Paper: 10
`Trials@uspto.gov
` Date: February 16, 2021
`571-272-7822
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`CODE200, UAB; TESO LT, UAB; METACLUSTER LT,
`UAB; AND OXYSALES, UAB,
`Petitioner,
`
`v.
`
`LUMINATI NETWORKS LTD.,
`Patent Owner.
`____________
`
`IPR2020-01506
`Patent 10,469,614 B2
`____________
`
`
`
`Before THOMAS L. GIANNETTI, SHEILA F. McSHANE, and
`RUSSELL E. CASS, Administrative Patent Judges.
`
`CASS, Administrative Patent Judge.
`
`
`
`DECISION
`Denying Institution of Inter Partes Review
`35 U.S.C. § 314
`
`
`
`Trials@uspto.gov
` Date: February 16, 2021
`571-272-7822
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`CODE200, UAB; TESO LT, UAB; METACLUSTER LT,
`UAB; AND OXYSALES, UAB,
`Petitioner,
`
`v.
`
`LUMINATI NETWORKS LTD.,
`Patent Owner.
`____________
`
`IPR2020-01506
`Patent 10,469,614 B2
`____________
`
`
`
`Before THOMAS L. GIANNETTI, SHEILA F. McSHANE, and
`RUSSELL E. CASS, Administrative Patent Judges.
`
`CASS, Administrative Patent Judge.
`
`
`
`DECISION
`Denying Institution of Inter Partes Review
`35 U.S.C. § 314
`
`
`
`
`IPR2020-01506
`Patent 10,469,614 B2
`
`I. INTRODUCTION
`Petitioner (collectively, Code200, UAB; Teso LT, UAB; Metacluster
`LT, UAB; and Oxysales, UAB) filed a Petition (Paper 5, “Pet.”) requesting
`inter partes review of claims 1, 2, 4–13, 15–20, 22, 23, 25, 26, 28, and 29
`(“the challenged claims”) of U.S. Patent No. 10,469,614 B2 (Ex. 1001, “the
`’614 patent”). Patent Owner, Luminati Networks, LTD., filed a Preliminary
`Response (Paper 9, “Prelim. Resp.”).
`The Board has authority to determine whether to institute an inter
`partes review. See 35 U.S.C. § 314; 37 C.F.R. § 42.4(a). Under 35 U.S.C.
`§ 314(a), we may not authorize an inter partes review unless the information
`in the petition and the preliminary response “shows that there is a reasonable
`likelihood that the petitioner would prevail with respect to at least 1 of the
`claims challenged in the petition.” The Board, however, has discretion to
`deny a petition even when a petitioner meets that threshold. Id.; see, e.g.,
`Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct. 2131, 2140 (2016) (“[T]he
`agency’s decision to deny a petition is a matter committed to the Patent
`Office’s discretion.”); NHK Spring Co. v. Intri-Plex Techs., Inc., IPR2018-
`00752, Paper 8 (PTAB Sept. 12, 2018) (precedential).
`Both the Petition and Preliminary Response address the issue of
`whether we should exercise our discretion under 35 U.S.C. § 314(a) to deny
`institution of inter partes review. Pet. 5–8; Prelim. Resp. 4–13.
`For the reasons that follow, we exercise our discretion under 35
`U.S.C. § 314(a) to deny institution of inter partes review.
`
`
`2
`
`
`
`IPR2020-01506
`Patent 10,469,614 B2
`
`II. BACKGROUND
`A. Real Parties in Interest
`Petitioner identifies the following as the real parties in interest:
`Code200, UAB; Teso LT, UAB; Metacluster LT, UAB; Oxysales, UAB, and
`coretech lt, UAB. Pet. 1.
`Patent Owner identifies Luminati Networks LTD as the real party in
`interest. Paper 7, 2.
