UNITED STATES PATENT AND TRADEMARK OFFICE
`
`____________
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`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`____________
`
`
`ECOBEE TECHNOLOGIES, ULC,
`Petitioner
`
`v.
`
`ECOFACTOR, INC.,
`Patent Owner
`____________
`
`IPR2022-00969
`Patent No. 8,596,550
`____________
`
`
`PATENT OWNER’S PRELIMINARY RESPONSE
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`

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`Table of Contents
`
`I.
`
`Introduction ............................................................................................................................. 1
`
`II. Petitioner’s Asserted Grounds and References ....................................................................... 2
`
`III. The Petition Fails to Establish a Reasonable Likelihood of Success on the Merits ............... 2
`
`A. Claim 17j requires comparing computer-calculated setpoints with actual setpoints .......... 3
`
`B. Ehlers in view of Wruck does not render obvious comparing computer-calculated
`setpoints with actual setpoints .................................................................................................... 4
`
`C. Ols in view of Wruck does not render obvious comparing computer-calculated setpoints
`with actual setpoints .................................................................................................................... 7
`
`IV. Institution Should Be Denied Under the Fintiv Factors ........................................................ 10
`
`A. Parallel Proceedings .......................................................................................................... 11
`
`B. Factor 1 weighs against institution, as there is no stay in the district court now and no
`evidence exists that a stay may be granted in the future. .......................................................... 13
`
`C. Factor 2 weighs slightly against institution, as trial in the district court is scheduled to be
`completed less than one month after the FWD. ........................................................................ 15
`
`D. Factor 3 weighs against institution, as discovery is well underway and claim construction
`proceedings in the district court case will be almost completed as of the date the institution
`decision is due. .......................................................................................................................... 16
`
`E. Factor 4 weighs against institution, as there is overlap between this IPR and the district
`court case. ................................................................................................................................. 19
`
`F. Factor 5 weighs against institution, as Petitioner is a Respondent in the parallel district
`court case. ................................................................................................................................. 21
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`G. Factor 6 weighs against institution. .................................................................................. 21
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`H. Summary Regarding Fintiv Factors .................................................................................. 22
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`V. Conclusion ............................................................................................................................ 23
`
`
`
`i
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`

`

`Table of Authorities
`
`Cases
`Apple Inc., v. Fintiv, Inc.,
`IPR2020-00019, Paper 11 (PTAB Mar. 20, 2020) ............................................................ passim
`Apple Inc., v. Fintiv, Inc.,
`IPR2020-00019, Paper 15 (PTAB May 13, 2020) ............................................................. passim
`Cisco Systems, Inc. v. Ramot at Tel Aviv University Ltd.,
`IPR2020-00123, Paper 14 (PTAB May 15, 2020) .................................................................... 12
`Intel Corp. v. VLSI Tech. LLC,
`IPR2020-00158, Paper 16 (PTAB May 20, 2020) .............................................................. 13, 16
`NHK Spring Co. v. Intri-Plex Techs., Inc.,
`IPR2018-00752, Paper 8 (PTAB Sept. 12, 2018) ................................................... 10, 15, 20, 22
`Statutes
`35 U.S.C. § 314(a) .................................................................................................................. 10, 22
`
`
`
`
`
`
`ii
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`

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`IPR2022-00969
`Patent No. 8,596,550
`
`Exhibits
`
`Description
`Ecobee, Inc. v. EcoFactor, Inc., 1-21-cv-00323 (D. Del. March
`2, 2012), Dkt. 20 (Ecobee’s Motion to Dismiss)
`Ecobee, Inc. v. EcoFactor, Inc., 1-21-cv-00323 (D. Del. March
`2, 2012), Dkt. 1 (Complaint)
`Ecobee, Inc. v. EcoFactor, Inc., 1-21-cv-00323 (D. Del. March
`2, 2012), Dkt. 18 (ecobee Opposition to Motion to Stay)
`Ecobee’s Disclosure of Initial Invalidity Contentions, March 17,
`2022 in Ecobee, Inc. v. EcoFactor, Inc., 1-21-cv-00323
`Ecobee, Inc. v. EcoFactor, Inc., 1-21-cv-00323 (D. Del. March
`2, 2012), Dkt. 26 (Order Denying EcoFactor’s Motion to Stay)
`
`
`
`Exhibit No.
`2001
`
`2002
`
`2003
`
`2004
`
`2005
`
`
`
`iii
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`

