United States District Court, N.D. California
ORDER REGARDING MOTIONS FOR SUMMARY JUDGMENT RE: DKT.
NOS. 70, 83
C. SPERO Chief Magistrate Judge.
case, brought under the Court's diversity jurisdiction,
concerns disputes arising from the commercial relationship
between Plaintiff MicroTechnologies, LLC
("MicroTech") and Defendants Autonomy, Inc. and
Autonomy Systems Limited (collectively,
"Autonomy"). MicroTech previously served as a
reseller for Autonomy's software products and claims that
Autonomy failed to either deliver software or refund
MicroTech's payment for anticipated transactions that
were never completed with two potential end users,
Hewlett-Packard ("HP") and the Biblioteca
Apostolica Vaticana (the "Vatican Library").
Autonomy counterclaims that MicroTech aided and abetted
former Autonomy directors in breaching their fiduciary duty
by artificially inflating Autonomy's reported revenue and
similar metrics. Both parties also bring claims for unjust
enrichment. The Court held a hearing on March 24, 2017. For
the reasons discussed below, each party's motion for
summary judgment is GRANTED with respect to the opposing
party's unjust enrichment claim, but DENIED with respect
to the remaining claims due to genuine issues of material
The Reseller Agreement and Course of Dealing
2006, MicroTech entered an agreement with Autonomy for
MicroTech to resell Autonomy products (the "Reseller
Agreement"). As is relevant to this action, the
Reseller Agreement provided that MicroTech would market
Autonomy's products to federal government customers and
to "mutually agreed upon commercial customers, "
and that MicroTech would maintain marketing centers with
sufficient demonstration equipment and trained personnel to
demonstrate Autonomy's products and respond to customer
inquiries. Reseller Agreement §§ 3.1(1), 3.1(3),
3.2. MicroTech was also required to ensure that each customer
entered a standard license agreement for the software with
MicroTech. Id. § 3.6. MicroTech's potential
services to end users included "demonstrations,
pre-sales, support, installation, customization, training and
such other consulting or integration of or with respect to
the Autonomy products with third party products."
Id. § 1.1(22).
Reseller Agreement provided that MicroTech would submit a
purchase order to Autonomy, and-assuming Autonomy did not
reject the purchase order, which it retained the right to
do-the products would be "shipped by means and on media
agreed between the parties, and in the absence of agreement
otherwise shall be FTP download or if physical then FOB Point
of Origin." Id. § 5.1. After receiving an
order, Autonomy would issue an invoice to MicroTech for the
amount due, "equal to 90% of the prices listed in the
then current Government Reseller Price List, " and
MicroTech was required to pay within thirty days.
Id. § 5.5 & Ex. B § 2. The Reseller
Agreement specifically provided that MicroTech "shall
not be relieved of its obligations to pay fees owed to
Autonomy hereunder by the nonpayment of fees by an End
User." Reseller Agreement § 5.5. The Reseller
Agreement also stated that it was an integrated contract
representing the entire agreement between the parties,
id. § 14.10, and that "[n]o amendment to,
or change, waiver or discharge of, any provision of this
Agreement shall be valid unless in writing and signed by an
authorized representative of each of the parties, "
id. § 14.10.
2006 until late 2009, MicroTech sold Autonomy products nearly
exclusively to United States government agencies. Jimenez
Decl. (dkt. 83-3) ¶ 4 & n.2. Beginning in 2009,
MicroTech began to sell Autonomy products to commercial end
users at Autonomy's suggestion. See Id. ¶
5; Glass Decl. (dkt. 71) Ex. 4 (Jimenez Dep.) at 49:19-52:15.
According to MicroTech's owner and chief executive
officer Tony Jimenez, Autonomy would frequently call
MicroTech to say that Autonomy had an opportunity with an end
user, and ask what sort of fee would be required for
MicroTech to serve as the reseller on that transaction.
Id. at 384:2-19. Steven Truitt-who served at
different times as MicroTech's chief financial officer,
senior vice president, executive vice president, and chief
operating officer-managed MicroTech's sales of Autonomy
products, and Jimenez was also involved, although he
generally did not play a hands-on role in individual deals.
