.1, the conclusion was that DR-DOS was still 25 working with Windows 3.1; right? 13406 1 Answer: No. I just answered that 2 question. 3 Question: I'll hand you Exhibit 17 -- 4 no, I'm sorry. I'll do it again. 5 This is Exhibit 970. This was marked 6 in Mr. Freedman's deposition. And we're going 7 to look at the first two e-mails at the top of 8 the page. The first one is unnumbered, and 9 then the second one. 10 Just go ahead and take a look at this. 11 Answer: I'm sorry, which one are you 12 looking at? 13 Question: The first e-mail, which it 14 doesn't have a number at the top, and then the 15 one following it. Those are the two that I'm 16 interested in. 17 Answer: Okay. 18 Question: All right. You write, on 19 October 29th, 1991, to David Cole and Phil 20 Barrett, subject, DR and Win 3.1, looks like 21 DR-DOS works with Windows 3.1. 22 That's in response to an e-mail from 23 Richard Fade to you and Mr. Chase; correct? 24 Answer: No, that's not correct. 25 Question: Okay. Not Richard Fade, 13407 1 Richard Freedman? 2 Answer: Yes, Richard Freedman. 3 Question: Okay. His last sentence 4 is, in short, I haven't seen any basic kernel 5 incompatibilities. 6 Do you have any basis to dispute that 7 statement? 8 Answer: Yes. 9 Question: You do? 10 Answer: Yes. 11 Question: How do you have a basis to 12 dispute that? Were you testing DR-DOS 6.0 at 13 the time? 14 Answer: No. I had received mail from 15 product support people saying that they had 16 received phone calls from people who had beta 17 test copies of Windows 3.1 that were 18 encountering incompatibilities with DR-DOS. 19 Question: Actually, it just depended 20 on which version of Windows 3.1 beta we're 21 talking about, doesn't it, Mr. Silverberg? 22 Answer: I don't know. 23 Question: Well, you know that some 24 betas worked with DR-DOS 6.0 and you knew that 25 others didn't; right? 13408 1 Answer: No, no. Why do you insist in 2 putting words in my mouth? 3 Question: Well, because in the next 4 e-mail you state, which version of Windows 3.1. 5 Answer: Yes. 6 Question: Why would you be asking him 7 which version of 3.1 if you thought one would 8 work and one would not? 9 Answer: I don't know. 10 Question: Just for -- 11 Answer: Just curious. 12 Question: Just curious, okay. 13 Answer: Those e-mails from PSS 14 predated this mail. 15 Question: Do you recall specific PSS 16 e-mails just sitting here out of the blue; 17 those are documents that you recall even though 18 you haven't recalled a lot of other documents 19 here? 20 Answer: I was shown some documents 21 yesterday by counsel and saw that document, 22 yes. 23 Question: Okay. Is there anything 24 else out of the blue that you recall that you 25 want to share with us right now? 13409 1 Anything? 2 Answer: No. 3 Question: Okay. Do you want to share 4 anything about the blue moon? What was the 5 blue moon plan? 6 Answer: The blue moon plan? I 7 thought that it was a joke. 8 Question: No, no. 9 Answer: I don't know. 10 Question: Let me hand you what's been 11 marked as Exhibit 1725, subject, blue moon 12 plan. It is an e-mail from you to Brad Chase 13 and others on October 16, 1991. 14 Go ahead and review this and then 15 perhaps it refreshes your recollection what the 16 blue moon plan was. 17 Answer: I just read it. 18 Question: Yeah. Well, you wrote it, 19 too, didn't you? 20 Answer: Apparently. 21 Question: Subject. Blue moon plan. 22 Answer: Eight years ago. No, seven 23 years ago. 24 Question: No recall of what that was? 25 Answer: No. I still don't recall or 13410 1 know what blue moon is. 2 Question: Mr. Freedman didn't 3 remember what this was either. 4 Fourth paragraph, we think IBM is 5 going to announce support for DR-DOS at COMDEX 6 (in just over two weeks.) It may happen at 7 COMDEX, it may happen in January. But I am 8 quite certain it will happen. 9 So you really saw this as an extreme 10 potentiality that IBM would announce support 11 for DR-DOS; right? 12 Answer: We felt it was, yes. 13 Question: Do you remember what the 14 AARD code was? 15 Answer: I know what the term is. 16 Question: I mean, you've talked with 17 Mr. Schulman about it and it was a big ruckus 18 in the press several years ago. 19 I mean, when I talk about the AARD 20 code, do you know what that is or do we have to 21 -- 22 Answer: In general. I don't know 23 technically what it was. 24 Question: Something that Aaron 25 Reynolds wrote to detect MS-DOS in Windows 3.1; 13411 1 right? 2 Answer: In a beta. That was in a 3 beta release of MS-DOS. 4 Question: Well, it was in the final 5 version. It just didn't -- it had a byte 6 removed or a bit removed so that it wouldn't 7 display the message; correct? 8 Answer: No. My understanding is it 9 was disabled. 10 Question: Right. Code was still 11 there. It was just disabled; right? 12 Answer: I don't know. That's what 13 I'm told. I don't know if that's the case or 14 not. All I know was whatever effect it may 15 have had was no longer there. 16 Question: What's the CompuServe forum 17 used for in regards to the beta test cycle? 18 Answer: Windows 3.1? It was used for 19 a number of things. 20 Question: What? 21 Answer: Bug reporting, conversation. 22 Question: Was it something that the 23 beta users could log on and send mail and 24 review other mail that had been sent? 25 Answer: It was a bulletin board 13412 1 system. 