`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`____________
`
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`____________
`
`
`APPLE INC.,
`Petitioner
`
`v.
`
`CHESTNUT HILL SOUND INC.,
`Patent Owner
`
`____________
`
`
`Case IPR2016-00794
`Patent 8,090,309
`
`___________
`
`
`
`PETITIONER’S MOTION TO EXCLUDE
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`
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`Case IPR2016-00794
`Attorney Docket No: 39521-0016IP2
`TABLE OF CONTENTS
`
`I.
`INTRODUCTION ............................................................................................. 1
`II. ARGUMENT ..................................................................................................... 1
`A.
`Exhibit 2004 is inadmissible hearsay and lacks authentication ................ 1
`1. The cited statements within Exhibit 2004 are inadmissible hearsay.......... 2
`2. Patent Owner has failed to authenticate Exhibit 2004 ............................... 4
`Exhibit 2008 is inadmissible hearsay ........................................................... 5
`B.
`Exhibit 2009 is inadmissible hearsay ........................................................... 7
`C.
`Exhibit 2014 is inadmissible hearsay ........................................................... 9
`D.
`Exhibits 2015 and 2016 are inadmissible hearsay .................................... 11
`E.
`III. CONCLUSION ................................................................................................ 15
`
`
`
`i
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`Case IPR2016-00794
`Attorney Docket No: 39521-0016IP2
`
`I.
`
`INTRODUCTION
`With its Preliminary Patent Owner Response (“PPOR”) and its Patent
`
`Owner Response (“POR”), Patent Owner submitted several exhibits that are
`
`inadmissible for the basis relied on by Patent Owner, under the Federal Rules of
`
`Evidence (“FRE”). As described below, several of Patent Owner’s exhibits violate
`
`the FRE’s prohibition on hearsay (see FRE 802) and fail to meet the basic
`
`requirements of authenticity (see FRE 901). For at least the reasons discussed
`
`below, the Board should exclude the Patent Owner’s Exhibits 2004, 2008, 2009,
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`2014, 2015, and 2016 from the present IPR as inadmissible under the FRE.
`
`II. ARGUMENT
`A. Exhibit 2004 is inadmissible hearsay and lacks authentication
`The Board should exclude Exhibit 2004 as inadmissible because the
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`statements cited by Patent Owner therein are hearsay to which no valid exception
`
`applies, and because Patent Owner has failed to provide any evidence
`
`authenticating the document.1
`
`
`1 Petitioner previously objected to Exhibit 2004 on these grounds in its
`
`Objection to Evidence filed October 7, 2016. See Paper 7, pp. 1-2. Patent Owner
`
`was timely served with these objections and did not respond.
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`1
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`Case IPR2016-00794
`Attorney Docket No: 39521-0016IP2
`The cited statements within Exhibit 2004 are inadmissible
`hearsay
`Patent Owner describes Exhibit 2004 as three documents filed with a brief in
`
`1.
`
`support of a preliminary injunction motion in a district court case between Patent
`
`Owner and Petitioner. See PPOR, p. 10. Documents within Exhibit 2004 appear
`
`to be the same two press releases submitted as Exhibits 2015 and 2016 (discussed
`
`below at Section II.E), so the same arguments against admissibility discussed with
`
`respect to those Exhibits also apply here. Exhibit 2004 also includes what looks to
`
`be a presentation prepared by an entity called “Multinational Sound, Inc.” See Ex.
`
`2004, pp. 2, 5, 21. All three documents appear to be related to Patent Owner’s
`
`George™ product. In its PPOR, Patent Owner cites Exhibit 2004 as evidence that
`
`the George™ product won various awards after being launched in 2007. See
`
`PPOR, p. 10 (citing Ex. 2004). For example, the PPOR cites Exhibit 2004 as
`
`support for its claim that the George™ product “won a Best of Show award at the
`
`Macworld tradeshow, a ‘Play of the Year’ award from Macworld Magazine, and
`
`PC Magazine’s Editor’s Choice Award, all shortly after its launch in 2007.”
`
`PPOR, p. 10 (citing, generally, Ex. 2004). Patent Owner thus offers the statements
`
`in Exhibit 2004 for their truth to support its contention that the George™ won
`
`awards. See id. Further, none of the statements in Exhibit 2004 were made while
`
`testifying in the current proceeding, and are thus out of court statements. See id.
