UNITED STATES PATENT AND TRADEMARK OFFICE
`________________
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`________________
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`WISTRON CORPORATION,
`Petitioner,
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`v.
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`ALACRITECH, INC.,
`Patent Owner
`________________
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`Case IPR2018-00329
`U.S. Patent No. 7,673,072
`________________
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`PATENT OWNER’S PRELIMINARY RESPONSE
`PURSUANT TO 35 U.S.C. § 313 AND 37 C.F.R. § 42.107
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`I.
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`II.
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`U.S. Patent No. 7,673,072
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`TABLE OF CONTENTS
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`Page
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`INTRODUCTION ........................................................................................... 1
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`OVERVIEW OF THE ’072 PATENT ............................................................ 3
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`A.
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`B.
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`The ’072 Patent Specification ............................................................... 3
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`The ’072 Patent Claims ......................................................................... 4
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`III. OVERVIEW OF THE ASSERTED PRIOR ART .......................................... 7
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`A. U.S. Patent No. 5,768,618 to Erickson et al. (“Erickson”) ................... 7
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`B.
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`Andrew S. Tanenbaum, Computer Networks, 3rd ed.
`(1996) (“Tanenbaum”) .......................................................................... 9
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`IV. CLAIM CONSTRUCTION .......................................................................... 10
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`A.
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`B.
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`This Petition Should Be Denied Because Petitioner
`Alleges Certain Claim Terms Are Indefinite ...................................... 10
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`Petitioner’s Proposed Terms for Construction Do Not
`Affect Alacritech’s Non-Obviousness Argument in This
`Preliminary Response .......................................................................... 11
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`V.
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`THE BOARD SHOULD DENY THE PETITION BECAUSE
`IT FAILS TO DISCLOSE ALL REAL PARTIES IN
`INTEREST .................................................................................................... 12
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`A.
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`B.
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`C.
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`D.
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`E.
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`F.
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`Intel Desires Review of the ’072 Patent ............................................. 13
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`Intel Effectively Controls Wistron ...................................................... 15
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`The Relationship Between Intel and Wistron is
`Sufficiently Close ................................................................................ 16
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`Intel And Wistron Have Coordinated Interest And Action
`In Challenging The Patent-In-Suit ...................................................... 18
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`Intel Has Effective Choice as to the Legal Theories and
`Proofs of Wistron ................................................................................ 19
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`Finding That Intel Is A Real Party In Interest Is
`Consistent With Legislative Intent ...................................................... 20
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`VI. THE BOARD SHOULD DECLINE INSTITUTION UNDER
`35 U.S.C. § 325(D) BECAUSE ALL THE PRIOR ART HAS
`ALREADY BEEN CONSIDERED BY THE OFFICE ................................ 21
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`U.S. Patent No. 7,673,072
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`VII. THERE IS NO REASONABLE LIKELIHOOD THAT THE
`PETITIONER WILL PREVAIL UNDER GROUND 1 (THE
`ONLY GROUND) ......................................................................................... 22
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`A.
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`B.
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`C.
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`There Is No Motivation to Combine Erickson and
`Tanenbaum .......................................................................................... 23
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`Tanenbaum Fails to Disclose and Teaches Away [1.4]
`[9.4] or [15.4] “Dividing, by the Interface Device, the
`Data into Segments” ............................................................................ 24
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`Erickson Fails to Disclose [1.4] [9.4] or [15.4] “dividing,
`by the interface device, the data into segments” ................................. 26
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`1.
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`2.
