UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`APPLE INC.,
`
`PETITIONER,
`
`CERTIFIED COPY
`
`FINITIV,
`
`INC.,
`
`Patent Owner.
`
`Job Number 23-131161
`
`Case IPR2023-00399 (US Patent No. 9,208, 488)
`
`Case IPR2023-00398 (US Patent No. 10, 438,196)
`
`VIDEOCONFERENCE DEPOSITION OF
`
`KAI JOHNSON
`
`December 15, 2023
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`Page 1 —- 67
`
`9:01 a.m. — 11:07 a.m.
`
`REPORTED BY:
`Tamara L. Houston
`
`CA CSR No. 7244, RPR, CCRR No. 140
`
`S THE SULLIVAN GROUP
`
`OF COURT REPORTERS
`SULLIVANCOURTREPORTERS.COM
`PHONE 562.888.6488
`
`APPL-1023 / IPR2023-00398
`APPLEINC.v. FINTIV,INC. / Page 1 of 83
`
`APPL-1023 / IPR2023-00398
`APPLE INC. v. FINTIV, INC. / Page 1 of 83
`
`
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`APPLE INC.,
`
`PETITIONER,
`
`CERTIFIED COPY
`
`FINITIV,
`
`INC.,
`
`Patent Owner.
`
`Job Number 23-131161
`
`Case IPR2023-00399 (US Patent No. 9,208, 488)
`
`Case IPR2023-00398 (US Patent No. 10, 438,196)
`
`VIDEOCONFERENCE DEPOSITION OF
`
`KAI JOHNSON
`
`December 15, 2023
`
`Page 1 —- 67
`
`9:01 a.m. — 11:07 a.m.
`
`REPORTED BY:
`Tamara L. Houston
`
`CA CSR No. 7244, RPR, CCRR No. 140
`
`S THE SULLIVAN GROUP
`
`OF COURT REPORTERS
`SULLIVANCOURTREPORTERS.COM
`PHONE 562.888.6488
`
`APPL-1023 / IPR2023-00398
`APPLEINC.v. FINTIV,INC. / Page 1 of 83
`
`APPL-1023 / IPR2023-00398
`APPLE INC. v. FINTIV, INC. / Page 1 of 83
`
`
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`· · · UNITED STATES PATENT AND TRADEMARK OFFICE
`
`· · · ·BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`_____________________________________________________
`
`· · · · · · · · · · ·APPLE INC.,
`
`· · · · · · · · · · ·PETITIONER,
`
`· · · · · · · · · · · · · · · · · · V.
`
`· · · · · · · · · · FINITIV, INC.,
`
`· · · · · · · · · · Patent Owner.
`_____________________________________________________
`
`· · Case IPR2023-00399 (US Patent No. 9,208,488)
`
`· · Case IPR2023-00398 (US Patent No. 10,438,196)
`_____________________________________________________
`
`· · · · · · VIDEOCONFERENCE DEPOSITION OF
`
`· · · · · · · · · · ·KAI JOHNSON
`
`· · · · · · · · · December 15, 2023
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`· · · ·Page 1 - 67· · · · 9:01 a.m. - 11:07 a.m.
`
`REPORTED BY:
`Tamara L. Houston
`CA CSR No. 7244, RPR, CCRR No. 140
`Job Number 23-131161
`
`APPL-1023 / IPR2023-00398
`APPLE INC. v. FINTIV, INC. / Page 2 of 83
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`·1
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`·2
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`·3
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`·4· · · · ·REMOTE VIDEOCONFERENCE DEPOSITION OF KAI
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`·5· ·JOHNSON, taken on behalf of the Petitioner,
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`·6· ·commencing from 9:01 a.m. to 11:07 a.m., Friday,
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`·7· ·December 15, 2023, before Tamara L. Houston, CSR No.
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`·8· ·7244, CCRR, RPR.
