EXHIBIT 51
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 1 of 132
KEVIN IMES
March 10, 2005 Page 1
1 2
IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA HYPERCOM CORPORATION § § § § § NO. CIV 04-0400 PHX PGR § § § § §
3 Plaintiff, 4 Vs. 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 VERVE L.L.C. and OMRON CORPORATION, Defendant(s).
******************************************************* ORAL AND VIDEOTAPED DEPOSITION OF KEVIN IMES March 10, 2005 Volume 1 of 1 *******************************************************
ORAL AND VIDEOTAPED DEPOSITION of KEVIN IMES, produced as a witness at the instance of the Plaintiff, and duly sworn, was taken in the above-styled and numbered cause on the 10th of March, 2005, from 9:05 a.m. to 1:57 p.m., before Pamela Nichols, CSR in and for the State of Texas, reported by computer-aided machine shorthand, at the offices of Fulbright & Jaworski, 600 Congress Avenue, 23rd Floor, Austin, Texas, pursuant to the Federal Rules of Civil Procedure and the provisions stated on the record or attached hereto.
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 2 of 132
KEVIN IMES
March 10, 2005 Page 2
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 ALSO PRESENT: Corey Bailey, Videographer FOR THE DEFENDANT VERVE L.L.C.: Mr. Gregory S. Donahue SIMON, GALASSO & FRANTZ, PLC 6300 Bridgepoint Parkway, Building One Suite 410A Austin, Texas 78730 (512) 231-1311 FOR THE PLAINTIFF: Mr. Sid Leach SNELL & WILMER, L.L.P. One Arizona Center Phoenix, Arizona 85004-2202 (602) 382-6000 A P P E A R A N C E S
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 3 of 132
KEVIN IMES
March 10, 2005 Page 3
1 2 3 4 5 6 7 8 9
INDEX Appearances......................................... 2 Stipulations (attached)............................N/A KEVIN IMES Examination by Mr. Leach........................ 6 Signature and Changes............................. 129 Reporter's Certificate............................ 131
EXHIBITS 10 NO. DESCRIPTION 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 7.................................................. 62 Patent Assignment Between Omron and Verve 8.................................................. 64 Patent Assignment and License Agreement Between Omron and Verve 3.................................................. 47 Patent Assignment Between Omron and Verve 4.................................................. 49 United States Patent No. 4,678,895 Dated 7-7-87 5.................................................. 53 Patent Assignment Agreement Between Omron and Verve 6.................................................. 55 Request For Authorization, Omron Document No. 538 2.................................................. 24 Letter from Herbert Kerner to Raymond Galasso dated 8-18-03 1.................................................. Amended Notice of Videotaped Deposition of Kevin Imes 5 PAGE
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 4 of 132
KEVIN IMES
March 10, 2005 Page 4
1 2 NO. DESCRIPTION 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
EXHIBITS CONTINUED PAGE
9.................................................. 66 Point-Of-Sale Portfolio Assessment and Market Analysis 10................................................. 71 Patent Assignment Between Omron and Verve 11................................................. 75 United States Patent No. 4,562,341 Dated 12-31-85 12................................................. 76 Addendum 1-033004 to Patent Assignment and License Agreement No. 031804 Between Omron and Verve 13................................................. 90 Various e-mail messages from Ray Galasso to Herbert Kerner and Herbert Kerner to Ray Galasso 14................................................. 89 E-mail message from Herbert Kerner to Raymond Galasso Dated 1-21-05 15................................................. 95 E-mail message from Raymond Galasso to Herbert Kerner Dated 1-28-04
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 5 of 132
KEVIN IMES
March 10, 2005 Page 5
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
(Imes Exhibit No. 1 marked.) THE VIDEOGRAPHER: This is the videotaped
deposition of Kevin Imes, taken in the matter of Hypercom Corporation Vs. Verve L.L.C., et al, Civil Action No. 04-0400 PHX PGR, the United States District Court, District of Arizona, held in the offices of Fulbright & Jaworski, 600 Congress Avenue, in Austin Texas. The videographer's name is Corey Bailey. The
court reporter's name is Pam Nichols. March 10th, 2005.
Today's date is
We're on the record at 9:05 a.m.
Would counsel please introduce themselves. MR. LEACH: I'm Sid Leach. I'm
representing the plaintiff, Hypercom Corporation. MR. DONAHUE: And I'm Greg Donahue and
I'm representing the defendant, Verve L.L.C. THE VIDEOGRAPHER: swear in the witness. (Witness placed under oath by reporter.) MR. LEACH: For the record: I've marked The court reporter may
a copy of the amended notice of deposition as Exhibit 1. MR. DONAHUE: Can I -- I don't want to
interrupt during the deposition here, so let me just get one thing off the plate. I was wondering -- we
don't have a protective order in this case, as you
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 6 of 132
KEVIN IMES
March 10, 2005 Page 6
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
know; and I think what we'd like to do -- and I don't imagine that you're necessarily going to be getting into any confidential information here; but to the extent we later designate something as confidential during the 30-day period, are you willing to allow that without the protective order? I mean, I think we disagree on what is confidential in this case. forth on it. We've kind of gone back and
But I think it makes sense that if --
whatever we ultimately enter into as a protective order, if something in this deposition ultimately fits one of those, the description of confidential, that we're allowed to designate it during the 30-day period for review. MR. LEACH: Sure. In the first instance, If we have some
we will agree to your designation.
disagreement about whether it's confidential, then we will proceed to challenge that. MR. DONAHUE: That's acceptable.
KEVIN IMES, having been first duly sworn, testified as follows: EXAMINATION BY MR. LEACH: Q. A. What is your name, please? It's Kevin Reed Imes.
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 7 of 132
KEVIN IMES
March 10, 2005 Page 7
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Q. A. Q. A. Q.
Are you employed? I'm self-employed. Are you one of the principals in Verve, L.L.C.? Yes, I am. What is your -- the percentage of your
interest in Verve, L.L.C.? A. Q. A. Q. L.L.C.? A. Q. A. Approximately 2002. Can you give me a more precise date? Fall. It could have been August time frame, It's half owner. Fifty percent? Fifty percent. When did you become a principal in Verve,
too, second half of the year. Q. You have a bachelor's degree in electrical
engineering; is that correct? A. Q. Yes, I do. Where did you -- what university or
institution did you receive that from? A. Q. A. Q. University of Texas at Austin. What year? 1998. Do you have any other degrees from
universities or colleges?
