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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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`R.J. REYNOLDS VAPOR COMPANY,
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`Petitioner
`
`v .
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`FONTEM HOLDINGS 1 B.V.,
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`Patent Owner
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`
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`U.S. Patent 8,893,726
`Issue Date: Nov. 25, 2014
`Title: Electronic Cigarette
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`
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`Inter Partes Review No. 2017-01117
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`
`
`PETITION FOR INTER PARTES REVIEW OF
`U.S. PATENT NO. 8,893,726 PURSUANT TO
`35 U.S.C. §§ 311-319 AND 37 C.F.R. § 42
`
`
`
`

`

`
`
`TABLE OF CONTENTS
`
`Page
`
`TABLE OF AUTHORITIES ................................................................................... iv
`LIST OF EXHIBITS ................................................................................................. v
`I.
`INTRODUCTION .......................................................................................... 1
`II. MANDATORY NOTICES UNDER 37 C.F.R. § 42.8(A)(1) ........................ 2
`A.
`Real Party-in-Interest ........................................................................... 2
`B.
`Related Matters .................................................................................... 2
`1.
`Related Litigations ..................................................................... 2
`2.
`Related Proceedings Before the Board ...................................... 5
`3.
`Pending Applications ................................................................. 6
`Lead and Back-Up Counsel .................................................................. 6
`C.
`Service Information .............................................................................. 7
`D.
`III. GROUNDS FOR STANDING ....................................................................... 7
`IV.
`IDENTIFICATION OF CHALLENGE AND STATEMENT
`OF THE PRECISE RELIEF REQUESTED .................................................. 7
`THRESHOLD REQUIREMENT FOR INTER PARTES
`REVIEW ......................................................................................................... 9
`VI. STATEMENT OF REASONS FOR THE RELIEF
`REQUESTED ................................................................................................. 9
`A.
`Summary of the Argument ................................................................... 9
`B.
`Background of the 726 Patent ............................................................ 10
`1.
`The 726 Patent ......................................................................... 10
`2.
`The Prosecution History of the 726 Patent .............................. 11
`Person of Ordinary Skill in the Art (“PHOSITA”) ............................ 13
`Claim Construction ............................................................................ 14
`1.
`“electronic cigarette” ................................................................ 15
`2.
`“atomizer” ................................................................................ 17
`3.
`“liquid storage body including fiber material” ........................ 17
`
`C.
`D.
`
`V.
`
`i
`
`
`

`

`
`
`2.
`
`F.
`
`E.
`
`“physical contact” .................................................................... 18
`4.
`Patents and Publications Relied on in this Petition ............................ 18
`1.
`Counts (Ex. 1007) Teaches A Liquid Storage Body
`Including Fiber Material In Physical Contact With
`The Atomizer ........................................................................... 18
`Voges (Ex. 1011) and Takeuchi (Ex. 1012)
`Disclose A Sensor In The Stream Passage ............................... 24
`3. White (Ex. 1013) Discloses A Fiber Material .......................... 27
`Ground 1: Claims 15 and 17 Are Anticipated by Counts ................. 28
`1.
`Claim 15 ................................................................................... 29
`a.
`“an electronic cigarette” ................................................ 29
`b.
`“a housing having an inlet and an outlet” ...................... 30
`c.
`“an electronic circuit board and an atomizer
`having a heating element, within the
`housing” ......................................................................... 32
`“a battery electrically connected to the
`electronic circuit board” ................................................ 37
`“a stream passage within the housing
`leading from the inlet to the atomizer” .......................... 40
`“a liquid storage body including fiber
`material in a cylindrical section of the
`housing, with the liquid storage body in
`physical contact with the atomizer” ............................... 42
`“an aerosol passage from the atomizer to the
`outlet” ............................................................................ 45
`Claim 17 ................................................................................... 47
`a.
`“the heating element comprising a wire coil
`in a cavity in the atomizer” ............................................ 47
`G. Ground 2: Claims 15 and 17 Are Unpatentable as
`Obvious over Counts Alone ............................................................... 49
`H. Ground 3: Claims 15 and 17 Are Unpatentable as
`Obvious over Counts Combined with White ..................................... 51
`1. Motivation To Combine Counts With White ........................... 51
`
`d.
`
`e.
`
`f.
`
`g.
`
`2.
`
`ii
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`

`

`
`
`I.
`
`Ground 4: Claim 16 Is Unpatentable as Obvious over
`Counts Combined With Voges and/or Takeuchi ................................ 58
`1. Motivation To Combine Counts With Voges
`and/or Takeuchi ........................................................................ 59
`“a sensor in the stream passage, with the sensor
`electrically linked to the electronic circuit board” ................... 62
`VII. CONCLUSION ............................................................................................ 72
`
`
`2.
`
`
`
`
`
`iii
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`
`

