Trials@uspto.gov
`571-272-7822
`
`Paper 11
`Entered: February 2, 2021
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`CODE200, UAB; TESO LT, UAB; METACLUSTER LT, UAB;
`AND OXYSALES, UAB,
`Petitioner,
`v.
`LUMINATI NETWORKS LTD.,
`Patent Owner.
`
`IPR2020-01358
`Patent 10,484,510 B2
`
`Before THOMAS L. GIANNETTI, SHEILA F. McSHANE, and
`RUSSELL E. CASS, Administrative Patent Judges.
`
`McSHANE, Administrative Patent Judge.
`
`DECISION
`Denying Institution of Inter Partes Review
`35 U.S.C. § 314
`
`Code200, UAB v. Bright Data Ltd.
`Code 200's Exhibit 1068
`Page 1 of 12
`
`
`571-272-7822
`
`Paper 11
`Entered: February 2, 2021
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`CODE200, UAB; TESO LT, UAB; METACLUSTER LT, UAB;
`AND OXYSALES, UAB,
`Petitioner,
`v.
`LUMINATI NETWORKS LTD.,
`Patent Owner.
`
`IPR2020-01358
`Patent 10,484,510 B2
`
`Before THOMAS L. GIANNETTI, SHEILA F. McSHANE, and
`RUSSELL E. CASS, Administrative Patent Judges.
`
`McSHANE, Administrative Patent Judge.
`
`DECISION
`Denying Institution of Inter Partes Review
`35 U.S.C. § 314
`
`Code200, UAB v. Bright Data Ltd.
`Code 200's Exhibit 1068
`Page 1 of 12
`
`
`
`IPR2020-01358
`Patent 10,484,510 B2
`
`INTRODUCTION
`I.
`Background and Summary
`A.
`Code200, UAB, Teso LT, UAB, Metacluster LT, UAB, and Oxysales,
`UAB (“Code200” or “Petitioner”)1 filed a Petition requesting inter partes
`review of claims 1, 2, 6–11, 13, and 15–24 of U.S. Patent No. 10,484,510
`B2 (Ex. 1001, “the ’510 patent”) pursuant to 35 U.S.C. §§ 311–319, along
`with the supporting Declaration of Michael Freedman, Ph. D. Paper 5
`(“Pet.”); Ex. 1009. Luminati Networks Ltd. (“Luminati” or “Patent Owner”)
`filed a Preliminary Response to the Petition. Paper 9 (“Prelim. Resp.”).
`We have authority under 35 U.S.C. § 314(a), which provides that an
`inter partes review may not be instituted “unless . . . the information
`presented in the petition . . . shows that there is a reasonable likelihood that
`the petitioner would prevail with respect to at least 1 of the claims
`challenged in the petition.”
`For the reasons that follow, we exercise our discretion under 35
`U.S.C. § 314(a) to deny institution of inter partes review.
`Related Matters
`B.
`The parties identify the related litigations, Luminati Networks Ltd. v.
`Teso LT, UAB et al., 2:19-cv-00395-JRG (E.D. Tex.) (“the 395 district court
`case”) and Luminati Networks Ltd. v. Tefincom S.A. D/B/A NordVPN, 2:19-
`cv-00414-JRG (E.D. Tex.). Pet. 2; Paper 6, 2.
`The parties also note another petition has been filed in IPR2020-
`01266, which is directed to U.S. Patent No. 10,257,319, which claims the
`
`1 Petitioner additionally identifies coretech lt, UAB as a real party-in-
`interest. Pet. 2.
`
`2
`
`Code200, UAB v. Bright Data Ltd.
`Code 200's Exhibit 1068
`Page 2 of 12
`
`
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`IPR2020-01358
`Patent 10,484,510 B2
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`benefit of the same provisional application, and is a continuation of the same
`application, as the ’510 patent. Pet. 2; Paper 6, 2.
`C.
