`571-272-7822
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` Paper: 25
` Filed: May 26, 2020
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`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`INTEL CORPORATION,
`Petitioner,
`
`v.
`
`TELA INNOVATIONS, INC.,
`Patent Owner.
`
`
`
`
`
`
`
`
`
`
`IPR2019-01636 (Patent 10,141,334 B2)
` IPR2019-01637 (Patent 10,141,335 B2)1
`
`
`
`
`Before JO-ANNE M. KOKOSKI, KRISTINA M. KALAN, AND
`WESLEY B. DERRICK, Administrative Patent Judges.
`
`KALAN, Administrative Patent Judge
`
`ORDER
`Granting Patent Owner’s Motion for Additional Discovery
`37 C.F.R. § 42.51(b)(2)
`
`
`1 The parties are not authorized to use this style heading for any subsequent
`papers.
`
`
`
`IPR2019-01636 (Patent 10,141,334 B2)
`IPR2019-01637 (Patent 10,141,335 B2)
`
`
`Pursuant to our authorization, Tela Innovations, Inc. (“Patent Owner”)
`filed a Motion for Additional Discovery in the instant proceedings, and Intel
`Corporation (“Petitioner”) filed an Opposition.2,3 Patent Owner seeks
`additional discovery related to objective indicia of nonobviousness, i.e.,
`commercial success and copying. Mot. 1. Specifically, Patent Owner
`requests:
`1. The most current infringement contentions served by Patent
`Owner in the NDCA Action4 relating to the ’334 Patent and
`the documents cited therein.
`2. Documents sufficient to show the sales of the Subject
`Products5 from first sale to the present, which information
`could be obtained from sales documents produced by
`Petitioner in the NDCA Action or by Petitioner’s provision
`of sales summary chart.
`Id. at 2. After considering the arguments, evidence, and facts of the cases
`before us, we determine that it is in the interest of justice to grant Patent
`
`
`2 See IPR2019-01636, Papers 21 (authorizing filing of the Motion), 23
`(“Mot.”), and 24 (“Opp.”); IPR2019-01637, Papers 21, 23, 24. Although the
`analysis herein applies to both proceedings, we refer to the papers and
`exhibits filed in IPR2019-01636 for convenience.
`3 Petitioner submitted new exhibits with its Opposition. See IPR2019-
`01636, Exs. 1029–1036; IPR2019-001637, Exs. 1030–1037. In our Order
`authorizing Patent Owner’s Motion, we stated that “[n]o additional evidence
`is authorized with any of the filings.” Paper 21, 3. Accordingly, the exhibits
`filed by Petitioner in support of its Opposition will be expunged.
`4 “NDCA Action” refers to Intel Corp. v. Tela Innovations, Inc., Case
`No. 18-cv-02848-WHO (N.D.Ca.). Mot. App. A at 2.
`5 “Subject Products” refers to “Petitioner’s microprocessor or printed circuit
`board product lines identified in Tela’s Disclosure of Asserted Claims and
`Infringement Contentions with Respect to Plaintiff Intel Corp. relating to
`the ’334 patent (“Infringement Contentions”), already produced or served in
`the” NDCA Action. Mot. App. A at 2.
`
`2
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`IPR2019-01636 (Patent 10,141,334 B2)
`IPR2019-01637 (Patent 10,141,335 B2)
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`Owner’s Motion. For the reasons that follow, Patent Owner’s Motion is
`granted.
`
`Analysis
`In an inter partes review, a party seeking discovery beyond what is
`expressly permitted by rule must do so by motion, and must show that such
`additional discovery is “necessary in the interest of justice.” 35 U.S.C.
`§ 316(a)(5); see 37 C.F.R. § 42.51(b)(2)(i). Patent Owner, as the movant,
`bears the burden of demonstrating that it is entitled to the additional
`discovery sought. 37 C.F.R. § 42.20(c). We consider the five factors set
`forth in Garmin Int’l, Inc. v. Cuozzo Speed Techs. LLC, IPR2012-00001,
`Paper 26 (PTAB March 5, 2013) (precedential) in determining whether
`additional discovery is necessary in the interest of justice. The five Garmin
`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 means; (4) whether the moving party has provided
`easily understandable instructions; and (5) whether the requests are overly
`burdensome. Id.
