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UNITED STATES DISTRICT COURT WESTERN DISTRICT OF NEW YORK ------------------------------------ RICHARD E. GRAHAM, 91-CV-800 Plaintiff, Buffalo, New York -vs- October 13, 1993 LARRY E. JAMES, 9:32 A.M. Defendant. ------------------------------------ TRIAL BEFORE THE HONORABLE JOHN T. ELFVIN UNITED STATES DISTRICT COURT JUDGE APPEARANCES: For the Plaintiff: DENIS A. KITCHEN, ESQ. 8340 Main Street Williamsville, New York 14221 For the Defendant: JAMES OSTROWSKI, ESQ. 384 Ellicott Square Building Buffalo, New York 14203 Court Recorder: JEANNE B. SCHULER Transcription Service: ASSOCIATED REPORTING SERVICE Lower Level One 120 Delaware Avenue Buffalo, New York 14202 716-856-2328 Proceedings recorded by electronic sound recording. Transcript produced by transcription service. P R O C E E D I N G S THE COURT: You can come up here and stand, if you want. Both of you. (Telephone call.) RECORDING: You have reached the office of Stephen Brown in the MIS Department at Gannon University. He is not available at the moment. After the tone, please leave your name, phone number and brief message. He will return the call as soon as possible. Thank you for calling. THE COURT: This is Judge Elfvin in the Federal Court in Buffalo, New York. My telephone number in area code 716 is 846-4226. Please have Professor Brown call at his early convenience. (End telephone call.) THE COURT: All right. Now, on the record, all of this was preceded by colloquy concerning the further testimony, if any, by Professor Brown. It had evolved through the cross examination by Mr. Ostrowski that Professor Brown's analysis had been based upon five, were they modules? MR. OSTROWSKI: Yes, Your Honor. THE COURT: Five modules which he had selected at random and had spent seven hours of work analyzing them. To do a similar analysis on all of the modules which are present would, he said, require an additional four to five days. He said there were 50 to 60 modules there, and to bring him back for, after that for further testimony would, according to his schedule and my schedule, as we looked at that at the end of yesterday when Mr. Ostrowski had left the courtroom, would bring us to Monday and Tuesday, December 20 and 21 of 1993. This has been asserted understandably by and on behalf of Mr. Graham as not being a tasty tidbit in view of the outstanding restraint upon him. It has been developed off that colloquy that Mr. Ostrowski has ended his cross examination of Professor Brown. Mr. Kitchen on behalf of Mr. Graham will have some redirect examination of him, and the contemplation is if it pulls into step with Professor Brown's schedule that we can bring Professor Brown here at 10:30 on this upcoming Saturday and take the remainder of his testimony at that time. Professor Brown is to call back. Does that hit it on the nose or not? MR. KITCHEN: Yes, sir. MR. OSTROWSKI: Yes, Your Honor. THE COURT: All right. And now you have a motion? MR. OSTROWSKI: Yes, Your Honor. THE COURT: This has been -- is it now being filed? MR. OSTROWSKI: Yes. I'm asking the Court to file it. Mr. Kitchen has signed the original, admitting service upon him today. If I may borrow Mr. Kitchen's copy because my laser printer failed. THE COURT: Well, let me first endorse this as filed. Then I can get you your own copy of it, from which you can, which you can use. Oh, you put down a wrong word that was correct, according to the dictionary. MR. OSTROWSKI: Basically, Your Honor, I have two motions. THE COURT: Let me just read it. MR. OSTROWSKI: Sure. THE COURT: I only got to the second line. Without my going back to the confidentiality order, in paragraph 6 you say, defendant's case at trial is seriously handicapped by his inability to examine the programs plaintiff claims are dissimilar to his own, that is, Plaintiff's Exhibit 20 and 21. Now, refresh my recollection as to the aspects of the confidentiality agreement. Namely, what is or are there in there that prohibit Mr. James from seeing material that you, Mr. Ostrowski, can see. I have a slight recollection of such, but I don't have it all in mind. You go on and talk about Mr. James's lack of funds to hire experts while the plaintiff has all this money and has the means to retain two expert witnesses. What he has done is to find two people who qualify as experts to whom he had to pay nothing, Swanson having revamped his goal only on his second appearance. So I don't know. Mr. James doesn't have those touchstones, I gather. MR. OSTROWSKI: Actually, Your Honor, Mr. Swanson had been on retainer and received a large sum of money, not specifically for the testimony, and -- THE COURT: Well, I wondered about that because there is a geographic and other proximity between Swanson and Graham. MR. OSTROWSKI: And with respect to Professor Brown, I find it unbelievable, in spite of his religious background, that he's claimed that he did not expect to be compensated. Given the absolutely incredible amount of hours he said he spent. THE COURT: And willing to spend. MR. OSTROWSKI: And without being able to be cross examined. THE COURT: Well, then he's willing to spend five more days and come back. MR. OSTROWSKI: Well, you know. THE COURT: Without any compensation, other than rewarding his ecclesiastical zeal to see that all is right in the world. MR. KITCHEN: Well, excuse me, Your Honor, but didn't Professor Brown indicate that he had anticipated that there would be some sort of financial arrangement? MR. OSTROWSKI: Not initially. THE COURT: No. MR. KITCHEN: He said -- no -- THE COURT: I don't remember that. MR. KITCHEN: He testified that there was no existing financial arrangement. MR. OSTROWSKI: He said not a penny, I think, initially. THE COURT: What came through to me, and I haven't obviously had the transcript and haven't gone back to listen to it, seemed to me he said he was getting nothing. He, his religious tenets and drive lead him to protect what needs protecting, and to see that things that don't need protecting are not protected. He's going to see that all is right in the world. MR. KITCHEN: That is true, Your Honor, and I think that motivates a great deal of people who end up involved in a variety of cases. Not everybody -- THE COURT: Not as often in this particular field of copyright as in others, perhaps. MR. KITCHEN: Well, not everybody, not everybody who testifies as an expert witness does it for a living, Your Honor. I mean, the man is a full time college professor. His salary will probably not be diminished by his appearance here. But in any event, he was asked whether he anticipated if some financial arrangement would be entered into, and he said that he had. THE COURT: I missed that, if it was said. MR. OSTROWSKI: I think that he later did indicate that he was expecting some cash. With respect to the question of the Court, and just to give a little background, I wanted, in discovery, copies of all the subsequent programs so that I could look at them. Mr. Kitchen raised the issue of trade secret. THE COURT: He didn't want Mr. James to see it. You could, but Mr. James couldn't, is that the idea? MR. OSTROWSKI: Right. So I essentially stipulated to an order that Judge Maxwell signed, on the -- anticipating that we would have this, this material very early, and the expert could look at it, make an opinion, and if it was similar, then go to the Court again and allow Mr. James to see it so then he could get into the program himself and assist in his own, in his own case. So that Judge Maxwell did sign an order on November 24th which states in the relevant paragraph, it is further ordered that such disclosure shall be contingent upon delivery to plaintiff's counsel of a non-disclosure and confidentiality agreement barring either defendant's counsel or expert from disclosing the contents of said programs to anyone, including defendant, without further order of the Court. And as I said, I stipulated pretty much to that order, anticipating that we would have gotten the things a long time ago. But we didn't get them until very, very late, right on the eve of trial. And my, my expert is still looking at them and hasn't been able to come into Court yet, to allow me the foundation to move to strike the order. I'm now moving it, in light of that, those factors, and in light of much of the testimony I'm now moving to strike the order on the following grounds, that there is testimony, particularly from Mr. Swanson, that there are similarities between what is undeniably Mr. James' program, which is, I believe 18 and 19 Exhibits, and Plaintiff's Exhibits -- THE COURT: Plaintiff's 18 and 19? MR. OSTROWSKI: Yeah. I think -- THE COURT: Or 18 and 19 quantitatively? MR. OSTROWSKI: Well, I think the testimony is and will be -- THE COURT: Well, I'm just trying to clarify what you said. MR. OSTROWSKI: -- that 18 -- THE COURT: Two Exhibits or 18 and 19 Exhibits. MR. OSTROWSKI: I'm sorry. Exhibit number 18 -- THE COURT: And 19. MR. OSTROWSKI: -- and 19. THE COURT: All right. MR. OSTROWSKI: 19 is something of a departure, but I think it's, it's already admitted that 19 is substantially similar to 18, which -- THE COURT: Well, it's admitted everywhere except in evidence. MR. OSTROWSKI: I believe that even the plaintiff's witnesses, Your Honor, are now conceding that Plaintiff's -- THE COURT: Well, I say, it's not in evidence. MR. OSTROWSKI: In any event, my own expert has informed me that he believes that 19 is similar to 18. THE COURT: So your expert is mulling through the matter. MR. OSTROWSKI: Well, he's reached, he reached that tentative conclusion and he's looking at the later versions. But I'm still working with him on it. THE COURT: Why then are you not going along with your expert, and why do you need to break down the confidentiality order so as to let Mr. James see? MR. OSTROWSKI: Well, because, first of all, the expert, he's a full time professor, he's also busy. And I'm busy in the trial, and with other matters. I just finished a one week effort to get an appeal filed in which there was very little sleep. And I just have not been able to get together with him. I just dropped him off the other day the source codes on floppy disk. But the real point is, Your Honor, he has also told me, just as Mr. Brown has indicated, that to do an exhaustive analysis of these programs is extraordinarily time-consuming. We simply, we're paying him a hundred dollars an hour. We don't know where the money's coming from for him to do anything more than basically looking at the source codes and comparing the source codes. And therefore, we essentially, without Mr. James being able to do it himself, and obviously he is, he would be able to devote -- THE COURT: Well, need he do that if Brown is not going to do his full job? Need he do more than Brown has done, namely on the five picked at random modules? MR. OSTROWSKI: Well, the plaintiffs do have one expert, Mr. Swanson, who is familiar with the programs, has looked at the programs in detail and has testified about them in detail. I happen to believe that some of his testimony is favorable to our case, but certainly much of his testimony is not favorable to our case. And I think it would be fairer to allow Mr. James, who's also familiar with the programs and therefore doesn't, unlike Mr. -- Professor Duchan, who's our expert, and Professor Brown, they don't have to start from scratch, he wrote the initial programs. So he could look at them and assist in his own case without spending $5,000 -- THE COURT: Should the Court hire its own expert and split, have the parties split the cost of that? MR. OSTROWSKI: I don't know. I'd have to think about that. But I'm also -- THE COURT: A little late in the game probably for that. MR. OSTROWSKI: I'm also making my motion, as I said, based on the testimony of Mr. Swanson that, that he had access to the prior versions of the programs that Mr. James wrote, that there are source code similarities in key aspects of the programs, and I only went through five because I didn't want to keep him on the stand for the rest of our lives. And he indicated there were source code similarities and that there were -- THE COURT: Well, if he hasn't been that warped an expert, perhaps you can bring him back. MR. OSTROWSKI: Well, then I'd have to foot his bill because he'd then be my witness. THE COURT: But his is a small bill. MR. OSTROWSKI: Well, what I'm saying, Your Honor, there is evidence of copying of -- there is evidence that Exhibits 20 and 21 were copied from the program which is indisputably Mr. James. Now then you go to the issue of ownership. I think that what has been clarified here, more so than in the prior hearing, is that all these regular checks that is really the major foundation for the claim that Mr. Graham was -- or, Mr. James was an employee, they were all written after he wrote the program. He wrote the program in April, and these checks were in August and September. THE COURT: So you would say that would take it out of the situation where the employer has a right to the employee's work, and maybe might cast it into a situation where one owning something sells it to another. MR. OSTROWSKI: Well, under the copyright law Mr. James is an independent contractor. He owns the program. He's the author. That's crystal clear. THE COURT: Well, he could release the copyright rights, I assume, along with the sale of an item. MR. OSTROWSKI: But he did not, Your Honor. In fact, in the April -- THE COURT: Well, I know. MR. OSTROWSKI: In the first April version -- THE COURT: That's what we're fighting about, that and other things. MR. OSTROWSKI: But it's all, let me also say that it's undisputed that Mr. James had a joint copyright notice on the first program that he wrote for Mr. Graham, and Mr. Graham never took any action at all to get that copyright notice off or to take any legal action. And there's certainly a doctrine of waiver under an abandonment, under copyright law. So there's -- THE COURT: That I guess I'll hear more about in the future. MR. OSTROWSKI: So there's substantial, I believe there's substantial grounds, both just, fairness to Mr. James, and he doesn't have the resources, and he is his own best expert, we -- THE COURT: Well, no, he may not be. He may be knowledgeable, but you know, he doesn't come in here untilted. MR. OSTROWSKI: But he's the best I have to work with, Your Honor, in light of the fact that we do not have $5,000 to ask Mr. -- Professor Duchane to hire a team of other professors to get this thing done real fast and on for trial. My other, the other motion I'm making, which is somewhat related, is that -- but less pressing in the course of the trial, but of course, it's nevertheless an important matter, which is that yesterday it appeared to me that the plaintiff has abandoned his position that there's any originality whatsoever in this program. And he's playing a, purely a defense game at this point, and all of the questions and much of the testimony elicited from the two witnesses was designed to show that they're really, that the programs that Mr. Graham -- Mr. James wrote, are not particularly original, they're not particularly any good. They're undergraduate material, they're novice material, as Mr. Swanson said in the past. And therefore, it seems to me that plaintiff is switching its position that it stated in its initial Complaint and request for motions, that this is somehow original, protected material that deserves to be protected by an injunction. I think there's an estoppel position here, and that if they're abandoning that position for strategic reasons in the trial, because now they, it's basically Mr. James is the plaintiff, as Mr. Kitchen has told me, that seems to be the posture of the case, and I think there was even some testimony from Mr. Brown about what Mr. Graham said to him, that he's now the defendant, then they have to say that, what is the -- they have to withdraw the basis for their injunction, and furthermore, they're now saying that there's advanced programs, Exhibits 20 and 21, which are not substantially similar to the program that Mr. Graham -- Mr. James wrote. So what is the pressing need for an injunction prior to a decision of the Court, in light of these facts. And I would ask that the injunction be lifted immediately, and I would ask that the confidentiality order be lifted. MR. KITCHEN: Well, Your Honor, first with respect to the injunction, we understood that that was pretty much being violated regularly by Mr. James, in any event, since he apparently is -- MR. OSTROWSKI: I object to references to facts not in the motion record. MR. KITCHEN: Well, I'm not sure what counsel means by the motion record. MR. OSTROWSKI: Well, what I mean is that I made an Affidavit. I know you haven't had an opportunity to respond. I certainly think you're free to point to any facts that have been testified to, but I don't think you should start to just wing it. MR. KITCHEN: I see. So apparently this Court is only permitted to consider those things which are contained within the four corners of the defendant's motion papers, and not consider anything else. MR. OSTROWSKI: And the trial. MR. KITCHEN: Well -- THE COURT: See, now he's expanding. First he contracts it. Then he expands it. MR. KITCHEN: Yes, Your Honor. THE COURT: Now you don't know where you are. MR. KITCHEN: Yes. Well, I'll kind of go back -- THE COURT: Shouldn't the next step be that you somehow make some written response to this paper, and then we argue? MR. KITCHEN: Well, I suppose it would be, Your Honor, except that this entire thing is inappropriate. I, I mean, to bring a written motion halfway through the trial, when we haven't even, when we haven't even completed our case, you know, that essentially is asserting that we're already defeated, I'd at least like to offer a little bit of argument with respect to this injunction. He says that Professor Brown testified there was nothing original about the programs. The originality that he did note, and he noted it several times, was this use of these headings for the directories which involve numbers, not just 001, but 001-A, B and C, splitting things up into several directories for the sake of speeding up the operation of the program. That seemed to be original. What was lacking, however, is authorship with Mr. James. That original item that Professor Brown noted was essentially authored by Mr. Graham, or Mr. Graham with Mr. Anderson, as the previous testimony, and indicated was the source of that prior program. Mr. James' program then does contain an important and copyrightable item. The trouble is, it isn't Mr. James who came up with it. It was, it was my client, Mr. Graham. So based on that, we have something worthwhile protecting. I would also note, Your Honor, that as far as we know, Mr. James has, has been publishing essentially a retrieval system. And if -- and he maybe has already violated the temporary injunction. But be that as it may, I mean, these people are competing in the marketplace, in spite of the fact that they're also competing in the litigation. I should point out with regard to the, the confidentiality order, I'm disturbed about the statement in paragraph 7. It says, defendant lacks the funds to hire an expert. We were given to understand, Your Honor, that defendant had already hired an expert, which is why we delivered, in fact I hand delivered -- THE COURT: Well, I think Mr. Ostrowski's statement is in support of that, namely they do have an expert, Professor somebody. MR. KITCHEN: Right. But it's -- MR. OSTROWSKI: Duchane. But the operative word in that paragraph is detailed. I don't, we don't have the funds to hire him to do a detailed analysis. MR. KITCHEN: Well, why I'm disturbed, Your Honor, is the fact that we thought that the confidentiality order was finally put into operation by reason of the fact that they had hired an expert who had then signed this confidentiality agreement. And I guess I'm a little disturbed because of -- in fact, there are not the funds to pay this expert. I'm concerned that he won't consider that he has received the quid pro quo that obligates him to abide by the terms of the confidentiality agreement, and I would hope that the professor that they have supposedly engaged but apparently been unable to pay, is going to still respect the necessity of confidentiality. To suggest that Mr. James is the best qualified to essentially look at these programs and have a detailed analysis, that's what we're afraid of, Your Honor. He's going to analyze the latest programs which were written by people subsequent to himself, Mr. Swanson, to Brian Martin, and perhaps others who've been involving in programming these newer programs which are much more advanced, have many more features, and have a real value in the marketplace. If Mr. James, who is essentially providing a retrieval program for a competing CD ROM, would have access to these things, he would be able to duplicate them. And if he could duplicate them, he could essentially hurt my client's business. THE COURT: Let me just hark back to this so-called confidentiality order, which I expressed some uncertainty about myself, and that's explained by the fact that it was handled by Magistrate Judge Maxwell. I've pulled out the original of that which was signed by him November 24, 1992, and he orders certain making available of items to the defendant. It's in the first two ordering