IPR2018-00883, Paper 24
`U.S. Patent 8,934,535
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`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________________________________________
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________________________________________
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`UNIFIED PATENTS INC.
`Petitioner
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`v.
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`REALTIME ADAPTIVE STREAMING, LLC
`Patent Owner
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`IPR2018-00883
`U.S. Patent 8,934,535
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`SYSTEMS AND METHODS FOR VIDEO AND AUDIO DATA STORAGE
`AND DISTRIBUTION
`____________________
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`[REDACTED] PETITIONER’S RESPONSE TO
`PATENT OWNER’S SUPPLEMENTAL BRIEF ON
`REAL PARTIES IN INTEREST
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`U.S. Patent 8,934,535
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`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________________________________________
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________________________________________
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`UNIFIED PATENTS INC.
`Petitioner
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`v.
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`REALTIME ADAPTIVE STREAMING, LLC
`Patent Owner
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`
`IPR2018-00883
`U.S. Patent 8,934,535
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`SYSTEMS AND METHODS FOR VIDEO AND AUDIO DATA STORAGE
`AND DISTRIBUTION
`____________________
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`[REDACTED] PETITIONER’S RESPONSE TO
`PATENT OWNER’S SUPPLEMENTAL BRIEF ON
`REAL PARTIES IN INTEREST
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`IPR2018-00883, Paper 24
`U.S. Patent 8,934,535
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`TABLE OF CONTENTS
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`Unified Is the Sole RPI Under the Applicable Standard ................................. 2
`Realtime’s RPI Arguments Lack Merit ........................................................... 6
`A.
`Realtime’s Benefit-Plus-Relationship Standard Is Contrary to
`AIT and Yields Untenable Results ........................................................ 6
`B. Unified’s Members Are Not RPIs Under Realtime’s “Attorney-
`in-Fact” or “Agent” Theory ................................................................... 7
`C. Unified’s Members Are Not RPIs Under Realtime’s
`“Association” Theory ............................................................................ 9
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`I.
`II.
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`IPR2018-00883, Paper 24
`U.S. Patent 8,934,535
`In more than 110 IPR petitions, Petitioner Unified has certified it is the sole
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`real party-in-interest (“RPI”) under § 312(a)(2). Each time that identification has
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`been challenged, the Board has held Unified’s members are not RPIs.1 Rather than
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`distinguish any prior decisions, Patent Owner (“Realtime”) incorrectly argues that
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`Applications in Internet Time, LLC v. RPX Corp., 897 F.3d 1336 (Fed. Cir. 2018)
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`(AIT), upends them all to now require identifying nearly 200 companies as RPIs. In
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`doing so, Patent Owner not only ignores this case’s materially different facts, but
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`also ignores the context of the 315(b) bar—a context not present here. The Board
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`should institute this IPR and deny Realtime’s challenge.
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`1 See, e.g., Clouding IP, IPR2013-00586, Paper 9 (2014); Dragon IP., IPR2014-
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`01252, Paper 37 (2015); iMTX Strategic, IPR2015-01061, Paper 9 (2015); Hall
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`Data, IPR2015-00874, Paper 11 (2015); TransVideo, IPR2015-01519, Paper 8
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`(2016); Qurio, IPR2015-01940, Paper 7 (2016); Nonend, IPR2016-00174, Paper 10
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`(2016); Am. Vehicular, IPR2016-00364, Paper 13 (2016); Plectrum, IPR2017-
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`01430, Paper 8 (2017); Digital Stream IP, IPR2016-01749, Paper 22 (2018); Fall
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`Line Pts., IPR2018-00043, Paper 6 (2018); MONKEYMedia, IPR2018-00059, Paper
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`15 (2018); Uniloc, IPR2017-02148, Paper 9 (2018) (nonexaustive).
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`1
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`I.
