"The Apple iPod iTunes Anti-Trust Litigation"

Filing 355

Declaration of David C. Kiernan in Support of 354 Reply to Opposition Declaration of David C. Kiernan in Support of Apple's Reply in Support of Motion to Dismiss or, Alternatively, for Summary Judgment [Redacted] filed byApple Inc.. (Attachments: # 1 Exhibit 1-2)(Related document(s) 354 ) (Kiernan, David) (Filed on 4/12/2010)

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EXHIBIT 1 L ::2 I N THE U N I T E D S T A T E S D I S T R I C T COURT FOR THE NORTHERN D I S T R I C T OF C A L I F O R N I A SAN J O S E D I V I S I O N 3 4 5 6 7 C-05-00037-JW "THE APPLE IPOD ITUNES ANTITRUST LITIGATION." NOVEMBER 2 3 , 2009 8 9 PAGES 1 - 58 10 11 12 13 14 15 16 17 18 19 20 21 FOR THE D E F E N D A N T S : 22 23 24 25 J O N E S DAY BY: ROBERT A . M I T T E L S T A E D T MICHAEL S C O T T 555 CALIFORNIA STREET 2 6 T H FLOOR SAN F R A N C I S C O , C A L I F O R N I A 9 4 1 0 4 I R E N E R O D R I G U E Z , C S R , CRR C E R T I F I C A T E NUMBER 8 0 7 4 L THE P R O C E E D I N G S WERE HELD B E F O R E THE HONORABLE U N I T E D S T A T E S D I S T R I C T JUDGE JAMES WARE A P P E A RAN C E S: FOR THE P L A I N T I F F S : C O U G H L I N , S T O I A , G E L L E R , RUDMAN ,s, R O B B I N S BY: BONNY SWEENEY THOMAS R . M E R R I C K 6 5 5 WEST BROADWAY SUITE 1900 SAN D I E G O , C A L I F O R N I A 9 2 1 0 1 ZELDES & HAEGGQUIST BY: HELEN Z E L D E S 6 2 5 BROADWAY, S U I T E 9 0 6 SAN D I E G O , C A L I F O R N I A 9 2 1 0 2 O F F I C I A L COURT R E P O R T E R : U . S . COURT REPORTERS 1 2 SAN J O S E , CALIFORNIA NOVEMBER 2 3 , 2 0 0 9 3 4 5 6 7 8 9 PRO C E E 0 I N G S (WHEREUPON, COURT CONVENED AND THE FOLLOWING P R O C E E D I N G S WERE H E L D : ) THE C L E R K : C A L L I N G C A S E NUMBER O S - 0 0 0 3 7 , THE A P P L E I P O D I T U N E S A N T I T R U S T L I T I G A T I O N . ON FOR V A R I O U S M O T I O N S . EACH S I D E FOR ALL M O T I O N S . THE C O U R T : BE S U F F I C I E N T BUT - MS. FIFTEEN MINUTES 10 11 12 13 14 IS 16 17 18 19 20 21 22 23 24 2S TIME? I ' M SURE T H A T ' S NOT G O I N G TO ZELDES: T H A T ' S OUR F I R S T M O T I O N . YOUR F I R S T MOTION I S FOR MORE THE C O U R T : F I R S T I N T R O D U C E Y O U R S E L V E S TO ME. MS. SWEENEY: GOOD M O R N I N G , YOUR HONOR. B O N N I E SWEENEY FOR THE D I R E C T P U R C H A S E R P L A I N T I F F S . MR. MERRICK: GOOD M O R N I N G , YOUR HONOR. THOMAS M E R R I C K ALSO FOR THE D I R E C T P U R C H A S E R PLAINTIFFS. MS. ZELDES: GOOD M O R N I N G , YOUR HONOR. HELEN Z E L D E S ON B E H A L F OF STACY SOMERS THE I N D I R E C T PURCHASER P L A I N T I F F S . MS. ROACH: GOOD M O R N I N G , YOUR HONOR. PAULA ROACH ON B E H A L F O F D I R E C T P U R C H A S E R 2 U.S. COURT REPORTERS 1 L I T I G A T I O N WHERE TIIAT EVEN THOUGH I T HAD D E V E L O P E D I T S OWN V E R S I O N OF DRM, WHEN A C O M P E T I T I V E PRODUCT APPLE DID 2 3 THAT CAME ALONG THAT COULD USE I T , 4 S O M E T H I N G TO CHANGE I T S V E R S I O N OF DRM TO M A I N T A I N THE R E L A T I O N S H I P BETWEEN THE M U S I C AND THE D I R E C T DOWNLOAD TO THE I P O D . INDIRECT WAYS TO DO I T . AND SO S H O U L D N ' T THE COURT AT L E A S T ALLOW T H I S TO PROCEED TO THE P O I N T WHERE I ABOUT THAT THROUGH D I S C O V E R Y ? I CAN LEARN MORE I AGREE WITH YOU THERE ARE S 6 7 8 9 10 11 12 13 14 IS 16 17 18 19 20 21 22 23 24 2S D O N ' T KNOW I F CHANGING THE C L A S S D E F I N I T I O N I S THE WAY - - THE ROUTE TO THAT BUT WHY S H O U L D N ' T I THAT? MR. MITTELSTAEDT: THE A L L E G A T I O N I S THAT PAY A T T E N T I O N TO A YEAR AND A HALF A F T E R THE I T U N E S M U S I C S T O R E WAS LAUNCHED, SO NOW W