2 Question: I just want to be clear. 3 When a user gets on, would all the 4 other users be able to see what was being 5 discussed by them? 6 Answer: Not necessarily. 7 Question: Sometimes, yes; sometimes, 8 no? 9 Answer: Sometimes, yes; sometimes, 10 no. 11 Question: Okay. Do you recall 12 putting a message on the CompuServe forum 13 during the Windows 3.1 beta test? 14 I mean, were you personally on it and 15 monitoring it? Do you recall that? 16 Answer: I was personally on the forum 17 at times, yes. 18 I wouldn't say I was monitoring every 19 message or every issue that came up, but I was 20 personally involved, yes. 21 Question: Let me hand you what's been 22 marked as Exhibit 1726, which is a lengthy 23 e-mail thread, the beginning of which says -- 24 well, the subject is CompuServe feedback, and 25 it's a message from you. 13413 1 And it says, I placed the following 2 message on CompuServe yesterday. Attached are 3 the responses I got so far. 4 Do you recall doing this, putting the 5 message on and then gathering responses to 6 share with some other people? 7 Answer: No, I do not. 8 Question: Is that your handwriting at 9 the top right corner, it says Win 3.1 beta? 10 Answer: I think so. 11 Question: Just to be clear on the 12 context, this appears to me to be a series of 13 e-mails from the CompuServe forum that have 14 been gathered and sent by you to some others in 15 the corporation. 16 I don't have questions about all of 17 the e-mails that are gathered. I just have a 18 question about one of them. 19 Answer: Okay. 20 Question: It's titled DR-DOS 21 problems, reply to DR-DOS problems; right? 22 Answer: Yes. 23 Question: Down on the fourth 24 paragraph Mr. Curtis has written, there are 25 other issues to be placed out in the open, 13414 1 though. 2 While not working with DR is one 3 story, disabling Windows only because it is 4 installed on a DR-DOS machine is another issue. 5 Has MS publicly stated that they were 6 going to tweak the code to prevent it to work 7 with DR-DOS? 8 I ask because someone said in the beta 9 forum that once they got past setup, they could 10 use DR-DOS 6. (However, I do not have 11 confirmation of this from many other users.) 12 Did I read that correctly? 13 Answer: I got lost during the middle 14 of that, so -- 15 Question: I'll just read it again. 16 There are other issues to be placed 17 out in the open, though. 18 While not working with DR is one 19 story, disabling Windows only because it is 20 installed on a DR-DOS machine is another issue. 21 Has MS publicly stated that they are 22 going to tweak the code to prevent it to work 23 with DR-DOS? 24 I ask because someone said in the beta 25 forum that once they got past setup, they could 13415 1 use DR-DOS 6. (However, I do not have 2 confirmation of this from many other users.) 3 Okay? 4 Answer: Okay. 5 Question: Now, there's a reply from 6 you on the next page. You reply obviously to 7 his whole e-mail, but your first sentence is, 8 there is no code in Windows to detect DR-DOS. 9 And I take it you say that that is a 10 true statement? 11 Answer: That is a true statement. 12 Question: You tell him there's no 13 code in Windows to detect DR-DOS; right? 14 Answer: That's correct. 15 Question: Why didn't you also tell 16 him that there was code to detect MS-DOS? 17 Answer: Because we put the code in 18 that Christmas beta so that we could determine 19 whether we were detecting MS-DOS properly or 20 not. 21 It makes no sense to tell people 22 that's what it's there for because we wanted to 23 be able to determine whether that code was 24 accurate or not. 25 The message said call Microsoft 13416 1 technical support so then we could determine 2 whether somebody was using MS-DOS or not and 3 determining whether our code had false 4 positives or not. 5 Question: But why were you telling 6 him that there's no code in Windows to detect 7 DR-DOS -- 8 Answer: Because we didn't do anything 9 to -- how did he put it? Let me use his words. 10 We didn't do anything which tweaked 11 Windows to prevent it from working with DR-DOS. 12 We didn't. We did nothing to tweak the code to 13 prevent it from working with DR-DOS. 14 DR-DOS claimed it was 100 percent 15 compatible with MS-DOS. If it did, it would 16 just work. 17 Question: Okay. And you don't 18 believe that simply replying to him stating 19 that there's no code in Windows to detect 20 DR-DOS, that that was perhaps misleading? 21 Answer: It's completely factual. 22 Question: Okay. And it was not your 23 intent to mislead him or the other users of the 24 CompuServe forum; correct? 25 Answer: That's correct. It was to 13417 1 tell him we are not doing anything that detects 2 DR-DOS and tweaks it to make sure Windows is 3 incompatible with it. We didn't do anything. 4 Question: Okay. Now, after the AARD 5 code shipped in the Christmas beta, as you've 6 just testified; right? 7 Answer: Yes. 8 Question: And that meant when Windows 9 3.1, that beta was trying to set up over DR-DOS 10 at various points, it would stop and a message 11 saying nonfatal error would appear. 