throbber

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`Filed on behalf of:
`
`Patent Owner SightSound Technologies, LLC
`
`By: David R. Marsh, Ph.D.
`
`Jennifer A. Sklenar
`
`Kristan L. Lansbery, Ph.D.
`ARNOLD & PORTER LLP
`555 12th Street, N.W.
`Washington, DC 20004
`Tel: (202) 942-5068
`Fax: (202) 942-5999
`
`
`
`
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`_______________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`_______________
`
`APPLE INC.,
`
`Petitioner,
`
`v.
`
`SIGHTSOUND TECHNOLOGIES, LLC,
`
`Patent Owner.
`_______________
`
`Case CBM2013-00020
`Patent 5,191,573
`
`_______________
`
`PATENT OWNER’S SUR-REPLY
`
`
`
`

`

`
`
`TABLE OF CONTENTS
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`PAGE
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`TABLE OF AUTHORITIES ............................................................................................... ii
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`I.
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`Petitioner Applies The Wrong Legal Standards On Obviousness ........................ 3
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`II. Under The Correct Legal Standard, The Claims Are Not Obvious In
`View Of The CompuSonics References .................................................................. 6
`
`A.
`
`B.
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`Petitioner Has Failed To Show That The Use Of Non-Removable
`Media Was Obvious In The Context Of The Claims As A Whole .......... 7
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`Petitioner Misuses The Applicant’s Statements About “Electronic
`Sale[s]” As Supposed Admissions On Obviousness ................................. 13
`
`III. Petitioner’s Other Obviousness Arguments Are Legally And Factually
`Wrong ......................................................................................................................... 14
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`IV. Conclusion ................................................................................................................. 15
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`-i-
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`TABLE OF AUTHORITIES
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`CASES
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` PAGE(S)
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`ActiveVideo Networks, Inc. v. Verizon Commc’ns, Inc.,
`694 F.3d 1312 (Fed. Cir. 2012) ....................................................................................... 5
`
`Diversitech Corp. v. Century Steps, Inc.,
`850 F.2d 675 (Fed. Cir. 1988) ........................................................................................ 15
`
`Ecolochem, Inc. v. S. Cal. Edison Co.,
`227 F.3d 1361 (Fed. Cir. 2000) ..................................................................................... 14
`
`Henkel Corp. v. Coral Inc.,
`754 F. Supp. 1280 (N.D. Ill. 1990), aff’d, 945 F.2d 416 (Fed. Cir. 1991) ................. 14
`
`Innogenetics, N.V. v. Abbott Labs.,
`512 F.3d 1363 (Fed. Cir. 2008) ................................................................................... 4, 5
`
`KSR Int’l Co. v. Teleflex Inc.,
`550 U.S. 398 (2007) ....................................................................................................... 3-4
`
`Leo Pharm. Prods., Ltd. v. Rea,
`726 F.3d 1346 (Fed. Cir. 2013) ..................................................................................... 12
`
`Mendenhall v. Astec Indus. Inc.,
`13 U.S.P.Q.2d 1913 (E.D. Tenn. 1988), aff'd mem., 887 F.2d 1094, 13
`U.S.P.Q.2d 1956 (Fed. Cir. 1989) ................................................................................. 14
`
`Mintz v. Dietz & Watson, Inc.,
`679 F.3d 1372 (Fed. Cir. 2012) ..................................................................................... 12
`
`OTHER AUTHORITIES
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`37 C.F.R. § 42.304(b)(4) ......................................................................................................... 4
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`MPEP § 2141.02 ..................................................................................................................... 7
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`-ii-
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`

