UNITED STATES PATENT AND TRADEMARK OFFICE
`______________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`______________
`
`LIBERTY MUTUAL INSURANCE CO.
`Petitioner
`
`v.
`
`PROGRESSIVE CASUALTY INSURANCE CO.
`Patent Owner
`______________
`
`Case CBM2012-00002
`Patent 6,064,970
`______________
`
`Before the Honorable JAMESON LEE, JONI Y. CHANG, and MICHAEL R.
`ZECHER, Administrative Patent Judges.
`
`PETITIONER LIBERTY MUTUAL INSURANCE CO.’S
`REPLY TO PATENT OWNER’S OPPOSITION TO LIBERTY’S MOTION
`TO EXCLUDE
`
`
`______________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`______________
`
`LIBERTY MUTUAL INSURANCE CO.
`Petitioner
`
`v.
`
`PROGRESSIVE CASUALTY INSURANCE CO.
`Patent Owner
`______________
`
`Case CBM2012-00002
`Patent 6,064,970
`______________
`
`Before the Honorable JAMESON LEE, JONI Y. CHANG, and MICHAEL R.
`ZECHER, Administrative Patent Judges.
`
`PETITIONER LIBERTY MUTUAL INSURANCE CO.’S
`REPLY TO PATENT OWNER’S OPPOSITION TO LIBERTY’S MOTION
`TO EXCLUDE
`
`
`
`Case CBM2012-00002
`Patent 6,064,970
`Petitioner1 hereby replies in support of its Motion to Exclude (“Mot.”, Paper
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`48) and in response to Progressive’s Opposition (“Opp.”, Paper 56). Ironically, Pro-
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`gressive’s strongest response here, as in other proceedings (e.g., CBM2012-00010), is
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`an imagined one: Progressive imagines Petitioner really made no motion at all, but ar-
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`gued, instead, that Progressive’s evidence should be admitted. (Cf. Opp. 2). Far from
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`it. While Petitioner acknowledges that the Board has broad discretion to admit and
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`consider evidence (Mot. 1-3), should the Board decide to apply the rules of evidence
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`strictly in the proceedings between these parties—as Progressive itself urges (e.g., Paper 51
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`(Progressive’s Motion to Exclude); CBM2012-00010, Paper 45 (same))—Progressive’s
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`unqualified “expert” testimony clearly fails under those rules, and should be excluded.
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`Progressive does not dispute Dr. Ehsani is unqualified to opine on insurance matters
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`(Mot. 5-6), but tries to explain away his sweeping substantive insurance testimony
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`with equally sweeping misstatements. While Progressive now tries to justify Dr.
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`Ehsani’s pronouncements about, e.g., “a fundamental change in operation for an actuarial class
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`approach” and a “totally different philosophical approach” from an “actuarial approach” by
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`saying they are simply “[b]ased on [1] his own expertise and [2] the assumption that an
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`‘actuarial approach’ involves ‘assignment to only one actuarial class for a particular risk category’”
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`(Opp. 4), this is false: (1) it is conceded that Ehsani has no insurance expertise, and (2) he
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`does not present the language now quoted by Progressive as an assumption—
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`1 All emphases are added and abbreviations are as in Petitioner’s Motion (Paper 48).
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`1
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`Case CBM2012-00002
`Patent 6,064,970
`instead, he states it to the Board as his opinion. See EX2016 ¶ 34 (affirmatively
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`reciting this as one of his “reasons” for concluding “a POSITA in the field of fuzzy logic2
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`would not consider the teachings of Kosaka when using a crisp group, such as an ac-
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`tuarial class”). The only “assumption” Ehsani states in his entire report is that “I have
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`been asked to assume that an ‘actuarial class’ has the following characteristics: an ac-
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`tuarial class, or risk class, is a grouping of risks (i.e., insureds) with similar risk charac-
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`teristics.” EX2016 ¶ 33. And, contrary to the suggestion in Progressive’s papers that
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`Dr. Ehsani was affirmatively “rel[ying] on an opinion offered by Progressive’s other
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`expert, Mr. Miller, as to characteristics of an actuarial class” (Opp. 3), Dr. Ehsani never
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`refers to, cites or mentions Mr. Miller anywhere in his declaration; nor did he identify the
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`declaration of Mr. Miller (Exhibit 2010) in his list of materials considered, or any-
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`where else. Contrast EX2016 with Opp. 5 (“Mr. Miller opined about insurance aspects,
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`and Dr. Ehsani properly relied on that pursuant to Rule 703”). Quite to the contrary,
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`other than the one narrow assumption quoted above, Dr. Ehsani tells the Board that
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`“all of [his] statements and opinions…are based on [his] training and education…”
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`EX2016 ¶ 2. No fair reading of Dr. Ehsani’s broad opinions about the nature, phi-
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`losophy, and fundamentals of an “actuarial approach” to insurance3 suggests they
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`2 Dr. Ehsani opines from the perspective of a different POSITA (“fuzzy logic”)—not
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`a POSITA in either the vehicle telematics or insurance aspects pertinent to the ‘970.
