SCO Grp v. Novell Inc

Filing 858

NOTICE OF FILING OF OFFICIAL TRANSCRIPT for dates of March 11, 2010-Jury Trial before Judge Ted Stewart, re 567 Notice of Appeal,. Court Reporter/Transcriber Patti Walker, CSR, RPR, CP, Telephone number [phone]. NOTICE RE REDACTION OF TRANSCRIPTS: Within 7 business days of this filing, each party shall inform the Court, by filing a Notice of Intent to Redact, of the parties intent to redact personal data identifiers from the electronic transcript of the court proceeding. The policy and forms are located on the court's website at www.utd.uscourts.gov. Please read this policy carefully. If no Notice of Intent to Redact is filed within the allotted time, this transcript will be made electronically available on the date set forth below. Transcript may be viewed at the court public terminal or purchased through the Court Reporter/Transcriber before the deadline for Release of Transcript Restriction. After that date it may be obtained through PACER. Redaction Request due 5/10/2010. Redacted Transcript Deadline set for 5/20/2010. Release of Transcript Restriction set for 7/19/2010. (Attachments: # 1 Part Two, # 2 Part Three)(jmr) Modified by removing restricted text on 7/19/2010 (rks).

SCO Grp v. Novell Inc

Doc. 858 Att. 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 THE COURT:

(10:20 A.M.) Counsel, the Court will not allow the

jury to hear that portion of the deposition of Mr. Levine that's in question. I believe that it would be inconsistent

with the Court's prior ruling, and I believe that the prior ruling was well founded. So if you would make certain that

that part is not presented to the jury. MR. NORMAND: THE COURT: Thank you, Your Honor. Is there something else we need to deal

with before we bring the jury in? MR. BRENNAN: Just a quick housekeeping matter in We've had a bit of a dialogue

terms of order, Your Honor. during the break.

As Novell understands it, the order of the

remaining videotape depositions today will be Mr. Mohan will be next, and then Mr. Michels following, and then Mr. Levine, the witness that you just made reference to in your comments, Your Honor. And then, at least as we've played through the time here, it looks like there will still be time available. And I

believe, certainly SCO's attorneys can speak for themselves, that they may try to bring over their next witness, who will be a live witness. time gap. And if that can't be arranged, we'd have a

We would expect that that vacuum would be filled

with a charge against the plaintiffs for not using the time or some other remedy that the court might think appropriate.

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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 Honor. has said.

THE COURT: MR. SINGER:

Mr. Singer. We don't disagree with what Mr. Brennan

I mean we'll try to get -- if there is time left

over after running through those three depositions, and it makes sense to start Mr. Broderick if there's more than just a few minutes, we'll try to present him. But we certainly

understand if he's not ready to go, if there's some gap of time, that would be on our account. THE COURT: Would you have any -- are you prepared

to deal with Mr. Broderick if he is brought on live? MR. BRENNAN: THE COURT: time, the jury's time. MR. SINGER: And that's our preference as well, and We are, Your Honor. I would prefer that we not waste any

we're trying to get him ready to go in the afternoon if there's some time. MR. NORMAND: We need to get him into a suit, Your

The Court: MR. NORMAND: THE COURT: downstairs I think.

A suit. A suit. You know, the marshals have suits I'm not sure about the fit, but --

All right, Ms. Malley, if you'd please bring the jury in. (jury present) MR. NORMAND: Your Honor, the next witness SCO will

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call by video deposition is Alok Mohan, who was deposed on February 23rd, 2007. (Alok Mohan called as a witness via videotape deposition) Q In 1995 were you the President of the Santa Cruz

Operation? A Q 1995? A I was Chief Operating Officer for a short while, and then I was CEO around that time, '95 to '98. Were you President and CEO Of the Santa Cruz Operation in

I became CEO. Q Do you remember what your position was at the time of the

transaction between Novell and Santa Cruz Operation? A Q A Q I was the CEO. Were you also a member of the Board of Directors? Yes. And would it be fair -- what would -- you were aware that

there was a contract relating to the transaction between Novell and Santa Cruz; correct? A Q Yes. Would it be fair to say that your involvement in the

Novell/Santa Cruz deal was only at a high level? A Q I was involved as a CEO, at the CEO Level. Would it be fair to say that your involvement as the CEO

For Santa Cruz on the Novell/Santa Cruz transaction was only at a high level?

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A Q

What do you mean by high level? Do you recall having characterized your involvement in

the Novell/Santa Cruz transaction as at the high level? A Well, I was the CEO and there were a lot of people

involved within the transaction from our side, so I was involved as a CEO. Q So is it fair to say that your involvement in the

Novell/Santa Cruz deal was only at a high level? A Q Yes. Is it fair to say that you were not involved in the

details of the legal documents that were executed as part of the Novell/Santa Cruz deal? A I was involved in the normal processes. I was involved

in reviewing documents.

I was not involved in writing them.

And the detail level of negotiations, I was not involved in that, although I did have some discussions with Duff Thompson, as well as Frankenberg. Q You said, "I was involved in reviewing documents." As

you sit here today, what documents do you recall reviewing as part of the Novell/Santa Cruz transaction? A Q I recall looking at the APA and reviewing that. Is it fair to say that you were -- you did not

participate in the negotiation meetings between representatives of Novell and Santa Cruz when the legal document was being drafted?

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A

I was -MR. NORMAND: THE WITNESS: Objection to form. -- involved in the negotiations with

Duff Thompson, and -- at a -- and, again, at a strategy and CEO level. The specific drafting of the documents were done

by people, and I was not involved in that. Q Now, you signed the Asset Purchase Agreement; is that

right? A Q A Q That's true. Did you review the document before signing it? Yes, I did. Did you go through it in a -- on a detailed basis by

yourself? A Q I read it. Did you read the Asset Purchase Agreement from the front

cover to the end? A Q Yes. And I take it that when you signed the Asset Purchase

Agreement on September 19th, 1995, you had no reason to believe it was inaccurate? A Q Yes, I agree with that. And you had no reason to believe that the Asset Purchase

Agreement was not clear? A It -- it -- these complex documents, it -- it represented

as best as we could tell at that time what the intent was.

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And I looked at it, as I do all documents, with that in mind, and it looked right to me so I signed it, yes. Q When you read the document before you signed it, nothing

jumped out at you as being unclear; is that a fair statement? A Q Yes. And when you signed the document on September 19, 1995,

you had no reason to believe that that contract did not accurately reflect the parties' intent; correct? A Q That's right. One of the other items that Santa Cruz got through its

transaction with Novell in 1995 was the right to sell UnixWare; correct? A Q A We bought the business. Santa Cruz got the right to sell UnixWare; right? And, again, I -- I -- I will just keep it in terms of we We could do whatever we wanted to do it. Absolutely. But as

bought the business.

