UNITED STATES PATENT AND TRADEMARK OFFICE
`
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`____________
`
`J SQUARED, INC. d/b/a UNIVERSITY LOFT COMPANY,
`
`Petitioner,
`
`v.
`
`SAUDER MANUFACTURING COMPANY,
`
`Patent Owner.
`
`____________
`
`Case IPR2015-00774
`
`U.S. Patent No. 8,585,136
`
`____________
`
`EXHIBIT 1028
`
`
`
`Please note that at page 23 of the transcript, Patentee indicated it would provide a
`
`redacted version, which has not yet been received. Thus, a redacted version will be
`
`uploaded when provided.
`
`

`
`Confidential
`
`Page 1
`
` UNITED STATES PATENT AND TRADEMARK OFFICE
` BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`J SQUARED, INC. d/b/a )
`UNIVERSITY LOFT COMPANY, )
` )Case IPR2015-00774
` Petitioner, )Case IPR2015-00958
` )Patent 8,585,136
` vs. )
` )
`SAUDER MANUFACTURING )Oblon Docket No.:
`COMPANY, )464032US and
` )464045US
` Patent Owner. )
`----------------------------)
`
` CONFIDENTIAL
`
` DEPOSITION OF PHILIP E. BONTRAGER
` Troy, Michigan
` Thursday, January 21, 2016
`
`Reported by:
`Paula S. Raskin, CSR-4757
`JOB NO. 102145
`
`TSG Reporting - Worldwide (877) 702-9580
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`J Squared Exhibit 1028, pg. 1
`J Squared vs. Sauder
`IPR2015-00774
`PARTIES AND BOARD ONLY
`
`

`
`Page 3
`
`A P P E A R A N C E S:
`
` OBLON, MCCLELLAND, MAIER & NEUSTADT
` Attorneys for Petitioner
` 1940 Duke Street
` Alexandria, Virginia 22314
` BY: SCOTT MCKEOWN
` RUBY NATNITHITHADHA
`
`and
`
` BAHRET & ASSOCIATES
` Attorney for Petitioner
` 320 North Meridian Street
` Indianapolis, Indiana 46204
` BY: WILLIAM BAHRET
`
` YOUNG BASILE HANLON & MACFARLANE
` Attorneys for Patent Owner
` 3001 West Big Beaver Road
` Troy, Michigan 48084
` BY: THOMAS YOUNG
`
`Page 5
`
` PHILIP E. BONTRAGER
`Natnithithadha. Let me spell that,
`N-A-T-N-I-T-H-I-T-H-A-D-H-A, and I work at
`Oblon with Scott McKeown.
` MR. MCKEOWN: Mr. Bontrager, I know
`you've attended some of the other
`depositions today so -- excuse me --
`earlier this week so I think we can
`dispense with some of the formalities, but
`have you been deposed before?
` THE WITNESS: I have.
` MR. MCKEOWN: Okay. So let's just
`make sure we answer clearly and no
`gesticulations so we can create the record.
`Okay?
` THE WITNESS: I understand.
` MR. MCKEOWN: Of course, if you need
`a break, please just ask for one.
` THE WITNESS: Thank you.
` I have some modest corrections and
`clarifications that I'd like to get into
`the record in my declaration, if I might,
`please.
` MR. MCKEOWN: Sure. Well, before we
`get to that, why don't I give you a copy of
`
`Confidential
`Page 2
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` January 21, 2016
` 9:35 a.m.
`
` Deposition of PHILIP E. BONTRAGER,
`held at the offices of Young Basile Hanlon
`& MacFarlane, PC, 3001 West Big Beaver
`Road, Suite 624, Troy, Michigan, before
`Paula Raskin, CSR-4757, a Notary Public of
`the State of Michigan.
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`Page 4
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`P H I L I P E. B O N T R A G E R,
` called as a witness, having been duly sworn
` by a Notary Public, was examined and
` testified as follows:
` MR. MCKEOWN: Good morning. Can you
` state your name for the record, please.
` THE WITNESS: I am Philip E.
` Bontrager, and I'm the president and CEO of
` Sauder Manufacturing since October of 2005.
