0001
` 1 IN THE UNITED STATES DISTRICT COURT
` NORTHERN DISTRICT OF ILLINOIS
` 2 EASTERN DIVISION
` 3
` 4 TRADING TECHNOLOGIES )
` INTERNATIONAL, INC., )
` 5 )
` Plaintiff, )
` 6 )
` vs. ) Case No. 04 C 5312
` 7 )
` eSPEED, INC., )
` 8 )
` Defendant. )
` 9
`10 Deposition of ATSUSHI KAWASHIMA, taken before
`11 JAIME T. TRAMONTANA, C.S.R., and Notary Public,
`12 pursuant to the Federal Rules of Civil Procedure for
`13 the United States District Courts pertaining to the
`14 taking of depositions, at ABC Building, 11F,
`15 2-6-3 Skibakoen, Minato-ku, Tokyo, at 9:31 a.m. on
`16 the 21st day of November, 2005.
`17
`18
`19
`20
`21
`22
`23
`24
`
`
`TDA 1010
`CBM of U.S. Patent No. 7,676,411
`
`
` 1 IN THE UNITED STATES DISTRICT COURT
` NORTHERN DISTRICT OF ILLINOIS
` 2 EASTERN DIVISION
` 3
` 4 TRADING TECHNOLOGIES )
` INTERNATIONAL, INC., )
` 5 )
` Plaintiff, )
` 6 )
` vs. ) Case No. 04 C 5312
` 7 )
` eSPEED, INC., )
` 8 )
` Defendant. )
` 9
`10 Deposition of ATSUSHI KAWASHIMA, taken before
`11 JAIME T. TRAMONTANA, C.S.R., and Notary Public,
`12 pursuant to the Federal Rules of Civil Procedure for
`13 the United States District Courts pertaining to the
`14 taking of depositions, at ABC Building, 11F,
`15 2-6-3 Skibakoen, Minato-ku, Tokyo, at 9:31 a.m. on
`16 the 21st day of November, 2005.
`17
`18
`19
`20
`21
`22
`23
`24
`
`
`TDA 1010
`CBM of U.S. Patent No. 7,676,411
`
`
`
`LEGALINK - CHICAGO
`0002
` 1 There were present at the taking of this
` deposition the following counsel:
` 2
` McDONNELL BOEHNEN HULBERT & BERGHOFF, LLP by
` 3 MR. MATTHEW J. SAMPSON
` MR. LEIF R. SIGMOND, JR.
` 4 300 South Wacker Drive
` Chicago, Illinois 60606
` 5 (312)913-0001
` 6 on behalf of the Plaintiff;
` 7 VP TRADING TECHNOLOGIES
` MR. STEVEN F. BORSAND
` 8 222 South Riverside Plaza
` Suite 1100
` 9 Chicago, Illinois 60606
` (312)476-1018
`10
` on behalf of the Plaintiff;
`11
` WINSTON & STRAWN, LLP by
`12 MR. RAYMOND C. PERKINS
` MR. ANDREW JOHNSTONE
`13 35 West Wacker Drive
` Chicago, Illinois 60601
`14 (312)558-5860
`15 on behalf of the Defendant;
`16 MORRISON FOERSTER
` MR. PETER J. STERN
`17 AIG Building
` 11th Floor
`18 1-3 Marunouchi 1-Chome
` Chiyoda-Ku, Tokyo 100-0005, Japan
`19 (81)3214-6522
`20 on behalf of the Tokyo Stock Exchange;
`21 DOWELL BAKER
` MR. GEOFFREY A. BAKER
`22 29 Randolph Street
` Oak Park, Illinois 60302
`23 (708)660-1413
`24 on behalf of
`
`
`
`
`LEGALINK - CHICAGO
`0003
` 1 AOYAMA & PARTNERS
` MR. NOBUO IIDA
` 2 IMP Building
` 1-3-7, Shiromi, Chuo-ku
` 3 Osaka 540-0001 Japan
` (81)6-6949
` 4
` 5 Also present:
` 6 Mr. Bruce Holcombe,
` Japanese Interpreter;
` 7
` Ms. Yoshiko Iga,
` 8 Japanese Interpreter;
` 9 Ms. Akiko Tomita,
` Japanese Interpreter;
`10
` Malcoto Minoguchi;
`11
` Yuhei Oba.
