for the federal circuit2017-1698; 2017-1699; 2017-1701 the lex groupdc 1825 k street, n.w. suite 103...

2017-1698; 2017-1699; 2017-1701

THE LEX GROUPDC 1825 K Street, N.W. Suite 103 Washington, D.C. 20006 (202) 955-0001 (800) 856-4419 Fax: (202) 955-0022 www.thelexgroup.com

In The

United States Court of Appeals For The Federal Circuit

APPLICATIONS IN INTERNET TIME, LLC,

Appellant,

v.

RPX CORPORATION,

Appellee.

APPEALS FROM THE UNITED STATES PATENT AND TRADEMARK OFFICE, PATENT TRIAL AND APPEAL BOARD

IN NOS. IPR2015-01750, IPR2015-01751, AND IPR2015-01752.

NON-CONFIDENTIAL REPLY BRIEF OF APPELLANT

Steven C. Sereboff SOCAL IP LAW GROUP LLP 310 North Westlake Boulevard, Suite 120 Westlake Village, California 91362 (805) 230-1350 (Telephone) (805) 230-1355 (Facsimile) [email protected] Counsel for Appellant

Case: 17-1698 Document: 36 Page: 1 Filed: 08/02/2017

i

CERTIFICATE OF INTEREST Counsel for the appellant certifies the following:

1. Full Name of Party Represented by me: Applications in Internet Time, LLC.

2. Name of Real Party in interest represented by me: None.

3. Parent corporations and publicly held companies that own 10% or more of

stock in the party: None.

4. The names of all law firms and the partners or associates that appeared for

the party or amicus now represented by me in the trial court or agency or are

expected to appear in this court (and who have not or will not enter an

appearance in this case) are: SoCal IP Law Group LLP, Steven C. Sereboff,

Jonathan P. Pearce, M. Kala Sarvaiya.

August 2, 2017 /s/ Steven C. Sereboff Date Signature of Counsel

Steven C. Sereboff Printed Name of Counsel


ii

TABLE OF CONTENTS

Page CERTIFICATE OF INTEREST ................................................................................. i TABLE OF CONTENTS .......................................................................................... ii TABLE OF AUTHORITIES .................................................................................... iv INTRODUCTION ..................................................................................................... 1 I. Constitutional Standing ......................................................................... 2

II. What Congress Meant by “Real Party in Interest, or “Privy of the Petitioner” ........................................................................................ 4

III. “In Light of the Specification” in Light of Cuozzo ............................. 20

IV. The Role of “Plain and Ordinary Meaning” in an IPR ....................... 22

V. How to weigh the evidence ................................................................. 23 VI Under AIT’s Construction, the Claims are Valid ............................... 23 VII. RPX’s Failed Waiver Arguments ........................................................ 24

CONCLUSION ........................................................................................................ 25 CERTIFICATE OF FILING AND SERVICE CERTIFICATE OF COMPLIANCE


iii

CONFIDENTIAL MATERIAL The highlighted text in this brief refers to material that the parties designated as

confidential under the protective order in this case in accordance with Fed. R. Civ.

P. 26(c) (XXXX) and that Applications in Internet Time LLC has omitted from the

nonconfidential version of this brief under Fed. Cir. R. 28(d)(1)(A). The text

highlighted on pages 4, 19 and 20 relates to internal sales information of RPX.

August 2, 2017 /s/ Steven C. Sereboff Date Signature of Counsel

Steven C. Sereboff Printed Name of Counsel


iv

TABLE OF AUTHORITIES

Page(s)

CASES Achates Reference Publishing, Inc. v. Apple Inc.,

803 F.3d 652 (2015) .................................................................................... 5, 6 ASARCO Inc. v. Kadish,

490 U.S. 605 (1989)..................................................................................... 3, 4 Cuozzo Speed Techs., LLC v. Lee,

136 S. Ct. 2131 (2016) ................................................................... 1, 20, 21, 22 DaimlerChrysler Corp. v. Cuno,

547 U.S. 332 (2006)................................................................................. 2, 3, 4 Genzyme Therapeutic Prods. Ltd. P’ship v. Biomarin Pharm. Inc.,

825 F.3d 1360 (Fed. Cir. 2016) ..................................................................... 21 In re Crish,

393 F.3d 1253 (Fed. Cir. 2004) ..................................................................... 21 In re Nuvasive, Inc.,

842 F.3d 1376 (Fed. Cir. 2016) ..................................................................... 25 In re Yamamoto,

740 F.2d 1569 (Fed. Cir. 1984) ..................................................................... 21 Phigenix, Inc. v. ImmunoGen, Inc.,

845 F.3d 1168 (Fed. Cir. 2017) ....................................................................... 3 Phillips v AWH. Phillips v. AWH Corp.,

415 F.3d 1303 (Fed. Cir. 2005) ..................................................................... 22 Summit 6, LLC v. Samsung Elecs. Co.,

802 F.3d 1283 (2015) .................................................................................... 24


v

Trivascular, Inc. v. Samuels, 812 F.3d 1056 (Fed. Cir. 2016) ......................................................... 21, 22, 25

REGULATION 37 C.F.R. § 42.100(b) ........................................................................................ 21, 22 OTHER AUTHORITY Unified’s Real Party-in-Interest PTAB Panel Decisions” (July 5, 2016), at https://www.unifiedpatents.com/news/real-party-in-interest-panel-decisions .......... 4


1

INTRODUCTION

In its principal brief, AIT raised and argued only issues of law. RPX

distracts from the legal issues largely by arguing the facts. There is little dispute

about the facts. Explicit in AIT’s principal brief, and implicit in RPX’s response, is

that if this Court holds in favor of AIT on any of the legal issues, RPX loses. The

law squarely supports AIT. So do the facts. So does justice.