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 8 of 132
KEVIN IMES
March 10, 2005 Page 8
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
A. Q.
No, I don't. You're also registered to practice before the
U.S. Patent and Trademark Office; is that correct? A. Q. That is correct. And in order to obtain that registration, you
passed a test administered by the United States Government testing your knowledge of patent procedure and practice? A. Q. Correct. When did you obtain your registration to
practice before the U.S. Patent and Trademark Office? A. Q. I believe it was 1999. At one time you worked for a law firm named
Thompson & Knight; is that correct? A. Q. A. That is correct. What was your position with Thompson & Knight? It was a patent agent and technical advisor,
in reverse order. Q. As a technical advisor were you involved in
the preparation of patent applications? A. Q. Yes. And then I assume you became a patent agent
after you became registered to practice before the U.S. Patent and Trademark Office? A. That would be correct.
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 9 of 132
KEVIN IMES
March 10, 2005 Page 9
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Q.
During what years were you employed by
Thompson & Knight? A. Q. of 2002? A. I worked for the law firm of Baker Botts -1998 to 1999. Where did you work between 1999 and the fall
actually, they had two names at the time, Baker & Botts, and now it's Baker Botts -- from 1999 until 2000, I want to say the latter part of 2000. And then
I was self-employed from 2000 to present, or I guess your question was through 2002, so ... Q. When you worked for Baker & Botts, what was
your position? A. Q. I was a patent agent. And as a patent agent at Baker & Botts, were
you involved in the preparation of patent applications and prosecution of patent applications? A. Q. A. Q. That is correct. What office of Baker & Botts did you work at? The Austin office. Since the year 2000 in which you've been
self-employed, do you work out of your house? A. Q. A. From time to time, yes. Where do you live? 2001 --
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 10 of 132
KEVIN IMES
March 10, 2005 Page 10
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Q. A. Q. A. Q.
Where did you live in year 2000? I'm sorry, I'm giving you an address. Oh, of 2001? Yes -- South MoPac, Austin, Texas, 78746. And 2001 South MoPac is your current residence
address; is that correct? A. Q. A. Q. A. Q. A. Yes, it is. How long have you resided there? Since July of last year. Since July 2004? July 2004. Where did you reside prior to that? I owned a home, 800 -- I'll just give you the And I'll have to spell It's
address -- Honeysuckle Lane.
the city for you, I don't think you'll get it. P-F-L-U-G-E-R-V-I-L-L-E.
The court reporter might have known, but -Q. A. Q. A. Q. A. Q. Of course it's in Texas, right? Yes, it is. And that's in the Austin, Texas area? Yes. And how long did you live there? I bought the home in 2000. Do you have any other business offices other
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 11 of 132
KEVIN IMES
March 10, 2005 Page 11
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
than your home at 2001 South MoPac? A. Q. A. Yes, I do. Where at? 6300 Bridgepoint Parkway, Building One, Suite
410B, Austin, 78730. Q. Is the office at 6300 Bridgepoint Parkway
something that you lease personally or is that for some business? A. Q. A. Q. It's for a business. What business? Verve. When did Verve lease the office at 6300
Bridgepoint Parkway? A. Q. A. Q. A. Q. Last month, March -March of -No, February. February of 2005? Uh-huh. How many square feet do you have at 6300
Bridgepoint Parkway? A. Oh, gosh, I didn't walk it off or anything,
but I'd say my office would be eight, six -- I don't know, four, 500 square feet. It's a good size, but I'm Then, of course,
not too good with square footage.
entryways and stuff like that I'm not really counting,
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 12 of 132
KEVIN IMES
March 10, 2005 Page 12
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
so ... Q. A. Q. A. Q. Did you sign a written lease? No, sure didn't. No written lease? No. Who are you leasing -- who is Verve leasing
the space from? A. Q. A. Q. A. I guess I have a question. Who owns the space? Well, Verve is leasing the space. Okay. But you asked me personally and that's what my
question is. Q. A. guess. Q. A. No, who is Verve leasing the space from? Verve leases the space from REIT Management, I I'm not sure. All right. But who? I
I'm not sure who the property owner is.
think it's REIT, Bridgepoint Parkway. Q. Who did Verve deal with in getting the lease?
Is there a management company or something? A. Q. A. Q. Yeah -Who is it? -- that is. REIT Management.
REIT Management?
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 13 of 132
KEVIN IMES
March 10, 2005 Page 13
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
A. Q. A.
Yeah, R-E-I-T. R-E-I-T? Or R-I-E-T, one of the two. I always get my
"i before e" mixed up. Q. A. Q.
I think it's one of those two.
How long is the lease? Three years. Is there any understanding or intent that
you're going to sign a written lease or -A. Q. No, I believe there is. Oh, I'm sorry. I maybe misunderstood your
question [sic]. A. Yeah, and that's kind of the question that I
have for Greg. Q. A. Q. Verve? A. I don't have knowledge of that. I didn't sign Was there a written lease for that space? Yes, there is. And it's between REIT Management and -- is it
the lease, so I couldn't answer your question. Q. Do you have any information concerning who did
sign the lease? A. Greg will also -MR. DONAHUE: THE WITNESS: questions -Did you need to confer? Well, some of his
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 14 of 132
KEVIN IMES
March 10, 2005 Page 14
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 record. Q. today? A. Q. A. Q. A. Q. A. Q. A. Q. A. Q.
Yeah, could we take a minute? MR. LEACH: THE WITNESS: All right. I just want to understand a
few things, so ... not that it's a big deal, I mean. Are we off the record? THE VIDEOGRAPHER: The time is 9:17 a.m. (Recess from 9:17 to 9:19.) THE VIDEOGRAPHER: The time is 9:19 a.m. (BY MR. LEACH) Does Verve have any employees We're back on the We're off the record.
Not that I'm aware of. Does Verve have a telephone number? Yes. What is the phone number for Verve? It is 324-8712. And that's in area code 512? Yes, it is, uh-huh. And when did Verve get that phone number? It was last month. In February 2005? Correct. Is there any agreement between you and Raymond
Galasso relating to Verve?