As part of that could we sell UnixWare?

part of the whole -- it's the whole business we bought. Q And in 2000 do you recall that Santa Cruz agreed to sell,

among other things, the SCO OpenServer product to Caldera? A This is where I was not -- I was on the Board. I was further removed from the I was not

the CEO at that time.

business, but -- so keep that in mind as you ask these questions. Yes, we entered in an agreement to sell the Unix

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business to Caldera. Q And when you say that Santa Cruz agreed to sell the Unix

business to Caldera, I take it you're referring to not only the SCO OpenServer product but also the Unix business that it had purchased from Novell? A Q Yes, everything. In your personal view, what rights, if any, did Novell

retain after the Asset Purchase Agreement with Santa Cruz? A I -- my belief has always been, and I believe we bought And I -- the intent of that -- intent of

the whole business.

that agreement, when I was talking to Duff Thompson and at least in the higher level discussions, was we were buying the whole business. It wasn't leaving any rights behind.

It was -- what happened was that since we couldn't afford the purchase price of the SVRX revenue stream, which is like checks coming in every month, basically what it was, and we couldn't afford it. that stream would be. We couldn't pay the present value of what We also felt that there was a And so as I

difference of opinion about what that stream is.

looked at it, it was a financial engineering -- it was a transaction bridge between what we were willing to pay and what they were willing to pay. What they wanted was to allow

them to keep that revenue stream. Now, to keep a revenue stream, they needed the ability to -- I assume -- the ability to make sure that we kept the

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clients.

If they had a problem with the SVRX, that we will But I was

take care of -- or that problem is taken care of.

not -- at least at our level, I was not thinking of that we're leaving any rights like they owned anything or any rights of that kind, no. Q And So I -- I want to be clear. What particular rights You said -- you said --

then do you think Novell retained? let me look at it this way.

You said -- you said you thought

that Santa Cruz was leaving no rights behind. A Q Yeah, pretty much. So is it a fair statement then that you believe that

Novell was retaining no rights? A My -- without -- without getting into the specific

documents, which every -- there were a lot of other people in the organization who could do that for you. From a -- the

view of what we're buying, we're buying the whole business, and we -- we had all the rights as we bought the business. There was a revenue stream that -- and -- and I have to assume that there is some ways to protect that revenue stream, but I can't tell you what that would be, but it was not like we were leaving something behind. business. Q I want to fairly characterize what you're saying, so Is it a fair characterization of We were buying the

correct me if I'm wrong.

your testimony that you believe that Novell was retaining no

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rights through this transaction, but that it was retaining a revenue stream related to SVRX? A Q Yeah. I was -- I'm trying to state this is what my --

And I'm only talking about your personal belief, no one

else's. A It's not so much a belief, because I know that there's

documents that have a certain defined definition of what they can and cannot do. My negotiation, my involvement, was that And there were some aspects

it was -- we bought the business.

of things, and I can't tell you what they were, to allow them to protect the fact that the revenue stream -- that they get paid. Q And -- but I can't tell you anymore than that. You keep referring to documents that you could look at.

Are you referring to the contract? A Q Yeah, I assume. Okay. So if I wanted to know what rights Novell

retained, can I look at the contract and find out? A Q You'll have to look at it. Is it true that if I wanted to find out what rights

Novell did retain, I could look at the contract? A Q I don't know that. You believe that Santa Cruz got the Unix copyrights

through the APA; is that right? A We believe I bought the whole business. That includes

all kinds of stuff.

And -- and, you know, I gave you the

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answer. Q

I think we bought -- we got the whole thing. But you haven't -- you haven't confirmed. Is --

Okay.

is -- are the Unix copyrights part of the Unix business? A Q Absolutely. What is the basis of your opinion that Santa Cruz got the

business? A That -- that's -- that was the whole discussion and That's my recollection of what we were

intent, negotiations. doing. Q

Now, back to the topic of Unix copyrights.

Are you aware

that the subject of Unix copyrights was specifically addressed in the contract? A Q No, I'm not aware of that. When you signed this document, you -- did you actually

look to see whether or not there were any provisions in here relating to Unix copyrights? A I -- I think -- I think we have to -- what I'm trying to It is the

get across is it is not one item at a time. entirety of the document as I read it. was buying the business. specific provisions.

I felt then that this

And I -- I -- it's not about

It was the entirety of the document.

And to me the business includes copyrights. Q I'll just repeat the question. Is it your testimony that

you can't just look at the excluded assets provision to determine whether or not Unix copyrights were included in the

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transaction? A Again, you got to look at the whole thing as an entirety.

And there were some issues relating to -- and that's why there were amendments to these documents. And -- but my -- my point

that the intent was that we're buying the whole Unix business, that included copyrights, etcetera, still that's what I believe. Q Do you recall who else at Novell you were dealing with

beside Mr. Frankenberg? A The other person that I dealt with on the APA or the

discussion leading up to that was Duff Thompson. Q Duff Thompson was the person that you were speaking to

before the Asset Purchase Agreement was executed? A Q Right. When you signed the declaration, were you content that

the language of the declaration reflected your views? A Q Yes, I think so. Looking at paragraph four of your declaration, Mr. Mohan,

you say in the third Sentence of that paragraph four quote: "To the extent anyone is claiming that Novell retained the Unix copyrights or that Novell retained the right to waive material breaches of Unix system V agreements years after the sale to Santa Cruz, such claims are contrary to my understanding, intent and agreement. I would not have agreed

to do -- to those terms if anyone had suggested that that was

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what Novell was offering," end quote. language? A Q Yes.

Do you see that

Why would you not have agreed to those terms if someone

had suggested that that was what Novell had offered? A Well, I -- I was -- I can speak to the strategy and the I made this point

intent was we wanted to buy the business. earlier today.

