`By: Terry A. Saad (tsaad@bcpc-law.com)
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`Jeffrey R. Bragalone (jbragalone@bcpc-law.com)
`Daniel F. Olejko (dolejko@bcpc-law.com)
`Nicholas C. Kliewer (nkliewer@bcpc-law.com)
`Bragalone Conroy PC
`2200 Ross Ave.
`Suite 4500 – West
`Dallas, TX 75201
`Tel: 214.785.6670
`Fax: 214.786.6680
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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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`ZTE CORPORATION and ZTE (USA), Inc.,
`Petitioners,
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`v.
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`CELLULAR COMMUNICATIONS EQUIPMENT LLC,
`Patent Owner.
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`Case IPR2017-01079
`U.S. Patent No. 8,457,676
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`PATENT OWNER’S PRELIMINARY RESPONSE
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`Mail Stop PATENT BOARD
`Patent Trial and Appeal Board
`U.S. Patent & Trademark Office
`P.O. Box 1450
`Alexandria, Virginia 22313-1450
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`Case IPR2017-01079
`Patent 8,457,676
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`TABLE OF CONTENTS
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`I. INTRODUCTION ................................................................................................. 2
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`II. BACKGROUND ................................................................................................... 2
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` Status of Related Litigation .............................................................. 2
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` Status of Related IPRs ...................................................................... 4
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`III. ARGUMENTS AND AUTHORITIES .............................................................. 4
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` The Petition should be denied because it was not timely filed, thus
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`institution is barred by 35 U.S.C. § 315(b). ..................................... 4
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` The Petition should be denied because it is cumulative of a prior
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`office proceeding. ............................................................................. 9
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`IV. CONCLUSION .................................................................................................11
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`1
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`Case IPR2017-01079
`Patent 8,457,676
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`I.
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`INTRODUCTION
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`Patent Owner Cellular Communications Equipment LLC (“CCE” or “Patent
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`Owner”) hereby files this Preliminary Response (“Preliminary Response”) to the
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`Petition (Paper 1) (the “Petition”) for Inter Partes Review of U.S. Patent No.
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`8,457,676 (Ex. 1001) (the “’676 Patent”) in IPR2017-01079 filed by ZTE
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`Corporation and ZTE (USA), Inc. (collectively, “ZTE” or “Petitioners”).
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`The Petitioners’ challenge to the ’676 Patent claims should be rejected
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`because (1) the Petition is time-barred under 35 U.S.C. § 315(b) and (2) the Petition
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`is cumulative of a prior office proceeding under 35 U.S.C. § 325(d).
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`This Preliminary Response is timely under 35 U.S.C. § 313 and 37 C.F.R. §§
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`1.7, 42.107(b), as it is filed on the next business day following three months from
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`the April 10, 2017 mailing date of the Notice of Filing Date Accorded to Petition
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`and Time for Filing Patent Owner Preliminary Response. Paper 6. For purposes of
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`this Preliminary Response, Patent Owner has limited its identification of deficiencies
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`in the Petition and does not intend to waive any arguments not addressed in this
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`Preliminary Response.
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`II. BACKGROUND
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` Status of Related Litigation
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`The ’676 patent is currently subject to the following district court litigations:
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` Cellular Communications Equipment LLC v. AT&T Inc., et al., 2:15-
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`Patent 8,457,676
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`cv-00576 (E.D. Tex.) (all claims and issues pertaining to the ’676 patent
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`are currently stayed pending a decision in IPR2016-1493);
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` Cellular Commc’ns Equipment LLC v. Sprint Corp. et al., 2:15-cv-
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`00579 (E.D. Tex.) (all claims and issues pertaining to the ’676 patent
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`are currently stayed pending a decision in IPR2016-1493);
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` Cellular Commc’ns Equipment LLC v. T-Mobile USA, Inc. et al., 2:15-
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`cv-00580 (E.D. Tex.) (all claims and issues pertaining to the ’676 patent
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`are currently stayed pending a decision in IPR2016-1493);
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` Cellular Commc’ns Equipment LLC v. Verizon Commc’ns, Inc. et al.,
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`2:15-cv-00581 (E.D. Tex.) (all claims and issues pertaining to the ’676
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`patent are currently stayed pending a decision in IPR2016-1493);
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` Cellular Commc’ns Equipment LLC v. HTC Corporation, et al., 2:17-
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`cv-00078 (E.D. Tex.), filed January 25, 2017; and
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` Cellular Commc’ns Equipment LLC v. ZTE Corporation, et al., 2:17-
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`cv-00079 (E.D. Tex.), filed January 25, 2017.
