Apacheta Corporation v. Lincare, Inc.MOTION for Partial Summary JudgmentE.D. Pa.February 14, 2017 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA __________________________________________ APACHETA CORPORATION, : A CALIFORNIA CORPORATION : No. 2:16-cv-02030-BMS : Plaintiff, : : v. : : LINCARE, INC., : A DELAWARE CORPORATION : : Defendant. : __________________________________________: APACHETAโS MOTION FOR PARTIAL SUMMARY JUDGMENT For the reasons set forth in the accompanying brief, Plaintiff, Apacheta Corporation (โApachetaโ), hereby moves for partial summary judgment as to liability for breach of contract. Case 2:16-cv-02030-BMS Document 20 Filed 02/14/17 Page 1 of 13 1 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA __________________________________________ APACHETA CORPORATION, : A CALIFORNIA CORPORATION : No. 2:16-cv-02030-BMS : Plaintiff, : : v. : : LINCARE, INC., : A DELAWARE CORPORATION : : Defendant. : __________________________________________: BRIEF IN SUPPORT OF APACHETAโS MOTION FOR PARTIAL SUMMARY JUDGMENT I. Introduction Two controlling principles of Pennsylvania law warrant summary judgment in Apachetaโs favor and a finding that Lincare committed two independent breaches of the partiesโ contract: 1. Contractual terms for acceptance of performance are strictly construed. Under Pennsylvania law, where parties agree to terms for acceptance or rejection of performance, any other means of rejecting performance is a breach. Here, the partiesโ contract required Lincare to reject deliverables within 15 days or they were deemed accepted, and any rejection had to include a written explanation. It is undisputed that nearly four months after receiving a deliverable from Apacheta, Lincare rejected it without explanation. Thus, Lincare breached the contractโs acceptance provision. 2. Conditions precedent to contract termination are strictly construed. Under Pennsylvania law, where parties agree to specific means for terminating a contract, those terms must be followed or the terminating party is in breach. Here, the partiesโ contract expressly required that Lincare provide Apacheta with written notice of a breach and a chance to cure, but it is undisputed that Lincare terminated the contract without following this procedure. Thus, Lincare breached the contractโs termination provision. Case 2:16-cv-02030-BMS Document 20 Filed 02/14/17 Page 2 of 13 2 II. Statement of Undisputed Facts A. Lincare licensed software from Apacheta and engaged Apacheta to provide software services pursuant to a written Software License and Services Agreement. Apacheta provides mobile software applications used in the transportation and delivery of goods, and Lincare supplies and delivers home medical equipment. On December 15, 2014, these parties entered into a written โSoftware License and Services Agreementโ (the โAgreementโ) through which Lincare licensed certain Apacheta software and engaged Apacheta to provide services and ongoing maintenance pertaining to that software. The Agreement is 16 pages long and includes Exhibit A, titled โSoftware and Services Pricing;โ Exhibit B, titled โAnnual Maintenance Plan;โ and Exhibit C, titled โStatement of Work.โ A true and correct copy of the Agreement is attached hereto as Exhibit A.1 Gary Wolsiefer, who at the time was Lincareโs Director of Information Technology, signed the Agreement on behalf of Lincare. Ex. A, Agreement, at 7, 16. The Agreement contains a Pennsylvania choice of law provision, and the parties agree that Pennsylvania law controls this dispute. Id. at 7, ยง 9.12. B. The Agreement contains express language about termination and notice of termination. The Agreement was for an initial three-year term, commencing on the Effective Date of December 15, 2014, and contains conditions precedent to termination: 5. Term and Termination 5.1 Term. Unless otherwise indicated in Exhibit A, the term of this Agreement begins on the Effective Date and continues for a period of three (3) years thereafter, unless terminated sooner in accordance herewith (the โInitial Termโ). Thereafter, this Agreement will renew for additional one year terms (each a โRenewal Termโ, and collectively with the Initial Term the โTermโ) 1 All of the exhibits referred to herein have been attached to the Declaration that accompanies this memorandum. Case 2:16-cv-02030-BMS Document 20 Filed 02/14/17 Page 3 of 13 3 unless Customer provides written notice to Apacheta of its intent to terminate this Agreement at least ninety (90) daysโ prior to the state of any Renewal Term. 5.2 Termination on Breach. If either Party breaches any term of this Agreement, the other Party may terminate this Agreement following thirty (30) daysโ written notice to the breaching Party specifying any such breach unless, within the period of such a notice, all breaches specified therein are remedied. If the breach is one which, by its nature, cannot be fully remedied in thirty (30) days, the Parties shall cooperate to prepare a mutually acceptable plan to cure the breach within such thirty (30) day period and then pursuant to which, the breaching Party shall undertake reasonable, diligent and good faith efforts to promptly remedy the breach. If the Parties are unable to agree upon a plan to remedy the breach within such thirty (30) day period, the non-breaching Party may terminate this Agreement. If, after the Parties have agreed upon a remedial plan, the breaching Party fails to comply with such plan, the non-breaching Party may thereafter terminate this Agreement effective on written notice. Id. at 3, ยงยง 5.1, 5.2 (emphasis added). With regard to notices, the Agreement provides: 9.2 Notices. Any notice required or permitted under the terms of this Agreement or required by law must be made in writing and must be (a) delivered in person, (b) sent by first class registered mail, or air mail, as appropriate, or (c) sent by overnight air courier, in each case properly posted and fully prepaid to the appropriate address set forth below. Id. at 6, ยง 9.2 (emphasis added). C. The Agreement contains express language about the review and approval of service โDeliverables.โ In addition to licensing software to Lincare, the Agreement specifies the services Lincare contracted Apacheta to provide and the manner in which Lincare would review and approve these services, which were specified as project Deliverables. Id. at 3, ยง 4.1 (defining Statement of Work). All such Deliverables were set forth in the Agreementโs Statement of Work, which is Exhibit C to the Agreement. Id. at 13-16. The parties agreed to the manner in which Deliverables would be accepted by Lincare, including that Deliverables that were not rejected would be deemed accepted 15 days after delivery: Case 2:16-cv-02030-BMS Document 20 Filed 02/14/17 Page 4 of 13 4 4.3 Acceptance of Deliverables. Each SOW will describe, if applicable, the deliverables that Apacheta is obligated to furnish to Customer hereunder (collectively, the โDeliverablesโ) and the acceptance criteria for each of the Deliverables, if applicable (the โAcceptance Criteriaโ). Unless set forth otherwise in a SOW, each Deliverable shall be deemed accepted fifteen (15) days after delivery by Apacheta to Customer (the โAcceptance Date.โ). Id. at 3, ยง4.3 (emphasis added). Moreover, the parties agreed that โ[i]n the event that Customer [Lincare] rejects a Deliverable (i) Customer will set forth in writing and in reasonable detail, the reason for the rejection and (ii) Apacheta shall use commercially reasonable efforts to correct such Deliverable in a timely manner.โ Id. at 15, ยง 2.3 (emphasis added). D. Lincare breaches the Agreement by trying to reject a Deliverable nearly four months after it was delivered and deemed accepted, and by terminating the Agreement without any notice of a breach or opportunity for Apacheta to cure. It is undisputed that the partiesโ project began in January 2015. See Deposition Transcript of Lincareโs 30(b)(6) Witness, L. Reid, (โTranscriptโ) at 70:7-71:5, attached hereto as Exhibit B. According to Gary Wolsiefer, Lincareโs IT Director at the time, as of July 30, 2015, the project had been delayed due to Lincare. See Email from G. Wolsiefer to K. Hermes, dated July 30, 2015 (LINC0007888), attached hereto as Exhibit C. Mr. Wolsiefer retired from Lincare on July 31, 2015, and on October 1, 2015, Linda Reid assumed the new role of Head of Application Technology for Lincare. See Ex. B, Transcript, at 95:10-12. Ms. Reid appeared for deposition on January 11, 2017 as Lincareโs Rule 30(b)(6) witness. See id. Among other things, Ms. Reid admits that on October 5, 2015, Apacheta sent a Deliverable (the โOctober 5, 2015 Deliverableโ) to Lincare, which consisted of a series of Case 2:16-cv-02030-BMS Document 20 Filed 02/14/17 Page 5 of 13 5 functional specifications. Id. at 85:16-25; see also Email from C. Forgeng of Apacheta to R. Batezel of Lincare, dated Oct. 5, 2015 (attaching specifications), attached hereto as Exhibit D. Testifying for Lincare, Ms. Reid admits that Lincare was contractually obligated to review and either approve or reject the October 5, 2015 Deliverable. Ex. B, Transcript, at 179:14-17; 185:8-13. Yet, she also admits that Lincare did not live up to this contractual obligation. Id. at 171:15-175:22. And her conclusion is fully supported by the documents of record, including Weekly Status Meeting Notes that were exchanged each Friday between the parties. According to those documents, on October 9, 2015, Lincare confirmed that it had received and was reviewing the October 5, 2015 Deliverable. See Email from C. Forgeng of Apacheta to R. Batezel of Lincare, dated Oct. 9, 2015 (providing โWeekly Status Meeting Notesโ), attached hereto as Exhibit E. As of October 20, 2015, fifteen (15) days following Apachetaโs delivery to Lincare of the October 5, 2015 Deliverable, Lincare did not take action to reject this Deliverable. Indeed, as of October 20, 2015, Lincare had not provided Apacheta with any notice that Lincare had rejected the October 5, 2015 Deliverable. See Ex. B, Transcript, at 172:5-16. This pattern continued for weeks, with Lincare taking no action to reject the October 5, 2015 Deliverable or to notify Apacheta that it was deficient or insufficient in any manner. Ex. B, Transcript, at 175:1-6. Indeed, on November 20, 2015, Lincareโs executive management team emailed Apacheta simply stating: โLincareโs executive team have not reviewed nor accepted the proposed deliverables.โ See Email from G. McCarthy of Lincare to G. Timmons of Apacheta, dated November 20, 2015, attached hereto as Exhibit F. Then, on February 1, 2016, nearly four months after receiving the October 5, 2015 Deliverable, Lincareโs executive management team sent a letter to Apacheta rejecting the Case 2:16-cv-02030-BMS Document 20 Filed 02/14/17 Page 6 of 13 6 October 5, 2015 Deliverable and terminating the Agreement. The full text of the letter is simply this: Letter from G. McCarthy of Lincare to G. Timmons of Apacheta, dated February 1, 2016, attached hereto as Exhibit G. Ms. Reid admits that at no time prior to this February 1, 2016 letter did Lincare formally reject the October 5, 2015 Deliverable, nor did Lincare ever provide Apacheta with written notice of a rejection, let alone a written explanation of the reasons why this Deliverable was unacceptable, let alone an opportunity for Apacheta to cure any unidentified issues. Ex. B, Transcript, at 176:22-177:4. And Ms. Reid admits this February 1, 2016 letter was the only notice of termination ever provided by Lincare to Apacheta, but that this letter did not identify a breach by Apacheta, let alone give Apacheta an opportunity to cure any unidentified breach. Id. at 223:24-225-22. Case 2:16-cv-02030-BMS Document 20 Filed 02/14/17 Page 7 of 13 7 III. Legal Argument A. Lincare breached the Agreement by improperly rejecting the October 5, 2015 Deliverable and by improperly terminating the Agreement. In order to establish that Lincare breached the Agreement, Apacheta must demonstrate: โ(1) the existence of a contract, including its essential terms, (2) a breach of a duty imposed by the contract and (3) resultant damages.โ CoreStates Bank, N.A. v. Cutillo, 1999 PA Super 14, 723 A.2d 1053, 1058 (Pa. Super. 1999) (citation omitted); Gorski v. Smith, 2002 PA Super 334, 812 A.2d 683, 692 (Pa. Super. 2002). Because Apacheta is seeking partial summary judgment as to Lincareโs liability for breach of contract, only the first two elements are relevant at this time. Under Pennsylvania law, where parties agree to terms for the acceptance or rejection of performance, the failure to reject performance under those terms is ineffective. Personnel Data Sys. v. Grand Casinos, 1998 U.S. Dist. LEXIS 11587, 10-11 (E.D. Pa. July 29, 1998) (where software license agreement provided that acceptance was deemed to have taken place five (5) days after installation, the failure to reject in that time period was ineffective). Likewise, Pennsylvania law provides that conditions precedent to contract termination must be strictly fulfilled. Accu-Weather, Inc. v. Prospect Communications, Inc., 435 Pa. Super. 93, 644 A.2d 1251 (Pa. Super. 1994); see also Arway Linen & Unif. Rental Serv. v. North Phila. Sullivanโs, Inc., 2014 Pa. Super. Unpub. LEXIS 965 (Pa. Super. Ct. 2014) (where plaintiff cured defect in performance, defendant improperly terminated the agreement and was in breach); Mextel, Inc. v. Air-Shields, Inc., 2005 U.S. Dist. LEXIS 1281, 66-67 (E.D. Pa. 2005) (where defendantโs termination letter failed to provide sixty daysโ notice of termination and failed to give plaintiff sixty days to cure the alleged breaches, as required by the partiesโ contract, the termination was improper). And it has long been the law in Pennsylvania that โwhere the contract provides a specific means of cancellation or termination, โneither plaintiff nor defendant can dispense with Case 2:16-cv-02030-BMS Document 20 Filed 02/14/17 Page 8 of 13 8 such manner of cancellation or rescission without the consent of the other.โโ Personnel Data Sys. v. Grand Casinos, 1998 U.S. Dist. LEXIS 11587 (E.D. Pa. July 29, 1998) (citing Wright v. Bristol Patent Leather Co., 257 Pa. 552, 101 A. 844, 845 (Pa. 1917)). Here, there is no dispute that Lincare and Apacheta entered into the Agreement, nor is there any dispute that the Agreement defined the terms by which Lincare could reject a Deliverable, terminate the Agreement, and the manner in which notices had to be provided. See Ex. A, Agreement, at 3, ยงยง 5.1, 5.2 (dealing with termination and notice of termination); id. at 6, ยง 9.2 (dealing with notices); id. at 3, ยง4.3 (dealing with acceptance and rejection of Deliverables); id. at 14-15, ยง 2.3 (same). Ms. Reid, on behalf of Lincare, admits that both the termination and the Deliverable acceptance provisions are clear and unambiguous. Ex. B, Transcript, at 145:12-146:22; 65:16- 67:6. Moreover, Ms. Reid admits that Lincare both (a) failed to adhere to the Agreementโs acceptance procedures with regard to the October 5, 2015 Deliverables and (b) failed to adhere to the Agreementโs termination provision. Id. at 179:14-17; 185:8-13; 171:15-175:22; 176:22- 177:4; 223:24-225:22. Indeed, it is undisputed that on October 5, 2015, Apacheta delivered the October 5, 2015 Deliverable, which Apacheta indicated it was providing for Lincareโs review and approval. Ex. D, Email dated Oct. 5, 2015; Ex. B, Transcript, at 171:15-175:22. Under the plain and unambiguous terms of the Agreement, Lincare had 15 days to either approve or reject this Deliverable, and any rejection needed to โset forth in writing and in reasonable detail, the reason for the rejection.โ Ex. A, Agreement, at 15, ยง2.3. Ms. Reid admits Lincare was obligated to review and either approve or reject this Deliverable, and the documentary evidence proves that for weeks Lincare continually reported to Case 2:16-cv-02030-BMS Document 20 Filed 02/14/17 Page 9 of 13 9 Apacheta that Lincare was in the process of doing so. Ex. B, Transcript, at 167:17-23; 170:14- 24; 171:24-172:16; see also Email Chain Between C. Forgeng of Apacheta and R. Batezel of Lincare, dated Oct. 9, 2015 through Dec. 11, 2015, attached hereto as Exhibit H. It is undisputed that Lincare failed to provide any written rejection of the October 5, 2015 Deliverable within the mandated 15-day time period. Ex. B, Transcript, at 66:17-67-6; 176:22- 177:4. Therefore, as a matter of law, this Deliverable was deemed accepted as of October 20, 2015. Yet, Lincare subsequently breached the Agreement by notifying Apacheta, through the February 1, 2016 letter, that the October 5, 2015 Deliverable was being rejected. In addition to being tardy, Lincareโs February 1, 2016 rejection letter failed to โset forth in writing and in reasonable detail, the reason for the rejection.โ Indeed, as one can plainly see from the letter itself, and as Ms. Reid admits, no reason was given at all. Ex. G, Letter; Ex. B, Transcript, at 223:24-225:22. Accordingly, Lincare breached the Agreement by (a) improperly rejecting the October 5, 2015 Deliverable more than 15 days after it was delivered and already deemed accepted; and (b) failing to provide Apacheta with the contractually-required explanation for the supposed rejection. These breaches were compounded by the fact that Lincareโs February 1, 2016 letter not only purported to reject the October 5, 2015 Deliverable, but it terminated the Agreement. Once again, however, Lincareโs actions clearly contradict the Agreementโs unambiguous terms, under which Lincare could not terminate the Agreement unless Apacheta was in breach. Ex. A, Agreement, at 3. And, before terminating the Agreement, Lincare was obligated to first provide โthirty (30) daysโ written notice to [Apacheta] specifying any such breach,โ and termination Case 2:16-cv-02030-BMS Document 20 Filed 02/14/17 Page 10 of 13 10 could not then occur if Apacheta remedied that breach within thirty (30) days of the required written notice. Id. at 3, ยง5.2. But, as Ms. Reid admits and as is plain to see, Lincareโs February 1, 2016 letter (a) failed to specify any particular contractual breach by Apacheta and (b) failed to provide Apacheta with a chance to cure any breach (as none had been identified). Indeed, Ms. Reid admits that never once during the course of the project did Lincare ever even accuse Apacheta of having breached the Agreement, and never was any written notice of a breach supplied to Apacheta. Ex. B, Transcript, at 146:23-148:24; 150:23-151:19. Therefore, based on the undisputed facts and the clear and unambiguous terms of the Agreement, Apacheta is entitled to partial summary judgment and a finding that Lincare breached the Agreement by (a) improperly rejecting the October 5, 2015 Deliverable and (b) improperly terminating the Agreement. CONCLUSION Pennsylvaniaโs well-established body of contract law gives parties the freedom to establish the terms of their relationship. But once those terms are set, and where the language is clear and unambiguous, contracts must be construed as written. Here, Lincare expressly agreed, in unequivocal terms, to the means by which it could reject Apachetaโs work or terminate the partiesโ Agreement. For reasons known only to Lincare, it opted to bypass these clear contractual terms and to create its own set of rules for accepting and rejecting services from Apacheta. Lincare attempted to reject Apachetaโs work months after it had been implicitly accepted and, even then, failed to provide any explanation, as required by the Agreement. To make matters worse, Lincare then created its own procedure for terminating the entire Agreement - a procedure that not only violated the terms to which Lincare had agreed, Case 2:16-cv-02030-BMS Document 20 Filed 02/14/17 Page 11 of 13 11 but which utterly deprived Apacheta of any chance to cure (to the extent there was even anything to cure). Under Pennsylvania law, Lincareโs actions violated the partiesโ Agreement, and Apacheta is therefore entitled to an order finding Lincare in breach. To the extent a trial will ultimately be necessary, it can and should be limited to the amount of damages Apacheta is entitled to under the Agreement and as a result of Lincareโs breaches. Dated this 14th day of February, 2017. Respectfully submitted, /s/ Gregory J. Star DRINKER BIDDLE & REATH LLP Gregory J. Star, PA Bar I.D. 89389 Alex H. Hayden, PA Bar I.D. 314445 One Logan Square, Ste. 2000 Philadelphia, PA 19103-6996 (215) 988-2734 phone (215) 988-2757 fax Gregory.Star@dbr.com Alex.Hayden@dbr.com Attorneys for Plaintiff, Apacheta Corporation Case 2:16-cv-02030-BMS Document 20 Filed 02/14/17 Page 12 of 13 CERTIFICATE OF SERVICE I, Gregory J. Star, do hereby certify that a true and correct copy of APACHETAโS MOTION FOR PARTIAL SUMMARY JUDGMENT was served on the following by means of the Courtโs electronic filing system: Matthew A. Lipman, Esq. James T. DiMarco, Esq. MCELROY, DEUTSCH, MULVANEY & CARPENTER, LLP 1617 John F. Kennedy Blvd., Suite 1500 Philadelphia, PA 19103-1815 mlipman@mdmc-law.com jdimarco@mdmc-law.com Attorneys for Defendant, Lincare Inc. Dated: February 14th, 2017 s/ Gregory J. Star Gregory J. Star Case 2:16-cv-02030-BMS Document 20 Filed 02/14/17 Page 13 of 13 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA __________________________________________ APACHETA CORPORATION, : A CALIFORNIA CORPORATION : No. 2:16-cv-02030-BMS : Plaintiff, : : v. : : LINCARE, INC., : A DELAWARE CORPORATION : : Defendant. : __________________________________________: DECLARATION OF GREGORY J. STAR IN SUPPORT OF APACHETAโS MOTION FOR PARTIAL SUMMARY JUDGMENT I, Gregory J. Star, hereby declare the following: 1. I am a partner with the law firm Drinker, Biddle & Reath, LLP and am admitted to practice law in the State of New Jersey and the Commonwealth of Pennsylvania and am in good standing. 2. I represent Plaintiffs in the above-captioned matter. 3. I submit this declaration in support of Plaintiffโs Motion for Partial Summary Judgment. 4. I am familiar with the events, pleadings, and discovery in this action and, if called upon as a witness, I could and would testify competently to the matters stated herein of my own personal knowledge. 5. A true and correct copy of the Software License and Services Agreement (as produced by Lincare as LINC0000631) is attached hereto as Exhibit A. Case 2:16-cv-02030-BMS Document 20-1 Filed 02/14/17 Page 1 of 2 6. A true and correct copy of the Transcript of the Deposition of Lincareโs 30(b)(6) Witness, Linda Reid, as taken on January 11, 2017, is attached hereto as Exhibit B. Portions of the transcript cited in the Motion for Partial Summary Judgment have been highlighted in yellow. 7. A true and correct copy of an email from Gary Wolsiefer to Kent Hermes, dated July 30, 2105, (as produced by Lincare as LINC0007888) is attached hereto as Exhibit C. 8. A true and correct copy of an email from Cora Forgeng to Rob Batezel, dated October 5, 2015, (as produced by Lincare as LINC0003919) is attached hereto as Exhibit D. 9. A true and correct copy of an email from Cora Forgeng to Rob Batezel, dated October 9, 2015, (as produced by Lincare as LINC0004259) is attached hereto as Exhibit E. 10. A true and correct copy of an email from Greg McCarthy to Gregg Timmons, dated Nov. 20, 2015, (as produced by Lincare as LINC0004677) is attached hereto as Exhibit F. 11. A true and correct copy of a letter from Greg McCarthy to Gregg Timmons, dated Feb. 1, 2016, (Apacheta-010462) is attached hereto as Exhibit G. 12. A true and correct copy of an email chain between Cora Forgeng and Rob Batezek, dated Oct. 9, 2015 through Dec. 11, 2015, (as produced by Lincare as LINC0004714- 16) is attached hereto as Exhibit H. I hereby declare that the foregoing is true and correct to the best of my knowledge. Dated: February 13, 2017 /s/ Gregory J. Star Gregory J. Star Case 2:16-cv-02030-BMS Document 20-1 Filed 02/14/17 Page 2 of 2 EXHIBIT A Case 2:16-cv-02030-BMS Document 20-2 Filed 02/14/17 Page 1 of 17 Case 2:16-cv-02030-BMS Document 20-2 Filed 02/14/17 Page 2 of 17 Case 2:16-cv-02030-BMS Document 20-2 Filed 02/14/17 Page 3 of 17 Case 2:16-cv-02030-BMS Document 20-2 Filed 02/14/17 Page 4 of 17 Case 2:16-cv-02030-BMS Document 20-2 Filed 02/14/17 Page 5 of 17 Case 2:16-cv-02030-BMS Document 20-2 Filed 02/14/17 Page 6 of 17 Case 2:16-cv-02030-BMS Document 20-2 Filed 02/14/17 Page 7 of 17 Case 2:16-cv-02030-BMS Document 20-2 Filed 02/14/17 Page 8 of 17 Case 2:16-cv-02030-BMS Document 20-2 Filed 02/14/17 Page 9 of 17 Case 2:16-cv-02030-BMS Document 20-2 Filed 02/14/17 Page 10 of 17 Case 2:16-cv-02030-BMS Document 20-2 Filed 02/14/17 Page 11 of 17 Case 2:16-cv-02030-BMS Document 20-2 Filed 02/14/17 Page 12 of 17 Case 2:16-cv-02030-BMS Document 20-2 Filed 02/14/17 Page 13 of 17 Case 2:16-cv-02030-BMS Document 20-2 Filed 02/14/17 Page 14 of 17 Case 2:16-cv-02030-BMS Document 20-2 Filed 02/14/17 Page 15 of 17 Case 2:16-cv-02030-BMS Document 20-2 Filed 02/14/17 Page 16 of 17 Case 2:16-cv-02030-BMS Document 20-2 Filed 02/14/17 Page 17 of 17 EXHIBIT B Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 1 of 68 1 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA 2 3 APACHETA CORPORATION, Case No. 2:16-CV- A CALIFORNIA CORPORATION, 02030-BMS 4 Plaintiff, 5 -vs- 6 LINCARE, INC., 7 A DELAWARE CORPORATION, 8 Defendant. 9 ________________________/ 10 11 12 DEPOSITION OF: LINDA SHARON REID 13 DATE TAKEN: Wednesday, January 11, 2017 14 TIME: 9:05 a.m. to 3:40 p.m. 15 PLACE: Squire Patton Boggs, LLP 16 One Tampa City Center 201 N. Franklin Street 17 Suite 2100 Tampa, Florida 33602 18 REPORTED BY: Mary Ann Browne, FPR 19 Notary Public 20 21 22 23 24 25 Page 1 Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 2 of 68 Page 2 1 APPEARANCES: 2 DRINKER BIDDLE & REATH Gregory J. Star, Esquire 3 Alex H. Hayden, Esquire One Logan Square, Suite 2000 4 Philadelphia, PA 29204-6996 gregory.star@dbr.com 5 Appearing on behalf of the Plaintiff 6 7 McELROY, DEUTSCH, MULVANEY & CARPENTER, LLP 8 Matthew A. Lipman, Esquire 1 Penn Center - Suburban Station 9 1617 JFK Boulevard, Suite 1500 Philadelphia, PA 19103-1815 10 mlipman@mdmc-law.com 11 Appearing on behalf of the Defendant 12 13 ALSO PRESENT: Melissa Zepeda, Esquire Lincare 14 15 16 17 18 19 20 21 22 23 24 25 Page 3 1 I N D E X 2 TESTIMONY OF LINDA SHARON REID PAGE Examination by Mr. Star 5 3 CERTIFICATE OF OATH 263 CERTIFICATE OF REPORTER 264 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Page 4 1 E X H I B I T S 2 NO. DESCRIPTION PAGE 3 Exhibit 1 Revised Notice of Deposition 7 Exhibit 2 Series of Documents 14 4 Exhibit 3 Complaint 23 Exhibit 4 Defendant's Answer to Complaint 23 5 Exhibit 5 E-mail From K. Hermes to C. 24 Forgeng, Dated 1/16/2015 6 Exhibit 6 E-mail Chain 49 Exhibit 7 E-mail Chain, 11/5/14 and 11/7/14 51 7 Exhibit 8 E-mails with Attachment 52 Exhibit 9 E-mail with Attachment 70 8 Exhibit 10 E-mail with Attachment 72 Exhibit 11 E-mails 107 9 Exhibit 12 E-mail, Dated 7/24/15 94 Exhibit 13 Two E-mails, Dated 7/30/15 98 10 Exhibit 14 E-mails 108 Exhibit 15 E-mails, Two pages 112 11 Exhibit 16 E-mails, Three pages 115 Exhibit 17 E-mail From T. Blades & K. Hoefer 128 12 Exhibit 18 E-mails, Two Pages 151 Exhibit 19 E-mail, Functional Specifications 161 13 Exhibit 20 E-mails, Four Pages 164 Exhibit 21 E-mails, Four Pages 177 14 Exhibit 22 E-mails, Seven Pages 186 Exhibit 23 E-mails, One Page 190 15 Exhibit 24 E-mails, Four Pages 204 Exhibit 25 E-mail, Acceptance Criteria 207 16 Exhibit 26 E-mails, One Page 208 Exhibit 27 E-mails, Two Pages 213 17 Exhibit 28 Letter Dates 2/1/16 from Apacheta 218 Exhibit 29 E-mail, One Page 233 18 Exhibit 30 E-mails, Two Pages 234 Exhibit 31 Lincare's Critical Business 240 19 Requirements 20 21 22 23 24 25 Page 5 1 COURT REPORTER: Do you solemnly swear 2 or affirm the testimony you're about to 3 give in this cause shall be the truth, the 4 whole truth and nothing but the truth. 5 THE WITNESS: I do. 6 LINDA SHARON REID, having been first 7 duly sworn, was examined and testified upon 8 her oath as follows: 9 EXAMINATION 10 BY MR. STAR: 11 Q Good morning, I'm Greg Star. I 12 represent the plaintiff, Apacheta. You 13 understand you're here for a Rule 30(b)(6) 14 deposition today? 15 A Uh-huh. 16 Q Yes? 17 A Yes. 18 Q Let's just go over a couple of quick 19 ground rules. I am sure you have spoken with 20 Mr. Lipman about how a deposition will go. 21 Have you ever been deposed before? 22 A Yes. 23 Q How many times? 24 A Just once. 25 Q When was that? 2 (Pages 2 - 5) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 3 of 68 Page 6 1 A I want to say 2015, early 2015. 2 Q In what capacity? 3 A My previous employer. 4 Q Your previous employer was a company 5 called Rotech? 6 A Yes. 7 Q R-O-T-E-C-H? 8 A Yes. 9 Q In connection with what kind of case 10 were you deposed? 11 A Health care, billing. 12 Q So you're basically familiar with how 13 a deposition goes? 14 A Yes. 15 Q I'll ask you questions. You'll give 16 me answers. We need verbal responses, because 17 Mary Ann can't take down the nod of the head. 18 Okay? 19 A Okay. 20 Q If I ask you a question that you just 21 don't understand, please let me know that. This 22 is not a test. I'm not here to try to trick 23 you. I'm here to try to understand the facts 24 that you know. Okay? 25 A Okay. Page 7 1 (Exhibit 1 marked for identification.) 2 BY MR. STAR: 3 Q So the first exhibit that we've marked 4 is a notice of deposition for today. We'll be 5 marking some exhibits. You will get an exhibit 6 label on them, Mary Ann will hand them to you 7 and then I'll ask you some questions. 8 We're going to have quite a few 9 exhibits today. 10 A Okay. 11 Q Just bear with me on that. I know 12 witnesses sometimes get frustrated with the 13 amount of exhibits, but in the day and age of 14 e-mail, we get lots of exhibits. Okay? 15 A Yes. 16 Q Sometimes I'll spend a very short 17 period of time on a particular document. Other 18 times, we'll be back and forth on it in some 19 detail. Okay? 20 A Okay. 21 Q So I've handed you as Exhibit 1 the 22 notice of deposition. Have you seen this 23 before? 24 A Yes. 25 Q I just want to make sure that we have Page 8 1 an understanding of the testimony that's going 2 to be offered today. On behalf of Apacheta, we 3 served Lincare with this notice of deposition 4 for a 30(b)(6) corporate designee. And that 5 person is going to be you, correct? 6 A Yes. 7 Q We've listed on here 22 different 8 topics of inquiry. Have you gone through those 9 previously? 10 A Yes. 11 Q Rather than us going through each one, 12 are there any topics of the 22 that you're not 13 able to testify about today? 14 MR. LIPMAN: I'm just going to object. 15 As I stated to you previously, she can 16 testify -- we believe she can testify, 17 depending on what your questions are, to 18 all 22 of these topics, at least in part 19 and to many in whole. 20 So subject to that objection, she can 21 provide whatever response she can, but some 22 of this gets to be a technical/legal 23 conclusions. 24 MR. STAR: Fair enough. I don't see 25 that as an objection. I think that's what Page 9 1 I was hoping to find out. 2 BY MR. STAR: 3 Q I understand what Mr. Lipman is 4 saying, that if there is particular things -- 5 it's impossible for you to know exactly what I'm 6 going to ask until I ask it. 7 A Right. 8 Q So if there's something that you feel 9 when I ask it, it is not something you are able 10 to testify about on behalf of Lincare, please 11 let me know. 12 MR. LIPMAN: For example, I believe 13 there's one in there that lists all of the 14 documents that Lincare has produced. 15 And you certainly can ask Ms. Reid. 16 She has not gone through page by page, line 17 by line all 6,063 documents. 18 She's seen many of them, as you will 19 see today, but I don't believe there is 20 anybody at Lincare who would be able to 21 testify to every single one of those 22 documents. That would be an example of 23 responding in part. 24 MR. STAR: We'll see how it goes. 25 BY MR. STAR: 3 (Pages 6 - 9) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 4 of 68 Page 10 1 Q Now, let's just make sure we 2 understand. You didn't start at Lincare until 3 October of 2015, right? 4 A Correct. 5 Q You're aware that this case centers 6 around a contract that was executed in December 7 of 2014? 8 A Yes. 9 Q So roughly ten and a half, 11 months 10 before you started, correct? 11 A Yes. 12 Q So obviously there's facts and 13 circumstances that happened in connection with 14 this case that predate your involvement 15 personally? 16 A Yes. 17 Q But today you understand you're here 18 to testify on behalf of the corporation, 19 Lincare, as to everything that happened that's 20 listed in this deposition notice? 21 A Yes, I understand. 22 Q Without you disclosing to me any 23 conversations that you might have had with Mr. 24 Lipman or any in-house attorney at -- you can 25 put that down. Page 11 1 Without you disclosing any 2 conversations with Mr. Lipman or any in-house 3 attorney at Lincare about the case, tell me what 4 you did to prepare to testify today. 5 A I went over my own notes and my own 6 documents, which were provided to legal early 7 on, as well as the documents that were provided 8 as far as e-mails and documents throughout the 9 course of the project. 10 Q When you say notes and documents, what 11 sort of notes are you talking about? Are these 12 handwritten notes? 13 A No, not handwritten notes. It's, you 14 know, in my head. I'm looking at e-mails that I 15 sent or people sent to me, which were still 16 e-mails that were still discoverable. 