Trials@uspto.gov
`571-272-7822
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`Paper 11
`Entered: June 16, 2021
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`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`MICROSOFT CORPORATION,
`Petitioner,
`
`v.
`
`WORLDS INC.,
`Patent Owner.
`____________
`
`IPR2021-00277
`Patent 8,082,501 B2
`____________
`
`
`
`Before MELISSA A. HAAPALA, Senior Lead Administrative Patent Judge,
`KARL D. EASTHOM, and KEN B. BARRETT, Administrative Patent
`Judges.
`
`BARRETT, Administrative Patent Judge.
`
`
`
`
`DECISION
`Granting Institution of Inter Partes Review
`35 U.S.C. § 314
`
`

`

`IPR2021-00277
`Patent 8,082,501 B2
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`
`I.
`
`INTRODUCTION
`
`A. Background and Summary
`
`
`
`Microsoft Corporation (“Petitioner”) filed a Petition requesting inter
`
`partes review of U.S. Patent No. 8,082,501 B2 (“the ’501 patent,”
`
`Ex. 1001). Paper 2 (“Pet.”). The Petition challenges the patentability of
`
`claims 1–8, 10, 12, and 14–16 of the ’501 patent. Worlds Inc. (“Patent
`
`Owner”) filed a Preliminary Response to the Petition. Paper 6 (“Prelim.
`
`Resp.”). With prior authorization, Petitioner filed a Reply (Paper 7, “Pet.
`
`Reply”) and Patent Owner filed a Sur-reply (Paper 8, “PO Sur-reply”).
`
`Patent Owner subsequently filed updated mandatory notices and
`
`corresponding exhibits regarding pertinent events in the parallel district
`
`court proceedings. See Papers 9, 10; Exs. 2100, 2101.
`
`
`
`An inter partes review may not be instituted “unless . . . the
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`information presented in the petition . . . 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.” 35 U.S.C. § 314(a) (2018). Having
`
`considered the arguments and evidence presented by Petitioner and Patent
`
`Owner, we determine that Petitioner has demonstrated a reasonable
`
`likelihood of prevailing on at least one of the challenged claims of the ’501
`
`patent. Accordingly, we institute an inter partes review as to all the
`
`challenged claims of the ’501 patent on all the grounds of unpatentability set
`
`forth in the Petition.
`
`B. The Identified Real Parties-in-Interest
`
`
`
`Petitioner identifies “Microsoft Corporation, and Mojang AB, an
`
`indirect wholly owned subsidiary of Microsoft Corporation,” as the real
`
`parties-in-interest. Pet. 61. We address below Patent Owner’s contention
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`IPR2021-00277
`Patent 8,082,501 B2
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`that Petitioner improperly failed to identify a time-barred entity as a real
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`party-in-interest.
`
`
`
`Patent Owner identifies Worlds Inc. as the real party-in-interest.
`
`Paper 4, 2.
`
`C. Related Proceedings
`
`
`
`One or both parties identify, as matters involving or related to the
`
`’501 patent, Worlds Inc. v. Microsoft Corporation, 6:20-cv-872 (W.D. Tex.
`
`2020) (“the Texas Action”) and Worlds Inc. v. Activision Blizzard, Inc.,
`
`Blizzard Entertainment, Inc., and Activision Publishing, Inc., 1:12-cv-10576
`
`(D. Mass. 2012) (“the Massachusetts Action”), and Patent Trial and Appeal
`
`Board case IPR2015-01319 (“the Prior IPR”). Pet. 61; Papers 4, 9. We
`
`additionally note that the Prior IPR was the subject of an appeal. See Worlds
`
`Inc. v. Bungie, Inc., 903 F.3d 1237 (Fed. Cir. 2018) (“Worlds”).
`
`D. The ’501 Patent
`
`
`
`The ’501 patent discloses a “client-server architecture” for a
`
`“graphical, multi-user, interactive virtual world system.” Ex. 1001, code
`
`(57), 3:6–8. In the preferred embodiment, each user chooses an avatar to
`
`“represent the user in the virtual world,” id. at 3:25–27, and “interacts with a
`
`client system,” which “is networked to a virtual world server,” id. at 3:14–
`
`15. “[E]ach client . . . sends its current location, or changes in its current
`
`location, to the server.” Id. at 3:40–44; see id. at 2:44–47. The server, in
`
`turn, sends each client “updated position information” for neighbors of the
`
`client’s user. Id. at code (57), 2:44–49, 3:40–44, 14:28–32.
