Case 2:15-cv-01366-JRG-RSP Document 246 Filed 10/25/16 Page 1 of 92 PageID #: 16472
`
`UNITED STATES DISTRICT COURT
`EASTERN DISTRICT OF TEXAS
`MARSHALL DIVISION
`
`
`
`PERSONALIZED MEDIA
`COMMUNICATIONS, LLC
`
`
`Plaintiff,
`
`
`§
`§
`§
`§
`§
`§
`§
`§
`§
`§
`§
`§
`§
`§
`§
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`
`
`Case No. 2:15-cv-01366-JRG-RSP
`(Lead)
`
`Case No. 2:15-cv-01206-JRG-RSP
`(Consolidated)
`
`
`v.
`
`APPLE, INC.,
`
`v.
`
`TOP VICTORY ELECTRONICS
`(TAIWAN) CO. LTD., ET AL.,
`
`
`Defendants.
`
`
`
`
`MEMORANDUM OPINION AND ORDER
`
` On June 28, 2016, the Court held a hearing to determine the proper construction of the
`
`disputed terms in four patents. The Court has considered the parties’ claim construction briefing
`
`(Dkt. Nos. 148, 160, 161, 162, and 163) and arguments. Based on the intrinsic and extrinsic
`
`evidence, the Court construes the disputed terms in this Memorandum Opinion and Order. See
`
`Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005); Teva Pharm. USA, Inc. v. Sandoz, Inc.,
`
`135 S. Ct. 831 (2015).
`
`BACKGROUND AND THE ASSERTED PATENTS
`
`Personalized Media Communications, (“PMC”) brought two actions alleging patent
`
`infringement. One action was brought against Apple, Inc. (“Apple”). Another action was brought
`
`against Top Victory Electronics (Taiwan) Co. Ltd., TPV Int’l (USA), Inc., Envision Peripherals,
`
`Inc., Top Victory Electronics (Fujian) Co. Ltd., TPV Electronics (Fujian) Co. Ltd., TPV
`
`PMC Exhibit 2013
`Apple v. PMC
`IPR2016-01520
`Page 1
`
`

`

`Case 2:15-cv-01366-JRG-RSP Document 246 Filed 10/25/16 Page 2 of 92 PageID #: 16473
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`Technology Ltd., Hon Hai Precision Industry (Taiwan) Co., Ltd., Wistron Corp., Wistron
`
`Infocomm Technology (Texas) Corp., Wistron Infocomm Technology (America) Corp., and
`
`Vizio (collectively, “Vizio Defendants”). The two actions have been consolidated for pre-trial
`
`purposes. Further, the claim construction has been separated into two phases. This Opinion and
`
`Order addresses Phase 1. Phase 1 includes the construction of the four patents asserted in the
`
`action against Apple: U.S. Patent Nos. 7,752,649 (“the ’2,649 Patent”), 8,191,091 (“the ’091
`
`Patent”), 8,559,635 (“the ’635 Patent”), and 8,752,088 (“the ’088 Patent”) (collectively, “the
`
`Phase 1 Patents”). The ’2,649 Patent is also asserted against the Vizio Defendants along with a
`
`number of other patents. The ’2,649 Patent claim terms that overlap both actions are included in
`
`the Phase 1 construction.
`
`The Phase 1 patents are part of patent family which has extensive prosecution and
`
`litigation history, including multiple prior litigations, reexaminations and IPRs. The Phase 1
`
`patents were originally filed in May and June 1995 and are part of a chain of continuation
`
`applications filed from U.S. Patent 4,965,825 (“the ’825 Patent). The ’825 Patent issued from an
`
`application filed in 1987. The ’825 Patent was a continuation-in-part application of another
`
`application first filed in 1981 (now U.S. Patent No. 4,694,490).1 The parties appear to dispute
`
`which priority date is applicable to which Phase 1 Patent. At the hearing, the parties indicated
`
`that PMC originally contended that the ’635 Patent and ’088 Patent claims are entitled to a
`
`priority to the 1981 specification and the ’091 Patent and ’2,649 Patent claims are entitled to a
`
`priority to the 1987 specification. However, shortly before the hearing, PMC changed its
`
`contentions with regard to the ’091 Patent claims, now asserting priority to the 1981
`
`specification. (Dkt. No. 194 at 13-14, 50-51.)
`
`1 For citations to the 1981 specification the parties cite to the ’490 Patent. For citations to the 1987
`specification the parties cite to the ’091 Patent.
`
`PMC Exhibit 2013
`Apple v. PMC
`IPR2016-01520
`Page 2
`
`

