Case 1:14-cv-01572-GMS Document 80 Filed 01/08/16 Page 1 of 23 PageID #: 1709
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF DELAWARE
`
`Civil Action No. 14-1571-GMS
`
`
`JURY TRIAL DEMANDED
`
`Civil Action No. 14-1572-GMS
`
`
`JURY TRIAL DEMANDED
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`Plaintiff,
`
`
`
`v.
`
`IOENGINE, LLC,
`
`
`
`
`
`INTERACTIVE MEDIA CORP. D/B/A
`KANGURU SOLUTIONS,
`
`
`
`
`
`Defendant.
`
`
`
`
`IOENGINE, LLC,
`
`
`Plaintiff and Counterclaim-
`Defendant,
`
`v.
`
`
`
`
`IMATION CORP.,
`
`
`Defendant and Counterclaim-
`Plaintiff.
`
`
`IMATION CORP.,
`
`Counterclaim-Plaintiff,
`
`v.
`
`IOENGINE, LLC, AND SCOTT F.
`McNULTY.,
`
`Counterclaim-Defendants.
`
`
`
`PLAINTIFF IOENGINE, LLC’s ANSWERING CLAIM CONSTRUCTION BRIEF
`
`
`
`PayPal Ex. 1024, p. 1
`PayPal v. IOENGINE
`
`

`

`Case 1:14-cv-01572-GMS Document 80 Filed 01/08/16 Page 2 of 23 PageID #: 1710
`
`SMITH, KATZENSTEIN & JENKINS, LLP
`
`Neal C. Belgam (No. 2721)
`Eve H. Ormerod (No. 5369)
`1000 West Street, Suite 1501
`Wilmington, Delaware 19801
`Telephone: (302) 504-1688
`nbelgam@skjlaw.com
`eormerod@skjlaw.com
`
`Attorneys for Plaintiff IOENGINE, LLC
`
`
`
`Of Counsel:
`
`Jeffrey Ostrow
`jostrow@stblaw.com
`SIMPSON THACHER & BARTLETT LLP
`2475 Hanover Street
`Palo Alto, California 94304
`Telephone: (650) 251-5000
`
`Noah M. Leibowitz
`nleibowitz@stblaw.com
`Gregory T. Chuebon
`gchuebon@stblaw.com
`SIMPSON THACHER & BARTLETT LLP
`425 Lexington Avenue
`New York, New York 10017
`Tel: (212) 455-2000
`
`Dated: January 8, 2016
`
`
`PayPal Ex. 1024, p. 2
`PayPal v. IOENGINE
`
`

`

`Case 1:14-cv-01572-GMS Document 80 Filed 01/08/16 Page 3 of 23 PageID #: 1711
`
`
`TABLE OF CONTENTS
`
`
`I.
`
`II.
`
`INTRODUCTION .............................................................................................................. 1
`
`IOENGINE’S PROPOSED TERMS FOR CONSTRUCTION ......................................... 2
`
`A.
`
`“Executable Program Code Stored Thereon”; “Program Code Stored on the
`Portable Device Memory”; “Containing Executable Program Code”; and
`“[First/Second] Program Code Stored on the Portable Device Memory” .............. 2
`
`1.
`
`2.
`
`3.
`
`The Program Code of the ’047 Patent “Can be Run” ................................. 2
`
`The Program Code of the ’047 Patent is Run “From the Portable
`Device Memory on Which it is Stored” ...................................................... 4
`
`The Program Code of the ’047 is “a Sequence of Instructions” ................. 7
`
`III.
`
`DEFENDANTS’ PROPOSED TERMS FOR CONSTRUCTION .................................... 9
`
`A.
`
`“First Program Code”; “Second Program Code”; and “Third
`[Program/Processing] Code” .................................................................................. 9
`
`1.
`
`2.
`
`3.
`
`The Details of the First, Second, and Third Program Codes are
`Clearly Laid Out in the Claims ................................................................. 10
`
`There Was No Disavowal in the Prosecution of the ’047 Patent .............. 10
`
`Defendants’ Constructions Improperly Preclude Any Involvement by
`the Terminal’s Processor in Enabling or Sending Communications ........ 12
`
`IV.
`
`IMC’s PROPOSED TERMS FOR CONSTRUCTION .................................................... 15
`
`A.
`
`B.
`
`C.
`
`D.
`
`“Portable Device” ................................................................................................. 15
`
`“Processor” ........................................................................................................... 16
`
`“Memory” ............................................................................................................. 17
`
`IMC’s Reference to 35 U.S.C. § 112, Paragraph 6 is Improper ........................... 18
`
`V.
`
`CONCLUSION ................................................................................................................. 19
`
`
`
`
`
`
`
`i
`
`PayPal Ex. 1024, p. 3
`PayPal v. IOENGINE
`
`

