UNITED STATES DISTRICT COURT
`
`SOUTHERN DISTRICT OF INDIANA
`
`Page 1
`
`BONUTTI RESEARCH INC.,
`
`Case No.:
`
`and JOINT ACTIVE SYSTEMS,
`
`I:14-cv-00609-SEB-HJD
`
`INC.,
`
`VS.
`
`Plaintiffs,
`
`LANTZ MEDICAL, INC.,
`
`Defendant.
`
`VIDEOTAPED DEPOSITION OF
`
`TED BROWN
`
`DATE:
`
`Wednesday, April 8, 2015
`
`TIHE:
`
`9:00 a.m.
`
`PLACE:
`
`Carson Boxberger LLP
`
`301 W. Jefferson Boulevard
`
`Suite 200
`
`Fort Wayne, IN 46802
`
`Called as a witness herein in accordance with the
`
`Rules of Civil Procedure before Tracy Larimore,
`
`Registered Professional Reporter and Notary Public.
`
`Bonutti Research, Inc. - Exhibit 2002
`Lantz Medical Inc. v. Bonutti Research Inc. - IPR2015-00993
`Page 1
`
`

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`APPEARANCES:
`
`Robert M. Evans, Jr., Esquire
`Michael J. Hartley, Esquire
`SENNIGER POWERS LLP
`100 North Broadway, 17th Floor
`St. Louis, MO 63102
`314.345.7000
`revans@senniger.com
`mhartley@senniger.com
`On behalf of the Plaintiffs;
`
`J. Blake Hike, Esquire
`Jacque R. Wilson, Esquire
`CARSON BOXBERGER LLP
`301 W. Jefferson Blvd., Suite 200
`Fort Wayne, IN 46802
`260.423.9411
`hike@carsonboxberger.com
`wilson@carsonboxberger.com
`On behalf of the Defendants.
`
`Also present:
`Boris Bonutti
`Terry Van Blaricom, videographer
`
`Page 2
`
`WITNESS INDEX
`PAGE
`DIRECT EXAMINATION
`TED BROWN
`BY MR. EVANS
`
`CROSS EXAMINATION
`TED BROWN
`BY MR. HIKE
`
`167
`
`Confidential portion of transcript
`Attorneys eyes only (removed):
`Page 91, Line 22 through Page 97, Line 9
`(Includes Exhibits 31 and 31)
`Page 102, Line 5 through Page 112, Line 10
`(Includes Exhibits 37-40)
`Page 116, Line 1 through Page 135, Line 21
`(Includes Exhibit 42-44)
`Page 162, Line 15 through Page 164, Line 4
`(Includes Exhibit 52)
`
`Page 3
`
`i
`EXHIBIT INDEX
`2 EXHIBIT
`REFERENCED
`3 Exhibit 7 (Previously marked)
`4 Declaration ................................. 83
`5
`Exhibit 8 (Previously marked)
`6
`LM0022901-22908 ............................. 92
`7
`Exhibit 10 (Previously marked)
`8 Kaiser 0262-0276 ............................ 95
`9
`Exhibit 17 (Previously marked)
`10
`LM0022873-22916 ............................. 95
`11
`Exhibit 24
`12 N-LM000945 .................................. 54
`13
`Exhibit 25
`14
`Check stub copy ............................. 74
`15
`Exhibit 26
`16
`Check stub color copy ...................... 75
`17
`Exhibit 27
`18 N-LM000994 .................................. 82
`19
`Exhibit 28
`2 0
`LM267 ....................................... 83
`21
`Exhibit 29
`22
`LM170-187 ................................... 83
`2 3
`Exhibit 30
`24
`LM0021706-707 ............................... 90
`2 5
`Exhibit 31 (REMOVED - Attorneys Eyes only)
`Page 4
`
`1
`EXHIBIT I N D E X Continued
`2
`REFERENCED
`EXHIBIT
`3
`Exhibit 32 (REMOVED - Attorneys Eyes only)
`4
`Exhibit 33
`5
`LM0007541-7542 .............................. 98
`6
`Exhibit 34
`7 N-LM002263 .................................. 99
`8
`Exhibit 35
`9
`LM00029816-9826 ............................. 100
`10
`Exhibit 36 (REMOVED - Attorneys Eyes only)
`11
`Exhibit 37 (REMOVED - Attorneys Eyes only)
`12
`Exhibit 38 (REMOVED - Attorneys Eyes only)
`13
`Exhibit 39 (REMOVED - Attorneys Eyes only)
`14
`Exhibit 40 (REMOVED - Attorneys Eyes only)
`15
`Exhibit 41
`16
`LM007364 .................................... 112
`17
`Exhibit 42 (REMOVED - Attorneys Eyes only)
`18
`Exhibit 43 (REMOVED - Attorneys Eyes only)
`19
`Exhibit 44 (REMOVED - Attorneys Eyes only)
`2 0
`Exhibit 45
`21
`Stipulated Preliminary Injunction Order ..... 138
`2 2
`Exhibit 46
`23
`LM0021520-21522 ............................. 146
`24
`25
`
`EXHIBIT I N D E X Continued
`Page 5
`
`Pages 2 to 5
`