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`Case 2:15-cv-01366-JRG-RSP Document 246 Filed 10/25/16 Page 3 of 92 PageID #: 16474
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`The disputed terms fall into 24 term groupings. In addition to the claim construction
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`disputes, Apple and Vizio argue that PMC’s expert declaration should be afforded no weight.2
`
`The Phase 1 Patents generally relate to the delivery of programming content to
`
`consumers. More particularly, the patents relate to the concept of delivering “personalized”
`
`programming. The Phase 1 Patents share a common Abstract:
`
`A unified system of programming communication. The system
`encompasses the prior art (television, radio, broadcast hardcopy, computer
`communications, etc.) and new user specific mass media. Within the unified
`system, parallel processing computer systems, each having an input (e.g., 77)
`controlling a plurality of computers (e.g., 205), generate and output user
`information at receiver stations. Under broadcast control, local computers (73,
`205), combine user information selectively into prior art communications to
`exhibit personalized mass media programming at video monitors (202), speakers
`(263), printers (221), etc. At intermediate transmission stations (e.g., cable
`television stations), signals in network broadcasts and from local inputs (74, 77,
`97, 98) cause control processors (71) and computers (73) to selectively automate
`connection and operation of receivers (53), recorder/players (76), computers (73),
`generators (82), strippers (81), etc. At receiver stations, signals in received
`transmissions and from local inputs (225, 218, 22) cause control processors (200)
`and computers (205) to automate connection and operation of converters (201),
`tuners (215), decryptors (224), recorder/players (217), computers (205), furnaces
`(206), etc. Processors (71, 200) meter and monitor availability and usage of
`programming.
`
`’2,649 Abstract. In one of the IPR decisions, the concepts of the 1987 specification have been
`succinctly described in relation to U.S. Patent 5,887,243 as:
`The ’243 patent discloses a system for viewing a conventional broadcast
`program simultaneously with relevant user specific information at a subscriber
`station. Ex. 1003, 6:61–67.
`Figure 1, below, is illustrative of the system.
`
`2 Apple contends that Dr. Weaver’s declaration (Dkt. No. 148-41) consists of nothing more than
`conclusory statements and legal argument that should be given no weight. Apple further contends that Dr.
`Weaver admits that he is not an expert in analog or digital television or broadcast transmissions. (Dkt. No.
`161 at 30 (citing Dkt. No. 161 Ex. 9, Weaver Tr. at 216:6-20).) Vizio makes similar assertions. The
`Court’s findings as described herein do not rely on the Weaver declaration, largely rendering that dispute
`moot for the claim construction issues.
`
`PMC Exhibit 2013
`Apple v. PMC
`IPR2016-01520
`Page 3
`
`

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`Case 2:15-cv-01366-JRG-RSP Document 246 Filed 10/25/16 Page 4 of 92 PageID #: 16475
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`
`
`Figure 1 “is a block diagram of a video/computer combined medium
`receiver station.” Ex. 1003, 9:39–40. The subscriber (receiver) station includes
`television tuner 215 for receiving a broadcast transmission, divider 4, TV signal
`decoder 203, microcomputer 205, and TV monitor 202M. Microcomputer 205
`sends a query to a remote data source, and after receiving data from that source,
`generates graphics from that data that can be combined with the television
`broadcast video signal displayed by TV monitor 202M. Id. at 10:56–11:37;
`236:65–237:20.
`The ’243 patent provides an example of combining a graph of the market
`performance from a “Wall Street Week” program and financial data specific to
`each subscriber. In other words, monitor 205 displays “Wall Street Week” at the
`same time it displays previously stored data from another remote source that
`contains data about a user’s stock portfolio. Id. at 14:13–39. Microprocessor 205
`accesses a floppy disk that holds a data file containing a portfolio of financial
`instruments owned by the specific subscriber at that subscriber station. During a
`program broadcast, microcomputer 205 also receives
`instruction signals
`embedded in the “Wall Street Week” programming transmission. Id. at 14:23–37.
`The embedded signals
`include a set of control
`instructions
`to control
`microcomputer 205 at each subscriber station. Id. at 13:1–14:38.
`In response
`to
`the embedded signals, microcomputer 205 enters
`information at the video RAM of the graphics card for graphing the subscriber’s
`portfolio information. Id. at 13:44–65. A subsequent embedded signal instructs
`the microcomputer to overlay the graphic information onto the received video
`broadcast and transmit the combined information to TV monitor 202M, thereby
`displaying a dual graph showing a subscriber’s portfolio performance relative to
`the overall market performance generated during the “Wall Street Week” show.
`Id. at 14:23–
`36.
`
`Figure 1C below, reproduced from the ’243 patent, depicts such an
`overlay:
`
`
`
`
`
`PMC Exhibit 2013
`Apple v. PMC
`IPR2016-01520
`Page 4
`
`

