`
`UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`MARSHALL DIVISION
`
`
`PERSONALIZED MEDIA
`COMMUNICATIONS, LLC,
`
`
`
`Plaintiff,
`
`
`
`v.
`
`
`APPLE INC.
`
`
`
`
`
`)
`)
`)
`)
`)
`)
`)
`)
`)
`)
`)
`
`Case No. 2:15-cv-01366-JRG-RSP
`
`Defendant.
`
`
`
`APPLE’S REPLY IN SUPPORT OF ITS
`MOTION FOR SUMMARY JUDGMENT OF INVALIDITY
`OF U.S. PATENT NOS. 8,191,091, 8,559,635, AND 7,752,649 UNDER § 101
`
`
`
`
`APPLE EXHIBIT 1057
`APPLE v. PMC
`IPR2016-01520
`Page 1
`
`
`
`Case 2:15-cv-01366-JRG-RSP Document 318 Filed 12/15/16 Page 2 of 11 PageID #: 23489
`
`
`TABLE OF CONTENTS
`
`Page
`
`Response to Counter-Statement of Undisputed Material Facts .........................................1
`
`This Motion Is Not Barred By Any Legal Doctrine ..........................................................2
`
`A.
`
`B.
`
`The Douglass Review Standard Has No Applicability ..........................................2
`
`The Law of the Case Doctrine Does Not Apply ....................................................2
`
`Analysis of A Representative Claims Is Appropriate. .......................................................5
`
`The Asserted Claims Are Directed To Patent-Ineligible Subject Matter. .........................6
`
`I.
`
`II.
`
`III.
`
`IV.
`
`
`
`
`
`
`
`i
`
`
`
`APPLE EXHIBIT 1057
`APPLE v. PMC
`IPR2016-01520
`Page 2
`
`
`
`Case 2:15-cv-01366-JRG-RSP Document 318 Filed 12/15/16 Page 3 of 11 PageID #: 23490
`
`
`TABLE OF AUTHORITIES
`
`
`
`Page(s)
`
`Cases
`
`Amazon.com, Inc. v. Barnesandnoble.com, Inc.,
`239 F.3d 1343 (Fed. Cir. 2001)................................................................................................. 6
`Boundy v. Dolenz,
`No. 3:96-cv-0301, 2002 WL 1160075 (N.D. Tex. May 30, 2002) ........................................... 5
`Christianson v. Colt Ind. Operating Corp.,
`486 U.S. 800 (1988) .............................................................................................................. 3, 4
`Content Extraction and Transmission LLC v. Wells Fargo Bank, Nat’l Ass’n,
`776 F.3d 1343 (Fed. Cir. 2014)................................................................................................. 6
`Douglass v. United States Auto. Ass’n,
`79 F.3d 1415 (5th Cir. 1996) .................................................................................................... 2
`Gibson v. Credit Suisse AG,
`No. 1:10-cv--00001, 2016 WL 4033104 (D. Idaho July 27, 2016) .......................................... 3
`Grant v. City of Pittsburgh,
`98 F.3d 116 (3d Cir. 1996)........................................................................................................ 3
`In re PCH Assocs.,
`949 F.2d 585 (2d Cir. 1991 ................................................................................................... 3, 4
`Language Line Svs., Inc. v. Language Svs. Assocs., Inc.,
`944 F. Supp. 2d 775, 780 (N.D. Cal. 2013) .............................................................................. 3
`Lovell v. Comsewogue Sch. Dist.,
`No. 01-cv-7750, 2005 WL 1398102 10 (E.D.N.Y. June 15, 2005) .......................................... 5
`Massey v. Novartis Pharms. Corp.,
`46 F. Supp. 3d 688 (W.D. Tex. 2014)....................................................................................... 4
`Morrow v. Dillard,
`580 F.2d 1284 (5th Cir. 1978) .................................................................................................. 4
`Nobel Ins. Co. v. City of N.Y.,
`No. 00-CV-1328, 2006 WL 2848121 (S.D.N.Y. Sept. 29, 2006)......................................... 1, 5
`Personalized Media Commc’ns, LLC v. Amazon.com, Inc.,
`161 F. Supp. 3d 325 (D. Del. 2015) .......................................................................................... 6
`Rittgers v. U.S.,
`131 F. Supp. 3d 644 (S.D. Tex. 2015) ...................................................................................... 4
`RSL Comm’ns, PLC v. Bildirci,
`No. 04-cv-5217, 2009 WL 454136 (S.D.N.Y. Feb. 23, 2009) ................................................. 3
`ii
`
`
`
`
`
`APPLE EXHIBIT 1057
`APPLE v. PMC
`IPR2016-01520
`Page 3
`
`
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`Case 2:15-cv-01366-JRG-RSP Document 318 Filed 12/15/16 Page 4 of 11 PageID #: 23491
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`PMC knows that its patents have a problem meeting the standard for patent eligibility
`
`under § 101—the Federal Circuit just summarily affirmed the invalidity of seven closely-related
`
`PMC patents on this ground—and thus its opposition tries to dodge the issue. But Apple’s
`
`motion must be considered on its merits, and the facts and law dictate that PMC’s remaining
`
`asserted patent claims should be invalidated for claiming ineligible subject matter under § 101.
