`By:
`/Richard F. Guinta/
`
`Richard F. Giunta
`Elisabeth H. Hunt
`Randy J. Pritzker
`WOLF, GREENFIELD & SACKS, P.C.
`600 Atlantic Avenue
`Boston, MA 02210
`Tel: (617) 646-8000
`Fax: (617) 646-8646
`RGiunta-PTAB@wolfgreenfield.com
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`UNITED STATES PATENT AND TRADEMARK OFFICE
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`_____________
`RPX Corporation
`Petitioner
`v.
`Applications in Internet Time, LLC
`Patent Owner
`_____________
`
`Case IPR2015-01750
`Patent 8,484,111 B2
`
`Case IPR2015-01751
`Case IPR2015-01752
`Patent 7,356,482 B21
`
`_____________
`PETITIONER’S OPPOSITION TO PATENT OWNER’S
`MOTION FOR ADDITIONAL DISCOVERY
`
`
`1 The word-for-word identical paper is filed in each proceeding identified in the
`heading.
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`Paper No. __
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`
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`TABLE OF CONTENTS
`
`TABLE OF CONTENTS
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`AIT FAILS TO MEET THE FIRST GARMIN FACTOR ............................. ..1
`
`A. AIT Misstates the RPI Test ....................................................................... ..2
`
`B. No Evidence Tends To Show That Salesforce Is an RPI .......................... ..3
`
`1. AIT Mischaracterizes RPX’s Business Model .................................... ..4
`
`I. AIT FAILS TO MEET THE FIRST GARMIN FACTOR ............................... 1
`A. AIT Misstates the RPI Test ......................................................................... 2
`B. No Evidence Tends To Show That Salesforce Is an RPI ............................ 3
`1. AIT Mischaracterizes RPX’s Business Model ...................................... 4
`2. AIT Mischaracterizes RPX’s History In Filing IPRs ............................ 6
`2. AIT Mischaracterizes RPX’s History In Filing IPRs .......................... ..6
`3. AIT’s Remaining “Evidence” Is Innocuous .......................................... 8
`3. AIT’s Remaining “Evidence” Is Innocuous ........................................ ..8
`C. Conclusion - Discovery Should Be Denied Outright .................................. 9
`C. Conclusion — Discovery Should Be Denied Outright ................................ ..9
`II. ANY DISCOVERY GRANTED SHOULD BE MORE NARROWLY
`TAILORED PURSUANT TO GARMIN FACTORS 1-5 ................................ 9
`
`ANY DISCOVERY GRANTED SHOULD BE MORE NARROWLY
`
`TAILORED PURSUANT TO GARMIN FACTORS 1-5 .............................. ..9
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`i
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`TABLE OF AUTHORITIES
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`
`
`CASES
`Aruze Gaming Macau, Ltd. v. MGT Gaming, Inc.,
`Case IPR2014-01288 (PTAB Feb. 20, 2015) (Paper 13) ....................................... 7
`
`Butamax Advanced Biofuels LLC v. Gevo, Inc.,
`Case IPR2013-00214 (PTAB Sept. 30, 2013) (Paper 11) ...................................... 8
`
`Farmwald et al. v. ParkerVision, Inc.,
`Case IPR2014-00946 (PTAB Feb. 20, 2015) (Paper 25) ...................................7, 9
`
`Garmin International, Inc. v. Cuozzo Speed Technologies LLC,
`Case IPR2012-00001 (PTAB Mar. 5, 2013) (Paper 26) .............................. passim
`
`Globaltel*Link Corporation v. Securus Technoliogies, Inc.,
`Case IPR2015-01220 (PTAB Sept. 22, 2015) (Paper 18) ...................................... 8
`
`RPX Corporation et al. v. Red Anvil LLC,
`Case IPR2016-00003 (PTAB Oct. 1, 2015) (Paper 6) ........................................... 7
`
`RPX Corporation v. Macrosolve, Inc.,
`Case IPR2014-00140 (PTAB May 16, 2014) (Paper 9)......................................... 6
`
`RPX Corporation. v. VirnetX, Inc.,
`Case IPR2014-00171 (PTAB Jun. 5, 2014) (Paper 49) .....................................7, 8
`
`Samsung Display Co. Ltd. v. The Gold Charm Limited,
`Case IPR2015-01416 (PTAB Sept. 4, 2015) (Paper 7) ........................................ 3
`
`Sierra Wireless America, Inc. et al. v. M2M Solutions, LLC,
`Case IPR2015-01823 (PTAB August 26, 2015) (Paper 1) .................................... 7
`
`TRW Automotive U.S. LLC v. Magna Electronics Inc.,
`Case IPR2015-00950 (PTAB Sept. 17, 2015) (Paper No. 8) .............................6, 9
`
`U.S. Department of Homeland Security v. Larry Golden, Case
`IPR2014-00714 (PTAB Oct. 1, 2015) (Paper 35) .................................................. 3
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`ii
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`Unified Patents Inc. v. Hall Data Sync Technoogies, LLC,
`Case IPR2015-00874 (PTAB Sept. 17, 2015) (Paper 11) ...................................... 7
`
`Unified Patents, Inc. v. Dragon Intellectual Property, LLC,
`Case IPR2014-01252 (PTAB Feb. 12, 2015) (Paper 37) ...................................7, 8
`
`RULES
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`77 F. Reg. at 48759 ................................................................................................2, 6
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`iii
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`I.
