`571-272-7822
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`Paper No. 44
`Entered: August 3, 2015
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`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`FORD MOTOR COMPANY,
`Petitioner,
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`v.
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`PAICE LLC & THE ABELL FOUNDATION, INC.,
`Patent Owner.
`____________
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`Case IPR2014-005701
`Patent 8,214,097 B2
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`Held: July 1, 2015
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`BEFORE: SALLY C. MEDLEY, KALYAN K. DESHPANDE,
`and CARL M. DeFRANCO, Administrative Patent Judges.
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`The above-entitled matter came on for hearing on
`Wednesday, July 1, 2015, commencing at 9:00 a.m., at the U.S.
`Patent and Trademark Office, 600 Dulany Street, Alexandria,
`Virginia.
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`1 This Transcript addresses the same Oral Hearing in the inter
`partes reviews listed in the Appendix. Therefore, we issue one
`Transcript to be filed in all of the cases. The parties, however, are
`not authorized to use this style of filing in subsequent papers.
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`VWGoA - Ex. 1009
`Volkswagen Group of America, Inc. - Petitioner
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`Patent 8,214,097 B2
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`APPEARANCES:
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`ON BEHALF OF THE PETITIONER:
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`FRANK ANGILERI, ESQ.
`JOHN P. RONDINI, ESQ.
`SANGEETA G. SHAH, ESQ.
`ANDREW B. TURNER, ESQ.
`TIMOTHY W. RIFFE, ESQ.
`BRIAN J. LIVEDALEN, ESQ.
`Brooks Kushman P.C.
`1000 Town Center, 22nd Floor
`Southfield, Michigan 48075
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`LISSI MOJICA, ESQ.
`KEVIN GREENLEAF, ESQ.
`NONA DURHAM, ESQ.
`Dentons
`1530 Page Mill Road
`Suite 200
`Palo Alto, California 94304-1125
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`MATTHEW J. MOORE, ESQ.
`Latham & Watkins LLP
`555 Eleventh Street, N.W.
`Suite 1000
`Washington, DC 20004-1304
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`DAVID B. KELLEY, ESQ.
`Ford Global Technologies, LLC
`Fairlane Plaza South
`Suite 800
`330 Town Center Drive
`Dearborn, Michigan 48126-2738
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`Case IPR2014-00570
`Patent 8,214,097 B2
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`APPEARANCES, continued:
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`ON BEHALF OF THE PATENT OWNER:
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`RUFFIN B. CORDELL, ESQ.
`LINDA LIU KORDZIEL, ESQ.
`W. PETER GUARNIERI, ESQ.
`Fish & Richardson P.C.
`1425 K Street, N.W., 11th Floor
`Washington, DC 20005
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`JUDGE DESHPANDE: This morning we have our
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`hearings for IPR2014-00570, 571, 579, 875, 884 and 904, Ford v.
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`Paice and the Abell Foundation. I'm Judge Deshpande, to my left
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`is Judge DeFranco, to my right is Judge Medley. Let's have our
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`parties' appearances. Who do we have for Petitioner?
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`MR. ANGILERI: Your Honor, Frank Angileri for
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`Petitioner, and would you like me to introduce our whole house at
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`this point in time?
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`JUDGE DESHPANDE: Yes.
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`MR. ANGILERI: At counsel table in this session are
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`Andy Turner and John Rondini. Behind me is Sangeeta Shah, she
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`will be joining counsel table for the third session and arguing one
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`of the two in that session. Mr. Rondini will be arguing one of the
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`two in the second session. They are all from my firm, Brooks
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`Kushman.
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`In the back row are Matt Moore, who is Ford's litigation
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`counsel, David Kelley who is in-house counsel at Ford, Kevin
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`Greenleaf, Lissi Mojica and Anna Durham, who are with the
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`Dentons firm. Nona Durham, excuse me.
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`JUDGE DESHPANDE: Great, thank you.
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`Who do we have for Patent Owner?
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`MR. CORDELL: Good morning, Your Honors, Ruffin
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`Cordell from Fish & Richardson, and with me are my colleagues
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`Brian Livedalen and Pete Guarnieri, and arguing later in the day
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`will be Linda Kordziel, and my partner Tim Riffe is here. And I
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`would like to introduce our clients, this is Francie Keenan, who is
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`the chairman of Paice and the CFO of Abell, and Mr. Bill
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`Leinkhuler, who is the general counsel of Paice.
