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`_________________________
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`_________________________
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`FORD MOTOR COMPANY
`Petitioner,
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`v.
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`PAICE LLC & ABELL FOUNDATION, INC.
`Patent Owners.
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`_________________________
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`Case IPR2014-00579
`Patent 7,104,347
`_________________________
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`PATENT OWNER’S MOTION TO EXCLUDE
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`TABLE OF CONTENTS
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`Case IPR2014-00579
`Patent 7,104,347
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`I. STATEMENT OF PRECISE RELIEF REQUESTED ................................. 1
`II. STATEMENT OF MATERIAL FACTS ..................................................... 1
`III. BACKGROUND ............................................................................................. 2
`IV. DISCUSSION .................................................................................................. 5
`A. The Challenged Exhibit and the Challenged Testimony are untimely
`submissions of new evidence. ................................................................................ 5
`Ford should not be allowed to remedy a deficient petition with additional
`B.
`evidence and expert testimony. .............................................................................. 9
`V. CONCLUSION ............................................................................................. 13
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`i
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`Case IPR2014-00579
`Patent 7,104,347
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`EXHIBITS
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`Patent Owner
`Exhibit Number
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`Exhibit Description
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`PAICE Ex. 2101 Arbitration Agreement between Paice LLC and Ford Motor
`Company
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`PAICE Ex. 2102 Declaration of Neil Hannemann
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`PAICE Ex. 2103 Neil Hannemann CV
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`PAICE Ex. 2104 Masding, Philip Wilson (1988) “Some drive train control
`problems in hybrid i.c engine/battery electric vehicles,”
`Durham theses, Durham University.
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`PAICE Ex. 2105
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`Bosch Handbook, 4th Edition (excerpts)
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`PAICE Ex. 2106 Gregory Davis Deposition Transcript (Jan. 13, 2015)
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`PAICE Ex. 2107 Davis, G. W., Hodges, G. L., and Madeka, F. C., "The
`Development and Performance of the AMPhibian Hybrid
`Electric Vehicle,” SAE Technical Publication 940337, 1994.
`
`PAICE Ex. 2108
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`Paice v. Ford, C.A. No. 1:14-cv-00492-WDQ, Complaint
`(Feb. 19, 2014)
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`PAICE Ex. 2109 Griffith Hack Report
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`PAICE Ex. 2110 Declaration in support of motion for Pro Hac Vice of Peter
`Guarnieri
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`PAICE Ex. 2111
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`Transcript of Deposition of Gregory W. Davis, Ph.D.
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`PAICE Ex. 2112
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`Bumby, J.R. and I. Forster, “Optimisation and Control of a
`Hybrid Electric Car,” IEEE Proceedings, Vol. 134, Pt. D, No.
`6, November 1987
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`PAICE Ex. 2113
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`Patent Owner’s Notice of Objections to Evidence, IPR2014-
`00579, April 29, 2015
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`ii
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`Case IPR2014-00579
`Patent 7,104,347
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`STATEMENT OF PRECISE RELIEF REQUESTED
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`Patent Owners Paice LLC & The Abell Foundation, Inc. (collectively
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`“Paice”) move to exclude from evidence Exhibit 1144 (the “Challenged Exhibit”).
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`Paice moves to exclude the Challenged Exhibit as untimely and impermissibly
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`outside the scope of the Petitioner Ford Motor Company’s (“Ford”) reply under 37
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`C.F.R. § 42.23. Paice also moves to exclude from evidence the testimony in
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`paragraphs 63-65 of Exhibit 1140 (“Challenged Testimony”), on the same grounds.
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`If the Challenged Exhibit and Challenged Testimony are excluded, Paice further
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`moves that the exhibit and testimony be expunged from the record. Paice also
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`respectfully requests that the Board preclude Ford from using the Challenged
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`Exhibits or the Challenged Testimony at any hearing or in any paper in this
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`proceeding.
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`STATEMENT OF MATERIAL FACTS
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`Ford filed the Challenged Exhibit and the Challenged Testimony with its
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`April 22, 2015 Reply to Patent Owner’s Response. See Paper 28.
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`Paice timely objected to the Challenged Exhibits and the Challenged
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`Testimony on April 29, 2015. See Ex. 2113.
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`Paice objected to the exhibit and testimony as outside the permitted scope of
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`the reply. See id. at 2.
