IN THE UNITED STATES DISTRICT COURT
`FOR THE WESTERN DISTRICT OF TEXAS
`MARSHALL DIVISION
`
`LEXOS MEDIA IP, LLC
`
`V.
`
`NIKE, INC.,
`
`LEXOS MEDIA IP, LLC
`
`V.
`
`ULTA, INC.,
`
`LEXOS MEDIA IP, LLC
`
`V.
`
`THE GAP, INC.,
`LEXOS MEDIA IP, LLC
`
`V.
`
`WALMART, INC., et al.
`
`
`
`Case No.: 2:22-cv-00311-JRG
`(Lead Case)
`
`
`
`Case No.: 2:22-cv-00299-JRG
`(Member Case)
`
`
`
`
`Case No.: 2:22-cv-00299-JRG
`(Member Case)
`
`
`
`Case No.: 2:22-CV-00316-JRG
`(Member Case)
`
`
`REBUTTAL REPORT OF DR. MICHAEL IAN SHAMOS, PH.D., J.D
`TO DR. HENRY HOUH’S REPORT CONCERNING THE VALIDITY
`OF U.S. PATENT NOS. 5,995,102, 6,118,449, AND 7,975,241
`
`
`
`
`Lexos Media Exhibit 2002, Page 1 of 527
`Ebay, Inc. v. Lexos Media IP, LLC
`IPR2024-00336 and IPR2024-00337
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`

`

`TABLE OF CONTENTS
`INTRODUCTION ................................................................................................................... 1
`I.
`II. SUMMARY OF OPINIONS ................................................................................................... 5
`III. OVERVIEW OF THE ASSERTED PATENTS ..................................................................... 5
`A. ’102 Patent ........................................................................................................................... 5
`B. ’449 Patent ........................................................................................................................... 6
`C. ’241 Patent ........................................................................................................................... 6
`D. Brief Overview of the Common Specification .................................................................... 7
`E. Benefits of the Patents ....................................................................................................... 12
`IV. LEGAL PRINCIPLES AND STANDARDS ........................................................................ 14
`A. Claim Construction ............................................................................................................ 23
`B. Definition of the “Person of Ordinary Skill in the Art ....................................................... 27
`C. Level of Ordinary Skill in the Art for the Patents .............................................................. 27
`V. REVIEW OF DR. HENRY HOUH’S REPORT ................................................................... 28
`A. Overview of the State of the Technology .......................................................................... 28
`B. Adveractive’s Fearless Fergie Mouse Game does not anticipate and/or render obvious any
`Asserted Claim. ......................................................................................................................... 29
`’102 Patent, Claim 72 ............................................................................................................ 30
`’449 Patent, Claim 1 .............................................................................................................. 33
`’449 Patent, Claim 27 ............................................................................................................ 36
`’449 Patent, Claim 53 ............................................................................................................ 38
`’241 Patent, Claim 35 ............................................................................................................ 39
`C. Adveractive’s Brunswick’s Cosmic Bowling Game does not Render Obvious any
`Asserted Claim. ......................................................................................................................... 44
`’102 Patent, Claim 72 ............................................................................................................ 45
`’449 Patent, Claim 1 .............................................................................................................. 47
`’449 Patent, Claim 27 ............................................................................................................ 50
`’449 Patent, claim 53 ............................................................................................................. 52
`’241 Patent, Claim 35 ............................................................................................................ 53
`D. Malamud Does Not Render Any Asserted Claim Obvious ............................................... 57
`’102 Patent, Claim 72 ............................................................................................................ 63
`E. The Combination of Nielsen and Malamud Does Not Render Obvious any Asserted
`Claims........................................................................................................................................ 69
`
`Lexos Media Exhibit 2002, Page 2 of 527
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`

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`’102 Patent, Claim 72 ............................................................................................................ 75
`’449 Patent, Claims 1, 27, 38 and 53 ..................................................................................... 78
`’241 Patent, Claim 35 ............................................................................................................ 79
`F. The Combination of Nielsen and Hama Does Not Render Any Asserted Claim Obvious 80
`’102 Patent, Claim 72 ............................................................................................................ 80
`Asserted Claims of the ’449 Patent ....................................................................................... 84
`’241 Patent, Claim 35 ............................................................................................................ 84
`G. Kojima Does Not Render Any Asserted Claim Obvious................................................... 86
`’102 Patent, Claim 72 ............................................................................................................ 87
`’449 Patent, Claims 1, 27, 38, 53........................................................................................... 89
`H. Rakavy Does Not Render Any Asserted Claim Obvious .................................................. 89
`I. Hama Does Not Render Claim 35 of the ’241 Patent Obvious ......................................... 90
`’241 Patent, Claim 35 ............................................................................................................ 90
`J. Anticipation of Claim 35 of the ’241 Patent by the ’102 Patent ........................................ 92
`K.