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`Figure 1C above depicts a dual graph representing an individual
`subscriber’s portfolio performance overlaid on the Wall Street Week graph that
`represents overall market performance. As an example of creating the instruction
`signal to stimulate the overlay, during the broadcast of Wall Street Week, after the
`host describes overall market performance,
`the host says, “[a]nd here is what your portfolio did.” At this point,
`an instruction signal is generated at said program origination
`studio, embedded
`in
`the programming
`transmission, and
`transmitted. . . . Said signal instructs microcomputer[] 205 . . . to
`overlay composite video information and transmit the
`combined information to TV monitor [205]. Id. at 14:23–33.
`
`
`(Dkt. No. 161 Ex. 14 at 3-5.)
`
`
`LEGAL PRINCIPLES
`
`Claim Construction
`
`“It is a ‘bedrock principle’ of patent law that ‘the claims of a patent define the invention
`
`to which the patentee is entitled the right to exclude.’” Phillips v. AWH Corp., 415 F.3d 1303,
`
`1312 (Fed. Cir. 2005) (en banc) (quoting Innova/Pure Water Inc. v. Safari Water Filtration Sys.,
`
`Inc., 381 F.3d 1111, 1115 (Fed. Cir. 2004)). To determine the meaning of the claims, courts start
`
`by considering the intrinsic evidence. Id. at 1313; C.R. Bard, Inc. v. U.S. Surgical Corp., 388
`
`F.3d 858, 861 (Fed. Cir. 2004); Bell Atl. Network Servs., Inc. v. Covad Commc’ns Group, Inc.,
`
`262 F.3d 1258, 1267 (Fed. Cir. 2001). The intrinsic evidence includes the claims themselves, the
`
`specification, and the prosecution history. Phillips, 415 F.3d at 1314; C.R. Bard, Inc., 388 F.3d at
`
`861. The general rule—subject to certain specific exceptions discussed infra—is that each claim
`
`PMC Exhibit 2013
`Apple v. PMC
`IPR2016-01520
`Page 5
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`

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`term is construed according to its ordinary and accustomed meaning as understood by one of
`
`ordinary skill in the art at the time of the invention in the context of the patent. Phillips, 415 F.3d
`
`at 1312–13; Alloc, Inc. v. Int’l Trade Comm’n, 342 F.3d 1361, 1368 (Fed. Cir. 2003); Azure
`
`Networks, LLC v. CSR PLC, 771 F.3d 1336, 1347 (Fed. Cir. 2014) (“There is a heavy
`
`presumption that claim terms carry their accustomed meaning in the relevant community at the
`
`relevant time.”) (vacated on other grounds).
`
` “The claim construction inquiry . . . begins and ends in all cases with the actual words of
`
`the claim.” Renishaw PLC v. Marposs Societa’ per Azioni, 158 F.3d 1243, 1248 (Fed. Cir. 1998).
`
`“[I]n all aspects of claim construction, ‘the name of the game is the claim.’” Apple Inc. v.
`
`Motorola, Inc., 757 F.3d 1286, 1298 (Fed. Cir. 2014) (quoting In re Hiniker Co., 150 F.3d 1362,
`
`1369 (Fed. Cir. 1998)). First, a term’s context in the asserted claim can be instructive. Phillips,
`
`415 F.3d at 1314. Other asserted or unasserted claims can also aid in determining the claim’s
`
`meaning, because claim terms are typically used consistently throughout the patent. Id.
`
`Differences among the claim terms can also assist in understanding a term’s meaning. Id. For
`
`example, when a dependent claim adds a limitation to an independent claim, it is presumed that
`
`the independent claim does not include the limitation. Id. at 1314–15.
`
`“[C]laims ‘must be read in view of the specification, of which they are a part.’” Id.
`
`(quoting Markman v. Westview Instruments, Inc., 52 F.3d 967, 979 (Fed. Cir. 1995) (en banc)).
`
`“[T]he specification ‘is always highly relevant to the claim construction analysis. Usually, it is
`
`dispositive; it is the single best guide to the meaning of a disputed term.’” Id. (quoting Vitronics
`
`Corp. v. Conceptronic, Inc., 90 F.3d 1576, 1582 (Fed. Cir. 1996)); Teleflex, Inc. v. Ficosa N. Am.
`
`Corp., 299 F.3d 1313, 1325 (Fed. Cir. 2002). But, “‘[a]lthough the specification may aid the
`
`court in interpreting the meaning of disputed claim language, particular embodiments and
`
`PMC Exhibit 2013
`Apple v. PMC
`IPR2016-01520
`Page 6
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`

