IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`_________________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`_________________
`
`Paper No. __
`
`
`
`
`
`
`TARGET CORPORATION
`Petitioner
`
`v.
`
`DESTINATION MATERNITY CORPORATION
`Patent Owner
`
`__________________
`
`Case IPR2013-00533
`Patent No. RE43,531 E
`__________________
`
`Filed: September 16, 2014
`
`
`
`
`
`Before JENNIFER S. BISK, MICHAEL J. FITZPATRICK, and
`MITCHELL G. WEATHERLY, Administrative Patent Judges.
`
`PETITIONER’S OPPOSITION TO PATENT OWNER’S MOTION
`FOR OBSERVATION REGARDING CROSS-EXAMINATION
`OF REPLY WITNESS
`
`
`_________________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`_________________
`
`Paper No. __
`
`
`
`
`
`
`TARGET CORPORATION
`Petitioner
`
`v.
`
`DESTINATION MATERNITY CORPORATION
`Patent Owner
`
`__________________
`
`Case IPR2013-00533
`Patent No. RE43,531 E
`__________________
`
`Filed: September 16, 2014
`
`
`
`
`
`Before JENNIFER S. BISK, MICHAEL J. FITZPATRICK, and
`MITCHELL G. WEATHERLY, Administrative Patent Judges.
`
`PETITIONER’S OPPOSITION TO PATENT OWNER’S MOTION
`FOR OBSERVATION REGARDING CROSS-EXAMINATION
`OF REPLY WITNESS
`
`
`
`
`
`I.
`
`II.
`
`TABLE OF CONTENTS
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`STATEMENT OF RELIEF REQUESTED .................................................... 1
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`RESPONSE IN OPPOSITION TO DMC’S OBSERVATIONS .................... 1
`
`A.
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`B.
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`Thomas Does Not Offer Legal Opinions .............................................. 1
`
`Thomas Properly Considered the Subject Matter of the Claims
`Rejected for Obviousness in These Proceedings .................................. 2
`
`C.
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`Thomas’s Opinion Finds, in Part, that the
`
`
`
`
`
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` ............................................ 7
`
`
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`..................................... 9
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`D.
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`Thomas’s Declaration Supports that
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`E.
`
`F.
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`Thomas Properly Considered the Factors Supported by the
`Available Evidence .............................................................................. 10
`
`Thomas Does Not “Misquote[] Deposition Testimony”..................... 10
`
`III. CONCLUSION .............................................................................................. 11
`
`US.54879105.01
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`-i-
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`I.
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`STATEMENT OF RELIEF REQUESTED
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`Petitioner Target Corporation (“Target” or “Petitioner”) hereby opposes
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`Patent Owner Destination Maternity Corporation’s (“DMC” or “Patent Owner”)
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`Motion for Observation Regarding Cross-Examination of Reply Witness (Paper
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`47) (“Motion for Observation”) and requests that the Board deny the Motion for
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`Observation in all respects.
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`II. RESPONSE IN OPPOSITION TO DMC’S OBSERVATIONS
`As a preliminary matter, DMC’s Motion for Observation should be rejected
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`as procedurally improper. A motion for observation on cross examination should
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`be filed only where the filing “party does not believe a motion to exclude the
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`testimony is warranted.” See OFFICE PATENT TRIAL PRACTICE GUIDE, 77 Fed. Reg.
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`48,756, at 48,767-68 (Aug. 14, 2012). DMC filed a Motion to Exclude that seeks,
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`in part, to exclude Thomas’s testimony. (Paper 49, at 3-7.) As such, the Board
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`should deny DMC’s redundant Motion for Observation.
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`Below, Target responds to DMC’s observations in the same order as they are
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`raised in DMC’s Motion for Observation.
`
`A. Thomas Does Not Offer Legal Opinions
`The testimony DMC cites in Part II.A of its Motion for Observation is
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`relevant in these proceedings, if at all, only to confirm that Thomas does not
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`purport to opine on the law or provide legal opinions, as further discussed in
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`US.54879105.01
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`Target’s Opposition to Patent Owner’s Motion to Exclude Evidence, filed
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`contemporaneously herewith. Target disagrees that any aspect of the Thomas
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`Declaration “should be given no weight if admissible.”
`
`B.
