IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`
`
`
`Attorney Docket No.:
`§
`
` 104677-5005-802
`§
`§ Customer No. 28120
`§
`§
`§
`§
`
`Petitioner: Apple Inc.
`
`Inventor: Hair
`United States Patent No.: 5,191,573
`Formerly Application No.: 586,391
`Issue Date: March 2, 1993
`Filing Date: September 18, 1990
`Former Group Art Unit: 339
`Former Examiner: Hoa T. Nguyen
`
`For: Method for Transmitting a Desired Digital Video or Audio Signal
`
`MAIL STOP PATENT BOARD
`Patent Trial and Appeal Board
`United States Patent and Trademark Office
`Post Office Box 1450
`Alexandria, Virginia 22313-1450
`
`
`DECLARATION OF DR. JOHN P. J. KELLY IN SUPPORT OF APPLE
`INC.’S PETITION FOR COVERED BUSINESS METHOD PATENT
`REVIEW OF UNITED STATES PATENT NO. 5,191,573 PURSUANT TO 35
`U.S.C. § 321, 37 C.F.R. § 42.304
`
`
`
`
`
`
`
`
`
`Apple Exhibit 1132 Page 00001
`
`
`
`
`
`Attorney Docket No.:
`§
`
` 104677-5005-802
`§
`§ Customer No. 28120
`§
`§
`§
`§
`
`Petitioner: Apple Inc.
`
`Inventor: Hair
`United States Patent No.: 5,191,573
`Formerly Application No.: 586,391
`Issue Date: March 2, 1993
`Filing Date: September 18, 1990
`Former Group Art Unit: 339
`Former Examiner: Hoa T. Nguyen
`
`For: Method for Transmitting a Desired Digital Video or Audio Signal
`
`MAIL STOP PATENT BOARD
`Patent Trial and Appeal Board
`United States Patent and Trademark Office
`Post Office Box 1450
`Alexandria, Virginia 22313-1450
`
`
`DECLARATION OF DR. JOHN P. J. KELLY IN SUPPORT OF APPLE
`INC.’S PETITION FOR COVERED BUSINESS METHOD PATENT
`REVIEW OF UNITED STATES PATENT NO. 5,191,573 PURSUANT TO 35
`U.S.C. § 321, 37 C.F.R. § 42.304
`
`
`
`
`
`
`
`
`
`Apple Exhibit 1132 Page 00001
`
`
`
`I, John Kelly, hereby declare as follows:
`
`
`
`I. INTRODUCTION
`
`1.
`
`I have been retained to provide assistance regarding U.S. Patent No.
`
`5,191,573 (“’573 patent”). Attached hereto as Appendix A is a true and correct
`
`copy of my Curriculum Vitae describing my background and experience. I have
`
`personal knowledge of the facts and opinions set forth in this declaration, and, if
`
`called upon to do so, I would testify competently thereto.
`
`2.
`
`I hold Bachelor of Arts and Master of Arts degrees with Honors in
`
`Mathematics from the University of Cambridge, England. I hold a Ph.D. in
`
`Computer Science from U.C.L.A. From 1982 through 1986, I was a professor in
`
`the Computer Science Department at U.C.L.A. From 1986 through 1997, I was a
`
`professor in the Electrical and Computer Engineering Department of the University
`
`of California, Santa Barbara, where I held tenure.
`
`3.
`
`I am the principal of Kelly Computing, Inc. I teach and consult in
`
`many different aspects of computer science and engineering, including computer
`
`hardware and software architecture and design, software engineering and fault
`
`tolerance. My particular areas of expertise include computer architecture, software
`
`engineering and “clean-room” development and evaluation, reverse engineering,
`
`operating systems (including real-time and embedded), network computing
`
`
`
`
` 2
`
`
`
`Page 00002
`
`
`
`
`
`(including Internet computing), storage systems, fault tolerance, parallel and
`
`distributed computing systems, transaction processing systems, database systems,
`
`and program management.
`
`4.
`
`As a result of my education and professional experience, I have
`
`extensive development experience and knowledge of computer operating systems
`
`including access control concepts, data encryption/decryption techniques,
`
`networking technologies, database systems, communication protocols including
`
`network communication protocols, user interfaces including graphical user
`
`interfaces and computer hardware design, and software analysis, design, and
`
`development. I have developed computer software and hardware for many
`
`different computer systems and applications including programming
`
`microprocessors. I have also analyzed several software products related to access
`
`control, audio and video playback, network transmission of audio and video,
`
`storage of audio and video in multimedia databases, and content delivery networks
`
`and distribution systems. For example, I have analyzed databases and repositories
`
`used to store and access audio file repositories, network based distribution of
`
`electronic media, set top boxes, and content delivery network architecture of
`
`leading content delivery network providers. I have also analyzed the source code
`
`for computer operating systems such as Apple’s Mac OS X, Microsoft Windows,
`
`
`
`
` 3
`
`
`
`Page 00003
`
`
`
`
`
`Linux, etc. I have also testified in Court on several occasions as a computer
`
`science expert to report my analysis and opinions.
