`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
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`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
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`APPLE INC.,
`Petitioner,
`
`v.
`
`KOSS CORPORATION,
`Patent Owner.
`_____________________
`
`CASE: IPR2021-00693
`U.S. PATENT NO. 10,469,934
`_____________________
`
`
`PATENT OWNER’S PRELIMINARY RESPONSE
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`IPR2021-00693
`Patent Owner’s Preliminary Response
`
`TABLE OF CONTENTS
`
`I. 
`II. 
`
`C. 
`
`INTRODUCTION ........................................................................................... 1 
`BACKGROUND ............................................................................................. 5 
`A. 
`The ’934 Patent ..................................................................................... 5 
`B. 
`Related Proceedings .............................................................................. 6 
`III.  THE BOARD SHOULD DENY INSTITUTION BECAUSE OF CO-
`PENDING LITIGATION INVOLVING THE ’934 PATENT ....................... 8 
`A. 
`Factor 1: The District Court Has Not Issued a Stay ............................. 9 
`B. 
`Factor 2: Proximity of the Scheduled Trial Date to the Board’s
`Statutory Deadline for Written Decision ............................................. 12 
`Factor 3: The Parties and Court Will Have Invested Substantial
`Resources in the Texas Litigation Prior to the Institution
`Decision ............................................................................................... 15 
`Factor 4: The Issues Raised in the Petition Overlap
`Substantially with Issues Raised in the Texas Litigation .................... 17 
`Factor 5: Petitioner is a Defendant in the Texas Litigation ............... 21 
`Factor 6: Other Considerations That Influence the Board’s
`Exercise of Discretion Weigh in Favor of Denying Institution .......... 22 
`G.  Holistic Assessment of Fintiv Factors ................................................. 23 
`IV.  THE PETITION SHOULD BE DENIED DISCRETIONARILY
`UNDER GENERAL PLASTIC ....................................................................... 25 
`A. 
`Factor 1: Whether the Same Petitioner Previously Filed a
`Petition Directed to the Same Claims of the Same Patent .................. 27 
`Factor 2: Whether at the Time of Filing of the First Petition the
`Petitioner Knew of the Prior Art Asserted in the Second
`Petition or Should Have Known of It .................................................. 28 
`
`D. 
`
`E. 
`F. 
`
`B. 
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`IPR2021-00693
`Patent Owner’s Preliminary Response
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`C. 
`
`D. 
`
`E. 
`
`Factor 3: Whether at the Time of Filing of the Second Petition
`the Petitioner Already Received the Patent Owner’s Preliminary
`Response to the First Petition or Received the Board’s Decision
`on Whether to Institute Review of the First Petition .......................... 30 
`Factor 4: The Length of Time that Elapsed Between the Time
`the Petitioner Learned of the Prior Art Asserted in the Second
`Petition and the Filing of the Second Petition ..................................... 31 
`Factor 5: Whether the Petitioner Provides Adequate
`Explanation for the Time Elapsed Between the Filings of
`Multiple Petitions Directed to the Same Claims of the Same
`Patent ................................................................................................... 32 
`Factors 6 and 7: The Finite Resources of the Board, and the
`Requirement to Issue a Final Determination Not Later Than
`One Year After the Date on Which the Director Notices
`Institution of Review ........................................................................... 33 
`THE PETITION FAILS TO SHOW THAT THERE IS
`REASONABLE LIKELIHOOD THAT PETITIONER WILL
`PREVAIL ON A SINGLE CLAIM .............................................................. 35 
`A. 
`The Petition Fails to Show that the Proposed Combinations
`Satisfy “the processor is configured to, upon activation of a
`user-control of the headphone assembly, initiate transmission of
`a request to a remote, network-connected server that is in
`wireless communication with the mobile, digital audio player” ......... 36 
`The Petition Fails to Show that the Proposed Combinations
`Satisfy “a rechargeable battery for powering the headphone
`assembly” ............................................................................................ 40 
`VI.  CONCLUSION .............................................................................................. 44 
`
`
`V. 
`
`F. 
`
`B. 