Many of the legal issues here present the Court an opportunity to end abuses

of the IPR system. These issues include:

• Ending the limitless IPRs by disinterested third parties through Article

III standing requirements;

• Ending the charade of IPRs filed by vigilantes who easily evade the

Congressional mandate against filings on behalf of a “real party in

interest, or privy of the petitioner;” and

• What the Supreme Court meant in Cuozzo by “in light of the

specification.”

For the reasons that follow, the Court should vacate the Board’s decisions

because RPX lacks Article III standing. If the Court elects to consider these

appeals on the merits, RPX should be excluded from participating because of its

lack of standing.


2

On the merits, RPX should be recognized as a proxy for Salesforce. To the

extent that the Board test for real party at interest excludes Salesforce, the test is

inadequate – an issue of law that should be corrected by this Court. Because

Salesforce was time-barred, the Court should hold RPX time-barred as well.

Further on the merits, the Board’s errors in claim construction should be

corrected. Based upon the proper claim construction and the clear weight of the

evidence, the claims are patentable over the asserted prior art.

I. Constitutional Standing

RPX lacks Constitutional standing. Though AIT initially argued that RPX

should be excluded from this appeal, under DaimlerChrysler, the law is quite clear

that vacature of the Board’s decisions is proper.

Because AIT disputes RPX’s standing, RPX bears the burden to show it has

standing. RPX argues that because AIT is the appellant, RPX need not show

standing. The Supreme Court’s decision in DaimlerChrylser resolves the issue in

favor of AIT: “Nonetheless, because we presume that federal courts lack

jurisdiction unless the contrary appears affirmatively from the record, the party

asserting federal jurisdiction when it is challenged has the burden of establishing

it.” DaimlerChrysler Corp. v. Cuno, 547 U.S. 332, 342 n. 3 (2006) (cites and

internal quotation marks omitted). Thus, under DaimlerChrylser, a lack of standing

is presumed.


3

RPX argues that because AIT is the appellant, RPX need not show standing.

Resp. 4. That argument is plainly wrong in light of cases such as DaimlerChrylser,

where the petitioner raised the standing issue.

RPX has not and cannot show standing. As in Phigenix, because RPX claims

to be a disinterested third party, it has no standing. RPX’s opposition did not even

try to demonstrate that it has any case or controversy with AIT. Rather, RPX left to

a footnote, Resp. 8, n. 6, a demurer that it could somehow satisfy Article III

standing. Yet, RPX utterly failed to assert any facts in support.

In light of DaimlerChrylser, vacature of the Board’s decisions is

appropriate. In Phigenix, the patent owner/appellee raised the issue and requested

dismissal of the appeal. Phigenix, Inc. v. ImmunoGen, Inc., 845 F.3d 1168 (Fed.

Cir. 2017). This Court’s dismissal of the appeal gave the patent owner justice,

because it left standing the Board’s decision confirming patentability. In

DaimlerChrysler, the Supreme Court did not even discuss dismissing the

proceeding because that would have been entirely unjust to the petitioner. The

same is true here. The proper course here, as in DaimlerChrylser, is dismissal of

RPX’s challenge to AIT’s patents through vacature of the Board’s decisions.

Both AIT and RPX cited ASARCO Inc. v. Kadish, 490 U.S. 605, 618 (1989),

though for different reasons. RPX cited ASARCO as analogous, but ASARCO was

not an appeal of an agency decision. Resp. 5 In ASARCO, the case originated in


4

state court, and the Supreme Court explained in detail why it needed to respect the

independent authority of state courts. The Supreme Court’s articulation of the issue

demonstrates this: “The question is whether, under federal standards, the case was

nonjusticiable at its outset because the original plaintiffs lacked standing to sue …”

ASARCO, Inc. v. Kadish, 490 U.S. 605, 612. Yet, unlike ASARCO, the issue here is

whether this case is justiciable now, and how to resolve the lack of standing.

If there was any doubt, the Supreme Court’s later decision in

DaimlerChrysler forecloses those doubts. The state court comity which the

Supreme Court needed to consider in cases like ASARCO and DaimlerChrysler

simply does not exist in this appeal from the Board.

II. What Congress Meant by “Real Party in Interest, or “Privy of the

Petitioner”

When a party touts its ability to flout the law, something is clearly wrong.