`
`5.
`
`I have worked in the area of computer software, hardware and system
`
`design and development for over thirty-five years. I have extensive experience in
`
`the design and development of small and large scale software systems. I have been
`
`involved in the specification, development, integration, and testing of computer
`
`systems with a wide range of requirements, sizes and types. These have included,
`
`by way of example, custom hardware and software for a US Air Force fighter
`
`plane, a distributed real-time system for US FAA air traffic control, and a
`
`distributed geographical information system for the US Department of Energy.
`
`6.
`
`From 1978 to 1995, I specified, designed and implemented distributed
`
`database architectures, systems and applications for Los Alamos National
`
`Laboratory and NASA’s Jet Propulsion Laboratory and database machine design
`
`and implementation at Transaction Technology Incorporated, Ordain, Inc. and
`
`Teradata.
`
`7.
`
`From 1985 to 1998, I consulted for AT&T GIS, NCR, Symbios Logic,
`
`and LSI Logic, including working as a member of the AT&T GIS Science
`
`Advisory Committee (“SAC”). The SAC evaluated AT&T’s organization,
`
`technical direction and product strategy and made recommendations to the Vice
`
`President of Technology and Development.
`
`
`
`
`
` 4
`
`Page 00004
`
`
`
`
`
`8.
`
`A listing of testimony that I have provided in the last four years and
`
`my compensation is attached hereto as Appendix B. I am being compensated for
`
`my time spent in connection with this case. I have no financial interest in the
`
`outcome of this case.
`
`9.
`
`In preparing my opinions, I have considered the following materials:
`
`• ’573 patent [Ex. 1101],
`
`• ’573 patent file history [Ex. 1102],
`
`• ’573 patent reexamination [Ex. 1103],
`
`• Arthur Hair Dec. 11, 2012 Dep. Tr. [Ex. 1104],
`
`• Scott Sander Dec. 18-19, 2012 Dep. Tr. [Ex. 1105],
`
`• Steven Dupler, Joint Telerecording Push: CompuSonics, AT&T Link,
`
`Billboard, vol. 97, no. 40, Oct. 5, 1985 (“Dupler article”) [Ex. 1106],
`
`• David Needle, From the News Desk: Audio/digital interface for the IBM
`
`PC?, InfoWorld, vol. 6, no. 23, p. 9, June 4, 1984 (“Needle article”) [Ex.
`
`1107],
`
`• Larry Israelite, Home Computing: Scenarios for Success, Billboard, Dec. 15,
`
`1984 (“Israelite article”) [Ex. 1108],
`
`• “Digital Audio Telecommunication System” diagram, ©1985 [Ex. 1112],
`
`• David Schwartz, July 16, 1984 Letter to CompuSonics’ Shareholders, July
`
`
`
`
` 5
`
`
`
`Page 00005
`
`
`
`
`
`16, 1984 (“Schwartz 1984 Letter”) [Ex. 1113],
`
`• Hyun Heinz Sohn, A High Speed Telecommunications Interface for Digital
`
`Audio Transmission and Reception, 76th AES Convention, Oct. 1984 (“Sohn
`
`article”) [Ex. 1114],
`
`• David Schwartz, October 10, 1985 Letter to CompuSonics’ Shareholders,
`
`Oct. 10, 1985 (“Schwartz 1985 Letter”) [Ex. 1115],
`
`• CompuSonics Video, Application Notes: CSX Digital Signal Processing,
`
`1986 (“Application Note”) [Ex. 1116],
`
`• “Digital Audio Software Production/Distribution” diagram [Ex. 1117],
`
`• U.S. Patent No. 4,682,248 (“Schwartz patent”) [Ex. 1118],
`
`• Brian Dumaine, The Search for the Digital Recorder, Fortune, p. 116, Nov.
