United States Patent and Trademark Office
`
`________________________________________________
`
`Before the Patent Trial and Appeal Board
`________________________________________________
`
`
`
`D-Link Systems, Inc.,
`Petitioner
`
`v.
`
`Chrimar Systems, Inc.
`Patent Owner
`
`
`
`________________________________________________
`
`Case No. IPR2016-01426
`U.S. Patent No. 9,019,838
`________________________________________________
`
`
`Patent Owner’s Preliminary Response
`Under 37 C.F.R. § 42.107(a)
`
`
`
`
`
`
`
`
`
`

`
`Case No. IPR2016-01426
`U.S. Patent No. 9,019,838
`
`
`Table of Contents
`
`Table of Authorities ................................................................................................ iv 
`Cases ....................................................................................................................... iv 
`Statutes .................................................................................................................... v 
`Other Authorities ..................................................................................................... v 
`Rules ........................................................................................................................ v 
`Patent Owner’s Exhibit List .................................................................................... vi 
`Introduction and Summary of Arguments ............................................................... 1 
`Background .............................................................................................................. 3 
`A.  Status of Related Litigation ............................................................................ 3 
`B.  Chrimar .......................................................................................................... 5 
`C.  The ’838 Patent ............................................................................................. 7 
`D. Person of Ordinary Skill ................................................................................ 11 
`Arguments and Authorities .................................................................................... 12 
`A.  Legal Standard ............................................................................................. 12 
`B.  The Petition does not name all real parties-in-
`interest. .........................................................................................................13 
`1.  Legal Standard .........................................................................................13 
`2.  D-Link Corporation is an unnamed real party-
`in-interest................................................................................................ 14 
`C.  Claim Construction...................................................................................... 20 
`1.  Prior Claim Constructions from the District
`Court Litigation ...................................................................................... 20 
`2.  Prior Claim Constructions from the Board ............................................. 22 
`D. Ground 1: The combination of Chang and Patton
`does not meet every limitation of the claims. ............................................... 23 
`1.  Chang, alone, does not teach or disclose each
`limitation of the claims at issue. .............................................................. 24 
`2.  Petitioner’s proposed combination of Chang
`and Patton fails because: (1) it does not teach or
`
`– ii –
`
`

`
`Case No. IPR2016-01426
`U.S. Patent No. 9,019,838
`
`
`disclose each limitation of the claims at issue;
`and (2) Chang explicitly disparages Patton’s
`detection mechanism. ............................................................................. 28 
`E.  Ground 2: Petitioner has not made a prima facie
`case that the ’838 Patent’s claims are obvious in
`view of the combination of Hunter and Bulan. ............................................. 29 
`1.  Hunter .................................................................................................... 29 
`2.  Bulan ........................................................................................................31 
`3.  The Hunter and Bulan references teach away
`from combining the two references to create the
`system proposed by Petitioner. ............................................................... 33 
`4.  The combination of Hunter and Bulan does not
`disclose or teach every limitation of dependent
`claims 7 and 26. ....................................................................................... 35 
`Conclusion ............................................................................................................. 38 
`Certificate of Compliance with Word Count .......................................................... 40 
`Certificate of Service .............................................................................................. 41 
`
`
`
`– iii –
`
`

