IPR2015-00024, Paper No. 33
`March 8, 2016
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`TIFFANY AND COMPANY,
`Petitioner,
`
`v.
`
`LAZARE KAPLAN INTERNATIONAL, INC.,
`Patent Owner.
`____________
`
`Case IPR2015-00024
`Patent 6,476,351
`____________
`
`Held: January 21, 2016
`____________
`
`trials@uspto.gov
`571-272-7822
`
`
`
`BEFORE: MICHAEL P. TIERNEY, MICHELLE R. OSINSKI,
`JEFFREY W. ABRAHAM, Administrative Patent Judges.
`
`
`
`
`
`
`
`
`The above-entitled matter came on for hearing on Thursday,
`January 21, 2016, commencing at 10:00 a.m., at the U.S. Patent
`and Trademark Office, 600 Dulany Street, Alexandria, Virginia.
`
`
`
`
`March 8, 2016
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`TIFFANY AND COMPANY,
`Petitioner,
`
`v.
`
`LAZARE KAPLAN INTERNATIONAL, INC.,
`Patent Owner.
`____________
`
`Case IPR2015-00024
`Patent 6,476,351
`____________
`
`Held: January 21, 2016
`____________
`
`trials@uspto.gov
`571-272-7822
`
`
`
`BEFORE: MICHAEL P. TIERNEY, MICHELLE R. OSINSKI,
`JEFFREY W. ABRAHAM, Administrative Patent Judges.
`
`
`
`
`
`
`
`
`The above-entitled matter came on for hearing on Thursday,
`January 21, 2016, commencing at 10:00 a.m., at the U.S. Patent
`and Trademark Office, 600 Dulany Street, Alexandria, Virginia.
`
`
`
`
`
`Case IPR2015-00024
`Patent 6,476,351
`
`
`APPEARANCES:
`
`ON BEHALF OF THE PETITIONER:
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`
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`
`
`
`
`
`
`ON BEHALF OF THE PATENT OWNER:
`
`WES MUSSELMAN, ESQ.
`RICARDO BONILLA, ESQ.
`ADAM R. SHARTZER, ESQ.
`Fish & Richardson
`1717 Main Street, Suite 500
`Dallas, Texas 75201
`
`MEHAN ARJOMAND, ESQ.
`FAHD H. PATEL, ESQ.
`Morrison & Foerster, LLP
`707 Wilshire Boulevard
`Los Angeles, California 90017-3543
`
`
`
`
`
`
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`Case IPR2015-00024
`Patent 6,476,351
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`
`P R O C E E D I N G S
`- - - - -
`JUDGE ABRAHAM: Good morning. Welcome to
`
`
`the Board. For this morning, we will hear argument in Case
`Number IPR2015-00024, Tiffany and Company versus Lazare
`Kaplan International concerning U.S. Patent Number 6,476,351.
`
`
`Before we get to the introductions, I'd just like to
`remind you that we do have Judge Osinski who is attending the
`hearing by video and audio link, so I'd ask that you speak into the
`microphone, including when you're doing initial introductions, so
`that we can be sure that she can hear everybody. So with that, I'd
`like to ask the counsels to please introduce yourselves, starting
`with Petitioner.
`
`
`MR. MUSSELMAN: Good morning, Your Honors.
`My name is Wes Musselman. I'm with Fish & Richardson,
`counsel for Petitioner, and with me are Attorneys Ricardo Bonilla
`and Adam Shartzer. And I'll be splitting my presentation this
`morning with Mr. Bonilla. We're counsel for Petitioner Tiffany
`and Company.
`
`
`JUDGE ABRAHAM: Thank you. Welcome.
`
`
`Patent Owner?
`
`
`MR. ARJOMAND: Good morning, Your Honors.
`My name is Mehran Arjomand of Morrison & Foerster. With me
`is Fahd Patel of Morrison & Foerster. We're here to represent
`Patent Owner, LKI.
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`Patent 6,476,351
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`JUDGE ABRAHAM: Welcome. Now, according to
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`the January 4th, 2016 order, each side will have 45 minutes to
`argue. Petitioner will go first and may reserve time for rebuttal.
