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`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________________
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________________
`
`
`RPX Corporation,
`Petitioner
`
`v.
`Applications In Internet Time LLC,
`Patent Owner.
`_____________________
`IPR2015-01750
`Patent 8,484,111 B2
`
`IPR2015-01751
`IPR2015-01752
`Patent 7,356,482 B21
`
`
`PATENT OWNER’S RESPONSE
`TO PETITIONER’S REQUEST FOR REHEARING
`OF FINAL DECISION ON REMAND TERMINATING INSTITUTION
`
`
`
`1 This paper addresses issues common to all three cases. The word-for-word identical
`paper is filed in each proceeding identified in the heading. Paper 116 at 3. Paper and
`exhibit numbers used herein are from IPR2015-01750.
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`TABLE OF CONTENTS
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`I.
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`The Panel Change Did Not Violate Due Process ............................................ 1
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`A.
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`B.
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`RPX Has No Property or Liberty Interest at Stake in These Cases ...... 1
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`The Board’s Procedure Complied with Due Process Requirements .... 3
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`II.
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`The Board’s Discretionary Denial of Review Is Procedurally Proper ............ 7
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`TABLE OF AUTHORITIES
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` Page(s)
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`Cases
`Am. Mfrs. Mut. Ins. Co. v. Sullivan,
`526 U.S. 40 (1999) ................................................................................................ 1
`Arthrex, Inc. v. Smith & Nephew, Inc.,
`941 F.3d 1320 (Fed. Cir. 2019) ............................................................................ 2
`Cuozzo Speed Techs., LLC v. Lee,
`136 S. Ct. 2131 (2016) .......................................................................................... 3
`Dell Inc. v. Acceleron, LLC,
`884 F.3d 1364 (Fed. Cir. 2018) ............................................................................ 6
`GEA Process Eng’g, Inc. v. Steuben Foods, Inc.,
`IPR2014-0041, Paper 135 (Dec. 23, 2014) .......................................................... 4
`Kerry v. Din,
`576 U.S. 86 (2015) ................................................................................................ 2
`Mathews v. Eldridge,
`424 U.S. 319 (1976) .............................................................................................. 5
`Moles v. Regents of Univ. of California,
`654 P.2d 740 (Cal. 1982) ...................................................................................... 4
`Morrissey v. Brewer,
`408 U.S. 471 (1972) .............................................................................................. 5
`Withrow v. Larkin,
`421 U.S. 35 (1975) ................................................................................................ 7
`Statutes
`35 U.S.C. § 316(b) ..................................................................................................... 6
`
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`
`
`ii
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`Other Authorities
`37 C.F.R. § 42.1 ......................................................................................................... 6
`37 C.F.R. § 42.23(b) .................................................................................................. 5
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`iii
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`Pursuant to Board authorization by email dated October 16, 2020, Patent
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`Owner Applications in Internet Time, LLC (“AIT”) submits this response to
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`Petitioner RPX Corporation’s (“RPX’s”) Request for Rehearing (“Req.”) addressing
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`RPX’s procedural arguments regarding due process and discretionary denial (Req.
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`at 1–3, 15).
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`RPX’s brief fails to state the legal standard or cite any controlling precedent
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`supporting its due process argument. The lack of analysis causes RPX to miss two
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`basic points: first, constitutional due process protections do not apply where, as here,
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`RPX’s liberty or property rights are not at stake; second, even if they did, they would
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`not require the exceptional remedies that RPX requests. Likewise, the Board’s
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`discretionary denial analysis was procedurally proper and correct on the merits.
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`I.
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`THE PANEL CHANGE DID NOT VIOLATE RPX’S DUE PROCESS
`RIGHTS
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`A. RPX Has No Property or Liberty Interest at Stake in These Cases
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`Initially, RPX fails to establish the most basic requirement of due process,
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`namely, a protected interest that would be affected by the outcome of these
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`proceedings. “The first inquiry in every due process challenge is whether the
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`plaintiff has been deprived of a protected interest in ‘property’ or ‘liberty.’ Only
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`after finding the deprivation of a protected interest do we look to see if the …
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`procedures comport with due process.” Am. Mfrs. Mut. Ins. Co. v. Sullivan, 526 U.S.
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`40, 59 (1999) (internal citations omitted). And “no process is due if one is not
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`deprived of ‘life, liberty, or property.’” Kerry v. Din, 576 U.S. 86, 90 (2015)
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`(emphasis in original). Unlike Patent Owner AIT, RPX has no property interest at
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`stake in these cases. Further, RPX concedes that it has no risk of liability for
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`infringement (Req. at 7, 11). Notably, RPX mentions no other property or liberty
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`interest of its own that would be affected by the outcome of these cases.
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`Here, RPX fails to identify a protected interest, simply because RPX does not
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`have such an interest. Indeed, RPX attempts to avoid the issue by relying on dictum
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`in the Federal Circuit’s Arthrex decision noting that “it is not clear whether … mid-
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`case de-designation of an APJ could create a Due Process problem.” Arthrex, Inc.