`
`Accordingly, the statements regarding the awards won by the George™ product
`
`
`
`2
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`Case IPR2016-00794
`Attorney Docket No: 39521-0016IP2
`from Exhibit 2004 are out of court statements offered for their truth, and are thus
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`hearsay. See FRE 801.
`
`Further, none of these statements fall under any proper hearsay exception,
`
`and Patent Owner has made no argument that any exception applies that would
`
`render the statements admissible. See FRE 803. To the extent Patent Owner
`
`argues that the two press releases within the Exhibit are business records, these
`
`press releases are identical to Exhibits 2015 and 2016, and thus the same
`
`arguments presented above with respect to those exhibits applies. See Section I.E,
`
`supra. With respect to the marketing presentation included in Exhibit 2004, as
`
`previously discussed the presentation appears to have been prepared by an entity
`
`called “Multinational Sound, Inc.” See Ex. 2004, p. 21. Patent Owner thus cannot
`
`credibly argue that the business record exception applies to this document, because
`
`it is apparent on its face that it was prepared by “Multinational Sound, Inc.,” and
`
`not by employees or representatives of Chestnut Hill with knowledge of the act,
`
`event, condition, opinion, or diagnosis, recorded as required by the business record
`
`exception. See id.
`
`In addition, Patent Owner has not shown that the residual exception under
`
`FRE 807 applies. Indeed, Patent Owner cannot credibly argue that the statements
`
`in Exhibit 2004 have equivalent circumstantial guarantees of trustworthiness as
`
`that of testimony from these same declarants if Petitioners had an opportunity for
`
`
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`3
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`Case IPR2016-00794
`Attorney Docket No: 39521-0016IP2
`vigorous cross examination. Patent Owner has not shown that this is an
`
`“exceptional case” under FRE 807. See, e.g., Conoco Inc. v. Dep’t of Energy, 99
`
`F.3d 387, 392 (Fed. Cir. 1996) (“The two residual hearsay exceptions . . . were
`
`meant to be reserved for exceptional cases.”). Thus, the residual exception of FRE
`
`807 does not apply.
`
`Accordingly, for at least the reasons discussed above, the Board should
`
`exclude the statements within Exhibit 2004 as inadmissible hearsay.
`
`2.
`Patent Owner has failed to authenticate Exhibit 2004
`The Board should also exclude Exhibit 2004 for lack of authentication
`
`because Patent Owner has offered no evidence that the exhibit is what it purports
`
`to be. FRE 901. Patent Owner’s only characterization of the Exhibit occurs in its
`
`lone citation to it in the PPOR: “Chestnut Hill Sound Inc. v. Apple Inc., No. 15-
`
`261-RGA (D. Del) (Exs.1, 2 and 4 to D.I. 9, Opening Brief in Support of Motion
`
`for Preliminary Injunction).” See PPOR, p. 10. Patent Owner provides no
`
`evidence that this is an authentic copy of this district court filing. Further, Patent
`
`Owner has not shown that the Exhibit falls under any of the categories of “self-
`
`authenticating” evidence. See FRE 902. Absent such a showing, Exhibit 2004 is
`
`inadmissible under FRE 901 and should be excluded.
`
`
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`4
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`Case IPR2016-00794
`Attorney Docket No: 39521-0016IP2
`B. Exhibit 2008 is inadmissible hearsay
`The Board should exclude Exhibit 2008 as inadmissible because the
`
`statements cited in the Exhibit by Patent Owner for the truth of the matter asserted
`
`therein are hearsay to which no valid exception applies.2
`
`In his declaration, Robert Friedman describes Exhibit 2008 as a “copy of an
`
`article titled ‘Review: Chestnut Hill Sound George’” downloaded from the
`
`Internet. Friedman Declaration, ¶ 2. In its POR, Patent Owner cites and quotes
`
`statements from the Exhibit as evidence of industry reaction to the George™
`
`product. See POR, p. 27 (citing, generally, Ex. 2008). The cited statements in
`
`Exhibit 2008 are hearsay as none were made while testifying for the current
`
`proceeding and all are being offered for the truth of the matters asserted therein.