paragraphs. And then, in the third ordering paragraph it said, it is further ordered that such disclosure shall be contingent upon delivery to plaintiff's counsel of a non-disclosure and confidentiality agreement barring either defendant's counsel or expert from disclosing the contents of said program to anyone, including defendant, without further order of this Court. That talks about some agreement to be entered into. It doesn't spring full blown from Maxwell's order. MR. KITCHEN: Well, there was an agreement, or a writing, from this Professor Duchan. How do you spell that, do you know? MR. OSTROWSKI: D-U-C-H-A-N. MR. KITCHEN: And we did receive that, and the disclosure, the discovery was turned, materials were turned over after that. THE COURT: Well, in other words, you're saying you did receive a non-disclosure and confidentiality agreement barring Mr. Ostrowski or the defendant's expert from disclosing the contents of the program to Mr. James. MR. KITCHEN: That's correct. THE COURT: You did receive that. MR. KITCHEN: Or to anybody else, right. THE COURT: Yes. Or to anybody else, but particularly where Mr. Ostrowski only wishes to have it lifted as to defendant James. MR. KITCHEN: Right. We're just, we're just afraid that, I mean, now this is just a ploy to have the fox examine the henhouse. THE COURT: Where is this confidentiality agreement? MR. OSTROWSKI: I have them. (Mr. Ostrowski hands agreements to the Court.) THE COURT: You've handed me two agreements, at least separately dated. One signed by you, Mr. Ostrowski, February 10, 1993, and the other signed by Dr. Alan, single L, middle initial I., Duchan, D-U-C-H-A-N, on February 22. MR. OSTROWSKI: Your Honor, on the bottom I believe there's a notation as to when I delivered those to Mr. Kitchen. I gave them to him by hand, I think it was in June. THE COURT: Both on the same date, namely June 7, 1993. MR. OSTROWSKI: Yes, Your Honor. My point on the motion was that I did not, I did not receive the programs immediately upon, or even reasonably thereafter. I received them on, pretty much on the eve of trial, as I recall. And therefore, the whole schedule in which I anticipated having Professor Duchan's opinion, then I could go to the Court for relief and have Mr. James participate, that has never been able to happen, in large part because of the delay of Mr. Kitchen. Although I'm not saying that I did not participate in a small way in that delay because we're both busy attorneys. MR. KITCHEN: Well, Your Honor, I -- THE COURT: Well, anyways, this, the order, the confidentiality agreements signed by you and by the professor, treat Judge Maxwell's document as an order and I guess since you're both treating it that way we can, and so it's Judge Maxwell who is saying that the disclosure would be subject to the items not being made known to or becoming available to Mr. James. I gather that follows. But -- MR. OSTROWSKI: May I respond just briefly, Your Honor? MR. KITCHEN: Well -- MR. OSTROWSKI: The issue of the originality of the table of contents is totally irrelevant because the -- we're asking the -- THE COURT: I don't know if we had completed, if Mr. Kitchen had completed his argument, Mr. Ostrowski. I'm just trying to get my -- MR. OSTROWSKI: Okay. MR. KITCHEN: Well -- THE COURT: -- own chips in line here. MR. KITCHEN: The other, the other point I was going to make, they have, he says it's undisputed testimony that programs were produced by persons who had access to Mr. James' program. That much is true. Mr. Swanson obviously had access to the program and so did Professor Brown. But I don't see how that destroys the confidentiality order with respect to the later programs which, which my client's programmers have produced. And also, he also states here that the bulk of the evidence indicates Mr. James was an independent contractor. I'm not sure we've been through all the bulk of -- THE COURT: Well, just addressing that first part. I would interpret the confidentiality order as preventing the defendant's counsel or the defendant's expert from disclosing the contents to anybody, and consequently it doesn't bar at all the plaintiff of making them available to anybody. MR. KITCHEN: Well, that's true, and to the extent that that seems at all a lack in evenhandedness, I should point out that we certainly do not -- THE COURT: Well, you need not have evenhandedness. MR. KITCHEN: Well, all right. Then moving on, the idea that the bulk of the evidence is that Mr. James is an independent contractor, first of all, the issue of whether somebody is an independent contractor or an employee, for the purpose of the copyright law, is determined by a number of factors, not simply whether or not he had deductions out of his paycheck. And I think the Reed case governs, and general agency law applies, and requires analysis of a whole number of factors, not the least of which is the method of payment. But nevertheless, just a part of it is that. And first, even Mr. Ostrowski admits that the earlier versions of the program that Mr. James worked on had an apparent joint copyright notice, and we have some, some testimony which so far has not been disputed that the prior version of the program, before Mr. James even came on board, was copyrighted by Mr. Graham and that it contained an important element, in fact perhaps the only original element, in the program at all, that being this particular use of directory headings which Professor Brown said he'd never seen before, and was apparently original. So I mean, to say that Mr. James is the undisputed or sole owner of the program seems to me, I mean, it's one of the essences of this lawsuit, but I hardly see how the evidence has gone in favor of that proposition so far. In any event, nothing would seem to be raised which would give the Court good reason to simply overturn the order of Judge Maxwell and the agreement between the parties, particularly since they've found an expert, they've selected one. I'm sorry that they have not been able to negotiate an arrangement that was perhaps as advantageous to them -- THE COURT: Well, he's negotiated an arrangement. There's just a little innuendo that perhaps Mr. James may not be able to fulfill his obligations that he's undertaken with the expert. MR. OSTROWSKI: We've fulfilled all of our obligations with the expert. THE COURT: Well, but if you're going to do more work, you've got a hundred dollars an hour. MR. OSTROWSKI: That's a complete red herring by Mr. Kitchen. MR. KITCHEN: Well -- THE COURT: Well, I thought you raised it. MR. OSTROWSKI: No. No. Mr. -- I raised the issue that we don't have the money, we don't have $5,000. THE COURT: Have the money to do the work. You have an expert who can do the work but he's going to charge money that Mr. James doesn't have. MR. OSTROWSKI: No. Well, additionally, Your Honor, he doesn't have the time. THE COURT: Who doesn't have the time? MR. OSTROWSKI: I mean, he's a full time professor. MR. KITCHEN: Well, let me, let me raise -- MR. OSTROWSKI: But we have, we have paid him. We don't owe him any money. THE COURT: Well, then, then you ought to find an expert who does have time. If he doesn't have time, he's not available as an expert, is he? MR. OSTROWSKI: Time and money are the same thing, Your Honor. I mean -- THE COURT: No. They are and they aren't. MR. OSTROWSKI: If I had $5,000 -- THE COURT: If somebody is fully occupied 18 hours a day, seven days a week, regardless of money, he's not available. MR. OSTROWSKI: If we had $5,000 you could put a team together. Are you finished? Can I respond? You've been talking for about 10 minutes. You've made about 17 different points. I'm going to have to take notes. THE COURT: Well, have you finished, Mr. Kitchen? MR. KITCHEN: Well, not quite, because let me -- MR. OSTROWSKI: He's filibustering. MR. KITCHEN: Let me just say that if another expert could be found by defendant whose terms of employment were more favorable, certainly we would consider entering into an agreement which would involve that person's confidentiality. THE COURT: Well, you don't have to. All that new expert has to do is to sign another piece of paper, as Professor Duchan has, and you're off and running. MR. KITCHEN: Well, perhaps, perhaps the experience in the courtroom thus far has persuaded defendant that their hiring of an expert was not exactly the best deal available. And maybe they would like an opportunity to find another expert. As long as the expert is sufficiently independent, signs an appropriate agreement, I don't see a problem with it, as I'm sure the Court doesn't. THE COURT: Well, you have nothing to say about their expert, except to object as to his qualifications and impartiality, and so forth. MR. KITCHEN: But, when it comes to the root idea of confidentiality, we -- it must be preserved for the sake of my client's economic survival. THE COURT: Sure. But if he got five new experts, each one would have to sign a similar document. MR. KITCHEN: Absolutely, Your Honor. THE COURT: Right. MR. OSTROWSKI: The notion that we haven't fulfilled our obligations, that the expert is not going to comply with the order of the Court, is a bunch of malarkey. It's a total red herring. We've paid him money to do what he has done. We do not have the funds to pay him to do an exhaustive analysis, which -- and time and money are linked. If I had $5,000 grand, I have no doubt in my mind that he could assemble a team of experts and get it done in four or five days, because he would then be able to pay associates. Let me make two very brief points. Mr. Kitchen has made an astonishing stipulation, admission on the record, that the only element of originality in Mr. Graham's first programs or in the subsequent programs that Mr. James worked on was the arrangement of the table of contents. Well, that's wonderful, because -- just take Plaintiff's 21 as the example, although I'm also referring to 20. The confidentiality order forbids me from showing Plaintiff's 21 to Mr. James, yet there's nothing - - THE COURT: Even though it's in evidence. MR. OSTROWSKI: Yes. And there's nothing, the table of contents element, which I have trouble articulating because frankly I find it difficult to understand what's so original about arranging categories, so whatever that is, that is the only original element, as Mr. Kitchen just stipulated, is not in here. So it's very simple. He has stipulated that there's nothing that Mr. James can appropriate in Plaintiff's 21 because there's nothing original in Plaintiff's 21, there being no table of contents arrangement, and Mr. Brown admitted this, that the table of contents and all that screen, what's on the screen is not part of the file retrieval program. So I would ask that in light of Mr. Kitchen's stipulation, that the injunction be lifted immediately, and also, more importantly, that the confidentiality order be lifted with respect, very briefly, to the independent contractor status. If we all rushed into Court on a Saturday, that Your Honor graciously agreed to hold a hearing on a Saturday, and I don't think any of us fully understood what the relationship was between the parties. Now, but if you take the evidence then on independent contractor and compare it to what has developed in the trial, if you take all the strongest points in favor of Mr. Graham, his participation, his payment of money, where the work was done, I think you will note, Your Honor, that in all these issues, Mr. Graham has fallen back, that it's all done in the taxi now, he doesn't know anything about computers. I think we've, I went over that so many times that it got boring and I stopped. He doesn't know anything about computers. He didn't write the Anderson program. Anderson wrote it. He didn't add anything original to it. There's no comparison at all in the skill between the parties. He wasn't -- the one thing, the one thing that stands out as evidence that Mr. Graham may -- Mr. James may have been an employee, was these regular paychecks. And now it's undisputed and clear in a way that it perhaps was not clear originally in the rush of a Saturday, that these regular checks didn't start until after he wrote the program. He wrote the program in April '91 in Quick Basic. The checks didn't start till many, many months later. So all I'm saying is that it's now crystal clear that Mr. James was an independent contractor and owns the programs. MR. KITCHEN: Your Honor, respectfully, Mr. Ostrowski is confusing the issues here. The, the concept of originality is a necessary prerequisite to some copyright ability. But the idea that somebody could just -- and remember, the essence of our case is that, first of all, Mr. James was not the owner of the program, in spite of the fact that he had worked on it, that Mr. Graham as his employer was the owner of the program. But secondly, that his infringement or misappropriation was essentially just simply changing the names or the labels on the program and marketing it under his own name. Now, clearly that is infringement, without a -- because it was essentially the same program. I mean, it was essentially a duplicate of that, of that program. What is somewhat different about the infringement claim raised by defendant on the counterclaim is that he's claiming that all subsequent programs, which are admittedly revised, new, added to, done by different programmers, that sort of thing, is that there's some sort of similarity, and it requires supposedly this analysis of similarity. It's in that respect that we look for particular original things, or we differentiate similarities which are the product of necessity of the function, limitations of computer languages, computer programming languages, as opposed to similarity which has arisen out of one person copying or taking somebody else's creative work. Apparently that analysis is required, which is what we spent a lot of time on. But I don't think such an analysis is required in terms of plaintiff's case, where admittedly, Mr. James simply appropriated the program that he had been involved in writing for Mr. Graham. He felt that he was doing it under some claim of right, some kind of claim of ownership. But nevertheless, there isn't really any dispute about the fact that he was trying to market that program. So I think in that respect we have a somewhat different case, when it goes in one direction versus the other. And I don't think, you know, confusing them and saying, aha, we, this was supposedly original so therefore it's -- you know, I mean, you can't mix the two as easily as Mr. Ostrowski would like to. THE COURT: Well, I see no reason or basis at this juncture to vary the confidentiality order. I suggest that we go forward with your expert, to the extent that you want to take him. If after that there seems to be some area where you cannot retain and have the services of an expert, perhaps then we might work some softening of the agreement. And I emphasize the word perhaps, but I see no reason to do it right now. As I see no reason to vacate at this moment the temporary injunction. All of that without prejudice to developments as they develop. MR. OSTROWSKI: I believe Mr. Graham is ready for cross examination, Your Honor. THE COURT: I believe he is. We had interrupted his cross examination on September 8th. I don't see anything indicating that Mr. Ostrowski had ended his cross examination. He said, as we went into that particular cessation of his testimony, that he had received 30 to 40 pages of financial statements from Mr. Graham, he wants to delay cross examination concerning the same. Also, I can't interpret my own thing. I have F/S, also some F/S re other aspect needed. Kitchen wants Ostrowski to finish with Graham. So we interrupted Mr. Graham. MR. OSTROWSKI: Your Honor, my cross will primarily deal with the records that I received but I'd like some leeway in getting into a couple other areas, one which is a tape recording which, it's quite a lengthy tape recording and I have a few questions on that, and -- MR. KITCHEN: By the way, Your Honor, it was my intention on redirect to play both of those recordings completely. So I wouldn't object to that being done in the course of cross. MR. OSTROWSKI: Whatever is convenient. It doesn't matter. THE COURT: What does it matter? What does it matter when it happens? MR. OSTROWSKI: Well, I'm not going to play the tapes. They're quite long and boring, and I'm not going to play -- I'm going to ask questions based on them and I may -- THE COURT: Well, I think if they're going to be played, they ought to be played first, and then you can ask about them. Mr. Kitchen says he wants to play them. MR. OSTROWSKI: Okay. That, I have no objection to that, as long as he gets charged with the extra time it takes, because I wasn't going to play the tapes. There are gaps, and so on, and -- but I have no objection to that, if we want to start out with that, and -- but I -- there's been some -- what I'm saying, Your Honor, is, I don't intend to get into a lot of new areas, but there's been some leeway on both sides, given the interruptions of the trial and counsel continues to work and wants to ask further questions, I haven't objected to Mr. Kitchen in that regard, and I'd ask that I be given similar deference. THE COURT: Well, my pattern is that I have allowed, I do allow the fair range of subject matters scoped on the first round of cross examination and thereafter I tend to limit it. I know the rules of procedure and rules of evidence would say that you should limit it in the first instance, but then that doesn't lend itself too much to judicial efficiency. You have the same witness coming back on behalf of different parties. In any event, let's go forward. If someone sees an objection -- MR. OSTROWSKI: I do have one, a technical problem, Your Honor. I left my extension cord in the office. I didn't anticipate that -- I have batteries. They, I don't know if they'll last through the whole recording. THE COURT: You have what? MR. OSTROWSKI: I -- my tape recorder works on batteries. I left the extension cord in the office. If I am going to -- THE COURT: Is this to play the thing? MR. OSTROWSKI: Yes. If I play the whole tape, I'm not sure what's going to happen. THE COURT: What sort of -- does it run off an adapter? MR. OSTROWSKI: Yes. THE COURT: What particular voltage? MR. OSTROWSKI: Does not say. It says AC in. That's all it says. THE COURT: Oh, it takes the AC in. You just want to, does it have, what kind of a plug? MR. OSTROWSKI: 120 volt, 120 volt, 6 watt. I've got batteries. I'm just, I'm not sure how long they'll last. THE COURT: Let me see. MR. KITCHEN: My client indicates that he'd be happy to buy some batteries for it, if that would be necessary. MR. OSTROWSKI: Well, with all his money. (RICHARD E. GRAHAM, Plaintiff, Previously Sworn.) THE COURT: You're under oath, Mr. Graham. THE WITNESS: Yes, sir. MR. OSTROWSKI: I don't have a lot of questions, Your Honor. I think it might be more efficient if I did it that way. THE COURT: But we've already established that Mr. Kitchen wants to play the whole thing, and I thought that that should be done, and then you would examine Mr. Graham about aspects of it. MR. OSTROWSKI: I have no -- I'll do it that way. I have no objection. THE COURT: All right. Now the problem is, you've got to put it right up against a microphone. The microphone then will play into the P.A. system. So you can put it, I suppose on the -- I don't know if that one, does that one on the rostrum bend down? Certain ones don't go into the P.A. system. Yeah. Put it right there. It plays right into that. Everybody can hear it. Put it right where Mr. Kitchen has arranged. That's all right, isn't it? CONTINUED CROSS EXAMINATION BY MR. OSTROWSKI: Q. I'm showing the witness Plaintiff's Exhibit 16. Can you identify that? A. To my recollection, yes. Q. Is that a tape recording between you and Mr. James that you tape recorded -- a phone call, I'm saying. I'm sorry. A. Without hearing it, I couldn't actually tell. Q. Okay. Let me just play a couple -- THE COURT: Well, does it have any identification on the cassette that -- MR. OSTROWSKI: It says Larry 1. THE COURT: Whose writing? I mean, you don't recognize it, Mr. Graham, is that right? THE WITNESS: No, sir. BY MR. OSTROWSKI: Q. Is that Larry 1 in your writing? A. No, sir, it's not. Q. Let me just play a couple of -- THE COURT: It's in evidence, and I don't know how it came -- MR. KITCHEN: Your Honor, I think they've already been identified. They've already been put into evidence. THE COURT: They're both in evidence, 16 and 17 are in evidence, Larry 1 and Larry 2. MR. OSTROWSKI: I did want to ask one or -- just a couple preliminary questions about how he recorded it. THE COURT: Go ahead. THE WITNESS: I didn't record it. THE COURT: Well, wait a minute. You were going to ask some preliminary questions. MR. OSTROWSKI: Okay. Well, okay, I guess we don't have to identify it. I'm sorry. I'm in the habit of identifying everything before I do it. BY MR. OSTROWSKI: Q. You said you didn't record this conversation. Who did? A. Greg Armenia. Q. And how did he do that exactly? A. He did it with a little box that he had in his hand. And he put something on the phone. Q. Okay. Did he plug, did he plug a wire into the phone outlet, or did he stick a recorder, did he stick a microphone onto the phone? A. I couldn't tell you. I can't remember. I know he had something on the -- THE COURT: