SCO Grp v. Novell Inc

Filing 864

NOTICE OF FILING OF OFFICIAL TRANSCRIPT for dates of March 19, 2010-Jury Trial before Judge Ted Stewart, re 567 Notice of Appeal,. Court Reporter/Transcriber Patti Walker, CSR, RPR, CP, Telephone number 801-364-5440. 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 Three, # 2 Part Three)(jmr) Modified by removing restricted text on 7/19/2010 (rks).

SCO Grp v. Novell Inc

Doc. 864 Att. 1

1 2 3

THE COURT: MR. SINGER: MR. BRENNAN:

Is there anything, Counsel? Not from us, Your Honor. Your Honor, we had conferred We have agreed that

4 about the Ryan Tibbitts deposition.

5 we can continue that discussion so we can give a 6 description later. 7 8 9 working -10 11 12 13 14 15 THE COURT: MR. BRENNAN: THE COURT: You have one more break, then. Thank you. Ms. Malley. THE COURT: MR. BRENNAN: Okay. I want to let you know, we were

(Jury brought into the courtroom.) THE COURT: MR. NORMAND: Mr. Normand, is this your witness? Yes. We would call as the next

16 witness, by video deposition, Maureen O'Gara, who was 17 deposed on March 23, 2007. 18 19 20 21 22 23 24 25 Q. A. Q. A. Q. THE COURT: Thank you.

(Designated portions of the deposition were played, as follows:) What do you do for a living? I'm a journalist. And how long have you been a journalist? Since about 1972. Do you cover a certain particular industry? 1650

Dockets.Justia.com

1 2

A. Q.

Yes.

I cover the computer industry.

And how long have you been covering the

3 computer industry? 4 5 A. Q. Since 1972. Are you aware that Novell has issued an

6 announcement claiming that Novell, and not SCO, owns the 7 UNIX copyrights? 8 9 A. Q. Yes. I'd like to now show you a document that will It's a document that contains

10 be marked as Exhibit 1080.

11 an article entitled Novell To Try To Shoot Down SCO IP 12 Claims, by Maureen O'Gara. 13 14 15 A. Q. Do you see that article within the document? Yes, I do. And does that appear to be the document that we

16 were just talking about in which you wrote about Novell's 17 announcement about its alleged ownership of UNIX 18 copyrights? 19 20 21 22 A. Q. A. Q. Yes. And what's the date of the article? It's dated May 28. And, again, is that consistent with your

23 recollection of the article and the announcement? 24 25 A. Yes. MR. NORMAND: Your Honor, SCO moves into

1651

1 evidence Exhibit 172 based on the foundation that 2 Ms. O'Gara just laid. 3 4 5 6 MR. HATCH: THE COURT: No objection, Your Honor. It will be admitted.

(SCO Exhibit 172 received in evidence.) MR. NORMAND: Mr. Calvin, could you put that up

7 for the jurors. 8 And Mr. Calvin, Your Honor, has highlighted the

9 language that Ms. O'Gara is going to be subsequently 10 asked about. 11 Q. Before you published this article, did you

12 speak with Novell? 13 14 A. Q. Yes. Did you speak with someone named Chris Stone of

15 Novell? 16 17 A. Q. Yes. And what was Mr. Stone's position at Novell, if

18 you knew at the time? 19 20 A. Q. I believe he was vice-chairman. What did Mr. Stone tell you about Novell's

21 public announcement in which he was going to assert its 22 purported ownership of the UNIX copyrights? 23 A. Well, he informed me of the substance of what

24 the story is about, that they were going to -- what is 25 the right word -- assert their ownership.

1652

1

Q.

Did he say -- did he say anything about the

2 reasons why they were issuing that announcement on that 3 date? 4 5 6 A. Q. A. Yes, he did. And what did he say? He said they were doing it because SCO's

7 earnings were that day. 8 Q. And did he say anything about the effect, the

9 intended effect of the announcement on that date? 10 A. The reason that they were doing it, as I

11 understood it, was to confound SCO's stock positions. 12 Q. And when you say "confound SCO's stock

13 position," can you be a little more specific or can you 14 clarify in any way? 15 A. Well, I think the object of the game was to

16 throw a monkey wrench into the works. 17 Q. Well, when you say that they were trying to

18 confound or throw a monkey wrench, what -- can you 19 explain that in some other way? 20 A. They were trying to upset, upset the stock

21 price. 22 Q. And when you say "the stock price," whose stock

23 price? 24 25 A. Q. SCO's. I'm sorry. SCO's.

Did Mr. Stone say anything about harming SCO?

1653

1

A.

Logically, there wouldn't be any other

2 reason. 3 Q. So, you -- you understood that to be the

4 intent? 5 6 A. Q. That's what I understood. Do you know if there is any reference to your

7 conversation with Mr. Stone that we've been talking about 8 in this article? 9 A. Yes, I do. In the one, two, the third

10 paragraph. 11 12 13 Q. A. Q. Okay. And it begins, "The letter." Would you read -- you can go ahead and read

14 that into the record. 15 16 17 A. Q. A. Is that all right? Yeah. "The letter which Novell is supposed to post to

18 its website today, right before SCO reports its quarterly 19 results-- " 20 21 Q. A. Can you continue? "-- says that Novell owns the IP and that SCO

22 merely shares in certain rights that it acquired from 23 Novell by way of the original SCO, the old Santa Cruz 24 Operation." 25 Q. And did you write that paragraph as part of

1654

1 this article? 2 3 A. Q. Yes. Did he say anything more than SCO is supposed

4 to report its quarterly results on May 28? 5 A. He led me to understand that the reason that

6 they were doing it on the 28th, that they were posting 7 their -- their cease-and-desist letter, was because SCO 8 was -- had its earnings report. 9 Q. So, I understand you to be saying that he led But I need to --

10 you to understand something. 11 12 A. Q. He said -You're on to it.

I'm trying to figure out

13 what you -14 15 16 17 18 A. Q. A. Q. A. Yeah --- took away from it versus what he -No --- actually said to you. No. There was no -- there was no lack of

19 clarity. 20 Q.

There was no lack of clarity, sir. Well, then, what was clear in exact -- in his

21 words versus what you took away from it? 22 A. He was saying to me that the reason that they

23 were doing this was because of SCO's -- SCO's earning 24 report. I'm sorry. And I'm -- it's just -- that's just

25 the way it is.

1655

1

Q.

And so my question to you is, is it your

2 testimony, under oath, that Mr. Stone conveyed to you, in 3 words, that the reason Novell was doing this announcement 4 on the 20 -- on the date it was doing it, was so it would 5 be coincident with SCO's report of its quarterly results? 6 7 A. Q. Yes. And what words or substance of the conversation

8 do you precisely recall him using in order for him to 9 convey that, as opposed to you to infer it? 10 A. Maybe it was the laughter that I remember most

11 about it. 12 13 Q. A. All right. So tell me about that.

Well, he basically -- I guess the right --

14 maybe the right way to characterize it was chortled. 15 16 Q. A. And what do you recall of the chortling? That was at the end of the -- our conversation. I think

17 It was shortly after we, you know, we hung up.

18 we had been on the phone for a little bit of time going 19 through all this. And he explained to me -- and that's

20 why it appears in this story, that the coincidence -- it 21 appears in this story because he drew my attention to it. 22 Q. And did -- so, I think we have chortling at the And we have --

23 end of the conversation. 24 A. About that.

It wasn't, you know, like -- it

25 was about, about the fact that they were putting out

1656

1 the -- their statement on that day. 2 laughter was about. 3 Q.

That was what the

So, let me see if I have accurately captured

4 the back and forth over the last few minutes. 5 6 A. Q. Okay. One. Mr. Stone said to you, "We are releasing

7 a statement about the ownership of the UNIX copyrights." 8 Two. Mr. Stone drew your attention to the fact that SCO And,

9 was reporting its quarterly results the next day. 10 three, Mr. Stone chortled? 11 A. Okay.

There is an absence of causality in

12 there. 13 14 Q. A. You have put your finger on my question. All right. And so the step that's left out is

15 that there was a connection between these, step A and 16 step B. 17 Q. And my question is, what did Mr. Stone say that

18 specifically identified that connection, as opposed to 19 you inferring from the -20 A. I'm sorry. I'm not inferring, all right? I

21 don't remember the exact words, but it wasn't an 22 inference. It was a statement. And I would only be I can't remember

23 putting, you know, words in his mouth.