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`Thomas Properly Considered the Subject Matter of the Claims
`Rejected for Obviousness in These Proceedings
`
`The testimony DMC cites in Part II.B of its Motion for Observation is not
`
`relevant for any of the reasons DMC provides. Thomas’s declaration correctly sets
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`forth the legal framework for analyzing commercial success. (See Ex. 1110, ¶¶ 19-
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`22.) And in his deposition, for example, Thomas made clear that
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`(Ex. 2099, at 38:16-41:5.) Thomas’s understanding is reflected more generally in
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`his report, in which he states, for example:
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`US.54879105.01
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`(Ex. 1110, ¶¶ 23.) Indeed, Thomas understands
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` (Ex. 2099, at 22:15-
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`23:18.) Thus, to the extent the Board admits any of the testimony cited by DMC, it
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`should also admit the testimony at Ex. 2099, pages 22:15-23:18.
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`It is not Thomas but DMC who does “not understand the legal framework
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`for analyzing dependent claims” whose obviousness is at issue. (See Paper 47, at
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`3.) In an attempt to support admitting the cited testimony in this proceeding,
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`DMC’s Motion for Observation misstates the law of nexus in the commercial
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`success context. DMC appears to believe that it can obtain the benefit of a
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`“presumption” of a nexus
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`
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`.1 (See Paper
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`47, at 1-4.) DMC is incorrect for several reasons, each of which shows that the
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`cited testimony is not relevant for the purposes that DMC specifies:
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`1 U.S. Patent Nos. RE43,531 (“’531 Patent”) and RE43,563 (“’563 Patent”).
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`US.54879105.01
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`-3-
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`First, claim 1 in each patent, among other claims, is subject to an
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`anticipation rejection in these proceedings. (IPR2013-00530, Paper 13, at 22;
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`IPR2013-00531, Paper 10, at 29; IPR2013-00532, Paper 10, at 23; IPR2013-
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`00533, Paper 11, at 25.) Where commercial success evidence relates only to an
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`independent claim rejected for anticipation that underlies a dependent claim
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`rejected for obviousness, there is no nexus to the dependent claim. In re Paulsen,
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`30 F.3d 1475, 1482 (Fed. Cir. 1994). Thus, whether elements of claim 1 may be
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`embodied in DMC’s
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` products does nothing
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`to show that
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` was “attributable to,” or even related to, elements
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`of the dependent claims that are subject to obviousness rejections in these
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`proceedings. See id. (“AST limits its argument respecting the evidence adduced to
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`demonstrate nonobviousness to laptop computers covered by [independent] claims
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`1 and 18, claims which we have previously concluded are unpatentable under
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`section 102. AST has not established that the commercial success . . . experienced
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`by Grid laptop computers are probative of the nonobviousness of the inventions of
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`[dependent] claims 2-4, 6, and 28-34. It has not been shown that such evidence is
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`relevant to a computer within the scope of these claims, i.e., that it is attributable to
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`the inventions of these claims, rather than . . . to the features possessed by the
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`computers of [independent] claims 1 and 18.”).
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`Second, “[a] prima facie case of nexus is generally made out when the
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`US.54879105.01
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`patentee shows both that there is commercial success, and that the thing (product
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`or method) that is commercially successful is the invention disclosed and claimed
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`in the patent” and is “coextensive with the patented invention.” Demaco Corp. v.
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`F. Von Langsdorff Licensing Ltd., 851 F.2d 1387, 1392 (Fed. Cir. 1988); Brown &
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`Williamson Tobacco Corp. v. Philip Morris Inc., 229 F.3d 1120, 1130 (Fed. Cir.
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`2000). The coextensivity requirement is separate from, and means something more
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`than, the requirement that the patent claims at issue cover, or read on, the
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`commercial product in question. See id.; Rambus, Inc. v. Hynix Semiconductor,
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`254 F.R.D. 597, 602 (N.D. Cal. 2008) (“The reason for the first part of this inquiry
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`is obvious: . . . If the product does not read on the claim, there can be no relevance
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`of the product’s commercial success to whether the claim is obvious or not.”).
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`Indeed, “for a presumption [of nexus] to attach, the patentee must also show that
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`the claimed invention is ‘coextensive’ with the product.” Id. As the Rambus court
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`explained:
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`Th[e coextensivity] requirement accommodates the reality that many
`products embody dozens of patents or features and that their success
`or failure cannot solely be attributed to any particular one. Where the
`product is coextensive with the claimed invention, for example, where
`the product might be a pharmaceutical compound and the claimed
`invention the active ingredient, the patentee’s evidence of the
`commercial success of the product is relevant to obviousness. . . .