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`APPL-1023 / IPR2023-00398
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`·1· ·APPEARANCE OF COUNSEL:
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`·2
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`·3· · · · On behalf of the Petitioner:
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`·4· · · · · · ·HAYNES BOONE
`· · · · · · · ·BY:· JORDAN M. MAUCOTEL
`·5· · · · · · ·6000 Headquarters Drive
`· · · · · · · ·Suite 200
`·6· · · · · · ·Plano, TX 75024
`· · · · · · · ·(972) 739-6900
`·7· · · · · · ·jordan.maucotel@haynesboone.com
`
`·8· · · · · · ·HAYNES BOONE
`· · · · · · · ·BY:· EUGENE GORYUNOV
`·9· · · · · · ·180 North LaSalle Street
`· · · · · · · ·Suite 2215
`10· · · · · · ·Chicago, IL 60601
`· · · · · · · ·(312) 216-1630
`11· · · · · · ·eugene.goryunov@HaynesBoonecom
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`12
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`13· · · · On behalf of the Patent Owner and Witness:
`
`14· · · · · · ·VOLPE KOENIG
`· · · · · · · ·BY:· DANIEL H. GOLUB
`15· · · · · · ·30 South 17th Street, 18th Floor
`· · · · · · · ·Philadelphia, PA 19103-4005
`16· · · · · · ·(215) 255-9194
`· · · · · · · ·dgolub@vklaw.com
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`APPL-1023 / IPR2023-00398
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`·1· · · · · · · · · ·INDEX TO EXAMINATION
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`·2· · · · · · · · · WITNESS: KAI JOHNSON
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`·3· ·EXAMINATIONS· · · · · · · · · · · · · · · · · · · PAGE
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`·4· ·MR. MAUCOTEL.....................................· · 6
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`·5
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`·6
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`·7· · · · · · QUESTIONS INSTRUCTED NOT TO ANSWER
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`·8· · · · · · · · · · · Page· · ·Line
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`·9· · · · · · · · · · · · · ·None
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`APPL-1023 / IPR2023-00398
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`·1· · · · · · · · · · ·INDEX TO EXHIBITS
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`·2· · · · · · · · · · · · KAI JOHNSON
`
`·3· · · · · · · ·APPLE, INC. vs. FINTIVE, INC.
`
`·4· · · · · · · · · · ·December 15, 2023
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`·5· · · Tamara L. Houston, CSR No. 7244, CRR No. 140, RPR
`
`·6
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`·7· ·EXHIBIT· · · · · · · DESCRIPTION· · · · · · · · · ·PAGE
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`·8· · · · · · · · · · · · · ·None.
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`·9· · · · · · · · · · · · · --o0o--
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`APPL-1023 / IPR2023-00398
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`·1· · · · · · ·Friday, December 15, 2023, 9:01 a.m.
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`·2· · · · · · · · · · · · · ·--o0o--
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`·3· · · · · · · · · · Whereupon, KAI JOHNSON, having been
`
`·4· · · · · · · · · · called as a witness was duly sworn
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`·5· · · · · · · · · · to tell the truth, the whole truth,
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`·6· · · · · · · · · · and nothing but the truth testified
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`·7· · · · · · · · · · as follows:
`
`·8· · · · · · · · · · · · · · --o0o--
`
`·9· · · · · · · · EXAMINATION BY MR. MAUCOTEL:
`
`10· · · · Q.· ·Okay.· My name is Jordan Maucotel. I
`
`11· ·represent Petitioner Apple in the IPRs, 2023-00398 and
`
`12· ·IPR 2023-00399.
`
`13· · · · · · ·Could you, please, state your name for the
`
`14· ·record?
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`15· · · · A.· ·My name is Kai Johnson.
`
`16· · · · Q.· ·Great.· Thank you, Mr. Johnson.
`
`17· · · · · · ·Have you been deposed before?
`
`18· · · · A.· ·I have.
`
`19· · · · Q.· ·How many times?
`
`20· · · · A.· ·Two times previously.
`
`21· · · · Q.· ·And how recently were these?
`
`22· · · · A.· ·Last one was about a year ago, and the one
`
`23· ·prior, oh, more than a couple years back.
`
`24· · · · Q.· ·Okay.· For the one most recently, what -- what
`
`25· ·kind of deposition was that?
`
`APPL-1023 / IPR2023-00398
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`·1· · · · A.· ·It was a deposition in relation to a patent
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`·2· ·matter and specifically in relation to a declaration in
`
`·3· ·support of claim construction.
`
`·4· · · · Q.· ·Okay.· So it's fair to say that you've --
`
`·5· ·you've done this before, kind of understand the
`
`·6· ·structure?· Would that be --
`
`·7· · · · A.· ·Yeah, I suppose so.
`
`·8· · · · Q.· ·Okay.· Great.· So if I -- if I ask you a
`
`·9· ·question and you answer it, it's fair to assume that you
`
`10· ·understood the question?
`
`11· · · · A.· ·Yes.
`
`12· · · · Q.· ·Okay.· And if you didn't understand it, feel
`
`13· ·free to say that, and I'll -- I'll go ahead and repeat
`
`14· ·the question.
`
`15· · · · A.· ·Okay.
`
`16· · · · Q.· ·And we'll take breaks about every hour, if you
`
`17· ·need a break, or we're flexible.· Let me know.
`
`18· · · · · · ·Is there any reason you cannot provide
`
`19· ·truthful, complete, and full testimony today?
`
`20· · · · A.· ·No.· I'm gonna ask, though, that -- your audio
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`21· ·is a little quiet.
`
`22· · · · Q.· ·I'll turn that up.· Is that louder?
`
`23· · · · A.· ·Not quite yet.
`
`24· · · · Q.· ·My microphone -- okay.· I'll try to speak up
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`25· ·and see if I can be a little bit louder.· Is that
`
`APPL-1023 / IPR2023-00398
`APPLE INC. v. FINTIV, INC. / Page 8 of 83
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`·1· ·better?
