`
`
`
`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
`______________
`
`Before the Honorable MICHAEL P. TIERNEY, JUSTIN T. ARBES, and
`GEORGIANNA W. BRADEN,
`Administrative Patent Judges.
`
`
`
`PETITIONER’S OPPOSITION TO PATENT OWNER
`SIGHTSOUND TECHNOLOGIES LLC’S MOTION FOR ADDITIONAL
`DISCOVERY UNDER 37 CFR § 42.224(a)
`
`
`
`
`
`
`
`
`
`Case CBM2013-00020
`Patent No. 5,191,573
`SightSound’s motion disregards the Board’s clear guidance in permitting brief-
`
`ing of its additional discovery requests. Paper 24 at 2-3. The Board cautioned, first,
`
`that SightSound’s requests “will not be granted if they are unduly broad and encom-
`
`pass numerous documents that are irrelevant to the instituted grounds of patentabil-
`
`ity,” and, second, that “the mere possibility of finding something useful, and the mere
`
`allegation that something useful will be found, are insufficient” and SightSound
`
`“should already be in possession of some evidence (e.g., as to an alleged nexus) to
`
`show beyond mere speculation that something useful will be uncovered.” Id. Flout-
`
`ing both requirements, SightSound’s motion falls far short of showing “good cause.”
`
`SightSound imagines a secondary considerations story based on commercial
`
`success of, and supposed “copying” of “the patented invention” by, Apple’s iTunes
`
`Music Store (“iTMS”) (Paper 29, “Mem.” 1), but SightSound’s own papers make clear it
`
`has no evidence at all—let alone the required threshold—suggesting the copying, nexus,
`
`or commercial success SightSound recognizes is required for secondary indicia of
`
`non-obviousness. E.g., Mem. 9. Indeed, SightSound’s “copying” theory is contradict-
`
`ed by the law, as it falsely equates “copying” with “infringing.” See, e.g., IPR2013-
`
`00191, Paper 27 at 7 (“‘Not every competing product that arguably falls within the
`
`scope of a patent is evidence of copying, because otherwise every infringement suit
`
`would automatically confirm the nonobviousness of the patent.’”) (citation omitted).
`
`SightSound’s sweeping demands for “technical documentation” rests solely on
`
`bald speculation that they would prove infringement (not copying or commercial suc-
`1
`
`
`
`
`
`Case CBM2013-00020
`Patent No. 5,191,573
`cess)—an issue hotly contested in co-pending litigation, and in any event insufficient
`
`to show secondary considerations. SightSound simply asserts such documents would
`
`“presumably show” infringement (Mem. 2 (all emphases added unless noted)), without
`
`ever explaining why. Further, SightSound offers no threshold evidence of any nexus
`
`between supposedly infringed features and any consumer demand for iTMS. Nor
`
`could it: SightSound tells the Board consumers do not know whether iTMS has the features
`
`SightSound argues are driving consumer demand (Mem. 6; Ex. 2106 at 13:5-16:4), and so they
`
`certainly could not be demanding iTMS on that basis.
`
`SightSound’s burdensome, unfocused “survey” request fares no better. Sight-
`
`Sound’s pretext here is to establish consumers preferred “digital signals . . . over phys-
`
`ical media such as tapes and CD’s” (Mem. 9)—an alleged preference not linked to any
`
`supposed point of novelty in SightSound’s patent claims, but instead (and indisputably) found
`
`throughout the prior art. SightSound—ignoring the very declaration it cites—also vastly
`
`understates the volume of documents encompassed by its loose demand for “sur-
`
`veys,” which appears to call for an avalanche of far-flung Apple documents.