`
`Case No. IPR2016-01426
`U.S. Patent No. 9,019,838
`
`
` Table of Authorities
`
`Federal Cases 
`
`AMX, LLC v. Chrimar Sys., Inc.,
`IPR2016-00569, Paper No. 19 ............................................................................ 23
`Dynamic Drinkware, LLC v. Nat’l Graphics, Inc.,
`800 F.3d 1375 (Fed. Cir. 2015) ........................................................................... 12
`Gonzalez v. Banco Central Corp.,
`27 F.3d 751 (1st Cir. 1994) .................................................................................. 14
`Gordon .................................................................................................................... 35
`In re Gordon,
`733 F.2d 900 (Fed. Cir. 1984) ............................................................................ 35
`In re Gurley,
`27 F.3d 551 (Fed. Cir. 1994) ............................................................................... 29
`In re Sponnoble,
`405 F.2d 578 (C.C.P.A. 1969) ............................................................................ 33
`Kinetic Concepts, Inc. v. Smith & Nephew, Inc.,
`688 F.3d 1342 (Fed. Cir. 2012) .......................................................................... 33
`Leo Pharm. Prods., Ltd. v. Rea,
`726 F.3d 1346 (Fed. Cir. 2013) ........................................................................... 33
`McGinley v. Franklin Sports, Inc.,
`262 F.3d 1339 (Fed. Cir. 2001) ........................................................................... 28
`Microsoft Corp. v. Proxyconn, Inc.,
`789 F.3d 1292 (Fed. Cir. 2015) ........................................................................... 20
`Reflectix, Inc. v. Promethean Insulation Tech. LLC,
`IPR2015-00039, Paper 18 (2015) .........................................................................13
`Taylor v. Sturgell,
`553 U.S. 880 (2008) ............................................................................................13
`Tec Air, Inc. v. Denso Mfg. Mich. Inc.,
`192 F.3d 1353 (Fed. Cir. 1999) ............................................................................ 33
`Tietex Int’l, Ltd. v. Precision Fabrics Group, Inc.,
`IPR2014-01248, Paper 39 (2016) ........................................................................ 12
`Zerto, Inc. v. EMC Corp.,
`IPR2014-01254, Paper 35 at (2015) .....................................................................13
`
`– iv –
`
`

`
`Case No. IPR2016-01426
`U.S. Patent No. 9,019,838
`
`
`
`
`State Cases 
`
`35 U.S.C. § 312(a) ...................................................................................................13
`35 U.S.C. § 313 ......................................................................................................... 3
`35 U.S.C. § 314(a) .............................................................................................. 2, 12
`
`
`Cases 
`
`Office Patent Trial Practice Guide,
`77 Fed. Reg. 48,756, (Aug. 14, 2012) ....................................................... 13, 14, 20
`
`
`Federal Statutes 
`
`37 C.F.R. § 42.100(b) ............................................................................................. 20
`37 C.F.R. § 42.104 ................................................................................................. 12
`37 C.F.R. § 42.107 ............................................................................................... 3, 41
`37 C.F.R. § 42.108(c) ......................................................................................... 2, 12
`37 C.F.R. § 42.22(a)(2) .......................................................................................... 12
`
`
`
`– v –
`
`

`
`Case No. IPR2016-01426
`U.S. Patent No. 9,019,838
`
`
` Patent Owner’s Exhibit List
`
`
`
`Chrimar
`System, Inc.
`Exhibit No.
`
`2017
`
`2018
`
`2019
`
`2020
`
`2032
`
`2033
`
`Exhibit Description
`
`Date Filed
`
`Memorandum Opinion and Order, Dkt. No. 96,
`filed in Chrimar Systems, Inc., et al. v. AMX, LLC,
`Civil Action No. 6:13-cv-881-JDL, Eastern District
`of Texas
`
`Memorandum Opinion and Order, Dkt. No. 105,
`filed in Chrimar Systems, Inc., et al. v. AMX, LLC,
`Civil Action No. 6:13-cv-881-JDL, Eastern District
`of Texas
`
`Memorandum Opinion and Order, Dkt. No. 108,
`filed in Chrimar Systems, Inc., et al. v. AMX, LLC,
`Civil Action No. 6:13-cv-881-JDL, Eastern District
`of Texas
`
`Memorandum Opinion and Order, Dkt. No. 122,
`filed in Chrimar Systems, Inc., et al. v. Alcatel-
`Lucent, et al., Civil Action No. 6:15-cv-163-JDL,
`Eastern District of Texas
`Defendants’ Combined Motion for Summary
`Judgment and Claim Construction (selected
`portions), Dkt. No. 73, filed in Chrimar Systems,
`Inc., et al. v. AMX, LLC, Civil Action No. 6:13-cv-
`881-JDL, Eastern District of Texas
`Defendants’ Responsive Claim Construction Brief
`(selected portions), Dkt. No. 432, filed in Chrimar
`Sys., Inc., et al. v. ADTRAN, Inc., et al., Civil
`Action No. 6:15-cv-618-JRG-JDL, Eastern District
`of Texas
`
`10/20/2016
`
`10/20/2016
`
`10/20/2016
`
`10/20/2016
`
`10/20/2016
`
`10/20/2016
`
`– vi –
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`