`A. Garmin Factor 1: Useful Information
`The first Garmin factor asks whether the party seeking additional
`discovery demonstrates more than “[t]he mere possibility of finding
`something useful, and mere allegation something useful will be found.”
`Garmin, Paper 26 at 6. “The party requesting discovery should already be in
`possession of evidence tending to show beyond speculation that in fact
`something useful will be uncovered.” Id. “Useful” in this context means
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`IPR2019-01636 (Patent 10,141,334 B2)
`IPR2019-01637 (Patent 10,141,335 B2)
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`“favorable in substantive value to a contention of the party moving for
`discovery,” not just “relevant” or “admissible.” Id. at 7. A good cause
`showing requires the moving party to provide a specific factual reason for
`reasonably expecting that the discovery will be “useful.”
`Patent Owner argues that the requested discovery will show that the
`Subject Products are commercially successful. Mot. 3–6. To demonstrate
`nonobviousness based on commercial success, a patent owner must provide
`evidence of both commercial success and a nexus between that success and
`the merits of the claimed invention. See Fox Factory Inc. v. SRAM, LLC,
`944 F.3d 1366, 1373 (Fed. Cir. 2019).
`Patent Owner contends that “Petitioner has made public comments
`indicating general commercial success of” its Subject Products (e.g.,
`Petitioner’s 14nm Processors and 10nm Processors), and that “Petitioner’s
`products have been recognized in the industry as successful and described as
`‘game-chang[ing]’ technology.” Mot. 3. Patent Owner contends that
`“Petitioner’s PC Client Group operating segment, which includes the
`production, marketing, and sales of Petitioner’s 14nm Processors, has
`consistently represented the majority of revenue for Petitioner,” and notes
`that Petitioner’s net revenue in 2014 was $55,870,000,000. Id. at 4.
`According to Patent Owner, because “public information indicates that the
`Subject Products are coextensive with the claims of the ’334 Patent, there is
`a presumed nexus between those products’ commercial success and the
`claimed invention.” Id. at 6.
`Petitioner responds that “Patent Owner did not allege secondary
`considerations in its Preliminary Response,” that “Patent Owner has not
`alleged secondary considerations of non-obviousness in [the NDCA Action],
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`IPR2019-01636 (Patent 10,141,334 B2)
`IPR2019-01637 (Patent 10,141,335 B2)
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`where fact discovery is now closed,” and that “Patent Owner’s failure to do
`so undermines its assertion that the documents sought relate to ‘evidence of
`non-obviousness.’” Opp. 1–2. We disagree. A patent owner is not required
`to file a preliminary response, and, even if one is filed, the Board may
`decline to consider arguments made in the preliminary response unless they
`are raised in the patent owner response. See 37 C.F.R. § 42.107(b) (“A
`patent owner may expedite the proceeding by filing an election to waive the
`patent owner preliminary response.”); In re Nuvasive, Inc., 842 F.3d 1376,
`1381 (Fed. Cir. 2016) (explaining that a patent owner waives an issue
`presented in its preliminary response if it fails to renew the issue in its
`response after trial is instituted). Patent Owner’s arguments (or lack thereof)
`in its Preliminary Responses are not relevant to whether the requested
`discovery relates to evidence of non-obviousness.
`Moreover, Petitioner does not explain why Patent Owner’s choice to
`not allege objective indicia of non-obviousness in the NDCA Action
`“undermines its assertion that the documents sought relate to ‘evidence of
`non-obviousness.’” Opp. 1. Based on the record before us, we are not
`convinced that arguments that Patent Owner is (or is not) pursuing in the
`NDCA Action should inform our decision as to whether the requested
`discovery would be useful in these proceedings.
`Petitioner also argues that “Patent Owner has not made the requisite
`showing of nexus.” Opp. 3. Petitioner argues that although “Patent Owner
`describes its alleged invention as directed to a one-dimensional layout
`whereby ‘features in a given layer of the integrated circuit [] have
`rectangular shapes [] with their lengths oriented in the same direction,’” the
`documents to which Patent Owner cites to show commercial success of the
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`IPR2019-01636 (Patent 10,141,334 B2)
`IPR2019-01637 (Patent 10,141,335 B2)
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`Subject Products do not mention one-dimensional layout, or linear or
`rectangular shaped features. Id. According to Petitioner, the cited
`documents credit other features of the Subject Products for their commercial
`success, such as power efficiency, performance, and small chip size. Id.
