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`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`DELL INC.; EMC CORPORATION; HEWLETT-PACKARD
`ENTERPRISE CO.; HP ENTERPRISE SERVICES, LLC; TERADATA
`OPERATIONS, INC.; and VERITAS TECHNOLOGIES, LLC,
`Petitioner,
`
`v.
`
`REALTIME DATA LLC,
`Patent Owner.
`____________
`
`Case IPR2017-00176 (Patent 7,161,506 C2)
`Case IPR2017-00179 (Patent 9,054,728 B2)
`Case IPR2017-00806 (Patent 7,161,506 C2)
`Case IPR2017-00808 (Patent 9,054,728 B2)
`____________
`
`Record of Oral Hearing
`Held: February 20, 2018
`____________
`
`
`
`
`
`Before JASON J. CHUNG, SCOTT C. MOORE, SHEILA F.
`McSHANE, and KAMRAN JIVANI, Administrative Patent Judges.
`
`
`
`
`
`
`
`

`

`Case IPR2017-00176 (Patent 7,161,506 C2)1
`Case IPR2017-00179 (Patent 9,054,728 B2)2
`Case IPR2017-00806 (Patent 7,161,506 C2)1
`Case IPR2017-00808 (Patent 9,054,728 B2)2
`
`
`APPEARANCES:
`
`ON BEHALF OF THE PETITIONER:
`
`
`MICHAEL WOODS, ESQUIRE
`ANDREW R. SOMMER, ESQUIRE
`Winston & Strawn, LLP
`1700 K Street, N.W.
`Washington, D.C. 20006
`
`ON BEHALF OF PATENT OWNER:
`
`
`KAYVAN B. NOROOZI, ESQUIRE
`Noroozi, P.C.
`1299 Ocean Avenue
`Suite 450
`Santa Monica, California 90401
`
`
`
`The above-entitled matter came on for hearing on Tuesday,
`February 20, 2018, commencing at 2:38 p.m., at the U.S. Patent and
`Trademark Office, 600 Dulany Street, Alexandria, Virginia.
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`

`

`Case IPR2017-00176 (Patent 7,161,506 C2)1
`Case IPR2017-00179 (Patent 9,054,728 B2)2
`Case IPR2017-00806 (Patent 7,161,506 C2)1
`Case IPR2017-00808 (Patent 9,054,728 B2)2
`
`
`
`P R O C E E D I N G S
`- - - - -
`JUDGE CHUNG: We are convened for the consolidated
`hearing of IPR2017-00176, which has been consolidated with
`IPR2017-00806, and joined with IPR2017-01688. The judges for that
`panel consist of Judges Scott Moore and Sheila McShane and I. The
`other three cases in this consolidated hearing are IPR2017-00179, which
`has been consolidated with IPR2017-00808 and has been joined with
`IPR2017-01690. The panel for those three cases consists of Judges Scott
`Moore and Kamran Jivani and I. The presence of four judges here is not
`an indication of an expanded panel. The judges will be presiding on
`cases only as noted.
`Because three of my colleagues are joining remotely, we
`respectfully request counsel for each side to speak clearly into the
`microphone and identify the slide number that they are referring to. To
`the extent that petitioner wants to use the ELMO projection device,
`please keep in mind that there's a chance that the remote judges cannot
`see what you are referring to on the ELMO device and to please speak
`clearly and describe clearly what you are referencing in the ELMO
`device.
`
`As for objections, we want the free flow of conversation of each
`party, so to the extent that each party has an objection, please preserve
`them until it is their time to speak.
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`Case IPR2017-00176 (Patent 7,161,506 C2)1
`Case IPR2017-00179 (Patent 9,054,728 B2)2
`Case IPR2017-00806 (Patent 7,161,506 C2)1
`Case IPR2017-00808 (Patent 9,054,728 B2)2
`
`
`At this time, will petitioner please identify themselves?
`MR. SOMMER: Thank you, Your Honor. Andrew Sommer on
`behalf of petitioners.
`JUDGE CHUNG: Patent owner?
`MR. NOROOZI: Kayvan Noroozi on behalf of Realtime Data.
