Case 1:21-cv-01578-VEC Document 54 Filed 02/25/22 Page 1 of 3
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`UNITED STATES DISTRICT COURT
`SOUTHERN DISTRICT OF NEW YORK
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`Molo Design, Ltd.
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`Plaintiff,
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`-v-
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`Chanel, Inc.
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`Defendant.
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`Case No. 21-CV-1578 (VEC)
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`CHANEL’S RESPONSE TO
`MOLO’S SUPPLEMENTAL
`CLAIM CONSTRUCTION
`STATEMENT
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`Defendant Chanel, Inc. (“Chanel”) respectfully submits this response to Plaintiff Molo
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`Design, Ltd.’s (“Molo”) Supplemental Claim Construction Statement, Dkt. 51.
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`Molo selectively quotes from Chanel’s inter partes review (“IPR”) petitions to present an
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`incomplete and misleading summary of Chanel’s claim construction position. Chanel never made
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`any unqualified assertion that “none of the claim terms require construction,” as Molo wrongly
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`contends. Dkt. 51 at 2. What Chanel argued in its IPR petitions is that the Board need not
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`construe any claims to resolve the specific prior art invalidity grounds raised in those petitions:
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`The Board need only construe the claims when necessary to resolve the underlying
`controversy. Lectrosonics inc. v. ZaxCom, Inc., IPR2018-01129, Paper 33, 2020
`Pat. App. LEXIS 2043 (P.T.A.B. Jan. 24, 2020) (precedential), citing Nidec Motor
`Corp. v. Zhongshan Broad Ocean Motor Co., 868 F.3d 1013, 1017 (Fed. Cir. 2017).
`Here, given the close relationship between the Challenged Claims and the asserted
`prior art (some of which describes earlier work by the ’366 patent’s named
`inventors), the Board need not construe any terms in order to resolve the underlying
`controversy. Any reasonable interpretation of those terms—as understood by a
`POSITA at the time of the invention—reads on the prior art.
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`Dkt. 48-1 at 24-25; see also Dkt. 48-2 at 21-22; Dkt. 48-3 at 22-23; Dkt. 48-4 at 22.
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`The reason claim construction is unnecessary in Chanel’s IPR proceedings is because
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`those proceedings are statutorily limited in scope to issues of invalidity based on prior art patents
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`Patent Owner Molo Design, Ltd. - Exhibit 2004
`Page 1
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`Case 1:21-cv-01578-VEC Document 54 Filed 02/25/22 Page 2 of 3
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`and printed publications, and Chanel is relying on prior art concerning the same subject matter as
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`Molo’s patents, including earlier publications by the named inventors of the Molo patents. Given
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`the close relationship between the patents and the asserted prior art, claim construction would not
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`affect the outcome in the IPRs – under any reasonable claim construction, the claims are invalid.
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`This is what Chanel argued in its IPR petitions, as shown in the quoted language above.
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`Chanel never argued that claim construction was unnecessary in the district court action.
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`To the contrary, in each of its IPR petitions, Chanel expressly “reserves the right to raise claim
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`construction arguments in the co-pending district court action and any other proceedings as
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`appropriate.” Dkt. 48-1 at 25 n.7; Dkt. 48-2 at 22 n.5; Dkt. 48-3 at 23 n.5; Dkt. 48-4 at 22 n.5.
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`Claim construction is still required in the district court action because the district court
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`action involves a broader set of issues, including affirmative defenses and counterclaims of non-
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`infringement and indefiniteness that cannot be raised in the IPR proceedings. The need for claim
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`construction in the district court action is further explained in Chanel’s claim construction brief.
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`See, e.g., Dkt. 43 at 2, 9, 12, 17–18.
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`There is nothing inherently improper about a party seeking claim construction in a district
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`court action and not seeking claim construction in a related IPR proceeding. The different scope
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`of the two proceedings can make claim construction necessary in one but not the other, as is the
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`case here. The Patent Trial and Appeal Board (“PTAB”) recently addressed this issue in another
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`proceeding where the patent challenger sought claim construction in the district court action but
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`not in its IPR petition. The PTAB declined to take issue with this difference, explaining that
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`“alternative pleading before a district court is common practice, especially where it concerns
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`issues outside the scope of inter partes review.” Target Corp. v. Proxicom Wireless, LLC,
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`IPR2020-00904, Paper 11 at 12 (PTAB Nov. 10, 2020). At least one district court has addressed
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`a similar issue and denied the plaintiff’s request that the defendant be judicially estopped from
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`arguing for a claim construction that differed from the one offered during a related IPR. Panduit
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`Corp. v. Corning Inc., 2021 U.S. Dist. LEXIS 124157, at *2–3 (E.D.N.C. July 2, 2021).
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`Chanel respectfully submits that its decision not to pursue claim construction in the IPR
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`proceedings has no bearing on its claim construction positions in this district court action.
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`However, to the extent this Court considers claim construction positions from the IPR
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`proceedings, Chanel respectfully requests that it also consider Molo’s IPR claim construction
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`positions that will be disclosed in Molo’s IPR Preliminary Responses due in May 2022.
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`Dated: February 25, 2022
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`DORSEY & WHITNEY LLP
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`By /s/ Geoffrey M. Godfrey
`Geoffrey M. Godfrey (pro hac vice)
`godfrey.geoff@dorsey.com
`DORSEY & WHITNEY LLP
`Columbia Center
`701 Fifth Avenue, Suite 6100
`Seattle, WA 98104
`(206) 903-8800
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`Shannon L. Bjorklund (pro hac vice)
`bjorklund.shannon@dorsey.com
`Donna Reuter (pro hac vice)
`reuter.donna@dorsey.com
`DORSEY & WHITNEY LLP
`50 South Sixth Street, Suite 1500
`Minneapolis, MN 55402
`(612) 340-2600
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`Bruce R. Ewing
`ewing.bruce@dorsey.com
`DORSEY & WHITNEY LLP
`51 West 52nd Street
`New York, NY 10019
`(212) 415-9200
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`Counsel for Defendant Chanel, Inc.
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`Patent Owner Molo Design, Ltd. - Exhibit 2004
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