Trials@uspto.gov
`571-272-7822
`
`
`Paper No. 37
`
`Entered: December 21, 2018
`
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`INTEX RECREATION CORP., BESTWAY (USA) INC., WALMART
`INC., WAL-MART STORES TEXAS, LLC, WAL-MART.COM USA
`LLC, and SAM’S WEST, INC. d/b/a SAM’S CLUB,
`Petitioners,
`
`v.
`
`TEAM WORLDWIDE CORP.,
`Patent Owner.
`
`____________
`
`IPR2018-00859 (Patent 9,211,018 B2)
`IPR2018-00870 (Patent 7,246,394 B2)
`IPR2018-00871 (Patent 7,246,394 B2)
`IPR2018-00872 (Patent 7,246,394 B2)
`IPR2018-00873 (Patent 7,246,394 B2)
`IPR2018-00874 (Patent 7,246,394 B2)
`IPR2018-00875 (Patent 7,346,950 B2)
`____________
`
`
`Before BEVERLY M. BUNTING, JAMES J. MAYBERRY, and
`ERIC C. JESCHKE, Administrative Patent Judges.
`
`MAYBERRY, Administrative Patent Judge.
`
`
`DECISION1
`Patent Owner’s Motion for Additional Discovery
`37 C.F.R. § 42.51(b)(2)
`
`
`1 This Order addresses issues that are the same in all listed cases. The
`parties, however, are not authorized to use this style heading for any
`subsequent papers.
`
`
`571-272-7822
`
`
`Paper No. 37
`
`Entered: December 21, 2018
`
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`INTEX RECREATION CORP., BESTWAY (USA) INC., WALMART
`INC., WAL-MART STORES TEXAS, LLC, WAL-MART.COM USA
`LLC, and SAM’S WEST, INC. d/b/a SAM’S CLUB,
`Petitioners,
`
`v.
`
`TEAM WORLDWIDE CORP.,
`Patent Owner.
`
`____________
`
`IPR2018-00859 (Patent 9,211,018 B2)
`IPR2018-00870 (Patent 7,246,394 B2)
`IPR2018-00871 (Patent 7,246,394 B2)
`IPR2018-00872 (Patent 7,246,394 B2)
`IPR2018-00873 (Patent 7,246,394 B2)
`IPR2018-00874 (Patent 7,246,394 B2)
`IPR2018-00875 (Patent 7,346,950 B2)
`____________
`
`
`Before BEVERLY M. BUNTING, JAMES J. MAYBERRY, and
`ERIC C. JESCHKE, Administrative Patent Judges.
`
`MAYBERRY, Administrative Patent Judge.
`
`
`DECISION1
`Patent Owner’s Motion for Additional Discovery
`37 C.F.R. § 42.51(b)(2)
`
`
`1 This Order addresses issues that are the same in all listed cases. The
`parties, however, are not authorized to use this style heading for any
`subsequent papers.
`
`
`
`IPR2018-00859 (Patent 9,211,018 B2)
`IPR2018-00870 (Patent 7,246,394 B2)
`IPR2018-00871 (Patent 7,246,394 B2)
`IPR2018-00872 (Patent 7,246,394 B2)
`IPR2018-00873 (Patent 7,246,394 B2)
`IPR2018-00874 (Patent 7,246,394 B2)
`IPR2018-00875 (Patent 7,346,950 B2)
`
`
`BACKGROUND
`On September 14, 2018, we instituted trial in four related inter partes
`review proceedings involving Bestway (USA) Inc., Intex Recreation Corp.,
`Walmart Inc., Wal-Mart Stores Texas, LLC, Wal-Mart.com USA LLC, and
`Sam’s West, Inc. d/b/a Sam’s Club (collectively, “Petitioners”)2 and Team
`Worldwide Corp. (“Patent Owner”). (IPR2018-00870, IPR2018-00871,
`IPR2018-00872, and IPR2018-00875—the “September institutions”). On
`October 29, 2018, we instituted three additional proceedings involving
`Petitioners and Patent Owner. (IPR2018-00859, IPR2018-00873, and
`IPR2018-00874—the “October institutions”).
