Case 1:23-cv-00324-ADA Document 235 Filed 11/06/24 Page 1 of 24
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`UNITED STATES DISTRICT COURT
`FOR THE WESTERN DISTRICT OF TEXAS
`AUSTIN DIVISION
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`CARBYNE BIOMETRICS, LLC,
`Plaintiff,
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`APPLE INC.,
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`v.
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`Defendant.
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`Case No. 1:23-CV-00324-ADA
`JURY TRIAL DEMANDED
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`DEFENDANT APPLE INC.’S OPPOSED MOTION TO STRIKE THE OPINIONS OF
`CARBYNE BIOMETRICS, LLC’S SURVEY EXPERT, DR. REBBECCA REED-
`ARTHURS, UNDER FED. R. EVID. 702 AND DAUBERT
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`Case 1:23-cv-00324-ADA Document 235 Filed 11/06/24 Page 2 of 24
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`TABLE OF CONTENTS
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`Page
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`BACKGROUND ................................................................................................................ 2 
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`LEGAL STANDARD ......................................................................................................... 4 
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`I. 
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`II. 
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`III. 
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`ARGUMENT ...................................................................................................................... 5 
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`A. 
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`The CBC Survey is not Tied to the Claimed Patented Functionalities and
`Therefore Would Only Confuse the Trier of Fact .................................................. 5 
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`1. 
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`2. 
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`The Authentication Patents do not Claim “Passkeys,” and the Next
`Best Non-Infringing Alternative is not “Passwords.” ................................. 6 
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`The Description of the Fraud Patents Omits Key Required
`Functionality and Covers Innumerable Non-Infringing Alternatives ....... 12 
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`IV. 
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`CONCLUSION ................................................................................................................. 17 
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`Case 1:23-cv-00324-ADA Document 235 Filed 11/06/24 Page 3 of 24
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`TABLE OF AUTHORITIES
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`Page(s)
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`Cases
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`Apple, Inc. v. Samsung Elecs. Co.,
`No. 12-CV-00630, 2014 WL 794328 (N.D. Cal. Feb. 25, 2014) ..............................................5
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`Bourjaily v. United States,
`483 U.S. 171 (1987) ...................................................................................................................4
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`Daubert v. Merrell Dow Pharms., Inc.,
`509 U.S. 579 (1993) ...............................................................................................................4, 5
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`Finjan, Inc. v. Blue Coat Sys., Inc.,
`879 F.3d 1299 (Fed. Cir. 2018)..................................................................................................4
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`Fractus, S.A. v. Samsung,
`No. 09-cv-203, 2011 WL 7563820 (E.D. Tex. Apr. 29, 2011)........................................ passim
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`Kumho Tire Co. v. Carmichael,
`526 U.S. 137 (1999) ...................................................................................................................5
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`Scrum Alliance, Inc. v. Scrum, Inc.,
`No. 20-cv-227, 2021 WL 1691136 (E.D. Tex. Apr. 29, 2021)..................................................5
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`Unwired Planet, LLC v. Apple Inc.,
`No. 13-cv-04134, 2017 WL 589195 (N.D. Cal. Feb. 14, 2017) ................................................5
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`Statutes
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`35 U.S.C. § 284 ..............................................................................................................................18
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`Other Authorities
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`Fed. R. Evid. 702 .........................................................................................................................4, 5
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`Case 1:23-cv-00324-ADA Document 235 Filed 11/06/24 Page 4 of 24
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`TABLE OF EXHIBITS
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`Exhibit
`Ex. A
`Ex. B
`Ex. C
`Ex. D
`Ex. E
`Ex. F
`Ex. G
`Ex. H
`Ex. I
`Ex. J
`Ex. K
`Ex. L
`Ex. M
`Ex. N
`Ex. O
`Ex. P
`Ex. Q
`Ex. R
`Ex. S
`Ex. T
`Ex. AA
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`Document
`August 21, 2024, Expert Report of Dr. Rebbecca Reed-Arthurs
`August 21, 2024, Expert Report of Justin R. Blok
`Deposition Transcript of Rebbecca Reed-Arthurs, October 2, 2024
`Deposition Transcript of Mark Jones, October 1, 2024
