Trials@uspto.gov
`571-272-7822
`
`
`
`
`Paper 16
`Entered: June 10, 2021
`
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`LG ELECTRONICS, INC. and LG ELECTRONICS U.S.A. INC.,
`Petitioner,
`v.
`ANCORA TECHNOLOGIES, INC.,
`Patent Owner.
`____________
`
`IPR2021-00581
`Patent 6,411,941 B1
`____________
`
`
`Before THU A. DANG, JONI Y. CHANG, and KEVIN W. CHERRY,
`Administrative Patent Judges.
`
`
`CHANG, Administrative Patent Judge.
`
`
`
`
`DECISION
`Denying Institution of Inter Partes Review
`35 U.S.C. § 314
`Denying Motion for Joinder
`35 U.S.C. § 315(c); 37 C.F.R. § 42.122
`
`
`
`
`
`
`
`571-272-7822
`
`
`
`
`Paper 16
`Entered: June 10, 2021
`
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`LG ELECTRONICS, INC. and LG ELECTRONICS U.S.A. INC.,
`Petitioner,
`v.
`ANCORA TECHNOLOGIES, INC.,
`Patent Owner.
`____________
`
`IPR2021-00581
`Patent 6,411,941 B1
`____________
`
`
`Before THU A. DANG, JONI Y. CHANG, and KEVIN W. CHERRY,
`Administrative Patent Judges.
`
`
`CHANG, Administrative Patent Judge.
`
`
`
`
`DECISION
`Denying Institution of Inter Partes Review
`35 U.S.C. § 314
`Denying Motion for Joinder
`35 U.S.C. § 315(c); 37 C.F.R. § 42.122
`
`
`
`
`
`
`
`
`IPR2021-00581
`Patent 6,411,941 B1
`
`
`INTRODUCTION
`I.
`LG Electronics, Inc. and LG Electronics U.S.A. Inc. (collectively,
`“Petitioner” or “Petitioner LG”) filed a Petition requesting an inter partes
`review (“IPR”) of claims 1−3, 6−14, and 16 (“the challenged claims”) of
`U.S. Patent No. 6,411,941 B1 (Ex. 1001, “the ’941 patent”). Paper 1
`(“Pet.”). Petitioner LG also filed a Motion for Joinder (Paper 3, “Mot.”),
`seeking to join as a party to TCT Mobile (US) Inc. v. Ancora Technologies,
`Inc. IPR2020-01609 (the “TCT IPR”), and a Reply (Paper 10, “Reply”).
`Ancora Technologies, Inc. (“Patent Owner”) filed an Opposition to
`Petitioner LG’s Motion for Joinder (Paper 9, “Opp.”), a Sur-reply (Paper 11,
`“Sur-reply”), and a Preliminary Response (Paper 14, “Prelim. Resp.”).
`For reasons discussed below, we do not institute an inter partes
`review of the challenged claims and deny the Motion for Joinder.
`
`A. Related Matters
`The parties indicate that the ’941 patent is involved in the following
`district court proceedings: Ancora Technologies, Inc. v. TCT Mobile (US)
`Inc., No. 8:19-cv-02192 (C.D. Cal.); Ancora Technologies, Inc. v. Lenovo
`Group Limited, No. 1:19-cv-01712 (D. Del.); Ancora Technologies, Inc. v.
`Sony Corp., No. 1:19-cv-01703 (D. Del.); Ancora Technologies, Inc. v. LG
`Electronics, Inc., No. 1:20-cv-00034 (W.D. Tex.) (the “LG case”); Ancora
`Technologies, Inc. v. Samsung Electronics Co., No. 6:19-cv-00385 (W.D.
`Tex.); and Ancora Technologies, Inc. v. HTC America, Inc., No. 2:16-cv-
`01919 (W.D. Wash.). Pet. 3−4; Paper 4, 1−2.
`
`2
`
`
`
`IPR2021-00581
`Patent 6,411,941 B1
`
`
`The ’941 patent also was involved in ex parte Reexamination No.
`90/010,560. Ex. 1001, 8−9 (Ex Parte Reexamination Certificate issued on
`June 1, 2010, confirming the patentability of claims 1−19 and indicating that
`no amendments have been made to the patent).
`In addition, the ’941 patent was involved in the following
`proceedings: Apple Inc. v. Ancora Technologies, Inc., CBM2016-00023
`(Institution Denied); HTC America, Inc. v. Ancora Technologies, Inc.,
`CBM2017-00054 (Institution Denied); Samsung Electronics Co., Ltd. v.
`Ancora Technologies, Inc., IPR2020-01184 (Institution Denied).
