Square, Inc.
`v.
`4361423 Canada Inc.
`IPR2019-01649
`IPR2019-01650
`
`January 28, 2021
`4361423 Canada Inc. Exhibit 2013
`Square, Inc. v. 4361423 Canada Inc.
`IPR2019-01649
`Page 1
`
`1
`
`
`v.
`4361423 Canada Inc.
`IPR2019-01649
`IPR2019-01650
`
`January 28, 2021
`4361423 Canada Inc. Exhibit 2013
`Square, Inc. v. 4361423 Canada Inc.
`IPR2019-01649
`Page 1
`
`1
`
`
`
`IPR2019-01649
`
`U.S. Patent No. 9,016,566
`
`• Ground 1:
`• Claims 1-4 - Proctor in view of Vrotsos under 35 U.S.C. §103(a)
`• Ground 2:
`• Claims 1-4 - Colnot in view of Vrotsos under 35 U.S.C. §103(a)
`• Ground 3:
`• Claims 1-4 - Eisner in view of Vrotsos and Proctor under 35 U.S.C. §103(a)
`• Ground 4:
`• Claims 1-4 - Proctor in view of Vrotsos and Morley under 35 U.S.C. §103(a)
`
`2
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Exhibit 2013 Page 2
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`
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`The ‘566 Patent
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`3
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649
`Ex. 1001
`
`IPR2019-01649 Exhibit 2013 Page 3
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`
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`IPR2019-01650
`
`U.S. Patent No. 9,311,637
`
`• Ground 1:
`• Claims 1-4 - Proctor in view of Vrotsos under 35 U.S.C. §103(a)
`• Ground 2:
`• Claims 1-4 - Colnot in view of Vrotsos under 35 U.S.C. §103(a)
`• Ground 3:
`• Claims 1-4 - Eisner in view of Vrotsos and Proctor under 35 U.S.C. §103(a)
`• Ground 4:
`• Claims 1-4 - Proctor in view of Vrotsos and Morley under 35 U.S.C. §103(a)
`
`4
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Exhibit 2013 Page 4
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`
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`The ‘637 Patent
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`5
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`IPR2019-01650
`Ex. 1001
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`IPR2019-01649 Exhibit 2013 Page 5
`
`
`
`‘566 Patent
`
`‘637 Patent
`(adds encryption)
`
`IPR2019-01649 Ex. 1001, p. 15
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`6
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01650 Ex. 1001, p.15
`IPR2019-01649 Exhibit 2013 Page 6
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`
`
`Ground 1
`
`Claims 1-4 - Proctor in view of Vrotsos under
`35 U.S.C. §103(a)
`
`7
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Exhibit 2013 Page 7
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`
`
`Ground 1: Proctor + Vrotsos (Claims 1-4)
`• “smart card” and “sensor” for “reading the record information stored
`on the integrated circuit”
`
`• Use of industry standard is appropriate. “Heavy presumption” that
`claim terms carry ordinary meaning. (POSR, pp. 3-4)
`
`• Petitioner’s Reply evidence? Supports industry meaning of smart
`card. (POSR, pp. 4-5). See, e.g., AT&T Smart Card (IPR2019-01649 Ex. 1027, p. 2) (referring to
`ISO Standard)
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`8
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Exhibit 2013 Page 8
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`
`
`Ground 1: Proctor + Vrotsos (Claims 1-4)
`“smart card” and “sensor” for “reading the record information stored on the
`integrated circuit”
`
`Zatkovich’s alleged admission? What Zatkovich really said:
`
`“[N]o smart cards, as far as I know, have what are referred to as a
`memory chip or contain a memory chip. They contain an EMV
`chip, also known as a smart chip or NFC chip. But as far as I know, no
`one has ever referred to a smart card as containing a memory chip.” …
`IPR2019-01649 Ex. 1021, 72:24-73:4 (cited, POSR, p. 5)
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`9
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Exhibit 2013 Page 9
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`
`
`Ground 1: Proctor + Vrotsos (Claims 1-4)
`“smart card” and “sensor” for “reading the record information stored on the
`integrated circuit”
`
`Proctor’s disclosure:
`A magnetic credit card reader Slot 46 is an input device that reads
`unique data encoded on a magnetic strip on a purchaser's credit
`card 48. In alternative embodiments, the credit card may include data
`encoded by other means, such as a memory chip that records
`information beyond identifying the card, including balance and
`available credit.