`
`Finally, even if the many other fatal holes in SightSound’s story were ignored,
`
`its argument that iTMS’s commercial success sprang from some novel aspect of its
`
`patent claims is facially implausible: while SightSound argues a nexus should be pre-
`
`sumed based on the circular contention that iTMS is coextensive with the patent, the
`
`testimony of SightSound’s “inventor” reveals, and the PTO recognized during reex-
`
`amination, that SightSound’s own commercial product practicing the “invention”
`
`
`
`
`-2-
`
`
`
`Case CBM2013-00020
`Patent No. 5,191,573
`(now long since destroyed) was a complete commercial failure (see Ex. 4104 at 80:15-29,
`
`100:22-102:13, 160:9-163:2; Ex. 4103 at 266-67); the success of iTMS some 10 years
`
`later was driven by technology and features having nothing to do with the patent.
`
`SightSound, in violation of the clear requirements for additional discovery,
`
`seeks a license to go fishing for an infringement story its own admissions prove could
`
`not be “useful” in any secondary considerations argument. Its suggestion that, to
`
`challenge validity, any PTAB petitioner must subject itself to a trial within a trial on in-
`
`fringement is nonsense: it would levy huge unjustified burdens, impose impractical delay
`
`in light of the statutory timeline, and destroy the basic underpinnings of these new
`
`proceedings, which were created to provide an “efficient, streamlined, and cost-
`
`effective alternative to district court litigation.” E.g., CBM2013-00005, Paper 32 at 3.
`
`I. The Technical Documentation (Requests 1-3) Demanded by SightSound
`Will Not and Could Not Show Commercial Success or Copying
`A. Rather than Threshold Evidence, SightSound Offers Mere Speculation
`SightSound’s motion fails to establish, as required for good cause, that it is “in
`
`possession of a threshold amount of evidence or reasoning tending to show beyond
`
`speculation that something useful will be uncovered.” IPR2012-00001, Paper 26 at 7.
`
`See also CBM2013-00005, Paper 32 at 5. Indeed, SightSound offers no evidence at all of
`
`either copying or the required nexus for commercial success. To the contrary, its mo-
`
`tion confirms SightSound is only speculating about what discovery might reveal, stat-
`
`ing, e.g., that the requested materials “would presumably show that the iTMS practices
`
`
`
`
`-3-
`
`
`
`Case CBM2013-00020
`Patent No. 5,191,573
`the patent and is co-extensive with the patented invention” (Mem. 2), but offering no
`
`evidence that either the Tygar litigation report (discussing highly confidential material
`
`including source code) or any other requested documents would actually demonstrate
`
`that Apple infringes. Indeed, Apple hotly contests infringement, and served an expert
`
`report in litigation rebutting Tygar’s theories. Ex. 4148. SightSound apparently con-
`
`templates forcing Apple to repeat here the battle of experts, culminating years of liti-
`
`gation, that is already teed up in the district court, but with no threshold showing to
`
`the Board and, instead, a theory that is itself contradicted by the law.
`
`Even if (a) SightSound received the discovery it seeks, (b) Apple introduced a
`
`raft of evidence contradicting SightSound’s infringement allegations as in the litiga-
`
`tion, and (c) the Board conducted its own infringement trial, any infringement finding
`
`(which Apple submits would never be supported to begin with) would not be “useful”
`
`because SightSound cannot prove copying or a nexus to commercial success. SightSound’s own
`
`commercial systems using its “invention” to sell digital media over the Internet were a
`
`complete failure (Ex. 4104 at 82:2-83:6; 160:9-20), and this failure—with systems that,
`
`inter alia, lacked content from major record labels and could take more than a day to
`
`download one song based on then-available transmission systems (id. at 86:11-18)—would
`
`rebut any “presumed” nexus. Brown & Williamson Tobacco Corp. v. Philip Morris Inc., 229
`
`F.3d 1120, 1130 (Fed. Cir. 2000) (presumptive nexus rebutted where competitor’s
`
`product with all claimed features was commercial failure). Indeed, many other entities
`
`trying to sell digital music over the Internet also failed (Exs. 4149-4151), while Ap-
`
`
`
`
`-4-
`
`
`
`Case CBM2013-00020
`Patent No. 5,191,573
`ple—which ten years later similarly offered digital music over the Internet, but with-
`
`out such shortcomings in unclaimed aspects of SightSound’s offering—succeeded. In-
`
`deed, the Examiner in Reexamination No. 90/007,402 rejected SightSound’s prior at-
`
`tempts to establish commercial success for this very reason, pointing out SightSound’s
`
`commercial failure (Ex. 4103 at 266), and concluding that “Applicant cannot attribute
`
`the commercial success of Apple’s ITunes system to the alleged use of their claimed
`
`invention when Apple was already a market leader before the system was launched”
`
`(id. at 267), and that “[t]he existence and profitability of [iTMS is] due to the advances
`
`in recent technology and not Applicants’ claimed invention.” Id.