`
`FRE 801. The POR describes Exhibit 2008 as declaring George “an impressive
`
`piece of technology” and “praising features of the ʼ309 patent, such as the two-
`
`
`2 Petitioner previously objected to Exhibits 2008, 2009, 2014, 2015, and
`
`2016 on the grounds discussed herein in its Objection to Evidence filed December
`
`1, 2016. See Paper 15. Petitioner renewed these objections in response to Patent
`
`Owner’s delayed filing of its Patent Owner Response on December 8, 2016. See
`
`Paper 19. Patent Owner was timely served with these objections and did not
`
`respond.
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`5
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`Case IPR2016-00794
`Attorney Docket No: 39521-0016IP2
`mode system accessed with the remote control as a media device, as part of the
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`value of the George system in which they were embodied.” POR, p. 27 (citing Ex.
`
`2008, generally). It also states that “[t]he elements of the ʼ309 that were
`
`represented in the George system gave that system ‘a unique and compelling
`
`combination of features’ that was critically praised.” The POR thus cites Exhibit
`
`2008 as factual evidence of a positive industry reaction to the George™ product,
`
`but provides only this article and no declaration, deposition or other sworn
`
`testimony from the reviewer into the record. See id. The out of court statements in
`
`Exhibit 2008 are offered to show the reviewer’s opinion of the George™ product,
`
`and are offered for their truth. All statements in the Exhibit, to the extent relied on
`
`for the truth of the matter therein, are hearsay.
`
`Further, none of these statements fall under any proper hearsay exception,
`
`and Patent Owner has made no argument that any exception applies that would
`
`render the statements admissible. See FRE 803. It also has not shown that the
`
`residual exception under FRE 807 applies. Indeed, Patent Owner cannot credibly
`
`argue that the statements in Exhibit 2004 have equivalent circumstantial guarantees
`
`of trustworthiness as that of testimony from these same declarants if Petitioners
`
`had an opportunity for vigorous cross examination. Patent Owner has not shown
`
`that this is an “exceptional case” under FRE 807. See, e.g., Conoco Inc. v. Dep’t of
`
`Energy, 99 F.3d 387, 392 (Fed. Cir. 1996) (“The two residual hearsay
`
`
`
`6
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`Case IPR2016-00794
`Attorney Docket No: 39521-0016IP2
`exceptions . . . were meant to be reserved for exceptional cases.”). Thus, the
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`residual exception of FRE 807 does not apply.
`
` In addition, the testimony of Robert Friedman related to Exhibit 2008 does
`
`not provide any evidence that would render these statements admissible. See Paper
`
`17, ¶ 2. Mr. Friedman states that he is “familiar with [the] article” provided as
`
`Exhibit 2008 “because it is a review which was published about a product sold by
`
`Chestnut Hill Sound Inc.” Id. He also testifies as to the Internet address of the
`
`article and the date it was downloaded. Id. At most, this testimony is relevant to
`
`the authenticity of the Exhibit, and does not contradict Petitioner’s argument that
`
`the statements from Exhibit 2008 are inadmissible hearsay.
`
`Accordingly, for at least reasons above, the Board should exclude the
`
`statements from Exhibit 2008 cited and quoted in the POR as inadmissible hearsay.
`
`C. Exhibit 2009 is inadmissible hearsay
`The Board should exclude Exhibit 2009 as inadmissible because the
`
`statements cited in the Exhibit by Patent Owner for the truth of the matter asserted
`
`therein are hearsay to which no valid exception applies.
`
`In his declaration, Robert Friedman describes Exhibit 2009 as a “copy of an
`
`article titled ‘Chestnut Hill Sound George’” downloaded from the Internet.