12 Do you recall that? 13 Answer: I don't know when that error 14 occurred. You said when it sets up. I don't 15 know if it occurred during setup or at some 16 other period of time. 17 Question: It would display nonfatal 18 error whether it was on setup or some other 19 point during the -- 20 Answer: Perhaps if we detected MS-DOS 21 correctly. If we didn't detect MS-DOS, the 22 plan was to have that message be displayed. 23 Question: Okay. And at this point, 24 December 1991, Novell had finished the 25 acquisition and merger with DRI; correct? 13418 1 Answer: I don't know. 2 Question: Okay. Do you recall that 3 after the Christmas beta shipped, that Novell 4 sent you a request to be a beta site to ensure 5 that DR-DOS worked with Windows 3.1? 6 Answer: Just vaguely. 7 Question: Let me hand you what's been 8 marked as Exhibit 1727. And it's the e-mail 9 that begins at the bottom of the page from Phil 10 Barrett, and he's replying to an e-mail from 11 you that's on the next page. 12 Answer: Okay. 13 Question: Okay. And in the e-mail 14 that you sent to him and some others, you're 15 forwarding a proposal from Novell related to 16 Novell's efforts to make DR-DOS compatible with 17 all current and future versions of Microsoft 18 Windows 3.1 and Windows NT; correct? 19 Answer: That's what it appears. 20 Question: Okay. What was 21 Mr. Barrett's reply to you? 22 Can you read that, please? 23 Answer: And I thought them Utah folks 24 were drug free. 25 Question: By that, I take it 13419 1 Microsoft wasn't about to help Novell make sure 2 DR-DOS was compatible with Windows 3.1 and 3 Windows NT? 4 Answer: Microsoft was not going to 5 help an operating system competitor compete 6 with Microsoft. 7 Question: And Novell would have to be 8 on drugs to think otherwise; right? 9 Answer: Novell would have to think -- 10 yeah, well, we had turned down Digital 11 Research's requests numerous times to have us 12 help them compete against us. 13 We thought they would -- we found it 14 was a little humorous. You'd have to ask 15 Mr. Barrett, his interpretation. 16 I found it humorous that Novell would 17 expect us to help them compete against us, 18 including licensing them MS-DOS source code 19 that they can incorporate in DR-DOS. 20 It is a fairly humorous notion that 21 Microsoft would give intellectual property, 22 including source code, of its product to a 23 competitor to then be used against you. 24 I don't recall Pepsi, you know, Coke 25 giving the secret formula to -- Coca-Cola to 13420 1 Pepsi. 2 Question: Of course, Pepsi and Coke 3 compete head-to-head as to that carbonated 4 beverage, don't they, Mr. Silverberg? 5 Answer: I'm sorry? 6 Question: Pepsi and Coke compete 7 head-to-head on the caffeinated carbonated 8 beverage that you just referred to, don't they? 9 Answer: They are competitors in the 10 beverage business. Microsoft and Novell, and 11 Microsoft and Digital Research were competitors 12 in the operating system business. 13 Question: But as we established 14 earlier, Novell at this point wasn't on the 15 beta blacklist, were they, prior to that? 16 Answer: We didn't establish that. 17 Question: I thought we looked at the 18 beta blacklist. 19 Should we look at it again, from July 20 1991? 21 Okay. Prior to them buying DRI, they 22 weren't on the beta blacklist, were they? 23 Answer: I didn't see it there. 24 Question: And Microsoft competed in 25 the networking business against Novell at that 13421 1 point, didn't they? 2 Answer: And I don't believe Novell 3 received beta copies of LAN manager, nor did we 4 receive beta copies of NetWare. 5 Question: Good point. Okay. If 6 that's your point -- 7 Answer: Did they? 8 Question: You were competing -- 9 Answer: And we didn't exchange betas. 10 Question: Back to the AARD code and 11 the error message that would pop up saying 12 nonfatal error. 13 What was that supposed to get the user 14 to do when they saw it? 15 Answer: Supposed to call Microsoft 16 technical support. 17 Question: Why? 18 Answer: I testified to that earlier. 19 Question: I must have missed it, 20 then. I'm sorry. 21 Why? Why would you want them to call 22 technical support? 23 Answer: So we could verify whether 24 our MS-DOS detection code was working properly 25 or not. 13422 1 And we were concerned that we might 2 misdetect MS-DOS and tell a user you weren't 3 using MS-DOS when, in fact, they were. 4 Question: What was the whole reason 5 -- 6 Answer: It was a very difficult code 7 to test and debug, so we wanted people who saw 8 that message to call us so that we could follow 9 up and determine whether that code was working 10 properly or not. 11 Question: What was this whole 12 exercise testing the AARD code for? 13 I mean, you were getting ready to 14 display some sort of message to the user if 15 they weren't running on MS-DOS? 16 Answer: PSS was very, very concerned 17 that they were unable to support Windows 3.1 18 running on something other than MS-DOS. 19 And so they strongly urged us to put a 20 message that would warn the user, at least 21 inform the user that Microsoft had built 22 Windows 3.1 for MS-DOS, only tested on MS-DOS, 23 and you should be aware of that. 24 We thought we would do it because if 25 there were problems, they could have data loss 13423 1 errors. We felt it was a responsible and fair 2 thing to do to let customers know that they 3 were using Windows on an untested, unsupported 4 product. 