`
`
`
`The client executes a process to render a “view” of the virtual world
`
`“from the perspective of the avatar for that . . . user.” Id. at code (57), 2:40–
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`IPR2021-00277
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`42, 3:30–35, 4:54–56, 7:55–57. This view shows “avatars representing the
`
`other users who are neighbors of the user.” Id. at code (57), 2:42–44.
`
`E. Illustrative Claim
`
`
`
`Of the challenged claims of the ’501 patent, claims 1, 12, and 14 are
`
`independent claims. The remaining challenged claims depend directly or
`
`indirectly from claim 1 or claim 14. Claim 1, reproduced below, is
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`illustrative.
`
`1. A method for enabling a first user to interact with other
`users in a virtual space, each user of the first user and the other
`users being associated with a three dimensional avatar
`representing said each user in the virtual space, the method
`comprising the steps of:
`
`customizing, using a processor of a client device, an
`avatar in response to input by the first user;
`
`receiving, by the client device, position information
`associated with fewer than all of the other user avatars in an
`interaction room of the virtual space, from a server process,
`wherein the client device does not receive position information
`of at least some avatars that fail to satisfy a participant
`condition imposed on avatars displayable on a client device
`display of the client device;
`
`determining, by the client device, a displayable set of the
`other user avatars associated with the client device display; and
`
`displaying, on the client device display, the displayable
`set of the other user avatars associated with the client device
`display.
`
`Ex. 1001, 19:21–38.
`
`4
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`

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`IPR2021-00277
`Patent 8,082,501 B2
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`
`
`Petitioner relies on the following references:
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`F. Evidence
`
`Reference
`
`Thomas A. Funkhouser, RING: A Client-Server System for Multi-
`User Virtual Environments, in 1995 SYMPOSIUM ON INTERACTIVE
`3D GRAPHICS 85, 85–92, 209 (1995) (“Funkhouser”)
`
`US 5,659,691; Filed Sept. 23, 1993; Issued Aug. 19, 1997
`(“Durward”)
`
`US 4,521,014; Filed Sept. 30, 1982; Issued June 4, 1985
`(“Sitrick”)
`
`Thomas A. Funkhouser & Carlo H. Séquin, Adaptive Display
`Algorithm for Interactive Frame Rates During Visualization of
`Complex Virtual Environments, in COMPUTER GRAPHICS
`PROCEEDINGS: ANNUAL CONFERENCE SERIES 247, 247–254
`(1993). (“Funkhouser ’93”)
`
`Exhibit
`No.
`
`1005
`
`1008
`
`1013
`
`1017
`
`US 5,021,976; Filed Nov. 14, 1988; Issued June 4, 1991
`(“Wexelblat”)
`
`1020
`
`
`
`Petitioner also relies on the declarations of Dr. Michael Zyda
`
`(Exs. 1002, 1033, 1034) in support of its arguments. The parties rely on
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`other exhibits as discussed below.