`
`Friedman Declaration, ¶ 3. In its POR, Patent Owner cites and quotes statements
`
`from Exhibit 2009 as evidence of industry reaction of the George™ product. See
`
`
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`7
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`Case IPR2016-00794
`Attorney Docket No: 39521-0016IP2
`POR, p. 27 (citing, general, Ex. 2009). The cited statements in Exhibit 2009 are
`
`hearsay as none were made while testifying for the current proceeding and all are
`
`being offered for the truth of the matters asserted therein. FRE 801. The POR
`
`states that “PCMag gave the George system four and a half stars” and “PCMag
`
`noted that the George system, which embodied inventions of the ʼ309 patent, was
`
`‘super capable’ and cited as one of its ‘Pros’ the ‘[d]etachable remote that controls
`
`a wide variety of functions.’ Id. at 28 (citing Ex. 2009). The POR further states
`
`that the Exhibit called “the embodiment of the media device ‘advanced’…touted
`
`the ease of use of the system, and called it ‘the new king of the iPod dock
`
`mountain.’” Id. The POR thus cites Exhibit 2009 as factual evidence of a
`
`purported positive industry reaction to the George™ product, but only provides the
`
`article and no declaration, deposition or other sworn testimony from the reviewer
`
`into the record. See id. The out of court statements in Exhibit 2009 are offered to
`
`show the reviewer’s opinion of the George™ product, and are thus offered for their
`
`truth. All statements in the Exhibit, to the extent relied on for the truth of the
`
`matter therein, are hearsay.
`
`Further, none of these statements fall under any proper hearsay exception,
`
`and Patent Owner has made no argument that any exception applies that would
`
`render the statements admissible. See FRE 803. It also has not shown that the
`
`residual exception under FRE 807 applies. Indeed, Patent Owner cannot credibly
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`8
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`Case IPR2016-00794
`Attorney Docket No: 39521-0016IP2
`argue that the statements in Exhibit 2009 have equivalent circumstantial guarantees
`
`of trustworthiness as that of testimony from these same declarants if Petitioners
`
`had an opportunity for vigorous cross examination. Patent Owner has not shown
`
`that this is an “exceptional case” under FRE 807. See, e.g., Conoco, 99 F.3d at
`
`392. Thus, the residual exception of FRE 807 does not apply.
`
`In addition, the testimony of Robert Friedman related to Exhibit 2009 does
`
`not provide any evidence that would render these statements admissible. See Paper
`
`17, ¶ 3. Mr. Friedman states that he is “familiar with [the] article” provided as
`
`Exhibit 2009 “because it is a review which was published about a product sold by
`
`Chestnut Hill Sound Inc.” Id. He also testifies as to the Internet address of the
`
`article and the date it was downloaded. Id. At most, this testimony is relevant to
`
`the authenticity of the Exhibit, and does not contradict Petitioner’s argument that
`
`the statements from Exhibit 2009 are inadmissible hearsay.
`
`Accordingly, for at least these reasons, the Board should exclude the
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`statements from Exhibit 2009 cited and quoted in the POR as inadmissible hearsay.
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`D. Exhibit 2014 is inadmissible hearsay
`The Board should exclude Exhibit 2014 as inadmissible because the
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`statements cited in the Exhibit by Patent Owner for the truth of the matter asserted
`
`therein are hearsay to which no valid exception applies.
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`
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`9
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`Case IPR2016-00794
`Attorney Docket No: 39521-0016IP2
`Patent Owner’s only characterization of Exhibit 2014 occurs in its citation of
`
`it in the POR. See POR, p. 28 (citing “Pl. First Amnd. Complaint”). On its face,
`
`the Exhibit appears to Chestnut Hill Sound’s “First Amended Complaint” from its
`
`infringement action against Petitioner in the District of Delaware. See Ex. 2014, p.
`
`1. In its POR, Patent Owner cites to Patent Owner’s own characterization of facts
`
`in Exhibit 2014 as evidence of communications between itself and Petitioner. See,
`
`e.g., POR, p. 25 (“Patent Owner informed Petitioner of the novel bidirectional
`
`remote control system, related to the challenged claims, which could control
`
`Petitioner’s iPod. Ex. 2014 at ¶ 11.”; “It was also filed after Patent Owner
`
`approached Petitioner and demonstrated the George system to representatives of
`
`the Petitioner in August of 2005. Ex. 2014, P1[sic]”). The POR also cites Patent
`
`Owner’s own characterization of facts in Exhibit 2014 as evidence of statements
`
`allegedly made by and knowledge allegedly possessed by Petitioner. See, e.g., id.
