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`TY CORPORAT:
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`—against—
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`TANG'
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`Case No. 2—l2—CV—05680-AI
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`_______________________________________ X
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`I_.
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`I
`V
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`Philadelphia,
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`Pennsy'
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`van‘
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`Tuesday,
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`July 8, 20;
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`Reported by:
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`
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` ei,
`Rebecca Schaumlo
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`RPR, CLR
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`Job No:
`
`8l7ll
`
`TSG Reporting — Worldwide
`
`877—702—9580
`
`Target Corporation Exhibit 1155
`
`ngmv.DMC
`
`IPR2013-OO530, 531, 532, 533
`
`

`

`APPEARANCES:
`
`DLA PIPER
`
`Attorneys for the Plaintiff
`1650 Market Street
`
`Philadelphia, Pennsylvania 19103
`BY: MICHAEL BURNS IV, ESQ.
`
`FAEGRE BAKER DANIELS
`
`Attorneys for the Defendant
`300 North Meridian Street
`
`Indianapolis, Indiana 46204
`BY: DANIEL LECHLEITER, ESQ.
`MATTHEW ENNIS, ESQ.
`
`ALSO PRESENT:
`
`Matthew Smith, videographer
`*
`*
`*
`
`Page 5
`
`MR. BURNS: Michael Burns here
`
`on behalf of patent owner Destination
`Maternity Corporation.
`THE VIDEOGRAPHER: Thank you.
`Will the Court Reporter please
`swear in the witness.
`
`PHILIP GREEN, calledas a
`witness, having been first duly sworn by a
`Notary Public of the State of New York, was
`examined and testified as follows:
`EXAMINATION BY
`IVIR. LECHLEITER:
`
`Q. Good morning, Mr. Green.
`A. Good morning.
`Q. Thank you for providing your
`deposition today. I am Dan Lechleiter. As
`you may have just heard me say, I represent
`Target Corporation. Do you understand that
`Target is the Petitioner in these proceedings
`before the Patent Office?
`
`I do understand that, yes.
`A.
`Q. Okay. I understand you have been
`deposed in prior cases, so I think you kind
`of know how deositions work but I thouht I
`
`
`
`
`
`CO\IO‘\O‘|i-I>(JO[\)i—‘OKOCO\IO‘\O‘|i-I>UOI\)i—‘
`
`
`
`0"LB(A)[\Di—‘0KO
`
`(Pages 2
`
`to 5)
`
`TSG Reporting — Worldwide
`
`877—702—9580
`
`Target Corporation Exhibit 1155
`
`Target v. DMC
`
`IPR2013-OO530, 531, 532, 533
`
`mflmmibwmi—‘OKOCOQOWLTILDWNI—l
`
`
`
`
`
`July 8, 2014
`9:05 am.
`
`Videotaped deposition of PHILIP
`GREEN, held at the offices of DLA PIPER, LLP,
`
`1650 Market Street, Philadelphia, Pennsylvania,
`before Rebecca Schaumloffel, a Registered
`Professional Reporter, Certified Livenote
`Reporter and Notary Public of the State of
`New York and the State of New Jersey.
`
`THE VIDEOGRAPHER: This begins
`tape label number I of the videotaped
`deposition of Philip Green in the
`matter of Target Corporation V
`Destination Maternity Corporation for
`the United States Patent and Trademark
`
`Office. This deposition is being held
`at 1650 Market Street, in
`Philadelphia, Pennsylvania, on
`July 8th, 2014, at approximately
`9:05 am.
`
`My name is Matthew Smith for TSG
`Reporting, Incorporated. I am the
`legal video specialist. The Court
`Reporter is Rebecca Schaumloffel in
`association with TSG Reporting.
`Will counsel please introduce
`yourself for the record.
`l\/[R. LECHLEITER: Dan Lechleiter
`
`here on behalf of Petitioner, Target
`Corporation.
`MR. ENNIS: Matthew Ennis here
`
`on behalf of Petitioner Target
`oration.
`
` 2
`
`

`

`P. GREEN
`
`P. GREEN
`
`Page 6%
`
`CO\lO\Lfii—l>WNi—‘OKOCO\lO\Lfii-I>WI\DI—‘
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`
`
`
`
`the best way to proceed today.
