1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

UNITED STATES COURT REPORTERS

160

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

FEDERAL TRADE COMMISSION, 

PLAINTIFF,

VS.

QUALCOMM INCORPORATED, A 

DELAWARE CORPORATION,

DEFENDANT.

)

)

)

)

)

)

)

)

)

)

)

C-17-00220 LHK

SAN JOSE, CALIFORNIA

JANUARY 7, 2019

VOLUME 2 

PAGES 160-407

SEALED PAGES 368 - 407

TRANSCRIPT OF PROCEEDINGS

BEFORE THE HONORABLE LUCY H. KOH 

UNITED STATES DISTRICT JUDGE

A P P E A R A N C E S:

FOR THE PLAINTIFF: FEDERAL TRADE COMMISSION 

BY: JENNIFER MILICI

 DANIEL J. MATHESON 

 WESLEY G. CARSON

 KENT COX

 NATHANIEL M. HOPKIN

 PHILIP J. KEHL 

600 PENNSYLVANIA AVENUE, NW 

WASHINGTON, D.C. 20580

APPEARANCES CONTINUED ON NEXT PAGE

OFFICIAL COURT REPORTERS: LEE-ANNE SHORTRIDGE, CSR, CRR

CERTIFICATE NUMBER 9595

IRENE RODRIGUEZ, CSR, CRR, RMR

CERTIFICATE NUMBER 8074

PROCEEDINGS RECORDED BY MECHANICAL STENOGRAPHY

TRANSCRIPT PRODUCED WITH COMPUTER

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 1 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

UNITED STATES COURT REPORTERS

161

APPEARANCES (CONTINUED)

FOR THE DEFENDANT: KEKER, VAN NEST & PETERS 

BY: ROBERT A. VAN NEST

 JUSTINA K. SESSIONS

 EUGENE M. PAIGE

 CHRISTINA BLAIS

 MATAN SHACHAM

 CODY HARRIS

 KRISTIN HUCEK 

633 BATTERY STREET

SAN FRANCISCO, CALIFORNIA 94111 

CRAVATH, SWAINE & MOORE 

 BY: GARY A. BORNSTEIN

 MICHAEL BRENT BYARS

 YONATAN EVEN

 JORDAN D. PETERSON

 MING-TOY TAYLOR

 DEREK SUTTON

 ANDREW HUYNH 

825 EIGHTH AVENUE 

 NEW YORK, NEW YORK 10019

ALSO PRESENT: MARK SNYDER 

JEFF DAHM

KEN KOTARSKI 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 2 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

UNITED STATES COURT REPORTERS

162

INDEX OF WITNESSES

PLAINTIFF'S

NANFEN YU

VIDEOTAPED DEPOSITION P. 175

STEVEN ALTMAN

DIRECT EXAM BY MR. MATHESON P. 177

CROSS-EXAM BY MR. BORNSTEIN P. 210

REDIRECT EXAM BY MR. MATHESON P. 242 

DEREK ABERLE 

DIRECT EXAM BY MS. MILICI P. 248

CROSS-EXAM BY MR. BORNSTEIN P. 283

REDIRECT EXAM BY MS. MILICI P. 309

JOHN MOYNIHAN

DIRECT EXAM BY MR. KEHL P. 321

CROSS-EXAM BY MR. SHACHAM P. 343

REDIRECT EXAM BY MR. KEHL P. 364

RECROSS-EXAM BY MR. SHACHAM P. 381

FURTHER REDIRECT EXAM BY MR. KEHL P. 387 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 3 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

UNITED STATES COURT REPORTERS

163

INDEX OF EXHIBITS

MARKED ADMITTED

PLAINTIFF'S

8206 182

6983 184

6729 186

8281 189

7141 193

6987 194

6979 195

7799 196

8177 197

7580 198

6663 199

6992 199

7886 207

6469 249

7650 251

6974 257

6998 258

5231 263

6658 273

7105 276

7556 279

3542 372

3551 375

3264, 3283 & 3255 391

DEFENDANT'S

9278 225

9262 226

9210 292

9212 294

9214 301

219 357

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 4 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

UNITED STATES COURT REPORTERS

164

INDEX OF EXHIBITS

MARKED ADMITTED

JOINT

0003 180

0030 191

0001 215

0003 219

0004 220

0005 223

0006 228

0063 254

0072 256

0093 266

0050 332

0051 338

0094 & 0062 391

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 5 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

UNITED STATES COURT REPORTERS

165

SAN JOSE, CALIFORNIA JANUARY 7, 2019 

P R O C E E D I N G S

(COURT CONVENED AT 9:04 A.M.)

THE COURT: GOOD MORNING, WELCOME. 

MR. VAN NEST: GOOD MORNING, YOUR HONOR. 

THE CLERK: PLEASE BE SEATED. 

THE COURT: ALL RIGHT. LET'S RESUME THE PLAYING OF 

THE DEPOSITION OF MS. YU, PLEASE. 

MR. VAN NEST: YOUR HONOR? 

THE COURT: YES. 

MR. VAN NEST: COULD I ADDRESS THE COURT BRIEFLY ON 

THE SEALING MOTION? IT'S NOT RELEVANT TO MS. YU, BUT IT WOULD 

BE RELEVANT TO -- 

THE COURT: IT'S COUNTING TOWARDS YOUR TIME. IT'S 

9:04. 

GO AHEAD, PLEASE. 

MR. VAN NEST: I JUST WANTED TO EXPLAIN THE FILING 

LAST EVENING AND SUGGEST TO THE COURT A SIMPLER WAY TO DO THIS. 

WHAT HAPPENED IS ON THURSDAY NIGHT -- WE FILED WITH THE 

COURT A JOINT STATEMENT THAT INDICATED WHAT THE SEALING 

PARAMETERS WERE. IF IT'S OLDER THAN THREE YEARS, IT'S 

PRESUMPTIVELY NOT SEALABLE UNLESS IT'S A SPECIFIC LICENSING 

TERM FOR SOMETHING VERY CONFIDENTIAL. SO THAT'S BEEN THE 

PARTIES' PARAMETERS. 

AND THEN YOU AND I HAD A DISCUSSION FRIDAY WHERE WE GOT A 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 6 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

UNITED STATES COURT REPORTERS

166

LITTLE MORE GUIDANCE ABOUT WHAT YOU FELT WAS SEALABLE AND WHAT 

WASN'T. 

ON THURSDAY NIGHT, THE FTC DISCLOSED 103 EXHIBITS FOR 

TODAY AND WE ASKED THEM TO NARROW THAT, ASSUMING THAT THEY 

WOULDN'T ACTUALLY USE ALL 103. THEY DID THAT SATURDAY 

AFTERNOON, AND I SAID AT THAT TIME TO MY TEAM, I THINK WE 

SHOULD LET JUDGE JUDGE KOH KNOW WHAT THE BODY IS THAT MIGHT BE 

INTRODUCED, AND OUT OF AN ABUNDANCE OF CAUTION, FILE A SEALING 

MOTION ON THE EXHIBITS THAT WE CONSIDER CONFIDENTIAL, AND THERE 

WERE 35 OF THEM. 

UNFORTUNATELY, THERE'S A LARGE VOLUME. 

THE COURT: IT'S 943 PAGES THAT YOU FILED ON SUNDAY 

NIGHT -- 

MR. VAN NEST: THAT'S RIGHT. 

THE COURT: -- TO BE USED MONDAY AT TRIAL. 

MR. VAN NEST: WE DIDN'T KNOW UNTIL SATURDAY WHAT THE 

REAL BODY WAS. 

I DIDN'T WANT TO FILE EARLIER BECAUSE THERE WOULD THEN 

HAVE BEEN A LOT MORE VOLUME. 

WHAT I'M SUGGESTING, AND WHAT I'VE SUGGESTED TO THE FTC, 

CONSISTENT WITH THE GUIDANCE YOU GAVE US FRIDAY, WAS PROCEED 

WITH THE EXAM, THE EXAMS TODAY. THEY KNOW WHAT WE CONSIDER 

CONFIDENTIAL FROM THE JOINT FILING THAT WE MADE. 

THIS EVENING, AFTER WE KNOW HOW MANY OF THE 88 REMAINING 

EXHIBITS HAVE BEEN ADMITTED, WE'LL PARE DOWN THE MOTION, FILE 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 7 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

UNITED STATES COURT REPORTERS

167

IT BASED ONLY ON WHAT WAS ACTUALLY ADMITTED. I THINK YOU'LL 

FIND THAT WE USED THE FILTER THAT YOUR HONOR DISCUSSED WITH ME 

FRIDAY TO FILTER THESE OUT. WE'RE DOWN TO SPECIFIC LICENSING 

TERMS AND SALES DATA AS YOU AND I DISCUSSED FRIDAY. 

BUT I DO OBJECT, AS I HAVE IN THE PAST, TO THEIR SEEKING 

LICENSING TERMS INCONSISTENT WITH OUR JOINT FILING IN OPEN 

COURT. 

WE DON'T HAVE TO CLOSE THE COURTROOM. WE HAVE OUR -- WE 

HAVE OUR PUBLIC MONITOR WE CAN TURN OFF AND THE WITNESS AND THE 

COURT WILL HAVE ALL THE RELEVANT INFO. 

BUT I DIDN'T WANT TO SIMPLY LET THESE DOCUMENTS COME IN 

AND HAVE TO DO IT ON THE FLY IN THE COURTROOM. THAT'S WHY I 

FILED --AND I APOLOGIZE THAT IT WAS SO LENGTHY. 

WHAT I THINK MAKES A LOT MORE SENSE IS WE'LL LET THEM KNOW 

WHAT DOCUMENTS WE CONSIDER CONFIDENTIAL AHEAD OF TIME, I THINK 

THEY KNOW BASED ON WHAT WE'VE SAID. WE WILL WAIT TO FILE 

ANYTHING UNTIL WE KNOW WHAT WAS ACTUALLY IN EVIDENCE; NO 

EXHIBITS WILL BE FILED ON THE PUBLIC RECORD UNTIL YOU'VE HAVE A 

CHANCE TO LOOK AT THE MOTION, GRANT IT OR DENY IT; AND WE'LL 

FILE A REDACTED VERSION AS APPROPRIATE. 

I THINK THAT WILL MAKE THINGS GO A LOT MORE SMOOTHLY. 

THE COURT: I DON'T UNDERSTAND WHY THIRD PARTIES ARE 

ABLE TO FILE THEIR MOTIONS TIMELY. THEY'RE MAKING FILINGS ON 

SATURDAY, THEY'RE MAKING THEIR FILINGS ON FRIDAY, AND QUALCOMM, 

WITH -- HOW MANY LAW FIRMS DO YOU HAVE IN THIS CASE? FIVE? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 8 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

UNITED STATES COURT REPORTERS

168

YOU HAVE NORTON, ROSE, FULBRIGHT, RIGHT? YOU'VE GOT QUINN, 

EMANUEL; YOU'VE GOT MORGAN, LEWIS & BOCKIUS; YOU'VE GOT KEKER 

VAN NEST; YOU'VE GOT CRAVATH, SWAINE MOORE. HOW MANY FIRMS ARE 

REPRESENTING QUALCOMM? 

I DON'T UNDERSTAND WHY YOUR FILINGS ARE LATE, HALF AN HOUR 

LATE ON FRIDAY. YOU'RE FILING THE WRONG DEPOSITION. YOU'RE 

GIVING ME THE TRANSCRIPTS FOR GEORGE DAVIS WHEN THE WITNESS IS 

MARK DAVIS. 

I DON'T UNDERSTAND WHAT'S GOING ON, WHY THE THIRD PARTIES 

CAN GET THEIR FILINGS ON TIME, EVEN THOUGH THEY'RE TRYING TO DO 

THE BEST WE CAN ON SHORT NOTICE, AND QUALCOMM IS ASKING US TO 

REVIEW A THOUSAND PAGES ON SUNDAY MIGHT BEFORE MONDAY TRIAL. 

MR. VAN NEST: WHAT I -- 

THE COURT: HOW MANY LAWYERS DO YOU HAVE WORKING ON 

THIS TRIAL? HOW MANY? I WANT THE FULL NUMBER, NOT JUST WHO'S 

HERE IN COURT. ARE YOU GUYS AT THE FAIRMONT OR ARE YOU AT THE 

MARRIOTT? HOW MANY LAWYERS DO YOU HAVE CHURNING ON THIS CASE? 

I DON'T UNDERSTAND WHY THIRD PARTIES CAN DO IT AND 

QUALCOMM CANNOT. 

MR. VAN NEST: IT'S A QUESTION OF VOLUME. THE THIRD 

PARTIES -- 

THE COURT: WHAT I DIDN'T APPRECIATE IS YOU FILED 

THIS ON SUNDAY NIGHT SAYING WE DON'T KNOW REALLY WHICH ONE 

WE'RE GOING TO USE. JUST GO AHEAD AND GIVE US A RULING ON 

ABOUT A THOUSAND PAGES AND THEN WE'LL FIGURE OUT TOMORROW WHICH 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 9 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

UNITED STATES COURT REPORTERS

169

ONES WE THINK WILL BE INTRODUCED. 

MR. VAN NEST: NOT US. EXCUSE ME, YOUR HONOR. 

WE DON'T KNOW WHICH ONES THEY'RE GOING TO INTRODUCE. 

THEY'RE THE ONES THAT FILED, AND WE DIDN'T KNOW UNTIL LATE 

SATURDAY. 

THE COURT: YOU SAID YOU KNEW SATURDAY AFTERNOON. 

WHAT TIME DID YOU LET THEM KNOW? 

MS. MILICI: YOUR HONOR, WE HAD MOVED UP THE H.P.O. 

BRIEFING PROCESS, SO WE GAVE A THEM BROADER LIST ON THURSDAY 

NIGHT THAT HAD ABOUT 100 DOCUMENTS. 

AND I WOULD SAY THESE ARE QUALCOMM'S OWN DOCUMENTS. THEY 

HAVE HAD OUR EXHIBIT LIST OF 400 DOCUMENTS NOW FOR QUITE A 

WHILE. WE'VE BEEN ASKING THEM SINCE MID-DECEMBER TO PLEASE 

TELL US WHICH DOCUMENTS THEY WERE GOING TO SEEK TO SEAL FROM 

THAT UNIVERSE OF 400, THINKING THAT AT LEAST THE SEVERAL WEEKS 

BEFORE TRIAL WOULD BE ENOUGH TIME TO DO THAT. 

AND THEN WE IDENTIFIED THE 100, AND THEN AS A MATTER OF 

COURTESY, WE ARE NARROWED THE LIST FURTHER ON SATURDAY. 

BUT THEY HAVE KNOWN THAT THERE IS A UNIVERSE OF 400 SINCE 

MID-DECEMBER, AND THEN A UNIVERSE OF 100 FOR TODAY SINCE 

THURSDAY, AND THEN IT WAS DROPPED TO LOWER THAN THAT ON 

SATURDAY AFTERNOON. 

MR. VAN NEST: BUT I THINK WE DISCUSSED THIS AT THE 

PRETRIAL, YOUR HONOR, AND WE ALL AGREED IT DIDN'T MAKE SENSE TO 

HAVE PEOPLE FILE ON EXHIBITS THAT WERE NEVER GOING TO SEE THE 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 10 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

UNITED STATES COURT REPORTERS

170

LIGHT OF DAY ANYWAY. 

THE BIG DIFFERENCE BETWEEN US AND THE THIRD PARTIES IS THE 

THIRD PARTIES ARE GETTING NOTICE OF A VERY LIMITED NUMBER OF 

DOCUMENTS, AND THE NUMBER OF DOCUMENTS FOR QUALCOMM IS MUCH 

BIGGER. 

I APOLOGIZE FOR THE VOLUME, BUT I HONESTLY THINK -- 

THE COURT: I AM THE ONE WHO'S BEEN WANTING TO LIMIT 

THE NUMBER OF EXHIBITS FROM THE BEGINNING BECAUSE I KNEW THIS 

WOULD HAPPEN, THERE WERE GOING TO BE A LOT OF FIGHTS ON THINGS 

THAT YOU ULTIMATELY WEREN'T GOING TO USE, AND YOU FOUGHT ME 

TOOTH AND NAIL ABOUT ALL OF THESE LIMITS, TOOTH AND NAIL, AND 

WE'VE HAD FLEA MARKET NEGOTIATIONS OF THE NUMBERS UP AND DOWN, 

20 EXHIBITS, 30 EXHIBITS, 50 EXHIBITS. 

I KNEW THIS WAS GOING TO HAPPEN. THAT'S WHY I ALWAYS LIKE 

A MORE NARROWED CASE BECAUSE YOU HAVE A LOT OF FIGHTS ON WHAT I 

KNOW ULTIMATELY WILL NEVER COME INTO THIS TRIAL. 

SO I WOULD LOVE IT IF YOU WANT TO LIMIT THE NUMBER OF 

EXHIBITS FURTHER. I WOULD SAY LET'S DO IT TODAY. THEN I DON'T 

HAVE TO GET FILINGS ON SUNDAY NIGHT ASKING ME TO REVIEW 

1,000 -- I JUST FILED THE BROADCOM ORDER. 

I'M JUST REVIEWING THE SAMSUNG ORDER, AND THEN QUALCOMM 

FILES ITS SAMSUNG OBJECTIONS, OR REQUESTS FOR SEALING, SUNDAY 

NIGHT AS WELL. SO I'M ALMOST THROUGH ALL OF THAT. I'M ON THE 

LAST DOCUMENT, EXHIBIT 122. I'M HOPING TO GET THAT DONE DURING 

THE BREAK OR DURING LUNCH. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 11 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

UNITED STATES COURT REPORTERS

171

MR. VAN NEST: WONDERFUL. 

THE COURT: BUT, LIKE, IT'S NOT REASONABLE WHAT 

YOU'RE EXPECTING US TO DO. 

AND SAMSUNG WAS ABLE TO FILE FRIDAY AND SATURDAY. 

BROADCOM FILED SOMETHING RESPONDING TO AN ORDER FILED AT 5:00 

O'CLOCK YESTERDAY. THEY RESPONDED, LIKE, WITHIN AN HOUR. 

OKAY? 

SO THIRD PARTIES ARE HUSTLING TO GET US THINGS TIMELY, AND 

QUALCOMM IS WAITING -- LIKE, WHY COULDN'T YOU -- YOU KNOW, 

SAMSUNG FILED ON FRIDAY SAYING HERE IS OUR LICENSE WITH 

QUALCOMM, THIS IS WHAT WE WANT SEALED, THIS IS WHAT WE THINK 

QUALCOMM MAY WANT TO SEAL. 

QUALCOMM DOESN'T EVEN FILE ITS REQUEST TO SEAL ITS LICENSE 

WITH SAMSUNG UNTIL SUNDAY AT LIKE 5:00 OR 6:00 O'CLOCK. WHY IS 

THAT HAPPENING? SAMSUNG FILED ON FRIDAY AND THEY DID YOU THE 

COURTESY OF SAYING THIS IS NOT WHAT WE WANT TO REDACT, BUT WE 

THINK QUALCOMM MIGHT WANT TO REDACT THIS, AND THEY WENT AHEAD 

AND REDACTED. 

WHY DON'T I GET QUALCOMM'S ORDER BEFORE SUNDAY AT 5:00 

O'CLOCK. WHY? 

MR. VAN NEST: THE REASON FOR THE SAMSUNG SITUATION, 

YOUR HONOR, IS THEY DIDN'T UNDERSTAND WHAT WAS ACTUALLY IN THE 

EXHIBIT. ALL THEY DID WAS IDENTIFY THE SULA ITSELF. IF TURNS 

OUT THERE WERE HUNDREDS OF PAGES OF DOCUMENTS, EXHIBITS, 

ATTACHED TO THAT THAT THEY DIDN'T REALIZE WERE GOING TO BE MADE 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 12 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

UNITED STATES COURT REPORTERS

172

PUBLIC AS PART OF THE EXHIBIT. 

SO AS SOON AS WE REALIZED THAT -- 

THE COURT: NO, WAIT A MINUTE. YOU ALL DIDN'T EVEN 

GIVE ME QUALCOMM'S VIEW ON THE SULA TERMS UNTIL 5:00 O'CLOCK ON 

SUNDAY. WHY IS THAT? SAMSUNG FILED ON FRIDAY MORNING, OKAY? 

THIS IS YOUR SULA. I ASSUME IT'S FAIRLY STANDARD IN MANY 

RESPECTS. 

THE EXHIBITS ARE, LIKE, HERE ARE THE PATENT POOLS OF 

WHAT'S IN ALL THESE STANDARDS FOR PATENTS THAT HAVE ALREADY 

BEEN ISSUED. THAT'S EXHIBITS 1 AND 2. THEN EXHIBITS 3 AND 4, 

THESE ARE THE POOLS OF PATENTS THAT ARE PENDING. 

I MEAN, THIS IS PRETTY STANDARD, I WOULD THINK, FOR 

QUALCOMM WHOM, FOR WHOM LICENSING IS THE BREAD AND BUTTER OF 

ITS BUSINESS. 

SO WHY DID I NOT GET QUALCOMM'S SEALING REQUEST UNTIL 

SUNDAY AT 5:00 O'CLOCK FOR SOMETHING SAMSUNG FILED ON FRIDAY 

MORNING? 

MR. VAN NEST: I BELIEVE THAT IT WASN'T UNTIL LATER 

IN THE PROCESS ON SATURDAY THAT WE REALIZED THAT THEY HADN'T 

SOUGHT TO SEAL ANYTHING OTHER THAN THE SULA, AND THERE WERE 

MANY OTHER ATTACHMENTS. 

THAT'S WHY WE SAID TO THEM, WE'LL GO AHEAD AND FILE 

SOMETHING AS SOON AS WE CAN ON EVERYTHING ELSE AND HOPEFULLY 

YOU CAN JUST JOIN, YOU WON'T HAVE TO DO ANYTHING. 

SO WE DID THAT TO COVER THE OTHER DOCUMENTS THAT THEY WERE 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 13 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

UNITED STATES COURT REPORTERS

173

NOT AWARE WERE PART OF THE EXHIBIT. THAT'S WHAT HAPPENED WITH 

SAMSUNG. 

THAT'S A SNAFU THAT I DIDN'T REALIZE WAS HAPPENING UNTIL 

LATE IN THE DAY SATURDAY WHEN WE, WHEN WE UNDERSTOOD FROM 

SAMSUNG. 

THEN THEY SAID, WELL, WAIT A MINUTE, WE'VE GOT TO TALK TO 

KOREA. THERE WAS SOME BACK AND FORTH FRIDAY NIGHT ABOUT TIME 

AND SO ON AND SO FORTH. YOU GAVE MORE TIME, UNTIL SATURDAY AT 

NOON. 

WHEN THEY FILED SATURDAY, THEY DIDN'T COVER ALL THE 

DOCUMENTS IN THE EXHIBIT, AND THAT'S WHEN WE REALIZED WE NEEDED 

TO FILE SOMETHING BECAUSE IT WAS TOO LATE IN KOREA. 

THE COURT: NO, THAT'S NOT TRUE. 

WHAT THEY FILED ON FRIDAY SAID, HERE IS EVERYTHING THAT WE 

WANT SEALED. WE'RE GOING AHEAD AND REDACTING EVERYTHING ELSE 

THAT WE THINK QUALCOMM MIGHT WANT TO SEAL, BUT THEY NEED TO 

FILE SOMETHING. 

SO WHEN WE WERE RULING ON THIS ON SUNDAY AFTERNOON, THERE 

WAS NO DECLARATION FROM QUALCOMM. THERE WAS NO MOTION TO SEAL 

FROM QUALCOMM. 

SO THAT'S WHY THE ORDER ON SUNDAY AFTERNOON JUST ADDRESSED 

WHAT SAMSUNG WANTED TO SEAL BECAUSE WE DIDN'T HAVE ANY WORD 

FROM QUALCOMM AT ALL AS TO ALL OF THE PORTIONS THAT SAMSUNG 

DESIGNATED AS POTENTIALLY SEALABLE BY QUALCOMM. 

ANYWAY -- 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 14 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

UNITED STATES COURT REPORTERS

174

MR. VAN NEST: I APOLOGIZE FOR THAT. 

THE COURT: I AM GOING TO SUBTRACT TIME FROM 

QUALCOMM'S TRIAL EVIDENCE, AND I'M GOING TO REVIEW PAGE-BY-PAGE 

AND LINE-BY-LINE ANY DOCUMENT THAT HAS NOT YET BEEN SEALED THAT 

YOU WANT TO SEAL, AND WE'RE JUST GOING TO DO IT THIS WAY. 

OKAY? 

MR. VAN NEST: THANK YOU, YOUR HONOR. WE'LL FILE A, 

A NARROWED FILING THIS EVENING FOLLOWING WHAT GETS ADMITTED IN 

COURT TODAY. 

I WILL ALSO LET THE COURT KNOW -- 

THE COURT: NO, NO, NO. WE'RE GOING TO DO THE 

SEALING IN COURT BECAUSE I NEED TO KNOW WHETHER I NEED TO 

EXCUSE EVERYBODY AND ASK THEM TO STEP OUTSIDE.

MR. VAN NEST: OKAY.

THE COURT: WE'RE GOING TO DO IT IN COURT AND WE'RE 

GOING TO DO IT ON TRIAL TIME. THAT'S THE WAY IT'S GOING TO BE 

DONE. 

MR. VAN NEST: WE'LL BE FILING ALSO TODAY THE 

STATEMENT YOU ASKED FOR ON FRIDAY ON WHAT LICENSING PROGRAMS 

ARE PUBLIC AND WHAT ARE NOT. SO WE'LL TRY TO GET THAT IN 

SOMETIME DURING THE TRIAL DAY. 

THE COURT: ALL RIGHT. YOU'RE NOT GOING TO HAVE US 

BE DOING SEALING TONIGHT. WE'RE GOING TO BE DOING SEALING 

WHILE YOUR WITNESS IS ON THE WITNESS STAND AND I'LL BE 

REVIEWING THE DOCUMENTS AND YOU CAN LET ME KNOW WHAT YOU WANT 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 15 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

UNITED STATES COURT REPORTERS

175

SEALED AND I'LL MAKE A RULING BECAUSE I NEED TO KNOW WHETHER I 

NEED TO EXCUSE EVERYBODY AND ASK THEM TO STEP OUTSIDE. 

MR. VAN NEST: THANK YOU, YOUR HONOR. 

THE COURT: ALL RIGHT. TIME IS 9:15. 

MR. COX: GOOD MORNING, YOUR HONOR. KENT COX AGAIN 

FOR THE FTC. 

WHEN WE ENDED ON FRIDAY, MS. YU WAS TESTIFYING ABOUT 

CX 1006. 

MR. KOTARSKI, WOULD YOU PLEASE PLAY THE VIDEO? 

THE COURT: TIME IS 9:15. 

(THE VIDEOTAPED DEPOSITION OF NANFEN YU WAS PLAYED IN OPEN 

COURT OFF THE RECORD.)

THE COURT: WHAT'S THE TIME, PLEASE, MS. SHORTRIDGE? 

THE REPORTER: 9:42. 

THE COURT: 9:42? OKAY. THANK YOU. 

OKAY. WHO'S YOUR NEXT WITNESS? 

MR. MATHESON: YOUR HONOR, THE FTC CALLS 

STEVEN ALTMAN. 

DAN MATHESON FOR THE FTC, YOUR HONOR. 

THE COURT: I DIDN'T SEE THIS MORNING THAT YOU ALL 

FILED THE JOINT EXHIBIT LIST OR THE LIST OF ATTORNEYS. IT 

WASN'T FILED BEFORE I CAME OUT ON THE BENCH. 

MS. GILLEN: YOUR HONOR, ELIZABETH GILLEN FOR THE 

FTC. 

WE FILED THOSE MATERIALS LAST NIGHT. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 16 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

UNITED STATES COURT REPORTERS

176

THE COURT: HMM. 

MS. GILLEN: I CAN REFER YOU TO THE DOCKET ENTRIES IN 

A MINUTE. 

THE COURT: LET ME ASK, MAYBE MS. GARCIA CAN PULL 

THEM UP FOR ME. 

THANK YOU. 

NOW, IS MS. YU, IS SHE SUBJECT TO RECALL OR NOT? 

MR. MATHESON: NOT FROM THE FTC, YOUR HONOR. 

MR. VAN NEST: MS. YU? 

THE COURT: YES. 

MR. VAN NEST: NO, YOUR HONOR. 

THE COURT: OKAY. SO SHE'S THEN EXCUSED. OKAY. 

THANK YOU. 

OKAY. PLEASE COME FORWARD. 

THE CLERK: PLEASE TAKE A SEAT. 

PLEASE RAISE YOUR RIGHT HAND. 

(PLAINTIFF'S WITNESS, STEVEN ALTMAN, WAS SWORN.)

THE WITNESS: YES. 

THE CLERK: THANK YOU. PLEASE BE SEATED. 

PLEASE STATE YOUR FULL NAME AND SPELL YOUR LAST NAME FOR 

THE RECORD. 

THE WITNESS: STEVEN RUSSELL ALTMAN. A-L-T-M-A-N. 

MR. MATHESON: MAY I APPROACH THE WITNESS AND HAND 

HIM A BINDER, YOUR HONOR. 

THE COURT: YES. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 17 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

177

AND IS STEVEN SPELLED WITH A V OR WITH A P-H? 

THE WITNESS: WITH A V, YOUR HONOR. 

THE COURT: OKAY. THANK YOU. 

MR. MATHESON: HERE ARE SOME TRANSCRIPTS AND 

DOCUMENTS. 

DEPOSITION TRANSCRIPTS FOR THE COURT (HANDING). 

THANK YOU VERY MUCH. 

(PAUSE IN PROCEEDINGS.) 

MR. MATHESON: YOUR HONOR, MAY I PROCEED? 

THE COURT: YES. IS THERE A BINDER OF EXHIBITS? I 

ONLY HAVE THE TWO DEPOSITION TRANSCRIPTS. 

MR. MATHESON: MAY I APPROACH, YOUR HONOR? 

THE COURT: YES, PLEASE. 

MR. MATHESON: (HANDING.) 

THE COURT: THANK YOU. 

OKAY. TIME IS 9:45. GO AHEAD, PLEASE. 

DIRECT EXAMINATION

BY MR. MATHESON: 

Q. GOOD MORNING, SIR. 

A. GOOD MORNING. 

Q. IT'S FAIR TO SAY THAT YOU HAVE BEEN DESCRIBED AS THE 

ARCHITECT OF QUALCOMM'S LICENSING PROGRAM. 

IS THAT A FAIR STATEMENT? 

A. YEAH, PEOPLE HAVE SAID THAT. BUT IT WAS A WHOLE TEAM OF 

PEOPLE THAT I WORKED WITH. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 18 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

178

Q. TO THE BEST OF YOUR KNOWLEDGE, IT'S FAIR TO DESCRIBE 

QUALCOMM'S BUSINESS MODEL AS UNIQUE AMONGST MODEM CHIP 

SUPPLIERS; IS THAT FAIR? 

A. I THINK IT'S REASONABLY UNIQUE, YES.

Q. YOU'RE NOT AWARE OF ANY OTHER CHIP SUPPLIERS THAT HAVE A 

LICENSING PROGRAM LIKE QUALCOMM'S; IS THAT FAIR? 

A. OVER -- YOU MEAN PRESENTLY, OR OVER THE COURSE OF MY 

CAREER? I MEAN, BECAUSE THERE WERE COMPANIES.

Q. WELL, SIR, DIRECTING YOUR ATTENTION TO THE DEPOSITION 

TRANSCRIPT, PAGE 336, COULD YOU REFER TO LINES -- DON'T PUT IT 

UP YET -- 

A. PAGE WHAT? 

Q. PAGE 336, LINES 20 TO 21. DOES THAT REFRESH YOUR 

RECOLLECTION THAT AT LEAST AS OF THE TIME OF YOUR DEPOSITION, 

YOU DID NOT KNOW OF ANY OTHER CHIP SUPPLIERS THAT ALSO HAVE A 

LICENSING PROGRAM LIKE QUALCOMM'S? 

A. I WAS THINKING OF MOTOROLA WHEN YOU ASKED THAT QUESTION, 

AND IT LOOKS LIKE I WAS THINKING ABOUT MOTOROLA ON THIS PAGE AS 

WELL. 

Q. ALL RIGHT. I'LL MOVE ON. 

IT'S CORRECT YOU JOINED QUALCOMM IN 1989; RIGHT? 

A. YES.

Q. YOU WERE EMPLOYED BY QUALCOMM UNTIL 2014? 

A. YES.

Q. YOU WERE AT ONE POINT PRESIDENT OF THE LICENSING BUSINESS? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 19 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

179

A. THAT'S CORRECT.

Q. AND THEN YOU BECAME PRESIDENT OF THE COMPANY IN 

APPROXIMATELY 2004; IS THAT RIGHT? 

A. I'LL -- I'M BAD WITH DATES, BUT I BECAME PRESIDENT AT SOME 

POINT. 2004 IS PROBABLY ABOUT RIGHT. 

Q. AND IN 2011, YOU BECAME VICE CHAIRMAN? 

A. THAT SOUNDS RIGHT AS WELL, YES.

Q. AND WHEN YOU BECAME VICE CHAIRMAN, THE LICENSING DIVISION 

BEGAN TO REPORT TO MR. DEREK ABERLE; IS THAT RIGHT? 

A. IT SEEMS LIKE IT REPORTED TO DEREK BEFORE THAT. WHEN I 

WAS PRESIDENT, I THINK THE LICENSING BUSINESS REPORTED TO 

DEREK, AND THEN DEREK REPORTED TO ME.

Q. WHEN YOU WERE PRESIDENT OF THE COMPANY, SIR, AT YOUR 

DEPOSITION YOU TESTIFIED THAT THE LICENSING DIVISION REPORTED 

TO YOU. 

WAS MR. ABERLE THE PRESIDENT OF THE LICENSING DIVISION AT 

THAT POINT? 

A. I THINK SO. I THINK SO. OR IT MIGHT HAVE BEEN 

MARK BLECKER.

Q. SO AT THE TIME YOU JOINED QUALCOMM, QUALCOMM HAD NOT YET 

LICENSED ITS CDMA TECHNOLOGY TO OTHERS FOR USE IN CELLULAR 

COMMUNICATIONS; IS THAT RIGHT? 

A. THAT'S CORRECT. 

Q. IT'S FAIR TO SAY YOU NEGOTIATED QUALCOMM'S FIRST CDMA 

RELATED PATENT LICENSES WITH AT&T AND WITH MOTOROLA? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 20 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

180

A. YES.

Q. CAN YOU TURN YOUR ATTENTION, SIR, TO THE THIRD TAB OF YOUR 

BINDER, TAB 3. 

YOUR HONOR, I MOVE TO ADMIT JX 0003. 

THE COURT: ANY OBJECTION? 

MR. BORNSTEIN: NO, YOUR HONOR. 

THE COURT: IT'S ADMITTED. 

(JOINT EXHIBIT JX 0003 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Q. SIR, CAN YOU IDENTIFY THIS AS A PATENT LICENSE AGREEMENT 

BETWEEN QUALCOMM AND MOTOROLA? 

A. YES.

Q. DIRECTING YOUR ATTENTION TO THE FIFTH PAGE OF THE 

DOCUMENT, SIR, JX 0003-005, THE LETTER B STATES, "THE ROYALTY 

PAYABLE BY MOTOROLA TO QUALCOMM"; IS THAT FAIR? 

A. YES. 

Q. AND THE ROYALTY ON SUBSCRIBER UNITS, CHANNEL UNITS, AND 

DS-CDMA ENABLED INFRASTRUCTURE IS EITHER 0 OR 4 PERCENT, 

DEPENDING ON OUR TERMS IN THE CONTRACT; IS THAT RIGHT? 

A. YES, UNDER THIS AGREEMENT, YES. 

Q. AND UNDER THAT IS COMPONENTS, AND THE RATE FOR COMPONENTS 

IS 0; IS THAT RIGHT? 

A. YES.

Q. LET'S MOVE UP THE PAGE A LITTLE BIT. AT THE TOP OF THE 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 21 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

181

PAGE, THIS STATES THE ROYALTY PAYABLE BY QUALCOMM TO MOTOROLA 

UNDER THIS AGREEMENT; RIGHT?

A. I'M SORRY. ARE YOU ON THE NEXT PAGE?

Q. NO, TOP OF THE SAME PAGE, SIR. JX 0003-0005. DOES THAT 

STATE THE ROYALTY PAYABLE BY QUALCOMM TO MOTOROLA UNDER THIS 

AGREEMENT? 

A. OH, YES.

Q. AND QUALCOMM PAYS MOTOROLA, ON SUBSCRIBER UNITS AND 

CHANNEL UNITS, A ROYALTY OF EITHER 0 OR 2 PERCENT, DEPENDING ON 

OTHER TERMS IN THE CONTRACT; RIGHT? 

A. YES.

Q. AND IT'S A TRUE STATEMENT THAT IN THE 1990S, QUALCOMM SOLD 

SUBSCRIBER UNITS; RIGHT? 

A. IN THE 1990S?

Q. YES. 

A. YEAH, I THINK SO, DURING THAT TIME.

Q. AND QUALCOMM ALSO HAD AN INFRASTRUCTURE BUSINESS IN THE 

1990S; RIGHT?

A. YES.

Q. CAN YOU TURN, SIR, TO -- AND THERE'S ALSO COMPONENTS UNDER 

QUALCOMM, DO YOU SEE THAT, AND THE ROYALTY THAT QUALCOMM PAYS 

MOTOROLA ON COMPONENTS IS 0; CORRECT? 

A. YES.

Q. JUST LIKE THE ROYALTY MOTOROLA PAYS QUALCOMM ON 

COMPONENTS? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 22 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

182

A. YES. 

Q. WOULD YOU TURN, SIR, TO PAGE JX 0003-014? 

THIS IS THE TECHNICAL DEFINITION SECTION AS IT SAYS ON THE 

PREVIOUS PAGE. 

THE FIRST THREE WORDS ON THIS PAGE ARE "COMPONENTS MEANS 

ASICS"; RIGHT?

A. YES.

Q. IT'S A TRUE STATEMENT THAT IN 1990, QUALCOMM GAVE MOTOROLA 

A LICENSE TO MAKE CDMA COMPLIANT ASICS; ISN'T THAT RIGHT? 

ISN'T THAT RIGHT? 

A. YES. 

Q. IF YOU TURN, SIR, TO TAB 5 IN YOUR BINDER. CAN YOU 

IDENTIFY THIS, SIR, AS AN E-MAIL THAT YOU SENT IRWIN JACOBS AND 

ANOTHER QUALCOMM EXECUTIVE IN 1998? 

A. YES. 

MR. MATHESON: YOUR HONOR, MOVE TO ADMIT CX 8206. 

MR. BORNSTEIN: THERE'S NO OBJECTION, YOUR HONOR. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 8206 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Q. YOU FORWARDED TO MR. JACOBS AN E-MAIL SENT TO YOU BY 

MR. BLECKER; IS THAT RIGHT? 

A. YEP. 

Q. MR. BLECKER'S E-MAIL TO YOU ADDRESSES THE POSSIBILITY OF 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 23 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

183

REDUCING ROYALTIES ON CERTAIN QUALCOMM ASIC SALES; RIGHT? 

A. CAN I READ IT REAL QUICK?

Q. PLEASE, SIR. 

(PAUSE IN PROCEEDINGS.) 

THE WITNESS: OKAY. 

BY MR. MATHESON: 

Q. AND IT STATES IN THE SECOND PARAGRAPH, "BASICALLY BY 

REDUCING ROYALTY, WE ARE DOING NOTHING MORE THAN COMPETING ON 

PRICE WITH OUR ASIC COMPETITORS, THAT IS, IF THE REDUCED OR 

ZERO ROYALTY IS THE INCENTIVE TO BUY Q ASICS, THEN THE SAME 

EFFECT CAN BE ACHIEVED BY SIMPLY REDUCING PRICE ON OUR ASICS BY 

THAT SAME AMOUNT." 

DO YOU SEE THAT, SIR?

A. YES.

Q. NOW, DID YOU NOT AGREE, AND YOU WROTE TO MR. JACOBS, "HIS 

ARGUMENT IS NOT ENTIRELY TRUE GIVEN THAT WE SHARE ROYALTIES, 

BUT DO NOT SHARE ASIC PROFIT." 

NOW, WHAT YOU MEANT THERE IS YOU SHARE ROYALTIES WITH 

MOTOROLA UNDER THE TERMS OF THE 1990 AGREEMENT; IS THAT RIGHT? 

A. I BELIEVE THAT'S WHAT I MEANT. 

ALSO WITH AT&T.

Q. I WAS GOING TO ASK THAT QUESTION NEXT. IT'S ALSO TRUE 

THAT THE INITIAL CDMA AGREEMENT WITH AT&T PROVIDED THAT 

QUALCOMM SHARED THE ROYALTIES IT COLLECTED FROM OTHER LICENSEES 

WITH AT&T; RIGHT? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 24 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

184

A. THAT'S TRUE. 

Q. TURN TO THE NEXT TAB IN YOUR BINDER, SIR, CX 6983. IT'S 

TAB 6 IN YOUR BINDER. 

A. CAN I -- ONE CAVEAT TO THAT LAST ONE. 

I DON'T KNOW FROM A TIMING STANDPOINT BECAUSE WE, WE 

NEGOTIATED WITH AT&T AND GOT A LIMITED ROYALTY SHARE. I DON'T 

KNOW IF IT WAS AFTER THIS OR BEFORE THIS. SO -- 

Q. THANK YOU, SIR. 

NEXT TAB IN YOUR BINDER IS TAB 6, CX 6983. CAN YOU 

IDENTIFY THIS AS AN E-MAIL THAT YOU FORWARDED TO 

MR. DEREK ABERLE IN 2004? 

A. YES. 

MR. MATHESON: YOUR HONOR, MOVE TO ADMIT CX 6983. 

MR. BORNSTEIN: NO OBJECTION, YOUR HONOR. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 6983 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Q. TURNING TO THE SECOND PAGE OF THE DOCUMENT, ARABIC NUMERAL 

3 -- STRIKE THAT. 

YOU FORWARDED TO MR. ABERLE AN E-MAIL THAT YOU HAD WRITTEN 

TO MR. KEITH BAIN OF MOTOROLA; IS THAT RIGHT? 

A. YES.

Q. OKAY. TURNING TO THE SECOND PAGE OF THE DOCUMENT, ARABIC 

NUMERAL 3 BEGINS "ROYALTY SHARING IN ANY CASE ENDS IN SEPTEMBER 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 25 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

185

2005." 

DO YOU SEE THAT, SIR? 

A. YES.

Q. SO YOU TOLD MOTOROLA -- OR IT'S A TRUE STATEMENT THAT THE 

ROYALTY SHARING AGREED TO BETWEEN QUALCOMM AND MOTOROLA LASTED 

FROM 1990 UNTIL 2005 UNDER THE TERMS OF THE ORIGINAL CDMA 

LICENSE THAT YOU NEGOTIATED WITH MOTOROLA; IS THAT RIGHT? 

A. MY RECOLLECTION IS THAT IT, IT -- THAT IS WHEN IT ENDED. 

I'M JUST -- I DON'T REMEMBER -- 

Q. THANK YOU, SIR. 

A. -- TERMINATED IT EARLIER OR NOT, BUT I DON'T THINK SO. 

Q. NOW, STEPPING BACK FOR A MINUTE, DURING YOUR TIME AT 

QUALCOMM, IT'S FAIR TO SAY THAT QUALCOMM'S POLICY WAS TO NOT 

PROVIDE CHIPSETS TO NON-LICENSEES; RIGHT? 

A. YES. 

Q. AND IT'S FAIR TO SAY ON SOME OCCASIONS QUALCOMM REMINDED 

ITS LICENSEES THAT IF THEY DIDN'T ABIDE BY THEIR LICENSING 

AGREEMENTS, THERE WAS A RISK THAT THEIR CHIPSET SUPPLY WOULD BE 

IMPACTED; RIGHT? 

A. YES. 

Q. WOULD YOU PLEASE TURN TO THE NEXT TAB IN YOUR BINDER, SIR, 

TAB 7. THIS IS CX 6729. 

CAN YOU IDENTIFY THIS, SIR, AS AN E-MAIL THAT YOU WERE 

COPIED ON, SENT BY MR. IRWIN MARK JACOBS TO A SAMSUNG EXECUTIVE 

IN 2001? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 26 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

186

THE WITNESS: YES. 

MR. MATHESON: MOVE TO ADMIT, YOUR HONOR, CX 6729. 

MR. BORNSTEIN: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 6729 WAS ADMITTED.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Q. NOW, MR. JACOBS WROTE THIS LETTER, OR E-MAIL, TO SAMSUNG 

IN THE CONTEXT OF A LICENSING DISPUTE BETWEEN QUALCOMM AND 

SAMSUNG; RIGHT? 

A. YES. 

Q. COULD YOU TAKE A LOOK AT THE THIRD PARAGRAPH THAT BEGINS, 

"HOWEVER, IT HAS BEEN BROUGHT TO MY ATTENTION THAT OUR AUDITORS 

DISCOVERED THAT SAMSUNG HAS PURPOSEFULLY NOT REPORTED ROYALTIES 

PAYABLE UNDER OUR AGREEMENT FOR SAMSUNG'S SALES OF CDMA 2000 1X 

INFRASTRUCTURE AND SUBSCRIBER EQUIPMENT DURING THE FIRST 

CALENDAR QUARTER OF 2001. APPARENTLY SAMSUNG IS TAKING THE 

POSITION THAT 1X IS NOT PART OF SAMSUNG'S EXISTING LICENSE 

AGREEMENT." 

DO YOU SEE THAT, SIR? 

A. YES.

Q. NOW, CDMA 1X -- CDMA 2000 1X IS A 3G STANDARD; IS THAT 

RIGHT, SIR? 

A. YES, I BELIEVE IT WAS CONSIDERED 3G. 

Q. NOW, SAMSUNG TOOK THE POSITION THAT ITS EXISTING CDMA 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 27 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

187

LICENSE AGREEMENT DID NOT APPLY TO ITS SALES OF 3G 

INFRASTRUCTURE AND SUBSCRIBER EQUIPMENT; RIGHT? 

A. THAT'S WHAT I THINK THIS IS SAYING, YES.

Q. CAN YOU TURN TO THE NEXT PAGE OF THE DOCUMENT, SIR. THE 

FIRST PARAGRAPH ON THIS PAGE, THE LAST TWO SENTENCES READ, 

"THUS, IF SAMSUNG PERSISTS IN TAKING THE POSITION THAT ITS 

LICENSE AGREEMENT DOES NOT COVER 1X AND DOES PAY QUALCOMM THE 

1X ROYALTIES DUE UNDER THE AGREEMENT, WE WILL HAVE NO CHOICE 

BUT TO TAKE ALL ACTION NECESSARY TO ENFORCE THE TERMS OF OUR 

LICENSE AGREEMENT, INCLUDING POSSIBLE TERMINATION. UNDER OUR 

AGREEMENTS, WE DO NOT SHIP ASICS TO NON-LICENSEES OR TO 

LICENSEES WHO ARE NOT PERFORMING THEIR OBLIGATIONS." 

NOW, IN THAT CONTEXT, 1X MEANS CDMA 2000 3G; CORRECT? 

A. YEAH. I MEAN, CDMA 2000 1X, YEAH. 

Q. SO, MR. JACOBS, IN EFFECT, TOLD SAMSUNG, YOU HAVE TO AGREE 

THAT THE EXISTING LICENSE COVERS BOTH 2G AND 3G OR ELSE 

QUALCOMM WOULD TAKE ALL ACTION NECESSARY, INCLUDING POSSIBLE 

TERMINATION OF THE LICENSE; RIGHT? 

A. THE AGREEMENT COVERS CDMA, AND THEY WERE TAKING THE 

POSITION THAT THEY WEREN'T GOING TO PAY ROYALTIES FOR A NEW 

REVISION OF CDMA. 

Q. WHEN YOU SAY "NEW REVISION OF," MY QUESTION, SIR, IS 

SAMSUNG TOOK THE POSITION THEIR EXISTING LICENSE DID NOT COVER 

3G CDMA; IS THAT CORRECT? 

A. WELL, THEY STOPPED -- YEAH, THEY STOPPED REPORTING 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 28 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

188

ROYALTIES AND REFUSED TO PAY. 

Q. AND MR. JACOBS INFORMED THEM THAT THEIR LICENSE AGREEMENT 

WOULD BE TERMINATED IF THEY MAINTAINED THAT POSITION; RIGHT? 