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`AIT FAILS TO MEET THE FIRST GARMIN FACTOR
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`AIT’s discovery motion should be denied. RPX has already told AIT that
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`Salesforce is entirely uninvolved in the IPRs and offered to produce any and all
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`evidence relating to control, ability to control, direction of or funding of the IPRs
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`by Salesforce - but none exists. Despite this and the absence of any evidence
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`showing beyond speculation that something useful will be found as required by
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`Garmin, AIT futilely pushes forward with expansive discovery requests that are
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`not properly tailored to meet the Garmin factors.
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`The mere possibility or allegation that something useful will be found is not
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`enough. AIT “should already be in possession of evidence tending to show beyond
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`speculation that in fact something useful will be uncovered.” Garmin, IPR2012-
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`00001, Paper 26 at 6.2 “Useful” means “favorable in substantive value to a
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`contention of the party moving for discovery.” Id. at 7. Thus, to meet the first
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`Garmin factor, AIT must possess evidence demonstrating that something will be
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`found that is favorable to its assertion that Salesforce is an unnamed RPI.
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`AIT does not specify what the “something useful” is that allegedly exists, let
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`alone present evidence of its existence. AIT seeks wide ranging discovery in the
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`hope that something useful will be uncovered. This type of fishing expedition is
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`prohibited by Garmin and routinely denied by the Board.
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`2 Full citations to all cited Board decisions are provided in the Table of Authorities.
`1
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`AIT repeatedly states that it “seems” that Salesforce is an RPI and that AIT
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`“expects” and “believes” that to be the case. Patent Owner’s Motion For
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`Additional Discovery (“Mot.”) at 1, 3-5 and 8. AIT’s beliefs are not evidence.
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`AIT admits that it is only speculating that Salesforce may be an RPI and seeks
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`discovery to substantiate that speculation. Mot. at 5 (“AIT requests discovery that
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`is needed … to determine whether” Salesforce is an unnamed RPI). This
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`admission is fatal to AIT’s discovery request, as discovery is not available to a
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`party that “speculates” about an issue and “requests information to substantiate that
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`speculation. ” Garmin, Paper 26 at 10.
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`A. AIT Misstates the RPI Test
`Information AIT seeks is not “useful” unless it is relates to factors
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`considered in an RPI analysis and “favorable” to AIT’s contention that Salesforce
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`is an RPI. Id. at 7. AIT cites the Trial Practice Guide (“TPG”) but ignores the
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`facts the Board most commonly considers in determining RPI – (1) “whether the
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`non-party exercised or could have exercised control over a party’s participation in
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`a proceeding” and (2) “whether the non-party funded the proceeding.” 77
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`Fed. Reg. at 48759-48760. An RPI is a party that “desires review,” which the TPG
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`defines as the petitioner and/or a party “at whose behest the petition has been
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`filed.” TPG at 48,759. As discussed below, AIT points to no evidence tending to
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`show that Salesforce controlled, could have controlled or funded the IPRs, or that
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`2
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`RPX filed the petitions at the “behest” (i.e., order or command) of Salesforce.