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`
`
`
`
`LEGALINK - CHICAGO
`0004
` 1 I N D E X
` 2
` 3 WITNESS
` 4 ATSUSHI KAWASHIMA
` 5
` 6 EXAMINED BY PAGE
` 7 Mr. Perkins 5
` 8 Mr. Sampson 74
` 9
`10 EXHIBITS
`11
` Defendant's Exhibit No. 178 5
`12
` Defendant's Exhibit No. 179 9
`13
` Defendant's Exhibit No. 180 28
`14
` Defendant's Exhibit No. 181 37
`15
` Defendant's Exhibit No. 182 50
`16
` Defendant's Exhibit No. 183 60
`17
` Defendant's Exhibit No. 184 69
`18
` Defendant's Exhibit No. 185 70
`19
` TSE Exhibit No. 1 77
`20
` TSE Exhibit No. 2 108
`21
` TSE Exhibit No. 3 114
`22
`23
`24
`
`
`
`
`LEGALINK - CHICAGO
`
`0005
` 1 ATSUSHI KAWASHIMA,
` 2 called as a witness herein, having been first duly
` 3 sworn, was examined upon oral interrogatories and
` 4 testified as follows:
` 5 EXAMINATION
` 6 by Mr. Perkins:
` 7 Q Good Morning. Could you please state your
` 8 name?
` 9 A (Through interpreter) Atsushi Kawashima,
`10 A-t-s-u-s-h-i K-a-w-a-s-h-i-m-a.
`11 Q If at any time you do not understand my
`12 question, please let know and I will repeat or
`13 rephrase the question. Do you agree to do that?
`14 A Yes, I do.
`15 Q Are you currently employed?
`16 A Yes, I am.
`17 Q Where are you employed?
`18 A Tokyo Stock Exchange.
`19 Q How long have you been employed by the
`20 Tokyo Stock Exchange?
`21 A About 15 years I think.
`22 Q I have marked in front of you the
`23 Amended Commission to take the deposition here in
`24 Japan which I've marked as Exhibit 178. There are
`
`
`
`
`LEGALINK - CHICAGO
`0006
` 1 several topics set forth in this commission. Are you
` 2 prepared to answer those questions on behalf --
` 3 strike the -- strike the -- Strike the question.
` 4 Showing you what I've marked as
` 5 Defendant's Exhibit 178, which is the Amended
` 6 Commission to take the deposition here in Japan,
` 7 there are several topics identified in that
` 8 commission. Are you prepared to answer questions
` 9 about those topics on behalf of the Tokyo Stock
`10 Exchange?
`11 A Yes.
`12 Q What is your current position at the Tokyo
`13 Stock Exchange?
`14 A I'm in the derivative trade monitoring
`15 section.
`16 MS. IGA: (Japanese translation.)
`17 THE INTERPRETER: I'm sorry, I'm general --
`18 general -- senior manager for the derivative trade
`19 markets.
`20 MR. PERKINS: Q And what are your duties and
`21 responsibilities in that position?
`22 A (Through interpreter) I monitor Japan
`23 government bond futures and Japan government bond
`24 futures trading.
`
`
`
`
`LEGALINK - CHICAGO
`0007
` 1 MS. IGA: May I just -- option?
` 2 THE INTERPRETER: Oh, futures options trading.
` 3 Thank you. Accepted.
` 4 MR. PERKINS: Q How long have you been in that
` 5 position?
` 6 A (Through interpreter) It's two years.
` 7 MS. IGA: Two and a half year.
` 8 THE INTERPRETER: Two years.
` 9 MR. PERKINS: Q What was your position at the
`10 Tokyo Stock Exchange before that?
`11 THE INTERPRETER: Sorry, did you ask about his
`12 position or his job?
`13 MR. PERKINS: What his position was.
`14 THE WITNESS: (Through interpreter) You mean
`15 my -- my position prior to the present one?
`16 MR. PERKINS: Q That is correct.
`17 A (Through interpreter) I was previous to that
`18 a senior manager in the stock section.
