Unites States of America v. Apple, Inc. et al

Filing 412

DECLARATION of THEODORE J. BOUTROUS, JR. in Support re: 411 Objection (non-motion). Document filed by Apple, Inc.. (Attachments: # 1 Exhibit A, # 2 Exhibit B, # 3 Exhibit C, # 4 Exhibit D, # 5 Exhibit E, # 6 Exhibit F, # 7 Exhibit G, # 8 Exhibit H, # 9 Exhibit I, # 10 Exhibit J, # 11 Exhibit K, # 12 Exhibit L, # 13 Exhibit M, # 14 Exhibit N, # 15 Exhibit O, # 16 Exhibit P)(Boutrous, Theodore)

Exhibit B

From:
Sent:
To:
Cc:
Subject:

Boutrous Jr., Theodore J.
Monday, November 11, 2013 7:48 AM
Michael Bromwich
Nigro, Barry; Cirincione, Maria; Swanson, Daniel G.; Richman, Cynthia
RE: Apple -- Expense Guidelines

Dear Michael:
I am very surprised and disappointed in your email below. I thought that we had set things on a
productive and collaborative path in our call last week and with my follow up list of potential
interviewees (which was much broader and longer than the one I had suggested during the cordial
November 6 call). During our call, I specifically noted that the week of November 18 might not be
feasible or convenient and suggested that the week of December 2 (the week after the intervening
Thanksgiving holiday week) might work well. When I then followed up and proposed December 2,
you responded in your November 7 email that you would be in Europe the week of December 2 and
had some other scheduling conflicts that week and the week of December 9. I then simply wrote back
and asked if you could reshuffle your schedule so that we could make the December 9 timeframe
work.
Your response below was not in the spirit of our efforts and offer to host you at Apple
headquarters for a full slate of interviews and provide other information well in advance of the date on
which your review of the new compliance and training programs is to commence under the Final
Judgment (January 14). As set forth in my October 31 letter, Judge Cote and the Final Judgment could
not have been clearer regarding the timing and scope of your review and the need to avoid unduly
intruding on Apple’s business operations. The Final Judgment is also clear that any “interview [is] to
be subject to the reasonable convenience of such personnel….” Final Judgment at VI.G.1. Contrary to
your suggestions below, and as Apple’s General Counsel Bruce Sewell made clear in his letter to you
and I emphasized when we spoke and in my letter to you and in my conversations with the Justice
Department and States on these issues, Apple takes its obligations and responsibilities under the Final
Judgment very seriously. To that end, and among the other things it is doing on this front, Apple has
made a reasonable proposal regarding the requested interviews and for working collaboratively and
productively with you. Under the circumstances, your demands and approach are unreasonable,
unnecessary and unwarranted, and go well beyond the scope of the Final Judgment and Judge Cote’s
guidance.
Ted

Theodore J. Boutrous Jr.

GIBSON DUNN
Gibson, Dunn & Crutcher LLP
333 South Grand Avenue, Los Angeles, CA 90071-3197
Tel [phone] • Fax [phone]
[e-mail] • www.gibsondunn.com
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From: Michael Bromwich [mailto:[e-mail]]
Sent: Saturday, November 09, 2013 2:48 PM
To: Boutrous Jr., Theodore J.
Cc: Nigro, Barry; Cirincione, Maria; Swanson, Daniel G.; Richman, Cynthia; [e-mail]
Subject: Re: Apple -- Expense Guidelines