`
`12, 1984 (“Dumaine article”) [Ex. 1119],
`
`• 1987 Stanford lecture (“Stanford lecture”) [Ex. 1120],
`
`• Bryan Bell, Synth-Bank: The Ultimate Patch Library, Electronic Musician,
`
`Sept. 1986, p. 26 (“Synth-Bank article”) [Ex. 1121],
`
`• Agreement between Synth-Bank and an Artist dated 2/22/1986 (“Synth-
`
`Bank agreement”) [Ex. 1122];
`
`• U.S. Patent And Trademark Office, Trademark File History for the Synth-
`
`Bank mark (“Synth-Bank TM history”) [Ex. 1123],
`
`
`
`
` 6
`
`
`
`Page 00006
`
`
`
`
`
`• Keyboard, vol. 13, no. 3, March 1987, p. 145 (“Keyboard article”) [Ex.
`
`1124],
`
`• Inside Macintosh Volumes I, II and III, 1985 (“Inside Macintosh”) [Ex.
`
`1125],
`
`• The Technical Development of Internet Email” by Craig Partridge, IEEE
`
`Annals of the History of Computing (Berlin: IEEE Computer Society) 30
`
`(2): 3–29 (“Partridge article” [Ex. 1126],
`
`• United States Patent 5,966,440 file history [Ex. 1127],
`
`• United States Patent No. 4,124,773 (“Elkins patent”) [Ex. 1128],
`
`• U.S. Patent 4,667,088 (“Kramer patent”) [Ex. 1129],
`
`• U.S. Patent No. 4,528, 643 (“Freeny patent”) [Ex. 1130],
`
`• Photograph of CompuSonics equipment [Ex. 1131],
`
`• Declaration of David Schwartz [Ex. 1133],
`
`• Special Master’s Report And Recommendation On Claim Construction
`
`dated Nov. 19, 2012 in the matter of SightSound Technologies, LLC v.
`
`Apple, Inc. (“Claim Construction Recommendation”) [Ex. 1134],
`
`• Order re Claim Construction dated 2/13/13 in the matter of SightSound
`
`Techs., LLC v. Apple Inc. [Ex. 1135],
`
`• New Telerecording Method for Audio, Broadcast Management/Engineering,
`
`
`
`
` 7
`
`
`
`Page 00007
`
`
`
`
`
`Oct. 1985 (“Telerecording article”) [Ex. 1140].
`
`II. OPINIONS REGARDING A PERSON OF ORDINARY SKILL IN THE
`ART
`
`10.
`
`I understand that the factors considered in determining the ordinary
`
`level of skill in the art include the level of education and experience of persons
`
`working in the field; the types of problems encountered in the field; and the
`
`sophistication of the technology.
`
`11.
`
`In my opinion, a person of ordinary skill in the art relating to the
`
`technology of the asserted patents at the time at which the patents were filed would
`
`have had a bachelor’s degree or equivalent in computer engineering or computer
`
`science and approximately two years of experience in developing software and
`
`hardware that transmit and receive files over a network.
`
`12.
`
`I understand that the U.S. District Court in the matter of SightSound
`
`Technologies, LLC v. Apple, Inc. has determined that a person of ordinary skill in
`
`the art relating to the technology of the asserted patents at the time at which the
`
`patents were filed is a person having an undergraduate degree in electrical
`
`engineering or computer science and/or approximately 2-4 years of industry
`
`experience in the design of systems and methods for storing and transmitting
`
`
`
`
` 8
`
`
`
`Page 00008
`
`
`
`
`
`digital information. [See Ex. 1134 (Claim Construction Recommendation) at p.
`
`12, fn.12; see also Ex. 1135]
`
`13.
`
`In 1988, I would have exceeded the level of skill required by either
`
`definition, and I am in a position to opine on the understanding of a person of
`
`ordinary skill in the art. In addition, my opinions are the same under both
`
`definitions.
`
`III. CLAIM CONSTRUCTION
`
`14. For the purposes of this declaration, I have been asked to assume
`
`constructions for certain claim terms as presented in the following table. For all
`
`remaining claim terms, I have assumed their plain and ordinary meaning.
`
`Claim Construction
`a first entity, whether a corporation or a real person
`a second entity, whether a corporation or a real person
`an electronic medium for communicating between
`computers.
`through the flow of electrons.
`connecting through devices or systems which depend
`on the flow of electrons.
`transferring through devices or systems which depend
`on the flow of electrons.
`providing payment electronically (i.e., through devices
`or systems which depend on the flow of electrons).