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`IPR2018-00883, Paper 24
`U.S. Patent 8,934,535
`Unified Is the Sole RPI Under the Applicable Standard
`The Petition correctly certifies Unified Patents Inc. as the sole RPI under
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`§ 312(a)(2). RPI is interpreted under its common-law meaning—codified in Federal
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`Rule 17(a).2 Trial Practice Guide (“TPG”), 77 Fed. Reg. 48,756, 48759; AIT, 897
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`F.3d at 1346-51. An RPI is the person entitled to enforce the right being asserted.
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`AIT at 1348 (citing Wright & Miller § 1543). The TPG, citing Taylor v. Sturgell,
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`states that RPI is a “highly fact-dependent question… assessed on a case-by-case
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`basis” while expanding on Rule 17 with additional factors related to principles of
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`preclusion. TPG, 48759 (citing Taylor, 553 U.S. 880, 893-895 (2008)). In Taylor,
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`the Supreme Court confirmed that nonparties are not bound by prior judgments
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`except in “discrete exceptions that apply in ‘limited circumstances,’” including
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`where the named party is a proxy or agent for the nonparty. 553 U.S. at 893-95, 898.
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`The TPG, in applying Taylor, identifies factors that may justify such preclusion,
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`including: whether a non-party is funding, directing, or controlling the IPR; the
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`nonparty’s relationships with petitioner and the petition, including involvement in
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`the filing; and the nature of the entity filing the petition. 77 Fed. Reg. at 48,759-60;
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`2 Rule 17(a) limits persons who are considered RPIs to persons with seven types of
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`relationships with the entity entitled to sue, e.g., executors and guardians. No such
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`relationships exist here and Realtime never mentions Rule 17(a).
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`2
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`IPR2018-00883, Paper 24
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`see Sirius XM Radio, IPR2018-00681, Paper 12 at 3-4 (Sept. 6, 2018) (quoting TPG).
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`Applying these controlling factors here, Realtime does not dispute that:
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`(1) Unified solely directed, controlled, and funded this IPR; (2) no member
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`communicated with Unified or knew about the IPR before it was filed; and (3) no
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`member has participated in this IPR, either explicitly or implicitly.
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` This confirms Unified as the sole RPI, as the Board has
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`routinely found. See, e.g., Dragon IP, IPR2014-01252, Paper 37 at 12 (“even if we
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`accept Patent Owner’s allegations that Petitioner engages in no activity of practical
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`significance other than filing IPR petitions with money received from its members,
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`this does not demonstrate that” Unified’s members were unnamed RPIs.); supra n.1.
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`AIT clarified the Board’s RPI standard.3 In AIT, the Federal Circuit applied
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`the traditional fact-intensive “flexible approach that takes into account both
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`equitable and practical considerations” consistent with the TPG. AIT, 897 F.3d at
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`1351 (Fed. Cir. 2018). The Court looked at direction, funding, and control as
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`touchstones, and in the context of § 315(b) remanded for further consideration with
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`“an eye toward determining whether the nonparty is a clear beneficiary that has a
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`3 Worlds Inc. v. Bungie, Inc., decided last week, noted that AIT “clarif[ied] the
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`meaning of the term ‘real party in interest’ in the context of § 315(b).” No. 2017-
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`1481, 2018 WL 4262564, at *7 (Fed. Cir. Sept. 7, 2018).
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`3
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`U.S. Patent 8,934,535
`preexisting, established relationship with the petitioner.” Id. Specifically, the court
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`remanded for further consideration of whether RPX was an agent or proxy of a
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`particular client—Salesforce. 897 F.3d at 1343. The relevant facts, which the court
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`held were not meaningfully considered by the panel, go to whether Salesforce
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`desired review after being itself time-barred, made payments connected to the IPR,
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`was the intended beneficiary of the IPR, and was the party at whose behest RPX
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`filed the petition—all of which suggested funding, direction, and control. See id.
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`at 1351-58. None of these salient facts from AIT exist here. See id. To the contrary:
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`• Unified has no attorney-client relationship with its members and is not an
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`extension of any member’s in-house legal team. AIT, 897 F.3d at 1357, 1362;
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`Declaration of Kevin Jakel (Ex.1018, “Jakel”), ¶ 4.
