Select Comfort v. Baxter, et al.
`
` UNITED STATES DISTRICT COURT
` DISTRICT OF MINNESOTA
`
`-----------------------------------------------------------
`
`1198
`
`File No. 12-CV-2899
` (DWF/SER)
`
`St. Paul, Minnesota
`September 29, 2017
`9:00 a.m.
`
`)))))))))))))))))
`
`Select Comfort Corporation and
`Select Comfort SC Corporation,
`
` Plaintiffs/Counter-Defendants,
`
`vs.
`
`John Baxter; Dires, LLC d/b/a
`Personal Touch Beds and Personal
`Comfort Beds; Digi Craft Agency,
`LLC; Direct Commerce, LLC d/b/a
`Personal Touch Beds; Scott
`Stenzel; and Craig Miller,
`
` Defendants/Counter-Claimants.
`
`-----------------------------------------------------------
`
`BEFORE THE HONORABLE DONOVAN W. FRANK and a Jury
`UNITED STATES DISTRICT COURT JUDGE
`
`(TRIAL - VOLUME VI)
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`September 29, 2017 - Volume VI
`1 2 0 0
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`P R O C E E D I N G S
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`I N O P E N C O U R T
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`T H E C L E R K : A l l r i s e . T h e U n i t e d S t a t e s D i s t r i c t
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`C o u r t f o r t h e D i s t r ic t o f M i n n e s o t a i s n o w i n s e s s i o n . T h e
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`H o n o r a b l e D o n o v a n F r a n k p r e s i d i n g .
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`T H E C O U R T : Y o u m a y a l l b e s e a t e d . T h a n k y o u .
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`M r . K a r r , i f y o u w a n t t o r e -t a k e t h e s t a n d . A n d I
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`w o n ' t r e - a d m i n i s t e r t h e o a t h . Y o u r e m a i n u n d e r o a t h s i n c e
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`y e s t e r d a y .
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`T H E W I T N E S S : U n d e r s t o o d .
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`T H E C O U R T : A l l r i g h t . A s s o o n a s h e ' s r e a d y y o u
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`m a y i n q u i r e , c o u n s e l .
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`M R . M A D E L : T h a n k y o u , Y o u r H o n o r . A n d g o o d
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`m o r n i n g . G o o d m o r n i n g , l a d i e s a n d g e n t l e m e n o f t h e j u r y .
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`C R O S S - E X A M I N A T I O N
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`B Y M R . M A D E L : ( c o n t i n u e d )
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`18 Q.
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`G o o d m o r n i n g , M r . K a r r . W h e n w e l e f t o f f y e s t e r d a y w e
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`w e r e t a l k i n g a b o u t t h e S e l e c t C o m f o r t v e r s u s C o m f o r t a i r e
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`l a w s u it , r i gh t ?
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`A.
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`Y e s .
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` Proceedings recorded by mechanical stenography;
`transcript produced by computer.
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`22 Q.
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`A n d t h a t w a s f i l e d i n M a r c h o f 2 0 1 1 ?
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`23
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`A.
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`T h a t ' s c o r r e c t.
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`24 Q.
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`A n d I t h i n k t h e l a s t q u e s t i o n I j u s t a s k e d y o u w a s t h a t
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`25
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`t h e y m a d e t r a d e m a r k i n f r i n g e m e n t a l l e g a t i o n s a g a i n s t
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`1199
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`1 2 0 1
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`C o m f o r t a i r e i n t h a t l a w s u i t a n d y o u d e n i e d t h e m - - I m e a n
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`APPEARANCES
`
`For the Plaintiffs:
`
`For Defendants Dires,
`Digi Craft Agency,
`Direct Commerce, Scott
`Stenzel, and Craig
`Miller:
`
`For Defendant John
`Baxter:
`
`Fox Rothschild, LLP
`ANDREW S. HANSEN, ESQ.
`DENNIS E. HANSEN, ESQ.
`ELIZABETH A. PATTON, ESQ.
`Suite 2000
`222 South Ninth Street
`Minneapolis, Minnesota 55402
`
`Madel, PA
`CHRISTOPHER W. MADEL, ESQ.
`JENNIFER M. ROBBINS, ESQ.
`CASSANDRA B. MERRICK, ESQ.
`Suite 700
`800 Hennepin Avenue
`Minneapolis, Minnesota 55403
`
`Berens & Miller, PA
`BARBARA P. BERENS, ESQ.
`CARRIE L. ZOCHERT, ESQ.
`Suite 3720
`80 South Eighth Street
`Minneapolis, Minnesota 55402
`
`1
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`2
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`3
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`y o u r c o m p a n y d e n i e d t h e m , r i g h t ?
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`A.
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`A t t h e t i m e o f o u r r e s p o n s e .
`
`4 Q.
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`Y e s . A n d t h e y a l s o m a d e f e d e r a l d i l u t i o n o f t r a d e m a r k
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`5
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`6
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`a l le ga t io n s a g a i n s t y o u , r i gh t ?
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`A.
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`Y e s .
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`7 Q.
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`A n d y o u d e n i e d t h o s e ?
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`8
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`A.
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`A t t h e t i m e o f t h e r e s p o n s e , y e s .
`
`9 Q.
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`A n d t h e y m a d e f a l s e a d v e r t i s i n g a l l e g a t i o n s a g a i n s t y o u ,
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`10
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`11
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`r i g h t ?
