Case 1:19-cv-00859-RTH Document 44-3 Filed 03/11/21 Page 1 of 7
`Case 1:19-cv-00859—RTH Document 44-3 Filed 03/11/21 Page 1 of 7
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`EXHIBIT C
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`EXHIBIT C
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`

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`Case 1:19-cv-00859-RTH Document 44-3 Filed 03/11/21 Page 2 of 7
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`O'Rourke Law Office, LLC
`
`1201 N. Orange Street, Suite 7260
`Wilmington, DE 19801-1186
`Telephone: (484)770-8046
`
`January 5, 2021
`VIA ELECTRONIC MAIL
`
`
`Re: e-Numerate Solutions, Inc. et al. v United States, Case No. 19-859-RTH
`
`Shahar Harel, Esq.
`Commercial Litigation Branch
`Civil Division
`Department of Justice
`Washington, DC 20530
`
`
`
`Dear Shahar:
`
`
`We write to follow up on our discussions about the United States Government’s (“the
`Government”) infringement of patents asserted by Plaintiffs e-Numerate Solutions, Inc., and e-
`Numerate, LLC, (collectively “e-Numerate”) in the above-referenced litigation.
`
`
`I.
`
` Procedural Background
`
`e-Numerate served its preliminary infringement contentions on December 15, 2020,
`pursuant to Court of Federal Claims Patent Rules (“CFCPR”) 4 and 5 and D.I. 36 and 38. The
`Government’s invalidity contentions are due on February 17, 2021 and the accompanying
`document production is due on February 19, 2021. See D.I. 36 and 38. With regard to that
`document production, CFCPR 7(a) requires the Government to produce:
`
`
`e-Numerate accused the Government of infringing at least United States Patent 9,600,842
`(“the ‘842 patent”) in its preliminary infringement contentions. Specifically, e-Numerate has
`accused the Securities and Exchange Commission (“SEC”), the Federal Deposit Insurance
`
`(a) documents that evidence the operation of any aspects or elements of the
`accused product, process, or method identified by the plaintiff as allegedly
`infringing.
`
`
`Id. The scope of the documents that e-Numerate believes should be produced by the
`Government is addressed below
`
`II.
`
`Identification of Accused Products
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`
`
`

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`Case 1:19-cv-00859-RTH Document 44-3 Filed 03/11/21 Page 3 of 7
`Shahar Harel, Esq.
`January 5, 2021
`Page 2
`Corporation ("FDIC") and the Federal Financial Institutions Examination Council ("FFIEC") of
`infringing at least the ‘842 patent.1
`
`
`With regard to the SEC, e-Numerate has accused of infringement certain publicly known
`systems run by the SEC. In addition, e-Numerate has alleged that the SEC has internal programs
`that validate SEC filings, review SEC filings for compliance, and/or review filings for possible
`fraud (“anti-fraud detector”).
`
`With regard to the FDIC and the FFIEC, e-Numerate has accused these entities of
`infringing the ‘842 patent by internal activities/systems/software that validate call reports and
`summary of deposits and, potentially, other filings made in XBRL format. See Preliminary
`Infringement Contentions at page 4.
`
`
`It is e-Numerate’s position that all systems and/or software used by the Government to
`validate XBRL filings likely infringe the ‘842 patent. Pursuant to CFCPR 7(a), the Government
`should produce documents relating to all such systems and/or software regardless of whether
`said systems and/or software are known to the general public.
`
`
`III.
`
`Additional Infringing Government Systems
`
`
`In addition to the SEC and the FDIC, e-Numerate believes that there are additional systems
`either in use or in development at multiple agencies of the Government that may infringe at least
`the ‘842 patent. e-Numerate believes that the US Federal Register and the Digital Accountability
`And Transparency Act of 2014 demonstrate the existence of additional infringement by the
`Government. We address each in turn.
`
`
`A. The US Federal Register
`
`Agencies proposing that outside entities file reports in XBRL format generally announce
`their intentions in the Federal Register, and solicit comments from industry. These
`announcements are evidence that the relevant agency may have developed software for
`collecting, aggregating, analyzing, and reporting data. A search of the term “XBRL” on the
`Federal Register obtains 215 results. Summarized by agency, they involve the following:
`
`
`Agency
`
`Securities Exchange
`Commission (SEC)
`Department of Energy
`(DOE)
`
`#
`
`Subject Matter
`
`FR
`Entries
`193 Presently accused of infringement.
`
`14 Requesting public comment on use of
`XBRL for FERC Forms. Mention is made
`of migrating internal software to XBRL.
`
`
`1 e-Numerate reserves the right to assert that the Government infringes the other patents-in-suit
`of infringement as discovery proceeds in this matter.
`
`