`19 Q How long were you in that position?
`20 A It was for a year and a half.
`21 Q And what were your duties and
`22 responsibilities in that position?
`23 A I was in charge of margin -- managing margin
`24 trading at the TSE.
`
`
`
`
`LEGALINK - CHICAGO
`0008
` 1 THE REPORTER: Margin what?
` 2 THE INTERPRETER: Margin trading.
` 3 MR. PERKINS: Q What was your position at the
` 4 TSE before that?
` 5 A (Through interpreter) Before that I was in
` 6 general affairs.
` 7 Q How long were you in that position?
` 8 A That was one year.
` 9 Q Duties and responsibilities in that position?
`10 A It was the same as when I was in the
`11 management planning section. Work related to
`12 tie-ups.
`13 Q What was your position before that one at the
`14 TSE?
`15 A Prior to that I was in the operations systems
`16 section.
`17 Q How long were you in that position?
`18 A Five years.
`19 Q What were your duties and responsibilities in
`20 that position?
`21 A I was involved in the management and
`22 development of the TSE futures options trading
`23 system.
`24 Q I'm going to show you what I have marked as
`
`
`
`
`
`
`LEGALINK - CHICAGO
`0009
` 1 Exhibit 179.
` 2 THE INTERPRETER: Thank you, very much.
` 3 MR. PERKINS: Q Which is Bates stamped TSE 647
` 4 through 810. Can you identify this document for us,
` 5 please? Let me strike the question and reask the
` 6 question.
` 7 Showing what you I've marked as
` 8 Defendant's Exhibit 179, which is Bates stamped
` 9 TSE 647 through 995, can identify this for us,
`10 please?
`11 MR. STERN: Counsel, is this one document?
`12 MR. PERKINS: Yes.
`13 MR. STERN: I don't believe it is actually.
`14 MR. PERKINS: Okay. But the witness can tell us.
`15 THE INTERPRETER: So we go back to the original
`16 question? Do you want him to identify it?
`17 MR. PERKINS: Yes. Off the record.
`18 (Discussion off the record.)
`19 MR. PERKINS: Q Showing you what we marked as
`20 Defendant's Exhibit 179, which is Bates stamped
`21 TSE 647 through 981, can you identify this document
`22 for us, please?
`23 MR. STERN: If you want to take a moment to look
`24 at the document, you can.
`
`
`
`
`
`
`
`LEGALINK - CHICAGO
`0010
` 1 THE WITNESS: (Through interpreter) This document
` 2 is the current TSE futures options trading system
` 3 terminal document, manual. Manual.
` 4 THE INTERPRETER: Please let me rephrase it.
` 5 This is document is the current futures options
` 6 trading system -- trade manual.
` 7 MS. IGA: Terminal.
` 8 THE INTERPRETER: Trading terminal. Thank you
` 9 very much. Terminal. Manual trading terminal.
`10 MR. PERKINS: Q Do you know when this document
`11 was prepared?
`12 A (Through interpreter) In 1998.
`13 Q If we can turn to the page that is
`14 Bates stamped TSE 651? And at the bottom of the
`15 page, is there a date there?
`16 A Yes.
`17 Q And what is that date?
`18 A It's August of 1998.
`19 Q And was this document prepared on or around
`20 August of 1998?
`21 A Yes.
`22 Q And was this manual prepared by the Tokyo
`23 Stock Exchange?
`24 A Yes.
`
`
`
`
`LEGALINK - CHICAGO
`0011
` 1 Q Do you know who at the Tokyo Stock Exchange
` 2 prepared this document?
` 3 A I was in charge of preparing this document.
` 4 Q And was this 1998 manual prepared in the
` 5 ordinary course of business at the Tokyo Stock
` 6 Exchange?
` 7 A Yes.
` 8 Q Is it the regular practice of the Tokyo Stock
` 9 Exchange to create manuals of its -- of this type?
`10 A Yes.
`11 Q And was this manual prepared as part of the
`12 regular practice of the Tokyo Stock Exchange to
`13 prepare manuals of this type?
`14 A Yes.
