UNITED STATES PATENT AND TRADEMARK OFFICE
`
`______________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`______________
`
`
`TCT Mobile (US) Inc., Huizhou TCL Mobile Communication Co., Ltd., and
`Shenzhen TCL Creative Cloud Technology Co., Ltd.,
`
`Petitioners,
`
`v.
`
`ANCORA TECHNOLOGIES INC.,
`
`Patent Owner.
`
`______________
`
`
`U.S. Patent No. 6,411,941 B1
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`Case No. IPR2020-01609
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`______________
`
`
`
`
`
`PATENT OWNER’S PRELIMINARY RESPONSE TO PETITION
`FOR INTER PARTES REVIEW UNDER 37 C.F.R. § 42.107
`
`
`
`
`
`
`
`______________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`______________
`
`
`TCT Mobile (US) Inc., Huizhou TCL Mobile Communication Co., Ltd., and
`Shenzhen TCL Creative Cloud Technology Co., Ltd.,
`
`Petitioners,
`
`v.
`
`ANCORA TECHNOLOGIES INC.,
`
`Patent Owner.
`
`______________
`
`
`U.S. Patent No. 6,411,941 B1
`
`Case No. IPR2020-01609
`
`______________
`
`
`
`
`
`PATENT OWNER’S PRELIMINARY RESPONSE TO PETITION
`FOR INTER PARTES REVIEW UNDER 37 C.F.R. § 42.107
`
`
`
`
`
`
`
`Case No.: IPR2020-01609
`Patent No.: 6,411,941
`
`
`
`
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`TABLE OF CONTENTS
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`Atty. Dkt. No.: ANCC0120IPR
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`Table of Authorities ............................................................................................... ii
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`List of Exhibits ..................................................................................................... iii
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`I.
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`II.
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`Introduction ................................................................................................. 1
`
`Standard for granting Inter Partes review .................................................... 2
`
`III. Overview of the ‘941 Patent ........................................................................ 3
`
`IV. Claim Construction ...................................................................................... 6
`
`V.
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`The Board should deny the Petition for taking inconsistent claim
`construction positions and treating the claims like a “nose of wax” in
`violation of Rules 42.104(b)(3) and (4) .......................................................12
`
`VI. The Board should deny the Petition because the cited prior art fails to
`teach the claimed “license record” ..............................................................16
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`VII. Conclusion ..................................................................................................19
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`Certificate of Service ............................................................................................20
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`Certificate of Compliance Pursuant to 37 C.F.R. § 42.24 ......................................21
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`
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`
`
`
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`i
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`Case No.: IPR2020-01609
`Patent No.: 6,411,941
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`
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`Table of Authorities
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`Cases
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`Atty. Dkt. No.: ANCC0120IPR
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`Amazon.com, Inc. v. Barnesandnoble.com, Inc.,
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`239 F.3d 1343 (Fed. Cir. 2001) ...................................................................14
`
`Ancora Techs., Inc. v. Apple, Inc.,
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`744 F.3d 732 (Fed. Cir. 2014) ................................................................... 3, 5
`
`Ancora Techs., Inc. v. HTC Am., Inc.,
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`908 F.3d 1343 (Fed. Cir. 2018) ............................................................. 3, 4, 5
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`HTC Corp. v. Ancora Techs., Inc.,
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`No. CBM2017-00054, Institution Decision, Paper 7 (Dec. 1, 2017)............. 5
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`Kinetic Concepts, Inc. v. Smith & Nephew, Inc.,
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`688 F.3d 1342 (Fed. Cir. 2012) .................................................................... 2
`
`OrthoPediatrics Corp. v. K2M, Inc.,
`
`IPR2018-01548, Paper 9 (PTAB March 1, 2019) .................................. 14, 15
`
`Phillips v. AWH Corp.,
`
`415 F.3d 1303 (Fed. Cir. 2005) ......................................................... 9, 12, 13
`
`Statutes
`
`35 U.S.C. § 101 ..................................................................................................... 5
`35 U.S.C. § 103 ..................................................................................................... 2
`35 U.S.C. § 314 .......................................................................................... 2, 15, 18
`37 C.F.R. § 2.108 ................................................................................................... 2
`
`Other Authorities
`
`77 Fed. Reg. 48,756, 48,756 (Aug. 14, 2012)......................................................... 2
`83 Fed. Reg. 51,340, 51,355 (Oct. 11, 2018) .........................................................12
`
`37 C.F.R. § 42.104 .............................................................................. 12, 14, 15, 18
`
`
`Rules
`
`ii
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`
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`Atty. Dkt. No.: ANCC0120IPR
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`Date
`3/28/2002
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`11/12/2020
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`Identifier
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`
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`
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`Case No.: IPR2020-01609
`Patent No.: 6,411,941
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`
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`List of Exhibits
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`
`
`Exhibit
`No.