`
`Instead of defending its patent claims on the merits, PMC spends much of its brief
`
`attempting to articulate an unintelligible “law of the case” argument. PMC’s attempt to convince
`
`this Court not to even consider the merits of Apple’s motion seriously misstates the law and
`
`Apple’s motion. Even PMC’s own cases confirm that the doctrine “does not preclude this Court
`
`from reconsidering issues on summary judgment that have initially been raised in the context of
`
`a motion to dismiss.” Nobel Ins. Co. v. City of N.Y., No. 00-CV-1328, 2006 WL 2848121, at *4
`
`(S.D.N.Y. Sept. 29, 2006). Put simply, the “law of the case” doctrine has no applicability to a
`
`different motion filed under a different standard (Rule 12(b)(6) vs. Rule 56) with different (new)
`
`facts obtained during discovery for the Court to consider. Indeed, the Court’s prior ruling on the
`
`motion to dismiss emphasized repeatedly that it was judging the prior motion under the 12(b)(6)
`
`standard—not making fact findings, but rather assuming all pleaded facts as true—and explicitly
`
`contemplated Apple filing a summary judgment motion to provide a more fulsome record for the
`
`Court to consider later in the case. Apple thus properly followed the Court’s guidance in filing
`
`its summary judgment motion, and in fact significant factual and legal developments now inform
`
`the Court’s consideration of the §101 issues on summary judgment. The full record dictates, as
`
`the Federal Circuit affirmed for seven related PMC patents, a finding of invalidity under § 101.
`
`I.
`
`Response to Counter-Statement of Undisputed Material Facts
`
`Apple admits that it did not file objections to the Report and Recommendation (“R&R”)
`
`denying Apple’s Rule 12(b)(6) motion. Apple admits that the Court made the statements in
`
`1
`
`APPLE EXHIBIT 1057
`APPLE v. PMC
`IPR2016-01520
`Page 4
`
`
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`Case 2:15-cv-01366-JRG-RSP Document 318 Filed 12/15/16 Page 5 of 11 PageID #: 23492
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`paragraphs 4-6 and 9-16, but denies that the Court made the statements in paragraphs 1-3 and 7-8
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`because the Court’s 12(b)(6) analysis was about claim 1 of the ’635 patent, not “the claims” of
`
`the ’635 patent. Apple disputes that these statements are “material facts,” however.
`
`II.
`
`This Motion Is Not Barred By Any Legal Doctrine
`
`Desperate to avoid the merits of the §101 challenge on summary judgment, PMC
`
`confusingly argues that the motion is somehow barred by the review standard announced in
`
`Douglass v. United States Auto. Ass’n, 79 F.3d 1415 (5th Cir. 1996) and the “law of the case”
`
`doctrine. Neither argument finds any support in logic or the law.
`
`A.
`
`The Douglass Review Standard Has No Applicability
`
`PMC’s arguments (Dkt. 290 at 1-2) about the standard of review to be applied to the
`
`earlier decision on Apple’s motion to dismiss are confusing to say the least. This Court does not
`
`sit in review of its own or other court rulings, and Apple is not asking the Court to review that
`
`prior ruling. The present motion is a new motion filed under a different standard relying on the
`
`facts and law now available that were not available at the motion to dismiss stage. It is illogical
`
`for PMC to be discussing the R&R’s guidance regarding appellate review of the earlier decision
`
`when the instant motion is not a request for review of that decision. Apple has filed a new
`
`motion under Rule 56, exactly as the Court invited it to do so in its prior ruling, and PMC’s
`
`reference to the Douglass standard of review simply has no relevance.1
`
`B.