`JUDGE CHUNG: Thank you. Each party will have
`45 minutes to present their arguments. And because petitioner has the
`burden, petitioner will go first. Petitioner has the option of reserving
`some rebuttal time which will be taken away from -- which will be part
`of their 45 minutes total. At this time, does petitioner know how much
`rebuttal time they would like to reserve?
`MR. SOMMER: Yes, Your Honor, we would like to reserve
`18 minutes for rebuttal.
`JUDGE CHUNG: Thank you. Because there is no timer on the
`wall, I will let petitioner know when they have a few minutes left and I
`will also do the same for patent owner. Because petitioner reserved
`18 minutes of rebuttal time, I set the timer for 27 minutes. At this time,
`petitioner, you may begin.
`MR. SOMMER: Thank you, Your Honor. Can all the remote
`judges hear me?
`JUDGE JIVANI: Yes, please proceed.
`JUDGE McSHANE: Yes, we can.
`MR. SOMMER: May it please the Board, Andrew Sommer on
`behalf of petitioner. Today we are going to be discussing two patents,
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`Case IPR2017-00176 (Patent 7,161,506 C2)1
`Case IPR2017-00179 (Patent 9,054,728 B2)2
`Case IPR2017-00806 (Patent 7,161,506 C2)1
`Case IPR2017-00808 (Patent 9,054,728 B2)2
`
`the '506 and the '728 patent. And both share a very common
`specification. I think they are identical but for some of the formalities of
`cross-referencing the related applications. And there are some slight
`differences in the claims, some of which matter in these proceedings.
`And we'll talk about those in a bit.
`So here are the topics that I would like to cover today here in
`our argument. This is slide 2. And the first thing I would like to do is
`give a brief overview of the '506 and '728 patents. No doubt Your
`Honors are familiar with the disclosure and the claims of this particular
`patent. So I will be expeditious.
`Then, I will give an overview of Franaszek, Hsu and Sebastian
`and the relevant teachings of these references with respect to the
`invalidity arguments that are presented in the petition and explained
`further in the reply.
`Finally, I'll conclude about giving our explanation about why
`the evidence in this proceeding establishes that the challenged claims are
`obvious over the prior art.
`So turning to slide 3, we have here Figures 13A and 13B of the
`challenged patents, and it's identical between the two. What happens
`here is a data stream is received by this compression device, and after
`some buffering and some counting of the blocks, there's a decision made.
`It looks at the content of this data and it determines whether it recognizes
`it or not. And if the system recognizes the content of the data, it sends it
`into the branch called content-dependent encoders. And the idea in the
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`Case IPR2017-00176 (Patent 7,161,506 C2)1
`Case IPR2017-00179 (Patent 9,054,728 B2)2
`Case IPR2017-00806 (Patent 7,161,506 C2)1
`Case IPR2017-00808 (Patent 9,054,728 B2)2
`
`patent is that if you know the type of data, then you can better tailor the
`compression techniques to the data type, and so you have these
`content-independent encoders. And if you don't recognize the type of the
`data in the data stream, you feed it into what they call
`content-independent encoders. The claims variously refer to these as a
`default or single encoder in certain circumstances. We don't see the
`phrase "content-independent encoding" in the claims at issue in this
`proceeding.
`So the prior art, turning to slide 4, the primary prior art
`reference that we are relying on is a reference to Franaszek. And
`Franaszek teaches a system in which you look at the data stream, you
`determine if you can understand the type of the data in the stream and
`then you compress it using either a default compression technique or a
`compression technique that is tailored to the data type if it's available.
`Skipping to slide 6, we see this process flow. And this process
`flow it appears in a few places in the record in addition to Franaszek
`itself. This is Figure 4A. And here is an exemplary process flow of what
`is described in Franaszek. It looks to see if the data type is available.
`And in the context of the Franaszek reference, this is a data type that is
`written into a field in the block itself. It's labeled 205 in Figure 2 of the
`patent. And we can see that on slide 5. And if the type is not available
`for that particular block, what Franaszek will do is it sends it to a default
`set of compressors. It does not sample to determine which of the default
`is the best and then will compress that using a single or a default
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`Case IPR2017-00176 (Patent 7,161,506 C2)1
`Case IPR2017-00179 (Patent 9,054,728 B2)2
`Case IPR2017-00806 (Patent 7,161,506 C2)1
`Case IPR2017-00808 (Patent 9,054,728 B2)2
`
`compressor for that particular data block. If Franaszek sees that the data
`type for that block is available, then it will select a list of compression
`techniques that is tailored to that data block just like the patents-in-suit.