Glass Decl. Ex. 4 (Jimenez Dep.) at 12:5-13:22, 14:1-15:2,
40:13- 42:6; Glass Decl. Ex. 23 (Esterrich
Dep.) at 17:2-18:1, 22:8-10. John Cronin-who at
various times worked as a consultant for both MicroTech and
Autonomy, see Glass Decl. Ex. 4 (Jimenez Dep.) at
81:3-82:5-emailed Truitt about a number of orders for
commercial end users "ready to go" on December 31,
2009, and attached purchase orders for MicroTech to complete
and return to Autonomy. Bianco Decl. (dkt. 68-5) Exs. A, B.
An email between Cronin and an Autonomy employee indicates
that certain of those deals were closed by March of 2010.
Id. Ex. E.
was employed by MicroTech from approximately 2006 to 2014, at
which time the division he then worked in was sold to a
different company. Glass Decl. Ex. 4 (Jimenez Dep.) at
10:8-11:8. When counsel for Autonomy deposed Truitt, he
refused to answer virtually every question asked of him on
the basis that an answer might incriminate him with respect
to criminal proceedings. See generally Glass Decl.
Ex. 5 (Truitt Dep.).
first declaration describes the structure of a typical
transaction involving a commercial end user as follows:
. . . Autonomy would identify an end-user for the purchase of
Autonomy software and negotiate an agreement for the sale of
the software, inform and provide the details of the
transaction to MicroTech and ask MicroTech to issue a
purchase order for the software. MicroTech would issue a
purchase order for the software, Autonomy would invoice
MicroTech for the cost of the software, Autonomy would
deliver the software to the end-user and Micro Tech would be
paid a fee for its participation, typically ten (10) percent.
In some cases, Micro Tech would advance the costs of the
software to Autonomy and collect from the end-user, and in
others the end-user would pay Autonomy directly and Autonomy
would issue a credit to MicroTech for the payment. In all of
the commercial transactions, Autonomy controlled the details
of the transaction and handled all of the negotiations with
Jimenez Decl. ¶ 5; see also Jimenez Opp'n
Decl. (dkt. 73-3) ¶ 6 ("Although the Reseller
Agreement called for MicroTech to be primarily responsible
for identifying, negotiating, and finalizing Autonomy
software resale opportunities, in practice, it was Autonomy
that took on this responsibility for all the commercial
transactions . . . .").
maintained a separate "enterprise" accounting
system for Autonomy transactions involving commercial end
users, distinct from the "normal" accounting system
that MicroTech used for its government contract business.
Glass Decl. Ex. 23 (Esterrich Dep.) at 117:9-118:15; see
also Id. at 216:14-15 (stating that a purchase order
related to the HP transaction came from Truitt's
accounting system). Chief financial officer Tomas Esterrich,
who did not have access to that system, had difficulty
obtaining documents from Truitt to confirm the validity of
Autonomy transactions involving commercial end users, and
testified that the experience was "very
frustrating." See Id. at 48:1-5, 177:19-178:5,
239:18-21. According to Esterrich, MicroTech paid invoices
from Autonomy regarding government contracts on time, but
invoices related to commercial end users "were primarily
based on [MicroTech] getting paid, " and were not paid
until "money was at the bank, the money had been
transferred into [MicroTech's] bank account." Glass
Decl. Ex. 23 (Esterrich Dep.) at 29:10-30:6. Esterrich
testified that MicroTech had "basically . . . no
risk" on the commercial transactions "because we
were getting paid at the same time we were disbursing the
money. So we didn't make any payments unless we had
payment from the client." Id. at 87:4-8.
According to Esterrich, "most of the payments didn't
come from the clients, they came from Autonomy."
Id. at 257:20-21. In some cases, payments MicroTech
received for a given project were used to pay Autonomy for a
different, older invoice. Id. at 258:13-259:7.
Esterrich believed that this practice of waiting to receive
funds before making payment was based on an informal
agreement between Truitt and his counterparts at Autonomy.
Id. at 134:21-135:4.
testified at his deposition that "MicroTech is at risk
with every transaction, " but that he would not expect
that MicroTech would suffer a loss of the full value of the
transaction if a deal fell through. Glass Decl. Ex. 4
(Jimenez Dep.) at 93:8-16. Jimenez believed that transactions
arranged by Autonomy were "legitimate deals" that
would actually occur, but if a "customer changed his
mind in the 11th hour, [Jimenez] would assume based upon
discussions, [his] personal discussions with the Autonomy
people, that they would help [MicroTech] sell that software
so that [MicroTech] would not be stuck holding that
software." Id. at 93:20-94:9. That
understanding was based on conversations early in
MicroTech's relationship with Autonomy, and Jimenez
believed that it held true for all deals going forward from
that point. Id. at 93:12-94:2. Jimenez testified to
his understanding, however, that if software was not
successfully resold, MicroTech would still be liable to
Autonomy for the full contract price of the software.
