UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`GOOGLELLC,
`
`Petitioner
`
`Vv.
`
`NEONODE SMARTPHONE LLC,
`
`Patent Owner
`
`Case IPR2021-01041
`
`US. Patent No. 8,095,879
`
`DECLARATION OF MARCUS BACKLUND
`
`0;
`
`Google v. Neonode
`IPR2021-01041 (US 8,095,879)
`Neonode Ex. 2009 - Page 1
`
`Google v. Neonode
`IPR2021-01041 (US 8,095,879)
`Neonode Ex. 2009 - Page 1
`
`
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`GOOGLELLC,
`
`Petitioner
`
`Vv.
`
`NEONODE SMARTPHONE LLC,
`
`Patent Owner
`
`Case IPR2021-01041
`
`US. Patent No. 8,095,879
`
`DECLARATION OF MARCUS BACKLUND
`
`0;
`
`Google v. Neonode
`IPR2021-01041 (US 8,095,879)
`Neonode Ex. 2009 - Page 1
`
`Google v. Neonode
`IPR2021-01041 (US 8,095,879)
`Neonode Ex. 2009 - Page 1
`
`
`
`Declaration of Marcus Backlund
`IPR2021-01041
`
`1.
`
`2.
`
`I, Marcus Backlund, declare as follows:
`
`I am over 18 years of age and, if I am called upon to do so, I would be
`
`competent to do testify as to the matters set forth herein.
`
`3.
`
` Inlate 2003, I began meeting with Magnus Goertz and Thomas
`
`Eriksson about the prospect ofinvesting in a business they hadestablished to bring
`
`a new type of mobile handset to the market. The name ofthe company was
`
`Neonode AB. In my meetings with them, they showed mea fully-functioning
`
`model of the mobile handset that was released as the Neonode N1. And they
`
`demonstrated the touch screen user interface that they had developed to operate the
`
`NI, including the swipe to unlock, swipe to answeracall, and tap-activatable
`
`icons
`
`4.
`
`In our meetings, they told us how they had developed the user
`
`interface with its novel swipe and tap gesturesfirst, but found that the resistive and
`
`capacitive touch screen technology at that time was unsatisfactory. They told me
`
`that Magnusinvented a new optical touch screen technology called zForce to
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`implementthe hand-gesture-based user interface that he had previously developed.
`
`5.
`
`Atthe time, in 2003, the major mobile handset manufacturers were
`
`Nokia, Motorola, Samsung, LG-Electronics, and Siemens. Their high-end
`
`handsetsall had screens, but not touch screens. Instead, the user interacted with
`
`these handsets using mechanical buttons and keyboards. Apple would not
`
`1
`
`Wb
`
`Google v. Neonode
`IPR2021-01041 (US 8,095,879)
`Neonode Ex. 2009 - Page 2
`
`Google v. Neonode
`IPR2021-01041 (US 8,095,879)
`Neonode Ex. 2009 - Page 2
`
`
`
`Declaration of Marcus Backlund
`IPR2021-01041
`
`announce the first iPhone, which dispensed with most external mechanical buttons
`
`and relied on a touch-sensitive screen and gesture-based user interface, until early
`
`2007.
`
`6.|When Magnus and Thomas demonstrated the N1 mobile handset to
`
`me in 2003, I believed that the gesture-based user interface, substantially without
`
`mechanical buttons, was revolutionary. Magnus had developed an interface with a
`
`natural swipe movementthat would enable a user to navigate the device easily
`
`using a thumb to swipe up or down,right or left. The functionality ofthe handset
`
`was awesome, and the gesture-based user interface was far ahead ofits time.
`
`7.
`
`In around May 2004, after performing due diligence, I became an
`
`investor in Neonode andat about the same time I became Chief Executive Officer
`
`of the company and served in that capacity until around October 2005. In
`
`connection with my investment, a new entity was established named Neonode
`
`Sweden AB,whichlater changed its name to Neonode AB.
`
`8.
`
` Neonode’sinitial business model was to offer the N1 on-line. To the
`
`best of my recollection, the handset was offered at a price, in euros andlocal
`
`currency, equivalent to approximately $1000 US dollars. This was approximately
`
`five times the price ofother high-end handsets offered by Nokia and other handset
`
`manufacturers. Nevertheless, the initial response from the consumer market was
`
`Me
`
`Google v. Neonode
`IPR2021-01041 (US 8,095,879)
`Neonode Ex. 2009 - Page 3
`
`Google v. Neonode
`IPR2021-01041 (US 8,095,879)
`Neonode Ex. 2009 - Page 3
`
`
`
`Declaration of Marcus Backlund
`IPR2021-01041
`
`spectacular; the phone had what would later be characterized as iPhone-type
`
`attention queues.