`
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`IPR2021-00693
`Patent Owner’s Preliminary Response
`
`TABLE OF AUTHORITIES
`
` Page(s)
`
`Cases
`Advanced Display Systems, Inc. v. Kent State Univ.,
`212 F.3d 1272 (Fed. Cir. 2000) .......................................................................... 29
`Apple Inc. v. Corephotonics Ltd.,
`IPR2018-01356, Paper 9 (PTAB Feb. 5, 2019) ............................................ 31, 32
`Apple Inc. v. Fintiv, Inc.,
`IPR2020-00019, Paper 11 (PTAB March 20, 2020) ...................................passim
`Apple Inc. v. Koss Corp.,
`IPR2021-00255, Paper 22 (PTAB June 3, 2021) ........................................passim
`Apple Inc. v. Koss Corp.,
`IPR2021-00305, Paper 14 (PTAB June 3, 2021) .......................................passim
`Apple Inc. v. Koss Corp.,
`IPR2021-00381, Paper 15 (PTAB July 2, 2021) .........................................passim
`Arendi S.A.R.L. v. Apple Inc.,
`832 F.3d 1355 (Fed. Cir. 2016) .................................................................... 42, 43
`B/E Aerospace, Inc. v. C&D Zodiac, Inc.,
`962 F.3d 1373 (Fed. Cir. 2020) .......................................................................... 42
`Cisco Sys., Inc. v. Monarch Networking Sols. LLC,
`IPR2020-01226, Paper 11, 15 (PTAB Mar. 4, 2021) ......................................... 21
`Cisco Sys., Inc. v. Ramot at Tel Aviv Univ. Ltd,
`IPR2020-00122, Paper 15 (PTAB May 15, 2020) ............................................. 13
`Club Champion LLC v. True Spec Golf LLC,
`IPR2019-01569, Paper 9 (PTAB March 17, 2020) ...................................... 33, 34
`General Plastic Indus. Co. v. Canon Kabushiki Kaisha,
`IPR2016-01357, Paper 19 (PTAB Sept. 6, 2017) ........................................passim
`
`iii
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`IPR2021-00693
`Patent Owner’s Preliminary Response
`
`Goggle LLC v. Realtime Adaptive Streaming, LLC,
`IPR2018-01342, Paper 47 (PTAB Feb. 27, 2020) .............................................. 33
`Google LLC v. Personalized Media Commc’ns, LLC,
`IPR2020-00724, Paper 19 (PTAB Aug. 31, 2020) ............................................... 9
`Guest-Tek Interactive Entertainment Ltd. v. Nomadix, Inc.,
`IPR2018-01668, Paper 6 (PTAB April 16, 2019) .............................................. 32
`Harmonic Inc. v. Avid Tech.,
`815 F.3d 1356 (Fed. Cir. 2016) ............................................................................ 8
`Intel Corp. v. VLSI Tech. LLC,
`IPR2019-01192, Paper 15 (PTAB Jan. 9, 2020) .................................................. 8
`K/S Himpp v. Hear-Wear Techs., LLC,
`751 F.3d 1362 (Fed. Cir. 2014) .......................................................................... 42
`MediaTek Inc. v. Nippon Tel. and Tel. Corp.,
`IPR2020-01607, Paper 12 (PTAB April 2, 2021) ................................................ 9
`Metall Zug AG v. Carl Zeiss Meditec AG,
`IPR2020-01074, Paper 8 (PTAB Jan. 5, 2021) .................................................. 28
`In re Mouttet,
`686 F.3d 1322 (Fed. Cir. 2012) .......................................................................... 20
`NHK Spring Co. v. Intri-Plex Techs., Inc.,
`IPR2018-00752, Paper 8 (PTAB Sept. 12, 2018) ................................................. 2
`Perfect Web Techs., Inc. v. InfoUSA, Inc.,
`587 F.3d 1324 (Fed. Cir. 2009) .................................................................... 43, 44
`In re Rijckaet,
`9 F.3d 1531 (Fed. Cir. 1993) .............................................................................. 43
`Samsung Elecs. Co., Ltd. v. Ancora Techs., Inc.,
`IPR2020-01184, Paper 11 (PTAB Jan. 5, 2021) ...................................... 9, 21, 22
`
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`Sand Revolution II, LLC v. Continental Intermodal Grp. Trucking
`LLC,
`IPR2019-01393, Paper 24 (PTAB June 16, 2020) ......................................... 9, 10
`Seko S.p.A. v. CM2W JSC,