Unified Patents, Inc. does just this: “Through almost four years and nearly fifty

patentability challenges, Unified Patents (UPI) has never lost a real party-in-

interest (RPI) decision before the PTAB.” “Unified’s Real Party-in-Interest PTAB

Panel Decisions” (July 5, 2016), at https://www.unifiedpatents.com/news/real-

party-in-interest-panel-decisions (cited in AIT’s opening brief). a written

policy which reflects the same view. Appx080-081. UPI, like RPX, is a

membership organization whose members benefit from their IPR petitions. These

CONTAINS CONFIDENTIAL INFORMATION PURSUANT TO PROTECTIVE ORDERCase: 17-1698 Document: 36 Page: 10 Filed: 08/02/2017

5

“members” flout the one-year time limit on IPR petitions simply because their

proxy’s name is on the petition, not their own.

Salesforce, through its proxy RPX, got a second bite at the apple. This is not

what Congress intended. From the outset of the underlying IPR petitions, the

parties hotly contested whether RPX was a self-serving vigilante as RPX claimed,

or if RPX instead was the proxy of Salesforce. The facts are in the record, but the

important questions are legal here. The record is clear: the Board ignored the

“privy” element and applied “real party in interest” too narrowly.

Both parties cite Achates, which forecloses fact arguments regarding the

Board’s institution decisions, but it leaves open certain legal arguments. Achates

Reference Publishing, Inc. v. Apple Inc., 803 F.3d 652 (2015). This Court stated, in

relevant part in Achates:

We thus hold that 35 U.S.C. § 314(d) prohibits this court from

reviewing the Board’s determination to initiate IPR proceedings based

on its assessment of the timebar of § 315(b), even if such assessment

is reconsidered during the merits phase of proceedings and restated as

part of the Board’s final written decision. Still, even when the

statutory language bars judicial review, courts have recognized that an

implicit and narrow exception to the bar on judicial review exists for

claims that the agency exceeded the scope of its delegated authority or

violated a clear statutory mandate. However, statutory interpretation

disputes fall outside this exception for ultra vires agency action, and

only the egregious error melds the agency’s decision into

justiciability. Here, although Achates did not raise this argument, the

Board’s institution decision does not violate a clear statutory mandate.


6

Achates, 658-659 (internal cites and quotation marks removed for

readability).

In the IPRs at issue here, “the agency exceeded the scope of its delegated

authority or violated a clear statutory mandate.” Specifically, the Board

misinterpreted § 315(b) by construing “real party in interest” too narrowly, and

ignoring “privy.” This was an “egregious error” which “melds the agency’s

decision into justiciability.” Unless this Court corrects the Board, the injustice of

the Board’s errors inevitably will continue.

Overall, AIT’s research shows that the Board has instituted IPR over the

patent owner’s real party in interest or privity argument 178 times, and that does

not even account for patent owners that considered the argument to be futile and

did not even try:

1. Petition for Inter Partes Review by Blue Coat Systems, Inc.

IPR2016-01444 (PTAB July 18, 2017)

2. Petition for Inter Partes Review by VIZIO, Inc.

IPR2017-00558 (PTAB July 7, 2017)


IPR2017-00551 (PTAB July 7, 2017)


IPR2017-00552 (PTAB July 7, 2017)


IPR2017-00556 (PTAB July 6, 2017)

6. Petition for Inter Partes Review by The United States as represented by the

Department of Justice and the Department of Homeland Security

IPR2017-00186 (PTAB May 3, 2017)


7


Department of Justice and the Department of Homeland Security.

IPR2017-00160 (PTAB May 2, 2017)



IPR2017-00183 (PTAB May 1, 2017)



IPR2017-00180 (PTAB April 26, 2017)



IPR2017-00185 (PTAB)

11. Petition for Inter Partes Review by Panties Plus, Inc.

IPR2017-00044 (PTAB April 12, 2017)

12. Petition for Inter Partes Review by Weatherford International, LLC

IPR2016-01509 (PTAB February 23, 2017)





15. Petition for Inter Partes Review by Wockhardt Bio AG

IPR2016-01582 (PTAB January 19, 2017)

16. Petition for Inter Partes Review by D-Link Systems, Inc.

IPR2016-01425 (PTAB January 17, 2017)

17. Petition for Inter Partes Review by Merck Sharp & Dohmen Corp.

IPR2016-01186 (PTAB December 19, 2016)

18. Petition for Inter Partes Review by Teletrac, Inc.


19. Petition for Inter Partes Review by Apple Inc.


20. Petition for Inter Partes Review by Apple Inc.


21. Petition for Inter Partes Review by Acuity Brands Lighting, Inc.



8

22. Petition for Inter Partes Review by Acuity Brands Lighting, Inc.


23. Petition for Inter Partes Review by US Department of Justice

IPR2016-01035 (PTAB November 15, 2016)








IPR2016-01040 (PTA November 15, 2016B)



29. Petition for Inter Partes Review by Nanya Technology Corporation


30. Petition for Inter Partes Review by Merial, Inc.


31. Petition for Inter Partes Review by Mazda Motor of America, Inc.

IPR2016-00958 (PTAB October 26, 2016)

32. Petition for Inter Partes Review by Synaptics Incorporated

IPR2016-00863 (PTAB October 12, 2016)


IPR2016-00865 (PTAB October 12, 2016)


IPR2016-00866 (PTAB October 12, 2016)

35. Petition for Inter Partes Review by Commissariat a l’Energie Atomique et aux

Energies Alternatives

IPR2016-00831 (PTAB September 28, 2016)







9


38. Petition for Inter Partes Review by Semiconductor Components Industries, LLC

d/b/a ON Semiconductor


39. Petition for Inter Partes Review by Frontier Therapeutics, LLC


40. Petition for Inter Partes Review by The United States Department of Justice

IPR2016-00497 (PTAB July 25, 2016)

41. Petition for Inter Partes Review by 1964 Ears, LLC

IPR2016-00494 (PTAB July 20, 2016)

42. Petition for Inter Partes Review by Aerospace Communications Holdings Co.,

Ltd.