`
`G. Asserted Grounds of Unpatentability
`
`
`
`Petitioner asserts that the challenged claims are unpatentable on the
`
`following grounds:
`
`Claim(s) Challenged 35 U.S.C. §
`
`Reference(s)/Basis
`
`1–6, 12, 14, 15
`
`103(a)
`
`Funkhouser, Sitrick
`
`7, 16
`
`8, 10
`
`103(a)
`
`Funkhouser, Sitrick, Wexelblat
`
`103(a)
`
`Funkhouser, Sitrick, Funkhouser ’93
`
`1–6, 12, 14, 15
`
`103(a)
`
`Funkhouser, Sitrick, Durward
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`5
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`Patent 8,082,501 B2
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`Claim(s) Challenged 35 U.S.C. §
`
`Reference(s)/Basis
`
`7, 16
`
`8, 10
`
`103(a)
`
`103(a)
`
`Funkhouser, Sitrick, Durward,
`Wexelblat
`
`Funkhouser, Sitrick, Durward,
`Funkhouser ’93
`
`II. PROCEDURAL BACKGROUND
`
`A. The Massachusetts Action Involving Activision
`
`
`
`Prior-petitioner Bungie, Inc. and non-petitioner Activision Publishing,
`
`Inc. entered into a Software Publishing and Development Agreement (“the
`
`Agreement”), effective April 16, 2010. Ex. 2001, 1. Under the Agreement,
`
`Bungie “agreed to develop” a series of software products with the title
`
`Destiny (“the Destiny Products”), “to be exclusively published and
`
`distributed by Activision.” Id. In the Agreement, Bungie is identified as the
`
`Licensor. Bungie’s obligations under the Agreement include the obligation
`
`to conduct “legal reviews of the Products to ensure that all Intellectual
`
`Property and other rights are fully cleared for use.” Id. at 10 (Recital
`
`7A.15(j)). The responsibilities of Bungie listed in Recital 7A.15 of the
`
`Agreement, including the “legal reviews,” are “subject to prior review and
`
`approval of Activision, (budget to [be] mutually approved).” Id. (Recital
`
`7A.15).
`
`
`
`In 2012, Patent Owner Worlds filed and served a complaint against
`
`Activision and later, but still in 2012, an amended complaint, with those
`
`complaints alleging infringement of the ’501 patent in the United States
`
`District Court for the District of Massachusetts. Ex. 1023 (original
`
`complaint); Ex. 2003 (certificate of service); Ex. 1022 (amended complaint).
`
`As amended, the complaint alleged infringement by Activision’s World of
`
`Warcraft—but not any of Bungie’s Destiny Products. See Ex. 1022, 4–5. In
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`the Prior IPR, Bungie and Worlds stipulated that Bungie is not a party to the
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`Massachusetts Action. See Ex. 1024, 9 (Termination (Paper 62)).
`
`
`
`Patent Owner sent to Activision a letter dated November 13, 2014
`
`(“the Letter”), over one year after service of the complaint on Activision.
`
`Ex. 1025, 10. In the Letter, Patent Owner informed Activision that Patent
`
`Owner “intend[s] to add . . . Destiny” to the Activision Litigation. Id. As of
`
`the conclusion of the Prior IPR, Patent Owner had not added any of the
`
`Destiny Products as an accused product in the Massachusetts Action. Id.
`
`During the Prior IPR, Patent Owner argued that the Letter triggered the
`
`requirement that Bungie fulfill its contractual responsibilities owed to
`
`Activision and that that resulted in the filing of the prior petition. Ex. 1025,
`
`28.
`
`
`
`Patent Owner sought RPI-related discovery of Activision in the
`
`Massachusetts Action, and Activision, in response, sought a protective order.
`
`See Ex. 2004, 1. The Massachusetts Court proposed that Activision make a
`
`concession that would moot the need for the discovery, and stated that it
`
`would assume Activision assents to the concession if no timely objection
`
`was made. See id. at 4. Patent Owner represents that no such objection was
`
`made. Prelim. Resp. 7. That concession reads as follows:
`
`Activision Blizzard, Inc., Blizzard Entertainment, Inc., and
`Activision Publishing, Inc., admit for purposes of the present
`action that they were real-parties-in-interest to the inter partes
`review petitions filed in May and June of 2015 by Bungie, Inc.,
`concerning patents held by Worlds Inc.
`
`Ex. 2004, 7.
`
`
`
`On April 30, 2021, the Massachusetts Court issued a Memorandum
`
`and Order granting summary judgment of invalidity. Ex. 2100. The Court
`
`held that all the asserted claims of the ’501 patent, claims 1–8, 10, 12, and
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`14–16 (the same claims challenged in this inter partes review) are invalid
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`under 35 U.S.C. §101. Id. at 1–2, 19. We understand Patent Owner to have
`
`indicated that it has appealed or intends to appeal the summary judgment
`
`order and final judgment in the Massachusetts Action. See Ex. 2101 (order
`
`granting a stay in the Texas Action pending an appeal).