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`·2· · · · A.· ·A little bit.· Let me see if I can -- no, I
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`·3· ·don't have more volume on my end.
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`·4· · · · · · ·COURT REPORTER:· It's a little bit light on my
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`·5· ·end too.
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`·6· · · · · · ·THE WITNESS:· Okay.· Should be workable, but
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`·7· ·at first, if it's unclear, I'll just ask.
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`·8· ·BY MR. MAUCOTEL:
`
`·9· · · · Q.· ·Okay.· I'm going to try to turn up my
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`10· ·microphone a bit.· Any better or about the same?
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`11· · · · A.· ·Yeah, that's a little better.· Thank you.
`
`12· · · · Q.· ·Great.· Let's go ahead -- so it's my
`
`13· ·understanding that you submitted declarations an both
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`14· ·the IPR 2023-00398 and IPR 2023-00399; is that correct?
`
`15· · · · A.· ·Yes.
`
`16· · · · Q.· ·Is it fair to say that these declarations are
`
`17· ·substantially similar?
`
`18· · · · A.· ·Yes, they are.
`
`19· · · · Q.· ·Okay.· And I'll refer to the '196 and the '488
`
`20· ·patents.· You understand those terms, those patent
`
`21· ·numbers?
`
`22· · · · A.· ·Yes.
`
`23· · · · Q.· ·So the questions that I ask will be equally
`
`24· ·applicable to the '196 or the '488 patent unless there's
`
`25· ·some difference between them.· Great.
`
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`·1· · · · · · ·Let's go ahead and turn to -- do you have a
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`·2· ·copy of your declaration before you for these two cases?
`
`·3· · · · A.· ·I do.
`
`·4· · · · Q.· ·Okay.· Is that a printed copy or on your
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`·5· ·computer?
`
`·6· · · · A.· ·On the computer.
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`·7· · · · Q.· ·Okay.· Are there annotations on that copy, or
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`·8· ·is it a clean copy?
`
`·9· · · · A.· ·No, it's a clean copy.
`
`10· · · · Q.· ·Great.· Let's go ahead and turn to paragraph
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`11· ·23, and I'm going to use the numbers for the '196
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`12· ·patent; but, again, the material should be substantially
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`13· ·similar between your declarations.
`
`14· · · · · · ·MR. GOLUB:· Counsel, just for clarity, are you
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`15· ·asking him about his declaration in the '398 IPR right
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`16· ·now or the '399?
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`17· · · · · · ·MR. MAUCOTEL:· The '398 right now.
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`18· · · · · · ·MR. GOLUB:· '398, okay.
`
`19· ·BY MR. MAUCOTEL:
`
`20· · · · Q.· ·Is it fair to say -- since we are kind of
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`21· ·combining these two declarations and discussing these
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`22· ·two declarations together, is it fair to say that your
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`23· ·testimony for these two declarations will be the same?
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`24· · · · A.· ·I suppose so to the extent that we're -- we're
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`25· ·talking about the same thing.· So certainly there are
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`·1· ·some differences between the '196 and '488 patents.
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`·2· · · · Q.· ·Great.· That's great.· If there's a difference
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`·3· ·that you want to point out, that's -- that's fine.· You
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`·4· ·can point out any differences you see between them.
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`·5· · · · A.· ·Sure.
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`·6· · · · Q.· ·All right.· Let's turn to paragraph 23 of
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`·7· ·the -- of your declaration for the '196 patent.· And in
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`·8· ·this paragraph, you're quoting the board.· This is the
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`·9· ·start of the large paragraph on -- within paragraph 23
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`10· ·of the '196 patent.· And it says, "For purposes of this
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`11· ·decision, we determine a person of ordinary skill in the
`
`12· ·art would have had a working knowledge of mobile payment
`
`13· ·systems and techniques."
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`14· · · · · · ·Do you agree with that statement from the
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`15· ·board?
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`16· · · · A.· ·Yes.
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`17· · · · Q.· ·What do you understand is a working knowledge
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`18· ·of mobile payment systems and techniques?
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`19· · · · A.· ·Well, indeed -- I actually suggested in the
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`20· ·declaration that we add some clarification to that
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`21· ·because the realm of mobile payment systems is broad,
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`22· ·and it includes quite a number of things, some of which
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`23· ·are related to the patents and some of which are not.
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`24· · · · · · ·So a person of skill in the art would have
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`25· ·knowledge of things that are related to the patent,
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`·1· ·specifically knowledge of mobile wallets.
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`·2· · · · · · · · · (Court Reporter requested clarification.)
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`·3· ·BY MR. MAUCOTEL:
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`·4· · · · Q.· ·So in your opinion, do mobile payment systems
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`·5· ·include mobile wallets?
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`·6· · · · A.· ·Yes.
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`·7· · · · Q.· ·And what is your definition of a mobile
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`·8· ·wallet?