`2001
`
`Description
`‘941 Reasons for Allowance
`
`2002 Central District of California Claim
`Construction Order in Ancora Techs.,
`Inc. v. TCT Mobile, Inc. et al., 8:19-cv-
`02192 (CACD)
`
`2003
`
`Email from Canavera to Lorelli RE: CC
`Chart, including attachment
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`7/17/2020
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`
`
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`iii
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`Case No.: IPR2020-01609
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`I.
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`Introduction
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`Atty. Dkt. No.: ANCC0120IPR
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`Pursuant to 37 C.F.R. § 42.107, Patent Owner, Ancora Technologies, Inc.
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`(“Patent Owner”), submits the following Preliminary Response to the Petition for
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`Inter Partes Review of U.S. Patent No. 6,411,941 (“the ‘941 Patent”).
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`The Patent Trial and Appeal Board (the “Board”) should deny the Petition
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`for two reasons. First, Petitioner treats the claims as a “nose of wax” and asserts
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`completely inconsistent constructions in this proceeding and in the parallel district
`
`court proceeding. Here, Petitioner asserts the claims should be interpreted
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`according to their “plain and ordinary meaning” and that it “does not believe that
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`any claim constructions are needed.” Paper No. 1, p. 21. But in the parallel district
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`court litigation, Petitioner adopted some of the prior district court claim
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`constructions, disputed others with constructions of its own, and asserted new
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`constructions for previously-unconstrued claim terms Petitioner described as “most
`
`significant.” It cannot be that the same claim terms require construction (and have
`
`been construed) in the district court at Petitioner’s urging, but not in this
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`proceeding. The claim terms are the same, they are subject to the same claim
`
`construction standard, and Petitioner offers no reason for departing from the prior
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`district court constructions. Because Petitioner takes inconsistent positions in the
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`two proceedings and has failed to apply the district court constructions (or its own)
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`to the prior art, the Board should deny the petition.
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`Second, the Board should deny the Petition because the cited prior art lacks
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`the claimed “license record” as that term has been construed by three district
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`courts. Because Petitioner presents no reason for departing from the district court
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`construction(s), and because the prior art lacks the “license record” as properly
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`construed, there is no basis for instituting review.
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`For these two reasons, the Board should deny the Petition.
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`II.
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`Standard for granting Inter Partes review
`
`The Board may only grant a petition for inter partes review where “the
`
`information presented in the petition . . . shows that there is a reasonable likelihood
`
`that the petitioner would prevail with respect to at least 1 of the claims challenged
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`in the petition.” 35 U.S.C. § 314(a); 37 C.F.R. § 2.108(c). Petitioner bears the
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`burden of showing that this statutory threshold has been met. See Office Patent
`
`Trial Practice Guide, 77 Fed. Reg. 48,756, 48,756 (Aug. 14, 2012) [hereinafter
`
`“Practice Guide”] (“The Board . . . may institute a trial where the petitioner
`
`establishes that the standards for instituting the requested trial are met . . . .”).