`
`Case No. IPR2016-01426
`U.S. Patent No. 9,019,838
`
`
`Chrimar
`System, Inc.
`Exhibit No.
`
`Exhibit Description
`
`Date Filed
`
`2034
`
`2035
`
`2036
`
`2037
`
`2038
`
`2039
`
`2040
`
`2041
`
`2042
`
`2043
`
`2044
`
`Memorandum Opinion and Order, Dkt. No. 223,
`filed in Chrimar Sys., Inc., et al. v. Alcatel-Lucent, et
`al., Civil Action No. 6:15-cv-163-JDL, Eastern
`District of Texas
`
`Memorandum Opinion and Order, Dkt. No. 318,
`filed in Chrimar Systems, Inc., et al. v. AMX, LLC,
`Civil Action No. 6:13-cv-881-JDL, Eastern District
`of Texas
`
`10/20/2016
`
`10/20/2016
`
`Response to Office Action (Reexam Control No.
`90/009,513) (June 15, 2010)
`
`10/20/2016
`
`Notice of Intent to Issue Ex Parte Reexamination
`Certificate (Reexam Control No. 90/009,513)
`(Nov. 22, 2010)
`D-Link Annual Report, 2014
`
`D-Link Corporate Presentation, August 2013
`
`D-Link Annual Report, 2013
`Docket Sheet, Quad Powerline Tech. v. Actiontec
`Elec., Civil Action No. 2:14-cv-01166-JRG-RSP,
`Eastern District of Texas
`Docket Sheet, Via Vadis, et al. v. D-Link Sys., Inc.,
`Civil Action No. 1:14-cv-00812-LY, Western
`District of Texas
`Docket Sheet, Ericsson Inc. v. D-Link Corp., et al.,
`Civil Action No. 6:10-cv-00473-RWS, Eastern
`District of Texas
`Docket Sheet, Concinnitas, LLC, et al. v. D-Link
`Corp., et al., Civil Action No. 2:14-cv-01043-JRG-
`RSP, Eastern District of Texas
`
`10/20/2016
`
`10/20/2016
`10/20/2016
`10/20/2016
`
`10/20/2016
`
`10/20/2016
`
`10/20/2016
`
`10/20/2016
`
`– vii –
`
`

`
`Case No. IPR2016-01426
`U.S. Patent No. 9,019,838
`
`
`Chrimar
`System, Inc.
`Exhibit No.
`
`Exhibit Description
`
`Date Filed
`
`Docket Sheet, NorthPeak Wireless, LLC v. 3Com
`Corp., et al., Civil Action No. 5:08-cv-01813-IPJ,
`Northern District of Alabama
`Docket Sheet, Network-1 Sec. Sol., Inc. v. D-Link
`Corp., et al., Civil Action No. 6:05-cv-00291-LED,
`Eastern District of Texas
`Notice of Appearance of Counsel for Defendant D-
`Link Systems, Inc., Dkt. No. 64, Chrimar Sys.,
`Inc., et al. v. D-Link Sys., Inc., Civil Action No.
`6:15-cv-618-JRG-JDL, Eastern District of Texas
`Docket Sheet, Garnet Digital, LLC v. D-Link
`Systems, Inc., et al., Civil Action No. 6:13-cv-
`00648-LED, Eastern District of Texas
`Docket Sheet, Innovative Wireless Solutions, LLC v.
`K-Link Systems, Inc., Civil Action No. 8:13-cv-
`01814-CJC-AN, Central District of California
`
`10/20/2016
`
`10/20/2016
`
`10/20/2016
`
`10/20/2016
`
`10/20/2016
`
`2045
`
`2046
`
`2047
`
`2048
`
`2049
`
`
`
`– viii –
`
`