`

`IPR2022-00969
`Patent No. 8,596,550
`
`I.
`
`Introduction
`
`The Petition challenges claims 17-23 of U.S. Patent No. 8,596,550 (Ex. 1001)
`
`under two grounds of unpatentability. The Petition fails to establish a reasonable
`
`likelihood of success on the merits. The challenged claims require a computer to
`
`compare an automated setpoint (i.e., a computer-calculated setpoint) with an actual
`
`setpoint, which allows the patented system to determine if the setpoints that the
`
`computer is calculating are acceptable to the user, or if the user is fighting with or
`
`opting-out of the automated programming. The Petition fails to show that prior art
`
`discloses or renders obvious this limitation.
`
`Moreover, instituting review in this IPR would cause the parties and the Board
`
`to incur significant inefficiencies and wasted efforts of the type warned of in Fintiv
`
`and NHK Spring. Over a year ago, on March 2, 2021, Petitioner ecobeee
`
`Technologies, ULC1 filed a complaint in U.S. District Court for the District of
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`Delaware against Patent Owner EcoFactor for a declaratory judgement of non-
`
`infringement of the ‘550 patent. EcoFactor filed its counter-claim on May 5, 2021.
`
`That district court case has progressed substantially, with discovery having started
`
`
`1 ecobee, Inc. was acquired by Generac Holdings Inc. After the acquisition, ecobee,
`
`Inc. became ecobee Technologies ULC d/b/a/ ecobee, which is the Petitioner in this
`
`proceeding. Ex. 2001, ecobee Motion to Dismiss at fn. 1.
`
`
`
`1
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`

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`IPR2022-00969
`Patent No. 8,596,550
`months ago, initial infringement and invalidity contentions having already been
`
`served, and claim construction beginning in August 2022. Further, fact discovery is
`
`scheduled to close on March 8, 2023, expert discovery is scheduled to close on June
`
`19, 2023, case dispositive briefing will occur by July 6, 2023, and trial is scheduled
`
`to start on December 11, 2023, less than one month after the final written decision
`
`would be due in this IPR proceeding (should it be instituted). Moreover, the district
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`court case involves the same claim construction standard and the same claims,
`
`invalidity theories, and prior art as this IPR. Under the PTAB’s precedential orders
`
`in Fintiv and NHK Spring, the Board should exercise its discretion to deny institution
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`under § 314(a).
`
`II.
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`Petitioner’s Asserted Grounds and References
`
`The Petition asserts the following grounds of unpatentability:
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`• “Claims 17-23 are obvious over Ehlers in view of Wruck.”
`
`• “Claims 17-23 are obvious over Ols in view of Boait and Wreck.” (Pet.
`
`at 10-11).
`
`III. The Petition Fails to Establish a Reasonable Likelihood of Success on
`the Merits
`Institution should be denied because the Petition fails to establish a reasonable
`
`likelihood of success on the merits. The challenged claims require a computer to
`
`compare an automated setpoint (i.e., a computer-calculated setpoint) with an actual
`
`setpoint. This comparison allows the patented system to determine if the setpoints
`
`
`
`2
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`

