UNITED STATES PATENT AND TRADEMARK OFFICE
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`____________
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`____________
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`SAMSUNG ELECTRONICS CO., LTD.,
`SAMSUNG ELECTRONICS AMERICA, INC., and GOOGLE LLC,
`Petitioners
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`v.
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`SCRAMOGE TECHNOLOGY LTD.,
`Patent Owner
`____________
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`IPR2022-00385
`Patent 9,843,215
`____________
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`PATENT OWNER’S PRELIMINARY RESPONSE SUR-REPLY
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`____________
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`____________
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`SAMSUNG ELECTRONICS CO., LTD.,
`SAMSUNG ELECTRONICS AMERICA, INC., and GOOGLE LLC,
`Petitioners
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`v.
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`SCRAMOGE TECHNOLOGY LTD.,
`Patent Owner
`____________
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`IPR2022-00385
`Patent 9,843,215
`____________
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`PATENT OWNER’S PRELIMINARY RESPONSE SUR-REPLY
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`Table of Contents
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`The Fintiv Factors Favor Discretionary Denial. ............................................ 1
`I.
`The General Plastic Factors Also Favor Discretionary Denial. .................... 7
`II.
`III. Conclusion. ..................................................................................................... 8
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`IPR2022-00385 (’215 Patent)
`Patent Owner Preliminary Response Sur-reply
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`The district court case concerns the same parties, same patent, same claims,
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`and the same invalidity references. Trial in the district court is also set to occur five
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`months before the deadline for a final written decision in this matter. IPRs were
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`intended to be “an effective and efficient alternative” to district court litigation, but
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`this IPR cannot be such an alternative under these circumstances. Allowing this IPR
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`to proceed simultaneously with the district court litigation would result in
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`duplicative work, risk conflicting decisions, and be an inefficient use of the Board’s
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`finite resources. Institution should be denied.
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`I.
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`The Fintiv Factors Favor Discretionary Denial
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`Factor 1. Petitioner argues that this factor favors institution or is neutral,
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`citing to a single district court case (Kirsch) where Judge Albright granted a motion
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`to stay pending IPR despite the advanced stage of the case. Reply at 3. But Kirsch is
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`easily distinguishable. The district court specifically noted that the defendants had
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`filed their motion to stay “more than sixth months before the Court held the
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`Markman hearing in this case.” Kirsch Rsch. & Dev., LLC v. IKO Indus., Inc., No.
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`6:20-CV-00317-ADA, 2021 WL 4555610, at *3 (W.D. Tex. Oct. 5, 2021).
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`Accordingly, the district court “credit[ed] that early filing” and found the stage of
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`the case factor neutral. In contrast, in the district court litigation here, Petitioner has
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`not even filed a motion to stay. And the district court has already held the Markman
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`hearing and issued its claim construction order. Thus, it is highly unlikely that the
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`1
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`IPR2022-00385 (’215 Patent)
`Patent Owner Preliminary Response Sur-reply
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`district court will grant any future motion to stay filed by Petitioner. Indeed, the
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`district court very recently denied an IPR stay where the parties had not even started
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`claim construction briefing or discovery. See Ex. 2025. Petitioner presents no
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`evidence or authority demonstrating that a stay is likely to be granted. Accordingly,
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`this factor weighs against institution. See Samsung Elecs. Co. Ltd. v. Evolved
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`Wireless LLC, IPR2021-00950, Paper 10 at 10–11 (PTAB Nov. 29, 2021)
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`(“Evolved”) (finding this factor weighed in favor of denial and denying institution
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`where patent owner showed a stay was unlikely based on the advanced stage of the
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`case and past decisions denying stays); Google LLC v. EcoFactor, Inc., IPR2021-
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`01578, Paper 9 at 8 (Mar. 18, 2022) (finding this factor weighed against institution
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`where there was “no evidence that Petitioner had requested a stay” and a stay was
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`unlikely given the stage of the proceeding).
