Eight Mile Style, LLC et al v. Apple Computer, Incorporated

Filing 139

MOTION in Limine No. 3 to Exclude Testimony of Defendants' Witnesses as to Their Undertanding of the Meaning of the 1998 and 2003 Recording Agreements by Eight Mile Style, LLC, Martin Affiliated, LLC. (Attachments: # 1 Index of Exhibits, # 2 Exhibit 1 - Declaration of Marc Guilford, # 3 Exhibit A - Paterno Depo Excerpts, # 4 Exhibit B - Nieves Depo Excerpts, # 5 Exhibit C - Hoffman Depo Excerpts, # 6 Exhibit D - Rogell Depo Excerpts) (Busch, Richard)

EXHIBIT C to DECLARATION OF MARC GUILFORD

DEPOSITION OF RAND HOFFMAN 2 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
KELLI NORDEN AND ASSOCIATES 310.820.7733 FAX: [phone]

UNITED STATES DISTRICT FOR THE EASTERN DISTRICT OF MICHIGAN SOUTHERN DIVISION F.B.T. PRODUCTIONS, LLC, ) AND EM2M, LLC, ) ) PLAINTIFFS, ) ) VS. ) ) AFTERMATH RECORDS DOING ) BUSINESS AS AFTERMATH ) ENTERTAINMENT; INTERSCOPE) RECORDS; UMG RECORDINGS, ) INC.; AND ARY, INC., ) ) DEFENDANTS. ) _________________________)

CASE NO. CV 07-3314 PSG (MANX)

30(B)(6) DEPOSITION OF RAND HOFFMAN, TAKEN ON BEHALF OF THE PLAINTIFFS, AT 10250 CONSTELLATION BOULEVARD, 19TH FLOOR, LOS ANGELES, CALIFORNIA, COMMENCING AT 10:39 A.M., THURSDAY, MAY 22, 2008, BEFORE RENEE A. PACHECO, RPR,CSR NUMBER 11564.

DEPOSITION OF RAND HOFFMAN 21
10:54:36 10:54:38 10:54:44 10:54:48 10:54:51 10:54:55 10:54:59 10:55:04 10:55:09 10:55:13 10:55:18 10:55:20 10:55:22 10:55:26 10:55:30 10:55:36 10:55:44 10:55:48 10:55:55 10:56:00 10:56:04 10:56:08 10:56:10

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BACKGROUND, COLLEGE, LAW SCHOOL, AND THEN YOUR WORK EXPERIENCE, PLEASE. A. I WENT TO COLUMBIA COLLEGE; I WAS I WENT TO HARVARD LAW SCHOOL; GRADUATED IN 1975.

I WAS GRADUATED IN 1978. I SPENT A YEAR CLERKING FOR THE TRIAL COURT LEVEL IN MASSACHUSETTS -- THE STATE TRIAL COURT LEVEL IN MASSACHUSETTS. I TOOK A JOB AT THE LAW FIRM OF DONOVAN, LEISURE, NEWTON & IRVINE, IN MANHATTAN; WORKED THERE FOR ABOUT 15 MONTHS. AND IN MARCH OF 1981 I STARTED WORKING AT C.B.S. RECORDS. Q. A. OKAY. I WAS AT C.B.S. RECORDS IN THE LAW THEN I MOVED TO THE MUSIC IN

DEPARTMENT AND IN THE BUSINESS AFFAIRS DEPARTMENT TILL SOMETIME IN 1985. PUBLISHING DIVISION, I BELIEVE, IN 1985. EITHER 1986 OR 1987, C.B.S. SOLD ITS MUSIC PUBLISHING DIVISION, AND I WENT BACK TO C.B.S. RECORDS IN THE LAW DEPARTMENT FOR A FEW MONTHS. IN 1987, I WENT TO B.M.G. MUSIC, IN THE BUSINESS AND LEGAL AFFAIRS DEPARTMENT. THINK I WAS A VICE PRESIDENT. IN 1989, I WENT TO POLYGRAM RECORDS
KELLI NORDEN AND ASSOCIATES 310.820.7733 FAX: [phone]

I

DEPOSITION OF RAND HOFFMAN 22
10:56:28 10:56:32 10:56:38 10:56:41 10:56:48 10:56:50 10:56:50 10:56:51 10:56:54 10:56:54 10:56:55 10:56:59 10:57:03 10:57:09 10:57:11 10:57:22 10:57:29 10:57:34 10:57:38 10:57:39 10:57:41 10:57:47 10:57:50