`IPR2019-01649 Ex. 1007, ¶10 (emphasis added) (POSR, p. 6)
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`10
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Exhibit 2013 Page 10
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`
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`Ground 1: Proctor + Vrotsos (Claims 1-4)
`Claimed “smart card” and “sensor” for “reading the record information stored on
`the integrated circuit”
`Vrotsos = discloses “read/write head” but never an IC sensor. (IPR2019-01649 POSR, p. 7)
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`11
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Ex. 1009, p. 5 (Fig. 2(a))
`(POR, p. 20)
`IPR2019-01649 Exhibit 2013 Page 11
`
`
`
`Ground 1: Proctor + Vrotsos (Claims 1-4)
`The “output jack”
`• Petitioner: “terminal end of cable 32 in gold, correspond[s] to the
`output jack.”
`• Shows jack coming from converter:
`
`12
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Petition, p. 31
`(shown at POR, p. 22)
`
`IPR2019-01649 Exhibit 2013 Page 12
`
`
`
`Ground 1: Proctor + Vrotsos (Claim 3)
`“further processing”
`
`Claim 3 requires: “providing said analog signal indicative of the
`recorded information stored on the integrated circuit to said mobile
`communication device for further processing by circuitry contained in
`said mobile communication device … .”
`
`Patent Owner: “As the ‘566 patent shows, the limitation of ‘further
`processing’ is not merely relaying a signal or reformatting the signal for
`transmission to the transaction server.” (IPR2019-01649 POR, p. 26)
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`13
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Exhibit 2013 Page 13
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`
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`Ground 1: Proctor + Vrotsos (Claim 3)
`“further processing”
`Petitioner: “Proctor’s phone would perform the same processing without
`regard to what the input is to the microphone circuit of the phone,
`whether it is vocal communications from a user speaking into the
`microphone … or audio tones bearing card data received from the
`converter 30 in Proctor. In this manner, the phone in Proctor includes
`circuitry that performs further processing on the analog signal received
`from the converter 30, by encoding it digitally and in a highly compressed
`format.”
`IPR2019-01649 Petition, pp. 38-39 (bold emphasis added) (quoted at POR, p. 24).
`
`“But this description does not constitute anything more than describing the
`relaying of information from the mobile phone’s audio jack to the cellular
`network. See Ex. 2005, ¶73. In none of the Proctor’s disclosure is the card
`information recovered from the audio signals in order to be processed.”
`(IPR2019-01649 POR, p. 24)
`
`14
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`IPR2019-01649 Exhibit 2013 Page 14
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`
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`Ground 1: Proctor + Vrotsos (Claim 3)
`“further processing”
`
`Vrotsos does not fill gap. PO Responded that cited portions of Vrotsos:
`“refer only to processing of input received from a user (e.g. PIN,
`fingerprint, signature). These do not identify the processing of
`information stored on the card.” (IPR2019-01649 POR, p.27);
`
`OR
`
`“merely describe the ‘packag[ing] of transaction data’ in order to
`send to the server. … This is not processing of the card
`information.” (IPR2019-01649 POR, p. 27)
`
`15
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Exhibit 2013 Page 15
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`
`
`Ground 1: Proctor + Vrotsos (Claim 3)
`“further processing”
`• Petitioner previously asserted, in reference to Morley claim language “further
`processing by circuitry contained in the cell phone”:
`
`“As such, in this embodiment, installation of a software application controller
`51 is necessary. This software application is used to convert between audio and
`digital signal and to receive and transmit and [sic] audio data to and from the
`hands-free interface … [citing Tang ‘637 patent at 10:49-53; Tang Provisional at
`Sections 300, 400, and 600.]” (POR, p. 25 (quoting Ex. 2001, pp. 52-53).
`
`• See 566 patent at 10:56-60 (discussing software application of controller 51).
