` UNITED STATES PATENT AND TRADEMARK OFFICE
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`Page 1
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`UNIFIED PATENTS INC., )
`Petitioner, )
`) IPR2018-00044
`)
`vs.
`)
`VILOX TECHNOLOGIES LLC,
`) Patent No.
`Patent Owner.
`______________________________) 7,302,423
`
`PTAB CONFERENCE CALL
`January 9, 2019
`
`REPORTED BY: CARRIE LAMONTAGNE, CSR No. 13393
`JOB NO. 153804
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`PTAB CONFERENCE CALL - 1/9/19
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`January 9, 2019
`3:01 p.m.
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`PTAB conference call, held before
`Administrative Patent Judges Hamann, Medley, and
`Weinschenk, before Carrie LaMontagne, a certified
`shorthand reporter for the State of California.
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`PTAB CONFERENCE CALL - 1/9/19
`A P P E A R A N C E S:
`
` HAYNES BOONE
` Attorneys for Petitioner
`2505 North Plano Road
`Richardson, Texas 75082
` BY: DAVID O'DELL, ESQ.
`
` LAW OFFICE OF JOHN HARROP
` Attorneys for Patent Owner
`440 Belmont Bay Drive
`Woodbridge, Virginia 22320
` BY: JOHN HARROP, ESQ.
`CECIL KEY, ESQ.
`JAY KESAN, ESQ.
`
`Also Appearing Jonathan R.K. Stroud, Esq., Unified
`Patents
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`PTAB CONFERENCE CALL - 1/9/19
`JUDGE HAMANN: Good afternoon. This call
`is for IPR2018-00044. Unified Patents Inc. v. Vilox
`Technologies LLC. I'm Judge Hamann. On line with
`me are Judges Medley and Weinschenk.
` If counsel for Petitioner could please identify
`who is on the line for Petitioner.
`MR. O'DELL: Yes. This is David O'Dell
`for Petitioner.
`JUDGE HAMANN: And if counsel for Patent
`Owner could identify who's on the line for the
`Patent Owner.
`MR. HARROP: Yes, sir. This is
`John Harrop for Patent Owner.
`MR. KEY: And Cecil Key for the Patent
`
`Owner.
`
`JUDGE HAMANN: Good afternoon, gentlemen.
`MR. STROUD: Your honor, Jonathan Stroud
`for Petitioner is on the line as well.
`JUDGE HAMANN: Great.
`MR. HARROP: Your Honor, the call will be
`transcribed.
`JUDGE HAMANN: Thank you. That was my
`question. So there is a court reporter?
`MR. HARROP: Yes, sir.
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`JUDGE HAMANN: Once that transcript is
`available, if we could -- we request that be
`submitted, filed maybe under seal, depending on
`what's said today. I guess that's a bookkeeping
`thing we can put behind us.
` Unless there's no other bookkeeping, we're
`here, my understanding is at the request of Patent
`Owner for this call. So Patent Owner you can begin.
`MR. HARROP: Yes, your Honor. During this
`call Patent Owner will present evidence that we
`believe will justify further discovery as to the
`real parties of interest in this IPR. We're also
`going to discuss how our facts differ from those in
`recent RPI challenges, including Applications in
`Internet Time versus RPX and in the institution
`decision in IPR2018-00883, Unified Patents versus
`Realtime Adaptive Streaming, LLC.
` Specifically, we'll show evidence that at least
`one and possibly more of Unified Patent's members
`were at the time of filing of the petition in this
`case beneficiaries and had a pre-existing
`established relationship with Unified Patents.
`JUDGE HAMANN: Mr. Harrop.
`MR. HARROP: Yes.
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`JUDGE HAMANN: I promised I wouldn't
`interrupt much. I want to help focus, I think, some
`of the inquiries we have, certainly, as you present.
`One of them is -- I want to be real clear exactly
`what Patent Owners are seeking, number one. And
`number two, I believe there was a statement in an
`e-mail along the lines of Patent Owner became aware
`of certain evidence. And really the timing of all
`of that is going to be important too. So we
`definitely want an understanding of when the Patent
`Owner became aware and then, to be frank, of what
`Patent Owner asserts.
` With that sort of as background, please
`continue.