` MR. MCKEOWN: Okay. Why don't we
` enter appearances again just for the sake
` of the record. The gentleman to your left,
` I guess.
` MR. YOUNG: I'm Thomas Young. I'm
` attorney for Sauder Manufacturing Company
` and the witness.
` MR. MCKEOWN: I'm Scott McKeown of
` the Oblon firm in Alexandria, Virginia. I
` represent University Loft in this
` proceeding. And to my immediate right
` is...
` MR. BAHRET: Bill Bahret from
` Indianapolis. I represent the petitioner,
` University Loft Company.
` MS. NATNITHITHADHA: My name is Ruby
`
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`TSG Reporting - Worldwide (877) 702-9580
`
`2
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`J Squared Exhibit 1028, pg. 2
`J Squared vs. Sauder
`IPR2015-00774
`PARTIES AND BOARD ONLY
`
`

`
`Confidential
`Page 6
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` PHILIP E. BONTRAGER
` your declaration so we're all talking about
` the same thing.
` EXAMINATION
`BY MR. MCKEOWN:
` Q. So I've handed you Exhibit 2008,
`which from IPR 2015-774, and you've also
`submitted a declaration in IPR 2015-958. I
`believe those are identical, so I won't give
`you a second copy. Is that your understanding?
` A. That would be my understanding. And
`I'm going to be citing my clarifications from a
`copy that I brought with me that is also
`labeled Exhibit 2008 from IPR 2015-00774.
` Q. Okay.
` A. First of all, on Page 30 of 102, at
`the bottom of the page, Footnote 31, just a
`clarification of the language. I would like to
`change the footnote to read:
` "Lower portion is described in the
`'136 patent. My interpretation begins on
`Page 40 of this declaration."
` Q. Okay.
` A. The second correction/clarification
`that I'd like to read into the record is on
`
`Page 8
`
` PHILIP E. BONTRAGER
` A. That is correct.
` Q. And how long have you been employed
`by Sauder?
` A. I had been at Sauder Woodworking,
`which is our parent company, since 2003. I
`transferred to Sauder Manufacturing in October
`of 2005, and have been in my current role since
`that time.
` Q. And as you say, your current role
`is?
` A. I am the president and chief
`executive officer of Sauder Manufacturing
`Company.
` Q. At Page 3 of your declaration, it
`looks like the first full paragraph below the
`bullet points, you state that you hold a
`master's in business administration with
`distinction from the Ross Graduate School of
`Business, the University of Michigan; and a
`bachelor of arts, economics, from Goshen
`College. Is that correct?
` A. That is correct.
` Q. Is that the entirety of your formal
`education?
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`Page 7
`
` PHILIP E. BONTRAGER
`Page 76, and this concerns the Yu patent.
` Page 76, at top of the page, the
`first line in the second paragraph, I would
`like to correct the last number in that line
`from number 24 to number 40. So the last
`phrase should read "when the plates 2340 are
`joined by fastener bolts."
` And then in the subsequent
`paragraph, in the second line of that third
`paragraph, I would like to correct the word
`"cover" to "support," so that beginning with
`the second line, "support plate 23. Support
`plate 23 as depicted in Figure 3."
` Those are two corrections from
`errors I committed when I typed my declaration.
` Q. Okay. Are those the only changes?
` A. Those are the only ones. There's a
`few other miscellaneous typos, but they're not
`material in terms of the understanding or
`interpretation of what's in the declaration.
` Q. Understood. So, Mr. Bontrager, as
`you stated at the outset, you are currently
`employed by Sauder Manufacturing. Is that
`correct?
`
`Page 9
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` PHILIP E. BONTRAGER
` A. Well, I have elementary school and
`high school. But in terms of post high school
`graduation, apart from periodic seminars,
`workshops, professional development, that would
`constitute my formal education, yes.
` Q. On the next page, Page 4, you
`state -- well, at the end of the second
`paragraph, the last sentence, sort of the last
`clause:
` "I have gained significant
`experience in design and manufacture of
`institutional furniture."
` Could you expand upon what you mean
`by institutional furniture?