5 Question: So this was only from the 6 standpoint of a suggestion from product support 7 to help customers? It had nothing to do with 8 trying to scare them off of DR-DOS? 9 Answer: Yes, yes. The suggestion 10 came from product support that went to Mr. 11 Ballmer who then said we should put it in. 12 (Whereupon, playing of the video 13 adjourned.) 14 THE COURT: At this time we are going 15 to recess at this time. 16 I'm going to read the admonition. 17 Under your oath as jurors in this 18 case, you are admonished it is your duty not to 19 permit any person to speak with you on any 20 subject connected with this trial of this case. 21 You are not to talk to any of the 22 parties, their attorneys, or witnesses during 23 the trial even upon matters wholly unrelated to 24 this trial. 25 Should anyone try to discuss this case 13424 1 with you or in your presence, you should not 2 listen to such conversation. You should 3 immediately walk away. 4 If a person should persist in talking 5 to you, try to find out their name and report 6 it immediately to the Court. 7 You also are admonished not to 8 converse among yourselves or with anyone, 9 including family members, on any subject 10 connected with the trial of this case. 11 You should not form or express an 12 opinion on this case. And you should keep an 13 open mind until you have heard all of the 14 evidence, the statements and arguments of 15 counsel, the instructions of the Court and the 16 case is finally submitted to you and you have 17 retired to your jury room to deliberate. 18 Not only must your conduct as jurors 19 be above reproach, but you must avoid the 20 appearance of any improper conduct. 21 You must avoid reading, listening to, 22 or watching news accounts of this trial, and 23 you should avoid looking at any Internet or 24 websites concerning this trial or any subject 25 matter about it. 13425 1 Sometimes such accounts are based upon 2 incomplete information or contain matters which 3 would not be admissible in court and could 4 unduly influence your ultimate decision. 5 You may -- as a jury, you are the 6 judge of the facts, while the Court is the 7 judge of the law. 8 During the course of this trial, I 9 will be required to decide legal questions. 10 And before you leave to deliberate this case, 11 the Court will instruct you on the law you are 12 to follow in reaching your verdict. 13 You should give careful attention to 14 all of the testimony as it is presented to you, 15 for you will only hear it once and you must 16 depend upon your recollection of the testimony 17 when deliberating in your jury room. 18 But, as stated before, do not form an 19 opinion and keep an open mind until all of the 20 evidence has been received. 21 From time to time during the trial, 22 the Court will be required to confer with the 23 attorneys upon points of law that require only 24 the consideration of the Court. 25 These conferences will be conducted 13426 1 outside the presence of the jury. It is 2 impossible to predict when these conferences 3 will be required or how long they may last. 4 However, these conferences will be 5 conducted so as to consume as little of your 6 time as possible while still being consistent 7 with the orderly progress of the trial. 8 Also, from time to time during the 9 trial, the Court will be required to rule on 10 objections or motions of the lawyers. 11 You should not infer anything by 12 reason of the objection, nor may you infer 13 anything from the rulings on the objections or 14 that the Court has any opinion one way or the 15 other concerning the merits of the case. 16 If an objection to a question of a 17 witness is made and the objection is sustained 18 and the witness is not permitted to answer, you 19 should not speculate on what the answer may 20 have been nor may you draw any inference from 21 the question itself. 22 Additionally, in your jury room, you 23 must not refer to or give consideration to any 24 testimony which may have been given, but then 25 was stricken from the record by the Court. 13427 1 Also, the lawyers in this case are 2 under an obligation not to talk with you. Do 3 not consider them to be aloof if they do not 4 greet you outside of the courtroom. They are 5 merely abiding by their own rules of ethics and 6 the rules of the Court. 7 You can leave your notebooks here. 8 Have a great weekend. Please drive carefully. 9 See you at 8:30 a.m. Monday morning. 10 All rise. 11 (The following record was made out of 12 the presence of the jury at 3:09 p.m.) 13 THE COURT: Very well. The matter 14 before the Court at this time is an issue 15 regarding the displaying of exhibits that 16 Defendant believes are confidential and contain 17 trade secrets; is that correct? 18 MR. JONES: That's correct, Your 19 Honor. Microsoft's motion. 20 THE COURT: You may proceed. 21 MR. JONES: Thank you, Your Honor. 22 Your Honor, what Microsoft seeks to do 23 in its motion is to maintain the status quo. 24 These are materials that have been 25 designated as confidential pursuant to the 13428 1 protective order applicable in this case. And 2 they have been -- they have had confidential 3 status for years ever since their production. 4 So we are not asking for a new status 5 to be granted to these what is now 50 6 confidential documents. We are simply asking 7 that the status quo be maintained. 