IPR2021-00831
`U.S. Patent No. 8,671,132
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`MICROSOFT CORPORATION,
`Petitioner,
`
`v.
`
`DAEDALUS BLUE, LLC,
`Patent Owner.
`
`Case IPR2021-00831
`Patent No. 8,671,132
`
`PATENT OWNER’S PRELIMINARY SUR-REPLY
`
`PROTECTIVE ORDER MATERIAL
`
`
`U.S. Patent No. 8,671,132
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`MICROSOFT CORPORATION,
`Petitioner,
`
`v.
`
`DAEDALUS BLUE, LLC,
`Patent Owner.
`
`Case IPR2021-00831
`Patent No. 8,671,132
`
`PATENT OWNER’S PRELIMINARY SUR-REPLY
`
`PROTECTIVE ORDER MATERIAL
`
`
`
`TABLE OF CONTENTS
`
`IPR2021-00831
`U.S. Patent No. 8,671,132
`
`Page
`
`I.
`II.
`
`The Fintiv Factors Strongly Support Discretionary Denial ............................. 1
`The Board Should Credit Patent Owner’s Antedating Evidence .................... 5
`
`i
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`PROTECTIVE ORDER MATERIAL
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`
`
`IPR2021-00831
`U.S. Patent No. 8,671,132
`TABLE OF AUTHORITIES
`
`Page(s)
`
`Cases
`Allergan, Inc. v. Apotex Inc.,
`754 F.3d 952 (Fed. Cir. 2014) ................................................................................ 7
`Chegg, Inc. v. Netsoc, LLC,
`IPR2019-01171, Paper 39 (PTAB Dec. 2, 2020) .................................................. 7
`Freebit AS v Bose Corp.,
`IPR2017-01307, Paper 8 (PTAB Nov. 14, 2017) ..............................................7, 8
`In re Steed,
`802 F.2d 1311 (Fed. Cir. 2015) .............................................................................. 7
`Juniper Networks v. WSOU Invest., LLC,
`IPR2021-00538, Paper 9 (PTAB Aug. 18, 2021) ........................................ passim
`Keyme LLC v. The Hillman Group, Inc.,
`IPR2020-01028, Paper 12 (PTAB Jan. 13, 2021) .................................................. 4
`Nvidia Corp. v. Invensas Corp.,
`IPR2020-00603, Paper 11 (PTAB Sept. 3, 2020) .................................................. 4
`Perfect Surgical Techniques, Inc. v. Olympus Am., Inc.,
`841 F.3d 1004 (Fed. Cir. 2016) ..........................................................................6, 7
`Sotera Wireless, Inc. v. Masimo Corp.,
`IPR2020-01019, Paper 12 (PTAB Dec. 1, 2020) .................................................. 4
`Tech. Licensing Corp. v. Videotek, Inc.,
`545 F.3d 1316 (Fed. Cir. 2008) .............................................................................. 8
`TransWeb, LLC v. 3M Innovative Properties Co.,
`812 F.3d 1295 (Fed. Cir. 2016) .............................................................................. 8
`Statutes
`35 U.S.C. §314(a) ...................................................................................................... 1
`35 U.S.C. §315(e)(2) .................................................................................................. 4
`
`ii
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`PROTECTIVE ORDER MATERIAL
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`
`
`EX2001
`EX2002
`
`EX2003
`
`EX2004
`
`EX2005
`
`EX2006
`
`EX2007
`
`EX2008
`
`EX2009
`
`EX2010
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`EX2011
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`EX2012
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`IPR2021-00831
`U.S. Patent No. 8,671,132
`
`Patent Owner’s Exhibit List
`Declaration of Professor Jules White, Ph.D.
`Declaration of David Pease, Ph.D.
`PROTECTIVE ORDER MATERIAL
`Declaration of Linda Duyanovich
`PROTECTIVE ORDER MATERIAL
`Order Governing Proceedings, Daedalus Blue, LLC v.
`Microsoft Corporation, Case No. 6:20-CV-1152-ADA, Dkt.
`No. 23 (W.D. Tex. June 30, 2021)
`Microsoft Corporation’s Notice of Filing Petitions for Inter
`Partes Review, Daedalus Blue, LLC v. Microsoft
`Corporation, Case No. 6:20-cv-1152-ADA, Dkt. No. 19
`(W.D. Tex. May 7, 2021)
`Defendant’s Invalidity Contentions, Daedalus Blue, LLC v.
