NDS Operational Security chief Reuven Hasak on how Ray Adams’ hard drive went missing, and his plan to sue him immediately after the 2008 EchoStar trial. (This does not appear to have occurred). Given the strength of Hasak’s comments it would be very surprising then if any branch of News Corporation or its associates had ever provided financial or other assistance to Adams, directly or indirectly, after his departure from NDS in May 2002.

Testimony by Reuven Hasak before the United States District Court, Central District of California, Southern Division  in Echostar Satellite Corp et al vs NDS Group Plc

April 30, 2008

Counsel for NDS Darin Snyder

Witness:  Reuven Hasak

Before Judge David O. Carter

 Q.   And are you aware that at some point a hard drive containing NDS materials disappeared from NDS?

A.   Yes.

Q.   Okay.  How did that hard drive disappear?

A.   When Ray Adams, who used to be the head of our UK team, retired or resigned, I asked Len Withall, who replaced him, to get from him all the equipment belonged to NDS, especially laptop, cell phone, et cetera.  So Len went and called Ray Adams and told him that he needs it, and Ray told him to — sorry — to come to his home in Windsor, England and to pick it up.

Q.   What did Mr. Withall do?

A.   He went to Windsor, he visited Ray Adams in his home, he got the laptop, and he went back to the office in Maidenhead.

Q.   What did NDS discover when it examined the laptop? A.   Andy Coulthurst, C-O-U-L-T-H-U-R-S-T, was the technician.  Andy got this laptop, and he told Ray that something is wrong here because the hard drive inside is either corrupted or deleted, erased.

Q.   Did NDS follow up with Mr. Adams?

A.   Yes.  At the same day or same moment, even, Len called Ray Adams and told him that “You are fooling me.”

And Ray said, “Yeah, because I wanted to keep the other hard drive because I had some family pictures there.  So come by, and I’ll give you the original hard drive.”

Q.   Okay.  What did Mr. Withall do then?

A.   The next morning Mr. Withall then went back to Windsor.

Q.   Was he able to get the hard drive?

A.   No.  Because, surprisingly, Mr. Adams told him that the last night the hard drive was stolen from him.  He said that he kept the hard drive in the car, in his wife’s car.  And, surprisingly, last night the car was broken in — burglared, and they stole a couple of things from the car including the hard drive.  He found other things in the neighborhood, but he did not find the hard drive.

Q.   So Mr. Withall wasn’t able to get the hard drive?

A.   He was not able, and he told Ray that he’s a liar.

Q.   Mr. Withall told Ray Adams he was a liar?

A.   Yes.

Q.   Did NDS do anything to follow up on the disappearance of that hard drive?

A.   We are looking, and we distributed the information that the hard drive is missing to see if it will surface in the pirate community.  And we were hoping that the police will do something.  But because the complaint was submitted to the police by Ray —

Q.   Who submitted a complaint to the police?

A.   Ray, Ray Adams.

Q.   Did NDS submit a complaint to the police?

A.   No.

Q.   Why not?

A.   Because according to the rule in the UK — I checked it then — and they said, “The rules in our country, you cannot submit two complaints.”  If we have a problem, for example, in Israel that the laptop is stolen from an employee, he should submit the complaint, not us.  He should submit the complaint because the laptop, for an example, was under his responsibility.  So he should prepare the complaint.

Q.   Did NDS check to determine whether or not Mr. Adams had filed a complaint with the police?

A.   No.  I asked Len to check it, and he said he cannot. The police will not respond to him if he would check about other complaints.

Q.   Does Mr. Withall have experience with law enforcement in the UK?

A.   Correct.

Q.   What kind of experience does Mr. Withall have?

A.   I think for 30 years he was an officer with the police.

Cross-examination by Chad Hagan, Counsel for EchoStar

 BY MR. HAGAN: Q   Mr. Hasak, you’re — you’re aware that your company has made some allegations that Ray Adams’s hard drive was stolen and the information contained on that hard drive was stolen, correct?