`

`Case 1:14-cv-01572-GMS Document 80 Filed 01/08/16 Page 4 of 23 PageID #: 1712
`
`
`TABLE OF AUTHORITIES
`
`CASES
`
`ACTV, Inc. v. Walt Disney Co.,
`346 F.3d 1082 (Fed. Cir. 2003)................................................................................................. 3
`
`Biotec Biologische Naturverpackungen GmbH & Co. KG v. Biocorp, Inc.,
`249 F.3d 1341 (Fed. Cir. 2001)............................................................................................... 18
`
`Cambrian Sci. Corp. v. Cox. Commc’ns, Inc.,
`617 Fed. Appx. 989 (Fed. Cir. 2015) ...................................................................................... 10
`
`Cloud Farm Assocs., L.P. v. Volkswagen Grp. of Am., Inc.,
`Civ. No. 10-502-LPS, 2015 WL 4730898 (D. Del. Aug. 10, 2015) ....................................... 18
`
`Computer Docking Station Corp. v. Dell, Inc.,
`519 F.3d 1366 (Fed. Cir. 2008)............................................................................................... 13
`
`Digital Biometrics, Inc. v. Identix, Inc.,
`149 F.3d 1335 (Fed. Cir. 1998)............................................................................................... 10
`
`Liebel–Flarsheim Co. v. Medrad, Inc.,
`358 F.3d 898 (Fed. Cir. 2004)................................................................................................... 5
`
`M2M Sols. LLC v. Sierra Wireless Am., Inc.,
`Civ. No. 12-30-RGA, 2015 WL 5826816 (D. Del. Oct. 2, 2015) .......................................... 18
`
`Oatey Co. v. IPS Corp.,
`514 F.3d 1271 (Fed. Cir. 2008)......................................................................................... 15, 16
`
`Phillips v. AWH Corp.,
`415 F.3d 1303 (Fed. Cir. 2005)..................................................................................... 5, 10, 17
`
`Schindler Elevator Corp. v. Otis Elevator Co.,
`593 F.3d 1275 (Fed. Cir. 2010)............................................................................................... 13
`
`Ventana Med. Sys., Inc. v. Biogenex Labs., Inc.,
`473 F.3d 1173 (Fed. Cir. 2006)................................................................................................. 5
`
`Vitronics Corp. v. Conceptronic, Inc.,
`90 F.3d 1576 (Fed. Cir. 1996)................................................................................................. 10
`
`Williamson v. Citrix Online, LLC,
`792 F.3d 1339 (Fed. Cir. 2015)............................................................................................... 18
`
`35 U.S.C. § 112 ............................................................................................................................. 18
`
`STATUTES
`
`ii
`
`PayPal Ex. 1024, p. 4
`PayPal v. IOENGINE
`
`

