SAN JOSE, Calif. Pounding his fist during emotionally charged testimony in Avanti Corp.'s ongoing restitution hearing, the former chief executive officer of Cadence Design Systems Inc. said Avanti officials engaged in a "pattern of lying and cheating and stealing" while trying to personally disparage him during Cadence's seven-year legal battle over stolen database code.
"Every means justified the end" to Avanti officials, Joseph Costello said. "And then they attack me," Costello said, his voice cracking from emotional strain.
Costello's speech, which lasted about 10 minutes, capped a morning of cross examination by Avanti lawyer Darin Snyder on Wednesday (June 20) during the second day of Avanti's restitution hearing here at the Santa Clara County Superior Court.
Costello grew more combative as Snyder tried to cast doubt on the importance of the Simbad database code that Avanti had misappropriated from Cadence, and to Snyder's suggestion that Cadence may have signed away Avanti's liability.
During questioning, Snyder asked Costello to identify the most important criteria for semiconductor companies when evaluating place and route tools, to which Costello answered achieving the best die size, speed and power. Snyder took that as an opening. "The database doesn't have any effect on any of these," Snyder said.
"That's where you miss the point," Costello shot back. "It's a fundamental piece of the place and route tool. That's like saying that gasoline doesn't have any effect on the speed of the car."
Later, Snyder asked Costello about the "release" language of the settlement agreement Cadence had signed with Avanti president and chief executive officer Gerry Hsu after Hsu bolted Cadence to become president of Avanti. Avanti lawyers have cited language in the settlement agreement as evidence that Avanti's liability for the stolen code is limited.
Costello, however, said he had agreed to the settlement only reluctantly, and that Hsu went on to break the agreement by talking to Cadence employees when he wasn't supposed to. Snyder pressed him to consider some specific wording in the agreement, but Costello resisted. "You're the lawyer; don't ask me to interpret it," Costello said.
Judge Conrad Rushing appeared sympathetic to Costello. "This is a document not prepared by him but by some lawyers for him," Rushing said.
Later, Rushing asked lawyers for both sides to prepare arguments by Thursday (June 21) to establish whether the language of the settlement agreement exonerates Avanti. Lawyers for the prosecution and Cadence said that the settlement is a civil matter that shouldn't be applied to a criminal case and that Cadence did not know Avanti was using the stolen code when the agreement was reached. Avanti officials last month pleaded no contest to stealing the code from Cadence.
Following the questioning, Rushing granted a request by Costello to describe his seven-year experience with the Avanti case.
"There was a pattern of lying and cheating and stealing, and then lying about the stealing and cheating," Costello said.
Costello pinned most of the blame on Avanti president and CEO Hsu, who Costello said left Cadence for Avanti after being passed up for promotion. Hsu then wooed some of Cadence's best engineers, Costello said.
Costello said that Mitch Igusa, who faces jail time for stealing code from Cadence, was "warped" by Hsu's influence. Costello said he was incredulous that Igusa then went on to work as a consultant for Avanti.
"That took balls, your honor, to take a guy that has been nailed and hire him," Costello said.Following Costello, Cadence lawyers called on former Cadence vice president of marketing Jim Douglas to describe how Avanti was able gain market share as a result of the misappropriated Simbad database.
"Avanti was able to get better ease-of-use because they didn't have to develop the database," Douglas said.
This ease-of-use and Avanti's practice of charging significantly less than Cadence helped Avanti nab top-tier customers in the early to mid '90s, Douglas said. These included Motorola, Matsushita, Mitsubishi, Sun, Texas Instruments, Siemens now Infineon, Analog Devices, Lucent and C-Cube, Costello said.
But at one point Rushing questioned Douglas' declaration. "The conclusion you might draw is that Avanti were better at marketing," Rushing said.