`

`
`
`TABLE OF AUTHORITIES
`
`CASES
`Catalina Mktg. Int'l, Inc. v. Coolsavings.com, Inc.,
`289 F.3d 801 (Fed.Cir.2002) ......................................................................... 15, 16
`Cisco Sys. et al v. Capella Photonics, Inc.,
`IPR2014-01276 (P.T.A.B. Feb. 17, 2016) ........................................................... 16
`Cuozzo Speed Techs. v. Lee,
`579 U. S. ____ (2016) ......................................................................................... 14
`Fontem Ventures B.V. et al v. Nu Mark LLC., No. 2:16-cv-04537
`(C.D. Cal., filed June 22, 2016) ............................................................................. 4
`Google Inc. v. Visual Real Estate, Inc.
`IPR2014-01339 (P.T.A.B. Jan. 25, 2016) ........................................................... 16
`In re Cuozzo Speed Techs., LLC,
`793 F.3d 1268 (Fed. Cir. 2015) ........................................................................... 14
`KSR Int’l v. Co. v. Teleflex Inc.,
`550 U.S. 398 (2007) ............................................................................................ 60
`RF Controls, LLC. v. A1 Packaging Solutions, Inc.
`IPR2014-01536 (P.T.A.B. March 28, 2016) ....................................................... 16
`STATUTES
`35 U.S.C. §§ 102-103 ..................................................................................... 7, 9, 12
`35 U.S.C. §§ 311-319 ................................................................................... 1, 2, 3, 9
`OTHER AUTHORITIES
`Manual of Patent Examining Procedure § 2143 ............................................... 60, 61
`Patent Trial Practice Guide
`77 Fed. Reg., Vol. 77, No. 157 (2012) .................................................................. 2
`REGULATIONS
`37 C.F.R. § 42 ............................................................................................... 1, 2, 7, 8
`
`
`iv
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`

`

`
`
`LIST OF EXHIBITS
`
`Exhibit No.
`
`Exhibit
`
`U.S. Patent No. 8,893,726
`
`Exhibit
`1001:
`Exhibit
`1002:
`Exhibit
`1003:
`Exhibit
`1004:
`Exhibit
`1005:
`
`Exhibit
`1006:
`
`Exhibit
`1007:
`Exhibit
`1008:
`Exhibit
`1009:
`Exhibit
`1010:
`
`Exhibit
`1011:
`Exhibit
`1012:
`Exhibit
`1013:
`Exhibit
`
`Referred To In
`The Petition As
`“726 Patent”
`
`726 Patent File History, Non-Final
`Rejection (August 16, 2013)
`726 Patent File History, Amendment
`(October 8, 2013)
`726 Patent File History, Notice of
`Allowance (August 18, 2014)
`NJOY, Inc. v. Fontem Holdings 1 B.V.,
`IPR2015-01302 (PTAB, filed May 29,
`2015), Paper No. 15
`R.J. Reynolds Vapor Company v. Fontem
`Holdings 1 B.V., IPR2016-01270 (PTAB,
`filed July 2, 2016), Paper No. 11
`U.S. Patent No. 5,144,962
`
`U.S. Patent No. 4,981,522
`
`“Non-Final
`Rejection”
`“Amendment”
`
`“Notice of
`Allowance”
`“Prior NJOY
`Decision”
`
`“Prior Reynolds
`Decision”
`
`“Counts”
`
`“Nichols”
`
`Declaration of Robert Sturges, Ph.D.
`
`“Sturges Decl.”
`
`NJOY, Inc. v. Fontem Holdings 1 B.V.,
`IPR2015-01302 (PTAB, filed May 29,
`2015), Paper No. 6
`U.S. Pat. No. 5,894,841
`
`“Patent Owner
`Preliminary
`Response”
`“Voges”
`
`U.S. Patent No. 6,155,268
`
`U.S. Patent No. 5,129,409
`
`U.S. Patent No. 1,016,844
`
`v
`
`
`“ Takeuchi”
`
`“ White”
`
`“Moonelis”
`
`