`
`·9· · · · A.· ·A mobile wallet is a broad class of things
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`10· ·that includes a variety of different types of mobile
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`11· ·applications and services that are broadly used to --
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`12· ·either to complete payment transaction, store payment
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`13· ·information, provide access to payment accounts, or even
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`14· ·collect things that are secondarily related to payments,
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`15· ·such as coupons or loyalty cards.· The term is used
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`16· ·relatively broadly in the industry for a variety of
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`17· ·different things.
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`18· · · · Q.· ·Within the context of the '196 patent or the
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`19· ·'488 patent, is mobile wallet defined differently than
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`20· ·the definition you just gave or the same?
`
`21· · · · A.· ·Oh, there may be an explanation of that in the
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`22· ·patents.· I don't recall exactly.· I'd have to go look.
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`23· · · · Q.· ·Okay.· Let's turn to -- let's turn to
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`24· ·paragraph 24 of the declaration.
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`25· · · · A.· ·Mm-hmm.
`
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`·1· · · · Q.· ·Would you go ahead and read the second
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`·2· ·sentence of that paragraph?
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`·3· · · · A.· ·Beginning with the POSITA's --
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`·4· · · · Q.· ·Yes, sorry.· I was just looking for that.
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`·5· · · · A.· ·Sure.· "The POSITA's working knowledge of
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`·6· ·'mobile payment systems and techniques' should
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`·7· ·specifically include a working knowledge of 'mobile
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`·8· ·wallets' because the claims of the '196 patent are
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`·9· ·directed to mobile wallets."
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`10· · · · Q.· ·How would you define a working knowledge of
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`11· ·mobile wallets?
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`12· · · · A.· ·That's an understanding of the architecture
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`13· ·and operation of mobile wallet systems of various types.
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`14· ·And as I said, it's a rather broad category.
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`15· · · · Q.· ·Is that working knowledge gained through
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`16· ·experience, work experience?
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`17· · · · A.· ·That's one way it could be gained, yes.
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`18· · · · Q.· ·What's another way that it could be gained?
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`19· · · · A.· ·Through -- through research in the area,
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`20· ·through academic study.
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`21· · · · Q.· ·Okay.· Do you believe that you have a working
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`22· ·knowledge of mobile wallets?
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`23· · · · A.· ·I do.
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`24· · · · Q.· ·And how is it that you gained that working
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`25· ·knowledge?
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`·1· · · · A.· ·Directly through work experience.
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`·2· · · · Q.· ·And which work experience is that you're
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`·3· ·referring to?
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`·4· · · · A.· ·Well, so it's a broad range of work
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`·5· ·experience.· Starting back in the early 2000s when I was
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`·6· ·working in the U.K. -- well, broadly in Europe, a number
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`·7· ·of my clients were financial institutions and telecom
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`·8· ·operators.· And, you know, some of the things that we
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`·9· ·were looking at with them were early forms of mobile
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`10· ·payments, early forms of mobile banking, and that would
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`11· ·include things that could be considered mobile wallets,
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`12· ·including ways of storing either payment credentials or
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`13· ·authentication mechanisms on mobile phones, including
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`14· ·using the SIM cards for cryptographic functions.
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`15· · · · · · ·Part of that led to a partnership between the
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`16· ·company I was working with at the time, Entrust, and
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`17· ·Nokia on service that would be used for authenticating
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`18· ·transactions from mobile phones specifically for
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`19· ·financial services.
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`20· · · · · · ·There were some other related activities such
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`21· ·as working with a bank in the U.K. on their mobile
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`22· ·banking applications including transaction services they
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`23· ·developed and some of the authentication mechanisms that
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`24· ·were associated with those.
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`25· · · · · · ·And then about 2004 I moved back to the U.S.
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`·1· ·and took a position as a consultant working with Verizon
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`·2· ·Wireless where I worked with them on a variety of 3G
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`·3· ·consumer data products.
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`·4· · · · · · ·But eventually I took on the responsibility
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`·5· ·for the -- the joint venture that Verizon Wireless was
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`·6· ·involved in with AT&T and T-Mobile and for part of the
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`·7· ·time with Sprint to develop contactless mobile payments.
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`·8· ·It's what you would think of today as Apple Pay or
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`·9· ·Google Pay.· We were some of the first people to be
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`10· ·developing that technology and bringing it to market in
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`11· ·the U.S.
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`12· · · · · · ·So I started taking that responsibility on
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`13· ·within Verizon Wireless from their product management
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`14· ·perspective and switched to the joint venture to take on
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`15· ·leadership of the technology organization where I was
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`16· ·directly responsible for building and directing the team
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`17· ·that -- that developed that mobile payment service;
`
`18· ·indeed, what you would think of exactly as a mobile
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`19· ·wallet where you could store credentials for your
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`20· ·various credit and debit cards in the mobile phone,
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`21· ·within the SIM card of the mobile phone, and use them to
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`22· ·make contactless payments at your typical payment
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`23· ·terminal, sort of ActivePay as we're familiar with now.