A. YEAH. 

Q. OR COULD BE TERMINATED? 

A. TAKE ALL ACTION NECESSARY TO ENFORCE THE TERMS, INCLUDING 

POSSIBLE TERMINATION.

Q. NOW, THAT WOULD HAVE TERMINATED THEIR LICENSE TO BOTH 2G 

CDMA TECHNOLOGY AND TO 3G CDMA TECHNOLOGY; RIGHT? 

A. AND TO WCDMA. I MEAN, THEY WERE LICENSED FOR OUR 

TECHNOLOGIES FOR ALL CDMA APPLICATIONS. SO WHEN THEY STOPPED 

REPORTING AND WERE IN BREACH, WE, WE TOLD THEM WE WOULD HAVE TO 

ENFORCE THE TERMS OF OUR AGREEMENT. 

Q. AND IF QUALCOMM HAD TERMINATED THE EXISTING LICENSE 

AGREEMENT, QUALCOMM WOULD HAVE STOPPED SHIPPING ASICS FOR ALL 

TECHNOLOGIES COVERED BY THAT LICENSING AGREEMENT; CORRECT? 

A. WELL, NONE OF THAT HAPPENED. BUT IF -- OUR POLICY IS WE 

WOULD ONLY SHIP TO LICENSEES, SO, YOU KNOW, I BELIEVE THAT IF 

SOMEBODY BLATANTLY VIOLATED THE AGREEMENT AND STOPPED PAYING US 

ROYALTIES AND WE HAD TO ENFORCE AND WE ENDED UP EVENTUALLY 

TERMINATING BECAUSE OF THEIR MATERIAL BREACH, THEN THAT WOULD 

TERMINATE THE WHOLE -- THE ENTIRE RELATIONSHIP.

Q. AND WHEN YOU SAY TERMINATE THE ENTIRE RELATIONSHIP, THAT 

MEANS IF A LICENSE AGREEMENT COVERS BOTH 2G CDMA AND WCDMA AND 

THAT LICENSE AGREEMENT IS TERMINATED, QUALCOMM WILL NOT SHIP 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 29 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

189

THAT FORMER LICENSEE CHIPS RELATED TO EITHER 2G CDMA OR WCDMA; 

RIGHT? 

A. AGAIN, NONE OF THIS HAS EVER HAPPENED. 

BUT IF, IF A COMPANY WOULD HAVE MATERIALLY BREACHED THEIR 

AGREEMENT REQUIRING US TO ENFORCE AND TERMINATE, SO THEY 

WEREN'T HONORING OUR I.P., THEN WE WOULD NOT SHIP OUR CHIPS TO 

THEM AND THAT WOULD BE THE CASE IF THEY JUST DECIDED THEY WERE 

GOING TO BREACH WITH RESPECT TO CDMA 2000 OR CDMA 1X OR IS 95. 

Q. RIGHT. IF THEY BREACHED WITH RESPECT TO -- 

A. CDMA 1, I GUESS.

Q. -- CDMA 2000, QUALCOMM WOULD NOT SHIP THEM CDMA 1 CHIPS? 

A. AGAIN, THIS IS ALL SPECULATION BECAUSE I DON'T THINK THIS 

EVER HAPPENED, BUT -- 

Q. FAIR STATEMENT, SIR. I'M JUST TRYING TO UNDERSTAND THE 

POLICY. 

OKAY. TURN TO TAB 10 OF YOUR BINDER, SIR. SORRY. TAB 9 

IN YOUR BINDER. THIS IS CX 8281. 

CAN YOU IDENTIFY THIS, SIR, AS AN E-MAIL EXCHANGE IN WHICH 

YOU WERE INVOLVED IN 2004? 

A. YES. 

MR. MATHESON: YOUR HONOR, MOVE TO ADMIT CX 8281. 

MR. BORNSTEIN: NO OBJECTION, YOUR HONOR. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 8281 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 30 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

190

BY MR. MATHESON: 

Q. TURN TO THE BOTTOM OF PAGE 2. THERE'S AN E-MAIL FROM 

MR. HUANG OF BENQ. DO YOU SEE THAT E-MAIL, SIR?

A. YES.

Q. AND THAT E-MAIL IS ADDRESSED TO AN EXECUTIVE AT QUALCOMM, 

MR. KANG? 

A. I WOULDN'T CALL HIM AN EXECUTIVE. HE WAS SOMEBODY THAT 

WAS MID-LEVEL, I GUESS. 

Q. AND BENQ INFORMED THE QUALCOMM EMPLOYEE THAT -- TURNING 

YOUR ATTENTION TO THE DISCOUNT TABLE AT THE TOP OF PAGE 3, 

CX 8281-003, FAIR TO SAY THAT BENQ WAS REQUESTING A ROYALTY 

DISCOUNT BASED ON THE SELLING PRICE OF ITS HANDSETS AT THIS 

TIME? IS THAT FAIR? 

A. I DON'T REMEMBER BENQ, BUT THAT'S WHAT THIS LOOKS TO BE 

DOING.

Q. OKAY. TURNING YOUR ATTENTION TO THE FIRST PAGE OF THIS 

DOCUMENT, SIR, THIS E-MAIL IS FORWARDED TO YOURSELF, YOU 

FORWARD IT ON. CX 8281-001. 

YOU FORWARD IT ON TO OTHERS, THAT PORTION HAS BEEN 

REDACTED. 

MR. JACOBS WRITES -- MR. JEFF JACOBS WRITES, "CERTAINLY 

SEND WAVES AROUND THE INDUSTRY IF THEY LOSE THEIR LICENSE AS 

THEY HAVE MADE A VISIBLE COMMITMENT TO CDMA AND WCDMA." 

HE'S REFERRING TO BENQ WHEN HE SAYS "THEY;" IS THAT 

CORRECT? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 31 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

191

A. I DON'T KNOW. PROBABLY. 

Q. AND THEN MR. THORNLEY WRITES NEXT, "A SITUATION WE SHOULD 

WORK HARD TO FIX RATHER THAN TERMINATE. HOWEVER, THE THREAT 

MAY BE WHAT IS NEEDED." 

NOW, MR. THORNLEY STARTED AS THE CFO OF QUALCOMM AND THEN 

BECAME ITS PRESIDENT; IS THAT RIGHT? 

A. YES.

Q. AND THEN YOU RESPOND IN YOUR SECOND SENTENCE OF YOUR 

E-MAIL, YOU WROTE, "WE HAVE MADE THE THREAT. HOPEFULLY THEY 

WILL RESPOND POSITIVELY. IF THEY DON'T RESPOND, I WILL TRY TO 

HOLD OFF ANY TERMINATION UNTIL AFTER WE RECEIVE THE TERMINALS." 

WHEN YOU SAID "WE HAVE MADE THE THREAT," YOU MEANT 

QUALCOMM HAD THREATENED TO TERMINATE BENQ'S LICENSE; RIGHT? 

A. IS THAT IN THE BODY OF THIS? I DON'T KNOW WHAT THE -- IT 

MIGHT HAVE BEEN TO TERMINATE THE LICENSE. IT MIGHT HAVE BEEN 

DEALING WITH CHIPS. I DON'T KNOW. 

Q. YOU WROTE THAT E-MAIL ON OCTOBER 6TH OF 2004; CORRECT, 

SIR? 

A. YES.

Q. CAN YOU TURN TO THE NEXT TAB. 

YOUR HONOR, I MOVE TO ADMIT JX 0030. 

MR. BORNSTEIN: THERE'S NO OBJECTION, YOUR HONOR. 

THE COURT: IT'S ADMITTED. 

(JOINT EXHIBIT JX 0030 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 32 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

192

BY MR. MATHESON: 

Q. THIS IS SUBSCRIBER UNIT LICENSE AGREEMENT ENTERED INTO ON 

JANUARY 6TH, 2005, BETWEEN QUALCOMM AND BENQ; RIGHT? 

A. YES. 

Q. THAT'S THREE MONTHS AFTER THE E-MAIL WE JUST DISCUSSED; 

RIGHT? 

A. YES. 

Q. TURN TO THE NEXT TAB IN YOUR BINDER, SIR, WHICH IS TAB 11, 

CX 7141. 

CAN YOU IDENTIFY THIS AS AN E-MAIL EXCHANGE BETWEEN 

YOURSELF AND MR. DEREK ABERLE? 

A. CAN I -- I'M SORRY. ONE QUICK THING. WHEN YOU WERE 

ASKING ME ABOUT WHETHER IT WAS A THREAT TO TERMINATE THEIR 

LICENSE, AND THEN YOU SHOW ME A LICENSE THAT IS MONTHS LATER, 

SO I DON'T KNOW, MAYBE IT WASN'T A THREAT TO TERMINATE A 

LICENSE.

Q. OR MAYBE YOU THREATENED TO TERMINATE THEIR LICENSE AND 

THEY SIGNED A NEW LICENSE THREE MONTHS LATER. THAT'S ENTIRELY 

PLAUSIBLE; ISN'T THAT RIGHT? 

A. I DON'T KNOW. I DON'T REMEMBER. 

Q. OKAY. CAN YOU TURN TO THE NEXT TAB IN YOUR BINDER, SIR, 

TAB 11, WHICH IS CX 7141. CAN YOU IDENTIFY THIS AS AN E-MAIL 

EXCHANGE BETWEEN YOURSELF AND MR. DEREK ABERLE IN DECEMBER OF 

2004?

A. YES.

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 33 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

193

Q. NOW, AT THIS TIME THERE WAS A LICENSE IN PLACE BETWEEN 

QUALCOMM AND NOKIA THAT WOULD EXPIRE IN 2007 UNLESS NOKIA 

ENTERED -- EXERCISED AN OPTION TO EXTEND. 

IS THAT CORRECT, SIR? 

A. YEAH, THAT'S THE WAY I RECALL IT. THEY HAD AN OPTION TO 

KEEP THE AGREEMENT GOING IF THEY WANTED TO. 

MR. MATHESON: YOUR HONOR, MOVE TO ADMIT CX 7141 INTO 

EVIDENCE. 

MR. BORNSTEIN: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 7141 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Q. NOW, MR. ABERLE WRITES TO YOU IN THE THIRD SENTENCE OF HIS 

E-MAIL THAT "I THINK WE SHOULD DO ALL WE CAN TO GET NOKIA TO 

DESIGN OUR DO CHIPS INTO THEIR PRODUCTS (AS OPPOSED TO NOKIA 

JUST BUYING DO DEVICES FROM OUR OEM LICENSEES). IF NOKIA 

REFUSES TO EXERCISE THE OPTION IN 2007, WE WOULD HAVE THE RIGHT 

TO CUT OFF THEIR DO CHIPS. THIS MAY BE ENOUGH TO KEEP THEM 

FROM STRINGING US OUT UNTIL 2008 WHEN THE OPTION EXPIRES." 

NOW, WHEN MR. ABERLE REFERS TO THE OPTION, HE'S REFERRING 

TO NOKIA'S 2007 OPTION TO EXTEND ITS LICENSE WITH QUALCOMM; 

RIGHT? 

A. YES. 

Q. AND YOU WRITE TO HIM, IT IS THE EXACT THOUGHT THAT I HAVE 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 34 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

194

HAD; RIGHT? 

A. YES.

Q. AND WHEN YOU SAID IT IS THE EXACT THOUGHT HE HAS HAD, YOU 

MEANT IT WOULD BE BENEFICIAL TO QUALCOMM IF NOKIA DESIGNED 

QUALCOMM'S CHIPS INTO THEIR PRODUCTS; RIGHT? 

A. I THINK IT WOULD HAVE BEEN -- IT WOULD HAVE BEEN 

BENEFICIAL FOR QUALCOMM AND NOKIA IF THEY HAD DONE THAT. THEY 

MIGHT HAVE SUCCEEDED IN SELLING DO HANDSETS.

Q. TURN TO THE NEXT TAB IN YOUR BINDER, SIR, WHICH IS TAB 12, 

CX 6987. 

CAN YOU IDENTIFY THIS, SIR, AS AN E-MAIL EXCHANGE IN WHICH 

YOU WERE INVOLVED IN MAY OF 2005? 

A. YES. 

MR. MATHESON: YOUR HONOR, MOVE TO ADMIT CX 6987. 

MR. BORNSTEIN: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 6987 WAS ADMITTED.) 

THE COURT: GO AHEAD, PLEASE.

BY MR. MATHESON: 

Q. IN THE LAST E-MAIL AT THE BOTTOM OF THIS PAGE, 

MR. IRWIN JACOBS WRITES, "NOT SURE IF STEVE TOLD YOU, BUT I 

HAVE COME AROUND TO YOUR POSITION ON NOKIA." 

DO YOU SEE THAT, SIR? 

A. YES.

Q. AND THEN YOU RESPOND, "AS FAR AS A GAP FILLER FOR THEM, 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 35 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

195

SALE OF DO CHIPS EITHER DIRECTLY OR THROUGH AN ODM, I WOULD 

STAY FIRM ON A POSITION THAT WE WILL SELL THEM OR AN ODM THE 

CHIPS AND THE LATEST VERSIONS WE HAVE, BUT ONLY AS LONG AS THEY 

PAY US THE CURRENT ROYALTIES WITH NO RECOURSE, AND AS SOON AS 

THEY STOP PAYING ROYALTIES, WE STOP SHIPPING." 

NOW, "THEY" REFERRED TO NOKIA IN THAT SENTENCE, DOESN'T 

IT? 

A. YES, I BELIEVE SO. 

Q. TURN TO THE NEXT TAB IN YOUR BINDER, SIR, WHICH IS TAB 13, 

CX 6979. 

CAN YOU IDENTIFY THIS, SIR, AS E-MAIL CORRESPONDENCE FROM 

2005 IN WHICH YOU WERE INVOLVED? 

A. DEFINITELY I WAS, YEAH, AN E-MAIL THAT I WAS INVOLVED. 

MR. MATHESON: YOUR HONOR, MOVE TO ADMIT CX 6979. 

MR. BORNSTEIN: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 6979 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Q. COULD YOU TURN TO CX 6979-006. ON THE FIRST FULL 

PARAGRAPH AFTER A BUNCH OF CARETS, THE FIRST SENTENCE READS, 

"AS WE EXPLAINED DURING OUR MEETING, QUALCOMM'S LONGSTANDING 

POLICY IS THAT WE DO NOT SELL COMMERCIAL QUANTITIES OF CHIPS TO 

SOMEONE THAT IS NOT LICENSED TO USE THOSE CHIPS." 

SIR, DO YOU RECALL IDENTIFYING THOSE WORDS AS WRITTEN BY 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 36 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

196

YOURSELF TO NOKIA DURING YOUR DEPOSITION? 

I CAN REFRESH YOUR RECOLLECTION, SIR. PAGE 115 OF YOUR 

DEPOSITION TRANSCRIPT, LINES 22, THROUGH 116, LINE 4. 

DOES THAT REFRESH YOUR RECOLLECTION THAT AT YOUR 

DEPOSITION YOU TESTIFIED THAT YOU WROTE, "AS WE EXPLAINED 

DURING OUR MEETING, QUALCOMM'S LONGSTANDING POLICY IS THAT WE 

DO NOT SELL COMMERCIAL QUANTITIES OF CHIPS TO SOMEONE THAT IS 

NOT LICENSED TO USE" THAT -- "THOSE CHIPS." 

A. YEAH. I DON'T KNOW -- IT DOESN'T REFRESH MY RECOLLECTION, 

BUT I PROBABLY HAD MORE TIME AT THE DEPO TO KIND OF READ AND 

SEE THAT IT CAME FROM ME.

Q. SITTING HERE TODAY, SIR, DO YOU BELIEVE THAT YOU WROTE 

THOSE WORDS? 

A. I THINK SO.

Q. THANK YOU. 

MOVE TO THE NEXT TAB IN YOUR BINDER, SIR, WHICH IS 

CX 7799. CAN YOU IDENTIFY THIS, SIR, AS AN E-MAIL YOU WROTE IN 

2000? 

A. YES. 

MR. MATHESON: YOUR HONOR, MOVE TO ADMIT CX 7799. 

MR. BORNSTEIN: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 7799 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 37 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

197

Q. YOU WROTE THIS E-MAIL TO AN EXECUTIVE AT MOTOROLA; IS THAT 

CORRECT? 

A. YES. 

Q. THE THIRD SENTENCE OF THE E-MAIL READS, "NOW, WHEN WE 

INQUIRE ABOUT THE LICENSE AND MOTOROLA'S COMMITMENT TO THE 

INDUSTRY TO LICENSE ITS ESSENTIAL PATENTS, MOTOROLA'S RESPONSE 

IS THAT IT DOESN'T GRANT SUCH LICENSES." 

NOW, JUST FOCUSSING ON THAT PART OF THE SENTENCE, WHEN YOU 

WROTE "MOTOROLA'S COMMITMENT TO THE INDUSTRY TO LICENSE ITS 

ESSENTIAL PATENTS," YOU WERE REFERRING TO MOTOROLA'S FRAND 

COMMITMENTS TO STANDARD SETTING ORGANIZATIONS; IS THAT FAIR? 

A. I BELIEVE SO. 

Q. TURN YOUR ATTENTION, SIR, TO THE NEXT TAB IN YOUR BINDER, 

TAB 15, WHICH IS CX 8177. 

CAN YOU IDENTIFY THIS, SIR, AS AN E-MAIL YOU WROTE IN 1999 

TO MR. LUPIN AND MR. BLECKER? 

A. YES. 

Q. TURNING YOUR ATTENTION TO THE FINAL TWO SENTENCES ON THE 

FIRST PAGE AND THE FIRST SENTENCE ON THE SECOND PAGE -- 

OH, YOUR HONOR, MOVE TO ADMIT CX 8177? 

MR. BORNSTEIN: THERE'S NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 8177 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 38 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

198

Q. THE FINAL FULL SENTENCE ON THE FIRST PAGE READS, "THEY 

HAVE POINTED OUT TO US THAT WE MADE A COMMITMENT IN A 1994 

AGREEMENT THAT WE WOULD LICENSE THEM ON TERMS TO BE NEGOTIATED. 

THAT COMBINED WITH OUR COMMITMENT TO THE INDUSTRY TO LICENSE ON 

FAIR AND REASONABLE TERMS FREE FROM UNFAIR DISCRIMINATION WOULD 

MAKE IT DIFFICULT TO ARGUE THAT WE HAVE THE RIGHT TO REFUSE TO 

LICENSE THEM." 

"THEM" REFERS TO INTEL IN THAT EXCHANGE; IS THAT CORRECT, 

SIR?

A. THAT'S THE WAY I READ IT. 

Q. TURN YOUR ATTENTION, SIR, TO TAB 16 IN YOUR BINDER, WHICH 

IS CX 7580. 

CAN YOU IDENTIFY THIS AS AN E-MAIL THAT YOU FORWARDED TO 

MR. ABERLE AND OTHERS IN 2004? 

A. YES. 

MR. MATHESON: YOUR HONOR, MOVE TO ADMIT CX 7580. 

MR. BORNSTEIN: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 7580 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Q. TURN TO THE NEXT TAB IN YOUR BINDER, TAB 17. THIS IS 

CX 6663. 

CAN YOU IDENTIFY THIS AS AN E-MAIL THAT YOU -- AN E-MAIL 

EXCHANGE IN WHICH YOU WERE INVOLVED WITH PAUL JACOBS AND OTHER 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 39 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

199

QUALCOMM EXECUTIVES IN 2009? 

A. YES. 

MR. MATHESON: YOUR HONOR, MOVE TO ADMIT CX 6663. 

MR. BORNSTEIN: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 6663 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Q. PLEASE TURN TO THE NEXT TAB IN YOUR BINDER, WHICH IS TAB 

18. THIS IS CX 6992. 

CAN YOU IDENTIFY THIS, SIR, AS AM E-MAIL THAT YOU 

RECEIVED, TURNING YOUR ATTENTION TO THE CENTER OF THE PAGE, IN 

DECEMBER OF 2007? 

A. YES. 

MR. MATHESON: YOUR HONOR, MOVE TO ADMIT CX 6992. 

MR. BORNSTEIN: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 6992 WAS ADMITTED IN EVIDENCE.) 

BY MR. MATHESON: 

Q. CAN YOU TURN YOUR ATTENTION TO 6992-002, THE FIRST PAGE OF 

A SLIDE DECK.

NOW, THIS IS A DECK THAT DEALS WITH PROJECT BERLIN; IS 

THAT CORRECT?

A. YES. 

Q. TURNING YOUR ATTENTION TO THE SECOND, THIRD, AND FOURTH 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 40 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

200

BULLETS ALL HAVE STEVE A IN PARENTHESES BEHIND THEM. 

DO YOU SEE THAT?

A. YES.

Q. AND THAT REFERS TO YOU; CORRECT? 

A. YES. 

Q. THE SECOND BULLET READS "COMPETITIVE RESPONSE, STEVE A." 

THAT IS A SECTION OF THIS AGREEMENT FOR WHICH YOU HAD SOME 

RESPONSIBILITY; IS THAT RIGHT? 

SORRY. STRIKE THAT. 

THAT IS A SECTION OF THIS DECK IN WHICH YOU HAD SOME 

INVOLVEMENT; IS THAT RIGHT?

A. THAT'S HOW I WOULD READ THIS, YEAH.

Q. AND TURNING YOUR ATTENTION TO THE FINAL BULLET ON THE 

PAGE, OR SECOND TO FINAL BULLET, IT READS "LEGAL -- DEVELOP 

SUMMARY POINTS FOR COMPETITIVE RESPONSE DISCUSSION, WHITE PAPER 

TO BE INCLUDED IN APPENDIX," AND IT INDICATES YOURSELF AND 

PAUL SYROWIK AS ASSOCIATED WITH THAT ITEM. 

DO YOU SEE THAT, SIR? 

A. YEAH, SIR. 

Q. TURN YOUR ATTENTION, SIR, TO CX 6022-035. 

A. IS THAT THE SAME EXHIBIT? I'M SORRY. 

Q. YEAH. 6992-035. YES, SIR. SAME EXHIBIT, PAGE 35. 

A. PAGE 35.

Q. IT READS AT THE TOP, "COMPETITIVE RESPONSE TO POTENTIAL 

RESTRUCTURE." 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 41 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

201

A. YEAH. 

Q. DO YOU SEE THAT? 

A. YES. 

Q. NOW, THIS IS THE PORTION, OR A PORTION OF THE DECK THAT 

YOU'RE ASSOCIATED WITH ACCORDING TO THE SLIDE WE JUST LOOKED 

AT; IS THAT CORRECT? THE COMPETITIVE RESPONSE? 

A. YEAH, I THINK SO, YEAH. 

Q. THE FIRST BULLET ON THE SLIDE READS, "OTHER LICENSEES." 

AND THE FIRST SUB BULLET READS, "POST SPIN, MANY CURRENT QCT 

CUSTOMERS MAY AGGRESSIVELY" -- "MAY MORE AGGRESSIVELY SEEK TO 

CHALLENGE CERTAIN ASPECTS OF OUR LICENSING BUSINESS AND/OR 

THEIR AGREEMENTS WITH QUALCOMM." 

DO YOU SEE THAT, SIR? 

A. YES.

Q. NOW, SPIN, AS IT'S USED IN THAT BULLET, REFERS TO THE 

PROPOSAL TO SEPARATE QUALCOMM'S CHIPSET OPERATIONS AND THE 

LICENSING OPERATIONS; IS THAT FAIR? 

A. YES. 

Q. AND THE CONCERN THIS BULLET -- OR STRIKE THAT. 

THIS BULLET SUGGESTS THAT COMPANIES THAT ARE PURCHASING 

CHIPSETS FROM QUALCOMM -- FROM QCT WOULD BE MORE LIKELY TO 

CHALLENGE THEIR AGREEMENTS WITH QTL POST SPIN THAN THOSE SAME 

COMPANIES WOULD BE TO CHALLENGE THEIR AGREEMENTS PRE SPIN? 

THAT'S FAIR; RIGHT? 

A. YEAH. I MEAN, BASICALLY WE HAD VERY STRONG RELATIONSHIPS 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 42 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

202

WITH THESE COMPANIES THROUGH OUR CHIP BUSINESS, PROVIDING THEM 

THE LATEST SOFTWARE, THE LATEST INNOVATION. 

AND COMPANIES -- THE LICENSEES, YOU KNOW, THEY WOULD SIGN 

AN AGREEMENT ONE DAY AND THE NEXT DAY TRY TO FIGURE OUT HOW TO 

NOT PAY THE ROYALTIES THAT THEY AGREED TO PAY. 

SO IF YOU TAKE THE TWO BUSINESSES AND SEPARATE THEM AND 

QTL BECOMES JUST SOLELY A, YOU KNOW, PATENT LICENSING COMPANY, 

THEN THE THOUGHT WAS THAT EVERY COMPANY WOULD BE MUCH MORE 

AGGRESSIVE IN JUST TRYING TO MAKE WHATEVER ARGUMENTS THEY CAN 

TO TRY TO NOT PAY THE ROYALTIES THAT THEY'D AGREED TO PAY.

Q. ONE ARGUMENT THAT'S AVAILABLE TO COMPANIES TRYING TO NOT 

PAY ROYALTIES THAT THEY AGREED TO PAY WOULD BE TO BRING A CLAIM 

THAT QUALCOMM'S ROYALTIES DID NOT COMPORT WITH QUALCOMM'S FRAND 

COMMITMENTS; ISN'T THAT RIGHT? 

A. THEY WOULD TRY THAT. THEY WOULD TRY MOST FAVORED 

ARGUMENTS, THEY WOULD -- THEY WOULD SAY THEY'RE NOT LICENSED 

FOR STUFF THAT THEY WERE OBVIOUSLY LICENSED FOR. 

THEY WOULD HIDE ROYALTIES THAT THEY WERE REQUIRED TO PAY 

THROUGH THE AUDIT PROCESS. 

I MEAN, THEY -- LICENSEES WOULD BE VERY AGGRESSIVE IN 

TRYING NOT TO PAY ROYALTIES.

Q. AND JUST -- MY QUESTION WAS QUITE LIMITED, SIR. ONE 

AVAILABLE ALTERNATIVE TO COMPANIES SEEKING TO REDUCE THE 

ROYALTIES THEY'D AGREED TO PAY QUALCOMM WOULD BE TO PURSUE A 

FRAND CLAIM; IS THAT FAIR?

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 43 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

203

A. THEY COULD PURSUE WHATEVER THEY WANTED TO; RIGHT? THAT 

WOULD BE ONE OF THE THINGS THEY COULD PURSUE. AND THEY COULD 

PURSUE IT AS ONE COMPANY AS WELL.

Q. LET'S MOVE ON TO THE NEXT BULLET, SIR. THE NEXT BULLET 

READS, "SOME CONCERN THAT A QCT SPIN COULD CAUSE SEVERAL OF OUR 

CHINESE LICENSEES TO STOP PAYING ROYALTIES OR OTHERWISE CONTEST 

THE TERMS OF THEIR LICENSE AGREEMENTS." 

DO YOU SEE THAT, SIR? 

A. YES.

Q. NOW, QUALCOMM WOULD BE BETTER ABLE TO ADDRESS THE ISSUE OF 

CHINESE LICENSEES WHO STOPPED PAYING ROYALTIES PRE SPIN THAN IT 

WOULD BE POST SPIN BECAUSE AS ONE COMPANY, IF A CHINESE COMPANY 

JUST STOPPED PAYING ROYALTIES, QUALCOMM COULD TERMINATE ITS 

LICENSE AND NOT SELL THEM CHIPS; RIGHT? 

A. YEAH. YOU'RE KIND OF NARROWLY FOCUSSING.

Q. CAN I DIRECT YOU TO PAGE 187 OF YOUR DEPOSITION 

TRANSCRIPT, SIR, LINES 2 TO 13. 

A. WHAT PAGE?

Q. PAGE 187, LINES 2 TO 13. 

DIRECTING YOUR ATTENTION TO THAT PORTION OF YOUR 

DEPOSITION TRANSCRIPT, IT'S A TRUE STATEMENT THAT AS ONE 

COMPANY, IF A CHINESE COMPANY JUST STOPPED PAYING ROYALTIES, 

THEN QUALCOMM COULD TERMINATE THEIR LICENSE AND NOT SELL THEM 

CHIPS? 

IS THAT A TRUE STATEMENT, SIR?

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 44 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

204

A. YES. BUT -- CAN I ANSWER -- 

Q. NOW, LET'S FOCUS -- SIR, CAN I FOCUS -- 

A. OKAY.

Q. -- ON THE SECOND CONCERN HIGHLIGHTED IN THIS BULLET. 

MR. BORNSTEIN: YOUR HONOR, CAN THE WITNESS BE 

PERMITTED TO FINISH HIS ANSWER, PLEASE? 

MR. MATHESON: YOUR HONOR -- 

THE COURT: HE CAN DO THAT ON REDIRECT. OR CROSS. 

GO AHEAD, PLEASE. 

MR. MATHESON: THANK YOU, YOUR HONOR. 

Q. NOW, LET'S FOCUS ON THE SECOND CONCERN HIGHLIGHTED IN THIS 

BULLET, WHICH IS "AS OPPOSED TO JUST STOP PAYING ROYALTY, 

CHINESE LICENSEES MIGHT OTHERWISE CONTEST THE TERMS OF THEIR 

LICENSE AGREEMENT." 

NOW, ANOTHER WAY, OTHER THAN PAYING ROYALTIES, THAT THEY 

MIGHT CONTEST THE TERMS OF THEIR LICENSE AGREEMENT IS TO BRING 

A FRAND CLAIM ALLEGING THAT QUALCOMM'S ROYALTIES DID NOT 

COMPORT WITH ITS FRAND OBLIGATIONS. 

IS THAT FAIR? 

A. YEAH. LIKE I SAID, I THINK COMPANIES CAN DO THAT IF WE 

SPUN, IF WE DIDN'T SPIN. THEY COULD CERTAINLY DO IT -- -- 

Q. BUT THERE'S CERTAINLY A CONCERN, HIGHLIGHTED IN THE FIRST 

BULLET, THAT POST SPIN CUSTOMERS WHO ARE CURRENTLY BUYING FROM 

QCT WOULD MORE AGGRESSIVELY BRING CHALLENGES, SUCH AS FRAND 

CHALLENGES. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 45 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

205

THAT'S A FAIR READING OF THAT FIRST POINT, RIGHT? 

A. MAY MORE AGGRESSIVELY. NOT WOULD. 

Q. NOW, THESE CONCERNS ALL HAVE TO DO WITH CURRENT CUSTOMERS 

OF QCT, AND THOSE ARE ALL NECESSARILY CURRENT LICENSEES; RIGHT? 

A. YES. 

Q. NOW, QUALCOMM ALSO RECOGNIZED AT THIS TIME A SEPARATE 

CONCERN THAT A SPIN WOULD MAKE IT MORE DIFFICULT TO SIGN NEW 

LICENSE AGREEMENTS WITH COMPANIES THAT WERE NOT CURRENTLY 

LICENSED; IS THAT FAIR? 

A. I THINK -- I THINK IT'S -- I THINK IT'S REASONABLY FAIR, 

YEAH. 

Q. IN FACT, TURN YOUR ATTENTION, SIR --

A. I THINK MOST COMPANIES WERE PROBABLY LICENSED AT THIS 

POINT, BUT -- 

Q. WELL, QUALCOMM RECOGNIZED A CONCERN IT WOULD NOT -- IT 

WOULD BE MORE DIFFICULT TO SIGN 4G LICENSES WITH COMPANIES WHO 

WERE NOT CURRENTLY LICENSED UNDER 4G AT THE TIME THIS DECK WAS 

WRITTEN IN OCTOBER OF 2007; RIGHT? 

A. YEAH. I THINK IF WE WERE JUST STRICTLY -- IF WE HAD SPUN 

AND WE WERE STRICTLY A PATENT COMPANY, AND WE WEREN'T OFFERING, 

YOU KNOW, INNOVATION AND CONTINUED R&D INVESTMENTS AND SO 

FORTH, THEN I THINK IT WOULD HAVE BEEN MORE -- YOU KNOW, YOU 

PROBABLY HAD TO USE THE COURTS, YOU HAD TO GO INTO CHINA TO TRY 

TO ENFORCE RIGHTS THERE. IT WOULD HAVE BEEN MORE DIFFICULT. 

Q. NOW, ANY KIND OF LITIGATION OR USE OF THE COURTS BRINGS 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 46 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

206

SOME RISK; IS THAT A FAIR STATEMENT? 

A. I THINK THAT'S A FAIR STATEMENT, YEAH. 

Q. AND ONE COMPONENT OF THE RISK WOULD BE THAT QUALCOMM MIGHT 

NOT ACHIEVE THE ROYALTIES IT SOUGHT? IS THAT A FAIR STATEMENT? 

A. I THINK THAT'S A FAIR STATEMENT. 

AND I ALSO THINK THAT, HAD WE SPUN, I BELIEVE THAT WE 

COULD HAVE BEEN ABLE TO INCREASE OUR ROYALTY RATE. 

Q. NOW, IT'S BEEN YOUR -- IT'S BEEN TRUE IN YOUR EXPERIENCE 

THAT SOME OEM'S HAVE BEEN PROVIDED WITH A MOTIVATION TO AGREE 

TO THE -- TO QUALCOMM'S LICENSE TERMS IN ORDER TO PURCHASE 

QUALCOMM'S MODEM CHIPSETS; IS THAT RIGHT? 

A. COULD YOU -- I'M SORRY. SAY THAT AGAIN.

Q. IT'S BEEN TRUE IN YOUR EXPERIENCE THAT SOME OEM'S HAVE 

BEEN PROVIDED WITH A MOTIVATION TO AGREE TO QUALCOMM'S LICENSE 

TERMS IN ORDER TO PURCHASE QUALCOMM'S MODEM CHIPSETS? IS THAT 

FAIR? 

A. I THINK IT'S FAIRER TO SAY THAT QUALCOMM PROVIDES ONGOING 

VALUE IN A VARIETY OF DIFFERENT FORMS. THE LATEST, YOU KNOW, 

CHIPS HAVE THE LATEST TECHNOLOGY, BUT THE ONGOING R&D, THE 

IMPROVEMENTS TO THE STANDARDS AND SO FORTH. 

AND SO A LICENSEE GETS ACCESS TO ALL THAT.

Q. AND LICENSEES DESIRE -- STRIKE THAT. 

LET'S TALK ABOUT PEOPLE WHO CURRENTLY ARE NOT LICENSED, 

OKAY, AS OPPOSED TO LICENSEES. 

IT'S A TRUE STATEMENT THAT SOME OEM'S HAVE BEEN PROVIDED 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 47 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

207

WITH A MOTIVATION TO TAKE A LICENSE ON THE TERMS QUALCOMM 

REQUESTED BECAUSE THE OEM WANTED TO LAUNCH A PRODUCT THAT 

INCLUDED A QUALCOMM CHIPSET? IS THAT A FAIR STATEMENT? 

A. A MOTIVATION? THERE ARE OTHER CHIP SUPPLIERS. THEY WOULD 

HAVE TO TAKE A LICENSE EVEN IF THEY USED SOMEBODY ELSE'S CHIP. 

SO I -- 

Q. I MEAN, IS IT A FAIR STATEMENT, SIR, THAT IN YOUR 

EXPERIENCE, SOME OEM'S HAVE BEEN PROVIDED WITH A MOTIVATION TO 

AGREE TO THE LICENSE TERMS QUALCOMM REQUESTED IN ORDER TO 

LAUNCH A PRODUCT BASED ON A QUALCOMM CHIPSET? 

A. NOBODY COMES TO MIND.

Q. TURN YOUR ATTENTION TO THE NEXT TAB, SIR. 

A. I DO THINK THERE'S TECHNOLOGY WE PROVIDE.

Q. CAN YOU TURN YOUR ATTENTION TO THE NEXT TAB IN YOUR 

BINDER, SIR, WHICH IS CX 7886. 

CAN YOU IDENTIFY THIS, SIR, AS AN E-MAIL EXCHANGE BETWEEN 

YOURSELF AND MR. JEFF JACOBS IN OCTOBER OF 2004? 

A. YES. 

MR. MATHESON: YOUR HONOR, MOVE TO ADMIT CX 7886. 

MR. BORNSTEIN: THERE'S NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 7886 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Q. YOUR E-MAIL TO MR. JACOBS STATES, "JING IS EXACTLY RIGHT." 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 48 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

208

THOSE ARE THE FIRST FOUR WORDS; RIGHT? 

A. YES.

Q. AND YOU'RE REFERRING TO THE E-MAIL LOWER DOWN ON THE PAGE 

FROM JING WANG TO EXECUTIVES AT QUALCOMM; IS THAT RIGHT? 

A. I THINK SO. 

Q. NOW, TURNING YOUR ATTENTION TO MR. JING WANG'S E-MAIL, 

THERE'S A SENTENCE HALFWAY DOWN THAT BEGINS, "THE REASON HUAWEI 

SIGNED INTERIM AGREEMENT ON WCDMA IPR WITH QC TWO MONTHS AGO ON 

STANDARD TERMS WAS NOT BECAUSE OF THEIR DESIRE TO COUNTER MII 

POLITICALLY, NOT BECAUSE OF THEIR FEAR OF OUR LAWSUIT, BUT 

BECAUSE OF THEIR HOPE TO QUICKLY DEVELOP UMTS TERMINALS BASED 

ON OUR MSM 6250 IN ORDER TO SELL TO VF," AND OTHERS. 

THE MSM 6250 REFERS TO A QUALCOMM CHIPSET; IS THAT RIGHT? 

A. YES. COULD YOU TELL ME WHERE YOU WERE READING FROM? 

Q. IT'S -- IT SHOULD BE HIGHLIGHTED ON YOUR SCREEN, SIR. 

A. OKAY. THAT'S WHAT I SHOULD BE LOOKING AT.

Q. NOW, IT'S FAIR TO SAY THAT MR. WANG REPORTED TO OTHERS 

THAT HUAWEI'S DESIRE TO LAUNCH A PRODUCT BASED ON AN MSM 6250 

PROVIDED A MOTIVATION TO SIGN A WCDMA LICENSE ON QUALCOMM'S 

STANDARD TERMS? THAT'S FAIR; RIGHT? 

A. THAT'S, THAT'S WHAT IT SEEMS LIKE JING IS SAYING. BUT 

IT'S SOME SORT OF INTERIM AGREEMENT THAT I DON'T REMEMBER.

Q. CAN YOU TURN YOUR ATTENTION TO THE NEXT PAGE OF THE 

DOCUMENT, SIR, CX 7886-002. 

TURNING YOUR ATTENTION TO THE MATERIAL NEAR THE BOTTOM OF 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 49 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

209

THE PAGE, THIS STATES JING WANG WROTE, THERE IS A NUMBER OF 

CARET, TURN YOUR ATTENTION, SIR, TO A STATEMENT. WELL, IT'S 

FAIR TO SAY THAT THIS PORTION OF THE DOCUMENT RELAYS A 

COMMUNICATION FROM THE -- THAT JING WANG HAD WITH HUAWEI; 

RIGHT? 

A. YES. 

Q. AND WHAT HE REPORTS IS, STARTING WITH "IF WE COULD NOT 

RESOLVE THESE ISSUES TIMELY, HUAWEI COULD BE LURED TO USE EMP'S 

UMTS CHIP AND WE COULD LOSE A HUGE LEVERAGE (I.E. MSM 6250 CHIP 

SUPPLY) IN PUSHING HUAWEI TO SIGN THE DEFINITIVE AGREEMENT WITH 

US." 

NOW, EMP UMTS CHIP REFERS TO A COMPETING CHIP OFFERED AT 

THIS TIME; RIGHT? 

A. YES. 

MR. MATHESON: THANK YOU, SIR. I DON'T HAVE ANY MORE 

QUESTIONS AT THIS TIME. I RESERVE FOR REDIRECT, YOUR HONOR. 

THE COURT: ALL RIGHT. TIME IS NOW 10:28. 

MR. BORNSTEIN: WOULD YOUR HONOR LIKE TO PROCEED NOW 

OR TAKE THE MORNING BREAK? 

THE COURT: LET'S GO 5 MINUTES SINCE WE STARTED A 

LITTLE BIT LATE, AND THEN WE'LL TAKE A 15 MINUTE BREAK AFTER 

THAT. 

THANK YOU. 

MR. BORNSTEIN: YOUR HONOR, MAY MR. DEL NIDO 

APPROACH? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 50 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

210

THE COURT: PLEASE, YES. TIME IS 10:29. JEEZ. 

MR. BORNSTEIN: DOES YOUR HONOR HAVE THE BINDER YET? 

THE COURT: YES. THANK YOU. 

CROSS-EXAMINATION

BY MR. BORNSTEIN: 

Q. MR. ALTMAN, GOOD MORNING. 

A. GOOD MORNING. 

Q. LET ME JUST START WITH THE VERY DOCUMENT THAT YOU WERE 

LOOKING AT AT THE END THERE. IT'S TAB 19 IN THE FTC'S BINDER? 

A. IS IT GOING TO SHOW UP HERE ON THE SCREEN, TOO?

Q. I -- 

A. ALL RIGHT. 

Q. WE CAN GET IT ON THE SCREEN. IT'S 7886. CX 7886. 

AND CAN YOU TELL ME WHAT THE DATE OF THIS DOCUMENT IS? 

A. OCTOBER 1, 2004.

Q. WOULD IT BE EASIER IF WE GOT YOU A COPY OF THAT BINDER 

BACK? 

A. IT MIGHT BE. JUST AS LONG AS YOU GO SLOW ENOUGH I CAN 

FIND IT ON HERE. 

Q. OKAY. SO I'M AT TAB 19 OF THE FTC'S BINDER. 

A. TAB 19, OKAY. OKAY. 

Q. AND COUNSEL FOR THE FTC DIRECTED YOU TO THE BOTTOM OF THE 

FIRST PAGE, TO LANGUAGE THAT REFERRED TO "THEIR HOPE TO QUICKLY 

DEVELOP UMTS TERMINALS BASED ON OUR MSM 6250." 

A. YES.

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 51 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

211

Q. DO YOU SEE THAT? 

CAN YOU TELL US WHAT UMTS MEANS? 

A. WCDMA. 

Q. OKAY. AND IN 2004, WHAT POSITION DID QUALCOMM HAVE IN 

TERMS OF WCDMA CHIP SALES? 

A. I'M BAD WITH DATES, BUT I DON'T THINK THAT WE HAD MUCH OF 

A POSITION AT ALL. 

Q. AND IF YOU TURN TO PAGE 2 OF THE DOCUMENT, I'LL DIRECT YOU 

TO SOMETHING ELSE THAT COUNSEL FOR THE FTC POINTED YOU TO DOWN 

NEAR THE BOTTOM WHERE IT READ, "IF WE COULD NOT RESOLVE THESE 

ISSUES TIMELY, HUAWEI COULD BE LURED TO USE EMP'S UMTS CHIP AND 

WE COULD LOSE A HUGE LEVERAGE." 

DO YOU SEE THAT?

A. YES.

Q. AT THIS POINT IN TIME, WAS EMP A COMPETITOR OF QUALCOMM'S 

IN THE SALE OF UMTS CHIPS? 

A. YES.

Q. DID QUALCOMM BELIEVE THAT UMTS WAS A GENUINE THREAT TO WIN 

HUAWEI'S BUSINESS AT THIS POINT IN TIME? 

A. YES.

Q. DID YOU BELIEVE THAT EMP WAS A VIABLE ALTERNATIVE FOR 

HUAWEI FOR A UMTS PRODUCT? 

A. YES. 

Q. LET'S GO BACK JUST A BIT TO THE HISTORY AND THE 

BACKGROUND. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 52 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

212

WHEN DID YOU JOIN THE COMPANY, SIR? 

A. IN OCTOBER OF 1989. 

Q. AND WHAT WAS YOUR ROLE AT THAT TIME? 

A. I WAS MANAGER OF LICENSING AND CONTRACTS AND CORPORATE 

COUNSEL.

Q. AND WHEN DID YOU LEAVE THE COMPANY, SIR?

A. JANUARY 2014. 

Q. WHEN YOU JOINED BACK IN OCTOBER OF 1989, WHAT WAS THE 

COMPANY'S BUSINESS? 

A. WE -- OUR MAIN BUSINESS WAS A PRODUCT CALLED OMNITRACS, 

WHICH WAS A TWO-WAY DATA COMMUNICATION OVER SATELLITE FOR THE 

TRUCKING INDUSTRY. BUT WE HAD JUST ANNOUNCED THAT WE WERE 

WORKING ON CDMA, AND WE WERE ABOUT TO DEMO IT TO SOME 

CHARACTERS.

Q. WAS CDMA AT THAT POINT ADOPTED AS A CELLULAR STANDARD BY 

ANY SDO? 

A. NO. AND THE ENTIRE INDUSTRY WAS GOING IN I BELIEVE THE 

OPPOSITE DIRECTION.

Q. WHAT WAS THE OPPOSITE DIRECTION YOU'RE REFERRING TO?

A. IT WAS -- SO THE INDUSTRY WAS ANALOG AND THEY -- THE U.S. 

INDUSTRY WANTED TO GO DIGITAL, AND THEY DECIDED TO GO WITH 

SOMETHING CALLED TIME DIVISION MULTIPLE ACCESS, WHICH IS 

DIFFERENT FROM CDMA. IT WAS SORT OF SIMILAR TO GSM.

Q. WHEN YOU SAY THE OTHER INDUSTRY WAS GOING IN THE OTHER 

DIRECTION, WHICH COMPANIES ARE YOU REFERRING TO? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 53 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

213

A. BASICALLY EVERYBODY BUT US. 

Q. AND AT THIS POINT IN TIME, WHAT WAS THE STATE OF 

QUALCOMM'S CDMA LICENSING BUSINESS? 

A. THERE WAS NO CDMA LICENSING BUSINESS.

Q. WELL, HOW DID THERE COME TO BE A CDMA LICENSING BUSINESS 

AT QUALCOMM? 

A. WE, WE WERE ABLE TO GAIN SOME INTEREST FROM FIRST ONE 

CELLULAR OPERATOR, WHO THEN GOT TWO OTHER CELLULAR OPERATORS 

INTERESTED. THEY PROVIDED US SOME INITIAL FUNDING. WE DID 

SOME DEMOS FOR THEM AND FOR SOME OTHER PEOPLE IN THE PUBLIC, 

AND THAT GOT THE CARRIERS INTERESTED, AND THEY PROVIDED US SOME 

MORE FUNDING, AND THEN INTRODUCED US TO AT&T AND MOTOROLA.

Q. WHEN YOU SAY THEY INTRODUCED YOU TO AT&T, EXCUSE ME, AND 

MOTOROLA, CAN YOU EXPLAIN WHAT YOU MEAN BY THAT, PLEASE? 

A. WELL, AS THEIR INTEREST IN CDMA GREW, THEY STARTED 

THINKING ABOUT IF, YOU KNOW, AS WE CONTINUED TO PROGRESS, IF 

THEY WANTED TO COMMERCIALLY DEPLOY THIS TECHNOLOGY. THEY 

DIDN'T WANT TO HAVE US BE THE SUPPLIER. THEY WANTED TO HAVE 

MAJOR COMPANIES BY THE SUPPLIER. 

AND MOTOROLA AND AT&T WERE TWO OF THEIR VENDORS FOR THEIR 

INFRASTRUCTURE AND HANDSETS.

Q. AND SO WAS THERE SOME SORT OF ENCOURAGEMENT FOR QUALCOMM 

TO LICENSE THESE COMPANIES? 

A. THEY, THEY ACTUALLY PUT INTO THE -- I REMEMBER THERE WAS, 

I THINK, AN INTERIM FUNDING AGREEMENT, A FURTHER FUNDING 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 54 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

214

AGREEMENT. BUT IN ONE OF THOSE AGREEMENTS, THEY PUT A 

PROVISION THAT REQUIRED US TO LICENSE TO, I THINK, AT LEAST TWO 

OR FOUR COMPANIES OR SOMETHING LIKE THAT.

Q. AND DID QUALCOMM COMPLY WITH THAT PROVISION AND ACTUALLY 

LICENSE THE COMPANIES?

A. YEAH. WE WANTED TO DO THAT AS WELL.

Q. DID YOU PLAY ANY ROLE IN THOSE NEGOTIATIONS? 

A. YEAH, I WAS VERY INVOLVED.

Q. WHAT EXPERIENCE HAD YOU PREVIOUSLY HAD IN NEGOTIATING 

LICENSE AGREEMENTS? 

