`
`UNITED STATES PATENT AND TRADEMARK OFFICE
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`__________________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`___________________
`
`SIRIUS XM RADIO INC.,
`Petitioner,
`
`v.
`
`FRAUNHOFER-GESELLSCHAFT ZUR FÖRDERUNG DER
`ANGEWANDTEN FORSCHUNG E.V.,
`Patent Owner.
`____________________
`
`Case IPR2018-00681
`Patent No. 7,061,997
`
`__________________________________________________________
`
`PETITIONER’S REPLY TO PATENT OWNER’S
`PRELIMINARY RESPONSE
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`
`
`
`
`
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`TABLE OF CONTENTS
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`IPR2018-00681
`U.S. Patent No. 7,061,997
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`Page
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`Sirius XM Properly Identified The RPIs ......................................................... 1
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`Patent Owner’s Erroneous Claim Construction .............................................. 4
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`I.
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`II.
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`
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`i
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`IPR2018-00681
`U.S. Patent No. 7,061,997
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`TABLE OF AUTHORITIES
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` Page(s)
`
`Federal Cases
`Am. Med. Sys., Inc. v. Biolitec, Inc.,
`618 F.3d 1354 (Fed. Cir. 2010) ........................................................................... 5
`
`Arthrex, Inc. v. Parcus Med., LLC,
`2014 WL 3747610 (M.D. Fl. 2014) ...................................................................... 5
`
`Atlanta Gas Light Co. v. Bennett Regulator Guards, Inc.
`IPR2013-00453, Paper 88 (PTAB Jan. 6, 2015) ................................................. 3
`
`Daifuku Co., Ltd. et al. v. Murata Machinery, Ltd.,
`IPR2015-01538, Paper 11 (PTAB Jan. 19, 2016) ........................................ 1, 2, 3
`
`Galderma S.A, et al. v. Allergan Industrie, SAS, et al.,
`IPR2014-01422, Paper 14 (PTAB Mar. 5, 2015) ................................................. 1
`
`Lumentum Holdings, Inc. et al. v. Capella Photonics, Inc.,
`IPR2015-00739, Paper 38 (PTAB Mar. 4, 2016) ................................................. 3
`
`Proppant Express Investments, LLC et al. v. Oren Techs., LLC,
`IPR2017-02103, Paper 8 (PTAB Jan. 10, 2018) .............................................. 3, 4
`
`RPX Corp. & Vimeo, Inc., v. Link Engine Techs. LLC,
`IPR2017-00886, Paper 11 (PTAB Aug. 18, 2017) ............................................... 4
`
`Rubicon Comms., LP, v. Lego A/S,
`IPR2016-01187, Paper 40 (PTAB Dec. 16, 2016) ............................................... 4
`
`Zoll Lifecor Corp. v. Philips Electronics North America Corp. et al.,
`IPR2013-00609, Paper 15 (PTAB Mar. 20, 2014) ........................................... 2, 3
`
`
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`- ii -
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`
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`IPR2018-00681
`U.S. Patent No. 7,061,997
`
`EXHIBIT NO.
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`EXHIBIT LIST
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`DESCRIPTION
`
`Exhibit 1024 Declaration of Patrick L. Donnelly
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`- iii -
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`IPR2018-00681
`U.S. Patent No. 7,061,997
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`I.
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`SIRIUS XM PROPERLY IDENTIFIED THE RPIS
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`Sirius XM Radio Inc. (“Radio”) named all real parties in interest (“RPIs”) in
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`its Petition and Patent Owner’s (“PO”) contrary arguments (Paper 8 (“Resp.”) at 4-
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`5, 18-20) should be rejected. As explained in the accompanying declaration, Sirius
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`XM Holdings Inc. (“Holdings”) and Liberty Media Corp. (“Liberty”) are not RPIs
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`because they (1) do not direct or control business activities and operations of
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`Radio; and (2) have not directed, controlled, funded (e.g., PTO or legal fees) or
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`otherwise been involved in these proceedings. Ex. 1024, ¶¶ 3-15. Holdings is a
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`non-operational holding company and owns all the issued and outstanding capital
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`stock of Radio, while Liberty’s connection is even more attenuated as it merely
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`owns 70% of the outstanding common stock of Holdings. Id., ¶¶ 3-4, 7-9.