`
`16
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Exhibit 2013 Page 16
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`
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`IPR2019-01650 Ground 1 (Proctor + Vrotsos)
`‘637 added encryption elements (Claims 1, 3)
`
`• Proctor discloses no encryption. (IPR2019-01650 POR, p. 21)
`• Vrotsos? “Although Vrotsos discloses encryption of card information as
`read by the magstripe reader 23 and the ‘input device,’ Vrotsos does not
`explicitly disclose a smart card reader in this context at all.” (IPR2019-01650 POR,
`p. 22)
`• Petitioner cites to Vrotsos ¶52, which provides: “The user may move the
`card past the reader assembly and transaction data may be captured by the
`reader 23 in the attachment 21. The attachment 21 may encrypt the
`transaction data captured by the reader 23.” (IPR2019-01650 Petition, 27; POR, 22)
`• But: “While Vrotsos may disclose encryption of magstripe information,
`there is nothing disclosed showing the capability to perform encryption of
`smart card information.” (IPR2019-01650 POR, p. 22)
`
`17
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Exhibit 2013 Page 17
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`
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`1649-1650 Ground 1: Proctor + Vrotsos
`No motivation to combine Proctor and Vrotsos
`In re Nuvasive, Inc., 842 F.3d 1376, 1381-82 (Fed. Cir. 2016) (“‘[T]he factual inquiry whether to
`combine references must be thorough and searching,’ and ‘[t]he need for specificity pervades [our]
`authority’ on the PTAB's findings on motivation to combine.”) (Emphasis added) (POR, 53)
`
`TQ Delta, LLC v. CISCO Sys., Inc., 942 F.3d 1352, 1359 (Fed. Cir. 2019) (“[A] conclusory assertion with
`no explanation is inadequate to support a finding that there would have been a motivation to
`combine because this type of finding, without more, tracks the ex post reasoning KSR warned of
`and fails to identify any actual reason why a skilled artisan would have combined the elements in
`the manner claimed.”) (POR, 55)
`
`Patent Owner: “In considering the question of motivation to combine and determining the
`obviousness issue, the asserted references must be considered for all that they teach, disclosures
`that that diverge and teach away from the invention at hand as well as disclosures that point toward
`and teach the invention at hand.” (POR, 53 (citing Ashland Oil, Inc. v. Delta Resins Refractories, Inc.,
`776 F.2d 281, 296 (Fed. Cir. 1985) (citation omitted).)
`
`18
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Exhibit 2013 Page 18
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`
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`1649-1650 Ground 1: Proctor + Vrotsos
`No motivation to combine Proctor and Vrotsos
`
`IPR2019-01649 Ex. 1007, p. 2 (Fig. 1)
`
`IPR2019-01649 Ex. 1009, p. 15 (Fig. 10)
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`19
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Exhibit 2013 Page 19
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`
`
`1649-1650 Ground 1: Proctor + Vrotsos
`No motivation to combine Proctor and Vrotsos
`
`20
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649
`Ex. 2005, ¶89, (POR, pp. 55-56)
`
`IPR2019-01649 Exhibit 2013 Page 20
`
`
`
`Ground 2
`
`Claims 1-4 - Colnot in view of Vrotsos under
`35 U.S.C. §103(a)
`
`21
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Exhibit 2013 Page 21
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`
`
`Ground 2: Colnot + Vrotsos (Claims 1-4)
`reading the “recorded information stored [on the] integrated circuit”
`
`Claim 1: “smart card reader device for reading a smart card having
`recorded information stored on an integrated circuit incorporated into
`the card …”
`
`Claim 3: “card reader device comprising a sensor for reading the
`recorded information stored on the integrated circuit”
`
`22
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Exhibit 2013 Page 22
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`
`
`Ground 2: Colnot + Vrotsos (Claims 1-4)
`reading the “recorded information stored on the integrated circuit”
`Colnot: discloses a key jack having an EEPROM with a sound file used for “sound pass”. IPR2019-
`01649 Ex. 1011, ¶55 (POR, p. 11)
`Petitioner: “[c]omponents of the smart card and circuitry for reading the smart card are on a
`portable key jack (i.e., audio plug), which plugs into ‘a microphone input on a PC or other computing
`appliance.” IPR2019-01649 Petition, p. 41.
