Case 6:21-cv-01101-ADA Document 73-13 Filed 01/19/23 Page 1 of 73
`Case 6:21-cv-01101-ADA Document 73-13 Filed 01/19/23 Page 1 of 73
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`EXHIBIT K
`EXHIBIT K
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`

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`Case 6:21-cv-01101-ADA Document 73-13 Filed 01/19/23 Page 2 of 73
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`
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`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`———————
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`———————
`
`APPLE INC.,
`Petitioner,
`
`v.
`
`AIRE TECHNOLOGY LIMITED,
`Patent Owner.
`———————
`
`IPR2023-00080
`U.S. Patent No. 8,205,249
`
`
`PETITION FOR INTER PARTES REVIEW
`UNDER 35 U.S.C. § 312 AND 37 C.F.R. § 42.104
`
`
`
`
`
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`
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`

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`Case 6:21-cv-01101-ADA Document 73-13 Filed 01/19/23 Page 3 of 73
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`IPR2023-00080 Petition
`Inter Partes Review of U.S. 8,205,249
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`
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`TABLE OF CONTENTS
`
`PETITIONER’S EXHIBIT LIST .............................................................................. 5
`
`I.
`
`INTRODUCTION ........................................................................................... 7
`
`II.
`
`GROUNDS FOR STANDING ........................................................................ 8
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`III. NOTE ............................................................................................................... 8
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`IV. SUMMARY OF THE ’249 PATENT ............................................................. 8
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`V.
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`PROSECUTION HISTORY .........................................................................11
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`VI. LEVEL OF ORDINARY SKILL IN THE ART ...........................................13
`
`VII. CLAIM CONSTRUCTION ..........................................................................14
`
`VIII. RELIEF REQUESTED AND THE REASONS FOR THE
`REQUESTED RELIEF .................................................................................16
`
`IX. DISCRETIONARY DENIAL WOULD BE INAPPROPRIATE .................16
`
`A. Discretionary denial under the Fintiv factors is not appropriate ........ 16
`
`1.
`
`2.
`
`3.
`
`4.
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`5.
`
`6.
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`No evidence regarding a stay ................................................... 16
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`Parallel proceeding trial date ................................................... 17
`
`Investment in the parallel proceeding ...................................... 18
`
`Overlapping issues with the parallel proceeding ..................... 19
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`Petitioner is a defendant ........................................................... 19
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`Other circumstances ................................................................. 19
`
`B.
`
`The Fintiv Framework Should Be Overturned................................... 20
`
`C.
`
`Discretionary denial under General Plastic is not appropriate .......... 20
`
`2
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`Case 6:21-cv-01101-ADA Document 73-13 Filed 01/19/23 Page 4 of 73
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`IPR2023-00080 Petition
`Inter Partes Review of U.S. 8,205,249
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`
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`1.
`
`2.
`
`3.
`
`4.
`
`5.
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`6.
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`Factor 1: Whether the same petitioner previously filed a
`petition directed to the same claims of the same patent. ......... 21
`
`Factor 2: Whether at the time of filing of the first
`petition the petitioner knew of the prior art asserted in
`the second petition or should have known of it. ...................... 24
`
`Factor 3: Whether at the time of filing of the second
`petition the petitioner already received the patent
`owner’s preliminary response to the first petition or
`received the Board’s decision on whether to institute
`review in the first petition. ....................................................... 25
`
`Factor 4: The length of time elapsed between learning
`of prior art and filing second petition ...................................... 25
`
`Factor 5: whether the petitioner provides adequate
`explanation for the time elapsed between filings of
`multiple petitions directed to the same claims of the
`same patent ............................................................................... 26
`
`Factors 6 and 7: The finite resources of the Board and
`the requirement under 35 U.S.C. § 316(a)(11). ....................... 27
`
`D. Discretionary denial under 35 U.S.C. § 325(d) is not appropriate .... 28
`
`X.
`
`IDENTIFICATION OF HOW THE CLAIM IS UNPATENTABLE ..........29
`
`A.
`
`Challenged Claim ............................................................................... 29
`
`B.
`
`Statutory Grounds for Challenges ...................................................... 29
`
`C.