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 15 of 132
KEVIN IMES
March 10, 2005 Page 15
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
A. Q. A. Q.
Yes. Is the agreement in writing? No. Can you tell me what the substance of the
agreement is? A. Q. A. Our business relationship. Can you describe that to me, please. I believe we touched on it earlier: percentage
of ownership in the company. Q. A. Q. Okay. No. Is there any understanding between you and Anything else?
Mr. Galasso concerning division of responsibilities or who's going to do what relative to the business of Verve? A. Q. A. Yes. What is that? Ray handles more of the legal aspects and I
handle more of the business aspects. Q. A. Q. When did you first meet Raymond Galasso? In 1998. Was that during the time that you were working
at Thompson & Knight? A. Q. Yes, it was. Was Mr. Galasso also working at Thompson &
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 16 of 132
KEVIN IMES
March 10, 2005 Page 16
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Knight? A. Q. Yes, he was. When did you first have any contact or
communication with Mr. Galasso concerning what eventually ended up as your business relationship at Verve? A. Q. A. It was in 2002. Do you know more precisely when in 2002? It was probably two or three months prior to So I guess you
when I told you I became involved. could say summer of 2002. Q. A. Q.
Who initiated those contacts? I did. And what were the circumstances under which
you initiated contact with Mr. Galasso at that time? A. It was at a point where I could commit, you
know, more of my time to another business venture, so I initiated contact with Ray to see where Verve was. Q. A. Q. And at the time you were self-employed? Yes. What did Mr. Galasso tell you about Verve
prior to the time that you became a principal? A. Q. I don't understand what you're asking. I'd like to know what he told you about Verve Did he
prior to the time that you got involved.
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 17 of 132
KEVIN IMES
March 10, 2005 Page 17
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
describe the business of Verve? Verve did? A.
Did he tell you what
He did say anything about Verve?
Well, I had a -- I had a general understanding
of what Verve did prior to that, so there wasn't any conversation about what Verve -Q. Okay. Where did you obtain your understanding
of what Verve did prior to those communications with Mr. Galasso? A. I knew that Mr. Galasso had a patent holding
company prior to that. Q. A. And how did you know that? Because Verve was in litigation in several
matters prior to 2002. Q. Did you have any involvement in that
litigation? A. Q. No, I sure didn't. So did you approach Mr. Galasso with a
proposal concerning Verve? A. Q. No. Other than as an employee of Thompson &
Knight, had you ever done any work for Mr. Galasso or Verve prior to becoming a principal at Verve? A. Q. No. What were the discussions that you had with
Mr. Galasso prior to the time that you became a
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 18 of 132
KEVIN IMES
March 10, 2005 Page 18
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
principal in Verve concerning the possibility of getting involved? A. Okay. I thought that the -- Verve -- I I had a good
thought Verve was interesting.
understanding of patents and wanted to get involved, you know, in Verve as a company. Q. Prior to that time, to your knowledge, had
Mr. Galasso been the sole owner of Verve? A. Q. As far as I know. When you became a principal in Verve, did you
receive any shares of stock? A. Q. No. Did you sign any written agreement with
Mr. Galasso? A. Q. any? A. Q. A. Q. The one we talked about earlier. That you'd own 50 percent? Correct. Does your 50 percent ownership give you the No. What was the agreement that you did reach, if
right to 50 percent of the earnings of Verve? A. Q. Correct, and expenses, so ... Are you or Mr. Galasso paid any other fees in
addition to your 50 percent split?
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 19 of 132
KEVIN IMES
March 10, 2005 Page 19
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
A. Q.
No. When you became a principal of Verve in
generally August of 2002, was there any particular project underway? Was Mr. Galasso involved at all in
any patents relating to the point-of-sale terminals, or POS terminals? A. Q. A. Q. No, there were not. Was there any discussion of Omron Corporation? No. When was the first occasion that there was any
activity or consideration or discussion concerning Omron Corporation? A. Q. A. Q. A. Q. I don't know what the first activity would be. What's the first that you know of? I believe it was in 2003 sometime. Do you know any more precisely when in 2003? Say June, July, August, that time frame. What are the first discussions that you're
aware of relating to Omron? A. I'm trying to think back to the first. It was
probably more of -- I think it was reviewing a patent or two that Omron owned, were the initial discussions. Q. Do you know who initiated the contacts between
Omron and Verve? A. No, I don't.
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 20 of 132
KEVIN IMES
March 10, 2005 Page 20
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Q. A.
Which patent was being reviewed? Okay. We can go with the last three numbers,
I guess would be convenient for all of us, wouldn't it? Q. A. Q. That's fine. The '895 and I want to say the '200. Were you involved in any of the communications
between Verve and Omron prior to the time that the first agreement was signed between Verve and Omron? A. Q. I don't believe so, no. As far as you know, were those communications
conducted on behalf of Verve by Ray Galasso? A. Q. I believe so. At the time that the first agreement was
entered into between Verve and Omron, what understanding, if any, did you have concerning what the agreement was? A. That it was -- that it was going to be an
assignment and -Q. A. proceeds. Q. A. Anything else? At the time, huh-uh. Outside of that general Anything else? -- and that it would be a revenue share on
business terms, nothing comes to mind. Q. Prior to the time that the first agreement was
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 21 of 132
KEVIN IMES
March 10, 2005 Page 21
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
signed between Verve and Omron, did you prepare any proposals, analysis -A. Q. A. I was involved in proposals. Yes, I was.
Were there any written proposals? Yes. Oh, I'm sorry, the time frame again?
Q. A. Q.
Prior to the first agreement. No, I don't think. I don't know.
Were you involved in the preparation of any
proposals prior to the first agreement with Omron? A. Q. Gosh, I don't -- I don't recall. Did you prepare any sort of analysis or
information to present to Omron that you gave to Mr. Galasso for any of his communications? A. Q. A. Q. For the acquisition of these patents? For the first agreement. Right. I'm just talking about prior to the first
agreement. A. Q. Right. I don't recall.
Did you participate in any meetings with any
representatives of Omron prior to this first agreement between Verve and Omron? A. Q. Yes. How many meetings?