`

`
`
`1014:
`Exhibit
`1015:
`Exhibit
`1016:
`Exhibit
`1017:
`Exhibit
`1018:
`Exhibit
`1019:
`Exhibit
`1020:
`Exhibit
`1021:
`Exhibit
`1022:
`
`
`
`U.S. Patent No. 3,385,303
`
`“ Hind”
`
`U.S. Patent No. 3,428,053
`
`“Schoenbaum”
`
`U.S. Patent No. 3,860,012
`
`U.S. Patent No. 4,270,552
`
`U.S. Patent No. 4,589,428
`
`U.S. Patent No. 5,745,985
`
`U.S. Patent No. 4,208,005
`
`Excerpt from James W. Dally, Packaging
`of Electronic Systems: A Mechanical
`Engineering Approach (1990)
`
`“ Selke”
`
`“ Jenkins”
`
`“Keritsis”
`
`“Ghosh”
`
`“Nate”
`
`“Dally”
`
`vi
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`

`

`
`
`I.
`
`
`
`INTRODUCTION
`
`
`
`Pursuant to 35 U.S.C. §§ 311-319 and 37 C.F.R. § 42, R.J. Reynolds Vapor
`
`Company (“Reynolds” or “Petitioner”) respectfully requests Inter Partes Review
`
`(“IPR”) of claims 15-17 of U.S. Patent No. 8,893,726 to Hon, titled “Electronic
`
`Cigarette” (“the 726 Patent,” Ex. 1001), which is currently assigned to Fontem
`
`Holdings 1 B.V. (“Fontem” or “Patent Owner”). Petitioner authorizes the Patent
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`and Trademark Office to charge Deposit Account No. 23-1925 for the fees set
`
`forth in 37 C.F.R. § 42.15(a) for this Petition for IPR, and further authorizes
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`payment of any additional fees to be charged to this Deposit Account.
`
`This Petition demonstrates a reasonable likelihood that claims 15-17 of the
`
`726 Patent are unpatentable. As discussed herein, U.S. Patent No. 5,144,962
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`(Counts) discloses every limitation of claims 15 and 17. In addition, claims 15 and
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`17 are obvious in view of Counts alone or in combination with U.S. Patent No.
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`5,129,409 (White). Claim 16 is also obvious over Counts in view of Voges and/or
`
`Takeuchi. Counts discloses use of a sensor as recited in claim 16. It was well-
`
`known in the art to position a sensor in the stream passage of an electronic
`
`cigarette, as required by claim 16. See Voges (U.S. Pat. No. 5,894,841) and
`
`Takeuchi (U.S. Patent No. 6,155,268). Based upon the teachings of Counts, Voges
`
`and/or Takeuchi, it would have been obvious to include a sensor in the stream
`
`

`

`
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`passage of Counts to achieve the predicted result of sensing when the user takes a
`
`draw from the cigarette.
`
`II. MANDATORY NOTICES UNDER 37 C.F.R. § 42.8(A)(1)
`A. Real Party-in-Interest
`For purposes of 35 U.S.C. § 312(a)(2) and 37 C.F.R. § 42.8(b)(1) only,
`
`Petitioner, R.J. Reynolds Vapor Company, identifies the real parties-in-interest as
`
`R.J. Reynolds Vapor Company, R.J. Reynolds Tobacco Company, and RAI
`
`Services Company. R.J. Reynolds Vapor Company further discloses that it is a
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`wholly owned, indirect subsidiary of Reynolds American Inc. Although Petitioner
`
`does not believe that Reynolds American Inc. is a real party-in-interest (see Patent
`
`Trial Practice Guide 77 Fed. Reg., Vol. 77, No. 157 (2012) at 48759-60), Reynolds
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`American Inc. and its wholly owned subsidiaries (direct and indirect) nevertheless
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`agree to be bound by any final written decision in these proceedings to the same
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`extent as a real party-in-interest. See 35 U.S.C. § 315(e).
`
`B. Related Matters
`Petitioner is not aware of any reexamination certificates or pending
`
`prosecution concerning the 726 Patent.
`
`Related Litigations
`
`1.
`Petitioner is a defendant in the following litigation involving the 726 Patent:
`
`Fontem Ventures B.V. et al. v. R.J. Reynolds Vapor Company, No. 1:16-cv-01255
`
`2
`
`