Suction cup on the phone? BY MR. OSTROWSKI: Q. Are you familiar with the things you can buy at Radio Shack where you actually, it looks like a phone plug and you plug it right in? A. No. He'd have to tell you that. I'm not sure how he did it. Q. Okay. Well, I'll just play the tape now, at this point, without interruption, as long as the battery -- (Exhibit 16, tape recorded telephone conversation between Mr. Graham and Mr. James played in courtroom.) Transcription of tape recorded telephone conversation: MR. GRAHAM: Hello. MR. JAMES: Rich. You in bed already? MR. GRAHAM: Yeah. How's it again? MR. JAMES: I had to step out. You know, I wanted to call you back, see what you wanted. You know, everything's been hectic over here. I got my kid move -- he was on the phone when you called before, my son, Donny. Then when you called I was right in the middle of something I had to go -- MR. OSTROWSKI: Just pressing Pause. Is that too loud? THE COURT: No. You might ask Mr. James to speak up though. Continuation of tape: MR. GRAHAM: Well, you hit the hay early. MR. JAMES: Yeah. Well, I've been working hard and I'm kind of tired. So I'll get up some time in the morning. I'll give you a call in the morning time, around noon, and -- MR. GRAHAM: Hey, I got a question. MR. JAMES: Yeah. MR. GRAHAM: I tried to, you know the C that we were working on the last day you were here? MR. JAMES: Yeah. MR. GRAHAM: The C code. How come I can't compile that? I tried to compile the code that you were working with. MR. JAMES: Uh-huh. MR. GRAHAM: And I can't compile it. You know, it won't compile into an execute file. MR. JAMES: I don't see why it shouldn't, but what's wrong with the code you have? MR. GRAHAM: Well, no. I wanted to see the change that you made in that one there compared to the other codes, you know, and see which one's the best one to use. So what I did is, you know, well, that was the first I started the computer on, by running the source directory, right, like you showed me, typed BC and brought it up, compiled the whole thing. It said all, so I took the all in there, because like I said, I don't know that much about it, did the all, you know, to make -- or, I guess in compile it says, if you want to compile and execute, you want to compile this, I said all. And it compiles but it only comes up to about 86K and it won't execute. MR. JAMES: I had been using the basic -- I had been using Q edit and it's on defaults and things, I would really have to set it up because I haven't been using, I haven't been using that environment for a while. In fact, I don't use it now. MR. GRAHAM: Yeah, but I mean how, but how can I -- because that shouldn't have anything to do with the source, should it? I mean, I should be able to compile the source. MR. JAMES: I don't know what the situation is. I have to look at it. MR. GRAHAM: Oh. You know, if I don't go with what you're working on, I want to go with this here, you know what I'm saying.And if I can't compile it, it ain't no good with me. MR. JAMES: What changes you want to edit? MR. GRAHAM: Huh? MR. JAMES: What changes you want to edit? MR. GRAHAM: On what? MR. JAMES: In the code. I mean, what, is there some problems or something? MR. GRAHAM: No, just the copyright part. The copyright by Larry James, because it's not copyrighted by Larry James. It's copyrighted by the Night Owl. That's the only thing I want changed. MR. JAMES: I guess if you wanted to, you can take a chance and try to change that. I already told you, you know, like if I was you, I really wouldn't take a chance in putting that, a change on the permanent CD ROM drive, because I'm telling you, Richard, it will appear to work, and it might work, it might work forever, but it probably won't. I had told you when I was doing that, I said, if somebody, you know, changed that, you know, like, on purpose, I took a lot of time to make it seem like it will work but it doesn't. MR. GRAHAM: Yeah, but you even surprised me because I thought you did, you know, you did take the Compuserve number off. That was great. But I mean, you still left the copyright by Larry James, you know. That's what's really throwing the whole ball of wax off. You know, all I've been trying to do all night long is compile the source that you last worked on. And it won't compile. I don't have no actual working source code and that's what I can't figure out, why I don't have the actual working source code, you know, the Night C. Matter of fact, I take all the codes, the last five working days of code. None of them will compile. The thing used to compile. What, did I lose you? MR. JAMES: No. I'm -- MR. GRAHAM: Oh, I thought for a minute that you hung up or something. MR. JAMES: I was half asleep. MR. GRAHAM: Am I missing something out of this package? MR. JAMES: I haven't been using that environment to compile lately. So I really would have to check it out. I have been doing it very expedient, and I don't know, you know, what changes you're doing or what you're trying to do. I would have to look at it and work on it. MR. GRAHAM: I'm just trying to compile the Night C. You know, the Night C program, that's all I'm trying to compile. Donny, if you hear that FAX machine click, don't answer the phone. If that rings, don't answer that. That's a FAX machine. All right. You're not really writing in C now, are you? You said you weren't using this environment. What are you, how the heck are you writing then? You've got me totally lost. You mean, we've switched to a different environment? We're not using C Plus Plus anymore? MR. JAMES: I use Q, the environment in Q edit. MR. GRAHAM: Oh, but then how do you compile it? With the compiler, with C Plus Plus? MR. JAMES: I guess it's kind of a long story. I would have to do it. I really don't know what problems you're having. I don't know what changes you're going to make and what you're doing. MR. GRAHAM: You mean you couldn't tell me how to do it? You know, because I got to have codes for tomorrow if I plan on sending this thing in. I want to, you know, I'm losing money bad here because I haven't got nothing to really send. MR. JAMES: You know, I had worked on the program, I had worked on it, I didn't get to the flea market today until 1:00 o'clock, and while I was there I was still working on the program. When I got back, I was still working on it, and as soon as I got everything done, I gave you a call. MR. GRAHAM: Yeah, I know. That was earlier, but I'm still, I'm totally lost because, okay, what I'm trying to find out is, okay, you mean to say if I take, if I take the C that you got right now that -- okay. Why don't I have -- no, I haven't got a copy of the Night C, right, so I can't compile it. Even the code that you've got now, I can't compile it. I probably couldn't compile that, even if you brought that over tomorrow. I even backed up and put the old system back on that I used to compile with. That don't even work. This file is missing. There's something missing that was in that package that made, made it compile before. Now it don't compile no more. You know what I'm saying? Otherwise it won't make an executable file for the Night no more, and I used to do this, you know, I used to play around with it, too, you know, and play around with little things in there to see if I could try to find out how to search drives and stuff like that, and compile it. I'd have an error, of course. Then I'd go back and take that line out, recompile it and then be able to fire up Night. Now I can't make an actual compiled file fire up the Night. MR. JAMES: I don't know what changes you made. MR. GRAHAM: I didn't make any changes. There was no changes made when you locked this machine up Tuesday, when you had the hard drive crash or whatever happened. I fired it up today, this is the first this machine's been fired up to play with the C, with the C Plus Plus, and it does not compile anything. It says it's compiling. It comes up with no errors. It comes up with those 10 warnings, but it don't come up with no errors. And it compiles it, but you cannot fire up the Night. It comes abnormal termination or abnormal something. It doesn't even fire the Night up, don't even fire up the evaluation copy or whatever comes up first, the configuration, nothing. I haven't changed anything. I haven't changed the environments or nothing. And then I says, well, maybe something happened. So I backed up the whole system, restored the whole system from the tape back-up I had. MR. JAMES: Well, I did have some libraries and routines that was loaded and I kept them on floppies. I don't know, like -- MR. GRAHAM: Do I want them -- yeah, I can understand you having routines on floppies but why aren't they here? I mean, if the routines, I mean, you know, that's what the routines are for. Right? That's what it's missing then. That's why I end up with the small execute files because them routines are missing. It's not compiling them, right? MR. JAMES: That's the only thing I can figure. MR. GRAHAM: Yeah. Well, how come I don't have them? You want to go on the board, Donny, just hit C. MR. JAMES: Donny start to use the board? MR. GRAHAM: Yeah. He moved back in so I'm giving him a chance to learn a little something. MR. JAMES: Thats okay. MR. GRAHAM: But shouldn't I have them routines? MR. JAMES: As far as I can know, they may be there and may not be there. I'm not sure. I really don't know what the problem there is. I gave you a working copy, you know, so I don't know what the problem is. MR. GRAHAM: What routines will I look for, do you know? MR. JAMES: Verify. MR. GRAHAM: Verify? Verify. MR. JAMES: Listen, as soon as I get a chance, let me wake up. I'll give you a call tomorrow night and I'll bring you a working copy. I worked for at least 48 hours on what I have. You're missing about 13 drives and everything else and I have it and it's ready. MR. GRAHAM: Yeah, but you said tomorrow night? MR. JAMES: Richard, I was on my way over when I called you the last time. MR. GRAHAM: Oh, I didn't know that. MR. JAMES: I had told you I was on my way over. You said you were stepping out for 20 minutes. MR. GRAHAM: Yeah, well, it got a little longer than I wanted, but what I want to find out is, now that I've got this thing here, I want to be able to compile it, the code. You know, my complete source code that you worked on. You know, if we can't reach an agreement, Larry, you aren't going to continue to use that C Plus Plus, are you, the one that you uploaded to the board? MR. JAMES: (No Response) MR. GRAHAM: Are you? MR. JAMES: Richard, I really don't know what you're talking about. It really is kind of late. I called you at a very decent hour. And I told you that I would get in touch with you tomorrow, and I would have a working code for you. MR. GRAHAM: Yeah, but you don't -- MR. JAMES: As far as I can see, as far as I can see, you know, I don't see no, no more work cooperation than that. I don't know what you're talking about. You know, it seems like you may be tired and you may require some rest or something. MR. GRAHAM: No, I don't. It's just that I have a disk to put out and you've crippled me. I have a disk to put out and I have no, I have nothing to work with. You've tied, you've tied my legs to where I have nothing, to where I can't reproduce my disk. MR. JAMES: Richard, who tied whose legs? MR. GRAHAM: How did I tie your legs? I paid you to work for me, did I or did I not? I paid you to write the source codes for that. And now you crippled it to where I can't have the source codes. That's why you were writing at home, I guess. That's why you were writing at home. That's why you really wanted to go on a commission basis instead of pay basis so you could write at home and I would never see the C code. The source does belong to me, that's why I can't figure out why I can't use the source. That's what I'm wondering. MR. JAMES: Richard, if you don't use the executional program that I give you, you know, like you take, you take a real big serious chance on trying to publish something that's modified. You take, if you put the code that I gave you as a working code and work, there's no problem with it. I'll vouch for it and I'll stand behind it and support it. But if you put something different, you take a real big chance. You take a real big chance if you try to modify that. MR. GRAHAM: Okay. Understandable. I understand that. But I had the source codes that you left on the drive here the last time you worked on it, and I can't compile them. That's all I wanted to do is compile what you had here so far. The screen has not changed or anything, everything identical. That Night C will not compile. MR. JAMES: (No Response) MR. GRAHAM: See because every day that I don't get a disk out there, that's costing money. This was supposed to have been out Monday. That's why we talked Sunday. We talked Sunday and I thought it was being taken out. Then Monday we talked again, I thought it was being taken out. But it still wasn't what we really needed to sell the disk. MR. JAMES: (No Response) MR. GRAHAM: I mean, I know, I know I asked you to lock the codes up. I understand that. But why can't I compile? That's not locking the codes, is it? MR. JAMES: The directory search routines are working. Do you want the code or not? MR. GRAHAM: Okay. In your help screen, do you have, copyrighted by Larry James? That's the only question I got. Who is it copyrighted by? That's what's irk, that's what's, you know, what's bothering me. Who's this thing copyrighted by? MR. JAMES: There were a few other problems in the program. The code that I have now -- MR. GRAHAM: Uh-huh. MR. JAMES: -- it's the most complete that you ever see. MR. GRAHAM: Right. MR. JAMES: Like, the, all the other programs have Compuserve and I have left them all out. That's why I told you to let me know before you -- MR. GRAHAM: Okay. Okay. What's it going to cost me to get them codes? MR. JAMES: You were already told about the commission, Richard. MR. GRAHAM: But you really don't think otherwise, and them aren't my codes that, up until the day before yesterday, that you worked on then. Otherwise, okay, when -- if I took you on a commission basis, do I get the source codes? MR. JAMES: Richard, right now you're paying on a commission basis. MR. GRAHAM: Right. If I've taken -- MR. JAMES: We were sitting on the porch and you promised me a dollar a disk. You said, Larry, if I get $3.00, one of the dollars will be yours. MR. GRAHAM: That's right. When I, when the retrieval was sold, right, not on my disk. MR. JAMES: And when you went in the house, you said, because you asked me, you said, Larry, what would I have to do, you know, for me to give you this originality that you wanted. MR. GRAHAM: Right. MR. JAMES: And so we went in the house and you asked me, did you ever draw up a contract, and I told you, a gentleman's agreement was enough for me. And I lived up to that. Richard, you know, I have to live. I have to pay rent. I have to pay my light bill. I have to pay my gas bills. I have to pay my telephone. MR. GRAHAM: I understand that. MR. JAMES: That car, I have to pay $125 a week just for that car. I'm behind on everything. MR. GRAHAM: I understand that. MR. JAMES: So I don't know what you expect of me, you know, but everything I've said and everything I did, I've been straightforward. Now, I brought you a working copy yesterday. I don't know what, you know, - - what you was doing when you expressed you were pleased with it. I not only gave you something that was doing very well, but I came back, and I have spent at least 12 hours straight -- MR. GRAHAM: But that's not what I asked you. Do I get the source codes with it? MR. JAMES: (No Response) MR. GRAHAM: You do agree -- wait a minute. Maybe, maybe, maybe we're getting on the wrong track here. Are these my codes or your codes? MR. JAMES: (No Response) MR. GRAHAM: That's what I'm trying to find out. MR. JAMES: What you use, Richard, is for your use. The same way you have -- Richard, from day one, you told me that, Larry, you're a programmer, which I always knew. You said, I was programming for Vince's company, and you said, Larry, because I told you that they was paying me $25 an hour. MR. GRAHAM: Uh-huh. MR. JAMES: And you said, Larry, $25 an hour, you should really get paid. Let me be your manager and I'll make sure you get paid for your work. MR. GRAHAM: And you did, right? MR. JAMES: Richard, the thing that you did, you haven't lived up to the things that you said. MR. GRAHAM: I don't see how you say that. MR. JAMES: I, for the past month, I haven't gotten no more this month than I got last month when I was driving cab. MR. GRAHAM: Wait a minute. But I don't see how you can say a statement like that, Larry. You did get paid for writing for the Night Owl Computer Service. You did get paid. Did you or did you not? MR. JAMES: Richard, you -- yes, I got paid, and it was enough that I didn't have to go and drive a cab. MR. GRAHAM: And, but I also told - - (Space on tape) faster and better, and once these disks weren't selling at a discounted rate that I would give you more money. I mentioned that. I know I mentioned I'd give you more money, and I mentioned I'd give you a commission on the disk, but not on the Night Owl's disk. I told you distinctly that when the retrieval was sold that you would get a commission, a dollar commission, yes, I did. I admit that. But that was -- MR. JAMES: You know, it's really something. You know, all these times when you caught amnesia and don't remember the things that you said, you know, the things you said on the porch, and you said them in front of Demetrious, you said them in front of Wayne. And you know, Demetrious could overhear me talking because all the time like with the problem of me not working and not getting a commission, to me you'd never believe, you know, it was almost like I made that up. I mean, you'd never believe that you would just change like that. And he still has never heard you say, you know, that you didn't promise me a dollar a disk for the Night Owl. MR. GRAHAM: No. Sorry. You better retract that because you're lying. MR. JAMES: I'm not lying. MR. GRAHAM: You are lying, Larry. I never promised you any money from the Night Owl Computer Service. Never. MR. JAMES: What did you say, Richard? MR. GRAHAM: I didn't tell you you were getting a commission off the Night Owl's disk. MR. JAMES: Richard, you told me, Larry, it wouldn't bother me if I sold them for $3.00 and sold a million disks -- MR. GRAHAM: But I, wait a minute, Larry. I wouldn't make a statement like that, Larry. I wouldn't have made a statement like that because I paid $3.75 for the disk. Now, how could I make a statement like that, if I made $3.00 a disk I'm going to give you a dollar. Now, why would I make a statement like that? I've been in this for over nine months now. I know what I pay for my disks. Now, I'm going to make a statement, anything over $3.00 I'm going to give you a dollar a disk. I know what I said. I may play I have a lapse of memories at times, but I remember the statements I make. Yes, I told you I was going to give you a commission. I most certainly did. But not on the Night Owl's disk, and I specifically told you that three times. And I sat down here, right where my wife is standing now, pouring a cup of coffee, I told you, Larry, the reason why I can't pay you a commission on a Night Owl disk is because we sell them at discounted rates. I says, if you wanted to go on a full commission, I says fine. I sold three disks this month. You would have made $3.00. I says, that's not fair to Larry James. That's why we agreed on a certain salary. MR. JAMES: Well, that's why right now the arrangement is not on the so-called disks that you sell. It's on the disks that you cut. MR. GRAHAM: Uh-huh. But do I own the source codes? That's what I'm trying to find out. MR. JAMES: Richard. MR. GRAHAM: Yeah. MR. JAMES: If I, if I just signed everything over to you -- MR. GRAHAM: Wait a minute. How are you signing everything over to me? I own the source codes. I paid you for them. You worked for pay. I own the source codes. There's no doubt about that. We know that. That was the squabble between copyright by Larry James. MR. JAMES: Richard. MR. GRAHAM: Yes, sir. MR. JAMES: If a person writes a letter, writes a form, writes a book, there is a legal binder, you know, for them to set a legal notice. This is something we went over. You mentioned it, and I did, you know, talk to some, some legal advisors. MR. GRAHAM: Then you're getting off on the wrong story, because somebody writing a book, if they're writing the book for pay, it happens to be the person that paid for the product, because Larry James' check says right on the bottom, paid to Larry James, notation, for programming the Night. Signed by Larry James. All these checks are signed by Larry James, and it says, for programming the Night. So how can it be Larry James' program if I was paying you to write the program? MR. JAMES: Richard. MR. GRAHAM: Yes. MR. JAMES: You -- I would be glad to support the program and the disks that I gave you, you would have a full working version of the retrieval to do just as you please. MR. GRAHAM: But I won't have my source codes, is that what you're telling me? MR. JAMES: Richard, when I, when I see the money that you're promising me, when it starts to materialize, you know, like I would have some confidence. You know, right now, Richard, I don't have much of a leg to stand