A. SO I -- I CAME OUT OF LAW SCHOOL AND I WAS -- I SPENT 

THREE YEARS AT A FIRM CALLED GRAY, CARY, AMES & FRYE, AND IT 

LATER BECAME, AFTER MANY MERGERS, DLA PIPER. 

AND IN THAT THREE YEARS, I DID SOME LICENSING, MOSTLY 

TRADEMARK STUFF, AND IT WAS SORT OF ABOUT THE TIME THE STOCK 

MARKET CRASHED, AND THERE WASN'T A TREMENDOUS AMOUNT OF WORK 

GOING ON. 

SO I LEFT AFTER THREE YEARS AND WENT TO QUALCOMM. 

THE COURT: EXCUSE ME. I'M REALLY SORRY TO 

INTERRUPT. LET'S GO AHEAD AND TAKE OUR BREAK NOW IF THAT'S 

OKAY. 

MR. BORNSTEIN: OF COURSE, YOUR HONOR. 

THE COURT: IT'S 10:35. WE'LL TAKE A 15 MINUTE 

BREAK. THANK YOU FOR YOUR PATIENCE AND WE'LL BE BACK IN 15 

MINUTES. THANK YOU. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 55 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

215

(RECESS FROM 10:36 A.M. UNTIL 10:54 A.M.) 

THE COURT: OKAY. WELCOME BACK. PLEASE TAKE A SEAT.

MR. BORNSTEIN: MAY I PROCEED, YOUR HONOR. 

THE COURT: YES, PLEASE. 10:54. GO AHEAD, PLEASE.

BY MR. BORNSTEIN:

Q. MR. ALTMAN, I'M GOING TO BE REFERRING YOU TO SOME THINGS 

IN THE BOOK THAT I GAVE YOU, AND ALSO SOME THINGS IN THE BOOK 

THAT THE FTC GAVE YOU. BUT I'LL START WITH MINE. KEEP THEM 

BOTH IN HAND, PLEASE. 

A. OKAY.

Q. CAN I ASK YOU TO TURN, PLEASE, TO JX 001. 

CAN YOU IDENTIFY THIS DOCUMENT FOR US, PLEASE? 

A. IT'S A CDMA TECHNOLOGY AGREEMENT WITH AT&T.

Q. AND DID YOU HAVE ANY ROLE IN THE NEGOTIATION OF THIS 

AGREEMENT? 

A. YES. 

MR. BORNSTEIN: YOUR HONOR, I MOVE THE ADMISSION OF 

JX 0001. 

THE COURT: ANY OBJECTION? 

MR. MATHESON: NO OBJECTION, YOUR HONOR. 

THE COURT: IT'S ADMITTED. 

(JOINT EXHIBIT JX 0001 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. BORNSTEIN:

Q. WAS THIS THE FIRST CDMA LICENSE AGREEMENT THAT QUALCOMM 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 56 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

216

EXECUTED? 

A. YES. 

Q. AND CAN I ASK YOU TO TURN TO PAGE 019 OF THE AGREEMENT. 

AND YOU SEE THAT UNDER THE HEADING, NUMBER 15, LICENSES OF 

INTELLECTUAL PROPERTY? 

A. YES.

Q. AND CAN YOU IDENTIFY IN THERE THE ROYALTY TERMS ON WHICH 

QUALCOMM AGREED TO LICENSE ITS CDMA TECHNOLOGY TO AT&T? 

A. YES. 

Q. AND THEY WERE WHAT? 

A. 4 PERCENT. 

Q. AND THERE IS A PROVISO THAT FOLLOWS ALONG A LITTLE BIT 

LATER SAYING, "PROVIDED, HOWEVER, AT&T'S RATE HEREUNDER FOR 

CHANNEL UNITS, CDMA ENABLING INFRASTRUCTURE EQUIPMENT AND 

TERMINALS, AS APPLIED SEPARATELY, SHALL NEVER EXCEED 80 PERCENT 

OF THE APPLICABLE FEE RATE, DETERMINED SEPARATELY, CHARGED BY 

QUALCOMM PURSUANT TO," ANOTHER CLAUSE LATER ON DOWN BELOW. 

CAN YOU EXPLAIN WHAT THE MEANING OF THAT PROVISION WAS, 

PLEASE? 

A. AT&T, AND MOTOROLA, BUT UNDER THIS AGREEMENT, AT&T WAS THE 

FIRST LICENSEE AND TOOK A LOT OF RISK ALONG WITH US, AND 

THEY -- AND AS PART OF THAT, WE AGREED THAT THEY WOULD HAVE 

THE -- A FAVORABLE RATE, AT LEAST 20 PERCENT MORE FAVORABLE 

THAN OTHERS.

Q. AND SO THE -- AS A RESULT OF THIS 4 PERCENT RATE AND THE 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 57 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

217

80 PERCENT PROVISO, WHAT RATE DID QUALCOMM EXPECT TO NEGOTIATE 

WITH FUTURE LICENSEES FOR ITS CDMA TECHNOLOGY? 

A. OUTSIDE OF MOTOROLA, WHICH ALSO GOT THIS, 5 PERCENT. 

Q. AND HOW WAS THAT ROYALTY RATE ARRIVED AT WITH AT&T? 

A. IT -- THEY WERE EXTENSIVELY NEGOTIATED. MY RECOLLECTION 

IS WE STARTED HIGHER AND THEY STARTED LOWER, AND WE TALKED 

ABOUT THE VARIOUS VALUE THAT EACH SIDE IS BRINGING. 

Q. AND WHAT WAS THE ROYALTY BASE ON WHICH THE RATE THAT WE 

JUST DISCUSSED WAS CALCULATED? 

A. WELL, THERE'S THREE AREAS. SO THE -- 

Q. LET'S FOCUS ON THE TERMINALS, PLEASE. ARE THE TERMINALS 

THE HANDSETS? 

A. YES.

Q. OKAY. LET'S FOCUS ON THE TERMINALS, PLEASE. 

WHAT WAS THE ROYALTY BASE FOR THE TERMINALS? 

A. IT WAS THE SELLING PRICE, NET SELLING PRICE OF THE 

FINISHED PRODUCT, THE TERMINAL.

Q. AND HOW WAS THAT ROYALTY BASE AGREED UPON BY THE TWO 

COMPANIES? 

A. THAT WASN'T -- I DON'T THINK THAT WAS EVEN REALLY 

EXTENSIVELY NEGOTIATED. THAT'S THE WAY THE INDUSTRY DID IT. 

Q. AND AT THE TIME THIS AGREEMENT WAS NEGOTIATED, WHAT 

LEVERAGE WAS QUALCOMM ABLE TO BRING AGAINST AT&T TO GET THESE 

RATES? 

A. WE REALLY DIDN'T HAVE -- I MEAN, WE -- WE WERE -- WE WOULD 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 58 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

218

STICK OUR CHEST OUT, BUT -- THEY WERE A LARGE COMPANY, AND WE 

WERE VERY SMALL.

Q. WAS QUALCOMM SELLING ANY MODEM CHIPS AT THIS POINT IN 

TIME? 

A. NO. WE WERE STILL TRYING TO VALIDATE THE TECHNOLOGY.

Q. HAD CDMA YET BEEN INCORPORATED INTO ANY ADOPTED CELLULAR 

STANDARD AT THIS POINT IN 1990? 

A. NO.

Q. WERE THERE ANY CDMA NETWORKS DEPLOYED ANYWHERE IN THE 

WORLD AT THIS POINT? 

A. NO.

Q. DO YOU KNOW ABOUT HOW MANY PATENTS QUALCOMM OWNED AT THIS 

POINT? 

A. I -- I DON'T. I WOULD THINK LESS THAN A HUNDRED. 

PROBABLY SIGNIFICANTLY LESS THAN THAT, BUT -- 

Q. CAN I ASK YOU TO TAKE A LOOK AT JX 0002 IN YOUR BINDER, 

PLEASE. AND CAN YOU IDENTIFY THIS DOCUMENT FOR US? 

A. THAT'S THE PATENT LICENSE AGREEMENT BETWEEN QUALCOMM AND 

AT&T. 

Q. AND WERE YOU INVOLVED IN NEGOTIATING THIS AGREEMENT? 

A. YES. 

MR. BORNSTEIN: YOUR HONOR, I MOVE THE ADMISSION OF 

JX 0002. 

THE COURT: ANY OBJECTION? 

MR. MATHESON: NO OBJECTION, YOUR HONOR. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 59 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

219

THE COURT: AND IS THERE ANY SEALING TO ANY OF THESE 

LICENSE AGREEMENTS. 

MR. BORNSTEIN: THERE IS NOT. THANK YOU FOR ASKING, 

YOUR HONOR. 

THE COURT: OKAY. GO AHEAD, PLEASE.

BY MR. BORNSTEIN: 

Q. CAN YOU EXPLAIN, PLEASE -- 

THE COURT: IT'S ADMITTED, YES. 

(JOINT EXHIBIT JX 0002 WAS ADMITTED IN EVIDENCE.)

BY MR. BORNSTEIN: 

Q. CAN YOU EXPLAIN THE RELATIONSHIP BETWEEN THE FIRST AT&T 

AGREEMENT WE JUST DISCUSSED AND THIS SECOND AGREEMENT, JX 0002? 

A. THEY'RE REALLY COMPANION AGREEMENTS. THE FIRST AGREEMENT 

WE TALKED ABOUT COVERS NON-PATENT, OTHER TECHNOLOGY, AND THIS 

AGREEMENT COVERS JUST PATENTS.

Q. SO WHAT DO YOU MEAN BY NON-PATENTS? WHAT OTHER 

TECHNOLOGY -- 

A. SOFTWARE KNOW-HOW, TRADE SECRET, ALL THAT STUFF. 

Q. LET ME ASK YOU TO TURN THEN TO JX 0003 AND ASK THAT YOU 

IDENTIFY THIS AGREEMENT, PLEASE. 

A. THIS IS A PATENT LICENSE AGREEMENT BETWEEN QUALCOMM AND 

MOTOROLA. 

Q. AND THIS IS AN AGREEMENT THAT I BELIEVE IS ALREADY IN 

EVIDENCE AND WAS SHOWN TO YOU BY COUNSEL FOR THE FTC; CORRECT? 

A. I THINK SO, YES. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 60 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

220

Q. OKAY. AND THEN TURN TO JX 0004 AND IDENTIFY THAT ONE FOR 

US, PLEASE. 

A. THAT IS A DS CDMA TECHNOLOGY AGREEMENT BETWEEN QUALCOMM 

AND MOTOROLA.

Q. OKAY. AND WHAT IS THE RELATIONSHIP BETWEEN THOSE TWO 

MOTOROLA AGREEMENTS? 

A. AGAIN, THE CDMA TECHNOLOGY AGREEMENT COVERS EVERYTHING 

OTHER -- IPR OTHER THAN PATENTS, AND THEN THE PATENT LICENSE 

AGREEMENT COVERS PATENTS. 

MR. BORNSTEIN: YOUR HONOR, I'D MOVE THE ADMISSION OF 

JX 0004. 

MR. MATHESON: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(JOINT EXHIBIT JX 0004 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

MR. BORNSTEIN: THANK YOU. 

Q. AND ARE THE GENERAL STRUCTURE OF THE AT&T AND MOTOROLA 

AGREEMENTS THE SAME ACROSS THE TWO? 

A. GENERAL STRUCTURE. THE ONE BIG THING THAT SORT OF JUMPS 

OUT TO ME IS THE WHOLE ROYALTY SHARING CONCEPT.

Q. OKAY. I WILL ASK YOU A FEW QUESTIONS ABOUT THAT. 

BEFORE WE GET TO THE ROYALTY SHARING, WHAT WAS THE ROYALTY 

RATE PAYABLE TO QUALCOMM UNDER THIS AGREEMENT BY MOTOROLA? 

A. 4 PERCENT. 

Q. AND IT ALSO HAD THAT 80 PERCENT PROVISO; IS THAT CORRECT?

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 61 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

221

A. YES.

Q. AND WHAT LEVERAGE WAS QUALCOMM ABLE TO BRING TO BEAR 

AGAINST MOTOROLA TO GET THESE RATES? 

A. WE -- I WOULD HAVE ACTUALLY THOUGHT WE WERE IN A LITTLE 

BETTER POSITION BECAUSE WE HAD SIGNED AT&T, BUT WE NEEDED 

MOTOROLA IN A BIG WAY, AND THAT'S WHY THE WHOLE ROYALTY SHARING 

THING CAME UP.

Q. AND SO THIS, THIS AGREEMENT NOW IS A FEW MONTHS AFTER THE 

AT&T AGREEMENTS. 

WAS QUALCOMM SELLING MODEM CHIPS YET? 

A. NO.

Q. AND WAS THERE ANY CDMA NETWORK DEPLOYED ANYWHERE IN THE 

WORLD AT THIS POINT IN TIME? 

A. NO. 

Q. ON THE SUBJECT OF THE ROYALTY SHARING, IS ROYALTY SHARING 

A FEATURE OF ANY OTHER LICENSE AGREEMENT THAT QUALCOMM SIGNED 

AFTER THIS MOTOROLA AGREEMENT? 

A. NO. 

Q. SO LET ME DIRECT YOU THEN TO A PIECE OF THE MOTOROLA 

AGREEMENT THAT COUNSEL FOR THE FTC IDENTIFIED. 

THIS IS JX 0003. AND THERE IS A DISCUSSION THAT YOU HAD 

WITH COUNSEL FOR THE FTC ABOUT THE LICENSING OF COMPONENTS 

UNDER THAT AGREEMENT. 

DO YOU RECALL THAT? 

A. YES.

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 62 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

222

Q. DO YOU RECALL TO WHOM MOTOROLA WAS LICENSED TO SELL 

COMPONENTS UNDER THIS AGREEMENT? 

A. THEY COULD ONLY SELL TO WHAT I THINK WAS CALLED AUTHORIZED 

PURCHASERS.

Q. AND WHAT ARE THOSE? 

A. LICENSEES, OTHER LICENSEES.

Q. LICENSEES OF QUALCOMM? 

A. OF QUALCOMM. 

Q. WAS THE LICENSE THAT WAS GRANTED UNDER THIS AGREEMENT FOR 

COMPONENTS AN EXHAUSTIVE LICENSE ENABLING SALES TO THIRD 

PARTIES? 

A. NO. NO.

Q. HAS QUALCOMM EVER GRANTED AN EXHAUSTIVE LICENSE FOR 

COMPONENTS FOR THE SALE TO UNAFFILIATED THIRD PARTIES? 

A. NO. NOT SINCE I WAS THERE ANYWAY.

Q. FAIR CLARIFICATION. THANK YOU. 

LET ME DIRECT YOU THEN TO A LITTLE BIT FURTHER IN TIME. 

ABOUT HOW MANY LICENSE AGREEMENTS WOULD YOU SAY QUALCOMM 

HAD NEGOTIATED AND EXECUTED BY 1995? 

A. I'M GOING TO -- 10, 15 PROBABLY.

Q. WELL, LET ME SHOW YOU ONE. IT'S JX 0005. AND I'LL ASK 

THAT YOU IDENTIFY THAT FOR US, PLEASE. 

A. THAT WAS A SUBSCRIBER UNIT LICENSE AGREEMENT WITH NOKIA. 

Q. OKAY. WERE YOU INVOLVED IN NEGOTIATING THIS AGREEMENT?

A. YES. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 63 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

223

MR. BORNSTEIN: YOUR HONOR, I'D MOVE JX 0005 INTO 

EVIDENCE, PLEASE. 

MR. MATHESON: NO OBJECTION, YOUR HONOR. 

THE COURT: IT'S ADMITTED. 

(JOINT EXHIBIT JX 0005 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. BORNSTEIN:

Q. AND NOW LET'S LOOK AT THE CLAUSE OF THIS AGREEMENT IN 

WHICH THE LICENSE IS GRANTED. IT'S ON PAGE 011, SECTION 5.1. 

A. OKAY. 

Q. DO YOU SEE THAT THIS AGREEMENT HAS A LICENSE THAT RELATES 

TO COMPONENTS IN LITTLE 2, ROMAN II? 

A. YES. 

Q. AND DID THIS AGREEMENT AUTHORIZE NOKIA TO SELL COMPONENTS 

TO THIRD PARTIES? 

A. NO. 

Q. DID QUALCOMM HAVE A COMPONENT MODEM CHIP BUSINESS AT THIS 

POINT IN TIME? IN 1992? 

A. IN '92? I DON'T -- I DON'T THINK SO. I DON'T THINK THE 

STANDARD CAME UNTIL LATER. 

Q. WHAT -- WAS THE INTENT OF THIS PROVISION TO LIMIT OTHER 

CHIP SUPPLIERS' ABILITY TO SELL MODEM CHIPS? 

MR. MATHESON: OBJECTION, YOUR HONOR. LEADING. 

THE WITNESS: THEY COULD MAKE THEIR OWN CHIP. 

THE COURT: EXCUSE ME. WAIT ONE MINUTE, PLEASE. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 64 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

224

SUSTAINED. THE QUESTION IS STRICKEN. 

BY MR. BORNSTEIN:

Q. TAKE A LOOK, SIR, AT SECTION 5.2, WHICH BEGINS ON THE SAME 

PAGE. 

WHAT ARE THE -- DO YOU SEE THERE'S A, AT THE TOP OF PAGE 

012, THERE'S A LIST OF ROYALTY PERCENTAGES. 

A. YES. 

Q. OKAY. CAN YOU EXPLAIN WHAT THE ROYALTY RATES WERE THAT 

NOKIA AGREED TO IN THIS 1992 AGREEMENT FOR HANDSETS? 

A. YEAH. IT WAS A, SORT OF A STAGGERED ROYALTY RATE BASED ON 

VOLUME. STARTING AT 6 AND A HALF PERCENT. AND THEN IF THEY 

SOLD MORE THAN A HUNDRED THOUSAND UNITS IN A QUARTER, THEN ALL 

THE UNITS WOULD BE AT A 5 PERCENT RATE.

Q. OKAY. AND HOW WAS THIS ROYALTY RATE ARRIVED AT WITH 

NOKIA? 

A. THROUGH EXTENSIVE NEGOTIATIONS WITH NOKIA.

Q. DID QUALCOMM HAVE ANY LEVERAGE OVER NOKIA AT THIS POINT IN 

TERMS OF THE SUPPLY OF COMPONENTS? 

A. NO. 

Q. LET ME DIRECT YOU TO JUST A COUPLE OF OTHER AGREEMENTS 

EXECUTED IN THE SAME TIMEFRAME. TAKE A LOOK AT JX 0006, 

PLEASE. I APOLOGIZE. I'M GOING TO DIRECT YOU TO QX 9278, 

WHICH IS FURTHER TO THE BACK OF YOUR BINDER. 

A. OKAY.

Q. CAN YOU IDENTIFY THAT DOCUMENT FOR US, PLEASE. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 65 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

225

A. YEAH. IT'S A SUBSCRIBER UNIT LICENSE AGREEMENT BETWEEN 

QUALCOMM AND OKI ELECTRIC.

Q. AND WERE YOU INVOLVED IN THE NEGOTIATION OF THIS 

AGREEMENT? 

A. YES. 

MR. BORNSTEIN: YOUR HONOR I'D MOVE QX 9278 INTO 

EVIDENCE. 

MR. MATHESON: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(DEFENDANT'S EXHIBIT QX 9278 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE.

BY MR. BORNSTEIN: 

Q. TAKE A LOOK, SIR, ALSO AT QX 9262, WHICH IS THE PRIOR 

DOCUMENT IN YOUR BINDER, AND IDENTIFY THAT FOR US? 

A. CDMA TECHNOLOGY LICENSE AGREEMENT BETWEEN ALPS ELECTRIC 

AND -- AND BOTH A U.S. AND A JAPANESE CORPORATION, TWO 

DIFFERENT COMPANIES, AND ALPINE. 

Q. IS THIS AN AGREEMENT THAT YOU WERE INVOLVED IN 

NEGOTIATING? 

A. YES. 

MR. BORNSTEIN: YOUR HONOR, I'D MOVE QX 9262 INTO 

EVIDENCE AS WELL. 

THE COURT: IT'S ADMITTED. 

(DEFENDANT'S EXHIBIT QX 9262 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 66 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

226

BY MR. BORNSTEIN:

Q. IN 1993, WERE YOU INVOLVED IN THE NEGOTIATION OF ANY 

AGREEMENTS WITH KOREAN MANUFACTURERS? 

A. YES. 

Q. AND DO YOU RECALL HOW THOSE NEGOTIATIONS CAME TO START? 

A. WE SIGNED A JOINT DEVELOPMENT AGREEMENT WITH AN 

ORGANIZATION CALLED ETRI, WHICH WAS THE KOREAN GOVERNMENT'S 

SORT OF R&D ARM. I THINK IT WAS ELECTRONICS TELECOMMUNICATIONS 

RESEARCH INSTITUTE. 

AND THEY WERE VERY INTERESTED IN CDMA AND THEY FUNDED -- 

IT WAS PROBABLY AT THAT POINT ONE OF OUR BIGGEST CONTRACTS, $17 

MILLION -- I BELIEVE IT WAS $17 MILLION, A JOINT DEVELOPMENT 

AGREEMENT. 

AND AS PART OF THAT, THEY HAD THE RIGHT TO DESIGNATE I 

THINK FOUR, WE CALLED THEM DESIGNATED MANUFACTURERS, DM'S, AND 

THEY DESIGNATED SAMSUNG, HYUNDAI, LG, AND I THINK MAXON, 

M-A-X-O-N. 

Q. AND ETRI DESIGNATED THESE MANUFACTURERS FOR WHAT PURPOSE? 

A. TO BE ABLE TO GET COMMERCIAL LICENSES SO THAT THEY, YOU 

KNOW, ONCE THE TECHNOLOGY WAS FULLY COMMERCIALIZED, THEY COULD 

SELL. 

Q. COMMERCIAL LICENSES FOR WHAT TYPE OF PRODUCT? 

A. I THINK SAMSUNG -- SAMSUNG AND LG, I THINK, AND MAYBE 

HYUNDAI, HAD BOTH INFRASTRUCTURE AND SUBSCRIBER UNIT, AND I 

THINK MAXON WAS JUST SUBSCRIBER UNIT.

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 67 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

227

Q. DID ETRI DESIGNATE ANY MANUFACTURERS FOR A LICENSE TO 

COMPONENTS? 

A. NO.

Q. AND WHAT ROLE DID THE KOREAN GOVERNMENT PLAY IN 

ESTABLISHING THE TERMS OF THE AGREEMENTS WITH THE DESIGNATED 

MANUFACTURERS? 

A. I THINK WE, IN THE JOINT DEVELOPMENT AGREEMENT, AS PART OF 

OUR COMMITMENT TO LICENSE MANUFACTURERS THEY DESIGNATED, WE -- 

THERE WERE SOME PROVISIONS IN THERE RELATIVE TO THE, SORT OF 

SOME OF THE MATERIAL TERMS THAT WE WOULD INCLUDE IN THOSE 

AGREEMENTS.

Q. DO YOU RECALL GENERALLY WHAT TYPE OF TERMS YOU HAD IN 

MIND? 

A. I THINK THERE WERE ROYALTY RATES; I THINK UPFRONT FEES; 

MAYBE SOME DELIVERABLES. 

Q. I'D ASK YOU TO LOOK AT JX 0006, PLEASE. IT SHOULD BE JUST 

BEFORE THE AGREEMENT YOU HAD BEEN LOOKING AT. 

A. OKAY.

Q. AND CAN YOU IDENTIFY THIS DOCUMENT FOR US? 

A. THIS IS AN INFRASTRUCTURE AND SUBSCRIBER UNIT LICENSE 

BETWEEN SAMSUNG AND QUALCOMM.

Q. AND IS THIS ONE OF THE AGREEMENTS THAT AROSE FROM THIS 

DESIGNATED MANUFACTURER PROCESS? 

A. YEAH. YOU CAN SEE IN THE SECOND WHEREAS CLAUSE, IT SAYS 

THAT THEY'VE BEEN SELECTED BY ETRI TO OBTAIN A LICENSE. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 68 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

228

Q. THANK YOU. 

YOUR HONOR, I'D MOVE JX 0006 INTO EVIDENCE. 

MR. MATHESON: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(JOINT EXHIBIT JX 0006 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. BORNSTEIN:

Q. AND I'M GOING TO ASK YOU A FEW QUESTIONS ABOUT PROVISIONS 

OF THIS AGREEMENT THAT RELATE TO ROYALTIES WHICH THE COURT HAS 

ORDERED SEALED ALREADY PURSUANT TO A MOTION FROM SAMSUNG, AND 

SO I'D ASK THAT -- 

THE COURT: ONLY -- 

MR. BORNSTEIN: YES. 

Q. WHEN WE DISCUSS THE ROYALTY TERMS, SIR, I'LL ASK YOU NOT 

TO SAY ANY OF THE FINANCIAL TERMS OUT LOUD, AND I'LL TRY AND 

PHRASE MY QUESTIONS APPROPRIATELY AS WELL. 

A. OKAY.

Q. SO IF YOU COULD TURN TO PAGE 012 OF THE EXHIBIT, PLEASE. 

A. OKAY. 

Q. DO YOU SEE PROVISION 5.2.1? 

A. YES.

Q. AND DOES THIS PROVISION REFLECT THE ROYALTY TERMS THAT 

SAMSUNG AGREED TO PAY QUALCOMM FOR HANDSETS? 

A. YES. 

Q. AND WERE THESE THE ROYALTY TERMS THAT WERE ESTABLISHED 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 69 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

229

THROUGH COMMUNICATION WITH THE KOREAN GOVERNMENT? 

A. I BELIEVE SO. 

Q. OKAY. WERE THE TERMS OF THE AGREEMENTS WITH THE OTHER 

DESIGNATED MANUFACTURERS THE SAME AS THE AGREEMENT WITH 

SAMSUNG?

A. I BELIEVE SO, YES.

Q. AND AT THE TIME THAT THESE AGREEMENTS WERE SIGNED, WAS 

QUALCOMM SELLING CDMA MODEM CHIPS? 

A. I DON'T BELIEVE SO. 

Q. WHAT LEVERAGE DID QUALCOMM HAVE OVER THE DESIGNATED 

MANUFACTURERS IN NEGOTIATING THESE AGREEMENTS? 

A. I MEAN, IT -- AGAIN, WE WERE THE PIONEERS OF CDMA. THEY 

WERE INTERESTED IN CDMA. BUT, YOU KNOW, WHEN YOU -- IF YOU 

THINK ABOUT IT IN TERMS OF RELATIVE SIZE AND SO FORTH, I MEAN, 

THAT $17 MILLION WE GOT FROM ETRI FUNDED A VERY BIG CHUNK OF 

OUR PAYROLL. 

Q. I WANT TO ASK YOU QUESTIONS ABOUT LG. I THINK YOU SAID 

THEY WERE ONE OF THE DESIGNATED MANUFACTURERS AS WELL. 

A. YES. 

Q. WAS THERE A DISPUTE THAT TOOK PLACE LATER ON AS TO THE 

SCOPE OF LG'S LICENSE AND WHAT PRODUCTS IT COVERED? 

A. YES, I THINK SO. 

Q. OKAY. CAN YOU TELL ME WHAT YOU REMEMBER THE NATURE OF THE 

DISPUTE TO HAVE BEEN, IF YOU DO? 

A. I BELIEVE THAT THEY -- IF I'M THINKING OF THE RIGHT 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 70 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

230

TIMEFRAME, THEY LATER CLAIMED THAT WCDMA WASN'T COVERED, I 

THINK, UNDER THEIR EXISTING AGREEMENT.

Q. AND WAS THAT A DISPUTE THAT WAS EASILY RESOLVED BETWEEN 

QUALCOMM AND LG? 

A. EASILY RESOLVED? I MEAN, IT -- I GUESS IT DEPENDS IF 

YOU'RE SITTING IN THE ROOM HAVING TO NEGOTIATE AND ADDRESS THE 

ISSUES.

Q. WAS THERE ANY -- APOLOGIES. 

WAS THERE ANY KIND OF DISPUTE RESOLUTION PROCEEDING THAT 

WAS INITIATED, LITIGATION OR ARBITRATION? 

A. I THINK -- I THINK WE FILED -- MY RECOLLECTION IS WE FILED 

AN ARBITRATION, BUT I THINK WE SETTLED. WE HAD -- WITH MANY 

LICENSEES, YOU KNOW, THEY WOULD RAISE ISSUES, AND WE WOULD TRY 

TO WORK TO ADDRESS THEM, AND LG WAS ONE OF THEM. 

Q. WERE THERE ANY COMMUNICATIONS THAT WERE MADE AT THE TIME 

THIS ARBITRATION BEGAN ABOUT CHIP SUPPLY TO LG? 

A. I DON'T THINK SO. 

MR. BORNSTEIN: YOUR HONOR, I'D LIKE TO APPROACH -- 

THE WITNESS: OH, I'M SORRY, AT THE TIME OF THE 

ARBITRATION. 

BY MR. BORNSTEIN:

Q. AT THE TIME OF THE ARBITRATION, YES. 

A. THERE MIGHT HAVE BEEN.

Q. DO YOU REMEMBER, ONE WAY OR THE OTHER, WHETHER YOU 

COMMITTED ANYTHING ABOUT CHIP SUPPLY TO LG AT THE TIME OF THE 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 71 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

231

ARBITRATION? 

A. I THINK -- I THINK WE TRIED -- THEY WERE AN IMPORTANT 

CUSTOMER, AND I THINK WE TRIED TO -- YOU KNOW, WE HAD AN ISSUE 

WE WEREN'T MAKING PROGRESS ON. I THINK WE FILED FOR 

ARBITRATION. 

BUT I THINK WE ASSURED THEM THAT, YOU KNOW, WE WOULD 

CONTINUE TO SUPPLY. 

Q. AND HOW WAS THAT ASSURANCE MADE? DO YOU KNOW? 

A. ONE OF THE EXECUTIVES PROBABLY. IT MIGHT HAVE BEEN ME OR 

IRWIN OR SOMEBODY PROBABLY. 

Q. OKAY. OKAY. 

YOUR HONOR, I'D LIKE TO APPROACH THE WITNESS IF I CAN TO 

TRY TO REFRESH HIS RECOLLECTION. 

THE COURT: PLEASE, GO AHEAD. 

MR. BORNSTEIN: THANK YOU. 

WOULD YOUR HONOR LIKE ONE, OR NO? 

THE COURT: YES, PLEASE. THANK YOU. 

MR. BORNSTEIN: (HANDING.) 

Q. MR. ALTMAN, IF I COULD ASK YOU TO JUST READ TO YOURSELF 

THE FIRST PAGE OF THE DOCUMENT, AND REALLY JUST THE "TO" AND 

THE "FROM" ON THE E-MAIL, AND THE BOTTOM BIG PARAGRAPH THERE 

NEAR THE END. THERE'S A SENTENCE THAT BEGINS WITH THE WORDS 

"WE DO NOT INTEND." 

JUST READ THAT TO YOURSELF, PLEASE. 

(PAUSE IN PROCEEDINGS.) 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 72 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

232

THE WITNESS: OKAY. 

BY MR. BORNSTEIN:

Q. OKAY. DOES THIS REFRESH YOUR RECOLLECTION IN ANY WAY 

ABOUT COMMUNICATIONS THAT WERE MADE BY QUALCOMM TO LG AT THE 

TIME THIS ARBITRATION BEGAN RELATING TO CHIP SUPPLY? 

A. YEAH. 

Q. OKAY. TELL ME WHAT YOU RECALL, PLEASE. 

A. THAT WE FELT LIKE WE COULD TRY TO RESOLVE THE WCDMA ISSUE 

THROUGH ARBITRATION BUT WANTED TO MAKE SURE THAT THEY 

UNDERSTOOD THAT WE DIDN'T WANT THIS TO AFFECT THE -- I MEAN, IT 

WAS JUST -- SOMETIMES YOU JUST CAN'T REACH AN AGREEMENT; RIGHT? 

SO WE WANTED TO TRY TO REACH THE AGREEMENT THROUGH A THIRD 

PARTY MAKING THE DECISION, BUT CONTINUE THE, THE GOOD 

RELATIONSHIPS WE HAD WITH THEM IN TERMS OF CDMA 2000. 

Q. LET ME ASK YOU TO TURN, SIR, BACK TO THE BINDER THAT THE 

FTC PROVIDED YOU. AND I'LL DIRECT YOU TO TAB 7 OF THE BINDER. 

THIS IS CX 6729 WHICH THE COURT ADMITTED INTO EVIDENCE. 

DO YOU REMEMBER BEING QUESTIONED ON THIS DOCUMENT WHICH 

RELATES TO COMMUNICATIONS WITH SAMSUNG IN 2001. 

A. YES.

Q. OKAY. AT THE TIME OF THIS COMMUNICATION, WAS SAMSUNG 

PAYING ITS ROYALTIES THAT WERE REQUIRED UNDER THE AGREEMENT 

WITH QUALCOMM? 

A. NO. 

Q. IF SAMSUNG HAD CONTINUED TO PAY, BUT RAISED THE QUESTION 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 73 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

233

AS TO THE SCOPE OF ITS AGREEMENT, WOULD QUALCOMM HAVE CONTINUED 

TO SHIP CHIPS? 

A. ABSOLUTELY. 

Q. ARE THERE STEPS THAT QUALCOMM HAS TYPICALLY TAKEN WHEN A 

CUSTOMER OR LICENSEE STOPS PAYING TO AVOID THE CESSATION OF 

CHIP SUPPLY? 

A. I MEAN, WE -- WE COMMUNICATE WITH THEM AND TRY TO 

DETERMINE WHAT THE ISSUE IS, WHY IT'S AN ISSUE, NEGOTIATE, TAKE 

IT UP MANY LEVELS. I MEAN, IT'S -- IT'S VERY -- IT'S ALWAYS 

BEEN VERY IMPORTANT TO US TO TRY TO MAINTAIN VERY STRONG 

RELATIONSHIPS WITH OUR LICENSEES. 

Q. ARE THERE ANY WAYS IN WHICH TERMINATING CHIP SUPPLY 

PRESENTS RISK TO QUALCOMM? 

A. A TON OF WAYS, YEAH. 

Q. CAN YOU EXPLAIN WHAT THEY ARE? 

A. NOT ONLY WOULD DOING SO IMPACT THE VIEWS AND ATTITUDES OF 

OUR OTHER CHIP CUSTOMERS, BUT ALSO VERY IMPORTANTLY, IT WOULD 

IMPACT THE VIEWS OF OUR CARRIERS, YOU KNOW, THE CARRIERS THAT 

WE DEPLOY TO. 

SO IF YOU THINK BACK TO THE FUNDING AGREEMENT THAT I 

TALKED ABOUT EARLIER WITH -- THAT WAS WITH PAC TEL AND NYNEX 

TECH, WHO BECAME VERIZON, IF THEY WERE DEPENDING -- IF CARRIERS 

ARE DEPENDING ON A CERTAIN HANDSET THAT USES OUR CHIPS AND WE 

HAVE TO STOP SHIPPING BECAUSE THE LICENSEE IS NOT HONORING THE 

AGREEMENT, IT HAS REPERCUSSIONS TO THOSE COMPANIES AS WELL. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 74 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

234

AND THOSE COMPANIES MAKE DECISIONS ALL THE TIME ABOUT THE 

NEXT TECHNOLOGY THAT THEY'RE GOING TO DEPLOY. SO WITH SOMEBODY 

LIKE VERIZON, THEY DEPLOY CDMA, YOU KNOW, IS 95, OR CDMA 1. WE 

WANT THEM TO GO WITH CDMA 2000, YOU KNOW, THEY'RE GOING TO MAKE 

DECISIONS ON THIRD GENERATION, ON FOURTH GENERATION, ON FIFTH 

GENERATION. 

SO IT'S VERY IMPORTANT THAT WE MAINTAIN VERY STRONG 

RELATIONSHIPS.

Q. LET ME ASK YOU TO LOOK, SIR, AT ANOTHER DOCUMENT IN THE 

FTC'S BINDER. THIS IS TAB 11, CX 7141, WHICH HAS BEEN ADMITTED 

INTO EVIDENCE. 

DO YOU RECALL BEING ASKED QUESTIONS ABOUT THIS 

COMMUNICATION REGARDING NOKIA -- 

A. YES.

Q. -- IN 2005? 2004, I APOLOGIZE. 

AT THIS POINT IN TIME WAS NOKIA A QUALCOMM LICENSEE? 

A. YES. 

Q. AND WAS QUALCOMM -- EXCUSE ME. 

WAS NOKIA ELIGIBLE TO PURCHASE CHIPS FROM QUALCOMM AT THIS 

POINT IN TIME? 

A. YES.

Q. WAS NOKIA, IN 2004, A QUALCOMM CHIP CUSTOMER? 

A. I DON'T BELIEVE SO. 

Q. DO YOU KNOW WHOSE CHIPS THEY WERE USING? 

A. I -- I -- I'M NOT EVEN SURE WHETHER THEY WERE SELLING CDMA 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 75 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

235

BACK THEN.

Q. OKAY. WERE THEY A LARGE CUSTOMER OR SMALL -- EXCUSE ME. 

A LARGE OEM OR A SMALL OEM?

A. THEY WERE A VERY LARGE OEM.

Q. OKAY. AND I BELIEVE YOU SAID IN RESPONSE TO A QUESTION 

FROM THE FTC'S COUNSEL THAT THERE WAS A RENEWAL OPTION OF 

THIS -- FOR THIS AGREEMENT; IS THAT CORRECT? 

A. YES. 

Q. AND WAS THAT A UNILATERAL RENEWED OPTION, OR DID THEY 

REQUIRE QUALCOMM'S CONSENT TO RENEW? 

A. IT WAS -- MY RECOLLECTION IT WAS THEIR UNILATERAL OPTION.

Q. DID THEY EXERCISE THAT OPTION? 

A. I THINK THEY LET IT LAPSE. 

Q. AND WHAT HAPPENED THEN? 

A. I MEAN, WE ENDED UP IN LITIGATION WITH THEM AND IT SETTLED 

BEFORE IT ACTUALLY -- 

Q. LET ME DIRECT YOU THEN TO TAB 14 IN THE BINDER. THIS IS 

CX 7799. 

THIS IS IN EVIDENCE, YOUR HONOR. 

DO YOU RECALL BEING ASKED QUESTIONS ABOUT THIS 

COMMUNICATION YOU HAD WITH MOTOROLA IN 2000? 

A. YES. 

Q. AT THE -- AT THE TIME OF THIS E-MAIL, WHAT WAS MOTOROLA'S 

GENERAL PRACTICE AS TO WHETHER OR NOT IT LICENSED EXHAUSTIVELY 

AT THE COMPONENT LEVEL? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 76 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

236

A. IT DIDN'T. IT DIDN'T LICENSE EXHAUSTIVELY AT THE 

COMPONENT LEVEL.

Q. AND WHAT HAD MOTOROLA SAID, IF ANYTHING, ABOUT WHETHER 

QUALCOMM NEEDED TO HAVE A GSM LICENSE FOR QUALCOMM'S CHIPS? 

A. WE HAD A, I WOULD SAY, A ROCKY RELATIONSHIP WITH MOTOROLA. 

THEY HAD, THEY CAME OUT, I BELIEVE, AND SAID -- AND IT SAYS 

HERE THEY CONTACTED THE STOCK ANALYSTS. 

THEY BASICALLY PUBLICLY SAID THAT WE WOULDN'T BE ABLE TO 

PROCEED WITH MULTI MODE GSM CDMA BECAUSE THEY HAD PATENTS AND 

WE WEREN'T -- THEY WEREN'T GOING TO LICENSE THEM TO US.

Q. AND PRIOR TO THAT STATEMENT BY MOTOROLA, HAD QUALCOMM 

SOUGHT A GSM LICENSE FROM MOTOROLA? 

A. WE HAD. I THINK WE HAD SOME RIGHTS UNDER THE PREEXISTING 

AGREEMENT. BUT WE DIDN'T HAVE -- IF WE DID, IF I'M RECALLING 

IT CORRECTLY, WE DIDN'T HAVE ALL OF THEM. AND WE DIDN'T SEEK 

IT.

Q. WHY DID YOU NOT SEEK ADDITIONAL RIGHTS PRIOR TO THIS 

STATEMENT? 

A. I BELIEVE IT'S BECAUSE THEY DIDN'T -- THEY DON'T LICENSE 

FOR ASICS. THEY DEAL -- THEY LICENSE DIRECTLY TO THE DEVICE 

MANUFACTURERS, AND WE COULD SELL OUR CHIPS TO THE DEVICE 

MANUFACTURERS AND THEY WOULD THEN ENTER INTO WHATEVER 

AGREEMENTS THEY HAD TO ENTER INTO WITH MOTOROLA.

Q. AND SO WHY, AFTER MOTOROLA MADE THIS STATEMENT ABOUT 

QUALCOMM'S PARTICIPATION IN GSM SALES, DID QUALCOMM NOW CHANGE 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 77 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

237

ITS MIND AND SEEK SOME SORT OF AGREEMENT? 

A. BECAUSE MOTOROLA, IF I RECALL THIS CORRECTLY, MADE A 

PUBLIC STATEMENT THAT THEY WERE GOING TO PRECLUDE US FROM 

SELLING MULTI MODE CHIPS. 

Q. LET ME ASK YOU TO TURN TO TAB 15, WHICH IS CX 8177. 

IT'S ALREADY IN EVIDENCE, YOUR HONOR. 

A. I'M SORRY, I'M ON TAB 15 -- OH, NO. 

15, OKAY. 

Q. DO YOU RECALL BEING ASKED A FEW QUESTIONS ABOUT THIS 

DOCUMENT AS WELL? 

A. YES.

Q. AND YOU WERE DIRECTED TO THE BOTTOM OF THE FIRST PAGE, 

001, WHERE YOU WROTE THAT THEY HAVE, "THEY" BEING INTEL; 

CORRECT? 

A. YES.

Q. OKAY. "THEY HAVE POINTED OUT TO US THAT WE MADE A 

COMMITMENT IN A 1994 AGREEMENT THAT WE WOULD LICENSE THEM ON 

TERMS TO BE NEGOTIATED. THAT COMBINED WITH OUR COMMITMENT TO 

THE INDUSTRY TO LICENSE ON FAIR AND REASONABLE TERMS, FREE FROM 

UNFAIR DISCRIMINATION, WOULD MAKE IT DIFFICULT TO ARGUE THAT WE 

HAVE THE RIGHT TO REFUSE TO LICENSE THEM."

DO YOU SEE THAT? 

A. YES. 

Q. AT THIS POINT IN TIME, DID YOU UNDERSTAND QUALCOMM TO BE 

REQUIRED, BY ITS FRAND COMMITMENT, TO GRANT A LICENSE TO A CHIP 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 78 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

238

MAKER THAT WAS EXHAUSTIVE? 

A. NO. 

Q. OKAY. HAS QUALCOMM EVER GRANTED A LICENSE TO A CHIP MAKER 

THAT WAS EXHAUSTIVE? 

A. NO. 

Q. WHAT COMPANY -- 

A. NOT DURING THE TIME I WAS THERE.

Q. THANK YOU. 

AND WHAT KIND OF AGREEMENT WERE YOU ACTUALLY TALKING ABOUT 

HERE IN THIS EXHIBIT? 

A. I -- I'M SURE IT WAS A NON-EXHAUSTIVE AGREEMENT. 

Q. THERE WERE A FEW QUESTIONS THAT YOU WERE ASKED BY THE 

FTC'S COUNSEL ABOUT THE POSSIBILITY OF SPLITTING THE COMPANY 

INTO TWO PIECES. 

DO YOU REMEMBER THOSE? 

A. YES.

Q. SOMETHING RELATED TO PROJECT BERLIN? 

A. YES. 

Q. IF IT WERE YOUR DECISION, SIR, YOU AND YOU ALONE BACK AT 

THE TIME OF BERLIN, WOULD YOU HAVE DECIDED TO SPLIT THE COMPANY 

IN TWO? 

A. I WOULD HAVE SPLIT THE COMPANY IN TWO BACK IN 2000 WHEN WE 

FIRST LOOKED AT IT, AND I WOULD HAVE DONE IT AGAIN IN 2008. 

I -- THE COMPANY KNOWS THAT I HAVE ALWAYS BEEN AN ADVOCATE OF 

DOING THAT.

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 79 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

239

Q. OKAY. CAN YOU EXPLAIN YOUR RATIONALE FOR WHY YOU ARE AN 

ADVOCATE OF SPLITTING -- OR HAD BEEN AN ADVOCATE OF SPLITTING 

THE COMPANY? 

A. BECAUSE I WAS OF THE BELIEF THAT THE TWO BUSINESSES WOULD 

PERFORM OPTIMALLY INDEPENDENTLY. 

FROM THE CHIP POINT OF VIEW, I FELT THAT -- I MEAN, 

THERE'S NO DOUBT, A COMPANY -- LICENSEES, EVEN THOSE -- EVEN 

THE ONES THAT RESPECT OUR INTELLECTUAL PROPERTY, PREFER NOT TO 

PAY ROYALTIES AND WOULD LOOK FOR WAYS NOT TO PAY ROYALTIES. 

ON THE CHIP SIDE, THEY, LICENSEES, WOULD COME TO THE CHIP 

BUSINESS AND SAY, YOU KNOW, WE'RE PAYING ALL THESE ROYALTIES, 

WE WANT YOU TO REDUCE OUR CHIP PRICES OR WE'RE NOT GOING TO USE 

YOUR CHIP, WE'RE GOING TO USE SOMEBODY'S ELSE CHIPS, THOSE 

KINDS OF THINGS. 

OR THEY WOULD SAY WE'RE GOING TO ASSERT PATENTS AGAINST 

YOUR CHIP PRODUCTS. 

ALL THOSE SORTS OF THINGS CAUSED PRESSURE ON BOTH 

BUSINESSES TO MAKE COMPROMISES, TO REDUCE ROYALTIES, TO REDUCE, 

YOU KNOW, CHIP PRICING, TO DO THOSE -- TO PROVIDE INCENTIVE 

AGREEMENTS, DO THOSE KINDS OF THINGS, THAT I THINK AS SEPARATE 

COMPANIES WE WOULDN'T HAVE TO DO. 

AND A LICENSING COMPANY, EVEN THOUGH EARLIER I TALKED 

ABOUT A PATENT LICENSING COMPANY WOULD HAVE TO -- YOU KNOW, 

THERE WOULD BE SOME ISSUES IN TERMS OF HAVING TO GO ENFORCE AND 

SO FORTH, IT WOULDN'T NEED A CROSS-LICENSE TO ITS PRODUCTS 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 80 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

240

BECAUSE IT WOULDN'T BE SELLING PRODUCTS. IT HAD -- IN MY VIEW, 

WE HAD A VERY BROAD PATENT PORTFOLIO THAT HAD BEEN LICENSED 

TIME AND TIME AGAIN AND SO THERE WAS A, A VERY CLEAR VALUE FOR 

THAT PORTFOLIO. 

AND WHEN, WHEN YOU TAKE OUT THE NEED FOR CROSS-LICENSES, 

WHEN YOU TAKE OUT THE, YOU KNOW, THE OTHER ISSUES THAT YOU GET 

FACED WITH AS ONE COMPANY, I BELIEVED THAT WE COULD POTENTIALLY 

GET MORE ROYALTY INCOME FOR INNOVATION THAT WE CONTINUED TO 

PRODUCE. 

Q. OKAY. CAN I ASK YOU TO TAKE A LOOK AT ONE MORE DOCUMENT, 

IT'S IN THE FTC'S BINDER. IT'S TAB 20, CX 7035. 

AND, YOUR HONOR, THIS WAS ADMITTED INTO EVIDENCE ON 

FRIDAY. 

IS THIS AN E-MAIL, SIR, THAT YOU WROTE IN 2008 TO 

PAUL JACOBS?

A. YES. 

Q. AND WHAT'S THE GENERAL SUBJECT MATTER OF THIS E-MAIL? 

A. THE GENERAL SUBJECT MATTER IS PUTTING FORTH A RATIONALE 

FOR NOT SPINNING. 

Q. OKAY. AND IN THE VERY FIRST -- THE VERY FIRST LINE OF THE 

E-MAIL YOU SAY, "HERE IS THE WAY ONE COULD VIEW THE CHINA 

SITUATION AS HAVING CAUSED A CHANGE IN OUR THINKING." 

DO YOU SEE THAT? 

A. YES.

Q. COULD YOU EXPLAIN WHAT YOU MEANT BY THAT AND WHAT YOU WERE 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 81 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

241

DOING HERE? 