`
`As to Petitioner’s claim of obviousness under 35 U.S.C. § 103, Petitioner
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`must show where each claim limitation (as properly construed) is found in the prior
`
`art. See, e.g., Kinetic Concepts, Inc. v. Smith & Nephew, Inc., 688 F.3d 1342, 1361
`
`(Fed. Cir. 2012). Failure to do so defeats a claim of obviousness. Id. The Office
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`Patent Trial Practice Guide specifies that among the many responses a patent
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`owner can submit to a petition include: “The prior art lacks a material limitation in
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`Atty. Dkt. No.: ANCC0120IPR
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`all of the independent claims.” Practice Guide, 77 Fed. Reg. at 48,764.
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`III. Overview of the ‘941 Patent
`
`The ’941 Patent relates to a specific technique for “identifying and
`
`restricting an unauthorized software program’s operation.” Ex. 1001 at 1:6-8.
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`Before the ’941 Patent, there were two basic methods of verifying and
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`restricting the operation of a program. One involved “software-based methods”
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`that “require[d] writing a license signature on the computer’s hard drive.” Ancora
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`Techs., Inc. v. HTC Am., Inc., 908 F.3d 1343, 1344 (Fed. Cir. 2018) (“HTC”). A
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`key “flaw in those methods,” however, “is that such a signature can be changed by
`
`hackers without damaging other aspects of computer functionality.” Id. citing Ex.
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`1001 at 1:19-26. Hardware-based methods also existed, but “require[d] inserting a
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`dongle into a computer port to authenticate the software authorization.” Id. citing
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`Ex. 1001 at 1:27-32. As a result, those “methods are costly, inconvenient, and not
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`suitable for software sold and downloaded over the internet.” Id.
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`The ’941 Patent improved over these prior art techniques by “using the
`
`memory space associated with the computer’s basic input/output system (BIOS),
`
`rather than other memory space, to store appropriately encrypted license
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`information to be used in the verification process.” Ancora Techs., Inc. v. Apple,
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`Inc., 744 F.3d 732, 733 (Fed. Cir. 2014), citing Ex. 1001 at 1:46-2:5, 4:45-48, and
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`5:19-24. Such BIOS memory space was and “is typically used for storing programs
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`that assist in the start-up of a computer.” HTC, 908 F.3d at 1345. Prior to the ’941
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`invention, however, it was not contemplated that operating system (“OS”) level
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`programs could interact with the BIOS at all—much less “us[e] an agent to setup a
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`verification structure in the erasable non-volatile memory area of the BIOS.” Ex.
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`2001, Reasons for Allowance at ANCC 408; HTC, 908 F.3d at 1348-49 (stating
`
`that “[t]he claimed method here specifically identifies how that functionality
`
`improvement is effectuated in an assertedly unexpected way: a structure containing
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`a license record is stored in a particular, modifiable, non-volatile portion of the
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`computer’s BIOS, and the structure in that memory location is used for
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`verification”).
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`As the Federal Circuit explained, using the BIOS in this unexpected manner
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`“improves computer security, . . . because successfully hacking BIOS memory
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`(i.e., altering it without rendering the computer inoperable) is much harder than
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`hacking the memory used by the prior art to store license-verification information.”
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`HTC, 908 F.3d at 1345. During examination, the Patent and Trademark Office
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`described the invention as proceeding against the conventional wisdom in the art to
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`do something “the closest prior art systems, singly or collectively,” never
`
`contemplated: “using an agent to set up a verification structure in the erasable,
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`non-volatile memory of the BIOS.” Ex. 2001, Examiner’s Reasons for Allowance
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`at ANCC 408.
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`The claims of the ’941 Patent have been extensively re-examined since the
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`Patent and Trademark Office’s original examination in 2002. In 2009, Microsoft
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`requested ex parte reexamination of the ‘941 patent. Control No. 90/010,560. In
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`that proceeding, the Patent and Trademark Office confirmed the patentability of all
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`19 claims of the ‘941 Patent.
`
`In 2012, Apple, Inc. challenged the claims of the ‘941 Patent as indefinite.