`
`B. The Prior Inter Partes Review, Appeal, and Remand
`
`
`
`Bungie filed its IPR petition challenging claims 1–8, 10, 12, and 14–
`
`16 of the ’501 patent on June 1, 2015, and a few months after Patent
`
`Owner’s November 2014 letter indicating its intent to add, as an allegedly
`
`infringing product in the Massachusetts Action, Bungie’s Destiny product.
`
`See Ex. 1028. The Board, unpersuaded by Patent Owner’s RPI arguments,
`
`instituted an inter partes review. See Prelim. Resp. 5. At the conclusion of
`
`the trial, the Board issued a Final Written Decision, determining that
`
`challenged claims 1–8, 10, 12, and 14–16 of the ’501 patent are unpatentable
`
`as obvious under 35 U.S.C. §103. Ex. 1024, 63. Patent Owner appealed the
`
`decision, arguing that the petition was time-barred because the alleged RPI,
`
`Activision, had been served with a complaint more than one year prior to the
`
`filing dates of the petition. Worlds, 903 F.3d at 1240. Patent Owner also
`
`appealed the merits of the Board’s obviousness analysis. Id.
`
`
`
`On September 7, 2018, the United States Court of Appeals for the
`
`Federal Circuit issued a decision vacating the Board’s final written decision.
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`Worlds, 903 F.3d at 1248. The Court concluded that the Board erred in its
`
`real party-in-interest analysis. Id. at 1239. The Court noted that, “[i]n its
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`decisions to institute, the Board rejected Worlds’s argument [that Bungie
`
`should have named Activision as an RPI], concluding that ‘Patent Owner
`
`has not demonstrated that Activision is an unnamed real party in interest in
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`this proceeding.’” Id. at 1240. The Court held that an IPR petitioner—not
`
`the patent owner—bears the ultimate burden of persuasion to demonstrate
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`that a petition is not time barred under § 315(b). Worlds, 903 F.3d at 1242.
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`The Federal Circuit determined that Patent Owner presented evidence—the
`
`Agreement, the Letter, and the fact that Bungie challenged the same five
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`patents asserted against Activision—“sufficient to put Bungie’s
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`identification of itself as the sole real party in interest into dispute.” Id.
`
`at 1244, 1246. The Federal Circuit did not reach the merits of the
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`patentability challenge. Id. at 1248.
`
`
`
`On January 14, 2020, and upon remand from the Federal Circuit, the
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`Board issued a decision in the Prior IPR. Ex. 1025. The Board determined
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`“that Petitioner Bungie ha[d] not met its burden to show that the Petitions
`
`were not time-barred under 35 U.S.C. § 315(b).” Id. at 4. In light of the
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`burden framework, the Board stated, for example:
`
`We agree with Petitioner that Patent Owner’s theories
`
`regarding the Agreement largely are based on speculation. See
`Pet. Reply on Remand 6–8 (containing at least eight
`occurrences of some form of the word “speculate”). However,
`it was incumbent upon Petitioner to provide persuasive
`argument supported by evidence to reduce or remove any
`speculation. Petitioner bears the ultimate burden to
`demonstrate that its Petitions are not time-barred based on a
`complaint served on alleged RPI Activision more than one year
`prior to the filing of the Petitions.
`
`Id. at 38. The Board found that Bungie and Activision “had a preexisting,
`
`established relationship related to the challenged patents,” and that
`
`Activision was a clear beneficiary of the petition filing, desired review of the
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`patent, and would benefit if the patent were held unpatentable. Id. at 45. In
`
`light of those findings and due to the lack of evidence from Bungie, the
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`Board “determine[d] that Petitioner has not met its burden of persuasion to
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`show that its Petitions are not time-barred under § 315(b).” Id. The Board
`
`dismissed the petition, vacated the decision to institute, and terminated the
`
`inter partes review. Id. at 45–46.
`
`C. The Texas Action Involving Microsoft, and the Current Petition for Inter
`Partes Review
`
`
`
`In September 2020, Patent Owner Worlds filed a complaint for
`
`infringement of the ’501 patent against Petitioner Microsoft in the United
`
`States District Court for the Western District of Texas, and served Petitioner.
