10399 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 XXXVIII 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 8:20 a.m., January 25, 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 10400 1 A P P E A R A N C E S 2 Plaintiffs by: ROXANNE BARTON CONLIN 3 Attorney at Law Roxanne Conlin & Associates, PC 4 Suite 600 319 Seventh Street 5 Des Moines, IA 50309 (515) 283-1111 6 MICHAEL R. CASHMAN 7 Attorney at Law Zelle, Hofmann, Voelbel, 8 Mason & Gette, LLP 500 Washington Avenue South 9 Suite 4000 Minneapolis, MN 55415 10 (612) 339-2020 11 ROBERT J. GRALEWSKI, JR. Attorney at Law 12 Gergosian & Gralewski 550 West C Street 13 Suite 1600 San Diego, CA 92101 14 (619) 230-0104 15 KENT WILLIAMS Attorney at Law 16 Williams Law Firm 1632 Homestead Trail 17 Long Lake, MN 55356 (612) 940-4452 18 19 20 21 22 23 24 25 10401 1 Defendant by: DAVID B. TULCHIN 2 STEVEN L. HOLLEY SHARON L. NELLES 3 JEFFREY C. CHAPMAN Attorneys at Law 4 Sullivan & Cromwell, LLP 125 Broad Street 5 New York, NY 10004-2498 (212) 558-3749 6 ROBERT A. ROSENFELD 7 KIT A. PIERSON Attorneys at Law 8 Heller Ehrman, LLP 333 Bush Street 9 San Francisco, CA 94104 (415) 772-6000 10 DAVID SMUTNY 11 Attorney at Law Heller Ehrman, LLP 12 1717 Rhode Island Ave. NW Washington, D.C. 20036-3001 13 (202) 912-2000 14 HEIDI B. BRADLEY Attorney at Law 15 Heller Ehrman, LLP 333 South Hope Street 16 Suite 3900 Los Angeles, CA 90071-3043 17 (213) 689-0200 18 DAVID E. JONES Attorney at Law 19 Heller Ehrman, LLP One East Main Street 20 Suite 201 Madison, WI 53703-5118 21 (608) 663-7460 22 23 24 25 10402 1 BRENT B. GREEN Attorney at Law 2 Duncan, Green, Brown & Langeness, PC 3 Suite 380 400 Locust Street 4 Des Moines, IA 50309 (515) 288-6440 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 10403 1 (The following record was made out of 2 the presence of the jury at 8:20 a.m.) 3 THE COURT: Morning. 4 Mr. Tulchin, you wanted to be heard? 5 MR. TULCHIN: Yes. With the Court's 6 permission, Mr. Holley will address this issue. 7 MR. HOLLEY: Good morning, Your Honor. 8 Yesterday there was a request from the 9 Plaintiffs for a curative instruction with 10 regard to a question that Mr. Tulchin asked 11 Mr. Bradford about a lawsuit brought by Lantec, 12 a competing maker of network software, against 13 Novell alleging violations of Section 2 of the 14 Sherman Act. 15 And for various reasons, it's 16 Microsoft's position that no such instruction 17 is warranted. 18 Initially, as Mr. Tulchin pointed out 19 yesterday, various questions by both sides on 20 direct and cross have been objected to in -- at 21 the time, and the Court has either sustained or 22 overruled those objections, and there hasn't 23 been some curative instruction telling the jury 24 that the question was improper. 25 So this would be a departure from 10404 1 normal procedure and would call attention to 2 something which isn't warranted. 3 So that's our procedural objection. 4 On substance, Your Honor, the question 5 was perfectly appropriate because Mr. Bradford 6 testified extensively on direct examination 7 about the fact that Microsoft was investigated 8 both by the Federal Trade Commission starting 9 in 1990 and then by the Department of Justice 10 starting in 1993. 11 And the mere purpose of that testimony 12 being elicited was to suggest to the jury that 13 the fact of those investigations could be -- 14 could give rise to an inference that Microsoft 15 had done something wrong. Otherwise, why was 16 the testimony being elicited. 17 And, of course, the fact of the matter 18 is that the Federal Trade Commission never did 19 anything having, investigated the matter for 20 some time. 21 On two occasions the commission 22 considered the question of bringing enforcement 23 action against Microsoft, and on both 24 occasions, there was a 2-2 vote and the 25 commission did not proceed. 10405 1 So it is not a fair inference that 2 because the government investigated Microsoft 3 that Microsoft had done something wrong. 4 As the Iowa Supreme Court has said in 5 State against Monroe, when lawyers make 6 tactical choices that create inferences that 7 help their clients, they open the door to 8 rebuttal by their adversary. 9 So if Plaintiffs make a choice to 10 suggest through the testimony not only of 11 Mr. Bradford, but also of Mr. Alepin, that 12 Microsoft has been subjected to numerous 13 government investigations and private lawsuits 14 -- and the Court will recall that Mr. Lamb took 15 Mr. Alepin through numerous lawsuits that have 16 been filed against Microsoft in the course of 17 talking about Mr. Alepin's credentials. 18 So the jury has heard all about Sun 19 suing Microsoft and RealNetworks suing 20 Microsoft. 21 And the clear implication of this is 22 that where there's that much smoke, there must 23 be fire. 24 And that -- if that suggestion has 25 been created in the minds of the jurors, it's 10406 1 perfectly appropriate for Microsoft to counter 2 that door opening by noting that other 3 companies that are successful in the 4 marketplace and acquire large market positions 5 are sued by their competitors. 6 It is a routine practice in American 7 business, there is an entire field of study 8 about the strategic use of antitrust litigation 9 against competitors, so it's our position, Your 10 Honor, that there was nothing improper about 11 the question and therefore no need for an 12 instruction. 13 Now if the Court is nonetheless 14 inclined to give an instruction, which we don't 15 think is appropriate, we certainly don't think 16 that the instruction that Ms. Conlin read to 17 the Court yesterday is the appropriate sort of 18 instruction because there needs to be parity on 19 this point. 20 The jury needs to be told, if they're 21 going to be told, that testimony from witnesses 22 on either side about prior investigations and 23 prior litigation should not be assumed to mean 24 that there's any merit to those cases. 25 That was not Mr. Tulchin's suggestion. 10407 1 His point was, and it's a perfectly valid point 2 given what Plaintiffs have done, is that people 3 who are successful in business often get sued. 4 That's the point. 5 But, Your Honor, I'd like -- if I 6 could approach the Court, I'd like to hand up 7 our suggestion -- and I need to give one to 8 Ms. Conlin first -- of the sort of instruction 9 that we would suggest if the Court is inclined 10 to give it and what -- it's a neutral 11 instruction. It would apply to both parties. 12 And it would say that witnesses have 13 testified and will continue, I assume, to 14 testify about government investigations that 15 have been instigated against Microsoft, Novell, 16 and other companies. 17 The existence of these lawsuits or 18 investigations is not proof of any wrongdoing 19 and you are not to conclude from the fact that 20 a lawsuit is brought or an investigation was 21 undertaken that those claims have any merit. 22 So, Your Honor, that -- if an 23 instruction is going to be given, and as I 24 said, we don't believe it's necessary or 25 appropriate, but if it happens, we think it 10408 1 should not be some sort of attack on Microsoft 2 or its counsel. It should apply equally to 3 both parties, and as with all of the Court's 4 other instructions, it should be a neutral 5 statement of the law. 6 That's all I have on that, Your Honor. 7 MS. CONLIN: Your Honor, my request 8 for an instruction was, in fact, a departure 9 from our normal procedure because for the 10 Defendant to ask such a question was a 11 departure from our normal procedure. 12 The purpose of testimony with respect 13 to the FTC and the DOJ was to assure that the 14 witness was not vulnerable on cross-examination 15 to a surprise assertion that he was simply a 16 pawn of the government or the government was 17 simply a pawn of his because DOJ, FTC all over 18 the documents in this matter, Your Honor, with 19 respect to this witness and others. 20 And there is also a difference in that 21 it was Microsoft who was under investigation. 22 Microsoft is a party to this lawsuit. 23 That investigation of the FTC and 24 subsequently the DOJ, as the Court is well 25 aware, forms a part of the basis of this 10409 1 lawsuit. 2 Novell, however, is not a party, and 3 the idea that there needs to be parity, I 4 think, is an erroneous idea. 5 There's not parity of questioning and 6 there therefore should not be parity of -- in 7 connection with the instruction. 8 It was Mr. Tulchin who suddenly out of 9 nowhere brought up this antitrust lawsuit. And 10 the Court will recall it wasn't just that 11 Novell was sued. That's not the point that 12 Mr. Tulchin was making. 13 First he asked, as I recall, what the 14 market share of Novell was, and then he asked 15 the question about the lawsuit, which was, as 16 he carefully pointed out, for antitrust 17 violations. 18 If the Court is not going to instruct 19 on this issue, then -- I, of course, will not 20 do this without asking the Court's permission, 21 but I assume that when I get to the defense 22 case and the defense witnesses are here, I can 23 ask them about the lawsuits against Microsoft. 24 And I'll try to divide them up in some fashion 25 that creates parity among the witnesses. 10410 1 The point that Mr. Tulchin was making 2 and the point that I fear the jury has gotten 3 from the question, even though it was objected 4 to and the objection was sustained, was that 5 Microsoft -- or that Novell was also guilty of 6 antitrust violations. 7 So, Your Honor, I believe that the 8 instruction is warranted, and I think that it 9 can be given, and I think that Mr. Tulchin's 10 questioning of this witness on that issue was 11 highly prejudicial to the Plaintiffs. 12 THE COURT: Anything else? 13 MR. HOLLEY: Your Honor, just briefly. 14 I'm surprised to hear Ms. Conlin say 15 that the investigation by the Federal Trade 16 Commission forms part of the basis of this 17 lawsuit. 18 There is no collateral estoppel as to 19 what is usually referred to as Microsoft I, 20 which is the series of investigations first by 21 the FTC, then taken over by the DOJ, resulting 22 in the consent decree which was signed on the 23 15th of July of 1994. 24 That is entirely separate, that 25 proceeding, from what is frequently referred to 10411 1 as Microsoft II, which is the lawsuit which was 2 begun on the 18th of May of 1998, and that is 3 the only lawsuit that has been -- as to which 4 any findings or conclusions have been given 5 collateral estoppel effect. 