`Invalidity due to Lack of Written Description. .................................................................. 92
`L. Secondary Considerations of Non-Obviousness ................................................................ 92
`VI. CONCLUSION ..................................................................................................................... 93
`
`Lexos Media Exhibit 2002, Page 3 of 527
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`

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`I.
`
`INTRODUCTION
`
`1.
`
`2.
`
`My name is Michael Ian Shamos.
`
`I have been retained by Plaintiff Lexos Media IP, LLC (“LEXOS”) to offer my
`
`opinion whether of claim 72 of U.S. Patent 5,995,102 (the “’102 Patent”), claims 1, 38, and 53
`
`of U.S. Patent 6,119,449 (the “’449 Patent”), and claim 35 of U.S. Patent 7,975,241 (the “’241
`
`Patent”) (collectively, the “Asserted Claims”) are valid over the asserted Prior Art, and to
`
`respond to other invalidity assertions presented by Nike, Inc., Ulta Beauty, Inc., The Gap, Inc.
`
`and Walmart, Inc. et al. (collectively, “Defendants”).
`
`3.
`
`More specifically, I have been asked to respond to the “Opening Expert Report of
`
`Dr. Henry Houh,” dated December 18, 2023 (“Houh Report”) and the “Opening Expert Report
`
`of Mr. Glenn E. Weadock Regarding Invalidity of U.S. Patent Nos. 5,995,102, 6,118,449 and
`
`7,975,241,” also dated December 18, 2023 (“Weadock Report”). I have been informed by
`
`counsel that Lexos Media and Ulta Beauty, Inc. have recently filed a joint motion to stay in
`
`light of a settlement being reached, but I respond to the entire Opening Expert Report of Dr.
`
`Henry Houh for the sake of completeness.
`
`4.
`
`I am being compensated at my usual consulting rate of $600 per hour for my work
`
`related to this matter. My compensation does not depend on the contents of this report, any
`
`testimony I may provide, or the ultimate outcome of this matter. I do not have any direct
`
`financial interest in Plaintiff. It is conceivable that I may own mutual funds or investment
`
`accounts which themselves own shares of one or more Defendants. However, any such
`
`holdings collectively would not constitute a material portion of my net worth.
`
`5.
`
`I reserve the right to supplement and/or amend my opinions in this report based on
`
`future positions taken by Defendants, their experts, additional documents, testimony, or other
`
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`information provided by Defendants or their witnesses, any orders from the Court, or as
`
`otherwise necessary.
`
`6.
`
`My opinions and the bases for my opinions are provided in this Report and Exhibits
`
`attached hereto. If I am called as a witness in the above-captioned litigation, I expect that I
`
`would testify at trial regarding the matters expressed in this Report and any supplemental
`
`reports or declarations that I may prepare in connection with this litigation. I may also discuss
`
`work and publications in the field, and knowledge of the state of the art in the relevant time
`
`period. I may rely on handbooks, textbooks, technical literature, and the like to demonstrate
`
`the state of the art in the relevant time period and the evolution of relevant technologies. I
`
`expect that I may also testify to additional matters. These include, for example, matters
`
`addressed by the Defendants’ experts or by their counsel.
`
`7.
`
`When I say I “understand” a fact to be true or make a factual statement without a
`
`documentary citation that means I have been informed by counsel for Plaintiff that Plaintiff
`
`will provide proof at trial of such fact through admitted evidence. When I say that I
`
`“understand” a particular principle of law to be applicable, that means I have been informed
`
`by counsel for Plaintiff that I am to apply such principle of law.