`15 Q And was this 1998 manual maintained in the
`16 ordinary course of business at the Tokyo Stock
`17 Exchange?
`18 THE INTERPRETER: Counsel, when you say
`19 maintained, do you mean after being drafted, updated
`20 or?
`21 MR. PERKINS: Q Okay. I mean was this document
`22 in this form kept in the ordinary course of business?
`23 Was it stored in the ordinary course of business?
`24 A (Through interpreter) Yes.
`
`
`
`
`LEGALINK - CHICAGO
`0012
` 1 Q And has this 1998 manual been maintained in
` 2 the records of the Tokyo Stock Exchange since it's
` 3 been prepared?
` 4 A Yes.
` 5 Q What is the purpose of this 1998 manual?
` 6 A Well, in 1998 we replaced the futures options
` 7 trading system and so this new manual was prepared
` 8 because there were changes to the way the trading
` 9 terminals were operating.
`10 Q To whom was this 1998 manual given?
`11 A It was distributed to the participants in the
`12 Tokyo Stock Exchange.
`13 Q When you say participants in the Tokyo Stock
`14 Exchange, what do you mean?
`15 A I refer to securities companies for banks who
`16 are able to carry out futures options trading at the
`17 TSE.
`18 MS. IGA: To carry out or participate?
`19 THE INTERPRETER: No. He didn't use. S-a-n-k-a.
`20 MR. PERKINS: Q About how many participants --
`21 Strike the question.
`22 When was this 1998 manual given to the
`23 participants at the Tokyo Stock Exchange?
`24 A (Through interpreter) In August of 1998.
`
`
`
`
`LEGALINK - CHICAGO
`0013
` 1 Q And about how many participants of the Tokyo
` 2 Stock Exchange was it given to?
` 3 A It was given to all those able to conduct
` 4 futures option trading. That would be around 200
` 5 companies.
` 6 THE INTERPRETER: He's saying -- is it okay if I
` 7 confirm with the witness if he's saying something?
` 8 MR. PERKINS: Yes, please do.
` 9 THE WITNESS: (Through interpreter) Yes, we use
`10 the word participants. Let me rephrase the answer.
`11 It was given to all the participants able
`12 to conduct futures option trading. That would be
`13 about 200 companies.
`14 I didn't hear.
`15 MR. PERKINS: Q And how was this 1998 manual --
`16 Strike the question.
`17 Was it intended that the 1998 manual that
`18 participants rely upon the manual if necessary?
`19 MR. SAMPSON: Objection to the form.
`20 THE WITNESS: (Through interpreter) I don't
`21 understand what you're saying. Maybe I can rephrase
`22 it in Japanese or you can rephrase your question.
`23 MR. PERKINS: Q Why was the 1998 manual given to
`24 the participants of the Tokyo Stock Exchange?
`
`
`
`
`LEGALINK - CHICAGO
`0014
` 1 A (Through interpreter) Well, under the TSE
` 2 trading -- with the new TSE trading system and new
` 3 terminals and therefore the operation of those
` 4 changed, that is the way of operating those changed,
` 5 and this manual was given to explain those changes.
` 6 MS. IGA: May I have a suggestion to the
` 7 translation? At that time Tokyo Stock Exchange
` 8 replaced the future and option trading -- trading
` 9 system and terminal used has been also changed
`10 therefore the operational -- operation itself has
`11 been changed and this manual was to explain the
`12 operation or operational method.
`13 THE INTERPRETER: I don't see any great
`14 difference.
`15 MR. PERKINS: Q How was the 1998 manual
`16 distributed to the participants of the Tokyo Stock
`17 Exchange?
`18 A (Through interpreter) Two copies were
`19 distributed to each company.
`20 Q And how was it distributed?
`21 A We had a person from the participants come to
`22 the TSE operating system section to get the manual.
`23 Q And can any participants of the TSE obtain
`24 the manual if they wanted it?
`
`
`
`
`LEGALINK - CHICAGO
`0015
` 1 MR. SAMPSON: Objection to the form.
` 2 MS. IGA: Did you say any party --
` 3 THE INTERPRETER: What do you mean by any -- you
` 4 have to let me -- please. And then you can. Thank
` 5 you. What do you mean by any participant?