`So can we agree to try to avoid
`speaking over each other?
`A. We can agree to try and do
`that, yes.
`Q. Okay. And if at any time you
`don't understand my question, please let me
`know, I will repeat it or ask the Court
`Reporter to repeat it.
`A. Okay.
`Q.
`If you need a break at any time,
`just let me know. I would prefer that we not
`break during a pending question, and if you
`need lunch later today, I am sure we can
`accommodate that and we will need lunch as
`
`well. So just, you know, keep us apprised of
`your needs.
`Is there any reason why you would
`be inhibited from providing full, truthful
`and accurate testimony today?
`A. Not that I am aware of, no.
`Q. You're not on any medications
`that would inhibit your testimony today?
`A. Not that I am aware of, no.
`
`P. GREEN
`
`received a degree in 1987.
`I then spent a couple of years
`working for an audit firm, which is called
`Ernst & Whinney, W-H-I-N-N-E-Y, which is now
`Ernst & Young. During that period of time, I
`was basically doing audits of big companies
`in New York City going from essentially tall
`building to tall building, had a variety of
`different audit clients. After a couple of
`years with Ernst & Whinney, I was fortunate
`enough to get a job working for a firm called
`Peterson Consulting. Peterson Consulting, at
`the time, was the largest independent
`litigation support firm in the country. It
`had 26 offices and maybe 5 or 600 employees
`at its biggest. At Peterson I did a variety
`of different things. Some investigations of
`failed banks and savings and loans.
`I did a
`number of patent infringement and other types
`of intellectual property infringement cases.
`I started doing valuation work at Peterson.
`I did a number of bankruptcies.
`I spent
`siX years there and then wound up getting an
`'
`to work at PriceWaterhouse which
`
`(Pages 6 to 9)
`
`TSG Reporting — Worldwide
`
`877—702—9580
`
`Target Corporation Exhibit 1155
`
`Target v. DMC
`
`|PR2013-OO530, 531, 532, 533
`
`(Niwai—‘OkOCO\lO\Lfli-I>WNi—‘OKOCO\lO\Lfli-I>WNi—‘
`
`
`
`
`
`would go over some of the procedural aspects
`just to make sure we are both comfortable
`with how everything will work.
`You understand you took an oath
`today, prior to beginning your testimony,
`that is the same as if you were to testify in
`court?
`
`A. Yes, I do understand that.
`Q.
`I am going to ask you a series of
`questions. You need to answer audibly so
`that we and the Court Reporter can hear you.
`Do you understand that?
`A. Yes.
`
`Q. Do you understand that nods of
`the head and un-un and shakes and nods are
`
`inaudible responses, aren't going to work
`today during the deposition, we need all
`responses to be audible?
`A. Yes, I understand.
`Q. Okay. I think in the course of
`the deposition, there is a chance that we or
`your counsel andI may try to speak over each
`other. Ithink if we can all try to avoid
`that to aid the Court Reporter, that would be
`
`Q. Any other reason that might
`inhibit your testimony today?
`A. Not that I can think of, no.
`
`I want to talk just a
`Q. Okay.
`little bit about your background, and I
`understand that you have been with your
`current employer since 1996?
`A. That's correct.
`I am one of the
`founders of the firm.
`
`Q. Can you talk me through your kind
`of undergraduate degree and progression
`forward in your career to your current
`career?
`
`I received an -- my
`Sure.
`A.
`undergraduate degree from Rutgers College at
`Rutgers University in 1984. My degree was in
`history. Thereafter, I spent about a year
`and a half working for a law firm in
`Washington DC. That firm was called
`Anderson Kill & Olick. After a couple of
`years with that firm, I decided to go and get
`an MBA, and I got that MBA at the Rutgers
`Graduate School of Management. And my MBA
`has a concentration in accountin and I
`
` 3
`
`

`

`P. GREEN
`
`P. GREEN
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`Page 10%
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`CO\lO‘\0‘|i-I>O)Ni—‘OKOCO\IO‘\O‘Ii-I>OONI—‘
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`e!"