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`Erickson does not disclose any interface device
`that is capable of dividing the data into segments .................... 26
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`Petitioner’s reliance on its expert’s hindsight
`modifications of Erickson is baseless ....................................... 27
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`VIII. ALACRITECH RESERVES ITS RIGHTS UNDER THE
`PENDING OIL STATES CASE AT THE UNITED STATES
`SUPREME COURT ...................................................................................... 31
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`IX. CONCLUSION ............................................................................................. 31
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`TABLE OF AUTHORITIES
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`Page
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`Cases
`ActiveVideo Networks, Inc. v. Verizon Commc’ns, Inc.,
`694 F.3d 1312 (Fed. Cir. 2012) ................................................................ 30
`Alacritech, Inc. v. CenturyLink, Inc.,
`2:16-cv-00693-JRG-RSP (E.D. Tex.) ................................................... 1, 12
`Alacritech, Inc. v. Dell Inc.,
`2:16-cv-00695-RWS-RSP (E.D. Tex.) ................................................. 1, 12
`Alacritech, Inc. v. Wistron Corp.,
`2:16-cv-00692-JRG-RSP (E.D. Tex.) ................................................... 1, 12
`ams AG v. 511 Innovations, Inc.,
`Case IPR2016-01788 (PTAB Mar. 15, 2017) .......................................... 11
`Benson & Ford, Inc. v. Wanda Petroleum Co.,
` 833 F.2d 1172 (5th Cir. 1987) ................................................................. 16
`Fidelity Nat’l Info. Servs., Inc. v. DataTreasury Corp.,
`IPR2014-00489 ......................................................................................... 28
`Oil States Energy Servs. LLC v. Greene’s Energy Group, LLC,
`Case No. 16-712, certiorari granted (U.S. Jun. 12, 2017) ....................... 31
`In re Steele,
`305 F.2d 859 (CCPA 1962) ...................................................................... 11
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`Statutory Authorities
`35 U.S.C. § 103(a) .......................................................................................... 1
`35 U.S.C. § 312(a)(2) ................................................................................ 2, 12
`35 U.S.C. § 313 ............................................................................................... 1
`35 U.S.C. § 314 ............................................................................................... 3
`35 U.S.C. § 314(a) .......................................................................................... 7
`35 U.S.C. § 315 ............................................................................................. 14
`35 U.S.C. § 315(b) ........................................................................................ 14
`35 U.S.C. § 325(d) ........................................................................................ 22
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`Rules and Regulations
`37 C.F.R. § 41.65(a) ...................................................................................... 30
`37 C.F.R. § 42.6(a)(3) ................................................................................... 28
`37 C.F.R. § 42.8(b)(1) ............................................................................... 2, 12
`37 CFR § 42.22(a)(2) .................................................................................... 28
`37 C.F.R. § 42.106(b) .................................................................................... 12
`37 C.F.R. § 42.107(a) ...................................................................................... 1
`37 C.F.R. § 42.108 .......................................................................................... 3
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`Office Patent Trial Practice Guide, 77 Fed. Reg. 48756, 48759-60
`(Aug. 14, 2012) .................................................................................. passim
`H.R. Rept. No 112-98 (2011) (Judiciary Committee Report on H.R. 1249,
`June 1, 2011) ............................................................................................. 20
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`Legislative Materials
`157 Cong. Rec. S1034, S1041 (Mar. 1, 2011) .............................................. 20
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`PATENT OWNER’S LIST OF EXHIBITS
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`Exhibit #
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`Description
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`Ex. 2001
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`Declaration of Paul Prucnal
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`Ex. 2002
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`Intel’s Motion to Intervene in Alacritech v. Wistron
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`Ex. 2003
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`Not used
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`Ex. 2004
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`Ex. 2005
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`Excerpts of Webster’s New World Dictionary of
`Computer Terms, Sixth Edition, 1997.
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`Excerpts of Wistron Response to Second Set of Common
`Interrogatories
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`Ex. 2006
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`Not used
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`Ex. 2007
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`Not used
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`Ex. 2008
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`Excerpts of Declaration of Mr. Mark R. Lanning
`Regarding Claim Construction
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`Ex. 2009
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`Not used
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`Ex. 2010
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`Curriculum Vitae of Paul Prucnal
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`Case No. IPR2018-00329
`U.S. Patent No. 7,673,072
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`I.
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`INTRODUCTION
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`Pursuant to 35 U.S.C. § 313 and 37 C.F.R. § 42.107(a), Patent Owner
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`Alacritech Inc. (“Alacritech”) submits this Preliminary Response to the Petition for
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`Inter Partes Review (“the Petition”) filed in this matter.1 Petitioner Wistron
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`Corporation (“Wistron”) seeks Inter Partes Review (“IPR”) of claims 1-21 of U.S.