IPR2016-00441 (PTAB July 5, 2016)

43. Petition for Inter Partes Review by Aerospace Communications Holdings Co.,

Ltd.

IPR2016-00442 (PTAB July 5, 2016)

44. Petition for Inter Partes Review by Unified Patents Inc.

IPR2016-00364 (PTAB June 27, 2016)

45. Petition for Inter Partes Review by ARRIS Group, Inc.

IPR2016-00428 (PTAB June 22, 2016)

46. Petition for Inter Partes Review by RPX Corporation

IPR2015-01750 (PTAB May 12, 2016)


IPR2015-01751 (PTAB May 12, 2016)


IPR2015-01752 (PTAB May 12, 2016)

49. Petition for Inter Partes Review by Unified Patents, Inc.

IPR2016-00174 (PTAB May 12, 2016)

50. Petition for Inter Partes Review by Google Inc.

IPR2016-00022 (PTAB April 25, 2016)

51. Petition for Inter Partes Review by Google Inc.

IPR2016-00045 (PTAB April 25, 2016)


IPR2015-01940 (PTAB April 13, 2016)


10

53. Petition for Inter Partes Review by KJ Pretech Co., Ltd.

IPR2015-01866 (PTAB March 17, 2016)


IPR2015-01867 (PTA March 17, 201B)


IPR2015-01868 (PTAB March 17, 2016)

56. Petition for Inter Partes Review by Ericsson, Inc.

IPR2015-01872 (PTAB March 14, 2016)

57. Petition for Inter Partes Review by Coalition for Affordable Drugs VIII, LLC

IPR2015-01835 (PTAB March 7, 2016)

58. Petition for Inter Partes Review by Coalition for Affordable Drugs VIII LLC

IPR2015-01836 (PTAB March 7, 2016)

59. Petition for Inter Partes Review by Zero Gravity Inside, Inc.

IPR2015-01769 (PTA February 12, 2016B)

60. Petition for Inter Partes Review by TRW Automotive US LLC


61. Petition for Inter Partes Review by Daifuku Co., Ltd

IPR2015-01541 (PTAB January 20, 2016)

62. Petition for Inter Partes Review by Daifuku Co., Ltd.

IPR2015-01538 (PTAB January 19, 2016)

63. Petition for Inter Partes Review by Daifuku Co., Ltd.

IPR2015-01539 (PTAB January 19, 2016)

64. Petition for Inter Partes Review by Funai Electric Co., Ltd.

IPR2015-01468 (PTAB January 6, 2016)

65. Petition for Inter Partes Review by Samsung Display Co., Ltd.

IPR2015-01469 (PTAB January 4, 2016)

66. Petition for Inter Partes Review by Elekta Inc.


67. Petition for Inter Partes Review by Global Tel*Link Corporation

IPR2015-01226 (PTAB)





11


70. Petition for Inter Partes Review by Funai Electric Co., Ltd.


71. Petition for Inter Partes Review by Toshiba Corporation


72. Petition for Inter Partes Review by Toshiba Corporation


73. Petition for Inter Partes Review by Legend3D, Inc.




75. Petition for Inter Partes Review by Cox Communications, Inc.






78. Petition for Inter Partes Review by CeramTec GmbH


79. Petition for Inter Partes Review by PixArt Imaging Inc.


80. Petition for Inter Partes Review by Sensus USA, Inc.













12



87. Petition for Inter Partes Review by Bungie, Inc.




89. Petition for Inter Partes Review by Kofax, Inc.












95. Petition for Inter Partes Review by Par Pharmaceutical, Inc.




97. Petition for Inter Partes Review by Coalition for Affordable Drugs VI LLC

IPR2015-01096 (PTAB October 27, 2015)


IPR2015-01102 (PTAB October 27, 2015)


IPR2015-01103 (PTAB October 27, 2015)

100. Petition for Inter Partes Review by Coalition for Affordable Drugs II LLC

IPR2015-00990 (PTAB October 23, 2015)

101. Petition for Inter Partes Review by Coalition for Affordable Drugs II, LLC

IPR2015-01093 (PTAB October 23, 2015)

102. Petition for Inter Partes Review by Coalition for Affordable Drugs III LLC


13

IPR2015-01018 (PTAB October 15, 2015)

103. Petition for Inter Partes Review by Caterpillar Inc.

IPR2015-01032 (PTAB October 15, 2015)


IPR2015-01061 (PTAB October 15, 2015)