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`The Federal Circuit affirmed the district court’s finding that the claim terms
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`“volatile memory” and “non-volatile memory” were not indefinite. Ancora
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`Technologies, Inc. v. Apple, Inc., 744 F.3d 732, 737-739 (Fed. Cir. 2014).
`
`In 2017, the ’941 Patent was the subject of a petition for covered business
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`method review filed by HTC Corp. The Board denied institution, finding that the
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`’941 Patent was not a covered business method patent because it disclosed a
`
`technical solution in the form of storing the license record in the memory of the
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`BIOS. HTC Corp. v. Ancora Techs., Inc., No. CBM2017-00054, Institution
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`Decision, Paper 7, pp. 10–12 (Dec. 1, 2017).
`
`Most recently, in 2018, the ’941 Patent was the subject of an appeal to the
`
`Federal Circuit in Ancora Technologies, Inc. v. HTC Am., Inc., 908 F.3d 1343
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`(Fed. Cir. 2018). The Federal Circuit reversed the district court’s ruling that the
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`claims of the ’941 Patent were patent ineligible under 35 U.S.C. § 101.
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`Atty. Dkt. No.: ANCC0120IPR
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`IV. Claim Construction
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`Three different district courts have construed the challenged claims of the
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`‘941 Patent. The Northern District of California construed the claims in 2012. Ex.
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`1011. The Western District of Texas construed the claims in June and August
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`2020. Ex. 1012 and 1013. Most recently, on November 12, 2020, the Central
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`District of California construed the claims. Ex. 2002. Patent Owner asserts that
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`those district court constructions should be adopted for this proceeding for the
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`reasons stated in those claim construction decisions, and that all other claim terms
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`be given their plain and ordinary meaning.
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`Petitioner asserts that it “does not believe that any claim constructions are
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`needed” in this proceeding. Paper No. 1, p. 21. That assertion is inconsistent with
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`Petitioner’s claim construction assertions in the parallel district court litigation at
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`the time the Petition was filed. On July 17, 2020 – shortly before its Petition was
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`filed in this proceeding – the Petitioner submitted to the Central District of
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`California the following “AGREED” and “DISPUTED” claim constructions.
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`Agreed Claim Constructions:
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`Atty. Dkt. No.: ANCC0120IPR
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`Claim Term
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`non-volatile
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`memory area of
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`the BIOS
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`BIOS
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`Agreed Construction
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`Memory area of BIOS whose data is maintained when the
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`power is removed.
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`An acronym for Basic Input/Output System. It is the set of
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`essential startup operations that run when a computer is
`
`turned on, which test hardware, starts the operating system,
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`and support the transfer of data among hardware devices.
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`Ex. 1014, Ex. A (Dkt. # 49-1).
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`Disputed Claim Constructions:
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`Claim Term
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`Petitioner’s Construction
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`license record
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`information indicating a right to
`
`use the program
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`Patent Owner’s
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`Construction
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`A record from a licensed
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`program with information
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`for verifying that licensed
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`program (previous district
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`court construction)
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`set up a
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`verification
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`structure
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`store information encrypted with a
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`Plain and ordinary
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`key unique to the computer
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`meaning
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`Claim Term
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`Petitioner’s Construction
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`Patent Owner’s
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`Construction
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`selecting a
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`program residing
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`accessing a program to be verified
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`Plain and ordinary
`
`in the volatile
`
`in the volatile memory
`
`meaning
`
`memory
`
`a memory that: (i) stores the BIOS;
`
`memory of the
`
`BIOS
`
`(ii) is not recognized by an
`
`operating system as a storage
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`device; and (iii) does not have a
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`Plain and ordinary
`
`meaning
`
`file system
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`Ex. 1014, Ex. B (Dkt. # 49-2).
