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`IPR2022-00545
`U.S. Patent 9,689,161
`Reply to Patent Owner Response
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`
`
`
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`
`
`
`
`
`
`Chanel, Inc.,
`
`Petitioner,
`
`v.
`
`Molo Design, Ltd.,
`
`Patent Owner.
`
`Case IPR2022-00545
`U.S. Patent 9,689,161
`
`
`
`
`
`
`
`PETITIONER’S REPLY TO PATENT OWNER RESPONSE
`
`
`
`
`
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`
`
`

`

`IPR2022-00545
`U.S. Patent 9,689,161
`Reply to Patent Owner Response
`
`TABLE OF CONTENTS
`
`I.
`
`II.
`
`INTRODUCTION .................................................................................................... 1
`
`POSITA AND CLAIM CONSTRUCTION............................................................. 1
`
`III. MOLO’S OBJECTIVE INDICIA EVIDENCE SHOULD BE GIVEN
`MINIMAL WEIGHT ............................................................................................... 2
`
`A. No Presumption of Nexus Is Warranted ............................................... 2
`
`B. Molo Failed To Prove Actual Nexus .................................................... 5
`
`1.
`
`2.
`
`3.
`
`4.
`
`Industry praise ............................................................................. 6
`
`Commercial success .................................................................... 7
`
`Copying ..................................................................................... 10
`
`Long-felt need ........................................................................... 12
`
`IV.
`
`EVIDENCE OF UNPATENTABILITY ................................................................ 13
`
`A. Grounds 3-4 (SoftWall et al.; claims 1-10, 12, 14 and 18) ................. 13
`
`B.
`
`Grounds 1-2 (SoftHousing et al.; claims 1-10, 12, 14 and 18) ........... 15
`
`1.
`
`2.
`
`3.
`
`Chanel relied on SoftHousing images in the prior art ............... 15
`
`SoftHousing I discloses a “freestanding” wall .......................... 23
`
`Folding the ends of a SoftHousing wall into a tubular
`configuration was an obvious modification .............................. 27
`
`C.
`
`Ground 5 (MacAllen 2008 et al.; claims 19-25 and 27)...................... 29
`
`V.
`
`CONCLUSION ...................................................................................................... 32
`
`
`
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`
`i
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`IPR2022-00545
`U.S. Patent 9,689,161
`Reply to Patent Owner Response
`
`TABLE OF AUTHORITIES
`
` Page(s)
`
`Cases
`
`In re Applied Materials, Inc.,
`692 F.3d 1289 (Fed. Cir. 2012) ............................................................................ 9
`
`In re Ben Huang,
`100 F.3d 135 (Fed. Cir.1996) ............................................................................. 10
`
`Cable Elec. Prods., Inc. v. Genmark, Inc.,
`770 F.2d 1015 (Fed. Cir. 1985) .......................................................................... 10
`
`Canon, Inc. v. WSOU Investments, LLC,
`IPR2021-00965, Paper 25, 8-11 (PTAB Nov. 21, 2022) ..................................... 1
`
`DeSilva v. DiLeonardi,
`181 F.3d 865 (7th Cir. 1999) .............................................................................. 15
`
`Fox Factory, Inc. v. SRAM, LLC,
`944 F.3d 1366 (Fed. Cir. 2019) ................................................................ 2, 3, 4, 5
`
`Geo M. Martin Co. v. All. Mach. Sys. Int'l LLC,
`618 F.3d 1294 (Fed. Cir. 2010) .......................................................................... 13
`
`Google LLC, et al. v. Zipit Wireless, Inc.,
`IPR2019-01567, Paper 38, 32-34 (PTAB Mar. 9, 2021) ...................................... 3
`
`Intel Corp. v. PACT XPP Schweiz AG,
`No. 2022-1037, 2023 U.S. App. LEXIS 5854 (Fed. Cir. Mar. 13,
`2023) ................................................................................................................... 32
`
`Iron Grip Barbell Co. v. USA Sports, Inc.,
`392 F.3d 1317 (Fed. Cir. 2004) .......................................................................... 10
`
`In re Kahn,
`441 F.3d 977 (Fed. Cir. 2006) ............................................................................ 12
`
`In re Kao,
`639 F.3d 1057 (Fed. Cir. 2011) ...................................................................passim
`
`ii
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`