17 Q Just so I've got this clear, you used 18 the term notes. You're telling me now that 19 there aren't actual notes, though? 20 A I couldn't find any actual handwritten 21 notes. 22 Q In preparation for this deposition and 23 other than speaking with lawyers, did you speak 24 with anybody else? 25 A Not recently. Page 12 1 Q Well, whether recently or not, other 2 than your lawyers in preparation for this 3 deposition, did you speak with anybody else? 4 A Just my boss. 5 Q And who is that person? 6 A Bill Moran. He's the new CIO. 7 Q M-O-R-A-N? 8 A Yes. 9 Q And since when -- strike that. When 10 did Mr. Moran join Lincare? 11 A I'm not sure of the exact date. I 12 want to say it was three or four months ago. 13 Q And what was the substance of the 14 conversation you had with Mr. Moran? 15 A I was just alerting them that I was 16 going to be out of the office and that I was 17 going to be unavailable for a couple of days. 18 Q To prepare for this deposition, did 19 you go back and have conversations with any of 20 the current Lincare employees who had been 21 involved in the project when it first started in 22 late 2014, early 2015? 23 A I had a short conversation with Barnes 24 Marshall. 25 Q When was that? Page 13 1 A Yesterday. 2 Q Other than speaking with Mr. Marshall, 3 have you ever had any other conversations with 4 any other non-lawyers about this case? 5 A No. 6 Q Tell me what the substance was of the 7 conversation you had yesterday with Mr. 8 Marshall. 9 A I was just clarifying the timing on 10 some of the events that I wasn't involved in. 11 Q Why did you speak with Mr. Marshall 12 and not other people? 13 A Because he was heavily involved in the 14 project. 15 Q What was his role in the project? 16 A He was the technical lead. 17 Q What does that mean? 18 A He was in charge of the programming 19 that Lincare had to do and overviewing the 20 programming that Apacheta had to do. 21 Q Not to put words in your mouth, but is 22 it fair to say based on Mr. Marshall's role on 23 the actual project, you viewed him as the most 24 important person for you to speak with? 25 A Yes. He was the most intimately 4 (Pages 10 - 13) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 5 of 68 Page 14 1 involved in the project. 2 Q We're going to come back and obviously 3 talk about lots of different things. What I 4 want to do is get a couple of exhibits marked 5 just so that we have them on the record early on 6 as exhibit numbers. Then we're going to come 7 back and walk through some of these things in a 8 way that makes sense. 9 I'm mostly going to be going in 10 chronological order so that know one gets 11 confused? 12 MR. STAR: Mary Ann, let's mark this 13 document as Exhibit 2, please. 14 (Exhibit 2 marked for identification.) 15 BY MR. STAR: 16 Q So what we have marked here as 17 Exhibit 2 are a series of documents. And you 18 will see in the bottom right-hand corner, 19 there's what we call a Bates number. This says 20 LINC, which refers to Lincare, 630. And if you 21 flip to the last page, it goes to Lincare 646. 22 So the cover page is an e-mail that 23 you guys produced. I don't know why, but when 24 it prints, maybe you as a tech person know, it 25 prints amazingly small. Page 15 1 Are you familiar with what we've 2 marked here as Exhibit 2? 3 A Let me look through it. Yes, except 4 for this e-mail, the initiating e-mail, I have 5 not seen that. 6 Q Fine. Let's talk about the cover 7 e-mail. Do you see it's an e-mail that begins 8 with one sent by Gary Wolsiefer. That's 9 W-O-L-S-I-E-F-E-R. On December 16th, he sends 10 that e-mail to James Wee. 11 Do you see that? 12 A Uh-huh, yes. 13 Q The subject is executed contract? 14 A Yes. 15 Q And then there's an e-mail back at the 16 top from a gentleman named Bob Shireman, 17 S-H-I-R-E-M-A-N, back to Mr. Wolsiefer with a 18 copy of the executed contract, right? 19 A Yes. 20 Q And as we see, there's this Bates 21 number Lincare 630. So this is an e-mail that 22 came from Lincare's files, correct? 23 A Yes. 24 Q And attached to this e-mail was the 25 actual executed software license and services Page 16 1 agreement, correct? 2 A Yes. 3 Q And you're familiar with this 4 contract, correct? 5 A Yes. 6 Q It's something you reviewed in 7 preparation for today's deposition? 8 A Yes, and previous to today's 9 deposition. 10 Q Thank you. So let's go over a couple 11 of things in it. We're going to be coming back 12 to this throughout the day today. Okay? 13 A Yes. 14 Q First off, you agree with me at the 15 top it says that it's entered into as of 16 December 15, 2014 and that's the effective date, 17 correct? 18 A Correct. 19 Q And at the bottom of each page, 20 there's a page number and it begins with page 1 21 and it goes all the way through page 16, 22 correct? 23 A Correct. 24 Q And if you go to page 7, you see that 25 this has been executed on behalf of both Page 17 1 Apacheta Corporation and Lincare, Inc., correct? 2 A Correct. 3 Q And Lincare, Inc. there is identified 4 as the "customer?" 5 A Yes. 6 Q And Gary Wolsiefer, director of IT, 7 signs this on page 7 on behalf of Lincare, 8 correct? 9 A Correct. 10 Q And if you go to page 16, you see 11 another set of signatures dated December 16, 12 2014, correct? 13 A Yes. 14 Q Again, Lincare is identified as the 15 customer? 16 A Yes. 17 Q And, again, Gary Wolsiefer as director 18 of IT signs on behalf of Lincare, correct? 19 A Yes. 20 Q Mr. Wolsiefer as the director of IT 21 was authorized to bind Lincare to a contract, 22 correct? 23 A I'm not aware of that. 24 Q Do you dispute that? Do you think 25 that he was not qualified or authorized to bind 5 (Pages 14 - 17) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 6 of 68 Page 18 1 Lincare to this contract? 2 A I can tell you the policy today is the 3 director level is not allowed to sign contracts. 4 Q What was the policy as of December 16, 5 2014? 6 A I'm not aware of the policy changing. 7 I have seen no policy change. 8 Q Is it Lincare's position in this case 9 that it did not validly bind itself to -- 10 A I'm not saying it's the position -- 11 MR. LIPMAN: Let him finish the 12 question. 13 BY MR. STAR: 14 Q That will happen throughout the day. 15 Is it Lincare's position today, that it did not 16 validly enter into this contract? 17 MR. LIPMAN: Objection. You can 18 answer. 19 A I can't answer that. It's a legal. 20 BY MR. STAR: 21 Q So you have no answer to that 22 question? 23 A No. 24 Q Mr. Wolsiefer left Lincare in or 25 around the middle of 2015, right? Page 19 1 A As far as I know, yes. 2 Q And you replaced him in that position 3 as director of IT? 4 A No. 5 Q We'll come back to this in a little 6 while. Was there any time where you were 7 working at Lincare where Mr. Wolsiefer was also 8 employed there? 9 A No. 10 Q And you personally obviously were not 11 involved in negotiating this contract or signing 12 it, correct? 13 A No. 14 Q Let's go through the component parts 15 of this 16 page agreement. Pages 1 through 7 16 are the actual software license and services 17 agreement, correct? 18 A Yes. 19 Q And then pages 8, 9 and 10 constitute 20 Exhibit A, which is software and services 21 pricing, correct? 22 A Yes. 23 Q Exhibit B, which is pages 11 and 12 24 constitutes the annual maintenance plan, 25 correct? Page 20 1 A Yes. 2 Q And Exhibit C, which is pages 13 3 through 16 is the statement of work? 4 A Yes. 5 Q To your knowledge, when I ask that 6 question, I'm asking on behalf of Lincare 7 itself. 8 Was there ever any actual modification 9 to this contract, this 16-page contract? 10 A Not that I'm aware of. 11 Q Was there ever a change request that 12 was executed to change anything with regard to 13 this contract? 14 A From the SOW, statement of work. 15 Q I'm sorry, I don't understand. 16 A So the statement of work, which is 17 where you have to get to the detail level, that 18 was changed many times. 19 Q Are you aware of an actual change 20 request that changed that? 21 A The project manager for Apacheta 22 changed the requirements many times for us. I'm 23 not sure what you mean by a change request. 24 Q What I mean by a change request is 25 probably what you understand it to mean, which Page 21 1 is a written request for a change in a project, 2 either in the project scope or the project 3 timing or the project price. 4 With that understanding, are you aware 5 of any written signed change request to this 6 contract? 7 A Not to the contract, but to the 8 statement of work. There were many e-mails 9 where we changed the requirements and added 10 requirements and updated requirements. Those 11 are changes. 12 Q Is there any executed -- I'm not 13 trying to trick you here. I'm just trying to 14 get an understanding of where you guys come 15 from. And I'll tell you why. 16 In the answer that Lincare gave to our 17 complaint, Lincare contended that there might 18 have been modifications to this 16-page 19 contract. 20 I'd like to know whether you believe 21 there were actual modifications. And if you 22 believe there were modifications, what those 23 were and how I find them. 24 With that understanding, can you 25 answer that question? 6 (Pages 18 - 21) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 7 of 68 Page 22 1 A There was no change to the contract, 2 but the statement of work is prevailing in this 3 case. And the statement of work is where you 4 get to the detail items, and we went through 5 many, many iterations of requirements. 6 So when you say and the statement of 7 work is part of this contract. And yes, there 8 was lots of changes, additions, things that were 9 not going to work, requirements they could not 10 meet in the statement of work. 11 Q So I understand your answer to be, 12 there was no actual modification or change to 13 the 16-page contract itself? 14 MR. LIPMAN: Objection. You can 15 answer. 16 A To the statement of work, which is 17 part of this contract. 18 Q And we'll come to that and we'll go 19 through it in some detail. 20 MR. STAR: Let's put a couple other 21 exhibits on the record and then we're going 22 to come back and we'll talk about your 23 background a little bit and we'll work our 24 way through the project. 25 Let's mark this as Exhibit 3, please. Page 23 1 (Exhibit 3 marked for identification.) 2 MR. STAR: You can mark that as 4. 3 (Exhibit 4 marked for identification.) 4 BY MR. STAR: 5 Q So what I've marked here as Exhibit 3 6 is a copy of Apacheta's complaint in this case, 7 along with all of the exhibits that were 8 attached to it. And as Exhibit 4 is Lincare's 9 answer to the complaint with affirmative 10 defenses. 11 We're not going to go into any detail 12 on this. If you would like to flip through it, 13 you certainly can. I don't think you need to do 14 that now, but you can see at the top of each 15 page, there's the actual court filing 16 information, which shows what was actually filed 17 on the docket with the court. 18 My only question to you for right now 19 with respect to the complaint is this. Did you 20 have any role when the complaint was received by 21 Lincare? Did you have any role in reviewing the 22 complaint or preparing Lincare's answer to the 23 complaint? 24 A No. 25 Q Without telling me what might have Page 24 1 been discussed, were you consulted in connection 2 with preparing Lincare's answer? 3 A No. 4 Q Were you consulted in any way with 5 regard to coming up with affirmative defenses 6 that Lincare has asserted in this case? 7 A No. 8 Q You're familiar with the allegations 9 of the complaint and the answer that Lincare has 10 given? 11 A Yes. 12 Q And you're able to testify about those 13 when we get into them today? 14 A Yes. 15 Q So you can set those aside and we'll 16 come back to those at some point. 17 MR. STAR: This will be Exhibit 5 18 please. 19 (Exhibit 5 marked for identification.) 20 BY MR. STAR: 21 Q What we have marked here as Exhibit 5 22 is an e-mail labeled Lincare 715. It's from a 23 gentleman name Kent Hermes, H-E-R-M-E-S, to Cora 24 Forgeng, F-O-R-G-E-N-G, on January 16, 2015, and 25 the subject is Lincare Project Contact Page 25 1 Information. 2 So before we get into the details 3 about the project, I thought it would be helpful 4 if we could go through some of the names of the 5 people who we're going to see on different 6 e-mails so we have an understanding of who they 7 are. Obviously, I've never met these folks. 8 So we've already talked about Gary 9 Wolsiefer. He was the IT director. As of 10 January of 2015, what was his role on this 11 particular project? 12 A I would say he's the IT sponsor. 13 Q What does that mean? Is he sort of 14 the executive level sponsor? 15 A Just from an IT perspective, he would 16 be at the top as far as sponsoring. If there 17 was any financial, any money or any costs that 18 we would have to get approved, he would have to 19 do that. 20 Q Would there have been an executive 21 level sponsor for a project like this? 22 A There should be. 23 Q And who would that have been as of 24 January of 2015? 25 A I'm not aware who that was. 7 (Pages 22 - 25) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 8 of 68 Page 26 1 Q Do you know at any point during the 2 project, and just so we have an understanding, 3 that the project contract is signed in December 4 of 2014. We'll go through some of this, but 5 there's a kickoff meeting in early 2015. And on 6 February 1st of 2016, Lincare terminates the 7 project and terminates the contract, correct? 8 A Uh-huh. 9 Q Yes? 10 A Yes. 11 MR. LIPMAN: Objection. 12 BY MR. STAR: 13 Q So we're roughly talking about a year? 14 A Yes. 15 Q During that one year time frame that 16 the project was going on, can you tell me 17 whether there was ever an executive level 18 sponsor for the project from Lincare's 19 perspective? 20 A My understanding is it was the COO. 21 Q And who was that? 22 A The person at this time was, I'll 23 probably mess up his name, Shawn, and I really 24 can't remember his last name. 25 Q So when you say at this time, you're Page 27 1 talking about January of 2015? 2 A Yes. 3 Q And you're referring to Shawn Schabel? 4 A Yes. 5 Q Shawn is S-H-A-W-N. Schabel is 6 S-C-H-A-B-E-L. And he was the chief operating 7 officer? 8 A Yes. 9 Q Was there ever a point in time when 10 you personally worked along with Mr. Schabel in 11 any capacity? 12 A No. 13 Q When did he leave Lincare? 14 A I'm not -- I'm not aware of the date. 15 Q You joined in October of 2015 -- 16 A It was before I joined. 17 Q So let's just let each other finish, 18 because the way this goes, of course, is that 19 you might not care how the transcript reads 20 later on. For us, it's important. We want to 21 be able to get the question out and make sure 22 we've got the full question out. Otherwise, we 23 might understand each other today, but when we 24 read it in some months or somebody else who 25 wasn't here reads it, it's hard to understand. Page 28 1 So Mr. Schabel was gone from Lincare 2 by the time you joined in October of 2015? 3 A Yes. 4 Q When you joined in October of 2015, 5 was there an executive level sponsor for the 6 project? 7 A Greg McCarthy who was the incoming 8 COO. 9 Q So Greg McCarthy took over for Shawn 10 Schabel? 11 A Yes. 12 Q And do you know when Mr. McCarthy 13 joined Lincare? 14 A He's been with the company for many 15 years. I'm not even sure how many years. 16 Q Was he there at the time that the 17 contract was signed in December of 2014? 18 A Yes. 19 Q And do you know if Mr. McCarthy had a 20 role in either negotiating or executing the 21 contract? 22 A No. 23 Q So it was signed by Mr. Wolsiefer. Do 24 you know whether Mr. McCarthy had approved Mr. 25 Wolsiefer signing that contract? Page 29 1 A I do not know. 2 Q Do you know if Mr. Schabel who had 3 been the COO at the time the contract was 4 signed, do you know whether Mr. Schabel 5 authorized Mr. Wolsiefer to sign the contract? 6 A I do not know. 7 Q Where's Mr. Schabel today? 8 A I do not know. 9 Q Do you know why he left the company? 10 A No. 11 Q Do you know whether he's subject to 12 any nondisclosure agreement or any other sort of 13 ongoing contract that prevents him from 14 disclosing any information that he knows? 15 A I do not know. 16 Q Let's go back to Exhibit 5. There's 17 Kent Hermes and it says he's going to be the 18 system development manager. 19 What is that? 20 A He's the IT manager in charge of 21 application development. So programming 22 business systems, the programming side of the IT 23 world. 24 Q And what exactly would he be doing on 25 the project with Apacheta? 8 (Pages 26 - 29) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 9 of 68 Page 30 1 MR. LIPMAN: Objection. Are you 2 asking at the time what was he going to do 3 or what did he actually do? 4 MR. STAR: Thanks. 5 BY MR. STAR: 6 Q So we're looking at a document from 7 January 16, 2016. Mr. Hermes is identified as 8 the system development manager. 9 What would you have understood his 10 role to be? What was he going to do? 11 A He was going to manage the development 12 effort on the Lincare side and the integration 13 with the Apacheta software. 14 Q Let's pause and talk about both of 15 those things. So in connection with this 16 project overall, there's going to be some 17 development work that Lincare itself is going to 18 be responsible for doing? 19 A Yes. 20 Q What is that work? 21 A It was being defined throughout the 22 life of the project. 23 Q But these were Lincare's 24 responsibilities, not Apacheta's? 25 A Yes. Page 31 1 Q You mentioned that Mr. Hermes would be 2 part of -- and Hermes is H-E-R-M-E-S by the way. 3 He would be involved with integration work. 4 I think I understand what that means, 5 but why don't you tell me what he was going to 6 be doing in regards to integration. 7 A Integration would be when we have to 8 get data from the Apacheta system and interphase 9 that data over to Lincare's post system. 10 Q So in layperson's terms, to make the 11 two systems talk to each other? 12 A Yes. 13 Q So other than managing the development 14 effort and the integrations from Lincare's 15 perspective, was there anything else that Mr. 16 Hermes was going to be doing on this project? 17 A I would say just really just the 18 management of the project from the development 19 standpoint. 20 Q Next on this list of Exhibit 5 is Mike 21 Moore, M-O-O-R-E, listed as Enterprise Services 22 Team Lead. 23 What does that mean? 24 A Mike Moore is in charge of IT 25 operations. And IT operations is the actual Page 32 1 physical systems, security, the network 2 operations. 3 Q And what would his role be on the 4 project with Apacheta? 5 A Any system requirements, physical 6 system requirements and security requirements, 7 connectivity requirements. 8 Q Just going back to Mr. Hermes for a 9 second. Obviously, this project involved the 10 development of ultimately a solution that would 11 give Lincare mobile handheld devices for 12 deliveries, right? 13 A It's more than that, but that's one 14 component of it. 15 Q One component of it, but that's 16 generally part of what this project was for? 17 A Generally. 18 Q Mr. Hermes, did he have experience 19 with that sort of software and the kind of 20 hardware that was going to be involved for 21 mobile delivery applications? 22 A I can't answer that. I don't know 23 Kent's background. 24 Q What about Mr. Moore? Did he have 25 that experience? Page 33 1 A I can't answer that. I don't know his 2 background. 3 Q Do you know whether any of the folks 4 listed on Exhibit 5 had that kind of experience? 5 A I can't answer that. 6 Q So the next is Jeff James listed as 7 Enterprise Services. What does that mean? What 8 role would he have? 9 A Jeff James, the Enterprises Services 10 is more the system administration. So hardware 11 administration, also connectivity, security 12 connectivity. So Mike Moore is Jeff's manager. 13 Q Next is Craig Kopetz, K-O-P-E-T-Z. 14 He's listed as Development Team Lead. What 15 would his role have been? 16 A Craig is a senior programmer. So he 17 would be in charge of any programming on the 18 side of Lincare. 19 Q Would that have been in connection 20 with the work that Mr. Hermes was doing for the 21 development effort in the integrations? 22 A Right. At the time, Craig reported to 23 Kent. 24 Q So basically Craig would be doing the 25 same kind of stuff that Kent was doing and 9 (Pages 30 - 33) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 10 of 68 Page 34 1 reporting to Kent? 2 A Kent was not a programmer. Kent was a 3 manager. 4 Q So Craig was the programmer managed by 5 Kent? 6 A Yes. 7 Q See, this stuff is fun. I have to go 8 through and figure out who everybody is. And 9 then last on this list is a guy named Brian 10 MacPhaiden with an unusual spelling, 11 M-A-C-P-H-A-I-D-E-N, Fleet and Purchasing 12 Specialist. 13 What does that mean he would be doing 14 on this project? 15 A Brian would be in charge of the 16 procurement of the actual tablet devices. 17 Q So he's not a tech guy? 18 A No. 19 Q So we went through Gary, Kent, Mike 20 Moore, Jeff James, Craig Kopetz and Brian 21 MacPhaiden listed on Exhibit 5. 22 None of those guys are lawyers, right? 23 A No. 24 Q Let me ask you about some other names. 25 I've seen in some of the e-mails a guy named Tom Page 35 1 Blades, B-L-A-D-E-S. Who is he? 2 A I'm not familiar with that name. 3 Q What about Paul Tripp, T-R-I-P-P? 4 What's his role? 5 A Paul is our chief legal counsel. 6 Q Was he in that role when you joined in 7 October of 2015? 8 A Yes. 9 Q To your knowledge, did Mr. Tripp have 10 any involvement in the project other than 11 providing legal advice? 12 A I'm not aware of Paul or legal being 13 involved in this project from the beginning. 14 Q Another name that comes up is somebody 15 named Charles Hartwig, H-A-R-T-W-I-G, or Chas 16 Hartwig. I'm assuming it's Charles. 17 Who is he? 18 A Chas joined I believe in December. 19 Q Of? 20 A Of 2015 as the CIO. 21 Q Chief information officer? 22 A Yes. 23 Q So there's been a lot of turnover in 24 the last 24 months or so in top-level positions, 25 right? Page 36 1 A I wouldn't say a lot, but there has 2 been turnover. 3 Q Just so we've got this straight. When 4 the contract was signed in December of 2014, 5 Gary Wolsiefer is the IT director and he signs 6 the contract? 7 A Correct. 8 Q But Gary leaves in around the middle 9 of 2015? 10 A Yes. I'm not exactly sure when he 11 left. 12 Q When the contract is signed, the COO 13 at the time is Shawn Schabel, but he leaves 14 sometime in 2015? 15 A Correct. 16 Q Before you join in October of that 17 year? 18 A Correct. 19 Q Maybe you told me this and my notes 20 just aren't good enough. When the project 21 started in early 2015, was there a CIO, a chief 22 information officer? 23 A No. 24 Q And what is your title today? 25 A My title is head of application Page 37 1 technology. 2 Q What was it when you started in 3 October of 2015? 4 A Head of application technology. 5 Q Was there anybody that had that title 6 prior to you joining? 7 A No. 8 Q When Gary Wolsiefer left, he had the 9 title of IT director. Did anybody come in and 10 take over that title? 11 A No. 12 Q You took over -- strike that. You 13 came in as head of application technology. Did 14 you in effect take over some or maybe all of 15 what Mr. Wolsiefer had been doing as the IT 16 director? 17 A Some. 18 Q Just so I understand it, and I don't 19 want to waste all day on this. I'm just trying 20 to understand what's going on with the company. 21 Mr. Wolsiefer had been the IT 22 director. He's got obviously some 23 responsibilities, right? 24 A Correct. 25 Q He leaves. What happens to the jobs 10 (Pages 34 - 37) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 11 of 68 Page 38 1 that he would have done? Is that divided over a 2 number of people? Do you assume all of what 3 he's doing and other things? 4 A Some of the responsibilities fell to 5 the manager level. Some of the responsibilities 6 I was overseeing for an interim period. They 7 were actively looking for a CIO when I joined. 8 Q Is that a role that you applied for 9 when you joined? 10 A Yes. 11 Q You were obviously given a different 12 role, head of application technology. Is that 13 at the same level as CIO or is it level below 14 it? 15 A I would say it's a level below it. 16 Q And at some point, a chief information 17 officer is hired after you join the company in 18 October of 2015? 19 A Yes. 20 Q Who is that person and when did they 21 join? 22 A I don't have the exact date. 23 Q It's okay. 24 A I believe it was around December of 25 2015. And the name was Charles Hartwig. Page 39 1 Q So when Hartwig joins in December of 2 2015 as the CIO, he's the first person, at least 3 to your knowledge, to fill that role for 4 Lincare? 5 A Yes. 6 Q We'll come back to other names later 7 as we need. Let's talk a little bit about you. 8 Okay? You told us before that you had been with 9 Rotech prior to joining Lincare. 10 What did you do at Rotech? 11 A I was the chief information officer. 12 Q And what business is Rotech in? 13 A They're in the H&E delivery. 14 Q So the same business as Lincare? 15 A Yes. 16 Q Just so we can have a short way of 17 referring to the kind of software that we're 18 talking about today, what do you refer to that 19 as? Do you have a term that you use? 20 A Are you talking about the Apacheta 21 solutions? 22 Q Yes. That kind of software. Is there 23 a way that you easily refer to it just so we 24 don't get ourselves confused? 25 A It's FSM or Field Service Mobility. Page 40 1 Q How about we call it Mobility 2 Software. 3 A Okay. 4 Q Or if I just call it the software, you 5 know, that kind of software, we'll know what 6 we're talking about? 7 A Yes. 8 Q When you were at Rotech, did you have 9 this Field Service Mobility software in place? 10 A No. 11 Q For what they were doing? 12 A No. 13 Q Had you looked around for that kind of 14 software while you were at Rotech? 15 A Yes. 16 Q Did you consider any particular 17 vendors with that kind of software? 18 A Yes. We considered many vendors. 19 Q Was Apacheta one of them? 20 A Yes. 21 Q So you had some prior contact with 22 Apacheta when you were at Rotech? 23 A Yes. 24 Q When was that? 25 A I want to say -- I don't know the Page 41 1 exact date, but I want to say it was early 2014, 2 maybe late 2013. 3 Q And I should tell you that obviously 4 there's going to be times where you just aren't 5 going to remember a date. That's okay. And if 6 you just can't remember it at all, that's okay 7 too. 8 If you can approximate it, then we'll 9 ask you to do that. Other times we can refer to 10 documents and it will have a particular date. 11 Okay? 12 A Okay. 13 Q So late 2013 or early 2014, you had 14 some involvement with Apacheta in considering 15 them for Rotech? 16 A Yes. 17 Q What transpired them? Was there an 18 actual meeting or was there an exchange of 19 information? Anything like that? 20 A We did an RFP process, request for 21 proposal to many vendors. 22 Q And did Apacheta provide a response? 23 A Yes. 24 Q Was it in writing? 25 A Yes. 11 (Pages 38 - 41) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 12 of 68 Page 42 1 Q Did you ever meet with anybody from 2 Apacheta? 3 A Yes. 4 Q Who did you meet with? 5 A I don't remember all of the names, but 6 the main salesperson was James wee. 7 Q W-E-E? 8 A Yes. 9 Q Where is Rotech out of? Where were 10 you working? 11 A Orlando. 12 Q To your recollection, did Apacheta 13 come down to Orlando and meet with you and give 14 a presentation? 15 A Yes. 16 Q How many times did that happen? 17 A I don't remember the exact number of 18 times, but it was multiple times. 19 Q I guess your recollection is that at 20 least Mr. Wee was involved in that process? 21 A Yes. 22 Q Do you recall anybody else from 23 Apacheta that was involved in that? 24 A No. 25 Q At Rotech, you did not obviously Page 43 1 select Apacheta? 2 A Correct. 3 Q Did you select any other vendor? 4 MR. LIPMAN: Objection. When you say 5 "you," do you mean Rotech or specifically 6 Ms. Reid? 7 MR. STAR: Thank you. 8 BY MR. STAR: 9 Q Thank you. At Rotech did they select 10 any other vendor to go ahead with Mobility 11 Software? 12 A Not by the time I left. 13 Q To your knowledge, and I'm asking you 14 personally, has Rotech since selected a vendor 15 and/or implemented a Mobility solution? 16 A Yes. 17 Q Who did they select? 18 A I have to make sure this is public 19 knowledge, though. I'm not sure if it's public 20 knowledge. 21 Q My understanding I'll tell you is they 22 selected Descartes; is that right? 23 A That's my understanding. 24 Q D-E-S-C-A-R-T-E, I think. 25 A D-E-S-C-A-R-T-E-S. Page 44 1 MR. LIPMAN: D-E-S-C-A-R-T-E-S, like 2 the philosopher. 3 BY MR. STAR: 4 Q Since the time you joined Lincare in 5 October of 2015, have you had any contact with 6 James Wee? 7 A He called me. 8 Q When was that? 9 A I don't remember the exact time. It 10 was either at the very end of my tenure at 11 Rotech or right after I left. 12 Q What did he call you in connection 13 with? 14 A He told me that he was with Descartes 15 and that this is a much better solution that we 16 should look at. 17 Q Did Mr. Wee send you any materials? 18 Did he send you a letter? Did he send you an 19 e-mail? 20 A It was a phone call. 21 Q Was it one phone call or multiple 22 phone calls? 23 A One phone call. 24 Q And what did you do, if anything, in 25 reaction to his phone call? Page 45 1 A Nothing. 2 Q We're going to get into this later, 3 but obviously there's a series of different 4 e-mails and discussions that you and others at 5 Lincare are having in the fall of 2015 about 6 other vendors. 7 Is Descartes one of the other vendors 8 that you considered? 9 A No. 10 Q Why not? 11 A They had some what we would call core 12 requirements that they could not meet. There 13 were some initial analysis done on the vendors, 14 and they didn't even meet some of the basics 15 that we were looking for. 16 Q So let's talk about you more. So you 17 were the CIO at Rotech. Let's go back to your 18 educational background. I don't need to know 19 where you went to high school. 20 You have college education? 21 A Yes. 22 Q Where did you go to college? 23 A Almeda University. 24 Q Where is that? 25 A It's an online college. 12 (Pages 42 - 45) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 13 of 68 Page 46 1 Q When did you graduate? 2 A In 2008. 3 Q And what's your degree? 4 A I have a Master's in computer science. 5 Q Help me to understand. Did you get a 6 Bachelor's Degree first? 7 A Yes. 8 Q And how long was the program? 9 A It was about a year and a half. So 10 they took my -- I took a lot of courses through 11 IBM in my early career through Travelers 12 Insurance and they converted all of those 13 college-level courses into not quite a 14 Bachelor's Degree, but close. I had to do some 15 more work and then work towards the Masters. 16 Q Let's just step back and get a general 17 overview of your history in the IT field. 18 A Sure. 19 Q If saying the IT field is not good 20 enough, you tell me. When did you start working 21 in the IT field? 22 A You're really going to make me age 23 myself. In the early '80s. 24 Q Doing what? 25 A I started out as a system operator in Page 47 1 the late '70s, early '80s for -- you want me to 2 go through each of my companies? 3 Q Yes. 4 A St. Philip Towing & Transportation 5 here in Tampa. I went on to Invest Financial as 6 their IT systems manager. 7 Q Just the approximate year. 8 A I want to say that was '83 to '87. 9 And then Travelers Insurance, Managed Care 10 Division, as the director of IT business 11 applications I think was my title. That was '87 12 to '93. And then Pharmerica, 13 P-H-A-R-M-E-R-I-C-A, for ten years, senior 14 director of IT, and then Advantech, CIO, for 15 five years and then Rotech as CIO for seven and 16 a half years. 17 Q And when you joined Rotech, were you 18 the CIO right away? 19 A Yes. 20 Q We already talked about whether Rotech 21 had a Mobility solution. You were considering 22 it at the time you left, but none had been 23 selected. 24 I take it, just because the technology 25 didn't even exist more than seven or eight years Page 48 1 ago, I'm sure, that at none of your prior 2 employers there was any consideration of a 3 Mobility solution? 4 A Yes, there was. There was Advantech. 5 Q Okay. Tell me about that. 6 A So the sales reps that -- Advantech 7 was an HR, payroll, benefit outsourcing company. 8 So we had thousands of clients that we did their 9 HR and payroll. 10 So our account reps, account managers 11 would go to the client sites and then we 12 deployed a Mobility solution for that. And even 13 though back in Pharmerica days, I left in 2003, 14 we deployed a Mobility to all of our pharmacy 15 operations. 16 Q I guess, I'm forgetting the dates on 17 when this kind of stuff was available. 18 A Yes. It's been around longer than you 19 think. PDAs have been here for quite a while. 20 Q Let's get into a little bit more of 21 the project itself. I should mention, obviously 22 this isn't a marathon. If you need a break, 23 just let me know. The only rule is if I've got 24 a question pending, we'll try to get through 25 that. Page 49 1 So I know you were not there at 2 Lincare at the time when the contract was signed 3 or when negotiations took place. You tell me if 4 this is the subject that you're not able to 5 testify about. 