IPR2013-00083
`Docket No. 0100157-00244
`Filed on behalf of EMC Corporation and VMware, Inc.
`
`By: Peter M. Dichiara, Reg. No. 38,005
`David L. Cavanaugh, Reg. No. 36,476
`WILMER CUTLER PICKERING HALE AND DORR LLP
`peter.dichiara@wilmerhale.com
`david.cavanaugh@wilmerhale.com
`Tel.: 617-526-6466
`Fax: 617-526-5000
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`____________________________________________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`____________________________________________
`
`EMC CORPORATION and VMWARE, INC.,
`Petitioners
`
`v.
`
`Patent Owner of
`U.S. Patent No. 6,415,280 to Farber et al.
`
`IPR Case No. IPR2013-00083
`
`PETITIONERS’ REPLY IN SUPPORT OF ITS
`
`MOTION TO EXCLUDE EVIDENCE
`
`
`
`
`
`
`Docket No. 0100157-00244
`Filed on behalf of EMC Corporation and VMware, Inc.
`
`By: Peter M. Dichiara, Reg. No. 38,005
`David L. Cavanaugh, Reg. No. 36,476
`WILMER CUTLER PICKERING HALE AND DORR LLP
`peter.dichiara@wilmerhale.com
`david.cavanaugh@wilmerhale.com
`Tel.: 617-526-6466
`Fax: 617-526-5000
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`____________________________________________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`____________________________________________
`
`EMC CORPORATION and VMWARE, INC.,
`Petitioners
`
`v.
`
`Patent Owner of
`U.S. Patent No. 6,415,280 to Farber et al.
`
`IPR Case No. IPR2013-00083
`
`PETITIONERS’ REPLY IN SUPPORT OF ITS
`
`MOTION TO EXCLUDE EVIDENCE
`
`
`
`
`
`
`
`IPR2013-00083
`Docket No. 0100157-00244
`U.S. Patent No. 6,415,280
`The Bermeister Declarations and Licenses Should Be Excluded
`
`Patent Owner’s opposition ignores the fundamental principle that, for
`
`evidence to be relevant to the secondary considerations of nonobviousness, it must
`
`be “objective.” See Iron Grip Barbell Co. v. USA Sports, Inc., 392 F.3d 1317,
`
`1323-1324 (Fed. Cir. 2004). Furthermore, there must be an adequate nexus
`
`between the evidence and the challenged claims. See id. Patent Owner has yet to
`
`articulate any such nexus with objective evidence despite repeated opportunities to
`
`do so. Moreover, it does not dispute that its declarant, Chairman Kevin
`
`Bermeister, failed to disclose significant interlocking relationships between the
`
`parties to the Brilliant licenses, as well as inconsistent SEC disclosures regarding
`
`their valuation – both of which negate any “objective” value. The Board
`
`accordingly should exclude the Brilliant licenses (Exs. 2010-12) and the
`
`Bermeister Declarations (Exs. 2009, 2014).
`
`
`
`First, Patent Owner has not established or even articulated any legitimate
`
`nexus to the challenged claims. Relying on Transocean but misapplying its
`
`holding, Patent Owner argues that a sufficient nexus exists so long as the licenses
`
`can be construed to cover the challenged patent, and this nexus is not undermined
`
`by the fact that the licenses also extend to other patents. (Opp. 1-2.) The basis for
`
`the motion to exclude, however, is not that the Brilliant licenses also cover other
`
`patents. The basis for the motion is that there is no evidence that the licenses were
`
`motivated in any way by the challenged claims.
`
`
`
`1
`
`
`
`IPR2013-00083
`Docket No. 0100157-00244
`U.S. Patent No. 6,415,280
`
`
`
`Transocean provides no support for Patent Owner’s argument that a
`
`sufficient nexus exists simply because the licenses cover a large number of patents
`
`(with many hundreds of claims) including the ’280 patent.1 Instead, the Federal
`
`Circuit held that “a reasonable jury could have found that the licenses reflect the
`
`value of the claimed invention,” and the licensed “dual-activity” offshore drilling
`
`technology was the focus of the asserted claims. See Transocean Offshore
`
`Deepwater Drilling, Inc. v. Maersk Drilling USA, Inc., 699 F.3d 1340, 1348, 1353
`
`(Fed. Cir. 2012). In contrast, Patent Owner has yet to identify a single claimed
`
`feature that motivated any of the Exs. 2010-12 licenses. See Honeywell Int’l, Inc.
`
`v. Nikon Corp., No. 04-01337, 2009 WL 577274, at *1-2 (D. Del. Mar. 4, 2009)
`
`(Ex. 1082) (excluding licenses that covered the challenged patent because they
`
`“lacked a sufficient nexus to the asserted patent claim” (emphasis added), aff’d,
`
`400 Fed. Appx. 557 (Fed. Cir. Nov. 1, 2010); see also Tokai Corp. v. Easton
`
`Enters., Inc., 632 F.3d 1358, 1369-70 (Fed. Cir. 2011) (no weight if no nexus
`
`established).
`
`
`
`Second, Patent Owner does not dispute that Bermeister’s declarations (Exs.
`
`2009, 2014) failed to disclose the prior and contemporaneous business
`
`relationships between the parties to the Kinetech, Sharman, and Skype licenses
`
`(Exs. 2010-12), as well as the inconsistent SEC disclosures regarding their
`
`1 Only 2 of 55 claims of the ’280 patent have been challenged in this proceeding.
