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26 ORDER – 1

UNITED STATES DISTRICT COURT

WESTERN DISTRICT OF WASHINGTON

AT SEATTLE

VERITAS OPERATING CORPORATION, a

Delaware corporation,

Plaintiff,

v.

MICROSOFT CORPORATION, a Washington

corporation,

Defendant.

________________________________________

MICROSOFT CORPORATION, a Washington

corporation,

Counterclaim Plaintiff,

v.

VERITAS OPERATING CORPORATION, a

Delaware corporation, and VERITAS

SOFTWARE CORPORATION, a Delaware

corporation,

 Counterclaim Defendants.

 CASE NO. C06-0703-JCC

 ORDER

 

 

 

Case 2:06-cv-00703-JCC Document 429 Filed 03/11/08 Page 1 of 6
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26 ORDER – 2

This matter comes before the Court on Plaintiff Veritas Operating Corporation (Veritas)’s Motion

to Exclude Expert Testimony of Dr. Marco Iansiti (Dkt. No. 255), Defendant Microsoft Corporation

(Microsoft)’s Response in opposition (Dkt. No. 337), and Veritas’ Reply (Dkt. No. 348). The Court has

carefully considered these papers together with their supporting declarations and exhibits, and has

determined that oral argument is unnecessary. The Court hereby GRANTS IN PART and DENIES IN

PART the motion and rules as follows.

I. BACKGROUND

Dr. Marco Iansiti is the Director of Research and a Professor of Business Administration in the

Technology and Operations Management Department at the Harvard Business School. (Iansiti Report 2

(Dkt. No. 257 at 3).) Microsoft hired Dr. Iansiti to calculate Microsoft’s alleged damages related to its

breach of contract counterclaims in this lawsuit. (Id.) Ultimately, Dr. Iansiti submitted three expert

reports: one on Microsoft’s counterclaim damages, and two rebutting opinions of Veritas’ experts,

Jeffrey Chase (Veritas’ technology expert) and Michael Wagner (Veritas’ damages expert). (Def.’s Resp.

1 (Dkt. No. 337 at 2).) Dr. Iansiti describes his qualifications as follows:

I joined the faculty of Harvard Business School in 1989 to research the management of

technological innovation, product development, and operations. During my career at

Harvard Business School, I have performed academic research on the structure, processes,

operations, product development and technology aspects of a large number of commercial

enterprises focusing on software and technology-intensive businesses. I have worked with

and advised a variety of Global 1000 firms in industries ranging from pharmaceuticals to

electronics. I research and have also worked with and advised a number of software startup companies. During a one-year leave of absence from Harvard, I worked as the Vice

President of Products and Strategy at Model N., Inc., which focuses on enterprise

software applications for pricing and contract management. I have also prepared and

presented expert opinions in numerous cases. Over the last fifteen years at Harvard, I

fulfilled a variety of teaching and administrative assignments related to the development

and management of technology. I helped create and co-chaired Harvard’s Ph.D. program

in Information Technology and Management. I taught a variety of courses in the

management of technology, product development, and operations. I authored and coauthored a number of articles, papers, books, cases, and research notes that focus on

technology and operations strategy and on the management of operations and product

development. 

(Iansiti Report 2–3 (Dkt. No. 257 at 3–4).) 

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26 ORDER – 3

Veritas seeks to exclude from trial three portions of Dr. Iansiti’s testimony. Specifically, Veritas

challenges his opinions as to “(a) alleged expenses and losses incurred by Microsoft as a result of Veritas’

alleged breach of contract, (b) Microsoft’s development of LVM using the C++ programming language,

and (c) the quality of the Veritas LDM code that was provided to Microsoft.” (Pl.’s Mot. 1 (Dkt. No.

255 at 4).) 