` 6 MR. PERKINS: Q Well, could the participants --
` 7 Strike the question.
` 8 Was there any restriction on what the
` 9 participants could do with the 1998 manual when they
`10 received it?
`11 MR. SAMPSON: Objection, form.
`12 THE WITNESS: (Through interpreter) No.
`13 MR. PERKINS: Q Now, is what is described in the
`14 1998 manual that we've marked as Exhibit 179 an
`15 electronic trading system?
`16 A (Through interpreter) Yes.
`17 Q Does this electronic trading system display
`18 market information for a commodity?
`19 A Yes.
`20 Q Does it display market information for a
`21 commodity on a graphical user interface?
`22 A Yes.
`23 Q And is it an electronic trading system that a
`24 trader can use to place a trade order for a commodity
`
`
`
`
`LEGALINK - CHICAGO
`0016
` 1 on an electronic exchange?
` 2 MR. SAMPSON: Objection, form.
` 3 THE WITNESS: (Through interpreter) Yes.
` 4 MR. PERKINS: Q Let's talk about how the prices
` 5 are displayed on this 1998 manual. Can you turn to
` 6 the page that is marked TSE 749 and to page 7-13 of
` 7 the manual?
` 8 There is a reference in the top line to a
` 9 board in quotation screen. What is the difference
`10 between a board screen and a quotation screen?
`11 A (Through interpreter) A board screen displays
`12 multiple process for issues and the order volume. A
`13 quote screen displays sell and buy bids -- bid
`14 quotes -- bids at that time -- at a particular time.
`15 THE INTERPRETER: Thank you very much.
`16 MR. PERKINS: Q Under 7-2-1.1 is that called a
`17 two split screen?
`18 A (Through interpreter) Yes.
`19 Q And the two split screen can display market
`20 data for two different commodities, is that correct?
`21 A Yes.
`22 Q And the four split screen can display market
`23 data for four different commodities, is that correct?
`24 A Yes.
`
`
`
`
`LEGALINK - CHICAGO
`0017
` 1 Q And the six split screen can display market
` 2 data for six different commodities, is that correct?
` 3 A Yes.
` 4 Q Let's turn to page TSE 753 of the 1998 manual
` 5 which is page 7-17 of the manual. Is this a screen
` 6 display of the two split screen?
` 7 MR. SAMPSON: Objection to form.
` 8 THE WITNESS: (Through interpreter) Yes.
` 9 MR. PERKINS: Q And does the two split screen
`10 display 20 prices in the price column?
`11 MR. SAMPSON: Objection, leading.
`12 MR. PERKINS: Let me rephrase the question.
`13 Q In the two split screen, how many prices are
`14 displayed in the price column?
`15 A (Through interpreter) In the two split screen
`16 it would be 20 prices.
`17 Q How is it determined which 20 prices will be
`18 displayed in the two split screen?
`19 MR. SAMPSON: Objection to form.
`20 THE WITNESS: (Through interpreter) It displays
`21 the 20 prices based on the immediately preceding
`22 price.
`23 MS. IGA: (Japanese translation.)
`24 THE INTERPRETER: Sent it on, focused on the
`
`
`
`
`LEGALINK - CHICAGO
`0018
` 1 immediately preceding price.
` 2 MR. PERKINS: Q When you say immediately
` 3 preceding price, are you referring to the last traded
` 4 price?
` 5 A (Through interpreter) Yes.
` 6 Q If we can turn to page TSE 761 of the manual,
` 7 which is page 7-25? I want to look at the first
` 8 diagram that is on that page and the third row of
` 9 that diagram.
`10 THE INTERPRETER: Are you referring to a diagram
`11 or chart?
`12 MR. PERKINS: Q The top diagram, the third row.
`13 Can you explain for us what's being described there?
`14 A (Through interpreter) Are you referring to
`15 here?
`16 Q Yes.
`17 MR. STERN: Can you be a little more precise when
`18 you say here?
`19 MR. PERKINS: Certainly. I'm referring to the
`20 third row in the diagram.
`21 THE WITNESS: (Indicating.)
`22 MR. STERN: Which does not include the heading.
`23 MR. PERKINS: Yes.