`And it will then compress that data block according to these tailored
`compression techniques.
`So the claims at issue here require looking to something other
`than a descriptor. And I don't think that the parties dispute that Franaszek
`is looking at a descriptor. In fact, that was a point that was made when
`these claims, at least, in the '506 patent were allowed in the first place.
`Franaszek is different because Franaszek is only looking at a descriptor
`to determine data type.
`So the question that we submit the Board needs to resolve in
`this proceeding is would it have been obvious to look at something other
`than solely a descriptor in the context of these claims such that the claims
`would have been obvious? And we submit that the evidence shows that
`it absolutely would have been. And the primary teaching that we rely on
`in this regard is Hsu. Hsu teaches a system that looks at something other
`than a descriptor to compress what they call heterogeneous files. And
`Hsu identifies this problem in the prior art. He says, well, sometimes
`files have diverse data types within them. And we could have audio and
`we could have images and text, and those are all going to be compressed
`using different compression algorithms that are optimized for those types.
`And so what we take is the string of data, the data stream, and we
`determine a compression plan for that stream by looking at each block
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`Case IPR2017-00176 (Patent 7,161,506 C2)1
`Case IPR2017-00179 (Patent 9,054,728 B2)2
`Case IPR2017-00806 (Patent 7,161,506 C2)1
`Case IPR2017-00808 (Patent 9,054,728 B2)2
`
`and saying which way or which way should I compress this particular
`data block? What compression technique should I use? And it
`determines metrics and types.
`Now, the metrics deal with the statistical properties of the data.
`The data type is based on an analysis of discrete portions of each block
`and it tries to categorize it into these predetermined sequences. So Hsu
`will then look at the contents of that data block to determine the data type
`and these metrics. And he does that because he recognizes that each type
`is slightly different. Each type is expressed in a different way. So I'm
`going to look at the contents of the data. And in case the contents of the
`data changes within a particular block, he uses a majority vote to try to
`determine what is the optimal compression for this particular block. And
`the results that he reports are an improvement over using a generic
`compressor for the entire file.
`JUDGE CHUNG: Counselor, can you point to us the testimony
`from Dr. Creusere that says that you would only use Hsu's teaching with
`the decision to -- when you recognize that type of block in your
`Franaszek reference and to not use it when you don't recognize it? So
`stated differently, could you point to us the best testimony from
`Dr. Creusere that says that you would only use Hsu for the if yes branch
`and not for the if no branch?
`MR. SOMMER: So we submit that that is the legal conclusion
`of obviousness in this case. And I'll answer your question directly. Dr.
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`Case IPR2017-00176 (Patent 7,161,506 C2)1
`Case IPR2017-00179 (Patent 9,054,728 B2)2
`Case IPR2017-00806 (Patent 7,161,506 C2)1
`Case IPR2017-00808 (Patent 9,054,728 B2)2
`
`Creusere does not say in any of his testimony, no, you shouldn't use Hsu
`when you go down the default branch.
`JUDGE CHUNG: So he makes no mention of that in the
`
`record?
`
`MR. SOMMER: Not that I'm aware of. Certainly not in his
`direct testimony. He does not say do not use Hsu to go down the default
`branch in Franaszek. Now, it's our position that that doesn't matter. And
`the reason that it doesn't matter is because there are numerous facts in the
`record that support that conclusion, the legal conclusion of obviousness
`as to whether the claimed subject matter would have been obvious based
`on the testimony of record.
`JUDGE CHUNG: Are any of those facts in the record
`supported by Dr. Creusere's testimony?
`MR. SOMMER: I'm sorry?
`JUDGE CHUNG: You are saying that there's numerous facts
`in the record that support your position that you would only use it for the
`if yes branch but you would omit the teachings of the Hsu reference for
`the if no branch. Are any of those facts in the record, are they supported
`by Dr. Creusere?
`MR. SOMMER: Well, the conclusion is not supported by
`Dr. Creusere's testimony directly, if that's your question, Your Honor.