`Joint Stipulation of Dismissal
`Appendix D to Jones Opening Expert Report
`Appendix E to Jones Opening Expert Report
`September 18, 2024, Rebuttal Expert Report of Mark Jones
`August 21, 2024, Expert Report of Seth Neilson
`Appendix A to Jones Rebuttal Expert Report
`September 18, 2024 Rebuttal Expert Report of Seth Neilson
`September 18, 2024, Rebuttal Expert Report of Eric Cole
`Deposition Transcript of Markus Jakobsson, July 9, 2024
`August 21, 2024, Expert Report of Eric Cole
`Deposition Transcript of Eric Cole, October 16, 2024
`September 18, 2024, Rebuttal Expert Report of Edward Dunstone
`File History of ’138 Patent
`File History of ’105 Patent
`Deposition Transcript of Justin Blok, October 4, 2024
`August 21, 2024, Expert Report of Mark Jones
`August 21, 2024, Expert Report of Edward Dunstone
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`Case 1:23-cv-00324-ADA Document 235 Filed 11/06/24 Page 5 of 24
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`Defendant Apple Inc. (“Apple”) respectfully moves to exclude the opinions of Carbyne
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`Biometrics, LLC’s (“Carbyne”) survey expert, Dr. Rebbecca Reed-Arthurs, pertaining to her
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`Choice Based Conjoint survey (“CBC Survey”) because her opinions are untethered to the facts of
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`the case and thus wholly unreliable. The purpose of a conjoint survey is to determine the price
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`consumers would pay for the infringing technology versus the next best non-infringing alternative.
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`Reed-Arthurs Report (Ex. A) ¶¶ 54-56. Dr. Reed-Arthurs’ CBC Survey fails to measure that price.
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`Instead, the survey measures the price consumers would pay for technology that the parties
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`agree is far broader than what the Asserted Patents actually claim. The purportedly infringing
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`options presented to consumers subsume numerous available, acceptable, already implemented,
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`and widely used non-infringing alternatives. As such, Dr. Reed-Arthurs did not test how
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`consumers actually value the patented features as separated from the unpatented ones. Dr. Reed-
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`Arthurs’ CBC Survey therefore cannot be used to determine the value attributable to the
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`technology claimed by the Patents-in-Suit and should be excluded as unhelpful and confusing to
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`the jury.
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`Further compounding the problems with Dr. Reed-Arthurs’ CBC Survey, Mr. Justin Blok,
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`Carbyne’s damages expert, uses the results of the CBC Survey as the sole starting point for his
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`apportionment analysis. His opinions relying on this survey should likewise be excluded as
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`untethered to the footprint of the invention. To put it simply, when a survey—which is the sole
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`starting point for a technical apportionment analysis—measures the value of functionality so
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`different from and broader than the claimed technology that it encompasses many of the next best
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`non-infringing alternatives, the results of that survey cannot be adjusted or manipulated to support
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`a technical apportionment analysis because they are irreparably divorced from the footprint of the
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`patented invention. See Apple’s Motion to Strike Expert Opinions of Justin Blok, dated October
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`Case 1:23-cv-00324-ADA Document 235 Filed 11/06/24 Page 6 of 24
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`30, 2024 (“Blok MTS”), filed concurrently herewith. Thus, Apple respectfully requests that the
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`Court strike and exclude the CBC Survey and all expert opinions and testimony based thereon.
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`I.
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`BACKGROUND
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`Carbyne asserts that Apple infringes U.S. Patent Nos. 11,475,105 (“the ’105 Patent”), and
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`11,514,138 (“the ’138 Patent") (the “Authentication Patents”) and U.S. Patent Nos. 9,972,010
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`(“the ’010 Patent”), 10,713,656 (“the ’656 Patent”), and 11,526,886 (“the ’886 Patent”) (the
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`“Fraud Reduction Patents”) (collectively, the “Asserted Patents”). On August 21, 2024, Carbyne
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`served an expert report from Dr. Reed-Arthurs (the “Reed-Arthurs Report”), which purported to
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`value the patented technology by determining the price that
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` consumers would be willing
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`to pay for certain functionalities, as compared to what Carbyne characterizes as the next best non-
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`infringing alternative. Reed-Arthurs Report (Ex. A) ¶¶ 49-50, 56.