`
`Ex. 1021; Ex. 1037, 4. Patent Owner identified Minecraft as the accused
`
`product, and alleged that Microsoft’s products and services “infringe at least
`
`method claims 1, 2, 5, and 10 of the ’501 Patent.” Ex. 1021, 2; see also id.
`
`at 24.
`
`
`
`On December 3, 2020, Microsoft filed the present Petition. The
`
`Petition states:
`
`This petition advances a subset of the same grounds
`
`that were previously presented and finally decided in
`IPR2015-01319. EX-1024. Specifically, this petition advances
`the grounds based on Funkhouser, Sitrick, Wexelblat, and
`Funkhouser ’93 that were fully briefed, orally argued, and
`finally decided on the merits in a final written decision that
`found each of the Challenged Claims unpatentable, and this
`petition does so adopting the claim constructions applied in that
`earlier decision. See generally EX-1024.
`
`Pet. 1. On the same day that the Petition was filed, Petitioner sent a letter to
`
`Patent Owner stating
`
`Microsoft Corporation hereby stipulates that, unless the Patent
`Trial and Appeal Board (PTAB) denies or later vacates
`institution of the IPR petition, Microsoft Corporation will not
`seek resolution in the trial for the above-captioned litigation
`of invalidity based on the grounds presented in the IPR
`
`10
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`petition . . . or grounds that would otherwise be estopped under
`35 U.S.C. § 315(e) under a later final written decision.
`
`Ex. 1041, 1.
`
`
`
`On December 21, 2020, Patent Owner served its preliminary
`
`infringement contentions on Petitioner, alleging “Microsoft’s direct
`
`infringement of at least claims 1, 2, 5, and 10 of the ‘501 patent.”
`
`Ex. 2006, 1.
`
`
`
`On May 12, 2021, the Texas Court granted the parties’ joint motion
`
`for a stay pending the appeal of the judgment in the Massachusetts Action.
`
`Ex. 2101.
`
`III. THE REAL-PARTY-IN-INTEREST ISSUE
`
`
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`Patent Owner argues that the Petition is time-barred under 35 U.S.C.
`
`§ 315(b) because of a time-barred real party-in-interest. Prelim. Resp. 3–14.
`
`A. Real-Party-in-Interest Law
`
`
`
`“An inter partes review may not be instituted if the petition requesting
`
`the proceeding is filed more than 1 year after the date on which the
`
`petitioner, real party in interest, or privy of the petitioner is served with a
`
`complaint alleging infringement of the patent.” 35 U.S.C. § 315(b).
`
`
`
`“[T]he IPR petitioner bears the ultimate burden of persuasion to show
`
`that its petitions are not time-barred under § 315(b) based on a complaint
`
`served on an alleged real party in interest more than a year earlier.” Worlds,
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`903 F.3d at 1242, quoted in RPX Corp. v. Applications in Internet Time,
`
`LLC, IPR2015-01750, Paper 128 at 6 (PTAB Oct. 2, 2020) (precedential)
`
`(“RPX”). This is, in part, because “an IPR petitioner will usually be in a
`
`better position, at least relative to the patent owner, to access evidence
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`relevant to the real-party-in-interest inquiry.” Worlds, 903 F.3d at 1242–43.
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`11
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`We generally accept a petitioner’s initial identification of the RPIs unless the
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`patent owner presents some evidence that tends to show that a particular
`
`unnamed party should be included as an RPI. Id. at 1241–42.
`
`[A] patent owner must produce some evidence that tends to
`show that a particular third party should be named a real party
`in interest.[] A mere assertion that a third party is an unnamed
`real party in interest, without any support for that assertion, is
`insufficient to put the issue into dispute.
`
`Id. at 1244 (footnote omitted). Where a patent owner presents evidence
`
`sufficient to put a petitioner’s identification of RPIs into dispute, we “make
`
`any factual determinations necessary to evaluate whether [the petitioner]
`
`ha[s] satisfied its burden to demonstrate that its petition was not time-barred
`
`based on the complaints served upon . . . the alleged real party in interest.”
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`Id. at 1246.
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`
`
`Determining whether a non-party is an RPI “demands a flexible
`
`approach that takes into account both equitable and practical considerations,
`
`with an eye toward determining whether the non-party is a clear beneficiary
`
`that has a preexisting, established relationship with the petitioner.”
