Trials@uspto.gov
`571-272-7822
`
`Paper 48
`Entered: November 10, 2021
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`BAYERISCHE MOTOREN WERKE AKTIENGESELLSCHAFT &
`BMW OF NORTH AMERICA, LLC,
`Petitioner,
`v.
`
`PAICE LLC & THE ABELL FOUNDATION, INC.,
`Patent Owner.
`
`IPR2020-00994
`Patent 7,104,347 B2
`
`
`
`
`
`
`
`
`
`Before SALLY C. MEDLEY, KALYAN K. DESHPANDE, and
`ARTHUR M. PESLAK, Administrative Patent Judges.
`PESLAK, Administrative Patent Judge.
`JUDGMENT
`Final Written Decision
`Determining All Challenged Claims Unpatentable
`35 U.S.C. § 318(a); 37 C.F.R. § 42.71
`Denying-in-Part and Dismissing-in-Part Petitioner’s Motion to Exclude
`37 C.F.R. § 42.64
`
`
`
`
`
`
`
`
`571-272-7822
`
`Paper 48
`Entered: November 10, 2021
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`BAYERISCHE MOTOREN WERKE AKTIENGESELLSCHAFT &
`BMW OF NORTH AMERICA, LLC,
`Petitioner,
`v.
`
`PAICE LLC & THE ABELL FOUNDATION, INC.,
`Patent Owner.
`
`IPR2020-00994
`Patent 7,104,347 B2
`
`
`
`
`
`
`
`
`
`Before SALLY C. MEDLEY, KALYAN K. DESHPANDE, and
`ARTHUR M. PESLAK, Administrative Patent Judges.
`PESLAK, Administrative Patent Judge.
`JUDGMENT
`Final Written Decision
`Determining All Challenged Claims Unpatentable
`35 U.S.C. § 318(a); 37 C.F.R. § 42.71
`Denying-in-Part and Dismissing-in-Part Petitioner’s Motion to Exclude
`37 C.F.R. § 42.64
`
`
`
`
`
`
`
`
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`IPR2020-00994
`Patent 7,104,347 B2
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`INTRODUCTION
`I.
`Bayerische Motoren Werke Aktiengesellschaft and BMW of North
`America, LLC (collectively “Petitioner” or “BMW”) filed a Petition
`(Paper 1) and, with our permission, filed a Corrected Petition (Paper 11,
`“Pet.”) requesting an inter partes review of claims 2, 11, 17, 24, 33, and 38
`of U.S. Patent 7,104,347 B2 (Ex. 1001, “the ’347 patent”). Petitioner
`submitted the Declaration of Dr. Gregory W. Davis in support of the
`Petition. Ex. 1008 (“Davis Decl.”). Paice LLC and the Abell Foundation,
`Inc. (collectively “Patent Owner” or “Paice”) filed a Preliminary Response
`(Paper 13, “Prelim. Resp.”). Taking into account the arguments presented in
`Patent Owner’s Preliminary Response, we determined that there was a
`reasonable likelihood that Petitioner would prevail in its contention that at
`least one of the challenged claims of the ’347 patent is unpatentable under
`35 U.S.C. § 103(a). On November 19, 2020, we instituted inter partes
`review as to the challenged claims and all grounds presented in the Petition.
`Paper 19. (“Dec.”).
`During the course of trial, Patent Owner filed a Patent Owner
`Response. Paper 22. (“PO Resp.”). Patent Owner also filed a Declaration
`of Dr. Mahdi Shahbakhti in support of its response. Ex. 2016 (“Shahbakhti
`Decl.”). Petitioner filed a Reply to Patent Owner’s Response. Paper 28
`(“Pet. Reply”). In support of its Reply, Petitioner submitted a Reply
`Declaration of Dr. Gregory W. Davis. Ex. 1088 (“Davis Reply Decl.).
`Patent Owner filed a Sur-reply. Paper 34 (“Sur-reply”). An oral hearing
`was held on August 25, 2021 and a transcript of the hearing has been entered
`into the record. Paper 47 (“Tr.”).
`We have jurisdiction under 35 U.S.C. § 6. This is a Final Written
`Decision under 35 U.S.C. § 318(a) as to the patentability of the challenged
`2
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`claims of the ’347 patent. For the reasons discussed below, we determine
`Petitioner establishes by a preponderance of the evidence that claims 2, 11,
`17, 24, 33, and 38 of the ’347 patent are unpatentable.
