Paper No.
`Filed: July 8, 2014
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`UNITED STATES PATENT AND TRADEMARK OFFICE
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`NETFLIX, INC.
`Petitioner
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`v.
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`OPENTV, INC.
`Patent Owner
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`Case IPR2014-00267
`Patent 7,409,437
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`Patent Owner OpenTV, Inc.’s
`Request for Rehearing Under 37 C.F.R. § 42.71(c)
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`Filed: July 8, 2014
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`UNITED STATES PATENT AND TRADEMARK OFFICE
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`
`
`
`
`
`
`
`
`
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`
`
`
`
`
`
`
`
`
`
`
`
`NETFLIX, INC.
`Petitioner
`
`v.
`
`OPENTV, INC.
`Patent Owner
`
`
`
`
`
`
`
`Case IPR2014-00267
`Patent 7,409,437
`
`
`
`
`
`
`
`
`
`
`Patent Owner OpenTV, Inc.’s
`Request for Rehearing Under 37 C.F.R. § 42.71(c)
`
`
`
`
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`
`
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`
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`Case No. IPR2014-00267
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`Table of Contents
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`I.
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`II.
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`Introduction and Statement of Relief Requested ............................................. 1
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`Legal Standards ............................................................................................... 1
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`III. The Board Misapprehended, and Thus Failed to Adhere to, the Law
`Governing When Institution Is Permitted ........................................................ 2
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`IV. Conclusion ....................................................................................................... 6
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`i
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`Case No. IPR2014-00267
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`
`Table of Authorities
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`FEDERAL CASES
`Eli Lilly & Co. v. Bd. of Regents of the Univ. of Wash.,
`334 F.3d 1264 (Fed. Cir. 2003) ............................................................................ 2
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`Page(s)
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`Stevens v. Tamai,
`366 F.3d 1325 (Fed. Cir. 2004) ............................................................................ 2
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`FEDERAL STATUTES
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`35 U.S.C. § 102 .......................................................................................................... 3
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`35 U.S.C. § 103 .......................................................................................................... 1
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`35 U.S.C. § 312 ...................................................................................................... 1, 3
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`35 U.S.C. § 314 .................................................................................................passim
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`
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`FEDERAL REGULATIONS
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`37 C.F.R. § 42.71 ................................................................................................... 1, 2
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`
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`OTHER AUTHORITIES
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`IPR2013-00186, Paper 34 (Oct. 23, 2013) ................................................................ 4
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`IPR2012-00027, Paper 26 (Jun. 11, 2013) ................................................................. 5
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`
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`ii
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`Case No. IPR2014-00267
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`I.
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`Introduction and Statement of Relief Requested
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`Pursuant to 37 C.F.R. §§ 42.71(c)-(d), Patent Owner, OpenTV, Inc., requests
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`rehearing of the Decision instituting Inter Partes Review of U.S. Patent No.
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`7,409,437 (Paper 13, the “Institution Decision”). The Institution Decision ordered
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`review on two grounds of unpatentability: claim 1 as unpatentable under 35
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`U.S.C. § 103(a) over Palmer (U.S. Patent No. 5,905,865) (“Palmer” or “the Palmer
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`patent”) and Romesburg (U.S. Patent No. 5,113,259); and claims 2-4 as
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`unpatentable under 35 U.S.C. § 103(a) over Palmer and Batchelor (U.S. Patent No.
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`5,724,103). OpenTV requests that the Board reconsider and reverse its decision to
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`institute on both Palmer grounds because the Decision misapprehended the law
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`governing when the Board is authorized to institute (and prohibited from
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`instituting) trial. Therefore, no trial should be instituted on the ’437 patent.
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`II. Legal Standards
`“The Director may not authorize an inter partes review to be instituted
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`unless the Director determines that the information presented in the petition
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`filed under section 311 and any response filed under section 313 shows that there
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`is a reasonable likelihood that the petitioner would prevail with respect to at least 1
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`of the claims challenged in the petition.” 35 U.S.C. § 314(a) (emphasis added).