`
`8.
`
`In connection with my anticipated testimony, I may use as exhibits various
`
`documents produced in this case or publicly available that refer or relate to the matters
`
`discussed in this Report. I have not yet selected the particular exhibits that might be used.
`
`9.
`
`In addition, I may create or assist in the creation of demonstrative evidence to assist
`
`me in testifying. For instance, at trial I may rely on software cited in this Report or compiled
`
`versions of related source code in order to illustrate the relevant functionality of those programs
`
`and aid the jury in their understanding of those programs. I may prepare static and/or animated
`
`Lexos Media Exhibit 2002, Page 5 of 527
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`exhibits that demonstrate Defendants’ websites or show a video depicting their use. I may also
`
`rely on screen shots or documents to generate demonstratives showing how such websites
`
`operate. The Asserted Patents relate to certain technology, and I may prepare demonstrative
`
`exhibits describing how that technology operates.
`
`10.
`
`I currently hold the title of Distinguished Career Professor in the School of
`
`Computer Science at Carnegie Mellon University in Pittsburgh, Pennsylvania. I am a member
`
`of two departments in that School, the Software and Societal Systems Department and the
`
`Language Technologies Institute. I was a founder and Co-Director of the Institute for
`
`eCommerce at Carnegie Mellon from 1998-2004 and from 2004-2018 was Director of the
`
`eBusiness Technology graduate program in the Carnegie Mellon University School of
`
`Computer Science. Since 2018, I have been Director of the M.S. in Artificial Intelligence and
`
`Innovation degree program at Carnegie Mellon.
`
`11.
`
`I received an A.B. (1968) from Princeton University in Physics; an M.A. (1970)
`
`from Vassar College in Physics; an M.S. (1972) from American University in Technology of
`
`Management, a field that covers quantitative tools used in managing organizations, such as
`
`statistics, operations research and cost-benefit analysis; an M.S. (1973), and M.Phil. (1974)
`
`and a Ph.D. from Yale University in Computer Science; and a J.D. (1981) from Duquesne
`
`University.
`
`12.
`
`I have taught graduate courses at Carnegie Mellon in Electronic Commerce,
`
`including eCommerce Technology, Electronic Payment Systems, Electronic Voting, Internet
`
`of Things, Electronic Payment Systems and eCommerce Law and Regulation, as well as
`
`Analysis of Algorithms. Since 2007 I have taught an annual course in Law of Computer
`
`Technology. I currently also teach Artificial Intelligence and Future Markets.
`
`Lexos Media Exhibit 2002, Page 6 of 527
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`13.
`
`I am the author and lecturer in a 24-hour video course on Internet protocols and
`
`have taught computer networking, wireless communication, and Internet architecture since
`
`1999.
`
`14.
`
`From 2001-2021, I was a Visiting Professor at the University of Hong Kong, where
`
`I taught an annual course in Electronic Payment systems. This is one of only a handful of
`
`graduate courses taught on this subject in the world.
`
`15.
`
`From 1979-1987 I was the founder and president of two computer software
`
`development companies in Pittsburgh, Pennsylvania, Unilogic, Ltd. and Lexeme Corporation.
`
`16.
`
`I am an attorney admitted to practice in Pennsylvania and have been admitted to
`
`the Bar of the U.S. Patent and Trademark Office since 1981. I have not been asked to offer any
`
`opinions on patent law in this proceeding.
`
`17.
`
`I am a named co-inventor on the following six issued patents relating to electronic
`
`commerce: U.S. Patent Nos. 7,330,839, 7,421,278, 7,747,465, 8,195,197, 8,280,773, and
`
`9,456,299.
`
`18.
`
`I have previously served as an expert in over 370 cases concerning computer
`
`technology. In particular, I have been involved in multiple cases involving Internet technology
`
`and delivery of content over the Internet. A current copy of my curriculum vitae setting forth
`
`details of my background and relevant experience, including a full list of my relevant
`
`publications and a listing of cases for which I have provided expert testimony is attached hereto
`
`as Exhibit A.
