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UNITED STATES COURT REPORTERS

408

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

FEDERAL TRADE COMMISSION, 

PLAINTIFF,

VS.

QUALCOMM INCORPORATED, A 

DELAWARE CORPORATION,

DEFENDANT.

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C-17-00220 LHK

SAN JOSE, CALIFORNIA

JANUARY 8, 2019

VOLUME 3 

PAGES 408-636

SEALED PAGES 414 - 419

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

 MIKA IKEDA 

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

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UNITED STATES COURT REPORTERS

409

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

 ANTONY RYAN 

825 EIGHTH AVENUE 

 NEW YORK, NEW YORK 10019

ALSO PRESENT: MARK SNYDER 

JEFF DAHM

KEN KOTARSKI 

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UNITED STATES COURT REPORTERS

410

INDEX OF WITNESSES

PLAINTIFF'S

JOHN GRUBBS

VIDEOTAPED DEPOSITION (SEALED) P. 415 

SCOTT MCGREGOR

VIDEOTAPED DEPOSITION (SEALED) P. 417 

ANDREW HONG

VIDEOTAPED DEPOSITION P. 421 

WILLIAM WYATT

DIRECT EXAM BY MS. IKEDA P. 427

CROSS-EXAM BY MR. EVEN P. 447

REDIRECT EXAM BY MS. IKEDA P. 467

CRISTIANO AMON

DIRECT EXAM BY MR. MATHESON P. 478 

CROSS-EXAM BY MS. SESSIONS P. 513

REDIRECT EXAM BY MR. MATHESON P. 544 

AICHATOU (AICHA) EVANS

DIRECT EXAM BY MR. CARSON P. 551

CROSS-EXAM BY MR. RYAN P. 590 

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UNITED STATES COURT REPORTERS

411

INDEX OF EXHIBITS

MARKED ADMITTED

PLAINTIFF'S

2628 421

5800 429

7591 431

5551 434

8291 435

5809 439

5767 441

8292 444

8257 480

5393 482

5294 484

5279 485

6839 488

6840 490

8276 492

7606 493

7607 494

7644 503

8256 506

5321 507

5053 511

7024 511

1599 578

1598 583

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UNITED STATES COURT REPORTERS

412

INDEX OF EXHIBITS

MARKED ADMITTED

DEFENDANT'S

9250 546

9312 466

9225 536

76 595

92 601

89 607

94 615

JOINT

0095 417

0122 421

0096 504

0096 504

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UNITED STATES COURT REPORTERS

413

SAN JOSE, CALIFORNIA JANUARY 8, 2019 

P R O C E E D I N G S

(COURT CONVENED AT 9:06 A.M.)

THE COURT: GOOD MORNING, WELCOME BACK. 

MR. VAN NEST: GOOD MORNING, YOUR HONOR. 

THE COURT: PLEASE TAKE A SEAT. 

WE DO NEED TO KEEP THE ROOM SEALED, CORRECT, TO FINISH THE 

TRANSCRIPT? 

MS. MILICI: THAT'S CORRECT. 

THE COURT: ARE THE PARTIES SATISFIED WITH WHO'S IN 

HERE? 

MR. CARSON: I THINK THERE MAY BE GREATER THAN THE -- 

THE COURT: I'M SORRY, IF YOU COULD WAIT IN THE 

ATTORNEY'S LOUNGE, WE'LL LET YOU KNOW AS SOON AS THIS IS DONE. 

THANK YOU. I APOLOGIZE FOR THE INCONVENIENCE.

(PROCEEDINGS UNDER SEAL FROM PAGES 414 TO 419.)

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UNITED STATES COURT REPORTERS

420

(IN OPEN COURT.)

THE COURT: ALL RIGHT. WHO'S YOUR NEXT WITNESS? 

MS. IKEDA: MIKA IKEDA FOR THE FTC. 

NEXT THE FTC WILL PLAY THE VIDEOTAPED DEPOSITION TESTIMONY 

OF ANDREW HONG. HE IS AN ATTORNEY IN THE GLOBAL LEGAL AFFAIRS 

GROUP AT SAMSUNG AND HE'S WORKED AT SAMSUNG SINCE 2003. 

THE COURT: OKAY. 

MS. IKEDA: MAY I APPROACH WITH WITNESS BINDERS? 

THE COURT: YES. 

MS. IKEDA: AND 28 SECONDS OF THE VIDEO IS 

DEFENDANT'S COMPLETENESS DESIGNATION. 

THE COURT: OKAY. THAT'LL COUNT AS A MINUTE. 

WAS THERE ANYTHING THAT NEEDED TO BE ATTRIBUTED TO 

QUALCOMM FOR MR. MCGREGOR'S VIDEO? 

MR. CARSON: I DON'T BELIEVE SO, YOUR HONOR. 

MR. BORNSTEIN: THERE WAS NOT, YOUR HONOR. 

THE COURT: OKAY. ALL RIGHT. 

MS. IKEDA: YOUR HONOR, AT THIS TIME THE FTC MOVES TO 

ADMIT CX 26 -- 

THE COURT: OKAY, WAIT A SECOND. I'VE GOT TO CHARGE 

YOU TIME. 

OKAY. 9:47. GO AHEAD. WHAT EXHIBIT DO YOU WANT TO 

ADMIT? 

MS. IKEDA: WE MOVE TO ADMIT CX 2628 AND JX 0122. 

THE COURT: YOU SAID TX OR CX? 

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HONG VIDEO

UNITED STATES COURT REPORTERS

421

MS. IKEDA: CX.

THE COURT: OKAY. CX 2628 AND JX 0122. 

ANY OBJECTION? 

MR. VAN NEST: GIVE ME A MOMENT, YOUR HONOR. 

(PAUSE IN PROCEEDINGS.) 

THE COURT: I ASSUME YOU DON'T OBJECT TO A JOINT 

EXHIBIT. 

MR. VAN NEST: NOT THE JX.

THE COURT: THAT WOULD BE UNREASONABLE. 

MR. VAN NEST: NOT ON THE JX. 

NO OBJECTION, YOUR HONOR. 

THE COURT: IT'S ADMITTED. 

GO AHEAD, PLEASE. 

MS. IKEDA: THANK YOU.

(PLAINTIFF'S EXHIBIT CX 2628 AND JOINT EXHIBIT JX 0122 

WERE ADMITTED INTO EVIDENCE.) 

(THE VIDEOTAPED DEPOSITION OF ANDREW HONG WAS PLAYED IN 

OPEN COURT OFF THE RECORD.)

MR. EVEN: YOUR HONOR, WE BELIEVE THAT THIS EXHIBIT 

IS SUPPOSED TO BE SEALED. 

THE COURT: IT'S 10:01. 

MS. IKEDA: YOUR HONOR, MAY I BE HEARD? 

THE SEALING ORDERS THAT THE COURT ISSUED DID NOT APPLY TO 

THIS -- THESE PORTIONS OF THE DOCUMENT. 

THE COURT: ARE WE ON JX 122? 

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HONG VIDEO

UNITED STATES COURT REPORTERS

422

MS. IKEDA: YES. 

THE COURT: OKAY. THIS IS A SETTLEMENT AGREEMENT. 

IT IS NOT -- I DIDN'T SEAL THE WHOLE THING. I UNSEALED A LOT 

OF IT. SO I DON'T KNOW, WHAT'S YOUR OBJECTION? I REMEMBER 

WHAT I SEALED ON THIS DOCUMENT. SO -- THEY'RE NOT GOING TO 

HIDE THE WHOLE SETTLEMENT BETWEEN SAMSUNG AND QUALCOMM. 

MR. EVEN: I FULLY UNDERSTAND AND APPRECIATE THAT, 

YOUR HONOR. 

THE COURT: THAT'S NOT HAPPENING. 

MR. EVEN: THIS IS -- IF THE FTC IS MAINTAINING THAT 

IT'S ONLY SHOWING ON THE SCREEN THE PORTIONS THAT HAVE NOT BEEN 

SEALED, THEN WE HAVE NO OBJECTION. 

I JUST WANTED TO MAKE SURE THAT WE'RE NOT SHOWING 

SOMETHING THAT HAS BEEN SEALED. 

MS. IKEDA: THAT'S CORRECT. 

THE COURT: YES. AND I MAY UNSEAL MORE. AS I'M 

WATCHING, I MAY UNSEAL MORE. 

BUT I'M SURE THAT THEY WILL FOLLOW TO BE CONSISTENT WITH 

THE ORDER. 

MR. EVEN: THANK YOU, YOUR HONOR. 

THE COURT: OKAY. 10:02. 

(THE VIDEOTAPED DEPOSITION OF ANDREW HONG WAS PLAYED IN 

OPEN COURT OFF THE RECORD.)

THE COURT: 10:08. 

IS THIS WITNESS SUBJECT TO RECALL, OR NOT? 

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UNITED STATES COURT REPORTERS

423

MS. IKEDA: YES, YOUR HONOR. 

THE COURT: AND WHAT ABOUT MCGREGOR? SUBJECT TO 

RECALL, OR NOT? 

MR. ANSALDO: YES, YOUR HONOR. 

MR. VAN NEST: AND BOTH, YOUR HONOR, ARE SUBJECT TO 

COUNTERS FROM QUALCOMM. 

THE COURT: YOU DON'T NEED TO KEEP SAYING THAT. I 

UNDERSTAND. 

MR. VAN NEST: OKAY. THANK YOU. 

THE COURT: 10:008. 

OKAY. WHO'S YOUR NEXT WITNESS? 

MS. IKEDA: YOUR HONOR, THE FTC CALLS WILL WYATT AS 

ITS NEXT WITNESS. 

THE COURT: OKAY. 

MS. IKEDA: MAY WE APPROACH WITH SOME DEPOSITION AND 

EXHIBIT BINDERS? 

THE COURT: YES. 

(PAUSE IN PROCEEDINGS.) 

MS. IKEDA: YOUR HONOR, I UNDERSTAND FROM AN E-MAIL 

RECEIVED LAST NIGHT THAT QUALCOMM MIGHT SEEK TO SEAL CONCERN 

DOCUMENTS IN THIS EXAMINATION. 

THE COURT: IT'LL BE ON THEIR TIME. IT'LL BE ON 

THEIR TRIAL TIME. 

MS. IKEDA: SHOULD WE ADDRESS THOSE AS THEY ARISE? 

THE COURT: I'M SORRY? 

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UNITED STATES COURT REPORTERS

424

MS. IKEDA: SHOULD WE ADDRESS THOSE AS THEY ARISE? 

THE COURT: OR I GUESS WE COULD DO IT RIGHT NOW WHILE 

THEIR WITNESS IS SITTING HERE. 

GO AHEAD. IT'S 10:10. WHAT DO YOU WANT TO SEAL? 

MR. EVEN: YOUR HONOR, I DON'T KNOW WHICH DOCUMENTS 

FTC COUNSEL INTENDS TO USE. MAYBE IT'S EASIER AS WE GO. 

MS. IKEDA: I LISTED -- I CAN ADDRESS THE ONES THAT 

WERE ON YOUR LIST THAT I'M GOING TO USE TODAY. 

CX 7591. 

THE COURT: OKAY. WHAT PAGES OF THAT DOCUMENT DO YOU 

WANT SEALED? 

MR. EVEN: CX 7591-010. 

THE COURT: OKAY. THAT'S GRANTED. 

MR. EVEN: 012. 

THE COURT: OKAY. LET ME MAKE A NOTE. 

7591, PAGES 010, 012, THAT'S GRANTED. 

MR. EVEN: 012 THROUGH 015, THAT'S ALL PRICING 

INFORMATION. 

THE COURT: THAT'S GRANTED. 

MR. EVEN: AND 018 THROUGH 021. 

THE COURT: THAT'S GRANTED. 

MR. EVEN: 025. 

THE COURT: THAT'S GRANTED. 

MR. EVEN: 032 AND 33. 

THE COURT: THIS IS AN OBSOLETE -- WE'RE TALKING 

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UNITED STATES COURT REPORTERS

425

ABOUT 2014 AND 2015. 

MR. EVEN: IT IS, YOUR HONOR. IT DOES TALK ABOUT 

THAT. IT HAS PRICING AND COST. MY UNDERSTANDING IS THAT 

PRICE, WHEN PRICING MOVES, COST DOESN'T MOVE THAT MUCH, AND 

THAT'S AN ISSUE FOR OUR CLIENT. 

THE COURT: I DON'T SEE COST ON PAGE 032. 

MR. EVEN: NO. THE COST IS IN 33 I BELIEVE. 

THE COURT: RIGHT. SO WHY ARE WE SEALING 032? I'M 

SURE THESE PRODUCTS ARE END OF LIFE IF THEY'RE FOUR YEARS OLD, 

FIVE YEARS OLD. 

MR. EVEN: OKAY, YOUR HONOR. I THINK SAMSUNG MAY 

FEEL DIFFERENTLY ABOUT THAT, BUT FROM OUR PERSPECTIVE 033 WILL 

SUFFICE. 

THE COURT: OKAY. 

MR. EVEN: AND 037, IT'S THE SAME KIND OF PRICING 

LIST. 

THE COURT: THAT'S FINE. 037 IS GRANTED. 

OKAY. ANY OTHERS? 

MS. IKEDA: CX 5551. 

MR. EVEN: SO THAT'S AT 045 AND 046. 

THE COURT: 45 IS GRANTED. 46 IS GRANTED. THAT'S 

FINE. 

ARE YOU PLANNING TO USE ANYTHING ELSE? 

MS. IKEDA: YES. 

MR. EVEN: ANYTHING ELSE HERE THAT'S ON THE LIST? 

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UNITED STATES COURT REPORTERS

426

CX 8254. 

THE COURT: OKAY. WHICH PAGES, PLEASE? 

MR. EVEN: 025. 

THE COURT: GRANTED. 

MR. EVEN: 029 AND 30. 

THE COURT: 29 IS GRANTED. 30 IS GRANTED. 

MR. EVEN: AND 33. 

THE COURT: THAT'S GRANTED. 

MR. EVEN: I BELIEVE THAT'S IT, YOUR HONOR. 

THE COURT: ALL RIGHT. THANK YOU. 

MR. EVEN: THANK YOU. 

THE COURT: THANK YOU VERY MUCH. 

OKAY. TIME IS 10:15. 

HAVE WE SWORN IN THE WITNESS? 

THE CLERK: NO. 

THE COURT: I'M SORRY, I DON'T THINK WE'VE DONE THAT. 

OKAY. 

THE CLERK: PLEASE STAND. 

PLEASE RAISE YOUR RIGHT HAND. 

(PLAINTIFF'S WITNESS, WILLIAM WYATT, WAS SWORN.)

THE WITNESS: I DO. 

THE CLERK: THANK YOU. YOU CAN BE SEATED. 

PLEASE STATE YOUR FULL NAME AND SPELL YOUR LAST NAME FOR 

THE RECORD. 

THE WITNESS: WILLIAM BERNARD WYATT. MY LAST NAME IS 

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WYATT DIRECT BY MS. IKEDA

UNITED STATES COURT REPORTERS

427

SPELLED W-Y-A-T-T. 

THE COURT: ALL RIGHT. TIME IS 10:15. GO AHEAD, 

PLEASE. 

DIRECT EXAMINATION

BY MR. IKEDA: 

Q. GOOD MORNING, SIR. 

A. GOOD MORNING.

Q. YOU ARE CURRENTLY VICE PRESIDENT OF FINANCE AT QUALCOMM? 

A. THAT'S CORRECT.

Q. AND YOU STARTED WORKING AT QUALCOMM IN 2005? 

A. DID I.

Q. YOUR FIRST POSITION WAS DIRECTOR OF OPERATION EXPENSES; 

CORRECT? 

A. IT WAS.

Q. AND AFTER THAT YOU BECAME THE COMMERCIAL AND PRICING LEAD 

WITHIN THE FINANCE TEAM?

A. THAT'S CORRECT.

Q. AND AS COMMERCIAL LEAD, YOU WERE RESPONSIBLE FOR SETTING 

QUALCOMM'S PRICING PRACTICE AND MANAGING THE INCENTIVES AROUND 

QUALCOMM'S PRICING; CORRECT?

A. YES.

Q. YOU ALSO WORKED ON FINANCIAL OUTLOOKS AND STRATEGIC PLANS? 

A. I DID.

Q. AND NOW YOU'RE THE FINANCIAL LEAD FOR QUALCOMM'S MOBILE 

CHIP DIVISION; CORRECT? 

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WYATT DIRECT BY MS. IKEDA

UNITED STATES COURT REPORTERS

428

A. THAT'S CORRECT.

Q. YOU'VE LOOKED AT THE VARIOUS DRIVERS THAT AFFECT 

QUALCOMM'S PRICING DECISIONS; CORRECT? 

A. YES.

Q. AND YOU WOULD AGREE THAT QUALCOMM'S POSITION RELATIVE TO 

ITS COMPETITORS IS FAR AND AWAY THE LARGEST DRIVER OF ITS 

PRICING DECISIONS, WOULDN'T YOU? 

A. I WOULD NOT. 

Q. WOULD YOU TURN YOUR ATTENTION TO YOUR DEPOSITION PAGE 37, 

IT'S THE FIRST TAB IN YOUR DEPOSITION BINDER, LINES 20 TO PAGE 

38:1? 

A. I'M SORRY, PAGE 37? 

Q. PAGE 37, LINE 20 TO 38:1. 

IT'S A TRUE STATEMENT, SIR, THAT YOU SAID OUR COMPETITIVE 

POSITION RELATIVE TO OUR COMPETITORS IS -- IS FAR AND AWAY THE 

LARGEST DRIVER IN TERMS OF OUR PRICING DECISIONS; CORRECT? 

A. SO WHAT I READ IS IT SAYS THERE'S ONE OF THESE ON THIS 

PAGE, SO I NEED TO MAYBE TAKE A LOOK AT WHAT THIS PAGE WAS 

REFERRING TO. 

Q. IS IT A CORRECT STATEMENT THAT YOU STATED AT YOUR 

DEPOSITION, UNDER OATH, THAT YOUR COMPETITIVE POSITION RELATIVE 

TO YOUR COMPETITORS IS FAR AND AWAY THE LARGEST DRIVER IN TERMS 

OF YOUR PRICING DECISIONS? 

A. SO THAT'S A CORRECT STATEMENT THAT I SAID THAT.

Q. THANK YOU. 

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WYATT DIRECT BY MS. IKEDA

UNITED STATES COURT REPORTERS

429

QUALCOMM SELLS MODEM CHIPS WITH CDMA CAPABILITY; CORRECT?

A. WE DO.

Q. AND QUALCOMM CHIPS THAT HAVE CDMA HAVE HAD HIGHER 

PROFITABILITY AND HIGHER PRICE POINTS VERSUS PRODUCTS THAT 

DON'T HAVE CDMA; CORRECT?

A. WE HAVE. 

Q. I'D LIKE YOU TO TURN TO TAB 1 IN YOUR BINDER, THAT'S 

QX 5800. 

DO YOU IDENTIFY THIS, SIR, AS AN E-MAIL SENT BY YOU TO 

SANJAY MEHTA IN AUGUST OF 2015? 

A. YES. 

MS. IKEDA: MOVE TO ADMIT CX 5800. 

THE COURT: ANY OBJECTION? 

MR. EVEN: NO OBJECTION, YOUR HONOR. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 5800 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE.

BY MS. IKEDA: 

Q. IN YOUR E-MAIL TO SANJAY MEHTA, YOU HIGHLIGHT AN EARLIER 

E-MAIL FROM CRISTIANO AMON; CORRECT? 

A. YES.

Q. AND HE WAS PRESIDENT AT THE TIME OF THIS E-MAIL? 

A. HE WAS.

Q. AND YOUR EXCERPT FROM MR. AMON'S E-MAIL SAYS, "USUALLY 

PREMIUM ERODES WHEN ALTERNATIVE SOLUTION DEFINES NEW ASP." 

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WYATT DIRECT BY MS. IKEDA

UNITED STATES COURT REPORTERS

430

CORRECT? 

A. YES, IT SAYS THAT.

Q. AND THEN YOU HIGHLIGHTED, "CONTINUES TO BE TRUE FOR CDMA 

PREMIUM OUTSIDE CHINA, WHERE CDMA PREMIUM IN CHINA IS 

DISAPPEARING DUE TO THE MTK INTEGRATED SOLUTION."

DO YOU SEE THAT?

A. I DO.

Q. AND MTK HERE REFERS TO MEDIATEK; RIGHT? 

A. IT DOES.

Q. AND, IN FACT, QUALCOMM WITNESSED LOWER CDMA CHIPSET PRICES 

FOLLOWING MEDIATEK'S INTRODUCTION OF -- FOLLOWING MEDIATEK 

INTRODUCTION OF AN INTEGRATED CDMA LTE CHIP? 

A. SORRY. CAN YOU REPEAT THE QUESTION?

Q. QUALCOMM WITNESSED LOWER CDMA CHIPSET PRICES AFTER 

MEDIATEK'S INTRODUCTION OF AN INTEGRATED CDMA LTE CHIP? 

A. WE DID.

Q. YOU'VE BEEN INVOLVED IN DEFINING QUALCOMM'S PRICE POINTS 

WORKING WITH QCT'S SALES TEAM?

A. I HAVE. 

Q. COULD YOU TURN TO TAB 2 OF YOUR BINDER. SIR, THIS IS AN 

E-MAIL FROM MARK DRAGICEVICH TO YOU FROM DECEMBER 2014; 

CORRECT?

A. IT IS. 

Q. AND MR. DRAGICEVICH WAS A QUALCOMM EMPLOYEE AT THE TIME?

A. HE WAS. 

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WYATT DIRECT BY MS. IKEDA

UNITED STATES COURT REPORTERS

431

MS. IKEDA: MOVE TO ADMIT CX 7591. 

MR. EVEN: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 7591 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE.

BY MS. IKEDA: 

Q. MR. DRAGICEVICH ATTACHES A SLIDE TO HIS E-MAIL. 

DO YOU SEE THAT? 

A. YES.

Q. AND IN THE LAST LINE OF HIS E-MAIL HE SAYS "THE ATTACHED 

CONTAINS THIS SLIDE AND THE PRIOR SLIDES PRESENTED TO CA/MR." 

DO YOU SEE THAT? 

A. I DO.

Q. AND C.A. IS CRISTIANO AMON? 

A. THAT'S CORRECT. 

Q. AND M.R. IS MURTHY RENDUCHINTALA? 

A. YES, THAT'S CORRECT. 

Q. AND THE ATTACHED SLIDE DECK WAS SOME SORT OF STRATEGY 

DOCUMENT? 

A. THE SUBJECT OF THE TITLE, OF THE E-MAIL IS 8939 8916 AND 

8909 BUDGET IMPACT ANALYSIS. SO I THINK WE WERE TAKING A LOOK 

AT THE IMPACT OF COMPETITION AND THE PRICE MOVE RELATIVE TO THE 

BUDGET AT THIS POINT IN TIME.

Q. DIRECT YOUR ATTENTION TO PAGE 11 OF CX 7591. 

THIS IS A SLIDE TITLED BUT THE GET PRICING VERSUS PROPOSED 

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WYATT DIRECT BY MS. IKEDA

UNITED STATES COURT REPORTERS

432

PRICING MOVES, WITH A LINE GRAPH. 

DO YOU SEE THAT? 

A. I DO. 

Q. AND IN THE TOP RIGHT-HAND CORNER OF THE SLIDE THERE'S A 

LEGEND INDICATING THAT THE SOLID DARK GREEN LINE REFERS TO 

QUALCOMM'S BUDGET PRICING. 

DO YOU SEE THAT? 

A. I DO.

Q. AND THE DOTTED YELLOW LINE INDICATES QUALCOMM'S PROPOSED 

PRICING; CORRECT? 

A. YES.

Q. AND THE SOLID GREEN LINE, IF YOU ZOOM OUT, AT THE TOP, IT 

SHOWS THAT THE BUDGET PRICING FOR QUALCOMM'S 8939 CHIP WAS 

19.95 IN THE FOURTH QUARTER OF 2014; CORRECT? 

A. YES, IN THE PHYSICAL QUARTER.

Q. AND IN THE FIRST QUARTER OF 2015, THE BUDGET PRICING FOR 

QUALCOMM'S 1839 CHIP WAS 17.21? 

A. THAT'S THE BUDGET PRICE, YES.

Q. AND TOWARD THE END OF THE FOURTH QUARTER, IN 2014, THERE'S 

A RED BOX LABELED MTK 6752, AND THAT REFERS TO THE INTRODUCTION 

OF MEDIATEK'S 6752 CHIPSET; CORRECT? 

A. THAT'S CORRECT. 

Q. AND FROM THAT BOX, THERE IS A YELLOW DOTTED LINE SHOWING 

THAT THE PROPOSED PRICING FOR QUALCOMM'S 8939 CHIP WAS $15 IN 

THE FIRST QUARTER OF 2015; CORRECT? 

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A. YES. 

Q. SO THIS SHOWS THAT QUALCOMM WAS PROPOSING TO REDUCE THE 

PRICE OF ITS MSN 8939 CHIP BY $2.21 FOLLOWING MEDIATEK'S 

INTRODUCTION OF THE 6752 CHIP? 

A. THAT'S CORRECT.

Q. ARE YOU FAMILIAR WITH SOMEONE BY THE NAME OF THE 

PETE ROSEN AT QUALCOMM?

A. YES.

Q. AND HE REPORTED TO YOU IN YOUR ROLE AS COMMERCIAL AND 

PRICING LEAD; RIGHT? 

A. HE DID.

Q. MR. ROSEN SUPPORTED QUALCOMM'S PREMIUM TIER CHIPSET 

BUSINESS; CORRECT? 

A. I BELIEVE THAT WAS ONE OF THE ASPECTS THAT HE SUPPORTED, 

WHICH IS OUR SNAPDRAGON 800 SERIES. 

Q. THE SNAPDRAGON 800 IS AN EXAMPLE OF WHAT YOU'D CALL A 

PREMIUM TIER CHIPSET? 

A. IN TERMS OF QUALCOMM'S CHIPSETS, IT IS.

Q. AND GENERALLY SPEAKING, PREMIUM TIER CHIPSETS CAN BE 

DEFINED AS THOSE CHIPS THAT WOULD BE USED IN PREMIUM TIER 

PHONES SOLD AT THE TIME; CORRECT? 

A. THAT DEPENDS ON THE SPECIFIC CUSTOMER SITUATION. 

Q. BUT IN GENERAL, PREMIUM TIER CHIPSETS ARE DEFINED AS THOSE 

THAT WOULD BE USED IN PREMIUM TIER PHONES SOLD AT THE TIME; 

CORRECT?

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A. THAT CAN BE THE CASE. 

Q. AND THE IDENTITIES OF PARTICULAR CHIPS THAT QUALIFY AS 

PREMIUM TIER CHIPSETS TYPICALLY CHANGE EVERY YEAR; CORRECT? 

A. YES. 

Q. PREMIUM TIER CHIPSETS TYPICALLY HAVE A HIGHER PRODUCT COST 

AND MORE FUNCTIONALITY; CORRECT?

A. THAT'S CORRECT. 

Q. CAN YOU TURN TO TAB 3 IN YOUR BINDER. 

THIS IS AN E-MAIL SENT BY TAYLOR CABANISS TO YOU ENCLOSING 

A 2016 STRATEGIC PLAN FINANCIAL FORECAST SLIDE DECK IN APRIL 

2014; CORRECT. 

A. YES. 

MS. IKEDA: MOVIE TO ADMIT CX 5551. 

THE COURT: ANY OBJECTION? 

MR. EVEN: NO OBJECTION, YOUR HONOR.

BY MS. IKEDA: 

Q. DIRECTING YOUR ATTENTION TO PAGE 13 OF CX 5551. 

THE REPORTER: IS THAT ADMITTED? 

THE COURT: YES, IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 5551 WAS ADMITTED IN EVIDENCE.)

BY MS. IKEDA: 

Q. THIS IS A SLIDE TITLED PROFIT BY TIER. 

DO YOU SEE THAT? 

A. I DO. 

Q. SO THIS SLIDE IS SHOWING QCT'S FORECASTED REVENUE AND 

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MARGINS BY TIER; CORRECT? 

A. IT IS. 

Q. AND SPECIFICALLY, IT'S SHOWING PROJECTED MARGINS FOR 

FISCAL YEARS 16 AND 17? 

A. THIS WAS ONE VIEW OF WHAT THE REVENUE AND MARGIN WOULD 

LOOK LIKE FROM A BASELINE PERSPECTIVE.

Q. FOR FISCAL YEARS 16 AND 17; CORRECT? 

A. CORRECT. THIS WAS, I DON'T BELIEVE, A FINAL PLAN. BUT 

THERE WAS ONE PRELIMINARY VIEW.

Q. AND IS IT FAIR TO SAY THAT THIS SLIDE SHOWS THAT QCT WAS 

PROJECTING HIGHER MARGINS FOR THE PREMIUM TIER AS COMPARED TO 

ITS MID AND LOW TIER CHIPSETS; CORRECT? 

A. THAT'S CORRECT. 

Q. TURN TO PAGE -- SORRY, TAB 4 IN YOUR BINDER. THIS IS 

QX 8291. 

THIS IS AN E-MAIL FROM YOU TO JACOB MAGDALENO AND 

KATIE ARNER FROM MAY 2016? 

A. YES. 

MS. IKEDA: MOVE TO ADMIT CX 8291. 

THE COURT: ANY OBJECTION? 

MR. EVEN: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 8291 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE.

BY MS. IKEDA: 

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Q. MR. MAGDALENO AND MS. ARNER REPORTED TO YOU IN MAY OF 

2016; CORRECT? 

A. THEY DID. 

Q. AND IN YOUR E-MAIL YOU ATTACH A POWERPOINT PRESENTATION 

ENTITLED QTL LOWER TIER MDF PROGRAM? 

DO YOU SEE THAT? 

A. I DO. 

Q. AND THIS IS A PRESENTATION THAT WAS CREATED BY SOMEONE AT 

QUALCOMM? 

A. YES. 

Q. DIRECT YOUR ATTENTION TO PAGE 4 OF CX 8291. THIS SLIDE IS 

TITLED STRATEGIC CHALLENGES QUALCOMM FACES IN 4G ARE 

INTERRELATED. 

DO YOU SEE THAT?

A. I DO.

Q. AND AT THE TOP RIGHT IT SAYS "SOME CUSTOMERS PERCEIVE QCT 

CHIPS TO BE MORE EXPENSIVE DUE TO LINKAGE AND LICENSING COSTS." 

DO YOU SEE THAT? 

A. I DO. 

Q. QUALCOMM HAS A LICENSE TO CERTAIN PATENTS HELD BY ARM; 

CORRECT?

A. WE DO.

Q. AND QUALCOMM PAYS A ROYALTY TO ARM? 

A. WE DO. 

Q. AND QUALCOMM FACTORS THAT ROYALTY INTO THE COST OF 

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PRODUCING ITS CHIPS; CORRECT?

A. WE DO. 

Q. IS IT FAIR TO SAY THAT QUALCOMM, QCT, CAPTURED LARGER CHIP 

SHARE WITH OEM'S THAT COMPLIED WITH THEIR ROYALTY OBLIGATIONS? 

AS COMPARED TO THOSE WHO DID NOT COMPLY? 

A. I WOULD SAY THAT, THAT FOR OEM'S THAT QCT SOLD CHIPS TO, 

THERE WAS A GREATER VISIBILITY IN TERMS OF WHAT THOSE CHIPS 

WERE THAT WE WERE SELLING, AND, THUS, IT LED TO HIGHER 

COMPLIANCE RATES. 

Q. THAT'S A DIFFERENT QUESTION. 

IS IT FAIR TO SAY THAT QCT CAPTURED LARGER SHARE IN 

GENERAL WITH COMPLIANT OEM'S AS OPPOSED TO NONCOMPLIANT ONES? 

A. I THINK IT'S POSSIBLE. BUT I'D HAVE TO TAKE A LOOK AT -- 

Q. TAKE A LOOK AT YOUR DEPOSITION, PAGE 95, LINES 14 TO 17. 

IT'S A TRUE STATEMENT, SIR, YOU WERE ASKED THIS VERY QUESTION 

IN YOUR DEPOSITION AND YOU SAID, UNDER OATH, YOU SAID "I WOULD 

AGREE WITH THAT STATEMENT"; CORRECT? 

A. YES. 

Q. IN 2016, QCT CREATED SEVERAL NEW INCENTIVE DEALS TO TRY TO 

SOLVE THEIR QTL COMPLIANCE ISSUES; CORRECT? 

A. I WOULD HAVE TO LOOK AT THE SPECIFIC PROPOSAL. 

Q. YOU RECALL THAT QCT CREATED SOME INCENTIVE DEALS TO SOLVE 

THEIR COMPLIANCE ISSUES? 

A. ONCE AGAIN, I'D HAVE TO LOOK AT THAT PROPOSAL. 

THIS PARTICULAR PAGE THAT WE WERE JUST ON IS AN EXAMPLE OF 

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A PROPOSAL THAT WE HAD WORKED ON -- 

Q. I'M NOT TALKING ABOUT A SPECIFIC PROPOSAL. I'M SAYING IN 

GENERAL, IN 2016, QCT CREATED INCENTIVE DEALS TO TRY TO SOLVE 

THEIR COMPLIANCE ISSUES AT QTL? 

A. I DON'T RECALL SPECIFICALLY. I'D HAVE TO LOOK AT THE 

SPECIFIC -- 

Q. TAKE A LOOK AT YOUR DEPOSITION, PAGE 163. LINES 16 TO 18. 

SORRY. LINES 22 TO 24. 

IT'S A TRUE STATEMENT, SIR, THAT YOU SAID QTL WAS TRYING 

TO SOLVE THEIR COMPLIANCE ISSUE AND QTL WAS CREATED NEW 

INCENTIVES OR DISCOUNTS FOR DIFFERENT CUSTOMERS; CORRECT? 

A. YES, I SEE THAT WITH THIS CONTEXT.

Q. AND THESE NEW INCENTIVE DEALS WERE FUNDED BY QTL EVEN 

THOUGH THEY WERE OFFERED BY QTC; CORRECT? QCT, SORRY. 

A. YES. THESE SEALS WERE, WERE CREATED BY QTL. 

Q. AND QTL MANAGES BETWEEN 10 AND 30 INCENTIVE AGREEMENTS 

THAT ARE PARTIALLY OR ENTIRELY FUNDED BY QTL; CORRECT?

A. THIS SPECIFIC SET OF DEALS WERE, YES. 

Q. AND QCT SOMETIMES WITHHELD RELATES WHEN OEM'S DIDN'T 

COMPLY WITH ROYALTY OBLIGATIONS; CORRECT? 

A. ON OCCASION THAT WOULD HAPPEN, YES.

Q. TURN TO TAB 5 IN YOUR BINDER. THIS IS CX 5809. THIS IS 

AN E-MAIL FROM JEREMY BLAIR TO SANJAY MEHTA COPYING YOU AND 

SOME OTHER QUALCOMM EMPLOYEES; CORRECT? 

A. I DON'T SEE THAT IN MY BINDER.

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Q. 5809? 

A. I DON'T SEE THAT. 

Q. I CAN GIVE YOU A COPY. 

MAY I APPROACH? 

THE COURT: YES, GO AHEAD, PLEASE.

BY MS. IKEDA:

Q. THIS IS AN E-MAIL FROM YOU TO -- EXCUSE ME, FROM 

JEREMY BLAIR TO SANJAY MEHTA COPYING YOU? 

A. YES. 

MS. IKEDA: MOVE TO ADMIT CX 5809. 

THE COURT: ANY OBJECTION? 

MR. EVEN: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 5809 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MS. IKEDA:

Q. AND MR. BLAIR ATTACHES A POWERPOINT PRESENTATION ENTITLED 

PRC MEETING NOVEMBER 23RD, 2009. DO YOU SEE THAT? 

A. I DO. 

Q. PRC REFERS TO PRYING REVIEW COMMITTEE; CORRECT? 

A. CORRECT.

Q. DIRECTING YOUR ATTENTION TO PAGE 41 OF CX 5809, THIS IS 

ENTITLED STRATEGY RECOMMENDATIONS, FIRST STRATEGY 

RECOMMENDATIONS AT THE TOP LEFT, MAKE SURE MTK CAN ONLY GO 

AFTER CUSTOMERS WITH WCDMA SULA. 

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DO YOU SEE THAT? 

A. I DO.

Q. AND FROM THAT RECOMMENDATION THERE'S AN ARROW POINTING TO 

THE RIGHT TO ANOTHER TEXT BOX THAT SAYS REDUCE NUMBER OF MTK'S 

3G CUSTOMERS TO AROUND 50; CORRECT? 

A. YES.

Q. AND THEN THE NEXT STRATEGY RECOMMENDATION AFTER THAT SAYS 

FORMULATE AND EXECUTE A GSM/GPRS STRATEGY TO DESTROY MTK'S 2G 

MARGIN AND PROFIT. 

DO YOU SEE THAT?

A. I DO.

Q. AND FROM THERE -- THERE'S AN ARROW POINTING TO ANOTHER 

TEXT BOX THAT SAYS TAKE AWAY THE DOLLAR SIGN, DOLLAR SIGN THAT 

MTK CAN INVEST IN 3G. 

DO YOU SEE THAT?

A. YES, I DO. 

Q. AND DOLLAR SIGN, DOLLAR SIGN REFERS TO MONEY?

A. YES.

Q. COULD YOU TURN TO TAB 6 IN YOUR BINDER. THIS IS CX 5767. 

THIS IS AN E-MAIL FROM YOU TO SANJAY MEHTA AND OTHERS 

DATED JUNE 19TH, 2015; CORRECT? 

A. THAT'S CORRECT. 

MS. IKEDA: MOVE TO ADMIT CX 5767. 

THE COURT: ANY OBJECTION? 

MR. EVEN: NO OBJECTION. 

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THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 5767 WAS ADMITTED IN EVIDENCE.)

THE COURT: GO AHEAD, PLEASE. 

BY MS. IKEDA:

Q. SUBJECT OF YOUR E-MAIL IS "READ THIS MAV, WHAT IF?" 

DO YOU SEE THAT? 

A. I DO.

Q. AND MAV WAS THE CODE NAME FOR APPLE? 

A. YES.

Q. IN THE FIRST LINE OF YOUR E-MAIL, YOU WERE FOLLOWING UP 

WITH SOME FOLKS TO GET THE LATEST INSIGHT ON AN INTEL IPAD 

LAUNCH. 

DO YOU SEE THAT? 

A. YES.

Q. AND IN YOUR E-MAIL YOU REFERRED TO A GOOD SUMMARY FROM 

MAJID. 

DO YOU SEE THAT? 

A. YES.

Q. AND MAJID WAS A QUALCOMM EMPLOYEE? 

A. YES.

Q. TURNING TO PAGE 3 OF THE DOCUMENT NEAR THE TOP, SECOND 

FULL PARAGRAPH, MAJID SAYS, "IT SEEMS REASONABLE THAT MAV WOULD 

USE AN INTEL BASED IPAD AS A PIPE CLEANER BEFORE LAUNCHING A 

PHONE WITH THEM. 

DO YOU SEE THAT? 

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A. YES. 

Q. AND PIPE CLEANER IN THIS CONTEXT MEANS USING INTEL CHIP IN 

AN IPAD AS A TEST RUN BEFORE USING IT IN AN IPHONE; CORRECT? 

A. YES. 

Q. AND RETURNING TO THE FIRST PAGE OF THIS DOCUMENT, THE 

SECOND BULLET POINT OF YOUR E-MAIL TO MR. MEHTA SAYS, "IF MAV 

WERE TO LAUNCH IN SEPTEMBER OF 2015, WE WOULD GET BACK 200M IN 

VIF AND 445 IN MDF FOR A TOTAL OF 645M IN FYQ 415. 

DO YOU SEE THAT? 

A. I DO. 

Q. AND YOU WERE REFERRING TO THE CONTRACTUAL TIMING OF WHEN 

QUALCOMM WOULD OWE APPLE CERTAIN INCENTIVE PAYMENTS; CORRECT? 

A. YES. I WAS REFERRING TO THE FACT THAT IF APPLE LAUNCHED 

SOMEONE ELSE'S MODEM, THEN THEY WOULD NOT HAVE RECEIVED THAT 

INCENTIVE.

Q. RIGHT. AND YOUR POINT WAS THAT BASED ON THAT CONTRACT, IF 

APPLE WERE TO LAUNCH A COMPETITOR MODEM AT A CERTAIN POINT IN 

TIME, THEN THEY WOULD NOT BE ELIGIBLE FOR CERTAIN PAYMENTS PER 

THE CONTRACT; CORRECT? 

A. THAT'S CORRECT.

Q. AND IN THE LAST SENTENCE OF THAT SAME BULLET POINT IN YOUR 

E-MAIL YOU STATE, MAV ALSO WILL KNOW THE MATH WILL -- STRIKE 

THAT. 

"MAV ALSO WILL KNOW HOW THE MATH WILL WORK AND LIKELY 

WON'T LAUNCH UNTIL AFTER FEBRUARY 15TH OF 2016." 

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DO YOU SEE THAT? 

A. I DO.

Q. AND YOU MADE THAT STATEMENT IN CONNECTION WITH A POTENTIAL 

LAUNCH BY APPLE OF AN INTEL IPAD; CORRECT? 

A. YES. 

Q. YOU WOULD AGREE THAT IN THE MODEM CHIP BUSINESS THE LARGER 

YOUR REVENUE BASE IS, THE MORE IT ALLOWS YOU -- THE MORE IT 

ALLOWS TO YOU MAKE R&D INVESTMENTS TO SUPPORT CUSTOMERS AND 

DEVELOP TECHNOLOGY? 

A. YES, THAT CAN BE HELPFUL.

Q. AND IN GENERAL, WINNING ONE DESIGN WITH AN OEM CAN IMPROVE 

THAT CHIP SUPPLIER'S CHANCES OF WINNING BUSINESS WITH THE OEM 

IN THE FUTURE; CORRECT? 

A. IT DEPENDS IF THEY DO A GOOD JOB. 

Q. BUT IN GENERAL, THAT'S A TRUE STATEMENT; CORRECT?

A. IF THEY PERFORM, YES.

Q. TURNING TO TAB 7 IN YOUR BINDER. THIS IS QX 8292. 

CX 8292 IS AN E-MAIL FROM YOU TO MEG KEDROWSKI CADET AND 

MATTHEW KROPP IN FEBRUARY OF 2016; CORRECT. 

A. YES.

Q. AND MS. KEDROWSKI AND MR. KROPP WERE CONSULTANTS AT BCG AT 

THE TIME? 

A. YES, THEY WERE. 

MS. IKEDA: MOVE TO ADMIT CX 8292. 

THE COURT: ANY OBJECTION? 

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MR. EVEN: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 8292 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MS. IKEDA:

Q. YOU ATTACHED A SLIDE DECK CALLED FQ 16 STRAT PRICING: 

KEY THEMES. 

DO YOU SEE THAT?

A. YES, I DO.

Q. AND YOU WERE INVOLVED IN CREATING THIS PRESENTATION? 

A. YES.

Q. AND THIS WAS PUT TOGETHER BY YOU AND PEOPLE UNDER YOUR 

SUPERVISION? 

A. YES, IT WAS. 

Q. AND IT WAS SHARED WITH OTHER QUALCOMM EXECUTIVES; CORRECT? 

A. IT WAS. 

Q. DIRECTING YOUR ATTENTION TO PAGE 3 OF 8292, THE FIRST 

HEADING UNDER AGENDA SAYS "WINNER TAKE ALL IN THE MOBILE 

SILICON SPACE." 

DO YOU SEE THAT?

A. YES. 

Q. AND UNDERNEATH THAT, IT SAYS, "IT'S VERY SIMPLE: IF YOU 

ARE FIRST," ARROW, "YOU WIN. IF YOU ARE LATE," ARROW, "YOU 

LOSE." 

DO YOU SEE THAT? 

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A. I DO.

Q. AND YOU WOULD AGREE THAT IN THE SEMICONDUCTOR SPACE, BEING 

EARLY IN TERMS OF NEW TECHNOLOGY IS VERY HELPFUL IN TERMS OF 

BEING SUCCESSFUL; CORRECT? 

A. YES. YOU NEED TO WIN EACH OF THE SPECIFIC MODEM SOCKET 

DESIGNS, AND THEY TURN OVER VERY QUICKLY.

Q. DIRECTING YOUR ATTENTION TO PAGE 6 OF CX 8292, THIS IS THE 

SLIDE TITLED WINNER TAKE ALL, TOTAL APPS PROCESSORS AND 

BASEBAND MARKET SHARE IN REVENUE. 

DO YOU SEE THAT? 

A. YES.

Q. THIS SLIDE IS SHOWING THAT QUALCOMM STEADILY INCREASED ITS 

MARKET SHARE FROM 2006 TO 2014; CORRECT? 

A. YES. 

Q. I'D LIKE TO TURN TO PAGE 24 OF CX 8292. THIS IS TITLED 

WINNER TAKE ALL, TOP 5 MARKET SHARE IN REVENUE. 

DO YOU SEE THAT? 

A. I DO. 

Q. AND AT THE BOTTOM OF THIS SLIDE, THERE'S AN ARROW WITH TWO 

TOMBSTONES ON THE END THAT SAY R.I.P.

DO YOU SEE THAT? 

A. I DO.

Q. R.I.P. STANDS FOR REST IN PEACE? 

A. YES.

Q. AND ALONG THAT ROW, IT LISTS FREE SCALE, ST ERICSSON, 

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TEXAS INSTRUMENTS, BROADCOM, AND NVIDIA; CORRECT? 

A. YES.

Q. AND THESE ARE ALL COMPANIES THAT EXITED THE MODEM 

BUSINESS?

A. THEY DID. 

Q. AND ALONG THE LEFT-HAND SIDE OF THE SLIDE, THERE'S A 

COLUMN LABELED MARKET RANKING. 

DO YOU SEE THAT? 

A. I DO.

Q. AND IT SHOWS THAT THE MARKET SHARE RANKING OF VARIOUS 

COMPANIES, INCLUDING QUALCOMM, WHAT THEY ARE FROM 2006 TO 2014; 

CORRECT? 

A. YES.

Q. AND THIS CHART SHOWS THAT QUALCOMM HELD THE NUMBER 2 

POSITION IN 2006 AND 2007; CORRECT? 

A. YES.

Q. AND THEN QUALCOMM MOVED UP TO THE NUMBER 1 POSITION IN 

2008; RIGHT? 

A. YES.

Q. AND QUALCOMM MAINTAIN THAT HAD NUMBER 1 POSITION FROM 2008 

TO 2014; CORRECT? 

A. YES.

Q. AND IN THAT SAME TIME PERIOD, AT LEAST FIVE OTHER MODEM 

CHIP SUPPLIERS FELL INTO THE REST IN PEACE SLOT; CORRECT? 

A. YES. IT'S A VERY COMPETITIVE MARKET. 

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MS. IKEDA: NO FURTHER QUESTIONS. THANK YOU. 

THE COURT: ALL RIGHT. IT'S 10:39. LET'S GO AHEAD 

AND GO TO 10:45, AND THEN WE'LL TAKE A 15 MINUTE BREAK AT THAT 

TIME. 

(PAUSE IN PROCEEDINGS.) 

MR. EVEN: GOOD MORNING, YOUR HONOR. 

THE COURT: ARE YOU READY? 

MR. EVEN: YONATAN EVEN FOR QUALCOMM. 

THE COURT: OKAY. 10:40. 

GO AHEAD, PLEASE. 

CROSS-EXAMINATION

BY MR. EVEN: 

Q. GOOD MORNING, MR. WYATT. 

A. GOOD MORNING. 

Q. I'D LIKE YOU TO TURN BACK TO CX 5767, WHICH I BELIEVE IS 

TAB 6. 

DO YOU REMEMBER YOU WERE ASKED SOME QUESTIONS ABOUT THIS? 

A. YES. 

Q. THE DISCUSSION HERE IN YOUR COMMENT SPEAKS TO WHETHER 

APPLE IS MORE LIKELY TO LAUNCH WITH INTEL IN OCTOBER, NOVEMBER, 

DECEMBER OF 2015 VERSUS FEBRUARY OF 2016; IS THAT RIGHT? 

A. YES. 

Q. DOES QCT BUCKETIZE ITS CHIPS INTO TIERS?

A. WE DO.

Q. AND WHAT DOES QCT REFER TO AS A PREMIUM CHIP? 

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A. WE REFER TO OUR PREMIUM TIER CHIP AS OUR SNAPDRAGON 800. 

Q. AND DO YOU BUCKETIZE YOUR OTHER SERIES OF SNAPDRAGON INTO 

TIERS? 

A. YES, WE DO.

Q. AND WHAT TIERS ARE THOSE? 

A. SO OUR OTHER TIERS OF PARTS ARE THE SNAPDRAGON 600, THE 

SNAPDRAGON 400, THE SNAPDRAGON 200, AND THEN WE ALSO HAVE MDM 

SERIES FOR THIN MODEMS. 

Q. AND DO YOU GIVE NAMES TO THESE TIERS FOR THESE OTHER 

SERIES OF SNAPDRAGON? 

A. YES. 

Q. AND WHAT ARE THOSE? 

A. SO FOR THE SNAPDRAGON 600, THAT'S OUR HIGH SERIES. FOR 

OUR SNAPDRAGON 400, IT'S OUR MID SERIES. 

AND FOR OUR SNAPDRAGON 200, IT'S OUR LOW SERIES. 

Q. AND WHAT IS THE DIFFERENCE BETWEEN A PREMIUM 800 

SNAPDRAGON AND A HIGH 600 SNAPDRAGON? 

A. SO OUR SNAPDRAGON 800 SERIES CHIPS HAS OUR LATEST AND 

GREATEST TECHNOLOGIES. AND OUR TOP TECH PRODUCTS IN EACH OF 

THE TIERS RELATIVE TO THE SNAPDRAGON 600 TIER. 

Q. SO THE 600 DOES NOT FEATURE QCT'S LATEST AND GREATEST 

TECHNOLOGY IN A GIVEN YEAR? 