`Microsoft Corporation, Case No. 6:20-cv-1152-ADA
`Chart C-1 from Defendant’s Invalidity Contentions, Daedalus
`Blue, LLC v. Microsoft Corporation, Case No. 6:20-cv-1152-
`ADA
`Chart C-2 from Defendant’s Invalidity Contentions, Daedalus
`Blue, LLC v. Microsoft Corporation, Case No. 6:20-cv-1152-
`ADA
`Chart C-6 from Defendant’s Invalidity Contentions, Daedalus
`Blue, LLC v. Microsoft Corporation, Case No. 6:20-cv-1152-
`ADA
`Chart C-7 from Defendant’s Invalidity Contentions, Daedalus
`Blue, LLC v. Microsoft Corporation, Case No. 6:20-cv-1152-
`ADA
`Microsoft Computer Dictionary, Fifth Edition, Definition for
`‘main frame,’ 2002
`IBM, Storage Tank, Initial Programming Functional
`Specifications, Version 1.1, dated April 26, 2001
`PROTECTIVE ORDER MATERIAL
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`iii
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`PROTECTIVE ORDER MATERIAL
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`
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`IPR2021-00831
`U.S. Patent No. 8,671,132
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`Patent Owner’s Exhibit List
`IBM, Storage Tank, Initial Programming Functional
`Specifications, Version 1.2, dated June 11, 2001
`PROTECTIVE ORDER MATERIAL
`IBM, IBM Storage Tank: Storage Tank Strategy, Product
`Positioning, dated September 17, 2001
`PROTECTIVE ORDER MATERIAL
`IBM, Storage Tank: Development Review, dated February 11,
`2002
`PROTECTIVE ORDER MATERIAL
`IBM, “Storage Tank: Release 1: High Level Design,” Version
`Draft 0,” dated February 19, 2002
`PROTECTIVE ORDER MATERIAL
`IBM, Storage Tank Development Schedule, dated February
`2002.
`PROTECTIVE ORDER MATERIAL
`Defendant’s Revised Proposed Claim Constructions,
`Daedalus Blue, LLC v. Microsoft Corporation, Case No.
`6:20-cv-1152-ADA, dated August 11, 2021
`Defendant’s Disclosure of Extrinsic Evidence, Daedalus
`Blue, LLC v. Microsoft Corporation, Case No. 6:20-cv-1152-
`ADA, dated August 3, 2021
`U.S. Patent No. 6,154,776 to Martin “Martin”
`U.S. Patent No. 6,167,445 to Gai “Gai”
`U.S. Patent No. 6,212,562 to Huang “Huang”
`Declaration of Michael Flynn-O’Brien
`
`EX2013
`
`EX2014
`
`EX2015
`
`EX2016
`
`EX2017
`
`EX2018
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`EX2019
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`EX2020
`EX2021
`EX2022
`EX2023
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`iv
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`PROTECTIVE ORDER MATERIAL
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`
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`I.
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`IPR2021-00831
`U.S. Patent No. 8,671,132
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`The Fintiv factors strongly support discretionary denial
`Denial under §314(a) is warranted: a stay is very unlikely, trial is set before
`
`the projected statutory deadline for a final written decision, Markman briefing and
`
`hearing will be completed prior to the statutory institution date, there is complete
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`overlap of parties and issues (uncured by Petitioner’s proposed stipulation), and
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`potential waste and inconsistency also favor denial.
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`First, a stay is very unlikely. Unlike Juniper, Petitioner here chose to
`
`challenge only three of five asserted patents, and has already told the court it does
`
`not intend to challenge others. EX2005. Petitioner’s characterizing the lack of a
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`stay as speculative is belied by those facts. Nor is this case like Juniper, where
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`Petitioner stated that it would seek a stay, a motion to transfer to the Northern
`
`District of California was pending, and neither party had identified any statements
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`or other evidence that addressed a stay for the parallel litigation. Juniper Networks
`
`v. WSOU Invest., LLC, IPR2021-00538, Paper 9 (PTAB Aug. 18, 2021)
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`(“Juniper”), at 8. Here, Patent Owner identified Petitioner’s statement to the court
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`that it would not challenge two of the five asserted patents. POPR, 47; EX2005.
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`Petitioner has not stated that it will request a stay, and there is no pending motion
`
`to transfer that could affect stay likelihood or timing.
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`Second, trial is scheduled to occur before the projected final written decision
`
`date. The November 14, 2022 trial date is not “estimated” and Petitioner’s
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`PROTECTIVE ORDER MATERIAL
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`IPR2021-00831
`U.S. Patent No. 8,671,132
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`speculation regarding Judge Albright’s docket are unavailing. The Petition was
`
`filed on May 7, 2021. On June 30, Judge Albright entered a scheduling order
`
`identifying November 14, 2022 as the trial date (EX2004), and the case docket
`
`explicitly reflects that Jury Trial is set for November 14, 2022 at 9 a.m. Petitioner’s
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`reliance on Juniper is again misaligned with the facts here. There, “neither party
`
`ha[d] submitted a Scheduling Order providing a specific trial date,” the court had
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`merely provided an “estimated trial date” via email, and the challenged patent may
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`not have been part of that trial given the judge’s practice. Juniper, 9-10.