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`In correspondence leading up to the above district court filing, Petitioner
`
`described the disputed claim terms as terms that “will be most significant to this
`
`case.” Ex. 2003. But despite asserting multiple claim constructions in the district
`
`court, and despite asserting that they are the “most significant to this case,” the
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`Petitioner inexplicably asserted that it “does not believe that any claim
`
`constructions are needed” in this proceeding. Paper No. 1, p. 21.
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`The Petition also failed to address the fact that the construction Petitioner
`
`was seeking for “license record” in the district court proceeding was contrary to the
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`constructions that two district courts had entered long before the Petition was filed.
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`And since the Petition was filed, a third district court has now agreed with the
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`constructions of the first two district courts. The following table summarizes the
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`Atty. Dkt. No.: ANCC0120IPR
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`three district court constructions for the term “license record.”
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`District Court
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`Date
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`Claim Construction
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`Northern District
`
`of California
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`“a record from a licensed program with
`
`December 31, 2012
`
`information for verifying that licensed
`
`program” (Ex. 1011, pp. 16-18.)
`
`“data
`
`associated with
`
`a
`
`licensed
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`Western District
`
`June 2, 2020 and
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`program with information for verifying
`
`of Texas
`
`August 19, 2020
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`that licensed program” (Ex. 1012, p. 2;
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`Central District of
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`California
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`Ex. 1013, pp. 14-17.)
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`“a record from a licensed program with
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`November 12, 2020
`
`information for verifying that licensed
`
`program” (Ex. 2002, pp. 9-11.)
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`
`
`
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`In issuing the most recent construction, the Central District of California
`
`rejected Petitioner’s construction of “license record,” which was “information
`
`indicating a right to use the program.” (Ex. 2002, pp. 9-11.) The court held that
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`Patent Owner’s proposed construction (adopted from the Northern District of
`
`California) was consistent with the patent specification under Phillips, and
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`Petitioner’s proposed construction was not. Id. The district court supported its
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`construction of “license record” with the following analysis of the intrinsic record:
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`The specification shows that a license-record is any information from
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`a licensed program used by the verification structure to verify the
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`program. The specification states that a license-record “consists of
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`author name, program name and number of licensed users (for
`
`network),” and is associated with “each application program that is to
`
`be licensed to run on the specified computer.” ’941 Patent at 1:53-57.
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`The license record may be formed from fields or contents of the
`
`licensed program. See id. at 5:46-51; 6:7-10. The specification
`
`provides the following examples of contents used to form the license-
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`record: “terms, identifications, specifications, or limitations related to
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`the manufacturer of a software product, the distributor of a software
`
`product, the purchaser of a software product, a licensor, a licensee,
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`items of computer hardware or components thereof, or to other terms
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`and conditions related to the aforesaid.” Id. at 6:11-17. Further, “the
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`license record is not necessarily bound to continuous fields,” and the
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`license-record contents may be “centralized or decentralized” or
`
`“embedded in various locations in the application.” Id. at 5:35-39;
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`6:11. Thus, the information itself does not need to indicate anything
`
`so long as it is capable of being used to verify the program.
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`Figure 1 and its description confirm that the license-record is
`
`the information from the program used to verify the program.
`
`Describing Figure 1, the specification states that “[t]he second non-
`
`volatile memory includes a license-record-area (9) e.g. which contains
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`at least one encrypted license-record (e.g. three records 10-12),” while
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`“[t]he volatile memory accommodates a license program (16) having
`
`license record fields (13-15) appended thereto.” ’941 Patent at 5:26-
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`30. The license-record fields shown in Figure 1 are found at various
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`locations in the license program. See id., Fig. 1 (reproduced below).
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`The specification provides the following examples of the license-
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`record fields: “Application names (e.g. Lotus 123), Vendor name
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`(Lotus [I]nc.), and number of licensed copies (1 for stand alone usage,
`
`>1 for number of licensed users for a network application).” Id. at
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`5:30-34. The description and figure show that the license-record is
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`comprised of assorted
`
`information from
`
`the program without
`
`necessarily indicating a right to use the program.
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`Ex. 2002, pp. 9-10.