6 If the Plaintiffs want to seek to 7 prove the claims that the FTC considered 8 investigated and abandoned, then they have to 9 prove them. That's their obligation, and they 10 can't piggyback on the fact that some 11 government agency looked at these claims. 12 If they do, Your Honor, then we would 13 press again our argument that we are entitled 14 to ask, as we sought to do with Mr. Alepin, 15 witnesses to show that although the FTC looked 16 at FUD, vaporware, integration, and all of the 17 claims relating to DR-DOS, that the Plaintiffs 18 are pursuing here in the exercise of their 19 public interest obligations they decided not to 20 bring those claims. 21 If they want to open the door to that, 22 then we should be able to walk right through 23 it. 24 So I just want to make that point, 25 Your Honor. 10412 1 There is no collateral estoppel effect 2 to anything other than the second DOJ case. 3 The first DOJ case, they have to prove 4 they have no benefit of collateral estoppel. 5 THE COURT: Mr. Holley, what was the 6 case Mr. Tulchin mentioned? 7 MR. HOLLEY: There is a case, Your 8 Honor -- 9 THE COURT: The one he specifically 10 asked? 11 MR. HOLLEY: There is a case brought 12 by a company called Lantec, L-a-n-t-e-c, Your 13 Honor. 14 THE COURT: Okay. And the question 15 about -- to Mr. Bradford was with regard to FTC 16 or government investigation; right? 17 MR. HOLLEY: Those questions were 18 asked by Ms. Conlin on direct. 19 THE COURT: Right. And they were 20 about FTC and the government; right? 21 MR. HOLLEY: That is correct, Your 22 Honor. 23 THE COURT: How is there parity when 24 there's a private company sued? 25 MR. HOLLEY: Because the suggestion is 10413 1 that claims made either by private parties or 2 by the government gives rise to some inference 3 that -- no one said that explicitly, but that's 4 the clear purpose of all of this. 5 The notion is that, you know, if 6 you're investigated, there must be something 7 under there. And frankly, it's much worse when 8 the notion is that the government did it 9 because, you know, everyone can accept the 10 proposition that there are Plaintiffs out there 11 who are off the wall and bring completely 12 frivolous claims. But the jurors are much less 13 likely to believe that the Federal Trade 14 Commission brought some entirely frivolous 15 claim. 16 So in my view, Your Honor, it's 17 actually much worse when the implication is 18 created that, you know, there was a government 19 investigation because people tend to believe 20 that the government doesn't act in a completely 21 irrational way. 22 THE COURT: So according to your 23 interpretation of Monroe, any witness who 24 appears here, they can be asked if they've been 25 sued in any case whatsoever for anything; is 10414 1 that right? 2 MR. HOLLEY: Well, I'm not sure I'd 3 go that far, Your Honor, but I believe a 4 witness -- 5 THE COURT: Wouldn't that be parity? 6 After all, you're being sued. 7 MR. HOLLEY: No, Your Honor. 8 I think the point that I was seeking 9 to make is that a company -- that a witness who 10 works for a company or worked for a company 11 that had a market share within the range that 12 the Court has instructed the jury would give 13 rise to an inference of monopoly power and who 14 has been sued for antitrust violations could be 15 asked whether such a claim was brought because 16 the Plaintiffs have opened the door to that by 17 noting that Microsoft with its high market 18 share has been both sued by numerous 19 competitors and investigated by various 20 government agencies. 21 They didn't have to do that, but they 22 did. 23 THE COURT: Anything else on this 24 issue? 25 MS. CONLIN: Just very briefly, Your 10415 1 Honor. 2 Mr. Holley just made my point in his 3 last remark. 4 Mr. Tulchin did, in fact, say to this 5 witness again and again, you know, when you 6 were complaining every day to the federal 7 government and when you were making all of your 8 complaints to the federal government -- and, of 9 course, we know there's no collateral estoppel. 10 I hope that I was clear to the Court. 11 What I meant when I said forms the basis was 12 that we, in fact, have and have relied on the 13 documents, the statements, the depositions, and 14 so on from that -- those early investigations 15 which were three- or four-fold, as I recall. 16 So, Your Honor, I believe that the 17 instruction is justified and that the record as 18 it stands is highly prejudicial to the 19 Plaintiffs. 20 THE COURT: Anything further? 21 MR. HOLLEY: No, Your Honor. 22 THE COURT: Very well. 23 Court is going to give the following 24 instruction. 25 A question was asked on the 10416 1 cross-examination of Plaintiffs' witness 2 Mr. Bradford regarding Novell being sued by 3 another company or entity. An objection to the 4 question was sustained. 5 You are instructed that you are not to 6 find or infer anything from the question to 7 Mr. Bradford, nor may you speculate as to what 8 the answer may have been regarding any alleged 9 lawsuit against Novell. 10 A copy will be given to the parties. 11 Carrie, I need 11 copies for the 12 jurors, and give two to the parties. Then you 13 can get the jury. 14 MR. HOLLEY: Your Honor, just for the 15 record, I would note that Microsoft objects to 16 this instruction, and it's highly prejudicial 17 to us and not the sort of instruction that the 18 jury should be given in these circumstances 19 just for the record. 20 (An off-the-record discussion was 21 held.) 22 (The following record was made in the 23 presence of the jury at 8:42 a.m.) 24 THE COURT: Everyone else may be 25 seated. 10417 1 Ladies and gentlemen of the jury. 2 Thank you for your patience. We had a matter 3 that's had to be conducted by the Court only 4 and the attorneys. 5 You've been handed Preliminary 6 Instruction No. 36 regarding David Bradford. 7 I'll read it to you real quickly. 8 A question was asked on the 9 cross-examination of Plaintiffs' witness 10 Mr. Bradford regarding Novell being sued by 11 another company or entity. An objection to the 12 question was sustained. 13 You are instructed that you are not 14 to find or infer anything from the question of 15 Mr. Bradford, nor may you speculate as to what 16 the answer may have been regarding any alleged 17 lawsuit against Novell. 18 THE COURT: You may proceed with 19 cross. 20 Mr. Bradford, you're still under oath. 21 MR. TULCHIN: Thank you, Your Honor. 22 DAVID BRADFORD, 23 recalled as a witness, having been previously 24 duly sworn, testified as follows: 25 CROSS-EXAMINATION (CONT'D) 10418 1 BY MR. TULCHIN: 2 Q. Good morning, Mr. Bradford. 3 A. Hello. 4 MR. TULCHIN: May I approach the 5 witness, Your Honor? 6 THE COURT: Yes, you may. 7 Q. Mr. Bradford, I'm handing you 8 Defendant's Exhibit 6776, and this is a 9 memorandum that you wrote, is not, sir? 10 A. Yes. 11 Q. It's a memorandum you wrote around 12 December 3rd, 1991; correct? 13 A. That's right. 14 Q. And it records your notes of your 15 meeting of November 24, 1991, with Bill Gates 16 and Steve Ballmer; right? 17 A. Well, it records the interaction 18 between Darrell Miller and Ray Noorda, not my 19 meeting with Gates and Ballmer. 20 Q. Fair enough. I stand corrected. 21 MR. TULCHIN: Your Honor, we offer 22 Defendant's Exhibit 6776. 23 MS. CONLIN: No objection. 24 THE COURT: It's admitted. 25 MR. TULCHIN: If we could just look at 10419 1 the first page. 2 Q. And again, Mr. Bradford, this is -- 3 those are your initials there next to your 4 name? 5 A. They are. 6 Q. Is that something you commonly did 7 when you were sending a memo to the files at 8 Novell? 9 A. Yes, it is. 10 Q. And it says, results of November 24th 11 meeting with Microsoft. 12 Just below in the first paragraph, it 13 says, on Sunday, November 24, Darrell Miller 14 and Ray Noorda met with Bill Gates and Steve 15 Ballmer at the San Francisco airport. 16 Do you see that, sir? 17 A. I do. 18 Q. And I think you testified briefly 19 about that meeting on direct examination. 20 Do you recall that? 21 A. I think I testified specifically about 22 a Ray Noorda/Bill Gates meeting that occurred 23 earlier in the year. 24 Q. Was it also at the San Francisco 25 airport, is that -- 10420 1 A. Yes. 2 Q. -- maybe why -- 3 A. Yes. 4 Q. Okay, fair enough. 5 And I want to direct your attention 6 for the moment, if I may, to the second page. 7 And you'll see the letter A. 8 You have a heading which says 9 complicating factors, and then there is the 10 letter A, and then, Mr. Bradford, you say this, 11 neither Novell nor Microsoft want the source 12 code which would be shipped to these testing 13 teams to be shared with other parts of the 14 other entities' company. 15 Now, let me just pause there if I may. 16 We're talking about the source code to 17 various software products made either by Novell 18 or by Microsoft; correct? 19 A. That's right. 20 Q. And the source code, of course, is the 21 property of the company that developed that 22 software? 23 A. That's right. 24 Q. And I take it from your memorandum 25 that there had been some discussion at this 10421 1 meeting on November 24, '91, with Microsoft 2 about testing one another's beta versions of 3 software products; correct? 4 A. Well, I assume there was. I wasn't at 5 the meeting, but these are my recollections 6 from what Darrell or Ray told me when they 7 returned. 8 Q. Right, but I skipped over the first 9 page in the interest of time. 10 A. Okay. 11 Q. But that's what's being discussed 12 here, is it not, at least in part? 13 Testing one another's software 14 products so that the two companies could find a 15 way to make each company's software work better 16 with the other company's software? 17 A. I'm sure, among other things, that 18 interoperability was discussed at that meeting. 19 Q. Right. And I think you'll see 20 reference to that on the first page. 21 But so let's go back to point A on 22 page 2. 23 You go on to say, for example, Novell 24 would not want the source code to the NetWare 25 shell to be transferred to Microsoft's LAN 10422 1 manager group. 2 Again, I want to stop for just a 3 moment. 4 The NetWare, of course, is Novell's 5 product? 6 A. That's right. 