`
`A. Related Matters
`The ’347 patent is currently at issue in Paice LLC v. Bayerische
`Motoren Werke Aktiengesellschaft, 1:19-cv-03348-SAG (D. Md.). Paper 4,
`2. The ’347 patent was subject to review in IPR2014-00571, IPR2014-
`00579, IPR2014-00884, IPR2015-00794, IPR2015-00795, IPR2017-00227,
`IPR2017-00226, and IPR2016-00272. Pet. 72–73. Final Written Decisions
`were issued in IPR2014-00571, IPR2014-00579, IPR2014-00884, IPR2015-
`00794, and IPR2015-00795. Ex. 1003; Ex. 1004; Ex. 1006; Ex. 1010. The
`Federal Circuit affirmed the Board’s Final Written Decisions. Ex. 1005;
`Ex. 1007.
`
`B. Real Parties in Interest
`Petitioner and Patent Owner state that the named entities are the only
`real parties in interest. Pet. 72; Paper 4, 2.
`
`C. The ’347 Patent (Ex. 1001)
`The ’347 patent issued on September 12, 2006, and is titled “Hybrid
`Vehicles.” Ex. 1001, codes (45), (54). The ’347 patent issued from U.S.
`Patent Application 10/382,577 filed March 7, 2003. Id. at codes (21), (22).
`The ’347 patent is directed to hybrid vehicles comprising an internal
`combustion engine, a traction motor, and a battery bank and are controlled
`by a microprocessor so that the engine runs only under high efficiency
`conditions in response to the vehicle’s torque requirements. Id. at code (57).
`
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`Figure 4 of the ’347 patent, reproduced below, illustrates the drive system of
`a hybrid vehicle:
`
`
`
`Figure 4 is “a block diagram of the principal components of the drive
`system” of an embodiment of the hybrid vehicle of the ’347 patent. Id. at
`22:15–16. As shown in Figure 4, the drive system includes internal
`combustion engine 40, starting motor 21, traction motor 25, battery bank 22,
`and microprocessor 48. Id. at 17:5–45. The microprocessor features an
`engine control strategy that runs the engine only under conditions of high
`efficiency, typically when the vehicle’s instantaneous torque requirements
`(i.e., the amount of torque required to propel the vehicle, or “road load”) is
`at least equal to 30% of the engine’s maximum torque output (“MTO”)
`capability. Id. at 20:52–60, 35:5–14; see also id. at 13:47–61 (“the engine is
`never operated at less than 30% of MTO, and is thus never operated
`inefficiently.”).
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`Running the engine only when it is efficient to do so leads to
`improved fuel economy and reduced emissions. Id. at 13:47–51. To achieve
`such efficiency, the hybrid vehicle includes various operating modes that
`depend on the vehicle’s torque requirements, the battery’s state of charge,
`and other operating parameters. Id. at 19:53–55. For example, the hybrid
`vehicle may operate in: (1) an all-electric mode, where only the traction
`motor provides the torque to propel the vehicle and operation of the engine
`would be inefficient (i.e., stop-and-go city driving); (2) an engine-only
`mode, where only the engine provides the torque to propel the vehicle and
`the engine would run at an efficient level (i.e., highway cruising); (3) a
`dual-operation mode, where the traction motor provides additional torque to
`propel the vehicle beyond that already provided by the engine and the torque
`required to propel the vehicle exceeds the maximum torque output of the
`engine (i.e., while accelerating, passing, and climbing hills); and (4) a
`battery recharge mode where the engine operates a generator to recharge the
`battery while the traction motor drives the vehicle. Id. at 35:66–36:58,
`37:26–38:55.
`
`D. Prior Art and Asserted Grounds
`Petitioner asserts that claims 2, 11, 17, 24, 33, and 38 would have
`been unpatentable on the following grounds1:
`
`
`
`1 The Leahy-Smith America Invents Act (“AIA”), Pub. L. No. 112-29, 125
`Stat. 284, 287–88 (2011), amended 35 U.S.C. § 103. Because the ’347
`patent was filed before the effective date of the relevant amendment, the pre-
`AIA version of § 103 applies.
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`Claim(s) Challenged
`24
`33
`38
`2
`11
`17
`24
`2
`2, 24
`11, 33
`17, 38
`
`
`Pet. 9.
