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`IPR2021-00832
`U.S. Patent No. 8,381,209
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`UNITED STATES PATENT AND TRADEMARK OFFICE
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`MICROSOFT CORPORATION,
`Petitioner,
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`v.
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`DAEDALUS BLUE, LLC,
`Patent Owner.
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`Case IPR2021-00832
`Patent No. 8,381,209
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`PATENT OWNER’S PRELIMINARY SUR-REPLY
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`IPR2021-00832
`U.S. Patent No. 8,381,209
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`TABLE OF CONTENTS
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`Page
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`The Fintiv Factors Strongly Support Discretionary Denial ............................. 1
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`I.
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`i
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`IPR2021-00832
`U.S. Patent No. 8,381,209
`TABLE OF AUTHORITIES
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`Page(s)
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`Cases
`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) .................................................. 5
`Sotera Wireless, Inc. v. Masimo Corp.,
`IPR2020-01019, Paper 12 (PTAB Dec. 1, 2020) .................................................. 4
`Statutes
`35 U.S.C. §314(a) ...................................................................................................... 1
`35 U.S.C. §315(e)(2) .................................................................................................. 4
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`ii
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`IPR2021-00832
`U.S. Patent No. 8,381,209
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`Patent Owner’s Exhibit List
`RESERVED
`RESERVED
`RESERVED
`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 D-1 from Defendant’s Invalidity Contentions,
`Daedalus Blue, LLC v. Microsoft Corporation, Case No.
`6:20-cv-1152-ADA
`Chart D-2 from Defendant’s Invalidity Contentions,
`Daedalus Blue, LLC v. Microsoft Corporation, Case No.
`6:20-cv-1152-ADA
`Chart D-5 from Defendant’s Invalidity Contentions,
`Daedalus Blue, LLC v. Microsoft Corporation, Case No.
`6:20-cv-1152-ADA
`Defendant’s Revised Proposed Claim Constructions,
`Daedalus Blue, LLC v. Microsoft Corporation, Case No.
`6:20-cv-1152-ADA, dated August 11, 2021
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`EX2001
`EX2002
`EX2003
`EX2004
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`EX2005
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`EX2006
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`EX2007
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`EX2008
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`EX2009
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`EX2010
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`iii
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`I.
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`IPR2021-00832
`U.S. Patent No. 8,381,209
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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
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`the projected statutory deadline for a final written decision, Markman briefing and
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`hearing will be complete prior to statutory institution date, there is complete
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`overlap parties and issues (uncured by Petitioner’s proposed stipulation), and the
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`merits, efficiency, and consistency also favor denial.
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`First, a stay is very unlikely. Unlike Juniper, Petitioner challenges only three
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`of five asserted patents, and told the court it does not intend to challenge others.
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`EX2005. Petitioner’s characterizing the lack of a stay as speculative is belied by
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`those facts. Nor is this case like Juniper, where Petitioner stated that it would seek
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`a stay, a motion to transfer to the Northern District of California was pending, and
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`neither party had identified any statements or other evidence that addressed a stay
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`for the parallel litigation. Juniper Networks v. WSOU Invest., LLC, IPR2021-
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`00538, Paper 9 (PTAB Aug. 18, 2021) (“Juniper”), at 8. Here, Patent Owner
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`identified Petitioner’s statement to the court that it would not challenge two of the
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`five asserted patents. POPR, 44; EX2005. Petitioner has not stated that it will
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`request a stay, and there is no pending motion to transfer that could affect stay
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`likelihood or timing.
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`Second, trial is scheduled to occur before the projected final written decision
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`date. The November 14, 2022 trial date is not “estimated” and Petitioner’s
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`speculation regarding Judge Albright’s docket are unavailing. The Petition was
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`IPR2021-00832
`U.S. Patent No. 8,381,209
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`filed on May 7, 2021. On June 30, Judge Albright entered a scheduling order
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`identifying November 14, 2022 as the trial date (EX2004), and the case docket
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`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
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`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. The Markman hearing will be held on October 18, over a month
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`before the Board’s statutory institution decision deadline for a decision regarding
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`institution. And while Petitioner did not propose any terms for construction in its
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`Petition, it has proposed construction in the district court for the key element
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`addressed in the POPR: “enforcing … routing at a hypervisor layer via dynamic
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`updating of routing controls.” EX2010, 4; e.g., POPR, 29-40. Petitioner ignores
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`that the claim construction issue for this key element required by every challenged
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`claim will already have been briefed and argued before the court, and that the
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`court’s conclusion may affect the application of the cited prior art for this term. In
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`contrast, in Juniper, “much of the invested effort [was] unconnected to the
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`2
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`patentability challenges.” Juniper, 11.
