Case IPR2019-01085
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`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`UNIFIED PATENTS INC.,
`Petitioner,
`
`v.
`
`DYNAMIC DATA TECHNOLOGIES, LLC,
`Patent Owner.
`
`____________
`
`Case IPR2019-01085
`Patent 8,135,073
`
`____________
`
`SUR-REPLY
`PRELIMINARY RESPONSE
`TO PETITION FOR INTER PARTES REVIEW
`
`
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`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`UNIFIED PATENTS INC.,
`Petitioner,
`
`v.
`
`DYNAMIC DATA TECHNOLOGIES, LLC,
`Patent Owner.
`
`____________
`
`Case IPR2019-01085
`Patent 8,135,073
`
`____________
`
`SUR-REPLY
`PRELIMINARY RESPONSE
`TO PETITION FOR INTER PARTES REVIEW
`
`
`
`
`
`
`
`TABLE OF CONTENTS
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`Case IPR2019-01085
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`Page
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`I.
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`II.
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`RESOLVING § 103(c) AT THE INSTITUTION STAGE IS PROPER. ....... 2
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`ALL EVIDENCE SHOWS PHILIPS HIRED MR. SHEN TO INVENT. ..... 3
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`III. ALL EVIDENCE SHOWS MR. SHEN AGREED TO ASSIGN. ................. 6
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`TABLE OF AUTHORITIES
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`Case IPR2019-01085
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`Page(s)
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`Baltimore & Ohio R.R. v. United States,
`261 U.S. 592 (1923) ............................................................................................... 4
`
`Bituminous Cas. Corp. v. Vacuum Tanks, Inc.,
`975 F.2d 1130 (5th Cir. 1992) ............................................................................... 7
`
`Teets v. Chromalloy Gas Turbine Corp.,
`83 F.3d 403 (Fed. Cir. 1996) .................................................................................. 4
`
` v. Sony Corp.,
`IPR2016-00828, Paper 10 (PTAB Oct. 7, 2016) ................................................... 3
`
`Global Tel*Link Corp. v. Securus Techs., Inc.,
`IPR2014-00824, Paper 36 (PTAB Dec. 2, 2015) .................................................. 2
`
`,
`IPR2016-01074, Paper 26 (PTAB Nov. 23, 2016) ................................................ 3
`
`Marvell Semiconductor, Inc. v. Intellectual Ventures I,
`IPR2014-00552, Paper 79 (PTAB Nov. 30, 2015) ................................................ 3
`
`U.D. Elec. Corp. v. Pulse Elecs., Inc.,
`IPR2019-00515, Paper 7 (PTAB Aug. 6, 2019) .................................................... 3
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`35 U.S.C. § 103(c) ........................................................................................ 1, 2, 3, 7
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`37 C.F.R. § 42.108(c) ................................................................................................. 1
`ii
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`Case IPR2019-01085
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`EXHIBIT LIST
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`2001
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`Philips Research, 100 years of patents and publications (June 2014),
`available at https://www.philips.com/c-
`dam/corporate/research/downloads-publications/Philips-Research-100-
`years-of-patents-and-publications-june2014.pdf
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`2002
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`Assignment History of U.S. Patent 6,873,657 (Yang)
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`2003
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`PCT Request in application PCT/IB2003/005966
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`2004
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`Declaration of Richard Chi-Te Shen
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`2005
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`Declaration of Richard Chi-Te Shen Exhibit A
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` U.S. Patent 8,135,073
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`2006
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`2007
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`2008
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`2009
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`2010
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`Declaration of Richard Chi-Te Shen Exhibit B
`Patent 8,135,073
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` Assignment for U.S.
`
`Declaration of Richard Chi-Te Shen Exhibit C
`Patent 7,570,189
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` Assignment for U.S.
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`Declaration of Richard Chi-Te Shen Exhibit D
`Patent 7,961,251
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` Assignment for U.S.
`
`Declaration of Richard Chi-Te Shen Exhibit E
`Provisional Patent Application 60/435,237
`
` File History for U.S.