IPR2015-01012 (PTAB October 13, 2015)


IPR2015-01013 (PTAB October 13, 2015)

107. Petition for Inter Partes Review by Coalition For Affordable Drugs II LLC

IPR2015-00988 (PTAB October 7, 2015)

108. Petition for Inter Partes Review by The Mangrove Partners Master Fund, Ltd.

IPR2015-01046 (PTAB October 7, 2015)

109. Petition for Inter Partes Review by The Mangrove Partners Master Fund, Ltd.

IPR2015-01047 (PTAB October 7, 2015)


IPR2015-00960 (PTAB October 5, 2015)


IPR2015-00961 (PTAB October 5, 2015)


IPR2015-00923 (PTAB October 1, 2015)

113. Petition for Inter Partes Review by First Quality Baby Products, LLC







IPR2015-00950 (PTAB)

117. Petition for Inter Partes Review by Accord Healthcare Inc. USA


118. Petition for Inter Partes Review by Accord Healthcare Inc., USA



14

119. Petition for Inter Partes Review by Amneal Pharmaceuticals LLC

IPR2015-00545 (PTAB July 29, 2015)


IPR2015-00548 (PTAB July 28, 2015)


IPR2015-00546 (PTAB July 28, 2015)


IPR2015-00547 (PTAB July 28, 2015)


IPR2015-00551 (PTAB July 28, 2015)


IPR2015-00554 (PTAB July 28, 2015)

125. Petition for Inter Partes Review by Nanoco Technologies, Ltd.

IPR2015-00528 (PTAB July 27, 2015)

126. Petition for Inter Partes Review by Nanoco Technologies Ltd.

IPR2015-00532 (PTAB July 27, 2015)

127. Petition for Inter Partes Review by Mercedes-Benz USA, LLC

IPR2015-00397 (PTAB July 17, 2015)

128. Petition for Inter Partes Review by LG Display Co., Ltd.

IPR2015-00487 (PTAB July 16, 2015)

129. Petition for Inter Partes Review by LG Electronics, Inc.

IPR2015-00493 (PTAB July 15, 2015)

130. Petition for Inter Partes Review by Amazon.com, Inc.

IPR2015-00480 (PTAB July 13, 2015)


IPR2015-00489 (PTAB July 13, 2015)


IPR2015-00490 (PTAB July 10, 2015)


IPR2015-00506 (PTAB July 6, 2015)

134. Petition for Inter Partes Review by Nestle USA, Inc.

IPR2015-00195 (PTAB June 29, 2015)

135. Petition for Inter Partes Review by Caterpillar Inc.


15

IPR2015-00409 (PTAB June 18, 2015)

136. Petition for Inter Partes Review by Shopkick, Inc.

IPR2015-00277 (PTAB May 29, 2015)


IPR2015-00278 (PTAB May 29, 2015)


IPR2015-00279 (PTAB May 29, 2015)

139. Petition for Inter Partes Review by Huawei Device USA, Inc.

IPR2015-00203 (PTAB May 28, 2015)

140. Petition for Inter Partes Review by The Brinkmann Corporation

IPR2015-00056 (PTAB March 23, 2015)

141. Petition for Inter Partes Review by Paramount Home Entertainment Inc.

IPR2014-00961 (PTAB March 19, 2015)

142. Petition for Inter Partes Review by Paramount Home Entertainment Inc.

IPR2014-00962 (PTAB March 19, 2015)


IPR2014-01497 (PTAB March 19, 2015)


IPR2014-01499 (PTAB March 19, 2015)

145. Petition for Inter Partes Review by Petroleum Geo-Services, Inc.

IPR2014-01475 (PTAB March 17, 2015)

146. Petition for Inter Partes Review by Petroleum Geo-Services, Inc.

IPR2014-01477 (PTAB March 17, 2015)


IPR2014-01362 (PTAB March 2, 2015)



149. Petition for Inter Partes Review by TRW Automotive U.S. LLC




151. Petition for Inter Partes Review by Aruze Gaming Macau, Ltd.



16



153. Petition for Inter Partes Review by Valeo Inc.

IPR2014-01203 (PTAB January 28, 2015)

154. Petition for Inter Partes Review by Valeo North America, Inc. f/k/a Valeo, Inc.

IPR2014-01204 (PTAB January 28, 2015)


IPR2014-01096 (PTAB January 13, 2015)


IPR2014-01097 (PTAB January 13, 2015)

157. Petition for Inter Partes Review by Valeo, Inc.


158. Petition for Inter Partes Review by Valeo, Inc.


159. Petition for Inter Partes Review by Wavemarket, Inc. d/b/a Location Labs


160. Petition for Inter Partes Review by Petroleum Geo-Services Inc.






163. Petition for Inter Partes Review by Commerce Bancshares, Inc.

IPR2014-00801 (PTA December 1, 2014B)

164. Petition for Inter Partes Review by Samsung Electronics Co., Ltd.








168. Petition for Inter Partes Review by Samsung Electronics Co. Ltd.


17


169. Petition for Inter Partes Review by First Data Corporation

IPR2014-00715 (PTAB October 17, 2014)

170. Petition for Inter Partes Review by First Data Corporation

IPR2014-00720 (PTAB October 17, 2014)

171. Petition for Inter Partes Review by ABB Technology Ltd.

IPR2014-00147 (PTAB May 23, 2014)

172. Petition for Inter Partes Review by Hewlett-Packard Company


173. Petition for Inter Partes Review by BAE Systems Information and Electronic

Systems Integration, Inc.