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`This paper follows the Board’s May 15, 2014 Order permitting Patent Owner
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`SightSound Technologies, LLC (“PO”) a sur-reply to respond to “arguments made by
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`Petitioner in its papers and at the hearing that the challenged claims would have been
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`obvious over the CompuSonics publications.” See Paper 100 at 2. While PO
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`appreciates the opportunity to respond to Petitioner Apple Inc.’s (“Petitioner”)
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`untimely obviousness arguments, the prejudice to PO stemming from Petitioner’s
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`shifting arguments and procedural violations cannot be ameliorated by this sur-reply.
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`Petitioner’s specific obviousness arguments are difficult to discern even at this
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`thirteenth hour. Based upon Petitioner’s (now debunked) assertion that disparate
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`CompuSonics references all related to a single “system,” the Board took up sua sponte
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`obviousness over a combination of CompuSonics references (Exs. 4106-4108, 4112-
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`4119, and 4140) (the “References”).1 See Paper 14 at 27. Petitioner’s subsequent
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`obviousness arguments, however, were not confined to this ground and remarkably,
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`1 Petitioner says Exhibits 4112 and 4117 are “printed publications” and “POSITAs
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`had sufficient time to view and copy the slides and/or retain the information.” Paper
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`52 at 6 n.2. Having cited no evidence of how long these slides were shown, Petitioner
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`fails to carry its burden to show they are prior art publications. Further, Exhibit 4112
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`discloses at most the linkage of two “audio system” devices, both identified as a
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`“source,” with no disclosure of a hard disk, a first party, a financially distinct second
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`party, searching, storing, or transferring money electronically. See Ex. 4112.
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`
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`-1-
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`