`Case IPR2020-01636, Paper 9 (PTAB January 7, 2021) ................................... 34
`SK Hynix v. Netlist,
`IPR2020-01421, Paper 10 (PTAB Mar. 16, 2021) ............................................. 15
`SK Innovation Co. v. LG Chem, Ltd.,
`IPR2020-01240, Paper 15 (PTAB Jan. 12, 2021) .............................................. 13
`Sotera Wireless, Inc. v. Masimo Corp.,
`IPR2020-01019, Paper 12 (PTAB Dec. 1, 2020) ............................................... 21
`Supercell OY v. Gree, Inc.,
`IPR2020-00310, Paper 13 (PTAB Jun. 18, 2020) .............................................. 13
`Ultradent Prods., Inc. v. Life–Like Cosmetics, Inc.,
`127 F.3d 1065 (Fed.Cir.1997) ............................................................................ 29
`Verizon Bus. Network Servs. LLC v. Huawei Techs. Co.,
`IPR2020-01292, Paper 13 (PTAB Jan. 25, 2021) .................................. 15, 16, 22
`Verizon Bus. Network Svs., LLC v. Huawei Tech. Co.,
`IPR2020-01278, Paper 12 (PTAB Jan. 26, 2021) .............................................. 21
`Statutes
`35 U.S.C. § 314 .................................................................................................passim
`35 U.S.C. § 315 ........................................................................................................ 33
`35 U.S.C. § 316 .................................................................................................... 8, 12
`Other Authorities
`37 C.F.R. § 42.24 ..................................................................................................... 32
`37 C.F.R. § 42.107 ..................................................................................................... 1
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`IPR2021-00693
`Patent Owner’s Preliminary Response
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`37 C.F.R. § 42.108 ..................................................................................................... 8
`37 C.F.R. § 42.122 ................................................................................................... 33
`84 Fed. Reg. 33,925 at 26 (July 16, 2019) ............................................................... 25
`MPEP § 2163.07(b).................................................................................................. 29
`TRIAL PRACTICE GUIDE CONSOLIDATED at 36 (July 2019) ...................................... 43
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`IPR2021-00693
`Patent Owner’s Preliminary Response
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`EXHIBIT LISTING
`
`Description
`Exhibit
`KOSS-2001 Docket Report, Koss Corp. v. Apple Inc., Case No. 6:20-cv-00665-
`ADA (W.D. Tex.) (as of July 14, 2021)
`
`KOSS-2002
`
`Joint Claim Construction Statement, Koss Corp. v. Apple Inc., Case
`No. 6:20-cv-00665-ADA, Dkt. 68 (W.D. Tex. April 14, 2021)
`
`KOSS-2003 Claim Construction Order, Koss Corp. v. Apple Inc., Case No.
`6:20-cv-00665-ADA, Dkt. 83 (W.D. Tex. June 2, 2021)
`
`KOSS-2004
`
`Joint Motion to Amend Agreed Scheduling Order, Koss Corp. v.
`Apple Inc., Case No. 6:20-cv-00665-ADA, Dkt. 85 (W.D. Tex.
`June 15, 2021)
`
`KOSS-2005 Order Denying Defendant’s Motion to Transfer, Koss Corp. v.
`Apple Inc., Case No. 6:20-cv-00665-ADA, Dkt. 76 (W.D. Tex.
`April 22, 2021)
`
`KOSS-2006 Docket Report, Apple Inc. v. Koss Corp., Case No. 4:20-cv-
`05504-JST (N.D. Cal.) (as of July 15, 2021)
`
`KOSS-2007 Order Granting Motion to Transfer, Apple Inc. v. Koss Corp.,
`Case No. 4:20-cv-05504-JST, Dkt. 72 (N.D. Cal May 12, 2021)
`
`KOSS-2008 Joint Motion to Consolidate Cases, Koss Corp. v. Apple Inc., Case
`No. 6:20-cv-00665-ADA, Dkt. 84 (W.D. Tex. June 8, 2021)
`
`KOSS-2009 R. Davis, “Albright Says He’ll Very Rarely Put Cases on Hold for
`PTAB,” Law360, May 11, 2021
`(www.law360.com/articles/1381597/print?section=ip) (accessed
`July 9, 2021)
`
`KOSS-2010 Order Denying Motion to Stay, Kerr Machine Co. v. Vulcan
`Indus. Holdings, LLC et al., Case No. 6-20-cv-00200-ADA (W.D.