`

`
`
`(M.D.N.C., filed April 4, 2016). Fontem alleges that Reynolds infringes claims
`
`15-17 of the 726 Patent, the claims for which Reynolds seeks inter partes review.
`
`In addition to the 726 Patent, Fontem has also asserted U.S. Patent Nos. 8,365,742;
`
`8,490,628; 8,899,239; 9,326,548; 9,326,549; and 9,370,205 against Reynolds in the
`
`above-referenced district court action. Reynolds was served with the complaint
`
`asserting the 726 Patent on April 6, 2016. Thus, Reynolds’ petition is timely under
`
`35 U.S.C. § 315(b).
`
`In addition to the petitions noted below with respect to the patents in the
`
`same family as the 726 Patent, the current petitioner has also filed petitions for IPR
`
`with respect to U.S. Patent Nos. 8,365,742; 8,899,239; and 9,326,548.
`
`The Patent Owner has also asserted the 726 Patent in the following
`
`additional district court proceedings in which Reynolds was not and is not a party:
`
`a) Fontem Ventures B.V. et al. v. Nu Mark LLC, No. 1:16-cv-01261 (M.D.N.C.,
`filed April 4, 2016)) (terminated);
`b) Fontem Ventures BV et al v. NJOY, Inc., No. 2-14-cv-08144 (C.D. Cal., filed
`October 21, 2014) (terminated);
`c) Fontem Ventures B.V. et al v. LOEC, Inc. et al., No. 2-14-cv-08149, (C.D.
`Cal., filed October 21, 2014) (terminated);
`d) Fontem Ventures BV et al v. CB Distributors, Inc. et al., No. 2-14-cv-08154
`(C.D. Cal., filed October 21, 2014) (terminated);
`e) Fontem Ventures BV et al v. Vapor Corp., No. 2-14-cv-08155 (C.D. Cal.,
`filed October 21, 2014) (terminated);
`f) Fontem Ventures BV et al v. FIN Branding Group, LLC et al., No. 2-14-cv-
`08156 (C.D. Cal., filed October 21, 2014) (terminated);
`
`3
`
`

`

`
`
`g) Fontem Ventures BV et al v. Ballantyne Brands, LLC, No. 2-14-cv-08157
`(C.D. Cal., filed October 21, 2014) (terminated);
`h) Fontem Ventures BV et al v. Spark Industries, LLC, No. 2-14-cv-08158
`(C.D. Cal., filed October 21, 2014) (terminated);
`i) Fontem Ventures BV et al v. Logic Technology Development, LLC, No. 2-
`14-cv-08160 (C.D. Cal., filed October 21, 2014) (terminated);
`j) Fontem Ventures BV et al v. VMR Products, LLC d/b/a V2CIGS, No. 2-14-
`cv-08161 (C.D. Cal., filed October 21, 2014) (terminated).
`
`In addition, the Patent Owner or its predecessors-in-interest has asserted the
`
`‘410, ‘331, ‘628, and/or ‘549 patents, all of which issued from the same family as
`
`the 726 Patent, in the following additional district court proceedings in which
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`Reynolds was not and is not a party:
`
`a) Fontem Ventures B.V. et al v. Nu Mark LLC., No. 1:16-cv-01259 (M.D.N.C.,
`filed June 22, 2016)) (terminated);
`b) Fontem Ventures BV et al v. NJOY, Inc., No. 2-14-cv-01645 (C.D. Cal., filed
`March 5, 2014) (terminated);
`c) Fontem Ventures B.V. et al v. LOEC, Inc. et al., No. 2-14-cv-01648, (C.D.
`Cal., filed March 5, 2014) (terminated);
`d) Fontem Ventures BV et al v. CB Distributors, Inc. et al., No. 2-14-cv-01649
`(C.D. Cal., filed March 5, 2014) (terminated);
`e) Fontem Ventures BV et al v. Vapor Corp., No. 2-14-cv-01650 (C.D. Cal.,
`filed March 5, 2014) (terminated);
`f) Fontem Ventures BV et al v. FIN Branding Group, LLC et al., No. 2-14-cv-
`01651 (C.D. Cal., filed March 5, 2014) (terminated);
`g) Fontem Ventures BV et al v. Ballantyne Brands, LLC, No. 2-14-cv-01652
`(C.D. Cal., filed March 5, 2014) (terminated);
`h) Fontem Ventures BV et al v. Spark Industries, LLC, No. 2-14-cv-01653
`(C.D. Cal., filed March 5, 2014) (terminated);
`
`4
`
`