`
`This record evidence of SightSound’s own failure and the obvious importance
`
`of other features to iTMS’s success (see Petition, Paper 1, at 24) contrasts starkly with
`
`SightSound’s utter failure to offer the Board any threshold evidence suggesting a nex-
`
`us between iTMS and any patentable aspect of its claims. SightSound imagines iTMS
`
`is “co-extensive” with the patented invention and suggests a presumed nexus (Mem.
`
`6) only by ignoring numerous well-known features of iTMS clearly unrelated to the
`
`patent, such as a user-friendly interface and the ability to easily download music onto
`
`an iPod. Ex. 4152-4153. See IPR 2012-00001, Paper 26 at 8 (party seeking discovery
`
`had not accounted for presence of other desirable features). Further, the very fact
`
`SightSound says it needs discovery of the features it claims drove consumer demand for
`
`iTMS because they are not known to the public (Mem. 6; Ex. 2106 at 14:8-16:4) reveals an-
`
`other fatal flaw in SightSound’s arguments, and confirms its requests for additional
`
`
`
`
`-5-
`
`
`
`Case CBM2013-00020
`Patent No. 5,191,573
`discovery could never be “useful”: if Apple “does not publicly detail” the features
`
`SightSound argues led to commercial success, they cannot be driving consumer demand for
`
`iTMS.
`
`Moreover, SightSound’s copying allegation is based on the false legal premise
`
`that copying can be proven simply by showing an accused infringer practices a claim.
`
`Mem. 2. But copying in the context of commercial success requires “[e]vidence of
`
`efforts to replicate a specific product, which may be demonstrated through internal com-
`
`pany documents, direct evidence such as disassembling a patented prototype, photo-
`
`graphing its features, and using the photograph as a blueprint to build a replica, or ac-
`
`cess to the patented product combined with substantial similarity to the patented
`
`products.” Wyers v. Master Lock Co., 616 F.3d 1231, 1246 (Fed. Cir. 2010) (internal
`
`quotations, citations omitted); IPR 2013-00191, Paper 27 at 7-8. There is no evidence
`
`tending to show Apple “copied” SightSound’s product, which was a commercial fail-
`
`ure. And SightSound would be unable to prove copying as a factual matter because
`
`SightSound long ago destroyed the evidence of its own commercial embodiment (Ex. 4104 at
`
`80:15-29, 92:21-93:21, 100:22-102:13, 161:15-163:2), and accordingly is not arguing
`
`even in litigation that Apple copied any SightSound product (Ex. 4154).
`
`B. SightSound Seeks Litigation Positions and their Underlying Basis
`SightSound’s requests relate directly to a key litigation dispute: whether iTMS
`
`infringes the asserted patent. Were SightSound allowed to present infringement ar-
`
`guments to the Board, Apple would be forced to respond with its non-infringement
`
`
`
`
`-6-
`
`
`
`Case CBM2013-00020
`Patent No. 5,191,573
`positions from the litigation and their underlying bases, effectively importing that liti-
`
`gation into this proceeding. See CBM2013-00005, Paper 32, at 5 (factor 2).
`
`C. Requests 2 And 3 Are Not Easily Understandable
`SightSound’s requests 2 and 3 give no indication of what detail SightSound
`
`would consider “sufficient to show” such sweeping propositions as “how Apple ac-
`
`cessed digital audio or video signals from memory and transferred them” and “how
`
`customers purchased digital audio or video signals and store such signals,” let alone
`
`how these requests might arguably relate to any novel claimed features. Mem. 4.