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`Ground 1: Claim 13 is obvious under 35 U.S.C. § 103 over Burger
`and Cheng. .......................................................................................... 30
`
`1.
`
`2.
`
`3.
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`Summary of Burger .................................................................. 30
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`Summary of Cheng .................................................................. 35
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`Reasons to Combine Burger and Cheng .................................. 37
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`3
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`Case 6:21-cv-01101-ADA Document 73-13 Filed 01/19/23 Page 5 of 73
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`IPR2023-00080 Petition
`Inter Partes Review of U.S. 8,205,249
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`a)
`
`b)
`
`c)
`
`A POSITA would have found it obvious to add Cheng’s
`authentication level information to Burger’s Pocket
`Vault ......................................................................................... 38
`
`A POSITA would have found it obvious to add Cheng’s
`authentication method selection technique to Burger’s
`Pocket Vault ............................................................................. 42
`
`A POSITA would have had a reasonable expectation of
`success combining Burger and Cheng ..................................... 45
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`4.
`
`Claim 13 ................................................................................... 47
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`XI. CONCLUSION ..............................................................................................68
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`XII. MANDATORY NOTICES ...........................................................................69
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`A.
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`Real Party-in-Interest ......................................................................... 69
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`B.
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`Related Matters ................................................................................... 69
`
`C.
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`Lead and Back-up Counsel and Service Information ........................ 69
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`CERTIFICATE OF WORD COUNT ......................................................................71
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`CERTIFICATE OF SERVICE ................................................................................72
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`4
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`Case 6:21-cv-01101-ADA Document 73-13 Filed 01/19/23 Page 6 of 73
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`IPR2023-00080 Petition
`Inter Partes Review of U.S. 8,205,249
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`
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`PETITIONER’S EXHIBIT LIST
`
`Ex.1001
`
`U.S. Patent No. 8,205,249
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`Ex.1002
`
`Prosecution History of U.S. Patent No. 8,205,249
`
`Ex.1003
`
`Declaration of Dr. Clifford Neuman under 37 C.F.R. § 1.68
`
`Ex.1004
`
`Curriculum Vitae of Dr. Clifford Neuman
`
`Ex.1005
`
`U.S. Patent No. 7,080,037 to Burger et al.
`
`Ex.1006
`
`U.S. Application Publication No. 2004/0039909 to Cheng
`
`Ex.1007
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`U.S. Application Publication No. 2003/0101348 to Russo et al.
`
`Ex.1008
`
`U.S. Patent No. 7,127,606 to Wheeler et al.
`
`Ex.1009
`
`U.S. Patent No. 7,260,724 to Dickinson et al.
`
`Ex.1010
`
`U.S. Patent No. 6,941,285 to Sarcanin
`
`Ex.1011
`
`U.S. Patent No. 5,422,953 to Fischer
`
`Ex.1012
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`U.S. Patent No. 7,941,669 to Foley et al.
`
`Ex.1013
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`U.S. Patent No. 7,137,008 to Hamid et al.
`
`Ex.1014
`
`U.S. Patent No. 5,721,781 to Deo et al.
`
`Ex.1015
`
`U.S. Application Publication No. 2002/0016913 to Wheeler et al
`
`Ex.1016
`
`Ex.1017
`
`Ex.1018
`
`Complaint, Aire Technology Ltd. v. Apple Inc. 6-21-cv-01101
`(W.D. Tex. Oct. 22, 2021)
`
`Complaint, Aire Technology Ltd v. Samsung Electronics Co., Ltd.,
`6:21-cv-00955 (W.D. Tex. Sep. 15, 2021)
`
`Plaintiff’s Preliminary Disclosure of Asserted Claims and
`Infringement Contentions to Defendant Apple Inc, Aire Technology
`Ltd. v. Apple Inc. 6-21-cv-01101 (W.D. Tex. Jan. 20, 2022)
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`5
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`Case 6:21-cv-01101-ADA Document 73-13 Filed 01/19/23 Page 7 of 73
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`IPR2023-00080 Petition
`Inter Partes Review of U.S. 8,205,249
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`Ex.1019
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`Reserved.