`
`The Law of the Case Doctrine Does Not Apply
`
`PMC also mischaracterizes the law of the case doctrine and its applicability to the instant
`
`
`1 PMC’s unsupported argument that Douglass applies beyond appellate review of the ruling to
`which it attaches would result in every litigant in this Court reflexively objecting to every
`single ruling of this Court, without regard to the procedural posture or how to most
`efficiently present issues to the Court. Apple should not be punished for taking up the
`Court’s suggestion (and Apple’s right) to raise the issue in a more full context on summary
`judgment without in parallel objecting unnecessarily to the Court’s Rule 12(b)(6) analysis.
`
`2
`
`APPLE EXHIBIT 1057
`APPLE v. PMC
`IPR2016-01520
`Page 5
`
`
`
`Case 2:15-cv-01366-JRG-RSP Document 318 Filed 12/15/16 Page 6 of 11 PageID #: 23493
`
`
`motion.2 Even though “the court previously rejected the [§ 101] argument in a Motion to
`
`Dismiss, a party may re-raise similar arguments in a Motion for Summary Judgment because the
`
`two types of motions are distinct in posture.” Gibson v. Credit Suisse AG, No. 1:10-cv-00001,
`
`2016 WL 4033104, at *5 (D. Idaho July 27, 2016). For example, in Language Line Svs., Inc. v.
`
`Language Svs. Assocs., Inc., defendants moved for summary judgment on plaintiff’s conversion
`
`claim, after having unsuccessfully moved earlier in the case to dismiss the claim. 944 F. Supp.
`
`2d 775, 780 (N.D. Cal. 2013). The district court rejected plaintiff’s argument that the motion for
`
`summary judgment was nothing more than a motion for reconsideration of the motion to dismiss,
`
`stating “[t]he motion to dismiss stage of a case, of course, is distinct from summary judgment.
`
`As such, similar arguments may be made at each stage of the case without implicating the rules
`
`regarding a motion to reconsider.” Id.; see also Grant v. City of Pittsburgh, 98 F.3d 116, 120-21
`
`(3d Cir. 1996) (appellate court had jurisdiction over appeal from denial of summary judgment
`
`where same issue was presented in a motion to dismiss, because “[t]hough both relied on the
`
`same legal theory [], the second motion did not merely address the pleadings but also relied on
`
`matters obtained during extensive discovery”); RSL Comm’ns, PLC v. Bildirci, No. 04-cv-5217,
`
`2009 WL 454136, at *2 (S.D.N.Y. Feb. 23, 2009) (law of the case doctrine does not bar court
`
`from considering issues on summary judgment that were raised in a motion to dismiss).
`
`PMC argues, in effect, that Apple’s motion for summary judgment is a motion for
`
`reconsideration of the order denying Apple’s motion to dismiss. See, e.g., Dkt. 290 at 1. But
`
`this is a not a motion to reconsider the denial of Apple’s motion to dismiss, but rather a new
`
`motion applying a different legal standard and relying upon additional information that was not
`
`2 Even if the doctrine applied (it does not), PMC also mischaracterizes its effect. The doctrine
`is not a limit on a court’s power that would “bar” Apple from filing, or this court from
`considering, this motion. Christianson v. Colt Ind. Operating Corp., 486 U.S. 800, 817
`(1988). Rather, it is at most “discretionary rule of practice and generally does not limit a
`court’s power to reconsider an issue.” In re PCH Assocs., 949 F.2d 585, 592 (2d Cir. 1991).