`24 MR. STERN: Third from the top.
`
`
`
`
`LEGALINK - CHICAGO
`0019
` 1 MR. PERKINS: Yes, thank you.
` 2 THE WITNESS: (Through interpreter) This is a
` 3 chart showing -- sorry. Under 7-3-2 this shows the
` 4 information that the terminal displays at the TSE
` 5 concerning board.
` 6 MS. IGA: Are you done?
` 7 THE INTERPRETER: No, I'm trying to get the term.
` 8 Board resented prices.
` 9 MS. IGA: May I give a translation? Here, at
`10 7-3-2 it shows what kind of values are displayed at
`11 the center of the board information of the terminal
`12 display of TSE.
`13 THE INTERPRETER: I think we have to really then
`14 go back to this from -- this page here to debate that
`15 issue. You're -- you're taking the term
`16 c-h-u-s-h-i-n --
`17 MR. PERKINS: If you don't mind, let me
`18 short-circuit this. I will strike the question and
`19 rephrase the question.
`20 Q Is this diagram on this page, the first
`21 diagram, referring to the priority of the price that
`22 would be centered on the screen?
`23 MR. SAMPSON: Objection, leading.
`24 THE WITNESS: (Through interpreter) Yes.
`
`
`
`
`LEGALINK - CHICAGO
`0020
` 1 MR. PERKINS: Q And in the continuing session,
` 2 which price would have priority in terms of being
` 3 centered on the screen?
` 4 A During trading the top priority would be
` 5 given to the -- I will have to ask you.
` 6 MS. IGA: I think it's warning.
` 7 THE INTERPRETER: That's what I thought too. For
` 8 warning prices and for special quotations. Second
` 9 priority would be given to the latest trade sell
`10 orders and buy orders. And the third priority would
`11 be given to the latest strike, strikes.
`12 MS. TOMITA: Execution price.
`13 THE INTERPRETER: I would say strike.
`14 MR. PERKINS: What is the official answer?
`15 THE INTERPRETER: I'll go with strike price.
`16 MR. PERKINS: Q What is a special quotation
`17 price?
`18 A (Through interpreter) The special quote is
`19 placed -- the special quotes refers to a situation
`20 when there is a bias of either sell orders or buy
`21 orders on one side and so a certain distance in price
`22 occurs with -- between that and the next execution in
`23 price in order to -- in order to deal with this bias
`24 in the price, the special quote is displayed.
`
`
`
`
`LEGALINK - CHICAGO
`0021
` 1 MS. IGA: May I give alternative translation?
` 2 The special quote happens at a time when the bids and
` 3 asks concentrate on one side and therefore there is a
` 4 big gap between these with last executed price,
` 5 therefore, in order to notify such a buyer a
` 6 concentration is happening this special quote is
` 7 issued.
` 8 THE INTERPRETER: Accepted.
` 9 MR. PERKINS: Q Would it be fair to say that
`10 under normal trading conditions the price that will
`11 have priority in terms of being centered on the
`12 screen is the last executed price?
`13 MR. SAMPSON: Objection, leading. Objection,
`14 form.
`15 THE INTERPRETER: Objection?
`16 MR. SAMPSON: Leading and form.
`17 THE WITNESS: (Through interpreter) Yes.
`18 MR. PERKINS: Q And under normal conditions
`19 would it be fair to say that the last executed price
`20 will happen at either the best bid or the best offer?
`21 MR. SAMPSON: Objection, form. Objection,
`22 leading.
`23 THE WITNESS: (Through interpreter) That would be
`24 commonly the case.
`
`
`
`
`LEGALINK - CHICAGO
`0022
` 1 MR. PERKINS: Q Can you explain to us what is
` 2 the continuing session status?
` 3 MR. STERN: Counsel, are you quoting a term in
` 4 the document?
` 5 MR. PERKINS: Yes.
` 6 MR. STERN: Can you identify that for the
` 7 witness?
` 8 MR. PERKINS: Certainly. Going back to the third
` 9 row in the first diagram on the page marked TSE 761
`10 there is a reference there to a continuing session.
`11 I just want a general explanation for that.