`

`
`
`i) Fontem Ventures BV et al v. Logic Technology Development, LLC, No. 2-
`14-cv-01654 (C.D. Cal., filed March 5, 2014) (terminated);
`j) Fontem Ventures BV et al v. VMR Products, LLC d/b/a V2CIGS, No. 2-14-
`cv-01655 (C.D. Cal., filed March 5, 2014) (terminated);
`k) Ruyan Investment Holdings Limited v. Vapor Corp., et. al., No. 2-11-cv-
`06268 (C.D. Cal., filed July 29, 2011) (terminated);
`l) Ruyan Investment Holdings Limited v. Smoking Everywhere, Inc., et. al., 2-
`11-cv-00367 (C.D. Cal., filed January 12, 2011) (terminated).
`2.
`As noted below, Petitioner previously filed a request for inter partes review
`
`Related Proceedings Before the Board
`
`with respect to the 726 Patent on July 2, 2016, which was assigned IPR2016-01270
`
`(see item (d) below). That petition relied upon different prior art than the current
`
`petition. In a decision (Paper No. 11) dated January 4, 2017, the Board denied the
`
`petition. Petitioner identifies the following related inter partes review proceedings
`
`and administrative matters:
`
`a) NJOY, Inc. v. Fontem Holdings 1 B.V., IPR2015-01302 (PTAB, filed May
`29, 2015) (requesting inter partes review of U.S. Pat. No. 8,893,726)
`b) Nu Mark LLC v. Fontem Holdings 1 B.V., IPR2016-01288 (PTAB, filed
`June 28, 2016) (requesting inter partes review of U.S. Pat. No. 8,893,726)
`c) Nu Mark LLC v. Fontem Holdings 1 B.V., IPR2016-01297 (PTAB, filed
`June 28, 2016) (requesting inter partes review of U.S. Pat. No. 8,893,726).
`d) R.J. Reynolds Vapor Company v. Fontem Holdings 1 B.V., IPR2016-01270
`(PTAB, filed July 2, 2016) (requesting inter partes review of U.S. Pat. No.
`8,893,726).
`e) NJOY, Inc. v. Fontem Holdings 1 B.V.,. IPR2014-01289 (PTAB, filed
`August 14, 2014) (requesting inter partes review of U.S. Pat. No.
`8,393,331).
`
`5
`
`

`

`
`
`f) Nu Mark LLC v. Fontem Holdings 1 B.V., IPR2016-01299 (PTAB, filed
`June 28, 2016) (requesting inter partes review of U.S. Pat. No. 8,393,331).
`g) Nu Mark LLC v. Fontem Holdings 1 B.V., IPR2016-01438 (PTAB, filed July
`14, 2016) (requesting inter partes review of U.S. Pat. No. 8,393,331).
`h) NJOY, Inc. v. Fontem Holdings 1 B.V., IPR2014-01300 (PTAB, filed August
`15, 2014) (requesting inter partes review of U.S. Pat. No. 8,490,628).
`i) Nu Mark LLC v. Fontem Holdings 1 B.V., IPR2016-01283 (PTAB, filed
`June 28, 2016) (requesting inter partes review of U.S. Pat. No. 8,490,628).
`j) Nu Mark LLC v. Fontem Holdings 1 B.V., IPR2016-01285 (PTAB, filed
`June 28, 2016) (requesting inter partes review of U.S. Pat. No. 8,490,628).
`k) R.J. Reynolds Vapor Company v. Fontem Holdings 1 B.V., IPR2016-01527
`(PTAB, filed August 3, 2016) (requesting inter partes review of U.S. Pat.
`No. 8,490,628).
`l) Nu Mark LLC v. Fontem Holdings 1 B.V., IPR2016-01664 (PTAB, filed
`August 22, 2016) (requesting inter partes review of U.S. Pat. No.
`9,326,549).
`m) R.J. Reynolds Vapor Company v. Fontem Holdings 1 B.V., IPR2016-01859
`(PTAB, filed September 23, 2016) (requesting inter partes review of U.S.
`Pat. No. 9,326,549).
`3.
`
`Pending Applications
`
`Two pending patent applications claim the benefit of common parent U.S.
`
`Pat. No. 8,893,726: U.S. Patent Appl. Nos. 14/525,066 and 15/167,825.
`
`C. Lead and Back-Up Counsel
`Lead Counsel
`Back-Up Counsel
`Ralph J. Gabric
`Robert Mallin
`Reg. No. 34,167
`Reg. No. 35,596
`rgabric@brinksgilson.com
`rmallin@brinksgilson.com
`
`
`Brinks Gilson & Lione
`Brinks Gilson & Lione
`Suite 3600 NBC Tower
`Suite 3600 NBC Tower
`
`6
`
`

