                                                                984
   1   UNITED STATES DISTRICT COURT
       SOUTHERN DISTRICT OF NEW YORK
   2   ------------------------------x
   3   UNIVERSAL CITY STUDIOS, INC.,
       et al,
   4                  Plaintiffs,
   5                  v.                           00 Civ. 277 (LAK)
   6   SHAWN C. REIMERDES, et al,
   7                  Defendants.
   8   ------------------------------x
   9                                           July 25, 2000
  10                                           9:00 a.m.
  11   Before:
  12                       HON. LEWIS A. KAPLAN,
  13                                           District Judge
  14                            APPEARANCES
  15   PROSKAUER, ROSE, L.L.P.
            Attorneys for Plaintiffs
  16   BY:  LEON P. GOLD
            CHARLES S. SIMS
  17        CARLA MILLER
            WILLIAM M. HART
  18        MICHAEL MERVIS
  19   FRANKFURT, GARBUS, KLEIN & SELZ
            Attorneys for Defendants
  20   BY:  MARTIN GARBUS
            ERNEST HERNSTADT
  21        DAVID ATLAS
            JEFFREY ROLLINGS
  22
  23
  24
  25
                                                               985
   1            (In open court)
   2            THE COURT:  Good morning.
   3            MR. ATLAS:  Before we begin with the testimony today,
   4   would it be possible to move in the exhibits and the
   5   deposition testimony, or would you rather do that before the
   6   break or whatever?
   7            THE COURT:  Let's not keep the witness waiting.
   8            MR. GARBUS:  Your Honor, can I just approach the
   9   bench a minute?  I hope the last bench approach.
  10            (At the sidebar)
  11            MR. GARBUS:  I just wanted to point out, because the
  12   comments on Thursday and Friday that I briefed at the reply on
  13   page 2, footnote 2, is whether one agrees or disagrees that
  14   plaintiff's conduct and the relief sought in the complaint
  15   also violates antitrust law and the first sale doctrine, as
  16   well as 1201(b)(3)'s prohibition against encryption technology
  17   that like CSS and home DVD players requires a particular
  18   design.
  19            Plaintiffs believe that the licensing regime and the
  20   DVD-CCA constructed permits them to dictate to members of the
  21   public who purchased their movies on DVDs (but not on VHS or
  22   VCD) as then purchased and approved CSS-licensed DVD players
  23   on which to view the movie.
  24            And then there's a quote.  It says:  Indeed, Fritz
  25   Attaway was the MPADC general counsel and many congressional
                                                                986
   1   lobbyists testified that "In order to obtain authorized access
   2   to a DVD, the consumer has to, in fact, make two purchases.
   3   He or she has to buy a DVD disk and also has to purchase a DVD
   4   display device."
   5            I just wanted to point that out that whether or not
   6   that's an issue in the case, we perceived it to be an issue,
   7   whether one agrees with it or disagrees with it or not.
   8            THE COURT:  Well, the Court doesn't perceive it to be
   9   an issue.  You never pleaded it.
  10            (In open court)
  11            THE COURT:  Mr. Cooper?
  12            MR. COOPER:  I have one issue with respect to the
  13   exclusion of witnesses.  My understanding is that we will hear
  14   from the defense today, five expert witnesses.  I would like
  15   to be able to have Mr. Schumann sit in on their testimony in
  16   order to aid us in preparing for potential rebuttal in the
  17   event that any of them testified to matters to which he might
  18   need to respond.  If there's no objection, I'd like him to
  19   attend that portion.
  20            THE COURT:  Is there any objection?
  21            MR. GARBUS:  No, your Honor.
  22            MR. COOPER:  Thank you, your Honor.
  23            THE COURT:  Your next witness, Mr. Garbus?
  24            MR. HERNSTADT:  Good morning, your Honor.
  25            THE COURT:  Mr. Hernstadt, I see where you spent the
                                                                987
   1   weekend.
   2            MR. HERNSTADT:  I'm sorry?
   3            THE COURT:  I see where you spent the weekend.
   4            MR. HERNSTADT:  For some reason everybody has noticed
   5   today.  The defendants call Chris DiBona.
   6    CHRIS DI BONA,
   7        called as a witness by the defendant,
   8        having been duly sworn, testified as follows:
   9            THE CLERK:  State your name for the record.
  10            THE WITNESS:  My name is Chris DiBona, D-I B-O-N-A.
  11            THE COURT:  You may proceed, Mr. Hernstadt.
  12            MR. HERNSTADT:  Thank you, your Honor.
  13   DIRECT EXAMINATION
  14   BY MR. HERNSTADT:
  15   Q.  Good morning, Mr. DiBona.
  16            Mr. DiBona, where do you live?
  17   A.  Well, Palo Alto, California.
  18   Q.  Can you describe your educational background?
  19   A.  Yeah.  Let's see now.  I went to school over at George
  20   Mason and studied computer science.
  21   Q.  When was that?
  22   A.  That probably was from about '91 until about '96.
  23   Q.  And what were the courses that you took in your computer
  24   science program?
  25   A.  You know, your basic broad-range of courses ranging from
                                                                988
   1   programming languages to database design, compiler design,
   2   system architecture, systems engineering, that sort of thing.
   3   Q.  And could you describe your employment history, please?
   4            THE COURT:  Well, did you graduate?
   5            THE WITNESS:  No, I have one class left, sir.
   6            THE COURT:  I'm sorry?  I couldn't understand your
   7   answer.
   8            THE WITNESS:  I have one class left.
   9            THE COURT:  And this is for a bachelor's degree?
  10            THE WITNESS:  Yes.
  11            THE COURT:  Go ahead.
  12   BY MR. HERNSTADT:
  13   Q.  Could you describe your employment history, please.
  14   A.  In chronological order or -- O.K.  I worked for the United
  15   States Department of State in their office of information
  16   management doing prototype software and doing dispute security
  17   work for them.  I then went to work for a law firm in
  18   Washington, where I administered an E-mail system.
  19            I worked -- came up to the -- I worked for Tandem,
  20   and I worked for Tandem and Smart Cards.  I started
  21   consulting.  Then I discovered VA Linux systems.
  22   Q.  When did you first start using Linux?
  23   A.  I first discovered Linux in late '94 as part of my
  24   computer science studies, at Sun Labs.  So, it was easier for
  25   me to install the Linux on the machine at home and do my
                                                                989
   1   homework there.
   2   Q.  And have you been using it as your system of choice for --
   3   since 1994?
   4   A.  Pretty much.
   5   Q.  Are you being paid by the defendants or DFF to be here
   6   today?
   7   A.  No, I'm not.
   8   Q.  What does VA Linux do?
   9   A.  VA Linux is a provider of systems software and
  10   professional services around the Linux operating system.  We
  11   sell, you know, computers for the infrastructure market.  We
  12   sell scientific computing clusters and a limited range of
  13   graphical work stations.
  14   Q.  Can you explain what those last two items are?
  15   A.  A scientific cluster is -- basically, it's a large
  16   collection of computers that are designed to attack a
  17   scientific problem, say weather or nuclear weapons
  18   simulations.  Those two are the common uses of those.  Instead
  19   of using one very, very large, very, very expensive system,
  20   you take a number of much smaller, much less expensive
  21   computers to attack the jobs, as far as --
  22            THE COURT:  Mr. DiBona, it's very difficult for me to
  23   understand.  Obviously the reporter is having a tough time,
  24   too.
  25            THE WITNESS:  Sorry, your Honor.
                                                                990
   1   Q.  Mr. DiBona, if you could perhaps talk a little more
   2   slowly, it might make it easier for everybody to understand
   3   you.
   4   A.  No problem.
   5   Q.  Thanks.
   6            You were talking about scientific clusters.
   7   A.  For graphical work stations.  So, one of our clusters,
   8   already a graphical work station, is used by scientists and
   9   engineers to simulate or visualize data sites so that people
  10   can understand them, what kind of data they're working with.
  11   Q.  And does VA Linux provide the software and the hardware
  12   for these systems?
  13   A.  Yes, we do.
  14   Q.  And what's the software on systems?
  15   A.  Usually it's just -- you know, we install Linux.  We
  16   configure it specifically for the hardware, so it performs
  17   well.  We do some third-party software that we add on top of
  18   it sometimes.  It depends on the need of customer.
  19   Q.  And does VA Linux provide anything other than for software
  20   and hardware for its customers?
  21   A.  Under the circumstances, you have professional services,
  22   integration services, deployment services.  That's about it.
  23   Q.  Is VA Linux a publicly-traded company?
  24   A.  Yes, we are.  We went public December of last year.
  25   Q.  And are there other publicly-traded companies that deal
                                                                991
   1   with the Linux operating system?
   2            MS. MILLER:  Objection.  Foundation.
   3            THE COURT:  Overruled.  Go ahead.
   4   A.  There are a number of them.  They're Caldera, Red Hat.
   5   Also companies like Dell, Compac and IBM all start up with
   6   Linux's efforts.
   7   Q.  And what is the nature of these efforts?
   8   A.  They saw the market growing, and so they're trying to
   9   address it in their own ways.
  10   Q.  Is this both software and hardware?
  11   A.  Yes.
  12   Q.  Based upon your -- excuse me, what is your position at VA
  13   Linux?
  14   A.  I'm a director in the marketing department.  My job is
  15   essentially development with the Linux community at large.
  16   So, they sort of have a way of talking with us, and we have a
  17   way of starting dialogue with them, if need be.
  18   Q.  And how do you accomplish that function?
  19   A.  A lot of different ways.  We give away hardware to groups
  20   who need it for their development.  We provide hosting and
  21   network bandwidth to projects that need it.  I go to trade
  22   shows and speak a lot, that sort of thing.
  23   Q.  Now, based upon your job at VA Linux, do you have
  24   information about how many people are using the Linux
  25   operating system now?
                                                                992
   1   A.  Yeah.  Currently, depending on who you talk to, it's about
   2   20 million people is the best guess right now.  That's from
   3   using numbers from IDC combined with sort of the work that
   4   Red Hat and we've done on sort of measuring the Linux market.
   5   Q.  And what is IDC?
   6   A.  IDC is a company up in Farmingham, Massachusetts that
   7   specializes in market research reports on the computer
   8   industry.
   9   Q.  And what are the uses for Linux right now?
  10   A.  Right now, Linux is --
  11            MS. MILLER:  Objection; relevance, foundation.
  12            THE COURT:  Sustained.
  13   Q.  Based upon your position at VA Linux, can you say how
  14   successful Linux is as a program right now?
  15            MS. MILLER:  Objection.
  16            THE COURT:  Sustained.
  17            MR. HERNSTADT:  Your Honor, on relevance?
  18            THE COURT:  Well, I think relevance.  I think
  19   foundation.  I think it's basically calling for hearsay.  You
  20   don't -- there is no definition of what "successful" means.
  21            MR. HERNSTADT:  O.K.
  22            THE COURT:  It's kind of like asking somebody who
  23   buys for supermarkets whether Tide is successful to get the
  24   stains out.  I don't know.
  25            MR. HERNSTADT:  I understand, your Honor.
                                                                993
   1   BY MR. HERNSTADT:
   2   Q.  Mr. DiBona, from the perspective of VA Linux and you, as
   3   the director of marketing, what is the measure of success in
   4   terms of the Linux operating system?  How would you measure
   5   it?
   6            MS. MILLER:  Same objection.
   7            THE COURT:  Overruled.
   8   A.  We measure it a number of different ways.  We rely on
   9   Netcraft to show us the growth of Linux in the Internet
  10   serving market.  That tells us how Linux is growing in terms
  11   of percentage of web servers out there.
  12            THE COURT:  What is Netcraft?
  13            THE WITNESS:  Netcraft is an another market research
  14   site.  What they do is they, using a program, sort of pull
  15   different machines on the Internet to see what they are
  16   running, and they put together a report based on that, and
  17   from this point they can tell if they're running Windows or
  18   Linux or whatever.
  19            And from information like this, we can tell how Linux
  20   is doing in the marketplace, and it helps us in our
  21   forecasting and predictions on our own sales because we know
  22   that our percentage of sales of that market is connected to
  23   the growth of Linux.  So, that's how we figure out how to
  24   attack the market.
  25   BY MR. HERNSTADT:
                                                                994
   1   Q.  And what results do you see today with respect to how
   2   Linux is growing in the market?
   3   A.  Well, specifically VA Linux has been growing depending on
   4   which part you look at, between 30 and 60 percent each
   5   quarter.  That's pretty much above what Netcraft is showing as
   6   a percentage of the Internet serving market.
   7            THE COURT:  I'm sorry.  I don't understand the
   8   answer.  What is VA?
   9            THE WITNESS:  VA, that's the company I work for.
  10   Sorry.
  11            THE COURT:  I see.  So, basically, what you are
  12   telling us is that this Netcraft service tells you that Linux
  13   is growing 30 to 60 percent per quarter.
  14            THE WITNESS:  No, that's our own numbers.  The
  15   Netcraft shows that Linux is growing anywhere --  basically a
  16   little percentage each month.
  17            THE COURT:  I'm sorry.  A little percentage each
  18   month?
  19            THE WITNESS:  Yeah, like a percent or two each month,
  20   as a percentage of total Internet circuit.
  21            THE COURT:  What percentage?  I'm not sure this was
  22   the right witness or that this isn't hearsay.
  23            Just out of curiosity, what percentage of the market
  24   for operating systems in the United States does Linux account
  25   for as far as if you know?
                                                                995
   1            THE WITNESS:  Internet serving market.  I can tell
   2   you a number that makes sense.
   3            THE COURT:  In the server market?
   4            THE WITNESS:  Yeah.  Specifically, Linux is about
   5   32 percent.
   6            THE COURT:  In the server market?
   7            THE WITNESS:  In the web server market.
   8            THE COURT:  In the web server market?
   9            THE WITNESS:  Yes.
  10            THE COURT:  And overall?
  11            THE WITNESS:  It's almost impossible to tell you.
  12            THE COURT:  All right.  Go ahead.
  13   BY MR. HERNSTADT:
  14   Q.  Does VA Linux have plans to expand into its desktop
  15   market?
  16   A.  We have a few offerings in the desktop market, but it's
  17   not a very large percentage of our sales right now.
  18   Q.  What kind of offerings do you have right now?
  19   A.  We have a very low-end desktop and sort of a medium-range
  20   graphical work station.
  21   Q.  What is limiting, if anything, about VA Linux's ability to
  22   get into the desktop market?
  23            MS. MILLER:  Objection.  Leading, foundation,
  24   relevance.
  25            THE COURT:  I don't see the relevance, counsel.
                                                                996
   1   What's the relevance?
   2            MR. HERNSTADT:  The relevance is that Mr. DiBona can
   3   testify about why there is a disparity between the server
   4   market and the operating system market for the general public
   5   and the desktop.
   6            THE COURT:  What does that matter to this case?
   7            MR. HERNSTADT:  It matters because one of the reasons
   8   it's different is the lack of applications and applications,
   9   such as, for example, a DVD player.  Those applications are
  10   necessary to make an operating system generally attractive and
  11   generally viable.
  12            And to the extent that this case is about DeCSS and
  13   DeCSS is a part of the reverse engineering project to bring
  14   DVD players to the Linux operating system, Mr. DiBona can
  15   testify that that's an essential ingredient in the viability
  16   of Linux as an operating system.
  17            THE COURT:  What has that got to do with the issues
  18   in this case?  This isn't the Microsoft case.  I could
  19   understand this line of questioning in the Microsoft case.
  20            MR. HERNSTADT:  I understand, your Honor.  I think
  21   what it gives you is more as to the liquidity of reverse
  22   engineering.
  23            THE COURT:  As to the --
  24            MR. HERNSTADT:  To the presence of reverse
  25   engineering.
                                                                997
   1            THE COURT:  To the presence of reverse engineering.
   2            MR. HERNSTADT:  That it is a normal and, in fact,
   3   necessary part of building Linux applications, that the DVD
   4   player application is a necessary part to make the Linux
   5   operating system viable, and it was DeCSS was part with the
   6   reverse engineering in order to give the DVD player a
   7   presence.
   8            I understand that when I was not here there were
   9   discussions about antitrust and --
  10            THE COURT:  That would be something of an
  11   overstatement.
  12            MR. HERNSTADT:  O.K.  I think that what this can
  13   show, though, is that if Linux and if applications are not
  14   made for Linux, then that will have an anti-competitive effect
  15   on the Linux operating system and will deny -- make it much
  16   more difficult for it to be viable, which will have an
  17   anti-competitive effect.
  18            THE COURT:  What's that got to do with this case?
  19            MR. HERNSTADT:  We have an affirmative defense.
  20            THE COURT:  Your affirmative defense is that the DMCA
  21   violates the antitrust laws.  I expressed myself fully on that
  22   last week.  That's not a defense to anything.
  23            MR. HERNSTADT:  I think, also, your Honor, in terms
  24   of statutory construction, perhaps it gives a certain amount
  25   of guidance that, if the statute permits, an interpretation as
                                                                998
   1   opposed to another interpretation, if one interpretation
   2   permits a situation that has anti-competitive effects and is
   3   bad for the public, because of that, that perhaps that's
   4   not -- that might be one of the factors that would --
   5            THE COURT:  You know, the patent laws have an
   6   anti-competitive effect.  If a drug company finds the cure for
   7   cancer and patents it, it will be the only drug company that
   8   can sell it.  They will charge whatever they want, and it will
   9   be highly anti-competitive, and it will be perfectly legal
  10   because the Patent Code so permits.  So, I just don't get the
  11   argument.
  12            MR. HERNSTADT:  I understand, your Honor.  This is
  13   not a patent situation.  The plaintiffs --
  14            MR. GARBUS:  Your Honor, can I just briefly be heard
  15   with regard to that?
  16            THE COURT:  I will hear you.
  17            MR. GARBUS:  I think the position that we take and
  18   the answer says the DMCA as interpreted applied, it doesn't
  19   say facially.  And what it says is that if this Court or any
  20   Court were to permit an anti-competitive situation, an
  21   antitrust situation to create that, that would be -- that
  22   would be an interpretation the DMCA made, which we believe
  23   runs up against Sony, Sega, and the other issues.
  24            I don't want to have the argument now.  I think the
  25   Court has expressed its feeling.  I just did want to point out
                                                                999
   1   that that is the position that we take to make it clear with
   2   respect to this witness' testimony.  And I know the Court
   3   disagrees.
   4            THE COURT:  Ms. Miller?
   5            MS. MILLER:  As the Court has already stated, the
   6   plaintiffs view this as completely irrelevant testimony.  The
   7   defendant has already admitted that he's not engaged
   8   personally in reverse engineering activities.
   9            And as far as whether or not there is a DVD player
  10   available, and if it's a Linux operating system, you've
  11   already heard testimony that other developers of DVD players
  12   have sought and in certain instances obtained licensing from
  13   the DVD-CCA and developed such players.  Again, this adds
  14   nothing to the record.
  15            THE COURT:  I take it, Ms. Miller, that you don't
  16   have any quarrel with the basic proposition that the ability
  17   of any operating system, be it Linux or anything else, to
  18   succeed in the marketplace is related to the extent to which
  19   applications that run under that operating system are
  20   available; is that true?
  21            MS. MILLER:  Theoretically and absolutely not.  We
  22   have no quarrel with that.
  23            THE COURT:  And not only theoretically, I take it you
  24   have no quarrel with the proposition that that's true for
  25   Linux.
                                                                1000
   1            MS. MILLER:  I don't know that that's true for Linux.
   2   I don't think we've heard through this witness whether or not
   3   that, in fact, is true.
   4            THE COURT:  Well, I was trying to save some time, but
   5   I guess we are not going to save some time.
   6            Go ahead, counsel.
   7            MR. HERNSTADT:  Thank you, your Honor.
   8            Actually, could we have the last question and answer
   9   read back before we went into the objection, your Honor?
  10            THE COURT:  Yes.
  11            (Record read)
  12            MR. HERNSTADT:  Thank you.
  13   A.  There is a certain lack of applications for the desktop
  14   market.  For instance, office productivity and certain
  15   vertical market applications for things like doctors, dentist
  16   offices, and that sort of thing.  You have to have a certain
  17   number of applications before you can sell the personal
  18   desktop, everything from software for small offices to large
  19   ones, so...
  20   Q.  Is the DVD player one of the applications that your
  21   company thinks would be necessary to make the Linux operating
  22   system viable for the personal market?
  23            MS. MILLER:  Objection, relevance.
  24            THE COURT:  I'm going to hear it.
  25   A.  Basically multimedia is still very important for the
                                                                1001
   1   personal market.  If we were to sell to an end user, we would
   2   have to be able to compete, and for DVD, CD, audio, the whole
   3   thing.  And most of that is that for Linux DVD is not because
   4   of the -- it is just the manufacturers never made a player,
   5   and when the people tried to write one themselves, the
   6   developers out there on the net and such, they were met with
   7   resistance, and that's why I'm here.
   8   Q.  Is VA Linux doing anything to develop applications?
   9   A.  Well, we have a couple of efforts.  My regular activities,
  10   where I give away hardware and make sure that people who are
  11   working on these kinds of problems are helped out however we
  12   can, be it by hosting or by serving or administration of our
  13   machines.
  14            We also have a project called Source Forge, and it
  15   hosts about 6,800 projects, and about 40,000 of them source
  16   developer, the idea being that if we administer the machines
  17   and take care of backups and provide for messages and
  18   discussions and reports, that they can get to the business of
  19   doing the software that they want to do without having to
  20   worry about the minutia of system administration and such.
  21   Q.  You said it hosts about 6,800 projects.  Are those
  22   different projects for Linux applications?
  23   A.  Yes.
  24   Q.  And who owns the application if the project is successful
  25   and completed?
                                                                1002
   1            MS. MILLER:  Objection, relevance, calls for
   2   speculation.
   3            THE COURT:  Overruled.
   4            They are owned by the project leaders and the
   5   developers on the site.  VA doesn't take an ownership of the
   6   projects.  They are just there to help.
   7   Q.  Mr. DiBona, do you know what DeCSS is?
   8   A.  Yes.
   9   Q.  Have you ever used DeCSS on a DVD?
  10   A.  For the purpose of my writing my declaration, I used DeCSS
  11   to copy a VOB file off of a DVD.
  12   Q.  Have you ever made a DVD available on the Internet to
  13   other people to upload?
  14   A.  Never.
  15   Q.  Have you ever downloaded a DVD from the Internet?
  16   A.  Never.
  17            MR. HERNSTADT:  Thank you very much.
  18            THE COURT:  Thank you, Mr. Hernstadt.
  19            Ms. Miller?
  20            MS. MILLER:  No questions, your Honor.
  21            THE COURT:  All right.  Thank you, Mr. DiBona.  You
  22   are excused.
  23            THE WITNESS:  Thank you, your Honor.
  24            THE COURT:  Next witness?
  25            (Witness excused)
                                                                1003
   1            MR. HERNSTADT:  Your Honor, the defendants call on
   2   Olevario Craig.
   3   OLEVARIO LOPEZ CRAIG,
   4        called as a witness by the defendant,
   5        having been duly sworn, testified as follows:
   6            THE CLERK:  State your name, spelling it slowly.
   7            THE WITNESS:  Olevario Lopez Craig.  O-L-E-V-A-R-I-O
   8   L-O-P-E-Z   C-R-AI-G.
   9            THE COURT:  Counsel, you may proceed.
  10            MR. HERNSTADT:  Thank you.
  11   DIRECT EXAMINATION
  12   BY MR. HERNSTADT:
  13   Q.  Mr. Craig, where do you live?
  14   A.  In Amherst, Massachusetts.
  15   Q.  Can you describe your educational background, please?
  16   A.  I assume you just want higher education.
  17            I attended UMASS in the fall of 1998 and spent three
  18   years as a computer science major, dropped out for reasons
  19   both academic and non, and then came back to complete a degree
  20   in communications, which is a B.A., and that was -- I finished
  21   in May of 1995.
  22   Q.  How long have you been working with computers?
  23   A.  Depends on how one defines "working," but I've been using
  24   computers since, oh, I would guess 1983.  I've been employed
  25   regarding computers since mid-high school, which would be
                                                                1004
   1   1986.
   2   Q.  And could you describe your employment history?
   3   A.  With regard to computers?
   4   Q.  Sure.
   5   A.  Several summer jobs, working for a small software company
   6   in Waltham, Massachusetts, which is now defunct by the name of
   7   DataTree.  At that point in time, I did things like create
   8   their software distributions, make the floppy disks that
   9   actually had the software on it, package it up, send it out.
  10            I also set up a bulletin board system, which was at
  11   that point the height of customer service technology, not
  12   really related to work.  But at the same time, the high school
  13   that I attended had old deck hardware, Digital Equipment
  14   Corporation hardware, including VAX 11780 and previously
  15   PDP1170, both of which ran Unix Operations, U-N-I-X operating
  16   systems.
  17   Q.  And how long have you been employed by the University of
  18   Massachusetts?
  19   A.  Since shortly after graduation in 1995.
  20   Q.  What is your position there?
  21   A.  Well, my position has changed somewhat over the past five
  22   years, but I was initially hired as entry-level software
  23   support for people who were familiar with ISP, that would be
  24   analogous to help desk support.  You call up and you tell
  25   somebody that something is not working and they help you
                                                                1005
   1   figure it out.
   2            I have since moved away from that and into second and
   3   third tier operations, operating systems applications and
   4   networking support.
   5   Q.  And have you done any consulting work?
   6   A.  From time to time, on the side, I do various bits and
   7   pieces, mostly relating to people who want to set up
   8   networking in their mall business or home office.  I've had a
   9   few clients.  I couldn't really point to a number, probably
  10   less than five over the last three years.
  11   Q.  And what operating system do you use in your work?
  12   A.  At work, we have a very heterogenous environment.  We
  13   maintain seven different players of Unix operations.  One
  14   includes Unix, in addition to Windows NT, '95, and Windows
  15   2000, and several different versions of the McIntosh system.
  16   Q.  And what operating system do you use at home?
  17   A.  In my house, I have several computers.  On my main
  18   computer, the one that I use most often, I have both Linux and
  19   Windows '98.
  20   Q.  And Mr. Craig, are you being paid to be here today?
  21   A.  I am not.  Actually, spending my vacation time to be here.
  22   Q.  You said that you have a Windows program on your home
  23   computer.  What do you use that for?
  24   A.  Interestingly enough, as it pertains to this case, I use
  25   Windows -- I have Windows on my home computer as a bootable
                                                                1006
   1   operating system solely to be able to play DVDs.  I don't
   2   really play games anymore.  There aren't many reasons, from my
   3   point of view, to actually boot into Windows, rather than run
   4   it under an application like VM Ware.  Playing DVDs is really
   5   the only reason why I have Windows as a bootable operating
   6   system on my home computer.