`
`Case No. IPR2016-01426
`U.S. Patent No. 9,019,838
`
`
`
`
`Introduction and Summary of Arguments
`
`Petitioner wrongly contends that certain claims of U.S. Patent No. 9,019,838
`
`(the “’838 Patent”) are rendered obvious in light of two alleged combinations:
`
`(1) Chang (U.S. Patent No. 5,991,885) and Patton (U.S. Patent No. 5,121,482); and
`
`(2) Hunter (WO 96/23377) and Bulan (U.S. Patent No. 5,089,927).1
`
`As an initial matter, the Petition fails because it does not name all of the real
`
`parties-in-interest. Petitioner’s parent company, D-Link Corporation, consistently
`
`and regularly retains counsel for and controls the defense of all patent suits brought
`
`against its subsidiary, D-Link Systems, Inc.—the only named Petitioner in this
`
`proceeding. In fact, the law firm representing Petitioner here is the same firm that
`
`has been retained by D-Link Corporation in nearly every (if not, in fact, every)
`
`patent suit brought against Petitioner in the past several years and that represents
`
`Petitioner in the underlying district court case. There is little doubt that D-Link
`
`Corporation is funding and controlling this proceeding. Accordingly, it should have
`
`been named as a real party-in-interest. Because D-Link Corporation was not named
`
`as a real party-in-interest, the Petition should be denied.
`
`
`1 The claims at issue are independent claim 1 and its dependent claims 2, 7,
`
`26, 40, 69.
`
`– 1 –
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`

`
`Case No. IPR2016-01426
`U.S. Patent No. 9,019,838
`
`
`Further, Petitioner has not met its burden to show a reasonable likelihood that
`
`one or more challenged claims of the ’838 Patent will be found unpatentable, as
`
`required by 35 U.S.C. § 314(a) and 37 C.F.R. § 42.108(c). Specifically, Petitioner
`
`has failed to make a prima facie case that the ’838 Patent is obvious in view of the
`
`combination of either Chang and Patton or Hunter and Bulan.
`
`With respect to Ground 1 of the Petition, the combination of Chang and
`
`Patton fails to teach or disclose all of the ’838 Patent’s claim limitations.
`
`Specifically, the claims require that at least one pair of contacts used to carry BaseT
`
`Ethernet communication signals on an Ethernet connector must: (1) carry
`
`“different magnitudes of DC current flow” in addition to the BaseT Ethernet
`
`communication signals; and (2) control the “application of at least one electrical
`
`condition . . . in response to at least one of the magnitudes of DC current flow.”
`
`Chang not only fails to disclose these limitations, it also (1) disavows the use of the
`
`same contacts used to carry Ethernet signals and (2) teaches away from applying
`
`electrical current to the Ethernet equipment. Ground 1 of the Petition should be
`
`rejected.
`
`Petitioner likewise fails to show that the combination of Hunter and Bulan,
`
`Ground 2 of the Petition, meets or discloses every limitation of the claims. Further,
`
`Petitioner has not shown that a person of ordinary skill in the art would have been
`
`– 2 –
`
`

`
`Case No. IPR2016-01426
`U.S. Patent No. 9,019,838
`
`motivated to combine Hunter and Bulan to create the inventions claimed in the
`
`’838 Patent. In fact, the two references actually teach away from such a
`
`combination because doing so would result in an unacceptable and unworkable
`
`network environment. Accordingly, Petitioner has not made a prima facie case that
`
`any claim of the ’838 Patent is obvious in light of Hunter and Bulan. The Board
`
`should reject Ground 2 of the Petition.
`
`This filing is timely under 35 U.S.C. § 313 and 37 C.F.R. § 42.107, as it is being
`
`filed within three months of the Notice dated mailed July 20, 2016, granting the
`
`Petition a filing date of July 13, 2016. While Patent Owner here addresses some
`
`limited aspects of the Petition, if instituted, Patent Owner expects to address these
`
`and other aspects of the petition in greater detail.
`
` Background
`A. Status of Related Litigation
`
`The ’838 Patent is currently one of four related patents2 asserted in litigation
`
`pending in the Eastern District of Texas against Petitioner: Chrimar Systems, Inc., et
`
`al. v. ADTRAN, Inc., et al., Case No. 6:15-cv-618. The court in that case construed
`
`certain terms of the ’838 Patent and denied defendants’ (including Petitioner)
`
`2 The four related patents are U.S. Patent Nos. 9,019,838 (Ex. 1001);
`
`8,942,107; 8,155,012; and 9,049,019.
`
`– 3 –
`
`