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`1
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` BACKGROUND
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`Case IPR2014-00579
`Patent 7,104,347
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`In its petition in this IPR, Ford argued that the Bumby references disclosed
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`the limitation “a battery, for providing current to said motors [said first and second
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`motors] and accepting charging current from at least said second motor” by
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`pointing to the traction motor. The entirety of Ford’s argument is reproduced
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`below:
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`As illustrated in the figure shown in limitation [1.0] above, the
`Bumby Project discloses “a battery” that is connected electrically to
`the electric motor via a corresponding motor controller. (Ex. 1104 at
`1.) The Bumby Project discloses that the battery provides current to
`the motor, for instance, in an “electric mode” where all “propulsion
`power [is] supplied by the electric traction system.” (Ex. 1105 at 5-
`Table 2.) The Bumby Project also discloses a “regenerative braking”
`mode where “during braking the vehicle kinetic energy is returned to
`the battery, with the traction motor acting as a generator.” (Ex. 1105
`at 5; Ex. 1108, Davis ¶¶259-265.)
`
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`See Paper 1 at 34-35. What Ford’s petition is completely silent on is that the claim
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`element requires more than a single motor connected to a battery: it clearly
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`requires a battery that provides current to both the first and second motor.
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`Ford relied on their expert Dr. Davis to put forward the argument that it
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`would have been obvious to a person of skill in the art to connect the conventional
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`starter motor disclosed by the Bumby references (which Ford relies on for the “first
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`electric motor”) to the high voltage hybrid battery. See Ex. 1108 at ¶ 263. Dr.
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`Davis however, provided only the purely conclusory argument that it was obvious
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`2
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`to connect motors to power sources. See id. (citing to Ex. 1134, the Bosch
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`Case IPR2014-00579
`Patent 7,104,347
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`Automotive Handbook). Dr. Davis’ reasoning, however, did not address the
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`pertinent issue: why it would be obvious to connect the 12 volt conventional
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`starter motor in the Bumby references to the 216 volt hybrid traction battery where
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`the Bumby references used a separate 12 volt battery system to power the
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`conventional starter motor. See Paper 20, Patent Owner Response, at 37-42.
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`In their Patent Owner Response, Paice highlighted this failure. See Paper 20
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`at 37-39; see also Exhibit 2102 at 42-45. At the time of that Response, Paice and
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`their expert Mr. Hannemann addressed the only evidence put forward by Ford and
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`Dr. Davis in support of Petitioner’s arguments.
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`Realizing that their petition had been woefully inadequate, Ford’s Reply
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`identified for the first time a litany of new arguments and evidence. First, Ford
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`claimed that they provided sufficient argument that the claim element was obvious,
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`and tellingly cited not to their brief, but to Dr. Davis’ declaration:
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`First, Ford never presented an anticipation argument relying on the
`express teachings of the Bumby references but instead argued that it
`was obvious to provide current to a conventional starter motor from
`the recited battery. (Ex. 1108, Davis Dec. at ¶¶263-264.)
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`See Paper 28 at 14 (emphasis added). Second, Ford offered the new argument that
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`the claim limitation can be met by an “indirect” connection between the
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`conventional starter motor and the hybrid battery. See id. at 15-16. To support this
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`3
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`new argument, Ford relied on a new opinion offered by Dr. Davis, i.e. that it would
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`Patent 7,104,347
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`have been obvious to connect the 12 volt conventional starter motor in the Bumby
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`references with the high voltage battery by way of certain power electronics. See
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`id. at 16-17; Ex. 1140 at ¶¶ 63-65.
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`In turn, Dr. Davis relies on two new references as support for this new
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`opinion: European Patent App. EP0136055 and the Challenged Exhibit, U.S.
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`Patent 5,285,862. Neither of these references were put forward or cited to by Ford
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`in their petition, and Dr. Davis made no mention of either in his original
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`declaration.
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`During Dr. Davis’ May 8, 2015 deposition, Dr. Davis confirmed that Ford’s
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`lawyer’s provided him with the Challenged Exhibit. (Ex. 2111, at 68:18-21). He
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`also agreed that Paice’s expert Mr. Hanneman could not have had the opportunity
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`to address Dr. Davis’ opinions with regards to the Challenged Exhibit. (Id. at 68:2-
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`69:20) Incredibly, Ford’s counsel then used a series of leading questions on re-
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`direct to insert additional disclosure from the Challenged Exhibit into the record.
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`(Id. at 98:20-101:9). Dr. Davis agreed that none of the material he was asked to
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`read into the record by Ford’s counsel was cited in his original or his reply
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`declaration. (Id. at 103:13-104:14).