`B. Related Proceedings
`The parties identify the following litigations in the Eastern District of
`Texas involving the ’614 patent: Luminati Networks Ltd. v. Teso LT, UAB et
`al., 2:19-cv-00395-JRG (E.D. Tex.) (“the 395 district court case”), Luminati
`Networks Ltd. v. BI Science, 2-19-cv-397 (E.D. Tex.), and Luminati
`Networks Ltd. v. Tefincom S.A. D/B/A NordVPN, 2:19-cv-00414-JRG (E.D.
`Tex.). Pet. 1; Paper 7, 3.
`The parties also identify two additional inter partes review
`proceedings filed by some or all of the entities of Petitioner against Patent
`Owner’s patents: IPR2020-01266, which is directed to U.S. Patent No.
`10,257,319, and IPR2020-01358, which is directed to U.S. Patent No.
`10,484,510. Pet. 1–2; Paper 7, 2–3.
`C. The ’614 Patent
`The ’614 patent is titled “System and Method for Improving Internet
`Communication by Using Intermediate Nodes” and issued on November 5,
`2019, from an application filed on December 10, 2018. Ex. 1001, codes
`(22), (45), (54). The application for the ’614 patent is a continuation of
`several applications, and other related applications include a divisional
`application and a provisional application. See id., code (60).
`
`
`3
`
`
`
`IPR2020-01506
`Patent 10,469,614 B2
`The ’614 Patent is directed to a system for fetching content from a
`web server to a client device using tunnel devices serving as intermediate
`devices. Ex. 1001, code (57). The client device accesses an acceleration
`server to receive a list of available tunnel devices. Id. The requested
`content is partitioned into slices, and the client device sends a request for the
`slices to the available tunnel devices. Id. The tunnel devices in turn fetch
`the slices from the data server, and send the slices to the client device, where
`the content is reconstructed from the received slices. Id.
`A client device may also serve as a tunnel device, serving as an
`intermediate device to other client devices. Id. Similarly, a tunnel device
`may also serve as a client device for fetching content from a data server. Id.
`The selection of tunnel devices to be used by a client device may be in the
`acceleration server, in the client device, or both. Id. The partition into slices
`may be overlapping or non-overlapping, and the same slice (or the whole
`content) may be fetched via multiple tunnel devices. Id.
`D. Illustrative Claim
`Claim 1 is the only independent claim, and is illustrative of the
`challenged claims. Claim 1 recites:
`1. A method for use with a resource associated with a criterion
`in a client device that communicates with a first server over the
`Internet, the client device is identified in the Internet using a
`first identifier and is associated with first and second state
`according to a utilization of the resource, the method
`comprising:
`initiating, by the client device, communication with the first
`server over the Internet in response to connecting to the
`Internet, the communication comprises sending, by the
`client device, the first identifier to the first server over
`the Internet;
`
`4
`
`
`
`IPR2020-01506
`Patent 10,469,614 B2
`when connected to the Internet, periodically or continuously
`determining whether the resource utilization satisfies
`the criterion;
`responsive to the determining that the utilization of the
`resource satisfies the criterion, shifting to the first state
`or staying in the first state;
`responsive to the determining that the utilization of the
`resource does not satisfy the criterion, shifting to the
`second state or staying in the second state;
`responsive to being in the first state, receiving, by the client
`device, a request from the first server; and
`performing a task, by the client device, in response to the
`receiving of the request from the first server,
`wherein the method is further configured for fetching over
`the Internet a first content identified by a first content
`identifier from a web server that is distinct from the first
`server, and the task comprising:
`receiving, by the client device, the first content
`identifier from the first server;
`sending, by the client device, the first content identifier
`to the web server;
`receiving, by the client device, the first content from the
`web server in response to the sending of the first
`content identifier; and
`sending, by the client device, the received first content
`to the first server.
`Ex. 1001, 172:44–173:13.