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AS SENIOR VICE PRESIDENT OF BUSINESS AFFAIRS. POLYGRAM AND OFFERED ME A POSITION AS HEAD OF

IN

1998, SEAGRAM, WHICH OWNED UNIVERSAL MUSIC, BOUGHT BUSINESS AND LEGAL AFFAIRS FOR INTERSCOPE, GEFFEN, A & M RECORDS. Q. EVER SINCE? A. Q. EXCUSE ME. A. Q. A. HEAD OF BUSINESS AND LEGAL AFFAIRS AND WHAT ARE YOUR DUTIES AND I SUPERVISE THE BUSINESS AND LEGAL FOR INTERSCOPE, GEFFEN, A & M RECORDS. RESPONSIBILITIES IN THAT POSITION? AFFAIRS, THE PROCESS OF SIGNING ARTISTS, SIGNING LABELS, PUTTING TOGETHER BUSINESS STRATEGIES, ACQUIRING RIGHTS, EXPLOITING RIGHTS, ALL FROM THE BUSINESS LEGAL PERSPECTIVE, NOT FROM THE CREATIVE OR MARKETING PERSPECTIVE. Q. I UNDERSTAND. WHEN THERE IS A QUESTION ABOUT A COURSE OF ACTION TO TAKE, AND IT INVOLVED LEGAL ISSUES, IS THAT SOMETHING THAT YOUR DEPARTMENT HANDLES FOR THE INTERSCOPE DIVISION OF
KELLI NORDEN AND ASSOCIATES 310.820.7733 FAX: [phone]

AND I STARTED THAT POSITION IN THE AND HAVE YOU BEEN IN THAT POSITION I HAVE. AND SO YOUR CURRENT TITLE IS WHAT?

BEGINNING OF 1999.

DEPOSITION OF RAND HOFFMAN 29
11:05:43 11:05:44 11:05:45 11:05:49 11:05:55 11:05:58 11:06:01 11:06:01 11:06:08 11:06:11 11:06:19 11:06:26 11:06:30 11:06:33 11:06:33 11:06:35 11:06:36 11:06:37 11:06:38 11:06:41 11:06:44 11:06:46 11:06:47

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MUSIC GROUP STAFF. GEFFEN, A & M STAFF. Q. A. Q.

I'M PART OF THE INTERSCOPE,

SO THERE'S A SEPARATION? THERE'S A SEPARATION. OKAY. ALL RIGHT. SINCE YOU BEGAN

WITH INTERSCOPE IN 1999, AM I CORRECT THAT YOU DO NOT HAVE ANY ROLE IN THE NEGOTIATION OF THE ORIGINAL F.B.T.-AFTERMATH AGREEMENT IN 1998? A. Q. A. CORRECT. IN 1999, WHEN YOU JOINED THE STAFF WAS BUILT FROM SCRATCH

INTERSCOPE, WHO WAS ON YOUR STAFF? DURING THE FIRST HALF OF 1999, AS WE CREATED A NEW BUSINESS UNIT, BY COMBINING INTERSCOPE -- THE PREEXISTING INTERSCOPE RECORDS, GEFFEN RECORDS, AND A & M RECORDS. Q. ZACH HOROWITZ? A. Q. A. YES. WHO IS ZACH HOROWITZ? I BELIEVE HIS TITLE IS CHIEF DO YOU KNOW A PERSON BY THE NAME OF

OPERATING OFFICER OF UNIVERSAL MUSIC GROUP, BUT I'M NOT CERTAIN OF HIS EXACT TITLE. Q. MR. HOROWITZ?
KELLI NORDEN AND ASSOCIATES 310.820.7733 FAX: [phone]

DO YOU HAVE INTERACTION WITH

DEPOSITION OF RAND HOFFMAN 46
11:37:59 11:38:00 11:38:01 11:38:03 11:38:04 11:38:05 11:38:07 11:38:18 11:38:26 11:38:32 11:38:33 11:38:37 11:38:42 11:38:46 11:38:49 11:38:51 11:38:53 11:38:55 11:38:59 11:39:02 11:39:02 11:39:08 11:39:12

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THAT. Q. BY MR. BUSCH: Q. MORE INVOLVED? A. Q. A.

