[00:00:00] Speaker 01: I thought that was going to be a swift argument. [00:00:03] Speaker 01: May it please the court. [00:00:05] Speaker 01: My name is Mike Maza. [00:00:06] Speaker 01: I represent plaintiff, appellant, ABT systems. [00:00:10] Speaker 01: We've raised two issues on appeal. [00:00:13] Speaker 01: Your Honor's marking and damages. [00:00:15] Speaker 01: Unless the court suggests otherwise, I was going to start with marking. [00:00:22] Speaker 01: I think it's appropriate to look at the standard. [00:00:24] Speaker 01: The Eighth Circuit, this trial came out of St. [00:00:27] Speaker 01: Louis. [00:00:27] Speaker 01: The Eighth Circuit standard says that [00:00:30] Speaker 01: A judgment as a matter of law should not be granted unless the evidence points all one way or unswervingly one way. [00:00:39] Speaker 01: We would respectfully suggest that that was not the case here. [00:00:43] Speaker 01: There were nine licenses that ABT entered into that required marking. [00:00:49] Speaker 01: There was one that did not require marking. [00:00:53] Speaker 01: One which was 40 percent of the sales at least, right? [00:00:59] Speaker 01: The cross upon has suggested that it could have been your honor, but there's no actual evidence in the record that any of those sales were made after the license agreement was settled. [00:01:10] Speaker 01: In fact, um, if your honor would, I'm sorry, I didn't understand your statement. [00:01:15] Speaker 05: None of those sales were made after the license agreement was settled. [00:01:20] Speaker 01: Yes, I'm sorry. [00:01:21] Speaker 01: I misspoke. [00:01:21] Speaker 01: There was a, there was a lawsuit in 2002 for sales from 2000 to 2002. [00:01:29] Speaker 01: and in March of 2003, that lawsuit was settled by a settlement agreement. [00:01:34] Speaker 01: And any sales after that license agreement, dated March 2003, were projected sales only. [00:01:41] Speaker 01: There's no evidence in the record of any actual sales. [00:01:44] Speaker 01: And Emerson admits that the March 2003... What was your evidence of marking that you said was sufficient? [00:01:53] Speaker 01: Okay. [00:01:54] Speaker 01: So nine license agreements, so it's a rural reason [00:01:57] Speaker 01: substantial compliance standard. [00:02:00] Speaker 01: There were nine license agreements that required marking. [00:02:02] Speaker 01: We delineated that in the blue. [00:02:04] Speaker 02: But the license agreements alone are not enough under our law, isn't that correct? [00:02:09] Speaker 02: Well, there was... Let's assume just for purposes of argument, if you had a case and you said, my evidence of marking are nine licenses that require marking, period, I have nothing else. [00:02:20] Speaker 02: Right. [00:02:20] Speaker 02: You wouldn't be able to withstand a summary judgment, would you? [00:02:24] Speaker 01: I don't know, Your Honor. [00:02:26] Speaker 01: When third parties are involved, I know it's not. [00:02:31] Speaker 02: I mean, you're assuming that the existence of the license is circumstantial evidence that the licensee behaved? [00:02:40] Speaker 01: Correct. [00:02:40] Speaker 02: Why is that inference that is reasonable? [00:02:45] Speaker 01: Well, I don't think it's unreasonable because it would be a breach of the contract and subject to a lawsuit if they didn't comply. [00:02:51] Speaker 01: But we're certainly not taking a position [00:02:54] Speaker 01: that it was license agreements alone that was in evidence. [00:02:57] Speaker 01: I mean, that was, I think, way the evidence here that all nine out of the ten were required. [00:03:02] Speaker 02: So beyond, I'm sorry, I interrupted your answer for the chief. [00:03:07] Speaker 01: No, not at all. [00:03:09] Speaker 01: So beyond that. [00:03:09] Speaker 02: What is there beyond the nine licenses? [00:03:12] Speaker 01: Right. [00:03:12] Speaker 01: So beyond that, we had unrebutted testimony from the inventor Armand Rudd. [00:03:17] Speaker 01: He was a very visible industry consultant. [00:03:20] Speaker 01: He went to numerous annual trade shows. [00:03:24] Speaker 01: He policed the internet. [00:03:27] Speaker 02: Did he testify that when he went to the trade shows, he walked up and