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`Patent No. 7,673,072 (“the ’072 patent”), as allegedly being unpatentable under 35
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`U.S.C. § 103(a). The ’072 patent is assigned to Alacritech and is the subject of co-
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`pending litigation, Alacritech, Inc. v. CenturyLink, Inc., 2:16-cv-00693-JRG-RSP
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`(E.D. Tex.); Alacritech, Inc. v. Wistron Corp., 2:16-cv-00692-JRG-RSP (E.D.
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`Tex.); and Alacritech, Inc. v. Dell Inc., 2:16-cv-00695-RWS-RSP (E.D. Tex.),
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`which were all consolidated for pre-trial purposes (“the Litigation”).
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`The ’072 Patent discloses a system with “a specialized microprocessor
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`designed for processing network communications, avoiding the delays and pitfalls
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`of conventional software layer processing, such as repeated copying and interrupts
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`to the CPU,” and “freeing the host CPU from most protocol processing and
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`allowing improvements in other task.” Ex. 1001 at 5:44-47, 7:47-49. The ’072
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`patent’s claims focus on the transmission side of the protocol processing. The host
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`1 This submission is timely as it is being filed within three months following the
`mailing date of the Notice of Filing Date Accorded to Petition. The three-month
`date following the September 28, 2017 mailing date is Wednesday, March 28,
`2018. (Paper No. 9).
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`1
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`gives raw data to the INIC which it must carve into segments, add headers to the
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`data, perform checksums on the segment, and then send it out. As explained in
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`more detail below, by relieving the host CPU of frequent and debilitating
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`interrupts, the claimed invention provides enhanced network and system
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`performance, faster data throughput, increased system stability, and an overall
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`better user experience.
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`In its Petition, Wistron asserts that the ’072 patent is invalid on the ground
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`that claims 1-21 of the ’072 patent are obvious over U.S. Patent No. 5,768,618 to
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`Erickson (“Erickson”) (Ex. 1005) and Computer Networks, A. Tanenbaum, 3rd ed.
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`(1996) (“Tanenbaum”) (Ex. 1006), two references that were already considered by
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`the Office during the prosecution of the ’072 patent. The Board should not second
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`guess the opinion of the original examiner and exercise its discretion not to
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`institute this Petition on this basis alone. As set forth below, Petitioner has not
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`established that any references disclose “dividing, by the interface device, the data
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`into segments” as recited in the challenged independent claims of the ’072 patent.
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`The Board should deny institution of the Petition also because Petitioner has
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`failed to identify all real parties in interest as required by 35 U.S.C. § 312(a)(2) and
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`37 CFR § 42.8(b)(1). At the very least, the Board should allow Alacritech to seek
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`early discovery on this issue. Further, the Petitioner asserts that the challenged
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`claims (claims 1-21) are indefinite in scope. Without ascertaining proper claim
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`scope, the Board cannot conduct a necessary factual inquiry for determining
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`obviousness.
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`For at least these reasons, the Board should not institute this IPR. See 35
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`U.S.C. § 314; 37 C.F.R. § 42.108.
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`II. OVERVIEW OF THE ’072 PATENT
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`A. The ’072 Patent Specification
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`The ’072 Patent discloses a system with “a specialized microprocessor
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`designed for processing network communications, avoiding the delays and pitfalls
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`of conventional software layer processing, such as repeated copying and interrupts
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`to the CPU,” and “freeing the host CPU from most protocol processing and
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`allowing improvements in other task.” Ex. 1001 at 5:44-47, 7:47-49.
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`The ’072 patent’s claims focus on the transmission side of the protocol
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`processing. See id. at 97:30-31 (“to form transmit packets”). Fig. 24 of the ’072
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`patent depicts a receiving embodiment with a specialized Intelligent Network
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`Interface Card (INIC) providing a fast path for protocol processing. Id. at Fig. 24.
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`“The transmit case works in much the same fashion . . . In fast-path mode,
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`the host gives raw data to the INIC which it must carve into MSS sized segments,
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`add headers to the data, perform checksums on the segment, and then send it out on
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`the drive.” Id. at 38:55-61 (emphasis added).