`
`MR. HARROP: Yes, your Honors. We will
`show that at least Salseforce, which is one of
`Unified's patent members which had a pre-existing
`relationship with Unified Patents at the time of
`filing this IPR would benefit from the filing of the
`IPR, and we'll also show that Patent Owner and
`Salseforce were during that same time period engaged
`in extended license negotiations concerning the
`Vilox patent portfolio.
` As we stated during the oral hearing on
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`December 11, Patent Owner became aware of additional
`facts that raised questions about the real parties
`in interest. And we became aware of those facts on
`September 4, 2018. We'll go into some discussion of
`that in a minute.
` Subsequently, and several months into the
`proceedings, Petitioner and Patent Owner agreed to
`voluntary discovery. We also mentioned that during
`the oral hearing. And we got the results of that
`voluntary discovery on December 5, too late to brief
`anything to the panel.
` The discovery request that we received did not
`address fully and fulsomely all of our discovery
`requests and, furthermore, raised additional
`questions that we think merit further discovery. So
`basically we feel that Patent Owner is entitled to
`discovery as to the real parties in interest in this
`case, including Salseforce and any other similarly
`situated members.
` As we stated during oral hearing, we don't
`anticipate this is going to affect the outcome of
`the final decision or the timing of the final
`decision. We believe that all additional discovery
`that we request can be completed and briefed to the
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`panel well in advance of the anticipated decision
`date.
` To explain the timing of some of these events,
`I'd like to bring on our Patent Owner's co-counsel
`Cecil Key who will walk you through the relevant
`events. Cecil, if you would step up, please.
`MR. KEY: Thank you, your Honors. I think
`I'll be brief here. Just to give a little
`background.
` In the fall of 2016 I was engaged by the Patent
`Owner to have a non-litigation -- or outside
`litigation license discussion with Salseforce and we
`began that with some preliminaries in the fall of
`2016. Those discussions became more robust in 2017.
`But in 2017 the sense of what happened was we had
`this pattern of we would have a discussion with
`Salseforce that would be followed by correspondence,
`unsolicited correspondence from a representative
`from Unified Patents, for example.
` We had a call with Salseforce on January 11 or
`so of 2017. Within a couple weeks we had the first
`unsolicited e-mail from someone named Don Moreno of
`Unified Patents. We moved forward. We had a
`meeting with Salseforce in February. That was an
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`exchange of correspondence. Subsequently, in March,
`we had three e-mails from Unified Patents. Then we
`had another in-person meeting with Salseforce in
`June followed by that -- that led to two e-mails
`from another person from Unified Patents in August,
`and then in the very early days of October the IPR
`was filed.
` As to the correspondence from Unified, I think
`largely the feeling was -- maybe it was misdirected.
`It wasn't clear that Vilox actually would fall into
`the category of whatever we understood Unified did,
`but nevertheless -- and I think that position may
`have actually been expressed to Unified very early
`on in the proceedings, saying are you sure you have
`the right guy, essentially. We moved forward with
`the IPR.
` Then in September of 2018, September 4, I
`believe it was, as Mr. Harrop mentioned, we learned
`that Mr. Stroud of Unified had stated that Vilox
`really wasn't the type of company that falls within
`their interest or their purview. And that seemed to
`be a little bit strange and kind of raised the
`question of why we're here. And I think that's what
`triggered the thought that tied everything together,
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`that correspondence and that pattern throughout
`2017; that statement raised the concern that perhaps
`this has not just been a unilateral decision by
`Unified to move forward consistent with whatever
`their regular business model would be and that's
`when the discussions led by Mr. Harrop and Unified
`about the further discovery -- and, of course, at
`that point was right in the shadow of the
`Applications in Time decision from the federal
`circuit.
` So all of that led to the timing is the reason
`that this was not brought before the panel's
`attention before the fall or -- and I think actually
`there was some filings, as I recall, about a
`potential seeking of discovery, but that was pulled
`back because the parties agreed to pursue the
`voluntary discovery route. And the rest of that
`sort of timing is as Mr. Harrop has laid out as to
`when responses were received, et cetera, et cetera.
`JUDGE HAMANN: Mr. Key, forgive me, was
`that September 4th or the 24th?
`MR. KEY: Excuse me. That may be the
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`24th.
`
`JUDGE HAMANN: September 24th is when that
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`occurred?
`
`MR. HARROP: No, it was September 4th.