down and looked at the boots and inspected the product of the licensees to ascertain whether they were marked? [00:03:38] Speaker 01: He did testify that when he was at the shows, he was looking for a market. [00:03:42] Speaker 01: And that's at A5193 to A5195. [00:03:48] Speaker 01: He did testify that he obtained [00:03:50] Speaker 01: He observed marking on his samples of licensed products at those shows. [00:03:56] Speaker 05: These were annual trade shows, so is there testimony as to how many of these he went to and how many products he observed? [00:04:02] Speaker 01: He did testify that at least once annually, but typically more than that at these shows. [00:04:10] Speaker 01: So he was at one show? [00:04:11] Speaker 02: He testified that typically more. [00:04:13] Speaker 02: I remember him testifying at least annually, but I don't remember that typically. [00:04:17] Speaker 02: You just said typically more than annually. [00:04:25] Speaker 01: I may stand corrected. [00:04:27] Speaker 01: One second here. [00:04:30] Speaker 02: My memory is a little bit vague on this, so I'm not trying to suggest that you were incorrect. [00:04:40] Speaker 01: I asked him, how about trade shows? [00:04:42] Speaker 01: Do you go to trade shows? [00:04:43] Speaker 01: Answer, yes, I do. [00:04:44] Speaker 01: How often? [00:04:45] Speaker 01: Typically once a year, at least once a year. [00:04:48] Speaker 01: Is that something you look for or not? [00:04:49] Speaker 01: Yes. [00:04:50] Speaker 01: For the ones that are at the trade shows, I would look, for instance, [00:04:52] Speaker 02: That would be at least once a year, not necessarily more than once a year. [00:04:57] Speaker 01: At least once a year is fair. [00:05:00] Speaker 01: I stand corrected. [00:05:02] Speaker 01: And we also have, I've given to the clerk, we did give samples of physical marked license products that were brought to the trial. [00:05:11] Speaker 01: And we also have evidence that Mr. Rudd came forward and he said, this was not at Emerson's prompting, this was Mr. Rudd on his own saying, [00:05:20] Speaker 01: I had one unexcused problem with Benmar. [00:05:26] Speaker 01: I had a dispute with RPC, and they pulled product off the shelf, marked it, put it back on the product. [00:05:33] Speaker 01: So there was evidence that Mr. Rudd was monitoring this. [00:05:38] Speaker 01: And it wasn't just a situation where he just relied on the license agreements. [00:05:48] Speaker 01: I think it's important to recognize too that Emerson presented no contrary evidence. [00:05:54] Speaker 01: And I think it's also useful to realize that Honeywell is, you know, this multi-billion dollar company had a bargaining position with Emerson, with ABT, that little ABT self-proprietorship didn't have. [00:06:08] Speaker 01: It would be, it was difficult for ABT to insist that Honeywell mark in the first license agreement. [00:06:15] Speaker 01: So again, it's a reasonable rule of compliance. [00:06:18] Speaker 02: These are the issues that you're arguing now are going to be mooted if we agree with the cross appellant on the validity issue, right? [00:06:26] Speaker 01: Yes, Your Honor. [00:06:28] Speaker 02: I take that as a... I notice you've reserved five minutes of your time, but... I did, Your Honor. [00:06:36] Speaker 02: That's all the time you'll have to address the validity issue, right? [00:06:40] Speaker 01: Am I done with my ten? [00:06:41] Speaker 02: I'm looking... No, you've got eight minutes. [00:06:45] Speaker 05: Okay. [00:06:47] Speaker 05: The clock started at 15. [00:06:51] Speaker 01: Oh, thank you. [00:06:52] Speaker 01: Appreciate it. [00:06:53] Speaker 01: Okay, so just very quickly on the hearsay rule and then I'll get to validity. [00:07:00] Speaker 01: The court, the one point I wanted to make here is that the court at A50, sorry, A5, [00:07:15] Speaker 01: to 5665 clearly made a hearsay exclusionary rule under 8036 based on the timing issue. [00:07:27] Speaker 01: In other words, the court said, it appeared to me that the court said solely because the licensee records were created after the lawsuit started, that alone kicked them out of the hearsay exclusionary rule. [00:07:43] Speaker 01: And we would