`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`_____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`_____________
`
`IBG LLC; INTERACTIVE BROKERS LLC; TRADESTATION GROUP INC.;
`TRADESTATION SECURITIES, INC.; TRADESTATION TECHNOLOGIES,
`INC.; and IBFX, INC.
`Petitioners
`
`v.
`
`TRADING TECHNOLOGIES INTERNATIONAL, INC.
`Patent Owner
`_________
`
`CBM2015–00179
`Patent 7,533,056
`___________________
`
`
`PETITIONERS’ REPLY TO PATENT OWNER’S OPPOSITION
`TO PETITIONERS’ MOTION TO EXCLUDE
`
`
`
`
`
`
`Mail Stop “PATENT BOARD”
`Patent Trial and Appeal Board
`U.S. Patent and Trademark Office
`P.O. Box 1450
`Alexandria, VA 22313–1450
`
`
`
`
`
`
`Case CBM2015-00179
`Patent 7,533,056
`The Board should exclude TT’s inadmissible evidence identified in
`
`Petitioners’ Motion to Exclude (Paper 116, “Mot.”). TT’s opposition (Paper 117,
`
`“Opp.”) does nothing to cure its evidentiary shortcomings.
`
`I. Exhibit 2327.
`TT knows its testimonial evidence is inadmissible. (See Ex. 2107 at 14:18-
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`19:22; 24:14-25; 27:16-25 (asking Board to waive the FRE 802 and 901, and for
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`additional discovery “to get [ ] authentication” and “vitiate any hearsay
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`concerns”).) Its opposition asserts admissibility under FRE 807 and attempts to
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`horse trade on evidentiary issues. Both arguments fail.
`
`A. The Biddulph Transcript (Exhibit 2327).
`The Biddulph Transcript—which is undisputed hearsay—is inadmissible
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`under FRE 807.1 TT asserts that the “residual exception” applies to this evidence
`
`because it has “the same circumstantial guarantees of trustworthiness” as the
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`testimony at issue in Apple v. VirnetX and as the declarations created for these
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`proceedings. (Opp. at 4-8 (citing IPR2015-00811, Paper 44).) Not true. This
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`interpretation of Rule 807 eviscerates the rule against hearsay, which provides only
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`limited exceptions for testimony in prior proceedings. See FRE 804(b)(1).
`
`FRE 807 does not confer “a broad license” on judges “to admit hearsay
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`statements that do not fall within one of the other exceptions.” Neste Oil OYJ v.
`
`
`1 TT does not assert admissibility under Rules 803 or 804.
`
`
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`Case CBM2015-00179
`Patent 7,533,056
`REG Synthetic Fuels, LLC, IPR2013-00578, Paper 53, at 10 (P.T.A.B. Mar. 12,
`
`2015) (citation omitted). It only applies in “exceptional cases.” Id. This case is not
`
`exceptional, and TT has not shown otherwise. Thus, FRE 807 does not cure TT’s
`
`hearsay evidence. Nor does TT cite precedential authority holding that testimony
`
`from a prior proceeding is always admissible before the Board. Indeed, it cannot.
`
`See, e.g., Captioncall, L.L.C. v. Ultratec, Inc., IPR2015-00637, Paper 98, at 16-17
`
`(P.T.A.B. Sept. 7, 2016). TT’s reliance on Apple here is misplaced. First, both the
`
`patent owner and petitioner in Apple were also parties to the underlying district
`
`court litigation. See Apple, Paper 44, at 68-70. Second, the Board in Apple
`
`determined that the residual exception applied where the proponent analyzed each
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`factor of FRE 807 “in detail.” See id. 69. Here, TT provides no actual analysis
`
`under FRE 807(a)(1). Third, the Board in Apple merely adopted the petitioner’s
`
`analysis without explaining why that case was “exceptional.” See id. at 68-70.
`
`And TT’s hearsay evidence is not “more probative than any other evidence
`
`that TT could obtain through reasonable efforts.” (Opp. at 7.) TT has not shown
`
`that Mr. Biddulph is unavailable; it could have obtained a declaration. Indeed, TT
`
`represented that it had contact with at least some of its declarants. (Ex. 2107 at
`
`25:17-26:20.) Instead, TT attempts to shift the burden to Petitioners to seek to
`
`compel their depositions. This is misguided. Petitioners’ have no obligation to
`
`“cure” TT’s hearsay evidence. And TT never offered their depositions in an effort
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`Case CBM2015-00179
`Patent 7,533,056
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`to cure Petitioners’ evidentiary objections.
`
`Finally, TT’s assertion that it will be “deprived of due process” if the Board
`
`excludes its evidence is meritless and does not satisfy FRE 807(a)(4). See
`
`Captioncall, Paper 98, at 17. Holding TT to the same set of evidentiary rules as
`
`every other party before the Board is not a denial of due process.
`
`B.
`
`TT’s attempt to horse trade on evidentiary issues is misguided.
`TT blames Petitioners and the Board for its evidentiary shortcomings. (See
`
`Opp. at 1-4, 7-8.) It asserts that there is no justification for the Board to treat the
`
`Biddulph Transcript differently from Petitioners’ Exhibit 1007 (2005 Kawashima
`
`deposition transcript). (Opp. at 3-4.) But TT waived any objection it had to the
`
`admissibility of Exhibit 1007 because it did not move to exclude that evidence.