`digital representations of sound waves
`
`
`
`
`
` 9
`
`Term
`First Party
`Second Party
`
`Telecommunication Lines
`
`Electronically
`“Connecting
`Electronically” Terms
`“Transferring
`Electronically” Terms
`“Transferring Money
`Electronically” Terms
`Digital Audio Signal
`
`Page 00009
`
`
`
`
`
`
`
`IV.
`
`THE ’573 PATENT
`
`A. OVERVIEW OF THE ’573 PATENT
`
`
`
`Figure 1. Overview of the ’573 patent. The first party’s system (components
`on the left side of the figure) are connected to the second party’s system
`(components on the right side of the figure) by telephone lines. [See Ex. 1101
`(’573 patent) at Fig. 1]
`
`
`
`15. The ’573 patent issued on March 2, 1993, from U.S. Patent
`
`Application No. 07/586,391 (“’391 application”), which was filed on Sept. 18,
`
`1990. For the purpose of this declaration only, I have been asked to assume that
`
`the priority date of the ’573 patent is June 13, 1988.
`
`16. The ’573 patent is directed to a system and method for the sale and
`
`transmission of audio and video signals. [See, e.g., Ex. 1101 (’573 patent) at
`
`Abstract] The audio and/or video signals are stored on the system of the seller
`
`
`
`
`10
`
`Page 00010
`
`
`
`
`
`(“first party”). [See, e.g., Ex. 1101 (’573 patent) at 3:60-63] A buyer (“second
`
`party”) can purchase audio or video signals, transfer these signals over telephone
`
`lines, and store the signals on the buyer’s system. [See, e.g., Ex. 1101 (’573
`
`patent) at 3:44-4:47, Fig. 1] The buyer can then play the audio or video signals
`
`stored on the buyer’s system. [See Ex. 1101 (’573 patent) at 4:52-5:2]
`
`V. THE INVALIDATING PRIOR ART
`
`A. OVERVIEW OF THE STATE OF THE ART
`
`17.
`
`In June of 1988 – at the time of the filing of the ’497 application, now
`
`abandoned, from which SightSound claims priority for the ’573 patent – the
`
`elements of the asserted claims in this case were already well known in the art for
`
`digital data, including audio and video. Storing data, including audio and video
`
`data, at a remote server was well known. Downloading data from a remote server
`
`to a local computer was a well-known method of obtaining data. The electronic
`
`sale of merchandise, including digital data, was also well-known.
`
`18. The sole named inventor of the ’573 patent, Arthur Hair, agrees that
`
`he did not invent, among other things, electronic sales, the electronic transmission
`
`of digital audio signals, the electronic transmission of digital video signals, the
`
`electronic transmission of digital content such as computer programs for electronic
`
`
`
`
`11
`
`Page 00011
`
`
`
`
`
`sale, the electronic transmission of MIDI files for electronic sale, or the capability
`
`of playing digital audio signals, digital video signals, hard disks, telephone lines,
`
`compact disc players, video display units or stereo speakers. [See, e.g., Ex. 1104
`
`(Hair Dec. 11, 2012 Dep. Tr.) at pp. 49-52; Ex. 1127 (Declaration of Arthur Hair
`
`dated January 9, 1998, attached to applicant’s Response during prosecution of U.S.
`
`Patent Application No. 08/471,9641); Ex. 1101 (’573 patent) at 4:16-21; see also
`
`Ex. 1101 (’573 patent) at 1:50-53, 1:63-64; Ex. 1105 (Sander Dec. 18-19, 2012
`
`Dep. Tr.) at pp. 42-44]
`
`19. Computer scientists, engineers and users have long recognized the
`
`advantages of connecting computers together so that they can share information.
`
`Over the years many different technologies have been developed to connect
`
`computers into networks for this purpose. Some technologies work over shorter
`
`distances and are appropriate for creating local-area networks (LANs) while other
`
`technologies can span longer distances and are used to create wide-area networks
`
`(WANs). Some of the technologies used for WAN connections included the “plain
`
`old telephone system” (POTS), dedicated telephone lines, fiber optic lines and
`
`satellite links.
`
`20. By June 1988, since most homes had telephone lines, the telephone
`
`system was a popular method of connecting a home computer to a remote
`
`1 The ’964 application issued as U.S. Patent No. 5,966,440.