suggest that that is not the law. [00:07:47] Speaker 01: And because the evidence demonstrated that Mr. Rudd relied on the marking in his ordinary course of business, that would be sufficient. [00:07:57] Speaker 01: Well, what's the standard of review with respect to this hearsay? [00:08:01] Speaker 01: Well, we believe it's a de novo standard, Your Honor, because this is a legal issue under 8036. [00:08:09] Speaker 01: Now, if it was a pure fact... Is this an evidentiary ruling? [00:08:13] Speaker 01: If it was a pure evidentiary ruling, it would be an abuse of discretion, but we believe the court made a legal error on saying that 8036 doesn't apply because of the timing issue. [00:08:25] Speaker 01: We think, as a matter of law, that was incorrect. [00:08:32] Speaker 01: I'm just going to switch to validity, if that's okay. [00:08:36] Speaker 01: the standard for validity, legally sufficient evidentiary basis. [00:08:42] Speaker 01: We start with this idea that there was a thermostat paradigm, namely that there was unrebutted testimony, for example, A5098, that prior thermostats had an on-off switch, a system switch, to turn the heating and cooling on and off, and they had a separate fan switch. [00:09:02] Speaker 01: On, on, or off. [00:09:03] Speaker 00: Mr. Mazza, the sole issue really on [00:09:06] Speaker 00: validity is whether references can be combined, correct? [00:09:10] Speaker 00: I think that's fair. [00:09:12] Speaker 01: And so with that factual predicate in mind, what was lacking in the prior art was this idea of coordination or linking of the system switch with the fan switch. [00:09:23] Speaker 01: So there wasn't a teaching of control logic, and that was the paradigm shift that Mr. Rudd had talked about and some of the witnesses had talked about. [00:09:33] Speaker 01: We call that trial a smart feature, but the idea was there had to be some electronic linking of logic control between the system switch and the fan off-on switch, and current thermostat didn't have that. [00:09:48] Speaker 02: In fact... Is control logic a claim limitation? [00:09:52] Speaker 01: Not explicitly, but it is in the sense that the fan recycle control feature inherently requires that. [00:10:00] Speaker 02: Right. [00:10:00] Speaker 02: Can't your claim be infringed without logic control? [00:10:04] Speaker 01: I don't think so, Your Honor. [00:10:05] Speaker 01: Why not? [00:10:06] Speaker 01: Because the fan recycle feature inherently must work in tandem with the system switch. [00:10:13] Speaker 01: Because the fan recycle feature says turn the fan on, excuse me, turn the cooling, when the cooling system goes on or off, pause, and then turn the fan on. [00:10:25] Speaker 01: So there has to be some coordination between the system and the fan switch. [00:10:31] Speaker 05: I'm new into your rebuttal, so why don't we hear from the other side. [00:10:34] Speaker 05: Thank you. [00:10:35] Speaker 04: Good morning. [00:10:46] Speaker 04: May it please the court? [00:10:54] Speaker 04: Because of finding that the 017 patent is obvious as dispositive of the entire case, [00:10:59] Speaker 04: I will deal with that issue first and then I will follow it with the damages and marking issues that have been raised by counsel for ABT. [00:11:08] Speaker 04: The patent in this case is exactly what the Supreme Court in KSR said is obvious and that is an arrangement of old elements with each performing the same function that has been known to perform that yields no more than one would expect from such an arrangement. [00:11:26] Speaker 04: I have some charts here that were used during the trial to talk about how they work. [00:11:33] Speaker 04: It's a very simple product. [00:11:35] Speaker 04: This is Mr. Rudd, 017M. [00:11:37] Speaker 04: When the heat or cooling, both are considered air conditioning, is on, for all thermostats, the fan has to be on simply to avoid the problem. [00:11:46] Speaker 05: You said this was used? [00:11:47] Speaker 05: Was this an exhibit at Rudd? [00:11:49] Speaker 04: It was not an exhibit. [00:11:50] Speaker 04: It was a demonstrative. [00:11:51] Speaker 04: And that's really all I'm using here is just a quick explanation of how this works. [00:11:56] Speaker 