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`24· · · · · · ·So I worked on that for several years.· After
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`25· ·I left Softcard, I started consulting on my own and
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`·1· ·continued to work with clients in that space advising
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`·2· ·banks and payment networks, for example, in Europe on
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`·3· ·how to adapt contactless technology for -- for their own
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`·4· ·use, either working with the systems of Apple Pay and
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`·5· ·Google Pay or developing their own services.
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`·6· · · · Q.· ·So you mentioned quite a few different work
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`·7· ·experiences that you've had in that field.· Which of
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`·8· ·those experiences is the most relevant to mobile
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`·9· ·wallets?
`
`10· · · · A.· ·Well, the -- they're all relevant to mobile
`
`11· ·wallets.· And I think I probably left a few things out,
`
`12· ·but that's a broad range of experience that's all
`
`13· ·specific to this field.
`
`14· · · · Q.· ·Are mobile wallets always used in the context
`
`15· ·of payment systems?
`
`16· · · · A.· ·Sometimes the term gets applied, you know, to
`
`17· ·things that are associated with payments but not
`
`18· ·directly payments.· You know, for example, there are
`
`19· ·some mobile wallets -- some things that people would
`
`20· ·call mobile wallets that -- for example, store
`
`21· ·identification credentials or, you know, things like
`
`22· ·coupons or loyalty cards.· So not always.
`
`23· · · · Q.· ·Would you say in the industry those have a
`
`24· ·different name than mobile wallets, or are they known by
`
`25· ·the same -- by the same designation as mobile wallets?
`
`APPL-1023 / IPR2023-00398
`APPLE INC. v. FINTIV, INC. / Page 16 of 83
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`·1· · · · A.· ·Sorry.· That was unclear.· Could you repeat
`
`·2· ·the question?
`
`·3· · · · Q.· ·Those kind of differing mobile wallets that
`
`·4· ·don't have to do with payment systems necessarily, that
`
`·5· ·have to do with coupons or other information, are they
`
`·6· ·also known as mobile wallets in the industry?
`
`·7· · · · A.· ·Sometimes they are, yes.
`
`·8· · · · Q.· ·Is the -- is there an example that you have of
`
`·9· ·a payment system that does not include mobile wallets?
`
`10· · · · A.· ·Sure.· Your, you know, typical credit or debit
`
`11· ·card doesn't necessarily use a mobile wallet.· That
`
`12· ·would be a type of payment system.
`
`13· · · · Q.· ·Is there an example of a mobile wallet that's
`
`14· ·not used within a payment system?
`
`15· · · · A.· ·Let me see if I got a good one for you.
`
`16· ·There's -- what's the name of that software?· There was
`
`17· ·a -- I'm going to get the name wrong, but I think it was
`
`18· ·a name like Keychain or something like that.· It was
`
`19· ·essentially a way of collecting loyalty cards, and then
`
`20· ·you could display those loyalty cards using the bar code
`
`21· ·on a mobile phone.· I believe that would sometimes be
`
`22· ·called a mobile wallet.
`
`23· · · · Q.· ·Do those -- are those -- those loyalty cards,
`
`24· ·are those for the purpose of payment, or what's the
`
`25· ·function of a loyalty card in that context?
`
`APPL-1023 / IPR2023-00398
`APPLE INC. v. FINTIV, INC. / Page 17 of 83
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`·1· · · · A.· ·Oh, you know, so loyalty card is like the --
`
`·2· ·you know, for example, the card you get from your
`
`·3· ·grocery store that has a bar code on it.· They ask you
`
`·4· ·to swipe each time or, you know, present each time
`
`·5· ·you're going to make a purchase.
`
`·6· · · · · · ·And usually they use tricks like high-low
`
`·7· ·pricing to entice you to use that loyalty card where
`
`·8· ·the -- the regular list price of the item is
`
`·9· ·exorbitantly high, and the price, if you use the loyalty
`
`10· ·card, is reasonably low, or you might say, more normal.
`
`11· · · · · · ·And, of course, the -- the retailer gets --
`
`12· ·out of that gets the ability to associate your purchase
`
`13· ·history with -- you know, with your past behavior.· So
`
`14· ·that's -- that data is of great value to them.
`
`15· · · · Q.· ·Okay.· I'd like to turn to paragraph 24 of the
`
`16· ·same page, your declaration for the '196 patent.· The
`
`17· ·last full sentence of the page states, "There are types
`
`18· ·of mobile payment systems that are unrelated to mobile
`
`19· ·wallets such as wireless point-of-sale system used by a
`
`20· ·merchant to remotely accept credit card payments."
`
`21· · · · · · ·Do you see that statement?
`
`22· · · · A.· ·Yes.
`
`23· · · · Q.· ·Can you explain that -- that statement?