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`To the extent AIT suggests that Salesforce may be an RPI even if it did not
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`fund, control or direct the IPRs and did not have RPX file them at its behest, that is
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`not the law. Samsung, IPR 2015-01416, Paper 7 at 4-5 (denying RPI discovery
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`because patent owner showed only that unnamed parties “had some incentive to
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`have a petition filed” but provided no evidence that they were involved in, directed
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`or controlled the IPRs); Homeland Security, IPR 2014-00714, Paper 35 at 11
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`(unnamed parties sued on the patent and having relationships with the petitioner in
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`unrelated endeavors were not RPIs without “proof of control or involvement by
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`these [unnamed] parties in this proceeding”).
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`Finally, AIT’s reliance on apparent authority is misplaced given that the
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`facts do not fit - RPX never held itself out as authorized to act for Salesforce in the
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`IPRs (quite the opposite) - and AIT fails to explain how the doctrine is relevant to
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`a proper RPI analysis or cite any authority supporting AIT’s assertion that it is.
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`B. No Evidence Tends To Show That Salesforce Is an RPI
`AIT admits that it is speculating about “whether” RPX filed the IPRs as a
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`proxy for Salesforce or for some other reason. Mot. at 5. RPX will not (and need
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`not under Garmin factor 2) explain its legal strategy for filing these particular IPR
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`petitions. It suffices to point out that AIT’s assertion that the only conclusion to be
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`drawn from the cited facts is that RPX is acting as an agent for Salesforce is flatly
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`3
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`contradicted by the very evidence AIT relies on. This evidence does not meet
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`Garmin’s requirement to show beyond AIT’s speculation that discovery will
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`produce anything useful in showing that Salesforce is an RPI.
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`AIT Mischaracterizes RPX’s Business Model
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`1.
`The evidence refutes AIT’s assertion that the only conclusion to be drawn
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`from RPX’s business model is that RPX filed the IPR petitions as an agent of
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`Salesforce. AIT cobbles together disparate quotes selected out of context from
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`three public documents in misrepresenting that the “essence” of RPX’s business is
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`to serve as an extension of a client’s in-house legal team by representing clients
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`accused of infringement and acting as their proxy to clear liability by attacking the
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`asserted patents. Mot. at 1.
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`RPX offers solutions to companies to mitigate and manage patent risk and
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`expense. Ex. 2008 at 3. “The core of [RPX’s] solution is defensive patent
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`aggregation” in which RPX acquires patents that are or may be asserted against
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`current or prospective clients and licenses them to its clients. Id. Serving as an
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`extension of a client’s in-house legal team does not refer to attacking patents, but
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`to RPX sharing insight about the patent market with the “client’s in-house legal
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`team to better inform its long-term IP strategy.” Ex. 2006. For an annual
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`subscription fee, the benefits RPX clients receive include: reduced risk of patent
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`litigation because RPX buys and licenses patents that may otherwise be asserted
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`4
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`against clients; a cost-effective license based upon the client’s historical financial
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`results; and reduced costs for managing patent risk because clients supplement
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`their internal resources with RPX’s knowledge and experience. Ex. 2008 at 4.
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`The cited materials’ reference to RPX “clear[ing]” liability for its clients
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`does not refer to attacking patents, but to RPX acquiring “a license to the litigated
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`patent and selectively clear[ing] our clients from the suit.” Ex. 2007. The
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`reference to “challenging patents” is described as a “complementary solution”. Ex.
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`2008 at 4. AIT cannot meet Garmin’s requirement to provide evidence tending to
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`show that Salesforce engaged RPX to attack the AIT patents because it did not.
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`The reference to RPX acting as an agent or proxy for its clients relates to
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`special circumstances (e.g., a patent relevant to few RPX clients) called
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`“syndicated acquisition” where RPX may act “as an agent to acquire patent rights
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`… on behalf of clients who are paying for such rights separately from their
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`subscription arrangements.” Id. at 26, 53. AIT’s attempt to tie this entirely
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`unrelated agent/proxy relationship to challenging patents (Mot. at 1) is misleading.
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`The cited RPX materials reveal that RPX is a business with many different
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`aspects that provide incentives for RPX to file IPRs to serve its own interests,
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`including supporting its patent rights acquisition program which had already
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`deployed over $500 million of RPX’s capital by the end of 2013. Ex. 2008 at 5. In
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`RPX’s negotiations for patent rights, RPX’s demonstrated history of filing high
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`5
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`quality IPRs as an alternative way to remove patents from the market may provide
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`leverage in reaching agreement on valuation with owners of patents of
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`questionable validity. RPX also offers NPE insurance as a complementary service.