05: OK. [00:11:57] Speaker 02: And then... Does your adversary object to this? [00:12:02] Speaker 01: No, Your Honor. [00:12:03] Speaker 01: It wasn't evident at the trial, but it was a lot at the dimension. [00:12:07] Speaker 04: Just that the fan then cycles on when there is no call for heating and cooling. [00:12:12] Speaker 04: So that's the empty space here. [00:12:14] Speaker 04: And in Mr. Rudd's patent, that's a pre-selected time period for the delay before the fan starts. [00:12:20] Speaker 04: So that's what that is. [00:12:26] Speaker 04: With regard to obviousness, Mr. Rudd, the inventor, testified that it was well known before his invention that the fan of a forced air HVAC system moved and circulated the air. [00:12:39] Speaker 04: That's what a fan does. [00:12:41] Speaker 04: He also testified that it was well known before his invention that when the fan ran, it mixed and circulated the air [00:12:51] Speaker 04: And then when the fan stopped running, there was no need immediately to run the fan again because the air had just been circulated. [00:12:58] Speaker 02: Didn't Dr. Siegel testify that there wouldn't have been a motivation to combine? [00:13:04] Speaker 04: Dr. Siegel's testimony on motivation to combine was a little bit curious. [00:13:11] Speaker 04: He did testify that there would be no reason to combine them. [00:13:18] Speaker 02: It's 6196, 6199, in the record where I had my slide. [00:13:26] Speaker 02: It's probably the... 6196. [00:13:45] Speaker 02: Yes, I have that, Your Honor. [00:13:47] Speaker 02: Dr. Sherman testified that Rosa Gang with Petro would render his patent obvious to agree, I do not. [00:13:53] Speaker 02: Why is that? [00:13:54] Speaker 02: Several reasons. [00:13:57] Speaker 02: He was on to testify why he believes they should not be combined. [00:14:00] Speaker 04: That's right. [00:14:01] Speaker 04: He said the big ones are the direction that you would be led by, for example, the Petro. [00:14:05] Speaker 02: So the question I want to ask you is, a jury seems to have believed [00:14:10] Speaker 02: Because all hands, including your adversary, seem to think that the prior art contains the elements of Mr. Rudd's claim. [00:14:20] Speaker 02: So case turns on combination. [00:14:23] Speaker 02: That's right. [00:14:23] Speaker 02: Well, if expert so-and-so. [00:14:26] Speaker 02: Now, Dr. Siegel wasn't impugned as an expert, right? [00:14:33] Speaker 02: He wasn't an expert. [00:14:34] Speaker 02: He was an expert. [00:14:35] Speaker 02: So the jury sits there and says, this guy knows what he's talking about. [00:14:39] Speaker 02: And he says, I wouldn't come up. [00:14:42] Speaker 02: You get a jury verdict that comes back and says claims are not obvious, has to be that they believe Dr. Siegel, right? [00:14:51] Speaker 02: Yes. [00:14:51] Speaker 02: Right. [00:14:52] Speaker 02: So what's your case? [00:14:54] Speaker 02: Sure. [00:14:54] Speaker 02: You believe in the jury system, right? [00:14:56] Speaker 02: Absolutely. [00:14:57] Speaker 02: Right. [00:14:57] Speaker 02: So your argument is that this district court judge lost his or her marbles when they sent this case to the jury because the trial judge should have disbelieved Dr. Siegel, right? [00:15:08] Speaker 02: That's your argument. [00:15:11] Speaker 02: You know, when you're arguing, JMAW means that it was wrong to send the case to the jury. [00:15:17] Speaker 02: That's correct. [00:15:18] Speaker 02: Because your JMAW before the case went to the jury is the same as your JMAW after. [00:15:24] Speaker 02: So why was this judge taking leave of his or her senses when they sent the case to the jury? [00:15:33] Speaker 02: Well, I don't think the judge was taking... Well, it's a colloquial way of saying it, but the short of the matter is, [00:15:40] Speaker 02: that you have a jury heard Dr. Siegel. [00:15:43] Speaker 02: That's right. [00:15:44] Speaker 04: And in most cases, you have experts on both sides of the case. [00:15:48] Speaker 04: But Dr. Siegel used the wrong test for enablement. [00:15:54] Speaker 04: Enablement. [00:15:54] Speaker 04: Enablement. [00:15:56] Speaker 04: That's part of the reason that he said this wasn't obvious, was that none of