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 22 of 132
KEVIN IMES
March 10, 2005 Page 22
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
A. Q.
One. Was that a meeting that took place at the
offices of Mr. Nakano in the Washington, D.C. area? A. Q. A. Q. last? A. Q. A. It was a few hours. Who else was there? Ray Galasso; Herb Kerner; Mr. Nakano, And there was one other fellow. His name Yes. When was that meeting? I want to say July, July or August of 2003. How long did that meeting with Mr. Nakano
obviously.
kind of escapes me right now, so ... Q. A. Q. Was it Tom Anderson? It could have been. What was discussed during this meeting with
Mr. Nakano in July, August 2003? A. The business -- well, actually I think it was
more of if we, Verve, thought that the '895 and '200 patents were interesting. And that's where I'm hazy.
I'm not sure if we made a formal proposal there or not to acquire it. Q. What was said, if anything, concerning whether
or not the '895 and '200 patents were interesting to Verve?
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 23 of 132
KEVIN IMES
March 10, 2005 Page 23
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
A.
Technology-wise, more of that; you know, what
the patent included, what it covered. Q. A. What was said about what it covered? We read the patent, so ... I don't have it in
front of me, we'd have to pull it out, but we can certainly go over it if you want to. Q. meeting? A. Q. No. Was any manufacturer of POS terminals or Was Hypercom mentioned during this first
anyone in the industry mentioned during this first meeting? A. Q. A. Q. Yes. Who? Omron. Were any potential targets mentioned at all
during this first meeting with Mr. Nakano? A. Q. No. Were any potential terms of an agreement
discussed during this meeting with Mr. Nakano? A. about. Q. A. Who did the talking on behalf of Omron? I think everyone did. Well, Mr. Nakano and I believe so. The specifics I'm not sure
his counsel.
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 24 of 132
KEVIN IMES
March 10, 2005 Page 24
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Q. A. Q. A.
Mr. Kerner? Yes, and the other fellow. Was the other person there representing Omron? I believe so. He wasn't associated with
Verve, so ... Q. Was there any discussion about transferring
the patents to Verve at that time? A. Well, I'm sure there was. I mean, that's why
we were there. Q. Was there any discussion concerning any sort
of grant-back or temporary transfer of the patents to Verve? A. Q. I don't believe so. Was that the only meeting that you've ever
attended with any representatives of Omron? A. Q. Yes. And to your knowledge, did you have any
further direct communications with Omron after the date of that meeting? A. No. MR. LEACH: Let's mark this exhibit.
(Imes Exhibit No. 2 marked.) Q. (BY MR. LEACH) I'm handing you a document that Is this a
we've marked as Imes Deposition Exhibit 2.
copy or does this include a copy of the first agreement
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 25 of 132
KEVIN IMES
March 10, 2005 Page 25
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
between Omron and Verve? A. Q. It appears to be. And this agreement was eventually signed by
Verve, correct? A. Q. I believe so. Did you sign the agreement on behalf of Verve,
or did Mr. Galasso? A. Q. I believe Mr. Galasso. Do you have any knowledge of the date that
Mr. Galasso signed the agreement? A. Q. No. Were any drafts or previous versions of this
agreement exchanged between the -- Verve and Omron prior to the date that the final version was signed? A. Q. I'm not sure. Were you involved at all in reviewing any
draft agreements prior to the date that this first agreement was signed? A. it over. Q. Do you recall any prior versions of this (Witness reviews document.) I might have read
agreement? A. Q. Not that I can recall. Were there any agreements between Verve and
Omron prior to date of this agreement that I've marked
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 26 of 132
KEVIN IMES
March 10, 2005 Page 26
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
as Exhibit 2? A. Q. Not that I'm aware. Were there any collateral agreements that were
signed contemporaneously with the agreement marked as Exhibit 2? A. Q. I don't believe so. Were there any agreements between Omron and
the Simon, Galasso & Frantz law firm that were made contemporaneously with this? MR. DONAHUE: personal knowledge of that. MR. LEACH: knows, he knows. THE WITNESS: MR. LEACH: just say "I don't know." THE WITNESS: Q. know? A. Q. I don't know. Are you aware or have any information about I don't know. I -If he doesn't know, you can It doesn't matter. If he I object. He does not have
(BY MR. LEACH) So your answer is you don't
any other agreements, written or unwritten, that related -- that were contemporaneous with and related in any way to the agreement of Exhibit 2? A. No. Not that I'm aware of, no.
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 27 of 132
KEVIN IMES
March 10, 2005 Page 27
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Q.
Were there any side agreements with
Mr. Kerner, to your knowledge? A. Q. I don't believe so. Were there any agreements between Mr. Kerner
and Mr. Galasso, to your knowledge? A. Q. No. Were there any agreements between Verve and
the Simon, Galasso & Frantz law firm? MR. DONAHUE: knowledge. MR. LEACH: objection -MR. DONAHUE: MR. LEACH: MR. DONAHUE: MR. LEACH: Yes, it is. -- and you shouldn't make it. It's a valid objection. No, it is not. Listen, in Counsel, that's not a valid Objection, lack of personal
this district the court will stop you from making those kind of objections. That is not -He can answer the question. -- a proper objection. He can answer -That is not a proper
MR. DONAHUE: MR. LEACH: MR. DONAHUE: MR. LEACH: objection. MR. DONAHUE: MR. LEACH:
That is not -If you continue to do that,
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 28 of 132
KEVIN IMES
March 10, 2005 Page 28
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
we'll take it up with the court. MR. DONAHUE: MR. LEACH: objection. MR. DONAHUE: the court. -- we can take it up with Well -That is not a proper
There's no reason to -MR. LEACH: There are only two objections
that are proper:
You can say object to the form of the
question and objection based on privilege. MR. DONAHUE: MR. LEACH: Well -But if you try to give him
objections to tip him off as to what you want him to say -MR. DONAHUE: MR. LEACH: objection. MR. DONAHUE: MR. LEACH: Well -Because every single question I'm not tipping him off. Well, then don't make the
I ask him may be a question he has no personal knowledge of, and he can tell me if that's the case. But that is not a proper objection. that is against the rules and -MR. DONAHUE: MR. LEACH: it. Sid --- I'm not going to permit I'm telling you,
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 29 of 132
KEVIN IMES
March 10, 2005 Page 29
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 I'm making.
