By: Daniel W. McDonald (dmcdonald@merchantgould.com)
`Merchant & Gould P.C.
`3200 IDS Center
`80 South 8th Street
`Minneapolis, MN 55402
`Tel: (612) 332-5300
`Fax: (612) 332-9081
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`CARDIOCOM, LLC
`Petitioner
`
`v.
`
`ROBERT BOSCH HEALTHCARE SYSTEMS, INC.
`Patent Owner
`____________
`
`Case IPR2013-00468
`Patent 7,516,192
`____________
`
`PETITIONER’S MOTION TO EXCLUDE EVIDENCE SUBMITTED BY
`PATENT OWNER UNDER 37 C.F.R. § 42.64
`
`
`
`
`
`
`Merchant & Gould P.C.
`3200 IDS Center
`80 South 8th Street
`Minneapolis, MN 55402
`Tel: (612) 332-5300
`Fax: (612) 332-9081
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`CARDIOCOM, LLC
`Petitioner
`
`v.
`
`ROBERT BOSCH HEALTHCARE SYSTEMS, INC.
`Patent Owner
`____________
`
`Case IPR2013-00468
`Patent 7,516,192
`____________
`
`PETITIONER’S MOTION TO EXCLUDE EVIDENCE SUBMITTED BY
`PATENT OWNER UNDER 37 C.F.R. § 42.64
`
`
`
`
`
`
`
`Case IPR2013-00468
`Patent No. 7,516,192
`
`I.
`Patent Owner and its expert, Dr. Yadin David, fail to establish any nexus
`
`Introduction.
`
`between Patent Owner’s alleged evidence of secondary considerations of non-
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`obviousness and the actual claimed invention. In fact, Dr. David admitted that he
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`performed no analysis linking the alleged secondary considerations to the claimed
`
`invention. Because Patent Owner fails to establish the required nexus, Petitioner
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`Cardiocom, LLC (“Cardiocom”) moves, based on Federal Rule of Evidence 402,
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`to exclude the Patent Owner’s purported evidence of secondary considerations, in
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`particular Exhibits 2010-2057 and paragraphs 70-110 of Exhibit 2007, submitted
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`with Patent Owner’s Response.
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`Additionally, pursuant to Federal Rule of Evidence 802, the Board should
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`exclude hearsay statements cited by Dr. David regarding statements by Patent
`
`Owner employees and the inventor regarding purported commercial success, and
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`other non-obviousness factors. Dr. David introduced hearsay evidence in
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`paragraphs 79, 82, 88, 91, 95-96, 103, 104, 106, 107, and 109 of his declaration,
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`which is Exhibit 2007. In each of these paragraphs, Dr. David refers to or relates
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`hearsay evidence from conversations with unsworn witnesses and documents.
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`While an expert may rely on such documents and conversations in coming to his
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`conclusions, as shown above those opinions should be excluded under Rule 402.
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`Moreover, whether or not the expert’s opinions that rely on these statements are
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`1
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`
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`allowed, the cited statements remain hearsay and should not admitted for the
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`purpose of proving the truth of the matters asserted. See Fed. R. Evid. 703 and 802.
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`See also Fed. R. Evid. 105 (evidence may be admitted for a limited purpose).
`
`Petitioner originally served objections to the foregoing on April 8, 2014. For
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`at least the reasons detailed below, the Board should exclude each of Exhibits
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`2010-2057 and paragraphs 70-110 of Exhibit 2007 or alternatively limit the
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`admission of the hearsay statements in paragraphs 79, 82, 88, 91, 95-96, 103, 104,
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`106, 107, and 109 of the David Declaration, Exhibit 2007, to exclude the use of
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`such statements to prove the truth of the matters asserted.
`
`II. Argument.
`
`A. Patent Owner and its Expert Provide No Nexus Between the
`Proffered Evidence of Secondary Indicia of Non-Obviousness
`and the Claimed Invention.