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`v. Smith & Nephew, Inc., 941 F.3d 1320, 1332 n.3 (Fed. Cir. 2019).2 In Arthrex, the
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`patent owner had a property interest at stake and, as such, it was entitled to due
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`process. In contrast, RPX does not own the challenged patents. Nor is RPX accused
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`of infringing those patents.3 Therefore, even assuming that a panel change could
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`2 RPX provided an incomplete version of this quote implying the Federal Circuit
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`suggested mid-case de-designation does create a Due Process problem. See Req.
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`at 1. The Federal Circuit, however, took no such position.
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`3 AIT accused Salesforce.com, Inc. (“Salesforce”) of infringement in parallel
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`proceedings. Paper 128 at 24. However, the point of RPX’s request for rehearing
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`is to deny that Salesforce is a real party in interest in these cases.
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` 2
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`create a so-called “Due Process problem” in some cases, no such problem exists
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`here.
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`B.
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`The Board’s Procedure Complied with Due Process Requirements
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`To the extent RPX can claim due process rights, the procedures followed by
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`the Board comply with the requirements of procedural due process. RPX had an
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`opportunity to make its case both on paper and at oral argument. In fact, the Board
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`heard oral argument twice, both before and after remand. See Papers 77, 123 (public
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`versions). RPX’s only complaint is that the decision terminating the proceedings
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`was authored by a panel of judges different from the panel that heard oral argument.
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`However, even if RPX were entitled to due process, a mere change of panel would
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`not constitute a due process violation.
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`As an initial matter, standard Board practice does not require an oral hearing
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`prior to a termination decision, consistently with the fact that “the agency’s decision
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`to deny a petition is a matter committed to the Patent Office’s discretion.” Cuozzo
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`Speed Techs., LLC v. Lee, 136 S. Ct. 2131, 2140 (2016). While the parties typically
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`request oral argument after institution, the Board regularly denies institution and/or
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`terminates trial on grounds of real party in interest and time bar without any oral
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`argument. See also GEA Process Eng’g, Inc. v. Steuben Foods, Inc., IPR2014-0041,
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`Paper 135 at 26 n.14 (Dec. 23, 2014) (terminating proceedings on real party in
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` 3
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`interest grounds, and noting that “[g]iven that trials should not have been instituted
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`in these proceedings, we do not hold an oral hearing.”). RPX fails to articulate why
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`a practice that is routinely applied by the Board would constitute a due process
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`violation in this particular case.
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`Moreover, RPX creates its own legal standard, contending that “[d]ue process
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`required that these cases be decided by the panel that conducted a pre-hearing
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`conference … and participated at oral hearing.” Req. at 1. The only authority that
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`RPX cites for that proposition is a state court decision. Moles v. Regents of Univ. of
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`California, 654 P.2d 740 (Cal. 1982). However, the Moles court specifically relied
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`on provisions of the California state constitution, including that “a Court of Appeal
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`shall conduct itself as a three-judge court and that the concurrence of two justices
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`present at the argument is necessary for a judgment.” Id. at 742 n.2 (emphasis
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`added). No equivalent statutory or regulatory provisions are applicable to Board
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`proceedings, and certainly not to termination decisions by the Board.
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`Under the correct standard, RPX is not entitled to either an oral argument
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`before the new panel, or a written decision from the original panel. Indeed, RPX
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`fails to address, let alone satisfy, the applicable standard for due process. See
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`Mathews v. Eldridge, 424 U.S. 319, 335 (1976) (setting forth balancing test
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`considering the “private interest” affected, the “risk of an erroneous deprivation of
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` 4
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`such interest,” and the “Government’s interest” including the “fiscal and
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`administrative burdens” associated with additional procedural requirements).4
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`Moreover, “due process is flexible and calls for such procedural protections as the
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`particular situation demands.” Morrissey v. Brewer, 408 U.S. 471, 481 (1972).
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`Here, RPX had every opportunity to urge its positions in briefing and at oral
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`argument before the original panel. The transcript of oral argument, along with the
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`full written record, was before the deciding panel. RPX does not claim that the
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`issues in the case changed when the case was reassigned to a new panel of senior
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`judges. Indeed, RPX could not raise new arguments at the hearing that it had not
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`raised in the briefs considered by the deciding panel. See Dell Inc. v. Acceleron,
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`LLC, 884 F.3d 1364, 1369 (Fed. Cir. 2018). Simply put, RPX was granted all
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`possible procedural protections it could claim. Moreover, the Board notified the
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`parties of the panel change on September 4, 2020, five days prior to the target date
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`for issuing a decision on remand (September 9, 2020). Paper 124. RPX did not
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`4 Any belated attempt by RPX to address the Mathews analysis for the first time in
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`its reply brief would be improper and should be disregarded by the Board. See 37
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`C.F.R. § 42.23(b); Patent Trial and Appeal Board Consolidated Trial Practice Guide
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`at 74 (Nov. 2019) (“[A] reply … that raises a new issue or belatedly presents
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`evidence may not be considered.”).