MR. DONAHUE:
Sid, but you're way outside
the -- for starters, you're way outside the bounds right now of what the scope of discovery is supposed to be in this case. We're in a personal jurisdictional
case -- excuse me -- discovery on a personal jurisdictional level only. You haven't asked a single I've let a lot go up
question that relates to Arizona.
to now, and I'm just tell you that you're asking him now things that he clearly doesn't have any personal knowledge of. MR. LEACH: MR. DONAHUE: MR. LEACH: That's -And it's --- way beyond the point that
But let me tell you that unless you're
willing to stipulate that there was a conspiracy between Verve and Omron, then I'm entitled to go into this. If you want to stipulate to that, then I don't
need to take discovery right now. MR. DONAHUE: to stipulate -MR. LEACH: take discovery -MR. DONAHUE: MR. LEACH: MR. DONAHUE: -- because that's not true. -- on it. Well, and then I'm allowing All right. Then I have to Obviously we're not going
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 30 of 132
KEVIN IMES
March 10, 2005 Page 30
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
you to take some.
But, I mean, I'm telling you right
now you're getting now to the point where you're asking him questions about Simon, Galasso & Frantz -MR. LEACH: MR. DONAHUE: about. MR. LEACH: Well, he can tell me he That's exactly right -- which he knows nothing
doesn't know anything about, but if he does know information, I'll entitled to find it out. MR. DONAHUE: Okay. Well, I'm guessing
we're wasting our time, though. MR. LEACH: MR. DONAHUE: whether I'll -Q. (BY MR. LEACH) Do you have any knowledge of That's fine. Okay. I'll -- I'll decide
the circumstances under which the agreement that I've marked as Exhibit 2 was negotiated? A. Q. A. The business terms, yes. Tell me what you know about that. I'm vaguely remembering what we had just It's mainly
discussed earlier: revenue sharing -revenue sharing. Q.
Were there subsequent discussions after the
meeting that you attended with Mr. Nakano concerning the terms that ended up as the agreement marked as
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 31 of 132
KEVIN IMES
March 10, 2005 Page 31
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Exhibit 2? A. Q. I believe so. And did those discussions take place between
Mr. Galasso and representatives of Omron? A. Q. A. Q. Yes, they did. And you didn't participate in those, correct? No. Were you kept informed by Mr. Galasso of the
substance of his communications with Omron? A. Q. From time to time. What knowledge or information do you have
about the communications that took place with Omron? A. Gosh, they were phone conversations, so it
would be really difficult to pinpoint what that knowledge is. Q. please. A. More on whether -- I guess whether we're going Can you tell me anything that you remember,
to have a deal with Omron to acquire the assets, just kind of a status update. Q. When did you become aware that there would be
an agreement between Verve and Omron? A. Q. A. Shortly after the meeting. Shortly after the meeting with Mr. Nakano? Correct.
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 32 of 132
KEVIN IMES
March 10, 2005 Page 32
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Q.
How far in advance of the August 13, 2003 date
on which Mr. Nakano signed Exhibit 2 did you find out? A. Q. I don't know. How far in advance of the August 13, 2003 date
that Mr. Nakano signed Exhibit 2 did the meeting with Mr. Nakano take place? A. I think I told you it was July or August. I'm
not sure when.
I remember I spent a couple of days in
D.C., and it was summertime, so ... Q. A. Q. So it could have been six weeks or less? I don't know. Do you know whether Mr. Nakano had sought
approval from Japan to sign the agreement of Exhibit 2 prior to your meeting with him? A. I don't think so, or I don't have that
knowledge, I'll say. Q. Do you have any records, such as plane ticket
receipts, charge receipts, that would allow you to determine the date of the meeting with Mr. Nakano? A. Q. A. sure. Q. office? You don't keep any records at your home or I suppose I might, yeah. If you have such records, where would they be? It depends what my CPA did with them. I'm not
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 33 of 132
KEVIN IMES
March 10, 2005 Page 33
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
A.
I may, but I'm not sure if he kept my receipts
or not, so that's what I'm saying. Q. A. Q. A. Q. Who is your CPA? Lawrence Meck. How do you spell Meck? M-E-C-K. Is Mr. Meck a CPA, and is he located in
Austin, Texas? A. Q. A. Q. CPA"? A. Q. A. Q. I believe it's "Lawrence Meck and Associates". Do you know where his office is located? Yes. Off of Spicewood Springs. Uh-huh. Is he affiliated with some firm? He owns his own firm. So is the name of his business "Lawrence Meck,
Do you know what the street address for his
office is? A. Q. A. Q. Sure don't. Do you know what street it is? It's off of Spicewood Springs, yeah. All right. So when you say it's off of
Spicewood -A. Q. I believe it's --- as far as you know it's --
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 34 of 132
KEVIN IMES
March 10, 2005 Page 34
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
A.
I think it's right on there.
Yeah, I think
it's on Spicewood Springs. building faces, but yeah. Q.
I'm not sure which way the
After you learned that there was going to be
an agreement with Omron, did you undertake any activities in connection with licensing enforcement investigating the '895 patent? A. Q. I believe so. At some point did you identify Hypercom as a
potential target? A. Q. A. Yes. When? I'm not sure exactly when. I can tell you it
was in 2003. Q. Was it after the date that Mr. Nakano signed
Exhibit 2? A. Q. It may have been. I'm not sure.