6 I'd like to go through some of the 7 initial proposals very quickly. That may be 8 hard for you, but just let me know. Okay? 9 Let me ask you this, have you gone 10 back to educate yourself at all about what was 11 initially proposed and what negotiations took 12 place, if any, in connection with signing the 13 contract in December of 2014? 14 A I have gone back and looked at the 15 original statement of work if that's what you're 16 asking. 17 Q When you say the original statement of 18 work, do you mean the one that's attached to the 19 contract that we already went through? 20 A Yes. 21 Q Let's try this and then you tell me if 22 this is not something you can testify about. 23 MR. STAR: This will be Exhibit 6. 24 (Exhibit 6 marked for identification.) 25 BY MR. STAR: 13 (Pages 46 - 49) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 14 of 68 Page 50 1 Q So what we've marked as Exhibit 6 2 starts with an e-mail chain between Gary 3 Wolsiefer and James Wee on October 17th of 2014. 4 The subject is Apacheta Project 5 Overview and Pricing Guide and there is an 6 attachment called Lincare Project Overview. 7 Is this a document you're familiar 8 with? I'm not going to ask you detailed 9 questions about it. 10 A I've seen so many documents. 11 Q My question is going to simply be 12 this. From the documents that have been 13 produced by both sides in the case, from what we 14 can tell, this seems to be the earliest exchange 15 of an initial proposal that leads up to the 16 contract. 17 Would that be your understanding too? 18 A I don't -- I can't say whether there 19 were other documents, but I would say that seems 20 reasonable. 21 Q We can at least agree that on 22 October 17th of 2014l, this project overview 23 document was shared by James Wee at Apacheta 24 with Gary Wolsiefer at Lincare? 25 A Yes. Page 51 1 Q You can put that to the side. 2 MR. STAR: This is going to be 3 Exhibit 7. 4 (Exhibit 7 marked for identification.) 5 BY MR. STAR: 6 Q Exhibit 7 is another Lincare produced 7 document. It's Lincare 328. It's a one-page 8 e-mail chain with two e-mails, November 5th and 9 November 7th of 2014. 10 And you see at the top, which is the 11 last e-mail in the chain, it's an e-mail from 12 Gary Wolsiefer to James Wee? 13 A Yes. 14 Q Gary writes, "James, I've put together 15 the cost for Shawn." That would have been Shawn 16 who was the COO at the time? 17 A Yes. 18 Q Shawn Schabel just so we've got that. 19 So Gary says, "I put together the cost for Shawn 20 and sent it to him for his review. His take is 21 that we need to be at more like $750,000 per 22 year for licensing to make this work." 23 Do you see that? 24 A Yes. 25 Q And the reference to $750,000 per year Page 52 1 for licensing is ultimately the reference that 2 we'll find later on in the actual contract to 3 the annual software licensing fee of $750,000, 4 correct? 5 A Yes. 6 Q So we can see here that there was at 7 least some level of negotiation between Lincare 8 on the one hand and Apacheta on the other as to 9 the software licensing price, correct? 10 A Yes. 11 Q You can put that one away. 12 (Exhibit 8 marked for identification.) 13 BY MR. STAR: 14 Q So we've marked here as Exhibit 8, 15 documents that are Bates labeled Lincare 460 16 through 493. The first couple of pages are an 17 e-mail and then there's an attachment to the 18 e-mail, the e-mail chain I should say. 19 Is this an e-mail that you reviewed 20 before you came here today? 21 MR. LIPMAN: Give her a moment to 22 review it. The writing is so small. 23 MR. STAR: It's not my doing. 24 A I have not seen this e-mail. 25 BY MR. STAR: Page 53 1 Q I'm interested, though, in just 2 whether we can agree on a couple of things. The 3 top e-mail, which is the last one in the chain 4 is from James Wee at Apacheta to Gary Wolsiefer 5 on December 9, 2014. 6 And James writes back to Gary. And in 7 the second line he says, "All and all, our level 8 counsel accepted most of the changes you have 9 made with a few remaining legal items in section 10 5.2, 7.2 and 7.3." 11 Do you see that? 12 A Yes. 13 Q And if we flip to the attachment and 14 we go to section 5.2 of the attached agreement, 15 which you would find on the document in the 16 bottom right-hand corner labeled Lincare 464. 17 A Okay. 18 Q Section 5.2 of the contract or at this 19 point it's a draft contract is titled 20 termination on breach. 21 Do you see that? 22 A Yes. 23 Q So we can agree that based on this 24 e-mail chain between Mr. Wee and Mr. Wolsiefer, 25 there was at least some level of discussion 14 (Pages 50 - 53) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 15 of 68 Page 54 1 between the parties prior to signing the 2 contract as to section 5.2 regarding termination 3 on breach? 4 A The e-mail does not say that they 5 agree at this point. 6 Q That's not my question. My question 7 is simply, and I'm not trying to trick you, I 8 think it's something we can pretty easily agree 9 on, that based on Mr. Wee's e-mail, there was at 10 least some level of discussion about section 5.2 11 which refers to termination on breach? 12 A I'm sorry, what was your question? 13 Q Do you see in Mr. Wee's e-mail, he 14 writes back to Mr. Wolsiefer and he makes 15 specific reference to section 5.2 of the 16 contract. Go back to the e-mail. 17 A Okay. 18 Q When we go to section 5.2, at this 19 point it's a draft contract, we see that 5.2 is 20 titled termination on breach, right? 21 A Yes. 22 Q So we can agree, of course, that there 23 was at least some level of discussion prior to 24 the contract itself being signed in December of 25 2014. There was at least some level of Page 55 1 discussion about the provision 5.2 regarding 2 termination on breach. 3 A Yes. I agree, there was conversations 4 around that. 5 Q We can put that one away. Let's go 6 back please to the actual executed contract 7 which we marked as Exhibit 2. 8 And just so you don't get confused 9 with all of the paper, feel free to put it 10 anywhere to the side. 11 You can leave the contract out because 12 we're going to keep coming back to it. I want 13 to make sure we're on the actual executed 14 contract, which is Exhibit 2. So we'll talk in 15 general about Lincare's understanding and views 16 of this contract. Okay? 17 A Uh-huh. 18 Q Yes? 19 A Yes. 20 Q And that's something you feel you're 21 able to testify about today? 22 A Yes. 23 Q It's one of the topics in our 24 deposition notice? 25 A Yes. Page 56 1 Q So as we already established, the 2 agreement itself, at least as originally signed, 3 is 16 pages long? 4 A Yes. 5 Q It has at the beginning the software 6 license and services agreement? 7 A Correct. 8 Q And then it has Exhibits A, B and C, 9 right? 10 A Yes. 11 Q So let's stay a little bit with the 12 beginning part of this contract and go to page 13 3. We see there at section 4.1, the heading is 14 statement of work. 15 Do you see that? 16 A Yes. 17 Q It says, "Apacheta and customer." 18 That's, of course, Lincare is the customer? 19 Yes? 20 A Yes. 21 Q "Apacheta and Lincare may enter into 22 one or more SOWs." That's, of course, statement 23 of work? 24 A Yes. 25 Q In fact, when this contract is signed Page 57 1 on December 16th of 2014, a statement of work is 2 entered into and that's attached as Exhibit C, 3 correct? 4 A Yes. 5 Q And we see it was signed by Mr. 6 Wolsiefer? 7 A Correct. 8 Q This section 4.1 at page 3 goes on to 9 say, "Each SOW will set forth, as applicable, 10 the specific locations, activities and tasks to 11 be performed by the parties, deliverables, if 12 any, and the fees and payment schedule." 13 Do you see that? 14 A Yes. 15 Q Section 4.2 discusses change of scope? 16 A Yes. 17 Q And it reads, "Any change of scope 18 will be identified and mutually agreed upon in 19 writing by the parties. And they term that "a 20 project change request." 21 Do you see that? 22 A Yes. 23 Q "Upon execution of a project change 24 request by both parties, such project change 25 request shall be become a constituent part of 15 (Pages 54 - 57) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 16 of 68 Page 58 1 the applicable SOW." 2 A Yes. 3 Q So there was actually a procedure in 4 place, we can agree, for a formal written change 5 request that would then become a part of the 6 statement of work, right? 7 A Correct. 8 Q Just so we're clear again, to your 9 knowledge, there was no such written change 10 request that then became a part of the statement 11 of work? 12 MR. LIPMAN: Objection, but you can 13 answer. 14 A You know, as far as working through 15 the project, the requirements phase is first. 16 Then you have to have a statement of work that 17 says what the deliverables are, what the 18 acceptance criteria is and the dates. 19 So during that requirement phase, 20 there was many changes being made to the SOW, 21 but at the final stage, that's when you have to 22 have an acceptance. 23 That's what it's talking about. You 24 get into a formal change request once you've 25 signed off on the acceptance criteria. Page 59 1 Q Let's just make sure we're clear 2 because I'm not trying to trick you or split 3 hairs. There was no formal change request, 4 correct? I've not seen one. Have you? 5 A I've seen many changes. So the 6 changes were in the e-mails, before the project 7 manager accepted them, the specifications were 8 changed because of them. 9 Q I understand your -- just so we've got 10 this. I understand your point to be, and we're 11 going to go through in a moment how the project 12 was to happen through the inception phase, et 13 cetera. 14 Your point right now is during the 15 inception phase, there is a process to gather 16 Lincare's requirements to figure out what 17 exactly Lincare wants to be built and deployed, 18 correct? 19 A Correct. 20 Q And ultimately, the process of 21 gathering off of those requirements and working 22 collaboratively between Apacheta on the one hand 23 and Lincare on the other is going to be 24 manifested in a document that's going to lay out 25 or a series of documents that are going to lay Page 60 1 out exactly what's going to be built, correct? 2 A Correct. 3 Q And the way that that's laid out is, 4 at least in this project through what would be 5 called a functional specification, correct? 6 A Correct. 7 Q I think your point, and you tell me if 8 I'm wrong, is that during the process of 9 gathering requirements and figuring out what was 10 going to be going into those functional 11 specifications, that grows and changes and then 12 is ultimately written down in that document? 13 A Correct. 14 Q But that is not in and of itself a 15 formal change request, correct? 16 A When you're doing functional 17 requirements, that is not part of the change 18 request process. It's a fluid document just 19 like you explained. And until we come to an 20 agreement that our requirements are being met, 21 then you're not at the point of acceptance. 22 Q And just so we understand it, though, 23 a change request in this industry is going to be 24 for something that is considered out of the 25 scope of the way the initial project is defined, Page 61 1 right? 2 A Well, you have to define the scope. 3 So the requirements phase is about defining the 4 scope at a detailed level. 5 The contract is very high-level. It's 6 just a few words. So you're not really at a 7 scope until you have defined all of the 8 requirements. 9 Q For whatever reason, maybe we're 10 missing each other here or maybe there's 11 something more to it that you have in mind. I'm 12 not trying to trick you. 13 Again, when the answer was given to 14 the complaint, one of the reasons given for 15 denying, for example, that the contract was the 16 contract was that Lincare wasn't aware at the 17 time if there were modifications or changes to 18 the contract. And I'm trying to find out what 19 you know about specifically change requests. 20 Okay? 21 Alex and I have been through all of 22 the documents in the case, both that are client 23 has and have been produced and the documents 24 that you guys have produced. 25 Will you agree with me that you've 16 (Pages 58 - 61) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 17 of 68 Page 62 1 never seen an actual formal change request, the 2 kind that's being mentioned as a quote, unquote, 3 project change request in section 4.2 at page 3 4 of the contract? 5 A I have not seen Apacheta produce a 6 format of what a change request is supposed to 7 like at. So how can I say whether I've seen one 8 or not? 9 Q So the answer is no, you have not seen 10 an actual signed change request, have you? 11 A I can't say I haven't seen one if I 12 don't know what the format is supposed to look 13 like. I've seen many changes. 14 Q And you've said that. We're talking 15 here -- you can agree with me that this 16 contract, it's pretty easy to understand section 17 4.2, right? 18 A Uh-huh. 19 Q Yes? 20 A Yes. 21 Q It's titled change of scope, right? 22 A Yes. 23 Q And it says, "Any change of scope will 24 be identified and mutually agreed upon in 25 writing by the parties." And that's going to be Page 63 1 quote, unquote, project change request? Yes? 2 A Yes. 3 Q And you've never seen a quote, 4 unquote, project change request? There is none 5 for this project? 6 A I have not seen a document format that 7 says it's a change request form. 8 Q Thank you. Let's go to the statement 9 of work. We'll be coming back to this contract 10 quite a lot. 11 The statement of work itself that was 12 signed and is Exhibit C to the contract is again 13 pages 13 through 17, right? 14 If you look at the bottom, I'm looking 15 at the beginning of page 13 that's Exhibit C 16 titled statement of work, December 15, 2014. 17 A Okay. 18 Q The first part is titled section 1, 19 scope of work, right? 20 A Yes. 21 Q Tell me what your understanding is of 22 the purpose and the meaning of section 1? And 23 when I say you, I mean Lincare, what Lincare's 24 understanding is of section 1, scope of work of 25 the statement of work. Page 64 1 MR. LIPMAN: Objection, but you can 2 answer. 3 A I'm sorry? 4 MR. LIPMAN: I objected to the 5 question, but you can provide a response. 6 A The understanding of the scope of work 7 is the high-level modules, that we're going to 8 look at functionality and get to the detail of 9 the functionality needed in each of these 10 modules. 11 BY MR. STAR: 12 Q Now, you mentioned earlier and we had 13 a little discussion about it, that during the 14 project itself, the actual scope of what will be 15 ultimately developed and delivered is developed 16 or built out through work between the teams, 17 right, the two parties? 18 A Right. 19 Q And that's going to happen if we go to 20 section 2 titled deliverables, we see there's a 21 number of difference project phases. And the 22 first one at 2.1 is project inception phase, 23 correct? 24 A Yes. 25 Q So it's during this project inception Page 65 1 phase that, among other things, the parties are 2 going to work together to gather Lincare's 3 requirements, figure out what Lincare wants in 4 the Mobility solution that Apacheta is going to 5 deliver and they're then going to document that 6 and agree to have Apacheta go ahead and deliver 7 that, correct? 8 A They're going to -- at the end of 9 inception phase, they're going to accept that 10 they can do it or not. 11 Q Who is going to accept if they can do 12 it or not? 13 A Lincare. So they can either meet the 14 requirements as set forth in the acceptance 15 criteria or not. 16 Q Well, let's talk about that. First 17 off, section 2 is deliverables. It says, 18 "Apacheta shall furnish the customer the 19 deliverables listed below as may be further 20 described in this statement of work defined as 21 the deliverables," right? 22 A Correct. 23 Q And if we flip back to page 3 of the 24 contract, this is within the initial part of the 25 software license and services agreement, page 3 17 (Pages 62 - 65) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 18 of 68 Page 66 1 at section 4.3 is titled acceptance of 2 deliverables, right? 3 A Yes. 4 Q You're familiar with that language? 5 A Yes. 6 Q This is pretty clear? 7 A Yes. 8 Q "Each statement of work will describe, 9 if applicable, the deliverables that Apacheta is 10 obligated to furnish to Lincare hereunder 11 collectively, the deliverables, and the 12 acceptance criteria for each of the 13 deliverables, if applicable, called the 14 acceptance criteria." 15 Do you see that? 16 A Yes. 17 Q "Unless set forth otherwise in a 18 statement of work, each deliverable shall be 19 deemed accepted 15 days after delivery by 20 Apacheta to customer." They call that the 21 acceptance date. 22 Do you see that? 23 A Yes. 24 Q And that's pretty easy to understand. 25 You would agree that if Lincare received the Page 67 1 deliverable and didn't reject that deliverable 2 within 15 after receipt, it would be deemed 3 accepted, right? 4 A Yes. I don't agree with contracts 5 being written this way, but I understand that 6 this was written this way. 7 Q Thank you. So let's go back to page 8 14 under 2.1, project inception phase. If you 9 want to take a quick break right now, why don't 10 we do that. 11 A Yeah, let's do that. 12 (Recess taken) 13 BY MR. STAR: 14 Q Before we go further, Alex reminded 15 me, I forgot to ask about one other role in the 16 company. 17 When the contract was signed in 18 December of 2014, who was the CEO of Lincare? 19 A I'm sorry, what date? 20 Q December of 2014. 21 A Tom Byrnes. 22 Q To your knowledge, did Mr. Byrnes have 23 any involvement in proving approving the 24 contract or any role whatsoever with regard to 25 the project? Page 68 1 A I believe he was not involved. 2 Q Do you know when Mr. Byrnes left 3 Lincare? 4 A I don't know the exact date. 5 Q When you joined in October of 2015, 6 who was the CEO? 7 A Kristen Hoefer. 8 Q Could you spell that for Mary Ann? 9 A Kristen is K-R-I-S-T-E-N and Hoefer is 10 H-O-E-F-E-R. 11 Q And do you know when Ms. Hoefer joined 12 as the CEO of Lincare? 13 A I believe it was in the March, April 14 time frame of 2015. 15 Q Let's go back to talking about the 16 project itself. We're on page 14 of the 17 contract, which is Exhibit 2. 18 Let's talk about the phases at a 19 high-level first. 2.1 says project inception 20 phase, right? 21 A Yes. 22 Q And 2.2 is configuration and 23 development phase? 24 A Yes. 25 Q 2.3 is acceptance test phase? Page 69 1 A Yes. 2 Q And 2.4 is rollout support? 3 A Yes. 4 Q In this industry, in effect, once 5 you've gotten through rollout support, that 6 means that the software itself is rolled out, 7 put into use and is actually in production for 8 the customer, right? 9 A Correct. 10 Q And that basically is the end of the 11 project so far as services go from the 12 provider's perspective, right, except with 13 regard to ongoing maintenance? 14 A Yes. Except with regard to I would 15 say additional phases and ongoing maintenance. 16 Q Additional phases, if those are part 17 of a project? 18 A Right. 19 Q But the way this project was spelled 20 out in this statement of work through sections 21 2.1 through 2.4, it was going to start with 22 project inception and go all the way up to 23 rollout support. And then there would be 24 ongoing maintenance for the software every year 25 and support for the software, correct? 18 (Pages 66 - 69) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 19 of 68 Page 70 1 A If there was final SOW acceptance. 2 Q Understood. So let's talk more about 3 the projection inception phase. There's six 4 listed tasks within this phase. First is a 5 kickoff meeting. Do you see that? 6 A Yes. 7 Q You're aware that a kickoff meeting 8 actually happened in January 2015? 9 A Yes. 10 Q Let's get the document on the record 11 real quick. 12 MR. STAR: This is Exhibit 9. 13 (Exhibit 9 marked for identification.) 14 BY MR. STAR: 15 Q Exhibit 9 is an e-mail dated January 16 8, 2015 from James Wee to Gary Wolsiefer. The 17 subject is project kickoff meeting agenda and 18 attached is a kickoff agenda. 19 James writes, "Gary, enclosed is the 20 draft agenda for next week's meeting." And if 21 you flip to the next page, which is Bates 22 labeled Lincare 692, we see the heading is 23 project kickoff meeting. 24 It says January 14th. Actually, it 25 says January of 2014, but that would have been Page 71 1 2015, correct? 2 A Yes. 3 Q And you're that the kickoff meeting 4 actually did occur on January 14, 2015? 5 A Yes. 6 Q We can put that one away. Well, let's 7 stick with Exhibit 9 for a moment. If we go to 8 the agenda for the project kickoff meeting, 9 which is Lincare 692 through Lincare 694. If 10 you go to the second page, item 9, it says 11 high-level project plan. One of the items is 12 gap analysis complete. 13 Do you see that? 14 A Yes. 15 Q Tell us what a gap analysis is. 16 A A gap analysis is comparing Lincare's 17 requirements to what the application can provide 18 in finding the gaps. 19 Q And then any gaps would then be 20 identified in the functional specification and 21 then there would either be a solution for 22 filling that gap or there would be some other 23 way to accommodate that? Is that how that would 24 generally go? 25 A Generally, there would be three points Page 72 1 of it. It would be identifying the gap, 2 identifying whether or not the vendor has the 3 capability and then third would be whether or 4 not the vendor has the ability to achieve that. 5 Q And another possible solution is that 6 when gaps are identified, the customer can 7 decide to take a different solution and do 8 things in a different way so there is no gap, 9 correct? 10 A It should not be the customer's 11 responsibility. 12 Q But that a possibility? 13 A It's a possibility, but you have a 14 turnkey system that you are looking at so that 15 it meets the business requirements so that the 16 company Lincare doesn't have to take on the 17 responsibility of the gap. 18 (Exhibit 10 marked for 19 identification.) 20 BY MR. STAR: 21 Q Let's go to the next exhibit that 22 we've marked as 10. I don't know. Is this a 23 document that you're familiar with? Have you 24 seen this e-mail before? 25 A Yes. Page 73 1 Q It's something you have reviewed in 2 preparation for today? 3 A Well, let me look at each page. So 4 I've seen the e-mail, but I've not seen what 5 looks like a blank format of a test script. 6 Q Let's just stick with the e-mail then. 7 This is from Cora Forgeng. She's with Apacheta, 8 correct? 9 A Yes. 10 Q And she sends it to Gary Wolsiefer and 11 all of the other folks that were listed as being 12 part of the Lincare project team in that 13 document we looked at earlier, right? 14 A Yes. 15 Q It's dated January 22, 2015. The 16 subject is kickoff action items follow-up. Do 17 you see that? 18 A Yes. 19 Q And she attaches a number of 20 documents, some in PDF format and some in zip 21 files. She writes, "Good afternoon. Following 22 up on some of the action items. Please see the 23 shaded items below," right? 24 Do you see she writes that? 25 A Yes. 19 (Pages 70 - 73) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 20 of 68 Page 74 1 Q Look at item 5. The action item from 2 Apacheta is, "Send acceptance plan examples." 3 Do you see that? 4 A Yes. 5 Q And 5A says, "See attached zip file." 6 A Yes. 7 Q Do you see that? 8 A Yes. 9 Q So you would agree with me that on 10 January 2, 2015, the week after the actual 11 initial kickoff meeting, Apacheta forwarded 12 acceptance plan examples to Lincare? 13 A Yes. 14 Q Have you ever personally reviewed the 15 acceptance plan examples that were attached to 16 Ms. Forgeng's January 22, 2015 e-mail? 17 A Is this what this second page is? 18 Q I don't know that I can answer your 19 question because there were a number of 20 attachments. 21 You can see as well as that the second 22 page is test script, and that's also one of the 23 attachments. So it may be that our example -- 24 what we've marked as Exhibit 10 is not fully 25 completed and does not actually attach all of Page 75 1 the files. 2 My question, though, is, whether 3 regardless of whether the documents attached as 4 part of Exhibit 10 constitute the example 5 acceptance plans. My question is, have you ever 6 personally reviewed any sample acceptance plan 7 that was sent by Ms. Forgeng on January 22, 8 2015? 9 A I can't say. Since we can't verify 10 that these attachments are what was attached at 11 the time, it's hard for me to answer that. 12 MR. LIPMAN: Off the record for a 13 second. 14 (Discussion off the record.) 15 A These don't look like samples. 16 BY MR. STAR: 17 Q To your recollection, you personally, 18 when you came on board at Lincare in October of 19 2015, did you review any acceptance plan or 20 acceptance criteria for this particular project? 21 A Yes. 22 Q That was in October of 2015? 23 A No. That was November 20th when it 24 was sent to us. 25 Q So the first time you ever looked at Page 76 1 any acceptance criteria was November 20th of 2 2015? 3 A That's when it was sent to us for the 4 first time, November 20th. 5 Q And up until that time, November 20th 6 of 2015, we can agree that Lincare itself did 7 nothing to actually develop acceptance criteria, 8 correct? 9 A You have to get past the specification 10 phase. So you can't accept anything until you 11 know what your requirements are. 12 Q My question is different. 13 A Okay. 14 Q I'm not trying to argue anything with 15 you. It's just a factual point. We can agree 16 that prior to November 20th of 2015, nothing was 17 done by Lincare itself to ever develop any 18 acceptance criteria for this project, correct? 19 A Correct. 20 Q That's it for Exhibit 10. Let's go 21 back to the contract, Exhibit 2, page 14, 22 section 2.1, project inception phase. 23 So the first item is kickoff meeting. 24 We've actually that the kickoff meeting was 25 actually done and that piece of the inception Page 77 1 phase was completed, correct? 2 A Yes. 3 Q Next is item B, "Review of application 4 functionality and integration." That we can 5 agree was part of the project that would be done 6 as part of the requirements gathered and it 7 would ultimately be something that would be 8 documented in the final functional 9 specification? 10 A I would say that's part of it. 11 There's more than a functional specification 12 that you're going to need before you can accept. 13 So functional specifications are the 14 application, but there's hardware, there's 15 software, there's the tablets. 16 I've not seen a complete project plan 17 from Apacheta that encompasses what all was 18 needed to make this work. 19 Q So I take it in your view, this item 20 2.1(b), review of application functionality and 21 integration, do you believe that was done or 22 not? 23 A I believe parts of it were started, 24 but not all of the parts were done. 25 Q Just help me to understand. When you 20 (Pages 74 - 77) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 21 of 68 Page 78 1 say parts of it were started and some of it ws 2 done, where we would find the completed piece of 3 2.1(b)? 4 A The functional specifications, there 5 were different versions of them, but as far as 6 hardware and software and tablets, there was not 7 a specification produced by Apacheta. We 8 couldn't get past the inability of certain 9 functional issues with Apacheta. 10 Q So you would have expected, as I 11 understand your testimony, the final 12 specifications to include specifications on 13 hardware, software and tablets? 14 A Well, it's part of hardware. 15 Q So tablets and hardware is the same 16 thing? 17 A Right. So say hardware, integration, 18 systems and functional capabilities. 19 Q And you believe those items are what 20 would be required in the final functional 21 specifications? 22 A Correct. 23 Q Just so we're clear, the way your 24 understanding, Lincare's understanding of the 25 project is that the manifestation of this Page 79 1 project inception phase was going to be the 2 final functional specifications, which would be 3 the final SOW that would then be used to develop 4 the project, right? 5 A It would be the final statement of 6 work with acceptance criteria and delivery 7 dates. 8 Q Okay. You're telling me that within 9 those functional specifications, you would 10 expect certain things to be write down? 11 A Yes. 12 Q And you've told me that would include 13 the functionality, the system, integration, the 14 hardware, which is the tablets and then 15 information about the software? 16 A Hardware being tablets and servers. 17 So any kind of hardware that's required for this 18 to operate. 19 Q So those are the elements that you 20 would expect to be generally speaking -- 21 A Generally speaking, yes. 22 Q You would have those general elements 23 with detail on each of them within the final 24 specifications? 25 A Correct. Page 80 1 Q 2.1(c), "Finalize any custom 2 development requirements." That's sort of the 3 same thing, right, that the custom development 4 requirements would be gathered during the 5 project inception phase and then they would be 6 documented in the functional specification, 7 right? 8 A Correct. 9 Q From Lincare's perspective, were its 10 customer development requirements captured and 11 documented in the functional specifications? 12 A I'm sorry? 13 Q From Lincare's perspective, were its 14 custom development requirements for this project 15 actually captured and documented in functional 16 specifications? 17 A It was not complete. 18 Q 2.1(d), "Acceptance criteria (as 19 further described below)." And then if we go 20 down to 2.3 -- do you see that in 2.1(d), 21 "Acceptance criteria, as further defined below?" 22 A Yes. 23 Q Okay. If we go down to 2.3 on page 24 14, specifically 2.3(b), we see, "Acceptance 25 testing (per acceptance criteria defined Page 81 1 below)." And then below that we see the 2 heading, "Acceptance requirements." 3 Do you see that? 4 A Yes. 5 Q I think we can agree that the 6 acceptance criteria themselves are going to be 7 developed and written out during the inception 8 phase, but the acceptance criteria are then used 9 as part of the testing, the acceptance test 10 phase in section 2.3; is that right? 11 A The acceptance requirements section is 12 referred to in 2.1, which is project inception 13 phase, not in 2.3, which is acceptance test 14 phase. 15 Q I'm sorry, I'm not following you. 16 What do you mean? What do you mean? 17 A So it's referred to -- 18 Q When you say "it", what is referred -- 19 A The acceptance requirement, which is 20 referred to in 2.1 which is part of the 21 inception phase. 22 Q Show me in 2.1 where the words 23 acceptance requirements are? 24 A D, "Acceptance criteria as further 25 described below." 21 (Pages 78 - 81) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 22 of 68 Page 82 1 Q Okay. So that's acceptance criteria, 2 but the phrase acceptance requirements appears 3 under 2.3(b), correct? 4 A No. 5 Q I'm not trying to trick you. You 6 don't see the words acceptance requirements in 7 2.1? It's only under 2.3(b). I think what 8 you're saying is acceptance criteria is referred 9 to in 2.1(d) and then again in 2.3? 10 A Correct. 11 Q My question to you is simple. The 12 acceptance criteria themselves are put together 13 during the inception phase, but the criteria are 14 not then actually used until you go through 15 testing? That's what the criteria are for, 16 right, to measure the testing of the actual 17 built solution? 18 A It's two-fold. 19 Q Explain. 20 A So the acceptance criteria defines the 21 deliverables that are mutually agreed upon 22 before you start the next phase, which is the 23 actual development phase. 24 And, yes, at a later date, if you 25 agree to the next phase, you will use that in Page 83 1 your test plan. 2 Q Go back with me to page 3 of the 3 contract, 4.3. We read this earlier. It's 4 titled acceptance of deliverables. "Each SOW 5 will describe, if applicable, the deliverables 6 that Apacheta is obligated to furnish to 7 customers hereunder, collectively, the 8 deliverables, and the acceptance criteria for 9 each of the deliverables, if applicable," called 10 the acceptance criteria, right? 11 A Are you on 4.3? 12 Q I'm on 4.3 on page 3. 13 MR. LIPMAN: You're asking her if you 14 read that correctly? 15 MR. STAR: Yes. 16 MR. LIPMAN: It says what it says. 17 You can read it. 18 A What's the question? 19 BY MR. STAR: 20 Q Well, first off, you agree that it 21 says what I just read, right? It says, "Each 22 SOW will describe, if applicable, the 23 deliverables that Apacheta is obligated to 24 furnish to Lincare, the customer hereunder, 25 collectively, the deliverables, and the Page 84 1 acceptance criteria for each of the 2 deliverables, if applicable, called the 3 acceptance criteria." 4 Do you see that? 5 A Yes. 6 Q And if we go back to -- if we go back 7 to section 2, page 14, in 2.1, the project 8 inception phase, one of the things that is going 9 to happen is the development of the acceptance 10 criteria, correct? 11 A Yes. 12 Q I just want to understand Lincare's 13 point of view here. You've told me that you I 14 think you agree at least in part, and I don't 15 want to put words in your mouth and you tell me 16 if I've got this wrong, you agree that at least 17 in part, the acceptance criteria that will be 18 developed during the project inception phase are 19 going to be used during the acceptance test 20 phase to actually test the developed software to 21 make sure it does the things it's supposed to 22 do, correct? 23 A That is one of the uses. 24 Q What in your view and Lincare's view 25 is another use? Page 85 1 A Defining the deliverables and 2 deliverable dates and responsibilities. 