Timebase Pty Ltd v. Thomson Corporation, The

Filing 118

MEMORANDUM in Support re 116 MOTION to Compel Responses to Interrogatories 1 and 8 filed by Timebase Pty Ltd. SEALED DOCUMENT RECEIVED IN CLERKS OFFICE ON 2/12/10. (Gasey, Arthur) Modified on 2/12/2010 (akl).

Timebase Pty Ltd v. Thomson Corporation, The

Doc. 118 Att. 9

Exhibit 12

Dockets.Justia.com

Video Deposition of Elisabeth Huber January 5, 2009

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UNITED STATES DISTRICT COURT
______-----____-___-----------------------------------

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DISTRICT OF MINNESOTA

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LeMOND CYCLING, INC., Plaintiff,
vs.

Case No. 08-1010

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TREK BICYCLE CORPORATION, Defendant/Third-Party Plaintiff,
vs.

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GREG LeMOND, Third-party Defendant.

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Video Deposition of ELISABETH HUBER Monday, January 5th, 2009 9:33 a.m.
dL

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GASS WEBER MULLINS, LLC 309 North Water Street, Suite 700 Milwaukee, Wisconsin 53202

Reported by Julie K. Lyle, RPR/RMR/CRR

Video Deposition of Elisabeth Huber January 5,2009 1

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--

Q

What about

--

excuse me.

What about with

and

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we may as well clarify this now.

Were the bikes

that Greg LeMond purchased for himself or others at a discounted price, were those considered employee purchasing transactions?

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A

Pricingwise, yes, they were. Were they considered anything else for any other purpose?

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Q

A
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Not that I'm aware of. And could you explain how those transactions would be executed?

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A

Typically through e-mail the request would come in, and the model/size that needed to be sent out was listed, and then a corresponding shipping address and then also the payment, if they were going to be paying by a credit card or if Greg was going to be putting it on his personal account and paying for the bicycle or if he wanted it to be one of his free allotted bicycles for the model year.

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Q
A

Would you need to use the designation LEMROYT if it was not a free bike?

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No.
Okay. That's helpful. Thank you.

Q

If you could turn to Trek 012060,

Video Deposition of Elisabeth Huber January 5, 2009
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additional six months to help work with the distributor as we transitioned that over to Cycles Europe.

Q

Do you have an understanding of the relationship

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between - - at least at the time you had the position - A

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Uhm-uhm.

a
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Q

- - an understanding of the relationship between
Trek France and Trek? Yeah. Yes.

A

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a
A

What is that relationship, to your understanding?
I guess I'm unclear of what your question is.

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Q

You worked - - okay. for Trek France. work from France?

1'11 back up.

You worked

Were you - - did you actually

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I did.

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Q

And did you consider that you worked for a separate entity from Trek, or did you work - were your paychecks cut by Trek here in - - in Wisconsin?

A

They were cut by Trek in Wisconsin. And who did you report to at the time? Mary Burke. How did it become your duty to manage all these transactions for Greg LeMond?

Q
A

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Q

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WW.GRAMANNREPORT~NG.COM 414.272.7878
Innomtion Expertise.Inregrify
3

GRAMA"
REPORTING

Video Deposition of Elisabeth Huber January 5, 2009
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A

Basically, he was working through the marketing department, and it became apparent that it was kind of silly to have a middleman, the marketing department, taking his orders. They don't have
So they

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the ability to enter sales transactions.

realized that it would just be smarter to have him have a point person. Laurie Koch before me. And initially that was

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Q
A

And if I could just make sure I get this now. Laurie Koch was in the marking department or - No, Laurie Koch is the - - was my manager at the

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time.

And then she asked if I would do it, and I

said yes.

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Q
A

Do you remember what year you began managing the

bike transactions for Greg LeMond?
I want to say it was late 2004, early 2005.

Q
A

Do you know how long Laurie Koch did it before

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handing off those duties to you?
I do not.

Q
A

Do you know if Laurie Koch still works at Trek?

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She does.
Do you know why the transactions were initially

Q
A

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done through the marketing department? That was just their point - - Greg's point person. And what was your position - - at what point in

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Q

WWW.GRAMANNREPORTING.COM 414.272.7878
Innovation *Expertbe Integrity

GRAMA"
REPORTING

Video Deposition of Elisabeth Huber January 5, 2009
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your line of - - of positions that you had with Trek - A
I was - - - did you take on this duty? - - the inside regional manager.

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Q
A

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Q
A

And you continued to manage the trans cti ns throughout promotions and job changes and - Correct.
Do you have some knowledge of Trek's policy, if

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Q

there is one, regarding employee purchasing of Trek products?
A

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I do. And what's the basis of your knowledge? The employee handbook, and then also being part of the sales department, it was just common knowledge.