And the business included all the assets, And what -- and we're It would

which included in my view copyrights.

kind of buying the stuff lock, stock and barrel.

have been that way if you could have afforded the present value of the royalty stream, but because of cash constraints we had to -- cash constraints and the differences -- potential differences on what the value of that future stream would be, that we said we'd pass the revenue on to Novell, 95 percent of it on to -- to Novell. But as I saw it, we bought the business that included all this stuff. And if you -- if you don't buy -- an evaluation

in my mind was set based on we bought the whole business. Q Why would you not have agreed to the terms of the deal if

someone had told you that the Unix copyrights were being retained by Novell? A I felt -- I believe that is all part of the value of what

we were buying, and it's -- it's an assessment of the value of what you buy, what you pay for. And to me that was -- that

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was part of what we had bought, and it would be a lot less value without it in my view. Q Why would you not have agreed to the terms of the

transaction if anyone had suggested to you that Novell retained the right to waive material breaches of Unix System V agreements? A If they could waive material breaches, then we did not It was of less value to

control Unix System V as an asset. us. Q

You say in paragraph five quote, "As the Chairman of the

Board of Santa Cruz in 2001, I understood that Santa Cruz conveyed to Caldera International, Inc. all of the Unix and UnixWare assets that Santa Cruz owned, including all of the Unix intellectual property rights, such as the copyrights that Santa Cruz had obtained from Novell," end quote. that language? A Q A Yes. Is that an accurate statement? I think so. MR. NORMAND: Your Honor, at this point we would ask Do you see

to publish to the jury SCO exhibit 526, which is already in, And to highlight the portions of that exhibit that Mr. Mohan will be subsequently asked about. THE COURT: MR. NORMAND: Go ahead. This is the press release from

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September 20th, 1995 after the execution of the APA.

The

first paragraph of the press release states quote, "The Santa Cruz Operation, Inc. and Novell Inc. today announced a definitive agreement for SCO to purchase the Unix business from Novell." Next paragraph down: "Alok Mohan, President and CEO Of

SCO, said, 'This extends SCO's leadership position in the Business Critical Server market. Our customers and resellers

not only get a powerful Unix operating system, but also the most advanced network services in the world. Novell's

advanced network services, such as NetWare Directory Services, are setting the standard for business networking. Our

customers will be able to integrate their Business Critical Servers with their existing work groups to provide their people with greater access to corporate data." And on page two of this press release there's a -Mr. Calvin, let's start with the top paragraph -- those two. The first paragraph is a quote from Robert J. Frankenberg, Chairman and CEO of Novell. paragraph states: And then the next

"According to the terms of the agreement,

SCO will acquire Novell's UnixWare business and Unix intellectual property." And I'd like to continue with the deposition, Your Honor. Q -- Mr. Mohan, what's previously marked as Exhibit 1028.

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Exhibit 1028 is titled "Press Release" under SCO letterhead. The title of the press release is, quote: "SCO acquires Unix

business from Novell and licenses NetWare technology," end quote. Do you see that you're quoted in the second paragraph of the first page? A Q Yes. And do you see that Robert Frankenberg, Chairman and CEO

Of Novell, is quoted at the top of the second page? A Q Yes. The press release states on page two, in the first "According to the

Sentence of the second paragraph quote:

terms of the agreement, SCO will acquire Novell's UnixWare business and Unix intellectual property," end quote. see that language? A Q Yes. Does that language accurately reflect your understanding Do you

of the transaction? A This language is consistent with what I've been saying We bought the UnixWare And

today about we bought the business. and Unix intellectual property.

We bought the business.

that's what I thought we were buying, and I still believe that's what we bought. Q Did anyone from Novell ever say to you prior to the

execution of the APA that Novell intended to retain any Unix

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or UnixWare copyrights? A Q No. Did anyone from Santa Cruz ever say to you prior to the

execution of the APA that they understood that Novell intended to retain any Unix or UnixWare copyrights? A Q No. You say in paragraph six of your declaration quote: "In

approximately early April, 1996, it came to my attention that Novell, purportedly on behalf of itself and Santa Cruz, was planning to enter into an agreement with IBM purportedly amended its Unix license agreements by granting IBM a buyout of its binary royalty obligations and expanding its source code rights," end quote. A Q Yes. Did anyone from Novell ever say to you at anytime in 1996 Do you see that language?

that Novell had retained any Unix or UnixWare copyrights under the APA? A Q No, I don't recall that. Did anyone from Santa Cruz, including Santa Cruz' outside

counsel, say to you at anytime in 1996 that they believed Novell had retained any Unix or UnixWare copyrights? A Q I don't recall that. Was it ever your view in the course of 1996 that Novell

had the right to direct Santa Cruz to waive its rights under its SVRX licenses?

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A

No.

Again, I thought we had bought the business so we And if someone else could just tell us to So I -- I -- I

had the rights.

waive the rights, then what did we buy?

felt -- I had felt that we bought the business. Q Do you recall whether Mr. Frankenberg or anyone else at

Novell ever said to you that Novell had retained the rights to waive Santa Cruz' rights under Santa Cruz' SVRX agreements? A Q No. Was it ever your understanding of the APA that Novell had

the right to prevent SCO from exercising its rights with respect to SVRX source code under the agreement? A It was our business, it was our ownership, and we could

do according to whatever our rights were. MR. NORMAND: Your Honor, we would propose to move

into evidence SCO exhibit 180 on the basis of foundation laid a few minutes ago by Mr. Mohan regarding a dispute that had arisen concerning IBM. THE COURT: Mr. JACOBS: sidebar, Your Honor? THE COURT: Mr. JACOBS: Yes. Do you want this on the record? Mr. Jacobs. Yes, Your Honor. Could we have a quick

Yes, please.

(bench conference discussion according to the reporter's ability to hear and understand what was said) Mr. JACOBS: I want to make sure at the time --

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(Reporter interrupted due to inability to hear and understand) (inaudible) there was a stand-still agreement between the companies in agreeing that this sort of correspondence would not come in in the event of a future dispute. I want to have

an understanding that if we don't object on the basis of that agreement to this exhibit coming in, that SCO will not object to corresponding exhibits from our side coming in with respect to the nature of this dispute. MR. NORMAND: objection. THE COURT: Mr. JACOBS: All right. That's fine, Your Honor. (In open court) Mr. JACOBS: objection. THE COURT: Exhibit 180 will be admitted. In light of our sidebar, Your Honor, no We have no objection. We have no such

(Plaintiff's Exhibit 180 received in evidence) MR. NORMAND: This is a letter dated April 19th,

1996 from Mr. Mohan identified as President and Chief Executive -- sorry -- from Mr. Frankenberg, CEO of Novell, to Mr. Mohan, President and Chief Executive Officer of SCO. The first paragraph says: letter today. matter. "Dear Alok, thank you for your

I understand your deep concern about this

We had been expecting your response yesterday and I will

have already continued our discussions with IBM today.

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do my best to make sure that we address your concerns in our ongoing negotiations. In addition, I believe I need to

clarify some potential misconceptions in your letter." The letter continues: "First of all, I would like to

clarify that we are not granting IBM any additional rights beyond what they already have. With the minor exception of

allowing IBM's VAR -- VAR's to make minor modifications to AIX code to support unique hardware devices and allowing IBM's major accounts to make temporary fixes from AIX source code, the proposed transaction does not grant any additional rights beyond those granted other similarly situated Unix licensees. Specifically no right to sublicense source code is being granted." And we'd like to continue with the deposition at this point, Your Honor. THE COURT: Q All right.