A. MY RECOLLECTION IS THAT PAUL, WHO WAS -- I MEAN, THIS WAS 

A TOUGH DECISION. THERE WERE -- THERE'S PRO'S AND CON'S FOR 

SPINNING FOR SURE. 

HE HAD BEEN IN FAVOR OF IT, AND THEN HAD DECIDED THAT HE 

DIDN'T WANT TO GO FORWARD WITH IT. 

SO -- 

Q. "IT" BEING THE SPIN, YOU MEAN? 

A. YEAH. AND THIS SETS FORTH SOMETHING THAT HAD HAPPENED 

THAT GIVES US A RATIONALE FOR, ANOTHER REASON, ANOTHER PRO, I 

GUESS, FOR NOT SPINNING. 

Q. AND AT THE TIME YOU WROTE THIS WERE YOU STILL AN ADVOCATE, 

HOWEVER, OF KEEPING -- FOR SPLITTING THE COMPANY APART? 

A. I'VE ALWAYS BEEN AN ADVOCATE FOR DOING THAT. 

MR. BORNSTEIN: THANK YOU. I HAVE NOTHING FURTHER, 

YOUR HONOR. 

THE COURT: ALL RIGHT. LET ME RETURN TO YOU THE 

REFRESHING RECOLLECTION DOCUMENT. AND OTHER THAN JX 006, ARE 

THERE ANY OTHER EXHIBITS THAT HAVE COME IN THROUGH MR. ALTMAN 

THAT REQUIRE SEALING? 

MR. BORNSTEIN: NO, YOUR HONOR. AND JX 006 I 

BELIEVE, YOUR HONOR, HAS ALREADY SEALED. 

THE COURT: RIGHT. I JUST WANT THE JOINT EXHIBIT 

LIST TO SPECIFY WHETHER A DOCUMENT IS BEING SEALED IN ITS 

ENTIRETY OR PORTIONS, BUT I WILL MENTION THAT LATER TO THE 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 82 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN REDIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

242

PARTIES. 

OKAY. THANK YOU. 

MR. BORNSTEIN: THANK YOU, YOUR HONOR. 

THE COURT: OKAY. IT'S 11:30. DO YOU HAVE ANY 

REDIRECT, OR NOT? 

MR. MATHESON: YES, YOUR HONOR. 

THE COURT: OKAY. 

(PAUSE IN PROCEEDINGS.) 

MR. MATHESON: MAY I PROCEED, YOUR HONOR? 

THE COURT: GO AHEAD. TIME IS 11:31. GO AHEAD, 

PLEASE. 

REDIRECT EXAMINATION

BY MR. MATHESON: 

Q. SIR, COULD YOU DIRECT YOUR ATTENTION TO JX 005, PLEASE. 

A. WHICH BINDER? 

Q. THIS IS THE NOKIA LICENSE AGREEMENT WE PREVIOUSLY 

DISCUSSED? 

A. I'M SORRY. I'VE GOT TWO BINDERS. WHICH BINDER ARE YOU 

LOOKING AT? 

Q. THE BINDER YOUR -- 

A. THIS ONE (INDICATING)? 

Q. -- QUALCOMM'S COUNSEL. 

SIR, YOU STATED AT THE TIME YOU NEGOTIATED THE NOKIA 

LICENSE AGREEMENT, CDMA HAD NOT YET BEEN STANDARDIZED; IS THAT 

TRUE? YOU SAID PREVIOUSLY THE STANDARD HAD NOT YET ISSUED AT 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 83 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN REDIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

243

THE TIME YOU NEGOTIATED THE NOKIA LICENSE? 

A. I BELIEVE THAT'S TRUE. 

Q. SO QUALCOMM HAD NOT MADE ANY FRAND COMMITMENTS REGARDING 

CDMA TO STANDARD SETTING BODIES AT THE TIME YOU NEGOTIATED THE 

NOKIA LICENSE; RIGHT? 

A. I DON'T KNOW. BECAUSE THERE'S A PERIOD OF TIME WHERE -- I 

DON'T KNOW THE DATES OF WHEN WE CONTRIBUTED TO THE STANDARDS 

BODY AND THEN WHEN IT ULTIMATELY CAME OUT AS A STANDARD.

Q. DO YOU KNOW ONE WAY OR THE OTHER -- 

A. WHEN WE MADE CONTRIBUTIONS, I BELIEVE THAT WE WERE MAKING 

THEM AS WELL, BUT I JUST DON'T KNOW THE TIME. 

Q. DO YOU KNOW IF YOU MADE A FRAND COMMITMENT TO ANY STANDARD 

SETTING ORGANIZATION AT THE TIME YOU NEGOTIATED THE LICENSE 

WITH NOKIA?

A. I DON'T KNOW ONE WAY OR THE OTHER.

Q. NOKIA SUBSEQUENTLY CLAIMED THAT LICENSE DID NOT COMPORT 

WITH FRAND COMMITMENTS THAT QUALCOMM MADE; ISN'T THAT RIGHT? 

A. YEAH, WE HAD -- LIKE I SAID BEFORE, WE HAD LITIGATION WITH 

THEM, AND I THINK THAT WAS ONE OF THEIR ARGUMENTS.

Q. AND QUALCOMM WAS NOT IN A POSITION TO CUT OFF CHIPSET 

SUPPLY TO NOKIA WHEN NOKIA BROUGHT THOSE CLAIMS BECAUSE NOKIA 

WASN'T BUYING ANY CHIPS FROM QUALCOMM AT THAT TIME; RIGHT? 

A. I BELIEVE THAT'S RIGHT. 

Q. DIRECT YOUR ATTENTION, SIR, TO TAB 26, OR SORRY, TAB 22 IN 

THE BINDER I HANDED YOU. IT'S CX 7234. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 84 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN REDIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

244

THIS DOCUMENT HAS BEEN PREVIOUSLY ADMITTED, YOUR HONOR. 

A. TAB -- WHICH TAB?

Q. I BELIEVE IT'S TAB 22. CX 7234. 

A. OKAY. WHAT PAGE?

Q. DO YOU RECOGNIZE THIS DOCUMENT AS A JANUARY 11TH, 2008, 

BERLIN DECK? 

A. YES. 

Q. NOW, YOU STATED YOU SAW SOME UPSIDE INTO SEPARATING QTL 

FROM QCT; RIGHT? 

A. YES. 

Q. AND ONE POTENTIAL UPSIDE WOULD BE THAT QTL COULD LICENSE 

COMPETITORS TO QCT IN THE CHIP SPACE; RIGHT? 

A. WE COULD LICENSE IN BOTH CASES, BUT WE WOULD BE ABLE TO DO 

SO IN A SPIN SCENARIO AS WELL AS A NON-SPIN SCENARIO.

Q. BUT IF QTL WAS NO LONGER CONCERNED WITH PROTECTING THE 

COMPETITIVE POSITION OF QCT, IT WOULD HAVE A FINANCIAL 

INCENTIVE TO ENABLE COMPETITORS TO QCT; ISN'T THAT RIGHT? 

A. I WOULD SAY WE WOULD HAVE STILL NO INCENTIVE TO LICENSE 

EXHAUSTIVELY, AND WE WOULD NOT HAVE LICENSED EXHAUSTIVELY.

Q. THAT WASN'T MY QUESTION, SIR. 

IF QTL WAS NOT CONCERNED WITH THE GOVERNMENT ABILITY OF 

QCT, IT WOULD HAVE AN INCENTIVE TO ENCOURAGE COMPETITORS TO QCT 

TO ENTER THE CHIP SPACE; RIGHT? 

A. IF WE DIDN'T CARE ABOUT QCT'S -- WE CARE ABOUT ALL OF 

OUR -- WE WANT ALL OF OUR LICENSEES TO DO WELL. SO IF WE HAD 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 85 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN REDIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

245

SPUN, QCT WAS THEN LICENSED TO SELL CHIPS, WE'D WANT THEM TO 

SELL CHIPS TO DEVICE MANUFACTURERS BECAUSE THE DEVICE 

MANUFACTURERS WOULD PAY US ROYALTIES. 

WE WOULD NOT HAVE GONE OUT AND LICENSED CHIP COMPANIES AT 

THAT POINT AND COLLECTED MORE ROYALTIES ON THE SALE OF CHIPS 

BECAUSE OUR BUSINESS WAS COLLECTING -- FROM LICENSING WAS 

COLLECTING ROYALTIES ON THE HANDSETS. 

SO IT WOULD HAVE -- I THINK IT'S FAIR TO SAY WE WOULD HAVE 

BEEN AMBIVALENT WHO WAS SELLING THE CHIPS, AS LONG AS THE CHIPS 

WERE BEING SOLD, AND WE WOULD BEEN VERY HAPPY THAT QCT WOULD 

HAVE BEEN SELLING THEM.

Q. BUT YOU WOULD HAVE BEEN EQUALLY HAPPY IF COMPETITORS TO 

QCT WOULD HAVE ENTERED THE SPACE AND SOLD CHIPS IN COMPETITION 

WITH QCT; RIGHT? 

A. AS A SEPARATE, INDEPENDENT LICENSING COMPANY, WE WOULD 

HAVE BEEN FOCUSSED ON COLLECTING ROYALTIES FOR OUR I.P. 

REGARDLESS OF WHO SOLD THE CHIPS. 

Q. TURN YOUR ATTENTION TO CX 7234-015. THIS SLIDE IS TITLED 

"SPIN RATIONALE: INABILITY TO ADDRESS BUSINESS CONFLICTS AS 

ONE COMPANY." 

DO YOU SEE THAT, SIR? 

A. YES.

Q. TURN YOUR ATTENTION -- DO YOU SEE THE FINAL BOTTOM OF THE 

PAGE THE ROW READS, "ABILITY TO CONTINUE TO SELL QUALCOMM I.P. 

AND TECHNOLOGY"? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 86 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ALTMAN REDIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

246

A. YES.

Q. NOW, THE RATIONALE, THE POSSIBLE MITIGATING ACTION WOULD 

BE TO ENABLE COMPETITION TO QCT BY PROVIDING DESIGNS AND/OR 

FINANCIAL INCENTIVES; RIGHT? 

A. YES.

Q. HALFWAY UP THE PAGE, THERE'S -- DO YOU SEE BROADCOM/NOKIA 

DISPUTES? IT'S BEEN REDACTED FOR PRIVILEGE? 

A. I DON'T SEE IT. 

Q. YOU CAN LOOK ON YOUR SCREEN, SIR. 

A. ON THIS SIDE? YEAH. 

Q. AT THE TIME QUALCOMM HAD ONGOING DISPUTES WITH NOKIA IN 

WHICH NOKIA ARGUED THAT QUALCOMM'S LICENSING PRACTICES DID NOT 

COMPORT WITH ITS FRAND OBLIGATIONS; CORRECT?

A. I BELIEVE SO. 

Q. BROAD -- 

A. THAT WAS AT LEAST ONE OF THEIR ARGUMENTS.

Q. BROADCOM, LIKEWISE, HAD AN ONGOING LITIGATION DISPUTE WITH 

QUALCOMM AT THIS TIME; RIGHT?

A. I THINK SO, YES.

Q. ONE OF THE THINGS THAT BROADCOM SOUGHT FROM QUALCOMM WAS 

AN EXHAUSTIVE LICENSE; IS THAT RIGHT? 

A. THEY DID SEEK IT, YES.

Q. AND YOU DIDN'T WANT TO GIVE THEM AN EXHAUSTIVE LICENSE 

BECAUSE THAT COULD HAVE A NEGATIVE EFFECT ON QUALCOMM'S 

LICENSING BUSINESS; RIGHT?

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 87 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

UNITED STATES COURT REPORTERS

247

A. THAT'S CORRECT. 

MR. MATHESON: NO FURTHER REDIRECT, YOUR HONOR. 

THE COURT: ALL RIGHT. TIME IS 11:37. 

IS THERE ANY RECROSS? 

MR. BORNSTEIN: THERE IS NOT, YOUR HONOR. 

THE COURT: ALL RIGHT. MAY THIS WITNESS BE EXCUSED, 

SUBJECT TO RECALL OR NOT SUBJECT TO RECALL FROM BOTH SIDES? 

MR. MATHESON: YES, YOUR HONOR, EXCUSED NOT SUBJECT 

TO RECALL. 

MR. BORNSTEIN: SAME FROM OUR PERSPECTIVE, YOUR 

HONOR. 

THE COURT: OKAY. THEN YOU HAVE COMPLETED YOUR TRIAL 

TESTIMONY. 

THE WITNESS: THANK YOU. 

THE COURT: OKAY. SO THAT'S NOT SUBJECT TO RECALL.

MS. MILICI: YOUR HONOR, THE FTC CALLS DEREK ABERLE. 

(PAUSE IN PROCEEDINGS.) 

THE CLERK: PLEASE STAND. WOULD YOU PLEASE RAISE 

YOUR RIGHT HAND. 

(PLAINTIFF'S WITNESS, DEREK ABERLE, WAS SWORN.)

THE WITNESS: YES. 

THE CLERK: THANK YOU. PLEASE BE SEATED. 

PLEASE STATE YOUR FULL NAME AND SPELL YOUR LAST NAME FOR 

THE RECORD. 

THE WITNESS: DEREK ABERLE. A-B-E-R-L-E. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 88 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

248

THE COURT: OKAY. ONE MINUTE. 

DO YOU HAVE -- DOES THAT HAVE DEPO TRANSCRIPTS AS WELL? 

THE CLERK: YES. 

THE COURT: OKAY. ALL RIGHT. THANK YOU. 

OKAY. TIME IS 11:39. GO AHEAD, PLEASE. 

DIRECT EXAMINATION

BY MS. MILICI: 

Q. GOOD MORNING, MR. ABERLE. I'M JENNIFER MILICI FROM THE 

FEDERAL TRADE COMMISSION. 

YOU ARE THE FORMER PRESIDENT OF QUALCOMM; CORRECT? 

A. CORRECT.

Q. AND YOU WORKED IN QTL FROM 2000 TO 2014, AND THEN WERE 

PRESIDENT OF QUALCOMM UNTIL YOU LEFT THE COMPANY IN JANUARY 

2018; IS THAT CORRECT? 

A. YES. 

Q. AND AFTER YOU LEFT THE COMPANY IN JANUARY 2018, YOU HAD A 

CONSULTING CONTRACT THAT LASTED FOR A COUPLE OF MONTHS AFTER 

THAT; CORRECT? 

A. YES. 

Q. AND WHILE YOU WERE EMPLOYED BY QUALCOMM, QUALCOMM HAD A 

POLICY OF NOT SELLING CHIPS TO OEM'S THAT DID NOT HAVE A 

LICENSE FOR THE PRODUCTS TO WHICH THE CHIPS WERE INTENDED TO 

GO; CORRECT? 

A. YES, THAT WAS THE GENERAL POLICY.

Q. AND QUALCOMM DID NOT CHANGE ITS POLICY AT ANY TIME WHILE 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 89 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

249

YOU WERE EMPLOYED THERE? 

A. NO. 

Q. AND YOU ARE NOT AWARE OF ANY OTHER BUSINESS THAT SELLS 

PRODUCTS AND REQUIRES, AS A CONDITION OF SALE, THAT THE 

PURCHASER ENTER A SEPARATE LICENSE AGREEMENT; IS THAT CORRECT? 

A. I THINK THERE ARE SOME OTHERS THAT DO THAT, YES. 

Q. AND AT YOUR DEPOSITION IN MARCH OF THIS YEAR, DO YOU 

RECALL TESTIFYING THAT YOU WERE UNAWARE OF ANYBODY WHO HAD A 

SIGNIFICANT LICENSING BUSINESS AND SOLD PRODUCTS AND DEVICES 

THAT ARE LICENSED? 

A. YEAH, I'M SORRY. I JUST -- I'M AWARE THAT THERE ARE, I 

THINK, AT LEAST A COUPLE OTHER COMPANIES, OR ONE, THAT HAS A 

PRACTICE OF NOT SELLING PRODUCTS TO A COMPANY THAT DOESN'T HAVE 

A LICENSE. I DON'T KNOW WHETHER THEY HAVE A SIGNIFICANT 

LICENSING BUSINESS, SO...

Q. DURING YOUR DEPOSITION WHEN I ASKED YOU THAT QUESTION, YOU 

DIDN'T IDENTIFY ANY SUCH COMPANIES, DID YOU? 

A. I DON'T RECALL. 

Q. COULD YOU PLEASE TURN TO TAB 1 IN YOUR BINDER? 

AND CAN YOU IDENTIFY THIS DOCUMENT AS AN E-MAIL FROM 

MARV BLECKER, JANUARY 2002, AND IT'S TO AN INDIVIDUAL FROM 

CURITEL AND COPIED TO YOU AND OTHERS. 

A. YES. 

MS. MILICI: AND I MOVE TO ADMIT CX 6469. 

MR. BORNSTEIN: THERE'S NO OBJECTION. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 90 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

250

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 6469 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MS. MILICI: 

Q. IF YOU LOOK AT THE LAST PARAGRAPH OF THIS E-MAIL FROM 

MARV BLECKER HE WRITES, "FOR YOUR INFORMATION, I'M ASKING OUR 

QCT DIVISION TO HOLD ALL SALES AND SHIPMENTS OF CDMA ASICS TO 

CURITEL UNTIL THIS AGREEMENT IS EXECUTED BECAUSE QUALCOMM DOES 

NOT SELL CDMA ASICS TO NON-LICENSEES."

MARV BLECKER WAS THE SENIOR VICE PRESIDENT OF QTL AT THE 

TIME? 

A. YES. 

Q. AND THIS IS AN ACCURATE STATEMENT OF QUALCOMM'S POLICY? 

A. I'M NOT SURE. I MEAN, THE DOCUMENT SAYS WHAT YOU READ. 

Q. OKAY. IS THE STATEMENT THAT QUALCOMM DOES NOT SELL CDMA 

ASICS TO NON-LICENSEES AN ACCURATE STATEMENT ABOUT THE POLICY? 

A. YES. 

Q. COULD YOU PLEASE TURN TO TAB 2 IN YOUR BINDER. AND CAN 

YOU IDENTIFY THIS AS AN E-MAIL EXCHANGE -- THIS IS CX 7650 -- 

AS AN E-MAIL EXCHANGE THAT YOU PARTICIPATED IN IN FEBRUARY OF 

2012? 

A. YES. 

MS. MILICI: YOUR HONOR, I MOVE TO ADMIT CX 7650. 

MR. BORNSTEIN: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 91 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

251

(PLAINTIFF'S EXHIBIT CX 7650 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MS. MILICI: 

Q. AND IF WE TURN TO THE FIRST E-MAIL IN THE CHAIN, IT'S 

DATED FEBRUARY 16TH, 2012. THERE'S AN E-MAIL FROM 

ERIC REIFSCHNEIDER TO JONATHAN PEARL THAT SAYS, "HERE IS A 

DRAFT OF THE CDMA SULA AS WE DISCUSSED LAST WEEK." 

DO YOU SEE THAT? 

AND A SULA IS A SUBSCRIBER UNIT LICENSE AGREEMENT? 

A. YES.

Q. AND A CDMA SULA IS A SUBSCRIBER UNIT LICENSE AGREEMENT 

THAT APPLIES TO CDMA; CORRECT? 

A. YES.

Q. AND ERIC REIFSCHNEIDER WAS OUTSIDE COUNSEL FOR QUALCOMM AT 

THE TIME? 

A. YES, I BELIEVE SO BASED ON THE E-MAIL. 

Q. AND JONATHAN PEARL WAS AN EMPLOYEE OF SONY? 

A. I THINK HE WOULD HAVE BEEN AT SONY ERICSSON, WHICH BECAME 

SONY MOBILE. 

Q. AND MR. PEARL RESPONDED TO ERIC REIFSCHNEIDER, AND IN HIS 

E-MAIL HE SAYS, "I SEE IT REFERS TO 5 PERCENT, AND AS I SAID IN 

OUR MEETING, WE ARE NOT EXPECTING TO PAY AT THAT LEVEL." 

DO YOU SEE THAT? 

A. YES.

Q. AND SO 5 PERCENT WAS QUALCOMM'S STANDARD ROYALTY RATE AT 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 92 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

252

THE TIME? 

A. FOR A 3G LICENSE FOR SUBSCRIBER UNITS, 5 PERCENT WOULD 

HAVE BEEN THE TYPICAL RUNNING ROYALTY AT THE TIME.

Q. AND SONY WAS NOT EXPECTING TO PAY AT THAT LEVEL; CORRECT? 

A. THAT'S WHAT MR. PEARL WAS COMMUNICATING. I DON'T KNOW 

WHAT THEY ACTUALLY EXPECTED.

Q. AND THEN IF YOU LOOK UP TO THE NEXT E-MAIL FROM 

ERIC REIFSCHNEIDER HE WROTE, IN THE FIRST PARAGRAPH, "AS WE 

DISCUSSED IN NEW YORK, WE NEED TO GET A NEW LICENSE AGREEMENT 

IN PLACE QUICKLY SO WE CAN AVOID ANY DISRUPTION IN SUPPLY." 

DO YOU SEE THAT? 

A. YES, I SEE THAT. 

Q. AND THEN AT THE END OF HIS E-MAIL HE SAYS, "I UNDERSTAND 

THAT THERE ARE SEVERAL CHIPSET ORDERS SCHEDULED TO CHIP THIS 

WEEK, SO WE NEED TO MOVE QUICKLY ON THAT." 

DO YOU SEE THAT? 

A. YES.

Q. AND MR. REIFSCHNEIDER WAS STILL OUTSIDE COUNSEL AND YOU 

WERE COPIED ON THIS E-MAIL; CORRECT? 

A. YES. 

Q. CAN YOU PLEASE TURN TO TAB 3. THIS IS CX 6522, WHICH WAS 

ADMITTED ON FRIDAY. 

AND PLEASE TURN TO PAGE 004 OF THE DOCUMENT. AND AT THE 

BOTTOM OF PAGE 004 THERE'S AN E-MAIL FROM YOU TO 

ENRICO SALVATORI AND OTHERS. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 93 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

253

DO YOU SEE THAT? 

A. YES.

Q. AND WHO IS MR. SALVATORI? 

A. HE WAS BASICALLY THE HEAD OF OUR EUROPEAN OPERATION -- 

Q. AND -- 

A. -- AT THE TIME.

Q. THANK YOU. SORRY FOR SPEAKING OVER YOU. 

AND YOU WROTE IN THIS E-MAIL AT THE BOTTOM OF THE FIRST 

PARAGRAPH, "HE CONFIRMED THEY UNDERSTOOD THAT THE ERICSSON 

LICENSE WOULD NOT CONTINUE AND THAT THEY WOULD NEED TO CONCLUDE 

A NEW LICENSE IN ORDER TO AVOID A DISRUPTION IN SUPPLY." 

DO YOU SEE THAT?

A. YES.

Q. AND SO YOU WERE REPORTING TO MR. SALVATORI AND OTHERS THAT 

YOU HAD TOLD SONY MOBILE THAT THEY WOULD NEED TO CONCLUDE A NEW 

LICENSE IN ORDER TO AVOID A DISRUPTION IN SUPPLY; CORRECT? 

A. YES. 

Q. AND THEN IN THE LAST PARAGRAPH OF YOUR E-MAIL YOU WROTE, 

"TO MY KNOWLEDGE, WE HAVE NEVER SHIPPED COMMERCIAL QUANTITIES 

OF CHIPS TO A COMPANY WITHOUT A LICENSE. WE CAN'T DO THAT HERE 

EITHER. SINCE MY UNDERSTANDING IS THAT WE STILL HAVE A CSA IN 

PLACE THAT PROHIBITS SONY MOBILE FROM USING THE CHIPS WE SELL 

THEM IN SUBSCRIBER UNITS THAT ARE NOT LICENSED." 

DO YOU SEE THAT?

A. YES.

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 94 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

254

Q. AND THE CSA THAT YOU'RE REFERRING TO THERE IS A COMPONENT 

SUPPLY AGREEMENT? 

A. YES.

Q. AND IT'S YOUR UNDERSTANDING THAT THE COMPONENT SUPPLY 

AGREEMENT PROHIBITS LICENSEES FROM USING CHIPS IN SUBSCRIBER 

UNITS THAT ARE NOT LICENSED BY QUALCOMM? 

A. I THINK GENERALLY THAT'S THE CASE, YES. 

Q. LET'S TURN TO TAB 4, PLEASE. THIS IS JX 00063. 

I MOVE TO ADMIT THIS DOCUMENT. 

MR. BORNSTEIN: THERE'S NO OBJECTION, YOUR HONOR. 

THE COURT: IT'S ADMITTED. 

(JOINT EXHIBIT JX 0063 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MS. MILICI: 

Q. MR. ABERLE, DO YOU RECOGNIZE THIS DOCUMENT? 

A. YES. 

Q. OKAY. IS THIS A SUBSCRIBER UNIT LICENSE AGREEMENT ENTERED 

BETWEEN SONY AND QUALCOMM IN MAY OF 2012? 

A. BETWEEN SONY MOBILE AND QUALCOMM, YES. 

Q. OKAY. AND COULD YOU PLEASE TURN TO PAGE 015. 

AND DO YOU SEE UNDER THE NUMBER 4 IT SAYS ROYALTIES? 

A. YES. 

Q. AND UNDER NUMBER 4.1 IT SAYS ROYALTIES FOR SUBSCRIBER 

UNITS? 

DO YOU SEE THAT?

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 95 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

255

A. YES.

Q. AND THE LICENSE PROVIDES FOR A RUNNING ROYALTY RATE OF 

5 PERCENT OF THE NET SELLING PRICE. 

DO YOU SEE THAT? 

A. I SEE THAT IN THE FIRST PARAGRAPH, YES. 

BUT THERE WAS -- ACTUALLY IT WAS SUBJECT TO ADJUSTMENT, 

POTENTIALLY SUBJECT TO ADJUSTMENT LATER.

Q. BUT IT DOES PROVIDE FOR A 5 PERCENT RUNNING ROYALTY RATE 

IF THERE'S NO ADJUSTMENT; CORRECT? 

A. YES. SO THE IDEA WAS IT WOULD BE PAID -- 

Q. THANK YOU. 

A. -- DURING THE INTERIM PERIOD, AND THEN IT COULD BE SUBJECT 

TO ADJUSTMENT LATER.

Q. WHEN DID THIS AGREEMENT TERMINATE? 

A. I DON'T REMEMBER. I BELIEVE IT WAS A SHORT-TERM 

AGREEMENT, SOMEWHERE BETWEEN NINE MONTHS AND A YEAR I THINK. 

Q. CAN YOU PLEASE TURN TO PAGE 12. IT SAYS TERM OF 

AGREEMENT. DO YOU SEE THAT IT SAYS THAT THE AGREEMENT WILL 

TERMINATE ON SEPTEMBER 30TH, 2012? 

A. YES, I SEE THAT.

Q. DOES THAT REFRESH YOUR RECOLLECTION THAT THIS -- THE 

DURATION OF THIS AGREEMENT WAS FOR FOUR MONTHS? 

A. WELL, IT WAS FROM FEBRUARY UNTIL SEPTEMBER.

Q. BUT IT WAS SIGNED IN MAY; CORRECT? 

A. OH, I DIDN'T SEE THAT. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 96 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

256

Q. WE CAN MOVE ON. 

CAN YOU PLEASE LOOK AT THE NEXT TAB, WHICH IS TAB 5. THIS 

IS JX 0072. 

AND, YOUR HONOR, I MOVE TO ADMIT JX 0072. 

MR. BORNSTEIN: NO OBJECTION, YOUR HONOR. 

THE COURT: IT'S ADMITTED. 

(JOINT EXHIBIT JX 0072 WAS ADMITTED IN EVIDENCE.) 

THE COURT: THIS APPEARS TO BE A SUBSCRIBER UNIT 

PATENT LICENSE AGREEMENT DATED OCTOBER 1ST, 2012. 

DO YOU SEE THAT? 

A. YES.

Q. AND THEN LET'S TURN TO PAGE 23. AND UNDER ROYALTIES IT 

PROVIDES A RUNNING ROYALTY RATE OF THE NET SELLING PRICE OF 

5 PERCENT. 

DO YOU SEE THAT? 

A. YES. 

Q. OKAY. AND THAT 5 PERCENT IS NOT SUBJECT TO ADJUSTMENT? 

A. I DON'T BELIEVE SO. I DON'T SEE ANYTHING IN IT.

Q. OKAY. AND THAT 5 PERCENT IS THE SAME ROYALTY RATE THAT 

JONATHAN PEARL SAID IN FEBRUARY THAT SONY WAS NOT EXPECTING TO 

PAY; CORRECT? 

A. I BELIEVE THE E-MAIL YOU SHOWED ME SAID THEY WERE NOT 

EXPECTING TO PAY 5 PERCENT. 

Q. RIGHT. 

CAN WE PLEASE TURN TO TAB 7. THIS IS CX 6974. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 97 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

257

CAN YOU IDENTIFY THIS AS A PACKAGE OF BOARD MATERIALS THAT 

WENT TO THE BOARD IN JULY OF 2012?

THE COURT: WAS THIS PREVIOUSLY ADMITTED? 

MS. MILICI: I DO NOT BELIEVE SO. 

THE COURT: OKAY. 

THE WITNESS: FROM THE E-MAIL, IT LOOKS LIKE THAT'S 

WHAT IT IS. 

BY MS. MILICI: 

Q. OKAY. SO -- AND YOU WERE ON THE EXECUTIVE COMMITTEE AT 

THE TIME? 

A. YES. 

Q. PLEASE TURN TO -- DID I JUST MOVE TO ADMIT CX 6974, OR NO? 

THE COURT: YOU HADN'T YET. 

MS. MILICI: THANK YOU. I MOVE TO ADMIT CX 6974, 

PLEASE. 

MR. BORNSTEIN: I DO NOT OBJECT. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 6974 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

MS. MILICI: THANK YOU. 

Q. CAN WE PLEASE TURN TO PAGE 64. 

AND THIS PAGE 64 IS THE BEGINNING OF A STRATEGIC PLAN 

REVIEW. 

DO YOU SEE THAT? 

A. YES. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 98 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

258

Q. AND DO YOU RECALL SUBMITTING SLIDES FOR THIS STRATEGIC 

PLAN REVIEW? 

A. NOT SPECIFICALLY, BUT WE DID IT KIND OF ON AN ANNUAL 

CADENCE, AND IT LOOKS LIKE THAT'S WHAT THIS IS.

Q. AND YOU WOULD HAVE PROPOSED SLIDES FOR THIS SECTION OF THE 

BOARD DECK; RIGHT? 

A. IN 2012? IT PROBABLY WOULD HAVE BEEN A COMBINATION OF 

MR. REIFSCHNEIDER AND MYSELF.

Q. COULD YOU PLEASE TURN BACK IN YOUR BINDER TO TAB 6, 

PLEASE. AND THIS IS CX 6998. 

A. YEP. 

Q. AND CAN YOU IDENTIFY THIS AS AN E-MAIL FROM YOU TO 

PAUL JACOBS DATED JULY 2ND, 2012? 

A. YES. 

MS. MILICI: I MOVE TO ADMIT CX 6998. 

MR. BORNSTEIN: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 6998 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MS. MILICI: 

Q. AND IN THIS E-MAIL, YOU SAY "HERE ARE MY SUGGESTED QTL 

SLIDES." 

DO YOU SEE THAT? 

A. YES. 

Q. DOES THAT REFRESH YOUR RECOLLECTION THAT YOU PROPOSED THE 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 99 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

259

SLIDES THAT WENT INTO THE BOARD DECK? 

A. YEAH, IT LOOKS LIKE I SENT THEM ALONG. ALL I WAS SAYING 

IS IT WAS PROBABLY DONE COLLABORATIVELY BETWEEN 

MR. REIFSCHNEIDER AND THE OTHERS.

Q. BUT YOUR E-MAIL SAYS HERE ARE MY SUGGESTED QTL SLIDES; 

CORRECT? 

A. YES. 

Q. AND THEN IF WE CAN TURN BACK TO TAB 7, AND LET'S TURN TO 

PAGE 068, PLEASE. 

AND ON THIS SLIDE IT SAYS STANDARD ESSENTIAL PATENTS, AND 

THEN UNDER STRATEGY, THE FIRST, THE FIRST SMALL BULLET SAYS, 

"SIGNIFICANT PORTION OF VALUE OF LICENSING PROGRAM DERIVES FROM 

STANDARD-ESSENTIAL PATENTS." 

DO YOU SEE THAT? 

A. YES. 

Q. AND THAT WAS A TRUE STATEMENT IN JULY OF 2012? 

A. YES. 

Q. COULD YOU PLEASE TURN TO PAGE 70. AND THIS PAGE CONCERNS 

AN ISSUE THAT WAS RAISED IN THE QTL STRATEGIC PLAN THAT WAS 

SUBMITTED TO THE BOARD, AND IT'S ABOUT THE SALE OF CHIPSETS TO 

UNLICENSED ENTITIES OR ENTITIES CLAIMING EXHAUSTION. 

DO YOU SEE THAT? 

A. YES.

Q. AND THIS IS ONE OF THE SLIDES THAT YOU SUGGESTED TO 

PAUL JACOBS? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 100 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

260

A. IT LOOKS LIKE IT WAS IN THE DECK THAT I SENT, YES. 

Q. AND THIS REFERS TO SLIDES TO -- SALES TO UNLICENSED 

ENTITIES OR THOSE CLAIMING EXHAUSTION, DESPITE THE TERMS OF OUR 

SUPPLY AND LICENSE AGREEMENTS. 

DO YOU SEE THAT? 

A. YES. 

Q. AND IS IT YOUR UNDERSTANDING THAT THE TERMS OF THE SUPPLY 

AND LICENSE AGREEMENTS ARE DESIGNED TO AVOID CLAIMS OF 

EXHAUSTION? 

A. YES. 

Q. AND UNDER THE FIRST BULLET IT SAYS, "SUCH CLAIMS --" -- 

"SUCH SALES PRESENT THE RISK OF A FINDING OF PATENT EXHAUSTION 

IN THE EVENT OF A DISPUTE OVER ROYALTIES." 

DO YOU SEE THAT? 

A. I SEE THAT.

Q. AND THAT ISSUE WAS A CONCERN TO QTL AT THE TIME? 

A. I THINK THROUGHOUT THE LICENSING PROGRAM WE HAD 

SIGNIFICANT CONCERNS ABOUT SELLING CHIPS TO A COMPANY THAT DID 

NOT HAVE A LICENSE BECAUSE THEY COULD CLAIM EXHAUSTION AND, IN 

FACT, MANY OF THEM DID FROM TIME TO TIME. 

Q. BUT -- THANK YOU. 

AND IN THE NEXT BULLET IT SAYS, "IF WE CEASE SUPPLY OF 

CHIPS TO CURRENT CUSTOMERS THEY MAY ASSERT ANTITRUST CLAIMS 

SEEKING DAMAGES/FINES AND CONTINUED SUPPLY." 

DO YOU SEE THAT? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 101 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

261

A. YES. 

Q. AND THAT WAS A STATEMENT THAT WAS MADE TO THE BOARD IN 

JULY 2012?

A. WELL, IT WAS IN THESE MATERIALS THAT WERE PRESENTED TO THE 

BOARD, YES.

Q. THANK YOU. 

UNDER STRATEGY, IT SAYS, "DEVELOP A PLAN OF 

COMMUNICATION/ACTION THAT MAXIMIZES OUR ABILITY TO DEFEND 

AGAINST THE ABOVE CLAIMS WHILE CEASING SUPPLY WHEN NECESSARY." 

DO YOU SEE THAT? 

A. YES.

Q. AND THIS WAS A STRATEGY THAT WAS COMMUNICATED TO THE BOARD 

IN JULY OF 2012? 

A. I THINK WHAT WE WERE COMMUNICATING WAS THAT RATHER THAN 

HAVE TO JUST REACT WHEN THESE SITUATIONS AROSE, WE WANTED TO 

COME UP WITH A PROACTIVE PLAN TO MAKE SURE WE COULD GET OUT 

AHEAD OF SITUATIONS WHERE THERE MAY BE A DISPUTE OR A LICENSE 

RENEWAL THAT NEEDED TO HAPPEN AND SOMEBODY WAS BUYING CHIPS 

FROM US. 

Q. SIR, CAN YOU PLEASE TURN TO PAGE 218, LINE 7 OF YOUR 

DEPOSITION, WHICH SHOULD BE SITTING UP RIGHT NEXT TO YOU. 

A. I'M SORRY, WHAT PAGE?

Q. 218, LINE 7. 

NOW, AT YOUR DEPOSITION -- I'M SORRY. HAVE YOU FOUND IT 

YET? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 102 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

262

NOW, AT YOUR DEPOSITION I ASKED YOU: DID QUALCOMM COME UP 

WITH A PLAN OF COMMUNICATION THAT WOULD MAXIMIZE ITS ABILITY TO 

DEFEND AGAINST EXHAUSTION CLAIMS WHILE BEING ABLE TO CEASE 

SUPPLY WHEN NECESSARY?"

DO YOU SEE THAT? 

A. YES.

Q. AND YOUR ANSWER WAS, "ACTUALLY, AS I READ THAT, I DON'T 

RECALL IT. I DON'T ACTUALLY KNOW WHAT IT MEANS." 

SO IS IT YOUR TESTIMONY THAT TODAY YOU DO KNOW WHAT IT 

MEANS AND IN MARCH YOU DID NOT KNOW WHAT IT MEANS?

A. I'M GIVING YOU MY RECOLLECTION AS I SIT HERE, AND MY 

RECOLLECTION IS THAT WE WERE COMMUNICATING TO THE BOARD THAT WE 

WANTED TO WORK ON A PLAN TO PROACTIVELY DEAL WITH THESE 

SITUATIONS WHEN THEY AROSE. 

Q. BUT AT YOUR DEPOSITION -- 

A. AND AT MY DEPOSITION THAT'S WHAT I SAID, YES.

Q. AT YOUR DEPOSITION IN MARCH YOU SAID, "I DON'T RECALL SUCH 

A PLAN." 

CORRECT. 

A. YES, THAT'S WHAT IT SAYS.

Q. THANK YOU. AND YOU HAVEN'T BEEN EMPLOYED BY QUALCOMM 

SINCE YOUR DEPOSITION; CORRECT? 

A. NO. 

Q. LET'S TURN TO TAB 8, PLEASE, IN YOUR BINDER. AND THIS IS 

CX 53 -- I'M SORRY. CX 5231. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 103 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

263

CAN YOU IDENTIFY THAT AS AN E-MAIL EXCHANGE BETWEEN 

YOURSELF AND STEVE MOLLENKOPF IN MAY OF 2013? 

A. YES. 

MS. MILICI: MOVE TO ADMIT CX 5231. 

MR. BORNSTEIN: NO OBJECTION. 

THE COURT: AND I'D LIKE TO TAKE OUR BREAK NOW, IF 

THAT'S OKAY. 

MS. MILICI: SURE. 

THE COURT: ALL RIGHT. IT'S 12:02. 12:02 AND 8 

SECONDS. WE'LL GO AHEAD AND END IT. 

OKAY. WE'LL TAKE A BREAK UNTIL 1:05. THANK YOU. 

THE REPORTER: IS THAT EXHIBIT ADMITTED? 

THE COURT: YES, THAT EXHIBIT IS ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 5231 WAS ADMITTED IN EVIDENCE.) 

THE CLERK: COURT IS IN RECESS. 

(THE LUNCH RECESS WAS TAKEN FROM 12:02 P.M. UNTIL 1:07 

P.M.) 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 104 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

264

AFTERNOON SESSION

 (COURT CONVENED AT 1:07 P.M.) 

THE COURT: GOOD AFTERNOON. WELCOME BACK. 

MR. VAN NEST: GOOD AFTERNOON, YOUR HONOR. 

THE COURT: ON THE JOINT -- PLEASE TAKE A SEAT. 

ON THE JOINT EXHIBIT LIST, I REALIZED IF YOU START PUTTING 

IN YOUR DESCRIPTION, YOU'LL FILE A BUNCH OF SEALING MOTIONS AS 

TO EVERY DRAFT JOINT EXHIBIT LIST. SO I THINK THAT'S -- I 

THINK YOU'VE BEEN OVERBROAD IN YOUR REQUESTS TO SEAL YOUR 

EXHIBIT LISTS, AS MY ORDER YESTERDAY SAID, AND I THINK YOU HAVE 

UNTIL THE 14TH TO FILE RENEWED MOTIONS ON THAT. 

BUT TO AVOID UNNECESSARY SEALING MOTIONS, I WILL ASK YOU 

TO HOLD OFF ON PUTTING IN THE DESCRIPTIONS UNTIL THE END, OR AT 

LEAST UNTIL AFTER I'VE RULED ON YOUR JANUARY 14 FILING BECAUSE 

HOPEFULLY THAT'LL GIVE YOU SOME GUIDANCE AND THAT CAN MINIMIZE 

UNNECESSARY SEALING MOTIONS. 

OKAY. 

MR. VAN NEST: THANK YOU, YOUR HONOR. 

THE COURT: ALL RIGHT. LET'S GO AHEAD, PLEASE, 

AND -- WHAT'S THE TIME NOW, PLEASE? 

THE REPORTER: 1:08. 

THE COURT: 1:08. GO AHEAD, PLEASE. 

BY MS. MILICI: 

Q. WELCOME BACK, MR. ABERLE. 

A. THANK YOU.

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 105 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

265

Q. RIGHT BEFORE THE BREAK WE WERE LOOKING AT CX 5231, WHICH 

HAD JUST BEEN ADMITTED, AND THIS IS AN E-MAIL EXCHANGE BETWEEN 

YOURSELF AND STEVE MOLLENKOPF; CORRECT? 

A. YES.

Q. AND STEVE MOLLENKOPF WAS THE CEO? 

A. NO, NOT AT THIS TIME. HE WAS, I THINK, THE PRESIDENT. 

Q. OKAY. AND ON YOUR E-MAIL THAT'S MAY 20TH, 2013, THAT'S 

HIGHLIGHTED ON THE SCREEN RIGHT NOW, YOU WROTE TO 

MR. MOLLENKOPF, "I SUGGEST THAT YOU MAKE THE FOLLOWING POINTS 

TO HUAWEI'S CEO." 

DO YOU SEE THAT? 

A. YES.

Q. AND THEN YOUR LAST POINT THERE IS, "IF THEY DON'T EXTEND 

WE WILL HAVE ISSUES RE CONTINUED CHIP SUPPLY ON C2K. NOTE THAT 

HUAWEI HAS BEEN CLAIMING PATENT EXHAUSTION BASED ON THEIR 

PURCHASE OF CHIPS FROM QC DESPITE THE TERMS OF OUR SUPPLY 

AGREEMENT." 

DO YOU SEE THAT?

A. YES.

Q. AND THE SUPPLY AGREEMENT YOU WERE REFERRING TO THERE IS A 

COMPONENT SUPPLY AGREEMENT? 

A. I BELIEVE SO. 

Q. AND THE SUPPLY AGREEMENT BETWEEN QUALCOMM AND HUAWEI 

SPECIFIED THAT THE SALE OF MODEM CHIPS TO HUAWEI WOULD NOT 

CONVEY ANY INTELLECTUAL PROPERTY RIGHTS TO HUAWEI? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 106 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

266

A. I'M SORRY. COULD YOU REPEAT THAT?

Q. SURE. THE SUPPLY AGREEMENT BETWEEN QUALCOMM AND HUAWEI 

SPECIFIED THAT THE SALE OF MODEM CHIPS WOULD NOT CONVEY ANY 

INTELLECTUAL PROPERTY RIGHTS? 

A. I BELIEVE SO. 

Q. AND WHEN YOU SUGGESTED TO MR. MOLLENKOPF THAT HE MAKE THE 

POINT TO THE CEO OF HUAWEI THAT QUALCOMM WILL HAVE ISSUES 

REGARDING CONTINUED SUPPLY, HE RESPONDED, "I GOT IT. THANKS." 

DO YOU SEE THAT? 

A. YES. 

Q. LET'S TURN TO TAB 9. THIS IS JX 93. 

YOUR HONOR, I MOVE TO ADMIT JX 93. 

MR. BORNSTEIN: NO OBJECTION, YOUR HONOR. 

THE COURT: IT'S ADMITTED. 

(JOINT EXHIBIT JX 93 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MS. MILICI: 

Q. AND THIS IS A -- APPEARS TO BE A SERIES OF AGREEMENTS 

BETWEEN QUALCOMM AND RESEARCH IN MOTION. 

I WANTED TO LOOK AT THE AGREEMENT THAT STARTS AT PAGE 116. 

THAT'S DASH 116. 

NOW, THIS IS A SUPPLY AGREEMENT. 

DO YOU SEE THAT? 

A. I'M SORRY. WHICH PAGE WAS IT?

Q. DASH 116. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 107 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

267

A. OH, 116. 

MR. BORNSTEIN: YOUR HONOR, WHILE MR. ABERLE IS 

REVIEWING THE DOCUMENT, I'D LIKE TO ASK THAT WE JUST TAKE THIS 

ONE, SINCE IT'S AN ACTIVE AGREEMENT, DOWN OFF THE SCREEN. 

MS. MILICI: (INDICATING).

MR. BORNSTEIN: THANK YOU. 

THE COURT: OKAY. ARE YOU GOING TO BE REQUESTING 

SEALING ON THIS DOCUMENT? 

MR. BORNSTEIN: WE MIGHT. I'LL HAVE TO CONSULT WITH 

THE CLIENT WHETHER WE'LL BE REQUESTING SEALING. I DIDN'T WANT 

TO INTERRUPT THE EXAMINATION. IF WE TAKE IT DOWN OFF THE 

SCREEN, I THINK IT'S OKAY. 

THE COURT: NO. WE'RE GOING TO HANDLE THE SEALING 

RIGHT NOW. WHAT'S THE TIME? THE TIME IS 1:11. 

THE CLIENT DOESN'T KNOW WHETHER YOU WANT THIS AGREEMENT 

SEALED OR NOT? WHY DON'T YOU MAKE THE CONSULTATION. 

MR. BORNSTEIN: THANK YOU, YOUR HONOR. 

THE COURT: UM-HUM. THE TIME IS 1:11. 

(PAUSE IN PROCEEDINGS.) 

MR. BORNSTEIN: OKAY, YOUR HONOR. 

THE COURT: ALL RIGHT. WHAT WOULD YOU LIKE TO SEAL? 

MR. BORNSTEIN: I'M ON PAGE 019 OF THE DOCUMENT, YOUR 

HONOR. 

THE COURT: OKAY. 

MR. BORNSTEIN: AND YOU'LL SEE THERE ARE A NUMBER OF 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 108 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

268

NUMBERS. 

THE COURT: THAT'S FINE. SO YOU WANT TO SEAL -- 

MR. BORNSTEIN: JUST THE NUMBERS THERE. 

THE COURT: DO YOU WANT TO JUST SEAL 3.1.1? 

MR. BORNSTEIN: YES, PLEASE. AND SUBSECTION A, 

CARRYING OVER TO THE FOLLOWING PAGE, AND THEN SUBSECTION B, 

YOUR HONOR WILL SEE THERE ARE SOME NUMBERS THERE AS WELL. 

THE COURT: OKAY. YOU'RE ONLY SEEKING TO SEAL THE 

NUMBERS, OR DO YOU WANT THE WHOLE SECTION? 

MR. BORNSTEIN: IF WE CAN SEAL THE WHOLE SECTION, 

THAT WOULD BE BETTER. 

THE COURT: I THINK THE WAY I'VE DONE THE SAMSUNG AND 

THE BROADCOM IS THE NUMBERS. 

MR. BORNSTEIN: OKAY. THAT'S FINE, YOUR HONOR. 

THE COURT: ALL RIGHT. 

MR. BORNSTEIN: I'LL JUST NOTE THAT THE NUMBERS ARE 

WRITTEN TWO WAYS, THE NUMERALS AND ALSO WRITTEN OUT IN WORDS. 

THE COURT: THAT'S FINE. THEY'LL BOTH BE SEALED. 

MR. BORNSTEIN: AND THEN ALSO THERE'S SOME ADDITIONAL 

INFORMATION, YOUR HONOR, ON PAGE 022. AND YOU'LL SEE THAT 

3.1.2.2 HAS A BUNCH OF NUMBERS ON PAGES 022 AND 023 THAT WE 

WOULD ASK TO BE SEALED. 

THE COURT: ALL THOSE NUMBERS WILL BE SEALED. 

MR. BORNSTEIN: GREAT. THANK YOU, YOUR HONOR. 

