UNITED STATES PATENT AND TRADEMARK OFFICE
`_____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`_____________
`
`WALMART INC.,
`Petitioner,
`
`v.
`
`CARAVAN CANOPY INTERNATIONAL, INC.,
`Patent Owner.
`_____________
`
`Case No. IPR2020-01026
`Patent No. 5,944,040
`Issue Date: AUGUST 31, 1999
`Title: COLLAPSIBLE TENT FRAME
`_____________
`
`PATENT OWNER’S PRELIMINARY RESPONSE
`PURSUANT TO 37 C.F.R. § 42.107
`
`
`
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`TABLE OF CONTENTS
`
`Page
`INTRODUCTION ........................................................................................... 1
`I.
`BACKGROUND ............................................................................................. 2
`II.
`III. THE BOARD SHOULD EXERCISE ITS STATUTORY DISCRETION
`AND DENY INSTITUTION .......................................................................... 3
`A.
`The Co-Pending Related Litigations ..................................................... 4
`B.
`The Apple Factors Favor Denial............................................................ 6
`1.
`Existence of a Stay (Apple Factor 1) .......................................... 7
`2.
`Trial Timing (Apple Factor 2) ..................................................... 7
`3.
`Investment in the Parallel Proceedings (Apple Factor 3)............ 7
`4.
`Petition Timing (Apple Factor 3 Continued) .............................. 9
`5.
`Overlap in Issues (Apple Factor 4) ........................................... 10
`6. Whether the Parties are the Same (Apple Factor 5) .................. 13
`7.
`Other Circumstances (Apple Factor 6) ...................................... 14
`a)
`Strength of the Merits ..................................................... 14
`b)
`§ 325(d) Implications ...................................................... 14
`c)
`Quality, Efficiency, and Fairness Concerns
`Underlying the AIA ........................................................ 15
`IV. LEVEL OF ORDINARY SKILL IN THE ART ........................................... 15
`V.
`CLAIM CONSTRUCTION .......................................................................... 16
`VI. WALMART HAS NO REASONABLE LIKELIHOOD OF SUCCESS ..... 16
`A. Walmart’s Motivations To Combine The References Lack Any
`Rational Underpinning ........................................................................ 17
`1. Walmart’s Proposed Combinations Would Not Increase
`Headroom .................................................................................. 18
`2. Walmart’s Reasoning For Increasing Canopy Pitch Is
`Contradicted By Contemporaneous Art .................................... 28
`3. Walmart’s Proposed Modifications To Tsai and Yang
`Would Actually Increase Canopy Sag ...................................... 34
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`B.
`
`2.
`
`3.
`4.
`5.
`
`6.
`7.
`8.
`
`b)
`
`Individual Deficiencies In The Grounds Of Unpatentability .............. 40
`Grounds 1-3 Generally: Walmart Fails To Explain Why
`1.
`A POSITA Would Ignore A Primary Teaching of Yang ......... 40
`Ground 1: Yang in view of Lynch ............................................ 41
`a) Walmart’s Proposed Modification Would Increase
`the Collapsed Volume of Yang ...................................... 41
`b) Walmart’s Expert Proposes a Different Modification
`Than Walmart ................................................................. 43
`Ground 2: Yang in view of the alleged AAPA ......................... 45
`Ground 3: Yang in view of Berg............................................... 49
`Grounds 4-7 Generally: Losi Teaches Away From Walmart’s
`Proposed Modifications To Its Parent Patent Tsai ................... 50
`Ground 4: Tsai in view of Lynch .............................................. 53
`Ground 5: Tsai in view of Alleged AAPA ............................... 54
`Grounds 6 and 7: Tsai in view of Berg (and Carter) ................ 55
`a) Walmart and Its Expert Propose Two Different
`Modifications of Tsai in View of Berg ........................... 55
`A POSITA Would Not Have Been Motivated
`to Make Either Modification to Tsai .............................. 58
`VII. THE CITED REFERENCES ARE DUPLICATIVE OF THOSE
`CONSIDERED BY THE EXAMINER ........................................................ 61
`The Cited References Were Either Considered By Or Are Cumulative
`A.