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`• Unified works on behalf of zones. Ex. 2003, 13-16. It does not work for
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`members to resolve their litigations. Jakel, ¶ 3. Here, Unified filed one IPR against
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`some claims of one of several asserted patents in Realtime’s parallel litigations,
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`without insight, input, or direction from its members. Id.
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`• No Unified member made a “very significant payment shortly before” the
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`petition was filed. AIT, 897 F.3d at 1342; Jakel, ¶ 5.
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`• There was no offer to, or request by, members for Unified to reach out to
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`Realtime concerning the litigation(s). AIT, 897 F.3d at 1341-42; Jakel, ¶ 7.
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`• Unified did not communicate with any member to ascertain their desires
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`and coordinate strategies, and it did not take last-minute efforts to avoid an express
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`statement of coordination. AIT, 897 F.3d at 1341-42; Jakel, ¶ 8.
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`• No Unified member had an earlier petition denied or was otherwise time-
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`barred from filing an IPR petition. 897 F.3d at 1353.
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`The record shows that Unified did not file this IPR for the desire, payment, or
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`benefit of any particular member, or at the behest of any member. Jakel, ¶ 9. Unified
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`5
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`U.S. Patent 8,934,535
`is thus the sole RPI and did not act as a proxy for any company.
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`II. Realtime’s RPI Arguments Lack Merit
`A. Realtime’s Benefit-Plus-Relationship Standard Is Contrary to AIT
`and Yields Untenable Results
`Realtime’s proposed benefit-plus-relationship standard overextends the
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`applicable RPI analysis, including Taylor’s principles of preclusion and AIT.
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`Realtime urges an oversimplified, expansive standard whereby any “real party in
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`interest is one ‘who will benefit’ from an IPR.” Br. 1. AIT, however, approvingly
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`cites the TPG and the Board’s long-applied RPI standard, one which does not soley
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`“turn on who ‘will benefit.’” Br. 3. Who is a clear beneficiary is just one of several
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`factors that may be considered. AIT, 897 F.3d at 1343, 1347, 1352.
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`Under Realtime’s standard, any relationship plus any benefit makes a
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`nonparty an RPI. This is unworkable.4 For example, all companies involved in a
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`JDG would become RPIs, as they have a relationship (i.e., an agreement to jointly
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`coordinate regarding a legal defense) and could potentially receive a benefit (e.g.,
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`the filing of a challenge). As another example, entire technology sectors full of
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`competitors would need to be identified as RPIs, since entities operating in that
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`4 Moreover, looking for any relationship contradicts the Supreme Court’s rejection
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`of basing non-party preclusion on whether its relationship was “close enough” to a
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`prior party. Taylor, 553 U.S. at 898-901.
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`6
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`U.S. Patent 8,934,535
`technology sector have relationships with each other and might benefit from a
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`challenge. In Realtime’s view, this would hold true regardless of whether a company
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`was accused of infringing the patent-at-issue. This is not the correct standard for
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`RPI.
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`B. Unified’s Members Are Not RPIs Under Realtime’s “Attorney-in-
`Fact” or “Agent” Theory
`Realtime’s meritless “attorney-in-fact” or “agent” theory implies that the
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`Board erred in all RPI decisions prior (and subsequent) to AIT. Realtime argues that
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`“Unified acts as attorney-in-fact because the members hire it with full knowledge
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`that most of their fees will be used to file petitions.” Br. 8. This is disconnected from
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`the common law of RPI and preclusion principles. Indeed, when considering agent
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`preclusion, the Supreme Court warned:
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`[C]ourts should be cautious about finding preclusion on
`this basis. A mere whiff of “tactical maneuvering” will not
`suffice; instead, principles of agency law are suggestive.
`They indicate that preclusion is appropriate only if the
`putative agent’s conduct of the suit is subject to the control
`of the party who is bound by the prior adjudication.
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`Taylor, 553 U.S. at 906 (emphasis added); Wright & Miller § 4454 & n.19. Here,
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`Unified did not act as an agent of any member, and the facts in AIT suggesting that
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`RPX was acting as Salesforce’s agent are absent here, as shown above.