Mr. Mohan, what's been marked as Exhibit 1064, a letter The

to you from Mr. Frankenberg dated April 19th, 1996.

letter contains the following language in the -- beginning in the second paragraph, quote: "First of all, I would like to

clarify that we are not granting IBM any additional rights beyond what they already have, with the minor exception of allowing IBM's VAR's to make minor modifications to AIX code to support unique hardware devices and allowing IBM's major accounts to make temporary fixes from the AIX source code.

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The proposed transaction does not grant any additional rights beyond those granted other similarly situated Unix licensees," end quote. Do you see that language? A Q Yes. Was it ever your understanding of Amendment-X that IBM

received additional rights beyond what it already had, with the exceptions that I just read into the record? A I believe that -- that we did not grant any additional

rights in this buyout of the -- of the kind which is we talk about here. Q Assuming that Santa Cruz got the Unix copyrights in this

deal, would possession of the Unix copyrights have been a significant part of Santa Cruz' business going forward? A I don't know what you mean by a significant part. I

can't parse an asset purchase that has all these pieces that we buy to parse it to -- to try to assign values within this stuff. We bought the business. We paid a certain price for It's like a

the business.

Business includes everything.

human being, you know, just you -- your arms and legs and everything are part of you. MR. NORMAND: It's part of the business.

Your Honor, that completes SCO's

designations for Mr. Mohan's deposition testimony. Mr. Jacobs: Your Honor. And we have some counterdesignations,

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THE COURT:

All right.

Go ahead, please.

You weren't participating in the meetings that were

occurring between the respective parties that were -A Q A Q I was not. -- drafting the document? I was not. Would you agree with me that both companies, Novell and

Santa Cruz, had very capable skilled legal teams that were representing it in this transaction? A Q A You're looking for my opinion? I'm asking for your opinion. My opinion is that these lawyers are probably pretty

good, yes. Q I assume as Chief Executive Officer you've been involved

in a number of transactions over the years? A Q A Uh-huh. You're looking for my opinion?

I'm asking for your understanding. My opinion is that these lawyers are probably pretty

good, yes. Q I assume as Chief Executive Officer you've been involved

in a number of transactions over the years? A Q Uh-huh, yes. And you would use experienced and capable law firms in

representing you in complex transactions such as this? A We would try to.

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Q

Would you agree with me that Santa Cruz and Novell at the

time of the transaction were experienced companies in software transactions? A Q A Yes. They were both large companies? We were a $200,000,000 revenue company at that time.

Novell was larger. Q Would you agree with me that the transaction between

Novell and Santa Cruz in 1995 was an arms-length transaction? Mr. NORMAND: THE WITNESS: Objection to form. Yes. We were two separate companies,

and there was no other connection between them. Q Would you -- you have no reason to believe that either

company was in an unfair bargaining position at the time of the deal? MR. NORMAND: THE WITNESS: Objection to form. I don't think so.

Would you agree with me that the contract is the most important item in determining what the terms of the deal are? MR. NORMAND: THE WITNESS: Q A yes. Objection, asked and answered. And you want my opinion on that?

Asking for your understanding based on your experience. I think contract is one of the most important things,

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Q

And based on your experience and understanding, companies

make their business decisions based upon the terms in a contract; is that right? MR. NORMAND: THE WITNESS: Q Objection to form. Yes.

And if there's a dispute in the future after a

transaction, the first thing the parties would look to is the contract to determine what the terms of the deal were; is that right? MR. NORMAND: THE WITNESS: Q Objection to form. Yes.

And oftentimes disputes, such as in this case, they don't

arise until many years down the road? A Q Many years? Yes.

And would you agree with me that when they do, the

contract is the best evidence of the parties' rights and obligations under the deal? MR. NORMAND: THE WITNESS: Q Objection to form. Yes.

This is a Santa Cruz press release dated December 6th,

1995, entitled "SCO Takes Major Step in Consolidating Unix System Market". A Q Uh-huh. And below that it says, "SCO Completes Agreement With

Novell, Significantly Increasing Market Strength; Industry

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Partners Endorse". A Q Uh-huh. And do you see the -- again, the date of this was

December 6th, 1995, which was the date of the closing of the Novell/Santa Cruz deal. A Q A Q Yep. Do you recall that? I see it here, yeah. Is this one of the press releases that you would have

reviewed in -- as your -- in your role as Chief Executive Officer of Santa Cruz? A Probably, I just don't recall this particular -- a

specific press release. Q The second full paragraph it says quote: "SCO has

already planned a stream of product and technology releases reaching beyond the year 2000. These releases will include

the next release of the SCO UnixWare system in 1996; the next release of SCO OpenServer system in 1996; a Compatibility Tool Kit in 1996 for creating applications that run on both the SCO UnixWare system and the SCO OpenServer system; and a 1997 release that merges the SCO UnixWare system and the SCO OpenServer system. SCO is also working closely with its

strategic allies, HP and Novell, to develop a highly -- a high availability, high RAS, 64 bit Unix system for the next generation intel architecture expected to ship in 1998."

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A Q

Uh-huh. As you sit here today, do you have any reason to believe

that this was not Santa Cruz' plan after the closing of the Novell/Santa Cruz transaction? A I have no recollection that it wasn't our plan. We always

Generally at -- I remember at SCO we had road maps.

had road maps on our products, and they would have had events like these. road map. Q And this press release that was issued on December 6, So it does not look unusual that we would have a

1995 is what Santa Cruz was telling the marketplace its plans were going forward; correct? A Some aspects of it, yes. That particular paragraph you

just read, it talks about future years. Q And you see where it talks about release of a merged

product in 1997? A Q Yes, it does. That's what I read right now.

And I'll hand you another exhibit that we'll mark as Mr. Mohan, this is another press release dated

exhibit 72.

September 20, 1995 entitled "HP, Novell and SCO to deliver high volume Unix OS with advanced network and enterprise services". A Q A Uh-huh. Do you see that? Yes.

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Q A Q A Q

I'm referring to the second bullet point -Uh-huh. -- on page one -Uh-huh. -- where it reads, and I quote: "SCO has purchased the

UnixWare business from Novell and will consolidate its SCO OpenServer system and Novell's UnixWare into a merged high volume intel-based Unix operating system that provides interfaces in common with HP-Unix." A Q A Q Yes, I see it. Is that consistent with your memory of the transaction? Yeah. I'm going to get into that in a second. The Do you see that?

consideration that was paid from Santa Cruz to Novell as part of the Asset Purchase Agreement was Santa Cruz' issuance of stock to Novell; right? A Q A Q Yes. And I'd ask you to turn to page two of the contract. Yeah. And do you see subparagraph-A? stock"? It says, "Consideration

for assets: A Q Yes.