`Patent Owner may not reserve rebuttal time. I'll remind the
`parties that Petitioner bears the burden of proving any proposition
`of unpatentability by the preponderance of evidence and also
`remind the parties that this hearing is open to the public and a full
`transcript of it will become part of the record.
`
`
`Judge Osinski has a copy of the demonstratives, but
`please remember to mention each slide number during the
`presentation so that will be recorded in the record accurately and
`also to ensure that Judge Osinski can keep track and follow your
`presentation.
`
`
`With that I'll invite Petitioner to begin.
`
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`MR. MUSSELMAN: Your Honor, I have a courtesy
`hard copy of the demonstratives if you're interested in seeing
`them.
`JUDGE ABRAHAM: Thank you.
`
`
`MR. MUSSELMAN: Good morning, Your Honors.
`
`
`As I mentioned, my name is Wes Musselman. I'm counsel for
`Petitioner Tiffany and Company in this proceeding. We'd like to
`reserve ten minutes or the rest of our allotted time for rebuttal.
`
`
`So I'll just jump right into our presentation. Turning
`to Slide 2, we've got an outline for our proposed presentation.
`We're going to begin with the motion to exclude. We'll highlight
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`Case IPR2015-00024
`Patent 6,476,351
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`a few issues there, a summary of the claims at issue. We'll
`address the claim construction issues, and then Mr. Bonilla will
`handle the remainder of our presentation, covering a review of the
`instituted grounds and the prior art and finish with addressing
`secondary considerations.
`
`
`So switching of -- Slide 3, we'll address the motion
`to exclude.
`And on Slide 4, we'd like to address four categories
`
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`of documents and information in our exclude. We feel it's
`important to do because the Patent Owner's demonstratives,
`approximately one-third of them, rely upon evidence that's been
`objected to and is the subject of the motion to exclude.
`
`
`The four general categories I've just mentioned the
`highlights of, the first one is the expert declaration, primarily the
`declaration of Dr. Bokor. Second will be the deposition transcript
`of Dr. Christensen and accompanying materials. Third is the
`declaration of Moryto the CFO of the Patent Owner, LKI. Fourth
`one are a number of documents relied upon by Mr. Moryto and
`LKI in an attempt to establish secondary considerations and
`patentability through commercial success.
`
`
`So moving to Slide 5, as shown on the screen, 37
`CFR 42.65 governs expert testimony. I'm sure you know it well.
`But it provides that expert testimony that doesn't disclose the
`underlying facts or data upon which the opinion is based is
`entitled to little or no weight.
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`Case IPR2015-00024
`Patent 6,476,351
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`The declaration of Dr. Bokor suffers from two
`
`
`deficiencies. The first is it's merely conclusory. Virtually all of
`the statements are not supported by any additional evidence or
`any evidence whatsoever that -- perhaps other than the '351
`patent. At his deposition, Dr. Bokor admitted -- and this is just an
`example on the bottom of the screen -- in his declaration that his
`conclusions lacked a basis. So the question was, You don't
`provide any basis in this paragraph for the statement that you're
`making, right? And the answer was, That is correct. It would be
`fair to say this is a conclusion. And so the declaration is replete
`with conclusory statements.
`
`
`Compounding the issue with respect to Dr. Bokor's
`declaration is many of the paragraphs are virtually identical and
`essentially having been copied from the Patent Owner response.
`This suggests lack of independent analysis or decision-making
`where the language is exactly the same as the attorney argument
`in the patent owner's response.
`
`
`The second category is the testimony of Dr.
`Christensen. And again, this goes to the secondary consideration.
`Dr. Christensen is author of a couple of the primary art articles
`that are being used in this proceeding to establish unpatentability
`of the claims. His deposition was taken many years ago in
`unrelated patent infringement litigation. Tiffany was not a party
`to that litigation. I'm not sure Tiffany knew it was going on.
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`I do know for sure they didn't know the deposition of
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`Dr. Christensen was being taken, nor were they added or able to
`participate to ask him any questions whatsoever. It would be
`unfair in this proceeding to allow LKI to use deposition testimony
`in an unrelated case to which Tiffany was not a party without
`allowing Tiffany the opportunity to cross-examine or question Dr.