`
`Applications in Internet Time, LLC v. RPX Corp., 897 F.3d 1336, 1351 (Fed.
`
`Cir. 2018) (“AIT”), quoted with approval in RPX, IPR2015-01750, Paper
`
`128, at 7–8; see RPX, IPR2015-01750, Paper 128, at 23 (quoting AIT, 897
`
`F.3d at 1348 (“[T]he focus of the real-party-in-interest inquiry is on the
`
`patentability of the claims challenged in the IPR petition, bearing in mind
`
`who will benefit from having those claims canceled or invalidated.”)). This
`
`is a fact-dependent inquiry where “the two questions lying at its heart are
`
`whether a non-party ‘desires review of the patent’ and whether a petition has
`
`been filed at a nonparty’s ‘behest.’” Id. at 1351 (citation omitted); see also
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`Patent Trial and Appeal Board, Consolidated Trial Practice Guide, 14 (Nov.
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`2019) (“Trial Practice Guide”), available at https://www.uspto.gov/
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`TrialPracticeGuideConsolidated.
`
`
`
`As an example, “a party that funds and directs and controls an IPR . . .
`
`petition or proceeding constitutes a ‘real party-in-interest,’ even if that party
`
`is not a ‘privy’ of the petitioner.” Trial Practice Guide 17. Other
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`considerations relevant to the RPI and privy inquiry include the following:
`
`whether the non-party had the opportunity to exercise control over the
`
`petitioner’s participation in the IPR; the non-party’s relationship with the
`
`petitioner and with the petition, including any involvement in the filing; and
`
`the nature of the entity filing the petition. Id. at 15–18; accord RPX,
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`IPR2015-01750, Paper 128, at 32. “The concept of control generally means
`
`that ‘it should be enough that the nonparty has the actual measure of control
`
`or opportunity to control that might reasonably be expected between two
`
`formal coparties.’” Trial Practice Guide 16 (citation omitted).
`
`
`
`Additionally, the Board has determined that an unnamed party, a
`
`customer of the petitioner, is an RPI under the circumstances where there is
`
`a both a direct benefit to the non-party and where the petitioner and the
`
`non-party had a pre-existing business relationship. Those circumstances
`
`were as follows:
`
`[where the non-party] would not receive a merely generalized
`benefit from [the petitioner’s] filing of the Petition, but rather,
`the direct benefit of a finding of unpatentability of claims of the
`[subject] patents for which [the patent owner] had accused [the
`non-party] of infringing[, and where] it is clear that [the
`petitioner] and [the non-party] had a specially structured,
`preexisting, and well established business relationship with one
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`another, including indemnification and exclusivity
`arrangements.
`
`Ventex Co., Ltd. v. Columbia Sportswear N. Am., Inc., IPR2017-00651,
`
`Paper 152 (the public version of Paper 148) at 10 (PTAB Jan. 24, 2019)
`
`(precedential).
`
`
`
`There may be more than one RPI, and a petitioner’s independent
`
`interest in pursuing an IPR does not preclude another entity from being an
`
`RPI. AIT, 897 F.3d at 1347, 1353. The court, in AIT, explained that
`
`[t]he point is not to probe [the petitioner’s] interest (it does not
`need any); rather, it is to probe the extent to which [the non-
`party] . . . has an interest in and will benefit from [the
`petitioner’s] actions, and inquire whether [the petitioner] can be
`said to be representing that interest after examining its
`relationship with [the non-party].
`
`Id. Thus, again, the RPI inquiry looks at any benefit to the non-party and at
`
`any relationship between the petitioner and the non-party.
`
`B. Discussion of the Real Party-In-Interest Issue
`
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`
`As mentioned above, we generally accept a petitioner’s initial
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`identification of the RPIs unless the patent owner presents some evidence
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`that tends to show that a particular unnamed party should be included as an
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`RPI. Worlds, 903 F.3d at 1241–42. Such evidence, to be adequate1 to place
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`the matter at issue, should address, for example, “whether the non-party is a
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`clear beneficiary that has a preexisting, established relationship with the
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`petitioner” and “whether a non-party desires review of the patent and
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`
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`1 In Worlds, the court suggested that a useful standard for the quantum of
`support required from a patent owner is “evidence that reasonably brings
`into question the accuracy of a petitioner’s identification of the real parties
`in interest.” Worlds, 903 F.3d at 1244 n.8 (internal quotation mark omitted).