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`
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`its Reply focuses on entirely different arguments, ignoring the content of the specific
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`CompuSonics References.2 At trial, Petitioner likewise proposed no combination of
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`References that collectively teaches the claimed invention. Even at this late juncture,
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`PO cannot discern on a claim-by-claim basis which References Petitioner purports to
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`combine and in what manner. It cannot be overstated that these unclear, untimely
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`and shifting obviousness arguments only compound the prejudice to PO.
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`Even if certain CompuSonics References collectively disclosed all of the claim
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`limitations (they do not), Petitioner has never provided a reason why a person of
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`ordinary skill would combine disclosures for disparate systems (and “futurama”
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`speculation) to obtain the claimed invention. This failure is particularly egregious
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`given that the ‘573 claims issued and were confirmed after a rigorous 5 1/2-year
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`reexamination, during which time the PTO considered hundreds of references,
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`including eight of the twelve References asserted here. Petitioner fails to explain why
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`a third consideration of the claims should yield a different result or why the four
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`“new” references are different or more compelling than those PO previously
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`overcame. Accordingly, even putting aside Petitioner’s many procedural violations
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`2 Given the Board’s Order limiting the sur-reply to obviousness “over the
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`CompuSonics publications,” PO does not submit any additional declarations to
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`address the new references and arguments belatedly injected by Petitioner into the
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`proceedings (e.g., Exs. 4209-4210 and Bowen interview).
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`
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`-2-
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`and the ensuing impact on PO’s due process rights, the Board should find that
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`Petitioner has not carried its burden of showing that claims 1, 2, 4, and 5 are
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`unpatentable as obvious.
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`I.
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`Petitioner Applies The Wrong Legal Standards On Obviousness
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`Unable to account for the fact that there was no single CompuSonics System—
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`a “system” with telerecording capability that Petitioner claimed CompuSonics
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`“produced and sold” (Ex. 4132, ¶ 33) never existed3—Petitioner focused its Reply on
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`whether claims elements were otherwise known in the art and on untimely new
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`references. Paper 52 at 8-9. Even if such arguments were within the ground taken up
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`by the Board (they are not), Petitioner applies the wrong legal standard.
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`While the Court in KSR eschewed any rigid test for combining references, it
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`emphasized the need “to determine whether there was an apparent reason to combine
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`3 At trial, Petitioner’s counsel said a “careful reading” of its submission would reveal
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`that it did not mislead the Board about the capabilities of CompuSonics’ DSPs. Paper
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`101 (hereinafter, “Tr.”) at 21. Not so. Dr. Kelly’s Declaration states: “CompuSonics
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`produced and sold a line of digital recording and playback devices [that] were
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`capable of . . . receiving and storing a digital recording from another computer over a
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`communications interface.” Ex. 4132, ¶ 33 (emphasis added). This has been proven
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`false. See Ex. 2121, ¶ 20 (“[N]o DSP product sold or commercially available ever had
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`telerecording capability.”).
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`-3-
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`the known elements in the fashion claimed by the patent at issue.” KSR Int’l Co. v.
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`Teleflex Inc., 550 U.S. 398, 418 (2007). Post- KSR, the Federal Circuit teaches that
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`“there must be some articulated reasoning with some rational underpinning to
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`support the legal conclusion of obviousness.” Innogenetics, N.V. v. Abbott Labs., 512
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`F.3d 1363, 1373 (Fed. Cir. 2008). Indeed, KSR confirms that “this analysis should be
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`made explicit.” KSR, 550 U.S. at 418.
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`Here, Petitioner provides no reason why one of skill in the art would have
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`combined the elements in the CompuSonics References in the manner claimed.
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`Ignoring its burden, Petitioner says “PO fails to rebut [Petitioner’s] showing that it
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`would have been obvious to a POSITA to combine the CompuSonics articles” (Paper
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`52 at 1), neglecting to mention that Petitioner never made any such “showing.”4 In
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`fact, Petitioner does not discuss the content of the CompuSonics References at
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`all in the course of its Reply obviousness arguments. Paper 52 at 8-10. This
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`audacity continued at trial, where counsel stated paragraphs 47 and 48 of its expert’s
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`declaration (Ex. 4132) explain “in some detail” why the claimed invention would be
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`obvious. Tr. at 92. In fact, the obviousness discussion in these paragraphs contain
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`4 Because Petitioner never raised obviousness over CompuSonics, its new arguments
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`violate many procedural rules, including that the Petition identify “the specific part of
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`the claim” being challenged and state “how the identified subject matter fails to
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`comply” with the asserted statutory ground. 37 C.F.R. § 42.304(b)(4).
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`
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`-4-
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`
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`only rank conclusion of the kind routinely held to be deficient. See Ex. 4132, ¶ 47
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`(stating only that “the asserted claims would have been in the possession of or
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`obvious to one of ordinary skill in the art from the disclosures in one or more of
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`certain prior art references”); see also ActiveVideo Networks, Inc. v. Verizon Commc’ns, Inc.,
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`694 F.3d 1312, 1327-28 (Fed. Cir. 2012) (“[T]he expert’s testimony on obviousness
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`was essentially a conclusory statement that a person of ordinary skill in the art would
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`have known, based on the ‘modular’ nature of the claimed components, how to
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`combine any of a number of references to achieve the claimed inventions. This is not
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`sufficient and is fraught with hindsight bias.”); Innogenetics, 512 F.3d at 1373-74.
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`Petitioner’s reply expert declaration fares no better as it also fails to explain why it
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`would have been obvious to combine the CompuSonics References to obtain the
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`claimed invention. See Ex. 4262, ¶ 13 (arguing only that CompuSonics “does not
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`teach away from using non-removable media.”).
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`Unable to marshal evidence under the correct legal standard, Petitioner argues
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`instead that its position that “a POSITA would have combined the CompuSonics
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`references” was “consistent” with the testimony of PO’s expert, Mr. Snell. Paper 52
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`at 10. Not so. Mr. Snell was not testifying about the CompuSonics References, and
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`said only that he believed it would be reasonable to combine papers published by
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`LucasFilm researchers regarding how a LucasFilm “audio signal processor could be
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`used.” Ex. 4165 at 249:1-251:4. Even if published research papers from the same
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`company about the same device were analogous to the hodgepodge of references and
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`-5-
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`systems here, this does not demonstrate whether, how, and why a person of ordinary
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`skill would cherry-pick such elements from the various References and systems.
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`II. Under The Correct Legal Standard, The Claims Are Not Obvious In
`View Of The CompuSonics References
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`Petitioner asserted at trial that a statement in PO’s Response about “prior art
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`elements working according to their established functions and predictability” (Paper
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`41 at 64) proves obviousness under KSR. See Tr. at 16-17. PO strenuously disagrees.
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`While various claim elements may have been known and used in predictable ways, the
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`combination of the elements in the method taught by Mr. Hair was groundbreaking
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`and did not yield a predictable result. In fact, the combination was directly contrary
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`to the paradigm that existed in the market and represented a sea change from prior art
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`distribution systems, where consumers purchased music or videos in the form of
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`small physical units (e.g., records, tapes, CDs, etc.) and played them on a consumer
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`electronic product (as CompuSonics envisioned with its DSPs playing floppy disks).
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`These physical units did not offer the same control and flexibility of non-removable
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`memory storage such as hard drives, and did not permit one to select, download,
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`store, sort, and rearrange individual signals making up a digital audio recording.
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`Mr. Hair’s revolutionary method of providing for the purchase of digital audio
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`and video signals over telecommunications lines with the signals stored in non-
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`removable memory freed the buyer and seller entirely from dealing with physical
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`articles and provides the benefits detailed in the specification. See Paper 41 at 59-65.
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`-6-
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`