`Tex. Apr. 7, 2021)
`
`vii
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`IPR2021-00693
`Patent Owner’s Preliminary Response
`
`Description
`Exhibit
`KOSS-2011 Order Governing Proceedings - Patent Case, Judge Albright
`(W.D. Tex. Feb. 23, 2021)
`
`KOSS-2012 U.S. Pub. No. 2008/0194209 A1 to Haupt et al. (“Haupt-209”)
`
`KOSS-2013 Defendant Apple Inc.’s Invalidity Contentions, Koss Corp. v.
`Apple Inc., Case No. 6:20-cv-0066-ADA, Jan. 15, 2021 (W.D.
`Tex.)
`
`KOSS-2014 Petition, Apple Inc. v. Koss Corp., IPR2021-00255, November 25,
`2020
`
`KOSS-2015 Petition, Apple Inc. v. Koss Corp., IPR2021-00600, March 7, 2021
`
`KOSS-2016 S. Carlson et al., “Tallying Repetitive Inter Partes Review
`Challenges,”
`Law360,
`Sept.
`14,
`2018
`(www.law360.com/articles/1083158/tallying-repetitive-inter-
`partes-review-challenges) (accessed July 15, 2021)
`
`KOSS-2017 Exhibit A2 to Defendant Apple Inc.’s Invalidity Contentions, Koss
`Corp. v. Apple Inc., Case No. 6:20-cv-0066-ADA, Jan. 15, 2021
`(W.D. Tex.)
`
`
`
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`I.
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`IPR2021-00693
`Patent Owner Preliminary Response
`
`INTRODUCTION
`Patent Owner, Koss Corporation (“Koss”), submits this Patent Owner
`
`Preliminary Response (“POPR”) pursuant to 37 C.F.R. § 42.107(a) to the Inter
`
`Partes Review (“IPR”) petition (“Petition”) filed by Apple Inc. (“Petitioner”) for
`
`claims 1-6, 8, 10-20, 22-29, 31-36, 38-42, 44 and 58-62 (“Challenged Claims”) of
`
`U.S. Patent No. 10,469,934 (“’934 Patent,” APPLE-1001).
`
`This is Petitioner’s second IPR petition (“Second Petition”) for the ’934 Patent
`
`following IPR2021-00592, filed March 2, 2021 (“First Petition”). Both petitions
`
`rely on exactly the same references, Haupt (APPLE-1004), Seshadri (APPLE-1007,
`
`referred to herein as “Seshadri-716”), Paulson (APPLE-1011), Rao (APPLE-1000),
`
`and Rosener (APPLE-1008). However, the Second Petition also relies on an
`
`allegedly “additional reference,” Seshadri-818 (APPLE-1013), to challenge the
`
`“signal strength claims” that were not challenged in the First Petition. Pet. at 68.
`
`Seshadri-818, however, is neither “additional” nor “new” relative to the First
`
`Petition because Seshadri-716 incorporates Seshadri-818 and because the Second
`
`Petition does not even rely on Seshadri-818 as a “Basis for Rejection” in its asserted
`
`grounds in the Second Petition. Pet. at 1-2.
`
`The Board should deny institution for several reasons.
`
`First, institution of the IPR would demand an untimely and inefficient
`
`proceeding that would effectively “second guess” the result of a jury trial in
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`concurrent litigation. See NHK Spring Co. v. Intri-Plex Techs., Inc., IPR2018-
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`IPR2021-00693
`Patent Owner Preliminary Response
`
`00752, Paper 8 at 11–21 (PTAB Sept. 12, 2018) (Precedential); Apple Inc. v. Fintiv,
`
`Inc., IPR2020-00019, Paper 11 at 2–3 (PTAB March 20, 2020) (Precedential).
`
`Patent Owner is asserting the ’934 Patent against Petitioner in co-pending litigation
`
`in the Western District of Texas (“WDTX”). Koss Corp. v. Apple Inc., Case No.
`
`6:20-cv-00665-ADA (W.D. Tex.) (“Texas Litigation”). KOSS-2001; KOSS-2002;
`
`KOSS-2003. The trial in the Texas Litigation is scheduled (and recently confirmed)
`
`to commence in April 2022 (APPLE-1016, 4; KOSS-2001, 14 (see Dkt. 72); KOSS-
`
`2004, 8) six months before an expected final written decision (“FWD”) if the IPR is
`
`instituted, resulting in a substantial risk of conflicting decisions regarding the
`
`validity of the ’934 Patent.