YOU CAN ANSWER, IF YOU KNOW. THE DEPONENT: OKAY. YES.

AND WHY DID YOU -- WAS THAT

A CONSCIOUS DECISION THAT YOU MADE TO -- TO BECOME YES. AND WHY DID YOU MAKE THAT DECISION? MY PERSONAL PHILOSOPHY WAS THAT IT

WAS APPROPRIATE THAT INTERSCOPE HAVE MORE INVOLVEMENT IN THE AFTERMATH SIGNINGS THAN IT HAD HAD IN THE PAST. Q. OKAY. AND YOU WERE AWARE THAT -WHEN YOU JOINED INTERSCOPE IN 1999, THAT THERE WAS IN PLACE A CONTRACT BETWEEN F.B.T. AND AFTERMATH WITH RESPECT TO THE SERVICES OF EMINEM? A. AT SOME POINT I BECAME AWARE OF OKAY. AND YOU ARE AWARE THAT IN

2003 A NEW AGREEMENT WAS ENTERED INTO BETWEEN F.B.T. AND AFTERMATH; IS THAT CORRECT? A. Q. YES. OKAY. AND IN CONNECTION WITH THE

DRAFTING AND NEGOTIATION OF THE 2003 AGREEMENT, WHO WAS INVOLVED IN THAT PROCESS WITH RESPECT TO
KELLI NORDEN AND ASSOCIATES 310.820.7733 FAX: [phone]

DEPOSITION OF RAND HOFFMAN 47
11:39:25 11:39:37 11:39:39 11:39:39 11:39:40 11:39:41 11:39:42 11:39:44 11:39:49 11:39:52 11:39:57 11:40:03 11:40:08 11:40:12 11:40:14 11:40:17 11:40:22 11:40:27 11:40:29 11:40:32 11:40:36 11:40:37 11:40:44

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INTERSCOPE? A. Q. 2003 AGREEMENT? MR. POMERANTZ: NEGOTIATIONS? BY MR. BUSCH: Q. THE AGREEMENT. A. Q. A. NOT DIRECTLY. WHAT DO YOU MEAN BY "NOT DIRECTLY"? WE HAVE A -- AS -- AS YOU KNOW, WHEN THE VENTURE SPENDS A IN THE NEGOTIATION OR DRAFTING OF IN THE ME AND LISA ROGELL. WAS PETER PATERNO INVOLVED IN THE

AFTERMATH RECORDS IS A VENTURE WITH A DR. DRE ENTITY, PETER'S CLIENT. FUTURE PROFITS. SO WHEN WE'RE MAKING THAT KIND OF A DEAL, WE KEEP PETER IN THE LOOP SO THAT PETER CAN MAKE SURE THAT DRE HIMSELF IS OKAY WITH IT. Q. OKAY. BUT AS FAR AS THE DIRECT NEGOTIATIONS, DRAFTING OF THE AGREEMENT AND SO FORTH, THAT WAS A LISA ROGELL, RAND HOFFMAN -A. Q. YES. OKAY. HAVE YOU EVER HEARD OF THE SIGNIFICANT AMOUNT OF MONEY, THAT CAN AFFECT

TERM "U.S.N.R.C."?
KELLI NORDEN AND ASSOCIATES 310.820.7733 FAX: [phone]

DEPOSITION OF RAND HOFFMAN 51
11:45:23 11:45:30 11:45:33 11:45:38 11:45:42 11:45:43 11:45:46 11:45:49 11:45:51 11:45:53 11:45:56 11:45:58 11:46:01 11:46:03 11:46:07 11:46:08 11:46:17 11:46:17 11:46:20 11:46:20 11:46:22 11:46:22 11:46:25

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REPLACED THIS CONTRACT? A. Q. YES. AS BETWEEN YOU AND MS. ROGELL, WITH