And I quote:

"On the terms and subject to the conditions

set forth in this agreement, as full payment for the transfer of the assets by buyer to -- by seller to buyer, at the

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closing buyer shall assume the assumed liabilities and issue to seller 6,127,500 shares of fully paid and non-assessable shares of common stock to buyer." A Q Yes. Is that consistent with your memory that Santa Cruz paid Do you see that?

Novell 6,127,500 shares of stock for this purchase? A Yes. It's in this agreement, and I've signed this I assume the data is correct. But if you're

agreement.

asking if I remember 6,127,500, I do not remember the exact number, but it's here on this document. Q A Q A Q A Q A Q A Q Do you know who Steve Sabbath is? Yes. Who is Steve Sabbath? Our legal counsel. Is he the lead legal -Yes. -- Counsel for Santa Cruz? Yes. Did you trust Mr. Sabbath's judgment at the time? Yes. When you use the phrase asset purchase agreement, are you

referring to the September 19th, 1995 agreement? A Q Yes. So, again, let me make sure I'm clear. It is your

testimony --

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A Q

Uh-huh. -- that the September 1995 contract reflects the intent

of the parties concerning what the deal was about? A The -- it's -- if you read the whole thing in its

entirety, it -- it reflects what we were trying to do. Q Let me ask this question. Do you have any contractual

basis at all as we sit here today for your belief that the Unix business was transferred to Santa Cruz in its entirety? A My belief is that the APA in its entirety gave us the

right to the business. Q Let me ask the question again. As you sit here today,

can you point me to any specific contractual provision in support of that belief? A Short of going through the document line by line, I -I -- I can

I -- I can't tell you the answer to that question.

tell you what the APA was, what the intent was, what we were trying to do, and it was the purchase of the Unix business. Q So you would need to go through this contract to answer

that question; is that right? A Q Probably. Paragraph four of your declaration says, "I have reviewed

the declarations of Jim Wilt October '04, and Steve Sabbath, October '04." A at. Yeah. That's the one -- that's the ones I've looked

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Q

Were you -- at any point were you ever aware that Steve

Sabbath had submitted a second declaration? A Q A After this? Or before? I -- I was not aware -- I'm aware of it now that there Before?

was an earlier declaration, but not when I looked at the 10-04, and I do not know of any declaration after 10-04. Q Are you aware that in Mr. Sabbath's other declaration he

stated that Novell retained significant rights after the asset purchase agreement, including the Unix copyrights? A I just found out about the -MR. NORMAND: THE WITNESS: or so. Q So we're handing you exhibit 76, which is a December Do you see that? Objection to form. -- Previous declaration the last day

22nd, 2003 declaration of Steve Sabbath. A Yep. MR. NORMAND: moment? THE COURT: MR. NORMAND: have a sidebar? THE COURT: MR. NORMAND: THE COURT: You may. Yes.

Your Honor, can we stop the tape for a

Can we stop the tape for a moment and

Thank you, Your Honor. On the record?

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MR. NORMAND:

Yes.

(Bench conference discussion according to the reporter's ability to hear and understand). THE COURT: Counsel, I want you to speak up. The

jury can't hear you no matter what, so speak loudly and clearly. MR. NORMAND: Your Honor, I can try to find the

documentation, but I had believed that we had objected to this and it had been excluded. It's clearly hearsay on its face.

He's citing a declaration that someone else has signed. Mr. JACOBS: Your Honor. Let me introduce Mr. Daniel Muino to

He's been working on these designations as we try

to keep up with SCO's designations. Mr. MUINO: THE COURT: Mr. MUINO: Good morning, Your Honor. Good morning. As I recall, I believe we had agreed as

to a horse trade on this whereby this testimony from Mohan would come in for the exchange for something else. have to -(the reporter interrupted due to an inability to hear clearly). I believe we had come to an agreement on this. There may I think we

have been a misunderstanding, but I thought we had agreed to keep this in exchange for testimony that you had objected to in the course of our negotiation on this.

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MR. NORMAND:

I apologize to Your Honor.

I wish we

had a record here that reflects this.

It's hard for me to It's so clearly

imagine I would have wanted this to come in. hearsay.

But I have no reason to dispute Mr. Muino's And I don't want to keep

description of what he understood. Your Honor or the jury waiting.

I'm not sure I have a great

solution other than the two of us taking three or four minutes and trying to check our notes. acceptable to Your Honor. THE COURT: Why don't we do that. Let the jury So I don't know if that -- that's

stand, get their attention back to where it ought to be. why don't you take the time you need and see if we can't reconcile this. MR. NORMAND: Mr. MUINO: THE COURT: Thank you, Your Honor. Thank you. Ladies and gentlemen, we're going to

take a brief recess, but here in the courtroom.

So if you'd

like to stand for a few minutes while the attorneys do some quick consulting. (brief pause) MR. SINGER: Your Honor, we apologize. We sorted it

The video can continue. MR. JACOBS: Your Honor, with your permission, we're

just going to roll back about 15 seconds to start the sequence over.

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THE COURT:

That will be fine.

Before you do

though, if you'll hold on. Ladies and gentlemen, I have to ask you this. During the

sidebars, do any of you hear anything that is being said, even close? A JUROR: THE COURT: A JUROR: THE COURT: Go ahead. So we're handing you exhibit 76, which is a December Do you see that? No. You can see our lips move? Just a lot of fuzz. All right, thank you.

22nd, 2003 declaration of Steve Sabbath. A Q A Q Yep.

I'd ask you to turn to page 6, paragraph 11. Uh-huh. It reads, quote: "Under the Asset Purchase Agreement,

Novell retains significant Unix related assets following the sale. For example, schedule 1.1(b) of the Asset Purchase

Agreement provided that much of the Unix System V intellectual property would not be transferred to Santa Cruz by listing the following items as excluded assets." And then it goes on to

quote Roman V on intellectual property from excluded assets. "A: all copyrights and trademarks, except for the trademarks Do you see that?

Unix and UnixWare." A

Uh-huh, I see it.

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Q

Do you agree with Mr. Sabbath's statement in paragraph 11

that we just read? A No. As I've stated so many times to you, I believe that

we were buying the Unix business, and we were buying the complete business, except for the economic financial binary revenue stream. That was my intent. That was what my belief

is, and it still is belief, irrespective of number 11 on page six on this old document, which is not something I'd seen before. Q A Q Mr. Mohan, I'm -- I've handed you exhibit 80 -Yes. -- which is the proxy statement -- I'll represent to you

is the proxy statement that was sent to Santa Cruz shareholders. A Q Okay. Can you just look -MR. JACOBS: Your Honor, at this point we would like

to move into evidence Novell's Exhibit J10, which is a Santa Cruz proxy statement sent to shareholders. We will trim

this exhibit so that only the relevant pages are provided to the jury. We'll be looking at pages 132 and 133. THE COURT: MR. NORMAND: THE COURT: Any objection? No objection, Your Honor. It will be admitted.