Id. at 95:3-96:1.
testified that the primary value that MicroTech's
involvement added to sales of Autonomy software was
MicroTech's status as a minority-owned and
disabled-veteran-owned business, certifications that go along
with that status, and the fact that MicroTech is competent
and manages its invoices correctly. Id. at
122:11-128:13; Jimenez Decl. ¶ 3; Jimenez Opp'n
Decl. ¶¶ 2-5. He emphasized that MicroTech met its
contractual obligation to maintain a marketing center with
demonstration equipment and trained staff, although he was
not aware of whether those resources were utilized with
respect to particular transactions. See Glass Decl.
Ex. 4 (Jimenez Dep.) at 153:14-158:16, 177:8-17, 197:12-18.
number of occasions, Autonomy issued credit memos to
MicroTech for certain transactions, including a credit memo
for $4, 888, 800 for a transaction with Morgan Stanley, a
credit memo for $1, 184, 000 for a transaction with
Manufacturers Life Insurance, four credit memos for $1, 050,
000 each for a transaction with the United States Department
of the Interior, and a credit memo for $768, 500 for a
transaction with Bank of Montreal. Glass Decl. Exs. 24-27.
Jimenez testified that end users sometimes incorrectly paid
the purchase price directly to Autonomy, rather than to
MicroTech, and indicated that in such circumstances Autonomy
might issue MicroTech a credit to cancel the amount that
MicroTech owed, since Autonomy had instead received payment
from the end user. Glass Decl. Ex. 4 (Jimenez Dep.) at
130:21-131:17, 170:1- 5. Jimenez suggested that the credit
memos MicroTech received from Autonomy might have arisen from
those circumstances, or generally from successful
transactions-not from transactions that were not ultimately
completed. See Id. at 130:21-132:12 (discussing a
transaction with Morgan Stanley); id. at 152:8-14
(discussing a transaction with Manufacturers Life Insurance).
Later, in response to questioning from MicroTech's
counsel, Jimenez testified that "we've normally had
credit memos that have come in after we've established a
debt. And it was either satisfied by the government or our
customer paying somebody or it -- the deal went away."
Id. at 383:10-14 (punctuation as in transcript).
second declaration, Jimenez states for the first time that
"[i]n the few instances where Autonomy determined that a
particular transaction could not be completed, it was
understood that Autonomy would make MicroTech whole, and with
the exception of the Vatican Library and HP deals, Autonomy
did." Jimenez Opp'n Decl. ¶ 7. That declaration
also states for the first time that the deals with
Manufacturers Life Insurance, Morgan Stanley, the Department
of the Interior, and Bank of Montreal were "failed . . .
transactions, " and indicates that the credit memos
issued for those transactions were Autonomy's method of
"mak[ing] MicroTech whole." Id.
deal was complete, Autonomy would usually send software
directly to the end user via an FTP server rather than
providing it to MicroTech as an intermediary. Glass Decl. Ex.
4 (Jimenez Dep.) at 144:3-10; see also Jimenez Decl.
¶ 5 (stating that "Autonomy would deliver the
software to the end-user"). MicroTech would "check
to see if [the software was], in fact, there" on
Autonomy's FTP server before providing the password for
Autonomy's server to the end user. Glass Decl. Ex. 4
(Jimenez Dep.) at 349:19-350:3. Jimenez "could find no
instance of [MicroTech] ever downloading Autonomy software
that was not for [MicroTech's] personal use."
Id. at 352:6-8. Jimenez testified that the usual
practice was similar with respect to license keys: MicroTech
did not "get the license key [sic], write them down, and
send them as a standard practice to the end users, " but
instead end users would often "have to get the license
key from Autonomy." Id. at 346:17-347:1;
see also Id. at 349:19-350:5. According to
Esterrich, MicroTech "did not provide financing" to
Autonomy. Glass Decl. Ex. 23 (Esterrich Dep.) at 185:2-6.
time to time, MicroTech would provide certifications to
Autonomy's auditors regarding unpaid invoices.