`Bonutti Research, Inc. - Exhibit 2002
`Lantz Medical Inc. v. Bonutti Research Inc. - IPR2015-00993
`Page 2
`
`

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`REFERENCED
`
`EXHIBIT
`Exhibit 47
`U.S. Patent 5,848,979 ....................... 155
`Exhibit 48
`U.S Patent 7,955,286 ........................ 158
`Exhibit 49
`U.S. Patent 7,112,179 ....................... 159
`Exhibit 50
`U.S. Patent 7,404,804 ....................... 159
`Exhibit 51
`U.S. Patent 8,784,343 ....................... 161
`Exhibit 52 (REMOVED - Attorneys eyes only)
`
`Page 6
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`VIDEOGRAPHER: We are on the record. Th
`time is approximately 9:10 a.m. Today’s date
`
`is April 8th, 2015. My name is Terry
`Van Blaricom, and I am affiliated wifla Summit
`City Reporting in Fort Wayne, Indiana. I will
`be the audio and video operator of the
`deposition of Ted Brown, which is being taken
`on behalf of the plaintiffs.
`Today’s deposition is being taken at
`the law offices of Carson Boxberger, LLP, 301
`
`West Jefferson Boulevard, Suite 200, in Fort
`Wayne, Indiana.
`This case is pending in the United
`
`States DisIacict Court, Southern District of
`
`Indiana, and is Bonutti Research, Inc., and
`Joint Active Systems, Inc., Plaintiffs, versus
`
`Lantz Medical, Inc., Defendant, Cause Number
`1:14 CV00609-SEB-MJD.
`
`The attorneys will now please
`introduce flaemselves and the parties flaey
`represent.
`MR. EVANS: Robert Evans here with
`Senniger Powers for plaintiffs.
`MR. HARTLEY: Michael Hartley, also wifla
`
`Senniger Powers, for plaintiffs.
`
`Page 7
`
`MR. HIKE: Blake Hike from Carson
`Boxberger on behalf of the defendant.
`MR. WILSON: Jacque Wilson from Carson
`
`Boxberger on behalf of the defendant.
`VIDEOGRAPHER: The court reporter, Tracy
`Larimore, will now please swear in l]ae witness.
`
`TED BROWN,
`called as a witness herein, having been first duly
`
`1
`2
`3
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`5
`6
`7
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`sworn, as hereinafter certified, was examined and
`10
`testified as follows:
`11
`DIRECT EXAMINATION OF TED BROWN
`12
`BYMR. EVANS:
`13
`Q What is your full name?
`14 A
`James Theodore Brown.
`15
`Q What is your current address?
`16
`A 42 Carriage Lake Drive, Brownsburg, Indiana,
`17
`46112.
`18
`Mr. Brown, have you ever been deposed before?
`19
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`21
`22
`23
`24
`25
`
`Never.
`All right. So flae way it works -- I know you
`were here yesterday and you saw the process, but
`I’ll just repeat it for your, for your benefit.
`The way it works is I’ll be asking
`you questions. I’d appreciate it if you give
`me full and complete answers, to the extent you
`Page 8
`
`can.
`
`If, at any time, you don’t understand
`a question, it’s vague, it’s unclear to you,
`
`1
`2
`3
`4
`just tell me. I’d be happy to rephrase any
`5
`question that’s -- that you don’t understand.
`6 A Okay.
`7
`Q But if you don’t tell me, I can’t rephrase it,
`8
`so--
`9 A Sure.
`10
`-- feel free to speak up. And this is not an
`Q
`11
`endurance contest, so if at any point you want
`12
`to take a break, just let me know, we’ll take a
`13
`break.
`14
`A Okay.
`15
`I would ask that when a question is pending, we
`16
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`21
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`Q
`
`not take a break then. Finish the answer and
`then we can take a break.
`A Sure.
`Q The tapes last about an hour and 15 minutes, so
`we’re going to be taking breaks at least that
`
`often, so...
`A Okay.
`Q All right. What is your educational background<
`A Graduated from Valencia College in Orlando,
`Florida, with an associate’s degree.