`The ’510 Patent
`The ’510 patent is titled “System Providing Faster and More Efficient
`Data Communication” and issued on November 19, 2019, from an
`application filed on February 17, 2019. Ex. 1001, codes (22), (45), (54).
`The application for the ’510 patent is a continuation of several applications,
`and other related applications include a divisional application and a
`provisional application. See id., code (60). The ’510 patent is subject to a
`terminal disclaimer. Id., code (*).
`The ’510 patent is directed to a system and method for increasing
`network communication speed for users, while lowering network congestion
`for content owners and internet service providers (ISPs). Ex. 1001, code
`(57). The system employs network elements including an acceleration
`server, clients, agents, and peers, where communication requests generated
`by applications are intercepted by the client on the same machine. Id. The
`IP address of the server in the communication request is transmitted to the
`acceleration server, which provides a list of agents to use for this IP address.
`Id.
`
`The communication request is sent to the agents. Ex. 1001, code (57).
`One or more of the agents respond with a list of peers that have previously
`seen some or all of the content which is the response to this request (after
`checking whether this data is still valid). Id. The client then downloads the
`data from these peers in parts and in parallel, thereby speeding up the Web
`transfer, releasing congestion from the Web by fetching the information
`
`3
`
`Code200, UAB v. Bright Data Ltd.
`Code 200's Exhibit 1068
`Page 3 of 12
`
`
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`IPR2020-01358
`Patent 10,484,510 B2
`
`from multiple sources, and relieving traffic from Web servers by offloading
`the data transfers from them to nearby peers. Id.
`Challenged claim 1 is the only independent claim. Claim 1 of the
`’510 patent is reproduced below.
`1. A method for use with a web server that responds to
`Hypertext Transfer Protocol (HTTP) requests and stores a first content
`identified by a first content identifier, the method by a first client
`device comprising:
`establishing a Transmission Control Protocol (TCP) connection
`with a second server;
`sending, to the web server over an Internet, the first content
`identifier;
`receiving, the first content from the web server over the Internet
`in response to the sending of the first content identifier; and
`sending the received first content, to the second server over the
`established TCP connection, in response to the receiving of the first
`content identifier.
`Ex. 1001, 19:18–31.
`D.
`Asserted Grounds of Unpatentability
`Petitioner challenges the patentability of claims of the ’510 patent on
`the following grounds:
`Claims Challenged
`1, 2, 6, 7, 15, 16, 18–
`23
`
`Reference(s)
`
`35 U.S.C. §
`102(b)2
`
`Crowds3
`
`
`2 The Leahy-Smith America Invents Act (“AIA”), Pub. L. No. 112-29, 125
`Stat. 284, 287–88 (2011), amended 35 U.S.C. § 103, effective March 16,
`2013. Because the ’510 patent claims priority to a provisional application
`that was filed before this date, with Petitioner not contesting that priority, the
`pre-AIA versions of §§ 102, 103 apply. See Ex. 1001, code (60); Pet. 12.
`3 Michael K. Reiter, Crowds: Anonymity for Web Transactions, ACM
`Transactions on Information and System Security, Vol. 1, No. 1, November
`1998, at 66–92 (Ex. 1011).
`
`4
`
`Code200, UAB v. Bright Data Ltd.
`Code 200's Exhibit 1068
`Page 4 of 12
`
`
`
`IPR2020-01358
`Patent 10,484,510 B2
`
`
`Claims Challenged
`1, 2, 6–11, 13,
`15, 16, 18–23
`1, 6, 10, 15–20, 23,
`24
`1, 6, 8–11, 13, 15–20,
`22–24
`1, 2, 6–8, 13, 15, 16,
`18–23
`1, 2, 6–11, 13, 15, 16,
`18–23
`Pet. 15–16.
`
`35 U.S.C. §
`103(a)
`
`Reference(s)
`Crowds, RFC 26164
`
`102(b)
`
`103(a)
`
`102(b)
`
`103(a)
`
`Border5
`
`Border, RFC 2616
`
`MorphMix6
`
`MorphMix, RFC 2616
`
`II. DISCRETIONARY DENIAL UNDER § 314(a)
`A. Overview
`
`Patent Owner requests that we exercise our discretion under 35 U.S.C.