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`A.
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`Y e s .
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`Court Reporters:
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`CARLA R. BEBAULT, RMR, CRR, FCRR
`LORI A. SIMPSON, RMR-CRR
`Suite 146
`316 North Robert Street
`St. Paul, Minnesota 55101
`
`12 Q.
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`A n d t h o s e w e r e d e n i e d ?
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`13
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`A.
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`A t t h e t i m e o f t h e r e s p o n s e , y e s .
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`14 Q.
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`S e l e c t C o m f o r t m a d e d e c e p t i v e t r a d e p r a c t i c e s c l a i m s
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`15
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`16
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`a g a i n s t C o m f o r t a i r e , r i g h t ?
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`A.
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`Y e s .
`
`17 Q.
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`T h o s e w e r e d e n i e d ?
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`18
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`A.
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`A t t h e t im e, y e s , a t t he t im e o f t h e f i li n g.
`
`19 Q.
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`T h e y m a d e u n l a w f u l t r a d e p r a c t i c e s c l a i m s a g a i n s t
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`20
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`21
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`C o m f o r t a i r e , r i g h t ?
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`A.
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`Y e s .
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`22 Q.
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`T h o s e w e r e d e n i e d ?
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`A.
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`Y e s .
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`24 Q.
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`A n d t h e y m a d e f e d e r a l u n f a i r c o m p e t i t i o n c l a i m s a g a i n s t
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`25
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`y o u , r i g h t ?
`
`Lori A. Simpson, RMR-CRR
`651-848-1225
`
`Page 1198 to Page 1201
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`Sleep Number Corp. - EXHIBIT 2034 - IPR2019-00500 - Page 1
`
`

`

`Select Comfort v. Baxter, et al.
`
`1282
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`REDIRECT EXAMINATION
`1
`BY MR. DENNIS HANSEN:
`2
`Good morning again, Mr. Karr.
`3 Q.
`Good morning.
`4 A.
`I'm going to have Dorian call up on the screen
`5 Q.
`Defendants' Exhibit 199. Do you have it there with you?
`6
`I believe I do.
`7 A.
`This is an e-mail between you and Jimmy Orders on
`8 Q.
`December 4, 2012?
`9
`Yes.
`10 A.
`What did you take Mr. Orders to mean when he said,
`11 Q.
`"Maybe we need to go ahead and sue John"?
`12
`Well, you have to remember that John had what we
`13 A.
`believed breached an agreement. He had actually started up
`14
`another website company while he was employed by Park Place
`15
`and that was what Jimmy was talking about at this point.
`16
`And if we go to Plaintiffs' 620, what did -- I'll let
`17 Q.
`you get there.
`18
`Thank you.
`19 A.
`What did Mr. Baxter say to you, how did he respond when
`20 Q.
`you challenged him for being involved in Personal Touch?
`21
`He denied it.
`22 A.
`You were asked about an advertisement from 2009 in the
`23 Q.
`Lincoln Star Journal.
`24
`Yes.
`25 A.
`
`September 29, 2017 - Volume VI
`1284
`settlement agreement, which is Disclaimer on Comparative
`1
`Advertising.
`2
`Correct.
`3 A.
`At the time that you were required to use this
`4 Q.
`disclaimer, were you still running the advertisements that
`5
`Mr. Baxter had described as misleading and deceptive?
`6
`We were not.
`7 A.
`No further questions, Mr. Karr. Thank you.
`8 Q.
`MR. MADEL: Nothing, Your Honor.
`9
`THE COURT: You may step down, sir.
`10
`THE WITNESS: Thank you, sir.
`11
`THE COURT: You may call your next witness.
`12
`MS. MERRICK: Your Honor, in the meantime may I
`13
`approach to get the exhibits off there?
`14
`THE COURT: I was just going to suggest that, yes.
`15
`I didn't think the witness, whoever it is, will...
`16
`MR. DENNIS HANSEN: Your Honor, the plaintiffs
`17
`call Craig Miller.
`18
`THE COURT: Mr. Miller, if you want to step
`19
`forward, sir. Before you step up, if you would please raise
`20
`your right hand.
`21
` (Witness sworn)
`22
`THE COURT: And there are a couple steps up there.
`23
`And then as you may have heard me say to a couple of the
`24
`other -- or really every witness, you can move the chair
`25
`
`1283
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`1285
`where it's comfortable for you and then the microphone base
`1 Q.
`Who controls and runs the advertising by third-party
`1
`moves as well, but you have to stay and speak fairly close
`retailers?
`2
`2
`into the mike.
`The third-party retailer.
`3 A.
`3
`If you would please state your full name and spell
`You were asked about the timing of Comfortaire's lawsuit
`4 Q.
`4
`your last name.
`against the defendants. When did you first see the
`5
`5
`THE WITNESS: Craig Salvatore Miller, Jr.
`Comfortaire bed on sale on an advertisement that the
`6
`6
`M-i-l-l-e-r.
`defendants run?
`7
`7
`THE COURT: You may inquire, Counsel.
`To the best of my recollection, it was in the fall of
`8 A.
`8
`(Craig Miller, Jr.)
`2013.
`9
`9
`CROSS EXAMINATION
`And was that before or after the acquisition by Select
`10 Q.
`10
`BY MR. DENNIS HANSEN:
`Comfort?