`On November 29, 2018, we authorized Patent Owner to file a motion
`for additional discovery and also authorized Petitioner to file an opposition
`to that motion in the seven proceedings constituting the September
`institutions and October institutions. Paper 26, 6.3 Patent Owner filed its
`Motion for Additional Discovery and Motion for Authorization to Compel
`Discovery (“Motion”) on December 6, 2018. Paper 28. Petitioners filed
`
`
`2 The petitions in these proceedings indicated that, along with Petitioners,
`the following entities are real parties-in-interest in the proceedings: Intex
`Development Company Ltd., Intex Industries (Xiamen) Co., Ltd., Intex
`Marketing Ltd., Intex Trading Ltd., Bestway Global Holdings, Inc., Bestway
`(Hong Kong) International, Ltd., Bestway Inflatables & Materials Corp.,
`Bestway (Hong Kong) Enterprise Co. Ltd., Bestway (Nantong) Recreation
`Corp., The Coleman Company, Inc., and Newell Brands Inc.
`3 We cite to the documents in IPR2018-00859 only. Similar papers are part
`of the record in the other six proceedings.
`
`
`
`2
`
`
`
`IPR2018-00859 (Patent 9,211,018 B2)
`IPR2018-00870 (Patent 7,246,394 B2)
`IPR2018-00871 (Patent 7,246,394 B2)
`IPR2018-00872 (Patent 7,246,394 B2)
`IPR2018-00873 (Patent 7,246,394 B2)
`IPR2018-00874 (Patent 7,246,394 B2)
`IPR2018-00875 (Patent 7,346,950 B2)
`
`their opposition to the Motion on December 13, 2018 (“Opposition”). Paper
`34. On December 17, 2018, Patent Owner contacted the Board by email
`requesting to file a reply to the Opposition (“Reply”).
`A related matter to these seven pending inter partes review
`proceedings is an infringement suit in the U.S. District Court for the Eastern
`District of Texas, in a case styled Team Worldwide Corp. v. Walmart Inc. et
`al., No. 2-17-cv-00235-JRG (“Litigation”). The discovery of confidential
`information in the Litigation is governed by a protective order from the
`district court. See Ex. 2012.4 Patent Owner indicates that the Litigation has
`been “recently settled.” Mot. 1; see also Opp. 4 (“The Litigation was . . .
`dismissed.”).5
`
`
`
`4 We take this opportunity to remind the parties that the Board is not a party
`to the district court’s protective order. Although we respect the orders of
`that court, we cannot provide any relief from or otherwise enforce the
`protective order. To the extent that Patent Owner believes it needs relief
`from the district court’s protective order, Patent Owner must seek that relief
`from the district court. Similarly, to the extent that Petitioners believe they
`are entitled to a remedy for any alleged violation of the district court’s
`protective order, they must seek that remedy from the district court.
`5 The parties are reminded of their continuing obligation to update their
`mandatory notices within 21 days of any change of the information listed in
`37 C.F.R. § 42.8(b) stated in an earlier paper, including changes in related
`matters. 37 C.F.R. §§ 42.8(a)(3), 42.8(b)(2).
`
`
`
`3
`
`
`
`IPR2018-00859 (Patent 9,211,018 B2)
`IPR2018-00870 (Patent 7,246,394 B2)
`IPR2018-00871 (Patent 7,246,394 B2)
`IPR2018-00872 (Patent 7,246,394 B2)
`IPR2018-00873 (Patent 7,246,394 B2)
`IPR2018-00874 (Patent 7,246,394 B2)
`IPR2018-00875 (Patent 7,346,950 B2)
`
`
`MOTION FOR ADDITIONAL DISCOVERY
`Discovery in inter partes review proceedings is more limited than in
`district court patent litigation. The America Invents Act (AIA) limits
`discovery to “(A) the deposition of witnesses submitting affidavits or
`declarations; and (B) what is otherwise necessary in the interest of justice.”