`
`Ex.1020
`
`Ex.1021
`
`Ex.1022
`
`Ex.1023
`
`Scheduling Order, Aire Technology Ltd. v. Apple Inc. 6-21-cv-
`01101 (W.D. Tex. Sept. 21, 2022)
`
`Kohl et al., rfc1510, The Kerberos Network Authentication Service
`(V5) (1993)
`
`Ryutov et al., Access control framework for distributed
`applications (2000)
`
`(Plaintiff Aire Technology Ltd.’s Motion to Amend Preliminary
`Infringement Contentions, Aire Technology Ltd. v. Apple Inc. 6-21-
`cv-01101 (W.D. Tex. Sept. 30, 2022)
`
`Ex.1024
`
` Patent Owner Preliminary Response, IPR2022-01135, Paper 6
`
`Ex.1025
`
`Federal District Court Trial Statistics (June 30, 2022)
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`
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`6
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`Case 6:21-cv-01101-ADA Document 73-13 Filed 01/19/23 Page 8 of 73
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`IPR2023-00080 Petition
`Inter Partes Review of U.S. 8,205,249
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`I.
`
`INTRODUCTION
`
`U.S. Patent No. 8,205,249 (the “’249 patent,” Ex.1001) is directed to user
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`authentication in the context of an electronic transaction. The background of the
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`’249 patent explains that it was common for a user of a chip card to establish proof
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`of their identity using several different methods, including by entering a PIN or
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`analyzing a biometric feature, e.g., a fingerprint. Ex.1001, 1:15-30. According to
`
`the ’249 patent, these different methods are of different “quality.” Ex.1001, 1:36-
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`38. The alleged invention of the ’249 patent simply takes into account the “quality
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`of the user authentication performed” when several different authentication
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`methods are available. Ex.1001, 1:39-42. Accounting for the “quality” of an
`
`authentication method, however, was already well known in the prior art. For
`
`example, U.S. Publication No. 2004/0039909 to Cheng teaches assigning
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`“authentication levels” to authentication methods based on a “confidence in
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`security.” Ex.1006, [0033]; see also, e.g., Ex.1009, 34:51-35:35 (accounting for the
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`“reliability of the authentication technique being used”); Ex.1007, [0051]
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`(generating a “Authentication Trust Metric” that “indicates a degree of confidence
`
`in the security of a method of authentication”).
`
`The present petition challenges only claim 13, which Patent Owner moved
`
`to add to the parallel district court litigation on September 30, 2022—well after
`
`Apple Inc. (“Petitioner”) had filed a petition challenging originally-asserted claims
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`7
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`Case 6:21-cv-01101-ADA Document 73-13 Filed 01/19/23 Page 9 of 73
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`IPR2023-00080 Petition
`Inter Partes Review of U.S. 8,205,249
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`1-12.
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`Accordingly, pursuant to 35 U.S.C. §§ 311, 314(a), and 37 C.F.R. § 42.100,
`
`Petitioner respectfully requests that the Board review and cancel as unpatentable
`
`under (pre-AIA) 35 U.S.C. §103 claim 13 (hereinafter, the “Challenged Claim”) of
`
`the ’249 patent.
`
`II. GROUNDS FOR STANDING
`
`Petitioner certifies that the ’249 patent is eligible for IPR and that Petitioner
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`is not barred or estopped from requesting IPR challenging the patent claim. 37
`
`C.F.R. § 42.104(a).
`
`III. NOTE
`
`Petitioner cites to exhibits’ original page numbers. Emphasis in quoted
`
`material has been added. Claim terms are presented in italics.
`
`IV. SUMMARY OF THE ’249 PATENT
`
`The ’249 patent generally relates to “secure authentication of a user of a
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`portable data carrier communicating with a terminal.” Ex.1001, 1:9-10. The
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`portable data carrier may, for example, be a “chip card” carried by a user for use in
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`a secure electronic transaction effected between the terminal and the portable data
`
`carrier. Ex.1001, 3:3-9, Abstract. Fig. 1 of the ’249 patent, annotated below,
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`illustrates the portable data carrier and the terminal.
