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`UNITED STATES PATENT AND TRADEMARK OFFICE
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`____________
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`____________
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`MICRO LABS LIMITED AND MICRO LABS USA INC.
`Petitioners,
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`v.
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`SANTEN PHARMACEUTICAL CO., LTD. AND ASAHI GLASS CO., LTD.
`Patent Owners.
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`____________
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`Case IPR2017-01434
`U.S. Patent No. 5,886,035
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`____________
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`PATENT OWNERS' REPLY IN FURTHER SUPPORT OF THEIR
`MOTION TO EXCLUDE EVIDENCE
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`Case IPR2017-01434
`US Patent No. 5,886,035
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`I. Petitioners' Incorporation by Reference Is Improper .......................................... 1
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`TABLE OF CONTENTS
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`II. Testimony and Exhibits Not Cited in the Reply Should Be Excluded ............... 4
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`III. Petitioners Mischaracterize Patent Owners' Argument ....................................... 5
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`Patent Owners Santen Pharmaceutical Co., Ltd. and Asahi Glass Co., Ltd.
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`Case IPR2017-01434
`US Patent No. 5,886,035
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`(together, "Patent Owners") submit this Reply in further support of their Motion to
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`Exclude Evidence (Paper No. 32) ("Motion").
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`Petitioners' Incorporation by Reference Is Improper
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`I.
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`Petitioners' attempt to label the 102 pages of Reply expert testimony as
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`proper "evidence" and not improper "argument" is specious. See Opp'n at 1.
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`Notably, Petitioners do not meaningfully dispute that their Reply is replete with
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`conclusory arguments with citations to large portions of the expert declarations.
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`See id. at 4-10. Petitioners merely argue (incorrectly) that such practice is
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`permitted. But as the Board has repeatedly held, reliance on expert declarations to
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`support conclusory statements in a Petition or Reply amounts to incorporation by
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`reference and is prohibited.
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`The Board's informative decision in Cisco is directly on point. Cisco Sys.,
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`Inc.v. C-Cation Techs., LLC, IPR2014-00454, Paper 12 (PTAB Aug. 29, 2014)
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`(informative). There, petitioner followed a conclusory paragraph in its petition
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`with a citation to "one and a half pages" of its expert's declaration "indicating the
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`combinations would have been 'well within the ordinary creativity of a person of
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`ordinary skill in the art' and providing reasons why one would have combined the
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`teachings of the references." Id. at 9. The Board found such reliance improper and
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`expressly held that the "practice of citing the Declaration to support conclusory
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`1
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`US Patent No. 5,886,035
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`statements that are not otherwise supported in the Petition [] amounts to
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`incorporation by reference" in violation of 37 C.F.R. § 42.6(a)(3). 1 Id. Indeed,
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`PTAB's Trial Practice Guide Update issued this month expressly cites to Cisco and
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`warns that "parties that incorporate expert testimony by reference in their . . .
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`replies without providing explanation of such testimony risk having the testimony
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`not considered by the Board." Trial Practice Guide Update at 4.
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`Numerous decisions have reached the same conclusion. See e.g., S.S.
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`Steiner, Inc. v. John I Haas, Inc., IPR2014-01490, Paper 7 at 16 (P.T.A.B. Mar. 16,
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`2015) (holding petitioner's reliance "on large portions of Dr. Leedle's Declaration
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`to support otherwise conclusory statements" amounted to improper incorporation
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`by reference); Apple Inc. v. ContentGuard Holdings, Inc., IPR2015-00452, Paper 9
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`at 9 (P.T.A.B. July 13, 2015) ("Arguments and information that are not presented
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`and developed in the Petition, and instead are incorporated by reference to the
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`Sherman Declaration, are not entitled to consideration."); DirectTV, LLC, v. Qurio
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`1
` Petitioners' attempts to distinguish Cisco and Conopco fall flat. Opp'n at 3-4.
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`Cisco is clearly on point for the reasons above. Conopco makes no distinction
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`between expert "evidence" and "argument." The Board specifically held that it
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`would not consider "information presented in a supporting declaration, but not
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`discussed in a petition[.]" Conopco, Inc. v. Procter & Gamble Co., IPR2013-
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`00510, Paper 9 at 8 (P.T.A.B. Feb. 12, 2014) (emphasis added).
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`2
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`Holdings, Inc., IPR2015-02006, Paper 6 at 10 (P.T.A.B. Apr. 4, 2016) ("The
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`Petition's practice of citing multiple pages of the Dr. Lavian Declaration to support
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`conclusory statements and to expand its thin analysis . . . amounts to incorporation
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`by reference—which is impermissible under our rules.").
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`Tellingly, Petitioners' sole support for their "evidence" and "argument"
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`distinction consists of a single decision from 2013. See Research in Motion Corp.
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`v. Multimedia Ideas LLC, IPR 2013-00036, Paper 15 (P.T.A.B. Mar. 18, 2013).