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`US.54879105.01
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`-5-
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`Where the product is not coextensive with the claimed
`invention, this chain of reasoning breaks down. For example, if a
`product embodies several claimed inventions, why should any one
`invention be presumed to be the cause of its success? Put another
`way, how could one tell that the product’s success was due to the
`claimed invention at issue and not the collective utility of the other
`inventions? Thus, where the product is not coextensive with the
`claimed invention, the patentee must show more to establish the chain
`of inference that suggests that the claimed invention is non-obvious.
`This showing can take many forms, but it must explain how the
`product’s commercial success was caused, at least in part, by the
`claimed invention and not by “other economic and commercial factors
`unrelated to the technical quality of the patented subject matter.”
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`254 F.R.D. at 602 (quoting Cable Elec. Prods., Inc. v. Genmark, Inc., 770 F.2d
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`1015, 1027 (Fed. Cir. 1985)) (internal citations omitted).
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`DMC wholly ignores the Federal Circuit’s coextensivity requirement, which
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`precludes a presumption of nexus here, because DMC has failed to show that any
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`elements unique to the § 103-Rejected Claims, (see Paper 42, at 5),
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`. See Demaco, 851
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`F.2d at 1392 (“When the thing that is commercially successful is not coextensive
`
`with the patented invention—for example, if the patented invention is only a
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`component of a commercially successful machine or process—the patentee must
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`show prima facie a legally sufficient relationship between that which is patented
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`US.54879105.01
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`-6-
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`and that which is sold.”); Paulsen, 30 F.3d at 1482 (evidence of purported
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`“commercial success” must be “attributable to the inventions of the[] claims”
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`subject to rejection for obviousness).
`
`Finally, DMC’s own arguments for the relevance of the cited testimony are
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`inconsistent. DMC argues, on the one hand, that “each claim must be considered
`
`as defining a separate invention,” (Paper 47, at 4), but then argues that the
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`dependent claims subject to obviousness rejections in these proceedings
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`collectively constitute “the ‘invention as a whole’” for obviousness purposes, (id.
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`(emphasis omitted)). DMC cannot aggregate its claims into a single “invention”
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`for purposes of analyzing the obviousness of any particular claim. Indeed,
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`obviousness, including any proffered secondary considerations, such as purported
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`“commercial success” and the related issue of nexus, must be analyzed on a claim-
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`by-claim basis. MeadWestVaco Corp. v. Rexam Beauty & Closures, Inc., 731 F.3d
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`1258, 1264–65 (Fed. Cir. 2013); Paulsen, 30 F.3d at 1482.
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`C. Thomas’s Opinion Finds, in Part, that the
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`
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`The testimony DMC cites in Part II.C of its Motion for Observation is not
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`relevant to any issue at hand for several reasons:
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`First, Thomas’s testimony in his declaration speaks for itself; his opinions
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`are limited and focused on
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`US.54879105.01
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`-7-
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`. (See generally
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`Ex. 1110.) What Thomas arguably “[d]id [n]ot [o]pine” on is simply not relevant.
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`Second, DMC improperly attempts to derive from Thomas’s testimony
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`reasons for which DMC may have acted in a certain way relative to its maternity
`
`pant product lines. (See Ex. 2099, at 122:2-18, 123:9-17.) As Thomas’s
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`subsequent testimony makes clear, however,
`
`
`
` (See id. at 122:19-130:25.) Thus, to the extent the Board admits any
`
`of the testimony cited by DMC, it should also admit the testimony at Ex. 2099,
`
`pages 122:19-130:25.
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`Third, as discussed above, see supra Part II.B, DMC misunderstands and
`
`misapplies the law of nexus, incorrectly assuming
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`that “there is a
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`presumption of nexus” here. (Paper 47, at 11.) Indeed, there is no such
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`presumption here, because DMC has failed to show
`
`
`
`
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`. See Demaco, 851 F.2d at 1392; Paulsen, 30 F.3d at
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`1482; Rambus, 254 F.R.D. at 602.
`
`
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`US.54879105.01
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`-8-
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`D. Thomas’s Declaration Supports that
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`The testimony DMC cites in Part II.D of its Motion for Observation is not
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`relevant to any issue at hand. Thomas’s testimony in his report speaks for itself.