`
`Rather, TT conceded its admissibility. (See Paper 114 at 3-6.) The uncontested
`
`admissibility of Exhibit 1007 has no bearing here. Moreover, TT was present at the
`
`2005 deposition of Kawashima.
`
`II. Exhibits 2300, 2301, 2304-2316, 2318-2324, 2326, and 2328-2329.
`In response to Petitioners’ authenticity objections, TT asserts that the Third
`
`Party Emails were authenticated by Mr. Hart and Mr. Friesen. (Opp. at 8.)
`
`However, nowhere in their declarations do Messrs. Hart and Friesen attest to the
`
`nature of these exhibits as being true and correct copies of emails of which they
`
`have personal knowledge. It is TT’s burden to produce evidence satisfying FRE
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`
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`- 3 -
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`
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`Case CBM2015-00179
`Patent 7,533,056
`901. TT simply fails in that regard. TT is aware of its shortcoming as it also argues
`
`that that the Third Party Emails are authenticated due to their “distinctive
`
`characteristics” under FRE 901(b)(4). (Opp. at 8-9.) This argument fails as the
`
`emails are not self-authenticating under FRE 902, and TT has offered no extrinsic
`
`evidence to show the existence of any such characteristics. See, e.g., Devbrow v.
`
`Gallegos, 735 F.3d 584, 586-87 (7th Cir. 2013). TT’s argument that Exhibit 2301
`
`(“Trading Game Design Document”) is authenticated likewise fails as TT does
`
`nothing to explain how the general categories of “information printed throughout
`
`the document” qualify as “distinctive characteristics.” Moreover, it claims that
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`these characteristics are “verifiable,” yet offers no evidence verifying any of its
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`claims.
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`In response to Petitioners’ hearsay objections, TT fails to argue that any
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`specific exception applies under FRE 803, 804, or 807. Instead, it argues that the
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`Third Party Emails are not offered for their truth but rather “to show the
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`conception and development of the invention.” (Opp. at 10.) TT’s argument is just
`
`wrong, as Messrs. Hart and Friesen both rely on these exhibits for their truth in an
`
`attempt to establish an actual reduction to practice of the alleged invention. TT’s
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`remaining arguments are likewise meritless. Contrary to TT’s suggestion,
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`Petitioners’ arguments do not “relate to the appropriate weight to assign the
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`evidence” because there is a threshold issue as to whether TT relies upon these out-
`
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`Case CBM2015-00179
`Patent 7,533,056
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`of-court statements for their truth.
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`III. Exhibits 2030 and 2032.
`TT makes the incredible argument that these exhibits are offered for the
`
`purpose of showing how a third-party and a jury reacted to the evidence in these
`
`proceedings. (Opp. at 11.) But as explained in Petitioners’ Motion, the third-party’s
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`and jury’s reactions to the evidence in these proceedings does nothing to make any
`
`facts in this proceeding more or less probable. (See Mot. at 5-6.) Because irrelevant
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`evidence is not admissible, the Board should exclude Exhibits 2030 and 2032
`
`under FRE 402.
`
`
`Respectfully submitted,
`STERNE, KESSLER, GOLDSTEIN & FOX P.L.L.C.
`
`
`
`/Robert Sokohl/
`
`
`
`Robert E. Sokohl (Reg. No. 36,013)
`Lori A. Gordon (Reg. No. 50,633)
`Richard M. Bemben (Reg. No. 68,658)
`Attorneys for Petitioners
`
`
`Date: October 14, 2016
`
`1100 New York Avenue, N.W.
`Washington, D.C. 20005–3934
`(202) 371–2600
`
`
`
`- 5 -
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`
`
`
`
`CERTIFICATE OF SERVICE (37 C.F.R. § 42.6(e))
`The undersigned hereby certifies that the foregoing PETITIONERS’
`
`REPLY TO PATENT OWNER’S OPPOSITION TO MOTION TO
`
`EXCLUDE was served electronically via e–mail on October 14, 2016, in its
`
`entirety on Attorneys for Patent Owner:
`
`Erika H. Arner, Joshua L. Goldberg, Kevin D. Rodkey,
`Rachel L. Emsley, Cory C. Bell
`FINNEGAN, HENDERSON, FARABOW, GARRETT & DUNNER, LLP
`
`Erika.arner@finnegan.com
`Joshua.goldberg@finnegan.com
`Kevin.rodkey@finnegan.com
`Rachel.emsley@finnegan.com
`Cory.bell@finnegan.com
`Trading–Tech–CBM@finnegan.com
`
`Steven F. Borsand
`TRADING TECHNOLOGIES INTERNATIONAL, INC.
`tt–patent–cbm@tradingtechnologies.com
`
`Michael D. Gannon, Leif R. Sigmond, Jr., and Jennifer M. Kurcz
`MCDONNELL BOEHNEN HULBERT & BERGHOFF LLP
`gannon@mbhb.com
`sigmond@mbhb.com
`kurcz@mbhb.com
`
`STERNE, KESSLER, GOLDSTEIN & FOX P.L.L.C.
`
`
`/Robert Sokohl/
`
`
`Date: October 14, 2016
`
`1100 New York Avenue, N.W.
`Washington, D.C. 20005–3934
`(202) 371–2600
`
`
`
`Robert E. Sokohl (Reg. No. 36,013)
`Lori A. Gordon (Reg. No. 50,633)
`Richard M. Bemben (Reg. No. 68,658)
`Attorneys for Petitioners
`
`
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