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`The Reed-Arthurs Report purports to determine consumer willingness-to-pay for the
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`accused functionalities using a choice-based conjoint or “CBC” survey. Id. ¶ 49. Dr. Reed-Arthurs
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`describes the conjoint analysis as follows:
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`Each respondent is presented with a set of hypothetical products that
`vary with respect to several features and is then asked which of the
`products he or she prefers . . . . Each feature can take different
`attribute levels… The survey respondent is then asked to select the
`[product] that he or she would prefer or be most likely to purchase .
`. . . Respondents are asked to answer multiple questions of this type,
`each using different combinations of attribute levels. The resulting
`data can then be used to estimate how much respondents are willing
`to pay for the included features.
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`Id. ¶¶ 49-50. “[T]he full descriptions used in the [CBC Survey] of the peer-to-peer payment
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`security and sign-in security features” were “designed to encapsulate the patent practicing features
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`and the next best non-infringing alternative to those features.” Id. ¶ 56.
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`The survey describes the Fraud Patents as providing “Peer-to-Peer Payment Security,” and
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`further characterizes the specific technology claimed by the Fraud Patents as providing an
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`Case 1:23-cv-00324-ADA Document 235 Filed 11/06/24 Page 7 of 24
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`“Aliveness Check” (’010 and ’656 Patents) or a combined “Aliveness Check” and “Location
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`Check” (’886 Patent).1 Id. ¶¶ 56, 127. The survey characterizes the next best non-infringing
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`alternative to the ’010 and ’656 Patents as simply “biometric only” Peer-to-Peer Payment Security
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`(i.e., no “Aliveness Check”), and as “Aliveness Check” without “Location Check” for the ’886
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`Patent. Id. ¶ 18; Fig. 5:
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`The survey describes the Authentication Patents as providing “Sign-In Security,” and
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`further characterizes the specific technology claimed by both of the Authentication Patents as
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`simply “Passkeys.” Id. ¶¶ 56, 127. The survey instrument characterizes the next best non-
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`infringing alternative to both of the Authentication Patents as “Passwords.” Id. ¶ 14; Fig. 5:
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`1 As discussed below, the survey instrument omits fully one-half of the claimed requirements of the Fraud Patents,
`namely,
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`Case 1:23-cv-00324-ADA Document 235 Filed 11/06/24 Page 8 of 24
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`Dr. Reed-Arthurs took the choices made by respondents of the CBC Survey and translated
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`those choices into estimates of the value that respondents place on the accused features relative to
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`the purported next-best non-infringing alternative. Id. ¶¶ 119, 134-40. Using the results of the
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`CBC Survey, Dr. Reed-Arthurs determined consumer willingness-to-pay for the collective
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`functionality of the Authentication Patents was between
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` per device. Id. at 280.
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`With respect to the Fraud Patents, she determined willingness-to-pay for the “Aliveness Check”
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`functionality was between
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` and willingness-to-pay for the “Aliveness Check +
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`Location Check” functionality was between
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` per device. Id.
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`Carbyne’s damages expert, Justin Blok, used those willingness-to-pay values resulting
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`from Dr. Reed-Arthurs’ CBC Survey as the sole input for his technological apportionment analysis
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`in his damages opinions. Blok Report (Ex. B) ¶ 200; Blok Tr. (Ex. S) at 45:18-47:12.
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`II.
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`LEGAL STANDARD
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`“Expert evidence can be both powerful and quite misleading.” Daubert v. Merrell Dow
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`Pharms., Inc., 509 U.S. 579, 595 (1993) (citation omitted). Thus, district courts are charged with
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`a “gatekeeping role” to ensure that expert testimony admitted into evidence is both reliable and
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`relevant to the case. See Fed. R. Evid. 702. The proponent of expert evidence carries the burden
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`of establishing admissibility “by a preponderance of the evidence.” Bourjaily v. United States,
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`483 U.S. 171, 174-76 (1987); Finjan, Inc. v. Blue Coat Sys., Inc., 879 F.3d 1299, 1310 (Fed. Cir.
