Western Digital 2002 Annual Report Download - page 48

WESTERN DIGITAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Ì (Continued)
Future minimum rental payments under non-cancelable operating leases as of June 28, 2002 are as follows (in
thousands):
2003 ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $10,131
2004 ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 8,213
2005 ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 7,061
2006 ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 7,004
2007 ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 5,508
ThereafterÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 19,559
Total future minimum rental payments ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $57,476
Note 5. Legal Proceedings
The following discussion contains forward-looking statements within the meaning of the federal securities laws.
These statements relate to the Company's legal proceedings described below. Litigation is inherently uncertain and may
result in adverse rulings or decisions. Additionally, the Company may enter into settlements or be subject to judgments
that may, individually or in the aggregate, have a material adverse eÅect on the Company's consolidated Ñnancial
position, results of operations or liquidity. In addition, the costs of defending such litigation, individually or in the
aggregate, may be material, regardless of the outcome. Accordingly, results could diÅer materially from those projected in
the forward-looking statements.
In the normal course of business, the Company is subject to legal proceedings, lawsuits and other claims, including
proceedings under laws and government regulations related to environmental, labor, product and other matters. The
ultimate aggregate amount of monetary liability or Ñnancial impact with respect to these matters at June 28, 2002, is
subject to many uncertainties and is therefore not predictable with assurance. While these matters could aÅect the
operating results of any one quarter when resolved in future periods, management believes that, after Ñnal disposition, any
monetary liability or Ñnancial impact to the Company from these matters, beyond that provided at June 28, 2002, would
not be material to the annual consolidated Ñnancial statements. However, there can be no assurance with respect to such
result. Where deemed advisable, the Company may seek or extend licenses or negotiate settlements. Although patent
holders often oÅer such licenses, no assurance can be given that in a particular case a license will be oÅered or that the
oÅered terms will be acceptable to the Company.
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 appealed the judgment and the judgment awarding costs
and attorney's fees to the Company. The Company and Amstrad have entered into a settlement agreement settling all
claims between them relating to the litigation, and dismissals of the appeals will be entered shortly.
In June 1994, Papst Licensing (""Papst'') brought suit against the Company in the United States District Court for
the Central District of California, alleging infringement by the Company of Ñve disk drive motor patents owned by Papst.
In December 1994, Papst dismissed its case without prejudice. In July 2002, Papst Ñled a new complaint against the
Company and several other defendants. The suit alleges infringement by the Company of seventeen of Papst's patents
related to disk drive motors that the Company purchased from motor vendors. Papst is seeking an injunction and
damages. The Company Ñled an answer on September 4, 2002, denying Papst's complaint. The Company intends to
vigorously defend the suit.
On July 5, 2001, the Company (and its Malaysian subsidiary) Ñled suit against Cirrus Logic, Inc. (""Cirrus'') in
California Superior Court for the County of Orange for breach of contract and other claims resulting from Cirrus' role as a
strategic supplier of read channel chips for the Company's hard drives. The Company also stopped making payments to
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