   7   Q.  Can you explain what the difference is between booting
   8   into Windows and using it in an application like VM Ware?
   9   A.  Certainly.  It's typical when setting up a Linux system on
  10   a system that already has Windows installed, to set it up on
  11   what's called a dual boot, meaning that if you turn the
  12   computer on, you have the choice of which operating system to
  13   run.
  14            And, thereafter, after that session, you are locked
  15   into that operating system.  In other words, to get to the
  16   other operating system, you have to reboot the operating
  17   system controlling the computer completely.
  18            And if you want to run programs from another
  19   operating system, you have to reboot.  The only reason that I
  20   boot into Windows is that I can run the software in running my
  21   DVD player card.  The software to do that under Linux -- which
  22   tells me it's going to happen really soon -- is not yet really
  23   ready for just sitting down and playing.
  24            MR. COOPER:  Move to strike the last portion; hearsay
  25   grounds.
                                                                1007
   1            MR. HERNSTADT:  Your Honor, I can inquire what the
   2   basis of the --
   3            THE COURT:  All right.  Go ahead and do that.
   4   Q.  Mr. Craig, when you were talking about the Linux DVD
   5   player, what is the basis of your knowledge, if any, about the
   6   Linux DVD player?
   7   A.  Well, starting, I would guess, sometime in November or
   8   December of last year, I was really looking to get Windows off
   9   of my home computer.  I had reached a level of frustration
  10   with it, and as I said, I decided that I really didn't need it
  11   for anything else.
  12            So, I was looking for a Linux application to play
  13   DVDs and went to the Web and searched and found the LiViD home
  14   page, followed the links and saw that there was this ongoing
  15   trial, but that there was something there that could be
  16   downloaded from the CVS repository.  So, I downloaded at that
  17   point in time and built it -- wasn't really able to get it to
  18   work satisfactorily.
  19            At that point, it was particularly on my particular
  20   hardware decoder card which wasn't supported, and it wasn't at
  21   a level that I felt comfortable to try to replace my Windows
  22   application operating system.
  23   Q.  Would you explain, Mr. Craig, what the CVS is?
  24            MR. COOPER:  Relevancy, your Honor.
  25            THE COURT:  Overruled.
                                                                1008
   1   A.  It has nothing to do with pharmacies.  It stands for
   2   Concurrent Version System.  It's a method by which people can
   3   work on a single code base and download the code, make
   4   changes, fix bugs, upload the code, and merge it into a
   5   coherent hole.
   6   Q.  Mr. Craig, in your position as the systems administrator
   7   in the computer science department in Amherst, Massachusetts,
   8   have you worked with the network for the computer science
   9   department?
  10   A.  Extensively.  I'm involved in design decisions.  I don't
  11   usually make purchasing decisions, but I help lay out the
  12   groundwork for what needs need to be filled, where we should
  13   go for upgrade capacity, what kind of room we need to leave
  14   ourselves for future improvement.
  15   Q.  And are you also familiar with the University of
  16   Massachusetts' network of a hole?
  17   A.  I am familiar to a lesser degree.  It's not a network that
  18   I administer personally, but I do know a great deal about how
  19   it works by necessity because we are connected to it.  I also
  20   know a great deal about the hardware on which it runs.
  21   Q.  And what's the basis of your knowledge?
  22   A.  Having to work with it, having to connect to it, it's also
  23   a point of interest for what we do in order to tell an
  24   incoming student or a prospective student or prospective
  25   faculty member what kind of facilities they're going to have.
                                                                1009
   1            We regularly try to update our own description on
   2   what the University of Massachusetts has for technology
   3   resources and particularly after my deposition in this case, I
   4   went and made it my business to research more about the UMASS
   5   network in specific.
   6   Q.  Is research a part of your job?
   7   A.  Absolutely.
   8   Q.  And how do you research -- do you do research information
   9   about systems or networks or the research that you do in your
  10   job?
  11   A.  The web is by far the greatest tool that has ever been
  12   invented for research.  Second to that, there is the archive
  13   of news groups at what's called Deja News, which allows one to
  14   see roughly the last five to ten years' worth depending on the
  15   hierarchy of on-line discussions regarding any subject, you
  16   can imagine the subjects that I generally go looking for are
  17   hardware and software integration, but the web is certainly a
  18   primary source.
  19   Q.  Is that true for systems administrators generally or is
  20   that true just for you?
  21   A.  I think that's absolutely true for systems administrators
  22   in general.  Without the Web, finding information necessary to
  23   solve problems becomes much more difficult.
  24   Q.  Mr. Craig, could you describe the topology of the
  25   University of Massachusetts network?
                                                                1010
   1   A.  The UMASS network itself or our section of it, the campus
   2   backbone, which is the core of the network is what's called
   3   star wired single mode fiber that is gigabyte Ethernet.  It
   4   has a transfer of theoretical maximum capacity of 1,000
   5   megabits per second.
   6            That is attached to five routers from which
   7   subsections of networking depend at a speed of 100 megabits
   8   per second.  So, it uplinks to the routers of 100 megabits per
   9   second.
  10            From those five sections, you get various physical
  11   areas of campus.  The southwest residential area, as an
  12   example, has its own switch which is connected to the --
  13   actually, it's a Cisco 5500 switch, which is connected to the
  14   Whitmore switch, which is one of the five switches on one of
  15   the five switches connected to the routers in the backbone.
  16            Other areas of campus are likewise funneled into
  17   those five routers.  Typically, an area of campus right -- if
  18   you think of it as a tree coming out from that router, you'll
  19   get thinner and thinner branches, but most sections of campus
  20   one of 100 megabit Ethernet right up to the point where one
  21   dissolves, so the leaves, the nodes, where you generally get
  22   between 10 and 100 megabits per second depending on that
  23   particular section of campus and the architecture and what
  24   it's required to do.
  25            I should state that an exception to all of this is my
                                                                1011
   1   network or what I like to think of as my network which is
   2   attached outside the campus backbone directly to the router
   3   that connects both to the cable and wireless Internet
   4   connection, which is our commodity Internet connection.
   5   Q.  Do you know who has access to the Internet to connections?
   6   A.  I know that access from the dorms is extremely limited.
   7   That router is rate limited and, in fact, we are -- I think we
   8   are the only department on campus that can take as much
   9   bandwidth as we need for that router.
  10            MR. COOPER:  Move to strike, your Honor.
  11            The witness was asked whether he knew and then he
  12   supplied an answer, which I believe is based on hearsay.
  13            THE COURT:  Is that right Mr. Craig?
  14            THE WITNESS:  I don't believe so.
  15            THE COURT:  Well, how did you know what you just told
  16   us?
  17            THE WITNESS:  Because I've seen the router and I've
  18   worked with the cables that are connected to it.
  19            THE COURT:  Motion denied.
  20   Q.  What is the speed -- or excuse me -- the bandwidth of the
  21   Internet connection from the campus backbone to the Internet?
  22   A.  It's what's called a partial DS-3.  We have 30 megabits
  23   per second on the cable and wireless router.
  24   Q.  By way of example, could you explain the different
  25   switches or connections that a file sent from a dorm room to
                                                                1012
   1   the Internet would have to go through on the way?
   2            MR. COOPER:  Lacks foundation.
   3   Q.  Do you know from personal knowledge how the topology of
   4   the Internet, so that you could describe that based on your
   5   knowledge?
   6   A.  Yes.
   7   Q.  O.K., could you do so, please?
   8            MR. COOPER:  Lacks foundation.
   9            THE COURT:  Overruled.
  10   A.  I mentioned earlier the southwest dormitories which are
  11   the single largest residential area on campus.  A file going
  12   from a dorm room in the southwest dormitories would go from
  13   the student's computer to what's called a node room, a switch
  14   Ethernet connection to a node room in the dorm, there are up
  15   to three node rooms per dormitory.
  16            The node rooms have switches in them that are 10
  17   megabits to the students' rooms and then they are star wired
  18   with 100 megabit uplink to a core switch, which would then go
  19   to the aforementioned Cisco 5500 router switch off of the
  20   southwest residential area, which is connected to the
  21   Whitmore, which is connected to the Whitmore -- I can't
  22   remember the numbers.
  23            It's connected to a Cisco router at the Whitmore
  24   point of presence on the backbone.  So, it would then go from
  25   100 megabit between the southwest switch and the Whitmore
                                                                1013
   1   switch to the gigabit Ethernet on the backbone.  Then it would
   2   go to the LGRC router, which connects to the cable and
   3   wireless router and out to the commodity Internet.
   4            THE COURT:  Is the bottom line of all this that if
   5   somebody wanted to up or download a file from a dorm room, the
   6   transfer rate limitation would be the 10-megabit-per-second
   7   switch in the dorm and whatever proportion of that capacity
   8   might be available at the moment to the particular user?
   9            THE WITNESS:  Actually, it's a little bit more
  10   complicated than that.
  11            THE COURT:  Go ahead.
  12            THE WITNESS:  I mentioned the 100 megabit uplink to
  13   the -- let's take the 100-megabit section between the node
  14   room and the southwest router.  That 100-megabit uplink is
  15   taking all the traffic from -- if we have a large dorm, we
  16   have three node rooms.  It's taking all of the traffic from
  17   all of the students in those rooms.  I think the largest dorm
  18   we have on campus is in the realm of 1,400 students.
  19            I know that we have at least 1,400 students in a
  20   single dorm because I was in such a dorm.  So, that's 1,400
  21   guided by a maximum of three node rooms.  And if you have any
  22   proportion of those 1,400 students using the Internet, what
  23   you're going to see is not a fraction of the
  24   10-megabit-per-second link to the student which is actually
  25   switched.
                                                                1014
   1            You're going to see a fraction of the
   2   100-megabit-per-second uplink which is shared among those
   3   1,400 students.
   4            THE COURT:  O.K.  Thank you.
   5            Mr. Hernstadt?
   6   Q.  Has University of Massachusetts upgraded its system in the
   7   last two years?
   8   A.  Extensively.
   9   Q.  And at which points on the route have they made the
  10   upgrades?
  11   A.  The dorm networking project is ongoing, so they are
  12   pulling what in industry is called the last mile, but in the
  13   legal area network, it's actually a much shorter distance into
  14   new dormitory rooms probably as we speak.
  15            We have I think 42 dormitories total that plan to be
  16   wired, and I think of those, 35 are completed.  They have also
  17   upgraded the campus backbone which used to be fiber digital
  18   internet, FDDI, F-D-D-I.  They have upgraded that to single
  19   mode fiber gigabit Ethernet.
  20            They have -- because that that particular change
  21   necessitates a change in technology, they had to upgrade all
  22   the routers connected to the gigabit mesh.  The previous
  23   router would not accept any technology.  And they have
  24   upgraded the router that connects to -- they've upgraded the
  25   routers that connect both to the commodity and the cable and
                                                                1015
   1   wireless commodity Internet and the Internet 2 connection.
   2            THE COURT:  I take it, Mr. Craig, that it is not
   3   actually unheard of for students to access the Internet at the
   4   University of Massachusetts from computers that are not in
   5   their dorm room; right?
   6            THE WITNESS:  That's correct.
   7            THE COURT:  It happens in the computer science
   8   department from time to time?
   9            THE WITNESS:  Well, yes.  We have an educational
  10   laboratory that at the moment has 20 computers that we are
  11   keeping and 20 computers that we are throwing out because
  12   they're too old and we are planning to upgrade it with a bunch
  13   of Linux PCs; however, and there are other facilities on
  14   campus where students attach to a particular program, would be
  15   able to use the computers directly connected to the Internet.
  16            There are also places on campus and I actually ran
  17   one when I was a student that are just labs for general use
  18   and all you have to have is a student I.D. to be able to sit
  19   down at a computer.  These are, however, monitor situations.
  20            As an example, I have -- I have myself in the past
  21   terminated student access to the educational lab computers for
  22   resource starvation and what we call misuse of the resources.
  23   There was one person who was continually keeping enormous
  24   files on a shared disk and preventing other students from
  25   completing their classwork because the disk was full with --
                                                                1016
   1   actually what he was downloading was the Linux source industry
   2   at that time.  So, it wasn't the content of the -- the use
   3   that we found objectionable, it was simply the fact that he
   4   was using so much that other people couldn't use the research
   5   and, therefore, it was against our policy.
   6            THE COURT:  O.K.  Go ahead, Mr. Hernstadt.
   7   BY MR. HERNSTADT:
   8   Q.  You testified before in response to the judge's questions
   9   that the point -- it would not be the 10-megabit switched
  10   network in the dorm room that would limit transfer rates, but
  11   100-megabit uplink.  Has -- is that correct?
  12   A.  That's actually oversimplifying, and I apologize since it
  13   was obviously my fault for the oversimplification.  It would
  14   most likely be the fraction of the 100 megabit Ethernet that
  15   would be the pinch point.  At no point in time is a single
  16   student going to get more than 10 megabits down or up.  We
  17   don't do differential upload and download rates.
  18            However, more likely, if you have a significant
  19   number of people in that 1,400-person dorm that I mentioned
  20   using the Internet, it's not going to be their individual
  21   10-megabit-per-section connections that's going to limit them.
  22   Rather, it's going to be the fact that they have to divide one
  23   megabit, that one single 100-megabit Ethernet connection
  24   between all of them.
  25            And as I said, in a case with 1,400 students, that's
                                                                1017
   1   significantly less than a fraction of then a
   2   10-megabit-per-second link.  If you were to assume that 700 of
   3   those 1,400 students were using the Internet at one time, you
   4   could probably work out the math better than I can.
   5            Without a calculator on me, I would guess you'd get
   6   less than two megabits per second out of that entire hundred.
   7   You'd get less than -- probably less than 500 mg.
   8            MR. COOPER:  Your Honor, move to strike the last
   9   portion of that as speculation, without foundation.
  10            THE COURT:  It's arithmetic; overruled.
  11   Q.  And Mr. Craig, based on your knowledge of the University
  12   of Mass. network and the upgrades that are being done to it,
  13   what would they have to upgrade for to relieve that pinch
  14   point?
  15   A.  They would have to put in -- the problem with relieving
  16   that pinch point is that's the best logical place to put the
  17   pinch point.  We only have 30 megabits per second out to the
  18   Internet total, so there has to be a pinch point someplace and
  19   it's better not to have it on the incoming router.
  20            Particularly since there is a predilection in the
  21   administration level to provide better service to, for
  22   instance, the computer science department than to the
  23   dormitories as a whole because there are researchers in the
  24   computer science department who are doing research and
  25   collaboration with international figures and they really need
                                                                1018
   1   that bandwidth.
   2            So, it's difficult to answer your question.  They'd
   3   have to spend a lot of money on a bunch of different places.
   4   The network as it is I think is optimized pretty much as well
   5   as it can be without spending an enormous amount of money.
   6   Q.  Are you personally knowledgeable about the Internet access
   7   available to consumers in their homes in the area of the
   8   University of Massachusetts?
   9            MR. COOPER:  Foundation, your Honor?
  10   Q.  And if you are, could you tell us what the basis of that
  11   personal knowledge Is?
  12   A.  Earlier this spring, I gave a talk to the assembled
  13   faculty grad students and staff regarding their options as to
  14   home access.  As you might imagine, it's a very hot topic
  15   among computer science professionals, the ability to be
  16   connected at all times, and we did, myself and a coworker, did
  17   a survey of what was available in the area, what was planned
  18   to be available in the area for the next -- for the
  19   foreseeable future, in other words, as much information as the
  20   local providers were willing to give us, "providers" meaning
  21   cable modem providers, DSL providers, the telecommunications
  22   companies that are in the area currently.
  23            In particular, I focused on cable modems, but we did
  24   a great deal of research into DSL available as well, because
  25   there are some areas where DSL is available.  There are some
                                                                1019
   1   areas where cable modems are available and there are some
   2   areas where both are available and at that point, we had a lot
   3   of professors asking us, which should I choose?  Which would
   4   be better in the long run?
   5   Q.  And what is the name typically given that to type of
   6   network?
   7            MR. COOPER:  Your Honor --
   8            THE COURT:  To what kind of network?
   9            MR. HERNSTADT:  The network of Internet access
  10   providers to a locality or a region and in this case, the
  11   region around Amherst.
  12            MR. COOPER:  This is a topic we've never heard from
  13   this witness before, never heard about this study, never had
  14   it provided to us.  I have no reason to believe he has
  15   expertise in this area of general network and consumer speed
  16   access in the general area around his university.  He's
  17   certainly not employed in the area and has no apparent
  18   expertise.
  19            THE COURT:  Well, look, I am going to hear what he
  20   has to say.  But, Mr. Hernstadt, if the point of all this is
  21   to suggest that consumers will not have in the foreseeable
  22   future adequate bandwidth to upload and download movie files
  23   from the Internet, you are sure not going to do it by
  24   addressing Amherst, Massachusetts, it's atypical of which as
  25   measured against urban markets is perfectly obvious to
                                                                1020
   1   anybody.
   2            MR. HERNSTADT:  Actually, the point is slightly
   3   different than that.
   4            THE COURT:  All right.  Go ahead.
   5            MR. HERNSTADT:  O.K.
   6   Q.  Let me be more specific.  The network at the University of
   7   Massachusetts is known as a local area network, is that
   8   correct?
   9   A.  That's correct.
  10   Q.  What is the name given to the network of a region such as
  11   around the University of Massachusetts?
  12   A.  Generally, you wouldn't collectively call that a network.
  13   You would call it wide-area networking.  It is an
  14   implementation thereof, but one doesn't think of local area
  15   networking as what you can put in a small defined physical
  16   area because there are limits to the lengths of cables in the
  17   technologies involved.
  18            Specifically, for 100-megabit Ethernet, I believe
  19   you're limited to 200-meters total between devices, so between
  20   the computer and a switch or a repeater.  And you can't really
  21   achieve more than five kilometers even using fiber, which is
  22   able to span greater distances.
  23            You can't really go more than five kilometers between
  24   one end point on the network and another end point on the
  25   network.  So, the technologies for local area networks are
                                                                1021
   1   very different from the technologies used for wide-area
   2   networks.  When you start trying to connect --
   3            THE COURT:  What exactly is wide-area networking as
   4   you are using the term?
   5            THE WITNESS:  Any networking technology used to
   6   connect physical places that are not contiguous, that are not
   7   close to each other.
   8            THE COURT:  So, under that definition, ordinary
   9   telephone lines are all part of a wide-area network, is that
  10   right?  Because you can transmit data over them and they are
  11   in the physically contiguous locations?
  12            THE WITNESS:  That would be -- yes, that would be
  13   correct.
  14            THE COURT:  O.K.
  15   Q.  And did you have -- have you studied wide-area networking
  16   in the your course of studies at the University of
  17   Massachusetts?
  18   A.  Not in my course of studies, but as part of research for a
  19   consulting client who was wondering about what kind of network
  20   connection they should get in to a small business.  The
  21   difference between a cable modem and the next step up which
  22   would be a T1 using frame relay.
  23            The T1 using frame relay was, at that point in time,
  24   $1,600 a month and a cable modem, which is soon to be
  25   available at that time, this was I think a year and a half ago
                                                                1022
   1   was projected to be $50 a month.
   2            THE COURT:  Look, Mr. Hernstadt, if you want to
   3   elicit from him what he found out when he went around and
   4   asked people what kind of connections they could get in
   5   Amherst, Massachusetts ask him.  If you want to qualify him on
   6   this subject --
   7            MR. HERNSTADT:  Actually, two or three more questions
   8   on this subject.
   9            THE COURT:  All right.
  10   Q.  As a result of your research, did you learn the costs of
  11   how much it would cost to upgrade wide-area networking?
  12            MR. COOPER:  Objection, your Honor; foundation.
  13            THE COURT:  I don't understand what that question
  14   means.  I mean, by his definition, one possible answer to that
  15   is what it would cost to replace all the telephone wires in
  16   that part of the country.  What does it mean?
  17            MR. HERNSTADT:  O.K.  I can use -- take a few more
  18   questions and be a little bit more specific.
  19   Q.  In conducting your research into the Amherst region, as
  20   you described before, did you learn the types of equipment
  21   that were used in the Amherst region to provide Internet
  22   connections to the consumers there?
  23   A.  Yes.
  24   Q.  And -- I'm sorry, well --
  25   A.  You can basically divide them into two categories, those
                                                                1023
   1   that are delivered by telephone and those that are delivered
   2   by other wires into the house, well, a cable into the house.
   3            Everyone needs some way to get the information into
   4   and out of the house in order to provide service.  The focus
   5   in the industry has been on wires that already exist in the
   6   house, which basically means cable, telephone, and power, I
   7   suppose.
   8            The power technology really doesn't seem to have gone
   9   anywhere.  The cable and telephone solutions have reached a
  10   point where any improvements in their service is limited by
  11   the physical characteristics of the wires into the house.  So,
  12   in order to upgrade any of the -- the rates that you can now
  13   get with a cable modem over the DSL connection, the person
  14   providing the service would have to pull new wires, which
  15   seems to be something that everybody is trying to avoid.
  16   Q.  And in the course of your research --
  17            MR. COOPER:  Move to strike that last comment as
  18   plainly without foundation.
  19            THE COURT:  Yes, I'm striking it.  I simply do not
  20   accept this gentleman as an expert on this subject.  So,
  21   whatever opinion testimony he's giving, it's useless.
  22            MR. HERNSTADT:  I'm not asking for his opinion
  23   testimony.  I'm asking for what his research revealed to him
  24   and specifically in terms, the next question I'm going to ask
  25   is what did he learn -- did he learn in his research about the
                                                                1024
   1   cost of upgrading the types of networks that he just described
   2   in comparison with the cost of upgrading a local --
   3            THE COURT:  As I told you, if you want him to tell
   4   you what Southern New England Tel. or whatever it is out there
   5   told him what it costs to put in a T1 line, I'll let you ask
   6   him that, but your questions are less focused.
   7            MR. HERNSTADT:  I'll move on.  May I approach the
   8   witness?
   9            THE COURT:  Yes.
  10   Q.  Mr. Craig, I've handed you Defendant's Exhibit BDT.  Could
  11   you look at it and identify it, please.
  12   A.  Yes, this is a declaration that I wrote regarding some of
  13   the claims made in the Shamos declaration, I believe the
  14   second Shamos declaration.
  15   Q.  Shamos or the --
  16   A.  I'm sorry; Schumann.  My apologies.
  17   Q.  And this is your declaration, is that correct?
  18   A.  This is my declaration, that's correct.
  19   Q.  And does this set forth experiments that you personally
  20   undertook?
  21   A.  Yes, it does.
  22   Q.  And is everything in this declaration a description of
  23   acts that you personally undertook?
  24            MR. COOPER:  Objection, your Honor.
  25            Is the intent to submit this as the witness'
                                                                1025
   1   testimony by having him affirm the truth of it?
   2            THE COURT:  I don't know.
   3            MR. HERNSTADT:  This is a declaration that sets forth
   4   experiments that Mr. Craig conducted regarding transfer rates
   5   available on the University of Massachusetts.  Rather than
   6   walk him through it, I would offer this into evidence and I'm
   7   trying to establish that this is a factual statement of acts
   8   that he undertook himself.
   9            THE COURT:  So, I guess the short answer is, yes, Mr.
  10   Cooper.
  11            MR. COOPER:  I object to the form.  It's also without
  12   foundation.
  13            THE COURT:  What's wrong with the form?
  14            MR. COOPER:  To begin with, your Honor, I believe
  15   that it is obviously compound and I think that if a proper
  16   foundation were attempted to be laid, we would find that the
  17   conclusions are based on a variety of assumptions for which
  18   there is no factual basis.
  19            THE COURT:  Well, you can cross-examine.
  20            Now, what is the other objection?  You said you have
  21   two objections.  One was form and I asked you about form, and
  22   you told me.  What was the other one?
  23            MR. COOPER:  Foundation.
  24            THE COURT:  Overruled.
  25            I'm going to receive this.  The points counsel makes,
                                                                1026
   1   they can cross-examine.
   2            MR. HERNSTADT:  Thank you, your Honor.
   3            (Defendant's Exhibit BDT received in evidence)
   4   Q.  Mr. Craig, do you know what DeCSS is?
   5   A.  Yes, I do.
   6   Q.  Have you ever used DeCSS on a DVD?
   7   A.  No.
   8   Q.  Do you know what DiVX is?
   9   A.  Yes, I do.
  10   Q.  Have you ever used DiVX on a DVD?
  11   A.  No, I have not.
  12   Q.  Have you ever made a movie available on the Internet for
  13   uploading?
  14   A.  No, I have not.
  15   Q.  Have you ever downloaded a movie from the Internet?
  16   A.  No, I have not.
  17            MR. HERNSTADT:  Thank you very much, Mr. Craig.
  18            THE COURT:  All right.  Thank you, Mr. Hernstadt.
  19            Mr. Cooper?
  20   CROSS-EXAMINATION
  21   BY MR. COOPER:
  22   Q.  Good morning, Mr. Craig.
  23   A.  Good morning.
  24   Q.  You have no job responsibility for the portion of the
  25   University of Massachusetts network that involves the
                                                                1027
   1   dormitories; correct?
   2   A.  That's correct.
   3   Q.  Your job responsibilities are limited to that portion of
   4   the computer system which is contained within the computer
   5   science department; correct?
   6   A.  More or less, correct.  I would add that I also support
   7   professors and students who are connecting from other places.
   8   So, to that extent, I would say that I support more than just
   9   the network contained within our department.
  10   Q.  And your direct responsibility by definition of your job
  11   description is limited to the computer science, computer
  12   system; correct?
  13   A.  That's correct.
  14   Q.  Now, again, your declaration, Exhibit BBT, could you
  15   please turn to paragraph 4 on page 2.  You refer in that
  16   paragraph to certain tests you conducted; correct?
  17   A.  That's correct.
  18   Q.  Now, those tests did not actually involve any downloads
  19   from the Internet; correct?
  20   A.  No, that's not correct.  The first --
  21   Q.  Let me understand.  You used certain T1 and 10-megabit and
  22   100-megabit lines in your experiment; correct?
  23   A.  That's correct.
  24   Q.  And you adjusted the speed at which some of those lines
  25   operated in order to simulate certain speeds that you expected
                                                                1028
   1   to receive in connection with downloads; correct?
   2            MR. HERNSTADT:  Objection to the form of the
   3   question.
   4            THE COURT:  Overruled.
   5   A.  I adjusted one of the tests to simulate a 10-megabit
   6   connection.  That test is listed as subparagraph B of that
   7   paragraph.