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`
`
`is now PricewaterhouseCoopers, one of the big
`accounting firms, working in their dispute
`analysis and corporate recovery services
`practice. And at Peter -- excuse me, at
`PriceWaterhouse, I pretty much did
`two things.
`I worked on intellectual
`property disputes, really of all sorts. And
`then I was also working on a big bankruptcy
`involving Maxwell Communications. We may all
`remember Robert Maxwell owned the New York
`
`Post, Macmillan Publishing and stuff. He
`sort of fell off his boat in the mid '90s.
`
`That whole business kind of got sold off
`ultimately thereafter, and I was part of the
`team that was investigating the intercompany
`issues, the accounting issues as well as
`managing the wind down of those businesses
`and their sale.
`
`In 1996, I was asked by one of
`the senior partners in PriceWaterhouse, in
`the dispute analysis practice, a man named
`Corky Hoffman, C-O-R-K-Y, H-O-F-F-M-A-N, to
`form the firm that is my current employer,
`and I have been at that firm ever since.
`
`kind of thing.
`I also assist clients, various
`types of clients, with licensing issues, how
`to basically monetize their intellectual
`properties and convert their ideas into
`money, I guess is the best way of thinking
`about it.
`
`And then lastly, as a CPA, I do
`royalty audits, you know, people wind up
`saying I got this deal, I don't think I am
`getting paid what I think I should be paid or
`we are paying what we should be paying, what
`do we do. That kind of stuff.
`
`And the rest of it, the remaining
`20% of my practice revolves around things
`that accountants might think are fun or might
`be valuation related or transaction.
`
`In your work at Hoffman, can you
`Q.
`tell me how many times you have served as an
`expert witness in an intellectual property
`case?
`A. Over the course of the last
`
`18 years of the firm, I probably have
`testified a roximatel 100 times at a
`
`mflmmibWNi—‘OLOCOQOWWLBOJNH
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`
`
`
`Q. At Hoffman, can I call it
`Hoffman?
`A. Um-hum. Sure.
`
`Q. What has been the focus of your
`work at Hoffman?
`
`A. For the last 18 years at Hoffman
`Alvary and then the previous years from the
`time I was working at Peterson, about 80% of
`my practice at Hoffman Alvary has been
`related to -- things related to intellectual
`properties. And that kind of covers
`four different areas, if you will. One part
`of it is disputes where you wind up having
`infringements and measuring the damages from
`infringement.
`Another aspect of my work has
`been things that I will call valuation
`related things. So I'll value intellectual
`properties, but I have also been asked to do
`other kinds of analyses that relate to
`intellectual property. So I would consider
`analyzing commercial success, default into
`sort of like the category of, you know,
`somewhat valuation and somewhat litigation
`
`Page 13?
`
`deposition or at a trial on something that's
`intellectual property related.
`Q. And of those cases, how many were
`patent cases?
`A. Not knowing completely off the
`top of my head, I bet about 80% of those had
`something to do with a patent one way or
`another.
`
`So roughly 80 cases within
`Q.
`those 100?
`
`A. Would make sense, yeah.
`Q. Okay. In the course of your
`testimony in intellectual property cases,
`have you ever been disqualified as an expert?
`A.
`I have never been disqualified as
`an expert on a Daubert challenge. I have, to
`my knowledge, on three occasions had my
`testimony limited in District Court cases,
`primarily because the judge determined that
`some of the evidence that I was relying on
`wasn't going to be part of the evidence that
`we presented at trial, so the opinions that I
`was able to give would therefore no longer be
`available to resent to a '
`or a finder of
`
`(Pages 10 to 13)
`
`TSG Reporting — Worldwide
`
`877—702—9580
`
`Target Corporation Exhibit 1155
`
`Target v. DMC
`
`|PR2013-OO530, 531, 532, 533
`
` 4
`
`

`

`Page 14
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`Page 15
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`P. GREEN
`these motions. So there will be motions in
`
`limine, there will be Daubert motions. Those
`are the two that I'm most commonly familiar
`with. Probably happens in about half of the
`cases that I do regardless of the merits of
`the motions one way or another.