`at 3–4.
`“[P]resuming nexus is appropriate ‘when the patentee shows that the
`asserted objective evidence is tied to a specific product and that product
`“embodies the claimed features, and is co-extensive with them.”’” Fox
`Factory, 944 F.3d at 1373 (quoting Polaris Indus., Inc. v. Arctic Cat, Inc.,
`882 F.3d 1056, 1072 (Fed. Cir. 2018) (quoting Brown & Williamson
`Tobacco Corp. v. Philip Morris Inc., 229 F.3d 1120, 1130 (Fed. Cir.
`2000))). The initial claim chart filed in the NDCA Action (based solely on
`publicly available information) suggests that all of the claim elements of at
`least independent claim 1 are present in at least one of the Subject Products.
`If established at trial, this might entitle Patent Owner to a presumption of
`nexus. Petitioner can, however, attempt to rebut any such presumption at
`trial by presenting evidence that shows that any commercial success was due
`to factors other than the patented invention, such as unclaimed features,
`marketing, or features known in the prior art. See id. at 1373–74.
`Petitioner’s argument here raises some of these potential rebuttal points on
`the issue of nexus, if it were to be established, but it is premature on this
`record for us to decide the merits of such points at this stage.
`For these reasons, we find that Garmin factor 1 weighs in favor of
`granting Patent Owner’s Motion.
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`IPR2019-01636 (Patent 10,141,334 B2)
`IPR2019-01637 (Patent 10,141,335 B2)
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`B. Garmin Factors 2 and 4: Litigation Positions and Easily
` Understandable Instructions
`Garmin factor 2 asks whether the requests seek the other party’s
`litigation positions and the underlying basis for those positions. Garmin,
`Paper 26 at 6 (“Asking for the other party’s litigation positions and the
`underlying basis for those positions is not necessary in the interests of
`justice.”). Garmin factor 4 requires that the additional information sought
`“should be easily understandable.” Id. Patent Owner argues that the
`requested discovery “seeks only factual information,” and that “the
`instructions are straightforward.” Mot. 6–7. Petitioner does not address
`either of these factors. See generally Opp. We find that Garmin factors 2
`and 4 weigh in favor of granting Patent Owner’s Motion.
`C. Garmin Factor 3: Ability to Generate Equivalent Information
`“Information a party can reasonably figure out or assemble without a
`discovery request would not be in the interests of justice to have produced
`by the other party.” Garmin, Paper 26 at 6 (Garmin factor 3). Patent Owner
`argues that the requests “narrowly target non-public information.” Mot. 7.
`Petitioner argues that “Patent Owner already has access to equivalent non-
`confidential information.” Opp. 6. In particular, Petitioner notes that the
`claim chart Patent Owner filed in the NDCA Action, “which is 49 pages
`long, is based solely on publicly available information.” Id. According to
`Petitioner, the “additional discovery of highly confidential infringement
`contentions” “constitute[s] mere allegations, not proof, of infringement, and
`the confidential information adds nothing because the Board will not
`determine infringement.” Id.
`As noted above, demonstrating commercial success requires a
`showing that the relevant products are coextensive with the challenged
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`IPR2019-01636 (Patent 10,141,334 B2)
`IPR2019-01637 (Patent 10,141,335 B2)
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`claims. Fox Factory, 944 F.3d at 1373–74. Although Patent Owner
`contends that “public information indicates that the Subject Products are co-
`extensive with the claims of the ’334 Patent,” it also contends that the public
`information is limited, and detailed information is “available only in
`Petitioner’s confidential documents.” Mot. 6. It is reasonable to assume, on
`this record, that the most current infringement contentions served by Patent
`Owner in the NDCA Action contain citations to non-public information
`from Petitioner that could be useful to fill in gaps in technical details
`supplied in the public information. See Assoc. British Foods PLC v. Cornell
`Research Foundation, Inc., IPR2019-00577, Paper 44 at 9 (PTAB Oct. 4,
`2019).
`Petitioner also argues that “Patent Owner’s motion shows that it is
`able to quantify sales information of the Subject Products to support an
`assertion of commercial success from publicly available sources.” Opp. 7.
`Petitioner represents that it “will not dispute that public sales information for
`purposes of these proceedings.” Id. The publicly available sales
`information Patent Owner relies on in its Motion, however, is general in
`nature. See Mot. 3–5. Only Petitioner possesses sales data for the Subject
`Products, so Patent Owner here, as in Garmin, cannot “reasonably figure out
`or assemble [the information] without a discovery request.” Garmin,
`Paper 26 at 6.