`
`3
`
`APPLE EXHIBIT 1057
`APPLE v. PMC
`IPR2016-01520
`Page 6
`
`
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`Case 2:15-cv-01366-JRG-RSP Document 318 Filed 12/15/16 Page 7 of 11 PageID #: 23494
`
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`available at the time Apple filed its motion to dismiss. Since the R&R on Apple’s motion to
`
`dismiss was adopted, this court has construed the patents-in-suit, which PMC itself argued would
`
`inform the patent-eligibility analysis. Dkt. 83 at 13-15; Dkt. 230; Dkt. 246. The parties have
`
`completed fact and expert discovery, and Apple identified undisputed material facts relevant to
`
`its motion that are found outside the pleadings and were thus unavailable in the context of its
`
`motion to dismiss. Dkt. 261; Dkt. 264 at 2. Even since Apple filed this motion, the Federal
`
`Circuit summarily affirmed the Delaware court’s ruling that closely related PMC patents are
`
`invalid under § 101. Dkt. 288. And PMC’s assertions of infringement in the case have proven to
`
`be inconsistent with the positions it took in the motion to dismiss briefing, which had to be
`
`assumed to be true. For example, PMC is now arguing that a “control signal” does not need to
`
`be transmitted with “a unit of programming” (Dkt. 297 at 12-14), when the court’s R&R relied
`
`upon PMC’s representation that the control signal is transmitted with the digital programming
`
`(Dkt. 209 at 11, 16, 18). Apple’s instant motion is thus distinct in numerous ways from its
`
`motion to dismiss, and the law of the case doctrine does not in any way “bar” it.3
`
`The cases PMC cites are not to the contrary. Most of the cases present a very different
`
`procedural posture than exists here. See Morrow v. Dillard, 580 F.2d 1284, 1289-90 (5th Cir.
`
`1978) (appellate court decisions are law of the case and control in any subsequent appeals);
`
`Rittgers v. U.S., 131 F. Supp. 3d 644, 648 n.1 (S.D. Tex. 2015) (ruling on motion to dismiss was
`
`law of the case applicable to all defendants, even if defendant was not a party to the motion to
`
`dismiss); Massey v. Novartis Pharms. Corp., 46 F. Supp. 3d 688, 691 (W.D. Tex. 2014) (MDL
`
`court’s ruling was law of the case in transferor court); Boundy v. Dolenz, No. 3:96-cv-0301, 2002
`
`WL 1160075, at *1 (N.D. Tex. May 30, 2002) (law of the case doctrine precludes sequential
`
`3 Even if the law of the case doctrine were applicable (which it is not), the changed landscape
`suggests that the court should exercise its discretion and consider Apple’s motion for
`summary judgment of invalidity. Christianson, 486 U.S. at 817; PCH, 949 F.2d at 592.
`
`4
`
`APPLE EXHIBIT 1057
`APPLE v. PMC
`IPR2016-01520
`Page 7
`
`
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`Case 2:15-cv-01366-JRG-RSP Document 318 Filed 12/15/16 Page 8 of 11 PageID #: 23495
`
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`motions to dismiss for lack of jurisdiction). Even PMC’s case that is somewhat closer on the
`
`facts is distinguishable. In a magistrate judge deciding the motion for summary judgment stated
`
`that he was bound by a district court judge’s legal rulings on a prior motion to dismiss, but
`
`acknowledged that a defendant’s refined argument on summary judgment was not foreclosed
`
`because it had not been considered by the district court judge. No. 01-cv-7750, 2005 WL
`
`1398102, *6, 7, 10 (E.D.N.Y. June 15, 2005). PMC’s cases confirm the law of the case doctrine
`
`“does not preclude this Court from reconsidering issues on summary judgment that have initially
`
`been raised in the context of a motion to dismiss.” Nobel Ins., 2006 WL 2848121, at *4. The
`
`“law of the case” doctrine simply has no applicability.
`
`III. Analysis of A Representative Claims Is Appropriate.
`
`PMC does not dispute that it is appropriate to analyze representative claims, only whether
`
`the identified claims are representative. But PMC’s cited comparisons of claim 13 of the ’091
`
`patent to claims 20 and 26 are meaningless because we are at a different stage of the case, and
`
`PMC is no longer asserting claims 20 and 26. See Dkt. 290 at 11. Contrary to PMC’s assertions,
`
`Apple explained that the limitations of claim 20 of the ’635 patent substantially overlap with the
`
`other asserted claims of the ’635 patent.4 Dkt. 264 at 4-5. PMC does not dispute that it
`
`identified claim 39 of the ’649 patent as exemplary, or that the side-by-side comparison of the
`
`asserted ’649 patent claims shows they substantially overlap. Dkt. 18 ¶ 98; Dkt. 264, Ex. 5. And
`
`Apple’s expert agrees. Ex. 11; Dkt. 264 Ex. 4, Wechselberger Rpt. ¶¶ 1133-34, 1136-37.5 The
`
`identified claims are representative. See Content Extraction and Transmission LLC v. Wells
`
`
`4 Yet another changed circumstance is the fact that PMC has dropped claims (e.g. claim 1 of
`the ’635 patent) that Apple used as representative in the prior motion to dismiss.