`E. Prior Art
`Petitioner relies on the following prior art:
`1. Mithyantha, United States Patent No. 8,972,602 B2
`(Ex. 1011, “Mithyantha”);
`2. Marc Rennhard, MorphMix – A Peer-to-Peer-based
`System for Anonymous Internet Access (2004) (Doctoral Thesis)
`(Ex. 1012, “MorphMix”);
`
`5
`
`
`
`IPR2020-01506
`Patent 10,469,614 B2
`3. Network Working Group, RFC 2616 (Ex. 1016, “RFC
`2616”).
`
`F. The Asserted Grounds
`Petitioner challenges claims 1, 2, 4–13, 15–20, 22, 23, 25, 26, 28, and
`29 of the ’614 patent on the following grounds (Pet. 4–5):
`
`Claims Challenged
`1, 2, 4–13, 15–20, 22,
`23, 25, 26, 29
`1, 2, 4–13, 15–20, 22,
`23, 25, 26, 28, 29
`
`1, 2, 4, 5, 7–10, 13,
`17–20, 22, 23, 25, 26,
`29
`1, 2, 4–13, 15–20, 22,
`23, 25, 26, 28, 29
`
`
`
`35 U.S.C. §
`1021
`
`References
`Mithyantha
`
`103
`
`102
`
`103
`
`Mithyantha, Knowledge of
`Person of Ordinary Skill, RFC
`2616
`MorphMix
`
`MorphMix, Knowledge of
`Person of Ordinary Skill, RFC
`2616
`
`III. ANALYSIS
`Patent Owner contends that we should exercise our discretion to deny
`institution under 35 U.S.C. § 314(a), relying on the Board’s precedential
`decision in Apple Inc. v. Fintiv Inc., IPR2020-00019, Paper 11 (PTAB
`March 20, 2020) (“Fintiv”). Prelim. Resp. 4–13. Patent Owner contends
`that the parallel 395 district court case, which asserts the same prior art as
`the Petition, begins jury selection over nine months before a final
`
`
`1 The Leahy-Smith America Invents Act (“AIA”), Pub. L. No. 112-29, 125
`Stat. 284, 287–88 (2011), amended 35 U.S.C. §§ 102 and 103. Because the
`’614 patent was filed after March 16, 2013 (the effective date of the relevant
`amendments), the current versions of §§ 102 and 103 apply.
`
`6
`
`
`
`IPR2020-01506
`Patent 10,469,614 B2
`determination would be expected in this proceeding. Prelim. Resp. 4.
`Anticipating Patent Owner’s challenge, Petitioner addresses the § 314(a)
`issue in its Petition. Pet. 5–8.
`A. Fintiv Factors
`Fintiv identifies a non-exclusive list of factors the Board may address
`where there is a related, parallel district court action to determine whether
`such action provides any basis to exercise discretion to deny institution of
`inter partes review. Fintiv, Paper 11 at 5–16. Those factors include:
`1. whether the court granted a stay or evidence exists that one
`may be granted if a proceeding is instituted;
`2. proximity of the court’s trial date to the Board’s projected
`statutory deadline for a final written decision;
`3. investment in the parallel proceeding by the court and the
`parties;
`4. overlap between issues raised in the petition and in the
`parallel proceeding;
`5. whether the petitioner and the defendant in the parallel
`proceeding are the same party; and
`6. other circumstances that impact the Board’s exercise of
`discretion, including the merits.
`Id. at 5–6.
`In evaluating the factors, we take a holistic view of whether efficiency
`and integrity of the system are best served by denying or instituting review.
`Fintiv at 6.
`
`B. The 395 District Court Case
`The 395 district court case is pending before District Judge Rodney
`Gilstrap, in the United States District Court for the Eastern District of Texas,
`Marshall Division. Judge Gilstrap entered a Docket Control Order setting
`December 14, 2020, as the deadline for completing fact discovery, January
`
`7
`
`
`
`IPR2020-01506
`Patent 10,469,614 B2
`21, 2021, as the deadline for completing expert discovery, and May 3, 2021,
`for jury selection and trial. Ex. 1004, 1, 3. The parties have advised us that
`the date for jury selection has been moved to May 10, 2021.