24 it, the exact words, but the meaning was quite clear. 25 Chris Stone told me that they were going to drop this

1657

1 little bomb shell on SCO, and they were going to do it on 2 the 28th of May because that was the day that SCO's 3 numbers were coming out. 4 Q. And that's what you conveyed to SCO's counsel

5 in the lobby of the hotel? 6 A. I think that that's, yes, an accurate

7 statement, yes. 8 9 him? 10 11 A. Q. No. And Mr. Stone didn't use the word "bomb shell" Q. You didn't use the word "bomb shell" with

12 with you? 13 14 15 16 17 18 19 A. Q. A. Q. A. Q. A. No. Bomb shell is your characterization today? Right. Now, if you look at -But that's what it was intended to be. That's the way you understood it? No. That was the way the world was supposed to

20 understand it because -- because it is a bomb shell, 21 sir. 22 Q. And so my question for you is, when you think

23 of this concept of causality, what do you have in mind as 24 being the cause and the effect, as you understood it? 25 A. All right. Let me recount. My understanding

1658

1 is that -- no. 2 understanding.

Let me rephrase that.

It's not my

What happened was that Novell put out a If it owned UNIX,

3 statement saying that it owned UNIX.

4 then SCO didn't have a leg to stand on. 5 Q. Is it fair to say that you don't recall the

6 specific words that Mr. Stone used when he talked about 7 the causality, as you have been saying? 8 9 A. Q. Right. But is it clear in your mind that he conveyed

10 to you this notion of a causality? 11 12 A. Q. Yes. And, specifically, that he conveyed to you that

13 the reason for the timing of Novell's announcement was to 14 impact, or as you said earlier, to upset the price of 15 SCO's stock? 16 17 A. Yes. MR. NORMAND: Your Honor, that completes SCO's

18 Designations. 19 20 21 THE COURT: Mr. Jacobs? MR. JACOBS: Your Honor, Novell has some All right. Thank you.

22 additional testimony of Ms. O'Gara. 23 24 THE COURT: All right.

(Whereupon further designations of Ms. Ogara's

25 deposition were played as follows:)

1659

1

Q.

Ms. O'Gara, do you have any notes of your

2 conversation with Mr. Stone? 3 4 A. Q. No. Is it your practice to take notes as you're

5 talking with sources? 6 7 8 9 10 11 A. Q. A. Q. A. Q. My notes are more in the way of just phrases. Phrases that people say to you? Yeah. So you can capture the words they used? Right. What do you recall of the exact words Mr. Stone

12 used with you in reporting to you the planned 13 announcement? 14 15 A. Q. I can't. You saw no news value in a statement to you by

16 a Novell executive that conveyed to you that the reason 17 Novell was releasing its statement on a particular date 18 was because SCO was reporting its quarterly results that 19 same date? 20 A. I know that that seems, in isolation, like that But, there were so

21 should be really important, okay?

22 many issues in this very complicated matter, that that 23 would make a great side bar or a followup, maybe, but we 24 were talking about something else in this story, and I 25 thought -- I didn't know where it was all going to go,

1660

1 and I've known Chris a long time. 2 protective. 3 Q.

Sometimes I get

When you conferred with the public relations

4 people at SCO; first of all, were you conferring with 5 Blake Stowell? 6 A. Conferring? I don't confer with the PR people.

7 I called Blake Stowell, yes. 8 Q. Well, that's, I guess, my question is, so,

9 what -- why did you forward for this string of e-mails? 10 11 A. Q. I have absolutely no -Let me finish -- let me finish my question.

12 Why did you forward this string of e-mails from Frank 13 Jalics, J-a-l-i-c-s, in which he accused you of being 14 on -- in a nut shell, on SCO's side? 15 16 A. Q. Yeah. Why did you forward that to SCO under an

17 e-mail, "I want war pay."? 18 A. I don't remember the context of the thing,

19 but -20 21 22 Q. A. Q. Do you remember why you forwarded it? No. Does it strike you as peculiar that a

23 journalist would forward to one of the sides in a dispute 24 a string of e-mails she got from a reader? 25 A. I don't -- I don't know what the right answer

1661

1 to that question is because I don't know the context. 2 3 Q. A. Well, what's the context here? I'm probably just complaining about getting People can't

4 this kind of crap, you know, all the time.

5 read and don't know what the heck is going on and got it 6 wrong to begin with, just -- just, you know, saying that, 7 you know, you think you've got it tough, Blake, you 8 should see it from my side. 9 10 Q. That's no big deal. And then you forwarded that string to

11 Mr. Stowell with a, what I took to be a kind of a 12 humorous remark, "I want war pay." 13 14 A. Q. Right. And then Stowell says back to you, "Keep

15 fighting the good fight." 16 17 A. Q. Right. So, let me show you another e-mail. We'll mark

18 this as 191.

This is one that you would not have seen So, if

19 before but I think it's important that you see.

20 you look at your -- at the e-mail highlights of what 21 looks to be an Adobe Acrobat attachment -22 23 A. Q. What do you mean e-mail highlight? Your e-mail highlights, "As against the

24 backdrop of a thin IBM response to SCO's billion dollar 25 suit against it, SCO claims it has found line-for-line

1662

1 plagiarism of SVR V in Linux and has renewed its threat 2 to pull IBM's SVRX license in six weeks." 3 4 A. Do you see that? This indicates to me that this is a list of In some -- some copies of our e-mail

5 headlines.

6 distributions, in the front they -- they have a list of 7 the headlines. So, the first story -- these are 01 is a story with that headline. I don't -- 03 and 04. 02

8 different stories.

9 is a story with that headline. 10 Yeah. 11 So what? MR. JACOBS:

Your Honor, at this point Novell

12 would move to admit A-14. 13 14 15 16 17 THE COURT: MR. NORMAND: THE COURT: Any objection? No objection, Your Honor. It will be admitted.

(Novell Exhibit A-14 received in evidence.) MR. JACOBS: And Mr. Lee has highlighted the

18 portion of this e-mail that Ms. O'Gara will testify to 19 next. 20 Q. Okay. So the lead story there is IBM Tries

21 Non-defense Defense -22 23 24 25 A. Q. A. Q. Yeah. -- Against Billion Dollar SCO Suit. Yeah. And you send that to your readers, and Blake

1663

1 Stowell forwards it internally under an e-mail to Darl 2 McBride, the CEO of SCO -3 4 A. Q. Yeah. -- which says, "Once again Maureen is coming We own the entire front page."

5 through for us. 6 7 8 A. Q.

Do you see that? Yeah. So what?

So my question for you is, was Mr. Stowell

9 working with you -10 11 A. Q. No. -- to get prominent coverage for the SCO/IBM

12 lawsuit? 13 14 A. Q. No. Absolutely not. Absolutely not. Never.

So, this is an e-mail to you dated May 30, Do

15 2005, Exhibit 196 produced under SCO 1647696 to 697. 16 you see that? 17 18 19 20 21 22 23 24 A. Q. A. Q. A. Q. I don't see a date on it. Right at the top. Oh, there it is. "I need you to send a jab PJ's way." Do you see that? Uh-huh. Who is PJ? MR. JACOBS:

Novell moves into evidence S-45,

25 Your Honor.

1664

1 2 3 4 5 site. 6 7 Q. A. A.

MR. NORMAND: THE COURT:

No objection, Your Honor. It will be admitted.

(Novell Exhibit S-45 received in evidence.) PJ is the purported author of the Groklaw

What is the Groklaw site? It is a website that follows the SCO case -- I

8 should say cases, maybe, but -9 Q. And then you did, in fact, write a story about

10 PJ or Pamela Jones, didn't you? 11 12 A. Q. Yes. So, in 196, Stowell says in the subject line,

13 "I need you to send a jab PJ's way," and that's March 30 14 2005? 15 16 A. Q. Yeah. And 197 is your May 9 to 13, 2005 issue of

17 Client Server News 2000, correct? 18 MR. JACOBS: Your Honor, Novell moves into

19 evidence D-14. 20 21 22 23 24 25 A. Q. A. MR. NORMAND: THE COURT: No objection, Your Honor. It will be admitted.