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`4
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` DISCUSSION
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`Case IPR2014-00579
`Patent 7,104,347
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`Ford’s belated and untimely injection of the Challenged Exhibit and the
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`Challenged Testimony should be rejected by the Board. This new evidence is
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`clearly outside the scope of Ford’s reply under 37 C.F.R. § 42.23: rather than reply
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`to Paice’s arguments, Ford is trying to use their Reply to insert new evidence and
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`arguments that could have (and should have) been presented in the petition.
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`Additionally, the Challenged Exhibit and the Challenged Testimony are a
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`transparent attempt to remedy Ford’s facially deficient petition, which failed to
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`fully explain the grounds for the requested relief and instead relied on
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`incorporating Dr. Davis’ testimony by reference.
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`A. The Challenged Exhibit and the Challenged Testimony are
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`untimely submissions of new evidence.
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`“[A] reply that raises a new issue or belatedly presents evidence will not be
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`considered and may be returned” as “[t]he Board will not attempt to sort proper
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`from improper portions of the reply.” See Office Patent Trial Practice Guide, 77
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`Fed. Reg. 157, 48767 (Aug. 14, 2012). The submission of new evidence that (i) is
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`necessary to make out a prima facie case of unpatentability of an original claim has
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`been submitted with a reply or (ii) could have been presented in a prior filing
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`indicates that a new issue has been improperly raised in the reply. See id. Ford’s
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`Reply and new evidence raise both of these red flags: the Challenged Exhibit and
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`5
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`the Challenged Testimony are (i) necessary to make out a prima facie case of
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`unpatentability and (ii) could have been presented in the petition.
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`First, Ford’s brief argued only that the traction motor disclosed by the
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`Bumby references showed that the battery limitation was met. See Paper 1 at 34-
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`35. Ford elsewhere identified the traction motor in Bumby as the “second electric
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`motor,” and the conventional starter motor as the “first electric motor.” See id. at
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`32-34. Because the plain language of the claims clearly requires providing current
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`to both the first and second motors (see Ex. 1101 at col. 58:23-25), explanation and
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`evidence of providing current from the battery to the conventional starter motor
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`(i.e. what Ford alleges is the “first electric motor”) is necessary to make out a
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`prima facie case of unpatentability. Ford’s petition does not provide any such
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`evidence or explanation. Instead, Ford now relies on the Challenged Exhibit and
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`the Challenged Testimony for this limitation, both of which appear for the first
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`time in Ford’s reply.
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`Second, the Challenged Exhibit and the Challenged Testimony could have
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`been presented in the petition. The Challenged Exhibit and European Patent App.
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`EP0136055 (referred to in the Challenged Testimony) are patent documents that
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`were available to Ford long before the filing of the petition. Indeed, Dr. Davis
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`testified during his deposition that he located European Patent App. EP0136055 in
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`6
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`the ’347 patent’s file history, but did not explain why that was not done until
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`Ford’s reply. (Ex. 2111, at 67:15-17).
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`This is not a situation where Ford is merely using this new evidence to reply
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`to a “new” argument raised by Paice. Under the Board’s rules, Ford’s petition was
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`required to contain “a detailed explanation of the significance of the evidence
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`including material facts.” See 37 C.F.R. § 42.22(a)(2). In essence, Paice’s
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`argument was that Ford’s petition was deficient in that regard because the petition
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`did not provide any evidence or argument that the high voltage battery of the
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`Bumby references provided current to the conventional 12 volt starter motor. That
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`Ford now seeks to remedy that deficiency with their Reply clearly shows that the
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`Challenged Exhibit and Challenged Testimony are “improper” and outside the
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`scope of their Reply. See Office Patent Trial Practice Guide, 77 Fed. Reg. 157,
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`48767 (Aug. 14, 2012).
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`Similarly, this is not a situation where Ford and Dr. Davis are merely
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`providing evidence of the knowledge of one of skill in the art. Rather, to meet the
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`“battery” claim limitation Ford and Dr. Davis were required to explain how and
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`why it would have been obvious to modify the system of the Bumby references to
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`7
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`connect a high voltage battery to the 12 volt conventional starter motor.1 That
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`Patent 7,104,347
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`evidence and explanation was missing from the petition and related declaration.
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`To hold that the new evidence and arguments are merely explanations of the
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`knowledge of one of skill in the art (rather than evidence that the claim limitation
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`is allegedly obvious) would allow Ford and other petitioners to rely on conclusory
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`blanket statements in the petition that a claim limitation would be obvious,2 and
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`use the patent owner’s responses as a roadmap to later ambush patent owners with
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`evidence purportedly backing up those blanket statements in their Reply.