Do you know whether it was before the date
that the agreement was signed? A. Q. I'm not sure. Do you have any more precise information as to
when in 2003 Hypercom was identified as a potential target? A. suit. I don't believe so. Well, prior to filing
So whenever that was, that would be more precise
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 35 of 132
KEVIN IMES
March 10, 2005 Page 35
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
for you. Q. The suit was filed on September 11, 2003, so
it would have been prior to that date? A. Q. Correct. And would have been after the date of the
meeting with Mr. Nakano? A. Q. I -- I don't know. So it's possible that Hypercom was identified
as a potential target prior to the date of the meeting with Mr. Nakano? A. Q. It could be possible, correct. Who was involved in identifying Hypercom as a
potential target? A. Q. A. Q. A. Q. I was. And how did you go about doing that? Internet research and use. What do you mean by Internet research? Online research of point-of-sale terminals. And what exactly did you do in connection with
online research of point-of-sale terminals? A. Looking at the different manufacturers of
point-of-sale terminals that existed. Q. you do? A. I went to their website, looked at the In connection with Hypercom, though, what did
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 36 of 132
KEVIN IMES
March 10, 2005 Page 36
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
products on their website. Q. A. What were you looking for? The products that Hypercom sold at their
website, point-of-sale terminal products. Q. Were you looking for any particular features
or characteristics of those products? A. Q. A. Q. A. I'm sure I was. Which ones? I don't know offhand. How can you be so sure that you were, then? Because -- because I was just generally
looking to see what point-of-sale terminals Hypercom sold, and they have a wide array with different features and functions. Q. A. Q. And that's it? That's all I can remember right now. So you did some Internet research to see if
Hypercom sold POS terminals and that was the basis for filing suit? A. Q. I don't believe that was your question, sir. What was the basis for you identifying
Hypercom as a potential target for the '895 patent? A. Looking at Hypercom's products relative to the
'895 patent. Q. So you looked at Hypercom's products, no
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 37 of 132
KEVIN IMES
March 10, 2005 Page 37
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
particular functions or features, and identified Hypercom as potential target for the '895 patent? A. Q. That's not what I said. All right. Then what did you do to identify
Hypercom as a potential target for the '895 patent? A. Looked at their products relative to the
claims and specification of the '895 patent. Q. And what was it you were looking for relative
to claims and specification of the '895 patent? A. You'd have to show me the '895 patent. I
don't know offhand. Q. Did you obtain any samples of Hypercom
products to test in any way? A. Q. No. Did you make any effort to purchase any
Hypercom POS terminals to test prior to filing suit on September 11, 2003? A. Q. I don't believe so. Did you do any other investigation other than
your Internet research that served as a basis for identifying Hypercom as a potential target for the '895 patent? A. I'm not sure. I may have -- didn't pay
attention to point-of-sale terminals until I read the '895 patent; so I may have started paying attention to
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 38 of 132
KEVIN IMES
March 10, 2005 Page 38
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
them in my day-to-day activities at that point. not sure. Q.
So I'm
What investigation or information formed the
good faith basis for filing the lawsuit against Hypercom in Michigan on September 11, 2003 concerning the '895 patent? A. Q. I don't know. Who was responsible for making any
investigation concerning the Hypercom products that were accused of infringement, if you know? A. suppose. Q. A. question? Q. No. It's intended to be very board. Were you involved in any way in the investigation that served as a good faith basis for accusing Hypercom products of infringement of the '895 patent prior to filing that lawsuit? A. Q. Other than what I told you already, no. Did you have any occasion to use any Hypercom But you weren't involved in doing that? Could you be a little more specific with your The law firm of Simon, Galasso & Frantz, I
POS terminals that formed the basis for your identifying Hypercom as a target for the '895 patent? A. I'm not sure.
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 39 of 132
KEVIN IMES
March 10, 2005 Page 39
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 be?
Q.
Did you have any occasion to observe use of a
Hypercom terminal that formed the basis for identifying Hypercom as a target for the '895 patent? A. Q. I'm not sure. Did you have any occasions to use or observe
anyone using any Hypercom terminals that formed the basis for filing suit against Hypercom in Michigan on September 11, 2003? A. Q. Again, I'm not sure. Were there any specific Hypercom products that
you identified in your Internet research prior to the filing of the lawsuit in Michigan on September 11, 2003? A. I'm sure there were. I'm not sure what those
are offhand. Q. research? A. I'm not sure. I know I made mental records, Did you make any records of your Internet
for sure, but -Q. If you had made any records, where would they
A. Q. A. Q.
Probably stored on my computer. Where at; at your home? I carry a laptop, so ... Do you have the same laptop today that you
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 40 of 132
KEVIN IMES
March 10, 2005 Page 40
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
were using in August 2003? A. Q. No. What computer or laptop were you using in
August and September of 2003? A. Q. A. it. Q. A. Q. A. Q. I'm sorry? Best Buy kept it. You traded it in? It was under a warranty-type situation. When did you obtain the laptop that you're One that broke. Where is it now? Did you discard it? They kept
The Best Buy bone yard, I guess.
using today? A. Q. Sometime in 2004. The laptop that you -- that you used in
August, September 2003, was that the only laptop or computer that you used up until the time that Best Buy replaced it under warranty? A. Q. Correct. And the laptop or computer that Best Buy
replaced it with is the one that you're currently using today? A. Q. That is correct. What is the model number of the laptop that
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 41 of 132
KEVIN IMES
March 10, 2005 Page 41
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
you're using today? A. Q. It's a Sony, a VAIO, so ... Did you -- prior to the time that the laptop
that you were using in September or August of 2003, prior to the time that it was replaced under warranty, did you make any backups of the hard drive? A. Q. A. Q. A. Q. A. Q. A. Q. I believe so. Do you still have those backups today? I'd have to look for them. I may.
If they exist, where would they be? In a box somewhere. At your home? Could be in storage, so ... In storage at your home? My garage, yeah. Do you have any storage space that you rent
anywhere other than your home? A. Q. No. During August and September of 2003, did you
have an Internet service provider that provided you with Internet access? A. Q. I'm not sure. How did you gain access to the Internet during
that time period? A. I use -- my system is wireless; so there's
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 42 of 132
KEVIN IMES
March 10, 2005 Page 42
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
plenty of wireless networks out there that you can access that are free. Q. How did you obtain e-mail service, then, if
you didn't have a provider? A. Your provider doesn't give you e-mail service So you can go to various
unless you request it.
different free e-mail services that are out there. Q. I appreciate that's possible, but can you tell
me what you did for e-mail service, if you know. A. I'm trying to remember if Verve -- my Verve I believe it
e-mail address was working at that time.
was; so that's probably what I would have used, but I don't know. Q. A. Sure. So to answer your question, I'm trying to
narrow it down for you, so ... Q. When you obtained a Verve e-mail address, who
was the provider who hosted that e-mail service for you? A. Gosh, I don't know. We did it through a
marketing company. you. Q.
I could certainly find that out for
I don't know offhand. Who was the company that Verve worked with in
getting that e-mail service? A. Ellis Graphics.