`Of Other References Considered By The Examiner ........................... 62
`B. Walmart Omits The Disclosure Of Losi To Allege Material
`Error By The Examiner ....................................................................... 70
`C. Walmart’s Expert’s Declaration Fails To Meaningfully
`Supplement The Record ...................................................................... 72
`VIII. THE MERE EXISTENCE OF WALMART’S EXPERT’S
`DECLARATION DOES NOT DEMAND INSTITUTION ......................... 73
`IX. THE BOARD SHOULD DENY INSTITUTION DUE TO WALMART’S
`EXCESSIVE AND INSUFFICIENTLY PLED GROUNDS ....................... 74
`CONCLUSION .............................................................................................. 75
`
`
`X.
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`
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`Exhibit
`No.
`
`2001
`
`2002
`
`2003
`
`2004
`
`2005
`
`2006
`
`2007
`
`2008
`2009
`
`2010
`
`2011
`
`EXHIBIT LIST
`
`Description
`Caravan Canopy Int’l, Inc. v. Home Depot U.S.A., et al., No.
`SACV 19-01072, Order Consolidating Cases, dated
`December 13, 2019
`Caravan Canopy Int’l, Inc. v. Costco Wholesale Corporation, et
`al., No. SACV 19-01072, Scheduling Order, dated January 27,
`2020
`Caravan Canopy Int’l, Inc. v. Walmart Inc., et al., No. 19-06978
`Consolidated with 19-01072, Walmart’s Memorandum in Support
`of its Motion to Stay Litigation Pending Inter Partes Review,
`dated June 18, 2020
`Caravan Canopy Int’l, Inc. v. Lowe’s Home Centers, LLC et al.,
`No. 19-06952 Consolidated with 19-01072, Request for
`Clarification re Stay of Litigation, dated August 26, 2020
`Caravan Canopy Int’l, Inc. v. Home Depot U.S.A., Inc., et al.,
`No. SACV 19-01072, Order Denying Defendants’ Request for
`Clarification, dated August 28, 2020
`Claim Chart for Walmart’s Ozark Trial Canopy, dated December
`9, 2019
`Caravan Canopy Int’l, Inc. v. Walmart Inc., et al., No. 19-06978
`Consolidated with 19-01072, Defendant Walmart Inc.’s
`Preliminary Invalidity Contentions, dated March 16, 2020
`Walmart’s Initial Invalidity Contentions Claim Chart – Ex. D
`Walmart’s Initial Invalidity Contentions Claim Chart – Ex. A
`Caravan Canopy Int’l, Inc. v. Costco Wholesale Corporation, et
`al., No. 19-01072, Costco Wholesale Corporation’s Invalidity
`Contentions and Accompanying Document Production, dated
`November 4, 2019
`Caravan Canopy Int’l, Inc. v. Z-Shade Co. LTD., et al., No.
`19-06224, Z-Shade Co., LTD.’s Invalidity Contentions and
`Accompanying Document Production, dated November 4, 2019
`
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`Exhibit
`No.
`
`2012
`
`2013
`
`2014
`2015
`2016
`2017
`2018
`2019
`2020
`2021
`
`
`
`
`112162522.8
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`
`Description
`Caravan Canopy Int’l, Inc. v. Shelterlogic Corp., et al., No.
`19-01224 Consolidated with 19-01072, Invalidity Contentions of
`Shelterlogic Corp., dated January 21, 2020
`Caravan Canopy Int’l, Inc. v. Lowe’s Home Centers, LLC et al.,
`No. 19-06952, Lowe’s Invalidity Contentions and Accompanying
`Document Production, dated November 4, 2019
`Declaration of Lance Rake
`U.S. Patent No. 5,701,923 to Losi, Jr. et al.
