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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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`SAMSUNG ELECTRONICS CO. LTD., SAMSUNG ELECTRONICS
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`AMERICA, INC. AND APPLE, INC.,
`
`Petitioners
`
`v.
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`NEONODE SMARTPHONE LLC,
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`Patent Owner
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`____________
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`Case IPR2021-00145
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`U.S. Patent No. 8,812,993
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`
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`
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`PATENT OWNER’S OPPOSITION TO SAMSUNG ELECTRONICS CO.
`LTD AND SAMSUNG ELECTRONICS AMERICA, INC.’S MOTION TO
`EXCLUDE EVIDENCE PURSUANT TO 37 C.F.R. § 42.64(c)
`
`
`005079-19/1806197 V2
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`
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`IPR2021-00145
`Opposition to Motion to Exclude Evidence
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`TABLE OF CONTENTS
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`Page
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`
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`I.
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`SAMSUNG’S OBJECTIONS ......................................................................... 1
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`A.
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`B.
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`Samsung’s Motion is Procedurally Deficient ....................................... 1
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`Purportedly Inadmissible Expert Testimony: Exhibit
`2015 – Declaration of Per Bystedt ........................................................ 1
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`C.
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`Purported Hearsay ................................................................................. 5
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`1.
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`2.
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`Exhibit 2015 – Declaration of Per Bystedt ................................. 5
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`Exhibit 2016 – Declaration of Marcus Bäcklund ....................... 7
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`II.
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`CONCLUSION ................................................................................................ 8
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`IPR2021-00145
`Opposition to Motion to Exclude Evidence
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`TABLE OF AUTHORITIES
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`Page(s)
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`CASES
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`Corning Inc. v. DSM IP Assets B.V.,
`IPR2013-00050, Paper #77 ................................................................................... 1
`
`Drew v. Equifax Info. Servs., LLC,
`690 F.3d 1100 (9th Cir. 2012) .......................................................................... 6, 8
`
`Lightning Lube, Inc. v. Witco Corp.,
`4 F.3d 1153 (3d Cir. 1993) ................................................................................... 4
`
`Omega Patents, LLC v. CalAmp Corp.,
`920 F.3d 1337 (Fed. Cir. 2019) .................................................................... 2, 5, 8
`
`Securitron Magnalock Corp. v. Schnabolk,
`65 F.3d 256 (2d Cir. 1995), cert. denied, 516 U.S. 1114, 116 S.Ct.
`916, 133 L.Ed.2d 846 (1996) ................................................................................ 5
`
`OTHER AUTHORITIES
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`Fed. R. Evid. 701 ............................................................................................... 2, 3, 4
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`Fed. R. Evid. 702 ....................................................................................................... 1
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`Fed. R. Evid. 801 ............................................................................................... 5, 6, 8
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`IPR2021-00145
`Opposition to Motion to Exclude Evidence
`
`
`I.
`
`SAMSUNG’S OBJECTIONS
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`A.
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`Samsung’s Motion is Procedurally Deficient
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`Samsung fails to identify properly the evidence it seeks to exclude. It
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`broadly asserts that various paragraphs of the declarations of Mr. Bystedt and Mr.
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`Bäcklund contain or constitute objectionable material, and then identifies
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`“examples” of objectionable testimony. Samsung’s objections, as framed,
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`therefore fail to identify all of the content objected to with sufficient specificity to
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`enable a response. The Board should address Samsung’s objections and motion as
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`encompassing only those specific statements identified in this motion. Corning
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`Inc. v. DSM IP Assets B.V., IPR2013-00050, Paper #77, p. 50 (“DSM lists several
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`paragraphs from Dr. Winningham’s Petition Declaration as ‘example[s]’ of
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`evidence it seeks to exclude. . . . We will not engage in guesswork, or scour the
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`record, to determine what other evidence falls within this category.”).
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`B.
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`Purportedly Inadmissible Expert Testimony: Exhibit 2015 –
`Declaration of Per Bystedt
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`Samsung asks that the Board exclude references in paragraph 3 of the
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`Bystedt declaration to the Neonode N1 smartphone as “innovative” and “novel.”