`Q. Thinking about the 80% of your
`cases that have been patent cases, do you
`know in roughly what percentage of those
`cases the side for which you provided
`testimony was victorious in the case?
`A.
`In other words, did they actually
`go all the way to jury or to a verdict?
`Q. Did they prevail on the issue for
`which you provided testimony?
`A. A good number of the patent cases
`that I have been in have settled, but in
`general, the intellectual property cases that
`I have worked on, either a plaintiff or a
`defendant, have resulted in the jury sort of
`uniquely siding with what I was saying. In
`other words, I can walk you through the list
`of cases that was attached to my report and I
`could show you in the trial testimonies how
`
`40 trials throughout my career. A little
`more than 40 trials throughout my career.
`And I would be willing to bet that of the 100
`so or depositions on intellectual property
`cases, there's probably been between 10 and
`20 trials that are intellectual property
`cases. So about half of my trial work.
`Q. And so you would have testified
`in each of those trials, is that right?
`A. Yes.
`
`Q. Okay. So ifit was 10 to 20,1
`just want to make sure the record is clear,
`if it was 10 to 20 trials, intellectual
`
`property cases, that would have meant that
`you have testified in somewhere between 80
`and 90 depositions based on the 100 number we
`were using earlier?
`A. Usually there is a deposition
`before a trial, so probably there is a bit of
`overlap. In other words, it is probably, of
`the 100 depositions, there is probably 20 --
`no more than 20 trials. Rarely do you have a
`situation where you don't give a deposition
`before a tria
`can think of one i stance
`
`5
`
`(Pages 14 to 17
`
`TSG Reporting — Worldwide
`
`877—702—9580
`
`Target Corporation Exhibit 1155
`
`Target v. DMC
`
`IPR2013-OO530, 531, 532, 533
`
`P. GREEN
`
`fact.
`
`Q. Of those three cases, were any of
`them patent cases?
`A. One was a patent case. One was a
`commercial dispute and the other was a false
`advertising claim.
`Q. Does the patent case, does that
`appear on your list of testimony provided
`with your eXpert report?
`A. The patent case that I am
`thinking about is —— the answer is yes, and
`it is ePlus versus Lawson.
`
`ePlus versus Lawson?
`Q.
`A. Correct.
`
`Q. What district was that in?
`A.
`It would have been in Eastern
`
`District of Virginia.
`Q. Have you ever been subject to any
`other form of disqualification, motion, other
`than a Daubert challenge?
`A.
`In the world of patent cases and
`intellectual property infringement, I think
`that for the most part it is practically
`malpractice for you guys to not actually file
`
`they all worked how, if that would be
`helpful, but for the most part, the juries
`have adopted what I have said.
`Q.
`In terms of --
`A. To the extent there is liability
`found or not liability found. I can't
`control the liability decisions.
`Q.
`So you've never opined on
`liability one way or the other?
`A. Not in a patent infringement
`case, no.
`
`So the testimony you are
`Q.
`referring to I am understanding to mean
`related to damages or lack thereof in a
`patent case?
`A. Correct.
`
`Q. Okay. Before you mentioned that
`you had provided testimony in either a trial
`or deposition in around 100 intellectual
`property cases. Of those instances in which
`you provided testimony, how many were in a
`deposition setting?
`A.
`I don't know exactly off the top
`of m hea
`have robabl d ne around
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`l 2 3 4 5 6 7 8 9
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`P. GREEN
`
`P. GREEN
`
`Page 18%
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`Page 19;
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`off the top of my head but that's about it.
`Q. Got it. Have you testified in
`any prior cases involving soft goods?
`A.
`Soft goods? In other words,
`things like clothing and that kind of stuff?
`Q. Yes.
`A. Yes.
`
`Q. And are those cases listed on
`your list of cases with your expert report?
`A. To the extent they have occurred
`since 2010, yes.
`Q.
`If they haven't occurred since
`2010, do you recall what the cases were
`called?
`
`I could take a stab at it, yeah.
`A.
`Q. What were they?
