Western Digital 2001 Annual Report Download - page 55

WESTERN DIGITAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Ì (Continued)
Future minimum rental payments under non-cancelable operating leases as of June 29, 2001 are as
follows (in thousands):
2002 ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $19,368
2003 ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 8,614
2004 ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 7,116
2005 ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 6,144
2006 ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 6,034
Thereafter ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 19,855
Total future minimum rental payments ÏÏÏÏÏÏÏÏÏÏÏÏÏ $67,131
Legal Proceedings
In 1992 Amstrad plc (""Amstrad'') brought suit against the Company in California State Superior Court,
County of Orange, alleging that disk drives supplied to Amstrad by the Company in 1988 and 1989 were
defective and caused damages to Amstrad of not less than $186 million. The suit also sought punitive
damages. The Company denied the material allegations of the complaint and Ñled cross-claims against
Amstrad. The case was tried, and in June 1999 the jury returned a verdict in favor of Western Digital.
Amstrad has appealed the judgment. The Company does not believe that the outcome of this matter will have
a material adverse eÅect on its consolidated Ñnancial position, results of operations or liquidity.
In 1994 Papst Licensing (""Papst'') brought suit against the Company in federal court in California
alleging infringement by the Company of Ñve of its patents relating to disk drive motors that the Company
purchased from motor vendors. Later that year Papst dismissed its case without prejudice, but it has notiÑed
the Company that it intends to reinstate the suit if the Company does not enter into a license agreement with
Papst. Papst has also put the Company on notice with respect to several additional patents. The Company does
not believe that the outcome of this matter will have a material adverse eÅect on its consolidated Ñnancial
position, results of operations or liquidity.
In June 2000 Discovision Associates (""Discovision'') notiÑed the Company in writing that it believes
certain of the Company's hard disk drive products may infringe certain of Discovision's patents. Discovision
has oÅered to provide the Company with a license under its patent portfolio. The Company is in discussion
with Discovision regarding its claims. There is no litigation pending. The Company does not believe that the
outcome of this matter will have a material adverse eÅect on the Company's consolidated Ñnancial position,
results of operations or liquidity.
On June 9, 2000, a suit was brought against the Company in California Superior Court for the County of
Orange on behalf of a class of former employees of the Company who were terminated as a result of a
reduction in force in December 1999. The complaint asserted claims for unpaid wages, fraud, breach of
Ñduciary duty, breach of contract, and unfair business practices. The Company removed the suit to United
States District Court, Central District of California, on the ground that all of the claims are preempted by the
Employee Retirement Income Security Act of 1974. On January 26, 2001, the Company Ñled a motion to
dismiss plaintiÅs' complaint under Federal Rule of Civil Procedure 12(b). The Court granted the Company's
motion with leave to amend on April 2, 2001. PlaintiÅs Ñled an amended complaint on April 6, 2001, and the
Company Ñled a motion to dismiss the amended complaint under Federal Rule of Civil Procedure 12(b) on
June 4, 2001. The Court granted the Company's motion and dismissed plaintiÅs' amended complaint with
prejudice on August 6, 2001. On September 5, 2001, the Court entered a stipulated order according to which
plaintiÅs agreed to waive their right to appeal the Court's order dismissing their claims in exchange for the
Company's agreeing to waive its right to costs and fees as the prevailing party under ERISA.
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