`
`19.
`
`In performing my analysis I have relied upon the materials listed in Exhibit B.
`
`Lexos Media Exhibit 2002, Page 7 of 527
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`II.
`
`SUMMARY OF OPINIONS
`
`20. My opinions are set forth in the body of this Report and in the Exhibits that I have
`
`prepared and attached to this Report. Without intending to limit in any way the opinions
`
`expressed in this Report, the following is a summary of my opinions.
`
`The Asserted Claims are not invalid for any of the reasons asserted by Dr. Houh.
`
`The Asserted Claims are not anticipated by Adveractive’s Fearless Fergie Mouse
`
`21.
`
`22.
`
`Game.
`
`23.
`
`The Asserted Claims are not invalid for obviousness over the Adveractive’s
`
`Brunswick Cosmic Bowling Game.
`
`24.
`
`25.
`
`26.
`
`27.
`
`28.
`
`29.
`
`30.
`
`31.
`
`32.
`
`The Asserted Claims are not invalid for obviousness in view of Malamud.
`
`The Asserted Claims are not invalid for obviousness over Nielsen and Malamud.
`
`The Asserted Claims are not invalid for obviousness in view of Nielsen and Hama.
`
`The Asserted Claims are not invalid for obviousness in view of Kojima.
`
`Claim 35 of the ’241 Patent is not invalid for obviousness in view of Rakavy.
`
`Claim 35 of the ’241 Patent is not invalid for obviousness in view of Hama.
`
`Claim 35 of the ’241 Patent is not anticipated by the ’102 Patent.
`
`The Asserted Claims are not invalid for lack of written description.
`
`There are secondary considerations of non-obviousness.
`
`III. OVERVIEW OF THE ASSERTED PATENTS
`
`A. ’102 Patent
`
`33.
`
`The ’102 Patent is entitled “Server System and Method for Modifying a Cursor
`
`Image.” It was filed on June 25, 1997.
`
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`34.
`
`The ’102 Patent relates generally to computer display cursors. More specifically,
`
`the invention discloses sending code from a server to a client to modify the appearance of a
`
`display cursor on the client.
`
`35.
`
`The ’102 Patent names James Samuel Rosen, Thomas A. Schmitter, and Mark S.
`
`Hall as the inventors. The records of the United States Patent and Trademark Office (“PTO”)
`
`show that the patent was assigned to Plaintiff by an instrument executed on January 15, 2013
`
`and recorded in the PTO on March 19, 2013.
`
`36.
`
`The ’102 Patent expired on June 25, 2017.
`
`B. ’449 Patent
`
`37.
`
`The ’449 Patent is entitled “Server System and Method for Modifying a Cursor
`
`Image.” It was filed on September 21, 1999 as a continuation of the application that became
`
`the ’102 Patent and was therefore effectively filed on June 25, 1997.
`
`38.
`
`The ’449 Patent shares the same specification as the ’102 Patent, so it relates to the
`
`same field.
`
`39.
`
`The ’449 Patent also names James Samuel Rosen, Thomas A. Schmitter, and Mark
`
`S. Hall as the inventors. The records of the PTO show that the patent was assigned to Plaintiff
`
`by an instrument executed on January 15, 2013 and recorded in the PTO on March 19, 2013.
`
`40.
`
`Because of the terminal disclaimer, the ’449 Patent expired on the same day as the
`
`’102 Patent, that is, June 25, 2017.
`
`C. ’241 Patent
`
`41.
`
`The ’241 Patent is entitled “System for Replacing a Cursor Image in Connection
`
`with Displaying the Contents of a Webpage.” It was filed on January 21, 2005 and published
`
`on September 29, 2005.
`
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`42.
`
`The ’241 Patent names James Samuel Rosen, Thomas A. Schmitter, and Mark S.
`
`Hall as the inventors. The records of the PTO show that the patent was assigned to Plaintiff by
`
`an instrument executed on January 15, 2013 and recorded in the PTO on March 19, 2013.
`
`43.
`
`The ’241 Patent issued on July 5, 2011. The ’241 Patent term was extended by 1175
`
`days. It expired on September 12, 2020.
`
`44.