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`Factor 2. Petitioner admits that the Samsung and Google cases have been set
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`for trial on March 6, 2023—five months before the deadline for a final written
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`decision—but nonetheless argues that this factor favors institution because the “trial
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`date may change.” Reply at 3. This argument should be rejected, as the Board
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`“generally take[s] courts’ trial schedules at face value absent some strong evidence
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`to the contrary.” Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 15 at 7–8, at 13
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`(PTAB May 13, 2020) (“Fintiv II”) (denying institution where trial was scheduled
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`two months before the final written decision deadline). Petitioner has presented no
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`2
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`IPR2022-00385 (’215 Patent)
`Patent Owner Preliminary Response Sur-reply
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`such evidence. The two-page article cited by Petitioner (Ex. 1032), written on behalf
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`of a law firm, only examined a very narrow subset of cases. And those cases say
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`nothing about the likelihood of the trial date changing in this case. Indeed, Judge
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`Albright’s standing order governing proceedings in patent cases expressly states that
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`“[a]fter the trial date is set, the Court will not move the trial date except in extreme
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`situations.” Ex. 2008 at 6 (emphasis added). Accordingly, this factor also favors
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`discretionary denial. See, e.g., Evolved at 13 (denying institution trial was scheduled
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`two months before final written decision deadline); Immersion Systems LLC v.
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`Midas Green Techs., LLC, IPR2021-01176, Paper 16 at 12–13 (PTAB Jan. 6, 2022)
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`(“Midas”) (three months).
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`Factor 3. Petitioner asserts that the Board should simply ignore the parties’
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`and the district court’s significant investment in the litigation because some of the
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`work done does not directly relate to invalidity issues. This is contrary to the Board’s
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`decisions finding that “substantive orders related to the patent at issue,” including
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`claim construction orders entered by the district court, favor discretionary denial.
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`Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 11 at 9–10 (PTAB Mar. 20, 2020)
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`(precedential, designated May 5, 2020) (“Fintiv I”). For example, in Midas, the
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`Board found the fact that a claim construction order been entered and discovery was
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`underway was “not insignificant” and denied institution. Midas at 13–14. The Board
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`further found that “although it appears that much is left to occur in the related district
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`3
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`IPR2022-00385 (’215 Patent)
`Patent Owner Preliminary Response Sur-reply
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`court litigation, the evidenced expended effort is nevertheless not insubstantial.” Id.
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`at 14.
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`The same reasoning applies here. Claim construction is completed, discovery
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`is underway, and the parties have exchanged infringement and invalidity
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`contentions. Final contentions are due shortly. See Ex. 2015. This is not
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`insubstantial. “[T]he level of investment and effort already expended on claim
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`construction and invalidity contentions” favors discretionary denial. Fintiv II at 13–
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`14. Petitioner was not diligent in filing it petition 8 months after the complaint was
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`filed. And regardless, the advanced state of the district court litigation still favors
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`denial. See Hillman Group, Inc. v. Hy-Ko Products Co. LLC, IPR2022-00174, Paper
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`8 at 11 (May 9, 2022) (“Hillman”) (finding this factor favored denial and denying
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`institution “[d]espite the lack of delay”).
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`Factor 4. Petitioner does not dispute that the district court case involves the
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`same patent, same claims, and the same invalidity references. Given this complete
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`overlap, Petitioner has stipulated to not pursue invalidity in the district court “using
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`any anticipation or obvious ground that includes any primary reference in the
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`Petition” (Sakuma and Hiroki). Exs. 1028, 1029 (emphasis added). But this narrow
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`stipulation is insufficient and fails to resolve concerns of duplicative issues and
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`inconsistent rulings. Indeed, the stipulation still allows for Petitioner to assert
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`invalidity based on the asserted secondary references, including Suzuki and Akiho,
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`4
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`IPR2022-00385 (’215 Patent)
`Patent Owner Preliminary Response Sur-reply
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`as well as the cited Lefley, Park, Koyanagi, Goto and Bae references. Moreover, the
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`’215 patent is also asserted against Apple in the district court, and Apple has asserted
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`Sakuma and Hiroki as alleged anticipation and obviousness references. Even if
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`Petitioner does not rely on Sakuma or Hiroki, it will still benefit from any findings
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`made in Apple’s favor. Thus, Sakuma and Hiroki will continue to be litigated in
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`district court against the ’215 patent such that Petitioner’s stipulation is meaningless.