`11
`11
`Good morning, Mr. Miller.
`12 Q.
`That was after the acquisition.
`12 A.
`Good morning.
`13 A.
`If we go to Defense 198, which you were asked about, you
`13 Q.
`We've obviously met before, correct?
`14 Q.
`see you say, "This gives us exclusive use of SCSS trademarks
`14
`Correct.
`15 A.
`for now." Do you see that?
`15
`You are the head of Dires, correct?
`16 Q.
`I do.
`16 A.
`Correct.
`17 A.
`What did you mean when you said that?
`17 Q.
`Dires sells Personal Comfort beds to consumers?
`18 Q.
`Well, we had a settlement agreement whereby Select
`18 A.
`Yes.
`19 A.
`Comfort had allowed us to use "compare to Select Comfort"
`19
`And by head of Dires, you're the principal manager,
`20 Q.
`and "compare to Sleep Number" in our Google ads and that's
`20
`correct?
`what I was referring to there, that we had exclusive use to
`21
`21
`Yes.
`22 A.
`that.
`22
`And everybody reports up to you within Dires?
`23 Q.
`And was there any secret deal with Select Comfort?
`23 Q.
`Yes.
`24 A.
`No.
`24 A.
`Mr. Baxter and Mr. Stenzel needed or need your approval
`25 Q.
`Plaintiffs' 616, you were asked about paragraph 7 of the
`25 Q.
`Lori A. Simpson, RMR-CRR
`651-848-1225
`
`Page 1282 to Page 1285
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`Sleep Number Corp. - EXHIBIT 2034 - IPR2019-00500 - Page 2
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`

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`Select Comfort v. Baxter, et al.
`
`1286
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`September 29, 2017 - Volume VI
`1288
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`to enter into contracts with third parties, correct?
`
`Correct.
`
`And you have the power to veto decisions made by
`
`That's correct.
`
`And for all intents and purposes the buck stops with you
`
`Yes.
`
`Let's first talk about the phrase "number bed." The
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`setting, correct?
`
`A.
`
`Some do with numeric settings. Some without numeric
`
`And the ones that do adjust with numeric settings aren't
`
`That's correct.
`
`Do the medical beds have medical-grade foam?
`
`Well, they have -- when you say, "medical-grade foam,"
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`if it's foam used in a medical bed, is that a medical-grade
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`foam or are you talking about foam that would go into a
`
`1
`2
`A.
`3 Q.
`4
`Mr. Baxter and Mr. Stenzel?
`5
`A.
`6 Q.
`7
`at Dires, right?
`8
`A.
`9 Q.
`10
`medical beds sold by American National adjust with a numeric
`11
`12
`13
`settings.
`14 Q.
`15
`called number beds?
`16
`A.
`17 Q.
`18
`A.
`19
`20
`21
`wound bed or something of that nature?
`22 Q.
`23
`A.
`24 Q.
`25
`A.
`
`I'm just asking your understanding.
`
`Ask the question again.
`
`Do the medical beds have medical-grade foam?
`
`I suppose we call it medical-grade foam because of the
`
`1287
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`fact, view "number bed" as something associated with one
`
`source?
`
`I disagree with that.
`
`You had your deposition taken in this case, correct,
`
`Right.
`
`You had it taken three times?
`
`Yes, I did, three times.
`
`Once was on behalf of yourself personally, correct?
`
`Yes.
`
`And in that deposition you were -- at the time you were
`
`That's right.
`
`And there was a time where you were deposed as the
`
`correct?
`
`Correct.
`
`And so your dispute with me is that you don't believe
`
`I don't believe so, no.
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`But you haven't done any studies on that?
`
`No, I have never done a study.
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`Let's call up on the screen Plaintiff 124. Do I have
`
`1
`2
`3
`A.
`4 Q.
`5
`Mr. Miller?
`6
`A.
`7 Q.
`8
`A.
`9 Q.
`10
`A.
`11 Q.
`12
`the head of Dires, right?
`13
`A.
`14 Q.
`15
`30(b)(6) representative of Personal Comfort or Dires,
`16
`17
`A.
`18 Q.
`19
`consumers could ever associate "number bed" with one source?
`20
`A.
`21 Q.
`22
`A.
`23 Q.
`24
`binders for you there, Mr. Miller?
`25
`
`A.
`
`No.
`
`Generally in internal communications between American
`
`National sells are not referred to as number beds?
`
`That's correct.
`In 2006 American National was not marketing its consumer
`
`Correct.
`
`In fact, American National has never marketed its
`
`That's right.
`The only time that you've been associated with a company
`
`started selling the Personal Comfort line of beds?
`
`Correct.
`
`And that's the time that you went into business with
`
`1
`2
`3
`4
`5
` (Binders handed to the Court)
`6
`BY MR. DENNIS HANSEN:
`7 Q.
`8
`A.
`9 Q.
`10
`A.
`11 Q.
`Plaintiffs' 124 is a printout of multiple pages from
`12
`American National's website at
`13
`14
`A.
`15 Q.
`16
`second paragraph, the last sentence, it says, "American
`17
`18
`A.
`19 Q.
`20
`A.
`21 Q.
`22
`category?
`23
`A.
`24 Q.
`25
`product category at the time?
`Lori A. Simpson, RMR-CRR
`651-848-1225
`
`1
`standard of the foam that we use, I suppose.