`
`9.
`
`To the best of my recollection, Neonode had over 100,000 Internet
`
`pre-orders, over 300 N1 units per day, which required the customer to pay a
`
`substantial down paymentto secure the customer’s place on the handset’s waitmg
`
`list. These pre-orders were in addition to the over 20,000 pre-orders Neonode
`
`received following its initial brand release in December 2002.
`
`10.
`
`In addition, Neonode was contacted by a large number of companies
`
`that expressed interest in purchasing the N1. In the commercial phase ofthe N1’s-
`
`release, Neonode received substantial pre-orders from network operators around
`
`the world.
`
`11.
`
`In myobservation as CEO of Neonode, the excitement in the market
`
`about the N1 handset was dueto its revolutionary swiping gesture user interface.
`
`This was the principal user-facing differentiator of the N1 from all other mobile
`
`handsets then on the market. This gesture-based user interface was far ahead ofits
`
`time in one ofthe largest industries.
`
`12. Neonode’s gesture-based user interface encountered skepticism from
`
`other established companies in the mobile handset industry. I personally met with
`
`representatives ofNokia, Samsung and Ericsson, and although they were
`
`impressed with the swiping-gesture user interface, they were skeptical that
`
`3
`
`Ib
`
`Google v. Neonode
`IPR2021-01041 (US 8,095,879)
`Neonode Ex. 2009 - Page 4
`
`Google v. Neonode
`IPR2021-01041 (US 8,095,879)
`Neonode Ex. 2009 - Page 4
`
`
`
`Declaration of Marcus Backlund
`IPR2021-01041
`
`consumers would want a keyboard-less mobile handset. They told us that the
`
`touch screen might get greasy from users’ fingers performing gestures, thereby
`
`obscuring the user interface. And they told us they thought that users were used to
`
`buttons to navigate mobile phones and would be hesitant to accept one without
`
`them.
`
`13.
`
`Samsung’s management was extremely impressed by the Neonode
`
`N1,andin early 2005 began discussions with us aboutlicensing the N1°s gesture-
`
`based user interface and touch screen technology. Samsung’s representatives
`
`expressed a great deal ofinterest in licensing Neonode’s gesture-based user
`
`interface technology. We had many hours ofmeetings with Samsung, and I went
`
`at least once to Seoul, South Korea, to meet with Samsung representatives to
`
`negotiate the terms of a license agreement.
`
`14.
`
`In July 2005, I, on behalf of Neonode, signed this license agreement
`
`with Samsung.
`
`15. Although Neonodeultimately did not succeed as a company, this fact
`
`was not in any wayattributable to its revolutionary user interface. Rather, we
`
`learned that there are substantial barriers to entry in the mobile handset
`
`manufacturing market. Some of Neonode’s contractors had never built a mobile
`
`handset before, and they struggled to get manufacturing up to scale to meet the
`
`demand from consumers and network providers. Quality control was also an issue
`
`4
`
`IPR2021-01041 (US 8,095,879)
`Neonode Ex. 2009 - Page 5
`
`Google v. Neonode
`IPR2021-01041 (US 8,095,879)
`Neonode Ex. 2009 - Page 5
`
`
`
`Declaration of Marcus Backlund
`IPR2021-01041
`
`initially. This led to an insufficient inventory ofproductsto fill the growing
`
`demandfor the N1 andits successor, the N2. Shifting network operator
`
`specifications, which Neonode had to meet to sell mobile handsets to operators,
`
`required engineering new features into Neonode’s phones. Neonode was working
`
`successfully toward resolving these initial barriers to entry, but the financial crisis
`
`following the collapse of Lehman Brothers, and its devastating impact on capital
`
`lending and investment, led ultimately to the company’sfailure in 2008.
`
`16.
`
`JIamnolongeran officer ofor major investor in Neonode. If
`
`Neonode wereto receive a substantial recovery in this case, that would have no
`
`material impact on my net worth.
`
`17.
`
`I declare under penalty ofperjury under the laws ofthe United States
`
`ofAmerica that the foregoing is true and correct, that all statements made herein of
`
`my knowledgeare true, andthat all statements made on information andbelief are
`
`believed to be true, to the best ofmy recollection, and that these statements were
`
`made with the knowledgethat willful false statements and the like so made are
`
`punishable by fine or imprisonment, or both, under Section 1001 of Title 18 of the
`
`United States Code.
`
` Dated: Oct, 7, 2OLZ/
`
`Marcus Backlund
`
`Google v. Neonode
`IPR2021-01041 (US 8,095,879)
`Neonode Ex. 2009 - Page 6
`
`Google v. Neonode
`IPR2021-01041 (US 8,095,879)
`Neonode Ex. 2009 - Page 6
`
`
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