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`JUDGE DESHPANDE: Great, thank you, and
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`welcome, everybody, to the Patent Trial and Appeal Board. As
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`we outlined in the trial hearing order, the procedure for today, I'm
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`just going to go ahead remind everybody of what we have set up.
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`We have three sessions set up, session 1 which will begin now,
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`session 2 that will begin at 12:30, and session 3 that will begin at
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`2:45.
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`In the first session, we will be hearing arguments for
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`IPR2014-00571 and 904. In the second session at 12:30, we will
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`be hearing IPR2014-00579 and 884. And in the final session, the
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`third session, we will be hearing IPR2014-00570 and 875. For
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`the whole day, we're going to gather one composite transcript,
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`and enter it in each case.
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`I'm just going to remind both parties that if you have
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`any objections, wait until it's your turn to raise the objection. Do
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`not interrupt the opposing party while they're speaking, raise your
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`objections during your own allocated time. For each session,
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`each party will be given 60 minutes. You can allocate the time as
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`you see fit, just remember to identify what case number you're
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`referring to and also identify what slide numbers for
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`demonstratives or exhibit numbers and page numbers for the
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`record, and for the transcript.
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`If nobody has any questions, the burden of proof lies on
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`the Petitioner, and the Petitioner can go ahead and argue first.
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`MR. ANGILERI: Thank you, Your Honor. May it
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`please the Board, my name is Frank Angileri, and in this phase
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`one, I think Mr. Cordell and I talked about this beforehand, we're
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`going to address a couple of some of the global issues at the
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`beginning, some of the claim construction issues, and then also
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`obviously proceed to the two IPRs that are within this particular
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`phase.
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`We're here today to address four patents, and this is the
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`patent family from which these patents arise. They're shown in
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`red. The yellow is -- this is slide 2. The yellow is the other
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`patent that's at issue between the parties right now, but that's not
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`at issue in these hearings today.
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`These four patents, they're a continuation, they're all the
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`same spec, they're in a long chain and early in this chain Paice
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`was focusing on hardware, in these patents, the reason we're here
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`is because these patents attempt to patent old control strategies.
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`The first two, which are in the first two sessions, the '347 and
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`'634 patents focus on operating an engine when the torque
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`required exceeds a setpoint that's above which the engine operates
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`efficiently.
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`The last two patents focus on, that's the '388 and '097
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`patents focus on limiting the rate of change of engine torque. In
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`the '097 patent so that you can maintain a stoichiometric air fuel
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`ratio, and in the '388 patent, limiting the rate of change of engine
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`torque and then add in the motor.
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`In slide 3, we have claim 1 of the '347 and '634 patents,
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`and we have highlighted the control language that's the focus of
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`these patents, and that language is, "starts and operates said
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`engine when torque required to be produced by said engine to
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`propel the vehicle is at least equal to a setpoint above which said
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`engine torque is efficiently produced." This is a very common
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`feature that reoccurs in many claims in these patents. Other
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`claims add limitations about operating the motor when the torque
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`required is below that setpoint. Other claims, this claim uses the
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`language "torque required to be produced by said engine," so
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`required torque. Other claims will use that same "required
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`torque" language, or will use a "road load" language, but the
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`Board has construed road load as the amount of instantaneous
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`torque required to propel the vehicle, be it positive or negative,
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`and that makes those road load claims likewise focus on the
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`required torque.
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`The Board's construction is the top of slide 4, and the
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`reason we consider this a global issue is in virtually all these
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`IPRs, Paice has argued that the prior art does not meet the road
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`load limitations, but all of these prior art references talk about
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`required torque, and required torque is what the claims require
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`either directly in the claim language as shown in claim 1, or
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`through the construction of road load.
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`JUDGE DeFRANCO: Mr. Angileri?
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`MR. ANGILERI: Yes?
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`JUDGE DeFRANCO: Do any of the prior art
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`references use the term "road load?"
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`MR. ANGILERI: I don't know that they use that term.
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`amount of torque required and the references use road load, and
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`that's consistent -- the references use "the amount of torque
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`required." That is consistent with the Paice patent. The
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`construction of road load is consistent with the Paice patent,
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`which defines road load as "the amount of instantaneous torque
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`required to propel a vehicle." And, so, therefore, the fact that the
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`reference -- whether the references use road load is not really
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`significant in our view to whether they disclose the invention of
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`the claims. They disclose required torque, they disclose operating
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`the engine when the required torque is above a torque threshold,
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`which is the focus of the Paice patents.