`
`Patent Owner’s proposed evidence of non-obviousness should be excluded
`
`because Patent Owner failed to establish a nexus between the alleged evidence and
`
`the claimed features. “The patentee bears the burden of showing that a nexus exists
`
`between the claimed features of the invention and the objective evidence offered to
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`show non-obviousness.” Ormco Corp. v. Align Tech., Inc., 463 F.3d 1299, 1312-13
`
`(Fed. Cir. 2006) (holding that patent owner’s evidence of commercial success and
`
`failure of others lacked sufficient nexus with the claimed features); In re Paulsen,
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`30 F.3d 1475, 1482 (Fed. Cir. 1994) (affirming the Board’s rejection of claims and
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`
`
`2
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`
`
`holding that the patent requester failed to show a nexus between the product’s
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`commercial success, copying, and professional recognition and the claims of the
`
`invention). Evidence of commercial success of a product is not enough; the
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`patentee must show that the claimed commercial success is tied to claimed
`
`features, and not to features found in the prior art. Ormco, 463 F.3d at 1312.
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`Failure to show the nexus should result in exclusion of the evidence. See Merck &
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`Co. v. Teva Pharms. USA, Inc., 395 F.3d 1364, 1376-77 (Fed. Cir. 2005) (holding
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`that the district court erred in considering evidence of non-obviousness when the
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`patent owner’s product was commercially successful, but the patent owner had not
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`shown that success to be the direct result of claimed features).
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`Patent Owner failed here to tie its proffered evidence to the claimed
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`invention. Patent Owner’s expert, Dr. David, identified Exhibits 2010-2057 as
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`evidence of non-obviousness. Dr. David commented on those exhibits in
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`paragraphs 70-110 of his declaration. Neither Patent Owner nor Dr. David
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`provides any support that the show that commercial success or the other secondary
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`indicia relied upon are a result of the claimed features of the patent. All the
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`evidence relates to the Health Buddy product, yet Dr. David and Bosch made no
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`showing that the Health Buddy practiced any claims of the ’192 patent, let alone
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`that any of the claimed features resulted in commercial success or other indicia of
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`non-obviousness. Reply Declaration of Dr. Stone, Ex. 1022 (“Stone Reply Decl.”)
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`
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`3
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`
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`¶64. Dr. David admits that he made no comparison of the claims of the ’192 patent
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`to the allegedly successful product:
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`Q. In your declaration for the '192 patent that you have in front of you,
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`did you provide any element-by-element analysis indicating whether or
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`not any versions of the Health Buddy product practiced any of the claims
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`of the '192 patent?
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`***
`
`THE WITNESS: I see. No, I did not.
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`David Dep. 499:1-9. Similarly, the discussions with the employees related to
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`purported general success and were not specific to the claims of the patent.
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`Deposition of Dr. David (“David Dep.”) 245:9-246:3 (Ex. 1041).
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`Dr. David apparently assumed that all the proffered secondary evidence he
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`gathered from the inventor and employees was due to the claimed invention, as he
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`admitted that he did not even explore the possibility that any success was due to
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`other factors. David Dep. 171:18- 172:7. His explanation was illuminating:
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`Q. Why didn't you ask them whether or not the success of the product might
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`have been attributable to something other than what's claimed in the four
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`patents?
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`MR. VENKATESAN: Objection; form.
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`THE WITNESS: Simply because it was not one of my tasks to do.
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`
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`4
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`
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`BY MR. MCDONALD:
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`Q. Who assigned you your tasks?
`
`A. Orrick assigned me the task.
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`David Dep. 172:9-18. Clearly, Dr. David’s methodology was fundamentally
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`flawed.
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`Adding insult to injury, Patent Owner’s contentions of secondary indicia are
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`based on the purported benefits of the “four-button design,” which Dr. David said
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`“differentiated” the Health Buddy product from “other offerings.” Ex. 2007 ¶78.
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`Dr. David admitted that the four-button design was “one of the important features”
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`that got the Health Buddy “attention from the marketplace.” David Dep. 139:6-12.
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`He also admitted that the four-button design was a “key feature of the product with
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`respect to whether it resolved a long-felt need in the industry.” David Dep.
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`144:10-24. He also relies on that feature throughout the secondary consideration
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`sections of his declaration. Ex. 2007 ¶¶77, 78, 94.
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`As Dr. David admitted, however, this purported “key feature” is not claimed
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`in the ’192 patent:
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`Q. You agree, don't you, that the claims of the '192 patent do not claim a
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`four-button patient interface?
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`***
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`A. It's not specifically identified in the claim language.