`

`Case 1:14-cv-01572-GMS Document 80 Filed 01/08/16 Page 5 of 23 PageID #: 1713
`
`
`I.
`
`INTRODUCTION
`
`Although the parties collectively propose 10 claim terms from U.S. Patent No. 8,539,047 (the
`
`“’047 patent”) for construction, there are three main claim construction disputes:
`
`First, Defendants assert that IOENGINE’s constructions of its proposed terms are incorrect
`
`because they would exclude “drivers.” Defendants are wrong because “drivers” are not part of the
`
`claimed “program code.” The specification and figures make clear that “drivers” are not
`
`embodiments of the invention and are separate, unclaimed preliminary software that do not perform
`
`the functions of “program code.”
`
`Second, Defendants argue that Mr. McNulty disclaimed all use of the terminal’s processing
`
`power. This misreads the prosecution history. IOENGINE does not dispute that the portable device
`
`processor must play some role in executing program code, as the claims themselves set out. But that
`
`does not mean that the terminal processor plays no role.
`
`Third, Defendants misread the claims as requiring the portable device processor to be
`
`enabled—without relying on the processing power of the terminal—to “receive” and “control”
`
`communications, and, in response to user interaction, to “cause”—again, without relying on the
`
`processing power of the terminal—communications to be sent across the network. However, the
`
`claims say nothing of “control,” and nothing in the claims or intrinsic record requires the portable
`
`device processor to “receive” or “control” communications, much less to do so entirely on its own.
`
`And while the claims do require that the portable device processor execute third program code—
`
`there is no dispute about this—that program code simply “causes a communication to be
`
`transmitted.” It does not require the portable device processor to, alone, manage the terminal’s
`
`network interface or the entire end-to-end communications session.
`
`1
`
`PayPal Ex. 1024, p. 5
`PayPal v. IOENGINE
`
`

`

`Case 1:14-cv-01572-GMS Document 80 Filed 01/08/16 Page 6 of 23 PageID #: 1714
`
`
`II.
`
`IOENGINE’S PROPOSED TERMS FOR CONSTRUCTION
`
`A.
`
`“Executable Program Code Stored Thereon”; “Program Code Stored on the
`Portable Device Memory”; “Containing Executable Program Code”; and
`“[First/Second] Program Code Stored on the Portable Device Memory”1
`
`1.
`
`The Program Code of the ’047 Patent “Can be Run”
`
`Defendants do not dispute that “can be run” is appropriate for the construction of the
`
`terms “executable program code stored thereon” and “containing executable program code,”
`
`each of which use the word “executable.” See Imation’s Opening Brief at 3 (conceding that
`
`“‘executable’ generally means ‘can be run’”). However, Defendants argue that “can be run” is
`
`not an appropriate part of the construction of the terms “program code stored on the portable
`
`device memory” and “[first/second] program code stored on the portable device memory,”
`
`because they do not contain the word “executable.” Defendants are mistaken.
`
`In every independent claim, the initial reference to “program code” is to “executable
`
`program code.”2 Subsequent references to “program code” in the independent claims (as well as
`
`all corresponding dependent claims) are part of this antecedent “executable program code.” For
`
`example, Claim 1 recites “(c) a memory having executable program code stored thereon,
`
`including ….” See ’047 Patent at Claim 1 (JA026-027).3 Element (c) is then subdivided into
`
`“first,” “second,” and “third” program code in (c)(1), (c)(2), and (c)(3), respectively—each of
`
`
`1
`The terms proposed for construction by IOENGINE appear in the following claims of the
`’047 Patent: “Executable Program Code Stored Thereon,” Claims 1, 24-27, and 30-31; “Program
`Code Stored on the Portable Device Memory,” Claims 1, 24-27, and 30-31; “Containing
`Executable Program Code,” Claim 27;” “First Program Code Stored on the Portable Device
`Memory,” Claims 24-26 and 30-31; and “Second Program Code Stored on the Portable Device
`Memory,” Claims 24, 26, and 30.
`2
`See, e.g., ’047 Patent at Claims 1, 24, 26-27, and 30 (JA026-028). Emphasis added and
`internal citations omitted throughout, unless otherwise specified.
`3
`Citations to “JA__” refer to pages of the Joint Appendix of Intrinsic Evidence. Citations
`to “Ex. __” refer to the Exhibits in Support of Plaintiff’s Answering Claim Construction Brief
`filed herewith.
`
`2
`
`PayPal Ex. 1024, p. 6
`PayPal v. IOENGINE
`
`