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` 5
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`reach out to the Board at that time to request a new oral argument, and instead chose
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`to wait for the decision to issue.
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`After receiving an unfavorable decision, RPX now alleges that reassigning the
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`cases to a new panel of senior judges, without holding additional oral argument, was
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`somehow a due process violation. But the Board’s procedure was eminently
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`reasonable under the circumstances. The original complaint against Salesforce was
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`served in November 2013, nearly seven years ago, and the Board already heard two
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`oral arguments in these cases. Thus, the deciding panel adjudicated the cases on the
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`existing record, without burdening the parties and the Board with the delay and effort
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`of an unnecessary third oral argument. This was consistent with the Board’s
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`statutory mandate “to timely complete proceedings,” 35 U.S.C. § 316(b), and its
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`regulatory purpose “to secure the just, speedy, and inexpensive resolution of every
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`proceeding,” 37 C.F.R. § 42.1. These considerations are especially important in
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`proceedings on remand from the Federal Circuit. See Patent Trial and Appeal Board
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`Consolidated Trial Practice Guide at 89 (Nov. 2019) (“In most cases, an additional
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`oral hearing will not be authorized [on remand] ….”).
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`Lastly, RPX insinuates that the new panel is incapable of properly
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`adjudicating these cases, as it “spent only days with the record,” while “the original
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`panel … was fully capable of deciding the merits.” Req. at 3. RPX forgets the
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`“presumption of honesty and integrity in those serving as adjudicators” which
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`applies in every case. Withrow v. Larkin, 421 U.S. 35, 47 (1975). The Board should
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`disregard RPX’s conjectures regarding the panel’s competence and the procedure it
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`followed to reach its decision.
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`II. THE BOARD’S DISCRETIONARY DENIAL OF REVIEW IS
`PROCEDURALLY PROPER
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`RPX also alleges an APA violation “because RPX was given no notice or
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`opportunity to brief the issue” of discretionary denial. Req. at 15. However, the
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`factual findings underpinning the Board’s discretionary denial analysis under
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`Section 314 are exactly the same as for its decision to terminate under
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`Section 315(b), namely, “that RPX’s filings of these Petitions were strategically
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`motivated, at least in part, to provide a second chance at invalidating the AIT patents
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`to benefit Salesforce, which was time-barred from filing any additional petitions.”
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`Dec. at 39. These facts support a conclusion that “Salesforce and RPX are
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`sufficiently related such that the complete overlap in the challenged claims and the
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`significant relationship between RPX and Salesforce would favor denying institution
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`under § 314(a).” Id. at 40. It is unclear what different arguments RPX could have
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`made that it did not already make in support of its Section 315(b) argument. Further,
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`RPX was on notice of those considerations and their ramifications, as they had been
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`raised multiple times during the proceedings. See, e.g., Paper 26 at 40–41; Paper 37
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`at 5.
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`Moreover, RPX’s argument that discretionary denial after trial would “wast[e]
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`the resources spent resolving patentability” (Req. at 15) simply ignores the other
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`factors that the Board is entitled to consider in exercising its discretion. The Board’s
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`discretionary power to deny review serves important policy purposes, e.g., to prevent
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`“abuse of the review process by repeated attacks on patents,” and “to take undue
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`inequities and prejudices to Patent Owner into account.” General Plastic Industrial
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`Co., Ltd. v. Canon Kabushiki Kaisha, IPR2016-01357, Paper 19 at 17 (PTAB Sept.
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`6, 2017) (precedential). Those are the policy considerations that the Board applied
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`here. See Dec. at 38–40. Accordingly, the Board should deny RPX’s request for
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`Respectfully Submitted,
`By:/Steven C. Sereboff/
`Steven C. Sereboff
`ssereboff@socalip.com
`SoCal IP Law Group LLP
`310 N. Westlake Boulevard
`Suite 120
`Westlake Village, CA 91362
`Tele: (805) 230-1350 • Fax: (805) 230-1355
`Attorneys for Applications In Internet Time
`LLC
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` 8
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`rehearing.
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`Date: October 23, 2020
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`CERTIFICATE OF SERVICE
`The undersigned hereby certifies that a copy of this “Patent Owner Response to
`Petitioner’s Request for Rehearing of Final Decision on Remand Terminating
`Institution” has been served via email on October 23, 2020, upon the following:
`
`Richard F. Giunta
`RGiunta-PTAB@wolfgreenfield.com
`Elisabeth H. Hunt
`EHunt-PTAB@wolfgreenfield.com
`Randy J. Pritzker
`RPritzker-PTAB@wolfgreenfield.com
`Michael N. Rader
`MRader-PTAB@wolfgreenfield.com
`
`Dated: October 23, 2020
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`By: /Anneliese Lomonaco/
`
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`Anneliese Lomonaco
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`Paralegal at SoCal IP Law Group
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