`
`
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`In issuing its construction of “license record,” the district court addressed
`
`how a person of ordinary skill in the art would have interpreted the term “license
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`record” in “the context of the entire patent.” Phillips v. AWH Corp., 415 F.3d
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`11
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`1303, 1313 and 1315 (Fed. Cir. 2005) (holding claims “must be read in view of the
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`specification,” which is “always highly relevant to the claim construction
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`analysis.”) The district court also provided sound reasons for rejecting Petitioner’s
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`proposed construction – a construction Petitioner does not advance in this
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`proceeding. Ex. 2002, pp. 10-11.
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`The Petition does not provide a construction of its own for the term “license
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`record” and it does not present a reason for departing from the constructions of the
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`three district courts. The three district court constructions are clearly relevant to the
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`Board’s evaluation of the Petition. See “Changes to the Claim Construction
`
`Standard for Interpreting Claims in Trial Proceedings Before the Patent Trial and
`
`Appeal Board,” 83 Fed. Reg. 51,340, 51,355 (Oct. 11, 2018) (“The PTAB will
`
`consider prior claim constructions from courts or the ITC, if timely made of record,
`
`and give them appropriate weight.”).
`
`V. The Board should deny the Petition for taking inconsistent claim
`construction positions and treating the claims like a “nose of wax”
`in violation of Rules 42.104(b)(3) and (4)
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`Rule 42.104(b)(3) states that a petition for inter partes review “must identify
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`. . . [h]ow the challenged claim is to be construed.” IPR Rule 42.104(b)(4)
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`separately states the petition “must identify . . . [h]ow the construed claim is
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`unpatentable.” Compliance with these rules is not optional.
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`The Petition states the claims are to be construed “in accordance with the
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`ordinary and customary meaning of such claim as understood by one of ordinary
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`skill in the art” and that Petitioner “does not believe that any claim constructions
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`are needed.” Paper 1 at 20-21 citing Phillips v. AWH Corp., 415 F.3d 1303, 1312-
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`13 (Fed. Cir. 2005) (en banc). But in its claim construction papers submitted to the
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`district court – pursuant to the same Phillips standard – the Petitioner asserted
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`more than six claim constructions, including constructions for “disputed” terms
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`that Petitioner contended were “most significant to this case.” Ex. 2003.
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`As explained above, Petitioner sought a much broader construction of the
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`term “license record” than two district courts (now three) had adopted. As
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`explained in detail below, the reason is because the prior art clearly lacks a “license
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`record” as the multiple district courts have construed that term.
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`With respect to three other claim limitations, Petitioner opposed the “plain
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`and ordinary meaning” it asserts in this proceeding, and instead sought much
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`narrower constructions in the district court proceeding. For example, Petitioner
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`proposed construing “memory of the BIOS” narrowly as “a memory that: (i) stores
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`the BIOS; (ii) is not recognized by an operating system as a storage device; and
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`(iii) does not have a file system.” Petitioner also proposed construing the phrase
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`“set up a verification structure” narrowly to mean “store information encrypted
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`with a key unique to the computer.” The Petitioner asserted that the construction of
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`these disputed claim terms “will be most significant to this case.” Ex. 2003. In this
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`13
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`Patent No.: 6,411,941
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`proceeding, however, Petitioner asserts the opposite – that it “does not believe that
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`Atty. Dkt. No.: ANCC0120IPR
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`any claim constructions are needed.” Paper No. 1, p. 21.
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`Petitioner is taking plainly conflicting positions in the two proceedings with
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`respect to the same claim terms construed according to the same standard. In doing
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`so, Petitioner improperly treats the claims as a “nose of wax” to suit its expedient
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`objectives in the two proceedings. See Amazon.com, Inc. v. Barnesandnoble.com,
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`Inc., 239 F.3d 1343, 1351 (Fed. Cir. 2001) (“A patent may not, like a nose of wax,
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`be twisted one way to avoid anticipation and another to find infringement.”)
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`(quotations and citations omitted).