`Does he come out and say you would not use Hsu going down the default
`branch --
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`Case IPR2017-00176 (Patent 7,161,506 C2)1
`Case IPR2017-00179 (Patent 9,054,728 B2)2
`Case IPR2017-00806 (Patent 7,161,506 C2)1
`Case IPR2017-00808 (Patent 9,054,728 B2)2
`
`
`JUDGE MOORE: Counselor, one moment, please. It sounds
`like your microphone is turned off. I'm unable to hear you.
`JUDGE CHUNG: Off the record.
`(Discussion off the record.)
`JUDGE CHUNG: Let me repeat the question for the benefit of
`my fellow panel members. My question was, is there any testimony on
`the record that says that you would only use the teachings of Hsu for the
`if yes branch of Franaszek but you would omit the teachings of Hsu for
`the if no branch of Franaszek? Is there any testimony from Dr. Creusere?
`MR. SOMMER: On that particular issue he doesn't say that
`expressly. What we do submit is that there are facts of record --
`JUDGE CHUNG: You just said a few seconds ago that he did
`not say that, that he doesn't say it at all. I'm not sure if my fellow panel
`members heard that, but right now you are saying that he doesn't say it
`expressly?
`MR. SOMMER: He does not say in his direct testimony that it
`would have been obvious not to use Hsu going down the Franaszek
`default branch of Figure 4A. If we go back to slide 6 of our presentation,
`patent owner is saying that if you use Hsu in the context of Franaszek,
`you would insert it at block 401 and you would always flow to the right
`of this diagram.
`And we submit that the facts of record as opposed to the legal
`conclusion of what would have been obvious based on those facts shows
`that you absolutely would have very good reason not to use Hsu going
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`Case IPR2017-00176 (Patent 7,161,506 C2)1
`Case IPR2017-00179 (Patent 9,054,728 B2)2
`Case IPR2017-00806 (Patent 7,161,506 C2)1
`Case IPR2017-00808 (Patent 9,054,728 B2)2
`
`down that default branch. And the evidence includes that the number of
`types of data were dramatically increasing in the time period in question.
`There's evidence from Dr. Creusere in paragraphs 131 and 133 of his
`declaration discussing the profusion of new file formats and iterating
`through Hsu's collection of these known data types, these 10, could slow
`the program down. Dr. Creusere explains how pattern matching in the
`context of Unix and the magic file command slowed programs down.
`This is found in 131 of his declaration. It's found in Exhibit 1028,
`page 185, and it's found in Exhibit 1029, page 5 talking about exact
`pattern matching used to identify block types.
`Now, so why wouldn't you use this given these facts of record
`going down the default branch? Well, if you take patent owner at what
`they say, and we don't materially disagree with this, Hsu is entirely
`content-dependent. We don't have to disagree with that point. If, as
`Dr. Zeger says, one of ordinary skill in the art reading Hsu would always
`identify one of those 10 data types regardless of the content of the block,
`then what would happen is you would get the wrong type. You would
`inject inefficiencies and you would basically be tossing aside Franaszek's
`teaching that the default branch should be used when you don't know the
`data type.
`And so if you look at Dr. Zeger's testimony on this particular
`issue -- and I think in the '506 proceeding it's Exhibit 1035. In the '728
`patent IPRs, it's Exhibit 1031. At pages 54 and 55 he talks about how the
`Franaszek system is likely operating based on a file extension that that is
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`Case IPR2017-00176 (Patent 7,161,506 C2)1
`Case IPR2017-00179 (Patent 9,054,728 B2)2
`Case IPR2017-00806 (Patent 7,161,506 C2)1
`Case IPR2017-00808 (Patent 9,054,728 B2)2
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`his reasonable conclusion based on what he understands Franaszek to be
`teaching. He says in this case, you definitely go down the left branch if
`you are looking at Franaszek. Franaszek doesn't know the type, so you
`use the default encoder.
`Now, Dr. Creusere says well, of course, if you did know the
`type, then you could use Hsu as a shortcut. You could short-circuit this
`and get a better identification of the data type when you do know the type
`of the overall file. And Dr. Creusere says that could provide a shortcut.
`That's in paragraph 132 of his declaration. And this could be the most
`efficient and least time-intensive process in the context of using
`Franaszek and Hsu.
