UNITED STATES PATENT AND TRADEMARK OFFICE
`
`––––––––––––––––––
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`––––––––––––––––––
`
`THE MANGROVE PARTNERS MASTER FUND, LTD., APPLE INC., and
`BLACK SWAMP IP, LLC,
`Petitioners,
`
`v.
`
`VIRNETX INC.,
`Patent Owner.
`
`––––––––––––––––––
`
`Case No. IPR2015-010471
`U.S. Patent No. 7,490,151
`
`––––––––––––––––––
`
`PETITIONERS’ MOTION TO EXCLUDE
`
`
`
`1 Apple Inc. and Black Swamp IP, LLC, who filed petitions in IPR2016-00063 and
`IPR2016-00167, respectively, have been joined as Petitioners in the instant
`proceeding.
`
`
`
`
`––––––––––––––––––
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`––––––––––––––––––
`
`THE MANGROVE PARTNERS MASTER FUND, LTD., APPLE INC., and
`BLACK SWAMP IP, LLC,
`Petitioners,
`
`v.
`
`VIRNETX INC.,
`Patent Owner.
`
`––––––––––––––––––
`
`Case No. IPR2015-010471
`U.S. Patent No. 7,490,151
`
`––––––––––––––––––
`
`PETITIONERS’ MOTION TO EXCLUDE
`
`
`
`1 Apple Inc. and Black Swamp IP, LLC, who filed petitions in IPR2016-00063 and
`IPR2016-00167, respectively, have been joined as Petitioners in the instant
`proceeding.
`
`
`
`
`IPR2015-01047
`
`I.
`
`Introduction
`
`Petitioners’ Motion to Exclude
`
`Petitioners The Mangrove Master Fund, Ltd., Apple Inc., and Black Swamp
`
`IP, LLC (“Petitioners”) hereby move to exclude Exhibit 2050 under 37 C.F.R.
`
`§§ 42.62, 42.64. Petitioners timely objected to Exhibit 2050 for containing
`
`inadmissible hearsay and unauthenticated attachments. Paper 50. The Board
`
`should grant this motion and exclude the exhibit in its entirety.
`
`II. Argument
`
`A. Exhibit 2050 Is Inadmissible.
`
`Exhibit 2050 is a Declaration of Dr. Robert Dunham Short III (the “Short
`
`Declaration”), a named inventor, that was prepared and submitted in an inter
`
`partes reexamination proceeding of the ’151 patent. Ex. 2050 at Face, ¶ 1; see
`
`Paper 52. The Short Declaration is 6 pages long and includes 134 pages of
`
`attachments. Patent Owner relies on statements in the Declaration and its
`
`attachments to argue that secondary considerations exist that support a finding of
`
`non-obviousness. See Resp. at 29-36 (citing Ex. 2050). Exhibit 2050 should be
`
`excluded because it contains both inadmissible hearsay not subject to an exception
`
`and unauthenticated attachments.
`
`1.
`
`Exhibit 2050 Contains Inadmissible Hearsay Not Subject to An
`Exception.
`
`The statements relied upon by Patent Owner in the Short Declaration and its
`
`attachments are hearsay because they were not made while testifying at the current
`
`1
`
`
`
`IPR2015-01047
`
`Petitioners’ Motion to Exclude
`
`trial or hearing, and Patent Owner offers them in evidence to prove the truth of the
`
`matter asserted. Fed. R. Evid. 801(c). First, Patent Owner confirmed that the
`
`Short Declaration was not prepared for this proceeding, and instead was
`
`“submitted nearly four years ago in an [inter partes] reexamination.” Ex. 2060 at
`
`11:21-25; Paper 52. Second, Patent Owner relies on Exhibit 2050 for the truth of
`
`statements made in the Short Declaration and its attachments to argue that putative
`
`secondary considerations exist to show non-obviousness. See Resp. at 29-36
`
`(citing Ex. 2050 at ¶¶ 3-12, 15, 16, and pp. 10, 27-29, 32, 72, 85-86, 91, 123, 126-
`
`29, 131-32, 136-37). Petitioners requested that Patent Owner provide Dr. Short for
`
`cross-examination to test these statements, but Patent Owner refused. Paper 52;
`
`Ex. 2050 at 12:18-22. Exhibit 2050, as relied on by Patent Owner, is thus
`
`inadmissible hearsay. Fed. R. Evid. 801(c), 802.