`
`35 U.S.C. §
`103(a)
`103(a)
`103(a)
`103(a)
`103(a)
`103(a)
`103(a)
`103(a)
`103(a)
`103(a)
`103(a)
`
`Reference(s)/Basis
`Severinsky2, Graf3
`Severinsky, Ma4
`Severinsky, Ehsani5
`Severinsky, Ehsani, Graf
`Severinsky, Ehsani, Ma
`Severinsky, Ehsani
`Severinsky, Nii6
`Severinsky, Ehsani, Nii
`Bumby7, Graf
`Bumby, Ma
`Bumby, Ehsani
`
`
`
`2 US 5,343,970, issued Sept. 6, 1994 (Ex. 1013, “Severinsky”).
`3 US 6,188,945 B1, issued Feb. 13, 2001 (Ex. 1020, “Graf”).
`4 WO 92/15778, published Sept. 17, 1992 (Ex. 1021, “Ma”).
`5 US 5,586,613, issued Dec. 24, 1996 (Ex.1019, “Ehsani”).
`6 US 5,650,931, issued July 22, 1997 (Ex. 1022, “Nii”).
`7 J.R. Bumby, Computer modelling of the automotive energy requirements
`for internal combustion engine and battery electric-powered vehicles, IEEE
`PROC., v. 132, pt. A, no. 5, 265–279 (Sep. 1985) (Ex. 1014 )(“Bumby I”);
`J.R. Bumby and I. Forster, Optimisation and control of a hybrid electric
`car, IEE PROC., v. 134, pt. D, no. 6, 373–387 (Nov. 1987) (Ex. 1015)
`(“Bumby II”); I. Forster and J.R. Bumby, A hybrid internal combustion
`engine/battery electric passenger car for petroleum displacement, PROC.
`INST. MECH. ENGRS., v. 202, no. D1, 51–64 (Jan. 1988) (Ex. 1016)
`(“Bumby III”); J.R. Bumby and P.W. Masding, A Test-Bed Facility for
`Hybrid IC Engine-Battery Electric Road Vehicle Drive Trains, TRANS.
`INST. MEAS. & CONT., v. 10, no. 2, 87–97 (Apr. 1988) (Ex.
`1017)(“Bumby IV”); P.W. Masding and J.R. Bumby, Integrated
`microprocessor control of a hybrid i.c. engine/battery-electric automotive
`power train, TRANS. INST. MEAS. & CONT., v. 12, no. 3, 128-146 (Jan.
`1990) (Ex. 1018)(“Bumby V”)(collectively “Bumby”).
`6
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`E. The Challenged Claims
`Petitioner challenges dependent claims 2, 11, 17, 24, 33, and 38.
`Pet. 1. Claims 1, 3–10, 14–16, 19–23, 25–30, 32, 36, 37, and 39–41 of the
`’347 patent were previously cancelled. Ex. 1001, 55–58. Each of the
`challenged claims depends directly or indirectly from independent claim 1 or
`independent claim 23 which have both been cancelled. Id. at 58:12–62:52.
`Claim 1 is directed to a hybrid vehicle requiring, inter alia, an internal
`combustion engine, a first electric motor, a second electric motor, a battery,
`and a controller operating the engine and motors according to a setpoint
`(SP). Id. at 58:13–37. The Board previously determined Claim 1 was
`unpatentable over Severinsky and Ehsani and over Bumby alone. Pet. 4–5
`(citing Ex. 1003 (FWD in IPR2014-00571); Ex. 1004 (FWD in IPR2014-
`00579)). Claim 23 is directed to a method of control of a hybrid vehicle
`comprising elements similar to claim 1. Ex. 1001, 60:22–52. The Board
`previously determined Claim 23 was unpatentable over Severinsky alone
`and over Bumby alone. Pet. 4–5 (citing Ex. 1003; Ex. 1004).
`Claim 2 requires that the controller “monitors patterns of vehicle
`operation over time and varies said setpoint SP accordingly.” Ex. 1001,
`58:38–40. Claim 24 contains limitations substantively similar to claim 2.
`Id. at 60:55–57. Claims 11 and 33 require, inter alia, a turbocharger coupled
`to the internal combustion engine. Id. at 59:30–39, 61:52–62:8. Claim 17
`requires that the engine and one electric motor are coupled to a first set of
`wheels and the second electric motor is coupled to a second set of wheels.
`Id. at 59:64–67. Claim 38 requires a clutch and control of the speeds of the
`output shafts of the engine/motors to be substantially equal when the clutch
`is engaged. Id. at 62:29–37.