7 Q. And Microsoft had a competing LAN 8 manager product? 9 A. Correct. 10 Q. And I think what you're saying here is 11 that if the -- if Novell, for example, is to 12 send a beta version of its product to Microsoft 13 for testing, Novell wouldn't want that beta 14 version of the NetWare shell to be used by 15 people at Microsoft who are developing a 16 competing product. 17 Is that what that means? 18 A. I suppose. Again, I'm recording the 19 discussions that Ray and Darrell had with Bill 20 and Steve as opposed to my own personal 21 opinion, et cetera, et cetera. 22 Q. I understand that, but did I state 23 accurately what your sentence is intended to 24 mean; Novell doesn't want the people at 25 Microsoft who are competing, making a competing 10423 1 product at Novell's to get Novell's source 2 code? 3 A. Yes, in general that would be correct. 4 Q. And the other side of it is stated in 5 the next sentence. 6 By the same token, Microsoft would not 7 want the Windows source code transmitted to 8 Novell's Digital Research subsidiary. Is that 9 right? 10 A. All right, uh-huh. 11 Q. Was that a proposition that both 12 companies adhered to over the period that you 13 worked at Novell? 14 Novell didn't want its source code to 15 be used at Microsoft by people making a product 16 that competed with Novell's NetWare, and 17 Microsoft didn't want its operating system for 18 Windows source code to be used by the Digital 19 Research subsidiary of Novell? 20 A. As a general proposition, that's 21 right. 22 Q. Thank you, sir. 23 MR. TULCHIN: Your Honor, may I 24 approach the witness? 25 THE COURT: Yes. 10424 1 Q. I want to hand you next, Mr. Bradford, 2 a memorandum that appears to have been written 3 by John Constant on the 25th of January, 1992. 4 This is Defendant's Exhibit 145. 5 MR. TULCHIN: We offer this document, 6 Your Honor. 7 MS. CONLIN: Your Honor, may we 8 approach? 9 THE COURT: You may. 10 (The following record was made out of 11 the presence of the jury at 8:49 a.m.) 12 MS. CONLIN: Your Honor, here is the 13 memorandum. I have no objection to the 14 document, but where Mr. Tulchin is going is in 15 direct violation of the Court's order with 16 respect to the question of where betas came 17 from and the like, at least that's my 18 understanding. That would be my guess where 19 he's going. 20 I'm at somewhat of a disadvantage, 21 Your Honor, because you'll recall that 22 Mr. Constant came to testify and had to return 23 to England, so he will be back. I don't want 24 this document used for this witness. He knows 25 nothing about it. It's unfair, and it also 10425 1 violates the Court's motion in limine. 2 THE COURT: Go ahead, Mr. Tulchin. 3 MR. TULCHIN: Your Honor, I'm not 4 using this to show that Novell acquired the 5 data in some improper way, only that Novell had 6 it. 7 And the third page -- my only question 8 to this witness is on the third page. There 9 was no objection, by the way, to this document 10 ever lodged, and I didn't think there was 11 anything controversial about it. The document 12 itself doesn't reveal how Novell obtained the 13 beta, and there's no question to this witness 14 on that subject that I plan to ask. 15 But at the very top of the third page, 16 it says test latest Windows 3.1 beta with 17 DR-DOS 6.0. 18 And all I wanted to do was to ask this 19 witness whether, as far as he understood it, 20 Novell had a copy of the Windows 3.1 beta. 21 Your Honor, on direct, of course, this 22 witness said that Novell was injured over a 23 course of years because it didn't get the betas 24 or didn't get them as frequently as other 25 companies. I think this is legitimate cross. 10426 1 I have no intention of violating the Court's 2 order by trying to explore how they got it. 3 MS. CONLIN: Your Honor, I have no 4 objection to him asking the question: Did 5 Novell have access to the betas. 6 THE COURT: Okay. 7 MS. CONLIN: That is a legitimate 8 question. But to use this document with this 9 witness, I don't have an objection to the 10 document, David. I just have an objection to 11 the document being used with this witness who 12 knows nothing about it, and it's just unfair to 13 the witness. 14 MR. TULCHIN: Well, Your Honor, if he 15 knows nothing about it, it will be very brief. 16 He'll say I know nothing about it. 17 THE COURT: Okay. Just stay away from 18 the one thing. Off the record. 19 (The following record was made in the 20 presence of the jury at 8:53 a.m.) 21 THE COURT: Sorry for the delay. 22 You were offering 145? 23 MR. TULCHIN: Yes, sir. 24 MS. CONLIN: No objection. 25 THE COURT: It's admitted. 10427 1 Q. Mr. Bradford, sorry for the delay. 2 If you could look at the third page -- 3 well, let's just look at the first page for a 4 minute. 5 John Constant is somebody you've 6 mentioned in the past; correct? 7 A. Yes. 8 Q. And he worked at Digital Research? 9 A. That's right. 10 Q. And, of course, the other names we've 11 talked about. I think you've mentioned Steve 12 Tucker, Andy Wightman, and John Bromhead 13 before. I'm not sure about Glenn Stephens. 14 A. Right. All DRI employees. 15 Q. Okay. And I just would ask you, sir, 16 to turn to the top of the third page. 17 There's a heading at the top which 18 says Windows 3.X. Do you see that? 19 And just below it, there's an entry 20 that says, test latest Windows 3.1 beta. 21 That's the symbol, is it not, for 22 beta, the Greek beta letter? 23 A. I suppose, but I -- typically, you 24 write beta if you mean beta. 25 Q. But it says, test latest Windows 10428 1 3.1 -- and maybe that's a beta -- with DR-DOS 2 6.0, et cetera. 3 And my only question to you, 4 Mr. Bradford, is whether or not as of January 5 25, '92, the date of this memo, you were aware 6 that Mr. Constant apparently had a copy or 7 Novell had a copy of the latest Windows 3.1 8 beta? 9 MS. CONLIN: Your Honor, I object to 10 the question as compound. 11 THE COURT: Overruled. He can answer 12 if he understands. 13 A. No, I had no personal knowledge of 14 that. 15 Q. Did you become aware at around this 16 time in 1992 that Novell was getting copies of 17 the 3.1 beta, the Windows 3.1 beta? 18 A. Not necessarily. 19 As a general proposition, I remember 20 the companies exchanging betas at some point in 21 time, and we talked ad infinitum about the 22 exchange of betas, so -- 23 But I have no specific recollection of 24 DRI -- again, at this point in time, remember, 25 Digital Research was a separate legal entity 10429 1 from Novell, Inc. They were operating pretty 2 much independently of what we were doing. 3 So I had no recollection of tests, 4 latest Windows 3.1 b, or beta, with DR-DOS 6.0. 5 MR. TULCHIN: May I approach the 6 witness, Your Honor? 7 THE COURT: Yes, you may. 8 Q. I want to give you two documents at 9 the same time, Mr. Bradford. 10 Just at the end of the day yesterday I 11 think one or both of us mentioned contracts 12 between Microsoft and Novell concerning betas, 13 and I've handed you Defendant's Exhibits 3628 14 and 3627. 15 Do you have them, sir? 16 A. I do. 17 Q. Are these indeed contracts between 18 Microsoft and Novell for the beta versions of 19 certain Microsoft products? 20 A. Well, let's read through. 21 I apologize, I don't have my glasses 22 on me. 23 MS. CONLIN: Do you have your glasses? 24 THE WITNESS: I don't have them on me. 25 They're in my coat at the back of the room. 10430 1 MS. CONLIN: Do you want me to get 2 them for you? 3 THE WITNESS: Sure. 4 MS. CONLIN: Because you're squinting 5 like this. 6 A. So Microsoft Corporation nondisclosure 7 agreement. 8 Q. Are you looking at 3628? 9 A. Yes. 10 Q. Maybe we should wait till you get your 11 glasses. 12 A. Well, I think I should read that much. 13 Q. Okay. 14 A. If you want to highlight it for the 15 jury. 16 Q. Well, we can't do it until it's in 17 evidence. 18 A. So Microsoft Corporation nondisclosure 19 agreement is what it says at the top. 20 Q. And then it says prerelease product, 21 and you see where it says product name Chicago? 22 We'll wait for your glasses. I think 23 that will make things easier. And Ms. Conlin 24 is helping us all out. 25 MS. CONLIN: May I approach, Your 10431 1 Honor? 2 THE COURT: You may. 3 A. Good. 4 So, again, this appears to be a 5 nondisclosure agreement that relates to a 6 prerelease version of Chicago. 7 Q. And the prerelease version, that 8 refers to the beta; correct? 9 A. Yes, in all likelihood. 10 Q. And if you look at the last page of 11 3628, you'll see a signature from Richard W. 12 King. Do you see that, sir? 13 A. Yes, I do. 14 Q. And he was a Novell employee? 15 A. Right. He was a vice president in our 16 Novell products group. 17 Q. And this was signed on or about 18 December 10, 1993; is that right? 19 A. Yes. 20 MR. TULCHIN: Microsoft offers 21 Defendant's Exhibit 3628. 22 MS. CONLIN: No objection. 23 THE COURT: It's admitted. 24 Q. Let's look briefly at 3627. We'll 25 come back to the other one. 10432 1 But is this another contract for the 2 beta version of Chicago? 3 A. Again, it's a nondisclosure agreement, 4 as it says at the top, relating to -- and I'll, 5 you know, concede it's probably a prerelease or 6 beta version of Chicago. 7 So I don't know if it relates to a 8 product exchange or it relates to nondisclosure 9 associated thereto. I'd have to look through 10 the document. 11 Q. All right. And then if you'll look at 12 the third page, the last page of Exhibit 3627, 13 you'll see it was signed by someone named David 14 Moon, M-o-o-n, Moon of WordPerfect. 15 Do you see that, sir? 16 A. That's right. Dave was a vice 17 president within our WordPerfect division, and 18 this appears to have been signed May 1994. So 19 either shortly or just before Novell's 20 acquisition of WordPerfect. 21 Q. Okay. 22 MR. TULCHIN: We offer Exhibit 3627, 23 Your Honor. 24 MS. CONLIN: No objection, Your Honor. 25 THE COURT: Admitted. 10433 1 Q. If we could look at 3628 first. 2 That's the 1993 nondisclosure agreement for 3 Chicago. 4 You're familiar with these sorts of 5 agreements or contracts, are you not, sir? 6 A. I'm familiar with nondisclosure 7 agreements, yeah. 8 Q. Okay. And you'll see in the paragraph 9 numbered one, it says, grant of license, and 10 then it says -- and I know there's a lot of 11 legal language here, but -- Microsoft grants 12 company -- and company refers to in this case 13 Novell; is that right? 