- 7 -
establishment of such an undertaking. EAPR was incorporated
under Delaware law on May 15, 1992, as a subsidiary of EA, to
manufacture video games and other software entertainment
products. EA bought video games from EAPR in each of the years
in issue.
B. Agreements; Procedures
EA issued purchase orders to EAPR for video games. EA
generated these purchase orders in San Mateo, California. When
EAPR, through its manager and employees covered by the
Manufacturing Services Agreement (hereinafter sometimes referred
to as the Agreement), shipped completed video games to EA, EAPR’s
manager or an employee covered by the Agreement (hereinafter
sometimes referred to as a lease employee) input into EAPR’s
computerized Material Requirement Planning System (hereinafter
sometimes referred to as the MRP System) shipping data relating
to the shipment. (The Agreement, including the arrangements as
to lease employees, is described in greater detail infra I.E.)
The MRP System was used to manage EAPR’s inventories by tracing
(a) raw materials and components as inputs and inventory, (b)
production schedules, (c) movements of material and component
inventories through stages of the manufacturing process, and (d)
finished video games as outputs relating to the manufacture of
video games in Puerto Rico. An invoice from EAPR then was
generated in San Mateo with respect to the completed video games.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011