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`3 See also, e.g., EX2016 ¶ 29 (arguing, with no reference to Mr. Miller, that a POSITA
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`2
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`Case CBM2012-00002
`Patent 6,064,970
`could be derived from or supported by this single assumption that “an actuarial class,
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`or risk class, is a grouping of risks (i.e., insureds) with similar risk characteristics”:
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`there is simply no basis for Dr. Ehsani to offer the opinions that he does on insurance
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`issues. Contrast, e.g., EX2016 with RX1019 ¶ 8 (Petitioner’s expert opining on vehicle
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`telematics aspects declined to opine on insurance underwriting aspects); RX1022 ¶¶ 24-37
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`(Petitioner’s expert opining on insurance aspects limited opinion to rebutting Progres-
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`sive’s purported insurance expert, Mr. Miller); Opp. 5. Progressive’s mischaracteriza-
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`tion of Dr. Ehsani’s testimony in an attempt to defend it is simply breathtaking.
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`The suggestion Petitioner was obliged to depose Dr. Ehsani to give him a sec-
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`ond chance to explain himself (Opp. 5-6) is nonsense4: if Progressive had evidence to
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`show Ehsani was sufficiently qualified to opine on insurance matters, it could have
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`offered it in response to Petitioner’s clear objections (MX1035 § V; MX1036 §§ II,
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`III). 37 C.F.R. § 42.64(b)(2). It did not even try.
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`And the cases Progressive cites as supposed justification for Dr. Ehsani’s insur-
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`ance opinions (Opp. 3) actually confirm that his testimony should be excluded. In Carnegie
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`Mellon Univ. v. Marvell Tech. Grp., Ltd., 286 F.R.D. 266, 271 (W.D. Pa. 2012), the court
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`“would not know how to…apply [fuzzy logic] to the insurance industry”).
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`4 Instead, the Rules anticipate a “party challenging an expert’s qualifications may ques-
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`tion the expert’s qualifications during cross-examination and can raise the challenges in its
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`oppositions and, where appropriate, in a motion to exclude evidence.” 77 Fed. Reg. 48,643.
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`
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`3
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`
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`Case CBM2012-00002
`Patent 6,064,970
`excluded an expert’s testimony precisely because the expert was “not qualified” to testi-
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`fy on certain technical aspects. The court reasoned that even though “one expert may
`
`rely upon another expert’s opinion in formulating his own,” the expert’s testimony
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`“must be limited to his own area of expertise.” Id. Likewise, in an unreported
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`opinion in Member Servs., Inc. v. Sec. Mut. Life Ins. Co., No. 3:06-cv-1164 (TJM/DEP),
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`2010 WL 3907489, at *27 (N.D.N.Y. Sept. 30, 2010), the court precluded an expert’s
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`testimony where there was “substantial overlap” with another expert’s because “an
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`expert may not merely recite another expert’s opinion as his own.” Id. Thus, even if
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`Dr. Ehsani’s opinions had (unlike his actual testimony) been made in “rel[iance]” upon
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`Mr. Miller’s “opin[ing] about insurance aspects” of Kosaka (Opp. 5), Dr. Ehsani would
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`still not be qualified to opine on insurance matters, and Dr. Ehsani’s testimony resting
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`on his own supposed insurance opinions (see, e.g., EX2016 ¶¶ 28-34) should be ex-
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`cluded.
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`Finally, as explained in Petitioner’s Motion, “[w]hile an expert need not consid-
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`er every possible factor to render a reliable opinion,” there are limits: “the expert still must
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`consider enough factors to make his or her opinion sufficiently reliable in the eyes of the court.”