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`CCE filed its first complaint alleging infringement of the ’676 patent against
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`ZTE, among other parties, on April 30, 2015. Cellular Commc’ns Equipment LLC
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`v. AT&T Inc., et al., 2:15-cv-00576, Dkt. No. 1 (E.D. Tex. April 30, 2015). See Ex.
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`2001. ZTE (USA) Inc. was served with the amended complaint on July 28, 2015 and
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`also entered an appearance in the litigation on August 11, 2015. See Ex. 2002.
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`3
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` Status of Related IPRs
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`The ’676 patent is currently the subject of two other pending IPR proceedings:
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`(1) the IPR2016-01501 (the “HTC IPR”) to which Petitioners seek joinder and (2)
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`IPR2016-01493, filed by Apple Inc. (the “Apple IPR”). On February 13, 2017, a
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`decision instituting inter partes review of claims 1, 19, and 33 (but denying
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`institution on claims 3, 21, or 34) was entered in the HTC IPR (Paper 7, IPR2016-
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`01501) based on one ground of obviousness involving U.S. Patent Application
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`Publication No. 2006/0140154 to Kwak (“Kwak”). Also on February 13, 2017, a
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`decision instituting inter partes review of claims 1, 3, 19, and 21 was entered in the
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`Apple IPR (Paper 7, IPR2016-01493) based on obviousness grounds involving U.S.
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`Patent Application Publication No. 2004/0223455 to Fong (“Fong”), R2-052744,
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`“Filtering For UE Power Headroom Measurement,” 3GPP RAN WG2 #49 Meeting,
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`Seoul, Korea, November 2, 2005 (“Ericsson”), and U.S. Patent No. 6,445,917 to
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`Bark (“Bark”).
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`III. ARGUMENTS AND AUTHORITIES
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` The Petition should be denied because it was not timely filed, thus
`institution is barred by 35 U.S.C. § 315(b).
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`By statute, the Petition was not timely filed and it may not be instituted for
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`trial. Congress set forth the one-year statutory time-bar for IPR petitions as follows
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`in § 315(b):
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`An inter partes review may not be instituted if the petition requesting
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`the proceeding is filed more than 1 year after the date on which the
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`petition, real party in interest, or privy of the petitioner is served with a
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`complaint alleging infringement of the patent. The time limitation set
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`forth in the preceding sentence shall not apply to a request for joinder
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`under subsection (c).
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`35 U.S.C. § 315(b).
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`Petitioners do not dispute that they filed the Petition more than one year after
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`they were served with a complaint for infringement of the ’676 patent. See Motion,
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`Paper 3 at 2-3. CCE filed its first complaint alleging infringement of the ’676 patent
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`against ZTE, among other parties, on April 30, 2015. Cellular Commc’ns Equipment
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`LLC v. AT&T Inc., et al., 2:15-cv-00576, Dkt. No. 1 (E.D. Tex. April 30, 2015). See
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`Ex. 2001. ZTE (USA) Inc. was served with the amended complaint on July 28, 2015
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`and also entered an appearance in the litigation on August 11, 2015. See Ex. 2002.
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`Petitioners filed this Petition on March 13, 2017—more than eighteen months after
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`ZTE was served with CCE’s complaints for infringement of the ’676 patent. See
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`Petition, Paper 1.
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`For this reason, the Petition is not proper, and the Board may not institute a
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`trial in this case. See 35 U.S.C. §315(b) (“An inter partes review may not be
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`instituted if the petition requesting the proceeding is filed more than 1 year after the
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`date on which the petitioner … is served with a complaint alleging infringement of
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`the patent.”) and 35 U.S.C. §311(a) (stating that all petitions are “[s]ubject to the
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`provisions of this chapter,” thus including the timeliness requirement of §315(b)).
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`ZTE contends that the §315(b) time-bar does not apply because Petitioners
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`also filed a Motion for Joinder request to be joined as parties to the HTC IPR, which
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`has been instituted for trial. See Motion, Paper 3 at 4 (“This bar does not apply to a
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`request for joinder.”).