`
`Case No. IPR2016-01426
`U.S. Patent No. 9,019,838
`
`request to find certain claims of the ’838 Patent invalid as being indefinite.3 In
`
`other, earlier cases involving the ’838 Patent, the Court also construed certain
`
`terms of the ’838 Patent, and denied Defendants’ motions of summary judgment of
`
`invalidity.4 Trial is scheduled for January of 2017 against D-Link. In an earlier case
`
`
`3 Mem. Op. & Order, Chrimar Systems, Inc., et al. v. ADTRAN, Inc., et al., No.
`
`6:15-cv-618-JRG-JDL (E.D. Tex., June 20, 2016 (ECF No. 454)) (Ex. 1004-1).
`
`4 Mem. Op. & Order, Chrimar Systems, Inc., et al. v. AMX, LLC, No. 6:13-cv-
`
`881 (E.D. Tex. Oct. 22, 2014 (ECF No. 96)) (Ex. 2017); Mem. Op. & Order,
`
`Chrimar Systems, Inc., et al. v. AMX, LLC, No. 6:13-cv-881-JDL (E.D. Tex. Jan. 8,
`
`2015 (ECF No. 105)) (Ex. 2018); Mem. Op. & Order, Chrimar Systems, Inc., et al. v.
`
`AMX, LLC, No. 6:13-cv-881-JDL (E.D. Tex. Jan. 16, 2015 (ECF No. 108)) (Ex.
`
`2019); Mem. Op. & Order, Chrimar Systems, Inc., et al. v. Alcatel-Lucent, et al., No.
`
`6:15-cv-163-JDL (E.D. Tex. Mar. 28, 2016 (ECF No. 122)) (Ex. 2020); Mem. Op.
`
`& Order, Chrimar Systems, Inc., et al. v. Alcatel-Lucent, et al., No. 6:15-cv-163-JDL
`
`(E.D. Tex. Mar. 28, 2016 (ECF No. 123)) (Ex. 1001-2); Mem. Op. & Order,
`
`Chrimar Systems, Inc., et al. v. Alcatel-Lucent, et al., No. 6:15-cv-163-JDL (E.D. Tex.
`
`July 29, 2016 (ECF No. 223)) (Ex. 2034); Mem. Op. & Order, Chrimar Systems,
`
`– 4 –
`
`

`
`Case No. IPR2016-01426
`U.S. Patent No. 9,019,838
`
`involving the ’838 Patent, a jury trial was held against Alcatel-Lucent Enterprise,
`
`USA, Inc. (“ALE”) the week of October 3, 2016, resulting in a jury verdict in favor
`
`of Chrimar.5
`
`B. Chrimar
`
`Chrimar was founded in 1993 by Chris Young and Marshall Cummings.6 After
`
`learning about a number of thefts of networked equipment at the University of
`
`Michigan, where Mr. Cummings worked, the two began developing security
`
`solutions for networked equipment. While many in the industry focused on locking
`
`computers to desks and installing video surveillance systems, Messrs. Cummings
`
`and Young began focusing on an easily overlooked fact—these devices were already
`
`individually wired to the network by their own network cabling.
`
`In 1992, Messrs. Cummings and Young filed a patent application, which
`
`issued in 1995 as U.S. Patent No. 5,406,260 entitled “Network Security System for
`
`
`Inc., et al. v. Alcatel-Lucent, et al., No. 6:15-cv-163-JDL (E.D. Tex. Sept. 27, 2016
`
`(ECF No. 318)) (Ex. 2035).
`
`5 Chrimar Systems, Inc., et al. v. Alcatel-Lucent S.A., et al., Case No. 6:15-cv-
`
`163.
`
`6 Chrimar is a combination of “Chri” from Chris and “Mar” from Marshall.
`
`– 5 –
`
`