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`If Petitioner intended to oppose (or adopt) the prior district court
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`constructions, or rely on its own constructions, it was incumbent upon the
`
`Petitioner to make that intention clear in its Petition. In OrthoPediatrics Corp. v.
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`K2M, Inc., IPR2018-01548, Paper 9, p. 11 (PTAB March 1, 2019), the Board held
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`“where Petitioner advocated for a different claim construction in the related district
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`court litigation, we determine that construction of the claim terms in dispute is
`
`necessary” and “[l]acking such claim construction, the Petition fails to comply
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`with 37 C.F.R. § 42.104(b)(3).”
`
`Keeping in mind that Petitioner has the burden to show a reasonable
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`likelihood of prevailing in showing that at least one claim is
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`unpatentable,
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`it
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`is
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`incumbent upon Petitioner
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`to address
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`substantively the District Court’s claim construction of a limitation
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`when construction of that limitation is likely to be a focal point of
`
`the inter partes review proceeding. By failing to reconcile its
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`proffered claim construction here with its very different construction
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`proffered in District Court . . . Petitioner fails to satisfy this burden.
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`Id., emphasis added.
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`If the “disputed” claim terms were “most significant to this case” in the
`
`underlying district court litigation as Petitioner asserted there (Ex. 2003), they were
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`most “likely to be a focal point of [this] inter partes review proceeding.” It was
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`thus “incumbent upon Petitioner to address substantively the District Court’s claim
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`construction[s]” in the petition. OrthoPediatrics, IPR2018-01548, Paper 9, p. 11.
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`By taking inconsistent claim construction positions in the district court and
`
`in this proceeding, by failing to provide any reasons why the district court claim
`
`constructions are erroneous, by failing to explain why its constructions asserted in
`
`the district court are proper, and by failing to apply any claim constructions
`
`whatsoever to the prior art, the Petition fails to comply with Rules 42.104(b)(3)
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`and (4). The Petition thus fails to show “that there is a reasonable likelihood that
`
`the petitioner would prevail with respect to at least 1 of the claims challenged in
`
`the petition.” 35 U.S.C. § 314(a). For this reason alone, the Board should deny
`
`institution of inter partes review in this proceeding.
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`VI. The Board should deny the Petition because the cited prior art
`fails to teach the claimed “license record”
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`Atty. Dkt. No.: ANCC0120IPR
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`The reason the Petition failed to apply the prior district court claim
`
`constructions is clear: the prior art does not disclose the claimed invention as
`
`construed. For example, the Northern District of California’s 2012 construction of
`
`the term “license record” is “a record from a licensed program with information
`
`for verifying that licensed program.” (Ex. 1011, pp. 16-18.) The Petitioner’s
`
`proposed construction in the litigation, which the Central District of California has
`
`since rejected, more broadly recites “information indicating a right to use the
`
`program.” Ex. 2002, pp. 9-11. The Petitioner’s now-rejected construction lacks the
`
`district court’s express requirements that the license record be (i) “from a licensed
`
`program” and (ii) include information for “verifying that license program.” The
`
`reason Petitioner opposed the district court constructions for the term “license
`
`record” is because the prior art Hellman reference fails to disclose the term as
`
`construed.
`
`The Petition asserts, for both Grounds I and II, that Hellman discloses the
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`“license record” recited in independent claim 1 of the ‘941 Patent. Paper No. 1 at
`
`38 and 47. Hellman describes a software distribution system that relies on a “base
`
`unit” in which a software application is installed for execution by a user. Ex. 1004,
`
`4:37-45. The base unit keeps track of how many times the software application is
`
`16
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`permitted to run on the base unit. Id. Hellman describes this counter as an “integer”
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`Atty. Dkt. No.: ANCC0120IPR
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`value “M” that is “between 0 and 254.” Ex. 1004, 10:42-43, 61. When “M” reaches
`
`0 through use of the software, the base unit prevents further use of the software
`
`(unless and until M is updated through an exchange between the base unit and the
`
`software manufacture). Ex. 1004, 5:57-66; 10:50-54.