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`IPR2022-00969
`Patent No. 8,596,550
`that the computer is calculating are acceptable to the user, or if the user is fighting
`
`with or opting-out of the automated programming. See, e.g., Ex. 1001 (’550 patent)
`
`at 5:54-6:30 (the server compares, for “time0,” the “actual setpoint as recorded at
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`the thermostat (A0)” with “automated setpoint changes C that have been scheduled
`
`for the thermostat by server 106 at time0. Such changes may include algorithmic
`
`changes intended to reduce energy consumption, etc.”). The Petition fails to show
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`that the prior art discloses or renders obvious this limitation.
`
`A. Claim 17j requires comparing computer-calculated setpoints with
`actual setpoints
`Claim 17j recites: “the one or more computer processors configured to
`
`compare the one or more automated setpoints associated with said scheduled
`
`setpoint programming with said actual setpoint programming.”
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`Patent Owner agrees with Petitioner that “automated setpoint” should be
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`construed as a “computer-calculated temperature setting for a thermostat to achieve
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`or maintain.” Pet. at 11. For example, the ’550 patent discloses a server computer
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`that uses an algorithm to calculate “automated setpoints.” Ex. 1001 (’550 patent),
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`5:35-40 (“…using the ability to predict the rate of change to determine when the
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`HVAC system must be turned on in order to reach the desired temperature at the
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`desired time”), 5:54-6:30 (“automated setpoint changes C that have been scheduled
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`for the thermostat by server 106 at time0. Such changes may include algorithmic
`
`changes intended to reduce energy consumption, etc.”). Accordingly, Claim 17j
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`
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`3
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`IPR2022-00969
`Patent No. 8,596,550
`requires the one or more computer processors to compare the computer-calculated
`
`setpoints associated with the scheduled setpoint programming with the actual
`
`setpoint programming.
`
`B.
`
`Ehlers in view of Wruck does not render obvious comparing
`computer-calculated setpoints with actual setpoints
`The Petition alleges that:
`
`Ehlers’s system can detect a manual change to a setpoint. (Ex. 1004,
`¶¶0242-0243, 0268, 0308, 0309) (Ex. 1002, ¶124). A POSITA would
`have understood that in order to perform the disclosed functions—
`namely tracking and learning from the user’s changes to setpoints,
`Ehlers’s system would logically detect when a user has made a manual
`change to the setpoint. (Ex. 1002, ¶124).
`
`Pet. at 43-44. This argument does not establish a reasonable likelihood of success
`
`because it does not even address the requirement of 17j to compare an actual setpoint
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`with an automated setpoint (i.e., a computer-calculated setpoint). The Petition only
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`alleges that Ehlers “can detect a manual change to a setpoint” and that Ehlers learns
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`what temperatures the user prefers. Pet. at 43-44. The Petition fails to even allege
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`that Ehlers compares the user’s actual setpoints with a setpoint that was calculated
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`by a computer, even though this is the agreed construction for “automated setpoint.”
`
`Pet. at 11.
`
`In fact, the Petition does not identify what in Ehlers represents “the one or
`
`more automated setpoints” for purposes of claim 17j and does not apply the agreed
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`construction for “automated setpoints.” Pet. at 43-44. The Declaration of David
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`
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`4
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`