3 Q I'm having a tough time understanding. 4 Let me try this a different way. You're aware 5 that final functional specifications were 6 provided to Lincare in October of 2015, correct? 7 A Final specifications were not 8 delivered to Lincare on 10/5, because it did not 9 include the entire project. 10 Q From your point of view, you don't 11 want to concede to anything. I get it. 12 Functional specifications were delivered, we can 13 agree, on October 5, 2015, right? 14 A We can agree that partial functional 15 requirements were delivered on October 5th. 16 Q Well, I won't agree it was partial. 17 We agree that a set of documents from Apacheta, 18 which they call functional specifications, was 19 delivered on October 5, 2015, right? 20 A There was a document that was called a 21 functional spec delivered on 10/5. 22 Q Three documents, right? 23 A Correct. 24 Q Three functional specs? Yes? 25 A Yes. 22 (Pages 82 - 85) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 23 of 68 Page 86 1 Q And we've established, that in your 2 view, Lincare's view, it would be three 3 functional specifications like that. And I get 4 that you want to contend that those aren't final 5 and we'll get to that, but it would be three 6 documents like those that you would get to the 7 final statement of work and there would be, if 8 you agreed, final SOW acceptance, correct? 9 A It would be through many documents 10 like that. 11 Q My question to you is simply this. Is 12 it Lincare's position that in order to review 13 and approve and accept any document like those 14 functional specifications, which would be the 15 final SOW, that it needed acceptance criteria? 16 A It needed deliverables, it needed a 17 project plan and it needed dates and 18 responsibilities. 19 Q Just so we're -- 20 A Which is the statement of work. 21 Q But I think you're telling me that the 22 acceptance criteria itself does not measure the 23 acceptance of the functional specifications, 24 right? 25 A Correct. Page 87 1 Q So the functional specifications are 2 they either meet what you're expecting them to 3 meet or they don't just based on the words 4 within them, correct? 5 A Correct. 6 Q So Lincare is able to and in fact, 7 that's what they planned, Lincare is able to 8 review and either reject or approve the final 9 functional specifications, the final SOW just 10 based on those documents themselves, without 11 having acceptance criteria in place, because the 12 acceptance criteria doesn't measure whether the 13 functional specifications are acceptable. 14 That's just what you told me, right? 15 A No. You cannot agree on a functional 16 spec. It's a fluid document. You have to agree 17 on a statement of work with deliverables and 18 what's in this phase and who is going to do what 19 and what are the dates. 20 So a functional spec are charges we're 21 going to make to a screen. It's so -- that's 22 why it says, "The final SOW acceptance with 23 acceptance criteria in a project plan. 24 Q Where does it say those words that you 25 just read? That's not what it says. Page 88 1 A Project inception phase, D, E and F, 2 acceptance criteria, project plan and final SOW 3 acceptance. 4 Q Right. Now, we've established, and 5 you've me this multiple times today, that the 6 final SOW was expected to be manifested in a 7 functional specification or a series of 8 functional specifications, right? 9 A No. I didn't say that. I said you 10 need those final functional specifications and 11 all parts of it to be able to establish and 12 document a final statement of work with 13 acceptance criteria, deliverables, roles and 14 dates. 15 That's exactly what this is saying 16 here. It's like any project, any software 17 project. You've got to get to a statement of 18 work that we can say, yes, we all agree that 19 this is what we're going to do, this is what the 20 vendor is going to do, they have met 21 requirements or they have not met our 22 requirements. 23 Q Let's come at this a different way, 24 because I do have your testimony already on the 25 record. Page 89 1 Let's just understand. At the end of 2 this project inception phase, you effectively 3 have three different things. You would have a 4 set of acceptance criteria, a written document 5 that has acceptance criteria, correct? 6 A Correct. 7 Q And that acceptance criteria as you've 8 told us, at least in part, is going to be used 9 later on in the project to measure the 10 deliverables that will be provided through a 11 final statement of work? 12 A Correct. 13 Q Secondly, you're going to have a 14 project plan, an agreed upon project plan, 15 right? 16 A Correct. 17 Q And that project plan is going to be a 18 written document? 19 A Yes. 20 Q And it's going to have dates and times 21 and roles and completion dates for different 22 aspects of the rest of the project? 23 A Yes and resources. 24 Q And resource requirements. 25 A Yes. 23 (Pages 86 - 89) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 24 of 68 Page 90 1 Q And who is going to be allocated -- 2 A It will give you which pieces of the 3 project. 4 Q Right. Who will be allocated to 5 particular roles. So those are two things. And 6 the third thing which is also going to be either 7 a document or a series of documents is going to 8 be what is titled here final SOW. 9 And in this case, the final SOW itself 10 was going to be manifested through functional 11 specifications? 12 A You will use the functional 13 specifications to build the SOW, but the SOW is 14 a different document. 15 Q You believe the SOW is a different 16 document? 17 A Absolutely. It's a separate document. 18 Q Fine. We'll get into that in some 19 more detail. My question to you, though, is 20 simply this. 21 The functional specifications were 22 presented, whether you agreed with them or not, 23 they were presented to Lincare on October 5, 24 2015, right? 25 A There was a version on October 15th. Page 91 1 There was a version the week before and a 2 version the week before. It was an interim 3 process. 4 Q And that's typical in a project, isn't 5 it? 6 A It's very typical, but it was only in 7 the aspect of Apacheta saying they were final, 8 not in Lincare's. 9 Q I understand and you can have that 10 caveat. We won't argue today. Okay? I'm 11 looking for the facts. Okay? 12 We can agree, we've done this already, 13 that on October 5, 2015, a set of functional 14 specs were sent over to Lincare? 15 A Yes. 16 Q My question to you, and I think you've 17 already answered this, but I just want to make 18 sure we have it clear. You would agree with me 19 that Lincare was in a position to review and 20 reject or approve those specifications at the 21 time you received them? 22 A Yes. We were in a position to review 23 them and we did start the review process. 24 Q 2.2 of the contract at page 14 talks 25 about the configuration and development phase. Page 92 1 2.2(a) says, "Software configuration, setup and 2 initial data load support based on the 3 requirements determined above," right? 4 A Yes. 5 Q The requirements determined above 6 would be the requirements that were set forth 7 for the development effort through the 8 functional specifications, correct? 9 A Do you want me to read this whole 10 section or are you just talking about the first 11 sentence? 12 Q 2.2(a). 13 A Yes. That's what it says. 14 Q 2.2(b), the first bullet point, 15 "Customer, Lincare, shall develop with 16 Apacheta's support, an interface to exchange 17 upload and download data between customer's host 18 system and transport manager." 19 Effectively we're talking about the 20 integration effort that you told us about 21 earlier this morning, right? 22 A Yes. 23 Q That's something that primarily 24 Lincare was responsible for? 25 A No. Page 93 1 Q It says, "Customer shall develop with 2 Apacheta support." You don't agree that that's 3 primarily -- 4 A An interface is two ways. You can't 5 just have Lincare develop the interface. There 6 has to be a receiving end on the Apacheta side. 7 Q I'm not arguing with you, ma'am. It 8 says, "Customer shall develop an interface." At 9 any time, did Lincare ever develop an interface? 10 A They had started the development of an 11 interface. 12 Q When did that happen? 13 A I would say more in the summer of the 14 2015 time frame. 15 Q 2.2(d) is integration testing. 16 "Apacheta internal testing using customer test 17 data, including full connectivity to customer 18 host." 19 What's the purpose of that? 20 A That's to make sure that the data 21 between the host system and the Apacheta system 22 is transferring correctly. 23 Q And 2.2(e) is installation. That's 24 synonymous with actual implementation at Lincare 25 of the new software, right? 24 (Pages 90 - 93) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 25 of 68 Page 94 1 A From a development standpoint. 2 Q Yes. 3 A Yes. 4 Q So it wouldn't be until the end of the 5 efforts in section 2.2 that the software would 6 actually be installed or implemented at Lincare, 7 correct? 8 A Correct. 9 Q Once that happens, the project would 10 move into, and assuming everything went as 11 expected, the project would move into the 12 acceptance test phase, correct? 13 A Correct. 14 Q Let's work our way through what 15 actually happened on the project. Okay? The 16 only one that I think I'm going to repeatedly be 17 coming back to is Exhibit 2. 18 (Exhibit 12 marked for 19 identification.) 20 BY MR. STAR: 21 Q We have marked here as Exhibit 12 a 22 document Bates labeled Lincare 6388. It's an 23 e-mail from Kristen Hoefer dated July 24, 2015. 24 The subject is letter from the CEO. 25 Am I correct in assuming that this is Page 95 1 something that Ms. Hoefer would have sent out to 2 everybody at Lincare as sort of a report of 3 second quarter results? 4 A I can't confirm who it went to, 5 because it just says, "dear colleagues," but it 6 went to a group of people at Lincare. 7 Q And this predates you, obviously, 8 right? 9 A Yes. 10 Q Let me ask you this. Do you remember 11 your exact start date at Lincare? 12 A I would say it was October 1st. 13 Q Prior to October 12th, did you have 14 any other involvement with Lincare? Were you an 15 outside consultant? 16 A No. 17 Q Were you an independent contractor of 18 any sort? 19 A No. 20 Q You kind of just went right from 21 Rotech to starting at Lincare on October 1st? 22 A I had a couple of months in between. 23 Q During that couple of months, you had 24 no involvement with Lincare? 25 A No. Page 96 1 Q Other than, I'm sure, to interview? 2 A Just the interview. 3 Q During the interview, were you made 4 aware that there was a project going on with 5 Apacheta? 6 A I can't remember if Apacheta came up 7 specifically, but the fact that they were trying 8 to work on a Mobility project did come up. 9 Q In the third paragraph here, Ms. 10 Hoefer tells, we're assuming, most of the people 11 or everybody at Lincare that Gary Wolsiefer, the 12 head of the IT department will be retiring at 13 the end of July after 28 years of service. 14 Do you see that? 15 A Yes. 16 Q And it does turn out that Mr. 17 Wolsiefer's last day with Lincare is July 31, 18 2015. 19 A Okay. 20 Q It's not something you know -- 21 A I can't verify that. 22 Q Fine. Do you know why Gary left? 23 A No, I do not. 24 Q He was just at that age that he was 25 deciding to go or did he leave for any other Page 97 1 reason? 2 A I'm not aware of anything other than 3 what it says here. 4 Q We've been told in this case that we 5 can only contact Mr. Wolsiefer through Lincare's 6 counsel. 7 Do you know why that is? 8 A No, I do not. 9 Q Have you had any contact with him 10 since the start of this litigation? 11 A Gary? 12 Q Yes. 13 A I've never talked to him before. 14 Q Above, in the second paragraph, Ms. 15 Hoefer tells the company about the Apacheta 16 project. 17 Do you see that? 18 A Yes. 19 Q She writes, "The project will provide 20 our service representatives with a tablet that 21 will include an automated routing solution, as 22 well as enable a significant reduction in 23 paperwork at time of setup." 24 Do you see that? 25 A Yes. 25 (Pages 94 - 97) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 26 of 68 Page 98 1 Q She writes at the end of the second 2 paragraph, "The project is a significant one and 3 we expect rollout to occur in mid-2016." 4 A Yes. 5 Q And you would agree with me there is 6 no issues or deficiencies with regard to the 7 Apacheta project that Ms. Hoefer identifies in 8 this e-mail? 9 A She does not identify issues. 10 Q And it's safe to say that from 11 Lincare's perspective, as of July of 2015, we're 12 almost seven full months into the project, it 13 was still planning to go forward and actually 14 rollout the solution with Apacheta, correct? 15 A Based on these comments, yes. 16 (Exhibit 13 marked for 17 identification.) 18 BY MR. STAR: 19 Q What I have marked as Exhibit 13 is a 20 one-page document. It's Bates labeled Lincare 21 7888. It's two e-mails on July 30th of 2015. 22 The top e-mail, which is the last in 23 the chain is from Gary Wolsiefer. And we know 24 Mr. Wolsiefer actually signed the contract, 25 right? Page 99 1 A Yes. 2 Q The subject is Apacheta contract. Do 3 you see that? 4 A Yes. 5 MR. LIPMAN: Do you need a minute to 6 read these? 7 A Yes. 8 MR. LIPMAN: I don't want you to be in 9 a position where he's asking a question and 10 you're trying to read it. You're only half 11 hearing the question and you're only half 12 reading it and you may get confused. 13 A Okay. Give me a second. 14 BY MR. STAR: 15 Q Do you see what Mr. Wolsiefer writes, 16 "The Apacheta contract was approved by Shawn." 17 That would have been Shawn Schabel? 18 A Yes. 19 Q "In December of 2014. Based on the 20 contract's intent, we," and that would be 21 Lincare, right? 22 A Yes. 23 Q "Are behind in timeline. We," 24 Lincare, right? 25 A Yes. Page 100 1 Q "Should pay them, Apacheta, some 2 additional dollars since we, Lincare, are the 3 cause of the delay." 4 Do you see that? 5 A Yes. 6 Q Do you know what delays Mr. Wolsiefer 7 was referring to other than what he writes here 8 in the e-mail? 9 A I mean, I can't speak to what he meant 10 by the delays. 11 Q You have no reason personally to 12 dispute what he writes here, that Lincare had 13 actually caused delays in the project? 14 A I have no reason to dispute that. 15 Q Have you gone back and spoken with any 16 of the project team members who were there in 17 July of 2015 to determine whether they shared 18 the same view as Mr. Wolsiefer? 19 A We talked a lot about the project and 20 what the issues were, yes. The delays were on 21 both sides and Apacheta trying to meet some 22 requirements that we set forth upfront. 23 Q Who did you speak to about the cause 24 of the delays on the project? 25 A Rob Batezel. Page 101 1 Q When did you talk to Rob? 2 A Shortly after I got there in October. 3 Barnes Marshall, Craig Kopetz, Mike Moore. 4 There were quite a number of people. 5 Q The last sentence of what Mr. 6 Wolsiefer writes on July 30, 2015, is "They, 7 Apacheta, have been a good partner and never 8 once asked for any further payment, yet continue 9 to keep their resources moving forward." 10 You have no reason to disagree with 11 Mr. Wolsiefer's view, that Apacheta had been a 12 good partner, correct? 13 A I have no reason to dispute with that. 14 Q Kent Hermes you told me is still with 15 Lincare; is that right? 16 A No. 17 Q He left? 18 A Yes. 19 Q When did he leave? 20 A Before I got there. 21 Q So you've never actually spoken with 22 him? 23 A No. 24 Q So Kent had been the system 25 development manager. When you got there in 26 (Pages 98 - 101) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 27 of 68 Page 102 1 October of 2015, was anybody filling that role? 2 A No. 3 Q You told me that Craig Kopetz would 4 have reported to Kent, right? 5 A Yes. 6 Q That Craig Kopetz was the programmer 7 who would have been taking direction from Kent 8 on actually programming the development effort, 9 the integrations, et cetera, right? 10 A Yes. 11 Q I take it Craig Kopetz was still there 12 when you joined? 13 A Yes. 14 Q Who was he being managed by when you 15 joined in October of 2015? 16 A When I joined in October, Barnes was 17 put -- he was already put in charge of the 18 project. He's also a group lead just like 19 Craig. 20 Q Okay. So when you joined, Barnes 21 Marshall is the guy, quote, unquote, in charge 22 of the project from Lincare? 23 A From Lincare, correct. 24 Q To your knowledge, who would have been 25 the guy or woman that was quote, unquote, in Page 103 1 charge of the project for Lincare prior to 2 Barnes, if anybody? 3 A Kent. 4 Q Kent? 5 A Yes. 6 Q So although nobody formally filled the 7 role of system development manager, Barnes 8 Marshall took over as sort of the lead of the 9 project from Lincare when Kent left? 10 A I believe it was prior to Kent 11 leaving. 12 Q Forgive me, you might have already 13 covered this. What was Barnes Marshall's 14 specialty? What was his role in the project 15 other than being sort of in charge of it? 16 A He's a technical lead or programming 17 lead. 18 Q Is he somebody that you personally 19 view as having known Lincare's business well? 20 A Yes. 21 Q Is he still somebody that in your 22 opinion understood Lincare's requirements for 23 Mobility solution? 24 A I believe that he understood the 25 partial requirements. Page 104 1 Q In your opinion, was Barnes Marshall 2 the right person to be in charge of the project 3 from Lincare's side? 4 A I believe at the time, he was the best 5 resource. 6 Q Okay. I get what you're doing. So 7 from your perspective, Mr. Marshall was the best 8 that the company had at the time, but my 9 question was a little bit different and forgive 10 me, I'm entitled to an answer. 11 In your personal view, your 12 professional view, you've been in this industry 13 since the early '80s, was Barnes Marshall 14 qualified in July -- pardon me, in October of 15 2015 to be leading this project for Lincare? 16 MR. LIPMAN: Objection. You can 17 answer, if you have an answer. 18 A From a technical aspect, yes. 19 BY MR. STAR: 20 Q I take it that from some aspects no? 21 A Correct. 22 Q What aspects were lacking in Mr. 23 Marshall's qualifications to be the lead on this 24 project from Lincare? 25 A A business process manager. Page 105 1 Q I think I know what you mean, but 2 let's have you explain that. What does that 3 mean? 4 A From a workflow standpoint, from what 5 is our business operations and how orders flow 6 is really more of a business engineer and not a 7 technical engineer. We had two individuals that 8 were playing that role. 9 Q Who were they? 10 A Tarrah Filo-Loos and Beau McLadddery I 11 think is his last name. 12 Q So Tarrah and Beau, we'll figure out 13 their names sometime later, Tarrah and Beau were 14 from your perspective the business process 15 experts at Lincare? 16 A Yes. 17 Q And so that we've got it on the 18 record, that would have meant that they 19 understood or should have understood what the 20 field service reps would be doing on a daily 21 basis and how they needed the Mobility solution 22 to actually work for them, what process flows 23 and steps they needed to have in the software to 24 complete deliveries and those sorts of things? 25 A Yes. 27 (Pages 102 - 105) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 28 of 68 Page 106 1 Q Were Tarrah and Beau in your opinion 2 qualified to serve in that role? 3 A Yes. 4 Q Are they both still with the company, 5 Tarrah and Beau? 6 A Tarrah is and I believe Beau has left 7 the company. 8 Q Is it Beau Hoy, H-O-Y? 9 A Yes. 10 Q And Beau is B-E-A-U? 11 A Yes. 12 Q And Tarrah is T-A-R-R-A-H? 13 A Yes. 14 Q And the last name is Filo-Loos with a 15 hyphen, F-I-L-O-L-O-O-S? 16 A Yes. 17 Q And she's still with Lincare? 18 A Yes. 19 Q What does she do these days? 20 A She's a regional manager. RM we call 21 them. 22 Q Working in IT? 23 A No, no, no. In the business. In the 24 operation side. 25 Q So during the project, she would have Page 107 1 been consulted with regard to what the field 2 service reps need in the solution? 3 A Yes. Both Beau and Tarrah were 4 regional managers. 5 Q So in sort of IT lingo, they would 6 have been brought in as subject matter experts 7 on what the processes were, right? 8 A Correct. 9 (Exhibit 11 marked for 10 identification.) 11 BY MR. STAR: 12 Q So what I've marked here as Exhibit 11 13 is Lincare 6282. It's an e-mail chain. You can 14 take as much time as you want to read it. I 15 don't think you have to read the whole thing 16 because I'm only going to ask you about a little 17 of it. 18 We see that it's an e-mail chain on 19 August 31, 2015. And the subject is Apacheta 20 contract addendum, payments for software and 21 services. 22 Do you see that at the top? 23 A Yes. 24 Q I'm interested in the e-mail in the 25 middle between Kent Hermes and Greg McCarthy, Page 108 1 August 31, 2015. The last paragraph, paragraph 2 four of Kent's e-mail reads, "These guys." He's 3 referring to Apacheta, of course, right? 4 A Correct. 5 Q "Apacheta have been excellent to work 6 with in spite of our." That's Lincare, right? 7 A Correct. 8 Q "In spite of Lincare's delays. I 9 recommend that we consider some modification to 10 maintain our good relationship." 11 Do you see that? 12 A Yes. 13 Q And you have no reason to dispute Mr. 14 Hermes's opinion on August 31, 2015, that 15 Apacheta had been excellent to work with? 16 A I have no reason to dispute that. 17 Q Or his opinion that there had been 18 delays from the Lincare side? 19 A I have no reason to dispute that. 20 (Exhibit 14 marked for 21 identification.) 22 BY MR. STAR: 23 Q So what we've marked here as 24 Exhibit 14 is a document that was produced out 25 of Apacheta's files, Bates labeled Apacheta Page 109 1 11406 and 407. Take a moment and familiarize 2 yourself. There's two e-mails in the chain. 3 A Okay. 4 Q The first e-mail from Barnes Marshall 5 of August 28, 2015, he's writing to Hoy, Beau 6 Hoy to Tarrah Filo-Loos, a copy to Kent, Rob 7 Batezel and Craig Kopetz, right? 8 A Yes. 9 Q So you would agree with me that as of 10 August 28, 2015, the people on this e-mail are 11 really the core of the project team from Lincare 12 at that point in time? 13 A At that time, but as you can see at 14 the bottom, they wanted to include legal, 15 compliance, safety and others. 16 Q I see that. My question, but my 17 question is, though, with respect to the -- let 18 me be more specific. 19 We can agree that with respect to the 20 actual day-to-day involvement in this project, 21 the people Mr. Marshall included and then the 22 people he sends this e-mail to, that's the core 23 project team for Lincare, right? 24 A Yes. 25 Q And the subject is final operations 28 (Pages 106 - 109) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 29 of 68 Page 110 1 project sign-off. And Barnes Marshall writes, 2 "Apacheta has provided us with three project 3 specification documents TransportAce, Transport 4 Manager and Integration) that define the scope 5 of the project and the functionality and process 6 flow of the tablet." 7 Do you see that? 8 A Yes. 9 Q You have no reason to disagree with 10 Mr. Marshall and his opinion on August 28th, 11 that the documents that have been provided were 12 meant at least to define the scope of the 13 project and the functionality and process flow 14 of the tablet? 15 A I have no reason to disagree. 16 Q And the title of this is final 17 operations project sign-off. You would agree 18 that at least in Mr. Marshall's view on behalf 19 of Lincare at this time, signing off and 20 eventually agreeing to those three functional 21 specifications would move you and the project 22 into the next phase? 23 A No. I do not agree with that. 24 Q You don't agree with his opinion on 25 that? Page 111 1 A No. I don't agree that this was all 2 of the functional requirements. This was three 3 of them. 4 Q I get that you think that there should 5 be more, and we're going to get into that, but 6 we can agree that Mr. Marshall doesn't say there 7 should be more, right? 8 A These three. 9 Q He doesn't say there should be four or 10 five or six of them. He says these three. 11 A He doesn't say it, but there 12 definitely is more functional requirements that 13 come after this. 14 Q He writes next in the same e-mail on 15 August 31, 2015 to Cora Forgeng, and she's at 16 Apacheta, copying others within Lincare. He 17 writes, "Cora, we said you would have the 18 revised specs back to us by the 11th. I'm 19 trying to schedule an aggressive review on our 20 side for final sign-off." 21 From Lincare's perspective, Mr. 22 Marshall is running this project, what in 23 Lincare's perspective does final sign-off mean 24 as of August 31, 2015? 25 A Sign-off on these specific documents. Page 112 1 Q So Mr. Hermes is still on the project, 2 because he's copied on August 28th and 3 August 31st, right? 4 A Yes. 5 Q But roughly a month later when you 6 join, he's gone? 7 A Correct. 8 Q Do you know why? 9 A It was an illness. 10 Q Was he ill or was somebody else ill? 11 A His wife was ill. 12 Q So he left because his wife was ill? 13 A Correct. 14 Q And he never came back? 15 A No. 16 (Exhibit 15 marked for 17 identification.) 18 BY MR. STAR: 19 Q Take your time and familiarize 20 yourself with what we've marked as Exhibit 15. 21 For the record, it's an e-mail chain, Bates 22 labeled Lincare 7604 and 7605. It begins with 23 an e-mail dated September 24, 2015. 24 A Okay. 25 Q The second e-mail from the bottom on Page 113 1 the second page of the document is from Barnes 2 Marshall on September 15, 2015. He writes to 3 Greg McCarthy. Mr. McCarthy is the COO at the 4 time? 5 A Yes. 6 Q He copies Rob Batezel. And Barnes 7 writes about an agenda for a meeting where 8 there's going to be a live demo of the tablet 9 software to demonstrate the flow and process. 10 Do you see that? 11 A Yes. 12 Q And then if we work our way through 13 the e-mail chain, there's another e-mail from 14 Rob Batezel to McCarthy and Marshall, dated 15 September 24, 2015. 16 Do you see that one? 17 A Yes. 18 Q And you understand that Mr. Batezel is 19 reporting on what happened during the demo? 20 A Yes. 21 Q So Batezel writes, "Hello, Greg. I 22 can provide you with a brief update on where we 23 are at with this project. 24 As you know, we had our webinar with 25 the operations team last week to review both the 29 (Pages 110 - 113) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 30 of 68 Page 114 1 transport manager and TransportAce 2 functionality. This demo also included all of 3 the custom functionality that we have discussed 4 with Apacheta?" 5 So we can agree that at least in Mr. 6 Batezel's view as of September 24, 2015, 7 Apacheta had actually presented a demonstration 8 of the software that included all of the custom 9 functionality that Lincare had identified at 10 that time? 11 A Not from a software standpoint. It 12 was prototype screens. 13 Q He goes on to say, "The demo was well 14 received by the operations team." You have no 15 personal reason to dispute that the operations 16 team received this well, right? 17 A No. In concept, a tablet solution is 18 something that they know will help them. 19 Q He goes on to write in the second 20 paragraph, "We are currently finalizing the 21 specification with Apacheta." 22 We can agree that what he's meaning is 23 the functional specifications? 24 A I believe that's what he means. 25 Q "We expect to have that wrapped up Page 115 1 next week." We will then give Apacheta the okay 2 to move forward with making our custom changes 3 to their applications." 4 Do you see that? 5 A Yes. 6 Q And those custom changes to the 7 applications, the actual development work, would 8 be done during the second phase of the project. 9 And if we go back to the contract 10 itself, on page 14, section 2.2, that's the work 11 that would be done during the configuration and 12 development phase, right? 13 A If the SOW was accepted correct. 14 Q So as of September 24, 2015, Rob 15 Batezel is reporting to Greg McCarthy who is the 16 COO with a copy to Barnes Marshall who leads 17 this project, that currently Lincare is 18 finalizing the specification with Apacheta. And 19 that once that's wrapped up, Apacheta will have 20 the okay to move forward essentially with the 21 configuration and development phase, right? 22 A If it's signed off on, correct. 23 MR. STAR: This will be 16. 24 (Exhibit 16 marked for 25 identification.) Page 116 1 BY MR. STAR: 2 Q What we've marked as Exhibit 16 is an 3 e-mail chain, Bates labeled Lincare 7202 through 4 7204. And if you look at the first e-mail in 5 the chain, which is at the bottom of 7203, it is 6 an e-mail from Michael Moore to you, Saturday, 7 October 3, 2015. The subject is Apacheta 8 software license and services agreement, 9 importance, high. Do you see that? 10 A Yes. 11 Q So your recollection is that you had 12 started around October 1st, which would have 13 been a Thursday based on this? 14 A Yes. 15 Q And on the first Saturday of your 16 employment, Mr. Moore -- and remind me his 17 involvement exactly at this point? 18 A IT operations security and networks. 19 Q And he's writing to you about the 20 contract. Why would Mr. Moore who is involved 21 in IT operations and security and networks be 22 writing to you about the contract? 23 A Mike came and talked to me, I think it 24 was probably my second day there with his 25 concerns about security, HIPAA risks with Page 117 1 Apacheta and software. 2 Q Anything else that he was concerned 3 about? 4 A That was his main involvement. 5 Q What did he tell you? 6 A That they have -- we've given them 7 ample opportunity to meet a requirement to use 8 our Active Directory for authentication and they 9 have come back multiple times and said they were 10 not be able to do that, which puts us at a 11 security risk that he feels that we cannot 12 accept. 13 Q Did he tell you how that purported 14 requirement was communicated to Apacheta? 15 A Verbally in the January kickoff 16 meeting and many times in the conference calls 17 and in writing and I believe sometime prior to 18 this, in the September time frame. 19 Q So Mr. Moore's concern centered on 20 HIPAA privacy issues and security? 21 A Correct. 22 Q Centering around the Active Directory 23 for authentication? 24 A The inability for Apacheta to use 25 Active Directory for authentication and user 30 (Pages 114 - 117) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 31 of 68 Page 118 1 security roles. 2 Q What is Active Directory? 3 A So Microsoft Active Directory is when 4 you -- it's your credentials and it has your 5 role in the company. And you have to -- when a 6 new employee starts, you put them into Active 7 Directory. That's how they get their e-mail 8 account. That's how they get their role 9 security in all of the systems. 10 Q And it authorizes them to access 11 particular places in the system? 12 A Correct. It's the first place you 13 have to go when you term an employee so that 14 their access -- 15 Q Do you mean terminate? 16 A Terminate an employee so their access 17 to all systems is immediately disabled. 18 Q Certainly Apacheta's software must 19 have had some way in which to provide 20 authorizations for particular users? 21 A Not from an Active Directory 22 standpoint. 23 Q You're telling me Active Directory, 24 though, is a Microsoft product? 25 A Right. Page 119 1 Q Was there a different software product 2 that Apacheta used within his solutions? 3 A It had its own internal user access. 4 We would have to maintain all of our users in 5 their separate application. 6 Q So there was a solution that Apacheta 7 had in order to protect things like privacy and 8 to make sure that certain users had access to 9 certain parts of the software and others didn't. 10 And that if a person left the company or was 11 fired, you could terminate their access. 12 A Not without someone manually going in 13 there and doing that. So the HIPAA risk is if 14 you try to maintain it in a whole separate 15 system, if someone terms and is not terminated 16 immediately, they could take the PHI, which 17 would be in Apacheta's system and send it on, 18 because it's a web-based system. 19 Q What is PHI? 20 A Protected Health Information. So that 21 was one of many concerns that folks had come to 22 me and talked to me about Apacheta. That was 23 our biggest concern, that they had said they 24 just cannot do it. The application was not 25 capable of doing it. Page 120 1 Q Mr. Moore writes in his e-mail of 2 October 3, 2015, "Had a great conversation with 3 you yesterday. Per our conversation, I wanted 4 you to see the terms of the contract so you 5 understood where -- so you understood where we 6 stood and how quickly we need to assess whether 7 this is the correct product to move forward 8 with," right? 9 A Yes. 10 Q And then he lays out some of the terms 11 of the contract. Had you actually seen the 12 contract as of October 3, 2015? 13 A No. I believe I got it right after 14 this e-mail. 15 Q He writes here, "The termination 16 clause is 30 days written notice, but the 17 termination events are limited." 18 Do you see that? 19 A Yes. 20 Q What do you understand him to have 21 meant by 30 days written notice? 22 A That there has to be, in my 23 understanding, we have to say that we're not 24 going to accept, because we are still in the 25 acceptance period, which ends on 12/16/2015, Page 121 1 which we weren't at that point yet. After the 2 acceptance state, if we accept, we will owe them 3 250. 