`

`IPR2022-00545
`U.S. Patent 9,689,161
`Reply to Patent Owner Response
`
`KSR Int’l Co. v. Teleflex Inc.,
`550 U.S. 398 (2007) ...................................................................................... 31, 32
`
`Meds. Co. v. Mylan Inc.,
`2014 U.S. Dist. LEXIS 38714 (N.D. Ill. Mar. 25, 2014) ..................................... 5
`
`Nike, Inc. v. Adidas AG,
`955 F.3d 45 (Fed. Cir. 2020) .............................................................................. 13
`
`Ormco Corp. v. Align Tech., Inc.,
`463 F.3d 1299 (Fed. Cir. 2006) ............................................................................ 8
`
`Polaris Indus., Inc. v. Artic Cat, Inc.,
`882 F.3d 1056 (Fed. Cir. 2018) ............................................................................ 5
`
`Red Diamond, Inc. v. Southern Visions, LLP,
`IPR2019-01671, Paper 35, 39-40 (PTAB Mar. 31, 2021) .................................. 10
`
`Samsung Elecs. Co., Ltd. v. Cellect, LLC,
`IPR2020-00476, Paper 14, 12-13 (July 31, 2020) ................................................ 1
`
`Tex. Instruments Inc. v. U.S. Int'l Trade Comm'n,
`988 F.2d 1165 (Fed. Cir. 1993) .......................................................................... 12
`
`Therasense, Inc. v. Becton, Dickinson & Co.,
`593 F.3d 1289 (Fed. Cir. 2010) ............................................................................ 4
`
`WBIP, LLC v. Kohler Co.,
`829 F.3d 1317 & 1330 (Fed. Cir. 2016) ............................................................... 5
`
`Wyers v. Master Lock Co.,
`616 F.3d 1231 (Fed. Cir. 2010) .......................................................................... 11
`
`ZUP, LLC v. Nash Mfg.,
`896 F.3d 1365 (Fed. Cir. 2018) .......................................................................... 13
`
`
`
`
`
`iii
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`

`

`IPR2022-00545
`U.S. Patent 9,689,161
`Reply to Patent Owner Response
`
`LIST OF EXHIBITS
`
`Exhibit
`1001
`1002
`1003
`1004
`1005
`1006
`
`1007
`1011
`1014
`
`1016
`
`1017
`
`1020
`
`1021
`
`1023
`1024
`1025
`
`1026
`1027
`1028
`
`Description
`U.S. Patent No. 7,866,366 (“’366”)
`File History of U.S. Patent No. 7,866,366
`Declaration of Lance Gordon Rake
`Affidavit of Duncan Hall (Internet Archive)
`DBEW, “Golden Prize” (“SoftHousing I”)
`DBEW, “Collection of Winning Works of DBEW International
`Design Competition,” Tianjin University Press, (“SoftHousing II”)
`Common Ground, “First Step Soft Housing” (“SoftHousing III”)
`JPS4987173A (Okuno 1974) (“Okuno”)
`Document titled “Soft Housing,” produced by Molo in related
`district court action [MOLO_00004200-4204]
`SoftHousing I and II references
`[PRIORART_00000768-0772; PRIORART_00000666-0675]
`Soft Housing reference published online at
`https://blog.naver.com/greensoul35/60007413333
`[PRIORART_00000831; PRIORART_00000779]
`DBEW, The 3rd DBEW International Design Competition, at 38-
`41, produced by Molo in related district court action
`[MOLO_00004196-4199]
`DBEW International Design Competition 2003 references
`[PRIORART_00000733; PRIORART_00000777-0778;
`PRIORART_00000775; PRIORART_00000682;
`PRIORART_00000679; PRIORART_00000765;
`PRIORART_00000774; PRIORART_00000767;
`PRIORART_00000773; PRIORART_00000766;
`PRIORART_00000810; PRIORART_00000794-0795]
`U.S. Patent No. 4,307,768 (Anderson 1981) (“Anderson”)
`JPH06299629 (Inayama 1994) and translation
`JPH0520204Y2 (Sankyo 1990) (“Sankyo”) with certified
`translation [PRIORART_00000798-0807]
`U.S. Patent No. 6,427,409 (Colson 2002)
`U.S. Patent No. 2,807,405A (Lambert 1957) (“Lambert”)
`Architectural Record, Vol. 192, No. 9, September, 2004
`(“SoftWall”) [excerpts from PRIORART_00000319]
`
`iv
`
`
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`