A. NO, IT DOES NOT.

Q. WHEN ASSESSING THE COMPETITIVE LANDSCAPE, DO YOU TRY TO 

BUCKETIZE COMPETITOR'S CHIPS INTO TIERS TO SEE WHERE THEY 

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COMPETE WITH YOU?

A. YES, WE DO.

Q. AND WHAT ARE THE PRIMARY FACTORS THAT YOU CONSIDER WHEN 

COMPARING COMPETITORS' CHIPS WITH QCT'S? 

A. SO WE TAKE A LOOK AT THE COMPETITOR'S FEATURE SETS S AND 

BASED ON THE COMPETITION'S FEATURE SETS, WE ALIGN THOSE FEATURE 

SETS RELATIVE TO THE SNAPDRAGON LINEUP. 

Q. AND WHEN YOU DO THAT, DO THE COMPETING CHIPSETS HAVE TO 

HAVE THE SAME EXACT SPECIFICATION TO COMPETE WITH BOTH? 

A. NO, THEY DO NOT.

Q. WHY NOT? 

A. CUSTOMERS WILL TAKE A LOOK AT THE RELATIVE VALUE OF A 

COMPETITOR SOLUTION AND WHAT THEIR DIFFERENT FEATURE SETS ARE 

IN TERMS OF THE DIFFERENT TECHNOLOGIES. MOST OFTEN THAN NOT, 

OR ALMOST ALWAYS, THEY'RE NOT IDENTICAL. 

AND SO CUSTOMERS ARE TAKING A LOOK AT THE OVERALL VALUE OF 

THE QUALCOMM SOLUTION AND WHAT TECHNOLOGY AND THE CAPABILITIES 

WE OFFER RELATIVE TO THE PRICE AND THE VALUE AND THE 

TECHNOLOGIES THAT THE COMPETITIVE SOLUTION OFFERS IN EACH GIVEN 

TIER. 

Q. I'D LIKE TO SHOW YOU A SLIDE AND A DOCUMENT MARKED 

QX 9312. 

WHAT IS THIS DOCUMENT? 

A. THIS WAS A COMPETITIVE ANALYSIS DONE IN Q3 OF 2015. 

Q. AND -- CAN WE GIVE A COPY TO -- 

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THE COURT: IS THAT ADMITTED? 

MR. EVEN: THAT HAS NOT YET BEEN ADMITTED, YOUR 

HONOR. 

CAN WE GET A COPY. 

THE COURT: OKAY. LET'S ADMIT IT BEFORE WE PUBLISH 

IT. 

BUT THAT'S FINE. YOU SAID 9312. 

MR. EVEN: IF WE CAN GIVE A COPY TO THE COURT, 

PLEASE. 

THE COURT: IT'S NOT IN YOUR WITNESS BINDER? 

MR. EVEN: IT IS NOT. 

THE COURT: OKAY. 

MR. HUYNH: MAY MR. HUYNH APPROACH? 

THE COURT: YES, PLEASE. 

WHY DON'T YOU GIVE A COPY TO THE FTC IF THEY DON'T HAVE 

ONE. 

MR. HUYNH: ANDREW HUYNH. THEY SHOULD. 

THE COURT: GIVE A COPY TO THE FTC. 

THANK YOU. IS THERE A REASON WHY THIS WASN'T IN YOUR 

WITNESS BINDER? 

MR. EVEN: I APOLOGIZE, YOUR HONOR. THIS WAS ONE OF 

THE DOCUMENTS ACTUALLY THAT THE QCT SAID THEY MIGHT USE, AND I 

DIDN'T REALIZE THEY WERE NOT GOING TO USE IT. I SHOULD HAVE 

PROBABLY PUT IT IN YOUR BINDER AND DIDN'T. 

THE COURT: DOES THE WITNESS HAVE A COPY? 

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DO YOU HAVE A COPY OF THIS? 

THE WITNESS: I DO NOT. 

MR. EVEN: DOES THE WITNESS HAVE A COPY? 

THE COURT: AND THEN ONE FOR FTC, TOO, PLEASE. THANK 

YOU. I DON'T KNOW. 

DO YOU HAVE ONE NOW? 

MR. CARSON: WE DO NOT. 

MR. EVEN: I'LL JUST MOVE ON. 

Q. HOW OFTEN DO YOU CONDUCT COMPETITIVE COMPARISONS BETWEEN 

CHIPSETS, YOUR CHIPSETS AND COMPETITORS? 

A. EVERY DAY. 

Q. NOW, IN QUALCOMM'S STRATEGIC PLANS DO YOU ALSO SOMETIMES 

LOOK AT HANDSET DEALS? 

A. WE DO. 

Q. AND DO PREMIUM HANDSET ALWAYS USE PREMIUM TIER CHIPS AND 

VICE-VERSA? 

A. THEY DO NOT. 

Q. CAN YOU PROVIDE AN EXAMPLE IN WHICH A CHIP THAT QCT WOULD 

CALL PREMIUM, THE SNAPDRAGON 800, WOULD BE IN A DEVICE THAT IS 

SELLING FOR -- AT A PRICE RANGE THAT IS IN A KNOWN PREMIUM 

HANDSET PRICE RANGE? 

A. YES. SO AS AN EXAMPLE ONE OF OUR LARGEST CUSTOMERS IS 

CALLED XIAOMI. X-I-A-O-M-I. 

AND SO XIAOMI, THEY USE OUR -- THEY'RE ACTUALLY OUR NUMBER 

TWO SNAPDRAGON 800 TIER CUSTOMER, AND XIAOMI USES OUR 

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SNAPDRAGON 800 TIER CHIP IN A DEVICE THAT THEY'LL PRICE AS LOW 

AS 2,000 RMB, SO THAT'S ROUGHLY $300 U.S., AND THEY'RE OUR 

NUMBER 2 SNAPDRAGON 800 TIER CUSTOMER.

Q. AND HOW ABOUT THE REVERSE? CAN YOU GIVE AN EXAMPLE OF A 

600 GRADE CHIP IN HANDSETS SELLING FOR ABOVE $400? 

A. YES. SO TWO OF OUR OTHER LARGEST CUSTOMERS IN CHINA, ONE 

IS CALLED OPPO, O-P-P-O, AND THE OTHER IS CALLED VIVO, V-I-V-O, 

AND SO THOSE TWO CUSTOMERS ARE VERY LARGE CUSTOMERS. THEY SELL 

OVER A HUNDRED MILLION HANDSETS PER YEAR, AND THEY WILL USE OUR 

SNAPDRAGON 600 SERIES, AND THEY WILL SELL THAT IN A DEVICE THAT 

IS OVER 3,000 RMB. 3,000 RMB AND 37 RMB. SO IT'S IN THE 

NEIGHBORHOOD OF 4- TO 500 U.S. DOLLARS. 

Q. THANK YOU. 

IF YOU CAN TURN TO THE BINDER THAT YOU GOT FROM US, THE 

SMALL BINDER, AND TURN TO TAB MARKED DEMONSTRATIVE. 

DOES THE WITNESS HAVE A BINDER? 

THE COURT: IT'S 10:48. I APOLOGIZE FOR 

INTERRUPTING. LET'S GO AHEAD AND TAKE OUR BREAK NOW. 

MR. EVEN: YES. THANK YOU, YOUR HONOR. 

THE COURT: WE'LL TAKE A BREAK UNTIL 11:00 O'CLOCK. 

SO THANK YOU FOR YOUR PATIENCE, AND WE'LL SEE YOU BACK. 

WE'RE IN RECESS THANK YOU. 

(RECESS FROM 10:49 A.M. UNTIL 11:02 A.M.) 

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

IT'S NOW 11:02. 

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GO AHEAD, PLEASE. 

MR. EVEN: THANK YOU, YOUR HONOR. 

Q. MR. WYATT, IF YOU CAN TURN TO THE TAB IN YOUR BINDER 

SHOWING THE DEMONSTRATIVES. 

CAN YOU FIND THAT? 

A. YES. 

Q. IN QX 9343, IT SHOWS A LIST OF CHIPS THAT THE FTC 

IDENTIFIED AS PREMIUM LTE CHIPS. 

ARE ALL OF THE CHIPS ON THIS LIST SNAPDRAGON 800 PREMIUM 

TIER CHIPS? 

A. THEY ARE NOT. 

Q. LET'S GO OVER A FEW OF THOSE. 

TURN TO MSM 8976. 

WHAT IS THIS CHIP? 

A. MSM 8976 IS A SNAPDRAGON 600 SERIES CHIP. 

Q. AND SO THAT'S NOT A PREMIUM CHIP? 

A. NO, IT'S NOT.

Q. AND IT WOULDN'T HAVE THE LATEST AND GREATEST TECHNOLOGY AS 

OF THE YEAR IT CAME OUT? 

A. NO, IT WOULD NOT. 

Q. ANY OTHER CHIPS -- 

MS. IKEDA: OBJECTION, YOUR HONOR. LEADING. 

THE COURT: SUSTAINED. THAT'S STRICKEN.

BY MR. EVEN: 

Q. ANY OTHER CHIPS ON THE LIST THAT ARE HIGH TIER SNAPDRAGON 

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600 CHIPS? 

A. YES. SNAPDRAGON -- OR EXCUSE ME. MSM 8956, MSM 8953, MSM 

8952, MSM 8939, AND MSM 8930. 

SO THE SECOND CHIP DOWN TO THE SIXTH CHIP. 

Q. OKAY. HOW MANY OF THOSE CHIPS THAT YOU JUST LISTED WOULD 

HAVE HAD THE LATEST AND GREATEST TECHNOLOGY WHEN THEY CAME OUT? 

A. SO NONE OF THOSE CHIPS WOULD HAVE HAD OUR LATEST AND 

GREATEST TECHNOLOGY. THEY'RE NOT OUR SNAPDRAGON 800 SERIES 

CHIPS.

Q. TURNING TO THE MSM 8916, WHAT IS THAT CHIP? 

A. SO THAT IS OUR SNAPDRAGON 400 SERIES CHIP. IT'S SOLD IN 

THE MID-TIER. 

Q. BASED ON YOUR EXPERIENCE AT THE -- AT QUALCOMM, DO YOU 

HAVE AN EXPLANATION HOW COME ALL THESE NON-PREMIUM CHIPS WERE 

SOLD IN PHONES SELLING FOR MORE THAN $400? 

A. SO AS WE DISCUSSED BEFORE, CERTAIN OEM'S HAVE THE ABILITY 

TO SELL IN THIS CASE EVEN A SNAPDRAGON MID-TIER, OUR 400 SERIES 

CHIP, FROM TIME TO TIME IN A DEVICE THAT'S OVER $400 IN THE 

CASE OF THAT MID-TIER. 

AS WE TALKED ABOUT, THERE'S OTHER CASES WHERE OUR 

SNAPDRAGON 600 SERIES CAN BE SOLD FOR OVER 600 U.S. DOLLARS IN 

A SIGNIFICANT NUMBER OF CASES.

Q. OKAY. DOES QUALCOMM FACE COMPETITION IN THE SALE OF ITS 

SNAPDRAGON 800 AND 600 CHIPSETS? 

A. WE DO. 

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Q. DOES QUALCOMM FACE COMPETITION IN THE SALE OF CDMA CHIPS? 

A. WE DO. 

Q. AND HOW HAS THAT COMPETITION EVOLVED OVER TIME? 

A. OVER TIME THE COMPETITION AND THE COMPETITORS, IT'S BEEN 

MUCH MORE AGGRESSIVE, AND THEY'VE BECOME MUCH MORE COMPETITIVE. 

Q. SO IF YOU TURN TO THE TAB MARKED EXHIBITS IN YOUR BINDER, 

TURN TO QX 9250. YOU'LL SEE THIS IS AN E-MAIL WITH AN 

ATTACHMENT CALLED PRICING. 

A. YES.

Q. WHAT IS THIS ATTACHMENT? 

A. SO THIS WAS AN ANALYSIS, OR A SUMMARY THAT WAS BEING PUT 

TOGETHER FOR BOARD OF DIREC PRICING SUMMARY. BOARD OF 

DIRECTORS. 

Q. AND WHO WOULD HAVE PREPARED THIS? 

A. THIS WOULD HAVE BEEN PREPARED BY MY TEAM. 

MR. EVEN: YOUR HONOR, I'D LIKE TO MOVE QX 9250 INTO 

EVIDENCE. 

THE COURT: ANY OBJECTION? 

MS. IKEDA: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(DEFENDANT'S EXHIBIT QX 9250 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE.

BY MR. EVEN:

Q. CAN YOU TURN TO THE PAGE ENDING IN BATES NUMBER 008. 

A. OKAY.

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Q. WHAT'S DEPICTED ON THIS SLIDE? 

A. SO WHAT THIS SLIDE IS TAKING A LOOK AT IS ON THE LEFT-HAND 

SIDE QUALCOMM AND OUR DIFFERENT CHIPSETS THAT WE HAVE. SO ON 

THE VERY TOP IT'S OUR MSM 8960, WHICH IS OUR SNAPDRAGON 800 

EQUIVALENT, ALL THE WAY DOWN TO OUR SNAPDRAGON 200 EQUIVALENT 

ON THE BOTTOM LEFT, WHICH IS OUR SNAPDRAGON QSC 6240 AND 6270. 

AND WE'RE TAKING A LOOK AT EACH OF THE DIFFERENT 

COMPETITORS THAT WE FACE FOR EACH OF THOSE DIFFERENT TIERS OF 

CHIPS. 

Q. AND BASED ON THE E-MAIL AT THE BEGINNING OF THIS DOCUMENT, 

THIS IS A PICTURE OF THE COMPETITIVE LANDSCAPE AT WHAT TIME? 

A. SO THIS WAS AROUND THE 2010/2011 TIMEFRAME. 

Q. AND WHY DID YOU USE TANKS IN THIS PICTURE? 

A. SO TANKS, THEY WERE JUST A COLORFUL REPRESENTATION OF THE 

LEVEL OF COMPETITIVENESS THAT WE FACED IN EACH OF THESE 

DIFFERENT TIERS. 

Q. CAN YOU TURN TO THE NEXT PAGE. IT'S MARKED CDMA 

BATTLEFIELD. 

WHAT DOES THIS SLIDE DEPICT? 

A. SO THIS IS A SIMILAR TYPE SLIDE TAKING A LOOK AT OUR CDMA 

COMPETITION THAT WE HAD IN EACH OF THE DIFFERENT TIERS. AT THE 

TOP ONCE AGAIN IT'S OUR SNAPDRAGON 800 SERIES, ALL THE WAY DOWN 

TO THE BOTTOM LEFT OF THE SLIDE, WHICH IS OUR SNAPDRAGON 

EQUIVALENT 200 SERIES ON THE CDMA SLIDE. 

AND WE WERE TAKING A LOOK AT THE COMPETITORS THAT WE GAVE 

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ON THE RIGHT-HAND SIDE.

Q. AND SO AT THE TOP TIERS, YOU SEE VIA, TOGETHER WITH 

SAMSUNG OR TI. 

WHAT DOES THAT MEAN? 

A. SO WHAT -- WHAT OUR OEM'S WERE LOOKING TO DO WAS TAKE AN 

AP, SO TEXAS INSTRUMENTS AP OR A SAMSUNG AP, AND THEN THEY 

WOULD COMBINE THAT WITH A VIA MODEM. SO WE WOULD FACE THAT 

COMBINATION -- OR WE ALSO HAVE FUSION TYPE PARTS IN A SIMILAR 

WAY. 

SO WE WOULD FACE THAT FUSION TYPE SOLUTION FROM OUR 

COMPETITORS. 

Q. AND WERE THERE OEM'S THAT USED FUSION TYPE, AS YOU CALLED 

IT, SOLUTION IN THEIR DEVICES FROM VIA? 

A. YES. 

Q. CAN YOU GIVE AN EXAMPLE OF ONE? 

A. ONE THAT I REMEMBER IS HUAWEI ON THE HIGH END USING BOTH 

VIA PLUS TEXAS INSTRUMENTS.

Q. AND DID VIA APPLY PRICING PRESSURE TO QUALCOMM? 

A. THEY DID. 

Q. WERE OEM'S ABLE -- YOU CAN PUT THIS DOWN. 

WERE OEM'S ABLE TO LEVERAGE THEIR DEMAND FOR WCDMA CHIPS 

TO OBTAIN BETTER PRICING FOR CDMA CHIPS? 

A. YES. OEM'S WOULD PUT PRESSURE ON QCT BY STATING THAT THEY 

WOULD NOT PURCHASE OUR WCDMA CHIPS UNLESS WE LOWERED OUR CDMA 

CHIP PRICE. 

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Q. MOVING FORWARD FROM 2010 TO MORE RECENT TIMES. OVER THE 

PAST TWO, THREE YEARS UP TO EARLY 2018, WHAT COMPANIES HAVE 

BEEN QCT'S MAIN COMPETITORS IN LTE? 

A. SO IN LTE OUR MAIN COMPETITORS HAVE BEEN MEDIATEK; EXYNOS, 

SO THAT'S SAMSUNG EXYNOS, E-X-Y-N-O-S; HISILICON FROM HUAWEI; 

INTEL; AND SPREADTRUM. 

Q. AND WHICH OF THESE COMPETITORS OFFER CDMA CAPABLE CHIPS? 

A. ALL OF THOSE COMPETITORS OFFER CDMA CAPABLE CHIPS. 

Q. SO LET'S BREAK THAT DOWN BY CUSTOMER GROUPS. 

AS OF EARLY 2018, WHO WERE THE THREE LARGEST SMARTPHONE 

MAKERS? 

A. SO THE LARGEST SMARTPHONE MAKERS IN THE WORLD ARE APPLE, 

SAMSUNG, AND HUAWEI. 

Q. AND OF THE PREMIUM HANDSET TIER, WHAT PORTION DID THESE 

THREE OEM'S REPRESENT? 

A. SO BETWEEN THE THREE OF THEM, THEY REPRESENT OVER 90 

PERCENT OF THE PREMIUM TIER HANDSET TIER. 

Q. AND WHAT HAS BEEN THE GENERAL TREND OF QCT'S COMPETITIVE 

POSITION IN THESE THREE LARGE OEM'S? 

A. QCT HAS BEEN IN SIGNIFICANT DECLINE AT THOSE OEM'S. 

Q. LET'S WORK DOWN THAT LIST. 

FIRST WE'LL START WITH SAMSUNG. WHAT'S BEEN THE TREND OF 

QCT'S SHARE AT SAMSUNG FOR PREMIUM HANDSETS? 

A. SO OUR TREND HAS BEEN DOWN. OVER THE LAST FEW YEARS OUR 

SHARE AT SAMSUNG IN TERMS OF THEIR PREMIUM TIER CHIPSETS HAS 

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BEEN 35 PERCENT. 

Q. AND WHAT'S THE COMPETITION THAT QCT FACES, OR FACED, AT 

SAMSUNG FOR PREMIUM HANDSETS? 

A. SO WE FACED VERY HEAVY COMPETITION FROM THE SAMSUNG EXYNOS 

CHIPSET SOLUTION. 

Q. AND WHAT PORTION OF QCT'S SNAPDRAGON 800 SALES GO TO 

SAMSUNG? 

A. SO QUALCOMM'S CHIPS, ROUGHLY HALF, A LITTLE LESS THAN HALF 

OF OUR SNAPDRAGON 800 TIER CHIPS TO SAMSUNG. 

Q. TURNING TO HUAWEI, WHAT'S BEEN THE TREND OF QCT'S SHARE AT 

HUAWEI FOR PREMIUM DEVICES? 

A. SO AT HUAWEI, OUR TREND HAS BEEN SIGNIFICANTLY DOWN. 

HUAWEI HAS INTRODUCED THEIR OWN HISILICON CHIPSET SOLUTION. 

AND SO ONCE HUAWEI INTRODUCED THEIR OWN HISILICON SOLUTION 

CHIPSET SOLUTION, IT'S TAKEN OUR, OUR SHARE AT HUAWEI DOWN TO 

ZERO.

Q. SO WHEN IS THE LAST TIME QUALCOMM SOLD A SNAPDRAGON 800 

CHIP TO HUAWEI? 

A. IT WAS A NUMBER OF YEARS AGO. I WANT TO SAY IT WAS OVER 

FOUR YEARS AGO. 

Q. WHAT HAS BEEN QCT'S SHARE TREND AT APPLE? 

A. AT APPLE, OUR SHARE TREND HAS ALSO BEEN DOWN. STARTING IN 

2016, APPLE INTRODUCED THEIR 2016 DESIGN WITH BOTH QUALCOMM AND 

INTEL. 

IN 2017, THEY INTRODUCED WITH BOTH QUALCOMM AND INTEL. 

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AND THEN IT'S GONE DOWN FURTHER FROM THERE.

Q. AND AS OF EARLY 2018, WHAT WAS YOUR FORECAST FOR YOUR 

SHARE AT APPLE? 

A. SO OUR FORECAST OF OUR SHARE OF APPLE IN 2018, WE HAD A 

COUPLE DIFFERENT SCENARIOS. BUT AT THAT POINT IN TIME, OUR 

EXPECTATION WAS THAT WE WERE NOT WIN A SHARE AT APPLE. SO IT 

WOULD BE ZERO FOR THE UPCOMING DESIGN. 

Q. TURNING TO SMALLER COMPETITORS, YOU MENTIONED XIAOMI, 

OPPO, AND VIVO. 

WHAT COMPETITION DOES QUALCOMM FACE AT THOSE OEM'S. 

A. SO WE FACE VERY HEAVY COMPETITION FROM BOTH MEDIATEK, AND 

WE ALSO FACE COMPETITION FROM EXYNOS. 

Q. THERE WAS SOME TESTIMONY IN THIS CASE ABOUT SOMETHING 

CALLED TD-SCDMA 3 MODE CHIPS? WHAT IS TD-SCDMA? 

A. TD-SCDMA IS THE CHINESE STANDARD, PRIMARILY USED BY THE 

CHINESE CARRIER, CHINA MOBILE. 

Q. AND WHO ARE THE BIGGEST SELLERS OF CHIPS FOR TD-SCDMA? 

A. THE BIG DECEMBER SELLERS OF CHIPS WOULD BE MEDIATEK AND 

SPREADTRUM.

Q. AND WHAT WAS QCT'S SHARE OF TD-SCDMA? 

A. IT WAS VERY SMALL. I WANT TO SAY IT WAS LESS THAN 

5 PERCENT. 

Q. YOU WERE ASKED SOME QUESTIONS ABOUT QUALCOMM PRICING. 

DOES QUALCOMM HAVE A BODY OR COMMITTEE THAT DEALS WITH PRICING? 

A. WE DO. 

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Q. WHAT'S THE NAME OF IT? 

A. IT'S CALLED OUR PRC, OR PRICE REVIEW COMMITTEE.

Q. AND WHO'S IN CHARGE OF THE PRC? 

A. I LEAD THE PRC.

Q. WHAT PRICING DOES THE PRC SET? 

A. SO WE WILL SET OUR INITIAL PRICE INDICATIONS FOR A NEW 

CHIPSET THAT'S COMING OUT, AND WE ALSO SET PRICING FOR PRICE 

REQUESTS THAT COME FROM OUR SALES TEAM FOR LOWER PRICING AT 

THEIR CUSTOMERS. 

Q. WHEN YOU GET SUCH REQUESTS FOR LOWER PRICING, ARE THOSE -- 

AND THE PRC DISCUSSES THOSE, DOES THE PRC LOWER THE PRICE 

ACROSS THE BOARD OR DOES IT LOWER IT TO A SPECIFIC CUSTOMER? 

A. IT'S TYPICALLY DONE AT A PARTICULAR CUSTOMER. ON OCCASION 

WE MAY SEE THE SAME TYPE OF REQUEST COMING IN FROM MANY 

CUSTOMERS, AND IN THAT CASE WE MAY LOWER IT ACROSS THE BOARD. 

BUT IT'S TYPICALLY ON A CUSTOMER-BY-CUSTOMER BASIS. 

Q. WHY DOES QUALCOMM NEED TO MOVE ITS PRICE DOWNWARD? WHY 

CAN'T QUALCOMM JUST SELL AT THE INDICATED PRICE? 

A. SO IF WE KEPT OUR PRICE AT OUR ORIGINAL PRICE INDICATION, 

WHAT WOULD HAPPEN IS OUR COMPETITORS WOULD COME IN AT A LOWER 

PRICE THAN US AND THEY WOULD WIN ALL OF THE DESIGN SOCKETS AND 

ALL OF THE SHARE. SO WE WOULD HAVE VIRTUALLY NO SHARE IF WE 

DIDN'T REACT TO THE COMPETITIVE MARKET THAT WE FACE. 

Q. FAIR TO SAY THAT QUALCOMM'S PRICE INDICATIONS ARE 

TYPICALLY HIGHER THAN COMPETITOR'S PRICING?

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A. THEY TYPICALLY ARE, YES. 

Q. DO LICENSING PASS THROUGH RIGHTS AFFECT THE PRICE OF 

CHIPS? 

A. NO. 

Q. ARE THEY TYPICALLY DISCUSSED AT THE PRC? 

A. NO, THEY'RE NOT. 

Q. DO ROYALTIES AFFECT CHIP PRICING? 

A. NO.

Q. SO, FOR EXAMPLE, YOU HAVE TWO OEM'S, ONE IS PAYING 

5 PERCENT, ONE IS PAYING 3 PERCENT ROYALTY. HOW WOULD THAT 

AFFECT THE PRICING OF CHIPS FOR THEM? 

A. IT DOESN'T COME INTO PLAY, OR IT'S NOT SOMETHING THAT WE 

LOOK AT OR WE FACTOR IN WHEN WE'RE MAKING ANY PRICING 

DECISIONS. 

Q. DOES QTL HAVE A REPRESENTATIVE ATTENDING PRC DISCUSSIONS? 

A. THEY DO NOT. 

Q. SO IF QTL WERE GONE TOMORROW, IF IT WAS SHUT DOWN, SPUN 

OFF, ANYTHING LIKE THAT, HOW WOULD THAT AFFECT YOUR FUNCTIONING 

AT THE PRC? 

A. IT WOULDN'T IMPACT OUR PRC PROCESS OR IMPACT THE OUTCOMES. 

Q. HOW MANY TIMES A YEAR DOES QCT QUOTE CHIP PRICING FOR EACH 

CUSTOMER? 

A. WE HAVE THOUSANDS OF QUOTES THAT GO OUT OVER THE COURSE OF 

A YEAR. 

Q. ARE YOU INVOLVED IN LICENSING NEGOTIATIONS? 

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A. I'M NOT.

Q. WHO DO YOU TYPICALLY DEAL WITH AT OEM'S? 

A. SO WE TYPICALLY DEAL WITH THE PROCUREMENT LEAD OR THE 

PRODUCT LEADS AT OEM'S. 

Q. DO YOU EVER DEAL WITH A CUSTOMER'S I.P. DEPARTMENT?

A. I DO NOT. 

Q. QCT HAS ITS OWN R&D DEPARTMENT THAT DEVELOPS ITS PRODUCTS; 

CORRECT? 

A. WE DO.

Q. FOR QCT CHIPS RELEASED UP TO MARCH 2018, HOW DID QCT FUND 

ITS R&D? 

A. SO WE FUND OUR R&D THROUGH OUR GROSS MARGIN AND THE 

PROFITS WITHIN QCT. 

Q. AND HOW MUCH DID QTL CONTRIBUTE TO THE R&D THAT WENT INTO 

DEVELOPING THESE CHIPS? 

A. THEY DID NOT CONTRIBUTE. 

Q. I'D LIKE YOU TO GO BACK TO QX 5809 IN THE FTC'S BINDER. 

A. OKAY. 

Q. THAT'S 041. 

DO YOU REMEMBER THAT SLIDE?

A. I DO.

Q. AND YOU WERE ASKED SOME QUESTIONS ABOUT THE FIRST BULLET. 

WHAT IS THE ISSUE THAT THIS BULLET IS ADDRESSING? 

A. SO WHAT THIS BULLET IS ADDRESSING IS THAT THE NUMBER OF 

CUSTOMERS THAT QCT WAS ABLE TO SELL TO WAS LIMITED BECAUSE 

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THERE WERE MANY CUSTOMERS THAT DID NOT HAVE A QTL LICENSE. AND 

MTK WAS ABLE TO SELL TO CUSTOMERS THAT DID NOT HAVE A QCT 

LICENSE. SO THEY HAD A MUCH LARGER BASE OF CUSTOMERS THAT THEY 

COULD SELL TO VERSUS QCT. SO WE WERE IN AN UNCOMPETITIVE 

SITUATION RELATIVE TO MTK BECAUSE OF THE LICENSING SITUATION. 

Q. AND WAS QCT ABLE TO COMPETE ON A LEVEL PLAYING FIELD WITH 

MEDIATEK WITH THESE UNLICENSED OEM'S? 

A. NO, WE WERE NOT BECAUSE QCT WAS NOT ABLE TO SELL TO THOSE 

UNLICENSED OEM'S. 

Q. AND IF YOU GO BACK TO TAB 4 IN THE FTC'S BINDER, QX 8291, 

GO TO 004. AND IF YOU CAN FOCUS ON THE SAME, THE SAME BLOWOUT 

THAT THE FTC SHOWED YOU, IT SAYS "SOME CUSTOMERS PERCEIVE QCT 

CHIPS TO BE MORE EXPENSIVE, DUE TO LINKAGE TO LICENSING COSTS." 

A. YES.

Q. IS THAT THE SAME PROBLEM THAT YOU JUST MENTIONED? 

A. YES. SO WHAT THE SITUATION WAS HERE IS THAT IF CUSTOMERS 

WERE BUYING QCT CHIPS, THEN CUSTOMERS -- QTL WOULD BE ABLE TO 

SEE THE QCT CHIPS THAT WE WERE SELLING. 

AND SO THERE WAS A HIGHER LIKELIHOOD THAT, THAT THEY WOULD 

BE PAYING ROYALTIES BECAUSE QTL WOULD BE ABLE TO SEE THE CHIPS 

THAT WERE SOLD TO THEM. 

SO IF THEY WERE ABLE TO BUY MTK OR SPREADTRUM CHIPS, THEN 

THEY WOULDN'T HAVE THAT VISIBILITY, WHICH MEANS THAT THEY WOULD 

HAVE AN ADVANTAGE RELATIVE TO OUR QCT CHIPS.

Q. AND WHEN YOU SAY THEY HAD AN ADVANTAGE, YOU MEAN THEY 

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COULD ESSENTIALLY FLY UNDER THE RADAR AND NOT PAY ANY 

ROYALTIES? 

A. THAT'S CORRECT. 

Q. DID YOU GET ANY COMPLAINTS FROM CUSTOMERS ABOUT THE FACT 

THAT SOME PEOPLE ARE ABLE TO AVOID QTL ROYALTIES? 

A. I DID. CUSTOMERS COMPLAINED TO ME THAT IT WAS NOT AN 

EQUAL PLAYING FIELD WHERE SOME CUSTOMERS WERE GOOD CITIZENS AND 

THEY WERE PAYING THEIR CONTRACTUAL ROYALTIES, WHERE OTHERS WERE 

NOT. AND THOSE CUSTOMERS THAT WERE NOT WERE BUYING MTK AND 

SPREADTRUM CHIPS.

Q. TO YOUR KNOWLEDGE DID THERE EVER COME A TIME WHEN MEDIATEK 

STOPPED SELLING ITS CHIPS TO UNLICENSED OEM'S? 

A. NO. FROM MY PERSPECTIVE, I NEVER SAW THAT MTK 

DIFFERENTIATED BETWEEN WHO THEY SOLD TO.

Q. IS THE CONCERN LOST -- IF WE GO BACK TO 5809-41, IS THE 

CONCERN REFLECTED IN THIS FIRST BULLET ABOUT THE LOSS OF 

LICENSING REVENUE OR IS IT ABOUT THE LOSS OF CHIP SALE 

OPPORTUNITIES? 

A. SO THIS IS SPECIFICALLY AROUND CHIP SALE OPPORTUNITIES AS 

WE'VE BEEN DISCUSSING. 

Q. TURNING TO THE SECOND BULLET, YOU WERE ASKED ABOUT THAT 

ONE AS WELL? 

A. YES.

Q. WHAT IS THE ISSUE THAT'S ADDRESSED IN THIS BULLET? 

A. SO WHAT WE WERE CONSIDERING AT THE TIME WAS CREATING A GSM 

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PART IN ORDER TO COMPETE AGAINST MTK ON THE GSM AND GPRS FRONT. 

THERE WAS A SIGNIFICANT AMOUNT OF PROFIT THAT EXISTED IN THAT 

TIER, AND IT WAS SOMETHING THAT WE WERE CONSIDERING. 

Q. DID QUALCOMM EVER ENTER THE 2G GSM SPACE? 

A. WE DID NOT.

Q. DID QUALCOMM MANAGE TO DETER MEDIATEK'S ENTRY INTO 3G? 

A. NO, WE DID NOT.

Q. AND WHAT HAPPENED TO QUALCOMM'S SHARE IN THE 3G SPACE 

FOLLOWING MEDIATEK'S ENTRY? 

A. SO WE, WE WERE THE LEADERS IN TERMS OF SHARE ON 3G, AND 

ONCE MTK ENTERED, MTK WON AND OUR SHARE IN TERMS OF 3G AND OUR 

SHARE HAS GONE DOWN TO VIRTUALLY ZERO ON THE 3G SIDE. 

Q. OKAY. DO YOU NOW HAVE A COPY OF QX 9312 BEFORE YOU? 

A. I DO.

Q. WHAT IS THIS DOCUMENT? 

A. SO THIS WAS A COMPETITIVE ANALYSIS WHICH WAS A DECK WHICH 

WAS DONE IN 2015. 

Q. AND WHAT WAS YOUR ROLE IN -- WITH RESPECT TO THIS DECK? 

A. SO MY TEAM LED PUTTING THIS DECK TOGETHER. 

MR. EVEN: I'D LIKE TO OFFER THIS INTO EVIDENCE, YOUR 

HONOR. 

THE COURT: DO YOU HAVE A COPY OF IT NOW? 

MS. IKEDA: YES, WE DO. 

THE COURT: OKAY. ANY OBJECTION? 

MS. IKEDA: NO OBJECTION. 

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WYATT REDIRECT BY MS. IKEDA

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467

THE COURT: IT'S ADMITTED. 

(DEFENDANT'S EXHIBIT QX 9312 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. EVEN:

Q. MR. WYATT, GOING THROUGH THIS DECK VERY QUICKLY, THIS DECK 

COMPARES SPECIFIC QUALCOMM CHIPS WITH SPECIFIC COMPETITOR'S 

CHIPS; IS THAT FAIR? 

A. THAT'S CORRECT. 

Q. AND DOES IT LOOK AT THE RELATIVE SPECIFICATION OF THE 

CHIP? 

A. IT DOES.

Q. DOES IT LOOK AT THE RELATIVE PRICING OF THE CHIP? 

A. YES, WE LOOK AT BOTH OF THOSE. 

Q. DOES IT LOOK AT HANDSET USE? 

A. NO. I'M NOT SEEING THAT. 

MR. EVEN: THANK YOU, MR. WYATT. 

I HAVE NO FURTHER QUESTIONS, YOUR HONOR. 

THE COURT: OKAY. TIME IS 11:24. 

DO YOU HAVE ANY REDIRECT? 

MS. IKEDA: YES, VERY BRIEFLY. 

THE COURT: OKAY.

REDIRECT EXAMINATION

BY MS. IKEDA: 

Q. SIR, YOU MENTIONED A FEW MINUTES AGO THAT INTEL WAS ONE OF 

THE COMPANIES THAT OFFERS A CDMA CAPABLE CHIP? 

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THE COURT: 11:25. 

THE WITNESS: YES. 

BY MS. IKEDA:

Q. AND IT'S A TRUE STATEMENT THAT AS OF YOUR SWORN DEPOSITION 

IN JANUARY OF 2018 YOU DID NOT KNOW WHETHER INTEL HAD A CDMA 

CHIP THAT HAD EVER BEEN COMMERCIALLY SHIPPED; CORRECT? 

A. THAT'S POSSIBLE. 

Q. THAT'S A TRUE STATEMENT; RIGHT? 

A. I -- I'D HAVE TO LOOK AT THE DEPOSITION. BUT I'M 

GUESSING -- 

Q. TAKE A LOOK AT YOUR DEPOSITION, PAGE 64, LINE 23. YOU 

WERE ASKED, "DO YOU KNOW IF AN INTEL AS OPPOSED TO A VIA CDMA 

CHIP HAS BEEN COMMERCIALLY SHIPPED?" 

YOUR ANSWER WAS, "I DON'T KNOW." 

DO YOU SEE THAT? 

A. YES, I SAID -- "I DON'T KNOW VIA HAS." 

Q. THAT WAS A TRUE STATEMENT AS OF JANUARY 2018; CORRECT? 

A. YES. 

MS. IKEDA: THANK YOU. NO FURTHER QUESTIONS. 

THE COURT: OKAY. TIME IS 11:26. AND YOU STARTED AT 

11:25. 

ANY RECROSS? 

MR. EVEN: NO, YOUR HONOR. 

THE COURT: ALL RIGHT. MAY THIS WITNESS BE EXCUSED, 

AND IS IT SUBJECT TO RECALL OR NOT SUBJECT TO RECALL? 

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UNITED STATES COURT REPORTERS

469

MS. IKEDA: NOT SUBJECT TO RECALL. 

MR. EVEN: NOT BY US, YOUR HONOR. 

THE COURT: OKAY. THEN YOU HAVE COMPLETED YOUR TRIAL 

TESTIMONY, AND YOU'RE FREE TO LEAVE. 

THE WITNESS: THANK YOU. 

THE COURT: ALL RIGHT. CALL YOUR NEXT WITNESS. 

MR. MATHESON: YOUR HONOR, THE FTC CALLS 

CRISTIANO AMON. 

THE COURT: OKAY. 

DO YOU HAVE A SMALLER BINDER? THIS IS HUGE FOR NOT MUCH 

PAPER. I'M JUST CONSTRAINED ON SPACE, AS YOU CAN SEE. IF NOT, 

LATER. BUT IF YOU HAVE ONE, IT WOULD BE APPRECIATED. THANKS. 

MR. BORNSTEIN: DAN, ARE YOU READY FOR HIM? 

MR. MATHESON: YES. 

THE COURT: IS THERE ANY DEPOSITION TRANSCRIPT FOR 

THIS WITNESS? OKAY. THANKS. 

MS. SESSIONS: YOU HAVE ONE FOR ME? 

THE COURT: OKAY. THANK YOU. ALL RIGHT. LET ME 

KNOW WHEN YOU'RE READY. 

OH, YOU WANT TO SEAL SOME THINGS. 

MS. SESSIONS: I THINK WE HAVE SOME SEALING ISSUES. 

I'M NOT SURE. 

THE COURT: ALL RIGHT. NO PROBLEM. 

11:28. 

GO AHEAD, PLEASE. 

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UNITED STATES COURT REPORTERS

470

MS. SESSIONS: DO YOU WANT US -- ARE YOU GOING TO 

LIST THE ONES THAT -- 

MR. MATHESON: THAT YOU SOUGHT TO SEAL? 

MS. SESSIONS: YES. 

MR. MATHESON: CX 5279. 

MS. SESSIONS: YOUR HONOR, WE ARE NOT GOING TO SEEK 

TO SEAL THAT DOCUMENT. 

THE COURT: OKAY. 

MR. MATHESON: CX 6839. 

MS. SESSIONS: WE ARE NOT GOING TO SEEK TO SEAL THAT. 

THE COURT: OKAY. 

MR. MATHESON: CX 6840. 

MS. SESSIONS: WE'RE NOT GOING TO SEEK TO SEAL THAT. 

MR. MATHESON: CX 8276. 

MS. SESSIONS: WE ARE NOT GOING TO SEEK TO SEAL THAT, 

YOUR HONOR. 

MR. MATHESON: JX 0086. 

MS. SESSIONS: YES, THERE ARE PORTIONS OF THAT THAT 

QUALCOMM WILL SEEK TO SEAL. 

THE COURT: OKAY. AND WHAT ARE THEY? 

MS. SESSIONS: FIRST PORTION IS ON PAGE 7, YOUR 

HONOR. 

THE COURT: THAT'S FINE. 

MS. SESSIONS: OKAY. THANK YOU, YOUR HONOR. 

AND PAGE 8. 

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UNITED STATES COURT REPORTERS

471

THE COURT: THAT'S FINE. 

MS. SESSIONS: PAGE 9 AS WELL. 

THE COURT: OKAY. THAT'S FINE. ALL THREE PAGES ARE 

SEALED, 7, 8, AND 9. 

MR. MATHESON: CX 5294. 

THE COURT: ARE YOU GOING TO SEEK TO SEAL ANYTHING IN 

THAT DOCUMENT? 

MS. SESSIONS: YOUR HONOR, JUST GIVE ME A MOMENT AND 

LET ME FIND IT. 

THE COURT: OKAY. 

MS. SESSIONS: NO, YOUR HONOR. 

THE COURT: OKAY. 

MR. MATHESON: I DON'T BELIEVE THEY HAVE SOUGHT TO 

SEAL CX 7606 OR CX 7607. 

THE COURT: IT'S A MAY 24TH, 2011 -- 

MS. SESSIONS: WE ARE NOT GOING TO SEEK TO SEAL THAT 

ONE, YOUR HONOR. 

THE COURT: STRATEGIC PLANS. IT'S QUITE AGED. 

AND THE OTHER ONE IS FISCAL YEAR 2012. 

MR. MATHESON: CX 7644. 

THE COURT: WELL, LET ME JUST CONFIRM ON 7607, ARE 

YOU GOING TO SEAL ANYTHING FROM THAT DOCUMENT? IT IS FISCAL 

YEAR '12, SO IT'S FAIRED AGED. BUT -- 

MS. SESSIONS: JUST GIVE ME ONE MOMENT, YOUR HONOR. 

THE COURT: OKAY. 

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UNITED STATES COURT REPORTERS

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(PAUSE IN PROCEEDINGS.) 

MS. SESSIONS: 7607, NO SEALING, YOUR HONOR. 

THE COURT: OKAY. THANK YOU. 

MR. MATHESON: THE NEXT ONE, YOUR HONOR, IS CX 7644. 

MS. SESSIONS: AND WE HAVE TWO PAGES FROM THAT ONE, 

YOUR HONOR. 

THE COURT: OKAY. AND WHAT ARE THOSE? 

MS. SESSIONS: PAGE 88, AND IT'S PAGE 88 OF THE 

EXHIBIT, NOT OF THE PDF. 

THE COURT: RIGHT. THE PDF, IT'S PAGE 89, RIGHT. 

MS. SESSIONS: IT'S PAGE 87 OF THE PDF, PAGE 88 OF 

THE EXHIBIT. 

THE COURT: MY PAGE 88 OF THE POWERPOINT IS 7644-089. 

IT'S THE P&L COST VARIANCE. 

MS. SESSIONS: IT'S THE PAGE BEFORE THAT ONE, YOUR 

HONOR. 

THE COURT: OKAY. 

MS. SESSIONS: THAT SAYS WAFER COSTS IS THE ONE THAT 

WE'RE SEEKING TO SEAL. 

THE COURT: OKAY. SO THAT IS PAGE 87 OF THE 

DOCUMENT, BUT 88 OF THE BATES NUMBER. 

MS. SESSIONS: YES, YOUR HONOR. 

THE COURT: OKAY. THAT'S FINE. 

MS. SESSIONS: AND THEN PAGE 93 OF THE EXHIBIT STAMP. 

THE COURT: THAT'S FINE. 

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UNITED STATES COURT REPORTERS

473

MS. SESSIONS: THANK YOU, YOUR HONOR. 

THE COURT: SO THAT IS BATES 93. 

OKAY. THAT'S FINE. 

MR. MATHESON: NEXT ONE, YOUR HONOR, IS JX 0096. 

MS. SESSIONS: YES, YOUR HONOR, THERE ARE A FEW PAGES 

FROM THAT ONE AS WELL. 

THE COURT: OKAY. 

MS. SESSIONS: THE FIRST ONE IS PAGE 31. 

THE COURT: OKAY. AND THAT'S THE BATES NUMBER 31? 

MS. SESSIONS: LET ME -- 

THE COURT: THAT'S THE DOCUMENT PAGE 30. 

MS. SESSIONS: LET ME TURN TO IT IN MY BINDER AND 

I'LL CONFIRM. 

THAT'S CORRECT. PAGE 31 OF THE BATES NUMBER, PAGE 30 OF 

THE POWERPOINT. 

THE COURT: THAT'S FINE. THAT'S SEALED. 

MS. SESSIONS: THANK YOU, YOUR HONOR. 

NEXT ONE IS PAGE 49 OF THE BATES NUMBER. 

THE COURT: THAT'S FINE. 49 IS SEALED. 

MS. SESSIONS: PAGE 66 OF THE BATES NUMBERS. 

THE COURT: THAT'S FINE, IT'S SEALED. 

MS. SESSIONS: PAGE 67. 

THE COURT: THAT'S FINE, THAT'S SEALED. 

MS. SESSIONS: 68. 

THE COURT: WHY SHOULD THAT BE SEALED? THAT'S 

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UNITED STATES COURT REPORTERS

474

PROJECTIONS FROM 2012/2013. 

MS. SESSIONS: ON PAGE 68, YOUR HONOR? PAGE 68 OF 

THE BATES STAMP I BELIEVE HAS SPECIFIC PRICING -- 

THE COURT: OH, OKAY. I'M SORRY. I WAS LOOKING AT 

THE WRONG DOCUMENT. 

OKAY, 68, THAT'S FINE. 

MS. SESSIONS: PAGE 78. 

THE COURT: THAT'S FINE. 78 IS FINE. THAT'S SEALED. 

MS. SESSIONS: PAGE 122. 

THE COURT: THAT'S FINE. THAT'S SEALED. 122 IS 

SEALED. 

MS. SESSIONS: THANK YOU, YOUR HONOR. 

PAGE 124. I'M SORRY. PAGE 24 WAS WRITTEN IN ERROR. 

WE'RE NOT SEEKING TO SEAL THAT. 

THE COURT: OKAY. 

MS. SESSIONS: PAGE -- IT'S 125, YOUR HONOR, 124 OF 

THE POWERPOINT. 

THE COURT: THAT'S FINE. 125 IS FINE. THAT'S 

SEALED. 

MS. SESSIONS: PAGE 130 OF THE BATES NUMBERS. 

THE COURT: OKAY. THAT'S SEALED. 

MS. SESSIONS: PAGE 136. 

THE COURT: OKAY. THAT'S SEALED. 

MS. SESSIONS: PAGE 137. 

THE COURT: THAT'S SEALED. 

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UNITED STATES COURT REPORTERS

475

MS. SESSIONS: AND THE LAST ONE IS PAGE 142. 

THE COURT: THAT'S SEALED. 

MS. SESSIONS: THANK YOU, YOUR HONOR. 

THE COURT: OKAY. ANY MORE, OR IS THAT THE LAST 

EXHIBIT? 

MR. MATHESON: THAT IS NOT THE LAST EXHIBIT, YOUR 

HONOR. 

THE ONLY ONES I HAVE SEALING REQUESTS THAT I'VE BEEN 

INDICATED -- SO I BELIEVE CX 6055, THERE IS A SEALING REQUEST. 

IS THAT A -- 

MS. SESSIONS: THAT'S CORRECT. 

MR. MATHESON: CX 8257, THERE'S NO SEALING REQUEST, 

THAT'S MY UNDERSTANDING. 

MS. SESSIONS: CORRECT. 

MR. MATHESON: I BELIEVE THERE IS A SEALING REQUEST 

FOR CX 5321. 

MS. SESSIONS: WE ARE NOT GOING TO SEEK TO SEAL THAT, 

YOUR HONOR. 

THE COURT: OKAY. 

MR. MATHESON: I BELIEVE THERE'S ONE FOR CX 7024.

MS. SESSIONS: WE ARE NOT GOING TO SEEK TO SEAL THAT 

DOCUMENT. 

MR. MATHESON: I BELIEVE THERE'S NO REQUEST FOR 

CX 5393. 

MS. SESSIONS: CORRECT. 

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UNITED STATES COURT REPORTERS

476

MR. MATHESON: NO REQUEST FOR CX 8256. 

MS. SESSIONS: HOLD ON ONE MOMENT. 

THE COURT: YOU SAID 8257. YOU'RE NOT GOING TO SEEK 

SEALING, BUT I DON'T HAVE THAT IN MY BINDER. CX 8257, I DON'T 

HAVE THAT. 

MR. MATHESON: IT SHOULD BE TAB 12 -- OH, IT APPEARS 

BEFORE THE FIRST TAB, YOUR HONOR. 

THE COURT: OH. 

MR. MATHESON: SORRY. WE ACTUALLY -- 

THE COURT: OKAY. I HAVE IT. 

MR. MATHESON: IT'S THE FIRST DOCUMENT WE'RE GOING TO 

USE. SORRY ABOUT THAT. 

THE COURT: OKAY. THAT'S FINE. IS THAT IT? 

MR. MATHESON: I BELIEVE THERE IS NO SEALING REQUEST 

FOR CX 8256, I WANT TO CLARIFY BECAUSE THAT'S A 2016 STRAT 

PLAN. I CAN TELL YOU THE ONLY SLIDE I'M GOING TO USE IF THAT 

WOULD MAKE THINGS EASIER. 

MS. SESSIONS: THAT WOULD BE HELPFUL. 

THE COURT: WELL, BUT ARE YOU GOING TO SEEK TO ADMIT 

THE WHOLE EXHIBIT? 

MR. MATHESON: I AM, YOUR HONOR. 

THE COURT: SO I THINK WE SHOULD WORK OUT THE SEALING 

BECAUSE WE'VE HAD, WHEN CASES ARE ENDED, ANY PARTY CAN COME AND 

ASK TO SEE THE EXHIBITS. SO I RECOMMEND WE GET THE SEALING 

RIGHT BECAUSE OTHERWISE THE CLERK'S OFFICE WILL GIVE ANY MEMBER 

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UNITED STATES COURT REPORTERS

477

WHO REQUESTS AN EXHIBIT THE EXHIBIT UNLESS IT'S SEALED. 