8 Plaintiffs have never before 9 challenged the confidentiality designation on 10 these documents. As indicated, when they were 11 produced, they were marked confidential. 12 Pursuant to the protective order, they could 13 have. They could have challenged that 14 designation, and they did not. 15 Now, I'm not saying that they have run 16 out of time, but I am saying that they have 17 never before had reason to question the 18 confidentiality designation that Microsoft put 19 on these documents. 20 Now they've come and told the Court 21 that documents that have never been shown to 22 the Jury, that have played no role in this 23 trial, that Plaintiffs sought to have admitted 24 with 3,800 other documents, that now that 25 confidentiality designation should be lifted. 13429 1 They have really provided the Court 2 with no basis with regard to policy and no 3 basis pertaining to the documents themselves 4 requiring that these documents now be stripped 5 of their confidentiality designation and made 6 available to the press. 7 I think it's also important to 8 recognize here that we're talking about a very 9 small subset. Plaintiffs, again, moved to 10 admit about 3,189 documents. I think I 11 misspoke. I might have said 3,800. It was 12 3,189 documents. 13 We're talking now about 50 documents 14 out of that set. Less than 2 percent. And 15 we're talking again, as I indicated, a 16 confidentiality designation that Microsoft has 17 maintained since the day these documents were 18 produced. 19 And it is worth repeating that these 20 are documents that haven't been used in any 21 deposition designation that has been played or 22 that will be played in this court. They 23 haven't been used with any live witness to 24 date. 25 These are documents that are simply 13430 1 admitted to be sure, but have had no role in 2 the Jury's determination or deliberation and 3 consideration of this case. 4 We are in agreement with Plaintiffs 5 that the standard here is provided by Iowa code 6 22.7(3). 7 The Court's January, I believe it was 8 7 order, so provided and recognized, qualified 9 the right to public access of documents 10 admitted en masse, qualified that right by 11 saying that parties could raise confidentiality 12 or could seek protection of confidential 13 documents and cited Section 22.7(3) and Sub 25 14 of the Code of Iowa. 15 Sub 3 is the provision that we are 16 seeking or that we are proceeding under. 17 I note that because Plaintiffs make an 18 argument in their brief about 22.8, I believe. 19 The Court can disregard that argument. That 20 simply is a straw man they've created. It sets 21 forth confidentiality requirements under a 22 different standard. We're proceeding under 23 22.7(3). 24 And I think both parties agree that 25 there is an Iowa Supreme Court decision that 13431 1 provides that rule of decision for the Court. 2 It's the U.S. West case. And if the 3 Court would like, I can hand up a copy. 4 THE COURT: Thank you. 5 Thank you, sir. 6 MR. JONES: Yes. 7 U.S. West does, as I indicated, 8 provide the rule of decision here. We quoted 9 from it extensively in our brief. 10 And I'm going to rely and emphasize 11 that the points that the Court made there bear 12 emphasis for this Court in its consideration of 13 whether to maintain the confidentiality status 14 that these documents have long held. 15 U.S. West says that under 22.7(3) 16 trade secrets are not part or can be exempted 17 from disclosure under the Iowa public -- or 18 public records law. 19 Trade secrets are, then, the Court 20 instructs us, are defined under the Uniform 21 Trade Secrets Act under Section 550.2(4). 22 And the Court then borrows that 23 definition from the Trade Secrets Act. And 24 then in flushing it out, the Court says, 25 information kept secret that would be useful to 13432 1 a competitor and require cost, time, and effort 2 to duplicate is of economic value and is, 3 therefore, capable of being -- or is, 4 therefore, qualified as a trade secret. 5 The Court further explains that we 6 believe that a broad range of business data and 7 facts which, if kept secret, provide the holder 8 with an economic advantage over competitors or 9 others qualify as trade secrets. 10 So the parties have said different 11 things about whether this is to be narrowly 12 interpreted or broadly interpreted. 13 The Iowa Supreme Court makes clear the 14 broad category of documents can satisfy -- can 15 fall within the trade secrets category. 16 And it further indicates that what 17 you're looking for is whether these documents, 18 whether these materials provide a competitive 19 advantage for Microsoft. 20 That's the rule of decision here. 21 Now, we have provided the Court not 22 just an affidavit, but we have provided the 23 documents themselves under seal. And those 24 documents on their face showed that the 25 information contained within them all pertain 13433 1 to Microsoft products that are on the market, 2 and all of these documents have indications of 3 confidentiality on them. 4 The affidavit that we provided the 5 Court further confirms that these documents had 6 been kept secret by Microsoft and provides 7 detail of why the documents would provide a 8 competitive disadvantage or an advantage to 9 competitors if they had been released. 