Q
A

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Q
A

Does the employee handbook have a provision that

specifically addresses employee bike purchases? It does. MS. RAHNE: I don't know if we have

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that, and I'm not going to ask you to promise it to me now, but we'll probably follow up with a letter. MR. WEBER: do or not. Sure.
I don't know if you

We're happy to provide it.

WWW.GRAMANNREPORTING.COM * 414.272.7878
Innovntion Ekpertiso *integrity
1

GRAMAN"
REPORTING

Video Deposition of Elisabeth Huber January 5, 2009

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Q
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But even backing up a step, it's available to Trek employees --

A

Current Trek employees. for personal use? Uhm-uhm. In practice, is it used by nonemployees?

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A

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Q
A

No.
What was the rationale for Greg LeMond's use of the employee pricing? emp1oyee ? Was he considered an

Q

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A

Pricingwise, yes.

But for him, he was considered

somebody to be a prominent cycling figure and that he had contacts in the media, and he was allowed to go beyond the normal employee

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limitations because he wanted to get out and sell his bike line. And we also wanted to keep him

and his family on the most current year product,

Q

Is there anybody else, to your knowledge, at Trek who had that right?

A

I have no knowledge since I've not worked with anybody else except Greg LeMond.

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Q

So you don't know if other prominent cyclists

with whom Trek has a relationship, for example, Gary Fisher, if he has the ability to avail himself of employee pricing?

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Video Deposition of Elisabeth Huber January 5, 2009
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individuals, and I'll start with Warren.

Were

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there ever any problems with transactions handled by Warren Gibson --

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I never had ---

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Q
A
Q

that you recall?

-- personally any problems with Warren at all.

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Were there ever any transactions that raised a question or a concern at Trek, to your knowledge?

A

Not that I'm aware of. What about Muffy? None,
No problems at all.

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A

Q

What about Bernie? Same. No problems at all.

A

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Q

How did you know about Mr. LeMond's ability to
buy Trek products at employee discount pricing? Just in
--

just due to your position and what you

were being asked to do?

A

When I was approached to take over the position, it was explained to me that he at that juncture was allowed ten free bicycles a year as part of his contract and that then he would often purchase products for friends or media contacts, sometimes a touring company person, and then he also would personally choose to sponsor some teams and extend his discount to them.

Video Deposition of Elisabeth Huber January 5, 2009
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Q
A

Do you recall who explained this to you? Laurie Koch and Dean Gore. How frequently would you say Trek shipped products plclrchased to people other than Mr. LeMond but that were Mr. LeMond's employee pricing purchases? It's a terrible question. Do you

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Q

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understand it? A Yeah, I do understand it. I've never tallied it up. would
--

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so I -- I don't know that I could give

you a distinct number.

Q

What - - could you guess a percentage of the total bikes that Mr. LeMond purchased using employee pricing?

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That went to others? Correct.

Q
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I would probably say close to 70 percent went to
others.

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Q

Are you aware of instances where bikes purchased on Mr. LeMond's account were resold?

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A

No, I'm unaware of anything specifically.
Do you have an understanding of the involvement of the dealers in Mr. LeMond's use of the employee discount program?

Q

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Video Deposition of Elisabeth Huber January 5, 2009

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A

Fairly good knowledge, yes. Can you describe generally how the dealers were involved?

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If the person who was receiving the bicycle was
not a certified mechanic, they were to have made prior arrangements with their local dealer to have the bike built and fully assembled, and they were -- depending on that individual's relationship with the dealer, would maybe pay an assembly fee, maybe not.

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Do you know how this was communicated to the individuals who received the bikes?

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I don't.

It was my understanding it was most

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likely done through Bernie.

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Q
A

Did you do anything individually to ensure that there had been a communication to the dealers?

I did not.
Do you know if anybody else at Trek did? I'm unaware o f anybody else. Besides having the -- besides having your role with the transactions explained to you by Laurie Koch and Dean Gore, did you ever need to seek additional authorization to f i l l any of the orders placed on Mr. LeMond's account?

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A

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Q

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A

I did not.

Video Deposition of Elisabeth Huber January 5, 2009

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A

Did anyone at Trek ever express any concern at any point with the transactions?

No.
Were you ever required to report or inform anyone at Trek the volume or number of bikes purchased under Mr. LeMond's employee bike purchases --

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I was not.
-- purchase program?

Q

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Do you ever recall hearing at Trek
any comments about the volume of Mr. LeMond's employee bike purchase -- purchases?

A

No.
Let's go ahead and look at a few documents. (Exhibit 60 was marked for identification.)

Q

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BY MS. RAHNE:

Q

Ms. Huber, I just want to spend a little time
looking through a set of documents related to the employee purchase - - Mr. LeMond's employee purchases, Some of them were produced by Trek,

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presumably from your file.