`
`Page 9
`Pages 6 to 9
`
`Bonutti Research, Inc. - Exhibit 2002
`Lantz Medical Inc. v. Bonutti Research Inc. - IPR2015-00993
`Page 3
`
`

`
`1 Q And what was your associate’s degree in?
`Just an associate’s degree.
`Okay.
`And then transferred to the University of
`Central Florida for two semesters, studying
`business. And graduated from Flagler College in
`St. Augustine with a Bachelor of Arts in
`business.
`And what year did you earn that degree?
`
`1988.
`What was your first employment after Flagler
`College?
`It was with a company called Duval Spirits out
`of Jacksonville, Florida. They’re a Gallo wine
`distributing house, so I sold for that company.
`And was that a -- you sold into the retail
`establishments?
`
`Yes. Restaurants, retail.
`And how- long were you employed by Duval Spirit~
`Approximately a year.
`To about 1989?
`Uh-huh. Yeah.
`What was your next employment after that?
`I went out on my own and started a little deal
`with -- called NSA, National Safety Associates.
`Page i0
`
`1
`
`National Safety Associates?
`
`Was with Sutter Corporation in August of 1990.
`And how long were you employed by Sutter
`Corporation?
`Five years.
`
`Until about 1995?
`Uh-huh.
`And what, what kind of a job was that?
`I started out as a patient services
`representative for Sutter Corporation. Sutter
`Corporation was a CPM manufacturer. That’s
`
`i0
`ii
`12
`continuous passive motion. So t~ey were a
`13
`rehab-type compmay, durable medical equipment.
`14 Q
`And when you say, "A patient services rep,"
`15
`what -- how does -- what does t~at do?
`16 A
`Patient services reps, what they do is they fit
`17
`patients on t~e devices.
`i~ Q
`And when you said you had these CPMs, what lira
`19
`was it --
`20 A
`Every limb, practically. Hand, wrist, elbow,
`21
`shoulder, knee, hip, ankle, toe.
`22 Q
`So they had a series of equipment, depending on
`23
`what paxt you hurt or had surgery on --
`24 A
`Correct.
`25 Q
`-- you go fit that piece of equipment to t~at
`Page 12
`
`1
`It was a water filtration s~stem. I was going
`2
`to try my hand at being an entrepreneur and gel
`3
`rich. So what I did for them is, for myself
`4
`actually, is I bought the filtration systems,
`5
`inventoried them, and then pretty much
`6
`telemarketed those products into homes.
`7
`Q And where did you store your inventory?
`8 A
`In the garage.
`9
`Q So you worked out of your house for this one5
`10 A Uh-huh.
`11
`Q And how long did you run that?
`12 A That was for about six or seven months.
`13
`MR. HIKE: And I just want to -- real
`14
`quick, Ted, you said, "Uh-huh," there on one ol
`15
`the answers --
`16
`THE WITNESS: Oh, I’m sorry.
`17
`MR. HIKE: -- if we mean yes, let’s just
`18
`say --
`19
`THE WITNESS: Okay.
`20
`MR. HIKE: -- "Yes." If we mean no, let’s
`21
`say, "No." So when you said, "Uh-huh," what
`22
`did you mean?
`23
`THE WITNESS: Yes.
`24
`MR. HIKE: Okay.
`25
`Q Okay. What was your next employment after
`Page ii
`
`joint or that limb and this thing would just --
`
`That’s correct.
`-- drive it through a range of motion?
`Uh-huh. Yes.
`And, and you held that j ob the entire time you
`were with Sutter?
`No. I actually was promoted to sales associat~
`probably within six months.
`How many employees were in Sutter Corp.?
`I don’t recall. It was a national company.
`Okay. That was my question. So it wasn’t jus
`local to...
`No.
`Okay. You were in a branch office of it, or th(
`home headquarters?
`I was in a branch office --
`Okay.
`-- in Indianapolis.
`Okay. All right. You are promoted sales
`associate within six months?
`Uh-huh.
`And how did your titles ch- -- or are your
`responsibilities changes at that point?
`Just sales became -- started selling the
`equipment, so I’d go to doctors’ offices,
`Page 13
`Pages i0 to 13
`
`Bonutti Research, Inc. - Exhibit 2002
`Lantz Medical Inc. v. Bonutti Research Inc. - IPR2015-00993
`Page 4
`
`

`
`3-
`occupational therapists, physical therapists,
`2
`and sold the product. And I still did a lot of
`3
`the fittings, was still part of the job.
`4
`Q And was that your title when you left, sales
`5
`associate, or did you get any more advances?
`6 A Then I became a senior sales representative in
`7
`the Indianapolis area.