See Glass Decl. Exs. 29, 41. Autonomy would send a
form letter to MicroTech with a list of invoices and amounts
due, requesting that MicroTech certify their validity, unpaid
status, and that they were not subject to any "side
letters or other agreements, " and return the letter
directly to Autonomy's auditors at Deloitte. Id.
The letters included an area for MicroTech to note any
exceptions, and in some cases MicroTech noted that an invoice
had already been partially or fully paid, or that it should
be "reversed" because there was "no
order" or because the invoice had "not been funded
and the product ha[d] not been delivered, " while in
other cases MicroTech either indicated that there were no
exceptions or left that field blank. Id. The audit
letters were usually (if not always) signed by either Steven
Truitt or Tomas Esterrich on behalf of MicroTech. See
acquired Autonomy in October of 2011, in a transaction not
directly related to the purported transaction to sell
software to HP discussed separately below.
The Vatican Library Transaction
the primary transactions at issue in this case relates to a
purported deal for the Vatican Library to buy Autonomy
software for archiving, processing, and retrieving images of
manuscripts. See Glass Decl. Ex. 7 (Vatican Library
purchase order). Steven Truitt, as chief operating officer,
signed a purchase order dated March 31, 2010 on behalf of
MicroTech for this transaction, which called for shipment of
the software to MicroTech via electronic methods "such
as FTP transfer." Id. Jimenez states in his
first declaration that he personally approved this
transaction. Jimenez Decl. ¶ 6. The payment terms
specified that the "Licensee" would pay Autonomy
$11, 550, 000 within ninety days-i.e., by June 29, 2010.
See Id. The purchase order specifically stated
MicroTech's "agreement to purchase the products and
services referenced above pursuant to the terms of the . . .
Reseller Agreement" and pursuant to the terms stated in
the purchase order itself. Glass Decl. Ex. 7. Autonomy issued
MicroTech an invoice for $11, 550, 000 for the Vatican
Library transaction the same day as MicroTech issued the
purchase order for the transaction. Glass Decl. Ex. 36.
to Autonomy's chief financial officer Christopher Yellen,
Autonomy recognized $11 million in revenue for the Vatican
Library transaction in the first fiscal quarter of 2010,
which ended in March of that year. Yellen Decl. (dkt. 74-1)
testified that MicroTech entered into the Vatican Library
transaction and committed to pay Autonomy more than eleven
million dollars based on a press release from the Vatican
Library stating that it intended to use Autonomy software.
Glass Decl. Ex. 4 (Jimenez Dep.) at 230:19-231:22. Jimenez
testified that, as an incentive for Autonomy to use MicroTech
as a reseller, he told Autonomy salespeople that "if we
win that Vatican deal, I'm taking you guys to the
Superbowl [sic]" because he was "always trying to
incentivize the Autonomy salespeople to remember [MicroTech]
when they walked in to do a deal." Id. at
360:18-361:2. According to Jimenez, MicroTech and Autonomy
signed the deal for the Vatican Library within a matter of
days after Steven Truitt informed Jimenez that Autonomy had
called to offer MicroTech the opportunity. Id. at
390:18-391:11. Jimenez states in his first declaration that
the Vatican Library was "Autonomy's customer, "
and that Autonomy "handled all of the negotiations and
MicroTech had no direct contact with the Vatican
Library." Jimenez Decl. ¶ 9. Jimenez testified that
Steven Truitt told him that Autonomy had established a price
that the Vatican Library would pay, and that Autonomy
represented to Truitt that it would sell the software to
MicroTech (to resell to the Vatican Library) at a discount
from that price. Glass Decl. Ex. 4 (Jimenez Dep.) at
provided several letters to Autonomy's auditors
certifying that the Vatican Library invoice was properly
charged, entirely or partially unpaid, and not subject to
side letters or other agreements. Glass Decl. Ex. 29 at
¶ 001021, MT001852-53, MT002008, MT002265-66 6 Ex. 41 at
AU-MT001303-04, AU-MT002021-22. Those letters were dated July
8, 2010 ($11, 500, 000 unpaid); October 6, 2010 (same);
January 26, 2011 ($6, 728, 668.29 unpaid); April 19, 2011
(same); July 12, 2011 ($4, 611, 798.29 unpaid); and July 14,
2011 (same). Id. On each of those letters, MicroTech
wrote "none, " "no exceptions, " or
"not applicable" in the space to note exceptions,
or in one case only noted an exception applicable to a
different invoice. Id. Esterrich nevertheless
testified to his understanding that the Vatican Library
transaction fell within the scope of the practice that
MicroTech would not pay Autonomy until MicroTech itself had
received payment, even though that agreement deviated from
the written Reseller Agreement and was not explicitly noted
in any of the audit confirmation letters that MicroTech
provided to Autonomy's auditors. Glass Decl. Ex. 23
(Esterrich Dep.) at 147:13-14, 177:6-14.