` A. Yes. Institutional furniture in the
`trade would be furniture that is sold to
`commercial customers as opposed to residential
`furniture. So it's probably best talked
`about -- or part of talking about it is
`describing what it is not.
` It is not furniture that is sold
`typically via retail stores or furniture stores
`for use in private consumer residences. Rather
`it is furniture that is sold into a variety of
`
`TSG Reporting - Worldwide (877) 702-9580
`
`3
`
`J Squared Exhibit 1028, pg. 3
`J Squared vs. Sauder
`IPR2015-00774
`PARTIES AND BOARD ONLY
`
`

`
`Confidential
`Page 10
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` PHILIP E. BONTRAGER
`commercial establishments, the for-profit and
`not-for-profit, that would be considered
`institutions.
` It would be -- the term would be
`used interchangeably with contract furniture.
`For example, the furniture in this room would
`be considered institutional furniture or
`contract furniture.
` Q. And contract furniture refers to the
`manner in which it's sold? The channels in
`which it's sold?
` A. It would refer to a combination of
`both the specifications, the design, the sales
`channels, the sales conditions under which it
`is sold.
` Q. And is that institutional
`furniture -- just referencing Page 5, you refer
`to Sauder Manufacturing as America's largest
`manufacturer of ready-to-assemble residential
`furniture. Is that something different than
`institutional furniture?
` A. Yes. Sauder Woodworking is the
`manufacturer of ready-to-assemble furniture.
`We are a wholly owned and independently
`
`Page 12
`
` PHILIP E. BONTRAGER
`employment with the Hill-Rom Company, and you
`state that Hill-Rom Company's -- you served as
`a senior executive of the Hill-Rom Company's
`hospital patient room furniture business.
` A. Yes.
` Q. Can you give me a little bit more
`detail on what that business was?
` A. Well, if you -- I'll refer you back
`to Page 2 and Page 3 of the same declaration.
` Q. Uh-huh.
` A. At the time that I worked at
`Hill-Rom, it was a wholly owned subsidiary of
`Hillenbrand Industries with more than $1.2
`billion in global revenue. Hillenbrand was a
`publically traded company. Today Hill-Rom
`continues to be a public company and is
`independent of Hillenbrand Industries.
` At the top of Page 3, I note in my
`declaration that I had several different roles,
`and the time frames, the nature of the overall
`roles are described there.
` Working from the most recent to the
`oldest, from 1997 to 1999, I was the vice
`president and general manager for architectural
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` PHILIP E. BONTRAGER
`operated subsidiary of Sauder Woodworking. We
`have one of our plants that is on the same
`campus as Sauder Woodworking. Our operations,
`our customers, our sales force, our product
`development efforts are independent.
` As I tell some people, on one campus
`we share a dust collection system, and that's
`about the extent of what we share.
` Q. Do you know what percentage of
`products of Sauder Manufacturing are
`constructed of wood?
` A. Historically a hundred percent of
`them would have been constructed predominantly
`of wood and wood products.
` Today many of our products -- the
`majority of our products, overwhelming majority
`of our products, would still contain wood in
`one form or another, but not all of them. They
`would also contain plastic, they would contain
`wood, they would -- or excuse me -- metal, they
`would contain urethane, they contain fabrics.
`They have many different materials included in
`them beyond just wood.
` Q. On Page 4 you mention your previous
`
`Page 13
`
` PHILIP E. BONTRAGER
`products, which was the portion of the business
`that manufactured medical gas products in
`modular headwalls that go into patient rooms to
`deliver medical gases to the patient, as well
`as into operating rooms.
` From 1993 to 1997, I was the vice
`president and general manager for Hill-Rom's
`European therapy bed business and had overall
`responsibility across seven countries and full
`profit and loss responsibility for that
`business.
` And then from '86 to 1993, I was a
`vice president of business strategy for
`Hill-Rom's worldwide hospital furniture and
`medical device business.
` Q. Did Hill-Rom make furniture for
`businesses outside of the hospital and medical
`industry?