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`Case 2:15-cv-01366-JRG-RSP Document 246 Filed 10/25/16 Page 7 of 92 PageID #: 16478
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`examples appearing in the specification will not generally be read into the claims.’” Comark
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`Commc’ns, Inc. v. Harris Corp., 156 F.3d 1182, 1187 (Fed. Cir. 1998) (quoting Constant v.
`
`Advanced Micro-Devices, Inc., 848 F.2d 1560, 1571 (Fed. Cir. 1988)); see also Phillips, 415
`
`F.3d at 1323. “[I]t is improper to read limitations from a preferred embodiment described in the
`
`specification—even if it is the only embodiment—into the claims absent a clear indication in the
`
`intrinsic record that the patentee intended the claims to be so limited.” Liebel-Flarsheim Co. v.
`
`Medrad, Inc., 358 F.3d 898, 913 (Fed. Cir. 2004).
`
`The prosecution history is another tool to supply the proper context for claim
`
`construction because, like the specification, the prosecution history provides evidence of how the
`
`U.S. Patent and Trademark Office (“PTO”) and the inventor understood the patent. Phillips, 415
`
`F.3d at 1317. However, “because the prosecution history represents an ongoing negotiation
`
`between the PTO and the applicant, rather than the final product of that negotiation, it often lacks
`
`the clarity of the specification and thus is less useful for claim construction purposes.” Id. at
`
`1318; see also Athletic Alternatives, Inc. v. Prince Mfg., 73 F.3d 1573, 1580 (Fed. Cir. 1996)
`
`(ambiguous prosecution history may be “unhelpful as an interpretive resource”).
`
`Although extrinsic evidence can also be useful, it is “‘less significant than the intrinsic
`
`record in determining the legally operative meaning of claim language.’” Phillips, 415 F.3d at
`
`1317 (quoting C.R. Bard, Inc., 388 F.3d at 862). Technical dictionaries and treatises may help a
`
`court understand the underlying technology and the manner in which one skilled in the art might
`
`use claim terms, but technical dictionaries and treatises may provide definitions that are too
`
`broad or may not be indicative of how the term is used in the patent. Id. at 1318. Similarly,
`
`expert testimony may aid a court in understanding the underlying technology and determining
`
`the particular meaning of a term in the pertinent field, but an expert’s conclusory, unsupported
`
`PMC Exhibit 2013
`Apple v. PMC
`IPR2016-01520
`Page 7
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`

