J.T. Colby & Company, Inc. et al v. Apple, Inc.

Filing 159

DECLARATION of Bonnie L. Jarrett in Support re: 104 MOTION for Summary Judgment.. Document filed by Apple Inc.. (Attachments: # 1 Exhibit 1, # 2 Exhibit 2, # 3 Exhibit 3 (REDACTED), # 4 Exhibit 4 (REDACTED), # 5 Tab - Borden Dep, # 6 Tab - Colby 30(b)(6) Dep (REDACTED), # 7 Tab - Colby Dep, # 8 Tab - Freese Dep, # 9 Tab - Goldhor Dep, # 10 Tab - Gundersen Dep, # 11 Tab - Kvamme Dep)(Cendali, Dale)

CONFIDENTIAL

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
-----------------------------x
J.T. COLBY & COMPANY, INC.
d/b/a BRICK TOWER PRESS, J.
BOYLSTON & COMPANY, PUBLISHERS
LLC and IPICTUREBOOKS LLC,
Plaintiffs,
vs.

No. 11-cv-4060

APPLE, INC.,
Defendant.
-----------------------------x

CONFIDENTIAL
VIDEOTAPED DEPOSITION OF
JOHN T. COLBY, JR.
New York, New York
Friday, July 20, 2012
9:41 a.m.

Reported by:
Jennifer Ocampo-Guzman, CRR, CLR
Ref: 7827
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CONFIDENTIAL
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Confidential-Colby

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MR. CHATTORAJ:

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4
5

A.

Objection.

I'm not sure what you mean by

financial difficulties.
Q.

That its business was doing badly?

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MR. CHATTORAJ:

Objection.

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A.

And by business what do you mean?

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Q.

You're unable to answer that

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10
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question, Mr. Colby?
A.

Well, there are two sides to a

business.
Q.

Mr. Colby, isn't it true that prior

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to Byron Preiss' death ibooks, Inc., was

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experiencing difficulties keeping the

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business afloat?

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MR. CHATTORAJ:
A.

Objection.

It would seem to, it would seem to

suggest that, yes.
Q.

And isn't it true that Mr. Preiss

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died the day after Exhibit 102, talking about

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the tax penalties, was written?

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A.

I believe that's true, yes.

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Q.

He died on July 9, 2005, isn't that

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correct?
A.

I think that's true, yeah.
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Confidential-Colby
Q.

But isn't it true that the

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financial difficulties with the company had

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occurred prior to his death?

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MR. CHATTORAJ:
A.

Objection.

Well, that's the period of time

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we're talking about, yes, he left two kids by

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the way.

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Q.

Let's look at Exhibit 106.

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(Defendant's Exhibit 106, E-mail

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dated 9/13/05, Bates No.

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COLBYHD00547340, marked for

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identification, this date.)

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Q.

Exhibit produced from the hard

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drive, COLBY HARD DRIVE 54734, from Robin

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Bader at BPVP.com to among others B.C.

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[e-mail] and

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others.

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says, Roger, do ibooks.net and BPVP.com still

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exist?

And at the bottom of the e-mail it

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And Roger Cooper responds, "In

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looking for them on the internet, (as you

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probably have), it looks like the site have

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vanished.

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Who would know officially?"
Do you see that?

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ipicturebooks folder or they could be under

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that folder too, but nonetheless that's where

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they are.

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Q.

How did you set the price of

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$125,000 that you bid to purchase the assets

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of Byron Preiss Visual Publications and

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ibooks, Inc.?

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A.

That was my estimate of the fair

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market value of the sales potential of the

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existing inventory in the next two years out.

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13
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Q.

How did you go about figuring that

A.

I created a spreadsheet by title,

out?

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may have described this on Wednesday, by

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opening inventory, purchases, sales, returns,

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pending inventory, doing that for units and

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dollars and then once I figure out the

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return, return curve, I can also figure out

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the sales curve.

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signed curves, I won't go into the math, but

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they'll go out 60 cycles, which is in my

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world five years, and I just forecasted it

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out knowing what the existing inventory, how

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long the existing inventory was going to last

These are all basically

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and then would calculate the required

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purchases to replenish that inventory.

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When the inventory ran out -- I did

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that by title -- and that spreadsheet gave me

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the total number that, well, it's a forecast

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and based on that information I thought that

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125 was a fair price.

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value situation.

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Q.

Like a net present

Did you allocate any portion of the

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purchase price to the value of the ibooks

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mark itself?

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A.

It was important to know that we

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had the rights in the mark and that

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bankruptcy trustee represented to me also the

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right to Byron Preiss Visual Publications the

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name to that one too, and to Milk & Cookies

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Press, that was very important to the marks,

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that have been mentioned earlier.

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bankruptcy trustee represented to me that

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those are the marks.

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that into the equation.

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would have been difficult to value it without

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those marks.

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place.

And the

And so, okay, I built
Otherwise, I, it

I needed all those marks in

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