`8
`Q What year was that?
`9 A About six months later.
`3-0
`Q Okay.
`3- 3- A And one more promotion was territory manage~
`3- 2
`which I covered the state of Indiana, Kentucky,
`3- 3
`3_4
`
`and the Cincinnati, Ohio, area. And we did sell
`more than just CPM. I mean, they were a DME
`company, so we sold all kinds of different
`
`3_ 5
`3_ 6
`products.
`3_7
`Q So you started off fitting the CPMs and by the
`3_ 8
`time you were territory manager, you pick up th~
`3_ 9
`whole product line?
`2 0 A No. Just -- no. They was -- even at -- Sutter
`2 3_
`Corporation had a number of products, not just
`2 2
`continuous passive motion.
`2 3
`Q Okay.
`2 4
`A They also had other products available, but
`2 5
`their main focus was continuous passive motion.
`Page 14
`
`What were your responsibilities as senior sales
`rep?
`Almost the same as a sales associate. Sales.
`And then how did t~at change when you became ~
`territory manager?
`Just managing people.
`So you were managing the sales --
`Sales associates and sales people.
`And how many, how many --
`And still, and still selling.
`How many people reported to you when you were
`senior sales rep?
`Probably two.
`And how many reported to you when you were a
`territory manager?
`Between six and eight, I believe.
`
`And those were all sales reps that reported to
`you?
`Everybody would have reported to me as far as
`from patient services reps, sales associates,
`anybody in sales.
`What office were you in as territory manager?
`Indianapolis.
`How many total employees did tAat office have?
`In Indianapolis?
`
`Page 15
`
`1
`Q Yeah.
`2 A Three or four.
`3
`Q Did everybody in the office report to you, I
`4
`guess, is really the --
`5 A Yeah.
`6
`Q Okay. Plus others, it sounds like, if you had
`7
`six to eight reports; right?
`8 A Correct.
`9
`Q And why did you leave that job?
`3_ 0
`A Another opportunity presented itself.
`3_ 3_
`Q And where was that?
`3_2
`A U.S. Orthopedics.
`3_3
`In, what, about 1985? I’m sorry. 1995?
`Q
`3_4
`A Yeah. 1995, I believe.
`3_ 5
`Q What was your title with U.S. Orthopedics?
`3_ 6 A Territory manager, territory sales manager.
`3_7
`Q And what territories did you cover there?
`3_ 8
`A All of Indiana, and I believe that was it.
`3_ 9
`Q And what products did U.S. Orthopedics sell?
`2 0
`A U.S. Orthopedics was a Toronto distributor, so
`2 3_
`they distributed the Toronto Medical continuous
`2 2
`passive motion line. So it’s the same industry,
`2 3
`same business.
`2 4
`Q Same joint, same --
`2 5 A Yes.
`
`Page 16
`
`1
`-- one-for-one match?
`Q
`2
`A Pretty much, yes.
`3
`Q And how many people reported to you there?
`4
`A Three to four.
`5
`Q And how long were you employed at U. S.
`6
`Orthopedics?
`7 A One year.
`8
`Q 1995, or which year was it?
`9 A 1995.
`10
`Q And why did you leave there?
`ii A
`They were a Toronto distributor, so what
`12
`happened there is Toronto came to them and said.
`13
`"You need to give that territory back to a
`14
`company called Surgical and Orthopedic
`15
`Specialties." So that’s my next employment was
`16
`with Surgical and Orthopedic Specialties. They
`17
`were based out of Michigan.
`18 Q
`I don’t understand. Toronto told the office,
`19
`"You have to give the Indianapolis -- or the
`20
`Indiana territory back to Surgical Orthopedic
`21
`Specialties"?
`22 A
`Yeah. So U.S. Orthopedics negotiated a natiom
`23
`contract with Toronto Medical.
`24 Q
`Okay.
`25 A
`Somehow they were able to convince lk~em that
`Page 17
`Pages 14 to 17
`
`Bonutti Research, Inc. - Exhibit 2002
`Lantz Medical Inc. v. Bonutti Research Inc. - IPR2015-00993
`Page 5
`
`

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`Q
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`they should give Indiana to U.S. Ortho, U.S.
`Ortho being the national distributor, but
`Surgical and Orthopedic Specialties was a
`
`Toronto distributor also --
`Uh-huh.
`-- and that -- Indiana was their territory.
`Ah.
`Somehow it was finagled that U.S. Ortho --
`So they had to give it back? They took
`something fl~ey were supposed to -- they took
`something fl~at Toronto wasn’t supposed to give
`away ?
`
`Yeah.
`And how long did you work for Surgical and
`
`Orthopedic Specialties?