`This was John Harrop.
`JUDGE HAMANN: Okay. And just to be
`clear, there was an alleged statement by Unified
`Patents, I think you said Mr. Stroud.
` What was the form of that statement? I'm just
`trying to understand that a little bit more.
`MR. KEY: I believe it was a comment made
`to an unrelated third party but one with whom I
`think the Patent Owner has worked before. And I
`don't know what the context was in which they were
`having the discussion, but it was -- the person's
`name I can tell you. His name was
`, and
`I have also done work with Mr.
`. And he
`conveyed to me that they had the conversation where
`Mr. Stroud said if they had known that Vilox was an
`operating company or something to that effect, then
`it would not have brought the IPR.
` I relayed that to Mr. Harrop and there was
`subsequent conversations as well. I believe -- as I
`understand it, I believe that there's not any
`dispute that that statement was actually made.
`JUDGE HAMANN: Okay. Mr. Harrop, anything
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`further as to supporting facts or evidence
`underlying, I guess, the Patent Owner's belief there
`should be additional discovery?
`MR. HARROP: A few other things, your
`Honors. First, on September 6 I called Mr. Stroud
`myself and confirmed the gist of the conversation
`that he had with
` on September 4th. Then
`I had an in-person discussion with a couple other
`attorneys representing petitioner on -- I believe it
`was September 14 or September 15 at a deposition of
`our expert Dr. Chu and mentioned that we would be
`seeking additional discovery because of some issues
`that were raised concerning the possibility that
`Salseforce might be a real party in interest.
` Those two attorneys asked me to table that
`discussion, and then I got into an exchange with
`Mr. O'Dell who's on the call now, who also
`represents Petitioner. And on September 28 I sent
`a -- not very long, about a one-page e-mail to the
`board asking for additional discovery and I laid out
`some of these facts. I believe you do have a copy
`of that e-mail, although it's certainly not of
`record.
` Mr. O'Dell, on that same day, asked me if we
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`could proceed with voluntary discovery, which seemed
`eminently reasonable to me, so I agreed with
`Mr. O'Dell to do that. And then Mr. O'Dell or
`Petitioner wanted to have discovery covered by a
`protective order, which was okay with Patent Owner.
`We went through the process of getting a protective
`order in place, and then I presented our discovery
`request on November 9 and they were answered on
`December 5, as I mentioned before.
` The one thing that I found -- or there were
`several things that I found striking in those
`discovery requests. First, there were seven
`e-mails, the e-mails that Mr. Key alluded to that
`took place between various employees of Unified
`Patents. And Mr. Ambwani -- I may be mispronouncing
`his name, A-D-N-W-A-N-I [sic], something like
`that -- was the chief operating officer, and one of
`the cofounders of Unified Patents was copied on
`every one of those e-mails. Every one of those
`e-mails mentioned Vilox Technologies specifically
`and there were questions in those things about
`seeking a license with Unified.
` We did not respond to any of those e-mails --
`or Mr. Key did not respond to any of these e-mails
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`and that's why -- I think one of the reasons why we
`continued to get those e-mails. Two of the e-mails,
`the ones in August came from a woman named Bante --
`I forget her first name -- who is a vice president
`of operations of Unified Patents.
` So there was fairly consistent communication
`between Unified and Mr. Key and other third
`parties -- Mr. Key was not the only person copied on
`those e-mails -- about Vilox taking the license, and
`an officer of Unified Patents was aware of it. So I
`think it would have been obvious that they should
`have produced those e-mails to us during the
`discovery, but they chose not to do for whatever
`reason. I don't know. But it certainly raises the
`question in my mind, were they trying to hide the
`existence of those e-mails thinking we did not know
`about them or maybe there were other documents that
`they did not produce.
` In any event, the discovery that we received
`from Unified Patents
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` also raises
`additional questions because one of the documents,
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` and that Unified never gets
`involved in any direct negotiations or discussions
`with its members.
` The pattern of e-mails that we saw from
`Unified, the fact that they did not produce those
`e-mails to us when they could have and should have
`and the additional comments in the discovery that
`they did produce makes, I think, a pretty compelling
`case for the fact that Salseforce likely was a real
`party in interest. Salesforce was a member and had
`a relationship with Unified Patents, which is one of
`the prongs of Applications in Internet Time. And
`Salesforce would certainly stand to benefit from an
`IPR filed by Unified Patents in this particular
`case, which is a second prong of Applications in
`Internet Time.
