`571-272-7822
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`Paper No. 21
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`RALPH LAUREN CORPORATION,
`Petitioner,
`
`v.
`
`LEXOS MEDIA IP, LLC,
`Patent Owner.
`____________
`
`Case IPR2018-01749 (Patent 5,995,102)
`Case IPR2018-01755 (Patent 6,118,449)
`____________
`
`Record of Oral Hearing
`Held: January 6, 2020
`____________
`
`Before PHILLIP J. KAUFMAN, J. JOHN LEE, and
`SHARON FENICK, Administrative Patent Judges.
`
`
`
`Case IPR2018-01749 (Patent 5,995,102)
`Case IPR2018-01755 (Patent 6,118,449)
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`
`
`APPEARANCES:
`
`ON BEHALF OF THE PETITIONER:
`
`
`JAMES F. VALENTINE, ESQUIRE
`VICTORIA SMITH, ESQUIRE
`Perkins Coie
`3150 Porter Drive
`Palo Alto, CA 94304-1212
`
`
`
`ON BEHALF OF THE PATENT OWNER:
`
`
`TAREK N. FAHMI, ESQUIRE
`Ascenda Law Group
`333 West San Carlos Street
`Suite 200
`San Jose, California 95110-2730
`
`
`
`
`The above-entitled matter came on for hearing on Monday, January 6,
`2020, commencing at 10:01 a.m., at the U.S. Patent and Trademark Office,
`600 Dulany Street, Alexandria, Virginia.
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`Case IPR2018-01755 (Patent 6,118,449)
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`P R O C E E D I N G S
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`MR. EASTON: All rise.
`JUDGE FENICK: Good morning. Please be seated. Just bear with
`us one moment.
`JUDGE LEE: Judge Kaufman, can you hear us okay?
`JUDGE KAUFMAN: I can hear you fine, thank you.
`JUDGE LEE: All right, great. Just give us one moment, I think we
`are having some technical issues. I thought the patent office wasn’t allowed
`to have technical issues, right. Technology agency, isn’t it always supposed
`to work for us?
`OFF THE RECORD
`ON THE RECORD
`JUDGE LEE: Back up?
`JUDGE FENICK: Yeah, thank you. Sorry for the delay. Thank you.
`Good morning. We will hear argument now in case number IPR 2018-1749,
`Ralph Lauren Corporation v. Lexos Media IP, LLC, concerning Patent
`Number 5,995,102. And case number IPR 2018-01755, Ralph Lauren
`Corporation v. Lexos Media IP LLC, concerning Patent Number 6,118,449.
`Counsel for the parties please introduce yourselves starting with
`petitioner.
`MR. VALENTINE: Good morning, Your Honor. James Valentine
`from the law firm of Perkins Coie on behalf of petitioner Ralph Lauren and
`real parties and interests.
`JUDGE FENICK: Thank you.
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`MS. SMITH: Victoria Smith for Ralph Lauren.
`MR. FAHMI: Good morning, Your Honors. Tarek Fahmi on behalf
`of patent owner.
`JUDGE FENICK: Thank you. Welcome to the Board. Per our order
`dated December 18, 2019, each side will have one hour to argue. Petitioner
`will argue first and may reserve rebuttal time. Patent owner will respond
`and may reserve time for sur rebuttal.
`I remind the parties that the petitioner bears the burden of providing
`any proposition of unpatentability by a preponderance of the evidence. I
`also remind the parties that this hearing is open to the public and a full
`transcript will become part of the record.
`Please bear in mind also that Judge Kaufman is attending this hearing
`by video and if you refer to slides, please remember also to mention each
`slide number as you refer to it so that it is reflected in the record. This is
`especially important in order to ensure that Judge Kauffman can follow the
`proceedings even if the video link is interrupted. With that, I invite Mr.
`Valentine to begin.
`MR. VALENTINE: Thank you, Your Honors.
`JUDGE FENICK: Good morning. Would you like to reserve time for
`rebuttal?
`MR. VALENTINE: Yes, please. I’d like to reserve 10 minutes for
`rebuttal. I'm turning to Demonstrative Number 2. In our presentation
`today we're going to cover five issues. I've enumerated them in
`Demonstratives Number 2 and 3. I’ll just briefly preview them now.
