EXHIBIT D
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`Patent Owner’s Response and Notice of Supplemental
`Evidence in Response to Petitioner’s Objections to Patent
`Owner’s Evidence Dated October 30, 2019
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`Sleep Number Corp.
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`Patent Owner’s Response and Notice of Supplemental
`Evidence in Response to Petitioner’s Objections to Patent
`Owner’s Evidence Dated October 30, 2019
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`Sleep Number Corp.
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`UNITED STATES PATENT AND TRADEMARK OFFICE
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`____________
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`____________
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`AMERICAN NATIONAL MANUFACTURING INC.,
`Petitioner,
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`v.
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`SELECT COMFORT CORPORATION,
`Patent Owner.
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`____________
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`Case No. IPR2019-00500
`Patent No. 9,737,154 B2
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`SUPPLEMENTAL DECLARATION OF CARL G. DEGEN
`IN SUPPORT OF PATENT OWNER’S RESPONSE
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`Sleep Number Corp.
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`I, Carl G. Degen, declare as follows:
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`1.
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`I am over the age of 21 years and am fully competent to make this
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`Supplemental Declaration. I make the following statements based on personal
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`knowledge and, if called to testify to them, could and would do so.
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`2.
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`I received my Bachelor’s of Science Degree in Mathematics and
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`Economics from the University of Wisconsin–Parkside in Kenosha, Wisconsin in
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`1977. I then completed all but my dissertation toward a Ph.D. in Economics at the
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`University of Wisconsin–Madison in 1980.
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`3.
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`I am currently employed at Laurits R. Christensen Associates, Inc. in
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`Madison, Wisconsin, where I have worked since 1980. I started my employment as
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`an Economist in 1980, and advanced numerous times to my current role as President,
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`which I have held since 2005. I was previously an Economics Teaching Assistant
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`from 1977 to 1978 and an Economics Research Assistant from 1978 to 1980 at the
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`University of Wisconsin–Madison. I was also the Vice President of the Wisconsin
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`Business Economics Association from 1983 to 1984.
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`4.
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`I have testified in numerous litigations involving intellectual property
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`and other business disputes, and in postal and energy rate cases. Since joining Laurits
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`R. Christensen Associates, Inc., I have worked extensively on projects for the U.S.
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`Postal Service including productivity measurement, cost measurement, product cost
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`models, and regulatory reform. I have also worked on projects in the energy and
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`railroad industries. I have authored papers and written regulatory testimony.
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`5.
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`6.
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`A copy of my current CV is attached as Appendix A.
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`I have been retained by Fox Rothschild LLP, counsel for Sleep Number
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`Corporation, formerly known as Select Comfort Corporation (“Sleep Number”), to
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`analyze certain unit sales data produced in this inter partes review (“IPR”)
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`proceeding by Petitioner American National Manufacturing, Inc. (“ANM”). None
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`of my opinions are contingent on any result or payment of my fees.
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`Understanding of the Law
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`7.
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`I am not a lawyer and do not offer legal opinions. However, I do have
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`an understanding of certain legal concepts as relevant to my work and my analysis
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`in this case.
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`8.
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`I understand that there are various secondary indicia of non-
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`obviousness (sometimes called “secondary considerations”) that a patent owner may
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`argue support a finding of patentability. I understand one such secondary
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`consideration is commercial success, which I understand to relate to economic
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`considerations regarding the products at issue. I understand one relevant
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`consideration of commercial success is demand for the patented technologies, which
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`can relate to the amount of sales of products that include the patented technologies,
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`the sales trends of these products, and the market’s purchasing behavior regarding
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`these products. I understand another relevant consideration of commercial success
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`is adoption of the patented technologies, which I understand to relate to the extent
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`to which patented technologies displace non-patented technologies in relevant
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`segments of the market.
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`9. My opinions and analyses are based on the data and evidence currently
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`available. If additional evidence or clarifying information is provided, I reserve the
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`right to consider its impact, if any, on my opinions and analyses and amend this
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`declaration if appropriate.
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`Background
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`10.