4 Q My question is a little bit different. 5 The sentence here reads, "The termination clause 6 is 30 days notice, but the termination events 7 are limited," and he says page 3. He's 8 referring to page 3 of the contract, right? 9 A Correct. 10 Q My question is, what do you understand 11 by the words 30 days written notice? What does 12 that mean to Lincare? 13 MR. LIPMAN: Objection. Are you 14 asking, what does she understand that to 15 mean now or at the time not having seen the 16 contract what did she understand it to 17 mean? 18 It says what it says. She's going to 19 describe the meaning that it says on the 20 paper. 21 MR. STAR: Don't testify. Thank you 22 for clarifying, but let's not go further 23 than that. 24 BY MR. STAR: 25 Q It doesn't really matter when you 31 (Pages 118 - 121) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 32 of 68 Page 122 1 understood it, because I can't imagine that your 2 understanding of this simple phrase would have 3 changed. Okay? 4 I'm asking you as the corporate 5 designee for Lincare, what is the company's 6 understanding of 30 days written notice? What 7 does that mean to you? 8 MR. LIPMAN: Objection. Are you 9 asking about this e-mail generally or about 10 the contract? 11 MR. STAR: Well, you're making it 12 harder than it needs to be, but let's go to 13 the contract. 14 BY MR. STAR: 15 Q Mr. Moore refers to page 3. So let's 16 go to page 3 of Exhibit 2, which is the 17 contract. 18 A Page 3? 19 Q Yes. 20 A Okay. 21 Q And we see on page 3, there's a 22 section 5 titled term and termination. And we 23 see at 5.1 -- 24 A I'm sorry, I'm on page 2. 25 Q Page 3 of the contract. Section 5, Page 123 1 term and termination, do you see that? 2 A Yes. 3 Q And you're familiar with this, right? 4 A Yes. 5 Q Because you reviewed the contract 6 shortly after Mr. Moore's e-mail to you on 7 October 3, 2015? 8 A Correct. 9 Q In fact, that's something you did the 10 very next week? 11 A Yes. 12 Q Section 5.1 is the term, right? 13 A Yes. 14 Q And we can agree without having to 15 read all of the language, that this was going to 16 be and that this was an initial three-year term 17 of the contract, correct? 18 A No. I don't agree with that. 19 Q Okay. Let's read it. "Unless 20 otherwise indicated in Exhibit A, the term of 21 this agreement begins on the effective date and 22 continues for a period of three years 23 thereafter, unless terminated sooner in 24 accordance herewith the initial term." 25 A Right. Page 124 1 Q You don't agree with me that the 2 initial term of this contract is three years? 3 A Well, because it says, "Sooner in 4 accordance herewith the initial term." 5 Q Pardon? You're saying, unless 6 terminated sooner? 7 A In accordance with the initial term. 8 Q The initial term was three years 9 unless terminated sooner; we can agree? 10 A No. I don't read it that way. 11 Q How do you read it, ma'am? I want to 12 know how the company reads this language. Tell 13 me that. 14 A So unless otherwise indicated in 15 Exhibit A, which it does indicate in Exhibit A, 16 that there is an acceptance period. So you 17 can't just take that out. It says that the SOW 18 overrides the contract and there's an acceptance 19 period in the SOW in Exhibit A. 20 The term of this agreement begins on 21 the effective date continuing for a period of 22 three years thereafter, unless terminated sooner 23 in accordance herewith the initial terms. 24 Q I don't understand that at all. What 25 do you believe was the initial term of this Page 125 1 contract? 2 A I believe the initial term of the 3 contract was three years after an acceptance 4 period of the SOW being accepted. 5 Q Really? 6 A Yes. 7 Q Just so I've got this clear, is that 8 Linda Reid's personal interpretation or is this 9 Lincare's official interpretation of a very 10 clear contract it signed on December 16, 2014? 11 MR. LIPMAN: Objection. You can 12 answer. 13 A It's clear that in Exhibit A there is 14 a clause that the statement -- 15 BY MR. STAR: 16 Q Ma'am, that's not my question. Hold 17 on, my question was simple and I want an answer. 18 The interpretation that you're giving me right 19 now, is that your personal interpretation or is 20 that Lincare's official interpretation, which is 21 going to be used for purposes of this case? I'm 22 entitled to know that. 23 A That is my interpretation of the 24 contract. 25 Q You're here today as the corporate 32 (Pages 122 - 125) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 33 of 68 Page 126 1 reasons. One of the topics in the notice of 2 deposition, it's item number 3, "Lincare's 3 understanding of the software license and 4 services agreement attached as Exhibit 1 to 5 Apacheta's complaint." 6 Of course, that's the complaint that 7 we've been talking about and we've marked as 8 Exhibit 2, right? 9 A Yes. 10 Q Are you telling me now that you're not 11 capable today to testify on behalf of Lincare as 12 to its official corporate understanding of the 13 terms of this contract? 14 A No, I am capable. 15 Q So when I ask you questions about what 16 Lincare understands the language in section 5.1 17 of the contract to mean, I want to know from 18 you, am I getting your personal view or are you 19 telling me this is Lincare's official corporate 20 position? 21 MR. LIPMAN: Objection. She already 22 provided that answer. 23 MR. STAR: I don't have it. 24 MR. LIPMAN: It's her opinion. 25 MR. STAR: Don't interrupt, because if Page 127 1 she's not able to give it, then somebody 2 else from the company -- then frankly, I 3 don't care what her opinion is. 4 MR. LIPMAN: Then ask her, do you know 5 what Lincare's position is. 6 MR. STAR: I'm getting there. I just 7 want this part of the record clear. 8 MR. LIPMAN: Okay. 9 BY MR. STAR: 10 Q What you've told us so far, ma'am, is 11 your personal opinion. Are you able to tell me 12 today what Lincare's official view and 13 interpretation is about section 5.1 of this 14 contract? 15 A Lincare's view is in 5.1, the term of 16 the contract in Exhibit A has a clause that we 17 have to accept the SOW before we go into this 18 three-year term. 19 Q So in Lincare's official view, the 20 three-year term doesn't begin until there's 21 acceptance? 22 A Correct. 23 Q Who within Lincare came up with that 24 so-called official interpretation of section 5.1 25 and the initial term? Page 128 1 A I'm not sure I understand your 2 question. 3 Q Who within Lincare came up with the 4 interpretation of section 5.1 that you've just 5 testified about? Is that you? Was that a team 6 of people? 7 A Multiple people have looked at this 8 and came up with the same interpretation. 9 Q Who? Who are those people? 10 A Myself, legal. 11 Q When did Lincare come up with this 12 official interpretation? 13 A I don't know the exact date. 14 Q Can you approximate the date? 15 A It would have been later in October 16 after I came and presented the issues. 17 Q We're going to get into what issues 18 you may or may not have presented. Who is Tom 19 Blades? I don't think we've mentioned his name. 20 Are you familiar with Tom Blades? 21 A I'm not familiar Tom Blades. 22 MR. STAR: I'm going to mark this as 23 the next exhibit. It's 17. 24 (Exhibit 17 marked for 25 identification.) Page 129 1 BY MR. STAR: 2 Q So Exhibit 17 is a one page e-mail 3 produced from Lincare, Bates labeled Lincare 4 9667. If you look at the e-mail information at 5 the top, this is the way it was produced to us. 6 It doesn't say who it was from. 7 It says it was to Tom Blades and 8 Kristen Hoefer. It doesn't say when it was sent 9 and it doesn't have a subject. 10 Do you know why the e-mail would be 11 produced in this way without that information on 12 it? 13 A No, I do not. 14 Q Is there a way to go back and figure 15 out when this e-mail would have been sent? 16 A I'm sure it was archived. We have an 17 automatic archiving on our e-mails. So our 18 e-mails only stay out there for so many months 19 and they are archived. My assumption is it was 20 archived. 21 Q Is there a way to go back and figure 22 out what the actual date was and who this was 23 sent from and whether there was a subject line? 24 A I'll have to check with IT operations 25 on that. 33 (Pages 126 - 129) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 34 of 68 Page 130 1 Q It doesn't have anybody signing off on 2 this, but somebody is writing to Tom Blades. It 3 says, "Good morning, Tom. As per your request, 4 I wanted to give you an update on our tablet 5 program for our services reps." 6 Do you see that? 7 A Yes. 8 Q And just so we're clear, because we're 9 having trouble with obviously knowing who this 10 was from and when it was sent, given that it has 11 a Lincare Bates number, we can agree that this 12 is a Lincare document that came out of your 13 business records, right? 14 A Yes. 15 Q So what the unknown author writes is, 16 "The application we are using is provided to us 17 from Apacheta and we have a current agreement in 18 place for the next three years at $750,000 per 19 annum." Do you see that? 20 A Yes. 21 Q It goes on at the next bullet, "We are 22 in the development stage with them on the actual 23 functional specifications." 24 Do you see that? 25 A Yes. Page 131 1 Q You're telling me now, though, that 2 it's Lincare's view that there wasn't actually 3 an agreement in place for three years; there was 4 an agreement for something else? 5 A There was an inception phase to 6 approve the concept that had be accepted before 7 this agreement would be in full force. It's 8 clearly defined in the exhibits. 9 Q Can you agree with me if you look at 10 the very first paragraph on page 1 of the 11 contract, the second term defined on the second 12 line is the effective date of the contract? Do 13 you see that? 14 A Yes. 15 Q And the effective date is December 15, 16 2014? 17 A Yes. 18 Q Let's go back to Exhibit 16. After 19 the e-mail from Mr. Moore to you on October 3rd, 20 there's then an exchange of e-mails between 21 yourself and primarily Paul Tripp with copies to 22 other people. 23 And we've got redactions of four 24 different e-mails up through October 29, 2015. 25 Do you see that? Page 132 1 A Yes. 2 Q Without telling me what you discussed 3 with Mr. Tripp, I'd like to know what was the 4 purpose of you communicating with Mr. Tripp? 5 Why were you going to him? 6 A To review the contract. 7 Q What was the reason you wanted to 8 review the contract? 9 A To make sure we understood it in legal 10 terms. 11 Q Why did you need to understand it in 12 legal terms? 13 A Because it's very confusing. 14 Q Well, beyond that, were you intending 15 to do anything? 16 A We had concerns at this point, many 17 concerns. 18 Q Okay. You had concerns. My question 19 is, were you intending to do anything and take 20 action on those concerns? 21 A Not at that moment. Are you talking 22 about the Michael Moore e-mail or all of these 23 different e-mails? 24 Q I'm referring to your e-mails and your 25 communications with Mr. Tripp. What we can see Page 133 1 here is within 48 hours or so of you joining the 2 company on October 1st, you're already in 3 discussions with Mr. Moore about the terms of 4 the contract, and he's telling you how it can be 5 terminated, right? 6 A Who? 7 Q Mr. Moore. 8 A Yes. His interpretation of the 9 contract. 10 Q And then the very next week, you start 11 reviewing the contract? 12 A Correct. 13 Q And then within the same month that 14 you joined the company, you go to Mr. Tripp who 15 is the head of legal for Lincare and you're 16 asking him about the contract? 17 A Correct. 18 Q And my question to you is, why did you 19 go to Mr. Tripp? Why did you need legal advice? 20 A Well, I wanted to make sure I 21 understood the terms of the agreement and also 22 from a requirement standpoint, my folks are 23 giving me lots of issues with the Apacheta 24 software. And I'm trying to get my arms around 25 the project, I sat in on the Apacheta call, I'm 34 (Pages 130 - 133) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 35 of 68 Page 134 1 looking at what requirements had been provided. 2 So there was a lot of work that I was doing 3 trying to understand this. 4 Q Your e-mail at the top of this chain, 5 October 29, 2015, you write to Rob Batezel, 6 "Please prepare whatever you have for a meeting 7 with Paul after 1:00 tomorrow." 8 What were you asking Rob to repair? 9 A Background on the project. 10 Q Did he prepare it? 11 A I believe so. 12 Q In what form was it prepared? 13 A I think he just gave the requirements 14 or where they were so far. 15 Q Did he prepare a PowerPoint, a Word 16 document? 17 A No. 18 Q Anything like that? 19 A It was whatever documents and specs 20 they had worked on so far. 21 Q And was there actually a meeting with 22 Paul on October 30th? 23 A I can't answer that for sure. There 24 was a meeting. I don't know if it was on that 25 specific date. Page 135 1 Q At this point in time, October 29th of 2 2015, did Lincare make a decision to terminate 3 the project? 4 A On which date? 5 Q October 29, 2015. 6 A No. 7 Q At some point, that decision is made? 8 A Yes. 9 Q When to your recollection was the 10 decision to terminate the project actually made? 11 A I don't know the exact date. 12 Q We know we're going to get to it. 13 We'll take a break here in a little bit and grab 14 a quick lunch. 15 The actual termination letter goes out 16 on February 1, 2016, right? 17 A Yes. I did see that. 18 Q To your recollection, how far in 19 advance of that letter had Lincare officially 20 made the determination it was going to terminate 21 this contract? 22 MR. LIPMAN: Objection, but you can 23 answer. 24 A I don't know the exact date. It was 25 in that end of yearish time frame. Page 136 1 MR. STAR: Let's take a break. Can we 2 do a half? 3 (A luncheon recess was taken from 4 12:00 Noon to 12:35 p.m.) 5 BY MR. STAR: 6 Q We're back after lunch. I want to go 7 back to what we were talking about before we 8 took our break. 9 We were on page 3 of the contract, 10 section 5.1, term. I just want to make sure I 11 understand Lincare's official view. 12 The effective date of the contract in 13 Lincare's view remained as stated on the first 14 page, December 14, 2014, right? 15 A I'm sorry, you said page 3? 16 Q I'm on page 3, section 5.1, which is 17 entitled term. It mentions the effective date. 18 Do you see that, "Unless otherwise indicated in 19 Exhibit A, the term of this agreement begins on 20 the effective date?" 21 A Yes, I see that. 22 Q I want to understand Lincare's 23 position. Is it Lincare's position, that the 24 effective date of this contract remained as 25 stated on the first page of it, which is Page 137 1 December 15, 2014? 2 A Yes. 3 Q So the effective date never changed? 4 A No. 5 Q So the contract was in effect as of 6 December 15, 2014? 7 A Yes. 8 Q If you look back at Exhibit 16, this 9 is the first e-mail from Mr. Moore to you on 10 October 3, 2015. 11 We were talking about this a little 12 while ago. His second bullet point is, "The 13 termination clause is 30 days written notice, 14 but the termination events are limited." He 15 refers to page 3. 16 A Okay. 17 Q You saw the contract itself for the 18 first time the next week, correct? 19 A Yes. 20 Q And having gotten this e-mail from Mr. 21 Moore on October 3rd and then yourself reviewing 22 the contract the following week, did you 23 understand -- what in the contract, if anything, 24 did you understand Mr. Moore to be referring to 25 when he wrote the termination clause is 30 days 35 (Pages 134 - 137) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 36 of 68 Page 138 1 written notice, but the termination events are 2 limited? Is there a particular spot in the 3 contract that you understood him to be referring 4 to? 5 A I'm not sure that I went back looking 6 at the contract based on my summary. 7 Q Did you go into the contract when you 8 first reviewed it to figure out what the 9 termination clause was? It would have been the 10 week of October 5, 2015. 11 A Not specifically for that. I went in 12 to try to understand the contract, in general. 13 Q At some point, though, you personally 14 reviewed the termination clause, I take it? 15 A Yes. 16 Q Would that have been around the week 17 of October 5th? 18 A I would say that it was around that 19 first or second week of reviewing it. 20 Q And the termination clause is at 21 section 5.2 on page 3, correct, of the contract? 22 A 5.1 and 5.2 and 5.3. 23 Q Well, 5.1 through 5.3 under the 24 heading term and termination. 25 A Correct. Page 139 1 Q Tell me in Lincare's view -- if you're 2 not able to tell me Lincare's official view, I 3 want to know that too, but I'd to know from 4 Lincare's official view as to the circumstances 5 under which is able to terminate or it was able 6 to terminate this contract? 7 MR. LIPMAN: I'm going to object, but 8 she can answer if she has a response. 9 MR. STAR: This is important. If 10 there's something I can do to fix the 11 objection, let me know. 12 Is it a foundation thing? 13 MR. LIPMAN: The objection is to form. 14 I believe the document speaks for itself 15 and Lincare's view. Of what the document 16 says and what it would mean is largely 17 irrelevant. 18 It's not really Lincare's position in 19 an integrated document. That would be my 20 objection. I don't know if that's the 21 objection we're going to take, but 22 generally speaking, the document speaks for 23 itself in all of these. 24 BY MR. STAR: 25 Q Ma'am, do you agree that the document Page 140 1 here in section 5 with regard to the term and 2 termination is clear? 3 A Yes. 4 Q There's nothing ambiguous about it? 5 A The initial term is ambiguous in my 6 mind. 7 Q Other than your belief that the 8 initial term itself is ambiguous, is there 9 anything ambiguous in section 5 of the agreement 10 as to the means by which Lincare could terminate 11 the contract? 12 MR. LIPMAN: Objection. It requires a 13 legal analysis of it, but again, she's here 14 as a corporate designee. She can provide 15 testimony in regard to your questions. 16 MR. STAR: I'm not asking for a legal 17 conclusion. She's able to tell us on 18 behalf of the company, whether the company 19 views the language as being clear and 20 unambiguous. She said that with the 21 exception of in her view what the initial 22 period was. 23 She's qualified and it's part of the 24 deposition notice to tell us how the 25 company interprets the contract. Page 141 1 BY MR. STAR: 2 Q Let's try it this way. Can you agree 3 with me that the only means stated for 4 termination of the contract by Lincare is in 5 section 5.2, termination on breach? 6 A No, because in section 5.1 it says, 7 "Unless otherwise indicated in Exhibit A." 8 Q Is that your answer? 9 A Yes. 10 Q Is there any spot within Exhibit A, 11 which is the statement of work, where there is a 12 means by which Lincare was permitted to 13 terminate the agreement? 14 A In the acceptance criteria. 15 Q Tell me exactly where you're referring 16 to and what you're referring to. 17 A On page 9, starting with the payments 18 and terms, "The initial service fee of $30,000 19 is due and payable upon the effective date of 20 this agreement for the project inception phase. 21 The project inception phase cost is 22 billed on a time and material basis. Upon 23 completion of the project inception phase and 24 final SOW acceptance, such acceptance not to be 25 unreasonably withheld, the balance of the 36 (Pages 138 - 141) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 37 of 68 Page 142 1 service fee is due. 2 Payment schedule, software licenses. 3 The annual software licensing fee is due and 4 payable according to the prorated license 5 schedule for the first year after the acceptance 6 date described below in section 2.1 of this 7 exhibit. 8 Thereafter, the full non-prorated 9 license fee is due on each annual anniversary of 10 the acceptance date for the term of this 11 agreement. The acceptance date is defined in 12 Exhibit C of this agreement." 13 Q Is that your complete answer? 14 A Yes. 15 Q You can agree with me that nothing 16 that you just read from page 9 of the contract 17 says anything about a means by which Lincare 18 could terminate any part of the agreement, 19 correct? 20 A I believe it says that we have the 21 ability to accept or not accept before the 22 continuation of the payment schedule. 23 Q Ma'am, you can agree with me that 24 there's nothing in what you just read from page 25 9 under payments and terms that details any way Page 143 1 in which Lincare could terminate this contract? 2 MR. LIPMAN: Objection. I think she 3 just provided an answer where she said no. 4 That's her answer. You might not like it, 5 but it's her answer. 6 A The answer is -- 7 MR. STAR: Look, there's no actual 8 objection to that question that's valid. 9 MR. LIPMAN: The objection is asked 10 and answered. 11 MR. STAR: It wasn't asked and it 12 wasn't answered. I asked her a different 13 question. 14 BY MR. STAR: 15 Q The word termination doesn't appear 16 anywhere under payments and terms on page 9 of 17 the contract, does it? 18 A I agree the word termination does not 19 show in this section. 20 Q Let me understand Lincare's view. Am 21 I to take it as Lincare's view that you can just 22 stop the contract at any time, whether Apacheta 23 was in breach of the contract or not? You could 24 just say, hey, were done and we could get out of 25 the thing? Is that your view. Page 144 1 A No. That's not my view. 2 Q What is your view on the means by 3 which under the language of this contract 4 Lincare could actually terminate it? 5 A Based on the inception phase, which is 6 a proof of concept. And that's why it's stated 7 here very clearly, that in working through the 8 requirements of Lincare and Lincare agrees that 9 the software will work for them and we accept 10 it, then we continue with the contract. 11 With every contract, when it comes to 12 software development, you have to have a period 13 of proof of concept and agree on requirements or 14 you don't go forward. 15 I've never written a contract that you 16 don't have that, because you would be taking a 17 very large risk of the company if something 18 doesn't work for your needs. It's very 19 standard. 20 Q Forgive me for continuing to ask, 21 because I'm confused by your answer. I'm trying 22 to get to the bottom of what the company's 23 position is. I hope you can understand that. 24 A Okay. 25 Q I think, and you tell me if I'm wrong, Page 145 1 what you're saying is that if you got to the 2 point where the deliverables during the project 3 inception phase didn't meet what you thought 4 were your needs, your position is you could 5 terminate at that point? 6 A Yes. 7 Q Is it your position that Apacheta 8 would need to have been in breach of the 9 contract in order for Lincare to terminate at 10 that point? 11 A I'm not understanding in breach. 12 Q Well, let's look back at section 5.2. 13 It's titled termination on breach. It's pretty 14 clear; you would agree? 15 A What section? 16 Q 5.2 on page 3. 17 A Okay. 18 Q You've now read section 5.2? 19 A Yes. 20 Q Do you agree that the language is 21 clear? 22 A Yes. 23 Q There's nothing confusing in that 24 language? 25 A No. 37 (Pages 142 - 145) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 38 of 68 Page 146 1 Q It provides on how Lincare can 2 terminate the agreement if, for example, 3 Apacheta were in breach of the agreement, 4 correct? 5 A Correct. 6 Q In sum and substance it says, that if 7 Apacheta were in breach, Lincare could terminate 8 following 30 days written notice to Apacheta, 9 the breaching party, specifying any such breach, 10 unless within the period of such notice, all 11 breaches specified therein are remedied, right? 12 A Correct. 13 Q So we can agree that if Lincare had 14 determined that Apacheta were actually in breach 15 of the contract and Lincare wanted to terminate, 16 Lincare would have to do two things. It would 17 have to provide a written notice with at least a 18 30-day period, right? 19 A Yes. 20 Q And it would have to specify the 21 breach, correct? 22 A Correct. 23 Q At any time did Lincare ever provide 24 Apacheta with written notice providing a 30-day 25 period and specifying any breach of the contract Page 147 1 by Apacheta? 2 A Lincare in e-mails and verbally said 3 to Apacheta that you are not meeting the 4 requirements of several things. And they never 5 responded on how they were going to cure it 6 other than they could -- not maybe the words -- 7 I can't say that the e-mails had the word breach 8 in them, but they were very explicit as to we 9 have to have this capability. 10 Q I've never -- strike that. Are you 11 able as we sit here today to identify for me any 12 written document wherein Lincare notified 13 Apacheta that Apacheta was in breach of the 14 agreement? 15 A There was not an e-mail that said that 16 they were in breach. They were e-mails saying 17 that these are requirements we have to have. 18 Q Is there a letter that ever said 19 Apacheta was in breach? 20 A Not that I'm aware of. 21 Q You're not aware of any document that 22 Lincare ever sent to Apacheta telling Apacheta 23 that Lincare believed Apacheta was in breach of 24 any term or condition of this contract? 25 A The nonacceptance of the acceptance Page 148 1 criteria said we do not accept and here are the 2 reasons. 3 Q Well, we'll get into that. My 4 question is more specific. I'm not trying to 5 trick you. I know you have explanations that 6 you want to offer, and you can offer them when 7 appropriate, but my question is very specific. 8 There is no communication, written 9 communication, an e-mail or a letter or anything 10 else from Lincare to Apacheta at any time 11 telling Apacheta that Lincare believed that 12 Apacheta was in breach of this contract, 13 correct? 14 A I have not seen any communication that 15 had the words breach in it. 16 Q Also, there's no written communication 17 at any time from Lincare to Apacheta giving 18 Apacheta 30 days notice of a breach, correct? 19 A There was no document with a breach, 20 but there are many documents that say that these 21 criteria are absolute requirements and Apacheta 22 coming back and saying they do not have the 23 ability to do this. 24 Q Identify for me a particular document 25 that has that kind of communications. Page 149 1 A There was an e-mail in September from 2 Mike Moore to Cora saying we absolutely have to 3 have an Active Directory Sync and 4 authentication. 5 Q Anything else? 6 A There was another document, another 7 e-mail from Barnes around the ability to send 8 stops to different drivers, because it happens 9 all day long. We have to have that capability. 10 There were several things brought up in the 11 meetings. 12 Q Were both of those things actually 13 within the scope of the project? 14 A Yes. 15 Q You're not able right now to identify 16 for me the particular communications? 17 MR. LIPMAN: Objection. She just 18 identified them for you. What do you want? 19 BY MR. STAR: 20 Q Are you able to identify for me those 21 communications; when they were sent, who they 22 were sent by, who they were received by? 23 A If I can pull the e-mails out. 24 Q Did you bring anything with you today? 25 A No. 38 (Pages 146 - 149) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 39 of 68 Page 150 1 Q Other than those things you described, 2 are there other complaints or issues that 3 Lincare raised with Apacheta? 4 A Yes. During the spec reviews that 5 went back and forth for a long period of time, 6 there were a number of issues that were brought 7 up in those documents. 8 Q What time period specifically are you 9 referring to? 10 A Between the kickoff meeting of January 11 through the termination. 12 Q We'll get into the specs in a moment. 13 So I want to understand, though, we've now gone 14 through the language at section 5.2 on page 3 15 about termination for breach and agreed that 16 that language is clear. 17 I'm just trying to understand 18 Lincare's position in this case. Is it 19 Lincare's position that it was permitted to 20 terminate this agreement even if Apacheta was 21 not actually in breach? 22 A Ask the question again. 23 Q Is it Lincare's position in this case 24 that it was permitted to terminate this contract 25 even if Apacheta was not in breach? Page 151 1 A We believe they were in breach. 2 Q But you never notified Apacheta that 3 it was actually in breach? 4 A Not with the words breach. 5 Q And you never sent them a notice that 6 specified the particular breach that you think 7 had occurred? 8 A When we responded to the acceptance 9 criteria on November 20th, we said we do not 10 accept this and there are many issues and these 11 are some of the issues. 12 Q Other than that communication with 13 regard to the November 20th acceptance criteria, 14 is there anything else, any other written 15 communication by which you claim you specified 16 an actual breach? 17 A Like I said, the words breach were not 18 in the e-mails but they were absolute 19 requirements that Apacheta could not meet. 20 (Exhibit 18 marked for 21 identification.) 22 BY MR. STAR: 23 Q What I've marked here as Exhibit 18 is 24 a chain of e-mails. They're Bates labeled 25 Apacheta 13735 and 36. And if you look at the Page 152 1 first e-mail in the chain, it's Cora Forgeng to 2 Rob Batezel and Barnes Marshall and others 3 attaching acceptance criteria and a project 4 plan, right? 5 A Correct. 6 Q So this is what you've been referring 7 to as the acceptance criteria that we received 8 on November 20th? 9 A Correct. 10 Q The next e-mail in that chain is Rob 11 Batezel forwarding you the acceptance criteria 12 on November 20th at 8:10 p.m., right? 13 A Correct, because I was not copied on 14 this. 15 Q So you got them at 8:10 p.m. on 16 November 20th, a Friday, right? 17 A Yes. 18 Q The third e-mail in the chain, which 19 is at the bottom of the page, is you writing to 20 Cora on December 3, 2015? 21 A Yes. 22 Q You write, "Subject, not accepted, 23 Apacheta acceptance criteria - Lincare 24 implementation and project plan." 25 So this is what you're referring to as Page 153 1 your notice to Apacheta, that Lincare is 2 rejecting the acceptance criteria and project 3 plan? 4 A Correct. 5 Q You began by saying, "Lincare 6 acknowledges receipt of your e-mail message with 7 attachments to Rob Batezel of November 20th," 8 right? 9 A Yes. 10 Q How much time did you personally 11 spend, if any, reviewing what Ms. Forgeng sent 12 on November 20th? 13 A A few hours. 14 Q When did you do that? 15 A Probably the following day. 16 Q You say some other things here. I'm 17 focused, though, on the last sentence of your 18 e-mail to Ms. Forgeng. 19 "While Lincare does not agree that the 20 criteria presented in your e-mail are 21 acceptable, we look forward to having a 22 substantive discussion on the matter," right? 23 A Yes. 24 Q You can agree with me that nowhere 25 within this e-mail, of course, did you say that 39 (Pages 150 - 153) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 40 of 68 Page 154 1 Apacheta was in breach? 2 A Like I said, there was no e-mail that 3 said they were in breach. 4 Q Nowhere in this e-mail did you 5 specifically identify any shortcomings or 6 defects or any other particular issue with 7 either the acceptance criteria or the project 8 plan that Ms. Forgeng had sent back on November 9 20, 2015? 10 A I believe my second paragraph does 11 state that. "To include availability of aspects 12 of a product previously identified, e.g., 13 patient portal, directory integration, single 14 sign-on, dynamic electronic forms mapping, 15 inventory and tracking, scalability and route 16 optimization." 17 Q You believe that those were criteria 18 that needed to be in the acceptance criteria? 19 A Correct. And capabilities Lincare 20 requires. 21 Q Go back for me to the contract. And 22 tell me if you can whether each of those items 23 that you identify in that paragraph are actually 24 stated to be within the scope of the project. 25 A On which page? Page 155 1 Q Well, we looked at this earlier, 2 right? The project scope is on Exhibit C to the 3 contract on page 13. 4 A So the patient portal is around the 5 proof of delivery/signature capture and 6 electronic forms capability. 7 Q Where are you? 8 A So halfway down the items listed out, 9 proof of delivery/signature capture is the 10 ability for the patient to securely see those 11 documents. These are high-level groups. And 12 also, electronic forms. Directory integration 13 is around security, in general. So the whole 14 platform has to HIPAA compliant. 15 Single sign-on is related to directory 16 integration. Dynamic electronic forms is under 17 electronic forms. Mapping, inventory is not 18 stated in the statement of work. Scalability is 19 not explicitly, but, again, software has to be 20 scaleable to our needs. And then route 21 optimization is covered under the -- it falls 22 into a lot of these areas. The whole routing is 23 pre-trip. Load management, trip/stop 24 management, pick-up, delivery and exchanges, you 25 know, all of those are route optimization. Page 156 1 Q Now, you sent this e-mail back to Cora 2 on December 3rd. As I understand your testimony 3 now, tell me if I'm wrong, you believe that what 4 you wrote here in this second paragraph 5 specifies the things that you thought were 6 missing from the acceptance criteria? 