RESPECT TO THE 2003 CONTRACT, WHAT WAS THE DIVISION OF RESPONSIBILITY? A. THE DRAFTS. Q. AND EMINEM? A. THERE WERE CONVERSATIONS WE HAD TOGETHER, THERE WERE CONVERSATIONS I HAD WITHOUT HER, THERE WERE CONVERSATIONS SHE HAD WITHOUT ME. Q. OKAY. IN CONNECTION THE 2003 AGREEMENT, DO YOU RECALL YOUR CONVERSATIONS WITH REPRESENTATIVES OF EMINEM AND F.B.T. AND WHAT ISSUES WERE DISCUSSED? A. PLEASE? Q. MEMORY? A. MEMORY. Q. OKAY. WHEN WE GET TO THAT, THEN I'LL JUST ASK THE QUESTIONS THEN.
KELLI NORDEN AND ASSOCIATES 310.820.7733 FAX: [phone]

SHE DID THE DRAFTING, I REVIEWED DID SHE HANDLE THE NEGOTIATIONS OR

THE CONVERSATIONS WITH REPRESENTATIVES OF F.B.T.

CAN I SEE THE 2003 AGREEMENT, WOULD THAT HELP YOU TO REFRESH YOUR THAT WOULD HELP ME TO REFRESH MY

DEPOSITION OF RAND HOFFMAN 107
12:55:40 12:55:42 12:55:46 12:55:47 12:55:47 12:55:52 12:55:52 12:55:53 12:55:53 12:55:54 12:55:57 12:55:57 12:55:59 12:56:01 12:56:01 12:56:04 12:56:05 12:56:11 12:56:14 12:56:14 12:56:37 12:56:47 12:56:49

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CLAUSE.

Q.

DO YOU KNOW WHETHER, WITH RESPECT

TO LICENSES TO RHINO RECORDS OR TO A THIRD PARTY SUCH AS K-TEL THAT -- WHETHER INTERSCOPE HAS THE RIGHT TO -- TO ASSIGN THE CONTROLLED COMPOSITION CLAUSE? MR. POMERANTZ: HYPOTHETICAL. BY MR. BUSCH: Q. A. GO AHEAD. I BELIEVE THAT DEPENDS ON THE OBJECTION; VAGUE, ARGUMENTATIVE, AND IT'S ALSO AN INCOMPLETE

LANGUAGE OF THE PARTICULAR CONTROLLED COMPOSITION Q. WHAT LANGUAGE WOULD BE -- WOULD YOU MR. POMERANTZ: THE DEPONENT: OBJECTION; IT'S AN I WOULD READ THE

LOOK FOR TO MAKE THAT DETERMINATION? INCOMPLETE HYPOTHETICAL, IT'S OUT OF CONTEXT. CONTROLLED COMPOSITION CLAUSE IN ITS ENTIRETY AND, YOU KNOW, WOULD BASE MY CONCLUSION ON THAT. BY MR. BUSCH: Q. ALL RIGHT. WELL -- OKAY. SO LOOK AT PARAGRAPH 6 OF -- OF THE 1998 AGREEMENT BETWEEN F.B.T. AND AFTERMATH. AND TELL ME IF THERE'S ANY LANGUAGE
KELLI NORDEN AND ASSOCIATES 310.820.7733 FAX: [phone]

DEPOSITION OF RAND HOFFMAN 108
12:56:58 12:57:00 12:57:00 12:57:05 12:57:23 12:57:24 12:57:26 12:57:28 12:57:32 12:57:35 12:57:36 12:58:01 12:58:07 12:58:08 12:58:09 12:58:10 12:58:11 12:58:13 12:58:16 12:58:16 12:58:18 12:58:19 12:58:21

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IN PARAGRAPH 6 UNDER WHICH AFTERMATH OR INTERSCOPE WOULD HAVE THE RIGHT TO ASSIGN THE CONTROLLED COMPOSITIONS CLAUSE? MR. POMERANTZ: OBJECTION TO THE EXTENT THAT THE WORD "ASSIGN" IS VAGUE AND AMBIGUOUS AND -- AND REQUIRES A DEFINITION. THE DEPONENT: I HAVEN'T READ THE WHOLE THING, BUT THE FIRST SENTENCE SEEMS TO SAY THAT "ALL CONTROLLED COMPOSITIONS WILL BE LICENSED TO AFTERMATH AND ITS DISTRIBUTORS/LICENSEES," WHICH SUGGESTS TO ME THAT IT APPLIES TO LICENSEES. BY MR. BUSCH: Q. A. Q. COULD YOU LOOK AT PARAGRAPH -- LOOK YES. AND DO YOU SEE THAT IT SAYS: "AFTERMATH MAY ASSIGN THIS AGREEMENT TO ANY PARENT, SUBSIDIARY, OR AFFILIATE OF OURS, TO ANY PERSON OR ENTITY ACQUIRING OR ALL OR A SUBSTANTIAL PORTION OF OUR ASSETS OR TO ANY ENTITY WITH WHICH WE MERGE. A. YES.
310.820.7733 FAX: [phone]

AT PARAGRAPH 20, ASSIGNMENT.