`
`Case No. IPR2016-01426
`U.S. Patent No. 9,019,838
`
`Detecting Removal of Electronic Equipment.”7 The ’260 Patent claimed
`
`inventions related to monitoring the physical connectivity of a piece of equipment
`
`(e.g., a computer) to a network using existing network wiring—even when the
`
`piece of equipment was powered off. Realizing the uniqueness and potentially
`
`broad appeal of this idea, Messrs. Cummings and Young founded Chrimar in 1993
`
`and began working on a commercial product they called EtherLock.
`
`In response to customer demand, Chrimar expanded and John Austermann
`
`joined the company in 1997 to oversee its general management and direct its sales
`
`and marketing efforts. He and Mr. Cummings began contemplating ideas to expand
`
`the company’s product offerings. They soon conceived of inventions related to
`
`managing, tracking, and controlling assets that physically connect to a network,
`
`which led to the ’838 Patent and six other granted patents—all of which claim
`
`priority to Chrimar’s provisional patent application dated April 10, 1998.8
`
`
`7 Ex. 1010, the “’260 Patent.”
`
`8 Those patents are U.S. Pat. Nos. 6,650,622; 7,457,250; 9,019,838;
`
`9,049,019; 8,902,760; and 8,942,107, each of which claims priority to provisional
`
`application no. 60/081,279 (Ex. 1005). U.S. Pat. No. 7,457,250 was subjected to a
`
`reexam, and all reexamined claims were confirmed as patentable.
`
`– 6 –
`
`

`
`Case No. IPR2016-01426
`U.S. Patent No. 9,019,838
`
`
`In early 1998, Chrimar began developing a new generation of products based
`
`on the inventions disclosed and claimed in those patents. And in the fall of 1998,
`
`Chrimar began selling new products that enabled physical control, tracking,
`
`management, and security of computer assets and network ports.
`
`C. The ’838 Patent
`
`The ’838 Patent is directed to methods and systems for managing devices
`
`connected in a star-wired Ethernet network. The claims “relate[] generally to
`
`computer networks and, more particularly, to a network management and security
`
`system for managing, tracking, and identifying remotely located electronic
`
`equipment on a network.”9 The “invention is particularly adapted to be used with
`
`an existing Ethernet communications link or equivalents thereof.”10
`
`More specifically, the patent discloses identifying an “asset,” such as a
`
`computer, “by attaching an external or internal device to the asset and
`
`communicating with that device using existing network wiring or cabling.”11 An
`
`asset can be managed, tracked, or identified by using a “remote module” to
`
`
`9 Ex. 1001: ’838 Patent at 1:227–30.
`
`10 Ex. 1001: ’838 Patent at 3:41–43.
`
`11 Ex. 1001: ’838 Patent at 2:4–6 (emphasis added).
`
`– 7 –
`
`

`
`Case No. IPR2016-01426
`U.S. Patent No. 9,019,838
`
`communicate information about the asset to a “central module.”12
`
`The basic configuration of an embodiment of the system claimed by the patent
`
`is illustrated in Figure 4, reproduced below with highlights and annotations.
`
`
`
`
`High-frequency data in an Ethernet network propagates between a hub (1) and
`
`a PC (3a) over two pairs of conductive cable lines—a pair of transmit cable lines,
`
`highlighted in green (conductors 1 & 2), and a pair of receive cable lines,
`
`highlighted in red (conductors 3 and 6). A central module (15a) and a remote
`
`module (16a) are placed between the hub and the PC, with the high-frequency data
`
`propagating through them. One novel aspect of the system is that the remote
`
`module can convey information about the PC to the central module wherein the
`
`information is carried by different magnitudes of DC current flowing through the
`
`same conductive cable lines as the high-frequency data without adversely affecting
`
`
`12 Ex. 1001: ’838 Patent at 3:27–32; 6:7–12; 8:64–9:5.
`
`– 8 –
`
`