`
`Dr. Houh states that he “understand[s] June 21, 2005 to be the priority date for the
`
`’241 patent.” Houh Report at ¶ 73. I understand the ’241 Patent to claim priority to the ’102
`
`Patent, making its priority date June 25, 1997. I further understand that there is a dispute
`
`between the parties of the significance of a claim of priority that appears in the prosecution
`
`history of the ’241 Patent but does not appear in the printed patent itself, which I understand
`
`to be a matter of law.
`
`D. Brief Overview of the Common Specification
`
`45.
`
`The Asserted Patents in this consolidated litigation are: (1) U.S. Patent No.
`
`5,994,102, (2) U.S. Patent No. 6,118,449, both of which are entitled “Server System and
`
`Method of Modifying a Cursor Image,” and (3) U.S. Patent No. 7,975,241, entitled “System
`
`for Replacing a Cursor Image In Connection with Displaying the Contents of a Webpage”.
`
`Each of the Asserted Patents shares the same specification (“Common Specification”). The
`
`application for the ’102 Patent was filed on June 25, 1997. For ease of reference, patent
`
`citations to the Common Specification will be with reference to the column and line numbering
`
`of the ’102 Patent.
`
`46.
`
`At the time of the invention, more and more companies were advertising on the
`
`Internet. ’102 Patent, 1:21-23. Three typical forms of advertising at the time of the invention
`
`were “banner ads,” 1:24-25, “frames,” 1:55-56, and “self-appearing windows.” 2:4-5. Each
`
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`form of advertising had its drawbacks and limitations, as explained in the specification. 1:24-
`
`2:32. Consequently, the inventors recognized “a need for a simple means to deliver advertising
`
`elements . . . without the annoyance of totally interrupting and intrusive content delivery, and
`
`without the passiveness of ordinary banner and frame advertisements which can be easily
`
`ignored.” 2:27-32. Thus, it was a specific objective of the inventions “to provide a server
`
`system for modifying a cursor image to a specific image displayed on a video monitor of a
`
`remote user’s terminal for the purposes of providing on-screen advertising.” 2:44-47.
`
`47.
`
`The claimed inventions provide for server systems that enable a cursor or pointer
`
`displayed on a remote client’s computer to change its appearance to a “specific image” that is
`
`representative of the content being displayed on that client computer. 4:4-12. The modified
`
`cursor image can be used by the provider of displayed web content to advertise or promote the
`
`displayed content. 3:51-4:3. As the Common Specification explains, “[t]he present invention
`
`provides a means for enabling cursors and pointers to change color, shape, appearance, make
`
`sounds, display animation, etc., when the user’s terminal or computer, known as the ‘client’ or
`
`‘user’ terminal, which has a network connection, receives certain instructions from a remote
`
`or ‘server’ computer attached to the network.” 3:51-57.
`
`48.
`
`The Common Specification describes “an exemplary embodiment of the present
`
`invention” whereby:
`
`[T]he generic cursor or pointer icons used in many
`networking applications, such as black arrows, hands with a
`pointing finger, spinning wheels, hourglasses, wristwatches,
`and others, will change appearance, and in some cases may
`incorporate sound or animation, in a way that is linked and
`related to the content, such as a webpage, which is being
`transmitted to and displayed on the client computer.
`
``102 Patent, 3:57-64.
`
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`49.
`
`“The cursor or pointer image may also appear in a specified shape or color that is
`
`intended to convey a message that relates to the advertising content within the webpage being
`
`transmitted and displayed.” 3:67-4:3. See also 7:2-5 (“the server system provides certain
`
`information that causes the cursor image on the video monitor of the user terminal to display
`
`an image as specified by the server system.”).
`
`50.
`
`The invention relates to a graphical user interface in which a pointing device is used
`
`by the user to navigate a video display, and in which movement of the pointing device is
`
`indicated by a corresponding movement of a cursor on the video display. 8:24–37. The ’102
`
`Patent relates to changing that generic cursor by sending data and control signals from a remote
`
`computer to replace such a cursor with a cursor having an shape and appearance that is
`
`associated with other content being displayed to the user, e.g., a logo, mascot, or an image of
`
`a product or service, related to the other content being displayed to the user. 3:4–9, 17:5–18:3.