`
`IPR2019-01649 Ex. 1011 (Fig. 5)
`(POR, p. 11)
`
`Patent Owner: “A POSITA would not expect the ‘smart card’ disclosed in the ‘566 patent to be a ‘key
`jack’ as Colnot discloses.” (POR, p. 30)
`
`23
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Exhibit 2013 Page 23
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`
`
`Ground 2: Colnot + Vrotsos (Claims 1-4)
`reading the “recorded information stored on the integrated circuit”
`• Petitioner’s annotated Fig. 6 from Colnot (IPR2019-01649 Petition, p. 43)
`
`• “Petitioner resorts to some sleight of hand … to fuse separate
`embodiments together to find both a smart card and a smart card reader …
`. [T]he single chip 407 is not a card, but Petitioner asserts it as a card and
`the remainder of the device as the card reader.” IPR2019-01649 POR, p. 30
`IPR2019-01649 Exhibit 2013 Page 24
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`24
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`
`
`Ground 2: Colnot + Vrotsos (Claims 1-4)
`reading the “recorded information stored on the integrated circuit”
`
`Colnot Fig. 6 without Petitioner’s modifications (IPR2019-01649 POR, p. 31):
`
`25
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Ex. 1011, p. 7 (Fig. 6)
`
`IPR2019-01649 Exhibit 2013 Page 25
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`
`
`Ground 2: Colnot + Vrotsos (Claims 1-4)
`reading the “recorded information stored on the integrated circuit”
`
`• “[I]n the unmodified embodiment of Fig. 6, 601 is the smart card and is
`removable from the card reader 602. Petitioner cannot rely on the
`authentic Fig. 6, because it would not meet the limitation of the claimed
`card reader, because the required components of the card reader (e.g.,
`circuitry, and components for producing analog signals) would be in the
`‘card.’” (IPR2019-01649 POR, p. 31)
`• “But Petitioner’s attempted end-around does not work, either. In
`petitioner’s modified embodiment, there is no card and no removable
`component to perform as a card. One of ordinary skill in the art would
`understand there must be a removable component in order to allow the
`user to use the smart card in various readers.” (IPR2019-01649 POR, p. 31)
`
`26
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Exhibit 2013 Page 26
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`
`
`Ground 2: Colnot + Vrotsos (Claims 1-4)
`“sensor” for reading the “recorded information stored on the integrated circuit”
`Petitioner: “In Colnot, the oscillator 405, processing unit 409, modem 406, and resistor
`403 (collectively, the sensor, in gold in Figure 6, below) …” (IPR2019-01649 Petition, pp. 48-49)
`
`“[B]ecause the chip (i.e. the purported “smart card”) is not removable, Petitioner’s
`embodiment allows no concept of having a “sensor” that detects the presence of an
`inserted “card” and then interfaces with the card once it is inserted.” (IPR2019-01649 POR, pp.
`33-34)
`
`27
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Exhibit 2013 Page 27
`
`
`
`Ground 2: Colnot + Vrotsos (Claims 1-4)
`“transmission to a transaction server for further processing”
`
`• Claim 1 requires “transmission to a transaction server for further
`processing.”
`
`• Claim 3 requires “transmitting said signal to a transaction server for
`further processing.”
`
`28
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Exhibit 2013 Page 28
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`
`
`Ground 2: Colnot + Vrotsos (Claims 1-4)
`“transmission to a transaction server for further processing”
`
`• Colnot based on traditional analog modem technology, and “a
`modem signal’s method for encoding and decoding information is not
`compatible with mobile networks.” (IPR2019-01649 POR, p. 35, citing Zatkovich)
`
`• Proctor ¶4: When communicating over cellular networks, “the
`compression responds to modem tones in a way that corrupts the
`data carried therein, and renders the result unusable.” (quoted at IPR2019-
`01649 POR, p. 35)
`
`29
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Exhibit 2013 Page 29
`
`
`
`Ground 2: Colnot + Vrotsos (Claims 1-4)
`“transmission to a transaction server for further processing”
`
`• Proctor’s “spoken word” language is irrelevant. “The issue is whether
`the modem signals of Colnot can be effectively transmitted.” (IPR2019-
`01649 POSR, p. 14)
`
`• “A POSITA would understand that Colnot’s mention of a modem in the
`cited contexts would refer to a traditional analog modem of the type
`discussed by Proctor, and would understand based on Proctor’s
`disclosure and the knowledge in the art that Colnot does not disclose
`a workable solution for transmitting an analog signal to a transaction
`server for further processing.” (IPR2019-01649 POR, p. 36)
`
`30
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Exhibit 2013 Page 30
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`
`
`IPR2019-01650 Ground 2 (Colnot + Vrotsos)
`‘637 added encryption elements (Claims 1, 3)
`
`• Vrotsos does not disclose encrypting smart card data as discussed
`previously.