` So I think when you bundle all that together,
`you know, we produced enough evidence to the panel
`that I think it's appropriate that we be given the
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`opportunity to get additional discovery from Unified
`Patents at the direction of the panel because on a
`voluntary basis, Unified did not produce adequate
`discovery. That's our basic request.
` Again, I'll reiterate, we don't expect this to
`have any impact on the final decision, either the
`merits or the timing of that decision. And we will
`cooperate in any way with Petitioner's counsel to
`get that discovery done.
` One of the discovery requests that we
`specifically want is to have the opportunity to do a
`deposition of some officer of Unified Patents to
`talk about exactly what was going on between Unified
`and Cecil Key, why they were communicating with him
`in that whole string of events. And I think I've
`said enough on that.
`JUDGE HAMANN: Let me, Mr. Harrop, just
`clarify two quick things. One, Salesforce has not
`been sued at this point -- it hasn't been sued
`before this patent, correct?
`MR. HARROP: That's correct. We only --
`this goes back a long ways, but Mr. Key had a
`conversation with Salesforce sometime ago -- he can
`relate this to you -- wherein attorneys from
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`Salesforce, in-house attorneys suggested if there
`were ever an issue that came up with licensing a
`patent that they, Salesforce would prefer that the
`outside -- the attorneys for the Patent Owner
`communicate directly with Salesforce's attorneys to
`try to do things on a non-litigation basis.
` That's really why Mr. Key was brought in to
`talk to Salesforce because he had this relationship
`with Salesforce in the past. And that was a path we
`were pursuing. We were trying to get a
`non-litigation license from Salesforce.
`JUDGE HAMANN: Okay. I understand,
`Mr. Harrop. Let me clarify also, too, and I think
`you've clarified, but I want to make it abundantly
`clear. Patent Owner is seeking additional discovery
`supposedly relating to RPIs for future aspects in
`estoppel, and Patent Owner is not in some way
`putting forward that there should be some type of
`bar to the current proceeding; is that correct?
`MR. HARROP: That is correct, your Honor.
`JUDGE HAMANN: Okay. Mr. O'Dell.
`MR. O'DELL: Yes. Thank you, your Honor.
`There's a few things I'd like to emphasize. First
`of all, let's start in a time-wise order. There's
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`communications in the fall of 2016 and through 2017,
`supposedly -- I haven't seen many of these
`communications -- but between Cecil Key, who
`represents Vilox and is on the call today, and
`someone at Unified about licensing. So 2016/2017
`before the IPR was filed.
` Then the other event that Vilox brings to our
`attention is allegedly that on September 4th,
`Mr. Stroud, who's also on this phone call who is a
`representative for unified, said something to a
`person,
`, that we usually don't --
`Unified doesn't file IPRs against companies like
`Vilox or something to that effect.
` Let's look at what's being asked here. For the
`first time of record the Patent Owner is trying to
`bring up the issue of RPI. Potentially, you would
`say that they asked for it in the oral hearing, that
`that was the first time of record but either that
`time or this time right now.
` So we're talking about RPI. Now, discovery
`concluded back on October 22. So under 3742.5(c)3
`it talks about excusing late actions. And we need
`to -- the Patent Owner needs to show good cause
`and/or an interest of justice. So why so late?
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`This case is almost done. We've had the oral
`hearing. We're expecting [indiscernible] in any
`week now.
` Why -- certainly, it's not the 2016 and '17
`e-mails between Unified and Mr. Key because they've
`known about those, obviously, since 2016 or 2017.
`Is it -- what I hear Vilox saying is that this
`September 4, 2018, statement of Mr. Stroud of
`Unified Patents, that -- that the extent of the
`statement is we don't normally file IPRs against
`companies like Vilox, that that has made all this --
`that is the link. That's the good cause that makes
`Vilox think that there's an RPI issue. Lastly,
`Vilox has said they -- their late learning of the
`AIT versus RPX decision which came out in July of
`last year.
` I don't believe any of these are even close to
`showing good cause for a late action to be excused.
`And even if the September 4, 2018, alleged statement
`of Jonathan Stroud is correct, at least that was in
`the middle of discovery and that would have been a
`good time to bring this up, but there was still
`nothing of record about RPI in the middle of
`discovery.