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`I have reviewed Sleep Number’s Amended Disclosure of Asserted
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`Claims and Infringement Contentions against ANM, which is Exhibit 2044, as well
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`as the redacted Exhibits 2046, 2047, 2048, and 2049 (collectively, “Sleep Number’s
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`Infringement Contentions”). I understand that these exhibits disclose ANM’s air bed
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`systems, including names of air controllers with particular manifolds and source
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`code, that Sleep Number has accused in an underlying district court case.
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`11.
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`It is my understanding that ANM petitioned the United States Patent
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`and Trademark Office for IPR on three Sleep Number Patents: U.S. Patent No.
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`5,904,172 (“the ‘172 Patent”); U.S. Patent No. 9,737,154 (“the ‘154 Patent”); and
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`U.S. Patent No. 8,769,747 (“the ‘747 Patent”); and that IPR has been instituted on
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`each Patent. I understand that infringement is not an issue in this IPR, but I use the
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`term “accused” throughout this declaration for ease of reference and because that is
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`the term ANM used in its production of its unit sales data discussed below (which is
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`reflected in Exhibit 2057 explained below).
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`12.
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`I have reviewed a document produced by ANM in the underlying
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`district court case with the bates number ANMI00133414–22, which I understand is
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`Exhibit 2052. I understand based upon my review of Exhibit 2052 that it includes
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`the names of air controllers ANM sold between the years 1998 and 2018 and that it
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`includes a timeline at ANMI00133414 depicting when ANM sold each air controller.
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`For reasons described below, my analysis focuses on what ANM refers to as the Gen
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`2 V4, Gen 3 V1, and Gen 3 V2 air controllers and focuses on the time period August
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`2012 onward. Based upon my review, I understand that the timeline and the
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`subsequent pages provide information regarding the “Manifold” and “Software”
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`(ANM’s terms used in Exhibit 2052) included in these air controllers. This is
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`relevant to my analysis as explained below.
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`13. Exhibit 2052 (at ANMI00133414 and ANMI00133420) shows that
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`ANM sold the Gen 2 V4 air controller (which included an “Arco/Rimco” manifold
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`and “Arco, Target system”1 Software) from August 2012 through approximately
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`December 2014. Exhibit 2052 (at ANMI00133414 and ANMI00133421) shows that
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`ANM sold the Gen 3 V1 air controller (which included an “Arco/Rimco” manifold,
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`and “Providence, Target system” Main version 1.5 – 1.82 and Remote version 1.8
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`Software (identified collectively as “M1.5-1.8/R1.8” in Exhibit 2057)), from June
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`25, 2014
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`through August 2016. Exhibit 2052 (at ANMI00133414 and
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`ANMI00133422) shows that ANM sold the Gen 3 V2 air controller (which included
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`1 Exhibit 2052 at ANMI00133420 indicates that ANM’s Gen 2 V4 air controller is
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`the earliest air controller that ANM described as a “target pressure” controller with
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`“Target system” software.
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`2 I see that Exhibit 2052 at ANMI00133414 refers only to a version 1.8 but that
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`Exhibit 2052 at ANMI00133421 refers to a version 1.5 – 1.8. I understand from
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`Sleep Number’s counsel, Exhibits 2048 and 2049 (included in Sleep Number’s
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`Infringement Contentions), and Exhibit 2029 (Declaration of George Edwards) that
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`Sleep Number has inspected and accused version 1.8.
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`a “Koge” manifold3 and “Providence, Target system” Main versions 1.92, 1.97,4 2.0
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`and Remote version 2.55 Software (identified collectively as “M1.92-2.0/R2.55” in
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`Exhibit 2057)), from August 2016 onward.
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`14.