`U.S. Patent No. 5,275,188 to Tsai
`U.S. Patent No. 5,421,356 to Lynch
`U.S. Patent No. 5,634,483 to Gwin
`U.S. Patent No. 5,794,640 to Jang
`U.S. Patent No. 4,641,676 to Lynch
`U.S. Patent No. 4,607,656 to Carter
`
`
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`TABLE OF AUTHORITIES
`
` Page(s)
`
`Cases
`Advanced Bionics, LLC v. MED-EL Elektromedizinische Geräte
`GmbH,
`IPR2019-01469, Paper 6 (Feb. 13, 2020) ..................................................... 62, 70
`Alarm.com Inc. v. Vivint, Inc.,
`IPR2015-01967, Paper 12 (Mar. 30, 2016) ........................................................ 72
`Apple Inc. v. Achates Reference Publ’g, Inc.,
`IPR2013-00080, Paper 22 (June 3, 2013) ............................................................. 6
`Apple Inc. v. Fintiv, Inc.,
`IPR2020-00019, Paper 11 (March 20, 2020) ..............................................passim
`Apple Inc. v. Fintiv, Inc.,
`IPR2020-00019, Paper 15 (May 13, 2020) ..................................................... 8, 11
`Belden Inc v. Berk-Tek LLC,
`805 F.3d 1064 (Fed. Cir. 2015) .......................................................................... 44
`BSP Software LLC v. Motio, Inc.,
`IPR2013-00307, Paper 10 (Nov. 29, 2013) ........................................................ 17
`Cipla Ltd. v. Abraxis Bioscience, LLC,
`IPR2018-00163, Paper 12 (July 12, 2018) ......................................................... 73
`Cisco Sys., Inc. v. Ramot At Tel Aviv University Ltd.,
`IPR2020-00122, Paper 15 (May 15, 2020) ........................................................... 7
`Complete Genomics, Inc. v. Illumina Cambridge Ltd.,
`IPR2017-02174, Paper 22 (Aug. 2, 2018) .......................................................... 73
`Deeper, UAB v. Vexilar, Inc.,
`IPR2018-01310, Paper 7 (Jan. 24, 2019) ...................................................... 74, 75
`Facebook, Inc. v. Uniloc USA, Inc., et al.,
`IPR2017-01524, Paper 7 (Dec. 4, 2017)................................................. 55, 56, 58
`
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`FedEx Corp. v. Flectere LLC,
`IPR2020-00403, Paper 8 (June 26, 2020) ..................................................... 17, 34
`Freebit AS v. Bose Corp.,
`IPR2017-01309, Paper 8 (Nov. 8, 2017) ...................................................... 26, 29
`General Plastic Industrial Co., Ltd. v. Canon Kabushiki Kaisha,
`IPR2016-01357, Paper 9 (Sept. 6, 2017) .......................................................... 3, 6
`Harmonic Inc. v. Avid Tech., Inc.,
`815 F.3d 1356 (Fed. Cir. 2016) ............................................................................ 3
`Hulu, LLC v. Sound View Innovations, LLC,
`IPR2018-00582, Paper 34 (Aug. 5, 2019) .......................................................... 44
`InfoBionic, Inc. v. Braemar Mfg., LLC,
`IPR2015-01704, Paper 11 (Feb. 16, 2016) ................................................... 30, 48
`Johns Manville Corp. v. Knauf Insulation, Inc., et al.,
`IPR2018-00827, Paper 9 (Oct. 16, 2018) ........................................................... 17
`In re Kahn,
`441 F.3d 977 (Fed. Cir. 2006) ............................................................................ 17
`KSR Int’l Co. v. Teleflex Inc.,
`550 U.S. 398 (2007) ...................................................................................... 23, 25
`In re Magnum Oil Tools Int’l, Ltd.,
`829 F.3d 1364 (Fed. Cir. 2016) .......................................................................... 17
`Next Caller Inc. v. TRUSTID, Inc.,
`IPR2019-00961, Paper 10 (Oct. 16, 2019) ......................................................... 10
`NHK Spring Co. v. Intri-Plex Techs, Inc.,
`IPR2018-00752, Paper 8 (Sept. 12, 2018) ............................................................ 3
`Nokia of America Corp. v. Blackberry Ltd.,
`IPR2018-00583, Paper 13 (Oct. 19, 2018) ......................................................... 73
`R.J. Reynolds Vapor Co. v. Fontem Holdings 1 B.V.,
`IPR2017-01642, Paper 10 (Jan. 16, 2018) .......................................................... 66
`
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`In re Ratti,
`270 F.2d 810 (CCPA 1959) ................................................................................ 45
`Sand Revolution II, LLC v. Continental Intermodal Group – Trucking
`LLC,
`IPR2019-01393, Paper 24 (June 16, 2020) ........................................................... 8
`SAS Inst. Inc. v. Iancu,
`138 S. Ct. 1348 (2018) ........................................................................................ 74
`United Microelectronics Corp. v. Lone Star Silicon Innovations LLC,
`IPR2017-01513, Paper 10 (May 22, 2018) ......................................................... 73
`Valve Corp. v. Elec. Scripting Prods., Inc.,