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`Case 6:21-cv-01101-ADA Document 73-13 Filed 01/19/23 Page 10 of 73
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`IPR2023-00080 Petition
`Inter Partes Review of U.S. 8,205,249
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`terminal
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`portable data carrier
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`user
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`Ex.1001, Fig. 1 (annotated); Ex.1003, ¶ 34.
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`
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`The ’249 patent explains that the “portable data carrier 20 is further set up to
`
`perform … a plurality of different quality user authentication methods.” Ex.1001,
`
`3:22-26. For example, the portable data carrier “expediently supports at least one
`
`knowledge-based authentication method, e.g., a PIN check, and at least one
`
`biometric method.” Ex.1001, 3:26-28. The ’249 patent notes that the “biometric
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`method inherently constitutes the higher-quality one here, since it presupposes the
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`personal presence of the user 30; this is not ensured in the knowledge-based
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`Case 6:21-cv-01101-ADA Document 73-13 Filed 01/19/23 Page 11 of 73
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`method since the knowledge can have been acquired by an unauthorized user.”
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`IPR2023-00080 Petition
`Inter Partes Review of U.S. 8,205,249
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`Ex.1001, 3:29-34.
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`With reference to Figs. 2 and 3, the ’249 patent describes using the portable
`
`data carrier in the context of a secure electronic transaction—where Fig. 2
`
`illustrates user authentication with a PIN-based method and Fig. 3 illustrates user
`
`authentication with a biometric-based method. In steps 114/116 (Fig. 2) and steps
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`134-140 (Fig. 3), the portable data carrier respectively receives either the PIN or
`
`biometric, e.g., fingerprint, input by the user and either “checks the transmitted
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`PIN” or “compares the received extracted [fingerprint] features with the reference
`
`features stored in the storage means and checks whether a sufficient match is
`
`present.” Ex.1001, 4:19-64. If the PIN or fingerprint is a match with the stored
`
`values, the portable data carrier “confirms the correctness to the terminal” in steps
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`117 and 142, respectively. Ex.1001, 4:27-28, 4:64-67. In steps 118 and 144, the
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`portable data carrier “perform[s] the security-establishing operation, i.e. the digital
`
`signature.” Ex.1001, 4:30-32, 5:1-6. The ’249 patent explains that this step “is not
`
`restricted to … a digital signature” and may more generally include, for example,
`
`the portable data carrier “subject[ing] a supplied data record 40 … to a
`
`cryptographic algorithm, whereby it uses at least one secret key stored in the
`
`storage means 26.” Ex.1001, 2:28-33, 3:16-20.
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`Further, in step 148 of Fig. 3, the portable data carrier “forms quality
`
`10
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`Case 6:21-cv-01101-ADA Document 73-13 Filed 01/19/23 Page 12 of 73
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`IPR2023-00080 Petition
`Inter Partes Review of U.S. 8,205,249
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`information,” where the “quality information is about the quality of the previously
`
`performed user authentication.” Ex.1001, 5:15-17, 5:39-41. As discussed above,
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`the ’249 patent alleges that previous methods did not generate or take into account
`
`such quality information. Ex.1001, 1:36-38 (“However, the thereby realized quality
`
`difference with regard to user authentication is hitherto not reflected in the
`
`usability of the particular electronic signature produced.”). Then in step 150, a
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`“security message consisting of digital signature and quality information is sent by
`
`the portable data carrier 20 back to the terminal 14.” Ex.1001, 5:21-23.
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`V.
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`PROSECUTION HISTORY
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`The ’249 patent was filed in the U.S. on April 24, 2006 as a national stage
`
`entry of PCT Publication No. WO2004/038665, filed October 23, 2003. The PCT
`
`application claims priority to German application DE10249801.6 filed October 24,
`
`2002. The ’249 patent issued on June 19, 2012. It is unnecessary to determine
`
`whether the ’249 patent is entitled to its earliest alleged priority date because the
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`prior art relied upon herein pre-dates the earliest alleged priority date.