   8   Q.  Where did you get the files that you actually downloaded?
   9   A.  I created them.
  10   Q.  And where were those files taken from when you downloaded
  11   them?
  12   A.  I should make a distinction here in test A, I did not do
  13   the downloading.  I offered for downloading and a
  14   co-conspirator, if you will, a fellow by the name of Sean
  15   Standish downloaded over the Internet from me.
  16   Q.  And in the second test, paragraph 4B, there was no
  17   download from the Internet at all; correct?
  18   A.  That was downloaded from a computer on our network to
  19   another computer on our network.
  20   Q.  So, it doesn't reflect any Internet download speeds?
  21   A.  It reflects download speeds within a local area network
  22   which was what I was trying to address with that test.
  23   Q.  But it doesn't reflect any actual experience on the
  24   Internet; does it?
  25   A.  For B, it does not; that's correct.
                                                                1029
   1   Q.  And the same is true for C; is it not?
   2   A.  That is correct.
   3   Q.  And the same is true for D; is it not?
   4   A.  That is correct.
   5   Q.  And all of those speeds as to which you testified in B, C
   6   and D of paragraph 4 of your declaration are created by,
   7   assuming certain decreases in the maximum potential download
   8   speed from the systems you were using; correct?
   9   A.  I'm sorry.  I don't think I understand your question.
  10   Q.  Well, do I understand correctly that there were certain
  11   assumptions built into your laboratory process as reflected in
  12   B, C and D?
  13   A.  I -- perhaps you can identify assumptions that you think I
  14   made.  I'm not certain what you're asking.
  15   Q.  Well, actually your declaration doesn't explain how it is
  16   that you generated the particular speeds that you did generate
  17   and since they weren't on the Internet, I'm asking you what
  18   assumptions went into the process that resulted in the speeds
  19   that you did generate?
  20   A.  How do you refer to generating speeds?  Are you talking
  21   about the speeds of the cables and switches which I put in
  22   between?
  23   Q.  Yes.
  24   A.  Those are described in Exhibit 1.
  25   Q.  And you constructed those for purposes of this laboratory
                                                                1030
   1   experiment, is that correct?
   2   A.  No, I used what was available on our local area network.
   3   The only exception is 4B where in order to simulate a slower
   4   lab, I downgraded a switch -- downgraded a port on a switch.
   5   Q.  And for each of these experiments, have you downloaded a
   6   650 megabyte file rather than the 1.5 gigabyte file, the
   7   actual download times would have been substantially less;
   8   correct?
   9   A.  Probably.
  10   Q.  Do you know what those download times would have been for
  11   a 650 megabyte file at even the speeds that you created in
  12   this laboratory environment?
  13   A.  I don't know off the top of my head, but if you want, I
  14   can take out a calculator.  Would you like me to do that?
  15   Q.  Let's see if it makes sense for me to suggest some times
  16   for you and you can tell me if it sounds about right.
  17            THE COURT:  Well, is the relationship linear,
  18   Mr. Craig?
  19            THE WITNESS:  The reason I chose a file size that
  20   charge was to eliminate any possibility of there being a
  21   relationship between the file size and an increasing or
  22   decreasing rate of return.  So, yes, the relationship should
  23   be linear.
  24   Q.  It's a constant relationship?
  25   A.  More or less.  It's -- it would be expressed in a function
                                                                1031
   1   with a constant, if you will.
   2   Q.  Does the percentage difference that you would receive
   3   downloading a 650 megabyte file, as opposed to a 1.5 gigabyte
   4   file equal 43.3 percent?
   5   A.  Wouldn't equal it.  It would probably be 43. -- I'm
   6   assuming without doing the math in my head that that's the
   7   percentage of 650 megabytes to 1.5 gigabytes.
   8   Q.  So, the answer is yes?  That sounds right?
   9   A.  If we stipulate that that's the mathematics of it, then it
  10   would be that percentage, plus a certain constant for
  11   overhead, probably something like 5 percent, between 2 and
  12   5 percent.
  13   Q.  That's a constant for overhead?
  14   A.  Yes.
  15   Q.  And how do you arrive at a constant for overhead?
  16   A.  There is a certain amount of data that has to be sent with
  17   each packet and even though you can put a lot of data into a
  18   single packet, you have to increase it by a constant for the
  19   length of the packet.
  20   Q.  So that an amount of the overhead would actually be higher
  21   for a 1.5 gigabyte file than it would be for a 650 gigabyte
  22   file?
  23   A.  No, the amount of the overhead would be higher for the 650
  24   megabyte as a percentage of the total transfer.
  25   Q.  Total time would still be reduced by the reduced number of
                                                                1032
   1   packets; correct?
   2   A.  Well, I think I understand what you're saying and the
   3   answer is probably yes, but packets are not a unit of time.
   4   So, I agree with you, but that's not quite how you phrased the
   5   question.
   6   Q.  You mentioned in paragraph 4D that your experiment in the
   7   laboratory using 100-megabit-per-second networking using your
   8   view, the "absolute best case possible scenario"; correct?
   9   A.  That's correct.
  10   Q.  You're aware, are you not, that the new Abilene network
  11   that has been developed for major universities is running at
  12   2.4 gigabits-per-second speeds?
  13   A.  That speed is not what you can attain in between
  14   individual computers, however.
  15   Q.  No, but it is the new state of the art used at
  16   universities rather than 100-megabit-per-second network;
  17   correct?
  18   A.  I don't think it's used at any university other than
  19   Abilene and its partners, so.
  20   Q.  Do you have any idea who those partners are now?
  21   A.  I do not.
  22   Q.  Does 37 sound about right to you?
  23   A.  I do not have an idea.
  24            MR. COOPER:  No further questions, your Honor.
  25            THE COURT:  Let me follow up on one thing.
                                                                1033
   1            In the supplement to your declaration, you list in
   2   the source computer several of the components, including SCSI
   3   busts?
   4            THE WITNESS:  That's correct.
   5            THE COURT:  And what I take to be the hard disks,
   6   both the system and the data disks have 40-megabyte-per-second
   7   transfer rates.  Are there faster components for those
   8   functions?  Are there faster SCSI busts and hard drives?
   9            THE WITNESS:  There are.
  10            THE COURT:  How much faster?
  11            THE WITNESS:  The fastest SCSI bust I've actually
  12   seen was on a very expensive computer and we are not talking
  13   actually about technology that's limited by the speed of the
  14   disks, but rather by the speed of the controller that uses
  15   several disks to increase speed and that was 80 megabytes per
  16   second.
  17            THE COURT:  And these components that are rated at
  18   40-megabytes components that limit the speed of the transfers
  19   in your tests?
  20            THE WITNESS:  40 megabytes per second is still much
  21   faster than 100 megabits per second.  So, I would say no.
  22            THE COURT:  All right.  Mr. Hernstadt, anything else?
  23            MR. HERNSTADT:  A couple of questions, your Honor.
  24   REDIRECT EXAMINATION
  25   BY MR. HERNSTADT:
                                                                1034
   1   Q.  Mr. Craig, Mr. Cooper asked you about the speeds that you
   2   created.  Did you create any transfer speeds in the experiment
   3   contained or described in your declaration?
   4   A.  I used what was available to me in a typical large local
   5   area network installation with a lot of high-speed networking.
   6   I did not specifically create any connection speeds with the
   7   exception of, I think it was 4B, where in order to simulate a
   8   slower network, I set a port on a switch to negotiate at 10
   9   megabits per second, rather than 100.
  10            MR. HERNSTADT:  Thank you very much, Mr. Craig.
  11            I have nothing further, your Honor.
  12            THE COURT:  Mr. Cooper?
  13            MR. COOPER:  Nothing further, your Honor.
  14            THE COURT:  Thank you, Mr. Craig.
  15            (Witness excused)
  16            THE COURT:  Next witness, please?
  17            (Continued on next page)
  18
  19
  20
  21
  22
  23
  24
  25
                                                                1035
   1    MICHAEL EINHORN,
   2        called as a witness by the Defendant,
   3        having been duly sworn, testified as follows:
   4   DIRECT EXAMINATION
   5   BY MR. GARBUS:
   6   Q.  Mr. Einhorn, describe your educational background.
   7   A.  I received a BA in economics summa cum laude from
   8   Dartmouth in 1974 and a Ph.D. from Yale University in 1981 in
   9   economics.
  10   Q.  Did you also receive a masters from Yale?
  11   A.  In 1976.
  12   Q.  And can you tell me something about your work background.
  13   A.  Since receiving my Ph.D., I worked at Bell Laboratories as
  14   a member of their technical staff.  I've been Assistant
  15   Professor at Rutgers University.  I worked for six and a half
  16   years in the Antitrust Division of the U.S. Department of
  17   Justice, and two years, two and a half years at Broadcast
  18   Music, Incorporated.
  19            I'm now a research fellow at Columbia University, and
  20   I'll be joining the faculty as a visiting professor of William
  21   Patterson University, which is a school in New Jersey that has
  22   a music management department, the only one of three in the
  23   U.S., and I am negotiating as an adjunct at Columbia this year
  24   as well.
  25   Q.  Have you ever testified in a court before?
                                                                1036
   1   A.  No, just in small claims court.
   2   Q.  Are you being compensated for your work?
   3   A.  I'm working pro bono.
   4            THE COURT:  We're not going to go into that.
   5   Q.  You're not an expert in small claims.  Okay.  You work for
   6   pro bono.  Can you tell me something about your publications.
   7   A.  I published, I think, about -- I didn't count them up --
   8   maybe 40 to 50 publications.  My areas of specialty generally
   9   can be called applied microeconomics.  Microeconomics can deal
  10   with a number of issues, including public utility regulation,
  11   antitrust, general market conditions, and intellectual
  12   property.  I have either published in or spoken in or
  13   submitted papers in all of those areas.
  14   Q.  Can you tell me what materials you have read prior to your
  15   testimony here today concerning the issues in this case?
  16   A.  Most importantly, I've read a number of declarations.
  17   I've read Franklin Fisher's deposition.  I read Franklin
  18   Fisher's declaration.  I've done a thorough literal search of
  19   all the articles bearing on the topics of copying and piracy.
  20            I visited the website of Charles River Associates.  I
  21   went to the Department of Justice and looked through their
  22   antitrust guidelines on intellectual property, and I read a
  23   number of Law Review articles that I felt were related to
  24   copyright.
  25   Q.  Have you done any independent empirical studies on your
                                                                1037
   1   own with respect to DVDs or the loss of sales, any particular
   2   studies since we've actually come into this case?
   3   A.  I've done no empirical studies.
   4   Q.  You mentioned Charles River Associates.  Can you give me
   5   some of the names of people whose articles you have read?
   6   A.  In particular, in the course of my involvement in
   7   intellectual property, there were three people in the course
   8   of my career whom I became aware of at Charles River
   9   Associates and who are personal associates of mine,
  10   professional associates of mine who work in the area of
  11   intellectual property.
  12            Those three people are Stanley Besen, John Woodbury
  13   and Steve Salop.  S-a-l-o-p.  Besen, B-e-s-e-n.  Besen, in
  14   particular, is described by Charles River Associates as a
  15   nationally renowned expert on intellecutal property on their
  16   website.
  17   Q.  And you know that Mr. Fisher is with Charles River
  18   Associates?
  19   A.  He is the chairman.
  20   Q.  Have you read articles by any of those three?
  21   A.  In particular, Mr. Besen.  I've also read one by
  22   Mr. Solomon a while ago, but Mr. Besen -- when I said I did a
  23   literal search on the topic of copying in piracy, I didn't
  24   survey all the articles that could have been written by the
  25   Charles River people on this topic.  I stayed specifically
                                                                1038
   1   within the area of copying and piracy and found two that
   2   Mr. Besen had his name on.  I'm sorry.  Conceivably three.
   3   Q.  Let me just ask you, I'm going to read to you a sentence
   4   from the Fisher affidavit and I ask you to comment on it and
   5   give us your opinion on it.
   6            It's paragraph 8.  It says: "The availability of
   7   unauthorized copies of feature length films on the Internet
   8   would have a considerable, negative financial and market
   9   impact on the major motion picture companies."  May I have
  10   your opinion on that?
  11   A.  If that availability were made free of charge, with equal
  12   quality and equal amount of time necessary, there could be
  13   truth to that, but the comment, as it relates to this case, is
  14   entirely hypothetical because he's ignoring issues that are
  15   very much related to the kind of unauthorized reproduction
  16   that we're talking about here.
  17   Q.  And what are these other issues?
  18   A.  Well, in particular, I measure three.  Number one is
  19   quality.  He doesn't own up to the possibility that the kind
  20   of DiVX downloads that we're talking about will be far
  21   inferior to the DVD movies that one can get with high
  22   definition.  That's number one.
  23            Number two is he ignores the time that's required to
  24   make these DVDs pirated moves.  There are two issues in time
  25   that I see.  First of all, as Mr. Shamos has pointed out to
                                                                1039
   1   us, one has to go about in the current market now preparing a
   2   DiVX to trade with somebody else.  That takes a certain amount
   3   of investment in one's time to put that trading material
   4   together.
   5            But more important right now, if a DVD has,
   6   hypothetically, 6 gigabytes on it, which I'm led to believe is
   7   the reasonable size of a DVD right now, and one has a 56
   8   kilobit modem, which is what maybe 90 to 95 percent of the
   9   population has right now, it will take you over 200 hours to
  10   download a DVD onto your hard drive.  Finally, a hard drive
  11   only has -- my hard drive only has 28 gegabits, and a DVD has
  12   up to 6 or 8.  That's taking up an awful lot of hard drive.
  13            Or another issue related to this that Mr. Fisher
  14   doesn't talk about are the costs.  If you decide to put it
  15   onto a blank DVD, right now the cost of a blank DVD exceed
  16   those -- the necessary tape requirements and the cost of that
  17   blank tape exceed the costs of buying the tape flat out.  It's
  18   cheaper for me just to buy the tape with the movie on it.
  19            furthermore, the minimum -- from the testimony I've
  20   read about and heard about, the minimum cost of a burner,
  21   which is necessary to burn the movie into a blank DVD, is
  22   $500.  That's Mr. Shamos saying that.  Someone else testified
  23   at $5,000.
  24            So there are three major issues.  There's a bad
  25   quality.  There's the amount of time that it takes, and
                                                                1040
   1   there's the cost of the equipment.
   2            THE COURT:  Did you ever look at a movie that was
   3   decrypted with DeCSS?
   4            THE WITNESS:  I have not.
   5            THE COURT:  You're the expert on quality?  Go ahead,
   6   Mr. Garbus.
   7            MR. GARBUS:  He didn't say that at all.  He said
   8   quality is a factor.  He didn't say he was an expert on
   9   quality, and he wasn't produced as an expert on quality.
  10            THE COURT:  Do you have any more questions, Mr.
  11   Garbus?
  12   BY MR. GARBUS:
  13   Q.  What does Mr. Besen say, if you recall, of the overall
  14   effect of copying on sales?
  15            MR. SIMS:  Objection.
  16            THE COURT:  Sustained.
  17   Q.  Are there any other factors to take into account?  Did you
  18   read the affidavit of Mr. Kurlantzick?
  19            MR. SIMS:  Objection.  Which question is he asking
  20   for an answer to?
  21            THE COURT:  Sustained as to form.
  22   Q.  Did you read the affidavit of Mr. Kurlantzick?
  23   A.  I read the affidavit of Mr. Kurlantzick.
  24   Q.  And do you have an opinion with respect to it?
  25            MR. SIMS:  Objection.
                                                                1041
   1            THE COURT:  Sustained.
   2   Q.  Let me show you the affidavit of Mr. Kurlantzick, and I
   3   address your attention to paragraphs 3 and 4 of the affidavit.
   4            THE COURT:  What exhibit is this?
   5            MR. SIMS:  It's not an exhibit, your Honor, that I'm
   6   aware of.  Mr. Kurlantzick was offered by them in pretrial
   7   proceedings for deposition.  We took his deposition, and we've
   8   heard no more.
   9            MR. GARBUS:  Your Honor, that's not so.  We heard
  10   Mr. Fisher being cross-examined on Mr. Kurlantzick's
  11   affidavit.
  12            THE COURT:  Mr. Garbus, if you have a question,
  13   please put it.
  14   BY MR. GARBUS:
  15   Q.  I show you paragraphs 3 and 4 of Mr. Kurlantzick's
  16   affidavit, and I ask you whether or not you agree or disagree
  17   with the opinions expressed therein?
  18            THE COURT:  Objection sustained.  If you want to ask
  19   him for his opinion, ask him for his opinion, but not about
  20   somebody else's article or somebody else's affidavit in this
  21   way.  There is a hearsay rule, Mr. Garbus.  If you wanted to
  22   call Mr. Kurlantzick, you should have called Mr. Kurlantzick.
  23            MR. GARBUS:  Your Honor, we had a discussion during
  24   Mr. Fisher's examination, and they wanted to ask questions off
  25   the Kurlantzick affidavit, and they asked questions off the
                                                                1042
   1   Kurlantzick affidavit.  There was dialogue there about that,
   2   and he was permitted to do it.
   3            THE COURT:  Mr. Garbus, I'm not stopping you from
   4   asking this witness questions about opinions he may have
   5   formed concerning issues relevant in the case.
   6   BY MR. GARBUS:
   7   Q.  Do you have an opinion on the question of positing
   8   one-to-one ratios between acts of copying and displaced sales?
   9   A.  Yes, I do.
  10   Q.  What is that opinion?
  11   A.  I think it is theoretically unjustified by economic theory
  12   to suggest that there is a one-to-one relationship between a
  13   sale of a good at hypothetically zero price and a displacement
  14   of a "legitimate" good at a higher price.
  15   Q.  And can you tell me how this, in your opinion, applies to
  16   the whole question of DVDs?
  17            MR. SIMS:  Objection.
  18            THE COURT:  Overruled.
  19   A.  There are two things that one must consider in the DVD
  20   issue.  First of all, one must identify the costs associated
  21   with using the DVD.  That's issue number one.
  22            And number two, if, indeed, DVDs are determined to
  23   have lower prices than legitimate movies or original movies,
  24   then one must also recognize that many of the sales of DVDs
  25   that take place at hypothetically -- hypothetically zero
                                                                1043
   1   dollars or one dollar would not have ensued at a higher price
   2   of $25.
   3            That's what the one-to-one -- that's why the
   4   one-to-one rule is not a theoretically justified rule because
   5   there is no direct correspondence.
   6   Q.  Can you tell me what the impact of the rental DVD is on
   7   this?
   8   A.  Yeah; I certainly shall.  What happens now in the United
   9   States is most of the home video market, of course, is video
  10   cassettes.  I'd say in the U.S. last year consumers spent
  11   about $41 billion on movies, on watching movies on television,
  12   the box office and from video cassettes and DVDs.
  13            Of that $41 billion, about $18 billion was spent on
  14   video cassettes and a small $1 billion was spent on DVDs.  In
  15   that video cassette market, over half, 60 percent, was spent
  16   on rentals.  What happens, as we know, is rentals are the main
  17   factor in the video cassette market.
  18            What I'm surprised at -- what we need to do is
  19   establish if there's going to be piracy or illegitimate
  20   copying, we have to consider that the pirate or the copier is
  21   going to consider all the costs of alternative ways of getting
  22   his or her hands on the movie.  This includes not only buying
  23   a DVD at $25.
  24            It will include -- as we have the build-out of the
  25   DVD players that right now are not yet built-out, it will
                                                                1044
   1   include in the infrastructure, also, the rental industry.
   2            Right now, the average video cassette in the U.S.
   3   last year rented for $2.78.  So if I want, I can go into
   4   Blockbuster, my Blockbuster, on Monday, Tuesday and Wednesday
   5   and get two movies or the price of one.  So you may be talking
   6   here about $1.39.  Furthermore, the price of video cassettes,
   7   the real price of video cassettes has fallen -- real price,
   8   adjusted for CPI -- has fallen 25 percent -- this is for
   9   rentals -- for rentals has fallen 25 percent since 1986.
  10            MR. SIMS:  Objection.  Move to strike.  Lack of
  11   foundation.
  12            THE COURT:  Overruled.
  13   Q.  Go ahead.
  14            THE COURT:  Mr. Garbus, your previous point on
  15   reviewing my notes was well taken.  I did allow the other side
  16   to ask a question on Kurlantzick's affidavit because you said
  17   you would call substantially equivalent testimony.  If you
  18   want to do so, you may do so.
  19            THE WITNESS:  Can I answer?
  20            THE COURT:  I thought you were finished.
  21            THE WITNESS:  I'd like to go a little more if I may.
  22   I'm almost done.
  23   BY MR. GARBUS:
  24   Q.  Go ahead, sir.
  25   A.  So what we have to do here is consider when people talk of
                                                                1045
   1   piracy and when this is going to take place, hypothetically
   2   five years out into the future when everyone has got the broad
   3   band equivalent of what they don't have now at their modem,
   4   five years from the future, anyone who wants to pirate is
   5   going to have the opportunity to go in and making my
   6   projections, I'd say buy that -- they can go in and rent a
   7   DVD.  If they can get a video cassette now at $2.78, okay, and
   8   that rate is falling over real time due to -- because it
   9   doesn't keep up with inflation, it's conceivable they can get
  10   this thing for about two bucks.
  11            So if you want to talk about piracy, let's just bear
  12   in mind there's another kind of technology out there that
  13   hasn't even been mentioned by Mr. Fisher or anybody whose
  14   declaration that I have read, and that is, is this piracy
  15   going to be cost effective to people who can go to video
  16   stores and pop these movies for five days for two bucks.
  17   Q.  Let me ask you this.  I want you to assume -- and this is
  18   very obvious -- that there are Linux operating systems that
  19   also could use DVDs.  Does that widen the market for DVDs?
  20   A.  Yes, it does.
  21   Q.  And what are the possible consequences of that?
  22   A.  The very important thing to recognize about the video
  23   cassette market, the home rental market over the past 12 years
  24   is that it has been driven by the growth, the saturation, the
  25   penetration of the video cassette recorder at home.  And I've
                                                                1046
   1   got some numbers here that will substantiate that.
   2   Q.  Tell us what they are.
   3   A.  Okay.  Remember I said that the rental price has fallen in
   4   real terms 25 percent since 1986.  That's the rental price.
   5            The sale price of a video cassette has fallen since
   6   1986 by 60 percent.  Despite the fact the real rental price
   7   has fallen and the real sale price -- by "real" I mean
   8   consumer price index adjusted.  Despite the fact that both of
   9   those sales prices have fallen, total spending in the video
  10   cassette market has gone up by over 200 percent.
  11            Why?  Because the VCR has built out.  We've gone up
  12   from 30 million homes to 85.9 million homes.  What is
  13   happening here is the American consumer buys the VCR, and the
  14   reason why they keep buying the VCR is because there's a
  15   build-out of cheaper movies for them to get their hands on and
  16   more movies to get their hands on.
  17            And by enabling people to get their hands on movies
  18   that are falling in price and more and more movies, the VC
  19   market has grown out because of the growth -- I'm sorry, the
  20   video cassette market has grown out because of the increased
  21   penetration of the VCR.
  22   Q.  And what is the benefit to the consumers if you have,
  23   let's say, Linux players out there playing DVDs that people
  24   purchase?
  25            MR. SIMS:  Objection; irrelevant.
                                                                1047
   1            THE COURT:  Sustained.
   2   Q.  Do you have any opinion on what the effect would be on the
   3   price of DVDs if Linux players were out there?
   4            MR. SIMS:  Objection, your Honor.  Irrelevant.
   5            THE COURT:  Sustained.
   6   Q.  Now, have you looked at the Microsoft decision in the
   7   Microsoft case?
   8   A.  I have looked at it.
   9   Q.  And do you have any opinion between the question of the
  10   strength of an operating system and the availability of
  11   applications and its consumer period?  Go ahead.
  12            MR. SIMS:  Objection.
  13            THE COURT:  Sustained.
  14   Q.  Do you have any experience or any knowledge of the
  15   relationship between anything you had at the Department of
  16   Justice, between the strength of an operating system and the
  17   availability of application?
  18            MR. SIMS:  Objection.
  19            THE COURT:  Sustained.
  20   Q.  Now, can you tell me any other benefits that you can see
  21   from consumers having an open-source system such as Linux?
  22            MR. SIMS:  Objection.
  23            THE COURT:  Sustained.
  24            MR. GARBUS:  I think I may be through, your Honor.
  25   Thank you very much.
                                                                1048
   1            THE COURT:  Thank you, Mr. Garbus.  Mr. Sims.
   2            MR. SIMS:  Your Honor, can we take a mid-morning
   3   break now.
   4            THE COURT:  All right.  15 minutes.
   5            THE DEPUTY CLERK:  All rise.
   6            (Recess)
   7            (In open court)
   8            THE COURT:  Okay, Mr. Sims, cross-examination.
   9            MR. SIMS:  Thank you, Judge.
  10   CROSS-EXAMINATION
  11   BY MR. SIMS:
  12   Q.  Professor Einhorn, BMI recently severed your employment,
  13   correct?
  14   A.  Correct.
  15   Q.  Except for working on a single matter involving a radio
  16   company merger, you have no experience in the entertainment
  17   issues, correct?
  18   A.  I think when I worked at BMI, I worked for two and a half
  19   years in the entertainment industry.
  20   Q.  Anything related to video, home video market at BMI?
  21   A.  At BMI, no.
  22            THE COURT:  I'm sorry.  Was it BMI that fired you or
  23   was it EMI?
  24            THE WITNESS:  BMI.
  25            THE COURT:  BMI.  I know the difference.
                                                                1049
   1   BY MR. SIMS:
   2   Q.  And your present employment as an economist is limited to
   3   a one-year terminal position at the Patterson State University
   4   in New Jersey as an adjunct visiting professor?
   5   A.  I'm also doing some private consulting work at the same
   6   time now.
   7   Q.  You've never taught any course relating to copyright?
   8   A.  Relating to copyright?
   9   Q.  Yes.
  10   A.  Specifically copyright, no, I have not.
  11   Q.  Or any course involving markets where the marginal cost of
  12   an additional copy is essentially zero?
  13   A.  I've taught courses in applied microeconomics, and I've
  14   taught them for seven years.  In particular -- wait, if I may
  15   finish.  In the course of teaching applied microeconomics,
  16   I've taught the theory of public goods.  In the theory of
  17   public goods, many of the issues that are discussed in the
  18   theory of public good is the fact that the marginal cost of
  19   using a public good can be zero.
  20            I have not taught a course specifically on copyright,
  21   but the issue of marginal cost being equal to zero comes up in
  22   a standard applied microeconomics course, which I have taught
  23   for seven years.