I APOLOGIZE FOR THE INTERRUPTION. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 109 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

269

THE COURT: NOT A PROBLEM. 3.1.2.2. 

MR. BORNSTEIN: I THINK IT MIGHT BE 3.1.2.2, AND THE 

COURT IS ALSO CORRECT ABOUT 3.1.2. 

THE COURT: .3. 

MR. BORNSTEIN: TO BOTH SECTIONS. 

THE COURT: THE NUMBERS IN ALL OF THOSE SECTIONS, 

THOSE TWO SECTIONS WILL BE SEALED. 

MR. BORNSTEIN: THANK YOU, YOUR HONOR. 

THE COURT: GO AHEAD, PLEASE. SO I'LL NOTE THAT THIS 

IS FOR SEALING PURPOSES THAT PORTIONS HAVE BEEN SEALED. OKAY. 

MS. MILICI: AND TO THE EXTENT THAT I'M SHOWING THE 

SUPPLY AGREEMENT, THAT CAN STILL BE PUBLIC; CORRECT? 

MR. BORNSTEIN: YES. 

MS. MILICI: OKAY. 

THE COURT: OKAY. TIME IS 1:14. GO AHEAD. IT'S 

YOUR TIME. 

BY MS. MILICI: 

Q. OKAY. SO LOOKING AT THE SUPPLY AGREEMENT, COULD YOU 

PLEASE LOOK AT SECTION 14, WHICH IS ON PAGE 120. 

AND THIS SAYS, "EXCEPT AS EXPRESSLY PROVIDED IN PARAGRAPH 

11, THE SALE OF PRODUCT AND LICENSE OF SOFTWARE TO BUYER DOES 

NOT CONVEY TO BUYER ANY INTELLECTUAL PROPERTY RIGHTS IN SUCH 

PRODUCT OR SOFTWARE." 

DO YOU SEE THAT? 

A. YES.

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 110 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

270

Q. AND IS THAT THE PROVISION OF THE COMPONENT SUPPLY 

AGREEMENT THAT YOU REFERENCED IN SOME OF THESE OTHER DOCUMENTS 

AS PREVENTING CLAIMS OF EXHAUSTION? 

A. I DON'T KNOW WHETHER IT SPECIFICALLY WAS THIS LANGUAGE. 

IT ACTUALLY WAS, FROM OUR PERSPECTIVE, THE COMBINATION OF THE 

LANGUAGE IN THE SUPPLY AGREEMENT, AS WELL AS THE LICENSE 

AGREEMENT WITH THE CUSTOMER TOGETHER THAT WE BELIEVED PROTECTED 

AGAINST THE EXHAUSTION CLAIM. 

Q. CAN WE LOOK AT THE NEXT PAGE, WHICH IS .16 IT SAYS TERM 

AND TERMINATION, AND IT SAYS THAT THE AGREEMENT WILL BE 

TERMINATED IF, AND THE LAST POINT IS, "BUYER IS IN DEFAULT 

UNDER THE LICENSE AGREEMENT." 

DO YOU UNDERSTAND THAT QUALCOMM'S SUPPLY AGREEMENT WOULD 

BE -- COULD BE TERMINATED IF THE BUYER WAS IN DEFAULT UNDER A 

LICENSE AGREEMENT? 

A. I DON'T KNOW WHETHER ALL THE SUPPLY AGREEMENTS HAVE THAT 

LANGUAGE. THIS LANGUAGE SAYS THAT, THAT QUALCOMM WOULD HAVE A 

RIGHT TO DO IT IF THEY'RE IN DEFAULT. 

Q. OKAY. DO YOU RECALL TESTIFYING IN YOUR DEPOSITION THAT 

THE SUPPLY AGREEMENTS ARE ESSENTIALLY A FORM AGREEMENT? 

A. WELL, I MEAN, WE START WITH A FORM. BUT THEY -- YOU KNOW, 

THEY GET NEGOTIATED. 

Q. AND IS THAT -- DOES THE FORM AGREEMENT CONTAIN A SIMILAR 

PROVISION TO THE ONE WE'RE LOOKING AT RIGHT HERE? 

A. I BELIEVE SO, BECAUSE I THINK THIS IS THE FORM THAT YOU 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 111 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

271

SHOWED ME.

Q. THANK YOU. 

COULD WE PLEASE LOOK AT TAB 10, WHICH IS CX 6658. 

THE COURT: WAIT A MINUTE. ON JANUARY 6TH, 2019, I 

HAD SEALED VARIOUS PAGES OF JX 93, WHICH IS WHAT WE'RE TALKING 

ABOUT RIGHT NOW. 

SO I'M A LITTLE BIT UNCLEAR. DO YOU HAVE ECF 1135 IN 

FRONT OF YOU? 

MS. MILICI: I DO NOT. 

THE COURT: SO YOU'RE NOT CHECKING TO SEE IF YOU ARE 

APPROPRIATELY SEALING -- 

MS. MILICI: YOUR HONOR, I -- 

THE COURT: -- THIS AGREEMENT? YOU SAID -- 

MS. MILICI: YOUR HONOR, I BELIEVE THAT WE ARE. BUT 

I WAS NOT PERSONALLY DOING IT. 

THE COURT: OKAY. WELL, HAS ANYONE ON YOUR TEAM 

CHECKED ECF 1135 TO MAKE SURE YOU ARE NOT PUBLISHING PORTIONS 

THAT HAVE BEEN SEALED? 

MS. MILICI: I'M -- I -- I'M NOT SURE ABOUT THAT 

SPECIFIC ECF NUMBER. 

THE COURT: OKAY. WELL, IT LOOKS LIKE WHAT WAS 

GRANTED OF JX 93 WAS PORTIONS OF PAGES 18 THROUGH 20, 22 

THROUGH 23, 27 THROUGH 28, 31 THROUGH 35. 

AND I DON'T KNOW WHICH -- WELL, WHICH PAGE ARE YOU MOVING 

ONTO NOW? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 112 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

272

MS. MILICI: I WAS MOVING ONTO ANOTHER DOCUMENT. 

THE COURT: OKAY. 

MS. MILICI: MY QUESTIONS WERE ONLY ABOUT THE 

ATTACHED SUPPLY AGREEMENT, WHICH I DO NOT BELIEVE HAS EVER BEEN 

THE SUBJECT OF A SEALING MOTION. 

THE COURT: ALL RIGHT. IS IT PART OF JX 93? OR NOT? 

MS. MILICI: IT IS ATTACHED TO THE AGREEMENT IN 

JX 93, YES. 

THE COURT: WHAT'S THE BATES NUMBER? 

MS. MILICI: IT IS BB FTC 00075179. 

THE COURT: 75 -- WHAT'S THE JX 93 NUMBER? 

MS. MILICI: I'M SORRY. THAT IS THE JX 93 NUMBER. 

THE COURT: NO. YOU HAVE JX 93-056 OR -- 

MS. MILICI: OH, YOU MEAN THE PAGE NUMBER. 

THE COURT: THAT'S HOW THE SEALING WAS DONE. 

MS. MILICI: CERTAINLY. OKAY. IT WAS JX 116 ON. IT 

WAS JX 93-116 ONTO THE END OF THE DOCUMENT. 

THE COURT: OKAY. SO SEALING WAS GRANTED AS TO THE 

PORTIONS ON 114 AND 118 THROUGH 119. 

MS. MILICI: OKAY. THAT WAS OUR MISTAKE THEN. 

THE COURT: SO -- 

MS. MILICI: I DID NOT SHOW ANY OF THE -- I DID NOT 

SHOW THOSE PAGES ON THE SCREEN. 

THE COURT: OKAY. 

MS. MILICI: AND I APOLOGIZE TO THE COURT AND 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 113 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

273

CERTAINLY WILL BE MORE CAREFUL IN THE FUTURE. 

THE COURT: OKAY. GO AHEAD THEN. 

BY MS. MILICI: 

Q. CAN WE MOVE ON, PLEASE, TO TAB 10, WHICH IS CX 6658, AND 

CAN YOU IDENTIFY THIS AS A SERIES OF E-MAILS IN WHICH YOU 

PARTICIPATED IN APRIL 2011 REGARDING THE NEGOTIATIONS WITH ZTE? 

A. YES. 

Q. OKAY. 

YOUR HONOR, I MOVE TO ADMIT CX 6658. 

MR. BORNSTEIN: NO OBJECTION, YOUR HONOR. 

THE COURT: CX WHICH ONE AGAIN? 

MS. MILICI: 6658. 

THE COURT: 6658. OKAY. IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 6658 WAS ADMITTED IN EVIDENCE.) 

BY MS. MILICI: 

Q. OKAY. IF YOU COULD TURN TO PAGE 005, PLEASE. AND THERE'S 

AN E-MAIL ON THIS PAGE FROM DEREK ABERLE TO JING WANG AND 

OTHERS. 

DO YOU SEE THAT? 

A. YES. 

Q. AND YOU WROTE IN THAT E-MAIL TO JING WANG, "HERE ARE THE 

ITEMS I THINK YOU SHOULD FOCUS ON DURING YOUR MEETINGS WITH 

ZTE." 

DO YOU RECALL THAT? 

A. I MEAN, I GENERALLY REMEMBER THIS NEGOTIATION AND THIS 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 114 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

274

EXCHANGE. THAT'S WHAT THE E-MAIL SAYS, SO... 

Q. OKAY. AND UNDER SUBSCRIBER AGREEMENT, YOU WROTE, "NEEDS 

TO COVER CDMA 2000. WCDMA AND SINGLE-MODE OFDMA." 

DO YOU SEE THAT? 

A. YES.

Q. AND THAT WAS ONE OF THE POINTS THAT YOU TOLD JING WANG 

THAT YOU SHOULD TRY TO GET AGREEMENT ON; CORRECT? 

A. YES. 

Q. OKAY. AND THEN IN THE -- FURTHER DOWN IN THAT DOCUMENT IT 

REFERS TO A STRATEGIC FUND AGREEMENT. 

DO YOU SEE THAT? 

A. YES. 

Q. AND YOU WROTE THAT "STARTING IN THE QUARTER IN WHICH WE 

SIGN WE HAVE PROPOSED," AND YOU GIVE PERCENTAGES OF QCT CHIPSET 

PURCHASES. 

DO YOU SEE THAT? 

A. YES. 

Q. AND THEN YOU WROTE, "TO CLOSE THE DEAL, I WOULD BE WILLING 

TO INCREASE THE 2011 PERCENTAGE." 

DO YOU SEE THAT? 

A. YES. 

Q. AND THE DEAL THAT YOU WERE REFERRING TO THERE WAS THE 

LICENSE AGREEMENT; CORRECT? 

A. WELL, IT WAS A SERIES OF LICENSE AGREEMENTS, BOTH ON 

SUBSCRIBER AND INFRASTRUCTURE, AS WELL AS AUDIT DISPUTES AND A 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 115 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

275

NUMBER OF OTHER ISSUES BACK AND FORTH THAT WE WERE NEGOTIATING. 

Q. SO THE LICENSE AGREEMENT WAS ONE PART OF THE DEAL THAT YOU 

WERE WILLING TO CONSIDER INCREASING THE PERCENTAGE OF THE 

STRATEGIC FUND IN ORDER TO CLOSE; CORRECT? 

A. YEAH, THE LICENSE AGREEMENT WAS PART OF THE OVERALL 

PACKAGE THAT WE WERE DISCUSSING. 

Q. OKAY. AND YOU SUGGESTED ON THE NEXT PAGE, YOU -- IN THE 

SECOND TO LAST PARAGRAPH OF THIS E-MAIL YOU WROTE, "THEY SHOULD 

ALSO CONSIDER THE IMPACT ON THEIR BUSINESS IN THE U.S. (E.G., 

WITH VZW." 

IS THAT VERIZON? 

A. YES. 

Q. "IF WE ARE FORCED TO SUE THEM FOR PATENT INFRINGEMENT." 

AND THEN YOU WROTE, "FINALLY, THEY SHOULD BE REMINDED THAT 

WE DO NOT SUPPLY CHIPS TO COMPANIES THAT ARE NOT LICENSED." 

DO YOU SEE THAT?

A. YES.

Q. AND YOU WERE SUGGESTING THAT ZTE BE REMINDED OF THE 

POTENTIAL LOSS OF CHIP SUPPLY DURING THE NEGOTIATIONS OVER THE 

TERMS OF A NEW LICENSE; CORRECT? 

A. I THINK WHAT I WAS SAYING WAS THEY SHOULD BE REMINDED THAT 

THAT IS A POTENTIAL CONSEQUENCE IF WE CAN'T CONCLUDE A NEW 

LICENSE AGREEMENT. 

Q. OKAY. AND THE NEW LICENSE AGREEMENT THAT WAS UNDER 

DISCUSSION WAS ONE THAT WOULD APPLY TO CDMA, WCDMA, AND OFDMA; 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 116 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

276

CORRECT? 

A. YES, THAT WAS UNDER DISCUSSION. 

BUT I DON'T BELIEVE AT THIS TIME PERIOD THEY WERE BUYING 

ANY OFDMA OR 4G CHIPS. 

Q. COULD YOU PLEASE TURN TO TAB 11 IN YOUR BINDER. THAT'S 

CX 7105. 

AND CAN YOU IDENTIFY THIS AS AN E-MAIL EXCHANGE BETWEEN 

YOU AND A MR. LEE AND OTHERS IN JANUARY 2007 ABOUT LGE? 

AND, SIR, TO BE CLEAR, THESE ARE THE SAME DOCUMENTS THAT 

WE SENT TO YOUR COUNSEL TWO DAYS AGO. 

A. SO WAS YOUR QUESTION IS THIS AN E-MAIL EXCHANGE BETWEEN 

MYSELF AND OTHERS AND H.J. LEE?

Q. YES. 

A. YES. 

MS. MILICI: I MOVE TO ADMIT CX 7105. 

MR. BORNSTEIN: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 7105 WAS ADMITTED IN EVIDENCE.) 

THE COURT: LET ME JUST ASK, SO WHEN FTC HAS BEEN 

MOVING TO ADMIT DOCUMENTS, I'VE BEEN RELYING ON YOU TO LET ME 

KNOW, AND YOUR CO-COUNSEL, WHETHER ANY OF THESE DOCUMENTS HAVE 

BEEN SEALED. 

SO WHAT I'M HEARING FROM YOU IS YOU ALL ARE NOT PAYING 

ATTENTION TO THAT AND ARE NOT IDENTIFYING ANY DOCUMENT THAT'S 

BEEN SEALED WHEN YOU'RE MOVING TO ADMIT THEM; IS THAT RIGHT? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 117 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

277

MS. MILICI: I BELIEVE THAT WE HAVE BEEN. OBVIOUSLY 

WE MADE A MISTAKE ON THAT ONE DOCUMENT TODAY. BUT I DO THINK 

THAT IT HAS BEEN PART OF OUR PROCESS. 

THE COURT: OKAY. 

MS. MILICI: I'M SORRY AGAIN FOR THE MISTAKE ON THE 

OTHER DOCUMENT. 

THE COURT: OKAY. ALL RIGHT. GO AHEAD, PLEASE. 

BY MS. MILICI: 

Q. MR. LEE WAS SOMEONE WHO WORKS IN THE QUALCOMM KOREA 

OFFICE; IS THAT CORRECT? 

A. YES. 

Q. AND IN THE THIRD FULL PARAGRAPH ON 003, IN THE THIRD FULL 

PARAGRAPH OF AN E-MAIL FROM HIM ABOUT THE NEGOTIATION WITH LG 

HE WROTE, "THE CEO CLEARLY UNDERSTANDS THAT THE MAIN EXCHANGE 

ITEMS OF THIS DEAL ARE OFDMA VERSUS FUNDS." 

DO YOU SEE THAT? 

SIR, IT'S HIGHLIGHTED ON THE SCREEN. DO YOU SEE THAT? 

A. YEAH, I SEE IT.

Q. AND DO YOU AGREE THAT ONE OF THE MAIN EXCHANGE ITEMS IN A 

DEAL THAT WAS UNDER DISCUSSION AT THE TIME WAS LG TAKING AN 

OFDMA LICENSE AND QUALCOMM PROVIDING FUNDS? 

A. YEAH, THOSE WERE TWO IMPORTANT ELEMENTS OF THE OVERALL 

DEAL THAT WE WERE, THAT WE WERE DISCUSSING. 

Q. AND IF YOU LOOK AT PAGE 1, THERE'S AN E-MAIL FROM YOU, AND 

IT'S NOT CLEAR WHO IT'S TO, BUT IT'S IN THE MIDDLE OF PAGE. IT 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 118 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

278

SAYS AT 2:51 P.M. 

DO YOU SEE THAT? 

AND YOU WROTE, "I THINK TO GET THIS BACK ON TRACK, WE WILL 

NEED TO DO SOME CONVINCING -- SOME WORK CONVINCING LGE THAT 

THEY WILL NEED TO TAKE A SINGLE MODE LICENSE FROM US IN ANY 

EVENT AND THAT THE AMOUNT OF ROYALTIES THAT THEY WILL PAY TO US 

FOR SINGLE MODE OFDM PRODUCTS IS LIKELY TO BE SMALL FOR A 

NUMBER OF YEARS." 

DO YOU SEE THAT? 

A. YES.

Q. SO IN OTHER WORDS, QUALCOMM WAS WILLING TO PROVIDE FUNDS 

IN EXCHANGE FOR AN OFDM AGREEMENT THAT IT DID NOT EXPECT WOULD 

GENERATE ANY ROYALTIES FOR A NUMBER OF YEARS; IS THAT CORRECT? 

A. MY RECOLLECTION IS THAT THERE WERE A NUMBER OF ELEMENTS OF 

CONSIDERATION GOING BACK AND FORTH, ONE OF WHICH WAS QUALCOMM 

WAS TRYING TO ESTABLISH -- WE WERE TRYING TO ESTABLISH THE 4G 

LICENSING PROGRAM AT THAT TIME. SO THAT WAS AN IMPORTANT ASK 

FOR US IN THE DEAL. 

AND, YES, THERE WERE FUNDS AND OTHER CONSIDERATION GOING 

TO LG AS PART OF THAT.

Q. OKAY. WHEN YOU SAY "ESTABLISH THE 4G LICENSING PROGRAM," 

ARE YOU REFERRING TO THE FACT THAT LG WAS THE FIRST MAJOR 

MANUFACTURER TO TAKE A 4G LICENSE FROM QUALCOMM? 

A. AND JUST TO BE CLEAR, A 4G LICENSE IS SOMETHING THAT WOULD 

APPLY TO A PRODUCT THAT ONLY HAS 4G. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 119 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

279

Q. AND -- 

A. ALL OF THE 3G AGREEMENTS COVERED MULTI.

Q. AND LG WAS THE FIRST MAJOR COMPANY TO ACCEPT THAT LICENSE? 

A. I BELIEVE THAT IS CORRECT. 

Q. AND THE NEGOTIATION LEADING TO LG ACCEPTING SUCH A LICENSE 

INVOLVED THE PAYMENT OF SUBSTANTIAL STRATEGIC FUNDS TO LG; IS 

THAT CORRECT? 

A. THAT WAS ANOTHER ELEMENT OF THE DEAL.

Q. THANK YOU. 

A. BUT THERE WERE CONSIDERATIONS FOR THE MONEY THAT WAS PAID. 

Q. COULD WE PLEASE TURN TO TAB 12, WHICH IS CX 7556. 

AND CAN YOU IDENTIFY THIS AS AN ACCOUNTING MEMO PREPARED 

REGARDING THE LG STRATEGIC FUND AGREEMENT AND LICENSE? 

A. THAT'S WHAT IT LOOKS LIKE, YES. 

MS. MILICI: OKAY. THE FTC MOVES TO ADMIT CX 7556. 

MR. BORNSTEIN: NO OBJECTION, YOUR HONOR. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT 7556 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MS. MILICI: 

Q. AND YOU WERE INVOLVED IN NEGOTIATING THIS STRATEGIC FUND 

AS PART OF THIS MEMO AND IN THE LAST E-MAIL WE WERE DISCUSSING? 

A. I WAS INVOLVED IN NEGOTIATING THIS STRATEGIC FUND WITH LG, 

YES.

Q. OKAY. AND THE STRATEGIC FUND WAS USED AS A WAY TO 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 120 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

280

EXCHANGE VALUE WITH LG AS OPPOSED TO OFFERING A ROYALTY 

REDUCTION; CORRECT? 

A. NO. 

Q. SIR, DO YOU -- WAS LG SEEKING A LOWER ROYALTY RATE IN 

THESE NEGOTIATIONS? 

A. THEY WERE SEEKING LOWER ROYALTIES; THEY WERE SEEKING 

ADDITIONAL LICENSES FOR NEW PRODUCTS; THEY WERE SEEKING 

ADDITIONAL LICENSES FOR NEW PATENTS. 

THERE WAS A -- IT WAS A VERY LARGE SCOPE LICENSE 

NEGOTIATION. 

BUT THE FUNDS WERE NOT PAID FOR NOTHING. THERE WAS -- 

THERE WAS CONSIDERATION EXCHANGED IN TERMS OF -- 

Q. SIR. 

A. -- STRATEGIC ACTIVITY THAT WAS TAKING PLACE.

Q. CAN I ASK YOU TO LOOK AT YOUR DEPOSITION AT -- ACTUALLY, 

YOUR INVESTIGATIONAL HEARING AT PAGE 397:4 TO 18. 

A. COULD YOU GIVE ME THE PAGE NUMBERS AGAIN, PLEASE. 

Q. ACTUALLY, I'M GOING TO SKIP THAT JUST FOR TIME REASONS. 

THANK YOU. 

OKAY. IF WE LOOK BACK AT THE DOCUMENT, PLEASE, CX 6556, 

PAGE 004, AT THE TOP IN THE FIRST SUB BULLET, IT SAYS, "QC AND 

LGE ALSO ENTERED INTO AN OFDM SUBSCRIBER LICENSE." 

DO YOU SEE THAT? 

A. YES.

Q. AND THEN AT THE END OF THAT PARAGRAPH IT SAYS, "FROM AN 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 121 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

281

ACCOUNTING VIEWPOINT, THE STRATEGIC FUND CANNOT BE VIEWED 

INDEPENDENTLY OF THE AGREEMENT"? 

A. YES. 

Q. AND YOU REVIEWED ACCOUNT AGREEMENTS BEFORE THEY WERE 

FINAL, DIDN'T YOU? 

A. I DID FROM TIME TO TIME. I DON'T KNOW WHETHER I REVIEWED 

THIS ONE.

Q. THANK YOU. AND ON PAGE 005 IN THE LAST PARAGRAPH, IT 

SAYS, AT THE END, "QTL IS DEEMED TO BE THE PRIMARY BENEFICIARY 

OF THE ELEMENTS OF THOSE AGREEMENTS, INCLUDING THE EXPECTED 

ROYALTY STREAM RESULTING FROM QC'S FIRST OFDM SUBSCRIBER DEVICE 

LICENSE WITH A MAJOR HANDSET MANUFACTURER." 

DO YOU SEE THAT? 

A. YES.

Q. AND THEN IT CONCLUDES, "THE AMOUNTS UNDER THESE AGREEMENTS 

WILL BE RECORDED IN A QTL BUSINESS UNIT." 

DO YOU SEE THAT? 

A. YES.

Q. AND THE AMOUNTS THAT WERE BEING RECORDED IN THE QTL 

BUSINESS UNIT WERE BEING ACCRUED ON CHIP PURCHASES FROM QCT; 

CORRECT?

A. YOU'D HAVE TO REFRESH ME ON THAT. I'M NOT 100 PERCENT 

SURE ABOUT THAT.

I THINK THERE WERE CERTAIN PORTIONS OF IT THAT WERE 

CALCULATED THAT WAY. I JUST DON'T KNOW WHETHER ALL OF THE 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 122 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE DIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

282

FUNDS WERE CALCULATED THAT WAY.

Q. SIR, CAN YOU LOOK BACK AT PAGE 002 OF THIS DOCUMENT UNDER 

STRATEGIC FUND. 

DO YOU SEE THAT THE STRATEGIC FUND IS ACCRUING ON CHIPSET 

PURCHASES? 

A. YES. LIKE I SAID, I KNOW THAT PORTIONS OF IT ACCRUED THAT 

WAY. I JUST DON'T REMEMBER IF ALL OF IT -- 

Q. DOES IT REFER TO ANY FUND ACCRUING ON ANYTHING BESIDES 

CHIPSET PURCHASES? 

A. I THOUGHT THERE WAS AN INITIAL AMOUNT OF MONEY DEPOSITED 

INTO THE FUND THAT WAS JUST A FIXED AMOUNT. BUT I -- YOU'D 

HAVE TO SHOW ME THE AGREEMENT.

MS. MILICI: OKAY. THANK YOU, SIR. I HAVE NO MORE 

QUESTIONS. 

THE COURT: OKAY. TIME IS 1:33. 

(PAUSE IN PROCEEDINGS.) 

MR. BORNSTEIN: MAY MR. PETERSON APPROACH, YOUR 

HONOR? 

THE COURT: YES, PLEASE. SORRY, I CAN'T SEE HIM 

BEHIND. 

THE WITNESS: DONE WITH THESE FOR NOW (INDICATING)? 

MR. BORNSTEIN: KEEP THAT ONE. 

THE COURT: ALL RIGHT. ARE YOU READY, MR. BORNSTEIN? 

MR. BORNSTEIN: YES. THANK YOU, YOUR HONOR. THE 

WITNESS BINDER IS GOING UP TO THE WITNESS. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 123 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

283

THE COURT: OKAY. 1:34. GO AHEAD, PLEASE. 

CROSS-EXAMINATION

BY MR. BORNSTEIN: 

Q. GOOD AFTERNOON, MR. ABERLE. 

A. GOOD AFTERNOON.

Q. YOU WERE ASKED A NUMBER OF QUESTIONS ABOUT THE FTC'S 

COUNSEL ABOUT QUALCOMM'S PRACTICES NOT SELLING CHIPS UNLESS THE 

CUSTOMER HAS A LICENSE. 

DO YOU REMEMBER THAT SUBJECT? 

A. YES.

Q. ARE YOU FAMILIAR WITH CHINESE OEM'S CALLED OPPO AND VIVO? 

A. YES. 

Q. THEY'RE NOT GOING TO BE U.S. HOUSEHOLD NAMES, BUT WHO ARE 

THEY? 

A. WELL, THEY'RE STARTING TO BECOME A LITTLE MORE KNOWN IN 

THE U.S. 

THEY'RE LARGE HANDSET MANUFACTURERS THAT FIRST FOCUSSED 

THEIR BUSINESS IN CHINA, BUT NOW SELL MANY PLACES IN THE WORLD, 

AND I THINK THEY'RE AMONG THE TOP 10 HANDSET SUPPLIERS 

WORLDWIDE NOW. 

Q. AND WHEN YOU WERE AT THE COMPANY, WERE OPPO AND VIVO 

LICENSED BY QUALCOMM?

A. YES.

Q. WAS THERE A POINT IN TIME WHERE THERE WAS A DISPUTE ABOUT 

WHETHER THEY WERE ACTUALLY LICENSED BY QUALCOMM? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 124 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

284

A. YES.

Q. CAN YOU TELL ME WHAT THE DISPUTE WAS ABOUT? 

A. YEAH. WE HAD AN ANTITRUST INVESTIGATION BY THE CHINESE 

GOVERNMENT THAT WE RESOLVED SOMETIME IN I THINK MID-2015. AND 

AS PART OF THAT, WE COMMITTED TO BASICALLY GO OUT AND OFFER A 

SET OF NEW LICENSING TERMS FOR THE CHINA, CHINA MARKET TO ALL 

OF THE LICENSEES THAT WE HAD, INCLUDING OPPO AND VIVO. 

AND FROM OUR PERSPECTIVE, THEY BASICALLY HAD AN OPTION 

EITHER TO KEEP THEIR EXISTING AGREEMENT OR TO ACCEPT THE NEW 

TERMS. 

BUT THEY TOOK THE POSITION THAT AS A RESULT OF THE NDRC 

RESOLUTION, THAT THEIR AGREEMENT WAS NO LONGER IN EFFECT AND 

THEY EFFECTIVELY DIDN'T HAVE A LICENSE.

Q. AND WHEN WAS THIS, APPROXIMATELY? 

A. IT WAS SOMETIME IN MID-2015 I WOULD GUESS.

Q. AND DID THEY -- HOW DID THEY ACT IN TERMS OF THEIR -- WHAT 

DID THEY DO BECAUSE THEY CONCLUDED THAT THEY WERE NOT LICENSED? 

A. THEY BASICALLY STOPPED REPORTING AND PAYING ROYALTIES TO 

QUALCOMM ENTIRELY.

Q. OKAY. AND WHEN THEY STOPPED REPORTING AND PAYING 

ROYALTIES, DID QUALCOMM STOP SHIPPING THEM CHIPS? 

A. NO.

Q. OKAY. WHY NOT? 

A. I THINK THERE WERE A VARIETY OF REASONS FOR THAT. ONE IS 

THAT, YOU KNOW, ALTHOUGH THEY WERE DIFFICULT DISCUSSIONS, WE 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 125 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

285

BELIEVED THAT, YOU KNOW, WE WERE IN GOOD FAITH DISCUSSIONS AND 

WE WERE MAKING PROGRESS TOWARDS GETTING A NEW AGREEMENT IN 

PLACE. 

WE ALSO FELT VERY STRONGLY THAT THE LICENSES REMAINED 

VALID AND ENFORCEABLE, AND IF WE ULTIMATELY COULD NOT REACH AN 

AGREEMENT, WE WOULD BE ABLE TO COLLECT ROYALTIES UNDER, UNDER 

THE AGREEMENTS THAT EXISTED.

Q. DID YOU CONSIDER THERE TO BE ANY RISK TO QUALCOMM FROM 

CONTINUING TO SHIP CHIPS TO OPPO AND VIVO WHILE THEY WERE 

REFUSING TO REPORT AND PAY? 

A. YES. IT WAS NOT AN EASY DECISION FOR US BECAUSE THEY WERE 

TAKING A VERY AGGRESSIVE POSITION. AND, IN FACT, MY 

RECOLLECTION IS THAT AS PART OF THE RESOLUTION WITH THE CHINESE 

GOVERNMENT, THE CHINESE GOVERNMENT SAID IF LICENSEES REFUSE TO 

REPORT AND PAY, YOU CAN CEASE SUPPLYING CHIPS TO THEM. 

SO THEY HAD EFFECTIVELY ALREADY GIVEN US, YOU KNOW, THE 

GREEN LIGHT TO DO THAT, AND WE DECIDED NOT TO DO IT.

Q. DID OPPO AND VIVO'S FAILURE TO REPORT AND PAY UNDER THEIR 

AGREEMENT HAVE ANY IMPACT ON YOUR RELATIONSHIP WITH OTHER 

CHINESE LICENSEES? 

A. YES. 

Q. HOW SO? 

A. THERE WERE STILL COMPANIES WE WERE NEGOTIATING WITH, BUT 

THERE WERE A NUMBER OF COMPANIES THAT PRETTY QUICKLY SIGNED NEW 

AGREEMENTS AFTER THE NDRC RESOLUTION, KIND OF CONSISTENT WITH 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 126 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

286

THE INTENT OF THAT, AND THEY WERE PAYING, CONTINUED TO PAY AND 

BE GOOD LICENSEES. AND THEY WERE ASKING, WHY ARE YOU 

CONTINUING TO SUPPORT OPPO AND VIVO AND THEY'RE NOT COMPLYING 

WITH THEIR AGREEMENTS. 

Q. AND HOW DID YOU RESPOND TO THAT?

A. WE BASICALLY -- I MEAN, IT WAS A DIFFICULT SITUATION. WE 

WERE TRYING TO BALANCE THE INTERESTS ON BOTH SIDES. AND, YOU 

KNOW, WE TOLD THEM THAT WE BELIEVED WE WERE MAKING PROGRESS IN 

THE DISCUSSIONS AND WE'RE GOING TO GET TO AN AGREEMENT, AND 

ONCE THERE'S A NEW AGREEMENT, THEY'LL OWE THE ROYALTIES FOR THE 

PAST AS WELL.

Q. DID YOU ULTIMATELY SIGN ANY LICENSE AGREEMENTS WITH OPPO 

AND VIVO WHILE YOU WERE STILL AT THE COMPANY? 

A. YES.

Q. ABOUT HOW LONG DID THIS PERIOD OF NONREPORTING AND 

NONPAYMENT GO ON WITH EACH OF THEM? 

A. SOMEWHERE AROUND A YEAR, MAYBE A LITTLE BIT MORE THAN 

THAT.

Q. OKAY. AND AT ANY POINT DURING THE COURSE OF THAT 

APPROXIMATELY ONE YEAR, DID QUALCOMM INDICATE TO OPPO AND VIVO 

THAT THEY WERE GOING TO STOP THE SUPPLY OF CHIPS? 

A. I DON'T BELIEVE SO, NO. 

Q. WAS THERE EVER A DISPUTE THAT QUALCOMM HAD WITH BLACKBERRY 

UNDER WHICH BLACKBERRY WAS NOT PAYING THE FULL ROYALTIES THAT 

IT WAS DUE UNDER ITS AGREEMENT? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 127 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

287

A. YES. 

Q. CAN YOU DESCRIBE WHAT THAT SITUATION WAS? 

A. I DON'T REMEMBER SPECIFICALLY THE DATE, BUT MAYBE IT WAS 

AROUND 2009-ISH, 2008. THEY BASICALLY TOOK THE POSITION THAT 

THEIR AGREEMENT DID NOT COVER WCDMA, WHICH IS ONE OF THE FORMS 

OF 3G, AND INSTEAD OF PAYING THE FULL ROYALTY THAT WE BELIEVED 

WAS OWED UNDER THE AGREEMENT, THEY KIND OF UNILATERALLY STARTED 

PAYING LESS AND CONTINUED TO TAKE THE POSITION THAT THE 

LICENSE -- THAT THEY WERE UNLICENSED FOR WCDMA PRODUCTS.

Q. AND TO TRY TO AVOID ANY CONFIDENTIALITY ISSUES HERE, I'M 

GOING TO ASK YOU NOT TO SAY A SPECIFIC ROYALTY RATE, BUT DO 

HAVE A SENSE OF ORDER OF MAGNITUDE OF HOW MUCH LESS THEY WERE 

PAYING THAN WHAT WAS DUE TO QUALCOMM? 

A. I THINK IT WAS LESS THAN HALF. 

Q. OKAY. DID QUALCOMM CONTINUE SHIPPING CHIPS TO BLACKBERRY 

WHILE IT WAS PAYING LESS THAN HALF OF WHAT IT OWED UNDER THE 

AGREEMENT? 

A. YES, WE DID.

Q. OKAY. AND DID YOU ULTIMATELY REACH AN AGREEMENT WITH 

BLACKBERRY? 

A. YES. IT TOOK QUITE A WHILE TO NEGOTIATE THAT, BUT I THINK 

EVENTUALLY WE DID REACH AN AGREEMENT.

Q. AND AT ANY POINT DURING THAT NEGOTIATION, DID QUALCOMM 

INDICATE TO BLACKBERRY THAT IT WOULD CEASE SUPPLYING CHIPS 

BECAUSE OF ITS FAILURE TO PAY FULL ROYALTIES? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 128 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

288

A. NO.

Q. AND WAS THE AGREEMENT THAT QUALCOMM REACHED AT THE END OF 

THIS NEGOTIATION WITH BLACKBERRY AN AGREEMENT ON QUALCOMM'S 

TYPICAL ROYALTY TERMS? 

A. NO. I THINK IT WAS -- THE AGREEMENT ACTUALLY THAT WAS 

JUST SHOWN TO ME, IT WAS QUITE DIFFERENT THAN WHAT WE WOULD 

CONSIDER OUR TYPICAL AGREEMENT. 

Q. OKAY. AND FOR THE RECORD, YOU'RE REFERRING TO JX 0093, I 

BELIEVE, IN THE BINDER THAT THE FTC GAVE YOU? 

A. YES. 

Q. AND WITHOUT, AGAIN, GETTING INTO DETAILS, COULD YOU SPEAK 

AT A HIGH LEVEL ABOUT HOW THAT AGREEMENT WAS DIFFERENT FROM A 

TYPICAL AGREEMENT? 

A. YEAH. I MEAN, WE COULDN'T REACH AN AGREEMENT EFFECTIVELY 

ON, ON WHAT THE RUNNING ROYALTY STRUCTURE SHOULD BE, AND SO WE 

CAME UP WITH A COMPROMISE, WHICH WAS VERY DIFFERENT THAN WE HAD 

DONE WITH ANYBODY ELSE, WHERE EFFECTIVELY THEY PREPAID THE 

ROYALTIES FOR THE RIGHT TO SELL A CERTAIN NUMBER OF UNITS 

WITHIN A TIME PERIOD. 

Q. OKAY. 

A. AND SO, YOU KNOW, THE IDEA WAS THAT IF A -- IF THEY SOLD 

ALL OF THOSE UNITS, THAT WOULD BE BETTER THAN WHAT THEY HAD IN 

THE ORIGINAL AGREEMENT. 

BUT IF THEY DIDN'T SELL AS MANY UNITS, IT POTENTIALLY 

COULD BE BETTER FOR QUALCOMM. SO THERE WAS SORT OF A RISK 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 129 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

289

SHARING APPROACH TO IT. 

Q. HAVE THERE BEEN LICENSEES WHO HAVE COME TO QUALCOMM TO 

SEEK TO RENEGOTIATE THEIR AGREEMENTS BEFORE AN EXPIRATION OR 

TERMINATION OF THE EXISTING CONTRACT? 

A. YEAH, THAT WAS FAIRLY FREQUENT.

Q. OKAY. IS QUALCOMM'S PRACTICE, WHICH LICENSEES SEEK TO 

RENEGOTIATE, TO TELL THEM THAT QUALCOMM WILL NOT, UNDER ANY 

CIRCUMSTANCES, RENEGOTIATE THEIR DEAL? 

A. NO. 

Q. IS QUALCOMM'S PRACTICE TO TELL LICENSEES WHO SEEK TO 

RENEGOTIATE AN EXISTING AGREEMENT, THAT QUALCOMM WILL SHUT OFF 

THE SUPPLY OF CHIPS TO THOSE LICENSEES IF THEY WISH TO 

RENEGOTIATE? 

A. NO.

Q. WHAT DOES -- WHAT DOES QUALCOMM, IN FACT, DO WHEN IT 

RECEIVES A REQUEST FROM AN EXISTING LICENSEE TO RENEGOTIATE? 

A. YOU KNOW, OUR TYPICAL PRACTICE IS WE WOULD ENTER INTO 

DISCUSSIONS AND NEGOTIATE IN GOOD FAITH. WE WOULD TRY TO 

UNDERSTAND WHAT CONCERNS THEY HAD ABOUT THEIR EXISTING 

AGREEMENT. 

OFTENTIMES MAYBE THERE WERE NEW PRODUCTS THEY WERE GOING 

TO BRING TO MARKET AND THEY WERE TELLING US THAT THE EXISTING 

ROYALTY STRUCTURE DID NOT FIT WELL WITH THESE NEW PRODUCTS THAT 

MAYBE THEY DIDN'T CONTEMPLATE WHEN THEY SIGNED THE AGREEMENT. 

SOMETIMES WE WOULD HAVE, YOU KNOW, GO IN AND AUDIT TO MAKE 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 130 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

290

SURE WE WERE GETTING PAID ROYALTIES. ISSUES WOULD ARISE ABOUT 

THE TERMS OF THE AGREEMENT. WE WOULD NEGOTIATE THOSE. THAT 

WAS VERY FREQUENT. 

SO THERE ARE A NUMBER OF DIFFERENT TIMES AND REASONS WE 

WOULD RENEGOTIATE A LICENSE.

Q. IS SAMSUNG ONE OF THE COMPANIES THAT HAS SOUGHT TO 

RENEGOTIATE ITS AGREEMENT WITH QUALCOMM? 

A. MANY TIMES.

Q. DID IT DO THAT IN 2008? 

A. YES.

Q. AND WHO RAISED THE PROSPECT OF NEGOTIATIONS, SAMSUNG OR 

QUALCOMM? 

A. I BELIEVE SAMSUNG RAISED IT INITIALLY. 

Q. AND DID QUALCOMM RESPOND BY THREATENING TO CUT OFF THE 

SUPPLY OF CHIPS TO SAMSUNG? 

A. NO. 

Q. DID YOU PARTICIPATE IN NEGOTIATIONS WITH SAMSUNG IN 

RESPONSE TO THIS REQUEST IN 2008? 

A. YES. 

Q. AND AT THIS POINT IN TIME WAS SAMSUNG'S LICENSE DUE TO 

EXPIRE AT ANY POINT IN THE NEAR FUTURE? 

A. NO. 

Q. WAS SAMSUNG LICENSED AT THAT POINT FOR CDMA PRODUCTS? 

A. YES. 

Q. AND WAS SAMSUNG LICENSED AT THAT POINT FOR WCDMA PRODUCTS? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 131 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

291

A. YES. 

Q. WAS SAMSUNG GENERALLY COMPLYING WITH ITS AGREEMENT AND 

PAYING THE ROYALTIES THAT WERE DUE? 

A. YEAH. LIKE I SAID, WE WOULD TYPICALLY HAVE ISSUES ARISE 

AROUND AUDITS AND DEDUCTIONS AND THINGS LIKE THAT. BUT THEY 

WERE GENERALLY IN COMPLIANCE WITH THEIR AGREEMENT.

Q. AND WAS QUALCOMM'S WILLINGNESS TO SELL MODEM CHIPS TO 

SAMSUNG AT THIS POINT IN TIME IN ANY WAY IN QUESTION? 

A. I DON'T BELIEVE SO, NO.

Q. OKAY. DID THE SUBJECT OF CHIP SUPPLY, CONTINUED CHIP 

SUPPLY TO SAMSUNG, COME UP DURING THESE NEGOTIATIONS? 

A. I THINK TO MY RECOLLECTION, ONLY ONE TIME AT THE, SORT OF 

AT THE OUTSET.

Q. OKAY. LET ME ASK YOU TO LOOK -- IT'S IN THE BINDER THAT 

WE HANDED YOU -- QX 9210. 

AND CAN YOU IDENTIFY THIS DOCUMENT FOR US, PLEASE? 

A. IT'S AN E-MAIL EXCHANGE BETWEEN MYSELF AND ONE OF THE 

SAMSUNG NEGOTIATORS. 

MR. BORNSTEIN: YOUR HONOR, I'D MOVE QX 9210 INTO 

EVIDENCE, YOUR HONOR. 

MS. MILICI: NO OBJECTION. 

THE COURT: I'M SORRY. I COULDN'T HEAR YOU. 

MS. MILICI: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(DEFENDANT'S EXHIBIT QX 9210 WAS ADMITTED IN EVIDENCE.) 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 132 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

292

THE COURT: GO AHEAD, PLEASE. 

MR. BORNSTEIN: THANK YOU. 

Q. IF YOU TURN TO THE BACK OF THE DOCUMENT, I'M LOOKING AT 

THE PAGE BATES STAMPED 6150 IN THE BOTTOM RIGHT CORNER. 

AND THERE'S AN E-MAIL HERE THAT AT THE TOP IS FROM YOU TO 

THIS GENTLEMAN AT SAMSUNG; CORRECT? 

A. YES. 

Q. OKAY. AND IT LOOKS LIKE YOU ARE RESPONDING TO SOMETHING 

THAT HE WROTE TO YOU; IS THAT RIGHT? 

A. YES. 

Q. OKAY. AND DID YOU GO THROUGH AND PUT YOUR RESPONSES TO 

WHAT HE ASKED YOU IN THE TEXT OF HIS E-MAIL? 

A. YEAH. WHERE IT INDICATES QC RESPONSE, THAT WAS OUR 

RESPONSE. THAT WAS MY RESPONSE.

Q. OKAY. SO CAN I ASK YOU TO TURN TO THE LAST PAGE OF THE 

EXHIBIT AND WHERE THERE'S A NUMERAL 4. AND THIS IS THE SAMSUNG 

PERSON WRITING TO YOU. IT SAYS, "THE NEGOTIATION PROCESS WILL 

NOT IN ANY WAY ADVERSELY AFFECT QUALCOMM'S CHIPSET SUPPLY AND 

TECHNICAL SUPPORT TO SAMSUNG." 

DO YOU SEE THAT? 

A. YES. 

Q. AND WHAT WAS YOUR RESPONSE TO HIM? 

A. WELL, IT'S RIGHT HERE IN THE DOCUMENT. DO YOU WANT ME TO 

READ IT?

Q. WELL, DID YOU TELL HIM THAT THERE WAS A RISK THAT YOU 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 133 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

293

ACTUALLY WOULD CUT OFF CHIP SUPPLY IF YOU COULDN'T REACH AN 

AGREEMENT? 

A. NO. I SAID THE OPPOSITE. 

Q. AFTER YOU WROTE THIS E-MAIL AND SAID WHAT'S HERE, DID YOU 

GET A RESPONSE FROM SAMSUNG OF ANY SORT ASKING FOR MORE 

INFORMATION OR CLARIFICATION ABOUT YOUR POSITION? 

A. I DON'T BELIEVE SO. I THINK THAT WAS THE ONLY EXCHANGE ON 

THAT, ON THAT ISSUE THAT WE HAD. 

Q. DID ANYBODY RAISE IT ORALLY OR IN WRITING AT ALL TO SAY, 

YOU HAVEN'T GIVEN US A CLEAR ENOUGH ASSURANCE? 

A. NO.

Q. DID SAMSUNG CONTINUE TO RECEIVE CHIPS FROM QUALCOMM DURING 

THE COURSE OF THIS NEGOTIATION? 

A. YEAH, AND I BELIEVE THE NEGOTIATION LASTED, LIKE, TWO 

YEARS. 

Q. AND WAS THE AGREEMENT THAT WAS SIGNED AT THE END OF THAT 

NEGOTIATION A TYPICAL QUALCOMM LICENSING TERMS AGREEMENT? OR 

WAS IT HIGHLY NEGOTIATED AND INDIVIDUALIZED? 

A. THE LATTER.

Q. OKAY. LET ME ASK YOU TO TAKE A LOOK, SIR, AT A DIFFERENT 

DOCUMENT IN THE BINDER THAT WE GAVE YOU. IT'S QX 9212. 

AND CAN YOU IDENTIFY THIS DOCUMENT FOR US, PLEASE? 

A. WELL, THE FIRST PART OF IT IS AN EXCHANGE BETWEEN MYSELF 

AND BRUCE SEWELL, WHO USED TO BE THE GENERAL COUNSEL AT APPLE. 

AND THEN IT LOOKS LIKE I FORWARDED IT ON INTERNALLY TO A FEW 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 134 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

294

PEOPLE. 

MR. BORNSTEIN: YOUR HONOR, I'D MOVE THE ADMISSION OF 

QX 9212. 

MS. MILICI: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(DEFENDANT'S EXHIBIT 9212 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. BORNSTEIN:

Q. CAN YOU EXPLAIN, MR. ABERLE, IN WHICH THE CONTEXT WAS IN 

WHICH YOU WERE CORRESPONDING WITH MR. SEWELL OF APPLE HERE? 

A. SO I THINK THE CONTEXT WAS, YOU KNOW, APPLE AND QUALCOMM 

KNEW THAT WE HAD DIFFERENT VIEWS ON THE AMOUNT OF ROYALTIES 

THAT SHOULD BE PAID TO QUALCOMM ON APPLE PRODUCTS. 

AT THE SAME TIME, YOU KNOW, WE HAD A VERY EXTENSIVE SUPPLY 

RELATIONSHIP BETWEEN THE TWO COMPANIES. 

AND SO WE KIND OF KNEW THAT THERE MAY BE A SITUATION 

BREWING WHERE WE END UP IN A DISPUTE OVER LICENSING, BUT WE 

WANTED TO TRY TO NEGOTIATE AN AGREEMENT THAT WOULD GIVE AN 

ASSURANCE OF SUPPLY TO APPLE EVEN IF SUCH DISPUTE WAS ONGOING. 

AND WHEN WE STARTED, ONE OF THE BASIC PREMISES WAS, ALL 

RIGHT, WE'RE GOING TO TRY TO COME UP WITH AN AGREEMENT THAT 

DOESN'T ADVANTAGE OR DISADVANTAGE EITHER SIDE IN THE EVENT OF A 

LICENSING DISPUTE. 

AND SO WE SPENT A LOT OF TIME TRYING TO GET TO -- TO GET 

TO THAT PLACE. AND IT LOOKS LIKE THIS WAS ONE OF THE LATER 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 135 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

295

ISSUES THAT WE WERE TRYING TO RESOLVE. 