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`The purported basis is that the cited testimony is opinion testimony outside the
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`bounds of Rule 702 of the Federal Rules of Evidence. The Board should reject
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`Samsung’s argument.
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`IPR2021-00145
`Opposition to Motion to Exclude Evidence
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`Mr. Bystedt’s references in paragraph 3 to the N1 device as “innovative” and
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`“novel” are not inadmissible expert opinion testimony. Neonode did not proffer
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`these statements on the ultimate issue of whether the ‘993 Patent claims are in fact
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`“novel” within the meaning of the Patent Code, but rather to demonstrate the
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`existence of industry praise for the gesture-based interface of the Neonode N1 and
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`N2 smartphones that incorporated the patented functionality. Paper #29, p. 64.
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`Mr. Bystedt’s observation that the almost button-less design of the Neonode
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`phones and their gesture-based interface were innovative and novel in 2002 is
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`pertinent to the existence and focus of industry praise. The focus of Mr. Bystedt’s
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`testimony is not on whether the Neonode phones were in fact novel or innovative,
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`but rather that they were perceived to be so by the Swedish technology and
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`business community at the time.1 This is not an inadmissible expert opinion
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`requiring specialized knowledge; rather, it is lay testimony requiring nothing more
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`than what is required by Rule 701. Omega Patents, LLC v. CalAmp Corp., 920
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`F.3d 1337, 1352 (Fed. Cir. 2019) (holding that district court abused its discretion in
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`excluding testimony regarding lay witness’s investigation into whether claims
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`
`1 Patent Owner did cite to a portion of paragraph 3 in support of its showing that
`the Hisatomi reference is not prior art. Paper #29, p. 14. However, this citation is
`to a portion of paragraph 3 concerning Neonode’s presentation of a prototype
`phone at the March 2002 CeBIT trade show, which does not contain the challenged
`“novel” or “innovative” language.
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`IPR2021-00145
`Opposition to Motion to Exclude Evidence
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`would be infringed and were valid, because the testimony was offered to show
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`defendant’s state of mind). As shown above, the testimony is helpful to
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`determining a fact in issue (the existence of industry praise), and is not simply a
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`baldly-stated opinion on the ultimate issue of novelty. And, Mr. Bystedt’s
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`testimony is rationally based on his perception, as it is based on articles that he
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`saw, demonstrations of the N1 phone, his own use of the N1 and N2 phones, tests
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`he conducted of novice users using the phone, his experience as an investor in and
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`CEO of the company, his weekly discussions with Samsung management and
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`Samsung’s own statement that Neonode’s intuitive user interface was “the future
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`of mobile phones.” EX2015, ¶¶3-4, 6-9. Mr. Bystedt elaborated in his deposition
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`on his reasons for believing the Neonode user interface was innovative. EX1055,
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`13:19 – 14:10, 15:4 – 17:18. So, the challenged testimony is permissible lay
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`opinion under Rule 701.
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`Moreover, in the event that the Board determines to grant Samsung’s motion
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`with respect to the challenged language (which it should not), it should simply
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`strike “innovative” and “novel” from paragraph 3 of Mr. Bystedt’s declaration
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`rather than excluding the entire paragraph, because Samsung only challenges the
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`inclusion of those words. Samsung proffers no basis on which to exclude any of
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`the remaining content of ¶3; accordingly, it should not be excluded.
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`IPR2021-00145
`Opposition to Motion to Exclude Evidence
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`Samsung also seeks exclusion of portions of paragraph 5 in which Mr.
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`Bystedt recounts statements made to him by Thomas Eriksson and Magnus Goertz
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`concerning the conception and development of the gesture-based user interface of
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`the Neonode N1 smartphone. However, these are not expressions of opinion at all;
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`rather, they recount statements made by third parties (Eriksson and Goertz).
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`Samsung next complains about the fact that Mr. Bystedt testified in
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`paragraph 11 of his declaration that Neonode enjoyed substantial commercial
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`success. Here again, Mr. Bystedt is not stating an opinion on the ultimate issue of
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`novelty, but rather on the subsidiary factual issue of whether the Neonode N1 and
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`N2 smartphones enjoyed commercial success. His opinion concerning the phones’
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`commercial success is clearly admissible. Mr. Bystedt was an investor in Neonode
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`from May 2004, and Chairman of the Board of Directors of the company from
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`August 2004 through October 2017. EX2015, ¶7. He was CEO of the company
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`from September 2005 to February 2007, and from May 2008 to January 2011. Id.