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`Thomas’s Declaration contains page after page of detailed analysis, based on facts,
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`supporting and explaining his opinions. DMC’s argument that “Mr. Thomas did
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`no independent commercial success analysis to rebut Mr. Green,” (see Paper 47, at
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`12), is simply wrong. Among other analyses that are readily apparent in his
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`declaration, Thomas analyzed numerous DMC documents, including the
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`transcripts of depositions of DMC personnel, which contain information
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`contradictory to Green’s opinions but which Green failed to consider. (See, e.g.,
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`Ex. 1110, ¶¶ 41-43.) Indeed, that Green allegedly lacked “any evidence at all that
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`there would be any reason to believe that any other factors were present” to affect
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`his opinions, (see Paper 47, at 12), was a deficiency that DMC was in the unique
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`position to cure—instead, DMC apparently chose to hand Green what amounted to
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`a carefully selected, closed universe of materials to support his opinion. Thus,
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`especially in this case, simply because a portion of Thomas’s analysis focuses on
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`what Green ignored, or what DMC failed to provide to Green, does not mean that
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`Thomas “did no independent commercial success analysis to rebut Mr. Green.”
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`Moreover, Thomas’s opinion is replete with evidence and is itself offered to “help
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`US.54879105.01
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`-9-
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`the trier of fact to understand the evidence or to determine a fact in issue, see FED.
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`R. EVID. 702(a); i.e., whether sufficient facts exist
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`. (See generally Ex. 1110.)
`
`E.
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`Thomas Properly Considered the Factors Supported by the
`Available Evidence
`
`The testimony DMC cites in Part II.E of its Motion for Observation is not
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`relevant for any of the reasons DMC provides. Thomas’s testimony in his report
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`speaks for itself. Thomas’s declaration correctly sets forth the proper legal
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`framework for analyzing commercial success, including the factors that should be
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`considered in the analysis. (See Ex. 1110, ¶¶ 19-22). Thomas’s responses to the
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`vague hypotheticals posed to him during his deposition regarding
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`
`, (see Ex. 2099, at
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`46:15-49:13), do not somehow override the correctness of the proper legal
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`framework he sets forth—and applies—throughout his report with respect to the
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`actual products and available sales data and other facts here.
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`Thomas Does Not “Misquote[] Deposition Testimony”
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`F.
`The testimony DMC cites in Part II.F of its Motion for Observation is not
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`relevant for any of the reasons DMC provides. Although a citation error was
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`discovered in Thomas’s report during his deposition, he subsequently provided
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`testimony correcting the error and identifying the correct citation. (See Ex. 2099,
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`at 238:13-240:11, 262:23-273:10.) The incorrect citation did not fully support the
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`US.54879105.01
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`-10-
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`proposition for which it was cited, but the correct citation, to which Thomas
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`testified, does. (See id.) Therefore, to the extent the Board admits any of the
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`testimony cited by DMC, it should also admit the testimony at Ex. 2099, pages
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`238:13-240:11 and 262:23-273:10.
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`III. CONCLUSION
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`
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`The Board should deny DMC’s Motion for Observation in all respects.
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`Dated: September 16, 2014
`
`By:
`
`
`
`/s/ Norman J. Hedges
`Norman J. Hedges (Reg. No. 44,151)
`FAEGRE BAKER DANIELS LLP
`300 N. Meridian St., Ste. 2700
`Indianapolis, IN 46204-1750
`Telephone: 317-237-0300
`Facsimile: 317-237-1000
`Norman.Hedges@FaegreBD.com
`
`US.54879105.01
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`-11-
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`CERTIFICATE OF SERVICE
`
`Pursuant to 37 C.F.R. § 42.6(e), I hereby certify that I caused a true and
`correct copy of the foregoing Petitioner’s Opposition to Patent Owner’s Motion for
`Observation Regarding Cross-Examination of Reply Witness to be served via e-
`mail, as a PDF file attachment, on September 16, 2014, on the following:
`
`Paul A. Taufer
`Michael L. Burns
`DLA PIPER LLP (US)
`One Liberty Place
`1650 Market St., Ste. 4900
`Philadelphia, PA 19103-7300
`Telephone: (215) 656-3385
`Facsimile:
`(215) 606-3385
`Paul.Taufer@dlapiper.com
`Michael.Burns@dlapiper.com
`
`Stuart E. Pollack
`DLA PIPER LLP (US)
`1251 Avenue of the Americas
`27th Floor
`New York, NY 10020-1104
`Telephone: (212) 335-4964
`Facsimile:
`(212) 884-8464
`Stuart.Pollack@dlapiper.com
`
`By:
`
`
`
`/s/ Norman J. Hedges
`Norman J. Hedges (Reg. No. 44,151)
`FAEGRE BAKER DANIELS LLP
`300 N. Meridian St., Ste. 2700
`Indianapolis, IN 46204-1750
`Telephone: 317-237-0300
`Facsimile: 317-237-1000
`Norman.Hedges@FaegreBD.com
`
`
`
`Dated: September 16, 2014
`
`US.54879105.01
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