`• “Colnot's resistor 403 does the converting and corresponds to the circuitry
`for converting said analog signal to an encrypted signal suitable for
`transmission to a jack of the mobile communication device.” (IPR2019-01650
`Petition, p. 46)
`• Also, “Petitioner asserts that the telephone referenced in Colnot transmits
`the encrypted signal to a transaction server, but the analog signal that is
`transmitted by the mobile phone is generated by a modem. And a POSITA
`would understand that the modem described is the traditional analog
`modem that generates a modem signal which cannot be transmitted on a
`digital cellular network. See Ex. 2007, ¶116.” (IPR2019-01650 POR, p. 35)
`
`31
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`IPR2019-01649 Exhibit 2013 Page 31
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`
`
`1649-1650 Ground 2: Colnot + Vrotsos
`No motivation to combine Colnot and Vrotsos
`• Petitioner’s explanation:
`• Vrotsos complements Colnot. Similar to Colnot, Vrotsos’s portable smart card reader device
`reads information stored on the integrated circuit incorporated into the card (Ex. 1009, ¶41),
`processes that information (id. ¶52), and transmits it to the phone over a physical
`connection, such as an RS-232 serial interface, but can generally be another “type[] of serial
`or parallel interface connector[]” (id. ¶43), such as Colnot’s tip/ring/sleeve plug (or audio
`jack). (Petition, p. 47)
`• Patent Owner:
`• “Vrotsos and Colnot are not complementary, and this explanation does not make any sense.
`First, Colnot’s ‘audio jack’ … is not actually present in Vrotsos. Second, the ‘tip/ring/sleeve’
`jack is not the type of digital serial or parallel connection that Vrotsos exclusively uses to
`connect to a mobile phone. (Ex. 2005, ¶121)
`• Moreover, Vrotsos provides a straightforward way to connect a card reader over a digital
`connection to a mobile phone. If Vrotsos offers at least the advantage of being able to
`consummate a financial transaction through a digital connection to mobile phone without
`the need to be connected a stationary POS device like a cash register, then that advantage
`disappears the instant that one adds a mandatory “sound pass” authentication step (Colnot)
`that is tethered to a personal computer.” (POR, p. 58)
`
`32
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`IPR2019-01649 Exhibit 2013 Page 32
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`
`
`1649-1650 Ground 2: Colnot + Vrotsos
`No motivation to combine Colnot and Vrotsos
`
`IPR2019-01649
`Ex. 2005, ¶120
`
`“Of all Petitioner’s prior art references, Colnot might conjure the least motivation to
`combine … . Colnot stands out from the invention, and from Vrotsos as well, in not
`relating at all to using a mobile phone for transmission of financial transactional
`information. Colnot effectively uses the mobile phone as little more than a security token,
`or a “jack key,” to generate a “sound pass” in order to help authenticate a transaction that
`is ultimately happening over a personal computer, not a mobile phone.” (POR, p. 57)
`
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`IPR2019-01649 Exhibit 2013 Page 33
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`
`
`1649-1650 Ground 2: Colnot + Vrotsos
`No motivation to combine Colnot and Vrotsos
`
`• Petitioner’s Proctor reference confirms there is no motivation to combine
`Colnot with Vrotsos.
`• “As Proctor explains, modem signals cannot be transmitted over a digital cellular
`network because ‘the compression [associated with vocoders] responds to modem
`tones in a way that corrupts the data carried therein, and renders the result
`unusable.’” POSR, p. 14 (quoting Proctor), ¶4)
`
`• “Petitioner’s only response to this is to cite Proctor’s disclosure that it is ‘effective for
`spoken words.’ … [But] [t]he issue is whether the modem signals of Colnot can be
`effectively transmitted. As shown by Proctor, Colnot does not disclose a workable
`solution for transmitting an analog signal to a transaction server for further
`processing. EX2005, ¶¶109-110. Proctor confirms there is no motivation to combine
`Colnot with Vrotsos. EX2005, ¶¶112-121.” (POSR, p. 14)
`
`34
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`IPR2019-01649 Exhibit 2013 Page 34
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`
`
`Ground 3
`
`Claims 1-4 - Eisner in view of Vrotsos and Proctor under
`35 U.S.C. §103(a)
`
`35
`
`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
`
`IPR2019-01649 Exhibit 2013 Page 35
`
`
`
`Ground 3: Eisner + Vrotsos + Eisner (Claims 1-4)
`Claimed “portable” device and “smart card” elements
`Eisner’s landline-based “PRCTT” system:
`
`36
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649
`Ex. 1012, p. 2, (POR, p. 37)
`
`IPR2019-01649 Exhibit 2013 Page 36
`
`
`
`Ground 3: Eisner + Vrotsos + Proctor (Claims 1-4)
`Claimed “portable” device and “smart card” elements
`Eisner: a non-portable, landline (RJ-11) based system (IPR2019-01649 POR, p. 37)
`Eisner’s only smart card mention:
`
`IPR2019-01649 Ex. 1012, p. 10
`(7:52-59), (POR, p. 38)
`
`• “Any actual explanation that Eisner provides is limited to a magnetic stripe reader.