10 So we have satisfied the requirements 11 as set forth under U.S. West. We have provided 12 it in sworn testimony from a Microsoft official 13 for each of the 50 documents for which we're 14 seeking confidentiality status. 15 We're actually seeking to maintain 16 confidential status. Those records have been 17 kept secret. They always have been kept 18 secret. And providing them to the public would 19 provide commercial disadvantage to Microsoft. 20 And that's plain from the documents themselves. 21 Now, I want to -- U.S. West, to be 22 sure, found in that case that confidential 23 status or that business record status -- I'm 24 sorry, business records -- trade secret status 25 couldn't apply to the documents at issue there. 13434 1 But I think it's important to consider why. 2 And in U.S. West, the Court -- the 3 situation there was that U.S. West had 4 allegedly engaged in some sort of real estate, 5 frankly, shenanigans, and a reporter was doing 6 some investigation of them. 7 U.S. West had provided some leases to 8 a public utility that was making some decisions 9 about rate making involving U.S. West. 10 The newspaper sought the documents, 11 the leases from the rate making entity. U.S. 12 West intervened and opposed. And U.S. West 13 said, look at, you know, these are documents 14 that, if released, would provide competitive 15 advantage. 16 The Court said no, and here's why. 17 The Court said that these documents were not 18 like arm's length transaction leases. These 19 were sort of intracorporate leases and so they 20 would be irrelevant from a competitor's 21 standpoint. These were not documents that 22 involved any actions of U.S. West with its 23 competitors or in the open commercial market. 24 What it was were internal, internal 25 sort of transactions that were alleged by the 13435 1 press were used to cook the financial books. 2 So we see a couple of things. 3 One, the information really didn't 4 pertain to the competitors and so couldn't 5 provide competitive advantage. 6 But, second, there was a strong public 7 interest that obviously affects the Court's 8 decision in release of the documents. 9 These were documents that were before 10 a government decision-making body, were going 11 to affect a government decision. And so the 12 public does have not an absolute certainty but 13 does have a heightened right to know 14 information that is going to be considered by a 15 government decision-maker. 16 And that's a key distinction between 17 -- or that's a key distinction between the 18 documents at issue in U.S. West and the 19 documents here. 20 Because, again, these documents have 21 not been shown to the Jury. They at this point 22 are not part of the deliberate process. 23 There is no real public interest in 24 documents that have not been made a part of the 25 jury's consideration in this matter yet. 13436 1 What matters, what matters is what 2 goes before the Jury. That's what they are 3 going to base their decision on. That's what 4 is an appropriate subject for sort of closer 5 scrutiny and consideration as to whether the 6 trade secret status should apply. 7 But here, these are simply documents 8 with some relevance as claimed by Plaintiffs to 9 the action that have been admitted, but have 10 had no role at all in this case up to this 11 point. 12 So, again, what we ask for, Your 13 Honor, is that the Court recognize that and 14 maintain the trade secret status of 50 15 documents, 50 documents. A trade secret status 16 that we've justified by affidavit and it's 17 clear from the documents themselves. 18 The documents would show they involve 19 information regarding Microsoft competitors or 20 pricing information, information that falls 21 squarely within what the Court in U.S. West 22 says constitutes trade secret information. 23 THE COURT: Anything else, sir? 24 MR. JONES: Not at this time. 25 THE COURT: Mr. Cashman or Mr. West? 13437 1 MR. CASHMAN: Thank you, Your Honor. 2 I did want to introduce my colleague, 3 Dan West. I'm not sure that he's been in court 4 before. 5 THE COURT: Once. 6 MR. WEST: Just once. 7 THE COURT: He sat, but didn't 8 participate. 9 MR. CASHMAN: Okay. First of all, I 10 just want to -- I think the right place to 11 start here with respect to these exhibits is a 12 little bit of timeline. 13 The Court will recall that the 14 Plaintiffs moved for admission of these and 15 other documents for the first time on December 16 15th, 2006. 17 Microsoft said it wanted an 18 opportunity to review those documents, which it 19 did over the holiday break, up through early 20 January. 21 In the meantime, the Court issued its 22 order on January 8th stating that all documents 23 which were admitted in evidence were going to 24 be public. 25 So Microsoft certainly knew throughout 13438 1 its review process that it would be an issue 2 about whether these materials should be 3 designated confidential. 4 That becomes relevant because when 5 Microsoft started providing its position on 6 these documents, starting on January 10th, Your 7 Honor, Microsoft failed to identify any of 8 these documents as documents it wished to 9 maintain confidential status. 10 Didn't identify a single document as 11 one they thought should maintain confidential 12 status. 