`IPR2019-00062, Paper 11 (Apr. 11, 2019) ..................................................... 6, 14
`W.L. Gore & Assoc., Inc. v. Garlock, Inc.,
`721 F.2d 1540 (Fed. Cir. 1983) .......................................................................... 49
`Statutes
`35 U.S.C. § 314(a) ............................................................................... 3, 4, 14, 15, 16
`35 U.S.C. § 315(e)(2) ........................................................................................... 5, 15
`35 U.S.C. § 325(d) ......................................................................................... 4, 14, 61
`Other Authorities
`37 C.F.R. § 42.104(b)(4)-(5) .................................................................................... 55
`37 C.F.R. § 42.65(a) ........................................................................................... 33, 48
`37 C.F.R. § 42.108(c) ......................................................................................... 73, 74
`85 Fed. Reg. 31,728 (May 27, 2020) ....................................................................... 74
`Future Challenges that Could Be Denied for Statutory Reasons (June
`5, 2018) available at
`https://www.uspto.gov/sites/default/files/documents/%20sas_qas_2
`0180605.pdf ........................................................................................................ 74
`MPEP § 2143.01(VI) ............................................................................................... 45
`
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`I.
`
`INTRODUCTION
`Patent Owner Caravan Canopy International, Inc. (“Caravan”) submits its
`
`Preliminary Response to the Petition (Paper 1, “Petition” or “Pet.”) for Inter Partes
`
`Review of U.S. Patent No. 5,944,040 (the “’040 Patent”) filed by Walmart Inc.
`
`(“Walmart”). This submission is timely as it is within three months of the June 18,
`
`2020, mailing date of the Notice of Filing Date Accorded to Petition (Paper 3).
`
`Caravan respectfully submits that Walmart’s Petition should be denied for at
`
`least the following reasons:
`
`1) Walmart, the sole Petitioner, is one of five defendants in related
`
`consolidated litigation involving the ’040 Patent. The district court has stayed the
`
`litigation between Caravan and Walmart but has expressly declined to stay three of
`
`the other four related litigations and the remaining defendant has not sought a stay.
`
`Thus, four litigations involving the ’040 Patent are proceeding in parallel with this
`
`matter and, if a trial is instituted, are scheduled to conclude well before any final
`
`written decision would be expected;
`
`2)
`
`Even if a trial is instituted and the ’040 Patent upheld, Caravan will face
`
`substantially the same art and arguments from the other four defendants at the district
`
`court, which does not allay concerns about inefficiency and duplication of efforts
`
`and puts Caravan in a manifestly unfair position; and
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`3) Walmart’s seven grounds of unpatentability repackage cumulative
`
`references, such as Tsai, which is simply a less complete version of its continuation-
`
`in-part Losi that was considered in allowing the ’040 Patent, and reassert the same
`
`deficient motivations to combine the references leaving Walmart with no reasonable
`
`likelihood of success as to any of its asserted grounds.
`
`II. BACKGROUND
`The ’040 Patent discloses a collapsible tent frame that “is easily and quickly
`
`stretchable or collapsible” and provides “an enlarged and heightened interior space
`
`to users.” (Ex. 1001, 1:9-10, 3:4-6). The ’040 Patent states that:
`
`When the tent is pitched with the frame being fully stretched as
`described above, the center pole 50 moves upwardly along with the
`center pole ribs 30, so the tent frame of this invention heightens the
`interior space of the tent in comparison with a typical collapsible tent
`frame. Therefore, the tent frame of this invention allows users to freely
`go out of, come into or stand in the tent without being concerned about
`bumping one's head against the center pole ribs 30 or the center pole
`50.
`(Id., 3:29-37). The ’040 Patent concludes by stating:
`
`When the frame is stretched so as to pitch a tent, the center pole
`is fully moved upwardly along with the center pole ribs. The tent frame
`thus heightens the interior space of the tent in comparison with a typical
`collapsible tent frame and allows users to freely go out of, come into or
`stand in the tent without being concerned about bumping one's head
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`against the center pole ribs or the center pole. The collapsible tent
`frame of this invention is thus convenient to users.
`(Id., 4:12-19).