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`Third, the district court will have invested substantial resources on
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`overlapping issues before the institution decision is due. Markman briefing is near
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`completion, and the Markman hearing will be held on October 18, over a month
`
`before the Board’s statutory institution decision deadline. And while Petitioner did
`
`not propose any terms for construction in its Petition, it has proposed construction
`
`in the district court for a term related to a key element addressed in the POPR, and
`
`its arguments there are inconsistent with its Petition arguments, including
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`conflicting evidence from its expert Dr. Zadok. Specifically, Petitioner argues that
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`the specification does not provide support for communicating with clients of
`
`different or varying computer platforms. EX2018, 4. In other words, Petitioner is
`
`asking the district court to determine that the ’132 Patent specification does not
`
`provide sufficient disclosure to a POSITA for language similar to that which
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`2
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`PROTECTIVE ORDER MATERIAL
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`IPR2021-00831
`U.S. Patent No. 8,671,132
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`Petitioner argues Devarakonda (which provides less detail than the ’132) discloses
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`in an anticipation theory. Petition, 49-52; POPR, 40-43. In contrast, in Juniper,
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`“much of the invested effort [was] unconnected to the patentability challenges.”
`
`Juniper, 11.
`
`Fourth, there is substantial overlap and potential for conflict between the
`
`proceedings here and in the district court that is not cured by Petitioner’s proffered
`
`stipulation (Reply, 3), which has not been filed with the district court. Petitioner’s
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`prior art invalidity contentions have already been served and rely heavily on
`
`Petitioner’s IPR references, Devarakonda, Gelb, and Tivoli, including in
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`combination with each other, or in combination with another patent or printed
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`publication. EX2006, 70-73. Notably, this includes a Gelb publication in addition
`
`to the Gelb patent relied on in the IPR. Id. Based on the contentions it has served in
`
`the district court, even under its “same grounds” stipulation, Petitioner could
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`merely add one additional ancillary reference to, shift focus to different limitations
`
`between, or shift between versions of, its IPR references. As a result, Petitioner’s
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`offer of a stipulation in which it “will not assert the same grounds” in the district
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`court is effectively meaningless to mitigate potential overlap and conflict. The
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`district court and Board could and would still be simultaneously addressing the
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`applicability of Devarakonda, Gelb, and Tivoli to the challenged claims.
`
`The proposed stipulation falls far short of the stipulation in the Board’s
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`3
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`PROTECTIVE ORDER MATERIAL
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`IPR2021-00831
`U.S. Patent No. 8,671,132
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`precedential Sotera case, and does nothing to “mitigate[] any concerns of
`
`duplicative efforts between the district court and the Board” or “concerns of
`
`potentially conflicting decisions.” Sotera Wireless, Inc. v. Masimo Corp.,
`
`IPR2020-01019, Paper 12 (PTAB Dec. 1, 2020) (precedential), at 19; see also id.,
`
`13-14, 18-19; see also, e.g., Keyme LLC v. The Hillman Group, Inc., IPR2020-
`
`01028, Paper 12 (PTAB Jan. 13, 2021), at 13-15. Petitioner could have offered a
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`Sotera stipulation co-extensive with §315(e)(2) estoppel, but chose not to do so.
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`And Petitioner’s proposal does not even rise to the level of the Juniper stipulation.
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`There, Petitioner offered a stipulation referencing §315(e)(2) estoppel that was
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`limited by other conditions, and the Board was set to reach a decision before the
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`district court. Thus the Board weighted the Juniper stipulation only “marginally in
`
`favor of not exercising discretion to deny.” Juniper, 13. If the Juniper stipulation
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`was only of “marginal[]” weight, the stipulation here should be given no weight.