`Christensen.
`
`
`If LKI wished to use Dr. Christensen's testimony in
`this proceeding, they had a simple way to do so. Two options:
`They could have submitted a declaration of Dr. Christensen and
`allowed us to depose him, or they could have sought permission
`from the Board to depose him in this case which would have
`provided us an opportunity to question him.
`
`
`So our objection -- we have two objections to that
`evidence. One, it's -- constitutes hearsay. And two, under Federal
`Rule of Evidence 403, its probative value is outweighed by the
`unfair prejudice to Tiffany. So in the motion to exclude, we've
`asked the Board not to consider that evidence.
`
`
`Turning to Slide --
`
`
`JUDGE TIERNEY: Well, why don't we -- why
`don't we stop here just for a moment.
`
`
`MR. MUSSELMAN: Yes.
`
`
`JUDGE TIERNEY: Why do we need to exclude it if
`you believe it's not credible? Why don't we just weigh its
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`Patent 6,476,351
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`credibility? Why do we have to go to the extreme step of
`excluding it as a whole?
`
`
`MR. MUSSELMAN: That's certainly an option.
`That might be an appropriate option. You could discount it. And
`according to the rule, you have the option of discounting it
`completely, or you could just discount it heavily. We think given
`the fact that it's so identical to the attorney arguments that it
`should not be considered, but alternatively, it would certainly be
`appropriate for you to give it very little consideration.
`
`
`JUDGE TIERNEY: Because going to no weight
`seems a little bit drastic under the circumstance. But I'm -- if you
`can explain why it should be given no weight whatsoever, there's
`nothing there we could actually take away from it, so I'd like to
`know because that's what you're focusing on for excluding the
`evidence.
`MR. MUSSELMAN: Yes. So the rule provides that
`
`
`you can give it no weight. I agree it would be extreme for us to
`suggest the entire declaration should be given no weight. In a
`motion to exclude, we point to particular paragraphs that are of
`special concern.
`
`
`Turning to Slide 7, this relates to Mr. Moryto's
`declaration, his reliance upon documents provided by GIA, a non-
`party to this action. I won't belabor the point here because you
`heard counsel for LKI say that they're not relying upon the
`business records exception. And with respect, you'll see in the
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`Case IPR2015-00024
`Patent 6,476,351
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`response to the motion to exclude the only category of documents
`they rely upon the residual hearsay exception is the Dr.
`Christensen testimony.
`
`
`So, therefore, if you conclude based upon our papers
`that the documents relied upon by Mr. Moryto are, in fact,
`hearsay, they should be excluded because the Patent Owner's not
`asserting any exception to the hearsay rule for them to be
`considered. And to us, that is a somewhat unusual situation and
`in which case, we would assert that those documents should be
`excluded. Basically, you have an admission by counsel for LKI
`that they're not relying upon business records exception. They
`haven't maintained any other exception.
`
`
`So beginning with Claim 8, we'll discuss the claims
`in the '351 patent which I'm sure you are familiar with. So Claim
`9, the -- we point out the '351 patent is directed to a method and
`system for using a laser to microinscribe gemstone, not just any
`way. This Gresser patent and others show ways to microinscribe
`a gemstone.
`So these claims are directed to, purportedly, a special
`
`
`way to do that. But as described in the patent, the gemstone is
`held in a mounting system. The mounting system is put on a
`translatable stage. The laser is fixed to this translatable stage and
`moves the mounting system and gem to inscribe the gemstone.
`
`
`There are 26 claims in the '351 patent. Tiffany is
`only challenging the patentability of two of them, the two
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`Case IPR2015-00024
`Patent 6,476,351
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`broadest claims in the patent, which are Independent Claims 1
`and 7.
`Turning to Slide 10. The idea of microinscribing a
`
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`diamond or a gemstone was not new. As noted in the institution
`decisions citing to the patent itself, the ideas -- the video cameras
`allow an operator to view the workpiece from a plurality of
`vantage points, provide for optical feedback of the inscription
`process, and can be used to ensure the correct positioning of the
`workpiece. So this is notable because this is coming out of the
`specification, and it's talking about operator use or intervention in
`the process.
