UNITED STATES PATENT AND TRADEMARK OFFICE
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`______________________________
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`TOYOTA MOTOR CORPORATION
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`Petitioner
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`v.
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`AMERICAN VEHICULAR SCIENCES LLC
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`Patent Owner
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`
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`Patent No. 6,772,057
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`Issue Date: August 3, 2004
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`Title: VEHICLE MONITORING SYSTEMS USING IMAGE PROCESSING
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`
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`PATENT OWNER’S PRELIMINARY RESPONSE
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`Case No. IPR2015-00261
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`______________________________
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`TOYOTA MOTOR CORPORATION
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`Petitioner
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`
`
`v.
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`
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`AMERICAN VEHICULAR SCIENCES LLC
`
`Patent Owner
`
`
`
`Patent No. 6,772,057
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`Issue Date: August 3, 2004
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`Title: VEHICLE MONITORING SYSTEMS USING IMAGE PROCESSING
`
`
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`PATENT OWNER’S PRELIMINARY RESPONSE
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`Case No. IPR2015-00261
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`PATENT OWNER’S PRELIMINARY RESPONSE
`IPR2015-00261
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`
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`Toyota Motor Corporation’s (“Toyota’s”) Petition IPR2015-00261 should be
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`denied on its face, and not instituted for the following statutory estoppel reasons:
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`(1) The IPR cannot not be instituted because, prior to any institution
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`decision, maintaining the IPR will become statutorily barred under 35 U.S.C.
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`§315(e)(1). More than sixteen months ago, Toyota filed an earlier IPR petition on
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`the same patent. (See IPR2013-00419.) In that IPR, depositions were taken, all
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`substantive papers have been filed, and an oral argument was held. All that
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`remains in connection with Toyota’s earlier-filed petition (IPR2013-00419) is a
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`Final Written Decision. That final decision will issue by January 13, 2015.
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`Because a final decision will issue, Toyota cannot “maintain a proceeding before
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`the Office with respect to that claim or any ground that the petitioner raised or
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`reasonably could have raised during that inter partes review.” 35 U.S.C.
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`§315(e)(1) (emphasis added). Here, it is indisputable that each of the grounds that
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`Toyota raises in its new petition were grounds that it reasonably could have raised
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`in its earlier one. Toyota is merely raising an obviousness argument with respect
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`to the same prior art reference (Lemelson) that it raised in IPR2013-00419. The
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`only reason that Toyota did not raise the argument in that prior IPR is because
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`Toyota did not think of it until after AVS responded with its rebuttal arguments.
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`The statutory provision of §315(e) is intended to bar precisely what Toyota is
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`trying to do by virtue of its second IPR petition—get a second bite at the apple
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`PATENT OWNER’S PRELIMINARY RESPONSE
`IPR2015-00261
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`where it fears that it will lose its first IPR. It would also circumvent the
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`requirement of a “just, speedy, and inexpensive” resolution of Toyota’s first IPR.
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`(2) The IPR cannot not be instituted because, absent joinder with
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`IPR2014-00646, it is also statutorily barred by 35 U.S.C. §315(b). The present
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`IPR was filed more than one year after Toyota was served with a complaint in
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`district court litigation. However, Toyota cannot join IPR2014-00646, because
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`there will be no proceeding to join. The only parties to IPR2014-00646 (patent
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`owner American Vehicular Sciences and petitioner Mercedes-Benz USA, LLC)
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`have already settled and moved to terminate the IPR proceeding, rendering
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`Toyota’s motion to join moot. See, e.g., Google, Inc. et al v. Personalweb Tech. et
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`al, Case IPR2014-00977 at Paper 10 (P.T.A.B. 2014) (where the parties to the IPR
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`that Google sought to join settled after Google filed its motion to join, but before
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`the Board decided the motion, the Board found that “[g]iven that [the IPR] is no
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`longer pending, it cannot serve as a proceeding to which another proceeding may
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`be joined. As such, the termination of [the IPR] renders Google’s Motion for
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`Joinder moot.”) (emphasis added). This situation is identical to that in Google.