`Id. ¶¶129-30; see generally Ex. 1012.” (IPR2019-01649 POR, p. 38)
`• Proctor “read/write head” does not fill gap (IPR2019-01649 POR, p. 39)
`
`37
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Exhibit 2013 Page 37
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`
`
`Ground 3: Eisner + Vrotsos + Proctor (Claims 1-4)
`
`• Claim 1: “said sensor including circuitry for converting said analog
`signal to a format suitable for transmission to a jack of a mobile
`communication device”
`
`• Claim 3: “wherein said portable card reader device produces an
`analog signal indicative of the recorded information stored on said
`integrated circuit … .”
`
`38
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Exhibit 2013 Page 38
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`
`
`Ground 3: Eisner + Vrotsos + Proctor (Claims 1-4)
`
`• “Eisner does not disclose producing a signal suitable for transmission
`to the jack of a mobile device.” (IPR2019-01649 POR, p. 41)
`• Eisner produces a signal for an RJ-11 jack. (IPR2019-01649 POR, p. 41)
`• Petitioner’s expert: “admits there would be a need ‘to modify Eisner’s
`system to include a component that converts the landline signal into a
`format for transmission over a digital cellular network.’ Ex. 1003, p.
`89.” IPR2019-01649 POR, p. 41 (quoting McNair)
`
`39
`
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`IPR2019-01649 Exhibit 2013 Page 39
`
`
`
`Ground 3: Eisner + Vrotsos + Proctor (Claims 1-4)
`• “While Eisner's phone network is a landline telephone network and Proctor's
`phone network is a cellular network, … it would have been obvious to implement
`Eisner's card reader device to include a connection to a jack on a mobile
`communication device, as taught by Proctor.” (IPR2019-01649 Petition).
`• But “Petitioner never establishes how Proctor’s modulated tonal signal would
`constitute a format suitable for transmission to a mobile phone jack. Moreover,
`Eisner’s output would not be compatible with Proctor’s phone 22. Proctor’s
`phone connector 26 would not accept an RJ-11 connector.” (IPR2019-01649 POR, p. 41)
`• “Petitioner itself has argued that a POSITA would not substitute an RJ-11
`connection for a hands-free jack connection without the reference explaining
`how the connection and signals would need be modified so the substitution
`would work. IPR2019-01630 Pet., pp. 21-22. Consistent with Petitioner’s own
`assertions, neither the plug nor the conductors of an RJ-11 connector would be
`compatible with a standard 3.5 mm hands-free audio jack present on mobile
`phones.” (IPR2019-01649 POR, p. 42)
`
`40
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
`
`IPR2019-01649 Exhibit 2013 Page 40
`
`
`
`Ground 3: Eisner + Vrotsos + Proctor (Claims 1-4)
`
`• Further, “Eisner does not disclose, and Petitioner does not explain,
`how a signal conditioned for a telephone line would necessarily be
`compatible with the input of Proctor’s phone 22.” IPR2019-01649 POR, p. 42
`
`• “A POSITA would also understand that Eisner’s DTMF signal could not
`be converted by Proctor’s converter 30 before the signal is passed
`along to the mobile phone. This is because Proctor’s converter 30 is
`disclosed to accept modem signals and then produce (not receive)
`DTMF signals.” IPR2019-01649 POR, p. 42
`
`41
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
`
`IPR2019-01649 Exhibit 2013 Page 41
`
`
`
`Ground 3: Eisner + Vrotsos + Proctor (Claims 1-4)
`• Also, no motivation for Eisner-Proctor
`
`• “The converter in Proctor accepts modem signals and converts them to a
`signal acceptable for transmission on a cellular network. A POSITA would
`understand that it was known that modem signals could not reliably send
`data over a cellular network due to corruption of the signal by vocoder
`compression, as Proctor itself discloses.” (IPR2019-01649 POR, p. 43)
`
`• “In other words, even if Eisner’s DTMF signals were somehow sent into the
`part of the Proctor converter intended to communicate with the mobile
`phone using audio signals, Proctor’s converter would only convert them to
`modem signals which are not transmissible on the cellular network.”