`So what does the record evidence show? It shows that
`Franaszek discloses content-dependent and content-independent. That's
`definitely undisputed. It also says Hsu discloses a way of using a
`content-dependent encoder. And what patent owner is saying is that if
`you were to put Hsu into Franaszek, something that we don't think is
`actually a legally appropriate analysis, then when you were to do that,
`you would always guess the data type and you would always proceed
`down the right-hand side of the flowchart here in Franaszek. And we
`submit that that's legally erroneous. That's bodily incorporation, what
`happens when you put one reference into another. And that's what
`Dr. Creusere was testifying about in the context of the deposition
`testimony that they have cited extensively at page 131 of his deposition.
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`Case IPR2017-00176 (Patent 7,161,506 C2)1
`Case IPR2017-00179 (Patent 9,054,728 B2)2
`Case IPR2017-00806 (Patent 7,161,506 C2)1
`Case IPR2017-00808 (Patent 9,054,728 B2)2
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`
`JUDGE MOORE: Counselor, I would like to drill down a little
`bit on this subject. So I would like to take you through your obviousness
`theory a little bit and just make sure I'm understanding it correctly.
`So you concede that Franaszek does not calculate parameters or
`attributes of the type required by claims 1 and 24, correct?
`MR. SOMMER: I don't know that that is something we
`concede because Franaszek does determine a data type of a data block
`when it's available.
`JUDGE MOORE: Right. But that's not a parameter attribute of
`the type required by claims 1 and 24. Isn't that just -- those claims both
`exclude data, analyzing data based solely on a descriptor that's indicative
`of one or more parameters or attributes, and that's the whole basis of you
`looking to Hsu.
`MR. SOMMER: Absolutely. When you get to that point of the
`claim that it's got to exclude solely a descriptor, yes, you are correct,
`Franaszek does not disclose that.
`JUDGE MOORE: And Hsu discloses calculating four different
`parameters or attributes for a given data block; is that correct?
`MR. SOMMER: Yes.
`JUDGE MOORE: Data type and three redundancy matrices,
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`correct?
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`MR. SOMMER: That is correct.
`JUDGE MOORE: So your expert testifies that it would have
`been useful to calculate these four different parameters or attributes
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`Case IPR2017-00176 (Patent 7,161,506 C2)1
`Case IPR2017-00179 (Patent 9,054,728 B2)2
`Case IPR2017-00806 (Patent 7,161,506 C2)1
`Case IPR2017-00808 (Patent 9,054,728 B2)2
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`regardless of whether or not Franaszek's data type information was
`present.
`MR. SOMMER: I don't believe that that is something that our
`expert testified to.
`JUDGE MOORE: Well, perhaps I misstated. He said even if --
`what your expert testified to, I believe, my apologies if I misstated it, is
`that it would be useful to calculate these four parameters or attributes
`even if Franaszek's data type is present.
`MR. SOMMER: That's a consistent or accurate way to
`characterize his direct testimony, yes.
`JUDGE MOORE: And then the argument you are trying to
`make now, which your expert's testimony does not directly support, is
`that a person of ordinary skill in the art would have refrained from
`calculating Hsu's parameters or attributes in circumstances when
`Franaszek's data type is not present, correct?
`MR. SOMMER: That is our position, yes. That's the legal
`conclusion that we are asking the Board to reach.
`JUDGE MOORE: And the evidence and argument you have
`presented, as I understand it, is that it would have been complicated to
`calculate Franaszek's type, data type information because of the profusion
`of file types, correct?
`MR. SOMMER: That's not quite the argument that we are
`presenting. The argument is that if it's not on Hsu's list, even if it were to
`implement the process of Hsu, it would not get the correct data type and
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`Case IPR2017-00176 (Patent 7,161,506 C2)1
`Case IPR2017-00179 (Patent 9,054,728 B2)2
`Case IPR2017-00806 (Patent 7,161,506 C2)1
`Case IPR2017-00808 (Patent 9,054,728 B2)2
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`therefore, these concepts of tailoring your compression type to the data
`type wouldn't be achieved. You are just guessing at that point.
`JUDGE MOORE: You are estimating, right? And an estimate
`is not correct a hundred percent of the time, so I'm not sure it's correct to
`say that you would not get the correct data type. Let's say for a moment
`that I accept your argument as credible that a person of ordinary skill in
`the art would have realized that calculating Hsu's data type is
`complicated and time consuming when you don't have a shortcut in the
`form of Franaszek's data type. So assume that I accept that. What about
`the three redundancy matrices? Why wouldn't you calculate those?