(Defendant's Exhibit J10 received in evidence)

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Q

Look at the first couple pages of this, which are letters

from Steve Sabbath to the shareholders describing what this document is. A Q Yep. Do you have any reason to believe this is not a proxy

statement that was sent out to shareholders on around 2001 prior to the Caldera transaction? A Q I have no basis. And do you see that on page 132 there is a description of

Santa Cruz' intellectual property, runs from page 132 to 133? A Q Uh-huh. I'd ask you to take a look at that, please. THE COURT: we had Mr. Normand do? Mr. JACOBS: Thank you, Your Honor. I think the Mr. Jacobs, do you want to read that as

jury can read along with us pretty quickly, and I'd rather not use the time for that. THE COURT: All right.

Did you all get that read? A JUROR: THE COURT: has not? All right. Mr. JACOBS: Your honor, I think if anyone is still We're not that fast. Have you all now read it? Anyone who

reading it on the jury, the next question and answer sequence

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will make clear the point of this excerpt in any case. THE COURT: A Q Go ahead, please.

Do you want me to read all of page 133? Just the section called intellectual property that begins

on 132 and runs onto 133. A Q Okay. Do you see that nowhere in this intellectual property

section does Santa Cruz claim to own the Unix copyrights? A If you're asking if I can read English and say there's no

word copyright, my answer is yes, there is no word copyright in here. Q Did anyone from Novell at the time of the Asset Purchase

Agreement ever say to you or any representative of Santa Cruz that SCO, after the transaction, would own the Unix copyrights? A Again, the same answer. No one from -- that I work with

from Novell, which would be limited people, Frankenberg and Duff Thompson, they did not speak to copyrights, so they did not tell me that they'd kept it. given it to us. Q They did not tell me they'd

So it's neither in nor out.

To your knowledge, at the time of the Asset Purchase

Agreement did anyone from Santa Cruz expressly say to Novell, "We want the Unix copyrights as part of this transaction"? A I would -- I would not know that. I -- that level, and I

don't recall any such -- I would not know that.

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Mr. JACOBS: witness, Your Honor. THE COURT:

That completes the testimony of this

Thank you, Mr. Jacobs.

Mr. Normand, if you would, please, your next one. MR. NORMAND: Your Honor, we next call -- we propose

to present the designations of Doug Michels, who was at Santa Cruz. THE COURT: MR. NORMAND: THE COURT: The deposition was taken when? March 28th, 2007. Thank you.

(Douglas Michels called as a witness via video deposition) -- September of '95 at SCO? Dates aren't my favorite thing, but as best as I can

determine, I was probably CTO At that point, Executive Vice-President and CTO. Q A Are there other possibilities or are you -I was there for 20 years and I had half-a-dozen titles,

and it never really changed my job much, so I never worried about what the title was. Q Well, how would you characterize your participation in

the Asset Purchase Agreement negotiations? A Well, I was very involved in the initiation of it, and I

was very involved in the strategy behind it, and I was very involved in the high level structure of the agreement, and I was involved in supervising pretty directly the people who

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were negotiating the details of the agreement. Q When you say you were involved in the initiation of the

agreement, can you tell me what you mean by that? A Well, unfortunately this is a very long time ago, and I'm

really bad at dates and, you know, trying to -- trying to get, you know, remote facts in exactly the right order. But, you

know, the discussion of essentially acquiring Unix had been going on for ten years. And before Novell even bought Unix we

were involved in discussing it with A.T.& T. And so I believe this particular round that went to the Asset Purchase Agreement was kicked off by Mike DeFazio contacting me at a Uniform conference and opening up the discussion. I mean I know he contacted me and I know he

opened up the discussion, and I'm pretty sure that it was that conversation that went to the Asset Purchase Agreement, but it could have been -- it could have been a different iteration. I'm not a hundred percent sure. ten year process. Q Understandable. Can you put even a rough time frame on This was as a -- as I say, a

Mr. DeFazio's initial conversation with you? A Well, we'd have to go identify when Uniform in Dallas

was, but I suspect it was, you know, within a few months of the negotiations getting serious. Q You also said that you were involved in the strategy of Can you tell me more about what

the Asset Purchase Agreement.

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you meant by that? A Sure. It's a big -- a major decision for the company So the whole issue of did

to -- to, you know, make that bet. we want to own it?

Did -- what did we want to do with it? I mean That was

How do we figure out how to pay for it?

all -- that was all, you know, discussions that were strategic in nature and that I was involved with. Q And you also mentioned that you supervised the people who Who were those people?

negotiated the deal. A

Primarily Jim and Geoff and some of the legal people, but

the real business development team was Jim Wilt and Geoff Seabrook. And, again, I don't recall whether -- whether they

were directly reporting to me at that point or not, or one of them was and one of them wasn't. I mean, again, over the years they often reported to me, and I worked very closely with -- whether they were reporting to me or someone else, we worked very closely as the team and business development was one of the -- one of my main roles. I met with them regularly, and whatever issues came up that they had trouble resolving, they would -- they would come to me, so -Q Apart from your initial meetings with Mr. DeFazio, did

you have other meetings face-to-face with Novell personnel as part of the APA negotiations? A Yes.

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Q A Q A Q

With whom? I don't remember. How -- how many meetings would you say? Two or three. Okay. Do you recall the time period of those? Earlier? Was it

close to the execution? A Q Both.

Do you recall anyone who was at -- present at those

meetings, either from your side or from Novell? A Well, certainly Jim Wilt and Geoff Seabrook and I think

Ed Chatlos, some of the legal -- some of the legal people. Q A Do you recall any of the legal people? Kim Madsen on our side. I don't remember the names of

the Novell legal people. Q Do you have an understanding as to what the purpose of

the Asset Purchase Agreement was? A Q Sure. What is your understanding of the purpose of the Asset

Purchase Agreement? A We were buying the original A.T.& T./Unix business from

Novell, who had bought it from A.T.& T. Q And what's the basis for that statement? What leads you

to say that? A Q That was the deal. Um --

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A

That's what Mike and I talked about in Dallas and that's

what the deal was, was Novell didn't want it anymore, we'd always wanted it. "Yeah." Q He said, "Do you want to buy it?" I said,

We bought it.