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`whether a petition has been filed at a nonparty’s ‘behest.’” RPX,
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`IPR2015-01750, Paper 128, at 7–8 (internal quotations omitted).
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`
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`Patent Owner argues that Petitioner Microsoft, by asserting grounds
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`set forth in the Bungie petition, has tied itself to Bungie and, by extension to
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`Activision, who was served with a complaint more than one year prior to the
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`filing of the Bungie petition. See Prelim. Resp. 1–2 (“Microsoft does not
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`and cannot demonstrate that it cleansed the impact of the time-barred party’s
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`involvement from its Petition. To the contrary, Microsoft adopts the time-
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`barred party’s and time-barred petition’s work as if it were its own . . . .”);
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`id. at 9 (“In particular, Microsoft does not and cannot come forward with
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`evidence to disprove Activision’s hand in the substantive grounds first
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`asserted by Bungie and now reasserted in Microsoft’s Petition.”). Patent
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`Owner also argues that Activision is the party that will benefit from the
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`present Petition. See, e.g., id. at 11–14.
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`
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`Section 315(b) bars institution of an inter partes review where an RPI
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`of the petitioner was served with a complaint more than one year prior to the
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`filing of the petition. 35 U.S.C. § 315(b). Here, Patent Owner does not
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`assert that prior-petitioner Bungie was served with a complaint. Cf. Prelim.
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`Resp. 3–4 (Patent Owner only asserting that Activision was served). Thus,
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`even if Petitioner Microsoft’s use of arguments from the Prior IPR resulted
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`in Bungie being an RPI of Microsoft, Bungie would not be a “real party in
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`interest . . . served with a complaint alleging infringement of the patent”
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`under the time-bar provision of Section 315(b); cf., e.g., PO Sur-reply 2–3
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`(Patent Owner apparently, but ambiguously, referring to Bungie—not
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`Activision—in discussing the alleged relationship between the “time-barred
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`party” and Petitioner Microsoft). Activision is the entity that was served
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`with a complaint more than a year prior to Microsoft filing its petition.
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`Thus, it is any relationship between Activision and Microsoft that is most
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`important to our analysis.
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`
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`Patent Owner relies on the lack of evidence in arguing that Activision
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`had a hand in the filing of Bungie’s petition in the Prior IPR and, therefore,
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`is an RPI to Bungie. See, e.g., Prelim. Resp. 8–9. Specifically, Patent
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`Owner quotes from the Termination in the Prior IPR, where the Board
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`stated: “we cannot determine Activision’s involvement, if any, in the filing
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`of the [Bungie] Petitions.” Id. at 6 (quoting Ex. 1025, 35) (emphasis
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`omitted). Building on that premise, Patent Owner argues, “[t]hat lack of
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`evidence doomed Bungie’s petition, as Bungie could not disprove
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`Activision’s hand in its petition, and the lack of evidence dooms Microsoft’s
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`Petition for the same reason.” Id. at 11; see also id. at 9 (“The Board
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`terminated IPR2015-01319 due to its inability to determine Activision’s
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`involvement in the substance of Bungie’s petition. This Petition possesses
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`the same statutory defect, and is time-barred under 35 U.S.C. § 315(b).”).
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`To the extent that Activision’s alleged involvement in the Prior IPR is
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`relevant, Patent Owner cannot convert a lack of evidence into a basis to find
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`that Activision was involved in the filing of the prior petition.
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`
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`Although Activision, as another party being sued for infringement,
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`might have an interest in the filing of the present Petition, Patent Owner has
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`not identified adequate evidence of a preexisting relationship between
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`Petitioner Microsoft and Activision that might suggest that Microsoft can be
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`said to be representing Activision’s interests. See AIT, 897 F.3d at 1353
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`(“The point . . . is to probe the extent to which [alleged RPI] Salesforce—as
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`RPX’s client—has an interest in and will benefit from RPX’s actions, and
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`inquire whether RPX can be said to be representing that interest after
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`examining its relationship with Salesforce.”). Patent Owner argues that
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`“Microsoft is improperly advancing the interests of Bungie and Activision
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`by taking their preexisting Petition and refiling it to seek Board review.”