`MR. SOMMER: Well, those don't tell you anything apart from
`data type in the context of Hsu. And you can see that here on our slide 8.
`JUDGE MOORE: Why would you calculate them at all if they
`didn't tell you any additional information that's useful for compression?
`MR. SOMMER: I'm sorry, I guess I don't understand the
`question. I don't think you would calculate them at all if you are not able
`to determine a data type.
`JUDGE MOORE: What is your support for that?
`MR. SOMMER: Well, the way that Hsu operates is it uses this
`table that we have shown here on slide 8. It's table 1 in the Hsu
`reference, Exhibit 1005. In this case, if you don't have the data type, you
`can't index into the table and figure out which compression type to use in
`the first place. I'm sorry. If I misunderstood Your Honor's question, I do
`apologize.
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`Case IPR2017-00176 (Patent 7,161,506 C2)1
`Case IPR2017-00179 (Patent 9,054,728 B2)2
`Case IPR2017-00806 (Patent 7,161,506 C2)1
`Case IPR2017-00808 (Patent 9,054,728 B2)2
`
`
`JUDGE MOORE: No, I think you are getting to the point.
`Please continue. So your theory is that because of the algorithm that Hsu
`uses, that you would not be able to use the redundancy matrices in the
`absence of a calculated data type?
`MR. SOMMER: Right. If you don't have a data type, you can't
`index into this table and select any of the encoding types without that. So
`what Hsu is doing is it calculates these redundancy metrics and selects
`the highest one, I think it says, assuming it's over 2.5. And if it's over
`2.5, then you know you are going to get some degree of valuable data
`compression and we're going to use that. So pick the highest one of these
`redundancy metrics, but in order to select the encoding type, you have to
`know the data type within Hsu. Otherwise, you can't index into the table
`and access the data properly to identify that compression technique.
`JUDGE MOORE: Thank you. I think I understand that better.
`So then I think the whole issue in this case, at least the cases involving
`the '728 patent, the focus is whether or not you have offered adequate
`support for your position that a person of ordinary skill in the art would
`have refrained from calculating Hsu's four parameters or attributes in the
`situation where Franaszek's type information isn't present. I would like
`to take you through the evidence here a little bit and give you a chance to
`express it, because my first reaction is it seems rather odd that you would
`want to calculate type information for a data block in circumstances
`where type information was already present and that you would not want
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`Case IPR2017-00176 (Patent 7,161,506 C2)1
`Case IPR2017-00179 (Patent 9,054,728 B2)2
`Case IPR2017-00806 (Patent 7,161,506 C2)1
`Case IPR2017-00808 (Patent 9,054,728 B2)2
`
`to calculate it in circumstances where it wasn't present. That seems
`backwards.
`JUDGE CHUNG: And to piggy-back on what Judge Moore is
`saying, my concern is, and I'm looking at the 176 IPR, for instance,
`paragraph 65, it seems that Dr. Creusere comes very close to saying why
`you would use it for the if yes branch but not the if no branch, but then
`Dr. Creusere states, Nevertheless, as I discuss below, I do not believe
`such information would be material to my opinions regarding the
`obviousness of the subject matter of the claims I have analyzed.
`So it doesn't seem -- my concern is it doesn't seem like
`Dr. Creusere has really drilled down on this point why you would use it
`for the if yes branch and then all of a sudden you would omit Hsu's
`teaching from the if no branch.
`MR. SOMMER: So if I understood your question, you want to
`understand kind of the lay of the land on the evidence in the record and --
`JUDGE CHUNG: Yes. I was just talking out loud.
`MR. SOMMER: I just want to make sure that I have got the
`questions on the table here to be able to respond fully. So Dr. Creusere
`says in paragraph 65 of the declaration in the '506 proceeding, look, it
`doesn't really matter. There was a fight in a related IPR over the
`teachings of Hsu. And the question there was does this Unix file
`command return data for unknown data types or doesn't it? Does it
`always try to cabin it into one of the 10 things on our list here in slide 8
`or does it return an unknown? And Dr. Creusere said, look, Unix did
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`Case IPR2017-00176 (Patent 7,161,506 C2)1
`Case IPR2017-00179 (Patent 9,054,728 B2)2
`Case IPR2017-00806 (Patent 7,161,506 C2)1
`Case IPR2017-00808 (Patent 9,054,728 B2)2
`
`return unknown data types when it was unable to properly classify things,
`but it doesn't matter to my analysis, as Your Honor pointed out. And the
`reason that he does say that in the '506 proceeding is it simply doesn't
`matter to the claim. The claim is met by performing either one of the
`steps required by the "if" statement or if/if not, right, required by that
`particular claim. And that's under the Board's precedent in Schulhauser.