`2 Q.
`3
`National and Sizewise, the consumer beds that American
`4
`5
`A.
`6 Q.
`7
`air beds as number beds, right?
`8
`A.
`9 Q.
`10
`consumer air beds as number beds?
`11
`A.
`12 Q.
`13
`using the phrase "number bed" is when Dires was formed and
`14
`15
`A.
`16 Q.
`17
`Mr. Stenzel, correct?
`18
`A.
`19 Q.
`20
`A.
`21 Q.
`22
`"number bed" and what consumers take it to mean?
`23
`A.
`24 Q.
`25
`continue using the phrase "number bed" if consumers do, in
`
`Yes.
`And Mr. Baxter?
`
`Yes.
`
`No.
`
`You have not done any studies with respect to the phrase
`
`You don't know whether it's fair for Personal Comfort to
`
`1289
`MR. DENNIS HANSEN: May I approach, Your Honor?
`
`THE COURT: You may.
`
`MR. DENNIS HANSEN: Would Your Honor like binders?
`
`THE COURT: All right.
`
`The first binder there should be Plaintiffs' 124.
`
`I was looking for 231. Sorry.
`
`Sorry if I said the wrong number.
`
`Okay.
`
`americannationalmanufacturing.com?
`
`Yes.
`
`On the About Us page on the front of the exhibit, in the
`
`National produced its first air mattress in 1986," right?
`
`Yes.
`American National did not use the name Number Bed?
`
`We did not.
`
`And you didn't do so because it wasn't the product
`
`Say that again.
`
`You didn't use "number bed" here because it wasn't the
`
`Page 1286 to Page 1289
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`Sleep Number Corp. - EXHIBIT 2034 - IPR2019-00500 - Page 3
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`

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`Select Comfort v. Baxter, et al.
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`1290
`
`September 29, 2017 - Volume VI
`1292
`
`A.
`
`Correct. We were selling them in the water bed
`
`And in 1986 you would refer to this type of product as a
`
`That's correct.
`
`That was a bed that was adjustable by a firmness numeric
`
`A.
`
`Yeah, it had a number on the remote control that
`
`continually maintained the pressure at a constant set
`
`Okay. If you flip in your binder to Defendants' 420.
`
`MR. DENNIS HANSEN: And Dorian, don't put it up on
`
`the screen yet, please.
`
`1
`2
`industry.
`3 Q.
`4
`computerized air bed?
`5
`A.
`6 Q.
`7
`indicator, correct?
`8
`9
`10
`pressure.
`11 Q.
`12
`13
`14
`BY MR. DENNIS HANSEN:
`15 Q.
`16
`A.
`17 Q.
`18
`that binder.
`19
`A.
`20 Q.
`21
`American National's computerized air bed, correct?
`22
`23
`24
`25
`
`I think it's in the binder labeled 2 of 2.
`
`420?
`
`420, defendants' 420. It will be at the very back of
`
`Yes.
`
`Defendants' Exhibit 420 is a series of photographs of
`
`A.
`
`Actually, the first image is not American National's.
`
`That one is a product called Sommaire. If you go to the
`
`back of that page, it does say, "Sommaire" on it. And then
`
`you have another page with a female sitting on a blue
`
`At what dates, did you say?
`
`In between 1986 and 2012.
`
`Yes.
`
`And they launched it in 2001, right?
`
`That's when they -- yes, correct.
`
`And that was right in the middle of 1986 to 2012, right?
`
`Yes.
`
`And that brand became the dominant brand in the
`
`Yes.
`
`In fact, you agree that Sleep Number is the most
`
`Correct.
`
`And you concede that Number Bed only came into existence
`
`1
`A.
`2 Q.
`3
`A.
`4 Q.
`5
`A.
`6 Q.
`7
`A.
`8 Q.
`9
`adjustable air bed market?
`10
`A.
`11 Q.
`12
`well-known brand in the adjustable air bed market?
`13
`A.
`14 Q.
`15
`as more efforts were put forward to educate the public about
`16
`17
`18
`19
`20
`21
`22
`23
`24
`BY MR. DENNIS HANSEN:
`25 Q.
`
`mattresses that have an indicator of firmness which caused
`
`the consumer to become more aware?
`
`MR. MADEL: Objection, compound.
`
`THE COURT: It's a compound question, but did you
`
`understand it?
`
`THE WITNESS: Can you break it up into smaller
`
`pieces?
`
`THE COURT: If we can just break it down a bit.
`
`Do you remember talking about this in your deposition?
`
`1291
`mattress next to our remote control with the numbers on it.
`
`Okay.
`
`MR. DENNIS HANSEN: Move to admit 420.
`
`MR. MADEL: No objection.
`THE COURT: Received.
`
`If you go to the third page, this is the American
`
`That's correct.
`
`And it was adjustable by a firmness setting?
`Yes.
`
`And you weren't calling it a number bed?
`
`Correct.
`
`So you concede that in 1986 or thereabouts number bed
`
`1
`A.
`2 Q.
`3
`came into existence as more efforts were put forward to
`4
`5
`of firmness?
`6
`A.
`Yes.
`7 Q.
`8
`consumer to become more aware?
`9
`A.
`10 Q.
`11
`Comfort spent over a billion dollars in advertising since
`12
`2001, right?
`13
`A.