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`IPR2021-00832
`U.S. Patent No. 8,381,209
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`Fourth, there is substantial overlap and potential for conflict between the
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`proceedings here and in the district court that is not cured by Petitioner’s proffered
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`stipulation (Reply, 3), which has not been filed with the district court. Preliminary
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`invalidity contentions have already been served, and Petitioner includes
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`“exemplary combinations,” all of which rely on Dhawan and/or Clark, the key IPR
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`references, in combination with each other, or in combination with another patent
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`or printed publication. EX2006, 49. Based on the contentions it has served in the
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`district court, even under its “same grounds” stipulation, Petitioner could merely
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`add one additional ancillary reference to its Dhawan and Clark combination or rely
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`on only Dhawan or only Clark for the elements that it argued in its Petition were
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`met by both references. As a result, Petitioner’s offer of a stipulation in which it
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`“will not assert the same grounds” in the district court is effectively meaningless to
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`mitigate potential overlap and conflict. The district court and Board could and still
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`be simultaneously addressing the applicability of Dhawan and Clark to the
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`challenged claims.
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`The proposed stipulation falls far short of the stipulation in the Board’s
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`precedential Sotera case, and does nothing to “mitigate[] any concerns of
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`duplicative efforts between the district court and the Board” or “concerns of
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`potentially conflicting decisions.” Sotera Wireless, Inc. v. Masimo Corp.,
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`3
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`IPR2020-01019, Paper 12 (PTAB Dec. 1, 2020) (precedential), at 19; see also id.,
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`IPR2021-00832
`U.S. Patent No. 8,381,209
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`13-14, 18-19; see also, e.g., Keyme LLC v. The Hillman Group, Inc., IPR2020-
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`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
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`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
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`the merits at or around the same time as the district court case,” weighing “slightly
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`against discretionary denial.” Nvidia Corp. v. Invensas Corp., IPR2020-00603,
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`Paper 11 (PTAB Sept. 3, 2020) (“Nvidia”), at 23. “[A]bove,” the Board had noted
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`that a final written decision would be due over two weeks prior to the trial, Patent
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`Owner had moved to add new entities to the parallel litigation, trial faced potential
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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
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`institution is favored, but Juniper held that a lack of clarity about which
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`4
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`proceeding would conclude first is neutral. Juniper, 16. In Juniper, no trial date
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`IPR2021-00832
`U.S. Patent No. 8,381,209
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`was set and neither party submitted a scheduling order; the same is not true here.
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`And Juniper recognized that if trial precedes a final written decision, denial is
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`favored. Id. That is the case here, as discussed above.
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`Finally, the merits strongly favor denial under factor 6. Petitioner failed to
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`demonstrate obviousness of the key element of the independent claim. E.g., POPR,
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`49-50. Regarding the antedating of Dhawan, Clark, and Chandika, Petitioner
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`ignores that import of the overlap with the district court, where Petitioner’s
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`contentions focus on that same art, and specifically the potential waste of resources
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`and risk of inconsistency in parallel forums on a fact-specific inquiry that here
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`would require extensive third party discovery. POPR, 50-51.
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`Dated: September 24, 2021
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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
`bentzminger@bdiplaw.com
`Counsel for Patent Owner
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`5
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`IPR2021-00832
`U.S. Patent No. 8,381,209
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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
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`foregoing document was served by email upon the following counsel at the below
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`email addresses:
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`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
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`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
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`D2DPTABDocket@orrick.com
`PTABDocketJ3B3@orrick.com
`Microsoft-Daedalus_OHS_Only@orrick.com
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`IPR2021-00832
`U.S. Patent No. 8,381,209
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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
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`Lead Counsel for Patent Owner
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`Dated: September 24, 2021
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`7
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