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`Effectively, because Ford’s new evidence and arguments were not presented
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`with the petition, Paice now has no opportunity to respond to the evidence that
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`goes directly to one of the challenged claims’ limitations. As Dr. Davis testified,
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`there’s no way Paice’s expert Mr. Hannemann could have even considered Dr.
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`Davis’ position on the issue. (Ex. 2111 at 68:2-69:20). To consider such belated
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`1 Notably, the record shows that the “test rig” in the Bumby references used a
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`separate 12 volt battery system to power the conventional starter motor, similar to
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`Dr. Davis’ own prior hybrid work. See Paper 20, Patent Owner Response, at 37-42.
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`2 As explained in more detail below however, Ford did not make the relevant
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`obviousness argument, but instead attempted to incorporate Dr. Davis’ testimony
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`by reference.
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`8
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`evidence would substantially prejudice Paice and would encourage petitioners to
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`Case IPR2014-00579
`Patent 7,104,347
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`sandbag patent owners by withholding evidence in support of the prima facie case
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`of alleged unpatentability for the Reply. These kind of tactics put Paice and other
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`patent owners in the untenable position of pointing out the gaps in a petitioner’s
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`case, only to have those gaps filled with new expert testimony and new evidence
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`that patent owners have no opportunity to respond to. That is clearly not fair, and
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`is not permitted by the rules. See Corning v. DSM, IPR2013-0047, Paper 84, p. 17
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`(P.T.A.B. May 1, 2014) (“We do not believe it to be in the interest of justice at this
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`late stage of the case to impose additional financial expense on [the patent owner]
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`to respond to the ‘new’ evidence it asks us not to consider…. Inter partes review
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`proceedings must be fair to both parties, including a patent owner—where
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`properties rights can be extinguished through cancellation of patent claims.”)
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`B.
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`Ford should not be allowed to remedy their deficient petition with
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`additional evidence and expert testimony.
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`Ford’s petition was deficient for an additional reason: rather than present the
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`basis for their obviousness arguments with respect to the battery limitation, they
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`merely incorporated Dr. Davis’ declaration. And even the testimony of Dr. Davis’
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`that Ford relies on was woefully inadequate. The Challenged Exhibit and
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`Challenged Testimony are a belated attempt to remedy that deficiency with new
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`9
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`arguments, evidence, and testimony from Dr. Davis, which should have been in the
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`Patent 7,104,347
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`petition in the first instance.
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`In the first instance, Dr. Davis’ original declaration at best offered the
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`conclusory argument that it would be obvious to connect a motor to a battery.
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`However, a comparison of his original declaration at Exhibit 1108, ¶¶ 259-265 and
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`his reply declaration at Exhibit 1140, ¶¶ 63-65, shows that he offered no evidence
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`or argument in his original declaration that it would be obvious “that 12-volt
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`components, such as a conventional starter motor, could be connected to a high
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`voltage battery.” See Exhibit 1140 at ¶ 63. That opinion, and the evidence in
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`support thereof, is entirely new.
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`Even putting aside the vague and conclusory testimony of Dr. Davis, Ford’s
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`petition was deficient because rather than putting their obviousness arguments in
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`the petition, Ford attempted to incorporate Dr. Davis’ testimony by reference. The
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`Board’s rules are clear however that “[a]rguments must not be incorporated by
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`reference from one document into another document.” See 37 CFR § 42.6(a)(3).
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`As the Board explained in Fidelity National v. DataTreasury, incorporating
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`declaration testimony by reference in the petition runs afoul of those rules:
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`Under our rules, the petition must contain a “full statement of the
`reasons for the relief requested, including a detailed explanation of
`the significance of the evidence . . . .” 37 C.F.R. § 42.22(a)(2). We,
`therefore, decline
`to consider
`information presented
`in a
`supporting declaration, but not discussed sufficiently in a petition;
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`among other reasons, doing so would permit the use of declarations
`to circumvent the page limits that apply to petitions. For the same
`reasons, our rules prohibit arguments made in a supporting document
`from being incorporated by reference into a petition. See 37 C.F.R.
`§ 42.6(a)(3).
`Fidelity National v. DataTreasury, IPR2014-00491, Paper 9, p. 8 (P.T.A.B. Aug.
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`13, 2014) (emphasis added); see also Tempur Sealy Int’l Inc. v. Select Comfort
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`Corp., IPR2014-01419, Paper 7, at p. 7 (P.T.A.B. Feb. 17, 2015) (refusing to
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`consider obviousness argument in declaration but not in petition); Micro Motion,
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`Inc. v. Invensys Systems, Inc., IPR2014-0393, Paper 16, p. 16 (P.T.A.B. Aug. 4,
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`2014) (refusing to consider argument improperly incorporated by reference from
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`claim chart, where the obviousness analysis was lacking in the petition); Shaw
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`Industries Group, Inc. v. Automated Creel Sys., Inc., IPR2013-00584, Paper 16, p.