14 A. Upon receipt, Microsoft, this 15 agreement signed and completed by the 16 individual organization indicated below 17 (company). 18 Okay, so if it's indicated below -- 19 okay, yes. 20 Q. Okay. So Microsoft grants company or 21 Novell the right to use the product -- and the 22 product had been defined as Chicago; right? 23 A. Yes. Operating system and prerelease 24 development kit for that. 25 Q. Right. So that would include the beta 10434 1 for Chicago or Windows 95; correct? 2 A. If these two are equivalent, yes. 3 Q. Okay. 4 A. It says PDK release. Product 5 development kit is what that refers to. 6 Q. Right. Prerelease development kit 7 maybe, PDK? 8 A. Yes. 9 Q. Okay. So Microsoft grants Novell the 10 right to use the -- we'll call it the beta 11 version of Chicago only for the purpose of 12 developing company's -- and then it has a list 13 of products; redirectors, transports, NetWare 14 directory services. I won't read them all, 15 Mr. Bradford, but it goes on. 16 -- to run on, connect to, or 17 interoperate with the product. That would be 18 Chicago; right? 19 A. Right. 20 Q. And testing such Novell products with 21 the beta version of Chicago for evaluating the 22 product for the sole purpose of providing 23 feedback to Microsoft. 24 Do you see that, sir? 25 A. Yes, I do. 10435 1 Q. And then it talks about a biweekly 2 status report to Microsoft by Novell. 3 There's another sentence about the 4 feedback. 5 And then later on in this paragraph, 6 it says, provided that each such copy is used 7 only for the purposes stated above and used 8 only by the authorized individuals listed in 9 Section 4. 10 Do you see that, Mr. Bradford? 11 A. Can he highlight that? I'm sorry. 12 Q. Sure. 13 I don't want to -- if I'm going too 14 fast, I'll stop, because the sentence begins by 15 saying, Microsoft grants company, or Novell, 16 the nontransferrable right to make and use the 17 number of copies as described in Section 3, 18 provided that each such copy is used only for 19 the purposes stated above and used only by the 20 authorized individuals listed in Section 4. 21 Are you with me? 22 A. Yes. 23 Q. And then it goes on, the next 24 sentence -- actually, the one beyond that. 25 Company may not reverse engineer, 10436 1 decompile or disassemble the product's 2 software. Company must cease use of the 3 product upon the earlier of either Microsoft's 4 public release of the commercial version or 5 upon request by Microsoft. 6 And then I want to turn to the -- 7 well, let me ask this question. 8 These are common terms in these kind 9 of beta contracts, are they not? 10 A. Yes. 11 Q. All right. Let's go to the next page 12 -- maybe before we do, just noting Point 3 on 13 the first page, it says, copyright, the product 14 is owned by Microsoft. 15 And that's consistent with what we've 16 talked about before; correct, sir? 17 A. That's right. 18 Q. All right. And then if you go to the 19 second page, which is a continuation of 20 paragraph four, towards the top there is a 21 sentence that begins the names and product 22 development area of the attendees Microsoft may 23 send to a developer conference or identified in 24 Exhibit A. 25 And then it says this, until the 10437 1 product is -- software is commercially released 2 by Microsoft, Novell agrees that the product 3 will not be made available, nor will Novell 4 assign any of the individuals identified in 5 Exhibit A, to the development teams of any 6 directly competing operating system product, 7 including personal NetWare, Novell DOS 8 development (DR-DOS), et cetera. 9 And I just want to stop there. 10 And again, sorry for all this legal 11 language, but what this contract provides is 12 that the beta version of Chicago may be used by 13 Novell for a number of purposes including 14 testing, but the development team for DR-DOS is 15 not authorized to get a copy of the beta 16 correct. 17 A. That's right. Under this agreement of 18 December 1993. 19 Q. All right. And again going back to 20 the document we looked at earlier this morning, 21 your notes of the meeting in San Francisco, 22 which was Exhibit 145, that's consistent with 23 what Mr. Gates and Mr. Noorda talked about at 24 that meeting? 25 A. In general, yeah. 10438 1 MR. TULCHIN: So could we look at 2 Exhibit 3627? 3 Q. And I think we've already identified 4 this as another nondisclosure agreement for the 5 beta version of Chicago. 6 MR. TULCHIN: Let's just go to the 7 first page quickly. Look at the top. 8 Q. And as we discussed earlier, this is 9 from May of 1994 with WordPerfect? 10 A. That's right. 11 Q. And I want to -- well, the grant of 12 license, paragraph one, is substantially the 13 same as in the prior version. Does that look 14 right to you? 15 A. Okay. For purposes of our discussion 16 to move things along, yes. 17 Q. And paragraph three says, copyright, 18 the product is owned by Microsoft, as in the 19 other paragraph; correct? 20 A. Well, let's see. I don't want to be 21 too quick on that. 22 So if we look back on number one, 23 there's a grant of license, and as I just 24 perused I saw the term open doc in it. 25 Q. Right. It's not identical to the 10439 1 paragraph one from the prior document, but 2 speaking lawyer to lawyer, the terms are 3 substantially the same, are they not? 4 And if you don't know, Mr. Bradford, I 5 don't want to spend a lot of time on that. 6 A. Right. For purposes of our discussion 7 today, without going into the details, let's 8 agree that it's substantially the same. 9 Q. Okay. 10 And then let's look at page 2 of 11 Exhibit 3627, the 1994 agreement with 12 WordPerfect. 13 And beginning three lines from the 14 top, you'll see a sentence which begins with 15 the word however. 16 And I just want to draw your attention 17 to that one sentence for the time being. 18 However, in no event shall company, 19 and in this case -- 20 A. Can it get highlighted? I'm sorry. 21 Q. Yes. 22 MR. TULCHIN: Maybe we can, in fact, 23 make that a little larger for Mr. Bradford. 24 THE COURT: Can you see on your screen 25 there? 10440 1 A. With all that language up there, it's 2 hard, unless it's highlighted in yellow. 3 That's great. 4 Q. You got it? 5 A. Yeah. 6 Q. So here the company refers to 7 WordPerfect, Mr. Bradford. Can we agree on 8 that? 9 A. Yes. 10 Q. Okay. And it says, however, in no 11 event shall company -- that is, WordPerfect -- 12 disclose the product or related information to 13 the development teams of any operating system 14 products, including personal NetWare, Novell 15 DOS development (DR-DOS), et cetera. 16 And that's a clause that's similar to 17 the one we saw in 3628? 18 A. Yes. 19 Q. And again this is more or less 20 standard in these nondisclosure agreements 21 pertaining to betas, that one company that's 22 giving a beta to a competing company for 23 testing doesn't want that competing company to 24 actually provide the beta copy to the 25 development teams that are making products that 10441 1 compete with the company that owns the beta; 2 fair enough? 3 A. As a very general proposition, I would 4 agree with that. 5 Q. All right. 6 MR. TULCHIN: May I approach, Your 7 Honor? 8 THE COURT: Yes. 9 Q. I'm handing you Plaintiffs' Exhibit 10 2132. And this is meeting minutes from a 11 meeting of August 18, 1994. 12 MR. TULCHIN: We offer this, 13 Plaintiffs' Exhibit 2132. 14 MS. CONLIN: Your Honor, we have no 15 objection to the document. It's a duplicate. 16 It is our document so we like it. But the -- 17 but there's no foundation for its use with this 18 witness. 19 THE COURT: It's admitted. 20 MR. TULCHIN: Thank you, Your Honor. 21 Q. Just one question about this, 22 Mr. Bradford. 23 MR. TULCHIN: And maybe we could show 24 the first page and -- up to Point Number 2. 25 Q. This is meeting minutes of a meeting 10442 1 called by Dave Miller; correct? 2 A. It appears to be that. 3 Q. And it's dated August 18, '94, and it 4 shows that there was a meeting in Provo, Utah; 5 correct? And I guess Redmond too? 6 A. Looks like a conference call perhaps. 7 Q. Right. 8 A. So there's -- Walnut Creek is actually 9 in northern California. 10 Q. Oh, I see. 11 A. Provo, Utah. Redmond, Washington. 12 Q. Okay. And Item 2 says, the beta 13 agreement has been signed and copies for 14 everyone on the list will go out Fed Ex today. 15 Do you know which beta agreement this 16 refers to? 17 A. I don't. 18 Q. Do you know whether this was an 19 agreement for Novell to get a beta of Chicago? 20 Is that what is being referred to? 21 A. I don't know. 22 Q. Okay. And actually, I do want to ask 23 you one other question about this document. 24 MR. TULCHIN: If we could look at the 25 paragraph numbered six. 10443 1 Q. Microsoft asked why they had not 2 received a beta copy of 4.1 since it began 3 shipping as of August 15, 1994. 4 Now, is it your understanding from 5 looking at this document, Mr. Bradford, that 6 4.1 refers to the NetWare product that Novell 7 was selling? 8 A. Yes, I think that's right. 9 Q. So Microsoft was asking why Microsoft 10 hadn't received a beta copy of NetWare 4.1; 11 correct? 12 A. Yes, that appears to be the question. 13 Q. And apparently, according to these 14 meeting minutes, it was explained that we are 15 not doing our mass beta ship until September 16 and that Microsoft will get a copy of the beta 17 then. 18 And then it says, and we will do about 19 an eight-week cycle. 20 Do you see that, sir? 21 A. Yes. 22 Q. Do you understand, Mr. Bradford, that 23 it's common that beta versions of various 24 software products are sent out to the 25 recipients on various cycles? And here it 10444 1 refers to an eight-week cycle. Would that be 2 more or less common and acceptable? 3 A. Sure. 4 Q. Thank you. 5 MR. TULCHIN: May I approach the 6 witness, Your Honor? 7 THE COURT: You may. 8 Q. I want to hand you, Mr. Bradford, 9 Defendant's Exhibit 2494. 10 And we talked about Mr. Jones 11 yesterday. Mr. Richard Jones was a software 12 engineer, right, at Novell? 13 A. Correct. 14 Q. And this is at the top an E-mail from 15 him dated January 13, 1995. 16 MR. TULCHIN: We offer this document, 17 Your Honor. 18 MS. CONLIN: No objection. 19 THE COURT: 2494? 20 MR. TULCHIN: Yes, sir. 21 THE COURT: It's admitted. 22 Q. And if we look at this, Mr. Bradford, 23 at the very top the E-mail from Mr. Jones says, 24 yes, we discovered that. 25 And to put some context in this, maybe 10445 1 we ought to show the whole thing. 