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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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`APPLE INC.,
`ZTE (USA) INC.
`Petitioners
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`v.
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`INVT SPE LLC
`Patent Owner
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`Case No. 2018-01477
`U.S. Patent No. 7,848,439
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`REPLY TO PATENT OWNER PRELIMINARY RESPONSE
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`I.
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`INTRODUCTION
`As authorized by the Board (Paper 8), Petitioners submit this Reply to Patent
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`IPR2018-01477
`U.S. Patent 7,848,439
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`Owner’s argument that a parallel investigation before the International Trade
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`Commission (“ITC”) justifies denying institution “for efficiency reasons,” on the
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`grounds that IPR would be duplicative of the ITC investigation. Paper 7 at 60-62.
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`Patent Owner’s position is meritless, not least because the ITC—unlike the PTAB
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`in an IPR—is not “empowered under existing law to set aside a patent as being
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`invalid or to render it unenforceable.” Bio-Tech. Gen. Corp. v. Genentech, Inc., 80
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`F.3d 1553, 1564 (Fed. Cir. 1996).
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`This Board has recently rejected the precise argument advanced by Patent
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`Owner. Wirtgen Am., Inc., et al. v. Caterpillar Paving Products Inc., IPR2018-
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`01202, Paper 10 at 10 (PTAB Jan. 8, 2019). The relevant facts of Wirtgen are
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`identical to the present proceeding. In Wirtgen, the patent owner argued that
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`“instituting inter partes review would be inefficient and would waste the Board’s
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`resources” in view of an ongoing ITC proceeding involving similar invalidity ground
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`and with an earlier ruling date. Id. at 9. There—as it should here—the Board soundly
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`rejected this argument, stating that the “ITC’s decision in the co-pending
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`investigation…does not render our proceeding duplicative or amount to a waste of
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`the Board’s resources.” Id. at 10. Finally, Patent Owner’s position amounts to a
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`policy where any ITC action filed after an IPR petition is grounds for denying
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`institution. Patent Owners, as a general matter of policy, should not be allowed to
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`subvert and avoid the Board’s authority by filing a post-hoc proceeding before the
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`IPR2018-01477
`U.S. Patent 7,848,439
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`ITC. This type of gamesmanship should not be countenanced.
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`II. THE BOARD SHOULD INSTITUTE IPR BECAUSE THE ITC
`ACTION INVOLVES DIFFERING REMEDIES, STANDARDS, AND
`INVALIDITY GROUNDS
`Patent Owner erroneously argues that because the same prior art may be at
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`issue in both proceedings, “[c]onducting an IPR on that prior art will be repetitive to
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`the ITC proceeding.” Paper 7 at 61-62 (emphasis added). But Patent Owner fails to
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`appreciate the overt distinctions between these proceedings, including their distinct
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`remedies, distinct standards, and differing invalidity grounds that may be pursued.
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`A. The IPR is non-duplicative of the ITC proceeding because each
`have different remedies that reflect the different functions of the
`distinct administrative bodies.
`Section 7 of the AIA granted the PTAB authority to review adverse decisions
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`of examiners, review appeals of reexaminations, conduct derivation proceedings,
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`and conduct IPRs and post-grant reviews—all functions directed to ensuring only
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`novel and nonobvious patent claims are deemed valid. AIA § 7. Specific to IPRs,
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`this AIA-created proceeding allows a petitioner to “request to cancel as
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`unpatentable 1 or more claims of a patent only on a ground that could be raised
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`under section 102 or 103.” 35 U.S.C. § 311(b) (emphasis added). Thus, the remedy
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`in an IPR proceeding is cancelling challenged claims.
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`In contrast, Section 337 of the Tariff Act of 1930, which defines the ITC’s
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`authority, was enacted to protect patent owners against infringing imported products.
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`2
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`Pursuant to Section 337, the ITC may exclude articles at issue from entry into the
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`IPR2018-01477
`U.S. Patent 7,848,439
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`United States, issue a cease and desist order, and/or issue an order to seize and forfeit
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`the articles in violation to the United States. 19 U.S.C. § 1337(d), (f), and (i). But
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`the ITC is not “empowered under existing law to set aside a patent as being invalid
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`or to render it unenforceable.” Bio-Tech. Gen. Corp, 80 F.3d at 1564 (noting the ITC
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`may only “take into consideration [invalidity] defenses and [] make findings thereon
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`for the purposes of determining whether section 337 is being violated”); see also
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`Wirtgen Am. Inc., et al. v. Caterpillar Paving Products Inc., IPR2018-01201, Paper
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`13 at 12 (PTAB Jan. 8, 2019) (Wirtgen II) (confirming this view).1
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`B.
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`The IPR is non-duplicative because the ITC applies different claim
`construction standards and burdens of proof.
`For IPR petitions filed before Nov. 13, 2018, like the petition at issue here,
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`the Board applies a Broadest Reasonable Interpretation (“BRI”) standard for
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`interpreting claim language. 37 C.F.R. § 42.100(b); see also RPX Corp. v.