`35 U.S.C. § 316(a)(5). “Given the time deadlines imposed on [inter partes
`review] proceedings,” Congress intended the Board to “be conservative in its
`grants of discovery.” 154 Cong. Rec. S9988-89 (daily ed. Sept. 27, 2008)
`(remarks of Sen. Kyl). Our rules provide that the parties may agree to
`additional discovery between themselves. 37 C.F.R. § 42.51(b)(2). If the
`parties fail to agree, a party may move for additional discovery. Id. The
`moving party must show that such additional discovery is in the interests of
`justice. Id. If the motion is granted, the Board may specify conditions for
`such additional discovery. Id.
`Our analysis of whether the requested additional discovery is in the
`interests of justice is informed by Garmin International, Inc. v. Cuozzo
`Speed Technologies LLC, Case IPR2012-00001 (Mar. 5, 2013) (Paper 26)
`(precedential). Garmin identifies five factors that are important to our
`analysis. Id., slip. op. at 6–7. These factors are: (1) whether there exists
`more than a possibility and mere allegation that something useful will be
`discovered; (2) whether the requests seek the other party’s litigation
`positions and the underlying basis for those positions; (3) whether the
`moving party has the ability to generate equivalent information by other
`
`
`
`4
`
`
`
`IPR2018-00859 (Patent 9,211,018 B2)
`IPR2018-00870 (Patent 7,246,394 B2)
`IPR2018-00871 (Patent 7,246,394 B2)
`IPR2018-00872 (Patent 7,246,394 B2)
`IPR2018-00873 (Patent 7,246,394 B2)
`IPR2018-00874 (Patent 7,246,394 B2)
`IPR2018-00875 (Patent 7,346,950 B2)
`
`means; (4) whether the moving party has provided easily understandable
`instructions; and (5) whether the requests are overly burdensome to answer.
`Id. As discussed below, we determine that Patent Owner has not made the
`requisite showing that the additional discovery sought is in the interests of
`justice.
`
`Patent Owner’s Requests
`Patent Owner moves for additional discovery of “approximately 55
`documents” that were listed in a letter from Patent Owner to Petitioners’
`counsel. Mot. 1; see Ex. 2014 (listing 55 documents by Litigation Bates
`number). Patent Owner categorizes these documents generally as (1)
`technical drawings, (2) sales data; (3) survey data, (4) relevant deposition
`testimony; (5) internal perceptions and analysis; and (6) party
`admissions/argument. Mot. 3. Patent Owner does not provide any other
`specific information describing the content of the 55 documents for which
`discovery is sought.
`Garmin Factor 1 – More Than a Possibility and Mere Allegation
`“The party requesting discovery should already be in possession of
`evidence tending to show beyond speculation that in fact something useful
`will be uncovered.” IPR2012-00001, Paper No. 26 at 6. We find that the
`first Garmin factor weighs heavily against Patent Owner’s request.
`
`
`
`5
`
`
`
`IPR2018-00859 (Patent 9,211,018 B2)
`IPR2018-00870 (Patent 7,246,394 B2)
`IPR2018-00871 (Patent 7,246,394 B2)
`IPR2018-00872 (Patent 7,246,394 B2)
`IPR2018-00873 (Patent 7,246,394 B2)
`IPR2018-00874 (Patent 7,246,394 B2)
`IPR2018-00875 (Patent 7,346,950 B2)
`
`
`Patent Owner fails to explain sufficiently what the requested
`documents constitute and why they include useful information. See Mot. 8.6
`The closest statement Patent Owner offers in support of this factor is that
`“Patent Owner’s litigation counsel reviewed the documents and has
`determined they are highly relevant to secondary considerations.” Id. Patent
`Owner adds that “[m]any of the requested documents were referenced in
`expert reports in the litigation, and motions for summary judgment and they
`are highly relevant to secondary considerations of non-obviousness.” Id. As
`Petitioners argue, merely providing a very general description of the
`documents and a blanket statement that the documents are “highly relevant”
`fails to demonstrate, beyond speculation, that the identified documents
`would uncover useful information. See Opp. 9–10. Indeed, we expect the
`moving party to indicate, with specificity, what each document will uncover
`and how that information is useful to the moving party. See IPR2012-
`00001, Paper 26 at 7 (stating “useful” means “favorable in substantive value
`to a contention of the party moving for discovery”).