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`2018). The court’s determination of whether the proponent meets this burden is reviewed for
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`Case 1:23-cv-00324-ADA Document 235 Filed 11/06/24 Page 9 of 24
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`“abuse-of-discretion.” Kumho Tire Co. v. Carmichael, 526 U.S. 137, 152 (1999). Like other
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`expert evidence, surveys are subject to Daubert scrutiny. Scrum Alliance, Inc. v. Scrum, Inc., No.
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`20-cv-227, 2021 WL 1691136, at *1, *3 (E.D. Tex. Apr. 29, 2021). Survey evidence not “tied
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`directly to [p]laintiff’s technology confuses the issues and must be excluded.” Fractus, S.A. v.
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`Samsung, No. 09-cv-203, 2011 WL 7563820, at *1 (E.D. Tex. Apr. 29, 2011). Moreover,
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`“admissible expert testimony must ‘carefully tie proof of damages to the claimed invention’s
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`footprint in the market place.’” Id. (citation omitted).
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`III. ARGUMENT
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`A.
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`The CBC Survey is not Tied to the Claimed Patented Functionalities and
`Therefore Would Only Confuse the Trier of Fact
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`Rule 702 requires that an expert’s “scientific, technical, or other specialized knowledge
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`will help the trier of fact to understand the evidence or to determine a fact in issue.” Fed. R. Evid.
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`702(a). Dr. Reed-Arthurs’ opinions as to the CBC Survey do not meet this standard at least
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`because the survey is not tied to the footprint of the alleged inventions claimed by the Asserted
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`Patents and therefore does not test their value. Multiple courts have excluded conjoint survey
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`analysis for this same reason. See, e.g., Fractus, 2011 WL 7563820, at *1 (excluding survey
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`evidence related to the “value of internal antennas not tied directly to [p]laintiff’s technology”
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`because it “confuses the issues”); Unwired Planet, LLC v. Apple Inc., No. 13-cv-04134, 2017 WL
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`589195, at *1 (N.D. Cal. Feb. 14, 2017) (excluding a survey where the “survey question—and
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`survey responses—targeted at an invention other than the one at issue in this litigation”); cf. Apple,
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`Inc. v. Samsung Elecs. Co., No. 12-CV-00630, 2014 WL 794328, at *18 (N.D. Cal. Feb. 25, 2014)
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`(where a survey’s description of patented features “may vary so much from what is claimed that
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`the survey no longer ‘relate[s] to any issue in the case’ and is ‘not relevant and, ergo, non-helpful’
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`[to the trier of fact],” the survey “must be excluded under Rule 702(a)” (alteration in original)
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`Case 1:23-cv-00324-ADA Document 235 Filed 11/06/24 Page 10 of 24
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`(citation omitted)). Instead of testing how consumers value the patented technology, Dr. Reed-
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`Arthurs CBC Survey tests for consumer willingness-to-pay for features that the parties agree do
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`not infringe the Asserted Patents and do not represent the claimed invention, instead covering
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`different technology so broad as to subsume many available, acceptable, already-implemented and
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`widely used non-infringing alternatives. See Reed-Arthurs Tr. (Ex. C) at 204:17-205:17. This
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`renders the CBC Survey, and any opinions based thereon, untethered to the claimed technology in
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`this case and thus unreliable, confusing to the factfinder, and highly prejudicial to Apple.
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`1.
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`The Authentication Patents do not Claim “Passkeys,” and the Next Best
`Non-Infringing Alternative is not “Passwords.”
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`The CBC Survey and any opinions derived therefrom are fundamentally flawed and
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`unreliable because they do not test the value of the patented technology, but instead test the value
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`of technology far broader than the claims cover. They are therefore not admissible. Fractus, 2011
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`WL 7563820, at *1 (excluding survey evidence where survey description was broader than and
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`thus not tied directly to plaintiff’s technology).
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`Dr. Reed-Arthurs’ survey compared the value of “passwords” (non-infringing) and
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`“Passkeys” (purportedly infringing). Passwords are described as
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` Reed-Arthurs Report (Ex. A) at 230. And Passkeys are described as
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` Id.