`
`
`
`12
`
`Page 00012
`
`
`
`
`
`computer. A modem was used on each side of the telephone call in order to
`
`convert and send digital data over the analog telephone lines. The rate at which
`
`data was sent over the telephone line depended on the kind of modem used. For
`
`example, the International Telecommunication Union (ITU) published standards
`
`for a 1200 bps2 modem in 1980 (Recommendation V.22), a 9600 bps modem in
`
`1984 (Recommendation V.32) and a 14.4 kbps modem in 1991 (Recommendation
`
`V.32bis). By 1988, 1200 and 2400 baud modems were in common use. In 1988,
`
`higher speed home options such as cable television systems were not commonly
`
`used. Businesses that required higher speed network access often leased a
`
`dedicated line (e.g., a T1 line with a speed of approximately 1.5 Mbps).
`
`21. Prior to June 1988, computer users accessed remotely-stored data in a
`
`wide variety of ways such as email, FTP sites, Bulletin Board Systems (BBSs),
`
`online services, etc. I will give a brief description of some of these methods.
`
`22. Email systems consist of user agents (the email client programs that
`
`allow a user to create, send and manage email messages) and mail transfer agents
`
`(email servers that move mail messages across the network). Computer users were
`
`sending email messages across the ARPANET (a precursor to the Internet) in the
`
`
`2 “bps” means bits per second. “kbps” means kilobits per second or thousands of
`bits per second. “Mbps” means megabits per second or millions of bits per second.
`
`
`
`13
`
`Page 00013
`
`
`
`
`
`1970s. [See, e.g., Ex. 1126 (Partridge article)3] Although email messages were
`
`initially text only, methods of supporting binary objects such as graphics and sound
`
`were under development in the 1980s. [See also Ex. 1126 (Partridge article) at pp.
`
`24-27]
`
`23. The File Transfer Protocol (“FTP”), as its name suggests, is a protocol
`
`for transferring files to or from a server computer over a network. The user
`
`interacts with the FTP server using an FTP client program. FTP servers have been
`
`used for distributing software and many other types of files. Any type of computer
`
`file, including audio and video file types, could be transferred by FTP. The FTP
`
`standard (RFC114) was published in 1973.
`
`24. A Bulletin Board System (BBS) is a computerized system for
`
`allowing remote users to upload/download software and other files, to read news,
`
`exchange messages with other users, etc. Most BBSs provided access through
`
`modems and the phone system. Some BBSs were free while others operated on a
`
`subscription basis. Online services such as Delphi were similar to BBSs and
`
`provided access to many kinds of information and services.
`
`
`3 http://www.ir.bbn.com/~craig/email.pdf.
`
`
`
`14
`
`Page 00014
`
`
`
`
`
`25. By June 1988, devices for playing digital audio and video were also
`
`well known. For example, in 1978, United States Patent No. 4,124,773 to Elkins4
`
`(Ex. 1128) described a system for distributing digitized audio programs from a
`
`master data bank to remote users. [See Figure 2] The audio programs were
`
`digitized and stored in a digital storage subsystem for “later retrieval.” [See, e.g.,
`
`Ex. 1128 (Elkins patent) at 3:16-19, 3:46, 49] The user could send a code to the
`
`master data bank representing a desired audio program, which was then delivered
`
`to the user over telephone lines or another communication medium.
`
`“As a user located at a remote location desires to listen to a selected
`one of the programs, the operator actuates the command signal
`generator 100 with a code representing the selected one of the stored
`programs. A
`command
`signal
`is
`transmitted
`along
`the
`communications circuit 59 and interpreted by the digital interrogator
`50. The digital interrogator 50 then retrieves the selected one of the
`stored digital signals from the digital storage subsystem 42. The
`digital signal is then reformatted by the data reformatter 56 and
`transmitted along the communications circuit 59.” [Ex. 1128 (Elkins
`patent) at 6:16-27]
`
`The user’s device contained storage, analog to digital converter, amplifier and
`
`transducer to convert the digitized audio programs into sound waves (i.e., play the
`
`
`4 United States Patent No. 4,124,773 to Elkins, titled “Audio storage and
`distribution system,” was filed November 26, 1976, and issued November 7, 1978.
`
`
`
`15
`
`Page 00015
`
`
`
`
`
`digitized audio programs). [See Figure 2] Second, CD players were common in
`
`the 1980s. Third, some types of personal computers could play digital audio. The
`
`Apple Macintosh, for example, had built-in speakers and sound generator circuitry.
`
`[See, e.g., Ex. 1125 (Inside Macintosh)] Similarly, some computers, such as the
`
`Apple Macintosh, and other devices could play digital video. Fourth, even
`
`portable audio players had been developed. For example, in 1987, U.S. Patent
`
`4,667,088 to Kramer et al.5 (Ex. 1129) disclosed a credit card size portable audio
`
`player. The 8 MB bubble memory on the device stored the digitized audio data.