7 A From the acceptance criteria and the 8 requirements that we needed. 9 Q If they were missing from the 10 acceptance criteria, did you or anybody else 11 from Lincare do anything to, for example, create 12 a redline of the acceptance criteria or create 13 another version of the acceptance criteria or 14 add to what Ms. Forgeng sent in any way? 15 A Not at this point. The major 16 requirements, which were core, they had already 17 said they could not do. That's why they're not 18 in the acceptance criteria, but that doesn't 19 change our stance that they're required. 20 Q What do you mean core? 21 A Core meaning active directory 22 integration, security, secure forms. They had 23 already responded that they can't do these 24 things that we say are core requirements. 25 Q My question is a little bit different Page 157 1 and I think you gave me the answer, but let's 2 get it clear. You never actually provided a 3 redline of the acceptance criteria? You didn't 4 do anything to -- 5 A No. We did not. 6 Q At any time did anybody at Lincare 7 ever draft any acceptance criteria? 8 A No. 9 Q So the only acceptance criteria that 10 you were working from was what Ms. Forgeng sent 11 on November 20th? 12 A Correct. 13 Q Let's go back to Exhibit 2, which is 14 the contract for me. If you go to section 3, 15 it's on page 15. It's part of the statement of 16 work. Section 3 is headed customer 17 responsibilities. 18 Do you see that? 19 A I'm sorry, you're saying section 3 on 20 page. . . 21 Q Page 15, section 3, customer 22 responsibilities. 23 A Okay. 24 Q Are you familiar with this section? 25 A Yes. 40 (Pages 154 - 157) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 41 of 68 Page 158 1 Q And under customer responsibilities, 2 that's, of course, referring to Lincare's 3 responsibilities, right? 4 A Yes. 5 Q "Customer, Lincare, shall perform its 6 responsibilities described in this section in a 7 timely and businesslike manner, hereinafter 8 customer responsibilities," right? 9 A Yes. 10 Q So Lincare, we can agree, was 11 obligated to perform the responsibilities that 12 are set forth right here in section 3 in a 13 timely and businesslike manner? 14 A Yes. 15 Q Look at 3.2. "Customer, Lincare, 16 shall work with Apacheta to develop the 17 acceptance criteria documents." 18 That never happened, right? 19 A Well, at that point, just what 20 Apacheta sent, again, was based on what they 21 could do, not on what we needed. So at this 22 point in time, this solution is not going to 23 work for us. 24 Q Just so I'm clear, at no point in time 25 did Lincare ever do anything to work with Page 159 1 Apacheta to develop the acceptance criteria 2 documents? True? 3 A Not at this point, because, again -- 4 Q Not at what point? 5 A At the point that the acceptance 6 criteria was sent, the decision was they had 7 already responded that they could not meet core 8 requirements, which would put us in HIPAA 9 breach, too much risk. I understand what you're 10 saying. I'm just answering you, at this 11 point -- 12 Q You're giving me a reason. I'm just 13 asking you for a fact. 14 A At this point, we did not respond back 15 to the acceptance other than that we do not 16 accept. 17 Q In fact, you say at this point, and I 18 think you're referring to the time around 19 November 20th and after. 20 Just so we're clear, at no point ever 21 during the entire time year of this contract did 22 Lincare do anything to work with Apacheta at all 23 to develop acceptance criteria, correct? 24 A No. The terminology of acceptance, 25 but the business requirements is the initial Page 160 1 phase of acceptance. 2 Q What did in your view Lincare actually 3 do to work with Apacheta to develop any 4 acceptance criteria documents? 5 A Because the acceptance criteria is 6 based on the business requirements. And we 7 worked on the business requirements with 8 Apacheta back and forth for months and months. 9 That is the basis and the beginning of 10 the acceptance criteria. I don't think that's a 11 fair statement. 12 Q Is there any document that you're 13 aware of where Lincare ever wrote down what its 14 acceptance criteria would be? 15 A On the business requirements, there 16 were quite a number of them. 17 Q You're telling me that you wrote down 18 your business requirements and they get 19 documented in the functional specification, 20 correct? 21 A As well as all of our issues were 22 documented. 23 Q The editorialization is tough to 24 follow, because we're trying to stick with the 25 facts. Page 161 1 The business requirements are written 2 down in the function spec, right? 3 A Yes. 4 Q That's the goal? 5 A That's the goal. 6 Q The acceptance criteria is a separate 7 document? 8 A Correct. 9 Q The only acceptance criteria document 10 that anybody on this project created was the one 11 that Cora Forgeng sent on November 20th of 2015? 12 A Correct. 13 Q And Lincare never created its own 14 version or modified or suggested changes -- 15 A Not a document called acceptance 16 criteria. 17 Q Thank you. 18 MR. STAR: This is Exhibit 19. 19 (Exhibit 19 marked for 20 identification.) 21 BY MR. STAR: 22 Q There's different ways we can handle 23 what we've marked here as Exhibit 19. We'll try 24 to do it the easiest way. 25 First off, this is a big chunk of 41 (Pages 158 - 161) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 42 of 68 Page 162 1 documents Bates labeled Apacheta 12280 through 2 12576. The first being a cover e-mail from Cora 3 Forgeng to Rob Batezel and others at Lincare 4 attaching three different functional 5 specifications. 6 Do you see that? 7 A Yes. 8 Q We've mentioned a number times that 9 functional specs were deliver on November 5, 10 2015. 11 I'm not going to ask you to review 12 these page by page. I will represent to you, 13 and if it turns out that you guys think 14 otherwise later, these documents that we've 15 attached here and are sequentially Bates labeled 16 off of this e-mail, are what was produced as 17 being attachments to Ms. Forgeng's October 5, 18 2015 e-mail. Okay? 19 Have you reviewed or at any time have 20 you reviewed those actual functional 21 specifications that Ms. Forgeng -- 22 A At a high-level, I reviewed the 23 functional specs. 24 Q When do you first recall reviewing the 25 functional specs? Page 163 1 A I first got here on 10/1. So it was 2 sometime after 10/5 when they were sent. I 3 can't tell you the specific date. 4 Q How much time did you personally spend 5 reviewing these functional specs? 6 A I can't remember. 7 Q Were there internal meetings to review 8 these specs? 9 A Yes. 10 Q Were you part of those? 11 A Not all of them, no, but there were a 12 couple I attended. 13 Q And who were the other attendees at 14 those meets to review those specs? 15 A The project team, which would be 16 Barnes and Craig. I think a couple of the 17 developers were involved. 18 Q When you joined Lincare and you became 19 involved to some degree in the project in 20 October of 2015, you're aware that there had 21 been weekly project meetings between Apacheta 22 and Lincare? 23 A Yes. 24 Q Those were every Friday. 25 A Yes. Page 164 1 MR. STAR: Let's mark this as Exhibit 2 20. 3 (Exhibit 20 marked for 4 identification.) 5 BY MR. STAR: 6 Q What's marked here as Exhibit 20 is a 7 chain of e-mails that deal with the weekly 8 status meetings. 9 These run from, the earliest meeting 10 here being October 9th of 2015 with the latest 11 being December 11, 2015. 12 Are you familiar with these sorts of 13 weekly status meeting notes? 14 A Yes. 15 Q We saw on Exhibit 19 that Cora sends 16 functional specs on October 5th, right? 17 A Yes. 18 Q So go to the last page in Exhibit 20, 19 which is Bates labeled Apacheta 13757 and let's 20 look at the first e-mail in the chain. Okay? 21 A Yes. 22 Q And that's from Cora to Rob and Barnes 23 on October 9th. Do you see that? 24 A Yes. 25 Q So this would have been the first Page 165 1 Friday meeting after Cora sends the specs on 2 October 5th, right? 3 A Yes. 4 Q So the attendees are Barnes, Rob and 5 Cora. And action items below, in the notes it 6 says, "On Tuesday, October 5, 2015, final 7 functional specifications were sent for Lincare 8 approval." 9 Do you see that? 10 A Yes. 11 Q Help me to understand. What was the 12 purpose of the weekly status meeting notes? 13 A To go through the functional 14 requirements. 15 Q Okay. More generally, these Friday 16 meetings were happening, right? 17 A Yes. 18 Q And it looks from what I can tell that 19 Cora would be the one who would send out notes 20 of what occurred during the meeting after it 21 happened? Is that generally how it happened? 22 A Yes. 23 Q And if Cora had misinterpreted or not 24 understood really what happened, Barnes or Rob 25 could have said to her, hey, we don't agree, 42 (Pages 162 - 165) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 43 of 68 Page 166 1 right? 2 A Yes. 3 Q So if notes are written down here, we 4 can take that to mean that both parties agreed 5 that those notes were a correct reflection of 6 what happened during the meeting? 7 A I mean, I can't say that any of our 8 folks would go back and correct it. This was 9 Cora's interpretation of the meeting. 10 Q But we can see nobody did go back and 11 correct it. I understand your caveat. In any 12 event, she writes that the final functional 13 specs were sent for Lincare approval. 14 You've talked with Barnes and Rob 15 about this project. Tell me, in their view, 16 were they also under the belief that these 17 versions that were sent on October 5th were 18 going to be the final version of the functional 19 specifications? 20 MR. LIPMAN: Objection. It was 21 unclear. You said also. The word also was 22 the problem. 23 A So in my meeting with them, they 24 continued to stress that Apacheta only documents 25 what they feel that they can provide. They will Page 167 1 not document in the specifications the things 2 that we need. 3 So that was one of my first days 4 there. I believe I sat in on this meeting here. 5 That's why Cora is asking for Linda's contact 6 information. 7 BY MR. STAR: 8 Q Okay. So as I understand what you're 9 saying is that it might not have been Apacheta's 10 view that these were final, but from Lincare's 11 perspective, that perhaps was not the case? 12 A It was not inclusive of all of the 13 items that we said that we need in the 14 application. It was only the things that we 15 agreed could be done, not the things that could 16 not be done. 17 Q The second bullet says, "Barnes is 18 reviewing the documents and anticipates 19 completing sometime next week." 20 Was that true? 21 A I'm sure they felt like it was at the 22 time, but that could not happen because there 23 was just so many issues in the review. 24 Q You've alluded to that many, many 25 times, that there were issues in the review. Page 168 1 Part of the challenge that we all face here is 2 that when I ask you to identify a document, 3 certainly you don't have them in front of you, 4 but let's try to come at it this way. 5 Is there any written analysis or 6 report or summary or anything like that that 7 Lincare produced which analyzed the functional 8 specifications that Cora sent on September 5th? 9 MR. LIPMAN: Objection to the word 10 produced. Do you mean produced in the 11 litigation? 12 MR. STAR: No. I mean that they made. 13 A There were e-mails that went back and 14 forth around issues. 15 BY MR. STAR: 16 Q You're saying internal e-mails or 17 e-mails to Apacheta? 18 A To Apacheta. 19 Q Now, I know you've identified -- it 20 gets a little big confusing, because obviously 21 there were various versions of the functional 22 specs. 23 In fact, if you go back and look at 24 Exhibit 19, the attachments, the first one says 25 it's version seven of the functional requirement Page 169 1 for TransportAce? 2 A Yes. 3 Q And similarly, with the other 4 functional specs, there's a version four and 5 there's a version five, right? 6 A Okay. 7 Q So it gets a little confusing, because 8 clearly, there would have been some back and 9 forth over a period of time with different 10 versions making changes to get to what Cora sent 11 on October 5th? 12 A Yes. 13 Q Limiting ourselves to on or after 14 October 5th, what back and forth, if any, is 15 there between Lincare on the one hand and 16 Apacheta on the other where Lincare is telling 17 Apacheta that the functional specifications 18 don't meet Lincare's needs? 19 A I didn't see anything until the 20 acceptance criteria. At that point, Lincare was 21 assessing the situation. There had been a lot 22 of people talking about the issues of this 23 project and the lack of capability. 24 That had started before I came. And 25 it's obvious in some e-mails, like with Mike 43 (Pages 166 - 169) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 44 of 68 Page 170 1 Moore's e-mail, the inability to do Active 2 Directory and authentication. 3 So there was already discussions that 4 had started before I came around Apacheta's 5 inability to really meet our needs. 6 Q So for purposes of my question, from 7 October 5th through at least November 20th, 8 there's no communication at all from Lincare to 9 Apacheta telling Apacheta that there's anything 10 missing or wrong with the functional 11 specifications that Cora delivered on 12 October 5th. 13 A I didn't see any e-mails. 14 Q If we go back to the weekly status 15 meeting notes that are Exhibit 20 and we go to 16 the next e-mail, which is October 16th, the 17 notes of that meeting are that Barnes was out 18 sick most of this week and, therefore, was not 19 able to complete his review of the documents. 20 Barnes will continue to reviewing documents and 21 will submit feedback to Cora by October 23, 22 2015. 23 That never happened, did it? 24 A No. 25 Q And during these meetings, neither Page 171 1 Barnes nor Rob nor yourself to the extent you 2 were involved ever identified any particular 3 issues, complaints, missing items, et cetera, 4 from the functional specifications? 5 A Not from this version of the 6 functional specifications. Again, this is only 7 Apacheta saying what they can do and nothing 8 about what they can't do. 9 Q I understand your caveat. Believe me, 10 it's there. You have said it many times. I'm 11 only interested in what was actually 12 communicated back on and after October 5th. 13 Okay? 14 A Okay. 15 Q If we go to the next meeting, which is 16 October 23rd. That's Cora again summarizing the 17 meeting. 18 She again says, "On Tuesday, 19 October 5, 2015, final functional specifications 20 were sent for Lincare approval," right? 21 A Yes. 22 Q This is now the third time she's 23 referred to these as final specifications. And 24 her second bullet says, "Barnes is continuing to 25 review the documents. He was unable to complete Page 172 1 this week as he was redirected on to another 2 internal task." 3 Do you see that? 4 A Yes. 5 Q So at this point, exactly 18 days have 6 passed since -- exactly 18 days have passed 7 since the October 5th e-mail from Cora attaching 8 the functional specs, right? 9 A Yes. 10 Q And Lincare had those documents for 11 18 days, but hadn't completed its review? 12 A Correct. 13 Q Nor had you officially told Apacheta 14 that you were rejecting those functional 15 specifications, right? 16 A Correct. 17 Q This continues. If we go to the 18 fourth e-mail in the chain, that's October 30, 19 2015. Actually now, the weekly status meetings 20 start to get canceled, right? Do you see there 21 under the notes, having nothing new to report. 22 Lincare canceled the meeting. 23 A Yes. 24 Q Why did Lincare cancel the meeting? 25 A Like I said, we were in discussions on Page 173 1 what to do about the issues and how this is not 2 going to perform for Lincare. 3 Q And as of October 30th of 2015, you're 4 25 days into having had the October 5th 5 specifications, correct? 6 A Yes. 7 Q But no rejection officially at that 8 point? 9 A Correct. 10 Q No reasons for rejection given 11 officially at that point? 12 A Correct. 13 Q And we see this again continues with 14 the e-mail of November 6, 2015 and the status 15 meeting of that date, right? 16 A Yes. 17 Q That status meeting is also canceled? 18 A Yes. 19 Q And that's 32 days after receipt of 20 the functional specs? 21 A Correct. 22 Q And still as of 32 days, no official 23 rejection and no reasons given? 24 A Correct. 25 Q And if we go to the next e-mail, 44 (Pages 170 - 173) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 45 of 68 Page 174 1 that's November 12, 2015 -- pardon me, dealing 2 with the November 13, 2015 weekly status, right? 3 A Yes. 4 Q Again, this actually says, "Barnes 5 reported that he did not have any updates to 6 provide. The meeting was canceled upon 7 Lincare's request. Status from last week 8 remains. See below for detail." 9 Do you see that? 10 A Yes. 11 Q So you're now 39 days into having 12 received the functional specs on October 5th, 13 correct? 14 A Correct. 15 Q Still no rejection? 16 A No rejection. 17 Q And no reasons or complaints were 18 actually given with regard to those October 5th 19 specs? 20 A Correct. 21 Q Let's go to the next e-mail, December 22 4, 2015. "Barnes reported that he did not have 23 any updates to provide. The meeting was 24 canceled upon Lincare's request," right? 25 A Yes. Page 175 1 Q We're now 46 days into having received 2 the functional specs on October 5th? 3 A Yes. 4 Q And still no rejection, still no 5 reasons given for not accepting? 6 A Correct. 7 Q And the same thing is true on the last 8 weekly status meeting report given here for 9 December 11, 2015? 10 A Well, that's definitely a different 11 note. 12 Q It's a different note. So let's read 13 it. It says, "On December 4, 2015, Apacheta 14 received an e-mail from Linda Reid indicating 15 that Lincare does not accept the acceptance 16 criteria and project plan," right? 17 A Yes. 18 Q But there was no mention here or in 19 your e-mail of December 4th, which we looked at 20 a little while ago of any rejection of the 21 October 5, 2015 functional specs? 22 A Correct. 23 Q At any time to your knowledge was 24 there a written communication to Apacheta from 25 Lincare on or after October 5, 2015 formally Page 176 1 rejecting the October 5th functional 2 specifications and/or specifying reasons why 3 those specifications were rejected? 4 A There were meetings between Gregg 5 Timmons and Greg McCarthy during this period to 6 try to have a conversation to express concerns 7 and that this is not going to work for Lincare. 8 I am not privy to how they connected, 9 but that was the intent of this was for them to, 10 you know, CEO to COO have a conversation. 11 Q Other than those conversations -- 12 let's just be clear. You weren't part of those 13 conversations? 14 A No, I was not. 15 Q In preparing for today's deposition, 16 did you go back and speak with Mr. McCarthy and 17 find out what he discussed with Mr. Timmons? 18 A No. 19 Q So you're not aware of actually what 20 was discussed during those calls? 21 A No. 22 Q So going back to my question. You're 23 not aware of any written communication from 24 Lincare to Apacheta on or after October 5, 2015 25 either formally rejecting the functional Page 177 1 specifications or providing a specific reason 2 why the specifications were deficient or 3 insufficient in any way? 4 A No, not from a specification. I did 5 see an e-mail from Greg McCarthy think to Gregg 6 Timmons around concerns and issues. I can't 7 tell you the exact date, but I do remember 8 reviewing that. 9 Q I think I know what you're referring 10 to so let's take a look. Before I do that, let 11 me ask you about an earlier e-mail that you 12 sent. 13 MR. STAR: This will be Exhibit 21, 14 please. 15 (Exhibit 21 marked for 16 identification.) 17 BY MR. STAR: 18 Q Exhibit 21 is an e-mail chain, bates 19 labeled Lincare 9702 through 9705. Some of the 20 e-mails in the chain are old e-mails that we've 21 seen today. 22 I'm more interested in the last e-mail 23 at the top that you write. It's October 8, 24 2015. 25 MR. LIPMAN: You mean the first 45 (Pages 174 - 177) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 46 of 68 Page 178 1 e-mail. 2 BY MR. STAR: 3 Q So I referred to it as the last. It's 4 the last in the chain that appears at the top of 5 the first page. 6 MR. STAR: Let's go off the record. 7 (Discussion off the record.) 8 MR. STAR: Back on the record. 9 BY MR. STAR: 10 Q So let's look at the e-mail at the top 11 of the first page. It's October 8, 2015. It's 12 you to Greg McCarthy. 13 You write here, "I did not get the 14 impression that we owe them any money at this 15 time, because they have not produced a detailed 16 requirements document with deliverables that we 17 will have to review and either accept or reject 18 based on what Mike/Rob has explained to me and 19 how the contract reads." 20 I'm interested in your understanding 21 of -- first off, what were you referring to as 22 the detailed requirements document? 23 A With the deliverables, that would be 24 the SOW with the acceptance criteria, which is 25 your deliverables. The specification document Page 179 1 is just I'm going to change the screen. We have 2 to have a document with deliverables. 3 Q So let me get your understanding and 4 you tell me if it's also the company's 5 understanding. 6 Is it your view Lincare had no actual 7 obligation to review and either reject or 8 approve the functional specifications that Cora 9 sent on October 5, 2015? 10 A Is it our view that we had no 11 obligation? 12 Q Yes. 13 A No. That's not our view. 14 Q So we can agree that Lincare was 15 obligated to review and either reject or approve 16 the specs that Cora sent on October 5th? 17 A Yes. 18 Q So when you wrote this e-mail on 19 October 8, 2015, at that point in time, are you 20 aware that Cora had sent the October 5th 21 specifications? 22 A Right. 23 Q And based on what we saw in the weekly 24 status notes, Lincare is communicating to 25 Apacheta that Lincare is actually engaged in Page 180 1 reviewing those specs? 2 A Correct. 3 Q And that was something that you've now 4 told us you believe Lincare needed to do? 5 A At some point if we weren't going to 6 accept. If we were going to accept, yes, but at 7 this point there was already too many red flags 8 on this. 9 So when it says requirement documents 10 with deliverables, that's not this specification 11 document. That's what's written in the contract 12 as an acceptance criteria project plan and an 13 SOW. It doesn't specifically say it, but the 14 deliverables is what it says in the contract. 15 Q So let's go back and look at 16 Exhibit 19. And I'm just going to refer to the 17 Bates labeled pages at the bottom. 18 So if you flip to the second page, 19 it's labeled Apacheta 12281. It's says it's the 20 TransportAce For Home Health Lincare Functional 21 Specification - Android Operating System Tablet. 22 Do you see that? 23 A Yes. 24 Q And if you flip to the next page, 25 which is 12282, it has a revision history? Page 181 1 A Yes. 2 Q So this shows the history of the 3 various versions of this document? 4 A Yes. 5 Q Beginning in July of 2015 all the way 6 up to October 5th, right? 7 A Yes. 8 Q And it tells the reader what changes 9 have been made? 10 A Correct. 11 Q And if we go to the table contents at 12 page 12284, item 1.1 is document purpose. And 13 that's found on page 8 of the actual spec. 14 A Okay. 15 Q So if you go to that page 8, which is 16 Bates labeled Apacheta 12289, we see it does 17 indeed say document purpose. 18 A 12289? 19 Q Yes. The functional specification 20 document seeks to capture all aspects of the 21 agreed upon implementation of the defined 22 application deliverable, right? 23 A Yes. 24 Q The second paragraph there goes on to 25 say, "It shall serve to document in detail the 46 (Pages 178 - 181) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 47 of 68 Page 182 1 agreed upon client deliverables captured in the 2 contract statement of work and as the basis for 3 the acceptance criteria for the mobile 4 applicable deliverable, right? 5 A Yes. 6 Q So help me to understand your view. 7 You think there was going to be something other 8 than this, like a separate additional statement 9 of work other than the functional 10 specifications? 11 A Yes. 12 Q Was that ever prepared? 13 A No. 14 Q In what form would that be? 15 A It's called a statement of work, 16 acceptance criteria that has deliverables, 17 dates, responsibilities, open items. 18 This is a functional spec. Like can 19 you see, it gets into we're going to change this 20 one screen, we're going to add this, we're going 21 to add that. 22 That's not the statement of work -- I 23 mean, we would have to go through hundreds of 24 pages. A statement of work is individual 25 deliverables with their responsible party and Page 183 1 delivery dates and the acceptance criteria for 2 that. 3 Q But as I understood the dates and -- 4 strike that. As we talked about earlier, the 5 way in which the parties were going to document 6 the dates of completion for specific tasks and 7 who was responsible for them was going to be in 8 a separate project plan. 9 A There is a project plan attached to 10 the statement of work, right. It's kind of a 11 three-part document. 12 So statement of work is those 13 deliverables, you know, it's more in a Word 14 format, if you will, who is responsible, what 15 are the delivery dates, any issues within the 16 deliverables. 17 You're going to have your project 18 plan, which is a more detailed plan by resource 19 in the acceptance criteria. 20 Q And we've seen that the acceptance 21 criteria itself is a separate document you got 22 on November 20th, along with the project plan? 23 A Yes, but it was not complete. 24 Q I understand that that's your view. 25 You've said it enough. It's there. Go back to Page 184 1 the table of contents, which is 12284 and item 3 2 is statement of work. That's within the 3 functional spec itself, right? 4 A On the table of contents? 5 Q Yes. 6 A Yes. 7 Q And if you go to page 10, in fact, you 8 see under heading number 3, it's called 9 statement of work? 10 A That's just a reiteration of the 11 initial. That's not the true deliverables after 12 all the specification phase. All this is, is 13 showing what the original statement of work was. 14 Q So in your view, this document -- help 15 me understand. What would this document be used 16 for? If Lincare actually approved these three 17 functional specifications, what would happen 18 next? 19 A Then we would move to the next wave of 20 functional requirements. 21 Q Which would be what? 22 A There was no discussion yet around, 23 like I said, the tablet and around the 24 interfaces. You can see, that's not even 25 covered in here. Page 185 1 This was a piece of the project, which 2 is really just screen changes. There's a lot 3 more to the project to make it happen than just 4 these screen changes. 5 So there was still work to be done 6 that are not included in these functional 7 requirements. 8 Q And I understand that that is your 9 view, but we can agree that and you've said 10 this, that Lincare was obligated to review these 11 functional specs and either approve or reject 12 them, right? 13 A Yes. 14 Q So you were mentioning -- I was asking 15 you a little while ago about communications that 16 might have been had between anybody at Lincare 17 and Apacheta where there were issues with the 18 functional specifications had been raised, and 19 you mentioned that there might have been 20 conversations between McCarthy and Timmons, 21 right? 22 A Yes. 23 Q And then you mentioned you thought you 24 saw this in an e-mail. Let's take a look at 25 this one, which is Exhibit 22. 47 (Pages 182 - 185) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 48 of 68 Page 186 1 (Exhibit 22 marked for 2 identification.) 3 BY MR. STAR: 4 Q So this is a document Bates labeled 5 Apacheta 14393 through 14399. It begins with an 6 e-mail dated August 31, 2015. 7 Some of these e-mails we've seen in 8 other attachments. What happens is they get 9 forwarded in different spots and different 10 people respond and so on. 11 I'm most interested in the e-mail on 12 the first page in the middle of November 16, 13 2015 from Greg McCarthy to Gregg Timmons. 14 There's some discussion about not 15 getting back to each other sooner for a 16 discussion. In the middle paragraph McCarthy 17 writes, "That said and in anticipation of a 18 call, can you send me a copy of the project 19 specifications that," and there's a typo here, 20 "that you have less submitted to us. 21 I have not seen a copy, so I have not 22 yet reviewed what was proposed and frankly would 23 need to sit down with the rest of the executive 24 team, as well as Linda to determine if it meets 25 our needs." Page 187 1 Is that what you were recalling as the 2 e-mail between McCarthy and Timmons where the 3 specifications were discussed? 4 A This is one of them, yes. 5 Q And you would agree that as of 6 November 16th, Mr. McCarthy hadn't even seen a 7 copy of the project specs? 8 A We hadn't received them yet. 9 Q He's asking for what Cora had sent on 10 October 5th, right? 11 A He doesn't say that. The project 12 specifications that you have last submitted to 13 us. 14 Q Well, let's look at the preceding 15 e-mail from Gregg Timmons to Greg McCarthy on 16 November 2nd. It goes on to the second page of 17 this document. And if you look at the middle 18 paragraph there beginning, "As you are most 19 likely aware." 20 Do you see that? 21 A Yes. 22 Q Look at the last sentence there. "We 23 have been working through these various reviews 24 with your team and together have landed on a 25 project specification that was submitted for Page 188 1 final approval in early October of 2015." 2 So Timmons calls it a project spec. 3 Obviously -- 4 A Everybody has got different names. 5 Q But clearly when McCarthy writes back, 6 he's not seen the project specs yet or the 7 functional specs at this point, right? 8 A Correct. 9 Q At that point in time, had Mr. 10 McCarthy discussed with you whether those 11 functional specs met Lincare's needs? 12 A Yes. 13 Q And what was determined? 14 A Like I said, there were already 15 discussions around some of the big gaps in areas 16 that Apacheta could not meet our needs prior to 17 this. 18 Q So as of the time that McCarthy writes 19 to Timmons on November 16th, your testimony is 20 that you had already identified to McCarthy 21 particular gaps in the functional specifications 22 that wouldn't meet Lincare needs? 23 A Yes. I believe I had done my summary. 24 Q Yet, even in this e-mail from McCarthy 25 to Timmons, McCarthy does not point out any Page 189 1 particular gaps or deficiencies in the 2 functional specs? 3 A Correct. 4 MR. LIPMAN: Can we take a 5 three-minute break? 6 MR. STAR: Sure. 7 (A short recess was taken.) 8 BY MR. STAR: 9 Q You can move those functional specs 10 away. Exhibit 21, there's an e-mail in the 11 middle of the first page from Greg McCarthy to 12 you on October 7, 2015. 13 And part of what McCarthy writes reads 14 this, "We are in no position just yet to decline 15 his payment until you have evaluated (that is 16 our story - I know what your answer is.)" 17 Do you know what McCarthy is talking 18 about here? 19 A I really don't know. I don't know 20 what he was thinking." We are in no position 21 just yet to decline his payment until you have 22 evaluated." I was reading it out loud. I'm not 23 sure exactly what he meant. 24 Q Do you recall discussing with Mr. 25 McCarthy why he felt Lincare was not yet in a 48 (Pages 186 - 189) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 49 of 68 Page 190 1 position to decline Apacheta's request for 2 payment? 3 A At that point, there was an invoice 4 outstanding. No. There was an addendum that 5 Greg from Apacheta sent wanting to change the 6 payment terms that was being serviced to our 7 Greg at Lincare wanting to change payment terms 8 and they wanted $250,000 now instead of after we 9 do or do not accept. 10 Q You don't recall why Mr. McCarthy felt 11 that as of October 7, 2015 Lincare was not yet 12 in a position to decline Apacheta's request for 13 payment? 14 A No. I believe it was around the 15 payment terms being changed if you look at the 16 e-mail before that. 17 Q He writes, "That is our story. I know 18 what your answer is." Any idea what he meant by 19 that is our story? We'll have to ask him. 20 MR. STAR: Let's go through some more 21 documents here. I'll try to move through 22 these quickly. This will be 23. 23 (Exhibit 23 marked for 24 identification.) 25 BY MR. STAR: Page 191 1 Q So Exhibit 23 is document Lincare 2 9706. It's two e-mails from McCarthy to you on 3 October 7th and you back to McCarthy. 4 McCarthy asks in his e-mail, "Linda, 5 have you had the chance to do a review of the 6 Apacheta program and where it stands?" 7 And you write back in the second 8 paragraph, "I am putting a document together 9 with the project summary and risks to send to 10 Kristen by early next week to review with the 11 executive team to discuss next steps." 12 Did you ever prepare that project 13 summary? 14 A Yes. 15 Q And in what format did you do; a Word 16 document, Excel spreadsheet; do you know? 17 A I believe it was a Word document. 18 Q Is that something that you then 19 e-mailed around to folks? 20 A We reviewed it at an executive 21 meeting. 