2 Mr. Jones had sent an E-mail to Ben 3 Hendrick. He was at Novell; correct? 4 A. That's right. 5 Q. And then it goes on to say, Jonlu. Is 6 that Jon Ludwig at Microsoft? 7 A. Where do you see Jon -- oh, I see 8 Jonlu. 9 Q. Yeah, I'm looking at the E-mail of 10 January 12 now, towards the bottom. 11 A. Okay. So from Richard Jones to Ben 12 Hendrick, Jodyg, Jonlu. I do not know Jonlu, 13 Jon L-u. 14 Q. Do you see Bobkr? Do you think that's 15 Bob Kruger at Microsoft? 16 A. Yes, that would be my guess. He was 17 the Microsoft representative that worked with 18 the name that's next to his from Novell, Dave 19 Miller. 20 Q. Okay. And from this E-mail, can you 21 tell, sir, whether or not Novell had a beta 22 version of Chicago, Windows 95, on January 12, 23 1995? 24 A. John. So this is from Richard Jones 25 to John. 10446 1 I received the Build 306 CD this 2 afternoon. Thanks. We'll put it up on our 3 server for our team to install tonight. 4 I did get asked if this build requires 5 a beta ID and password as with Build 224. If 6 so, could you please send us that info. 7 So I don't know if you would classify 8 this as a classic beta, but it appears that 9 some form of a program was exchanged. 10 Q. Okay. And then the E-mail at the top 11 says preliminary feedback from the team -- and 12 this is written by Mr. Jones, the software 13 engineer at Novell -- is that it is noticeably 14 more stable than 224. Good work. 15 Do you see that, sir? 16 A. Yes, I do. 17 Q. Does this appear to be an example of 18 Microsoft and Novell cooperating when it comes 19 to the beta versions of Windows 95? 20 A. In this particular instance, yes. 21 Q. Okay. 22 MR. TULCHIN: May I approach the 23 witness, Your Honor? 24 THE COURT: You may. 25 Q. I'm handing you Defendant's Exhibit 10447 1 2508. 2 Now, this contains two E-mails, one 3 from Mr. Stanton at Microsoft and the other 4 from Dave Miller of Novell, to Mr. Stanton. Do 5 you see that, sir? 6 A. Yes. 7 MR. TULCHIN: We offer Exhibit 2508, 8 Your Honor. 9 MS. CONLIN: No objection. 10 THE COURT: It's admitted. 11 Q. Now, Mr. Bradford, just briefly. 12 This is a little later now in January. 13 The E-mails are dated January 24th and January 14 25th, and the prior E-mails were from the 12th 15 and 13th. 16 And the E-mail from Mr. Miller of 17 Novell to Mr. Stanton -- I won't read it all, 18 but he's asking for access to Microsoft's 19 CompuServe forum for Win 95. 20 Do you see that, sir? 21 A. Yes. 22 Q. And then at the bottom, he says, can 23 we do this for this particular case? I 24 understand your sensitivity to allowing 25 everyone access, Dave. 10448 1 Do you see that, sir? 2 A. Yes. 3 Q. Do you understand this E-mail when it 4 talks about sensitivity to allowing everyone 5 access to be a reference to the provision in 6 the contracts, the type of provision in the 7 beta contracts that we looked at earlier where 8 Novell and WordPerfect had agreed that people 9 working on DR-DOS should not get a beta version 10 of Chicago? 11 A. No. I think that would be an 12 overstatement. 13 Q. All right. And then you see 14 Mr. Stanton's response to Mr. Miller at the 15 top, January 24th. 16 And I must say it's a little confusing 17 because normally we see E-mails with the first 18 one at the bottom and the second one at the 19 top, but here the dates don't quite match that, 20 and I just want to make sure I point that out 21 to you because I'm not sure which is first and 22 which is second. The one at the top has the 23 date of January 24th. 24 Mr. Stanton says to Mr. Miller, the 25 private E-mail support provided directly by our 10449 1 Windows 95 development team is the highest 2 level of support available, and we will 3 continue to focus our support for your Windows 4 client development this way. 5 Now, when it talks about Windows 6 client development, do you have any 7 understanding as to what that refers to, 8 Mr. Bradford? 9 A. Let's see. So we're at the top now. 10 The private E-mail support provided 11 directly by our Windows 95 development team -- 12 so that's the Microsoft team. 13 Q. Right. 14 A. -- is the highest level of support 15 available. 16 So this is Paul telling this to Dave 17 Miller. 18 And we will continue, says Paul, to 19 focus our support for your Windows client 20 development this way. 21 And so what that is talking about, to 22 the best of my knowledge sitting here today, is 23 Novell had a product called the NetWare 24 operating system and it built a client for a 25 user interface. And I think it was important 10450 1 that that Novell client interoperate with the 2 Windows operating system. 3 Q. And Mr. Stanton is saying to Mr. 4 Miller, this is the highest level of support 5 available. 6 Is there any reason that you know of 7 to doubt that that was the highest level of 8 support available to a software developer like 9 Novell? 10 A. I have no reason to doubt Paul 11 Stanton's remarks. I don't know Paul, but -- 12 Q. Okay. 13 MR. TULCHIN: May I approach the 14 witness, Your Honor? 15 THE COURT: You may. 16 Q. I'm handing you Plaintiffs' Exhibit 17 2274, and we're now into April 1995. Little 18 bit later in the year. 19 MR. TULCHIN: Your Honor, we offer 20 Plaintiffs' Exhibit 2274. 21 MS. CONLIN: I think, Your Honor, it's 22 already admitted. 23 MR. TULCHIN: Oh, it may be. 24 MS. CONLIN: But if not, we have no 25 objection. 10451 1 THE COURT: Let me check. 2 Very well. It's admitted. 3 MR. TULCHIN: Thank you. 4 Q. Mr. Bradford, Exhibit 2274 is just one 5 page, and there are two E-mails from April 6 1995; correct? 7 A. Correct. 8 Q. And the bottom one from Ben Hendrick 9 at Novell goes to I guess you'd say an alias 10 called Novsup, N-o-v-s-u-p, at Microsoft.com. 11 Do you know what that referred to or 12 who the recipients were under that alias? 13 A. No, I have no idea. 14 Q. You'll see that Mr. Hendrick -- 15 Mr. Hendrick, of course, was with Novell; 16 right? 17 A. Yes, he was. 18 Q. And now we're in April of '95, and the 19 subject is updated Windows 95 builds. 20 And he says, in the spirit of getting 21 regular updates as they become available, I 22 have talked to several Novell external 23 customers and ISVs who received Build 437 24 CD-ROMs and are anticipating Build 440. 25 And I'll skip a little bit. 10452 1 And then he asks, is it possible to 2 have you send the latest build to Richard 3 Jones? 4 Now, there's more, but I want to 5 concentrate on the answer that he gets from Jon 6 Ludwig at Microsoft. 7 MR. TULCHIN: If we could show that. 8 Q. That's later the same day; correct? 9 April 7, 1995, at 10:18 a.m., less than two 10 hours later? 11 A. Okay. 12 Q. And Mr. Ludwig says, you should 13 understand a little about our processes. 14 We send out a lot of intermediate 15 builds in very small batches to address 16 specific bugs that people have raised. The 17 people that get these builds are the ones that 18 have raised the specific bugs. The process is 19 very automated. 20 I just want to stop here. 21 Was it your understanding with the 22 normal process of distributing beta versions of 23 software that not every so-called build went to 24 every beta tester? 25 A. That's probably right. I don't know. 10453 1 You've asked me what's typical out there, and 2 I'm not a software engineer -- 3 Q. I understand. 4 A. -- distributing betas back and forth, 5 so I really don't have a good answer for that. 6 Q. Well, let me be more specific then. 7 Do you know whether Novell itself when 8 it distributed beta versions, let's say of 9 Novell NetWare, sent every build to every 10 single beta tester? 11 A. I think what you do in general in the 12 software industry is you would send a beta out 13 to a small group of people initially. Maybe 14 that's the alpha release or the prebeta release 15 or the beta release. That these releases go 16 out to a small group of people. 17 And then as you get feedback from 18 those people, then you would send out another 19 release, perhaps to a broader set of people. 20 So that's in response, I hope, to your 21 question. 22 Q. Okay. But looking again at this first 23 paragraph of Mr. Ludwig, he goes on to say, we 24 don't broadly distribute these builds to the 25 entire beta program, so you will absolutely 10454 1 hear about people getting builds more current 2 than yours. 3 The more active you are on bug filing, 4 though, the more frequently you will get a 5 build. Honestly, we haven't seen a lot of bug 6 filings from Novell. 7 Now, is this consistent with your 8 recollection of what was going on at the time 9 in April '95 when it comes to Microsoft sending 10 betas to Novell? 11 A. Well, my recollection is that what's 12 extraordinary about these is that these go over 13 a four- or five-year period that both companies 14 have hundreds of products, especially Microsoft 15 had hundreds of products. Novell had, you 16 know, let's say 50 products. 17 And I would think that there would be 18 a lot more of these beta agreements if, in 19 fact, the companies were exchanging lots of 20 betas. 21 So, you know, these are -- relate to 22 specific instances where there was cooperation. 23 Q. Okay. And this is an example of 24 cooperation, Plaintiffs' Exhibit 2274; is that 25 correct? 10455 1 A. It appears to be, yeah. 2 Q. And then just one last point here. 3 We have Novell and a lot of other ISV 4 partners on about a biweekly regular 5 distribution schedule outside of the above 6 process. 7 Do you see that? 8 A. Yes. 9 Q. Was this your understanding that 10 people at Novell were getting betas for Windows 11 95 as did other ISV partners on about a 12 biweekly schedule? 13 A. Well, it looks like if you read the 14 next sentence, it says that we are on daily 15 builds at this point and have been for some 16 time. It doesn't surprise me that the last 17 build you had was 326. You were scheduled to 18 get 340 sent out probably today. 19 So it sounds like some people were 20 getting daily builds and others were getting 21 biweekly builds. That's the way I read that. 22 Q. Biweekly would be, let's say -- 23 A. Every other week. 24 Q. Yeah, every 14 days, and 326 and 340 25 is 14. So if there's a build every single day, 10456 1 if there is, then you'd get it each 14th build; 2 correct? 