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`Case 2:15-cv-01366-JRG-RSP Document 246 Filed 10/25/16 Page 8 of 92 PageID #: 16479
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`assertions as to a term’s definition are entirely unhelpful to a court. Id. Generally, extrinsic
`
`evidence is “less reliable than the patent and its prosecution history in determining how to read
`
`claim terms.” Id. The Supreme Court recently explained the role of extrinsic evidence in claim
`
`construction:
`
`In some cases, however, the district court will need to look beyond the patent’s
`intrinsic evidence and to consult extrinsic evidence in order to understand, for
`example, the background science or the meaning of a term in the relevant art
`during the relevant time period. See, e.g., Seymour v. Osborne, 11 Wall. 516, 546
`(1871) (a patent may be “so interspersed with technical terms and terms of art that
`the testimony of scientific witnesses is indispensable to a correct understanding of
`its meaning”). In cases where those subsidiary facts are in dispute, courts will
`need to make subsidiary factual findings about that extrinsic evidence. These are
`the “evidentiary underpinnings” of claim construction that we discussed in
`Markman, and this subsidiary fact finding must be reviewed for clear error on
`appeal.
`
`Teva Pharm. USA, Inc. v. Sandoz, Inc., 135 S. Ct. 831, 841 (2015).
`
`Departing from the Ordinary Meaning of a Claim Term
`
`There are “only two exceptions to [the] general rule” that claim terms are construed
`
`according to their plain and ordinary meaning: “1) when a patentee sets out a definition and acts
`
`as his own lexicographer, or 2) when the patentee disavows the full scope of the claim term
`
`either in the specification or during prosecution.”3 Golden Bridge Tech., Inc. v. Apple Inc., 758
`
`F.3d 1362, 1365 (Fed. Cir. 2014) (quoting Thorner v. Sony Comput. Entm’t Am. LLC, 669 F.3d
`
`1362, 1365 (Fed. Cir. 2012)); see also GE Lighting Sols., LLC v. AgiLight, Inc., 750 F.3d 1304,
`
`1309 (Fed. Cir. 2014) (“[T]he specification and prosecution history only compel departure from
`
`the plain meaning in two instances: lexicography and disavowal.”). The standards for finding
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`lexicography or disavowal are “exacting.” GE Lighting Sols., 750 F.3d at 1309.
`
`3 Some cases have characterized other principles of claim construction as “exceptions” to the general rule,
`such as the statutory requirement that a means-plus-function term is construed to cover the corresponding
`structure disclosed in the specification. See, e.g., CCS Fitness, Inc. v. Brunswick Corp., 288 F.3d 1359,
`1367 (Fed. Cir. 2002).
`
`PMC Exhibit 2013
`Apple v. PMC
`IPR2016-01520
`Page 8
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`

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`To act as his own lexicographer, the patentee must “clearly set forth a definition of the
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`disputed claim term,” and “clearly express an intent to define the term.” Id. (quoting Thorner,
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`669 F.3d at 1365); see also Renishaw, 158 F.3d at 1249. The patentee’s lexicography must
`
`appear “with reasonable clarity, deliberateness, and precision.” Renishaw, 158 F.3d at 1249.
`
`To disavow or disclaim the full scope of a claim term, the patentee’s statements in the
`
`specification or prosecution history must amount to a “clear and unmistakable” surrender. Cordis
`
`Corp. v. Boston Sci. Corp., 561 F.3d 1319, 1329 (Fed. Cir. 2009); see also Thorner, 669 F.3d at
`
`1366 (“The patentee may demonstrate intent to deviate from the ordinary and accustomed
`
`meaning of a claim term by including in the specification expressions of manifest exclusion or
`
`restriction, representing a clear disavowal of claim scope.”). “Where an applicant’s statements
`
`are amenable to multiple reasonable interpretations, they cannot be deemed clear and
`
`unmistakable.” 3M Innovative Props. Co. v. Tredegar Corp., 725 F.3d 1315, 1326 (Fed. Cir.
`
`2013).
`
`Definiteness Under 35 U.S.C. § 112, ¶ 2 (pre-AIA) / § 112(b) (AIA)4
`
`Patent claims must particularly point out and distinctly claim the subject matter regarded
`
`as the invention. 35 U.S.C. § 112, ¶ 2. A claim, when viewed in light of the intrinsic evidence,
`
`must “inform those skilled in the art about the scope of the invention with reasonable certainty.”
`
`Nautilus Inc. v. Biosig Instruments, Inc., 134 S. Ct. 2120, 2129 (2014). If it does not, the claim
`
`fails § 112, ¶ 2 and is therefore invalid as indefinite. Id. at 2124. Whether a claim is indefinite is
`
`determined from the perspective of one of ordinary skill in the art as of the time the application
`
`for the patent was filed. Id. at 2130. As it is a challenge to the validity of a patent, the failure of
`
`any claim in suit to comply with § 112 must be shown by clear and convincing evidence. Id. at
`
`4 Because the applications resulting in the Asserted Patents were filed before September 16, 2012, the
`Court refers to the pre-AIA version of § 112.
`
`PMC Exhibit 2013
`Apple v. PMC
`IPR2016-01520
`Page 9
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`