`12 THE WITNESS: (Through interpreter) From the
`13 initial time of the -- the initial price up until
`14 just prior to the ending of the session.
`15 MR. PERKINS: Q Is the continuing session the
`16 time that the market is opened for trading?
`17 MR. SAMPSON: Objection, leading.
`18 THE WITNESS: (Through interpreter) Well, if the
`19 striking of the initial price is delayed, it won't be
`20 that same time, but essentially it is the time of
`21 that. Essentially it is the same time.
`22 MR. PERKINS: Q So under normal operating --
`23 Strike the question.
`24 Under normal trading conditions during the
`
`
`
`
`LEGALINK - CHICAGO
`0023
` 1 continuing session in the two split screen, the price
` 2 that will be displayed in the center of the screen
` 3 would be the last executed price, is that correct?
` 4 MR. SAMPSON: Objection, leading.
` 5 THE WITNESS: (Through interpreter) That is
` 6 commonly the case.
` 7 MR. PERKINS: Q If we can turn to page TSE 714
` 8 which is page 6-3 of the 1998 manual? There is a --
` 9 references on that page to the compressed and
`10 noncompressed price display. Can you explain the
`11 difference between those two for us?
`12 MR. SAMPSON: Objection, form.
`13 MR. STERN: And I'm going to object because the
`14 question goes outside of chapter seven, which is the
`15 section stipulated in the commission, but I will give
`16 you some latitude.
`17 MR. PERKINS: I think it's still related because
`18 it explains how prices in chapter seven are displayed
`19 as well.
`20 MR. STERN: He may answer.
`21 THE WITNESS: (Through interpreter) He will, the
`22 difference between -- well. Sorry.
`23 The noncompressed price display shows --
`24 displays price board information even if there are no
`
`
`
`
`LEGALINK - CHICAGO
`0024
` 1 orders. The compressed price display shows prices
` 2 with conditions.
` 3 MR. PERKINS: Q Okay.
` 4 MS. IGA: For conditions.
` 5 THE INTERPRETER: Prices?
` 6 MS. IGA: Prices to meet with four conditions.
` 7 THE INTERPRETER: I'm so busy I'm not reading
` 8 this.
` 9 MR. PERKINS: Q Just so I understand, in the
`10 noncompressed price display for a two split screen
`11 all 20 prices will be displayed even if there is no
`12 order at that price?
`13 MR. SAMPSON: Objection, leading.
`14 THE WITNESS: (Through interpreter) Yes.
`15 MR. PERKINS: Q And in the compressed price
`16 display it will only show prices for which there is
`17 an order, is that correct?
`18 MR. SAMPSON: Objection, leading.
`19 THE WITNESS: (Through interpreter) Essentially
`20 when there are prices as it says here on this page,
`21 when the four conditions are met, those prices will
`22 be displayed.
`23 MR. PERKINS: Q When you say four conditions
`24 are met, what conditions are you referring to?
`
`
`
`
`LEGALINK - CHICAGO
`0025
` 1 A Well, the four conditions listed here; the
` 2 price when an order exists, the last executed price,
` 3 the quotation display price, and the -- the -- there
` 4 has been a -- sorry, there's been a -- for the sake
` 5 of -- there's been a little exchange here explaining
` 6 what this term, t-a-i-t-o, n-a-d-a-n-o means. And
` 7 the witness has said it's a price at which there can
` 8 be an execution.
` 9 THE REPORTER: Spell that again, please. T-a --
`10 THE INTERPRETER: T-a-i-t-o, n-a-d-a-n-o.
`11 Now we have to go back and try and remember
`12 what he said. In the -- I apologize, you're going to
`13 have to ask the question again.
`14 MR. PERKINS: Q The four conditions that you're
`15 referring to, those are set forth in the four bullet
`16 points above the two diagrams on page TSE 714?
`17 MR. SAMPSON: Objection, leading.
`18 THE WITNESS: (Through interpreter) Yes.
`19 MR. PERKINS: Q Let's turn to page TSE 753, page
`20 7-17 of the 1998 manual. Is this a two split screen
`21 with a noncompressed price display?
`22 A (Through interpreter) Yes.