  24   Q.  Is it your view, Mr. Einhorn, that motion pictures created
  25   by the plaintiffs are public goods?
                                                                1050
   1   A.  No; they are not.
   2   Q.  Okay.  Thank you.  Now, you made no study of consumer
   3   behavior in connection with this matter, correct?
   4   A.  I have yesterday reviewed some data on consumer behavior
   5   in the video cassette market.  I do not have, at this point,
   6   enough information in my hands to study consumer behavior in
   7   the DVD market.
   8   Q.  You would agree with me, sir, that your ability as an
   9   economist doesn't help you at all in assessing the likelihood
  10   that DeCSS on defendants' website may lead to copying of
  11   plaintiffs' motion pictures from DVDs?
  12   A.  I am an economist, and I do not purport to understand the
  13   workings -- the technical workings of DeCSS.  I can only point
  14   out the factors that should be considered to make an economic
  15   decision.
  16   Q.  So the answer to my question is yes?
  17   A.  Yes.
  18   Q.  Now, are you aware of Steven King's recent decision to put
  19   a novella on the Internet on -- strike that.  Are you aware
  20   of Steven King and Simon and Shuster's experiment earlier this
  21   year in delivering a Steven King Gnutella over the Internet?
  22            MR. GARBUS:  Objection.
  23            THE COURT:  Where is this going, Mr. Sims?
  24            MR. SIMS:  I'm asking him since he opined on what he
  25   sees as a reason to or not to copy, whether he is aware of
                                                                1051
   1   Mr. King's objection on television that he was amazed that
   2   lots of hackers spent 48 hours trying to hack into a system in
   3   which his novel was available for $2.50.
   4            THE COURT:  Sustained.
   5            MR. GARBUS:  Sorry Mr. Sims wasn't under oath for
   6   that.
   7            THE COURT:  We can do without those comments.
   8            MR. GARBUS:  I'm sorry.  I apologize.
   9   BY MR. SIMS:
  10   Q.  Mr. Einhorn, you testified, I think, that you saw no
  11   one-to-one relationship between copying and sales
  12   displacement, correct?
  13   A.  That's correct.
  14   Q.  You would agree though, wouldn't you, that the motion
  15   pictures studio's development of a market on the net for
  16   digital delivery of their own motion pictures may be thwarted
  17   by the presence of unauthorized reduced-costs product?
  18   A.  I'm sorry.  Can you repeat the question again, please.
  19   Q.  Yes.  You would agree, wouldn't you, that the motion
  20   picture studio's development of a market on the Internet for
  21   digital delivery of their own motion pictures will be thwarted
  22   by the presence of unauthorized reduced-costs product?
  23            MR. GARBUS:  I object to the question.  "Will be
  24   thwarted" is speculative.
  25            THE COURT:  In that form, yes.  Sustained.
                                                                1052
   1   Q.  You would agree, wouldn't you, sir, that the motion
   2   picture studio's development of a market on the net for
   3   digital delivery of their motion pictures may be thwarted by
   4   the presence of unauthorized reduced-costs product?
   5            MR. GARBUS:  I object to it.
   6            THE COURT:  Sustained as to form.  Why don't you try
   7   may be affected adversely.
   8   Q.  Would you agree, sir, that the motion pictures studio's
   9   development of a market on The internet for digital
  10   delivery --
  11            MR. GARBUS:  I think I would object to it unless it
  12   was the same market.
  13            THE COURT:  I don't understand your objection, sir.
  14            MR. GARBUS:  As I understand the question we're not
  15   talking about DVDs.  We're talking about delivery of movies on
  16   the Internet.  It's a different market.
  17            THE COURT:  Overruled.
  18   BY MR. SIMS:
  19   Q.  Do you understand the question, Mr. Einhorn?
  20   A.  No, I'm sorry, because -- please repeat it.
  21   Q.  I'll do it again.  You would agree, wouldn't you, that the
  22   motion picture studio's development of a market on the net for
  23   digital delivery of their motion pictures may be adversely
  24   impacted by the presence of unauthorized reduced-costs
  25   product?
                                                                1053
   1   A.  There's a very important word -- there's a very important
   2   word you used there, "reduced costs."  It's essential that we
   3   understand that when I answer your question here, I'm talking
   4   here about a hypothetical market where costs are, indeed,
   5   reduced.
   6            Now, I would agree that if there were a reduced --
   7   reduced-cost technology that is able to offer movie content at
   8   reduced costs, I would agree that could adversely affect the
   9   studios.  However, the measurement of costs is a very serious
  10   matter in economics.  In fact, that's our bread and butter.
  11   Economics is a science of benefits and costs accurately
  12   measuring each and determining an optimum position that trades
  13   them off.  All costs must be considered if we're applying your
  14   paradigm to any one market.
  15   Q.  Let me turn to page 84 of your deposition taken last week.
  16   A.  I'm going to need to see it because I don't have it in
  17   front of me.
  18   Q.  I'll read the following question and answer:
  19   "Q.  As a matter of economic theory, do you agree with the
  20   statement made in paragraph 9 of the Fisher declaration that
  21   any expectation that the film companies have to develop a
  22   legitimate market on the Internet for the delivery of their
  23   films will be significantly thwarted by the presence of
  24   unauthorized product available at little or no charge to the
  25   consumer?"
                                                                1054
   1            An objection from Mr. Hernstadt to form and
   2   foundation.
   3   "A.  I'd rather say could instead of will.  I think there is
   4   certainly a possibility that is true."
   5            Was that testimony truthful, sir?
   6   A.  You have reflected what I said on the issue.
   7   Q.  Now, from the viewpoint of economic theory as you
   8   understand it, am I correct that the availability over the
   9   Internet of unauthorized decrypted copies of a blockbuster
  10   like Matrix would likely adversely impact the revenues for
  11   that film?
  12   A.  This is a question that was asked at the deposition, and
  13   it's very essential and important for me to understand what
  14   "over the Internet" means, okay.  When we talk about "over the
  15   Internet," let me -- when I hear the words "over the
  16   Internet," how I imagine what that phrase could mean is a
  17   realtime streaming application that is scheduled.  So that at
  18   9 o'clock in the evening on Sunday evening, I could go, read
  19   my video guide or whatever I read for my movies, and
  20   understand that at 9 o'clock, I will get a streamed, realtime
  21   movie that will show me the Matrix.
  22            And in that instance, I would agree that if someone
  23   can stream that movie at me, that can conceivably displace
  24   other sales of that movie.  But while we talk about over the
  25   Internet, once again, like everything else, we need some
                                                                1055
   1   specificity.  Realtime streaming is not the same thing as
   2   downloading, and down loading in an hour is not the same thing
   3   as downloading at 300 hours.
   4            So what I'm asking for me is some specificity.  In
   5   the abstract, I agree.  In the abstract, I would agree that
   6   movies over the Internet -- and what I'm thinking about here
   7   is realtime streaming -- present that danger.  I shouldn't say
   8   danger because I think the movie studios will be doing it
   9   themselves, but would present that issue of -- of an
  10   application that could lead people to say, look, we don't have
  11   to bother to go to the theatre because at 9 o'clock, it's on
  12   tonight, and it's on in the same full quality that we have
  13   right now.
  14   Q.  And do you believe, sir, that the impact, adverse impact
  15   on blockbusters like Matrix would be seen in the box office,
  16   as well as in the home video market?  Correct?
  17   A.  Once again, we're talk about hypothetical.  I would agree
  18   that movies over the Internet, in certain formats, could
  19   affect blockbuster sales in the movie theatre or at the -- in
  20   any number of different windows.  Movies over the Internet
  21   being taken to mean, as I said, a realtime streaming
  22   technology.
  23   Q.  Now, finally, your testimony on direct, as I understand
  24   it, is that as a matter of economics, you don't see why there
  25   would be a market for DVD piracy when it's pretty cheap to
                                                                1056
   1   rent a DVD?  Is that essentially what you were testifying to?
   2   A.  I didn't say that.
   3            THE COURT:  The witness can answer.
   4   A.  I didn't say that.  What I said is this, I said to do an
   5   economic analysis -- and this point has been sustained in
   6   economic research for the past 15 years.  It's been said by a
   7   number of researchers, and it's been said by Stan Besen in
   8   print, okay.  I read through this literature, and I saw what
   9   other economists say.
  10            What economists say is you've got to do lots of
  11   research.  You have to understand the facts.  You've got to
  12   understand the nature of technology.  You've got to understand
  13   quality.  You've got to understand time, okay.  Now, in the
  14   course of these things, in understanding them, certain
  15   outcomes can go one way or the other, but you've --
  16            I'm sorry.  Can you -- I missed the second half of
  17   your question.
  18            MR. SIMS:  Can you reread the question, please.
  19            (Record read)
  20   A.  Thank you so much.  I'm not making any predictions about
  21   piracy or not.  What I'm calling for here is some kind of
  22   evidence to go beyond a step.  I can't even talk about that
  23   stuff because I haven't seen anything that would meet the
  24   criterion that my profession has established as necessary
  25   criterion to analyze piracy and copyright issues.
                                                                1057
   1   Q.  Now, you came out earlier with many statistics.  What's
   2   the cost, as you understand it, of renting a VHS from a store
   3   like Blockbuster?
   4   A.  My understanding right now is that 95 percent -- by VHS,
   5   you mean --
   6   Q.  VHS, a video cassette from Blockbuster.  How much does it
   7   cost to rent?
   8   A.  The average is $2.78.
   9   Q.  And are you aware of the size of the market for video
  10   cassette piracy in the United States?
  11   A.  No, I'm not.
  12   Q.  Do you believe, sir, that individuals want to possess
  13   copies of films in various formats and not merely see them
  14   streaming?
  15            MR. GARBUS:  I object to this.
  16            THE COURT:  Pardon me.
  17            MR. GARBUS:  I object.
  18            THE COURT:  Sustained.
  19            MR. SIMS:  No more questions, your Honor.
  20   REDIRECT EXAMINATION
  21   BY MR. GARBUS:
  22   Q.  I'll just ask two questions, and that is whether or not
  23   you have an opinion on whether the availability of movies on
  24   videotape has an adverse impact on revenues?
  25   A.  On videotape?
                                                                1058
   1   Q.  Whether VCRs have an adverse impact on revenues.
   2            MR. SIMS:  Objection.
   3   Q.  Do you know one way or the other?
   4            THE COURT:  Let's find out if he has an opinion
   5   first.
   6   A.  Okay, I don't know of any research one way or the other.
   7   Because these things come later, the question is to what
   8   degree are there people who will move from going to the movie
   9   theatre and instead say, look, I'm not going to go to the
  10   theatre, I'm going to wait 26 weeks or 39 weeks, and I'm going
  11   to wait for them at Blockbuster.  Personally I do that, okay,
  12   but that's just one person.
  13   Q.  Do you know whether the movie companies presently make
  14   more monies on VCR or DVDs than off theatre revenues?
  15   A.  Yes, they do.  I'll repeat.  Let me give you numbers.
  16   These are not necessarily for American studios.  In 1999, the
  17   American consumer spent $41 billion on movies.  Those being
  18   combined over cable, home video, and the box office.  Of that
  19   $41 billion, I'd say $19 billion is spent in the home market.
  20            About $7 billion, $8 billion -- I'm going to miss
  21   some numbers here because I'm not rounding off correctly, but
  22   $8 billion is spent at the box office, and the remaining 13 or
  23   $14 billion is spent on cable, and cable, of course, subsumes
  24   a number of different applications.  The biggest single market
  25   now in the U.S. for movies is the home video market.  Of
                                                                1059
   1   course, there are some home videos -- and most of that is
   2   right now video cassette, and most of the video cassette
   3   market is the rental market.
   4            This is why it's essential.  If you're going to talk
   5   about whether piracy really has an economic meaning is to talk
   6   about the other technologies that a consumer can have to
   7   pirate.  And that particular technology is, hey, for two
   8   bucks, you can go to Blockbuster, and for 3 bucks or 4 bucks,
   9   Cosmo will deliver it to you within an hour.  If you want to
  10   pirate, take 250 hours to download a DVD, it's your life.
  11   Q.  Can you tell me the difference between piracy relating
  12   to -- you read about the Napster case -- piracy with respect
  13   to audio and piracy with respect to DVDs?
  14            MR. SIMS:  Objection; beyond the scope of cross.
  15            THE COURT:  Sustained.
  16            MR. GARBUS:  I have no further questions.
  17            THE COURT:  What's the source of the revenue dollars
  18   you just gave us, sir?
  19            THE WITNESS:  I'm sorry.  That was from a book by --
  20   it's an annual report published by an investment banking firm
  21   named Verona Suller, Incorporated.  Every year they put out an
  22   annual report of --
  23            THE COURT:  This is not something that's within your
  24   area of expertise.  You're just relating what you read
  25   somewhere.
                                                                1060
   1            THE WITNESS:  No.  As a matter of fact, I worked on
   2   the annual report this year.
   3            THE COURT:  And what did you do that produced these
   4   numbers?
   5            THE WITNESS:  I'm sorry.  The numbers that I'm
   6   reporting here were taken from other trade publications by
   7   research analysts those trade publications include --
   8            THE COURT:  Okay.  I understand.  Thank you.
   9            MR. GARBUS:  Thank you for your testimony.
  10            (Witness excused)
  11            THE COURT:  Your next witness, please.
  12            MR. GARBUS:  I think we'll be finished by lunch with
  13   our witnesses.
  14            THE COURT:  Mr. Sims, I hope you're ready to go after
  15   lunch.
  16            MR. ATLAS:  Defendants call Dr. David Touretzky.
  17            MR. GARBUS:  If I could say something.  I didn't know
  18   there was going to be any rebuttal case.
  19            THE COURT:  Well, on Friday we discussed this, and
  20   they indicated that they might do so.  That's all I know.
  21            MR. SIMS:  Actually, I spoke to Ed Hernstadt last
  22   night, probably at 11 o'clock, and we said we weren't certain
  23   we might have a witness, and if so, we would present him for
  24   deposition.  We haven't yet decided.  We wanted to see this
  25   morning's witnesses before we decided.
                                                                1061
   1            THE COURT:  Okay.  Let's proceed.
   2    DAVID TOURETZKY,
   3        called as a witness by the Defendant,
   4        having been duly sworn, testified as follows:
   5            THE COURT:  Proceed, Mr. Atlas.
   6   DIRECT EXAMINATION
   7   BY MR. ATLAS:
   8   Q.  Good morning, Doctor.  Can you tell us by whom you are
   9   presently employed?
  10   A.  Carnegie Mellon University in Pittsburgh, Pennsylvania.
  11   Q.  And what do you do at Carnegie Mellon?
  12   A.  I do research and teaching computer science.
  13   Q.  Do you teach in any specialized area within the field of
  14   computer science?
  15   A.  Artificial intelligence and computational neuroscience.
  16   Q.  Can you just describe briefly those areas in a little bit
  17   greater detail?
  18   A.  Artificial intelligence is concerned with getting
  19   computers to do things that normally require human-like
  20   intelligence or animal-like sense.  Computational neuroscience
  21   is the use of computers to understand how brains work.
  22   Q.  And how long have you taught computer science at Carnegie
  23   Mellon?
  24   A.  I've been on the faculty since 1984.
  25   Q.  Can you tell us what degrees you have and from which
                                                                1062
   1   schools you obtained them?
   2   A.  I have a bachelors degree in computer science from Rutgers
   3   University, and I have a masters and Ph.D. degree in computer
   4   science from Carnegie Mellon.
   5   Q.  Do you serve on any boards?
   6   A.  I serve on several editorial boards:  The Editorial Board
   7   of Cognitive Science.  It's a journal.  The Editorial Board of
   8   Neuro-Computation.  I'm also on the board of directors of
   9   NIPS.  NIPS stands for neural information processing systems.
  10   It's a foundation that manages an annual conference for
  11   researchers in the field of neuro-networks.
  12   Q.  Have you published any books?
  13   A.  Yes.  I've published three books.
  14   Q.  Have you published any articles?
  15   A.  Approximately two dozen journal articles and about 60
  16   conference papers.
  17            MR. ATLAS:  May I approach, your Honor?
  18            THE COURT:  Yes.
  19   Q.  I'd like to show the witness what we've marked as
  20   Defendants' Exhibit CCM, and if you could tell us what that
  21   is.
  22   A.  This is a copy of my curriculum vitae as of,
  23   approximately, April of this year.
  24   Q.  Are there any changes to your CV that are not reflected on
  25   the April version?
                                                                1063
   1   A.  There are a few changes, a few articles that were listed
   2   and perhaps now have page numbers.  And I've added two items
   3   to the CV that are relevant to this case.  I now cite my
   4   Gallery of CSS Descramblers as a publication and also a page
   5   on the CSS descrambling algorithms.  That's now included in my
   6   vitae as a publication.
   7            MR. ATLAS:  If I may approach again.  I'd like to
   8   move Dr. Touretzky's CV into evidence.
   9            THE COURT:  Any objection, Mr. Mervis?
  10            MR. MERVIS:  Plaintiffs have no objection, your
  11   Honor.
  12            MR. ATLAS:  If I may approach again, your Honor.
  13            THE COURT:  Go ahead.
  14   BY MR. ATLAS:
  15   Q.  Dr. Touretzky, did you prepare a declaration in this case?
  16   A.  Yes, I did.
  17   Q.  I'd like to show the witness what we've marked as
  18   Defendants' Exhibit BBC and ask the witness if that's the
  19   declaration that you prepared and signed in this case?
  20   A.  Yes, it is.
  21            MR. ATLAS:  I'd like to move Dr. Touretzky's
  22   declaration into evidence as well, your Honor.
  23            MR. MERVIS:  Your Honor, I suppose to the extent that
  24   this won't help illustrate his testimony, I have an objection,
  25   which is -- and it may be premature -- which is that the
                                                                1064
   1   testimony is going to be cumulative from what you heard from
   2   Dr. Felton.
   3            Notwithstanding that, your Honor, I do have an
   4   objection in specific to paragraph 7 of this declaration.  The
   5   grounds for that objection are as follows:  Relevance,
   6   hearsay, best evidence, and that, in fact, it does not involve
   7   any expertise whatsoever.
   8            THE COURT:  What do you say, Mr. Atlas?
   9            MR. ATLAS:  I think Dr. Touretzky will be testifying
  10   as an expert.  I think he can opine on the matters he has in
  11   paragraph 7, but I have no objection if the Court takes it for
  12   everything other than paragraph 7.  I think it will help for
  13   the Court.
  14            THE COURT:  Dr. Touretzky, I take it that you're
  15   telling us that the statements made in this document are true.
  16            THE WITNESS:  Yes.
  17            THE COURT:  Correct?
  18            THE WITNESS:  Correct.
  19            THE COURT:  All right.  I will receive paragraphs 1
  20   through 6 simply as a way of shortcutting his direct testimony
  21   in open court.  I do note that to the extent he expresses
  22   opinions on legal subjects, I'm not going to consider those
  23   opinions as evidence.  Obviously some of these things are
  24   matters for me to decide.
  25            The one that caught my eye particularly is the
                                                                1065
   1   assertion at the beginning of paragraph 3 that "source code is
   2   expressive speech meriting the full protection of the First
   3   Amendment."  That is ultimately for me to decide.
   4            This witness is not here as a law professor, but,
   5   obviously, he may have things that are relevant to my
   6   determination of that question to say.
   7            MR. ATLAS:  That's what I would like to focus this
   8   witness' testimony on today, especially his gallery of CSS
   9   descramblers which he's testified about.
  10   BY MR. ATLAS:
  11   Q.  Dr. Touretzky, do you have a website?
  12   A.  Yes, I do.
  13   Q.  Is the Gallery of CSS Descramblers that you testified a
  14   moment ago posted on this website?
  15   A.  Yes.  I have an extensive website about DeCSS, and one
  16   portion of that website is the Gallery of CSS Descramblers.
  17            THE COURT:  I should note, Mr. Atlas, that
  18   Defendants' Exhibit BBC does include internal references to
  19   attached exhibits, which are not attached, one of which is a
  20   printout of the gallery.
  21            MR. ATLAS:  I've broken them down separately, and I'm
  22   going to take them as individual exhibits.
  23            THE COURT:  All right.
  24            MR. ATLAS:  If I could approach the witness.
  25            THE COURT:  All right.
                                                                1066
   1            MR. ATLAS:  It's Exhibit CCN.
   2            THE COURT:  CC.
   3            MR. ATLAS:  N.
   4            THE COURT:  N.
   5            MR. ATLAS:  Just so we're clear, I'd like to show the
   6   witness -- the witness provided me this morning with a copy
   7   that has various colors on it.  He said it would be easier as
   8   he goes through and describes what the gallery is if he can
   9   refer to this one.  The copies I have are black and white.  Is
  10   there an objection to my showing him the colored version?
  11            MR. MERVIS:  No.
  12   BY MR. ATLAS:
  13   Q.  Dr. Touretzky, can you tell us what Defendants' Exhibit
  14   CCN is?
  15   A.  This is a printout of the main page of my Gallery of CSS
  16   Descramblers.
  17   Q.  Now, what is the Gallery of CSS Descramblers?
  18   A.  The gallery is a presentation of the CSS decryption of
  19   algorithms in various forms in an attempt to show that these
  20   forms are equivalent and that it's not possible to
  21   discriminate between them.
  22   Q.  Why did you create the gallery?
  23   A.  Well, in reading reports of this case, it seemed to me
  24   that the public discussion of some of these issues having to
  25   do with legal status of computer code as speech could benefit
                                                                1067
   1   from pointing out some of the things I try to point out in the
   2   gallery.  And since no one else seemed to be discussing it, I
   3   thought I would create this website.
   4   Q.  If we could referring to Defendants' Exhibit CCN, which is
   5   your gallery.  If you could take us through, I guess,
   6   beginning with the reference here to the anonymous C source
   7   code, and just explain what it is you were trying to do.
   8   A.  Sure.  So, the two points that the gallery tries to make
   9   are, first of all, that source code has expressive content,
  10   and, secondly, that you can't distinguish between different
  11   forms of description of an algorithm, whether they're in
  12   computer language like C or English or some other notation.
  13            So the first two items in the gallery -- the first
  14   item is the anonymous C source code, which is the source code
  15   that was posted to the LiViD mailing list in October of 1999.
  16   This is one of the items that is covered, I believe, by the
  17   injunction issued by this Court.
  18            The second item is another version of the same
  19   algorithm.  This.item is called CSS descramble.c, and this
  20   comes from the CSS-auth software package that was authored by
  21   Derek Fawcus.  And the point of providing these two versions
  22   is to show that it is possible to have different
  23   implementation of an algorithm, and by looking at these
  24   different implementations, one can gain knowledge that one
  25   couldn't get from looking at other decryptions of the
                                                                1068
   1   algorithms.
   2            So, for example, if you compare CSS descramble.com
   3   against the anonymous C source code, one of the things you see
   4   is that Mr. Fawcus used fewer tables in his implementation,
   5   and he unrolls one of the loops.
   6            So, what he's telling us is, hey, there's more than
   7   one way to implement this algorithm.  You don't need to use so
   8   many tables.  You can use fewer tables.  You don't have to do
   9   this operation in a loop.  Maybe it's more efficient to unroll
  10   the loop and have the individual operations stated as separate
  11   lines of code, and that's a message that Mr. Fawcus is
  12   expressing in his chosen implementation of the algorithm.
  13            You can't get that message, except by looking at the
  14   source code and reading the source code.  So that's the only
  15   thing that can be expressed in the source code.
  16   Q.  By the way, if you could turn the page to page 2 of the
  17   gallery.  And can you explain to us what the first item on
  18   page 2 is?
  19   A.  Yes.  I should say that the next section of the gallery,
  20   the items on page 2, they all have to do with the issue of
  21   different forms the code can take and the fact that this Court
  22   has enjoined some forms and not others, and I was puzzled by
  23   that.  It struck me as unusual that the Court would decide
  24   that it was okay to ban, say, the C source code, but the Court
  25   declined to ban discussion of the algorithm.
                                                                1069
   1   Q.  Why?
   2   A.  Because in my mind, these things are all equivalent, and
   3   so I was wondering what your Honor was thinking when he
   4   decided that this would be an effective remedy and why the
   5   MPA's lawyers thought they won something when they got this
   6   injunction because to my mind this didn't -- I couldn't make
   7   sense of it.
   8            So in an attempt to explore what the reasoning of the
   9   Court and the plaintiffs' lawyers might have been, I decided
  10   to investigate different forms that the code could take and
  11   look at the implications of that.
  12            So I began with the first two exhibits, which we've
  13   already discussed, which are the actual C source code, but the
  14   LiViD version and the CSS-auth version, which I believe have
  15   been enjoined.
  16            Now, it seemed to me that it could be that The
  17   Court's reasoning was that these are files that could be fed
  18   to a C compiler, whereas an English description, which the
  19   Court declined to enjoin, could not be fed to a C compiler.
  20   So if that was the Court's reasoning, what I've shown in this
  21   exhibit on the top of page 2 is a screen dump of the CSS
  22   descrambling code.  So this is the CSS code written as a
  23   binary image file.  So in this form, the code cannot be feed
  24   to a C compiler, and, perhaps, therefore, it would fall into
  25   the category of protective speech.
                                                                1070
   1            But if that was the case, the problem here is that
   2   any human could look at this image and just type the
   3   characters that they see into a text editor, and then they
   4   would have the C source code again.  Furthermore, there are
   5   today, there are OCR programs.  OCR stands for optical
   6   character recognition, which can take a binary image file like
   7   this and turn it automatically into text form.
   8            So it's not clear to me then if these binary images,
   9   if these pictures of the source code -- that's what they are,
  10   pictures -- if the pictures themselves are really illegal
  11   circumvention devices under the DMCA, but since they can't be
  12   feed to a C compiler directly, maybe they're protected speech.
  13   Q.  Did you reach any conclusion in terms of your examination
  14   of this particular description of the code?
  15   A.  Well, my conclusion is that if these images are protected
  16   speech, then really the Court has provided the plaintiffs no
  17   protection at all because it was trivial to turn these back
  18   into text files.  So, since the plaintiffs seem to think that
  19   they won something with this injunction, it must be that these
  20   images are not protected speech.  They must be circumvention
  21   devices.
  22   Q.  Why is that?
  23   A.  Well, because they're trivially convertible into
  24   circumvention devices by looking at the picture and typing the
  25   words.
                                                                1071
   1   Q.  Moving down to the second item.
   2            THE COURT:  So, is the net of your view that if the
   3   preliminary injunction decision was in substance correct, as a
   4   matter of law, the problem is that the injunction is far too
   5   narrow?  Is that one way of putting your conclusion?
