This confirms discussion with Don in your office yesterday, ref a, per your letter, ref b, answering my request for a 30 day extension on responding to your summons, ref c. It was generous of Wolkin and Timpane to grant an extension of 15 days, in light of Don's report that a 30 day extension requires extra effort to file a motion with the court.

I apologize and deeply regret inconvenience caused by Communication Metrics, as related in your letter yesterday, ref b. The goal is to accomplish Intel's objective to use technology for improving management, as set out in the April 1991 issue of Byte. The Intel manager, who authored the article, wrote me a letter on April 22, 1999 saying Communication Metrics achieves Intel's goal, and said the key question is "...where to take it from here?" Despite this progress, people get upset using new methods in the beginning, which makes marketing a big challenge within the meaning of a "disruptive technology," described by Clay Christenson in his book The Innovator's Dilemma, reviewed on May 27, 1999. This history shows there was no disrespect intended in communicating with you via the web, nor intent to force Wolkin and Timpane to use a business method that seems foreign and requires extra effort to click on links for obtaining relevant information, history and authority. Considerable effort has been made to make this method easy to use; but, clearly, there is more work to do.

This additional work is underway through two parallel paths.

On June 16, 1999 I submitted proposal #9961176 to the National Science Foundation to support research on solving the problems you encountered. On June 29, 1999, Ms. Sara B. Nerlove, a research manager with the NSF, called and discussed for two (2) hours the merits of Communication Metrics, including the challenge of marketing. This project, would, if approved, be performed beginning OA Jan 1, 2000, with a follow on larger Phase II project to develop commercial support for Communication Metrics. Last week, on May 27, 1999 I submitted a supplemental proposal to focus research on Common Administration of projects, most typically in construction, as a means to overcome emotional resistance to adding a system of business metrics to daily communication. This method greatly increases the chances of successful projects for owners, contractors and design professionals, and thus reduces the risk to sureties. However, strong cultural resistance warrants NSF support, as set out in the proposal.

A second path is through Intel, which is a leading funder of new technologies. Dave Vannier, who, on June 3, 1997, tried to get approval for using Communication Metrics, at Intel, and encountered the reaction in your letter yesterday, is due back from a 4 month sabbatical and is starting a new marketing project at Intel. Dave wrote the Byte article in April 1991 that formulates the goal for using technology to improve management, which he noted in April of this year is accomplished by Communication Metrics. Previously, on May 5, 1996 Dave had rejected Communication Metrics. So, his reversal of position is noteworthy in showing the effort required even for technologists to grasp the power of this capability. Another contact at Intel, Morris Jones, who has helped develop the SDS technology, is meeting with Dave to map strategy on this in the next week or so.

Other efforts continue by using the web to give people experience using technology to apply the legal process that aligns information through traceability to original sources. A legal opinion cites the case record which consists of testimony and documents, plus precedents, statues, codes and regulations. It takes a lot of time to create and check citations. Electronic links reduce this time by an order of magnitude, so that legal practice to maintain alignment can be applied more broadly, to avoid mistakes rather than adjudicate them after-the-fact.

On September 21, 1993, Anne Bevington, in Gerry Knecht's office, advised that this capability would be helpful to legal practice. More recently, on October 28, 1997 the San Francisco District of the U.S. Army Corps of Engineers published a report that Communication Metrics provides an "intelligence" capability for daily management. On October 7, 1997 the District reported this method saved millions of dollars. The District Engineer would not approve additional use of Communication Metrics because, like you, he did not want to do business using this method. He said he believed it does not save money despite contrary opinions from his staff. Eighteen months or so later, District Counsel issued a letter stating with "certainty" this method saved the government $200K. That evidence was rejected by the DE without any opposing evidence.

As a lawyer, you can appreciate the frustration when decisions ignore evidence, as Gerry noted in the Welch case, where Judge Perlus at trial in 1979 stared at an estimate file showing a tide level from the bid plans drawn onto Welch bid calculation sheets, and commented that this did not show reliance on erroneous tide levels to bid the job, which he had earlier ruled was a material misrepresentation. As well, Gerry was frustrated when the 3rd District Court of Appeal in Welch two, overturned the law of the case, and falsely ruled that its first opinion, holding that appellant "doubtless" would have have been informed of difficult tide conditions had withheld information been disclosed, stated instead that Welch "may" have been,... etc. Turning "doubtless" into "may" could be a risk that bonding companies and contractors must ultimately share as a frustration endemic to life. This year a key manager in the District retired, in part, because of frustration over refusal to use Communication Metrics, despite evidence of substantial cost savings.

What then to do?

With respect to the instant matter, I propose that UPR extend its forbearance for another 24 months, to see if the NSF, Intel and other initiatives can achieve the breakthrough needed to reach market success, which will make it possible to reward UPR's long standing patience with full payment.

Alternatively, please submit the ruling you want the judge to issue and I will try to comply immediately in order to avoid further litigation with UPR which at all times has acted with integrity and professionalism, beginning with Hy Stebbins comment in July of 1975 when we discovered the error in the bid plans, that "... someday a judge is going to look at this case, Rod, and award you a lot of money for what the state has done." While Hy's forecast was incorrect, it aligned with Judge Virga's comment to State counsel in 1984, that he wished he were Welch's attorney because the State was going to have to pay a lot of money to Welch. It aligned with former Governor Pat Brown's assessment, with Judge Sappenor's comment to me personally, and on and on, with everyone who has looked at this matter, but those who ultimately ruled. So, I am sure Hy was correct, and have always had a high regard for UPR, and wish only to do them well, within my limits to perform.

I apologize again for communicating through web mail, and did not intend disrespect to Wolkin and Timpane in using this method. Please let me know UPR's decision by September 8, so I can respond to the summons as extended.

Sincerely,

THE WELCH COMPANY

Rod Welch
rowelch@ibm.net

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