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`Even if the CompuSonics References related to a single system (they don’t) or if
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`Petitioner had provided a reason to combine them (it didn’t), significant differences
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`exist in the disclosures that teach away from utilizing a hard drive for a second
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`memory, and toward storing music on physical articles (CompuSonics advocated
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`floppy disks). These differences were not obvious, particularly when properly viewed
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`in the context of the invention as a whole. See MPEP § 2141.02 (“In determining the
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`differences between the prior art and the claims, the question under 35 U.S.C. 103 is
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`not whether the differences themselves would have been obvious, but whether the
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`claimed invention as a whole would have been obvious.”) (citations omitted).
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`A.
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`Petitioner Has Failed To Show That The Use Of Non-Removable
`Media Was Obvious In The Context Of The Claims As A Whole
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`The CompuSonics References disclose only the use of removable media as the
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`memory device through which the purchaser would receive and store digital signals.
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`In all material respects, floppy disks and write-once read-many optical disks are like
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`the storage units disparaged in the ‘573 specification and disclaimed in the file history,
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`and lacking the benefits of the claimed “second memory.” Paper 41 at 60-62.
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`Petitioner argued at trial that the presence of a hard disk on certain
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`CompuSonics devices disclosed the claimed “second memory.” See Tr. at 19, 82.5
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`5 Petitioner claimed that the CompuSonics DSP-1800 used a hard drive (Tr. at 19,
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`82), but this device appears nowhere in the References or Petitioner’s claim charts.
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`Footnote continued on next page
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`-7-
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`Yet, of the few CompuSonics devices with a hard disk, the References never taught
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`storage on those devices or a hard disk by the purchaser of digital audio and video
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`signals.6 Instead, they were used by the content holder, and the References
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`demonstrate that CompuSonics did not understand that it would be desirable for
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`Footnote continued from previous page
`Petitioner also said the term “disk,” when used in isolation, “generically” supported
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`the disclosure of any disk. Tr. at 81, 84 (“[4116] talks generically about disks, again,
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`which I think supports a disclosure of the use of any disk.”). This mischaracterizes
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`the References: while Exhibit 4116 uses the term “disk” alone, the publication as a
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`whole shows that the term does not mean a hard disk. See Ex. 4116 at 1 (“such as
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`recordable optical disks currently available”), 2 (“using inexpensive floppy disks”), 4
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`(“distribute the audio/video information on floppy disk”).
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`6 At trial, Petitioner grossly distorted the intrinsic record, claiming PO said any type
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`of memory device could be used as a “second memory,” showing it is not limited to
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`non-removable media. Tr. at 7, 97. PO actually said “[a]ny suitable memory device
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`controlled and in possession of the second party can be used to record the incoming
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`digital signals.” Ex. 4102 at 189 (emphasis added); see id. at 140-41 (“Any suitable
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`recording apparatus. . .”). PO emphasized that the memory must be “suitable”;
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`therefore, consistent with the invention’s teachings and intrinsic evidence, the
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`memory must be non-removable. See Paper 41 at 10-13, 25-29.
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`-8-
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`consumers of music to store their music on hard drives—or that consumers would be
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`willing to give up holding their music on physical portable articles such as records,
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`tapes, and CDs.7 See, e.g., Ex. 4115 at 1. As discussed below, hard drives were not an
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`obvious choice for consumer music storage, and market forces would have militated
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`against such a choice. Read as a whole, the CompuSonics References teach away
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`from using hard drives as a second memory.
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`At the hearing, Petitioner latched onto the argument that a hard disk would
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`have been an obvious “design choice” for a second memory. Tr. at 82, 97. Not a
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`single piece of evidence in the record supports this assertion. None of Petitioner’s
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`experts said so; in fact, they disparaged hard drives as a memory choice during the
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`relevant time period. See Ex. 4256, ¶¶ 57 (“[H]ard disks were a prime example of the
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`high cost of storage at the time.”), 63 (“I understand from Dr. Kelly that most hard
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`drives at the time did not even have 150 megabytes of storage.”)8; Ex. 4262, ¶ 6 (“[I]n
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`7 CompuSonics intended for floppy disks to become the next standard, replacing the
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`CD, with the DSP becoming the next-generation player. See, e.g., Ex. 4119 at 1-2
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`(“CompuSonics wants to win audiophiles before the Japanese decide to go with digital
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`tape. To make its floppy disks the standard, the company plans to license the
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`technology cheaply to other manufacturers.”).
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`8 Petitioner’s expert noted that few homes had home computers in 1988, which had
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`“relatively small storage capacity available,” meaning “even fewer potential sales, even
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`Footnote continued on next page
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`-9-
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`1988 removable media storage devices could have larger capacity than non-removable
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`media storage devices.”); Ex. 2175 at 59:7-61:8 (“So around 1988, the hard drives
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`were very delicate. . . . so physical damage to a hard drive occurred regularly.”).
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`While Petitioner asserts that improved memory (i.e., hard drives) would have
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`been utilized once the capacity/price ratio improved (which Mr. Kenswil said only
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`took place after 2000 (see Ex. 4256, ¶ 63)), this does not make such a storage medium
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`an obvious design choice in 1988. See Paper 52 at 3. In fact, Dr. Kelly’s testimony
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`that “the removable/non-removable distinction is a false dichotomy in assessing
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`whether a system will derive the benefits described in the ‘573 patent” (Ex. 4262, ¶ 9)
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`reflects Petitioner’s fundamental misunderstanding of the role of the non-removable
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`storage/hard disk as the second memory in carrying out the purpose of the invention.
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`Non-removable memories such as a hard disks were distinct from floppies, records,
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`tapes, and CDs in that they permitted the user to have digital signals in one repository
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`that eliminated unnecessary handling of hardware units, permitting users to create and
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`change playlists, etc. See ‘573 Patent at 2:31-35 (“The high speed transfer of Digital
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`
`Footnote continued from previous page
`within the subset of available consumers” (Ex. 4256, ¶ 57), yet another reason that a
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`hard disk was not obvious at the time of the invention. As the Board has determined
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`that the invention is a business method, it would be illogical to choose a second
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`memory that, as Petitioner asserts, “limited the potential customer base.” Id.
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`-10-
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`