Ted,
This is a very disappointing response, and very much at odds with what my understanding was during
and after our call last Wednesday. The company was put on notice on October 22 that we intended to
make our initial visit the week of November 18. Your response suggests that our request was not -and is not -- taken seriously by the company. Apple is a can-do company, and I am confident that
they can pull this together. If they maintain that they cannot, that suggests to me that they do not
take its obligations and my responsibilities under the Final Judgment very seriously. The questions
below need only be answered if the company maintains that that it unable to comply with our request
for a series of interviews and meetings the week of November 18.
Please advise which of the 15 people (Sewell, Moyer, Levoff, Vetter, Andeer, Said, Persamperi, Moerer,
McDonald, Cook, Schiller, Cue) identified in your e-mail and my response are unavailable for as little
as an hour any day the week of November 18 (Monday through Friday). Be prepared to support any
representations concerning their unavailability with detailed copies of their schedules for that entire
week.
Please confirm that contact has been made with the 2-3 Board members identified in my e-mail who
appear to work in the vicinity of Apple's headquarters, and that they are also unavailable for a
meeting/interview of similar length.
Please advise which of the subjects identified in my recent e-mail cannot be addressed in a
presentation/discussion (with almost two weeks notice) and why that is the case.
I remain willing to upend my schedule and make the trip this coming week rather than the week of
November 18 if that will mean the company is better able to comply with our quite reasonable
requests. I am not prepared to drag things out any longer than that.
Thanks.
MRB
On Sat, Nov 9, 2013 at 4:01 PM, Boutrous Jr., Theodore J. <[e-mail]> wrote:

Michael:
I have now heard back and, unfortunately, that week is very bad in terms of
scheduling. I know you will be out of the country the week of December 2, but we would very much
appreciate it if you could work on your scheduling conflicts the week of December 9 and make the trip
that week. Apple will be able to have a full slate of interviewees for you to meet with that week along
the lines of my prior email and the new ACO will have had time to get acclimated and up and
running. This will get things off to a strong start and would be much better from the standpoints of
efficiency and effectiveness. It doesn’t make sense to have you fly all the way to California only to
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meet with a few people the week of November 18. In the meantime, we can start getting you some of
the information you have requested. We are also working on a new confidentiality arrangement based
on the protective order. Can we make this work?

Theodore J. Boutrous Jr.

GIBSON DUNN
Gibson, Dunn & Crutcher LLP
333 South Grand Avenue, Los Angeles, CA 90071-3197
Tel [phone] • Fax [phone]
[e-mail] • www.gibsondunn.com

From: Michael R. Bromwich [mailto:[e-mail]]
Sent: Saturday, November 09, 2013 11:30 AM
To: Boutrous Jr., Theodore J.
Cc: Nigro, Barry; Cirincione, Maria; Swanson, Daniel G.; Richman, Cynthia; [e-mail]
Subject: Re: Apple -- Expense Guidelines

Thanks, Ted. We appreciate it. We will plan to fly in late Sunday and be ready to go first thing Monday
morning unless a Tuesday start would be significantly better for the company.

Also, we would be grateful for any of the materials we originally requested October 22.
Best.
MRB
On Nov 9, 2013, at 2:13 PM, "Boutrous Jr., Theodore J." <[e-mail]> wrote:

Checking to see what can be pulled together for that week Will report back

Theodore J. Boutrous Jr.

GIBSON DUNN
Gibson, Dunn & Crutcher LLP
333 South Grand Avenue, Los Angeles, CA 90071-3197
Tel [phone] • Fax [phone]
[e-mail] • www.gibsondunn.com

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From: Michael Bromwich [mailto:[e-mail]]
Sent: Thursday, November 07, 2013 12:58 PM
To: Boutrous Jr., Theodore J.
Cc: Nigro, Barry; Cirincione, Maria; Swanson, Daniel G.
Subject: Re: Apple -- Expense Guidelines