A   Stolen from NDS, yeah.

Q   You don’t believe, though, sir — as you testified at your deposition, you don’t believe that either EchoStar or NagraStar had any involvement in stealing that hard drive, correct?

A   No, I don’t think I did — I did say so, I said that they didn’t have any — any proof that it was done.

Q   Okay.  And if — if I understood your testimony on direct examination, you don’t even believe that that hard drive was stolen from Mr. Adams’s car; is that correct?

A   From Mr. Adams?  From — yes, I don’t believe it.

Q   Do you believe that Mr. Adams distributed that information on his own?

A   Yes.

Q   Do you think that Mr. Adams was acting as a whistle-blower to expose NDS’s involvement in the piracy of Canal+ and EchoStar?

A   You have to repeat your question.

Q   You testified that you believe Mr. Adams distributed those documents in the hard drive himself, correct?

A   He gave it to somebody, yeah.

Q   And prior to him leaving NDS, he was the head of security for the United Kingdom, correct?

A   Correct.

Q   Now, do you believe that Mr. Adams distributed those materials as a whistle-blower to expose NDS’s involvement in the piracy of the Canal system and the EchoStar system?

A   For me, a whistle-blower is a positive term.  I don’t think that Mr. Adams was a whistle-blower.

Q   Did NDS ever sue Mr. Adams based on his disclosure of these documents?

A   I don’t know.

Q   Did — and you testified that your company never filed a police report about the stolen laptop, correct?

A   Yeah, but I explained why.

Q   Did you ever follow up with the authorities on that?

A   Authorities?  What do you — Q   Any of the authorities.

A   No, but the only thing I said was that after we are over with this trial, I am going to sue him, yes.

Q   And other — THE COURT:  Just a moment. I don’t think we got that.

Would you repeat your answer, sir?

THE WITNESS:  Yes.  That I said that after we are finished with this case, I am going to go after Ray Adams and sue him, yes.

THE COURT:  Okay.

BY MR. HAGAN: Q   And when did Mr. Adams report that his hard drive was taken out of his laptop and out of his car; what year was that?

A   2002, I think; no?

Q   2002, the best that you can recall?

A   You know that I’m not very good in year.  We know each other already, so I think it’s 2002.

Q   It — it’s been more than — A   When he retired, okay?

Q   And we’ll go back to his retirement in a minute, but just right now I am trying to establish the time frame for the jury.  It’s been more than half a decade; fair?

A   Half a decade?

Q   Since Mr. Adams said his laptop was — or hard drive was taken — A   Oh, more than half a decade, yes, six years ago.

Q   Now, other than those documents being distributed to Canal+ and to EchoStar and used in the litigation against NDS, has your company been damaged in any other way by the distribution of those documents?

A   Yes.

Q   How?

A   First of all, it included many documents referring to anti-piracy.  And I have mentioned before, exposing our modus operandi, exposing our names, exposing our agent, our informants, et cetera, it’s a big dimension.  It puts people under risk.

Secondly, Ray Adams had in his possession, also, all kind of marketing and other communications with people within NDS.

Q   Can you identify any specific instance where one of those marketing documents were — were used in a way to injure NDS?

A   Market — marketing papers, sensitive information belongs to NDS, so why to show it to others, sure.

Q   So it — it could cause damage, but you are not aware of any specific instance?

A   I am not aware of any specific, but in general, I can tell you that it’s a damage, yes.

Q   Now, you said a moment ago that Mr. Adams retired from NDS; is that correct?

A   Yes, yes.

Q   Isn’t it true, sir, that he was forced out of the company?

A   (No audible response.) Q   Isn’t it true, Mr. Hasak, that Ray Adams was forced out of the company?

A   No.

Q   Isn’t it true that Mr. Adams was forced out of the company, because he knew of NDS’s involvement in the publication of the Canal code on Mr. Menard’s website?

A   Wrong.