`Instead, Patent Owner leaves us to guess as to the nature of
`information sought and how the information is relevant to this proceeding.
`Patent Owner fails to indicate what information each document will show
`(or even each category of documents) will tend to show and how that
`
`
`6 We note that, out of Patent Owner’s 10-page Motion, slightly over 1 page
`was dedicated to Patent Owner’s analysis of the Garmin factors.
`
`
`
`6
`
`
`
`IPR2018-00859 (Patent 9,211,018 B2)
`IPR2018-00870 (Patent 7,246,394 B2)
`IPR2018-00871 (Patent 7,246,394 B2)
`IPR2018-00872 (Patent 7,246,394 B2)
`IPR2018-00873 (Patent 7,246,394 B2)
`IPR2018-00874 (Patent 7,246,394 B2)
`IPR2018-00875 (Patent 7,346,950 B2)
`
`information is useful in the context of “secondary considerations.” One
`group of documents, on which Petitioners focus, are documents attached to
`some of the 55 identified documents. See Opp. 1–2. Patent Owner fails to
`explain even what these documents constitute and why they include useful
`information. We require more than a high level assertion to meet the
`rigorous “interests of justice” standard.
`Patent Owner also argues that Petitioners “have an obligation to
`produce information inconsistent with their positions under 37 CFR
`§ 42.51(b)(iii).” Mot. 4. Rule 42.51(b)(iii), however, relates to routine
`discovery, not additional discovery, and Patent Owner did not seek
`authorization for a motion to compel routine discovery.7
`Patent Owner also argues that we must consider secondary
`considerations in inter partes review proceedings. Mot. 4. Although we
`agree that an analysis of any contention that a claim is unpatentable as
`obvious must consider, if in the record, evidence of secondary
`considerations, such a requirement does not compel us to grant any motion
`for additional discovery that allegedly is directed to evidence of secondary
`considerations. The AIA statute, our rules, and binding precedent requires
`the moving party to show that any additional discovery is in the interests of
`justice.
`
`
`7 Even if we interpret Patent Owner’s Motion as a motion to compel routine
`discovery, Patent Owner fails to adequately allege how the information is
`inconsistent with a position taken by Petitioners.
`
`
`
`7
`
`
`
`IPR2018-00859 (Patent 9,211,018 B2)
`IPR2018-00870 (Patent 7,246,394 B2)
`IPR2018-00871 (Patent 7,246,394 B2)
`IPR2018-00872 (Patent 7,246,394 B2)
`IPR2018-00873 (Patent 7,246,394 B2)
`IPR2018-00874 (Patent 7,246,394 B2)
`IPR2018-00875 (Patent 7,346,950 B2)
`
`
`Garmin Factor 2 – Litigation Positions and Underlying Basis
`“Asking for the other party’s litigation positions and the underlying
`basis for those positions is not necessary in the interest of justice.”
`IPR2012-00001, Paper 26 at 6. We find that this factor weighs in favor of
`Patent Owner’s request. As both parties indicate, the parallel district court
`litigation has settled. See Mot. 8; Opp. 4. Petitioners do not address this
`factor. See Opp. 9–10.
`Garmin Factor 3 – Ability To Generate Equivalent Information By Other
`Means
`“Information a party can reasonably figure out or assemble without a
`discovery request would not be in the interest of justice to have produced by
`the other party.” IPR2012-00001, Paper 26 at 6. We find that this factor
`weighs against Patent Owner’s request.