`14 Q.
`15
`Number bed?
`16
`A.
`17 Q.
`18
`effort was put forward by Select Comfort to make the
`19
`consumer aware about the Sleep Number bed?
`20
`A.
`21 Q.
`22
`put that amount of money behind advertising?
`23
`A.
`24 Q.
`25
`A.
`Lori A. Simpson, RMR-CRR
`651-848-1225
`
`1
`2
`That is the product I am speaking of.
`3 Q.
`4
`5
`6
`7
`BY MR. DENNIS HANSEN:
`8 Q.
`9
`National computerized air mattress?
`10
`A.
`11 Q.
`12
`A.
`13 Q.
`14
`A.
`15 Q.
`16
`was not the category name?
`17
`A.
`18 Q.
`And you can't say or don't know exactly when it became a
`19
`category?
`20
`A.
`21 Q.
`22
`when Personal Comfort opened?
`23
`A.
`24 Q.
`25
`Select Comfort launched the Sleep Number brand?
`
`That's right.
`
`Correct.
`
`You didn't start using "number bed" until September 2012
`
`Correct, when we became forward consumer facing.
`
`And you would concede that in between 1986 and 2012
`
`I do.
`
`Okay. And do you remember indicating that Number Bed
`
`1293
`
`educate the public about mattresses that have an indicator
`
`And do you remember indicating that that caused the
`
`Yes.
`
`Okay. And you've heard the testimony that Select
`
`Yes.
`
`And that's to educate the consumer about the Sleep
`
`Correct.
`
`You have no reason to doubt that amount of money and
`
`No.
`
`You don't know any other bed brand -- air bed brand that
`
`Correct.
`
`And no other brand really even comes close, does it?
`
`No.
`
`Page 1290 to Page 1293
`
`Sleep Number Corp. - EXHIBIT 2034 - IPR2019-00500 - Page 4
`
`

`

`Select Comfort v. Baxter, et al.
`
`1294
`
`September 29, 2017 - Volume VI
`1296
`
`If we turn back to Plaintiffs' 124. Sorry for the
`
`I'll figure it out. Okay.
`
`Let's go to page 11 of the document. You'll see there's
`
`flip from pages 11 through 15, these are images and
`
`information about the Instant Comfort line of beds sold by
`
`American National, correct?
`
`Correct.
`
`If we look at page 11 in particular, the heading is Air
`
`1 Q.
`2
`binder logjam you have up there.
`3
`A.
`4 Q.
`5
`numbers at the very bottom of the page, Mr. Miller. If you
`6
`7
`8
`9
`A.
`10 Q.
`11
`Beds, right?
`12
`A.
`13 Q.
`14
`A.
`15 Q.
`16
`setting, right?
`17
`A.
`18 Q.
`19
`date of when this was printed?
`20
`A.
`21 Q.
`22
`A.
`23 Q.
`24
`A.
`25 Q.
`
`That's right.
`
`It doesn't say "number beds"?
`
`No.
`
`And all of these beds are adjustable by a numeric
`
`That's correct.
`
`And do you see at the very bottom of the page there's a
`
`Yes.
`
`It's March 4, 2014, right?
`
`That's right.
`
`It says, "Air Beds - American National Manufacturing"?
`
`Yes.
`
`If we go to page 12, there's two beds listed here,
`
`That was going to be sold?
`
`Correct.
`
`And if you look at the bottom of the page, the Instant
`
`Available," right?
`
`Yes.
`
`And that was another one that was adjustable by a
`
`A.
`
`Correct. That one actually had multiple zones of
`
`And it wasn't called a number bed?
`
`No.
`
`Go to Plaintiffs' Exhibit -- sorry, Defendants'
`
`1 Q.
`2
`A.
`3 Q.
`4
`Comfort 10k3, it says, "Simply the Best Air Mattress
`5
`6
`A.
`7 Q.
`8
`number?
`9
`10
`adjustability.
`11 Q.
`12
`A.
`13 Q.
`14
`Exhibit 175, so we are switching binders again. Sorry about
`15
`16
`A.
`17 Q.
`18
`National Manufacturing, correct?
`19
`A.
`20 Q.
`21
`A.
`22 Q.
`23
`A.
`24 Q.
`25
`correct?
`
`that, Mr. Miller. Are you with me on 175?
`
`Yes.
`
`175 is the Owner's Manual for beds made by American
`
`That's correct.
`
`And these are called air mattress systems, right?
`
`Yes.
`
`Not number beds?
`
`Correct.
`
`And all of these do have a numeric firmness setting,
`
`correct?
`
`That's 12 you have there?
`
`If you look at the very bottom, there's page numbers,
`
`Page 12.
`See where I am at?
`
`Yes.
`
`So there's two beds there and those are both Instant
`
`Yes, they are.
`
`That's correct.
`
`And if we look at the next page, page 13, it's another
`
`1
`2
`A.
`3 Q.
`4
`Plaintiff #124 - p. 12?
`5
`A.
`6 Q.
`7
`A.
`8 Q.
`9
`Comfort beds?
`10
`A.
`11 Q.
`And they're both called air mattresses in the
`12
`advertisement, right?
`13
`A.
`14 Q.
`15
`Instant Comfort bed and it's advertised as a premium air
`16
`17
`A.
`18 Q.
`If we go through all of these beds from page 11 to 15,
`19
`they're all called an air mattress, right?