`5 Attached as Exhibit 11 is the declaration of Tony Wechselberger declaring that the
`statements contained in his expert report are true and correct under penalty of perjury.
`Exhibit 9 moots any PMC objections to Apple’s reliance on these statements in its opening or
`reply briefs.
`
`5
`
`APPLE EXHIBIT 1057
`APPLE v. PMC
`IPR2016-01520
`Page 8
`
`
`
`Case 2:15-cv-01366-JRG-RSP Document 318 Filed 12/15/16 Page 9 of 11 PageID #: 23496
`
`
`Fargo Bank, Nat’l Ass’n, 776 F.3d 1343, 1348 (Fed. Cir. 2014) (district court “correctly
`
`determined that addressing each claim of the asserted patents was unnecessary”).
`
`IV.
`
`The Asserted Claims Are Directed To Patent-Ineligible Subject Matter.
`
`PMC’s entire argument that the asserted claims are patent-eligible is to essentially restate
`
`the R&R denying Apple’s motion to dismiss. See Dkt. 290 at 12-14. As explained above,
`
`however, this is a different motion presenting new evidence and judged under a different legal
`
`standard. Tellingly, PMC does not even acknowledge the Federal Circuit’s summary affirmance
`
`of the Delaware court’s opinion invalidating related PMC patents. Dkt. 288; Personalized Media
`
`Commc’ns, LLC v. Amazon.com, Inc., 161 F. Supp. 3d 325 (D. Del. 2015). Despite PMC’s
`
`preference to ignore it, the Federal Circuit’s across-the-board affirmance of the Delaware ruling
`
`is at a minimum highly instructive regarding the patent eligibility of the patents in this case.
`
`PMC contends that it presented evidence in opposition to the motion to dismiss that
`
`shows the claims include inventive concepts. Dkt. 290 at 14. The evidence PMC points to,
`
`however, is its argument that the “instruct-to-enable” or “control” signals are transmitted with
`
`the programming. Dkt. 290 at 14; Dkt. 83-4 ¶¶ 86-89, 125-28, 148-50. PMC is now arguing for
`
`infringement purposes that that a “control signal” does not need to be transmitted with “a unit of
`
`programming.” Dkt. 297 at 12-14. PMC cannot use one argument to defeat this invalidity
`
`motion, then assert the exact opposite argument to defeat a non-infringement motion. See
`
`Amazon.com, Inc. v. Barnesandnoble.com, Inc., 239 F.3d 1343, 1351 (Fed. Cir. 2001) (claims
`
`must be “given the same meaning for purposes of both validity and infringement analyses”).
`
`PMC does not attempt to argue, nor could it, that the claims asserted in this case
`
`materially differ from those in the seven patents found invalid by the District of Delaware and
`
`the Federal Circuit. Indeed, PMC’s arguments that proved unsuccessful at the Federal Circuit
`
`are the same arguments it makes here. For example, PMC argued to the Federal Circuit that the
`
`6
`
`APPLE EXHIBIT 1057
`APPLE v. PMC
`IPR2016-01520
`Page 9
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`
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`Case 2:15-cv-01366-JRG-RSP Document 318 Filed 12/15/16 Page 10 of 11 PageID #:
` 23497
`
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`strikingly-similar claims of the related ’304 patent are “a single, concrete technical solution for
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`the manner in which decryption key information is to be delivered and used.” Compare Ex. 12,
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`PMC Appeal Br. at 41 with Dkt. 290 at 14 (“specific, concrete methods … on the manner in
`
`which a decryption key is to be located and/or generated and used”). This argument, along with
`
`all of PMC’s arguments that the invalidated claims in this patent family are patent-eligible, was
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`summarily rejected by the Federal Circuit. Dkt. 288. If the diversity across the seven patents
`
`invalidated under § 101 in the Amazon proceedings did not lead to different patent eligibility
`
`determinations at the Delaware court and the Federal Circuit, the same result should most
`
`certainly befall the PMC patents asserted here.