`In support of this factor, Patent Owner contends that the requested
`documents “relate to Petitioners’ and real-party-in-interest Coleman’s
`internal confidential information, including internal analysis, perceptions,
`market research and sales data.” Mot. 8. Patent Owner fails to even allege
`(let alone establish) that the requested information could not reasonably be
`obtained by other means, such as by its own market research. Nor does
`Patent Owner explain sufficiently why the requested information is
`necessary to support their argument directed to secondary considerations,
`rather than documents in Patent Owner’s possession. See Opp. 10 (“Patent
`Owner does not explain why its own documents are not sufficient. Patent
`
`
`
`8
`
`
`
`IPR2018-00859 (Patent 9,211,018 B2)
`IPR2018-00870 (Patent 7,246,394 B2)
`IPR2018-00871 (Patent 7,246,394 B2)
`IPR2018-00872 (Patent 7,246,394 B2)
`IPR2018-00873 (Patent 7,246,394 B2)
`IPR2018-00874 (Patent 7,246,394 B2)
`IPR2018-00875 (Patent 7,346,950 B2)
`
`Owner is a manufacturer of products it contends practice the patent at
`issue.”).
`Moreover, Patent Owner’s request includes two pleadings in the
`Litigation that were filed under seal—docket entries 324 and 325. Patent
`Owner fails to explain why the publicly available redacted versions of these
`pleadings (docket entries 339 and 340) would not provide the necessary
`information. Also, one of the requested documents includes a Bates number
`beginning “TWW,” indicating that it is one of Patent Owner’s produced
`documents. Patent Owner fails to explain why it needs Petitioners to
`produce one of Patent Owner’s own documents.
`Garmin Factors 4 and 5 – Easily Understandable Instructions and Requests
`Not Overly Burdensome To Answer
`“The questions should be easily understandable” and “not be overly
`burdensome to answer.” We find that these factors weigh in favor of Patent
`Owner’s request. Patent Owner’s request identifies the Bates number of
`each requested document or a specific citation to a deposition and the
`requested documents have already been produced in the Litigation. Mot. 8–
`9. Petitioners do not address these factors. See Opp. 9–10.
`Conclusion
`In weighing the Garmin factors, we determine that Patent Owner has
`not satisfied its burden and its motion for additional discovery is denied.
`Also, Patent Owner’s request to file a Reply to Petitioners’ Opposition is
`
`
`
`9
`
`
`
`IPR2018-00859 (Patent 9,211,018 B2)
`IPR2018-00870 (Patent 7,246,394 B2)
`IPR2018-00871 (Patent 7,246,394 B2)
`IPR2018-00872 (Patent 7,246,394 B2)
`IPR2018-00873 (Patent 7,246,394 B2)
`IPR2018-00874 (Patent 7,246,394 B2)
`IPR2018-00875 (Patent 7,346,950 B2)
`
`denied, as the arguments that Patent Owner sought to address in the Reply
`would not remedy the issues discussed above.
`Patent Owner’s motion is denied without prejudice. Patent Owner
`may renew its motion by filing a brief, not to exceed 10 pages, consistent
`with our decision here. We do not put a time limit on such a filing at this
`time because, prior to refiling at the Board, Patent Owner may wish to seek
`relief or clarification in the district court as to the Protective Order there.
`We do remind Patent Owner, however, of the looming deadlines for the
`Patent Owner Responses in these inter partes review proceedings.
`
`
`MOTION FOR AUTHORIZATION TO COMPEL DISCOVERY
`Patent Owner seeks authorization to apply for a subpoena to compel
`Coleman Company Inc., a non-party to the inter partes review proceedings,
`to produce certain documents. Mot. 9–10. For much the same reasons as
`described above, we determine that Patent Owner has failed to make the
`requisite showing that such discovery is in the interests of justice.