`The ’941 patent is currently involved in the following: TCT Mobile
`(US) Inc. v. Ancora Technologies, Inc., IPR2020-01609; HTC Corporation
`v. Ancora Technologies, Inc., IPR2021-00570; Samsung Electronics Co.,
`Ltd. v. Ancora Technologies, Inc., IPR2021-00583; and Sony Mobile
`Communications AB v. Ancora Technologies, Inc., IPR2021-00663.
`
`B. The ’941 patent
`The ’941 patent discloses a method of restricting software operation
`within a license limitation that is applicable for a computer having a first
`non-volatile memory area, a second non-volatile memory area, and a volatile
`memory area. Ex. 1001, code (57). According to the ’941 patent, the
`method includes the steps of selecting a program residing in the volatile
`memory, setting up a verification structure in the non-volatile memories,
`verifying the program using the structure, and acting on the program
`according to the verification. Id.
`
`3
`
`
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`IPR2021-00581
`Patent 6,411,941 B1
`
`
`Figure 1 of the ’941 patent is reproduced below.
`
`
`Figure 1 above shows a schematic diagram of computer processor 1
`and license bureau 7. Id. at 5:9−19. Computer processor 1 is associated
`with input operations 2 and output operations 3. Id. Computer processor 1
`contains first non-volatile memory area 4 (e.g., the ROM section of the
`Basic Input / Output System (“BIOS”)), second non-volatile memory area 5
`(e.g., the E2PROM section of the BIOS), and volatile memory area 6 (e.g.,
`the internal RAM memory of the computer). Id.
`
`C. Illustrative Claim
`Of the challenged claims, only claim 1 is independent. Claims 2, 3,
`6−14, and 16 directly or indirectly depend from claim 1. Claim 1 is
`illustrative:
`1. A method of restricting software operation within a license for
`use with a computer including an erasable, non-volatile memory
`area of a BIOS of the computer, and a volatile memory area; the
`method comprising the steps of:
`selecting a program residing in the volatile memory,
`4
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`
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`IPR2021-00581
`Patent 6,411,941 B1
`
`
`using an agent to set up a verification structure in the erasable,
`non-volatile memory of the BIOS, the verification structure
`accommodating data that includes at least one license record,
`verifying the program using at least the verification structure
`from the erasable non-volatile memory of the BIOS, and
`acting on the program according to the verification.
`Ex. 1001, 6:59:67–7:4.
`
`D. Prior Art Relied Upon
`Petitioner LG relies upon the references listed below (Pet. 5−6):
`
`Reference
`Hellman, U.S. Patent No. 4,658,093
`
`Exhibit No.
`Issue Date
`Apr. 14, 1987 Ex. 1004
`
`Chou, U.S. Patent No. 5,892,906
`
`Apr. 6, 1999 Ex. 1005
`
`Schneck, U.S. Patent No. 5,933,498
`
`Aug. 3, 1999 Ex. 1006
`
`
`
`
`
`E. Asserted Grounds of Unpatentability
`Petitioner LG asserts the following grounds of unpatentability (Pet. 6):
`
`Claims Challenged 35 U.S.C. §1
`
`References
`
`1, 2, 11, 13
`
`103(a)
`
`Hellman, Chou
`
`103(a)
`
`Hellman, Chou, Schneck
`
`1−3, 6−14, 16
`
`1 The Leahy-Smith America Invents Act (“AIA”), Pub. L. No. 112-29,
`125 Stat. 284, 287–88 (2011), amended 35 U.S.C. § 103. Because the
`’941 patent was filed before March 16, 2013, the effective date of the
`relevant amendment, the pre-AIA version of § 103 applies.
`5
`
`
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`IPR2021-00581
`Patent 6,411,941 B1
`
`
`II. ANALYSIS
`Discretionary Denial Under 35 U.S.C. § 314(a)
`“To join a party to an instituted IPR, the plain language of § 315(c)
`requires two different decisions.” Facebook, Inc. v. Windy City Innovations,
`LLC, 973 F.3d 1321, 1332 (Fed. Cir. 2020). First, we “determine whether
`the joinder applicant’s petition for IPR ‘warrants’ institution under § 314.”
`Id. Second, if the petition warrants institution, we then “decide whether to
`‘join as a party’ the joinder applicant.” Id. In short, before determining
`whether to join Petitioner LG as a party to the TCT IPR, we first determine
`whether the petition warrants institution under § 314(a).
`Institution of an inter partes review is discretionary. 35 U.S.C.
`§ 314(a). The Supreme Court of the United States has explained that,
`because § 314 includes no mandate to institute review, “the agency’s
`decision to deny a petition is a matter committed to the Patent Office’s
`discretion.” Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct. 2131, 2140
`(2016); see also Harmonic Inc. v. Avid Tech., Inc., 815 F.3d 1356, 1367
`(Fed. Cir. 2016) (explaining that under § 314(a), “the PTO is permitted, but
`never compelled, to institute an IPR proceeding”). The Director has
`delegated his authority under § 314(a) to the Board. 37 C.F.R. § 42.4(a)
`(“The Board institutes the trial on behalf of the Director.”).