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`He testified from memory as to the company’s sales and preorders of N1 and N2
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`phones. EX2015, ¶11. He testified further on these issues at his deposition.
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`EX1055, 71:19 – 19:16, 24:12-16. He was clearly in a position to have knowledge
`
`of these facts and to form an opinion as to the success of his company’s product.
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`His testimony is admissible. Fed. R. Evid. 701; see Lightning Lube, Inc. v. Witco
`
`Corp., 4 F.3d 1153, 1175 (3d Cir. 1993) (allowing Rule 701 testimony by the
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`IPR2021-00145
`Opposition to Motion to Exclude Evidence
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`owner of a corporation as to the amount of lost profits); Securitron Magnalock
`
`Corp. v. Schnabolk, 65 F.3d 256, 265 (2d Cir. 1995) (“[A] president of a company,
`
`such as Cook, has ‘personal knowledge of his business ... sufficient to make ... him
`
`eligible under Rule 701 to testify as to how lost profits could be calculated.’ ”)
`
`(internal citations and quotation marks omitted), cert. denied, 516 U.S. 1114, 116
`
`S.Ct. 916, 133 L.Ed.2d 846 (1996).
`
`C.
`
`Purported Hearsay
`
`1.
`
`Exhibit 2015 – Declaration of Per Bystedt
`
`Samsung objects to testimony in paragraph 9 of Mr. Bystedt’s declaration
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`recounting statements made to him by a Samsung officer, Ki-Tai Lee, the then-
`
`head of Samsung’s mobile telecom division, as purportedly constituting hearsay.
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`This is not hearsay for two independent reasons.
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`First, Mr. Bystedt’s testimony on this point is not offered for the truth of the
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`matter asserted in Mr. Lee’s statement – i.e., that Neonode’s user interface was
`
`“the future of mobile phones,” or that Samsung “needed” the license to the
`
`Neonode patents that it later signed – but rather to demonstrate industry respect for
`
`the patented invention. Paper #29, pp. 66-67. It is therefore not hearsay. Fed. R.
`
`Evid. 801(c)(2); Omega Patents, 920 F.3d at 1352 (testimony regarding witness’s
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`understanding, based on defendant’s counsel’s oral opinion, of whether
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`defendant’s counsel believed defendant infringed the patent in suit was not
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`IPR2021-00145
`Opposition to Motion to Exclude Evidence
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`hearsay, because offered for the purpose of establishing the effect on the listener);
`
`Drew v. Equifax Info. Servs., LLC, 690 F.3d 1100, 1108 (9th Cir. 2012) (“‘If the
`
`significance of an offered statement lies solely in the fact that it was made ... the
`
`statement is not hearsay.’”), citing Gorman v. Wolpoff & Abramson, LLP, 584 F.3d
`
`1147, 1164 (9th Cir. 2009).
`
`Second, Mr. Bystedt’s testimony concerning Mr. Lee’s statements is not
`
`hearsay because Mr. Lee, the then-head of Samsung’s mobile telecom division,
`
`was an agent or employee of Samsung at the time. Samsung is one of the
`
`petitioners in this proceeding; indeed, it is Samsung that is seeking to exclude this
`
`testimony. Mr. Bystedt’s testimony on this point is therefore not hearsay. Fed. R.
`
`Evid. 801(d)(2)(D).
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`Samsung also objects that Mr. Bystedt “injects his own meaning into the
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`words,” characterizing what he saw and heard during his meetings with Mr. Lee
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`and other Samsung representatives. However, this does not state a basis for a
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`hearsay objection, and Samsung offers no other purported ground on which to
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`exclude Mr. Bystedt’s testimony in paragraph 9 of his declaration. In any event,
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`Mr. Bystedt clearly had a basis on which to form a belief as to whether Samsung’s
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`management were impressed with the Neonode phones and whether Mr. Lee was
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`referring to the user interface, as he testified to weekly calls with Samsung’s
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`management and many hours of meetings with Samsung representatives at which
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`- 6 -
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`IPR2021-00145
`Opposition to Motion to Exclude Evidence
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`these statements were made. EX2015, ¶¶8-9. Samsung had an opportunity to
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`depose Mr. Bystedt, and in fact did so, but asked no questions concerning these
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`meetings. EX1055. This testimony is admissible.