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`This “carving” process conducted by the INIC is reflected in Claim 1 as well
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`as all other independent claims, where it recites “dividing, by the interface device,
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`the data into segments.” Id. at 97:26. (emphasis added). As analyzed below, this
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`“dividing” step conducted by “the interface device” is not disclosed by either of the
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`cited references or their combination.
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`B.
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`The ’072 Patent Claims
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`The ’072 Patent includes 21 claims. All 21 claims are challenged in the
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`Petition. Claims 1, 9, and 15 are the independent claims and each recites
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`“dividing, by the interface device, the data into segments.” Claims 2-8, 10-14, and
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`16-21 depend on the independent claims. Independent claims 1, 9, and 15 are
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`reproduced below:
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`Claim 1. A method comprising:
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`establishing, at a host computer, a transport layer connection,
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`including creating a context
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`that
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`includes protocol header
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`information for the connection;
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`transferring the protocol header information to an interface device;
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`transferring data from the network host to the interface device, after
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`transferring the protocol header information to the interface device;
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`dividing, by the interface device, the data into segments;
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`creating headers for the segments, by the interface device, from a
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`template header containing the protocol header information; and
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`prepending the headers to the segments to form transmit packets.
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`Claim 9. A method comprising:
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`creating, at a computer, a context including protocol information and
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`status information for a network connection, the protocol information
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`providing a template header for the network connection;
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`transferring the protocol information and status information to an
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`interface device;
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`transferring data from the computer to the interface device, after
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`transferring the protocol information and status information to the
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`interface device;
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`dividing, by the interface device, the data into segments;
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`creating headers for the segments, by the interface device, from the
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`template header;
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`prepending the headers to the segments to form packets; and
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`transmitting the packets on a network.
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`Claim 15. A method comprising:
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`establishing, at a computer, a Transmission Control Protocol (TCP)
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`connection corresponding
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`to a context
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`that
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`includes status
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`information and Internet Protocol (IP) addresses and TCP ports for
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`the connection;
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`transferring the context to an interface device;
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`transferring data from the network host to the interface device;
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`dividing, by the interface device, the data into segments;
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`creating headers for the segments, by the interface device, from a
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`template header that includes the IP addresses and TCP ports; and
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`prepending the headers to the segments to form transmit packets.
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`Since the cited references, alone or in combination with each other, fail to
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`disclose the element “dividing, by the interface device, the data into segments,”
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`which is present in all the independent claims, this Petition should not be instituted
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`pursuant to 35 U.S.C. § 314(a).
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`III. OVERVIEW OF THE ASSERTED PRIOR ART
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`A. U.S. Patent No. 5,768,618 to Erickson et al. (“Erickson”)
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`Erickson appears on the face of the ’072 patent under “References Cited”
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`and was initialed by the Examiner in an Information Disclosure Statement (IDS)
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`dated October 26, 2009. Ex. 1002.303; see also Ex. 1001.002. Erickson was
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`therefore already considered by the Examiner during the prosecution of the ’072
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`patent, which was found to be allowable over Erickson
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`Erickson “provides a capability for multiple user processes in a single
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`computing node to simultaneously share direct access to an I/O device without the
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`intervention of the operating system for each data transfer as it occurs.” Ex. 1005,
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`2:54-56. Such intervention is caused because “[p]rogramming an input/output
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`(I/O) device typically involves a user software process making a call to the
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`operating system, [which] involves a context switch that swaps information in
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`system registers and memory in order to process incoming data.” Id., 2:43-47.
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`Instead of adding another specialized microprocessor, Erickson solves this
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`problem by “mapping a small portion of the memory of the I/O device directly into
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`the virtual address space of the user process.” Id., 2:63-66. This solution is further
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`described in Erickson Fig. 2 shown below.
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`Erickson “maps a portion of memory 206, physically located on the I/O
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`device adapter into a device driver’s address space 208. [Erickson] also maps sub-
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`portions. e.g., pages, 210, 212. of the I/O device adapter’s memory 206 into the
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`address spaces for one or more user processes 202, 204, thereby allowing the user
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`processes 202, 204 to directly program the I/O device adapter without the overhead
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`of the operating system, including context switches.” Id., 3:48-56. In other words,
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`the user process is able to access the I/O physical memory just as it would access
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`the system working memory, without needing to interrupt the operating system.