Q   Isn’t it true that he was forced out of the company after Oliver Kommerling gave a declaration in the Canal+ lawsuit?

A   No, I told you that he was not forced out.

Q   Let’s take a look at Exhibit 624. Now, this is an e-mail exchange between you and Mr. Adams, among other people, correct?

A   Yes.

MR. HAGAN:  Your Honor, I move Exhibit 624 into evidence.

THE COURT:  Any objection?

MR. SNYDER:  No objection.

THE COURT:  Received.

(Plaintiffs’ Exhibit No. 624 is received into evidence.) BY MR. HAGAN: Q   Now, on the bottom portion of page 1 is an e-mail from you dated May 2nd, 2002, correct?

A   Yes, yes.

Q   And you’re sending that e-mail to a number of NDS employees?

A   Yes.

Q   And in that e-mail you state, “Ray Adams, the head of the UK operational team, expressed his wish to retire on May 2002”; is that correct?

A   Yes.

Q   And then Mr. Adams responded to this e-mail, and that’s the e-mail that we have at the top.  And in his response, he says, “Announcements of my retirement are premature”; do you see that?

A   Yes.

Q   What was Mr. Adams referring to when he said announcements of his retirement are premature?

A   To my note, to my e-mail.

Q   Now, did there come a time when there was a dispute about — A   Excuse me.  Do you leave this paper?  Now, we are done with this, with this paper?

Q   Yes, sir, we’re done.

A   I want to tell you that he is lying here.

Q   Okay.  I — A   — in this paper.  You showed me the paper, and he writes here that I was going to meet him.  It’s a full lie.

Q   You don’t believe that Mr. Adams is an honest person, correct?

A   No, I don’t believe so.

Q   And you didn’t believe that he was an honest person in 1997 when he was sending you those memorandums, correct?

A   No.  I thought that he was a big politician and manipulation — manipulator.  Today I know that he is not an honest person.

Q   And besides your opinion that Mr. Adams was a manipulator and he was sending you reports that included language that you considered “blah, blah, blah,” you never terminated his employment, and that employment didn’t end until 2002, correct?

A   I took the simple steps, and then I was tolerate with him, because he — he was holding — Oliver Kommerling was a big asset to us.

Q   Now, after Mr. Adams departed from the company, there was a dispute about his department, correct?

A   Between the lawyers.

Q   Now, let’s take a look at Exhibit 626.

24      This is a letter from Mr. Adams’s counsel, Nabarro Nathanson (phonetic), dated May 21st, 2002.

A   Yes.

Q   Which is a couple weeks after you sent the e-mail saying Ray Adams expressed a wish to retire from the company, correct?

A   Yes.

Q   And in this letter from Mr. Adams’s counsel, it states “The position was compounded by the issues which were raised by the company at the meeting with our client” — A   I — Q   — “on May 13th” — A   I have to find it.

Q   Sure.

13      It’s on the first page, the third paragraph down.

A   Third paragraph?

Q   Yes, sir.

A   Yes.

Q   It says “The position was compounded by issues which were raised by the company at the meeting with our client on 13 May, 2002.” A   What does it mean “the position was compounded”?

Q   We’re getting there.

A   Okay.

Q   “In particular, the company’s completely unacceptable threat to our client, that unless he resigned, the company would implement its disciplinary procedure against our client on grounds which are nothing short of spurious and without foundation.”  3      Now, do you understand that language to be referring to the dispute between NDS and Mr. Adams when he left the company?

A   It’s the dispute between the lawyers, yes.

Q   And you understand from reading that language that Mr. Adams’s position, consistent with what he said in his e-mail, Exhibit 624, was that he was being forced out of the company, not voluntarily retiring, correct?

A   No, I don’t think I agree with the fact that — to say that he was forced out.

MR. HAGAN:  Your Honor, we offer Exhibit 626.

THE COURT:  Any objection?

MR. SNYDER:  No objection.

THE COURT:  Received.

(Plaintiffs’ Exhibit No. 626 is received into evidence.)