`
`Second, the Petition should be denied under General Plastic Indus. Co. v.
`
`Canon Kabushiki Kaisha, IPR2016-01357, Paper 19 (PTAB Sept. 6, 2017)
`
`(precedential) (hereinafter, “General Plastic”). Petitioner has filed two petitions,
`
`three weeks apart, against the ’934 Patent and the references relied upon for the
`
`asserted grounds in each petition are identical. Compare First Petition (IPR2021-
`
`00592) at 1-2 to Second Petition (IPR2021-00693) at 1-2. Indeed, several
`
`combinations of references asserted in the Second Petition are identical to
`
`combinations in the First Petition (combinations for Grounds 1C-1F in Second
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`- 2 -
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`Petition identical to combinations for Grounds 1A-1D in First Petition). Id.
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`IPR2021-00693
`Patent Owner Preliminary Response
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`Additionally, Petitioner’s two IPRs for the ’934 Patent challenge many of the same
`
`claims (twenty-one challenged claims are the same in both petitions).
`
`Petitioner’s purported justification for the delay in filing the Second Petition
`
`is mere pretext. Petitioner’s stated reason is that the Second Petition “advances an
`
`additional reference (Seshadri-818 [APPLE-1013]), in conjunction with the prior art
`
`from [the First Petition], with the intent of demonstrating the unpatentability of
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`[certain] dependent claims ….” Pet. at 68. However, Seshadri-818 is neither new
`
`nor additional relative to the First Petition because Seshadri-818 is incorporated into
`
`Seshadri-716 (APPLE-1007), which is relied on for every ground asserted in the
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`First Petition. See Petition, IPR2021-00592, at 1-2; APPLE-1007, ¶[0001]
`
`(incorporating by reference Serial No. 10/856,430, which is Seshadri-818); Pet. at
`
`28-29 (admitting the Seshadri-818 is incorporated into Seshadri-716). Thus, from
`
`reading Seshadri-716, which is used in the First Petition for every asserted invalidity
`
`ground, Petitioner knew of, or should have known of, Seshadri-818. Still further,
`
`the Second Petition does not even rely on Seshadri-818 as a “basis for rejection” for
`
`the Challenged Claims in the Second Petition. Pet. at 1-2 (“Basis for Rejection”
`
`column). Thus, Petitioner is requesting the Board to expend duplicative resources
`
`to assess the validity of many of the same claims of the ’934 Patent on substantially
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`similar grounds. The Board should, accordingly, deny institution under 35 U.S.C.
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`IPR2021-00693
`Patent Owner Preliminary Response
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`§ 314(a) to mitigate duplicative work and the risk of conflicting decisions.
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`Finally, the Board should deny institution under 35 U.S.C. § 314(a) because
`
`the Petition fails to show that there is a reasonable likelihood that Petitioner will
`
`prevail on at least one challenged claim. Claims 1 and 58 are the only independent
`
`claims of the ’934 Patent. The Petition asserts that claim 58 would have been
`
`obvious over a two-reference combination of Haupt (APPLE-1004) and Seshadri-
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`716 (APPLE-1007). It asserts that claim 1 would have been obvious over a three-
`
`reference combination of Haupt, Seshadri-716 and Rao (APPLE-1009). The
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`Petition, however, fails to show that several elements of independent claims 1 and
`
`58 are present or otherwise suggested by the asserted combinations. In fact,
`
`Petitioner recognized that the asserted combinations do not show one claim element
`
`in particular in the independent claims and instead tried to plug the hole in its
`
`analysis with an additional reference, Hankey (APPLE-1005), without ever setting
`
`forth a ground of unpatentability that includes Hankey, including failing to identify
`
`any motivation to combine the multiple references or performing any Graham-factor
`
`analysis involving Hankey.
`
`These reasons are independent and the Board can deny institution for any of
`
`these reasons.
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`IPR2021-00693
`Patent Owner Preliminary Response
`
`
`II. BACKGROUND
`A. The ’934 Patent
`The ’934 Patent includes sixty-two (62) claims; claims 1 and 58 are
`
`independent. Claim 1 recites a headphone assembly that comprises first and second
`
`earphones, an antenna for receiving wireless signals from a mobile, digital audio
`
`player via one or more ad hoc wireless communication links, a wireless
`
`communication circuit for receiving and transmitting wireless signals to and from
`
`the headphone assembly, a processor, a memory for storing firmware executed by
`
`the processor, a rechargeable battery, and a microphone. The processor is
`
`configured to, upon activation of a user-control of the headphone assembly, initiate
`
`transmission of a request to a remote, network-connected server. The headphone
`
`assembly is further for receiving firmware updates transmitted from the remote,
`
`network-connected server. APPLE-1001, 18:1-32.