`The first issue and most important from the vantage point of petitioner
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`is whether the petitioner has demonstrated that the combination of Malamud
`plus Anthias discloses limitations 1 [c.][iv] and 1[c.][iii].
`Preliminarily in its institution decision, the panel found that petitioner
`had not shown the prior art discloses limitation 1 [c.][iv]. We respectfully
`submit that that was based on a misapprehension of patent owners or
`petitioners argument. And so we hope to prove today that under the
`argument that petitioner actually made, that limitation 1 [c.][iv] is shown in
`the prior art.
`The reason why for the misapprehension was with respect to
`limitation 1 [c.][iii]. So the Board did not actually consider the correct
`argument for 1 [c.][iii] either. So after we get through 1 [c.][iv] we are going
`to backtrack to 1 [c.][iii] even though the Board preliminarily found that was
`satisfied.
`We believe the Board may not have clearly understood the argument
`we were making so we want to make sure that the Board has an opportunity
`to address that argument with respect to that limitation.
`Turning to Demonstrative Number 3, these are the remaining four
`issues to be addressed. The second is whether petitioner has demonstrated
`that Baker plus Anthias disclosed transmitting specified content information
`to said remote terminal as claimed in limitations 1 [c.][i] through 1 [c.][iii].
`And the limitations we are referring to exemplary Claim 1 of the 449
`patent. So by way of convention today when we cite to the patents we are
`probably, we're going to cite primarily to the 102 because that was a
`convention the parties employed in the papers.
`However, when we talk about institution decisions, we are going to
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`lead with the 449 institution decision because that was the first issued
`decision and all of the 102 issues are subsumed by the 449 issues. I won’t
`read through the rest of the issues on Demonstrative Number 3. We will lay
`them out when we get to them.
`Turning to Demonstrative Number 4, the challenged patents. I want
`to say just a brief introduction of what these patents do. The concept here is
`to modify a cursor image to reflect advertising content in a client server
`architecture.
`The background of this is that advertising material was typically
`delivered via pop up ads or banner ads across the top of a screen or panel ads
`on the side and those could be easily ignored by the user.
`So what this inventor came up was to, let’s modify the cursor which is
`where the user has focused his or her attention and do that depending upon
`where the cursor is to reflect advertising content.
`Turning to Demonstrative Number 5. This is just the summary of the
`499 patent. It says there is a simple means -- a need for a simple means to
`deliver advertising elements without the annoyance of totally interrupting an
`intrusive content delivery and without the passiveness of ordinary banner
`and frame advertisements.
`Turning to Demonstrative Number 6. This is an example of one of the
`embodiments in the patent. The patents teach the use of the computer cursor
`as an advertisement and they rely on a set of software components to modify
`the standard cursor and replace it with a pre-determined specific image
`designed to advertise.
`So if you look at the right hand side at Demonstrative Number 6,
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`which is an excerpt, Figure 7 and 8 of the patent, you see when the cursor,
`there is a Fizzy Cola banner displayed and the cursor will change shape from
`the standard arrow depicted in element 44 to the bottle of Fizzy Cola in
`element 44A.
`Turning to Demonstrative Number 7, the patents concede that
`modification of the cursor isn’t new. And this is an excerpt on Exhibit 7
`where it states that the point is to put advertisements for the users focus at
`the cursor and change the supply cursor so that it corresponds to displayed
`content.
`But the alleged, the point of novelty that the patent itself alleges is not
`changing the cursor and modifying the cursor, it is modifying the cursor and
`I’ll read from the lower highlighted excerpt on Demonstrative Number 7.
`While it is not new for pointers and cursors to change shape, pointers
`are not presently used to convey advertising in conventional systems. The
`appearance of the cursor or pointers has not changed to correspond with
`online content being displayed on the screen. So that’s the novelty.
`Changing the cursor to reflect what the patent calls advertising material and
`to be reflective of the underlying display over which it is hovering.
`Now, Demonstrative Number 8 is simply for the Board's use and these
`demonstratives are obviously not evidence but we did include some
`checklists and things to aid the Board in reaching its final determination.
`Demonstrative Number 8 just lists the challenged claims and the
`combination of references that form the basis for the challenge.
`Demonstrative Number 9 is another score card meant to aid the Board.