YOU MAY NOT

ASSIGN THIS," SO FORTH AND SO ON?

KELLI NORDEN AND ASSOCIATES

DEPOSITION OF RAND HOFFMAN 110
12:59:14 12:59:19 12:59:21 12:59:22 12:59:25 12:59:27 12:59:30 12:59:31 12:59:32 12:59:33 12:59:35 12:59:35 12:59:37 12:59:39 12:59:40 12:59:42 12:59:45 12:59:48 12:59:55 12:59:57 12:59:58 12:59:59 13:00:00

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SAYS: THAT. Q.

SINCE IT'S ALREADY LICENSED, IT DOESN'T NEED TO BE ASSIGNED. NECESSARILY APPLICABLE. Q. DO YOU REMEMBER MY QUESTION OF YOU A FEW MOMENTS AGO, WHERE I ASKED YOU IF TYPICALLY THE CONTROLLED COMPOSITION CLAUSES THAT YOU DEAL WITH HAS LANGUAGE THAT SAYS "IS HEREBY LICENSED"? A. Q. A. YES. AND YOU SAID, "TYPICALLY, YES," I SAID THAT OUR FORM CERTAINLY HAS OKAY. NOW, DO YOU SEE A DIFFERENCE SO I DO NOT BELIEVE THE ASSIGNMENT PROVISIONS OF PARAGRAPH 20 ARE

THAT'S WHAT YOU DEAL WITH?

BETWEEN "WILL BE LICENSED" VERSUS "HERE" -- "IS HEREBY LICENSED"? A. NO. I THINK "WILL BE LICENSED" -CONTROLLED COMPOSITION CLAUSES MIGHT SAY "HEREBY LICENSED," MIGHT SAY "WILL BE LICENSED," OR MIGHT SAY THAT "YOU WILL CAUSE THE PUBLISHER TO GRANT A LICENSE." DRAFTING. JUST LIKE HIGHER UP ON THE PAGE IT "THE ROYALTY PAYABLE FOR NEW
KELLI NORDEN AND ASSOCIATES 310.820.7733 FAX: [phone]

"WILL BE LICENSED" IS JUST A WAY OF

DEPOSITION OF RAND HOFFMAN 112
13:00:55 13:00:58 13:01:02 13:01:04 13:01:04 13:01:07 13:01:08 13:01:09 13:01:10 13:01:12 13:01:15 13:01:18 13:01:21 13:01:23 13:01:26 13:01:28 13:01:29 13:01:32 13:01:33 13:01:33 13:01:34 13:01:36 13:01:39

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AFTERMATH ENTERS INTO A LICENSE, IT CAN EITHER MAKE AVAILABLE THIS LICENSE, BECAUSE IT'S THERE OR IT CAN CHOOSE TO SAY TO ITS LICENSEE, NO, THIS IS NOT AVAILABLE, GO OUT AND DEAL WITH THE PUBLISHER YOURSELF. BY MR. BUSCH: Q. SO WERE YOU INVOLVED IN THE DRAFTING OF THIS LANGUAGE, OF THIS CONTROLLED COMPOSITION CLAUSE? A. Q. NO. DID YOU EVER -- DID YOU EVER SPEAK

TO ANY OF THE PARTIES ABOUT WHAT WAS MEANT BY THE "WILL BE LICENSED TO AFTERMATH AND ITS DISTRIBUTORS/LICENSEES" LANGUAGE? MR. POMERANTZ: MR. BUSCH: YES. BY "PARTIES," YOU OR MR. PATERNO. WELL, I'M GOING TO MEAN EITHER THE F.B.T. OR EMINEM PARTIES? MR. POMERANTZ: EXTENT IT'S PRIVILEGED. THE DEPONENT: BY MR. BUSCH: Q. OKAY. AND SO YOU DON'T KNOW WHAT THE INTENT OF THE PARTIES WAS WITH RESPECT TO THIS LANGUAGE IN THIS AGREEMENT, DO YOU?
KELLI NORDEN AND ASSOCIATES 310.820.7733 FAX: [phone]

INSTRUCT HIM NOT TO ANSWER MR. PATERNO TO THE I DON'T RECALL.