`
`Claim 58 is similar to claim 1, except that instead of reciting that the
`
`headphone assembly receives firmware updates, claim 58 recites that “the
`
`headphone assembly transitions to play digital audio content received wirelessly
`
`from a second digital audio source via a second wireless communication link based
`
`on, at least, a signal strength level for the second wireless communication link,
`
`wherein the second digital audio source is different from the first digital audio
`
`source.” Id., 24:61-67.
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`IPR2021-00693
`Patent Owner Preliminary Response
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`The Petition challenges forty three claims under six total grounds, Grounds
`
`1(A)–1(F), which allege that the Challenged Claims would have been obvious over
`
`various combinations of Haupt, Seshadri-716, Rao, Paulson, and Rosener. Pet. at 1-
`
`2.
`
`B. Related Proceedings
`Patent Owner is asserting the ’934 Patent, along with four other patents,
`
`against Petitioner in the Texas Litigation. KOSS-2001; KOSS-2002; KOSS-2003;
`
`APPLE-1014. Petitioner filed two IPRs for each of the five patents asserted against
`
`Petitioner in the Texas Litigation. IPR2021-00255; IPR2021-00305; IPR2021-
`
`00381; IPR2021-00546; IPR2021-00592 (Petitioner’s First Petition for the ’934
`
`Patent); IPR2021-00600; IPR2021-00626; IPR2021-00679; IPR2021-00686; and
`
`IPR2021-00693 (the Second Petition for the ’934 Patent and the subject of this
`
`POPR). The Board instituted the IPRs for IPR2021-00255 and IPR2021-000305 on
`
`June 3, 2021, and instituted the IPR for IPR2021-00381 on July 2, 2021. IPR2021-
`
`00255, Paper 22; IPR2021-00305, Paper 14; IPR2021-00381, Paper 15. The Board
`
`has not rendered institution decisions yet in the other IPRs.
`
`This petition, the “Second Petition,” is the second of two petitions filed by
`
`Petitioner against the ’934 Patent. The First Petition is IPR2021-00592, filed March
`
`2, 2021. Another party, Bose Corporation, also filed a petition against the ’934
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`Patent. See IPR2021-00680, filed March 17, 2021. The Board has not yet made
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`IPR2021-00693
`Patent Owner Preliminary Response
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`institution decisions on any of these three petitions for the ’934 Patent.
`
`The Texas Litigation is headed for trial in April 2022. APPLE-1016, 4;
`
`KOSS-2001, 14 (Dkt. 72) (“The Court has set the Jury Trial date of April 18, 2022”);
`
`KOSS-2004, 8. The district court already held a Markman hearing on April 23, 2021
`
`and issued the claim construction ruling on June 2, 2021. KOSS-2001, 13 (Dkt. 58),
`
`15 (Dkt. 72), 16 (Dkt. 83); KOSS-2003. The district court also denied Petitioner’s
`
`motion to transfer the Texas Litigation to the Northern District of California
`
`(“NDCal”). KOSS-2005.
`
`Petitioner filed a declaratory judgement action pertaining to the five asserted
`
`patents (including the ’934 Patent) in the NDCal. KOSS-2006. The district court in
`
`the NDCal granted Patent Owner’s motion to transfer the NDCal case to the WDTX.
`
`KOSS-2007. The litigants recently filed a motion in the WDTX to consolidate
`
`Patent Owner’s case and the declaratory judgment action before Judge Albright in
`
`the WDTX. KOSS-2008.
`
`Petitioner recently filed a petition for a writ of mandamus from the Federal
`
`Circuit directing the WDTX district court to transfer the Texas Litigation to the
`
`NDCal. See In re Apple, Case No. 21-147 (Fed. Cir.). The Federal Circuit has not
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`yet ruled on the petition.
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`IPR2021-00693
`Patent Owner Preliminary Response
`
`
`III. THE BOARD SHOULD DENY INSTITUTION BECAUSE OF CO-
`PENDING LITIGATION INVOLVING THE ’934 PATENT
`The Board “is permitted, but never compelled, to institute an IPR proceeding.”