`Approximately two years.
`Through about, what, 1997?
`Yeah.
`What was your title with Surgical and Orthopedic
`Specialties?
`Territory manager, sales manager.
`And how many reports did you have there?
`
`Three to four.
`What was your territory?
`Indiana.
`
`Page 18
`
`i A
`And that’s actually -- OrthoLogic bought Sutter
`2
`Corporation at some point in there, so I ended
`3
`up going back to work for lke company I left in
`4
`1995, Sutter Corporation.
`5 Q
`So OrlkoLogic bought Dasminger?
`6 A
`They bought, they bought Danninger, but lacy ha(
`7
`also bought Sutter Corporation during that time.
`8 Q
`Okay. So when you started wilk OrlkoLogic in,
`9
`what, 1998?
`i0 A
`Yea~.
`ii Q
`Was your paycheck issued by OrlkoLogic or was :
`12
`issued by Sutter, Division of OrlkoLogic?
`13
`A
`OrthoLogic.
`14
`Okay. So when you say they bought it, they
`15
`acquired it and integrated them --
`A
`16
`Correct.
`17
`-- into lke corporate slxucture?
`18
`Correct.
`19
`1998, what was your title?
`2 0
`Territory manager.
`21
`What territory?
`2 2
`Indiana.
`2 3
`How many reports?
`2 4
`2 5
`
`Same amount, ~kree, four.
`Okay. And how long were you employed by
`Page 20
`
`Q
`
`And why did you leave Surgical and Orthopedic
`Specialties?
`They were acquired by a company called Danning~
`Medical, so I didn’t really leave them.
`How- do you spell Danninger?
`D-a-n-n-i-n-g-e-r, I believe.
`So you stayed on with Danninger Medical?
`
`Yes.
`And how- long were you --
`That was probably about a year.
`Okay. And you remained the territory manager?
`Uh-huh.
`Same number of reports? Three or four?
`
`Yes.
`And what kind of equipment were you working wil
`for them?
`Same type of equipment. If you look at it,
`actually, I worked with about every CPM
`manufacturer known to man by the time this is
`going to be done.
`All right. And what was your next employment
`after Danninger?
`Danninger was purchased by a company called
`OrthoLogie.
`Okay.
`
`Page 19
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`OrthoLogic?
`A I really don’t remember, to be honest with you.
`I resigned relatively quickly after that. I
`really -- I mean, maybe two or three months.
`Q And why did you resign so quickly?
`A Burnt out maybe, and not wanting really to go
`back to work for the company I had left because
`the same management was there.
`Q When you say "the same management," who wa:
`that?
`A I don’t remember their names now, honestly.
`
`Vince Estrada is one.
`Q Vince Estrada?
`A Uh-huh.
`Q Anybody else you can remember?
`A
`(Shakes head.)
`Q All right. So after you left two or three
`months into OrthoLogic, what was your next
`employment?
`’98, so I took some time oft’. My daughter was
`born that year, so I spent some time with her.
`And then in 1999, at some point, I started U.S.
`
`A
`
`Medical Products, Inc.
`
`Q 1999?
`A Uh-huh.
`
`Page 21
`
`Pages 18 to 21
`
`Bonutti Research, Inc. - Exhibit 2002
`Lantz Medical Inc. v. Bonutti Research Inc. - IPR2015-00993
`Page 6
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`

`
`What -- before we, before we move on to this
`next phase -- let’s, let’s move on from that.
`Okay. So how long were you with U.S. Medical
`Products, Inc.? Or I guess you started it;
`right?
`
`Yeah, I started it.
`So how long did that company run?
`
`I did that for about a year or two. And --
`about a year or two. And in -- for sure a year,
`
`and then I continued to dabble in stuff with
`U.S. Medical, but I was also working with a
`company called Wabash Medical out of
`Indianapolis.
`And how big of a company is Wabash Medical?
`At that time, maybe a million-dollar company.
`Million dollars in sales a yeax?
`
`Uh-huh.
`How many employees did Wabash have?
`I mean, I really can’t recall exactly, but I
`would say when I started there, they probably
`
`had six.
`And how long were you working with Wabash
`Medical?
`I worked with Wabash Medical from about 2000
`2004.
`
`Page 22
`
`i
`actually came by again with a new product that
`2
`he was developing, which was a hand/wrist
`3
`continuous passive motion device.
`4 Q
`What year was that?
