Day 9: The Government Continues its direct Examination of Former Qwest COO Mr. Mohebbi

This morning began with Mr. Stricklin continuing his examination of Mr. Mohebbi concerning the merger between Qwest and USWEST, and the internal conflicts over the ability to meet targeted numbers between the business units and Qwest management. The testimony was riddled with objections by Mr. Stern, often overruled, which ground Mr. Mohebbi’s testimony to a slow pace.

The initial line of questioning focused on what was being presented to the public concerning the merger. Mohebbi stated that “growth” was the major selling point to investors. Mr. Mohebbi was very articulate in explaining the challenges faced by two large companies coming together to make the numbers given to the street.

The next line of questioning largely reiterated testimony from prior witnesses concerning the gap in the budget numbers between the Qwest’s business units and the targets set by Mr. Nacchio.  Mr. Mohebbi again discussed the top down nature of the targets and the bottom up process employed by the business units. 

In meetings in November 2000, Mr. Mohebbi testified and the documents appeared to show that some of the divisions, particularly National Mass Market, was having trouble coming up with a budget that would meet the target.  He testified that this was a concern in part because that division lacked "the tools"  to easily make up the difference.  At one meeting where this "gap"  was discussed, a Qwest official, according to Mr. Mohebbi, was so upset that he threw his papers towards the director of the National Mass Market division, causing Mr. Nacchio to ask him to apologize.  

Much of the rest of the morning was devoted to a discussion of a series of memorandums written by Mr. Mohebbi and intended for Mr. Nacchio (it is not clear in every case that Mr. Nacchio actually received the memorandum).  One particular memo stated the numbers given to the street were a “huge stretch,” and that Qwest needed its “recurring business to literally take off by April-May time frame or the amount of one-time businesses required to fill the gap will just be to large to deal with." The memo to Mr. Nacchio went on to state that "[o]ur track record in this area is not that good as you know.”  This line of questions continued to reiterate that Mr. Nacchio new his numbers to the street were in serious trouble of not being met.

There was continued tension between Judge Nottingham and Mr. Stern.  Mr. Stern was repeatedly warned that several of his objections were not legal objections, but were rather speeches or more appropriate topics for cross-examination.  Nonetheless, he successfully used the tactic (and his opportunity to voir dire) to sometimes break the flow of Stricklin's questions or point out a weakness in the testimony.