`
`III. THE BOARD SHOULD EXERCISE ITS STATUTORY DISCRETION
`AND DENY INSTITUTION
`The Board retains discretion whether to institute a trial. See 35 U.S.C. §
`
`314(a) (authorizing, but not requiring, institution of a trial under certain
`
`circumstances); Harmonic Inc. v. Avid Tech., Inc., 815 F.3d 1356, 1367 (Fed. Cir.
`
`2016) (“First of all, the PTO is permitted, but never compelled, to institute an IPR
`
`proceeding.”). In NHK Spring Co. v. Intri-Plex Techs, Inc., IPR2018-00752, Paper
`
`8, *20 (Sept. 12, 2018) (precedential), the Board declined to institute trial invoking
`
`its discretion under § 314(a) based on the “advanced state” of related district court
`
`litigation involving overlapping issues because instituting trial would be inconsistent
`
`with “an objective of the AIA ... to provide an effective and efficient alternative to
`
`district court litigation.” (emphasis added) (quoting General Plastic Industrial Co.,
`
`Ltd. v. Canon Kabushiki Kaisha, IPR2016-01357, Paper 9, *16-17 (Sept. 6, 2017)
`
`(precedential as to § II.B.4.i)).
`
`As a threshold matter, the Board generally considers exercising its statutory
`
`authority under § 314(a) “where the district court has set a trial date to occur earlier
`
`than the Board’s deadline to issue a final written decision in an instituted
`
`proceeding.” Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 11, *3 (March 20,
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`2020) (precedential) (“Apple”). In Apple, the Board set forth six non-dispositive
`
`factors to be considered when determining whether to exercise its discretion under
`
`§ 314(a):
`
`2.
`
`3.
`4.
`
`1. whether the court granted a stay or evidence exists that one may
`be granted if a proceeding is instituted;
`proximity of the court’s trial date to the Board’s projected
`statutory deadline for a final written decision;
`investment in the parallel proceeding by the court and the parties;
`overlap between issues raised in the petition and in the parallel
`proceeding;
`5. whether the petitioner and the defendant in the parallel
`proceeding are the same party; and
`other circumstances that impact the Board’s exercise of
`discretion, including the merits.
`
`6.
`
`Id., *6.
`
`In addition, “[o]ther facts and circumstances may also impact the Board’s
`
`discretion to deny institution,” such as “considerations implicated by 35 U.S.C. §
`
`325(d).” Id., *16. In short, the Apple factors “relate to whether efficiency, fairness,
`
`and the merits support the exercise of authority to deny institution in view of an
`
`earlier trial date in the parallel proceeding.” Id., *6.
`
`A. The Co-Pending Related Litigations
`Caravan is presently involved in litigation against five defendants, Walmart
`
`being one, regarding infringement of the ’040 Patent. In view of the similarities in
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`these matters, the district court consolidated these cases into lead case SACV 19-
`
`01072 on December 13, 2019, “for all pretrial purposes appropriate for these cases.”
`
`(Ex. 2001, p.1). In spite of this consolidation and the similar art and arguments
`
`asserted against the ’040 Patent by the defendants, Walmart filed the instant Petition
`
`alone and on its own accord. (Pet., p.84).
`
`When Walmart filed its Petition on June 1, 2020, the parties had exchanged
`
`preliminary invalidity and infringement contentions, completed claim construction
`
`discovery, and submitted opening claim construction briefs to the district court.
`
`(Pet., pp.27-28; Ex. 2002). On June 18, 2020, Walmart filed a motion to stay its
`
`individual litigation with Caravan, case CV 19-06978. (Ex. 2003).
`
`On June 23, 2020, in spite of Walmart’s Petition and its pending motion to
`
`stay, the court issued a detailed, 21-page claim construction order applicable to all
`
`defendants. (Ex. 1018). On August 19, 2020, the court granted Walmart’s motion
`
`to stay only its individual litigation with Caravan pending the outcome of this
`
`proceeding. (Ex. 1019). Three of the four non-stayed defendants attempted to
`
`bootstrap themselves to Walmart’s stay (Ex. 2004), which the district court expressly
`
`denied (Ex. 2005).