`5 A
`That was in the time frame of 2000, 2001, I
`6
`believe. And this is -- so where U.S. Medical
`7
`sort of gets back involved again. So I went and
`8
`spoke with John Moorin, and that could have been
`9
`2001, 2002, somewhere in there. I’m just not
`i0
`good with dates, but anyway he brought the,
`ii
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`o 24
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`brought the CAD/CAM drawings of the products i:
`and I looked at it, and I immediately knew that
`if he could actually come out with this hand
`CPM, that it would probably revolutionize the
`marketplace because there was not a good hand
`CPM available on the market. And I was an
`expert on CPMs, as far as I was concerned, at
`
`that time after working with about every CPM
`manufacturer.
`So I knew it was going to be a good
`product. So I went to John Moorin, who was the
`president of Wabash Medical, and I said, "Hey,
`John, I think we should get involved with this
`project."
`And John did not want to get involved
`Page 24
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`full time.
`Q Full time. Okay. And when you went to full
`time with Wabash, is that when U.S. Medical
`faded out, or did you keep doing U.S. Medical on
`
`1
`Q What was your title with Wabash Medical?
`2 A Sales in the beginning, and then office manager.
`3
`Q And so was that what I call a permanent job? I
`4
`mean, you went to -- was a 9-to-5 job?
`5 A Probably not right off the bat. 2001 to 2004
`6
`would have probably been considered more of a
`7
`8
`9
`10
`11
`the side?
`12 A
`I always had U.S. Medical Products as a companI
`13
`that was established. U.S. medical was just --
`14
`what I did with U.S. Medical was portable
`15
`hyperbaric oxygen chambers. So I did that for
`16
`about a year.
`17
`Q And then after that, what did you do with U. S.
`18
`Medical?
`19 A When I was with Wabash in 2000, 2001, Bob
`2 0
`Kaiser, I think he sent a fax on his knee CPM
`21
`equipment and we responded to his fax. And he
`2 2
`2 3
`2 4
`2 5
`
`came in and met for the first time, I think. I
`met Bob and he just went over his knee CPM
`products with Wabash. We bought some of those
`
`knee CPMs, rented some knee CPMs. And then h
`Page 23
`
`1
`with the project, so I said, "John, if you’re
`2
`not going to get involved with the project, do
`3
`you mind ifI do?" and he said, "Nope. Go
`4
`ahead and do it."
`5
`So that’s when U.S. Medical got
`6
`involved with Bob Kaiser.
`7
`Q Somewhere in the 2000, 2001, 2002 range?
`8 A Yeah.
`9
`Q Okay. And how did -- and when you say "got
`10
`involved," did Kaiser have his hand CPM workin
`11
`at that point or was it just drawings?
`12 A
`Just drawings.
`13
`Q Okay. When did he finally turn it into a
`14
`product?
`15 A You know, I would -- I have to -- in order to
`16
`recall all of that, I would have to research it.
`17
`I can’t give you dates.
`18
`Q At some point in the process, did he have a han(
`19
`CPM to sell?
`2 0 A He did.
`21
`Q And U.S. Medical bought it?
`2 2 A Yes.
`2 3
`Q And then, what, you turned around and rented it?
`2 4 A Uh-huh. So started a company called Applied
`2 5
`Motion Technology to distribute that. So the
`Page 25
`Pages 22 to 25
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`Bonutti Research, Inc. - Exhibit 2002
`Lantz Medical Inc. v. Bonutti Research Inc. - IPR2015-00993
`Page 7
`
`

`
`Q
`
`1
`And tk~at’s the piece of equipment with
`2
`electrodes and kind of a battery pack --
`3 A
`Correct.
`4 Q
`-- or some kind of an electrical circuit?
`5 A
`Yes.
`Q
`When did Applied Motion pick up the electrical
`7
`muscle stimulation equipment?
`8 A
`I don’t recall.
`9 Q
`Was it right at the beginning or something that
`io
`came later?
`ii A
`I can’t recall. It’s going -- could have been
`12
`in the beginning, could have been in tk~e middle.
`13
`I’m just not sure.
`14
`Q
`When you say the "middle," what -- how long di(
`15
`Applied Motion --
`16
`Applied Motion, I believe, was in existence
`17
`18
`19
`o
`21
`22
`23
`24
`25
`
`until 2008.
`So you said in the beginning or tk~e middle,
`we’re talking 2004, maybe 2006?
`Correct.
`The custom ACL OA bracing -- did you say OA
`bracing?
`Yeah. Osteoarthritis bracing.
`When did Applied Motion pick up that kind of
`
`work?
`
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`timeline would be -- so in 2004, Applied Motion
`Technology was created to market tAe hand CPM
`tAe state of Indiana. So it took from our first
`meeting until approximately tAat time for tAat
`
`hand CPM to come about.
`Q
`Come to fruition?
`Uh-huh.