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`Although the Court's construction -- the Board's
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`construction is required torque, and the references disclose
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`required torque, Paice has consistently argued that these
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`references don't teach road load. The problem with that argument
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`is, number one, the Board's construction does not require
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`anything further on road load, but the Paice patents also don't
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`require anything further in terms of how road load is determined.
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`JUDGE DESHPANDE: Counsel, are you satisfied with
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`the Board's construction of road load?
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`MR. ANGILERI: Yes. Paice has consistently tried to
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`distinguish this art based on how road load is determined. For
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`example, with respect to the Vittone and Caraceni references,
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`Paice has argued that those references determined the drivability
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`torque requirements or the driver torque requests based on the
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`pedal position. Those both have a microprocessor, which
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`interprets that pedal position to determine a torque required at an
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`instant in time, and therefore disclose the Board's road load
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`construction, they disclose the amount of torque required.
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`Paice cannot differentiate this prior art based on how
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`road load is determined in this proceeding because it's not part of
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`the Board's construction, and because the '347 patents and all the
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`patents at issue do not define how road load is determined.
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`In slide 5, we asked Paice's expert, "Does the '347
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`patent explain how you determine road load, or how a person of
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`skill in the art would determine road load?" His answer: "Yeah,
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`that's not -- that's something that wasn't part of the patent." So,
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`any attempt by Paice in these proceedings to distinguish prior art
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`based on how road load is determined, we believe is improper
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`and should have no weight.
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`Likewise, when we asked Mr. Hannemann what factors
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`would one consider to determine road load, in slide 6, on the
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`left-hand side, we have a number of citations to specific groups of
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`features where we asked him are those features sufficient, and he
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`said they were not. He said those are factors one might consider,
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`but those are not sufficient to determine road load.
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`In the quote that we have on the upper right-hand side
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`of page slide 6, we asked him, again, what about a list of factors,
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`we asked him, pedal position, vehicle speed, engine RPM, gear
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`ratio engine vacuum, would those be sufficient? And his
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`response, those are examples of factors that I would consider, but
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`he said he hadn't done the analysis. And finally, we asked him
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`some questions about how could you finally determine whether
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`someone is calculating road load according to the Paice patents,
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`he said it would take a full product development cycle. Needless
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`to say, none of that is in the Paice patents.
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`JUDGE DeFRANCO: So, Mr. Angileri, regardless of
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`what Paice's expert said, is it Petitioner's position that the '347
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`patent does not disclose how road load is determined?
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`MR. ANGILERI: That's correct. It just talks about
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`road load being instantaneous torque to propel the vehicle, and
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`therefore in our view, any prior art that discloses determining the
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`torque required is disclosing the road load of the Paice patents.
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`The second global issue is the setpoint issue, which, again, crops
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`up in many, many petitions. The Board construed setpoint as,
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`and I'm on slide 7 now, "a predetermined torque value that may
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`or may not be reset." That's correct because, first, foremost, the
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`claims, when they reference setpoint, it's done so in the context of
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`a torque value, where a torque is referenced relative to the
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`setpoint to determine, for example, whether the engine should
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`operate. That shows you that the setpoint is a torque value.
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`Separate from that, in the upper right-hand portion of
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`slide 7, we have some excerpts from the deposition of Paice's
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`expert, where he basically said he agreed that independent of the
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`Board's construction, regardless, the setpoint is a torque value in
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`these claims, and he said yes.
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`Paice's proposed construction is a definite but
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`potentially variable value at which a transition between operating
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`modes may occur. We believe that the Board's construction is the
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`correct construction. Paice's construction says it's a definite but
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`potentially variable value, that really doesn't add much definition.
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`And then Paice's construction says at which a transition between
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`operating modes may occur, that means it may not occur. So, we
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`don't think that Paice's construction properly captures the fact that
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`setpoint is a torque value, and it makes it somewhat undefined.
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`I'm now going to proceed, unless the Board has any
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`further questions on these global issues, to the issues that are
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`specific to these two IPRs in this session.
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`JUDGE DeFRANCO: Mr. Angileri, would you agree
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`that a setpoint is a torque value at which a transition occurs?
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`MR. ANGILERI: I think it can occur, I don't think
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`these claims in the broadest reasonable construction require a
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`transition at that setpoint. For example --
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`JUDGE DeFRANCO: Well, what would be the
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`purpose of the setpoint, then?