(Novell Exhibit D-14 received in evidence.) Yeah. And the lead story is Who is Pamela Jones? Yeah.

1665

1 2 3

Q. A. Q.

Right? Yes. Is there -- is there a causal relationship

4 between Blake Stowell's e-mail to you and the appearance 5 of the story in Client Server News 2000, May 9 to 13, 6 2005? 7 8 9 PJ -10 A. I have reason to do a story on Pamela Jones A. Q. No. You did it independently? You did the story on

11 that has nothing to do with SCO. 12 Q. And, in your -- in that article you said, "A

13 few weeks ago, I went looking for the elusive harridan 14 who supposedly writes the Groklaw blog about the SCO v. 15 IBM suit." 16 17 18 19 A. Q. A. Do you see that? Yes. What is a harridan? I suppose I could look it up in the

20 dictionary. 21 22 23 24 25 Q. A. Q. A. Q. Why did you use the word? Because it's accurate. In what way is it accurate? Have you read Groklaw? I'm sorry. I get to ask the questions.

1666

1

A.

If you read Groklaw, you would know that

2 harridan was the right word. 3 4 Q. A. Well, let's look -There is a difference between a good word and

5 the right word. 6 Q. Let's see if you agree with this definition. Noun. A woman regarded as scolding and

7 "Harridan. 8 vicious." 9 10 A. Q.

Hum. Is that why -- is that a definition that

11 applies to your use of the word "harridan" in -12 13 14 15 A. Q. A. Q. I think it's accurate. Scolding and vicious? Uh-huh. As you sit here today, are you -- do you have

16 any regrets over printing 197? 17 18 A. Q. No. You don't have? Do you have any regrets about

19 finding the identity -- reporting information, personal 20 information about Pamela Jones? 21 22 A. Q. No. And, again, "Who is Pamela Jones" had nothing

23 to do -- the story on 197, your testimony is, it had 24 nothing to do with Blake Stowell's March 30, 2005 e-mail 25 with the subject "I need you to send you a jab PJ's way."

1667

1

A.

I think he defines what the jab would be, which

2 is something that we ignored, you know. 3 4 5 6 testimony. 7 8 9 10 Maciaszek. 11 12 THE COURT: All right. JOHN MACIASZEK, THE COURT: All right. Thank you, Counsel. Q. A. The answer is? No. MR. JACOBS: That concludes our additional

Next witness? MR. HATCH: Your Honor, we would call John

13 the witness hereinbefore named, being first duly 14 cautioned and sworn or affirmed to tell the truth, the 15 whole truth, and nothing but the truth, was examined and 16 testified as follows: 17 MS. MALLEY: And if you would please state and

18 spell your name for the Court. 19 THE WITNESS: John Maciaszek, spelled,

20 M-a-c-i-a-s-z-e-k. 21 22 23 BY MR. HATCH: 24 25 Q. A. Good morning, Mr. Maciaszek. Good morning. MS. MALLEY: Thank you.

DIRECT EXAMINATION

1668

1

Q.

I've got a little bit of a flu, so I hope you

2 can hear me. 3 A. Well, I'm fighting a little bit of a cold

4 myself, so we can commiserate. 5 6 Q. We'll all have it eventually. Could you give us a brief description of your

7 educational background. 8 A. Yes, I got a bachelor's degree in mathematics

9 from St. Peter's College in Jersey City. 10 Q. What did you do after you graduated from

11 college? 12 A. Well, simultaneously with graduation, I was

13 commissioned in the U.S. Army and went in and served two 14 years with the Headquarters XVIII Airborne Corp in Fort 15 Bragg, North Carolina. 16 17 Q. A. Did you remain in the military? Yes. After I got off of active duty, I served

18 20 years as a reservist and retired in 1987. 19 Q. Okay. Going back to when you got done with

20 your active duty, did you then go into the workforce? 21 A. Yes. I was employed by AT&T Bell Laboratories

22 in Holmdel, New Jersey. 23 Q. And at Bell Laboratories, what was your first

24 job there? 25 A. I was a software developer.

1669

1

Q.

Okay.

And did you receive advancements during

2 your time there? 3 4 5 A. Q. A. Yes, I did. What did you end up -- the last job you had? Well, I was a product manager and for parts of

6 the microsystems business that AT&T was doing at that 7 point in time. 8 Q. Okay. At some point, did you begin to work on

9 the UNIX operating system? 10 A. Yes. In December, 1991, I transferred to USL,

11 which was a fully separate subsidiary of AT&T at the 12 time, and I became a product manager for UNIX products. 13 14 Q. A. Okay. What does a product manager do?

Well, I mean, a product manager is sort of like

15 a -- I like to put it as sort of like an orchestra 16 leader. The job is to ensure that all parts of the

17 company, all the different aspects required to put a 18 product into the marketplace, work together to make the 19 product as good as it's going to be. 20 That includes working with engineering, working

21 with sales, working with marketing, manufacturing, 22 licensing and legal to get all the pieces together to 23 bring the product to market. And, once it's out there,

24 your job is to support the sales force as well and plan 25 for future revisions of the product.

1670

1 2 USL? 3

Q.

How long did you do that for AT&T's subsidiary

A.

Well, I did that until USL was acquired by

4 Novell, I think it was in 1993, and subsequent to that I 5 moved to SCO and then Caldera. 6 Q. Okay. When you went to Novell, did you

7 physically move? 8 A. No. We stayed in the same location

9 initially. 10 11 12 Q. A. Q. And did your job change at all? No, not in any way, shape or form. Okay. And when you went -- when Novell then

13 sold the business to Santa Cruz Operation, did you change 14 locations? 15 16 17 18 A. Q. A. Q. No. Did your job stay the same? Essentially, yes. Okay. So, is it fair to say for most of the

19 last 18 years, you have been working with the UNIX 20 system? 21 22 A. Q. That's correct. Now, at some -- when did you become aware of

23 the sale of the UNIX business from Novell to Santa Cruz 24 Operation? 25 A. Well, it was some time after the signing of the

1671

1 initial APA.

We were notified.

I think it was Mike

2 Defazio who was in charge of the Novell UNIX business at 3 that time and informed all the employees of the pending 4 sale. 5 This was prior to the closing date, obviously. THE COURT: Mr. Maciaszek, could I get you to

6 speak into the microphone a little bit more? 7 8 9 10 Q. THE WITNESS: THE COURT: THE WITNESS: BY MR. HATCH: Sure. Thank you. Sorry. What did Mr. Defazio tell the

11 workers at your shop about the sale? 12 A. Well, I mean, basically what he said was the

13 entire business, UNIX business, was being transferred 14 from Novell to SCO. 15 Q. SCO was purchasing the business.

Did he say that -- did he say whether Novell

16 was retaining anything from the business? 17 A. No. Our understanding was that the business

18 was being transferred in its entirety to SCO. 19 Q. Okay. Now, was the business run any

20 differently when you were under the umbrella of Novell 21 than it was when you were under the umbrella of USL? 22 23 A. Q. No. It was fundamentally the same.

And so, at some point, did -- how did the

24 transition happen from Novell to Santa Cruz? 25 A. Well, there were transition teams put together

1672

1 between the time of the initial signing and then, I 2 think, through February of 1996, transition teams which 3 included people from both Novell and SCO to ensure that 4 the business moved in a very smooth and orderly way to 5 SCO. 6 Q. Were you one of the Novell employees that was

7 in charge -- involved in the transition? 8 9 10 A. Q. A. Yes, I was. What was your responsibility? Well, my fundamental responsibility was to

11 bring to market the final product that was listed in the 12 APA, UnixWare, 2.1, get the licenses done for that, as 13 well as to interact with our OEM partners with respect to 14 explaining to them what the new product was and facts 15 about the actual purchase. 16 Q. Okay. Who appointed you to the transition team

17 at Novell? 18 A. Honestly, I can't recall who it was. It might I'm

19 have been Sabbath, Steve Sabbath or somebody else. 20 not sure who the actual person was. 21 Q. Okay.

Now, what -- specifically, what were you

22 told to do as part of this transition team? 23 A. Well, we were told to bring the business

24 completely under the control of SCO. 25 Q. Okay. Were you given statements of work?

