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`UNITED STATES PATENT AND TRADEMARK OFFICE
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`____________
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`____________
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`EVERLIGHT ELECTRONICS CO., LTD.,
`Petitioner,
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`v.
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`DOCUMENT SECURITY SYSTEMS, INC.,
`Patent Owner.
`
`
`_______________
`
`Case IPR2018-01260
`Patent 7,919,787 B2
`____________
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`PATENT OWNER’S PRELIMINARY RESPONSE
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`PATENT OWNER’S LIST OF EXHIBITS
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`
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`Exhibit Number
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`Exhibit Description
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`2001-2099
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`Reserved
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`2100
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`2101
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`2102
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`2103
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`2104-2112
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`Complaint for Patent Infringement in Document Security
`Systems, Inc. v. Everlight Electronics Co., Ltd., and Everlight
`Americas, Inc., Case 2:17-cv-00310 (E.D. Tex.)
`Notice of Service in Document Security Systems, Inc. v.
`Everlight Electronics Co., Ltd., and Everlight Americas, Inc.,
`Case 2:17-cv-00310 (E.D. Tex.)
`Complaint for Patent Infringement in Document Security
`Systems, Inc. v. Everlight Electronics Co., Ltd., and Everlight
`Americas, Inc., Case 2:17-cv-04273 (C.D. Cal.)
`Notice of Dismissal in Document Security Systems, Inc. v.
`Everlight Electronics Co., Ltd., and Everlight Americas, Inc.,
`Case 2:17-cv-00310 (E.D. Tex.)
`Reserved
`
`
`
`
`
`IPR2018-01260 Patent Owner’s Preliminary Response
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`Pursuant to 37 C.F.R. § 42.107, Patent Owner Document Security Systems,
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`Inc. (“DSS” or “Patent Owner”) files this preliminary response to the Petition,
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`setting forth reasons why the Petition for inter partes review (“IPR”) of U.S. Patent
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`No. 7,919,787 (the “’787 patent”), claims 1-14, as requested by Everlight
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`Electronics, Co., Ltd. (“Everlight” or “Petitioner”) must be denied.1
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`I. EVERLIGHT’S PETITION FOR IPR IS TIME-BARRED
`Real party-in-interest to the Petition, Everlight Americas, Inc., was first
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`served with a complaint alleging infringement of the ’787 patent on April 26, 2017,
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`more than one year before Everlight filed its petition for IPR on June 15, 2018.
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`Therefore, Everlight’s Petition is time-barred under 35 U.S.C. § 315(b), and must
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`be denied without institution.
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`In the Petition, Everlight states that “Petitioner is not barred or estopped
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`from requesting an IPR challenging the claims on the grounds identified in herein.”
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`Pet., 3. This is incorrect, and stems from lack of disclosure of complete facts and
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`Everlight’s misapplication of the governing law. Everlight’s Petition omits that, on
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`April 26, 2017, admitted real party-in-interest Everlight Americas, Inc. (see Pet., 1)
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`1 By submitting this Preliminary Response, no waiver of any argument is intended
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`by Patent Owner. Patent Owner will have a right to file “a response to the petition
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`addressing any ground for unpatentability not already denied” should the Board
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`institute inter partes review. 37 C.F.R. § 42.120(a).
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`- 1 -
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`
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`IPR2018-01260 Patent Owner’s Preliminary Response
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`was served with a complaint dated April 13, 2017 (“Texas Complaint”), alleging
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`infringement of ’787 patent in the Eastern District of Texas. See Ex. 2100, ¶¶26-
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`32; Ex. 2101, 2. Because this named real party-in-interest to the Petition was
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`served with “a complaint,” namely the Texas Complaint, alleging infringement of
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`the patent-at-issue more than one year prior to the filing of Everlight’s Petition for
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`IPR, Everlight’s Petition is time-barred. See 35 U.S.C. § 315(b).
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`Everlight appears to believe that the service date of April 26, 2017 should
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`not bar the untimely filing of this Petition because DSS dismissed the Texas
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`Complaint without prejudice on June 8, 2017. Ex. 2103, 2. Under the plain
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`language of the 35 U.S.C. 315(b) and governing Federal Circuit law, that
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`subsequent dismissal of the complaint is irrelevant to whether Everlight Americas,
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`Inc. was served with the complaint alleging infringement of the ’787 patent, and
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`therefore whether Petitioner was barred from filing a petition for inter partes
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`review of the ’787 patent after April 26, 2018. See Click-to-Call Tech., LP v.
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`Ingenio, Inc., ___ F.3d ___, slip op. at 10 (Fed. Cir. 2018).2
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`2 “The principal question on appeal is whether the Board erred in interpreting the
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`phrase ‘served with a complaint alleging infringement of [a] patent’ recited in §
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`315(b) such that the voluntary dismissal without prejudice of the civil action in
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`which the complaint was served ‘does not trigger’ the bar. Final Written Decision,
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`slip op. at 12. We hold that it did.”
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`- 2 -
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`IPR2018-01260 Patent Owner’s Preliminary Response
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`That Petitioner Everlight was not served with the Texas Complaint does not
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`permit Everlight to carry on with this untimely Petition. Everlight identifies both
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`itself and Everlight Americas, Inc. as real parties-in-interest in the Petition. Pet., 1.