`

`Case 1:14-cv-01572-GMS Document 80 Filed 01/08/16 Page 7 of 23 PageID #: 1715
`
`
`which is a part of the antecedent “executable program code.”4 Id. (JA027). Elements (c)(1)-(3)
`
`go on to recite the functionality of the first, second and third program code “when executed.” Id.
`
`And in the first “wherein” clause, Claim 1 recites that “the portable device is configured to effect
`
`the display on the first output component of processing activity of program code stored on the
`
`portable device memory.” Id. The claim language thus makes clear in each instance that the
`
`claimed program code can be executed or processed, i.e., that it “can be run.” The other
`
`independent claims uniformly use this same structure and language: Claim 24 recites
`
`“executing” the first/second “program code stored on the portable device memory”; Claims 26
`
`and 27 use the “when executed” language of Claim 1; and Claim 30 recites that the portable
`
`device is configured to “execute” the first program code, and uses “when executed” for the
`
`second program code. See ’047 Patent at Claims 1, 24, 26-27, and 30 (JA026-028).
`
`Accordingly, even where the claims do not repeat the word “executable” immediately
`
`before “program code,” it is clear from the claim language that every instance of program code
`
`“can be run.” See ACTV, Inc. v. Walt Disney Co., 346 F.3d 1082, 1088 (Fed. Cir. 2003) (“[T]he
`
`context of the surrounding words of the claim also must be considered in determining the
`
`ordinary and customary meaning of [disputed claim terms].”).5 Defendants do not seriously
`
`
`4
`The antecedent relationship is perhaps even more traditionally evident in independent
`Claim 27, which recites “executable program code … the program code comprising: (a) first
`program code … (b) second program code … (c) third program code ….” See ’047 Patent at
`Claim 27 (JA028).
`5
`The specification also makes clear that “program code” is executable. See, e.g., ’047
`Patent at 14:3-6 (JA018) (“The CPU interacts with memory through signal passing through
`conductive conduits to execute stored program code according to conventional data processing
`techniques.”), id. at 26:8-9 (JA024) (“A user interface module 1017 is stored program code that
`is executed by the CPU.”), id. at 27:29-32 (JA025) (“A cryptographic server module 1020 is
`stored program code that is executed by the CPU 1003, cryptographic processor 1026,
`cryptographic processor interface 1027, and/or the like.”), id. at 28:17-18 (JA025) (“A TCAP
`module 1035 is stored program code that is executed by the CPU.”), id. at 28:46-47 (JA025)
`(“An access terminal module 1021 is stored program code that is executed by a CPU.”).
`
`3
`
`PayPal Ex. 1024, p. 7
`PayPal v. IOENGINE
`
`

`

`Case 1:14-cv-01572-GMS Document 80 Filed 01/08/16 Page 8 of 23 PageID #: 1716
`
`
`dispute that the claimed program code, in each instance, “can be run,” and so it forms an
`
`appropriate part of the construction of each of IOENGINE’s proposed terms.
`
`2.
`
`The Program Code of the ’047 Patent is Run “From the Portable Device
`Memory on Which it is Stored”
`
`Defendants disagree with IOENGINE’s proposed constructions on the basis that they
`
`would supposedly exclude the “driver” software discussed in the specification. But Defendants’
`
`argument presupposes that a “driver” is an embodiment of one of the claimed first, second, or
`
`third “program code.” This is wrong.
`
`Contrary to Defendants’ mischaracterization, a “driver” is not a preferred embodiment—
`
`or an embodiment at all—of the claimed “program code.” Instead, the drivers discussed in the
`
`specification precede the claimed “program code,” and merely ensure that the terminal can
`
`access the memory of the portable device. As shown in Figure 3 of the ’047 Patent (JA004) and
`
`the accompanying text in the specification (see ’047 Patent at 6:19-57 (JA014)), loading the
`
`“TCAP driver” (see Fig. 3 at 335) is an optional, preliminary step that that is only needed if the
`
`terminal is not otherwise capable of accessing the portable device’s memory (see Fig. 3 at 330).
`
`If the terminal is capable of accessing the portable device’s memory, or if a driver was
`
`previously loaded (see Fig. 3 at 335), then the terminal “executes instructions from TCAP
`
`memory,” i.e., runs program code from the portable device memory (see Fig. 3 at 398).6
`
`
`
`
`6
`The description of a “driver” as software executed by the terminal which enables it to
`access the portable device memory is likewise supported by the extrinsic evidence. See, e.g., Ex.
`A (Microsoft Computer Dictionary (5th ed. 2002)) at 155 (defining a “device driver” as “[a]
`software component that permits a computer system to communicate with a device”); id. at 177
`(describing a “driver” as “[a] hardware device or a program that regulates another device …. [a]
`software driver is a device-specific control program that enables a computer to work with a
`particular device, such as a printer or a disk drive.”).
`
`4
`
`PayPal Ex. 1024, p. 8
`PayPal v. IOENGINE
`
`