`
`42
`
`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
`
`IPR2019-01649 Exhibit 2013 Page 42
`
`
`
`Ground 3: Eisner + Vrotsos + Proctor (Claims 1-4)
`
`• “[E]ven if a portion of Proctor’s converter were incorporated into Eisner’s
`card reader, the only function described in Proctor is to convert the
`incoming modem signal to a DTMF signal. There is no teaching in Eisner
`involving the production of modem signals. Because Eisner’s card reader
`device only produces a DTMF signal, it would not be compatible with
`Proctor’s converter.” (IPR2019-01649 POR, pp. 43-44)
`
`• “[E]ven if a POSITA could understand that some portion of Proctor could
`take a DTMF signal and make it suitable for a hands-free jack, there is
`nothing supporting the conversion of an RJ-11 signal to a signal for a
`handsfree jack—which is a problem for the Petitioner’s asserted
`combination, because this is exactly what is produced by Eisner’s DTMF
`generator and Isolation transformer. (IPR2019-01649 POR, p. 44)
`
`43
`
`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
`
`IPR2019-01649 Exhibit 2013 Page 43
`
`
`
`Ground 3: Eisner + Vrotsos + Proctor (Claims 1-4)
`
`“[E]ven if one were to replace 38 (DTMF generator) with Proctor’s
`converter, the converter could not receive the digital signal coming
`from the encryptor 48 or the CPU 34. This is because Proctor’s
`converter 30 only accepts analog signals (specifically, modem signals)
`and then produces analog signals for the a mobile phone. Proctor
`discloses no portion of converter 30 that can accept digital signals. Id.
`¶161. But Eisner teaches a digital signal coming from these
`components into the combination of the D/A DTMF Generator 38 and
`isolation transformer 40.“ (IPR2019-01649 POR, p. 44)
`
`44
`
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`
`IPR2019-01649 Exhibit 2013 Page 44
`
`
`
`Ground 3: Eisner + Vrotsos + Proctor (Claims 1-4)
`• See IPR2019-01649 Ex. 1012, p. 9, 5:17-21 (quoted at POR, pp. 44-45):
`
`• “Thus, component 38 is receiving digital signals from the CPU/Encryptor, and producing analog
`DTMF signals. A POSITA would understand that this means that component 38 could not be
`replaced with the Proctor converter (or portions of the converter) because component 38 only
`accepts digital signals, and the Proctor converter does not disclose processing of digital signals
`(only conversion from one type of analog to another type of analog). Eisner’s transformer 40
`could not be replaced by the Proctor converter (or portions of the converter) since it could not
`accept DTMF signals from Eisner’s component 38 and then convert them to another type of DTMF
`signal for input to the cell phone.” (IPR2019-01649 POR, p. 45)
`
`45
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`
`IPR2019-01649 Exhibit 2013 Page 45
`
`
`
`Ground 3: Eisner + Vrotsos + Proctor (Claims 1-4)
`“smart card” and specified group of devices
`
`• Dependent claim 2: “in which the smart card is selected from a group
`consisting of a chip card, EMV card, proximity detector or NFC card,
`contactless card, or any combination thereof.”
`
`• Dependent claim 4: “in which the smart card is selected from a group
`consisting of a chip card, EMV card, proximity detector or NFC card,
`contactless card or any combination thereof
`
`46
`
`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
`
`IPR2019-01649 Exhibit 2013 Page 46
`
`
`
`Ground 3: Eisner + Vrotsos + Proctor (Claims 1-4)
`“smart card” and specified group of devices
`• Petitioner: “Eisner discloses the smart card is a chip card. Eisner states ‘IC
`cards, sometimes referred to as smart cards, which may contain the same
`information as the magnetic stripe, but in an integrated circuit, may also be
`used.’ Ex. 1012, 7:55-58. A credit card having an integrated circuit is a chip
`card.” (IPR2019-01649 Petition, p. 69)
`
`• Patent Owner: “This, together with the bare mention of a reader that
`would be “necessarily different” (and nothing more), does not disclose a
`smart card reader device. See Ex. 2005, ¶¶166-69. Eisner provides no
`information at all describing the differences or how the card reader would
`be different. Thus, no type of smartcard reader is disclosed, including a
`device mentioned in dependent claims 2 and 4.” (IPR2019-01649 POR, p. 46)
`
`47
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
`
`IPR2019-01649 Exhibit 2013 Page 47
`
`
`
`IPR2019-01650 Ground 3 (Eisner + Vrotsos + Proctor)
`‘637 added encryption elements (Claims 1, 3)
`
`• As discussed, Vrotsos and Proctor do not disclose encryption of smart card
`data.