`

`IPR2022-00545
`U.S. Patent 9,689,161
`Reply to Patent Owner Response
`
`Exhibit
`1029
`
`1031
`1032
`1033
`
`1034
`
`1035
`
`1036
`
`1043
`
`1044
`
`1047
`1048
`
`1049
`
`1050
`
`1051
`1052
`1053
`1054
`1055
`1056
`1057
`1058
`1059
`1060
`
`Description
`Scheduling Order in Molo Design, Ltd. v. Chanel, Inc., No. 21-cv-
`1578 (S.D.N.Y.), dated April 22, 2021 (Dkt. 27)
`Lex Machina Report for S.D.N.Y.
`Declaration of Shannon Bjorklund
`U.S. Patent Appl. Pub. No. US2006/0260231A1 (“MacAllen”)
`[PRIORART_00000060-0069]
`U.S. Patent Appl. Pub. No. US2006/0082987A1 (“Dorsey”)
`[PRIORART_00000001-0019]
`U.S. Patent Appl. Pub. No. US/20070017172A1 (“Kennedy”)
`[PRIORART_00000239-0297]
`Molo’s Infringement Contentions in Molo Design, Ltd. v. Chanel,
`Inc., No. 21-cv-1578 (S.D.N.Y.), dated June 14, 2021 (excerpts)
`MacAllen Patent Application No, 12/343,042 filed on December
`23, 2008
`Office Action dated May 13, 2017 from the File History of U.S.
`Patent No. 9,797,134
`Affidavit of Nathaniel Frank-White (Internet Archive)
`Transcript of March 21, 2023 Deposition of Alan Ball (“Ball-
`Dep.”)
`Transcript of March 22, 2023 Deposition of Todd MacAllen
`(“MacAllen-Dep.”)
`Transcript of March 24, 2023 Deposition of Stephanie Forsythe
`(“Forsythe-Dep.”)
`Declaration of Miles Ladin, dated June 24, 2021
`Canadian Architect, “Lightouch for Forsythe and MacAllen”
`PDF of gp02-1.jpg, downloaded from archived DBEW website
`PDF of gp02-2.jpg, downloaded from archived DBEW website
`PDF of gp02-3.jpg, downloaded from archived DBEW website
`PDF of gp02-4.jpg, downloaded from archived DBEW website
`PDF of gp02-5.jpg, downloaded from archived DBEW website
`Higher resolution photo of book page from Exhibit 1006
`Higher resolution photo of book page from Exhibit 1006
`Higher resolution photo of book page from Exhibit 1006
`
`v
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`

`

`IPR2022-00545
`U.S. Patent 9,689,161
`Reply to Patent Owner Response
`
`I.
`
`INTRODUCTION
`
`The Petition established the Challenged Claims’ unpatentability over
`
`SoftHousing-based Grounds 1-2, SoftWall-based Grounds 3-4, and MacAllen 2008-
`
`based Ground 5. Molo’s objective indicia evidence lacks the required nexus with
`
`the Challenged Claims and does not overcome Chanel’s strong showing of
`
`obviousness. Infra §III. Molo’s other arguments fail for the reasons explained
`
`herein. Infra §IV.
`
`II.
`
`POSITA AND CLAIM CONSTRUCTION
`
`The parties agree on the POSITA and level of ordinary skill in the art. See
`
`Ex. 1003, ¶44; Ex. 2010, ¶34. Neither party proposed an express construction for
`
`any claim term. See Petition, 24-25; Patent Owner’s Response (“POR”), 19-22.
`
`Neither party objects to the Board’s construction of “freestanding” to mean
`
`“standing alone free of support or attachment.” Institution Decision (“ID”), 11;
`
`POR, 19-20.
`
`The Board previously rejected Molo’s argument regarding supposed
`
`inconsistent claim construction positions by Chanel, and should do so again in the
`
`final written decision. See ID, 8-10; Canon, Inc. v. WSOU Investments, LLC,
`
`IPR2021-00965, Paper 25, 8-11 (Nov. 21, 2022); Samsung Elecs. Co., Ltd. v.
`
`Cellect, LLC, IPR2020-00476, Paper 14, 12-13 (July 31, 2020).
`
`1
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`
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`

`

`IPR2022-00545
`U.S. Patent 9,689,161
`Reply to Patent Owner Response
`III. MOLO’S OBJECTIVE INDICIA EVIDENCE SHOULD BE GIVEN
`MINIMAL WEIGHT
`
`For Grounds 2, 4, and 5,1 Molo argues that objective indicia including
`
`industry praise, commercial success, copying, and long-felt need demonstrate the
`
`Challenged Claims were not obvious. POR, 58-72. In support, Molo presents
`
`evidence focused on its softwall + softblock products (“softwall”) available
`
`beginning in 2005. Id. This evidence should be given minimal weight because it
`
`lacks a nexus to the Challenged Claims and is deficient in other respects addressed
`
`below.
`
`A. No Presumption of Nexus Is Warranted
`
`A presumption of nexus is appropriate only if “the patentee shows that the
`
`asserted objective evidence is tied to a specific product and that product embodies
`
`the claimed features, and is coextensive with them.” Fox Factory, Inc. v. SRAM,
`
`LLC, 944 F.3d 1366, 1373 (Fed. Cir. 2019) (cleaned up). Molo has not made the
`
`required showing.
`
`Critically, Molo fails to address the coextensiveness requirement. Molo
`
`contends it is entitled to a presumption of nexus for evidence relating to softwall
`
`because softwall allegedly “practices the [Challenged Claims],” presenting a claim
`
`
`1 Objective indicia are not relevant to Grounds 1 and 3, which involve anticipation.
`
`2
`
`
`
`