`
`24· · · · A.· ·Sure.· Yeah.· So we're talking about the
`
`25· ·context of mobile payment systems in general, and that's
`
`APPL-1023 / IPR2023-00398
`APPLE INC. v. FINTIV, INC. / Page 18 of 83
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`
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`·1· ·a broader topic.
`
`·2· · · · · · ·So, for example -- the example here is a
`
`·3· ·wireless point-of-sale system.· So that -- we even make
`
`·4· ·it a slightly more extreme example.· Let's say you're on
`
`·5· ·an airline flight and you'd like to purchase one of the
`
`·6· ·snacks from the cart when they come down the aisle. I
`
`·7· ·suppose it's possible that those terminals are online
`
`·8· ·today, but for the most part, they have not been -- they
`
`·9· ·have been offline.
`
`10· · · · · · ·It's -- it is a -- a mobile payment system of
`
`11· ·a sort because the -- the terminal that the -- the
`
`12· ·flight attendant is using to accept your card for that
`
`13· ·purchase is -- is a mobile device.· May or may not be
`
`14· ·corrected through the Internet, often is not.· And
`
`15· ·accepts the -- the card for payment.
`
`16· · · · · · ·Now, that is not particularly a mobile wallet.
`
`17· ·In fact, it doesn't really have anything to do with
`
`18· ·mobile wallets at all.· It's really just a point-of-sale
`
`19· ·system.· So it's a significantly different thing from
`
`20· ·mobile wallets, per se.
`
`21· · · · Q.· ·A point-of-sale system like that, you
`
`22· ·mentioned that it may not be connected through the
`
`23· ·Internet.· Does use of a mobile wallet always entail use
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`24· ·of the Internet to complete a transaction?
`
`25· · · · A.· ·No, not at all.
`
`APPL-1023 / IPR2023-00398
`APPLE INC. v. FINTIV, INC. / Page 19 of 83
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`·1· · · · Q.· ·Can you give an example of a mobile wallet
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`·2· ·that does not require use of the Internet to complete a
`
`·3· ·transaction?
`
`·4· · · · A.· ·Absolutely.· Mobile wallets like Apple Pay and
`
`·5· ·Google Pay do not require the use of Internet to
`
`·6· ·complete the transaction.· The interaction between the
`
`·7· ·mobile phone and the payment terminal is -- is directly
`
`·8· ·between those two devices, and it doesn't require any
`
`·9· ·external interactions.
`
`10· · · · Q.· ·Okay.· Are there point of -- wireless
`
`11· ·point-of-sale systems that can use these nonmobile
`
`12· ·wallet types of transactions as well as mobile wallet
`
`13· ·transactions?
`
`14· · · · A.· ·Sorry.· I'm not quite sure what you're asking.
`
`15· · · · Q.· ·Let me rephrase it.
`
`16· · · · · · ·Is there a mobile payment system that can use
`
`17· ·both nonmobile wallet transactions as well as mobile
`
`18· ·wallet transactions and accept both kinds?
`
`19· · · · A.· ·Sure.· Yeah, you know, that's commonly the
`
`20· ·case with the typical on -- every terminal you would
`
`21· ·find on the counter at a retail store could accept
`
`22· ·payments using ordinary credit or debit card or could
`
`23· ·accept payments using something like Apple Pay or Google
`
`24· ·Pay.
`
`25· · · · Q.· ·In the context -- you mentioned Apple Pay and
`
`APPL-1023 / IPR2023-00398
`APPLE INC. v. FINTIV, INC. / Page 20 of 83
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`
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`·1· ·Google Pay.· In that case, is -- is Apple Pay and Google
`
`·2· ·Pay -- does that refer to a -- a transaction using a
`
`·3· ·mobile wallet?
`
`·4· · · · A.· ·Sorry.· The last part of your question was
`
`·5· ·quiet.· Could you repeat it?
`
`·6· · · · Q.· ·Sure.· Do Apple Pay and Google Pay involve
`
`·7· ·transactions using mobile wallets?
`
`·8· · · · A.· ·Yes.· Yeah.
`
`·9· · · · Q.· ·In that case, where is the mobile wallet
`
`10· ·stored?
`
`11· · · · A.· ·Typically in those cases -- typically, I'm
`
`12· ·going to say in those cases the mobile wallet is stored
`
`13· ·on a mobile phone, or the mobile wallet credentials
`
`14· ·specifically are stored in a secure element in the
`
`15· ·mobile phone, which in the case of Apple Pay and Google
`
`16· ·Pay is likely embedded in the device.· It doesn't
`
`17· ·necessarily have to be that way, but yes.
`
`18· · · · Q.· ·Where is the value in the mobile wallet stored
`
`19· ·in the case of Google Pay or Apple Pay?
`
`20· · · · A.· ·I'm going to pass on Google Pay because they
`
`21· ·change their product plan so often that I have a hard
`
`22· ·time keeping up with them.