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`As explained by the Board in Sand, Petitioner could have stipulated that it
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`“would not pursue any ground raised or that could have been reasonably raised in an
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`IPR, i.e., any ground that could be raised under §§ 102 or 103 on the basis of prior
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`art patents or printed publications.” Sand Revolution II, LLC, Continental
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`Intermodal Grp. – Trucking LLC, IPR2019-01393, Paper 24 at 12 n.5 (PTAB June
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`16, 2020). Such a stipulation “might better address concerns regarding duplicative
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`efforts and potentially conflicting decisions in a much more substantial way.” Id.
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`“Likewise, such a stipulation might help ensure that an IPR functions as a true
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`alternative to litigation in relation to grounds that could be at issue in an IPR.” Id.
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`Petitioner did not make the type of stipulation described in Sand, and instead
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`made the strategic decision to limit its stipulation to the two asserted “primary
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`references.” Indeed, even in the Samsung case cited by Petitioner (Reply at 1), the
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`Board found this factor weighed only “slightly in favor of not exercising
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`discretionary denial.” Samsung at 13; see also Sand at 12 (same); but see Evolved at
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`5
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`Patent Owner Preliminary Response Sur-reply
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`15 (finding this factor weighed against institution despite petitioner’s limited
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`stipulation). Factor 4 thus weighs against institution, or is neutral at best.
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`Factor 5. There is no dispute that Petitioner is the defendant in the district
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`court litigation. Indeed, Petitioner’s reply does not address this factor at all. This also
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`favors denial. See Fintiv II at 15; Midas at 18; Evolved at 16; Hillman at 14.
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`Factor 6. The petition is substantively weak for the reasons detailed in Patent
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`Owner’s Preliminary Response. And contrary to Petitioner’s suggestions, Patent
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`Owner was not required to provide a full analysis of the merits of the petition with
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`expert testimony in order to support discretionary denial. See Fintiv II at 17.
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`In addition, Petitioner’s attempts to explain the discrepancies in its claim
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`construction positions are unavailing. The facts are straightforward: in the district
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`court, Petitioner argued that the district court should construe “arranged on” as “in
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`contact with.” Ex. 2014 at 6, Ex. 2020 at 6. And in the petition, Petitioner asserts
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`that no terms require construction, i.e., they should be given their plain meaning.
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`Petition at 7. If Petitioner’s claim construction positions for “arranged on” were truly
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`the same, the Petitioner would have agreed with Patent Owner’s proposal in district
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`court that the term should be given its plain and ordinary meaning. Petitioner,
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`however, adamantly maintained that “‘arranged on’ requires contact, either directly
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`or through an adhesive layer that allows for such contact.” Ex. 2023 at 11, Ex. 2024
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`at 11. In light of these clear consistencies, Orthopediatrics is indeed applicable here.
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`6
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`IPR2022-00385 (’215 Patent)
`Patent Owner Preliminary Response Sur-reply
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`II. The General Plastic Factors Also Favor Discretionary Denial
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`Factor 1. While it may be true, as Petitioner asserts, that the first factor weighs
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`against discretionary denial, Petitioner does not and cannot dispute that this factor is
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`not dispositive, and that the Board has denied institution in multiple instances where
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`the follow-on petition was filed by a different petitioner. See, e.g., NetApp Inc. v.
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`Realtime Data LLC, IPR2017-01195, Paper 9 (Oct. 12, 2017) (“NetApp”). On
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`balance, the weight of all the relevant factors supports discretionary denial.
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`Factors 2–3. The Board’s decision in NetApp makes clear that the second
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`factor is indeed neutral in cases not involving the same petitioner. Id. at 10. The same
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`reasoning applies to the third factor, which likewise does not apply here. See id.
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`Petitioner cites no authority supporting that these factors favor institution under
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`these facts.