`
`(“Petitioner remarked, through its representatives, that it was ‘impressed with
`
`[Patent Owner] Chestnut Hill Sound’s technology plans[.]’” (quoting Ex. 2014, ¶
`
`15); “Petitioner was also aware that the George system, embodying in part the
`
`challenged claims, was sold at approximately 80 stores owned and operated by the
`
`Petitioner[.]” (quoting Ex. 2014, ¶¶ 20-21)). These statements are out of court
`
`statements, not made in connection with the current proceeding, offered for the
`
`truth of the various matters asserted. Patent Owner provides only the document of
`
`
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`10
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`Case IPR2016-00794
`Attorney Docket No: 39521-0016IP2
`Exhibit 2014, and no declaration, deposition or other sworn testimony of the
`
`purported signatories to the document or persons with personal knowledge of the
`
`facts. Thus, reliance on Exhibit 2014 for the truth of the matters asserted therein is
`
`hearsay.
`
`Patent Owner also has not shown that the residual exception under FRE 807
`
`applies. Indeed, Patent Owner cannot credibly argue that the statements in Exhibit
`
`2014 have equivalent circumstantial guarantees of trustworthiness as that of
`
`testimony from these same declarants if Petitioners had an opportunity for vigorous
`
`cross examination. Patent Owner has not shown that this is an “exceptional case”
`
`under FRE 807. See, e.g., Conoco, 99 F.3d at 392. Thus, the residual exception of
`
`FRE 807 does not apply.
`
`E. Exhibits 2015 and 2016 are inadmissible hearsay
`The Board should exclude Exhibits 2015 and 2016 as inadmissible because
`
`the statements cited in the Exhibit by Patent Owner for the truth of the matter
`
`asserted therein are hearsay to which no valid exception applies.
`
`In his declaration, Robert Friedman describes Exhibits 2015 and 2016 as
`
`“Press Releases titled ‘Chestnut Hill Sound Wins Best of Show at MacWorld
`
`George Digital Audio System for the iPod Debuts, dated January 12, 2007 and
`
`‘George Receives Editor’s Choice Awards from PC Magazine, Laptop and
`
`Mac|Life,’ dated April 27, 2007.” Friedman Declaration, ¶ 4. In its POR, Patent
`
`
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`11
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`Case IPR2016-00794
`Attorney Docket No: 39521-0016IP2
`Owner cites to Exhibits 2015 and 2016 as evidence of “commercial success and
`
`praise by others” of the George™ product. See, e.g., POR, p. 25-27 (citing,
`
`generally, Ex. 2016 & 2016). The POR cites Exhibit 2015 to support its statement
`
`that the George™ product “won a Best of Show Award from the editors of
`
`Macworld during the 2007 Macworld Expo and Conference,” and “won Editor’s
`
`Choice Awards from PC Magazine, LapTop, and Mac | Life.” POR, p. 26 (citing
`
`Ex. 2015 & 2016). The POR thus cites Exhibits 2015 and 2016 as factual
`
`evidence of a positive industry reaction to the George product, but only provides
`
`the articles and no declaration, deposition or other sworn testimony from the
`
`reviewers into the record. The out of court statements are offered to show the
`
`reviewer’s opinion of the George™ product, and are thus offered for their truth.
`
`All statements in the Exhibit, to the extent relied on for the truth of the matter
`
`therein, are hearsay.
`
`Patent Owner appears to assert that Exhibits 2015 and 2016 are admissible
`
`as business records under FRE 803(6). Even assuming that Patent Owner is
`
`correct, the business records exception renders only portions of the Exhibits
`
`prepared by Chestnut Hill in the regular course of business admissible. In his
`
`declaration, Mr. Friedman states that these “Press Releases are kept by Chestnut
`
`Hill Sound Inc. in the regular course of business,” and refers to the Exhibits as
`
`“records of the Press Releases.” Id. (emphasis added). Thus, Patent Owner did not
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`12
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`Case IPR2016-00794
`Attorney Docket No: 39521-0016IP2
`claim to author these press releases as a record of an event, but merely saved
`
`documents authored by a third party. See id. Accordingly, the statements within
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`Exhibits 2015 and 2016 are not statements by an employee or representative of
`
`Chestnut Hill “with knowledge of the act, event, condition, opinion, or diagnosis,
`
`recorded,” but are instead statements by the author of each press release. These
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`statements, which as discussed above are out of court statements, relied on by the
`
`POR for their truth, are hearsay within hearsay, and thus must independently fall
`
`under an exception to the rule against hearsay to be admissible. See FRE 805.