IPR2013-00175 (PTA July 3, 2013B)

174. Petition for Inter Partes Review by Innolux Corporation

IPR2013-00060 (PTAB May 3, 2013)


IPR2013-00065 (PTAB April 30, 2013)


IPR2013-00064 (PTAB)


IPR2013-00066 (PTAB April 24, 2013)

178. Petition for Inter Partes Review by Synopsys, Inc.


This contrasts dramatically with the instances in which the Board denied

institution on the basis of real party in interest. In the last two years, the Board

denied institution of an IPR just two times on real party in interest or privity, and

both times because of blurred lines of corporate separation between the companies.

Petition for Inter Partes Review by Zhejiang Yankon Group, Ltd; Case no.

IPR2015-01420 (PTAB November 25, 2015); Petition for Inter Partes Review by


18

Aceto Agricultural Chemicals Corp., Case No. IPR2015-01016 (PTAB October 2,

2015).

In fact, almost all petition denials on the basis of real party in interest or

privy came in a flurry of related decisions in February, March and April 2015

(shading added to show related cases):

Petition for Inter Partes Review by Reflectix, Inc.

IPR2015-00039, IPR2015-00042, IPR2015-00044, IPR2015-00045,

IPR2015-00047 (PTAB April 24, 2015) (blurred lines of corporate

separation between the companies)

Petition for Inter Partes Review by General Electric Company

IPR2014-01380, IPR2014-01505, IPR2014-01559 (PTAB April 15, 2015)

(privity found because petitioner had control of un-named party’s defense in

related lawsuit)

Petition for Inter Partes Review by VMware, Inc.

IPR2015-00027, IPR2015-00030, IPR2015-00031 (PTAB March 6, 2015)

(corporate parent was in privity with subsidiary)

Petition for Inter Partes Review by VMware, Inc.

IPR2014-01324 (PTAB February 20, 2015) (corporate parent was in privity

with subsidiary)

Petition for Inter Partes Review by Galderma SA

IPR2014-01422, IPR2014-01417 (PTAB March 5, 2015) (substantial

overlap in the boards of directors of related companies)

Petition for Inter Partes Review by Zerto, Inc.

IPR2014-01254, IPR2014-01295, IPR2014-01329, IPR2014-01332 (PTAB

March 3, 2015) (blurred lines of corporate separation between the

companies)

Petition for Inter Partes Review by Paramount Home Entertainment Inc.

IPR2014-00961, IPR2014-00962 (PTAB December 29, 2014) (unnamed

parent exercised control over the petition)

Petition for Inter Partes Review by RPX Corporation

IPR2014-00171, IPR2014-00172, IPR2014-00173, IPR2014-00174,

IPR2014-00175, IPR2014-00176, IPR2014-00177 (PTAB July 14, 2014)


19

(unnamed party directly funded the petitions)

Petition for Inter Partes Review by ZOLL Lifecor Corporation

IPR2013-00606, IPR2013-00607, IPR2013-00609, IPR2013-00612,

IPR2013-00613, IPR2013-00615, IPR2013-00616, IPR2013-00618 (PTAB

March 20, 2014) (unnamed parent exercised control over the petition)

Though in its institution decisions here the Board correctly explained that

the question of real party in interest is heavily fact based and recited many factors

to consider, the outcomes in real cases reflect something different. The Board’s

narrow view including the record here, is not what Congress intended. And, as

demonstrated by Appx080-081, potential proxies

quickly developed procedures specifically designed to avoid becoming a real party

at interest for their clients.

Even under the Board’s factors, the evidence of record should be enough to

show that RPX is a time-barred proxy of Salesforce. Even if all of RPX’s self-

serving facts1 are true, the question is not regarding the facts, it is whether

Salesforce is a real party in interest or privy under the totality of the circumstances.

The legal standard used by the Board is wrong, and too narrow. Even under the

totality of the evidence standard, Salesforce is both a real party in interest and a

1 RPX protests that its “fulsome production including a 21 page declaration from []

Chuang” set the issue to rest. However, AIT was not entitled to depose this

declarant or to even enter contradictory declaration evidence to refute the Chuang

declaration prior to the Board’s institution decision. Thus, the RPX freight train,

fueled by self-serving evidence ideally suited to the Board’s erroneously narrow

view of real party in interest, rolled right over AIT.


20

privy, but also believes that the Court needs to instruct the Board to correctly apply

the law corrsctly to end the harassment that AIT and other patent owners are

suffering.

It is undisputed that Salesforce is a privy of RPX.

and has Appx084. Salesforce was sued for

infringing the AIT patents. Resp. 19. The Board did not even address the privy

issue.