`
`51.
`
`Figure 8 of the Common Specification, reproduced below, shows a webpage
`
`according to the invention.
`
`
`
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`52.
`
`In Figure 8, shown above, webpage 60a is displayed to a user, including banner ad
`
`62 for cola. Id. at 13:31–37. The cursor on this webpage changes from a standard cursor (e.g.,
`
`an arrow) to cola-bottle-shaped cursor 44a, which is associated with banner ad 62. Id. The ’102
`
`Patent describes interactions between a server system and a user’s terminal to effect the cursor
`
`change. Id. at 4:4–9, 5:37–49, 5:48–65, 7:16–40. The user terminal is controlled by an
`
`operating system (“OS”), and application programs, such as a browser running on the user
`
`terminal, use an application programming interface (“API”) to interface with the OS. Id. at
`
`7:29-40, Fig. 2.
`
`53.
`
`The server system transmits specified content information to the user terminal,
`
`including information to be displayed on the user’s computer (such as a hypertext markup
`
`language (“HTML”) webpage), cursor display instructions, and cursor display code. 8:4–23.
`
`The cursor display instructions indicate where the cursor image data corresponding to the new
`
`appearance of the cursor resides. 8:49–64. The cursor display code causes the user’s terminal
`
`to display cursor image data in place of the original cursor, using the API of the operating
`
`system to effect these changes. 8:34–37, 8:52–57; 13:19–30.
`
`54.
`
`As extensively described in the Common Specification, e.g. 7:41-14:64, when a
`
`browser requests a webpage from a server, it receives back an HTML file that includes content
`
`to displayed and/or pointers thereto, formatting instructions on how to display the content, and
`
`instructions and/or code specifying how the webpage is to interact with the user, including how
`
`the cursor modification takes place and specific images are displayed. The browser then uses
`
`the received information to generate the webpage displayed to the user, including the shape
`
`and appearance of the modified cursor image.
`
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`55.
`
`As the Common Specification also describes, the content of the specific image may
`
`be dynamically updated and may also change based upon cursor movement, according, e.g., to
`
`changes in its position or speed. 14:49-53 (“…it is possible to vary the modification to the
`
`cursor as a function of cursor position. For example, the cursor pointer could be controlled
`
`such that it ‘points’ to a specific location on the screen regardless of the cursor’s location on
`
`the screen as illustrated in line 214 of FIG 4.”); 14:54-64 (“In accordance with another
`
`embodiment of the invention it is possible to vary the modification to the cursor as a function
`
`of cursor velocity. For example, the cursor image could change from a stationary bird to a bird
`
`with flapping wings only when the cursor is moved quickly across the screen as illustrated in
`
`line 215 of FIG. 4.”); 17:17-21 (“A dynamic cursor image could then be used to show a person
`
`holding a straw in such a way that the straw always points from the user toward the top of the
`
`Fizzy bottle, no matter where the cursor moves on the screen.”); 17:55-61 (“It may also be
`
`desirable in certain cases to put alphanumeric data in the cursor ‘space’ to convey information
`
`to users, such as stock prices, baseball game scores, the temperature in Florida, etc. The data
`
`can be static, semi-static (i.e. updated periodically), or dynamic (updated frequently -- possibly
`
`incorporating available streaming-data and data compression technologies.”)
`
`56.
`
`The specification also describes that the cursor modification can also incorporate
`
`satellite images that are spaced apart from the modified cursor image and also track its
`
`movement. For example, in describing one exemplary embodiment, the Common
`
`Specification states at 17:17-31:
`
`“A dynamic cursor image could then be used to show a
`
`person holding a straw in such a way that the straw always
`
`points from the user toward the top of the Fizzy bottle, no
`
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`matter where the cursor moves on the screen. The straw, in
`
`this case, might be "attached" to the cursor image (part of the
`
`same image) or could be separate, "satellite" image, a
`
`"sprite," whose movement on the screen (in this case) is
`
`related to the movement of the cursor. Sprites, which can
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`appear and disappear as desired, can enhance the invention
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`by enabling the use of graphical elements which are
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`associated with the cursor but which reside outside the
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`limited cursor "space" (which in some systems may be, at
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`maximum, 32 by 32 pixels). For the purposes of the
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`invention, however, there should be no limitation to the size
`
`of the cursor.”
