Kalkhoven testimony delayed.

by Lynne Huntting

Although defendant Kevin Kalkhoven KALKHOVEN was slated to give testimony on Wednesday in Oakland District Court in the class action civil jury trial, one of his co-defendants, Charles Abbe, was on the stand the entire session, and is expected to complete his testimony Thursday morning.

Then the Plaintiffs will continue the testimony of Kerry Dehority, who started Tuesday and was put over until Thursday. Kalkhoven, co-owner of the Champ Car World Series and also co-owner of PKV Racing and Cosworth engines, is expected to begin his testimony later Thursday. His testimony could continue on Friday.

After Kalkhoven is through testifying, the defence attorneys will call Mr. Kleidon, a damages expert, and Mr. Neagoy. The plaintiffs have already indicated they will probably recall a previous witness, Dr. Scott Hakala as a rebuttal damages expert. The four defendants - Abbe, Kalkhoven, Robert Mueller and Josef Strauss, are former executives of JDS Uniphase, and are alleged to have committed violations of the Securities and Exchange Commission - insider trading. Each defendant has different allegations, and if any or all are found to be true, the jury will also have to assess damages.

If all goes according to the schedule planned by Judge Claudia Wilkins, she may give jury instructions (charge the jury on the law) on Friday. Plaintiffs will begin their closing arguments Monday, followed by defence summation. Court is scheduled to break for Thanksgiving holidays on Wednesday and return the following Monday.

Wednesday, Abbe, former COO at JDSU, was examined by the Lead attorney of his legal team, Terry Garland. Among his JDSU responsibilities was strategy and implementing the organization for the FY01 Annual Plan. Much of the direct examination went to how and when he gained the information and how it was used. He was also cross examined by the Plaintiffs legal team, and that will continue Thursday.

Many demonstratives (exhibits) were shown with lots of facts, figures and copies of teleconference transcripts. Much was made of the information provided in periodic reports, and whether JDSU was giving accurate information on the state of its company, and of some of its top customers including Nortel and Lucent. Testimony was given as to when and why they were building inventory and backlogs.

Abbe sold $11 million of JDSU stock in 2000, in the August open window. This was three days after a JDSU Sales Flash report which reflected the information Abbe said was known at the time including cancellation of orders and delayed orders. He said that the sales information in the document was true, and that he was not aware of any information not provided to the public, and had no inside information. Abbe said he had underlying confidence in the company that things would improve.

Abbe said he was shocked by the Nortel news release on 15 February 2001 regarding its top line growth being below analysts expectations. On 27 February 2001, after consulting with JDSU counsel on defining conditions under which he could sell stock (the price had to be $30 or better per share), Abbe sold some more JDSU stock.