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`I understand from Exhibits 2044 and 2046 (included in Sleep Number’s
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`Infringement Contentions), Exhibit 2027 (Declaration of Dr. John Abraham),
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`Exhibit 2029 (Declaration of George Edwards), and Exhibit 2057 (IPR 8) that Sleep
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`Number has asserted that air beds sold since at least August 2012 with ANM’s air
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`controllers that include at least an Arco or Koge “manifold” (which I understand
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`3 Based on conversation with Sleep Number’s counsel, Exhibit 2027 (Declaration of
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`Dr. John Abraham), and the bullet-point description in Exhibit 2052 at
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`ANMI00133422, I understand that the Gen 3 V2 air controller included a Koge
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`manifold, not an Arco/Rimco manifold as is indicated elsewhere on ANMI00133422
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`(presumably inadvertently).
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`4 Exhibit 2052 at ANMI00133414 does not include reference to a version 1.97, but
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`my analyses would be the same had it been incorporated at any period of time when
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`ANMI00133414 notes version 2.0 was incorporated because I understand from
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`Exhibits 2048 and 2049 (included in Sleep Number’s Infringement Contentions) and
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`Exhibit 2029 (Declaration of George Edwards) that Sleep Number asserts both as
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`reading on its ‘154 Patent and ‘747 Patent.
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`from Exhibit 2027 Sleep Number refers to as the enclosure of the valve enclosure
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`assembly) supported by the corresponding source code versions noted in Exhibit
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`2052 read on its ‘172 Patent.5 I also understand from Exhibits 2044, 2048, and 2049
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`(included in Sleep Number’s Infringement Contentions), Exhibit 2029 (Declaration
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`of George Edwards), Exhibit 2027 (Declaration of Dr. John Abraham), and Exhibit
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`2057 (IPR 8) that Sleep Number has asserted that air beds sold with ANM’s air
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`controllers that include at least Software (i.e. source code) versions 1.8, 1.97, and
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`2.0 read on its ‘154 Patent and ‘747 Patent.6
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`5 I understand from Exhibits 2044 and 2047 that Sleep Number also accuses medical
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`beds such as the Platinum 5000/6000. I understand from Exhibit 2057, addressed in
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`more detail below, that ANM sold medical beds such as the “Platinum 6000
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`Controller” with a “Medisphere” manifold. I understand from Sleep Number’s
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`counsel that Sleep Number has accused these beds. Therefore, I include ANM’s units
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`with the Medisphere manifold in the noted portion of my analyses below. I call these
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`units “Medisphere units.”
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`6 I understand from Exhibits 2044 and 2047 that Sleep Number also accuses medical
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`beds such as the Platinum 5000/6000. I understand from Exhibit 2057, addressed in
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`more detail below, that the medical beds ANM sold with a Medisphere manifold
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`included either Medisphere source code or Sizewise source code (the latter of which
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`15. As already noted, I have also reviewed the Declarations of John
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`Abraham and George Edwards, which are Exhibits 2027 and 2029, which I also
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`relied upon in gleaning the foregoing information.
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`Unit Data Analyses
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`16.
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`I understand from Sleep Number’s counsel and from reviewing ANM’s
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`discovery responses dated October 14, 2019, that, on October 15, 2019, ANM
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`produced a revised native excel document titled “IPR 8_Monthly Data For Accused
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`and NonAccused – HIGHLY CONFIDENTIAL AEO” in this IPR, that, based on
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`my review, I understand purports to provide unit sales data for ANM’s sales of
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`consumer and medical beds for the time period March 2004 to September 2019. I
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`received these data from Sleep Number’s counsel on October 15, 2019 and I
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`reviewed the Board’s order dated October 7, 2019 requiring the production of these
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`data. These data include only units for ANM’s identified sales. These data do not
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`include revenues, prices, expenses, or profits regarding ANM’s identified sales,
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`which, if made available to me in Excel format, may provide further evidence of the
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`I understand from Sleep Number’s counsel has also been referred to as Platinum
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`source code). By virtue of my inclusion of ANM’s units with the Medisphere
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`manifold in the noted portion of my analyses below, these versions of source code
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`are also included.