`23 Q On this screen there are what I'll call
`24 reference numerals which are numerals with circles
`
`
`
`
`LEGALINK - CHICAGO
`0026
` 1 around them. And I want to focus on the column with
` 2 the reference numeral 11.
` 3 MR. SAMPSON: Objection, form.
` 4 MR. PERKINS: Q What is shown in that column?
` 5 A (Through interpreter) It shows prices.
` 6 Q There is an over and under in the price
` 7 column. What do those represent?
` 8 MR. STERN: Are you quoting over and under as
` 9 part of the document, or is that a characterization
`10 that you're applying?
`11 MR. PERKINS: No, that is what the document says.
`12 MR. STERN: Not to him.
`13 MR. SAMPSON: No, it is in the Japanese version.
`14 MR. STERN: I'm sorry. I apologize.
`15 THE INTERPRETER: What do you want done?
`16 MR. STERN: Translate literally.
`17 THE INTERPRETER: I'm sorry, what do you want
`18 done?
`19 MR. STERN: Translate the question, please.
`20 THE INTERPRETER: I already have. I need to
`21 confirm the numbers again.
`22 THE WITNESS: (Through interpreter) So in the
`23 example given on this screen, over refers to price
`24 information above 13029 and under refers to price
`
`
`
`
`LEGALINK - CHICAGO
`0027
` 1 information below 13010.
` 2 MR. PERKINS: Q In the column that is labeled 12
` 3 which is immediately to the left of the price column,
` 4 what does that column represent?
` 5 MR. SAMPSON: Objection, form.
` 6 THE WITNESS: (Through interpreter) 12 represents
` 7 the bid volume and to the left of that shows the
` 8 number of orders that have been made.
` 9 MS. IGA: For that price.
`10 THE INTERPRETER: For that price. Thank you.
`11 When you have the right timing I would like to have a
`12 couple minutes.
`13 MR. PERKINS: Q So the column immediately to the
`14 left of the price column under -- that's labeled 12,
`15 that is the bid volume?
`16 MR. SAMPSON: Objection to form. Objection,
`17 leading.
`18 THE WITNESS: (Through interpreter) The column on
`19 the right shows -- maybe you should perhaps ask the
`20 question again.
`21 MR. PERKINS: Q Sure. In the column to the left
`22 of the price column that has the 1810, that is the
`23 top number in the column, what does that column
`24 represent?
`
`
`
`
`LEGALINK - CHICAGO
`0028
` 1 THE WITNESS: (Through interpreter) Column 11
` 2 shows the volume of orders placed for the prices on
` 3 the -- shown on the right.
` 4 MR. STERN: Column on the left.
` 5 MR. PERKINS: Column 12.
` 6 THE INTERPRETER: Did I say 12?
` 7 MR. PERKINS: You said column 11.
` 8 THE INTERPRETER: I apologize. So let me go
` 9 again. Column 12 the numbers in column 12 shows the
`10 volume of orders placed for the prices on the --
`11 MS. TOMITA: Same order.
`12 THE INTERPRETER: What? Well, sell orders, yeah.
`13 MR. PERKINS: So what's the answer?
`14 MS. IGA: I think we are referring to bid volume
`15 so far.
`16 THE INTERPRETER: Let me go again then. The
`17 numbers in column 12 display the bid volume for the
`18 prices shown on the column in the column on the
`19 right. And right before indicates that I need a
`20 break.
`21 (Short break was had.)
`22 MR. PERKINS: Back on the record.
`23 Q Showing you what I have marked as
`24 Defendant's Exhibit 180, which is simply page TSE 753
`
`
`
`
`LEGALINK - CHICAGO
`0029
` 1 from the 1998 manual, I'm going to circle in red a
` 2 column. Is what's shown in that column the bid
` 3 volume or the ask volume?
` 4 A (Through interpreter) It's the -- the --
` 5 MS. TOMITA: Ask.
` 6 THE INTERPRETER: -- ask volume.
` 7 MR. PERKINS: Q I'm going to label that ask.
` 8 And I'm going to circle in blue another column. Is
` 9 that the bid volume column?
`10 A (Through interpreter) It is the bid column.
`11 Q I'm going
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