`
`
`
`2
`
`
`
`IPR2013-00083
`Docket No. 0100157-00244
`U.S. Patent No. 6,415,280
`
`valuation. (See Motion ¶¶ 3-4, 6-7, 9-10.) These material omissions alone warrant
`
`exclusion. See 37 C.F.R. § 42.12 (exclusion for violations of Rule 42.11 and Rule
`
`42.51).
`
`Third, the complex web of interlocking private equity ownership interests
`
`and parallel licensing transactions between the Exs. 2010-12 licensing parties
`
`negate any argument that the licenses provide “objective” evidence of the value of
`
`the claims. (See Motion ¶¶ 3, 6, 9.) The licenses do not provide “objective”
`
`evidence simply because they were entered outside litigation. Nor are the
`
`relationships between the parties comparable to Ford and Chevrolet’s “overlapping
`
`business interests.” Ford and Chevrolet are not joint, private ventures with
`
`interlocking ownership interests that routinely exchange monies in complex
`
`parallel licensing transactions. Moreover, while Patent Owner claims that
`
`Bermeister had no “personal interest” in Skype on the day the Skype license was
`
`signed, it is undisputed that Bermeister had indirect ownership interests both
`
`before and after, including the inexplicable transfer of a 1% equity stake in Skype
`
`to his family company (SEP Investments) shortly after the signing.2 (See Motion ¶
`
`9.) See Ex parte Baylor Coll. Of Med., No. 2012-005140, 2012 WL 2316829, at
`
`*9 (B.P.A.I. June 15, 2012) (license given no weight where patentee failed to show
`
`2 Given the suspect nature of these transactions, the Board also should exclude this
`
`evidence under FRE 403.
`
`
`
`3
`
`
`
`IPR2013-00083
`Docket No. 0100157-00244
`U.S. Patent No. 6,415,280
`
`it was due to merits of claimed inventions rather than other business reasons); see
`
`also In re DBC, 545 F.3d 1373, 1384 (Fed. Cir. 2008) (evidence of secondary
`
`considerations only relevant if a “direct result of the unique characteristics of the
`
`claimed invention – as opposed to other economic and commercial factors”).
`
`
`
`Fourth, Exs. 2009-12, 2014 also should be excluded because Bermeister did
`
`not provide any reasonable basis or explanation for his estimated “value” of any of
`
`the licenses, and his testimony is utterly lacking in reliability. See, e.g., Utah
`
`Med. Prods., Inc. v. Graphic Controls Corp., 350 F.3d 1376, 1385-86 (Fed. Cir.
`
`2003) (affirming exclusion of licenses and valuation testimony as unreliable); Tex.
`
`Digital Sys., Inc. v. Telegenix, Inc., 308 F.3d 1193, 1217-18 (Fed. Cir. 2002).
`
`Patent Owner does not dispute that Bermeister failed to disclose SEC filings that
`
`were inconsistent with his valuations for the Kinetech and Sharman licenses. Nor
`
`does it dispute that Bermeister lacked personal knowledge of the money allegedly
`
`paid for the Skype license (which on the face of the agreement did not specify any
`
`consideration paid to Brilliant or Altnet). His “valuation” testimony accordingly
`
`lacks foundation, is unreliable on its face, and should be excluded.
`
`For these reasons, the Board should grant Petitioners’ Motion to Exclude.
`
`
`
`4
`
`
`
`
`
`
`
`
`
`
`IPR2013-00083
`Docket No. 0100157-00244
`U.S. Patent No. 6,415,280
`
`
`
`Dated: November 26, 2013
`
`/Peter M. Dichiara/
`
`Respectfully Submitted,
`
`Peter M. Dichiara
`Registration No. 38,005
`Cynthia Vreeland
`Admitted pro hac vice
`WILMER CUTLER PICKERING
`HALE AND DORR LLP
`60 State Street
`Boston, Massachusetts 02109
`peter.dichiara@wilmerhale.com
`Tel.: 617-526-6466
`Fax: 617-526-5000
`
`
`
`
`
`
`5
`
`
`
`IPR2013-00083
`Docket No. 0100157-00244
`U.S. Patent No. 6,415,280
`CERTIFICATE OF SERVICE
`
`I hereby certify that on November 26, 2013, I caused a true and correct copy
`
`of the following materials:
`
` Petitioners’ Reply In Support of Its Motion to Exclude Evidence
`
`to be served via email on the following counsel of record for Patent Owner:
`
`Joseph A. Rhoa, Lead Counsel
`USPTO Reg. No. 37,515
`NIXON & VANDERHYE P.C.
`901 North Glebe Road, 11th Floor
`Arlington, VA 22203-1808
`jar@nixonvan.com
`Tel.: 703-816-4043
`
`Updeep S. Gill, Backup Counsel
`USPTO Reg. No. 37,344
`NIXON & VANDERHYE P.C.
`901 North Glebe Road, 11th Floor
`Arlington, VA 22203-1808
`usg@nixonvan.com
`Tel.: 703-816-4030
`
`/Heather M. Petruzzi/
`Heather M. Petruzzi
`Reg. No. 71,270
`
`6
`
`
`
`
`
`
`
`
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