   6            THE WITNESS:  Yes; I think that's correct.
   7            THE COURT:  Okay.  I thought that's where you were
   8   going.
   9   BY MR. ATLAS:
  10   Q.  The second item on page 2.
  11   A.  The second item is a file called new-language.txt, and I
  12   believe that you have a printout of that that you can
  13   introduce as a separate exhibit.
  14   Q.  Actually before I get to that, I'd like to explore
  15   something the judge had just asked you if you don't mind.
  16   Why, in your view, would it be too narrow, the injunction, as
  17   it currently stands?
  18   A.  Well, I think what the Court was trying to do in the
  19   injunction is prevent people from obtaining technology that
  20   could be used to decrypt DVDs without the authority and
  21   permission of the motion picture industry, and simply
  22   restricting a particular form of the C source code will not be
  23   an effective way of preventing that.
  24            And so if you're going to be effective about it, if
  25   you're really going to stop people from doing it, you've got
                                                                1072
   1   to stop them from hearing the message that the defendants were
   2   trying to convey.  You've got to stop them from any
   3   description of the algorithm, which could be used to construct
   4   one of these devices.
   5   Q.  Would that say that could include an oral conversation
   6   that one would have in sufficient detail in discussing the
   7   DeCSS program?
   8   A.  Yes, it would.  I could certainly sit down with someone
   9   who had the appropriate degree of knowledge of C programming
  10   and of encryption technology, and with an oral conversation --
  11   assuming that person had a good memory -- they could acquire
  12   the knowledge necessary to reconstruct this program, yes.
  13   Q.  Let's draw your attention to back to page 2, which you
  14   said I might have a copy of that.  One moment.
  15            MR. ATLAS:  If I may approach, your Honor.  This is
  16   Exhibit CCQ, Defendants' Exhibit CCQ.
  17   BY MR. ATLAS:
  18   Q.  What is that document, Dr. Touretzky?
  19   A.  This is a printout of the second exhibit on page 2 of the
  20   gallery, which is called new-language.txt.  And what I did
  21   with this exhibit, I tried to further explore this issue of
  22   the legal status of computer code.  So if these pictures of
  23   the code in the previous gallery exhibit, if the Court had a
  24   problem with distributing those pictures of the C code, maybe
  25   that wasn't -- maybe that wasn't protected speech.
                                                                1073
   1            If they have a problem with that, maybe the problem
   2   is that these are pictures of code expressed in a language for
   3   which there is a compiler.  There are C compilers available
   4   for free, and so if you had a picture of the code, you could
   5   type the code in, just literally typing what you see on the
   6   screen, and then you can run it through the C compiler.
   7            So if that was the problem, then maybe it would be
   8   okay to describe the algorithm in another computer language
   9   that had all the precision of C, but for which there did not
  10   exist a compiler.  So what I did is I created a computer
  11   language, which has the same semantics as a C programming
  12   language, but perhaps has a different syntax, and I
  13   recompressed the DeCSS algorithm in this new language.
  14            Now, there is no compiler for this language, and so
  15   it could be that the Court would find that since you can't
  16   feed this to a compiler, because there isn't a compiler, then
  17   this form of the algorithm might be protected speech, might be
  18   okay.  But I have to say I'm pretty worried about this because
  19   with this version of the code out on the web, I have no way of
  20   preventing another person from writing a compiler for my
  21   language.
  22            And having done that, they will then make me in the
  23   position of having provided code that's now compilable even
  24   though I didn't create the compiler, and, in fact, there was
  25   no compiler when the code was originally written.  So I think
                                                                1074
   1   this raises problems, too, that expressing the code in a
   2   language that is as precise as C, but for which there is no
   3   compiler, really you can't give that the same protected status
   4   as other kinds of speech.  You have to view it as a device
   5   because it could become compilable at any time.
   6   Q.  Moving down to the next item on your gallery.  I think I
   7   have a copy of that.
   8            MR. ATLAS:  It's Exhibit CCO.
   9   Q.  Is this the next step in your analysis, Dr. Touretzky?
  10   A.  Yes.  This is a copy of the file plain-english.html.
  11   Q.  What was the purpose of doing that?
  12            THE COURT:  I'm delighted, Doctor, that this is plain
  13   English to someone.
  14            THE WITNESS:  I did my best.
  15            THE COURT:  I wasn't finding fault.
  16   A.  This is the third gallery item on page 2 of the gallery
  17   printout.  So what I tried to do here was, again, to further
  18   explore this issue of the status of source code, and if it's
  19   the case that the previous file, my new-language.txt -- if
  20   that was, perhaps, not deserving of First Amendment protection
  21   because somebody could write a compiler for it -- and the
  22   Court had already refused to enjoin mere discussion of the
  23   algorithm -- I know that from reading the transcript of the
  24   preliminary injunction hearing and from reading the memorandum
  25   that the judge subsequently wrote -- it seemed to me that the
                                                                1075
   1   next thing one could consider was translation of the algorithm
   2   in English.
   3            Now, there's two ways to do that.  The most
   4   mechanical way is to simply translate the C code directly into
   5   English and make no other changes, and I decided not to bother
   6   with that.  I'll leave that as an exercise for an
   7   undergraduate, but I thought a more interesting way to do it
   8   would be to translate the C code into English, but, in
   9   addition, include some explanatory text and some editorial
  10   comments.  And that's what I've done in this version.
  11            So if you look at this version, the first couple of
  12   paragraphs are introductory text, and then that's followed by
  13   an image, which I borrowed from a website in Norway that
  14   explains the big picture of how DVDs -- how movies on DVDs are
  15   descrambled.  And after that image, there's another paragraph
  16   of text where I explain what the image conveys.
  17            And following that, the remainder of this document is
  18   my translation of the C code into plain English, and that
  19   translation is done pretty much line by line, but it contains
  20   certain informalities of language and minor editorial
  21   comments, which are the kinds of things that a human could do,
  22   but a computer program typically could not do.
  23   Q.  And did you reach any conclusions in preparing this
  24   plain-english.html version?
  25   A.  My conclusion is that this version is substantially
                                                                1076
   1   equivalent to the original C source code that was the first
   2   very exhibit in the gallery.  That any person with a
   3   rudimentary knowledge of C would be able to go from this
   4   English description back to the C source code and reproduce
   5   the C source code flawlessly.
   6            So it seems to me that this document ought to be
   7   enjoined for the same reason that all the others are, is that
   8   it's providing exactly the same information.  It's providing a
   9   description of the algorithm with enough precision that
  10   another person could reproduce the software.
  11   Q.  Moving down to the fourth item on page 2 of your gallery.
  12   It's the english-and-c.html version.
  13            MR. ATLAS:  I have a copy of that as well.  It's
  14   Defendants' Exhibit CCP.
  15   Q.  I'm showing you what's been marked as Defendants' Exhibit
  16   CCP.  Could you tell us what that is?
  17   A.  Yes.  This is a printout of the fourth exhibit on page 2
  18   of the gallery.  This is another version of that essay that we
  19   just discussed.
  20   Q.  Why dis you create this version of the essay?
  21   A.  Well, I wanted to further explore the issue of plain
  22   english descriptions being protected.  Given that the Court
  23   declined to enjoin discussion of the algorithm in plain
  24   english, it could be that the previous exhibit,
  25   plain-english.html, perhaps that was protected speech, and if
                                                                1077
   1   it was protected speech, then what would happen if one simply
   2   made a little more explicit the mapping between the English
   3   description of the algorithm and the C code.
   4            So for people who haven't yet acquired a rudimentary
   5   knowledge of the C programming language, I thought I could
   6   give them a little help in converting the English back to C.
   7   And so what I've done is, beginning on page 2 of this
   8   nine-page document, for each English paragraph that
   9   corresponds to a line of C code, I have presented an inset
  10   that gives the translation of that English into C.
  11            And in the original document, that inset is done in a
  12   light blue background to make it visually distinct, and it's
  13   also indented.  The indentation surveyed the copying process
  14   here, but the blue background did not.
  15            So in going through this, you see for each line of
  16   the algorithm described in English, there is the corresponding
  17   expression of that algorithm in C code.  All I'm doing is
  18   translating my English into statements in the C language.  So
  19   an interesting thing about this document is that it contains
  20   within it the source code for the CSS descrambling program,
  21   which the Court has enjoined.
  22            But you cannot feed this file to a C compiler because
  23   that C source code is interspersed with both English and with
  24   HTML formatting commands, which provides the blue background
  25   and information and so on.  So you can't compile this thing,
                                                                1078
   1   but you can read it, even if you're not a very good C
   2   programmer.  But what you learn from reading this document
   3   would allow you to recreate with perfect accuracy the original
   4   descrambling algorithm.
   5   Q.  When did you put up the gallery?  When did you post the
   6   gallery?
   7   A.  In March of this year.
   8   Q.  Did anyone involved in this case suggest or encourage you
   9   to create this gallery that you've been testifying about?
  10   A.  The creation of the gallery was my own idea.  I did
  11   discuss it with my graduate students, who thought it was a
  12   pretty good idea and that I should go ahead with it.
  13   Q.  Why did you create and post it?
  14   A.  I wanted to spare public discussion of these issues.  This
  15   case raises what for me are very serious concerns about the
  16   future of computer science and my ability to function as a
  17   computer scientist.
  18   Q.  Why?
  19   A.  Because what the plaintiffs are trying to do is carve a
  20   hole in the First Amendment and say, this kind of speech you
  21   can engage in and that kind of speech you can't.  And as a
  22   computer scientist, this is my livelihood.  I've been
  23   programming computers since I was 12 years old, and I'm very
  24   concerned when events take place that threaten my ability to
  25   express myself.
                                                                1079
   1            THE COURT:  Mr. Mervis.
   2            MR. MERVIS:  I move to strike that portion of the
   3   answer which Dr. Touretzky purports to describe what the
   4   plaintiffs are trying to do in this case and to the extent he
   5   is, also, offering opinion about legal matters.
   6            MR. ATLAS:  I think it's the witness' perception of
   7   how the plaintiffs' position in this case impacts what it is
   8   that he does and how he communicates with his peers and his
   9   students, and I think it's acceptable testimony.
  10            THE COURT:  To the very limited extent of the motion,
  11   it's granted.  I'm not taking Dr. Touretzky's view of the
  12   First Amendment as evidence.  His testimony presupposes a view
  13   of the scope of the First Amendment on which he is not an
  14   expert, which is not a proper subject for testimony and which
  15   is ultimately for me and appellate courts to decide.
  16            There is no doubt that yelling "fire" in crowded
  17   theatre is something that is problematic and probably impedes
  18   expression by certain twisted individuals.  I'm not drawing a
  19   one-to-one analogy.  You know how dangerous one-to-one
  20   relationships are this morning, but you see the point.
  21            MR. ATLAS:  I think it explains why the witness is
  22   here, but I may be --
  23            THE COURT:  I understand that.  I understand why he's
  24   here.
  25   BY MR. ATLAS:
                                                                1080
   1   Q.  By the way, the different ways that you have approached
   2   communicating the DeCSS source code or the DeCSS code, would
   3   those be the types of communication you may -- strike that.
   4            These different ways of approaching the DeCSS code,
   5   are those ways that you communicate with the people in -- your
   6   peers, the other professors, the other faculty members?
   7   A.  Yes.  We mix these techniques freely, and even on the same
   8   page of a paper, you might have descriptions in English.  You
   9   might have mathematical equations, bits of code in a
  10   acceptable programming language, bits of code in a language I
  11   just made up because it's particularly convenient for trying
  12   to express what I'm trying to express.  We use all of these
  13   forms of expression all the time.
  14   Q.  Turning to the last page of your gallery, page 3 --
  15            MR. ATLAS:  Actually before we get to that, what I'd
  16   like to do, your Honor, at this time is move into evidence the
  17   gallery, which is Exhibit CCN and then the three different
  18   types of entries on the gallery, which I think we've marked as
  19   CCO, CCP and CCQ.
  20            MR. MERVIS:  No objection.
  21            THE COURT:  They're received.
  22            (Defendants' Exhibits CCN, CCO, CCP, and CCQ
  23   received in evidence)
  24   BY MR. ATLAS:
  25   Q.  Turning on the top of page 3, the Cryptanalysis of CSS.
                                                                1081
   1   Can you explain what the entry of this refers to?
   2   A.  Yes.  This entry is actually a collection of writings by
   3   Frank Stevenson, rather than a single document.  And in those
   4   writings, which I believe have been entered in this case
   5   already -- in those writings, Mr. Stevenson talks about
   6   various cryptographic attacks on pieces of the CSS encryption
   7   scheme, and some of these documents are English text and some
   8   of them are little bits of C code, which illustrate the point
   9   he's trying to make.
  10            The interesting thing about this exhibit in the
  11   gallery is that this is not -- the software provided here
  12   would not allow you to immediately decrypt the DVD.  What's
  13   here is software that illustrates the effectiveness of the
  14   attacks that Mr. Stevenson developed.  And, yet, again, to
  15   provide the plaintiffs' effective protection, one would have
  16   to somehow prevent the discussion of this material because in
  17   the hands of a knowledgeable person, it could be used to
  18   access the material on the DVD.
  19   Q.  The next item, the DeCSS T-shirt, why did you post this on
  20   the website on the gallery?
  21   A.  Well, this is a photograph of a T-shirt that's offered for
  22   sale by an outfit called CopyLeft, and I purchased one of
  23   those shirts myself.  And the point of including it here is it
  24   seems to me that there is some confusion among all the parties
  25   in this case about whether something is speech or not.
                                                                1082
   1            And my reaction is if you can put it on a T-shirt,
   2   it's speech.  And so the point of showing the T-shirt was to
   3   illustrate that and, also, to raise the question if this
   4   T-shirt, itself, would have to be prohibited, then I wonder
   5   what would happen to me if I wore the shirt in public.
   6   Wearing the shirt in public could, perhaps, be interpreted as
   7   engaging in trafficking a circumvention device.
   8            So if one really wants to afford the plaintiffs the
   9   protection that they seek, I think I would only be able to
  10   wear my shirt in the privacy of my own home and must not go
  11   outdoors with it.
  12   Q.  The final item on here, can you tell us what this refers
  13   to?
  14   A.  Yes.  This is an image file.  It was constructed by Andrea
  15   Gnesutta, who was the winner of a contest for the best way to
  16   distribute the DVD source code.  And what she did was she
  17   created an image file that looks like a bumper sticker.  It
  18   says, DVD Source Code Distribution Contest.  But inside this
  19   image file is the source code.  And although you can't see the
  20   source code, when you display the image on your web browser,
  21   the mere fact that this image appears on this screen -- if
  22   you're looking at a website and this image comes up means that
  23   the source code has been downloaded onto your computer.
  24            And Ms. Gnesutta gives the technique necessary to
  25   extract the source code from the binary image file.  It's a
                                                                1083
   1   couple of simple operations can pull out those bytes, and then
   2   one can easily obtain the text file from that.
   3            (Continued on next page)
   4
   5
   6
   7
   8
   9
  10
  11
  12
  13
  14
  15
  16
  17
  18
  19
  20
  21
  22
  23
  24
  25
                                                                1084
   1   Q.  So, summing up, looking at all the different items you
   2   have on your gallery of CSS -- do you have a difference --
   3   strike that.
   4            Do you have an opinion on the differences, if any,
   5   between them?
   6   A.  My opinion is that there's no effective difference between
   7   any of these forms in that if you want to accomplish what the
   8   Court set out to do in its preliminary injunction, you have to
   9   enjoin all of these forms because if any one of them is
  10   allowed, then it's a trivial matter to transform it into any
  11   of the others.  They're all interconvertible.
  12   Q.  Do you have any opinion on the effect within your field,
  13   the computer science field, if the Court were to issue an
  14   injunction first over the DeCSS executable resource code?
  15            MR. COOPER:  Objection, your Honor; relevance.
  16            THE COURT:  Overruled.
  17   A.  Well, yeah, I see this as having a chilling effect on my
  18   ability as a computer scientist to express myself.  In
  19   comparison, I know I could publish the formula for LSD using
  20   chemical notation and even though I'm not allowed to possess
  21   LSD, no one would try to stop me from publishing the formula.
  22            And I could publish the schematic for the timing
  23   device for a bomb, and even though I'm not allowed to possess
  24   a bomb, no one would try to stop me from publishing those
  25   schematics.
                                                                1085
   1            The language that -- in which I try to express myself
   2   is the computer language and if the Court upholds this
   3   injunction, what would happen is that certain uses of computer
   4   language, my preferred means of expression would illegal.
   5   They'd be enjoined.  And that means that anything I do from
   6   now on has the potential to be ruled illegal.
   7            And furthermore, what I've tried to show with the
   8   gallery, even if I just decided never to try another line of
   9   computer code again, I wouldn't be any better off because
  10   simply writing English, if I wrote it with the same precision
  11   as I used in my plain English on an HTML file would accomplish
  12   the same thing.
  13            So, I could merely by using the kind of precision
  14   that I've been trained to use as a computer scientist simply
  15   by expressing myself that way, I could be opening myself up to
  16   legal liability.
  17            THE COURT:  Dr. Touretzky, do people in your field of
  18   endeavor sometimes make bits of hardware, computer hardware?
  19            THE WITNESS:  Yes, they do.
  20            THE COURT:  Are there circumstances in which it might
  21   be helpful to a computer scientist to make a bit of hardware
  22   as to which somebody else holds the patent?
  23            THE WITNESS:  Yes, I think so.
  24            THE COURT:  O.K.  Mr. Atlas?
  25   Q.  Dr. Touretzky, would a declaration by the Court that the
                                                                1086
   1   CSS descriptions are illegal have a similar chilling effect
   2   compared to an injunction?
   3            MR. COOPER:  I have the same relevance objection,
   4   your Honor.
   5            THE COURT:  Overruled.
   6   A.  Well, it would certainly.  It would certainly make me
   7   afraid to publish things like that; yes.  Any indication by
   8   the Court that this was illegal would concern me; yes.
   9   Q.  By the way, are you being compensated for your role as an
  10   expert in this case?
  11   A.  No, I'm not.
  12   Q.  Why are you rendering services if you're not being
  13   compensated here?
  14   A.  I think the issues being decided here have tremendous
  15   importance for the field of computer science and it's actually
  16   I consider it a privilege to be allowed to come here and
  17   express my views and hope to influence the outcome.
  18   Q.  One other thing, Doctor.  I believe in your deposition an
  19   article that you had prepared was marked -- or actually I
  20   believe it's Exhibit 2 at your deposition, we've marked it as
  21   Exhibit BBE, it's an article entitled "Source Versus Object
  22   Code."
  23            MR. ATLAS:  May I approach, your Honor?
  24            THE COURT:  Yes.
  25   Q.  Dr. Touretzky, if I may, why did you write this article?
                                                                1087
   1   A.  I wrote this article because after reading various
   2   depositions in this case, it occurred to me that the both
   3   sides were grappling with the issue of source versus object
   4   code.  And I could see that several of the other defense
   5   witnesses had tried in depositions to explain that source and
   6   object code are really the same thing, that there isn't any
   7   rational way to distinguish one from the other, but I'm not
   8   sure that the lawyers were getting it.
   9            And I think it's kind of hard to do that in
  10   deposition.  So, by constructing this essay, including the
  11   illustrative appendices at the end, I hoped to assist both
  12   sides in understanding this.
  13   Q.  That's actually what I'd like to refer your attention to
  14   appendices beginning on page 4 of 6 of your article.  Appendix
  15   A, Appendix C, and D.  I was wondering if you could explain
  16   the relationship between these appendices?
  17   A.  Yes, these appendices are four different forms of the same
  18   program.  I'd like to go through them in order and then back
  19   up.
  20            So, starting with Appendix A, Appendix A is a source
  21   file written in the C language for a simple program that
  22   multiplies the numbers 1 through 5 together and then prints
  23   out the result.  In mathematical results, we'd say the program
  24   computes the quantity 5 factorial.
  25            I should say that Appendix A is the same form as the
                                                                1088
   1   version of the DeCSS code that the Court has enjoined.  The
   2   source code written in the C program language just like the
   3   anonymous C source code that the Court has enjoined.
   4            What I next did was I compiled this source code.
   5   Now, a compilation is actually a complicated process with a
   6   number of different steps which are typically invisible to the
   7   lay person, but computer scientists know about them.
   8            So, when you feed the C source code to a C compiler,
   9   let's say GCC, the new C compiler, it's a very commonly-used C
  10   compiler.  What the C compiler does it translates that source
  11   code into a language called RTL, which is an abstract machine
  12   language.  Then it translates the RTL into assembly language
  13   for whatever processor you're compiling for.  In this case, I
  14   was compiling for a spark processor for the sun work station
  15   in my office.
  16            Then an assembler takes the assembly language code
  17   and translates that into machine executable code.  So, what we
  18   have in Appendix B is an intermediate stage in that process.
  19            What I asked the C compiler to do was when it
  20   translated the C to RTL, and then the RTL into assembly
  21   language, I asked it to tell me and give me back the assembly
  22   language, the intermediate product.  So, from the C compiler's
  23   point of view, Appendix B is the object code is a result of
  24   what the C compiler does to the source code, but from the
  25   assembler's point of view, assembler being the next guy in
                                                                1089
   1   line that's going to process this, the assembler used this as
   2   a source code, but as the assembler is going to turn it into
   3   by their machine instructions.
   4            So, if we proceed to Appendix C, what I next did was
   5   I told the C compiler, go ahead and compile this program, and
   6   instead of stopping at the assembly language level, stop at
   7   the level of the binary machine code.  What's called the .0
   8   file or the object file and then I took that .0 file and I
   9   displayed it using a utility program that displays binary
  10   files.
  11            And so, what you see are in Appendix C, the column of
  12   numbers on the left, the leftmost column are the equivalent of
  13   line numbers in a deposition.  They're basically keeping track
  14   of the position in the file and the remaining columns of
  15   numbers are hexadecimal encryption codings of the binary bits
  16   that make up the object file.
  17            Finally, in Appendix D, I took that object file and
  18   fed it to a program called a disassembler.  And the object --
  19   the disassembler translated the object file back into symbolic
  20   assembly language form, and that's what we see in Appendix D.
  21            Now, so the point I want to make here is that the
  22   same ideas that were expressed in my statement to you that
  23   five factorial is the product of the numbers 1 through 5 are
  24   also expressed in all four of these appendices and they're
  25   expressed in ways that are transparent to a computer
                                                                1090
   1   scientist.  And I'd like to show you that starting at Appendix
   2   D, if you look at the line labeled 20 in Appendix D, it's 20
   3   and a colon.
   4            That line in the middle of that line, you see the
   5   letters CMP, which stands for compare.  So, this line is a
   6   line that's telling the computer to compare two numbers.
   7            And if you look to the right of the CMP, what it's
   8   saying is compare the contents of register 00 with the number
   9   5.  So, this is a piece of symbolic assembly language code
  10   which computer scientists can read just fine.
  11            And if you look to the left of the CMP, you'll see
  12   four groups of numbers.  These are hexadecimal numbers.  The
  13   numbers are 80822005.  This is the encoding of that compare
  14   instruction in the binary machine language of the spark
  15   processor.
  16            So now, if you go back to Appendix C, and if you look
  17   at in Appendix C, the line labeled 220, so it's about 10 lines
  18   at the -- down from the top, the line labeled -- it's actually
  19   0000220.
  20            And if you look about halfway in that line, you'll
  21   see the sequence 80822005.  So, this is -- again, this is the
  22   binary machine instruction that's that compare instruction
  23   that we saw in Appendix D.
  24            Now, we can go back once more to Appendix B.  And if
  25   you look at Appendix B, this is again symbolic assembly
                                                                1091
   1   language.  And so, on the left side of Appendix B, you'll see
   2   some labels.  There's a label main and a little bit further
   3   down there's a label that says .LL3 on the left-hand side.
   4            And if you look two lines below that .LL3, we see
   5   again the compare instruction.  CMP percent 00, 5.  It's
   6   comparing the contents of register 00 with the No. 5.  We can
   7   go back one more step and look at Appendix A, my C source
   8   code.
   9            And in Appendix A, about 5 lines down, there's a four
  10   alone.  It begins with the word "four" and then it says:  Left
  11   (I equals 1; I less than 6).  That "I less than 6" that is
  12   exactly what that compare instruction was turned into by the C
  13   compiler.
  14            So, the compare instruction is the expression of this
  15   concept, "I less than 6" in the machine's assembly language.
  16   Q.  So, do I understand that these four appendices are
  17   different ways of expressing the same idea?
  18   A.  Yes, it's exactly the same idea and you might ask, well,
  19   why does "I less than 6" and yet in the assembly language
  20   code, we are comparing the register against the No. 5.  And
  21   the reason is that it reflects a certain strategy used by the
  22   C compiler to encryption code this 4 loop and that the only
  23   way you could know about that strategy is to read the assembly
  24   language.
  25            And I hope what I've shown is that it's not that hard
                                                                1092
   1   to do that.
   2   Q.  In terms of taking one of the items?
   3            THE COURT:  We are all going to get into
   4   post-assembly language this afternoon.
   5            THE WITNESS:  Excuse me?
   6            THE COURT:  We are all going to get to post-assembly
   7   language this afternoon.
   8   Q.  Doctor, can you tell me the skill level it would take to
   9   take any one of the identities that appear on your gallery of
  10   CSS descramblers and turn that into any one of the other
  11   identities that appear on your gallery of descramblers, what
  12   skill level would be involved?
  13            MR. MERVIS:  I object to the form of the question.
  14            THE COURT:  Overruled.
  15            I think we can understand it.
  16   A.  Yes, since I've been involved in teaching computer science
  17   for quite a few years, I'd say that anyone who had taken an
  18   undergraduate level C programming course should be able to
  19   convert between any of these forms.
  20            MR. ATLAS:  The final thing I'd like to move into
  21   evidence, Exhibit BBE, which is the article and the appendices
  22   that the doctor was just talking about.
  23            MR. MERVIS:  No objection, your Honor.
  24            THE COURT:  Received.
  25            (Defendant's Exhibit BBE received in evidence)
                                                                1093
   1            MR. ATLAS:  I have no further questions for Dr.
   2   Touretzky.
   3            THE COURT:  Thank you.
   4            Any cross-examination, Mr. Mervis?
   5            MR. MERVIS:  Unless the professor is going to give us
   6   all a quiz, the plaintiffs have no questions.
   7            THE COURT:  Well, Dr. Touretzky, let me just tell you
   8   that this was illuminating and important.  I was hoping we
   9   were going to hear something like this through the whole
  10   trial.  I appreciate your having come.
