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`UNITED STATES PATENT AND TRADEMARK OFFICE
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`APPLE INC.,
`Petitioner
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`v.
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`KOSS CORPORATION,
`Patent Owner
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`Case IPR2021-00592
`Patent 10,469,934
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`PETITIONER’S OPPOSITION TO PATENT OWNER’S MOTION FOR
`ADDITIONAL DISCOVERY
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`INTRODUCTION ........................................................................................... 2
`BACKGROUND ............................................................................................. 2
` ADDITIONAL DISCOVERY IS NOT WARRANTED ................................ 3
`A.
`The Garmin Factors Support Denial ..................................................... 3
`1.
`Factor 1 – KOSS Has Not Presented More Than a “Mere
`Allegation” That Something Useful Will be Discovered ........... 4
`Factor 2 – KOSS’ Request for Additional Discovery Seeks
`Litigation Positions ..................................................................... 8
`The remaining Garmin Factors Weigh Against Authorizing
`Additional Discovery .................................................................. 9
`Granting Additional Discovery Undermines Limited Discovery in IPR
`Proceedings ......................................................................................... 10
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`2.
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`3.
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`B.
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`Case IPR2021-00592
`Attorney Docket No: 50095-0018IP1
`TABLE OF CONTENTS
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`1
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`Case IPR2021-00592
`Attorney Docket No: 50095-0018IP1
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`INTRODUCTION
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`KOSS’s motion for additional discovery (“Motion”) seeks leave to use
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`Apple’s confidential sales information of Apple AirPods (1st Generation), AirPods
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`(2nd Generation), AirPods Pro (collectively, “Apple Products”) to purportedly
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`support secondary considerations of non-obviousness. But this request for
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`additional discovery does not serve “the interests of justice” since KOSS fails to
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`establish that something useful will be discovered. 37 C.F.R. § 42.51(b)(2).
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`KOSS also does not provide sufficient evidence of nexus between the Apple
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`Products and the Challenged Claims. Instead, to support its allegations of nexus,
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`KOSS primarily cites to its preliminary infringement contentions—a litigation
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`filing that, if alone found to be sufficient to warrant additional discovery, would
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`erode the narrowly tailored requirements for additional discovery in IPR
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`proceedings. Further, according to KOSS, the publicly available information cited
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`within the Motion is sufficient for its allegations of purported commercial success,
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`thereby making its request for additional discovery unnecessary. The Motion
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`should therefore be denied.
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` BACKGROUND
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`Apple and KOSS are involved in several IPR proceedings involving five
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`patents that KOSS asserted against Apple in KOSS Corporation v. Apple Inc.,
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`6:2020cv00665 (W.D.Tex.). The Board has instituted five IPR proceedings
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`2
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`Case IPR2021-00592
`Attorney Docket No: 50095-0018IP1
`(IPR2021-00255, IPR2021-00305, IPR2021-00381, IPR2021-00592, IPR2021-
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`00600), denied institution of four IPR proceedings (IPR2021-00546, IPR2021-
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`00626, IPR2021-00679, IPR2021-00686), and one IPR proceeding is pending
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`institution (IPR2021-00693).
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`The Board denied KOSS’s requests for authorization to file motions for
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`additional discovery in IPR2021-00255, IPR2021-00305, IPR2021-00381 due to
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`the requests being untimely. See IPR2021-00255, Pap. 21 (PTAB Sept. 1, 2021).
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`KOSS then filed motions for additional discovery in six IPR proceedings—
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`IPR2021-00592, IPR2021-00600, IPR2021-00626, IPR2021-00693, IPR2021-
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`00686, IPR2021-00679. KOSS makes essentially the same arguments in each
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`motion and seeks discovery of sales revenue and quantity of units sold, by calendar
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`quarter, for certain Apple products since the commercial introduction of each
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`product. See, e.g. KOSS-2030. KOSS states that it requests this additional
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`discovery to “seek[] evidence for proving commercial success of the Challenged
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`Claims, which is relevant to assessing obviousness of the Challenged Claims under
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`35 U.S.C. § 103.” Mot., 6.