13 Then these documents were admitted on 14 the 16th of January into evidence. And that 15 was because no objections had been asserted 16 against any of them and none of them had been 17 designated as confidential in spite of the 18 January 8th order issued by the Court. 19 At the last minute, Microsoft -- and 20 by the last minute, I mean just before the 21 three days expired after their admission, as -- 22 that was the time frame that the Court 23 identified in his January 8th order for 24 Microsoft to -- or any party to claim 25 confidential status, Microsoft put in a bare 13439 1 bones memorandum alleging confidential status 2 for 55 documents. 3 And the Court has a copy of 4 Microsoft's motion which is, as we've argued 5 before, blatantly deficient on its face. 6 And while Microsoft filed that motion 7 within the three-day time frame, Plaintiffs 8 continue to submit that at that time Microsoft 9 failed to meet its burden both under the court 10 order and under the law. They didn't supply 11 one shred of evidence in support of their 12 claim. 13 Instead, they just listed the 14 documents and made the conclusory statement 15 that they were confidential. 16 That doesn't satisfy the Court's 17 order. It doesn't satisfy the law. And 18 there's no excuse for Microsoft's failure, 19 given the fact that these exhibits were at 20 issue from December 15th and Microsoft knew 21 that it would be an issue certainly no later 22 than January 8th that confidential status would 23 be in play. 24 So on that basis alone, Plaintiffs 25 submit that these exhibits should all be 13440 1 released into the public record. 2 Now, moving on, Your Honor, to the 3 trade secret claims themselves, I think that 4 Mr. Jones glossed over some of the particulars. 5 And to help us through that, again, I've 6 prepared a few slides. 7 And, Darin, if you'd put up slide one 8 and two, if you can put them both up. 9 One at a time. 10 We aren't really here to talk about 11 whether these are public records because it's 12 clear they are public records unless they're 13 given trade secret status. 14 And the parties agree that the 15 applicable statutes in the Iowa Code is 16 550.2(4), which identifies trade secret. 17 And, importantly, the two subdivisions 18 under Sub 4 identify what has to be established 19 to qualify something for trade secret status; 20 namely, A, derives independent economic value, 21 actual or potential, from not being generally 22 known to, and not being readily ascertainable 23 by proper means by a person able to obtain 24 economic value from its disclosure or use; and, 25 B, is the subject of efforts that are 13441 1 reasonable under the circumstances to maintain 2 its secrecy. 3 Darin, slide 2, please. 4 The Iowa Practice Guide, Your Honor, 5 in analyzing the cases that have been handed 6 down under 550.2(4) identifies, at least as it 7 relates to our case, the elements that 8 Microsoft must establish for the contents of 9 each of these 55, or now 50 exhibits. 10 It's got to prove that the information 11 in the document is a secret. It has to prove 12 that the information has current economic 13 value, such that it would sustain competitive 14 disadvantage or a competitor would obtain 15 competitive advantage if disclosed. 16 And then, 3, Microsoft must prove it 17 has made reasonable efforts to maintain 18 confidentiality. 19 Now, let's turn to slide 3, please. 20 Mr. Jones mentioned that Microsoft 21 agrees the U.S. West case is the pertinent case 22 here, but he's glossed over probably the most 23 important aspect of the U.S. West case, which 24 sets forth the burden that Microsoft has to 25 meet on each of those elements that we 13442 1 discussed just a moment ago. 2 So for each element, Microsoft has to 3 provide evidence containing hard facts. Hard 4 facts was a direct quote from the U.S. West 5 case, the Iowa Supreme Court. 6 And in the U.S. West case, Mr. Jones 7 neglected to tell the Court that there was a 8 hearing -- there was a hearing on whether these 9 were trade secrets. 10 And, in fact, U.S. West employees 11 testified, exhibits were submitted, and U.S. 12 West employees also supplied affidavits. 13 And the Court rejected that evidence 14 as stated, quote, while affidavits and 15 testimony provided by West and its subsidiary 16 employees provide opinions concerning the 17 deleterious effects disclosure will have on 18 West or its affiliates, such evidence -- and 19 you can see here we've flecked this out a 20 little bit -- is insufficient to establish 21 economic value under the Iowa trade secret 22 statute because it is self-serving and does not 23 contain hard facts, close quote. 24 That's the U.S. West case, 498 N.W. 2d 25 711, the jump is 715. That's Iowa Supreme 13443 1 Court 1993. 2 And that statement by the Court goes 3 hand in hand where the U.S. West case started 4 out when it pointed out Iowa public record law 5 imposes, quote, a presumption in favor of 6 disclosure and gives narrow interpretation to a 7 -- that should be statutory exemptions from 8 disclosure. 9 And that's jump cite at 713 in the 10 U.S. West case. 11 So, clearly, any exceptions to 12 disclosure are to be very narrowly construed. 13 Microsoft has a substantial burden of what kind 14 of evidence it has to supply. And it has to 15 supply that proof on three elements. 