22 Q My questions is -- I don't think we've 23 seen it. 24 MR. LIPMAN: I believe that was an 25 attachment to e-mails that only involved Page 192 1 legal, that legal was involved at that 2 point and therefore it was withheld or 3 redacted. I believe it was one of those 4 two. 5 BY MR. STAR: 6 Q Let me ask you some questions about 7 it. Mr. McCarthy is asking you to do this 8 project summary, right? 9 A The concerns were already surfaced to 10 the executive team before I came. 11 Q My question is different. You write 12 here in your e-mail, "I am putting a document 13 together with a project summary," right? 14 A Yes. 15 Q Was that your idea to put together the 16 document with the project summary? 17 A No. I was asked to do that in I think 18 an executive meeting or in one of our review 19 meetings. 20 Q By whom were you asked to put together 21 the summary? 22 A The executive team. 23 Q And who is on the executive team? 24 A Greg McCarthy, CEO, Crispin Teufel. 25 Q Who is Crispin Teufel? Page 193 1 A Crispin Teufel is our CFO and Kristen 2 Hoefer who is our CEO. 3 Q So the COO, the CFO and the CEO asked 4 you during an executive meeting to put together 5 a summary of the Apacheta project? 6 A Yes. 7 MR. STAR: Fine. I think that needs 8 to be produced. It wasn't something done 9 at the request of counsel. It's not work 10 product. I don't see why we wouldn't get 11 it. 12 MR. LIPMAN: My position would 13 continue to be based upon my understanding 14 of what happened thereafter, because legal 15 was involved and legal then asked for 16 certain things, that the document is 17 privileged. You can ask her those 18 questions. 19 MR. STAR: Which questions? 20 MR. LIPMAN: Well, all that she's told 21 you so far is who made the request, but 22 then it was a fluid process thereafter is 23 my understanding as to what ultimately was 24 produced. And it didn't -- it wasn't just 25 the initial request. It became a larger 49 (Pages 190 - 193) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 50 of 68 Page 194 1 document. If I'm incorrect, I will 2 certainly revisit that issue. 3 BY MR. STAR: 4 Q When did you prepare this so-called 5 summary? 6 A This is on 10/7. So in the early next 7 week, it would have been the following week. I 8 don't think I made it to be quite honest. 9 Q You don't think you made what? 10 A Well, here where I'm saying by early 11 next week, I don't believe I got it done in the 12 next week. So I would just probably say 13 somewhere around mid-Octoberish time frame. 14 Q And between your e-mail on October 7th 15 and your completion of the project summary, did 16 anybody else ask you to prepare that document or 17 to prepare anything in connection with that 18 document? 19 A No. 20 Q So the document -- the project summary 21 that you prepared and completed somewhere around 22 the middle of October of 2015 was a document you 23 were asked to prepare by this CFO, COO and the 24 CEO? 25 A Yes. Page 195 1 MR. LIPMAN: Based upon what you're 2 saying, I'm not sure I have seen the 3 document because I don't know that it would 4 have been captured necessarily by our 5 search. 6 So here's what we're going to do. I 7 will determine what this document is. 8 Obviously, if we can't locate, that's 9 another issue, but I will determine what 10 this document is. 11 And at that point, we will either 12 produce it or I will provide you an 13 explanation as to why we're not going to 14 produce it. And then at least, if it 15 becomes an issue -- 16 MR. STAR: We'll cross that bridge if 17 we'll need to do it. 18 BY MR. STAR: 19 Q So you were asked during a meeting 20 with these three executives, which obviously 21 would have taken place sometime between 22 October 1st when you started and October 7th 23 when you wrote this e-mail. 24 Do you recall when the meeting was? 25 A I don't. It was very early on. Page 196 1 Q Were there additional meetings while 2 this project was happening and before it was 3 terminated on February 1st that involved you and 4 the executive team of Lincare? 5 A There was the meeting where we 6 reviewed the gaps and issues. 7 Q When was that? 8 A That would have been, again, I don't 9 know the exact date, but that would have been in 10 the later October time frame. 11 Q So there would have been a meeting the 12 first week of October and then a meeting again 13 with the executive team later in October? 14 A Yes. 15 Q At that later October meeting, who 16 attended? 17 A I really can't remember, because their 18 schedules were so terrible. It's hard to get 19 all three of them together. 20 I can't remember exactly who was 21 there, but at least one of the executives were 22 there. I believe two were there. 23 Q Were any of Apacheta's lawyers 24 involved in that meeting? 25 A No. Page 197 1 Q So now you've identified two executive 2 meetings in October. Were there any such 3 meetings in October of 2015 concerning Apacheta? 4 A I don't believe -- not with the 5 executive team. 6 Q Let's stick with executive meetings. 7 What about in December of 2015, any executive 8 meetings concerning Apacheta? 9 A Not specifically, but I reviewed 10 projects in general, every other week with the 11 executives. Apacheta was a large project that 12 would be reviewed on an ongoing basis. 13 Q As part of an executive team meeting? 14 A Yes. 15 Q And during those executive team 16 meetings, was legal counsel involved? 17 A Not during the project review meetings 18 per se. 19 Q So we've gone through December of 20 2015. What about January or February of 2016? 21 Any executive level meetings that you were 22 involved in where Apacheta was discussed? 23 A Like I said, it's project on my 24 project list. So they would have been discussed 25 every other week, basically. 50 (Pages 194 - 197) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 51 of 68 Page 198 1 Q So basically, you've got a twice 2 monthly meeting with the executives beginning 3 your very first week in October of 2015? 4 A Yes. 5 Q When you go to those meetings, do you 6 take a notepad with you? 7 A Yes. 8 Q So you take notes? 9 A Sometimes. Mostly not. 10 Q Is there somebody in those meetings 11 that's designated take minutes or to take notes 12 specifically? 13 A No. 14 Q You go in there and it's the three 15 executives you identified; the CEO, the CFO and 16 COO, right? 17 A Yes. 18 Q What do they bring to the meetings? 19 Do they bring a notepad, a pen? 20 A Sometimes. 21 Q Let's talk about you specifically. 22 Between your first week in October of 2015 and 23 the end of February of 2016, you would have 24 participated in roughly a dozen or more of these 25 executive meetings where Apacheta would have Page 199 1 been part of the discussion? 2 A I wouldn't say Apacheta was discussed 3 in each meeting, but if it came up as a 4 discussion, we would have discussed it. We 5 never get through all of the projects. There's 6 too many. 7 Q But certainly, your recollection is in 8 October of 2015, Apacheta is definitely part of 9 the discussion? 10 A Yes. 11 Q Where are your notes from those 12 meetings? 13 A I doubt if I still have them. 14 Q What's your process? What do you 15 usually do after those meetings with whatever 16 notes you've taken? 17 A Usually I would update the document 18 that we would go over. It's like a project 19 review listing. 20 Q Is that a formal title of that 21 document? 22 A I think it's called a master project 23 tracker. 24 Q Where do you find the master project 25 tracker within Lincare? Page 200 1 A It's on the IT share drive. 2 Q So we've gone and asked for documents 3 to be produced and Matt and I have worked with 4 getting that done for our respective clients. I 5 know sometimes it's not always easy to identify 6 every possible place where documents reside. 7 To your knowledge, did anybody go and 8 check this shared drive for whatever this 9 document is or for anything else about Apacheta? 10 A I didn't see it in the documents we 11 reviewed. 12 Q So you think that they probably didn't 13 check that location? 14 A Probably didn't, but it really is just 15 a listing of the projects and the dates. It 16 wouldn't have any subsequent information on it. 17 Q We'll want to see it nonetheless. 18 A And I'm not even sure, you know, to be 19 quite honest, in October I was so new, when I 20 really produced the formal master tracker 21 document. It probably wasn't until November or 22 December time frame. 23 Q I see. So this master tracker 24 document -- 25 A It didn't exist before me. Page 201 1 Q It's your creation? 2 A Yes. 3 Q And Apacheta is one of the projects 4 that you were tracking? 5 A Yes. One of many. 6 Q If you have retained any handwritten 7 notes that you would have made about Apacheta in 8 any context or during any of these executive 9 meetings that you had twice a month, where would 10 you find those? 11 A If I have -- I usually keep a little 12 portfolio, but usually I go through and I throw 13 that away and then I have my next one. 14 Q I would just ask that you make sure 15 you don't throw anything away now. I'm sure 16 you've been instructed not to do that. 17 A Yes. 18 Q I'll ask Matt to check with you to see 19 if you've got anything like that. 20 A Okay. 21 MR. LIPMAN: Excuse me, my suggestion 22 is Alex is taking good notes. 23 MR. STAR: We'll be back to you. 24 MR. LIPMAN: Yes. Send me an e-mail 25 ,or better yet, a letter, identifying all 51 (Pages 198 - 201) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 52 of 68 Page 202 1 of the things you want us to look for and, 2 we'll certainly see what we can do. 3 BY MR. STAR: 4 Q The executives during these meetings, 5 any one of them a note-taker? 6 A I'm sure they've taken notes here and 7 there. For the most part, it's a very open, 8 casual conversation mostly on presenting 9 whatever document I have to them. So there 10 isn't a lot of note-taking. 11 Q So we know that the decision is made 12 eventually to terminate this project, terminate 13 the contract? 14 A Yes. 15 Q Is that a decision that you were 16 authorized to make? 17 A No. 18 Q Who within the company made that 19 decision? 20 A Ultimately, Greg McCarthy with legal 21 involvement. 22 Q And Greg McCarthy, he was the CIO at 23 the time, right? 24 A No. He was the chief operating 25 officer. Page 203 1 Q Thank you. So Mr. McCarthy is not an 2 IT guy so to speak? 3 A No. 4 Q So he wouldn't know by himself whether 5 Apacheta's performance on the project was good 6 or bad or indifferent, right? 7 A Not by himself, no. 8 Q He would rely on the input of others 9 like yourself? 10 A Yes. 11 Q Was it your recommendation to Mr. 12 McCarthy that the project be terminated? 13 A Yes. 14 Q And what were the reasons that you 15 recommended to him that the project be 16 terminated? 17 A The gaps that were listed in my 18 summarization. 19 Q So in this summary that you prepared 20 and you delivered to the executives by the 21 middle of October -- it's around there. We're 22 approximating. We'll get the actual document, I 23 think. How detailed is that? How long is it? 24 MR. LIPMAN: Can I talk to her outside 25 just for a minute? Page 204 1 MR. STAR: Yes. 2 MR. LIPMAN: It's possible there is a 3 semantics issue here and I may actually 4 know what she's talking about. It may have 5 been produced, and if so, we can get it in 6 front of you. It may be a different 7 document. Give me a minute. 8 (Recess taken) 9 BY MR. STAR: 10 Q Let me ask you this in the event that 11 we don't find this document. The details in the 12 document that you prepared for the executive 13 team in the middle of October of 2015, were 14 those details then shared with Apacheta in any 15 written document? 16 A I'm not aware of that. 17 MR. STAR: This will be Exhibit 24. 18 (Exhibit 24 marked for 19 identification.) 20 BY MR. STAR: 21 Q Exhibit 24 is Lincare 9816 through 22 9819. On the first page, which includes the 23 last two e-mails in this chain, you're involved. 24 The first e-mail is in the middle of 25 the first page. It's from Greg McCarthy to you Page 205 1 on November 1st, asking for an update on 2 Apacheta. Do you see that? 3 A Yes. 4 Q He says, "I know Paul was evaluating 5 this for you to see what options we have for 6 cancellation." 7 To your recollection, what were the 8 options for cancellation of the contract as of 9 November 1, 2015? 10 A That was what Paul, our legal counsel, 11 was evaluating. 12 Q So you didn't know yet at that point 13 in time what the options were for cancellation? 14 A Correct. 15 Q And then if you look at the top 16 e-mail, which is from you back to McCarthy on 17 November 2, 2015, you write in that second 18 paragraph, "If you receive anything additional 19 from Apacheta, please send it to Paul." 20 Do you see that? 21 A Yes. 22 Q So does this mean at this point in 23 time, basically Lincare is only going to be 24 communicating through legal counsel to Apacheta? 25 A I believe it was decided at this point 52 (Pages 202 - 205) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 53 of 68 Page 206 1 it would be -- the final communication would be 2 from Greg from Lincare to Gregg at Apacheta. 3 Q At this point, you had decided that 4 you're cancelling, that you're terminating? 5 A Yes. 6 Q Because up at the top of your e-mail, 7 the first paragraph, the second sentence, "Rob 8 and I are sending him all correspondence," 9 referring to Paul, "we have received for him to 10 review and put the final cancellation letter 11 together." 12 A Yes. 13 Q Does this refresh your recollection as 14 to when exactly the decision had been made at 15 Lincare to terminate the project? 16 A I don't know the exact date. 17 Q But it would have been sometime at 18 least right around November 2nd of 2015? 19 A I would imagine around that time 20 frame, yes. 21 Q And then you write in the last 22 sentence, "We have simply told Apacheta that new 23 management is reviewing the project and we will 24 get back to them." 25 So you hadn't yet informed Apacheta Page 207 1 that Lincare was planning to terminate the 2 contract? 3 A Not yet. 4 MR. STAR: Let's mark this as 25. 5 (Exhibit 25 marked for 6 identification.) 7 BY MR. STAR: 8 Q So Exhibit 25 is Bates labeled 9 Apacheta 13639 through 13651. We've talked a 10 number of times today about what Ms. Forgeng 11 sent to Lincare on November 20, 2015. 12 This is Ms. Forgeng's e-mail of that 13 date attaching acceptance criteria and a 14 proposed project plan, correct? 15 A Yes. 16 Q And if you will look at what's 17 actually attached here, these are, in fact, the 18 acceptance criteria that she send. And at the 19 very end of this, at pages 13650 and 51 are the 20 project plan, correct? 21 A It's a shell of a project plan. 22 There's no dates. There's no responsibility. 23 Q I understand your caveats. All I'm 24 trying to do is to make sure we've got the right 25 documents here. Page 208 1 This is in fact what Ms. Forgeng sent 2 to you, to Lincare on November 20, 2015? 3 A Yes. 4 Q That's all I'm trying to establish? 5 MR. STAR: This will be 26. 6 (Exhibit 26 marked for 7 identification.) 8 BY MR. STAR: 9 Q Exhibit 26 is one page, Lincare 9778. 10 It begins at the bottom with Ms. Forgeng's 11 November 20th e-mail attaching the acceptance 12 criteria and project plan. Above that, we see 13 Rob Batezel forwards that to you later that same 14 evening, on November 20, 2015, right? 15 A Correct. 16 Q And then the e-mail at the top is from 17 you to McCarthy dated November 23, 2015. So 18 this is the next Monday after the e-mail from 19 Ms. Forgeng? 20 A Yes. 21 Q Now, at this point in time, we're 22 about a month at least since Lincare has already 23 decided internally it's going to terminate the 24 project, right? 25 A Like I said, I don't know the specific Page 209 1 date. 2 Q So go back and look at Exhibit 24. 3 A Okay. 4 Q So that's e-mails between you and 5 McCarthy on November 1st and November 2nd of 6 2015, right? 7 A Yes. 8 Q And that one from you at the top of 9 Exhibit 24 dated November 2nd references that 10 Paul, legal counsel, is going to be "putting 11 together the final cancellation letter?" 12 A Correct. 13 Q So at least as of November 2nd, 14 Lincare had made up its mind that it's 15 terminating this project? 16 A The recommendation was to terminate 17 this project. I can't say that -- I mean, it 18 was still in legal review. I don't think the 19 final decision was made yet. 20 Q So help me understand. When was the 21 final decision made to actually terminate? 22 A I wasn't involved in the final 23 decision. I can't give you the exact date. 24 Q Who would have been involved besides 25 Mr. McCarthy? 53 (Pages 206 - 209) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 54 of 68 Page 210 1 A Legal. 2 Q And that would have been Paul Tripp? 3 A I'm not sure if it was Paul himself. 4 Q Your e-mail on Exhibit 24 from 5 November 2nd says Paul is going to put the final 6 cancellation letter together. 7 When, if at all, did you actually see 8 a final cancellation letter that was put 9 together? 10 A Did I personally see it? 11 Q Right. 12 A I can't remember if I saw the final 13 cancellation letter. I was pretty much being 14 pulled out of it at that point. 15 Q Were you asked to review a 16 cancellation or termination letter? 17 A I don't remember. I think I made a 18 recommendation. I can't -- I think I made a 19 recommendation on the initial cancellation 20 letter, but then, again, I got pulled out of the 21 discussions from that point forward. 22 Q Was there more than one version of the 23 cancellation letter? 24 A Do you mean that went to Apacheta? 25 Q No, not that went to Apacheta. Page 211 1 Obviously, there's a letter that went out on 2 February 1, 2016, and we'll take a look at that 3 in a minute. 4 My question is, was there any earlier 5 version of that document that was not sent? 6 A Not that I'm aware of, but like I 7 said, I wasn't privy to that at the time. 8 Q Help me to understand. We see here 9 that at least as you've told me, the 10 recommendation has been made by November 2, 2015 11 to terminate the project and Mr. Tripp is going 12 to be working on the termination letter, right? 13 A Correct. 14 Q And then we see in Exhibit 26 on 15 November 23rd that you're recommending that it's 16 important to officially respond to Apacheta that 17 Lincare does not accept the requirements and the 18 documents that Ms. Forgeng sent on November 19 20th? 20 A Correct. 21 Q If the decision had already been made 22 or the recommendation at least had already been 23 made in early November to terminate, we can 24 agree that whatever was in the acceptance 25 criteria and test plan that Ms. Forgeng sent on Page 212 1 October 20th was not among the reasons why 2 Lincare decided to terminate the project? 3 A I believe there were some things in 4 the acceptance criteria, but I can't say it was 5 the only thing, no. 6 Q But if the acceptance criteria didn't 7 actually come to you until nearly three weeks 8 after the decision had been made to terminate, 9 whatever was in the acceptance criteria you got 10 three weeks later couldn't have had bearing on 11 the decision earlier in the month, right? 12 A Well, I think the bearing is that the 13 acceptance criteria is based on the 14 requirements, which, again, were only what 15 Apacheta could accomplish and not what we 16 needed. 17 Q So that we understand it, because I'm 18 entitled to know this and I think it's kind of 19 clears and hopefully we'll get this document 20 that has your study in it, is it safe to say 21 that the reasons you recommended termination 22 were because you felt that the requirements 23 documented in the functional specifications 24 didn't meet Lincare's needs, but that had 25 nothing to do with the acceptance criteria Page 213 1 itself you received on November 20th? 2 A Are you asking for my basis and 3 recommendation? 4 Q Yes. Let's try it that way. What was 5 the basis for your recommendations? 6 A The basis for my recommendation were 7 the requirements that Apacheta could not meet 8 that were core requirements for Lincare. 9 Q Things you thought were missing from 10 the October 5th functional specifications? 11 A From the beginning, even way before 12 October 5th. 13 Q But at least in your view, they were 14 not part of what -- 15 A They were not part of October 5th or 16 any version of the functional requirements. 17 (Exhibit 27 marked for 18 identification.) 19 BY MR. STAR: 20 Q Exhibit 27 is Lincare 7177 and 7178. 21 It's a chain of e-mails that you're involved in. 22 Again, at the bottom, it begins with Cora's 23 e-mail of November 20th attaching acceptance 24 criteria and project plan. 25 She then follows-up in a second e-mail 54 (Pages 210 - 213) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 55 of 68 Page 214 1 on December 1st to Rob Barnes and Craig saying, 2 "I didn't see a response and wanted to make sure 3 that you received the message. Please let me 4 know." 5 Do you see that? 6 A Yes. 7 Q And then Rob Batezel writes to you 8 with a copy to Barnes Marshall and Craig Kopetz 9 saying, "How do we handle a response to this, or 10 should we not respond? I thought Apacheta was 11 informed about our decision to terminate the 12 contract with them." 13 Do you see that? 14 A Yes. 15 Q So when we looked at the November 2nd 16 e-mail where there's a discussion about Paul 17 preparing a termination letter, what you said is 18 you're not sure as of that date that the 19 official decision had been made to actually 20 terminate, but a recommendation had been made, 21 right? 22 A Right. 23 Q Now here we see Rob Batezel who is not 24 a management level person, right? 25 A He is. Page 215 1 Q He is? 2 A Yes. 3 Q But he's not in the executive meeting 4 sessions I should say? 5 A No. It's an IT manager. 6 Q And when you go to these executive 7 meetings with the CEO, et cetera, Rob wouldn't 8 go to those meetings? 9 A No. 10 Q Nor would Barnes Marshall or Craig 11 Kopetz? 12 A No. 13 Q So how would Rob and Barnes and Craig 14 have known that a decision was made to terminate 15 the contract with Apacheta? 16 A So we had talked to the project team. 17 That's why in these project meetings, we were no 18 longer responding that, you know, as far as the 19 project is being evaluated. 20 Q Who would have talked to the project 21 team? When you say we, who is that? 22 A Me. I talked to them. 23 Q In what format does that kind of 24 meeting happen? 25 A It was just a manager's meeting. Page 216 1 Q Let me ask you this. We talked about 2 the executive meetings you had twice a month. 3 A Yes. 4 Q Were you having regular internal 5 Lincare meetings with the folks from Lincare who 6 were working on the Apacheta project? 7 A Periodic meetings, yes. 8 Q How often? 9 A Probably once every couple of weeks. 10 Q Those would be run by you? 11 A We have a group lead meeting it's 12 called. This specifically was a meeting where I 13 pulled them into my office. 14 Q You pulled these three gentlemen into 15 your office? 16 A Yes. 17 Q And you told them what? 18 A That this project right now is hold 19 until we have a final decision. 20 Q I'm a little confused, because 21 obviously Rob Batezel on December 1, 2015 is 22 saying he thought Apacheta was informed about 23 the decision to terminate. 24 A This is him thinking out loud. When I 25 said it's on hold, there's the issues you guys Page 217 1 have brought up, the issues other people have 2 brought up. We have a lot of issues with this. 3 So it's on hold. I'm thinking he's thinking out 4 loud. 5 Q So from Lincare's official 6 perspective, forgetting what Rob Batezel might 7 have to say here, as of December 1st, is it your 8 testimony that Lincare still hadn't made a 9 decision on whether to terminate? 10 A They had not sent the final 11 termination letter. 12 Q I know the termination letter hadn't 13 been sent. Obviously, there's going to be some 14 work in advance of sending a termination letter. 15 A decision is going to be made in advance of 16 that, right? 17 A Right. 18 Q It doesn't happen contemporaneously. 19 A Right. 20 Q I'm just trying to find out when the 21 decision was made? I'm trying to refresh your 22 recollection. 23 A I can't give you the exact date. 24 Q But looking at this e-mail, to your 25 recollection as of December 1st of 2015, had the 55 (Pages 214 - 217) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 56 of 68 Page 218 1 decision officially been made to terminate? 2 A No. I'm not aware that it was made at 3 that point. There was a recommendation in legal 4 and Greg were looking through it. 5 (Exhibit 28 marked for 6 identification.) 7 BY MR. STAR: 8 Q What we've marked as Exhibit 28 is a 9 letter sent by U.S. mail signed by Greg 10 McCarthy, COO of Lincare, February 1, 2016, to 11 Apacheta, attention, Gregg Timmons. 12 Do you see that? 13 A Yes. 14 Q So I take it this is the official 15 termination letter? 16 A Yes. 17 Q Now that we've gone through all of 18 this and gotten down to this point, to your 19 recollection, had you seen any prior drafts of 20 this letter before it was sent? 21 A Not this letter, no. 22 Q Did you work on this letter at all or 23 provide any input for it? 24 A No. 25 Q The letter reads, "Dear Gregg. Page 219 1 Reference is made to our recent e-mail 2 communication exchange regarding the current 3 status of the project. As you know, the project 4 included Apacheta's submission of proposed 5 requirements for the software's development, 6 such requirements to be subject to the Lincare's 7 acceptance." It's obviously a typo there. Do 8 you see that? 9 A Yes. 10 Q Now, the requirements would have been 11 the functional specs from October 5th, right? 12 A You know, I can't say that. That's 13 such a nebulous term. How many times have we 14 used the word requirements in different 15 documents. 16 Q He goes on to say in the next sentence 17 here, "Lincare has reviewed the proposed 18 requirements, as well its own expectations of 19 the software's functionality. 20 A Okay. 21 Q Who would have reviewed the proposed 22 requirements? That would have been the work 23 that you and your team, Barnes and -- 24 A Yes. The project team. 25 Q And the requirements -- we would have Page 220 1 to agree that Mr. McCarthy is referring to the 2 October 5, 2015 functional specifications, 3 right? 4 A I can't confirm that. 5 Q Just you reading this, you're not sure 6 what he's referring to? 7 A I believe he's referring to the 8 acceptance criteria, but requirements, like I 9 said, is a very high-level term. 10 Q Well, help me to understand, because 11 I'm trying to figure out what the reasons are 12 for termination. 13 It looks like you and I can't even 14 come to an understanding of what Mr. McCarthy 15 meant by the proposed requirements. 16 Do you know what he meant? 17 A They're requirement documents that 18 were produced throughout the project. There 19 were a lot of them. You're asking me to say 20 which document, and there were so many of them. 21 You can see. 22 Q We've gone through a lot of e-mails 23 here between you and McCarthy, right? 24 A Uh-huh. 25 Q Yes? Page 221 1 A Yes. 2 Q And you were having conversations with 3 McCarthy about the status of the project? 4 A Yes. 5 Q McCarthy is the COO and he's one of 6 the three people that you're reporting to every 7 other week in these executive meetings, right? 8 A Yes. 9 Q And at least in October, there's two 10 meetings about the status of the Apacheta 11 project? 12 A Right. 13 Q And we've seen that at least beginning 14 in early November of 2015, there's you told us a 15 recommendation from you that the project be 16 terminated? 17 A Correct. 18 Q And that proceeds by about three weeks 19 Ms. Forgeng actually sending the acceptance 20 criteria. She sent them on November 20th. 21 A Okay. 22 Q Right? 23 A Yes, she did. 24 Q And at that point in time, what you 25 had to review was whatever analysis you had 56 (Pages 218 - 221) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 57 of 68 Page 222 1 done, plus the October 5, 2015 specifications 2 that Cora had sent, right? 3 A Yes. 4 Q So you were the primary person, I take 5 it, at Lincare that Mr. McCarthy was coming to 6 for advice about what to do on the project? 7 A I was the primary person, not the only 8 person. 9 Q Understood. With that background, are 10 you able to tell me, either in your individual 11 capacity or on behalf of Lincare itself, when 12 Mr. McCarthy writes in his February 1, 2016 13 letter that Lincare has reviewed the proposed 14 requirements, are you able to tell me what 15 documents or documents he's referring to having 16 been reviewed? 17 MR. LIPMAN: Objection. You can 18 answer, if you know. 19 A I can tell you what I believe. 20 BY MR. STAR: 21 Q You can give me your personal belief. 22 A It was all of the requirement 23 documents that were part of the project. 24 Q And just so we've got it here and I 25 understand it. What are those documents? Page 223 1 A They are functional requirement 2 documents. 3 Q From October 5th? 4 A Scope documents. 5 Q Wait, from October 5th, right? 6 A Well, there was other versions of the 7 document. Let's say the final one on 8 October the 5th, which was not final. I just 9 want to make sure that's clear. 10 Q You've said it a gazillion times if 11 you've said it once. I understood your caveat, 12 ma'am, that you believe in your view and I'm 13 sure you hold this belief, that those documents 14 sent on October 5th were not what you considered 15 to be final. Okay? 16 You understood, though, that at least 17 from Apacheta's perspective, they considered 18 them to be final. They were asking you for 19 review of them, correct? 20 A Right. 21 Q And you were reporting week after week 22 after week that you were reviewing them? 23 A Correct. 24 Q So all I'm trying to find out is when 25 Mr. McCarthy on February 1, 2016 terminates this Page 224 1 contract and he tells Apacheta that Lincare has 2 reviewed the proposed requirements, what exactly 3 is he referring to? If you don't know, that's 4 fine. 5 A It's the requirement documents, all of 6 them. 7 Q I'll take that. We'll move on. He 8 goes on to say, "While Lincare appreciates (and 9 understands it has paid for) the work Apacheta 10 has provided Lincare during the project's 11 inception phase to date, after further review, 12 Lincare has determined such requirements do not, 13 and given the inherent limitations in the 14 project, will not meet Lincare's needs." 15 Do you see that? 16 A Yes. 17 Q We don't see anywhere in this letter 18 any specific reference to any inherent 19 limitation or anything in the software or the 20 project that's actually lacking or not meeting 21 Lincare's needs, do we? 22 A There is nothing specific. 23 Q Nowhere in this letter does Mr. 24 McCarthy say that Apacheta was ever in breach of 25 any term, condition or provision of the Page 225 1 contract, correct? 2 A There's no comment in here about 3 breach. 4 Q He closes in the first paragraph by 5 saying simply, "As such, Lincare does not see a 6 path forward with Apacheta on this project." 7 Do you see that? 8 A Yes. 9 Q "Thank you for your consideration. 10 Feel free to contact me if you would like to 11 discuss this matter further." 12 That's the end. Right? 13 A Yes. 14 Q Mr. McCarthy doesn't mention the 15 30 day period for Apacheta to cure any 16 particular deficiency or breach? 17 A No. I don't see that mentioned. 18 Q And this was the last communication, 19 right? There was no further back and forth 20 about -- 21 A I haven't seen any other 22 communication. 23 MR. STAR: Let's take a couple of 24 minutes to review what all I have left. 25 (A short recess was taken.) 57 (Pages 222 - 225) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 58 of 68 Page 226 1 BY MR. STAR: 2 Q Let's cover another subject. Let's 3 talk about your analysis of other vendors. 4 That's something that you started on pretty 5 early after joining Lincare, right? 6 A Yes. 7 Q Has Lincare gone to a different 8 provider at this point? 9 A Yes. 10 Q Who have you gone to? 11 A Microsoft FieldOne. 12 Q When did that happen? 13 A When we contracted? 14 Q Yes. 15 A I want to say late April, early May of 16 2016. 17 Q Is there a written contract? 18 A Yes. 19 Q Tell me what that agreement is for. 20 Is it for services and licensing or is it one or 21 the other? 22 A With Microsoft, it's mostly licensing 23 and storage. 24 Q Were there services provided in 25 connection with Microsoft? Page 227 1 A Not with Microsoft, no. 2 Q So you licensed for Microsoft a 3 software solution. Is there a systems 4 integrator or somebody like that? 5 A There's a professional services 6 company. 7 Q Who is that? 8 A PowerObjects. 9 Q Where are they out of? 10 A I don't know where their headquarters 11 is. 12 Q So you had a services agreement with 13 them? 14 A Yes. A statement of work. 15 Q And when did that get signed? 16 A May, June time frame. 17 Q So you signed a separate license 18 agreement with Microsoft, right? 19 A Yes. 20 Q Do you have a support and maintenance 21 agreement with Microsoft? 22 A Yes. 23 Q And then you got a services and 24 statement with work with PowerObjects? 25 A Yes. Page 228 1 Q With regard to the Microsoft license 2 and maintenance agreement or agreements, I'm not 3 sure if it's more than one, were license fees 4 due right away? 5 A No. 6 Q When are license fees owed? 7 A When it's implemented. 8 Q And has it been implemented? 9 A Not yet. 10 Q When do you anticipate that it will 11 be? 12 A Beta sites, late February or March of 13 this year, like next month at the earliest, but 14 probably late February or March. 