`
`This memory could store 3.5 minutes of audio using the DPCM method for
`
`encoding the audio. [See, e.g., Ex. 1129 (Kramer patent) at Abstract, 3:8-41] The
`
`audio could be played through speakers or headphones. [See, e.g., Ex. 1129
`
`(Kramer patent) at 5:55-65, 6:6-12]
`
`
`5 U.S. Patent 4,667,088 to Kramer et al., titled “Portable data processing and
`storage system,” was filed Nov. 1, 1982, and issued May 19, 1987.
`
`
`
`16
`
`Page 00016
`
`
`
`
`
`
`
`Figure 2. An illustration of the system of Elkins. The components in the red
`box are at the master data bank. The components in the green box are the
`user’s device. [See Ex. 1128 (Elkins patent) at Fig. 1 (emphasis added)]
`
`
`
`26. Electronic sale of goods and services was also well known. For
`
`example, David Schwartz, president of CompuSonics Corporation, said of the
`
`“Electronic Record Store” concept that “All of the technology that makes this
`
`possible has been proven by many people, ourselves among them.” [See, e.g., Ex.
`
`
`
`
`17
`
`Page 00017
`
`
`
`
`
`1120 (Stanford lecture) at parts 9-10; see also § V.B below] The advantages to the
`
`consumer of access to online services were discussed in a 1984 article in Billboard:
`
`“A fully integrated home computer will enable us to do our banking,
`buy groceries, pay bills, set up doctor's appointments, and help our
`children do their homework. The computer will also show local
`movie schedules, let us study the menus from our favorite restaurants,
`and allow us to order and pay for concert and theatre tickets. It will
`remind us to mail birthday cards, take the car in for service, and call
`the baby sitter.” [Ex. 1108 (Israelite article) at p. 4]
`
`This Billboard article also discussed online sales scenarios.
`
`“One evening you decide that you would like to own a copy of the
`soundtrack of the video clip you just watched on MTV. You change
`the channel (using the keyboard on your home entertainment control
`module) so you can find out the name of the song and the access
`number under which it is stored in the cable company’s data base.
`Then, after you load a floppy disk into your DSP-1000, you dial up
`the cable station, enter the access code and a ‘send data’ code. When
`you receive a ‘data transmission complete’ signal, the process is
`finished. The floppy disk now will contain the song, stored in digital
`form. All charges associated with the data transfer will be itemized
`on your monthly cable service bill, which you can see on the monitor
`if you so choose.” [Ex. 1108 (Israelite article) at p. 4]
`
`“If the consumer had access to a computer and to a service like
`Yellow Data … he or she could look through a data base of songs
`
`
`
`18
`
`Page 00018
`
`
`
`
`
`available in digital form, indicate those wished to purchase, type in a
`charge card number and address, and the floppy disc would arrive in
`the mail two days later.” [Ex. 1108 (Israelite article) at p. 5]
`
`“Thus, as other forms of entertainment (e.g., video) are digitized, they,
`too, will become candidates for these scenarios.” [Ex. 1108 (Israelite
`article) at p. 4]
`
`27. The advantages to businesses and consumers of electronic distribution
`
`and sales, for example, of digital music, were known:
`
`“Thus, the owner of the information embodied in recordings faced the
`configuration problem (how many phonograph records are to be
`manufactured, how many 8-track tapes are to be manufactured and
`how many reel-to-reel tapes are to be manufactured), and then the
`owner of such recording
`information faced
`the problems of
`distributing such material objects to retail outlets and attempting to
`collect for the sale of such material objects… The system of the
`present invention solves the problems associated with manufacturing,
`inventory, configuration distribution and collection previously
`discussed and permits sale of material objects embodying information
`in a more efficient, economical and profitable manner.” [Ex. 1130
`(Freeny patent6) at 1:64-2:4, 4:13-18]
`
`“The author and his colleagues at CompuSonics Corporation see great
`potential for expanding the music market through digital technology.
`
`6 U.S. Patent No. 4,528, 643 to Freeny was filed on Jan. 10, 1983 and issued on
`July 9,1985.
`
`
`
`
`19
`
`Page 00019
`
`
`
`
`
`Imagine that a large database of the latest music chart successes exist
`only a phone call away. Video music services which broadcast over
`cable networks can simultaneously release new album and have it
`ready for immediate sale without first having filled the distribution
`pipeline. In fact, a trend of selling the music, not the media would
`have been set. This would reduce expensive inventory and shipping
`costs and at the same time assure a supply of recording that can meet
`any demand.” [Ex. 1114 (Sohn Article) at p. 11]
`
`Thus, amongst other benefits, electronic sales reduces manufacturing and shipping
`
`costs for businesses, and increases choice and convenience for consumers.