`In this proceeding, Patent Owner argues that we should exercise
`discretion to deny institution under § 314(a) because each of the factors
`identified in Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 11 (PTAB
`
`6
`
`
`
`IPR2021-00581
`Patent 6,411,941 B1
`
`Mar. 20, 2020) (precedential) (“Fintiv”), weighs in favor of discretionary
`denial here. Opp. 16−21.
`
`In Fintiv, the Board ordered supplemental briefing on a nonexclusive
`list of factors for consideration in analyzing whether the circumstances of a
`parallel district court action are a basis for discretionary denial of trial
`institution under NHK Spring Co. v. Intri-Plex Techs., Inc., IPR2018-00752,
`Paper 8 (PTAB Sept. 12, 2018) (precedential). Fintiv, Paper 11 at 5−16.
`Those factors include:
`1. whether the court granted a stay or evidence exists that one
`may be granted if a proceeding is instituted;
`2. proximity of the court’s trial date to the Board’s projected
`statutory deadline for a final written decision;
`3. investment in the parallel proceeding by the court and the
`parties;
`4. overlap between issues raised in the petition and in the parallel
`proceeding;
`5. whether the petitioner and the defendant in the parallel
`proceeding are the same party; and
`6. other circumstances that impact the Board’s exercise of
`discretion, including the merits.
`Id. at 5−6. Here, we consider these factors to determine whether we should
`exercise discretion to deny institution. In evaluating the factors, we take a
`holistic view of whether efficiency and integrity of the system are best
`served by denying or instituting review. Fintiv, Paper 11 at 6.
`
`7
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`
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`IPR2021-00581
`Patent 6,411,941 B1
`
`
`Factor 1: whether the court granted a stay or evidence exists
`that one may be granted if a proceeding is instituted
`Patent Owner argues that no stay has been requested in the parallel
`district court proceedings, nor is one likely to be granted. Opp. 17. On the
`record before us, neither party has produced evidence that a stay has been
`requested or that the district court has considered a stay in the parallel
`litigation, the LG case. Therefore, we find that Factor 1 is neutral.
`
`Factor 2: proximity of the court’s trial date to the Board’s
`projected statutory deadline for a final written decision
`As the Board explained in Fintiv, “[i]f the court’s trial date is earlier
`than the projected statutory deadline, the Board generally has weighed this
`fact[or] in favor of exercising authority to deny institution under NHK.”
`Fintiv, Paper 11 at 9 (emphasis added). Here, as of the time of this Decision,
`the parallel trial in the LG case would appear to have already started, more
`than eight months before a Final Written Decision would be due in the
`proceeding which Petitioner seeks to join. Reply 7; Sur-reply 4; Ex. 2008
`(Fourth Amended Scheduling Order), 3; IPR2020-01609, Paper 7
`(Institution Decision entered on February 16, 2021). Therefore, this factor
`weighs against institution.
`
`Factor 3: investment in the parallel proceeding by the court
`and the parties
`Patent Owner argues that this factor weighs against institution because
`the facts in this case demonstrate extensive investment in the parallel
`proceedings. Opp. 18−19. We agree with Patent Owner. According to the
`
`8
`
`
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`IPR2021-00581
`Patent 6,411,941 B1
`
`Fourth Amended Scheduling Order in the parallel litigation, the parties have
`already finished claim construction and expert discovery, and dispositive
`motions including summary judgment are fully briefed. Ex. 2008, 3.
`Therefore, weighing the facts in this particular case, including the
`time invested by the parties and the district court in the parallel litigation, the
`extent to which the investment in the district court proceeding relates to
`issues of patent validity, and the timing of the filing of the Petition, we find
`that this factor weighs against institution.
`
`Factor 4: overlap between issues raised in the petition and in
`the parallel proceeding
`This factor evaluates “concerns of inefficiency and the possibility of
`conflicting decisions” when substantially identical prior art is submitted in
`both the district court and the inter partes review proceedings. Fintiv,
`Paper 11 at 12. In this regard, Petitioner LG argues that it “stipulates that if
`its joinder petition is instituted before the trial date of June 7, 2021, it will
`not subsequently assert invalidity in the district court on the same grounds
`asserted in the IPR or on the basis of the Hellman reference, either alone or
`in combination with any other reference.” Reply 7.
`Patent Owner counters that Petitioner LG’s stipulation will not avoid
`duplication of effort because it falls short of the stipulation in Sotera that
`includes “any other ground . . . that was raised or could have been
`reasonably raised in an IPR.” Sur-reply 3−4 (citing Sotera Wireless, Inc. v.
`Masimo Corp., IPR2020-01019, Paper 12 at 18−19 (PTAB Dec. 1, 2020)
`(precedential).