`
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`II. ANALYSIS
`A. Overview
`Petitioner bears the burden of establishing the unpatentability of any
`claim by a preponderance of the evidence. 35 U.S.C. § 316 (e); 37 C.F.R.
`§ 42.1(d). This burden of persuasion never shifts to Patent Owner. Dynamic
`Drinkware, LLC v. Nat’l Graphics, Inc., 800 F.3d 1375, 1378 (Fed. Cir.
`2015).
`A claim is unpatentable under § 103(a) if the differences between the
`claimed subject matter and the prior art are such that the subject matter, as a
`whole, would have been obvious at the time the invention was made to a
`person having ordinary skill in the art to which said subject matter pertains.
`KSR Int’l Co. v. Teleflex Inc., 550 U.S. 398, 406 (2007). The question of
`obviousness is resolved on the basis of underlying factual determinations,
`including (1) the scope and content of the prior art; (2) any differences
`between the claimed subject matter and the prior art; (3) the level of skill in
`the art; and (4) when in evidence, objective indicia of non-obviousness
`(i.e., secondary considerations).8 Graham v. John Deere Co., 383 U.S. 1,
`17–18 (1966).
`
`B. Level of Ordinary Skill in the Art
`Petitioner contends that a skilled artisan would have “a graduate
`degree in mechanical, electrical or automotive engineering with at least
`some experience in the design and control of combustion engines, electric or
`hybrid electric propulsion systems, or design and control of automotive
`
`
`
`8 The parties have not offered evidence concerning objective indicia of non-
`obviousness.
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`transmissions.” Pet. 5. Petitioner alternately contends that a skilled artisan
`would have “a bachelor’s degree in mechanical, electrical or automotive
`engineering and at least five years of experience in the design of combustion
`engines, electric vehicle propulsion systems, or automotive transmissions.”
`Id. (citing Ex. 1008 ¶¶ 43–46). Patent Owner does not address the level of
`ordinary skill in the art in the Patent Owner Response. See generally PO
`Resp.
`We apply Petitioner’s level of ordinary skill in the art because it
`appears consistent with the problems addressed in the ’347 patent and the
`prior art of record.
`
`C. Claim Construction
`Petitioner submits that three claim terms were construed by the Board
`in prior inter partes reviews of the ’347 patent and that those constructions
`were affirmed by the Federal Circuit on appeal. Pet. 6–7 (citing Ex. 1003, 8,
`11; Ex. 1004, 8, 11; Ex. 1005; Ex. 1011, 13). The terms and the previous
`constructions are as follows:
`
`1) “road load” or “RL” as “amount of instantaneous torque required for
`propulsion of the vehicle”; 2) “setpoint” or “SP” as “a predefined torque
`value that may or may not be reset”; and 3) “monitoring patterns of
`vehicle operation over time” as “monitoring a driver’s repeated driving
`operations over time.”
`
`Patent Owner does not dispute these constructions or request that we
`construe any other terms. PO Resp. 27. Therefore, we apply these claim
`constructions in this Decision.
`
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`D. Claim 24-Alleged Obviousness over Severinsky and Nii
`Claim 24 depends from claim 23 and recites “the further step of
`employing said controller to monitor patterns of vehicle operation over time
`and vary said setpoint SP accordingly.” Ex. 1001, 60:55–57. The Board
`previously determined that claim 23 was unpatentable over Severinsky.
`Ex. 1003, 13–22.
`
`1. Overview of Severinsky–Exhibit 1013
`Severinsky discloses a hybrid electric vehicle comprising an internal
`combustion engine, an electric motor, and a battery. Ex. 1013, code (57).
`Both the electric motor and engine provide torque to drive the vehicle
`wheels. Id. The electric motor alone, using power stored in the battery,
`drives the vehicle at low speeds or in traffic. Id. During acceleration and
`hill climbing, both the electric motor and the engine drive the vehicle. Id.
`During steady state highway driving, the internal combustion engine alone
`drives the vehicle. Id.
`
`2. Overview of Nii – Exhibit 1022
`Nii relates to “a generator output controller for an electric vehicle
`having a generator mounted in addition to a battery.” Ex. 1022, 1:7–9. Nii
`discloses a “travel pattern recognition means for recognizing travel repeated
`in accordance with a specific pattern.” Id. at 2:4–5. Nii provides examples
`of a travel pattern “as people commuting using a standard vehicle, taking
`people to and from their offices using a commercial vehicle.” Id. at 5:61–
`64. Nii discloses that “the output of a generator is set to a generator output
`equal to the power consumption value corresponding to the travel pattern in
`the case of traveling according to a travel pattern.” Id. at 2:13–16. Using
`
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`the travel patterns makes it “possible to minimize power generation.” Id. at
`2:24.