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`Fifth, Petitioner’s cited Nvidia case has relevant facts not present here. In
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`Nvidia, the Board stated, “[a]s we explain above, however, we are likely to reach
`
`the merits at or around the same time as the district court case,” weighing “slightly
`
`against discretionary denial.” Nvidia Corp. v. Invensas Corp., IPR2020-00603,
`
`Paper 11 (PTAB Sept. 3, 2020) (“Nvidia”), at 23. “[A]bove,” the Board had noted
`
`that a final written decision would be due over two weeks prior to the trial, Patent
`
`Owner had moved to add new entities to the parallel litigation, trial faced potential
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`4
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`PROTECTIVE ORDER MATERIAL
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`IPR2021-00831
`U.S. Patent No. 8,671,132
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`COVID delays, and the court had already expressed willingness to stay following
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`institution. Nvidia, 16-19. Here, Petitioner also relies on Juniper and argues that
`
`institution is favored, but Juniper held that a lack of clarity about which
`
`proceeding would conclude first is neutral. Juniper, 16. In Juniper, no trial date
`
`was set and neither party submitted a scheduling order. Juniper recognized that if
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`trial precedes a final written decision (as here), denial is favored. Id.
`
`Sixth, Petitioner’s statement that the “POPR fails to dispute the vast majority
`
`of Petitioner’s invalidity arguments” is incorrect. The POPR addressed key
`
`elements required by every challenged claim for anticipation and obviousness (e.g.,
`
`POPR, 23-26, 40-43, EX2001, ¶¶44, 46-53), and that a POSITA would not have
`
`combined Gelb and Tivoli (e.g., POPR, 26-39; EX2001, ¶¶28-43). Petitioner also
`
`ignores the import of the antedating issue for factor 6, including waste of resources
`
`and risk of inconsistency in parallel forums on a fact-specific inquiry that here
`
`requires extensive third-party discovery. POPR, 54-57.
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`II.
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`The Board should credit Patent Owner’s antedating evidence
`Petitioner’s Reply does not contend that Dr. Pease and Ms. Duyanovich’s
`
`statements are inaccurate or challenge the veracity of the corroborating evidence.
`
`EX2002, EX2003, EX2012-EX2017. Petitioner also does not dispute Dr. Pease’s
`
`testimony mapping each limitation of the challenged claims to the April 2001
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`Storage Tank Specification (EX2002, ¶¶15-18), or that IBM released its Storage
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`5
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`PROTECTIVE ORDER MATERIAL
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`IPR2021-00831
`U.S. Patent No. 8,671,132
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`Tank product corresponding to that Specification in October 2003. Id. ¶¶8-13.
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`Petitioner disputes only whether Patent Owner’s evidence demonstrates
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`diligence through the patent filing date. But considered “‘as a whole’ under a rule
`
`of reason,” Patent Owner’s corroboration evidence sufficiently demonstrates
`
`reasonable diligence and that the challenged claims antedate Devarakonda,
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`Petitioner’s sole anticipation reference.1 See Perfect Surgical Techniques, Inc. v.
`
`Olympus Am., Inc., 841 F.3d 1004, 1007-08 (Fed. Cir. 2016) (“the point of the
`
`diligence analysis is . . . to assure that, in light of the evidence as a whole, the
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`invention was not abandoned or unreasonably delayed”).
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`Patent Owner provided undisputed evidence that the ’132 Patent grew out of
`
`a large product development undertaking by IBM. EX2002, ¶¶8-10; EX2003, ¶¶7-
`
`9, 11-13. Patent Owner’s corroborating evidence includes a forward-looking
`
`specification for that product dated April 26, 2001. EX2012. Patent Owner’s
`
`additional corroborating documents—from June 2001, September 2001, February
`
`1 Petitioner argues that its Tivoli exhibit, as §102(b) art, may not be antedated.
`
`Assuming Petitioner can show EX1006 was published and publicly accessible (see
`
`POPR, 23 n.4), Patent Owner agrees. But even so, Patent Owner also explained
`
`that a POSITA would not have combined Gelb and Tivoli and that both references
`
`lack key elements. E.g., POPR, 26-39; EX2001, ¶¶28-43.
`
`
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`6
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`PROTECTIVE ORDER MATERIAL
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`
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`2002—comprising development reports and schedules, demonstrate that work
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`IPR2021-00831
`U.S. Patent No. 8,671,132
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`consistent with the specification was ongoing and would continue. EX2013-
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`EX2017. Dr. Pease and Ms. Duyanovich explained that work included “developing
`
`code, prototypes, and documentation, and testing and review.” EX2002, ¶¶19;
`
`EX2003, ¶13. The actual release of a commercial product in October 2003
`
`demonstrates that diligence continued through that date, including through the
`
`filing of the patent in March 2003. EX2002, ¶¶8-13, 25; POPR, 20-22, 39-40. No
`
`further corroboration is necessary. See Perfect Surgical, 841 F.3d at 1010
`
`(“corroboration is particularly unnecessary when . . . the record indisputably shows
`
`that activities must have occurred during the relevant timeframe”); see also Freebit
`
`AS v Bose Corp., IPR2017-01307, Paper 8 (PTAB Nov. 14, 2017), at 28-32
`
`(denying institution where Patent Owner antedated a reference for two of three
`
`grounds, and Petitioner did not show motivation to combine for the third).