  11            THE WITNESS:  Thank you, your Honor.
  12            THE COURT:  Thank you.
  13            (Witness excused)
  14            THE COURT:  The witness is excused.
  15            What's next?
  16   ANDREW APPEL,
  17        called as a witness by the Defendants,
  18        having been duly sworn, testified as follows:
  19            THE CLERK:  State your name, spelling it slowly.
  20            THE WITNESS:  My name is Andrew Appel; A-P-P-E-L.
  21            THE COURT:  All right.  Mr. Garbus, please proceed.
  22            MR. GARBUS:  Professor Appel is our clean-up hitter.
  23   I think a lot of this has been cleaned up, so I'll just try to
  24   cut short, if I can.
  25   DIRECT EXAMINATION
                                                                1094
   1   BY MR. GARBUS:
   2   Q.  Professor Appel, can you tell me something about your
   3   educational background?
   4   A.  Yes, I have a bachelor of arts with highest honors from
   5   Princeton University in 1981 in physics.  I have a Ph.D. in
   6   computer science from Carnegie-Mellon University in 1985.
   7   Q.  And can you tell me something of your professional
   8   appointments?
   9   A.  Yes.  In 1986, I became an assistant professor of computer
  10   science at Princeton University.  Then in approximately 1992,
  11   I was promoted to associate professor and then later to full
  12   professor.
  13   Q.  And have you been at other universities as well?
  14   A.  No, my career since receiving the Ph.D. has been at
  15   Princeton University.
  16   Q.  And what awards and honors have you won?
  17   A.  I received in 1981, the Cusaka Memorial Prize for my
  18   undergraduate research in physics and the National Science
  19   Foundation graduate fellowship and two or three years ago, I
  20   was elected a fellow of the Association for Computing
  21   Machinery.
  22   Q.  And what is the Association for Computing Machinery?
  23   A.  It's the primary scholarly and professional society in the
  24   field of computer science and computing.
  25   Q.  Have you written any books or chapters in books and in
                                                                1095
   1   what areas?
   2   A.  I've written two books in the area of compilers, one
   3   graduate textbook in 1991 and one an undergraduate and
   4   graduate textbook in 1998 and I've written approximately 50
   5   published papers.
   6   Q.  Now, one of the questions is:  What do you bring to this
   7   case that let's say some of the other witnesses who have
   8   testified, what is the difference between your area of work
   9   and Professor Felton?
  10   A.  We both do research in the broad area of computer
  11   security.  My research systems from my previous work in the
  12   area of programming languages and compilers and is more in the
  13   area of theoretical approaches to protecting computers from
  14   the programs that run on them and protecting the programs from
  15   the computers that run them.
  16            Professor Felton's area is more in the broad area of
  17   systems security, what are the practical vulnerabilities of
  18   real systems as implemented.
  19   Q.  And during the course of your work, do you publish codes?
  20   A.  In my work on compilers, I routinely would publish
  21   computer programs in both source code and object code form so
  22   that other scientists could take my work and do comparisons or
  23   improve it by replacing one component or another.
  24   Q.  Are compilers an area of your expertise?
  25   A.  Yeah, I've done about 10 or 12 years of research in the
                                                                1096
   1   area of compilers and published two books and many articles in
   2   that area.
   3   Q.  What is the relationship between compilers and this whole
   4   question of source and object code?
   5   A.  The compiler is what translates the source code to the
   6   object code.  So, that's the relationship.
   7   Q.  How does it work?
   8   A.  The compiler reads the source code, parses its structure,
   9   understands the semantics, and then translates -- translates
  10   each of those structures into the appropriate manifestation in
  11   object code.
  12   Q.  Are you being paid for your work here today?
  13   A.  No, I believe not.
  14   Q.  Why are you testifying?
  15   A.  I'm concerned about censorship of computer programs.  I'm
  16   concerned about the prospects or the end of fair use of
  17   material distributed digitally.  Those are the main reasons.
  18   Q.  Have you ever written any article -- did you co-author an
  19   article with Professor Felton?
  20   A.  I've co-authored two or three articles with Professor
  21   Felton.
  22   Q.  And did you co-author an article with him entitled,
  23   "Technological access control interferes with noninfringing
  24   scholarship"?
  25   A.  Yes.
                                                                1097
   1   Q.  And what was the source of the information in that
   2   article?
   3   A.  In that article, we wanted to demonstrate that many kinds
   4   of scholarship, especially scholarly searches of different
   5   kinds of material would require access to the unencrypted
   6   content.
   7            Some of the sources were our own expertise in the
   8   representation of text and computer programs and for the
   9   sections on audio and video, we also read the research
  10   literature and consulted with other experts.
  11   Q.  And do you recall the examples you used in your article?
  12   A.  I used examples of searching text materials such as books
  13   for not only individual words, but also correlations between
  14   one part of the document and another.  I used examples of
  15   analyzing musical scores to extract themes.  I used examples
  16   of searching digital audio such as CDs for themes and
  17   transitions.
  18   Q.  And how is that affected by the issues that we face here?
  19            MR. MERVIS:  Objection, your Honor, relevance.
  20            THE COURT:  Overruled.
  21   A.  If scholars are unable to access the unencrypted content
  22   of movies, then they will not be able to do research that
  23   requires automated search of those materials.  And there are
  24   many benefits to those areas of research.
  25   Q.  What are the benefits?
                                                                1098
   1   A.  Well, the first benefit is in developing the methods
   2   themselves for doing automated search.  Scientists need input
   3   on which to test their methods.
   4            The second is that the searches themselves will be
   5   useful, not just to computer scientists or experts in video,
   6   but scientists may wish to do searches for purposes in society
   7   and the example we gave in the paper is that one might in the
   8   future wish to search a library of Hollywood movies for scenes
   9   that contain cigarettes, perhaps as part of public health
  10   research.
  11            The technology is not there yet for doing a search of
  12   that kind, but that's just the kind of thing that computer
  13   scientists and video engineers are working on.
  14   Q.  This, also, applied to books that run DVDs or music that
  15   was on DVDs?
  16   A.  Yeah, if other kinds of content such as books and audio
  17   are distributed with technological access controls, then many
  18   kinds of searches on those materials will also become
  19   impossible.
  20   Q.  Did you follow the development of the DMCA, the Digital
  21   Millennium Copyright Act?
  22            MR. MERVIS:  Objection, your Honor, relevance.
  23            THE COURT:  Sustained.
  24   Q.  Did you submit a paper to Congress?
  25   A.  The article that you mentioned on technological access
                                                                1099
   1   controls was submitted to the copyright office as part of its
   2   rule-making procedures.
   3            I believe I also signed a letter initiated by Gene
   4   Spafford which had to do with the exemption in the law for
   5   research by cryptography research for reverse engineering of
   6   access controls.
   7   Q.  In what form are text files stored in a computer?
   8   A.  The text files are stored using 1's and 0's usually in a
   9   correspondence given by the ASCII codes that matched the 1's
  10   and 0's to letters and numbers.
  11   Q.  Is that source code or object code or both?
  12   A.  Source code would be stored, you know, according to the
  13   correspondence given by the ASCII code.  Object code would be
  14   stored as 1's and 0's, according to the correspondence given
  15   in the reference manual for the particular computer.
  16   Q.  Do you know what DeCSS is?
  17   A.  DeCSS is a program that decrypts content that was
  18   encrypted CSS with algorithm.
  19   Q.  When did you first learn about it?
  20   A.  I think I learned of the existence of DeCSS sometime I
  21   would guess around January.  I became more familiar with it in
  22   approximately March or April.
  23   Q.  And where did you go to find it?
  24   A.  I just typed DeCSS into a web search engine.  I believe I
  25   used Google, and that gave me a few hundred hits, I believe,
                                                                1100
   1   and I examined each of the web pages just by viewing it until
   2   I found some that had source code claiming to be DeCSS.
   3   Q.  Did you go to Bruce Schneier's website?
   4   A.  I believe I did, yes.
   5   Q.  And who is he?
   6   A.  Bruce Schneier is a cryptographer.  He's an author of a
   7   widely-used text and reference book on applied cryptography.
   8   Q.  Did you go to David Wagner's site?
   9   A.  Yes, I did.
  10   Q.  And who is he?
  11   A.  David Wagner is a graduate student or maybe he's just
  12   received the Ph.D. from the University of California at
  13   Berkeley.  He does research in practical aspects of computer
  14   security, including cryptographic protocols.
  15   Q.  And did you also go to Professor Touretzky's site?
  16   A.  Yes, I did.
  17   Q.  Did you go to Greg Nuby's site?
  18   A.  Yes.
  19   Q.  And who is he?
  20   A.  Greg Nuby is a professor of library science and he had a
  21   website that discussed DeCSS as it would be useful to
  22   librarians in archiving digital material.
  23   Q.  Do you have a web page?
  24   A.  Yes, I do.
  25   Q.  Did you post DeCSS?
                                                                1101
   1   A.  No, I do not.
   2   Q.  Why not?
   3   A.  I wasn't sure what the legal aspects of doing so would be
   4   and I didn't have an immediate need to do it.
   5   Q.  Now, is it your testimony -- text and source code and
   6   object code each stored its 1's and 0's in the computer?
   7   A.  They're all stored as 1's and 0's.
   8   Q.  Now, now does the -- does the word "blowfish" mean
   9   anything to you?
  10   A.  "Blowfish" is an encryption algorithm designed I believe
  11   by Bruce Schneier two or three years ago.
  12   Q.  And the following initial C2TXT2C, can you tell me what
  13   that is?
  14   A.  Yes.  At the time that blowfish was invented, there was
  15   still some question in the United States law whether it was
  16   permissible to post cryptographic algorithms on the Internet.
  17            So, a computer scientist in Finland, I believe,
  18   designed a program called C2 Text 2C that would translate
  19   Schneier's computer program from source code to English
  20   language text.  And English language text would be, in effect,
  21   a description of the computer program, but it would not be the
  22   computer program itself.
  23            And there's also as part of this utility a program
  24   that would translate the English language text back to a C
  25   program.  So, I was interested in this because it shows the
                                                                1102
   1   difficulty of drawing a line in prohibiting the distribution
   2   of source code, but not prohibiting descriptions of the
   3   algorithm in English.
   4   Q.  Now, have you ever met Eric Corley or Emmanuel Goldstein
   5   in this case?
   6   A.  No, I have not.
   7   Q.  You testified that you do work in the area of security
   8   with Professor Felton, can you tell us about your experience
   9   with the web browser?
  10   A.  Yes.  About three or four years ago, when web browsers
  11   were just coming out, that supported the java programming
  12   language, that is to say, a website could provide a computer
  13   program that would run in the browser of the user.
  14            There was some concern about whether this would be a
  15   way for viruses to propagate from the website being browsed
  16   into the user's computer.  And the claim made with the initial
  17   java enabled browsers was that they provided security against
  18   attacks by the website to the user's computer.
  19            Some students at Princeton found ways to defeat the
  20   security.  Half a dozen different methods initially and they
  21   came to me and I believe also they came separately to
  22   Professor Felton asking whether they should publish a
  23   description of these security holes and whether that would be
  24   research in computer science that would be valuable to pursue.
  25   And I advised them that it would be an excellent subject for
                                                                1103
   1   research and they did, in fact, publish that paper.
   2   Q.  Have you been involved in any other situations concerning
   3   vulnerabilities of codes --
   4   A.  Well, the research I do has to do with -- I'm not sure.
   5   Q.  You don't have a sun tan, but were you in Hawaii last
   6   week?
   7   A.  I was at a meeting of the defense advanced research
   8   project agency meeting of principal investigators in the area
   9   of computer security.
  10   Q.  And were you at a conference that dealt specifically with
  11   the whole question of vulnerability in systems?
  12   A.  Right.  The -- one of the program managers who works for
  13   the defense department convened a workshop of all of these
  14   researchers working in the area of security.  These
  15   researchers are trying to build more secure systems that can
  16   defend against attacks by hackers.  And one of the workshops
  17   that he convened was to have the researchers explain exactly
  18   what kinds of attacks they're defending against.
  19            And one thing we concluded in this discussion was
  20   that the researchers building the defenses don't have a very
  21   good exploit the vulnerabilities in systems the better so that
  22   we can design more security systems to make that defense.
  23            MR. MERVIS:  Your Honor, move to strike the answer.
  24   It was entirely based on hearsay.
  25   A.  Right.  The -- one of the program managers who works for
                                                                1104
   1   the defense department convened a workshop of all of these
   2   researchers working in the area of security.  These
   3   researchers are trying to build more secure systems that can
   4   defend against attacks by hackers.
   5            And one of the workshops that he convened was to have
   6   the researchers explain exactly what kinds of attacks they're
   7   defending against.  And 1 thing we concluded in this
   8   discussion was that the researchers builds the defenses don't
   9   have a very good exploit the vulnerabilities in systems the
  10   better so that we can design more security systems to make
  11   that defense.
  12            MR. MERVIS:  Your Honor, move to strike the answer.
  13   It was entirely based on hearsay.
  14            THE COURT:  What do you say, Mr. Garbus?
  15   BY MR. GARBUS:
  16   Q.  Did you participate in these conversations?
  17   A.  I participate in the conversations and I gave a short
  18   presentation of about 15 minutes.
  19            THE COURT:  Look it seems to me this is an is self
  20   evident proposition, I will overrule the objection.
  21   Q.  With respect to Frank Stevenson, have you ever read his
  22   paper dealing with DeCSS?
  23   A.  Yes, that was one of the first things I found on the web
  24   when I was looking for DeCSS and I found his analysis of the
  25   DeCSS algorithm to be very helpful.
                                                                1105
   1   Q.  Why?
   2   A.  Because it explained what the source code was doing, what
   3   the CSS system itself was accomplishing that the source code
   4   was undoing and what were the weaknesses in the system.
   5            MR. GARBUS:  Thank you, Professor.
   6            I would like to move in as Defendant's BL, the
   7   affidavit of Professor Appel, which goes into more deeply,
   8   which I don't think I have to go into here and annexed to it
   9   is his vitae and annexed to that is the paper that he's
  10   referred to.
  11            THE COURT:  Mr. Mervis?
  12            MR. MERVIS:  Your Honor, with respect to the
  13   affidavit, I just have to find a copy of it.  We do object to
  14   paragraphs 14 -- we don't object to the CV.  So, that's no
  15   objection to that.
  16            THE COURT:  May I have a copy of this exhibit?
  17            MR. GARBUS:  Your Honor, you have already made
  18   rulings on the previous affidavit.  I would think those would
  19   be appropriate here in not accepting Professor Appel's --
  20            THE COURT:  Tell me what the paragraph is you are
  21   objecting to, Mr. Mervis.
  22            MR. MERVIS:  Paragraphs 1 through 13, I think are of
  23   dubious relevance, but we don't have any particular objection.
  24            14 through 19, we do object to on the grounds of
  25   relevance.  We also in particular object to that part of
                                                                1106
   1   paragraph 14 that discusses what appears on various websites
   2   on two grounds; No. 1, that it's not the best evidence, and
   3   No. 2, it's hearsay.
   4            THE COURT:  Let me just look at it.
   5            MR. GARBUS:  Your Honor, to save time, you might want
   6   to just take it subject to those rulings.
   7            THE COURT:  Just give me a moment.
   8            What about Attachment B, Mr. Mervis?
   9            MR. MERVIS:  Your Honor, I believe that this exhibit
  10   is already in evidence.
  11            THE COURT:  So, then you don't have a problem with
  12   it?
  13            MR. MERVIS:  Well, no, your Honor.  I have no
  14   problem, assuming that your Honor's comments with respect to
  15   the exhibit and its weight, I assume, would apply with respect
  16   to this witness as well.
  17            THE COURT:  I'm not sure I made any.
  18            MR. MERVIS:  Your Honor, let me see if I can find
  19   the --
  20            THE COURT:  All right, look --
  21            MR. MERVIS:  The answer is no.  I don't have an
  22   objection.  It's reflected at page 755 of the trial
  23   transcript.
  24            THE COURT:  O.K., fine.  So, I'm going to take BL out
  25   to the extent that the witness in BL offers opinions on the
                                                                1107
   1   law.  I'm obviously not going to consider it.
   2            To the extent that paragraph 14 relates to what he
   3   saw on other people's websites, what about that, Mr. Garbus?
   4            MR. GARBUS:  Let me ask him the question.
   5   BY MR. GARBUS:
   6   Q.  Did you see this material on other people's websites?
   7   A.  Yes.
   8            MR. MERVIS:  I did.  The material discussed in
   9   paragraph 14 I found by searching the web for references to
  10   DeCSS and taking particular note of those that were describing
  11   it in a scholarly context.
  12            THE COURT:  That's adequate, as far as I could see.
  13            So, BL is received with its attachments except to the
  14   extent it contains legal opinions.
  15            And I think that takes care of that.
  16            MR. GARBUS:  Thank you.  I have no further questions.
  17            THE COURT:  Thank you.  Any cross-examination?
  18            MR GOLD:  Your Honor, I thought I'd get through the
  19   trial without making any requests for a sidebar, but by 15
  20   minutes I lost.  May we approach?
  21            THE COURT:  All right.
  22            (At the sidebar)
  23            MR GOLD:  Your Honor, as a result of the testimony of
  24   the last witness, which we didn't expect based on his
  25   deposition or anything, as I said before, I need about 15
                                                                1108
   1   minutes or 20 to decide whether we have any cross for him at
   2   all and whether we were going to go forward with our efforts
   3   to put in a witness on rebuttal.
   4            So, what I'd like to do, with your Honor's
   5   indulgence, is take the lunch break 15 minutes early, come
   6   back 15 minutes earlier than usual, and then announce whether
   7   we'll cross him and whether we have any rebuttal case and who
   8   it would be and how long.
   9            THE COURT:  Any problem?
  10            MR. GARBUS:  That would be fine.
  11            MR. ATLAS:  I said something which probably should be
  12   clarified.  Before we close, we would have to deal with all
  13   the documents.
  14            THE COURT:  They have their documents, too.
  15            MR. GARBUS:  That would be part of the case before
  16   anybody closes.
  17            MR. ATLAS:  You'd be glad to know we took our seven
  18   boxes and narrowed it is down to three-quarters of a box.
  19            THE COURT:  Good.
  20            MR. MERVIS:  I did note it was a small case about
  21   what was in here, I was right about that.
  22            MR. ATLAS:  We provided plaintiff's counsel with the
  23   list of exhibits.  I'm sure they'll have some objections, too.
  24            THE COURT:  We will deal with that later.
  25            (In open court)
                                                                1109
   1            THE COURT:  We are going to take the lunch recess
   2   now.  I will see everybody back at a quarter to 2 and we will
   3   go from there.
   4            (Luncheon recess)
   5            (Continued on next page)
   6
   7
   8
   9
  10
  11
  12
  13
  14
  15
  16
  17
  18
  19
  20
  21
  22
  23
  24
  25
                                                                1110
   1                  A F T E R N O O N  S E S S I O N
   2            (In open court)
   3            THE COURT:  Please be seated.  Good afternoon folks.
   4   Any cross-examination for this witness?
   5            MR. MERVIS:  Yes, your Honor, a little bit.
   6            THE COURT:  Okay.
   7    ANDREW APPEL, resumed.
   8   CROSS-EXAMINATION
   9   BY MR. MERVIS:
  10   Q.  Good afternoon, Professor Appel.  Am I correct in
  11   understanding that you have never personally used the DeCSS?
  12   A.  That's correct.
  13   Q.  And that would include the encrypted DVD?
  14   A.  That's correct.
  15   Q.  And am I also correct that in connection with your
  16   teaching at Princeton, you've never used the DeCSS code, is
  17   that correct?
  18   A.  That is also true.
  19   Q.  And apart from the presence of your declaration in this
  20   case on your website, your website doesn't discuss DeCSS in
  21   any way, is that right?
  22   A.  That's right.
  23   Q.  And is it, also, correct that you have never analyzed the
  24   DeCSS in object code form?
  25   A.  That's right.  I've analyzed other programs in connection
                                                                1111
   1   with reverse engineering of encryption software in object
   2   code, but not DeCSS in particular.
   3   Q.  Thank you.  Now, do you recall testifying this morning on
   4   direct that you used the Google search engine to find DeCSS
   5   code on the Internet?
   6   A.  That's right.
   7   Q.  And am I correct in understanding that your search was you
   8   typed in the character stream DeCSS?
   9   A.  That's right.
  10   Q.  And you got, what, about a hundred hits or so?
  11   A.  At least a hundred.
  12   Q.  At least a hundred.  Now, am I correct in understanding
  13   that when you conducted that search, you were looking for
  14   DeCSS source code, is that right?
  15   A.  My primary interest at that time was to look for the
  16   source code.
  17   Q.  Now, approximately how many sites did you visit, that were
  18   reported under search result, before you actually found the
  19   source code?
  20   A.  I don't recall.  My guess is somewhere between five and
  21   ten.
  22   Q.  And with respect to those five or ten sites that you
  23   visited before you found the source code, is it correct that
  24   you don't know whether object code was present on any of those
  25   sites?
                                                                1112
   1   A.  I don't recall.
   2   Q.  Now, once you found the source code after visiting five to
   3   ten sites, did you make any further searches of any other
   4   sites that were reported on your search result?
   5   A.  Yes, I did.  I was interested in seeing how many of the
   6   sites were posting DeCSS in a scholarly context.
   7   Q.  I see.  And how many such sites did you visit?
   8   A.  Out of the sites I visited, at that time I identified four
   9   in particular.
  10   Q.  Four of those you visited.  Okay, four had -- you claim
  11   had some sort of scholarly commentary on them?
  12   A.  Right, a discussion of DeCSS in a scholarly context.
  13   Q.  I see.  Now, how many sites total did you visit to find
  14   those four?
  15   A.  My estimate is on the order of a hundred.
  16   Q.  On the order of a hundred.  Now, of those hundred, how
  17   many of them contain or had posed to them either DeCSS source
  18   code or object code?
  19   A.  My guess is it would have been on the order of 20 or 30.
  20   Q.  So roughly a quarter, less than a quarter?
  21   A.  I just don't recall.
  22            THE COURT:  You don't need a Ph.D. in engineering
  23   from Princeton to do that one.
  24            MR. MERVIS:  Your Honor, agreed, and I will not do
  25   that one.  My math is not that good.
                                                                1113
   1   Q.  Now, is it correct, Dr. Appel, that the search result from
   2   a search engine is driven by the character stream you type in,
   3   is that right?
   4   A.  That's right.
   5   Q.  And in this case the character stream was DeCSS, is that
   6   right?
   7   A.  That's right.
   8   Q.  Am I correct in understanding that the Google search that
   9   you did not tell you how many of the site hits you got
  10   actually had on them either DeCSS source code or object or
  11   binary code, right?
  12   A.  That's right.
  13   Q.  Were any of the sites that were reported in your search
  14   results offered on the same ISP?
  15   A.  I don't recall.  The same ISP as each other?
  16   Q.  Correct.
  17   A.  I don't recall.
  18   Q.  And do you know whether any of the sites that were
  19   reported on your search result were foreign sites?
  20   A.  Yes.  Some of them were foreign sites.
  21   Q.  About how many?
  22   A.  I don't -- I didn't keep track of the proportion.
  23   Q.  And were there instances in which the same site was
  24   reported more than once in your search result?
  25   A.  I don't remember.
                                                                1114
   1   Q.  That's something that's -- excuse me.  I'm sorry.  I just
   2   ate lunch.  That's something that's common with search
   3   engines, isn't it?
   4   A.  It's common to have different pages on the same site pop
   5   up in the same search.
   6   Q.  Do you know whether any of the sites that were reported in
   7   your search result merely linked to other sites where either
   8   it did not have DeCSS code posted or were simply inactive?
   9   A.  Some of the sites I found didn't have DeCSS and didn't
  10   link to it.  They just mentioned it.  Some of them linked to
  11   it.  Some of them had it directly.  I didn't keep count of
  12   which was which.
  13            MR. MERVIS:  Can I take a moment to consult, your
  14   Honor?
  15            THE COURT:  Yes.
  16            MR. MERVIS:  Nothing further, Judge.
  17            THE COURT:  Thank you, Mr. Mervis.  Any redirect?
  18            MR. GARBUS:  We have no redirect.
  19            THE COURT:  Thank you.  You're excused.
  20            (Witness excused)
  21            THE COURT:  Any witnesses for the defendants?
  22            MR. GOLD:  Oh, excuse me.
  23            MR. GARBUS:  That's the end of live witnesses.  We
  24   have some depositions of witnesses who will not be here, but I
  25   guess that becomes the subject of later discussion.
                                                                1115
   1            THE COURT:  Right.  Mr. Gold, will there be any
   2   rebuttal witnesses?
   3            MR. GOLD:  There will not be, your Honor.
   4            THE COURT:  Okay.  Well, then I think the logical
   5   order is to take up first the plaintiffs' and then the
   6   defendants' documents that remain unresolved and conclude the
   7   taking of evidence.  Mr. Gold.  Mr. Sims.
   8            MR. SIMS:  Yes.  First of all, I would just like to
   9   correct the record if I might.  On page 794, on July 20th, we
  10   had moved in four exhibits, and they were 1.13, 1.14, 1.15 and
  11   1.16, and the record reflects 113, 114, 115 and 116, and I'd
  12   like the record to be correct.
  13            THE COURT:  Tell me the page number.
  14            MR. SIMS:  794, I believe.  July 20th.
  15            THE COURT:  July 20th.
  16            MR. SIMS:  July 20.
  17            THE COURT:  Okay.  That's better.  The page hasn't
  18   come up yet.  All right.  Is there any dispute about it, first
  19   of all?  Mr. Garbus.
  20            MR. GARBUS:  Excuse me.  Mr. Atlas will handle this.
  21            THE COURT:  Mr. Atlas.
  22            MR. ATLAS:  Certain dates were not --
  23            MR. SIMS:  Okay.  There were four exhibits moved in
  24   on the 20th, which were 1.13 through 1.16, and the transcript
  25   refers to them as 113, 114, 115, and 116.
                                                                1116
   1            MR. ATLAS:  Those are the demonstratives.
   2            THE COURT:  Look, my notes reflect that what --
   3            MR. SIMS:  They were the hacker magazines.  I'm
   4   sorry.
   5            THE COURT:  My notes reflect at that time what were
   6   113, 114, 115, 116, 1.11, 1.1, 1.2, 1.4, 1.6, 1.8, 1.7, 1.5,
   7   1.3, and 1.12.
   8            MR. SIMS:  They should all have a decimal point after
   9   the first one.  They were each quarterly magazines that Mr.