MR. MATHESON: UNDERSTOOD, YOUR HONOR. 

I'M 100 PERCENT CONFIDENT -- WELL, I'M NOT 100 PERCENT. 

I'M HIGHLY CONFIDENT WE DISCLOSED THIS. 

MS. SESSIONS: I'M TRYING TO FIND IT IN MY BINDER AND 

IT'S NOT ON MY LIST. 

MR. MATHESON: IT LOOKS LIKE THIS. I MEAN, THIS IS A 

BIG DOCUMENT. 

MS. SESSIONS: YOU DID, AND I RECOGNIZE IT. SO -- 

JUST GIVE ME ONE MOMENT. 

MR. MATHESON: I CAN HAND YOU THIS COPY IF THAT WOULD 

BE HELPFUL. 

(PAUSE IN PROCEEDINGS.) 

MS. SESSIONS: NOTHING FROM 8256, YOUR HONOR. 

THE COURT: OKAY. THANK YOU. 

MR. MATHESON: I BELIEVE THAT IS THE LAST DOCUMENT 

WITH A SEALING REQUEST, YOUR HONOR. 

THE COURT: OKAY. 

ALL RIGHT. ARE WE SET? 

OKAY. 11:39. 

MR. MATHESON: YES, YOUR HONOR. THANK YOU. 

THE COURT: ARE YOU READY? 

MR. MATHESON: YES, YOUR HONOR. THANK YOU. 

THE COURT: ALL RIGHT. LET'S HAVE THE WITNESS SWORN 

IN, PLEASE. 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

478

(PLAINTIFF'S WITNESS, CRISTIANO AMON, WAS SWORN.)

THE WITNESS: I DO. 

THE CLERK: THANK YOU. PLEASE BE SEATED. 

PLEASE STATE YOUR FULL NAME AND SPELL YOUR LAST NAME FOR 

THE RECORD. 

THE WITNESS: MY NAME IS CRISTIANO AMON. LAST NAME 

A-M-O-N. 

THE COURT: ALL RIGHT. 11:40. GO AHEAD, PLEASE. 

DIRECT EXAMINATION

BY MR. MATHESON: 

Q. GOOD MORNING, SIR. 

YOU ARE THE PRESIDENT OF QUALCOMM AT THIS TIME; IS THAT 

CORRECT? 

A. YES. 

Q. AND PRIOR TO THE PRESIDENT OF QUALCOMM -- BECOMING 

PRESIDENT OF QUALCOMM, YOU WERE THE PRESIDENT OF QCT; IS THAT 

CORRECT? 

A. YES, THAT'S CORRECT. 

Q. NOW, MR. AMON, WE'RE GOING TO BE DISCUSSING THE INDUSTRY 

THROUGHOUT THE DAY. 

PER THE COURT'S ORDER, THE INTRODUCTION OF EVIDENCE FROM 

AFTER MARCH 2018 HAS BEEN EXCLUDED, SO I'D ASK, IF YOU COULD, 

TO REFRAIN FROM REFERRING TO SPECIFIC EVENTS THAT MAY HAVE 

OCCURRED SINCE THAT TIME. 

WOULD THAT BE POSSIBLE? 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

479

A. UNDERSTOOD, YES.

Q. THANK YOU, SIR. 

QUALCOMM WAS THE FIRST BASE SUPPLIER OF LTE BASEBAND 

PROCESSORS; IS THAT RIGHT?

A. YES. 

Q. YOU'D AGREE THAT QUALCOMM'S PRICING FOR LTE CHIPSETS HAS 

BEEN BASED ON QCT'S LEADERSHIP AND DIFFERENTIATION FROM ITS 

COMPETITORS; RIGHT? 

A. I BELIEVE THAT'S CORRECT. 

Q. NOW, WITHIN LTE, QUALCOMM HAS BEEN HISTORICALLY VERY 

SUCCESSFUL IN PROVIDING THE LATEST FEATURES AND BEING FIRST TO 

MARKET WITH THOSE FEATURES; IS THAT RIGHT? 

A. YES, WE'RE BEING FIRST TO MARKET WITH EVERY TRANSITION OF 

LTE.

Q. AND WHEN YOU SAY "EVERY TRANSITION OF LTE," IS IT FAIR TO 

SAY THAT INCLUDES EVERY NEW, HIGHER SPEED OF LTE? 

A. YES, EVERY NEW HIGHER SPEED OF LTE 4G, YES.

Q. AND AS OF THE DATE OF YOUR DEPOSITION, IT'S ACCURATE TO 

STATE THAT QUALCOMM WAS ABLE TO CHARGE A HIGHER PRICE FOR THE 

LATEST MODEM FEATURE SETS IN WHICH IT WAS DIFFERENTIATED FROM 

ITS COMPETITION; RIGHT? 

A. WE HAVE MANY PRODUCTS WITH LTE. FOR THE ADVANCED ONES, 

WHICH ARE THE FIRST TO MARKET, WE HAD A DIFFERENTIATED PRICE OF 

OUR SOLUTIONS. THERE WAS AN LTE PRICING FOR THE LATEST FEATURE 

ON THE ADVANCED CHIPSETS, YES.

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

480

Q. THANK YOU. 

COULD YOU TURN TO YOUR BINDER, SIR, THERE'S ACTUALLY A 

DOCUMENT THAT APPEARS JUST PRIOR TO THE TAB LABELED TAB 1. 

THAT DOCUMENT IS MARKED QX 8257. 

A. YES, I HAVE IT.

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

INVOLVING YOURSELF, MR. MOLLENKOPF, AND OTHER QUALCOMM 

EXECUTIVES IN NOVEMBER 2008? 

A. I DON'T SEE MR. MOLLENKOPF ON THE FIRST PAGE. 

Q. YOURSELF AND MR. MEHTA? 

A. YES, I DO.

Q. OCTOBER OF 2008; IS THAT RIGHT?

A. YES. 

MR. MATHESON: YOUR HONOR, MOVE TO ADMIT CX 8257. 

MS. SESSIONS: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 8257 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Q. FOCUSSING ON THE E-MAIL YOU WROTE ON OCTOBER 24TH, 2008 TO 

MR. MEHTA AND MR. LEDERER, YOU WRITE, "HERE ARE SOME OF THE 

ISSUES: UMTS PRICES WERE HIGHER THAN CDMA DURING INTRODUCTION 

DUE TO QC'S UMTS MODEM LEADERSHIP (= SOLE SUPPLIER)." 

DO YOU SEE THAT? 

A. YES.

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

481

Q. AND YOU WOULD AGREE THAT QUALCOMM WAS THE FIRST TO PROVIDE 

UMTS MODEM CHIPS TO THE MARKET; RIGHT? 

A. FOR THE UMTS, WE ENTERED THE MARKET LATE. BUT WE WERE THE 

FIRST TO PROVIDE TECHNOLOGIES, INCLUDING BROADBAND SPEEDS ON 

THE UMTS. 

Q. COULD YOU TURN TO YOUR DEPOSITION, SIR, WHICH IS IN THE 

BINDER THERE, PAGE 416. 

MS. SESSIONS: EXCUSE ME. DID YOU GIVE A COPY OF HIS 

DEPOSITION? 

THANK YOU. 

BY MR. MATHESON: 

Q. DO YOU RECALL SAYING AT YOUR DEPOSITION, SIR, "SO WE WERE 

THE FIRST TO PROVIDE UMTS IN THE MARKET DURING THE TIME"? 

A. YES.

Q. THAT WAS AN ACCURATE STATEMENT WHEN YOU MADE IT; CORRECT, 

SIR? 

A. AND IT STILL IS. 

Q. ALL RIGHT. CAN WE RETURN TO CX 8257. 

NOW, YOU WRITE BELOW THAT, "UMTS PRICES ARE NOW LOWER THAN 

CDMA NOT DUE TO COST OR VOLUME, BUT DUE TO COMPETITION." 

DO YOU SEE THAT, SIR? 

A. YES. 

Q. THAT WAS A CORRECT STATEMENT WHEN YOU WROTE IT; IS THAT 

TRUE? 

A. YES.

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

482

Q. AND THAT'S ACCURATE; RIGHT? 

A. THAT'S ACCURATE.

Q. COULD YOU SKIP AHEAD IN YOUR BINDER, SIR, TO TAB 17, WHICH 

IS MARKED CX 5393. 

A. YES.

Q. CAN YOU IDENTIFY THIS DOCUMENT, SIR, AS AN E-MAIL EXCHANGE 

INVOLVING YOURSELF, MR. MOLLENKOPF, AND OTHER QUALCOMM 

EXECUTIVES IN JUNE OF 2013? 

A. YES. 

MR. MATHESON: YOUR HONOR, MOVE TO ADMIT CX 5393. 

MS. SESSIONS: NO OBJECTION, YOUR HONOR. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 5939 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Q. TAKING A LOOK, THE SUBJECT OF THIS IS QUESTIONS FROM CT. 

DO YOU SEE THAT? 

A. YES.

Q. CT STANDS FOR CHINA TELECOM? 

A. THAT IS CORRECT.

Q. TURNING TO PAGE 2, THIS E-MAIL IS ADDRESSED FROM QUALCOMM 

EXECUTIVE TO YOURSELF. THE FIRST -- SECOND SENTENCE STATES, 

"HE WANTS US TO EXPLAIN WHY OUR CDMA CHIPSET IS MORE EXPENSIVE 

THAN UMTS." 

DO YOU SEE THAT, SIR?

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

483

A. YES, I DO.

Q. THAT WAS AN INQUIRY FROM CHINA TELECOM REGARDING WHY 

QUALCOMM'S CDMA CHIPSET IS MORE EXPENSIVE THAN COMPETING UMTS 

CHIPSETS; IS THAT RIGHT? 

A. YES. 

Q. TURNING TO THE FIRST PAGE OF THE DOCUMENT, SIR, YOUR 

RESPONSE TO THIS INQUIRY IS -- THERE'S THREE BULLETS. LET'S 

LOOK AT THE SECOND BULLET. 

YOU WRITE, "OUR PRICE IS BASED -- IS NOT BASED ON COST BUT 

ON VALUE." 

DO YOU SEE THAT, SIR? 

A. YES. 

Q. IT'S AN ACCURATE STATEMENT THAT QUALCOMM HAS HISTORICALLY 

PRICED CDMA BASED ON VALUE RATHER THAN COST; RIGHT?

A. YES.

Q. AND LOOKING JUST ABOVE THAT, THE FINAL TWO SENTENCES OF 

THE FIRST BULLET STATE, "OUR PRICE IS COMPETITIVE WITH VIA. 

OBVIOUSLY NOT COMPETITIVE WITH UMTS." 

AT THIS TIME VIA WAS A COMPETING SUPPLIER OF CDMA CHIPS; 

IS THAT RIGHT? 

A. THAT IS CORRECT.

Q. THE THIRD BULLET STATES "DELTA IS VERY HIGH DUE TO UMTS 

PRICING EROSION (MTK, SPREADTRUM). 

DO YOU SEE THAT? 

A. YES.

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

484

Q. WHEN YOU USED DELTA THERE, YOU MEAN THE DIFFERENCE BETWEEN 

CDMA CHIP PRICE AND UMTS CHIP PRICE? 

A. YES. 

Q. PLEASE TURN TO TAB 6 IN YOUR BINDER, SIR, WHICH IS 

CX 5294. 

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

BETWEEN YOURSELF, MR. ABERLE, AND OTHER QUALCOMM EXECUTIVES IN 

JUNE OF 2013. 

A. YES, I DO. 

Q. TURN YOUR ATTENTION TO THE -- 

OH, YOUR HONOR, MOVE TO ADMIT CX 5294. 

THE COURT: ANY OBJECTION. 

MS. SESSIONS: NO, YOUR HONOR. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 5294 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Q. TURNING YOUR ATTENTION TO THE SECOND PAGE OF THE DOCUMENT, 

THERE'S A BULLET THAT STATES "OUR VIEW OF THE CT PROBLEM." 

DO YOU SEE THAT, SIR? 

A. YES. 

Q. CT STANDS FOR CHINA TELECOM AGAIN? 

A. THAT IS CORRECT.

Q. THE FIRST SENTENCE STATES "WHILE THERE'S AN OVERALL 4.50 

TO $7 DOLLARS DELTA BETWEEN THE CHIPSET PRICE OF CDMA AND ITS 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

485

EQUIVALENT UMTS." 

DO YOU SEE THAT, SIR? 

A. YES.

Q. WHEN YOU SAY -- WHEN THIS E-MAIL STATES THERE AN OVERALL 

4.50 TO $7.00 DELTA, THAT MEANS THE CDMA CHIPSET PRICE IS 

HIGHER THAN THE UMTS CHIPSET PRICE; RIGHT? 

A. THAT IS CORRECT. 

Q. TURN YOUR ATTENTION, SIR, TO TAB 1 OF YOUR BINDER, WHICH 

IS CX 5279. 

A. I'M SORRY. YOU SAID TAB 1?

Q. YES. 

A. I HAVE IT. 

Q. WE'RE MOVING BACK IN TIME IN 2008. CAN YOU IDENTIFY THIS, 

SIR, AN E-MAIL EXCHANGE INVOLVING YOURSELF, MR. MOLLENKOPF, AND 

OTHER QUALCOMM EXECUTIVES IN 2008?

A. YES. 

MR. MATHESON: YOUR HONOR, MOVE TO ADMIT CX 5279. 

MS. SESSIONS: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 5279 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Q. TURNING TO THE THIRD PAGE OF THE DOCUMENT, IF YOU LOOK AT 

THE BOTTOM OF THE SECOND PAGE, YOU'LL SEE AN E-MAIL YOU WROTE 

TO STEVE AND JIM. 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

486

DO YOU SEE THAT, SIR? THE BOTTOM OF THE SECOND PAGE, 

THERE'S AN E-MAIL FROM YOURSELF TO STEVE AND JIM. 

A. YES.

Q. AND THAT'S MR. MOLLENKOPF IS STEVE? 

A. THAT IS CORRECT. 

Q. OKAY. THE NEXT PAGE, UNDER THE BOLDED TEXT, "MY 

RECOMMENDATION." THAT'S YOUR RECOMMENDATION YOU'RE MAKING TO 

MR. MOLLENKOPF AT THIS TIME; RIGHT? 

A. YES, I BELIEVE SO.

Q. YOUR FIRST BULLET IS "CONTINUE TO SUPPORT THE VIABILITY 

AND GROWTH OF THE CDMA ECOSYSTEM." 

NOW, CDMA ECOSYSTEM MEANS THE OPERATORS WHO HAD INSTALLED 

INFRASTRUCTURE BASED ON CDMA; RIGHT? 

A. YES. 

Q. DIRECTING YOUR ATTENTION TO THE BOTTOM OF THE PAGE, YOU 

WRITE, "IF THE DECISION IS MADE, I.E., MAINTENANCE OF CDMA 

COMPETITIVENESS." 

NOW, JUST TO PAUSE ON THAT, CDMA COMPETITIVENESS MEANS 

COMPETITIVENESS VERSUS UMTS SOLUTIONS; RIGHT? 

A. IT MEANS THAT A CDMA OPERATOR WILL HAVE THE SAME DEVICE 

THAT UMTS OPERATORS HAVE SO THEY COULD COMPETE AND HAVE THOSE 

AT NOT THE SAME CAPABILITIES OR THE SAME PRICE, OR SIMILAR 

PRICES.

Q. GREAT. THANK YOU. MOVING FORWARD, THIS SENTENCE READS, 

"WE BELIEVE THAT TACTICALLY WE COULD MAKE THE DIFFERENCE AROUND 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

487

10 PERCENT TO MANAGE THE REVENUE EROSION." 

NOW, WHAT YOU MEANT THERE WAS QCT COULD PRICE ITS CHIPSETS 

10 PERCENT HIGHER THAN COMPETING UMTS CHIPSETS; IS THAT RIGHT?

A. THAT IS CORRECT.

Q. AND THE FINAL SENTENCE STATES, "THERE IS NO JUSTIFICATION 

FOR THE 10 PERCENT, BUT WE THINK THAT IT RESIDES WITHIN THE OEM 

THRESHOLD OF TOLERANCES." 

DO YOU SEE THAT, SIR? 

A. YES, I DO.

Q. BY OEM THRESHOLD OF TOLERANCES, YOU MEANT OEM'S 

WILLINGNESS TO PAY; RIGHT?

A. IT MEANT AT THE TIME OEM WILLING TO PAY AND OFFER THE 

DEVICE AT THE COMPETITIVE PRICE WITH UMTS.

Q. OKAY. AND MOVING UP TO THE CENTER OF THE E-MAIL YOU 

WROTE, "THEREFORE," AND YOU HAVE THREE ARABIC NUMERALS. 

TURNING YOUR ATTENTION TO THE SECOND ARABIC NUMERAL, YOU WROTE, 

"QUALCOMM WILL NOT EXERCISE ITS CDMA MARKET SHARE DOMINANCE TO 

PRACTICE UNCOMPETITIVE PRICES." 

DO YOU SEE THAT? 

A. YES, I DO.

Q. AND YOUR VIEW OF RECOMMENDATION OF MAINTAINING A 10 

PERCENT PRICE DEFERENTIAL BETWEEN CDMA CHIPSETS AND COMPETING 

UMTS CHIPSETS WAS CONSISTENT WITH THE RECOMMENDATION NOT TO 

EXERCISE CDMA MARKET SHARE DOMINANCE; RIGHT? 

A. THAT IS CORRECT. 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

488

Q. WHEN YOU WROTE, "MARKET SHARE DOMINANCE," WHAT YOU MEANT 

WAS OEM'S PERCEPTION THAT THERE WERE NO OTHER SOLUTIONS 

AVAILABLE; RIGHT? 

A. IF WE END UP BEING THE SOLE SUPPLIER OF CDMA FOR AN OEM, 

THEN WE WILL BE IN THAT SITUATION. 

Q. TURNING YOUR ATTENTION, SIR, TO YOUR DEPOSITION 

TRANSCRIPT, PAGE 366. DIRECTING YOUR ATTENTION TO LINES 9 

THROUGH 18, DOES THAT REFRESH YOUR RECOLLECTION THAT AT YOUR 

DEPOSITION YOU TESTIFIED WHEN YOU USED THE PHRASE "MARKET 

DOMINANCE," YOU MEANT AN OEM'S PERCEPTION THAT THERE WAS 

DOMINANCE IN THE MARKET BECAUSE THERE'S NO OTHER SOLUTION 

AVAILABLE? 

A. THAT IS CORRECT. 

Q. CAN WE MOVE, SIR, TO TAB 2 OF YOUR BINDER, THE NEXT TAB. 

THIS IS CX 6839. CAN YOU IDENTIFY THIS AS AN E-MAIL EXCHANGE 

BETWEEN YOURSELF AND OTHER QUALCOMM EXECUTIVES IN MAY OF 2009? 

A. YES, I DO. 

MR. MATHESON: YOUR HONOR, MOVE TO ADMIT CX 6839. 

MS. SESSIONS: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 6839 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Q. NOW, MR. KOLIANDER, ERIC KOLIANDER, HIS COMMENTS ARE IN 

RED ON THE FIRST PAGE OF THIS E-MAIL; IS THAT RIGHT? 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

489

A. YES. 

Q. AND MR. ERIC KOLIANDER AT THE TIME WAS THE APPLE ACCOUNT 

MANAGER? 

A. THAT IS CORRECT. 

Q. ARABIC NUMERAL 3 UNDER THE E-MAIL YOU SENT TO 

MR. KOLIANDER READS "THIS ACCOUNT HAS STRATEGIC VALUE." 

DO YOU SEE THAT? 

A. YES.

Q. DIRECTING YOUR ATTENTION TO THE SECOND SENTENCE, YOU WRITE 

"CONSEQUENTLY, I WOULD LIKE TO UNDERSTAND WHAT ELSE WE SHOULD 

ASK TO FURTHER SECURE OUR POSITION AT APPLE/MAXIMIZE OUR 

PRESENT LEVERAGE IF THEY GO CDMA." 

NOW, BY "YOUR PRESENT LEVERAGE IF THEY GO CDMA," YOU WERE 

REFERRING TO THE LEVERAGE THAT QUALCOMM POSSESSED BECAUSE NO 

OTHER CHIP SUPPLIER COULD SATISFY APPLE'S CDMA REQUIREMENTS AT 

THIS TIME; RIGHT? 

A. SPECIFICALLY AT THE TIME, THE APPLE REQUIREMENTS FOR THE 

CHIPSETS, WE BELIEVED THAT WE WERE THE ONLY ONE TO MEET THEIR 

REQUIREMENTS, THEREFORE, THEY WANTED OUR PRODUCTS. SO I FELT 

WE HAVE PRODUCT LEVERAGE BECAUSE THEY WANTED TO USE OUR PRODUCT 

AS WE COULD MEET THEIR REQUIREMENTS.

Q. THANK YOU. 

TURN TO THE NEXT PAGE OF THE DOCUMENT, SIR. AT THE TOP OF 

THE PAGE THERE'S BRACKETED COMMENT FROM EK. 

IS THAT MR. KOLIANDER? 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

490

A. YES. 

Q. AND YOU RESPOND WITH YOUR INITIALS, CA, THAT'S YOURSELF; 

CORRECT? 

A. I CAN'T READ THE PRECISE, LOOKING AT THIS IN COLOR WHETHER 

IT'S HIS QUESTION TO ME OR IT IS MY COMMENT BACK TO HIM.

Q. OKAY. MR. KOLIANDER WRITES, "TRUTHFULLY, WE SHOULD TAKE A 

HARDER LINE WITH THESE ISSUES FOR CDMA SINCE THEIR OPTIONS ARE 

LIMITED." 

THEIR OPTIONS REFERS TO APPLE'S OPTIONS; RIGHT? 

A. THAT IS CORRECT.

Q. TURN YOUR ATTENTION, SIR, TO CX 6840, IT'S THE NEXT TAB 

AND DOCUMENT? 

A. I HAVE IT. 

Q. CAN YOU IDENTIFY THIS, SIR, AS A -- EITHER AN INVITATION 

OR E-MAIL ON WHICH YOU'RE INCLUDED IN JULY OF 2009 AND AUGUST 

OF 2009? 

A. YES, I DO. 

MR. MATHESON: YOUR HONOR, MOVE TO ADMIT CX 6840 INTO 

EVIDENCE. 

MS. SESSIONS: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 6840 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Q. TURNING YOUR ATTENTION TO THE QUESTION POSED ON THE BOTTOM 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

491

OF THE FIRST PAGE, THE QUESTION IS, "NOW THAT THE OPPORTUNITY 

WITH MAVERICK IS CDMA ONLY, WHAT SHOULD OUR PRICING POSITION 

BE?" 

NOW, MAVERICK IN THAT CONTEXT REFERS TO APPLE; CORRECT?

A. YES.

Q. AND THE NEXT BULLET STATES, "RESULTED IN A VERY SPIRITED 

DISCUSSION -- ALL ARE IN AGREEMENT THAT WE WOULD LIKE TO SEE A 

CDMA PRICE PREMIUM OVER UMTS QUOTED PRICE." 

DO YOU SEE THAT, SIR? 

A. YES.

Q. AND THAT MEANS QUALCOMM INTENDED TO QUOTE APPLE A PRICE 

THAT CHARGED A PREMIUM FOR A CDMA CAPABLE CHIP AS OPPOSED TO 

THE PRICE IT QUOTED FOR A CHIP THAT COULD ONLY SUPPORT UMTS; 

RIGHT? 

A. YES. BECAUSE THE CDMA WOULD BE THE SUPER SET, IT WOULD 

HAVE A HIGHER PRICE.

Q. TURNING TO THE NEXT PAGE OF THE DOCUMENT, SIR, 

CX 6840-002, UNDER OPPOSING POINTS, THE VERY FINAL BULLET READ, 

"MAY MOTIVATE MAVERICK TO LIGHT UP A CDMA COMPETITOR." 

NOW, "LIGHT UP" WOULD ENTAIL APPLE GIVING BUSINESS TO A 

QUALCOMM CDMA COMPETITOR; RIGHT?

A. I'M SORRY. I CANNOT LOCATE THE PARAGRAPH. WHAT'S -- 

Q. IT'S HALFWAY DOWN THE PAGE? 

A. OH, I SEE.

Q. OPPOSING POINTS, FINAL BULLET. 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

492

SO IN THAT CONTEXT, MAVERICK LIGHTING UP A CDMA COMPETITOR 

WOULD MEAN MAVERICK GIVING BUSINESS TO A QUALCOMM COMPETITOR; 

RIGHT? 

A. YES. I THINK MY UNDERSTANDING IS AT THAT TIME IT COULD BE 

APPLE WOULD USE A DIFFERENT SOLUTION.

Q. AND THAT CONTINUES -- THAT WAS CONSIDERED UNLIKELY AT THE 

TIME BY QUALCOMM, RIGHT, ACCORDING TO THAT BULLET?

A. THAT IS CORRECT. 

Q. WOULD YOU MOVE, SIR, TO CX 8276. IT SHOULD BE TAB 4 IN 

YOUR BINDER. 

A. READY.

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

YOURSELF, MR. MOLLENKOPF, AND OTHERS IN DECEMBER 2012? 

A. YES, I DO. 

MR. MATHESON: YOUR HONOR, MOVE TO ADMIT CX 8276. 

MS. SESSIONS: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 8276 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Q. THIS E-MAIL RELATES TO PRICING DISCUSSIONS WITH APPLE; IS 

THAT CORRECT? WELL, MAVERICK IN THE SUBJECT LINE OF THE E-MAIL 

IS APPLE; RIGHT? 

A. THAT IS CORRECT. IT TALKS ABOUT PRICING AND SOME PRODUCT 

SCHEDULES AS WELL.

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

493

Q. OKAY. NOW, CAN YOU DIRECT YOUR ATTENTION TO THE BULLET IN 

THE CENTER OF THE PAGE THAT BEGINS, "THE ABOVE MEANS THAT WE 

REDUCE OUR ASP PREMIUM TO BUY EXCLUSIVITY AS DONE IN THE 

ORIGINAL DEAL." 

DO YOU SEE THAT, SIR? 

A. YES, I DO. 

Q. THE ORIGINAL DEAL REFERS TO THE ORIGINAL TRANSITION 

AGREEMENT NEGOTIATED BETWEEN QUALCOMM AND APPLE IN 2011; RIGHT? 

A. I'M ASSUMING, YES. I CAN'T RECALL IF THE NAME WAS 

TRANSITION AGREEMENT FOR SURE, BUT, YES, I'M ASSUMING THAT'S 

THE CASE.

Q. THANK YOU. 

CAN YOU PLEASE TURN TO TAB 7 IN YOUR BINDER, SIR, WHICH IS 

CX 7606. 

A. READY. 

Q. CAN YOU IDENTIFY THIS AS A 2011 QCT STRATEGIC PLAN? 

A. YES. 

MR. MATHESON: YOUR HONOR, MOVE TO ADMIT CX 7606. 

MS. SESSIONS: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 7606 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Q. COULD YOU TURN TO CX 7606-029. THAT REFERS TO THE BATES 

NUMBERS IN THE LOWER RIGHT, NOT THE PAGE NUMBER.

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

494

THIS DISPLAYS QCT MARKET SHARE BY TECHNOLOGY; CORRECT. 

A. YES. 

Q. FOR FISCAL YEAR 2010, THE CDMA QCT MARKET SHARE IS 95 

PERCENT; RIGHT? 

A. YES, THAT'S WHAT IT SAYS.

Q. AND THIS SEPARATELY PRESENTS WCDMA MARKET SHARES AND LTE 

MARKET SHARES; RIGHT? 

A. YES. 

Q. TURN TO THE NEXT PAGE OF THE DOCUMENT, SIR, IT ENDS IN 

DASH 030. 

I'D LIKE TO DIRECT OUR ATTENTION TO THE LITTLE RECTANGLES 

IN BETWEEN THE TOP DRAFT AND THE BOTTOM CHART. 

LOOKING AT THE BOTTOM CHART, THE TIERS ON THE LEFT ARE 

TABLET/SMARTPHONE, SMARTPHONE HIGH, SMARTPHONE MID, AND THEN ON 

DOWN. 

DO YOU SEE THAT? 

A. YES. 

Q. ALL RIGHT. DIRECTING YOUR ATTENTION TO THE RECTANGLES, 

THE SECOND ONE FROM THE RIGHT IS SP HIGH, $300 AND UP. 

DO YOU SEE THAT, SIR? 

A. YES.

Q. THAT REFERS TO THE SMARTPHONE HIGH TIER; RIGHT? 

A. I THINK AT THAT TIME IT REFERS TO THE SMARTPHONE HIGH 

TIER, YES.

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

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

495

TAB 8. 

CAN YOU IDENTIFY THIS, SIR, AS A 2012 QCT STRAT PLAN? 

A. YES. 

MR. MATHESON: YOUR HONOR, MOVE TO ADMIT CX 7607. 

MS. SESSIONS: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 7607 WAS ADMITTED IN EVIDENCE.) 

THE COURT: AND I APOLOGIZE, BUT I'M GOING TO 

INTERRUPT YOU HERE SO WE CAN TAKE OUR LUNCH BREAK. 

MR. MATHESON: THANK YOU, YOUR HONOR. 

THE COURT: OKAY. THE TIME IS NOON. SO WE WILL TAKE 

A ONE HOUR BREAK. I'LL SEE EVERYONE BACK AT 1:00 O'CLOCK. 

THANK YOU VERY MUCH. 

(THE LUNCH RECESS WAS TAKEN FROM 12:00 P.M. UNTIL 1:01 

P.M.) 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

496

AFTERNOON SESSION

(COURT CONVENED AT 1:01 P.M.)

THE COURT: WELCOME BACK. PLEASE TAKE A SEAT. 

TIME IS 1:01. GO AHEAD EXAMINE CONTINUE, PLEASE. 

MS. SESSIONS: I'M SORRY, YOUR HONOR, BEFORE 

MR. MATHESON BEGINS HIS EXAMINATION, I APOLOGIZE, BUT IN THE 

CONFUSION ABOUT THE SEALING DOCUMENTS THIS MORNING, WE HAD 

TALKED ABOUT CX 8256 -- 

THE COURT: OKAY. 

MS. SESSIONS: -- WHICH, IN FACT, QUALCOMM IS MOVING 

TO SEAL. 

THE COURT: OKAY. 

MS. SESSIONS: QX 8256 IS A 2016 STRATEGIC PLAN, AND 

THROUGHOUT THE DOCUMENT THERE'S DETAILED INFORMATION ABOUT 

FINANCIAL PLANNING THROUGH 2021, AS WELL AS STRATEGIC BUSINESS 

PLANS THROUGH 2021, AND DUE TO THE FACT THAT THIS STRATEGIC 

INFORMATION IS THROUGHOUT THE DOCUMENT, QUALCOMM WOULD MOVE TO 

SEAL THE ENTIRE DOCUMENT. 

THE COURT: THAT'S DENIED. THERE'S NOTHING 

CONFIDENTIAL IN PAGE 1. 

MS. SESSIONS: OKAY. 

THE COURT: 2 IS A BLANK BLUE PAGE WITH ZERO TEXT. 3 

IS ALSO A BLANK PAGE WITH ONLY ATTORNEYS BATES NUMBER AND -- 

MS. SESSIONS: OKAY. YOUR HONOR -- 

THE COURT: AND 4 IS A BLANK BLUE PAGE. 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

497

MS. SESSIONS: I CAN GO PAGE BY PAGE. 

THE COURT: YES. 

MS. SESSIONS: PAGE 10 IS THE FIRST PAGE THAT 

QUALCOMM WOULD SEEK TO SEAL. 

THE COURT: THAT'S FINE. THAT'S SEALED. 

MS. SESSIONS: OKAY. PAGE 18. 

THE COURT: THAT'S FINE. 

MS. SESSIONS: PAGE 20. 

THE COURT: OKAY. THAT'S FINE. 

MS. SESSIONS: PAGE 21. 

THE COURT: THAT'S FINE. 

MS. SESSIONS: PAGE 26. 

THE COURT: YES. 

MS. SESSIONS: 28. 

THE COURT: SEALED. 

MS. SESSIONS: 29. 

THE COURT: SEALED. 

MS. SESSIONS: 30. 

THE COURT: SEALED. 

MS. SESSIONS: 32. 

THE COURT: SEALED. 

MS. SESSIONS: 33 THROUGH 37. 

THE COURT: THAT'S SEALED. 

MS. SESSIONS: 39. 

THE COURT: YOU SAID 32 THROUGH 37; CORRECT? 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

498

MS. SESSIONS: I SAID 32 THROUGH 37, YES, YOUR HONOR. 

THE COURT: THAT'S SEALED. 

MS. SESSIONS: 39. 

THE COURT: THAT'S FINE. 

MS. SESSIONS: 41. 

THE COURT: I'LL SEAL THAT. 

MS. SESSIONS: 55. 

THE COURT: YES. 

MS. SESSIONS: 63. 

THE COURT: YES. 

MS. SESSIONS: 64. 

THE COURT: YES. 

MS. SESSIONS: 66. 

THE COURT: I THINK THAT ONE IS BORDERLINE. 

WHAT'S -- WHAT'S NECESSARY ABOUT THIS? 

MS. SESSIONS: YOUR HONOR, I BELIEVE THAT IT INCLUDES 

ANTICIPATED FEATURES OF A PRODUCT THAT HAS NOT BEEN RELEASED 

PUBLICLY YET. 

THE COURT: ALL RIGHT. THAT'S FINE. THAT'S 66. 

MS. SESSIONS: THE NEXT ONE IS 69. 

THE COURT: THAT'S FINE. 

MS. SESSIONS: 73. 

THE COURT: THAT'S FINE. 

MS. SESSIONS: 74. 

THE COURT: YES. 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

499

MS. SESSIONS: 76. 

THE COURT: YES. 

MS. SESSIONS: 78. 

THE COURT: YES. 

MS. SESSIONS: 79. 

THE COURT: YES. 

MS. SESSIONS: 84. 

THE COURT: YES. 

MS. SESSIONS: 105. 

THE COURT: YES. 

MS. SESSIONS: 106, 107, 10 -- I'M ACTUALLY GOING 

THROUGH 110. SO 105 THROUGH 110. 

THE COURT: THAT'S FINE. 

MS. SESSIONS: PAGE 112, ONLY THE RIGHT HALF OF THE 

DOCUMENT. 

THE COURT: OKAY. 

MS. SESSIONS: PAGE 113. 

THE COURT: THIS IS PROSPECTIVE AS WELL -- OR IT'S 

NOT CLEAR FROM THE PAGE ITSELF? 

MS. SESSIONS: YOUR HONOR, I BELIEVE IT'S 

PROSPECTIVE. BUT I -- I'M NOT POSITIVE. 

THE COURT: I'M GOING TO DENY ON THIS. 

MS. SESSIONS: OH, IT IS -- SORRY, YOUR HONOR. I 

JUST WAS TOLD THAT THIS IS -- SLIDE 113. 

THE COURT: IT'S 2016. 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

500

MS. SESSIONS: IT IS A -- 

THE COURT: PROSPECTIVE TO WHAT, 2018? 

MS. SESSIONS: -- PLANNING DOCUMENT FOR FUTURE 

PLANNED PRODUCTS THAT I DON'T THINK HAVE BEEN RELEASED YET. 

THE COURT: IT'S AN 18-MONTH SHELF LIFE. THESE ARE 

ALL FROM JUNE OF 2018. 

WE'RE GOING ON MORE THAN TWO AND A HALF YEARS. 

I DON'T THINK IT'S SEALABLE. BUT -- I'M GOING TO DENY ON 

113. 

GO AHEAD, PLEASE. 

MS. SESSIONS: OKAY. 114, PLEASE. 

THE COURT: THAT'S DENIED. 

MS. SESSIONS: 115. 

THE COURT: GRANTED. 

MS. SESSIONS: 128. 

THE COURT: GRANTED. 

MS. SESSIONS: 129. 

THE COURT: GRANTED. 

MS. SESSIONS: 132. 

THE COURT: GRANTED. 

MS. SESSIONS: 133. 

THE COURT: GRANTED. 

MS. SESSIONS: 135. 

THE COURT: GRANTED. 

MS. SESSIONS: 136. 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

501

THE COURT: GRANTED. 

MS. SESSIONS: 141. 

THE COURT: GRANTED. 

MS. SESSIONS: 142. 

THE COURT: GRANTED. 

MS. SESSIONS: 143. 

THE COURT: GRANTED. 

MS. SESSIONS: 144. 

THE COURT: GRANTED. 

MS. SESSIONS: 145. 

THE COURT: GRANTED. 

MS. SESSIONS: 146. 

THE COURT: YES, GRANTED. 

MS. SESSIONS: 149. 

THE COURT: OKAY. GRANTED. 

MS. SESSIONS: 150. 

THE COURT: GRANTED. 

MS. SESSIONS: 152. 

THE COURT: GRANTED. 

MS. SESSIONS: 156. 

THE COURT: GRANTED. 

MS. SESSIONS: 157. 

THE COURT: OKAY. GRANTED. 

MS. SESSIONS: 158. 

THE COURT: THAT'S DENIED. 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

502

MS. SESSIONS: 159. 

THE COURT: GRANTED. 

MS. SESSIONS: 160. 

THE COURT: GRANTED. 

MS. SESSIONS: 166. 

THE COURT: GRANTED. 

MS. SESSIONS: AND 167. 

THE COURT: GRANTED. 

MS. SESSIONS: THANK YOU, YOUR HONOR. 

THE COURT: OKAY. THANK YOU. 

OKAY. TIME IS 1:10. 

GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Q. THANKS FOR JOINING US, SIR. 

COULD YOU TAKE A LOOK AT TAB 8 OF YOUR BINDER, CX 7607. 

THIS IS THE 2012 COMMITMENT TO THE INDUSTRY STRAT PLAN WE WERE 

DISCUSSING. 

COULD YOU PLEASE TURN YOUR ATTENTION TO CX 2607. IT'S TAB 

8 IN YOUR BINDER. 

TURNING YOUR ATTENTION TO THE TOP LEFT OF THE CHART. WE 

CAN BLOW THAT UP. 

A. I'M SORRY, WHICH PAGE?

Q. 061. CX 7607-01? 

A. THANK YOU.

Q. THIS REPRESENTS HANDSET PREMIUM TIER IN WHICH THE HANDSET 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

503

IS PRICED OVER $300; CORRECT? 

A. YES, THAT'S CORRECT.

Q. AND IT INDICATES THAT QUALCOMM ASSOCIATES A $4 CDMA ADDER 

WITH PHONES IN SUCH A TIER; IS THAT RIGHT? 

A. YES, THAT IS CORRECT. 

Q. TURN TO THE NEXT TAB IN YOUR BINDER, SIR, WHICH IS TAB 9. 

THIS IS CX 7644. CAN YOU IDENTIFY THIS AS THE QCT 2000 -- 

FISCAL YEAR 2014 STRAT PLAN? 

A. THAT IS CORRECT. 

MR. MATHESON: YOUR HONOR, MOVE TO ADMIT CX 7644. 

MS. SESSIONS: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 7644 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Q. NOW, TURNING YOUR ATTENTION TO THE SECOND PAGE OF THE 

DOCUMENT, CX 7600-002, THIS IS DATED JUNE 10TH, 2013; RIGHT? 

A. THAT IS CORRECT.

Q. AND TURN YOUR ATTENTION TO CX 7644-054, SIR. 

A. READY. 

Q. SO TURNING YOUR ATTENTION TO THIS TABLE IN THE TOP LEFT, 

THE SMARTPHONE PREMIUM SEGMENT IS NOW ASSOCIATED WITH A HANDSET 

PRICE OF $400 IN THERE; RIGHT? 

A. YES, THAT'S WHAT THE DOCUMENT SAYS. 

Q. AND LOOKING DOWN ONE TIER, THE SMARTPHONE HIGH TIER IS 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

504

ASSOCIATED WITH A PRICE OF $250 TO $400; RIGHT? 

A. THAT IS CORRECT. 

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

WHICH IS TAB 10, JX 0096. CAN YOU IDENTIFY THIS, SIR, AS THE 

2015, FISCAL YEAR 2015, THAT IS, QCT STRAT PLAN? 

A. IT'S THE SECOND PAGE IS THE 2014 STRATEGIC PLAN FOR 2015. 

Q. THAT'S A TRUE STATEMENT. 

TURN YOUR ATTENTION, SIR, TO THE DATE OF THE DOCUMENT, 

THIS IS JUNE 2014; RIGHT? 

A. THAT IS CORRECT.

Q. AND THE TITLE OF THE POWERPOINT, TURNING YOUR ATTENTION TO 

THE FIRST PAGE, JX 0096-001, IS FY 15 STRAT PLAN DECK; RIGHT? 

A. THAT LOOKS TO ME IS THE FILE NAME. 

Q. OKAY. TURN YOUR ATTENTION, SIR, TO PAGE DASH 0126. IT'S 

JX -- 

OH, YOUR HONOR, MOVE TO ADMIT INTO EVIDENCE JX 0096. 

MS. SESSIONS: NO OBJECTION. 

THE COURT: ALL RIGHT. IT'S ADMITTED. 

(JOINT EXHIBIT JX 0096 WAS ADMITTED IN EVIDENCE.) 

THE COURT: AND YOU'LL NOTE IN THE JOINT EXHIBIT LIST 

THE SEALED PAGES OF THIS DOCUMENT? 

MR. MATHESON: YES, YOUR HONOR. 

Q. PAGE JX 0096-0126. 

A. YES. 

Q. NOW, THE PREMIUM HIGH TIER INDICATED IN THIS JUNE 2014 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

505

PRESENTATION COVERS HANDSETS ASSOCIATED WITH A PRICE OF $250 TO 

$400 AND UP; IS THAT RIGHT? 

A. THAT IS CORRECT. 

Q. AND THE FORECAST IN JUNE 2014 WAS THAT BY THE FOURTH 

QUARTER OF 2014, MEDIATEK WOULD HAVE A PRODUCT IN THE HIGH OR 

PREMIUM TIER ACTION, IS THAT ACCURATE BASED ON THIS DOCUMENT? 

A. BASED ON THIS DOCUMENT, THIS IS WHAT IT'S SHOWING, THEY 

WOULD HAVE A PRODUCT IN THAT CATEGORY.

Q. NOW, MEDIATEK DID NOT ACTUALLY LAUNCH A PRODUCT IN THE 

PREMIUM TIER IN 2014, DID IT? 

A. I DON'T KNOW IF THEY SPECIFICALLY LAUNCHED THIS PRODUCT 

AND WHETHER IT WAS APPLIED TO THE PREMIUM TIER. I DON'T KNOW. 

Q. AND YOU DON'T KNOW IF MEDIATEK LAUNCHED ANY PRODUCTS THAT 

QUALCOMM CONSIDERED TO BE IN THE PREMIUM TIER IN 2015; IS THAT 

CORRECT? 

A. IN 2015, WE DEFINE OUR PREMIUM TIER, WHICH IS THE 

SNAPDRAGON 800, WE DO NOT BELIEVE MEDIATEK HAD A PRODUCT IN 

THAT CATEGORY. 

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

TO TAB 16, WHICH IS CX 8256. 

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

JULY OF 2016 ATTACHING QCT STRAT PLAN DECKS? 

A. YES, I DO. 

MR. MATHESON: YOUR HONOR, SEEK TO ADMIT CX 8256. 

MS. SESSIONS: NO OBJECTION. 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

506

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 8256 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Q. TURN YOUR ATTENTION, SIR, TO CX 8256-112. 

MS. SESSIONS: THIS IS A SLIDE WHERE PART OF IT HAS 

BEEN SEALED. 

MR. MATHESON: CORRECT. SO WE ARE BLOCKING THIS OFF 

FROM THE PUBLIC VIEW, YOUR HONOR, BUT YOU CAN SEE IT ON YOUR 

SCREEN. 

Q. AND, SIR, YOU SHOULD BE ABLE TO SEE IT ON YOUR SCREEN AS 

WELL. 

THE COURT: WHICH PAGE NUMBER? 

MR. MATHESON: CX 825-112. THE RIGHT-HAND PORTION OF 

THE DOCUMENT HAS BEEN SEALED. I'LL REFER TO THE LEFT-HAND 

PORTION OF THE DOCUMENT WHICH HAS NOT BEEN SEALED. 

THE COURT: OKAY. 

THE WITNESS: I HAVE IT. 

BY MR. MATHESON: 

Q. IT'S ACCURATE, SIR, THAT IN 2016 QUALCOMM CONTINUED TO 

VIEW PREMIUM TIER CHIPS AS ASSOCIATED WITH HANDSET PRICES OF 

$400 AND UP; IS THAT RIGHT? 

A. IN -- THAT'S WHAT THIS SLIDE IS SAYING, THAT IS CORRECT. 

Q. CAN WE ADDRESS 5G BRIEFLY, SIR. 

NOW, AGAIN, I DON'T WANT TO REFER TO ANY SPECIFIC EVENTS 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

507

THAT OCCURRED SINCE YOUR MARCH 2018 DEPOSITION. IT'S ACCURATE 

THAT AT YOUR MARCH 2018 DEPOSITION, YOU BELIEVED THAT 

QUALCOMM'S 5G MODEM WAS SIGNIFICANTLY AHEAD OF THE COMPETITION 

IN TERMS OF DEVELOPMENT; IS THAT RIGHT? 

A. THAT IS CORRECT.

Q. AND YOU BELIEVE THAT QUALCOMM WILL HAVE A TIME TO MARKET 

ADVANTAGE IN ITS 5G MODEM COMPARED TO THE COMPETITION; RIGHT? 

A. YEAH. THAT HAS BEEN OUR GOAL, AND THAT'S WHAT WE'RE 

AIMING FOR. 

Q. TURN TO CX 5321, WHICH IS TAB 13 IN YOUR BINDER, SIR. 

A. I HAVE 50 -- TAB 18 IS 5053.

Q. TAB 13, I BELIEVE. 

A. OH, 13. I'M SORRY. READY. 

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

YOU WERE INVOLVED IN DECEMBER OF 2015? 

A. YES. 

MR. MATHESON: YOUR HONOR, MOVE TO ADMIT CX 5321. 

MS. SESSIONS: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 5321 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Q. NOW, TURNING YOUR ATTENTION TO THE E-MAIL YOU RECEIVED 

THAT, AT THE BOTTOM OF THIS PAGE, ADDRESSED TO DEREK, 

CRISTIANO, AND ERIC, IN 2015 QUALCOMM WAS ENGAGED IN A LICENSE 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

508

DISPUTE WITH VIVO. IS THAT ACCURATE? 

A. I CAN'T REALLY RECALL IF THERE WAS A LICENSE DISPUTE WITH 

VIVO AT THE TIME.

Q. TURN YOUR ATTENTION, SIR, TO THE SECOND PAGE OF THE 

DOCUMENT. THE BOLDED PORTION AT THE BOTTOM, IT BEGINS, "DURING 

THE LAST 24 HOURS," AND THE FINAL LINES READ, THAT VIVO HAS 

REQUESTED. IS IT FAIR TO STATE THAT VIVO HAS REQUESTED THAT IF 

QTL PROVIDES CONFIRMATION, THAT IF VIVO CONTINUES TO NEGOTIATE 

WITH QTL IN GOOD FAITH, QCT WILL CONTINUE SHIPPING CHIPSETS? 

DO YOU SEE THAT, SIR? 

A. YES, I DO.

Q. DOES THAT REFRESH YOUR RECOLLECTION THAT QUALCOMM WAS 

ENGAGED IN A LICENSE DISPUTE WITH VIVO AT THE TIME IN 2015? 

A. IT REFRESHED MY RECOLLECTION THAT A LICENSE WILL BE 

REQUIRED FOR VIVO TO ENGAGE IN CHIPS WITH QCT, AND WE WERE AT 

THAT POINT IN TIME WAITING THAT PROCESS.

Q. NOW, ONE OF THE THINGS THAT VIVO OFFERED WAS TO REFRAIN 

FROM LAUNCHING PHONES WITH MEDIATEK CHIPSETS; IS THAT RIGHT?

A. THAT'S NOT WHAT THIS IS SAYING. 

Q. TURN YOUR ATTENTION, SIR, TO THE FIRST PAGE. THE E-MAIL 

ADDRESSED TO YOURSELF, DEREK, AND ERIC READS, "THE OBJECTIVE OF 

THIS E-MAIL IS TO REQUEST CONFIRMATION FROM YOU SUCH THAT IF 

VIVO NEGOTIATES ITS QTL LICENSE IN GOOD FAITH THAT QCT WILL 

CONTINUE SHIPPING CHIPSETS." 

AND THEN THERE'S A SUMMARY OF THE ADVANTAGES FOR QCT; IS 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

509

THAT RIGHT? 

A. I'M SORRY. WHAT'S YOUR SECOND QUESTION? THERE IS A 

SUMMARY, AND THEN WHAT? 

Q. THE NEXT SENTENCE STATES, THERE IS A SUMMARY OF ADVANTAGES 

THAT THIS DEAL PRESENTS FOR QCT; RIGHT? 

A. THAT IS CORRECT. 

Q. AND ONE OF THE ADVANTAGES IS THAT QCT CAN ACHIEVE 100 

PERCENT OF VIVO'S ROADMAP IN THE FACE OF, FIRST, MTK HAS PIN 

FOR PIN AND SOFTWARE COMPATIBILITY. 

THAT'S THE FIRST CONSIDERATION; CORRECT? 

A. GIVE ME A MOMENT TO READ. 

(PAUSE IN PROCEEDINGS.) 

THE WITNESS: WHAT THIS IS SAYING IS THAT WE CAN 

ACHIEVE 100 PERCENT OF VIVO ROADMAP, AND THEY SAID IN THE FACE 

OF ONE DESCRIBING MEDIATEK COMPETITION ADVANTAGES THAT THEY 

HAVE, PIN AND SOFTWARE COMPATIBILITY WITH WHATEVER THE 

INCUMBENT CHIPSET IN VIVO WAS.