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`Audio Music as prescribed by this invention is stored onto one piece of hardware, a
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`hard disk. . . .”), 2:35-50. The suggestion that a hard disk and floppy disk were
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`equivalent, and that one would have just been swapped for the other, is incorrect in
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`the context of music distribution and contrary to the evidence in the record.
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`PO’s expert opined that using a hard disk as non-removable storage was not a
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`mere design choice, but Petitioner wrongly says he failed to consider CompuSonics’
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`use of hard disks in some DSPs. See Paper 52 at 3. In fact, PO’s expert identified in
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`his declaration the very sentence that Petitioner claims he did not consider, noting:
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`“CompuSonics, notwithstanding being knowledgeable about hard drives, taught away
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`from consumer storage on non-removable media such as hard drives.” Ex. 2153, ¶
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`72. CompuSonics believed hard drives were inferior (noisy and impractical for
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`consumer equipment), and thus used floppy or optical drives in its DSP-1000s. Id. at
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`¶ 74; Ex. 2121, ¶ 7. While Mr. Hair “understood that music and video sales were
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`being hampered by their removable media” (Ex. 2153, ¶ 66), “those of skill in the art
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`did not recognize the inefficiencies or the solution for the problem.” Id. at ¶ 72.9
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`9 CompuSonics, like others, predicted that sometime in the future, digital signals
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`could be sent directly to a consumer, but never reached the revolutionary insight of
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`freeing the signals from a physical article and storing them on the user’s hard disk.
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`Without this inventive leap, CompuSonics’ so-called telerecording resembles the
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`Freeny system (considered extensively during reexamination), as explained in detail by
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`Footnote continued on next page
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`-11-
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`Market forces in the recording industry in 1988 would also have driven a skilled
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`artisan further away from using non-removable media to store audio or video signals.
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`Discussions regarding storage media centered on what the next generation physical
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`device would be, i.e., what would ultimately replace the CD. See, e.g., Ex. 4119. In
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`short, no one was looking to “solve” the problem of physical media because it was
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`not a recognized problem. Ex. 2153, ¶ 72; see Leo Pharm. Prods., Ltd. v. Rea, 726 F.3d
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`1346, 1356-57 (Fed. Cir. 2013) (“As an initial matter, an invention can often be the
`
`recognition of a problem itself.”); Mintz v. Dietz & Watson, Inc., 679 F.3d 1372, 1377-
`
`78 (Fed. Cir. 2012) (“Often the inventive contribution lies in defining the problem in
`
`a new revelatory way. In other words, when someone is presented with the identical
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`problem and told to make the patented invention, it often becomes virtually certain
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`that the artisan will succeed in making the invention.”). Quite the opposite, the
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`evidence reflects the long-held belief at that time that the only model for selling and
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`distributing music was the sale of physical articles on which music was stored and
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`then “played” on a turntable, tape deck, CD player, etc.
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`Similarly, in 1988, stakeholders in the music and recording industry were not
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`willing to sell digital music directly to consumers in a manipulable form to be stored
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`
`Footnote continued from previous page
`Mr. Snell. Ex. 2153 ¶ 63. Without evidence that this breakthrough was envisioned
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`prior to 1988, any assertion that it is obvious can only be attributed to hindsight.
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`-12-
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`