  10   Garbus gave to the witnesses.
  11            THE COURT:  So it's not Plaintiffs' 113.  It's 1.13
  12   through 1.6.  Any disagreement with that, Mr. Atlas?
  13            MR. ATLAS:  No.
  14            THE COURT:  Okay.  That correction is made.
  15            MR. SIMS:  Secondly, we had given last Wednesday, I
  16   think, a list of plaintiffs' exhibits that we wanted to move
  17   in, and the defendants gave me a list of objections, and they
  18   stated positions with respect to all of the exhibits on our
  19   list, other than the last three.
  20            And I've typed this up, and I've given it to Mr.
  21   Atlas this morning.  And, I think, assuming that it's
  22   complete -- or we can correct it -- one way to do this would
  23   be to mark this, and then you'll have -- we can do it another
  24   way as well.  But this is a list of exhibits we want, together
  25   with those objections that they have, and I think there are
                                                                1117
   1   just three more to go.
   2            THE COURT:  Just hand it up.
   3            MR. ATLAS:  On 62, you have our objection being
   4   hearsay.  I'm told that what's missing is we object as to
   5   completeness as well.
   6            MR. SIMS:  62.
   7            MR. ATLAS:  That's fine.
   8            MR. GARBUS:  Your Honor, would it help you if we did
   9   this outside of your presence and just give you the exhibits
  10   or would that --
  11            THE COURT:  I'm afraid that I'll get 1500 documents
  12   that way.
  13            MR. SIMS:  I think we can do it pretty efficiently.
  14            THE COURT:  All right.  Hand this up, and let's get
  15   it resolved.  I appreciate the suggestion, but I would just
  16   assume get this nailed down once and for all.
  17            All right, Mr. Sims, hand it up.  Let's go.
  18            MR. SIMS:  Here it is, your Honor.  I think it should
  19   be marked for convenience as 132.
  20            THE DEPUTY CLERK:  Mark this one 132?
  21            MR. SIMS:  Your Honor, would you like it as an
  22   exhibit?
  23            THE COURT:  It's 132 for identification.  Let me just
  24   look at it.
  25            (Pause)
                                                                1118
   1            THE COURT:  All right.  So the following are received
   2   without objection.  Plaintiffs 1, Plaintiffs 4, Plaintiffs 28,
   3   Plaintiffs 51 through 55, inclusive, Plaintiffs 64, 69, 72,
   4   79, 126 and 129.
   5            (Plaintiffs' Exhibits 1, 4, 28, 51-55, 64, 69, 72,
   6   79, 126 and 129 received in evidence)
   7            MR. ATLAS:  We provided counsel for plaintiffs a list
   8   of the exhibits we wanted to move in.  I haven't gotten
   9   objections yet, but --
  10            THE COURT:  Wait a second.  Before we get to your
  11   exhibits, let's deal with the rest of them.  All right.  Do I
  12   correctly understand, Mr. Atlas that as to Plaintiffs' 2,
  13   which consists of 2.1 through 2.34, physical exhibits, you
  14   object only to 2.1?  Is that right?
  15            MR. ATLAS:  Hold on.  Do you have the letter you sent
  16   to me?
  17            MR. SIMS:  I gave it to you this morning.
  18            (Pause)
  19            MR. ATLAS:  I believe in terms of 2, it was just
  20   given to me as Plaintiffs' Exhibit 2.  Those were the
  21   demonstrative exhibits, the photographs.
  22            MR. SIMS:  Your Honor, Exhibit 2 was a group of DVDs,
  23   commercially marketed, some from each plaintiff, and then
  24   Exhibit 3 were the copyright certificates.
  25            THE COURT:  Do you have any problem with any of them?
                                                                1119
   1            MR. ATLAS:  No.
   2            THE COURT:  Plaintiffs' Exhibit 2.1 through 2.34 and
   3   the corresponding certificates of registration, which are 3.1
   4   through, I assume, 34, whatever it is, are received.
   5            (Plaintiffs Exhibits 2.1 through 2.34 and 3.1 through
   6   3.34 received in evidence)
   7            MR. ATLAS:  For the record, we have, I believe,
   8   copies of the copyright forms.  We don't have copies of the
   9   films.  I suppose if we're going to put them in, we should
  10   have a set.
  11            MR. SIMS:  We could stipulate to the relevant fact.
  12   The relevant fact is simply that all of the plaintiffs have
  13   commercially marketed DVDs protected by DeCSS.  We have
  14   testimony of that, which are registered.  I mean, we don't
  15   need the Court to look at all the movies.
  16            THE COURT:  So stipulated?  So I'm not getting 34 DVD
  17   movies here?
  18            MR. SIMS:  We're glad to make them available.
  19            THE COURT:  Okay.  Next we have Plaintiffs' Exhibit
  20   5.  My exhibit book is blank.  There is no Plaintiffs' Exhibit
  21   5 here.
  22            MR. ATLAS:  We understand Plaintiffs' Exhibit 5 were
  23   copies of pirated CDs, is how they were described to me.
  24            MR. SIMS:  Your Honor, we'll withdraw Exhibit 5.
  25            THE COURT:  That takes care of that.  All right.  The
                                                                1120
   1   next objection as noted is Plaintiffs' 59.  What's going on
   2   here?
   3            MR. SIMS:  Your Honor, 59 through -- do you have the
   4   exhibit list, your Honor, or not?  59 through 73, whichever of
   5   those are on this list, were all web pages that were attached
   6   to the Boyden declaration.  I had an agreement with Mr.
   7   Hernstadt that all of those exhibits could come in.  We were
   8   discussing the separate question as to whether the allegations
   9   and the affidavit could come in.
  10            We finally decided at the time Mr. Boyden was brought
  11   up not to put him on with respect to the allegations in his
  12   affidavit on reliance of Mr. Hernstadt's agreement that the
  13   exhibits, which are simply web pages, would come in, and we
  14   would have a stipulation of authenticity with the other side
  15   that we've signed.  I believe they've signed, and I think --
  16   I'm not sure the record reflects that stipulation.
  17            If I might ask, maybe this would be an appropriate
  18   place to get the stipulation of authenticity on the record,
  19   and then I can't imagine that there's a problem with these web
  20   pages.
  21            MR. HERNSTADT:  Your Honor, we agreed that rather
  22   than require Mr. Boyden to come in up here and look at the
  23   screen and say this is a screen shot, that we would accept the
  24   representation that that is what he would say, and the screen
  25   shot could come in for what they were, which is a screen shot
                                                                1121
   1   of a particular web page on a particular date.
   2            THE COURT:  So I take it there's no objection to any
   3   of 59 through 73 to the extent that they're offered as screen
   4   shots of the web pages?  They're dated as of the dates they
   5   were taken.  Correct?
   6            MR. HERNSTADT:  Correct.
   7            THE COURT:  Okay, now -- and then I assume further
   8   that the question of whether anything that may appear on them
   9   is to be considered for the truth is going to be considered
  10   under the broad analysis that we discussed previously, which
  11   I've asked you for briefing?
  12            MR. SIMS:  Yes.
  13            THE COURT:  Mr. Hernstadt.
  14            MR. HERNSTADT:  Yes.
  15            THE COURT:  So that takes care of 59 to 73.  My law
  16   clerk has just handed me a note to remind you that the
  17   deadline I established last week, having gone without
  18   objection, I'm taking notice of the specific paragraphs of the
  19   Microsoft findings that I alerted you to.
  20            MR. SIMS:  Your Honor, we had actually said it was
  21   all right, and with respect to the Linux matter, paragraph 50
  22   in that opinion relates to Linux.
  23            THE COURT:  Yes.  I'm familiar with that.
  24            MR. SIMS:  And we don't have any objection to
  25   paragraph 50.
                                                                1122
   1            MR. GARBUS:  Your Honor, I would like to take a look
   2   at it if I can and get back to you.  May I?  Thank you.
   3            THE COURT:  Okay.  We'll move ahead while you take a
   4   look at it.
   5            MR. GARBUS:  I don't see how we could have an
   6   objection to it anyway.  It's a court objection.
   7            THE COURT:  Of course you can have an objection to it
   8   as a matter of fact.  Courts make all sorts of funny findings
   9   of facts as I'm told.
  10            MR. ATLAS:  74, I believe.
  11            THE COURT:  74.  Mr. Sims.
  12            MR. SIMS:  Your Honor, if I could go briefly out of
  13   order.  77 and 93 were attached to the deposition of Mr.
  14   Kenswil, which we're offering. he's unavailable.  We've
  15   offered it.  He's a music industry executive.  He's talking
  16   about the sorts of harm that can arise.  77 and 93 were
  17   testified to in the deposition, which we'll offer in a bit, as
  18   providing the bases in part of his opinion, and, therefore,
  19   they come in, I believe, under 703 for that purpose as you
  20   ruled with respect to other matters.
  21            I don't recall actually that he testified that he
  22   relied on 74 through -- and 75 and 76, so I guess --
  23            THE COURT:  So you're withdrawing 74 to 76?
  24            MR. SIMS:  Yes.
  25            THE COURT:  93 and 77.
                                                                1123
   1            MR. SIMS:  And 93.
   2            THE COURT:  And 93.  Any objection to they're coming
   3   in under 703 for the limited purpose that it so contemplates?
   4            MR. ATLAS:  I don't have a recollection that the
   5   witness testified he relied on them.  They were provided in a
   6   packet by Mr. Gold of things that he relied upon or he would
   7   be asked about.  If the transcript reflects that he relied on
   8   them, I guess I would have no objection to they're coming in
   9   for that limited purpose.
  10            THE COURT:  I'm going to take them in for that
  11   limited purpose subject, of course, to the predicate being
  12   laid in the transcript.
  13            (Plaintiffs' Exhibits 77 and 93 received in evidence)
  14            MR. ATLAS:  I guess I have a separate objection to
  15   his testimony all together, as well as these exhibits.  It's a
  16   different case.  It's a music case.  I think what may or may
  17   not have happened in the music case with Napster is not
  18   relevant to what's before us now.
  19            THE COURT:  You want to respond to that?
  20            MR. SIMS:  Sure.  He testified in the deposition
  21   about the quickness, the speed with which this new technology
  22   began causing substantial harm.  And since, I think, one of
  23   the issues here is the reasonable apprehension of harm that
  24   the plaintiffs face, I think his testimony is relevant to that
  25   issue.
                                                                1124
   1            THE COURT:  All right.  I'm going to take it for what
   2   it's worth, but I'm not sure it's worth much.  Okay that takes
   3   us to 92.  What about 92, Mr. Sims?
   4            MR. SIMS:  92, I think, I do not recall that he
   5   expressly -- it's the same thing.  I don't recall that he
   6   expressly relied on it.
   7            THE COURT:  So it's withdrawn.
   8            MR. SIMS:  Yes.
   9            THE COURT:  Okay, 93.
  10            MR. SIMS:  We've just covered.  It was 93 and 77 that
  11   I believe you did rule in.
  12            THE COURT:  96.
  13            MR. SIMS:  That is the deposition of Mr. Corely as
  14   designated.  I believe we moved that in some days earlier.  If
  15   not, we would certainly move it in as a completion of the
  16   cross-examination under the ruling that you made, I believe,
  17   last week.
  18            THE COURT:  Any objections to 96?  While you think
  19   about that, Mr. Atlas, you've got a couple hundred pages of
  20   material here, Mr. Sims.  Now -- maybe 400.  I mean, do you
  21   really want me to read this?  I'm serious.  I mean, we had the
  22   man on the stand.  Is there anything in there that I need to
  23   read to decide this case?
  24            MR. SIMS:  There are admissions in there, your Honor.
  25   I mean, as I understood the rulings you had made, it was that
                                                                1125
   1   a party couldn't call its own witness and then dump in, if you
   2   would, the deposition, but that with respect to a witness
   3   called by the other side, that could be added in terms of --
   4            THE COURT:  Well, sure.  But haven't you picked out
   5   the gems, or is that what these little black lines in the
   6   margin mean?
   7            MR. SIMS:  Well, with respect to every deposition
   8   that's been handed to you, you're getting a complete
   9   transcript, but there are lines on the side that are the
  10   portions designated.
  11            THE COURT:  I see.
  12            MR. SIMS:  In some of them, there's no distinction
  13   between who designated because it doesn't really matter.  So
  14   it's not that the whole deposition is being offered.  It's
  15   just the pieces that have been marked which comprises the
  16   markings by both sides.
  17            MR. ATLAS:  I believe we're objecting to portions of
  18   their designations, but I believe that would be reflected
  19   before.
  20            THE COURT:  Pardon me.
  21            MR. ATLAS:  In what we are submitting.
  22            MR. SIMS:  Your Honor, we might be able to pare down
  23   depending on the rest of the rulings here.
  24            THE COURT:  Look, for the sake of wrapping this up,
  25   I'll take the designated portions of 96 subject to whatever
                                                                1126
   1   objections have been made.  And if I don't in the course of my
   2   findings rely on something in 96 or any other deposition, you
   3   should just assume it's not in if it's objected to.
   4            MR. ATLAS:  Your Honor, I don't know whether Exhibit
   5   96 reflects our objections to the testimony.  Does it?
   6            THE COURT:  Not that I see, other than the form
   7   objections, of course.
   8            MR. ATLAS:  I think Mr. Rollings who handle the
   9   depositions objected to some of the portions that you tried to
  10   get in.  I just want to make sure before they go to the Court.
  11            MR. SIMS:  Your Honor, there's an index in the front.
  12   If Mr. Rollings has given us a revised version of that, that
  13   has a few more objections on it, I have no objection.
  14            THE COURT:  There's nothing here.  The index in the
  15   front just includes plaintiffs' designations.
  16            MR. SIMS:  And there's no objections.
  17            THE COURT:  Correct.
  18            MR. SIMS:  I don't have a problem if it's a
  19   mechanical problem that you don't have them in court.
  20            MR. ATLAS:  I mean, we could present, if the Court
  21   wishes, depositions, color marks showing who objected to
  22   what -- I think Mr. Rollings -- well --
  23            MR. SIMS:  It is the defendants' testimony in case.
  24            THE COURT:  I know.  Look --
  25            MR. ATLAS:  I think we have designations to which we
                                                                1127
   1   objected to and, I could provide the Court with that
   2   information.
   3            THE COURT:  Do that.  Okay, fine.  That takes care of
   4   96.  97?
   5            MR. ATLAS:  I think that was actually offered into
   6   evidence.  I think even accepted at one point. =20
   7            THE COURT:  It looks very familiar.
   8            MR. ATLAS:  The one that had the words at the bottom.
   9            MR. SIMS:  I'm sorry.  97 is in evidence on the 18th.
  10            THE COURT:  So, 97 is in.  98.
  11            MR. ATLAS:  97 is in with an objection to those words
  12   that have been inserted by the witness.
  13            THE COURT:  And then I think the witness testified to
  14   the words, or whatever the transcript shows, it shows.
  15            MR. ATLAS:  Fine.
  16            THE COURT:  98, what is this?  This is the download
  17   of all the links on the Joint 2600 or something else?
  18            MR. SIMS:  It's a sample of those, your Honor.
  19            THE COURT:  Is there any objection on 98?
  20            MR. ATLAS:  I think for completeness, it's probably
  21   hearsay.
  22            MR. SIMS:  I think the stipulation of authenticity
  23   covers it, your Honor.
  24            MR. ATLAS:  Well, it's not just links.  There's also
  25   a lot of text.  Stop DMCA.  Stop download here.  I guess I
                                                                1128
   1   don't know what they're trying to get it in for.
   2            MR. SIMS:  It's not offered for the truth.  It is
   3   what it is, and I think it's relevant to questions.
   4            THE COURT:  I'm taking it on that limited basis.
   5            (Plaintiffs' Exhibit 98 received in evidence)
   6            THE COURT:   Okay.  Moving right along.  127, kenswil
   7   deposition.
   8            MR. SIMS:  Yes.  If your Honor wants to take the
   9   depositions -- well, these are the depositions we're moving
  10   in.  Mr. Kenswil is the music executive that I referred to
  11   earlier.  We took his deposition.  We established on the
  12   record that he would be unavailable.
  13            THE COURT:  All right.  So that's subject to the
  14   ruling I already made.
  15            MR. ATLAS:  We have no objection to the entire
  16   testimony coming in, but we've noted that --
  17            THE COURT:  Yes, I understand.  I'm just not going to
  18   resolve it right now.  I'm going to take it, and if it's worth
  19   something  -- but I understand your relevance objection, and I
  20   am not supposed to be trying the music case here.  Okay.
  21            MR. ATLAS:  We also designated an -- I guess we
  22   objected to portions of Mr. Kenswil's deposition, and in
  23   addition to relevance, I don't know whether those are
  24   reflected on what your Honor has.
  25            THE COURT:  They are not.
                                                                1129
   1            MR. SIMS:  I don't have any problem with their
   2   substituting a copy.
   3            THE COURT:  You'll get me these objections by
   4   tomorrow.
   5            MR. GARBUS:  I have looked at section 50, and I do
   6   object to it, paragraph 50.
   7            THE COURT:  If you'll pass it back to me, I will see
   8   if it's something that's worth taking further discussion.  All
   9   right.  If you don't want it, you don't want it.  I think your
  10   witnesses basically testified to most of it today.
  11            MR. GARBUS:  Some of it.
  12            THE COURT:  That issue is closed.  Okay.  130 and 131
  13   I do not have.
  14            MR. SIMS:  We've both been working on this the last
  15   few days.  The one is for the deposition of Rick Burns that
  16   was taken during the trial, if you'll recall, your Honor, and
  17   the other is that during the trial deposition of Professor
  18   Ramadge, with respect to the demonstration that he did and I
  19   think -- I think we can both give your Honor those
  20   designations with whatever objections we have in the way we
  21   will with respect to any other.
  22            THE COURT:  Okay.  I will take those on the same
  23   basis as all the other depositions.  I take it that's the end
  24   of plaintiffs' case.
  25            MR. SIMS:  Yes, your Honor.  Thank you.
                                                                1130
   1            THE COURT:  Okay.  Mr. Atlas, you're up.
   2            MR. ATLAS:  Do the documents first, and then we'll
   3   deal with the deposition afterwards.
   4            THE COURT:  Do the documents first.
   5            MR. ATLAS:  It may not be as easygoing as with
   6   plaintiffs' exhibits.  Where's the box?
   7            Well, what I'll present the Court with is a box of
   8   documents that we would like to offer on our case.  I've got
   9   an updated master exhibit list of everything that we had
  10   originally designated, and then I have a shortened list of
  11   just what we're dealing with now.  I don't know whether this
  12   many be helpful to you.  I'm happy to provide to the Court
  13   another inch and a half of paper.  You could throw it away if
  14   you want.
  15            THE COURT:  Here we are in a paperless society.
  16            MR. ATLAS:  This is just what we're dealing with now.
  17   That's all that's relevant for today.
  18            MR. SIMS:  Your Honor, if I might, we were provided
  19   with their list, I think, on disk, and we've printed it out
  20   and added in the "objection" column all of our objections.
  21   I'm glad to go --
  22            THE COURT:  Why don't we swap.
  23            MR. SIMS:  Here it is, but unfortunately it's my only
  24   copy.  Can I get a copy of it?  I have it on the machine, but
  25   if I give it to you, I won't have it.  It was just completed
                                                                1131
   1   early this morning.
   2            MR. ATLAS:  I haven't seen it.
   3            THE COURT:  Well, with all due respect Mr. Sims, I
   4   don't think this is really going to help me very much.  Are
   5   there any exhibits on here you don't object to?
   6            MR. SIMS:  I believe there are a few that we don't
   7   object to, yes.
   8            THE COURT:  Okay.  I see them.  They're fairly
   9   jumping out at me.  Defendants' Exhibit CS is received without
  10   objection.
  11            (Defendants' Exhibit CS received in evidence)
  12            THE COURT:  That one I see.  Defendants' Exhibit FH
  13   is received without objection.
  14            (Defendants' Exhibit FH received in evidence)
  15            MR. ATLAS:  Your Honor, I'm told that we have two
  16   more exhibits.
  17            THE COURT:  Let me just -- does that exhaust the ones
  18   that aren't objected to?
  19            MR. SIMS:  I'm not sure, your Honor.  The ones that
  20   are in yellow, we've never gotten a copy of.  So I haven't
  21   been able to formulate that position one way or the other.
  22            THE COURT:  Well, that does it out of this monster
  23   list.  Those are the only ones that are no objection.
  24            MR. ATLAS:  Our task is much easier now.  We have two
  25   exhibits which are not on that list, and I apologize for the
                                                                1132
   1   lateness of the list.  These were two documents that were
   2   shown to Mr. Kenswil.  Our position is that they complete the
   3   exhibits that he wishes to offer for his deposition, the
   4   things that he allegedly relied on.  I would ask that these be
   5   admitted also to counter those to the extent the Court wishes
   6   to deal with those issues.  It's Court Exhibit CCR and Exhibit
   7   CCS.  I'll give a copy to Mr. Sims.
   8            THE COURT:  You know, frankly, gentlemen, I'm
   9   virtually at a loss.  I figured there are about 150 exhibits
  10   on this page or these pages.  There are no descriptions of any
  11   of them.  Can't you people work this out?
  12            MR. SIMS:  Your Honor, we tried.
  13            MR. ATLAS:  Well, we haven't -- I even gotten your
  14   objections to the documents.  I'm happy to spend a day and try
  15   to go through some of this stuff.
  16            MR. SIMS:  I was hoping to get the list on Saturday
  17   morning.  I had a lot of people waiting around to work on
  18   them.  Given when we finally got them, this is the best we
  19   could do.  We might make some progress if we could spend any
  20   time together, but given when we got the lists --
  21            MR. ATLAS:  You want a hand?
  22            THE COURT:  Oh, for God sake.  Come on, guys.
  23            MR. ATLAS:  I have two more.
  24            THE COURT:  You've got Professor Appel's affidavit in
  25   here.
                                                                1133
   1            MR. ATLAS:  The declarations are in there.  They've
   2   been marked.
   3            THE COURT:  There's all kinds of stuff in here.
   4            MR. SIMS:  Your Honor, much of what's in that box is
   5   stuff that under the rulings you've already made generically
   6   shouldn't be there at all, including declarations of various
   7   witnesses they've put on the stand.
   8            THE COURT:  I mean, to quote Judge Ward in another
   9   case, "The purpose of evidence is to persuade, not to
  10   inundate."
  11            All right, look, you people are going to have to try
  12   to reach agreement on this or, at least, to narrow down the
  13   list in light of rulings that have been made at trial.  I'll
  14   resolve whatever you can't resolve, but, I mean, my reaction
  15   in looking at all this is that it seems like overkill, and
  16   that in light of what I've done so far, you ought to be able
  17   to resolve these things.
  18            MR. ATLAS:  I mean, having been the one that went
  19   through this weekend all seven of our boxes, I speak from
  20   personal experience.
  21            THE COURT:  You definitely get the purple heart.
  22   There's no question about that.
  23            MR. ATLAS:  What I tried to do --
  24            THE COURT:  You've got an affidavit in here from
  25   Professor Samuelson.  I mean, if he's not testifying live, the
                                                                1134
   1   objection is hearsay.  It's sustained, right?  Is there any
   2   other basis to do this?  Right?
   3            MR. ATLAS:  We'll take the documents back.
   4            THE COURT:  Okay.  Look, I'm not trying to deprive
   5   you of any evidence that's probably in here.  Just, please,
   6   edit first, and really I understand you all have been working
   7   very hard.  I do.  Okay.
   8            MR. ATLAS:  My wife is very forgiving.
   9            THE COURT:  Oh, yes, I remember how forgiving my wife
  10   used to be.  Okay, let's deal with this CCR and CCS.  Talk to
  11   me, Mr. Atlas, about CCR.
  12            MR. ATLAS:  The studies that Mr. Kenswil referred to,
  13   in such relied upon for his testimony, dealt with how much
  14   money the music industry would be losing as a result of the
  15   MP3 and the Napster issues.  These studies, which were also
  16   submitted in the Napster case in California, counter that and
  17   show that, in fact, Napster has spurred sales in the music
  18   industry.  It's the flip side to what Mr. Kenswil was
  19   testifying about.
  20            THE COURT:  Well, is this material that Mr. Kenswil
  21   relied on in coming to his opinions, or is this a rebuttal of
  22   Mr. Kenswil?
  23            MR. ATLAS:  I don't believe he relied on it.  The
  24   argument would be that it is a rebuttal or is more so offered
  25   as completeness to the materials that they want in.
                                                                1135
   1            MR. SIMS:  I think under Rule 703, your Honor, that
   2   just -- that dog won't hunt.
   3            THE COURT:  You spent too much time in Texas.  Look,
   4   I need to understand exactly what I'm dealing with here, Mr.
   5   Atlas.
   6            MR. ATLAS:  These were not documents he relied on.
   7            THE COURT:  These are not documents he relied on.  So
   8   why aren't they simply hearsay?  They're out-of-court
   9   statements by declarants offered for the truth of the
  10   statements made, because you claim that the truth of their
  11   statements rebuts a witness who testified under oath in his
  12   cross-exam.
  13            MR. ATLAS:  I also disagree with that.  The point, I
  14   guess, I'm making is that if your Honor is going to consider
  15   some of these issues, your Honor is taking the documents Mr.
  16   Kenswil relied upon for what they were worth, I would ask that
  17   this presents a contrary view that may be useful to the Court
  18   if the Court wants to --
  19            THE COURT:  That isn't the point.  There are rules of
  20   evidence.  Kenswil was deposed, as I understand it, and he was
  21   offered for cross-examination.  Am I right?
  22            MR. SIMS:  Absolutely.
  23            THE COURT:  And he gave an opinion, and he said his
  24   opinion was based on certain things.  Am I correct?
  25            MR. SIMS:  Yes.
                                                                1136
   1            THE COURT:  And among the things he said the opinion
   2   was based on was materials that the plaintiffs offered in
   3   evidence.  Am I right, Mr. Atlas?
   4            MR. ATLAS:  Yes.
   5            THE COURT:  And they offered those materials upon
   6   which he relied, not for the truth of the matters and the
   7   materials, but to illustrate the opinions and the basis for
   8   the opinion.  Am I right so far?
   9            MR. ATLAS:  I see where you're going.
  10            THE COURT:  Okay.  Objection sustained to CCR and
  11   CCS.  Okay, anything else?  You're going to try to work out
  12   the exhibits.  What else?
  13            MR. ATLAS:  We come to the depositions, and I guess
  14   over the weekend, I got some letters from Mr. Sims and his
  15   team to the effect that certain deposition -- they were going
  16   to object to the admission of certain deposition testimony.