`A. The ones that come to mind are a
`
`case involving True Religion, the jeans
`manufacturer. Another one involving Forever
`21. I have done some work on behalf of an
`
`entity called 24/7, which places cutters and
`designers in the garment industry on a
`temporary basis down in their offices are
`based in Soho, in New York. I have done
`
`P. GREEN
`
`Q. Okay. And what opinion were you
`asked to provide in that case?
`A.
`I was asked to evaluate the
`
`damages suffered by the copyright holder, who
`I think was Anthropology in that case, and so
`it was an analysis of lost profits and in the
`alternative, unjust enrichment.
`Q. And you said you represented or
`you worked with Forever 21 in that case?
`A. No, I worked, I think, on behalf
`of Anthropology.
`Q. Forever 21 was the defendant?
`A. Correct.
`
`Q. Okay. You mentioned you worked
`for, you did work on a case involving True
`Religion?
`A. Correct.
`
`Q. Who was your client in that case?
`A. True Religion was the ultimate
`client.
`
`Q. Okay. And what was the nature of
`the case?
`A.
`It was a trademark case.
`And what 0 oinion wer
`
`ou asked
`
`l 2 3 4 5 6 7 8 9
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`cases involving copyrighted fabric patterns.
`Those are the ones that come to mind.
`
`Q. Were any of those patent cases?
`A.
`I've been trying to think about
`whether or not they were patent cases. To
`date, most of the things that I have done
`that involve clothing, I think are pretty
`much copyrights or trademarks. I mean,
`that's typically the intellectual property
`that winds up being applied to these things.
`At least in my —— in the cases I have done
`so far.
`
`So just talking through those, in
`Q.
`the Forever 21 case, who was your client in
`that case?
`A. Forever 21.
`
`Q. And what type of opinion were you
`asked to provide?
`A.
`It was either -- I think it was a
`
`trademark infringement. Somebody using
`something that was -- wait, Forever 21, that
`would have been, yeah, copyright, excuse me,
`that there would have been a patent in that.
`
`to provide in that case?
`A.
`It was a case involving
`essentially lost profits or lost royalties
`for the alternative and analysis of unjust
`enrichment by the infringer.
`Q. And then in the 24/7 case you
`mentioned, who did you work with there, who
`was your client?
`A. My client in that case was 24/7.
`Q. And what was the nature of that
`case?
`A. That case was a trade secret
`
`theft case involving essentially some people
`who left 24/7 to start their own competing
`operation, and they took essentially all the
`client list, both of customers that were
`being served by 24/7, so 24/7 was serving,
`you know, Ralph Lauren and all the major
`clothing designers in New York, essentially
`by providing them with temporary help, to
`do -- in the important seasons in the fashion
`business, and the defendants took off with
`the names of those clients and those related
`contacts as
`as the eo ule that the
`
`(Pages 18 to 21)
`
`TSG Reporting — Worldwide
`
`877—702—9580
`
`Target Corporation Exhibit 1155
`
`Target v. DMC
`
`IPR2013-OO530, 531, 532, 533
`
` 6
`
`

`

`P. GREEN
`
`P. GREEN
`
`Page 22
`
`Page 23;
`
`could place in the temporary business. So it
`started competing right away.
`Q. What was the nature of the
`opinion you were asked to provide?
`A. Again, lost profits and as
`measured by actually, 24/7's lost profits and
`the unjust enrichment that was earned by the
`trade secret theft. The people that stole
`the trade secrets. I will get that out.
`Q.
`So in each of those three cases,
`correct me if I am misstating this, you were
`asked to provide analysis of A, lost profits
`and B, unjust enrichment?
`A.
`So in the True Religion case, the
`correct measure of lost profits or lots
`royalties that they would be related to the
`use of a trademark. And in the other two, it
`was essentially the profits that would have
`been earned from actually physically making
`the sales that were made by the defendant.
`Q. And what quantitative factors did
`you consider in those analyses?
`A. Well, typically, although it is
`not the case law, and a trademark or a
`
`CO\lO‘\LfiiJ>LA)Ni—‘OKOCO\lO‘\CfiiJ>WNI—‘
`
`
`
`copyright infringement case or even a trade
`secret case, what you want do is sort of
`follow the factors that come up in panduit,
`P-A-N-D-U-I-T, which is, you know, relates to
`patent infringement damages. It's kind of
`common sense and what you're trying do is
`figure out whether or not the plaintiff could
`have made the infringer sales. Whether you
`can measure them. You know, whether or not
`there were alternatives that you needed to
`consider. That kind of stuff. So pretty
`straightforward.