BY MR. MATHESON:

Q. THANK YOU. IF YOU TURN YOUR ATTENTION TO THE SECOND PAGE 

OF THE DOCUMENT, SIR? 

A. YES.

Q. THE SECOND MAJOR BULLET PORTION READS, "WHAT VIVO WILL 

COMMIT TO PENDING QTL CONFIRMATION THAT IF VIVO CONTINUES TO 

NEGOTIATE WITH QTL IN GOOD FAITH, QCT WILL CONTINUE SHIPPING 

CHIPSETS." 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

510

DO YOU SEE THAT, SIR? 

A. THAT IS CORRECT.

Q. AND THE VERY FIRST BULLET READS "WILL NOT LAUNCH CS 

6755/6750 BASED HANDSETS (WHICH MEANS QCT WILL WIN SIGNIFICANT 

UPSIDE IN 2016)." 

NOW, 6755/6750 REFERRED TO MEDIATEK CHIPS; RIGHT? 

A. I BELIEVE SO. 

Q. TURN YOUR ATTENTION, SIR, TO TAB 18 OF YOUR BINDER, WHICH 

IS CX 5053. 

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

IN WHICH YOU WERE INVOLVED IN 2012 WITH MR. MOLLENKOPF AND 

OTHERS? 

A. YES, I DO. 

Q. TURN YOUR ATTENTION TO THE SECOND PAGE OF THE DOCUMENT, 

SIR, CX 5053-002. 

THIS IS AN E-MAIL EXCHANGE BETWEEN YOURSELF AND 

MR. REIFSCHNEIDER; IS THAT CORRECT? 

A. THAT IS CORRECT. THIS IS AN ERIC E-MAIL TO ME.

Q. AND THE TOPIC YOU'RE ADDRESSING IS QCT'S ABILITY TO SHIP 

CHIPSETS TO CUSTOMERS THAT WILL USE THEM IN TD-SCDMA/CSM 

PRODUCTS; RIGHT? 

A. THAT IS CORRECT. IT'S ADDRESSING QCT WOULD LIKE TO ENGAGE 

IN BUSINESS WITH THOSE CUSTOMERS. 

MR. MATHESON: YOUR HONOR, I MOVE TO ADMIT CX 5053. 

MS. SESSIONS: NO OBJECTION. 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

511

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 5053 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. MATHESON: 

Q. NOW, ARABIC NUMERAL 3 READS, "IF ANY OF THESE CUSTOMERS 

REFUSES OR FAILS TO PAY ROYALTIES ON ANY OTHER (I.E., C2K, 

UMTS, LTE) DEVICE, WE WILL DISCONTINUE SUPPLY TO SUCH CUSTOMERS 

IF NECESSARY." 

RIGHT?

A. YES, THAT'S WHAT IT'S SAYING.

Q. NOW, "ANY OTHER DEVICES" MEANS DEVICES OTHER THAN 

TD-SCDMA/GSM; RIGHT? 

A. YES, I'M ASSUMING THAT'S WHAT HE WAS REFERRING TO.

Q. AND TURN YOUR ATTENTION, SIR, TO TAB 14 IN YOUR BINDER, 

WHICH IS CX 7024. 

A. READY.

Q. CAN YOU IDENTIFY THESE AS HANDWRITTEN NOTES THAT YOU 

YOURSELF CREATED? 

A. YES. 

MR. MATHESON: YOUR HONOR, MOVE TO ADMIT CX 7024. 

MS. SESSIONS: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 7024 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

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AMON DIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

512

BY MR. MATHESON: 

Q. TURN YOUR ATTENTION ABOUT HALFWAY DOWN THE DOCUMENT, 

THERE'S A DATE, 12-9-15, RICK AND TEAM, DASH MOTOROLA. DO YOU 

SEE THAT? 

A. YES, I DO.

Q. RICH THERE REFERRED TO RICK OSTERLOH, THE PRESIDENT OF 

MOTOROLA. I BELIEVE IT'S O-S-T-E-R-L-O-H. 

HE WAS THE PRESIDENT OF MOTOROLA; CORRECT? 

A. YES.

Q. AND THIS REFLECTS NOTES YOU TOOK IN CONNECTION WITH THE 

MEETING WITH MR. OSTERLOH; IS THAT RIGHT? 

A. THAT IS CORRECT. 

Q. THE FIRST BULLET READS, "ONE LICENSE. ERIC CONSTANTLY 

THREATENING TO CUT OFF SUPPLY." 

DO YOU SEE THAT, SIR? 

A. YES, I DO.

Q. ERIC THERE REFERS TO MR. ERIC REIFSCHNEIDER; RIGHT? 

A. I BELIEVE SO. 

MR. MATHESON: NO FURTHER QUESTIONS AT THIS TIME. 

THE COURT: ALL RIGHT. TIME IS 1:25. 

(PAUSE IN PROCEEDINGS.) 

THE COURT: THANK YOU. ARE YOU READY? 

MS. SESSIONS: I AM, YOUR HONOR. 

THE COURT: ALL RIGHT. GO AHEAD, PLEASE. 1:26. 

MS. SESSIONS: THANK YOU, YOUR HONOR. 

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AMON CROSS BY MS. SESSIONS

UNITED STATES COURT REPORTERS

513

JUSTINA SESSIONS FOR QUALCOMM. 

CROSS-EXAMINATION

BY MS. SESSIONS: 

Q. GOOD AFTERNOON, MR. AMON. 

A. GOOD AFTERNOON.

Q. MR. AMON, WHERE ARE YOU FROM? 

A. I'M FROM BRAZIL. 

Q. WHAT'S YOUR EDUCATIONAL BACKGROUND? 

A. I'M AN ELECTRICAL ENGINEER. 

Q. WHERE DID YOU RECEIVE YOUR ENGINEERING DEGREE? 

A. I WENT TO UNIVERSITY IN BRAZIL. 

Q. HOW DID YOU COME TO THE U.S.? 

A. I WAS HIRED BY QUALCOMM.

Q. APPROXIMATELY WHEN WERE YOU HIRED BY QUALCOMM?

A. I WAS HIRED BY QUALCOMM IN AUGUST 1995.

Q. AND WHEN DID YOU COME TO THE UNITED STATES? 

A. I CAME TO THE UNITED STATES IN THE LATE PART OF 2006. 

Q. COULD YOU BRIEFLY TAKE THE COURT THROUGH THE JOBS THAT 

YOU'VE HAD AT QUALCOMM? 

A. YES. I STARTED QUALCOMM AS AN ENGINEER. THAT WAS PRIOR 

TO THE FIRST CDMA TECHNOLOGY LAUNCH. 

I HAD A NUMBER OF POSITIONS. I WORKED MY WAY UP TO END UP 

BECOMING RESPONSIBLE FOR ALL THE PRODUCT PLANNING OF THE CHIP 

DIVISION. THEN LATER BECAME CO-PRESIDENT OF THE CHIP DIVISION. 

I BECAME PRESIDENT OF THE CHIP DIVISION, THAT IS, QCT, AND 

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AMON CROSS BY MS. SESSIONS

UNITED STATES COURT REPORTERS

514

IN THE BEGINNING OF 2008, I BECAME THE PRESIDENT OF THE 

COMPANY. 

Q. MR. AMON, HAVE YOU EVER HAD ANY RESPONSIBILITY FOR 

QUALCOMM'S LICENSING BUSINESS? 

A. NO.

Q. EVEN AS THE PRESIDENT OF THE COMPANY? 

A. NO. THE LICENSING BUSINESS, WHEN I CAME PRESIDENT OF THE 

COMPANY, THE GM IS ALEX ROGERS, HE DOES NOT REPORT TO ME. 

Q. MR. AMON, WHAT IS QCT'S RELATIONSHIP WITH ITS MODEM 

CUSTOMERS? 

A. IT'S, IT'S A PARTNERSHIP. WE HAVE A UNIQUE PRODUCT 

SOLUTION. WE'VE BEEN VERY FOCUSSED IN BRINGING CHIPS THAT HAVE 

ADVANCED TECHNOLOGIES, IN MANY CASES NEW TECHNOLOGIES. AND IT 

TAKES ABOUT TWO TO THREE YEARS FROM THE BEGINNING OF THE DESIGN 

OF A PRODUCT TO COMMERCIALIZATION OF A PHONE. THE RELATIONSHIP 

INCLUDES ENGAGEMENT AT MULTIPLE ENGINEERING LEVELS THROUGH THE 

DEVELOPMENT OF THE CHIP, DEVELOPMENT OF THE PHONE. 

AND THEN WHEN THE PHONE IS DEVELOPED TO WORKING WITH THE 

WIRELESS CARRIERS TO GET THE TECHNOLOGY TESTED IN THE FIELD AND 

COMMERCIALIZED. 

AND IT IS A RELATIONSHIP THAT REPEATS ITSELF. WE HAVE TO 

WIN OUR BUSINESS EVERY YEAR AS THE SMARTPHONE TECHNOLOGY, 

ESPECIALLY IN ADVANCED PRODUCTS, YOU HAVE A NEW FLAGSHIP LAUNCH 

EVERY YEAR.

Q. AND YOU MENTIONED THE CARRIERS. WHAT IS QCT'S 

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UNITED STATES COURT REPORTERS

515

RELATIONSHIP WITH WIRELESS CARRIERS? 

A. I WOULD DESCRIBE IT AS A TECHNOLOGY ADVISER. I THINK 

THERE'S A ROLE THAT QUALCOMM HAS AS BEING THE LEADER OR THE 

FIRST TO MARKET IN MANY OF THE WIRELESS STANDARDS. 

SO IT HAS BEEN AN ADVISORY ROLE AS YOU PLAN, YOU KNOW, THE 

MODEM TECHNOLOGY. 

AND THEN IT EVOLVES INTO COMMERCIALIZING THE TECHNOLOGY 

ACROSS THEIR NETWORKS AND THE CHIPSET, AND THEN LATER BRINGING 

THE SMARTPHONE AND THE PHONE PRODUCTS TO THE MARKET. 

Q. WOULD CUTTING OFF A CUSTOMER'S CHIP SUPPLY AFFECT QCT'S 

RELATIONSHIP WITH ITS CUSTOMERS? 

A. YES. IT WOULD BE DEVASTATING TO OUR RELATIONSHIP WITH THE 

CUSTOMER.

Q. HOW SO? 

A. IF WE HAVE THAT LONG RELATIONSHIP WITH A CUSTOMER AND WE 

STOP SHIPPING OF CHIPSETS IN THE PRODUCTION OF A PHONE, THAT -- 

IT WILL SIGNIFICANTLY IMPACT THAT RELATIONSHIP AND OUR STANDING 

AS A SUPPLIER, RELIABLE SUPPLIER, ESPECIALLY AS WE ARE IN THE 

CHIP BUSINESS FOR THE LONG TERM AND WE HAVE TO WIN THAT 

CUSTOMER EVERY SINGLE PHONE. 

Q. WOULD CUTTING OFF A CUSTOMER'S CHIP SUPPLY AFFECT QCT'S 

RELATIONSHIP WITH WIRELESS CARRIERS? 

A. ABSOLUTELY. 

Q. HOW SO? 

A. IF A WIRELESS CARRIER IS DEPENDING ON A PARTICULAR PHONE 

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AMON CROSS BY MS. SESSIONS

UNITED STATES COURT REPORTERS

516

TO MEET THEIR BUSINESS OBJECTIVES, WHICH IS THE ACTIVATION OF 

NEW SUBSCRIBERS, THAT OEM WILL BE UNABLE TO DELIVER THE PHONE 

TO THE CARRIER. 

Q. HAS QUALCOMM EVER STOPPED SHIPPING MODEM CHIPS TO A 

CUSTOMER BECAUSE OF A LICENSING DISPUTE? 

A. NO, NEVER.

Q. HAS QUALCOMM EVER SLOWED DOWN OR OTHERWISE DISRUPTED CHIP 

SUPPLY TO A CUSTOMER BECAUSE OF AIR LICENSING DISPUTE? 

A. NO. 

Q. WOULD YOU KNOW ABOUT THAT IF IT HAD HAPPENED DURING YOUR 

TIME IN THE CHIP BUSINESS? 

A. ABSOLUTELY. 

Q. HAVE YOU EVER TOLD ANYONE TO STOP SHIPPING CHIPS TO A 

CUSTOMER BECAUSE OF A LICENSING DISPUTE? 

A. NO. 

Q. HAS ANYONE EVER TOLD YOU TO STOP SHIPPING CHIPS TO A 

CUSTOMER BECAUSE OF A LICENSING DISPUTE? 

A. NO.

Q. SLIGHTLY DIFFERENT QUESTION. HAS QUALCOMM EVER STOPPED 

SHIPPING CHIPS TO A CUSTOMER DURING LICENSING NEGOTIATIONS? 

A. NO. 

Q. HAS QUALCOMM SHIPPED CHIPS TO CUSTOMERS WHO AREN'T PAYING 

ROYALTIES THAT ARE OWED UNDER LICENSE AGREEMENTS?

A. YES. 

Q. CAN YOU GIVE ME AN EXAMPLE? 

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AMON CROSS BY MS. SESSIONS

UNITED STATES COURT REPORTERS

517

A. ONE EXAMPLE IS APPLE. 

Q. IS IT -- 

A. APPLE CONTRACT MANUFACTURERS. 

Q. HAS QUALCOMM EVER STOPPED SHIPPING CHIPS TO A CUSTOMER FOR 

ANY REASON? 

A. YES.

Q. WHAT ARE SOME OF THOSE REASONS? 

A. IF THE CUSTOMER DOES NOT PAY FOR THE CHIPSET, THAT'S ONE 

OF THE REASONS. 

ANOTHER REASON IS IF WE HAVE A SUPPLY ISSUE. IF WE DON'T 

HAVE SUPPLY FROM OUR MANUFACTURER PARTNERS TO DELIVER TO THE 

CUSTOMER. 

THERE'S ALSO BEEN SOME RARE OCCASIONS THAT WE MAY HAVE A 

DEFECT AND WE HAVE TO REPLACE THAT PRODUCT INTO A NEW VERSION 

OF A PRODUCT. 

THERE HAS BEEN REASONS TO STOP SHIPMENT FOR COURT ORDER. 

EXAMPLES WOULD BE THE ZTE CASE. 

AND THEN THERE IS THE NORMAL COURSE OF BUSINESS, WHICH IS 

WHEN -- WHAT IS JOINTLY DONE WITH A CUSTOMER WHEN A PRODUCT 

REACHES ITS END OF ITS LIFECYCLE, WHICH IS USUALLY A NUMBER OF 

YEARS AFTER THE PRODUCT HAS BEEN LAUNCHED.

Q. DRAWING YOUR ATTENTION SPECIFICALLY TO LENOVO. HAS QCT 

SHIPPED CHIPS TO LENOVO? 

A. YES. 

Q. WHEN DID QCT START SHIPPING CHIPS TO LENOVO? 

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AMON CROSS BY MS. SESSIONS

UNITED STATES COURT REPORTERS

518

A. I CAN'T PRECISE THE DATE. IT WAS ABOUT THE TIME THAT THE 

CHINA DOMESTIC MARKET MOVED FROM 2G TO 3G.

Q. WAS THAT AROUND 2010? 

A. IT COULD BE. 

Q. WHAT KIND OF CHIPS DID QUALCOMM SHIP TO LENOVO AT THE 

BEGINNING OF ITS RELATIONSHIP TO LENOVO? 

A. IT WAS ENTRY LEVEL CHIPSETS, SOME REGULAR 3G PHONES, LIKE 

FLIP PHONES AND CANDY BAR CHIPSETS FOR THOSE SOLUTIONS, AND 

THEN ENTRY LEVEL SMARTPHONE CHIPS AS WELL.

Q. WHERE WERE THOSE CHIPSETS GOING TO BE USED? 

A. THE MAJORITY, IT WAS FOR PHONES THAT LENOVO WAS SELLING IN 

DOMESTIC CHINA MARKET. 

Q. DID LENOVO BUY CHIPS FROM QUALCOMM IN THE 2013 TO 2014 

TIMEFRAME?

A. I BELIEVE SO.

Q. WHAT TYPES OF CHIPS WAS QUALCOMM SHIPPING TO LENOVO IN 

2013 TO 2014? 

A. THE MAJORITY WAS ENTRY LEVEL AND MID-TIER CHIPS. THERE 

WERE SOME FEW PREMIUM TIER SNAPDRAGON 800, BUT THE MAJORITY 

WERE THE 600, 400, AND 200 SERIES.

Q. IN 2013 TO 2014, WAS ANYONE ELSE SELLING MODEM CHIPS TO 

LENOVO? 

A. YES.

Q. WHO? 

A. THE MAIN SUPPLIER OF LENOVO AT THAT TIME WAS MEDIATEK.

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AMON CROSS BY MS. SESSIONS

UNITED STATES COURT REPORTERS

519

Q. HAS QCT EVER BEEN LENOVO'S PRIMARY MODEM CHIP SUPPLIER? 

A. NO. 

Q. MR. AMON, IF YOU COULD TURN IN YOUR BINDER OF THE FTC'S 

DOCUMENTS TO CX 7024, WHICH IS TAB 14. 

A. READY. 

Q. COUNSEL FOR THE FTC ASKED YOU SOME QUESTIONS ABOUT YOUR 

NOTES AND A MEETING WITH MOTOROLA THAT YOU DESCRIBE. 

WHO WAS AT THAT MEETING? 

A. IT WAS RICK OSTERLOH, THE PRESIDENT OF MOTOROLA, AND HIS 

TEAM, AND I DON'T REMEMBER WHO WERE THE MEMBERS OF HIS TEAM. 

AND THERE WAS ME AND SOME MEMBERS FROM THE QCT TEAM AS WELL, 

WHICH IS QUALCOMM CHIPSET DIVISION.

Q. WAS ERIC REIFSCHNEIDER AT THIS MEETING? 

A. NO, DEFINITELY DON'T RECALL ERIC IN THAT MEETING. 

Q. DO YOU THINK YOU WOULD RECALL IF ERIC HAD BEEN IN THE 

MEETING? 

A. I WOULD BECAUSE MEETING WITH QCT CUSTOMERS ARE NOT, YOU 

KNOW, ATTENDED BY QTL. 

Q. AND COUNSEL FOR THE FTC ASKED YOU ABOUT THE NOTE THAT SAID 

"ERIC CONSTANTLY THREATENING TO CUT OFF SUPPLY." 

WHAT WAS THAT NOTE REFERRING TO? 

A. MY, MY RECOLLECTION IS THAT MOTOROLA WAS REPRESENTING TO 

ME THAT THEY WERE RECEIVING THREATS FROM ERIC TO CUT OFF 

SUPPLY. THAT'S WHAT I WROTE. 

Q. WAS THAT ISSUE A MAJOR PART OF THE DISCUSSION AT THIS 

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AMON CROSS BY MS. SESSIONS

UNITED STATES COURT REPORTERS

520

MEETING? 

A. NO.

Q. DID YOU RESPOND TO RICK? 

A. YES. 

Q. HOW DID YOU RESPOND? 

A. WHAT I BELIEVE FROM MEMORY IS, YOU KNOW, WE BASICALLY 

SAID, IF YOU HAVEN'T HEARD THAT FROM QCT, THAT'S NOT AN ISSUE. 

AND WE MOVED ON TO THE OTHER MATTERS OF THE MEETING.

Q. WOULD ERIC REIFSCHNEIDER HAVE HAD THE ABILITY TO CUT OFF 

CHIP SUPPLY TO MOTOROLA? 

A. HE WILL NOT. 

Q. IN DECEMBER OF 2015, WHO WOULD HAVE HAD THE AUTHORITY TO 

CUT OFF CHIP SUPPLY TO MOTOROLA?

A. IT WOULD HAVE TO BE THE PRESIDENT OF QCT OR THE CEO OF THE 

COMPANY.

Q. AFTER THIS MEETING, DID ANYONE FROM MOTOROLA TELL YOU THAT 

THEY WERE WORRIED ABOUT THEIR CHIP SUPPLY? 

A. IF I -- IF I RECALL CORRECTLY, YOU KNOW, IN THE MEETING, 

THEY WANTED TO UNDERSTAND QCT POSITION, AND WE MOVE ON TO OTHER 

MATTERS. AND AFTER THE MEETING, I DON'T BELIEVE THIS ISSUE 

CAME BACK AGAIN TO THE BEST OF MY RECOLLECTION.

Q. WHAT HAS QCT'S RELATIONSHIP WITH MOTOROLA BEEN SINCE THE 

END OF 2015? 

A. IT -- THE RELATIONSHIP IMPROVED WITH MOTOROLA/LENOVO, 

WHICH IS MOTOROLA HAS BEEN ACQUIRED BY LENOVO. IT HAD EXPANDED 

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AMON CROSS BY MS. SESSIONS

UNITED STATES COURT REPORTERS

521

FROM ITS ORIGINAL RELATIONSHIP. 

Q. MR. AMON, DRAWING YOUR ATTENTION TO HUAWEI, DOES QCT SELL 

MODEM CHIPS TO HUAWEI? 

A. YES, WE DO. 

Q. AS OF MARCH OF 2018, WAS HUAWEI BUYING PREMIUM TIER CHIPS 

FROM QCT? 

A. BEFORE MARCH 2018?

Q. AS OF MARCH -- IN MARCH 2018. 

A. I DON'T BELIEVE SO. 

Q. HAS QUALCOMM EVER STOPPED SHIPPING CHIPS TO HUAWEI? 

A. NO. 

Q. HAS ANYONE FROM HUAWEI TOLD YOU THAT THEY'RE WORRIED ABOUT 

QUALCOMM CHIP SUPPLY?

A. NO. 

Q. MR. AMON, HAS QUALCOMM SHIPPED CHIPS TO SONY MOBILE? 

A. YES.

Q. TO YOUR KNOWLEDGE HAS QUALCOMM EVER CUT OFF SONY MOBILE'S 

CHIP SUPPLY? 

A. NO. 

Q. ARE YOU AWARE THAT QUALCOMM AND SONY HAD A LICENSING 

DISPUTE AT ONE POINT? 

A. I WAS AWARE THERE WAS A LICENSING NEGOTIATION WHEN SONY 

ACQUIRED THE BUSINESS -- THE PORTION OF ERICSSON AND THEIR 

BUSINESS. 

Q. DID ANYONE EVER INSTRUCT YOU TO WITHHOLD CHIP SHIPMENTS TO 

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AMON CROSS BY MS. SESSIONS

UNITED STATES COURT REPORTERS

522

SONY DURING THAT NEGOTIATION? 

A. NO. 

Q. MR. AMON, ARE YOU GENERALLY FAMILIAR WITH THE COMPETITION 

THAT QUALCOMM'S CHIP BUSINESS FACES? 

A. YES. 

Q. AND WHAT'S THE BASIS FOR YOUR KNOWLEDGE OF THAT? 

A. IT COMES FROM COMPETITOR'S ANNOUNCEMENTS, IT COMES FROM 

WHAT OUR CUSTOMERS REPRESENT THE COMPETITIVE LANDSCAPE IS, IT 

COMES FROM WHAT WE SEE IN THE MARKETPLACE.

Q. TURNING TO CDMA CHIPS, HAS QUALCOMM FACED COMPETITION IN 

CDMA CAPABLE CHIPS? 

A. YES.

Q. WHAT WERE SOME OF QUALCOMM'S EARLY COMPETITORS IN CDMA 

CHIPS? 

A. EARLY COMPETITOR, MOTOROLA HAD THEIR OWN CHIP, THEY WERE A 

VERTICAL PLAYER; NOKIA LICENSE AGREEMENT HAD THEIR OWN CHIP, 

THEY WERE ALSO A VERTICAL PLAYER; I BELIEVE THERE'S A PORTION 

OF SAMSUNG THAT SAMSUNG ALSO HAD THEIR OWN CHIP; AND VIA WAS 

ALSO A COMPETITOR IN THE EARLY DAYS. 

Q. IN THE EARLY DAYS, HOW DID QUALCOMM'S CDMA CHIPS COMPARE 

TO VIA'S CHIPS?

A. IT WAS VERY DIFFERENT.

Q. HOW WERE THEY DIFFERENT? 

A. IN ADDITION OF THE COMPANY FOCUS ON THE SEMICONDUCTOR SIDE 

ON THE WIRELESS TECHNOLOGY, THEY WOULD ALSO HAVE BEEN AN 

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UNITED STATES COURT REPORTERS

523

INNOVATOR ON THE CHIP SIDE. SO WE WERE THE FIRST TO CREATE THE 

CONCEPT OF A SINGLE CHIP FOR FEATURE PHONES THAT INCORPORATED 

MULTIMEDIA CAPABILITIES, PLUS THE MODEM INTO A SINGLE CHIP. 

AND THAT IS DIFFERENT THAN THE VIA PRODUCT AT THAT TIME. 

Q. YOU MENTIONED FEATURE PHONES. WHAT'S A FEATURE PHONE? 

A. I'M SORRY. A FEATURE PHONE WAS BEFORE SMARTPHONES, THE 

FLIP PHONES OR THE CANDY BAR PHONES THAT ALSO HAD MULTIMEDIA 

CAPABILITIES. 

Q. IS VIA STILL A COMPETITOR IN CDMA CHIPS? 

A. I DON'T KNOW HOW THEIR BUSINESS HAD EVOLVED OR HAD THEY 

BEEN ACQUIRED. I KNOW THE CDMA COMPETITORS TODAY ARE MEDIATEK, 

SAMSUNG, HISILICON ARE EXAMPLES. AND MAYBE SPREADTRUM, BUT I 

DON'T KNOW FOR SURE. 

AND ONE MORE, INTEL. I FORGET INTEL AS WELL. 

Q. HAS QUALCOMM ENJOYED A LARGE SHARE OF CDMA CHIP SALES OVER 

THE YEARS?

A. YES, WE DID. 

Q. TO WHAT DO YOU ATTRIBUTE THAT? 

A. IN, IN PART IS, AS CDMA BECOME A SMALLER MARKET AND AS 

GSM, WHICH IS THE LARGEST BASE OF PHONES EVOLVED TO WCDMA, CDMA 

BECAME A SMALLER MARKET, BUT WE CONTINUED TO INVEST IN CDMA. 

THAT'S ONE OF THE REASONS. SO WE HAD MORE ADVANCED CHIPS 

AND WERE WILLING TO INVEST R&D DOLLARS FOR A SMALLER MARKET 

WHERE MANY OF OUR COMPETITORS WERE INVESTING FOR A LARGER 

MARKET. THAT'S ONE REASON. 

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AMON CROSS BY MS. SESSIONS

UNITED STATES COURT REPORTERS

524

THE OTHER REASON IS THAT WE CHOSE TO DEVELOP A MULTIMODE 

PLATFORM. SO ALL OF OUR CHIPS END UP BECOMING ONE INTEGRATED 

CHIP THAT HAD CDMA PLUS UMTS PLUS EVERY OTHER CELLULAR MODE, 

AND IT BECAME DIFFERENTIATED AS THE CDMA OPERATORS, WE PREFER A 

MULTIMODE SOLUTION SO THAT THEIR SUBSCRIBERS COULD HAVE GLOBAL 

ROAMING WHEN THEY WOULD TRAVEL TO A MARKET THAT THERE'S NO 

CDMA, THEY WILL BE ABLE TO USE THE UMTS CAPABILITIES OF THAT 

CHIP.

Q. AND YOU MENTIONED UMTS A FEW TIMES. WHAT IS UMTS? 

A. OH, I'M SORRY. UMTS OR WCDMA ARE THE SAME THING.

Q. AND WHAT ARE UMTS AND WCDMA? 

A. IT'S THE 3G STANDARD THAT EVOLVED FROM GSM. 

Q. WHY DID QUALCOMM KEEP INVESTING IN CDMA? 

A. CDMA IS A TECHNOLOGY THAT WAS INVENTED BY QUALCOMM, AND WE 

FELT THAT WE WANTED TO KEEP THE CDMA OPERATORS COMPETITIVE, AND 

WE WANTED TO MAINTAIN THAT ECOSYSTEM, COMPETITIVENESS, AND THAT 

ECOSYSTEM TO GROW. THAT'S WHY WE INVESTED IN CDMA EVEN BEFORE 

WE INVESTED IN 3G WCDMA. 

Q. IN THE PAST FEW YEARS, WHAT HAS HAPPENED TO QUALCOMM'S 

SHARE OF CDMA SALES? 

A. WE HAD GRADUALLY LOST SHARE AS MANY OF THE -- AS THE 

INDUSTRY MOVED FROM 3G TO 4G, CDMA BECAME MORE OF AN OBSOLETE 

TECHNOLOGY. IT WAS NO LONGER REQUIRED BY A NUMBER OF 

OPERATORS, VERIZON IS AN EXAMPLE. 

AND I THINK OUR SHARE HAS, HAS DECLINED. IT'S STILL HIGH, 

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BUT IT HAS DECLINED. 

Q. MR. AMON, DOES QUALCOMM PRICE ITS CDMA CAPABLE CHIPS 

DIFFERENTLY FROM ITS UMTS OR WCDMA CAPABLE CHIPS? 

A. YES, WE DO.

Q. WHY IS THAT? 

A. AS I JUST EXPLAINED EARLIER, THE QUALCOMM CHIPSET 

SOLUTION, IT IS -- IT'S A MULTI MODE CHIPSET. SO IF YOU THINK 

OF A 3G PLUS 4G CHIPSET, THE CHIPSET HAS LTE, CDMA, WCDMA. 

IF YOU ARE A UMTS MARKET OR OPERATOR, YOU BUY JUST THE 

FUNCTIONALITY OF LTE PLUS UMTS IN THE CHIP. 

IF YOU ARE A CDMA OPERATOR, THAT CDMA GET ADDED TO THE 

CAPABILITY CHIP. IT'S ACTIVE. YOU HAVE THE SUPER SET. SO 

THERE IS A PRICE THAT THEY PAY TO ACTIVATE THE CDMA 

FUNCTIONALITY.

Q. MR. AMON, COULD YOU TURN TO TAB 1 OF THE -- YOUR BINDER OF 

THE FTC'S DOCUMENTS, WHICH IS EXHIBIT CX 5279. 

A. TAB 1?

Q. TAB NUMBER 1, YES. 

A. READY. 

Q. MR. AMON, TURNING TO PAGE 3 OF THE EXHIBIT, YOU HAD 

DISCUSSED WITH COUNSEL FOR THE FTC A RECOMMENDATION THAT YOU 

MADE IN THIS E-MAIL. 

A. YES.

Q. COULD YOU PLEASE EXPLAIN THE RECOMMENDATION THAT YOU WERE 

MAKING? 

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A. YES. THIS WAS AT A TIME THAT CDMA WAS STOPPED GROWING AND 

THE LARGEST OPPORTUNITY WAS UMTS. UMTS HAS A LOT MORE SCALE. 

UMTS, OR WCDMA, HAS A LOT MORE SCALE. 

SO I WAS RECOMMENDING, EVEN THOUGH FOR QUALCOMM IT WILL 

HAVE A SMALLER RETURN ON INVESTMENT, TO INVEST ON CDMA 

TECHNOLOGY. I WAS RECOMMENDING THAT WE KEEP CDMA AND UMTS AS 

EQUIVALENT OR SIMILAR PRICES BECAUSE I WOULD LIKE CDMA TO HAVE 

THE -- CDMA OPERATORS TO HAVE THE ABILITY TO HAVE DEVICES FOR 

THEIR SUBSCRIBERS AT PRICES THAT WERE SOMEWHAT CONSISTENT WITH 

THE LARGER UMTS SCALE. 

Q. AND WHAT DID YOU MEAN WHEN YOU WROTE "QUALCOMM WILL NOT 

EXERCISE ITS CDMA MARKET SHARE DOMINANCE TO PRACTICE 

UNCOMPETITIVE PRICES"? 

A. IT MEANT THAT WE HAVE VERY HIGH SHARE AT THAT TIME AND 

WE'RE PREPARED TO CONTINUE INVESTING IN NEW CHIPSETS TO KEEP 

THE CDMA TECHNOLOGY, YOU KNOW, UP-TO-DATE. 

AND IF WE BECOME THE ONLY PROVIDER OF CDMA, WE COULD NOT 

HAVE CDMA AT UNCOMPETITIVE PRICES BECAUSE I WAS TRYING TO 

MAINTAIN THE CDMA ECOSYSTEM AT PAR WITH UMTS. THAT WAS THE 

RECOMMENDATION.

Q. SO WHEN YOU'RE REFERRING TO UNCOMPETITIVE PRICES, 

UNCOMPETITIVE RELATIVE TO WHAT? 

A. UNCOMPETITIVE RELATIVE TO UMTS EQUIVALENT PHONES. 

Q. DO UMTS PRICES INFLUENCE CDMA PRICES? 

A. THEY DO. 

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Q. MR. AMON, AT THE BOTTOM OF PAGE 3 OF THIS EXHIBIT YOU MADE 

THE STATEMENT, "THERE IS NO JUSTIFICATION FOR THE 10 PERCENT." 

DO YOU SEE THAT? 

A. YES, I DO.

Q. WHAT DID YOU MEAN BY THAT? 

A. IT MEANS IF I HAD TO LOOK ON THE ROI, RETURN ON 

INVESTMENT, WE PROBABLY HAVE -- WHAT I WANTED TO DO, IT 

PROBABLY HAS TO BE HIGHER THAN 10 PERCENT. 

I WANT TO TAKE A MOMENT TO EXPLAIN. BY ENABLING A 

MULTIMODE PLATFORM FOR EVERY SINGLE UMTS CHIP THAT WE WILL SELL 

TO NON-CDMA OPERATORS, THE CDMA FUNCTIONALITY WILL BE THERE AND 

WE'LL BE PAYING FOR THE COST OF THE SILICON. 

AND IF I WERE TO HAVE THE RETURN ON THAT INVESTMENT, WE'D 

HAVE TO CHARGE MORE. 

BUT I WANTED TO KEEP AS LOW AS POSSIBLE WITHIN THE LEVEL 

OF TOLERANCE OF AN OEM SO THAT HE COULD STILL OFFER THE PHONE, 

ALBEIT AT A SMALLER SCALE, AT SIMILAR PRICES AS THE UMTS PHONE. 

Q. MR. AMON, IF YOU COULD TURN TO TAB 15 OF YOUR BINDER OF 

THE FTC'S DOCUMENTS. 

A. READY. 

Q. YOU DISCUSSED WITH COUNSEL FOR THE FTC SOME STATEMENTS IN 

THIS DOCUMENT, AND I'D LIKE TO DRAW YOUR ATTENTION TO THE 

BULLET POINT IN THE JUNE 17TH, 2013, E-MAIL THAT YOU WROTE, THE 

THIRD -- OR SECOND BULLET POINT THAT SAYS, "OUR PRICE IS NOT 

BASED ON COST BUT ON VALUE." 

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DO YOU SEE THAT? 

A. YES, I DO.

Q. WHAT DID YOU MEAN WHEN YOU SAID "PRICE IS NOT BASED ON 

COST BUT ON VALUE"? 

A. IT MEANS THERE'S A VARIABLE COST ON THE CHIP AND THE 

VARIABLE COST ON THE CHIP, THIS IS WHAT I WAS REFERRING TO 

HERE, AND I WAS SAYING THAT OUR PRICE IS BASED ON THE VALUE 

THAT THE CHIP OFFER, NOT NECESSARILY THE SILICON COST. 

Q. WHY DOESN'T QUALCOMM PRICE BASED ON THE SILICON COST? 

A. IN GENERAL, WE ARE -- WE DON'T BELIEVE TO BE A COMMODITY 

PROVIDER OF CHIPSETS. SO WE DESIGN OUR CHIPSETS WITH ADVANCED 

AND NEW FUNCTIONALITY AND WE PRICE THEM TO MARKET. 

SO IN GENERAL, I THINK THAT'S THE ANSWER. 

SPECIFICALLY IN THIS CASE, IT WAS RELATED TO THE MARKET ON 

CDMA AND THEN THE OTHER IMPLICATIONS THAT ARE OUTLINED ABOUT 

THE MULTIMODE STRATEGY. 

Q. MR. AMON, COULD YOU TURN TO TAB 2 OF YOUR BINDER, WHICH IS 

CX 6839. 

A. I'M READY. 

Q. TURNING TO PAGE 2 OF THE DOCUMENT, WHICH CONTAINS 

MR. KOLIANDER'S E-MAIL TO YOU AND SOME OTHERS, WHAT WAS 

MR. KOLIANDER CONVEYING IN HIS E-MAIL TO YOU? 

A. ON THE TOP OF PAGE 2?

Q. IN THE CENTER OF PAGE 2, YES. 

A. HE'S CONVEYING THE REQUIREMENTS FROM APPLE, IN THIS CASE 

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MAVERICK IS USED TO REPRESENT APPLE -- THEIR REQUIREMENTS FOR A 

CDMA CHIPSET THEY WERE INTERESTED, AND AS A RESULT OF A 

CONFERENCE CALL HE HAD WITH APPLE ENGINEERING TEAM. 

Q. AND WHEN COUNSEL FOR THE FTC ASKED YOU ABOUT THIS 

DOCUMENT, I BELIEVE THAT YOU SAID THAT YOU DID NOT BELIEVE THAT 

ANOTHER SUPPLIER COULD MEET APPLE'S CHIPSET REQUIREMENTS. IS 

THAT RIGHT? 

A. THAT IS CORRECT.

Q. AND WHAT -- WHAT DO YOU MEAN BY APPLE'S CHIPSET 

REQUIREMENTS? 

A. THERE ARE TWO SPECIFIC REQUIREMENTS. ONE IS THEY WANTED 

THE CHIPSET TO FIT INTO LESS THAN 855 SQUARE MILLIMETERS IN 

THEIR PRINTED CIRCUIT BOARD AREA. SO THE AREA INTO THE PHONE. 

THE OTHER ONE IS THE SCHEDULE, THEY WOULD LIKE THAT CHIP 

TO BE AVAILABLE TO THEM. I DID NOT BELIEVE THE COMPETITION 

COULD MEET THOSE TWO REQUIREMENTS.

Q. WERE THERE OTHER CDMA CAPABLE CHIPSETS AVAILABLE AT THE 

TIME?

A. YES. 

Q. SO WHY COULD THOSE OTHER CDMA CAPABLE CHIPSETS NOT MEET 

APPLE'S REQUIREMENT? 

A. THEY COULD NOT FIT INTO THE AREA THAT APPLE DECIDED THEY 

WANTED THE CHIPSET TO FIT BASED ON THE DESIGN, THE I.D. OF THE 

APPLE PHONE. 

Q. MR. AMON, HAS QUALCOMM SOLD WCDMA OR UMTS CAPABLE 

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CHIPSETS? 

A. YES.

Q. WHEN DID QUALCOMM FIRST START SELLING THOSE CHIPSETS? 

A. IN THE TRANSITION OF GSM TO WCDMA, WE WERE LATE TO DECIDE 

TO DEVELOP THOSE CHIPSETS WHEN THE STANDARD WAS DONE. I WOULD 

SAY PROBABLY BEHIND A LOT OF THE GSM INCUMBENTS. 

BUT AS THE WCDMA GOT COMMERCIALIZED, WE WERE THE FIRST TO 

DELIVER THE CHIPSETS. I CAN'T PRECISE THE DAYS. I WOULD SAY 

CIRCA, YOU KNOW, 1999, 2000. BUT I CAN'T REALLY PRECISE. 

Q. HAS QUALCOMM ALSO SOLD LTE CAPABLE CHIPSETS?

A. YES. 

Q. WHEN DID QUALCOMM START SELLING LTE CAPABLE CHIPSETS? 

A. AGAIN, I CAN'T HAVE THE EXACT DATE FROM MEMORY. I'LL SAY 

AROUND THE YEAR 2009, 2010 TIMEFRAME. THAT'S WHERE LTE 

STARTED.

Q. HAS QUALCOMM EVER SOLD SINGLE MODE LTE CHIPS FOR USE IN 

CELL PHONES? 

A. WE -- NOT FOR CELL PHONES, NO, I DON'T THINK SO.

Q. WHAT'S A SINGLE MODE LTE CHIP? 

A. A SINGLE MODE LTE CHIP, THAT ONLY THE LTE FUNCTIONALITY IS 

ENABLED. IT DOES NOT HAVE ANY 3 -- 3G FUNCTIONALITY. BY 3G I 

MEAN CDMA OR WCDMA OR TD-SCDMA. THOSE ARE THE DIFFERENT 

VARIANTS. ONLY 4G LTE IS ENABLED.

Q. HAS QUALCOMM ENJOYED A LARGE PORTION OF LTE CHIP SALES 

OVER THE YEARS? 

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A. YES, WE DID.

Q. AND WHY DO YOU BELIEVE THAT TO BE THE CASE?

A. BECAUSE WE'RE FIRST TO MARKET WITH LTE, AND THEN 

SUBSEQUENTLY FIRST TO MARKET WITH EVERY NEW GENERATION OF LTE. 

Q. WHY HAS QUALCOMM BEEN ABLE TO BE FIRST TO MARKET? 

A. ONE OF THEIR CORE COMPETENCES OF THE QUALCOMM CHIPSET 

BUSINESS IS TO BE, YOU KNOW, A WIRELESS SYSTEM COMPANY. I 

WOULD SAY QUALCOMM IS PROBABLY MORE OF A CREATOR OF CELLULAR 

STANDARDS THAN AN IMPLEMENTER OF STANDARDS AND BECAUSE OF THAT 

WE STARTED DEVELOPMENT EARLY. 

THE OTHER REASON IS WE, WE HAVE A SIGNIFICANT R&D BUDGET 

DEDICATED TO WIRELESS TECHNOLOGY INVESTMENTS. 

Q. AS THE LTE STANDARD HAS MATURED, HAS QUALCOMM'S TIME TO 

MARKET ADVANTAGE DIMINISHED? 

A. YES, IT DID. 

Q. WHO IS CATCHING UP IN LTE? 

A. TODAY WE HAVE A NUMBER OF COMPETITORS. EXAMPLES ARE 

INTEL, MEDIATEK, SAMSUNG'S OWN CHIPSET DIVISION, WHICH IS 

CALLED EXYNOS, HUAWEI HISILICON, AND YOU HAVE ALSO THE CHINESE 

SPECTRUM. THIS IS SOME OF THE EXISTING LIST. 

IT'S NOT -- IT'S NOT EXHAUSTIVE. THERE ARE OTHER 

COMPANIES AS WELL. 

Q. DID QUALCOMM LTE CHIPS HAVE FEATURES THAT DIFFERENTIATE 

QUALCOMM CHIPS FROM ITS COMPETITORS? 

A. YES. 

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Q. COULD YOU GIVE SOME EXAMPLES? 

A. ALL OF THE NEW -- OFTEN ALL OF THE NEW MODEM FEATURES ON A 

PARTICULAR LTE 4G STANDARD GET COMMERCIALIZED AS PART OF OUR 

SNAPDRAGON 800 PREMIUM TIER CHIPSET. 

AND THE FEATURES ARE NOT ONLY UNIQUE TO LTE. THE FEATURES 

THAT DIFFERENTIATE THE CHIPSET IS PROBABLY THE, THE MOST 

ADVANCED TRANSISTOR IN THE INDUSTRY, PROCESSOR FOR ARTIFICIAL 

INTELLIGENCE MACHINE LEARNING, GRAPHICAL PROCESSORS, WI-FI 

RADIOS, USUALLY WE ALSO HAVE THE LATEST STANDARDS ON WI-FI. 

AND SO THE QUALCOMM PRODUCT IS WHAT WE CALL A SYSTEM ON A CHIP 

THAT HAS A NUMBER OF DIFFERENTIATED FEATURES THAT MAKES A 

SMARTPHONE WORK BEYOND LTE. 

Q. COULD YOU EXPLAIN A LITTLE BIT MORE WHAT YOU MEAN BY A 

SYSTEM ON A CHIP? 

A. A SYSTEM ON A CHIP MEANS, YOU KNOW, EVERY SINGLE 

FUNCTIONALITY THAT YOU NEED ON YOUR PHONE, WHETHER IT'S VIDEO 

PLAYER, THE MUSIC PLAYER, THE GRAPHICS PROCESSOR FOR GAMES, THE 

CPU TO RUN YOUR OPERATIONAL SYSTEMS, THE DIGITAL SIGNAL 

PROCESSORS FOR ALL OF THE MULTIMEDIA. 

THOSE ARE SOME EXAMPLES. THEY'RE ALL INCLUDED INTO A 

SINGLE CHIP. IN MANY CASES THE SMARTPHONE, ALL OF THE 

PROCESSOR IN THE QUALCOMM ARCHITECTURE IS DONE BY THE SINGLE 

CHIP, INCLUDING THE CELLULAR MODEM.

Q. MR. AMON, TURNING YOUR ATTENTION TO 5G. HAS QUALCOMM BEEN 

WORKING ON CHIPS THAT WILL WORK ON THE 5G STANDARD? 

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A. YES, WE ARE. 

MR. MATHESON: OBJECTION, YOUR HONOR. WE HAVE NO 

OBJECTION TO ELICITING THIS SYSTEM, AS LONG AS WE'RE NOT 

OPENING THE DOOR TO TESTIMONY ABOUT CURRENT EVENTS IN VIOLATION 

OF THE COURT'S ORDER. 

MS. SESSIONS: I'M GOING TO LIMIT MY NEXT QUESTION TO 

THE TIMEFRAME BEFORE MARCH OF 2018. 

MR. MATHESON: OKAY. 

BY MS. SESSIONS: 

Q. MR. AMON, AS OF EARLY 2018, WHAT DID QUALCOMM EXPECT 

COMPETITION IN 5G CHIPS TO LOOK LIKE? 

A. WE EXPECT TODAY, BASED ON A NUMBER OF PRODUCT 

ANNOUNCEMENTS -- 

Q. MR. AMON, I'M SORRY. I'M GOING TO INTERRUPT YOU. 

MY QUESTION WAS ABOUT EARLY 2018 AND NOT TODAY. 

A. I'M SORRY. EARLY 2018. 

Q. WHAT WAS QUALCOMM'S VIEW OF EXPECTED COMPETITION IN 5G? 

A. YEAH. AT THAT TIME, FOLLOWING THE ACTIVITY WE'VE SEEN IN 

THE STANDARDS WHICH ACTUALLY GOT COMPLETED BY DECEMBER OF 2017, 

THAT'S WHERE THE 5G STANDARD GOT COMPLETED, BASED ON THE 

ACTIVITY WE SAW IN SUBSEQUENT, YOU KNOW, ANNOUNCEMENT, WE 

EXPECT ALL OF OUR MAIN LTE COMPETITORS TO BE WORKING ON A 5G 

PLAN. THAT INCLUDES INTEL, SAMSUNG EXYNOS, HUAWEI, HISILICON, 

AS WELL AS MEDIATEK. 

Q. MR. AMON, HAS QUALCOMM EVER SUPPLIED MODEM CHIPS TO APPLE? 

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A. YES. 

Q. WHAT KIND OF MODEM CHIPS HAS QUALCOMM -- 

A. ONE CORRECTION. WE DO NOT HAVE THE DIRECT SUPPLY 

RELATIONSHIP WITH APPLE. SO WE SUPPLY TO APPLE'S CONTRACT 

MANUFACTURERS. 

Q. THANK YOU. 

WHAT KIND OF CHIPS HAS QUALCOMM SUPPLIED TO APPLE'S 

CONTRACT MANUFACTURERS. 

A. THE CHIPSET IS CALLED MDM, AND IT IS A MULTIMODE -- IT'S A 

MULTIMODE CELLULAR MODEM CHIP.

Q. WHAT DOES MDM STAND FOR? 

A. IT'S MOBILE DATA MODEM. 

Q. IS AN MDM DIFFERENT FROM A SYSTEM ON A CHIP? 

A. I'M -- I'M SORRY. MOBILE DEVICE MODEM. MY APOLOGIES. 

IT IS VERY DIFFERENT THAN A SYSTEM ON A CHIP. 

Q. HOW SO? 

A. IT ONLY CONTAINS THE CELLULAR MODEM CAPABILITIES. IN SOME 

CASES IT MAY CONTAIN ALSO THE GPS CAPABILITIES. 

IT DOES NOT CONTAIN ANY OF THE APPLICATION PROCESSORS IN 

MULTIMEDIA CAPABILITIES OF THE SOC. 

Q. HAS QUALCOMM SUPPLIED CHIPS FOR THE NEWEST IPHONE 

PRODUCTS? 

A. THE IPHONES THEY'RE LAUNCHING NOW? WE DO NOT. 

Q. WHO IS SUPPLYING THE CHIPS FOR THE IPHONES THAT ARE 

LAUNCHING NOW?

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A. INTEL. 

Q. DURING THE TIME THAT QUALCOMM WAS SUPPLYING APPLE'S 

CONTRACT MANUFACTURERS WITH CHIPS FOR USE IN APPLE PHONES, DID 

YOU BELIEVE THAT QUALCOMM HAD TO COMPETE FOR THE APPLE 

BUSINESS? 

A. YES, I DID. 

Q. MR. AMON, IF YOU COULD TURN IN YOUR SECOND BINDER TO THE 

TAB LABELED QX 9225. 

A. I'M READY.

Q. OKAY. MR. AMON, IF YOU COULD TURN TO THE LAST PAGE OF 

QX 9225. DO YOU SEE AN E-MAIL THERE ON THAT PAGE? 

A. YES.

Q. COULD YOU IDENTIFY THAT FOR ME, PLEASE? 

A. IT'S AN E-MAIL I HAVE SENT ON DECEMBER 21ST, 2012, TO A 

NUMBER OF INDIVIDUALS IN QCT. 

Q. AND WHAT IS THIS E-MAIL DESCRIBING? 

A. IT'S DESCRIBING A REPORT OF A MEETING I HAD WITH APPLE. 

HERE MAVERICK IS ALSO BEING USED FOR APPLE. 

AND IN THE MEETING, THEY HAD REPORTED THAT FOR THE PHONE 

LAUNCHING IN 2010 THAT'S DEFINED AS MAV 10, THEY HAD A CLEAR 

ALTERNATIVE USING INFINEON, AND THEY WERE GIVING SOME DETAILS 

ABOUT WHAT THE INFINEON PRODUCT IS. 