on. You know what my financial situation is. You know I didn't have any money, except I was dependent on those cabs, and when I let that go, when I stopped driving cabs, the money that I was getting was the money I was getting from you. MR. GRAHAM: That's right. MR. JAMES: So when you, when you talked to me and made the decision to say the things that you said, you know, that, when you terminated me, you know, like that was a serious thing, you know. MR. GRAHAM: Well, who wouldn't, Larry, because I asked you to do one simple thing to my codes. You walked out. I didn't fire you. You walked out. I asked you to do two things to the codes, to take that one out and put a search program in. Put the search in for the CD ROM. You're the one that left. You said you wouldn't do it. And I asked you why. And you said, that's your signature. Well, everybody that I talked to says that's not a signature. That's claiming a product. You're the one that left. Okay. I just compiled the program. I restored the system and I compiled the old Night C. And I have no problem compiling the old Night C. So that tells me that you deleted a lot of stuff off the drive before you left here Tuesday, when you had that 2:00 o'clock appointment, when we started getting into this, when I really started pressing you about, when are you going to work on that code I asked you about. MR. JAMES: Richard, I didn't delete anything off your hard drive. I did not delete nothing off the hard drive. Maybe I didn't put everything from my floppy, all my work, and maybe you didn't notice that a lot of times there was a floppy in the disk while I was working. MR. GRAHAM: Right, I didn't but -- MR. JAMES: But I did not delete anything. MR. GRAHAM: Yeah, but why was -- why wasn't that program put on the C drive, in the C -- into the C, where it belonged? That's what I can't understand, why wasn't it put over in our library if it was part of the program. MR. JAMES: Everybody uses libraries to speed up their routines and their codes. MR. GRAHAM: Yeah, but that's a library that belongs in the Night, right? It belongs in the Night. I know it -- I know what you're talking about. It's the include files, right, that you include in there for, for the program to search certain ways and do certain things. MR. JAMES: (No Response) MR. GRAHAM: I'd like to have a copy of the C codes. MR. JAMES: (No Response) MR. GRAHAM: So as to what you're saying, okay, but that still doesn't answer my question. You told me if I live up to my agreement, what agreement? What have I got to give you in order to get my codes? MR. JAMES: Richard, what I, I really strongly suggest, and I would hope you consider it, you know, let's work on a commission basis, and I will support the program, I will support the program and make the modifications and fix up the disk just the way you want it. And I'll even go overboard and whatever you ask for, it will be that and plus more. You have, you have seen the program progress, you know, at such a rate. A month from now, what you're looking at now will be about as different as MS-DOS 2.0 and MS-DOS 5.0. MR. GRAHAM: Right. But is that telling me that you're keeping the source though, right? You're keeping the source from me? Otherwise you will work it and you'll give me the execute file. MR. JAMES: And it will do everything you want it to do. MR. GRAHAM: But I don't get the source, right? MR. JAMES: I'm not absolutely saying that, but down the line as we work together, you know, like I'm real sure if you be able to deal with me as I am with you, you know, and the money come in, there won't be any problem. MR. GRAHAM: (No Response) MR. JAMES: You want to look at this program that I've been working on or not? MR. GRAHAM: Okay. I'll tell you what? Can you upload the C so I can compile it tonight, so I can get it ready for morning, because it, okay, this compiler, I just compiled. I want to come up at the end with the red screen. Remember the old red screen we used to have, and you put the new one in. So the compiler is working now. All I want to be able to do is compile the Night C that you have so that we can go ahead and put this on that disk, on the 4-1. MR. JAMES: (No Response) MR. GRAHAM: I hear you pecking away at the keyboard. MR. JAMES: Oh, that's not me. Demetrious just got out of the bed. As soon as I get off the phone, I'll have to debate with him about the files because I don't know if I can do it tomorrow. MR. GRAHAM: School time. Well, what do you say? Can you upload the C so I can compile the sucker and get it on that disk? MR. JAMES: Richard, it's already totally ready. MR. GRAHAM: Oh, you mean the execute? MR. JAMES: Yeah. It has the search in it. It has everything in it. There was problems in the other one. One of the problems is, if you have environment set wrong, like you have the environment set for a K drive, you don't have a K drive. MR. GRAHAM: Oh, all right. But that would be the execute. Well, no, wait a minute. You can't compile it because you don't have a C. You don't have the C Plus Plus. Oh, yes. Okay. You do. Right. I forgot. MR. JAMES: You forgot what? MR. GRAHAM: I forgot you had the C. MR. JAMES: You also forgot that I was programming in C before I even, before you even bought me that C package. MR. GRAHAM: Oh, okay. Upload me the execute file then. That will work. Let me take a look at that, see what we got. MR. JAMES: All right. MR. GRAHAM: Okay. (End of tape recording of telephone conversation.) CONTINUED CROSS EXAMINATION BY MR. OSTROWSKI: Q. I think it is. A. To my recollection I think it was. Q. Do you remember the date of that conversation? A. Not to the date, no, I'm not sure. Q. No? A. I'm, I'd say possibly November. Q. Of what year? A. '91. Q. And do you know what, what time it was? THE COURT: What time of day? THE WITNESS: I know it was in the evening. I'd say 11:00, 11:30. BY MR. OSTROWSKI: Q. How many CD ROM's did you sell in November of '91? A. How many CD ROM's? I'd have to look at my records. Q. Roughly? A. In November? I'd say a hundred. Q. Was there any -- did the tape recording -- THE COURT: Excuse me. What was that answer? THE WITNESS: A hundred, 100 disks. BY MR. OSTROWSKI: Q. Where was the tape recording machine when you were on the phone? A. I don't, well, let's see, our phone is on the wall. It would be in that corner. Greg was over on this side of our counter. We have a full counter like -- Q. Was it in the room with you? A. Yes. Q. Okay. A. As far as I recollect. Q. During the phone call, did the tape recording machine ever stop? A. I couldn't tell you that. I wasn't paying attention to the recording. Q. What happened -- THE COURT: Excuse me. Your answer is what? THE WITNESS: I wasn't paying attention to the recording. THE COURT: You don't know if it stopped? THE WITNESS: No, I don't know. BY MR. OSTROWSKI: Q. What was the purpose of the call? A. The purpose of the call was what was going on with my code. Q. What was the purpose of taping the call? A. To find out what was going on with my code. We had been arguing about the C Plus Plus, and with him locking it up and with these -- Q. Well, how would, how would a tape recording help you find out what's going on with your code? A. It would help me find out a lot, if it's mine or not. Q. The tape recording? A. That's right. THE COURT: Well, you would find that out just by listening to what Mr. James said, would you not? THE WITNESS: Not really. THE COURT: You mean you weren't -- weren't you listening? THE WITNESS: I was listening but he's always coming up with different answers. THE COURT: But you would hear whatever he said. THE WITNESS: Yes, sir, I would. THE COURT: So you would learn whatever he had said just by listening to it. THE WITNESS: Yes, sir. THE COURT: The question is, why did you record it? THE WITNESS: I have no idea why Greg wanted it taped. I don't know. BY MR. OSTROWSKI: Q. You didn't want it taped? A. Greg asked me if I wanted it taped, and I -- Q. Did you want it taped? A. Not really. Q. Okay. But you taped it anyway? A. Taped it anyway, yes. Q. How many tape recordings were there? Were there three, or two, between -- well, let me rephrase that. How many recorded conversations of Mr. James did you make, whether he was speaking to you or someone else? A. I think there was two made. Q. Are you certain that there's not another one? A. I'm not certain, no. Q. And did you recall Mr. James saying that, three times, that he wanted to terminate the call because he was tired? A. Yes, I did. Q. And you just kept talking, right? A. I sure did. Q. Now, did you test -- did you testify in Court last month that there was no one eavesdropping in on conversations that were recorded between you and Mr. James? A. Would you repeat that question? Q. Did you testify in Court in September that, last month, that no one was eavesdropping in on these conversations that were recorded between you and Mr. James? A. Not to my recollection, no. Q. You did not say that? A. I said, not to my recollection. Q. Okay. Were there people eavesdropping? A. Well, if you call Greg taping it eavesdropping. Q. But he was listening in, right? THE COURT: Could he listen to the conversation while he was recording? THE WITNESS: I'm not sure, Your Honor. I don't know how this -- THE COURT: Did he have anything in his ear? THE WITNESS: I don't remember. BY MR. OSTROWSKI: Q. Well, was he speaking to you during the conversation, Greg Armenia? A. Yes. He was whispering. Q. Okay. What was he whispering? A. Ask him about the C. Q. Okay. And you don't know if he was listening to the conversation itself? A. I can't remember, no. Q. Now, you admit that on the tape you stated that, that you would pay him a dollar a disk? A. No, I did not. Q. You didn't say that on the tape? A. Not the way you are saying it, no. Q. Well, did you say in any way, shape or form on the tape that you'd pay him a dollar a disk? A. If the retrieval was sold, yes. Q. What I'm asking you is this, is there any statement on the tape of whatever nature in which you say you'll pay him a dollar a disk? A. Yes. Q. Okay. And why would you pay him a dollar a disk? Is that because of his good looks, for example, or because he's a nice guy, or for some other reason? A. No. If he programmed the new retrieval to sell, yes, I would have gave him a dollar a disk. That was explained. Q. You were going to pay him for work that he was going to do? A. That he would -- right. If he reprogrammed a new retrieval, not a look-alike, like Night Owl's, he would have got a dollar a disk from the other people, not from me. Q. Oh. So what was the purpose of you saying that you'd pay him a commission, or a dollar a disk? A. Well, the money would have came to us. It would have went to him. Q. Why would the money have come to you? Why couldn't he just go out and sell the program to anybody he wanted? A. Because it was still our copyright. Q. Now, what happened to the -- well, I just got to get to a certain point here, Your Honor. I'm going the wrong way. Did you say on the tape, quote, I may play I have lapsed memories at time, but I remember the statements I make? A. I remember that statement, yes. Q. You made -- you said that? A. Yes, I did. Q. Now, I'm going to just play the tape and ask you to listen, and I'll ask you another question. THE COURT: What are you playing? Excuse me. What are you playing? MR. OSTROWSKI: I'm going to play the tape. THE COURT: Just part of it. MR. OSTROWSKI: A very small part of it, Your Honor, and just ask a quick question. THE COURT: Well, why don't you ask him first, or have you already asked? MR. OSTROWSKI: Well, I think it would be fairer to the witness to allow him to hear what I'm asking him about. It's not actually a conversation, Your Honor. It's some aspect of the tape itself. (Portion of tape played.) MR. OSTROWSKI: I'm sorry, Your Honor. I've lost my, I thought I had the counter measured and I don't have it exactly. BY MR. OSTROWSKI: Q. Let me just ask you this. Did you notice in listening to the tape that the tape abruptly, the voices on the tape abruptly stopped? A. I heard that, yes. Q. And then you heard some mechanical noise? A. I'm -- Q. And then the tape, then the voices started again? A. I heard something, yes, but I'm not sure what it was. Q. Do you have any idea what, what might have caused that? A. No, I don't. Q. Did you erase anything from this tape? A. I didn't touch that tape. Q. You didn't. Do you recall saying, but I also told you, just before the tape, just before the voices stopped and there was that interruption? A. Repeat that, please. Q. Do you recall that you said, but I also told you, just before the tape stopped, during that interruption? A. But I don't know what was going to be said. Q. Well, let me ask you this. Do you know what was going to be said? A. No. That's what -- oh, the whole thing, no, I don't. Q. Well, now that you've answered that, which I didn't ask you, let me see if you can answer what I am asking you. Do you recall that you said, but I also told you, just before the interruption in the tape? Do you recall hearing that on the tape? A. Well, I couldn't be absolutely positive, no. Q. Do you recall saying that at any point during the conversation? A. I could have. Q. Do you have any idea what, what you actually said, that's not on the tape, after, but I also told you? A. No. Q. Do you recall that after the tape resumed, saying, going faster and better, and once these disks were selling at discounted rate? A. I don't remember that part, no. Q. Showing you Defendant's Exhibit 7 -- MR. OSTROWSKI: Is that where I left off, Your Honor? It's been so long. Do you have any notation that I'm off on that number? THE COURT: Defendant 7. MR. OSTROWSKI: I've apparently been marking -- THE COURT: Oh, you mean what your last number is? MR. OSTROWSKI: Yeah. THE COURT: I have it up to 5. MR. OSTROWSKI: I think I have marked a 6. THE COURT: Well, I don't have any record of it. MR. OSTROWSKI: Okay. BY MR. OSTROWSKI: Q. Can you identify that? THE COURT: 7 certainly is clear. THE WITNESS: Okay. This is a business certificate. BY MR. OSTROWSKI: Q. Could you speak up, please? A. It's a business certificate. Q. Of what? A. Of a business. Q. What business? A. C.A.R.R.S., C-A-R-R-S. Q. Is that a document that you filed with the Erie County Clerk? A. Yes. It's one me and Lou Manze filed, right. Q. Did you ever see a business certificate filed by Ken Helinski? A. Yes, I have. Q. Showing you Defendant's Exhibit 8, can you identify that document? A. No, It's not mine. I know it's -- I seen something similar to this Kenny had, yes. Q. Is that, looks like a copy of a business certificate of, that Mr. Helinski drew up? A. Looks like an addendum to me. It's an addendum to a business certificate. It's not a business certificate. Q. Well, when you say addendum, you mean amended? A. Amended, yes. Q. Showing you Defendant's Exhibit 9, can you identify that document? A. I think I've seen this one, too. Q. You've seen both of those? A. I'm -- THE COURT: Both of what? THE WITNESS: No, I'm not sure if I seen this one. I know I did see a business certificate. THE COURT: "This one" is Defendant 9? BY MR. OSTROWSKI: Q. Well, you've seen, I believe you stated now that you're not sure if -- A. I'm not sure if I seen this one, right. I thought that was a business certificate when I first looked at it, till I seen the -- Q. But you have seen Defendant's Exhibit 9? A. Yes, sir. I'm pretty sure. Q. Okay. And could -- and who showed you Defendant's Exhibit 9? A. I'm pretty sure it was Kenny Helinski. Q. He was your employer at some point? A. Yes, he was. MR. OSTROWSKI: Okay. I'd like to offer these in -- at least 7 and 9 in evidence, Your Honor, and ask him some questions about that. The business certificates. MR. KITCHEN: Your Honor, 7 and 9 are business certificates which indicate that Mr. Graham was somehow in business with somebody in 1989 and 1990, and I, I don't think there's been any, any foundation laid to admit these documents, simply because I don't see how they're relevant to this case. They don't involve parties to the action. 9 in particular doesn't even contain my client's name, and Defendant's Exhibit 7 contains my client's name, but only in conjunction with somebody else's name, certainly not with Mr. James. MR. OSTROWSKI: Well, Your Honor, I hold in my hand Plaintiff's Exhibit number 1, which is -- THE COURT: Excuse me. MR. OSTROWSKI: Plaintiff's Exhibit number 1, Your Honor, is a CD ROM which purports to be issued by a company called C.A.R.R.S., which is exactly the name of the company which is listed on Defendant's Exhibit 9 and therefore, I think it's obviously relevant, given the fact that Defendant's Exhibit 9 was not in fact filed by Mr. Graham, but other parties, and I think it's also a prior bad act. I'll throw that into the mix, in the sense that there's evidence of -- MR. KITCHEN: What's a prior bad act? MR. OSTROWSKI: Well, the appropriation of somebody else's company. THE WITNESS: Well -- MR. KITCHEN: There's been no evidence of any appropriation of anything. If Mr. Ostrowski wants to inquire about this -- THE COURT: Are there questions about the authenticity of Defendant's 7, 7, 9, Defendant 9? MR. OSTROWSKI: They're photocopies of -- THE COURT: I'm asking Mr. Kitchen, is there any question about the authenticity. I don't know if they're certified copies or what. MR. OSTROWSKI: They're not certified copies, Your Honor. THE COURT: So there may be some question about the authenticity. MR. OSTROWSKI: He's identified them, however, without that. THE COURT: Well, he said he -- MR. KITCHEN: He's seen -- THE COURT: -- he saw Defendant 9. And I guess with a later question he also said he had seen 7. MR. OSTROWSKI: Your Honor, I certainly reserve my right with respect to 9 to have further testimony and also possibly to get a certified copy from the Erie County Clerk's Office. I think 7 has been sufficiently -- MR. KITCHEN: Your Honor, that's hardly my point. My point is -- THE COURT: Well, that's why, that's why I asked the question, which hasn't been answered from you, whether or not there's a question on your part as to the authenticity of Defendant's 7, Defendant 9. They're not certified. They're copies. MR. KITCHEN: Well, all right. I would challenge them on that basis as well, Your Honor. THE COURT: Well, you don't know, but you have a right to be satisfied that they are authentic and real. MR. KITCHEN: Yes, sir. THE COURT: All right. MR. OSTROWSKI: I'm not, certainly in general terms a public document has to be a certified copy to be admitted. All I'm saying is that Mr. Graham, with respect to 7, he's already identified it. It's his document. He filled it out. And he, and he filed it. With respect to 9 -- THE COURT: But did he say he filled out 9? MR. OSTROWSKI: With respect to 9, Your Honor, all I'm attempting to show -- THE COURT: Well, wait a minute. 