`
`Taken together, the defendants’ conduct reveals an apparent attempt to have
`
`Walmart test certain invalidity arguments before the Board by this IPR. Even if
`
`Walmart is unsuccessful and later estopped by § 315(e)(2), the other defendants
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`would glean valuable insights from this proceeding to revise and refashion their own
`
`invalidity arguments at the district court, allowing the other defendants to pick up
`
`Walmart’s torch. See Apple Inc. v. Achates Reference Publ’g, Inc., IPR2013-00080,
`
`Paper 22, *20 (June 3, 2013) (“The scenario Patent Owner describes – where one
`
`defendant in a case files a petition for inter partes review and is later estopped after
`
`a final decision in the review, but the other defendants do not file or join the petition
`
`and are not estopped – is certainly possible under the statute.”). Defendants’
`
`gamesmanship puts Caravan in a fundamentally unfair position. See Valve Corp. v.
`
`Elec. Scripting Prods., Inc., IPR2019-00062, Paper 11, *13 (Apr. 2, 2019)
`
`(precedential) (finding a similarly situated party’s “use of the Board’s institution
`
`decision ... as a roadmap ... implicates the fairness concerns discussed in General
`
`Plastic and favors denying institution.”).
`
`The Apple Factors Favor Denial
`B.
`Caravan respectfully submits that the Board should exercise its discretion and
`
`dismiss Walmart’s Petition. The co-pending related litigations–which involve the
`
`same claims and substantially the same art and arguments—are expected to conclude
`
`six months before the Board would be expected to issue any final written decision
`
`in this proceeding. Further, Walmart’s grounds of unpatentability are seriously
`
`flawed and recycle art either considered by or cumulative of art considered by the
`
`examiner in allowing the ’040 Patent.
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`Existence of a Stay (Apple Factor 1)
`1.
`The court granted a stay as to only the Caravan/Walmart litigation. (Ex. 1019,
`
`p.6). Three of the other four defendants attempted to bootstrap themselves to the
`
`Caravan/Walmart stay, but the court rejected their attempt. (Exs. 2004, 2005). Thus,
`
`Apple factor 1 favors denial as four of the five co-pending related litigations are not
`
`stayed and the district court has expressly declined to stay three of the five co-
`
`pending related litigations.
`
`Trial Timing (Apple Factor 2)
`2.
`Trial in the co-pending related litigations is scheduled to begin on June 8,
`
`
`
`2021. (Ex. 2002). The Board is not expected to issue a final written decision in this
`
`proceeding until December 2021—six months after the scheduled trial date. The
`
`Board has found that trial scheduled to begin six months before “the projected
`
`statutory deadline for the Board’s final decision ... weigh[ed] in favor of
`
`discretionary denial.” Cisco Sys., Inc. v. Ramot At Tel Aviv University Ltd.,
`
`IPR2020-00122, Paper 15, *8 (May 15, 2020). Thus, Apple factor 2 favors denial.
`
`Investment in the Parallel Proceedings (Apple Factor 3)
`3.
`The Board views claim construction orders as a benchmark event in parallel
`
`litigation tipping this factor toward denial. Apple, *9-10 (“[D]istrict court claim
`
`construction orders may indicate that the court and parties have invested sufficient
`
`time in the parallel proceeding to favor denial.”). Here, the district court issued its
`
`claim construction order (Ex. 1018) after the filing of, and with knowledge of,
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`Walmart’s Petition. The court’s significant investment of time and resources in its
`
`detailed 21-page claim construction order construing six claim terms—none of
`
`which correspond to Walmart’s proposed constructions in this proceeding—further
`
`tips this factor toward discretionary denial. Compare Apple Inc. v. Fintiv, Inc.,
`
`IPR2020-00019, Paper 15, *14 (May 13, 2020) (informative) (“Apple 15”) (finding
`
`that the district court’s “detailed 34-page claim construction order construing seven
`
`claims terms” favored denial) with Sand Revolution II, LLC v. Continental
`
`Intermodal Group – Trucking LLC, IPR2019-01393, Paper 24, *10-11 (June 16,
`
`2020) (informative) (comparing “the district court’s two-page Markman Order” with
`
`the “detailed Markman Order in [Apple 15]”).