`
`Dated: December 15, 2016
`
`Respectfully submitted,
`
`/s/ Melissa R. Smith _
`
`Melissa R. Smith
`State Bar No. 24001351
`GILLAM & SMITH LLP
`303 S. Washington Avenue
`Marshall, Texas 75670
`Telephone: (903) 934-8450
`Facsimile: (903) 934-9257
`E-mail: Melissa@gillamsmithlaw.com
`
`
`Marcus E. Sernel, P.C. (admitted pro hac vice)
`Joel R. Merkin (admitted pro hac vice)
`KIRKLAND & ELLIS LLP
`300 N. LaSalle Street
`Chicago, Illinois 60654
`Telephone: (312) 862-2000
`Facsimile: (312) 862-2200
`E-mail: marc.sernel@kirkland.com
`E-mail: joel.merkin@kirkland.com
`
`Gregory S. Arovas, P.C. (admitted pro hac vice)
`KIRKLAND & ELLIS LLP
`601 Lexington Avenue
`New York, New York 10022
`Telephone: (212) 446-4800
`Facsimile: (212) 446-4900
`E-mail: greg.arovas@kirkland.com
`
`Attorneys for Defendant Apple Inc.
`
`7
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`APPLE EXHIBIT 1057
`APPLE v. PMC
`IPR2016-01520
`Page 10
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`Case 2:15-cv-01366-JRG-RSP Document 318 Filed 12/15/16 Page 11 of 11 PageID #:
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`CERTIFICATE OF SERVICE
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`
`
`The undersigned hereby certifies that all counsel of record who are deemed to have
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`consented to electronic service are being served with a copy of this document via the Court’s
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`CM/ECF system per Local Rule CV-5(a)(3) on December 15, 2016.
`
`
`
`
`
`
`
`
`
`
`
`
`
`/s/ Melissa R. Smith
`
`
`
`
`
`APPLE EXHIBIT 1057
`APPLE v. PMC
`IPR2016-01520
`Page 11
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`Case 2:15-cv-01366-JRG-RSP Document 318-1 Filed 12/15/16 Page 1 of 28 PageID #:
` 23499
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`EXHIBIT 11
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`
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`APPLE EXHIBIT 1057
`APPLE v. PMC
`IPR2016-01520
`Page 12
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`Case 2:15-cv-01366-JRG-RSP Document 318-1 Filed 12/15/16 Page 2 of 28 PageID #:
` 23500
`
`
`UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`MARSHALL DIVISION
`
`
`PERSONALIZED MEDIA
`COMMUNICATIONS, LLC,
`
`
`
`
`
`v.
`
`
`APPLE INC.
`
`
`
`
`
`Plaintiff,
`
`Defendant.
`
`)
`)
`)
`)
`)
`)
`)
`)
`)
`)
`)
`
`Case No. 2:15-cv-01366-JRG-RSP
`
`
`
`DECLARATION OF ANTHONY J. WECHSELBERGER
`
`
`I, Anthony J. Wechselberger, do hereby declare:
`
`1.
`
`The facts set forth in this declaration are based on my personal knowledge and, if
`
`called as a witness, I could and would testify as to their truth.
`
`2.
`
`I am a technical expert retained by Defendant Apple, Inc. (“Apple”) in the above-
`
`captioned litigation to provide my opinions and to testify on certain issues related to U.S. Patent
`
`Nos. 8,191,091 (the “’091 Patent”), 8,559,635 (the “’635 Patent”), 7,752,649 (the “’649 Patent”)
`
`and 8,752,088 (the “’088 Patent”).
`
`3.
`
`I make this declaration in support of Apple’s Motion for Summary Judgment of
`
`Invalidity of U.S. Patent Nos. 8,191,091, 8,559,635, and 7,752,649 Under § 101. I previously
`
`submitted two expert reports in the above-captioned litigation.
`
`4.