`
`Figure 1 of
`
`the Hellman patent, reproduced below,
`
`illustrates
`
`the
`
`connectivity between the “base unit” 12, the “software” 17, and the manufacturer’s
`
`“authorization billing unit” 13.
`
`The Petition asserts for Ground I that “[t]he value ‘M’ is the required
`
`‘license record.’” Paper 1 at 38. For Ground II, the Petition similarly asserts that
`
`Hellman’s “authorized uses value M” meets the claimed “license record.” Paper 1
`
`
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`17
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`at 47.1 But as Hellman explains, M is merely an “integer” that reflects the number
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`Atty. Dkt. No.: ANCC0120IPR
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`of times a software application is permitted to run on a computer. Ex. 1004, 10:42-
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`43, 61. M does not include any information “from a licensed program” as the claim
`
`constructions in the Northern and Central Districts of California expressly require.
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`That is the reason why the Petition fails to comply with Rules 42.104(b)(3) and (4).
`
`That is the reason the Petitioner unsuccessfully sought a broader construction of
`
`the term “license record” in the parallel district court proceeding that was contrary
`
`to prior district court constructions.
`
`Because Hellman fails to disclose the “license record” limitation as properly
`
`construed, the Petition fails to show “that there is a reasonable likelihood that the
`
`petitioner would prevail with respect to at least 1 of the claims challenged in the
`
`petition.” 35 U.S.C. § 314(a). For this additional reason, the Board should deny
`
`institution of inter partes review in this proceeding.
`
`
`1 In Ground II, the Petition adds U.S. 5,933,498 to Schneck asserting “Schneck
`
`contains teachings relevant to various dependent claims.” Paper 1 at 42. The
`
`Petition relies on Schneck’s disclosure of encryption, stating “a POSA would have
`
`found it obvious to store the value M in Hellman (the required ‘license record’ in
`
`encrypted form.” Id. (italics in original).
`
`18
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`VII. Conclusion
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`Atty. Dkt. No.: ANCC0120IPR
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`Because Petition fails to dispute or apply the prior district court claim
`
`constructions, or Petitioner’s inconsistent constructions asserted in the district
`
`court, and because cited prior art fails to disclose the claimed “license record” as
`
`properly construed, the Board should deny the Petition for inter partes review of
`
`the ’941 Patent.
`
`
`
`
`
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`Dated: December 17, 2020
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`
`
`Respectfully submitted,
`
`
`
` /John S. LeRoy/
`John P. Rondini (Reg. No. 64,949)
`John S. LeRoy (Reg. No. 48,158)
`Marc Lorelli (Reg. No. 43,759)
`BROOKS KUSHMAN P.C.
`1000 Town Center, 22nd Floor
`Southfield, MI 48075
`(248) 358-4400
`
`Attorneys for Patent Owner
`Ancora Technologies Inc.
`
`
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`19
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`Case No.: IPR2020-01609
`Patent No.: 6,411,941
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`Atty. Dkt. No.: ANCC0120IPR
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`Certificate of Service
`
`The undersigned hereby certifies that on December 17, 2020, a copy of
`PATENT OWNER’S PRELIMINARY RESPONSE TO PETITION FOR
`INTER PARTES REVIEW UNDER 37 C.F.R. § 42.107 and all Exhibits, was
`served via electronic mail at PerkinsServiceTCL-Ancora-IPR@perkinscoie.com to
`the counsel of record listed below:
`
`
`LEAD COUNSEL
`John P. Schnurer (Reg. No. 52,196)
`Perkins Coie LLP
`11452 El Camino Real, Suite 300
`San Diego, CA 92130
`858-720-5700 (phone)
`858-720-5799 (fax)
`
`BACK-UP COUNSEL
`Yun (Louise) Lu (Reg. No. 72,766)
`Kyle R. Canavera (Reg. No. 72,167)
`Perkins Coie LLP
`11452 El Camino Real, S
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