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`(3) Toyota’s attempt to get a second bite at the apple would circumvent
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`the statutory requirement for completing an IPR proceeding within one year of
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`institution. Toyota’s petition in IPR2013-00419 was filed on July 12, 2013 (within
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`one year of the July 26, 2012 service date of a co-pending lawsuit between Toyota
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`2
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`PATENT OWNER’S PRELIMINARY RESPONSE
`IPR2015-00261
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`and AVS). Here, in view of the settlement between Mercedes and AVS, if Toyota
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`is allowed to join IPR2014-00646, it would be the only petitioner, achieving the
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`same result as if Toyota simply filed a new IPR more than sixteen months after the
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`statutory bar date. Such a loop-hole would be contrary to Congressional intent.
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`(4)
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`Further and notwithstanding the foregoing, the Board has the
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`discretion to deny institution of an IPR petition to avoid gamesmanship and to
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`prevent a party from improperly seeking a “do-over” of a failed IPR. Toyota
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`should not be allowed to endlessly re-litigate the same patent, raising new
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`arguments only after seeing its initial arguments fail. See, e.g., Medtronic, Inc. et
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`al v. EndoTach, LLC, Case IPR2014-00695, Paper 18 (P.T.A.B. Sept. 25, 2014)
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`(denying institution; “This case represents a ‘second bite at the apple’ for
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`Petitioner, who has received the benefit of seeing our Decision to Institute in the
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`prior case involving the same parties and patent claims.”)
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`For these reasons, which are discussed in more detail below, the Board
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`should deny instituting review on Toyota’s second IPR on the same patent. Toyota
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`already had its chance to attack the ‘057 patent, and nothing in the statute or Rules
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`allows endless “do-overs.”
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`3
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`PATENT OWNER’S PRELIMINARY RESPONSE
`IPR2015-00261
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`1.
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`The Estoppel Provision of 35 U.S.C. §315(e) Bars Institution Here
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`Toyota’s petition in IPR2015-00261 must first and foremost be denied
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`because granting it would violate the estoppel provisions of 35 U.S.C. §315(e).
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`Importantly, Toyota already filed its own IPR petition (IPR2013-00419) on the
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`exact same patent over sixteen months ago. Over the next thirteen months, Toyota
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`and AVS filed responses, took depositions of experts, and conducted an oral
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`hearing before the Board. A Final Written Decision in that IPR will issue by
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`January 13, 2015.
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`The patent statute expressly provides that because a final decision in
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`IPR2013-00419 will issue, “[t]he petitioner in an inter partes review . . . that
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`results in a final written decision” (Toyota) cannot “maintain a proceeding before
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`the Office with respect to that claim or any ground that the petitioner raised or
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`reasonably could have raised during that inter partes review.” 35 U.S.C.
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`§315(e)(1) (emphasis added). Nothing in the statute or rules provides an exception
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`to this estoppel in cases of joinder. See, e.g., 35 U.S.C. § 316(a)(11) (permitting
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`only an “adjust[ment of] time periods,” not a relaxation of estoppel, “in the case of
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`joinder”). For relevant purposes here, the estoppel provision of §315(e) is
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`absolute.
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`Here, Toyota is trying to assert obviousness arguments that it easily could
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`have—but did not—raise in IPR2013-00419. Contrary to Toyota’s misguided plea
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`4
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`PATENT OWNER’S PRELIMINARY RESPONSE
`IPR2015-00261
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`that AVS or the Board somehow kept Toyota from raising certain obviousness
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`arguments, it was Toyota’s own decision to not raise those obviousness arguments
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`in its petition, and to rely only on alleged anticipation by Lemelson. It is wholly
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`irrelevant that Toyota did not think of making those obviousness arguments at the
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`time of its petition. Nor is it relevant that Toyota’s new obviousness arguments
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`were prompted by the persuasiveness of AVS’s arguments rebutting alleged
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`anticipation by Lemelson. Toyota easily could have made those obviousness
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`arguments in its petition, as they involved the same references that Toyota asserted
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`in its Petition (i.e., Toyota was clearly aware of the references and their
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`applicability). Only now, after six months of preliminary proceedings, and ten
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`months of trial in IPR2013-00419, and after seeing AVS’s rebuttal arguments, does
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`Toyota wish that it would have raised additional or different arguments in its
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`petition. But that is the whole point of the estoppel provision of 35 U.S.C. §315—
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`to prevent attempts like Toyota’s for a second bite at the apple on grounds that
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`“could have been raised.” See, e.g., 77 FR 48612 (“the estoppel provisions in 35
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`U.S.C. 315(e), as amended, and 35 U.S.C. 325(e) are to prevent abusive serial
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`challenges to patents”).