`

`IPR2022-00545
`U.S. Patent 9,689,161
`Reply to Patent Owner Response
`
`chart purporting to show that softwall practices claim 2 of the ’161 patent. POR,
`
`59-63. However, Molo fails to address unclaimed features of softwall or to provide
`
`any analysis demonstrating that softwall is coextensive with the Challenged
`
`Claims. Nor does Molo compare softwall to any Challenged Claim besides claim
`
`2. Id.
`
`Molo’s failure to prove coextensiveness makes a presumption of nexus
`
`inappropriate. See Google LLC, et al. v. Zipit Wireless, Inc., IPR2019-01567, Paper
`
`38, 32-34 (PTAB Mar. 9, 2021). In essence, Molo attempts to reduce the
`
`coextensiveness requirement to an inquiry into whether a claim in the patent
`
`broadly covers the product that is the subject of the objective indicia evidence. The
`
`Federal Circuit has rejected this flawed approach. Fox Factory, 944 F.3d at 1376-
`
`77.2
`
`Moreover, a presumption of nexus is inappropriate here because softwall is,
`
`in fact, not coextensive with the Challenged Claims. Softwall includes key features
`
`that Molo claimed in other patents and omitted from the Challenged Claims of the
`
`
`2 Molo’s expert applied this same flawed approach and considered only whether
`
`certain Challenged Claims read on softwall. See Ball-Dep. 12:16-13:6; Ex. 2010,
`
`¶¶201-221.
`
`3
`
`
`
`

`

`IPR2022-00545
`U.S. Patent 9,689,161
`Reply to Patent Owner Response
`
`’161 patent, such as a pair supports at opposite ends of the core having particular
`
`properties (’366 patent), magnetic fasteners (’366 patent), and LED lighting (’666
`
`and ’134 patents). And Molo relies on softwall as an embodiment of these different
`
`inventions claimed in those patents. See IPR2022-00543, POR, 65-80; IPR2022-
`
`00544, POR, 30-43; IPR2022-00546, POR, 30-43; MacAllen-Dep. 78:19-24; Ball-
`
`Dep. 12:3-23, 17:21-25, 19:1-7. Indeed, the only softwall component commonly
`
`claimed in all four challenged patents is the expandable cellular core. That
`
`component was known in the prior art and does not establish a presumption of
`
`nexus. See In re Kao, 639 F.3d 1057, 1069 (Fed. Cir. 2011).
`
`Molo’s position that softwall embodies the claims of multiple patents
`
`reinforces that softwall is not coextensive with the Challenged Claims of the ’161
`
`patent. Notably, Molo cites the same evidence of industry praise, commercial
`
`success, copying, and long-felt need for softwall in four IPR proceedings
`
`concerning different patents directed to different features and combinations. See
`
`IPR2022-00543, POR, 71-80; IPR2022-00544, POR, 33-43; IPR2022-00545,
`
`POR, 63-72; IPR2022-00546, POR, 32-43. In so doing, Molo undermines its own
`
`argument for a presumption of nexus. See Fox Factory, 944 F.3d at 1378 (“The
`
`same evidence of secondary considerations cannot be presumed to be attributable
`
`to two different combinations of features.”); Therasense, Inc. v. Becton, Dickinson
`
`4
`
`
`
`