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`commercial success of ANM’s products achieved as a result of incorporating the
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`technologies from Sleep Number’s ‘172 Patent, ‘154 Patent, and ‘747 Patent. Such
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`evidence may include price premiums, increased revenues, reduced expenses,
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`increased profits, and/or profit premiums on ANM’s products achieved as a result of
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`incorporating the technologies from Sleep Number’s ‘172 Patent, ‘154 Patent, and
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`‘747 Patent. Again, I do not have those data, so I cannot say one way or another
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`whether they would provide evidence of commercial success, but I note that they
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`may. I have reviewed Exhibit 2057, so I understand that it consists of a portion of
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`“IPR 8.” Specifically, I understand that Exhibit 2057 consists of a PDF of the tab in
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`IPR 8 titled “Raw Data,” which is the tab containing the data that I analyzed, sorted
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`by Month lowest to highest (Column B). I routinely consider sales data of market
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`participants to determine, among other things, commercial success, and industry
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`adoption. The information contained in Exhibit 2057 and IPR 8 are of the type that
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`economists like me reasonably rely upon in formulating an opinion on secondary
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`considerations or other valuations matters. In analyzing this information, I followed
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`methods that are accepted in the study of economics. Specifically, I utilized the raw
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`data provided and organized those data based on different products to analyze
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`changes in sales over time and during certain time periods. I regularly testify as to
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`the results of such analyses because they are a reliable method of examining data.
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`My testimony herein is based on sufficient facts and data, is the product of reliable
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`principles and methods, and I have applied the principles and methods reliably to the
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`facts provided in this case to reach my opinion.
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`17.
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`I analyzed ANM’s “Raw Data” in Exhibit 2057 by filtering various
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`columns of information and running various pivot tables. Specifically, my analyses
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`consider the “Month” of each sale in Column B, the “Inner Co” sales (i.e. inter-
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`company sales) and “3rd Party” sales (i.e. sales to third parties) in Column D, the
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`“Description” of the product being sold in Column F, the number of “Units Sold”
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`for each such product in Column H, whether the product was a “Medical” or
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`“Consumer” product in Column I, whether the product sold included a “Manifold”
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`listed in Column K that has been accused by Sleep Number, and/or whether the
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`product sold included “Software” (i.e. source code) listed in Column L that has been
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`accused by Sleep Number. Column K includes the following five options for
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`“Manifold” – Arco, Koge, Medisphere, N/A, 7 and Sun/Wok. I understand from
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`Exhibits 2044 and 2046 (included in Sleep Number’s Infringement Contentions),
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`Exhibit 2027 (Declaration of Dr. John Abraham), and Exhibit 2029 (Declaration of
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`George Edwards), and the “Accused” Columns J and M of Exhibit 2057 that Sleep
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`Number has asserted that at least ANM’s air controllers with the Arco, Koge, and
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`7 I understand from Sleep Number’s counsel, based on counsel’s discussion with
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`ANM’s counsel, that “N/A” refers to a product not sold with an accused “Manifold.”
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`Medisphere manifolds (supported by the corresponding source code versions noted
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`in Exhibit 2052) read on Sleep Number’s ‘172 Patent. I base my analyses below on
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`ANM’s unit data from Exhibit 2057 that include these manifolds. For now, I do not
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`include the N/A or Sun/Wok manifolds in my analyses. Column L includes eight
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`options for “Software” – Arco, Arco Target, M1.5-1/8.R1.8, M1.92-2.0/R2.55,
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`Medisphere, N/A,8 Sizewise, and Sun/Wok. I understand from Exhibits 2044, 2048,
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`and 2049 (included in Sleep Number’s Infringement Contentions), Exhibit 2029
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`(Declaration of George Edwards), Exhibit 2027 (Declaration of Dr. John Abraham),
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`and the “Accused” Columns J and M of Exhibit 2057 that Sleep Number has asserted
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`that at least ANM’s air controllers with source code versions 1.8, 1.97, and 2.0
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`(supported by the corresponding manifolds noted in Exhibit 2052) read on its ‘154
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`Patent and ‘747 Patent. I base my analyses below on ANM’s unit data from Exhibit
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`2057 that include these versions of source code. For now, I do not consider the Arco,
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`Arco Target, N/A, or Sun/Wok versions of source code.