7, which one did he fill out, 7 or 9? MR. OSTROWSKI: 7. Can I show them to the Court? MR. KITCHEN: Well, no. I'll object to this. MR. OSTROWSKI: With respect to 7, 7 is the one -- THE COURT: I don't remember his saying he filled it out. BY MR. OSTROWSKI: Q. Well, did you fill this out, Mr. Graham? THE COURT: This is Defendant 7? MR. OSTROWSKI: Yes, Your Honor. THE WITNESS: Yes, I filled that out. MR. OSTROWSKI: He's certainly adequately identified 7, and all I'm trying to suggest with 9, and I certainly, I will get a certified copy if necessary, but I'd like to proceed, with Defendant's 9, is that he saw this, and therefore had an opportunity to see what somebody else, the name of another person's business, and therefore copied on, in his own certificate. MR. KITCHEN: Your Honor -- MR. OSTROWSKI: And that doesn't require any certification. THE COURT: What are the two dates involved? MR. OSTROWSKI: The date of 9 is April 6th, '89. MR. KITCHEN: Your Honor -- THE COURT: Wait a minute. Let me get the second date. THE WITNESS: That is not April 6th of '89. THE COURT: Pardon me? THE WITNESS: That is not April 6th of '89. MR. OSTROWSKI: 7 is notarized on November 19th, '90, and there's stamped filed, but I'll omit that at this point. MR. KITCHEN: Your Honor -- THE COURT: Well, wait a minute. Mr. Graham says you're wrong in the date you've assigned to Defendant's Exhibit 9, he said it was not April 6th, 1989. THE WITNESS: That's correct. MR. OSTROWSKI: Okay. Can I just ask him what he's talking about. THE WITNESS: November 19th, 1990. I know exactly when it was dated. MR. KITCHEN: Your Honor, I -- THE COURT: Excuse me? THE WITNESS: November 11th -- or, 19th, 1990. MR. OSTROWSKI: Well, can I just ask the witness again -- MR. KITCHEN: Your Honor -- MR. OSTROWSKI: Can I not be interrupted. MR. KITCHEN: I have an objection, Your Honor. COURT RECORDER: Wait. One at a time. THE COURT: Just a minute. It hasn't been admitted into evidence. We're still getting some preliminary information. Yes. Go ahead. BY MR. OSTROWSKI: Q. I'm asking you, with respect to Exhibit 9, which is -- A. This is not mine, so I don't know. Q. Well, no, I know it's not. A. Well, what do I have to do with this copy? Q. Okay. Well, you were challenging a date that I mentioned and we're just trying to clarify -- A. I was challenged on the one you were saying on mine. Q. Okay. Well, I never said that, but can we -- are you challenging my assertion that there's a date on there of -- A. On this 6th day, yes, 6th day of April -- Q. -- April 6th, '89. A. -- 19 -- 6th day -- THE COURT: One at a time, please. Wait for the question. Then you give the answer. THE WITNESS: 6th day of April, 1989. BY MR. OSTROWSKI: Q. And what does the other one purport to be dated as? A. 19th day of November, 1990. Q. And that's number 7? A. That is number 7. THE COURT: 7 is November 19, 1990. THE WITNESS: Yes, sir. THE COURT: 9 is April 6th, 1989? You said that was wrong before, Mr. Graham. THE WITNESS: No. He had mine in his hand, but he's correct. I was wrong. THE COURT: Defendant 9, April 6th, 1989? THE WITNESS: On which version, Your Honor? THE COURT: I don't care which version. THE WITNESS: On version -- THE COURT: One of them has a sticker, Defendant's Exhibit 9. THE WITNESS: Exhibit number 9, the 6th of April, 1989. THE COURT: All right. Thank you. MR. KITCHEN: Your Honor -- THE COURT: You said you -- Defendant's Exhibit 7 is filled out by you. Is there any question in your mind about whether it's a true document, Mr. Graham? THE WITNESS: No, sir. That was filled out by me. THE COURT: All right. You said you had seen Defendant's Exhibit 9. What do you know about it? THE WITNESS: Exhibit number 9, I've seen this at Comdex. THE COURT: At where? THE WITNESS: Las Vegas, Nevada. THE COURT: I see. Well, is it, do you have any question about its authenticity, legitimacy, correctness? THE WITNESS: As of November 19th, no. THE COURT: Well, as of, you sit here right now. THE WITNESS: No. It's, it is an authentical document, yes. THE COURT: All right. So now we have the offer of the two Exhibits and I'll listen to any objection you have. MR. KITCHEN: All right. My objection, Your Honor, is, well, also based I suppose upon the authenticity and the fact that it should, if it's a public document, it should be properly authenticated. But in addition, I think relevancy. I don't think Mr. Ostrowski's questioning has laid the foundation for introducing some business documents that relate to business that Mr. Graham might have been involved in, unless, you know, he can establish that it's germane to this case. I mean, I'm sure there are a variety of documents that Mr. Graham could authenticate adequately that have nothing to do -- THE COURT: Well, this is what I wonder, Mr. Ostrowski. You've talked about a prior bad act, some alleged misappropriation by Mr. Graham of C.A.R.R.S. and so forth, and yet Defendant's Exhibit 7 is a joint certificate, isn't it? Or shows the two of -- Mr. Graham and another in business, doing business as C.A.R.R.S. MR. OSTROWSKI: Exhibit -- THE COURT: 7. MR. OSTROWSKI: -- 7 is a business certificate for CARRS with no periods and two R's and lists two people, Richard Graham and Louis Manze, M-A-N-Z-E. The prior certificate -- THE COURT: So what's the relevancy of that one then? MR. OSTROWSKI: Well, they're relevant together. One, they wouldn't, either they're both relevant or neither is relevant, Your Honor. What I'm saying is that -- THE COURT: Well, I don't even know what 9 is about, doing business as what? MR. OSTROWSKI: 9 is a business certificate for a company called Computer Assisted Records Retrieval -- THE COURT: Which is the blowup of C.A.R.R.S. MR. OSTROWSKI: -- C.A.R.R.S. What I'm saying, Your Honor, is that this is the exact name of the company which is listed -- THE COURT: Computer Assisted Records Retrieval System. MR. OSTROWSKI: The initials, Your Honor, are the exact initials that appear on Plaintiff's Exhibit number 1 as his first CD ROM. He's claiming that this is his CD ROM and everything on it is his, and I'm wondering if it's actually his company. And it's relevant in so many ways. First of all -- THE COURT: It was his and somebody else's company, according to 7. MR. OSTROWSKI: Yes. I'm making a number of claims here. First of all, he's claiming ownership of these, of these programs, which is essential in a copyright case, and it's relevant to whether he actually owns the company. Second of all -- THE COURT: Whether it's a sole ownership or a joint ownership, you mean? MR. OSTROWSKI: Or whether it's his company at all, or somebody else's company. THE COURT: Well, his name is on Defendant's 7 as he and Manze's. MR. OSTROWSKI: Well, what I'm saying is -- THE COURT: At least that gets him over the, quote, at all, unquote, doesn't it? MR. KITCHEN: Well, Your Honor -- MR. OSTROWSKI: Well, but there's a complete -- what has happened here is that a name has been misappropriated with the prior parties not -- no longer -- THE COURT: His -- MR. OSTROWSKI: -- no longer involved at all. THE COURT: His co-certifier. MR. OSTROWSKI: Well, no. The first document was Kenneth Helinski and Louis -- THE COURT: What's the first document? MR. OSTROWSKI: 9. Louis Kanes. THE COURT: The earliest in time, yeah. Who is it? MR. OSTROWSKI: Louis Kanes is also on there. THE COURT: Louis Kanes? MR. OSTROWSKI: I can't, I honestly have trouble reading it, reading the name on it. THE WITNESS: That's Mr. Manze. MR. OSTROWSKI: I didn't think it was -- THE COURT: Here. Lend this to my myopic friend. MR. KITCHEN: Your Honor, what Mr. -- THE COURT: Just, let me just get something straight. MR. OSTROWSKI: Well, what I see, Your Honor, is the last name, I see Louis, and then I see a middle initial, which to me looks like J. Then I see a last name that appears to me to read, K-A-I, it's clearly an I, and Z, with an address of 333 Park Club Lane, Williamsville, New York. The second name on -- THE COURT: What's the address on 7 of Manze's? MR. OSTROWSKI: Louis F. Manze is -- THE COURT: Well, that's a Richard Manze's. Is Manze's also on 9? MR. OSTROWSKI: Well, I don't want to testify, Your Honor, but it looks, the address is different and it does not look to be the same name. I honestly don't know. It could be the same person. THE COURT: Well, who else but this Louis J. Kanes is on 9? MR. OSTROWSKI: Kenneth C. Helinski, Your Honor. THE COURT: Kenneth -- MR. OSTROWSKI: C. THE COURT: -- Wolinski? MR. OSTROWSKI: Helinski, as in Helen of Troy. THE COURT: Helinski. MR. OSTROWSKI: Actually with H-E-L-I-N-S-K-I. MR. KITCHEN: Your Honor, I move that all of this be stricken. We've essentially, these documents are not yet -- THE COURT: It's pretty hard to strike it. MR. KITCHEN: Excuse me, Your Honor? THE COURT: It's very difficult to strike it. MR. KITCHEN: Well -- THE COURT: It's been embedded in my brain to a certain degree at this point. MR. KITCHEN: Oh, yes, I'm sure, but the Court is certainly well equipped to be able to categorize and -- THE COURT: I can ignore it. I can ignore it. MR. KITCHEN: That's right. THE COURT: Being urged to do so. MR. KITCHEN: But a motion to ignore is, let's say, less conventional, Your Honor. In any event, what I -- I guess what I object to here and why I ask for a striking is essentially before these have been admitted into evidence we've really kind of reviewed virtually their entire contents and put that into the record. But in any event, I mean, what Mr. Ostrowski wonders is indeed wondrous. And they certainly raise, I suppose, legitimate questions. But there's a witness in the box, Your Honor, and questions could be put to him, and some foundation perhaps laid for introducing these documents. But you know, why aren't these questions put, Your Honor, and then perhaps there's some basis for offering these documents, based on something more than his wonders. THE COURT: All right. Objection sustained without prejudice. MR. OSTROWSKI: Well, Your Honor, I'm also moving the, moving it into evidence on the grounds that Mr. Graham has introduced reputation of his business character, and I believe that these documents indicate that he appropriated the name of another business. And I think he's opened the door on that. MR. KITCHEN: Well, opened the door to an area of inquiry, Your Honor, the asking of questions. The witness is here ready to answer them. If questions are put, I'm sure he will. MR. OSTROWSKI: Your Honor, I look at the clock and see that I have to run to my office and get my Notary stamp and make photocopies. THE COURT: That's right. All right. Recess. When are you coming back? MR. OSTROWSKI: It shouldn't take more than an -- I told one of my witnesses to be here at 1:30. I think that might be -- I don't think it's going to take all that long, and once I get the documents over there -- THE COURT: When are you going to eat? MR. OSTROWSKI: I usually don't. THE COURT: What time are we coming back? MR. OSTROWSKI: 1:30 would be fine with me. THE COURT: 1:30. MR. KITCHEN: Fine, Your Honor. THE COURT: Recess till 1:30. (Recess taken.) THE COURT: On the record. CONTINUED CROSS EXAMINATION BY MR. OSTROWSKI: Q. Mr. Graham, Exhibit 37, Plaintiff's, can you identify that? A. That's PDSI-002. THE COURT: Excuse me? THE WITNESS: PDSI-002. BY MR. OSTROWSKI: Q. And what is that item? Whose, who belongs -- who owns it? A. I do. Q. And what was the name of the business you were doing business under when you put that out? A. C.A.R.R.S. Q. And what does it say on the top there, as far as the owner of the disk? A. C.A.R.R.S. Q. And could you spell that out and include any periods, if any? A. C.A.R.R.S. Q. Okay. Did you file a business certificate for C.A.R.R.S.? A. No, I didn't. Q. Okay. You were aware that another person had filed a business certificate with that name? A. I know that there's a certificate. Q. Are you aware that there's another person who filed a business certificate by that name? A. I know of a certificate, yes. Q. Did he prepare -- THE COURT: Did you know at that time? THE WITNESS: I didn't know at that time, no. BY MR. OSTROWSKI: Q. You didn't know at which time, the time -- A. At that time, at the time that disk was produced, no. Q. You did not, you had not seen the business certificate that you stated you saw before? A. Right. MR. OSTROWSKI: Let me grab those. BY MR. OSTROWSKI: Q. Showing you Defendant's 9, not in evidence. You did not see that document prior to the production of Plaintiff's 37, a CD ROM? THE COURT: What do you mean, the production? THE WITNESS: No, I did not. THE COURT: The production of -- MR. OSTROWSKI: Well, what was -- THE COURT: What you have in your hand is what, left hand, Mr. Ostrowski? MR. OSTROWSKI: Plaintiff's 37, Your Honor. THE COURT: I see. You're asking him whether he saw Defendant 9 before he produced Plaintiff 37. THE WITNESS: No, I did not. BY MR. OSTROWSKI: Q. You did not? A. No, I did not. Q. Where did you get the idea for a business name of that identity that you, C.A.R.R.S. with periods, and two R's? A. The disk, Kenny Helinski is the one who put that label on that disk. Q. Okay. Well, whose disk is it? A. It's my disk. Q. It's your disk? A. It's my property, his label. Q. His label? A. You got it. Q. Okay. So it's his name? A. That's his label, yes. THE COURT: Who is his? THE WITNESS: That's his name, Kenny Helinski's company, yes. THE COURT: Who? THE WITNESS: Kenny Helinski's corporation, right. BY MR. OSTROWSKI: Q. So, well, it's your CD ROM, right? A. You got it. Q. But it's his, has the name of his company on it? A. The name of his company is on it. Q. Okay. And you hadn't seen the business certificate prior to the release date of this -- A. Las Vegas. Right. In Las Vegas as I stated. THE COURT: Mr. Graham, please, please. Ground rule. Wait for the finish of the question. Then you answer. THE WITNESS: Yes, sir. THE COURT: Don't jump in. BY MR. OSTROWSKI: Q. You didn't see the business certificate prior to the date of release of Plaintiff's 37? A. That's correct. Q. Now, it has 1990 on it at the bottom, is that correct? A. That's correct. Q. And what is that, does that refresh your memory as to when it may have been released? A. That disk, I know when it was released. Q. When? A. It was released in October. Q. October what? A. October of 1990. Q. And you hadn't seen a business certificate prior to October 1990? A. No, I have not. Q. Please explain why the, why a disk that you own has somebody else's business name on it. A. Because at that time I worked for Kenny Helinski, and I put the disk together and it was my products on it. Q. It was your -- A. And it was his label. Q. His label? A. That's right, that's correct. Q. And what did you contribute to it? A. I contributed all the programs and I contributed the Night.EXE on that disk. Q. Is there a Night.EXE on this disk? A. Inside, yes, there is. Q. Is this the one with the, Jeff Anderson's program on it? A. Jeff and mine, yes, it is. Q. Well, you've already testified it was essentially his program, isn't that correct? A. I testified it was mine and his. Q. Well, I'm not going to go through that over and over again. THE COURT: Please keep your voice up. MR. OSTROWSKI: I'm sorry, Your Honor. I was just saying, I'm not going to rehash that. We've covered that thoroughly. BY MR. OSTROWSKI: Q. And what about the equipment involved in producing Plaintiff's 37, was that yours or Helinski's, or somebody else's? A. What do you mean equipment? Q. Well, you tell me. A. At that time -- Q. Was there any equipment involved? A. At that time it was my equipment. Q. What, which? A. Computer, my equipment. Q. What type of computer? A. 386. Q. 386? A. Right. Q. Where did you buy it from? A. A company down in Florida. Q. And how did you pay for it? A. Credit. Q. Credit? A. Uh-huh. Q. How much was it? THE COURT: Wait a minute. What did you say, uh-huh? THE WITNESS: Yes, sir. Well, I think it was $1,900. BY MR. OSTROWSKI: Q. $1,900? A. Right. I think. Q. Okay. What about Plaintiff's Exhibit 1, can you identify that just for the record? A. That's C.A.R.R.S. PDSI-001. Q. Okay. And is that, do you own that? A. No, I do not. Q. You don't? A. No. Q. Who does? A. Kenny Helinski, C.A.R.R.S. Q. So Helinski owns Plaintiff's Exhibit 1? A. Yes, he does. Q. And you don't have any copyright in any of the programs on that disk? A. No, I don't. Q. Now, are you claiming that there are, that there are original pro -- now, I'm going to ask you again, wasn't there a third tape recorded conversation involving Larry James? MR. KITCHEN: Objection. Asked and answered. MR. OSTROWSKI: Well -- THE COURT: He said he's going to ask him again. I'll allow it. Cross examiner has certain license, not yet abused. THE WITNESS: Not that I can recollect, no. BY MR. OSTROWSKI: Q. Do you swear that that's true, that there's no -- A. Not that I can recollect. I'm not going to swear to any - - THE COURT: He's under oath so he's swearing to it. BY MR. OSTROWSKI: Q. There wasn't a conversation with Ralph Marquardt and you, recorded? A. Not that I know of. Not that I am aware of at all. Q. Did you receive such a tape from Greg Armenia? A. No, I did not. Q. And did you give such a tape to your lawyer? A. Not that I know of. Q. Now, I believe you stated on direct examination that you don't do -- and cross, primarily cross, you don't do any advertising, right? THE COURT: What do you mean advertising? MR. OSTROWSKI: Advertising for CD ROM's. THE COURT: Well, I mean, odds and ends of advertising in this business, I've been surmising, are things called bulletin boards. Are you eliminating that? BY MR. OSTROWSKI: Q. I'm asking you if you did any type of -- THE COURT: Any advertising. BY MR. OSTROWSKI: Q. Any type of advertising to advance the sale of his products, the CD ROM products? A. It really still depends on what you consider advertising. Q. What do you consider advertising? A. I consider advertising in magazines and books and things. Q. Did you do any advertising that you don't consider to be advertising? MR. OSTROWSKI: Withdrawn. I couldn't resist. BY MR. OSTROWSKI: Q. Okay. So it's your position that you did not, and we're talking about, you know the period we're talking about, we're talking about from over the last year and a half or two years or so. A. I have not put any ads in any magazines, no. Q. Okay. Have you done any advertising other than through magazines? THE COURT: Including bulletin boards? THE WITNESS: Oh, I advertise my product on -- THE COURT: Mr. Ostrowski? MR. OSTROWSKI: Well, I guess I would limit it, Your Honor, to advertising in which some amount of payment was made to the advertiser or the medium of advertising. Paid advertising. THE WITNESS: No. I've never paid for advertising, that I am aware of. BY MR. OSTROWSKI: Q. Doesn't your financial statement list an expenditure for advertising? A. I'm not sure if it does. I haven't looked at it. I was ordered to turn it over to you. THE COURT: Ah. This finally tells me what my F/S means. Financial statement. BY MR. OSTROWSKI: Q. Showing you Defendant's Exhibit 10, can you identify that document? THE COURT: What Exhibit? BY MR. OSTROWSKI: Q. Defendant's Exhibit 10. A. That's a financial report for a 12 a month period ending July 31st, 1993. Q. And was that, did you supply that to your attorney? A. Yes, I did. Q. Okay. And can I just see it. Is this an accurate reflection of the expenditures and income and et cetera, financial information about your company? A. You'd have to call in my accountant for that. She's the one that takes care of that. I don't. Q. Okay. So you don't swear by any of the figures in here, do you? A. I do not swear by any of them figures. Q. You don't? A. She takes -- Eleanor Schreiber does all my accounting. Q. Okay. Who pays the bills? A. I do. Q. Did you pay any money for advertising? A. It depends on what you consider advertising, magazines and that, no, I have not. Q. Showing you Defendant's Exhibit 10, asking you to look over the front page, under expenses, at the second item? A. Advertising. Q. Ask you to reconsider your answer to that question. A. It says advertising. We paid money for advertising. Q. Okay. Did you? A. It says I paid. Yes, I guess I did. Q. Where does your accountant get your, get her information from, the basic documents to do the -- A. Off my invoices. Q. Okay. MR. KITCHEN: Your Honor, I'll object to the line of questioning and move that the last be stricken. There's -- I don't know what the relevance is as to whether -- THE COURT: Well, if it's not relevant, you should have objected earlier, when we first got into this matter of whether or not he did any media advertising. This all stems from that objection. Overruled. BY MR. OSTROWSKI: Q. Now, when did you form -- did you form a corporation to distribute your CD ROM's? A. Yes, I did. Q. What's the name of it? A. Night Owl's Publisher, Inc. Q. And what kind of a -- is that a New York corporation? A. Yes, it is. Q. When did you form that? A. August of 1992. THE COURT: Excuse me? THE WITNESS: August of 1992. BY MR. OSTROWSKI: Q. Who are the shareholders? A. Myself. Q. Who are the officers? A. Myself. Q. You're the President and Secretary? A. I am. Q. Now, what copyrights does, with respect to CD ROM's, does this corporation own? A. Under what, what are you talking about, copyrights does the corporation own? THE COURT: Does the corporation own any copyrights? THE WITNESS: It owns several copyrights. BY MR. OSTROWSKI: Q. Which? A. It owns a -- Q. With respect to file retrieval systems? A. Except, it runs, it owns a couple doors, a couple of data bases. Q. I'm talking about file retrieval programs? A. Oh, file retrieval programs. It owns three. Q. Which? A. What do you mean, which? Q. Which three? A. Well, we own W-Night. We own Night. We own W-Install. THE COURT: We is the corporation? THE WITNESS: The corporation. We own Install. We own F-Browse. F-Browse. We own Vizadoor. We own a CD ROM door. THE COURT: When you say we, I'm assuming you mean the corporation. THE WITNESS: The corporation, right. Yes, sir. And that's it. BY MR. OSTROWSKI: Q. Well, showing you Plaintiff's Exhibit 21, is that a program that's owned by the corporation? A. No, it's not. Q. And what does it say on the top? A. Night Owl Publisher, Inc. THE COURT: What's it say? THE WITNESS: Night Owl Publisher, Inc. Copyright Night Owl Publisher, Inc. BY MR. OSTROWSKI: Q. Okay. So the copyright is incorrect? A. The programmer has filed the copyright wrong, yes. Q. I'm sorry. I didn't hear that. A. The programmer wrote the wrong copyright, yes. Q. So who owns the copyright to Plaintiff's Exhibit 21? A. We haven't assigned it yet. We haven't assigned it yet. Q. Does anyone own the copyright to Plaintiff's Exhibit 21? A. Phil Swanson. Q. This is Phil Swanson's program? A. Phil Swanson owns that code, as of now, right. Q. Okay. MR. OSTROWSKI: Your Honor, in light of the testimony I'd ask for the immediate lifting of the confidentiality order with respect to Plaintiff's 21, since this party has no standing to make a motion for any such order. And I'd like to be able to turn it over to my client immediately, to begin looking at it. MR. KITCHEN: Well, I'm going to object to that, Your Honor. This particular program was prepared by Phil Swanson, the same person who was our expert witness, and paid for by my client. THE COURT: Which gives what result? MR. KITCHEN: Well, it gives, it contains proprietary information. THE COURT: Who's the proprietor? MR. KITCHEN: Well, the proprietor in this particular case is my client. He's the only one presently using this particular program. And he has an ongoing contractual relationship with Phil Swanson to perform the programming for Night Owl Publishing, or whatever, and subject to whatever arrangements that they have between them, as to ownership, distribution, publication, et cetera. To say that because it has not been thoroughly defined as between Phil Swanson and Night Owl Publishing as to exactly how the copyright either should read or shouldn't read -- THE COURT: Now, I don't know whether