`

`
`
`
`
`455 Cityfront Plaza Drive
`Chicago IL 60611-5599
`T: 312-321-4200, F: 312-321-4299
`
`
`455 Cityfront Plaza Drive
`Chicago IL 60611-5599
`T: 312-321-4200, F: 312-321-4299
`Mircea Tipescu
`Reg. No. 53,690
`mtipescu@brinksgilson.com
`
`Brinks Gilson & Lione
`Suite 3600 NBC Tower
`455 Cityfront Plaza Drive
`Chicago IL 60611-5599
`T: 312-321-4200, F: 312-321-4299
`
`Service Information
`
`D.
`Please address all correspondence to the lead and backup counsel at the
`
`contact information above. Petitioner also consents to service by email at
`
`rgabric@brinksgilson.com, rmallin@brinksgilson.com and
`
`mtipescu@brinksgilson.com.
`
`III. GROUNDS FOR STANDING
`
`As required by 37 C.F.R. § 42.104(a), Petitioner certifies that the 726 Patent
`
`is available for inter partes review and that Petitioner is not barred or estopped
`
`from requesting inter partes review on the grounds identified herein.
`
`IV.
`
`IDENTIFICATION OF CHALLENGE AND STATEMENT OF THE
`PRECISE RELIEF REQUESTED
`
`Petitioner requests inter partes review and cancellation of claims 15-17 of
`
`the 726 Patent pursuant to 35 U.S.C. §§ 102 and/or 103 as set forth herein. The
`
`726 Patent is to be reviewed under pre-AIA §§ 102 and 103. Petitioner’s detailed
`
`7
`
`

`

`
`
`statement of the reasons for relief requested is set forth below in the section titled
`
`“Statement of Reasons for the Relief Requested.” In accordance with 37 C.F.R. §
`
`42.6(c), copies of the exhibits are filed herewith. In addition, the Petition is
`
`accompanied by the Declaration of Dr. Robert Sturges. Ex. 1009.
`
`Claims 15-17 are unpatentable based upon the following grounds:
`
`Ground 1: Claims 15 and 17 are anticipated by Counts.
`
`Ground 2: Claims 15 and 17 are obvious over Counts alone.
`
`Ground 3: Claims 15 and 17 are obvious over Counts in combination with
`
`White.
`
`Ground 4: Claim 16 is obvious based on any of Grounds 1-3 above and
`
`further in combination with Voges and/or Takeuchi.
`
`Statement of Non-Redundancy: Grounds 1-4 are not redundant of each
`
`other. As identified above, Ground 1 is based on anticipation by Counts; Ground 2
`
`is based on obviousness by Counts alone; Ground 3 is based on Counts in view of
`
`White; and Count 4 is directed to claim 16.
`
`Additionally, the grounds presented in this petition are not redundant of
`
`grounds previously before the PTO. All of the grounds rely on the prior art
`
`electronic cigarette disclosed in Counts. Although Counts is listed on the face of
`
`the 726 Patent, Counts was not substantively addressed during prosecution of the
`
`726 Patent.
`
`8
`
`