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`Case 1:23-cv-00324-ADA Document 235 Filed 11/06/24 Page 11 of 24
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`The CBC Survey’s descriptions of passwords and Passkeys are not tied to the
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`Authentication Patents. In fact, Dr. Jones expressly disagreed with Dr. Reed-Arthur’s
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`characterization of the patents. Compare Reed-Arthurs Report (Ex. A) ¶ 12
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`), with Jones Tr. (Oct. 1, 2024) (Ex. D) (9:6-12) (“Q.
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`The main problem with the CBC Survey descriptions is that because of its breadth and lack
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`of alignment with what is actually claimed, the description of Passkeys includes many non-
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`infringing alternatives and describes a benefit (
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`) that does not result from the patented invention. For example, the claims
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`recite 1) the use of “at least one record” that includes both a cryptographic key and biometric
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`template (all asserted claims); 2) the manner of prompting the user to enter biometric input (’138
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`claims 1 and 25); 3) the manner of initiating backups of the record (’105 claims 1 and 35); 4) the
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`manner of wiping the record and its contents (’138 claims 1 and 25). Indeed, Dr. Jones highlights
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`these features of the Authentication Patents and acknowledged each were necessary to evaluate
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`the purported benefit provided by a claim. See, e.g., Jones Rebuttal App. A (Ex. J) ¶¶ 8-9, 11
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`(highlighting wiping and same brand backups); Jones Tr. (Ex. D) (130:17-131:1) (“Q . . . . Is it fair
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`to say that the technical benefit of a patent should be the benefit from the claim as a whole, not
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`from any individual limitation? . . . A: [The] technical benefits of a claim have to be considered
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`within the context of the entire claim. I think you could address specific limitations, but I believe
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`Case 1:23-cv-00324-ADA Document 235 Filed 11/06/24 Page 12 of 24
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`the entire claim should be considered.”). However, the CBC Survey did not limit the “infringing”
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`option with any of these four requirements.
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`The second and third limitations are particularly significant. These limitations were key to
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`overcoming the Examiner’s rejections during prosecution, indicating that those limitations are
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`critical to the purported novelty of the claims. The claims of the ’138 patent, for example, were
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`allowed only after applicant amended them to additionally recite presenting a “prompt to provide
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`biometric information, and wherein the prompt is visually presented.” Ex. Q (’138 File History)
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`at Carbyne001108-13 (6/29/22 Amendment C at 2-7), Carbyne001131 (Notice of Allowability at
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`3). Similarly, the ’105 Patent asserted claims were allowed only after the addition of initiating a
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`backup of a portion of the claimed record to a second device based whether the first and second
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`devices are the “same brand.” Ex. R (’105 File History) at Carbyne001743-44 (1/28/22 Office
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`Action at 16-17) (identifying the “same brand” limitation for “reasons of allowance”),
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`Carbyne001788-91 (6/17/22 Amendment B at 2-5), Carbyne001810-1 (Notice of Allowability at
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`2-3). Neither of these two key limitations was included in the CBC Survey’s description of the
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`technology being valued.
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`Dr. Reed-Arthurs purports to have valued consumer willingness-to-pay for the
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`Authentication Patents’ patented technology, however, by testing something different from and
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`overinclusive of what is claimed: “Secure Sign-In: Passkeys,” arguing that this “encapsulate[s] the
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`patent practicing feature[].” Reed-Arthurs Report (Ex. A) ¶ 56. It is undisputed both that the
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`Authentication Patents do not claim “Passkeys” generally and that the survey instrument’s
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`description of “Passkeys” includes many uses of passkeys that would not infringe the
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`Authentication Patents. See, e.g., Jones Opening: App. D 105 Infringement (Ex. F) at 7-8 (opining
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`that infringement of the ’105 Patent requires a first device that recognizes another device of the
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`Case 1:23-cv-00324-ADA Document 235 Filed 11/06/24 Page 13 of 24
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`same brand and initiates a backup), Jones Opening: App. E 138 Infringement (Ex. G) at 6 (opining
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`that infringement of the ’138 Patent requires wiping of sensitive data).