you're objecting to this line of questioning by Mr. Ostrowski or objecting to Mr. Ostrowski's assertion that there's a loophole in the confidentiality agreement that allows this to filter through to Mr. James. MR. KITCHEN: The latter, Your Honor. THE COURT: And why do you say that? MR. KITCHEN: Well, because -- I thought I was explaining it rather directly, Your Honor, but -- THE COURT: Well, my problem I guess is, how does the corporation get included in, or material from the corporation get included in the confidentiality agreement? I hereby agree the contents of any programs supplied by plaintiff -- MR. KITCHEN: Right. THE COURT: -- pursuant to the order will be kept confidential -- MR. KITCHEN: That's right. THE COURT: -- and not disclosed to any third party, including James. MR. KITCHEN: Right. THE COURT: Now -- MR. KITCHEN: This certainly falls into that category, Your Honor. THE COURT: This is the corporation, isn't it? MR. OSTROWSKI: Well, Your Honor, it says corporation on it, but Mr. Graham has stated that it's owned by Mr. Swanson. THE COURT: Well, even if it's a corporation, the corporation is a different person than the plaintiff, isn't it? MR. OSTROWSKI: That's what I was going to -- I was going to get into that, Your Honor, except he said that the corporation didn't own it. I was going to make the same motion on that regard. MR. KITCHEN: Well -- THE COURT: What my point is, what is there in the evidence to show that this is supplied by Mr. Graham, the plaintiff? MR. KITCHEN: Your Honor, we voluntarily in this litigation provided this program with the express understanding it was going to be governed by the agreement that the Court has in its hands right now. THE COURT: Ah. The expressed understanding? MR. KITCHEN: Yes, sir. THE COURT: I mean, was it the understanding here, or was it expressed? MR. KITCHEN: Well, Your Honor, I think you just read the words. THE COURT: Well, what I read is something as to anything supplied by plaintiff. Now you're saying there was an express understanding that this was supplied by plaintiff. Now, that, this means what, any such program. Let's see, such refers back -- MR. KITCHEN: Your Honor, I remember -- THE COURT: Wait a minute. Let me see. Such -- I execute this agreement in anticipating of, anticipation of -- this is Mr. Ostrowski's -- of receiving one or more computer programs from you, Mr. Kitchen, for the plaintiff, Mr. Graham, who is pursuing a copyright claim. All right. Now, I had been hung up on the situation that this seems to come from the corporation or a third, or second individual, not from Mr. Graham, but I guess you could give this an intelligent reading and mean that anything that Mr. Kitchen on behalf of Mr. Graham supplies, whether it's owned by somebody else or not, would be covered. MR. KITCHEN: That's exactly our position. MR. OSTROWSKI: Well, I'll stipulate that I received a copy of this. I'll stipulate that I received a copy of that from the plaintiff. This particular copy, I don't know how it ended up in Court, whether it was Mr. Kitchen, Mr. Graham or Mr. Swanson. But what I'm saying is that the presupposition of the order was that the plaintiff has some ownership rights in this program that -- THE COURT: Where do you find that? MR. OSTROWSKI: Well, what -- there's no purpose in having a confidentiality order to protect the plaintiff unless the plaintiff has some standing to claim ownership in the program. Since the evidence has revealed that he does not, I'd ask that the order be lifted. THE COURT: Well, the evidence may or may not show that. Mr. Graham is in disagreement, evidenced by his nodding his head up and down when you mentioned the fact that he had some ownership in it. I don't know what that is, whether it's covered or not, and I doubt if it's really talked about in Judge Maxwell's order. He said on November 24, 1992, it is hereby ordered that the plaintiff, which according to the title of the case, and not the particular document you signed, is actually Richard E. Graham, d/b/a Night Owl Computer Company. Now we have a corporation rather than a business name, but I suppose you can walk through that all right. Hereby ordered that the plaintiff on or before blah, blah, blah, shall make available for inspection computer program, copies of plaintiff's entire submission to the copyright office. Further ordered that plaintiff on 10 days notice make available to defendant's counsel or an expert witness any or all subsequent programs of the plaintiff. Further ordered such disclosure shall be contingent on a delivery to plaintiff's counsel of a non-disclosure and confidentiality agreement, which is what we have from Mr. Ostrowski and from his expert, plaintiff's expert. Now, I don't know. MR. KITCHEN: Well, Mr. -- THE COURT: Ambiguity seems to be raining from the heavens. MR. KITCHEN: Well, Your Honor, perhaps, but Mr. Ostrowski seems to assume that, even if there has been a slight change in ownership, that that document in his hand is suddenly now in the public domain. That's simply not true. It contains -- THE COURT: Let me ask just one question, just to clarify it in my mind. The action itself is Mr. Graham d/b/a. MR. KITCHEN: Yes. It was -- THE COURT: Yet there's a corporation. MR. KITCHEN: Well, I think he incorporated since we started the action. THE COURT: Oh, all right. MR. KITCHEN: And if that renders this whole proceeding -- THE COURT: No, no, no, no. That doesn't render anything bad, but of course, Mr. Graham and his corporation technically are two different people, although being 100% owned and 100% officered by Mr. Graham, I suppose there are reasonable grounds for piercing the veil and construing that the corporation is the same person as Mr. Graham. MR. KITCHEN: Well, I move to add the corporation as a party, if that's -- THE COURT: Pardon me? MR. KITCHEN: Then perhaps I should move to add the corporation as a party. THE COURT: Well, unless you want to dissuade me from piercing the veil. MR. KITCHEN: Well, I'm not sure it makes -- I think some -- THE COURT: Well, if I pierce the veil, then it's the same person. MR. KITCHEN: I agree, Your Honor. And by the way, as far as I understand, this is a closely held corporation. THE COURT: That's what I said, 100% owned, 100% officered. MR. OSTROWSKI: Well, I was consider -- THE COURT: Now, how do you get outside of that, Mr. Ostrowski? MR. OSTROWSKI: I was considering adding the corporation, naturally, at a certain point, as a party. I would -- THE COURT: Do you not agree with me that this corporation and Mr. Graham essentially are one and the same person? MR. OSTROWSKI: Yeah. I would agree with that, but I'd be concerned that -- THE COURT: Therefore, the confidentiality order and agreement would run to the corporation anything it supplied also. MR. OSTROWSKI: I would not stipulate to that, no. THE COURT: What ground would you argue in? MR. OSTROWSKI: I'd have to know much more about the corporation than I know. Do they keep up the formalities of acting separately as a corporation? I see a camera expense on the expense account that made me wonder, but it looks like it's run as a corporation. And I certainly wasn't going to -- THE COURT: What expense on the -- MR. OSTROWSKI: Oh, there was a camera purchase. I don't know what that was for. In the business records. MR. KITCHEN: Well, Your -- now, this is inappropriate, Your Honor. MR. OSTROWSKI: Well, I was going to get in -- MR. KITCHEN: If he wants to ask my client -- THE COURT: Now, I would see if there were something in the financial statements that showed monies paid out to Mr. Graham as a person, employee, albeit President, Vice President, Secretary and Treasurer, you get a small standing for saying they're two separate entities, but that's very small. MR. KITCHEN: Well, let him inquire. MR. OSTROWSKI: Well, I -- THE COURT: Particularly when we take the tax laws into consideration and know what happens there. MR. OSTROWSKI: I would still argue, Your Honor, even with that amendment, that the, Mr. Graham and his corporation are basically identical, that he's testified that this belongs to Mr. Swanson. So my argument is, what standing does he have to, at this point in a trial, insist on an order of confidentiality when he doesn't own the, he doesn't own the program. THE COURT: Well, the problem with that is that the order, the confidentiality order, doesn't talk about who owns the thing. It says that the plaintiff will make available to the defendant programs, source codes and so forth. Doesn't talk anything about ownership. MR. KITCHEN: That's correct, Your Honor, and if we had known that the -- MR. OSTROWSKI: Actually it does. MR. KITCHEN: -- defense was going to -- THE COURT: Where? Wait a minute. Where? MR. OSTROWSKI: It says in the first paragraph on the second page -- THE COURT: That's what I was looking at. MR. OSTROWSKI: -- any and all subsequent programs of plaintiff. I think that is language which would justify my position. THE COURT: Now, what you signed said, I hereby agree that the contents of any -- I'll go back to the, such programs, which I'll go back to, supplied by plaintiff. Now, such programs are one or more computer programs received from Mr. Kitchen. Nothing about ownership there. MR. OSTROWSKI: Well, I would suggest that the document has to be read as a whole, and the earlier statement of plaintiff governs the subsequent paragraph. MR. KITCHEN: Your Honor -- MR. OSTROWSKI: And I, you know, I'm not going to press this issue, but I've already made a motion to lift the confidentiality order. THE COURT: I know you did. MR. OSTROWSKI: And I'm adding, I'm throwing this into the mix. That's all I'm saying at this point, that it, you know, I -- MR. KITCHEN: Well, if the Court's going to consider it, I want -- THE COURT: I'll leave that, I'll leave that resting with the other then, which namely we're getting some paper reply from Mr. Kitchen. He can have that in mind also. MR. KITCHEN: Well, now, in light of that, Your Honor, am I to understand that the Court anticipates that plaintiff will supply a paper reply to the motion? THE COURT: That's the way we left it earlier. MR. KITCHEN: Oh, I'm sorry. I guess I misunderstood. But now I'm aware. THE COURT: Yeah. Yeah. That's why I held it in abeyance. BY MR. OSTROWSKI: Q. Okay. I'm showing you Plaintiff's Exhibit 20. Who owns the copyright to that program? A. The corporation. Q. And now why does Mr. Swanson own the copyright -- I take it he -- why does Mr. Swanson own the copyright to Plaintiff's 21, because he wrote it? A. He owns it until he transfers it. I paid for it already. I own it in a sense, but not yet, because the transfer has not been completed. Q. Okay. THE COURT: Your having paid for it -- THE WITNESS: I have paid -- THE COURT: -- does not give you 100% ownership. THE WITNESS: Not until we copyright the right way, right. THE COURT: Not until what? THE WITNESS: My copyright attorney has filed for the copyright. He's handling it. THE COURT: Copyrighted by whom? THE WITNESS: Loverchek, Wayne Loverchek. MR. OSTROWSKI: The attorney. THE COURT: Oh, he's an attorney. THE WITNESS: He's the copyright attorney, yes. THE COURT: Yeah. Copyright to be owned by whom? THE WITNESS: By Night Owl Publisher, Inc. MR. OSTROWSKI: Has he signed -- THE COURT: What happens to Swanson in that situation? THE WITNESS: Swanson is transferring, oral transformation. THE COURT: Oral transfer. THE WITNESS: Right. BY MR. OSTROWSKI: Q. He hasn't signed anything over to you at this point, is that correct? A. Except the way he did it here. Q. Where? A. Up on top of the page. THE COURT: What's it say there? THE WITNESS: Copyrighted Night Owl Publisher, Inc. BY MR. OSTROWSKI: Q. Now, who owns the copy -- you said the corporation owns the copyright to 20? A. Right. Q. Now, why doesn't the author -- who's the author of 20, by the way? Is that Brian Martin? A. Brian Martin's. Q. Why doesn't Brian Martin own the copyright to Plaintiff's 20? A. Why doesn't he own it? Q. Yeah. Why doesn't he own it? A. Because we've copyrighted it. We've already transferred copyright on this. Q. You've transferred copyright? A. He has already, right, he has already transferred copyright of his, his statement. Q. How did he do that? A. Well, I could show you better by showing you the copyrights. Q. Well, all I want to do is have you tell me. A. Down on the bottom there's a spot there, well, how did you transfer your copyright, by oral, by written. We did it by oral, and he transfers it over to Night Owl Publisher, Inc. Q. He signed a copyright form? A. Yes. He does sign a copyright form. Q. Did Larry James sign that same form? A. Did Larry James sign that one? No, he didn't. Q. Okay. So the corporation owns Plaintiff's 20? A. Right. Q. Just to clarify. Who owns the copyright to Plaintiff's 19? THE COURT: Is that also a program? MR. OSTROWSKI: Yes, Your Honor. It's the earlier version. THE WITNESS: That's the one in dispute. I copyrighted that myself. BY MR. OSTROWSKI: Q. Well, they're all in dispute. A. Right. Q. You, it's your testimony you own the copyright to that? A. Right. Q. And you personally would own the copyright to the subsequent programs going back to C.A.R.R.S. 2, more or less? A. To C.A.R.R.S. 2, yes. Q. Not C.A.R.R.S. 1? A. No. Q. There wasn't anything to copyright in C.A.R.R.S. 1, right? A. Nothing. Q. So you owned a copyright from everything from C.A.R.R.S. 2 all the way up until Plaintiff's 20 -- I'm sorry, no, Plaintiff's 19, personally, right? A. Except for C.A.R.R.S. -- or Night Owl 3. Q. Folio? A. Yeah. Folio. Right. Q. Except for Folio. You've testified to that. A. Except for Folio. Right. Q. You owned -- the file retrieval programs, that's all I'm talking about. You owned those -- A. Right. Q. -- from C.A.R.R.S. 2 to Plaintiff's 19. And the corporation owns Plaintiff's 20 and Swanson owns Plaintiff's 21? A. Well -- THE COURT: So when you're saying earlier that you own it, you're talking about you, Mr. Graham, or you, the corporation? THE WITNESS: The corporation. THE COURT: Then, Mr. Ostrowski says, and then the corporation as though he's talking about some other person. THE WITNESS: Or myself. THE COURT: It's difficult. THE WITNESS: Myself. THE COURT: People incorporate for convenience and other purposes, and they don't sometimes consider all the ramifications. BY MR. OSTROWSKI: Q. Speaking of which, did you incorporate in order to hide your assets from this lawsuit? A. No, I did not. Q. The counterclaim of Larry James? A. No, I most certainly did not. Q. I take it the corporation hasn't taken over any of the copyrights that you already said that are yours? A. Yes, it has. Q. They're still yours? A. No. Q. There's been no assignment -- A. The corporation has taken over the copyrights. Q. -- no assignment of any kind from you to the corporation? A. I didn't need none on some of them. Q. Well, that's not what I'm asking you. Did you -- THE COURT: What did the corporation give to you as consideration for that? THE WITNESS: Nothing. THE COURT: You just made a gift to the corporation? Wait a minute. Wait a minute. Let me find out. Let's find out. There are lots of legitimate ways of doing it. A corporate person can buy something, a corporate person can give somebody stock in exchange for something, or can be a recipient of a gift, and I'm trying -- THE WITNESS: Well, the five new programs we got we paid for, so the corporation owns -- THE COURT: No. You're talking about the older ones now. THE WITNESS: No. Brand new ones. This is five new products that we purchased. THE COURT: No, but the question was about older ones, I thought. THE WITNESS: Oh, the older ones, no. It was a gift. THE COURT: They're a gift. THE WITNESS: I did -- no, I didn't charge myself. No. THE COURT: All right. Go ahead. MR. KITCHEN: Your Honor, I would just like to say, I'm not sure that we aren't exceeding Mr. Graham's capacity to explain things from a legal or accounting standpoint. Typically when a small business, unincorporated, incorporates, it transfers say business assets to the corporation in exchange for the stock. You know, and effectively ownership, you know, technically changes that way, and in reality it doesn't look like it changes at all. THE COURT: Well, that's what I said. That's one thing that happens. You incorporate and there is stock to be issued. It issues to somebody and there's a consideration for the issuance of stock, which can be money or it can be assets, or both. That's why I asked that. BY MR. OSTROWSKI: Q. All I'm asking you, Mr. Graham, is, did you sign any document which transferred the copyright of Plaintiff's 19 and the previous ones, from C.A.R.R.S. 2 on, to the corporation? A. Did I sign -- no, I did not sign anything to the corporation, no. Q. Now, what -- okay. August 1992 the corporation started, is that correct? A. August of '92, yes. Q. Now, is that when you filed the papers or is that when you actually started doing business under that name? A. That's actually starting business, yes. Q. Now -- THE COURT: There is a certificate of incorporation, I assume, that has a certain date, not that we need it, but at least that would show a date of -- THE WITNESS: It's all right. THE COURT: -- transformation. BY MR. OSTROWSKI: Q. When did you have your -- did you have an organizational meeting? A. Yes, I did. Q. When was that? THE COURT: Pretty hard to do when he's everything. You met with yourself someplace. MR. OSTROWSKI: Well, you've got to meet with your lawyer at least. THE WITNESS: I met with my lawyer, right. BY MR. OSTROWSKI: Q. What month? A. We met in, I think it was either June or July. THE COURT: Of? THE WITNESS: 1993. BY MR. OSTROWSKI: Q. Well, okay. THE COURT: Even though you were incorporated in August of '92? THE WITNESS: You have to have one meeting a year, yes, sir. BY MR. OSTROWSKI: Q. No, but what I'm asking you, when does your first meeting, you have your organizational meeting to set it up and appoint yourself president, and so on? A. June -- July. Q. Of which year? A. 1992. Q. Okay. Now, in very general terms, what was -- what's the name of the caption of our action? What was your d/b/a again, Night Owl's? A. Night Owl's Computer Service. Q. Okay. Now, just prior to becoming -- THE COURT: The lawsuit is evidently entitled Richard E. Graham d/b/a Night Owl Computer Company. THE WITNESS: It was Night Owl's Computer Service. THE COURT: So this is wrong. THE WITNESS: Yes, sir. BY MR. OSTROWSKI: Q. Okay. Just in the time, in the few months before the, you formed the corporation, in general terms, what was this Night Owl Computer Service doing businesswise, selling CD ROM's? A. Selling CD ROM's, yes. Q. Is that basically what it does? A. Basically publishing CD ROM's, yes. Q. And just in general terms, what were the assets of the d/b/a? THE COURT: Assets of the person who was doing business as? MR. KITCHEN: I'll object to that. THE COURT: Wait a minute. MR. KITCHEN: It's irrelevant. THE COURT: Finish the question first and then we'll see what the -- don't answer right away. BY MR. OSTROWSKI: Q. Well, the -- you're doing business as, under Night Owl Computer Service. What I'm asking you is, in, say 19 -- in June of 1992, what are the assets of the business? MR. KITCHEN: I'll object to that as irrelevant. It's irrelevant as to what his assets were in any event, but it's certainly irrelevant as to what they were in 1992. MR. OSTROWSKI: Well, I'm trying to -- THE COURT: Well, it's such a nebulous situation. You get an individual doing business as something, and what's the entity, a storefront or what? MR. OSTROWSKI: It's -- well, I think legally it's basically just a person. He's the sole proprietor and -- THE COURT: Yeah. Just a person. A person can have assets that are not used in or devoted to the business, and other assets which are used in the business, so what are you asking about and -- MR. OSTROWSKI: Well, I'm clearly asking -- THE COURT: Well, I can't get it straight in my mind what, well, what the significance would be of any answer he gave. MR. OSTROWSKI: Well, I'm just asking in general terms, the business, Night Owl Computer Service, what business assets did it have in June of 1992? MR. KITCHEN: Object on the grounds of relevance. MR. OSTROWSKI: Why? Why is it not relevant? It's so obviously relevant. MR. KITCHEN: If it's so obvious, then it should be obvious enough for Mr. Ostrowski to give us some explanation. MR. OSTROWSKI: Right. We're suing. We have a counterclaim for profits derived from an infringed program. MR. KITCHEN: Well, yes. But then it's appropriate to ask about profits, about profit and loss, about cash flow. MR. OSTROWSKI: Well, I'm also trying to establish -- THE COURT: And not to, not to some business, but to Mr. Graham as a result of the business. MR. KITCHEN: Right. MR. OSTROWSKI: But I'm also trying to establish the relationship between -- my next question is, what assets were transferred to the corporation. I'm trying to establish what we're dealing with. THE COURT: Now you've moved into a later time stage. MR. KITCHEN: Well, and also, if he's talking about general assets in the corporation -- I mean, what's relevant here, Your Honor, is whether or not he made any money off the selling of CD ROM's. That's the issue. Mr. Ostrowski wants to go on a fishing expedition to find out any and all of Mr. Graham's assets. I don't think that's appropriate. THE COURT: Well, I don't think he's fishing for all of Mr. Graham's assets. That's what I'm