`
`Moreover, the parties have exchanged initial infringement and invalidity
`
`contentions, including detailed claim charts addressing many of the same references
`
`cited in the Petition. See Section III(B)(5), infra. The extent to which the parties in
`
`the co-pending related litigations have proceeded toward trial is similar to that in
`
`Apple and thus favors denial. Apple 15, *14 (finding that “this factor weighs
`
`somewhat in favor of discretionary denial” even though “fact discovery is in its early
`
`stages, with document production ongoing and depositions just getting underway,
`
`expert reports are not yet due, and substantive motion practice is yet to come”).
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`Petition Timing (Apple Factor 3 Continued)
`4.
`The Board has held that if “the petitioner did not file the petition
`
`expeditiously, ... or even if the petitioner cannot explain the delay in filing its
`
`petition, these facts have favored denial.” Apple, *11-12. Rather than file its Petition
`
`expeditiously, Walmart waited six months after receiving Caravan’s initial
`
`infringement contentions (Ex. 2006) and two and a half months after serving its
`
`initial invalidity contentions (Ex. 2007) to file its Petition. Further, Walmart’s initial
`
`invalidity contentions involve the same art and at least substantially the same
`
`arguments as its Petition as shown below:
`
`Walmart’s Grounds of
`Unpatentability
`
`Yang + Lynch
`
`Yang + alleged AAPA
`
`Yang + Berg
`
`Tsai + Lynch
`
`Walmart’s Initial Invalidity Contentions
`(Ex. 2007, pp.7-8)
`Ex. 2008, pp.3-4 (citing the apex portion 50 of
`
`Lynch as the recited “center pole”)
`
`Id., p.8 (referring to the center pole 6 of the
`
`’040 Patent)
`
`Id., p.7 (citing the center pole 16 of Berg as
`
`the recited “center pole”)
`
`Ex. 2009, p.4 (citing the apex portion 50 of
`
`Lynch as the recited “center pole”)
`
`
`112162522.8
`
`
`-9-
`
`

`

`Tsai + alleged AAPA
`
`Id., p.9 (referring to the center pole 6 of the
`
`’040 Patent)
`
`Tsai + Berg (+ Carter)1
`
`Id., pp.7-8 (citing the center pole 16 of Berg as
`
`the recited “center pole”)
`
`
`
`Walmart simply did not act “expeditiously” in filing its Petition. See Next
`
`Caller Inc. v. TRUSTID, Inc., IPR2019-00961, Paper 10, *15-16 (Oct. 16, 2019)
`
`(finding that the petitioner’s approximately two month delay between serving its
`
`initial invalidity contentions and the filing of its petition “favor[ed] denying
`
`institution under § 314”).
`
`Walmart appears to have strategically delayed filing its Petition to glean
`
`Caravan’s claim construction positions, which it prematurely countered in its
`
`Petition. (Pet., pp.31-32 (“Patent Owner’s proposed construction is incorrect
`
`because...” and “The Board should reject Patent Owner’s unduly broad
`
`construction....”)). Thus, Apple factor 3 favors denial.
`
`5. Overlap in Issues (Apple Factor 4)
`“[I]f the petition includes the same or substantially the same claims, grounds,
`
`arguments, and evidence as presented in the parallel proceeding, this fact has favored
`
`denial.” Apple, *12.
`
`
`1 Grounds 6 and 7 are identical to claim 1. (Pet., p.79).
`
`
`112162522.8
`
`
`-10-
`
`

`

`The ’040 Patent has three claims, all of which are asserted against each of the
`
`defendants, all of which Walmart challenges in its Petition, and all of which will be
`
`litigated in the co-pending related litigations.
`
`
`
`The defendants in the four non-stayed co-pending related litigations have
`
`raised the same art in many of the same combinations as Walmart advances in its
`
`Petition. The first table below shows the substantial overlap in art raised by Walmart
`
`in its Petition and art raised by the other defendants, and the second table below
`
`shows the overlap in combinations of references raised by Walmart in its Petition
`
`and combinations advanced by the other defendants. Only art and combinations
`
`thereof that directly correspond to Walmart’s Petition are shown in the below tables.
`
`See Apple 15, *15 (“Petitioner’s assertion of additional invalidity contentions in the
`
`District Court is not relevant to the question of the degree of overlap for this factor.”).
`
`Walmart’s
`
`Asserted Art
`
`(Pet., p.8)
`
`Costco’s
`
`Z-Shade’s
`
`Asserted Art
`
`Asserted
`
`(Ex. 2010,
`
`Art (Ex.