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`18. My analyses address two questions: 1) Did ANM’s use/changes
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`regarding technologies that Sleep Number asserts read on Sleep Number’s ‘172
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`Patent, ‘154 Patent, and ‘747 Patent impact ANM’s average monthly unit sales of
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`8 I understand from Sleep Number’s counsel, based on counsel’s discussion with
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`ANM’s counsel, that “N/A” refers to a product not sold with an accused “Software.”
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`accused pumps/air controllers as seen as in Exhibit 2057; and 2) What was ANM’s
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`adoption rate of the manifolds/source code that Sleep Number asserts read on Sleep
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`Number’s ‘172 Patent, ‘154 Patent, and ‘747 Patent compared to the sales of
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`mattresses identified by ANM as accused in Column M of its “Raw Data” (Exhibit
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`2057).
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`Impact from ANM’s Changes in Manifold and/or Software
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`19. Because Exhibit 2052 (at ANMI00133420) shows that ANM’s first
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`offering of a “target pressure” air controller was in August 2012, I begin my analyses
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`of ANM’s unit sales data from Exhibit 2057 in August 2012 and conduct the
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`analyses over four periods of time: (1) August 2012 through June 2014 (“Period 1”),
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`(2) July 2014 through July 2016 (“Period 2”), (3) August 2016 through August 2017
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`(“Period 3”), and (4) September 2017 through September 2019 (“Period 4”).9 Period
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`1 reflects the time frame that ANM sold the Gen 2 V4 air controller with an
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`9 Additionally, I start my analysis in 2012 because I understand from Exhibit 2033
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`(Declaration of Elizabeth Patton) and Exhibit 2037 referenced within (Agreement
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`and Amendment) that, prior to 2012, ANM’s unit sales to consumers would have
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`been subject to a non-compete agreement between parties in this IPR. Therefore, I
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`do not include this time period in my analyses, which is largely focused on consumer
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`sales but partially includes medical sales of Medisphere units as addressed below.
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`Arco/Rimco manifold (see Exhibit 2052 at ANMI00133414, ANMI00133420),
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`which I understand from Exhibits 2044 and 2046 (included in Sleep Number’s
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`Infringement Contentions), Exhibit 2027 (Declaration of Dr. John Abraham),
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`Exhibit 2029 (Declaration of George Edwards), and the “Accused” Columns J and
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`M of Exhibit 2057 is asserted by Sleep Number to read on Sleep Number’s ‘172
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`Patent. Period 2 reflects the time frame that ANM sold the Gen 3 V1 air controller
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`with an Arco/Rimco manifold
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`(see Exhibit 2052 at ANMI00133414,
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`ANMI00133421), which I understand from Exhibits 2044 and 2046 (included in
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`Sleep Number’s Infringement Contentions), Exhibit 2027 (Declaration of Dr. John
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`Abraham), Exhibit 2029 (Declaration of George Edwards), and the “Accused”
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`Columns J and M of Exhibit 2057 is asserted by Sleep Number to read on Sleep
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`Number’s ‘172 Patent; and included source code version M1.5-1.8/R1.8 which I
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`understand from Exhibits 2044, 2048, and 2049 (included in Sleep Number’s
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`Infringement Contentions), Exhibit 2029 (Declaration of George Edwards), and the
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`“Accused” Columns J and M of Exhibit 2057 is asserted by Sleep Number to read
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`on Sleep Number’s ‘154 Patent and ‘747 Patent. Period 3 reflects the time frame that
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`ANM sold the Gen 3 V2 air controller with a Koge manifold (see Exhibit 2052 at
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`ANMI00133414, ANMI00133422), which I understand from Exhibits 2044 and
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`2046 (included in Sleep Number’s Infringement Contentions), Exhibit 2027
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`(Declaration of Dr. John Abraham), Exhibit 2029 (Declaration of George Edwards),
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`and the “Accused” Columns J and M of Exhibit 2057 is asserted by Sleep Number
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`to read on Sleep Number’s ‘172 Patent; and included source code versions 1.9 and
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`1.92 which I understand from Exhibits 2044, 2048, and 2049 (included in Sleep
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`Number’s Infringement Contentions) and Exhibit 2029 (Declaration of George
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`Edwards) is not asserted by Sleep Number to read on Sleep Number’s ‘154 Patent
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`or ‘747 Patent. Period 4 reflects the time frame that ANM sold the Gen 3 V2 air
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`controller with a Koge manifold (see Exhibit 2052 at ANMI00133414,
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`ANMI00133422), which I understand from Exhibits 2044 and 2046 (included in