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` ADDITIONAL DISCOVERY IS NOT WARRANTED
`A. The Garmin Factors Support Denial
`To assess whether a party seeking additional discovery in an IPR proceeding
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`has sufficiently demonstrated that “such additional discovery is in the interests of
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`3
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`justice[,]” the Board considers five factors provided in Garmin International, Inc.
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`v. Cuozzo Speed Technologies LLC, IPR2012-00001 (Mar. 5, 2013) (Pap. 26); 37
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`C.F.R. § 42.51(b)(2)(i).
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`1.
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`Factor 1 – KOSS Has Not Presented More Than a “Mere
`Allegation” That Something Useful Will be Discovered
`To satisfy the usefulness prong of Garmin Factor 1, KOSS is required to
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`demonstrate that the requested discovery is not “merely ‘relevant’ or ‘admissible,’
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`but rather [is] favorable in substantive value to a contention of the party moving
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`for discovery.” 33Across, Inc. v. LeftsNRights, Inc., IPR2018-01480, Pap. 24, at 4-
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`5 (PTAB May 7, 2019) (citation omitted).
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`KOSS advances four allegations to support its request for additional
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`discovery based on this factor: (1) Koss argues that publicly available evidence
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`shows that Apple allegedly exploited the Challenged Claims through sales of
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`Apple Products, (2) Koss contends that there is a “clear” nexus between the Apple
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`Products and the Challenged Claims, (3) Koss alleges that the Apple Products
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`“need to practice” the Challenged Claims, and (4) Koss contends that the fact that
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`Apple could introduce the Apple Products years after the priority dates of the
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`challenged patents is “strong evidence of nonobviousness.” Mot., 8-11. Yet, the
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`sales information that KOSS requests—sales revenue and quantity of units sold of
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`Apple Products—is product-level information that has no substantive value to any
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`of KOSS’s four allegations. KOSS’ statement that Apple “exploited” the
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`Challenged Claims through sales of Apple Products is unsubstantiated because
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`KOSS has not provided any evidence of copying within the Apple Products.
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`KOSS’s second statement of a “clear” nexus between the Apple Products
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`and the Challenged Claims is conclusory and fails to support its additional
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`discovery request with sufficient evidence of nexus. IPR2017-00928, Pap. 24, 6
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`(PTAB Oct. 25, 2017) (“Absent some evidence of nexus, Patent Owner cannot
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`demonstrate that its discovery requests are likely to uncover something useful”);
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`see IPR2018-01480, Pap. 24, 7 (PTAB May 7, 2019) (“There must be some
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`showing of nexus to ensure that additional discovery is necessary in the interest or
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`justice.”). KOSS cites primarily to its district court preliminary infringement
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`contentions to support its allegations of nexus between the Apple Products and the
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`Challenged Claims. See Mot., 5, 9-10. But this is insufficient for the requisite
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`showing of nexus since preliminary infringement contentions constitute mere
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`allegations, not proof, of infringement. Indeed, preliminary infringement
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`contentions are not evidentiary in nature since their primary purpose is to provide
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`notice to a defendant to understand a plaintiff’s infringement theories.
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`The Board has also routinely denied requests for additional discovery that
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`failed to satisfy the threshold amount of evidence or reasoning requirement of
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`Garmin. See, e.g., IPR2020-01405, Pap. 30, 5 (PTAB Apr. 23, 2021 (denying
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`motion because “assertions of infringement and coextensiveness do not go far
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`enough”); PGR2017-00012, Pap. 37, 8-9 (PTAB Sep. 27, 2017) (finding that
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`Garmin Factor 1 weights against permitting additional discovery since Patent
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`Owner had not shown a reason to expect that requested discovery will lead to
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`useful information).