the prior art was enabled. [00:16:03] Speaker 04: That doesn't have to do with combining. [00:16:05] Speaker 02: And exactly, it does not have... I think everybody agrees that enablement, reference doesn't have to be enabled in order to be pertinent in a 103 analysis, right? [00:16:15] Speaker 02: That's correct. [00:16:16] Speaker 02: So I'm still talking about combination. [00:16:18] Speaker 02: Now, he gave his reasons for combining, right? [00:16:22] Speaker 02: Didn't I point you to the record? [00:16:25] Speaker 02: Yes, you did. [00:16:26] Speaker 02: Doesn't it seem like it's your burden to explain to us why the judge should have leaned over and said, Dr. Spiegel, those reasons aren't any good. [00:16:35] Speaker 02: Don't you have to convince me that those reasons aren't any good? [00:16:39] Speaker 04: Yes, I do. [00:16:40] Speaker ?: You're right. [00:16:40] Speaker 04: I have at it. [00:16:42] Speaker 04: OK. [00:16:43] Speaker 04: Looking at Dr. Seale's testimony here, he said that the direction you would be led by Patrone focuses on cooling performance. [00:16:51] Speaker 04: And that's right. [00:16:53] Speaker 04: The Patrone hand does with an air conditioning cooling system. [00:17:00] Speaker 04: It had a preselected cause. [00:17:02] Speaker 04: Before that, you wouldn't be motivated to combine that with Vogelzang, because Vogelzang dealt with healing and cooling. [00:17:11] Speaker 04: But there was no explanation as to why a thermostat that causes the fan to cycle periodically when there's no call for heating or cooling, such as Cornelius and Vogelzang. [00:17:21] Speaker 02: I didn't see any evidence in the record that you cross-examined Dr. Spiegel in the manner that you're doing right now. [00:17:30] Speaker 02: Was Dr. Stegall cross-examined? [00:17:33] Speaker 04: He was cross-examined, and I focused in the cross-examination on enablement and teaching away, which were two areas that he focused on. [00:17:42] Speaker 02: But not on his rationale for combination. [00:17:49] Speaker 02: Well, one of his... I'm sorry to be fussy about this, but it just seemed to me when your adversary, I think admirably in response to Judge Scholl, said, yeah, this is a combination case. [00:18:01] Speaker 02: So that's why I'm pushing it. [00:18:02] Speaker 04: Right. [00:18:02] Speaker 04: I think that Dr. Siegel, to a certain extent, was saying that he wouldn't combine them because Cornelius and Vogelzang and Nakatsuno, they were not enabled. [00:18:16] Speaker 04: They wouldn't work and there's no male motivation to combine something that doesn't work. [00:18:19] Speaker 04: That was one of the ways he was going. [00:18:21] Speaker 04: And so I focused in the cross on the enablement argument, which of course is that it is still useful for what it discloses. [00:18:30] Speaker 02: and on the future. [00:18:31] Speaker 02: Well, let me ask you a sort of a more refined version of what I've been talking about. [00:18:37] Speaker 02: Assume you're right that I wouldn't fault you for your cross-examination of Dr. Siegel, but here we're sitting on a case trying to decide whether the jury was entitled to leave Dr. Siegel. [00:18:51] Speaker 02: And even though Dr. Siegel may have thought the references couldn't be combined because they shouldn't have been considered in the first place because they hadn't been enabled, [00:19:00] Speaker 02: What do we do with this case where we know that the reverences were properly considered? [00:19:09] Speaker 02: Are you saying this is a case in which there's no, Dr. Spiegel didn't really have a rationale to combine beyond his enablement theory? [00:19:21] Speaker 04: Well, his enablement theory and his argument that it taught a way. [00:19:26] Speaker 04: But he used the wrong test. [00:19:27] Speaker 04: He argued that something would teach away if it didn't lead you towards the combination. [00:19:34] Speaker 04: So the fact that the Cornelius and Vogelsang patents didn't say you have to have a pause here meant that they were teaching away from the problem. [00:19:44] Speaker 02: I'm trying to define in my own mind, assuming just for purposes of argument I wanted to rule in your favor, I have to get rid of Dr. Spiegel. [00:19:53] Speaker 