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`One commercially available non-infringing option encompassed in her description of
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`Passkeys is an App called 1Password. Using 1Password, a user can sync2 passkeys across multiple
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`devices (e.g., a phone and web browser) without considering device brand. 1Password therefore
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`would not infringe the ’105 patent. Joint Stipulation (Ex. E) ¶ 2. 1Password is just an example
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`of multiple similar apps that do not infringe. As another example, using passkeys without a
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`“visual” prompt for providing biometric input would not infringe the ’138 patent. Jones Opening:
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`Appx. E 138 Infringement (Ex. G) at 3-5, 10-11.
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`Because the CBC Survey describes to respondents and therefore determines the
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`willingness-to-pay of a technology that is not limited to the claimed scope of the Authentication
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`Patents and includes many non-infringing alternatives, the resultant willingness-to-pay value is
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`likewise divorced from the purported invention claimed by the Authentication Patents. See Reed-
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`Arthurs Tr. (Ex. C) at 203:11-24. As a result, Mr. Blok’s reliance on and utilization of that value
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`cannot result in an apportionment for that claimed invention, rendering the survey and its results
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`confusing and unhelpful to the trier of fact.
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`Fractus is highly analogous to the facts at issue here. There, the court excluded two surveys
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`that did not test the value of the claimed invention. The surveys tested “the estimated value of
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`consumer preference for internal antennas in cell phones.” Fractus, 2011 WL 7563820, at *1. But
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`the patents-in-suit did not claim all internal antennas, but merely “one type of internal antenna that
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`purportedly provides [certain] advantages” such as multiband capabilities and reduced size. Id.
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`2 1Password sync may be a backup under Carbyne’s interpretation but it is not under Apple’s interpretation.
`Additionally, Carbyne dropped its third-party password manager allegations for both Authentication Patents. Joint
`Stipulation (Ex. E) ¶ 2.
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`Case 1:23-cv-00324-ADA Document 235 Filed 11/06/24 Page 14 of 24
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`Indeed, using internal antennas was already known in the prior art and plaintiff admitted it did not
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`invent the concept of an internal antenna. Id. Rather than testing the particular type of internal
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`antenna claimed in the patents-in-suit or consumer demand for the advantages of that claimed
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`invention, the survey attempted to broadly value customer preference of cell phones with internal
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`antennas versus external antennas. Id. Accordingly, the court concluded the surveys were “not
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`tied to the alleged advantageous technical characteristics of the patents-in-suit,” and did “not
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`measure the value of [p]laintiff’s technology,” and found that “[s]urvey evidence purportedly
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`demonstrating the value of internal antennas not tied directly to [p]laintiff’s technology confuses
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`the issues and must be excluded.” Id.
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`The defects in the CBC Survey here are even worse than those in Fractus. By surveying
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`the value of all implementations of passkeys with a face or fingerprint scan, the CBC Survey is
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`not tied to the purported invention claimed by the Authentication Patents. As in Fractus, it is well-
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`established that the tested feature—Passkeys—is not what is claimed by the Authentication
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`Patents. Jones Opening (Ex. T) ¶ 21 (explaining that the Authentication Patents “disclose systems
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`and methods using biometrics and one or more processors communicating with various storages
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`to retrieve credentials, such as cryptographic keys, to facilitate the login of users into an external
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`resource”—not “passkeys”); Jones Rebuttal (Ex. H) ¶ 28 (storage was known), ¶ 27 (biometric
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`authentication was known); Nielson Rebuttal (Ex. K) ¶¶ 101-07 ( “the asserted claims do not
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`claim passkeys”); Nielson Opening (Ex. I) ¶¶ 114-27 (cryptographic keys were known), ¶¶ 128-
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`29 (storage was known), ¶¶ 40-45 (biometric authentication was known). As Dr. Jones—
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`Carbyne’s technical expert—explains, the Authentication Patents purport to claim something far
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`more specific: a device for sign-in using a cryptographic key—here, passkeys—that also visually
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`prompts the user for providing biometric input and securely wipes credentials, or a device for
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`Case 1:23-cv-00324-ADA Document 235 Filed 11/06/24 Page 15 of 24
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`passkey sign-in that also initiates a backup to a second device based on that second device being
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`the “same brand.” Jones Rebuttal Appendix A (Ex. J) ¶¶ 8-9; Jones Opening (Ex. T) ¶¶ 20-23.