`

`
`
`As noted above, Petitioner previously filed a petition for inter partes review
`
`of claims 15-16 of the 726 Patent based on Brooks (U.S. Patent No. 4,947,874) as
`
`the primary reference (IPR2016-01270). The Board denied institution of that prior
`
`petition on January 4, 2017. The present Petition seeks review of claims 15-17
`
`based on different prior art.
`
`V. THRESHOLD REQUIREMENT FOR INTER PARTES REVIEW
`This petition meets the threshold requirements for inter partes review
`
`because it establishes that there is “a reasonable likelihood that the petitioner [will]
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`prevail with respect to at least 1 of the claims challenged in the petition.” 35
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`U.S.C. § 314(a).
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`VI. STATEMENT OF REASONS FOR THE RELIEF REQUESTED
`A.
`Summary of the Argument
`Claims 15-17 of the 726 Patent are invalid under 35 U.S.C. §§ 102 and/or
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`103. Specifically, Counts (Ex. 1007) anticipates claims 15 and 17 under 35 U.S.C.
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`§ 102(b). Claims 15 and 17 are also obvious under 35 U.S.C. § 103(a) over Counts
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`alone and/or in combination with White. In addition, claim 16 is obvious under 35
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`U.S.C. § 103(a) over Counts alone and/or in combination with White and further in
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`combination with Voges (Ex. 1011) and/or Takeuchi (Ex. 1012).
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`9
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`B.
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`Background of the 726 Patent
`1.
`As illustrated in FIG. 1 reproduced below, the 726 Patent describes a
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`The 726 Patent
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`structure having a shell 14 and a battery 2, an electronic circuit board 3, a sensor 6,
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`an atomizer 9, and a liquid-supplying bottle 11 within the shell 14. Ex. 1001 at
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`2:37-40. An air inlet 4 is also provided on the external wall of the shell 14 and a
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`mouthpiece 15 is provided at one end of the shell. Id. at 2:36-37.
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`
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`electronic
`circuit board
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`battery
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`air inlet
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`mouthpiece
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`sensor
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`atomizer
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`bottle
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`shell
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`
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` Ex.1001 at Fig. 1 (annotated)
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`
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`The 726 Patent also describes that “a solution storage porous body 28 is
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`provided in the liquid-supplying bottle [11], and can be filled with polypropylene
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`fiber, terylene fiber or nylon fiber.” Id. at 3:11-15; Fig. 11.
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`10
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`
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`solution storage
`porous body
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`Ex.1001 at Fig. 11 (annotated)
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`
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`The solution storage porous body 28 is in contact with the atomizer 9 to supply
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`liquid nicotine solution to the atomizer. Id. at 3:64-67.
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`When a user inhales, air enters through the air inlet 4, passes through an air
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`passage 18 of the sensor and flows into an atomization cavity 10 of the atomizer 9.
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`Id. at 3:49-52. This drives a nicotine solution from a porous body that surrounds
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`the atomization cavity into the atomization cavity. Id. at 3:52-59. It also causes
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`the sensor 6 to output a signal to the electronic circuit board 3, which actuates a
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`heating element 26 of the atomizer 9 to atomize the nicotine solution. Id. at 3:27-
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`43. After the atomization, small droplets of the nicotine solution form aerosols,
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`which are sucked out via an aerosol passage 12, gas vent 17 and mouthpiece 15.
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`Id. at 3:59-64.
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`The Prosecution History of the 726 Patent
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`2.
`The 726 Patent issued from application serial no. 13/777,927 filed on
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`February 26, 2013, and claims priority to Chinese application CN 2004 0031182
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`11
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`
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`filed on April 14, 2004. In the first Office Action dated August 16, 2013, the
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`Examiner rejected application claims 16-18, which correspond to issued claims 15-
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`17, under 35 U.S.C. § 102(b) as anticipated by Brooks (U.S. Patent No. 4,947,874).
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`Ex. 1002 at p. 3-6. However, the Examiner indicated that application claim 19,
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`which depended from application claim 16, contained allowable subject matter,
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`namely, “a liquid supply comprising fibers.” Id. at p. 5.
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`In a Response dated October 8, 2013, the Applicant argued that Brooks
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`failed to disclose a liquid supply that is a “separately identifiable element” from
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`heating element 18. Ex. 1003 at p. 6. Applicant also amended application claim
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`16 to include, inter alia, subject matter from application claim 19:
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`Ex. 1003 at p. 4.
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`12
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`
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`The Examiner subsequently issued a Notice of Allowance on August 18,
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`2014. Ex. 1004. The Notice of Allowance included an examiner's amendment to
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`the “liquid supply” element of application claim 16 as follows: “a liquid storage
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`body including fiber material supply comprising fibers in a cylindrical section of
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`the housing, with the liquid storage body supply in physical contact with the
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`atomizer.” Id. at p. 7. The Examiner’s amendment also canceled claims 20-23.
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`Id. The Examiner also provided reasons for allowance, stating “[t]he closest prior
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`art of record fails to teach or reasonably suggest an electronic cigarette having the
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`claimed structure, specifically that which comprises a heating wire in the atomizer
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`surrounded by a porous body/atomizer in contact with a liquid storage body, or that
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`which comprises a liquid storage body including fiber material.” Id.
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`As discussed below, Counts discloses what the Examiner believed was
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`missing from the “closest prior art.” Counts discloses, inter alia, an electronic
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`cigarette comprising an atomizer in contact with a liquid storage body including
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`fiber material.
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`Person of Ordinary Skill in the Art (“PHOSITA”)