`• Eisner’s “encryptor”? (IPR2019-01650 Petition, p. 60) Intended for magstripe
`information. Eisner as a magstripe reader does not disclose the ability to
`receive information from a smartcard IC chip which is already pre-
`encrypted. (IPR2019-01650 POR, p. 42)
`• “Eisner explicitly identifies that in order to read or process information
`from a smartcard IC chip, its ‘card reader would be necessarily different’
`without identifying any of those differences. … [A] POSITA would not find
`disclosure of the ‘637 patent’s ‘encrypted analog signal indicative of the
`recorded information stored on said integrated circuit’ through Eisner’s
`vague reference to an ‘encryptor’ alongside a vague reference to a smart
`card reader that ‘would be necessarily different.’ See Ex. 2007, ¶¶157-58.”
`(IPR2019-01650 POR, p. 42)
`
`48
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
`
`IPR2019-01649 Exhibit 2013 Page 48
`
`
`
`1649-1650 Ground 3: Eisner + Vrotsos + Proctor
`No motivation to combine Eisner with Proctor and Vrotsos
`
`49
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
`
`POR, p. 59
`
`IPR2019-01649 Exhibit 2013 Page 49
`
`
`
`Ground 4
`
`Claims 1-4 - Proctor in view of Vrotsos and Morley
`under 35 U.S.C. §103(a)
`
`50
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`
`IPR2019-01649 Exhibit 2013 Page 50
`
`
`
`Ground 4: Morley
`Morley is not prior art
`Reasons for adding Morley?
`• Ground 4 mostly based on Proctor and Vrotsos, so same arguments
`discussed previously apply.
`• Petitioner added Morley … to assert an output jack?
`IPR2019-01649 POSR, pp.1-2
`
`51
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`
`Ex. 1001, p. 15
`
`IPR2019-01649 Exhibit 2013 Page 51
`
`
`
`Ground 4: Morley
`Morley is not prior art
`Examiner already considered Morley
`
`“Patent Owner amended the ‘566 claims to address priority challenges
`over Morley. See Ex. 1004 at 33-36. The Examiner’s Notice of Allowance
`for the ‘566 patent specifically found that the applicant’s amendments
`and remarks overcame that prior art. See Id. at 22-23.” (IPR2019-01649 POR, p.
`47)
`
`52
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
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`IPR2019-01649 Exhibit 2013 Page 52
`
`
`
`Ground 4: Morley
`Morley is not prior art
`
`“The Examiner’s express consideration of Morley and resulting
`allowances are persuasive evidence that Morley is not prior art to
`claims of the ‘566 in view of the Tang Provisional.” (IPR2019-01649, POR, p. 47)
`IPR2019-01649 Exhibit 2013 Page 53
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`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
`
`53
`
`
`
`Ground 4: Morley
`Morley is not prior art
`Provisional Support
`• Alleged lack of Provisional support for “producing an analog signal
`indicative of the recorded information” and “converting said analog
`signal to an encrypted signal suitable for transmission to a jack of a
`mobile communication device.”
`
`• Alleged lack of Provisional support for “providing said analog signal
`indicative of the recorded information … to said mobile
`communication device for further processing by circuitry contained in
`said mobile communication device.”
`
`54
`
`DEMONSTRATIVE EXHIBIT - NOT EVIDENCE
`
`IPR2019-01649 Exhibit 2013 Page 54
`
`
`
`Ground 4: Morley
`Morley is not prior art
`Provisional Support
`• Board’s Institution Decision found that Tang Provisional adequately
`supported the claim elements challenged by Petitioner. (IPR2019-01649
`Institution Decision, pp. 15-20)
`• “And, with respect to the findings in the Institution Decision regarding
`support for the ‘566 patent claims in the Tang Provisional –i.e., its
`priority over Morley – Petitioner has not provided anything
`persuasive to change those conclusions. It has merely provided new
`and flawed arguments and testimony that should have been provided
`at the Petition stage.” (IPR2019-01649 POSR, p.19)
`• PO disputes new arguments on Reply (e.g., “two-step process” and
`“D/A” circuitry). (IPR2019-01649 POSR, pp. 22-24)
`
`55
`
`DEMONSTRATIVE EXHIB
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