3 A. Unless you were on the schedule 4 getting one 327, 328, 329, 335. I don't know. 5 Q. Right. Well, I think what Mr. Ludwig 6 says in his E-mail is the people who file bug 7 reports get the specific builds that respond to 8 their bug reports; correct? 9 A. Yes. 10 Q. And what he also says is that Novell 11 and a lot of other ISV partners are on a 12 biweekly schedule; correct? 13 A. Yes, I see that. 14 Q. Do you have any reason to doubt that 15 that's what was going on in April of 1995? 16 A. No, not as it relates to this specific 17 E-mail and build for 326, whatever that is. 18 MR. TULCHIN: May I approach, Your 19 Honor? 20 THE COURT: Yes. 21 Q. Mr. Bradford, I hand you Defendant's 22 Exhibit 2499. This is now a little later in 23 April, April 27, 1995. 24 MR. TULCHIN: And we offer this 25 document, Your Honor. 10457 1 MS. CONLIN: No objection. 2 THE COURT: It's admitted. 3 Q. Again, this is one page, and at the 4 top you'll see there's an E-mail from Richard 5 Jones to Dave Miller and Ben -- I think it's 6 Ben Hendrick. Does that seem right? Ben 7 H-e-n-d? 8 A. Yes, that looks like it would be Ben 9 Hendrick. 10 Q. Right. And just going down a little 11 bit, if we could, there's an E-mail in the 12 middle which says -- it looks like it's from 13 Yvesm, Y-v-e-s-m, at Microsoft -- you will 14 receive Build 450 within two days as well. 15 And then Mr. Hendrick right above that 16 says, E-mail I got from Microsoft. I did not 17 see you guys on the CC line. 18 And then just above that, again, is 19 the E-mail from Mr. Jones to Miller and 20 Hendrick April 27, 1995. 21 Do you recall having seen this before, 22 sir? 23 A. No. 24 Q. Well, Mr. Jones says, we got it a 25 couple of days ago. 10458 1 And that appears to be a response to 2 Mr. Hendrick when he says I did not see you 3 guys on the CC line; right? 4 A. Okay. Maybe walk me through that 5 again, but -- 6 Q. Well, just below that, Mr. Hendrick 7 had said, E-mail I got from Microsoft. That 8 referred to the E-mail from Yvesm on April 24, 9 saying you will receive Build 450 within two 10 days? 11 A. Can I take a second to just read the 12 whole E-mail correspondence so I -- 13 Q. If I go too fast and you need time, 14 just let me know. 15 A. In this particular instance, you're 16 moving pretty quickly. 17 Q. Sorry. 18 A. Okay. 19 Okay, so this appears to be a series 20 of correspondence between Ben Hendrick and 21 someone by the name of Yves at Microsoft and 22 started April 21st, 1995. Ben sends an E-mail 23 to Yves. 24 Yves responds, you will receive the 25 Build 450 within two days. 10459 1 And I'm going from bottom to top now. 2 And Ben does an FYI, I believe to 3 Richard Jones probably in engineering, said 4 hey, look at this E-mail I got from Microsoft. 5 I did not see you guys on the CC line. So he's 6 providing them the information. 7 Q. Right. 8 A. And then Richard responds to Ben, we 9 got it a couple of days ago. 10 So now this is Richard's 11 correspondence of April 27th. So probably on 12 or about the 24th or 25th they got something 13 from Microsoft. 14 Q. Yes. And then Richard Jones, the 15 engineer, says, once a week is plenty good 16 enough for us. We really don't want it more 17 often than that. 18 Do you see that? 19 A. I do. 20 Q. Is that consistent with your 21 understanding that the engineers at Novell 22 didn't want betas more than once a week? 23 A. Well, no. This relates to a very 24 specific product, and it could be product 25 specific. Maybe they want the Windows Chicago 10460 1 beta every day. Maybe they want Build 330 that 2 we referenced earlier, you know, once a week, 3 and maybe they wanted some other things once 4 every two weeks. It would be dependent on the 5 circumstances and where both parties are at in 6 their respective product development. 7 Q. Okay. But in your last answer, you 8 were sort of making some assumptions or maybe 9 some guesses about what was going on? Because 10 I want to know whether you have any specific 11 recollection about this. 12 A. Of this document? 13 Q. Yes, and what was going on -- 14 A. No. 15 Q. -- around April 27, 1995. 16 A. Let's see, that's a very general 17 question. 18 Do you mean do I know what was going 19 on between Novell and Microsoft? 20 Q. With respect to the provision by 21 Microsoft of Windows 95 betas to Novell, that's 22 the subject. 23 A. I don't have any specific recollection 24 of this E-mail exchange or in general of that 25 particular topic that you're addressing. 10461 1 Your question to me said was once a 2 week enough, and I responded that sometimes 3 daily would be great, sometimes once a week 4 might be great, sometimes every two weeks might 5 be fine. It just depended on where the 6 respective parties were in their product 7 development. 8 Q. All right. Well, one last thing about 9 this document. 10 Mr. Jones concludes his E-mail to 11 Mr. Miller and Mr. Hendrick by saying, I need 12 to emphasize to you guys that from our 13 perspective, Microsoft has been very -- all 14 capital letters -- responsive and supportive 15 since January 1995. 16 Now, does this appear to be another 17 instance where Microsoft is cooperating with 18 Novell? 19 A. Yes. And I think what's most 20 interesting there is that very responsive and 21 supportive since January of 1995. In other 22 words, prior to January of 1995 there was 23 definitely a perception that they were not 24 being cooperative. 25 Q. Of course it doesn't say that, you're 10462 1 adding that? 2 A. Yes, I am. 3 MR. TULCHIN: May I approach, Your 4 Honor? 5 THE COURT: You may. 6 Q. Let me hand you Defendant's Exhibit 7 2502. And this at the top -- this has several 8 pages. It's three pages, Mr. Bradford, but at 9 the top its an E-mail from David Thompson at 10 Microsoft to Mr. Hendrick and other people. 11 Do you see that, sir? 12 A. Yes, I do. 13 MR. TULCHIN: We offer this document, 14 Your Honor. 15 MS. CONLIN: May I voir dire the 16 witness, Your Honor? 17 THE COURT: You may. 18 VOIR DIRE EXAMINATION 19 BY MS. CONLIN: 20 Q. Mr. Bradford, you've been very patient 21 about this. 22 None of these documents that you have 23 been shown over the last some time have you as 24 either the person who wrote the E-mail or on 25 the list of those who received the E-mail; is 10463 1 that correct? 2 A. That's correct. 3 Q. And these are E-mails going between 4 the engineering department or the development 5 department of one company to another company; 6 correct? 7 A. That's right. 8 Q. And would you in the ordinary course 9 of your business have anything whatsoever to do 10 with this kind of an exchange? 11 A. No. 12 Q. And would you in the ordinary course 13 of your duties to Novell even see this kind of 14 thing? 15 A. No, not typically. 16 MS. CONLIN: Your Honor, we do not 17 object to the exhibit, but we believe that 18 there is no foundation for the continued use of 19 documents of this sort with this witness who 20 has not seen them and who is not an engineer. 21 THE COURT: Objection is overruled. 22 It's admitted. 23 CROSS-EXAMINATION (CONT'D) 24 BY MR. TULCHIN: 25 Q. Mr. Bradford, looking at Exhibit 2502, 10464 1 and I want to focus your attention towards the 2 top. 3 The date of the first E-mail is 4 October 9, 1995. Now, by this time, Windows 95 5 has been released; right? Because we know it 6 was on your anniversary in 1995. 7 A. That's right. 8 Q. Okay. That was in August. Now we're 9 in October. 10 And just below that there's an E-mail 11 from Mr. Jones, the same Mr. Jones who is a 12 software engineer at Novell, to Jon Ludwig at 13 Microsoft and Yves Michali at Microsoft and 14 also to Mr. Hendrick and other people. And 15 it's dated Monday, October 9, 1995. 16 Do you see that? 17 A. Yes, I do. 18 Q. And he writes to Ben. That must be 19 Ben Hendrick; right? 20 A. Yes. 21 Q. And he says, I had asked Yves Michali 22 for a copy back in July and Jon Ludwig 23 responded and declined the request at that time 24 because they were working out some internal 25 details. I don't believe we have been 10465 1 discriminated against. 2 Do you see that, sir? 3 A. I do. 4 Q. And then below it says, we just 5 haven't asked since July, I will ask again. 6 Right at the bottom. 7 A. Yes, I see that. 8 Q. Now, in connection, Mr. Bradford, with 9 your testimony on direct examination, that 10 Novell you say wasn't getting the betas as 11 frequently as some other companies, did you 12 have occasion to look at this E-mail from 13 Mr. Jones which says I don't believe we have 14 been discriminated against? 15 A. No, I have never seen this E-mail. 16 And, again, it relates to a specific point in 17 time to a specific beta. 18 MR. TULCHIN: May I approach the 19 witness, Your Honor? 20 THE COURT: You may. 21 Q. Mr. Bradford, I'm handing you 22 Defendant's Exhibit 814. 23 And the first page is a fax cover 24 sheet, or so it appears. And if you turn to 25 the second page, there's a memorandum from 10466 1 Mr. Sobin at the law firm of Ablondi & Foster 2 to you of October 21, 1992; is that correct, 3 sir? 4 A. Yes. 5 Q. And you received this memorandum from 6 your lawyers on or about that time? 7 A. To the best of my recollection, yes. 8 Q. I just want to ask you one thing about 9 Exhibit 814, but before I do, let me ask you 10 the general question. 11 Do you recall in 1992 that Dick 12 Williams, who had been president of DRI -- and 13 remember, I think you testified that he left 14 Digital Research in or around April of '92, he 15 resigned? 16 A. That's right. 17 Q. Do you recall hearing that 18 Mr. Williams believed that at least some of the 19 problems that had caused the deteriorating 20 sales of DR-DOS were Novell's fault? 21 A. He may have said that that was a 22 factor. It's not particularly riveting in my 23 mind today, but Dick may have said something -- 24 he was frustrated. 25 Again, during this time period Novell 10467 1 was keeping kind of arm's length from this 2 company that we had purchased, and so Dick may 3 have had a perception that there was fault on 4 Novell's part without having access to all the 5 facts and information about what Novell was 6 doing and the discussions we were having at the 7 time with Microsoft. 8 Q. Well, if I could just ask you to look 9 briefly at the second page. It's the third 10 page of the document, the second page of the 11 memo from Mr. Sobin to you, and just -- I want 12 to see if this refreshes your recollection. 