`

`IPR2022-00545
`U.S. Patent 9,689,161
`Reply to Patent Owner Response
`
`& Co., 593 F.3d 1289, 1299 (Fed. Cir. 2010) (no presumption of nexus because the
`
`“product embodied at least two patents.”); Meds. Co. v. Mylan Inc., 2014 U.S.
`
`Dist. LEXIS 38714, at *18-19 (N.D. Ill. Mar. 25, 2014).
`
`Accordingly, Molo has not met its burden to show that a presumption of
`
`nexus is warranted.3
`
`B. Molo Failed To Prove Actual Nexus
`
`When a presumption of nexus is not appropriate, the patentee may still
`
`attempt to prove actual nexus by showing that its objective indicia evidence is “the
`
`direct result of the unique characteristics of the claimed invention.” Fox Factory,
`
`944 F.3d at 1374 (cleaned up). For objective indicia evidence to carry substantial
`
`weight, however, “there must be a nexus to some aspect of the claim not already in
`
`the prior art.” In re Kao, 639 F.3d at 1069.
`
`As discussed below, Molo failed to establish actual nexus between its
`
`objective indicia evidence and any unique characteristic of the Challenged Claims.
`
`
`3 Molo’s cited cases are inapposite because both involved undisputed claims of
`
`coextensiveness. See WBIP, LLC v. Kohler Co., 829 F.3d 1317, 1329 n.3 & 1330
`
`n.4 (Fed. Cir. 2016); Polaris Indus., Inc. v. Artic Cat, Inc., 882 F.3d 1056, 1072-73
`
`(Fed. Cir. 2018).
`
`5
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`

`

`IPR2022-00545
`U.S. Patent 9,689,161
`Reply to Patent Owner Response
`
`Indeed, Molo’s expert did not even analyze nexus for several of the ’161
`
`Challenged Claims. See Ball-Dep. 37:1-14; Ex. 2010, ¶¶201-221. Molo’s weak
`
`objective indicia evidence does not overcome Chanel’s strong showing of
`
`obviousness.
`
`1.
`
`Industry praise
`
`Molo argues that industry awards and recognition for softwall proves the
`
`Challenged Claims were not obvious. POR, 63-64. This argument fails because
`
`Molo has not shown that industry praise for softwall was the direct result of unique
`
`characteristics of the Challenged Claims, as opposed to unclaimed features such as
`
`those claimed in other patents, aspects already in the prior art, aesthetic qualities,
`
`or marketing.
`
`Significantly, Molo relies on the same evidence of industry praise—
`
`primarily MoMA (Ex. 2019) and Index Award (Ex. 2020)—in IPR proceedings
`
`concerning four different patents directed to different features and combinations.
`
`See IPR2022-00543, POR, 71-72; IPR2022-00544, POR, 33-34; IPR2022-00545,
`
`POR, 63-64; IPR2022-00546, POR, 32-34. This shows that the industry praise
`
`evidence is not specific to the unique characteristics of the Challenged Claims of
`
`the ’161 patent. The only softwall component common to the claims of all four
`
`patents is the expandable cellular core known in the prior art. This is insufficient to
`
`establish actual nexus. Kao, 639 F.3d at 1069.
`
`6
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`

`

`IPR2022-00545
`U.S. Patent 9,689,161
`Reply to Patent Owner Response
`
`Molo’s industry praise argument for the ’161 patent is especially lacking in
`
`nexus because the main examples of praise highlighted in Molo’s brief (MoMA
`
`and Index Award) involved softwalls that did not have key elements of the ’161
`
`Challenged Claims, such as vertical supports positioned within voids of the core
`
`(claims 19-25 and 27). See MacAllen-Dep. 59:21-24, 61:5-8.
`
`2.
`
`Commercial success
`
`Molo argues that softwall has been commercially successful, and that this
`
`proves the Challenged Claims were not obvious. POR, 65-69. As evidence of
`
`commercial success, Molo relies on an email purporting to summarize “Molo’s
`
`Gross Sales attributable to Softwalls/Softblocks” from FY2005-FY2022 (Ex.
`
`2021). This argument and evidence is flawed.
`
`First, there is no actual nexus between these sales attributed to softwall and
`
`the unique characteristics of the Challenged Claims of the ’161 patent. This is
`
`highlighted by the fact that Molo relies on the same sales data to argue commercial
`
`success in IPR proceedings concerning four different patents directed to different
`
`features and combinations. See IPR2022-00543, POR, 77; IPR2022-00544, POR,
`
`40; IPR2022-00545, POR, 69; IPR2022-00546, POR, 39-40. Molo makes no effort
`
`to apportion its sales between the different patented inventions that softwall
`
`allegedly embodies. Molo’s witnesses were unable to identify any sales for
`
`softwalls having key elements of certain ’161 Challenged Claims, such as vertical
`
`7
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`
`
`