1673

1

A.

Yes.

Each -- there must have been, I mean, 15

2 or 20 different transition teams, each of which put 3 together a statement of work as to what items of work 4 they were going to accomplish. I think the target date

5 was February 1 to have it all completed, or certainly 6 shortly there -- after the closing date, and those SOW's 7 were put in detail as to what was going to be done and 8 listed both who was on the team, that particular team, 9 from both SCO and Novell. 10 Q. Okay. let me show you what's been marked as

11 Exhibit 560.

Is this one of the statement of works that

12 you were talking about? 13 A. Yes. This one dealt with the licensing and

14 contract management organization. 15 Q. And I notice that, on the second page, there is

16 a letter here that mentions your name as well? 17 A. Yes. That's correct. I'm familiar with that

18 letter. 19 20 560. 21 22 23 24 Q. MR. JACOBS: THE COURT: No objection, Your Honor. Okay. It will be admitted. MR. HATCH: Your Honor, I would move Exhibit

(SCO Exhibit 560 received in evidence.) Mr. Maciaszek, the jury can now see this. Is that statement of work? It

25 shows -- it says, SOW.

1674

1 2

A. Q.

That's correct. Okay. What's the period of time you said this

3 is for? 4 A. From December 1, or the closing date, until the

5 first of February. 6 Q. Okay . And what did you understand that period

7 to be? 8 A. Well, that was the transition period. The

9 intent is to have everything done by that time and that 10 the transfer of employees would have occurred by the 11 first of February. 12 Q. Okay. Again, you're a Novell employee at this

13 time, right? 14 15 A. Q. That is correct. Okay. Now, the second paragraph, you see where

16 you it says:

Act as SCO's worldwide agent for UnixWare

17 and SVRX and any other Novell source code products being 18 transferred to SCO. 19 20 21 A. Q. Do you see that? Yes, I do. Who is it referring to that's going to act as

22 SCO's agent? 23 24 work. 25 Q. Okay. So your understanding was, who was A. The Novell employees who are going to do the

1675

1 acting as whose agent during this period? 2 A. Well, it was clear that the Novell employees

3 were acting as agents of SCO at that point in time, given 4 at the closing date all the assets were transferred to 5 SCO. 6 Q. Okay. And, down in paragraph 2, responding to

7 customers inquiries about the products and transfer of 8 the ownership to SCO, was that consistent with what you 9 understood was your responsibility as part of this 10 transition team? 11 12 A. Q. Absolutely. Okay. And by "transfer the ownership," what

13 did that mean to you? 14 A. Well, all the asset and intellectual property

15 were moving, and eventually selected people moved as 16 well. 17 Q. Okay. And did you ever -- anybody from Novell,

18 any of your bosses, ever tell you that there was some 19 limitation on what was being transferred? 20 21 A. Q. Absolutely not. Now, I notice for Novell, it was signed by a --

22 who is that that signed it? 23 A. Louis Ackerman, who was the manager of the

24 contracts organization. 25 Q. Okay. Okay. Now, do you know what it means to

1676

1 mark a product with a copyright? 2 3 4 A. Q. A. Yes. What does it mean? Essentially what you're doing is identifying

5 the fact that you are the owner of the product. 6 7 Q. A. Okay. Where is that put on the product?

Well, exteriorly, it would be as part of what I

8 would call the skins of the product, since we are talking 9 about -- if we're talking about shrink-wrapped product. 10 It would be on the outside of the boxes, on the CD labels 11 and also included in the software. 12 Q. Okay. So, as a Novell employee during this

13 transition period, what were you told to do about marking 14 the products? 15 A. Well, the products were to be marked for SCO's Pardon me. And that would include -- when you say "skin,"

16 copyright. 17 Q.

18 what does that mean? 19 A. Well, it would be the boxes. If you go to a

20 store, you buy a software box off the shelf, you look at 21 the outside, it will have a copyright notice on it. If

22 you look at the individual CD's you get as part of the 23 product, it will have a copyright notice as well, 24 identifying who the owner of the copyright is and what 25 the effective dates are.

1677

1

Q.

And you were instructed to do that by your

2 bosses at Novell? 3 4 A. Q. That's correct. Now, during this transition, did Novell take

5 any other steps to notify its customers of the transfer 6 of the business to SCO? 7 A. Well, certainly letters went out to all of the

8 OEM customers that I am aware of, notifying them of the 9 transfer of ownership from Novell to SCO. 10 11 Q. A. Okay. Yes. And were visits made as well? As part of the transition, I participated

12 in visits to the OEM customers, certainly the ones in 13 Europe. I remember vividly making trips to ICL Olivetti So, we went out to make a visit

14 and Siemens in Germany.

15 to make sure they were aware of the fact that the 16 transition was occurring 17 Q. Okay. And there were letters that were

18 involved in that? 19 20 A. Absolutely correct. MR. HATCH: I'd like to have -- like you to put

21 Exhibit 592 on the screen. 22 Q. BY MR. HATCH: And 592 is a large group of I'm just going to

23 letters which were introduced earlier. 24 look at one of these. 25 letter to?

This is a letter -- who is this

1678

1 2 3 4 5 6

A. Q. A. Q. A. Q.

Siemens Nixdorf. All right. Yes, I have. Okay. Yes. Okay. During the entire time you were at Was Siemens one of your clients? Have you seen this letter before?

7 Novell? 8 A. Well, I don't know the entire time, but

9 certainly a goodly portion of the time I had 10 responsibility for interactions with Siemens, yes. 11 Q. Okay. And did you have any dealings with

12 Siemens during this transition period? 13 A. Yes. As I indicated, we made a visit to

14 Siemens in Munich. 15 16 Q. Okay. In the letter --

Let's highlight the first paragraph,

17 Mr. Calvin, if you would. 18 It says: As you may have heard, Novell has

19 transferred to the Santa Cruz Operation, Inc., SCO, 20 Novell's existing ownership in UNIX-based offerings and 21 related products, collectively the transferred products. 22 23 24 A. Q. Do you see that? Yes, I do. Is that consistent with what you were told to

25 tell the customers as part of the transition team for

1679

1 Novell? 2 3 4 A. Q. Yes, it is. Now, these meetings -- well, let's see. Let's go down also -- Mr. Calvin, could you

5 highlight the "please direct" paragraph. 6 7 In the letter it also said: Please direct all future correspondence

8 regarding this matter to SCO at the following address. 9 10 A. Why did he do that? Well, there was a lot of -- first of all,

11 payments of royalties and other things needed to be -- we 12 needed to notify them who the new receiving parties were 13 going to be at SCO for any of that correspondence. 14 15 Q. A. Okay. Why would they -- why would you do that?

Because SCO is now the owner of the products,

16 and all dealings have to go to SCO. 17 MR. HATCH: Okay, Mr. Calvin, would you

18 highlight the signature line. 19 Q. BY MR. HATCH: And, just to be clear, this was

20 a letter coming from Novell, correct? 21 22 A. Q. Yes. You eventually -- did you eventually meet with

23 the people at Siemens? 24 25 A. Q. Yes, I did. Did you meet with them alone?

1680

1

A.

No.

There was a joint team, including both

2 members of SCO as well as Novell and, at the time I made 3 the visit, I believe -- I'm pretty sure I was still a 4 Novell employee. 5 6 Q. A. Why were you taking SCO employees? Well, SCO employees were being taken to

7 introduce them to the OEM's and to establish with the 8 OEM's the credibility of SCO which, compared to Novell 9 and previous USL, was a smaller company, and introduce 10 the engineering people, the salespeople that they were 11 going to be dealing with going forward, to make sure 12 that -- excuse me -- the customers were confident that we 13 could continue, and I use the "we" in the sense, since I 14 was part and parcel of the transition, could continue to 15 carry on the business and the interactions as they were 16 used to having it done. 17 Q. Okay. What was communicated to the customer,

18 Siemens, in this case about the ownership? 19 A. Well, Siemens was informed, in concert with,

20 you know, reiterating what we sent to them in the 21 letters, that, in fact, SCO had acquired all ownership 22 rights to the business. 23 Q. Okay. Now you met with other customers as

24 well, correct? 25 A. That's correct.