I want to talk a bit about some of the subsidiary related

agreements that came along with the Asset Purchase Agreement. Did you have any involvement in the negotiation of the technology licensing agreement? A Yeah. I tried to stay completely away from the actual

mechanics of the agreement and stick to who was getting what. And what was in which piece of paper, I mean, I completely -you know, had a great business development team. good legal team. We had a

You know, as long as they found the right

way to engineer the documentation to match what -- what we had agreed at a business level needed to happen, you know, as to which agreement did what, you know, that wasn't my job. Q I take it then the answer is no, that you didn't have

involvement in the actual negotiation of the technology licensing agreement? A I don't know if I did or not. I had involvement in

what -- what we got or what they had or who did what, which document it went into, I don't know. Q Do you recall seeing drafts of the technology licensing

agreement? A I saw stacks of paper on people's desks.

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Q A Q

But do you have any specific recollection of -Did I read them? Do you have any specific recollection of seeing drafts of

the technology license agreement? A I'm sure they were in the stacks of paper on people's

desks that I saw, but I didn't read them. Q How about the Operating Agreement? Do you have any

recollection of being involved in the negotiation of the Operating Agreement? A deal. Same answer. I was involved in the negotiation of the

I was involved in the several page summary that all And I was involved in

those agreements stemmed from.

determining, you know, what we would give and what they would give. And when issues came up about how would something work,

because in writing the agreements they would come up against some -- some edge condition, and then they might bring it to me and say, "Well, what do you think should happen in this edge condition?" do it. And we'd discuss it, and they'd go off and I'm sure I was.

So was I involved in the agreement.

Do I know which agreement evolved out of which discussion? No. Q To clarify, you don't have any memory of being

specifically involved in the negotiation of the Operating Agreement? A I was specifically involved in the negotiation of all the

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agreements, but I don't know what agreements were -- resulted from what conversations. process. I was involved in the entire

I had daily discussions with the people doing the

negotiation, and they would come to me with issues and concerns and discussions about how should something work. never asked them, "Well, does that go in the Operating Agreement or does that go in the Technology License Agreement?" Q I didn't care. Didn't matter to me. I

I understand that you were involved in the deal

generally, and I understand the testimony you've given so far. What I'm trying to do now is compartmentalize that a bit and see if you have any memory specific to particular agreements? A Q I have no memory specific to any specific agreement. Did you have any involvement in the negotiation of

Amendment No. 1 to the Asset Purchase Agreement came a few months later? A Q A Same answer. No memory specific to -I was involved in the discussions leading up to every I was not focused on what pieces of paper came out

agreement.

of those discussions. Q Continuing in paragraph nine of your declaration on page

two, the last sentence of it reads, "There was no intent to grant Novell any rights to waive or to direct or require SCO

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to waive any of its intellectual property rights or protections contained in the Unix licenses." for that statement? A Q We bought the whole business. Except for certain revenue streams though; isn't that What's the basis

right? A We bought the whole business. We partially paid for it

with the residual revenues from certain contracts. Q A As to those contracts, did Novell retain any rights? It was purely a financial arrangement. We bought the

whole business.

The only rights they retained was rights

preventing us from arbitrarily destroying that revenue stream. Q A What rights were those? Well, I mean if -- if we were to go to the customer and

say, "Okay, you don't have to pay anymore," then they would have to approve that because that would be damaging their revenue stream. Q And I -- so I understand your testimony, and what I'm You've testified about

trying to do here is drill down a bit.

the intent of the deal, and you're testifying specifically about the intent as applied to Novell's rights, and I want to know why you believe this is the intent. that was told to you? A Is this something

Is this something -- you know --

This was the agreement that I reached with Novell, that

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the group meetings -- I mean it was clear from day one in our strategy we were buying the business. the customers. We needed to control

We didn't need to be -- have Novell also

talking to our customers. The reason that -- even on the residual revenue stream that they essentially got all the money, we said we're going to collect the money for you because we don't even want you talking to our customers at all. That was the discussion.

The reason we demanded the five percent was we needed that just to cover our costs to collect the money because we were collecting it on behalf of Novell because they were not to ever talk to our customers. them collect the money. I mean that was clearly discussed by all parties, that we were to be the complete relationship management of that -- of all customers, and we should be the only ones ever talking to them. Q And what I'm talking about is something a little more Novell retained Otherwise we would have just let

specific than that than relationship manager. certain revenue streams, we've agreed.

And Novell has argued

in this case that it retained certain rights with respect to those contracts. One of those rights is the ability to

command SCO to do certain things as concerns those contracts. I take it that's inconsistent with your memory of the negotiations; is that right?

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A Q

That's correct. And tell me more about why it's inconsistent with your Can you come up with anything

memory of the negotiations. specifically? A Yes.

Our -- our agreement with Novell was that we were We would have all relationship How can

buying the entire business.

management and account control with those customers.

you have all account control if somebody else can order you to do something with them? inconceivable. Q Doesn't make any sense. It's

We would never agree to that.

Did they say at any point during -- did Novell convey

that it didn't have the authority to direct SCO to make changes to SVRX licenses at any point to you? A said. As I said, I'm talking about their actions, not what they Their actions were that they made direct contact with a

customer and directly modified the license agreement with a customer, and we said that's a breach of contract, and they negotiated a settlement. Q I take it then the answer to my question is no, you never

heard Novell say something like that? A Q I'm not saying that. Okay. I'll ask you the question again. Did you ever

hear Novell tell -A Q You know --- you that -- that they did not have the authority to

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direct SCO to take actions as concerned SVRX licenses? A We had a very long discussion, set of discussions, with And you're

Novell about the incorrect actions they had taken.

asking me to recall specific conversations that happened ten years ago, and I don't. But in those conversations they did

acknowledge that maybe they had exceeded the rights under their license agreement, and they were willing to enter into settlement discussions. Q What was your involvement in those agreements? Did you

for example draft any of the language of those agreements? A Q Oh, sure, of course. I love to write legal contracts.

I take it the answer is no, you did not write any of the

language in those agreements? A No, I did not write any of the language in those

agreements. Q A You're not going to go to law school? I was involved in the discussions about the settlement

and what we would be willing to settle for and, you know, what -- you know what -- what we needed them to agree to do to avoid this happening in the future. and what amendments, I don't know. Q Do you recall reviewing any of the drafts of the How it got implemented

agreements that surrounded this, whether it be Amendment No. X or Amendment No. 2 or whatever agreement? A We always worked from term sheets. And term sheets are

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things that lawyers don't write. easy to read. term sheets. Q They're clear.

They're simple.

They're I reviewed

They're in English.