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`Consistent with this statute, 35 U.S.C. § 312(a)(3) provides that “[a] petition under
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`section 311 may be considered only if . . . the petition identifies, in writing and
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`with particularity . . . the evidence that supports the grounds for the challenge to
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`Case No. IPR2014-00267
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`each claim.”
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`A request for rehearing “must specifically identify all matters the party
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`believes the Board misapprehended or overlooked, and the place where each
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`matter was previously addressed in a motion, an opposition, or a reply.” 37 C.F.R.
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`§ 42.71(d). “When rehearing a decision on petition, a panel will review the
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`decision for an abuse of discretion.” 37 C.F.R. § 42.71(c). “An abuse of discretion
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`occurs where the decision (1) is clearly unreasonable, arbitrary, or fanciful; (2) is
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`based on an erroneous conclusion of law; (3) rests on clearly erroneous fact
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`findings; or (4) involves a record that contains no evidence on which the Board
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`could rationally base its decision.” Stevens v. Tamai, 366 F.3d 1325, 1330 (Fed.
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`Cir. 2004) (quoting Eli Lilly & Co. v. Bd. of Regents of the Univ. of Wash., 334
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`F.3d 1264, 1266-67 (Fed. Cir. 2003)).
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`III. The Board Misapprehended, and Thus Failed to Adhere to, the Law
`Governing When Institution Is Permitted
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`A petition for inter partes review may not be instituted unless the petition
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`itself shows that there is a reasonable likelihood that at least one claim is
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`unpatentable. 35 U.S.C. § 314(a). The Institution Decision violated this provision
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`by instituting trial when the Petition did not even arguably present or contain the
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`necessary information. In particular, the Palmer grounds proposed in the Petition
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`could not be instituted because the Petition did not show how any of the Palmer
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`2
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`Case No. IPR2014-00267
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`patent, filed after the ’437 patent, is or could be prior art under 35 U.S.C. § 102. In
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`particular, the Petition failed to show or even suggest how any of the cited subject
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`matter of the Palmer patent is contained in an earlier filed provisional patent
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`application (“the Palmer provisional”), even though that is the only way that any
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`part of the Palmer patent could be prior art to the ’437 patent.1 Paper 11 at 14.
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`Instead, the Petition simply stated that “[f]or each element of the Palmer patent
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`identified below, there is a corresponding teaching in the provisional applications,”
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`Paper 11 at 15 (citing Pet. 33-34), and listed a string of citations to pages of the
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`Palmer provisional for some claim elements, see, e.g., Paper 11 at 15 (citing Pet.
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`39 (“NTFX-1007 [the Palmer patent], 8:13-19; see NTFX-1008 [the Palmer
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`provisional], pp. 1, 3.”)). But neither the mere assertion nor the string citations
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`constitute a “show[ing]” under 35 U.S.C. § 314(a) that the Palmer patent actually
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`qualifies as prior art to any of the claims, because they are insufficient to establish
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`grounds with the particularity required by 35 U.S.C. § 312. Indeed, the Board
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`previously denied a request for rehearing premised on string citations in a petition
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`because the petition did “not point out with particularity [a portion of a prior art
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`reference] or how it satisfies certain claim limitations.” Paper 11 at 15 (citing
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`1 No other application leading to the Palmer patent was filed before March 8, 1996,
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`the effective filing date of the ’437 patent. NTFX-1007 at 1; NTFX-1001 at 1.
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`3
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`Case No. IPR2014-00267
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`IPR2013-00186, Paper 34 (Oct. 23, 2013), at 3). The Petition thus fails to establish
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`a reasonable likelihood of prevailing on any claim as required by 35 U.S.C. § 314.