Q. WELL, WHY WOULD A, AN ASSURANCE OF SUPPLY FROM QUALCOMM TO 

APPLE, OR APPLE'S MANUFACTURERS, HAVE THE POTENTIAL TO PUT 

QUALCOMM IN A WORSE POSITION THAN IT OTHERWISE WOULD BE IN? 

A. WELL, I MEAN, THAT'S WHAT WE WERE TRYING TO AVOID WITH 

THIS AGREEMENT. 

WHAT APPLE ORIGINALLY ASKED FOR WAS JUST SORT OF A BLANKET 

COMMITMENT THAT QUALCOMM WOULD CONTINUE TO SUPPLY CHIPS, I 

THINK IT WAS FOR THREE YEARS, YOU KNOW, AT THE EXISTING PRICING 

THAT HAD BEEN AGREED, EVEN IF THE CONTRACT MANUFACTURERS 

STOPPED PAYING ROYALTIES OR SOUGHT TO TERMINATE THEIR AGREEMENT 

OR CHALLENGE THE AGREEMENTS. 

AND WE THOUGHT THAT WOULD ACTUALLY PUT QUALCOMM IN A WORSE 

POSITION BECAUSE AT THE SAME TIME APPLE WANTED TO PRESERVE THE 

ABILITY TO ARGUE THAT QUALCOMM'S CONTINUED SHIPMENT OF CHIPS 

UNDER THAT SUPPLY COMMITMENT WOULD EXHAUST THE QUALCOMM PATENT 

PORTFOLIO, AND, THEREFORE, THEY COULD AVOID PAYING ROYALTIES.

Q. SO LET ME DIRECT YOU TO THE BOTTOM OF THE FIRST PAGE OF 

THE EXHIBIT. IT'S 6680. 

AND THE BOTTOM PARAGRAPH THERE YOU WROTE THAT "IN OTHER 

WORDS, THIS IS NOT AN ARGUMENT ABOUT THE VALUE OF QUALCOMM'S 

PATENTS, BUT RATHER AN ARGUMENT ABOUT WHETHER QUALCOMM SHOULD 

RECEIVE LESS THAN THE VALUE OF ITS PATENTS IN TERMS OF 

ROYALTIES BECAUSE IT HAS AGREED TO THE SUPPLY ASSURANCE TERMS 

QUALCOMM -- APPLE IS REQUESTING." 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 136 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

296

DO YOU SEE THAT? 

A. YES.

Q. CAN YOU EXPLAIN WHAT YOU MEANT BY THAT? 

A. YEAH. I THINK WHAT WE WERE, WHAT WE WERE TRYING TO CONEY 

IS, YOU KNOW, IF QUALCOMM WAS NOT SELLING ANY CHIPS TO APPLE 

AND WE HAD A DISPUTE OVER THE VALUE OF THE INTELLECTUAL 

PROPERTY, THEN THAT WOULD GET DECIDED AS TO WHAT THE 

APPROPRIATE VALUE IS, AND WE WERE PERFECTLY WILLING AND HAPPY 

TO ENGAGE IN THAT DISCUSSION OR HAVE THAT DETERMINATION MADE. 

FOR EXAMPLE, IF THEY WERE BUYING FROM INTEL, THEY WOULD 

HAVE NO ARGUMENT THAT THEY WOULD GET RIGHTS TO QUALCOMM PATENTS 

WHEN THEY BUY THE CHIPS. 

BUT THE WAY THAT THEY WERE SETTING UP THE SUPPLY TERM, 

THEY WERE PUTTING THEMSELVES IN A POSITION, FROM OUR 

PERSPECTIVE, TO ARGUE IF WE BUY FROM QUALCOMM, THAT WE, IN 

FACT, DO GET, YOU KNOW, A CHUNK OF THE QUALCOMM PORTFOLIO 

EFFECTIVELY FOR FREE BECAUSE THE PRICING OF THE CHIPS THAT HAD 

BEEN AGREED SPECIFICALLY DID NOT INCLUDE ANY VALUE FOR THE 

PATENTS.

Q. AND SO AT THE END OF THAT PARAGRAPH WHEN YOU SAY "SO WE 

THINK IT IS UNFAIR FOR APPLE TO LOCK IN PRICING THAT EXPRESSLY 

EXCLUDES THE VALUE OF QUALCOMM IPR AND THEN OBTAIN A WINDFALL 

IF IT SUCCEEDS IN ATTACKING THE FOUNDATION OF THAT PRICING," IS 

THAT THE DYNAMIC YOU'RE TALKING ABOUT? 

A. YEAH. SO EFFECTIVELY WE WERE SAYING IF THIS HAPPENS, WE 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 137 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

297

HAVE TO TALK ABOUT PRICING. WE HAVE TO HAVE A NEW DISCUSSION 

AROUND PRICING FOR THE CHIPS, WHICH IS WHAT THEY DIDN'T WANT TO 

DO. 

Q. YOU WERE ASKED SOME QUESTIONS BY COUNSEL FOR THE FTC ABOUT 

A STRATEGIC FUND WITH LG. 

DO YOU RECALL THAT? 

A. YES.

Q. WHAT WAS THE CONSIDERATION THAT YOU HAD SAID A COUPLE OF 

TIMES DURING THE FTC'S COUNSEL'S EXAMINATION, WHAT WAS THE 

CONSIDERATION THAT QUALCOMM FELT THAT IT RECEIVED FOR THE 

STRATEGIC FUND WHICH YOU DIDN'T GET A CHANCE TO EXPLAIN? 

A. SO THE WAY THE STRATEGIC FUND WAS STRUCTURED WAS BASICALLY 

QUALCOMM AGREED TO CONTRIBUTE DOLLARS TO A FUND THAT WOULD BE 

USED TO CO-INVEST WITH LG. SO THEY HAD TO PUT AN EQUAL AMOUNT 

OF MONEY UP TO FUND WHAT WE REFERRED TO AS STRATEGIC 

INITIATIVES THAT WOULD BE MUTUALLY BENEFICIAL TO THE COMPANIES. 

AND AT THE OUTSET WE IDENTIFIED A FEW. AND THEN WE HAD A 

PROCESS THAT WAS PUT IN PLACE WHERE REPRESENTATIVES FROM THE 

COMPANY MET QUARTERLY, THEY DISCUSSED POTENTIAL INITIATIVES, 

THEY AGREED ON THEM, THEY TALKED ABOUT HOW MUCH FUNDING WOULD 

BE COMMITTED, AND, YOU KNOW, THAT PROCESS WENT ON FOR MANY 

YEARS UNDER THE AGREEMENT. 

Q. AND LET ME DIRECT YOU TO AN E-MAIL -- EXCUSE ME -- THAT 

COUNSEL FOR THE FTC SHOWED YOU. IT'S IN THEIR BINDER, I THINK 

IT'S TAB 11, CX 7105 WHICH IS IN EVIDENCE. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 138 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

298

DO YOU HAVE THAT DOCUMENT? 

A. 7105?

Q. YES. 

A. YES. 

Q. OKAY. AT THE VERY BOTTOM OF THE DOCUMENT ON THE FIRST 

PAGE YOU SAY, "RATHER THAN GIVE ANY ADDITIONAL MONEY, I THINK 

WE SHOULD AGREE TO REDUCE THE OFDM RATE SLIGHTLY (MAYBE TO 4 

PERCENT), LOWER THE CAP AND LOOK AT FURTHER STRENGTHENING THE 

MFR FOR OFDM." 

LET ME TRY NOT TO WADE INTO ALL OF THE INITIALS HERE, BUT 

WHAT DID YOU MEAN WHEN YOU TALKED ABOUT "RATHER THAN GIVE ANY 

ADDITIONAL MONEY, I THINK WE SHOULD AGREE TO REDUCE THE OFDM 

RATE"? 

A. WELL, AGAIN, MY RECOLLECTION IS WE WERE NEGOTIATING A 

NUMBER OF DIFFERENT TERMS, BOTH IN EXISTING LICENSE AGREEMENT, 

THIS NEW OFDM AGREEMENT, THE STRATEGIC FUND. I BELIEVE THERE 

WERE SOME AUDIT CLAIMS. 

SO BOTH SIDES WERE POSITIONING FOR WHAT VALUE WAS COMING 

EACH WAY.

Q. SO AT THE OUTSET OF THIS NEGOTIATION, WAS QUALCOMM AT 4 

PERCENT OR WAS IT AT A HIGHER NUMBER FOR THE OFDM RATE? 

A. I THINK WE WERE AT A HIGHER NUMBER.

Q. SO WHY DID YOU COME DOWN TO A LOWER NUMBER DURING THE 

NEGOTIATION? 

A. IT WAS A CONCESSION WE DECIDED TO MAKE TO TRY TO GET THE 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 139 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

299

AGREEMENT DONE. 

Q. HAVE YOU EVER BEEN INVOLVED IN DISCUSSIONS WITH SAMSUNG 

OVER A LICENSE AT THE CHIP LEVEL? 

A. YES. 

Q. OKAY. AND HOW DID THOSE DISCUSSIONS START? 

A. WELL, ACTUALLY, THE DISCUSSIONS WEREN'T OVER A LICENSE.

Q. OKAY. 

A. THEY WERE -- THEY WERE -- IT WAS A REQUEST THAT CAME IN 

FROM SAMSUNG THAT THEY WANTED TO BASICALLY NEGOTIATE A 

NON-EXHAUSTIVE PATENT AGREEMENT BETWEEN THE COMPANIES COVERING 

THEIR MODEM CHIPS. 

Q. AND WAS QUALCOMM WILLING TO NEGOTIATE SUCH AN AGREEMENT? 

A. YES. 

Q. DID YOU ULTIMATELY REACH AN AGREEMENT WITH SAMSUNG ON CHIP 

LEVEL TERMS? 

A. NO, WE WERE NOT ABLE TO REACH AN AGREEMENT.

Q. WHILE YOU WERE AT THE COMPANY? 

A. CORRECT. 

Q. WHY DID YOU NOT REACH A DEAL DURING THESE NEGOTIATIONS? 

A. WELL, I MEAN, THE MAIN REASON WAS WE PROPOSED A STRUCTURE 

THAT WE BELIEVED WOULD IMPLEMENT THE PARTIES' INTENT TO HAVE A 

NON-EXHAUSTIVE PATENT AGREEMENT, AND, YOU KNOW, ONE OF THE 

ISSUES WITH NEGOTIATING AND IMPLEMENTING THAT IS THAT THE 

UNDERLYING CASE LAW IN THE U.S. AND OTHER PLACES WAS EVOLVING. 

AND SO, YOU KNOW, WE HAD TO CHANGE THE STRUCTURE WE USED 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 140 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

300

SEVERAL TIMES. 

AND HALFWAY THROUGH, OR ACTUALLY PROBABLY TOWARDS THE 

LATER STAGES OF THE NEGOTIATIONS WITH SAMSUNG THERE WAS A CASE 

THAT CAME DOWN IN THE U.S. SOMEWHERE, I DON'T REMEMBER WHERE, 

THAT CAUSED US TO BECOME CONCERNED THAT THE STRUCTURE WE WERE 

PROPOSING TO THEM ACTUALLY WOULD NOT HOLD UP AND BE 

NON-EXHAUSTIVE. 

SO WE HAD TO GO BACK AND THINK OF A DIFFERENT APPROACH IN 

LIGHT OF THE NEW CASE TO TRY TO IMPLEMENT WHAT THE PARTIES WERE 

TRYING TO ACHIEVE.

Q. AND WHEN YOU DID THAT, WHAT WAS SAMSUNG'S REACTION? 

A. I THINK THEY -- YOU KNOW, WE HAD SPENT A LOT OF TIME ON 

THE OTHER STRUCTURE AND -- YOU KNOW, I SHOULD HAVE MENTIONED AT 

THE BEGINNING THAT THIS ISSUE CAME UP FROM THEIR SIDE BECAUSE 

THEIR MANAGEMENT TEAM HAD KIND OF MISINTERPRETED SOME 

STATEMENTS IN THE PRESS THINKING THAT WE WERE OUT GRANTING 

THESE TYPES OF AGREEMENTS ROUTINELY. 

AND I THINK THE I.P. DEPARTMENT ACTUALLY KNEW THEY DIDN'T 

NEED IT, BUT HAVING SPENT THIS MUCH TIME ON IT, I THINK THEY 

DIDN'T WANT TO INVEST MORE RESOURCES AND THEN TRY AND NEGOTIATE 

A NEW STRUCTURE THE NEXT TIME AROUND. 

AND THERE WERE ELEMENTS IN THE ORIGINAL 2009/2010 

AGREEMENT WHICH BASICALLY GAVE THEM, YOU KNOW, PROTECTIONS 

AGAINST US ASSERTING AGAINST THEIR CHIP BUSINESS ANYWAY. SO I 

THINK THEY JUST SAID, YOU KNOW, THAT'S SUFFICIENT.

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 141 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

301

Q. OKAY. DID YOU EVER SAY TO SAMSUNG, HEY, GUYS, YOU REALLY 

DON'T NEED THIS AGREEMENT? 

A. YES.

Q. TO WHOM DID YOU SAY THAT? 

A. I THINK IT WAS INJUNG LEE. HE WAS THE ONE THAT REACHED 

OUT TO ME INITIALLY AND EXPLAINED HIS MANAGEMENT TEAM WAS KIND 

OF PUSHING FOR THIS. 

Q. LET ME TURN TO THE END OF THESE NEGOTIATIONS AND ASK YOU 

TO LOOK AT QX 9214 AND PLEASE IDENTIFY THAT. IT'S IN THE 

BINDER THAT WE GAVE YOU. 

A. YES. IT LOOKS LIKE AN E-MAIL BETWEEN MYSELF AND DR. AHN 

AT SAMSUNG. 

MR. BORNSTEIN: OKAY. YOUR HONOR, I MOVE THE 

ADMISSION OF QX 9214, PLEASE. 

MS. MILICI: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(DEFENDANT'S EXHIBIT QX 9214 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. BORNSTEIN:

Q. CAN YOU EXPLAIN THE PURPOSE OF YOUR E-MAIL TO DR. AHN 

HERE. 

A. YEAH. I THINK -- SO I THINK THIS WAS AFTER THE CASE CAME 

DOWN AND WE TOLD THEM THAT WE HAD TO GO TO THIS NEW STRUCTURE, 

AND HE SENT ME AN E-MAIL SAYING, HEY, WE SPENT SO MUCH TIME ON 

THE LAST STRUCTURE, DO WE REALLY NEED TO CHANGE IT? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 142 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

302

AND I WAS RESPONDING TO THAT.

Q. OKAY. I'LL DIRECT YOU TO THE SECOND PAGE OF THE E-MAIL 

NEAR THE END OF YOUR, YOUR -- THE SECOND PAGE OF THE EXHIBIT 

NEAR THE END OF YOUR E-MAIL, THE FIRST FULL PARAGRAPH. 

IT ENDS WITH YOUR SAYING, "LET ME REPEAT THAT OUR GOAL IS 

THE SAME AS YOURS: TO GET THE AGREEMENT DONE AS SOON AS 

POSSIBLE. I BELIEVE THAT WE CAN DO THAT BY THE END OF JULY." 

WAS THAT ACTUALLY QUALCOMM'S GOAL AT THE TIME, TO GET THE 

AGREEMENT DONE? 

A. YES, I BELIEVE IT WAS. I THINK BOTH SIDES HAD SPENT A LOT 

OF TIME ON THIS AND WE WANTED TO GET IT DONE AND MOVE ON.

Q. AND AFTER YOU SENT THIS E-MAIL TO DR. AHN, DID SAMSUNG GET 

BACK TO YOU AT ALL? 

A. I DON'T RECALL. I DON'T THINK THEY DID. 

Q. HAVE YOU EVER HEARD OF SOMETHING CALLED PROJECT DRAGONFLY? 

A. I HAVE A VAGUE RECOLLECTION OF THAT.

Q. WHAT'S YOUR VAGUE RECOLLECTION? 

A. THERE WAS SOME EFFORT BY A NUMBER OF COMPANIES, INCLUDING 

DOCOMO, WHICH IS AN OPERATOR IN JAPAN, AND SOME OTHER JAPANESE 

COMPANIES, I THINK SAMSUNG WAS INVOLVED IN THAT AS WELL, 

BASICALLY THEY WERE GOING TO COME TOGETHER AND FORM A JOINT 

VENTURE TO DO MODEM CHIPS. I DON'T REMEMBER WHETHER IT WAS FOR 

WCDMA OR SOMETHING ELSE. 

AND I THINK THEY APPROACHED QUALCOMM AND ASKED IF THERE 

WAS A CHIP LEVEL PATENT AGREEMENT THAT COULD BE PUT IN PLACE.

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 143 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

303

Q. AND DID QUALCOMM ENTER INTO A CHIP LEVEL PATENT AGREEMENT 

WITH THIS JOINT VENTURE? 

A. NO. I THINK WHAT HAPPENED WAS THE JOINT VENTURE BASICALLY 

DECIDED -- THEY COULDN'T AGREE AMONGST THEMSELVES ON HOW TO SET 

IT UP OR WHAT THE TERMS WERE GOING TO BE, SO THEY KIND OF 

ABANDONED IT. AND SO THEY CALLED OFF THE DISCUSSION. 

Q. LET ME ASK YOU TO LOOK AT ONE OF THE DOCUMENTS IN THE 

FTC'S BINDER. IT'S TAB 3, PLEASE. TAB 3 IS JX 0063, WHICH IS 

ALREADY IN EVIDENCE. 

AND THIS IS AN AGREEMENT THAT YOU WERE ASKED ABOUT BY THE 

FTC'S COUNSEL; CORRECT? 

A. I'M SORRY. WHICH TAB ARE WE AT?

Q. I'M SORRY. IT'S TAB -- OH, I SHOULD BE AT TAB 4. 

APOLOGIES. JX 0063? 

A. YEAH, I SEE IT.

Q. OKAY. SO THIS IS AN AGREEMENT WITH SONY MOBILE THAT YOU 

WERE ASKED ABOUT BY COUNSEL FOR THE FTC? 

A. YES. 

Q. AND COUNSEL FOR THE FTC HAD DIRECTED YOU TO PAGE 015 OF 

THE AGREEMENT, THE PROVISION REGARDING ROYALTIES. 

A. YES.

Q. AND SHE HAD ASKED YOU SOME QUESTIONS ABOUT THE 5 PERCENT 

FIGURE IN THE TOP PARAGRAPH OF THAT PROVISION AND YOU HAD 

WANTED TO SAY SOMETHING ABOUT, OR HAD STARTED TO SAY SOMETHING 

ABOUT THE TRUE UP THAT FOLLOWED. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 144 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

304

CAN YOU GIVE THE ANSWER THAT YOU HAD STARTED TO GIVE 

DURING HER EXAMINATION? EXPLAIN WHAT THAT IS. 

A. YEAH. SO THE PRE -- THE PREDECESSOR TO SONY MOBILE WAS 

CALLED SONY ERICSSON, WHICH WAS A JOINT VENTURE BETWEEN SONY 

AND ERICSSON. AND THEY WERE OPERATING, WHEN THEY WERE A JOINT 

VENTURE, UNDER THE ERICSSON AGREEMENT. 

AND ONCE ERICSSON DIVESTED ITS INTEREST TO SONY AND IT 

BECAME SONY MOBILE, EFFECTIVELY THEY COULD NO LONGER BE 

LICENSED UNDER THE ERICSSON AGREEMENT. 

SO WE HAD NEGOTIATED AN AGREEMENT WITH ERICSSON THAT COULD 

BE OFFERED TO SONY MOBILE, WHICH IS WHAT THE EARLIER E-MAIL 

EXCHANGE THAT FTC COUNSEL ASKED ME ABOUT WAS ABOUT. 

WE WERE NOT ABLE TO CONVERGE QUICKLY, SO WE CAME ON TO 

THIS PATH OF AN INTERIM AGREEMENT TO -- BASICALLY THAT THEY 

WOULD HAVE AN ABILITY TO NEGOTIATE WHILE WE CONTINUED TO HAVE A 

LICENSE IN PLACE FOR WHATEVER NUMBER OF MONTHS IT WAS. 

AND AT THE END OF THAT THERE BASICALLY WOULD BE A TRUE UP 

IN TERMS OF WHATEVER THE GO FORWARD ROYALTY RATE WOULD BE WOULD 

BE APPLIED RETROACTIVELY TO WHAT WAS PAID UNDER THIS INTERIM 

AGREEMENT.

Q. AND LET ME DIRECT YOU TO THE -- NEAR THE BOTTOM OF THE 

SECOND PARAGRAPH THAT'S ON THE GREEN RIGHT NOW. IT BEGINS WITH 

THE WORD "SUBJECT." 

IT REFERS TO A FINAL, NON-APPEALABLE RULING BY A COURT OF 

COMPETENT JURISDICTION OR IN ANOTHER MUTUALLY AGREED DISPUTE 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 145 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

305

RESOLUTION FORUM THAT IS BINDING ON BOTH QUALCOMM AND SMC. 

DO YOU SEE THAT?

A. YES.

Q. CAN YOU EXPLAIN WHAT THE RELEVANCE OF A POTENTIAL COURT 

RULING OR OTHER DISPUTE RESOLUTION RULING WAS IN CONNECTION 

WITH THIS AGREEMENT? 

A. I THINK THE IDEA WAS THAT IF THE PARTIES COULDN'T AGREE, 

WE WERE GOING TO SUBMIT IT TO A THIRD PARTY FOR A 

DETERMINATION, AND THEN BOTH SIDES WOULD LIVE WITH WHATEVER 

THAT DETERMINATION WAS.

Q. AND IF QUALCOMM COULDN'T AGREE WITH SONY MOBILE ON A 

ROYALTY RATE AT THIS POINT IN TIME, WAS QUALCOMM WILLING TO 

LIVE WITH WHATEVER A COURT OR ANOTHER DISPUTE RESOLUTION 

PROCESS PRODUCED? 

A. YES. 

Q. TURN BACK ONE DOCUMENT IN THE BINDER, PLEASE, TO TAB 3. 

THIS IS CX 6552 ALREADY IN EVIDENCE. 

AND COUNSEL FOR THE FTC ASKED YOU ABOUT SOMETHING THAT YOU 

WROTE ON PAGE 005. 

AND THE SENTENCE THAT COUNSEL DIRECTED YOU TO IS IN THAT 

SECOND PARAGRAPH OF PAGE 005. 

I THINK WE HAVE THE WRONG DOCUMENT ON THE SCREEN. 

DO YOU HAVE THE RIGHT DOCUMENT IN FRONT OF YOU. IT'S AN 

E-MAIL. 

A. YEAH. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 146 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

306

Q. IT SAYS, "TO MY KNOWLEDGE, WE HAVE NEVER SHIPPED 

COMMERCIAL QUANTITIES OF CHIPS TO A COMPANY WITHOUT A LICENSE." 

DO YOU SEE THAT? 

A. YES. 

Q. AND YOU SAID AT THIS POINT THAT WAS A CORRECT STATEMENT. 

HAS, FOLLOWING THIS E-MAIL, QUALCOMM EVER SHIPPED 

COMMERCIAL QUANTITIES OF CHIPS TO A COMPANY WITHOUT A LICENSE? 

A. I DON'T BELIEVE SO. 

Q. DID QUALCOMM SHIP COMMERCIAL QUANTITIES OF CHIPS TO SONY 

MOBILE AT ANY POINT DURING THESE NEGOTIATIONS WITHOUT A 

LICENSE? 

A. I CAN'T RECALL SPECIFICALLY. I THINK -- I THINK THERE MAY 

HAVE BEEN, LIKE, A DAY OR TWO WHERE WE THOUGHT WE WERE GOING TO 

GET THE AGREEMENT DONE, BUT WE WERE WAITING FOR SIGNATURES AND 

WE MAY HAVE SHIPPED A COUPLE OF SHIPMENTS IN THERE JUST TO MAKE 

SURE THERE WASN'T A DISRUPTION.

Q. OKAY. LET ME ASK YOU TO LOOK AT ONE LAST DOCUMENT. IT'S 

TAB 8 IN THE FTC BINDER. THE EXHIBIT NUMBER -- 

THE COURT: I'M SORRY, JUST FOR THE TRANSCRIPT, I 

THINK YOU SAID 6552, BUT IT'S 6522 FOR TAB 3. 

MR. BORNSTEIN: OH, YOU'RE RIGHT. THANK YOU, YOUR 

HONOR. 

THE COURT: SO LET'S CLEAN UP THE TRANSCRIPT. THANK 

YOU. 

MR. BORNSTEIN: THE PROBLEM OF HAVING SO MANY 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 147 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

307

EXHIBITS. 

THE COURT: AS I'VE SAID, YOU ALL SHOULD HAVE LIMITED 

IT. 

(LAUGHTER.) 

THE COURT: I WAS ASKING. 

MR. BORNSTEIN: I -- I'M ACKNOWLEDGING YOUR HONOR'S 

WISDOM. CAN WE TAKE -- 

THE COURT: WELL, I'M HAPPY TO REDUCE THE NUMBER 

TOMORROW. I'LL GIVE YOU AN OPPORTUNITY TO PICK THE NUMBER. 

(LAUGHTER.) 

BY MR. BORNSTEIN: 

Q. LET'S TAKE A LOOK AT CX 5231. IT WILL BE MY LAST EXHIBIT. 

IT'S TAB 8 IN THE FTC'S BINDER. 

A. OKAY. 

Q. YOU W.

ERE ASKED BY COUNSEL FOR THE FTC ABOUT A SENTENCE AT THE 

VERY BOTTOM OF THE FIRST PAGE THAT YOU WROTE WHERE YOU SAID, 

"NOTE THAT HUAWEI HAS BEEN CLAIMING PATENT EXHAUSTION BASED ON 

THEIR PURCHASE OF CHIPS FROM QC DESPITE THE TERMS OF OUR SUPPLY 

AGREEMENT." 

DO YOU SEE THAT? 

A. YES. 

Q. WHY DID YOU MAKE THE POINT TO MR. MOLLENKOPF THAT HUAWEI 

HAD BEEN CLAIMING PATENT EXHAUSTION? 

A. I WAS TRYING TO EMPHASIZE THAT IT WASN'T A THEORETICAL 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 148 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE CROSS BY MR. BORNSTEIN

UNITED STATES COURT REPORTERS

308

RISK, YOU KNOW, IF WE SHIPPED TO THEM. 

WHEN WE STARTED THE DISCUSSION ABOUT ASKING THEM IF THEY 

WERE GOING TO EXTEND THE CDMA LICENSE, THEY SAID, OH, THE TERMS 

NEED TO BE RENEGOTIATED. AND ONE OF THE BASES FOR SAYING THEY 

SHOULD PAY WAS EVEN THOUGH WE HAD A LICENSE AGREEMENT AND THE 

SUPPLY AGREEMENT IN PLACE WITH THE PROVISIONS THAT WERE 

SUPPOSED TO BE NON-EXHAUSTIVE, THEY WERE CLAIMING THAT WHEN WE 

SOLD THEM CHIPS, THERE WAS EXHAUSTION UNDER CHINESE PATENT LAW, 

AND, THEREFORE, THAT SHOULD RESULT IN SOME REDUCTION OF THE 

ROYALTIES THEY PAID. 

SO CERTAINLY IF THERE WAS NO LICENSE, YOU KNOW, THEY WOULD 

HAVE TAKEN AN EVEN STRONGER POSITION ON THAT ISSUE. SO I WAS 

HIGHLIGHTING THEY'D ALREADY RAISED THIS WITH US. IT WASN'T A 

THEORY. 

MR. BORNSTEIN: THANK YOU. I HAVE NO FURTHER 

QUESTIONS RIGHT NOW. 

MR. VAN NEST: YOUR HONOR, MAY I HAVE JUST A MOMENT 

WITH COUNSEL? 

THE COURT: YES, GO AHEAD, PLEASE. 

(DISCUSSION OFF THE RECORD BETWEEN DEFENSE COUNSEL.)

MR. BORNSTEIN: ALL RIGHT. THANK YOU, YOUR HONOR. 

THE COURT: OKAY. TIME IS 2:08. 

DO YOU HAVE ANY RECROSS? 

MS. MILICI: I DO. 

THE COURT: OR REDIRECT I SHOULD SAY. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 149 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE REDIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

309

MS. MILICI: I DO. 

(PAUSE IN PROCEEDINGS.) 

REDIRECT EXAMINATION

BY MS. MILICI: 

Q. SIR, YOU JUST TESTIFIED THAT -- ABOUT A DISPUTE WITH OPPO 

AND VIVO. DO YOU RECALL THAT? 

A. YES.

Q. AND YOU SUGGESTED THAT QUALCOMM CONTINUED TO SHIP THEM 

CHIPS WHEN THEY TOOK THE POSITION THAT THEY WERE UNLICENSED? 

A. YES. 

Q. AND -- BUT QUALCOMM'S POSITION WAS THAT THEY WERE 

LICENSED; CORRECT? 

A. YES.

Q. AND WHAT KIND OF CHIPS WERE THEY BUYING? 

A. MY RECOLLECTION IS THAT THEY WERE BUYING STUFF KIND OF 

ACROSS THE WHOLE ROADMAP OF THEIR, THEIR PRODUCTS. BUT A LOT 

OF STUFF IN THE MID-TIER. 

Q. OKAY. QUALCOMM'S COUNSEL ASKED YOU A COUPLE OF QUESTIONS 

ABOUT THE LG NEGOTIATION THAT I HAD RAISED WITH YOU. 

DO YOU RECALL THAT? 

A. YES. 

Q. AND THERE WAS DISCUSSION ABOUT YOUR WILLINGNESS TO REDUCE 

THE ROYALTY RATE? 

A. FOR THE OFDM LICENSE, YES. 

Q. FOR THE OFDM LICENSE. DOES QUALCOMM HAVE A STANDARD 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 150 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE REDIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

310

ROYALTY RATE FOR OFDM? 

A. I DON'T KNOW WHAT IT HAS NOW. 

Q. DID IT HAVE A STANDARD ROYALTY RATE FOR OFDM WHEN YOU WERE 

THERE? 

A. WE DID, BUT AT THAT TIME THAT WAS THE FIRST AGREEMENT WE 

WERE NEGOTIATING, SO WE WERE BASICALLY ESTABLISHING A RATE AT 

THAT TIME IN THE LG DISCUSSION. 

Q. SO IN THE LG DISCUSSION, YOU WERE ESTABLISHING A RATE? 

YOU WEREN'T OFFERING THEM A LOWER RATE THAN THEY HAD PREVIOUSLY 

HAD OR A LOWER RATE THAN SOMEBODY ELSE HAD; CORRECT? 

A. WELL, WE WERE OFFERING THEM A LOWER RATE THAN WHAT WE 

ORIGINALLY PROPOSED IN THE NEGOTIATION, SO WE WERE MAKING A 

CONCESSION.

Q. OKAY. AND YOUR -- IT IS YOUR UNDERSTANDING THAT QUALCOMM 

HAD A STANDARD ROYALTY RATE FOR 2G AND 3G THAT WAS 5 PERCENT; 

CORRECT? 

A. A TYPICAL RATE WAS 5 PERCENT FOR 2G AND 3G.

Q. AND THE BLACKBERRY AGREEMENT THAT YOU TESTIFIED ABOUT THAT 

WAS STRUCTURED DIFFERENTLY, DID QUALCOMM UNDERSTAND THAT 

AGREEMENT TO BE EQUIVALENT TO AN AGREEMENT THAT HAD A 5 PERCENT 

RUNNING ROYALTY RATE? 

A. IT WAS NOT -- YOU COULDN'T DETERMINE THAT AT THE 

BEGINNING, RIGHT? IT DEPENDED ON HOW MANY DEVICES WERE SOLD AT 

WHAT SELLING PRICE DURING THE PERIOD OF TIME COVERED BY THAT 

PREPAYMENT.

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 151 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE REDIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

311

Q. SIR, I'M ASKING YOU WHETHER QUALCOMM CONSIDERED IT 

EQUIVALENT TO A 5 PERCENT RUNNING ROYALTY RATE? 

A. NO. IT WAS DIFFERENT.

CAN I CLARIFY SOMETHING? WHEN I SAY "DIFFERENT," IT COULD 

HAVE BEEN LOWER, IT COULD HAVE BEEN HIGHER, IT COULD HAVE BEEN 

THE SAME. IT DEPENDED ON HOW THEIR BUSINESS PERFORMED ON A 

GOING FORWARD BASIS.

Q. BUT WHEN QUALCOMM WAS DECIDING TO GO FORWARD WITH THE 

AGREEMENT THAT WAS STRUCTURED THE WAY THAT THE BLACKBERRY 

AGREEMENT, IT WAS BECAUSE IT BELIEVED THAT THE RETURNS TO 

QUALCOMM WOULD BE EQUIVALENT TO A 5 PERCENT RUNNING ROYALTY 

RATE; CORRECT? 

A. NO. BOTH SIDES WERE TAKING A RISK.

Q. OKAY. NOW, YOU MENTIONED IN YOUR TESTIMONY A FEW MINUTES 

AGO THAT, THAT APPLE WOULDN'T HAVE AN ARGUMENT THAT THEY HAD 

OBTAINED EXHAUSTIVE RIGHTS WHEN PURCHASING FROM INTEL. 

DO YOU RECALL SAYING THAT? 

A. YES, TO QUALCOMM PATENTS.

Q. TO QUALCOMM PATENTS. 

YET, THAT'S BECAUSE QUALCOMM WON'T LICENSE INTEL; ISN'T 

THAT CORRECT? 

A. THAT'S BECAUSE THERE'S NO AGREEMENT IN PLACE GRANTING ANY 

RIGHTS TO INTEL. 

Q. BUT QUALCOMM COULD GRANT THOSE RIGHTS TO INTEL, COULDN'T 

IT? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 152 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE REDIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

312

A. THEORETICALLY IT COULD, YES. 

Q. OKAY. AND IF QUALCOMM DID GRANT THOSE RIGHTS TO INTEL, 

THEN APPLE'S ARGUMENT ABOUT EXHAUSTION WOULD BE THE SAME 

WHETHER THEY PURCHASED FROM QUALCOMM OR FROM INTEL; CORRECT? 

A. DEPENDS. I MEAN, IT DEPENDS ON WHAT THE TERMS OF THAT 

AGREEMENT WOULD BE.

Q. LET'S SAY QUALCOMM GRANTED INTEL A FULLY EXHAUSTIVE 

LICENSE. APPLE'S EXHAUSTION ARGUMENT WOULD BE THE SAME NO 

MATTER WHO THEY PURCHASED FROM; CORRECT? 

A. I STILL THINK THERE'S DIFFERENCES IN TERMS OF WHAT'S IN 

EACH CHIP AND WHAT PATENTS ARE LICENSED BY THE AGREEMENT. SO I 

CAN'T ANSWER IT THAT WAY. 

Q. OKAY. NOW, YOU TESTIFIED EARLIER THAT -- ABOUT SAMSUNG 

AND NEGOTIATIONS ABOUT A CHIP LEVEL LICENSE. 

DO YOU RECALL THAT? 

A. YES. 

Q. AND IS IT YOUR TESTIMONY THAT SAMSUNG WAS NOT SEEKING AN 

EXHAUSTIVE LICENSE? 

A. YES. 

Q. OKAY. COULD YOU PLEASE TURN TO PAGE 105 OF YOUR 

DEPOSITION. 

A. YEAH. LET ME CLARIFY THAT FIRST. THE TIME PERIOD IN 

WHICH MR. BORNSTEIN ASKED ABOUT, THEY WERE ASKING ONLY FOR A 

NON-EXHAUSTIVE AGREEMENT. 

Q. YES. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 153 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE REDIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

313

A. LATER, AFTER THE KFTC DECISION CAME DOWN, THEY CAME BACK 

AND THAT'S NOT THE DISCUSSION I WAS REFERRING TO.

Q. OKAY. SO IT IS YOUR TESTIMONY THAT SAMSUNG HAS INDEED 

SOUGHT AN EXHAUSTIVE LICENSE FOR ITS CHIPSETS; CORRECT?

A. I'M NOT 100 PERCENT SURE. IT WAS HAPPENING AROUND THE 

TIME I LEFT THE COMPANY. SO IT'S POSSIBLE THEY DID ASK FOR IT. 

I JUST DON'T -- AS I SIT HERE, I THINK THEY DID, BUT I'M NOT 

100 PERCENT SURE.

Q. CAN YOU PLEASE TURN TO PAGE 105 OF YOUR DEPOSITION? 

A. 115. 

Q. 105. 

A. YES. 

Q. 105, LINE 20. DO YOU SEE WHERE I ASKED YOU, "HAVE ASIC 

MANUFACTURERS REQUESTED EXHAUSTIVE LICENSES FROM QUALCOMM?"

DO YOU SEE THAT? 

A. YES.

Q. AND THEN YOU SAID -- YOUR ANSWER WAS, "I THINK AT ONE 

POINT, INTEL DID. BROADCOM. MEDIATEK. SAMSUNG." 

AND YOU THOUGHT HUAWEI AS WELL. 

DO YOU SEE THAT? 

A. YES.

Q. OKAY. SO IS IT YOUR TESTIMONY TODAY THAT THOSE COMPANIES 

HAVE ALL ASKED -- SOUGHT EXHAUSTIVE LICENSES FROM QUALCOMM? 

A. YEAH, I BELIEVE SO. 

Q. OKAY. AND QUALCOMM'S COUNSEL WAS ASKING YOU QUESTIONS 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 154 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE REDIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

314

ABOUT JX 0063. 

DO YOU RECALL THAT? 

A. CAN YOU TELL ME WHICH TAB THAT'S AT?

Q. THAT IS IN THE BINDER I GAVE YOU AT TAB 4. IT'S THE SONY 

AGREEMENT. 

A. OKAY. 

Q. AND YOU'LL RECALL THAT WHEN WE LOOKED AT THIS AGREEMENT 

TOGETHER, WE AGREED THAT THE AGREEMENT EXPIRED IN OCTOBER OF 

2012; CORRECT? 

A. LET ME JUST CONFIRM, BUT I THINK THAT'S THE DATE THAT YOU 

TOLD ME OR THAT WE LOOKED AT.

Q. AND SONY NEVER GOT A TRUE UP ON ANY ROYALTIES THAT IT PAID 

UNDER THIS AGREEMENT, DID IT? 

A. I THINK THE PARTIES EVENTUALLY ENTERED INTO A NEW 

AGREEMENT THAT CAME INTO EFFECT AFTER THIS, AND I THINK IT WAS 

AT THE 5 PERCENT ROYALTY. 

Q. SO IN THIS NEGOTIATION, SONY ASKED FOR LOWER, FOR A LOWER 

RATE THAN 5 PERCENT, GOT AN INTERIM AGREEMENT AT 5 PERCENT, AND 

THEN THEY GOT A FINAL AGREEMENT AT 5 PERCENT; CORRECT? 

A. I BELIEVE THAT'S RIGHT. 

Q. OKAY. AND AT SEVERAL POINTS THROUGH THE COURSE OF THOSE 

NEGOTIATIONS, ERIC REIFSCHNEIDER AND OTHERS REMINDED SONY THAT 

IF THEY DID NOT REACH AN AGREEMENT, THAT THEY WOULD BE UNABLE 

TO PURCHASE CHIPS; IS THAT CORRECT? 

A. I REMEMBER YOU SHOWING ME PASSAGES FROM E-MAILS WHERE THAT 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 155 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE REDIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

315

WAS COMMUNICATED.

Q. DO YOU RECALL THAT -- THOSE THINGS BEING COMMUNICATED AT 

THE TIME? 

A. YES. 

Q. AND YOU WERE THE PRESIDENT OF QCT AT THE TIME; CORRECT?

A. I'M NOT 100 PERCENT -- EITHER PRESIDENT OR GROUP 

PRESIDENT. BUT I HAD OVERALL RESPONSIBILITY FOR THE BUSINESS 

AT THE TIME.

Q. AND THERE WERE REMINDERS TO SONY ABOUT ITS INABILITY TO 

BUY CHIPS IF IT BECAME UNLICENSED MULTIPLE TIMES THROUGH THOSE 

NEGOTIATIONS; CORRECT? 

A. YEAH. I THINK WE KEPT HAVING TO COME BACK TO IT BECAUSE 

THE NEGOTIATIONS WERE NOT -- YOU KNOW, WERE STALLING AND WE 

FELT THEY WERE PUSHING US CLOSE TO THE LINE. AND SO WE HAD TO 

KEEP TELLING THEM, WE'VE GOT TO GET SOMETHING DONE SO THAT THIS 

DOESN'T BECOME A PROBLEM.

Q. TO -- 

A. WE WERE TRYING TO AVOID THE PROBLEM, NOT CREATE IT.

Q. DID QUALCOMM EVER OFFER A LOWER ROYALTY RATE THAN 

5 PERCENT? 

A. THERE WERE A NUMBER OF DISCUSSIONS AROUND AN EXCHANGE OF 

VALUE, AND WE EXPRESSED AN OPENNESS TO DISCUSS A DIFFERENT RATE 

IF THERE WAS VALUE THAT COULD COME BACK, AND I DO REMEMBER 

DISCUSSIONS AROUND A CROSS-LICENSE FROM SONY MOBILE. WE HAD 

SUGGESTED THEY ACTUALLY, IF THEY COULD PUT SONY PATENTS ON THE 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 156 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

ABERLE REDIRECT BY MS. MILICI

UNITED STATES COURT REPORTERS

316

TABLE AS OPPOSED TO SONY MOBILE, THAT COULD HELP MOVE THE DEAL. 

BUT I THINK ULTIMATELY THEY WEREN'T ABLE OR WILLING TO DO 

THAT, SO WE ENDED UP AT THE 5 PERCENT RATE.

Q. SO YOUR TESTIMONY IS THAT QUALCOMM MADE OFFERS TO SONY OF 

LOWERING A ROYALTY RATE IF SONY GAVE IT SOMETHING OF VALUE; 

CORRECT? 

A. WE SAID WE WERE WILLING TO DISCUSS A DIFFERENT RATE, BUT 

THERE HAD TO BE VALUE ASSOCIATED WITH THAT IS MY RECOLLECTION, 

AND THEY WERE UNWILLING OR UNABLE TO PUT ANY MEANINGFUL VALUE 

ON THE TABLE.

Q. AND THE VALUE ASSOCIATED WITH THAT WOULD BE VALUE BEING 

PROVIDED FROM SONY TO QUALCOMM IN ORDER TO GET A LOWER ROYALTY 

RATE THAN 5 PERCENT; CORRECT? 

A. THAT'S MY RECOLLECTION. 

MS. MILICI: THANK YOU. NO MORE QUESTIONS. 

THE COURT: OKAY. TIME IS 2:18. 

DO YOU HAVE ANY FURTHER QUESTIONS? 

MR. BORNSTEIN: NO FURTHER QUESTIONS, YOUR HONOR. 

THE COURT: OKAY. MAY THIS WITNESS BE EXCUSED, AND 

IS IT SUBJECT TO RECALL OR NOT SUBJECT TO RECALL? 

MS. MILICI: NOT SUBJECT TO RECALL. 

MR. BORNSTEIN: FREE TO GO, YOUR HONOR, NOT SUBJECT 

TO RECALL. 

THE COURT: OKAY. THEN YOU'VE COMPLETED YOUR TRIAL 

TESTIMONY. YOU'RE FREE TO LEAVE. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 157 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

UNITED STATES COURT REPORTERS

317

THE WITNESS: THANK YOU, YOUR HONOR. 

THE COURT: DO YOU WANT TO TAKE A FIVE MINUTE BREAK 

NOW AND THEN TAKE A LONGER BREAK AT -- WE CAN TAKE A TEN MINUTE 

BREAK NOW TO 2:30. 

OKAY. THANK YOU FOR YOUR PATIENCE. WE'LL SEE YOU BACK IN 

TEN MINUTES. 

WE'RE IN RECESS. 

(RECESS FROM 2:19 P.M. UNTIL 2:32 P.M.) 

THE COURT: GOOD AFTERNOON AND WELCOME BACK. 

MR. VAN NEST: THANK YOU, YOUR HONOR. 

THE COURT: CALL YOUR NEXT WITNESS, PLEASE. 

MR. KEHL: PHIL KEHL FROM THE FTC. 

THE FTC CALLS FINBARR MOYNIHAN. 

MAY I APPROACH WITH BINDERS FOR THE COURT? 

THE COURT: YES, PLEASE. THANK YOU. 

(PAUSE IN PROCEEDINGS.) 

THE CLERK: PLEASE RAISE YOUR RIGHT HAND. 

(PLAINTIFF'S WITNESS, JOHN MOYNIHAN, WAS SWORN.)

THE WITNESS: I DO. 

THE CLERK: THANK YOU. PLEASE BE SEATED. 

MR. KEHL: YOUR HONOR, IF I COULD NOTE AT THE OUTSET, 

THERE ARE THREE MEDIATEK DOCUMENTS THAT WERE SUBJECT TO A 

SEALING MOTION, AND SO THAT'S BEEN NOTED IN THE BINDER. 

AND MEDIATEK HAS ALSO SOUGHT TO SEAL TESTIMONY, AND THE 

FTC DOES NOT OPPOSE THAT MOTION, AND WE BELIEVE WE CAN CONDUCT 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 158 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

UNITED STATES COURT REPORTERS

318

A SEALED EXAMINATION WITH A LIMITED NUMBER OF QUESTIONS TOWARDS 

THE END OF OUR EXAM, BUT WOULD APPRECIATE GUIDANCE FROM THE 

COURT. 

MR. SHACHAM: YOUR HONOR, IF I MAY? MATAN SHACHAM 

FOR QUALCOMM. 

IF I MAY SPEAK ON THE SEALING POINT? I BELIEVE YOUR HONOR 

ALREADY DEALT WITH THAT IN THE ORDER YOU ISSUED LAST NIGHT. 

YOU CONSIDERED THE REQUEST TO SEAL THE DOCUMENT AND THE 

DOCUMENTS AND YOU ORDERED ONLY THE DOCUMENTS BE SEALED. I 

THINK THE EASIEST WAY TO GO IS WHAT WE'VE DONE UP UNTIL NOW, 

WHICH IS WE WON'T DISPLAY THE SEALED DOCUMENTS OR GET INTO 

THOSE. I THINK IT WOULD NOT BE A GOOD IDEA TO SEAL THE COURT 

AND HAVE PEOPLE MARCHING IN AND OUT. I BELIEVE IT'S DOCKET 

1140, YOUR HONOR. 

THE COURT: 1140 JUST DEALT WITH THE THREE DOCUMENTS. 

MR. SHACHAM: RIGHT. BUT THE MOTION THAT THEY FILED 

ASKED FOR BOTH THE COURTROOM AND THE DOCUMENTS TO BE SEALED. 

THE COURT: RIGHT. BUT THERE WEREN'T ANY PARTICULAR 

TRANSCRIPT EXCERPTS; CORRECT? 

MR. KEHL: THAT'S CORRECT, YOUR HONOR. 

SO WE INTERPRETED THE ORDER AS JUST ADDRESSING THE 

DOCUMENTS, WHICH IS WHY I RAISED THE ISSUE NOW. 

THE COURT: OKAY. IS THERE ANYONE FROM MEDIATEK 

HERE, OR REPRESENTING MEDIATEK? 

MR. KEHL: I BELIEVE THERE IS, YOUR HONOR.

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 159 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

UNITED STATES COURT REPORTERS

319

THE COURT: I'M UNCLEAR. I ONLY RULED ON WHAT YOU 

OBJECTED TO, WHICH IS CX -- ACTUALLY, IT'S OKAY. THEY'RE IN 

ECF NUMBER 1140.

MR. KEHL: I'M JUST LOOKING FOR GUIDANCE FROM THE 

COURT ON HOW TO APPROACH THE QUESTIONS ONCE WE GET TO THE 

PORTION OF TESTIMONY THAT WOULD IMPLICATE TOPICS COVERED BY 

MEDIATEK'S MOTION. 

THE COURT: I'M SORRY. DID I NOT RULE ON THOSE? I 

HAVEN'T RULED ON THOSE EXCERPTS YET? 

MR. KEHL: THERE'S NOT YET TESTIMONIAL EXCERPTS. 

WE'RE GOING TO BE ASKING MR. MOYNIHAN QUESTIONS THAT ADDRESS 

TOPICS RAISED IN THEIR MOTION. 

THE COURT: THAT ARE SEPARATE FROM THE THREE EXHIBITS 

THAT THEY SPECIFICALLY SOUGHT TO SEAL? 