`Okay. So you set up a different company,
`Applied Motion, to do the hand CPM instead of
`
`U.S. Medical?
`A
`Correct.
`Why was that?
`
`I brought on a business partner, Perry Mervar.
`How do you spell the last name?
`M-e-r-v-a-r.
`Okay.
`So I wanted to start a new, start a new company.
`
`We became 50/50 partners in that company.
`Q
`So you and Perry Mervar start Applied Motion in
`approximately ’04 --
`A Uh-huh.
`-- to sell the Kaiser hand CPM?
`Q
`A Correct. The DigiGlide.
`Q DigiGlide. Okay.
`A And TenoGlide.
`
`Page 26
`
`Q Okay. Did Applied Motion have any other
`products?
`A Yes. Dynamic and static splinting, electxical
`muscle stim, TENS units. We did custom ACL
`bracing, custom OA bracing.
`Anything else?
`
`Q
`
`Maybe some cold tk~erapy units.
`Anything else?
`Not that I can think of right now.
`All right. So let’s back up a little bit. So
`Applied Motion started with a Kaiser hand CPM ~
`about 2004?
`Correct.
`When did -- you said "electrical muscle stim"?
`
`A
`
`Uh-huh.
`What is that?
`I’m not the expert of tk~at. That’s Penny
`Mervar’s side of the business.
`
`Q
`
`And so --
`So electrical muscle stim. For instance, if you
`
`had quad shutdown after an ACL surgery, you
`could place electrodes on the muscle and get
`that muscle to fire again witk~ electrical muscle
`stim. So it would fire tk~e muscle. So it would
`reeducate the muscle.
`
`Page 27
`
`Page 28
`
`A
`I’m guessing ifI tell you. I’m guessing on the
`dates that I’m giving you on the other stuff. I
`don’t remember exactly when. We may have picke
`
`1
`2
`3
`4
`it up immediately. I can’t remember.
`5 Q Okay. And you also said dynamic and static
`splint?
`Uh-huh.
`When did it pick up that --
`That probably happened --
`-- product?
`-- immediately.
`
`io
`ii
`12
`Why are you so sure that one was immediately?
`13
`Well, because Perry came from a company called
`14
`Empi, E-m-p-i, and he sold a number of dynamic
`15
`splints.
`16
`Q And so you continued selling Empi splints then
`17
`at Applied Motion?
`18
`A I don’t know if it was Empi splints or DeRoyal
`19
`splints. Probably, probably more DeRoyal, but
`2 0
`I’m sure we sold Empi splints, too.
`21
`Q And then cold therapy, when did you pick that
`22
`up?
`23 A I don’t know.
`2 4
`Q So when you started in 2004 with Applied Motior
`
`2 5
`you had Bob Kaiser’s DigiGlide and TenoGlide
`Page 29
`Pages 26 to 29
`
`Bonutti Research, Inc. - Exhibit 2002
`Lantz Medical Inc. v. Bonutti Research Inc. - IPR2015-00993
`Page 8
`
`

`
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`hand CPMs and you had a DeRoyal or an Empi
`splint?
`A Uh-huh.
`Q And then you later picked up these other things
`at some period of time?
`
`A Correct.
`Q Other than you and Perry Mervar, did U.S. -- I’rr
`sorry -- did Applied Motion have any other
`employees or owners?
`A They did not -- we did not have any other
`owners. There were employees for Applied
`
`Motion.
`How many?
`It all runs together.
`I mean five, ten, three, a couple? Just a
`ballpark.
`
`Two, three.
`Okay. In 2008, when Apply- -- Applied Motion
`stopped functioning, I guess, why did you stop?
`Why did you shut it down or what happened?
`Well, it merged with Lantz Medical. Lantz
`
`Medical was incorporated in August of 2005. I
`just want to make sure I go on the record that
`those are approximate dates.
`Right. And that’s all they are.
`
`Page 30
`
`Q
`
`A
`
`A
`
`Q
`
`A
`
`A
`
`Okay.
`That’s what you said. So let me -- so let’s
`start a new page. So you said approximately
`2005, Lantz was formed?
`Uh-huh.
`Who were the initial owners of Lantz?
`The initial owners would have been myself and
`Jim Robertson. Well, let me think about this
`for a minute. So Lantz Medical. 2005. It
`would -- I don’t know the time frame, but it
`would -- I started the company, so... and then I
`brought in an investor, Jim Robertson. And then
`when we merged -- well, then I brought in
`another gentleman, Jerry McKevitt.
`Q How do you spell the last name?
`A M-c, capital K-e-v-i-t-t. So I believe he came
`in in December.
`
`Q Of’05?