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`Id. at 4. As an insurer, RPX may have an independent interest in proactively
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`reducing its potential exposure from insured clients being sued on invalid patents.
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`The overly broad patents at issue here are clearly invalid and owned by an
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`NPE that has shown a willingness to assert them against the industry. It is unlikely
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`that only Salesforce will be forced to defend itself if these invalid patents are left
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`unchallenged. The very evidence AIT relies upon illustrates numerous reasons
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`why RPX might further its own independent interests by challenging such patents.
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`AIT Mischaracterizes RPX’s History In Filing IPRs
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`2.
`RPX has filed 19 petitions against 8 different patent owners and expects to
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`file many more. When RPX files a petition alone, its clients are not RPIs. RPX v.
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`Macrosolve, IPR 2014-00140 (Paper 9 at 3-4) (“Mere membership in petitioner
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`RPX Corporation, however, does not demonstrate the requisite control over
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`petitioner by the alleged unnamed real parties-in-interest.”). This is consistent
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`with (1) the TPG’s explanation of how RPI is handled for trade associations (TPG
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`at 48,760) ; (2) Board decisions deemphasizing any relationships between parties
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`unrelated to the IPR (TRW, IPR 2015-00950, Paper No. 8 at 6 (“The key inquiry is
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`‘the relationship between a party and a proceeding” rather than “the relationship
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`6
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`between parties” (emphasis in original)); and (3) the Board’s handing of petitions
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`filed by Unified Patents where its members are not RPIs absent evidence of
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`specific involvement in the IPR (Unified v. Dragon, IPR 2014-01252, Paper 37 at
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`12-13; Unified v. Hall, IPR 2015-00874, Paper 11 at 3-4).
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`When RPX works with another party to file an IPR petition, the other party
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`is named an RPI. See IPR 2014-00946, IPR 2015-01823 and IPR 2016-00003.
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` Contrary to AIT’s misrepresentations, the Board in ParkerVision did not
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`find that RPX was acting as a proxy for a concealed RPI, and no “procedural
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`posture” prevented the Board from addressing RPI. Mot. at 2-3. The patent owner
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`response stated that “Consistent with an e-mail from the Board … depending on
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`the results of the additional discovery … patent owner will seek Board permission”
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`to brief RPI. IPR 2014-00946, Paper 27 at 1-2. The Board specifically invited the
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`patent owner to revisit the RPI issue if the discovery proved fruitful, but the patent
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`owner did not because, as RPX had represented, discovery revealed no other RPI.
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`VirnetX, IPR 2014-00171 (Paper 49), and the related IPRs (collectively
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`“VirnetX”) was an early case on previously unsettled RPI law and was an outlier.
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`None of RPX’s other filings has been found to involve an unnamed RPI. The facts
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`the Board focused on in VirnetX are not present here. There, the Board found that
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`Apple paid RPX to file IPRs as part of a “newly created program.” VirnetX at 4.
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`Salesforce is not part of any such program and AIT cites no evidence that it is.
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`7
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`The Board also found that RPX used “Apple’s expert” and “Apple’s law firm” to
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`file a petition with “substantially identical” grounds to Apple’s. Id. at 6-7. Here,
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`Salesforce’s previously filed CBMs used different counsel, a different expert and
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`different prior art grounds. VirnetX simply does not apply.
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`AIT’s Remaining “Evidence” Is Innocuous
`3.
`That RPX has not been sued by AIT (Mot. at 6) is “unremarkable.” Unified
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`v. Dragon, Paper 37 at 13. Being sued is not a requirement for IPR.
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`The fact that a single board member, one of 11 for Salesforce (Ex. 2010) and
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`6 for RPX (Ex. 2009), overlaps between public companies is also unremarkable.
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`Mr. Robertson has had significant involvement in over 500 technology companies
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`(Ex. 2009) and AIT has no evidence that Mr. Robertson is even aware of the filing
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`of these IPRs, let alone that he caused RPX to file them on Salesforce’s behalf.