`
`§ 314(a) to deny the Petition under Apple Inc. v. Fintiv, Inc., IPR2020-
`00019, Paper 11 (PTAB Mar. 20, 2020) (precedential) (“Fintiv”). Prelim.
`Resp. 4–16.
`
`In assessing whether to exercise such discretion, the Board weighs the
`following factors:
`1. whether the court granted a stay or evidence exists that one
`may be granted if a proceeding is instituted;
`2. proximity of the court’s trial date to the Board's projected
`statutory deadline for a final written decision;
`3. investment in the parallel proceeding by the court and the
`parties;
`
`
`4 Hypertext Transfer Protocol—HTTP/1.1, Network Working Group, RFC
`2616, The Internet Society, 1999 (Ex. 1018).
`5 U. S. Patent No. 6,795,848, issued September 21, 2004 (Ex. 1017).
`6 Marc Rennhard, MorphMix—A Peer-to-Peer-based System for
`Anonymous Internet Access (2004) (Ph.D. dissertation, Swiss Federal
`Institute of Technology) (Ex. 1013).
`
`5
`
`Code200, UAB v. Bright Data Ltd.
`Code 200's Exhibit 1068
`Page 5 of 12
`
`
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`IPR2020-01358
`Patent 10,484,510 B2
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`
`4. 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
`6. other circumstances that impact the Board’s exercise of
`discretion, including the merits.
`Fintiv at 6. Recognizing that “there is some overlap among these factors”
`and that “[s]ome facts may be relevant to more than one factor,” the Board
`“takes a holistic view of whether efficiency and integrity of the system are
`best served by denying or instituting review.” Id.
`
`As identified above, the 395 district court case, which involves the
`’510 patent, is pending in the Eastern District of Texas. See Pet. 2; Paper 6,
`2; Prelim. Resp. 4–5. The 395 district court case has a Docket Control Order
`entered that set December 14, 2020, as the deadline for completing fact
`discovery, January 21, 2021, as the deadline for completing expert
`discovery, and May 3, 2021, for jury selection and trial. Ex. 1004, 1, 3. The
`parties have advised us that the date for jury selection has been moved to
`May 10, 2021. The Court has conducted a claim construction hearing, and
`on December 7, 2020, issued a Claim Construction Opinion and Order.
`Paper 10; Ex. 2017.
`
`Petitioner advised us that the presiding judge in the 395 district court
`case, Judge Gilstrap, has continued jury trial dates in other cases scheduled
`for trial from December 2020 through February 2021, due to the COVID-19
`pandemic. See Ex. 3001. We have not, however, been informed of any
`change in the May 10, 2021 jury selection date in the 395 district court case.
`
`We address each Fintiv factor below.
`
`6
`
`Code200, UAB v. Bright Data Ltd.
`Code 200's Exhibit 1068
`Page 6 of 12
`
`
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`IPR2020-01358
`Patent 10,484,510 B2
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`
`B. Factor 1 – Stay of Related Litigation Proceeding
`Petitioner filed a motion to stay the 395 district court case, which was
`
`denied without prejudice as premature because it was filed in advance of the
`Board’s decision to institute inter partes reviews on any of the asserted
`patents in the litigation.7 Ex. 2015, 3. Although the district court denied the
`motion without prejudice, with refiling permitted within 24 days of the
`Board’s institution decisions for the asserted patents, Patent Owner argues
`that the District Court has not indicated one way or the other whether a stay
`is likely to be granted at that time. Prelim. Resp. 6–7.
`
`Because the Board has previously “decline[d] to infer” how a District
`Court would decide a stay motion, Petitioner asserts that this factor is
`neutral. Pet. 7 (quoting Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 15
`at 12 (PTAB May 13, 2020) (informative)). Patent Owner argues that
`because the District Court has not granted a stay and “would not likely grant
`a stay given the lateness of the Petition, this factor favors denial of
`institution.” Prelim Resp. 7.