`
`3. Analysis
`
`Petitioner’s Contentions
`i.
`Petitioner provides a claim chart detailing the Board’s prior findings
`that independent claim 23 is unpatentable over Severinsky. Pet. 17–19.
`Patent Owner does not dispute any of Petitioner’s contentions concerning
`claim 23. PO Resp. 41–47.
`Pertinent to our analysis of claim 24, we note that Severinsky
`discloses that its “internal combustion engine is run only in the near vicinity
`of its most efficient operational point, that is, such that it produces
`60%–90% of its maximum torque whenever operated.” Ex. 1013, 20:63–67;
`Pet. 16. The Board previously found the lower limit of this torque range, is
`“a ‘lower level’ setpoint” as recited in claim 23. BMW 1003, 17. Claim 23
`recites employing the electric motor to propel the vehicle when “the
`instantaneous torque RL required to propel the vehicle . . . is less than said
`lower level SP,” employing the engine to propel the vehicle “when the
`torque RL required to do so is between said lower level [setpoint] and
`MTO9,” and employing both the engine and electric motor to propel the
`vehicle when the torque RL “is more than MTO.” Ex. 1001, 60:33–49.
`Petitioner contends Severinsky discloses “a ‘speed-responsive
`hysteresis’ in certain circumstances in performing its mode switching.”
`Pet. 20 (citing Ex. 1013, 18:34–42). Petitioner further contends “Severinsky
`
`
`
`9 “MTO” refers to maximum torque output of the engine. Ex. 1001, 60:25.
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`teaches that the vehicle ‘will operate in a highway mode with the engine
`running constantly after the vehicle reaches a speed of 30-35 mph.’” Id.
`(citing Ex. 1013, 18:36–38). Petitioner further contends that Severinsky
`employs hysteresis during deceleration and “Severinsky continues to run the
`engine unless the ‘speed is reduced to 20-25 mph for a period of time,
`typically 2-3 minutes.’” Id. (citing Ex. 1013, 18:36–40). According to
`Petitioner, “[u]se of the ‘speed-responsive hysteresis’ requires ‘var[ying]
`said setpoint accordingly’ (from the setpoint if the hysteresis is not
`employed).” Id. (citing Ex. 1008 ¶ 404).
`Petitioner turns to Nii for the requirement in claim 24 of “monitoring
`a driver’s repeated driving operations over time.” Pet. 45. Petitioner
`contends Nii’s “controller stores and monitors patterns of vehicle operation
`over time, such as ‘people commuting using a standard vehicle or taking
`people to and from their offices using a commercial vehicle” and Nii
`“describes ‘recognizing a travel pattern when a [sic] travelling under the
`same condition is repeated a predetermined number of times or more.’” Id.
`at 44–45 (citing Ex. 1022, 2:4–5, 2:21–24, 3:7–9, 5:59–64, 6:43–51).
`Petitioner also contends Nii “stores travel patterns over time so that the
`‘target generator output becomes more accurate.’” Id. at 45 (citing
`Ex. 1022, 6:9–13). Petitioner further contends it would have been obvious
`“to use Nii’s teachings of using a driver’s repeated pattern of operation in
`order to also adjust the setpoint” of Severinsky in order to “further enhance
`the efficiency of Severinsky’s use of hysteresis in . . . performing mode
`switching” and “to account for other special circumstances where it may be
`preferable to ‘use the engine somewhat inefficiently rather than to discharge
`the batteries excessively,’ or to avoid ‘nuisance’ starts and stops of the
`engine.” Id. at 45–46 (citing Ex. 1008 ¶ 610; Ex. 1013, 18:23–42).
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`Petitioner further contends that a skilled artisan would have been motivated
`to vary Severinsky’s engine setpoint by using Nii’s pattern information
`rather than an arbitrary time period “in order to enhance the vehicle’s
`efficiency including when employing hysteresis since the pattern
`information would be reflective of actual vehicle usage, rather than of
`arbitrarily-set parameters.” Id. at 46 (citing Ex. 1008 ¶ 612). Petitioner
`further contends that a skilled artisan would have a reasonable expectation of
`success because incorporating Nii’s pattern monitoring functioning into
`Severinsky’s controller “would only require modifying Severinsky’s logic to
`use the information reflecting the driver’s repeated driving operations over
`time, rather than simply using arbitrarily-set parameters.” Id. at 47–48
`(citing Ex. 1008 ¶¶ 614–615).