E ' R E UP TO OCTOBER OF 2 0 0 4 , REAL NETWORKS D E V E L O P E D SOME T Y P E OF DRM THAT M I M I C K E D FAIR PLAY. AND SO WHEN REAL NETWORKS SOLD M U S I C ON THEIR MUSIC STORE, I T WAS I N T E R P R E T E D BY THE I P O D AS A P P L E ' S F A I R PLAY DRM P R O T E C T E D M U S I C . THE WAY THEY D I D T H A T , A L L E G E D I N THE C O M P L A I N T , TO, AND T H I S I S I S REAL NETWORKS WAS ABLE D I S C E R N PART OF I N THE WORDS OF THE C O M P L A I N T , A P P L E ' S SOFTWARE C O D E , PART OF T H E I R CODE FOR THE 18 U . S . COURT REPORTERS 1 DRM. APPLE LABELS, I S UNDER A S T R I C T C O N T R A C T W I T H THE TO M A I N T A I N THE S E C U R I T Y 2 3 WAS AT THE T I M E , 4 5 O F I T S DRM F O R O B V I O U S R E A S O N S . AND SO T H I S WAS AN C O M P E T I T O R HAD B E E N A B L E T O , REVERSE ENGINEERING, OF THE S O F T W A R E C O D E . APPLE, L I K E ALL SOFTWARE M A N U F A C T U R E R S , I T S SOFTWARE F O R A V A R I E T Y O F S T A Y I N G A S T E P OR TWO AHEAD I N S T A N C E WHERE THE WHETHER BY H A C K I N G , F I G U R E OUT P A R T 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 OR O T H E R W I S E , PERIODICALLY UPDATES REASONS, FIXING BUGS, OF H A C K E R S OR W H A T E V E R . AND AS THE E V I D E N C E W I L L SHOW THAT A P P L E WAS P L A N N I N G A SOFTWARE UPGRADE AND WENT AHEAD AND INSTITUTED THAT. T H E E F F E C T O F THAT S O F T W A R E U P D A T E WAS TO BLOCK T H I S H A C K . R E A L COULD COME BACK AND TRY TO REHACK AROUND THE S O F T W A R E U P D A T E . WE ARE P R O V I D I N G D I S C O V E R Y TO THE P L A I N T I F F S ON THAT INCIDENT. THE P L A I N T I F F S HAVE AND W E ' R E WORKING ASKED F O R A 3 0 ( B ) ( 6 ) DEPOSITION, OUT THE D E T A I L S W I T H T H E M . AND I ' M C O N F I D E N T THAT A F T E R THAT D E P O S I T I O N I S TAKEN AND WHEN WE F I N I S H C O M P L E T I N G P R O D U C I N G DOCUMENTS ON T H A T , THAT I S S U E SHOULD GO 19 U.s. COURT REPORTERS 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 AWAY J U S T L I K E THE I S S U E O F C H I P D I S A B L I N G AS I T H I N K HAS GONE AWAY. T H E R E ' S ANOTHER A L L E G A T I O N I N THE C O M P L A I N T T H A T A P P L E D I S A B L E S THE P R O C E S S O R C H I P I N THE I P O D SO THAT I T W O N ' T PLAY M I C R O S O F T ' S DRM. THAT'S SIMPLY UNTRUE. THE P L A I N T I F F ' S E X P E R T S HAVE S A I D THAT THEY KNOW N O T H I N G ABOUT T H A T , GO AWAY. I F I T D O E S N ' T GO AWAY V O L U N T A R I L Y , D I S P R O V E THAT AS W E L L . FOR P U R P O S E S OF THE C L A S S D I S C U S S I O N THOUGH, YOUR HONOR, I F THE P L A I N T I F F S E V E N T U A L L Y WE'LL AND I T H I N K THAT W I L L END UP F O C U S S I N G ON T H I S REAL NETWORK HACK I N L A T E 2004, THAT HAS IMPLICATIONS, I T H I N K VERY S E R I O U S I M P L I C A T I O N S ON WHETHER THEY GET A C L A S S AND WHAT K I N D OF S C O P E O F THE C L A S S WOULD BE I F A N Y . B E C A U S E THE I S S U E O F WHO, I F ANYONE WAS HARMED BY A P P L E I S S U I N G A REGULARLY P E R I O D I C SOFTWARE U P D A T E I S S O M E T H I N G THAT H A S N ' T B E E N A D D R E S S E D BY THE P L A I N T I F F S AND I T I S C O M P L I C A T E D AND I T W O U L D N ' T GO B A C K , THE M U S I C S T O R E . THE C O U R T : YOU DO NOT HAVE CURRENTLY YOU KNOW, TO THE S T A R T O F B E F O R E THE COURT A MOTION TO D I S M I S S THE S E C T I O N 2 20 U . S . COURT REPORTERS EXHIBIT 2 htip://www.pcworlJ.com/printablc/articlc!iJ.118339/printable.html I PCWorkr ' . . .. 