Cronin emailed Steven Truitt on October 13, 2010 to say that
a pending $500, 000 payment was "very time
sensitive" and should be directed to MicroTech's
debt for the "Vatican" transaction. Glass Decl. Ex.
10. Truitt responded that he would talk to Esterrich about
making the payment, id., and the payment was made
the following day, Glass Decl. Ex. 13. MicroTech made another
payment of $4, 321, 331.71 on December 31, 2010-the same day
that it received payment from Autonomy for the ATIC project
discussed below-as well as payments of $2, 000, 000 on April
21, 2011 and $2, 400, 000 on June 30, 2011. Id.
Autonomy wrote off the remaining balance of $2, 328, 668.29
in September of 2011, meaning that MicroTech paid a total of
$9, 221, 331.71 for the Vatican Library transaction. See
January 16, 2011, Esterrich sent an email to Jimenez stating
his intent to transfer two million dollars to Autonomy the
next day for the Vatican Library transaction. Id. at
209:7-12. He testified at his deposition that "some
money had to be in our account, " that "[t]he only
way [he could] make a payment is if we have the money in the
account based on the agreement that we had that once we get
paid, we pay it out, " and that the reason the payment
was to be made the next day was likely because the money was
not yet in MicroTech's account. Id. at
209:12-210:10; see also Id. at 258 ("Some money
has to come from some place before I sent them."). As
noted above, however, financial records indicate that
MicroTech did not make a $2, 000, 000 payment to Autonomy for
the Vatican Library transaction until April of 2011. Glass
Decl. Ex. 13.
believed that Autonomy had in fact completed a deal with the
Vatican Library to sell the software at issue, based in part
on a telephone conversation between Truitt and an Autonomy
employee (likely Joel Scott) that Jimenez overheard when he
walked into the room where Truitt was using the telephone.
Glass Decl. Ex. 4 (Jimenez Dep.) at 329:11-331:10. Although
Truitt wrote in an email dated April 20, 2010 that MicroTech
had received the software that was the subject of the Vatican
Library transaction, Glass Decl. Ex. 14, and an email from
John Cronin indicated that the software had been delivered on
a disk on March 31, 2010, id. Ex. 15, Jimenez
testified that Truitt was mistaken and the email was not
accurate because MicroTech did not receive license keys for
the software, because MicroTech did not receive the software
on a disk, and because the FTP link that MicroTech received
was not functional, id. Ex. 4 (Jimenez Dep.) at
232:14-235:5, 239:10-240:5, 243:10-244:6, 248:18-249:4,
252:6-12. Christopher Yellen states in a declaration
submitted with Autonomy's reply brief that "an
entity like MicroTech . . . may request" license keys
after it has downloaded Autonomy software, but that MicroTech
never made such a request with respect to this transaction.
2d Yellen Decl. (dkt. 76-1) ¶ 4.
believes that MicroTech was "cheated" by Autonomy
on the Vatican Library deal, regardless of whether the
software and license keys were ever delivered to the Vatican
Library. Glass Decl. Ex. 4 (Jimenez Dep.) at 235:6-237:9,
24:20-242:10, 244:7-10. According to Jimenez, when the deal
for HP to acquire Autonomy was announced, he resolved to wait
"until the dust kind of settles around the
acquisition" before requesting that HP "please
figure out what the hell is going on with [MicroTech's]
Autonomy deal at the Vatican and why [MicroTech] ha[d] still
not been paid." Id. at 334:2-10. In the period
from 2011 through 2013, Jimenez asked Truitt to reduce the
amount of business MicroTech did with Autonomy and to
"put more paper on these deals" to reduce risk
and ensure an evidentiary record in case of litigation,
particularly in the event that Autonomy went out of business.
Id. at 338:15-339:1. Jimenez asked Truitt not to
"do any more deals where we did verbal deals without all
of the paperwork in place, " because "[t]here was a
lot of that going on." Id. at 340:1-4.