13 If you could just read to yourself the 14 paragraph that is the first full paragraph on 15 the second page. It starts there are obvious. 16 Do you see that? 17 A. Okay. 18 Q. And in particular, the sentence that 19 begins for example. 20 A. Yes. 21 Q. And my question to you, Mr. Bradford, 22 is whether this memorandum to you in October 23 1992 from Mr. Sobin refreshes your recollection 24 that at that time, Dick Williams, the former 25 president of Digital Research, had expressed 10468 1 the belief that at least some of the problems 2 that led to Novell's deteriorating sales had 3 more to do with Novell than Microsoft? 4 A. It refreshes my recollection that Dick 5 thought that some of the problems with respect 6 to deteriorating sales related to Novell's 7 problem and not necessarily Microsoft's. 8 Q. Okay. Thank you. 9 MR. TULCHIN: May I approach the 10 witness, Your Honor? 11 THE COURT: You may. 12 Q. I hand you, sir, Defendant's Exhibit 13 2535 entitled Novell business applications 14 business plan. 15 Do you recall having seen this before, 16 sir? 17 A. No, not immediately it doesn't come to 18 mind, but I may have seen it before. 19 Q. Do you recognize this document as a 20 Novell business application business plan 21 written around April 3, 1995? 22 A. Yes, that's -- that appears to be 23 accurate. 24 It says 1996 to 1998 at the top, so 25 that confused me for a second. But it appears 10469 1 to be someone's writing on April 3, 1995, 2 projecting into the future what we need to do 3 with respect to our applications division. 4 MR. TULCHIN: Your Honor, Microsoft 5 offers into evidence Defendant's Exhibit 2535. 6 MS. CONLIN: No objection. 7 THE COURT: It's admitted. 8 Q. I just want to look at the first page 9 very briefly, Mr. Bradford. 10 As I think you were just saying, this 11 is a business plan, and it does say draft on it 12 at the bottom, draft Novell confidential right 13 at the bottom. 14 A. Yes. 15 Q. But it appears to have been written 16 around April 3, '95, and it pertains to 17 Novell's applications products; correct? 18 A. It appears to be that. 19 Q. So the applications products would be 20 -- it's not DR-DOS. It's WordPerfect and 21 Quattro Pro and maybe suites as well, is that 22 what you would say? 23 A. Yes, uh-huh. 24 Q. All right. And were these kinds of 25 business plans -- you see right at the top it 10470 1 says Novell business applications business 2 plan? Were these type of business plans 3 prepared at Novell from time to time? 4 A. Yes. 5 Q. And if you need time to look at 6 specific portions of this, Mr. Bradford, please 7 take it. 8 But I want to just go up a few pages 9 into this document, and you'll see Roman number 10 III, marketplace analysis, which begins on the 11 page that's numbered page 4. 12 Do you see that, marketplace analysis? 13 A. Yes, I see that. 14 Q. And it talks about customer market 15 analysis, and then if you go all the way into 16 page 8 -- I'm sorry, it's page 9, at the very 17 top, it says, company weaknesses that hinder 18 Novell business applications. 19 Do you see that, sir? 20 A. I do. 21 Q. And in that section, the author of 22 this business applications business plan sets 23 forth weaknesses that are Novell weaknesses. 24 When he says company, he or she, he 25 says company, that refers to Novell; correct? 10471 1 A. That's correct. 2 Q. And then it has a list of Novell 3 weaknesses that hinder Novell business 4 applications. And again we're talking about 5 WordPerfect, we're talking about Quattro Pro, 6 and also suites of applications; is that right? 7 A. All right. 8 Q. And it says lack of ownership on the 9 desktop. Then it says weak development tools. 10 Were development tools important in 11 the success of business applications in 12 competing in the marketplace? 13 A. That's better -- I'm sure they were a 14 factor and important, but better ask a software 15 engineer. 16 Q. Okay. The third bullet point says 17 weak developers' program which has atrophied 18 over the last few years. 19 Do you recall at the time that the 20 developers' program had atrophied at Novell? 21 A. I don't recall that. 22 Q. And then the next point says, weak 23 vis-a-vis Microsoft in perception for corporate 24 strategy, vision, and ability to develop 25 software. 10472 1 Do you see that? 2 A. Yes, I see that. 3 Q. In your role as a member of the 4 executive committee at Novell, was it your 5 understanding at the time in 1995 that there 6 was nothing more fundamental when it comes to 7 success in the software business than corporate 8 strategy, vision, and ability to develop 9 software? 10 A. That was important, certainly. 11 Q. And then it goes on a couple more 12 bullet points, lack of perception among 13 customers that Novell is a corporate strategic 14 partner like Microsoft. 15 Was it your understanding as a member 16 of the executive committee that that was 17 important too? 18 A. I recall it being an important factor, 19 but I don't recall that there was a perception 20 among customers that Novell is a -- was not as 21 good a corporate strategic partner as 22 Microsoft. 23 Q. Okay. Just going down two more -- 24 A. I think it's -- well, we don't know 25 who wrote this or -- right? I don't know who 10473 1 wrote this. 2 Q. Fair enough, Mr. Bradford. 3 A. Right, okay. 4 Keep going. 5 Q. Sure. I'm going to just go to a 6 couple more of these type of things. 7 But two more bullet points down, we 8 talked yesterday about the sales force at 9 WordPerfect, and you'll remember that you 10 mentioned on direct that a number of members of 11 the sales team from the WordPerfect 12 organization had been laid off at the time that 13 Novell bought WordPerfect; right? 14 A. Yes. 15 Q. And here the author of this memorandum 16 says, over 50 percent of sales force does not 17 understand applications, changing but slow. 18 Over 95 percent of sales force does not 19 understand Quattro Pro or electronic publishing 20 tools. 21 Now, that sounds pretty basic, does it 22 not, for a company trying to sell software that 23 your sales force understand the products? 24 A. That would be important. 25 Q. And then if we can look at the bottom 10474 1 half of the page, the top half was a reference 2 to company weaknesses, and the bottom half 3 talks about division (group) weaknesses. 4 Do you see that? 5 A. Yes, I do. 6 Q. And the first bullet point says, third 7 to suite market. Microsoft has enormous 8 momentum. 9 Microsoft was the first to come out 10 with a suite; correct? 11 A. I'm not sure. 12 Q. Did you recall that -- 13 A. I'm not sure. They were certainly one 14 or two. I don't know if someone came out with 15 a suite before Microsoft. 16 Q. Okay. 17 A. But this appears that this author, 18 whoever it is, says that we were third to suite 19 market. 20 Q. Right. And the next bullet point 21 says, still recovering from WordPerfect 6.0 for 22 Windows which was perceived as a slow and buggy 23 product. 24 Do you recall that, that the 25 WordPerfect 6.0 product was perceived in the 10475 1 marketplace as slow and buggy? 2 A. No, but I'd have to think that if it 3 was, it related to some extent to the fact that 4 we couldn't get betas application programming 5 interfaces, et cetera, from Microsoft. 6 Q. And let's go down a little bit 7 further. 8 Weak development environment for 9 Perfect Office. Now, Perfect Office was the 10 Novell suite that was supposed to be competing 11 with Microsoft Office; correct? 12 A. That's correct. 13 Q. What is this a reference to, if you 14 know, sir, weak development environment? 15 A. I don't know sitting here today what 16 this author had in mind there. 17 Q. All right. Towards the bottom of the 18 page, it says, weak at localization compared to 19 Microsoft and Lotus. 20 And I just want to pause on this. 21 Is localization a reference to the 22 fact that in countries around the world, 23 software is written for the language that's 24 used in those particular countries? 25 A. That's right. 10476 1 Q. So let's say in portions of South 2 America, your software product would actually 3 be in Spanish? 4 A. That's right. 5 Q. And localization just means you're 6 writing for the local language? 7 A. That's right. 8 Q. And was it your recollection around 9 1995 that Microsoft and Lotus both were much 10 better at putting their English version 11 software products in local languages than 12 Novell had been? 13 A. No, I don't have an understanding on 14 that. 15 Q. You don't have an understanding one 16 way or another? 17 A. That's right. 18 Q. Okay. 19 MR. TULCHIN: Your Honor, I don't know 20 if it's too early for the break, but this is a 21 good time for me if it suits the Court. 22 THE COURT: Sure. We'll take our 23 recess at this time. 24 Remember the admonition previously 25 given. We'll be in recess for ten minutes. 10477 1 Leave your notebooks here. Thank you. 2 (A recess was taken from 9:50 a.m. 3 to 10:14 a.m.) 4 THE COURT: Everyone else may be 5 seated. 6 Mr. Bradford, you're still under oath. 7 MR. TULCHIN: May I approach the 8 witness, Your Honor? 9 THE COURT: You may. 10 BY MR. TULCHIN: 11 Q. Mr. Bradford, I'm handing you what 12 we've marked as Defendant's Exhibit 6787A. And 13 these are pages from -- it's not the full 14 document, but certain pages from a Form 10-K 15 filed with the Securities and Exchange 16 Commission by Novell. 17 Do you recognize this, sir? 18 A. Yes, in general. 19 Q. Could you explain to the jury what a 20 Form 10-K is? 21 A. When there is a -- let's see, so the 22 10-Q -- so this is an annual report. 23 Q. Yes, sir. 24 A. An annual report to stockholders about 25 the company's work. 10478 1 Q. And this particular one, Mr. Bradford, 2 was for the Novell's fiscal year ended October 3 29, 1994; correct? 4 A. I'm looking to find that date. I'm 5 sorry. 6 Q. Just on the first page under the words 7 Form 10-K, there's three lines, and the third 8 one says for the fiscal year ended October 29, 9 1994? 10 A. I'm looking above that, and this looks 11 like as of December 31, 1994. 12 Q. Well, let me back up one step. 13 Novell's fiscal year at the time ended 14 in late October; correct? 15 A. Yes, that's right. 16 Q. And I know there's a reference to the 17 number of outstanding shares as of December 18 31st -- 19 A. Right. 20 Q. -- '94. 21 A. Okay. 22 Q. But this is for the fiscal year ended 23 late October, 1994; correct? 