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`Indeed, Dr. Jones emphasized the importance of these wiping and backup limitations to the
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`claimed invention. See, e.g., Jones Rebuttal Appx A (Ex. J) ¶¶ 8-9 (highlighting novelty of the
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`combination of claim limitations), ¶ 11 (highlighting same brand backup and secure wiping
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`limitations). Yet none of these features is tested or even mentioned in the CBC Survey description.
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`Furthermore, like in Fractus, it is undisputed that Dr. Jakobsson, the inventor of the
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`Authentication Patents, did not invent passkeys and that such technology was already known in
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`the prior art. See, e.g., Jones Rebuttal (Ex. H) passim (not disputing cryptographic keys were
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`known in the art), ¶ 27 (biometric authentication was known), ¶ 28 (storage was known); Nielson
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`Rebuttal (Ex. K) ¶¶ 101-07 ( Dr. Jakobsson “did not invent passkeys”); Nielson Opening (Ex. I)
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`¶¶ 114-27 (cryptographic keys were known), ¶¶ 128-29 (storage was known), ¶¶ 40-45 (biometric
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`authentication was known). Nor do the Authentication Patents purport to invent “passwordless”
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`login processes, which predated the patents. Nielson Opening (Ex. I) ¶¶ 114-27, Neilson Rebuttal
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`(Ex. K) ¶¶ 83; 106, Jones Tr. (Ex. D) (153:5-154:6). The asserted claims of the Authentication
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`Patents cover only specific, discrete implementations of passkey functionality, and Carbyne has
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`not accused all implementations. The description of the “Passkey” technology set forth in the CBC
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`Survey (the valuation of which is directly relied upon by Mr. Blok), however, assumes the
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`Authentication Patents cover a far greater universe of passkey usage than what is actually claimed.
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`As such, as discussed above, “Passkeys” encompasses many stipulated non-infringing uses of
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`passkeys, including: use of third party password managers to store passkeys, which Carbyne no
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`longer accuses of infringement; use of device-bound passkeys that are not shared across a user’s
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`devices; federated authentication systems such as Single Sign On with Apple ID or Google that
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`use passkeys; and not using biometrics when logging in with a passkey because “additional two
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`factor authentication is not required” for the tested “Passkey” add on. Nielson Rebuttal (Ex. K) ¶
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`528; Joint Stipulation (Ex. E) ¶ 2. And, because the CBC Survey description of “Passkeys”
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`includes these available, acceptable, (and, in fact, currently implemented) alternatives to the
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`accused functionality of the Authentication Patents, the CBC Survey also fails to test against the
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`next-best non-infringing alternative. The CBC Survey’s description of “Sign-In Security” simply
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`fails to align with the footprint of the purported inventions, rendering the resultant willingness-to-
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`pay value wholly uninformative.
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`2.
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`The Description of the Fraud Patents Omits Key Required
`Functionality and Covers Innumerable Non-Infringing Alternatives
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`The CBC Survey likewise fails to value the claimed functionality of the Fraud Patents.
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`Instead of testing the specific peer-to-peer payment and fraud detection technology actually
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`claimed in the Asserted Claims, the CBC Survey measures consumer willingness-to-pay for a far
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`broader functionality that is entirely divorced from the claim language, includes many available,
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`acceptable, currently implemented non-infringing alternatives, and encompasses functionality
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`(like unlocking a phone, or making a purchase) that has nothing to do with what is claimed.