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`PTAB CONFERENCE CALL - 1/9/19
` And lastly, I would like to bring to the
`board's attention to an IPR order. This is for IPR
`number 2018-00139, Paper 17. I'm looking at page 7.
`In this case the Patent Owner brought up the RPI
`during discovery but near the end, near the Patent
`Owner response time frame. And the board in that
`case refused to allow the -- refused to grant a
`motion for discovery relating to RPI saying it was
`not -- it was not timely filed, the request was not
`timely made, and also cited 37 CFR 42.5(c)3, that
`the Patent Owner had not met this ruling of late
`action which can be excused by good cause or an
`interest of justice.
`JUDGE HAMANN: Mr. O'Dell, two questions I
`want to clarify to make sure I understand, I think
`the party's positions.
` Does Petitioner dispute that this September 4th
`statement by Mr. Stroud occurred? I think as you
`characterized -- it's a fine characterization, but
`you said allegedly. So I'm just trying to
`understand whether there's a dispute whether that
`occurred.
`
`MR. STROUD: This is Jonathan Stroud. I
`don't want to be in a position to testify on a call
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`PTAB CONFERENCE CALL - 1/9/19
`with a transcript, obviously. This is uncomfortable
`since this is the first time we're hearing a lot of
`these arguments and a lot of these statements. But
`I have already heard this Patent Owner dispute that
`that conversation happened the way that he's
`indicating that it did.
`
`, Mr.
`, contacted me unapproached.
`He works for a company called IP Val -- or IP
`Valuation that does patent monetization and
`represents nonpracticing entities. He brought up
`Vilox, and he indicated to me that Vilox was not --
`that it was not a nonpracticing entity. That is
`what happened.
`JUDGE HAMANN: Okay.
`MR. STROUD: John -- sorry. Go ahead.
`JUDGE HAMANN: This is Judge Hamann
`speaking. So it's sufficient to say that whether or
`not the statement occurred as characterized by
`Patent Owner is disputed.
` Is that fair?
`MR. STROUD: Yes, that is correct.
`JUDGE HAMANN: Okay. The other question I
`have is relating to when Patent Owner brought this
`up, and I just want to clarify. I think there was
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`PTAB CONFERENCE CALL - 1/9/19
`an -- you know, of record is a phrase, Mr. O'Dell, I
`think that you used a few times.
` There was an e-mail, I believe at one point it
`seems like, seeking potentially the board's help,
`but then the parties came to some arrangement.
`There's a dispute whether that was completed to
`whatever may have been agreed upon, but there was at
`least some indication at some point before the
`hearing or today.
` Is that fair, or how would you characterize
`that e-mail request that I think Patent Owner said
`happened in September? Mr. O'Dell, how would you
`characterize that, if at all, or if I've just got it
`incorrect?
`
`MR. O'DELL: There was, I believe in
`September -- I don't have the date for that, but I
`have November 9 -- there was an e-mail, and then
`November 9 the Patent Owner, John Harrop, sent a
`discovery request to Unified. At the time --
`September, thereabout, the e-mail was sent. We
`talked and we just asked, What do you want? And
`then a month and a half later, John, Mr. Harrop sent
`us a request of what they want. So the request for
`what they -- discovery was received November 9.
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`PTAB CONFERENCE CALL - 1/9/19
`JUDGE HAMANN: Okay. If there's nothing
`further from Petitioner, let's -- before I confer
`with my colleagues, Mr. Harrop, I'll give you a
`chance to reply to that.
`MR. HARROP: Yes, your Honor. With
`respect to the e-mail that we sent -- the Patent
`Owner sent to the board -- what was sent, as I
`recall on September 28, laid out most of these facts
`as we understood them at the time. And on the same
`day Mr. O'Dell got in touch with me and asked if
`Patent Owner would agree to voluntary discovery, as
`I mentioned just a few minutes ago.
` We agreed to that, but the Petitioner wanted a
`protective order in place first. So we waited some
`amount of time which ate into our discovery period,
`in fact, took us right to the end of the discovery,
`before we got to the protective order.
` We didn't feel we should be submitting
`discovery requests until we got the protective order
`in place. Once we got that in place, I think we
`were pretty timely getting the discovery request out
`to the Petitioner. And after that we did get the
`results.