1681

1

Q.

Let me give you what's been marked as SCO

2 Exhibit 751. 3 4 5 6 A. Q. A. Q. Yes. Are you familiar with this letter? Yes, I am. Okay. This is a letter -- is this part of your

7 transition as well? 8 9 yes. A. Well, this came -- the original letter was,

The subsequent letter, signed by Mr. Murphy, was a

10 followup to the original letter. 11 Q. Okay. Let's -- you were part of the -- the

12 original letter you say is starting at page 2? 13 14 A. Yes. That's correct. Your Honor, I would move admission

MR. HATCH:

15 of Exhibit 751. 16 17 18 19 Q. MR. JACOBS: THE COURT: No objection, Your Honor. It will be admitted.

(SCO Exhibit 751 received in evidence.) BY MR. HATCH: All right. Let's start on the

20 second page.

This is a January 29, 1996 letter to Tad

21 Tung; is that right? 22 23 A. Q. That's correct. This is similar to the letter we just saw with

24 Siemens that went off early in the transition period? 25 A. Similar, yes.

1682

1 2

Q.

And had similar language. Just highlight the first few lines in the "this

3 is to inform" paragraph, Mr. Calvin, if you would, 4 please. 5 6 Just do the whole paragraph. It says: This is to inform that you with respect to each

7 of the Novell offerings listed on Attachment A, for which 8 you are currently licensed, Novell's right as licensor 9 under such agreements have been assigned to the Santa 10 Cruz Operation. 11 12 A. Do you see that? Yes, I do, basically telling them that the

13 business had transferred. 14 15 Q. Okay. Now, you had indicated -This is a

Let's go two back to the first page.

16 letter also to Tad Tung.

If we could go to the date June

17 19, 1996, so about five months later, correct? 18 19 A. Q. That's correct. Why were you having further communications with

20 Tad Tung? 21 A. Well, my understanding is that Tad Tung -- the

22 original letter was something that Tad Tung needed 23 clarification on for their own purposes. I'm not sure

24 what their legal rationale was, but they needed something 25 that was signed by all parties.

1683

1

Q.

Okay.

They wanted both sides to admit that

2 this had happened? 3 4 A. Q. That's correct. Okay. And if we go down, let's see, the first

5 line it says: 6 As you are aware, the ownership of the UNIX

7 operating system has been transferred from Novell, Inc. 8 to the Santa Cruz Operation. 9 10 11 A. Q. Do you see that? Yes. All right. And that was consistent with what

12 the communications you were having with the customers? 13 A. Oh, absolutely, and it's consistent with the

14 original letter that was sent to Tad Tung in January. 15 Q. I hate to have to ask this, but was there any

16 limitation ever? 17 18 A. Q. No. Their only concern was that they wanted to make

19 sure both sides were agreeing? 20 21 A. That's correct. MR. HATCH: All right. If we can go down to

22 the signature page, Mr. Calvin, if you would, or the 23 signature line 24 25 Cruz? Q. BY MR. HATCH: It was signed by who for Santa

1684

1

A.

That was Bill Murphy, who had been with Novell

2 and had transferred to Santa Cruz in the contract 3 organization. 4 5 Q. A. Okay. And by Novell?

Cindy Lamont, who was also part of the --

6 originally part of the contract organization and stayed 7 with Novell. 8 Q. Okay. And was your understanding that this was

9 sufficient for Tad Tung? 10 11 A. Q. Absolutely. Yes. Tad Tung countersigned it.

Now, these customers you were visiting, what

12 kind of customers were they? 13 A. Well, they were OEM's. That's original

14 equipment manufacturers is what that abbreviation stands 15 for. Fundamentally what they were is they were source

16 code licensees who had the rights to make derivative 17 works of UNIX code and begin shipping those products 18 themselves. By making a derivative work, they sort of

19 customized it to operate most efficiently on their 20 hardware systems, which they sold the two together. 21 22 23 to -24 Q. Just stop there. What does that mean, to make Q. A. What rights did an OEM customer typically get? The got the right to make derivative works and

25 a derivative work?

1685

1

A.

Well, it means to take the original source

2 code, the original source code that we delivered as part 3 of their license, and make modifications to that code to 4 customize it for their own use on their own hardware. 5 6 Q. A. Okay. What other rights did they get?

They had the right also to make distribution of

7 the resulting product that they created and to -8 obviously, as part and parcel of that, they paid 9 royalties for the privilege of doing that. 10 Q. Okay. Now, what mechanism did Novell, later

11 SCO, use to grant these OEM manufacturers those rights? 12 A. Well, there were multiple agreements involved,

13 from the source code agreement which covered some 14 generalized terms and conditions, through the actual 15 product license, which would be specific to a particular 16 release of UNIX or UnixWare, coupled with the 17 distribution agreement which allowed them the right to 18 distribute and had some terms and conditions in there 19 like some of the discount schedules. 20 Q. What were the form of those types of

21 agreements? 22 23 24 25 A. Q. A. Q. I'm not sure what you mean. Were they license agreements? Yes. They were all license agreements.

If you weren't able to license to the OEM's the

1686

1 right, to give them the rights you talked about, would 2 you have a viable business? 3 A. No. You wouldn't be able to carry out that

4 business. 5 Q. And what do you have to have to be able to

6 grant those rights? 7 8 A. You have to have ownership. MR. JACOBS: Objection, Your Honor, lacks

9 foundation, calls for a legal conclusion, and 10 speculation. 11 12 Q. THE COURT: Rephrase the question, please. You have to have a license to be

BY MR. HATCH:

13 able to -- the license gives them these rights, as you 14 understand? 15 16 A. Q. That's correct. And do you have an understanding of what you

17 need to be able to have the ability to give a license to 18 a client? 19 A. Well, you need to own -- you need to own the

20 code, and you need to have the copyrights associated with 21 it. 22 That's certainly the way I understand it. Q. So your understanding is the copyrights are

23 required to operate SCO's business? 24 25 A. Yes. MR. JACOBS: Same objection, Your Honor.

1687

1 2 Q.

THE COURT:

Overruled. Now, after the business was sold

BY MR. HATCH:

3 from -- and the transition was done from Novell to SCO, 4 how did the agreements that the business used with its 5 customers change from the way they were when they were at 6 Novell? 7 A. They were identical, save the change in name.

8 In other words -- as a matter of fact, if you look back 9 at one of the things that you asked me to look at 10 earlier, it specifically says that we should be doing it 11 that way; namely, you take the existing contracts that 12 Novell was using, and if you're using Word or some other 13 software product, you do a global change of Novell to SCO 14 and substitute the appropriate addresses. 15 the agreements that we used. 16 Q. Do you have an understanding why you would use And those were

17 the same agreements? 18 A. Well, it was multiple, but the main reason was

19 we ensured that the business was carried on in exactly 20 the same methodology, that the customers who we were 21 doing business with understood the licenses and were 22 comfortable that they understood we were doing the 23 business in exactly the same way. And this avoided the

24 need to go out and do all new contracts. 25 Q. You were giving them the same rights as you did

1688

1 when it was Novell? 2 3 4 5 A. Q. A. Q. Yes. And expecting the same payments? Yes. All right. Now, at some point, in 1996, did

6 you become aware that IBM was trying to buy out of its 7 contractual royalty obligations to SCO? 8 9 10 A. Q. A. Yes, I did. How did you become aware of that? I received a phone call. It was either in late

11 March or early April, I don't recall which, but a phone 12 call from Larry Buffard who was a salesman with Novell, 13 responsible for various customers. 14 Q. Okay. So, at this point, you had transitioned

15 over to SCO? 16 17 18 A. Q. A. That is correct. All right. I was in SCO at the time.

What did Mr. Buffard tell you?

Well Larry, who I had known since USL days,

19 basically said that they wanted to do a buyout of the IBM 20 royalties for SVR 3.2 and some other modifications to 21 their agreement. 22 23 Q. A. How did you respond to that? I responded in a negative way, saying I didn't

24 think, number 1, they had the right to tell us to do 25 that; number 2, that I don't think our management would

1689

1 go along with this.