`20
`A.
`21 Q.
`22
`A.
`23 Q.
`24
`hybrid bed?
`25
`
`mattress?
`
`Yes.
`
`Yes.
`
`None of them are called number beds?
`
`Correct.
`
`And if you look at page 16, these are the -- this is a
`
`A.
`
`Yes.
`
`1295
`
`1297
`
`Yes.
`
`Hopefully it's the last time I am going to ask you to do
`
`Plaintiffs' Exhibit 128 is a printout of the website at
`
`1
`A.
`2 Q.
`3
`it in a while, but switch binders again to Plaintiff 128.
`4
`5
`shopcorona.com, right?
`6
`A.
`That's correct.
`7 Q.
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`Lori A. Simpson, RMR-CRR
`651-848-1225
`
`And American National advertised through shopcorona.com?
`
`MR. MADEL: Your Honor, may we approach?
`
`THE COURT: You may.
`
`MR. MADEL: Take that off the screen, please.
`
`(At sidebar)
`MR. MADEL: A nonstipulated exhibit that has been
`
`displayed to the jury and it's hearsay.
`
`MR. DENNIS HANSEN: I believe -- I have to check
`
`my records. I think there was admissibility agreed on the
`
`initial exhibit list.
`
`MR. MADEL: I have got the list right in front of
`
`me and Ms. Robbins has confirmed it.
`MS. BERENS: I agree it's hearsay.
`
`MR. DENNIS HANSEN: Then I will lay foundation
`
`that it's their advertising.
`
`THE COURT: All right. Before we do that, he has
`
`to look a copy of it before we put it back up on the screen.
`
`MR. DENNIS HANSEN: Yeah.
`
`THE COURT: Without claiming that I have the
`
`Page 1294 to Page 1297
`
`Sleep Number Corp. - EXHIBIT 2034 - IPR2019-00500 - Page 5
`
`

`

`Select Comfort v. Baxter, et al.
`
`1298
`
`original exhibit list, but the one I have says objection on
`it.
`
`MR. DENNIS HANSEN: The objection is hearsay?
`MR. MADEL: But I think you had the previous list
`which everything literally was objected to. We then went
`through --
`THE COURT: Right.
`MR. MADEL: -- and made a stipulation to a bunch
`
`of stuff.
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`THE COURT: We'll just go ahead. If he needs it,
`10
`but not put it up on the screen.
`11
`MR. DENNIS HANSEN: The objection is hearsay?
`12
`MR. MADEL: Yep.
`13
`(In open court)
`14
`BY MR. DENNIS HANSEN:
`15
`Mr. Miller, Exhibit 128, this is --
`16 Q.
`THE COURT: We don't want it up.
`17
`MR. DENNIS HANSEN: Put it down.
`18
`THE COURT: Thank you.
`19
`BY MR. DENNIS HANSEN:
`20
`128 is a website that American National advertised on?
`21 Q.
`Yes.
`22 A.
`And it advertised Personal Comfort beds on this?
`23 Q.
`Correct.
`24 A.
`And the printout that you have before you, 128, reflects
`25 Q.
`1299
`
`September 29, 2017 - Volume VI
`1300
`THE WITNESS: I don't know what he provided and
`1
`what he might have grabbed from a Personal Comfort website
`2
`or our website. I just don't know. I wasn't involved in
`3
`this in any way.
`4
`BY MR. DENNIS HANSEN:
`5
`So the information was grabbed from your website or
`6 Q.
`Personal Comfort's website?
`7
`No. What I said is I don't know where the information
`8 A.
`was obtained from.
`9
`What's your brother's role at American National?
`10 Q.
`My brother is in charge of our contract manufacturing
`11 A.
`side of our business.
`12
`Okay. And you know that he provided information to Shop
`13 Q.
`Corona?
`14
`15
`16
`17
`THE WITNESS: I don't know.
`18
`BY MR. DENNIS HANSEN:
`19
`All right. Let's go to Plaintiffs' 642.
`20 Q.
`MR. DENNIS HANSEN: Can you take that down for a
`21
`minute, Dorian.
`22
`THE WITNESS: This goes from 639.
`23
`BY MR. DENNIS HANSEN:
`24
`You don't have 642 in your binder?
`25 Q.
`
`MR. MADEL: Objection, asked and answered.
`THE COURT: I think your answer was you don't
`
`know?
`
`1301
`
`No.
`
`1 A.
`American National's advertisements for Personal Comfort,
`1
`MR. DENNIS HANSEN: May I approach, Your Honor?
`correct?
`2
`2
`THE COURT: You may.
`It was not a paid advertisement. What this is is a
`3 A.
`3
`MR. MADEL: Is this Plaintiffs' or Defendants'?
`local -- my brother is involved in local, you know, city
`4
`4
`MR. DENNIS HANSEN: It's Plaintiffs'.
`politics type stuff and the city of Corona put on this
`5
`5
`THE WITNESS: Got it. Thank you.
`little Shop Corona thing and they were trying to promote
`6
`6
`MR. DENNIS HANSEN: Okay. Dorian, you can put
`businesses that are making products in the Corona area. So
`7
`7
`that up on the screen.
`this is something that they reached out to my brother for.
`8
`8
`BY MR. DENNIS HANSEN:
`And so your brother as a representative of American
`9 Q.