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`IPR2022-00969
`Patent No. 8,596,550
`Auslander also fails to identify what in Ehlers represents “the one or more automated
`
`setpoints” for purposes of claim 17j and does not apply the agreed construction for
`
`“automated setpoints.” Ex. 1002, ¶ 124. This is insufficient to establish a reasonable
`
`likelihood of success.
`
`Nor does the Petition address the antecedent basis for “the one or more
`
`automated setpoints” in Claim 17j. For example, Claim 17h requires a “database that
`
`stores the one or more automated setpoints.” But the Petition for Claim 17h does not
`
`identify what in Ehlers constitutes an “automated setpoint” that is “stored” in a
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`“database.” Pet. at 39-40. And for Claim 17j, the Petition again is silent on what in
`
`Ehlers represents “the one or more automated setpoints” for purposes of both Claim
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`17h and 17j. Pet. at 43-44.
`
`The Petition also fails to explain how the cited portions of Ehlers render
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`obvious comparing an actual setpoint with an automated setpoint (i.e., a computer-
`
`calculated setpoint). For example, the Petition does not identify what in Ehlers
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`¶¶0242-0243 constitutes “the one or more automated setpoints,” does not apply the
`
`agreed construction (“computer-calculated”), and does not address antecedent basis,
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`even though “the one or more automated setpoints” has antecedent basis in Claim
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`17. Pet. at 43-44. To the extent that the Petition is alleging that Ehlers learns what
`
`temperatures the user prefers, this is not explained in the Petition; but even if it was,
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`the Petition does not explain how learning what temperatures the user prefers relates
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`
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`5
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`IPR2022-00969
`Patent No. 8,596,550
`to comparing with computer-calculated setpoints or determining when a user is
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`fighting with or opting-out of computer-calculated setpoint programming. Pet. at 43-
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`44.
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`Similarly, where the Petition references Ehlers ¶¶0308-0309, the Petition does
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`not identify what aspect of these disclosures relates to comparing an automated
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`setpoint (i.e., a computer-calculated setpoint) with an actual setpoint. For example,
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`the Petition does not explain why “set point pattern change tracking tables” discloses
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`comparing an actual setpoint with a computer-calculated setpoint. Even assuming
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`arguendo that “set point pattern change tracking tables” relates to comparing a user’s
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`changes to actual setpoints over time, the Petition does not explain how tracking
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`patterns of setpoint changes over time relates to comparing with computer-
`
`calculated setpoints or determining when a user is fighting with or opting-out of
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`computer-calculated setpoint programming. Pet. at 43-44.
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`Instead, both the Petition and the supporting declaration of David Auslander
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`assume that Claim 17j only requires “detect[ing] when a user has manually changed
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`the setpoint.” Pet. at 44. This has no bearing on whether it would have been obvious
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`to compare an actual setpoint with an automated setpoint to learn whether what the
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`computer is doing is acceptable to the user. Pet. at 44. Indeed, the Petition repeatedly
`
`argues for Claim 17j that the limitation only requires comparing an actual setpoint
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`with a scheduled setpoint, without regard for the agreed construction of “automated
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`
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`6
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`

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`IPR2022-00969
`Patent No. 8,596,550
`setpoint” as “computer-calculated.” See e.g., Pet. at 45 (“From this, a POSITA would
`
`have understood that one could compare (or ‘analyze to determine one or more
`
`similarities or differences between’) an actual setpoint and an automated setpoint in
`
`order to determine whether the user had entered a manual setpoint that was different
`
`from the automated (scheduled) setpoint.”). While the Petition parrots the claim
`
`language (“automated setpoint”), in fact, it only even purports to show comparisons
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`between actual setpoints and scheduled setpoints or between actual setpoints and
`
`other actual setpoints. This is not sufficient.
`
`As to Wruck, the Petition’s allegations are conclusory and unsupported in
`
`Wruck. Pet. at 44-45. Wruck is alleged to teach checking “whether the Delta value
`
`between the actual temporary setpoint and the scheduled setpoint is not equal to
`
`zero.” Pet. at 44-45. But displaying a user’s manual adjustment to a scheduled
`
`setpoint has no bearing on whether it would be obvious to compare an automated
`
`setpoint with an actual setpoint. Pet. at 44-45. And the Petition never explains how
`
`Wruck describes or suggests any form of automated (computer-calculated) setpoint.
`
`Wruck’s disclosures that allegedly relate to checking if the actual setpoint is different
`
`from a scheduled setpoint simply are not relevant to Claim 17j’s requirement for a
`
`comparison of an actual setpoint to an automated setpoint.
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`C. Ols in view of Wruck does not render obvious comparing
`computer-calculated setpoints with actual setpoints
`
`
`
`7
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`