`Turning to Slide 11, we have the '351 patent, Claim
`
`
`1. Claims 1 and 7 have very few limitations. Consequently,
`they're very broad, in fact, overly broad. They only have -- Claim
`1's a method claim. It only has five steps. You mount a
`gemstone in the mounting system. You direct the focused laser
`energy. You image the gemstone from at least one vantage point.
`You receive marking instructions as at least one input. All of
`that's been known before. LKI does not assert that that wasn't all
`known before. They focus on the last step, controlling the
`directing of the focused laser energy, that's where we'll
`concentrate our discussion, as well.
`
`
`Turning to Slide 12, Claim 7 is a system claim
`counterpart to Claim 1. The claim terms are very similar except
`in the system claim, it's couched in terms of sources, means, and
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`Case IPR2015-00024
`Patent 6,476,351
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`other terms appropriate for a systems claim. As set forth in our
`briefing, the means for directing limitation that is about halfway
`down the page is properly construed as a translatable stage, and
`LKI hasn't contested that construction.
`
`
`In fact, LKI has, again, with respect to Claim 7 not
`contested that the prior art teaches everything up to the last claim
`or last claim term, a processor for controlling said directing
`means. In the context of Claim 7, the Board may want to consider
`-- with Claim 7 being a system claim whether everything in the
`last term beginning with four controlling said directing means, is
`limiting, or it's merely the intended purpose of the system.
`
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`Turning to Slide 13 --
`
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`JUDGE ABRAHAM: One second. Was that
`something you raised in your briefs?
`
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`MR. MUSSELMAN: No, I don't believe so.
`
`
`Turning to 13, we'll address claim construction.
`Claim -- beginning with Slide 14, the controlling limitation.
`Now, LKI's argument is focused solely on this construction of the
`controlling limitation. The Federal Circuit has already construed
`this limitation, applying the Phillips standard. But LKI is here
`today asking to you rewrite this claim. Petitioner and the Board
`in the institution decision correctly observed that the specification
`discloses both automatic and user-controlled feedback of the
`stone's images to direct the laser either -- both before and during
`the inscription.
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`Case IPR2015-00024
`Patent 6,476,351
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`You see at the bottom of Slide 14 the Federal
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`Circuit's construction where they say, These statements make
`evident one of ordinary skill in the art at the time of the invention
`would have understood the term controlling the directing based
`on the imaging to include control based on either automated or
`manual feedback derived from optical imaging of a gemstone
`transact before or during the laser burn process. Slide 14 shows
`the citation to the Federal Circuit decision that construes the term.
`
`
`The Board's construction in the institution decision
`was correct. Following with the Federal Circuit applying the
`Phillips standard, they adopted the exact same construction as
`would be appropriate in this case.
`
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`And turning to Slide 16, LKI challenges the Board's
`construction and thus the Federal Circuit's construction on -- in
`the first instance, they say that the wrong construction standard
`has been used here because this patent is going to expire. That's
`really just a red herring or irrelevant argument because the
`construction adopted by the Board, which is the same as the
`Federal Circuit, was based upon the Federal Circuit's application
`of Phillips. And so we assert that this term whether it -- the
`controlling term whether you apply the broadest reasonable
`interpretation standard or the Phillips standard results in the same
`construction which is the one the Board reached.
`
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`Turning to Slide 17. Now, this is not a typical case.
`It's not two parties battling over the meaning or construction of a
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`Case IPR2015-00024
`Patent 6,476,351
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`claim term. It's not a patent owner who is objecting to
`construction that's been provided by a magistrate judge or a
`district judge. That is a case of the patent owner who does not
`like a construction provided by the Federal Circuit, and they're
`here asking you to rewrite the claims.
`
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`And here's what they want you to do. They want
`you to add the word electronic in the claims before image
`information. They want you to add the word combined in the
`claims before to selectively generate. And a third term that they
`want you to add, they didn't state it as clearly. But at page 20 of
`the response is they want it to happen, the combination to happen
`automatically by a computer without user input. That's at page 20
`of their response. And so they would put automatically combined
`in the claim.