24 A. That's right, correct. 25 MR. TULCHIN: Your Honor, Microsoft 10479 1 offers Defendant's Exhibit 6787A. 2 MS. CONLIN: No objection. 3 THE COURT: Admitted. 4 Q. And, Mr. Bradford, the Form 10-K is 5 prepared by Novell; is that right? 6 A. That's correct. 7 Q. And as the general counsel of Novell 8 at the time, would it have been part of your 9 duties and responsibilities to review at least 10 portions of the Form 10-K to make sure that 11 they were accurate and appropriate? 12 A. Yes. 13 Q. Did you review the portions of the 14 Form 10-K, the pages that make up Defendant's 15 Exhibit 6787A? 16 A. I don't know sitting here today if I 17 reviewed these particular ones, but typically, 18 I would peruse the entire 10-K. 19 Q. To make sure it was accurate before it 20 was filed; is that right? 21 A. That's right. 22 Q. What I want to do for the moment is to 23 -- well, let's look just at the first page for 24 a minute. 25 And at the top it says, Securities and 10480 1 Exchange Commission, and that's a part of the 2 federal government in Washington; correct? 3 A. That's right. 4 Q. And then Form 10-K, and just under 5 that, there are those three lines I was 6 referring to, annual report -- there's an X 7 there -- annual report pursuant to Section 13 8 or 15D of the Securities Exchange Act of 1934, 9 for the fiscal year ended October 29, 1994. 10 And then I want to direct your 11 attention to page 9 of the document. It's the 12 fourth page of the exhibit, again, 6787A. 13 The first full paragraph starts, in 14 the market for Microsoft Windows word 15 processing applications. 16 Do you see that? 17 A. Yes, I do. 18 Q. I know this is a little -- the type -- 19 the print face is very small, but this 20 particular paragraph talks about applications 21 products like suites and word processing 22 applications and spreadsheet applications; 23 correct? 24 A. Yes. And so this is under -- just to 25 get the document right, this looks like under 10481 1 the competition section. 2 Q. Correct. 3 A. Okay. 4 Q. Yes, on page 8, the previous page, the 5 section is entitled competition. 6 A. Right. 7 Q. And I want to direct your attention in 8 this paragraph, about halfway down there's a 9 sentence that begins in addition. 10 In addition, the company's principal 11 competitors, including Microsoft, are combining 12 a number of application programs in a bundle or 13 suite for sale as one unit or arranging with 14 hardware manufacturers to preload application 15 programs on new computers. 16 Do you see that, sir? 17 A. Right. 18 Q. And at the time, of course, by the end 19 of -- sorry, I think we talked yesterday about 20 the fact that as of October '94, Novell had not 21 yet come out with its suite that competed in 22 this market; correct? 23 A. Yes, I think that's accurate. 24 Q. And then it goes on to say, the price 25 for a bundle or suite is typically 10482 1 significantly less than the price for 2 separately purchased applications and many end 3 users are likely to prefer the bundle or suite 4 over a more expensive combination of other 5 individually purchased applications, even if 6 the latter applications offer superior 7 performance or features. 8 Do you see that, sir? 9 A. Yes. 10 Q. And is it your recollection of the way 11 your responsibilities worked at Novell at the 12 time that this is a sentence that you would 13 have reviewed and approved before Novell filed 14 the 10-K with the Securities and Exchange 15 Commission in Washington? 16 A. Well, if we had the full document 17 here, I think we would see that it's probably a 18 very lengthy one -- 19 Q. It is. I have the full one if you 20 want it. 21 A. -- with all of the attachments and so 22 forth. 23 But to say I reviewed this particular 24 sentence on that particular day, I can't 25 testify to that today. 10483 1 But typically, I would have, like I 2 said, perused the whole thing for accuracy. 3 Q. And is it, let's say, consistent with 4 your understanding today that as of 1994 the 5 statement that I just read about suites was 6 true and correct? 7 A. Yes, that's generally accurate. We 8 talked about that yesterday. 9 Q. Right. And then it says, Microsoft, 10 Lotus and the company offer bundles or suites 11 of their respective products at prices 12 significantly discounted from the prices of 13 stand-alone products. 14 Do you see that, sir? 15 A. Yes, I see that. 16 Q. And would you agree with me that 17 that's something that was good for consumers? 18 A. Yes, definitely. 19 If that were always the case, that was 20 definitely a positive for consumers. 21 Q. Okay. And looking at the last page of 22 Exhibit 6787A, would you agree that this Form 23 10-K was signed by Mr. Frankenberg, the CEO, 24 and also by the other members of the board of 25 directors of Novell? 10484 1 A. Well, looking down, you've got Bob 2 Frankenberg, who was the CEO; Jim Tolonen, who 3 was the CFO, the chief financial officer; and 4 then you had Steve Wise, who was vice president 5 of finance at the time; and then, yes, the 6 other members that have signed this were 7 members of the Novell board of directors at the 8 time. 9 Q. Thank you, sir. 10 MR. TULCHIN: May I approach, Your 11 Honor? 12 THE COURT: You may. 13 Q. I'm handing you, Mr. Bradford, 14 Defendant's Exhibit 6790A. 15 And, again, this isn't the full 16 document, this is an excerpt. If you want the 17 full document, it's in the courtroom and we'll 18 show it to you. 19 But this is the -- these are pages 20 from Novell's 1997 annual report; correct, sir? 21 A. It appears to be that. Yes, annual 22 report to our stockholders, all right. 23 Q. Right. And is the annual report 24 typically mailed out to the stockholders of 25 record of Novell? 10485 1 A. That's right. 2 Q. And that would be done once a year? 3 A. That's correct. 4 Q. Now, in this case -- oh, let me -- 5 sorry. 6 MR. TULCHIN: Your Honor, Microsoft 7 offers Defendant's Exhibit 6790A. 8 MS. CONLIN: No objection. 9 THE COURT: It's admitted. 10 Q. The first page of the exhibit, 11 Mr. Bradford, is just the cover of the annual 12 report; correct? 13 A. That's right. 14 Q. And typically the chief executive 15 officer, the CEO of Novell, during the period 16 you were general counsel would write a letter 17 to stockholders that would be included as part 18 of the annual report; correct? 19 A. That's right. 20 Q. This 1997 annual report has a letter 21 to stockholders that was signed by Doctor Eric 22 Schmidt. 23 A. Right. 24 Q. Isn't that right? 25 A. Yes. 10486 1 Q. And if we could look at the last page 2 of the document, that's Doctor Schmidt's 3 signature there, is it not? 4 A. Yes. 5 Q. And I think you testified on direct 6 that when you resigned in the year 2000, you 7 went into Doctor Schmidt's office and tendered 8 your resignation? 9 A. That's right. 10 Q. Doctor Schmidt was the man who took 11 over from Bob Frankenberg as the CEO? 12 A. Yes. There was an interim period 13 there where there was no CEO assigned, but, 14 yes. 15 Q. He was the next CEO after Mr. 16 Frankenberg? 17 A. Yes. 18 Q. Okay. And the letter that went out to 19 the stockholders as part of the annual report, 20 was this also something that you reviewed and 21 commented on before it was included and sent 22 out to the stockholders? 23 A. Yes, it was. 24 MR. TULCHIN: Could we look at the 25 second page of the document, the first page of 10487 1 Doctor Schmidt's letter, which is entitled to 2 our shareholders. 3 Q. And right at the top, Doctor Schmidt 4 says -- there's a little bit of an arrow. And 5 this is how he starts out the 1997 letter to 6 stockholders. Clarity of direction and 7 strategy are essential for software companies 8 to sustain growth. 9 Now, let me just stop there, 10 Mr. Bradford. 11 I think you and I agreed you testified 12 that clarity of direction and strategy are 13 essential for software companies. 14 A. That's right. 15 Q. And then Doctor Schmidt goes on to 16 say, the Novell that I joined in April of 1997, 17 midway through the company's fiscal year, had 18 lost touch with this simple truth. In seven 19 months we have corrected that. 20 My question to you, Mr. Bradford, is 21 whether or not you agree that as of April 22 1977 -- 23 THE COURT: '97? 24 MR. TULCHIN: What did I say, Your 25 Honor? 10488 1 THE COURT: '77. 2 THE WITNESS: We're back in college. 3 MR. TULCHIN: I'm 20 years off, and I 4 apologize to all concerned. 5 Q. I'm going to ask my question again. 6 Do you agree, Mr. Bradford, with 7 Doctor Schmidt's statement here that as of 8 April 1997, Novell had lost touch with the 9 simple truth that clarity of direction and 10 strategy are essential for Novell to sustain 11 growth? 12 A. I think it was a bit of an 13 overstatement. He's trying to communicate 14 effectively with the stockholders. But in 15 general, certainly Doctor Eric Schmidt had a 16 concern on that issue. 17 Q. And it was correct, was it not, that 18 as of 1997, Novell had lost touch with the idea 19 that clarity of direction and strategy were 20 important for its growth? 21 A. Again, I think that's an 22 overstatement. 23 MR. TULCHIN: Thank you, Mr. Bradford. 24 Nothing more on cross, Your Honor. 25 THE COURT: Very well. Redirect. 10489 1 MS. CONLIN: Thank you, Your Honor. 2 REDIRECT EXAMINATION 3 BY MS. CONLIN: 4 Q. Let's stay with this document for a 5 moment, if we could. 6 A. Okay. 7 Q. Doctor Eric Schmidt, for what period 8 of time was he Novell's CEO? 9 A. Approximately four years, five years, 10 perhaps. 11 Q. And came in '97, left in -- 12 A. 2001 or 2002. 13 Q. What is his current position, do you 14 know? 15 A. Yes. He is lucky enough to be 16 chairman and CEO of Google. 17 Q. And I have a few questions -- I better 18 not say that. I have more than a few questions 19 for you. 20 A. Okay. 21 Q. We won't cover every topic, but there 22 are some that I think deserve attention. 23 First of all, let's begin with 24 Defendant's Exhibit 6770. Do you remember, the 25 document is the Arnold & Porter list of OEMs 10490 1 who have -- 2 MS. CONLIN: May I approach, Your 3 Honor? 4 THE COURT: Yes. 5 Q. -- who have licensed the DR-DOS 6 product? 7 A. Yes, I see that. 8 Q. Do you know approximately, in this 9 time frame back in the early '90s, 10 approximately how many computer hardware 11 manufacturers there would have been in the 12 world?