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`IPR2022-00969
`Patent No. 8,596,550
`As to Ols in view of Wruck, the Petition does not establish a reasonable
`
`likelihood of success because it does not address the requirement of Claim 17j to
`
`compare an actual setpoint with an automated setpoint (i.e., a computer-calculated
`
`setpoint). The Petition only alleges that Ols “teaches recognizing a user override of
`
`the setpoint where upon selecting desired temperature 614 a user may input a value
`
`representing a new desired temperature” and that Ols would “determine when a user
`
`has manually changed the setpoint to be different from what was previously
`
`programmed.” Pet. at 69-70. The Petition fails to allege that Ols ever compares the
`
`user’s actual setpoints with a setpoint that was calculated by a computer. None of
`
`the Petition’s arguments about Ols even arguably address the agreed construction of
`
`“automated setpoint,” which requires a setpoint calculated by a computer.
`
` In fact, the Petition does not identify what in Ols represents “the one or more
`
`automated setpoints” for purposes of Claim 17j. Pet. at 69-70. The Petition only
`
`references Ols (Ex. 1006) at 31:20-42, and the Petition alleges that this portion of
`
`Ols describes recognizing that a user has input a value representing a new desired
`
`temperature relative to the user’s previous desired temperature. Pet. at 69-70. But
`
`recognizing that the user has a new desired temperature relative to the user’s
`
`previous desired temperature has not been shown to relate in any way to Claim 17j’s
`
`comparison of an actual setpoint to an automated (computer-calculated) setpoint.
`
`
`
`8
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`

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`IPR2022-00969
`Patent No. 8,596,550
`The alleged functionality of Ols has nothing to do with determining if the user is
`
`fighting with or opting-out of programming that was calculated by a computer.
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`As with Ehlers, the Petition’s discussion of Ols also does not address the
`
`antecedent basis for “the one or more automated setpoints” in Claim 17j. Pet. at 69-
`
`70. For example, Claim 17h requires a “database that stores the one or more
`
`automated setpoints.” But the Petition for Claim 17h does not identify what in Ols
`
`constitutes an “automated setpoint” that is “stored” in a “database.” Pet. at 69-70.
`
`And for Claim 17j, the Petition again is silent on what in Ols represents “the one or
`
`more automated setpoints” for purposes of both Claim 17h and 17j. Pet. at 69-70.
`
`The Petition also fails to explain how the cited portions of Ols render obvious
`
`comparing an actual setpoint with an automated setpoint (i.e., a computer-calculated
`
`setpoint). As with Ehlers, this is insufficient to show that Ols renders obvious Claim
`
`17.
`
`As to Wruck, the Petition’s allegations are conclusory and unsupported in
`
`Wruck. Pet. at 44-45, 70-71. Wruck is alleged to teach checking “whether the Delta
`
`value between the actual temporary setpoint and the scheduled setpoint is not equal
`
`to zero.” Pet. at 44-45, 70-71. But displaying a user’s manual adjustment to a
`
`scheduled setpoint has no bearing on whether it would be obvious to compare an
`
`automated setpoint with an actual setpoint. Pet. at 44-45, 70-71. And the Petition
`
`never explains how Wruck describes or suggests any form of automated (computer-
`
`
`
`9
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`

`

`IPR2022-00969
`Patent No. 8,596,550
`calculated) setpoint. Wruck’s disclosures that allegedly relate to checking if the
`
`actual setpoint is different from a scheduled setpoint simply are not relevant to Claim
`
`17j’s requirement for a comparison of an actual setpoint to an automated setpoint.
`
`IV.
`
`Institution Should Be Denied Under the Fintiv Factors
`
`35 U.S.C. § 314(a) gives the Board discretion to deny institution because of
`
`efficiency considerations stemming from parallel proceedings on the same patent.
`
`See NHK Spring Co. v. Intri-Plex Techs., Inc., IPR2018-00752, Paper 8 (PTAB Sept.
`
`12, 2018) (precedential, designated May 7, 2019) (“NHK Spring”). The PTAB
`
`recently promulgated six factors for determining whether discretionary denial due to
`
`efficiency considerations relating to parallel proceedings is appropriate (the “Fintiv
`
`factors”):
`
`2.
`
`3.
`4.
`
`1. whether the court granted a stay or evidence exists that one may be
`granted if a proceeding is instituted;
`proximity of the court’s trial date to the Board’s projected statutory
`deadline for a final written decision;
`investment in the parallel proceeding by the court and the parties;
`overlap between issues raised in the petition and in the parallel
`proceeding;
`5. whether the petitioner and the defendant in the parallel proceeding are
`the same party; and
`other circumstances that impact the Board’s exercise of discretion,
`including the merits.
`
`6.
`
`
`
`10
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`