`
`Case No. IPR2016-01426
`U.S. Patent No. 9,019,838
`
`the high-frequency data and/or the use of those cable lines for carrying high-
`
`frequency data. This is generally represented in the figure above by the black
`
`arrows between the central and remote modules. The different magnitudes of DC
`
`current convey information about the PC, and this can happen even when the PC is
`
`powered off.
`
` The central module has a direct connection to the remote module via a
`
`conventional Ethernet cable. More importantly, the central module can be
`
`connected to multiple remote modules. The diagram below shows an exemplary
`
`configuration consisting of a central module connected to four remote modules.
`
`
`This arrangement is commonly referred to as being part of a “star” or “hub
`
`and spoke” configuration, in which the central module has a direct electrical
`
`connection to the remote modules, allowing it to identify, communicate with, and
`
`manage each of the assets—as opposed to a “bus” configuration where
`
`communication cable lines (and thus the electrical connection) are shared among
`
`several devices.
`
`– 9 –
`
`

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`Case No. IPR2016-01426
`U.S. Patent No. 9,019,838
`
`
`This system allowed the patentees to solve a number of problems associated
`
`with prior-art asset-management systems. As the patent explains:
`
`[The prior art was] generally incapable of detecting the electrical
`
`connection status of equipment[;] it cannot detect the physical
`
`location of equipment, the identifying name of equipment is not
`
`permanent, and the monitored assets must be powered-up.
`
`Therefore, a method for permanently identifying an asset by
`attaching an external or internal device to the asset and
`communicating with that device using existing network
`wiring or cabling is desirable. . . . Such a device would allow a
`
`company to track its assets, locate any given asset, and count the
`
`total number of identified assets at any given time, thus
`
`significantly reducing its [total cost of ownership] of identified
`assets.13
`
`In short, the patentees were looking for a way to identify, communicate with,
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`and manage distributed assets in a network, over existing network wires, even when
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`the assets are powered off. The innovative devices, methods, and systems
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`described and claimed by the ’838 Patent achieve each of these goals. Specifically,
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`they are able to: (1) convey information about assets—e.g., a company’s
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`computers—over the same lines already being used to convey high-frequency data
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`13 Ex. 1001: ’838 Patent at 1:65–2:15 (emphasis added).
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`communications to the assets, without substantially interfering with the high-
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`frequency data communications14; and (2) convey information about the assets
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`even when the assets are powered off.15
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`D. Person of Ordinary Skill
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`A person of ordinary skill in the art with respect to the ’838 Patent would
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`have, at a minimum, an undergraduate degree or the equivalent in the field of
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`electrical engineering or a related ancillary field, and one to three years of
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`experience with data-communications networks, such as Ethernet networks.
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`Having experience with data-communications networks, such a person would also
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`be familiar with data-communications protocols and standards.
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`14 See, e.g., Ex. 1001: ’838 Patent at 12:3–5 (“The system transmits a signal
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`over pre-existing network wiring or cables without disturbing network communi-
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`cations . . . .”).
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`15 See, e.g., Ex. 1001: ’838 Patent at 5:4–6 (describing an embodiment of the
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`invention “capable of identifying the existence and location of network assets
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`without power being applied to the assets.”); id. at 12:54–56 (“[T]he system
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`provides a means for permanently identifying the location of network assets
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`without applying power to the assets.”).
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`
` Arguments and Authorities
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`A. Legal Standard
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`An inter partes review may be instituted only if “the information presented in
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`the petition . . . and any response . . . shows that there is a reasonable likelihood that
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`the petitioner would prevail with respect to at least 1 of the claims challenged in the
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`petition.” 35 U.S.C. § 314(a). The petitioner bears the burden of proof to
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`“demonstrate that there is a reasonable likelihood that at least one of the claims
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`challenged in the petition is unpatentable.” 37 C.F.R. § 42.108(c). At all stages of
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`the IPR, this burden of proof stays with the petitioner and never shifts to the patent
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`owner to prove the patentability of the challenged claims. See Dynamic Drinkware,
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`LLC v. Nat’l Graphics, Inc., 800 F.3d 1375, 1378–79 (Fed. Cir. 2015); see also Tietex