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`Prelim. Resp. 13. However, on the facts of this case, a “preexisting Petition”
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`does not equate to a preexisting relationship between the Petitioner
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`Microsoft and another entity within the meaning of RPI law. Further, Patent
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`Owner’s contention appears to be that the filing of the Petition is when the
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`purported relationship was formed, not that it was preexisting.
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`
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`Patent Owner argues that Microsoft must be acting to benefit
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`Activision because the Petition challenges all the claims asserted against
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`Activision in the Massachusetts Action, whereas “[i]n the litigation between
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`Patent Owner and Microsoft, Patent Owner is only asserting claims 1, 2, 5,
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`and 10 of the ’501 patent.” Prelim. Resp. 12 (emphasis added) (citing
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`Ex. 2005; Ex. 2006). First, the cited references—the complaint and
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`preliminary infringement contentions, respectively—both allege
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`infringement by “at least” those claims, thus contradicting Patent Owner’s
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`assertion that those are the “only” claims asserted. Ex. 2005, 2; Ex. 2006, 4.
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`Second, Petitioner notes that it filed the Petition relatively soon after the
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`filing of the complaint (and prior to receipt of the preliminary contentions)
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`and persuasively argues that “[i]t was reasonable for Microsoft to expect that
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`it could be accused of infringing all claims that were included in Bungie’s
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`petition.” Pet. Reply 5. In the Prior IPR, an important fact was that Bungie,
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`who had not been sued, filed petitions challenging the same five patents
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`asserted against Activision in the district court. See Worlds, 903 F.3d
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`at 1244. The present case presents different facts, not the least of which is
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`that Microsoft has been accused of infringing the patent that it now
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`challenges in the Petition. The fact that Microsoft, in using the arguments
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`from the Bungie petition, challenges the same claims as in that Bungie
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`petition does not indicate, as Patent Owner urges, that the Petition benefits
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`only Activision. See Prelim. Resp. 12 (heading: “In Replicating Bungie’s
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`Defective Petition, Microsoft Benefits Only Activision and Acquiesces to
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`Activision’s RPI Status”).
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`
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`Patent Owner argues that Petitioner has “acquiesced to the fate of
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`Bungie’s petition—denial due to the RPI status of Activision” by copying
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`the petition and relying on an expert declaration from the Prior IPR. Prelim.
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`Resp. 14; see also PO Sur-reply 3–4. Patent Owner provides a citation to
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`AIT, 897 F.3d at 1357, but does not explain adequately how AIT’s mention
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`of acquiescence applies to the facts of this case. Additionally, it appears that
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`Patent Owner’s argument is premised on the assumption that Activision had
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`a hand in Bungie’s petition notwithstanding Patent Owner’s recognition that
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`the Prior IPR was terminated because there was a lack of evidence regarding
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`Activision’s alleged involvement.2 See PO Sur-reply 3 (referring to
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`honoring a prior determination); Prelim. Resp. 9 (emphasizing with both
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`bold and italics that “the Board had no evidence to determine Activision’s
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`involvement, if any, in the filing of Bungie’s petitions.”). We do not find
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`that Petitioner Microsoft, by copying arguments from a prior petition or
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`
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`2 Patent Owner notes that Activision, in the Massachusetts Action conceded
`that it was an RPI of Bungie. Prelim. Resp. 7. That concession was made
`for purposes of that action only and is not binding on Microsoft or in this
`IPR. See Ex. 2004, 7.
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`using a prior declaration, has acquiesced to the status of Activision being an
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`RPI.
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`Even if Patent Owner had produced evidence adequate to place the
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`matter at issue, we find that Petitioner has satisfied its burden to show that
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`Activision is not a real party-in-interest. Petitioner submits declarations
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`where witnesses testify to the lack of a pertinent business relationship
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`between Microsoft, Bungie, and Activision. Ex. 1026; Ex. 1027. For
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`example, an Assistant General Counsel at Microsoft testifies:
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`After a reasonable investigation into Microsoft’s litigation
`activity related to