II. APPLICABLE STANDARD

An expert witness may testify at trial if such expert’s “specialized knowledge will assist the trier of

fact to understand the evidence or to determine a fact in issue[.]” FED. R. EVID. 702. Such witness must

be “qualified as an expert by knowledge, skill, experience, training, or education” and may testify “if (1)

the testimony is based upon sufficient facts or data, (2) the testimony is the product of reliable principles

and methods, and (3) the witness has applied the principles and methods reliably to the facts of the case.”

Id. Expert testimony is liberally admitted under the Federal Rules. Daubert v. Merrell Dow Pharms., Inc.,

509 U.S. 579, 588 (1993) (noting that Rule 702 is part of the “liberal thrust of the Federal Rules and their

general approach of relaxing the traditional barriers to opinion testimony”) (internal quotations omitted).

However, the “trial judge must ensure that any and all scientific testimony [or any other expert testimony]

or evidence admitted is not only relevant, but reliable.” Id. at 589; see also Kumho Tire Co., Ltd. v.

Carmichael, 526 U.S. 137, 147 (1999) (extending Daubert’s requirements of relevance and reliability to

non-scientific testimony). That said, “a trial court not only has broad latitude in determining whether an

expert’s testimony is reliable, but also in deciding how to determine the testimony’s reliability.”

Hangarter v. Provident Life & Accident Ins. Co., 373 F.3d 998, 1017 (9th Cir. 2004) (internal citations

omitted) (emphasis in original). “Concerning the reliability of non-scientific testimony . . . , the Daubert

factors (peer review, publication, potential error rate, etc.) simply are not applicable to this kind of

testimony, whose reliability depends heavily on the knowledge and experience of the expert, rather than

the methodology or theory behind it.” Id. (internal citation omitted) (emphasis in original). The trial

court’s gatekeeping role under Daubert is satisfied, even without a formal hearing, by the court’s probing

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26 ORDER – 4

of the expert’s knowledge and experience. Id. at 1018.

III. ANALYSIS

A. Dr. Iansiti’s Testimony Related to Microsoft’s Breach of Contract Counterclaim

Veritas challenges Dr. Iansiti’s opinion as to Microsoft’s damages stemming from Veritas’ alleged

breach of the parties’ Agreement, on grounds that his methodology for calculating Microsoft’s

development expenses are speculative and unreliable. (Pl.’s Mot. 7 (Dkt. No. 255 at 10).) Due to the fact

that the Court has recently dismissed Microsoft’s breach-of-contract-related counterclaims, however, the

parties’ arguments are no longer relevant to the posture of the case. Veritas’ motion is therefore

DENIED as moot on this issue.

B. Dr. Iansiti’s Rebuttal Testimony Related to Microsoft’s Development of LVM Using

the C++ Programming Language and the Quality of the Veritas LDM Code

Provided to Microsoft

Veritas argues that Dr. Iansiti should not be permitted to rebut the opinions of Dr. Chase, Veritas’

technical and source code expert, on issues that require source code analysis. Veritas asserts that Dr.

Iansiti was not hired as—and is not qualified to testify as—a computer science expert and did not

examine the relevant source code in this case. Specifically, Veritas seeks to bar Dr. Iansiti from testifying

that it was “reasonable for Microsoft to move technologies like the Embedded Product from the original

C language to the C++ language” and that Veritas’ LDM code as delivered to Microsoft was “severely

buggy.” (Pl.’s Mot. 5 (Dkt. No. 255 at 8).) Veritas argues alternatively that even if the Court finds that

Dr. Iansiti’s testimony as to these matters is not excluded under Rule 702 and Daubert, the Court should

nevertheless exclude the testimony under Rule 403 because its “probative value is substantially

outweighed by the danger of unfair prejudice.” FED. R. EVID. 403. (Id. at 11.)

Microsoft counters, however, that the opinions Veritas challenges are more accurately summed

up as (1) “Microsoft’s use of the C++ programming language is consistent with industry and Microsoft

standards” and (2) “the severe bugginess of the Veritas code necessitated Microsoft’s work reintegrating

that code.” (Def.’s Resp. 9 (Dkt. No. 337 at 10).) Microsoft posits that contrary to Veritas’ arguments,

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26 ORDER – 5

these opinions are not dependent on source code analysis, and are “well within Dr. Iansiti’s software

development expertise, experience and knowledge.” (Id. at 10.) 