`
`Patent Owner has not shown that the statements within the press releases were
`
`made by an “employee or representative with knowledge of the act, event,
`
`condition, opinion, or diagnosis, recorded,” and thus has not shown that the
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`business record exception, or any other exception to the rule against hearsay,
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`applies these statements. Because the statements are hearsay to which no
`
`exception applies, the statements within Exhibit 2015 and 2016 are inadmissible
`
`and should be excluded. See FRE 801, 803.
`
`Further, the authors of Exhibits 2015 and 2016 have included quotes from
`
`individuals in the body of the documents. Even if Patent Owner were to show that
`
`an exception to the rule against hearsay applies to the other statements within the
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`Exhibits, the quotes within the Exhibits are statements by individuals other than the
`
`authors of the documents. These quotes are thus hearsay within hearsay within
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`13
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`Attorney Docket No: 39521-0016IP2
`hearsay, and, like the statements by the authors, must independently fall under an
`
`exception to the rule against hearsay to be admissible. See FRE 805. Patent
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`Owner has not shown that these quotes fall under any exception. Accordingly,
`
`even if Patent Owner shows that the author’s statements within the press releases
`
`are admissible, the quotes within the press releases remain inadmissible hearsay.
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`Further, the Exhibits include quotations from Steve Krampf, who is
`
`identified therein as the “CEO of Chestnut Hill Sound.” See Ex. 2016, p. 1; Ex.
`
`2015, p. 1. If Patent Owner wishes to introduce testimony from Mr. Krampf or
`
`other employees of Chestnut Hill Sound, it should have these witnesses submit a
`
`sworn declaration and make them available for cross-examination by Petitioner.
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`The Board should not allow Patent Owner to skirt the rules by introducing Mr.
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`Krampf’s self-serving testimony within these Exhibits. The Board should also not
`
`consider this testimony to be reliable, as Mr. Krampf is not subject to the penalty
`
`of perjury or to cross-examination by Petitioner.
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`In addition, Patent Owner has not shown that the residual exception under
`
`FRE 807 applies. Indeed, Patent Owner cannot credibly argue that the statements
`
`in Exhibits 2015 and 2016 have equivalent circumstantial guarantees of
`
`trustworthiness as that of testimony from these same declarants if Petitioners had
`
`an opportunity for vigorous cross examination. Patent Owner has not shown that
`
`
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`14
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`Case IPR2016-00794
`Attorney Docket No: 39521-0016IP2
`this is an “exceptional case” under FRE 807. See, e.g., Conoco, 99 F.3d at 392.
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`Thus, the residual exception of FRE 807 does not apply.
`
`Accordingly, for at least the reasons discussed above, the Board should
`
`exclude the statements within Exhibit 2004 as inadmissible hearsay.
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`III. CONCLUSION
`For at least the reasons set forth above, Exhibits 2004, 2008, 2009, 2014,
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`2015, and 2016 should be excluded from the present proceeding as inadmissible
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`Respectfully submitted,
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`
`
`/Joshua A. Griswold/
`
`Joshua A. Griswold, Reg. No. 46,310
`W. Karl Renner, Reg. No. 41,265
`Daniel D. Smith, Reg. No. 71,278
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`Attorneys for Petitioner
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`under the FRE.
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`Dated: March 16, 2017
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`15
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`Case IPR2016-00794
`Attorney Docket No: 39521-0016IP2
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`
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`CERTIFICATE OF SERVICE
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`Pursuant to 37 CFR §§ 42.6(e)(1) and 42.6(e)(4)(iii), the undersigned
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`certifies that on March 16, 2017, a complete and entire copy of this Petitioner’s
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`Motion to Exclude was provided via email to the Patent Owner by serving the
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`email correspondence addresses of record as follows:
`
`Hamad M. Hamad
`Alexis (Steinberg) Mosser
`CALDWELL CASSADY CURRY, P.C.
`2101 Cedar Springs Road, Suite 1000
`Dallas, Texas 75201
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`Email: hhamad@caldwellcc.com
` acurry@caldwellcc.com
` amosser@caldwellcc.com
` chillsound@caldwellcc.com
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`/Diana Bradley/
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`Diana Bradley
`Fish & Richardson P.C.
`60 South Sixth Street, Suite 3200
`Minneapolis, MN 55402
`(858) 678-5667
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