`The Court conducted a Markman hearing, and on December 7, 2020,
`issued a Claim Construction Opinion and Order. Ex. 2016.
`Patent Owner advised us (and we have independently confirmed) that
`in a November 20, 2020 Order, Judge Gilstrap continued jury trial dates in
`cases scheduled for trial from December 2020 through February 2021 due to
`the COVID-19 pandemic. Prelim. Resp. 8. Patent Owner asserts that “[t]he
`Order does not impact the present parallel district court case which has a
`trial date scheduled outside of that time frame—May 10, 2021.” Id. at 8–9
`(citing Ex. 2008). We have not been informed of any change in the May 10,
`2021 jury selection date in the 395 district court case.
`A. Analysis of the Fintiv Factors
`Both Petitioner and Patent Owner address the Fintiv factors in their
`submissions. We conclude that overall, the factors favor exercising our
`discretion to decline to institute a trial. Our reasoning follows.
`1. Factor 1 — Stay of Related Litigation Proceeding
`Petitioner filed a motion to stay the 395 district court case, which was
`denied without prejudice as premature because it was filed in advance of the
`Board’s decision to institute inter partes reviews on any of the asserted
`patents in the litigation.2 Ex. 2015, 3. Although the district court denied the
`motion without prejudice, with refiling permitted within 24 days of the
`Board’s institution decisions for all of the asserted patents, Patent Owner
`
`
`2 Three patents, the ’614 patent as well as U.S. Patent Nos. 10,257,319 B2
`and 10,484,510 B2, are asserted in the 395 district court case. Ex. 2015, 1.
`
`8
`
`
`
`IPR2020-01506
`Patent 10,469,614 B2
`argues that the District Court has not indicated one way or the other whether
`a stay is likely to be granted at that time. Prelim. Resp. 6.
`
`Because the Board has previously “decline[d] to infer” how a District
`Court would decide a stay motion, Petitioner asserts that this factor is
`neutral. Pet. 6 (quoting Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 15
`at 12 (PTAB May 13, 2020) (informative) (“Fintiv II”). Patent Owner
`argues that because the District Court has not granted a stay and “would not
`likely grant a stay given the lateness of the Petition (and further, the
`additional lateness that would be associated with another round of briefing in
`the 395 District Court Case on any renewed motion to stay), this factor
`favors denial of institution.” Prelim Resp. 6–7.
`Under the present circumstances, on the record presented, we decline
`to speculate on the likelihood of how the District Court may rule on a future
`motion to stay. Accordingly, we find that this factor is neutral.
`2. Factor 2 — Proximity of Court’s Trial Date
`Patent Owner argues that the Petition should be denied because jury
`selection in the 395 district court case is scheduled approximately nine
`months before a final determination would issue in this case. Prelim. Resp.
`4, 7–9.
`
`Petitioner alleges that Patent Owner has previously sought to delay
`trials as the set trial date approaches. Pet. 6 (referring to Luminati Networks
`Ltd. v. UAB Tesonet, No. 2:18-cv-00299-JRG (E.D. Tex.)). Petitioner
`argues that in light of Patent Owner’s history and the potential for COVID-
`related delays, Factor 2 is neutral. Id. Patent Owner responds that the
`previous litigation has been misrepresented by Petitioner, and instead Patent
`Owner filed a motion to consolidate the referenced case with another case to
`
`9
`
`
`
`IPR2020-01506
`Patent 10,469,614 B2
`accelerate the date by which the ’614 patent infringement claims could be
`tried. Prelim. Resp. 6–7.
`
`As mentioned above, Petitioner additionally brings to our attention
`Judge Gilstrap’s Order to continue jury trials from December 2020 through
`February of 2021, but the communication notes that Petitioner does not
`know what impact the continuances may have on the trial date in this case.