`
`D. Requests 1-3 Are Burdensome And Seek A “Trial Within A Trial”
`SightSound’s broad technical requests, with no attempt to tailor them to any
`
`argued points of novelty (Compare Ex. 2306 at 15-18 with Mem. 1), would lead to a
`
`trial within a trial on infringement, which would be burdensome and impractical given
`
`the one-year deadline for this trial, and would sweep in a huge volume of additional
`
`documents and related discovery. Production of the Tygar report, for example, would
`
`sweep in voluminous underlying material, require negotiation and implementation of
`
`complex protections for Apple’s extremely confidential key technologies such as
`
`source code (whose production should never be the price of admission to PTAB inva-
`
`lidity proceedings), and necessitate a correspondingly expansive response by Apple to
`
`rebut SightSound’s infringement claims. Similarly, production of detailed information
`
`“sufficient to show” SightSound’s amorphous propositions would require extensive
`
`and burdensome analysis, searching, and, undoubtedly, negotiation, as would the pro-
`
`
`
`
`-7-
`
`
`
`Case CBM2013-00020
`Patent No. 5,191,573
`tections required for Apple’s underlying technologies. In addition to the impact on
`
`these parties, granting such discovery requests would threaten the integrity of CBM as
`
`a cost-effective alternative to litigation, and would require any company contemplat-
`
`ing a CBM to feel exposed to the most invasive and burdensome discovery—
`
`disclosure of its highly successful source code information—on the thinnest of pre-
`
`texts. See also 77 Fed. Reg. 48612 (Aug. 14, 2012) (“The purpose of the AIA and this
`
`final rule is to establish a more efficient and streamlined patent system that will im-
`
`prove patent quality and limit unnecessary and counterproductive litigation costs”).
`
`II. SightSound’s Request for “Surveys” (Request 4) Is Equally Baseless
`
`Mere speculation. SightSound’s motion confirms its “survey” request similar-
`
`ly lacks any threshold showing, offering only raw speculation that something might be
`
`found. Mem. 3, 9-10 (SightSound “believes Apple tracks” and that “surveys . . . will
`
`likely reveal consumers’ preferences”). This is precisely the type of showing that is in-
`
`sufficient to justify additional discovery. E.g., IPR2012-00001, Paper 26 at 7 (test is not
`
`whether “‘Likely’ to Yield Relevant, Admissible Evidence”); IPR2013-00191, Paper 27
`
`at 4. SightSound needs to prove an alleged point of novelty is responsible for any
`
`commercial success of a product practicing its “invention.” See Ormco Corp. v. Align
`
`Tech., Inc., 463 F.3d 1299, 1312 (Fed. Cir. 2006) (no nexus where evidence did not
`
`show accused product’s commercial success was due to patent’s “claimed and novel
`
`features”). But its “survey” request is not targeted to any alleged point of novelty, nor
`
`does its motion even identify what that supposed novelty is believed to be. While
`
`
`
`
`-8-
`
`
`
`Case CBM2013-00020
`Patent No. 5,191,573
`SightSound stated in the November 8 call that the claimed feature at issue is the timing
`
`of payment, its request is directed, instead, to consumers’ preference for digital signals
`
`over physical media. Ex. 2106 at 13:5-19; 15:18-21. Whether the issue is digital sig-
`
`nals or payment timing, such features are not novel but, rather, prevalent in the art.
`
`Ex. 4114 at 10, 4115 at 1, 4117, 4119 at 2. And even if this request were tailored to
`
`focus on allegedly novel features, SightSound could not prove a nexus to commercial
`
`success, see supra, so its request could not be “useful.” Indeed, Apple’s studies are not
`
`designed to show whether any particular feature drives iTMS demand, and could not
`
`establish the missing nexus. Ex. 4155 (Declaration of Arthur Rangel) ¶ 10.