15 Q Did you go through an RFP process to 16 choose a new vendor? 17 A Yes. 18 Q How many vendors did you solicit 19 proposals from? 20 A I don't remember the exact number, but 21 I want to say eightish. 22 Q Obviously, we've seen, you know, for 23 example, the functional specifications that 24 Apacheta provided Lincare during the project. 25 Was any of that kind of documentation Page 229 1 or any other documents produced that were 2 prepared by Apacheta shared with vendors like 3 Microsoft? 4 A No. 5 Q Microsoft has never seen any of the 6 Apacheta documents? 7 A No. 8 Q What about PowerObjects? Was anything 9 shared with them that Apacheta had prepared? 10 A No. 11 Q Who prepared the request for proposal 12 that went out? 13 A Primarily me. 14 Q When was that done? 15 A I don't know the exact time frame. I 16 would be guessing, but I want to say it was in 17 the Decemberish time frame. 18 Q Do you know what the license fee is 19 with Microsoft? 20 A I'm not sure that I can -- is that 21 confidential information? 22 Q Not that I know of. 23 MR. LIPMAN: If there's a confidential 24 agreement, then I would prefer that you not 25 testify to that and we can address that 58 (Pages 226 - 229) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 59 of 68 Page 230 1 later, if it's a fact that can be filled 2 in. 3 BY MR. STAR: 4 Q Is the license fee based on a number 5 of users? 6 A Yes. 7 Q How many users; do you know? 8 A I don't remember the exacts. I would 9 be guessing. I think it's around 2,800. 10 Q Your understanding in this industry is 11 there's usually like a yearly audit of how many 12 users a license fee will have, right? 13 A Yes. 14 Q And then if you have more users, 15 you'll pay additional software license fees? 16 A Correct. 17 Q Is there any kind of analysis or for 18 lack of a better word, a study that's been done 19 within Lincare as to what your expected user 20 count is going to be on the Microsoft FieldOne 21 software over the coming years? 22 A We actually expect it to go down. 23 Q Why is that? 24 A Because of site consolidations and 25 efficiencies. Page 231 1 Q Is there any document where that kind 2 of analysis has been done where you've got sort 3 of an expected user count over the years? 4 A No. 5 Q So what's really your basis for saying 6 now that you expect the user count to go down? 7 Is that just your personal opinion? 8 A Just the benefits of the project. 9 Q What about if Lincare acquires other 10 companies? Would the user count remain the 11 same, go down up, go up? 12 A If we acquired a substantial company, 13 it would, but most of our acquisitions are very 14 small. 15 Q You say it would go up? 16 A It would go up. 17 Q Lincare actually just did a recent 18 acquisition, right, of a pretty significant 19 company called American Home Patient? Are you 20 familiar with that? 21 A Yes. That was back in January of 22 2016. 23 Q Right. Did that increase your user 24 count? 25 A No. Page 232 1 Q It stayed the same? 2 A Yes. 3 Q So nobody that you brought into 4 Lincare from American Home Patient is going to 5 be a user of the Mobility solution with 6 Microsoft? 7 A I would say, yes, they would, but this 8 gets into the site consolidations. 9 Q I see. Were you part of negotiating 10 either the license or maintenance agreement with 11 Microsoft or the statement of work or other 12 services agreements with PowerObjects? 13 A Yes. 14 Q You have access to those documents? 15 A Yes. I'm trying to remember. I think 16 they're up on our shared drive. 17 Q You say you're going to do a Beta site 18 in late February or March of this year, right? 19 A Yes. 20 Q So you're pretty far along in the 21 project? 22 A Yes. We're in final testing. 23 Q Describe for me, in general, how did 24 that project progress? You did a requirements 25 gathering? Page 233 1 A Yes. So we did the RFP process with 2 many vendors with our requirements and the 3 scoring of those vendors with Microsoft being 4 the highest score in all areas. 5 So you're asking as we progress on the 6 project, yes, there's statement of works, 7 there's acceptance of those statement of works 8 in phases. And at any point, we can term if we 9 don't accept. 10 Q You prepared a scoring document. You 11 just referred to it, I think, right? 12 A Yes. 13 Q We'll take a quick look at it. 14 (Exhibit 29 marked for 15 identification.) 16 MR. STAR: You know what, 29 gets a 17 little bit tough, because what we marked as 18 29 is Lincare is 10675 with some 19 attachments to it, but for whatever reason, 20 that e-mail doesn't produce with the name 21 of the person who sent it or the date. 22 Let me just show you one other 23 document real quick, which does have a date 24 so we can figure this out. We'll make that 25 30. 59 (Pages 230 - 233) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 60 of 68 Page 234 1 (Exhibit 30 marked for 2 identification.) 3 BY MR. STAR: 4 Q So this is however the document 5 production software works. If you look at the 6 bottom of what we marked as Exhibit 30, which is 7 Lincare 9679 through 9680, there's an e-mail 8 from you on February 4, 2016. So three days 9 after the termination letter goes out, right? 10 A Yes. 11 Q And the subject is FSM scores and 12 summary? 13 A Yes. 14 Q And if you compare that to the e-mail 15 that's on Exhibit 29, you see it's the same 16 exact e-mail? 17 A Yes. 18 Q The only difference is the version 19 that was produced to us, which we've marked as 20 Exhibit 29 actually has the attachment? 21 A Okay. 22 Q Right? 23 A All right. 24 Q So let's go back to Exhibit 29. I 25 just want to make sure we agree, because later Page 235 1 on in the case, we'll only want to use one of 2 these exhibits. So let's try to agree on the 3 day. 4 I don't know why the software system 5 does that, but we can agree that the e-mail that 6 is Exhibit 29 and is Bates labeled Lincare 10675 7 was sent from you, right? 8 A Well, it doesn't have my name on it. 9 Q I'm trying to work with you here, 10 because if we match that up against the e-mail 11 that's Exhibit 30 at the bottom, you see it's 12 from you, Linda Reid? 13 A Yes. 14 Q And it says the date is February 4th? 15 A Not on this one. 16 Q No. If you look at Exhibit 30, ma'am. 17 Do you see down at the bottom? 18 A Yes. 19 Q Right here it says from Linda Reid, 20 sent Thursday, February 4, 2016 at 7:01 p.m. 21 A Yes. 22 Q And then it's to McCarthy, Hoefer, 23 Teufel and Hartwig, right? 24 A Yes. 25 Q And the subject is FSM scores and Page 236 1 summary? 2 A Okay. 3 Q Okay. And then go and compare that to 4 the document that actually has the scoring chart 5 that you created attached. It's the same 6 e-mail, right? The text of the e-mail is 7 exactly the same? 8 A I believe it is, but there should be a 9 name at the top. Usually that means it was a 10 draft. So like in the other one that didn't 11 have a name, it means a draft was never sent. 12 That's why you have no name. 13 Q Help me understand. I'm trying to 14 establish when you sent this out to the people 15 that are listed. 16 It looks like you sent this -- from 17 what we can see on Exhibit 30, it looks like you 18 sent this e-mail on February 4, 2016. 19 A I can't say for sure because -- I 20 would have to really verify it. This is a 21 draft. The one you're showing me is a draft. 22 Q We're talking about two different 23 exhibits. Let's step back. You've got Exhibit 24 29 in your hand? 25 A Yes. Page 237 1 Q I think what you're telling me is 2 Exhibit 29 itself is a draft and you didn't hit 3 send on that draft? 4 A Correct. 5 Q But Exhibit 29 actually has the 6 attachment? 7 A Okay. 8 Q Yes? 9 A Well, it's not in the exhibit. 10 Q Exhibit 29 in your left hand has -- 11 A Has an attachment that is not attached 12 to Exhibit 30 is all I'm saying. 13 Q This is my whole point. I'm just 14 trying to get us to the point where I can 15 understand -- let me try it a different way. 16 The document in your left hand has 17 your score cord or whatever you want to call it, 18 right? 19 A Yes. 20 Q Did you send that off to folks like 21 McCarthy and Hoefer and Teufel? 22 A I believe I did. 23 Q Based on what we're seeing on 24 Exhibit 29 and Exhibit 30, can you tell me when 25 you sent that to them? 60 (Pages 234 - 237) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 61 of 68 Page 238 1 A It looks like on February 4th. 2 Q You say that's a draft. Let's stick 3 with Exhibit 30, right? 4 A Yes. 5 Q Which was sent on February 4th. You 6 write, "In the last executive project review 7 meeting, it was mentioned that we should add 8 Apacheta to the overall scoreboard to show how 9 they are missing critical components needed in 10 FSM, just in case we need it at some point." 11 Do you see that? 12 A Yes. 13 Q So we can agree that prior to sending 14 the termination letter on February 1st, you 15 hadn't included Apacheta in your scorecard? 16 A No, because we had already produced 17 the other document with these. 18 Q I don't care of the reason. I'm only 19 asking, we can agree that you hadn't included 20 Apacheta in your scorecard? 21 A Correct. 22 Q Now, prior to the termination letter 23 of February 1, 2016, had you been actually 24 meeting with other potential vendors? 25 A Yes, not until after the decision was Page 239 1 made that we were going to cancel. They wanted 2 me to have a plan B. 3 Q When do you recall first meeting with 4 any vendor? 5 A I can't recall the date to be quite 6 honest. It's hard to say without going back and 7 looking. 8 Q Salesforce is one of the companies you 9 looked at, correct? 10 A Yes. 11 Q How far in the process did you get 12 with Salesforce? 13 A The same with the other vendors. We 14 went through the requirements and they did a 15 demo and then we assessed. 16 Q They actually responded in writing to 17 your RFP? 18 A The RFP -- they came in and did an 19 actual online demo with us, each vendor came in, 20 and we went through the document together. 21 Q Would you have records in your 22 possession at work that would tell us when these 23 vendors came in to meet with you? 24 A I would be able to go back on my 25 Outlook calendar. Page 240 1 MR. STAR: Off the record for a 2 second. 3 (Discussion off the record.) 4 MR. STAR: Let's go back on the 5 record. With regard to the attachment to 6 Exhibit 29, we're going to leave the 7 attachment off of your transcript for now, 8 because there's some debate about whether 9 some information on there is confidential 10 or commercially sensitive and we'll cross 11 the bridge when we come to it and figure 12 out what to do. 13 (Exhibit 31 marked for 14 identification.) 15 BY MR. STAR: 16 Q So we now have the document titled 17 Lincare's critical business requirements and 18 major deficiencies in Apacheta's solution to 19 meet the needs. We've marked this as 20 Exhibit 31, right? 21 A Yes. 22 Q Now, this is a document that you 23 personally prepared, Ms. Reid? 24 A Yes. 25 Q Did anybody assist you in preparing Page 241 1 this? 2 A The project team members that were 3 involved. 4 Q Barnes, Rob, Craig? 5 A Yes. 6 Q Anybody else? 7 A Some of it came from comments from the 8 business users and what they saw as gaps, but 9 not that they helped us prepare it. 10 Q So we were talking earlier in 11 connection with an e-mail we saw from 12 October 7th that you were preparing a summary of 13 the project. 14 Is this that summary? 15 A Yes. 16 Q And you told us earlier that you 17 thought you had completed it by sometime around 18 give or take the middle of October? 19 A I believe. 20 Q In what way was this document to your 21 knowledge then used by anybody within the 22 company besides yourself? Was this presented by 23 you to anybody? 24 A This was presented to the executive 25 team. 61 (Pages 238 - 241) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 62 of 68 Page 242 1 Q When? 2 A Somewhere in that same time frame. 3 Q During a meeting between you and the 4 three executives? 5 A Yes. I believe I reviewed it with 6 Kristen first and then in the next meeting with 7 the executive team. 8 Q And I asked you this earlier having 9 myself not actually gotten the document yet, if 10 it was ever sent by you or anybody else at 11 Lincare to anybody at Apacheta? 12 A It was not sent by me. I'm not aware 13 if it was sent by Greg or anybody else. 14 Q And there are ten different items with 15 bold headings that you have on here, right? 16 A Correct. 17 Q And just so we're clear, I've got a 18 one page document. It's not Bates labeled. Is 19 that the entirety of the document? 20 A I'm sorry, I don't understand the 21 question. 22 Q What I've been given here by your 23 counsel is a single page, right? 24 A Yes. 25 Q It has no Bates label, because we've Page 243 1 just gotten it here today. I'm just trying to 2 find out. Was there another page to this or is 3 this the entire thing? 4 A No. It was only one page. 5 Q So this document to your knowledge, 6 the document itself was never transmitted to 7 anyone at Apacheta. 8 Did anybody including yourself take 9 the actual information on here and put it into a 10 different format, like an e-mail or a letter or 11 a spreadsheet and send that off to Apacheta? 12 A Not at this time, but a lot of these 13 issues were e-mailed to Apacheta as issues, like 14 the Mike Moore e-mail, back in September is we 15 have to have active directory from a security 16 and HIPAA risk standpoint. The same thing with 17 the forms. 18 Q You've talked about before things that 19 you viewed as gaps in the functional 20 specifications from October 5th. 21 Are these the gaps that you were 22 talking about? 23 A These are the major gaps. 24 Q You believe there were others? 25 A Yes. Page 244 1 Q They're not identified on this 2 document? 3 A No, because these were major, major 4 showstoppers. 5 Q You believe that these things were 6 showstoppers; in other words, that Lincare 7 simply couldn't go forward with Apacheta because 8 of these things? 9 A Correct. 10 Q Now, obviously, you complete this 11 document after having received the functional 12 specs from Cora on October 5, 2015? 13 A Yes. 14 Q I'm just curious. There are multiple 15 versions of those functional specifications. We 16 saw that. 17 A Right. 18 Q It goes months, right? 19 A Yes. 20 Q And Lincare is asking Apacheta to do 21 work on those functional specifications for a 22 long time? 23 A Yes. 24 Q Your testimony today has been that 25 these gaps that you're identifying here in this Page 245 1 internal Lincare document are ones that existed 2 all along, right? 3 A And that were communicated to Apacheta 4 who responded that they don't have the ability 5 to do this. 6 Q So if that is the case, that if these 7 are such showstoppers, they would have been 8 showstoppers from the very beginning too, right? 9 A Yeah. I think in the very beginning, 10 there was the spirit to try to get Apacheta to 11 cover these gaps. 12 Q But, for example, on the Lincare 13 TransportAce functional requirement, we saw that 14 goes through seven versions beginning in early 15 July of 2015 all the way up through October 5th? 16 A Right, but that is screens of a 17 particular module that, like again, Apacheta 18 never addresses are issues. The functional 19 requirements are only what they can do. 20 Every time these issues are brought 21 up, it's in a discussion. There are some 22 e-mails from Apacheta saying that they cannot 23 interact with Active Directory. So they just 24 take it off the table. Their functional 25 requirement only includes what they can do. 62 (Pages 242 - 245) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 63 of 68 Page 246 1 Q I understand your perspective on that. 2 My question is a little bit different. 3 Understand where I'm coming from. Okay? 4 Let's assume your point is true and 5 that Apacheta is only putting in the specs what 6 it can actually do, your point here is, there 7 are things that Lincare needs all along; and in 8 your view, Apacheta could never deliver them, 9 right? 10 A Yes. 11 Q So my question is simple. Why have 12 Apacheta go through iteration after iteration of 13 functional specifications when you think there 14 are all along missing, critical missing pieces? 15 MR. LIPMAN: Objection. You can 16 answer. 17 A Well, I wasn't here. So I can only 18 speak to from October 1st on and I can only 19 speak to that these things were brought up. And 20 the management at the time says we feel that, 21 you know, they'll address them, even though they 22 say they can address them, we're going to in the 23 spirit of trying to move this project forward, 24 we're going to see if we -- but most of these 25 things, Apacheta has asked Lincare to develop a Page 247 1 solution. 2 So it has put Lincare at, you know, as 3 far as from a development standpoint and cost, 4 huge exposure. We wouldn't be looking for a 5 vendor if we wanted to build this ourself. 6 So there was a lot of work being done 7 on Lincare trying to see if we could fill the 8 gap, and we could not fill the gap and the 9 vendor could not supply what should be an FSM 10 solution. 11 So all I can say to you is that they 12 were raised, there was a lot of concerns, there 13 were e-mails to the point that finally people 14 like Mike Moore surfaced it to the executive 15 team and said right before I came, that this is 16 just not going to work. 17 Q I understand your answer. Let me 18 understand this. You make your analysis pretty 19 quickly, right? You joined October 1st. 20 A Yes. 21 Q You start on your study by October 7th 22 or 8th, right? 23 A It was pretty quick, yes. 24 Q And you delivered this document by the 25 middle of October? Page 248 1 A Yes. I don't know the exact thing, 2 but I think it's middle to late October. 3 Q So, I guess, from your own personal 4 perspective, you think whatever deficiencies 5 that you believe existed within what Apacheta 6 was proposing to deliver were pretty obvious? 7 A Yes. 8 Q Yet, nobody ever, whether it was 9 before you joined or after, ever put all of 10 those concerns into one particular document and 11 said to Apacheta, hey, we can't go forward with 12 you guys, because you can't deliver us an actual 13 working solution and, therefore, you're in 14 breach of this contract? Nobody ever did that? 15 A Not in one individual document. 16 Q Okay. You believe it's over a series 17 of different communications? 18 A Meetings, e-mails. And again, this 19 was Lincare's complaint to me, the project team 20 is in all of these meetings and they discussed 21 these are major issues, and not once would Cora 22 put it into the meeting notes. 23 So it was always from Apacheta's 24 perspective, only on what they could do. They 25 did not want to put it in writing what they Page 249 1 can't do. 2 Should it have been? They did send 3 e-mails out, they did address it. They did keep 4 bringing these up in meetings. And they 5 basically came back and said we don't have the 6 ability to do this. 7 Q I appreciate your opinion and thank 8 you for giving it to me. Let's go to a couple 9 quick topics and then we'll be done. 10 Actually, sticking with that before we 11 go off of it. Let's go back to Exhibit 14 12 that's somewhere in your stack. We looked at 13 this earlier. 14 This is an e-mail from -- it's a 15 couple of e-mails from Barnes Marshall of 16 August 28th and August 31st. 17 In the August 28th e-mail on page 1, 18 which is Apacheta 11406, Barnes reports to the 19 rest of the internal Lincare project team, the 20 subject is final operations, project sign-off, 21 that Apacheta has provided us with three project 22 spec documents, TransportAce, Transport Manager 23 and Integration. 24 Do you see that? 25 A Yes. 63 (Pages 246 - 249) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 64 of 68 Page 250 1 Q And those are the three documents that 2 are then again updated and provided by Cora on 3 October 5th, right? 4 A Yes. 5 Q And Barnes writes, "Those documents, 6 define the scope of the project and the 7 functionality and process flow of the tablet," 8 right? 9 A Yes. 10 Q I just don't get it. You come in just 11 about a month later, right? 12 A Uh-huh. 13 Q Yes? 14 A Yes. 15 Q And at this point in time, Barnes is 16 not saying that there's massive deficiencies in 17 any regard with regards to these functional 18 specifications, right? 19 A Right, but this is one segment. 20 Q In fact, he goes back to Cora on 21 August 31st, "You said you would have the 22 revised specs back to us by the 11th. I'm 23 trying to schedule an aggressive review on our 24 side for final sign-off." 25 So he's ready to go ahead with final Page 251 1 sign-off when the next revised version is 2 completed, right? 3 A Yes. 4 Q And he's not raising any of these bigs 5 issues that you've raised in your analysis in 6 mid-October? 7 A He had raised them. He's raised them 8 multiple times. 9 Q Yet, in his view, though, he's willing 10 to go forward with signing off the specs after 11 another set of revisions? 12 A Remember, the specs don't include the 13 areas of concern. They only include the screens 14 of the tablet. So it's specifically of the 15 tablet within the tablet. This is spec review 16 of a very specific part. 17 Q We'll talk with Barnes to see what he 18 meant and what his view was. Let's go to the 19 answer to the complaint, which you've got buried 20 there at the beginning of your exhibits. I want 21 to ask you some questions about that. 22 A What number was that? 23 Q Exhibit 4. So one of the topics in 24 the notice of deposition was Lincare's answer to 25 Apacheta's complaint. Another was the basis for Page 252 1 Lincare's affirmative defenses. Is that 2 something that you're factually to testify about 3 today? 4 A I'm sorry, what page are you on? 5 Q If you go back to the notice of 6 deposition, which we've marked at the very 7 beginning of the deposition, the first two 8 topics that I asked for testimony on today were, 9 one, the basis for Lincare's answers to 10 Apacheta's complaint and number 2, the basis for 11 Lincare's affirmative defenses. 12 From a factual perspective, are you 13 able to provide testimony about those things 14 today? 15 A I believe so. 16 Q So looking at Exhibit 4, which is 17 Lincare's answer with affirmative defenses, if 18 you look at the top, there's a header -- go to 19 page 9 of 12. And at the bottom of page 9, you 20 see the beginning of what's titled affirmative 21 defenses? 22 A Yes. 23 Q So flip to the next page, page 10. 24 Let's just go over a couple of things quickly. 25 Number 2 says, "Apacheta has been paid in full Page 253 1 for the work it performed." 2 We agree that Lincare never made a 3 payment for any software license fees, right? 4 A Correct. 5 Q Affirmative Defense Number 3 says, 6 "Lincare raises all defenses set forth in 7 Federal Rule of Civil Procedure 8(c) to 8 Apacheta's claims, including but not limited to 9 estoppel, failure of consideration, laches, 10 payment, release, res judicata, statute of 11 frauds, statute of limitations and waiver." 12 Are you able to tell me from a factual 13 perspective the basis, if any, for that 14 affirmative defense? 15 MR. LIPMAN: Objection. 16 MR. STAR: What's the objection? 17 MR. LIPMAN: The objection is these 18 are legal terms that she may or may not 19 understand. 20 MR. STAR: I'm not asking for a legal. 21 I'm asking from a factual perspective. 22 MR. LIPMAN: But if she doesn't 23 understand what the word laches means, for 24 example, she wouldn't be able to provide 25 any facts to support that. 64 (Pages 250 - 253) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 65 of 68 Page 254 1 MR. STAR: Well, she was asked to come 2 here today and testify about the basis for 3 the affirmative defenses. 4 MR. LIPMAN: Right. And I said that 5 in whole or in part she could address this 6 and she will try to answer any questions, 7 but for you to ask her whether she can 8 provide any factual support to legal terms 9 when you know -- 10 MR. STAR: She can say yes, no or I 11 don't know. 12 BY MR. STAR: 13 Q Go ahead. 14 A I don't understand the legal terms. 15 Q So you're not able to give me any 16 facts today? 17 A Not on this one. 18 Q The next one, 4, "Apacheta's 19 complaint, in whole or in part, fails to state a 20 claim against Lincare upon which relief can be 21 granted." 22 Are you aware of any facts that 23 support that affirmative defense? 24 MR. LIPMAN: The same objection. 25 A Again, I'm not clear on what the legal Page 255 1 term means. 2 BY MR. STAR: 3 Q Number 5, "Apacheta's claims are 4 barred and/or limited by the failure of Apacheta 5 to comply with statutory, contractual and/or 6 other conditions precedent to bringing this 7 action." 8 MR. LIPMAN: The same objection. 9 BY MR. STAR: 10 Q Are you aware of any failure by 11 Apacheta to comply with any statute that's 12 applicable here? 13 A Statute -- you would have to explain 14 statute. 15 Q I don't know. Your Affirmative 16 Defense Number says that? 17 MR. LIPMAN: I'm going to object. 18 This is clearly an attorney writing this. 19 She even testified before -- 20 MR. STAR: Are you going to produce an 21 attorney to testify as to the factual basis 22 for these defenses, or are you going to 23 withdraw them? 24 MR. LIPMAN: I'm not going to withdraw 25 these. Page 256 1 MR. STAR: Then they're not proper. 2 If they don't have a factual basis -- 3 MR. LIPMAN: Then file a motion. 4 MR. STAR: I'm going to get to filing 5 a motion by finishing my questions and then 6 I'll establish that you don't have any 7 basis for them and then they go away. 8 BY MR. STAR: 9 Q So number 5, are you aware of any 10 failure of Apacheta to comply with a statutory, 11 contractual or other condition precedent? 12 A No. 13 MR. LIPMAN: Objection. 14 BY MR. STAR: 15 Q No? Is that your answer? 16 A I'm -- I'm not clear on what this 17 legal term means. 18 MR. LIPMAN: Let's go off the record. 19 I may be able to make this easier for you. 20 MR. STAR: Wait a minute, I don't want 21 you to take a break and coach her. 22 MR. LIPMAN: I'm not going to coach 23 her. I may be able to stipulate to 24 something. 25 MR. STAR: Go ahead, but I don't want Page 257 1 you to take a break and having a 2 conversation with her. Now you're breaking 3 and having a conversation with her. 4 MR. LIPMAN: Yeah. I wanted to ask 5 her a question as to whether you and I can 6 reach a stipulation so we don't have to 7 waste time? 8 You don't want to do that? 9 MR. STAR: I don't know. 10 MR. LIPMAN: If we were able to reach 11 a stipulation, that the response to every 12 question is going to be the same, would 13 that be acceptable? 14 MR. STAR: If the response to every 15 question is that she's unaware of any facts 16 that support any of these affirmative 17 defenses, then sure. 18 MR. LIPMAN: That's not what her 19 answer is. Her answer is that she's not 20 aware -- 21 MR. STAR: Now you're going to give 22 her the answer. 23 MR. LIPMAN: She's already said that 24 she doesn't understand what the terms mean. 25 MR. STAR: Then I'm not cool with the 65 (Pages 254 - 257) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 66 of 68 Page 258 1 stipulation and let's keep going. Let's be 2 clear, I can't define the terms that you 3 guys put in your own answer. 4 You might know what they mean and you 5 haven't told your witness or you haven't 6 prepared her, but your obligation was to 7 prepare her today. 8 MR. LIPMAN: Greg, I'm going to 9 remember this. And when you put up your 10 corporate designee and I start asking 11 questions and that person doesn't know what 12 you meant. 13 MR. STAR: Let's do it. 14 MR. LIPMAN: You're just wasting 15 everyone's time and the court reporter is 16 getting $4.00 a page. 17 MR. STAR: You can leave if you want. 18 We'll continue. 19 BY MR. STAR: 20 Q Number 6 says, "Apacheta's claims are 21 barred and/or limited by the failure of Apacheta 22 to comply with the terms and conditions of the 23 contract documents." 24 So we've gone through a lot of that 25 today. Are you able to identify for me any Page 259 1 failure of Apacheta to comply with any term or 2 condition of the contract documents in this 3 case? 4 MR. LIPMAN: The same objection. 5 A It's a legal term that. . . 6 BY MR. STAR: 7 Q So you're unaware of anything that 8 would support Number 7 with regard to whether 9 Apacheta's damages are recoverable? 10 A It's a legal question. 11 Q Number 8 says, "Apacheta's claims must 12 be dismissed because Apacheta is estopped by its 13 conduct from bringing this action." 14 MR. LIPMAN: Wait for a question. 15 BY MR. STAR: 16 Q Are you aware of any fact that 17 supports that sort of defense? 18 MR. LIPMAN: The same objection. 19 A I don't understand the defense. 20 BY MR. STAR: 21 Q Has it been explained to you by legal 22 counsel what estoppel means? 23 MR. LIPMAN: Objection. Don't discuss 24 what we may have discussed. 25 BY MR. STAR: Page 260 1 Q Number 9, "Apacheta's claims must be 2 dismissed against Lincare by reason of waiver." 3 Are you aware of anything that Apacheta did to 4 so call waive any of its claims? 5 MR. LIPMAN: The same objection. 6 MR. STAR: Are you instructing her not 7 to answer? 8 A I don't understand legal terms. 9 BY MR. STAR: 10 Q Number 10 says, "Apacheta's claims are 11 barred, in whole or in part, to the extent that 12 any alleged claim or loss arises from Apacheta's 13 actions, omissions or other conduct that is or 14 was in violation of federal, state or local law, 15 statutes, regulations or public policy." 16 Ma'am, to your knowledge, did Apacheta 17 at any time in connection with this project 18 violate any federal, state or local law, 19 statute, regulation or public policy? 20 A I'm not aware. 21 Q Number 11 says, "Apacheta's claims are 22 barred, in whole or in part, to the extent that 23 any right to subrogation, indemnification, or 24 contribution has been impaired or prejudiced by 25 Apacheta." Page 261 1 I assume you're not aware of anything 2 that supports that? 3 A I don't understand those words. 4 Q Number 12, "Apacheta's claims are 5 barred by the terms and conditions, express or 6 implied, of the contract and/or the applicable 7 law." 8 Is there anything you can tell me that 9 supports that? 10 A I don't understand the legal term. 11 Q Number 13 says, "Apacheta's claims are 12 barred, in whole or in part, by its own breaches 13 or the relevant contract documents." 14 Are you aware of any breach by 15 Apacheta or anything in the relevant contract 16 documents that bars Apacheta's claims? 17 A I'm not aware of this terminology. 18 Q The same thing would be true with 19 respect to number 14, which says, "Apacheta's 20 claims are barred, in whole or in part, by 21 set-of?" 22 A I don't understand the legal term. 23 Q And 15 which says, "Apacheta's claims 24 are barred and/or limited by Apacheta's failure 25 to mitigate its damages? 66 (Pages 258 - 261) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 67 of 68 Page 262 1 A I don't understand the legal terms. 2 MR. STAR: Thank you for your time. 3 THE COURT REPORTER: Are you ordering? 4 MR. STAR: Yes. 5 THE COURT REPORTER: Do you want a 6 copy? 7 MR. LIPMAN: Yes. 8 (The deposition concluded at 3:40 9 p.m.) 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Page 263 1 CERTIFICATE OF OATH 2 STATE OF FLORIDA ) 3 COUNTY OF HILLSBOROUGH) 4 5 I, MARY ANN BROWNE, Notary Public, State of 6 Florida, certify that LINDA SHARON REID, 7 personally appeared before me on January 11, 8 2017 and was duly sworn. 9 10 WITNESS my hand and official seal January 11 27, 2017. 12 13 14 15 <%Signature%> _______________________________ 16 MARY ANN BROWNE Notary Public, State of Florida 17 MY COMMISSION FF 074984 EXPIRES 12/16/17 18 19 20 21 22 23 24 25 Page 264 1 CERTIFICATE OF REPORTER 2 3 STATE OF FLORIDA ) 4 COUNTY OF HILLSBOROUGH ) 5 6 I, MARY ANN BROWNE, Court Reporter, and 7 Notary Public, do hereby certify that I was 8 authorized to and did stenographically report 9 the foregoing deposition of LINDA SHARON REID, 10 that a review of the transcript was not 11 requested; and that the foregoing transcript, 12 pages 1 through 262, is a true record of my 13 stenographic notes. 14 15 I FURTHER CERTIFY that I am not a relative, 16 employee, or attorney, or counsel of any of the 17 parties' attorneys or counsel connected with the 18 action, nor am I financially interested in the 19 action. DATED January 27, 2017 at Tampa, 20 Hillsborough County, Florida. 21 22 23 <%Signature%> 24 _____________________________ MARY ANN BROWNE 25 Notary Public 67 (Pages 262 - 264) Veritext Legal Solutions 800-726-7007 305-376-8800 Case 2:16-cv-02030-BMS Document 20-3 Filed 02/14/17 Page 68 of 68 EXHIBIT C Case 2:16-cv-02030-BMS Document 20-4 Filed 02/14/17 Page 1 of 2 Case 2:16-cv-02030-BMS Document 20-4 Filed 02/14/17 Page 2 of 2 EXHIBIT D Case 2:16-cv-02030-BMS Document 20-5 Filed 02/14/17 Page 1 of 2 Case 2:16-cv-02030-BMS Document 20-5 Filed 02/14/17 Page 2 of 2 EXHIBIT E Case 2:16-cv-02030-BMS Document 20-6 Filed 02/14/17 Page 1 of 2 Case 2:16-cv-02030-BMS Document 20-6 Filed 02/14/17 Page 2 of 2 EXHIBIT F Case 2:16-cv-02030-BMS Document 20-7 Filed 02/14/17 Page 1 of 2 Case 2:16-cv-02030-BMS Document 20-7 Filed 02/14/17 Page 2 of 2 EXHIBIT G Case 2:16-cv-02030-BMS Document 20-8 Filed 02/14/17 Page 1 of 2 Case 2:16-cv-02030-BMS Document 20-8 Filed 02/14/17 Page 2 of 2 EXHIBIT H Case 2:16-cv-02030-BMS Document 20-9 Filed 02/14/17 Page 1 of 4 Case 2:16-cv-02030-BMS Document 20-9 Filed 02/14/17 Page 2 of 4 Case 2:16-cv-02030-BMS Document 20-9 Filed 02/14/17 Page 3 of 4 Case 2:16-cv-02030-BMS Document 20-9 Filed 02/14/17 Page 4 of 4