`

`IPR2022-00969
`Patent No. 8,596,550
`Apple Inc., v. Fintiv, Inc., IPR2020-00019, Paper 11 (PTAB Mar. 20, 2020)
`
`(precedential, designated May 5, 2020) (“Fintiv Order”) at 6; Apple Inc., v. Fintiv,
`
`Inc., IPR2020-00019, Paper 15 (PTAB May 13, 2020) (order denying institution)
`
`(informative, designated July 13, 2020) (“Fintiv ID”) at 7–8. Here, all six Fintiv
`
`factors weigh against institution.
`
`A.
`
`Parallel Proceedings
`
`Over a year ago, on March 2, 2021, Petitioner ecobee Technologies, ULC
`
`(“ecobee”) filed a declaratory judgement action in U.S. District Court of Delaware
`
`against Patent Owner EcoFactor alleging that ecobee does not infringe the ‘550
`
`patent. Ex. 2002, Ecobee, Inc. v. EcoFactor, Inc., 1-21-cv-00323, Dkt. 1 (D. Del.
`
`March 2, 2021) (Complaint). EcoFactor filed a counterclaim on May 5, 2021. Pet. at
`
`74; Ex. 1013, Count III.
`
`This Petition for inter partes review was filed on May 5, 2022, over 14 months
`
`after ecobee started the litigation and exactly one full year after EcoFactor filed its
`
`counterclaim. Contrary to ecobee’s assertions in its petition, the district court case is
`
`substantially advanced, as discovery has opened, the parties have exchanged initial
`
`infringement and invalidity contentions and claim construction has started. Ex. 1014,
`
`Ecobee, Inc. v. EcoFactor, Inc., 1-21-cv-00323, Dkt. 29 (D. Del. March 2, 2012)
`
`(Revised Scheduling Order) at 14. The claim construction briefing will be completed
`
`
`
`11
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`IPR2022-00969
`Patent No. 8,596,550
`in November, 2022, and the Markman hearing is scheduled for December 8, 2022.
`
`Id. at 15.
`
`Further, by the time the final written decision (“FWD”) would be due
`
`(November 2023) in this IPR proceeding (should it be instituted), both fact and
`
`expert discovery will have closed (March 8, 2023 and June 19, 2023, respectively),
`
`EcoFactor’s final infringement claim charts and ecobee’s final invalidity contentions
`
`will be due (January 12, 2023 and February 13, 2023, respectively), and case
`
`dispositive briefing will have been completed (July 6, 2023). Id. at 14-15. Moreover,
`
`the trial is scheduled to start less than one month after the final written decision
`
`would be due. Id. at 15. Certain findings in the district court case will likely be
`
`instructive and may be dispositive of certain issues in this IPR proceeding, including
`
`claim construction and invalidity.
`
`The district court case qualifies as a parallel proceeding that justifies
`
`discretionary denial. Parties expend enormous resources in district court cases, and
`
`district court is a forum where parties can litigate their disputes fully and fairly. See
`
`Fintiv Order at 6 (explaining that the Fintiv factors “relate to whether efficiency,
`
`fairness, and the merits support the exercise of authority to deny institution in view
`
`of an earlier trial date in the parallel proceeding”); see also, e.g., Cisco Systems, Inc.
`
`v. Ramot at Tel Aviv University Ltd., IPR2020-00123, Paper 14 at 11 (PTAB May
`
`15, 2020) (denying institution where it “would be an inefficient use of Board, party,
`
`
`
`12
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`