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`These facts align squarely with Daifuku Co., Ltd., et al. v. Murata
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`Machinery, Ltd., IPR2015-01538, in which “a ‘holding company that merely holds
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`ownership of its subsidiaries and conducts no independent operations’” was found
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`not to be an RPI. Daifuku, Paper 11 at 8–9 (“The exercise or availability of
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`general ‘control’ that stock ownership vests in stockholders…will not make one
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`company a real party in interest of the other.”). Like in Daifuku, PO’s evidence
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`here, at best, only “establishes a [stock ownership] relationship between parties and
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`does not establish a relationship between Holdings and this proceeding.” Id. at 11.
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`PO’s reliance on Galderma S.A. v. Allergan Industrie, SAS, IPR2014-01422,
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`- 1 -
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`IPR2018-00681
`U.S. Patent No. 7,061,997
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`suggesting that an RPI is one that “has the power to ‘call the shots’” (Resp. at 14)
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`is misleading as the Board in Daifuku explained that this is not the “complete legal
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`principle.” Daifuku at 11. Rather, the “evidence as a whole must establish that the
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`nonparty possessed effective control over a party’s conduct…as measured from a
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`practical, as opposed to a purely theoretical, standpoint.” Id. Examples of such
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`practical control include “where a liability insurer assumes the insured’s defense;
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`where an indemnitor participates in defending an action brought against the
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`indemnitee; and where the owner of a close corporation assumes control of
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`litigation brought against the firm.” Id. Here, neither Holdings nor Liberty has
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`any such “practical control” of Radio because neither controls Radio’s business
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`activities nor has had any involvement in these proceedings. Ex. 1024, ¶¶ 3-15.
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`Instead, PO’s arguments focus on theoretical control based on the entities
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`having common addresses and overlapping officers disconnected from these
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`proceedings. Resp. at 6-14. Such arguments fail as the Board and Supreme Court
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`precedent confirm. Daifuku at 10–11 (“[E]vidence of a common address and
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`telephone number, substantial overlap of officers, and the other evidence on which
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`PO relies, establishes a relationship between parties; it does not establish a
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`relationship between Daifuku Holdings and this proceeding.”).
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`PO’s reliance on Zoll Lifecor Corp. v. Philips Electronics North America
`
`Corp., IPR2013-00609, is similarly misplaced because, unlike there, Holdings and
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`- 2 -
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`IPR2018-00681
`U.S. Patent No. 7,061,997
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`Liberty are not accused of infringing the challenged patent and there is no evidence
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`that “the non-party possesse[s] effective control from a practical standpoint.” Zoll,
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`Paper 15 at 10; see also Ex. 1024, ¶¶ 10-15. Indeed, this is not a situation where a
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`non-party is litigating through a proxy. Daifuku at 7 (RPI “requirement exists to
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`ensure that a non-party is not ‘litigating through a proxy’”). There is also no
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`evidence of blurring the lines between Radio and Holdings or Liberty of the type
`
`found in Atlanta Gas Light There, the petitioner’s officer and its parent conducted
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`negotiations with the patent owner in the related litigation, represented himself as
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`an officer of the parent, and the parent may have paid the IPR filing and attorney
`
`fees. Atlanta Gas Light, IPR2013-00453, Paper 88 at 9-10. No such evidence
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`exists here connecting Radio with Liberty and Holdings and thus neither is an RPI.
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`If the Board considers Holdings and/or Liberty to be RPIs, Petitioner seeks
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`authorization to amend its mandatory notices without changing the Petition’s filing
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`date consistent with the Board’s precedent that the requirements of § 312(a) are not
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`jurisdictional. See, e.g., Lumentum Holdings, Inc. v. Capella Photonics, Inc.,
`
`IPR2015-00739, Paper 38 at 5 (precedential opinion). The Board has routinely
`
`permitted parties to amend their mandatory notices to name additional RPIs,
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`particularly where no evidence exists of prejudice to PO or any attempt by
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`Petitioner to circumvent the AIA’s time bar or estoppel provisions. See, e.g.,
`
`Proppant Express Investments, LLC et al. v. Oren Techs., LLC, IPR2017-02103,
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`- 3 -
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`IPR2018-00681
`U.S. Patent No. 7,061,997
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`Paper 8 at 2-3; RPX Corp. & Vimeo, Inc., v. Link Engine Techs. LLC, IPR2017-
`
`00886, Paper 11 at 4; Rubicon Comms., LP, v. Lego A/S, IPR2016-01187, Paper 40
`
`at 5 (allowing RPI “correction” because it would serve “the interests of justice”
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`and “advance the core functions” of the Trial Guide). Here, PO has not suffered
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`and cannot seriously claim any prejudice. Further, Holdings and Liberty are not
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`involved in the related litigation, and thus there are no § 315(b) time bar or §
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`315(e) estoppel concerns. Accordingly, this case falls squarely within those where
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`the Board permits parties to further identify RPIs without changing the filing date.