`See Ex. 3001. Patent Owner asserts that Judge Gilstrap’s Order does not
`impact the schedule for trial in the case, and “no other facts can be inferred
`from the Order.” Prelim. Resp. 8–9.
`
`As Patent Owner asserts, the related jury trial in the 395 district court
`case is currently scheduled to occur approximately nine months before a
`final determination would issue in this case. Although a delay in the trial
`date is possible, presuming that there would be a delay on the record before
`us, or estimating what such a delay might be, is uncertain at this time.
`Accordingly, we agree with Patent Owner that, under our precedential Fintiv
`decision, on the record before us, the approximately nine month gap between
`the scheduled trial date and the estimated date of a final written decision in
`this proceeding favors exercising our discretion to deny institution of inter
`partes review. See Fintiv at 9.
`3. Factor 3 — Investment in the Parallel Proceeding
`It is undisputed that at this time that claim construction briefing has
`been completed, a Markman hearing was conducted, and a claim
`construction order issued in the 395 district court case, which includes
`interpretation of claim terms associated with the ’614 patent. See Ex. 2016,
`14–16. Under the Docket Control Order, fact discovery in that case was
`completed on December 14, 2020, and expert discovery was completed on
`
`10
`
`
`
`IPR2020-01506
`Patent 10,469,614 B2
`January 21, 2021. See Ex. 1004, 1, 3. The parties have not advised us of
`any changes to those dates as scheduled.
`
`Accordingly, in view of the status of the progress of the 395 district
`court case, particularly the fact that the deadlines for fact and expert
`discovery have passed and a claim construction order has issued, we agree
`with Patent Owner that this factor favors exercising our discretion to deny
`institution of inter partes review. See Prelim. Resp. 9–10.
`4. Factor 4 — Overlap With Issues Raised in the Parallel
`Proceeding
`Petitioner asserts that because claims 1–2, 4–7, 9–12, 15–20, 22–23,
`25–26, and 28–29 are asserted in the 395 district court case, but the Petition
`also challenges claims 8 and 13 of the ’614 patent, this factor weighs in
`favor of institution. Pet. 7.
`
`Patent Owner argues that the overlap of the issues raised in the
`Petition and the 395 district court case are substantial. Prelim. Resp. 10.
`More specifically, Patent Owner contends that the Mithyantha, MorphMix,
`and RFC 2616 prior art used in the challenges in this proceeding are all
`identified in the invalidity contentions in the 395 district court case. Id. at
`10–11 (citing Ex. 2006, ¶¶ 5–6). Patent Owner also asserts that only claim 1
`of the ’614 patent is independent, and the additional claims challenged in the
`Petition are all dependent. Id. at 11.
`
`In light of the common prior art asserted here and in the 395 district
`court case, as well as the common challenge to the sole independent claim
`and all but two of the dependent claims of the ’614 patent, we agree with the
`Patent Owner that the overlap in issues between the two proceedings is
`substantial. Additionally, we have not been advised of any stipulations filed
`or actions taken by Petitioner to reduce the overlap between the proceedings.
`
`11
`
`
`
`IPR2020-01506
`Patent 10,469,614 B2
`See, e.g., Sotera Wireless, Inc. v. Masimo Corp., IPR 2020-01019, Paper 12
`at 18–19 (PTAB Dec. 1, 2020) (precedential as to § II.A) (determining that
`Petitioner’s broad stipulation not to pursue in district court any ground that it
`raised or could have raised in the IPR weighs strongly in favor of
`institution); Sand Revolution II, LLC v. Continental Intermodal Group –
`Trucking LLC, IPR2019-01393, Paper 24 at 11–12 (PTAB Jun. 16, 2020)
`(informative) (instituting inter parties review, and noting that Petitioner’s
`stipulation not to pursue the IPR grounds in the district court litigation
`“mitigates to some degree the concerns of duplicative efforts between the
`district court and the Board, as well as concerns of potentially conflicting
`decisions”). Accordingly, we determine that this factor favors exercising
`our discretion to deny institution of inter partes review.