`

`Case 1:14-cv-01572-GMS Document 80 Filed 01/08/16 Page 9 of 23 PageID #: 1717
`
`
`
`
`’047 Patent at Fig. 3 (JA004) (annotations added).
`
`The mere fact that the specification discusses a “driver” does not mean that the claims
`
`necessarily must be broad enough to include it. See Ventana Med. Sys., Inc. v. Biogenex Labs.,
`
`Inc., 473 F.3d 1173, 1181 (Fed. Cir. 2006) (“When the claim addresses only some features
`
`disclosed in the specification, it is improper to limit the claim to other, unclaimed features.”);
`
`Phillips v. AWH Corp., 415 F.3d 1303, 1327 (Fed. Cir. 2005) (“[T]he fact that a patent asserts
`
`that an invention achieves several objectives does not require that each of the claims be
`
`construed as limited to structures that are capable of achieving all of the objectives.”) (quoting
`
`Liebel–Flarsheim Co. v. Medrad, Inc., 358 F.3d 898, 908 (Fed. Cir. 2004))).
`
`5
`
`PayPal Ex. 1024, p. 9
`PayPal v. IOENGINE
`
`

`

`Case 1:14-cv-01572-GMS Document 80 Filed 01/08/16 Page 10 of 23 PageID #: 1718
`
`
`Indeed, as described by the specification, “drivers” may be downloaded from the Internet
`
`or loaded from a CD.7 Thus, drivers cannot possibly be “program code” as they need not be
`
`“stored” on the memory of the claimed portable device—which all parties agree is a necessary,
`
`claimed feature of “program code.” See Imation’s Opening Brief at 5 (“In the context of the
`
`asserted claims, the term ‘stored’ tells the reader where the program code is located (e.g., it is
`
`located on the portable device memory).”). Certainly a “driver,” which may be loaded to the
`
`terminal from the Internet or a CD is not an embodiment of claimed “program code,” and
`
`therefore, Defendants’ argument that IOENGINE’s constructions would exclude “drivers” is a
`
`red herring.
`
`IOENGINE’s proposed constructions clarify for a lay reader that the “program code” is
`
`“stored” on the portable device memory “when executed.” For example, as discussed above, the
`
`“first,” “second,” and “third” program code in Claim 1, Elements (c)(1), (c)(2), and (c)(3), are
`
`each part of the “executable program code stored thereon,” i.e., stored on the portable device
`
`memory, recited at the outset of Element (c). See ’047 Patent at Claim 1 (JA027). Elements
`
`(c)(1)-(3) go on to recite the functionality of the first, second, and third program code “when
`
`executed.” See id. Therefore, the first, second, and third “program code” in elements (c)(1)-(3)
`
`is program code that is stored on the portable device memory “when executed”—put more
`
`simply, it is run from the portable device memory on which it is stored. See id. The other
`
`independent claims are in accord that the claimed program code is executed, or run from, the
`
`portable device memory. See, e.g., id. at Claim 24 (JA027) (“executing [first/second] program
`
`code stored on the portable device memory….”); id. at Claim 26 (JA027) (“providing the
`
`
`7 This distinction is also clear from arguments made during prosecution, where the James
`reference was distinguished as being similar to “floppy disks and CD-ROMS.” See Response to
`Office Action dated 6/14/12 at 12 (JA076).
`
`6
`
`PayPal Ex. 1024, p. 10
`PayPal v. IOENGINE
`
`