`Q.
`In those analyses, do you
`consider any qualitative factors?
`A.
`I think that invariably you have
`you to consider qualitative factors. In all
`of these kinds of case.
`
`So in a lost profits situation,
`Q.
`what kinds of qualitative factors would you
`consider?
`
`A. Well, some qualitative factors
`would wind up being things like the way that
`the market is divided, so whether or not, you
`know, one company only serves people that
`
`"ci-
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`5 \
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`(Niwai—‘OkOCO\lO\Lfli-I>WNi—‘OKOCO\lO\Lfli-I>WNi—‘
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`are, you know, buying very high end goods
`versus whether or not the infringer stuff
`only goes to, you know, a lower end of the
`market. That's a qualitative analysis.
`Qualitatively we're trying to evaluate
`whether or not -- evaluate the nature of the
`
`competition. So you would try and see well,
`are there ten people competing or 20 people
`competing for the same sale and why is that.
`You try and evaluate seasonality, for
`example, that's a qualitative thing at times.
`Discount is a qualitative thing.
`I mean, you can evaluate whether
`or not the product is exactly the same in the
`sense of, you know, is one blouse the same as
`the next blouse. But I can only do that at a
`certain level that I think comes down to an
`
`infringement question or, you know, something
`that is sort of not in my area of expertise.
`Q.
`So -- but to look at -- let's go
`back to the quantitative factors, let's look
`at quantitative factors in those types of
`cases. What types of information do you
`examine or consider in arrivin at our
`
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`opinion?
`A. Varies from case to case. Market
`
`to market. What the things might be. I
`mean, I think the qualitative things are just
`understanding what the product is and the
`market is for it. You can quantitatively
`figure out, you know, the dollar values, but
`you may need to understand what it is that's
`motivating people to buy a particular
`product. That's a soft question. That's a
`qualitative question.
`Q.
`In those cases, how do you gain
`that understanding, through what means?
`A.
`It depends on the case. In
`certain instances when you are doing lost
`profits, you know, the mirror of the -- the
`evidence of sales or the actual sales is
`
`evidence of demand and you don't really have
`to do that much more.
`
`In other cases, you know, the
`average patent infringement case, lately
`there's been a whole sequence of need for
`surveys in copyright and trademark,
`articularl
`in trademark ou have this whole
`
`‘1
`g.
`,.
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`35
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`(Pages 22 to 25)
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`TSG Reporting — Worldwide
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`877—702—9580
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`Target Corporation Exhibit 1155
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`Target v. DMC
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`IPR2013-OO530, 531, 532, 533
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`

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`issue of confusion. That's typically a
`survey based question. You know, it really
`kind of varies from case to case and
`circumstance to circumstance.
`
`Q. How do you decide what
`information you would like to see in a lost
`profits situation?
`MR. BURNS: Objection to form.
`I know you are going through the
`background, but a lot of this stuff is
`outside the scope of his Declaration.
`I just want to put that on the record.
`A. Again, it really does vary case
`to case and circumstance to circumstance.
`
`Again, some things are really brutally
`obvious why it is selling. You know, it is
`the only drug that cures a particular form of
`cancer. You don't really have to think about
`it that hard.
`
`Other things, you know, whether
`or not the calendar feature in your phone is
`driving the decision for you to buy that
`phone and you'll wind up having to figure out
`essentially why that feature was put in there
`
`love seats and that kind of furniture. And
`
`early in my career, I did a bunch of cases
`involving, you know, sort of the street
`comer kind of copyright infringement cases
`that you wind up seeing in New York where
`people are, John Doe 1 through 50 who is
`knocking off Vuitton bags and that kind of
`stuff. So there were a number of those
`
`things early on.
`Q. And in the copyright cases, kind
`of a general grouping of copyright cases you
`just mentioned, what kind of opinions were
`you asked to provide?