`Accordingly, we determine that Garmin factor 3 weighs in favor of
`granting Patent Owner’s motion.
`D. Garmin Factor 5: Whether the Requests are Overly Burdensome
`Garmin factor 5 requires that “[t]he requests must not be overly
`burdensome to answer, given the expedited nature of Inter Partes Review[,]
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`. . . includ[ing] financial burden, burden on human resources, and burden on
`meeting the time schedule.” Garmin, Paper 26 at 7. Patent Owner argues
`that the requested discovery is not overly burdensome because the requests
`can be satisfied: (1) by Petitioner providing consent to Patent Owner to use
`the most current infringement contentions in the NDCA Action in these
`proceedings; and (2) by Petitioner providing consent to use sales data
`produced in the NDCA Action in these proceedings; or (c) by Petitioner
`providing a sales summary chart. Mot. 7.
`Petitioner argues that the infringement contentions in the NDCA
`Action and many of the documents cited therein “are classified as ‘Outside
`Counsel Restricted – Source Code’ under the NDCA Protective Order
`because they contain Petitioner’s highly confidential technical information.”
`Opp. 6. Petitioner contends that “[i]njecting highly confidential but
`irrelevant ‘source code’ information into the IPR proceedings wastes judicial
`resources” and “would require negotiating and implementing complex
`confidentiality protections in the instant proceedings.” Id. at 7. Petitioner
`further contends that this “would impose an unnecessary burden on the
`Board and the parties to ensure that the information is properly
`safeguarded,” and “creates undue risks that Petitioner’s confidential
`information may be inadvertently disclosed, which would irreparably harm
`Petitioner.” Id.
`On its face, the effort to produce the requested discovery appears
`fairly low. As Patent Owner points out, the requested discovery is already
`available to Patent Owner in the NDCA Action, and could be used in these
`proceedings simply through Petitioner’s consent. Mot. 7. We are mindful of
`the burden on the parties and the Board with respect to the use of
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`IPR2019-01636 (Patent 10,141,334 B2)
`IPR2019-01637 (Patent 10,141,335 B2)
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`Petitioner’s source code in these proceedings, which is designated as highly
`confidential with highly-restricted access in the NDCA Action. We are
`granting Patent Owner’s Motion in large part, however, because it seeks
`specific, defined documents that have already been exchanged in the NDCA
`Action, the contents of which Patent Owner alleges support its commercial
`success arguments. Moreover, because the parties have already negotiated a
`protective order in the NDCA Action, Petitioner’s argument that production
`of such documents “would require negotiating and implementing complex
`confidentiality protections in the instant proceedings” rings hollow. We
`direct the parties to the Consolidated Trial Practice Guide for guidance on
`the procedures for filing motions to seal and protective orders in these
`proceedings in the event either party seeks to submit confidential
`information to the Board. See Consolidated Trial Practice Guide, 19–22.
`Accordingly, we determine that Garmin Factor 5 weighs in favor of
`granting Patent Owner’s Motion.
`Conclusion
`After weighing the Garmin factors, we determine that Patent Owner
`has shown that discovery of the requested materials is in the interest of
`justice.
`
`Order
`In consideration of the foregoing, it is hereby
`ORDERED that Patent Owner’s Motion for Additional Discovery is
`granted; and
`FURTHER ORDERED that Exhibits 1029–1036 in IPR2019-01636
`and Exhibits 1030–1037 in IPR2019-01637 are expunged.
`
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`IPR2019-01636 (Patent 10,141,334 B2)
`IPR2019-01637 (Patent 10,141,335 B2)
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`FOR PETITIONER:
`
`Todd Friedman
`Todd.friedman@kirkland.com
`
`Gregory Arovas
`Greg.arovas@kirkland.com
`
`F. Christopher Mizzo
`Chris.mizzo@kirkland.com
`
`Bao Nguyen
`bnguyen@kirkland.com
`
`FOR PATENT OWNER:
`
`Gunnar Leinberg
`leinberg@pepperlaw.com
`
`Bryan Smith
`smithbc@pepperlaw.com
`
`Nicholas Gallo
`gallon@pepperlaw.com
`
`
`
`
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