`
`During a prolonged prosecution that included a Notice of Appeal, the
`
`Examiner rejected the pending application over numerous references, including
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`U.S. Patent Application No. 2003/0101348 to Russo (“Russo,” Ex.1007) that
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`teaches the allegedly novel aspect of the ’249 patent. Ex.1002, 402. Specifically,
`
`with respect to the claimed “authentication quality information,” the Examiner
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`Case 6:21-cv-01101-ADA Document 73-13 Filed 01/19/23 Page 13 of 73
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`IPR2023-00080 Petition
`Inter Partes Review of U.S. 8,205,249
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`pointed to Russo’s teaching of an “Authentication Trust Metric” that indicates a
`
`“degree of confidence in the security of a method of authentication.” Ex.1002, 402-
`
`404 (citing Ex.1007, [0046], [0051]). In response, the Applicants explicitly
`
`acknowledged that “the trust metric Russo [] may be interpreted to represent the
`
`authentication quality information of the present invention.” Ex.1002, 387.
`
`Despite this admission, Applicants eventually overcame the rejection by arguing
`
`Russo did not teach various other limitations in the pending claims. Ex.1002, 385-
`
`88.
`
`The Examiner replaced Russo with U.S. Application Publication No.
`
`2002/0016913 to Wheeler (Ex.1015) and maintained his rejection over Wheeler
`
`through a Non-Final Rejection, a Final Rejection, an Advisory Action, and a
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`Notice of Appeal. Ex.1002, 352-59, 313-22, 301-03, 289. By the Pre-Appeal
`
`Conference, Applicants had narrowed down their argument to a single issue—
`
`whether Wheeler taught the claimed “authentication quality information.”
`
`Ex.1002, 292-95. Specifically, Applicants argued that “Wheeler represents the
`
`quality of the match for different executions of a particular authentication method,”
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`whereas the claims “relate to the quality of the user authentication method, itself.”
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`Ex.1002, 293-94 (emphasis in original). Based on this argument, the Examiner re-
`
`opened prosecution and allowed the application. Ex.1002, 286, 256-58. In other
`
`words, the ’249 patent was allowed because Wheeler allegedly did not teach the
`
`12
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`Case 6:21-cv-01101-ADA Document 73-13 Filed 01/19/23 Page 14 of 73
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`IPR2023-00080 Petition
`Inter Partes Review of U.S. 8,205,249
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`“quality information” that Applicants had already admitted was taught by Russo:
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`“[T]he trust metric Russo [] may be interpreted to represent the authentication
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`quality information of the present invention.” Ex.1002, 387. Accordingly, the
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`Examiner erred in allowing the ’249 patent.
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`As illustrated in this petition, Russo’s trust metric is just one example of
`
`authentication quality information in the prior art. See, e.g., Ex.1006, [0033]
`
`(describing “authentication levels” corresponding to authentication methods based
`
`on a “level of confidence in security”); Ex.1009, 34:51-35:35 (accounting for the
`
`“inherent reliability of the authentication technique being used”).
`
`VI. LEVEL OF ORDINARY SKILL IN THE ART
`
`A person of ordinary skill in the art (“POSITA”) in the field of the ’249
`
`patent, as of Oct. 24, 2002, would have been someone knowledgeable and familiar
`
`with the secure electronic transaction arts that are pertinent to the ’249 patent. That
`
`person would have at least a four-year degree in electrical engineering, computer
`
`engineering, computer science, or a related field and two years of relevant
`
`experience in computer security, and developing, implementing, or deploying
`
`portable devices on systems connected to computer networks. A Master’s or Ph.D.
`
`degree in a relevant field may substitute for some work experience and greater
`
`experience might substitute for a four-year degree. Ex.1003, ¶ 18.
`
`13
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`Case 6:21-cv-01101-ADA Document 73-13 Filed 01/19/23 Page 15 of 73
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`IPR2023-00080 Petition
`Inter Partes Review of U.S. 8,205,249
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`VII. CLAIM CONSTRUCTION
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`In an inter partes review, claims “shall be construed using the same claim
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`construction standard that would be used to construe the claim in a civil action
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`under 35 U.S.C. 282(b), including construing the claim in accordance with the
`
`ordinary and customary meaning of such claim as understood by one of ordinary
`
`skill in the art and the prosecution history pertaining to the patent.” 37 C.F.R. §
`
`42.100(b). The Board only construes the claims to the extent necessary to resolve
`
`the underlying controversy. Nidec Motor Corp. v. Zhongshan Broad Ocean Motor
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`Co., 868 F.3d 1013, 1017 (Fed. Cir. 2017). Petitioner submits that for the purposes
`
`of this proceeding, the terms of the challenged claims should be given their plain
`
`and ordinary meaning, and no terms require specific construction.1 Ex.1003, ¶ 38.