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`And the evidence clearly shows that on April 26, 2017, more than a year before the
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`filing of this Petition, real party-in-interest Everlight Americas, Inc. was served
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`with the Texas Complaint, alleging infringement of ’787 patent. See Ex. 2100,
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`¶¶26-32; Ex. 2101, 2. As the Federal Circuit acknowledged, the time bar of §
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`315(b) is trigged by service of a complaint on the petitioner or real party-in-
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`interest: “the text of § 315(b) clearly and unmistakably considers only the date on
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`which the petitioner, its privy, or a real party in interest was properly served with a
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`complaint.” Click-to-Call Tech., slip op. at 17.
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`Even if a dismissal without prejudice could operate to reset the time-bar
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`provision under § 315(b) in some circumstances, here DSS dismissed its case
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`against Everlight in Texas and concurrently refiled its complaint in the Central
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`District of California3, thereby continuously maintaining its infringement action
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`against the Everlight entities. The Supreme Court issued its decision in TC
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`Heartland LLC v. Kraft Foods Group Brands LLC, 581 U.S. ___, 137 S. Ct. 1514
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`(2017) on May 22, 2017, after DSS filed its Texas complaint. TC Heartland
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`served to restrict the venue in which a particular patent infringement complaint
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`3 This document will be referred to as the “California Complaint.”
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`- 3 -
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`
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`IPR2018-01260 Patent Owner’s Preliminary Response
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`could be brought. In view of that intervening decision, DSS shifted its
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`infringement action against Everlight to the Central District of California, by
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`concurrently refiling the counts from the Texas complaint in the California
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`Complaint and dismissing the Texas complaint, both on June 8, 2017. Cf, Ex.
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`2100, ¶¶26-32 with Ex. 2102, ¶¶26-32; Ex. 2103, 2. Accordingly, as there was no
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`gap in the charge of infringement, and by the statute’s plain language, the time-bar
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`of 35 U.S.C. § 315(b) runs from the first service of “a complaint alleging
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`infringement” of the ’787 patent real party-in-interest Everlight Americas, Inc. on
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`April 26, 2017. See Click-to-Call Technologies, LP v. Ingenio, Inc., ___ F.3d ___
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`(Fed. Cir. 2018).
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`Finally, Everlight cannot salvage its time-barred petition by filing a later-
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`filed motion for joinder. The PTO’s regulations expressly prohibit the filing of a
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`time-barred petition, and only provide an exception where a petition is
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`“accompanied” by a motion for joinder: “[t]he time period set forth in § 42.101(b)
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`shall not apply when the petition is accompanied by a request for joinder.” 37
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`C.F.R. § 42.122(b) (emphasis added). Everlight’s Petition was not accompanied
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`by a motion for joinder. Similarly, nothing in the IPR statutes permits conversion
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`of an untimely petition into a request for joinder based on later filings that are not
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`concurrent with, i.e. accompanying, the petition.
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`- 4 -
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`IPR2018-01260 Patent Owner’s Preliminary Response
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`Because Everlight’s Petition was filed more than a year after real party-in-
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`interest Everlight Americas, Inc. was served with a complaint alleging
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`infringement of the ’787 patent, Everlight’s Petition is time-barred under 35 U.S.C.
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`§ 315(b) and must be denied.
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`II.
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`CONCLUSION
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`For the reasons presented above, the Petition is time-barred and must be
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`denied.
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`Dated: August 31, 2018
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`
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`
`
`/s/ Wayne M. Helge
`Wayne M. Helge (Reg. No. 56,905)
`James T. Wilson (Reg. No. 41,439)
`Aldo Noto (Reg. No. 35,628)
`DAVIDSON BERQUIST JACKSON &
`GOWDEY, LLP
`8300 Greensboro Dr., Suite 500
`McLean, VA 22102
`Telephone: (571) 765-7700
`Fax : (571) 765-7200
`Email: whelge@dbjg.com
`Email: jwilson@dbjg.com
`Email: anoto@dbjg.com
`
`Counsel for Patent Owner
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`- 5 -
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`IPR2018-01260 Patent Owner’s Preliminary Response
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`CERTIFICATE OF WORD COUNT
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`The undersigned certifies that the foregoing PATENT OWNER’S
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`PRELIMINARY RESPONSE complies with the type-volume limitation in 37
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`C.F.R. § 42.24(b)(1). According to the word-processing system’s word count, the
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`brief contains 1,001 words, excluding the parts of the brief exempted by 37 C.F.R.
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`§ 42.24(a).
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`
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`
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`By: /s/ Wayne M. Helge
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`Wayne M. Helge (Reg. No. 56,905)
`Attorney for Patent Owner
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`- 6 -
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`IPR2018-01260 Patent Owner’s Preliminary Response
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`CERTIFICATE OF SERVICE
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`The undersigned hereby certifies that this PATENT OWNER’S
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`PRELIMINARY RESPONSE was served to Petitioner by serving the
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`correspondence email addresses of record as follows:
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`John F. Rabena (Reg. No. 38,584)
`jrabena@sughrue.com
`William H. Mandir (Reg. No. 32,156)
`wmandir@sughrue.com
`SUGHRUE MION, PLLC
`2100 Pennsylvania Ave., N.W.
`Suite 800
`Washington, DC 20037
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`
`
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`Dated: August 31, 2018
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`
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`
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`/s/ Wayne M. Helge
`Wayne M. Helge (Reg. No. 56,905)
`Attorney for Patent Owner
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`- 7 -
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