  17   They refer to certain rulings of the Court, that I was
  18   admittedly not here for the entire trial, but it was not my
  19   understanding that the Court had made those rulings.  But I'll
  20   let him speak to the issue.
  21            MR. SIMS:  Your Honor, I believe you ruled in
  22   accordance with what I think is clearly the prevailing law,
  23   that to the extent that they called witnesses to the stand,
  24   including, for example, the witnesses that were illustrative
  25   this morning, after they're done, they just can't move in
                                                                1137
   1   designations of those people's deposition.
   2            And under that ruling, if it is, in fact, to be
   3   adhered to, the following designated depositions that they've
   4   offered should be excluded.  Abelson, Appel -- Abelson is a
   5   different category, I'm sorry.  I'll get to Abelson in a
   6   moment.  Appel, who testified this morning.  Craig, who
   7   testified this morning.  DiBona, who testified this morning.
   8   Felton, who testified earlier.  Einhorn, Pavlovich, Touretzky,
   9   Ramadge, leaving aside the supplemental deposition, and
  10   Peterson.
  11            THE COURT:  Now, do you have a reference in the
  12   transcript to where you say I made this ruling?
  13            MR. SIMS:  I don't have a page reference, but I
  14   remember precisely there was a witness they called earlier on.
  15   I think it was Peterson.  I think it was the first expert.
  16            MR. HERNSTADT:  Felton.
  17            MR. SIMS:  Professor Felton.  And after the cross was
  18   done on redirect, they then tried to add in the deposition and
  19   declaration.
  20            MR. ATLAS:  I was here for that.  It was the
  21   declaration.  As I recall, the reason your Honor didn't let it
  22   in was it was not within the scope of the -- we tried to get
  23   it in on redirect, and what your Honor said was that it wasn't
  24   dealt with on cross.
  25            THE COURT:  Okay.  I do remember that now.  Now,
                                                                1138
   1   look, Rule 32 sets out the parameters as to when you can offer
   2   a deposition.  Now, if I'm understanding Mr. Sims correctly,
   3   he is saying that none of the ones he ticked off come within
   4   Rule 32.  Am I right, Mr. Sims?  That's your position?
   5            MR. SIMS:  Exactly, your Honor.
   6            THE COURT:  So, Mr. Atlas, what about that?
   7            MR. ATLAS:  Part of this, I think, was the nature of
   8   the trial, was to try and get the witnesses on, to try and be
   9   as quick as possible.  I had understood that we had permission
  10   to put in depositions to cut down on some of the examinations,
  11   both on direct and on cross.  I think putting in these
  12   transcripts will do that.  I don't know that it's clearly
  13   prohibited by Rule 32, and I think there's also an exception
  14   in Rule 32 for exceptional circumstances.
  15            THE COURT:  Well, what makes this exceptional?
  16            MR. ATLAS:  In terms of keeping the trial time low
  17   and trying to get the witnesses on and off.
  18            THE COURT:  Look, you guys told me at one point that
  19   this was a three- to four-week trial, and I didn't raise any
  20   objection to that.  I'm glad you wound up sooner, but nobody
  21   stopped you from putting in whatever you wanted to put in.
  22            Look, if at any point in this trial I indicated that
  23   I was going to take deposition testimony of a witness that was
  24   not otherwise admissible under Rule 32, for the purpose of
  25   economy, I will certainly live by the ruling, but somebody is
                                                                1139
   1   going to have to show it to me.  Otherwise I think Mr. Sims is
   2   within his rights.  And if you want to think about it
   3   overnight and look in the transcript, that's okay.
   4            MR. ATLAS:  I know --
   5            THE COURT:  My deputy is trying to tell me something.
   6            (Pause)
   7            THE COURT:  Well, my deputy is saying she thinks she
   8   may remember something in the final pretrial conference.  I
   9   just don't.
  10            MR. ATLAS:  Yeah, I think --
  11            THE COURT:  Can we get the transcript?  It's the July
  12   12th transcript.
  13            MR. GARBUS:  I believe you said, Mr. Garbus, thank
  14   you for the solution.  That was my memory.  Some solution.
  15            THE COURT:  Look, obviously what I'm concerned about
  16   here is that it would be unfair for you to have offered
  17   somebody on direct, put forward a fairly direct and narrow
  18   direct, have Mr. Sims do the cross by direct, and then to have
  19   him get sandbagged with hundreds of pages of testimony after
  20   the fact.  If that's what's happened, if that's what's being
  21   offered, I'm not going to allow it.
  22            MR. SIMS:  Your Honor.
  23            MR. ATLAS:  There's no sandbagging.  All of the
  24   deposition designations were provided before the trial
  25   started.
                                                                1140
   1            THE COURT:  No, I understand that, but it was not
   2   meant in a pejorative way.  Simply meant to describe surprise
   3   borne of the fact that he had a right, perhaps, to rely on the
   4   scope of your direct.
   5            MR. ATLAS:  These were depositions conducted by the
   6   plaintiffs.
   7            THE COURT:  That doesn't matter.  They're entitled to
   8   take discovery in depositions.  While my law clerk is getting
   9   that transcript, let's go on to depositions in other
  10   categories.  Are there any?
  11            MR. SIMS:  There are a few.  Professor Abelson at MIT
  12   would be usable -- I guess it is usable under Rule 32.  So we
  13   don't have any objection to the designated Abelson.
  14            THE COURT:  Okay.  So let's mark it as an exhibit,
  15   and it will be Defendant's Number 1?
  16            MR. ATLAS:  I know we're not dealing with it now, but
  17   I have a note that there is one other pieces of business
  18   before we finish all this up.
  19            Mr. Rollings put together the binders.  I believe
  20   he's better qualified to go through this.
  21            MR. ROLLINGS:  Each deposition is indexed as to what
  22   would have been designated, what would have been objected to,
  23   what has been counterdesignated, and if there are any
  24   objections, they're objections to what is indicated.  Each
  25   transcript sets forth all the designations.  And so those are
                                                                1141
   1   cross-referenced and whose objecting to what.
   2            There are three volumes.  We had Tab 1 through Tab
   3   24.  So on each volume there is an index of the exhibit
   4   number, which corresponds to each deponent or deposition being
   5   offered.  It is very self-explanatory if you go through it.
   6            THE COURT:  So there is an exhibit number attached to
   7   each particular deposition.
   8            MR. ROLLINGS:  Each has an exhibit number on it, and
   9   it's indexed at the beginning of each volume.
  10            THE COURT:  So, Mr. Atlas, what exhibit is Abelson?
  11            MR. ROLLINGS:  It's Tab 1.  So the exhibit --
  12            THE COURT:  I see.  All right.  What's the next
  13   defendants' exhibit number?
  14            MR. ATLAS:  Pardon me.
  15            THE COURT:  What is your next exhibit number?
  16            MR. ATLAS:  What's the next exhibit number?
  17            THE COURT:  We don't even need it.  The three binders
  18   are collectively market Defendants' Exhibit XXX for
  19   identification.  I'm taking the Abelson's deposition subject
  20   to the objections and rulings on the objected parts.  What
  21   besides Abelson is not objected to?
  22            MR. SIMS:  Is not objected to?
  23            THE COURT:  Not objected to.
  24            MR. SIMS:  There are designated depositions which
  25   reflect objections of the following witnesses to which they've
                                                                1142
   1   offered, and we don't object.
   2            THE COURT:  Shoot.
   3            MR. SIMS:  Burns, Schumann, Reider, Fisher, King, and
   4   Hunt.
   5            THE COURT:  All right.  I will take those seven
   6   deposition designations on the same basis as everything else.
   7            MR. ATLAS:  We have also Barbara Simons,
   8            THE COURT:  Pardon me.
   9            MR. ATLAS:  The depositions of Barbara Simons, who
  10   was going to be an expert for our side, but did not testify.
  11   Those depositions are designated.
  12            THE COURT:  They're in the XXX binders.
  13            MR. ATLAS:  Yes.  Bruise Schneier.
  14            THE COURT:  So that's the next category, right?
  15            MR. SIMS:  I'm sorry, your Honor.
  16            THE COURT:  I'm asking, Mr. Atlas.
  17            MR. ATLAS:  There are several experts that did not
  18   come and testify in court.  Abelson, Schneier, and Simons were
  19   the three experts whose depositions we designated, but who did
  20   not come in to testify.
  21            THE COURT:  Abelson I already took.
  22            MR. ATLAS:  Correct.  Simons and Schneier.
  23            THE COURT:  Are there objections to Schneier and
  24   Simons?
  25            MR. SIMS:  There is an objection to Simons, your
                                                                1143
   1   Honor.  There is no establishment on the record that he was
   2   unavailable.
   3            MR. HERNSTADT:  I informed the plaintiff that he had
   4   informed us that he would not be able to come.  He's basically
   5   in San Jose and in Minneapolis, and we had put him on the
   6   list.  At the time of the deposition, they were also aware
   7   that we intended to call him, but that he had limitations on
   8   his schedule, that he might not be able to make it, and he
   9   informed us that he was not able to make it.  And I so
  10   informed the plaintiffs.
  11            THE COURT:  Okay, Mr. Sims, what do you have to say?
  12            MR. SIMS:  What I have to say, your Honor, is that I
  13   just checked with my colleagues at the table, and as far as we
  14   recall, we were advised last week that they wouldn't be
  15   calling him and, we think, for technical reasons, but that's
  16   not the same as establishing that he's unavailable.
  17            THE COURT:  Well, he's more than a hundred miles
  18   away, so Rule 32 is satisfied.  So your argument is you were
  19   told he wasn't going to be offered at all?
  20            MR. SIMS:  And we had cited to your Honor in an
  21   earlier brief a Delaware case establishing that with respect
  22   to experts, it's not simply where they are in the country, but
  23   they have to establish unavailability.
  24            THE COURT:  Well, how about that, folks?
  25            MR. HERNSTADT:  I informed plaintiffs that he was
                                                                1144
   1   unavailable.  They did not say, well, you'll have to establish
   2   his unavailability on the record.  They accepted my telling
   3   him that he wasn't going to be able to make it.
   4            MR. SIMS:  Your Honor, we haven't even designated the
   5   Schneier deposition precisely because we were told he wouldn't
   6   be presented, and I sent them a letter to which Mr. Atlas or
   7   Mr. Hernstadt referred to last week saying --
   8            THE COURT:  You can put all this argument on Schneier
   9   in two letters, not to exceed two pages, each tomorrow, and
  10   I'll simply rule on it.  What about Simons?
  11            MR. SIMS:  It's cumulative, your Honor, but other
  12   than that, we don't have an objection.
  13            THE COURT:  All right.  I'm taking Simons on the same
  14   basis as the others.  What other depositions?
  15            MR. SIMS:  There is a deposition they're offering of
  16   Rick Hirsch, who is a former MPAA employee who lives in
  17   Ardley, and I believe that under Rule 32, there is no basis
  18   for the introduction of that deposition.
  19            THE COURT:  Mr. Atlas.
  20            MR. HERNSTADT:  Rick Hirsch was the head of
  21   anti-piracy up until April of this year.  When we saw his
  22   deposition, the MPAA acted as an interceder and informed us
  23   that he lives half the year in LA and half the year in
  24   Washington, that he's bicoastal on his job and offered his
  25   deposition in California or here.
                                                                1145
   1            THE COURT:  Well, that was months ago.
   2            MR. HERNSTADT:  That was last month.  That was July.
   3            MR. SIMS:  At the time of his deposition, he moved to
   4   New York.  He so testified, and he's working for the ISTA
   5   downtown.
   6            THE COURT:  What does his deposition say about where
   7   he lives?  Presumably you have it right there, Mr. Atlas.
   8            MR. ATLAS:  I believe he said Rye.
   9            THE COURT:  Objection sustained.  What else?
  10            MR. SIMS:  Your Honor, they've offered the
  11   depositions of Michael Eisner and Jack Valenti.  Those we
  12   object to on grounds of relevance.  Relevance, your Honor.
  13            THE COURT:  All right.  I'm going to take them
  14   subject to ruling on that.  I mean, you know, I read Valenti,
  15   and my general recollection of it is that there's
  16   substantially nothing relevant.  But I'm not going to simply
  17   exclude the whole thing on the basis of that broad
  18   recollection.  So I'll look at it.  If I find anything
  19   relevant, I'll rely on it, and if I don't, consider that
  20   they're not in.
  21            MR. SIMS:  Your Honor, that completes, as far as I
  22   know, except that I would ask the Court for permission for us
  23   to just check the indexes that we've been exchanging with
  24   respect to objections, to make certain that the Court's copies
  25   have the most updated copies we each have.  If I could do that
                                                                1146
   1   with Anna or --
   2            THE COURT:  You're welcome to do that.  Now, let's
   3   come back to that other point about depositions.  The
   4   discussion at the pretrial conference about depositions was
   5   this.  Mr. Garbus said that with respect to long depositions
   6   of people like Schumann, who would be giving direct, he saw no
   7   purpose in repeating on cross lengthy cross-examination that
   8   he had done in their depositions, and that he wanted to put
   9   the depositions of those witnesses in in order to curtail the
  10   length of their cross.  And that's at page 41.
  11            And I went along with that idea on the following
  12   page.  Now, whose deposition were we talking about a few
  13   minutes ago?
  14            MR. GARBUS:  It was not one of the plaintiffs'
  15   witnesses.  It was something else, your Honor.
  16            MR. ATLAS:  The witnesses that we had called.  The
  17   experts that we had called and whether we could get our
  18   designations in on those witnesses.
  19            THE COURT:  If there's anything else in the record,
  20   please call to it my attention by tomorrow, but this is what I
  21   think I remember.  So that would imply that I will sustain the
  22   Rule 32 objections as to depositions of the people you called
  23   live.  Okay.  Anything else with respect to evidence?
  24            MR. ATLAS:  There's one other point.  I believe
  25   during one of the witnesses, we offered and it was accepted
                                                                1147
   1   the licenses of the DVD-CCA.
   2            THE COURT:  I believe you are right.
   3            MR. ATLAS:  And your Honor took it and filed it under
   4   seal.  I'd like to make a motion to unseal it.  As I
   5   understand, the copy of a declaration from John Hoy, who I
   6   understand runs the DVD-CCA, he filed an affidavit in the
   7   California action and attached as an exhibit, I think, a
   8   form -- one of the form DVD-CCA licensees.
   9            In reading through the documents, I think he had
  10   originally filed the affidavit and included the DeCSS code,
  11   which was a big brouhaha because he filed in it open court and
  12   then that aspect of it was sealed.  But as I understand, the
  13   license agreement --
  14            THE COURT:  You place all this reliance on these
  15   orders, and every year there is another classic case.  I mean,
  16   last year it was the SEC producing inadvertently their
  17   prosecution memorandum in a civil case.  The year before that
  18   the F.B.I. attached some super secret document out in Arizona.
  19   So this is this case's version.
  20            MR. ATLAS:  Anyway, the copy I have is Exhibit A
  21   sealed, Exhibit B sealed, and then Exhibit C is the restated
  22   DVD-CCA licensing agreement.
  23            THE COURT:  It looks like a blank form.
  24            MR. ATLAS:  The point is that -- yeah, it is blank,
  25   the exhibit that we have offered, and we've offered all of the
                                                                1148
   1   interim licenses among the exhibits that we have.
   2            THE COURT:  You didn't really.
   3            MR. ATLAS:  I did only because I couldn't read them.
   4   I wasn't sure if they were all identical.  And if I understand
   5   that they're identical, I'll pull them out.  I didn't want to
   6   take the chance that one said something different, because
   7   there was an original, and then there was a restated one and
   8   there are points in there.
   9            THE COURT:  I had a feeling that box was too heavy.
  10            MR. HERNSTADT:  Just to save Mr. Atlas on this point,
  11   it's not all of the licenses.  There are over a hundred
  12   licenses.  It's a selection of licenses for different
  13   purposes, for making hardware, for making players, for doing
  14   different things.  There are 12 different licenses, and it's a
  15   selection.  Maybe not as limited as it will be tomorrow.
  16            THE COURT:  All right.  Work on it.
  17            MR. ATLAS:  In any event, I would make a motion to
  18   unseal.
  19            THE COURT:  Write a letter with the other side
  20   responding, and I gather that you ought to copy the DVD-CCA
  21   lawyers on it.
  22            MR. SIMS:  They've been asking.
  23            MR. ATLAS:  Do they have an issue?
  24            MR. SIMS:  I don't know.  I know they sent letters,
  25   please, let us know.
                                                                1149
   1            THE COURT:  Okay.  Any other evidence to be
   2   presented?
   3            MR. SIMS:  Yes, we do.  Your Honor.  We would like to
   4   ask the Court to draw an adverse inference with respect to the
   5   defendant's harddrive in light of the refusal throughout the
   6   entire matter to produce any e-mails or letters from it or to
   7   comply with the Court's letters with respect to an
   8   investigation.
   9            THE COURT:  I'm not going to hear any argument about
  10   this now.  I've heard enough discovery in this case enough to
  11   last me a lifetime.
  12            MR. ATLAS:  One other deposition.  I'm told the
  13   deposition of Mr. Attaway was not addressed a few moments ago.
  14            THE COURT:  What about Mr. Attaway?  Who wants it in?
  15            MR. ATLAS:  We want it in.
  16            MR. HERNSTADT:  It was designated and
  17   counterdesignated, but it was inadvertently left out of the
  18   binder, and Mr. Attaway is one of their --
  19            THE COURT:  I know who he is.
  20            MR. HERNSTADT:  Okay.  And was a witness on their
  21   witness list who didn't testify.
  22            MR. ATLAS:  We'll provide that to the Court in a
  23   letter tomorrow.
  24            MR. SIMS:  We don't have any problem.
  25            THE COURT:  That will be XXY.  So mark it please.
                                                                1150
   1   You with me, folks?  XXY, Attaway's deposition designations.
   2   Any other evidence?  Going once.  Going twice.  Closed.  All
   3   right.
   4            Does anybody want any closing argument in this case?
   5            MR. GARBUS:  I think we were talking about submitting
   6   briefs certainly.  I think, perhaps, after the briefs are in,
   7   you might want to do that.  I don't know what your Honor's
   8   schedule is.  I don't feel any real need for it now.  Your
   9   Honor had posed questions to us at the very beginning, and it
  10   may be that we will resolve those issues.
  11            There were four questions.  I don't have them in
  12   front of me.  I think I would like to make after the briefs
  13   come in a closing argument, but that depends on your
  14   scheduling.
  15            THE COURT:  Well, my own disposition really is that I
  16   think I would rather hear the closing sooner rather than
  17   later, because we're almost familiar with the record now, if
  18   there's to be a closing argument.
  19            MR. GARBUS:  Your Honor, can I think on it and get
  20   back to you as to, at least, the necessity?
  21            THE COURT:  Yes.  And my thought was to do it later
  22   this week.  Now, as far as briefs are concerned, with the
  23   exception of three points that are bothering me in particular,
  24   I will, within limits -- assuming we can get the proper time
  25   frame -- leave the question of putting briefs in up to you.
                                                                1151
   1            We had mentioned two and possibly three of these
   2   issues during the course of the trial.  One is what, if
   3   anything, I were to do about an injunction here if I conclude
   4   that this horse is out of the barn already.  Something tells
   5   me there's ancient equitable maxim that I haven't been able to
   6   find this week to the effect that courts will not issue
   7   injunctions where to do so would be entirely futile.  I think
   8   we've talked about that.
   9            Secondly, I'm sure we talked about Summers v. Tise
  10   and its implications here.  And thirdly is whether and to what
  11   extent I properly may conclude from the evidence that's in the
  12   record that decoded DVD movies actually are available either
  13   over or through the internet.  That's essentially an
  14   evidentiary question.
  15            Now, beyond addressing those three questions, does
  16   anyone want to file a brief in this case?
  17            MR. GARBUS:  I think we would like to file a brief
  18   with respect to a pulling together of the legal arguments.  I
  19   think that we have -- our last brief, I think, was a reply
  20   brief I mentioned, June 14th, where we made speculations about
  21   what we thought the evidence and the law would be.  Since
  22   then, we've taken discovery and gone through this trial.  I'd
  23   like to prepare a document that I think represents that.
  24            I know your Honor doesn't want to delay it too much.
  25   I don't know -- I think I'd like to have a chance to go
                                                                1152
   1   through the facts and go through the briefs and go through the
   2   law, but I'm sensitive to your Honor's scheduling.
   3            THE COURT:  Mr. Gold, what's your pleasure?
   4            MR. GOLD:  Well, your Honor, but for the three issues
   5   your Honor has just described -- and when I think of the
   6   briefs on both sides, I think there has been an awful lot
   7   submitted to you and more than once on the remaining issues.
   8            So if we touch on them, it will be touching on them
   9   very briefly indeed, but these three issues, of course, we
  10   would like to brief.
  11            THE COURT:  All right.  Well, suit yourself.  We'll
  12   have a simultaneous exchange.  This is July 25th.  Can you get
  13   them for me by August 4th?
  14            MR. SIMS:  Yes, sir.
  15            MR. ATLAS:  Would it be possible to get --
  16            MR. GARBUS:  I think some of us -- is August 15th
  17   good for you?
  18            THE COURT:  Well, it isn't as good.  It isn't as
  19   good.  If you want more time, I'll give it to you.
  20            MR. GARBUS:  Yeah.  I think that our position,
  21   frankly, is that we've just absorbed the discovery.  We've
  22   absorbed the material at trial, and we would like to put
  23   together a document which we think is coherent and puts
  24   everything together.  Normally, I would ask for a good deal of
  25   time to do that.  I understand the Court's scheduling, but I
                                                                1153
   1   do feel that we should put together -- there have been some
   2   questions about whether we raised certain issues, whether we
   3   didn't raise certain issues.  I think be would like to have an
   4   opportunity to put our case together coherently.
   5            THE COURT:  Mr. Gold, what were you about to say?
   6            MR. GOLD:  Well, on the August 4th simultaneous
   7   exchange sounds wonderful to me, unless your Honor would make
   8   it August 3rd.  I believe that the shorter it is, the more
   9   focused these briefs will be and the more helpful they'll be
  10   to the Court, and the longer the time, the much longer the
  11   briefs are likely to be.
  12            THE COURT:  We're going to cut the baby in half.
  13   We're going to make it August 8th.  And a 35-page limit.  And
  14   let me give you a little guidance.
  15            I haven't really had a chance during the course of
  16   the last week to go back over the opinion in January in light
  17   of the evidence at trial.  Obviously, there was no record
  18   before me in January.  There was nothing from the defense at
  19   all, and there was very little from the plaintiffs compared to
  20   what's there now.
  21            But my tentative sense, from having listened this
  22   week and last with a lot of care, is that probably nothing
  23   much has changed with respect to the analysis of the DMCA
  24   itself.  I may be wrong in that, but that's my gut reaction
  25   here.
                                                                1154
   1            I think one thing probably has changed with respect
   2   to the constitutional analysis, and that is that subject to
   3   thinking about it some more, I really find what Professor
   4   Touretzky had to say today extremely persuasive and
   5   educational about computer code.
   6            Now, of course, which way that cuts is another
   7   matter, but I just don't think it's likely ultimately to prove
   8   tenable to say that computer code of any kind has no
   9   expressive content, source or object.  Which then gets you to
  10   the question of how then do you deal with it under the First
  11   Amendment.  I found myself wondering and I'm thinking out loud
  12   here, because I really want both sides to understand where my
  13   mind is going on this, because then they're going to focus
  14   more closely on what concerns me.
  15            I'm really in doubt as to whether saying that
  16   computer code is constitutionally protected speech goes very
  17   far toward answering the questions in this case.
  18            In the past, the Supreme Court has dealt with
  19   questions involving the regulation of expression essentially
  20   by fitting the particular kind of expression into various
  21   pigeon holes, fighting words, obscenity, conduct as contrasted
  22   with speech, commercial speech, and they've developed over the
  23   years various kinds of definitions that to one degree or
  24   another separate those different categories.
  25            I'm really not sure that paradigm fits this case.  Or
                                                                1155
   1   if it does, where exactly -- which is the right pigeon hole
   2   for this case.  I reread the draft card burning case over the
   3   lunch hour, and the Supreme Court there said that although the
   4   burning of the draft card was obviously intended as
   5   expression, the government had the right to prohibit it, to
   6   criminalize it because of the governmental interest in running
   7   the draft.  I remember what I thought about that in 1968.  Not
   8   that I'm telling anybody.
   9            The speech conduct distinction they draw in that
  10   case, I think, one fairly can say is one that is debatable,
  11   and they put the expressive draft card burning purely into the
  12   conduct box, so that it could be regulated even though it was
  13   obviously expressive.  There's some kind of analogy here.  So
  14   I share those views.  They're very unformed.  They're very
  15   tentative.  But I guess what I'm intending to communicate by
  16   this is that rhetoric is not really likely to cut it very
  17   much.  I'm really very interested in the guts of this, and for
  18   what it's worth, there you have it.
  19            Okay.  Anything else?  I do think it appropriate to
  20   thank all counsel because I know what a huge personal effort
  21   getting ready has been.  Nobody should think that I was ever
  22   unmindful of that, and I appreciate that for everybody.
  23            Okay, our business is concluded.  I'll hear from you
  24   on these other odds and ends of documents from you tomorrow.
  25   Now, to whatever extent I don't have the exhibits, I need
                                                                1156
   1   them.
   2            MR. GOLD:  Thank you, very much.
   3            MR. ATLAS:  Thank you, your Honor.
   4            THE COURT:  Thank you, folks.
   5                      o0o
   6
   7
   8
   9
  10
  11
  12
  13
  14
  15
  16
  17
  18
  19
  20
  21
  22
  23
  24
  25
                                                                1157
   1
   2                        INDEX OF EXAMINATION
   3   Witness                    D      X      RD     RX
   4   CHRIS DI BONA............987   1026    1033
   5   MICHAEL EINHORN.........1034   1048    1057
   6   DAVID TOURETZKY.........1061   1110
   7                         PLAINTIFF EXHIBITS
   8   Exhibit No.                                     Received
   9    1, 4, 28, 51-55, 64, 69, 72, 79, 126 and 129 1118
  10    2.1 through 2.34 and 3.1 through 3.34 ......1119
  11    77 and 93 ..................................1123
  12    98 .........................................1128
  13                         DEFENDANT EXHIBITS
  14   Exhibit No.                                     Received
  15    BDT ........................................1026
  16    CCN, CCO, CCP, and CCQ  ....................1080
  17    BBE ........................................1092
  18    CS .........................................1131
  19    FH .........................................1131
  20
  21
  22
  23
  24
  25