`

`Case 1:14-cv-01572-GMS Document 80 Filed 01/08/16 Page 11 of 23 PageID #: 1719
`
`
`terminal with access to [first/second] program code stored on the portable device memory which,
`
`when executed….”); id. at Claim 30 (JA028) (“execute [first/third] program code stored on the
`
`portable device memory….” and “provide the terminal with access to second program code
`
`stored on the portable device memory which, when executed….”).
`
`The specification reflects this as well. See, e.g., ’047 Patent at 6:5-6 (JA014) (“After
`
`engaging with the AT, the TCAP can provide its memory space to the AT 320.”); id. at 6:49-50
`
`(JA014) (Once the AT has accessed the TCAP’s memory, “the AT can execute program
`
`instructions from the TCAP’s memory ….”); see also id. at 5:20-24 (JA014) (“When the user
`
`issues a terminate signal 235, then the TCAP will shut down by saving any data to the TCAP that
`
`is in the AT’s memory and then terminating any programs executing on both the AT and TCAP
`
`that were executed by and/or from the TCAP 240.”); IOENGINE’s Opening Brief at 5-7.
`
`3.
`
`The Program Code of the ’047 is “a Sequence of Instructions”
`
`Defendants’ opposition to the phrase “a sequence of instructions” in IOENGINE’s
`
`proposed constructions comes primarily from the September 12, 2011 amendment in which
`
`“plurality of processing instructions” was replaced by “program code” in the claims. This
`
`argument is misplaced. IOENGINE’s construction is not “a plurality of processing instructions,”
`
`or any other phrase that was modified as part of the September 12, 2011 amendment. Indeed, the
`
`only similarity between the pre-amendment language and IOENGINE’s proposed constructions
`
`is the word “instructions.” IOENGINE’s proposed constructions do not attempt to claim all
`
`“processing instructions.” To the contrary, IOENGINE’s proposed constructions, read
`
`holistically, explain precisely the “sequence of instructions” that correctly describe “program
`
`code”—specifically, “a sequence of instructions that can be run from the portable device
`
`memory on which it is stored.”
`
`7
`
`PayPal Ex. 1024, p. 11
`PayPal v. IOENGINE
`
`

`

`Case 1:14-cv-01572-GMS Document 80 Filed 01/08/16 Page 12 of 23 PageID #: 1720
`
`
`Indeed, the ’047 Patent uses “programming” and “processing” interchangeably in the
`
`claims, referring both to the “processing activity of program code” (see ’047 Patent at Claims 1,
`
`24, 26, and 29 (JA026-028)), and to the execution of “third processing code” (see id. at Claim 24
`
`(JA027)). And the specification itself also frequently refers to the program code as both
`
`“processing instructions” and “program instructions.” See, e.g., id. at 2:61 (JA012) (“processing
`
`the processing instructions”); id. at 2:65-66 (JA012) (“a plurality of processing instructions
`
`stored in the memory”); id. at 6:49-50 (JA014) (“the AT can execute program instructions from
`
`the TCAP’s memory”); id. at 9:28-29 (JA016) (“the TCAP executes program instructions”).
`
`Defendants do not argue that the modification of some, but not all, instances of “processing
`
`instructions” to “program code” was done in order to overcome any rejection based upon the
`
`word “instructions.” In fact, Defendants do not dispute that program code is a sequence of
`
`instructions, and do not explain the import of any supposed distinction between the terms. As
`
`such, there is no “clear and unmistakable” disclaimer of the word “instructions” which would
`
`prevent its use in the larger phrase “a sequence of instructions that can be run from the portable
`
`device memory on which it is stored.”
`
`Although Defendants claim that “program code” is easily understood (see Imation’s
`
`Opening Brief at 5), Defendants offer no alternative explanation of what it means. In fact, the
`
`Defendants’ proposed constructions for “first program code,” “second program code,” and “third
`
`program [processing] code”8 themselves use the term “program code”9 while making no attempt
`
`to define it.
`
`8
`To the extent Defendants argue that IOENGINE’s constructions of its proposed terms are
`improper because different terms must have different meanings, Defendants themselves concede
`that this is not necessarily the case—Defendants ask the Court to construe “third program code”
`and “third processing code” identically.
`9
`Defendants’ proposals merely replace the words “first,” “second,” and “third” with
`dozens of additional words that improperly import limitations into the claims.
`
`8
`
`PayPal Ex. 1024, p. 12
`PayPal v. IOENGINE
`
`