`It has the challenged claims in the left most column, the prior art in the
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`center column and where we stand after the -- preliminarily after the
`institution decision.
`So the Y means that the Board has preliminarily found the patents are
`not, are unpatentable and the N means that the Board has preliminarily found
`the patents not unpatentable.
`And similarly, Demonstrative Number 10, this is a convention we are
`going to use as we go through each of the issues. The highlighted claims
`here have preliminarily been found to be not patentable.
`The claims that are not highlighted are preliminarily found to not be
`unpatentable but as we go through each issue we will then mark off the
`claims that would be affected and deemed unpatentable should the Board
`accept petitioners argument and today and in our reply.
`So one more preliminary issue. All of the combinations asserted
`against the challenged claims are based on four references. Malamud,
`Anthias, Nielsen and Baker and I am referring to Demonstrative Number 11.
`There has been -- there is no dispute over whether the showing,
`preliminary showing of motivation to combine is adequate. Petitioner made
`that showing in its petition. The Board preliminary deemed the showing of a
`motivation to combine to be adequate and I do not believe that patent owner
`has challenged that conclusion, preliminary conclusion that there is a
`motivation to combine.
`So now Demonstrative Number 12, let’s turn to the first issue to be
`addressed. I briefly explained it but it’s whether the petitioners
`demonstrated the Malamud plus Anthias limitation discloses limitations
`[c.][iv], 1 [c.][iv] and 1 [c.][iii].
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`Let’s turn to Demonstrative Number 13. Now I have given you plain
`language of sort of what the patent does and the concept but now let's tie that
`to this exemplary claim. The preamble states a server system from
`modifying a cursor image to a specific image. That specific image is the
`modified cursor.
`Looking at and I'm going to paraphrase the claims here so I'm not
`intending any claim construction argument, I just want to sort of lay the
`groundwork for the future argument.
`Limitation 1 A cursor image data correspond to said specific image.
`That is the data that specifies what the modified cursor should look like.
`Limitation 1 B, cursor display code says cursor display code operable to
`modify said cursor image. The cursor display code is what actually changes
`the cursor. It’s the code that changes the cursor.
`A first server computer for transmitting specified content information
`to said remote user terminal. This is a client server architecture. The patent
`originates in that architecture and the concept basically is the server upon
`request from the client will send a web page for example, like a vendor
`webpage, for example Amazon and along with that in the preferred
`embodiment it will send instructions on how to modify that cursor
`depending upon the cursors location on the underlying webpage.
`So all that is sent in one embodiment that’s preferred and I believe its
`column -- well, I -- yeah, column 4 of the 449 patent says that the preferred
`embodiments is that the server initially sends everything. The website, the
`underlying display information, how to modify the cursor, how and when to
`modify it.
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`I don’t think the claims are restricted to a single transmission of that
`information because it does describe that embodiment as a preferred
`embodiment. So that’s limitation 1 [c.].
`Limitations 1 [c.][i], the specified content information that is
`transferred from the server to the client includes many things. For example
`in limitation 1 [c.][i], it specified 1 [c.][ii] when a cursor displays
`instruction. That is sort of the instruction that works with the cursor display
`or a cursor display code to modify the cursor. And that indicates a location
`of the cursor image data, tells it where to find the data for the cursor.
`Limitation 1 [c.][iii] see the claims are somewhat repetitive a little bit.
`I don’t think they're, they're somewhat in artfully grafted. But responsive to
`a request from said user terminal for the specified content information and
`the specified content information further comprises information to be
`displayed on the display of the user’s terminal. That is again requesting the
`webpage.
`And in limitation [c.][iv] which is the one we are going to start with,
`the key part of limitation [c.][iv] that we are going to talk about is, I don’t
`know if we have a demonstrative that highlights it.
`I'm reading in response it’s what triggers the modification of the
`cursor. So it must be in response to movement of said cursor image over a
`display of said at least a part of said information to be displayed.
`So that’s the key issue here is what triggers the modification of the
`cursor and the patent it is the cursors positioning over part of the display
`where it has been instructed to modify the cursor when the cursor is in that
`position. And we believe that the panel misapprehended the argument that
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`petitioner was making there.