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`The I/O device driver running in the operating system kernel can also use the same
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`I/O physical memory as its RAM space. Since both the operating system kernel
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`and the user process have direct access to the I/O physical memory through the
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`virtual memory, the I/O process will eliminate calls to the operating system and the
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`associated context switches on a per I/O basis, and will also reduce the number of
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`intermediate memory-to-memory copies generated when routing I/O data. See Ex.
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`1005 at 3:4-5 and 8-9.
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`However, the Erickson solution is about a design of memory system,
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`especially how to share physical memory on an I/O device among the user
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`processes and the operating system through virtual memory. It does not disclose
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`any interface device that is capable of dividing the data into segments.
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`B. Andrew S. Tanenbaum, Computer Networks, 3rd ed. (1996)
`(“Tanenbaum”)
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`Tanenbaum also appears on the face of the ’072 patent under “References
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`Cited” and was initialed by the Examiner in an Information Disclosure Statement
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`(IDS) dated October 26, 2009. Ex. 1002.312; see also Ex. 1001.004. It is a
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`textbook with more than 800 pages. Petitioner cited only a few pages in its
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`Petition, where Tanenbaum mentions a “fast path” processing for TCP. Ex. 1006
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`at 584. This fast path processing is introduced to improve the network
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`performance. Id. at 583. However, this proposal is fundamentally different from
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`the ’072 patent in that it is a software proposal, without altering the location where
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`any of the processing occurs (e.g., on the host or on the interface device) and
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`particularly without disclosing an interface device capable of dividing the data into
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`segments.
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`Tanenbaum emphasizes the role played by software in improving network
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`performance. “The software and operating system are often more important than
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`the routers and interface boards.” Ex. 1006 at 579. In the section cited by the
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`Petitioner, the author states that “[t]he moral of the story above is that the main
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`obstacle to fast networking is protocol software. In this section we will look at
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`some ways to speed up this software.” Ex. 1006 at 583 (emphasis added). The
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`Fast path processing disclosed by Tanenbaum is one way of designing the
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`software; it does not introduce any interface device that divides the data into
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`segments.
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`IV. CLAIM CONSTRUCTION
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`A. This Petition Should Be Denied Because Petitioner Alleges
`Certain Claim Terms Are Indefinite
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`Petitioner expressly contends that the limitations “context” appearing in all
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`independent claims and “status information” in independent claims 9 and 15 must
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`be construed for this Petition and are indefinite. See Petition at 25-26 (“Petitioner
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`respectfully submits that the following terms shall be construed for this IPR . . .
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`Petitioner contends that ‘context’ is indefinite as used in the 072 Patent claims . . .
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`Petitioner has taken the position that ‘status information’ as used in the 072 Patent
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`is indefinite.”). This contention, without more, should end the Board’s inquiry into
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`all independent claims and their dependent claims.
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`“If [the Board’s] unpatentability analysis requires ‘considerable speculation
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`as to the meaning and assumptions as to the scope’s of the claims, the differences
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`between the claimed invention and the prior art cannot be ascertained.” ams AG v.
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`511 Innovations, Inc., Case IPR2016-01788, Paper No. 15 at 6 (PTAB Mar. 15,
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`2017) (quoting In re Steele, 305 F.2d 859, 862 (CCPA 1962)). “In other words,
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`without ascertaining proper claim scope,” the Board “cannot conduct a necessary
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`factual inquiry for determining obviousness—ascertaining differences between the
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`claimed subject matter and the prior art.” Id. (quotation marks and citations
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`omitted). Where, as here, a Petitioner’s own submission asserts that challenged
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`claims (claims 1-21) are indefinite in scope, the Board cannot institute an
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`obviousness trial against those claims. See id. at 11-12 (denying institution on all
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`claims based on indefiniteness in independent claim). The Board should therefore
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`deny institution of this Petition as to claims 1-21 on this basis alone.
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`B.
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`Petitioner’s Proposed Terms for Construction Do Not Affect
`Alacritech’s Non-Obviousness Argument in This Preliminary
`Response
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`The two terms proposed by Petitioner for construction, “context for
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`communication” and “prepend,” do not otherwise affect Alacritech’s non-
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`obviousness argument in this preliminary response. Therefore, it is unnecessary
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`for Alacritech to address them for purpose of this preliminary response.