`

`IPR2022-00969
`Patent No. 8,596,550
`and judicial resources”); Intel Corp. v. VLSI Tech. LLC, IPR2020-00158, Paper 16
`
`at 14 (PTAB May 20, 2020) (same).
`
`As set forth herein, the Board should exercise its discretion to deny institution
`
`here.
`
`B.
`
`Factor 1 weighs against institution, as there is no stay in the
`district court now and no evidence exists that a stay may be
`granted in the future.
`Factor 1 concerns whether the district court granted a stay or evidence exists
`
`that one may be granted if a proceeding is instituted. Fintiv Order at 6; Fintiv ID at
`
`12. This factor weighs against institution.
`
`No stay has been issued in the concurrent Ecobee, Inc. v. EcoFactor, Inc.
`
`litigation. In fact, ecobee opposed EcoFactor’s motion to stay the litigation pending
`
`the decision in a parallel ITC proceeding involving the same patents. Ex. 2003,
`
`Ecobee, Inc. v. EcoFactor, Inc., 1-21-cv-00323, Dkt. 18 (D. Del. March 2, 2021)
`
`(ecobee Opposition to Motion to Stay). In light of ecobee’s opposition, the court
`
`denied EcoFactor’s motion to stay. Ex. 2005, Ecobee, Inc. v. EcoFactor, Inc., 1-21-
`
`cv-00323, Dkt. 26 (D. Del. March 2, 2012) (Order Denying EcoFactor’s Motion to
`
`Stay).
`
`Further, it is unlikely that the district court case will be stayed pending IPR.
`
`As noted above, ecobee has not requested any stay pending IPR in the district court
`
`case and in fact opposed a stay sought by EcoFactor. A stay is even more unlikely
`
`
`
`13
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`IPR2022-00969
`Patent No. 8,596,550
`considering the advanced stage of the district court case, with both claim
`
`construction proceedings and fact discovery having already begun. EcoFactor
`
`identified its “Accused Products and Damages Model” on November 12, 2021. Ex.
`
`1014, at 14. ecobee produced its “Core Technical Documents and Sales Figures” on
`
`December 15, 2021. Id. As noted previously, the parties have exchanged initial
`
`infringement and invalidity contentions. Id. This is all in stark contrast to ecobee’s
`
`erroneous statements that the “co-pending litigation is in its early stages” and
`
`“Neither the parties nor the court has invested substantial resources therein.”2 Pet. at
`
`68. Instituting this IPR will not promote judicial efficiency. Rather, substantial work
`
`in the district court would have been completed even before the due date of an
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`institution decision in this IPR.
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`2 The Revised Scheduling Order in the concurrent Ecobee, Inc. v. EcoFactor, Inc.,
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`1-21-cv-00323 litigation, which ecobee provided as Ex. 1014 to its Petition, was
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`entered on October 14, 2021, which is almost 7 months prior to ecobee filing the
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`instant Petition. Thus, at the time the Petition was filed, ecobee was well aware of
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`the investments the parties had made as of the filing of ecobee’s Petition, as well as
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`the substantial investments that will be made through the date of the FWD if this
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`Petition is instituted.
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`14
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`C.
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`IPR2022-00969
`Patent No. 8,596,550
`Factor 2 weighs slightly against institution, as trial in the district
`court is scheduled to be completed less than one month after the
`FWD.
`Factor 2 relates to proximity of the court’s trial date to the Board’s projected
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`statutory deadline for a final written decision. Fintiv Order at 9; Fintiv ID at 12. The
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`statutory deadline for the FWD for this IPR Petition would be no later than
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`November 17, 2023 (should it be instituted). This is less than one month before the
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`scheduled trial date in the district court litigation of December 11, 2023. See Ex.
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`1014, at 15.
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`Under Factor 2, this weighs slightly against institution. See Fintiv Order at 9
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`(“If the court’s trial date is earlier than the projected statutory deadline, the Board
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`generally has weighed this fact in favor of exercising authority to deny institution
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`under NHK.”). As NHK Spring explained, one of the primary objectives of the AIA
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`was “to provide an effective and efficient alternative” to parallel litigation. NHK
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`Spring at 19–20 (quoting General Plastic at 16–17) (emphasis added).
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`Although Fintiv involved a situation where the trial occurred before the FWD,
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`here the FWD would occur no later than November 17, 2023, which is less than one
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`month before the scheduled start of the trial. Critically, the FWD would be over 4
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`months after “Case Dispositive Briefing” occurs on July 6, 2023. Ex. 1014, at 15.
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`Even though the trial is scheduled after the FWD is due, by that time the parties will
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`have prepared for all issues and filed any dispositive briefing, including any issues
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`15
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`IPR2022-00969
`Patent No. 8,596,550
`and briefing directed toward invalidity due to prior art. Thus, the present IPR
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`proceeding (if instituted) would not be an “efficient alternative” to the parallel
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`litigation, as the parallel litigation will be complete except for trial by the time the