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` 16481
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`2130 n.10. “[I]ndefiniteness is a question of law and in effect part of claim construction.” ePlus,
`
`Inc. v. Lawson Software, Inc., 700 F.3d 509, 517 (Fed. Cir. 2012).
`
`When a term of degree is used in a claim, “the court must determine whether the patent
`
`provides some standard for measuring that degree.” Biosig Instruments, Inc. v. Nautilus, Inc.,
`
`783 F.3d 1374, 1378 (Fed. Cir. 2015) (quotation marks omitted). Likewise, when a subjective
`
`term is used in a claim, “the court must determine whether the patent’s specification supplies
`
`some standard for measuring the scope of the [term].” Datamize, LLC v. Plumtree Software, Inc.,
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`417 F.3d 1342, 1351 (Fed. Cir. 2005); accord Interval Licensing LLC v. AOL, Inc., 766 F.3d
`
`1364, 1371 (Fed. Cir. 2014) (citing Datamize, 417 F.3d at 1351).
`
`In the context of a claim governed by 35 U.S.C. § 112, ¶ 6, the claim is invalid as
`
`indefinite if the claim fails to disclose adequate corresponding structure to perform the claimed
`
`functions. Williamson, 792 F.3d at 1351–52. The disclosure is inadequate when one of ordinary
`
`skill in the art “would be unable to recognize the structure in the specification and associate it
`
`with the corresponding function in the claim.” Id. at 1352.
`
`
`
`AGREED TERMS
`
`The parties agreed to the following constructions:
`
`
`
`Term
`enabling information
`
`(’091 Patent claim 26)
`multimedia receiving apparatus
`
`(’088 Patent claim 14)
`decryptor
`
`(’635 Patent claims 1, 2, 18, 21, 32, 33)
`processor instructions
`
`Agreed Construction As
`Between PMC and Apple
`information that enables decryption of said
`encrypted information
`
`a device that is capable of receiving and
`processing multiple forms of media
`
`a device or circuitry that performs decryption
`
`needs no construction
`
`PMC Exhibit 2013
`Apple v. PMC
`IPR2016-01520
`Page 10
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`

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` 16482
`
`
`(’091 Patent claim 20)
`control information
`
`(’2,649 Patent claims 39, 54, 62, 67)
`control signal
`
`(’635 Patent claims 1, 2, 3, 32; ’2,649 Patent
`claim 54).
`
`(Dkt. No. 170 at 3, 5, 6, 15, 20.)
`
`needs no construction
`
`needs no construction
`
`Agreed Construction As
`Between PMC and Vizio
`a device that performs operations according to
`instructions
`
`everything that is transmitted electronically to
`entertain, instruct, or inform, including
`television, radio, broadcast, print, and
`computer programming as well as combined
`medium programming
`video signals encoded as discrete numerical
`values instead of an analog representation
`
`
`
`needs no construction
`
`needs no construction
`
`
`
`Term
`
`
`
`processor
`
`(’2,649 Patent claim 39)
`programming
`
`(’2,649 Patent claim 39)
`
`digital video signals
`
`(’2,649 Patent claim 39)
`
`control information
`
`(’2,649 Patent claim 39)
`control signal
`
`(’2,649 Patent claim 39)
`
`(Dkt. No. 170 at 14, 15-16.)
`
`
`
`PMC Exhibit 2013
`Apple v. PMC
`IPR2016-01520
`Page 11
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` 16483
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`
`
`DISPUTED TERMS
`
`1. decrypting or decryption (’091 Claims 13, 20, 26; ’635 Claims 1, 2, 13, 18, 20, 21, 32,
`33) / decryption key (’091 Claims 13, 20) / encrypted (’091 Claims 13, 20, and 26;
`’635 Claims 1, 2, 18, 20, 21, 32, 33)
`
`
`
`Term
`decrypting / decryption
`
`decryption key
`
`encrypted
`
`
`
`PMC’s Construction
`a method that uses a digital
`key in conjunction with an
`associated
`algorithm
`to
`decipher (render intelligible or
`usable) digital data
`digital data used by a device or
`method in conjunction with an
`associated
`algorithm
`to
`decipher (render intelligible or
`usable)
`encrypted
`digital
`information
`an operation performed on
`digital data in conjunction with
`an associated algorithm and
`digital key to render the digital
`data unintelligible or unusable
`
`Apple’s Construction
`deciphering (rendering
`intelligible or usable) data
`using a key
`
`key used for deciphering
`(rendering intelligible or
`usable) data
`
`
`encoded (rendered
`unintelligible or unusable)
`using a key
`
`The parties dispute if the terms only encompass “digital” processes using a “digital” key.
`
`Positions of the Parties
`
`
`
`PMC contends that its construction is consistent with the ruling in Personalized Media
`
`Commc’ns v. Scientific-Atlanta, Inc., Civil Action. No. 1:02-cv-824-CAP (N.D. Ga. Jun. 6,
`
`2005) and the PTO Board decisions during reexaminations of two related PMC patents. (Dkt.
`
`No. 148 at 2 (citing Dkt. No. 148-27 at 77–78 & Dkt. No. 148-28 at 53–54).) PMC also contends
`
`that a Delaware court found that the terms require the use of “digital.” (Dkt. No. 148 at 4 (citing
`
`Pegasus Dev. Corp. v. DIRECTV, Inc., Case No. 1:00-cv-1020, at *2 n.1 (D. Del. Mar. 25, 2003)
`
`(Dkt. No. 715).)
`
`PMC contends that Apple’s construction ignores the fact that the Phase 1 patents make
`
`clear that decryption and encryption are processes used in connection with digital data. PMC
`
`PMC Exhibit 2013
`Apple v. PMC
`IPR2016-01520
`Page 12
`
`