` A. No. Hill-Rom manufactured hospital
`furniture predominantly in the acute care
`marketplace. There was a smaller portion that
`was used in long-term care facilities, and
`there was yet a third portion that -- whose
`products were designed and developed for and
`
`TSG Reporting - Worldwide (877) 702-9580
`
`4
`
`J Squared Exhibit 1028, pg. 4
`J Squared vs. Sauder
`IPR2015-00774
`PARTIES AND BOARD ONLY
`
`

`
`Confidential
`Page 14
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` PHILIP E. BONTRAGER
`marketed to use in the home care environment
`for patients that were covered under a Medicare
`Part B reimbursement in the home setting for
`their delivery of care.
` Q. Did Hill-Rom manufacture any
`furniture that would have been directed to the
`education market?
` A. Hill-Rom did not manufacture for the
`education market.
` Q. I'm handing you an exhibit marked
`1001.
` MR. MCKEOWN: I assume you have
` copies of this by now, Tom.
` MR. YOUNG: Yes. You're good.
` Q. Do you recognize this exhibit?
` A. I do.
` Q. What is it?
` A. It is the -- what's referred to in
`this process as the '136 patent, which is
`Sauder Manufacturing's patent for what has --
`we market as the Trey chair.
` Q. Are you an inventor on this patent?
` A. I am not.
` Q. And just to be clear, you are not a
`
`Page 16
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` PHILIP E. BONTRAGER
`of those payments?
` A. I have access to precisely how much
`they are. Orders of magnitude, I -- I know
`what they are.
` Q. And what are they?
` A. They represent 4 percent of the net
`sales revenue of the Trey product based on
`shipments.
` Q. And do you know when those payments
`commenced?
` A. When we began shipping the product.
` Q. Which was roughly when?
` A. First shipments I believe occurred
`in January of 2007.
` I believe all of this information is
`already in documents that we have produced as
`part of discovery in the litigation.
` Q. Okay. I'm not on that protective
`order as of right now, so that's why I asked.
` A. Okay.
` Q. In the interest of fairness.
` A. That's a helpful clarification.
` Q. How long did you spend preparing
`your declarations -- or excuse me -- the
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` PHILIP E. BONTRAGER
`patent attorney?
` A. I am not a patent attorney.
` Q. So you did not write this patent.
` A. No.
` Q. Do you know who wrote it?
` A. I do not know who wrote the patent
`itself.
` Q. Did you participate in any of the
`process in drafting this patent or securing its
`issuance from the US Patent Office?
` A. I had no direct participation in it.
` Q. Are you an inventor of any of
`Sauder's patents?
` A. I do not hold any patents.
` Q. So you do not hold any patents from
`Sauder or from anyone else for that matter?
` A. That's correct.
` Q. Yesterday during Mr. Harting's
`deposition, he mentioned payments that flow
`from Sauder to his company, Eleven Point Five.
` A. Yes.
` Q. Are you aware of those payments?
` A. Yes.
` Q. Are you aware of the dollar amounts
`
`Page 17
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` PHILIP E. BONTRAGER
`declaration in front of you? Which when I say
`declarations, we've already established they're
`identical.
` A. I worked on it over a period of
`probably four to six weeks during the time
`immediately preceding the date of my signature
`on the last page.
` Q. Did you author all of the text in
`the declarations?
` A. I did.
` Q. Did you create drafts in the process
`of arriving at a final version?
` A. I began by compiling what I would
`call a stream of consciousness as I was reading
`the patents; the preliminary decision of the
`Patent Board; and then began to update, revise,
`clarify over that time period to arrive at the
`final document that you have in front of you.
` Q. Did you save any of the interim
`versions of this document?
` A. I did not.
` Q. Did you communicate any of those
`versions to anyone?
` A. Only with counsel.
`
`TSG Reporting - Worldwide (877) 702-9580
`
`5
`
`J Squared Exhibit 1028, pg. 5
`J Squared vs. Sauder
`IPR2015-00774
`PARTIES AND BOARD ONLY
`
`

`
`Confidential
`Page 18
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` PHILIP E. BONTRAGER
` Q. No one else?
` A. No.
` Q. Did you discuss the contents of your
`declaration with anyone other than counsel?
` A. No.
` Q. So you did not discuss the contents
`of this with Dave Harting?