`
`Harmonic Inc. v. Avid Tech., 815 F.3d 1356, 1367 (Fed. Cir. 2016); see also 35
`
`U.S.C. § 314(b) (“Director shall determine whether to institute an inter partes review
`
`….”); 37 C.F.R. § 42.108(c) (“Inter partes review shall not be instituted unless the
`
`Board decides that the information presented in the petition demonstrates that there
`
`is a reasonable likelihood that at least one of the claims challenged in the petition is
`
`unpatentable.”). The Board may apply this discretion in consideration of “the
`
`integrity of the patent system, [and] the efficient administration of the Office ….”
`
`35 U.S.C. § 316(b). The Board has denied institution “to minimize the duplication
`
`of work by two tribunals to resolve the same issue.” Intel Corp. v. VLSI Tech. LLC,
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`IPR2019-01192, Paper 15 at 11 (PTAB Jan. 9, 2020).
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`In Fintiv, the Board outlined six factors that inform its decision “to deny
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`institution in view of an earlier trial date in [a] parallel proceeding.” IPR2020-
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`00019, Paper 11 at 6. The Board weighs and considers the holistic effect of each of
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`the following factors: (1) whether the court granted a stay or evidence exists that one
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`may be granted if a proceeding is instituted; (2) proximity of the court’s trial date to
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`the Board’s projected statutory deadline for a final written decision; (3) investment
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`in the parallel proceeding by the court and the parties; (4) overlap between issues
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`raised in the petition and in the parallel proceeding; (5) whether the petitioner and
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`IPR2021-00693
`Patent Owner Preliminary Response
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`the defendant in the parallel proceeding are the same party; and (6) other
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`circumstances that impact the Board’s exercise of discretion, including the merits
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`(collectively, “Fintiv factors”). Id. at 5–15.
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`The Fintiv factors collectively justify denial of the Petition because the ’934
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`Patent is being asserted presently against Petitioner in the Texas Litigation. Denying
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`institution of the IPR is consistent with recent Board decisions, preserves the
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`integrity of the patent system, promotes the efficient administration of Office
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`resources, and minimizes duplicative work by two different tribunals. See id.;
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`Samsung Elecs. Co., Ltd. v. Ancora Techs., Inc., IPR2020-01184, Paper 11 at 18
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`(PTAB Jan. 5, 2021); Google LLC v. Personalized Media Commc’ns, LLC,
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`IPR2020-00724, Paper 19 at 6, 11 (PTAB Aug. 31, 2020).
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`A.
`Factor 1: The District Court Has Not Issued a Stay
`When a Petitioner represents it will move to stay a district court lawsuit if
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`institution is granted, the first Fintiv factor should be viewed as neutral. See Sand
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`Revolution II, LLC v. Continental Intermodal Grp. Trucking LLC, IPR2019-01393,
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`Paper 24 at 7 (PTAB June 16, 2020); MediaTek Inc. v. Nippon Tel. and Tel. Corp.,
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`IPR2020-01607, Paper 12 at 12 (PTAB April 2, 2021) (“Petitioner represents it will
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`move to stay the District Court Lawsuit if institution is granted but does not know
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`how the District Court will rule … [t]hus, this factor should be viewed as neutral.”).
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`Petitioner did not represent that it will move to stay the Texas Litigation if
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`institution is granted, and instead merely characterizes a potential stay of the Texas
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`Litigation as “appropriate.” Pet. at 70. As of the filing of this POPR, the Board
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`instituted IPRs for three other patents involved in the Texas Litigation, yet Petitioner
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`has not moved to stay the Texas Litigation in light of those institutions. See Apple
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`Inc. v. Koss Corp., IPR2021-00255, Paper 22 (PTAB June 3, 2021) (for U.S. Patent
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`10,298,451); Apple Inc. v. Koss Corp., IPR2021-00305, Paper 14 (PTAB June 3,
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`2021) (for U.S. Patent 10,506,325); Apple Inc. v. Koss Corp., IPR2021-00381, Paper
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`15 (PTAB July 2, 2021); KOSS-2002, 2 (identifying patents in Texas Litigation).