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`Factors 4–5. Petitioner admits that it knew of the asserted prior art references
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`at least by November 15, 2021, when it served its invalidity contentions in the district
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`court. Reply at 7. In reality, Petitioner must have known about these references much
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`earlier than the date it served the contentions. Regardless, Petitioner still fails to
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`explain why it delayed eight months after the filing of the complaint, and seven
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`weeks after Petitioner served the invalidity contentions, in filing the petition.
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`Petitioner simply relies on the fact that the petition was filed within the one-year
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`statutory period. But this is not a relevant consideration under this factor. If it were,
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`7
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`IPR2022-00385 (’215 Patent)
`Patent Owner Preliminary Response Sur-reply
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`these factors would be a nullity and could never favor discretionary denial. But the
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`Board’s prior decisions confirm that under circumstances where, as here, Petitioner
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`“knew or should have known” of the asserted references and “provided no
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`explanation” for its delay, these factors favor discretionary denial. See, e.g., NetApp
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`at 11–12.
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`Factors 6–7. Petitioner does not dispute that its petition covers the claims
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`challenged in the earlier Apple IPR. Nor does Petitioner provide any explanation for
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`why it did not join the Apple IPR, which would have been more efficient than later
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`filing a separate proceeding on the same patent and same claims. Further, as in
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`NetApp, “[t]here would be no offsetting conservation of the [Western] District of
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`Texas’ judicial resources because any final written decision in this proceeding would
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`not issue until well after the scheduled trial date in the [Samsung and Google]
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`Litigation.” Id. at 13. Thus, Petitioner cannot legitimately dispute that this favors
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`denial. Contrary to Petitioner’s assertions, the factual differences NetApp are
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`inconsequential. The underlying principles regarding application of the General
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`Plastic factors articulated therein are applicable here and support discretionary
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`denial.
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`III. Conclusion
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`For the reasons stated herein and in the POPR, the Board should exercise its
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`discretion to deny institution.
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`8
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` Date: May 31, 2022
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`IPR2022-00385 (’215 Patent)
`Patent Owner Preliminary Response Sur-reply
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`Respectfully submitted,
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`By: /Brett Cooper/
`Brett Cooper, Reg. No. 55,085
`bcooper@raklaw.com
`rak_scramoge@raklaw.com
`Reza Mirzaie, Reg. No. 69,138
`rmirzaie@raklaw.com
`Russ, August & Kabat
`12424 Wilshire Blvd. 12th Floor
`Los Angeles, CA 90025
`Tel.: 310-826-7474
`Fax: 310-826-6991
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`Counsel for Patent Owner,
`Scramoge Technology, Ltd.
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`9
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`IPR2022-00385 (’215 Patent)
`Patent Owner Preliminary Response Sur-reply
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`CERTIFICATE OF SERVICE (37 C.F.R. § 42.6(e)(1))
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`The undersigned hereby certifies that the above document was served on May
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`31, 2022 by filing this document through the Patent Trial and Appeal Board End to
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`End system, as well as delivering a copy via electronic mail upon the following
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`attorneys of record for the Petitioner:
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`John Kappos (Reg. No. 37,861)
`Email: jkappos@omm.com
`Cameron W. Westin (Reg. No. 66,188)
`Email: cwestin@omm.com
`O’Melveny & Myers LLP
`610 Newport Center Dr., 17th Floor
`Newport Beach, CA 92660
`Telephone: 949-823-6900
`Fax: 949-823-6994
`
`Naveen Modi (Reg. No. 46,224)
`Joseph E. Palys (Reg. No. 46,508)
`Phillip Citroën (Reg. No. 66,541)
`Paul M. Anderson (Reg. No. 39,896)
`Quadeer A. Ahmed (Reg. No. 60,835)
`Paul Hastings LLP,
`2050 M St., N.W.
`Washington, DC 20036
`Telephone: (202) 551-1990
`Fax: (202) 551-1705
`Email: PH-Google-Scramoge-IPR@paulhastings.com
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`Date: May 31, 2022
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`RUSS AUGUST & KABAT
`12424 Wilshire Blvd., 12th Fl.
`Los Angeles, CA 90025
`(310) 826-7474
`
`Brett Cooper
`Reg. No. 55,085
`Attorney for Patent Owner
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`
` /Brett Cooper/
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