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`10 n.5 (P.T.A.B. Dec. 21, 2013) (refusing to consider argument improperly
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`incorporated by reference).
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`Similarly, in Cisco v. C-Cation Technologies, the Board stated that the
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`“practice of citing the Declaration to support conclusory statements that are not
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`otherwise supported in the Petition also amounts to incorporation by reference.”
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`IPR2014-00454, Paper 12, p. 9 (P.T.A.B. Aug. 29, 2014).
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`That is precisely what Ford has done here: Ford did not provide any
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`evidence or explanation for why it would be obvious to provide current from the
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`high voltage battery in the Bumby references to the conventional 12 volt starter
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`11
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`motor, but simply cited to Dr. Davis’ conclusory and unsupported testimony. See
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`Paper 1 at 34-35. Ford’s Reply essentially concedes this point: while they allege
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`that the petition contained an argument “that it was obvious to provide current to a
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`conventional starter motor from the recited battery,” the only citation they provide
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`is to Dr. Davis’ declaration. See Paper 28 at 14. In other words, Ford agrees that
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`Dr. Davis allegedly presented such an argument, not Ford’s petition.
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`Ford’s Reply, and the Challenged Exhibits and Challenged Testimony, are a
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`belated attempt to fix this deficiency in the petition. By offering new evidence and
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`new arguments in the Reply, Ford is using its Reply to provide the “detailed
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`explanation of the significance of the evidence including material facts” that
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`should have been in the petition in the first instance. See 37 C.F.R. § 42.22(a)(2).
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`Ford should not be allowed to rely on their petition’s incorporation-by-reference of
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`Dr. Davis’ arguments3 to now argue that their Reply, and the Challenged Exhibits
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`and Challenged Testimony, are simply a clarification or explanation of their prior
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`position. Holding otherwise would allow petitioners to bury the “detailed
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`explanation of the significance of the evidence including material facts” in an
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`3 And as noted above, Dr. Davis’ arguments are also conclusory and lacking any
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`support.
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`12
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`expert declaration, and later provide that explanation in a Reply when patent
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`Patent 7,104,347
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`owners no longer have any opportunity to respond.
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` CONCLUSION
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`For the reasons set forth above, Paice respectfully requests that the Board
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`exclude the Challenged Exhibit 1144, and the Challenged Testimony (paragraphs
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`63-65 of Exhibit 1140). Paice further moves that the Challenged Exhibit and
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`Challenged Testimony be expunged from the record, and that Ford be precluded
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`from using the Challenged Exhibit or the Challenged Testimony at any hearing or
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`in any paper in this proceeding.
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`Dated: May 15, 2015
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`By: /Timothy W. Riffe/
`Timothy W. Riffe (Reg. No. 43,881)
`Kevin Greene, (Reg. No. 46,031)
`FISH & RICHARDSON P.C.
`P.O. Box 1022
`Minneapolis, MN 55440-1022
`Tel: (202) 626-6447
`Fax: (202) 783-2331
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`Attorneys for Patent Owner
`Paice LLC & Abell Foundation, Inc.
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`13
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`CERTIFICATE OF SERVICE
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`Case IPR2014-00579
`Patent 7,104,347
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`Pursuant to 37 CFR §§ 42.6(e)(4)(i) et seq. and 42.105(b), the undersigned
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`certifies that on May 15, 2015, a complete and entire copy of this Patent Owner’s
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`Motion to Exclude was provided via email to the Petitioner by serving the
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`correspondence email addresses of record as follows:
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`Frank A. Angileri
`John Nemazi, John Rondini
`Brooks Kushman P.C.
`1000 Town Center
`Twenty-Second Floor
`Southfield, Michigan 48075
`Email: FPGP0101IPR3@brookskushman.com
`
`Lissi Mojica
`Kevin Greenleaf
`Dentons US LLP
`1530 Page Mill Road
`Suite 200
`Palo Alto, California 94304-11251
`Email: lissi.mojica@dentons.com
`Email: kevin.greenleaf@dentons.com
`Email: iptdocketchi@dentons.com
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`
`
`
`
`
`
`/Jessica K. Detko/
`
`Jessica K. Detko
`Fish & Richardson P.C.
`60 South Sixth Street, Suite 3200
`Minneapolis, MN 55402
`(612) 337-2516
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