`Patent Owner’s First Contention
`ii.
`Patent Owner first contends “Severinsky’s ‘speed-responsive
`hysteresis’ does not result in varying a speed- or torque-based setpoint.” PO
`Resp. 18 (citing Pet. 20). Patent Owner argues that Severinsky’s “speed-
`responsive hysteresis” mode “is simply a time-based hysteresis that adds a
`time delay (‘2-3 minutes’) to a speed threshold (‘20-25 mph’) for turning the
`engine off.” Id. at 19 (citing Ex. 2016 ¶¶ 105–106). Patent Owner further
`contends this mode “maintains a fixed speed threshold and requires that the
`vehicle speed remain below the speed threshold for a predetermined amount
`of time” and a skilled artisan “would understand that the threshold would be
`written into source code and not change throughout the lifetime of the
`vehicle.” Id. (citing Ex. 2016 ¶¶ 108–109). Patent Owner further contends
`that “there is no record evidence that the speed-based time delay or the use
`of different speed thresholds for turning the engine on vs. turning the engine
`off would result in Severinsky ‘varying said setpoint’ which is a torque
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`value.” Id. (citing Ex. 2016 ¶¶ 112–115). Patent Owner further contends
`that a skilled artisan would understand Severinsky discloses two “separate
`control algorithms would operate in parallel: the speed-based algorithm (in
`which vehicle speed is the control variable) and the torque-based algorithm
`(in which road load is the control variable) both send signals to the controller
`to turn the engine on/off.” Id. at 21 (citing Ex. 2016 ¶¶ 113-115). Patent
`Owner further contends that “[t]he physical relationship between speed and
`torque does not bridge the chasm between Severinsky’s separate speed and
`torque-based algorithms” because “inasmuch as that speed may affect the
`torque required to propel the vehicle, vehicle speed and torque are both
`independent variables that do not vary proportionately under many
`conditions.” Id. at 22 (citing Ex. 2016 ¶ 116). Patent Owner provides the
`following illustration of a vehicle traveling over a hill to support this
`contention:
`
`The preceding image provided by Patent Owner shows a vehicle traveling
`from left to right from flat ground and then up and over a hill to illustrate
`
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`that “the instantaneous torque required to propel the vehicle varies with
`grade and has no dependence on speed.” PO Resp. 23.
` According to Patent Owner, “when the speed is low and the instantaneous
`torque is high . . . . a [skilled artisan] would understand that Severinsky
`would need to arbitrate between the speed-based algorithm and the torque-
`based algorithm by prioritizing one over the other”, and that “Severinsky’s
`decision to prioritize the ‘speed-based hysteresis’ algorithm simply results in
`disregarding the alleged torque-based setpoint (60% MTO), not varying it.”
`Id. at 23–24 (citing Ex. 2016 ¶¶ 122–123).
`
`Petitioner, in turn, contends that “Severinsky’s engine will normally
`be operated above 60% MTO––i.e., the claimed ‘setpoint’ . . . but
`Severinsky also teaches operating its engine ‘outside its most fuel efficient
`operating range on occasion.’” Pet. Reply 8 (citing Dec. 23–24; Ex. 1013,
`18:23–25). Petitioner contends that “Severinsky will ‘vary said setpoint’ by
`lowering it below 60% MTO (which corresponds to 30–35 mph speed in
`‘highway mode’) to avoid nuisance engine starts” and “Severinsky also
`discloses ‘varying said setpoint’ in other non-hysteresis situations, such as to
`avoid discharging the batteries excessively.” Id. (citing Dec. 32; Pet. 20,
`46–47; Ex. 1013, 18:25–33; Ex. 1088 ¶¶ 9–10). Petitioner further contends
`Patent Owner’s argument that Severinsky’s hysteresis is speed-based only
`rather than a torque-based setpoint is “‘a red herring’” because
`“Severinsky’s control system does not take only speed into account––the
`Board debunked that argument years ago. . . but must also take torque into
`account.” Id. (citing PO Resp. 20–23; Ex. 1003, 15–17; Ex. 1088 ¶¶ 8–26);
`see also id. at 11 (arguing that Patent Owner’s arguments are precluded by
`determinations in prior inter partes review of ’347 patent).