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`MR. ANGILERI: It defines a range where the engine
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`may operate. The claim, for example, talks about the engine
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`operating when the required torque is between a setpoint and
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`MTO. That claim limitation would be met by a required torque
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`being somewhere in that range. It doesn't necessarily require a
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`specific transition at a particular setpoint. In other words, if the
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`engine is operating in that range, if the prior art teaches the
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`engine operating in that range, above the setpoint, below the
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`MTO, it meets that limitation. Whether it teaches a transition, per
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`se, that would certainly meet the limitation as well, but if the
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`prior art teaches an engine operating when the required torque is
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`above that setpoint and below MTO, it will meet that limitation.
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`So, a transition would certainly meet it, but the claims
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`under the broadest reasonable construction do not necessarily
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`require that transition. In the prior art.
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`JUDGE DeFRANCO: But we have to interpret setpoint
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`consistent with the specification, it seems to me the specification
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`is all about transitions between modes. Would you agree?
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`MR. ANGILERI: It is -- it certainly discusses
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`having multiple setpoints. It discusses situations where one
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`might not operate the engine in that range. I don't think it's
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`necessarily significant to these proceedings, however, because the
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`prior on which we rely does discuss treating the setpoint as a
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`transition point. In other words, for example, the Bumby
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`reference talks about if you're above the torque line, you operate
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`the engine, and if you're below the torque line, you operate the
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`motor. Likewise, the Severinsky '970 patent has that same sort of
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`discussion. So, the prior art discloses the transition feature.
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`Turning to the Severinsky '970, there are three
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`limitations that have gotten a lot of discussion in the parties'
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`papers. They're what we call the motor -- the engine limitation,
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`the motor limitation and the setpoint limitation. We've given
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`them numbers, and we've put up the claim language for claim 23
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`as an example, but these features arise in claim 7 of the '347
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`patent, and claim 16 of the '634 patent. All three of these
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`limitations, we believe, are very clearly disclosed in the
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`Severinsky '970 patent. And we have focused on two provisions,
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`which are on slide 9.
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`The first, which is at column 7, lines 8 to 16, reads,
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`"More particularly, according to the invention," so it's focusing
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`on the invention of the '970 patent. "The internal combustion
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`engine is operated -- there's an "only" there -- "under the most
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`efficient conditions of output power and speed." Now, power,
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`torque and speed, there's a well-known relationship between those
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`three, namely that power is equal to torque times speed.
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`So, a person of skill in the art would understand that a
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`condition of output, power and speed is a torque condition. Any
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`pair of power and speed is going to be a torque value, but
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`Severinsky makes it very clear that they're talking about torque
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`elsewhere.
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`Now, this is the when, there's been a lot of discussion in
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`the briefings about Severinsky '970 not teaching when the engine
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`is operated. This very clearly and expressly states when the
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`engine is operated. Specifically, "When the engine can be used
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`efficiently to drive the vehicle forward, e.g. in highway cruising,
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`it is so employed." So, it's a very definitive statement about when
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`you apply the engine, namely when it's efficient to do so. Or
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`when it would be efficient to do so.
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`The next sentence, "Under other circumstances, e.g. in
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`traffic, the electric motor alone drives the vehicle." So, when it's
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`not efficient for the engine to drive the vehicle, the motor does so.
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`The second paragraph, or the second provision that we
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`focus on is column 20, lines 63 to 67, that's on the bottom of slide
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`9. The first provision talked about driving the engine when it's
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`efficient, the second provision defines when efficiency exists, at
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`least in this example. And it says, again, "It will be appreciated
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`that according to the invention," again, focusing on the invention
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`of the '970 patent, "the internal combustion engine is run only in
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`the near vicinity of its most efficient operational point." So, near
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`vicinity, that suggests a band around that most efficient point, and
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`that band is defined as times when the engine will produce 60 to
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`90 percent of its maximum torque, or MTO, as the parties have
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`talked.
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`JUDGE DeFRANCO: Mr. Angileri, what does
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`maximum torque output mean? Is that the full capacity of the
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`engine?
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`MR. ANGILERI: Well, maximum torque output can be
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`used in different ways. It usually is the maximum torque that the
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`engine can hit at any point in time. There are different maximum
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`torque -- maximum torques that an engine can generate at
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`different speeds. So, persons of skill in the art would understand
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`both of those meanings, if you will. Said another way, if you
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`plotted engine torque versus engine speed, there would be a
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`maximum torque at -- and these are common curves in the art,
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`there would be a maximum torque at which the engine could -- a
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`maximum torque that the engine could generate at a given speed,
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`and that would generally looks like a hill, and then, of course, the
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`center point, which is the highest point, would be the single
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`maximum torque that that engine can generate at a particular
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`speed.