`9
`642 is, Mr. Miller, an e-mail chain where you forwarded
`10 Q.
`National put these ads on the Shop Corona website?
`10
`the agenda and presentation that Mr. Baxter and Mr. Stenzel
`Yes. Well, the gentleman that worked for Shop Corona is
`11 A.
`11
`put together for a meeting you had in Orlando with them,
`the one who did it. He went and obtained obviously some
`12
`12
`correct?
`information from my brother at some point in time and the
`13
`13
`That's correct.
`14 A.
`gentleman from Shop Corona is the one that did this.
`14
`And the purpose of the meeting was to discuss forming
`15 Q.
`And you authorized these advertisements to be put up?
`15 Q.
`Dires?
`No.
`16 A.
`16
`The possibility of forming Dires.
`17 A.
`Your brother did?
`17 Q.
`Okay. And if we look at your e-mail on the second page
`18 Q.
`He provided some information to this gentleman from Shop
`18 A.
`dated May 22, 2012 at 3:41 p.m., do you see where I'm at?
`Corona, but I never even knew they were there.
`19
`19
`Yes.
`20 A.
`Did your brother approve them to do it?
`20 Q.
`You say, "Hello all. Attached is some information about
`21 Q.
`I don't know if he approved them to do it. Obviously he
`21 A.
`the people we are meeting with tomorrow on the consumer air
`provided them some information.
`22
`22
`mattresses." Do you see that?
`Okay. And that information is reflected on these pages?
`23 Q.
`23
`Yes.
`24 A.
`MR. MADEL: Objection, foundation.
`24
`You didn't say, "on the number beds"?
`25 Q.
`THE COURT: If you know, sir, you may answer.
`25
`Lori A. Simpson, RMR-CRR
`651-848-1225
`
`Page 1298 to Page 1301
`
`Sleep Number Corp. - EXHIBIT 2034 - IPR2019-00500 - Page 6
`
`

`

`Select Comfort v. Baxter, et al.
`
`1302
`
`September 29, 2017 - Volume VI
`1304
`
`Correct.
`
`And you expected that everybody who is receiving this
`
`Yes.
`
`You're familiar with International Sleep Products
`
`Yes, I am.
`
`And you don't know one way or the other whether ISPA
`
`1
`A.
`2 Q.
`3
`would understand what types of beds you were talking about?
`4
`A.
`5 Q.
`6
`Association, right?
`7
`A.
`8 Q.
`9
`categorized number beds as a category of beds?
`10
`11
`12
`them classifying beds as.
`13 Q.
`14
`called air beds?
`15
`16
`17
`noninner spring.
`18 Q.
`19
`It's a copy of the Personal Comfort Owner's Manual, correct?
`20
`A.
`21 Q.
`22
`the customer on their purchase of a Personal Comfort bed,
`23
`24
`A.
`25 Q.
`
`A.
`
`They actually classify them as inner spring or noninner
`
`spring. So those are the two classifications that I recall
`
`And you're not aware that they have a classification
`
`A.
`
`They possibly do. I just don't recall if they actually
`
`call them air beds or not or if that was a subset of
`
`Let's go to Plaintiffs' 678. It's -- are you there?
`
`Correct.
`
`And on page 3 of the Owner's Manual it congratulations
`
`correct?
`
`Correct.
`
`In the fifth paragraph it reads, "In 1995, we became the
`
`than use the binders, but you're free to do so, of course.
`
`Plaintiffs' 164 is an e-mail from
`
`info@personalcomfortbed to a Thomas -- I am going to butcher
`
`his name -- Hoffpauir and Mr. Hoffpauir had had his bed
`
`shipped by Personal Comfort Bed, correct?
`
`Yes.
`
`And this was kind of the congratulations, here comes
`
`1
`2
`3
`4
`5
`6
`A.
`7 Q.
`8
`your bed e-mail that Personal Comfort would send out to
`9
`10
`A.
`11 Q.
`12
`as you are and look forward to hearing about your better
`13
`14
`15
`A.
`16 Q.
`17
`A.
`18 Q.
`19
`"adjustable air bed" versus "number bed," right?
`20
`A.
`21 Q.
`22
`deciding when to use "adjustable air bed" versus "number
`23
`24
`A.
`25 Q.
`
`customers?
`
`Yes.
`
`In the second paragraph it says, "We are just as excited
`
`night's sleep on the best adjustable air bed in the
`
`industry," right?
`
`Yes.
`
`And it doesn't use the phrase "number bed," does it?
`
`No.
`
`Dires doesn't have any written policy on whether to use
`
`Correct.
`
`And Dires doesn't even have really a thought process in
`
`bed"?
`
`We have no policy, no.
`
`Okay. And you claim you have never been involved in any
`
`1303
`
`1305
`
`1
`2
`A.
`3 Q.
`4
`since 2012, right?
`5
`A.
`6 Q.
`7
`Exhibit 243, page 1, which is just a one-page exhibit, but
`8
`9
`10
`11
`right?
`12
`A.
`Correct.
`13 Q.
`14
`"Yes, um, I saw the advertisement for the 50 percent off
`15
`16
`17
`18
`19
`20
`A.
`21 Q.
`22
`about number beds, Lauren says, "We're not Sleep Number"?
`23
`A.
`24 Q.
`25
`between that and a Number Bed?"