`
`9
`
`
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`IPR2021-00581
`Patent 6,411,941 B1
`
`
`We agree with Patent Owner that there is a significant overlap
`between the issues raised in the Petition and in the parallel district court
`proceeding. Petitioner LG’s stipulation, however, somewhat mitigates the
`“concerns of inefficiency and the possibility of conflicting decisions.”
`We note that Petitioner LG’s stipulation is narrow, not a broad stipulation
`that includes “any ground raised, or that could have been reasonably
`raised.” See Sotera, Paper 12 at 19; see also Sand Revolution II, LLC v.
`Continental Intermodal Group – Trucking LLC, IPR2019-01393, Paper 24 at
`12 n.5 (PTAB June 16, 2020) (informative) (noting that a broad stipulation
`better addresses concerns of duplicative efforts and potentially conflicting
`decisions in a much more substantial way). Therefore, we find that this
`factor weighs marginally against denying institution.
`
`Factor 5: whether the petitioner and the defendant in the
`parallel proceeding are the same party
`“If a petitioner is unrelated to a defendant in an earlier court
`proceeding, the Board has weighed this fact against exercising discretion to
`deny institution under NHK.” Fintiv, Paper 11 at 13–14 (emphasis added).
`Where the petitioner is also a defendant in an earlier court proceeding, this
`factor has generally weighed in favor of discretionary denial. Sand
`Revolution, Paper 24 at 12−13. Here, it is undisputed that Petitioner LG is a
`co-defendant in the parallel litigation. Pet. 3. Therefore, this factor weighs
`in favor of denying institution.
`
`10
`
`
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`IPR2021-00581
`Patent 6,411,941 B1
`
`
`Factor 6: other circumstances that impact the Board’s exercise
`of discretion, including the merits.
`The final Fintiv factor is a catch-all that takes into account any other
`relevant circumstances. The decision whether to exercise discretion to deny
`institution under § 314(a) is based on “a balanced assessment of all relevant
`circumstances in the case, including the merits.” Consolidated Trial Practice
`Guide 58. A full merits analysis is not necessary as part of deciding whether
`to exercise discretion not to institute, but rather the parties may point out, as
`part of the factor-based analysis, particular “strengths or weaknesses” to aid
`the Board in deciding whether the merits tip the balance one way or another.
`See Fintiv, Paper 11 at 15−16.
`Petitioner LG argues that “the Board has already determined that
`there is a reasonable likelihood that the [’941] patent is invalid.” Reply 7.
`But, the mere fact that a party may have met its institution burden is not the
`same as an argument as to the particular strengths (or weaknesses) of the
`challenged. Based on this preliminary record and absence of substantive
`argument highlighting any particular strengths of the challenge, we find that
`Factor 6 of Fintiv is neutral.
`
`Conclusion on Discretionary Denial under § 314(a)
`As noted in Fintiv, we consider the above six factors when taking “a
`holistic view of whether efficiency and integrity of the system are best
`served by denying or instituting review.” Fintiv, Paper 11 at 6. As
`discussed above, Factors 1 and 6 are neutral, Factors 2, 3, and 5 weigh in
`favor of exercising our discretion to deny institution, and Factor 4 weighs
`
`11
`
`
`
`IPR2021-00581
`Patent 6,411,941 B1
`
`marginally against exercising our discretion to deny institution.
`Accordingly, we exercise our discretion under § 314(a) to deny institution of
`this proceeding.
`
`III. DENIAL OF MOTION FOR JOINDER
`As stated above, the Director may join a party to an ongoing IPR only
`if the later-filed petition warrants institution under § 314(a). 35 U.S.C.
`§ 315(c). Because we are exercising discretion to deny institution under
`§ 314(a), we deny Petitioner LG’s Motion for Joinder.
`
`IV. ORDER
`
`Accordingly, it is
`ORDERED that, pursuant to 35 U.S.C. § 314(a), the Petition is
`denied; and
`FURTHER ORDERED that the Motion for Joinder is denied.
`
`
`
`
`
`
`
`
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`
`
`
`
`12
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`
`
`IPR2021-00581
`Patent 6,411,941 B1
`
`PETITIONER:
`
`David McCombs
`Gregory Huh
`HAYNES AND BOONE, LLP
`david.mccombs.ipr@haynesboone.com
`gregory.huh.ipr@haynesboone.com
`
`
`PATENT OWNER:
`Nicholas Peters
`David Gosse
`Paul Henkelmann
`FITCH, EVEN, TABIN & FLANNERY LLP
`ntpete@fitcheven.com
`dgosse@fitcheven.com
`phenkelmann@fitcheven.com
`
`John Rondini
`BROOKS KUSHMAN P.C.
`jrondini@brookskushman.com
`
`
`
`
`13
`
`
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