2;USIt·JESS ,... ~, . '" -, . '..Vindows -; WINDOWS®7 PROFESSIONAL WITH XP MODE PRE-INSTALLED. Apple Unveils Photo IPod N e w device sports a c o l o r screen, is available in 40 and 60GB versions. Peter Cohen, MacCentral.com -;-ucsday, October 2 6 , 2 0 0 4 0 2 0 0 PM PDT SAN FRANCISCO -- At a special music event featuring Bono and The Edge from rock group U2 held here this week, Apple Computer took the wraps o f f the IPod Photo, a color IPod available in 40GB or 60GB storage capacities. The company also introduced the IPod U2 Special Edition, Apple's 20GB player clad in black, equipped with a red Click Wheel and featuring engraved U2 band m e m b e r signatures. The IPod Photo is available immediately, and Apple expects the IPod U2 Special Edition to ship in mid-November. In Living Color The IPod Photo looks identical to its music capable o f displaying 65,536 colors. playing~()nly_ cousin, but it uses a 220x176-pixel resolution color screen c Apple's Auto-Sync technology, built into ITunes, makes sure that the IPod is playing the same music as ITunes, but it has been extended also to support the IPhoto software included as part o f Apple's ILife application suite--included on all shipping Macs and available for purchase separately. For Windows users, Auto-Sync supports Adobe Photoshop Elements, Photoshop Album, or the user's "My Pictures" folder, The new photo syncing capability is supported by a n e w ' release o f ITunes, version 4.7. -J The IPod Photo can display 25 color photo thumbnails at a time, and lets users scroll through their photos the same way they scroll through their music playlists. An included A V cable enables the IPod to connect directly to a TV or video projector as well--the IPod will even format the photos depending on whether your set uses the conventional 4 3 aspect ratio or the 1 6 9 format preferred by newer widescreen sets. http://www.pcworld.com/printable/article/id.118339/printable.html Apple also claims the IPod Photo sports longer battery life than previous models--the company says IPod Photo can play music for up to 15 hours continuously, or up to 5 hours while showing photo slideshows. Available now in 40GB and 60GB capacities, the IPod Photo costs $499 and $599 respectively. ITunes Updated G in addition to the ability to copy and synchronize photos, ITunes 4.7 sports a few other changes o f interest to users Wh don't have an IPod Photo. The new release o f ITunes, available for download from Apple's Web site, now sports the ability to show duplicate songs in your library. Other performance improvements have been made as well. J Apple also took the wraps o f f the IPod U2 Special Edition, to celebrate the company's promotional partnership with the legendary rock band. The 20GB IPod U2 will ship in mid-November for $349, and sports a black case equipped with a red Click wheel. On the back are custom engravings o f U2 band member signatures. It's the latest promotional effort between Apple and U2; earlier this month Apple began televising spots featuring U2 in one o f Apple's signature silhouette ads, playing "Vertigo," the first single o f f U2's forthcoming album "How to Dismantle an Atomic Bomb," which will be released in late November. Apple also announced plans to offer a "Digital Box Set," which the company claims is a first in the online music industry. "The Complete U2" will feature more than 400 tracks from U2, inclUding all o f the band's albums and more than 25 rare and unreleased tracks. It will be released on the ITunes Music Store in the US and Europe beginning in late November for $149. What's more, the IPod U2 Special Edition includes an ITunes Music Store coupon that users can redeem for $50 o f f the "The Complete U2. ! 9 9 8 - 2 0 1 0 . P C W o r l d C o m m u n i c a t i o n s . Inc.

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