`
`28. As can be appreciated from the above review, practitioners in the art
`
`knew how to build the components of an audio distribution and listening system.
`
`In addition, the limitations of such systems at the time were well known. Many of
`
`the technological issues that minimized the commercial viability of such systems at
`
`the time related to the amount of digital data required for digital audio and digital
`
`video. For example, approximately 36 MB of data is required to represent 3.5
`
`minutes of CD-quality digital audio. Digital video is even more voluminous.
`
`Uncompressed, low-definition television video requires about 10 MB7 per second
`
`
`7 512 lines per frame by 512 samples per line by 1 byte per sample by 30 frames
`per second equals about 8 million bytes per second, which does not include the
`overhead for control data.
`
`
`
`
`20
`
`Page 00020
`
`
`
`
`
`or 2,100 MB for 3.5 minutes. [See, e.g., Ex. 1118 (Schwartz patent8) at 3:7-13]
`
`Even though methods of compressing digital data were known, both compressed
`
`digital audio and compressed digital video still required large amounts of data.
`
`[See, e.g., Ex. 1129 (Kramer patent) and Ex. 1118 (Schwartz patent)] Recall that
`
`8MB of data was still required for 3.5 minutes of digital music compressed using
`
`the DPCM method. Even if a video were compressed by a factor of 100, a single
`
`90 minute movie would require about 540 MB of data assuming a data rate of
`
`10 MB/second.
`
`29. The first problem was how to transfer such a large file to the user’s
`
`personal computer in a reasonable amount of time (minutes or seconds instead of
`
`hours). Transfer of data over telephone lines was known to be very slow.
`
`“One medium that is currently used for shipping digital data over long
`distances is telephone lines. Unfortunately, the speed at which data
`can be shipped over existing phone lines is relatively slow (1,200
`single pieces of information per second), and the error rate is
`relatively high. This makes shipment of large amounts of data via this
`medium somewhat difficult.” [Ex. 1108 (Israelite article) at p. 4]
`
`Downloading a single uncompressed song in digital format could take more than a
`
`day. Even if the digital audio data is compressed, the download time for a song is
`
`8 U.S. Patent No. 4,682,248 to David M. Schwartz; titled “Audio and video digital
`recording and playback system,” was filed September 17, 1985 and issued July 21,
`1987 (“Schwartz patent”).
`
`
`
`
`21
`
`Page 00021
`
`
`
`
`
`still several hours: for example, downloading 8MB of data (approximately one
`
`song compressed using DPCM) would require about 8 hours at 2,400 bps.
`
`Downloading a 540 MB movie at 2,400 bps would take about 500 hours. In
`
`addition to being slow, it was not uncommon for a modem to drop a call or
`
`encounter an error that required restarting the file download from the beginning.
`
`30. The second problem was how to store such large files for later
`
`playback. This requires a non-volatile medium (i.e., a medium that retains its
`
`contents when power is removed) capable of storing a reasonable size library of
`
`songs or videos. Non-volatile storage devices included CD-ROMs (a read-only
`
`medium), Write-Once-Read-Many (“WORM”) optical disks, tapes, floppy disks,
`
`hard drives and bubble memory (a solid state memory). The floppy drives
`
`commonly used in personal computers had relatively low capacity (under 1.5 MB).
`
`Therefore, a single floppy disk was large enough to hold only about 40 seconds of
`
`digital music encoded using the DPCM method utilized by Kramer, not enough for
`
`even one song. The solid state memory used by Kramer also had relatively low
`
`capacity. It was large enough to hold only a single song compressed using the
`
`DPCM method. Hard drives were larger (for example, the Apple Macintosh IIx in
`
`1988 could have an 80MB hard drive) but relatively expensive. An 80MB hard
`
`drive would be large enough to hold only about 10 songs compressed using the
`
`
`
`
`22
`
`Page 00022
`
`
`
`
`
`DPCM method. Again, digital video files were even larger. A 540 MB video
`
`would not fit on such a hard drive.
`
`31.
`
`If improved networking bandwidth and larger capacity memories
`
`could be provided to one of ordinary skill in the art, then a commercially attractive
`
`audio distribution system involving a remote server and a personal player could
`
`have been built using known techniques with predictable results. However, the
`
`’573 patent did not address the problems of bandwidth or storage.
`
`B.