`A. They were typically on the
`damages that would be arising from the
`infringements, so you would be looking at
`lost profits, reasonable royalties.
`Royalties or unjust enrichment, depending on
`the circumstances in the case.
`
`In any of the cases you have been
`Q.
`involved in involving soft goods, considering
`kind of the list we just discussed, did you
`conduct any consumer surveys as part of your
`anal sis?
`
`l 2 3 4 5 6 7 8 9
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`.4
`.5
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`and whether or not anybody cares or not.
`Q.
`So in that case you‘d have to
`drill down to the factors surrounding that
`particular feature?
`A. You can at times. Sometimes --
`
`in thinking about your phone, typically,
`that's part of the challenge of the analyses
`is to figure out the connection between the
`sale of the end product and the particular
`feature.
`
`So besides the Forever 21, True
`Q.
`Religion and 24/7 cases, were you involved in
`any other cases involving soft goods or
`clothing?
`A. Well, soft goods, you know, I
`think of fabric. I have done a bunch of
`
`fabric copyright cases over the years.
`Q. Do you recall the names of any of
`those cases?
`A. There's been at least two or
`
`three for a company called American Century,
`American Century Fabrics, and they sell
`fabrics that are mostly winding -- wind up
`being used in furniture. Sofas, couches,
`
`A. Me personally?
`Q. Well, let me rephrase that. Did
`you rely on any consumer surveys as part of
`your analysis?
`A.
`So in -- I think that in the
`
`Anthropology Forever 21 case, there was some
`kind of survey work done.
`I testified also,
`it's not quite a soft good but it is
`conceptually the same thing, in a case
`involving a trademark on -- a trademark
`design that was on paper. It was for a
`company called FiberMark, and I mean it is
`not quite soft goods in the sense of a
`clothing, but there, there was also a
`consumer survey to see whether or not that
`trademark, that model patenter, actually had
`established some kind of secondary meaning.
`But a lot of these other cases it
`
`is relatively clear that they are using the
`name or they're -- you don't really have to
`go that far to sort of recognize that there
`is infringement.
`Q.
`So I guess just to clarify, you
`recall
`'
`r rel
`i
`n ev'dence of a
`
`onl
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`(Pages 26 to 29)
`
`TSG Reporting — Worldwide
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`877—702—9580
`
`Target Corporation Exhibit 1155
`
`Target v. DMC
`
`IPR2013-OO530, 531, 532, 533
`
` 8
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`survey in one case?
`A. One or two cases. In general,
`like I said, these things really depend on
`the facts and circumstances of the cases and
`
`what the issue is with respect to what is
`being accused of infringement.
`Q. Have you ever testified in any
`prior cases involving maternity products in
`particular?
`A. The only -- the only thing that I
`can think of, and it is not really a
`maternity product, is that I worked on a case
`in our firm related to baby bassinets and a
`design of baby bassinets, but that's not
`quite the same thing. So I can't think of a
`particular maternity, directly maternity
`related case as I would define it.
`
`So no cases related to maternity
`Q.
`bottoms or pants?
`A. Not that I can think of. Not
`
`that I can think of sitting here. There may
`be. I would have to take a deep dive into
`the list.
`
`In any of your prior patent cases
`
`CO\lO\Lfii—l>WNl—‘OKOCO\lO\Lfii-I>UOI\DI—‘
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`
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`in which you have worked as an expert, did
`you provide any opinions on commercial
`success of a patented product?
`A. Well, yeah. I mean, I wind up
`having to provide opinions regarding
`commercial success really kind of in
`three contexts, yes.
`Q. What are those?
`A.
`So one context is if you look at
`Georgia Pacific, and virtually every case I
`do has a royalty analysis that needs to be
`done, a reasonable royalty analysis. There
`is always a discussion of commercial success
`and tying the patented feature to, or the
`patented product or the patents that are in
`suit, to the revenues and profits and other
`issues that are in the case or financial
`issues that are in the case that would result
`
`in a royalty. So hundreds of those. I am
`also regularly asked to value patents, and to
`be able to do that, you have to take a deep
`dive into the question of what's the
`connection between the patent and what the
`claims are and what the patent -- what the
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`patents do and how they would affect the
`marketplace.