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`Case 1:19-cv-00859-RTH Document 44-3 Filed 03/11/21 Page 4 of 7
`Shahar Harel, Esq.
`January 5, 2021
`Page 3
`
`Federal Energy
`Regulatory Commission
`(FERC)
`Department of the
`Treasury (“Treasury”)
`
`Commodity Futures
`Trading Commission
`(CFTC)
`Office of the Comptroller
`of the Currency (OCC)
`
`Federal Deposit
`Insurance Corporation
`(FDIC)
`Federal Reserve System
`(FRS)
`
`Federal Financial
`Institutions Examining
`Council (FFIEC)
`Office of Thrift
`Supervision (OTS)
`
`14
`
`7
`
`4
`
`3
`
`3
`
`3
`
`1
`
`1
`
`Same subject matter as Department of
`Energy.
`
`Discusses moving data reports by financial
`institutions to structured format, such as
`XBRL. Mention is made of processing
`and analyzing FDIC Call Report XBRL in
`supervision. Other actions include
`requesting public comment on use of
`structured data for other industries.
`Requesting public comment on potential
`processing and analysis of structured data
`for Swap Reporting.
`Participated with other bank regulators in
`processing and analysis of FDIC Call
`Report XBRL.
`Already accused of infringement.
`
`Participated with other bank regulators in
`processing and analysis of FDIC Call
`Report XBRL.
`Already accused of infringement.
`
`Participated with other bank regulators in
`processing and analysis of FDIC Call
`Report XBRL.
`
`
`
`The activities of these Government agencies regarding validating XBRL filings are not
`public. Nevertheless, they may still constitute infringement under the controlling law as set forth
`below.
`
`B. Digital Accountability And Transparency Act Of 2014 (“Data Act”)
`
`While the Federal Register deals with the use of XBRL by the private sector, there are other
`initiatives aimed at XBRL use by US federal agencies themselves. The Data Act requires
`federal agencies to submit data on their spending to a central point, where it may be converted
`into structured form, analyzed, and reported to the public. There appear to be software
`applications at the United States Treasury and possibly other agencies that aggregate raw data
`from the originating agencies, format that data into a structured form, and analyze it. There
`appear to be two significant efforts at requiring agencies to submit data for use in structured form
`which potentially includes XBRL.
`
`One source of information on these efforts is found on the US Treasury’s website for a Data
`Act Information Model Schema (“DAIMS”) Initiative:
`
`

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`Case 1:19-cv-00859-RTH Document 44-3 Filed 03/11/21 Page 5 of 7
`Shahar Harel, Esq.
`January 5, 2021
`Page 4
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`https://fiscal.treasury.gov/data-transparency/DAIMS-current.html
`
` A
`
` second source of information is the “DATA Act Broker” software application:
`
`
`https://broker.usaspending.gov/#/login?redirect=/&_k=1uawus
`
`Again, all activities of Government agencies validating XBRL documents potentially
`infringe the ‘842 patent whether these activities are publicly disclosed or not.
`
`
`IV.
`
` Relevant Legal Principles
`
`During our call on this issue, you requested that we send you authority for your
`consideration. We address the following: (1) 28 U.S.C. § 2501; (2) the Government’s additional
`infringement constituting an additional taking; and (3) the Government’s testing constituting
`infringement.
`
`First, e-Numerate’s claims under at least the ‘842 patent cannot be time barred as a matter
`of law pursuant to 28 U.S.C. § 2501. The ‘842 patent issued on March 21, 2017. The current
`action against the Government was filed on June 11, 2019. All claims made against all infringing
`Government activities accrued for the ‘842 patent only as of the date the ‘842 patent issued (at the
`latest). See, e.g., Ross-Himes Designs, Inc. v. United States, 139 Fed. Cl. 444, 459 (C.F.C. 2018);
`Starobin v. United States, 662 F.2d 747, 750 (Ct. Cl. 1981) (per curiam) (“Thus, it is only when
`procurement of an item precedes the issuance of the patent rights, that the first use of the item
`subsequent to the issuance of the patent becomes the time of the taking for the purpose of 28 U.S.C.
`§ 2501.”).
`
`Second, each additional infringement by the Government constitutes an additional taking
`of e-Numerate’s patent rights. In Decca Ltd v. United States, 640 F.2d 1156 (Ct. Cl. 1980), the
`Court of Claims described the nature of the Government’s takings vis-a-vis new infringements as
`follows:
`
`
`The Government takes a license to use or to manufacture a patented
`invention as of the instant the invention is first used or manufactured by the
`Government. The license taken at that instant covers only what the Government is
`using or has manufactured as of that instant. If, after this first taking, the
`Government expands the scope of its use of the invention or manufactures
`additional units of the invention, the Government engages thereby in incremental
`takings. Each incremental taking vests the patentee with a new cause of action.
`
`Id. at 1166. Thus each new system/software introduced at each Government agency that is used,
`for example, to validate XBRL documents constitutes a new act of infringement.
`
`Third, the Government’s testing of XBRL validation software/systems can infringe the
`
`‘842 patent. In Unitrac, LLC v. United Sates, 113 Fed. Cl. 156 (Ct. Cl. 2013), the Court of
`Claims noted that:
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`