`
`Attached to this declaration as Ex. 1 are true and correct copies of excerpted
`
`pages of the invalidity reports I have submitted in the above-captioned litigation and that I
`
`hereby incorporate into this declaration: The “Expert Report of Anthony J. Wechselberger
`
`Regarding Invalidity of U.S. Patent Nos. 8,191,091; 8,559,635; 7,752,649; and 8,752,088” which
`
`
`
`APPLE EXHIBIT 1057
`APPLE v. PMC
`IPR2016-01520
`Page 13
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`Case 2:15-cv-01366-JRG-RSP Document 318-1 Filed 12/15/16 Page 3 of 28 PageID #:
` 23501
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`APPLE EXHIBIT 1057
`APPLE v. PMC
`IPR2016-01520
`Page 14
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`
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`Case 2:15-cv-01366-JRG-RSP Document 318-1 Filed 12/15/16 Page 4 of 28 PageID #:
` 23502
`
`
`
`
`EXHIBIT 1
`
`
`
`
`
`APPLE EXHIBIT 1057
`APPLE v. PMC
`IPR2016-01520
`Page 15
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`Case 2:15-cv-01366-JRG-RSP Document 318-1 Filed 12/15/16 Page 5 of 28 PageID #:
` 23503
`HIGHLY CONFIDENTIAL - ATTORNEYS’ EYES ONLY
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`MARSHALL DIVISION
`
`
`
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`v.
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`APPLE INC.
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`PERSONALIZED MEDIA
`COMMUNICATIONS, LLC,
`
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`Plaintiff,
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`
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`CASE NO. 2:15-CV-01366-JRG-RSP
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`
`
`
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`Defendants.
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`EXPERT REPORT OF ANTHONY J. WECHSELBERGER REGARDING
`INVALIDITY OF U.S. PATENT NOS. 8,191,091; 8,559,635; 7,752,649; AND 8,752,088
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`APPLE EXHIBIT 1057
`APPLE v. PMC
`IPR2016-01520
`Page 16
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`Case 2:15-cv-01366-JRG-RSP Document 318-1 Filed 12/15/16 Page 6 of 28 PageID #:
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`HIGHLY CONFIDENTIAL - ATTORNEYS’ EYES ONLY
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`Digital Video
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`D.
`1121. Based on my understandings of the written description and enablement
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`requirements above it is my opinion that the ’649 Patent fails to satisfy the written description
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`and enablement requirements with respect to Claim 62 to the extent that it is read to exclude
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`processing audio at one of the plurality of processors.
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`1122. I have been informed that PMC’s infringement theories in this case accuse
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`processing of audio and video simultaneously at two or more processors to meet the “processing
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`said digital video signals simultaneously at two or more of said plurality of processors” element.
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`(PMC’s Infringement Contentions (11/24/2015), ’649 Claim charts; PMC’s Infringement
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`Contentions (9/2/2016), ’649 Claim charts.) However, I also understand that PMC has asserted
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`that if one of the two processors processes a pure audio signal, the “processing said digital video
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`signals simultaneously at two or more of said plurality of processors” is not met. (’649 POPR at
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`1, 26-27.)
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`1123. The 1987 specification never describes processing video signals, as PMC is
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`interpreting the phrase, at two or more processors. The specification only describes transferring
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`decrypted audio and video information to a monitor and processing SPAM information
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`embedded in the video information as a result of a compare. (’091 patent at 157:61-159:38.)
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`Furthermore, the specification does not describe the circuity or software that would enable a
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`person of ordinary skill in the art to make and use the full scope of the claim, to the extent that it
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`is read to exclude processing audio at one of the plurality of processors, without undue
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`experimentation. The specification never mentions processing video signals simultaneously at
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`multiple processors, or how one of ordinary skill in the art could use traditional video processing
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`techniques and circuitry to process video information simultaneously at a plurality of processors.
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`289
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`APPLE EXHIBIT 1057
`APPLE v. PMC
`IPR2016-01520
`Page 17
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`1124. In view of the foregoing, the disclosure of the ’649 Patent specification does not
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`convey with reasonable clarity to those skilled in the art that, as of the filing date, the inventor
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`was in possession of an invention that requires processing video signals (not including audio) at
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`a plurality of processors, nor does the specification enable a person skilled in the art to make and
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`use the full scope of the claimed invention that requires processing video signals (not including
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`audio) at a plurality of processors, without undue experimentation. Thus, the ’649 Patent fails to
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`satisfy the written description and enablement requirements of § 112, ¶ 1, with respect to Claim
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`62 to the extent that it is read as excluding processing audio at one of the plurality of processors.
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`1125. To the extent that the disclosure is enough to enable one of ordinary skill in the art
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`to make the claimed invention without undue experimentation, then it is equally true that one of
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`ordinary skill in the art would have found it obvious to make the claimed invention based on the
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`prior art disclosing processing video signals at a single processor.