MS. SESSIONS: YOUR HONOR, I'D MOVE QX 9225 INTO 

EVIDENCE. 

MR. MATHESON: OBJECTION, YOUR HONOR. THE DOCUMENT 

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CONTAINS HEARSAY. IT'S NOT A BUSINESS RECORD. 

MS. SESSIONS: YOUR HONOR, I THINK THERE WAS A HIGH 

PRIORITY OBJECTION THAT WAS OVERRULED ON THIS DOCUMENT. WE'RE 

NOT SEEKING TO ADMIT THIS E-MAIL FOR THE TRUTH OF THE MATTER, 

BUT RATHER FOR ITS EFFECT ON MR. AMON, THE CONTENTS OF THIS 

E-MAIL FOR THE EFFECT ON MR. AMON. 

MR. MATHESON: NO OBJECTION IF NOT FOR THE TRUTH, 

YOUR HONOR. 

THE COURT: ALL RIGHT. GO AHEAD, PLEASE, IT'S 

ADMITTED FOR THAT LIMITED PURPOSE, AND YOU'LL NOTE THAT IN THE 

JOINT EXHIBIT LIST. 

(DEFENDANT'S EXHIBIT QX 9225 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. THANK YOU. 

BY MS. SESSIONS: 

Q. MR. AMON, HOW DID YOU REACT TO THE MESSAGE FROM APPLE THAT 

THERE WAS A CLEAR ALTERNATIVE WITH INTEL? 

A. I REACTED -- FIRST, I WAS ASKING SOME OF THE MEMBERS IN 

QCT IF THEY HAD INFORMATION THAT VALIDATED THAT APPLE CLAIM. 

AND MY REACTION IS THAT WE WILL HAVE TO COMPETE WITH THAT 

SOLUTION TO MAINTAIN THE APPLE BUSINESS. 

Q. DID QUALCOMM OFFER BETTER TERMS TO APPLE AS A RESULT? 

A. YES, WE DID. 

THE COURT: THERE WASN'T A HIGH PRIORITY OBJECTION ON 

THIS DOCUMENT. 

MS. SESSIONS: OH. I APOLOGIZE, YOUR HONOR. 

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THE COURT: THAT'S OKAY. 

MS. SESSIONS: IT WAS NOT MY INTENTION TO MISLEAD 

ANYBODY. 

Q. MR. AMON, COULD YOU PLEASE TURN BACK TO THE BINDER OF THE 

DOCUMENTS THAT THE FTC PROVIDED TO YOU AND TURN TO TAB 4. 

A. READY. 

Q. MR. AMON, IN CX 8276, WHAT WERE YOU PROPOSING? 

A. JUST GIVE ME A MOMENT. 

Q. SURE. 

(PAUSE IN PROCEEDINGS.) 

THE WITNESS: YES. THIS IS TALKING ABOUT A 

CONVERSATION ON HOW TO, YOU KNOW, PROPOSE AND WIN THE APPLE 

BUSINESS. 

SO WHAT I PROPOSE IN THIS E-MAIL IS WE FELT THAT WE WERE 

WELL POSITIONED ON THE PRODUCT SIDE FOR 13 AND 14. ON FEATURE, 

TIMING AND ENGINEERING, I'M THINKING AT THAT TIME I'M 

COMFORTABLE WITH OUR POSITION TO MEET THEIR NEEDS. 

I ALSO SAID THAT WE CAN COMPETE IN 15 AND 16. 

THE DISCUSSION WAS FOCUSSED ON 15, THAT WOULD BE THE FIRST 

YEAR, AND BASICALLY PROPOSING AT THAT TIME THAT WE WANTED TO 

HAVE ALL OF THEIR VOLUMES, AND I KNOW WE'RE COMING FROM AN 

AGREEMENT IN THE PAST THAT WE HAD 100 PERCENT OF THE APPLE 

VOLUME. 

SO I WAS PROPOSING TO OFFER THEM AN INCENTIVE OF $2 PER 

CHIPSET FOR CONSIDERATION TO GIVE US ALL THE VOLUME. THAT 

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WOULD BE, YOU KNOW, WE WILL BE THE EXCLUSIVE PROVIDER OF 

CHIPSETS TO APPLE. 

THEY COULD -- THEY DIDN'T -- THEY COULD REFUSE THE $2, BUT 

THEY WOULD NOT BE ENTITLED TO THAT $2 IF THEY DIDN'T GIVE ME 

THAT VOLUME. 

AND I WAS MAKING THAT PROPOSAL, WHICH BASICALLY WAS A 

REDUCTION OF OUR PRICE OF OUR SOLUTION TO THEM BY $2 AS 

CONSIDERATION FOR US TO BE THE EXCLUSIVE PROVIDER FOR THE 

IPHONES. 

AND I THOUGHT AT THIS E-MAIL THAT GIVEN THAT WE WERE THE 

SUPPLIER FOR 13 AND 14, BECAUSE I SEE AT THAT TIME TO BE 

COMFORTABLE IN OUR POSITION, YOU KNOW, THEY MAY BE MOTIVATED 

GIVEN OUR INCOMING POSITION. 

THIS IS, IN ESSENCE, THE PROPOSAL. 

Q. HAVE YOU BEEN INVOLVED WITH NEGOTIATIONS -- IN 

NEGOTIATIONS WITH APPLE REGARDING CHIP SUPPLY BETWEEN 2014 AND 

2016? 

A. I BELIEVE SO. 

Q. OKAY. WHAT WAS THE CONTEXT OF THOSE NEGOTIATIONS? 

A. WHEN I WOULD BE INVOLVED, IT WILL BE IN THE FINAL 

NEGOTIATION OF WHAT IS CALLED AN SOW. IT'S THE SCOPE OF WORK. 

IT DEFINES A PROJECT AND A CHIP AND IT TALKS ABOUT THE PRICING 

AND THE TECHNICAL CAPABILITIES AND THE SCHEDULE. 

I ALSO RECALL BEING IN PRODUCT PLANNING MEETINGS WITH 

THEIR ENGINEERING TEAM AND RECALL BEING IN MEETINGS WHEN WE'D 

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TALK ABOUT THE AMENDMENT OF THE STA. THAT'S A DOCUMENT THAT 

GOVERNS THE -- IT'S THE STRATEGIC TECHNICAL AGREEMENT. IT 

GOVERNS THE RELATIONSHIP BETWEEN APPLE AND QUALCOMM SINCE WE 

DON'T HAVE A DIRECT SUPPLY RELATIONSHIP TO THEM.

Q. OVER THE COURSE OF THESE NEGOTIATIONS, DID APPLE ASK FOR 

SUPPLY ASSURANCES FROM QUALCOMM? 

A. YES, THEY DID. 

Q. WHAT WERE THE NATURE OF THOSE DISCUSSIONS? 

A. THE ONES THAT I'VE BEEN INVOLVED, THEY HAVE, IN THE 

AGREEMENT BETWEEN QUALCOMM AND APPLE, THEY HAVE AN ASSURANCE OF 

18 MONTHS OF SUPPLY, AND THEY WANTED TO EXTEND THAT INTO A 

LONGER PERIOD OF TIME. 

Q. DID YOU HAVE ANY CONCERNS OVER EXTENDING THE PERIOD OF 

SUPPLY? 

A. NO. WE -- AS A RESULT OF THE NEGOTIATION, WE EXTENDED 

BEYOND 18. 

Q. DOES QUALCOMM PROVIDE OPEN-ENDED SUPPLY COMMITMENTS TO ITS 

CUSTOMERS?

A. WE DO NOT.

Q. WHY NOT? 

A. A NUMBER OF REASONS, BUT I WOULD SAY ONE OF THE MAIN ONES 

IS WE ARE -- WE'RE A FABLESS COMPANY, WHICH MEANS WE DON'T HAVE 

A HOME MANUFACTURING. SO WE'RE RELYING ON FOUNDRIES TO BUILD 

OUR CHIPS. AND MANY OF OUR SUPPLY GUARANTEES IN MANY CASES, 

THEY MATCH OUR AGREEMENTS OR EXPECTATIONS WITH OUR SUPPLIERS 

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ABOUT HOW LONG WILL THEY BE ABLE TO MAINTAIN THAT TECHNOLOGY IN 

PRODUCTION. 

THERE ARE OTHER CONSIDERATIONS AS WELL. THE ECONOMICS 

FROM OUR SUPPLIERS TO US THAT DEFINE HOW LONG WE CAN CONTINUE 

TO PRODUCE THE PRODUCT AND THE PRICES THAT WE EXPECT TO PAY OUR 

SUPPLIERS. 

Q. COULD YOU JUST ELABORATE A LITTLE BIT MORE ON WHAT YOU 

MEAN BY THE ECONOMICS? 

A. IF -- IF -- IN ORDER TO MAINTAIN -- IF I WANT TO STAY, FOR 

EXAMPLE, A GREAT EXAMPLE OF THAT IS A BUSINESS IN THE 

AUTOMOTIVE INDUSTRY. THE AUTOMOTIVE INDUSTRY, UNLIKE THE CELL 

PHONE, THEY EXPECT LONGER SUPPLY COMMITMENTS. 

IF MY SUPPLIER INTENDS TO OBSOLETE A CERTAIN TECHNOLOGY 

USED TO PRODUCE MY CHIP BECAUSE THEY WANT TO CONVERT THAT LINE 

INTO A MORE MODERN TECHNOLOGY, THE COST OF THAT TECHNOLOGY 

COULD BE PROHIBITIVE IF I WANTED TO CONTINUE BEYOND THE 

OBSOLESCENCE OF THE PRODUCT. 

THAT'S WHAT I MEANT. 

Q. MR. AMON, COULD YOU PLEASE TURN TO, IN THE BINDER OF 

DOCUMENTS FROM THE FTC, CX 5053, WHICH IS TAB 18. 

A. I'M READY. 

Q. MR. AMON, DO YOU SEE THE E-MAIL AUTHORED BY YOU ON 

NOVEMBER 19TH, 2012, IN THE CENTER OF PAGE 1 OF CX 5053? 

A. YES. 

Q. ABOUT FOUR LINES DOWN YOU WRITE "JIM DOH, JONATHAN WEISER: 

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UNITED STATES COURT REPORTERS

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CONSIDER THIS E-MAIL THE 'GO AHEAD.'" 

DO YOU SEE THAT?

A. YES, I DO.

Q. WHAT DID YOU MEAN BY THAT?

A. IT MEANT THAT JIM DOH, WHICH WAS THE HEAD OF SALES OF QCT, 

AND JONATHAN WEISER, WHICH IS LEGAL, I WAS INDICATING TO THEM 

THAT WAS THE GO AHEAD FOR US TO ENGAGE IN BUSINESS WITH THE 

OEM'S, THE MATTER OF THIS E-MAIL. 

I BELIEVE THIS IS RELATED TO THE SALES OF TD-SCDMA 

CHIPSETS TO CHINESE CUSTOMERS. 

Q. AND ON THE NEXT LINE YOU SAY, ABOUT MID-WAY THROUGH, "3 IS 

ALREADY INCLUDED IN THE CSA." 

DO YOU SEE THAT? 

A. YES, I DO.

Q. WHAT DID YOU MEAN BY THAT? 

A. GIVE ME A MOMENT TO REVIEW 3. 

Q. SURE. 

(PAUSE IN PROCEEDINGS.) 

THE WITNESS: YES. ERIC REIFSCHNEIDER, WHO WROTE THE 

ORIGINAL E-MAIL TO ME, HE WAS RESPONSIBLE FOR QTL. HE HAD 

SUGGESTED THAT IF, IN 3, THAT IF THE CUSTOMERS REFUSES OR FAIL 

TO PAY ROYALTY, HE WOULD LIKE TO DISCONTINUE SUPPLY TO THOSE 

CUSTOMERS. 

WHEN I WROTE MY E-MAIL, I WAS ADDRESSING ERIC BASICALLY 

SAYING WHATEVER YOU WANT IN 3, WE ALREADY HAVE COVERED IN THE 

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UNITED STATES COURT REPORTERS

542

CSA. 

THE CSA IS THE CHIPSET SUPPLY AGREEMENT THAT QCT USES TO 

DO BUSINESS WITH ITS CUSTOMERS. THE MAIN MATTER OF THIS E-MAIL 

IS THAT QCT WILL ONLY SELL PRODUCTS OR ENGAGE IN THE 

DEVELOPMENT OF PHONES WITH OUR CHIPSETS WITH CUSTOMERS THAT ARE 

A LICENSEE OF QUALCOMM ON QTL. 

AND THE CSA HAS A PROVISION THAT REQUIRES A CUSTOMER TO BE 

A LICENSEE, AND BASICALLY WHAT I WAS REFERRING TO ERIC IS 

WHATEVER HE WANTED IN 3, IF WE ALREADY HAVE A CSA, IT WAS 

ALREADY COVERED.

Q. DO YOU HAVE A DETAILED UNDERSTANDING OF THE TERM OF 

QUALCOMM'S CSA'S? 

A. I DON'T HAVE A DETAILED UNDERSTANDING. I HAVEN'T REVIEWED 

IT PERSONALLY. BUT I UNDERSTAND THAT IN GENERAL, IT REQUIRES 

THE CUSTOMERS TO HAVE A LICENSING AGREEMENT AND TO BE IN GOOD 

STANDING WITH QUALCOMM. THAT'S MY GENERAL UNDERSTANDING. 

Q. AS A RESULT OF THIS E-MAIL, DID YOU EVER TELL A CUSTOMER 

THAT YOU WOULD DISCONTINUE SUPPLY IF THEY WERE NOT PAYING 

ROYALTIES? 

A. NO. AS A RESULT OF THIS E-MAIL, WE ENGAGED IN BUSINESS 

WITH THOSE CUSTOMERS FOR TD-SCDMA. 

Q. MR. AMON, WHAT'S A PREMIUM TIER CHIP AT QUALCOMM? 

A. A PREMIUM TIER CHIP IN QUALCOMM IS A SNAPDRAGON 800. IT 

IS USUALLY DEFINED AS THE MOST ADVANCED SOC CHIPSET, MODEM PLUS 

THE APPLICATION PROCESSOR, THAT WE PROVIDE.

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543

Q. DOES QUALCOMM HAVE CUSTOMERS THAT USE A SNAPDRAGON 800 IN 

A LOWER END HANDSET? 

A. YES, WE DO.

Q. WOULD YOU PROVIDE SOME EXAMPLES? 

A. YES. XIAOMI, FOR EXAMPLE, IN THE MARKET OF INDIA, HAVE A 

DEVICE USING THE LATEST SNAPDRAGON 800. BUT IT'S SOLD IN THE 

MID-TIER PRICING, PRICING RANGE. 

Q. DOES QUALCOMM HAVE CUSTOMERS THAT USE NON-PREMIUM TIER 

QUALCOMM CHIPS IN THEIR HIGHEST END PHONES? 

A. YES, WE DO.

Q. WOULD YOU PROVIDE SOME EXAMPLES OF THOSE? 

A. ONE EXAMPLE IS COMPANIES LIKE VIVO AND OPPO IN CHINA. 

THEY WILL HAVE A PRODUCT NOT USING A PREMIUM TIER CHIPSET, 

MAYBE A SNAPDRAGON 600, FOR INSTANCE, AND THEY WILL SELL THOSE 

AT PREMIUM DEVICE ASP'S. THAT'S ONE EXAMPLE. 

THE OTHER EXAMPLE IS APPLE PHONES THAT, YOU KNOW, EVEN 

THOUGH WE DON'T PROVIDE A PREMIUM TIER CHIPSET, BUT WE'LL HAVE 

FEATURES ON OUR MODEM WHEN WE ARE THE SUPPLIER OF APPLE THAT 

ARE EQUIVALENT TO SOME OF OUR MID OR HIGH TIER CHIPSETS JUST 

BECAUSE THEY'RE LATE TO MARKET WITH SOME OF THE MODEM FEATURES.

Q. COULD YOU EXPLAIN WHAT YOU MEAN BY THEY'RE LATE TO MARKET? 

A. USUALLY THE, THE MODEM, THE MODEM THAT WAS GOING TO BE IN 

OUR PREMIUM TIER WHEN WE LAUNCH END UP BEING AVAILABLE IN THEIR 

PRODUCTS ABOUT ONE TO TWO YEARS LATER. THAT'S -- AT THAT TIME, 

THAT PRODUCT, FOR US, BECOMES LIKE A MID OR A HIGH TIER MODEM 

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AMON REDIRECT BY MR. MATHESON

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CAPABILITIES. 

Q. MR. AMON, DOES QUALCOMM SELL CHIPS TO COMPANIES THAT DO 

NOT SELL PHONES IN THE UNITED STATES? 

A. YES, WE DO.

Q. WHAT ARE SOME EXAMPLES? 

A. EXAMPLES ARE VIVO, XIAOMI, GIONEE. G-I-O-N-E-E. TC -- 

I'LL SAY LENOVO BRANDED PHONES, NOT THE MOTOROLA PHONES. 

I WOULD SAY HUAWEI, IF I DID NOT SAY THAT AS AN EXAMPLE. 

THERE ARE MANY OTHERS. THOSE ARE JUST SOME EXAMPLES OF 

THEM. 

MS. SESSIONS: THANK YOU, MR. AMON. I HAVE NO 

FURTHER QUESTIONS. 

THE COURT: OKAY. TIME IS 2:20. 

MR. MATHESON: MAY I PROCEED, YOUR HONOR. 

THE COURT: 2:20. GO AHEAD, PLEASE. 

REDIRECT EXAMINATION

BY MR. MATHESON: 

Q. MR. AMON, YOU REFERRED EARLIER TO THE PRICE THAT OEM'S PAY 

TO ACTIVATE CDMA FUNCTIONALITY ON A CHIP. 

DO YOU RECALL THAT?

A. YES.

Q. WHAT IS IT TO DIFFUSE CDMA FUNCTIONALITY FROM A CHIP MEAN? 

A. WHEN WE BUILD OUR CHIPS, WE HAVE ONE MULTIMODE PLATFORM, 

AND WE HAVE DIFFERENT VARIATIONS OF THE CHIP. SO WE'LL HAVE A 

VARIATION THAT HAS ALL THE CAPABILITIES, THAT WILL HAVE, FOR 

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EXAMPLE, FEATURES LIKE LTE, UMTS, OR CDMA IN THE MODEM SIDE. 

AND THEN WE WILL HAVE VERSIONS THAT SOME OF THOSE 

CAPABILITIES WILL BE DISABLED. 

WE FUSE THEM AT THE PRODUCTION TIME, AND, THEREFORE, THE 

HARDWARE IS DISABLED. SOMETIMES IT'S DISABLED BY SOFTWARE.

Q. SO TO FUSE MEANS TO DISABLE CDMA FUNCTIONALITY; IS THAT 

CORRECT? 

A. THAT IS CORRECT.

Q. SO YOU'RE NOT ATTACHING AN EXTRA WIDGET TO A CHIP THAT 

PROVIDES CDMA FUNCTIONALITY. WHAT YOU'RE DOING IS TAKING IT 

OUT OF THE CHIP UNLESS THE OEM WANTS TO PAY FOR IT; RIGHT? 

A. NOT NECESSARILY. THE WAY THE SEMICONDUCTOR WORKS TODAY 

ACROSS A NUMBER OF PRODUCTS, EVEN WHEN YOU BUY A PROCESSOR, 

THEY HAVE DIFFERENT CLOCK SPEEDS. 

SO TO CERTAIN PRODUCTS YOU HAVE A PRODUCT AT A HIGHER 

PERFORMANCE OR A LOWER PERFORMANCE. 

FOR EXAMPLE, IF YOU'RE NOT TALKING ABOUT MODEM, SOME OF 

OUR CHIPS MAY HAVE HIGHER NUMBER OF CPU'S OR LESS NUMBER OF 

CPU'S. 

SO WE HAVE DIFFERENT VARIATIONS OF THE PRODUCT. IN THE 

CASE OF MODEM, YOU CAN BUY A LA CARTE THE MODEMS THAT YOU WANT, 

OR YOU CAN HAVE THE SUPERSET. 

THIS IS HOW IT IS DONE. IT IS A COMPROMISE.

Q. SIR, THE DIFFERENCE BETWEEN A SUPERSET AND A NON-SUPERSET 

IS THAT YOU HAVE DEFUSED OR DISABLED THE CDMA FUNCTIONALITY IN 

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AMON REDIRECT BY MR. MATHESON

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546

THE NON-SUPERSET; IS THAT RIGHT? 

A. THAT IS CORRECT. 

Q. THANK YOU. CAN YOU TAKE A LOOK AT QX 9225 WHICH IS IN THE 

BINDER THAT YOUR COUNSEL SHOWED YOU. 

A. I'M READY.

Q. CAN YOU LOOK AT THE PAGE THAT ENDS DASH 742. 

DO YOU SEE AN E-MAIL THERE THAT YOU RECEIVED, AMONG 

OTHERS, FROM -- IN DECEMBER 2012?

THE LAST LINE OF THAT E-MAIL STATES "THE INTC/IFX PRICE 

BELOW --" NOW, THAT REFERS TO INTEL; RIGHT? 

A. YES. 

Q. "THEIR PRICE BEING LOW IS NO SURPRISE AS THEY WOULD LIKELY 

DO WHATEVER IT TOOK TO BUY THE DOCKET (TO MAKE UP FOR NO 

COMMERCIAL TRACK RECORD ON LTE, LET ALONE CA." 

NOW, IF INTEL HAD WON ON APPLE SOCKET TWO YEARS 

PREVIOUSLY, THEY WOULD HAVE HAD A COMMERCIAL TRACK RECORD ON 

LTE; RIGHT? 

A. THEY WOULD HAVE HAD COMMERCIAL TRACK RECORD AND SCALE. 

Q. NOW, SIR, YOU TESTIFIED IT WOULD BE DEVASTATING IF 

COMMITMENT TO THE INDUSTRY CUT OFF CHIP SUPPLY TO A CUSTOMER; 

RIGHT? 

A. YES.

Q. AND YOU CERTAINLY DO NOT WANT TO THREATEN CUSTOMERS WITH 

CUTTING OFF CHIP SUPPLY; RIGHT? 

A. ABSOLUTELY NOT.

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AMON REDIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

547

Q. NOW, SITTING HERE TODAY, YOU CAN'T RECALL HAVING EVER BEEN 

INFORMED THAT QTL THREATENED TO CUT OFF CHIP SUPPLY TO SONY; IS 

THAT TRUE? 

A. I -- YES, I DON'T RECALL THAT QCT HAS BEEN INFORMED TO CUT 

OFF CHIP SUPPLY TO SONY.

Q. I MEANT YOU PERSONALLY. YOU PERSONALLY, SITTING HERE 

TODAY, CANNOT RECALL HAVING EVER BEEN INFORMED THAT QTL 

THREATENED TO CUT OFF CHIP SUPPLY TO SONY? 

A. SONY, I DON'T RECALL.

Q. AND AT YOUR DEPOSITION, IN FACT, YOU COULD NOT RECALL 

HAVING EVER BEEN INFORMED THAT QTL THREATENED TO STOP PROVIDING 

CHIPSETS TO ANY CUSTOMER; IS THAT TRUE? 

A. YOU SHOWED ME EVIDENCE EARLIER. 

Q. MY QUESTION, SIR, IS WHAT YOU TESTIFIED AT YOUR 

DEPOSITION. ISN'T IT THE FACT THAT AT YOUR DEPOSITION YOU 

COULD NOT RECALL HAVING EVER BEEN INFORMED THAT QTL HAD EVER 

THREATENED TO STOP PROVIDING CHIPSETS TO A CUSTOMER?

A. SO SPECIFICALLY THE QUESTION ON QTL, I HAD BEEN INFORMED 

BY A CUSTOMER THAT WAS MOTOROLA.

Q. CAN I DIRECT YOUR ATTENTION, SIR, TO PAGE 50, LINE 24, TO 

51, LINES 20 -- LINE 2 OF YOUR DEPOSITION TRANSCRIPT. 

MS. SESSIONS: SORRY, COUNSEL. WHAT PAGE ARE YOU ON? 

MR. MATHESON: 50, LINE 24, TO 51, LINE 2.

Q. YOU WERE ASKED, SIR -- 

A. WHICH PAGE, I'M SORRY? 

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AMON REDIRECT BY MR. MATHESON

UNITED STATES COURT REPORTERS

548

Q. PAGE 50 OF YOUR DEPOSITION TRANSCRIPT, LINE 24 TO PAGE 51, 

LINE 2. 

YOU WERE ASKED AT YOUR DEPOSITION, SIR, "YOU HAVE NEVER 

BEEN INFORMED THAT QTL THREATENED TO CEASE SUPPLYING CHIPSETS 

TO A CUSTOMER BECAUSE OF A LICENSING DISPUTE; IS THAT RIGHT?"

AND YOU ANSWERED "THAT IS CORRECT." 

YOU WERE ASKED THAT QUESTION AND YOU GAVE THAT ANSWER AT 

YOUR DEPOSITION; RIGHT? 

A. GIVE ME A MOMENT. PAGE 50, WHAT LINE? 

Q. LINE 24 THROUGH 51, LINE 2. YOU CAN SEE IT RIGHT ON YOUR 

SCREEN, SIR. 

YOU WERE ASKED, "YOU HAVE NEVER BEEN INFORMED THAT QTL 

THREATENED TO CEASE SUPPLYING CHIPSETS TO A CUSTOMER BECAUSE OF 

A LICENSING DISPUTE; IS THAT RIGHT?"

YOU ANSWERED "THAT IS CORRECT." 

THAT WAS A TRUE STATEMENT WHEN YOU SAID IT? 

A. THAT IS CORRECT.

Q. NOW, BASED ON THE NOTES THAT WE LOOKED AT THAT YOU TOOK IN 

DECEMBER 2015, YOU CAN NOW RECALL THAT, IN FACT, RICK OSTERLOH 

DID TELL YOU THAT ERIC REIFSCHNEIDER WAS CONSTANTLY THREATENING 

TO CUT OFF SUPPLY; RIGHT? 

A. YES, THAT'S WHAT I HEARD FROM MOTOROLA.

Q. NOW, IF IT'S THE CASE THAT A HUAWEI EXECUTIVE TESTIFIED 

UNDER OATH THAT ERIC REIFSCHNEIDER THREATENED TO CUT OFF CHIP 

SUPPLY TO HUAWEI, NOW, EITHER SHE'S LYING OR YOU WERE JUST 

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AMON REDIRECT BY MR. MATHESON

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NEVER INFORMED OF THAT THREAT; RIGHT? 

A. I WAS NOT INFORMED OF A THREAT TO CUT SUPPLY OFF HUAWEI.

Q. AND IF AN EXECUTIVE FROM LENOVO AND MOTOROLA TESTIFIED 

UNDER OATH THAT ERIC REIFSCHNEIDER THREATENED TO CUT OFF THEIR 

CHIP SUPPLY, EITHER THAT PERSON IS LYING OR YOU JUST WEREN'T 

INFORMED OF THE THREAT; RIGHT? 

A. IN THE CASE OF MOTOROLA, I WAS INFORMED AT THAT TIME IN 

THE MEETING WITH RICK OSTERLOH THAT HE TOLD ME THAT ERIC HAD 

MADE THAT THREAT. 

Q. NOW, CAN WE LOOK AT CX 5321, WHICH IS TAB 13 OF THE BINDER 

I GAVE YOU, AT PAGE 2. 

LET ME DIRECT YOUR ATTENTION TO THE BOLDED TEXT AT THE 

BOTTOM OF THE PAGE THAT BEGINS "DURING THE LAST 24 HOURS." 

A. YES.

Q. NOW, IT'S FAIR TO SAY THAT WHAT VIVO WAS REQUESTING IS 

THAT QTL PROVIDES CONFIRMATION THAT IF VIVO CONTINUES TO 

NEGOTIATE IN GOOD FAITH, QCT WILL CONTINUE SHIPPING CHIPSETS; 

RIGHT? 

A. WHAT IT'S BASICALLY SAYING HERE IS THAT IF THEY'RE 

NEGOTIATING IN GOOD FAITH WITH QTL, QCT COULD ENGAGE -- 

Q. MY QUESTION, SIR, IS THEY'RE ASKING FOR QTL'S ASSURANCE, 

NOT FOR THE ASSURANCE OF THE PRESIDENT OF QCT; RIGHT? 

A. THAT'S NOT THE INTENT OF WHAT THIS WAS WRITTEN. 

Q. THE WORD STATES, SIR, "IF QTL PROVIDES CONFIRMATION THAT 

IF VIVO CONTINUES TO NEGOTIATE WITH QTL IN GOOD FAITH, QCT WILL 

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AMON REDIRECT BY MR. MATHESON

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550

CONTINUE SHIPPING CHIPSETS." 

IT'S FAIR THAT WHAT VIVO SOUGHT WAS CONFIRMATION FROM QTL, 

NOT FROM THE PRESIDENT OF QCT; ISN'T THAT RIGHT? 

A. WHAT -- THAT'S NOT CORRECT. 

MR. MATHESON: NO FURTHER QUESTIONS. 

THE COURT: OKAY. TIME IS 2:28. 

MS. SESSIONS: NO FURTHER QUESTIONS, YOUR HONOR. 

THE COURT: OKAY. 

MS. SESSIONS: BUT WE MAY RECALL MR. AMON, SUBJECT TO 

THE REMAINDER OF THE FTC'S CASE. 

THE COURT: OKAY. SO HE IS SUBJECT TO RECALL. SO 

YOU MAY STEP DOWN NOW, SIR, BUT YOU HAVE NOT COMPLETED YOUR 

TRIAL TESTIMONY. OKAY? YOU ARE SUBJECT TO RECALL. 

THE WITNESS: THANK YOU VERY MUCH. 

THE COURT: ARE YOUR NEXT WITNESSES ALL BY VIDEO? 

MR. CARSON: NO, YOUR HONOR. WE HAVE ONE MORE LIVE 

WITNESS, MS. AICHA EVANS. 

THE COURT: ALL RIGHT. I THINK FOR THE SAKE OF OUR 

COURT REPORTERS, WE SHOULD TAKE A TEN MINUTE BREAK. 

MR. CARSON: YES, YOUR HONOR. 

THE COURT: OKAY. THANK YOU. 

(RECESS FROM 2:29 P.M. UNTIL 2:41 P.M.) 

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

CALL YOUR NEXT WITNESS. 

MR. CARSON: YOUR HONOR, WESLEY CARSON FOR THE FTC. 

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EVANS DIRECT BY MR. CARSON

UNITED STATES COURT REPORTERS

551

AT THIS TIME WE CALL AICHA EVANS TO THE STAND. 

THE COURT: OKAY. 

MR. CARSON: MAY I APPROACH WITH BINDERS? 

THE COURT: YES, PLEASE. 

THE CLERK: PLEASE RAISE YOUR RIGHT HAND. 

(PLAINTIFF'S WITNESS, AICHATOU EVANS, WAS SWORN.)

THE WITNESS: YES, I DO. 

THE CLERK: THANK YOU. PLEASE BE SEATED. 

THE WITNESS: THANK YOU. 

THE CLERK: WOULD YOU PLEASE STATE YOUR FULL NAME AND 

SPELL YOUR LAST NAME FOR THE RECORD. 

THE WITNESS: HELLO. MY NAME IS AICHATOU, AICHA 

EVANS. LAST NAME E V A N S. 

THE COURT: WOULD YOU SPELL THE FIRST NAME, PLEASE. 

THE WITNESS: A-I-C-H-A-T-O-U. 

THE COURT: ALL RIGHT. 

TIME IS 2:42. GO AHEAD, PLEASE. 

MR. CARSON: THANK YOU, YOUR HONOR.

DIRECT EXAMINATION

BY MR. CARSON:

Q. HELLO. COULD YOU INTRODUCE YOURSELF TO JUDGE KOH?

A. HELLO, JUDGE KOH. MY NAME IS AICHA EVANS FROM INTEL. 

Q. WHERE DID YOU GROW UP? 

A. I WAS BORN IN SENEGAL, S-E-N-E-G-A-L, WEST AFRICA, AND I 

GREW UP BETWEEN PARIS AND SENEGAL. 

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EVANS DIRECT BY MR. CARSON

UNITED STATES COURT REPORTERS

552

Q. COULD YOU BRIEFLY SUMMARIZE YOUR EDUCATION, STARTING WITH 

COLLEGE? 

A. I WENT THROUGH SUPERIOR AND SPECIAL MATHEMATICS IN FRANCE, 

AND THEN I GRADUATED FROM THE GEORGE WASHINGTON UNIVERSITY IN 

D.C. IN COMPUTER ENGINEERING.

Q. WHAT'S YOUR CURRENT POSITION AT INTEL? 

A. I AM THE, A SENIOR VICE PRESIDENT AND THE CHIEF STRATEGY 

OFFICER FOR INTEL CORPORATION.

Q. WHAT ARE YOUR RESPONSIBILITIES AS THE CHIEF STRATEGY 

OFFICER AT INTEL? 

A. WE ARE UNDERGOING A TRANSFORMATION. WE WERE VERY MUCH 

BUILT AROUND THE PC, AND NOW WE'RE MOVING TO THE CLOUDS AND 

DATA CENTRIC WORLD, AND THIS REQUIRES A LOT OF CHANGE ACROSS 

THE DIFFERENT BUSINESSES AND IN TERMS OF OUR PROCESSES. AND I 

HELP MAKE THAT HAPPEN.

Q. NOW, MS. EVANS, ARE YOU ON INTEL MANAGEMENT COMMITTEE? 

A. YES, I AM.

Q. WHAT DO YOU DO ON THE MANAGEMENT COMMITTEE? 

A. WE MAKE, I HOPE, WE MAKE A LOT OF DECISIONS, ANYTHING 

AROUND HR, AROUND BUSINESSES, P&L PLAN, STRATEGY. WE 

ESSENTIALLY MAKE MOST OF THE CORPORATE DECISIONS. 

Q. HOW MANY YEARS HAVE YOU WORKED IN THE WIRELESS 

COMMUNICATIONS INDUSTRY IN TOTAL?

A. OVER 20 YEARS. 

Q. LET'S TALK ABOUT THE BACKGROUND OF THAT INDUSTRY. ARE YOU 

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EVANS DIRECT BY MR. CARSON

UNITED STATES COURT REPORTERS

553

FAMILIAR WITH THE TERM OEM?

A. YES, I AM.

Q. WHAT IS AN OEM? 

A. AN OEM, IT STANDS FOR ORIGINAL EQUIPMENT MANUFACTURER, AND 

THESE ARE COMPANIES WORLDWIDE THAT BUILD DEVICES, AND THEY SELL 

THEM TO CUSTOMERS. AND BY DEVICES I MEAN ANYWHERE FROM A 

HANDSET TO A CAR, ANYTHING THAT HAS COMPUTE AND/OR 

COMMUNICATIONS.

Q. COULD YOU GIVE US SOME EXAMPLES OF OEM'S? 

A. SAMSUNG, APPLE, TESLA, LENOVO. 

Q. NOW, ARE YOU FAMILIAR WITH THE WAY THAT OEM'S WORK WITH 

THEIR COMPONENT SUPPLIERS? 

A. YES, I AM. 

Q. WHICH COMPONENT SUPPLIERS HAVE YOU WORKED FOR IN THE PAST? 

A. I WORKED FOR SKYWORKS AND ITS DIFFERENT INCARNATIONS. IT 

WAS CONEXANT, CONEXANT, C-O-N-E-X-A-N-T; AND ROCKWELL 

SEMICONDUCTOR; AND BROOKTHREE, B-R-O-O-K-T-H-R-E-E. SORRY, I'M 

NOT A NATIVE SPEAKER. SO THE SPELLING AND THE NUMBERS GET 

COMPLICATED.

Q. WHAT KIND OF PRODUCTS DID SKYWORKS PROVIDE?

A. SKYWORKS, WELL, TODAY, THEY SPECIALIZE IN RADIOFREQUENCY 

COMPONENTS, LIKE FILTER, SWITCHES, THAT TYPE OF STUFF. BACK 

WHEN I WORKED WITH THEM, THEY ALSO WERE IN THE BASEBAND 

BUSINESS. 

Q. SO YOU SAID BASEBAND. ARE BASEBANDS ANOTHER NAME FOR 

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MODEM CHIPS? 

A. YES, THEY ARE. 

Q. WHAT ARE SOME EXAMPLES OF POSITIONS THAT YOU'VE HELD AT 

SKYWORKS AND INTEL? 

A. I STARTED AS A SILICON ENGINEER AND THEN I MOVED INTO 

SYSTEM ENGINEERING FOR THE PHYSICAL LAYER. AND THEN FROM 

THERE, I MOVED INTO LEADERSHIP AND A MANAGEMENT POSITION AND UP 

TO EXECUTIVE POSITIONS. 

WHEN I STARTED INTO MANAGEMENT, IT WAS FIRST ENGINEERING, 

AND THEN IT GREW INTO SORT OF ENGINEERING, BUSINESS, CUSTOMERS, 

AND SO ON. SO GM.

Q. HAVE YOU PERSONALLY PARTICIPATED IN DISCUSSIONS WITH OEM'S 

ABOUT COMPONENT SALES? 

A. YES, I HAVE. 

Q. AND IN YOUR EXPERIENCE HOW DO COMPONENT SUPPLIERS 

TYPICALLY CHARGE FOR THEIR PRODUCTS? 

A. TYPICALLY WE -- BASICALLY THE CUSTOMER TELLS US, LIKE WE, 

WE BUILD WHAT THEY REQUIRE, THE PRODUCTS THAT THEY WANT. 

ONCE WE BUILD THEM ON THE SCHEDULE THAT'S AGREED UPON, WE 

DELIVER TO THEM, AND OBVIOUSLY THERE'S ALSO A PRICING 

NEGOTIATION. SO WE AGREE ON THE PRICE, AND WE DELIVER, AND WE 

GET PAID, AND THEN THEY ARE FREE TO USE. AND THERE MAY BE 

SUPPORT, ONGOING SUPPORT.

Q. NOW, DO THE COMPONENT SUPPLIERS YOU WORKED FOR EVER CHARGE 

FOR PATENT ROYALTIES? 

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A. NO. 

Q. ARE YOU AWARE OF ANY COMPANY, ANY COMPONENT SUPPLIER THAT 

CHARGES FOR PATENT ROYALTIES FOR THE USE OF THOSE COMPONENTS? 

A. NO, EXCEPT FOR ONE, QUALCOMM. 

Q. LET'S SET ASIDE QUALCOMM FOR A MOMENT. 

FOR ALL THE OTHER SEMICONDUCTOR, OR ALL THE OTHER 

COMPONENT SUPPLIERS, WHAT DOES THE ALL-IN PRICE OF THAT 

COMPONENT SALE CONSIST OF?

A. IT INCLUDES EVERYTHING, THE PHYSICAL PRODUCT AND ALL OF 

THE VALUABLES AND I.P., INCLUDING SOFTWARE, HARDWARE, AND THE 

SUPPORT THAT'S EMBEDDED, ESSENTIALLY. THAT'S THE ALL-IN PRICE.

Q. SO, FOR INSTANCE, DOES INTEL CHARGE SEPARATE ROYALTIES FOR 

USING ITS MODEM CHIPS? 

A. NO, WE DO NOT.

Q. LET'S MOVE ON TO QUALCOMM THEN. 

WHAT'S YOUR PERSONAL EXPERIENCE IN COMPETING AGAINST 

QUALCOMM? 

A. I'VE BEEN COMPETING WITH THEM FOR A LONG TIME AT DIFFERENT 

COMPANIES, AS I SAID EARLIER. AND THE DIFFERENCE IS THAT THEY 

HAVE -- THEIR ALL-IN PRICE INCLUDES TWO COMPONENTS, THE, SORT 

OF THE CHIP PRICE, WE CALL IT, PLUS THE ROYALTY ON TOP OF IT.

Q. SO IN YOUR EXPERIENCE HOW DOES COMPETING AGAINST QUALCOMM 

COMPARE WITH COMPETING AGAINST OTHER COMPONENT SUPPLIERS? 

A. IT'S TOUGH AND VERY DIFFERENT BECAUSE WITH OTHER, OTHER 

COMPONENT SUPPLIERS OR COMPETITORS, IT'S ESSENTIALLY A BATTLE 

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OF FEATURES AND PRICE AND THAT'S IT AND YOU COMPETE BASED ON 

THAT AND WHOEVER MAKES IT, MAKES IT. 

WHEREAS WITH QUALCOMM, IT'S DIFFERENT BECAUSE OF THE 

BUSINESS MODEL, WHICH MAKES IT A VERY DIFFICULT LEVEL PLAYING 

FIELD. IT'S PRETTY MUCH VERY TOUGH TO COMPETE IN THAT, VERY 

UNFAIR.

Q. LET'S BREAK DOWN THAT BUSINESS MODEL A LITTLE BIT. 

SO TO YOUR KNOWLEDGE DOES QUALCOMM CHARGE CUSTOMERS FOR 

THE PRICE OF THE MODEM CHIP ITSELF? 

A. YES, TO MY KNOWLEDGE, THEY DO.

Q. AND TO YOUR KNOWLEDGE DOES QUALCOMM CHARGE A PATENT 

ROYALTY FOR USING THOSE MODEM CHIPS? 

A. YES, THEY DO. 

Q. NOW, YOU'RE NOT A LAWYER, ARE YOU? 

A. NOPE. 

Q. ARE YOU AN EXPERT IN THE LAW OF PATENT EXHAUSTION? 

A. ABSOLUTELY NOT.

Q. SO LET ME ASK YOU FROM A BUSINESS PERSPECTIVE, APART FROM 

QUALCOMM, ARE YOU AWARE OF ANY OTHER COMPANIES THAT SELL A 

MODEM CHIP AND THEN COLLECT ROYALTIES ON THAT SAME MODEM CHIP? 

A. NO, I AM NOT. 

Q. SO THEN WHAT IS THE ALL-IN COST OF A MODEM CHIP FROM 

QUALCOMM CONSIST OF? 

A. IT'S THE, THE SINGLE BUCKET, WHICH IS THE SUM OF THE CHIP 

PRICE, PLUS THE ROYALTY. 

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Q. NOW, TO YOUR KNOWLEDGE DOES QUALCOMM ALSO SEEK TO COLLECT 

ROYALTIES FOR THE USE OF OTHER COMPANIES' CHIPS BY OEM'S? 

A. YES, THEY DO. 

Q. WHAT ARE THE IMPLICATIONS OF THAT PRACTICE FOR THE ALL-IN 

PRICE OF INTEL CHIPS? 

A. FOR THE INTEL CHIPS, OR INTEL PRODUCT, YOU -- WE BASICALLY 

HAVE THE CHIP PRICE, AND THEN WE KNOW THAT WHAT HAPPENS 

AFTERWARDS, WITHOUT US AT THE TABLE, IS THAT THERE'S A QUALCOMM 

ROYALTY THAT IS ADDED TO THAT. 

AND SO THE FINAL ALL-IN PRICE FOR THE CUSTOMER IS OUR 

CHIPSET PRICE, PLUS THE QUALCOMM ROYALTY. 

Q. AND HOW DOES THAT AFFECT INTEL? 

A. IT'S, IT'S A VERY DIFFICULT SITUATION. I MEAN, IT'S -- 

IT'S CREATED -- FIRST OF ALL, NOBODY ELSE DOES THAT IN THE 

INDUSTRY. 

SECOND OF ALL, YOU HAVE YOUR CUSTOMER THAT YOU'RE USED TO 

A BUSINESS WHERE YOU BASICALLY BUILD THE PRODUCT THAT THEY WANT 

ON THE SCHEDULE THAT THEY WANT AT THE PRICE YOU AGREED UPON AND 

YOU GIVE THEM THE PRODUCT AND THEY PAY YOU FOR THE USE OF THAT 

PRODUCT. 

BUT NOW WHAT HAPPENS IS IT GETS BROKEN DOWN INTO TWO STEPS 

BECAUSE YOU HAVE YOUR PRODUCT, YOUR SELLING PRICE, AND THEN YOU 

KNOW THAT THERE'S SOME OTHER NEGOTIATION WITH A COMPETITOR THAT 

IS TRYING TO DISLODGE YOU TO BEGIN WITH THAT CONTROLS A 

SIGNIFICANT PORTION OF YOUR PRICING THROUGH THE ROYALTY. 

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Q. IF QUALCOMM WERE ABLE TO SHIFT THE COST FROM ITS PATENT 

ROYALTY TO ITS MODEM SHIP OR SHIFT THE COST OF THE MODEM CHIP 

TO THE PATENT ROYALTY, WOULD THAT HAVE IMPLICATIONS FOR INTEL'S 

COMPETITIVENESS WITH QUALCOMM? 

A. YEAH. SO IF I MAY ELABORATE A LITTLE BIT?

Q. SURE. 

A. I THINK THE BEST WAY TO GO THROUGH THIS IS SORT OF IT -- 

I'M GOING TO START ON THE QUALCOMM SIDE. 

SO FIRST OF ALL, WE'RE BOTH COMPETING FOR THE SOCKET, 

RIGHT? THAT'S THE PREMISE, MEANING FOR THE CUSTOMER. 

SO ON THE QUALCOMM SIDE, TO MY EXPERIENCE AND TO MY 

KNOWLEDGE THERE IS AN ALL-IN PRICE AND YOU HAVE -- FIRST OF 

ALL, THE CUSTOMER IS DEALING WITH THE SITUATION WHERE NOBODY 

ELSE DOES THIS, ONLY QUALCOMM. 

SO NOW THERE IS THIS CHIP PRICE, AND ON TOP OF IT THERE'S 

THIS ROYALTY PRICE. FOR THEM, QUALCOMM, IT DOESN'T REALLY 

MATTER BECAUSE BOTH MONIES ARE THE ALL-IN PRICE AND GO TO THEM 

AND THEY CAN SHIFT THE PRICE FROM CHIPSET TO ROYALTY, WHICH 

THEN UNDERCUTS ME AS THE COMPETITOR. 

AND BY THE WAY, IT'S NOT LIKE IT RESULTS INTO A LOWER 

PRICE FOR THE CUSTOMER. 

THEN YOU COME ON THE INTEL SIDE AND YOU HAVE THE CHIPSET 

PRICE, AND THEN BEHIND, MEANING WE ARE NOT IN THE ROOM, YOU 

HAVE BASICALLY THE CUSTOMER NEGOTIATING WITH QUALCOMM, WHO'S 

TRYING TO UNDERCUT US TO BEGIN WITH, ON THE ROYALTY AND THAT 

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TACKS ON AND I HAVE NO CONTROL OVER THAT AND IN SOME CASES I 

DON'T EVEN -- IN MOST CASES I DON'T EVEN KNOW. WE, INTEL, 

DON'T EVEN KNOW WHAT IT IS. 

IT MAKES IT A VERY, VERY UNFAIR LEVEL PLAYING FIELD.

Q. DOES IT SOLVE THE PROBLEM IF THE ROYALTY THAT QUALCOMM 

CHARGES ON QUALCOMM CHIPS AND INTEL CHIPS WERE THE EXACT SAME? 

A. NO, IT DOESN'T SOLVE THE PROBLEM BECAUSE AT THE END OF THE 

DAY THE ABILITY TO SHIFT FROM CHIPSET TO, TO ROYALTY DOESN'T 

CHANGE. THAT'S ONE. 

IN MY -- IN OUR VIEW, WHAT SOLVES THE PROBLEM IS IF WE 

HAVE THE ABILITY, LIKE WE DO IN ALL OTHER SECTORS OF THIS 

INDUSTRY, TO BASICALLY SET OUR -- BUILD THE PRODUCT THAT THE 

CUSTOMER WANTS ON THE SCHEDULE THAT THEY WANT, UNDER THE ALL-IN 

PRICE THAT WE AGREED UPON, AND THEN WE GET PAID. 

BUT OBVIOUSLY I DON'T HAVE -- WE DON'T HAVE TODAY THE 

OPPORTUNITY TO DO THAT BECAUSE IT WOULD REQUIRE FOR US TO HAVE 

A LICENSE WHICH, YOU KNOW, THEY DON'T OFFER. "THEY" BEING 

QUALCOMM. 

Q. SO WHY DOESN'T INTEL JUST ADOPT THE SAME BUSINESS MODEL 

THAT QUALCOMM USES? 

A. WE WOULD NEVER DO THAT. I MEAN, WE, WE BELIEVE IN THE 

SYSTEM WHERE YOU AGREE ON THE PRODUCT, THE FEATURES, THE PRICE, 

THE SCHEDULE, YOU DELIVER, THE CUSTOMER PAYS AND THEN THE 

CUSTOMER USES IT. 

WE -- WE'VE STUDIED THIS A LOT AND WE -- WE'RE NOT DOING 

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IT, BUT THIS BUSINESS MODEL SINCE WE HAVE TO COMPETE DAY IN AND 

DAY OUT AND WE'RE IN SUCH A CONTINUOUS, FRAGILE SITUATION WITH 

THE MODEM BUSINESS AT INTEL THAT WE PAY A LOT OF ATTENTION TO 

THIS BUSINESS MODEL. 

AND, FRANKLY, WE REALLY CAN'T SEE ANY LOGICAL REASON TO 

HAVE SUCH A BUSINESS MODEL EXCEPT HAVING THE ABILITY TO CONTROL 

YOUR COMPETITORS AND KEEP THEM AT BAY. 

Q. LET'S MOVE ON AND TALK A LITTLE BIT MORE ABOUT THE MODEM 

CHIP INDUSTRY ITSELF. 

NOW, PER THIS COURT'S ORDER, EVENTS AFTER MARCH 2018 ARE 

EXCLUDED, SO IF YOU COULD STOP FROM REFERRING -- I KNOW IT 

MIGHT BE TOUGH -- TO EVENTS THAT HAPPENED AFTER MARCH 2018, 

THAT WOULD BE GREAT. COULD YOU DO THAT? 

A. I'M GOING TO TRY MY BEST.

Q. GREAT. NOW, YOU'VE HEARD OF THE TERM PREMIUM MODEM 

BEFORE, HAVEN'T YOU? 