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`Sleep Number’s Infringement Contentions), Exhibit 2027 (Declaration of Dr. John
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`Abraham), Exhibit 2029 (Declaration of George Edwards), and the “Accused”
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`Columns J and M of Exhibit 2057 is asserted by Sleep Number to read on Sleep
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`Number’s ‘172 Patent; and included source code version 2.0 which I understand
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`from Exhibits 2044, 2048, and 2049 (included in Sleep Number’s Infringement
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`Contentions), Exhibit 2029 (Declaration of George Edwards), and the “Accused”
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`Columns J and M of Exhibit 2057 is asserted by Sleep Number to read on Sleep
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`Number’s ‘154 Patent and ‘747 Patent.10
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`20. My analyses identify unit sales of ANM’s accused pumps/air
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`controllers as products containing variants of “pump” or “controller” in the
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`“Description” in Column F of Exhibit 2057 and have a “Manifold” asserted to read
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`on Sleep Number’s ‘172 Patent in Column K and/or have a “Software” (i.e. source
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`code version) asserted to read on Sleep Number’s ‘154 Patent or ‘747 Patent in
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`Column L of Exhibit 2057 as discussed above in paragraphs 14 and 17 and their
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`footnotes. Specifically, when analyzing data in the “Description” column (which I
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`also reference below), I used the pivot table feature of Excel to isolate rows hitting
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`on those terms. Attached as Appendix B is a chart created from these data showing
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`ANM’s monthly unit sales of pumps/air controllers that include a manifold and/or
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`source code that I understand is asserted to read on Sleep Number’s ‘172 Patent,
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`‘154 Patent, and/or ‘747 Patent (“accused pumps/air controllers”) as discussed above
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`in paragraphs 14 and 17 and their footnotes. The three vertical lines indicate the
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`10 To the extent that ANM’s source code version 1.97 was implemented during a
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`portion of Period 4, I understand from Exhibit 2029 (Declaration of George
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`Edwards) that Sleep Number has asserted this source code version also reads on
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`Sleep Number’s ‘154 Patent and ‘747 Patent and thus my analysis remains the same.
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`transitions between the Periods described above in paragraph 19. The four horizontal
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`lines indicate ANM’s average monthly unit sales during each Period described above
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`in paragraph 19. ANM’s average monthly unit sales of accused pumps/air controllers
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`as defined above (calculated based on “Month” (Column B); and using “Units Sold”
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`(Column H) from ANM’s data in Exhibit 2057) by Period as defined in paragraph
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`19 above are shown in Table 1 below:
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`More specifically, I determined based on adding up the number of accused pumps/air
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`controllers as defined above for each Period as defined above that:
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`. If only
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`consumer demand is considered—and ANM’s Medisphere units are excluded—the
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`results of these analyses are consistent. Appendix B_1 is my Appendix B chart
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`excluding Medisphere units. Table 1A shows ANM’s sales of accused pumps/air
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`controllers excluding Medisphere units:
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`16
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`Sleep Number Corp.
`SUPPLEMENTAL EXHIBIT 2030
`IPR2019-00500
`Page 18
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`I determined based on adding up the number of accused pumps/air controllers
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`(excluding Medisphere units) as defined above for each Period as defined above that:
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` This provided sufficient information to compare the data.
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`21. Applying this information in a reliable way using the widely recognized
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`and accepted Wald Test, which is a test that allows the comparison of the means
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`between two datasets, I statistically tested ANM’s mean unit sales of accused
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`pumps/air controllers for each Period to the mean of ANM’s unit sales of accused
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`pumps/air controllers in an adjacent Period to determine if ANM’s average monthly
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`unit sales of accused pumps/air controllers was statistically different between the
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`compared Periods. Appendix C shows the results of my statistical analyses generated
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`by this testing in the form of the log file exported by the STATA software, a
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`commonly accepted software for statistical analyses, which I used to perform these
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`analyses. Appendix C_1 shows the results of my statistical analyses generated by
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`17
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`Sleep Number Corp.