So I take it then the answer is no, you do not recall

reviewing any drafts of the actual language of the amendments or agreements that took place as part of this? A Only to the extent that it was the same as the language

in the term sheet, which it may or may not have been. Q Do you recall there being term sheets as part of this

effort to resolve this dispute? A There was some form of term sheet. What form it was in,

whether it was e-mails or whether there was an actual, you know, Word document, I don't know. But there was definitely a

short English summary of what the terms of the settlement would be. Q And I take it you were involved in the term sheet portion

of this -A Q A Q A Yes --- Negotiation? Absolutely. Who else was involved in that? Alok, and I'm sure Geoff, Steve Sabbath, Kim. I don't

know who else. Q You testified this morning that one of the purposes of Do you recall

the APA was to buy the original Unix business.

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that? A Q Yes. Was one of the purposes of the APA to buy the UnixWare

business as well? A Yeah. What I meant was the intent was to buy the

business that had originally started at A.T.& T. and Bell Labs, and then became U.S.L., and then was acquired by Novell, and then -- and that -- that whole business is also what created UnixWare. But I mean we bought the employees and the

body of that business, which included everything they ever did, which obviously included UnixWare, as well as SVR IV and SVR III and SVR V. Q Do you recall -- independent of how it was embodied in a

particular agreement, do you recall the issue of a license back to Novell in -A Yes. We wanted to make sure that that license didn't

give them any rights to go back into the Unix business or to use that technology other than had incidentally perhaps crept in. And so we -- we did effectively grant them rights to Unix

technology as necessary to protect them from any incidental use of Unix inside of their existing products. Q And did you have an understanding at the time as to the

basis on which Santa Cruz granted Novell rights to the Unix technology? A The basis, what do you mean?

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Q

Was it your view that Santa Cruz owned rights in the Unix

technology as of the date of the license back to Novell? A Of course. We bought the business. And as a result of

buying the business, we owned all the intellectual property. Q Was it ever your understanding when you were at Santa

Cruz that in order to acquire any Unix or UnixWare copyrights, Santa Cruz was obligated to go back to Novell and make a case as to why Santa Cruz needed the copyright? A Q A Q Of course not. Did any attorney -We owned the business. Did any attorney from Santa Cruz ever tell you any such

thing? A Q No. Did any executive or any employee of Santa Cruz ever tell

you such thing? A Not that I can recall. If they did, I would have laughed

them out of my office. Q Let me direct your attention to paragraph nine, which you You say in the last

looked at earlier with Mr. Melaugh.

sentence, quote, "There was no intent to grant Novell any right to waive or to direct or require SCO to waive any of its intellectual property rights or protections contained in the Unix licenses," end quote. A Yes. Do you see that language?

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Q A Q

Does that language accurately reflect your intent? Yes, it does. I have a few follow-ups. Let's begin where we left

off -- or he left off.

And Mr. Normand just listed through a

series of bases for your testimony about the intent of the deal. One of those bases was communications back from SCO What specific communications back from SCO

employees.

employees were you referring to? A Again I had close, close interaction with particularly

Geoff Seabrook and Jim Wilt, as well as Kim and Steve and the legal department and had, you know, virtually daily e-mails or phone calls or conversations. Q A Q Okay. Continuous conversations I mean. Can you recall any specific e-mail, telephone

conversation, in-person conversation that has informed the testimony that you've given today? A Oh, sure, ten years ago on Tuesday I think it was -- no, I mean we talked daily.

of course not. Q

I'm going to -- I'm going to ask the same thing about

each of the topics Mr. Normand went through, but maybe we can shortcut it. A Q That would be nice. What is your opinion as to the scope of that phrase,

namely, copyrights required for SCO to exercise its rights,

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and so on? A

What copyrights does that include?

I mean I believe the scope of the term here is all Source code,

copyrights relating to the Unix business:

documentation, screens, you know, training materials, you know, brochures, marketing literature. I mean, you know,

there's millions of copyright things in a business. Q Why are all those copyrights required for SCO to exercise

its rights with respect to the acquisition? A We took over the business. We were in the business of We were in the business of We were in the business

selling intellectual property.

supporting the intellectual property. of providing training. marketing materials. owning the copyrights. Q Just one question.

We were in the business of providing We couldn't do any of that without

You said in response to a question

from Mr. Melaugh that you assumed to the copyrights we're going over. A Q A Do you recall using words to that effect?

Okay, I might have. To the extent that you did, what did you mean by that? I meant that the only way I know of and anyone on my team

knew of to buy a software business is to buy the copyrights. And there's no way we would have ever done a deal to buy a software business where we didn't get the copyrights and all the other intellectual property. That's what you're buying.

And especially in the case of Unix with its convoluted

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intellectual property history and whatnot, to not -- to not get that stuff would be to not do the deal. And so it was implicit in everything we did, everything we thought. Every single person on my team understood that. The business development people

The lawyers understood it. understood it.

I mean it's just -- it's so essential it's, I mean there's no way that

you know, like breathing oxygen.

deal could have happened without getting the copyrights. Q A What's the basis for that testimony? And we had, you know, many meetings, many dinners. I

mean it was just implicit.

It's in the -- it's in the water.

I mean you -- you don't buy software companies without buying the intellectual property, and you don't buy the intellectual property without buying the copyrights. Q But no one from Novell ever said to you, "We're

transferring the Unix copyrights as part of this deal"? A Q A I have no idea what people said ten years ago. You don't have a memory of someone saying that? Specific words? I have no memory of any specific words

at all from ten years ago. Q A Or words to that effect? You know, I'm not going to testify to words I don't I know that -- I know with certainty that everybody

remember.

involved understood the copyrights were part of the deal. Q Did anyone from Novell -- I believe you were asked did

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anyone from Novell ever tell you that Novell owned the Unix copyrights. Did anyone from Novell ever tell you that SCO

owned the Unix copyrights between the time of the Asset Purchase Agreement and 2001? A You know, the reason I can say with certainty that nobody

from Novell ever said that they did is because that's so preposterous a thing, I would remember it. Q Well, Mr. Normand asked you I think a fairly specific

question, whether SCO held itself out to be the owner of the Unix copyrights -A Q A Yes. -- between 1995 and 2001? We thought ourselves to be the owner of everything. We owned the product. We

owned Unix.

We spent a lot of money. Of course

We gave away 20 percent of our company to buy Unix. we held ourselves out to be the owner of Unix. Q

I'm talking specifically about copyrights in this

instance. A In my mind they're not separable. If you own UNIX, you

own the copyrights.

It's a legal distinction that you're I

making that doesn't parse to a -- to a normal human being. don't -- I don't know how to answer your questions. jibberish. Q It's

Apart from the license deals, are you