` A. No.
` Q. What did you do to prepare for
`today's deposition?
` A. I reviewed a series of documents and
`I met with counsel.
` Q. How long did you meet with counsel?
` A. For several hours during the day on
`Tuesday in the -- during the same session that
`the prior depositions highlighted yesterday.
` Q. And what documents did you review?
` A. I reviewed my declaration, I read
`Tony and Dave's declarations for the first time
`after they had been submitted, I perused the
`'136 patent again, I perused the prior art
`patents that are also the subject of this -- of
`the two petition processes, and then last
`evening I glanced through the file history that
`
`Page 20
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` PHILIP E. BONTRAGER
`advertising, print advertising, in media that
`is unique to the trade of our customers.
` So for the education market, there
`would be some market customer-specific trade
`journals where we would spend modest amounts of
`money, certainly less than six figures on an
`annual basis. Similar kind of thing in
`healthcare, similar kind of thing in the
`worship market.
` Q. Do you have a marketing budget?
` A. Yes.
` Q. And what is that marketing budget?
` A. I would be guessing if I were to
`give the number today.
` Q. I don't need an exact number, but...
` A. Let me ask a clarifying question.
` Q. Uh-huh.
` A. When you refer to marketing, what is
`the nature of the expenses that you would
`capture under that umbrella as you wish to
`interpret it?
` Q. Well, expenses that are related to
`promoting SMC's products to customers.
` A. In total or in the education market?
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` PHILIP E. BONTRAGER
`was referenced during the session yesterday.
` Q. Was that the first time you reviewed
`the file history?
` A. Yes.
` Q. And you said Tony and Dave. Can you
`just state their full names for the record.
` A. Yes. Tony Warncke, or Anthony
`Warncke is how he would have been identified
`yesterday in the deposition, and Dave Harting,
`who is also identified in the first deposition
`taken yesterday.
` Q. Toward the bottom of Page 5 of your
`declaration, you talk about -- well, let me
`just read that sentence:
` "Traditional media advertising (e.g.
`television, ads in printed journals and
`newspapers, etc.) does not play a major role in
`promoting SMC's products to customers."
` Can you clarify what you mean by
`major role?
` A. To my knowledge, we spend no money
`in television, we spend no money in newsp- --
`what would be considered a typical newspaper.
`We will purchase some limited space
`
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` PHILIP E. BONTRAGER
` Q. Well, let's start with in total.
` A. This is a pure guess at this point,
`but it would be less than seven figures.
` Q. And what about the education market?
` A. Low six figures.
` Q. And would that be the same for the
`GSA market?
` A. The GSA market would be dramatically
`less.
` Q. And why is that?
` A. That is not a strategic market
`segment for us. We respond to that reactively
`where there is opportunistic -- opportunities
`for us to sell product.
` We do not as a matter of strategic
`choice develop products uniquely for the GSA
`market; however, for each of our other
`strategic markets, we develop products whose
`characteristics and specifications are
`developed -- conceived, developed and
`manufactured with a close view to the unique
`requirements in each of those market segments.
` Q. So when you say GSA is
`opportunistic, is it fair to say that you're
`
`TSG Reporting - Worldwide (877) 702-9580
`
`6
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`J Squared Exhibit 1028, pg. 6
`J Squared vs. Sauder
`IPR2015-00774
`PARTIES AND BOARD ONLY
`
`

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`Confidential
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` PHILIP E. BONTRAGER
`essentially responding to bid opportunities?
` A. We work to stay informed of bid
`opportunities in that market and respond to
`them as we are able.
` The one departure from that, and
`just as clarification, there is a significant
`portion of the healthcare market that is
`through the GSA contract because those products
`go into veterans administrations and military
`hospitals. And so while the product
`specifications are determined and driven by the
`healthcare environment, the purchasing process
`itself is through the GSA contracting
`mechanism.
` And so in healthcare for VA
`hospitals and for military hospitals, we
`actively promote and pursue those opportunities
`and we develop products that are for the
`healthcare environment.
` For military barracks, or what is
`referred to as the GSA market in this
`declaration, we do not spend meaningful
`resources in the organization to develop nor
`promote to that marketplace.