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A

Uhm-uhm. Some of them were produced by LeMond Cycling.

Q
A

So

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some of them may be more or less familiar to you. Uhm-uhm.

Video Deposition of Elisabeth Huber - January 5,2009

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A

And so that was why I possibly included him in this e-mail, to find out would that be part of his role and responsibilities.

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Q

Okay.

At some point during this process,

Mr. LeMond, or people acting on his behalf, began getting credit card numbers from friends, family, third parties who were purchasing bikes; is that correct? A Correct.

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A

Do you recall when that practice began?

I don't, but I remember that it was an attempt to
help minimize his AR balance.

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A

Uhm-uhm. And that what we would be billing directly to Greg would be the things that he requested specifically or if it was for his family, because, if not, it cut down on the time that he would have to have, at one juncture Muffy and then Bernie, chase down payment.

I.

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Q

Okay.

So at - - once that practice began, is it

true that the only accounts receivables that you needed to track down were for bikes that Greg was agreeing to pay for personally? A Correct. And that anybody else who purchased a bike

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Q

Video Deposition of Elisabeth Huber January 5,2009
through you know, approved by Greg for

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--

--

through his employee purchasing provided their
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own credit card number?

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A

That's correct, unless they specifically stated this is to go on Greg's account.

Q

Okay.

So when you received a contact, you had a

number of questions you had to ask, it sounds like.

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A

Uhm-uhm.

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Q

So if we can just play it out so we have it
captured.

If I'm Bernie and I contact you, I

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say, "Ms. Huber" -- you guys were on better terms
--

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A

Uhm-uhm.
- - but, "MS. Huber, I want to place an order for

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Q

three bicycles," what would be your first quest ion?

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A

Well, typically, it was a11 generally done through e-mail.

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Q
A

Uhm-uhm. Our phone conversations typically consisted of him checking availability.

Q
A

Okay.

Yeah, understood.

If it were through an
i

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e-mail, what would be your - Through an e-mail, he would give me the model,

Video Deposition o Elisabeth Huber - January 5, 2009 f
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Q
A

Uhm-uhm.
- - that he would have actually had a conversation

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with the choice.

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Q

Okay.

And this is -- you testified earlier that

you didn't see it as your role to sort of police this?

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A

Correct. But this was just sort of an informal conversation with Bernie about what you considered the appropriate way to handle this?

Q

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A

Correct. Okay.. Okay. Do you recall times when dealers

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Q

were upset about individuals purchasing bikes through Mr. LeMond's employee discount?

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I do.
How many incidents do you recall? Two specifically. And did they occur at the same time, at different times?

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Q
A

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Q
A
(2

They occurred at different times. Can you tell us about the most recent one? The most recent one was with a bike that had gone to Freewheeling Bicycle in Minneapolis.

A

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Q
A

That was our -- our bike stop. Yep. And the main contact on the e-mails that

Video Deposition of Elisabeth Huber - January 5, 2009
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!

had gone back was a Roxanne Kruder

--

I'm not

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sure I'm saying her name correctly -- and that bikes had been ordered through her and that they

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had gone into the store after the store had spent , a lot of time with them and may have even ordered product for them, thinking that the sale was going to take place through them.

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Q
A

Uhm-uhm.

And so what happened?

You received a

contact from the store dealer? I did not on that one. I read through it.

I was

questioned about it when it happened.

But the

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regional manager received the e-mail from the dealer.

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%

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Q
A

Okay. Trek? Yes.

And was that forwarded on to somebody at

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A

Who was that forwarc 2d on to? Dan Titus. Okay. And then what happened?

Q
A

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I'm not sure what happened at that juncture. Okay. Do you have any knowledge about how that

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A
Q

was resolved or if it was resolved?

I do not.
Okay. What about the other incident that ! ou

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remember ?

Video Deposition o Elisabeth Huber January 5, 2009 f
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The other incident was with -- and I don't recall the time frame.

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I want to say it was winter
But a woman had

2007.

It might have been 2008.

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walked into Sunnyside Sports in Bend, Oregon, had the s h o p employee spend a lot of time with her getting fitted, getting set up, help me choose my model. And they thought that they were going to

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be getting the sale from this individual, and then at the end of the employee spending significant time with this woman, she said, "Oh, I'm getting it through Greg LeMond." And the

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shop was - - was pretty unhappy about that.

Q
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Okay.

And do you have any knowledge about how

that was ultimately resolved, if it was? A

I apologized.

And then I spoke with Bernie and

asked him to again reiterate to people that it's okay to work with a shop but to communicate what they're doing.

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Be transparent about what the process is? Yes. Okay.

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Q

Is there anybody else at Trek who would be

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,

the recipient of dealer complaints, if you know, such as the ones you've described?

A

Bob Burns. Anybody else?

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Q