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`on the hard drives of consumers’ home computers, which presented far too great a
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`risk of unauthorized copying or mass replication and piracy. See Ex. 2153, ¶ 62; Ex.
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`4256, ¶ 56 (“[E]ncryption and copyright protection were a significant concern for the
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`record labels.”). The recording industry was far more comfortable with consumers
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`owning music in a fixed form fused to a physical unit which presented fewer,
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`reasonably well-understood risks in this regard. See Ex. 2153, ¶ 63. Thus, from a
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`market perspective, it was neither desirable nor obvious to move from music sold to
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`consumers in the form of physical units to music stored on non-removable hardware.
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`B.
`
`Petitioner Misuses The Applicant’s Statements About “Electronic
`Sale[s]” As Supposed Admissions On Obviousness
`
`Petitioner improperly recasts Applicant’s statements during prosecution
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`regarding “electronic sales” in claiming CompuSonics disclosed “transferring money
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`electronically” with statements like “all-electronic purchases.” Paper 52 at 4; Tr. at
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`27-28. The Board rejected the same argument in declining to take up the single
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`obviousness ground stated in the Petition—i.e., that the claims were obvious in view
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`of Synth-Bank. As the Board noted, while “Petitioner relies on statements from the
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`applicant during prosecution of the ‘573 patent as to what ‘electronic sale[s]’ involve
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`‘inherently,’ . . . [t]he applicant . . . appears to have been speaking to what the original
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`specification of the ‘573 patent discloses inherently.” Paper 14 at 30. The Board did
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`“not see this as indicative of what . . . a different system, discloses inherently.” Id.
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`
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`-13-
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`III. Petitioner’s Other Obviousness Arguments Are Legally And Factually
`Wrong
`
`Petitioner’s response to objective indicia of non-obviousness—which provide
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`an important check against the use of hindsight—should be rejected. Petitioner
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`sought to attribute the commercial success of iTMS to features in addition to the
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`patented method. See Paper 52 at 10-14. Putting aside its lack of factual support,
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`Petitioner’s premise—that PO must show that the patented method was the sole
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`reason for iTMS’s success—is wrong. Ecolochem, Inc. v. S. Cal. Edison Co., 227 F.3d
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`1361, 1378 (Fed. Cir. 2000). Courts have found commercial success to support non-
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`obviousness even where that success was also due to external factors, such as the
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`availability or lack of raw materials. Henkel Corp. v. Coral Inc., 754 F. Supp. 1280, 1319
`
`(N.D. Ill. 1990), aff’d, 945 F.2d 416 (Fed. Cir. 1991) (unpublished) (“Evidence that the
`
`success of the claimed invention may have been due in part to increased energy costs
`
`does not preclude finding of commercial success.”); Mendenhall v. Astec Indus. Inc., 13
`
`U.S.P.Q.2d 1913, 1942 (E.D. Tenn. 1988), aff'd mem., 887 F.2d 1094, 13 U.S.P.Q.2d
`
`1956 (Fed. Cir. 1989) (commercial success supported non-obviousness even when the
`
`success of the patented invention relating to asphalt recycling was also due to
`
`increased oil prices and the limited supply of raw materials). Even if success were due
`
`to both Petitioner’s use of PO’s invention and the availability of desirable content
`
`(unavailable when PO implemented its invention in the 1990s, due to distinct market
`
`dynamics (see Ex. 2110, ¶¶ 5, 12)), this does not rebut non-obviousness.
`
`
`
`-14-
`
`