`

`Case 1:14-cv-01572-GMS Document 80 Filed 01/08/16 Page 13 of 23 PageID #: 1721
`
`
`III. DEFENDANTS’ PROPOSED TERMS FOR CONSTRUCTION
`
`A.
`
`“First Program Code”; “Second Program Code”; and “Third
`[Program/Processing] Code”10
`
`The dispute between the parties regarding the Defendants’ proposed constructions of
`
`first, second, and third program code largely revolves around one issue: whether the portable
`
`device’s on-board processor must, by its processing activity alone, enable the portable device
`
`processor to receive communications from a user interface, to “control” communications sent
`
`through the terminal’s network interface, and to transmit communications over a network. The
`
`claims are not so limited.
`
`Defendants concede that their proposed constructions are designed to import limitations
`
`into the claims. See Imation’s Opening Brief at 10 (“Imation’s proposals largely track the
`
`language of the code elements – with one addition … ‘without relying on the processing power
`
`of the host computer.’”). As explained in detail in IOENGINE’s Opening Brief, Defendants fail
`
`to “largely track” the existing claim elements. See IOENGINE Opening Brief at 13-16.
`
`Moreover, Defendants’ “one addition” entirely changes the character of the claims, shifting
`
`responsibility away from the “portable device” as a whole (see, e.g., ’047 Patent at Claim 1,
`
`Element (c)(2) (JA028) (claiming “second program code which … enables the portable
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`device….”), and placing the burden solely on the “portable device processor.” See, e.g.,
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`Imation’s Opening Brief at 9-10 (seeking a construction of “second program code” that “enables
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`the portable device processor ….”). This, of course, is impermissible.
`
`
`10
`The terms proposed for construction by the Defendants appear in the following claims of
`the ’047 Patent: “First Program Code,” Claims 1, 21-22, and 24-31; “Second Program Code,”
`Claims 1, 24, 26-27, and 30; “Third Program Code,” Claims 1, 26-27, and 30; and “Third
`Processing Code,” Claim 24.
`
`9
`
`PayPal Ex. 1024, p. 13
`PayPal v. IOENGINE
`
`

`

`Case 1:14-cv-01572-GMS Document 80 Filed 01/08/16 Page 14 of 23 PageID #: 1722
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`1.
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`The Details of the First, Second, and Third Program Codes are Clearly
`Laid Out in the Claims
`
`Defendants argue that “the specification provides little guidance regarding the first,
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`second, and third program codes.” Imation’s Opening Brief at 10. This is incorrect.11 It also
`
`ignores that the claims themselves, not the specification, are the primary source of the meaning
`
`of the claim terms. See, e.g., Cambrian Sci. Corp. v. Cox. Commc’ns, Inc., 617 Fed. Appx. 989,
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`992 (Fed. Cir. 2015) (“[T]he actual words of the claim are the controlling focus.” (quoting
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`Digital Biometrics, Inc. v. Identix, Inc., 149 F.3d 1335, 1344 (Fed. Cir. 1998))); Phillips, 415
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`F.3d at 1314 (“[T]he claims themselves provide substantial guidance as to the meaning of
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`particular claim terms.” (citing Vitronics Corp. v. Conceptronic, Inc., 90 F.3d 1576, 1582 (Fed.
`
`Cir. 1996))).
`
`The claims of the ’047 Patent recite in detail what each of the first, second, and third
`
`program codes accomplish—no additional construction is required. Moreover, in the description
`
`of each of the first, second, and third program codes, there is no requirement that any of them be
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`run “without relying on the processing power of the host computer.”12
`
`2.
`
`There Was No Disavowal in the Prosecution of the ’047 Patent
`
`Defendants’ added limitation—that certain program code be run “without relying on the
`
`processing power of the host computer”—is predicated upon the supposed existence of a
`
`
`11
`The words “first,” “second” and “third” are simply numbers used in the claims to
`differentiate between program code that has different functions. In addition to the descriptions in
`the claim language itself, each program code is described in detail in the specification regardless
`of whether or not it is numbered. See, e.g., ’047 Patent at 2:55-61 (JA012), 9:20-49 (JA016),
`17:52-18:3 (JA020), 28:46-59 (JA025), and Fig. 3 (JA004) (describing “first program code”); id.
`at 2:55-61 (JA012) and 28:46-59 (JA025) (describing “second program code”); id. at 12:66-13:6
`(JA017-018), and 28:46-59 (JA025), (describing “third program code”).
`12
`Imation’s Opening Brief (filed on behalf of both Imation and IMC) concedes that at least
`the first and second program code may be executed by the terminal processor. See Imation’s
`Opening Brief at 15.
`
`10
`
`PayPal Ex. 1024, p. 14
`PayPal v. IOENGINE
`
`