`A
`Is that, what -- we have ’05 there. It would
`have probably been ’06.
`
`Q ’06?
`A Yeah. So he was an owner. And then when wc
`merged Applied Motion and Lantz Medical
`together, Harry Mervar became an owner. And
`think it happened in that order. I can’t be
`Page 31
`
`1
`2
`
`sure.
`Q And what products did Lantz have initially in
`
`13
`
`3
`2005?
`4 A Lantz had the Vectorl hand CPM and the Vector~
`5
`Q Did Lantz ever pick up the TenoGlide or the
`6
`DigiGlide?
`7 A The DigiGlide and the TenoGlide were perfected
`8
`into the Vectorl and the Vector2.
`9
`Q Okay. What territory did Lantz have for the
`10
`Vectorl and Vector2?
`11 A It was a national type deal.
`12
`Q National territory?
`A Uh-huh.
`]VIR. HIKE: Is that a "yes," Ted?
`14
`15 A Yes.
`16
`Q So was Lantz in competition then with Applied
`17
`Motion? Overlapping territories?
`18 A
`No, because Applied Motion continued to run the
`19
`2O
`21
`
`2 2
`
`2 3
`Q
`2
`4 A
`
`2 5
`Q
`
`Q
`A
`
`Indiana area. Lantz Medical ran the national,
`outside the Indiana.
`So it did everything but Indiana? Lantz?
`Correct.
`And that was acceptable to Perry Mervar?
`Uh-huh. Yes. Sorry.
`So in 2005, Lantz was set up to sell the Vectorl
`Page 32
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`and Vector2 hand CPMs?
`A Yes.
`Q Any other products at that time?
`A Not at that time.
`Q What other products do you have today?
`A We have the Stat-A-Dyne line. We carry custon
`ACL and OA bracing, other types of continuous
`passive motion equipment for the elbow,
`shoulder, knee, and some back bracing products.
`Q Back bracing?
`A Uh-huh.
`Q Anything else?
`A Probably. I’m just not thinking of all of them.
`Q Those are the major ones?
`A
`I believe, yes.
`Q Are you an owner or participant in any other
`companies, other than Lantz, today?
`A No.
`Q You don’t have any budding companies that are
`going to merge into Lantz one day --
`A No.
`
`-- at this time?
`Q
`A No.
`Q Have you been involved in any other companies
`other than the ones you’ve already testified to?
`Page 33
`Pages 30 to 33
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`Bonutti Research, Inc. - Exhibit 2002
`Lantz Medical Inc. v. Bonutti Research Inc. - IPR2015-00993
`Page 9
`
`

`
`Not that I recall.
`Okay. Is Wabash Medical still in existence
`today?
`Not under flaat name, no. They were purchased.
`Okay. What name do they operate under today?
`It’s changed like four times. I’m not sure. I
`think it’s Tri3 Enterprises.
`
`Tri3?
`Uh-huh. That tells you how good my memory is
`because they’re right next door.
`
`Oh, yeah? When you say "right next door," wha!
`do you mean?
`They’re right next door to my -- to Lantz
`Medical.
`Really?
`
`Yeah.
`And does -- do they, do they still sell or work
`in the hand CPM business?
`They’re, they’re not in the hand CPM business.
`
`Never have been.
`So what business is Wabash in?
`Continuous -- they did continuous passive motiol
`
`of the knee, shoulder, elbow.
`But never the hand?
`No. Well, not that I’m aware of. They may have
`Page 34
`
`done a few, but that was not their core
`business.
`So do you compete against them for the knee,
`
`shoulder, and elbow CPM business?
`Very little.
`Why is that?
`Because we don’t do very many elbow, knee, and
`shoulder CPMs.
`Ah. They’re more of a dominant player there?
`They’re a dominant player, and they’re just not
`
`as lucrative as our hand CPM business.
`Do any of the people you worked with at Wabast
`
`back in 2001 -- or 2000 to 2004 still work there
`today?
`
`Yes. David Slack.
`And what is David’s title or what does he do?
`I would say he’s a territory sales manager.
`Operations type guy.
`But you have no business relationship with them
`today; is that right?
`They might do some billing for us on occasion,
`so the owner of that company is Mike Willford.
`
`Mike Willford?
`Uh-huh.
`You said they might do some billing for you.
`Page 35
`
`out of network and that obviously penalizes the
`patient.
`Q So in those states, the patient deals with an
`entity called Wabash or Tri3 County, whatever it
`
`I don’t recall how much that is.
`Is it five-percent? Ten percent? Can’t be too
`
`Q
`
`1
`Why is that?
`2 A There are certain states where we don’t have
`3
`cont