`

`
`
`Petitioner’s own expert confirmed the importance and nexus of the patented
`
`method to a fundamental shift in the market beginning in the late 1990s. The “main
`
`reasons” identified by Mr. Kenswil that music downloads replaced physical media
`
`sales are the benefits described in the specification, including storing audio or video
`
`signals in a non-removable “second memory.” Compare Ex. 2174 at 124:14-125:20,
`
`143:1-17, with ‘573 Patent at 2:31-50, 4:52-55. While Petitioner argued at trial that
`
`these specific benefits are not recited in the claims and thus do not establish a nexus
`
`(see Tr. at 78-79), its position is contrary to its own expert’s admissions as well as the
`
`case law. See, e.g., Diversitech Corp. v. Century Steps, Inc., 850 F.2d 675, 679 (Fed. Cir.
`
`1988) (reversing district court finding of obviousness and lack of nexus to commercial
`
`success where the patented invention’s “commercial success was due, at least in part,
`
`to one of the four advantages set forth in the patent specification”).
`
`IV. Conclusion
`
`For all of these reasons, Petitioner has failed to carry its burden on the issue of
`
`obviousness.
`
`
`
`
`
`
`
`-15-
`
`

`

`
`
`Dated: June 6, 2014
`
`Respectfully submitted,
`
`
`
`
`
`
`
`
`
` By: /David R. Marsh/
`David R. Marsh, Ph.D.
`Jennifer A. Sklenar
`Kristan L. Lansbery, Ph.D.
`ARNOLD & PORTER LLP
`555 12th Street, N.W.
`Washington, DC 20004
`Tel: (202) 942-5068
`Fax: (202) 942-5999
`
`Attorneys for Patent Owner
`SightSound Technologies, LLC
`
`-16-
`
`

`

`
`
`CERTIFICATE OF SERVICE
`
`The undersigned certifies that a copy of the foregoing Patent Owner’s Sur-
`
`Reply was served on June 6, 2014 to the following Counsel for Petitioner via e-mail,
`
`pursuant to the parties’ agreement concerning service:
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`J. Steven Baughman, Lead Counsel
`Ching-Lee Fukuda
`ROPES & GRAY LLP
`Prudential Tower
`800 Boylston Street
`Boston, Massachusetts 02199-3600
`Steven.Baughman@ropesgray.com
`Ching-Lee.Fukuda@ropesgray.com
`ApplePTABServiceSightSound@ropesgray.com
`
`Attorneys for Petitioner Apple Inc.
`
`/David R. Marsh/
`David R. Marsh (Atty. Reg. No. 41,408)
`ARNOLD & PORTER LLP
`555 12th Street, N.W.
`Washington, D.C. 20004
`Tel: (202) 942-5068
`Fax: (202) 942-5999
`
`-17-
`
`

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