Despite RPX’s protestations about its independent interest, the strong

interest of Salesforce and the close relationship between RPX and Salesforce

demonstrate that RPX was acting for Salesforce, even if RPX was also acting on

behalf of its membership in general. That alone makes Salesforce a real party in

interest.

III. “In Light of the Specification” in Light of Cuozzo

AIT showed that Salesforce sought a narrow claim construction in litigation

and RPX sought a broad claim construction in the IPRs. RPX does not dispute this.

The Salesforce-RPX team treated the claims like “a nose of wax.” Claims are not a

nose of wax to be twisted one way to avoid infringement or another to invalidate.

Central to RPX’s ploy to twist the nose of wax overbroad was the testimony

of its expert, Dr. Crovella. AIT’s principal brief showed that Dr. Crovella used the

wrong legal standard, in which he swapped the required “in light of the


21

specification” standard of 37 C.F.R. § 42.100(b) with a looser “consistent with the

specification” standard. Opening Brief of Appellant 32. RPX says they are

interchangeable, Resp. 35 but its authority is out of date.

In Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct. 2131 (2016), the Supreme

Court, citing 37 C.F.R. § 42.100(b), said the standard is “in light of the

specification.” Lest there be doubt about their interchangeability, the Supreme

Court’s own usages of the phrases through that decision demonstrates that they are

not interchangeable. Compare Cuozzo at 2135, 2138, 2139, 2141, 2142, 2143,

2146 (“in light of”) with 2140, 2141 (“consistent with”).

The Supreme Court’s articulation in Cuozzo is controlling, and there is

nothing in the case law that states that these phrases are equivalent. RPX argues

that use of “consistent with” was common, yet cited only two IPR references.

Genzyme Therapeutic Prods. Ltd. P’ship v. Biomarin Pharm. Inc., 825 F.3d 1360

(Fed. Cir. 2016); Trivascular, Inc. v. Samuels, 812 F.3d 1056 (Fed. Cir. 2016).

These two cases, and the two others cited by RPX, came before Cuozzo. In re

Yamamoto, 740 F.2d 1569 (Fed. Cir. 1984); In re Crish, 393 F.3d 1253 (Fed. Cir.

2004). In none of these cases was the issue addressed, and one cannot even tell

whether the Court’s use of “consistent with” was material.


22

Because RPX did not and cannot show that “consistent with” is

interchangeable with “in light of,” the testimony of Dr. Crovella must be excluded.

The Board’s reliance upon that testimony was clear error.

IV. The Role of “Plain and Ordinary Meaning” in an IPR

RPX argues construction of select individual words in the claims, and then

further argues construction of these words according to their “plain and ordinary

meaning.” This approach takes construction out of the context of the claims, out of

the context of the specification, and out of reason.

Construing words of a claim out of context makes no sense. That was the

point of Phillips v AWH. Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005).

Thus, even under Cuozzo and 37 C.F.R. 42.100(b), words in a claim cannot be read

apart from the claim as a whole or the specification. Furthermore, as highlighted

above, both Cuozzo and 37 C.F.R. 42.100(b) require construction “in light of the

specification.”

To arrive at a reasonable meaning, construction is from the perspective of

one of ordinary skill in the art. As the Court recognized in Trivascular, Inc. v.

Samuels, 812 F.3d 1056 (Fed. Cir. 2016) (cited by RPX, Resp. 32), a “reasonable”

reading is one which is “in light of the specification as they would be interpreted

by one of ordinary skill in the art.” Id at 1061.


23

RPX artfully dodges the need for the perspective of one of ordinary skill in

the art. In RPX’s approach here, both the specification and the perspective of one

or ordinary skill in the art are ignored, and the Board was free to use any broad

meaning that it desired. Clearly RPX’s approach is wrong.

Even the Board’s opinions implicitly recognized that construction is from

the perspective of one of ordinary skill in the art. Appx404, Appx442. Under

RPX’s wildly broad approach to claim construction, there would be no basis to

even consider expert testimony on claim construction.

V. How to weigh the evidence

The Board weighed the extrinsic evidence on claim construction and sided

with AIT. Because the Board improperly relied upon Dr. Crovella’s testimony, the

Board erred. Without the Crovella testimony, the only evidence of record on claim

construction is the intrinsic evidence and the testimony of Dr. Jagadish and Mr.

Flynn. The only evidence supporting a “reasonable” interpretation, however, is the

expert testimony. This necessarily leads to the conclusion that the claim should be

interpreted as explained by Dr. Jagadish and Mr. Flynn. This is the same

construction urged by AIT. Appx1614, Appx1636.

VI. Under AIT’s Construction, the Claims are Valid

RPX argued that the claims are invalid even under AIT’s proposed

construction. Resp. 46. Not so. First, Mr. Flynn was not deposed. His testimony is


24

unrebutted.2 Second, Dr. Jagadish made clear the differences between the prior art

and the claimed invention. Appx1604-Appx1614

VII. RPX’s Failed Waiver Arguments

RPX argued that AIT waived its right to make an argument on the proxy

issue. Resp. 49-51. RPX cites as authority the Board’s Scheduling Order. Yet,

RPX’s own quotation of the Scheduling Order makes clear that the Board limited

waiver to “arguments for patentability.” Proxy is not a patentability issue. It is an

issue of standing to make a petition. And, the issue being argued is one of an

incorrect application of the law, an issue clearly raised by AIT at every phase of

the underlying IPRs.