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`Petitioner next contends “[w]hile PO asserts that Severinsky’s normal
`30–35 mph/60% MTO ‘threshold would be written into source code and
`would not change’ . . . the challenged claims are agnostic as to how ‘varying
`said setpoint’ is accomplished.” Pet. Reply 10 (citing Prelim. Resp. 18–20;
`Ex. 1088 ¶¶ 27–29). Petitioner contends both Severinsky and the ’347
`patent vary the setpoint during hysteresis in the same way. Id. (citing Ex.
`1001, 41:10–54). According to Petitioner, “if the vehicle drops below the
`lower setpoint, the engine will be shut off,” but “[t]he original setpoint is not
`disregarded but replaced––i.e., it is ‘varied’––by a different (lower) setpoint
`corresponding to 20-25 mph during hysteresis, as is confirmed in the ’347
`Patent.” Id. at 11 (citing Ex. 1001, 41:10–54; Ex. 1088 ¶ 30).
`In the Sur-reply, Patent Owner contends that “Severinsky’s choice to
`operate the engine below the 60% MTO setpoint does not mean that
`Severinsky varies the setpoint” rather it means “Severinsky operates the
`engine inefficiently in certain circumstances (i.e., below 60% MTO).” Sur-
`reply, 4. Patent Owner further contends that Petitioner’s “insinuation that
`Severinsky’s controller ‘switch[es] between two (or more) values that
`represent the ‘setpoint’ at any given time’ is wrong” because, according to
`Patent Owner, “[t]here is no variation or dynamic ‘switching’ of the
`different thresholds to speak of.” Id. at 5 (citing Reply 10, Ex. 2016
`¶¶ 110–111). Patent Owner further contends that “[t]he word ‘accordingly’
`indicates that the ‘controller’ must vary the setpoint based on vehicle
`monitoring over time. BMW, however provides no evidence that
`Severinsky’s controller selects between the engine on and engine off
`thresholds in real time, much less based on observed vehicle operation.” Id.
`at 6–7.
`
`16
`
`
`
`IPR2020-00994
`Patent 7,104,347 B2
`
`Patent Owner also contends that Petitioner’s “assertions that
`‘Severinsky’s speed-based thresholds correlate to torque-based thresholds’
`and ‘speed thresholds’ are also torque thresholds by their very nature’ . . .
`are new arguments” and exceed the proper scope of a Reply. Paper 32, 2
`(citing Reply 9–10); Sur-reply 8 n.6. Patent Owner contends the Petition
`“did not explain any relationship between ‘speed thresholds’ and ‘torque
`thresholds.’” Id. Patent Owner makes similar arguments against
`“paragraphs 9–26 of Dr. Davis’s reply declaration (Ex. 1088)” and Exhibits
`1015, 1091, and 1092 that are referenced in Dr. Davis’s reply declaration.
`Petitioner responds that pages 9 and 10 of the Reply and paragraphs
`9–26 of Dr. Davis’s Reply
`directly rebut and respond to (i) the POR argument that Severinsky’s
`hysteresis is only speed based while the “setpoint” claimed in the ’347
`Patent is “a torque value;” and (ii) the POR’s acknowledgement of a
`“physical relationship between speed and torque,” but argument that it
`“does not bridge the chasm between Severinsky’s separate speed and
`torque-based algorithms.
`Paper 33, 2 (citing PO Resp. 20–23). Petitioner further argues that Exhibit
`1015 has been part of the record since the Petition was filed and “Exhibit
`1092 contains omitted excerpts from a 2005 textbook that PO submitted with
`its POR as Exhibit 2020.” Id.
`
`For the following reasons, we are persuaded Severinsky teaches
`“vary[ing] said setpoint SP,” as required by claim 24, during the hysteresis
`mode.
`We first discuss the Board’s prior findings in IPR2014-00571 to place
`in context the parties’ contentions regarding the question of whether
`Severinsky’s hysteresis mode is a speed based threshold only, as Patent
`Owner asserts, or is also a torque based threshold as Petitioner asserts.
`
`17
`
`
`
`IPR2020-00994
`Patent 7,104,347 B2
`
`Patent Owner is correct that the Board previously found Severinsky’s 60%
`MTO corresponds to the lower level setpoint (SP) recited in claim 23.