`
`We decline to speculate on the likelihood of how the District Court
`may rule on a future motion to stay. Accordingly, we find that this factor is
`neutral.
`
`C. Factor 2 — Proximity of Court’s Trial Date
`
`Patent Owner argues that the Petition should be denied because jury
`selection in the 395 district court case is scheduled approximately nine
`months before a final determination would issue in this case. Prelim. Resp.
`4, 7–10.
`
`
`7 Three patents, the ’510 patent as well as U.S. Patent Nos. 10,469,614 and
`10,257,319, are asserted in the 395 district court case. Ex. 2015, 1.
`
`7
`
`Code200, UAB v. Bright Data Ltd.
`Code 200's Exhibit 1068
`Page 7 of 12
`
`
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`IPR2020-01358
`Patent 10,484,510 B2
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`Petitioner alleges that Patent Owner has previously sought to delay
`
`trials as the set trial date approaches. Pet. 7 (referring to Luminati Networks
`Ltd. v. UAB Tesonet, No. 2:18-cv-00299-JRG (E.D. Tex.)). Petitioner
`argues that in light of Patent Owner’s history and the potential for COVID-
`related delays, Factor 2 is neutral. Id. at 8. Patent Owner responds that the
`previous litigation has been misrepresented by Petitioner, and instead Patent
`Owner filed a motion to consolidate the referenced case with another case to
`accelerate the date by which the ’510 patent infringement claims could be
`tried. Prelim. Resp. 7.
`
`As mentioned above, Petitioner additionally brings to our attention
`Judge Gilstrap’s Order to continue jury trials from December 2020 through
`February of 2021, but the communication notes that Petitioner does not
`know what impact the continuances may have on the trial date in this case.
`See Ex. 3001. Patent Owner asserts that the Judge Gilstrap’s Order does not
`impact the schedule for trial in the case, and “no other facts can be inferred
`from the Order.” Id.
`
`As Patent Owner asserts, the related jury trial in the 395 district court
`case is currently scheduled to occur approximately nine months before a
`final determination would issue in this case. Although there may be a delay
`in the trial date, presuming that there would be delay would be conjecture at
`this time. Accordingly, this factor favors discretionary denial of inter partes
`review.
`
`D. Factor 3 — Investment in the Parallel Proceeding
`
`Petitioner notes that this Petition was filed less than three months after
`the asserted claims were disclosed in the 395 district court case. Pet. 8.
`However, it is undisputed that at this time that claim construction briefing
`
`8
`
`Code200, UAB v. Bright Data Ltd.
`Code 200's Exhibit 1068
`Page 8 of 12
`
`
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`IPR2020-01358
`Patent 10,484,510 B2
`
`has been completed, a Markman hearing was conducted, and a claim
`construction order issued in the 395 district court case, which includes
`interpretation of claim terms associated with the ’510 patent. See Ex. 2016.
`Under the Docket Control Order, fact discovery in that case was completed
`on December 14, 2020, and expert discovery was completed on January 21,
`2021. See Ex. 1004, 1, 3. The parties have not advised us of any changes to
`those dates as scheduled.
`
`Accordingly, in view of the status of the progress of the 395 district
`court case, we agree with Patent Owner that this factor favors denial of
`institution of inter partes review. See Prelim. Resp. 12.
`E. Factor 4 — Overlap With Issues Raised in Parallel Proceeding
`
`
`Petitioner asserts that because claims 1, 2, 8–11, 13, 15, 16, 18–20,
`22, and 23 are asserted in the 395 district court case, but the Petition also
`challenges claims 6, 7, 17, 21, and 24 of the ’510 patent, this factor weighs
`in favor of institution. Pet. 8.