`Patent Owner has failed to explain adequately how the requested
`information would tend to show beyond speculation that something useful
`will be uncovered from these documents.
`
`In consideration of the foregoing, it is hereby:
`ORDERED that Patent Owner’s motion for additional discovery is
`denied without prejudice;
`
`
`
`10
`
`
`
`IPR2018-00859 (Patent 9,211,018 B2)
`IPR2018-00870 (Patent 7,246,394 B2)
`IPR2018-00871 (Patent 7,246,394 B2)
`IPR2018-00872 (Patent 7,246,394 B2)
`IPR2018-00873 (Patent 7,246,394 B2)
`IPR2018-00874 (Patent 7,246,394 B2)
`IPR2018-00875 (Patent 7,346,950 B2)
`
`
`FURTHER ORDERED that Patent Owner’s request to file a Reply to
`Petitioners’ Opposition is denied;
`FURTHER ORDERED that Patent Owner’s motion for authorization
`to compel discovery is denied without prejudice;
`FURTHER ORDERED that Patent Owner is authorized to renew its
`motion for additional discovery and motion to compel discovery by filing a
`motion not to exceed 10 pages; and
`FURTHER ORDERED that Petitioners are authorized to file an
`opposition to any renewed motion, not to exceed 10 pages, due one (1) week
`following the filing of Patent Owner’s renewed motion.
`
`
`
`
`
`
`
`
`
`
`
`11
`
`
`
`IPR2018-00859 (Patent 9,211,018 B2)
`IPR2018-00870 (Patent 7,246,394 B2)
`IPR2018-00871 (Patent 7,246,394 B2)
`IPR2018-00872 (Patent 7,246,394 B2)
`IPR2018-00873 (Patent 7,246,394 B2)
`IPR2018-00874 (Patent 7,246,394 B2)
`IPR2018-00875 (Patent 7,346,950 B2)
`
`PETITIONERS:
`
`Brent A. Hawkins (lead counsel)
`Hersh H. Mehta
`Krista Vink Venegas (pro hac vice)
`MORGAN, LEWIS & BOCKIUS LLP
`brent.hawkins@morganlewis.com
`hersh.mehta@morganlewis.com
`krista.venegas@morganlewis.com
`Bestway-Intex-PTAB@morganlewis.com
`
`R. Trevor Carter
`Andrew M. McCoy
`FAEGRE BAKER DANIELS LLP
`Trevor.Carter@faegrebd.com
`Andrew.McCoy.PTAB@faegrebd.com
`(Counsel for Intex)
`
`David M. Tennant
`Nathan Zhang
`Allen Wang
`WHITE & CASE LLP
`dtennant@whitecase.com
`nathan.zhang@whitecase.com
`allen.wang@whitecase.com
`(Counsel for Walmart)
`
`Alexander Ott
`aott@mwe.com
`Brian Jones
`bajones@mwe.com
`
`
`
`
`
`
`
`12
`
`
`
`IPR2018-00859 (Patent 9,211,018 B2)
`IPR2018-00870 (Patent 7,246,394 B2)
`IPR2018-00871 (Patent 7,246,394 B2)
`IPR2018-00872 (Patent 7,246,394 B2)
`IPR2018-00873 (Patent 7,246,394 B2)
`IPR2018-00874 (Patent 7,246,394 B2)
`IPR2018-00875 (Patent 7,346,950 B2)
`
`PATENT OWNER:
`
`Timothy E. Bianchi (lead counsel)
`Thomas C. Reynolds
`Domenico Ippolito
`SCHWEGMAN, LUNDBERG & WOESSNER, P.A.
`tbianchi@slwip.com
`treynolds@slwip.com
`dippolito@slwip.com
`
`Ronald Wielkopolski
`Amadou K. Diaw
`Robert M. Harkins
`RUYAKCHERIAN LLP
`ronw@ruyakcherian.com
`amadoukd@ruyakcherian.com
`bobh@ruyakcherian.com
`
`
`
`
`
`13
`
`
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