`
`23· · · · · · ·I can give you some examples, but I can't tell
`
`24· ·you for certain without going to look at what they are
`
`25· ·currently offering, what their -- what their plans are
`
`APPL-1023 / IPR2023-00398
`APPLE INC. v. FINTIV, INC. / Page 21 of 83
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`·1· ·like.
`
`·2· · · · · · ·But in regards to Apple Pay, the money is
`
`·3· ·stored in the bank.
`
`·4· · · · Q.· ·Is that typical of these kind of non-Internet
`
`·5· ·using mobile wallets, is the value is stored offsite
`
`·6· ·like in a bank?
`
`·7· · · · A.· ·You know, that's one way to do it.· That's not
`
`·8· ·the only way to do it.· There are absolutely
`
`·9· ·implementations where there is stored value on the
`
`10· ·device.
`
`11· · · · Q.· ·In the context of the '196 and '488 patents,
`
`12· ·the mobile wallets used there, do you have an
`
`13· ·understanding of where the value for those mobile
`
`14· ·wallets is stored?
`
`15· · · · A.· ·As I recall, it's stored in a variety of
`
`16· ·different places.· The patents provide a bunch of
`
`17· ·different options.· I suppose we could go back and have
`
`18· ·a look at it.
`
`19· · · · Q.· ·Sure.· Do you want to -- do you want to find
`
`20· ·an example of where the value is stored there?· I'll
`
`21· ·give you a moment to look it up, if you'd like.
`
`22· · · · A.· ·So I'm probably not going to be able to point
`
`23· ·you to all of the examples off the top of my head, but I
`
`24· ·can give you a couple examples.
`
`25· · · · · · ·Make sure we have the right references here.
`
`APPL-1023 / IPR2023-00398
`APPLE INC. v. FINTIV, INC. / Page 22 of 83
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`
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`·1· ·Okay.· So I guess this is the '192 [sic] patent, Column
`
`·2· ·1 starting around line 42, I guess through 51, is a list
`
`·3· ·of different types of accounts where value could be
`
`·4· ·stored in relation to the '192 -- sorry, am I saying
`
`·5· ·that right?· '196 patent.· And -- okay.· I'm not sure if
`
`·6· ·that's a comprehensive list.· I'd have to go back and
`
`·7· ·look at the rest of the specification to tell you that.
`
`·8· · · · Q.· ·So in that section that you're pointing to, it
`
`·9· ·looks like Column 1, lines 42 on, is the value in
`
`10· ·that -- in that context stored not in the mobile wallet
`
`11· ·but somewhere else?
`
`12· · · · · · ·MR. GOLUB:· I'd just like to make an objection
`
`13· ·here.· I've been pretty lenient in giving you kind of a
`
`14· ·long leash, but these questions are getting pretty far
`
`15· ·afield from Mr. Johnson's declaration, which is what
`
`16· ·he's here to be deposed upon.
`
`17· · · · · · ·MR. MAUCOTEL:· Understood.
`
`18· ·BY MR. MAUCOTEL:
`
`19· · · · Q.· ·In the context of the -- of mobile wallets --
`
`20· ·we'll turn back to this in just a minute.
`
`21· · · · · · ·In fact, let's go ahead and turn to paragraph
`
`22· ·25 of your declaration.
`
`23· · · · A.· ·Okay.
`
`24· · · · Q.· ·And this refers to the -- your experience with
`
`25· ·Softcard technology and that kind of contactless
`
`APPL-1023 / IPR2023-00398
`APPLE INC. v. FINTIV, INC. / Page 23 of 83
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`
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`·1· ·technology.· Could you explain how Softcard works?
`
`·2· · · · A.· ·Sure.· If you're familiar with Apple Pay and
`
`·3· ·Google Pay, you're familiar with what Softcard does or
`
`·4· ·did, I guess, at the time.· So just to put it in
`
`·5· ·context, Softcard is the joint venture between Verizon
`
`·6· ·Wireless, AT&T, and T-Mobile.· It was at one point
`
`·7· ·branded Isis, and the brand changed for obvious reasons.
`
`·8· · · · · · ·The way the Softcard worked is in the mobile
`
`·9· ·phone there's a SIM card, and in this particular case,
`
`10· ·case of Softcard's customers, that SIM card was enhanced
`
`11· ·with additional capabilities and the additional memory,
`
`12· ·competing power to store credentials for credit and
`
`13· ·debit cards, specifically Visa cards, Mastercard,
`
`14· ·Discover, and AmEx cards.
`
`15· · · · · · ·The -- so Softcard infrastructure had
`
`16· ·communications through mobile phone to the -- to that
`
`17· ·SIM card and also direct communications back to
`
`18· ·participating banks, which included Chase, Bank of
`
`19· ·America, American Express, Discover, Capital One, Wells
`
`20· ·Fargo, and may have been some others.
`
`21· · · · · · ·The banks then will, in conjunction with
`
`22· ·Softcard, using Softcard's mobile -- through Softcard's
`
`23· ·infrastructure, I should say, banks are able to
`
`24· ·provision the credentials for their -- for their cards
`
`25· ·to mobile phones.