`5. Factor 5 — Commonality of Parties in the Parallel
`Proceedings
`Petitioner asserts that Code200 is a named petitioner here, but is not a
`
`defendant in the 395 district court case. Pet. 7–8. Patent Owner argues that
`three of the four named petitioners are also defendants in the 395 district
`court case. Prelim. Resp. 11. Patent Owner also asserts that there is a close
`corporate relationship between Code200 and the other petitioners because
`they share a common parent company. Id. at 11–13 (citing Ex. 2013; Ex.
`2014). Petitioner does not challenge this contention.
`
`Given the commonality of most of the parties in this proceeding and
`395 district court case, we find that this factor favors exercising our
`discretion to deny of institution.
`6. Factor 6 — Other Circumstances
`Petitioner contends that the challenged patent is “extraordinarily
`
`weak,” and policy favors instituting review under these circumstances. Pet.
`
`12
`
`
`
`IPR2020-01506
`Patent 10,469,614 B2
`8. Patent Owner disagrees, arguing that Petitioner’s reading of the claims is
`unreasonable and the asserted prior art is weak. Prelim. Resp. 13.
`
`We have reviewed Petitioner’s unpatentability arguments and Patent
`Owner’s preliminary responses, and based on the limited record before us,
`we do not find that the merits outweigh the other Fintiv factors favoring
`exercising our discretion to deny institution.
`7. Conclusion
`The majority of the Fintiv factors, particularly factors 2 (the proximity
`
`of the trial date in the 395 district court case), 3 (investment in the parallel
`proceeding), and 4 (overlap with issues raised in parallel proceeding), favor
`exercising our discretion to deny institution. Thus, based on our assessment
`of the Fintiv factors, we exercise our discretion under 35 U.S.C. § 314(a) to
`deny inter partes review.
`
`IV. ORDER
`
`Accordingly, it is
`ORDERED that the Petition is denied as to all grounds and all
`challenged claims of the ’614 patent.
`
`
`13
`
`
`
`IPR2020-01506
`Patent 10,469,614 B2
`
`PETITIONER:
`
`Craig Tolliver
`George Scott
`CHARHON, CALLAHAN, ROBSON & GARZA
`ctolliver@toliverlawfirm.com
`jscott@ccrglaw.com
`
`
`PATENT OWNER:
`
`Thomas M. Dunham
`Don F. Livornese
`RUYAKCHERIAN LLP
`tomd@dunham.cc
`donl@ruyakcherian.com
`
`
`
`
`14
`
`
Accessing this document will incur an additional charge of $.
After purchase, you can access this document again without charge.
Accept $ Charge
Still Working On It
This document is taking longer than usual to download. This can happen if we need to contact the court directly to obtain the document and their servers are running slowly.
Give it another minute or two to complete, and then try the refresh button.
A few More Minutes ... Still Working
It can take up to 5 minutes for us to download a document if the court servers are running slowly.
Thank you for your continued patience.
This document could not be displayed.
We could not find this document within its docket. Please go back to the docket page and check the link. If that does not work, go back to the docket and refresh it to pull the newest information.
Your account does not support viewing this document.
You need a Paid Account to view this document. Click here to change your account type.
Your account does not support viewing this document.
Set your membership
status to view this document.
With a Docket Alarm membership, you'll
get a whole lot more, including:
- Up-to-date information for this case.
- Email alerts whenever there is an update.
- Full text search for other cases.
- Get email alerts whenever a new case matches your search.
One Moment Please
The filing “” is large (MB) and is being downloaded.
Please refresh this page in a few minutes to see if the filing has been downloaded. The filing will also be emailed to you when the download completes.
Your document is on its way!
If you do not receive the document in five minutes, contact support at support@docketalarm.com.
Sealed Document
We are unable to display this document, it may be under a court ordered seal.
If you have proper credentials to access the file, you may proceed directly to the court's system using your government issued username and password.
Access Government Site