`

`Case 1:14-cv-01572-GMS Document 80 Filed 01/08/16 Page 15 of 23 PageID #: 1723
`
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`“disavowal” during prosecution. But, as discussed in detail in IOENGINE’s Opening Brief, no
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`such disavowal took place in the June 14, 2012 Response to Office Action. See IOENGINE’s
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`Opening Brief at 12-13. In the remarks accompanying that Response, Mr. McNulty made clear
`
`that what differentiated the claimed invention from James was that, unlike his own invention,
`
`“James repeatedly discloses, teaches and suggests that all of the ‘processing power’ is provided
`
`by the host computer processor and that the applications software stored on the portable memory
`
`device is exclusively executed by the host computer processor.” See Response to Office Action
`
`dated 6/14/12 at 10 (JA074). By contrast, in the ’047 Patent the terminal processor is not the
`
`exclusive source of processing power. Instead, at least some of the processing power comes
`
`from the portable device’s on-board processor. Thus, contrary to Defendants’ suggestion that the
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`applicant disavowed all reliance on the terminal processor, the arguments distinguishing James
`
`mean only that at least some program code is executed by the portable device processor.
`
`In Imation’s Opening Brief, Defendants also rely on the January 25, 2013 Response to
`
`Office Action to find the alleged disavowal—but again they fail: In October of 2012, the
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`Examiner, acknowledging that James alone does not support a rejection of the claims, issued a
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`rejection based upon the combination of James and King. See Office Action dated 10/25/12 at 2
`
`(JA082). Where James lacked an on-board processor, the Examiner argued, King included one.
`
`The January 2013 Response overcame this rejection by making several arguments, none of
`
`which were that the portable device’s on-board processor must exclusively execute program
`
`code. Instead, Mr. McNulty reasoned that there would be no reason to place an on-board
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`processor (as disclosed in King) onto the device in James, because all of the required processing
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`power in James was provided by the terminal processor. Thus, “[i]ncluding an on-board
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`processor [in James] would be contrary to this fundamental aspect of James.” See Response to
`
`11
`
`PayPal Ex. 1024, p. 15
`PayPal v. IOENGINE
`
`

`

`Case 1:14-cv-01572-GMS Document 80 Filed 01/08/16 Page 16 of 23 PageID #: 1724
`
`
`Office Action dated 1/25/13 at 9 (JA112). The combination of King (which merely disclosed a
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`portable device having an on-board processor) and James (in which all of the processing power
`
`was provided by the terminal), therefore, could not yield the invention claimed in the ’047
`
`Patent, which requires that the portable device processor be involved in some way in executing
`
`the claimed program code—not that the terminal have no involvement. Id. at 13 (JA116)
`
`(“[E]ven if James were reconfigured to include an on-board processor, James does not disclose,
`
`teach or suggest any functions, operations or processing activity to be performed by such an on-
`
`board processor.”).
`
`Thus, in the January 2013 Response to Office Action, Mr. McNulty never asserted that
`
`what distinguished the claims of the ’047 Patent from James, or from the combination of James
`
`and King, was that they failed to disclose a system, method, or apparatus where all processing
`
`activity took place on the portable device. Mr. McNulty’s argument was, in part, that the art
`
`failed to disclose a system, method, or apparatus where any processing activity took place on the
`
`portable device. This crucial distinction is ignored by Defendants, and belies their “disavowal”
`
`argument.
`
`3.
`
`Defendants’ Constructions Improperly Preclude Any Involvement by the
`Terminal’s Processor in En