A. YES, I HAVE.

Q. WHAT IS A PREMIUM MODEM? 

A. IT'S THE MOST ADVANCED FEATURES AND TECHNIQUES AND FORM 

FACTORS ON -- THAT ARE ACTUALLY DEPLOYED ON THE MOST ADVANCED 

LEADING NETWORK SUCH AS, FOR EXAMPLE, AN AT&T OR VERIZON.

Q. DOES INTEL FOCUS ON PREMIUM MODEMS? 

A. YES, IT IS OUR FOCUS.

Q. AND IN YOUR EXPERIENCE, WILL HANDSET OEM'S WHO ARE LOOKING 

TO BUY A PREMIUM MODEM BE ABLE TO SUBSTITUTE NON-PREMIUM MODEMS 

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IN THOSE HANDSETS? 

A. OKAY. SO I KNOW I'M WITH LAWYERS, SO I'M GOING TO TRY TO 

BE CRISP AND CLEAR. 

"BE ABLE" IS SORT OF AN INTERESTING WORD. ARE THEY 

MATHEMATICALLY AND PHYSICALLY ABLE TO DO THAT? YES. IT WOULD 

NOT BE VERY WISE BECAUSE FROM A COMPETITIVE STANDPOINT, THEN 

THAT OEM IS PUTTING, IN A PREMIUM DEVICE, A LESS COMPETITIVE 

MODEM WHICH THE CUSTOMER WILL, WILL FEEL, FOR EXAMPLE, LIKE 

RIGHT NOW THERE ARE MILLIONS OF BITS, I'M SURE THERE ARE PHONES 

AND PEOPLE TWEETING AND READING E-MAIL EVEN THOUGH WE'RE IN 

COURT. 

AND ESSENTIALLY IT'S GOING TO BE SLOW OR IT'S NOT GOING TO 

BE RESPONSIVE OR THE THROUGHPUT IS GOING TO BE LOW. 

SO, YES, THEY TECHNICALLY CAN DO THAT, PHYSICALLY AND 

MATHEMATICALLY, BUT IT WOULDN'T BE A VERY WISE BUSINESS 

DECISION.

Q. SO WHAT ABOUT THE OPPOSITE SITUATION? WILL HANDSET OEM 

LOOKING FOR A NON-PREMIUM MODEM BE ABLE TO SUBSTITUTE A PREMIUM 

MODEM IN THEIR HANDSET? 

A. SHORT ANSWER AT THIS TIME. YES, MATHEMATICALLY AND 

TECHNICALLY AND PHYSICALLY THAT IS POSSIBLE. 

IT ALSO WOULD BE A VERY UNWISE DECISION BECAUSE THEN THAT 

OEM IS BUILDING A LOWER TIER HANDSET THAT THEY WILL SELL FOR 

LESS, AND THEN THE CUSTOMER WOULD BE VERY HAPPY BECAUSE THEY 

WOULD GET AN ADVANCED MODEM FEATURE SET DEPLOYED ON THE 

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NETWORK. 

BUT FROM A COST STANDPOINT, IT DOESN'T MAKE BUSINESS SENSE 

BECAUSE ESSENTIALLY THE COST OF THE MODEM WOULD BE HIGHER AND 

YOU WOULDN'T GET IT BACK ON THE ASP SIDE. 

Q. LET'S TALK ABOUT THE INDUSTRY ITSELF. HOW MANY COMPANIES 

CURRENTLY SUPPLY PREMIUM MODEMS? 

A. SO SORRY AGAIN, A LITTLE LONGER ANSWER BECAUSE IT -- I 

WANT TO TALK ABOUT THE WHOLE INDUSTRY, RIGHT, TO BE PRECISE. 

SO THERE IS A TERM THAT WE USE IN OUR INDUSTRY CALLED 

MERCHANTS, WHICH MEANS THAT YOU SELL TO ANYBODY. IT'S KIND OF 

LIKE YOU'RE OPEN TO -- YOU CAN -- NOT YOU SELL. YOU CAN CHOOSE 

TO SELL TO ANYBODY. 

FOR THAT, IT'S QUALCOMM AND INTEL, AND THAT'S SORT OF THE 

MERCHANTS OR YOU ALSO HEAR THE TERM OPEN MARKET. 

THEN YOU HAVE WHAT WE CALL THE CAPTIVE MARKET. SO, FOR 

EXAMPLE, HUAWEI IS AN OEM, MEANING THEY HAVE HANDSETS AND OTHER 

TYPES OF DEVICES, AND THEN THEY HAVE THEIR OWN SILICON HOUSE, 

HISILICON, THAT BUILDS FOR THEM. SO THAT'S ONE. 

AND BY THE WAY, IT'S ALSO MOSTLY CHINA OUTWARDS. 

THEN YOU HAVE SAMSUNG, WHICH DOES THE SAME THING. YOU 

HAVE HANDSETS AND OTHER DEVICES FROM SAMSUNG AND THEY HAVE SLSI 

THAT IS THEIR OWN SILICON HOUSE THAT MAINLY BUILDS SILICON FOR 

THOSE SAMSUNG DEVICES AND USES KOREA AS THE ADVANCED NETWORKS 

AS A LAUNCHING PAD. 

THEN, TO BE FAIR, YOU HAVE A COUPLE OTHER COMPANIES, 

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MEDIATEK OUT OF TAIWAN, AND SPREADTRUM OUT OF UNISOC OUT OF 

CHINA, BUT THOSE WE DON'T ACTUALLY CONSIDER PREMIUM BECAUSE 

THEY TEND TO BE ONE TO TWO GENERATIONS BEHIND ON THE MODEM 

SIDE. 

Q. SO DOES INTEL CONSIDER ITS IN COMPETITION WITH THESE 

NON-MERCHANT SUPPLIERS YOU MENTIONED, THE HUAWEI AND SAMSUNG 

MODEM CHIP PRODUCERS? 

A. NO. WE CONSIDER THEM ACTUALLY TO BE CUSTOMERS OR 

POTENTIAL CUSTOMERS. 

Q. NOW, WHEN DID INTEL ENTER THE PREMIUM CHIP MARKET? 

A. "ENTER" IS A COMPLICATED TERM. OUR FIRST BIG LAUNCH, LIKE 

SIGNIFICANT LAUNCH, WAS SEPTEMBER 2016. BUT IN TERMS OF 

MODEMS, IT TAKE A LOT OF R&D, RESEARCH AND DEVELOPMENT, MONEY 

AND INVESTMENT AND TIME AND ARE VERY COMPLEX. 

SO IN -- WELL, IN 2011 WE ACQUIRED, MEANING THE 

TRANSACTION CLOSED, INFINEON WIRELESS, AND THAT'S WHERE I WOULD 

SAY WE STARTED IN EARNEST TO DEVELOP FOR THE PREMIUM BASEBAND 

MARKET.

Q. WHY DID INTEL ACQUIRE INFINEON WIRELESS? 

A. FOR THE LONGEST TIME WE HAD DIFFERENT FOLKS ON THE 

MANAGEMENT COMMITTEE TEAM THAT WERE OF THE BELIEF THAT THERE 

WOULD BE AN ACCELERATION OF A CONVERGENCE OF COMPUTE AND 

COMMUNICATION, NOT JUST IN MOBILE HANDSETS, BUT ESPECIALLY IN 

THE FUTURE OVER THE NEXT, DEPENDING ON WHO YOU BELIEVE, 10, 20, 

30 YEARS. BASICALLY EVERYTHING THAT COMPUTES OR DRAWS 

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ELECTRICITY WILL CONNECT AND ALSO NEED TO COMMUNICATE. 

SINCE WE'RE IN SILICON VALLEY AND AUTONOMOUS DRIVING IS A 

DARLING SEGMENT RIGHT NOW, THAT'S AN EASY EXAMPLE WHERE FOR THE 

CARS TO BE ABLE TO DRIVE THEMSELVES AND DO IT RELIABLY AND 

SAFELY, THEY NEED TO COMMUNICATE ON THE NETWORK BACK AND FORTH 

AND THEY NEED TO BE RESPONSIVE AND SO ON AND SO FORTH. 

SO ONCE WE CAME TO THAT CONCLUSION, HAVING ACCESS TO 

COMMUNICATION TECHNOLOGY, PREMIUM COMMUNICATION TECHNOLOGY, 

WE'RE NOT INTERESTED IN LOW END SEGMENTS, THERE ARE MANY OTHER 

COMPANIES THAT DO THAT, AND THAT'S OKAY. 

WE BASICALLY SAID, WHAT IS THE BEST WAY TO DO THAT? SO WE 

HAD A LOT OF DISCUSSIONS ABOUT COULD WE BUILD IT OURSELVES? 

AND WE CAME TO THE CONCLUSION THAT THE RIGHT THING TO DO FOR 

INTEL WAS TO ACQUIRE A COMPANY AND THEN BUILD UPON THAT. 

Q. SO YOU MENTIONED THAT ONCE INTEL ACQUIRED INFINEON, THEY 

WANTED TO TAKE THAT TO A LEADERSHIP POSITION; IS THAT RIGHT? 

A. YES. SO IN THE PROCESS OF DUE DILIGENCE, WE KNEW EXACTLY 

WHAT INFINEON WIRELESS HAD AND DIDN'T HAVE AND WHERE THEY 

STOOD. AND AT THAT POINT IN TIME, THEY'RE -- REMEMBER, THEY 

WERE AN INDEPENDENT COMPANY BASED OUT OF MUNICH -- I WAS GOING 

TO SAY MUNCHANT (SIC) -- MUNICH, GERMANY. 

AND THEIR STRATEGY WAS TO BE A FAST FOLLOWER, MEANING THEY 

LET OTHERS SORT OF DRIVE THE LEADERSHIP OF THESE ADVANCED 

FEATURES IN STANDARDS, WITH TERMINAL EQUIPMENT MANUFACTURERS, 

TEMS, AND WITH OPERATORS, AND THEN THEY CAME IN LATER AND JUST 

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WENT IN COST SCALE. SO THEY DIDN'T CREATE, THEY FOLLOWED AND 

JOINED THE WAVE.

Q. SO WHAT KIND OF INVESTMENT DID IT TAKE FOR INTEL TO MOVE 

INFINEON UP FROM A FAST FOLLOWER? 

A. OH. LOTS OF MONEY, BILLIONS OF DOLLARS, AND AN ARMY OF 

ENGINEERS WORLDWIDE. 

AND THEN A LOT OF FOCUS. 

Q. YOU MENTIONED A BILLION DOLLARS. WHERE DOES ALL THAT 

MONEY GO? 

A. IT GOES TO PAY THE ENGINEERS. THESE ARE VERY EXPENSIVE, 

SPECIALIZED ENGINEERS. HOPEFULLY THEY'LL FORGIVE ME FOR SAYING 

THAT IF THEY KNOW THAT I'VE SAID THAT. 

AND THE TEST EQUIPMENT AND THE EQUIPMENT ITSELF. SO 

BASICALLY THE MAJORITY, I WOULD SAY A GOOD 90 PERCENT OF IT, 

GOES TO THE R&D.

Q. SO THE TIME THAT INTEL ACQUIRED INFINEON, WAS INFINEON 

SUPPLYING APPLE WITH MODEM CHIPS? 

A. YES, THEY WERE. 

Q. AND IMMEDIATELY AFTER INTEL PURCHASED INFINEON, DID INTEL 

CONTINUE SUPPLYING APPLE WITH MODEM CHIPS? 

A. SO -- HMM. WHEN WE ACQUIRED, THROUGH THE PROCESS OF DUE 

DILIGENCE, WE KNEW THAT THEY WERE SUPPLYING TO APPLE. BUT WE 

ALSO KNEW THAT THEY WERE GOING TO LOSE THE SOCKET BECAUSE OF 

THE LACK OF LTE. 

SO, YES, THEY WERE SUPPLYING. BUT IT WAS -- BY THE TIME 

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WE ACQUIRED, IT WAS MORE LEGACY DEVICES, MEANING BELOW LTE, SO 

3G AND BELOW. SO LET'S THINK IPHONE 1, 2, 3. I BELIEVE THEY 

HAD THE 4. 

AND THEN AT 4S, IT SWITCHED TO LTE AND THIS IS WHEN 

QUALCOMM GOT THE SOCKET. 

Q. SO AFTER APPLE SWITCHED OVER TO QUALCOMM, WHAT DID INTEL 

DO? 

A. WELL, FIRST OF ALL, WE KNEW THIS WAS GOING TO HAPPEN, SO 

NO SURPRISE. WE HUNKERED DOWN, WE MADE COMMITMENTS TO THE 

CORPORATION, TO OUR BOARD OF DIRECTORS ABOUT A MULTI YEAR PLAN 

THAT WE WERE GOING TO EXECUTE TO WITH CLEAR MILESTONES AND 

CLEAR SORT OF WHAT WE CALL INSIDE THE CORPORATION PUTTING 

POINTS ON THE BOARD, SORT OF LIKE FOOTBALL YESTERDAY. 

AND WE BASICALLY STARTED EXECUTING TO THAT. 

WE ALSO MAINTAINED THE RELATIONSHIP WITH APPLE. AND SO WE 

WENT THROUGH -- LIKE WHEN YOU ENGAGE WITH THEM, YOU KNOW, 

YOU'RE THERE EVERY DAY. WELL, THE ENGINEERS ARE THERE EVERY 

DAY AND THE EXEC TEAM, YOU'RE THERE ON A WEEKLY BASIS DOING 

STATUS AND WHAT HAVE YOU. 

SO WE -- IT WASN'T WEEKLY, BUT ABOUT EVERY COUPLE OF 

MONTHS WE ENGAGED WITH THEM AND SORT OF SHOWED THEM OUR 

PROGRESS, WHAT WE WERE TRYING TO DO. AND OUR GOAL WAS VERY 

SIMPLE, IT WAS TO TRY AND GET THE SOCKET BACK. 

Q. I WANT TO TALK TO YOU ABOUT A SPECIFIC PORTION IN TIME IN 

2012 DISCUSSIONS BETWEEN INTEL AND APPLE. 

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DID THERE COME A POINT IN 2012 THAT INTEL AND APPLE BEGAN 

DISCUSSING A POTENTIAL APPLE PRODUCT THAT INTEL COULD SUPPLY 

TO. 

A. YEAH. YOU FINALLY GET THAT PHONE CALL THAT YOU HAVE A 

CHANCE, YOU GET INVITED FOR EVALUATION. 

AND SO, YEAH, WE WERE DISCUSSING INTEL BEING A SUPPLIER 

AGAIN. AND THE WAY THEY WORK, YOU NEVER HAVE ANY -- YOU NEVER 

KNOW EXACTLY ALL THE DETAILS, BUT YOU SORT OF GAUGE. AND WE 

MADE IT VERY CLEAR THAT WE HAD -- WELL, THEY MADE IT VERY CLEAR 

THAT WE HAD A CHANCE ON THE IPAD. 

AND WE ALSO MADE IT VERY CLEAR THAT OUR GOAL WAS TO GET 

INTO THE IPHONE. 

BUT YOU ALSO KNOW THAT YOU HAVE TO PASS THAT PIPE CLEANER 

AND THEN GET THE CHANCE AT A VOICE AND GET INTO THE IPHONE, A 

CIRCUIT SWITCH VOICE. 

Q. SO JUST SO WE'RE SPECIFIC, THIS DISCUSSION OF AN IPAD, DO 

YOU HAVE ANY IDEA WHEN THAT IPAD WOULD LAUNCH? 

A. WE -- WE WENT BACK AND FORTH INSIDE OUR HEADS. WE KNEW IT 

WAS '14 OR '15. 

BUT REALLY WHAT WE WERE DRIVING TOWARDS WAS '15 IN OUR 

MINDS BECAUSE OF THE PHONE. BUT WE THOUGHT IT WAS '14 OR '15. 

Q. '14 OR '15 FOR THE PHONE OR THE IPAD? 

A. WELL, YOU KNOW, YOU WERE TALKING ABOUT HOPE AS A STRATEGY, 

RIGHT? SO OF COURSE OUR HOPE AND WISH WAS '14 FOR BOTH. BUT 

WE KIND OF KNEW IT WOULD BE WORST CASE, PUT IT THAT WAY, WORST 

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CASE WOULD BE '14 FOR THE IPAD AND THEN THE PHONE LATER. 

Q. SO YOU MENTIONED THE INITIAL ENGAGEMENT WAS FOR THIS 2014 

PRODUCT POTENTIALLY. 

A. UM-HUM.

Q. HOW DID THE ENGAGEMENT BETWEEN APPLE AND INTEL PROCEED IN 

THE 2012 PERIOD? 

A. IT'S LIKE THAT PAIN YOU ENJOY, KIND OF LIKE EXERCISE. 

YOU -- IT'S GOOD, THE ENGINEERS ARE IN THERE, IN THE BUILDING, 

YOU'RE GETTING -- I SHOULD BE NICE AND NOT SAY ABUSED, BUT 

YOU'RE GETTING, YOU KNOW, LIKE THE INQUIRY AND WHAT'S THE 

STATUS AND COME ON, YOU KNOW, YOU'RE FALLING BEHIND, OR, NO, 

THIS IS GOOD, OR NO, YOU NEED TO ADD THIS. 

SO DEEP TECHNOLOGY ENGAGEMENT, DEEP MANAGERIAL ENGAGEMENT, 

REGULAR BASIS AND ENGINEERS AT BOTH PREMISES. AND WE WERE 

STARTING TO MAKE PROGRESS AND TO SEE SORT OF THEIR REACTION TO 

THE FEATURES, AS WELL AS TO THE DASHBOARDS AND SO ON.

Q. YOU MENTIONED ENGINEERS. DID APPLE PROVIDE INTEL WITH ANY 

ENGINEERING SUPPORT IN THIS 2012 PERIOD? 

A. YES. THERE IS AN APPLE, WE CALL IT ICE TEAM THAT HAS 

SYSTEM ENGINEERS AND WIRELESS ENGINEERS AND, YOU KNOW, DEVICE 

ENGINEERS AND THEY ARE -- YOU'RE WORKING WITH THEM ON THE 

PROJECT AND THEY ARE -- WELL, I CAN'T SAY THAT THEY'RE 

DEDICATED BECAUSE I DON'T WORK THERE. BUT THEY ARE -- 

BASICALLY YOU SEE THEM ON A CONTINUOUS BASIS AND YOU WORK WITH 

THEM CLOSELY.

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Q. DID THIS ENGINEERING SUPPORT HELP APPLE -- EXCUSE ME. 

STRIKE THAT. 

DID THIS ENGINEERING SUPPORT HELP INTEL IN ITS MODEM 

DEVELOPMENT EFFORTS. 

A. OH, YEAH. I MEAN, THEY ARE -- YOU KNOW, ONE OF THE 

EPICENTERS FOR, FOR THE PREMIUM HANDSET, WHICH MEANS FOR THE 

PREMIUM MODEMS. 

AND WHAT HAPPENS IS, FIRST OF ALL, YOU JUST EXECUTE, BUT 

YOU START GAINING EXPERIENCE AND EXPOSURE. YOU ALSO GET WHAT I 

CALL THE HALO EFFECT OF BETTER PRESENCE IN THE STANDARDS, NOT 

JUST PRESENCE, BUT BETTER WEIGHT IN TERMS OF YOUR 

CONTRIBUTIONS, IN TERMS OF STARTING TO GET LEADERSHIP 

POSITIONS. 

SAME THING WITH THE OPERATORS, BECAUSE THESE DEVICES 

EVENTUALLY END UP ON THEIR NETWORK. 

SO DEFINITELY. 

Q. SO OVER THE COURSE OF THE 2012 ENGAGEMENT, DID APPLE EVER 

RAISE ANY CONCERNS WITH INTEL ABOUT INTEL'S ABILITIES TO MEET 

APPLE'S REQUIREMENTS? 

A. WELL, YEAH. I MEAN, IN THE STATUS REPORTS AND THE 

DISCUSSIONS, THEY WERE CONSTANTLY BEATING UP ON US. BUT, 

AGAIN, THAT'S A BEATING THAT YOU TAKE WITH JOY AND PRIDE. 

BUT I THINK THEY KNEW THAT WE WERE COMMITTED, AND THIS IS 

SOMETHING WE REALLY WANTED TO DO. 

REMEMBER, I'M LEADING 7,000 ENGINEERS, BUT 3,000 OF THOSE 

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ENGINEERS, THEY DO KNOW WHAT IT FEELS LIKE AND WHAT HAPPENS 

WHEN YOU SHIP IN THAT DEVICE. 

SO IF YOUR QUESTION IS DID THEY EXPRESS CONCERNS? YES, 

BECAUSE YOU'RE IN EXECUTION AND THINGS ARE GOING BACK AND 

FORTH. 

BUT WERE THEY CONCERNED THAT WE DIDN'T WANT TO BE IN THIS 

BUSINESS OR WE WERE INCAPABLE OF EXECUTING? NO.

Q. DID ANY OF THESE CONCERNS THAT APPLE RAISED GIVE YOU PAUSE 

AS TO WHETHER INTEL WOULD BE READY TO LAUNCH A 2014 DEVICE WITH 

THEM? 

A. DO THE -- SIR. SIR, I'M A GM, RIGHT? I GO TO BED AT 

NIGHT WORRYING ABOUT STUFF THAT'S NOT GOING TO HAPPEN. 

BUT, NO, WE WERE DETERMINED. WHEN THERE WERE PROBLEMS, WE 

FIGURED IT OUT AND GOT THE TEAMS TOGETHER. 

SO WE WERE ABSOLUTELY -- I MEAN, I TOOK THIS PERSONALLY. 

I HAD THIS RESPONSIBILITY AND GETTING TO LAUNCH WAS SOMETHING 

THAT I WAS NOT GOING TO LET NOT HAPPEN. 

Q. DOES INTEL CURRENTLY SUPPLY APPLE WITH CHIPSETS? 

A. YES. 

Q. AND -- 

A. SORRY. I HAD TO THINK ABOUT THE MARCH 2018 THING.

Q. I'LL REFRAME MY QUESTION. THAT'S A GOOD CATCH FOR ME. 

SO IN 2016, DID APPLE -- OR DID INTEL SUPPLY APPLE WITH 

CHIPSETS? 

A. YES. WE -- GREAT DAY FOR INTEL. WE LAUNCHED IN SEPTEMBER 

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'16 FOR THE IPHONE 7. 

Q. AND IN 2017, DID INTEL LAUNCH ANOTHER PRODUCT WITH APPLE? 

A. YES.

Q. WERE THE CONCERNS THAT YOU DISCUSSED IN THIS 2012 PERIOD 

ANY DIFFERENT FROM THE CONCERNS THAT APPLE MAY OR MAY NOT HAVE 

RAISED IN THE 2016 AND 2017 LAUNCHES? 

A. NO. THE BEATINGS, ONCE YOU'RE IN THE SOCKET, THE BEATINGS 

ARE ACTUALLY MORE PROFOUND BECAUSE THE STAKES ARE A LOT HIGHER.

Q. SO AS OF THE END OF 2012, WAS THERE ANY CONCERN IN YOUR 

MIND THAT INTEL WOULDN'T BE READY TO LAUNCH A 2014 APPLE 

PRODUCT? 

A. NO. I KNEW THE TEAMS WOULD EXECUTE. OCCASIONALLY, 

THOUGH, I HAD A FAILURE OR TWO. BUT THAT WASN'T GOING TO BE 

ONE. 

Q. MS. EVANS, DID INTEL ULTIMATELY SUPPLY APPLE FOR A 2014, 

2015 PRODUCT? 

A. NO, WE DID NOT. PROBABLY ONE OF THE WORST DAYS IN MY 

CAREER. IT IS SOMETHING I WILL ALWAYS REMEMBER. 

I GOT A PHONE CALL FROM ISABEL MA, WHO BACK THEN WAS 

RUNNING WIRELESS FOR APPLE, AND SHE BASICALLY GAVE ME A HEADS 

UP THAT WE HAD LOST THE SOCKET. 

AND, YEAH. SO I ASKED, OBVIOUSLY, YOU KNOW, OKAY, WHAT 

HAPPENED? LIKE, WHAT CAN WE DO BETTER? WAS IT THE FEATURES OR 

WAS IT OUR EXECUTION? BECAUSE THIS -- I MEAN, IT WAS A TOTAL 

SHOCK. 

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AND SHE BASICALLY SAID, NO, THAT THAT WASN'T THE REASON. 

THE REASON WAS THAT THEY HAD, THE COMPANY, APPLE, HAD SOME TYPE 

OF BUSINESS AGREEMENT WITH QUALCOMM AND THAT WE WOULD GET A 

CHANCE BACK FOR THE 2016 LAUNCH, WHICH MEANS AN ENGAGEMENT IN 

2015. 

AND SHE ENCOURAGED US TO KEEP GOING AND, YOU KNOW, 

HOPEFULLY SEE EACH OTHER AGAIN IN '15.

Q. SO TO YOUR KNOWLEDGE, WAS THERE ANYTHING ABOUT INTEL'S 

TECHNICAL EXECUTION THAT CAUSED IT TO LOSE THE 2014 PRODUCT? 

A. NO. I MEAN, I KNOW THERE'S A LOT OF SPECULATION OF THAT, 

BUT THAT IS NOT THE INDICATION WE GOT FROM THE TEAM THAT WAS 

DIRECTLY ENGAGED AND THAT WAS MAKING RECOMMENDATIONS TO THE 

MANAGEMENT CHAIN AT APPLE THAT WAS DIRECTLY ENGAGED. 

Q. SO FOLLOWING THE LOSS OF THE 2014 APPLE PRODUCT, DID THE 

LEVEL OF ENGINEERING ENGAGEMENT BETWEEN APPLE AND INTEL CHANGE 

AT ALL? 

A. CAN YOU REPEAT THE QUESTION, PLEASE?

Q. SURE. SO FOLLOWING INTEL'S LOSS FOR THE 2014 APPLE 

PRODUCT, DID THE LEVEL OF ENGINEERING SUPPORT THAT APPLE GAVE 

TO INTEL CHANGE AT ALL? 

A. YEAH. WE WENT BACK TO THE KID'S TABLE IN THE SENSE THAT 

WE DIDN'T HAVE NOW THAT DEEP ENGAGEMENT WITH THEIR ENGINEERS 

AND SO ON AND SO FORTH. 

WE CONTINUED AS A LEADERSHIP TEAM TO GO BACK TO APPLE 

EVERY COUPLE MONTHS OR SO TO, A, SHOW THEM OUR PROGRESS, 

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BECAUSE AT THIS POINT, RIGHT -- FIRST OF ALL, THERE'S A SHOCK 

AT INTEL. AND THIS IS THE FRAGILITY OF THIS THING, RIGHT? WE 

HAD A ROUND OF HAVING TO CONVINCE MCM, AS WELL AS OUR BOARD OF 

DIRECTORS, THAT WE WERE GOING TO FIGURE OUT A WAY AGAIN AND TO 

STAY ON COURSE FOR THE STRATEGY. 

AND SO SINCE THEY HAD TOLD US THAT 2015 WAS GOING TO BE A 

CHANCE AGAIN, WE CONTINUED AS BEST AS WE COULD TO KIND OF STAY 

AFLOAT AND THEN WE CONTINUED OUR RELATIONSHIP IN TERMS OF GOING 

IN AND SHOWING OUR STATUS, AND ALSO TRYING TO FIGURE OUT A WAY 

TO STAY RELEVANT SO THAT WE COULD GET TO 2015 AND GET A CHANCE 

AGAIN. 

Q. SO DID THE LACK OF ENGINEERING SUPPORT FROM APPLE AFFECT 

INTEL'S ABILITY TO DEVELOP MODEM CHIPSETS? 

A. YEAH. IT SET US -- IT DIDN'T KILL US BY THE GRACE OF I 

DON'T KNOW WHO BECAUSE, FRANKLY, IT SHOULD HAVE. 

BUT IT SLOWED US DOWN CONSIDERABLY. FIRST OF ALL, YOU 

KNOW, I HAVE TO GO AND JUSTIFY AND RE-EXPLAIN AND RESET BY TWO 

YEARS. 

IT ALSO SORT OF SLOWED US DOWN IN TERMS OF GETTING TO A 

MORE CREDIBLE POSITION WITH THE OPERATORS, AS WELL AS WITH, 

WITH STANDARDS AND TEMS. 

SO, YEAH, IT SET US BACK TWO YEARS, AND, FRANKLY, IT WAS A 

NEAR-DEATH EXPERIENCE.

Q. SO AFTER THIS LOSS, IF INTEL HAD A CHANCE TO BID ON 

ANOTHER APPLE PRODUCT IN 2014, WOULD IT HAVE DONE SO? 

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A. WITH PLEASURE.

Q. WHAT ABOUT A 2015 PRODUCT. AFTER THIS LOSS, IF INTEL 

COULD BID ON A 2015 APPLE PRODUCT, WOULD IT HAVE DONE SO? 

A. DEFINITELY.

Q. I WANT TO TALK TO YOU NOW ABOUT INTEL'S CURRENT SUPPLY 

WITH APPLE, TAKING INTO ACCOUNT THE MARCH 2018 CUTOFF. 

HAS INTEL'S BASEBAND SUPPLY RELATIONSHIP WITH APPLE BEEN 

BENEFICIAL TO INTEL IN ANY WAYS? 

A. IN MANY, MANY DIFFERENT WAYS. I MEAN, LIKE I SAID, FOR 

US, THIS IS A VERY FRAGILE BUSINESS. BUT THE -- IT'S NOT JUST 

THE BUSINESS IN TERMS OF WE'RE JUST TRYING TO MAKE -- I MEAN, 

OBVIOUSLY WE DON'T WANT TO LOSE MONEY. 

BUT THE -- THIS IS A FOUNDATIONAL CAPABILITY FOR INTEL IN 

TERMS OF ITS GROWTH AND ITS TRANSFORMATION TO DATA CENTRIC. 

LIKE I SAID, EVERYTHING THAT COMPUTES CONNECTS IN SOME WAY. 

AND SO WHEN WE TALK ABOUT 5G, WHICH IS THAT TECHNOLOGY 

THAT'S GOING TO ALLOW MORE THAN HUMAN BEINGS TO CONNECT, BUT 

ALSO THE MACHINES TO READILY CONNECT EFFECTIVELY AND 

EFFICIENTLY AND ALL OF THE TYPES OF DEVICES THAT WE ANTICIPATE 

WILL COME ON TO THE NETWORKS IN THE NEXT DECADE OR TWO, THIS 

REALLY GOT US TO THE TABLE IN TERMS OF STANDARDS, IN TERMS 

OF -- MEANING 3GPP AND IEEE, IN TERMS OF THE OPERATORS, IN 

TERMS OF THE TEMS, THE NOKIA'S AND ERICSSON'S AND COMPANY, AS 

WELL AS IN TERMS OF HAVING AN END-TO-END STRATEGY WITHIN THE 

COMPANY. 

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AND OBVIOUSLY WE LAUNCHED A FEW MODEMS NOW, SO WE'VE ALSO 

LEARNED A LOT ABOUT THE TOPOLOGY AND THE TYPE OF TECHNOLOGIES 

THAT WE WOULD BRING INTO 5G. IT'S HELPED US INNOVATE. 

SOMETHING LIKE MILLIMETER WAIVE, I KNOW THAT WE LIKE TO DO 

REVISIONIST HISTORY AS AN INDUSTRY, BUT THE FACT THAT INTEL HAD 

A CREDIBILITY POSITION WITH APPLE MADE IT WIN THE MILLIMETER 

WAIVE ARGUMENT BECAUSE AT LEAST AT THE BEGINNING, QUALCOMM WAS 

NOT INTERESTED IN THAT INNOVATION BECAUSE IT DIDN'T DIRECTLY 

SERVE THEIR PURPOSE. 

AND SO IT BROUGHT INNOVATION FOR THE WORLD AND FOR THE 

CUSTOMERS. 

SO AS A CREDIBILITY ANGLE, THERE'S US HAVING ACCESS TO THE 

TECHNOLOGY THAT WE CONSIDERED TO BE ESSENTIAL GOING FORWARD AS 

A COMPUTE COMPANY, EVEN IN THE HIGH PERFORMANCE SPACE; AND THEN 

THERE'S INNOVATION FOR CUSTOMERS AND CONSUMERS. 

AND I'M SURE THERE ARE ECONOMISTS WHO ARE MUCH BETTER 

QUALIFIED TO TELL YOU ABOUT THE EFFECTS OF INNOVATION ON, ON 

THE WORLD. 

Q. DOES THE POTENTIAL SCALE THAT APPLE CAN PROVIDE HELP INTEL 

IN ANY WAY? 

A. OH, YES, IT DOES, BECAUSE ONE OF THE MISNOMERS IS THAT 

SOME LIKE TO SAY WHAT'S THE BIG DEAL? THERE'S A STANDARD, GO 

BY THE STANDARD, WHICH IS THOUSANDS AND THOUSANDS OF PAGES, GET 

SOME ENGINEERS, HOPEFULLY THEY ARE REASONABLY SMART, THEY READ 

THE STANDARD, THEY'LL IMPLEMENT WHAT'S IN THE STANDARD AND 

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EVERYTHING WILL BE OKAY. 

WELL, NO, NO, NO. IF YOU IMPLEMENT WHAT'S IN THE 

STANDARD, YOU MAY GET HAPPINESS IN THE LAB AND IN SOME VERY 

CONSTRAINED ENVIRONMENT. BUT BASICALLY IT WILL NOT WORK. 

WHY WILL IT NOT WORK? LIKE THERE ARE PLACES IN MANHATTAN 

WHERE IT'S JUST HECTIC. LOTS OF PEOPLE, ALL WITH HIGH-END 

DEVICES, LOTS OF TRAFFIC. THEY'RE ON THEIR DEVICES CONSTANTLY, 

MEETING THROUGHPUT, LATENCY, SIGNAL NOISE RATIO. 

I SEE IN SILICON VALLEY, THERE'S A SPOT ON 280, I'M SURE 

MOST PEOPLE WHO LIVE AROUND HERE KNOW IT, IT'S BEEN A COUPLE OF 

DECADES, WE STILL HAVEN'T FIGURED OUT WHAT'S GOING ON IN THAT 

SPOT AND A CALL DROPS AND THEN YOU GET BACK ON. 

SO THAT SCALE -- AND I'M ONLY TALKING ABOUT A COUPLE OF 

CITIES IN THE UNITED STATES. 

NOW THINK ABOUT WORLDWIDE. THAT SCALE IS EXTREMELY 

IMPORTANT. 

AND FOR THE OPERATORS, TOO, TO GIVE YOU THAT CREDIBILITY, 

THEY'RE NOT GOING TO GIVE YOU THAT CREDIBILITY BECAUSE YOU HAVE 

ONE PHONE IN THE CORNER OF THE THIRD SHELF THAT NOBODY BUYS. 

Q. EARLIER YOU MENTIONED A HALO EFFECT THAT APPLE COULD 

PROVIDE. SO AFTER INTEL WON THE 2016 APPLE PRODUCT, DID ANY 

COMPANIES REACH OUT TO INTEL ABOUT POTENTIAL SUPPLY? 

A. YES. 

Q. AND WERE THESE COMPANIES THAT HAD REACHED OUT TO INTEL 

BEFORE THE 2016 APPLE LAUNCH? 

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A. NO. 

Q. CAN YOU GIVE US SOME EXAMPLES? 

A. LENOVO IS AN EXAMPLE, LG IS AN EXAMPLE, MOTOROLA IS AN 

EXAMPLE, TESLA IS AN EXAMPLE. 

Q. SO IF INTEL HAD WON THE APPLE SOCKET TWO YEARS EARLIER, 

WOULD IT HAVE BEEN INTERESTED IN PURSUING BUSINESS AT HANDSET 

OEM'S, LIKE SOME OF THE OEM'S YOU NAMED? 

A. YEAH, WE WOULD HAVE BEEN.

Q. AND IF INTEL HAD WON THE APPLE BUSINESS TWO YEARS EARLIER, 

WOULD INTEL HAVE BEEN BETTER STATIONED TO PROVIDE MODEM CHIPS 

TO THOSE OEM'S? 

A. YEAH. WE BELIEVE -- WE BELIEVE THAT WE, WE WOULD HAVE A 

BETTER OPPORTUNITY TO EVALUATE THAT. WOULD WE HAVE PROVIDED 

ALL OF THEM? I CAN'T SAY THAT. BUT WE DEFINITELY WOULD HAVE 

BEEN IN A BETTER POSITION OR IN A BETTER -- IN LESS OF A 

PREDICAMENT AS OPPOSED TO THE FRAGILITY WE HAVE RIGHT NOW THAT 

IS REALLY FORCING US TO FOCUS, FOCUS, FOCUS. 

Q. MS. EVANS, YOU HAVE A BINDER IN FRONT OF YOU OF DOCUMENTS. 

A. YES, I DO.

Q. IF YOU COULD TURN TO THE SECOND TAB, THIS IS CX 1599? 

A. YES. GIVE ME A SECOND. 

Q. SURE. 

A. YES. 

Q. WHAT IS CX 1599? 

A. IT IS AN E-MAIL FROM STEFAN WOLFF, WHICH BACK THEN WAS 

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OUR -- LED THE BUSINESS LINE ON MY TEAM FOR THE PREMIUM 

SEGMENT. 

Q. AND DID YOU RECEIVE A COPY OF THIS E-MAIL? 

A. YEAH. 

MR. CARSON: YOUR HONOR, AT THIS TIME I OFFER CX 1599 

INTO EVIDENCE. 

MR. RYAN: NO OBJECTION, YOUR HONOR. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 1599 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE.

BY MR. CARSON: 

Q. MS. EVANS, I WANT YOU TO LOOK AT THE PARAGRAPH STARTING AT 

THE BOTTOM OF PAGE 1 AND CONTINUING ON TO THE TOP OF PAGE 2. 

DOES THAT PARAGRAPH LAY OUT SOME OF THE BENEFITS IN 

MR. WOLFF'S OPINION OF THE APPLE 1? 

A. YES. AS YOU CAN SEE, IT TALKS -- FIRST OF ALL, IT TALKS 

ABOUT HOW IMPORTANT THEY ARE IN TERMS OF GETTING YOU THE 

CREDIBILITY WITH OPERATORS. 

WITH NETWORK VENDORS, WHICH IS THE SAME AS THE TEMS, THE 

TERM IS INTERCHANGEABLE; WITH FIELD TESTING, WHICH GOES TO 

SALE; IT HELPS YOU, WHAT WE CALL SPEED UP AND HARDEN, BECAUSE 

AS I EXPLAINED EARLIER, JUST BECAUSE IT WORKS IN THE LAB 

DOESN'T MEAN IT'S -- WELL, ACTUALLY, YOU KNOW IT'S NOT GOING TO 

WORK IN THE FIELD. 

AND REALLY GETTING THE I.P. READY, AND I CAN SEE THAT HE 

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WAS EVEN READY TO SAY, AND THEN LET'S GO TO CHINA, MEANING GET 

THAT VOLUME, TOO, AT SOME POINT. YEAH. 

Q. AND DO YOU AGREE WITH MR. WOLFF'S ASSESSMENT THAT THE 

BENEFIT TO INTEL WORKING WITH THAT? 

A. YES, I DO.

Q. THANK YOU, MS. EVANS. YOU CAN PUT THAT DOCUMENT AWAY. 

NOW, IS THERE ANY REASON THAT YOU CAN THINK OF THAT IF 

INTEL HAD WON THE APPLE BUSINESS TWO YEARS EARLIER, THESE 

BENEFITS WOULDN'T HAVE ACCRUED TO INTEL TWO YEARS EARLIER? 

A. NO. I MEAN, "ANY" IS A VARIABLE, BUT, NO, NO REASONABLE 

REASONS. 

Q. DID INTEL DEVELOP MODEM FEATURES IT OTHERWISE WOULD NOT 

HAVE AS A RESULT OF WORKING WITH APPLE? 

A. CERTAINLY WE WOULD NOT HAVE IN THE TIMEFRAME. THERE ARE 

SEVERAL EXAMPLES WHERE WE WERE WORKING WITH THEM AND WE HAD A 

POR, PLAN OF RECORD, OF CERTAIN FEATURES, AND THEY -- IN THEIR 

KIND AND SPECIAL WAY, THEY EXPLAINED THAT THAT WAS NOT GOING TO 

BE GOOD ENOUGH. 

AND SO AN EXAMPLE WAS, FOR EXAMPLE, ON THE 2017 LAUNCH, 

INITIALLY I HAD TO RUN FOR A PLAN OF RECORD OF 450 MEGABITS PER 

SECOND, AND THEY GENTLY EXPLAINED TO ME THAT THAT WASN'T GOING 

TO CUT IT, IT NEEDS TO BE 600. 

SO EVENTUALLY I'M SURE WE WOULD HAVE DONE IT, BUT NOT IN 

THAT TIMEFRAME. 

ALSO, IN TERMS OF POWER CONSUMPTION. ALSO IN TERMS OF 

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WHAT WE CALL BANDS COMBINATIONS. YES, THOSE ARE EXAMPLES.

Q. AND ARE ANY OF THESE FEATURES THAT YOU MENTIONED ABLE TO 

MAKE INTEL'S MODEMS MORE COMPETITIVE FOR OTHER NON-APPLE 

CUSTOMERS? 

A. YES. I MEAN, YOU KNOW, APPLE AND THE U.S. NETWORKS, AND 

HOPEFULLY THAT CONTINUES WITH 5G. I THINK THIS IS IMPORTANT 

FOR ALL OF US. THEY SET THE BASE. AND SO, YEAH, THE SIMPLE 

ANSWER IS YES. 

Q. MS. EVANS, I WANT TO SHIFT A LITTLE BIT AND TALK ABOUT VIA 

TECHNOLOGIES. 

DID INTEL ACQUIRE A COMPANY CALLED VIA TECHNOLOGIES IN 

2015? 

A. YES, WE DID.

Q. AND WHAT IS VIA TECHNOLOGIES? 

A. VIA TECHNOLOGIES IS, OR WAS, I GUESS, A CDMA STANDARD ON 

COMMUNICATION PRODUCT TECHNOLOGY -- SORRY -- PRODUCT TECHNOLOGY 

COMPANY. 

SORRY, YOUR HONOR. 

Q. WHY DID INTEL ACQUIRE VIA? 

A. WE ACQUIRED VIA BECAUSE FINALLY SOME OF US HAD BEEN -- 

THERE HAD BEEN A DEBATE FOR THE LONGEST TIME AT INTEL, EVEN 

PRIOR TO THE INFINEON WIRELESS ACQUISITION, AND DEFINITELY 

AFTER. ALSO, THERE WAS A DEBATE IN THE INDUSTRY. CDMA IS THIS 

TECHNOLOGY THAT IT'S LIKE THE CAT WITH NINE LIVES. IT'S 

SUPPOSED TO BE DEAD ALL THE TIME, BUT IT DOESN'T DIE KIND OF 

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THING. 

SO WE HAD A LOT OF DEBATE ABOUT WHETHER WE SHOULD ACQUIRE 

IT OR NOT. AND FINALLY, WHEN WE GOT THE RE-ENGAGEMENT WITH 

APPLE, I FELT THAT WE HAD ENOUGH CREDIBILITY INTERNALLY AND HAD 

DELIVERED ENOUGH OF OUR PROMISES, POINTS ON THE BOARD, WITH 

RESPECT TO, TO OUR BOARD OF DIRECTORS AND OUR MCM AND CEO AND 

CFO THAT I FELT COURAGEOUS ENOUGH, OR WE FELT COURAGEOUS ENOUGH 

TO GO MAKE THE PITCH AGAIN. SO WE ACQUIRED IT. 

AND THERE ARE LOTS OF NETWORKS, BUT I'LL NAME VERY, LIKE 

TWO VERY IMPORTANT NETWORKS. VERIZON, WHICH HOPEFULLY 

EVERYBODY IS FAMILIAR WITH IN THIS ROOM THAT USES CDMA, AND 

ALSO CHINA TELECOM IN CHINA THAT USES CDMA. 

SO THAT'S WHY WE WENT AND ACQUIRED THAT.

Q. SO ULTIMATELY DID THE FACT THAT INTEL WON APPLE'S BUSINESS 

AFFECT ITS DECISION TO ACQUIRE VIA? 

A. CAN YOU PLEASE REPEAT THE QUESTION?

Q. SURE. SO ULTIMATELY DID THE FACT THAT INTEL ACQUIRED, OR 

WON APPLE'S BUSINESS AFFECT ITS DECISION TO ACQUIRE VIA? 

A. OH, YEAH. THERE WOULDN'T HAVE BEEN A -- I WOULDN'T HAVE 

BEEN -- YEAH, THERE WOULDN'T HAVE BEEN A DISCUSSION. 

Q. SO DID THE LACK OF APPLE'S BUSINESS AFFECT INTEL'S 

DECISION NOT TO ACQUIRE CDMA TECHNOLOGY BEFORE 2015? 

A. WELL, I WANT TO BE MEASURED. IT WAS ONE OF THE FACTORS, 

OBVIOUSLY. I MEAN, IF YOU DON'T HAVE A CUSTOMER, A BIG 

CUSTOMER, YOU DON'T GET TO GO TELL THE COMPANY TO SPEND 

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MILLIONS OF DOLLARS ACQUIRING ANYTHING. 

BUT TO BE FAIR, THERE WERE ALSO OTHER DISCUSSIONS THAT 

WERE GOING ON. SOME BELIEVED THAT CDMA WAS FINALLY GOING TO 

DIE AND -- INCLUDING, BY THE WAY, OTHER PEOPLE WHO USED CDMA. 

THEY HAD DEBATES BACK AND FORTH. 

AND WHAT I WOULD SAY IS THAT WITH APPLE, WE GOT DEEP IN 

THE CHANTER OF THOSE OPERATORS AND WERE ABLE TO HAVE A BETTER 

VIEW AND ULTIMATELY MADE THE CALL THAT WE SHOULD ACQUIRE IT. 

Q. MS. EVANS, I WANT YOU TO TURN IN YOUR BINDER TO THE FIRST 

TAB, CX 1598? 

A. OKAY. JUST ONE SECOND, PLEASE. 

Q. SURE. AND WHILE YOU'RE LOOKING, I WANT TO FOCUS ON THE 

THIRD PAGE. SO -- THE PRESENTATION, THAT SAYS VINE EXECUTIVE 

OFFICE REVIEW? 

A. YES.

Q. WHAT IS THAT PRESENTATION, MS. EVANS? 

A. SO FIRST, VINE -- AT INTEL, WHEN THEY'RE DOING AN M&A, 

BECAUSE YOU'RE DEALING WITH CONFIDENTIAL INFORMATION AND SO ON, 

YOU GET A CODE NAME. SO WINE WAS THE CODE NAME FOR VIA. 

AND THIS PRESENTATION IS ME AND MY TEAM GOING TO OUR 

ESSENTIALLY CEO, BRIAN KRZANICH AT THE TIME; CFO, STACY SMITH; 

AND HEAD OF M&A, WENDELL BROOKS, WHO STILL IS THE HEAD OF 

M&A, AND DOING THE PITCH AND CLOSE ON GETTING APPROVAL TO 

PROCEED TO ACQUIRE VIA TECHNOLOGIES. 

Q. DID YOU HELP PREPARE THIS PRESENTATION? 

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A. YES. 

MR. CARSON: YOUR HONOR, AT THIS TIME THE FTC OFFERS 

CX 1598 INTO EVIDENCE. 

MR. RYAN: NO OBJECTION, YOUR HONOR. 

THE COURT: IT'S ADMITTED. 

(PLAINTIFF'S EXHIBIT CX 1598 WAS ADMITTED IN EVIDENCE.) 

MR. CARSON: YOUR HONOR, I'LL NOTE THIS IS ONE OF THE 

DOCUMENTS THAT YOU SEALED OVER LUNCH. 

THE COURT: THAT'S FINE, AND I WANT YOUR JOINT 

EXHIBIT LIST TO IDENTIFY THE PAGES THAT WILL BE SEALED IN EACH 

DOCUMENT. 

MR. CARSON: YES, YOUR HONOR. 

THE COURT: BECAUSE RIGHT NOW IT SAYS PORTIONS 

SEALED. THAT'S NOT SPECIFIC ENOUGH. THAT'S FOR BOTH PARTIES. 

MR. CARSON: YES, YOUR HONOR. 

THE COURT: THANK YOU.

BY MR. CARSON:

Q. MS. EVANS, I WANT YOU TO TURN TO THE SECOND PAGE OF THE 

PRESENTATION, SO AT DASH 004. AND THERE'S A BULLET IN THE 

MIDDLE THAT SAYS STRATEGIC RATIONALE. 

DO YOU SEE THAT? 

A. YES, I DO.

Q. AND THE SECOND BULLET UNDER THAT SAYS "ADD 6-MODE CDMA 

SOLUTION TO WIN APPLE." 

DO YOU SEE THAT?

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A. YES. 

Q. WHAT DOES THAT MEAN? 

A. THAT MEANS I AM FEELING, OR WE ARE FEELING CONFIDENT AS A 

TEAM THAT WE WILL GET TO THE FIRST LAUNCH, AND WE HAVE NOW 

ASPIRATIONS TO BE ABLE TO SUPPLY TO APPLE WORLDWIDE, WHICH 

WOULD OBVIOUSLY REQUIRE CDMA THAT ESSENTIALLY ON TOP OF THE 

OTHER RADIO ACCESS TECHNOLOGIES, RATS, AND CDMA WAS THE ONE 

MISSING. SO IT WAS SORT OF GETTING THE LAST PIECE OF THE 

PUZZLE THAT WOULD ALLOW US TO HAVE THE PRIVILEGE AND 

OPPORTUNITY TO SUPPLY WORLDWIDE, INCLUDING ON VERIZON.

Q. MS. EVANS, ON THAT SAME PAGE, PAGE 4 OF CX 1598, AT THE 

VERY BOTTOM, THERE IS A LINE, I DON'T WANT YOU TO READ IT ALOUD 

BECAUSE PORTIONS HAVE BEEN SEALED, THAT BEGINNING REQUEST 

APPROVAL. 