`
`Petitioner’s cases are inapposite. In re Steed, 802 F.2d 1311, 1319-20 (Fed.
`
`Cir. 2015) involved a pro se applicant with unintelligible corroborating evidence
`
`and documentary gap of five years. Chegg, Inc. v. Netsoc, LLC, IPR2019-01171,
`
`Paper 39 (PTAB Dec. 2, 2020), lacked corroborating evidence entirely. Allergan,
`
`Inc. v. Apotex Inc., 754 F.3d 952 (Fed. Cir. 2014), involved evidence unrelated to
`
`the “claimed invention,” unlike here. Compare EX1001, Figs. 1-2 with EX2012,
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`46, 69; EX2013, 41, 60; EX2014, 8-9; EX2015, 13-14; EX2016, 5; EX2017. Nor
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`7
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`PROTECTIVE ORDER MATERIAL
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`does Allergan require, as Petitioner suggests, mapping the “claimed features” to
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`IPR2021-00831
`U.S. Patent No. 8,671,132
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`each piece of corroborating evidence. The Federal Circuit has “repeatedly rejected
`
`an element-wise attack on corroboration of oral testimony.” TransWeb, LLC v. 3M
`
`Innovative Properties Co., 812 F.3d 1295, 1302 (Fed. Cir. 2016).
`
`Patent Owner’s evidence is, at a minimum, sufficient to shift the burden of
`
`production to Petitioner. Freebit, at 16-17, 28-32 (citing Tech. Licensing Corp. v.
`
`Videotek, Inc., 545 F.3d 1316, 1327-29 (Fed. Cir. 2008)). But Petitioner has
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`advanced no evidence showing a lack of reasonable diligence by the IBM
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`inventors. Id. at 16-17 & n.16. Nor is there a reasonable likelihood that Petitioner
`
`would be able to do so. IBM is a long-established, highly-reputable technology
`
`company that devoted a large number of people and resources to developing the
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`Storage Tank product from 2001 to 2003. EX2002 ¶¶8-10, 25; EX2003 ¶¶7-9, 11-
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`13, 22; EX2012, at 5; EX2015, at 3-4. As noted in the POPR, these issues will
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`necessarily be the subject of third-party discovery in the litigation. POPR, 55-56.
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`Dated: September 24, 2021
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`
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`
`
`/s/ Lauren N. Robinson
`Lauren N. Robinson, Lead Counsel
`Reg. No. 74,404
`Brenda Entzminger, Back-up Counsel
`Reg. No. 76,896
`Bunsow De Mory LLP
`701 El Camino Real
`Redwood City, CA 94063
`Telephone: 650-351-7248
`lrobinson@bdiplaw.com
`Counsel for Patent Owner
`
`
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`IPR2021-00831
`U.S. Patent No. 8,671,132
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`CERTIFICATE OF SERVICE
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`Petitioner has consented to e-mail service in this proceeding. Pursuant to 37
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`C.F.R. §42.6, the undersigned certifies that on September 24, 2021, a copy of the
`
`foregoing document was served by email upon the following counsel at the below
`
`email addresses:
`
`Don Daybell
`Registration No. 50,877
`(D2DPTABDocket@orrick.com)
`Postal & Hand-Delivery Address:
`Orrick, Herrington & Sutcliffe LLP
`2050 Main Street, Suite 1100
`Irvine, CA 92614-8255
`T: 949-567-6700; F: 949-567-6710
`
`Jared Bobrow
`Pro Hac Vice to be submitted
`(PTABDocketJ3B3@orrick.com)
`Postal & Hand-Delivery Address:
`Orrick, Herrington & Sutcliffe LLP
`1000 Marsh Road
`Menlo Park, CA 94025-1015
`T: 650-614-7400; F: 650-614-7401
`
`D2DPTABDocket@orrick.com
`PTABDocketJ3B3@orrick.com
`Microsoft-Daedalus_OHS_Only@orrick.com
`
`
`
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`IPR2021-00831
`U.S. Patent No. 8,671,132
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`/s/ Lauren N. Robinson
`Lauren N. Robinson
`Reg. No. 74,404
`Bunsow De Mory LLP
`701 El Camino Real
`Redwood City, CA 94063
`Telephone: 650-351-7248
`Facsimile: 415-426-4744
`lrobinson@bdiplaw.com
`
`Lead Counsel for Patent Owner
`
`
`
`Dated: September 24, 2021
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`PROTECTIVE ORDER MATERIAL
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