And I immediately escalated and

2 requested that Larry send me a formal letter request as 3 to exactly what he wanted done. 4 Q. Okay. Let me give you a copy of what's been Do you recognize this letter,

5 marked as Exhibit 67. 6 Mr. Maciaszek? 7 8 9 A. Q. A. Yes, I do. Okay.

What is it?

It's the formalized request backing up his

10 phone call to me, laying out more detail of the terms and 11 conditions that they were looking for us to do as part of 12 a letter agreement. 13 MR. HATCH: Okay. Your Honor, I'd move for

14 admission of Exhibit 67. 15 16 17 18 Q. MR. JACOBS: THE COURT: No objection, Your Honor. It will be admitted.

(SCO Exhibit 67 received in evidence.) So, did you -- so, what did Mr. Buffard say in Was it consistent with the phone call? It just expanded on the details, laid out

19 the letter? 20 A.

Yes.

21 what the amount of money was going to be for the buyout 22 and detailed what kind of source code changes that he was 23 looking to have done. 24 Q. All right. Did you take issue with what he was

25 requesting to do with IBM?

1690

1

A.

Well, yes, from multiple levels.

I mean, first

2 of all, a buyout of any kind at that point would fly in 3 the face of a strategic direction of the APA, which was, 4 in effect, to get customers who were on SVR 3.2 and 5 earlier or later releases to move to UnixWare. A

6 customer with a buyout would be not very readily disposed 7 to making a transition, number 1. Number 2, he was

8 asking us to modify source code rights, which we 9 fundamentally objected to. 10 belonged to us. The bulk of that revenue

Number 3, the pricing he was asking for,

11 in my opinion, was ridiculously low. 12 13 Q. A. Okay. Who responded to Mr. Buffard's letter?

Well, I escalated that up through my chain of

14 management, and I believe that a look and/or Scott 15 McGreggor were involved in the process of response. 16 Q. All right. You continued to be involved in

17 this issue, though; is that correct? 18 19 20 179. 21 22 A. Q. Yes. That's correct.

Let me show you what has been marked as Exhibit

Do you recognize this letter? A. Q. Yes. Is this a letter that was worked on by your

23 team at SCO to respond to Mr. Buffard's letter? 24 A. Yes. This was addressed directly to

25 Mr. Frankenberg, who was obviously the top man at

1691

1 Novell. 2 MR. HATCH: Okay. I'd move admission of

3 Exhibit 179 Your Honor. 4 5 6 7 Q. MR. JACOBS: THE COURT: No objection. It will be admitted.

(SCO Exhibit 179 received in evidence.) BY MR. HATCH: The ultimate letter 179 that we

8 are seeing -9 If you go to the second page to the signature

10 block, Mr. Calvin. 11 -- this was sent by Mr. Mohan who, it says

12 here, is president and chief executive officer of SCO; is 13 that correct? 14 15 A. Q. That is correct. And what did you understand was the response

16 going back to Novell? 17 A. Well, essentially saying this was not something

18 we thought should be done and objecting to even the 19 thought of doing it. 20 Q. Did Mr. -- did the letter indicate that -- the

21 issue you raised about paid up licenses? 22 23 24 A. Q. A. I believe it did. Okay. And did it -- were you --

It was consistent, I believe, with my view of

25 what the impact would be on customers moving to

1692

1 UnixWare. 2 3 Q. Okay. And did --

And let's look at the date of that letter,

4 Mr. Calvin, if you would. 5 6 7 8 9 A. Q. A. Q. It was April 23, 1996; is that correct? Yes. And that's consistent with your understanding? Yes, it is. Okay. Now, do you have an understanding of

10 what was -- what Novell did next? 11 A. Well, my understanding is that, essentially,

12 Novell went and did an agreement with IBM in spite of 13 this letter. 14 Q. Okay. And you eventually got a copy of that

15 agreement? 16 17 18 707. 19 20 21 A. Q. Yes, I did. Let me show you what's been marked as Exhibit

Is this the agreement you received a copy of? A. Q. A. Yes, it is. Okay. And what did you understand this to be?

Well, it was the buyout agreement between -Let's put it that way. Your Honor, I'd move admission of

22 well, with IBM. 23

MR. HATCH:

24 Exhibit 707. 25 MR. JACOBS: No objection, Your Honor.

1693

1 2 3

THE COURT:

Okay.

It will be admitted.

(SCO Exhibit 707 received in evidence.) MR. HATCH: Would you turn to the last page,

4 Mr. Calvin. 5 Q. BY MR. HATCH: The letter that Mr. Mohan sent

6 was April 23, correct? 7 8 9 10 11 12 A. Q. A. Q. A. Q. That's correct. What was the date of this letter? The 26th. So, it's three days after Mr. Mohan's letter? Yes. Did Novell bother to have any communications

13 between Mr. Mohan's letter and this agreement they cut 14 with IBM? 15 16 A. Q. Not that I'm aware of. Okay. So, three days later, I notice there is

17 a signature block here for -- it says "Novell, Inc., on 18 behalf of the Santa Cruz Operation." 19 20 A. Q. Yes, I do. Did you have an understanding of why there Do you see that?

21 needed to be a signature block for the Santa Cruz 22 Operation? 23 A. Well, because we were the owners of the

24 contracts. 25 Q. And there was a signature space for that. Who

1694

1 signed on behalf of SCO? 2 3 4 5 6 7 A. Q. A. Q. A. Q. James T. Sullivan. Is he a SCO employee? No. Who was he? He was a V.P. of sales at Novell. All right. So what was your reaction to this,

8 SCO signing a deal -- or Novell signing a deal with IBM 9 and signing on your behalf? 10 A. It wasn't very, you know, favorable. Let's put

11 it that way. 12 13 Q. A. You can't speak of it in open court? Pardon me. I mean, that's a very soft

14 description of what I would think of somebody signing for 15 us. 16 17 Q. A. Now, what was the reaction from SCO? SCO's reaction was essentially the same as

18 mine, not very favorable, and I believe -- well, my 19 understanding is we began to institute a lawsuit against 20 them. 21 Q. Okay. And during this entire time, did Novell

22 ever say that they owned the copyrights or they could do 23 this without SCO's agreement? 24 25 A. No. MR. JACOBS: Objection, Your Honor. The

1695

1 witness lacks foundation for all the statements Novell 2 made to all the people on the SCO side. 3 4 Q. THE COURT: Well, rephrase the question. Did anyone at Novell ever tell

BY MR. HATCH:

5 you that they could do this without SCO's agreement? 6 7 A. Q. No. Did they ever tell you that they owned the

8 copyrights and could do whatever they wanted? 9 10 A. Q. No. As a matter of fact, they kind of -- your

11 understanding is that they put Santa Cruz Operation, SCO, 12 into the signature block because you had to sign it, 13 right? 14 15 16 A. Q. A. That's correct. Okay. How was this matter resolved?

Well, ultimately, it got resolved -- there were

17 multiple thrusts, but there was an Amendment 2 signed to 18 the agreement, the APA, which effectively closed out this 19 kind of nonsense in the future, made it very clear that 20 this could not be done without joint approval by both 21 parties, and either one could simply say, "I didn't want 22 to do it" and didn't need to justify it. 23 Also there was a revised agreement signed with

24 IBM which was called Amendment X and then there was a 25 closure agreement where SCO agreed not to sue IBM and for

1696

1 which there was a payment. 2 3 Q. Okay. Mr. Calvin, Exhibit 08, which has been received

4 into evidence. 5 6 7 admitted. 8 Q. BY MR. HATCH: Is this the amendment that THE COURT: MR. HATCH: What was the number again? 08. I believe it has already been

9 you're talking about? 10 A. Yes, Amendment Number X and Roman numerals

11 called 10 or X, depending on how you want to read it. 12 MR. HATCH: Okay, Mr. Calvin, could you go to

13 the signatures page. 14 Q. BY MR. HATCH: So, after you resolved all the

15 issues, then, this time there was, again, a signature 16 space for Santa Cruz Operation, right? 17 18 A. Q. Yes. At this time, it doesn't say Novell on your

19 behalf, right? 20 21 22 SCO? 23 A. Steve Sabbath, who was our V.P. of corporate A. Q. Right. And then who signed it this time on behalf of

24 legal. 25 MR. HATCH: That's all I have, Your Honor.