`

`IPR2022-00545
`U.S. Patent 9,689,161
`Reply to Patent Owner Response
`
`supports positioned within voids of the core (claims 19-25 and 27). See Ball-Dep.
`
`36:21-37:14; MacAllen-Dep. 76:5-77:1. Thus, Molo has not met its burden to
`
`show actual nexus for its commercial success evidence.
`
`Molo also fails to show that softwall sales were the direct result of the
`
`claimed invention as opposed to features known in the prior art, such as the
`
`expandable cellular core. See Ormco Corp. v. Align Tech., Inc., 463 F.3d 1299,
`
`1312 (Fed. Cir. 2006) (“[I]f the feature that creates the commercial success was
`
`known in the prior art, the success is not pertinent.”); In re Kao, 639 F.3d at 1070.
`
`Indeed, Exhibit 2029 shows one of Molo’s early customers expressing enthusiasm
`
`for a prior art softwall prototype.4 See Ex. 2029, 1 (“In May 2004, at The
`
`International Contemporary Furniture Fair (ICFF) in New York, USA, I met
`
`Stephanie Forsythe of MOLO DESIGN, LTD. (“MOLO”) and expressed my
`
`enthusiasm for the very innovative design of softwall with its unique and gentle
`
`visual expression. I told her that I would like to be the first to purchase these
`
`softwalls, but she told me this was a prototype softwall that was not ready for
`
`sale.”). Exhibit 2029 provides a clear example of a customer who purchased
`
`
`4 The softwall prototype was publicly displayed at ICFF on May 16, 2004. Ex.
`
`1051.
`
`8
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`

`

`IPR2022-00545
`U.S. Patent 9,689,161
`Reply to Patent Owner Response
`
`softwall because of features in the prior art. See id. (“In December 2004, I for COR
`
`purchased eight units of softwall with wool endings. Even without seeing the
`
`completed design I was sure that this type of new developed softwall would look
`
`as great as the ones I saw at the Fair in New York.”) (emphasis added).
`
`Beyond the lack of nexus, Molo’s sales evidence is also insufficient to
`
`establish that softwall was commercially successful. Molo’s Exhibit 2021 is an
`
`unverified internal email that allegedly reports gross sales for an undefined group
`
`of products, with no product skus, units sold, or other information that might
`
`enable one to evaluate the claim that these sales are “attributable to
`
`Softwalls/Softblocks.” See Ball-Dep. 31:16-32:14; MacAllen-Dep. 63:11-21,
`
`68:24-69:2, 69:14-70:14. Molo also fails to disclose net sales, expenses, or profits,
`
`or any information regarding softwall’s market share, despite acknowledging that
`
`other companies have sold similar products. See MacAllen-Dep. 78:7-18; Ball-
`
`Dep. 39:6-8; Forsythe-Dep. 36:4-37:13. Thus, there is insufficient evidence to
`
`conclude that gross annual sales averaging ~$2.8M CAD constitutes a commercial
`
`success.
`
`Numerous decisions have recognized that without market share information,
`
`gross sales figures, such as those in Exhibit 2021, are inadequate to establish
`
`commercial success. See In re Applied Materials, Inc., 692 F.3d 1289, 1300 (Fed.
`
`9
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`

`

`IPR2022-00545
`U.S. Patent 9,689,161
`Reply to Patent Owner Response
`
`Cir. 2012); In re Ben Huang, 100 F.3d 135, 140 (Fed. Cir.1996); Cable Elec.
`
`Prods., Inc. v. Genmark, Inc., 770 F.2d 1015, 1026-27 (Fed. Cir. 1985); Red
`
`Diamond, Inc. v. Southern Visions, LLP, IPR2019-01671, Paper 35, 39-40 (PTAB
`
`Mar. 31, 2021) (“Generally, sales figures, in the absence of a defined market, are
`
`inadequate to establish commercial success.”). Similarly, without knowing the
`
`relevant market and the identities of customers who purchased competing products,
`
`Molo’s claim that softwall has been purchased by high-profile customers does not
`
`establish commercial success.
`
`3.
`
`Copying
`
`Citing its own unverified complaint (Ex. 2032) and conclusory statements
`
`from its expert (Ex. 2010, ¶¶296-300), Molo argues that “Petitioner’s repeated
`
`imitation or copying of the ‘161 patent invention in preference to the prior art
`
`suggests that the invention is not obvious.” POR, 69. There is no record evidence
`
`to support Molo’s copying claim.
`
`“Not every competing product that arguably falls within the scope of a
`
`patent is evidence of copying. Otherwise every infringement suit would
`
`automatically confirm the nonobviousness of the patent.” Iron Grip Barbell Co. v.
`
`USA Sports, Inc., 392 F.3d 1317 (Fed. Cir. 2004). “[C]opying requires evidence of
`
`efforts to replicate a specific product, which may be demonstrated through internal
`
`company documents, direct evidence such as disassembling a patented prototype,
`
`10
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`IPR2022-00545
`U.S. Patent 9,689,161
`Reply to Patent Owner Response
`
`photographing its features, and using the photograph as a blueprint to build a
`
`replica, or access to the patented product combined with substantial similarity to
`
`the patented product.” Wyers v. Master Lock Co., 616 F.3d 1231, 1246 (Fed. Cir.
`
`2010).
`
`Here, there is no evidence of actual copying efforts by Chanel. It is
`
`undisputed that Chanel and Molo are not competitors, and that Chanel did not
`
`make the allegedly infringing articles; Chanel purchased them from a third-party
`
`vendor. MacAllen-Dep. 81:9-11, 82:1-6; Ex. 3001 at 7. Molo presents no evidence
`
`that Chanel had knowledge of the ’161 patent or acquired a physical sample of the
`
`softwall product before purchasing a competing product. Molo’s expert admitted
`
`that his copying opinion was based entirely on examining photos of the alleged
`
`copies. Ball-Dep. 41:13-43:14, 44:15-46:2-16. Thus, the record is devoid of the
`
`kind of evidence that is needed under Federal Circuit case law to establish copying.
`
`Additionally, Molo has not carried its burden to establish a nexus between
`
`the alleged copies and “some aspect of the claim not already in the prior art.” In re
`
`Kao, 639 F.3d at 1069. Molo presents pictures of the alleged copies but fails to
`
`explain why it believes they are materially different from the expandable cellular
`
`articles disclosed in the prior art.
`
`11
`
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`
`