DEPOSITION OF RAND HOFFMAN 113
13:01:59 13:02:04 13:02:06 13:02:09 13:02:27 13:02:27 13:02:31 13:02:34 13:02:36 13:02:38 13:02:39 13:02:39 13:04:27 13:04:27 13:04:27 13:04:29 13:04:29 13:04:31 13:04:31 13:04:33 13:04:33 13:01:34 13:01:36

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AGAIN?

A.

I KNOW WHAT THE INTENT OF THE

AFTERMATH/INTERSCOPE PARTIES WAS, AND I KNOW WHAT THE AFTERMATH PARTIES THOUGHT THE INTENT OF THE F.B.T. AND EMINEM PARTIES WAS. Q. A. Q. A. Q. AT 1:02 P.M. (WHEREUPON, A RECESS WAS HELD FROM 1:02 P.M. TO 1:04 P.M.) THE VIDEOGRAPHER: RECORD AT 1:04 P.M. THE DEPONENT: WOULD YOU MIND EITHER READING BACK THE QUESTION OR ASKING IT MR. BUSCH: MADAM COURT REPORTER, BACK ON THE AND HOW DO YOU KNOW THAT? I'VE HAD CONVERSATIONS -- I'D LIKE OKAY. AND --

TO ASK MY LAWYER WHETHER SOMETHING IS PRIVILEGED. AND I'D LIKE TO DO THAT NOT IN YOUR THAT'S FINE. THE VIDEOGRAPHER: OFF THE RECORD

PRESENCE SO I CAN TELL HIM WHAT IT IS.

WOULD YOU READ BACK THE QUESTION, PLEASE. (THE RECORD WAS READ AS FOLLOWS: Q AND SO YOU DON'T KNOW WHAT THE INTENT OF THE PARTIES
KELLI NORDEN AND ASSOCIATES 310.820.7733 FAX: [phone]

DEPOSITION OF RAND HOFFMAN 114
13:01:49 13:01:51 13:01:56 13:02:01 13:02:02 13:02:05 13:02:08 13:02:08 13:04:59 13:05:01 13:05:04 13:05:05 13:05:11 13:05:15 13:05:20 13:05:26 13:05:29 13:05:32 13:05:39 13:05:41 13:05:47 13:05:48 13:05:51

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CLAUSES. WITH. LONGER.

WAS WITH RESPECT TO THIS LANGUAGE IN THIS AGREEMENT, DO YOU? A I KNOW WHAT THE INTENT OF THE AFTERMATH/INTERSCOPE PARTIES WAS, AND I KNOW WHAT THE AFTERMATH PARTIES THOUGHT THE INTENT OF THE F.B.T. AND EMINEM PARTIES WAS. Q THAT?) MR. POMERANTZ: AND, AGAIN, YOU ONLY ANSWER TO THE EXTENT YOUR BASIS IS A NONPRIVILEGED COMMUNICATION, IF YOU CAN ANSWER IT. THE DEPONENT: I'VE LOOKED AT -YOU KNOW, I'VE SEEN MANY CONTROLLED COMPOSITION I'VE LIVE -- I WAS GOING TO SAY LIVED I'VE KNOWN I'VE KNOWN PETER FOR EVEN I'VE KNOWN JOEL SINCE 1999. AND HOW DO YOU KNOW

MARK FOR EVEN LONGER.

IF ANYBODY HAD INTENDED THIS CLAUSE TO BE DIFFERENT THAN A NORMAL CONTROLLED COMPOSITION CLAUSE, I BELIEVE THAT SOMEONE -- THAT WOULD HAVE COME TO MY ATTENTION BEFORE THIS LAWSUIT, BECAUSE WE WERE SELLING RECORDS BEFORE THEN, AND IT DIDN'T.
KELLI NORDEN AND ASSOCIATES 310.820.7733 FAX: [phone]

DEPOSITION OF RAND HOFFMAN 192
16:06:41 16:06:44 16:06:51 16:06:55 16:06:59 16:07:00 16:07:01 16:07:01 16:07:02 16:07:04 16:07:05 16:07:21 16:07:23 16:07:26 16:07:33 16:07:34 16:07:37 16:07:40 16:07:41 16:07:42 16:07:44 16:07:45 16:07:47