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`The Decision instituting the Petition’s Palmer grounds overlooked the
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`failings of the Petition related to the prior art status of the Palmer patent,
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`erroneously supplementing the information presented in the Petition to create a
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`showing instead of determining whether the Petition contained the required
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`showing under 35 U.S.C. § 314. In particular, although the Decision correctly
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`recognized that the Palmer patent is only prior art to the extent that its subject
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`matter is disclosed in the Palmer provisional, Paper 13 at 13, the Decision did not
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`identify any showing in the Petition of how the cited subject matter of the Palmer
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`patent is disclosed in the Palmer provisional. Instead, the Decision simply cited
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`particular passages of the Palmer provisional to cobble together and institute the
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`Palmer grounds. Paper 13 at 12-19. But none of the Board’s showing was in the
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`Petition, which just generally referenced multiple pages of the Palmer provisional
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`in string citations. See, e.g., Paper 11 at 15 (citing Pet. 39). By filling in gaps in
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`the showing of the Petition and taking it upon itself to make a case that a
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`reasonable likelihood of prevailing could exist, the Board committed legal error.
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`This error permeated the Decision to institute all of the challenged claims. Paper
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`13 at 17-19.
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`4
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`Case No. IPR2014-00267
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` 35 U.S.C. § 314(a)—the statute that governs when the Board is permitted
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`to institute trial—states that “[t]he Director may not authorize an inter partes
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`review to be instituted unless the Director determines that the information
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`presented in the petition . . . shows that there is a reasonable likelihood that the
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`petitioner would prevail with respect to at least 1 of the claims challenged in the
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`petition.” (Emphasis added). This provision of the statute expressly prohibits the
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`Board from instituting inter partes review if the information presented in the
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`Petition itself does not show a reasonable likelihood that the Petitioner would
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`prevail. It does not allow the Board to make its own case to establish that a
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`reasonable likelihood of prevailing might exist by filling in gaps in the Petition.
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`Nonetheless, that is what the Institution Decision did, misapprehending and
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`ignoring the clear mandate of 35 U.S.C. § 314.
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`Consistent with 35 U.S.C. § 314(a), the Board’s role is to judge the
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`sufficiency of a petition, not to make a case for a petitioner who failed to do so. As
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`the Board has stated, an inter partes review is more akin to an adjudicatory
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`proceeding than an examination of the challenged patent. Idle Free Sys., Inc. v.
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`Bergstrom, Inc., IPR2012-00027, Paper 26 (Jun. 11, 2013), at 6. “An inter partes
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`review is neither a patent examination nor a patent reexamination.” Id. at 7. By
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`impermissibly creating its own showing and filling gaps in the Petition, as it did
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`here, the Board misapprehended its role as an adjudicator. As the Board has
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`Case No. IPR2014-00267
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`previously stated, its role is only to adjudicate the sufficiency of the petition, not to
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`act as an examiner.
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`By failing to judge the Petition on its contents alone and looking beyond the
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`information presented in the Petition to establish a reasonable likelihood of
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`prevailing, the Institution Decision violated 35 U.S.C. § 314(a). This was
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`improper, so the Board should reconsider and reverse its institution decision.
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`IV. Conclusion
`For the foregoing reasons, OpenTV requests that the Board deny the Palmer
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`grounds proposed in the Petition, and decline to institute Inter Partes Review of
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`Respectfully submitted,
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`
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`By:
`Erika H. Arner
`Registration No. 57,540
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`Joshua L. Goldberg
`Registration No. 59,369
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`Counsel for OpenTV, Inc.
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`the ’437 patent.
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`Dated: July 8, 2014
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`6
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`CERTIFICATE OF SERVICE
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`The undersigned hereby certifies that a copy of the foregoing Patent Owner
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`OpenTV, Inc.’s Request for Rehearing Under 37 C.F.R. § 42.71(c) was served
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`on July 8, 2014 via FedEx and email directed to counsel of record for the Petitioner
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`at the following:
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`Andrew S. Ehmke
`andy.ehmke.ipr@haynesboone.com
`Scott Jarratt
`scott.jarratt.ipr@haynesboone.com
`HAYNES AND BOONE, LLP
`2323 Victory Ave., Suite 700
`Dallas, Texas 75219
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`/Ashley F. Cheung/
`Ashley F. Cheung
`Case Manager
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`Finnegan, Henderson, Farabow,
`Garrett & Dunner, LLP
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