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`5
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`PATENT OWNER’S PRELIMINARY RESPONSE
`IPR2015-00261
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`2.
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`The Termination of IPR2014-00646 Will Make Toyota’s Instant
`IPR Barred By 35 U.S.C. §315(b)’s One Year Filing Deadline
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`The Board should also decline instituting the IPR because it will also be
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`barred pursuant to 35 U.S.C. §315(b). Absent joinder with IPR2014-00646,
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`Toyota’s petition will be untimely, as Toyota was served with a complaint in a
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`lawsuit well over a year before it filed the present petition. But Toyota cannot join
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`IPR2014-00646 for a simple reason—the parties to IPR2014-00646 have already
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`settled and moved to terminate the proceeding, leaving nothing for Toyota to join.
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`This is the exact scenario that was faced by the Board in Google, Inc., Case
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`IPR2014-00977. There, the Board denied Google’s request to join in part because
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`Google filed its motion to join late, but also because after Google moved to join,
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`the parties to the IPR settled and moved to terminate. See id.
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`In fact, the parties in Google, Inc., Case IPR2014-00977 settled several
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`months after Google filed its motion to join, as opposed to here, where AVS and
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`Mercedes were already in the process of negotiating a settlement before Toyota
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`filed its joinder motion, and finalized the settlement mere days after Toyota’s
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`motion. The timing in Google, Inc., Case IPR2014-00977 was as follows:
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` 4/15/14 – Rackspace’s IPR petition against PersonalWeb patent granted.
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` 6/18/14 - Google filed its motion to Join (late).
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` 10/16/14 - Rackspace and PersonalWeb settled and requested termination.
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`6
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`PATENT OWNER’S PRELIMINARY RESPONSE
`IPR2015-00261
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` 10/30/14 – the Board issued its decision denying the motion to join.
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`In denying Google’s Motion for Joinder, the Board stated that “[g]iven that
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`IPR2014-00059 is no longer pending, it cannot serve as a proceeding to which
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`another proceeding may be joined. As such, termination of IPR2014-00059
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`renders Google’s Motion for Joinder moot.” Google, Inc., Case IPR2014-00977 at
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`Paper 10. For the same reasons, the Board should deny instituting Toyota’s second
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`IPR on the same patent. The exact same facts are present as in the Google
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`decision. Instituting review in this IPR would be 180 degrees in conflict with the
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`Google decision.
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`3.
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`Instituting the Present IPR Would Violate 35 U.S.C. §316(a)(11)
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`The patent statute (35 U.S.C. §316(a)(11)) provides that final determination
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`in an IPR must be issued not later than one year after the date of institution. 35
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`U.S.C. §315(a)(11). Here, due to the settlement between AVS and Mercedes,
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`Toyota would be the only petitioner, effectively having obtained an expansion of
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`its prior IPR. To institute review on Toyota’s newest IPR petition would
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`effectively gut all of the deadlines set in the statute. See 35 U.S.C. § 316(b) (“In
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`prescribing regulations under this section, the Director shall consider the effect of
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`any such regulation on the economy, the integrity of the patent system, the efficient
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`administration of the Office, and the ability of the Office to timely complete
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`proceedings instituted under this chapter.”).
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`7
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`PATENT OWNER’S PRELIMINARY RESPONSE
`IPR2015-00261
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`The Board has previously indicated that it will not provide petitioners with a
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`second bite at the apple, as Toyota seeks. See, e.g., Medtronic, Inc. et al v.
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`EndoTach, LLC, Case IPR2014-00695, Paper 18 (P.T.A.B. Sept. 25, 2014)
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`(“[W]hen a § 315(b) bar would apply absent joinder, we hesitate to allow a
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`petitioner a second bite one month after institution in a first case, at the expense of
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`scheduling constraints for everyone, as well as additional costs (and potential
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`prejudice) to Patent Owner, absent a good reason for doing so. . . . Thus, we do not
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`perceive that there is no discernable prejudice to Patent Owner if we grant the
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`Joinder Motion.”); Samsung Electronics Co. Ltd. v. Arendi S.A.R.L., Case
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`IPR2014-01142, Paper 11 (P.T.A.B. Oct. 2, 2014) (“In view of the facts and
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`circumstances of this case, Petitioner, as movant, has not met its burden to show
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`why joinder is appropriate, consistent with the goal of securing the just, speedy,
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`and inexpensive resolution of every proceeding.”).