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`Case 2:15-cv-01366-JRG-RSP Document 246 Filed 10/25/16 Page 13 of 92 PageID #:
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`contends encryption/decryption does not encompass scrambling/descrambling analog signals.
`
`PMC quotes passages from the ’091 Patent:
`
`Various scrambling means are well known in the art for scrambling, usually the
`video portion of analogue television transmissions in such a fashion that only
`subscriber stations with appropriate descrambling means have capacity to tune
`suitably to the television transmission and display the transmitted television image
`information. Encryption/decryption means and methods, well known in the art,
`can regulate the reception and use of, for example, digital video and audio
`television transmissions, digital audio radio and phonograph transmission, digital
`broadcast print transmission, and digital data communications.
`
`’091 Patent 143:20-30.
`
`
`It is obvious to one of ordinary skill in the art that the foregoing is presented by
`way of example only and that the invention is not to be unduly restricted thereby
`since modifications may be made in the structure of the various parts without
`functionally departing from the spirit of the invention. For example, the
`decryption cipher key information and/or algorithm instructions and/or the
`location or locations of said key information and/or instructions may be computed
`in other, more complex or less complex, fashions. And for example, the
`transmitted programming may be processed through fewer than three steps of
`decryption or more than three. And for example, the “Wall Street Week”
`transmission may be of conventional analog television, and the decryptors 107,
`224, and 231, may be conventional descramblers, well known in the art, that
`descramble analog television transmissions and are actuated by receiving digital
`key information.
`
`Id. 159:46-61. PMC contends that in context of the paragraphs above the last sentence does not
`
`mean that descrambling is the same as decryption. PMC points at a sentence which states that
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`“conventional descramblers” (analog) may be used in place of, or as an alternative to, the
`
`“decryptors, 107, 224, and 231.” (Dkt. No. 148 at 3.)
`
`PMC contends that specification when read in context makes clear that decryptors may
`
`be replaced with descramblers if the transmission is “of conventional analog television” because
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`conventional descramblers, PMC says, descramble analog transmissions and decryptors operate
`
`on digital information. (Dkt. No. 163 at 1.) PMC contends a recent Patent Trial and Appeals
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`Board (“PTAB”) panel decision and prior ruling on this issue from the Eastern District of Texas
`
`PMC Exhibit 2013
`Apple v. PMC
`IPR2016-01520
`Page 13
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`