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`Although claim 13 is not at issue in the parallel litigation, Petitioner notes
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`the term “an inherently relatively lower quality and an inherently relatively higher
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`quality from a security perspective” is recited in independent claims 1 and 10 and
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`has been construed as follows by Petitioner and Patent Owner in District Court:
`
`
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` Petitioner does not concede that any term in the challenged claims meets the
`
` 1
`
`statutory requirements of 35 U.S.C. § 112, or that the challenged claims recite
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`patentable subject matter under 35 U.S.C. § 101.
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`14
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`Case 6:21-cv-01101-ADA Document 73-13 Filed 01/19/23 Page 16 of 73
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`IPR2023-00080 Petition
`Inter Partes Review of U.S. 8,205,249
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`Patent Owner
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`Petitioner
`
`No construction necessary.
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`Indefinite.
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`For the purposes of this proceeding, Petitioner adopts Patent Owner’s
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`constructions for the above term. See 37 C.F.R. § 42.104(b)(3) (requiring the
`
`petition to set forth only “how the challenged claim is to be construed”); see also
`
`Google LLC v. AGIS Software Devel., LLC, IPR2018-01083, Paper 10 at 10-11
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`(Jan. 10, 2019) (explaining that the language of § 42.104(b)(3) “does not refer to
`
`belief in the correctness of the construction” and instituting because the “Petition
`
`sets forth with sufficiency [Petitioner’s] assertions as to how the claims are to be
`
`construed in this proceeding”); Hospira, Inc. et al. v. Amgen Inc., IPR2021-00528,
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`Paper 7 at 7 (Aug. 17, 2021) (“Whether Petitioner ultimately argues that the
`
`proposed claim constructions it seeks to adopt for this proceeding will render the
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`claims indefinite is immaterial insofar as indefiniteness is not an unpatentability
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`ground that can be asserted in an inter partes review petition.”).
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`Regardless of the indefiniteness of the term, claim 13 is still rendered
`
`obvious by art cited in this petition. For example, any uncertainty as to the outer
`
`boundaries of the term claim does not preclude application of prior art that
`
`discloses the same authentication methods as described in the ’249 patent.
`
`Compare Ex.1001, 3:55-62, Figs. 2, 3 (describing a “PIN check” and a “fingerprint
`
`check”) with Ex.1005, 12:9-25 (describing a “PIN code” and a “fingerprint scan”).
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`15
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`Case 6:21-cv-01101-ADA Document 73-13 Filed 01/19/23 Page 17 of 73
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`IPR2023-00080 Petition
`Inter Partes Review of U.S. 8,205,249
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`VIII. RELIEF REQUESTED AND THE REASONS FOR THE
`REQUESTED RELIEF
`
`Petitioner asks that the Board institute a trial for inter partes review and
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`cancel the Challenged Claim in view of the analysis below.
`
`IX. DISCRETIONARY DENIAL WOULD BE INAPPROPRIATE
`
`A. Discretionary denial under the Fintiv factors is not appropriate
`
`The six factors considered for § 314 denial strongly favor institution. See
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`Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 11 (Mar. 20, 2020) (precedential).
`
`The district court case is at an early stage—the claims have not yet been construed
`
`nor has fact discovery closed. Petitioner has diligently prepared and filed this
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`petition within three weeks of Patent Owner asking the district court to add claim
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`13 to the litigation. See Ex.1023 (Plaintiff Aire Technology Ltd.’s Motion to
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`Amend Preliminary Infringement Contentions).
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`1. No evidence regarding a stay
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`No motion to stay in view of Apple’s IPRs has been filed, so the Board
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`should not infer the outcome of such a motion. Sand Revolution II LLC v.