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`But Petitioners’ Motion for Joinder does not exempt their Petition from the
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`time-bar of §315(b). This is apparent from the plain language of the statute. The
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`second sentence of §315(b) does not state that the filing of a request for joinder
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`makes the time-bar itself (from the first sentence) inapplicable to a particular
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`petition. Instead, by its plain language, the statute merely states that the one-year
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`limitations period “shall not apply to a request for joinder . . . .” 35 U.S.C. §315(b)
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`(emphasis added). In other words, a petitioner who has timely filed an IPR petition
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`may request joinder to another proceeding after the one-year deadline for filing a
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`petition, and such a request for joinder would not be precluded by the §315(b) one-
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`year deadline. The plain language of the statute simply does not state that a request
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`for joinder suspends the time-bar for the filing of a petition.
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`Patent Owner’s reading of §315(b) is reinforced by the language of §315(c),
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`in at least two ways. First, §315(c) grants the Director the authority and discretion
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`to join parties to an instituted IPR case, but only for “any person who properly files
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`a petition under section 311.” See 35 U.S.C. 315(c) (emphasis added). Section 311(a)
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`states that IPR petitions are “[s]ubject to the provisions of this chapter . . .”, and thus
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`incorporates by reference all of the statutory requirements for a proper IPR petition,
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`including the timeliness requirement of §315(b). In other words, a party who did not
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`timely file its own IPR petition did not “properly file” its petition, and therefore is
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`not eligible for joinder at all under §315(c).
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`Second, §315(c) states that the Director may join a party to an instituted case
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`only after the Director has first determined that the petition filed by the party seeking
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`joinder should itself be instituted for a full IPR trial. See 35 U.S.C. §315(c)
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`(precluding the Director from deciding the joinder issue until after a preliminary
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`response has been filed to the petition filed by the party seeking joinder, and
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`permitting joinder only if the Director first “determines [that the petition] warrants
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`the institution of an inter partes review under section 314”). Prior to joinder, the
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`Director would have no authority or discretion to institute a petition that was filed
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`more than one year after the petitioner had been served with a complaint alleging
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`infringement of the patent. See 35 U.S.C. §315(b). The second sentence of §315(b)
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`makes the time-bar inapplicable to the request for joinder; but the statutory language
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`does nothing to alter or affect the institution decision which, according to §315(c),
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`must be made as a prerequisite before joinder can even be considered. In making the
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`institution decision, §315(b) very plainly states that a time-barred petition “may not
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`be instituted . . . .” 35 U.S.C. §315(b).1
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`The USPTO and the Board are required to comply with all applicable statutory
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`mandates, and no discretion is afforded to the USPTO’s interpretation of statutes
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`that are plain and unambiguous. See City of Arlington, Texas, et al. v. Federal
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`Communications Commission et al., 133 S. Ct. at 1870-71 (2013) (“[T]he question
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`in every case is, simply, whether the statutory text forecloses the agency’s assertion
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`1 Patent Owner is aware that the Board’s regulations governing IPR practice may be
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`read as contrary to Patent Owner’s interpretation of the §315(b) time-bar. See 37
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`C.F.R. §42.122(b) (“The time period set forth in §42.101(b) shall not apply when
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`the petition is accompanied by a request for joinder”). Patent Owner respectfully
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`contends that the §42.122(b) is not a valid regulation because it is contrary to the
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`statutory mandate of §315(b), for the reasons previously discussed. Accordingly,
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`Patent Owner respectfully contends that §42.122(b) is not a valid exercise of the
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`USPTO’s statutory rulemaking authority. See City of Arlington v. FCC, 133 S.Ct.
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`1863, 1869 (2013) (“[F]or agencies charged with administering congressional
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`statutes . . . [b]oth their power to act and how they are to act is authoritatively
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`prescribed by Congress, so that when they act improperly, no less than when they
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`act beyond their jurisdiction, what they do is ultra vires”). Patent Owner is unaware
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`of any judicial decision that has endorsed or affirmed the time-bar waiver in
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`§42.122(b) as a valid exercise of the USPTO’s administrative rulemaking authority,
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`or that has found the final sentence of §42.122(b) to be consistent with the language
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`of §315(b). Nor is Patent Owner aware of any judicial decision that has expressly
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`affirmed the Board’s waiver of the §315(b) time bar when an otherwise time-barred
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`petitioner files a motion for joinder with the petition.
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`of authority, or not”). Patent Owner respectfully urges the Board to apply the plain
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`language of §315(b) in this case, as it is required to do.