`

`IPR2022-00545
`U.S. Patent 9,689,161
`Reply to Patent Owner Response
`
`4.
`
`Long-felt need
`
`Molo argues that the claimed invention fulfilled a long-felt need for “a
`
`prefabricated lightweight solution for partitioning interior space and creating
`
`backdrops for display that is flexible in both shape and length.” POR, 71. But Molo
`
`has not submitted actual evidence establishing any long-felt need.
`
`“[L]ong-felt need is analyzed as of the date of an articulated identified
`
`problem and evidence of efforts to solve that problem.” Tex. Instruments Inc. v.
`
`U.S. Int'l Trade Comm'n, 988 F.2d 1165, 1178 (Fed. Cir. 1993). A patent owner
`
`must submit “actual evidence of long-felt need, as opposed to argument.” In re
`
`Kahn, 441 F.3d 977, 990-91 (Fed. Cir. 2006). Molo presents no such evidence.
`
`Exhibit 2030—the only evidence identified by Molo—is an excerpt from
`
`Molo’s website in December 2022 that appears to include recent customer
`
`feedback regarding softwall and other products.5 Molo’s expert quotes from this
`
`same exhibit in his report. Ex. 2010, ¶¶240-243. The first two customer comments
`
`reference events that occurred in 2020. The other comments are undated. None of
`
`the comments references any long-felt need existing at the date of the invention
`
`
`5 Molo did not dispute that the content in Exhibit 2030 was first published on its
`
`website in 2021. MacAllen-Dep. 83:9-20; Forsythe-Dep. 41:20-25.
`
`12
`
`
`
`

`

`IPR2022-00545
`U.S. Patent 9,689,161
`Reply to Patent Owner Response
`
`claimed in the ’161 patent, or any efforts by others to solve the problem articulated
`
`by Molo. Thus, Exhibit 2030 falls far short of what is required to establish long-
`
`felt need.
`
`Moreover, the purported need articulated by Molo had already been met by
`
`expandable cellular partitions disclosed in the prior art. For example, SoftHousing I
`
`and SoftWall both disclose prefabricated lightweight solutions for partitioning
`
`interior space and creating backdrops for display that are flexible in both shape and
`
`length (the purported need). The differences between these prior art solutions and
`
`Molo’s softwall product are minimal, especially in terms of meeting the alleged
`
`need articulated by Molo. Thus, to the extent there ever was a long-felt need, that
`
`need was already solved by the time of the invention claimed in the ’161 patent.
`
`See Nike, Inc. v. Adidas AG, 955 F.3d 45, 54-55 (Fed. Cir. 2020); ZUP, LLC v.
`
`Nash Mfg., 896 F.3d 1365, 1374-75 (Fed. Cir. 2018); Geo M. Martin Co. v. All.
`
`Mach. Sys. Int'l LLC, 618 F.3d 1294, 1304-05 (Fed. Cir. 2010).
`
`IV. EVIDENCE OF UNPATENTABILITY
`
`A. Grounds 3-4 (SoftWall et al.; claims 1-10, 12, 14 and 18)
`
`Molo’s entire response to Grounds 3 and 4 boils down to an incorrect
`
`assertion that SoftWall does not disclose a “freestanding” wall. POR, 42-47.
`
`Molo’s position is not viable given the Board’s claim construction, the photo in
`
`SoftWall showing an expanded softwall standing alone, and Mr. MacAllen’s
`
`13
`
`
`
`