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 43 of 132
KEVIN IMES
March 10, 2005 Page 43
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Q. A. Q. A. Q. A. know. Q. A.
L.S. Graphics? E-L-L-I-S Graphics. Are they located in Austin, Texas? They are. Do you have any knowledge of their address? It's on MoPac -- oh no, it's not. You'd have to look it up. Is Verve still using Ellis Graphics? Yes, we do. You got my accountant and my graphic I don't
artist. Q. e-mail? A. Q.
You want my hairdresser, too? Does your e-mail provider make backups of your
I don't know. Do they provide Verve with backups of any of
the e-mail? A. Q. A. Q. No, they don't. So if they make backups, you don't know? I don't know. Does Verve have any kind of a service
agreement with your e-mail provider? A. question. Q. What I'm trying to find out is if you have Can you be more -I don't understand the
some sort of agreement with them that might provide
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 44 of 132
KEVIN IMES
March 10, 2005 Page 44
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
some terms in there that -- that have some sort of backup responsibilities or disaster recovery capability or something like that. So I'm asking if you have any
kind of agreement with them. A. basis. Q. I, you know, paid for the service on an annual What it includes, I couldn't tell you. Do you know whether there was any kind of a
written agreement that was signed with them? A. Q. I don't believe so. Okay. How do you access the Internet from
your home? A. Q. A. Q. A. Q. Via a wireless network. Provided by whom? Austin -- I'm sorry -- Time Warner Cable. And do you pay for access to that wireless -Yes. -- network? You're a subscriber of Time Warner Cable? A. Q. Yes. Do you have e-mail service through Time Warner
Cable as well? A. Q. Huh-uh, I sure don't. Is the only e-mail address that you use the
one that is the Verve address? A. No.
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 45 of 132
KEVIN IMES
March 10, 2005 Page 45
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Q. A. Q. A. Q. A. Q. A.
What other e-mail addresses do you use? My personal e-mail address. What is your personal e-mail address? Okay. Yes. You're not going to sell it, are you? No. Okay. It's K-R-I-M-E-S-2, that would be the Can I -You want my e-mail address?
number 2, K, the number 2, at yahoo.com. Q. K-R-I-M-E-S-Z-K -- excuse me, I can't read my
own writing. A. Q. K-R-I -K-R-I-M-E-S, the number 2, the letter K, the
number 2, at yahoo.com? A. Q. That's correct, right. Is that the personal e-mail address that you
used in August, September of 2003? A. Q. I don't believe so. When did you start using this e-mail address
as your personal e-mail address? A. Q. A. sure. Q. What e-mail address did you use prior to this I don't know. What -Oh, actually I might have -- yeah, I'm not
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 46 of 132
KEVIN IMES
March 10, 2005 Page 46
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
for your personal e-mail? A. Q. A. You want to write it down? Yeah. K-E-V-I-N at, the number 3, the letter
G-F-O-T-O dot com. Q. During what time period did you use that
e-mail address? A. maybe. Q. Did you have any communications with Raymond Prior to the previous one and up to 2000,
Galasso using your e-mail address of [email protected]? A. Q. Probably from time to time. Did you have any communications with Raymond
Galasso using your e-mail address [email protected]? A. Q. Possibly. I'm not sure, so ...
Did you have any e-mail communications
relating to Verve using your e-mail address [email protected]? A. No, I don't believe so. MR. LEACH: this point. The VIDEOGRAPHER: The time is 10:09 a.m. (Recess from 10:09 to 10:20; Imes Exhibit No. 3 marked.) We're off the record. Why don't we take a break at
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 47 of 132
KEVIN IMES
March 10, 2005 Page 47
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 record. Q.
THE VIDEOGRAPHER: The time is 10:20 a.m.
We're back on the
(BY MR. LEACH) I've handed you as Exhibit 3 a
copy of a document produced in this case with production No. Omron 193. Is this a copy of an
agreement that was signed by Mr. Nakano at Omron relating to the '895 patent and the '200 patent, if you know? A. Q. I believe so. It's what it reads.
Do you have any understanding of the purpose
for having Mr. Nakano sign Exhibit 3? A. Q. Looks like an assignment. My question was, do you have any understanding
of the purpose for having him sign this? A. He's a representative of Omron and he's
assigning the '200 and '895 patents, or it's what it looks like. Q. Is this a document that was recorded in the
Patent and Trademark Office, if you know? A. Q. I -- I don't know. Had Verve already decided to file suit against
Hypercom by the time Mr. Nakano signed Exhibit 3 on September 5, 2003? A. Q. I don't know. Did you conduct any investigation concerning
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 48 of 132
KEVIN IMES
March 10, 2005 Page 48
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Hypercom or its products accused of infringement in the Michigan case between September 5, 2003, the date that Mr. Nakano signed Exhibit 3, and September 11, 2003, the date that Hypercom was sued in Michigan? A. Q. I don't know. Had the complaint against Hypercom already
been drafted by September 5, 2003? A. Q. I don't know. Was Omron informed that Verve was about to
file suit against Hypercom? A. Q. I don't know. Do you have any knowledge or information about
whether Herb Kerner was aware that Hypercom [sic] was about to file suit against Hypercom prior to the date that the Michigan lawsuit was filed? A. Can I ask her to read that back, please? It
was kind of long. Q. A. Q. I can ask it again. Okay, great. Do you have any knowledge or information
concerning whether Herb Kerner was aware that Verve was about to file suit against Hypercom prior to the date that the Michigan lawsuit was filed? A. I thought you said Hypercom against Hypercom,
so that's why I was a little confused by your question.
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 49 of 132
KEVIN IMES
March 10, 2005 Page 49
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Q. Q.
I don't know. Do you have any knowledge or information
concerning the extent to which Verve coordinated with either Herb Kerner or Omron prior to the date that the Michigan lawsuit was filed on September 11, 2003? A. Q. you know? A. I don't know. (Imes Exhibit No. 4 marked.) (BY MR. LEACH) Let me hand you a document that This is I don't know. Who would know the answer to that question, if
I've had the court reporter mark as Exhibit 4. a copy of U.S. Patent No. 4,678,895.