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`FWD issues.
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`The Petition’s arguments regarding Factor 2 (Pet. at 74) are wrong. For
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`example, ecobee argues that “the co-pending litigation is in its early stages” and that
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`“Neither the parties nor the court has invested substantial resources therein.” Pet. at
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`74. But as noted above, the parties have already exchanged initial infringement and
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`invalidity contentions, and exchanged proposed claim terms for construction for
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`claim construction briefing. Ex. 1014, at 14. Further, substantial work will have been
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`undertaken by both parties by the time the FWD is due, including the completion of
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`claim construction, fact and expert discovery, and briefing on any dispositive
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`motions. Id. at 14-15.
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`Here, this IPR cannot be an alternative to a trial in the district court set to
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`occur shortly after the date of the FWD deadline. This alone provides a reason for
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`the Board to exercise its discretion to deny institution. Fintiv ID at 13; Intel Corp. v.
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`VLSI Tech. LLC, IPR2020-00158, Paper 16 at 9 (PTAB May 20, 2020).
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`D.
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`Factor 3 weighs against institution, as discovery is well underway
`and claim construction proceedings in the district court case will
`be almost completed as of the date the institution decision is due.
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`16
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`IPR2022-00969
`Patent No. 8,596,550
`Factor 3 relates to investment in the parallel proceeding by the court and the
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`parties. Fintiv Order at 9; Fintiv ID at 14. Here, the parties and the district court have
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`already (and will continue to) invest enormous effort and resources.
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`Importantly, this factor is judged from the date of the institution decision,
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`which is expected to be in no later than November 17, 2022. See Fintiv Order at 9
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`(considering “the amount and type of work already completed in the parallel
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`litigation by the court and the parties at the time of the institution decision”)
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`(emphasis added).
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`The initial district court case was filed over 17 months ago, back in March
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`2021, and the parties have expended substantial resources since then with the
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`exchange of various initial contentions, including initial invalidity contentions. Ex.
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`1014 at 14. Fact discovery began months ago and ecobee has already produced its
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`“Core Technical Documents and Sales Figures” on December 15, 2021, almost five
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`months before it filed this Petition. Id. at 14. Further, as of the institution date (no
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`later than November 17, 2022), substantive claim construction briefing will have
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`been completed. Id. at 14-15.
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`Further, the Petition could have been filed much sooner, but Petitioner waited
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`until May 5, 2022 to file the Petition—15 months after the ‘550 patent was asserted
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`against ecobee in the ITC (see Ex. 2003 at 5), 14 months after the district court case
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`began on March 3, 2021, and one full year after EcoFactor filed its cross-complaint.
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`17
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`IPR2022-00969
`Patent No. 8,596,550
`ecobee argues that it waited the full year because it “hoped that a victory at the ITC
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`would end the dispute.” Pet. at 75. But this position ignores that ecobee, back on
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`July 13, 2021, when it opposed a stay of the district court litigation, specifically
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`understood and recognized that “the ITC’s rulings are not binding on the District
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`Court.”3 Ex. 2003, Ecobee, Inc. v. EcoFactor, Inc., 1-21-cv-00323, Dkt. 18 at 2 (D.
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`Del. March 2, 2012). Thus, ecobee has been well aware since the very beginning of
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`the district court litigation that EcoFactor could continue to assert the ‘550 patent.
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`Despite this knowledge, ecobee chose to delay filing its IPR petition.
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`Moreover, this delay is inexcusable particularly since Petitioner submitted
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`initial invalidity contentions in the district court case almost two months before (on
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`March 17, 2022) it filed the Petition here, asserting the same Ehlers, Ols, and Boait
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`references as relied upon here. Ex. 2004, Ecobee’s Disclosure of Initial Invalidity
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`Conte