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`Case 1:19-cv-00859-RTH Document 44-3 Filed 03/11/21 Page 6 of 7
`Shahar Harel, Esq.
`January 5, 2021
`Page 5
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`
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`…testing, in and of itself, can constitute infringement. See Paper Converting
`Machine Co. v. Magna–Graphics Corp., 745 F.2d 11, 19–20 (Fed. Cir. 1984)
`(“testing the assemblies can be held to be in essence testing the patent
`combination and, hence infringement. That the machine was not operated in its
`optimum mode is inconsequential: imperfect practice of an invention does not
`avoid infringement.”); see also Bissell v. United States, No. 00–344C, 2001 WL
`36400606, at *3–4 (Fed. Cl. Sept. 28, 2001) (the Government’s unauthorized
`testing constitutes “use” under § 1498); Hughes Aircraft Co. v. United States, 29
`Fed. Cl. 197, 218 (1993) (characterizing Paper Converting as concluding that
`“neither complete assembly nor complete testing was necessary to find
`infringement”).
`
`Id. at 162. In light of this decision, the testing of software/systems that validate XBRL data
`constitutes infringement of the ‘842 patent.
`
`
`V.
`
`Documents Relating To Third Party Systems In The Government’s Possession
`
`
`
`
`
`The present litigation originated because the Government intervened in a litigation
`between e-Numerate and third parties in the District of Delaware. In that litigation, e-Numerate
`accused the third parties of infringing several of the patents-in-suit, inter alia, by using products
`and services to prepare XBRL compliant reports for filing with the SEC. To the extent the SEC
`and any other Government agency has documents relating to the design and operation of those
`third party systems (and others like those systems in the marketplace) in its possession, custody,
`and control, the Government should produce those documents as part of its document production
`pursuant to CFCPR 7(a).
`
`
`VI.
`
`The Government’s Production of Documents
`
`In light of the foregoing, e-Numerate believes there are non-publicly available
`systems/software at the SEC, the FDIC, and the FFEIC that infringe the ‘842 patent. In addition,
`e-Numerate believes there are potentially numerous systems/software that the Government is
`either presently using and/or developing to validate XBRL documents in use and/or in
`development at the DOE, FERC, Treasury, CFTC, OCC, FRS, and OTS. All of these systems
`are potential infringements of the ‘842 patent.
`
`It is e-Numerate’s position that the Government must produce documents relating to all
`of these systems pursuant to CFCPR 7(a) on February 19, 2021 pursuant to D.I. 38. If the
`Government disagrees, please advise immediately so that we can bring this issue promptly to the
`Court for resolution.
`
`To the extent the Government would like e-Numerate to amend its preliminary
`infringement contentions to set forth the foregoing, e-Numerate is willing to do that.
`
`
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`

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`Case 1:19-cv-00859-RTH Document 44-3 Filed 03/11/21 Page 7 of 7
`Shahar Harel, Esq.
`January 5, 2021
`Page 6
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`VII. Conclusion
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`
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`We look forward to hearing back from you about the foregoing.
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`Very truly yours,
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`Cc: All counsel of record (via electronic mail)
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`/s/ Gerard M. O’Rourke
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`Gerard M. O’Rourke
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