`Let’s go to the next demonstrative and then we will like I said we will
`circle back to limitation 1 [c.][iii]. So let’s go to -- let’s explain what the
`institute, what the misapprehension was and I first now I would like to go to
`the ELMO if I may. So I want to discuss right now a little bit about how
`Malamud operates. So I’m now showing, Judge Kaufman, Figure 4 of the
`Malamud patent on the ELMO.
`JUDGE KAUFMAN: Thank you.
`MR. VALENTINE: Oh, yes and it's, I'm now showing it sideways.
`Okay. So what Malamud is where is where I think some of the confusion
`may arise? Malamud is a single server embodiment and so we didn’t
`challenge the patent, the asserted patents with that.
`We combined it with Anthias which is a client server architecture that
`controls a display, it's a server control the display including modifying
`cursors. So we combined it.
`So but Malamud’s is a single cursor embodiment that says when you
`modify -- when the cursor is over a certain position of the screen, you can
`modify it. And there are four embodiments in Malamud.
`And one of these embodiments is called the combined name and
`preview cursor and under that embodiment when the cursor hovers over a
`given location, it may be instructed to provide a combined name and
`preview cursor which changes the cursor as depicted in Figure 4.
`You see the underlying display information book icon 32. The cursor
`changes to 36, elements 36 which is it previews it because it shows the book
`cover. It also names it because it has the text book cover and here it also
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`changes there is these flying chess pieces around. So that’s the embodiment
`of Malamud.
`And throughout the petition, we were -- when it’s a client server
`transformation in the Malamud system, that doesn’t exist. So we were
`arguing by analogy that those communications we were showing how they
`occur on the single computer embodiment but saying by analogy it would
`have been obvious to a person of skill in the art to extend those to the client
`server architecture.
`And we make that argument earlier in the petition as I'll show with
`respect to some of the transmissions. But one way to prove that that
`information exists on the client is to explain how it’s used on the client and
`that's how we did that. So I think our analogies may have led to the
`confusion.
`But now let’s turn to element [c.] [iv] on Demonstrative Number 17.
`And this is what -- and again, the --
`JUDGE FENICK: Can you tell her we need the slide up.
`MR. VALENTINE: Oh, can we go back to the presentation please.
`JUDGE FENICK: Thank you.
`MR. VALENTINE: So looking at Demonstrative 17. Oh no, this is --
`so 16. This is what the petition found with respect to element [c.][iv] and
`this says the petition does not explain for this limitation how a cursor image
`can be moved over a display of any portion of the name of the object
`displayed in the modified cursor.
`The Board preliminarily found that we were mapping the information
`to be displayed to the name of the cursor in the modified cursor. So a cursor
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`can't hover over its modified self and so with the misunderstanding that we
`were analogizing and it's the portion I didn’t read, argues that said
`information to be displayed on said display of said users terminal is the
`name of the objet to be displayed in the combined name a preview cursor.
`Given that misapprehension, the Board correctly found that [c.][iv]
`isn’t shown because a cursor can't hover over its modified self.
`JUDGE KAUFMAN: (inaudible)
`MR. VALENTINE: We take responsibility for that and I’ll show you
`what sentence led to the confusion. Yes, there was a question?
`JUDGE KAUFMAN: I'm curious. So the Board has a procedure for
`if there has been a misapprehension and that would be a request for a
`rehearing. You did not do a request for rehearing here.
`And particularly what concerns me about that is the lack of the ability
`for the patent owner to address that should we modify our institution
`decision in some way. Can you talk about why you didn’t do a request for a
`rehearing?
`MR. VALENTINE: Yes, Your Honor. We looked at that issue and
`were not sure of the correct procedure but we concluded that because the
`Board has instituted the decision that it would have been improper to ask the
`Board to reconsider that.
`However we did take corrective measures if I may find the
`demonstrative, immediately upon receiving the institution decision, actually
`I can’t say immediately, it was a couple weeks. But we did send a letter to
`the patent owner explaining this and I have this.
`JUDGE KAUFMAN: And I think you addressed that in the
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`petitioners reply at pages 25 and 26 if you have that.
`MR. VALENTINE: We did. So we did recognize -- its exhibit,
`Demonstrative 42. So what we did is we didn’t want to, I mean, according
`to our research this was sort of new ground so we didn’t feel like it was
`proper to ask for reconsideration of the institution in which is what we were
`requesting.