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`read the specification out of context and incorrectly equate descrambling with decrypting. (Dkt.
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`No. 148 at 3, n.8.)
`
`
`
`PMC further points to the PTO Board statement in reexamination of a related patent:
`
`We find encryption to be distinct from scrambling and do not find the use of one
`to teach the use of the other.We find that decryption has utility with digital
`signals, and the use of a decryptor and decryption, in the context of the instant
`Specification, is made specifically with respect to digital signals.
`
`(Dkt. No. 148 Ex. K at 67–68.) PMC also points to the Board’s decision in an appeal of the ’825
`
`Patent in which the Board stated:
`
`We agree with Appellant that “encryption,” as it would have been commonly
`defined by one of ordinary skill in the art at the time of filing, requires a “digital”
`signal. . . . We conclude that “encryption” and “decryption” are not broad enough
`to read on “scrambling” and “unscrambling.”
`
`(Dkt. No. 148 Ex. I at 53–54.) PMC contends that these two Board decisions were made with
`
`respect to the same terms and the same specifications now at issue. PMC further contends that in
`
`the reexamination, it unequivocally disclaimed any construction of “decrypt” that encompasses
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`descrambling of analog content. PMC contends in Pegasus Dev. Corp. v. DIRECTV, Inc., the
`
`Delaware court relied on this disclaimer. It also notes that Apple’s expert Mr. Wechselberger has
`
`stated in contemporaneous publications that encryption is a digital process. (Dkt. No. 148 at 3–
`
`4.)
`
`
`
`In response, Apple contends explicit statements in the specification show that the term
`
`should not be limited to digital data. Apple notes that a prior decision from this District declined
`
`did not include a “digital-only” requirement. Apple points to the specification passage that PMC
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`addressed above and highlights the sentence that says: “decryptors, 107, 224, and 231, may be
`
`conventional descramblers, well known in the art, that descramble analog television
`
`transmissions.” ’091 Patent 159:57–61. Apple points out a Court in this District relied on that
`
`PMC Exhibit 2013
`Apple v. PMC
`IPR2016-01520
`Page 14
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`

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`statement to construe several decryption-related terms in patents with the same specification.
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`Apple further contends based on the same evidence presented by PMC, that the Court “reject[ed]
`
`PMC’s attempt to limit the encrypt/decrypt terms to digital data.” Personalized Media Commc’ns
`
`v. Motorola, Inc., Case No. 2:08-cv-70-CE, Dkt. 271, at **49–54 (E.D. Tex. Sept. 30, 2011).
`
`Apple also points to recent PTAB decisions rejecting PMC’s attempt to limit decryption to
`
`digital data as support for its position. (Dkt. No. 161 at 3 (citing Dkt. No. 161-3 at 8–10 & Dkt.
`
`No. 161-4 at 7–11 (“decryption” encompasses analog descrambling)).)
`
`
`
`Apple contends the construction in Scientific Atlanta was an agreed construction and not
`
`a court ruling. Apple also cites extrinsic dictionary definitions which equate “encryption” with
`
`“scrambling.” Apple further contends that PMC’s own extrinsic evidence notes the terms
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`“encrypting” and “scrambling” are often used interchangeably. (Dkt. No. 161 at 4, n. 6.)
`
`
`
`As to “decryption key,” Apple contends none of the claims specify the decryption key
`
`must be “digital” and further argues the specification’s reference to “digital key” clarifies that a
`
`key is not inherently digital. Apple contends PMC’s construction confusingly references “data
`
`used” to decipher other data. Apple contends “key” is a well understood and widely used term, as
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`PMC’s expert acknowledges. (Id. at 4–5.) Apple notes PMC uses “key” in its constructions of
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`“decrypting” and “encrypted” and that other courts have used “key” as a word in a construction.
`
`(Id. (citing Dkt. No. 161-2 at 49, 54; Dkt. No. 161-11 at 11).)
`
`
`
`At the hearing, PMC further emphasized that that statements made by the applicants
`
`during the prosecution process made clear that the terms in question were limited to use in a
`
`digital environment. In particular, PMC pointed to three different filings. (Dkt. No. 194 at 12–
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`16.) PMC noted that the applicants stated in a 2007 Appeal Brief that “decrypting of encrypted
`
`signals recited in claim 15 relates to digital signals” and “decryption pertains to digital signals,
`
`PMC Exhibit 2013
`Apple v. PMC
`IPR2016-01520
`Page 15
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`

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`which is different from d