This is the
patent that we've been referring to as the '895 patent, correct? A. Q. Yes, it is. And this is the patent that was the subject of
the lawsuit filed against Hypercom in Michigan on September 11, 2003, correct? A. Q. I believe it was, yes. Now, earlier you indicated that if you had a
copy of the '895 patent you could tell me what functions or features you were looking for in Hypercom products. A. Sure.
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 50 of 132
KEVIN IMES
March 10, 2005 Page 50
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Q.
Can you tell me what functions or features you
were searching for in Hypercom products that served as the basis for suing Hypercom in Michigan on September 11, 2003? A. Well, you'd have to show me their product
literature at that time. Q. A. Well, what do you remember; anything? Sir, I haven't reviewed Hypercom's products in
a very long time; so it's very difficult for me to give you an answer to that question. Q. Well, what functions or features were you
looking for in Hypercom products, if any? A. Any function or feature that may be described
in the patent. Q. A. website. Such as? I don't know, I'd have to see Hypercom's So everything in the patent would be features
and functions that I would be looking for. Q. Well, you don't need to know what Hypercom has
on its website in order to answer the question what you were looking for. You might need that to tell me what Can't you tell me
you were -- what you actually found.
what you were looking for in Hypercom products, if anything? A. Everything in the patent.
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 51 of 132
KEVIN IMES
March 10, 2005 Page 51
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Q. A.
What do you mean "everything in the patent"? Any functions or features that are described
in the patent as they relate to Hypercom products. Q. So you were just looking at what was described
in the patent, not what was claimed? A. Well, we need to clarify something. When I
say "the patent," I mean everything in the patent, including the claims. Q. So you were looking for anything described in
the -- anywhere in the patent or in the claims; is that your answer? A. Q. A patent to me is inclusive of the claims. That's not my question. Were you looking for
anything in Hypercom products that was described in the patent or in the claims? A. Q. Yes. And that was the basis on which you designated
Hypercom products as allegedly infringing the '895 patent? A. Q. Sure, yeah. Initially, I guess you could say.
Are -- did you ever investigate any
point-of-sale terminal that you concluded did not infringe the '895 patent? A. Q. I suppose. I'm not sure.
Well, tell me what you remember, if anything.
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 52 of 132
KEVIN IMES
March 10, 2005 Page 52
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
A. Q.
Offhand, I don't know. Now, you're aware that prior to the date that
the application for the '895 patent was filed there were point-of-sale terminals in use, both in the United States and Japan, correct? A. I'm not sure. I suppose there were. I was
pretty young then, so I'm not sure if there were. Q. Sure. When were you born? A. Q. In 1965. So you would have been 18 years old when the
application for the '895 patent was filed in 1983? A. Seventeen or 18. Didn't have a credit card;
so I don't know. me any. Q. A. Q. A.
They were pretty smart in not giving
Your parents didn't let you have a -That's right. -- credit card back in those days? Yep. Not that my wife lets me use it much now
either, so ... Q. Did you create any claim charts or records
where you compared any Hypercom products with any of the claims of the '895 patent prior to the date that the lawsuit was filed against Hypercom in Michigan on September 11, 2003?
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 53 of 132
KEVIN IMES
March 10, 2005 Page 53
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 so?
A. extent. Q.
I may have had notes, but I'm not sure to what
Can you answer that yes or no?
I mean, do you
have them or not? A. Q. I don't know. If you did have them, would they still be in
existence? A. Therein lies the rub. I'm not using the same
computer system right now.
I may have a backup of
them, but I'm not sure if I do or not. Q. All right. So if there were any records, they
would not be in existence unless they appear on a backup of the old computer you no longer have; is that fair? A. Well, unless I communicated them to counsel,
which I may have done. Q. Do you have any recollection of having done
A.
Not offhand. (Imes Exhibit No. 5 marked.)
Q.
(BY MR. LEACH) I've asked the court reporter
to mark as Exhibit 5 a document that has been produced in this litigation by Omron. Is this a copy of an
agreement between Omron and Verve relating to the '340 patent and the '341 patent?
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 54 of 132
KEVIN IMES
March 10, 2005 Page 54
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
A. Q.
It appears to be, yes. Were there any other agreements between Verve
and Omron between the date of Exhibit 2 and Exhibit 5 other than the assignment agreement that we've marked as Exhibit 3? A. dates. Q. Okay. Exhibit 2 was signed by Mr. Nakano You gotta help me out there. I need some
in -- on August 13th, 2003. A. Q. Okay. And those agreements related to the '895 and
the '200 patents. A. Q. Okay. Were there any other agreements between Verve
and Omron prior to the date that the agreement of Exhibit 5 was signed? A. Q. A. Q. I don't believe so. Do you know what date Exhibit 5 was signed? I don't. The agreement on the last page has dates of
October 14, 2003 by both Mr. Nakano's signature and Mr. Galasso's signature. Do you have any knowledge or
information concerning whether or not this agreement was actually signed on October 14, 2003? A. I don't.
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 55 of 132
KEVIN IMES
March 10, 2005 Page 55
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Q.
Do you have any knowledge or information
concerning whether or not these signatures were back-dated? A. No. I know we acquired the patents. (Imes Exhibit No. 6 marked.) Q. (BY MR. LEACH) Exhibit 6 is a copy of a
document that's been previously marked and identified in this case with Omron production No. 538, and this has been identified as a copy of the message that Mr. Nakano sent to Japan seeking authorization to sign the agreement of Exhibit 5. And the record indicates that this request for authorization is dated October 28, 2003, which is after the dates indicated on Exhibit 5. Do you know or have any knowledge as to whether or not the agreement of Exhibit 5 was signed before Mr. Nakano asked for authorization to do so? A. Well, first, it's written in Japanese; so I
really don't know what it really says. Q. But my question is, do you have any knowledge
or information concerning whether or not Exhibit 5 was signed before Mr. Nakano requested authorization? A. I've never seen this before, so I don't know.
What was the title of the document, again? Q. That's -- that's really not necessary for my
(512) 328-5557 3101 Bee Caves Road #220
ESQUIRE DEPOSITION SERVICES AUSTIN, TEXAS 78746
Fax (512) 328-8139 (800) 880-2546
Case 2:04-cv-00400-PGR
Document 86-2
Filed 12/23/2005
Page 56 of 132
KEVIN IMES
March 10, 2005 Page 56
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24