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AGREEMENT, IF YOU COULD GET THEM BOTH IN FRONT OF YOU, PLEASE. IN 1998, WHEN THE -- THIS AGREEMENT WAS ORIGINALLY ENTERED INTO, DO YOU KNOW WHETHER PERMANENT DOWNLOADS WERE A FORM OF -- A COMMERCIAL FORM OF REPRODUCTION? MR. POMERANTZ: ARGUMENTATIVE. BY MR. BUSCH: Q. 1998 AGREEMENT? A. MY RECOLLECTION IS THAT THERE -- IT WAS TECHNOLOGICALLY POSSIBLE, AND THERE MAY HAVE BEEN A FEW ISOLATED CASES, BUT NOBODY HAD STARTED A BUSINESS IN 1998 OF DISTRIBUTING DOWNLOADS. Q. DO YOU KNOW WHETHER IT WAS CONTEMPLATED BY THE PARTIES IN 1998 THAT PERMANENT DOWNLOADS WOULD OR WOULD NOT BE COVERED BY THE CONTROLLED COMPOSITION CLAUSE? A. Q. A. I BELIEVE IT WAS CONTEMPLATED. AND WHAT IS YOUR BASIS FOR SAYING EVERYBODY IN 1998 WAS FAMILIAR WITH DO YOU KNOW WHETHER PERMANENT DOWNLOADS WERE IN EXISTENCE AT THE TIME OF THE OBJECTION; VAGUE,

"IT WAS CONTEMPLATED"? THE INTERNET, EVERYBODY IN 1998 KNEW THAT AT SOME
KELLI NORDEN AND ASSOCIATES 310.820.7733 FAX: [phone]

DEPOSITION OF RAND HOFFMAN 193
16:07:56 16:08:00 16:08:06 16:08:09 16:08:14 16:08:14 16:08:15 16:08:17 16:08:18 16:08:19 16:08:21 16:08:22 16:08:23 16:08:25 16:08:28 16:08:30 16:08:32 16:08:33 16:08:41 16:08:43 16:08:45 16:08:46 16:08:46

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POINT IN THE FUTURE THERE WOULD BE THAT FORM OF EXPLOITATION. AND THE LAWYERS INVOLVED IN THE TRANSACTION ALL KNEW THIS WAS A NORMAL RECORD DEAL WHERE NORMAL FORMS OF EXPLOITATION WERE INTENDED TO BE COVERED BY THE CONTROLLED COMPOSITION CLAUSE. Q. DISTRIBUTION? A. THEY WERE NOT AT THAT TIME, BUT IT WAS CLEAR TO EVERYBODY IN THE BUSINESS THAT THEY WERE GOING TO BE. Q. DO YOU KNOW WHETHER THERE WAS A STATUTORY RATE OR A RATE OF COMPENSATION TO THE PUBLISHERS THAT HAD BEEN AGREED TO IN 1998 FOR PERMANENT DOWNLOADS? MR. POMERANTZ: THE DEPONENT: OBJECTION TO THE YES, I -- YES, THERE EXTENT IT REQUIRES A LEGAL CONCLUSION. HAD BEEN, BECAUSE A DIGITAL DOWNLOAD IS A PHONORECORD AND THERE'S A STATUTORY RATE. BY MR. BUSCH: Q. AND THERE WAS AN AGREEMENT THAT -IN 1998, IT'S YOUR VIEW THAT THERE WAS AN
KELLI NORDEN AND ASSOCIATES 310.820.7733 FAX: [phone]

DO YOU KNOW WHETHER IN 1998

PERMANENT DOWNLOADS WERE A NORMAL FORM OF

DEPOSITION OF RAND HOFFMAN 284 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
KELLI NORDEN AND ASSOCIATES 310.820.7733 FAX: [phone]

STATE OF CALIFORNIA

) )SS COUNTY OF LOS ANGELES)

DEPONENT'S DECLARATION

I CERTIFY UNDER PENALTY OF PERJURY THAT THE FOREGOING IS TRUE AND CORRECT.

EXECUTED AT _____________________ ON ____________.

___________________________________ (SIGNATURE OF DEPONENT)