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`Moreover, comparisons to other exemplary motions for additional discovery
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`that the Board previously granted further confirm that KOSS’s motion fails to
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`establish the requisite showing of nexus to support additional discovery of the
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`requested sales information. In Kolbe, the Board authorized additional discovery
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`of sales/financial information since it found that moving party provided sufficient
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`support by including an element-by-element claim chart and supporting expert
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`witness declaration testimony averring that all claim elements of the challenged
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`claims are present in products and that the unique elements of the patented product
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`are responsible for the industry demand for the products. IPR2019-00933, Pap. 33,
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`11-13 (PTAB Dec. 30, 2019). In Telebrands, the Board authorized additional
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`discovery of sales information based on evidence of copying through emails
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`between Petitioner and its designer/manufacturer containing reference to Patent
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`Owner’s product, which the Board found tended to “show that Petitioner’s product
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`is a virtually-identical replica of Patent Owner’s product.” PGR2015-00018, Pap.
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`31, 4-7 (PTAB Apr. 4, 2016). Unlike Kolbe and Telebrands, KOSS has not
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`supported its request for additional discovery with any expert testimony addressing
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`correspondence between the Apple Products and the Challenged Claims, evidence
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`of copying in the Apple Products, or a showing that the unique elements of the
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`patent claims, if embodied, are responsible for any industry demand.
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`Similarly, in Shure, the Board authorized additional discovery of sales
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`information based on findings by the district court that the product “will likely be
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`found to infringe” a related patent with the same elements as the challenged patent.
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`IPR2017-01785, Pap. 31, 3-5 (PTAB Jun. 4, 2018). There, the Board cited to the
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`district court’s decision denying a motion for preliminary injunction by the Patent
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`Owner and noted that “[t]he District Court determined that ‘the [Patent Owner] had
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`the better arguments on claim construction, infringement, and harm[]” and “‘[i]f
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`not for the validity problem, then the preliminary injunction would have issued.’”
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`Id. (citation omitted). Unlike Shure, however, the district court of the counterpart
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`litigation has not issued any determinations relating to or suggestive of
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`infringement of the Challenged Claims by the Apple Products.
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`Finally, Koss’s contentions the Apple Products “need to practice” the
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`Challenged Claims and that the fact that Apple could introduce the Apple Products
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`years after the priority dates of the challenged patents is “strong evidence of
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`nonobviousness” lack any merit. Even if additional discovery were granted, the
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`requested sales information would not substantiate these contentions. The
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`information would not provide any proof that “the sales were a direct result of
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`unique characteristics of the claimed invention—as opposed to other economic and
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`commercial factors unrelated to the quality of the patented subject matter.” See In
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`re Huang, 100 F.3d 135, 140 (Fed. Cir. 1996). Koss asks for mere sales/financial
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`information. While KOSS alleges that “there is a presumptive nexus between the
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`AirPods Products and the Challenged Claims” (Mot., 10), the requested sales
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`information would not provide any indication as to whether the Apple Products
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`both embody claimed features and are coextensive with the Challenged Claims.
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`See SightSound Techs., LLC v. Apple Inc., 809 F.3d 1307, 1319 (Fed. Cir. 2015).
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`Finally, the requested sales information lacks any technical detail that would
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`substantiate KOSS’ allegation that the Apple Products “need to practice” the
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`Challenged Claims. See Mot., 10.
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`Garmin Factor 1 therefore does not support authorizing additional discovery.
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`2.
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`Factor 2 – KOSS’ Request for Additional Discovery Seeks
`Litigation Positions
`KOSS’s focus on Apple Products—without specific analysis of the unique
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`features that produced their sales—suggests that KOSS’s attempts to use additional
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`discovery in these IPR proceedings to impermissibly suggest infringement. See
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`IPR2018-01480, Pap. 24, 9 (denying request for discovery related to Petitioner’s
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`products because Patent Owner did “not explain adequately why such discovery
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`requests are appropriate in this inter partes review that determines the patentability
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`of the challenged claims, not infringement”).