trying to straighten out. He wants to find out what assets there were in the business, and I have trouble myself with seeing the difference between the assets of an individual and the assets of an individual who's doing business as, and the assets of the business. MR. KITCHEN: Well, I'm also concerned -- THE COURT: But I think you can clarify it. MR. KITCHEN: Well, but he's -- MR. OSTROWSKI: Well, I can ask him some specific questions. MR. KITCHEN: But, Your Honor, even if we pin it down to being assets of the business, let's say office furniture, and it turns out he has $15,000 worth of office furniture, or $1,000 worth of office furniture, what difference does that make, how is that relevant to this lawsuit? THE COURT: Depends when he bought it. MR. KITCHEN: Well -- THE COURT: And how he paid for it. MR. KITCHEN: Well, that is in terms of expense. That is in terms of money coming in and money coming in and money going out. THE COURT: That's a utilization of income. MR. KITCHEN: That is right. THE COURT: And it shows that there was a certain income. MR. KITCHEN: Your Honor, income is I think maybe an appropriate area. I do not think that assets are. MR. OSTROWSKI: Well, let me -- THE COURT: Well, receipts, if I can transfer the word income into receipts, are relevant if all or part of the receipts are transformed into business property. MR. KITCHEN: Well, yes, Your Honor, but -- THE COURT: Therefore, the business property would be somehow probative of business receipts. MR. KITCHEN: Your Honor, if Mr. Graham were being evasive about income and the only way of uncovering them were to inquire about assets at point A versus assets at point B, I could well understand this nature of the inquiry. But this is apparently Mr. Ostrowski's starting point. Now, we've given him financial information about cash flow. It even has some things, I suppose, that seem to be addressed to assets somewhat. But I, this entire line of questioning about him asking him what the assets of his business were in 1992 is not justified. He hasn't laid any foundation for the necessity of inquiring about assets. THE COURT: Nor has he requested any income tax returns, I assume. Maybe he has. MR. OSTROWSKI: Well, yes, I actually did. MR. KITCHEN: And gotten them. THE COURT: So on those, prior to the incorporation, you have Mr. Graham and you have a Schedule C there showing the business. MR. OSTROWSKI: I don't know, Your Honor. I mean, Mr. Kitchen must have thought I was up to something. I was just asking a simple question. Let me withdraw the question. BY MR. OSTROWSKI: Q. Did you transfer all of your business assets to the corporation? Your customer lists, your stock, the machinery? A. Yes. Q. Basically one day it was you, and then the next day it was the corporation, with the same -- A. Well, that's what my accountant said. She said, you take a hundred shares, everything goes there. Q. Well, what I'm saying is, are you using the same equipment under the corporation as you did? A. Basically, yes. Q. I mean, you may have bought some new stuff? A. Right. Q. You used the same customer lists and business information in your files? THE COURT: Is this a Subchapter S corporation? THE WITNESS: Yes, sir. BY MR. OSTROWSKI: Q. Okay. Now, in the -- do you know what your gross profit was in the 12 months ending July 31st, 1993? THE COURT: '90 -- MR. OSTROWSKI: '93. THE WITNESS: Not off the top of my head, no. THE COURT: "Your" being the corporation. THE WITNESS: Yeah. BY MR. OSTROWSKI: Q. Defendant's Exhibit 10 at the top, does that refresh your recollection? A. Okay. THE COURT: I didn't get the period for which, which 10 covers. For the fiscal year -- THE WITNESS: For a 12 month period ending July 20 -- or, July 31st, '93, $423,276.40. BY MR. OSTROWSKI: Q. What is that, sales? A. That's sales. Q. And is the total revenue figure the same? A. Total revenue the same. Q. And is the gross profit figure the same? A. Gross profit the same. Q. What, in that period of time, 12 months ending, I take it this is a fiscal year or something like that, the 12 months ending July -- A. Right. That would end, that's the ending of that year for the corporation. We're in the second year now. Q. In the 12 months ending July 31st, '93, did you receive an officer's salary? A. Yes, I did. Q. And what was that? A. $140,050. Q. Now, these, the sales figure, that $423,276.40, that's, those are sales of CD ROM disks? A. Which figure? Q. The top figure that you stated previously? A. This, that would be total sales, yes. Q. Of CD ROM disks? A. CD ROM disks, yes. Q. With file retrieval programs on them? A. Could have been -- I'm sorry, could have been CD ROM drives, too. Q. Okay. And what, do you have any figures on how much, how many -- how much income was derived from selling CD ROM drives? A. Probably 95% of that. Q. 95%? A. Yes. Q. You don't have any figures on that though? A. No, I don't. If that's the right quote, I'm not sure. Q. Pardon me? A. That might be the whole, that might be all CD ROM's. I could tell better by looking at it. Q. If you want to look at it. A. Yeah. I could tell better by looking at it. Q. Have you been able to find anything you're looking for? A. No. Because she's got it all under merchandise. She has not broken it up. I couldn't tell you the -- I mean, they all could be CD ROM's. Q. Just a few minutes ago I asked you what the business did and you said, selling CD ROM's, didn't you? A. Yes. Q. Okay. And now you're saying that 95% of the business is selling CD ROM drives? A. No. We sell some drives. I said maybe 5%. THE COURT: I thought you said 95%. THE WITNESS: Well, I said maybe 95% of that but, with that figure being that high, no, that would have been incorrect. THE COURT: So what would the percentage be? THE WITNESS: I'd say if we sell eight or nine CD ROM drives a year, but then you'd have to figure out the percentage. THE COURT: What dollar aggregate? THE WITNESS: Pardon? THE COURT: What dollar aggregate in 9 or 10? THE WITNESS: About, you're talking $200 a drive, $179 a drive, so you take, you're talking about $1,600 off that figure, so my percentage is -- MR. OSTROWSKI: Oh, okay. I misunderstood you completely. THE WITNESS: No. BY MR. OSTROWSKI: Q. So you're saying that out of the $423,000 roughly revenue- - A. $600 -- $1,600 is, right. Q. So you take off about $1,600 of that for your -- A. Drive. Q. -- secondary business of selling these hard drives? A. Right. Q. Which is, by the way, what, a hard drive? A. The CD ROM drive. Q. What allows the CD ROM to be used in the courtroom, the thing you throw the CD ROM into? A. Right. Correct. Q. Okay. Now, do you have any -- do you know what your income was, either as a d/b/a or as the corporation in the year prior to that, which I guess would be the 12 months prior to July 31st, '92? In other words, I guess I'll be off on a month, but something like July 1st or whatever, '91, to July 31st, however that works out, that one year period, '92? A. The year of '92 it would have been split two ways because it would have been half corporation and half Night Owl's. Whenever Night Owl's shut down, the corporation took over, so I couldn't -- THE COURT: Well, I know, but when you are operating as, under that business name you're on a calendar year. THE WITNESS: Yes. THE COURT: There came a point when you incorporated the corporation and it went on a fiscal year ending July 31. So really that's the point. You had a half year or seven months of the calendar year before you shifted into the corporate business. THE WITNESS: Right. THE COURT: Then of course it had its 12 months fiscal year. THE WITNESS: I'm not sure what -- THE COURT: What what? THE WITNESS: -- what the figure was, what we grossed then. BY MR. OSTROWSKI: Q. Well, do you have any idea what your income was, either as an individual or a corporation for that fiscal year prior to '92-'93? A. No, I don't. Q. Was it roughly the same as '92-'93? A. No. It was -- Q. Less or more? A. -- less. Q. How much less? A. I really don't know the figures. I'd say very low, lower than that. MR. OSTROWSKI: I just need a moment, Your Honor, because I'm going from income statements to tax returns and it's a little -- THE COURT: All right. Recess. MR. OSTROWSKI: Thank you, Your Honor. (Recess taken.) BY MR. OSTROWSKI: Q. Now, what is the status, the figure you gave is, the figure $423,000 and change, that goes until July 31st, '93 which leaves out August '93 to October 13th, '93. Would your figures of gross revenue and, well, that figure, would that be comparable in these last few months to the figure that, for fiscal year '92-'93? A. No. Q. Okay. A. You're saying $400,000 and some odd thousand dollars for two months? Q. No, no, no. Well, I got a calculator here. A. Oh, you mean split the $420,000 something by 12? Q. Well, let me just -- would you agree that $423,000 and change divided by 12 is about $35,000? You want to -- A. No. That's correct. I could figure it out. Q. Well, why don't you do it because I may have made a mistake. MR. KITCHEN: Well, Your Honor, it is what it is. I mean, we'll stipulate to that. It's a mathematical formula. MR. OSTROWSKI: But I'm just double checking. THE COURT: Well, I divided 423 by 12 and got 35.25. THE WITNESS: 35.273. THE COURT: 35.25? THE WITNESS: 35.273 BY MR. OSTROWSKI: Q. Okay. And that's, that was your monthly income for -- well, let me say gross revenue, total revenue for fiscal year '92-'93, per month, on average? A. Average, yeah. Q. Okay. And what is it in the last several months, since then? Comparable? Is it about the same? A. No. Q. Okay. And how is it different? THE COURT: Up or down? THE WITNESS: Down. BY MR. OSTROWSKI: Q. Okay. And how much down? A. The last two months considerably, way down. This month it's up. This is the type of the year. Q. Well, what is your gross revenue for, say September, if you know? A. I don't know. I know it was down. I know that. I know it's no where near that, I figure. Q. Okay. Now, in 19 -- before you incorporated, did you file Schedule C Profit and Loss Statements? Well, maybe I'm -- THE COURT: You filed your own income tax returns? THE WITNESS: No, I did not. MR. OSTROWSKI: Okay. THE COURT: Well, somebody -- THE WITNESS: My accountant, yes. THE COURT: Yes. For you. You signed them. THE WITNESS: Yes. THE COURT: Was there a Schedule C? THE WITNESS: Yes, sir. THE COURT: All right. BY MR. OSTROWSKI: Q. Do you recall what your Schedule C gross sales figure was for 1991? A. No, I would not. Q. Okay. Showing you Defendant's 11, is that your 1991 tax return? A. Yes, it is. Q. Who's Anna? A. My wife. Q. Okay. Joint return? A. Joint return. Q. Now, is there a Profit and Loss -- A. Yes, there is. Q. -- from a business form? A. Yes. Q. Schedule C? A. Yes. Q. And does that have a figure for the gross -- THE COURT: Excuse me. What calendar year is that? MR. OSTROWSKI: 1991. BY MR. OSTROWSKI: Q. Were you on the calendar year, by the way? Do you know what I'm saying? THE COURT: Has to be. A person has to be. THE WITNESS: January -- yes. MR. OSTROWSKI: Okay. I guess I was confused by the business. BY MR. OSTROWSKI: Q. Okay. So this is for the calendar year 1991. Is there a figure for gross sales on this? A. Gross sales, yes. Q. And what is that? A. $63,439.77. Q. $63,439.00 and change? A. Right. Q. And what was the -- did you list a d/b/a on that profit and loss statement? A. Yes, she did. Q. On line C, what does that say? A. She misspelled it N-I-T-E, Nite Owl Computer Service. Q. Okay. Now, when did you get into the CD ROM field, was it with C.A.R.R.S. 2? A. Back when I worked for Kenny Helinski, right, in September of '90. Q. And that, the first release was Plaintiff's Exhibit 1, PDSI-001? A. Yes, that was the first release. Q. Did that derive, was there much revenue generated from that? A. I have no idea. Q. Didn't that -- that did not go to you? A. What do you mean, the money? Q. The revenue? A. No, it did not. Q. Okay. What about Plaintiff's Exhibit 37, PDSI-002? A. That, not all the revenue went to us either. Not all of it. When I took it back from them, yes. Q. Who's them? A. When I took it back from C.A.R.R.S., then I started to turn a revenue, yes. Q. You say you took it from C.A.R.R.S.? A. That's correct. Q. What did you take? A. I took my programs and my retrieval from them, yes. Q. Okay. This is Jeff Anderson's retrieval, right? A. Mine and Jeff's, yes. Q. Okay. What I'm asking you, what I'm concerned about here is, when, this Plaintiff's Exhibit 37, when was that released? A. October, October of '90. Q. Okay. And did it derive -- were there many sales of that product that went to your benefit financially, because you said it was split up somehow? A. Not in October, no. Q. Okay. When -- well, I'm saying, ever? A. Starting in November, yes, there was profits made on the disk. Q. November 1990? A. 1990. Q. And when would the sales of that have dropped off a bit? I assume that they did. A. Probably about two months. It usually lasts two, three months. It really depends. Q. Well, you've testified about 1991. You've testified about fiscal year '92-'93. Tell us about that first five or six months of '92, as far as your gross sales of CD ROM's. How does that relate to the -- the prior year you had gross sales of $63,000 and change, and then '92-'93, there was a large increase, is that correct, in gross sales? A. From when? Q. Well, $63,000 in 1991 and change is your gross sales from Night Owl's? A. 1991, a whole year, yes. Q. And that's, that's about $5,000 a month, roughly? A. Roughly, yes. Q. Okay. And then you went way up to, what was the figure we came up with, $35,000 or so? A. $35,000. Q. But then there's that six month or five month gap between, in other words, January 1992, February, March, April, May? THE COURT: Seven months. Well, the fiscal year is July 31. MR. OSTROWSKI: That stuff I can't keep straight. Six or seven months from -- THE COURT: They have an odd system. The months of the year are sometimes 1, 2, 3, 4, 5, 6, 7. July is 7, so it's the seventh month. THE WITNESS: You mean January '92 to August of -- BY MR. OSTROWSKI: Q. January '92 -- A. -- to August '92. Q. Well, when does the fiscal year -- A. August of 1992. MR. OSTROWSKI: Perhaps Your Honor could answer. THE WITNESS: August of 1992 started. THE COURT: Commencing August 1. THE WITNESS: August 1. BY MR. OSTROWSKI: Q. Oh, August 1. A. Right, 1992. Q. Okay. So for the first seven -- what I'm asking you is, for the -- we don't have -- I haven't received any -- A. I gave you all of them. Q. I don't have anything that, to me that indicates -- A. I hope you do because -- Q. -- what happened in that seven month period. A. I gave you a report on all -- THE COURT: Do you have a personal income tax for that calendar year? MR. OSTROWSKI: What I have, Your Honor, is a '91 personal, '92 corporate, which has the same figures as the income statement, but that's fiscal year. THE WITNESS: We also -- MR. OSTROWSKI: And then I have two income statements which essentially overlap, and I'm disregarding one because -- THE COURT: Well, what did overlap would be Schedule C on his and his wife's personal income tax for that year, for seven months, and then you'd have the whole fiscal year for the corporation. MR. OSTROWSKI: I don't think I have personal for '92. THE WITNESS: I could check. I thought I turned them all in. MR. OSTROWSKI: Now, there is a little bit of gap in the records. THE COURT: Pardon me? MR. OSTROWSKI: There is a gap in the records. That's why I'm trying to fill that. Perhaps I could be supplied the continuation and that would make it even easier. THE WITNESS: You looking for the '92 return? THE COURT: Wait a minute. If you want to consult with your attorney, you may. MR. OSTROWSKI: We do have a gap. I mean, I'd ask that there be some search made. We're just talking about the seven month period. Perhaps the '92 individual with a Schedule C is all we need. MR. KITCHEN: Well, Your Honor, I don't have '92 personal, which might answer the question. I don't know, unless Mr. Graham has it in his -- THE WITNESS: I know it - - up here. MR. KITCHEN: -- in his valise. MR. OSTROWSKI: Well, do you know -- THE WITNESS: Well, no. I better not make a -- MR. KITCHEN: Well, don't guess. THE WITNESS: I don't know if I've got it home or not. I'm not sure. BY MR. OSTROWSKI: Q. Well, let me ask you this. Would the Schedule C in your 1992 return be an accurate statement of your gross profits from that business? A. From the, the $426,000 one? Q. No, no, no. That's separate. Your '92, did you file a '92 Schedule C? A. Yes. Q. As a d/b/a? A. Yes. Q. And whatever figure is on there, would that be an accurate figure, since it's a tax form? A. Oh, yes. Q. Okay. MR. OSTROWSKI: Perhaps if we could just, we could stipulate that the figure is what it is, once we get the document. MR. KITCHEN: We'll provide it. MR. OSTROWSKI: Okay. Then I don't have to get into speculation about how things went. BY MR. OSTROWSKI: Q. Now, Chuck Morgan testified for you, did he not? A. Yes, he did. Q. And you paid him a fair amount of money recently, over the last year or two? A. I don't know how much he got paid, but he does work for us, yes. Q. And do you have any idea how much you paid him, say in the last year? A. No, I don't. THE COURT: Excuse me. Paid whom? MR. OSTROWSKI: Chuck Morgan, Your Honor. THE COURT: Who is Morgan? MR. OSTROWSKI: He was a witness for Mr. Graham and business associate. BY MR. OSTROWSKI: Q. Is it fair to say that you paid him about $2,800? A. That could be. Q. Based on your '92-'93 income statement. Looking at page 18 of Exhibit, Defendant's Exhibit 10, does that refresh your recollection about how much you might have paid him? Is it about $2,800? A. I'd say quite a bit more. Q. Okay. A. Quite a bit more. Q. How much, roughly? A. Maybe $25,000, $28,000. It's Computer Concepts, to Custom Computer Concepts, and Chuck Morgan. Q. Okay. He's got a d/b/a? A. Yes. Q. So how much -- A. There's quite a few there. Q. It's a lot more than $3,000 then? About $5,000 roughly? A. No, no. About $3,000. Q. $4,000? A. Roughly about $3,000. Q. Did you -- strike that. THE COURT: No, it never gets stricken. MR. OSTROWSKI: It's another metaphysical request. BY MR. OSTROWSKI: Q. Now, when did, when did your gross income with, start to pick up with respect to CD ROM releases? THE COURT: CD ROM what? MR. OSTROWSKI: CD ROM releases. BY MR. OSTROWSKI: Q. And I'll show you the Exhibits if you need to look at them? A. Probably around version 7. THE COURT: Of what? THE WITNESS: Version 7, NOPV-7. THE COURT: Version 7. THE WITNESS: Yes, sir. BY MR. OSTROWSKI: Q. And when did that come out? A. NOPV-7, to my recollection, probably late of '92. Q. And whose file retrieval is on version 7? A. Brian's. Q. Would that be Plaintiff's 20? Do you know it now by heart or, I think it might be laying up there. A. Yeah. This is 20. Yes, this would be it. Q. Okay. And which CD ROM has Swanson's program, Plaintiff's 21 on it, or which several CD ROM's? A. 9 and 8. Well, 9 and 8 is actually Swanson's and -- well, no, let me correct that. 8 is Swanson and Brian's, and 9 is all Swanson's, and Brian's, a little bit of Brian's in there yet. Q. Okay. NOPV-8 -- well, are you saying that Plaintiff's 21, the program, is part Brian's and Swanson's? A. Yes, that's correct. Q. Okay. And so Plaintiff's 21 is the file retrieval on NOPV-8 and 9? A. Not quite. There was another code previous to this, in between this. See, they update every -- every disk we put out we updated the retrieval, so -- Q. I'm just asking you about, what is Plaintiff's 21 on, which disks? A. 21 is on -- 21 is on 9. THE COURT: Not on 35? THE WITNESS: What's 35? THE COURT: Micro floppy disk, 3-1/2 inches for Plaintiff 21. MR. OSTROWSKI: Yes. That's just the program in another format. In other words, I'd be asking him if, what is 35 on also. What CD ROM is 35 on. MR. KITCHEN: I think when the witness said 9, he meant NOPV-9. THE WITNESS: NOPV-9, yes. THE COURT: Yeah. 009. MR. OSTROWSKI: Okay. Yeah. BY MR. OSTROWSKI: Q. So 21 is on NOVP-9? A. Yes. Q. And what is on NOVP-8? A. A little, almost all of 20 and maybe 20-1/2. There was no, otherwise it's in between here and here. Q. Okay. And 20 is NOVP-7? A. Yes. 20 is NOPV-7, correct. Q. Okay. And what, is there an NOPV -- A. 6, yes. Q. -- 6? A. That's also 20. Q. And -- COURT RECORDER: Are you saying V-P? MR. OSTROWSKI: NOPV. THE COURT: N-O, Peter Victor. BY MR. OSTROWSKI: Q. And what about, is there an NOPV-5? A. Yes, sir. Q. I probably should be doing this in the other order. A. No -- I'm sorry. That's PDSI. Q. Okay. At that point it becomes PDSI? A. Yes. Working backwards. Q. And what number, 6? A. That would be -- Q. There's a 6, isn't there? A. It's neither one of these codes. So it would have to be - - Q. 8? THE COURT: Plaintiff 8? THE WITNESS: I'm not sure until I see it. THE COURT: I'm just suggesting that for counsel. I have that marked as -- THE WITNESS: It's Larry James' code, if that helps you. THE COURT: -- Night Owl's PDSI-005, CD ROM, 10/3/91. BY MR. OSTROWSKI: Q. Okay. Is it fair to say that all of your CD ROM releases after C.A.R.R.S. 2 and before NOPV-6 involved the code that Larry wrote for you? A. No. Q. Okay. Except for Folio? A. Right. Q. Okay. And offhand, do you know which one that was? We've got it here somewhere. A. 3. PDSI-003. Q. Okay. You've already testified about that. Now, there's no -- is there a C.A.R.R.S. 3 or a PDSI-3? THE COURT: Let me just interrupt