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`Mot. 6 (quoting Microstrategy Inc. v. Business Objects, S.A., 429 F.3d 1344, 1355 (Fed. Cir.
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`2005)). Dr. Ehsani, however, did not do so. Instead, he opined in broad contradic-
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`tion of prior art on the very topics of his testimony—art that would have been known
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`to any POSITA, e.g., Standard Oil Co. v. American Cyanamid Co., 774 F.2d 448, 454 (Fed.
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`Cir. 1985), such as a raft of earlier publications contradicting Progressive’s arguments
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`4
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`Case CBM2012-00002
`Patent 6,064,970
`that a POSITA would be unfamiliar with fuzzy logic, and demonstrating instead that
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`fuzzy logic was well-understood and known to be used for insurance by 1996. See
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`Mot. 6.5 The issue is not that Progressive’s expert personally ignored particular exam-
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`ples cited as evidence of a POSITA’s knowledge (cf. Opp. 7), but that more broadly he
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`ignored the relevant knowledge of a POSITA to reach his opinions, thus showing that
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`his testimony is not only unqualified, but also unreliable under F.R.E. 702(b). Similar-
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`ly, Dr. Ehsani’s opinion that Kosaka does “not provide any description as to what the
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`actual membership functions are” (Opp. 9, emphasis original) confirms the unreliabil-
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`ity of his testimony under F.R.E. 702: this testimony is (as the non-emphasized por-
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`tions of Progressive’s quote confirm) about the “mathematical specifications” of
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`membership functions to determine insurance risk: a topic Ehsani himself acknowledges
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`he is not qualified to address because he concedes this would require “intimate knowledge
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`of the application area” (EX2016 ¶ 17; Mot. 5), which he does not have. While Dr.
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`Ehsani has demonstrated his willingness to say almost anything about the Kosaka ref-
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`erence in an attempt to disparage it (see, e.g., Petitioner’s Reply at 7 n.8), he clearly has
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`not demonstrated his competence to do so. If the Board enforces its rules with Pro-
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`gressive’s argued strictness, Dr. Ehsani’s unqualified and unreliable testimony should
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`be excluded from this trial. At minimum, his testimony should be given no weight.
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`5 Progressive’s baseless assertions about the propriety of this evidence are addressed
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`in Petitioner’s Opposition to Progressive’s motion to exclude (Paper 57 at 3-6).
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`5
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`Respectfully submitted,
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`Case CBM2012-00002
`Patent 6,064,970
`
`
`
`
`
`
`ROPES & GRAY LLP
`
`
`By /J. Steven Baughman/
`J. Steven Baughman, Lead Counsel
`James R. Myers, Backup Counsel (pro hac vice)
`Nicole M. Jantzi, Backup Counsel
`ROPES & GRAY LLP
`700 12th St. NW, Suite 900
`Washington, DC 20005
`Steven.baughman@ropesgray.com
`James.myers@ropesgray.com
`Nicole.jantzi@ropesgray.com
`
`Attorneys for Petitioner Liberty Mutual Insurance Co.
`
`Mailing address for all PTAB correspondence:
`ROPES & GRAY LLP
`IPRM – Floor 43
`Prudential Tower
`800 Boylston Street
`Boston, Massachusetts 02199-3600
`
`6
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`October 17, 2013
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`CERTIFICATE OF SERVICE
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`It is certified that a copy of PETITIONER LIBERTY MUTUAL INSUR-
`
`ANCE CO.’S REPLY TO PATENT OWNER’S OPPOSITION TO LIBER-
`
`TY’S MOTION TO EXCLUDE has been served in its entirety on the Patent
`
`Owner as provided in 37 CFR § 42.6.
`
`The copy has been served on October 17, 2013 by causing the aforementioned
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`document to be electronically mailed to:
`
`Calvin P. Griffith, at: cpgriffith@jonesday.com
`
`James L. Wamsley, III at: jlwamsleyiii@jonesday.com
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`John V. Biernacki at: jvbiernacki@jonesday.com
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`pursuant to the Petitioner and Patent Owner’s agreement.
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`
`
`
`
` /s/ Jordan M. Rossen
`Jordan M. Rossen
`
`ROPES & GRAY LLP
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`
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