`SUPPLEMENTAL EXHIBIT 2030
`IPR2019-00500
`Page 19
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`this testing after excluding Medisphere units in the form of a log file exported by the
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`STATA software used to perform these analyses.
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`22.
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`I understand from Exhibit 2052; Exhibits 2044, 2048, and 2049
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`(included in Sleep Number’s Infringement Contentions); and Exhibit 2029
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`(Declaration of George Edwards) that ANM’s product changes between Period 1
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`and Period 2 include a change from ANM’s Arco Target source code not asserted to
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`read on Sleep Number’s ‘154 Patent and ‘747 Patent to ANM’s version 1.8 source
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`code asserted to read on Sleep Number’s ‘154 Patent and ‘747 Patent.
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`11 As shown in Appendix C,
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`Sleep Number Corp.
`SUPPLEMENTAL EXHIBIT 2030
`IPR2019-00500
`Page 20
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`23.
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`I understand from Exhibit 2052; Exhibits 2044, 2048, and 2049
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`(included in Sleep Number’s Infringement Contentions); and Exhibit 2029
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`(Declaration of George Edwards) that ANM’s product changes between Period 2
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`and Period 3 include a change from source code asserted to read on Sleep Number’s
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`‘154 Patent and ‘747 Patent (version 1.8) to source code not asserted to read on Sleep
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`Number’s ‘154 Patent or ‘747 Patent (versions 1.9 and 1.92). I understand from
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`Exhibit 2052; Exhibits 2044 and 2046 (included in Sleep Number’s Infringement
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`Contentions); and Exhibit 2027 (Declaration of Dr. John Abraham) that ANM’s
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`12 As shown in Appendix C_1,
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`19
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`Sleep Number Corp.
`SUPPLEMENTAL EXHIBIT 2030
`IPR2019-00500
`Page 21
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`accused pumps/air controllers also changed at this time from an Arco/Rimco
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`manifold to a Koge manifold—both of which are asserted to read on Sleep Number’s
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`‘172 Patent.
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`Sleep Number Corp.
`SUPPLEMENTAL EXHIBIT 2030
`IPR2019-00500
`Page 22
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`24.
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`I understand from Exhibit 2052; Exhibits 2044, 2048, and 2049
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`(included in Sleep Number’s Infringement Contentions); and Exhibit 2029
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`(Declaration of George Edwards) that ANM’s product changes between Period 3
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`and Period 4 include a change from source code not asserted to read on Sleep
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`Number’s ‘154 Patent and ‘747 Patent (versions 1.9 and 1.92) to source code
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`asserted to read on Sleep Number’s ‘154 Patent and ‘747 Patent (version 2.0 and
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`version 1.97 to the extent it was implemented).
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`13 As shown in Appendix C,
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`Sleep Number Corp.
`SUPPLEMENTAL EXHIBIT 2030
`IPR2019-00500
`Page 23
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`25.
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` I understand from my experience that the demand
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`14 As shown in Appendix C_1,
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`22
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`Sleep Number Corp.
`SUPPLEMENTAL EXHIBIT 2030
`IPR2019-00500
`Page 24
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`, is a relevant factor
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`to consider regarding commercial success of ANM’s accused pumps/air controllers.
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`ANM’s Adoption of Accused Manifolds and Source Code
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`26.
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`I also understand from my experience that evidence of adoption—
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`specifically here, ANM’s adoption of the technologies asserted to read on Sleep
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`Number’s ‘172 Patent, ‘154 Patent, and ‘747 Patent in its pumps/air controllers—is
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`another relevant consideration regarding commercial success. I measured ANM’s
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`adoption of accused technologies by comparing its sales of accused pumps/air
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`controllers (as defined in paragraphs 14 and 17 and their footnotes above) to its sales
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`of accused mattresses (defined as those identified as “Accused” by ANM in Column
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`M of Exhibit 2057).15
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` I understand from Exhibit 2044 that Sleep Number asserts
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`that its ‘172 Patent, ‘154 Patent, and ‘747 Patent cover an entire mattress system.