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`JUDGE DeFRANCO: Does maximum torque output
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`change depending on the mode of operation?
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`MR. ANGILERI: No. And to the extent I understand
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`your question, the maximum torque output of the engine wouldn't
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`change, for example, if the motor is running. On the other hand,
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`the maximum torque output of the vehicle would change if you
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`operate the engine and the motor because now you've got two
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`torque sources. So, I'm not sure I understand -- the MTO is sort
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`of a -- it's a maximum value that an engine has, that doesn't
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`change, whether -- that stays the same whether the engine is
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`running, the motor is running or both are running. It's a capacity
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`thing.
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`JUDGE DeFRANCO: I guess what I'm wondering is
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`does the MTO change depending on whether the engine is
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`propelling the vehicle up a hill versus propelling the vehicle on a
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`flat surface?
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`MR. ANGILERI: No.
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`JUDGE DeFRANCO: No.
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`MR. ANGILERI: Because it's an engine capacity. It's
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`what the engine can do at its maximum output.
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`JUDGE DeFRANCO: Okay.
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`MR. ANGILERI: So that maximum doesn't change, it's
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`a question of whether the engine is operating near it or in the case
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`of when you're running in dual mode, the vehicle may be
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`generating more torque than the engine's maximum torque output
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`because it's using the motor to supplement the engine.
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`JUDGE DeFRANCO: Okay. Thank you.
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`MR. ANGILERI: So, back to these two passages. In
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`our view, these passages very clearly define the engine limitation,
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`the motor limitation and the setpoint. They define the engine
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`limitation because it talks about the engine limitation says,
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`employing the engine to propel the vehicle when the required
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`torque to do so is between the lower level setpoint and MTO.
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`Setpoint is the efficiency range. So, the Severinsky '970 patent
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`defines a range of 60 to 90 percent of MTO where you're going to
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`operate the engine, so you've got a lower level setpoint of 60
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`percent and you're defining it and you're running the engine
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`between that setpoint of 60 percent and MTO.
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`Then, '970 says, on your other circumstances, run the
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`motor. That's the motor limitation, 23.7. "Employing said one
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`electric motor to propel said vehicle when the required torque is
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`less than the lower level setpoint." And, finally, the setpoint
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`limitation is met because the setpoint limitation is the point above
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`which the engine operates sufficiently, that's 23.1, and again,
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`Severinsky defines that point as 60 percent of maximum torque.
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`That's the lower end of its efficiency range.
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`Severinsky discloses mode switching based on torque in
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`several other places. On slide 10, we've got some of those
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`reproduced. At column 14, lines 15 to 18, it talks about
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`activating the motor when torque in excess of the capabilities of
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`the engine is required. So, it's focusing on the torque required to
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`decide whether to go into that dual mode electric engine or
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`electric motor and engine. Then on the bottom of slide 10 we
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`have the excerpts from the acceleration and hill-climbing mode.
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`The first portion of this excerpt clarifies that
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`acceleration and hill climbing is a scenario, this is from column
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`14, lines 22 to 25, and column 10, line 63, to 11, line 6. The first
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`portion says that figure 6 illustrates operation of the system in a
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`high-speed acceleration and/or hill-climbing mode, where both
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`the engine and the motor provide torque to the wheels. So, we
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`put that in there just to make it clear that when Severinsky '970
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`uses acceleration or hill climbing, they're talking about using both
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`the engine and the motor at the same time.
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`The next excerpt talks about a situation figure 4 --
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`JUDGE DeFRANCO: Mr. Angileri, I don't mean to
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`interrupt.
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`MR. ANGILERI: Yep.
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`JUDGE DeFRANCO: But I do have a question.
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`Looking at figure 3 of Severinsky, you see a controller there, the
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`microprocessor, and it has various inputs, and some of those
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`inputs are operator commands. Now, you just stated that the
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`switching modes are dependent upon torque, yet the
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`microprocessor controls the switching modes, correct?
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`MR. ANGILERI: Yes.
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`JUDGE DeFRANCO: And when I look at figure 3 of
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`Severinsky, '970, I believe, it shows inputs of operator
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`commands, so that -- and I believe this is Patent Owner's position,
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`that really those switching modes are dependent on driver input,
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`and not necessarily torque values that are detected. So, how do
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`we come to grips with this figure 3 showing input from the driver
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`as opposed to torque?