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`XII. PATENT ELIGIBLE SUBJECT MATTER
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`1126. It is my opinion that Asserted Claims of the Asserted Patents fail to claim
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`anything other than an abstract idea of converting information from one format to another along
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`with generic computer components and conventional functions.
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`1127. I understand that claims that have slightly different wording may be addressed
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`together for the purposes of the 101 analysis if the claims are substantially similar and are linked
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`to the same abstract idea. As I explain below, Claim 13 of the ’091 Patent, Claim 18 of the ’635
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`Patent, and Claim 39 of the ’649 Patent are representative for each asserted patent containing
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`multiple asserted claims.
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`1128. As I stated above in Sections VI.A and VIII.A, I apply September 11, 1987 as the
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`priority date of the alleged inventions recited in the ’091 and ’649 patents, respectively. As I
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`290
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`APPLE EXHIBIT 1057
`APPLE v. PMC
`IPR2016-01520
`Page 18
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`stated above in Section IX.A, I apply November 3, 1981 as the priority date of the alleged
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`invention recited in the ’088 patent. And as I explained above in Section VII.A, to the extent
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`PMC continues to argue, in this proceeding, meanings of terms of the Asserted Claims of the
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`’635 patent that are unsupported by the ’490 specification, the Asserted Claims of the ’635 patent
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`are not entitled to a priority date earlier than September 11, 1987, and thus, for the purposes of
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`this report I analyze the Asserted Claims of the ’635 patent under both the 1981 date and the
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`1987 date.
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`’091 Patent
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`A.
`1129. The Asserted Claims of the ’091 Patent are directed to “method[s] of decrypting
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`programming.” ’091 at Asserted Claims. Decryption is merely an algorithmic conversion of
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`information from one format to another (i.e., transforming data from unintelligible/unusable to
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`intelligible/usable). (Section IV, Court’s Preliminary Constructions.)
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`1130. The claims recite generic signal processing schemes where encrypted content is
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`received and decrypted. Specifically, the Asserted Claims of the ’091 Patent include the steps of
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`receiving an encrypted information transmission, detecting a signal or signals in the
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`transmission, using the signal or signals to decrypt the encrypted information, and outputting
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`decrypted programming. The Asserted Claims are not directed to a specific improvement in
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`(micro) computer technology beyond using a computer in its ordinary capacity as a controller for
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`decryption of encrypted content in the same way that it can be used to control any process.
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`1131. The testimony of the named inventors further supports this view. One of the
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`named inventors, John Harvey, testified that cryptography (and encryption) goes back to the
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`Ancient Greeks and decryptors were used in World War II. (Harvey Tr. at 327:6-16; 328:24-
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`329:13; 387:17-20.) As Mr. Harvey further testified, the claims cover the “concept of decrypting
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`291
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`APPLE EXHIBIT 1057
`APPLE v. PMC
`IPR2016-01520
`Page 19
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`encrypted content,” but not any particular physical embodiment. (Harvey Tr. at 360:6-13.) The
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`conventional nature of the components required for the Asserted Claims is exemplified by
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`PMCAPL00876696, which lists nothing more than conventional components that formed PMC’s
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`alleged prototype. (Harvey Tr. at 488:19-22.) Mr. Harvey also confirmed that he was applying
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`known encryption and decryption techniques to a “new environment.” (Harvey Tr. at 92:9-20.)
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`Mr. Cuddihy also confirmed he and Mr. Harvey did not invent the claimed concepts of the
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`Asserted Patents. (Cuddihy Tr. at 213:24-222:21.)
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`1132. Claim 13 describes a method of decrypting encrypted programming by detecting
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`in “an encrypted digital information transmission” an “instruct-to-enable signal,” locating a
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`decryption key by processing
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`the
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`instruct-to-enable signal, decrypting
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`the encrypted
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`programming using the decryption key, and outputting the decrypted programming.
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`1133. Claim 14 depends from Claim 13 and adds the requirements of computing a
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`second decryption key, and “decrypting said encrypted information using said first and second
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`decryption keys.” Claim 20 is largely similar to Claim 14 in that it requires that the received
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`encrypted information is decrypted using two decryption keys. It differs in requiring two
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`separate “instruct-to-enable signals,” both of which include “processor instructions” which are
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`executed to generate the first and second decryption keys.
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`1134. Claims 15 and 23 depend from Claims 14 and 20, respectively, and further require
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`that “said first and second decryption key