`
`Declaration of Richard Chi-Te Shen Exhibit F
`(Yang)
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` U.S. Patent 6,873,657
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`2011
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`2002 Philips Employee Ethics and Intellectual Property Agreement
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`2012
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`2016 Philips Employee Ethics and Intellectual Property Agreement
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`iii
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`Case IPR2019-01085
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`2013
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`2014
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`2015
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`2016
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`Koninklijke Philips Electronics NV, SEC Filing, Form 20-F, Fiscal
`Year 2002
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`USPTO Patent Full-Text And Image Database, search results for
`AN/"Koninklijke Philips Electronics N.V" (August 28, 2019)
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`USPTO Patent Full-Text And Image Database, search results for
`AN/"Philips Electronics North America Corporation" (August 28,
`2019)
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`USPTO Patent Full-Text And Image Database, search results for
`AN/"Compagnie Francaise Philips", AN/"Philips Beteiligungs-
`GmbH", AN/"Philips Electronics China B.V", AN/"Philips Electronics
`Nederland B.V", AN/"Philips UK Limited" (August 28, 2019)
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`2017
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`Assignment History of U.S. Patent 8,135,073
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`2018
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`2019
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`FAQ, Unified Patents Website, available at:
`https://www.unifiedpatents.com/faq (last visited September 2019)
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`Defendants Corrected Initial P.R. 3-3 and 3-4 Disclosures served in
`Dynamic Data Techs., LLC, v. Samsung Elecs. Co., LTD., et al, 2:18-
`CV-00459-RWS (E.D. Tex.) July 11, 2019.
`
`2020
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`Declaration of Patrick Maloney
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`2021
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`Assignment for U.S. Patent 6,741,292
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`iv
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`Case IPR2019-01085
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`It is worth emphasizing the unlikelihood of what Unified is asking the Board
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`to believe. For Unified to prevail given the facts of record, it needs to show that
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`Philips, an enormous international corporation with a settled corporate emphasis on
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`patent protection, hired an employee just out of graduate school, paid his salary
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`and expenses to work for years on end at its facilities making inventions, and then
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`paid for and filed applications to patent those inventions, all without ensuring he
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`had any obligation to assign Philips those inventions
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`and that he then habitually
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`assigned this and other valuable, patentable inventions to that corporation anyway
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`despite lacking any obligation to do so. It is Unified
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`, as Petitioner, to
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`show there was no obligation to assign. All facts of record indicate that there was
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`such an obligation. And no evidence seriously suggests there was not.
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`The Board granted Unified leave to reply on the premise that additional
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`ly explore whether a genuine issue of
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`[§] 103(c)
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`Yang. Paper 9 (Board Order),
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`4. Unified
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`issue of material fact,
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`. It never
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`It does not dispute Patent
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`Owner
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` does not have the burden to prove Yang is
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`disqualified, and that, instead, it is Unified burden to demonstrate that [Yang] is
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`not disqualified under § 103(c) Global Tel*Link Corp. v. Securus Techs., Inc.,
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`1
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`Case IPR2019-01085
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`IPR2014-00824, Paper 36, 10-11, 23 (PTAB Dec. 2, 2015) (emphasis added)
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`(quoted in POPR, 11) Finally, the reply does not dispute Patent Owner
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`that Unified had abundant notice of Yang
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`problem. POPR, § VI.
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`All the reply offers is speculation that new facts might somehow emerge proving
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`that the invention Mr. Shen assigned to Philips was not yet under obligation of
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`assignment when it was made. Unified can show no reasonable likelihood of this.
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`Sheer speculation and bare suspicion cannot raise a genuine, material fact issue.
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`I.
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`RESOLVING § 103(c) AT THE INSTITUTION STAGE IS PROPER.
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`Unified protests that the Board cannot resolve § 103(c) against Unified now
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`because Patent Owner has not produced a written promise to assign future
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`inventions
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`-party files and Mr. Shen has not explicitly testified
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`to recalling signing one almost three decades ago. Reply, 2. This steep evidentiary
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`threshold simply does not exist. The Board has readily, in case after case, denied
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`institution based on § 103(c) in the absence of such evidence, on much sparser
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`records, and on facts significantly less favorable to patent owners. Patent Owner
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`has cited those decisions. POPR, 12. Unified has ignored them.