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`MR. ANGILERI: So, I don't -- I think you can come to
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`grips by -- for several reasons. First, the claims talk about
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`determining road load based on operator command. So, that's a
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`clear example. In column 12 of the '347 patent, there's a
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`discussion of determining road load based on the pedal position
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`and what's happening with the pedal position.
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`JUDGE DeFRANCO: Isn't that really just claim 23?
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`Does claim 1 also speak to driver input?
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`MR. ANGILERI: Well, claim 1, I don't know that that
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`precludes driver input. Claim 1 talks about starting in the
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`operating engine, when the torque required to be produced by the
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`engine to propel the vehicle is above a setpoint. That torque
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`certainly can be determined, based on the operator commands. In
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`fact, that's how cars generally work. The operator communicates
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`to the controller through the pedal that he or she wants more or
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`less torque.
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`So, when you have a microprocessor-based system, the
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`microprocessor is looking at these inputs, like the inputs shown
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`on figure 3, and making a determination of how much torque is
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`required at that time. That is consistent with the specification of
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`the patents at issue, and as discussed earlier, the patents at issue
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`don't define any other way of determining the torque required.
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`So, the figure 3, the inputs of figure 3 are consistent
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`with the '347 patent's teachings on how you determine the torque
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`required. And, in fact, the figure 3 has virtually the same figure,
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`figure 3 of the '970 patent is virtually identical to figure 4 of the
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`'347 patent in terms of the inputs that are shown. And I can put
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`them on the ELMO if you would like to see them.
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`JUDGE DeFRANCO: So, it's Petitioner's position that
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`figure 3 of Severinsky in showing operator commands is simply
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`the operator choosing the torque value?
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`MR. ANGILERI: The operator is choosing torque
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`value in sort of a human sense, right? The operator isn't --
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`JUDGE DeFRANCO: By pressing on the accelerator
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`or --
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`MR. ANGILERI: Yeah, sure. So, the operator isn't --
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`isn't even saying I want more torque, the operator doesn't
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`necessarily know anything about torque or power, of course, but
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`the operator is pushing on the pedal, and the vehicle with the
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`microprocessor, you know, designed by an engineer, is smart
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`enough to know, okay, the operator wants more torque, I'm going
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`to calculate that torque, I'm going to calculate the torque required
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`based on that pedal input, maybe based on -- it may look at other
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`factors, too, which are shown in both figure 3 of the '970 patent
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`and figure 4 of the '347 patent.
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`But again, exactly how it's determined is not -- is not
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`part of the claim, and the '347 patent doesn't teach anything about
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`specifically how that required torque is determined, other than
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`talking about the pedal.
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`Slide 10, just to finish the thought on acceleration and
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`hill climbing, the reason we're focusing on acceleration and hill
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`climbing, there are several reasons. First, on this question of
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`whether Severinsky '970 teaches mode selection based on torque,
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`acceleration and hill climbing is necessarily torque-based,
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`because it arises at any speed, and it requires an increase in torque
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`no matter what speed you're at. But this passage also confirms
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`that '970 is teaching activating the engine when the torque
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`required goes up.
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`In the bottom of slide 10, finishing this -- it talks about
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`at column 10, line 63, through column 11, line 6, this is a scenario
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`where it's talking about operating with just the electric motor in
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`heavy traffic. So, it's a situation where the car isn't accelerating
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`much because you're in heavy traffic. And then, it talks about
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`other combinations of torque and energy required under other
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`circumstances are detailed below in connection with other
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`figures, 5 and 9. And they give one example.
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`So, again, you're in an electric motor-only mode, and
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`then this says, "for example, if the operator continues to
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`command acceleration, an acceleration/hill-climbing mode
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`illustrated in figure 6 may be entered, followed by a highway
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`cruising mode." The reason we put this in there, and we talk
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`about followed by, is this is talking about a scenario where you
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`have the motor only, where you have an increased torque demand
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`from acceleration and hill climbing, and you enter this
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`acceleration and hill-climbing mode, which means you are
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`turning on the engine, because you are going from motor-only
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`mode to hill-climbing mode which means you are going from
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`motor-only mode to motor-plus-engine mode.
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`Severinsky '970 is teaching turning on the engine
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`because the torque required has gone up. And then it says,
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