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`4.
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`The Board Has Discretion To Deny Instituting a Review That
`Would Improperly Give a Petitioner A Second Bite At The Apple
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`Finally, and notwithstanding the foregoing, the Board should exercise its
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`discretion to deny review to avoid abuse and harassment. The decision to institute
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`is discretionary when there are other proceedings on the same patent. See 35
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`U.S.C. § 315(d). When exercising its discretion, patent trial regulations “shall be
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`construed to secure the just, speedy, and inexpensive resolution of every
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`8
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`PATENT OWNER’S PRELIMINARY RESPONSE
`IPR2015-00261
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`proceeding.” See 37 C.F.R. § 42.1(b). The Patent Office has repeatedly indicated
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`that it “seeks to protect patent owners from harassment via successive petitions by
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`the same or related parties, to prevent parties from having a ‘second bite at the
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`apple,’ and to protect the integrity of both the USPTO and Federal Courts by
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`assuring that all issues are promptly raised and vetted.” 77 Fed. Reg. 48756.
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`Here, granting Toyota’s new IPR petition would have one and only one
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`result—giving Toyota a second bite at the apple, to raise new arguments it failed to
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`raise in its earlier petition, at the expense of AVS, Honda and the Board. If Toyota
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`is joined to IPR2014-00646, it would be the only petitioner. It would be in exactly
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`the same place as if the Board had allowed Toyota to add belated obviousness
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`arguments to IPR2013-00424 that were not in its petition (something the Board
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`expressly rejected), or if the Board allowed Toyota to file another new, statutorily-
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`late IPR petition. If nothing else, the Board should exercise its discretion to
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`prevent Toyota from opening a loophole in the IPR statute and rules that would
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`allow it to do what numerous statutory provisions prohibit.
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`Accordingly, for the above reasons, the Board should deny instituting review
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`on Toyota’s second IPR petition on the same patent. Toyota’s new petition is
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`statutorily barred and an improper attempt to obtain an extension of its prior IPR.
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`AVS reserves it right to submit a Patent Owner Response on the merits of
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`Toyota’s assertions of unpatentability pursuant to 37 CFR §42.120.
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`9
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`PATENT OWNER’S PRELIMINARY RESPONSE
`IPR2015-00261
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`Respectfully submitted,
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`/Thomas J. Wimbiscus/
`Thomas J. Wimbiscus
`Registration No. 36,059
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`DATE: December 15, 2014
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`MCANDREWS HELD & MALLOY
`500 West Madison St., 34th Floor
`Chicago, IL 60661
`Telephone: (312) 775-8000
`Facsimile: (312) 775-8100
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`CUSTOMER NUMBER: 23446
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`10
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`PATENT OWNER’S PRELIMINARY RESPONSE
`IPR2015-00261
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`CERTIFICATE OF SERVICE
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`I hereby certify that the Patent Owner’s Preliminary Response in connection
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`with Inter Partes Review Case IPR2015-00261 was served on this 15th day of
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`December, 2014 by electronic mail to the following:
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`Lead Counsel
`Matt Berkowitz
`(Reg. No. 57,215)
`mberkowitz@kenyon.com
`ptab@kenyon.com
`Kenyon & Kenyon LLP
`One Broadway
`New York, NY 10004
`Tel: 212-425-7200
`Fax: 212-425-5288
`
`
`Back-up Counsel
`Thomas R. Makin
`(pro hac vice to be requested upon authorization)
`tmakin@kenyon.com
`Kenyon & Kenyon LLP
`One Broadway
`New York, NY 10004
`Tel: 212-425-7200
`Fax: 212-425-5288
`
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`/ Thomas J. Wimbiscus /
`Thomas J. Wimbiscus
`Registration No. 36,059
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`MCANDREWS HELD & MALLOY
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`Telephone: 312-775-8000
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`Facsimile: 312-775-8100
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`CUSTOMER NUMBER: 23446
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`Date: December 15, 2014
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