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`Int’l, Ltd. v. Precision Fabrics Group, Inc., IPR2014-01248, Paper 39 at 11 (2016).
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` When filing an IPR Petition, the petitioner must include sufficient evidence
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`and argument to meet its burden of proof. The petition must include “[a] full
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`statement of the reasons for the relief requested, including a detailed explanation of
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`the significance of the evidence including material facts, the governing law, rules,
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`and precedent.” 37 C.F.R. § 42.22(a)(2); see also 37 C.F.R. § 42.104 (requiring IPR
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`petitions to meet the requirements of §§ 42.6, 42.8, 42.22, and 42.23).
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`B. The Petition does not name all real parties-in-interest.
`1. Legal Standard
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`A petition for inter partes review “may be considered only if . . . the petition
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`identifies all real parties in interest. 35 U.S.C. § 312(a) (emphasis added). This
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`statutory requirement is a threshold issue on which Petitioner has the burden of
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`persuasion. See Reflectix, Inc. v. Promethean Insulation Tech. LLC, IPR2015-00039,
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`Paper 18 at 8 (2015); Zerto, Inc. v. EMC Corp., IPR2014-01254, Paper 35 at 6–7
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`(2015).
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`A real party-in-interest is a “party that desires review of the patent” or “at
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`whose behest the petition has been filed.” Office Patent Trial Practice Guide, 77
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`Fed. Reg. 48,756, 48,759 (Aug. 14, 2012) (“Trial Practice Guide”). Factors to
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`consider in deciding whether a nonparty is a real party-in-interest include the
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`nonparty’s “relationship with the petitioner” and “its relationship to the petition
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`itself, including the nature and/or degree of involvement in the filing; and the
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`nature of the entity filing the petition.” Id. at 48,759–60.
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`A common focus of the inquiry is whether the nonparty exercised or could
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`have exercised control over a party’s participation in the proceeding. Id. at 48,759
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`(citing Taylor v. Sturgell, 553 U.S. 880, 895 (2008)). The concept of control
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`generally means that “the nonparty has the actual measure of control or
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`opportunity to control that might reasonably be expected between two formal
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`coparties.” Id. (citation omitted). “The nonparty’s participation may be overt or
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`covert, and the evidence may be direct or circumstantial—so long as the evidence
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`as a whole shows that the nonparty possessed effective control over a party’s
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`conduct of the [proceeding] as measured from a practical, as opposed to a purely
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`theoretical standpoint.” Gonzalez v. Banco Central Corp., 27 F.3d 751, 759 (1st Cir.
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`1994).
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`“[T]here is no bright-line test,” however, “for determining the necessary
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`quantity or degree of participation to qualify as a ‘real [party-in-interest]’ . . . based
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`on the control concept.” Trial Practice Guide at 48,759 (citing Gonzalez, 27 F.3d at
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`759). “[A] party that funds and directs and controls” a petition or proceeding
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`constitutes a real party-in-interest, “[b]ut whether something less than complete
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`funding and control” is sufficient depends on the facts. Id. at 48,760.
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`2. D-Link Corporation is an unnamed real party-in-interest.
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`Petitioner D-Link Systems, Inc.’s parent company is D-Link Corporation, a
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`publicly held company organized under the laws of the Republic of China.16 D-Link
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`16 See D-Link Corporation’s Annual Report 2014, Notes to the consolidated
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`financial statements (Ex. 2038 at page 23 of the .pdf).
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`Corporation owns a 97.76% controlling interest in Petitioner,17 and it includes
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`Petitioner as a Consolidated Company in its consolidated financial statements, as
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`required by the Criteria Governing the Preparation of Affiliation Reports,
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`Consolidated Business Reports and Consolidated Financial Statements of Affiliated
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`Enterprises.18
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`D-Link Corporation controls Petitioner’s patent litigation. In this regard,
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`D-Link Corporation is in the business of designing and manufacturing networking
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`equipment.19 Petitioner’s business is limi