`Lori A. Simpson, RMR-CRR
`651-848-1225
`
`A.
`I could read through the whole thing. I haven't read
`through the whole manual, so I don't know one way or the
`
`You have no idea?
`
`Correct.
`
`Okay. Call up Plaintiffs' Exhibit 1, page 64.
`
`might be easier for you just to look at the screen rather
`
`only adjustable firmness consumer air mattress that is
`
`manufactured in our FDA registered manufacturing facility."
`
`Correct?
`
`Correct.
`
`Yes.
`
`It doesn't call the bed a number bed on this page,
`
`Correct.
`
`On this document?
`
`In the Personal Comfort Owner's Manual.
`
`I didn't do page by page, but I'm sure you did.
`
`You have no reason to dispute that it doesn't, right,
`
`1
`2
`3
`4
`A.
`5 Q.
`It calls the bed an adjustable firmness consumer air
`6
`mattress, right?
`7
`A.
`8 Q.
`9
`right?
`10
`A.
`11 Q.
`And it doesn't call the bed a number bed anywhere in the
`12
`document, does it?
`13
`A.
`14 Q.
`15
`A.
`16 Q.
`17
`use "number bed" in the document?
`18
`19
`20
`other.
`21 Q.
`22
`A.
`23 Q.
`24
`Mr. Miller, this is a really small one page document, so it
`25
`
`discussions on when or when not to use "number bed"?
`
`Correct.
`
`And you're aware that this lawsuit has been going on
`
`Yes.
`I am going to call up on the screen Plaintiffs'
`
`you're free to find it in your binder as well.
`
`This is a transcript of a telephone call that a
`
`Personal Comfort sales representative had with a customer,
`
`And the customer, who is identified as "Woman," says,
`
`year-end closeout on Number Beds. And I was wondering what
`
`the cost would be for a king size."
`
` Lauren responds: "Okay, we are, we're not Sleep Number,
`
`we're Personal Comfort."
`Do you see that?
`
`Yes.
`
`And so in response to the customer saying and inquiring
`
`That's correct.
`
`And the woman then says, "I see. What's the difference
`
`Page 1302 to Page 1305
`
`Sleep Number Corp. - EXHIBIT 2034 - IPR2019-00500 - Page 7
`
`

`

`Select Comfort v. Baxter, et al.
`
`1306
` And Lauren says, "Um, we're just, we're just an upgraded
`version of Number Bed [sic]."
`Do you see that?
`
`1
`2
`3
`4 A.
`Yes.
`5 Q.
`So, again, she's equating Number Bed with Sleep Number?
`6 A.
`Unless she's equating that to be a descriptor for the
`category of products as well. I don't know what -- I can't
`7
`say for certain.
`8
`Well, you think she's saying, "We're not Sleep Number"
`9 Q.
`as a descriptor of the category?
`10
`MR. MADEL: Objection, foundation.
`11
`THE COURT: If you have an opinion what it means
`12
`to you, you may say so.
`13
`THE WITNESS: Ask the question again.
`14
`BY MR. DENNIS HANSEN:
`15
`Well, in this document the customer says, "Number Bed,"
`16 Q.
`right?
`17
`That's right.
`18 A.
`And the Personal Comfort employee responds, "We're not
`19 Q.
`Sleep Number," right?
`20
`Correct.
`21 A.
`And Lauren is not saying, "We're not Sleep Number"
`22 Q.
`because we're not a descriptor, right, she's saying, "We're
`23
`not Sleep Number," the company?
`24
`That's correct.
`25 A.
`
`September 29, 2017 - Volume VI
`1308
`
`1 A.
`Yes.
`2 Q.
`And the Personal Comfort employee responds, "The Sleep
`Number bed? Yes." Correct?
`3
`Correct.
`4 A.
`Would you go to Defendants' 500.0158 in your binder. It
`5 Q.
`is .0158.
`6
`Yes.
`7 A.
`And this is another transcript between a Personal
`8 Q.
`Comfort employee and a customer?
`9
`Correct.
`10 A.
`Okay. If we go to page 3, towards the bottom of the
`11 Q.
`page, if we count up one, two, three, four, five entries
`12
`from the bottom.
`13
`Okay.
`14 A.
`The caller says, "Is this the Number Bed?"
`15 Q.
`Yes.
`16 A.
`And Roger says, "We're Personal Comfort Bed. We're the
`17 Q.
`second largest air mattress manufacturer in the U.S. We're
`18
`the ones that put Sleep Number on the map." Do you see
`19
`that?
`20
`Yeah, but actually it said, "Is this like Number Bed,"
`21 A.
`not "Is this Number Bed?"
`22
`I read that wrong. Thank you, Mr. Miller. "Is this
`23 Q.
`like Number Bed?"
`24
`Yes.
`25 A.
`
`1307
`
`1 Q.
`Let's go to Plaintiff 236, which is another -- I guess
`it's a multipage transcript, but I will focus on the
`2
`beginning. Do you have 236 in that binder?
`3
`I am going to check right now.
`4 A.
`It's not, Mr. Miller. We have yet another binder for
`5 Q.
`you.
`6
`Awesome.
`7 A.
` (Binder handed to witness)
`8
`Thank you.
`9 A.
`You're welcome.
`10 Q.
`MR. DENNIS HANSEN: Your Honor, would you like a
`11
`binder of these transcri