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`V. THE BOARD SHOULD DENY THE PETITION BECAUSE IT FAILS
`TO DISCLOSE ALL REAL PARTIES IN INTEREST
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`A requirement of a petition includes identifying “all real parties in interest.”
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`35 U.S.C. § 312(a)(2).2 The Board should deny institution of this IPR because the
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`Petition fails to identify all real parties in interest as required by 35 U.S.C. §
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`312(a)(2) and 37 CFR § 42.8(b)(1).
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`The Petition identifies only three real parties-in-interest: Wistron, SMS
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`InfoComm Corporation, and Wiwynn Corporation.3 In doing so, the Petition at
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`least fails to identify Intel Corporation (“Intel”), an intervenor in Alacritech’s
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`2 See also IPR2014-00689, Paper No. 22 (Aug. 12, 2014) (holding that failing to
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`list a real party in interest can result in the petition to be considered “an incomplete
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`petition” under Rule 42.106(b), not entitled to receive a filing date).
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`3 See Petition at 2 (“Petitioner—and co-defendants in the below mentioned district
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`court litigation, SMS InfoComm Corporation and Wiwynn Corporation—are the
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`real-parties-in-interest with regard to this Petition. No other parties exercised or
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`could have exercised control over this Petition; no other parties funded or directed
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`this Petition. ”).
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`patent infringement lawsuit over the ’072 Patent.4 Intel is Wistron’s supplier and
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`indemnitor. Intel and Wistron have closely intertwined financial interests and
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`business relationships; express indemnification obligation; shared experts; and
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`common litigation strategy with respect to their defense against Alacritech’s ’072
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`Patent. Moreover, the fact that Wistron and Intel filed almost verbatim petitions
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`(compare IPR2017-01406 with IPR2018-00329) is strong evidence that the two
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`were in privy and cooperating in the drafting of each other’s petitions yet neither
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`party names the other as a real party interest. These and related facts, further
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`discussed below, plainly indicate that under the totality of the circumstances, Intel
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`is in privy with Wistron, and is an unnamed real party-in-interest to this Petition.
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`Office Patent Trial Practice Guide, 77 Fed. Reg. 48756, 48759-60 (Aug. 14, 2012).
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`A.
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`Intel Desires Review of the ’072 Patent
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`A “real party in interest” is “the party that desires review of the patent.” See
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`Office Patent Trial Practice Guide, 77 Fed. Reg. at 48759; see also IPR2014-
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`
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`4 The co-pending district court cases, Alacritech v. CenturyLink, Alacritech v.
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`Wistron, and Alacritech v. Dell, were filed on June 30, 2106, and consolidated for
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`pre-trial purposes. In March 2017, Intel filed a motion to intervene in the district
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`court case because Wistron’s accused products used components supplied by Intel.
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`Ex. 2002 at 1.
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`00488, Paper No. 52 at 9-10 (March 16, 2015). Here, Intel has an interest in the
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`claims of the patents being determined to be unpatentable, which would allow it to
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`avoid liability in the district court case. This was explicitly admitted in Intel’s
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`Motion to Intervene:
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`Intel has a direct financial stake in the suit due to its partial
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`indemnification of Wistron. . . . If Wistron were found to directly
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`infringe in this case based on its use of Intel’s products, there is a
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`clear interrelation with Alacritech’s case against Intel for direct and
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`indirect infringement by those same Intel products used by Wistron.
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`Further, Intel may be liable to Wistron for indemnity. . . . A
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`manufacturer has a strong interest in being heard in a patent
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`infringement action where the accused products incorporate its
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`components. . . . An adverse ruling could also substantially damage
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`Intel’s reputation, its relationships with its other customers, and its
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`future customer base. . . . A manufacturer such as Intel has a greater
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`interest than its customers in defending allegations of patent
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`infringement focused on its products. . . . Moreover, Intel has a
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`compelling interest in seeing the case through judgment and fully
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`addressing the merits of Alacritech’s claims against Intel’s products.
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`Because the cost of patent litigation is high and often forces parties
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`into settlement before the merits are fully addressed, a customer may
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`not have as great an interest as a manufacturer, such as Intel, in
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`fully litigating the case to obtain findings of non-infringement.