`
`Ability to generate equivalent information. While SightSound argues it
`
`could not “replicate” Apple’s surveys (Mem. 10), it offers the Board no reason why
`
`this is so or, for that matter, why “replicat[ion]” is necessary, as Apple’s surveys fo-
`
`cused on topics not at issue here. Mem. 10. Nor does SightSound offer any evidence
`
`it tried to survey consumers for their preferences in buying digital media, whether
`
`from iTMS or otherwise, or that it reviewed the data from its own efforts to commer-
`
`cialize its “invention.” Again, SightSound fails to make the showing of good cause
`
`required for additional discovery. See CBM2013-00005, Paper 32, at 5 (factor 3).
`
`Request that is not easily understandable. First, SightSound does not de-
`
`fine “survey,” which may include both formal studies and underlying data, together
`
`with informal feedback Apple regularly receives through buyer, owner, and market
`
`studies, and qualitative research. Ex. 4155 ¶ 3. Second, while SightSound says its re-
`
`
`
`
`-9-
`
`
`
`Case CBM2013-00020
`Patent No. 5,191,573
`quest relates to only about 12 documents, this is facially wrong, and its discussion fur-
`
`ther confuses what it seeks: the subset of documents it identifies are actually quarterly
`
`reports relating to monthly studies of iPads, which were not released until 2010 and
`
`thus outside the scope of its 2003-2007 request. Mem. 10, Ex. 2109 ¶ 4. Third, it is
`
`unclear whether SightSound intended to limit its request to quarterly reports of regular-
`
`ly-conducted studies, or whether the request also includes ad hoc studies, raw data,
`
`summaries of data, and other related information. See Ex. 4155 ¶ 6.
`
`
`
`Burdensome demand for useless information. Far from “ implicat[ing] no
`
`more than a dozen or so” surveys “conduct[ed]… quarterly” (Mem. 10), SightSound’s
`
`Exhibit 2109 indicates Apple conducts certain studies monthly and creates quarterly re-
`
`ports. Id. ¶ 4. Four to five years’-worth of regularly-conducted monthly studies and
`
`quarterly reports for one product alone amounts to over 48 surveys and 16 reports. Such
`
`reports are frequently over a hundred pages long, and the related data and other in-
`
`formation collected with each study may amount to thousands of pages. Ex. 4155 ¶ 4. Fur-
`
`ther, given SightSound’s reference to iPad reports, its requests appear to include not
`
`just iTMS-specific studies, but also studies directed to Apple hardware using iTMS.
`
`Construed broadly as SightSound appears to intend, this could require Apple to locate
`
`and gather tens of thousands of pages of materials. See id. ¶ 9. There can be no doubt that
`
`collecting, reviewing, and producing such a large volume of material would be highly
`
`burdensome – and, for the reasons detailed above, useless.
`
`SightSound’s motion for additional discovery should be denied.
`
`
`
`
`-10-
`
`
`
`
`
`Dated: November 22, 2013
`
`Case CBM2013-00020
`Patent No. 5,191,573
`Respectfully submitted,
`
`By: /J. Steven Baughman/
`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
`
`Attorneys for Petitioner Apple Inc.
`
`
`
`
`-11-
`
`
`
`Case CBM2013-00020
`Patent No. 5,191,573
`
`CERTIFICATE OF SERVICE
`
`The undersigned certifies that a copy of the foregoing PETITIONER’S OP-
`
`POSITION TO PATENT OWNER SIGHTSOUND TECHNOLOGIES LLC’S
`
`MOTION FOR ADDITIONAL DISCOVERY UNDER 37 CFR § 42.224(a) was
`
`served on November 22, 2013, to the following Counsel for Patent Owner via e-mail,
`
`pursuant to the parties’ agreement concerning service:
`
`David R. Marsh, Lead Counsel
`Kristan L. Lansbery
`Arnold & Porter LLP
`555 12th St., NW
`Washington, DC 20004
`david.marsh@aporter.com
`kristan.lansbery@aporter.com
`
`Attorneys for Patent Owner
`SightSound Technologies, LLC
`
`
`
` /s/ Megan F. Raymond
`Megan F. Raymond
`
`ROPES & GRAY LLP
`
`
`
`
`
`
`
`
`
`
`-12-
`
`
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