here. I find one reference to a PDSI-006 and then I have an NOPV-006. THE WITNESS: Yes, sir. The PDSI-006 was recalled. THE COURT: I see. BY MR. OSTROWSKI: Q. Okay. So, now, do you have any -- did you receive a request to produce sales figures for each of the CD ROM drives? A. For the CD ROM disk? Q. Yeah. Each of the releases? A. No, I have not. Q. Your lawyer didn't ask you to produce those? A. No, he has not. Q. Okay. Do you have, do you have any way of allocating gross revenue figures to each release? A. Oh, you mean how many disks I sold of that product. Q. Well, we're talking about revenue here. We've -- you testified about that. I'm just wondering if you can allocate revenue according to each release, even approximately? A. I think I could. Q. Okay. And starting with -- A. I mean, not now. I'd have to figure out, you know, take some time. I couldn't do it in my head because the figures vary, who you sell the product to. You sell it retail or you sell it wholesale. Q. Well, can you give me the periods during which the releases were actively being sold? Say -- THE COURT: You mean each particular one? MR. OSTROWSKI: I think I need it. THE COURT: Well, I'm asking you if that's what you want. MR. OSTROWSKI: Yes. THE COURT: Are you able to do that? THE WITNESS: No, sir, I am not. BY MR. OSTROWSKI: Q. Are you able to give us a rough idea of the release dates of each of the CD ROM's? A. A couple -- Q. Starting with PDSI -- A. I can do 5. THE COURT: PDSI -- excuse me, PDSI -- MR. OSTROWSKI: Is PDSI-3 the one with Folio? THE WITNESS: No. I only know roughly on that. THE COURT: I have some record earlier about December 6, 1990. Does that seem appropriate? THE WITNESS: That could be close, sir. BY MR. OSTROWSKI: Q. For which release? A. For 3, the Folio. Q. Okay. What I'm really concerned about is, starting with the -- A. I know 4. Q. I still don't know how to open these. There's a PDSI-003- 1 that says Folio on it? A. Right. That was a recut of the 3, and that was about a couple weeks to a month after. THE COURT: A couple weeks what? THE WITNESS: A couple weeks to a month right after we cut the first one. BY MR. OSTROWSKI: Q. Well, do you know when PDSI-004-1 came out? Maybe I'm not going in perfect order but -- A. It came out after April of '91. I'm not sure because I know of the -- the blue one, 4, came out April 23rd of '91. Q. Well, I'm not clear, -1 came out when? A. -1 came out April, May, May or June. Q. It says '90 on it. A. May or June of '91, not of '90. Q. Okay. The copyright, okay. A. Right. Q. This came out in May, about May of '91? A. I'd say May or June of '90. Q. Okay. And how long does -- THE COURT: '90 or '91? THE WITNESS: '91. BY MR. OSTROWSKI: Q. What is the life expectancy of a CD ROM in terms of generating sales that are -- five months, two months, a year? A. It really depends on how many disks are coming out on the market. It's usually fairly good to say three months to four months. Q. Okay. PDSI-004, when did that come out? A. That came out in April of '91. THE COURT: 4 or 4-1? MR. OSTROWSKI: 4, without -- just 4. THE COURT: Yeah. I know. He had testified earlier that 4-1 came out in May or June, and now you're saying 4 came out in April? THE WITNESS: Yes, sir. BY MR. OSTROWSKI: Q. Okay. How about 004-2, PDSI? A. Not positive on that. See, they're updates. When they're slashes, that means it's been updated, there was a problem with the disk, so it could have been, the 4-1 come out in May and the 4-2 came out in May. I can't be absolutely positive. I'd have to look at the disk. Q. And as, as you sit there today, you don't have any records to indicate how much revenue each disk generated? A. No. I know how many disks sold, but not revenue. Q. Well, how many disks were sold? A. I have a piece of paper in my brief that I had called my account -- or, not my accountant, but Nimbus Manufacturing, and they gave me a count of disks that were sold. Q. How about PDSI-006-1, do you know when that came out? A. I'd say late '91, maybe December. Q. And how about PDSI-005? A. Oh, what was the one before that? Q. Yeah. I'm not, I'm trying to go in order but I can't. A. Well, then, you confused me. Which one, I thought it was 5, was after 4. Q. Oh, I'm sorry. No. I just was grabbing what I could grab. A. 5 was late of '91. THE COURT: Was when? THE WITNESS: 5 is late of '91, I think December of '91. THE COURT: Yeah. I had a date, 10/3/91, would that be approximate? THE WITNESS: Yes, sir. BY MR. OSTROWSKI: Q. Did I ask you about PDSI-006 yet? A. That would be early '92, January, February, somewhere in that area. Q. Well, you said that 6-1 was December '91. Wouldn't 6 have been before that? A. Which one? Q. I believe you said that -- A. Well, that's the one you got me confused on when you went out of line. You jumped from 4 to 6, I thought you were doing 5. So that one I have to do over again for a dating. Q. Okay. So 006-PDSI is what release date? A. Probably early of '92. Q. And do you want to change the release date of 006-1-PDSI? A. Right. That could be a month or two after that. Q. So spring of '92? A. Well, it could be, if 6 was out in say January, February, March, 6-1 could have came out. It was an update. THE COURT: When would it have come out? 6-1. THE WITNESS: Probably four to six weeks later. But them disks are recalled anyway. THE COURT: About the summer of '91? THE WITNESS: Yes, sir -- no, '92. THE COURT: Oh, '92, that's right. BY MR. OSTROWSKI: Q. Okay. Now, then you move into NOPV, right? A. Yes, sir. Q. And that goes from 6 through 9, that you've testified about? A. Yes. Q. Okay. When did 6 come out? A. I think 6 came right around July. THE COURT: '92? THE WITNESS: '92. BY MR. OSTROWSKI: Q. And 7? A. August '92. Q. And 8? A. I still think I have some of them dates mixed up because I know that 8, 8 was cut in '93. Q. Well, I'm sorry. A. 7 was cut late of '92, I think. 8 I think was around June or July of '93. Q. Okay. 8 is, you say June '93? A. I think. June or July. Q. And what about 9, the release date? A. I think this was 4, April of '93. I'm not sure. Q. You don't have 9 in front of you, do you? A. January, February, March -- this is March of '93, this is April of '93. Q. Which though? You've got to tell me, Exhibit number? A. Oh, I'm sorry. NOPV-6 would be March of '93. NOPV-8 was, I think April of '93. Q. I'm sorry. I didn't hear what you just said. THE COURT: He said April '93 for 007. THE WITNESS: No, sir. 008. NOPV-008. THE COURT: 008. I see. BY MR. OSTROWSKI: Q. I'm sorry. I've been talking to Mr. Kitchen about a dropped Exhibit, that I dropped. What is the last statement you're making, as to which disk? A. This particular disk right here was published in April of '93. Q. What's the number? A. NOPV-8. Q. So that's April '93? A. Yes. Q. 6 is March '93? A. 6 was March of '93, right. Q. 7 is what? A. It would have been between them two. Q. Not sure? A. No, I'm not. Q. And 9 is what release date? A. 9 was just published. Oh, no. I'm sorry. 9 was not just published. It was three months ago. Backwards. Q. Knowing how bad I am in math, can you tell me what month? September, August, July? A. July, July 4th. Q. Do you know how much money you might have paid Ralph Marquardt over the last two, three years? A. I have no idea. Q. Can you estimate? A. Estimate, maybe a couple hundred dollars. Q. Let me just ask you, with respect to PDSI-004 and 5, 6 and, 5 and 6, is there anything original in those programs, other than the organization of the screen as it appears to the user? A. Yes. Q. Okay. What? A. The directories. The directories. Q. Well, the directories aren't in the file retrieval program, are they? A. Yes, they are. Q. They are? A. They are. Q. Okay. What do you mean by the directories, the categories of information? A. No. I'm talking about the DOS directories, the 00 structure, and I'm talking about the file header and the location of file in the header itself, in the file, inside the retrieval. Them are my compositions. Q. Those are not actually in the file retrieval programs themselves, are they? A. Yes, sir, they are, in all three of them. Q. They are? A. They are. Q. The information that you see on the screen when we open up the CD ROM, communications, education, and so on, how actually did that, how did that information get there? A. It gets there from the header. Q. Well, I take it at some point somebody typed in communications somewhere. I'm going back, say, we're going back to 1989 to the present. A. Right. Q. From some point from 1989 to 1993, somebody typed in communications? A. Yes. Q. And who did that? A. I did. Q. And what kind of a file did you type that into? A. I typed that into a CAT file. THE COURT: Into a what file? THE WITNESS: A CAT. THE COURT: C-A-T? THE WITNESS: C-A-T. Dot C-A-T. There's an extension in front of it. BY MR. OSTROWSKI: Q. Is that a word processing document? A. No, it's a D-I-R. Q. What do you mean by D-I-R? A. It's a directory. It's a directory listing, just the same way as a D-I-R is. Q. Okay. And that, that D-I-R listing that, the information that you type in the various categories, that doesn't make the, that doesn't allow the CD ROM, that doesn't allow the user to access information on a CD ROM, does it? A. Yes, it does. Q. It does? A. Yes, sir, it does. Q. Typing in the word communication? A. No. It's already in that DIR. That's how the retrieval finds which directory it is and where it's located at. Q. Okay. The retrieval finds the screen information and brings it to the screen, right? A. No. You put it to the screen. You pick the directory you want to go to. Q. Well, when you type in Night? A. Right. Q. Execute? A. Right. Q. The Night command and press enter? A. Right. Q. Is it true, fair to say that the file retrieval program, Plaintiff's 18, 19, 20, 21, whatever? A. Right. Q. Goes out and gets that document, that CAT document, and brings it to the screen? A. Brings it to the screen through that DIR. It finds it through the top of that header and that locator. Q. Okay. So the -- A. It puts it on the top line -- Q. The file retrieval program sends it -- A. The file retrieval -- Q. -- extracts the screen data that you typed in -- A. No. Q. Well, what? I didn't finish my question. What? You said no. What? A. He pulls -- THE COURT: He hadn't said anything, and you haven't finished your question. BY MR. OSTROWSKI: Q. Okay. The file retrieval program seeks out the CAT document, right, what you call CAT? A. Yes. Q. Is that C-A-T? A. Well, it could be D-I-R 1, if you want to use that for an easier -- Q. And in that document, you have various categories listed, with numbers? A. Yes, sir. Q. And -- A. No, no. Q. No? A. Files, name of files, size of files, dates of files, and what the description of that file is, but the top line is the name of that directory and the location on that CD ROM where that file is located at. That's what the retrieval looks at to put up the communication name and to find that directory on their own. Q. Okay. And that file, and that information, and that power that it has is not in the file retrieval system itself? A. It's on my file, right. Q. Right. A. Right. Q. Okay. And it's not, none of that screen data and all those functions that you talked about are in any of these Plaintiff Exhibits, 18, 19, 21, really any, they're not in any of the file retrieval programs, are they? A. The header and locator is in all of them. Q. But the screen data, the communications, education, and so on, and the set-up, that's not in the file retrieval program itself, is it? A. Oh, it's on the front screen menu, yes. It's on the DIR. The main DIR. But that main DIR is not what controls where that files goes. Q. Well, isn't there something in the file retrieval program that calls up this data from someplace to the screen? A. When he first fires Night up, and he comes up, he pulls up a DIR. That is the menu. Q. And the DIR is not in here, say Plaintiff's 21. Plaintiff's 21 goes and gets the DIR? A. Right. Q. And puts it on the screen? A. Right. Q. Okay. A. It's not in the retrieval itself. Q. So the arrangement of the screen that's been testified to, is not in Plaintiff's 21 or Plaintiff's 20 or any of the other file retrieval -- A. It's not in any of them, no. Q. Okay. MR. OSTROWSKI: I'd just like to, based on that testimony, renew my motions that there's no, they're not claiming any protectable material in the file retrieval programs. Therefore, the preliminary injunction should be lifted and also the confidentiality order. And I have no further questions. THE COURT: Do you have questions, Mr. Kitchen? MR. KITCHEN: I have several questions but if, since Mr. Ostrowski has just made another motion -- THE COURT: Well, which you're going to respond to. He renewed something to which you haven't yet responded, and you're going to respond to it. MR. KITCHEN: Yes, sir. All right. THE COURT: We'll just leave it there. Poised. Hanging. MR. KITCHEN: Well, in other words, you don't want me to respond to it now. THE COURT: I want you to file something. MR. OSTROWSKI: The reason I'm making these -- THE COURT: He has filed a paper and I'd like to have a paper in response. MR. KITCHEN: Well, yes, but his paper now has been supplemented by these little, these little extra zingers, say. THE COURT: Then you have the advantage. You can in writing respond to what he has in writing, and also what he's shingled off the roof with. MR. OSTROWSKI: Your Honor, the reason I make these oral motions is that there's an urgency in the matter, and that's why I keep renewing them. I don't believe I'm required to move on paper during a trial, although Federal -- THE COURT: I haven't asked that you do move on papers. I'm just saying, you moved on papers. You've sent them in, and I want something on papers from Denis, and we'll do it quickly and get it resolved. REDIRECT EXAMINATION BY MR. KITCHEN: Q. Mr. Graham, this, the category of this program that all this litigation is about is a file retrieval program, correct? A. That's correct. Q. And the purpose of the program is to do what? A. To retrieve the DIR files. Q. Okay. If, if you put the program in the computer but you have no files to retrieve, what will the file retrieval program do? A. Nothing. Q. Okay. So, is it a little like a machine that handles products, like a conveyor belt or a shovel or a truck? A. It needs to be fed them DIR's. Q. All right. And if we have nothing to feed it, we can't really see how it works? A. No. Q. But that doesn't mean it doesn't work MR. OSTROWSKI: Objection to the leading. THE COURT: Yeah. Don't lead the witness. Let him testify. MR. KITCHEN: Your Honor, I'd like at this time to offer all of the Exhibits. THE COURT: Which are? MR. KITCHEN: Well, my understanding is we have Exhibits 1 through 15. THE COURT: Plaintiff's? MR. KITCHEN: Plaintiff's Exhibits I'm referring to, Your Honor, and I'm not sure -- THE COURT: You're offering those? Plaintiff 1 through -- MR. KITCHEN: Well -- THE COURT: Plaintiff 1 through 12 are in evidence. (Plaintiff Exhibits 1 through 12 were received in evidence.) MR. KITCHEN: All right, Your Honor, then, okay. I'm offering 13, 14 and 15 then. Those are all the copyright forms. MR. OSTROWSKI: I have no objection to the copyright forms. THE COURT: All right. Plaintiff 13, 14 and 15 are received in evidence. (Plaintiff Exhibits 13, 14 and 15 were received in evidence.) MR. KITCHEN: Yes, I have 13, 14 and 15. Actually, I believe I've got 1 through 12 as well. THE COURT: They're in evidence. MR. KITCHEN: They're scattered about, but -- THE COURT: They're in evidence already. MR. KITCHEN: I would also offer 18, 19, 20 and 21, those being the printouts of source code which I would offer into evidence with the -- THE COURT: 21 has already been received. MR. KITCHEN: Okay. -- with the reservation, Your Honor, that the, that, of course, they continue to be under the protection of the disclosure order. MR. OSTROWSKI: I have no objection to it being received in evidence, to them being received in evidence. THE COURT: Plaintiff 18, Plaintiff 19, Plaintiff 20 received. (Plaintiff Exhibits 18, 19 and 20 were received into evidence.) MR. KITCHEN: And then I have, 22 and 23 were two 3- 1/2 inch disks. THE COURT: 22 has been received. MR. KITCHEN: Okay. Any objection to 23? MR. OSTROWSKI: No. MR. KITCHEN: Okay. THE COURT: 23, no objection? MR. OSTROWSKI: No objection. THE COURT: 23 received. (Plaintiff Exhibit 23 was received into evidence.) MR. KITCHEN: 24 through 27 were four more CD's. MR. OSTROWSKI: No objection. THE COURT: 24, and there's a 24-A, 25, 26, 27. MR. KITCHEN: Okay. The, 32 -- THE COURT: Wait a minute, what about 24-A? MR. KITCHEN: Oh, I'm sorry. 24-A, oh, that was a yellow slip that was in the 24 box. THE COURT: All right. So -- MR. KITCHEN: And 25-A would be a similar -- THE COURT: 25-A was not noted at all. MR. KITCHEN: Okay. There is a 25-A, Your Honor. At least it has been labelled as such, and it is a slip -- THE COURT: What is it? MR. KITCHEN: It is a yellow piece of paper that is slipped into the box with 25. THE COURT: That's a yellow slip from the, I had that 24-A was a yellow slip from the case. MR. KITCHEN: That was in the case 24, and 25-A is a yellow slip in the case of 25. THE COURT: Does your lack of objection include 24-A, 25-A? MR. OSTROWSKI: Yes, Your Honor. THE COURT: All right. Those six are received. (Plaintiff Exhibits 24, 24-A, 25, 25-A, 26 and 27 were received into evidence.) MR. KITCHEN: Then we have 32, which is, as I understand, is PDSI-004-2 and -- THE COURT: Excuse me. What was that? MR. KITCHEN: PDSI-004-2. THE COURT: Plaintiff 32? MR. KITCHEN: Yes, sir. MR. OSTROWSKI: No objection. THE COURT: All right. Somehow that, I don't know, I have that tying in with also Plaintiff 20 -- 40 rather. MR. KITCHEN: Yes. That would be correct, Your Honor. Plaintiff -- THE COURT: Which also ties in with Plaintiff 45 and 43, which, of course, are source codes? MR. KITCHEN: Yes, Your Honor. The tie-in is the fact that -- as a matter of fact, 40 is identical to 32. They are both a copy of PDSI-004-2 and 40 was the one that was given to Professor Brown and he identified that. THE COURT: All right. 32 is offered? MR. KITCHEN: Yes. MR. OSTROWSKI: No objection. MR. KITCHEN: Okay. THE COURT: It's received. (Plaintiff Exhibit 32 was received into evidence.) MR. KITCHEN: 33 I believe is already -- THE COURT: It has been received. MR. KITCHEN: Okay. 34, 35 -- THE COURT: I don't have anything for 34. MR. KITCHEN: Oh. I have 34 as Night Owl's PDSI-006, CD ROM, and that apparently is also identical to number 25. THE COURT: 25 is, 25 I have as an NOPV-006, not a PDSI. MR. KITCHEN: That's correct, Your Honor. That is an NOPV-006. This was a -- THE COURT: And that's in evidence. MR. KITCHEN: Yes. And this was a PDSI-006, which should have been noted as such. And 36 -- THE COURT: Wait a minute. Let's cover 34. MR. KITCHEN: Okay. I would offer -- THE COURT: Wait a minute. You offer 34? MR. KITCHEN: I would offer 34. MR. OSTROWSKI: No objection. THE COURT: 34 is received. (Plaintiff Exhibit 34 was received in evidence.) MR. KITCHEN: I would offer 36, which is Night Owl's NOPV-009. MR. OSTROWSKI: No objection. THE COURT: Plaintiff 36 received. (Plaintiff Exhibit 36 was received in evidence.) MR. KITCHEN: Then I would offer all four of the CD's which Professor Brown had, which would be Plaintiff's 37 through 40. MR. OSTROWSKI: No objection. THE COURT: All right. They're received. (Plaintiff Exhibits 37 through 40 were received into evidence.) MR. KITCHEN: Then Professor Brown's printouts, which were 41 through 47. THE COURT: 47? Is it 47 or 49? MR. KITCHEN: Well, 41 through 47 were essentially -- THE COURT: The ones he made. MR. KITCHEN: Yeah. Ones that he made that were really I guess screen dumps, or made from just simply running the CD ROM's. THE COURT: Yeah. MR. KITCHEN: And then in addition, 48 through 50, of which there was Professor Brown's copies of the source codes that he made comparisons. MR. OSTROWSKI: No objection. THE COURT: All right. Those 10 are received. (Plaintiff Exhibits 41 through 50 were received into evidence.) THE COURT: I assume you're not offering any Defendant Exhibits. MR. KITCHEN: Well, not -- as a matter of fact, I'm not sure there are any Defendant's Exhibits in evidence at the present time, or are they? I might be wrong on that, but -- THE COURT: Makes it a ripe field for offering if you choose to do so, but you don't, and you're right, there is none. That concludes your redirect of Mr. Graham? MR. KITCHEN: Well, no, it does not, Your Honor. THE COURT: Oh, I thought you said it did. MR. KITCHEN: No. I was, that was just one point I wanted to do, and I thought I would take care of that at this point, but I have a number of questions. THE COURT: How long? MR. KITCHEN: Probably half an hour, Your Honor. THE COURT: You'll have some recross? MR. OSTROWSKI: Yes. THE COURT: We'll do that in the morning, 9:00 o'clock. MR. KITCHEN: Do I understand the Court to say that we would go tomorrow and then also Friday morning? THE COURT: I have a small thing at 9:30 on Friday morning and then I can probably make myself available to you. I don't know what I have, see what my criminal calendar is. (Proceedings adjourned to October 14, 1993 at 9:00 a.m.) 895 I N D E X Witness Dir Cross Redir Recr Richard E. Graham 928 1050 Exhibit Identification Evidence Plaintiff 1-12 1051 13-15 1051 18-20 1052 23 1053 24-27 1054 32 1054 34 1055 36 1055 37-40 1056 41-50 1056