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Unsealed Caldera files detail MS evidence shredding claims

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MS on Trial Evidence given under oath that Microsoft deliberately destroyed evidence that could be used in pending or forthcoming antitrust actions has finally come to light. Although its existence had been generally known, Microsoft has succeeded keeping it secret until now. But following an application by the Salt Lake Tribune, the San Jose Mercury and Bloomberg to unseal documents in the now-settled Caldera case, Judge Ronald Boyce released some of the sealed filings. Amongst the sealed pages were some extraordinary things: the lengths of golf course holes in China, photographs of a woman and an insect, published articles, and many blank pages. Caldera argued that the designations were "done by monkeys", but Microsoft protested that the purpose of these was to discourage other potential plaintiffs rather than the media. Boyce concurred with both viewpoints but unsealed most documents, noting that "Microsoft would have liked to have tried this case in secret... there are sharks circling out there, and this isn't going to be the only antitrust action that's going to be filed against Microsoft...". A deposition by Stefanie Reichel, then a Microsoft OEM account manager in Germany, is a key smoking pistol. She said that pressure had been put on her to destroy hundreds of emails that could have proved to be incriminating in the case brought by the DoJ, as well as by Caldera and others. Reichel had been an "uncooperative witness," and had hired a prominent LA lawyer to help her to resist attempts by the DoJ to gain co-operation. It was suspected that Microsoft was paying her legal bill. Juergen Huels, then in charge of Microsoft's German OEM accounts, was accused of telling Reichel to delete any "questionable" emails that could "be problematic" in an investigation. Huels physically removed the hard disks lest they be examined forensically, and they were evidently dumped in "graveyards in East Germany that no-one knows about". Huels changed jobs shortly afterwards and, bizarrely, went to work for Star Division as a VP for sales. The problem for Microsoft, one on which Ballmer was keeping a watchful eye, was that major German OEM Vobis preferred DR-DOS to MS-DOS. The only way that Microsoft could persuade Vobis to change was by agreeing to pay Vobis for the cost of the copies of DR-DOS that Vobis had, and to give Vobis favourable terms for MS-DOS. When the deal was agreed between MS OEM VP Joachim Kempin and Theo Lieven of Vobis, the DR-DOS authenticity holograms that Kempin bought were to be used to decorate his office, the deposition notes. Some details of Reichel's story were given shortly after Reichel's deposition in an article by Wendy Goldman Rohm in Red Herring, although she did not name Reichel. This incensed Microsoft, and resulted in Microsoft filing a contempt complaint against Caldera for allegedly leaking the deposition, which had been obtained from Reichel by Steve Hill, a lawyer acting for Caldera. Rohm also said that Gates gave a handwritten instruction saying "purge e-mail", but when Gates was confronted with this by DoJ lawyers, Gates' lawyers would not let him answer the question. Stephen Susman, the intended trial lawyer for Caldera, noted at the time that Microsoft was "seeking to hold us in contempt for things that I said at a deposition that I took of CEO Bill Gates... their theory is that anything that goes on in the conference room is covered." Hill said that Reichel had "produced a number of documents at her deposition that should have been produced by Microsoft" and that "she alluded to documents we've never even seen". Microsoft subsequently dropped the contempt claim. A complicating factor was that Reichel was Gates' girlfriend for a time (as was lawyer Bill Neukom, at the same time it seems) [We think Graham lost it here, but we left it in because it's funny - Ed]. Reichel left Microsoft to join the marketing team of the San Francisco Yacht Club's entry for the Americas Cup team, subsequently leaving to become VP of business development with freeshop.com, a Seattle Internet start-up. It had long been suspected that many documents that should have been produced had disappeared, but Reichel's deposition appears to be the only evidence of this given under oath. We previously related the stratagems that Microsoft used to get the Reichel deposition excluded from the Microsoft trial. There are potentially very serious legal consequences if, as appears to be the case, Microsoft interfered with the course of justice. It is known that the DoJ considered the matter, but we shall probably have to wait for the result of the trial before there is any decision about a separate criminal proceeding, although media and public reaction afterwards could play a role in influencing the decision. Since there is no statute of limitations for in such matters, the threat of a possible criminal action will remain. ® See also: Microsoft gets Caldera evidence excluded

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