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`Publishing Tech., LLC, IPR2018-01131, Paper 10 at 7-8, n. 6 (PTAB Dec. 3, 2018)
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`(noting that Phillips will apply to Petitions filed on or after Nov. 13, 2018, but
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`clarifying that “this rule does not apply retroactively”). The ITC, however, uses the
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`same claim construction standard used by Article III federal courts (i.e., the Phillips
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`1 The Senate Report accompanying the Trade Act of 1974 clarified that the
`Commission's primary responsibility is to administer the trade laws, not the patent
`laws. S. Rep. No. 93-1298, 93d Cong.; 2d Sess. (1974) at 197-198.
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`3
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`standard). These differing standards justify and may require that parties take
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`IPR2018-01477
`U.S. Patent 7,848,439
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`independent, different positions on claim construction in each forum. Caterpillar,
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`Inc. v. Wirtgen Am., Inc., IPR2017-02188, Paper 8 at 12 (PTAB May 23, 2018)
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`(holding that different claim construction positions under § 112(6) in a parallel ITC
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`investigation are justified). In Caterpillar, the Board noted that the differing legal
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`and evidentiary standards may even justify inconsistencies between the fora. Id.
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`Further, invalidity in the ITC (for purposes of determining whether a section
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`337 violation has occurred) must be proven by clear and convincing evidence.
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`Linear Tech. Corp. v. Int'l Trade Comm'n, 566 F.3d 1049, 1066 (Fed. Cir. 2009).
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`But, in an IPR proceeding, a petitioner must establish unpatentability only by a
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`preponderance of the evidence. 35 U.S.C. § 316(e).
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`The differing claim construction standards and burdens of proof have led
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`panels in past IPR proceedings to reject ITC findings as not determinative of even
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`the same substantive issues in an IPR proceeding. Asustek Computer, Inc., et al. v.
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`Avago Technologies General IP (Singapore) Pte. Ltd., IPR2016-00646, Paper 11 at
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`20 (PTAB Aug. 22, 2016). It follows that Patent Owner’s request to avoid this IPR
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`proceeding in favor of a non-determinative ITC investigation should be rejected.
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`C. The IPR is non-duplicative because IPR and ITC proceedings
`permit different invalidity theories and issues.
`IPR proceedings are limited to §§ 102-103 theories based solely on patents or
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`printed publications. 35 U.S.C. § 311(b). By contrast, in the ITC a respondent may
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`4
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`pursue other invalidity theories, including challenges under §§ 101 and 112 and §§
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`IPR2018-01477
`U.S. Patent 7,848,439
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`102-103 based on prior art other than patents and printed publications. 19 U.S.C. §
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`1337(c).
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`These distinctions are particularly relevant here, where the limitations
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`imposed in IPR proceedings mandate differing claim constructions. Namely,
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`Petitioners argue in the ITC that Claims 1-3 are indefinite under Phillips, because
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`certain limitations are written in means-plus-function (§ 112(6)) format without
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`corresponding structure in the specification—arguments unavailable in the IPR. By
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`contrast, here Petitioners interpreted these limitations pursuant to the BRI and
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`assumed for purposes of the Petition that the limitations are definite—an assumption
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`that practically results in limitations defined by their recited functions because there
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`is insufficient corresponding structure available to pursue a § 112(6) construction.
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`The PTAB has found a petitioner justified in applying, as here, a § 112(6)
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`construction in a parallel ITC investigation but not in IPR based, in part, on the
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`different standards applied in the respective proceedings. Caterpillar, Inc., IPR2017-
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`02188, Paper 8 at 12. Where, as here, a patentee invokes § 112(6) without describing
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`corresponding structure, invalidity should be assessed in an IPR (where
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`indefiniteness is unavailable) pursuant to the broadest reasonable meaning that can
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`be ascribed that limitation.
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`IPR2018-01477
`U.S. Patent 7,848,439
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`Respectfully submitted,
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`/s/ Adam P. Seitz
`Adam P. Seitz, Reg. No. 52,206
`Paul R. Hart, Reg. No. 59,646
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`COUNSEL FOR PETITIONERS
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`IPR2018-01477
`U.S. Patent 7,848,439
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`CERTIFICATE OF SERVICE
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`The undersigned certifies that on January 16, 2019, a true and correct copy
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`of this reply to Patent Owner’s Preliminary Response was served upon the
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`following counsel for Patent Owner, via the email correspondence address of
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`record:
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`Cyrus Morton, Reg. 44,954, cmorton@robinskaplan.com
`Bryan Vogel, Reg. 44,389, bvogel@robinskaplan.com
`Derrick Carman, Reg. 68,935, dcarman@robinskaplan.com
`Li Zhu, Reg. 73,465, lzhu@robinskaplan.com
`Shui Li, Reg. 74,617, sli@robinskaplan.com
`Stephanie Diehl, Reg. 71,830, sdiehl@robinskaplan.com
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`BY: Paul R. Hart
`Paul R. Hart, Reg. No. 59,646
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`ATTORNEY FOR PETITIONER
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`7
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