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`Although the Board “will not attempt to predict how the district court in the
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`related district court litigation will proceed because the court may determine whether
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`or not to stay any individual case,” Sand Revolution, IPR2019-01393, Paper 24, 7,
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`here, such a prediction is not necessary. Petitioner has not expressed an intention to
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`stay the Texas Litigation. Absent an affirmative representation to move to stay the
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`Texas Litigation, the first Fintiv factor weighs in favor of denying institution or,
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`alternatively, should be viewed as merely neutral.
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`Moreover, it is highly unlikely that the presiding judge, Judge Albright, in the
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`Texas Litigation would grant such a motion. During his two and a half years on the
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`bench, Judge Albright, by his own admission, has only put “one or two” cases on
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`hold so that the Board can review the patent at issue, absent a joint motion to stay.
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`KOSS-2009. Judge Albright has explained that he granted those “one or two”
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`motions to stay because the plaintiff had earlier sued other defendants on the same
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`patent in a different district and those other defendants had their petitions instituted,
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`such that IPRs were well underway by the time patent owner filed the later
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`complaints in the Western District of Texas. Id. These circumstances are not present
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`in the Texas Litigation.
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`In the Texas Litigation, claim construction is complete and fact discovery has
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`commenced (APPLE-1016, 3; KOSS-2004, 6-7), which, according to Judge
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`Albright, indicates that the Texas Litigation is in a later stage and warrants the
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`preservation of a trial date in spite of institution. KOSS-2010 (Judge Albright
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`denying motion to transfer). In other words, Petitioner has not represented that it
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`intends to move to stay the Texas Litigation if institution is granted, and even if
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`Petitioner moves to stay, it is highly unlikely that Judge Albright will grant such a
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`motion.
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`Accordingly, the first Fintiv factor, therefore, weighs in favor of discretionary
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`denial of institution or, at a minimum, should be viewed merely as neutral.
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`B.
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`Factor 2: Proximity of the Scheduled Trial Date to the Board’s
`Statutory Deadline for Written Decision
`The institution decision will issue by October 15, 2021. 35 U.S.C.
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`§ 314(b)(1). If instituted, the FWD will issue by October 15, 2022. 35 U.S.C.
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`§ 316(a)(11). The trial in the Texas Litigation, however, is scheduled to start April
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`18, 2022 (APPLE-1016, 4; KOSS-2001, 14 (Dkt. 72); KOSS-2004, 8), six months
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`prior to the FWD if the IPR is instituted.
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`“The proximity inquiry is a proxy for the likelihood that the trial court will
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`reach a decision on validity issues before the Board reaches a final written decision.”
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`Apple Inc. v Koss Corporation, IPR2021-00255, Paper 22 at 12 (evaluating a three-
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`month gap between trial and expected FWD). In the two of the recent institution
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`decisions involving Petitioner, Patent Owner, and two patents that are also involved
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`in the Texas Litigation, the Board found that a less than two-month gap between the
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`trial and the expected FWD “at most minimally weighs in favor of invoking our
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`discretion to deny institution” and, ultimately, did not deny institution under Fintiv.
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`IPR2021-00255, Paper 22 at 12; IPR2021-00305, Paper 14 at 13-14; see also
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`IPR2021-00381, Paper 15 at 14 (three month gap “weighs slightly towards
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`exercising discretion …”). The facts have changed, however, with respect to the
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`present Petition such that the Board’s analysis in those two institution decisions is
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`less applicable to the present Petition for two major reasons.
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`First, the gap between the trial and the expected FWD date is approximately
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`six months for this Petition, significantly larger than the gap considered by the Board
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`in IPR2021-00255, IPR2021-00305 and IPR2021-00381. A six-month gap favors
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`Patent Owner. See Cisco Sys., Inc. v. Ramot at Tel Aviv Univ. Ltd, IPR2020-00122,
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`Paper 15 at 7-8 (PTAB May 15, 2020); SK Innovation Co. v. LG Chem, Ltd.,
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`IPR2020-01240, Paper 15 at 16-17 (PTAB Jan. 12, 2021); Supercell OY v. Gree,
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`Inc., IPR2020-00310, Paper 13 at 10-12 (PTAB Jun. 18, 2020).
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`Second, the likelihood of the trial taking place in April 2022 is greater now in
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`light of recent events, including:
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`1) The District Court’s Minute Entry from the Markman hearing, held
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`April 23, 2021, confirmed that the “Court has set the Jury Trial date of April 18,
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`2022.” KOSS-2001, 14 (Dkt. 72). This statement by the Court corresponds to the
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`trial date s