DO YOU SEE THAT? 

A. YES, I DO.

Q. IS THE DOLLAR FIGURE IN THAT LINE THE AMOUNT THAT INTEL 

PAID FOR VIA TECHNOLOGIES? 

A. YES, IT IS.

Q. MS. EVANS, I NOW WANT YOU TO TURN TO PAGE 9 OF THE 

EXHIBIT. IT'S PAGE 7 OF THE PRESENTATION. 

A. YES, I AM THERE.

Q. AND YOU SEE IT SAYS VINE VALUATION AT THE TOP; IS THAT 

RIGHT? 

A. THAT IS CORRECT. 

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Q. SO THIS SLIDE HAS BEEN SEALED AS WELL, SO I'LL ASK SOME 

VERY SPECIFIC QUESTIONS. FIRST, THERE'S A SHADED BAR IN THE 

GRAPH AT THE TOP OF THE PAGE THAT SAYS INCREMENTAL CDMA. 

DO YOU SEE THAT?

A. YES, I DO. 

Q. IS THE NUMBER ABOVE INCREMENTAL CDMA IN MILLIONS OF 

DOLLARS, THE TWO DIGIT NUMBER, THE AMOUNT OF VALUE THAT INTEL 

ATTRIBUTED TO NON-APPLE CDMA BUSINESS AS A RESULT OF THE VIA 

TRANSACTION? 

A. THAT IS CORRECT. 

Q. AND THE SHADED BAR RIGHT NEXT TO INCREMENTAL CDMA THAT 

SAYS APPLE INCREMENTAL CDMA, DO YOU SEE THAT?

A. YES, I DO. 

Q. AND THERE'S A NUMBER RIGHT ABOVE THAT, A THREE DIGIT 

NUMBER. IS THAT THE VALUE IN MILLIONS OF DOLLARS THAT INTEL 

ATTRIBUTED TO THE VIA ACQUISITION AS A RESULT OF THE APPLE 

BUSINESS? 

A. YES, THAT IS CORRECT. 

Q. SO, MS. EVANS, WITHOUT THE APPLE BUSINESS, WOULD THE VIA 

ACQUISITION HAVE BEEN ECONOMICALLY JUSTIFIED FOR INTEL? 

A. NO. 

Q. WHY DID INTEL DECIDE TO ACQUIRE VIA TECHNOLOGIES INSTEAD 

OF DEVELOPING CDMA IN-HOUSE? 

A. BECAUSE THERE WAS -- I MEAN, YOU NEED EXPERIENCE, YOU NEED 

TALENT, EXPERTISE, AND AT THIS POINT BASICALLY BUILDING IT FROM 

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SCRATCH WAS NEVER -- WE WERE NOT GOING TO MAKE IT. 

AND SO WE ACQUIRED VIA TECHNOLOGY BECAUSE THAT WAS THE 

ONLY WAY TO GET THE EXPERIENCE, THE EXPERTISE, AND THE CORE 

THAT EVENTUALLY WE WOULD GET THE OPPORTUNITY AND PRIVILEGE TO 

SUPPLY WITHIN OUR MODEM FOR APPLE. 

Q. SO IN INTEL'S CURRENT SUPPLY OF MODEMS TO APPLE, DOES 

INTEL INCUR ANY COST IN DEVELOPING FEATURES SPECIFICALLY TO 

APPLE'S SPECIFICATIONS? 

A. WHEN YOU SAY "CURRENT," ARE WE TALKING ABOUT THE 

DEVELOPMENT WHICH IS BEFORE MARCH 18, OR WHAT ARE WE SAYING? 

Q. BEFORE MARCH 18? 

A. OKAY. I'M -- IF YOU'RE ASKING COSTS THAT ARE SPECIFIC -- 

I MEAN, OBVIOUSLY A LOT -- OUR MODEM DEVELOPMENT IS FOCUSSED 

AROUND APPLE. THIS IS THE PREDICAMENT THAT WE FOUND OURSELVES 

INTO FOR NOW. HOPEFULLY THAT CHANGES BECAUSE HOPEFULLY THESE 

BUSINESS PRACTICES WILL CHANGE. 

BUT WE DON'T REALLY DO A LOT OF -- EVEN IF WE DO SOMETHING 

THAT'S CUSTOM FOR THEM, IT USUALLY FINDS ITSELF IN THE BROADER, 

IN THE BROADER MARKET. 

SO I WOULD SAY THE MAJORITY OF THE DEVELOPMENT, THE R&D, 

IS EVENTUALLY WILL APPLY TO SCALE. 

Q. MS. EVANS, AS OF MARCH 2018 HAD INTEL EVER REQUESTED ANY 

SORT OF EXCLUSIVITY FROM APPLE FOR THE BUSINESS? 

A. NO. WE DON'T -- NO. 

Q. I WANT TO TALK TO YOU A BIT ABOUT MARGINS, AND WITHOUT 

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GETTING INTO SPECIFIC MARGINS SO AS TO AVOID THE NEED FOR 

SEALING THE COURTROOM, ARE THERE GENERALLY TARGET MARGINS IN 

THE INDUSTRY THAT MODEM CHIP SUPPLIERS TRY TO REACH? 

A. GENERALLY, YEAH. I MEAN, AS AN INDUSTRY, IF YOU'RE A GM 

OR A CORPORATION, YOU KNOW, YOU'RE WANTING TO LAND SOMEWHERE -- 

WANTING TO LAND, BECAUSE THEN I'LL GET THE QUESTION THE OTHER 

WAY. 

YOU ARE SATISFIED WITH 45 TO -- 40 TO 50 PERCENT MARGIN, 

UNDERSTANDING THAT SOMETIMES IT'S HIGHER. THAT'S WHY I USED 

THE WORD "SATISFIED." SOMETIMES IT'S LOWER. BUT THAT'S A GOOD 

BALANCE.

Q. SO WHEN INTEL FIRST WON APPLE'S BUSINESS FOR THE 2016 

PRODUCT, WAS INTEL MEETING THOSE MARGIN TARGETS AT APPLE? 

A. NO. 

Q. AND WHAT ABOUT IN THE 2017 APPLE LAUNCH? 

A. NO. 

Q. HAS INTEL EVER ACHIEVED THESE TARGET MARGINS IN ITS SUPPLY 

TO APPLE? 

A. NOT YET. 

Q. SO HAS INTEL'S SUPPLY OF MODEM CHIPS TO APPLE BEEN 

PROFITABLE UP TO THIS POINT? 

A. NO. 

Q. SO AS OF MARGINS THAT INTEL WAS ACHIEVING IN MARCH 2018, 

WOULD THOSE MARGINS BE SUSTAINABLE TO JUSTIFY INTEL'S 

INVESTMENT IN THE INDUSTRY LONG TERM? 

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A. NO. I MEAN, YOU KNOW, THIS HAS BEEN -- LIKE I SAID, WHEN 

WE TALKED TO OUR BODY IN 2010, '11, WE SAID THIS IS GOING TO BE 

A LABOR OF LOVE AND A LONG JOURNEY, MULTI YEAR. WE ARE MAKING 

PROGRESS. THERE'S NO QUESTION ABOUT IT. WE'RE SURVIVING 

COMPETING IN WHAT WE CONSIDER TO BE A PRETTY ROUGH ENVIRONMENT 

WITH THESE BUSINESS MODEL PRACTICES. 

THE STAKES ARE HIGHER. WE'VE MADE PROMISES THAT WE NEED 

TO MEET AND KEEP IMPROVING. WE'RE FOCUSSED IN ORDER TO SORT OF 

MAKE US DO THAT. AND WE HOPE THAT AT SOME POINT IN TIME WE'LL 

BE ABLE TO ACHIEVE THESE MARGINS. 

AND WE'VE HAD TO DO SOME UNNATURAL THINGS, TOO. WHEN I 

SAID AT THE TIME IN 2011, LIKE I SAID, WE WERE BEHIND. SO IF 

YOU'RE IN A RACE AND YOU START THE RACE AND YOU'RE BEHIND, 

YOU'VE GOT TO ROW FASTER, HARDER. YOU'VE GOT TO DO SOMETHING 

DIFFERENT. SO THERE ARE SOME THINGS THAT ARE FUNDAMENTAL IN 

THE BUSINESS THAT WE CONTINUED TO WORK ON OURSELVES. 

THE COURT: I'M SORRY TO INTERRUPT. IT'S 3:34. 

LET'S GO AHEAD AND TAKE A BRIEF BREAK. WHY DON'T WE TAKE A TEN 

MINUTE BREAK. OKAY. SORRY TO INTERRUPT. 

MR. CARSON: THANK YOU, YOUR HONOR. 

THE WITNESS: THANK YOU. WHAT HAPPENS TO ME? DO I 

JUST -- 

THE COURT: YOU CAN STEP DOWN, BUT YOU'LL HAVE TO 

COME BACK IN TEN MINUTES, PLEASE. 

THE WITNESS: THANK YOU. 

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(RECESS FROM 3:35 P.M. UNTIL 3:44 P.M.) 

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

THE WITNESS: THANK YOU. 

MR. CARSON: MAY I PROCEED? 

THE COURT: 3:45. GO AHEAD, PLEASE. 

BY MR. CARSON:

Q. MS. EVANS, WHAT WOULD BE THE EFFECT ON INTEL'S BUSINESS IF 

IT LOST A SINGLE DEVICE CYCLE AT APPLE? 

A. WELL, SO LATER THAN 2012, BUT BEFORE MARCH '18?

Q. YEAH. SO BEFORE MARCH '18, YES. 

A. OKAY. LET ME PUT IT THIS WAY. ONCE YOU'RE IN THE CYCLE 

AND YOU'VE SHIPPED MILLIONS OF UNITS AND YOU HAVE THE SCALE, 

IT'S -- I CALL IT IT'S CHRISTMAS, THERE'S CHRISTMAS EVERY YEAR 

AND YOU CAN'T MISS IT ESSENTIALLY. SO IT'S A YEARLY CYCLE. 

AND YOU HAVE TO MAKE IT EVERY SINGLE TIME. 

I CAN'T THINK OF SOMEBODY IN THE INDUSTRY, EXCEPT FOR THIS 

INFINEON WIRELESS, INTEL, THAT GOT INTO A PREMIUM HIGH VOLUME 

CYCLE AND THEN MISSED A CYCLE AND CAME BACK. THAT WOULD BE NOT 

NEAR DEATH, THAT WOULD BE DEATH. 

MR. CARSON: YOUR HONOR, NO FURTHER QUESTIONS AT THIS 

TIME. 

THE COURT: OKAY. 3:46. 

(PAUSE IN PROCEEDINGS.) 

MR. RYAN: MAY WE HAND OUT BINDER, YOUR HONOR? 

THE COURT: YES, PLEASE. 

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MR. RYAN: ANTONY RYAN FROM CRAVATH REPRESENTING 

QUALCOMM. 

THE COURT: OKAY. THANK YOU. 

THE WITNESS: HI, MR. RYAN. 

MR. RYAN: HOW ARE YOU?

THE WITNESS: I'M DOING WELL. HAPPY NEW YEAR. 

MR. RYAN: SAME TO YOU. 

THE COURT: OKAY. LET ME KNOW WHEN YOU'RE READY. 

MR. RYAN: I'M READY, YOUR HONOR. 

THE COURT: OKAY. 3:46. GO AHEAD, PLEASE. 

CROSS-EXAMINATION

BY MR. RYAN: 

Q. MS. EVANS, GOOD AFTERNOON. 

A. HI. GOOD TO SEE YOU AGAIN.

Q. SAME HERE. 

IN 2011, INTEL ACQUIRED THE MOBILE WIRELESS BUSINESS OF A 

COMPANY CALLED INFINEON; RIGHT?

A. THAT IS CORRECT. 

Q. AND INTEL MADE THIS INFINEON ACQUISITION BECAUSE INTEL 

DECIDED THAT HAVING CELLULAR CAPABILITY WAS ESSENTIAL TO 

INTEL'S WIRELESS BUSINESS; ISN'T THAT RIGHT? 

A. NOT EXACTLY. INTEL DECIDED THAT ACQUIRING CELLULAR AND 

HAVING OTHER WIRELESS TECHNOLOGIES WAS ESSENTIAL TO INTEL'S 

OVERALL STRATEGY, NOT A WIRELESS BUSINESS.

Q. ALL RIGHT. BUT HAVING A CELLULAR MODEM CAPABILITY WAS 

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ESSENTIAL TO INTEL'S OVERALL BUSINESS STRATEGY; RIGHT?

A. THAT IS CORRECT.

Q. AND INTEL DID DUE DILIGENCE INTO INFINEON'S MOBILE 

WIRELESS GROUP BEFORE MAKING THAT ACQUISITION, DIDN'T IT? 

A. YES.

Q. AND YOU WERE PART OF THE TEAM THAT RECEIVED BRIEFING ON 

THAT DILIGENCE, WEREN'T YOU? 

A. YES.

Q. AND AMONG OTHER THINGS, YOU WERE PRIVY TO STATUS REPORTS 

ABOUT INFINEON'S MODEM DEVELOPMENT, WEREN'T YOU? 

A. YES.

Q. AND AS OF THAT TIME, IN 2010 WHEN YOU WERE DOING THIS DUE 

DILIGENCE INTO THE INFINEON MOBILE WIRELESS GROUP, YOU BELIEVED 

THAT INFINEON WAS A COUPLE OF GENERATIONS BEHIND ON LTE, DIDN'T 

YOU? 

A. YES, I'VE TESTIFIED EXTENSIVELY THAT THEY WERE BEHIND AND 

MORE OF A -- NOT JUST BEHIND, BUT HAD A STRATEGY OF BEING A 

FAST FOLLOWER. SO HAD A STRATEGY OF BEING BEHIND.

Q. ALL RIGHT. SO RATHER THAN BEING AN INNOVATOR OR A LEADER, 

INFINEON HAD A CONSCIOUS STRATEGY OF BEING A FAST FOLLOWER; 

RIGHT? 

A. THAT IS TRUE.

Q. AND YOU WERE AWARE -- INTEL WAS AWARE THAT INFINEON WAS A 

COUPLE OF GENERATIONS BEHIND ON LTE; RIGHT?

A. THAT IS TRUE.

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Q. AND AT THAT TIME IN 2010, INFINEON WAS SUPPLYING MODEM 

CHIPS TO APPLE FOR IPHONES, WASN'T IT? 

A. YES.

Q. AND FROM INTEL'S DUE DILIGENCE INTO INFINEON'S MOBILE 

WIRELESS GROUP, YOU KNEW THAT THEY WERE GOING TO LOSE THE APPLE 

SOCKET TO QUALCOMM, DIDN'T YOU?

A. YES. 

Q. AND, IN FACT, AFTER INTEL MADE THAT ACQUISITION, INTEL 

DID, IN FACT, LOSE THE APPLE BUSINESS, DIDN'T IT? 

A. WELL, IN ORDER TO LOSE SOMETHING, YOU HAVE TO HAVE IT. 

AND SO WE -- WHEN WE ACQUIRED INFINEON WIRELESS, WE DIDN'T 

HAVE THE APPLE BUSINESS. WE KNEW THE APPLE BUSINESS, I.E., 

LTE, WAS GONE. 

Q. INFINEON HAD THE BUSINESS BEFORE THE INTEL ACQUISITION; 

RIGHT?

A. YES.

Q. AND APPLE MOVED AWAY FROM INFINEON WHICH THEN BECAME 

INTEL; RIGHT? 

A. YES.

Q. AND YOU UNDERSTOOD THAT THE REASON WHY INTEL LOST THAT 

APPLE BUSINESS WAS BECAUSE INFINEON WAS NOT IN A POSITION OF 

LEADERSHIP AND IT WAS MISSING SOME KEY TECHNOLOGIES; ISN'T THAT 

RIGHT? 

A. YES, WE UNDERSTOOD THAT. SINCE I TESTIFIED THAT PART OF 

WHAT WE HAD TO DO WAS TO SAY, OKAY, IF WE ARE GOING TO NOW 

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TRANSFORM THEM INTO LEADERSHIP WHAT WOULD BE REQUIRED. 

Q. OKAY. SO LET ME MOVE TO LATE 2012. SO THIS IS NOW ALMOST 

TWO YEARS AFTER THE ACQUISITION OF INFINEON MOBILE WIRELESS 

GROUP IN JANUARY 2011. OKAY? 

A. YES.

Q. ALL RIGHT. SO IN LATE 2012, YOU KNEW THAT INTEL WAS STILL 

TWO YEARS BEHIND QUALCOMM ON SHIPPING LTE; ISN'T THAT RIGHT? 

A. SHIPPING? OH, DEFINITELY. WE HAD NOT SHIPPED ANYTHING 

AND QUALCOMM HAD. SO YES.

Q. OKAY. BUT YOU WERE ESTIMATING WHEN INTEL WOULD SHIP, AND 

YOU KNEW THAT THAT WOULD BE AT LEAST TWO YEARS BEHIND QUALCOMM 

ON SHIPPING LTE; RIGHT? 

A. YES.

Q. AND YOU BELIEVED THAT INTEL'S LTE GAP WAS ABOUT INTEL'S 

OWN PRODUCT AND TECHNOLOGY CHOICES, DIDN'T YOU? 

A. NO. I KNEW THAT I CONVINCED THE CORPORATION -- WELL, I 

MAKE IT SOUND LIKE I DO EVERYTHING. THERE'S A TEAM. 

WE HAD AGREED THAT WE NEEDED LEADERSHIP CELLULAR 

CAPABILITY. 

I ALSO KNEW THAT I DON'T DO MIRACLES, SO WE HAD TALKED TO 

THE BOARD AND MCM ABOUT WHAT IT WOULD TAKE, I.E., BILLIONS OF 

DOLLARS, MULTIPLE GENERATIONS, AND FOCUS. 

AND SO THAT'S WHAT I, I KNEW. I KNEW THAT WE WERE DRIVING 

TO GO TO THAT.

Q. OKAY. BUT DIDN'T YOU ALSO BELIEVE THAT INTEL'S LTE GAP 

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WAS ABOUT INTEL'S OWN PRODUCT AND TECHNOLOGY CHOICES? 

A. WELL, YEAH. AT THAT POINT, INFINEON WIRELESS BELONGS TO 

US, SO IF THAT'S WHAT YOU'RE GETTING AT, YES. WE KNEW WHAT WE 

HAD, AND WE KNEW WHAT WAS REQUIRED, I.E., THE BILLION DOLLARS 

OF INVESTMENT, FIGURING OUT HOW TO GET TO A CREDIBILITY TABLE, 

GETTING TO A 5G, GETTING IN A PREMIUM HANDSET SOCKETS. I KNEW 

ALL THAT, YES.

Q. AND IT WAS PRODUCT AND TECHNOLOGY CHOICES THAT INFINEON 

AND INTEL HAD MADE; RIGHT? 

A. NO. IT WAS PRODUCT AND TECHNOLOGY CHOICES THAT INFINEON 

HAD MADE AND THAT NOW INTEL WAS APPLYING, APPLYING WHAT I CALL 

EXTRAORDINARY EFFORTS TO REMEDY. 

Q. BUT IT WAS INTEL THAT PICKED WIMAX AND THEN BOUGHT A 

COMPANY THAT DIDN'T HAVE LTE; ISN'T THAT RIGHT? 

A. WOW. I'M -- NO, THAT'S NOT RIGHT.

Q. OKAY. LET ME SHOW YOU A DOCUMENT. 

A. OKAY.

Q. THIS IS QX 76, SO IF YOU COULD LOOK IN THE BINDER THAT I 

HANDED UP, PLEASE, MS. EVANS. 

A. OKAY. 

Q. IT'S ABOUT A THIRD OF THE WAY IN. THERE'S A TAB, AND THE 

TAB IS AN EXHIBIT? 

A. SO, COUNSEL, FIRST OF ALL, WE'RE GOING TO HAVE TO AGREE ON 

SOMETHING. YOU'RE TALKING VERY FAST, AND ME, I'M A FRENCH 

SPEAKER, SO WE'RE GOING TO HAVE TO SLOW DOWN, ESPECIALLY WHEN 

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IT COMES TO NUMBERS.

Q. ABSOLUTELY. 

A. IF YOU CAN TELL ME -- 

Q. NUMBERS ARE ALWAYS HARD. 

A. YES. 

Q. QX 76? 

A. QX. OKAY. I WAS SEEING CX. OKAY. NOW, I SEE IT. YES, 

YES, UM-HUM. YEAH. 

Q. AND DO YOU SEE THAT STARTING DOWN AT THE BOTTOM OF THE 

FIRST PAGE OF QX 76 AND CONTINUING IN TO THE END, THERE'S AN 

E-MAIL EXCHANGE ON NOVEMBER 7TH, 2012, BETWEEN YOU AND 

BOYD BANGERTER? 

A. YEAH, I KNOW THIS STRATEGY, YES.

Q. OKAY. AND YOU SENT THESE E-MAILS THAT ARE HERE IN QX 76 

THAT ARE UNDER YOUR NAME, DIDN'T YOU? 

A. YEAH. 

MR. RYAN: YOUR HONOR, I OFFER QX 76 INTO EVIDENCE. 

MR. CARSON: NO OBJECTION, YOUR HONOR. 

THE COURT: IT'S ADMITTED. 

(DEFENDANT'S EXHIBIT QX 76 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. RYAN:

Q. ALL RIGHT. AND ON THE SECOND PAGE OF QX 76, ABOUT 

TWO-THIRDS OF THE WAY DOWN DO YOU SEE THAT YOU WROTE, "OUR LTE 

GAP IS ABOUT PRODUCT AND TECHNOLOGY CHOICES"? 

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596

DO YOU SEE THAT? 

A. YES, I DO. 

Q. AND THEN DOWN AT THE BOTTOM OF THE FIRST PAGE OF QX 76, 

THREE LINES FROM THE BOTTOM OF THE PAGE DO YOU SEE YOU WROTE, 

"WE PICKED WIMAX AND THEN BOUGHT A COMPANY THAT DID NOT HAVE 

LTE." 

RIGHT? 

A. YES.

Q. AND THOSE WERE ACCURATE STATEMENTS AT THE TIME YOU WROTE 

THEM IN 2012; RIGHT?

A. OKAY. HOWEVER, COUNSELOR, WE HAVE TO PUT CONTEXT HERE.

Q. NO, WERE THEY -- MA'AM? 

A. NO, NO, NO, NO, NO. 

THERE'S A THREAD OF E-MAIL, SO YOU HAVE TO READ FROM THE 

BOTTOM. SOME RANDOM OTHER ORGANIZATION IN NOVEMBER, WHICH IS 

BUDGET CYCLE, SENDS ME AN E-MAIL WITH ONE THING, HOW FAR BEHIND 

ARE WE FROM SHIPPING LTE. OBVIOUSLY, I KNOW WE HAVEN'T SHIPPED 

ANYTHING BECAUSE WE ARE DEVELOPING IT. I'M LIKE, OKAY, TWO 

YEARS, WHAT'S THE CONTEXT. BECAUSE BASICALLY I'VE BEEN AROUND 

THE BLOCK AS A GM AND I KNOW ESSENTIALLY HE'S TRYING TO GET 

SOME BUDGET, THIS IS INTEL LAB, THE RESEARCH PEOPLE. AND SO -- 

Q. I'M NOT ASKING ABOUT THAT. I'M SIMPLY ASKING WERE THOSE 

ACCURATE STATEMENTS? 

A. YEAH, BUT YOU TAKE THEM OUT OF CONTEXT, AND THEY ARE NOT 

ACCURATE. THAT'S WHY I'M GIVING YOU CONTEXT.

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597

Q. OKAY. BUT THOSE ARE STATEMENTS THAT YOU MADE IN THE 

E-MAILS TO BOYD BANGERTER AT INTEL LABS; RIGHT? 

A. YES. AND REPRESENTING A 20 YEAR PERIOD, YES.

Q. ALL RIGHT. NOW, WAS XMM 7160 THE FIRST LTE MODEM CHIPSET 

THAT INTEL SOLD? 

A. SOLD? DID WE SELL -- HANG ON. I HAVE TO THINK. YEAH, WE 

DID SELL IT TO SOMEBODY, YES.

Q. OKAY. AND DO YOU RECALL THAT IN 2013 SAMSUNG WAS GOING TO 

USE THE INTEL XMM 7160 MODEM CHIP FOR A GALAXY S PHONE AND THEN 

SWITCHED AWAY TO A QUALCOMM CHIP? 

A. YES, I DO RECALL THAT, UM-HUM.

Q. AND THE REASON SAMSUNG GAVE WAS THAT INTEL COULD NOT MEET 

THE SCHEDULE; ISN'T THAT RIGHT? 

A. THAT IS CORRECT. 

Q. ALL RIGHT. AND AROUND THIS SAME TIME IN 2013, MOTOROLA 

DID NOT BUY INTEL LTE MODEM CHIPS EITHER, DID THEY?

A. THAT IS CORRECT. I HAD ACTUALLY DIRECTED OUR SALES TEAM 

TO STOP TAKING THOSE CALLS. BUT, YES, THAT IS CORRECT.

Q. AND DO YOU RECALL THAT INTEL'S CEO AT THE TIME, 

BRIAN KRZANICH, SAID THAT IT WAS NOT -- SAID THAT IT WAS NOT A 

GOOD DAY TO BE FROM INTEL? 

MR. CARSON: OBJECTION. HEARSAY. 

THE WITNESS: UM, NO, I DON'T -- 

THE COURT: SORRY. 

THE WITNESS: I'M SORRY. WHAT AM I SUPPOSED TO DO? 

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THE COURT: THAT'S SUSTAINED. THE QUESTION IS 

STRICKEN. 

MR. CARSON: MOVE TO STRIKE. 

BY MR. RYAN:

Q. LET ME SHOW YOU QX 85, MS. EVANS. 

A. YES. 

Q. IS THIS AN E-MAIL FROM BRIAN KRZANICH TO YOU AND OTHERS 

WITHIN INTEL DATED SEPTEMBER 16, 2013? 

A. YES. 

Q. AND WERE YOU AT THIS TIME THE HEAD OF THE INTEL MOBILE 

WIRELESS GROUP? 

A. YES. 

Q. AND DID YOU LEARN ABOUT A DECISION MOTOROLA MADE NOT TO 

BUY INTEL MODEM CHIPSETS? 

A. YES. IT WAS THE GREATEST DAY OF MY LIFE.

Q. AND DID YOU LEARN ABOUT MOTOROLA'S DECISION NOT TO BUY 

INTEL CHIPSETS FROM THIS E-MAIL FROM MR. KRZANICH? 

A. NO. I KIND OF KNEW THEY WERE GOING TO. IT CONFIRMED THAT 

AND FINALLY SETTLED THE DEBATE AT INTEL. 

MR. RYAN: ALL RIGHT. YOUR HONOR, I MOVE QX 85 INTO 

EVIDENCE. 

MR. CARSON: OBJECTION. HEARSAY. 

MR. RYAN: I'M NOT SEEKING TO ADMIT THIS AS A 

STATEMENT FOR THE TRUTH, BUT RATHER THAT IS A VERBAL ACT, A 

DECISION MOTOROLA MADE NOT TO BUY INTEL CHIPSETS. 

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599

MR. CARSON: I'M NOT QUITE SURE WHAT -- 

THE COURT: SUSTAINED. IT'S NOT COMING IN. GO 

AHEAD. GO TO YOUR NEXT EXHIBIT, PLEASE. 

BY MR. RYAN:

Q. ALL RIGHT. SO YOU SAID THAT THIS WAS A GOOD THING; IS 

THAT RIGHT?

A. YES.

Q. ISN'T IT TRUE THAT INTEL'S CEO SAID THAT THAT DAY WAS NOT 

A GOOD DAY -- 

MR. CARSON: OBJECTION, HEARSAY. 

MR. RYAN: THIS IS OBVIOUSLY IMPEACHING THE WITNESS, 

YOUR HONOR. 

THE COURT: DIDN'T YOU ALREADY ASK THIS QUESTION AND 

I ALREADY SUSTAINED THE OBJECTION? 

MR. RYAN: I WAS TRYING TO LAY A FOUNDATION, YOUR 

HONOR, FOR MY QUESTION. 

THE COURT: I SUSTAINED THE OBJECTION. 

MR. RYAN: ALL RIGHT. I'LL MOVE ON. 

THE COURT: THANK YOU. 

BY MR. RYAN:

Q. NOW, DID YOU WORK FROM TIME TO TIME WITH BAIN & COMPANY -- 

A. EXCUSE ME. AM I SUPPOSED TO DO SOMETHING WITH THIS 

(INDICATING)?

Q. NO. WE'RE MOVING PAST QX 85. 

A. OKAY. UM-HUM.

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600

Q. FROM TIME TO TIME YOU WORKED WITH BAIN & COMPANY 

CONSULTANTS, DIDN'T YOU? 

A. MORE THAN TIME TO TIME, YES.

Q. YOU WORKED FREQUENTLY WITH THEM? 

A. YES. 

Q. ALL RIGHT. COULD I ASK YOU, PLEASE, TO TURN TO QX 92. 

A. QX 92. 

Q. IT'S JUST A COUPLE EXHIBITS BEYOND WHERE WE WERE BEFORE. 

A. OH, SORRY. YES, AT THE BOTTOM. YES, I'M HERE, UM-HUM. 

Q. ALL RIGHT. AND IS THIS AN E-MAIL DATED JULY 7TH, 2015, 

FROM KAYVAN ARDALAN AT BAIN TO VARIOUS INTEL EXECUTIVES, 

INCLUDING YOURSELF?

A. YES. 

Q. AND THEN BEGINNING ON THE FOURTH PAGE OF THE DOCUMENT, DO 

YOU SEE A PRESENTATION BEGINS THAT IS CALLED MOBILE R&D 

BENCHMARKING AND BEARS THE DATE JULY 2015? 

A. YES, I SEE THAT, COUNSELOR.

Q. AND YOU PARTICIPATED WITH BAIN IN CREATING THIS 

PRESENTATION, DIDN'T YOU? 

A. PARTICIPATED IN CREATING IS AN OVERSTATEMENT. I WAS AN 

INPUTTER INTO THE PRESENTATION SINCE THIS WAS BENCHMARKING MY 

UNIT. 

Q. ALL RIGHT. 

YOUR HONOR, I OFFER QX 92 INTO EVIDENCE. 

MR. CARSON: OBJECTION. HEARSAY. 

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601

MR. RYAN: THE WITNESS HAS SAID THAT SHE PROVIDED 

INPUT, SO IT ALSO GOES TO HER STATE OF MIND IN TERMS OF MOBILE 

R&D BENCHMARKING AT THIS OF THE STATE OF COMPETITION. 

MR. CARSON: YOUR HONOR, IF THEY'RE NOT OFFERING THIS 

DOCUMENT FOR THE TRUTH OF THE MATTER ASSERTED, WE'LL WITHDRAW 

THE OBJECTION. 

IF IT'S OFFERED FOR THE TRUTH, WE'LL WITHDRAW THE HEARSAY. 

THE COURT: I'M ACTUALLY GOING TO TODAY, LATER TODAY, 

DENY THE MOTION TO QUASH THE TRIAL SUBPOENA TO CHRIS JOHNSON OF 

BAIN & COMPANY. 

SO WOULDN'T THIS BE COMING IN THROUGH HIM? THIS IS A BAIN 

DOCUMENT; IS THAT RIGHT? 

MR. RYAN: SURE, YOUR HONOR. THE WITNESS HAS 

TESTIFIED IN THE PAST THAT SHE PARTICIPATED IN CREATING THIS 

DOCUMENT. AND I CAN -- I CAN -- 

THE COURT: WELL, WE'LL HAVE IT ADMITTED NOT FOR ITS 

TRUTH. 

MR. RYAN: OKAY. THANK YOU, YOUR HONOR. 

THE COURT: OKAY. GO AHEAD, PLEASE. 

(DEFENDANT'S EXHIBIT QX 92 WAS ADMITTED IN EVIDENCE.) 

BY MR. RYAN:

Q. IF YOU COULD TURN, PLEASE, TO SLIDE 2. THIS IS THE PAGE 

ENDING IN BATES NUMBER 508.

AND YOU AGREED AT THE TIME IN 2015, MS. EVANS, WITH THE 

STATEMENT THAT INTEL AND QUALCOMM INVESTMENT IN MOBILE SOC HAS 

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602

BEEN ON PAR, BUT QUALCOMM PRODUCT OUTPUT IS 2 TO 3 TIMES INTEL; 

RIGHT? 

A. YEAH, I ACCEPTED THIS STATEMENT AS FACT GIVEN THE -- LIKE 

THE NUMBERS, YES. 

Q. AND THAT ACTUALLY WAS A STATEMENT THAT YOU AGREED WITH AT 

THE TIME, WASN'T IT? 

A. I AGREED WITH THE FACT. 

Q. OKAY. 

A. YES.

Q. AND YOU ALSO AGREED AT THE TIME WITH THE FOURTH BULLET 

POINT ON THE SAME PAGE THAT INTEL OVERALL MOBILE PRODUCT 

ACTIVITY STILL LAGS QUALCOMM BY APPROXIMATELY 50 PERCENT? 

YOU AGREED WITH THAT AS WELL, DIDN'T YOU? 

A. I AGREED WITH THE -- I DIDN'T -- WELL, I AGREED WITH THE 

FACTS HERE, WHICH IS HOWEVER INTEL MOBILE PRODUCT ACTIVITY 

STILL LAGS QUALCOMM BY 50 PERCENT, LARGELY DRIVEN, BECAUSE THAT 

HAS NOTHING TO DO WITH THE MODEM, BY INTEL SUPPORTING MULTIPLE 

ARCHITECTURES.

Q. ALL RIGHT. BUT YOU AGREE WITH THAT FOURTH BULLET POINT? 

YOU AGREED WITH THAT STATEMENT, DIDN'T YOU? 

A. I AGREED WITH THE STATED FACTS. I DON'T AGREE WITH THE 

INFERENCE. 

Q. ALL RIGHT. LET'S TURN TO THE NEXT PAGE, PLEASE, SLIDE 3. 

THIS PAGE SHOWS MOBILE ENGINEERING HEAD COUNT. 

NOW, INTEL'S MOBILE ENGINEERING HEAD COUNT IS ON THE LEFT; 

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603

RIGHT. 

A. UM-HUM.

Q. AND AT THIS TIME IN 2011 TO 2015, INTEL WAS INVESTING 

FURIOUSLY, WASN'T IT? 

A. YES, WHICH IS WHERE THAT COMES FROM. WHEN YOU'RE FAR 

BEHIND AND YOU'RE INVESTING FURIOUSLY WITH A COMPETITOR THAT 

HAS THE BUSINESS PRACTICES THAT FOCUS ON KEEPING YOU OUT, YOU 

TEND TO DO UNNATURAL THINGS, YES.

Q. AND INTEL WAS INCREASING ITS MOBILE H & D HEAD COUNT; 

RIGHT? 

A. OH, YES. WE WERE -- WHAT WE NEED -- WHEN COMPARED TO THE 

COMMITMENT WE MADE TO THE BOARD, WE HAD TO SAY WHAT WE NEEDED 

AND WENT AND GOT IT.

Q. AND THIS SLIDE SHOWS THAT INTEL'S MOBILE ENGINEERING HEAD 

COUNT WAS ROUGHLY ON PAR WITH QUALCOMM'S, DOESN'T IT?

A. YES, WE WERE STARTING TO SPEND ABOUT THE SAME, YES.

Q. LET'S TURN, PLEASE, NEXT TO PAGE, SLIDE 4. 

AND WE'RE HERE ON THE SLIDE ENTITLED INTEL LAGGING IN 

PRODUCT OUTPUT. 

AND DOES THIS SLIDE CONFIRM WHAT WE SAW PREVIOUSLY ON 

SLIDE 2, THAT INTEL'S PRODUCT OUTPUT WAS LAGGING QUALCOMM'S? 

A. YES. AND TO BE VERY, VERY CLEAR, BECAUSE SOMEBODY WHO 

READS THIS WON'T UNDERSTAND THE CODE NAME, THIS REPRESENTS 

APPLICATION PROCESSOR AND MODEM DEVELOPMENT THROUGHOUT THE 

CORPORATION, YES. 

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Q. OKAY. AND INTEL WAS LAGGING QUALCOMM IN PRODUCT OUTPUT AT 

THIS TIME; RIGHT? 

A. YES, WHEN IT COMES TO APPLICATION PROCESS PLUS MODEM 

DEVELOPMENTS. THIS IS NOT A COMPARISON OF THE MODEM ITSELF.

Q. ALL RIGHT. LET ME ASK YOU SOME MORE QUESTIONS ABOUT THAT. 

WE'RE ALL SET WITH THIS DOCUMENT. 

A. OKAY.

Q. APART FROM APPLE, MOST HANDSET MAKERS PURCHASE MODEMS WITH 

INTEGRATED APPLICATION PROCESSOR, DON'T THEY? 

A. APART FROM QUALCOMM -- APART FROM APPLE, MOST HANDSET 

MANUFACTURERS PURCHASE MODEMS FROM QUALCOMM, WHO MAINLY OFFERS 

THEM, EXCEPT FOR SAMSUNG AND APPLE, AS INTEGRATED SOC'S. 

Q. SO APART FROM APPLE, MOST HANDSET MAKERS PURCHASE MODEMS 

WITH INTEGRATED APPLICATION PROCESSOR; RIGHT? 

A. THE ONLY COMPANY THAT OFFERS THEM PREFERS TO SELL SOC'S, 

I.E., QUALCOMM.

Q. MEDIATEK ALSO SELLS SOC'S, DOESN'T IT? 

A. WE SELL PREMIUM.

Q. I DIDN'T ASK ABOUT PREMIUM. ISN'T IT THE CASE THAT APART 

FROM APPLE, MOST HANDSET MAKERS, WHETHER THEY BUY FROM QUALCOMM 

OR SOMEBODY ELSE, PURCHASE MODEMS WITH INTEGRATED APPLICATIONS 

PROCESSORS, ISN'T THAT RIGHT, MS. EVANS?

A. OKAY, THAT'S CORRECT.

Q. AND THOSE ARE OFTEN KNOWN AS SYSTEMS ON A CHIP, OR SOC'S; 

RIGHT? 

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A. IN OUR INDUSTRY THEY ARE, THOUGH, THAT'S A MISNOMER 

BECAUSE SOC REFERS TO SUM OF CONSENT, ACTUALLY. SYSTEM ON A 

CHIP OR SOME OF CONTENT. FOR HANDSETS, THAT IS TRUE.

Q. OKAY. HOWEVER, THEY ARE GENERALLY KNOWN AS SOC'S; RIGHT? 

A. YES. BUT I'M TRYING TO BE VERY PRECISE. NOT ALL SOC'S 

HAVE MODEMS. INTEL SHIPS HUNDREDS OF MILLIONS OF SOC'S THAT 

DON'T HAVE MODEMS IN THERE.

Q. THANK YOU. AND THESE SOC'S THAT HANDSET OEM'S BUY ARE 

DISTINCT FROM THE THIN MODEMS THAT APPLE BUYS; RIGHT? 

A. YES.

Q. AND INTEL USED TO HAVE A MOBILE SOC DEVELOPMENT PROGRAM, 

DIDN'T THEY? 

A. YES, THEY DID OR WE DID. 

Q. AND INTEL'S MOBILE SOC PROGRAM FAILED, DIDN'T IT? 

A. YES, IT DID.

Q. AND INTEL ABANDONS MOST OF ITS MOBILE SOC PROJECTS IN 

2016; ISN'T THAT RIGHT? 

A. YES, THAT IS CORRECT. WE WERE HAVING A HELL OF A TIME NOT 

WITH THE INTEGRATION, WE DIDN'T HAVE A SUCCESSFUL APPLICATION 

PROCESSOR FOR HANDSETS. IT'S KIND OF HARD TO INTEGRATE 

SOMETHING YOU DON'T HAVE. 

Q. AND INTEL DOES NOT CURRENTLY HAVE A MOBILE SOC DEVELOPMENT 

PROGRAM, DOES IT? 

A. NO. THAT IS NOT SOMETHING WE'RE CURRENTLY INTERESTED IN. 

Q. OKAY. IN FACT, YOU BELIEVE INTEL SHOULDN'T BE BROADLY IN 

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THE HANDSET BUSINESS; ISN'T THAT RIGHT? 

A. WHOA. REPEAT THE QUESTION, PLEASE.

Q. ISN'T IT A FACT THAT YOU BELIEVE THAT INTEL SHOULDN'T 

BROADLY BE IN THE HANDSET BUSINESS?

A. THAT IS MY OPINION, MY PERSONAL OPINION, YES. 

Q. IN FACT, YOU'RE NOT INTERESTED IN THE SMARTPHONE MARKET AT 

ALL, ARE YOU, MA'AM? 

A. I AM NOT INTERESTED -- WELL, MA'AM? -- I AM NOT INTERESTED 

IN THE APPLICATION PROCESSOR SIDE OF THE SMARTPHONE MARKET, 

ONE. 

AND, TWO, I AM ONLY INTERESTED IN THE PREMIUM SEGMENT OF 

SMARTPHONES FOR MODEMS.

Q. OKAY. AND SO YOU DISAGREE WITH THE VIEW THAT INTEL SHOULD 

TRY TO SELL A BROADER RANGE OF CHIPS FOR USE IN SMARTPHONES; IS 

THAT RIGHT? 

A. WHAT TYPE OF CHIPS? CAN YOU BE PRECISE, PLEASE? BECAUSE 

OBVIOUSLY PREMIUM MODEM CHIPS I DON'T DISAGREE -- I AGREE WE 

SHOULD DO. 

Q. WELL, FOR INSTANCE, HIGH TIER SOC'S. YOU DISAGREE THAT 

INTEL SHOULD BE TRYING TO SELL HIGH TIER SOC'S FOR USE IN 

SMARTPHONES; ISN'T THAT RIGHT? 

A. NO, THAT'S NOT RIGHT BECAUSE I DON'T KNOW WHAT YOU MEAN BY 

SOC. SO I WILL BE PRECISE. I DO NOT AGREE THAT INTEL SHOULD 

SPEND ITS ENERGY AND TIME IN SOC'S THAT CONTAIN AN APPLICATION 

PROCESSOR. 

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607

Q. OKAY. AND YOU HAVE TESTIFIED, HAVEN'T YOU, THAT YOU 

DISAGREE WITH THE VIEW THAT INTEL SHOULD TRY TO SELL A BROADER 

RANGE OF CHIPS FOR USE IN SMARTPHONES? 

A. THAT CONTAINS AN APPLICATION PROCESSOR, CORRECT. 

Q. OKAY. NOW, LET ME ASK YOU TO LOOK IN YOUR BINDER AT 

QX 89. THIS IS A DOCUMENT THAT WE'RE NOT GOING TO BE 

PROJECTING ON THE SCREEN AT ALL. IT'S SUBJECT TO INTEL'S 

SEALING MOTION? 

A. YES.

Q. LET ME ASK YOU, MS. EVANS, ABOUT QX 89. 

A. UM-HUM. 

Q. DO YOU SEE THAT AFTER A COVER E-MAIL TO YOU, THIS IS A 

WHITE PAPER CALLED MOBILE BEST IN CLASS 14 NANOMETER WHITE 

PAPER? 

A. YES.

Q. AND YOU ARE A PRIMARY AUTHOR OF THIS WHITE PAPER, ARE YOU 

NOT? 

A. I WROTE IT, YES. OR I LED WRITING IT. THERE'S A TEAM, 

YES.

Q. ALL RIGHT. 

YOUR HONOR, I OFFER QX 89 INTO EVIDENCE. 

MR. CARSON: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(DEFENDANT'S EXHIBIT QX 89 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

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608

BY MR. RYAN:

Q. AND THIS WHITE PAPER DOCUMENTS WHY YOU BELIEVED THAT 

INTEL'S PROGRAM FOR MOBILE SOC'S FOR HANDSETS DIDN'T WORK, 

DOESN'T IT? 

A. I BELIEVED THAT WHEN IT CAME TO THE APPLICATION PROCESSOR 

SIDE, AS WELL AS TO BUILDING FOR THIS TYPE OF SEGMENT OUTSIDE 

OF THE MODEM, WE LACKED SOME FUNDAMENTAL -- WE HAD SOME 

FUNDAMENTAL GAPS AND THAT THEY ALSO WERE NOT GOING TO ADVANCE 

WHAT WE WERE TRYING TO DO ON THE MODEM SIDE.

Q. OKAY. AND DOES THE QX 89 WHITE PAPER DOCUMENT THE REASONS 

WHY YOU BELIEVED THAT INTEL'S PROGRAM FOR MOBILE SOC'S FOR 

HANDSETS FAILED? 

A. THIS DOCUMENT -- THIS WHITE PAPER I AND MY TEAM AUTHORED 

DOCUMENTS WHY WE WERE HAVING TROUBLE BUILDING MOBILE 

APPLICATION PROCESSORS AND ADDITIONAL CHIPS FOR HANDSET 

SEGMENTS.

Q. OKAY. THANK YOU. 

A. MEANING IT HAD NOTHING TO DO WITH THE MODEM BASICALLY.

Q. ON DIRECT, YOU TESTIFIED ABOUT LG AND MOTOROLA. 

DO YOU RECALL THAT? 

A. I DO. 

Q. OKAY. NOW, AS OF MARCH OF 2018 WHEN I ASKED YOU QUESTIONS 

AT YOUR DEPOSITION, LG WAS NOT ON YOUR PRIORITY LIST; ISN'T 

THAT RIGHT? 

A. OKAY. SO I -- I HAVE A QUESTION. WE'RE ABOUT TO GO INTO, 

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609

LIKE, CUSTOMERS AND, AND THERE ARE A LOT OF PEOPLE IN THIS 

COURTROOM AND WE'RE ON THE CONFIDENTIAL RECORD. 

SO I'M GOING TO TRUST THAT YOU KNOW WHERE YOU'RE GOING. 

THE COURT: ACTUALLY, WE'RE NOT ON A CONFIDENTIAL 

RECORD. THIS PART IS PUBLIC. 

THE WITNESS: OH, IT IS PUBLIC? 

THE COURT: YEAH. 

THE WITNESS: OKAY. SO WHAT WAS YOUR QUESTION? 

BY MR. RYAN:

Q. AND SO I'M NOT ATTEMPTING TO GET INTO ANY SPECIFIC CHIPS, 

ANY SPECIFIC PRICES, ANY SPECIFIC NEGOTIATIONS EVEN. 

I'M JUST ASKING ISN'T IT THE CASE, MS. EVANS, THAT AS OF 

MARCH 2018, LG WAS NOT ON YOUR PRIORITY LIST? 

A. THAT IS CORRECT. 

Q. AND AT THAT TIME, INTEL WAS NOT TRYING TO SELL BASEBAND 

MODEM CHIPSETS TO LG FOR USE IN PREMIUM SMARTPHONES, WAS IT? 

A. THAT IS CORRECT.

Q. AND SIMILARLY AT THAT TIME IN MARCH OF 2018, MOTOROLA WAS 

NOT A PRIORITY FOR INTEL, WAS IT? 

A. THAT IS CORRECT. 

Q. ALL RIGHT. LET ME ASK YOU SOME QUESTIONS, PLEASE, ABOUT 

CDMA. 

A. OKAY. 

Q. SO IN 2011, AFTER INTEL ACQUIRED INFINEON MOBILE WIRELESS 

GROUP, THERE WAS A DEBATE WITHIN INTEL, WASN'T THERE, REGARDING 

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WHETHER INTEL SHOULD EITHER ACQUIRE OR OTHERWISE DEVELOP CDMA 

CAPABILITY; RIGHT? 

A. YES. THAT WAS IN THE -- THERE WAS A DEBATE IN INTEL AND 

IN THE INDUSTRY, AND INTEL, IN INTEL FOR SURE. 

Q. AND SOME PEOPLE THOUGHT CDMA CAPABILITY WAS UNNECESSARY 

BECAUSE THE TECHNOLOGY WOULD BE PHASED OUT; ISN'T THAT RIGHT? 

A. MOST PEOPLE THOUGHT THAT, YES.

Q. OKAY. YOU BELIEVED THAT CDMA WOULD LAST AS A LEGACY 

TECHNOLOGY AS PART OF A MULTIMODE CHIPSET, DIDN'T YOU? 

A. THAT WAS MY BELIEF, YES.

Q. AND YOU CONCLUDED BACK IN 2011 THAT INTEL NEEDED TO HAVE 

ACCESS TO CDMA; RIGHT? 

A. CONCLUDED? I ARGUED THAT WE SHOULD, YES.

Q. OKAY. SO YOU ADVOCATED THE VIEW INTERNALLY WITHIN INTEL 

THAT INTEL NEEDED TO HAVE ACCESS TO CDMA; RIGHT? 

A. YES. 

Q. AND, IN FACT, YOU RECOMMENDED IN 2011 THAT INTEL SHOULD 

ACQUIRE CDMA CAPABILITY; RIGHT? 

A. YES. I RECOMMENDED THAT BECAUSE AS I FELT MORE AND MORE 

CONFIDENT THAT WE WERE GOING TO BE ABLE TO SHIP TO APPLE, WHICH 

MOST PEOPLE DIDN'T THINK WE WOULD BE ABLE TO DO, I WANTED TO 

LAY THE GROUND WORK AND FOUNDATION SO THAT WHEN WE PULLED THE 

TRIGGER, I HAD ALREADY PREPARED THE COMPANY. 

Q. OKAY. 

A. SO YES. 

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Q. BUT THIS WAS EVEN BACK IN 2011 OR 2012 THAT YOU 

RECOMMENDED THAT INTEL ACQUIRE CDMA CAPABILITY FROM VIA 

TELECOM; RIGHT? 

A. YES. I'M A GM. REMEMBER, I HAVE TO WORRY ABOUT THIS 

YEAR, NEXT YEAR, THE FOLLOWING YEAR. 

Q. UM-HUM. 

A. AT ANY POINT IN TIME, YOU HAVE THE DEVICE THAT YOU ARE 

WORKING ON, HOPEFULLY THE DEVICE THAT IS SHIPPING, AND THE 

DEVICE YOU'RE PREPARING. 