1697

1 2

THE COURT:

Mr. Jacobs. CROSS EXAMINATION

3 BY MR. JACOBS 4 5 6 7 8 Q. A. Q. A. Q. Good morning Mr. Maciaszek. Good morning. Good to see you well, sir. Thank you. You understood that Novell thought it had the

9 rights to enter into the buyout agreement with IBM in the 10 winter of 1996, correct? 11 A. I don't know what they thought, but obviously I don't believe they had the right, but --

12 they didn't. 13 Q.

Let me ask you to take a look, sir, at Novell Do you see you're a recipient of the e-mail

14 Exhibit K-6.

15 at the top of the string, Mr. Maciaszek, in 1996? 16 17 18 evidence. 19 20 21 THE COURT: MR. HATCH: MR. JACOBS: Any objection to K-6, Mr. Hatch? Objection. Hearsay, Your Honor. A. Yes. MR. JACOBS: Your Honor we off K-6 into

It's not hearsay, Your Honor.

22 It's an e-mail exchange at the time with Mr. Maciaszek 23 that informed his understanding, which I just asked him 24 about. 25 THE COURT: I will overrule the objection.

1698

1 2 Q.

(Novell Exhibit K-6 received in evidence. BY MR. JACOBS: Mr. Maciaszek, that's an e-mail

3 to you from -- on April 1, 1996, correct? 4 5 A. Q. Yes, it is. And it says -- and you're sort of copied on it.

6 From Biff to Jeff, or Jeff to Biff, I guess -- no, Jeff 7 to Biff. 8 9 A. Q. Yes. These are people you are working with at SCO at

10 the time, correct? 11 12 A. Q. Yes. And the e-mail says -- it's referring to SVRX Do you see that? Yes. And SVRX licenses were the preexisting UNIX

13 buy-outs. 14 15 A. Q.

16 licenses that SCO was administering and collecting the 17 royalties for under the asset purchase agreement, 18 correct? 19 20 21 A. Q. Yes. And the e-mail says: I believe that Novell views that a section of That

22 the asset transfer agreement gives them that right. 23 section is the one that deals with Novell being the

24 company that can change terms on existing UNIX licenses 25 and direct SCO to make those changes. I think Novell

1699

1 would also view that only they have the ability to 2 renegotiate the existing agreements. 3 4 5 6 A. Q. Do you see that? Yes, I do. And then, Biff goes on and says: That is my understanding from reading the It

7 agreements and from discussions while at Novell.

8 seems you think the intent of the agreement was different 9 from SCO's viewpoint. Given that, we need to talk in

10 depth and determine what SCO should do to force 11 clarification. 12 13 14 A. Q. Do you see that? Yes, I do. So you understood that Novell genuinely

15 thought, at the time, that it had the right to do buyouts 16 of SVRX agreements, correct? 17 A. Well, that certainly was Biff's position at

18 that point, yes. 19 Q. Did you e-mail him back and say, "No, I don't

20 think Novell thinks that." 21 22 A. Q. I don't recall. And, in fact, you became familiar, over the

23 course of this matter, with 4.16 of the asset purchase 24 agreement, and you know the provision that Biff is 25 referring to in that e-mail, don't you?

1700

1

A.

Well, 4.16 was originally crafted and

2 unmodified, but it was changed in Amendment 2. 3 4 5 Q. A. Q. With respect to buyouts, sir, correct? Correct. And, in fact, it worked both ways, right? SCO

6 could not enter into agreements relating to buyouts 7 without Novell's participation, correct? 8 9 A. Q. That's correct. And, in fact, SCO entered into an agreement

10 with SUN that related to a SUN buyout without Novell's 11 participation in 2003, didn't it, sir? 12 A. That was not a buyout, as I understood it, but,

13 yes, if you want to put it that way. 14 15 Q. A. What is an SVRX license, sir? Well, an SVRX license, I guess it would be

16 vaguely defined, but it would be any of the SVR 4.0, 4. 17 whatever, 4.1, 4.2 and prior licenses, as all the prior 18 products thereof. 19 Q. And is there any limitation as to what

20 component of the package of agreements that you testified 21 to on examination by Mr. Hatch, is there a limitation as 22 to what component of those agreements constitutes an SVRX 23 license? 24 A. Not that I'm aware of, no, but I don't think

25 it's completely defined in there either.

1701

1

Q.

It's true, is its not, sir, that SVRX license,

2 the term is kind of a creature of the asset purchase 3 agreement? 4 5 A. Q. Yes. That's correct.

It didn't really have a meaning in the -- in

6 your business before the asset purchase agreement? 7 8 A. Q. That's correct. And it's also true that, in 1996, you were

9 briefly involved in the -- I'm sorry -- in the potential 10 litigation that Santa Cruz was going to bring against 11 Novell arising out of this disagreement about the IBM 12 buyout, correct? 13 14 15 sir? 16 17 18 19 20 21 22 Q. A. Q. Yes. Let me show it to you. THE COURT: MR. JACOBS: THE COURT: MR. JACOBS: What number is this, Mr. Jacobs? 248, Your Honor. I'm sorry? 248. SCO Exhibit 248. A. Q. Peripherally, yes. In fact, you signed a declaration, did you not,

BY MR. JACOBS:

Would you check for me, sir, You have

23 that that is your signature on the back page. 24 that? 25 A. Yes.

1702

1 2 3 4

Q. A. Q.

And it's dated June 13, 1996? Yes. And if you would take a look -Your Honor, may I publish to the jury paragraph

5 21, the paragraph I'm about to ask him about? 6 7 THE COURT: MR. JACOBS: Why don't you offer it first. I will offer, for the limited

8 purpose of paragraph 21, Your Honor, SCO Exhibit 248. 9 10 11 or not. THE COURT: MR. HATCH: Mr. Hatch? Your Honor, I mean, either it's in I

I don't think he should be able to read it. He has the

12 think it's hearsay and it shouldn't be in.

13 opportunity to ask him about this, and I don't think he 14 has gotten to the point -15 THE COURT: Mr. Hatch, I didn't understand what

16 your objection is. 17 MR. HATCH: I'm going to object to -- hearsay.

18 And it's not -- if he's using it for Impeachment, I don't 19 think he's set it up for that, yet. 20 MR. JACOBS: I'll do it whichever way you want,

21 Your Honor. 22

I'm happy to ask him -He may be right. You probably

THE COURT:

23 ought to set more foundation -24 25 MR. JACOBS: THE COURT: Sure. -- if you're going to be using this

1703

1 exclusively for impeachment purposes. 2 MR. JACOBS: Actually, I was trying to refresh

3 his recollection as to what he said in 1996 with 4 precision, Your Honor. 5 6 7 8 9 jury? 10 THE COURT: No. Let's have him look at it and THE COURT: MR. JACOBS: THE COURT: MR. JACOBS: Okay. Can I use it for that purpose? Yes. May I publish paragraph 21 to the

11 see if he can have an answer to your question about it. 12 Q. BY MR. JACOBS: Based on paragraph 21 of your

13 declaration, Mr. Maciaszek, do you recall that the IBM 14 SVRX license was -- consisted, among other things, of 15 SOFT-00015 and SUB-00015A? 16 A. Those would be two components of their total

17 licenses, yes. 18 Q. Thank you, Mr. Maciaszek. Now let's talk for a

19 minute about UnixWare.

You mentioned in Mr. Hatch's

20 questioning of you that part of your responsibility was 21 the transition of the UnixWare product that was under -22 that was undergoing work, at that time, between Novell 23 and Santa Cruz, correct? 24 25 A. Q. Yes. And that release was going to be UnixWare 2.1?

1704

1 2

A. Q.

That is correct. And you were instructed to put the Santa Cruz

3 copyright notice on UnixWare 2.1? 4 5 A. Q. Yes. The then current release of UnixWare that was

6 going to go out from Santa Cruz, correct? 7 8 A. Q. Yes. UnixWare is an amalgam of code from a variety

9 of sources, correct, sir? 10 11 12 13 A. Q. A. Q. That's correct. It includes Netware code, correct? Yes. Did you think that, by putting the Santa Cruz

14 copyright notice on UnixWare 2.1, you were claiming 15 copyright ownership to Netware? 16 17 A. Q. No. So, we have to be a little more grandular,

18 don't we, when trying to -- a little more specific in 19 trying to understand what a copyright notice really 20 means, correct? 21 22 A. Q. Well, one could say that, yes. Similarly, we saw -- we've seen a lot of

23 letters that went to customers in the winter of 1996 that 24 said that Novell had transferred its ownership interest 25 in UNIX, UnixWare, various formulations, to Santa Cruz.