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`2.
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`Exhibit 2016 – Declaration of Marcus Bäcklund
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`Samsung objects to testimony in paragraph 12 of Marcus Bäcklund’s
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`declaration concerning industry skepticism regarding Neonode’s gesture-based
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`interface. Mr. Bäcklund testified that he:
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`personally met with representatives of Nokia, Samsung and Ericsson, and
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`although they were impressed with the swiping-gesture user interface, they
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`were skeptical that consumers would want a keyboard-less mobile handset.
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`They told us that the touch screen might get greasy from users' fingers
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`performing gestures, thereby obscuring the user interface. And they told us
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`they thought that users were used to buttons to navigate mobile phones and
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`would be hesitant to accept one without them.
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`EX2016, ¶12. Samsung contends that this is hearsay. It is not, because Patent
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`Owner does not offer it for the truth of the matter asserted in the statements
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`recounted by Mr. Bäcklund – i.e., that consumers would not want a keyboard-less
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`smartphone, that the touch screen might get greasy, and so on. Rather, Patent
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`Owner offers this testimony to demonstrate industry skepticism concerning the
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`patented invention, which is evidence of nonobviousness. Paper #29, pp. 65-66.
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`- 7 -
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`IPR2021-00145
`Opposition to Motion to Exclude Evidence
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`The significance of these statements of industry representatives is not in whether
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`they were true, but that in the fact that they were made. This testimony is,
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`therefore, not hearsay. Fed. R. Evid. 801(c)(2); Omega Patents, 920 F.3d at 1352;
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`Drew, 690 F.3d at 1108.
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`As it does with Mr. Bystedt, Samsung objects that Mr. Bäcklund “attributes
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`his own understanding” to what he heard from the Nokia, Samsung and Ericsson
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`representatives. Here again, this is not a basis for a hearsay objection. In any
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`event, Mr. Bäcklund clearly had a basis to form an understanding as to the
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`implications of what they were telling him, since he testified that he personally met
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`with them, and the understanding that their statements suggested skepticism from
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`established companies in the mobile handset industry flows naturally from who
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`they were and what they told him.
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`II. CONCLUSION
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`For the foregoing reasons, the Board should deny Samsung’s motion to
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`exclude.
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`Dated: March 2, 2022
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`Respectfully submitted,
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`IPR2021-00145
`Opposition to Motion to Exclude Evidence
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`
`
`/Philip J. Graves/
`Philip J. Graves (pro hac vice)
`philipg@hbsslaw.com
`HAGENS BERMAN SOBOL SHAPIRO LLP
`301 North Lake Avenue, Suite 920
`Pasadena, CA 91101-4129
`(213) 330-7150 (phone)
`(213) 330-7152 (fax)
`
`Robert M. Asher
`Reg. No. 30,445
`rasher@sunsteinlaw.com
`SUNSTEIN LLP
`100 High Street
`Boston, MA 02110-2321
`(617) 443-9292 (phone)
`(617) 443-0004 (fax)
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`- 9 -
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`IPR2021-00145
`Opposition to Motion to Exclude Evidence
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`CERTIFICATE OF SERVICE
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`It is certified that on March 2, 2022, the foregoing document has been served
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`on Petitioners as provided in 37 C.F.R. § 42.6(e) via electronic mail at IPR50095-
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`0015P1@fr.com.
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`Dated: March 2, 2022
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`Respectfully submitted,
`
`
`
`
`
`/William Stevens/
`HAGENS BERMAN SOBOL SHAPIRO LLP
`301 North Lake Avenue, Suite 920
`Pasadena, CA 91101-4129
`(213) 330-7150 (phone)
`(213) 330-7152 (fax)
`
`
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`- 10 -
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