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`For example, past Board decisions have unhesitatingly denied institution
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`under § 103(c) when the only
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`written assignment of the invention nearly six years after the invention was made,
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`see
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`, IPR2016-00828, Paper 10, 29-30 (PTAB Oct.
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`2
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`Case IPR2019-01085
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`7, 2016) (July 17, 2000 invention, May 29, 2006 assignment (ARRIS Ex. 2003)); or
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`when the only evidence of obligation to assign was the
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`that the inventors were its employees, plus a screenshot of the USPTO
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`assignment database showing a written assignment one year after the invention
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`priority date, see U.D. Elec. Corp. v. Pulse Elecs., Inc., IPR2019-00515, Paper 7,
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`14 (PTAB Aug. 6, 2019) (citing U.D. Elec. Paper 6 (prelim resp.), 27-31 (Jan. 31,
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`2000 priority, Jan. 2001 assignment). The Board has even denied institution when
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`the evidence of obligation to assign was a defective assignment at the time and a
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`nearly sixteen years later. Johnson Safety, Inc. v.
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`, IPR2016-01074, Paper 26, 8-9 (PTAB Nov. 23, 2016), § 103(c)
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`determination clarified on rehearing, Paper 33, 3-5 (PTAB Mar. 9, 2017). 1 None
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`of these cases featured written agreements to assign future inventions. Yet all
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`nevertheless denied institution under § 103(c).
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`II.
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`ALL EVIDENCE SHOWS PHILIPS HIRED MR. SHEN TO INVENT.
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`Unified
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`
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`1 The Board has likewise found § 103(c) disqualification in the absence of
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`any written agreement to assign based on state common law. See, e.g., Marvell
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`Semiconductor, Inc. v. Intellectual Ventures I, IPR2014-00552, Paper 79 (PTAB
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`Nov. 30, 2015) (cited in POPR, 12, 36); id., 7-12, 16-21.
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`3
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`Case IPR2019-01085
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`that Mr. Shen had a binding obligation requiring him to assign his rights to Philips
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`Philips. Reply, 4-5. But Unified admits applicable
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`recognition
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`of an implied-in-fact contract that arises where an employer pays an employee to
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`invent a specific thing such that the specific invention becomes the consideration
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`, 6; see also Teets v. Chromalloy
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`Gas Turbine Corp., 83 F.3d 403, 407 (Fed. Cir. 1996)
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`[A] court must examine
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`the employment relationship at the time of the inventive work to determine if the
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`parties entered an implied-in-
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`evidence unmistakably shows that Mr. Shen and Philips had such an employment
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`relationship so that even if Shen had not agreed explicitly to assign the
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`inventions resulting from his work at Philips, an implied-in-fact obligation existed
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`entitling Philips to ownership of inventions he made.
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`-in-fact contract
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`ough not
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`embodied in an express contract, is inferred, as a fact from conduct of the parties
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`Id. (quoting Baltimore & Ohio R.R. v. United States, 261 U.S. 592, 597 (1923)).
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`Mr. Shen unambiguously testifies
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`tasked him with inventing new technologies that would reduce the processing
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`always understood that [he] had an
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`4
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`Case IPR2019-01085
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`obligation to assign the rights to inventions that [he] created within the scope of
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`[his] employment with Philips, on company time, or using company resources, to
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` Ex. 2004 ¶¶ 8, 14. His undisputed actions are exactly consistent with
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`this: he disclosed his invention to Philips, and collaborated with Philips counsel to
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`draft and submit a Philips provisional patent application. Id. ¶¶ 11, 16; Ex. 2009-2.
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`Further unambiguous evidence confirms Philips had exactly the same
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`understanding: Philips
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`with its PCT application based on the
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`provisional, stating that it
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`entitled to apply for and be granted a patent by
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`virtue of
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`entitled as employer of the inventor SHEN, Richard, Chi-Te.
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`Ex. 2003-1. Philips also bore the costs of patenting the invention, from employing
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`the attorney who submitted the provisional (Ex. 2009) to paying the costs of
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`prosecution (Ex. 2004 ¶ 11). All evidence therefore indicates Mr. Shen and Philips
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`had a meeting of the minds whereby they both understood that his employment
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`obligated him to assign these inventions to Philips.