MR. KEHL: WELL, THE TESTIMONY WILL TOUCH ON, OR THE 

QUESTIONS WILL TOUCH ON THE DOCUMENTS, BUT WILL CONTAIN 

ADDITIONAL INFORMATION. 

THE COURT: I THINK WHEN WE GET TO THE TOPIC OF THESE 

THREE EXHIBITS, WE SHOULD SEAL THE COURTROOM. 

SO HOW MUCH DO YOU HAVE THAT'S ON THESE? BECAUSE I DON'T 

KNOW HOW YOU CAN HAVE A CONVERSATION ABOUT THOSE PARTICULAR 

ITEMS WITHOUT SEALING. 

MR. KEHL: THAT'S FINE WITH US, YOUR HONOR. 

THE COURT: OKAY. SO WHAT DO YOU HAVE OUTSIDE OF 

THESE THREE EXHIBITS? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 160 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

UNITED STATES COURT REPORTERS

320

MR. KEHL: I PROBABLY, I'D ESTIMATE THAT WE HAVE 

ABOUT 25 MINUTES BEFORE WE GET TO THE SEALED EXHIBITS. 

THE COURT: OH, OKAY. ALL RIGHT. NOW, IS THERE A 

SEGMENTATION OF YOUR CROSS THAT CAN BE DONE? 

MR. SHACHAM: YOUR HONOR, I BELIEVE THAT I CAN DO MY 

CROSS IN A WAY THAT WE'VE DONE EXAMINATIONS UP UNTIL NOW, WHICH 

IS TO NOT REFER TO THE DETAILS OF THE DOCUMENT, I'LL SHOW THE 

DOCUMENT TO THE WITNESS, I'LL CLOSE THE PUBLIC MONITOR, AND 

I'LL ASK ABOUT THEM IN A WAY THAT I THINK DOESN'T ELICIT THE 

DETAILS. 

I WOULD IMAGINE THAT THE FTC COULD DO THE SAME THING. IN 

FACT, AT LEAST WE SHOULD TRY THAT AND THAT WOULD BE THE MOST 

EFFICIENT -- 

THE COURT: NO, I'M NOT GOING TO DO THAT BECAUSE THE 

CONTENT OF THIS IS A LITTLE DIFFERENT THAN JUST TALKING ABOUT A 

ROYALTY RATE WITHOUT GIVING THE NUMBER. THESE ARE SPECIFIC 

CONCEPTS THAT HAVE BEEN SEALED, SO I THINK THAT'S MORE 

PROBLEMATIC IN THIS CASE. IT'S NOT AS CLEARLY BIFURCATED AS IN 

JUST TALKING ABOUT A ROYALTY RATE IN GENERAL. 

SO DO YOU HAVE A PART THAT IS NOT GOING TO TOUCH UPON 

THESE THREE EXHIBITS? 

MR. SHACHAM: I DO. I DO, YOUR HONOR, AND I CAN DO 

THAT FIRST AND TRY TO DO THE PART -- 

THE COURT: OKAY. WE'LL HAVE BOTH PARTIES DO THEIR 

UNSEALED PORTIONS AND THEN WE'LL ASK EVERYONE WHO'S NOT A PARTY 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 161 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN DIRECT BY MR. KEHL

UNITED STATES COURT REPORTERS

321

TO STEP OUTSIDE AND THEN WE'LL DO THE SEALED PORTIONS FOR BOTH 

PARTIES. OKAY? 

MR. SHACHAM: YES, I THINK THAT WORKS. 

THE COURT: OKAY. ALL RIGHT. GO AHEAD, PLEASE. 

TIME IS 2:37. 

THE CLERK: WOULD YOU STATE YOUR FULL NAME AND SPELL 

YOUR LAST NAME FOR THE RECORD. 

THE WITNESS: SURE. JOHN FINBARR MOYNIHAN. 

M-O-Y-N-I-H-A-N. 

THE COURT: 2:11. GO AHEAD. 

DIRECT EXAMINATION

BY MR. KEHL:

Q. GOOD AFTERNOON, MR. MOYNIHAN. 

A. GOOD AFTERNOON.

Q. COULD YOU PLEASE INTRODUCE YOURSELF? 

A. MY NAME IS FINBARR MOYNIHAN.

Q. WHAT IS YOUR CURRENT EMPLOYER? 

A. MEDIA. 

Q. WHEN DID YOU BEGIN WORKING AT MEDIATEK? 

A. JANUARY 2008. 

Q. WHAT'S YOUR CURRENT ROLE AT MEDIATEK? 

A. I'M THE GENERAL MANAGER FOR A TEAM THAT WE CALL CORPORATE 

SALES AND BUSINESS DEVELOPMENT FOR THE AMERICAS AND EUROPE. 

THE COURT: CAN YOU ADJUST THE MICROPHONE. 

THE WITNESS: SORRY. DO YOU WANT IT CLOSER? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 162 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN DIRECT BY MR. KEHL

UNITED STATES COURT REPORTERS

322

THE COURT: YES, PLEASE.

BY MR. KEHL:

Q. WHAT ARE YOUR RESPONSIBILITIES? 

A. MY TEAM MANAGES OUR CUSTOMER AND BUSINESS PARTNER 

INTERFACES, RELATIONSHIPS IN THE AMERICAS AND EUROPE.

Q. FOR WHICH PRODUCTS DO YOU -- ARE YOU INVOLVED? 

A. ALL OF MEDIATEK PRODUCTS.

Q. COULD YOU GIVE EXAMPLES OF SOME OF THE PRODUCTS FOR WHICH 

YOU'RE RESPONSIBLE? 

A. SURE. HOME ELECTRONIC, WI-FI, CONSUMER ELECTRONICS 

PRODUCTS, SMARTPHONES, FEATURE PHONES.

Q. WHEN YOU SAY SMARTPHONE, ARE YOU REFERENCING MODEM CHIPS? 

A. CHIPSETS FOR SMARTPHONES MORE PRECISELY.

Q. COULD YOU PLEASE GIVE A BRIEF SUMMARY OF YOUR ROLES ON 

ASSOCIATED PRODUCTS BEFORE YOUR CURRENT ROLE? 

A. SO I JOINED MEDIATEK IN 2008. I WORKED IN A FEW DIFFERENT 

PRODUCT MARKETING ROLES FOR A WHILE. 

IN 2000 -- LATE 2011, EARLY 2012, I MOVED INTO MORE OF A 

BUSINESS DEVELOPMENT ROLE AND OVER THE INTERVENING YEARS, IT'S 

BASICALLY BEEN SIMILAR CORPORATE SALES, BUSINESS DEVELOPMENT 

ROLES, AND DIFFERENT REGIONAL RESPONSIBILITIES.

Q. HAVE YOU BEEN RESPONSIBLE FOR MODEM CHIP SALES DURING THIS 

TIME? 

A. YES. 

Q. WHERE WERE YOU EMPLOYED BEFORE MEDIATEK? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 163 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN DIRECT BY MR. KEHL

UNITED STATES COURT REPORTERS

323

A. I WAS EMPLOYED AT ANALOG DEVICES.

Q. AND WHAT'S ANALOG DEVICES? 

A. IT'S ANOTHER SEMICONDUCTOR COMPANY, U.S. COMPANY 

HEADQUARTERED IN MASSACHUSETTS. 

Q. WAS ANALOG DEVICES ACQUIRED BY MEDIATEK? 

A. MORE ACCURATELY, THE BUSINESS UNIT, THE WIRELESS BUSINESS 

UNIT THAT I WORKED FOR WAS ACQUIRED BY MEDIATEK. NOT THE WHOLE 

COMPANY. 

Q. WHAT IS YOUR UNDERSTANDING OF THE RATIONALE FOR THE 

MEDIATEK ACQUISITION OF THE WIRELESS ANALOG DEVICES? 

A. WHAT WAS EXPLAINED TO US AT THE TIME WAS MEDIATEK WAS 

LOOKING TO ACQUIRE A FOOTPRINT, R&D TEAMS, SALES AND BUSINESS 

DEVELOPMENT TEAMS, IN THE U.S. AND EUROPE PREDOMINANTLY WITH A 

FOCUS OF GOING AFTER MORE TIER 1 WIRELESS BUSINESS.

Q. AND AGAIN, WHEN YOU REFER TO WIRELESS BUSINESS, ARE YOU 

REFERRING TO CELLULAR MODEMS? 

A. YEAH, MODEMS AND CHIPSETS FOR FEATURE PHONES OR 

SMARTPHONES PREDOMINANTLY.

Q. NOW, MR. MOYNIHAN, WE'RE GOING TO BE DISCUSSING THE 

INDUSTRY THROUGHOUT THE DAY. PER COURT ORDER, THE INTRODUCTION 

OF EVIDENCE FROM AFTER MARCH 2018 HAS BEEN EXCLUDED. 

SO COULD YOU PLEASE REFRAIN FROM IDENTIFYING OR MAKING 

REFERENCE TO SPECIFIC EVENTS THAT HAPPENED AFTER THAT DATE. 

A. SURE, I'LL DO THE BEST I CAN.

Q. MR. MOYNIHAN, WHICH FIRMS MAKE MODEM CHIPS? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 164 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN DIRECT BY MR. KEHL

UNITED STATES COURT REPORTERS

324

A. TODAY, QUALCOMM, MEDIATEK, CERTAINLY HISILICON AND 

SAMSUNG, AND THERE'S ANOTHER COMPANY NOW CALLED UNISOC THAT 

USED TO BE CALLED SPECTRUM IN CHINA THAT ALSO MAKES SOME FLAVOR 

OF CHIPS.

Q. HOW HAS THIS CHANGED OVER TIME, IF AT ALL? 

A. THERE ARE PROBABLY LESS PRODUCERS TODAY THAN THERE WERE 

YEARS AGO.

Q. COULD YOU GIVE ME SOME EXAMPLES? 

A. SO THERE'S A NUMBER OF COMPANIES THAT I CAN THINK OF, 

BROADCOM, MARVEL, NVIDIA, ST ERICSSON, TI, FREE SCALE, PERHAPS 

OTHERS, RENASIS IS ANOTHER ONE I CAN THINK OF THAT HAS STOPPED 

DEVELOPING CELLULAR MODEMS.

Q. AND, MR. MOYNIHAN, WHY IN TERMS OF MARKET POSITION HAS 

MEDIATEK BEEN SUCCESSFUL AT SELLING MODEM CHIPS?

A. I WOULD SAY MOSTLY IN THE LOWER TIERS OF THE MARKET, SO 

EITHER 2G FEATURE PHONES OR ENTRY 3G, ENTRY 4G PHONES TODAY. 

Q. HOW HAS THIS CHANGED OVER TIME, IF AT ALL? 

A. PROBABLY DEPENDS A LITTLE BIT ON THE YEAR. BUT I THINK 

OUR STRENGTH HAS MOSTLY BEEN, OUR MARKET SHARE HAS MOSTLY BEEN 

IN THOSE KIND OF TIERS REALLY FROM 2G ALL THE WAY TO TODAY. 

YOU KNOW, IT'S PROBABLY, IT'S PROBABLY RISEN UP A LITTLE BIT 

OVER THE YEARS AND SOME YEARS A LITTLE BETTER THAN OTHERS. BUT 

GENERALLY THE STRENGTH, THE VOLUME COMES FROM THE ENTRY TIERS.

Q. WHERE HAS MEDIATEK BEEN SUCCESSFUL? 

A. WE HAVEN'T REALLY PENETRATED EVER WHAT I WOULD CALL THE 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 165 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN DIRECT BY MR. KEHL

UNITED STATES COURT REPORTERS

325

PREMIER TIERS IN THE MARKET, THE HIGH TIERS, THE HIGHEST TIERS 

OF THE MARKET.

Q. YOU MENTIONED THE HIGHEST TIERS OF THE MARKET. WHAT ARE 

THE CHARACTERISTICS OF MODEM CHIPS IN THAT TIER? 

A. GENERALLY THOSE TEND TO BE, YOU KNOW, THE HIGHEST PRICED 

DEVICES. THEY TEND TO BE THE ONES WITH THE LATEST FEATURES, 

THE HIGHEST SPECS ON THE CELLULAR MODEM. 

IT PROBABLY TRANSLATES INTO A LOT OF VERY TECHNICAL 

FEATURES, BUT PREDOMINANTLY IT KIND OF RELATES TODAY I THINK TO 

DATA SPEED, WIRELESS MOBILE BROADBAND DATA SPEEDS THAT THE 

MODEMS CAN ACHIEVE, THEY TEND TO BE HIGHER.

Q. AND WHAT IS YOUR VIEW AS TO WHETHER A CUSTOMER WHO WANTS A 

PREMIUM MODEM, WHETHER THAT CUSTOMER COULD USE A NON-PREMIUM 

MODEM INSTEAD? 

A. AGAIN, IT PROBABLY DEPENDS ON THE CUSTOMER AND THE MARKET. 

BUT IF YOU -- YOU KNOW, A LOT OF THESE ARE, LET'S SAY IN THE 

U.S. MARKET, THEY TEND TO BE THE HIGHER PRICED DEVICES. THEY 

TEND TO BE SOURCED BY THE OPERATOR, THE CARRIERS HERE. 

THE CARRIERS TEND TO GENERATE RFQ'S, YOU KNOW, THAT 

REQUIRE CERTAIN FEATURE SETS. SO GENERALLY THOSE THINGS ARE 

NOT NEGOTIABLE. THEY'RE LOOKING FOR CERTAIN FEATURE SETS IN 

THOSE PRICE POINTS AT THOSE TIERS. SO GENERALLY NOT 

SUBSTITUTABLE. 

Q. AGAINST WHICH PRODUCTS DOES MEDIATEK BENCHMARK ITS MODEM 

CHIPS? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 166 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN DIRECT BY MR. KEHL

UNITED STATES COURT REPORTERS

326

A. MOSTLY I WOULD SAY AGAINST QUALCOMM'S. 

Q. ARE THERE PARTICULAR QUALCOMM MODEM CHIPS THAT YOU USE FOR 

BENCHMARKING? 

A. I MEAN, OBVIOUSLY THE THINGS LIKE THE SNAPDRAGON 800 

FAMILY FROM, FROM QUALCOMM TENDS TO BE AT THE LEADING EDGE, 

THAT TENDS TO BE THE MOST ADVANCED FEATURE SET. BUT THERE ARE 

OTHER TIERS OF PRODUCTS, SO WE'RE TALKING ABOUT AN ENTRY 

SEGMENT, WE MIGHT BENCHMARK AGAINST A DIFFERENT TIER OF 

PRODUCTS, LIKE A SNAPDRAGON 400 SERIES. 

Q. IS THERE A SNAPDRAGON 600 SERIES IN BETWEEN THE 800 AND 

THE 400? 

A. YES, THERE IS. 

Q. COULD YOU PLEASE GIVE AN EXAMPLE OF THE DEVICES SERVED BY 

THE SNAPDRAGON 800 SERIES? 

A. I THINK IT'S BEEN TRUE FOR A COUPLE OF YEARS THAT MOSTLY 

IT'S THE HIGH END, HIGH TIER, LIKE I CALL THEM THE PREMIUM OR 

SOMETIMES PEOPLE WOULD SAY FLAGSHIP DEVICES. THESE TEND TO BE 

THE HIGHEST TIER PRODUCTS THAT ARE PUT OUT THERE BY THE VARIOUS 

SMARTPHONE OEM AGENCY, SAMSUNG, LG, ET CETERA. 

Q. WHO SERVES THE PREMIUM SEGMENT OF THE MARKET? 

A. THE PHONE MANUFACTURERS OR THE CHIPSETS? 

Q. LET ME CLARIFY. IN TERMS OF MODEM CHIP SALES, WHO SERVES 

THE PREMIUM SEGMENT OF THE MARKET? 

A. IT DEPENDS I GUESS ON THE OEM. BUT QUALCOMM'S SNAPDRAGON 

800 TENDS TO BE THE DOMINANT ONE. COMPANIES LIKE SAMSUNG AND 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 167 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN DIRECT BY MR. KEHL

UNITED STATES COURT REPORTERS

327

HUAWEI HAVE IN-HOUSE SILICON CAPABILITY THAT SERVES THAT. 

APPLE USES A -- HAS USED A MIXTURE OF SUPPLIERS, QUALCOMM AND 

INTEL OVER THE YEARS FOR THE MODEM. 

Q. YOU MENTIONED SAMSUNG'S IN-HOUSE SUPPLY. DOES THAT FIRM 

HAVE A DISTINCT NAME? 

A. I TEND TO THINK OF IT AS SAMSUNG LSI, THE SEMICONDUCTOR 

DIVISION OF SAMSUNG.

Q. AND DOES HUAWEI'S CHIP DIVISION LIKEWISE HAVE A NAME? 

A. YES, HISILICON.

Q. HAVE YOU EVER CHANGED A MEDIATEK PRICE IN RESPONSE TO 

COMPETITION FROM SLSI AT AN OEM OTHER THAN SAMSUNG? 

A. NOT THAT I CAN THINK OF, NO.

Q. WHY NOT? 

A. WE DON'T TEND TO SEE SAMSUNG LSI AS A SUPPLIER MUCH 

OUTSIDE OF SAMSUNG'S OWN PHONES. 

Q. AND HAVE YOU EVER CHANGED MEDIATEK PRICING IN RESPONSE TO 

COMPETITION FROM HISILICON AT AN OEM OTHER THAN HUAWEI? 

A. NO, NOT THAT I'M AWARE OF. 

Q. AND WHY IS THAT? 

A. SAME REASON. I THINK EVEN MORE SO WE ONLY SEE HISILICON 

IN HUAWEI PHONES.

Q. MR. MOYNIHAN, WHAT IS A CDMA MODEM? 

A. CDMA MORE SPECIFICALLY, I GUESS CDMA 2000 IS WHAT IT'S 

BEEN CALLED, IS A 3G STANDARD. SO THE CDMA MODEM WOULD BE A 

MODEM CHIP THAT IMPLEMENTS THAT STANDARD, I GUESS. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 168 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN DIRECT BY MR. KEHL

UNITED STATES COURT REPORTERS

328

Q. FOR WHICH CELLULAR NETWORKS IS CDMA REQUIRED? 

A. IT'S CHANGED OVER THE YEARS, BUT TODAY IT'S, IT'S -- IN 

THE U.S. IT'S SPRINT AND VERIZON'S NETWORK, ALTHOUGH THE NEED 

OF VERIZON IS PROBABLY DIMINISHING A LITTLE BIT NOW. 

ALSO IN CHINA IT'S REQUIRED. THERE MAY BE SOME OTHER 

SMALL PLACES AS WELL.

Q. WHERE ELSE HAS CDMA BEEN REQUIRED?

A. OVER THE YEARS IT WAS REQUIRED IN SMALLER -- INDONESIA, 

INDIA, BRAZIL, SOME OTHER COUNTRIES. JAPAN AND KOREA IN THE 

PAST AS WELL.

Q. DOES MEDIATEK SELL MODEM CHIPS WITH CDMA CAPABILITIES?

A. YES, WE DO.

Q. WHEN DID MEDIATEK FIRST COMMERCIALIZE A MODEM CHIP WITH 

CDMA? 

A. THE FIRST -- THE FIRST COMMERCIAL PRODUCT WAS LAUNCHED IN 

2015. 

Q. WHEN DID MEDIATEK FIRST COMMERCIALIZE THE CDMA CHIP ON 

VERIZON'S CELLULAR NETWORK? 

A. THAT WOULD HAVE BEEN LATER, SO PROBABLY LATE, LATE 2016. 

Q. AND SAME QUESTION FOR SPRINT. 

A. VERY MUCH IN THE SAME TIMEFRAME, WITHIN A MONTH OR TWO OF 

EACH OTHER.

Q. HOW DID MEDIATEK DEVELOP THE MODEM CHIP COMPLIANT WITH 

CDMA? 

A. WE LICENSED IN THE PHYSICAL I.P. FROM ANOTHER COMPANY.

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 169 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN DIRECT BY MR. KEHL

UNITED STATES COURT REPORTERS

329

Q. WHICH COMPANY WAS THAT? 

A. IT WAS A COMPANY CALLED VIA TELECOM. 

Q. WHEN DID MEDIATEK ACQUIRE A LICENSE TO VIA TELECOM'S I.P.? 

A. PROBABLY AROUND 2013. IT WOULD HAVE TAKEN SOME TIME TO 

INTEGRATE THAT INTO A CHIPSET AND PRODUCE IT, SO ABOUT 2013 

TIMEFRAME. 

Q. WHAT ADDITIONAL ACCOUNTS, IF ANY, DID MEDIATEK WIN AFTER 

DEVELOPING A CDMA MODEM CHIP? 

A. SO FOR ONE, WE SUCCEEDED IN WINNING SOME DESIGNS WITH LG 

FOR THE U.S. MARKET, SO WE MENTIONED SPRINT AND VERIZON. THEY 

LAUNCHED MODELS WITH US BOTH AT SPRINT AND VERIZON IN LATE 

2016, SO THAT WAS NEW BUSINESS FOR US BECAUSE WE DIDN'T HAVE 

CDMA BEFORE. 

IT PROBABLY ALSO HELPED A LOT IN CHINA. IT'S BECOME MORE 

AND MORE A REQUIRED FEATURE IN THE CHINA MARKET. SO HAVING IT 

WAS IMPORTANT IN THE CHINA MARKET OVER THE LAST COUPLE OF YEARS 

AS WELL. 

Q. WILL MEDIATEK CUSTOMERS WHO WANT TO PURCHASE A CDMA MODEM 

BE ABLE TO USE A NON-CDMA MODEM INSTEAD? 

A. MAYBE, TO BE MORE PRECISE, WE DON'T PRODUCE TODAY A 

STANDALONE CDMA MODEM. IT'S A MODEM MODE THAT'S ENABLED IN OUR 

MODEM CHIPS WITH LTE TO BE MORE PRECISE. 

BUT, NO, IF SOMEBODY NEEDS TO SUPPORT CDMA FOR A SPECIFIC 

NETWORK, LIKE VERIZON OR SPRINT OR THE CHINESE OPERATORS, THERE 

ISN'T AN ALTERNATIVE TO THAT. IT'S A STANDARD TECHNOLOGY. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 170 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN DIRECT BY MR. KEHL

UNITED STATES COURT REPORTERS

330

Q. HAVE YOU HEARD THE TERM MULTIMODE MODEM? 

A. YES.

Q. WHAT IS A MULTIMODE MODEM? 

A. GENERALLY IT'S, IT'S MEANT TO DESCRIBE THE MODEM 

CAPABILITY IS CAPABLE OF SUPPORTING DIFFERENT NETWORKS. SO, 

FOR EXAMPLE, 4G LTE, CDMA, 3G UMTS, 2G, DIFFERENT STANDARDS, 

DIFFERENT, QUOTE-UNQUOTE, "MODES." 

Q. WOULD A MODEM THAT SUPPORTS BOTH UMTS AND CDMA BE AN 

EXAMPLE OF A MULTIMODE MODEM? 

A. YES, IN MY DEFINITION, YES.

Q. WHAT IS A TWO-CHIP SOLUTION? 

A. I GUESS I, I TEND TO INTERPRET THAT AS SOMETHING THAT HAS 

SOME FUNCTIONALITY IMPLEMENTED ACROSS TWO DIFFERENT PIECES OF 

SILICON OR TWO DIFFERENT CHIPS RATHER THAN ONE.

Q. IF UMTS WERE ON ONE CHIP AND CDMA WERE ON A SEPARATE CHIP, 

WOULD THAT BE A TWO-CHIP SOLUTION? 

A. YES, I'D AGREE WITH THAT.

Q. IN YOUR VIEW, IS A TWO-CHIP SOLUTION AN ALTERNATIVE TO A 

MULTIMODE MODEM? 

A. I MEAN, FUNCTIONALLY IT CAN BE. IT MAY NOT BE VERY 

OPTIMAL, BUT IT CAN BE.

Q. WHAT ARE THE TRADEOFFS ASSOCIATED WITH IT? 

A. IN GENERAL, IT PROBABLY TAKES UP MORE SPACE IN THE PHONE. 

YOU KNOW, SPACE IS A PREMIUM FACTOR IN THE DESIGN OF PHONES 

THESE DAYS. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 171 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN DIRECT BY MR. KEHL

UNITED STATES COURT REPORTERS

331

SOMETIMES THERE HAS TO BE ADDITIONAL SUPPORTING CIRCUITRY, 

POWER MANAGEMENT, MEMORIES THAT SUPPORT EACH OF THOSE CHIPS 

PERHAPS DEPENDING ON HOW IT'S ARCHITECTED, AND THERE MAY BE 

HIGHER POWER CONSUMPTION. PROBABLY A NUMBER OF DISADVANTAGES I 

WOULD SAY. 

Q. AND HAVE YOU HEARD THE TERM BACKWARDS COMPATIBILITY IN THE 

CONTEXT OF MODEM CHIPS? 

A. YES, I HAVE.

Q. WHAT DOES THAT TERM MEAN? 

A. I INTERPRET IT TO MEAN THAT THE MULTIMODE MODEM IS CAPABLE 

OF RUNNING AT PREVIOUS GENERATIONS OF THE STANDARDS. SO A 4G 

MODEM CAN FALL BACK TO A 3G NETWORK IF THERE IS NO 4G NETWORK 

WHERE THE PHONE IS PRESENT OR WHERE THE MODEM IS PRESENT.

Q. IS BACKWARDS COMPATIBILITY IMPORTANT FOR 4G PHONES? 

A. YES, FOR -- AGAIN, IT DEPENDS ON THE OPERATOR, IT DEPENDS 

ONE THE REGION. BUT FOR THE VAST MAJORITY OF CASES, YES. 

Q. BEFORE MEDIATEK COMMERCIALIZED A MODEM CHIP COMPLIANT WITH 

THE CDMA STANDARD, WHICH OTHER FIRMS OFFERED CDMA MODEM CHIPS? 

A. QUALCOMM FOR SURE. OF COURSE VIA TELECOM, THE COMPANY I 

MENTIONED, THEY ALSO HAD A BUSINESS ACTUALLY SELLING CHIPS AT 

ONE POINT IN TIME AS WELL. I CAN'T THINK OF ANY OTHERS.

Q. SO BETWEEN 2008 WHEN YOU JOINED MEDIATEK AND 2015 WHEN 

MEDIATEK FIRST LAUNCHED A CDMA CHIP IN CERTAIN REGIONS, CAN YOU 

THINK OF ANY OTHER FIRMS WHO HAD CDMA MODEM CHIPS? 

A. THERE MAY HAVE BEEN ONE OR TWO SMALLER KOREAN COMPANIES 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 172 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN DIRECT BY MR. KEHL

UNITED STATES COURT REPORTERS

332

THAT I THINK WERE EITHER OUT OF BUSINESS OR GETTING OUT OF 

BUSINESS AROUND THE 2008 TIMEFRAME. CERTAINLY NOT SIGNIFICANT. 

BUT, NO, I CAN'T THINK OF ANY OTHERS. 

Q. AND, MR. MOYNIHAN, I'D LIKE TO REFER YOU TO A DOCUMENT IN 

THE BINDER OF EXHIBITS IN FRONT OF YOU THAT'S LABELED JX 0050. 

A. THE SMALLER BINDER?

Q. YES. 

A. JX 50?

Q. YES. 

A. OKAY. 

Q. WHAT IS THIS DOCUMENT, MR. MOYNIHAN? 

A. IT'S A CONTRACT OR AN AGREEMENT. IT'S ENTITLED 

"NON-EXHAUSTIVE CDMA ASIC AGREEMENT." 

Q. ARE YOU FAMILIAR WITH THIS AGREEMENT? 

A. YES, I'VE SEEN IT BEFORE.

Q. HOW DID YOU BECOME FAMILIAR WITH THE AGREEMENT? 

A. I WAS ASKED TO REVIEW IT AS PART OF MY ROLE AT MEDIATEK 

SOMETIME AFTER IT WAS SIGNED IN 2009. 

MR. KEHL: YOUR HONOR, WE MOVE TO ADMIT JX 0050 INTO 

EVIDENCE. 

MR. SHACHAM: NO OBJECTION, YOUR HONOR. 

THE COURT: IT'S ADMITTED. 

(JOINT EXHIBIT JX 0050 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE.

BY MR. KEHL:

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 173 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN DIRECT BY MR. KEHL

UNITED STATES COURT REPORTERS

333

Q. MR. MOYNIHAN, I'D LIKE TO REFER YOU TO PAGE 43 OF JX 0050? 

A. YEP, I'M THERE.

Q. AND DO YOU SEE THERE'S A SECTION 8 HERE TITLED 

NON-AUTHORIZED MANUFACTURERS? 

A. YES, I SEE THAT.

Q. WHAT IS A NON-AUTHORIZED PURCHASER? 

A. WE HAD SOME TRAINING ON THIS AFTER THE AGREEMENT WAS 

SIGNED. 

I RECALL IT MEANT AN ENTITY THAT WE WERE NOT ALLOWED TO 

SELL 3G CHIPSETS TO UNDER THE TERMS OF THE AGREEMENT.

Q. AND SO WHAT IS AN AUTHORIZED PURCHASER? 

A. I GUESS THE OPPOSITE. I BELIEVE THERE WAS A LIST OF NAMES 

THAT WERE PROVIDED ON A REGULAR BASIS OR IN SOME KIND OF 

FASHION FROM QUALCOMM TO MEDIATEK TO LIST COMPANIES THAT WERE, 

QUOTE-UNQUOTE, "AUTHORIZED PURCHASERS."

Q. AND WHO DID YOU UNDERSTAND THE AUTHORIZED PURCHASERS TO 

BE? 

A. I UNDERSTOOD IT TO BE COMPANIES THAT HAD A LICENSE 

AGREEMENT IN PLACE WITH QUALCOMM. 

Q. AND WHO DID YOU UNDERSTAND THE NON-AUTHORIZED PURCHASERS 

TO BE? 

A. I GUESS THE OPPOSITE, PEOPLE WHO DON'T, COMPANIES WHO 

DON'T.

Q. WHAT WAS MEDIATEK REQUIRED TO DO PURSUANT TO THIS 

AUTHORIZED PURCHASER REQUIREMENT? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 174 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN DIRECT BY MR. KEHL

UNITED STATES COURT REPORTERS

334

A. WE WERE, AS I RECALL, WE WERE ONLY ALLOWED TO SELL 3G 

CHIPSETS TO THE LIST OF NAMES THAT WERE ON THE AUTHORIZED 

PURCHASERS. 

I BELIEVE THERE WERE ALSO SOME OTHER CONDITIONS WHEREBY WE 

HAD TO NOTIFY QUALCOMM IF A NON -- SOMEBODY ELSE, OR SOMEBODY 

WHO WASN'T ON THE LIST CAME TO TRY TO PURCHASE 3G CHIPS FROM 

US. SO WE HAD SOME NOTIFICATION PROCEDURES I BELIEVE. 

Q. AFTER YOU NOTIFIED QUALCOMM, WERE YOU REQUIRED TO WAIT AT 

ALL BEFORE SELLING THAT FIRM MODEM CHIPS? 

A. I BELIEVE WE WOULDN'T HAVE BEEN ABLE TO SELL THEM CHIPS 

UNLESS THEY HAD BECOME A, QUOTE-UNQUOTE, "AUTHORIZED PURCHASER" 

AT SOME POINT IN THE FUTURE.

Q. WAS MEDIATEK REQUIRED TO DO ANYTHING ELSE PURSUANT TO THE 

AUTHORIZED PURCHASER REQUIREMENT? 

A. YES, WE HAD SOME REPORTING OBLIGATIONS TO QUALCOMM PER THE 

TERMS OF THE AGREEMENT. 

Q. REPORTING WHAT? 

A. WE HAD TO REPORT SPECIFIC QUANTITIES OF 3G CHIPSETS THAT 

WE WOULD HAVE SOLD TO EACH INDIVIDUAL NAME OR EACH INDIVIDUAL 

CUSTOMER ON THE LIST. 

Q. HOW, IF AT ALL, DID THE AUTHORIZED PURCHASER REQUIREMENT 

IMPACT MEDIATEK'S SALES OF MODEM CHIPS? 

A. I THINK IT HAD A, SORT OF A HEADWIND KIND OF AN EFFECT. 

IT BECAME PRETTY CLEAR AFTER THE AGREEMENT WAS SIGNED THAT WE 

SEEMED TO BE THE ONLY COMPETITOR IN THE INDUSTRY THAT WAS 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 175 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN DIRECT BY MR. KEHL

UNITED STATES COURT REPORTERS

335

OPERATING WITH THIS CONDITION, OR AT LEAST WE DIDN'T GET THE 

SENSE THAT OTHER OF OUR COMPETITOR, BESIDES QUALCOMM, OF 

COURSE, BUT OTHER COMPETITORS WERE OPERATING WITH A SIMILAR 

KIND OF CONDITION. 

SO IT BECAME SOMEWHAT OF A HEADWIND TO OUR BUSINESS, I 

BELIEVE.

Q. WHEN DID MEDIATEK FIRST START SHIPPING COMMERCIAL 

QUANTITIES OF 3G MODEM CHIPS? 

A. IT WOULD HAVE BEEN AFTER THIS AGREEMENT WAS SIGNED, SO 

VERY LATE 2009, EARLY 2010 MORE LIKELY.

Q. WAS THAT MODEM CHIP THE 6268? 

A. YEAH, THAT WAS OUR FIRST 3G WIDE BAND CDMA CHIP. 

Q. AND WHEN YOU SAY "WIDE BAND CDMA," YOU MEAN THAT CHIP IS 

COMBINED WITH UMTS, BUT NOT CDMA? IS THAT CORRECT? 

A. YEAH, THAT'S PROBABLY A FAIR DEFINITION. WIDE BAND CDMA 

IS LIKE ONE, FIRST STEP IN THE UMTS STANDARD IS HOW I THINK 

ABOUT IT. BUT IT'S DIFFERENT TO THE CDMA WE WERE TALKING ABOUT 

EARLIER.

Q. AND WHAT ROLE DID YOU PLAY IN MEDIATEK'S EFFORT TO SELL 

THE 6268? 

A. SO AFTER I JOINED MEDIATEK IN JANUARY OF 2008, MY ROLE WAS 

MOSTLY FOCUSSED ON PLANNING OUR MOBILE CHIPSET ROADMAP, SO THAT 

INCLUDED THE 3G PRODUCTS. IN FACT, THAT WAS A BIG PART OF THE 

FOCUS. 

SO DURING KIND OF 2008, 2009, EVEN A LITTLE LATER, I WAS 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 176 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN DIRECT BY MR. KEHL

UNITED STATES COURT REPORTERS

336

CERTAINLY ENGAGED WITH INTERNAL TEAMS, PLANNING THAT, DOING 

SOME COMPETITIVE ANALYSIS. 

AND ALSO ENGAGING WITH MOSTLY I WOULD SAY WHAT WE WOULD 

HAVE CALLED INTERNATIONAL, NON-CHINA CUSTOMERS TO PROMOTE OUR 

ROADMAP, UNDERSTAND WHAT THEIR REQUIREMENTS ARE, TRY TO MAKE 

SURE THAT OUR ROADMAP WOULD ADDRESS THOSE REQUIREMENTS. 

Q. WHEN WAS THE 6268 READY TO ENGAGE WITH CUSTOMERS? 

A. I MEAN, PROBABLY IN DIFFERENT STAGES, BUT IT WOULD HAVE 

PROBABLY BEEN READY EARLY FIRST HALF 2009. 

Q. WHAT DID YOU LEARN FROM CUSTOMERS ABOUT THEIR DESIRE TO 

SOURCE THE 6268 FROM MEDIATEK IN THE FIRST HALF OF 2009. 

A. IN GENERAL, DURING THAT PERIOD, 2008 INTO 2009, AND EVEN 

INTO 2009, THE KIND OF PREVAILING MESSAGE FROM ALL OF THE 

CUSTOMERS I ENGAGED WITH WAS THAT THEY EXPECTED US TO HAVE A 

LICENSE AGREEMENT WITH QUALCOMM BEFORE THEY WOULD CONSIDER 

PURCHASING 3G CHIPSETS FROM MEDIATEK. 

Q. AND HOW DID THIS IMPACT THE TIMING OF SALES OF 6268? 

A. WELL, AT THE TIME WE DIDN'T HAVE A LICENSE AGREEMENT WITH 

QUALCOMM. WE DIDN'T HAVE ANY AGREEMENT WITH QUALCOMM. SO IT 

SORT OF STALLED THE PROGRESS I WOULD SAY.

Q. DID MEDIATEK DO ANYTHING TO ALLEVIATE THESE CUSTOMER 

CONCERNS? 

A. I DON'T -- I PERSONALLY DIDN'T, BUT I KNOW SOMEBODY IN THE 

COMPANY REACHED OUT AT SOME POINT TO SEEK A LICENSE AGREEMENT 

FROM QUALCOMM.

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 177 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN DIRECT BY MR. KEHL

UNITED STATES COURT REPORTERS

337

Q. DID YOU AT ANY TIME FORM AN UNDERSTANDING AS TO THE PACE 

OF THESE NEGOTIATIONS WITH QUALCOMM? 

A. I WASN'T PERSONALLY INVOLVED IN THE NEGOTIATIONS. I WAS 

MORE INVOLVED IN THE PRODUCT PLANNING. BUT CERTAINLY FOR, YOU 

KNOW, SOME OF THIS TIME I WAS TRAVELLING BACK AND FORTH TO, TO 

TAIWAN HEADQUARTERS A LOT. 

THERE WAS A GENERAL SENSE I THINK THAT THEY WERE GOING 

SLOW. THEY WOULD HAVE LIKED TO HAVE -- WE WOULD HAVE LIKED IF 

THEY HAD GONE FASTER. WE FELT LIKE THEY WERE SORT OF MAYBE 

BEING SLOW.

Q. DO YOU KNOW WHAT AGREEMENT WAS ULTIMATELY REACHED, IF ANY?

A. I BELIEVE IT WAS SOMETHING CALLED A COVENANT NOT TO ASSERT 

AGREEMENT. 

Q. IS THAT A DIFFERENT AGREEMENT THAN THE ONE REFLECTED IN 

JX 0050? 

A. I BELIEVE THERE WERE TWO AGREEMENTS SIGNED AT THE SAME 

TIME.

Q. IF I COULD REFER YOU TO JX 0051. 

A. YEAH, THAT'S THE SECOND ONE.

Q. IS THIS THE SECOND AGREEMENT?

A. YES. 

MR. KEHL: YOUR HONOR, WE MOVE TO ADMIT JX 0051 INTO 

EVIDENCE. 

MR. SHACHAM: NO OBJECTION, YOUR HONOR. 

THE COURT: IT'S ADMITTED. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 178 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN DIRECT BY MR. KEHL

UNITED STATES COURT REPORTERS

338

(JOINT EXHIBIT JX 0051 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE.

BY MR. KEHL:

Q. HOW DID THE 6268 PERFORM IN THE MARKET? 

A. NOT VERY WELL I WOULD SAY. 

Q. TO WHAT DO YOU ATTRIBUTE THAT? 

A. MOSTLY I THINK IT WAS SORT OF COMING INTO THE MARKET LATE. 

IT WAS -- YOU KNOW, THESE THINGS TEND TO HAVE A SHELF LIFE. 

THE PACE OF INNOVATION MOVES PRETTY QUICKLY. 

BY THE TIME WE WERE REALLY PUSHING IT THE MARKET, THE 

REQUIREMENTS HAD MOVED ON FROM WHAT FEATURES THE 6268 COULD 

DELIVER.

Q. WAS THE 6268 BETTER POSITIONED IN EARLY 2009? 

A. PROBABLY, YES. 

Q. WHEN DID MEDIATEK FIND SUCCESS SELLING 3G MODEM CHIPS? 

A. THE NEXT WAVE OF 3G PRODUCTS WENT TO MARKET THE SECOND 

HALF OF 2011. 

Q. AND HOW, IF AT ALL, DID THE TIMING OF MEDIATEK'S SUCCESS 

IN 3G EFFECT THE ENTRY INTO 4G? 

A. WE WERE CERTAINLY NOT EARLY INTO 3G. WE WERE WORKING HARD 

TO CATCH UP. YOU KNOW, SOME OF THESE THINGS WITH THE 

AGREEMENTS AND THE NEGOTIATIONS TENDED TO DELAY OUR ENTRY. 

SO I THINK THE, THE POINT IN TIME WHERE WE SAW REVENUE IN 

3G, WE HAD ALSO SEEN A DECLINE IN OUR 2G BUSINESS IN 2009/'10. 

IT WAS PRETTY TOUGH TIME. THE REVENUE PROFITS WERE UNDER 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 179 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN DIRECT BY MR. KEHL

UNITED STATES COURT REPORTERS

339

PRESSURE. 

SO NOT BEING ABLE TO GENERATE PROFIT REVENUE ON 3G I THINK 

IMPACTED OUR ABILITY TO INVEST IN 4G. 

Q. EARLIER TODAY, MR. MOYNIHAN, YOU MENTIONED I BELIEVE 

TIER 1 OEM'S. 

DO YOU RECALL THAT? 

A. YES, I PROBABLY USED THAT TERM.

Q. WHAT BENEFITS, IF ANY, ACCRUED TO A MODEM CHIP SUPPLIER 

THAT SELLS TO TIER 1 OEM'S? 

A. I MEAN, SO TIER 1 OEM'S, BY VIRTUE OF THE NAME, I GUESS, 

ARE KIND OF THE TOP TIER SUPPLIERS. THEY TEND TO BE THE 

COMPANIES THAT HAVE, YOU KNOW, THE ADOPTION OF THE LATEST 

TECHNOLOGIES. THEY TEND TO BE THE ONES THAT ARE DOING THE, 

MAYBE THE MOST PRESTIGIOUS, MORE VISIBLE BUSINESS. THEY TEND 

TO HAVE, YOU KNOW, VERY STRONG INTERNAL R&D TEAMS. THEY GOT 

THERE FOR A REASON. 

SO I THINK WORKING WITH THOSE KIND OF COMPANIES MAKES US, 

AS A SUPPLIER, A BETTER SUPPLIER. 

Q. ARE THERE ANY PARTICULAR POINTS IN TIME WHEN THE BENEFITS 

OF WORKING WITH A TIER 1 OEM ARE MORE OR LESS IMPORTANT? 

A. I MEAN, YES. I THINK IT'S ALWAYS IMPORTANT, BUT I THINK 

POINTS OF INDUSTRY TRANSITION, SO FROM FEATURE PHONES TO 

SMARTPHONES OR FROM 2G TO 3G OR 3G TO 4G CAN BE QUITE CRITICAL 

TIMES BECAUSE THERE'S NEW NETWORKS ROLLING OUT, A LOT OF 

REQUIREMENTS. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 180 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN DIRECT BY MR. KEHL

UNITED STATES COURT REPORTERS

340

THE TIER 1S ARE OFTEN THE FIRST SUPPLIERS INTO THOSE NEW 

MARKETS OR THOSE TRANSITIONS. SO I THINK AS A SUPPLIER, WE 

TEND TO THINK THAT THEY CAN HELP US AS A SUPPLIER AND NAVIGATE 

SOME OF THOSE TRANSITIONS WITHOUT FALLING DOWN.

Q. CAN YOU THINK OF ANY PARTICULAR EXAMPLES OF THIS? 

A. SURE, YEAH. 

Q. CAN YOU PLEASE GIVE US ONE? 

A. I MEAN, ONE EXAMPLE I THINK OF IS WHEN WE WERE TRYING TO 

TRANSITION FROM 3G TO 4G AT AT&T IN THE U.S., WE HAD HAD SOME 

SUCCESS IN 3G WITH AT&T, OR ONE OF OUR CUSTOMERS HAD SOME 

SUCCESS, I SHOULD SAY, WITH AT&T IN 3G. SO WE WERE OBVIOUSLY 

TRYING TO TRANSLATE THAT INTO 4G SUCCESS. 

IT TURNS OUT AT THE TIME WE HAD BUILT A VERY INDUSTRY 

STANDARD, OR PER THE SPEC, 4G MODEM. 

AT&T'S NETWORK WAS A LITTLE -- OR HAD SOME UNIQUE 

REQUIREMENTS. THEY WEREN'T IN THE STANDARD, BUT THEY WERE 

OBVIOUSLY REQUIRED FOR AT&T. EVEN AT THE ENTRY TIER THEY WERE 

REQUIRED. 

OUR CHIPSET HADN'T THE FEATURE, WE DIDN'T HAVE THAT 

CAPABILITY TO SUPPORT THAT. SO IT KIND OF, I THINK, BLOCKED US 

FROM -- OR OUR CUSTOMERS FROM USING US TO SUPPORT PHONES ON 

AT&T'S NETWORK FOR MANY YEARS. 

Q. AT THE TIME MEDIATEK WAS MAKING THIS TRANSITION FROM 3G TO 

4G, HOW WOULD YOU DESCRIBE ITS COMMERCIAL RELATIONSHIPS WITH 

TIER 1 OEM'S? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 181 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN DIRECT BY MR. KEHL

UNITED STATES COURT REPORTERS

341

A. IT WAS -- I THINK IT WAS GROWING. WE HAD, I THINK, MADE 

SOME SUCCESS IN THE PREVIOUS YEARS IN TRANSLATING, YOU KNOW, 

SOME OF OUR SUCCESS IN 2G INTO NEW BUSINESS AT 3G, AND STARTED 

TO PENETRATE NEW OEM'S THAT WE HADN'T SUPPLIED IN 2G. 

Q. MR. MOYNIHAN, IN MEDIATEK'S SALES OF 4G MODEM CHIPS, ARE 

THERE ANY PARTICULAR BUSINESS CHALLENGES THAT THE FIRM FACES? 

A. I MEAN, I THINK THE CHALLENGES ARE SIMILAR DEPENDING ON 

THE SEGMENT, NOT RELATING TO 3G. I THINK 3G, 4G IS SIMILAR 

CHALLENGES, I THINK. 

Q. WHAT ARE THE TYPICAL COMPETITIVE CRITERIA IN THE SALE OF 

MODEM CHIPS? 

A. I MEAN, OBVIOUSLY WE TALKED A LITTLE BIT EARLIER ABOUT IT 

DEPENDS ON THE TIER OF PHONE THAT YOU'RE TARGETING, THE 

FEATURES. BUT IN ANY TIER THE FEATURES ARE IMPORTANT. YOU 

HAVE TO SUPPORT A CERTAIN MODEM FEATURE SET, LTE, CDMA, 

WHATEVER. YOU HAVE TO SUPPORT CERTAIN FREQUENCY BANDS. IF 

IT'S SOMETHING THAT'S GOING INTO THE U.S. MARKET, IT HAS TO 

SUPPORT THE FREQUENCY BANDS THAT THE U.S. CARRIERS ARE 

ADOPTING. 

SO FEATURES ARE ALWAYS IMPORTANT. 

YOU KNOW, SIZE AND POWER CONSUMPTION ARE ALWAYS CRITICAL, 

AND I GUESS PRICE IS ALWAYS A FACTOR. 

Q. DO YOU PERCEIVE THERE TO BE ANY ADDITIONAL FACTORS AT 

ISSUE IN COMPETITION WITH QUALCOMM? 

A. IT CERTAINLY FEELS LIKE THAT SOME DAYS, YES.

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 182 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN DIRECT BY MR. KEHL

UNITED STATES COURT REPORTERS

342

Q. WHAT ARE THOSE FACTORS? 

A. WELL, WE ALL KNOW THAT, YOU KNOW, QUALCOMM HAS THIS 

LICENSING BUSINESS THAT SORT OF TENDS TO GIVE THEM A LARGE 

FINANCIAL TRANSACTION BETWEEN THE SAME COMPANY THAT THEY'RE 

SUPPLYING CHIPS TO. 

YOU KNOW, WE SOMETIMES FEEL, IN THE COMPETITION 

ENVIRONMENT, IT'S A LITTLE BIT LIKE COMPETING WITH ONE HAND 

TIED BEHIND YOUR BACK. THERE ARE SORT OF OTHER FINANCIAL 

CONSIDERATIONS, OTHER INCENTIVES THAT WHEN THE OEM LOOKS AT THE 

PICTURE, THE TOTAL COST OF OWNERSHIP IS SOMETHING THAT'S VERY 

HARD FOR US TO COMPETE WITH SOMETIMES. 

MR. KEHL: YOUR HONOR, AT THIS TIME WE'RE GOING TO 

MOVE TO THE DOCUMENTS THAT WERE SUBJECT TO THE COURT'S SEALING 

ORDER. 