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`The remaining Garmin Factors Weigh Against Authorizing
`Additional Discovery
`The remaining Garmin factors further weigh against authorizing KOSS’
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`3.
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`requested discovery. With respect to Garmin Factor 3, KOSS admits that
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`“publicly available information provides more than a threshold showing that
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`Petitioner’s AirPods Products have been commercially successful.” Mot., 2
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`(emphasis added). Using this information, KOSS estimates sales of “224 million
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`units” for the Apple Products and “more [than] [sic] $35 billion in sales in four
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`years.” Id., 2 (emphasis in original). According to KOSS, the public information
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`is sufficient for its allegations of commercial success of the Apple Products, and
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`thus, KOSS’s request for additional discovery is unnecessarily cumulative over
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`information already in its possession.
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`The additional discovery is also burdensome with respect to Garmin Factors
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`4 and 5. KOSS broadly requests “[s]ales revenue and quantity of units sold, by
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`calendar quarter, for AirPods (1st & 2nd gen) and AirPods Pro since the
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`commercial introduction of those products[,]” which seeks financial information
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`regarding three products and encompass global sales made before the ’934 patent
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`issued. Mot., 1. This goes well beyond the discovery produced in the district court
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`litigation, further demonstrating that the discovery is not as limited and readily-
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`available as KOSS suggests.
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`9
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`B. Granting Additional Discovery Undermines Limited Discovery in
`IPR Proceedings
`The Board should also deny the Motion since authorizing additional
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`discovery of sales information here effectively creates precedent for similarly-
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`situated patentees to abuse additional discovery in IPR proceedings by relying
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`primarily on preliminary infringement contentions to satisfy the requisite showing
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`of nexus to be granted additional discovery.
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`Here, KOSS filed its motions for additional discovery in September 2021—
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`several months after filing POPRs and after serving preliminary infringement
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`contentions in November 2020. Because this timing is virtually present in all IPR
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`proceedings that reach this stage, if the Board authorizes additional discovery in
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`this proceeding, then granting KOSS’s motion for additional discovery here will
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`inevitably provide a path for patentees to seek additional discovery, thereby
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`eroding the narrowly tailored requirements for additional discovery in IPR
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`proceedings under 37 C.F.R. § 42.51(b)(2) and 35 U.S.C. § 316(a)(5).
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`10
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`Date:10/18/2021
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`(Trial No. IPR2021-00592)
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`Case IPR2021-00592
`Attorney Docket No: 50095-0018IP1
`Respectfully submitted,
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`/W. Karl Renner/
`W. Karl Renner, Reg. No. 41,265
`Roberto Devoto, Reg. No. 55,108
`David Holt, Reg. No. 65,161
`Fish & Richardson P.C.
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`Attorneys for Petitioner
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`11
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`Case IPR2021-00592
`Attorney Docket No: 50095-0018IP1
`CERTIFICATE OF SERVICE
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`Pursuant to 37 CFR § 42.6(e)(4), the undersigned certifies that on October
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`18, 2021, a complete and entire copy of this PETITIONER’S OPPOSITION TO
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`PATENT OWNER’S MOTION FOR ADDITIONAL DISCOVERY were
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`provided via email to the Patent Owner by serving the correspondence email
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`addresses of record as follows:
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`Mark G. Knedeisen
`Laurén S. Murray
`Brian P. Bozzo
`K&L Gates LLP
`K&L Gates Center
`210 Sixth Avenue
`Pittsburgh, PA 15222
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`Email: mark.knedeisen@klgates.com
`Email: lauren.murray@klgates.com
`Email: brian.bozzo@klgates.com
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`/Crena Pacheco/
`Crena Pacheco
`Fish & Richardson P.C.
`3200 RBC Plaza
`60 South Sixth Street
`Minneapolis, MN 55402
`(617) 956-5938
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