`Ex. 1003, 17 (IPR2014-00571, Paper 44, 17 (PTAB Sept. 28, 2015)). In that
`case, Patent Owner made arguments that are substantially similar to the
`arguments it raises here. For example, the Board quoted Patent Owner that
`“Severinsky determines when to turn the engine on based on the speed of the
`vehicle in contrast to the ’347 patent, which turns the engine on based on
`road load,” “nowhere does Severinsky disclose that road load or any other
`torque demand is considered when determining when to employ the engine
`or if the road load is above the setpoint when the engine is operated,” and
`“Severinsky ‘uses speed as the one factor in determining whether to employ
`the engine.’” Id. at 15. In the face of these arguments, the Board found that
`“[a]lthough Severinsky describes the use of ‘speed’ as a factor considered by
`the microprocessor, Severinsky makes clear that the microprocessor also
`uses the vehicle’s ‘torque’ requirements in determining when to run the
`engine.” Id. at 16 (citing Ex. 1013, 17:11–15) (emphasis added). In
`addition, the Board found that “torque and speed are not mutually exclusive
`concepts” and noted that the “’347 patent itself speaks of ‘speed’ when
`describing the vehicle’s various operating modes.” Id. at 18 (citing
`Ex. 1001, 17:34–37, 19:35–36).
`We now turn to Patent Owner’s contentions that Petitioner exceeds
`the proper scope of a reply. Petitioner “may not submit new evidence or
`argument in reply that it could have presented earlier” but “may submit
`rebuttal evidence in support of its reply.” Consolidated Trial Practice Guide
`(“Consol. TPG”), 73 (Nov. 2019). In this case, Patent Owner specifically
`argues that Severinsky’s hysteresis mode is speed-based not torque-based.
`See PO Resp. 20 (“there is no record evidence that the speed-based timed
`18
`
`
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`IPR2020-00994
`Patent 7,104,347 B2
`
`delay . . . would result in Severinsky ‘varying said setpoint,’ which is a
`torque value.”). Thus, we agree with Petitioner that its Reply at pages 9–10
`and paragraphs 9–26 of Dr. Davis’s Reply Declaration directly respond to
`the issue raised by Patent Owner concerning whether Severinsky’s hysteresis
`mode results in varying a torque-based setpoint.10 In addition, in our
`Decision on Institution, we referenced the Board’s extensive discussion in
`IPR2014–0571 of the relationship between torque and speed in Severinsky’s
`control system. Dec. 31–32. Our Trial Practice Guide also allows
`Petitioner’s Reply to address “issues discussed in the institution decision.”
`Consol. TPG at 79. Therefore, to the extent necessary, we consider the
`arguments in Petitioner’s Reply as well as paragraphs 9 to 26 of Dr. Davis’s
`Reply Declaration and the exhibits referenced therein.
`Patent Owner provides numerous arguments why Severinsky’s
`hysteresis mode is speed-based rather than torque-based. However, Patent
`Owner never directly reconciles those arguments with the Board’s finding in
`IPR2014–00571 that Severinsky’s microprocessor considers both speed and
`torque when determining whether to run the engine. Ex. 1003, 16; see also
`Pet. Reply 8 (“Severinsky’s control system does not take only speed into
`account––the Board debunked that argument years ago . . . but must also
`take torque into account.”) (citing Ex. 1003, 15–17; Ex. 1088 ¶¶ 8–26). In
`fact, Patent Owner and Dr. Shahbakhti both acknowledge “speed may affect
`the torque required to propel the vehicle.” PO Resp. 22; Ex. 2016 ¶ 116.
`Further, Patent Owner relies on Dr. Shahbahkti’s testimony that
`
`
`
`10 We note that Patent Owner deposed Dr. Davis and questioned him on his
`Reply Declaration. See e.g. Ex. 2029, 31:4–5.
`
`19
`
`
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`IPR2020-00994
`Patent 7,104,347 B2
`
`Severinsky’s controller considers both speed and torque in connection with
`his diagram illustrating the torque required to propel a vehicle over a hill at
`constant speed. PO Resp. 23 (citing Ex. 2016 ¶ 122) (“when the speed is
`low and the instantaneous torque is high . . . a POSA would understand that
`Severinsky would need to arbitrate between the speed-based algorithm and
`the torque-based algorithm by prioritizing one over the other.”). According
`to Patent Owner, “Severinsky’s decision to prioritize the ‘speed-based
`hysteresis’ algorithm simply results in disregarding the alleged torque-based
`setpoint (60% MTO), not varying it.” Id. at 24 (citing Ex. 2016 ¶ 123)
`(emphasis added); see a
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