`
`Patent Owner argues that the overlap of the issues raised in Petition
`and the 395 district court case are substantial. Prelim Resp. 12. More
`specifically, Patent Owner contends that the Crowds, MorphMix, Border,
`and RFC 2616 prior art asserted in the challenges in this proceeding are all
`identified in the invalidity contentions in the 395 district court case. Id.
`(citing Ex. 2006, ¶¶ 3–4). Patent Owner also asserts that only claim 1 of the
`’510 patent is independent, and the additional claims challenged in the
`Petition are all dependent. Id. at 12–13. As such, Patent Owner argues that
`there is no other independent claim at issue here that is not asserted in the
`district court case, and the resolution of the patentability of independent
`
`9
`
`Code200, UAB v. Bright Data Ltd.
`Code 200's Exhibit 1068
`Page 9 of 12
`
`
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`IPR2020-01358
`Patent 10,484,510 B2
`
`claim 1 in the district court is also likely to have an impact on the additional
`dependent claims challenged here. Id. at 13.
`
`In light of the common prior art asserted here and in the 395 district
`court case, as well as the common challenge to the sole independent claim of
`the ’510 patent, we agree with the Patent Owner that the overlap in issues
`between the two proceedings is substantial. Accordingly, we determine that
`this factor favors denial of institution of inter partes review.
`
`F. Factor 5 — Commonality of Parties in Parallel Proceedings
`
`Petitioner asserts that Code200 is a named petitioner here, but is not a
`defendant in the 395 district court case. Pet. 9. Patent Owner argues that
`three of the four named petitioners are also defendants in the 395 district
`court case. PO Resp. 13. Patent Owner also asserts that there is a close
`corporate relationship between Code200 and the other petitioners because
`they share a common parent company. Id. at 14 (citing Ex. 2013, Ex. 2014).
`Petitioner does not challenge this contention.
`
`Given the commonality of most of the parties in this proceeding and
`395 district court case, we find that this factor favors denial of institution.
`G. Factor 6 — Other Circumstances
`
`
`Petitioner contends that the challenged patent is “extraordinarily
`weak,” and policy favors instituting review under these circumstances. Pet.
`9. Patent Owner disagrees, arguing that Petitioner’s reading of the claims is
`unreasonable and the asserted prior art is weak. Prelim. Rep. 15–16.
`
`We have reviewed Petitioner’s unpatentability arguments and Patent
`Owner’s preliminary responses, and based on the limited record before us,
`we do not find that the merits outweigh the other Fintiv factors favoring
`denial of institution.
`
`10
`
`Code200, UAB v. Bright Data Ltd.
`Code 200's Exhibit 1068
`Page 10 of 12
`
`
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`IPR2020-01358
`Patent 10,484,510 B2
`
`
`H. Conclusion
`The majority of the Fintiv factors, and particularly factor 2, the
`
`proximity of the trial date in the 395 district court case, favor the denial of
`institution. Thus, based on our assessment of the Fintiv factors, we exercise
`our discretion under 35 U.S.C. § 314(a) to deny inter partes review.
`
`III. ORDER
`
`Accordingly, it is:
`ORDERED that the Petition is denied as to all grounds and all
`challenged claims of the ’510 patent.
`
`11
`
`Code200, UAB v. Bright Data Ltd.
`Code 200's Exhibit 1068
`Page 11 of 12
`
`
`
`IPR2020-01358
`Patent 10,484,510 B2
`
`For PETITIONER:
`
`Craig Tolliver
`George Scott
`CHARHON, CALLAHAN, ROBSON & GARZA, PLLC
`ctolliver@tolliverlawfirm.com
`jscott@ccrglaw.com
`
`For PATENT OWNER:
`
`Thomas Dunham
`Don Livornese
`RUYAKCHERIAN LLP
`tomd@dunham.cc
`donl@ruyakcherian.com
`
`12
`
`Code200, UAB v. Bright Data Ltd.
`Code 200's Exhibit 1068
`Page 12 of 12
`
`
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