16 And in that connection, Your Honor, 17 I've prepared a rulings chart for your 18 convenience. 19 If I may approach? 20 THE COURT: Yes. Hang on one minute. 21 I've got to look for something. 22 Excuse me just one second. 23 Did you file -- Defendant file any 24 other motion besides the one on January 18? 25 MR. JONES: We filed the January 18 13444 1 motion. We filed an affidavit, I believe, two 2 days ago. And we filed a reply brief 3 yesterday, Your Honor, February 8th. I think 4 it was due technically today, but we wanted to 5 give Plaintiffs a chance to read it before the 6 hearing. 7 MR. CASHMAN: I have a copy, Your 8 Honor, of those pleadings if you'd like it. 9 THE COURT: Okay. 10 Do you have copies? 11 MR. JONES: Of the affidavit and the 12 brief, Your Honor? 13 THE COURT: Yeah. 14 MR. JONES: I believe so. 15 THE COURT: If not, give it to Carrie 16 and she'll make a copy for you. 17 MR. JONES: Very well. 18 This is the affidavit, counsel. 19 MR. CASHMAN: We don't need another 20 copy. Unless it's been changed. 21 MR. JONES: Would I do that to you, 22 Mr. Cashman? 23 THE COURT: You rewrote it. 24 And I got your resistance; right? 25 MR. CASHMAN: Pardon me, Your Honor? 13445 1 THE COURT: I got your resistance? 2 MR. CASHMAN: Yes. 3 Let me back up just a moment, then, 4 Your Honor, and add that Microsoft put in the 5 bare bones motion, which I mentioned, on the 6 18th. 7 Plaintiffs filed a resistance on -- 8 THE COURT: The 29th? 9 MR. CASHMAN: And then after that, 10 Microsoft filed what we think is a deficient 11 affidavit for reasons I'll address further in a 12 moment from a Mr. Aeschbacher from Microsoft, 13 in-house legal counsel for Microsoft. And then 14 just last night served us with a rereply 15 memorandum. 16 THE COURT: Is that what you just gave 17 me? 18 MR. JONES: Yes, Your Honor, I 19 provided the Court with a copy of the 20 affidavit, the Aeschbacher affidavit. 21 THE COURT: And the reply. 22 MR. JONES: And the reply, yes, Your 23 Honor. 24 And I would just note for the record, 25 the first page, footnote one of the reply brief 13446 1 identifies five documents that Microsoft is 2 withdrawing confidentiality or trade secret 3 assertion. 4 THE COURT: Okay. But I only have one 5 resistance from Plaintiffs; right? 6 MR. CASHMAN: That's right. 7 THE COURT: Okay. Go ahead. I've got 8 your rulings chart. 9 MR. CASHMAN: Okay. What I've handed 10 up to the Court is a rulings chart. 11 THE COURT: Okay. 12 MR. CASHMAN: That follows on the law 13 as we've just discussed. 14 For each document, there are three 15 boxes. And that is to indicate that Microsoft 16 has to prove by sufficient proof all three of 17 these elements for each document in order to 18 maintain its confidential status. 19 MR. JONES: Your Honor, I'm sorry to 20 interrupt Mr. Cashman, but it has been the 21 practice of the parties certainly in the Phase 22 6, 7, and in the rulings aspects of this case 23 to exchange rulings charts prior to submission 24 to the Court so the parties can be satisfied 25 that they were appropriate. 13447 1 Mr. Cashman didn't provide this to me 2 ahead of time. That's a breach of our common 3 courtesy that we've extended each other 4 throughout this case. 5 I'm going to reserve my right to 6 object. I'm not going to interrupt Mr. Cashman 7 further, but if we have objection or identified 8 errors, we will bring them to the Court's 9 attention. 10 MR. CASHMAN: Well, let me just say, 11 Your Honor, that this isn't an appeal from the 12 Special Master. This is argument on a motion 13 which Microsoft filed. 14 MR. JONES: And this is common 15 courtesy to provide documents that are going to 16 be used by the Court prior to submitting them 17 to the Court. 18 I'll say nothing further. 19 MR. CASHMAN: In any event, Your 20 Honor, in order for Microsoft's claims of 21 confidentiality to have any -- to be sustained, 22 all three of these elements would have to be 23 deemed to have been proven by Microsoft. 24 And Plaintiffs believe that Microsoft 25 not only failed to provide any evidence to 13448 1 support its claims at the time it was required 2 to make those showings in January, but that its 3 proof or alleged proof at this time is still 4 deficient for a variety of reasons. 5 First of all, I'm just going to use 6 one example to start off with, Your Honor. 7 And if I may approach. 8 THE COURT: Now, are these exhibits 9 all contained with the disk too with the 10 exhibits that were offered on January 11th that 11 Plaintiffs provided? They should be on there, 12 right? 13 MR. JONES: Yes, Your Honor, that 14 would be my understanding. 15 THE COURT: Mr. Cashman; is that 16 right? 17 MR. CASHMAN: That should be, Your 18 Honor. 19 THE COURT: So I can use them on here 20 too? 21 MR. JONES: Yes, Your Honor. I would 22 note if Mr. Cashman is going to show what we 23 asserted as a trade secret document to the 24 Court, then this portion of the discussion of 25 the document will need to be under seal. 13449 1 THE COURT: Very well. Go ahead. 2 (Whereupon, proceedings adjourned at 3 3:39 p.m. and under-seal proceedings began.) 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 13450 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 9th 19 day of February, 2007. 20 21 22 ______________________________ Certified Shorthand Reporter(s) 23 24 25