RPX argued that AIT waived its argument that Dr. Crovella’s testimony

should not be considered. Resp. 36. Here again, admissibility of Dr. Crovella’s

testimony goes first to claim construction, not to patentability. This Court holds

that, “To avoid waiver, a party’s argument at trial and the appellate level should be

consistent.” Summit 6, LLC v. Samsung Elecs. Co., 802 F.3d 1283, 1290 (2015).

AIT challenged Crovella’s testimony in its Patent Owner Response, Appx1563 and

presented extensive argument on Dr. Crovella’s erroneous claim construction

standard at the oral hearing to which RPX did not object. Appx2029-2037 The

2 Apparently, RPX believes that unrebutted witness testimony carries great weight.

Resp. 32 (“Indeed, presented with the opportunity to depose Mr. Chuang, AIT

declined, leaving his testimony, and all of the other evidence produced by RPX,

unrebutted.”).


25

issue was preserved. Indeed, even RPX’s case law authority demonstrates that the

Court has discretion to consider the issue. In re Nuvasive, Inc., 842 F.3d 1376,

1380 (Fed. Cir. 2016) (the court “retains case-by-case discretion over whether to

apply waiver …”).

RPX also argued that AIT is arguing a new claim construction, which AIT

rejects. RPX argued, “If AIT deviates from that confirmation now, and attempts to

advance a narrower construction on appeal, this Court should find the argument

waived.” Resp. 29. This argument is made without citation of authority. Even if

AIT has advanced new claim construction arguments, which is it has not, they are

not “arguments for patentability.” Furthermore, AIT has been steadfast in arguing

that the prior art fails to show the relevant limitations. There is no requirement to

present arguments on appeal in ipsis verbisin. Regardless, the legal standard allows

the Court to interpret the claims de novo, Trivascular, 812. F.3d 1056 (Fed. Cir.

2016), so the view of the Board or the parties is not controlling.

CONCLUSION

Article III standing is an ever-present issue which must be carried by the

party asserting it has standing. RPX concedes that it has no case or controversy

with AIT. Thus, RPX has no right to participate in this appeal, and the Board’s

underlying decisions should be vacated.


26

RPX offers no justification for giving Salesforce a second bite at the

administrative challenge apple against AIT. Instead, it argues that the Board’s

decision to institute IPR, irrespective of its errors in law, should stand. It is time to

end the shenanigans promulgated by RPX and others, where they act as veiled

proxies for time-barred defendants.

Claims should be interpreted “in light of the specification,” not merely

“consistent with the specification.” RPX’s expert used an incorrect and overbroad

claim construction standard. His incorrect claim constructions, and incorrect

patentability analysis, provided the Board with the only evidence contrary to the

testimony of Dr. Jagadish and Mr. Flynn. The weight of the evidence, which

should not include Dr. Crovella’s testimony, supports AIT’s proposed claim

construction and a holding that the claims are not unpatentable.

AIT therefore respectfully requests that the Court (a) vacate the Board

decisions, (b) find that RPX was a time-barred proxy of Salesforce, and (c) reverse

the Board’s holding that the claims are unpatentable.

Respectfully submitted,

/s/ Steven C. Sereboff

Steven C. Sereboff

SoCal IP Law Group LLP

310 North Westlake Boulevard, Suite 120

Westlake Village, California 91362

(805) 230-1350 (Telephone)

(805) 230-1355 (Facsimile)

[email protected]


CERTIFICATE OF FILING AND SERVICE

I hereby certify that on this 2nd day of August, 2017, I caused this Non-

Confidential Reply Brief of Appellant to be filed electronically with the Clerk of

the Court using the CM/ECF System, which will send notice of such filing to the

following registered CM/ECF users:

Michael N. Rader

Richard Giunta

Elisabeth Hunt

WOLF, GREENFIELD & SACKS, PC

600 Atlantic Avenue

Boston, Massachusetts 02210

(617) 646-8000 (Telephone)

(617) 646-8646(Facsimile)

[email protected]

[email protected]

[email protected]

Counsel for Appellee

/s/ Steven C. Sereboff

Counsel for Appellant


CERTIFICATE OF COMPLIANCE

1. This brief complies with type-volume limits because, excluding the parts of

the document exempted by Fed. R. App. R. 32(f) (cover page, disclosure

statement, table of contents, table of citations, statement regarding oral

argument, signature block, certificates of counsel, addendum, attachments):

[ X ] this brief contains [6,187] words.

[ ] this brief uses a monospaced type and contains [state the number of]

lines of text.

2. This brief document complies with the typeface and type style requirements

because:

[ X ] this brief has been prepared in a proportionally spaced typeface using

[Microsoft Word 2007] in [14pt Times New Roman]; or

[ ] this brief has been prepared in a monospaced typeface using [state

name and version of word processing program] with [state number of

characters per inch and name of type style].

Dated: August 2, 2017 /s/ Steven C. Sereboff

Counsel for Appellant


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