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`
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`5
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`
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`David Dep. 499:23-500:4. Indeed, that interface was the subject of a separate
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`design patent and apparently was designed primarily by a third-party industrial
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`design company, IDEO. David Dep. 167:13-15; Stone Reply Decl. ¶74, Petitioner
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`Exs. 1026, 1029, 1031. Thus, the evidence Patent Owner submitted is fatally
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`flawed, as Dr. David admitted that the success and other considerations he cites are
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`due to an unclaimed and irrelevant “key” feature. This affirmatively shows that
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`the purported secondary evidence has no nexus to the claimed invention.
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`Undaunted by the lack of nexus, Dr. David erroneously asserted that the
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`purported evidence would still indicate non-obviousness even if the sales of Patent
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`Owner’s device were attributable to non-claimed features. David Dep. 161:6-9.
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`This statement is legally flawed, confirming that his opinions were improperly
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`derived and should be excluded. See Ormco, 463 F.3d at 1312; Merck, 395 F.3d at
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`1376-77.
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`The secondary evidence has other gaps so fundamental as to warrant
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`exclusion. Dr. David admitted there was nothing in his declaration indicating the
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`Patent Owner or its predecessor “ever made money” on the products, replying:
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`“That’s correct, I didn’t do economic analysis.” David Dep. 120:1-7. The
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`evidence is vague as to unit sales by year as well. Moreover, for commercial
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`success evidence to be relevant, units sold and profits are insufficient without
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`showing market share and profitability compared to the industry. Cable Elec.
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`
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`6
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`
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`Prods. v. Genmark, Inc., 770 F.2d 1015, 1026-27 (Fed. Cir. 1985). Here, the
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`Patent Owner and Dr. David made no effort at all to show relative success of the
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`purportedly claimed invention. Dr. David identified several competitor products
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`that did remote monitoring and even customized monitoring, that he “believed”
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`were successful and “guessed” met market needs, yet his analysis ignores them.
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`David Dep. 218:7-25; 220:4-21; 221:24- 222:8.
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`Dr. David’s analysis is fundamentally flawed. For these reasons, the Board
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`should exclude paragraphs 70-110of Exhibit 2007, which are the paragraphs of Dr.
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`David’s declaration dealing with indicia of non-obviousness. Moreover, the
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`exhibits he relies on for secondary considerations, Exhibits 2010-2057, should
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`similarly be excluded. These exhibits relate to the Health Buddy product cited by
`
`Dr. David—a product which was not shown to even practice any of the claims of
`
`the patent. Because Dr. David’s flawed testimony was the only purported grounds
`
`for finding a nexus between this evidence and the claimed invention, that evidence
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`lacks the required nexus and should be excluded.
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`B. The Board Should Exclude Patent Owner’s Hearsay Evidence.
`Embedded in Dr. David’s declaration are several paragraphs which cite
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`third-party hearsay evidence. Most of these paragraphs are in the secondary
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`considerations section addressed above, specifically paragraphs 79, 82, 88, 91, 95-
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`96, 103, 104, 106, 107, and 109. This section provides additional grounds for
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`7
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`
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`exclusion as to those paragraphs. All such statements are hearsay under Federal
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`Rule of Evidence 801, fall under no exceptions, and should be excluded under Rule
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`802.1 Such evidence is hearsay and may not be used to prove the truth of the
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`matter asserted. Fed. R. Evid. 802.
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`The general rule that experts may rely on inadmissible evidence to form
`
`their opinions does not apply here for two reasons. First, as shown above, Dr.
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`David’s secondary considerations analysis is fundamentally flawed and should be
`
`excluded under Rules 702 and 703. Those inadmissible opinions do not insulate
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`the hearsay statements from exclusion. Second, whether or not the expert opinions
`
`are allowed, the hearsay statements should not be admitted as direct evidence of
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`the truth of the matter asserted, apart from supporting any expert conclusions.
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`The latter issue is of importance here because Patent Owner uses the hearsay
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`as direct evidence, apart from the expert opinion. In its Response, Patent Owner
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`makes direct factual assertions based on the hearsay. For example, Patent Owner
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`
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` 1
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` For example, Dr. David states, “In the private sector, the Bosch personnel I
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`interviewed recalled that the Health Buddy was adopted by a number of other
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`hospitals and pharmacies.” Ex. 2007 ¶ 79.