`
`Page 24
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` PHILIP E. BONTRAGER
` MR. YOUNG: So that -- well, we've
` covered it.
` MR. MCKEOWN: Yeah. Like I said,
` we'll designate the whole thing under seal.
` A. Could you repeat your question,
`please?
` Q. Sure. So I'm just trying to
`understand. The chart shows a down trend in
`plywood chairs, and you state above in the
`paragraph that there were some competitive
`pressures, and I'm just trying to understand
`was it pricing pressure? Was it additional
`competitors? What was the impetus behind
`these --
` A. Okay. There were several things
`that were occurring over this time frame.
` First -- and I reference
`Exhibit 2019, which is cited in Footnote 19 --
`if you review that visual depiction of the
`typical products being sold into this
`marketplace at that time, they essentially all
`look the same.
` Secondly, this -- in the market at
`large in both institutional furniture as well
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` PHILIP E. BONTRAGER
` MR. YOUNG: Can we pause for a
` second? I want to --
` (Off the record at 10:00 a.m.)
` (Back on the record at 10:01 a.m.)
` MR. MCKEOWN: We're designating the
` transcript confidential.
` Q. Okay. Let's go to Page --
` MR. YOUNG: The redactions will be
` modest, however, I believe so far.
` MR. MCKEOWN: Sure.
` Q. Let's go to Page 14. You've got a
`chart there in the middle of the page, and
`you're showing a decline in your bent plywood
`chairs in dorm rooms. And in the text above
`the chart, you state that "SMC was experiencing
`competitive pressure in the market."
` Can you clarify what those pressures
`were?
` MR. YOUNG: Again, this is not an
` objection, but pointing out I've got the
` redacted version in front of me, and that
` has all been redacted from the public
` record, as far as I can see.
` MR. MCKEOWN: Okay.
`
`Page 25
`
` PHILIP E. BONTRAGER
`as in residential furniture, and particularly
`among wooden furniture, including seating, a
`lot of offshoring was occurring.
` So there was a growth in imports, a
`proliferation of sources of supply for
`furniture coming from primarily Asia. That
`exerted a lot of price pressure into the
`marketplace, an increase in competition, and
`that's reflected in the relative unit volume,
`the sales dollars and the profit dollars that I
`show in the graph in the center of Page 14.
` Q. At the bottom of Page 15, you state
`that:
` "As an alternate solution, some
`customers began purchasing traditional office
`desk chairs from office supply stores."
` Were these purchases different than
`those chairs shown in Exhibit 2019?
` A. Yes.
` Q. And what was different about the
`chairs that the students were buying?
` A. They were typically chairs that
`would be very similar in overall construct to
`the one that you are sitting in, a typical
`
`TSG Reporting - Worldwide (877) 702-9580
`
`7
`
`J Squared Exhibit 1028, pg. 7
`J Squared vs. Sauder
`IPR2015-00774
`PARTIES AND BOARD ONLY
`
`

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`Confidential
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` PHILIP E. BONTRAGER
`office chair where you have casters with a
`five-star base; it would be height-adjustable;
`possibly would have a tilt and/or a pivot
`capability, whereas a standard wood frame chair
`does not generally have that.
` Q. Page 16, right around the middle of
`the page there's a sentence that reads:
` "However, physical space remained
`limited and the 'image' of the student
`residence hall environment was a strong
`influence in the student's decision of where to
`attend college."
` Can you explain to me what you mean?
`You sort have got "image" in quotations there.
` A. The intent of that sentence is that
`the ambience, the design, the aesthetic of the
`environment, both of the room and of the public
`spaces in the university residence halls, was a
`factor that colleges recognized was becoming
`more important as parents and students decided
`where the student was going to college.
` In most college environments, both
`public and private, the residence hall is a --
`almost an independent profit center in the
`
`Page 28
`
` PHILIP E. BONTRAGER
`chairs because they did not offer the full
`functionality that an office supply store desk
`chair would offer, the more traditional office
`store, and I mentioned these functions earlier
`here this morning.