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`Continental Intermodal Group – Trucking LLC, IPR2019-01393, Paper 24 at 7
`
`(June 16, 2020) (informative); see also Dish Network L.L.C. v. Broadband iTV,
`
`Inc., IPR2020-01359, Paper 15 at 11 (Feb. 12, 2021) (“It would be improper to
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`speculate, at this stage, what the Texas court might do regarding a motion to
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`IPR2023-00080 Petition
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`stay…”). Thus, this factor is neutral on discretionary denial.
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`2. Parallel proceeding trial date
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`The co-pending litigation is at an early stage, and the district court has
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`already moved back the trial date once. The district court entered a revised
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`scheduling order that sets the Markman hearing for May 16, 2023 and sets the trial
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`for November 6, 2023. Ex.1020, 2-3. However, the trial schedule, including the
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`trial date, remains uncertain given Patent Owner’s motion to add claim 13 to the
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`litigation. See Ex.1023.
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`Moreover, based on median time-to-trial statistics, the projected trial date—
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`which the Board uses for its Fintiv analysis2—is even later than the trial date in the
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`revised scheduling order. The co-pending district court case was filed in the
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`Western District of Texas on October 22, 2021. The most recent statistics show a
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` Interim Procedure For Discretionary Denials In AIA Postgrant Proceedings With
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` 2
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`Parallel District Court Litigation, 9 (“The PTAB will weigh this factor [factor 2]
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`against exercising discretion to deny institution under Fintiv if the median time-to-
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`trial is around the same time or after the projected statutory deadline for the
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`PTAB's final written decision.”).
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`median time-to-trial in the Western District of 28.3 months. Ex.1025, 5.
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`Accordingly, the projected trial date for purposes of the Board’s Fintiv analysis is
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`late February 2024—approximately 28 months after October 2021.
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`3. Investment in the parallel proceeding
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`Claim 13 is not at issue in the parallel district court proceeding and thus no
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`investment has been made in issues specific to claim 13. Even if Patent Owner’s
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`motion is granted, however, investment at the time of institution in issues specific
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`to claim 13 will be minimal. A claim construction hearing will not yet have
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`occurred, fact discovery will not close until March 2023, and expert discovery will
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`not have commenced and will not close until August 2023. Ex.1020, 2; see PEAG
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`LLC v. Varta Microbattery GmbH, IPR2020-01214, Paper 8 at 17 (Jan. 6, 2021).
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`This lack of investment favors institution.
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`Moreover, Petitioner only learned Patent Owner intended to move to add
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`claim 13 to the litigation on September 8, 2022. See Ex.1023, 101. Patent Owner
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`did not actually file its motion until September 30, 2022. See Ex.1023, 4. Petitioner
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`has worked expeditiously to file this petition within three weeks of Patent Owner
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`filing its motion. Under Fintiv, Petitioner’s prompt filing “weigh[s] against
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`exercising the authority to deny institution.” Fintiv, Paper 11 at 11 (“If the
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`evidence shows that the petitioner filed the petition expeditiously, such as
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`promptly after becoming aware of the claims being asserted, this fact has weighed
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`against exercising the authority to deny institution under NHK.”); see also Apple
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`Inc. v. Koss Corporation, IPR2021-00592, Paper 9 at 16 (Aug. 23, 2021).
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`4. Overlapping issues with the parallel proceeding
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`There is no overlap with respect to the validity of claim 13 because Patent
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`Owner did not move to add claim 13 until after Petitioner prepared and served its
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`preliminary invalidity contentions on March 31, 2022. Even if claim 13 is added to
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`the litigation, the extent of overlap at institution will be speculative.
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`5. Petitioner is a defendant
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`Petitioner is a defendant in the co-pending litigation. That is true of most
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`Petitioners in IPR proceedings, making this factor neutral. See HP Inc. v. Slingshot
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`Printing LLC, IPR2020-01084, Paper 13 at 9 (Jan. 14, 2021) (having the “same
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`parties as parallel proceeding” makes factor 5 “neutral”).
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`6. Other circumstances
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`The prior art presented in this Petition renders the Challenged Claim
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`unpatentable as obvious. The merits of Petitioner’s arguments are strong.