Thanks, Ted. Let's keep trying for the week of November 18. The following two weeks
are bad for me -- I'm out of the country and otherwise committed the week of December
2 and have some real scheduling difficulties the following week as well. And then we're
into the holidays when we can expect people to be traveling everywhere.
We have always understood that we would not be able to grab everyone we would like to
meet or interview the week of the 18th, but let's resolve to do the best we can. The list
you have generated is an excellent start.
In addition to the people on this list, all of whom we want to meet/interview either the
week of the 18th or at some point soon thereafter, we would like to interview/meet Tim
Cook, Phil Schiller, and Eddie Cue. If there are other Senior VPs who touch antitrustrelated issues in a meaningful way, we would like to add them to the list as well.
In addition, we would be very interested in gathering information while we are out there
on the following.
1. A discussion of the overall compliance structure at Apple -- spheres of responsibility,
reporting structure, and personnel involved in compliance.
2. Overview of the compliance activities that were commenced after the Final
Judgment, as referred to in Bruce Sewell's November 4 letter.
3. Overview of the structure and operation of the Risk Management Committee.
4. Overview of the role of the Audit Committee in compliance
5. Overview of the evaluative tools -- e.g., outside audits and reviews -- currently used to
review and monitor the compliance program.
6. Discussion of the tools and methods currently used within the company to promote
compliance.
7. Structure for reporting and investigating suspected compliance violations (antitrust
and other issues).
8. Existing system for imposing discipline on company personnel who violate
compliance policies.
9. Mechanisms for reporting compliance violations and preventing retaliation.
These are just a few ideas about topics that I have found very worthwhile to explore at
the outset of monitoring. I will leave to Apple which of these it wants to take up the
week of 11/18 and which it would prefer to defer until our next trip -- realistically,
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probably in early January. I am open to interviewing people who are the most
knowledgeable on these subjects, or receiving presentations, which can then be later
followed up on with interviews. I want to be as flexible as possible about this, but I have
no doubt we will be able to usefully fill 2-3 days the week of 11/18.
We would also very much ask for the company's assistance in arranging interviews with
its Board members. In addition to Mr. Cook, I note that Mr. Levenson and Mr.
Campbell, both of whom are members of the Audit Committee, are based in Mountain
View (Campbell) and South San Francisco (Levenson). My understanding is that Mr.
Gore either lives of frequently visits Northern California. If one or more of these outside
directors are available the week of the 18th, we would very much like to meet with them.
Thanks very much for your continued assistance and cooperation on this.
Best.

MRB

On Thu, Nov 7, 2013 at 3:16 PM, Boutrous Jr., Theodore J. <[e-mail]>
wrote:
Thank you Michael. I look forward to reviewing this and very much appreciated our call
yesterday. The week of November 18 is looking bad from a scheduling standpoint (including
because the new Antitrust Compliance Officer will be officially starting work that week and a
number of other folks will be traveling), so we would like to propose the week of December 2. I
am still working to confirm, but interviewees could potentially include:

Bruce Sewell, Senior Vice President, General Counsel, and Secretary Member of Management
Risk Oversight Committee
Tom Moyer, Chief Compliance Officer and Head of Global Security
Gene Levoff, Senior Director, Associate General Counsel - Corporate Law and Assistant
Secretary, Legal Counsel to Audit and Nominating and Corporate Governance Committee,
Liaison to Board of Directors, Counsel Risk Management Committee
Doug Vetter, Vice President, Associate General Counsel Product Law and Assistant
Secretary. Assumed responsibility in July 2013 for legal groups supporting hardware, software,
and iTunes (including App Store and iBooks Store).
Kyle Andeer, Senior Director, Competition Law & Policy
Deena Said, Antitrust Compliance Officer
Annie Persamperi, Legal Counsel, iBooks Store
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Keith Moerer, Director, iTunes content
Rob McDonald, Head of iBooks Store for the United States

I hope we can work together to make this a productive first trip for you to Apple and sets us on a
joint path to achieving the objectives of this effort.
Ted
Sent from my iPad
On Nov 7, 2013, at 1:00 PM, "Michael Bromwich" <[e-mail]>
wrote:
Dear Ted,
As promised during our call yesterday afternoon, attached please find a
letter that sets forth the items included in Apple's expense policies that we
feel comfortable signing on to. As you will see, we have no objection to
agreeing to follow those polices that don't raise independence concerns or
otherwise seem inappropriate. Please let us know if you have any
questions or need to discuss any of the specific items.
Again, I want to thank you for the very productive discussion we had
yesterday. We look forward to receiving the list of people and groups the
company is proposing we meet and/or interview the week of November 18
so we can reach closure on the issue as soon as possible and schedule the
trip.
Best regards.

MRB
<Apple -- Letter to Boutrous -- 11-7.PDF>

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