04: That's correct. [00:19:54] Speaker 02: I've got to get rid of him, totally get rid of him. [00:19:56] Speaker 02: So I've got to get rid of him on teaching away. [00:19:59] Speaker 02: I've got to get rid of him on enabling. [00:20:01] Speaker 02: I've got to undercut his theory of why you would combine the references, right? [00:20:07] Speaker 02: Right. [00:20:07] Speaker 02: Is there anything else that you have in your armor for undercutting Dr. Spiegel beyond your view that he's wrong on the teaching away and the enablement? [00:20:20] Speaker 04: He's wrong on both of those. [00:20:23] Speaker 04: He said that the reason, one of the big reasons you wouldn't combine them was that they had a different objective than the Rudd patent. [00:20:34] Speaker 04: But actually looking at the... Are you talking about inoperability? [00:20:38] Speaker 04: No, simply that they had a different objective in that Patrone was talking about you would pause the fan to allow the coils to cool and the water that would condense on them to drip off before you blew it back into the house. [00:20:51] Speaker 04: That was the objective of the Patrone patent. [00:20:54] Speaker 02: Is that part of the teaching away argument? [00:20:56] Speaker 04: Sort of, yeah. [00:21:00] Speaker 04: And the Rudd patent and the Vogelzang patent were talking about circulating air in the house only as often as it needed to be circulated. [00:21:09] Speaker 04: Both Dr. Siegel and Mr. Rudd, the inventor, testified that there's no need to run the fan again if it's just been run because there is [00:21:19] Speaker 04: there is, the air has been well-mixed. [00:21:21] Speaker 04: There's no hot spots, cold spots, stuffy air. [00:21:25] Speaker 04: During the call for heating and cooling, the sand is all gone. [00:21:28] Speaker 02: So right afterwards, they both admitted that there is no need to run the fan then, which is exactly what... Doesn't everybody agree, and I'll make a little pun in honor of Judge Lurie, who likes to make him, that this patent's a pretty cool idea. [00:21:41] Speaker 02: I mean, it hadn't been practiced in the art. [00:21:47] Speaker 02: Virtually everybody in the industry is using it, right? [00:21:51] Speaker 02: So aren't there secondary considerations here? [00:21:55] Speaker 04: The secondary considerations actually, Your Honor, you raise a good point about everyone using it. [00:22:03] Speaker 04: There was evidence that a number of companies had taken licenses. [00:22:10] Speaker 04: A couple of them stopped making it after they took a license. [00:22:14] Speaker 04: Emerson took it out of its product. [00:22:17] Speaker 04: And so did they put it in? [00:22:20] Speaker 04: Yes, in a very small percentage of their thermostats. [00:22:24] Speaker 04: This was dealing with just these big blue thermostats for Emerson. [00:22:31] Speaker 04: And it's like many other markets. [00:22:33] Speaker 04: If your competitor puts something in, you put it in, which is exactly what the evidence showed here. [00:22:37] Speaker 04: Honeywell had a product out that caused the fans to run that way. [00:22:42] Speaker 04: And it also had a great big touch screen on it. [00:22:45] Speaker 04: And Emerson really liked the touch screen and decided we need one of those. [00:22:48] Speaker 04: Checked the patents on that and the circulating fan. [00:22:51] Speaker 04: Came up with the Vogelzang patent, which the fees had not been paid on. [00:22:55] Speaker 04: So that was free to use. [00:22:57] Speaker 04: And Emerson believed they were using the Vogelzang patent, one of the prior art patents. [00:23:01] Speaker 04: And they went ahead with the fan. [00:23:07] Speaker 05: So that's how this happened. [00:23:09] Speaker 05: You're into your rebuttal. [00:23:10] Speaker 05: So why don't you save your rebuttal [00:23:12] Speaker 05: from the other side. [00:23:20] Speaker 01: Thank you again. [00:23:21] Speaker 01: Just two real quick points on validity. [00:23:23] Speaker 01: I think it is hard to knock down Dr. Siegel, Mr. Siegel, but I think also relying on Dr. Sherman's testimony from Emerson's technical expert is instructive. [00:23:34] Speaker 01: Dr. Sherman at A5943, line 20 through A5944, line 