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`Moreover, Petitioner worked expeditiously to file this IPR within three weeks of
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`Patent Owner moving to add claim 13 to the parallel litigation, and even before
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`knowing whether the court will grant Patent Owner’s motion.
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`As such, because the Fintiv factors are either neutral or weigh against
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`discretionary denial, institution should not be denied on discretionary factors.
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`B.
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`The Fintiv Framework Should Be Overturned
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`Apart from Petitioner’s showing that the Fintiv factors favor institution, the
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`Fintiv framework should be overturned because it (1) exceeds the Director’s
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`authority, (2) is arbitrary and capricious, and (3) was adopted without notice-and-
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`comment rulemaking.
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`C. Discretionary denial under General Plastic is not appropriate
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`Two previous IPRs have been filed against the ’249 patent—one by
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`Samsung Electronics Co., Ltd. et al (IPR2022-00875) and one by Apple (IPR2022-
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`01135). The Samsung IPR terminated prior to institution and the Apple IPR
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`challenged only claims 1-12—the claims identified by Patent Owner in its
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`Preliminary Infringement Contentions. Ex.1018, 1. The present petition challenges
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`claim 13, which Patent Owner now seeks to add to the parallel litigation. See
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`Ex.1023, 4.
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`The present petition is not an unfair “follow-on” petition of the type
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`contemplated by General Plastic. Rather, Patent Owner’s own actions necessitated
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`this filing. Patent Owner chose to separately file suit against Apple and Samsung.
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`Patent Owner also waited nearly a year after suing Apple before moving to add
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`claim 13 to the litigation—well after Apple had filed its IPR against the originally-
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`asserted claims of the ’249 patent. Importantly, Patent Owner moved to add claim
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`13 just weeks before Petitioner’s one-year statutory deadline to file an IPR petition.
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`As such, Patent Owner’s delay makes it unlikely the court will rule on the motion
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`before the one-year bar, forcing Petitioner to challenge claim 13 before knowing
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`whether it will be at issue in the district court.
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` Patent Owner’s actions aside, discretionary denial of this petition is still
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`inappropriate because it presents new grounds and prior art not found in the
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`Samsung IPR, and challenges a claim that was not challenged in Apple’s previous
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`IPR. All General Plastic factors weigh in favor of institution.
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`1.
`Factor 1: Whether the same petitioner previously filed a
`petition directed to the same claims of the same patent.
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`This factor weighs in favor of institution with respect to both the previous
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`Apple IPR and the Samsung IPR.
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`Previous Apple IPR
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`Apple’s prior petition challenged claims 1-12 of the ’249 patent, the subset
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`of claims identified in Patent Owner’s Preliminary Infringement Contentions.
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`Ex.1018, 1. Petitioner has not previously challenged claim 13. As such, this factor
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`weighs heavily against discretionary denial. See Xilinx, Inc. v. Analog Devices,
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`Inc., IPR2020-01564, Paper 12 at 11 (Mar. 15, 2021) (“We determine that factor 1
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`does not weigh in favor of denying institution because Petitioner challenges claims
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`not previously challenged and we are not persuaded that Petitioner reasonably
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`could have known without benefit of the infringement contentions to include all
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`challenged claims in one or both of the first two filed petitions.”); Volkswagen
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`Grp. v. Carucel Invs., L.P., IPR2019-01573, Paper 7 at 6-7 (Jan. 22, 2020) (finding
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`that Factor 1 weighs against discretionary denial where challenged claims in the
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`second petition “are still different claims that Patent Owner chose to assert in the
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`district court after Petitioner filed the [earlier] petition”).
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`Previous Samsung IPR
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`On September 15, 2021, Patent Owner filed suit against Samsung alleging
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`infringement of Samsung’s products, and more than five weeks later, on October
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`22, 2021, Patent Owner separately filed suit against Petitioner Apple alleging
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`infringement of Apple’s products. On April 22, 2022, Samsung filed inter partes
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`review proceeding IPR2022-00875 against the ’249 patent. Apple was not involved
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`in preparing and filing the Samsung IPR. On October 18, 2022, the Board
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`terminated the Samsung IPR prior to institution.
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`This factor weighs against denial be