AND SINCE I WAS PLANNING FOR SUCCESS, AND I KNEW IT WAS 

GOING TO BE HARD TO CONVINCE BECAUSE, AS YOU ASKED YOUR 

QUESTION, MOST PEOPLE DIDN'T AGREE WITH ME, IN THIS THESE BIG 

CORPORATIONS, YOU HAVE TO TAKE YOUR TIME AND MAKE SURE. IF I 

WAITED UNTIL I NEEDED IT TO ASK FOR IT, IT WOULD HAVE BEEN TOO 

LATE.

Q. AND INTEL'S THEN CEO, PAUL OTELLINI, WAS GENERALLY NOT 

SUPPORTIVE; ISN'T THAT RIGHT? 

A. MAY HE REST IN PEACE, NO, HE WASN'T. THOUGH I'M SURE HE 

NOW IS. 

(LAUGHTER.) 

BY MR. RYAN:

Q. AND INTEL MADE A BUSINESS DECISION, DIDN'T IT, NOT TO 

ACQUIRE CDMA CAPABILITY FROM VIA TELECOM AT THIS TIME? 

A. YEAH. YOU'RE AN EXECUTIVE. YOU'VE GOT TO LEARN TO WIN 

SOME AND LOSE SOME. AT THAT POINT IN TIME, I DID NOT CONVINCE 

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HIM TO. BUT EVENTUALLY, AS YOU KNOW, SINCE WE ACQUIRED VIA, IT 

TOOK ME THREE YEARS, FOUR YEARS, YES, WE DID. BUT FRANKLY, THE 

TIMING WORKED OUT BECAUSE WE NEEDED TO SHIP FIRST.

Q. YEAH. NOW, IN OCTOBER OF 2014, INTEL SECURED A DESIGN WIN 

TO SUPPLY MODEM CHIPS FOR THE 2016 IPHONES; ISN'T THAT RIGHT?

A. THAT IS CORRECT. 

Q. AND AS A RESULT, INTEL SUPPLIED MODEM CHIPS FOR ROUGHLY 

HALF OF THE IPHONES RELEASED IN THE FALL OF 2016, DIDN'T IT? 

A. THAT IS CORRECT. 

Q. AND THE INTEL CHIPSET THAT WON THE APPLE BUSINESS, THE XMM 

7360 DID NOT HAVE CDMA CAPABILITY, DID IT? 

A. NO, IT DID NOT.

Q. OKAY. SO INTEL WON APPLE BUSINESS, APPLE IPHONE BUSINESS, 

EVEN THOUGH IT DIDN'T HAVE CDMA CAPABILITY AT THAT TIME; RIGHT? 

A. YES. WE WON SOME OF THE APPLE BUSINESS. BUT WE COULD NOT 

COMPETE YET FOR THE PART OF THE APPLE BUSINESS THAT REQUIRED 

CDMA. 

AND APPLE WAS ALSO HAVING ITS OWN DEBATES ABOUT, LIKE WE 

ALL WERE IN THE INDUSTRY, ABOUT CDMA.

Q. INTEL OBTAINED ROUGHLY HALF OF APPLE'S IPHONE BUSINESS 

WITHOUT CDMA CAPABILITY; RIGHT? 

A. CORRECT, IN ABSOLUTE NUMBERS. BUT YOU HAVE TO COMPUTE OUT 

OF WHAT INTEL COULD COMPETE OUGHT OF, AND I WANT TO BE VERY 

CRISP AND CONCISE AND PRECISE THAT WE COULD NOT COMPETE FOR 

PARTS THAT CONTAINED CDMA SINCE WE DIDN'T HAVE IT.

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Q. AND THE REASON FOR THAT WAS THAT INTEL HAD MADE A BUSINESS 

DECISION IN 2011 NOT TO ACQUIRE CDMA TECHNOLOGY; ISN'T THAT 

RIGHT?

A. THE REASON FOR THAT WAS THAT, A, I HAD NOT BEEN SUCCESSFUL 

YET IN CONVINCING THAT WE HAD EARNED THE RIGHT -- NOT THE 

RIGHT -- THE OPPORTUNITY TO GET CDMA. 

AND ONCE WE SHIPPED IN THE IPHONE 7, THAT GAVE US A LOT OF 

CREDIBILITY IN TERMS OF OUR COMMITMENTS AND POINTS ON THE BOARD 

AND WE GOT CDMA. 

Q. AT THAT POINT, YOU WERE ABLE TO WIN OVER OTHER INTEL 

SENIOR EXECUTIVES TO MAKE A DIFFERENT DECISION; RIGHT? 

A. YEAH. 

Q. NOW, INTEL ALSO WON THIS APPLE IPHONE BUSINESS WITHOUT 

FIRST BEING IN AN APPLE IPAD; ISN'T THAT RIGHT? 

A. YEP, THAT IS CORRECT. 

Q. AND YOU WROTE AN E-MAIL WHICH YOU SENT TO YOUR TEAM AT THE 

TIME STATING THAT INTEL DID WHAT NEEDED TO BE DONE TO GET THE 

SOCKET AND START A FAIR AND SQUARE COMPETITION WITH QUALCOMM; 

ISN'T THAT RIGHT?

A. I WRITE THOUSANDS OF E-MAILS. SO IF YOU'RE GOING TO TALK 

ABOUT AN E-MAIL, YOU HAVE TO SHOW ME. BECAUSE I WRITE A LOT OF 

E-MAILS.

Q. OKAY. LET ME SHOW YOU QX 94, MS. EVANS. 

A. 94, YEAH. 

Q. AND I'M NOT GOING TO ASK YOU ABOUT ANYTHING ON THE FIRST 

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THREE PAGES, WHICH WERE SUBJECT TO AN INTEL SEALING MOTION. 

A. WAIT, WAIT. SO THIS IS -- OH, SEPTEMBER '16, YEAH, 

UH-HUH.

Q. DO YOU SEE AT THE VERY BOTTOM OF THE THIRD PAGE AN E-MAIL 

BEGINS THAT'S FROM YOU, DATED WEDNESDAY, AUGUST 10TH, 2016. 

A. UM-HUM. 

Q. ALL RIGHT. IF YOU COULD TURN TO THE NEXT PAGE, THE FOURTH 

PAGE OF QX 94. 

A. YES.

Q. THIS PAGE IS NOT SUBJECT TO A SEALING MOTION. 

AND DO YOU SEE THERE IN THE THIRD PARAGRAPH OF YOUR 

E-MAIL, THE PARAGRAPH THAT BEGINS I STAND BY THE STATED 

STRATEGY, DO YOU SEE THAT YOU WROTE, WE HAVE DONE THIS, 

INCLUDING WHAT NEEDED TO BE DONE TO GET THE SOCKET AND START A 

FAIR AND SQUARE COMPETITION WITH Q. 

DO YOU SEE THAT, MA'AM? 

A. I'M GOING TO READ THE WHOLE THING SINCE YOU ARE READING 

ONLY PORTIONS OF IT. I STAND BY THE STATED STRATEGY TO FIRST 

EARN THE BUSINESS AS THE ONLY REALISTIC AND PROVEN ALTERNATIVE 

TO QUALCOMM, THE INCUMBENT. WE HAVE DONE THIS, INCLUDING WHAT 

NEEDED TO BE DONE, TO GET THE SOCKET AND START A FAIR AND 

SQUARE, START A FAIR AND SQUARE COMPETITION WITH QUALCOMM.

Q. AND THAT IS WHAT YOU WROTE AND SENT TO YOUR TEAM IN AUGUST 

OF 2016; RIGHT? 

A. YES. 

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MR. RYAN: YOUR HONOR, I OFFER QX 94 INTO EVIDENCE. 

MR. CARSON: NO OBJECTION. 

THE COURT: IT'S ADMITTED. 

(DEFENDANT'S EXHIBIT QX 94 WAS ADMITTED IN EVIDENCE.) 

THE COURT: GO AHEAD, PLEASE. 

BY MR. RYAN:

Q. INTEL ENDED UP ACQUIRING THE CDMA TECHNOLOGY FROM VIA 

TELECOM IN 2015; ISN'T THAT RIGHT? 

A. YES. 

Q. AND INTEL RELEASED ITS FIRST MULTIMODE LTE AND CDMA 

CHIPSET THIS YEAR, THE XMM 7560; ISN'T THAT RIGHT? 

A. THEY TOLD ME. 

MR. CARSON: YOUR HONOR. 

THE WITNESS: YOU ALL AGREED TO MARCH '18. SO NOW 

YOU'RE ASKING ME FOR SOMETHING THAT'S AFTER MARCH '18. SO YOU 

ALL HAVE TO DISCUSS AND TELL ME WHAT TO DO. 

BY MR. RYAN:

Q. AS OF MARCH OF 2018, YOU KNEW THAT INTEL WOULD BE 

RELEASING ITS FIRST MULTIMODE LTE CDMA CHIPSET THIS YEAR, 

DIDN'T YOU, MS. EVANS?

A. YES. 

Q. AND AS A RESULT, INTEL IS NOW SUPPLYING 100 PERCENT OF THE 

IPHONES WITH -- 

A. I CAN'T TALK ABOUT WHAT'S HAPPENING NOW. 

MR. CARSON: OBJECTION, YOUR HONOR. 

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THE WITNESS: I CAN ONLY TALK ABOUT MARCH OF '18 IS 

WHAT THEY TOLD ME. 

MR. RYAN: WELL, THIS IS A FACT THAT I BELIEVE HAS 

BEEN FREQUENTLY REFERRED TO IN THIS CASE. 

MR. CARSON: YOUR HONOR, I BELIEVE WE TALKED ABOUT 

ANTICIPATION OF APPLE'S SUPPLY RELATIONSHIP WITH INTEL, BUT NOT 

THE ACTUAL FACT ABOUT WHETHER INTEL WAS SUPPLYING 100 PERCENT 

CHIPS NOW. 

THE COURT: OVERRULED. 

GO AHEAD. YOU CAN ASK THE QUESTION. 

BY MR. RYAN:

Q. ALL RIGHT. ISN'T THE CASE THAT INTEL IS NOW SUPPLYING 

MODEM CHIPSETS FOR 100 PERCENT OF THE IPHONES RELEASED IN 2018? 

A. "OVERRULED" MEANING I ANSWER? 

THE COURT: YOU KNOW WHAT? ACTUALLY, I THINK THE 

ONLY PERSON WHO RAISED IT WAS QUALCOMM IN ITS OPENING 

PRESENTATION. I THINK THAT MR. VAN NEST DID IT IN HIS OPENING 

SLIDES. THAT'S WHERE IT CAME IN; CORRECT? 

MR. CARSON: I BELIEVE SO, YOUR HONOR. I HAVEN'T 

READ THE ENTIRE -- 

THE COURT: SO IF QUALCOMM IS DOING IT IN 

CONTRAVENTION OF MY ORDER AND THEN RELYING ON ITS OWN ACTIVITY 

IN CONTRAVENTION OF MY ORDER AS JUSTIFICATION, THEN I'M GOING 

TO SUSTAIN THE OBJECTION. 

MR. VAN NEST: YOUR HONOR, JUST -- 

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THE COURT: MOVE ON TO SOMETHING ELSE. 

MR. VAN NEST: EXCUSE ME. MR. RYAN HAS NOT BEEN HERE 

THROUGHOUT. BUT I UNDERSTOOD FROM THE GROUND RULES THAT THE 

APPLE SITUATION WAS DIFFERENT. MS. MILICI SAID REPEATEDLY 

BEFORE TRIAL THAT THAT FACT, WHICH HAS BEEN PUBLICLY ANNOUNCED 

AND EVERYBODY IN THE WORLD KNOWS, WOULD BE FAIR GAME. SO 

THAT'S WHY I STOOD UP IN THE OPENING AND SAID WHAT EVERYONE 

KNOWS, AND I DIDN'T HEAR AN OBJECTION, AND I DON'T THINK IT'S 

OBJECTIONABLE AT ALL. 

THE COURT: NO, THAT'S NOT WHAT I RECALL. LET'S MET 

MS. MILICI SPEAK FOR HERS. 

AND THIS IS ALL COUNTS TOWARDS YOUR TIME. 

MS. MILICI: YOUR HONOR, WHAT I RECALL FROM OUR 

DISCUSSIONS PRIOR TO TRIAL IS THAT WE SAID THAT THE DISCOVERY 

RECORD CONTAINS THE FACT THAT APPLE HAD CHOSEN INTEL CHIPS FOR 

ITS NEXT RELEASE. THAT IS WHAT I REMEMBER SAYING WAS ON THE 

PUBLIC RECORD AND WAS IN THE DISCOVERY RECORD, IN FACT. 

MR. VAN NEST: I'M SATISFIED WITH THAT. THEY'VE 

CHOSEN IT AND THAT'S -- WE DON'T NEED TO PROVE ANY MORE THAN 

THAT. I THINK WE HAVE PROVEN MORE, BUT... 

MR. RYAN: I'LL ASK THE QUESTION THAT WAY, YOUR 

HONOR. 

THE COURT: OKAY. GO AHEAD. I'M GOING TO STRIKE THE 

QUESTION. AND PLEASE REPHRASE IT. 

BY MR. RYAN:

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Q. ALL RIGHT. AS OF MARCH OF 2018, MS. EVANS, YOU EXPECTED 

THAT INTEL WOULD SUPPLY MODEM CHIPSETS FOR 100 PERCENT OF THE 

IPHONES RELEASED IN THE FALL OF 2018; RIGHT? 

A. NOW YOU'RE USING WORDS THAT ARE CONFUSING LIKE "EXPECTED." 

WHAT I KNEW IN MARCH 2018 IS THAT WE WERE STARTING TO PICK 

UP INDICATION IN THE INDUSTRY THAT THERE WAS A STRONG 

POSSIBILITY WE WERE GOING TO BE -- FIRST OF ALL, WE WERE SOLID 

ON CDMA AND HAD THE CAPABILITY, MEANING WE HAD THE OFFERING, 

AND IT WAS A REAL POSSIBILITY WE WERE GOING TO BE, YOU KNOW, 

100 PERCENT. 

FRANKLY, THIS IS NOW THE OPPOSITE SIDE OF THE GM BONE IN 

ME. I -- I WAS, LIKE, HOPING AND, YOU KNOW -- BUT DID I KNOW 

FOR SURE? NO. 

Q. YOUR UNDERSTANDING, THOUGH, WAS THAT AS OF MARCH OF 2018, 

WAS THAT APPLE HAD CHOSEN INTEL FOR ALL OF ITS IPHONES FOR 

RELEASE THAT YEAR; RIGHT? 

A. NOT MY UNDERSTANDING. WHAT I PICKED UP AND HEARD AND 

CORRELATED, TRIANGULATED, I MEAN, YOU KNOW, SAYING ANOTHER 

COMPANY CHOSE US, YOU HAVE TO GO ASK THEM. 

BUT THERE WERE STRONG INDICATIONS AND NOISE IN THE -- NOT 

NOISE -- RIPPLES IN THE INDUSTRY THAT IT WAS A VERY STRONG 

POSSIBILITY THAT WE WERE GOING TO BE SUPPLYING 100 PERCENT. 

Q. ALL RIGHT. NOW, INTEL HAS BEEN VERY ACTIVE IN PUSHING THE 

DEVELOPMENT OF 5G, HASN'T IT? 

A. YEAH. 

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Q. AND AS OF MARCH OF 2018, INTEL WAS ALREADY IN THE PRODUCT 

DEVELOPMENT PHASE OF 5G, WASN'T IT?

A. YES.

Q. AND INTEL ANNOUNCED ITS FIRST 5G MODEM IN 2017, DIDN'T IT? 

A. I'LL TAKE YOUR WORD FOR IT. I DON'T KNOW WHEN WE 

ANNOUNCED IT. BUT YEAH. 

Q. OKAY. DO YOU RECALL THAT YOU CALLED INTEL'S FIRST 5G 

MODEM A MILESTONE FOR THE INDUSTRY? 

A. I SAY A LOT OF THINGS. PROBABLY, YEAH. 

Q. OKAY. DO YOU -- DO YOU, IN FACT, BELIEVE THAT INTEL'S 

FIRST 5G MODEM, DID YOU, AS OF MARCH 2018, BELIEVE THAT INTEL'S 

FIRST 5G MODEM IS A MILESTONE FOR THE INDUSTRY?

A. YES.

Q. OKAY. AND AS OF THAT TIME INTEL PLANNED THE RELEASE OF 

ITS FIRST 5G MODEM IN LATE 2019; RIGHT? 

A. YES. 

Q. AND AS OF THAT TIME INTEL HOPED TO SELL 5G MODEMS TO APPLE 

FOR USE IN 2020 IPHONES, DIDN'T IT? 

A. YES. ASSUMING WE MAKE IT, YES, UM-HUM.

Q. OKAY. NOW, LET ME TURN TO WHAT YOU WERE TALKING ABOUT THE 

FALL OF 2012. 

A. UM-HUM.

Q. ALL RIGHT. SO IN THE FALL OF 2012, YOU UNDERSTOOD THAT 

INTEL HAD AN OPPORTUNITY TO SUPPLY AN IPAD THAT WAS SCHEDULED 

TO BE RELEASED IN THE EARLY PART OF 2014; RIGHT? 

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A. AS A PIPE CLEANER, YES. 

Q. AND THAT WAS GOING TO BE THE XMM 7160 MODEM CHIPSET, INTEL 

MODEM CHIPSET; RIGHT? 

A. NO. THE XMM 7160 WAS -- HOW DO YOU SAY? -- THE PROOF 

POINT, THE REVERSE PIPE CLEANER, MEANING OUR PIPE CLEANER. 

WE WERE HOPING FOR THE 7260 TO SHIP. BUT WE WERE GOING 

BACK AND FORTH WITH APPLE. 

Q. AND YOU KNEW IN THE FALL OF 2012 THAT NO APPLE DECISION 

HAD BEEN MADE YET, DIDN'T YOU? 

A. THAT'S NOT REALLY THE WAY THEY WORK, SO I DON'T KNOW WHAT 

YOU'RE ASKING ME. 

I CAN TELL YOU WHAT I KNEW. WHAT I KNEW WAS -- 

Q. I'M ASKING YOU -- WHAT I'M INTERESTED IN IS THIS VERY 

SPECIFIC QUESTION: YOU KNEW IN THE FALL OF 2012 THAT APPLE HAD 

NOT MADE A DECISION TO USE AN INTEL MODEM IN AN IPAD? 

A. YEAH, BUT IT'S LIKE ASKING ME IF I'M GOING TO BE 6'4" 

TOMORROW. I ALREADY KNOW THE ANSWER TO THAT. WE DON'T WORK 

LIKE THAT IN A WAY WHERE THEY TELL US A DECISION HAS BEEN MADE 

OR NOT MADE. 

WHAT WE KNOW IS WE GET IN THE LAB, WE ENGAGE, THEY ARE 

ACTIVE, AND THAT'S HOW WE INFER WE ARE IN. NOT BECAUSE YOU GET 

AN E-MAIL THAT SAYS YOU'RE IN. USUALLY WHEN YOU GET AN E-MAIL 

OR A PHONE CALL, IT'S THE OPPOSITE, YOU'RE OUT.

Q. SO IN LATE JANUARY OR EARLY FEBRUARY OF 2013, DID APPLE 

TELL YOU THAT INTEL WOULD NOT BE IN A 2014 IPAD? 

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A. I RECEIVED THE PHONE CALL, I BELIEVE IT WAS EITHER LATE 

DECEMBER OR EARLY JANUARY. AND THEN THERE WAS A FLURRY OF 

MEETINGS, ACTIVITIES FROM MANY DIFFERENT LEVELS, PEOPLE, SOME 

INVOLVED, SOME LESS INVOLVED IN JANUARY, FEBRUARY, AND MARCH. 

Q. OKAY. AND ISN'T IT THE CASE THAT THE REASON APPLE GAVE 

WAS THAT ITS DECISION WAS PURELY BASED ON THEIR OWN INTERNAL 

PRODUCT REALIGNMENT STRATEGY WHICH LEFT INTEL WITHOUT A PRODUCT 

TO INTERSECT? 

A. THAT IS NOT CORRECT. THE PEOPLE WHO WERE WORKING ON THE 

DEVELOPMENT, THE PEOPLE WHO WERE BRIEFING THE MANAGEMENT OF 

APPLE ALL WERE CONSISTENT IN WHAT THEY TOLD US, WHICH IS THAT 

IT WASN'T AN EXECUTION ISSUE, IT WASN'T A FEATURE ISSUE. 

IT WAS BECAUSE THEY HAD A NEW BUSINESS AGREEMENT WITH 

QUALCOMM AND WE WOULD GET A CHANCE IN 2015. 

THE ONLY TIME I HEARD SOMETHING SLIGHTLY DIFFERENT IN 

WHERE THEY -- WHEN THERE WERE SOME OFFSHOOT EXECUTIVES THAT GOT 

TOGETHER WHO WERE NOT DIRECTLY INVOLVED IN THE DAY-TO-DAY. 

WHEN WE TALKED TO ALL OF THE PEOPLE, THE ISABELS, THE 

AARONS, THE RUBENS, WE GOT A VERY CONSISTENT ANSWER.

Q. LET ME ASK YOU, MS. EVANS, TO LOOK AT CX 1608. IT'S 

TOWARD THE FRONT OF THE BINDER? 

A. YES. HANG ON. 

Q. ARE YOU WITH ME ON CX 1608? 

A. YEAH, UM-HUM.

Q. IS THIS AN E-MAIL THAT KEVIN CONSTANTINE SENT TO YOU ON 

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FEBRUARY 2ND, 2013? 

A. YES.

Q. AND MR. CONSTANTINE IS INTEL'S APPLE ACCOUNT 

REPRESENTATIVE, AND WAS AT THAT TIME; RIGHT? 

A. FOR MODEMS, YES, UM-HUM.

Q. ALL RIGHT. AND DO YOU SEE IN THE SECOND PARAGRAPH, HE 

WROTE TO YOU, "THE ICE DECISION TO NOT -- 

MR. CARSON: YOUR HONOR, I WOULD ASK IF WE'RE GOING 

TO READ FROM THE DOCUMENT, IT BE ADMITTED INTO EVIDENCE BEFORE 

WE READ FROM THE DOCUMENT. 

MR. RYAN: I'M NOT SEEKING TO INTRODUCE THIS DOCUMENT 

INTO EVIDENCE. THIS IS AN FTC PROPOSED EXHIBIT. I'M TRYING TO 

USE THIS DOCUMENT TO REFRESH THE WITNESS'S RECOLLECTION ON THE 

QUESTION I JUST ASKED, WHETHER SHE RECALLED THE BASIS FOR THE 

APPLE DECISION. 

MR. CARSON: I DON'T BELIEVE THE WITNESS SAID SHE DID 

NOT RECALL. 

MR. RYAN: THE WITNESS SAID SHE DID NOT RECALL THAT 

APPLE'S DECISION WAS BASED PURELY ON ITS OWN INTERNAL PRODUCT 

REALIGNMENT STRATEGY WHICH LEFT INTEL WITHOUT A PRODUCT TO 

INTERSECT, AND I'M TRYING TO REFRESH THE WITNESS'S RECOLLECTION 

ON THAT EXACT FACT. 

THE COURT: OKAY. I'M SORRY. JUST GIVE ME A MOMENT, 

PLEASE. 

(PAUSE IN PROCEEDINGS.) 

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MR. RYAN: MAY I, YOUR HONOR? 

THE COURT: GO AHEAD, PLEASE. 

(PAUSE IN PROCEEDINGS.) 

THE COURT: ALL RIGHT. WELL, I MEAN, REFRESHING 

RECOLLECTION -- IS THIS REFRESHING RECOLLECTION OR IS IT 

IMPEACHMENT? 

REFRESHING RECOLLECTION, YOU GIVE IT TO THEM, ASK THEM TO 

READ IT, SEE IF IT REFRESHES THEIR RECOLLECTION AND THEN THEY 

TESTIFY. THAT'S NOT WHAT YOU'RE DOING. 

IF IT'S JUST REFRESHING RECOLLECTION, THEN I AGREE IT 

DOESN'T HAVE TO BE ADMITTED. YOU CAN GIVE SOMEONE A BANANA, IF 

IT REFRESHES THEIR RECOLLECTION, THEN THEY'LL TESTIFY ACCORDING 

TO WHAT THEY RECALL. 

MR. RYAN: LET ME DO THAT, YOUR HONOR. 

THE COURT: ALL RIGHT. GO AHEAD, PLEASE. 

BY MR. RYAN:

Q. HAVE YOU HAD A CHANCE, MS. EVANS, TO LOOK AT THE FIRST 

SENTENCE OF THE SECOND PARAGRAPH OF CX 1608? 

A. MR. RYAN, YOU AND I HAVE DISCUSSED THAT WE HAVE TO DO 

CONTEXT. IF I'M GOING TO READ THE FIRST SENTENCE, I'M GOING TO 

READ THE WHOLE THING. 

FIRST OF ALL, IT'S AN ACCOUNT MANAGER, THIS IS AN OFFICIAL 

INTEL E-MAIL. WE DON'T DO ALL THE LITTLE E-MAILS. WE KNOW HOW 

TO WRITE AN E-MAIL. 

THE ICE, ICE STANDS FOR APPLE, THE ICE DECISION TO NOT GO 

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FORWARD WITH US, BECAUSE I TOLD YOU, WHEN YOU ACTUALLY GET A 

DECISION WITH THEM, IT'S BAD BECAUSE THAT MEANS YOU'RE OUT. 

THE ICE DECISION IS NOT -- IS TO NOT GO FORWARD WITH US IN A 

2014 PROJECT IS PURELY BASED ON THEIR OWN INTERNAL PRODUCT 

REALIGNMENT STRATEGY, I.E., THE AGREEMENT WITH QUALCOMM, WHICH 

UNFORTUNATELY LEFT US WITHOUT A PRODUCT TO INTERSECT. 

LET ME BE CLEAR THAT ICE, I.E., APPLE, ACKNOWLEDGES THAT 

OUR EXECUTION WAS EXEMPLARY. FURTHERMORE, THEY ARE IMPRESSED 

WITH THE WAY OUR ROADMAP DEVELOPED OVER THE COURSE OF OUR 

ENGAGEMENT AND EXPECT US TO CONTINUE WITH OUR EXECUTION. THOSE 

OF YOU IN THE CUSTOMER FACING TEAM SHOULD EXPECT THAT ICE WILL 

HAVE ANOTHER MEETING WITH US TO TIE OFF AND THANK US FOR OUR 

EFFORT. THIS HAS LEFT THEM DISAPPOINTED AS THEY WERE LOOKING 

FORWARD TO WORKING WITH US AGAIN. 

Q. MS. EVANS, DOES CX 1608 REFRESH YOUR RECOLLECTION THAT THE 

REASON APPLE GAVE FOR ITS DECISION WAS PURELY BASED ON THEIR 

OWN INTERNAL PRODUCT REALIGNMENT STRATEGY, WHICH UNFORTUNATELY 

LEFT INTEL WITHOUT A PRODUCT TO INTERSECT? 

A. COUNSELOR, CX 89 REFRESHES MY RECOLLECTION THAT MY ACCOUNT 

MANAGER SENT US AN E-MAIL THAT SUMMARIZED THAT, ALONG WITH THE 

STATEMENT YOU MADE IS THE FIRST SENTENCE, CONSISTENT WITH WHAT 

I'VE TOLD YOU.

Q. ALL RIGHT. AND DID YOU LEARN AT THAT TIME, AROUND JANUARY 

OF 2013, THAT THERE WAS A CHANGE IN APPLE PRODUCT RELEASE 

PLANS? 

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A. YES. 

Q. ALL RIGHT. DO YOU RECALL -- WELL, LET ME ASK YOU THIS: 

DO YOU KNOW, ONE WAY OR THE OTHER, WHETHER APPLE, IN FACT, 

CHANGED ITS PRODUCT RELEASE SCHEDULE AT THIS TIME? 

A. I DON'T KNOW. I MEAN, I -- IT WAS -- I DON'T RECALL. IT 

WAS GOING BACK AND FORTH. 

Q. YOU DON'T KNOW? 

A. ALL I KNEW WAS THAT, ONCE AGAIN, I HAD LOST TO QUALCOMM. 

Q. ALL RIGHT. NOW, LET ME ASK YOU ABOUT SOMETHING CALLED 

VOICE-OVER LTE. IS THAT ALSO KNOWN AS VOLTE?

A. YES. HERE OR -- 

Q. NO. I'VE MOVED OFF THAT EXHIBIT. 

A. OKAY.

Q. IS VOICE OVER LTE, OR VOLTE, A TECHNOLOGY THAT ALLOWS LTE 

TO CARRY VOICE COMMUNICATIONS? 

A. YES. IT'S A WONDERFUL TECHNOLOGY THAT IS SUPPOSED TO DO 

THAT AND WE'VE BEEN WAITING AND PLANNING FOREVER TO HAVE IT 

TAKE OVER THE WORLD, YES.

Q. AND VOLTE WAS A MANDATORY REQUIREMENT FROM APPLE FOR THE 

2014 IPHONE, WASN'T IT? 

A. I DON'T KNOW. I MEAN -- I DON'T RECALL THAT. IT'S -- 

IT'S A FEATURE THAT WENT IN AND OUT BECAUSE IN THE INDUSTRY IT 

WAS -- SO THAT'S WHY I CAN'T TELL YOU. SOMETIMES IT WAS 

REQUIRED, SOMETIMES IT WASN'T. 

Q. ALL RIGHT. WELL, LET ME ASK YOU TO LOOK, PLEASE, AT YOUR 

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DEPOSITION TRANSCRIPT. 

A. UM-HUM.

Q. THIS IS TOWARD THE BACK OF THE BINDER IN THE TAB THAT SAYS 

3-14-18 DEPOSITION TRANSCRIPT. 

A. OH. 

Q. MARCH 14TH OF 2018. AND THIS IS ON PAGE -- 

A. YEAH, MARCH 14, YEAH, UM-HUM.

Q. THIS IS ON PAGE 215. IT'S NEAR THE END OF THAT DAY'S 

TRANSCRIPT. 

A. 215, YES. 

Q. YES. 

A. YES, I'M THERE, UM-HUM.

Q. AND DO YOU SEE THAT BEGINNING AT LINE 13 ON PAGE 215, I 

ASKED YOU, "AND WAS VOICE-OVER LTE A MANDATORY REQUIREMENT FROM 

APPLE FOR THE 2014 AND 2015 IPHONES"?

AND YOU ANSWERED, "YES, IT WAS." AND YOUR ANSWER THEN 

CONTINUES AS SHOWN HERE ON LINE 16 TO 22. 

A. OKAY. 

Q. DOES THIS REFRESH YOUR RECOLLECTION THAT VOICE-OVER LTE 

WAS A MANDATORY REQUIREMENT FROM APPLE FOR THE 2014 IPHONE? 

A. YES. SO, AGAIN, IF YOU'RE GOING TO DO, CAN YOU NOT JUST 

SAY ONE SENTENCE BECAUSE I QUALIFIED IT, THE SAME WAY I 

ATTEMPTED TO QUALIFY. 

"YES, IT WAS, BUT NOT -- SO NOT DO YOU HAVE -- NOT ONLY DO 

YOU HAVE TO WORRY ABOUT -- IN OUR INDUSTRY, ABOUT THE FEATURE, 

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BUT YOU ALSO HAVE TO WORRY ABOUT THE KPI, KEY PERFORMANCE 

INDICATION, INDICATOR OF THE FEATURE. SO, YES, IT WAS 

MANDATORY, BUT IT WAS VERY MUCH A CONFIGURATION AND CAPABILITY 

AS OPPOSED TO A LARGE SCALE FEATURE." 

Q. ALL RIGHT. THANK YOU. 

NOW, YOU UNDERSTOOD, DIDN'T YOU, FROM APPLE THAT CARRIER 

AGGREGATION WOULD BE VERY IMPORTANT FOR THE 2014 TIMEFRAME? 

A. YES. 

Q. AND INTEL'S XMM 7160 MODEM CHIP DID NOT HAVE CARRIER 

AGGREGATION, DID IT? 

A. NO. BUT AS I TESTIFIED EARLIER, WE ALWAYS LOOKED AT 7160 

AS OUR PIPE CLEANER SIDE, AND 7260 AS THE ONE WE WANTED TO LAND 

ON, AND THAT ONE HAD CARRIER AGGREGATION. 

Q. QUALCOMM AT THIS TIME WAS AHEAD OF INTEL IN THE 

DEVELOPMENT OF CARRIER AGGREGATION, WASN'T IT? 

A. YES. 

Q. NOW, IN 2014, A WIRELESS STANDARD CALLED TD-SCDMA WAS 

ESSENTIAL TO SHIP IN CHINA, WASN'T IT? 

A. A CHINESE WIRELESS STANDARD, YES, UM-HUM.

Q. OKAY. AND THAT WAS ESSENTIAL IN 2014 TO SHIP HANDSETS IN 

CHINA, WASN'T IT? 

A. YES, UM-HUM.

Q. AND INTEL'S XMM 7160 MODEM CHIPSET DID NOT HAVE TD-SCDMA 

CAPABILITY MONOLITHICALLY INTEGRATED SO THAT IT WAS ON THE SAME 

CHIP AS THE LTE MODEM; ISN'T THAT RIGHT? 

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A. THAT IS CORRECT. 

Q. OKAY. 

A. I THINK WE -- YES, SAME ANSWER AS -- I SEE THE PATTERN 

HERE, VOLTE, CARRIER AGGREGATION, THOSE WERE ALL FEATURES THAT 

WERE BEING DISCUSSED. QUALCOMM HAD THEM. NO QUESTION ABOUT 

IT. 

OUR PIPE CLEANER 7160 DID NOT, BUT 7260 DID.

Q. OKAY. BUT INTEL DIDN'T HAVE ANY OF THOSE THREE FEATURES 

FOR THE XMM 7160, RIGHT? 

A. NO, FOR THE 7260, WHICH IT HOPED TO BE THE DEVICE THAT 

SHIPPED, YES.

Q. OKAY. NOW, LET ME ASK YOU SOME QUESTIONS ABOUT INTEL'S 

MARGINS, AND I'M GOING TO BE CAREFUL IN THE QUESTIONS I ASK -- 

A. THANK YOU.

Q. -- OBVIOUSLY GIVEN INTEL'S SEALING MOTION HERE, BUT I 

THINK I'LL HAVE NO TROUBLE ASKING THESE QUESTIONS. 

A. UM-HUM.

Q. ON DIRECT YOU GAVE TESTIMONY ABOUT INTEL'S LOW PRODUCT 

MARGIN ON THE SALE OF MODEM CHIPSETS TO APPLE; RIGHT? 

A. YES, UM-HUM.

Q. AND PRODUCT MARGIN FOR AN INTEL BASEBAND CHIPSET IS THE 

AVERAGE SELLING PRICE MINUS THE PRODUCT COST OR MANUFACTURING 

COST; RIGHT? 

A. ACTUALLY, I WANT TO CORRECT THE RECORD. I GAVE TESTIMONY 

ON GROSS MARGIN. 

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Q. OKAY. 

A. NOT ON PRODUCT MARGIN. 

Q. OKAY. 

A. BUT IF YOU WANT TO TALK ABOUT PRODUCT MARGIN, THAT'S OKAY, 

TOO.

Q. OKAY. GROSS MARGIN FOR AN INTEL BASEBAND CHIPSET IS THE 

AVERAGE SELLING PRICE MINUS THE MANUFACTURING OR PRODUCTION 

COST; RIGHT? 

A. YES. 

Q. ALL RIGHT. 

A. THE MANUFACTURING PART THREW ME BECAUSE WE'RE A 

MANUFACTURING COMPANY. SO WHY DON'T I DEFINE. GROSS MARGIN IS 

ASP, AVERAGE SELLING PRICE, MINUS THE, THE PRODUCT COST ITSELF. 

WHEREAS PRODUCT MARGIN, OP MARGIN IS THE AVERAGE SELLING 

PRICE, MINUS THE ACTUAL PHYSICAL PRODUCT COST, MINUS ALSO THE 

DEVELOPMENT COST. 

MR. RYAN: OKAY. THANK YOU. 

THE COURT: I'M SORRY TO INTERRUPT. IT'S 4:36. 

LET'S GO AHEAD AND END FOR THE DAY. YOU WILL HAVE TO COME BACK 

ON FRIDAY AT 9:00 A.M. TO CONTINUE THIS EXAMINATION. 

THE WITNESS: YES, YOUR HONOR. 

THE COURT: SO YOU'RE DONE FOR THE DAY. 

THE WITNESS: THANK YOU. 

THE COURT: YOU MAY STEP DOWN. 

THE WITNESS: THANK YOU. 

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UNITED STATES COURT REPORTERS

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THE COURT: OKAY. ARE THERE ANY ISSUES FOR TODAY? 

OH, YOU'RE FREE TO STEP DOWN. 

THIS IS JUST HOUSEKEEPING WITH THE PARTIES. 

THE WITNESS: THANK YOU. 

THE COURT: WE'LL RESUME ON FRIDAY AT 9:00. NO TRIAL 

TOMORROW. 

I'M HAVING A FULL CRIMINAL CALENDAR IN HERE TOMORROW, SO I 

RECOMMEND THAT YOU TAKE EVERYTHING OUT OF THE COURT -- 

OH, YOU'RE FREE TO LEAVE. YOU'RE FREE TO LEAVE. 

THE WITNESS: THANK YOU. 

THE COURT: -- THAT YOU TAKE EVERYTHING OUT. 

AND -- SO A JOINT EXHIBIT LIST AND THE NEXT DAY'S LIST OF 

WITNESSES, WHEN WILL YOU FILE THAT? AND DO YOU KNOW OF ANY 

MORE THIRD PARTIES THAT WILL BE FILING SEALING MOTIONS THIS 

WEEK? 

MS. MILICI: I'M NOT AWARE OF ANY OTHER THIRD PARTIES 

THAT WOULD BE FILING SEALING MOTIONS THIS WEEK, NO. 

THE COURT: OKAY. AND FOR ANY OF THE PARTIES WHOM 

THEIR MOTION FOR SEALING WAS DENIED WITHOUT PREJUDICE AND THEY 

WERE ASKED TO REFILE, IF THEY DON'T FILE, THEN I'M ORDERING 

THEM TO FILE IT UNREDACTED. AND IF THEY DON'T DO IT, THEN I'M 

GOING TO HOLD THEM IN CONTEMPT. 

SO THERE ARE SEVERAL PARTIES THAT I'VE ASKED TO REFILE 

THEIR SEALING MOTIONS AND THEY HAVEN'T. SO I'VE JUST FILED 

ORDERS ORDERING THEM TO FILE IT UNREDACTED AND IF THEY DON'T, I 

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UNITED STATES COURT REPORTERS

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WILL HOLD THEM IN CONTEMPT. SO YOU MAY WANT TO CONVEY THAT TO 

SOME OF THE PARTIES WHO HAVEN'T -- 

MS. MILICI: UNDERSTOOD, YOUR HONOR. 

THE COURT: -- RENEWED THEIR MOTIONS TO SEAL. 

OKAY. WHAT ELSE? 

SO YOU'RE GOING TO PUT ON YOUR JOINT EXHIBIT LIST THE 

PAGES TO BE SEALED. I THINK THAT WOULD BE HELPFUL -- 

MS. MILICI: YES, YOUR HONOR. 

THE COURT: -- GOING FORWARD. 

MR. RYAN: YES, YOUR HONOR. 

THE COURT: AND I DENIED, WITH ONE EXCEPTION, 

QUALCOMM'S MOTION TO SEAL ITS EXHIBIT LIST. SO I'M ASSUMING 

NOW YOU CAN -- I MEAN, THE PARTIES HAVE UNSEALED A TON. JUST 

GOING THROUGH A LOT OF THE THINGS YOU'VE TRIED TO SEAL, WE'VE 

HAD OPEN COURT TESTIMONY ABOUT IT. 

SO I THINK YOU CAN START CREATING A JOINT EXHIBIT LIST 

THAT ACTUALLY DESCRIBES THE EXHIBITS NOW BECAUSE I DON'T THINK 

THERE SHOULD BE ANY UNNECESSARY SEALING MOTIONS BECAUSE MOST 

THINGS HAVE BEEN UNSEALED. 

WHAT ELSE? ANYTHING ELSE? 

WHEN ARE YOU GOING TO FILE THAT, AS WELL AS THE LIST OF 

WITNESSES FOR FRIDAY? 

MS. MILICI: THE -- THE LIST OF WITNESSES FOR FRIDAY, 

I THINK WE'RE SCHEDULED TO DO THAT ON WEDNESDAY. SO TOMORROW. 

THE COURT: OKAY. OKAY.

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MS. MILICI: AND THE EXHIBIT LIST, I'M NOT SURE HOW 

LONG THAT WOULD TAKE. BUT IT SHOULDN'T TAKE VERY LONG. 

THE COURT: IT DOESN'T MATTER TO ME WHETHER IT'S 

WEDNESDAY OR THURSDAY. WHAT WOULD YOU PREFER? 

MS. MILICI: LET'S SAY THURSDAY. 

THE COURT: THAT'S FINE. BUT LET'S DO IT AT -- THE 

THING THAT IS HELPFUL IS KNOWING WHICH WITNESSES ARE TESTIFYING 

IS THAT WE PRIORITIZE THOSE SEALING MOTIONS FIRST, SO THAT 

WOULD BE HELPFUL TO KNOW. AND THE THIRD PARTIES ARE ALL JUST 

FILING THE DAY BEFORE, SO IT'S PUTTING A LOT OF PRESSURE ON US 

TO GET THIS DONE WITHIN 12 HOURS, WHICH IS NOT ALWAYS EASY 

DEPENDING ON THE VOLUME OF THE DOCUMENTS THEY'RE ASKING US TO 

REVIEW. 

MS. MILICI: UNDERSTOOD, YOUR HONOR. I DO THINK THAT 

THE SEALING MOTIONS HAVE -- I BELIEVE THAT THEY'VE ALL BEEN 

FILED. 

THE COURT: OKAY. SO THERE'S NO OTHER THIRD PARTIES 

YOU THINK THAT -- 

MR. CARSON: I MEAN, NONE THAT WE'RE AWARE OF, YOUR 

HONOR. 

THE COURT: OKAY. 

MR. CARSON: IT'S POSSIBLE AS NOTIFICATIONS ARE 

COMING THROUGH, YOU KNOW, WE'RE GIVING THIRD PARTIES 

NOTIFICATIONS AS WE HAVE THEM AND RECEIVE THEM AS SOON AS 

POSSIBLE. BUT IT'S POSSIBLE MORE WILL COME IN. WE HOPE NOT. 

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THE COURT: WELL, YOU'RE GIVING THEM 48 HOURS NOTICE; 

RIGHT? 

MR. CARSON: MORE THAN THAT IN MOST CASES, YOUR 

HONOR. 

MS. MILICI: MORE THAN THAT. 

THE COURT: OKAY. WELL, WHAT TIME ARE YOU GOING TO 

FILE THE JOINT -- I LIKE DEADLINES. SO WHAT TIME ARE YOU GOING 

TO FILE THE EXHIBIT LIST AND WHAT TIME ARE YOU GOING TO FILE 

THE WITNESS LIST? GIVE ME A TIME FOR EACH DAY, PLEASE. 

MS. MILICI: FOR THE WITNESS LIST, WE CAN FILE AT 

NOON ON WEDNESDAY. 

THE COURT: WHEN ARE YOU DOING YOUR EXCHANGE? WHAT 

TIME ARE YOU DOING YOUR EXCHANGE WITH QUALCOMM. I THINK THAT'S 

WHAT WE HAD AGREED WAS THE TIME. 

MS. MILICI: I THINK WE'RE DOING IT AT, WHAT, 6:00 

O'CLOCK TONIGHT? 

THE COURT: 6:00 IS FINE. 

MS. MILICI: WE CAN FILE IT WITH YOUR HONOR TONIGHT. 

THE COURT: ARE YOU DOING THE EXCHANGE TODAY? 

MS. MILICI: YES. SO WE CAN FILE IT TODAY IF YOU 

WOULD LIKE. 

THE COURT: OH, YOU'RE DOING THE EXCHANGE FOR FRIDAY 

TODAY? 

MS. MILICI: YES. 

THE COURT: OKAY. SO THEN WHEN WILL YOU FILE THE 

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HIGH PRIORITY OBJECTIONS FOR FRIDAY. 

MS. MILICI: SO WE'VE BEEN DOING IS EXCHANGING A LIST 

AT 6:00 P.M. SO WE CAN IDENTIFY THE EVIDENCE THAT WE EXCHANGE 

THE NEXT MORNING FOR THE HIGH PRIORITY OBJECTIONS. 

THE COURT: OKAY. 

MS. MILICI: BECAUSE THEY DON'T KNOW WHO TO IDENTIFY 

EVIDENCE FOR UNLESS WE'VE TOLD THEM WHO THE WITNESSES ARE. SO 

WE GIVE THEM THE WITNESSES AT 6:00 P.M., WHICH WOULD BE 

6:00 P.M. TODAY, AND THEN WE EXCHANGE EXHIBITS THE NEXT 

MORNING. 

THE COURT: OKAY. SO YOU'RE GOING TO FILE THEM 

THURSDAY MORNING, THEN? 

MS. MILICI: YES. 

THE COURT: OKAY. I DIDN'T HAVE ANYTHING ELSE. DID 

YOU ALL HAVE ANYTHING ELSE? 

MR. VAN NEST: I HAD ONE THING. 

THE COURT: DO YOU WANT YOUR TIME? 

MR. VAN NEST: I HAD ONE ITEM ALSO. 

THE COURT: OKAY. WHAT'S THAT? 

MR. VAN NEST: AND I WASN'T QUICK ENOUGH TO MENTION 

IT. BUT COULD WE, THROUGH COUNSEL, ADMONISH THE WITNESS THAT 

SHE SHOULDN'T BE SPEAKING WITH HER LAWYERS OR THE FTC ABOUT THE 

CASE? 

THE COURT: WE HAVEN'T ADMONISHED ANY OTHER 

WITNESSES. 

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MR. VAN NEST: BUT SHE'S HANGING OVER TWO DAYS. 

THE COURT: HAVE ANY OF THE WITNESSES TALKED TO THEIR 

LAWYERS DURING LUNCH BREAK? DID MR. AMON TALK TO MS. SESSIONS? 

MR. VAN NEST: OF COURSE NOT. THE ONLY REASON I 

RAISE IT, YOUR HONOR, IS THAT AS YOU KNOW, INTEL IS IN VARIOUS 

COMMON INTERESTS AGREEMENTS AND THIS IS GOING TO BE A TWO DAY 

LAPSE. I'M NOT -- IT'S NOT AS THOUGH IT'S JUST OVERNIGHT, BUT 

WE'VE GOT A COUPLE OF DAYS HERE, AND I THINK COUNSEL SHOULD BE 

ADMONISHED TO JUST LET HER KNOW THAT. 

THE COURT: ALL RIGHT. WHAT'S YOUR POSITION? I 

HAVEN'T DONE THAT WITH ANYONE ELSE. WHAT'S YOUR VIEW ON THAT? 

I MEAN, I PROBABLY SHOULD HAVE DONE THAT AT THE VERY BEGINNING 

WITH EVERY SINGLE WITNESS? 

MS. MILICI: OF ADMONISHING THE WITNESS? WE DON'T 

HAVE A PROBLEM WITH THE WITNESS BEING TOLD THAT. I THINK WE 

ALL UNDERSTAND THAT'S THE RULES. 

MR. VAN NEST: THANK YOU. 

THE COURT: ALL RIGHT. GO AHEAD AND DO THAT. AND 

CAN EVERYONE AFFIRM FOR ME UNDER OATH THAT THEY HAVEN'T TALKED 

TO ANY OF THEIR WITNESSES DURING A LUNCH BREAK, DURING A 20 

MINUTE BREAK, DURING A 10 MINUTE BREAK? 

MS. MILICI: WE ABSOLUTELY CAN. 

MR. VAN NEST: WE CAN AS WELL. 

THE COURT: ALL RIGHT. SO LET ME GIVE YOU YOUR 

TIMES. 

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MS. MILICI: AND, YOUR HONOR, JUST TO CLARIFY, I 

UNDERSTAND FROM MY TEAM THAT THERE WILL BE A SEALING MOTION 

FROM ERICSSON, BUT WE WEREN'T PLANNING TO PLAY THAT VIDEO ON 

FRIDAY. THERE'S A VIDEO THAT WE WILL PLAY NEXT WEEK THAT WE 

WOULD EXPECT A SEALING MOTION FOR, BUT IT'S NOTHING THAT HAS TO 

BE DECIDED BEFORE FRIDAY. 

THE COURT: WELL, IT'S NOT BETTER FOR US TO DO IT ON 

SUNDAY. SO, I MEAN, IF THEY DO IT THIS WEEK, IT'S BETTER FOR 

US TO DO IT TOMORROW AND THURSDAY IF IT'S POSSIBLE. SO -- 

MS. MILICI: UNDERSTOOD. 

THE COURT: YEAH. DOING THEM ALL ON SUNDAY NIGHT AS 

WE DID LAST WEEK IS NOT BETTER FOR US. 

MS. MILICI: UNDERSTOOD. 

THE COURT: SO PLEASE DON'T -- 

MS. MILICI: OKAY. 

THE COURT: OKAY. SO HERE ARE THE TIMES. 

FTC USED 3 HOURS AND 6 MINUTES; AND QUALCOMM USED 2 HOURS 

AND 38 MINUTES. 

OKAY. ALL RIGHT. ANYTHING ELSE FOR TODAY? 

MS. MILICI: NOT FROM THE FTC. 

MR. VAN NEST: NOTHING FROM QUALCOMM, YOUR HONOR. 

THE COURT: ALL RIGHT. THANK YOU ALL VERY MUCH. 

WE'LL SEE YOU ON FRIDAY. THANK YOU. 

(THE EVENING RECESS WAS TAKEN AT 4:44 P.M.)

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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 8, 2019

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