` As far as the conversation with Mr.
`
` and
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`PTAB CONFERENCE CALL - 1/9/19
`Mr. Stroud, of course, this is all hearsay on my
`part. But the relevant argument that we are putting
`forward to the board is that it was Mr. Stroud who
`said had he known that Vilox Technologies was an
`operating company or associated with an operating
`company, he would not have brought the IPR.
` And it's really irrelevant in my mind who
`raised the issue about Vilox Technologies in that it
`actually was and still is, for that matter, an
`operating company. It's got headquarters in
`Louisville, Kentucky, and has been there for about
`12 years or so. So Mr. Stroud's characterization of
`who said what may be accurate, but he left off the
`part where he said we would not have brought that
`conversation, and I think that is what we're talking
`about.
` Now, Mr. O'Dell mentioned Applications in
`Internet Time coming out in July; yes, they did.
`Once we read through the decision on Applications in
`Internet Time, we realized that perhaps the rules on
`RPI would loosen a little bit. But then when we got
`the additional facts in early September, we
`immediately brought that face to face -- I mentioned
`it to Petitioner's attorneys, they stalled for a
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`PTAB CONFERENCE CALL - 1/9/19
`while, rightly or wrongly. I'm not characterizing
`it in any negative way. But I didn't get back with
`Mr. O'Dell until the end of September, and that's
`when we went through this attempt to get the
`discovery.
` The other thing I want to emphasize that
`differs from this IPR that Mr. O'Dell brought up,
`00139. In our case we had an ongoing relationship
`with Salesforce and Petitioner had an ongoing
`relationship with Salesforce and Salesforce would
`benefit from the IPR, clearly. And the voluntary
`discovery clearly failed to produce seven documents
`that we have in our possession. And there's no
`answer for that.
` Mr. O'Dell has not addressed that, nor has
`Mr. Stroud. Why did we not get those documents? I
`think there's a clear difference between our
`situation in IPR 44 and all the other IPRs that
`Unified has been involved with where a real party in
`interest has been brought up. Thank you, your
`Honors.
`
`MR. STROUD: If I may address that just
`shortly because I believe that Mr. O'Dell did.
`JUDGE HAMANN: Very briefly.
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`PTAB CONFERENCE CALL - 1/9/19
`MR. STROUD: Sure. We have not seen those
`communications that he's talking about. But if what
`he's saying today is true -- and this is the first
`time we've heard about it -- what he's talking about
`is communications between Unified and Vilox about
`trying to settle the matter prior to being filed.
`
`
`
`MR. HARROP: Your Honors, this is
`John Harrop again. Our discovery request clearly
`stated that we wanted all communications about Vilox
`and any third party. So for whatever reason Unified
`chose not to produce that. They chose to produce
`something else.
`JUDGE HAMANN: If the parties would please
`hold while we confer.
`(Pause in the proceedings.)
`JUDGE HAMANN: This is Judge Hamann
`speaking again. The panel is going to take the
`Patent Owner's request under advisement. The panel,
`again, requests that a copy of the transcript get
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`PTAB CONFERENCE CALL - 1/9/19
`filed under seal as soon as is reasonable. Thank
`you for everyone's time.
`MR. HARROP: Thank you, your Honors.
`JUDGE HAMANN: The hearing is -- the call
`is adjourned.
`MR. HARROP: Thank you.
`MR. O'DELL: Thank you.
`(Proceedings adjourned at 3:38 p.m.)
`* * * * *
`
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`PTAB CONFERENCE CALL - 1/9/19
`REPORTER'S CERTIFICATE
`
`Page 28
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`I, Carrie LaMontagne, Certified Shorthand
`Reporter within and for the State of California,
`License No. 13393, do hereby certify that the
`proceedings were reported by me on January 9, 2019,
`and was thereafter transcribed with computer-aided
`transcription; that the foregoing is a full,
`complete, and true record of said proceedings.
`I further certify that I am not of counsel
`or attorney for either or any of the parties in the
`foregoing proceedings and caption named or in any
`way interested in the outcome of the cause in said
`caption.
`
`IN WITNESS WHEREOF, I have hereunto set my
`hand and official seal this 11th day of January,
`2019.
`
`____________________________
`CARRIE LAMONTAGNE, CSR
`
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