1705

1 You recall the letters that Mr. Hatch asked you about, 2 correct, sir? 3 4 A. Q. Yes. Did you think that those letters were informing

5 the customers that Novell had transferred its ownership 6 interest in the Netware components of UnixWare? 7 8 A. Q. Absolutely not. The customer didn't really need to know that

9 level of detail, did they? 10 A. In terms of what, the imbedded products that

11 were included in the release? 12 13 14 Q. A. Q. Correct. Right. They just needed to know, look, the business is After

15 transferring in some large sense to Santa Cruz.

16 the transition, you're going to deal with Santa Cruz. 17 Correct, sir? 18 19 told. 20 Q. And that was really all they needed to know at A. That was fundamentally what they were being

21 that point, didn't they? 22 A. Well, they needed to know that we had the

23 rights to do what we were doing. 24 And there was no question -- there was no It was very clear that

25 dispute about that, right, sir?

1706

1 Santa Cruz was going to be the face, under the asset 2 purchase agreement, to the customers, right? 3 4 A. Q. Among other things, yes. So they were going to, for example, collect all

5 the royalties and pass them through to Novell on a 95/5 6 percent basis? 7 A. That was part and parcel of what was being

8 done, yes. 9 Q. But the customer really didn't need to know

10 that, did they? 11 A. What, that we were transferring 95 percent?

12 No, I don't think so. 13 Q. So the letters don't say anything to the

14 customers about, oh, by the way, we are going to pass 15 most of the revenue we get from your Legacy licenses back 16 to Novell? 17 A. We also didn't tell them how much we paid

18 for the business, either. 19 Q. So, you kind of told the customers what they

20 needed to know in order for them to interact with Santa 21 Cruz, but you didn't go underneath and tell them all the 22 details of the asset purchase agreement, correct, sir? 23 24 had. A. Right. We would answer any questions that they

That was part and parcel of one of the reasons we

25 visited them.

1707

1

Q.

Under the IBM buyout, in the IBM buyout

2 dispute, there was ultimately a resolution of the matter, 3 correct? 4 5 A. Q. That's correct. And, at the end of the day, Novell actually

6 kept most of the money from IBM, didn't it, sir? 7 A. That's correct, subject to what was given to

8 SCO as part of the settlement agreement. 9 Q. Even given the settlement agreement, sir, most

10 of the money went to Novell? 11 12 13 14 15 BY MR. HATCH: 16 Q. Just so we're clear, when Mr. Jacobs said that How much A. Q. That's correct. Thank you, Mr. Maciaszek? THE COURT: Mr. Hatch?

REDIRECT EXAMINATION

17 IBM -- I mean Novell kept most of the money. 18 did SCO get? 19 A.

SCO received a million and a half dollars.

I

20 think the total sum paid by IBM was approximately 10. 21 Q. So that was more than 5 percent of the total

22 amount paid, correct? 23 24 25 A. Q. A. Without doubt. Okay. Even I can do that arithmetic.

1708

1 2

Q. A.

We don't have to break it down. I would say that was about three times what

3 would be the normal 5 percent. 4 Q. Okay. Now, on this buyout issue, too, when you

5 refer to the buyout that Novell couldn't -- it couldn't 6 be done after Amendment 2, did that refer to buyouts of 7 the old SVRX royalties? 8 MR. JACOBS: Objection, Your Honor. Now we're

9 calling for a legal conclusion about the meaning of 10 Amendment Number 2. 11 12 13 14 MR. HATCH: THE COURT: MR. HATCH: THE COURT: No. What was your understanding?

Just one second, counsel. Sure. There was testimony elicited about

15 Amendment Number 2, I believe by you, Mr. Jacobs, was 16 there not? 17 18 MR. JACOBS: THE COURT: There was, Your Honor. Now, is this to clarify what was

19 raised on cross, or is this something new? 20 MR. HATCH: Well, I think there was some on

21 clarity both from direct and from the cross, so I think 22 it's both. 23 THE COURT: All right. Go ahead and ask the

24 question again. 25

Try not to elicit a legal conclusion. All right. I will try that.

MR. HATCH:

1709

1

Q.

BY MR. HATCH:

What was your understanding of

2 the buyouts that couldn't be done, going forward, after 3 Amendment 2? 4 A. Well, it would have been anything that Novell

5 had a royalty interest in. 6 7 8 Q. A. Q. Okay. Yes. Okay. Now, Mr. Jacobs indicated that customers You remember that The old royalty buyouts?

9 don't need to know everything. 10 discussion? 11 12 A. Q. Yes.

There are some things a customer does need to

13 know, correct? 14 15 A. Q. Yes. Does it need to know who can enforce the

16 copyrights in the contracts? 17 18 19 20 A. Q. A. Q. Yes. And who actually owns the business? Yes. And that's what you were trying to tell them in

21 the Tad Tung and other letters, correct? 22 23 A. Q. That's correct. Now, Mr. Jacobs also asked you about they Do you recall that?

24 didn't need to know about Netware. 25 A. That's correct.

1710

1

MR. HATCH:

Could you bring up, again, the Tad The second page of this,

2 Tung letter.

I think it's 751.

3 if you would go to that, Mr. Calvin, and scroll down a 4 little bit. 5 It says: Among the products included in

6 Amendment A are the specific products for which you are 7 currently licensed by Novell. 8 Is it your understanding that's what was being

9 transferred? 10 11 A. Yes. MR. HATCH: Could you go to the attachment A,

12 Mr. Calvin. 13 Q. BY MR. HATCH: Okay. Mr. Maciaszek, is there

14 any Netware involved in attachment A? 15 16 17 A? 18 A. All of the UNIX and UnixWare products and other A. Q. No. Okay. What's being transferred in attachment

19 associated, what we called auxiliary products in 20 Amendment 1. 21 MR. HATCH: Mr. Calvin, if you could go back to

22 the first page of that exhibit. 23 Q. BY MR. HATCH: And the last paragraph in the

24 letter, Mr. Maciaszek, if you would read that to us, of 25 what Novell said it's doing here.

1711

1 2 3

A. Q. A.

"We attempted to cover all --" The last paragraph. It starts out "By."

"By Novell's counter signature, they

4 acknowledge such transfer has taken place." 5 6 Q. A. Do you understand what that transfer was? All of the assets associated with the UNIX

7 business. 8 9 10 11 Q. Thank you. MR. HATCH: THE COURT: MR. JACOBS: Your Honor, that's all I have. All right. Your Honor, a quick question from

12 here, if I may. 13 14 15 BY MR. JACOBS: 16 Q. Mr. Maciaszek, take a look, again, at THE COURT: Yes.

RECROSS EXAMINATION.

17 attachment A to Exhibit 751. 18 19 A. Q. Yes. The second line is "All UnixWare releases up to

20 and including UnixWare release 2." 21 22 23 A. Q. Do you see that? Yes. UnixWare includes Netware components, does it

24 not, sir? 25 A. Yes.

1712

1

Q.

So your answer to Mr. Hatch was incorrect; This UnixWare is referring to a product

2 isn't it, sir?

3 that embraces code that consists of new code, old code, 4 Netware code, Legacy UNIX code; correct sir? 5 A. Well, that product contains lots of stuff,

6 including third-party code, which we had the rights to 7 because all the contracts were assigned. 8 9 10 Q. A. Q. Under license, sir, correct? Under contractual agreement, yes. But, in saying that we have acquired ownership

11 of those products, you were not intending to convey -12 13 14 15 A. Q. A. We owned the products. And not necessarily -And not every component contained -THE COURT: Mr. Maciaszek. I'm sorry.

16 Mr. Jacob is going to ask you the question. 17 18 Q. THE WITNESS: BY MR. JACOBS: Okay. You and I are actually in sync.

19 You owned the products, as a whole, in the large sense, 20 but there could be old code