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`The Asserted Claims of the Fraud Patents claim a combination of user interface features
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`with a fraud detection analysis, which requires a biometric check that determines whether a user
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`is alive, and in some cases, location information, for purposes of engaging in an electronic
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`transaction. ’010 Patent, cls. 1, 6, 9; ’656 Patent, cls. 1, 8; ’886 Patent, cls. 1, 12, 14. And all of
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`the Asserted Claims require display in an interface of the virtual likeness of the face of an account
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`holder (or recipient of a transaction), and the display in the interface of a transaction icon that must
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`be interacted with to proceed with or complete the transaction. Id.; Cole Opening (Ex. N) ¶¶ 49-
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`54; Cole Rebuttal Report (Ex. L) ¶¶ 54-64. The virtual likeness is core to the alleged invention
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`Case 1:23-cv-00324-ADA Document 235 Filed 11/06/24 Page 17 of 24
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`because it is this display of a face that supposedly induces feelings of guilt in would-be fraudsters,
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`thus allegedly reducing fraud. See, e.g., ’010 at 5:16-6:58 (“Feelings of guilt for engaging in
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`fraudulent transactions can be increased both by making a given transaction more concrete and by
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`emphasizing the victim’s identity.”); ’656 Patent at 5:23-6:64 (same); ’886 Patent at 5:27-7:2
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`(same); Jakobsson Tr. (July 9, 2024) (Ex. M) at 158:21-159:10; Ex. L ¶¶ 56-69; Cole Opening
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`(Ex. N) ¶ 50. Other uses of biometric authentication, such as device log-in; website log-in (e.g.,
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`using password autofill); and payments to merchants and purchases from anyone, are not accused.
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`And, uses of other peer-to-peer payment platforms on an iPhone, such as Zelle or Venmo, are not
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`accused.
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`Dr. Reed-Arthurs claims to have valued consumer willingness-to-pay for the ’010 and ’656
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`Patents’ accused functionality by testing only an “Aliveness Check” and the willingness-to-pay
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`for the ’886 by testing only “Aliveness Check” together with “Location Check.” The parties do
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`not dispute that these features—by themselves—do not infringe the Fraud Reduction Patents nor
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`reflect the technology actually claimed by the Fraud Patents. See, e.g., Ex. L ¶¶ 57-59 (virtual
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`likeness also required to infringe); Ex. M at 229:17-230:6 (did not invent using biometric
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`information to determine whether a user is alive); Exs. U, V, W (passim). Nothing in Dr. Reed-
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`Arthurs’ description of the technology presented to the survey takers limits the technology to
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`requiring presentation of a virtual likeness, and nothing limits the biometric authentication
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`technology to use in Apple Cash for peer-to-peer payment. Because of this, the survey results
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`inherently overvalue the Aliveness Check and Location Check features. Just like with the
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`Authentication Patents, the CBC Survey describes to respondents, and therefore determines the
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`willingness-to-pay for, a technology that is different and much broader than what is claimed by
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`the Fraud Patents and includes many non-infringing alternatives. Accordingly, Mr. Blok’s reliance
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`Case 1:23-cv-00324-ADA Document 235 Filed 11/06/24 Page 18 of 24
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`on and utilization of that value cannot result in an apportionment for that claimed technology,
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`rendering the survey and its results confusing and unhelpful to the trier of fact. Because the tested
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`feature is not co-extensive with the patented feature, the survey is not reliable and must be
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`excluded. See, e.g., Fractus, 2011 WL 7563820, at *1 (excluding testimony based on survey
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`evidence that was not tied to the claimed technology).
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`Just like with the Authentication Patents, and like the excluded surveys in Fractus, because
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`of the flaws discussed above, the surveyed technology includes many non-infringing alternatives,
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`many of which are available, acceptable, and both currently implemented and widely used. For
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`example, the parties agree that to practice any of the Fraud Patent’s Asserted Claims, there must
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`be a user interface that includes both a virtual likeness of an account holder and a transaction
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`icon. Cole Opening (Ex. N) ¶¶ 121-22; Dunstone Rebuttal (Ex. P) ¶ 237. Dr. Cole, Carbyne’s
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`own technical expert, highlights the importance of these elements—in particular the virtual
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`likeness—to detecting and preventing fraud, which is the stated purpose of the Fraud Patents. Cole
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`Rebuttal (Ex. L) ¶¶ 56-59. He explains that “the Fraud Reduction Patents provide technological
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`solutions to promote the two main reasons that people refrain from committing fraud: (1) the
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`associated feelings of guilt and (2) the risk of getting caught. The Fraud Redu