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`57.
`
`This teaching of non-traditional cursor images is reinforced throughout the
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`specification used for promotional purposes is reinforced throughout the specification. For
`
`example, Cursor Display Instructions that include parameters that control the type of cursor
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`image for the modification, how long the changed image should remain before reverting, its
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`trajectory path, where it should change based upon its screen location and what satellite images
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`should be used that track its movement. 9:39-65.
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`E. Benefits of the Patents
`
`58.
`
`In this analysis, I focus specifically on the benefits of the 5,995,102, 6,118,449 and
`
`7,975,241 patents to Internet retailers, not on their general benefits.
`
`59.
`
`The Patents claim various systems and methods that address problems in online
`
`advertising, namely that banner ads are easily ignored (1:41-54), webpage frames cause
`
`Lexos Media Exhibit 2002, Page 15 of 527
`Ebay, Inc. v. Lexos Media IP, LLC
`IPR2024-00336 and IPR2024-00337
`
`

`

`cramping and reduced content space (1:55-2:3), and pop-up windows are easily obscured,
`
`closed or ignored (2:4-26). The patents solve these problems via objectives described at 2:37-
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`3:50.
`
`60.
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`The inventors recognized that content associated with a cursor is not easily ignored
`
`because the cursor is a user’s pointing device and the user’s eyes tend to follow the cursor. A
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`basic idea of the inventions is to change the appearance of the cursor based on the content it is
`
`pointing to. 3:51-4:3. The change in appearance can alter the size, shape, color, text or image
`
`associated with the cursor.
`
`61. Major outlets for Internet advertising are product webpages of Internet retailers,
`
`such as Defendants. An objective of a product page is to induce the viewer to buy the product.
`
`This was commonly done by providing color images of the product, textual descriptions,
`
`product specifications, and customer testimonials. Of these, images are the most captivating
`
`and effective because customers are reluctant to buy a product they have not been able to view.
`
`62.
`
`It was known to allow a user to click on an image to view a magnified image of the
`
`product, then click again to restore the image to its original size. This is useful but somewhat
`
`clumsy, as it involves a lot of mouse clicking. The inventors provide this solution: mere
`
`movement of the mouse over a portion of page content results in an image associated with that
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`content to be displayed along with the cursor as the cursor moves. 9:1-20. In this way, the user
`
`can move the cursor over an image of a product and view, for example, an expanded image of
`
`the relevant portion of the product as an associated image.
`
`63.
`
`This cursor modification invention is very effective, as can be seen by the layperson
`
`viewing a Defendant’s webpage.
`
`Lexos Media Exhibit 2002, Page 16 of 527
`Ebay, Inc. v. Lexos Media IP, LLC
`IPR2024-00336 and IPR2024-00337
`
`

`

`64.
`
`Thus, the Asserted Patents disclose and enable systems and methods in which
`
`cursor images are dynamically modified for promotional and advertising purposes. In the ’102
`
`and ’449 Patents, the specific shape and appearance of the modified cursor image corresponds
`
`to other content being displayed on the webpage to promote that content. In the ’241 patent,
`
`the modified cursor image includes a dynamic visual image that tracks movement. The various
`
`examples disclosed in the Patents of promotional cursors include images that dynamically
`
`update with the cursors’ movements, including associated images that are not integrated with
`
`the modified cursor image but which also track a movement.
`
`IV. LEGAL PRINCIPLES AND STANDARDS
`
`65.
`
`I have been informed by counsel for Plaintiff that the following principles of law
`
`are applicable to this matter, and I have applied these principles in my analysis.
`
`66.
`
`I understand that a patent may be granted for any “new and useful process, machine,
`
`manufacture, or composition of matter, or any new and useful improvement thereof…” 35
`
`U.S.C. § 101.
`
`67.
`
`I understand that the claims of an issued U.S. Patent are presumed to be valid and
`
`enforceable. I understand that this presumption ap