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`II.
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`PATENT OWNER’S ERRONEOUS CLAIM CONSTRUCTION
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`Despite PO’s suggestions to the contrary (Resp. at 34-35), the core of the
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`claim construction dispute centers on whether the portion of the preamble reciting
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`coding in the frequency domain (“in the direction of the frequency axis”) is
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`limiting. It is not. PO does not dispute that this portion of the preamble has no
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`effect on and is unrelated to the body of the claim, given that the challenged claims
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`relate to making determinations and correcting for frequency offsets in the time
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`domain. Instead, PO raises meritless arguments.
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`First, PO quotes portions of the patent specification that describe both the
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`frequency domain and the time domain. Resp. at 34-35. However, the claim
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`language at issue only involves processing of signals in the time domain by
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`“determining a phase difference between phases of the same carrier in different
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`- 4 -
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`IPR2018-00681
`U.S. Patent No. 7,061,997
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`symbols.” Ex. 1001, ¶¶ 64-91, 96-99. Indeed, PO offers no expert testimony or
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`other explanation to show how encoding in the frequency axis or frequency
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`domain can have any effect on synchronization in the time axis or time domain.
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`Am. Med. Sys., Inc. v. Biolitec, Inc., 618 F.3d 1354, 1358-59 (Fed. Cir. 2010)
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`(preamble not limiting when “deletion of the preamble phrase does not affect . . .
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`steps of the claimed invention”).
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`Second, PO argues for limiting this portion of the preamble because the
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`language was added to purportedly overcome a rejection and obtain the claim’s
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`allowance. This is not true. The claim was only allowed after the applicant added
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`a “wherein” clause that required averaging and using the average to correct for a
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`frequency offset. Ex. 2018 at 224-232, 265-269, 275-278. Under such
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`circumstances, a preamble is not limiting. Arthrex, Inc. v. Parcus Med., LLC, 2014
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`WL 3747610 at *4 (M.D. Fl. 2014) (“prosecution history clearly establishes that
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`the claims were accepted prior to the [preamble] amendment” and thus “not relied
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`upon to distinguish the claimed invention from the prior art”).
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`Finally, PO attacks Petitioner’s expert, claiming that the expert is being
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`inconsistent with the patent’s specification. Yet PO only presents attorney
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`argument divorced from the actual claim coverage and without any support from
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`its own expert. Accordingly, the only evidence presented to the Board
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`demonstrates that the “in the frequency axis” language cannot be limiting.
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`- 5 -
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`
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`Dated: June 28, 2018
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`
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`IPR2018-00681
`U.S. Patent No. 7,061,997
`
`Respectfully submitted,
`
`
`
`
`
`/Jonathan S. Caplan/
`
`Jonathan S. Caplan (Reg. No. 38,094)
`Mark Baghdassarian (pro hac vice)
`Shannon Hedvat (Reg. 68,417)
`Jeffrey H. Price (Reg. No. 69,141)
`Kramer Levin Naftalis & Frankel LLP
`1177 Avenue of the Americas
`New York, NY 10036
`Tel: 212.715.9488
`
`(Case No. IPR2018-00681)
`
`Attorneys for Petitioner
`Sirius XM Radio Inc.
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`- 6 -
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`
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`CERTIFICATE OF SERVICE
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`Pursuant to 37 C.F.R. § 42.6(e), the undersigned certifies that a true and
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`correct copy of the foregoing Petitioner’s Reply to Patent Owner’s Preliminary
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`Response, and Exhibit thereto, was served on June 28, 2018, by filing this
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`document through the PTAB E2E System as well as delivering via electronic mail
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`upon the following counsel of record for Patent Owner:
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`
`
`
`
`Ben J. Yorks (byorks@irell.com)
`Babak Redjaian (bredjaian@irell.com)
`David McPhie (dmcphie@irell.com)
`Irell & Manella LLP
`1800 Avenue of the Stars, Suite 900
`Los Angeles, CA 90067
`FraunhoferIPRs@irell.com
`
`
`
`/Jonathan S. Caplan/
`
`Jonathan S. Caplan (Reg. No. 38,094)
`Kramer Levin Naftalis & Frankel LLP
`1177 Avenue of the Americas
`New York, NY 10036
`Tel: 212.715.9488
`
`
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`- 1 -
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