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`Now, if they wanted to put that in the claim, here's
`how simple it would have been. But the fact is the claims don't
`include any of those three terms, and there's nothing to support
`changing your decision as to the -- as to the construction or the
`Federal Circuit's decision.
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`To be clear, if the Board elects not to rewrite these
`claims, LKI has no arguments. All of their arguments are based
`upon their proposed rewrite to the claim with the exception of
`secondary considerations. So to even get to their arguments
`about how their prior art applies, you have to decide to rewrite
`these claims.
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`I'll turn the lectern over to my colleague, Mr.
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`Case IPR2015-00024
`Patent 6,476,351
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`What's happening today is LKI is seeking a second
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`bite of the apple. This has been decided by the Federal Circuit on
`an appeal from a District Court case that we've not been a party
`to. The second bite comes in. They are asking the Board to
`rewrite this claim to add three terms to allow them to go back up
`to the Federal Circuit and explain to them why the Federal Circuit
`got it wrong in the first instance, and the Board should not do
`that.
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`
`Bonilla.
`JUDGE ABRAHAM: One question. The Patent
`
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`Owner's arguments regarding the combination of prior art
`reference, does that apply regardless of the claim construction as
`adopted?
`MR. MUSSELMAN: As to whether the references
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`could be combined?
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`JUDGE ABRAHAM: Right.
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`MR. MUSSELMAN: Yes, I do think. I think --
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`JUDGE ABRAHAM: They could --
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`MR. MUSSELMAN: -- they could apply.
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`JUDGE ABRAHAM: Okay.
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`MR. MUSSELMAN: I think you're correct.
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`JUDGE ABRAHAM: Okay. Thank you.
`
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`MR. MUSSELMAN: Thank you.
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`JUDGE TIERNEY: Just a moment before you
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`Case IPR2015-00024
`Patent 6,476,351
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`begin.
`MR. BONILLA: Your Honors, Ricardo Bonilla for
`
`
`Petitioner. And as my co-counsel mentioned, I'll address the
`remaining -- the remainder of our presentation beginning with
`here on Slide 18, the prior art references that comprise the
`grounds -- comprise the grounds upon which the institution
`decision decided to go forward with this proceeding.
`
`
`There are three such references, the first being the
`Fine Diamonds article; second, the ILR article; and third, the
`Gresser patent. Turning to Slide 19, the Fine Diamonds article
`was published in November of 1993 by Dr. Christensen. That's
`one of the reasons why my co-counsel's presentation is so
`important as far as the motion to exclude.
`
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`Dr. Christensen is the author of two of the references
`upon which the grounds were instituted, Fine Diamonds being
`one of them, and it qualifies as prior art under Section 102(b).
`LKI does not dispute that any of these three pieces of prior art,
`Fine Diamonds, the ILR article, or the Gresser patent are
`appropriately prior art under Section 102(b).
`
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`Turning to Slide 19, Fine Diamonds discloses a laser
`-- a laser machining system, and it -- the system is -- includes a
`computer and then control board; translatable stages upon which
`you could rest a gemstone on a workpiece; and then a laser beam
`that's focused onto that gemstone so that you can move the
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`Case IPR2015-00024
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`gemstone or the workpiece using the translatable stages while the
`laser beam remains in the same position.
`
`
`And you can see that from -- at Slide 19, if you look
`at the figure at the top of the bottom left corner, the boxes, the
`computer and stage controller at the top right-hand corner, the
`video camera and viewing optics that will allow an operator to
`view the workpiece. And then on the bottom right-hand corner,
`the XYZ stages that -- those are the translatable stages that would
`hold, essentially be the mounting system for the workpiece.
`
`
`The next article over here on Slide 21 is the ILR
`article. It was also published by Dr. Christensen in 1994, and you
`can see from -- it's hard to see from the slides here on the screen.
`But the figure in the ILR article in the bottom right-hand corner is
`nearly identical to the figure from the Fine Diamonds article, and
`that's not surprising given it's from the same author discussing the
`same subject matter in the same manner for the same purpose.
`
`
`So if we go to Slide 22, you can see that the ILR
`article is showing that same layout of this UV laser workstation.