`
`COMPUSONICS SYSTEM
`
`32. CompuSonics Corp. and CompuSonics Video Corp. (“CompuSonics”)
`
`developed digital audio and video recorder/players, and related technology in order
`
`to, amongst other things, facilitate electronic record sales. In addition,
`
`CompuSonics patented its technology, publicly demonstrated its recorder/players,
`
`and discussed the intended uses for which its recorder/players were designed
`
`(including its plans for electronic sale of music) in the media. Collectively, the
`
`technology and its use for distribution and sale of digital media are the
`
`“CompuSonics system.” Some of the publications that describe the CompuSonics
`
`system [see Ex. 1133 (Declaration of David Schwartz) at ¶¶ 5-19] are
`
`• David Needle, From the News Desk: Audio/digital interface for the IBM
`
`PC?, InfoWorld, vol. 6, no. 23, p. 9, June 4, 1984 (Ex. 1107);
`
`
`
`23
`
`Page 00023
`
`
`
`
`
`• David Schwartz, July 16, 1984 Letter to CompuSonics’ Shareholders, July
`
`16, 1984 (Ex. 1113);
`
`• Hyun Heinz Sohn, A High Speed Telecommunications Interface for Digital
`
`Audio Transmission and Reception, 76th AES Convention, Oct. 1984 (Ex.
`
`1114);
`
`• Brian Dumaine, The Search for the Digital Recorder, Fortune, p. 116, Nov.
`
`12, 1984 (Ex. 1119);
`
`• New Telerecording Method for Audio, Broadcast Management/Engineering,
`
`Oct. 1985 (Ex. 1140);
`
`• Steven Dupler, Joint Telerecording Push: CompuSonics, AT&T Link,
`
`Billboard, vol. 97, no. 40, Oct. 5, 1985 (Ex. 1106);
`
`• David Schwartz, October 10, 1985 Letter to CompuSonics’ Shareholders,
`
`Oct. 10, 1985 (Ex. 1115);
`
`• CompuSonics Video, Application Notes: CSX Digital Signal Processing,
`
`1986 (Ex. 1116);
`
`• U.S. Patent No. 4,682,248 to David M. Schwartz; filed September 17, 1985;
`
`issued July 21, 1987 (Ex. 1118);
`
`• “Digital Audio Telecommunication System” diagram, ©1985 (Ex. 1112);
`
`• “Digital Audio Software Production/Distribution” diagram (Ex. 1117);
`
`
`
`
`24
`
`Page 00024
`
`
`
`
`
`• 1987 Stanford lecture (Ex. 1120).
`
`1.
`
`Digital Recording/Playback Device
`
`33. CompuSonics produced and sold a line of digital recording and
`
`playback devices. Amongst other features, these recorder/players were capable of
`
`creating and storing a digital recording from analog audio source; playing a stored
`
`digital recording through speakers; and receiving and storing a digital recording
`
`from another computer over a communications interface. The DSP-1000 Home
`
`Digital Disk Recorder is shown in Figure 3. The “DSP-1000 was selected as one
`
`of 1984’s ‘Most Innovative Consumer Electronics Products’” at the
Accessing this document will incur an additional charge of $.
After purchase, you can access this document again without charge.
Accept $ Charge
Still Working On It
This document is taking longer than usual to download. This can happen if we need to contact the court directly to obtain the document and their servers are running slowly.
Give it another minute or two to complete, and then try the refresh button.
A few More Minutes ... Still Working
It can take up to 5 minutes for us to download a document if the court servers are running slowly.
Thank you for your continued patience.
This document could not be displayed.
We could not find this document within its docket. Please go back to the docket page and check the link. If that does not work, go back to the docket and refresh it to pull the newest information.
Your account does not support viewing this document.
You need a Paid Account to view this document. Click here to change your account type.
Your account does not support viewing this document.
Set your membership
status to view this document.
With a Docket Alarm membership, you'll
get a whole lot more, including:
- Up-to-date information for this case.
- Email alerts whenever there is an update.
- Full text search for other cases.
- Get email alerts whenever a new case matches your search.
One Moment Please
The filing “” is large (MB) and is being downloaded.
Please refresh this page in a few minutes to see if the filing has been downloaded. The filing will also be emailed to you when the download completes.
Your document is on its way!
If you do not receive the document in five minutes, contact support at support@docketalarm.com.
Sealed Document
We are unable to display this document, it may be under a court ordered seal.
If you have proper credentials to access the file, you may proceed directly to the court's system using your government issued username and password.
Access Government Site