THE COURT: OKAY. SO WHY DON'T WE ALSO HANDLE THE 

PUBLIC PORTION OF THE CROSS. IT'S 3:05.

MR. SHACHAM: MY NAME IS MATAN SHACHAM FROM QUALCOMM. 

MAY I HAVE A MOMENT TO PASS OUT BINDERS, PLEASE? 

THE COURT: YES. 

(PAUSE IN PROCEEDINGS.) 

MR. SHACHAM: YOUR HONOR, WHAT I'VE HANDED YOU IS THE 

ONE EXHIBIT, AND THE WHITE BINDER IS THE DEPOSITION TRANSCRIPTS 

FOR EASE OF REFERENCE. 

THE COURT: OKAY. THANK YOU. 

IT'S 3:07. GO AHEAD, PLEASE. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 183 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

343

CROSS-EXAMINATION

BY MR. SHACHAM:

Q. GOOD AFTERNOON, MR. MOYNIHAN. 

A. GOOD AFTERNOON.

Q. MEDIATEK STARTED COMMERCIAL SALES OF ITS CDMA CHIPS AROUND 

2010; CORRECT? 

A. THAT'S CORRECT.

Q. AND THAT CHIP WAS CALLED THE MT 6268; RIGHT? 

A. THAT'S CORRECT.

Q. IN 2010, COMPETITION IN THE SMARTPHONE INDUSTRY WAS VERY 

HIGH; IS THAT FAIR TO SAY? 

A. THERE WERE CERTAINLY MULTIPLE SUPPLIERS, YES.

Q. WOULD YOU SAY IT'S FAIR TO SAY THAT COMPETITION WAS VERY 

HIGH AT THAT POINT? 

A. I THINK SO, YES. 

Q. IN 2010, THERE WAS ALSO VERY HIGH COMPETITION IN THE 

SMARTPHONE CHIP VENDOR MARKET; IS THAT FAIR TO SAY? 

A. I'M SORRY. WHAT TIMEFRAME?

Q. IN 2010. 

A. THERE WERE ALSO A NUMBER OF SUPPLIERS OF CHIPSETS FOR 

SMARTPHONES, YES.

Q. SO COMPETITION IN 2010 IN THE CHIP VENDOR MARKET WAS VERY 

HIGH; CORRECT?

A. YES, THERE WERE A NUMBER OF SUPPLIERS, YES.

Q. SO MEDIATEK HAD TO COMPETE WITH QUALCOMM WHEN IT ENTERED 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 184 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

344

THE WCDMA MARKET; RIGHT? 

A. YES. 

Q. IT HAD TO COMPETE WITH INFINEON? 

A. YES, I BELIEVE THEY WERE STILL ACTIVE THEN, YES.

Q. ALSO HAD TO COMPETE WITH ERICSSON? 

A. THE NAME MIGHT HAVE CHANGED A LITTLE, BUT ERICSSON EMP, 

YES.

Q. IN FACT, YOU TESTIFIED PREVIOUSLY THAT THERE WERE POSSIBLY 

OTHER WCDMA COMPETITORS AT THAT TIME AS WELL; CORRECT? 

A. 2010? YES, THERE PROBABLY STILL -- YEAH, THERE WERE 

OTHERS AT THE TIME, YES.

Q. MEDIATEK FIRST INTRODUCED AN LTE CHIP IN 2014; IS THAT 

RIGHT? 

A. YES, THAT'S CORRECT. 

Q. AND BY 2016, MEDIATEK'S SHARE OF THE OVERALL LTE CHIP 

MARKET HAD INCREASED SIGNIFICANTLY? IS THAT FAIR TO SAY? 

A. FROM NOTHING IN 2014, I THINK THAT'S PROBABLY FAIR. 

Q. IN FACT, BY MARCH 2016, MEDIATEK WAS THE NUMBER TWO CHIP 

SUPPLIER IN THE WORLD FOR SMARTPHONES BY VOLUME, WASN'T IT? 

A. BY VOLUME IN 2016, YEAH, THAT WOULD BE PROBABLY CORRECT. 

Q. AND THAT REMAINED THE CASE AS OF MARCH 2018 WHEN YOU WERE 

DEPOSED IN THIS CASE; RIGHT? 

A. YEAH, THAT WOULDN'T SURPRISE ME. 

Q. SO MEDIATEK HAS SIGNIFICANTLY IMPROVED ITS COMPETITIVE 

POSITION IN THE SMARTPHONE CHIP VENDOR MARKET SINCE 2010; 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 185 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

345

CORRECT? 

A. I MEAN, SINCE WE SHIPPED NOTHING IN SMARTPHONES IN 2010, I 

THINK THAT'S FAIR. I THINK WE'RE SHIPPING MORE NOW, YES.

Q. SO IT'S SIGNIFICANTLY IMPROVED ITS POSITION? 

A. FROM ZERO, SURE.

Q. AND THAT'S TRUE IN TERMS OF BOTH MARKET SHARE AND REVENUE; 

RIGHT? 

A. YEAH. BY REVENUE IT WOULD BE SMALLER, BUT BY MARKET 

SHARE, YEAH. 

Q. SO IT'S IMPROVED IN BOTH OF THOSE AREAS? 

A. AGAIN, WE'RE COMING FROM A BASE OF ZERO IN 2010 IN 

SMARTPHONES. IT'S ALL RELATIVE I GUESS.

Q. SINCE 2010, MEDIATEK HAS ALSO SUBSTANTIALLY CLOSED ANY GAP 

BETWEEN WHERE IT'S SITUATED FROM A TECHNICAL STANDPOINT AND 

WHERE OTHERS IN THE INDUSTRY ARE. IS THAT FAIR TO SAY? 

A. I THINK THAT DEPENDS ON WHAT DIMENSION OF TECHNOLOGY 

YOU'RE TALKING ABOUT. IT'S TOO BROAD TO LUMP INTO ONE.

Q. DO YOU RECALL BEING DEPOSED IN MARCH OF 2018? 

A. YES. 

Q. AND YOU WERE UNDER OATH AT THAT TIME? 

A. YES. 

Q. I'D LIKE TO PLAY A CLIP FROM YOUR DEPOSITION. IT'S 

PAGE 36, LINE 25, THROUGH 11, LINE 8. 

(A VIDEOTAPE WAS PLAYED IN OPEN COURT OFF THE RECORD.) 

BY MR. SHACHAM:

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 186 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

346

Q. YOU GAVE THAT -- YOU WERE ASKED THAT QUESTION AND YOU GAVE 

THAT ANSWER; CORRECT, SIR? 

A. SURE.

Q. AND YOU STAND BY THAT TESTIMONY TODAY? 

A. YES.

Q. AND YOU ATTRIBUTE MEDIATEK'S SUCCESS IN THE MARKET OVER 

THE PAST EIGHT YEARS TO THE FACT THAT MEDIATEK MAKES AND SELLS 

HIGH QUALITY PRODUCTS; IS THAT CORRECT? 

A. YES, I THINK THAT'S FAIR. 

Q. YOU TESTIFIED EARLIER THAT MEDIATEK OBTAINED CDMA 

CAPABILITY AROUND 2012 OR 2013; IS THAT RIGHT? 

A. YEAH, I -- I DON'T REMEMBER THE EXACT DATE. I THOUGHT IT 

WAS AROUND 2013.

Q. AND IT DID SO BY LICENSING CDMA TECHNOLOGY FROM A COMPANY 

CALLED VIA TELECOM; IS THAT RIGHT? 

A. THAT'S CORRECT. 

Q. MEDIATEK CONSIDERED LICENSING VIA'S CDMA TECHNOLOGY AS 

EARLY AS 2008; RIGHT? 

A. UM, I DON'T KNOW SPECIFICALLY IF WE CONSIDERED LICENSING 

VIA. I KNOW WE CONSIDERED LICENSING CDMA I.P. BACK IN 2008, 

AROUND THAT TIMEFRAME, YES. 

Q. BUT MEDIATEK MADE A BUSINESS DECISION TO WAIT; RIGHT? 

A. I WASN'T INVOLVED IN THE DECISION. BUT WE DIDN'T LICENSE 

IT AT THE TIME. 

Q. DO YOU RECALL GIVING TESTIMONY IN AN INVESTIGATIVE HEARING 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 187 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

347

IN THIS MATTER AROUND SEPTEMBER 2016, SIR? 

A. VAGUELY.

Q. COULD YOU PLEASE TURN TO THE BINDER IN FRONT OF YOU, IT'S 

THE WHITE ONE. 

A. THIS ONE? OH, THE WHITE ONE. 

Q. THE WHITE ONE, PLEASE. 

A. YEP.

Q. AND THERE'S A TAB IN THERE FOR I.H. TRANSCRIPT. 

A. YEP.

Q. CAN YOU PLEASE TURN, SIR, TO PAGE 204 OF THAT TRANSCRIPT. 

A. YEP. 

Q. AND DO YOU SEE THERE, YOU WERE ASKED THE QUESTION, "SO IF 

ENABLING CDMA ALLOWED MEDIATEK TO POTENTIALLY ADDRESS UP TO 70 

PERCENT OF THE U.S. MARKET, WHY DIDN'T MEDIATEK CONSIDER 

LICENSING VIA CDMA TECHNOLOGY EARLIER IN TIME?" 

AND YOU START YOUR ANSWER, "WE DID ACTUALLY -- SO IT WAS 

FAR BACK AS 2008." AND THEN YOU CONTINUE AT LINE 14, "I THINK 

ULTIMATELY WE DECIDED THAT IT WASN'T THE RIGHT TIME TO DO IT 

BECAUSE WE WERE STILL TRYING TO, YOU KNOW, GET INTO 3G, YOU 

KNOW, FIGHT THAT FIRE, STABILIZE THAT. 

"SO THE DECISION I THINK BECAME ONE OF A BUSINESS 

DECISION. IN MANY CASES, IT'S A MAKE-OR-BUY KIND OF DECISION." 

DO YOU STAND BY THAT TESTIMONY TODAY? 

A. YEAH. I THINK I WAS EXTRAPOLATING WHAT THE DECISION WAS. 

I WASN'T INVOLVED. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 188 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

348

Q. BUT YOUR UNDERSTANDING IS THAT IT WAS A BUSINESS DECISION? 

A. IT WAS A DECISION NOT TO LICENSE IT AT THE TIME, YES. 

Q. AND MEDIATEK MADE THAT BUSINESS DECISION BECAUSE IT WANTED 

TO FOCUS ON OTHER 3G TECHNOLOGY FIRST; RIGHT? 

A. YEAH, I THINK THAT'S FAIR. WE WERE CERTAINLY PUTTING 

PRIORITY ON WIDE BAND CDMA AT THE TIME. 

Q. MEDIATEK HAD THE CAPABILITY IN-HOUSE TO DESIGN AND DEVELOP 

ITS OWN MODEM TO IMPLEMENT THE CDMA FUNCTION; CORRECT? 

A. YEAH, I BELIEVE WE COULD HAVE, YES.

Q. BUT MEDIATEK DECIDED THAT IT WOULD BE MORE EXPEDIENT TO 

TAKE THE VIA LICENSE THAN TO DEVELOP ITS OWN CDMA MODEM; RIGHT? 

A. YEAH. I BELIEVE ULTIMATELY THAT THE DECISION WAS MADE 

THAT IT WAS PROBABLY FASTER TO LICENSE ON THE PHYSICAL I.P. 

FROM ANOTHER COMPANY THAT HAD SOME PROVEN RECORD. 

Q. AS OF MARCH 2018, MEDIATEK WAS WORKING TO DEVELOP 5G MODEM 

CHIPS; RIGHT? 

A. BY MARCH 2018 YOU SAID?

Q. YES, SIR. 

A. YES, THAT'S CORRECT. 

Q. MR. MOYNIHAN, YOU TESTIFIED EARLIER ABOUT THE AGREEMENT 

THAT QUALCOMM AND MEDIATEK ENTERED INTO IN 2009, OR I GUESS IT 

WAS TWO AGREEMENTS; RIGHT? 

A. YEAH, I BELIEVE THERE WERE TWO, YES. 

Q. YOU WERE NOT INVOLVED IN ANY WAY IN THE NEGOTIATION OF 

THAT AGREEMENT; RIGHT? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 189 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

349

A. NO, I WAS NOT.

Q. YOU WERE NOT INVOLVED IN DISCUSSIONS OF ANY KIND WITH 

ANYBODY FROM QUALCOMM LEADING UP TO THAT 2009 AGREEMENT? 

A. NO, I WAS NOT.

Q. YOU WERE NOT ASKED TO PROVIDE ANY SORT OF BUSINESS ADVICE 

TO OTHERS AT MEDIATEK AS PART OF NEGOTIATION OF THAT AGREEMENT? 

A. NOTHING THAT I CAN -- NOT THAT I CAN REMEMBER, NO.

Q. AND YOU WERE NOT ASKED TO REVIEW ANY DRAFTS OF THAT 

AGREEMENT BEFORE IT WAS SIGNED; RIGHT? 

A. NO, I WAS NOT. 

Q. SO YOU DIDN'T EVEN READ THAT AGREEMENT UNTIL AFTER IT WAS 

SIGNED; RIGHT?

A. THAT'S CORRECT. 

Q. PROBABLY ONE OR TWO YEARS AFTER IT WAS SIGNED; IS THAT 

RIGHT? 

A. 2010, MAYBE EARLY 2011, SOMETHING LIKE THAT.

Q. THAT'S ABOUT ONE OR TWO YEARS? 

A. YEAH. 

Q. THE PERSON WHO LED THOSE NEGOTIATIONS FOR MEDIATEK WAS A 

GENTLEMAN NAMED DAVID CHANG; IS THAT RIGHT? 

A. THAT'S MY UNDERSTANDING, YES.

Q. AND YOU'RE AWARE THAT SHORTLY BEFORE THAT DEAL WAS SIGNED, 

MR. CHANG SAID THE DEAL WAS DEFINITELY A WIN-WIN CASE FOR BOTH 

COMPANIES; CORRECT? 

A. HE MAY HAVE, YES.

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 190 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

350

Q. AND YOU'RE AWARE OF THAT? 

A. I THINK SO. I THINK I MAY HAVE SEEN AN E-MAIL SOMEWHERE 

ALONG THE WAY.

Q. BUT YEARS AFTER MR. CHANG DECLARED THAT THE 2009 AGREEMENT 

WAS A WIN-WIN DEAL, YOU DECIDED THAT THIS WAS ACTUALLY A BAD 

DEAL FOR MEDIATEK; RIGHT? 

A. YEAH, I THINK I HAD A DIFFERENT OPINION. 

Q. AND SPECIFICALLY, YOU TESTIFIED EARLIER THAT YOU BELIEVED 

THAT THE AGREEMENT BURDENED MEDIATEK BECAUSE IT CONTAINED AN 

AUTHORIZED PURCHASER PROVISION; IS THAT RIGHT? 

A. AMONG OTHER THINGS, YES. 

Q. AND ACCORDING TO YOU, THERE MAY HAVE BEEN CUSTOMERS 

INTERESTED IN PURSUING 3G DESIGNS THAT WERE NOT ON THE 

AUTHORIZED PURCHASER LIST; IS THAT RIGHT? 

A. THE INDUSTRY CONTEXT I THINK IS IMPORTANT. IT WAS THE 

POINT IN TIME WHERE I THINK A LOT OF OUR LEGACY 2G FEATURE 

PHONE CUSTOMERS WERE PROBABLY EXPLORING ENTRY INTO THE 3G 

MARKET. 

Q. SO THERE MAY HAVE BEEN CUSTOMERS THAT WERE INTERESTED IN 

PURSUING 3G DESIGNS THAT WERE NOT ON THE AUTHORIZED PURCHASER 

LIST? 

A. YES, THERE WERE, YES.

Q. AND THOSE HYPOTHETICAL CUSTOMERS WOULD HAVE BEEN OEM'S 

THAT DID NOT HAVE A LICENSE AGREEMENT WITH QUALCOMM; CORRECT? 

A. I THINK PER THE DEFINITION, YES. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 191 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

351

Q. FAIR TO SAY THAT ANY SUCH UNLICENSED OEM'S WERE TYPICALLY 

SMALLER COMPANIES IN CHINA OR OTHER DEVELOPING COUNTRIES? 

A. YEAH, I THINK THAT'S A REASONABLE EXTRAPOLATION. 

Q. QUALCOMM AND MEDIATEK ENTERED INTO A NEW AGREEMENT IN 

2013; CORRECT? 

A. YES. 

Q. AND THAT AGREEMENT REMOVED THE AUTHORIZED PURCHASER 

PROVISION COMPLETELY; RIGHT? 

A. YES, I BELIEVE SO. 

Q. BUT AS OF THE TIME OF YOUR DEPOSITION, YOU COULDN'T 

IDENTIFY ANY NEW OEM'S THAT MEDIATEK WAS ABLE TO SELL TO ONCE 

THAT PROVISION WAS REMOVED; CORRECT? 

A. THAT COULD BE TRUE. 

BY 2013, I WAS LIVING BACK IN THE U.S. I WASN'T SO 

ACTIVELY INVOLVED IN THE DIRECT SALES TO OEM'S IN THE MOBILE 

BUSINESS. MY ROLE WAS A LITTLE DIFFERENT.

Q. SO YOU COULDN'T IDENTIFY ANY NEW OEM'S THAT MEDIATEK WAS 

ABLE TO SELL TO ONCE THE AUTHORIZED PURCHASER PROVISION WAS 

REMOVED; CORRECT? 

A. PERHAPS NOT, NO. 

Q. AND YOU DIDN'T KNOW ONE WAY OR THE OTHER WHETHER MEDIATEK 

BEGAN TO SELL TO ANY OEM'S WHO WERE NOT ON THE AUTHORIZED 

PURCHASER LIST AFTER THE NEW AGREEMENT WAS SIGNED; CORRECT? 

A. NO. I KNOW OUR BUSINESS IN 3G IMPROVED IN THAT TIMEFRAME. 

BUT AS I SAID, I WASN'T SO DIRECTLY -- MOST OF THOSE SALES 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 192 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

352

WOULD HAVE BEEN HANDLED BY OUR CHINA SALES TEAM. I DIDN'T HAVE 

A ROLE IN THAT TEAM, SO I WASN'T SO DIRECTLY INVOLVED.

Q. SO YOU DIDN'T KNOW ONE WAY OR THE OTHER WHETHER MEDIATEK 

BEGAN TO SELL TO ANY OEM'S THAT WERE NOT ON THE AUTHORIZED 

PURCHASER LIST? 

A. I NEVER CHECKED OR CROSS-CHECKED.

Q. SO YOU HAVE NO KNOWLEDGE? 

A. NO KNOWLEDGE. 

Q. YOU ALSO TESTIFIED THAT YOU BELIEVE THAT THE 2009 

AGREEMENT BURDENED MEDIATEK BECAUSE OF A CUSTOMER-BY-CUSTOMER 

SALES REPORTING PROVISION; IS THAT RIGHT? 

A. YES.

Q. AND THAT PROVISION REQUIRED MEDIATEK TO REPORT THE NUMBER 

OF CHIPS IT SOLD TO EACH AUTHORIZED PURCHASER? 

A. YES. 

Q. IT'S TRUE, IS IT NOT, THAT THAT INFORMATION IS SOMETHING 

THAT MEDIATEK ALREADY MAINTAINED AT THE TIME IN THE ORDINARY 

COURSE OF BUSINESS? 

A. YEAH, IT'S CERTAINLY INFORMATION WE WOULD KNOW WHO WE 

SHIPPED PRODUCTS TO, YES.

Q. AND IT'S ALSO TRUE THAT NO CUSTOMER EVER TOLD YOU THAT 

THEY CARED ABOUT MEDIATEK REPORTING THAT INFORMATION TO 

QUALCOMM; RIGHT?

A. I DON'T RECALL ANY OF THEM SAYING THAT TO ME PERSONALLY, 

NO. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 193 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

353

Q. AND THE NEW AGREEMENT IN 2013 REMOVED THAT 

CUSTOMER-BY-CUSTOMER REPORTING PROVISION, TOO; CORRECT? 

A. YES, AND I THINK IT REPLACED IT WITH SOME KIND OF 

AGGREGATE REPORTING REQUIREMENT.

Q. BUT THE CUSTOMER-BY-CUSTOMER PORTION WAS GONE; RIGHT? 

A. YEAH, IT WAS AGGREGATED BY CHIPSET.

Q. MR. MOYNIHAN, BOTH THE 2009 AGREEMENT AND THE 2013 

AGREEMENT HAVE NOW EXPIRED; RIGHT? 

A. THAT'S MY UNDERSTANDING, YES.

Q. AND AS OF MARCH 2018 WHEN YOU WERE DEPOSED, YOU COULDN'T 

POINT TO ANY EFFECT THAT THE EXPIRATION OF THOSE AGREEMENTS HAD 

HAD ON MEDIATEK'S BUSINESS; CORRECT? 

A. I DON'T THINK SO. 

Q. YOU COULD NOT POINT TO ANY SUCH EFFECT; CORRECT? 

A. I DON'T THINK SO. 2018, YOU SAID?

Q. AS OF 2018. 

A. MARCH? YEAH. I MEAN, I THINK THERE WERE, LIKE I SAID, 

POINTS IN TIME WHERE OUR 3G BUSINESS DEFINITELY SAW SOME GROWTH 

AFTER THE FIRST AGREEMENT EXPIRED. I DON'T KNOW THAT THEY WERE 

NECESSARILY CLOSELY RELATED, BUT THERE WAS SOME EFFECT. 

Q. I'D LIKE TO PLAY PAGE 242, LINES 17 THROUGH 21, PLEASE. 

(A VIDEOTAPE WAS PLAYED IN OPEN COURT OFF THE RECORD.) 

BY MR. SHACHAM:

Q. YOU WERE ASKED THAT QUESTION AND YOU GAVE THAT ANSWER; 

CORRECT? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 194 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

354

A. CORRECT.

Q. AND YOU STAND BY THAT TESTIMONY TODAY? 

A. SURE.

Q. YOU ALSO TESTIFIED THAT YOU THOUGHT THE NEGOTIATIONS FOR 

THE 2009 AGREEMENT TOOK TOO LONG; RIGHT? 

A. THAT'S THE PERCEPTION I HAD FROM INTERNAL DISCUSSIONS AT 

THE TIME, YES.

Q. AND YOU BELIEVE THAT THE LENGTH OF THE NEGOTIATIONS 

DELAYED MEDIATEK'S ABILITY TO SELL ITS FIRST WCDMA CHIP, THE 

MT 6268; RIGHT?

A. WHAT I BELIEVE IS OUR CUSTOMERS WERE NOT WILLING TO BUY A 

CHIP, A 3G CHIPSET FROM MEDIATEK UNTIL WE HAD A, IN THEIR 

WORDS, A LICENSE AGREEMENT WITH QUALCOMM. 

Q. BUT, AGAIN, YOU WEREN'T INVOLVED IN ANY WAY IN THOSE 

NEGOTIATIONS; RIGHT?

A. THAT'S CORRECT.

Q. AND IT'S TRUE, IS IT NOT, THAT THERE WERE INTERNAL DELAYS 

IN THE DEVELOPMENT OF THE MT 6268 CHIPSET THAT HAD NOTHING TO 

DO WITH QUALCOMM'S LICENSING NEGOTIATIONS? 

A. THERE WERE CERTAINLY -- I MEAN, IT'S OUR FIRST 3G PRODUCT. 

IT'S A COMPLEX TECHNOLOGY. I WOULDN'T BE SURPRISED IF THERE 

WERE DELAYS, OTHER ISSUES WITH THE PROJECT AS WELL. 

Q. AND THOSE WERE DELAYS THAT HAD NOTHING TO DO WITH ANY 

NEGOTIATIONS WITH QUALCOMM; RIGHT? 

A. YEAH, THOSE WOULD HAVE BEEN SEPARATE.

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 195 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

355

Q. FOR EXAMPLE, THE INTEGRATION OF THE ADI OTHELLO RF 

TRANSCEIVER RESULTED IN A DELAY IN THE DEVELOPMENT SCHEDULE FOR 

THE MT 6268; ISN'T THAT RIGHT? 

A. I'D CHARACTERIZE IT A LITTLE DIFFERENTLY. THIS IS A 

DECISION THAT WAS MADE AFTER THE ACQUISITION OF THE ANALOG 

DEVICES TEAM. THE DECISION WAS MADE SOMETIME IN 2008 TO ADOPT 

THE TRANSCEIVER THAT WAS ACQUIRED WITH THE ADI ACQUISITION. 

THAT, BY ITSELF, WOULD HAVE NECESSITATED SOME CHANGE IN THE 

PRODUCT, REWORKING OF THINGS. THAT WOULD HAVE TAKEN SOME TIME.

Q. AND THAT CAUSED SOME DELAY; RIGHT? 

A. IT CERTAINLY WOULD HAVE TAKEN TIME, YES.

Q. AND THAT DELAY HAD NOTHING TO DO WITH ANY QUALCOMM 

NEGOTIATIONS? 

A. NO. THAT DECISION WAS INDEPENDENT OF QUALCOMM. 

Q. AS OF MARCH 2018, MR. MOYNIHAN, IT WAS YOUR UNDERSTANDING 

THAT ALL STANDARD ESSENTIAL PATENTS ARE TYPICALLY LICENSED BY 

THE PATENT HOLDERS TO THE HANDSET MANUFACTURERS; CORRECT? 

A. YES. FOR THE CELLULAR INDUSTRY, I THINK THAT'S BEEN THE 

COMMON PRACTICE FOR A WHILE. 

Q. THAT WAS INDUSTRY PRACTICE? 

A. YEAH, COMMON PRACTICE FOR THE -- JUST FOR THE CELLULAR 

INDUSTRY, YES.

Q. FOR EXAMPLE, WHEN YOU NEGOTIATED WITH NOKIA, THEY WENT OUT 

OF THEIR WAY TO MAKE IT ABSOLUTELY CLEAR THAT THEY WERE NOT 

LICENSING THEIR ESSENTIAL PATENTS TO YOU AT THE CHIPSET LEVEL; 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 196 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

356

ISN'T THAT RIGHT? 

A. THE NEGOTIATIONS I THINK YOU'RE REFERRING TO WITH NOKIA 

WERE A MASTER PURCHASE AGREEMENT. IT WASN'T A LICENSING 

AGREEMENT DISCUSSION. 

BUT I DO RECALL, BY NECESSITY OF THE MASTER PURCHASE 

AGREEMENT, THERE ARE CERTAIN TERMS DEALING WITH I.P. 

I DO RECALL NOKIA SPECIFICALLY ADDING LANGUAGE TO MAKE IT 

CLEAR THAT THIS WAS NOT A, AN ESSENTIAL PATENT LICENSE TO 

MEDIATEK AT THE TIME.

Q. SO WHEN YOU NEGOTIATED WITH NOKIA, THEY WENT OUT OF THEIR 

WAY TO MAKE IT ABSOLUTELY CLEAR THAT THEY WERE NOT LICENSING 

THEIR ESSENTIAL PATENTS TO YOU AT THE CHIPSET LEVEL; ISN'T THAT 

RIGHT? 

A. YEAH, I THINK THAT'S WHAT I SAID, YEAH. 

Q. AS OF MARCH 2018, IT WAS YOUR UNDERSTANDING THAT 

RESPONSIBILITY FOR GETTING THE NECESSARY LICENSING FOR 

ESSENTIAL PATENTS RESTED WITH THE HANDSET MANUFACTURER; 

CORRECT? 

A. I THINK THAT'S HOW I UNDERSTOOD THE INDUSTRY OPERATED IN 

THE CELLULAR SPACE, YES.

Q. SO THAT WAS AN INDUSTRY PRACTICE? 

A. I THINK THAT'S HOW IT WAS OPERATING, YES. 

Q. AND, IN FACT -- 

A. IS -- I THINK I SAID HOW IT WAS, OR IS OPERATING. SORRY. 

Q. THAT'S HOW IT IS OPERATING STILL? 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 197 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

357

A. I BELIEVE SO, YES.

Q. AND, IN FACT, YOU RELAYED THESE UNDERSTANDS THAT YOU HAD 

ABOUT THE INDUSTRY TO YOUR TEAM IN AN E-MAIL CHAIN IN 2014. 

DO YOU RECALL THAT? 

A. YES, VAGUELY.

Q. OKAY. PLEASE TAKE A LOOK, PLEASE, SIR, AT THE BLACK 

BINDER, THE VERY SMALL ONE. AND YOU'LL FIND IN THERE A SINGLE 

DOCUMENT THAT'S BEEN MARKED QX 219. 

A. YES, I SEE IT. 

Q. THIS IS AN E-MAIL THAT YOU SENT TO YOUR TEAM ON MAY 8, 

2014; CORRECT? 

A. JUST TO BE 100 PERCENT CORRECT, NOT EVERYBODY IS ON MY 

TEAM, OR WAS ON MY TEAM. BUT SOME OF THEM WERE.

Q. SO THIS IS AN E-MAIL THAT YOU SENT TO MEMBERS OF YOUR TEAM 

ON MAY 8TH, 2014; RIGHT? 

A. AND SOME ADDITIONAL PEOPLE, YES. 

MR. SHACHAM: YOUR HONOR, I'D LIKE TO MOVE QX 219 

INTO EVIDENCE. 

THE COURT: ANY OBJECTION? 

MR. KEHL: NO OBJECTION, YOUR HONOR. 

THE COURT: IT'S ADMITTED. 

(DEFENDANT'S EXHIBIT QX 219 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. SHACHAM:

Q. MR. MOYNIHAN, WOULD YOU PLEASE TURN TO THE E-MAIL DATED 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 198 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

358

MARCH 6TH, 2014, AT 9:15 P.M. FROM RAYMOND KIM TO YOU AND 

OTHERS. IT'S TOWARDS THE BACK. 

A. MARCH 6TH, YOU SAID 9:15?

Q. YES, SIR. 

A. YEAH, I HAVE IT. 

Q. AND MR. KIM IS A MEMBER OF YOUR TEAM IN THE U.S.; IS THAT 

RIGHT? 

A. HE IS, AND HE WAS AT THE TIME, YES. 

Q. MR. KIM WAS REPORTING ON A CALL THAT HE HAD HAD WITH ZTE 

ABOUT MEDIATEK POTENTIALLY SUPPLYING CHIPS TO ZTE FOR A PHONE 

ON THE T-MOBILE NETWORK; IS THAT RIGHT? 

A. YEAH, THAT SEEMS CORRECT. 

Q. AND MR. KIM REPORTED THAT ZTE SAID T-MOBILE HAD CONCERNS 

ABOUT THE INTELLECTUAL PROPERTY IMPLICATIONS OF USING MEDIATEK 

CHIPS; RIGHT? 

A. YEAH, I SEE THAT.

Q. AND YOU RESPONDED TO MR. KIM THAT YOU THINK T-MOBILE 

SHOULD NOT HAVE THOSE CONCERNS. IS THAT FAIR TO SAY? 

A. I THINK THAT'S WHAT I WAS TRYING TO TEASE OUT, YES.

Q. OKAY. WELL, TURN BACK TO THE NEXT E-MAIL IN TIME, WHICH 

IS ON THE PRIOR PAGE, THE E-MAIL YOU SENT DATED MARCH 7, 2014, 

AT 7:58. 

A. OKAY, SORRY. YEAH, I SEE IT. 

Q. AND SO YOU WROTE THERE AT THE TOP OF THE E-MAIL, "RAYMOND, 

THANKS. IF YOU ARE IN THE OFFICE TODAY, GIVE ME A CALL ON THIS 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 199 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

359

IPR TOPIC, I'D LIKE TO UNDERSTAND MORE. OBVIOUSLY IT'S A 

NUANCED POSITION, BUT HERE'S HOW I PARSE IT." 

AND THEN YOU SEE THERE'S SEVERAL POINTS BELOW THAT? 

A. YEAH, I SEE THAT. 

Q. SO THEN YOU WROTE IN POINT NUMBER 1, "WHEN IT COMES TO 

ESSENTIAL IPR AS RELATES TO DECLARED IPR FOR STANDARDS (E.G., 

UMTS, HSPA, LTE, GSM, H.265, ET CETERA), WE ARE NOT IN A 

POSITION TO OFFER ANY INDEMNIFICATION/COVERAGE SINCE WE ARE NOT 

THE SPECIAL PATENT HOLDERS -- HOWEVER THE KEY POINT IS THAT 

RESPONSIBILITY FOR THE NECESSARY LICENSES FOR THESE SPECIAL 

PATENTS RESTS WITH THE OEM/ODM/BRAND AND SHOULD BE INDEPENDENT 

OF WHATEVER CHIPSET IS INCLUDED." 

THAT WAS AN ACCURATE STATEMENT OF YOUR UNDERSTANDING AT 

THE TIME; CORRECT? 

A. YEAH. I THINK I WAS TRYING TO REFLECT MY UNDERSTANDING OF 

HOW THE CELLULAR INDUSTRY WORKED IN THIS REGARD. 

Q. AND THEN IN PARAGRAPH NUMBER 4, TOWARDS THE BOTTOM OF 

PAGE, YOU WROTE, "OUR POSITION SHOULD BE THAT ZTE SHOULD HAVE 

THE NECESSARY LICENSES TO PATENTS (ESSENTIAL AND NON-ESSENTIAL) 

IN PLACE ALREADY TO ENABLE THEM TO SELL MOBILE DEVICES TO 

T-MOBILE IN THE U.S." 

THAT ACCURATELY CAPTURES WHAT YOU THOUGHT YOUR POSITION 

SHOULD BE AT THAT TIME; CORRECT? 

A. YEAH. I THINK I WAS TRYING TO HELP MY TEAMMATE NAVIGATE 

THIS QUESTION ON THE IPR ISSUE FROM THE OPERATOR AT THE TIME, 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 200 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

360

YES. 

Q. AND THEN ON THE PAGE IN SUBPARAGRAPH A, YOU WROTE, "MY 

ASSUMPTION HERE IS THAT ZTE WOULD PAY A ROYALTY TO QUALCOMM FOR 

EVERY 3G OR LTE DEVICE SHIPPED -- INDEPENDENT OF WHETHER IT IS 

A MEDIATEK OR QUALCOMM CHIP -- THAT IS FOR THE USE OF ANY/ALL 

QUALCOMM I.P." 

DO YOU SEE THAT?

A. YES, I SEE THAT. 

Q. THAT ACCURATELY STATES WHAT YOUR ASSUMPTION WAS IN 2014; 

CORRECT? 

A. YEAH, I THINK THAT'S FAIR.

Q. AND THAT REMAINED YOUR ASSUMPTION AS OF YOUR DEPOSITION; 

RIGHT? 

A. YEAH, I THINK SO.

Q. AND IT WAS ALSO YOUR UNDERSTANDING THAT THE SAME PRINCIPLE 

SHOULD HOLD TRUE FOR ANY OTHER NECESSARY I.P. HOLDERS BESIDES 

QUALCOMM; RIGHT? 

A. YEAH, I THINK THAT WAS THE ASSUMPTION, YES. 

Q. MR. MOYNIHAN, PLEASE TURN TO THE LAST E-MAIL IN TIME IN 

THIS CHAIN. THAT'S THE ONE DATED MAY 8, 2014, AT 9:13 P.M. 

A. YEP, I SEE IT. 

Q. IF YOU LOOK AT THE PARAGRAPH NUMBER 2, YOU WROTE THERE, "A 

FEW YEARS AGO THERE WAS SOME LAWSUITS, I RECALL THE KEY CASE 

WAS INVOLVING LG, INTEL AND QUANTUM, THAT ESTABLISHED THE 

CONCEPT OF PATENT EXHAUSTION, I.E., IF THE IPR IS LICENSED AT 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 201 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

361

THE CHIPSET AND IT BECAME EXHAUSTED, THEN THE IPR HOLDER CAN NO 

LONGER CLAIM ROYALTIES FROM ANYONE ELSE IN THE CHAIN." 

DO YOU SEE THAT?

A. YES, I DO. 

Q. AND THEN YOU WROTE, "I BELIEVE THESE RULINGS CAUSED MANY 

OF THE IPR HOLDERS TO REWORK THEIR LICENSE AGREEMENTS AND 

POLICIES AND IN MY EXPERIENCE THEY NOW GO OUT OF THEIR WAY TO 

MAKE IT ABSOLUTELY CLEAR THAT THEY ARE NOT LICENSING TO THE 

CHIPSET COMPANY." 

THAT STATEMENT ACCURATELY REFLECTS YOUR UNDERSTANDING OF 

THE INDUSTRY IN 2014; CORRECT? 

A. CORRECT. 

Q. AND THEN YOU WROTE, "FOR EXAMPLE I WORKED ON THE MPA 

AGREEMENT WITH NOKIA AND THERE IS LANGUAGE IN THERE WRITTEN 

OVER AND OVER THAT NOTHING IN THE AGREEMENTS GIVES MEDIATEK ANY 

RIGHTS TO THE NOKIA IPR." 

AND THEN YOU ADDED, "BUT IT IS EXTREMELY IMPORTANT FOR 

THEM THAT THEIR IPR IS NOT SEEN TO BE LICENSED TO THE CHIPSET 

COMPANIES." 

THAT ACCURATELY REFLECTS THE POSITION THAT NOKIA TOOK IN 

THEIR NEGOTIATIONS WITH YOU; CORRECT? 

A. YEAH. I'M BEING DRAMATIC, YES.

Q. FURTHER DOWN ON THE PAGE IN THE FIRST BULLET POINT, YOU 

WROTE, "ALL ESSENTIAL IPR IS TYPICALLY LICENSED BY IPR HOLDERS 

TO THE END DEVICE MANUFACTURER." 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 202 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

362

THAT STATEMENT ACCURATELY REFLECTS YOUR UNDERSTANDING OF 

THE INDUSTRY IN 2014 AS WELL; CORRECT? 

A. YEAH, FOR CELLULAR STUFF, CELLULAR INDUSTRY, YES, THAT'S 

MY UNDERSTANDING.

Q. AND THE LAST BULLET POINT ON THAT PAGE, YOU WROTE, "THERE 

ARE OTHER LEGAL STRUCTURES THAT CAN BE USED BETWEEN 

SEMICONDUCTOR COMPANIES, E.G. COVENANT NOT TO SUE -- BASICALLY 

AN AGREEMENT THAT MEANS THE COMPANIES AGREE NOT TO SUE EACH 

OTHER ON PATENTS." 

DO YOU SEE THAT LANGUAGE? 

A. YES, I DO.

Q. AND IT'S YOUR UNDERSTANDING THAT THAT IS THE TYPE OF 

AGREEMENT THAT WAS IN PLACE IN 2009 AND FOR SOME YEARS 

THEREAFTER BETWEEN QUALCOMM AND MEDIATEK; CORRECT? 

A. CORRECT. 

Q. MR. MOYNIHAN, MEDIATEK HAS MADE INCENTIVE PAYMENTS TO 

OEM'S FROM TIME TO TIME; RIGHT? 

A. YES.

Q. THOSE INCENTIVE PAYMENTS ARE SOMETIMES CALLED MARKET 

DEVELOPMENT FUNDS, OR MDF'S? 

A. CORRECT. 

Q. FOR EXAMPLE, IN 2016, MEDIATEK ENTERED INTO AN MDF 

ARRANGEMENT WITH SONY; RIGHT? 

A. PERHAPS. I DON'T KNOW. I DON'T REMEMBER THE EXACT 

TIMEFRAME. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 203 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

363

Q. AND THAT ARRANGEMENT WAS FOR OVER A MILLION DOLLARS; 

CORRECT? 

A. COULD BE, YEAH. 

Q. IN 2016, MEDIATEK ALSO OFFERED AN MDF TO MOTOROLA; 

CORRECT? 

A. WOULDN'T SURPRISE ME, BUT YES.

Q. A MEMBER OF YOUR TEAM PROPOSED THAT THIS OFFER TO MOTOROLA 

BE FOR $10 MILLION; CORRECT? 

A. CAN YOU REMIND ME OF THE TIMEFRAME?

Q. AROUND 2016. 

A. YEAH, ABOUT -- 

Q. EXCUSE ME. 2015. 

A. 2015. YEAH, COULD BE. 

MR. SHACHAM: YOUR HONOR, I BELIEVE THE REMAINDER OF 

MY QUESTIONS WOULD BE ONES THAT ARE SAFER PUT INTO THE CLOSED 

PORTION. 

THE COURT: OKAY. IT'S 3:32. 

MR. KEHL: YOUR HONOR, I HAVE A FEW MINUTES OF PUBLIC 

REDIRECT IF IT WOULD BE MORE EFFICIENT. 

THE COURT: OH, THAT'S FINE. 

GO AHEAD. LET ME KNOW WHEN YOU'RE READY. 

(PAUSE IN PROCEEDINGS.) 

MR. KEHL: I'M READY, YOUR HONOR. 

THE COURT: OKAY. GO AHEAD. 3:33. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 204 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

364

REDIRECT EXAMINATION

BY MR. KEHL:

Q. MR. MOYNIHAN, COUNSEL FOR QUALCOMM WAS ASKING YOU ABOUT 

GAPS. 

DO YOU RECALL THAT? 

A. GAPS IN?

Q. GAPS -- TECHNOLOGICAL GAPS BETWEEN MEDIATEK AND QUALCOMM? 

A. SURE, YEAH. 

Q. WHERE IN TERMS OF TECHNOLOGY HAS MEDIATEK CLOSED THE GAP 

IN TECHNOLOGY WITH QUALCOMM? 

A. I THINK IN CERTAIN ASPECTS OF THE SMARTPHONE PRODUCTS WE 

HAVE. WE HAD A FAIRLY INTENSIVE PROGRAM AT ONE POINT IN TIME 

TO TRY TO CLOSE THE GAPS. 

I THINK IN TERMS OF CAMERA ISP, WI-FI TECHNOLOGY, POWER 

CONSUMPTION, RF, CPU, SOME OTHER DIMENSIONS I THINK WE'VE 

CLOSED IT SIGNIFICANTLY. 

Q. AND WHERE HAS MEDIATEK NOT CLOSED THE GAP WITH QUALCOMM? 

A. PREDOMINANTLY I WOULD SAY ON THE MODEM TECHNOLOGY.

Q. WHERE IN TERMS OF MARKET SEGMENTS HAS MEDIATEK CLOSED THE 

GAP WITH QUALCOMM? 

A. YOU KNOW, I THINK IN, IN -- CERTAINLY IN THE ENTRY PARTS 

OF THE 4G MARKET, I THINK WE'RE QUITE COMPETITIVE NOW. 

YOU KNOW, THAT ALSO APPLIES MAYBE TO SOME GEOGRAPHY, 

EMERGING MARKETS, CHINA, WHERE WE PROBABLY ARE MORE COMPETITIVE 

IN THE MODEM FEATURES TODAY.

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 205 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

365

Q. AND WHERE HAS MEDIATEK NOT CLOSED THE GAP IN TERMS OF 

MARKET SEGMENTS? 

A. HIGHER TIER, PREMIUM TIER. WE TALKED ABOUT IT EARLIER, 

THE HIGHER TIERS OF THE SMARTPHONE MARKET.

Q. AND IS THERE A GEOGRAPHICAL COMPONENT TO THE REMAINING GAP 

AS WELL? 

A. YEAH, THOSE FEATURES TEND TO BE IMPORTANT IN MARKETS LIKE 

THE U.S., SOME OTHERS, JAPAN, KOREA, MAYBE AT THE HIGH END OF 

THE EUROPEAN MARKET AS WELL.

Q. TO WHAT DO YOU ATTRIBUTE THESE REMAINING GAPS? 

A. PROBABLY A LOT OF FACTORS, BUT, YOU KNOW, CERTAINLY WE 

HAVEN'T BEEN ABLE TO INVEST ENOUGH I THINK IN THE MODEM 

TECHNOLOGY AND DEPLOY IT FAST ENOUGH TO MARKET. 

Q. COUNSEL FOR QUALCOMM ALSO REFERRED YOU TO SOME TESTIMONY 

FROM YOUR INVESTIGATIONAL HEARING IN WHICH YOU REFERRED TO 

TRYING TO STABILIZE THE MODEM. 

DO YOU RECALL THAT? 

A. YES, I BELIEVE SO. 

Q. WHAT DOES IT MEAN TO STABILIZE A MODEM? 

A. FOR ME WHAT IT MEANS IS, YOU KNOW, IF YOU'RE LAUNCHING A 

NEW MODEM GENERATION INTO THE MARKET, IT TAKES CERTAINLY SOME 

TIME TO GET IT INTO PRODUCTION, LAUNCH IT WITH MULTIPLE OEM'S 

INTO MULTIPLE OPERATOR NETWORKS AND OPERATORS, NETWORK 

OPERATORS, AND IRON OUT ANY OF THE ISSUES, THE BUGS THAT IT 

MIGHT FIND IN THE FIELD. SO THAT TAKES SOME TIME. 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 206 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

366

SO I CALL THAT SORT OF IRONING OUT OR HARDENING OF THE 

MODEM. 

Q. AND COUNSEL FOR QUALCOMM ALSO ASKED YOU ABOUT CERTAIN MDF 

AGREEMENTS THAT MEDIATEK HAS; IS THAT CORRECT?

A. CORRECT.

Q. DOES MEDIATEK REQUIRE A LICENSE FOR AN MDF AGREEMENT? 

A. WE PROBABLY PUT SOME KIND OF MARKETING AGREEMENT IN PLACE. 

I'M NOT SURE IT WOULD BE A LICENSE TECHNICALLY, BUT THERE MIGHT 

BE SOME KIND OF AGREEMENT, YES.

Q. DOES THAT LICENSE IMPLICATE STANDARD ESSENTIAL PATENTS OR 

ANY OTHER PATENT RIGHTS? 

A. NO. IT MOSTLY TALKS ABOUT, LIKE, MARKETING ACTIVITIES 

THAT THE BRAND IS GOING TO DO. 

MR. KEHL: ALL RIGHT. NOTHING FURTHER ON PUBLIC 

REDIRECT, YOUR HONOR. 

THE COURT: ALL RIGHT. THE TIME IS 3:36. 

DO YOU WANT ANY PUBLIC RECROSS? 

MR. SHACHAM: NO, YOUR HONOR. 

THE COURT: OKAY. 

ALL RIGHT. AND AFTER MR. MOYNIHAN, THE OTHER TWO 

WITNESSES WILL BE BY DEPOSITION AND THOSE ARE ALSO SEALED; IS 

THAT RIGHT? 

MS. MILICI: THAT'S CORRECT, YOUR HONOR. 

THE COURT: OKAY. SO THEN WHY DON'T WE GO AHEAD AND 

TAKE A, JUST -- SINCE WE TOOK A LONGER BREAK AT 2:18, LET'S 

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 207 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

MOYNIHAN CROSS BY MR. SHACHAM

UNITED STATES COURT REPORTERS

367

JUST TAKE A FIVE MINUTE BREAK THEN AND THEN WE'LL END AT 4:30. 

AND I THINK WE CAN SAY GOOD-BYE TO ALL OF OUR GUESTS 

BECAUSE THE REST OF THE PROCEEDINGS TODAY WILL BE SEALED. 

OKAY. THANK YOU. 

LET'S TAKE A FIVE MINUTE BREAK AND WE'LL EMPTY OUT THE 

COURTROOM. THANK YOU. 

THE WITNESS: DO I STAY HERE? 

THE COURT: NO. YOU CAN STEP DOWN. 

THE WITNESS: THANKS. 

(RECESS FROM 3:37 P.M. UNTIL 3:45 P.M.)

(PROCEEDINGS UNDER SEAL FROM PAGES 368 TO 407.)

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 208 of 209
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

UNITED STATES COURT REPORTERS

CERTIFICATE OF REPORTERS

WE, THE UNDERSIGNED OFFICIAL COURT REPORTERS OF THE 

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF 

CALIFORNIA, 280 SOUTH FIRST STREET, SAN JOSE, CALIFORNIA, DO 

HEREBY CERTIFY: 

THAT THE FOREGOING TRANSCRIPT, CERTIFICATE INCLUSIVE, IS 

A CORRECT TRANSCRIPT FROM THE RECORD OF PROCEEDINGS IN THE 

ABOVE-ENTITLED MATTER. 

______________________________

IRENE RODRIGUEZ, CSR, CRR

CERTIFICATE NUMBER 8076

_______________________________

LEE-ANNE SHORTRIDGE, CSR, CRR 

CERTIFICATE NUMBER 9595

DATED: JANUARY 7, 2019

Case 5:17-cv-00220-LHK Document 1510 Filed 07/02/19 Page 209 of 209