`But we did want to afford patent owner all the opportunities, a fair
`opportunity to respond to this so in exhibit, Demonstrative 42 we sent a
`letter and we said a trial petitioner intends to maintain and rely on its
`argument that the information to be displayed is disclosed by the object in
`Malamud and we are bringing this issue to your attention so that you may
`address it as you deem appropriate in discovery and in response briefs.
`Thereafter patent owner, this was before the close of discovery, before
`the time the notice depositions, before the patent owner response was due.
`And then in the sur reply we again explained this in our reply, excuse me.
`We explained this and then patent owner had an opportunity in the sur reply
`to address it.
`JUDGE KAUFMAN: I have a -- that leads me to a couple other
`questions. First of all, are you aware of any Board cases or Federal Circuit
`case that suggests that you could not have done a request for rehearing?
`What is your -- why did you think that?
`MR. VALENTINE: We did the research and, I mean, we consulted
`with people and have got colleagues. I can't recall the legal research that we
`did.
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`JUDGE KAUFMAN: Okay.
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`MR. VALENTINE: We saw the issue and I thought we took as a
`practical matter, we did seek steps to remedy it and so as not to prejudice
`patent owner. But I think the law that we found was inconclusive.
`JUDGE KAUFMAN: You do cite two Board cases for the
`proposition that an argument that hasn’t been made is waived but I think that
`both of those cases involved an argument that could have been made in
`patent owners response and which I think did not involve some kind of
`notification letter like you were doing. So for me, those cases are fairly easy
`to distinguish.
`Are you aware of any authority for a notification to the other party
`like you’ve done outside of the briefing in the proceedings?
`MR. VALENTINE: Not that I recall. There may have been one that
`led us to this, I just frankly can't remember the details of that decision.
`JUDGE KAUFMAN: Okay. And maybe for me maybe even more
`important than whether or not there has been a waiver by the patent owner --
`don’t you still have the burden of proof? So even if we think it was waived
`by the patent owner, you still have to have made a showing on that element?
`MR. VALENTINE: Yes. I agree. The burden remains on us
`regardless. Even if patent owner files nothing, we still have the burden to
`show everything. And I do, I was handed a note.
`In order to request rehearing us though that we had to object to non-
`institution based on some statutory language. So we did look at this issue
`vey carefully and I just, we chose the path we thought was the best.
`JUDGE KAUFMAN: Okay. I understand that. I am aware of Board
`cases where there have been requests for a rehearing by petitioners for things
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`other than changing institution. There’s some point of clarification they
`want to make. I think that the Board has done that in the past. But I think
`when I interrupted you, you were on Slide 16.
`MR. VALENTINE: Thank you. So that was limitations with the
`institution decision said with respect to limitation [c.][iv].
`So on Demonstrative Number 17, this is the argument the petitioner
`actually made in the portion of the petition dealing with limitation 1 [c.][iv]
`and it says when the preview cursor points to an object displayed on the
`screen, the cursor is modified so that indicates what triggers the modification
`is the position of the cursor on the screen.
`Similarly, we also similarly discussing on the next slide
`Demonstrative Number 18 we cite back to element 1 [c.][ii] in the petition
`and we did cite back to the petition on a number of instances.
`So Demonstrative Number 19 is the discussion we cited back to. It
`says when the preview cursor points to an icon for a book about chess that is
`displayed on the screen, the preview portion displays a graphic of chess
`pieces. Again, the trigger is positioned at the cursor over the underlying
`displayed information.
`On -- and there were other times in the petition we think the whole
`petition was consistent that this was our argument and this was our intended
`read and so the next five slides I'm just going to show you the examples in
`the petition where we argued the same thing.
`This is on Demonstrative Number 20, it’s in the overview of Malamud
`we cited to determining whether the cursor is pointing to an object and if so,
`displaying in the cursors information portion information. So that again
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`modified based on cursor over display.
`Slide 21. This is discussing the element one preamble. When it’s
`pointing portion points to an onscreen object, the information cursor is
`modified.
`Demonstrative 22. This is in element 1A in our Malamud plus
`Anthias discussion. Each time that an information cursors pointing portion
`points at an object, the bitmap and other information are retrieved to check if
`the cursor needs to be modified.