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`Also, Unified’s independence means its IPRs are not coordinated with
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`IPR2018-00883, Paper 24
`U.S. Patent 8,934,535
`member’s litigation strategies. In AIT, the court considered whether RPX may have
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`been aligned with Salesforce because it was working specifically for and in
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`coordination with Salesforce. AIT, 897 F.3d at 1363. Here, Realtime cannot point to
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`any communications discussing the Patent Owner’s patent or their related litigation.
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`Nor is there any evidence that Unified was aware of its members’ litigation
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`strategies.
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` Unified does not know its members’ litigation
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`strategies or settlement status, as Unified has no attorney-client relationship or joint
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`defense group with its members and does not coordinate with its members. Jakel,
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`¶ 11.
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`IPR2018-00883, Paper 24
`U.S. Patent 8,934,535
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`C. Unified’s Members Are Not RPIs Under Realtime’s “Association”
`Theory
`Realtime’s “association” theory likewise fails. Realtime argues that members
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`of Unified’s Content Zone—a technology area involving content-related subject
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`matter—are all RPIs by association because “[Unified] can and does file IPRs to
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`serve its clients’ financial interests, and that [is] a key reason clients pay.” Br. 8. But
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`the law on association preclusion, which Realtime omits, lends them no support.
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`Realtime cites no precedent showing that paid membership combined with some
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`shared interest, without more, warrants preclusion. Ordinarily, preclusion requires
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`participation and control—an association’s mere “interest as an advocate of the
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`interests of its members” is not sufficient. Wright & Miller, § 4451. Wright & Miller
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`explains that: “great care should be taken before binding all members to an
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`association loss” and “[a]ny member who actively participated in the first action
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`should . . . be barred . . . . Other members, however, should not be precluded.” Id.
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`§ 4456; see Coors Brewing Co. v. Mendez-Torres, 562 F.3d 3, 19-21 (1st Cir. 2009)
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`(finding Coors was not precluded based on a lost action of Association). All that
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`presupposes there is something to preclude them from—some previous action to
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`which they should be bound. And nothing in AIT suggests that Realtime’s
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`association preclusion would apply here. See AIT, 897 F.3d at 1351. As discussed
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`above, the facts here are materially different.
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`Unified’s business model further negates Realtime’s association theory,
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`because its business aligns not with any member, but with the interest of deterring
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`poor-quality patent assertions in technology zones. EX2003 at 13.
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`Date: September 10, 2018
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`Respectfully Submitted,
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`/Lionel M. Lavenue/
`Lionel M. Lavenue (Reg. No. 46,859)
`10
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`CERTIFICATE OF SERVICE
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`IPR2018-00883, Paper 24
`U.S. Patent 8,934,535
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`The undersigned certifies that a copy of the foregoing PETITIONER’S
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`RESPONSE TO PATENT OWNER’S SUPPLEMENTAL BRIEF ON REAL
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`PARTIES IN INTEREST was filed on PTABE2E and served on September 10,
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`2018, via email directed to counsel of record for the Patent Owner at the following:
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`William P. Rothwell
`william@noroozipc.com
`Kayvan B. Noroozi
`kayvan@noroozipc.com
`Joel P.N. Stonedale
`joel@noroozipc.com
`NOROOZI PC
`2245 Texas Drive, Suite 300
`Sugar Land, TX 77479
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`Thomas C. Chen
`NOROOZI PC
`1299 Ocean Ave., Suite 450
`Santa Monica, CA 90401
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`Neil A. Rubin
`nrubin@raklaw.com
`Kent Shum
`kshum@raklaw.com
`RUSS AUGUST & KABAT
`12424 Wilshire Blvd., 12th Fl.
`Los Angeles, CA 90025
`
`
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`
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`By: /Lisa C. Hines/
`Lisa C. Hines
`Litigation Legal Assistant
`FINNEGAN, HENDERSON, FARABOW,
`GARRETT & DUNNER, LLP
`11
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`Dated: September 10, 2018
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