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`C.
`A PHOSITA is a hypothetical person who is presumed to know the relevant
`
`prior art. A PHOSITA for the 726 Patent would have had at least the equivalent of
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`a Bachelor’s degree in electrical engineering, mechanical engineering, or
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`biomedical engineering or related fields, along with at least 5 years of experience
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`13
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`
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`designing electromechanical devices, including those involving circuits, fluid
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`mechanics and heat transfer. Ex. 1009 at ¶¶ 30-31.
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`D. Claim Construction
`Pursuant to 37 C.F.R. § 42.100(b), a claim in an unexpired patent is given its
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`broadest reasonable construction in light of the specification in which it appears.
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`In re Cuozzo Speed Techs., LLC, 793 F.3d 1268, 1278-79 (Fed. Cir. 2015), aff’d
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`Cuozzo Speed Techs. v. Lee, 579 U. S. ____ (2016). Petitioner submits that the
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`limitations below require construction, and for the purpose of this inter partes
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`review only, that the remaining claim terms take on their ordinary and customary
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`meaning that the terms would have to a PHOSITA in view of the 726 Patent
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`specification. Petitioner’s construction of claim terms is not binding upon
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`Petitioner in any other proceeding related to the 726 Patent, and Petitioner reserves
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`the right to offer additional or alternative construction under the Phillips standard
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`applicable in the co-pending district court litigation.
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`In the prior institution decisions (IPR2015-01302 (Paper No. 15) and
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`IPR2016-01270 (Paper No. 11)) denying institution of inter partes review of the
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`726 Patent, the Board construed two terms that appear in claims 15-17. Ex. 1005
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`at 8-10; Ex. 1006 at 6-8. These terms are addressed below.
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`14
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`
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`“electronic cigarette”
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`1.
`The term “electronic cigarette” is only found in the preamble of claim 15
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`(and claims 16 and 17 by virtue of their dependency from claim 15). In IPR2015-
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`01302, the parties did not dispute whether the preamble of claim 15 is a claim
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`limitation, and instead submitted competing constructions for the “electronic
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`cigarette.” The Board largely adopted the Patent Owner’s proposed construction,
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`interpreting “electronic cigarette” as “a device for generating liquid droplets for
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`inhalation by a user, where the device functions as a substitute for smoking, e.g.,
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`by providing nicotine without tar.” Ex. 1005 at 8-9. For the reasons discussed
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`below, Petitioner does not agree that “electronic cigarette” is a claim limitation that
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`requires construction.
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`In general, a preamble limits the invention if it recites essential structure or
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`steps, or if it is “necessary to give life, meaning, and vitality” to the claim.
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`Catalina Mktg. Int'l, Inc. v. Coolsavings.com, Inc., 289 F.3d 801, 808
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`(Fed.Cir.2002). Conversely, a preamble is not limiting “where a patentee defines a
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`structurally complete invention in the claim body and uses the preamble only to
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`state a purpose or intended use for the invention.” Id. While there is no litmus test
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`for determining when a preamble operates as a limitation, courts have provided
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`certain “guideposts” or examples of circumstances in which a preamble may
`
`establish a claim limitation. These circumstances include when: (1) the “Jepson”
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`15
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`form is used for a claim; (2) the preamble is “essential to understand the limitations
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`or terms in the claim body” (e.g. when a preamble phrase provides the antecedent
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`basis for other terms in the claim body); (3) the preamble recites “additional
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`structure or steps underscored as important by the specification”; and (4) a patentee
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`clearly relies on the preamble during prosecution to distinguish the claimed
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`invention from the prior art. Id. None of those circumstances are applicable here.
`
`First, none of the challenged claims are in Jepson format. Second, the
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`preamble language for an electronic cigarette is not essential to understand the
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`claim. The language is not used in the body of the claim, and the alleged invention
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`is fully defined by the claim limitations that follow the preamble. Ex. 1009 at ¶ 35;
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`see also Google Inc. v. Visual Real Estate, Inc. IPR2014-01339, Final Written
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`Decision, Paper 39, pp. 9-11 (P.T.A.B. Jan. 25, 2016) (preamble language “a
`
`system including a video and data server farm” was not a limitation); Cisco Sys. et
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`al v. Capella Photonics, Inc., IPR2014-01276, Final Written Decision, Paper 40, p.
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`18 (P.T.A.B. Feb. 17, 2016) (“servo-based” used in the preamble was not a
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`limitation); RF Controls, LLC. v. A1 Packaging Solutions, Inc. IPR2014-01536,
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`Final Written Decision, Paper 20, p. 11 (P.T.A.B. March 28, 2016) (preamble
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`language reciting “an inventory tracking system for use in . . . an inventory
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`tracking region” was not a limitation).
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`16
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`
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`Nonetheless, even if the Board’s prior construction of “electronic cigarette”
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`is adopted (and it should not be), Petitioner contends that claims 15-17 are invalid
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`for the reasons set forth herein. Ex. 1009 at ¶ 36.
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`2.
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`“atomizer”
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`The parties in IPR2015-01302 submitted competing constructions for the
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`term “atomizer.” The Board sided with petitioner NJOY and construed “atomizer”
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`as “a part of the electronic cigarette that includes components that participate in
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`facilitating atomization.” Ex. 1005 at 9-10. Petitioner notes that the Patent Owner
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`previously acknowledged in IPR2015-01302 that “atomization” means “converting
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`liquid into aerosol or vapor.” Ex. 1010 at 20. Using the Patent Owner’s definition
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`of “atomization,” Petitioner adopts the B