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`ZTE chose not to file an IPR petition during the statutory one-year period
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`from service of the complaint. ZTE, instead, took a “wait and see” approach to the
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`IPR process, and sat on its own right to file an IPR petition for more than eighteen
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`months after being served with a complaint for patent infringement of the ’676
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`patent. ZTE should not be permitted to circumvent the requirement to timely submit
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`a petition following service of a complaint asserting infringement of the ’676 patent.
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`Because Petitioners failed to meet the statutory requirements for filing a petition
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`after service of a complaint, ZTE’s Petition should be denied as untimely. 35 U.S.C.
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`§315(b).
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`The Petition should be denied because it is cumulative of a prior
`office proceeding.
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`Petitioner admits that the Petition “is substantively identical to the HTC IPR
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`petition, only differing in that it omits the proposed rejections by HTC that were not
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`instituted by the PTAB.” Motion for Joinder, Paper 3 at 1. Under Section 325(d), the
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`Board should deny petitions that challenge a patent based on previously-rejected
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`grounds and cumulative and duplicative art, otherwise petitioners will be given an
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`unwarranted and unfair procedural advantage in pending infringement litigation. See
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`35 U.S.C. § 325(d).
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`In determining whether to institute or order a proceeding under this
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`Patent 8,457,676
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`chapter, chapter 30, or chapter 31, the Director may take into account
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`whether, and reject the petition or request because, the same or
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`substantially the same prior art or arguments previously were presented
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`to the Office.
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`35 U.S.C. § 325(d). Under Section 325(d), the Board should deny petitions
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`that challenge a patent based on previously presented grounds and cumulative and
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`duplicative art, otherwise petitioners may be given an unwarranted and unfair
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`procedural advantage in pending infringement litigation. See 35 U.S.C. § 325(d);
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`See also, Unified Patents Inc. v. PersonalWeb Technologies, LLC, et al., IPR2014-
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`00702, Paper 13 at 2, 7-8 (denying a petition and motion for joinder in view of
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`previous IPR petitions filed by third parties citing the same prior art references). The
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`legislative history of Section 325(d) confirms that this is also what Congress
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`intended: Section 325(d) “allows the Patent Office to reject any request for a
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`proceeding, including a request for ex parte reexamination, if the same or
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`substantially the same prior art or arguments previously were presented to the Office
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`with respect to that patent.” 157 Cong. Rec. S1042 (daily ed. Mar. 1, 2011)
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`(Statement of Sen. Kyl).
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`Here, there is no dispute that the same grounds and art are the subject of a
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`previously presented proceeding to the USPTO—namely, the HTC IPR. See Motion
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`for Joinder, Paper 3 at 1. Thus, the Petition should be denied joinder and denied
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`institution under 35 U.S.C. §325(d).
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`IV. CONCLUSION
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`For the foregoing reasons, the Board should deny institution on all grounds of
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`the Petition.
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`Dated: July 10, 2017
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`Respectfully submitted,
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`________________________
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`Terry A. Saad (Reg. No. 62,492)
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`Attorney for Patent Owner
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`Bragalone Conroy PC
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`2200 Ross Ave.
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`Suite 4500 – West
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`Dallas, TX 75201
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`CERTIFICATE OF SERVICE
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`The undersigned hereby certifies that this document has been served via
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`electronic mail on July 10, 2017, to Petitioner at following email addresses pursuant
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`to its consent in its Petition at pp. 3-4: steve.moore@pillsburylaw.com,
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`brian.nash@pillsburylaw.com, and rene.mai@pillsburylaw.com, with a courtesy
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`copy to docket_ip@pillsburylaw.com.
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`________________________
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`Terry A. Saad (Reg. No. 62,492)
`Attorney for Patent Owner
`Bragalone Conroy PC
`2200 Ross Ave.
`Suite 4500 – West
`Dallas, TX 75201
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`CERTIFICATE OF COMPLIANCE
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`As required by 37 C.F.R. § 42.24, the undersigned hereby certifies that the
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`foregoing Preliminary Response contains 2223 words, excluding those portions
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`identified in 37 C.F.R. § 42.24(a)(1), as measured by the word-processing system
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`used to prepare this paper.
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`________________________
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`Terry A. Saad (Reg. No. 62,492)
`Attorney for Patent Owner
`Bragalone Conroy PC
`2200 Ross Ave.
`Suite 4500 – West
`Dallas, TX 75201
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