`You've got a computer; translatable stages upon which you can
`mount a stone or a workpiece; and then the video camera and
`optics that can view the stone or workpiece and the laser that's
`focused on them. So the two of them have similar systems. Their
`disclosures are -- they differ only in the written description of the
`disclosures, not in these two figures.
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`Now, one of the arguments that LKI makes is that
`
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`these articles don't actually disclose gemstones, microinscribing
`gemstones. They're limited to just polymerized sheets or cutting
`materials of the sheets of diamonds. That's incorrect because if
`you look at Fine Diamonds, page 2 of that reference discusses
`microinscribing the likenesses of Aunt Martha's grandchildren on
`the face of her wedding ring.
`
`
`So there is a disclosure of using these processes
`disclosed in these prior art references, to use these -- to use
`processes, to actually inscribe the symbol or indicia onto the
`gemstone. And, in fact, LKI's expert, Dr. Bokor, was asked at
`page 55 of his deposition whether the reference to Aunt Martha's
`wedding ring is a reference to gemstones, if that's how a person of
`ordinary skill in the art would understand that reference. And he
`admitted that that is what a person of ordinary skill in the art
`would understand. So there is no serious dispute that Fine
`Diamonds and ILR do discuss, not just cutting into sheets of
`diamond material, but also microinscribing onto gemstones.
`
`
`The third reference is the Gresser patent, and that's
`shown here on Slide 23. The Gresser patent issued on July 12,
`1983, and it has some similarities with the '351 patent because
`they share the same -- one of the same inventors, George Kaplan
`who's highlighted here on the slide. And the original assignee of
`the Gresser patent was Lazare Kaplan & Sons, which was a
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`Case IPR2015-00024
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`predecessor to the LKI entity that's the Patent Owner in today's
`proceeding.
`If we go to Slide 24, here you can see the figure,
`
`
`one, Figure 1 from Gresser, and it discloses a similar system.
`We've got, again, a computer that's represented by the box in the
`bottom, in the bottom portion of Figure 1. And the top right
`portion are the translatable stages upon which a gemstone can be
`mounted and then moved under focused laser beam.
`
`
`So turning to the instituted grounds, we go here to
`Slide 26. Tiffany's filed this petition asking the Board to institute
`on six grounds. The Board instituted on three of them, those
`being that the patent claims are invalid, are -- invalid as obvious
`under -- Fine Diamonds, the second ground was Fine Diamonds
`and the ILR article; and the third, the Gresser patent combined
`with the ILR article.
`
`
`Now, when going through the claims, if we look
`here on Slide 27, for -- given the amount of time we have in the
`hearing today, we're going to focus on Claim 1, but the
`limitations are nearly identical between the two. The difference
`between Claim 1 and Claim 7 is that Claim 1 is a method, and
`Claim 7 is a system claim. So when we look at the claims, Claim
`1 has a method of microinscribing a gemstone with laser energy.
`Claim 7 is laser energy microinscribing system for gemstones.
`
`
`Similarly, Claim 1 is the first step is a mounting
`gemstone in a mounting system. In Claim 7, the first component
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`is a gemstone mounting system, and so on. So the limitations in
`Claim 1 are found in Claim 7 really drafted as system, a system
`claim, rather than a method claim. So we'll focus on Claim 1 in
`our discussion, our presentation here today, but rest on our papers
`with specific arguments regarding Claim 7.
`
`
`Turning to Claim 1, obviousness in view of Fine
`Diamonds, we go to Slide 29. There are several limitations in
`these claims. The only limitation that's seriously in dispute, that's
`actually at issue here, is the controlling limitation which is the
`last limitation of Claim 1 and Claim 7. You heard on the
`conference call yesterday that LKI is not challenging any other
`limitation, any other limitation for any of the references. So as
`you can see here on Slide 29, it's undisputed, for example, that
`Fine Diamonds discloses the first limitation of the preamble in
`that, that of microinscribing a gemstone with laser energy.
`
`
`And under 35 CFR 4223(a), any material fact that's
`not specifically denied may be considered admitted. And here,
`these facts have not been denied. LKI is not challenging that
`these prior art references disclose every limitation except the
`controlling limitation with the one exception when it comes to the
`Gresser patent, and I'll address that in a moment. So they can be
`considered to have been admitted.