MicroTech made its last payment to Autonomy for the Vatican
Library transaction, MicroTech "reached out to Autonomy
on several occasions asking for the status" of the
transaction, and Autonomy told MicroTech that it was still
being negotiated but would eventually close. Jimenez Decl.
¶ 9. Jimenez sent a letter directly to the Vatican
Library dated April 23, 2014 stating that Autonomy had asked
MicroTech in 2010 to serve as a reseller for an ongoing
project between Autonomy and the Vatican Library, and that
MicroTech had purchased $11, 550, 000 worth of software but
had never been paid. Glass Decl. Ex. 9. Jimenez noted a March
2014 press release by another company, NTT Data Corporation,
indicating that it had been selected by the Vatican Library
for what Jimenez believed was the same project. Id.
Jimenez sought to obtain confirmation from the Vatican
Library that it received and used Autonomy software, and to
obtain payment to MicroTech for the software. Id. By
letter dated May 15, 2014, Monsignor Cesare Pasini of the
Vatican Library forwarded Jimenez's letter to "HP
Autonomy, " stating that Jimenez's assumption that
the Vatican Library used Autonomy software was
"absolutely false, " and that "the current
project with NTT DATA is completely new and uses software of
NTT DATA and third-party providers, different from Autonomy
and MicroTech." Id. Pasini went on to explain:
As you well know, [the Vatican Library] has never dealt with
the company MicroTech and was not even aware of its
involvement with Autonomy at the time of the latter's
contacts with [the Vatican Library] to analyze the
possibility of a possible collaboration in the digitization
project. As you are aware, this collaboration between
Autonomy and [the Vatican Library] was never formalized, and
from 2011 Autonomy and [the Vatican Library] have ceased to
Id. Pasini asked Autonomy to clear up the matter
with MicroTech. Id. Jimenez states that soon after
that, he learned for the first time from the media that
Autonomy's transaction with the Vatican Library had
"fallen through." Jimenez Decl. ¶ 9.
and July of 2013, counsel for Autonomy and HP (which had by
that time acquired Autonomy) sent letters to the United
States Air Force stating that Autonomy's previous
management had used transactions with resellers to
artificially inflate Autonomy's stated revenue, and
presented the Vatican Library transaction as an example.
Jimenez Opp'n Decl. Exs. A, B. Jimenez states in a
declaration that the letters led to proceedings by the Small
Business Administration, which ultimately cleared MicroTech
of any wrongdoing. Jimenez Opp'n Decl. ¶ 13.
The ATIC Facility
developed a demonstration facility known as the Advanced
Technology Innovation Center ("ATIC"), or later the
"I2C, " short for "Innovation &
Integration Center."MicroTech submitted a twenty-eight page
proposal to Autonomy for creation of the ATIC
"featuring" Autonomy software in November of 2010.
Jimenez Decl. ¶ 13 & Ex. 2. The record includes a
number of internal Autonomy emails and detailed memoranda
discussing MicroTech's proposal, substantially all of
which stated support for Autonomy investing in the project.
Bianco Decl. Exs. O-Q. On December 30, 2010-one day before
MicroTech's first multi-million dollar payment on the
Vatican Library project-Autonomy issued a purchase order to
pay MicroTech $9, 600, 000 for a "3 Year Option"
related to the ATIC, with payment due the following day.
Glass Decl. Ex. 11; Bianco Decl. Ex. W. Autonomy now
contends that its payment for the ATIC transaction was a sham
to allow MicroTech to repay its debt for the never-completed
Vatican Library, and thus to allow Autonomy to recognize
revenue; MicroTech contends that the ATIC deal was a
legitimate transaction to promote Autonomy products at the
ATIC, and was not related to the Vatican Library transaction.
testified that the ATIC facility included a display of
Autonomy software, but that other companies' products
were also on display, including "SGI" and "a
whole bunch of brands." Glass Decl. Ex. 23 (Esterrich
Dep.) at 194:16-195:2, 200:6-13. Jimenez likened the ATIC to
a car dealership, with the "primary purpose" of not
only encouraging customers to buy Autonomy products, but
specifically to buy them through MicroTech. Glass Decl. Ex. 4
(Jimenez Dep.) at 385:20-386:19. He states in his first
declaration that he "originally conceived of the ATIC
[as] a perfect platform to showcase Autonomy software."