15, [00:23:41] Speaker 01: testified that the basic control strategy of thermostats using fans was to run the fan only during heating and cooling, the so-called auto feature. [00:23:51] Speaker 01: And then he went on to list about 10 variables that could affect fan operation. [00:23:57] Speaker 01: And he ultimately admitted that there's just, quote, too many variables making it, quote, too difficult to know a clear answer when to run the fan. [00:24:06] Speaker 01: That was at 859.44, line 16, 859.47, line 19. [00:24:11] Speaker 01: So I think the jury could have credited that testimony. [00:24:13] Speaker 02: And how does that cut? [00:24:16] Speaker 02: That's your adverse insurance expert, right? [00:24:18] Speaker 01: Correct. [00:24:19] Speaker 02: He's not saying combine the references. [00:24:22] Speaker 01: He's basically saying there's just too many variables when it comes to fan operation to know when the fan ought to be run. [00:24:31] Speaker 01: And so that's suggestive to a person. [00:24:33] Speaker 02: Why does that bear on whether or not one of ordinary customers would have been inclined to combine these references? [00:24:39] Speaker 01: Because there wasn't a clear guidance as to what to do. [00:24:44] Speaker 01: I asked him, what if you held cost, humidity, control, and energy efficiency, all give them equal weight? [00:24:51] Speaker 01: He said, it'd still be difficult to know when to operate the fan. [00:24:54] Speaker 01: There just wasn't clear guidance in the prior. [00:24:57] Speaker 01: I guess that's the point I'm making. [00:24:59] Speaker 05: On the legal points, do you agree that enablement is a question with regard to anticipation and not obviousness? [00:25:07] Speaker 01: Generally, that is the law. [00:25:10] Speaker 05: But that- Did your expert rely on the lack of enablement to support his view that there was no motivation to combine? [00:25:23] Speaker 01: I don't know if he clearly parsed that as a legal matter. [00:25:29] Speaker 01: I think it's fair to say that he gave specific reasons for each prior art reference why it was not obvious. [00:25:37] Speaker 05: And among those reasons, did that include the fact that the prior art was not enabled? [00:25:43] Speaker 01: As to two of the references, Cornelius and Nakasuno, he did find them not enabling as to the control logic. [00:25:51] Speaker 01: And I think his point was, if I could sum it up, his point was, yes, it's not enabling, but also there's no filling the gap here. [00:25:59] Speaker 01: There's no prior art reference that says, oh, here's what you should be doing from a control logic standpoint. [00:26:05] Speaker 01: As we point out in our brief, Dr. Sherman admitted that Bulgazane doesn't do that. [00:26:10] Speaker 01: In fact, if you look at the drawing of Bulgazane and you trace the wires, the wires from the system operation and the fan operation don't even interconnect. [00:26:21] Speaker 01: Just a quick note on damages. [00:26:26] Speaker 01: The only point I wanted to make here is it's uncontradicted on this record, given the evidence that our damages expert [00:26:33] Speaker 01: could not understand their January 2013 spreadsheet. [00:26:39] Speaker 01: And that's A338586 paragraph 3. [00:26:43] Speaker 01: When we told the court during the trial, it was, quote, we struggled with understanding the sales numbers. [00:26:50] Speaker 01: It was, quote, incredibly hard to understand them at A5630. [00:26:55] Speaker 01: And we suggested a reasonable solution. [00:26:58] Speaker 01: Your damages expert doesn't have these numbers in his report. [00:27:02] Speaker 01: Ours doesn't either. [00:27:03] Speaker 01: We can't understand them. [00:27:05] Speaker 01: We can't understand the stipulation you're giving the jury. [00:27:08] Speaker 01: Why don't we just give the jury a royalty rate, and then we can determine these numbers that we can't figure out later after the trial. [00:27:15] Speaker 01: We thought that was a reasonable solution, but it was rejected. [00:27:19] Speaker 01: One last thing. [00:27:20] Speaker 01: The district court enter her ruling that where she rejected our damages supposition. [00:27:26] Speaker 01: our Rule 60 motion, she said at 819, it's, I