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`Unified relies on nothing but speculation to attack that conclusion. Unified
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`specific goal of inventing new technologies that would reduce the processing
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`required for video enhancements, Ex. 2004 ¶ 9, and ignores, among other
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`evidence,
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`declaration that it could apply to patent the invention because it
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`[wa]s
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` Mr. Shen, Ex. 2003-1.
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`5
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`Case IPR2019-01085
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`predicated on an utterly implausible scenario: that Philips volunteered to pay the
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`patent prosecution costs for years on inventions Mr. Shen owned, and made a false
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`declaration to WIPO that it was entitled to patent inventions Mr. Shen owned, and
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`that Mr. Shen chose for no reason to assign his invention to Philips years later.
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`Unified points to no evidence making this scenario even remotely plausible.
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`III.
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`ALL EVIDENCE SHOWS MR. SHEN AGREED TO ASSIGN.
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`Mr. Shen unambiguously testifies he
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`and patent application
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`[he] understood that the
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`terms of [his] employment for Philips required [him] to do so
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`[he] created within the scope of [his] employment with Philips, on company time,
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`or using company resources, and
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`understood
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`that Philips owned the rights to the invention disclosed in that provisional
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` 14-15. Unified attempts to evade this inescapable
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`testimony by out-and-out mischaracterizing
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`-
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` saying Mr.
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` Reply, 1, 3. But that drastically twists
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`the testimony and facts. Mr. Shen is no longer a Philips employee, has no
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`relationship with Patent Owner
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`indeed, Patent Owner sued his current employer
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`for infringing the Patent
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`and was not compensated for his testimony. Ex. 2004
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`¶¶ 1-2. Mr. Shen simply testified when asked to do so, honestly and under oath.
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`6
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`Case IPR2019-01085
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`Moreover, as Patent Owner already explained, other public evidence already
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`amply showed that Mr. Shen agreed to assign
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`and such evidence is commonly
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`relied upon to show the existence of an agreement when the written copy is not in
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`evidence. See, e.g., Bituminous Cas. Corp. v. Vacuum Tanks, Inc., 975 F.2d 1130,
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`1132 (5th Cir. 1992)
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` the terms of the
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` For example, Patent Owner
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`presented a contemporary agreement signed by another Philips employee, and
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`near-identical language in official Philips new-hire documentation years later, Ex.
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`2001-2, 2012-5; Mr. Shen assigned other inventions he made at Philips to Philips,
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`Ex. 2007, 2008; and Philips applied to patent his invention and declared it was
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`entitled to as his employer, Ex. 2003-1. It is hardly surprising that employment
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`agreements signed by Mr. Shen, who began work at Philips 30 years ago and left
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`Philips approximately a decade ago, Ex. 2004 ¶¶ 1, 6, might not be easy for others
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`to get copies of now even if they were required for § 103(c), which they are not.
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`Unified had notice of Yang
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`burden to demonstrate with evidence
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`not speculation
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`a reasonable probability
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`that it can show that Yang is not disqualified under § 103(c). It has failed to do so.
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`Respectfully submitted,
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`____/ Kenneth J. Weatherwax /_________
`Kenneth J. Weatherwax, Reg. No. 54,528
`LOWENSTEIN & WEATHERWAX LLP
`Date: October 16, 2019
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`7
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`Case IPR2019-01085
`U.S. Pat. No. 8,135,073
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`CERTIFICATE OF SERVICE
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`The undersigned hereby certifies that the following documents were served
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`by electronic service, on the date signed below:
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`SUR-REPLY
`PRELIMINARY RESPONSE
`TO PETITION FOR INTER PARTES REVIEW
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`The names and address of the parties being served are as follows:
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`Eric A. Buresh
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`
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`Ashraf Fawzy
`Roshan Mansinghani
`Jason R. Mudd
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`Christopher Schmidt
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`eric.buresh@eriseip.com
`ptab@eriseip.com
`afawzy@unifiedpatents.com
`roshan@unifiedpatents.com
`jason.mudd@eriseip.com
`chris.schmidt@eriseip.com
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`Respectfully submitted,
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`/ Jason Linger /
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`Date: October 16, 2019
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