`
`p.4)
`
`2011, p.4)
`
`ShelterLogic’s
`
`Lowe’s
`
`Asserted Art
`
`Asserted Art
`
`(Ex. 2012, p.2)
`
`(Ex. 2013, p.4)
`
`Yang
`
`Tsai
`
`Lynch
`
`X
`
`X
`
`X
`
`
`112162522.8
`
`
`X
`
`X
`
`X
`
`-11-
`
`
`
`X
`
`X
`
`X
`
`X
`
`X
`
`

`

`Alleged
`
`AAPA
`
`Berg
`
`Carter
`
`
`
`
`
`X
`
`X
`
`
`
`X
`
`X
`
`
`
`
`
`
`
`
`
`X
`
`X
`
`Costco’s
`
`Z-Shade’s
`
`Walmart’s
`
`Invalidity
`
`Invalidity
`
`Grounds of
`
`Arguments
`
`Arguments
`
`Unpatentability
`
`(Ex. 2010,
`
`(Ex. 2011,
`
`p.6)
`
`p.6)
`
`ShelterLogic’s
`
`Invalidity
`
`Arguments
`
`(Ex. 2012, p.2)
`
`Lowe’s
`
`Invalidity
`
`Arguments
`
`(Ex. 2013,
`
`pp.5-6)
`
`
`
`
`
`
`
`X
`
`
`
`X
`
`
`
`X
`
`X
`
`
`
`Yang + Lynch
`
`Yang + alleged
`
`AAPA
`
`Yang + Berg
`
`Tsai + Lynch
`
`Tsai + alleged
`
`AAPA
`
`X
`
`
`
`X
`
`X
`
`
`
`
`112162522.8
`
`
`X
`
`
`
`X
`
`X
`
`
`
`-12-
`
`

`

`Tsai + Berg (+
`
`Carter)2
`
`
`
`
`
`
`
`
`
`As can be seen, the other defendants cite the same primary references as Walmart
`
`(Yang and Tsai) and two of the three secondary references (Lynch and Berg) to argue
`
`invalidity of claim 1, meaning substantially the same art and arguments will be
`
`argued in this proceeding as will be concurrently litigated in the district court, raising
`
`the specter of conflicting decisions. Apple, *12 (finding “concerns of inefficiency
`
`and the possibility of conflicting decisions [to be] particularly strong.”). Thus, Apple
`
`factor 4 favors denial.
`
`6. Whether the Parties are the Same (Apple Factor 5)
`Generally, when a petitioner is unrelated to a defendant in a district court
`
`litigation, the Board weighs this factor against exercising its discretion. Apple, *13.
`
`But “[e]ven when a petitioner is unrelated to a defendant, ... if the issues are the same
`
`as, or substantially similar to, those already or about to be litigated, ... the Board
`
`may, nonetheless, exercise the authority to deny institution.” Id., *14.
`
`Here, the defendants in the co-pending related litigations are not party to
`
`Walmart’s Petition but are “similarly situated” to Walmart at least because the
`
`district court found them sufficiently related to be consolidated as co-defendants “for
`
`
`2 Grounds 6 and 7 are identical to claim 1. (Pet., p.79).
`
`
`112162522.8
`
`
`-13-
`
`

`

`all pretrial purposes.” (Ex. 2001, p.1); see Valve Corp., IPR2019-00062, Paper 11,
`
`*9-11. Further, as discussed above with respect to Apple factor 4, the other
`
`defendants have raised and will litigate issues that are the same or at least
`
`substantially similar to those raised by Walmart in its Petition. Thus, Apple factor 5
`
`favors denial.
`
`7. Other Circumstances (Apple Factor 6)
`“[T]he factors considered in the exercise of discretion are part of a balanced
`
`assessment of all the relevant circumstances in the case, including the merits.”
`
`Apple, *14. Further, “[o]ther facts and circumstances may also impact the Board’s
`
`discretion to deny institution,” such as facts and circumstances that would impact
`
`the “efficiency and integrity of the patent system” and “considerations implicated by
`
`... § 325(d).” Id., *16.
`
`Strength of the Merits
`a)
`As discussed in Section VI, infra, each of Walmart’s grounds of
`
`unpatentability suffers deficiencies sufficient to deny institution as failing to meet
`
`the statutory requirements of