The Court notes that, notwithstanding the three short statements in Dr. Iansiti’s deposition cited

by Veritas, in which he admits that he is not a computer science expert in this case, is not an expert with

regard to code analysis, and is not an expert in software architecture, (Iansiti Dep. 66:11–12; 168:14–15,

20–21 (Dkt. No. 257-3 at 12, 21)), Dr. Iansiti has a significant amount of experience in, and knowledge

of, the computer software industry. For example, as he stated in his deposition: 

I spent an awful lot of my life in the computer industry to begin with. I have worked and

led teams that did essentially product management and product engineering in—for a

software company. I created a program in conjunction with my friend H.T. Kung in

information technology management that is a cross-program within computer science and

the . . . Harvard business school. And I’ve taught classes in the computer science

department. . . . [A] lot of my physics Ph.D. was in computer programming and

simulation. . . . I have led product management and product strategy for a company called

Model N. So I had a lot of people working for me writing features and specifications for a

product that worked on UNIX.

(Iansiti Dep. 168:3–170:14 (Dkt. No. 257-3 at 21–23).) 

The Court finds that Dr. Iansiti’s knowledge and experience in the software industry qualify him

to testify as to Microsoft’s adoption of industry programming standards that were trending towards the

use of C++ programming language. Veritas, in its Reply, appears to concede that his testimony, limited to

those parameters, should be permitted. (Pl.’s Reply 5 (Dkt. No. 348 at 6).) However, not being

Microsoft’s source code expert, and not having examined the code at issue in this case, he will not be

permitted to rebut Dr. Chase’s opinions as to source code analysis. To that end, he will not be permitted

to testify as to whether Veritas’ LDM code as delivered to Microsoft was “severely buggy.” Microsoft

argues that Dr. Iansiti does not make this conclusion as an expert opinion, but rather cites evidence in the

record that such was the case, and “from this evidence opined that ‘Microsoft’s bug fixes, including the

reintegration effort, were needed to optimize the product, improve its quality, and better integrate it with

the Windows environment.’” (Def.’s Resp. 12 (Dkt. No. 337 at 13) (emphasis in original).) However, Dr.

Iansiti’s opinion, as stated in the preceding sentence, depends on an evaluation of source code and as

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26 ORDER – 6

such, the Court finds it is not a proper area of testimony for Dr. Iansiti.

Accordingly, Veritas’ motion to exclude the testimony of Dr. Iansiti as to Microsoft’s

development of LVM using the C++ programming language is DENIED to the extent that such opinion

does not depend upon source code analysis, and the motion is GRANTED with respect to Dr. Iansiti’s

testimony respecting the quality of the Veritas LDM code as provided to Microsoft. The Court reminds

the parties that notwithstanding this Order, the Court will rule on pertinent objections to Dr. Iansiti’s

testimony as they arise at trial.

IV. CONCLUSION

For the foregoing reasons, the Court hereby GRANTS IN PART and DENIES IN PART Veritas’

Motion to Exclude Expert Testimony of Dr. Marco Iansiti (Dkt. No. 255), as follows: 

(1) Veritas’ motion to exclude Dr. Iansiti’s testimony related to Microsoft’s

counterclaim is hereby DENIED as moot; 

(2) Veritas’ motion to exclude the testimony of Dr. Iansiti as to Microsoft’s

development of LVM using the C++ programming language is DENIED to

the extent that such opinion does not depend upon source code analysis;

and

(3) the motion is GRANTED with respect to Dr. Iansiti’s testimony respecting

the quality of the Veritas LDM code as provided to Microsoft.

DATED this 11th day of March, 2008.

_

John C. Coughenour

UNITED STATES DISTRICT JUDGE

A

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