` Secondly, someone observed during
`this whole research project, as we looked
`around their own offices, even though we
`manufactured chairs for student dorm rooms,
`none of us were sitting on our own bent plywood
`chairs in our offices. We were sitting on
`chairs like similar to what you're sitting on
`today for the reasons of the functionality.
` Q. On Page 17 you talk about some
`design attributes for a chair for a dorm room.
` Number 3 you state that it's
`important -- well, let me just read what's in
`there: "A design that was contemporary,
`intuitive, and simple to use."
` Would you consider the designs of
`the exhibit -- let me get the right number
`here -- 2019, would you consider those designs
`contemporary as of 2006 when you were
`considering this issue?
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` PHILIP E. BONTRAGER
`university, and they want to put their best
`foot forward in that arena because this is the
`environment in which students are going to be
`living.
` Most of us, when we ourselves go or
`we send our children to school, would prefer to
`send them into a place that is aesthetically
`attractive, it's pleasing, it's got good
`design, it's got good color, it's clean, it's
`in good condition, and so all of that is
`comprehended in my use of the word "image" in
`that sentence.
` Q. And how -- so, again, going back to
`those chairs in 2019, those chairs did not
`convey that image?
` A. From the research that was conducted
`by Eleven and Sauder prior to my serving in my
`current role -- and I'm basing these statements
`on what I have seen presented and read in both
`printed and electronic documents at Sauder, and
`based on my conversations with people in Eleven
`and Sauder, I believe them to be true -- what
`we observed is that frequently our chairs, when
`they were in the room, were not being used as
`
`Page 29
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` PHILIP E. BONTRAGER
` A. I would not consider those designs
`to be contemporary. I would consider them to
`be simple to use.
` Q. Okay. Page 18, you talked -- well,
`you're talking about the efforts of SMC to get
`the Flask chair up and running and
`manufactured. And right towards the bottom of
`that page, there's a paragraph that states:
` "I approved the last significant
`remaining expenditure necessary to
`commercialize the Flask chair: more than
`$600,000 to purchase tooling to manufacture the
`injected-molded plastic chair frame and
`associated components."
` Why was there a decision to move
`away from wood and go to plastic?
` A. To achieve the combination of
`design, functionality, the manufacturing cost
`targets -- strike that. Let me start again.
` To achieve the attributes that were
`outlined for this chair, which are listed on
`Page 17 of this declaration, the combined
`assessment of our own internal engineers and
`the engineering resourc- -- manufacturing
`
`TSG Reporting - Worldwide (877) 702-9580
`
`8
`
`J Squared Exhibit 1028, pg. 8
`J Squared vs. Sauder
`IPR2015-00774
`PARTIES AND BOARD ONLY
`
`

`
`Confidential
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` PHILIP E. BONTRAGER
`resources at Eleven, we determined that
`injection-molded plastic enabled us to achieve
`those characteristics, those attributes, more
`effectively than wood would have enabled us to
`do so.
` Q. Was this the first plastic chair
`that Sauder produced?
` A. It's the first plastic chair that we
`had in our line in the time that I was there.
`I am not aware of any prior to that; however, I
`cannot state that with full certainty.
` Q. Okay.
` A. The company's been in business
`since -- well, for more than 70 years, and so I
`do not have full knowledge of all of the
`products that we would have offered during that
`time frame.
` Q. Would you agree with me that the
`Flask project or the Trey chair as described
`would have been just as successful if it was
`made in wood?
` A. No, I would not agree with that
`statement.
` Q. What about steel? Would it have
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` PHILIP E. BONTRAGER
`rocker chair of -- what eventually became the
`Trey, out of wood. To -- as we were working to
`get the proportions, the dimensions, the
`different physical configurations and design of
`the product, we built one out of wood through a
`combination of milling and hand sanding and
`hand work. And if I were to have the chair
`here today, you could look at that, and it
`would very closely resemble what is identified
`as Item Number 104 on the first page of
`Exhibit 1001.
` However, the consideration between
`wood and plastic was not an aesthetic
`consideration as much as it was a performance
`consideration relative to strength, durability
`and overall manufacturing cost.
` Q. Let's take a look at Page 2