`
`Neither the Short Declaration nor any of its attachments are subject to any
`
`exceptions to the rules against hearsay enumerated in the Federal Rules of
`
`Evidence, including the residual exception. Fed. R. Evid. 803, 804, 807. For
`
`example, the Short Declaration consists of unsupported and conclusory statements
`
`by a plainly interested party—one of the inventors of the ’151 patent, see Ex. 1001
`
`at 1 (inventors), and a current employee of Patent Owner, see https://
`
`www.virnetx.com/about/executive-management/. These statements must be
`
`disregarded as untrustworthy not only because of the obvious bias, but also
`
`2
`
`
`
`IPR2015-01047
`
`Petitioners’ Motion to Exclude
`
`because the statements lack any corroboration sufficient to give the statements
`
`“equivalent circumstantial guarantees of trustworthiness.” Fed. R. Evid. 807
`
`(a)(1). In fact, the vast majority of the statements in Dr. Short’s declaration—
`
`related to, for example, “long-felt need” (Ex. 2005 at ¶¶ 2-9), “failure of others”
`
`(id. at ¶¶10-11), “commercial success” (id. at ¶12), “unexpected results” (id. at
`
`¶¶13-15), and “industry praise” (id. at ¶16)—are without citation to any supporting
`
`evidence at all. And, because Patent Owner refused to make Dr. Short available
`
`for cross-examination, Petitioners were not provided the opportunity to test the
`
`trustworthiness of the statements that Patent Owner now relies on in this
`
`proceeding as direct testimony. Davis v. Alaska, 415 U.S. 308, 316 (1974)
`
`(“Cross-examination is the principal means by which the believability of a witness
`
`and the truth of his testimony are tested.”). Accordingly, because Exhibit 2050 is
`
`inadmissible hearsay not subject to any exception, see Fed. R. Evid. 803, 804, 807,
`
`it must be excluded in its entirety.
`
`2.
`
`Exhibit 2050 Contains Unauthenticated Attachments that
`Should Be Excluded.
`
`Patent Owner provided 134 pages of attachments in Exhibit 2050. These
`
`pages consist of a variety of documents, none of which are self-authenticating.
`
`Patent Owner has also provided no evidence demonstrating these documents are
`
`what Patent Owner says they are, and Dr. Short does not authenticate any of them
`
`in his declaration. See Ex. 2005 at ¶¶ 2-16. Thus, because the attachments to Dr.
`3
`
`
`
`IPR2015-01047
`
`Petitioners’ Motion to Exclude
`
`Short’s declaration have not been authenticated, see Fed. R. Evid. 901-903, they
`
`should be excluded, see id. 901(a).
`
`III. Conclusion
`
`For these reasons, the Board should exclude Exhibit 2050 in its entirety.
`
`
`
`
`
`Dated: May 27, 2016
`
`/Jeffrey P. Kushan/
`Jeffrey P. Kushan
`Reg. No. 43,401
`Sidley Austin LLP
`Attorney for Petitioner Apple
`
`/Thomas H. Martin/
`Thomas H. Martin
`Reg. No. 34,383
`MARTIN & FERRARO, LLP
`Attorney for Petitioner Black Swamp
`
`Respectfully Submitted,
`
`/Abraham Kasdan/
`Abraham Kasdan
`Reg. No. 32, 997
`Wiggin & Dana LLP
`
`James T. Bailey
`Reg. No. 44,518
`The Law Office of James. T. Bailey
`Attorneys for Petitioner Mangrove
`
`4
`
`
`
`IPR2015-01047
`
`Petitioners’ Motion to Exclude
`
`CERTIFICATE OF SERVICE
`
`Pursuant to 37 C.F.R. § 42.6(e), I hereby certify that on this 27th day of
`
`May, 2016, I caused to be served a true and correct copy of the foregoing and any
`
`accompanying exhibits by e-mail on the following counsel:
`
`Joseph E. Palys
`josephpalys@paulhastings.com
`
`Naveen Modi
`naveenmodi@paulhastings.com
`
`
`
`
`Dated: May 27, 2016
`
`/Jeffrey P. Kushan/
`Jeffrey P. Kushan
`Reg. No. 43,401
`Sidley Austin LLP
`Attorney for Petitioner Apple
`
`/Thomas H. Martin/
`Thomas H. Martin
`Reg. No. 34,383
`MARTIN & FERRARO, LLP
`Attorney for Petitioner Black Swamp
`
`
`Respectfully Submitted,
`
`/Abraham Kasdan/
`Abraham Kasdan
`Reg. No. 32, 997
`Wiggin & Dana LLP
`
`James T. Bailey
`Reg. No. 44,518
`The Law Office of James. T. Bailey
`Attorneys for Petitioner Mangrove
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