`So you need to know the
`difference between whether or not, you know,
`on a pharmaceutical case whether the patent
`is on the actual drug itself or on, you know,
`the purple coating. There are different
`things.
`
`Lastly, I have been asked to
`provide opinions on commercial success in
`connection with cases where we are -- I'm
`
`evaluating secondary considerations, if not
`obviousness, and the circumstance similar to
`what we find ourselves in here today,
`evaluate for liberty of a patent.
`Q.
`So in that last case, the third
`of the three you mentioned, do you recall
`which cases in which you have provided
`opinions on commercial success in the
`secondary consideration context?
`A.
`I don't have the list in front of
`
`me. I can kind of give you a general
`recollection, sure.
`What's our eneral recollection?
`
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`I have given opinions regarding
`A.
`commercial success on a drug that's used to
`treat Pompe Disease. A drug that's used to
`treat Rosacea, microphones, little NEMS
`microphones, a drug that is used for
`migraine, a testosterone drug, and I believe
`there was one other that's a computer -- some
`kind of hardware related question. That's my
`recollection.
`
`In those cases, can you give me
`Q.
`an idea of what factors you considered to
`arrive at your opinions?
`A. Well, generally, when evaluating
`commercial success for secondary
`considerations of non-obviousness, what you
`are trying to do is, first off, figure out
`whether or not the product actually is
`successful, product practicing, the patented
`technology is successful, both in terms of
`dollar value of sales, profits or other
`regular financial measures, that an
`accountant or a finance guy would think of or
`that somebody who is inside of a company
`mi ht think of. And then what ou are t
`
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`,.
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`35
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`(Pages 30 to 33)
`
`TSG Reporting — Worldwide
`
`877—702—9580
`
`Target Corporation Exhibit 1155
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`Target v. DMC
`
`IPR2013-OO530, 531, 532, 533
`
`

`

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`basic financial question can be correlated or
`tied to the patented technology versus
`everything else.
`Q.
`In the drug cases -- well, let's
`back up.
`In the cases in which you have
`offered an opinion on commercial success in
`the secondary consideration context, of those
`cases, in how many was your opinion that
`there was in fact commercial success?
`A. Kind of worked both —— I worked
`
`both sides of the street on this question, if
`you will. So probably three and three. If I
`gave you a list of six, it is probably three
`and three. Or it might be four and two. But
`it is something like that. It is not
`disproportionate either way.
`Q. And when you -- and so,
`hypothetically saying there were six prior
`case in which you provided an opinion on
`commercial success in the secondary
`consideration context, in the cases in which
`you didn't find that there was commercial
`success, what were the factors that led you
`
`"ci-
`
`
`
`to do is, essentially, prove the negative of
`whether or not other things were actually
`driving those sales and profits, to the
`extent that there are any that are related to
`the patented products, that are unrelated to
`the patents.
`In other words, you are looking
`at nexus. So in a pharmaceutical case, there
`is often a discussion about whether or not
`
`advertising is driving the sales, and it is
`not the invention of the pill, it is the fact
`that it is, you know, on television 23 times
`a day and there is, you know, a butterfly
`with purple wings. We can all see those
`drugs, and they apparently have big sales,
`but a lot of it is because of the consumer
`
`CO\lO‘\0‘|i-I>OONI—‘OKOCO\IOWO‘|i-I>OOI\DI—‘
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`demand driven by the advertising.
`So, you know, are there other
`factors, maybe a rapid changein demographics
`or was there hurricane. Or, you know, who
`knows. You can just imagine.
`So the idea is to figure out
`whether or not the sales and the returns that
`
`one has been able isolate in the financial,
`
`to that conclusion?
`A. That there were outliers in terms
`
`of advertising. That the -- in other words,
`the drug -- if it was a pharmaceutical, you
`know, they had spent for every dollar of
`revenue, they'd spent $4 on advertising,
`which is not how this game usually gets
`played as far as the pharmaceutical companies
`go. Or that the patented technology was
`clearly not something that was front and
`center in the way that a product was being
`marked or sold. So to the extent it was an
`
`electronic device and you're talking about,
`you know, some little switch on the side that