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`23
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`Sleep Number Corp.
`SUPPLEMENTAL EXHIBIT 2030
`IPR2019-00500
`Page 25
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`24
`N4;
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`Sleep Number Corp.
`SUPPLEMENTAL EXHIBIT 2030
`|PR2019-00500
`
`Page 26
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`Sleep Number Corp.
`SUPPLEMENTAL EXHIBIT 2030
`IPR2019-00500
`Page 26
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`27.
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`27.—
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`—
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`25
`25
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`Sleep Number Corp.
`SUPPLEMENTAL EXHIBIT 2030
`|PR2019-00500
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`Page 27
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`Sleep Number Corp.
`SUPPLEMENTAL EXHIBIT 2030
`IPR2019-00500
`Page 27
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`28.
`N 9°
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`Sleep Number Corp.
`SUPPLEMENTAL EXHIBIT 2030
`|PR2019-00500
`
`Page 28
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`Sleep Number Corp.
`SUPPLEMENTAL EXHIBIT 2030
`IPR2019-00500
`Page 28
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`Conclusions
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`29. My analyses, based on the available data and evidence, consider
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`ANM’s unit sales and adoption of technologies asserted to read on Sleep Number’s
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`‘172 Patent, ‘154 Patent, and/or ‘747 Patent. My testimony is based on sufficient
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`facts and data, is the product of reliable principles and methods, and I have applied
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`the principles and methods reliably to the facts provided in this case to reach my
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`opinion. To isolate the impact of technologies asserted to read on Sleep Number’s
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`‘172 Patent, ‘154 Patent, and/or ‘747 Patent, I compare data by four different
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`“Periods” defined by information in ANM’s Exhibit 2052 showing the timeline
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`when ANM transitioned the relevant products to a new manifold and/or source code
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`technology and by relying upon information provided in Exhibits 2044, 2046, 2047,
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`2048, and 2049 (Sleep Number’s Infringement Contentions), Exhibit 2027
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`(Declaration of Dr. John Abraham), and Exhibit 2029 (Declaration of George
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`Edwards). I have not seen evidence that other factors impacted ANM’s unit sales at
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`these same transition points. To the extent other factors are brought to my attention,
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`I reserve the right to analyze and opine about them. Based upon my analyses detailed
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`above, I believe to a reasonable degree of certainty that there is clear evidence of
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`commercial success based on:
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`•
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`27
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`Sleep Number Corp.
`SUPPLEMENTAL EXHIBIT 2030
`IPR2019-00500
`Page 29
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`•
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`•
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`30. These analyses demonstrate that demand for technologies that read on
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`Sleep Number’s ‘172 Patent, ‘154 Patent, and ‘747 Patent exists. Regarding Sleep
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`Number’s ‘172 Patent, since July 2014, Table 2 and my analyses described above
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`show
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`. Specific to Sleep Number’s ‘154 Patent and
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`‘747 Patent, my review of Exhibit 2057, Exhibit 2052, Exhibit 2029, Table 1, Table
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`1A, Table 2, Appendix B, Appendix B_1, Appendix C, and Appendix C_1 and my
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`analyses described above show
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`28
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`Sleep Number Corp.
`SUPPLEMENTAL EXHIBIT 2030
`IPR2019-00500
`Page 30
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` My review of Exhibit 2057, Exhibit 2052, Exhibit 2029, Table 1, Table
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`1A, Table 2, Appendix B, Appendix B_1, Appendix C, and Appendix C_1 and my
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`analyses described above show
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` My review of Exhibit 2057, Exhibit 2052, Exhibit 2029, Table 1, Table 1A,
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`Table 2, Appendix B, Appendix B_1, Appendix C, and Appendix C_1 and my
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`analyses described above also
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