`

`IPR2022-00545
`U.S. Patent 9,689,161
`Reply to Patent Owner Response
`
`admission that this softwall was indeed “standing on its own.” Accordingly,
`
`Grounds 3 and 4 provide the most straightforward basis to cancel claims 1-10, 12,
`
`14 and 18 of the ’161 patent.
`
`The Board construed “freestanding” to mean “standing alone free of support
`
`or attachment.” ID, 11. The parties agree with that claim construction. POR, 19-20.
`
`Softwall, an article published in the September 2004 edition of Architectural
`
`Record magazine, discloses a softwall standing alone free of support or
`
`attachment:
`
`Ex. 1028, 4; see also Ex. 1003, ¶¶149-150, 162-163, 167-168; Rake-Dep. 207:17-
`
`22. The photo and description in SoftWall informs a POSITA that the expandable
`
`honeycomb wall is fully capable of being freestanding.
`
`
`
`Mr. MacAllen, one of the named inventors and creators of softwall, testified
`
`
`
`14
`
`
`
`

`

`IPR2022-00545
`U.S. Patent 9,689,161
`Reply to Patent Owner Response
`
`that the softwall shown in this photo in Exhibit 1028 was, in fact, “standing on its
`
`own.” MacAllen-Dep. 57:18-20 (“Q The softwall shown in Exhibit 1028 appears
`
`to be standing on its own. Was it? A Temporarily. Very temporarily.”). Thus, it is
`
`beyond dispute that SoftWall discloses a wall that is “freestanding” under the
`
`agreed claim construction.
`
`
`
`Molo’s response brief fails to present or even reference any other arguments
`
`against Grounds 3 and 4. POR, 42-47; see also DeSilva v. DiLeonardi, 181 F.3d
`
`865, 866-67 (7th Cir. 1999) (“A brief must make all arguments accessible to the
`
`judges, rather than ask them to play archaeologist with the record.”). Accordingly,
`
`claims 1-10, 12, 14 and 18 of the ’161 patent should be canceled.
`
`B. Grounds 1-2 (SoftHousing et al.; claims 1-10, 12, 14 and 18)
`
`In response to Grounds 1 and 2, Molo presents three main arguments: (1)
`
`that Chanel improperly relied on non-prior art images; (2) that SoftHousing I does
`
`not disclose a “freestanding” wall; and (3) that there is no disclosure of wall ends
`
`folded in a tubular configuration as required by dependent claim 4. POR, 22-41.
`
`All of these arguments fail for the reasons explained below.
`
`1.
`
`Chanel relied on SoftHousing images in the prior art
`
`Molo claims “the SoftHousing images used in the Petition are not found in
`
`the SoftHousing references,” and that “the images used in the Petition are of
`
`significantly higher quality and resolution than the images from the SoftHousing
`
`15
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`

`

`IPR2022-00545
`U.S. Patent 9,689,161
`Reply to Patent Owner Response
`
`references that a POSITA would have relied on at the time of the filing of the ’366
`
`Patent.” POR, 29. Both claims are demonstrably false. Large images of
`
`SoftHousing were published on the DBEW website (SoftHousing I, Ex. 1005) and
`
`in the related book (SoftHousing II, Ex. 1006) and were publicly accessible to a
`
`POSITA more than a year before the claimed priority date of November 28, 2005.
`
`Images of the DBEW 2003 winning works, including SoftHousing, were
`
`published online beginning in November 2003 so the public could view them:
`
`
`
`
`
`16
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`
`

`

`IPR2022-00545
`U.S. Patent 9,689,161
`Reply to Patent Owner Response
`
`Ex. 1021, 5, 14; see also Ex. 1047, 30-39.
`
`When one clicked through to view SoftHousing on the DBEW website, they
`
`arrived at a page where the SoftHousing images were initially presented as
`
`thumbnails, as shown in this excerpt from Exhibit 1005:
`
`
`
`Clicking these thumbnail images opened large images—“big_img/gp02-1.jpg”;
`
`“big_img/gp02-2.jpg”; “big_img/gp02-3.jpg”; “big_img/gp02-4.jpg”; and
`
`“big_img/gp02-5.jpg”—showing the details of the SoftHousing submission. This
`
`can still be seen today on the Internet Archive copy of Exhibit 1005.6 For example,
`
`left-clicking the first thumbnail on the left opens this larger image:
`
`
`6https://web.archive.org/web/20040509111623/http://www.hanssemcompe.com/en
`
`glish/PRI/2003/2003_gp02.asp; see also Ex. 1004, 4-6; Ex. 1005.

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