`
`
`I won't go through each one of these limitations, but
`as an example, this first example on Slide 29, Fine Diamonds, if
`you look at the actual reference itself, discloses the use of small
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`Case IPR2015-00024
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`ultraviolet lasers to shape diamond surfaces with very high
`precision and spatial resolution. That's clearly a disclosure of a
`method of microinscribing a gemstone. And the only reference to
`this particular limitation in the Patent Owner's response is at -- it's
`page 33 where it states that Fine Diamonds discloses lasers for
`ablating the surface of the diamond substrate. So there is no
`serious dispute as to this limitation, and the same is true for
`several more limitations.
`
`
`Here on Slide 30, the limitation of mounting a
`gemstone in a mounting system is not in dispute.
`
`
`On Slide, 31, the limitation of directing the focused
`laser energy onto a desired portion of the gemstone is not in
`dispute.
`On Slide 32, imaging the gemstone from at least one
`
`
`vantage point is not in dispute.
`
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`And finally, on Slide 33, receiving marking
`instructions as at least one input is also not in dispute.
`
`
`Now, on Slide 34, we come to the limitation that's in
`dispute here. As co-counsel mentioned, the issue is how is this
`term going to be construed? But when looking at the limitation in
`the plain language of the limitation and how the Board has
`construed this limitation, how the Federal Circuit has construed
`this limitation, Fine Diamonds discloses this limitation.
`
`
`If we look at Fine Diamonds at pages 106, 108, and
`110 of the reference, it discloses the use of small ultraviolet lasers
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`Case IPR2015-00024
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`to shape diamond surfaces, and then the use of optical tools that
`combine these laser sources with high-resolution imaging and
`precision motion-control systems to effect certain operations with
`the lasers such as marking, planarizing, sculpting.
`
`
`So that is the discussion of using this information
`that's derived from the system, the imaging that's derived from
`the system, and certain instructions that can be inputted to the
`system to control the laser and how it microinscribes and how it
`carves or images onto the gemstone.
`
`
`And Tiffany's also offered the declaration of Dr.
`Trumper here on Slide 34 -- you can see it's Paragraphs 38
`through 45 -- who stated that this disclosure, a person of ordinary
`skill in the art reading this disclosure would understand it to
`disclose the limitation of controlling the directing of the focused
`laser beam because it's using the combination of the marking
`instructions provided by the CAD/CAM software and then the
`high-resolution imaging that comes from the video camera in
`order to mark the gemstone based on those instructions.
`
`
`Now, on Slide 35, we see LKI's arguments. Again,
`LKI is not disputing that Fine Diamonds discloses any limitation
`except the control. So if LKI argues first that Fine Diamonds
`does not show a combination of the electronic images and
`marking instructions, as my co-counsel mentioned, those words
`are not in the claim language, and they're not in the constructions
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`Case IPR2015-00024
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`of the Federal Circuit that this Board adopted in its institution
`decision.
`So if this Board does not agree to change the
`
`
`construction and ignore, essentially, the Federal Circuit's
`instruction, then this argument has no weight because there is no
`need for Fine Diamonds to disclose a combination of electronic
`images and marking instruction if that's not what the claim term is
`limited to. Second, LKI argues that Fine Diamonds does not show
`video images fed back to the computer and stage controller. And
`Fine Diamonds -- LKI makes this argument for both Fine
`Diamonds and the ILR article.
`
`
`So we'll take a look at here at Slide 38. This is the
`figure that's in the ILR article. It's also in the Fine Diamonds
`article. They're virtually identical. LKI's argument is that
`because there is no line from the video camera and viewing optics
`box on the top right-hand corner of the figure to the computer and
`stage controller box in the bottom left-hand corner, then video
`images are not being fed back from the video camera to the
`computer and stage controller. This is a gross oversimplification
`of the figure and the articles themselves.
`
`
`If the articles were limited to just the figures, that
`might be a plausible argument, but they're not limited to just the
`figures. There's text in these articles, and the text describes how
`these systems work. So for example, if we look here on Slide 39,
`this is an example from the ILR article at page 2. And in that
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`Case IPR2015-00024
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