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`Absent evidence of involvement in or directing the filing of the petition, a common
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`director is not evidence of any “useful” discoverable information. Global, IPR
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`2015-01220, Paper 18 at 9; Butamax, IPR 2013-00214, Paper 11 at 4.
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`The fact that the CEOs of Salesforce and RPX belong, along with more than
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`30 others (Ex. 2012), to a common organization, and that the companies are
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`housed in different proximate buildings, makes it no more “natural to expect” that
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`they have engaged in “covert communications” (Mot. at 7-8) than any other two
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`parties with access to a phone. AIT’s “evidence” of ways in which parties could
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`8
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`communicate is not evidence that they did so.
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`C. Conclusion - Discovery Should Be Denied Outright
`Salesforce does not fund, control or have the ability to control these IPRs.
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`AIT has no evidence of any involvement by Salesforce, and its motion admits as
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`much - AIT needs discovery “to determine whether” Salesforce is an RPI. Mot. at
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`5. AIT’s discovery requests are based entirely on erroneous speculation
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`unsupported by the evidence Garmin requires. The request should be denied.
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`II. ANY DISCOVERY GRANTED SHOULD BE MORE NARROWLY
`TAILORED PURSUANT TO GARMIN FACTORS 1-5
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`Any granted discovery must comply with Garmin factors 1-5 (“F1-F5”) and
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`be narrowly tailored to “useful” information evaluated in determining RPI –
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`control, ability to control, funding and the relationship of Salesforce to the IPR
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`proceedings. AIT’s proposed requests (“Req1-Req10”) are not at all so tailored.
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`Req1 is overbroad in seeking aspects of a relationship that are unrelated to
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`the proceedings and therefore not “useful” (F1). TRW, Paper No. 8 at 6.
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`Req2 seeks irrelevant information about billings unrelated to the
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`proceedings. Any IPR billings are covered by Req7; no others are “useful” (F1).
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`Req3 is overbroad and burdensome (F5) in seeking communications relating
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`to litigation to which RPX is not a party. Such information was excluded from
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`discovery in ParkerVision. IPR2014-00946, Paper 25 at 7. Req4 likewise is
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`overbroad. Communications relating to the IPRs, excluding privileged
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`9
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`communications, are covered by other requests and nothing else is “useful” (F1).
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`Req5 – AIT does not explain why communications with other third parties
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`are “useful” in making Salesforce an RPI, and has no evidence that any exist (F1).
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`Req6 improperly seeks the strategic reasons why RPX filed these petitions
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`(F2). AIT cites no authority establishing that a reason or motive for filing an IPR
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`petition is “useful” in determining RPI (F1), and strategic reasons for filing are
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`privileged and “litigation positions” not discoverable under F2, as Garmin is clear
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`that “litigation” refers to the IPR proceeding itself. Garmin at 6 and 13.
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`Req8 is not directed to “useful” information as explained above (F1), AIT
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`presents no evidence that any such documents exist (F1), and the request is overly
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`burdensome on an outside director uninvolved in these proceedings (F5).
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` Req9 - the relationship between another third party to a different proceeding
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`is not “useful” to establish that Salesforce is an RPI in this proceeding (F1).
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`Req10’s speculation that RPX must “shield its clients” from being an RPI is
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`erroneous and AIT cites no evidence that such documents exist (F1).
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`Attached are revised discovery requests, and a redline of AIT’s requests, that
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`are more appropriately tailored. The revised requests would reveal any obligation
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`of RPX to file the IPRs for Salesforce and any communications between RPX and
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`Salesforce relating to the IPRs (which would address control of the IPRs), and any
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`documents relating to funding by Salesforce of the IPRs. Nothing else is “useful.”
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`10
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`CERTIFICATE OF SERVICE UNDER 37 C.F.R. § 42.6 (E)(4)
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`It is hereby certified that on this 9th day of October, 2015, a copy of the
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`foregoing document was served via electronic mail, as previously consented to by
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`Patent Owner upon the following counsel of record:
`
`Steven C. Sereboff (Reg. No. 37,035)
`M. Kala Sarvaiya (Reg. No. 58,912)
`SoCal IP Law Group LLP
`310 N. Westlake Boulevard, Suite 120
`Westlake Village, CA 91362
`uspto@socalip.com
`
`
`
`/Richard F. Giunta/
`Richard F. Giunta
`
`
`
`Date: October 9, 2015
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`11