Jimenez Decl. ¶ 12. According to Jimenez, the ATIC was
also intended to reinforce to Autonomy the degree of
MicroTech's commitment to Autonomy products, and to
demonstrate generally to customers that MicroTech had
significant technical capabilities on par with much larger
corporations. Glass Decl. Ex. 4 (Jimenez Dep.) at
389:3-390:13. Jimenez testified that the ATIC featured
software made by four of five companies, but that the intent
of the facility was to demonstrate and sell Autonomy
software, with the other software serving as "supporting
actors and actresses." Id. at 276:16-18,
281:18-282:3. When MicroTech's counsel asked Jimenez
whether MicroTech used the ATIC "to market software,
other than Autonomy software, " Jimenez responded as
I don't think so. I can't -- I can't think of any
instance where we said, buy this; don't buy Autonomy, or
this is how it runs, but don't -- we're not going to
put Autonomy -- everyone one of the solutions we offered had
an Autonomy capability built into it to make it just that
Because we were huge fans of Autonomy. I thought Autonomy was
just an amazing product, and so did a lot of people in the
environment, including HP, who I think loved Autonomy until
somebody decided they overpaid. And all of a sudden
they've got buyer's remorse.
Id. at 388:3-17. According to Jimenez,
"Autonomy worked closely with [MicroTech] through the
construction of the ATIC." Jimenez Decl. ¶ 13.
issued a press release when the ATIC opened in July of 2011,
which generally touted MicroTech's capabilities and
products. See Glass Decl. Ex. 3. The press release
included quotes from senior officers at SGI Federal and Lee
Technologies expressing their excitement at partnering with
MicroTech on the ATIC, but did not mention Autonomy as a
partner on the project. Id. The only reference to
Autonomy was in a section at the end of the press release
titled "About MicroTech, " which noted-in a list of
relationships with twelve vendor corporations- that MicroTech
was an "Autonomy Added Value Reseller."
believed that vendors' support for the ATIC project
primarily consisted of donating equipment and software, but
some vendors also contributed funding for marketing purposes.
Glass Decl. Ex. 23 (Esterrich Dep.) at 197:1-22. He recalled
a "transaction" with Autonomy related to ATIC, but
testified that "there wasn't money exchanged."
Id. at 200:15- 201:10. Jimenez testified that some
companies besides Autonomy contributed technology to use at
the ATIC, but those other companies did not pay money for the
ATIC project. Glass Decl. Ex. 4 (Jimenez Dep.) at 404:10-15.
According to Jimenez, companies such as CA Technologies and
Microsoft did not pay MicroTech for the use of their software
in the ATIC because their products were not prominently
featured, but were instead used to make the facility and the
Autonomy software functional. Id. at 282:4-284:7.
did not a submit to any other companies partnership proposals
that were as comprehensive as the proposal it offered to
Autonomy, but it approached companies including Lee
Technologies, HP, and Dell with more limited proposals.
Id. at 295:10-297:2. Jimenez testified that the deal
with Autonomy regarding the ATIC was not exclusive because
"Autonomy didn't want that" and it would
"defeat the whole purpose of having an innovation and
integration center, " which was to show Autonomy
software integrated with other companies' products.
Id. at 298:22-301:21. Jimenez testified that he
spoke to a number of Autonomy employees about the ATIC
facility, both before and after construction of the facility
was complete. Id. at 304:6-307:21. Although the ATIC
featured Autonomy software, Jimenez testified that it was
"not a software center" but rather "the
innovation and integration center." Id. at
than one hundred companies toured the ATIC to see
MicroTech's demonstrations of its capabilities.
Id. at 274:6-20. The ATIC shut down in June or July
of 2014 because MicroTech had lost money on it, having
"paid in more than [it was] given by Autonomy."
Id. at 279:16-280:12, 404:7-8. Although the ATIC had
allowed MicroTech to showcase its skills, it did not result
in additional revenue. Id. at 404:4-6.
Autonomy's chief financial officer Christopher Yellen
states that Autonomy did not, to his knowledge, use the ATIC,
and that Autonomy does not have records of using the ATIC.
Yellen Decl. ¶ 3.
testified that "[s]ome of" the $6, 305, 000 that
MicroTech paid to Autonomy when MicroTech had received $9,
600, 000 for the ATIC consisted of "money that had come
in from Autonomy and was going out to Autonomy in payment of