find that none of your cases, ABT, that none of your cases teach or hold awarding damages for infringing sales before the jury verdict. [00:27:41] Speaker 01: And in fact, there were two that we cited to her, Maxwell and Boston Scientific, and both of those cases, and in particular, Boston Scientific is this one, pre-trial infringing sales were [00:27:56] Speaker 01: After the verdict, under Rule 16, a motion amended to judgment was granted in those cases. [00:28:02] Speaker 01: Thank you very much. [00:28:02] Speaker 05: Thank you. [00:28:04] Speaker 05: Just as a cautionary note, typically the panel has allowed you a lot of leeway because with regard to your main appeal, we usually typically do not allow you to raise issues that hadn't been raised previously where the other side has not responded at all. [00:28:21] Speaker 05: We rely on the briefs to a great extent in any event. [00:28:26] Speaker 04: Just a couple of things that I want to clear up. [00:28:30] Speaker 04: First of all, there was talk about Dr. Siegel and what he had said. [00:28:35] Speaker 04: He also testified that generally, if the fan's been running, you assume some mixing, and so don't run the fan for a while because the air has just been mixed, which is exactly the combination that he had said earlier was taught away from. [00:28:53] Speaker 04: It's simply a combination of the prior art patent [00:28:57] Speaker 04: What about your friend's comment about your own expert's testimony? [00:29:08] Speaker 04: Yes, absolutely, because that question at that time was very specific as to what's the best time to run the fan. [00:29:14] Speaker 04: But the Rudd patent doesn't answer that either. [00:29:16] Speaker 04: The Rudd patent simply says there's a pause before it starts cycling, and you can set that to anything. [00:29:22] Speaker 04: It could be a one minute pause. [00:29:24] Speaker 04: It could be, like Emerson's, a one hour pause. [00:29:28] Speaker 04: So Dr. Sherman was correct. [00:29:30] Speaker 04: There's no way to know in any specific house what that pause should be. [00:29:35] Speaker 04: But the fact that there should be a pause was agreed by Dr. Siegel when he said, if the fan's been running, as it does during the call for heating or cooling, you assume some mixing. [00:29:47] Speaker 04: And so don't run the fan for a while because the air has just been missed. [00:29:51] Speaker 04: That's the combination. [00:29:52] Speaker 00: So what do we make of the [00:29:55] Speaker 00: reaffirming, if you will, the patent on reexamination in the face of at least some of this prior art. [00:30:01] Speaker 00: Hanson, I'm sorry, not Hanson Hitch. [00:30:04] Speaker 00: Vogelsang. [00:30:04] Speaker 00: Vogelsang and Nakatsuno. [00:30:06] Speaker 04: Yes. [00:30:09] Speaker 04: I think that the patent novice was confused looking at the record on that, over the word dependent and independent of. [00:30:19] Speaker 04: Vogelsang talked about how the fans cycled [00:30:22] Speaker 04: independent of the heating and cooling. [00:30:26] Speaker 04: So it's independent. [00:30:28] Speaker 04: The Rudd patent says that the cycling of the fan depends on a preselected pause. [00:30:34] Speaker 04: They're really saying the same thing, but they're using opposite words. [00:30:38] Speaker 04: And I think that the patent examiner got that confused. [00:30:41] Speaker 02: That was also before KSR, where there wasn't... Isn't your easy answer that the re-exam was before KSR? [00:30:47] Speaker 04: Well, that would be the easy answer. [00:30:50] Speaker 04: Yes. [00:30:50] Speaker 02: Well, I mean, they're using a different test for motivation to combine. [00:30:54] Speaker 04: That's right. [00:30:55] Speaker 04: That's right. [00:30:57] Speaker 04: There's one more point I want to make on damages. [00:30:59] Speaker 05: No, no, no. [00:31:00] Speaker 05: You're on your cross appeal. [00:31:02] Speaker 05: So we don't, even though I cautioned your friend. [00:31:05] Speaker 04: OK. [00:31:06] Speaker 04: I just wanted to respond to what he just said. [00:31:08] Speaker 05: No, I appreciate that. [00:31:09] Speaker 05: But I think we're out of time. [00:31:11] Speaker 04: All right. [00:31:12] Speaker 04: Thank you.