`Demonstrative Number 23. This is element 1B. Whether it checks
`whether the cursor is pointing to an object and if so, it passes a message to
`the operating system that tells the operating system what kind of cursor to
`display.
`And then finally on Demonstrative Number 24, this is for Claim 53
`which is the method analog to Claim 1. In the preamble we say when the
`information cursors pointing portion points at an onscreen object, the
`information cursor is modified.
`So I just cite those examples to just be up front that is it not a newly
`crafted argument. This is what we intended to make all along. So that’s
`soon that we -- that was the argument that we had made. Let’s take a look at
`the authority we cite in Malamud.
`Let’s go to Demonstrative Number 25. So here is the portion in
`Malamud. This is discussed at the petition at the page 37. But if you look at
`the highlights, it says that het message specifies the position of the cursor in
`the window as described above. The window procedure then determines
`what’s displayed within the window.
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`For instance, in an object which may be at a specified position and
`then skipping a few lines, if a name entity is present at the specified cursor
`position, the information regarding the object of the specified cursor position
`is displayed in the information cursor.
`So again, these are examples and one more on the next Demonstrative
`26, walking through Figure 7 of Malamud. What is at the specified cursor
`position? The procedure after that's determined the procedure passes a
`message to the operating system that tells the operating system what type of
`cursors to display.
`So this is, we do believe that our argument that Malamud discloses
`modifying the cursor in response to the cursors position over the displayed
`object is steeped in the disclosure of that reference.
`JUDGE FENICK: Can you stay here for one second?
`MR. VALENTINE: Sure.
`JUDGE FENICK: The first underlining in this page 26, talks about
`the message -- the procedure passes a message to the operating system that
`tells the operating system what type of cursor to display.
`Is that the message that you’re referring to in the petition with respect
`to the transmission of the specified content information being responsive to a
`request that -- responsive to that request this is the message?
`MR. VALENTINE: Are you on limitation 1 [c.][iii]
`JUDGE FENICK: 1 [c.][iii], yes. So in the petition on -- at pages 35
`and 36, there is a description of modifying an information cursor to display
`its information portion initiates, I'm sorry.
`There’s a quote that says when the cursor position is moved by the
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`mouse and then it goes on to say the operating system generates and sends a
`message to the program which forwards the message with new cursor
`position to the programs and window procedure.
`So this is the message that gets, that is sent responsive to the request
`for the specified content information.
`MR. VALENTINE: So this is the -- part of the confusion is that yes,
`it's either that or its analogues to it. So we're showing Malamud’s doesn’t
`have a server. So this would be analogous to that because the operating
`system ultimately controls the cursor so there is a message that tells the
`operating system what to do.
`In the single computer architecture, it -- all of that stuff exists on a
`single computer. But we argue and I think we will get to this, but we argue
`in other limitations that it would have been obvious to a person of skill in the
`art to combine that in those communications can come over a server to
`control it.
`JUDGE FENICK: But this message deals only with – the description
`here in Malamud talks about telling the operating system what type of cursor
`to display and sets forth the content sand type of information to be displayed
`in the cursor and it doesn’t talk about the underlying display that the cursor
`is moving over.
`MR. VALENTINE: So that is again information to be displayed is
`everything sent initially by the server but it were also include, we didn’t do a
`claim construction information to be displayed.
`I think information to be displayed is fairly read to mean anything on
`the computer including the modified cursor information as well. But over
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`the information to be displayed that triggers the cursor modification is the
`underlying website.
`For example, the -- I don’t know if I've responded to your question but
`that’s the request to modify the cursor in response to that the position of that
`cursor.
`JUDGE FENICK: Right. The claim doesn’t talk about a request to
`modify a cursor, it talks about transmission of specified content information
`responsive to a request from said user terminal for a said specified content
`information.
`And is, it sounds like this message is the, is what you pointed to for
`the transmission of said specified content information.
`MR. VALENTINE: I think we point to this message for -- I think that
`in limitation 1 [c.] the specified content information is the request, it's the
`same request that is alluded to in limitations 1 [c.][i], I think that’s the initial
`one.
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`We were showing here that specified content information -- and I
`think we were just demonstrating here why the cursor is modified and
`maybe that discussion goes better in limitation 1 [c.][iv].
`JUDGE FENI