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`
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`8
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`
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`asserts, “Numerous private sector hospitals and pharmacies tested the device
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`through pilot programs shortly after its release,” and cites to Dr. David’s paragraph
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`79 as the sole support. Response at 23. That paragraph, however, only regurgitates
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`what some Bosch witness told Dr. David, and reflects no independent analysis of
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`the issue by Dr. David. Such out-of-court, untested2 statements by witnesses are
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`textbook hearsay. Patent Owner may not evade exclusion simply by having its
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`expert repeat the hearsay in a declaration. See Vondrak v. City of Las Cruces, No.
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`No. CIV-05-0172, 2007 U.S. Dist. LEXIS 55677, at *3 n.4 (D.N.M. May 14,
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`2007)( “Rule 703 of the Federal Rules of Evidence allows an expert to rely on
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`inadmissible facts in reaching an opinion or inference, but does not allow the
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`proponent of the expert testimony to use the expert as a conduit for a party to get in
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`otherwise inadmissible evidence[;] the Court will not consider those portions of
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`Gaut's report discussing statements . . . that are hearsay”). See also Daubert v.
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`Merrell Dow Pharms., Inc., 509 U.S. 579, 590 and n. 9 (1993) (explaining that
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` 2
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` Petitioner sought to depose the third party witnesses referenced in Dr.
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`David’s declaration, but Bosch refused and the board denied Petitioner’s motion to
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`compel. Paper #45.
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`9
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`expert testimony should be scientific in nature, based on solid evidence, not simply
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`restating factual testimony).
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`Patent Owner repeats this process over and over, citing Dr. David’s
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`parroting of what he was told by others as direct proof of the matters asserted in
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`the hearsay. See Response at 23-26 (citing paragraphs 79, 82, 88, 91, 95-96, 103,
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`104, 106, 107, and 109 of David’s declaration). Dr. David’s “testimony” regarding
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`Patent Owner’s sales and market presence are not the result of Dr. David’s
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`personal experience, because Dr. David admits that he never even saw the Health
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`Buddy system before being hired for this matter in 2014. David Dep. 162:18-21.
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`Therefore, Petitioner’s motion should be granted to preclude Patent Owner from
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`relying on hearsay as direct evidence to support its claims of non-obviousness. If
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`Dr. David is allowed to provide opinions in reliance on that hearsay, the use of
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`such hearsay should be limited to that purpose (supporting the opinions) under Fed.
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`R. Evid. 105, with use to prove the truth of the matter asserted precluded.
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`III.
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` Conclusion
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`For the reasons discussed above, the Board should exclude Exhibits 2010-
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`2057 and paragraphs 79, 82, 88, 91, 95-96, 103, 104, 106, 107, and 109 of Exhibit
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`10
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`2007.
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`Respectfully submitted,
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`Date: July 31, 2014
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`/Daniel W. McDonald/
`Daniel W. McDonald, Reg. No. 32,044
`Attorneys for Petitioner Cardiocom
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`11
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`CERTIFICATE OF SERVICE
`
`
`The undersigned hereby certifies that a copy of the foregoing
`PETITIONER’S MOTION TO EXCLUDE EVIDENCE SUBMITTED BY
`PATENT OWNER UNDER 37 C.F.R. § 42.64 has been served on July 31, 2014,
`by email on counsel of record for the patent owner at the following name and
`address:
`
`Don Daybell (ddaybell@orrick.com)
`Davin M. Stockwell (dstockwell@orrick.com)
`Bas de Blank (basdeblank@orrick.com)
`Lillian Mao (lmao@orrick.com)
`BoschvCardiocom-IPRServiceList@orrick.com
`D2DPTABDocket@orrick.com
`ORRICK, HERRINGTON, &
`SUTCLIFFE LLP
`2050 Main St., Suite 1100
`Irvine, CA 92614
`Tel: 949-567-6700
`Fax: 949-567-6710
`
`Respectfully submitted,
`MERCHANT & GOULD P.C.
`P.O. Box 2903
`Minneapolis, Minnesota 55402-0903
`(612) 332-5300
`
`
` / Daniel W. McDonald /
`Daniel W. McDonald (Lead Counsel)
`USPTO Reg. No.: 32,044
`
`
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`Date: July 31, 2014
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