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`That decision in no way stands for the sweeping proposition that a petitioner is
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`permitted to rely on swathes of argumentative expert opinions not found in the
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`Reply. Indeed, the opposite is true. The Board specifically held: "The factual
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`portions of the declaration, if identified with sufficient specificity, must be
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`considered, and argumentative portions, together with the unidentified factual
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`portions, need not be considered." Id. at 7 (emphasis added). Petitioners
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`strategically omitted that language in quoting the Board, no doubt because they
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`deemed it unhelpful to their position. Moreover, as discussed above, more recent
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`Board decisions, including the informative decision by the Board in Cisco, have
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`unequivocally held that reliance on expert testimony to support otherwise
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`conclusory statements in substantive papers is not permitted.2
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`2 Petitioners are wrong that Patent Owners' objections failed to comply with Rule
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`42.64(b)(1). Opp'n at 1-2. It is undisputed that Patent Owners timely objected,
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`3
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`US Patent No. 5,886,035
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`Petitioners boldly claim that "all of Petitioners' arguments are made in their
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`Reply." Opp'n at 4. That is not even remotely accurate. Petitioners' 102-page
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`expert declarations are rife with arguments not found in the 23-page Reply. As
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`detailed in Patent Owners' Motion, a particularly egregious example is Petitioners'
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`citation to 26 paragraphs of the deLong declaration (¶¶ 46-70, 76) spanning 21
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`pages to support a one-sentence contention in their Reply that "[t]he POSA would
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`have reasonably expected [modifying the C-15 hydroxyl group with fluorine] to
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`successfully result in a compound with an improved therapeutic profile." Motion
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`at 6-7. Those paragraphs and pages consist of a wide array of arguments not found
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`in the Reply, including new arguments based on exhibits and figures not even cited
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`– much less discussed – in the Petition or Reply, i.e., Exs. 1047-1052.
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`II. Testimony and Exhibits Not Cited in the Reply Should Be Excluded
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`There is no dispute that the Reply did not cite or discuss the testimony and
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`exhibits identified by Patent Owners in their Motion. Motion at 10-13.
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`Nevertheless, Petitioners argue that their reliance on such testimony and exhibits is
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`proper because their exclusion would purportedly "belie[] the Board's practice and
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`common sense." Opp'n at 12. But as detailed above, reference to expert testimony
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`to support conclusory statements is not permitted. That prohibition applies a
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`and as discussed in the Motion, Petitioners' incorporation by reference was
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`pervasive (rather than an isolated deficiency).
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`4
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`US Patent No. 5,886,035
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`fortiori to testimony and exhibits not even referenced in the Reply. Further,
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`reliance on such un-cited testimony and exhibits runs afoul of the particularity and
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`specificity requirement for supporting evidence. See 37 C.F.R. § 42.104(b)(5).3
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`Moreover, because it is improper to incorporate by reference expert declaration
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`testimony to support otherwise unsupported arguments, the fact that the exhibits
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`were discussed or cited by Petitioners' experts is irrelevant.4 Opp'n at 13.
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`III. Petitioners Mischaracterize Patent Owners' Argument
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`Petitioners argue that Patent Owners' Motion is an improper and untimely
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`objection to Petitioners' non-compliance with the word count limit. Opp'n at 14-
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`15. Petitioners attack a straw man. That is not Patent Owners' argument. Patent
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`Owners instead argue that expert declaration testimony and exhibits improperly
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`incorporated by reference or not cited in Petitioners' Reply should be excluded for
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`the reasons set forth above.
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`3 Petitioners' contention that the Rule does not apply to a reply is baseless. See
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`Packers Plus Energy Servs. Inc. v. Baker Hughes Oilfield Operations., LLC,
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`IPR2016-01003, Paper 33 at 25-26 (P.T.A.B. Nov. 6, 2017) (applying Rule
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`42.104(b)(5) to a reply).
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`4
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` Exs. 1037 and 1051 were not cited in the Reply. Petitioners cannot cure that
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`deficiency by filing Ex. 1063 and 1064.
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`5
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`Dated: August 16, 2018
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`Case IPR2017-01434
`US Patent No. 5,886,035
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`/ Arlene L. Chow /
`Arlene L. Chow
`Registration No. 47,489
`Eric J. Lobenfeld
`(pro hac vice)
`Ernest Yakob
`Registration No. 45,893
`Hogan Lovells US LLP
`875 Third Avenue
`New York, New York 10022
`Telephone: (212) 918-3000
`Fax: (212) 918-3100
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`Counsel for Patent Owners
`Santen Pharmaceutical Co., Ltd.
`and Asahi Glass Co., Ltd.
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`6
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`Case IPR2017-01434
`US Patent No. 5,886,035
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`CERTIFICATE OF SERVICE
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`The undersigned hereby certifies that a copy of the foregoing Patent Owners'
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`Reply in Support of Their Motion to Exclude Evidence was served on August 16,
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`2018, by filing this document through the Patent Trial and Appeal Board End to
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`End System as well as delivering a copy via electronic mail upon the following
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`attorneys of record for the Petitioners:
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`Cedric C.Y. Tan, Reg. No. 56,082
`H. Keeto Sabharwal (pro hac vice)
`Yun Wei, Reg. No. 70,744
`Alton L. Hare, Reg. No. 68, 638
`PILLSBURY WINTHROP SHAW PITTMAN LLP
`1200 Seventeenth Street, NW
`Washington, DC 20036
`Tel.: (202) 663-8000
`Fax.: (202) 663-8007
`Email: cedric.tan@pillsburylaw.com
`Email: keeto.sabharwal@pillsburylaw.com
`Email: sophie.wei@pillsburylaw.com
`Email: alton.hare@pillsburylaw.com
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`Sean M. Weinman, Reg. No. 69,515
`PILLSBURY WINTHROP SHAW PITTMAN LLP
`1650 Tysons Boulevard, 14th Floor
`McLean, VA 22102
`Tel.: (703) 770-7511
`Fax.: (703) 770-4856
`Email: sean.weinman@pillsburylaw.com
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`MicroLabsIPR@pillsburylaw.com
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`Dated: August 16, 2018
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`Case IPR2017-01434
`US Patent No. 5,886,035
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`/ Arlene L. Chow /
`Arlene L. Chow
`Registration No. 47,489
`Hogan Lovells US LLP
`875 Third Avenue
`New York, New York 10022
`Telephone: (212) 918-3000
`Fax: (212) 918-3100
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`Counsel for Patent Owners
`Santen Pharmaceutical Co., Ltd.
`and Asahi Glass Co., Ltd.
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`8
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