Naccho Live-Blogging: Greg Casey, Part II

March 27 2007, 2:48 PM

3:35 pm. Greg Casey resumes direct examination by James Hearty. [Note: This is not a transcript. It is just my notes of the testimony as fast as I can type them. Spelling errors will be corrected tonight. I will update every fifteen minutes or so, so either check back or refresh the page.] Hearty: Before the recess we were gong through the April Business Unit Review meeting and the presentation you used during that meeting. Turn to page 8. The page is entitled "Second quarter Sales Funnel for IRU's." This is the entire universe of IRU deals that we were working on that we thought had some value or merit to them. What would be a reasonable expectation? What percentage of the 900 million did you think you could close? A funnel is broad at the top and narrow at the bottom. If we could close 10 to 20 percent of that funnel, we would be happy. These are the deals for which there were visibility. Having these deals in the funnel made him think they would be okay for the second quarter for 2001. The problem was they had nothing in the funnel for the second half of the year.

Look at page 15. Bottom right quadrant is 2001 estimate. It's a current estimate prepared by finance people as to what would occur for the rest of the year. What was his message to Nacchio? The IRU's were going away. They didn't have anything to take their place. He thinks Joe just listened to what he had to say. Did N. make any statements to him that there was some ability to sell IRU's to the federal govt? No. Did he ever make any such statement to him? No. New topic: 3:44 pm Had you ever given Nacchio a warning like this before? No. Are you familiar with life after IRU's? Yes. There was a recognition that IRU's would be going away so we needed to find replacement revenue. The product group was working on new products to replace the IRU's. Time frame: around April. These meetings were referred to at Qwest as life after IRU meetings. He doesn't believe they resulted in finding any. ******** Next: Accounting changes. In May, he became aware accounting changes had been made that would affect the wholesale unit's ability to meet even the second quarter's targets. The change had to do with swaps. ********** Did you enter into an agreement with the Government about providing info to the Govt? Yes, I agreed to cooperate and tell the truth. In return, he got immunity from prosecution. He was sued by SEC. He has resolved those claims. He paid money to the SEC without admitting or denying guilt. After consulting with counsel, he felt it was best to put Qwest issues behind him and move on with his life. End of Direct. On to cross by Defense and new thread.

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