`JUDGE CHUNG: So let's touch on that for a moment. I will
`note that you made that argument in the 176 case and the consolidated
`and joined case for that. But you did not make it in the 179 case, which
`-- and my guess for that omission is because those claims are directed to
`a system claim. Whereas, in the 176 and all the joined and consolidated
`proceedings with the 176, those recite a method claim.
`Now, pertaining to that Ex Parte Schulhauser issue without
`going too much on a tangent here, was Ex Parte Schulhauser cited in the
`petition?
`MR. SOMMER: I think the record will establish it was not
`cited in the petition.
`JUDGE CHUNG: Okay. And what is the reason for bringing it
`up -- well, why bring it up at the reply if it, I guess -- is it petitioner's
`position that patent owner opened up the door for petitioner to bring up
`that argument at that juncture?
`MR. SOMMER: Absolutely. They said clearly in their patent
`owner response, look, we lose because if you incorporate Hsu into
`Franaszek, which we think is not the right legal analysis, but setting that
`
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`Case IPR2017-00176 (Patent 7,161,506 C2)1
`Case IPR2017-00179 (Patent 9,054,728 B2)2
`Case IPR2017-00806 (Patent 7,161,506 C2)1
`Case IPR2017-00808 (Patent 9,054,728 B2)2
`
`aside, if you incorporate it in, then you are always going to go down
`step 1C of the claim and you are never going to hit, I think in this
`particular -- or it's 104C as opposed to 104F, I think. I'm sorry. You'll
`have to excuse me.
`JUDGE CHUNG: Why shouldn't that be brought up at the
`petition? It seems kind of tenuous to me that patent owner's argument
`would open the door to your argument of citing Ex Parte Schulhauser in
`addition to citing Schulhauser or Cybersettle, Incorporated versus
`National Arbitration Forum, Incorporated, and that's a Federal Circuit
`case that you cited on page 22 of your reply in the 176 IPR. Was that
`Cybersettle versus National Arbitration Forum also cited in the petition
`or is this the first time it's being cited?
`MR. SOMMER: It was cited in response to the patent owner's
`response, Your Honor. They said we lose because if you do insert Hsu
`into Franaszek, you always proceed down the one fork of the decision of
`Franaszek. And as we explained in our reply, look, that's not even the
`right legal analysis. That's not what the obviousness inquiry is designed
`to do. It's not what you are to consider. It's what do the teachings of
`these references as a whole suggest to the person of ordinary skill in the
`art and what ultimately as a legal question would have been obvious to
`that person based on the facts of the record. And if that answers Your
`Honor's question, I would like to get back to Judge Moore's question.
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`Case IPR2017-00176 (Patent 7,161,506 C2)1
`Case IPR2017-00179 (Patent 9,054,728 B2)2
`Case IPR2017-00806 (Patent 7,161,506 C2)1
`Case IPR2017-00808 (Patent 9,054,728 B2)2
`
`
`JUDGE CHUNG: We could touch on that more during your
`rebuttal time. You have 2 minutes and 14 seconds left. You can use that
`remaining time to address Judge Moore's question.
`MR. SOMMER: Thank you very much, Your Honor. So
`Judge Moore, in terms of the evidence of record, this is laid out in our
`reply and in the petition at pages 40 to 41, in the reply, we explain how
`the complete record, developed record shows and establishes the
`inefficiencies of using Hsu in the context of using Hsu to avoid default
`data compression. Franaszek has a system whereby if you know the data
`type and you have these encoders tailored to that data type, you compress
`using those tailored encoders. And if you don't, then you use this default
`set. And the evidence of record including --
`JUDGE MOORE: You test. You run tests and then you try
`and choose a default. You run tests on multiple ones an

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