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`Ex. 2002 at 9-11. Intel’s strong interests in the district court litigation shows
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`that it is the real-party-in-interest that desires review of the patent-in-suit.
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`B.
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`Intel Effectively Controls Wistron
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`“There are multiple factors relevant to the question of whether a non-party
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`may be recognized as a ‘real party in interest’ or ‘privy.’ A common consideration
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`is whether the non-party exercised or could have exercised control over a party’s
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`participation in a proceeding.” Office Patent Trial Practice Guide, 77 Fed. Reg. at
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`48759-60. “Absolute control, however, is not necessary. Instead, a nonparty will
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`be found to have control if it ‘has the actual measure of control or opportunity to
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`control that might reasonably be expected between two formal coparties.’
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`Moreover, actual control is not required; the opportunity to exert the appropriate
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`level of control is sufficient.” IPR2014-01380, Paper No. 34 at 8 (April 5, 2015)
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`(internal citations omitted).
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`In IPR2014-01380, the Board found the petitioner General Electric
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`Company (“GE”) failed to disclose a real party interest, Oklahoma Gas & Electric
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`Company (“OG&E”), whom the petitioner had control over in a district court case.
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`Id. The petitioner GE’s control over the district court defendant was based on their
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`agreement stating that “Petitioner would ‘provide a full and unqualified defense to
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`OG&E.’” Id. Intel has a similar agreement with Wistron. In Intel’s Motion to
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`Intervene, it stated that it “ha[d] agreed to defend and partially indemnify Wistron
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`for Alacritech’s allegations based on Intel products incorporated into the accused
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`Wistron products.” Ex. 2002 at 2 (emphasis added). Just as GE did in IPR2014-
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`01380, Intel failed to disclose a party in the district court case it agreed to actively
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`defend.
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`C. The Relationship Between Intel and Wistron is Sufficiently Close
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`“Privity is essentially a shorthand statement that collateral estoppel is to be
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`applied in a given case. . . . The concept refers to a relationship between the party
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`to be estopped and the unsuccessful party in the prior litigation which is
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`sufficiently close so as to justify application of the doctrine of collateral estoppel.”
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`Office Patent Trial Practice Guide, 77 Fed. Reg. at 48759.
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`Intel is Wistron’s supplier with regard to Wistron’s accused products. See
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`Ex. 2002 at 4 (“Alacritech accuses Wistron of infringing its seven asserted patents
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`based in part on Wistron’s use of Intel’s 82547L Ethernet controller, Intel’s I210-
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`AT Ethernet controller, and Intel’s X550-AT2 Ethernet controller.”).
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`Intel admitted that it would have to work closely with Wistron in this
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`litigation. “Intel is in a better position to defend against infringement allegations
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`focused on Intel products because it has the relevant knowledge and expertise
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`regarding its own technology. While Wistron incorporates Intel’s highly complex
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`networking technology components into its own products, it does not design or
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`manufacture those components. Many of Alacritech’s allegations are directed to
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`features conceived, designed and implemented by Intel on the chips Wistron uses
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`in its products. As such, Intel is in a better position to assert all applicable defenses
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`relevant to its technology.” Ex. 2002 at 11.
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`Intel also admitted that it has a close relationship to Wistron financially in
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`the district court case. “Intel has agreed to defend and partially indemnify Wistron
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`for Alacritech’s allegations based on Intel products incorporated into the accused
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`Wistron products. For this reason as well, Intel has a substantial, direct financial
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`interest in the outcome of the Wistron case.” Ex. 2002 at 2. Indemnification is a
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`factor favoring finding of privity. See IPR2014-01380, Paper No. 34 at 7-8
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`(“indemnitors . . . assume control of litigation against the parties they indemnify.”);
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`see also Benson & Ford, Inc. v. Wanda Petroleum Co., 833 F.2d 1172, 1174 (5th
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`Cir. 1987).
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`In addition, Intel chose not only to passively reimburse Wistron, but also
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`play an active role to assist, protect, and defend Wistron. See Ex. 2002 at 2 (“Intel
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`has agreed to defend and partially indemnify Wistro