`
`APPL-1023 / IPR2023-00398
`APPLE INC. v. FINTIV, INC. / Page 24 of 83
`
`
`
`·1· · · · · · ·And when I say provision, that means
`
`·2· ·delivering the -- what you would think of as card data.
`
`·3· ·Basically the information that's -- that you would
`
`·4· ·commonly see printed on the front and the back of the
`
`·5· ·card such as card holder's name, the account number on
`
`·6· ·the card, expiration date, and if you're familiar with
`
`·7· ·the CVV, CVC three-digit code that's on the back of the
`
`·8· ·card, this technology did not use that but used
`
`·9· ·something different from that in place of it because, of
`
`10· ·course, the CVV number is static.
`
`11· · · · · · ·This instead used a dynamically generated
`
`12· ·cryptogram to authenticate the card in place of the CVV.
`
`13· · · · · · ·The mobile phones were developed especially
`
`14· ·for this service and included an NFC contactless
`
`15· ·controller chip which is able to communicate using ISO
`
`16· ·14443 protocol to connect to payment terminals and also
`
`17· ·had a direct -- also had a direct communications to the
`
`18· ·SIM card so that if you -- if you held your mobile phone
`
`19· ·in close proximity to a payment terminal, that would
`
`20· ·activate the contactless payment circuitry and trigger
`
`21· ·the communication between the payment terminal and
`
`22· ·through the -- through the contactless antenna and chip
`
`23· ·to the SIM card where it would communicate directly with
`
`24· ·the application that was provisioned by the bank.
`
`25· · · · · · ·And that will exchange the card details and
`
`APPL-1023 / IPR2023-00398
`APPLE INC. v. FINTIV, INC. / Page 25 of 83
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`
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`·1· ·negotiate some other aspects of a transaction, including
`
`·2· ·delivering that unique cryptogram for the transaction.
`
`·3· · · · · · ·Softcard also had a user application that
`
`·4· ·allowed you to interact with these cards, choose which
`
`·5· ·one you wanted to use for a transaction, also connect
`
`·6· ·back to the banks to ask for cards to be provisioned.
`
`·7· ·Included also a separate contactless protocol for
`
`·8· ·loyalty cards and coupons.
`
`·9· · · · · · ·Coupons were used by Coca Cola.· Loyalty cards
`
`10· ·were used by, for example -- Jamba Juice is also using
`
`11· ·coupons.· Oh, I don't recall the -- the loyalty stuff
`
`12· ·off the top of my head.· I'd have to go back and look.
`
`13· · · · · · ·But -- so pretty broad range of services in an
`
`14· ·application of this sort.
`
`15· · · · · · ·The Google wallet in various iterations ended
`
`16· ·up being similar to this.· Apple's -- Apple has both
`
`17· ·Apple Wallet and Apple Pay which ended up being somewhat
`
`18· ·similar to this, but if you -- you know, if you look at
`
`19· ·the sequence in timing, Softcard was one of the first in
`
`20· ·the market.
`
`21· · · · Q.· ·So you mentioned that Softcard kind of -- the
`
`22· ·phone -- the phones used with Softcard were specialized
`
`23· ·to have -- to be able to use that platform; is that
`
`24· ·correct?
`
`25· · · · A.· ·Prior to -- prior to Softcard -- well, I mean,
`
`APPL-1023 / IPR2023-00398
`APPLE INC. v. FINTIV, INC. / Page 26 of 83
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`·1· ·if you look at the economics of mobile phones, what
`
`·2· ·happens is a company like Verizon Wireless buys millions
`
`·3· ·of mobile phones from manufacturers and then distributes
`
`·4· ·them through their retail channels.· And they try to do
`
`·5· ·that at a reasonable profit, both for Verizon Wireless
`
`·6· ·and for the manufacturers.· And so managing the cost of
`
`·7· ·the devices is important.
`
`·8· · · · · · ·So prior to the development of Softcard,
`
`·9· ·phones generally didn't have the type of hardware that I
`
`10· ·was talking about, these NFC chips, the NFC antennas.
`
`11· · · · · · ·The SIM cards generally didn't have the extra
`
`12· ·memory and processing capabilities.· You know, those
`
`13· ·things cost a couple of dollars per handset which, when
`
`14· ·you're buying billions of handsets, it adds up.
`
`15· · · · · · ·So that was something as part of the
`
`16· ·project -- part of the joint venture that Softcard had
`
`17· ·with these mobile operators, was working with them and
`
`18· ·the handset manufacturers and SIM manufacturers to
`
`19· ·include all that technology in their mobile phones.
`
`20· · · · Q.· ·In the Softcard system, are there various
`
`21· ·types of mobile wallets that can be used with it or a
`
`22· ·single type that's kind of specialized?
`
`23· · · · A.· ·I belie
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