Trials@uspto.gov
`571-272-7822
`
`Paper 13
`Date: August 18, 2020
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`VMWARE, INC.,
`Petitioner,
`v.
`INTELLECTUAL VENTURES I LLC,
`Patent Owner.
`
`IPR2020-00470
`Patent 7,949,752 B2
`
`
`
`
`
`
`
`
`
`Before THOMAS L. GIANNETTI, JENNIFER MEYER CHAGNON, and
`JOHN R. KENNY, Administrative Patent Judges.
`CHAGNON, Administrative Patent Judge.
`
`DECISION
`Granting Institution of Inter Partes Review
`35 U.S.C. § 314, 37 C.F.R. § 42.4
`
`
`
`
`
`
`
`
`571-272-7822
`
`Paper 13
`Date: August 18, 2020
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`VMWARE, INC.,
`Petitioner,
`v.
`INTELLECTUAL VENTURES I LLC,
`Patent Owner.
`
`IPR2020-00470
`Patent 7,949,752 B2
`
`
`
`
`
`
`
`
`
`Before THOMAS L. GIANNETTI, JENNIFER MEYER CHAGNON, and
`JOHN R. KENNY, Administrative Patent Judges.
`CHAGNON, Administrative Patent Judge.
`
`DECISION
`Granting Institution of Inter Partes Review
`35 U.S.C. § 314, 37 C.F.R. § 42.4
`
`
`
`
`
`
`
`
`
`IPR2020-00470
`Patent 7,949,752 B2
`INTRODUCTION
`I.
`
`VMware, Inc. (“Petitioner”)1 filed a Petition requesting inter partes
`review of claims 1–4, 6, 9–11, 13, 14, and 22–26 (“the challenged claims”)
`of U.S. Patent No. 7,949,752 B2 (Ex. 1001, “the ’752 patent”). Paper 1
`(“Pet.”). Intellectual Ventures I LLC (“Patent Owner”) filed a Preliminary
`Response. Paper 7 (“Prelim. Resp.”). Additionally, we granted Petitioner’s
`request to file a reply to the Preliminary Response in order to address the
`factors laid out in our recent precedential Order in Apple, Inc. v. Fintiv, Inc.,
`IPR2020-00019, Paper 11 (PTAB Mar. 20, 2020) (precedential) (“Fintiv
`Order”) regarding the exercise of our discretion under 35 U.S.C. § 314(a).
`Paper 8. Petitioner filed a Reply (Paper 9) and Patent Owner, in turn, filed a
`Sur-reply (Paper 10).
`We have authority to determine whether to institute an inter partes
`review under 35 U.S.C. § 314, which provides that an inter partes review
`may be instituted only upon a showing that “there is a reasonable likelihood
`that the petitioner would prevail with respect to at least 1 of the claims
`challenged in the petition.” 35 U.S.C. § 314(a). After considering the
`Petition, the Preliminary Response, and the evidence of record, we
`determine that Petitioner has demonstrated a reasonable likelihood of
`prevailing with respect to at least one claim challenged in the Petition.
`Further, we decline to exercise discretion to deny institution under 35 U.S.C.
`§ 314(a). Accordingly, we institute an inter partes review of all challenged
`claims of the ’752 patent, based on all grounds identified in the Petition.
`
`
`1 Petitioner states that VMware, Inc. is the real-party in interest in this
`proceeding. Pet. 1, 62. Petitioner also states that “VMware, Inc. is a
`majority-owned subsidiary of EMC Corporation which is a wholly-owned
`subsidiary of Dell Technologies Inc.” Id.
`
`2
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`Patent 7,949,752 B2
`The following findings of fact and conclusions of law are not final,
`but are made for the sole purpose of determining whether Petitioner meets
`the threshold for initiating review. Any final decision shall be based on the
`full trial record, including any response timely filed by Patent Owner. Any
`arguments not raised by Patent Owner in a timely-filed response may be
`deemed waived, even if they were presented in the Preliminary Response.
`
`A.
`
`Related Proceedings
`
`The parties identify Intellectual Ventures I, LLC v. VMware, Inc.,
`Case No. 1-19-cv-01075 (W.D. Tex.) (the “parallel proceeding”) as a related
`matter involving the ’752 patent. Pet. 62; Paper 4, 1.
`The parties also identify Intellectual Ventures I, LLC v. HCC
`Insurance Holdings, Inc., Case No. 6-15-cv-00660 (E.D. Tex.) as a
`dismissed matter involving the ’752 patent. Pet. 62; Paper 4, 1.
`Additionally, the parties identify IPR2016-01431 as a dismissed inter partes
`review proceeding involving the ’752 patent. Pet. 62; Paper 4, 1.
`
`B.
`
`The ’752 Patent
`
`The ’752 patent, titled “Network System Extensible by Users,” was
`filed November 24, 2004,2 and issued on May 24, 2011. Ex. 1001, codes
`(22), (45), (54). The ’752 patent describes a “network system” that “users
`may extend or customize” through an agent system. Id. at 2:52–55. A
`
`
`2 The ’752 claims priority as a continuation of application No. 09/712,712,
`filed on Nov. 14, 2000, which is a continuation of application No.
`09/178,366, filed on Oct. 23, 1998. Ex. 1001, code (63). The specific
`priority date of the challenged claims is not at issue in this proceeding, and
`we need not make any determination in this regard for purposes of this
`Decision.
`
`3
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`Patent 7,949,752 B2
`network system provides, e.g., information technology services “such as
`electronic mail (e-mail), voice mail, electronic organizer (for appointments
`and/or addresses), online data retrieval (for, e.g., periodicals and stock
`quotes), and the like.” Id. at 5:32–37, 43–45. The network system is
`extended or customized for a user such that “[e]ach service individually, or
`the network system as a whole, can be extended by adding agents.” Id. at
`2:54–59.
`Figure 1, reproduced below, illustrates a network system that is
`customizable or extensible for users via agents. Id. at 3:51–52.
`
`
`As shown in network system 2 of Figure 1, above, “agent server 20 controls,
`coordinates, and otherwise manages the overall operation of programmable
`functionality component 4” and, further, “may invoke, initiate, or execute
`various routines, processes, objects, and the like.” Id. at 7:51–55. “For
`example, when a user wishes to interact with network system 2 via graphical
`user interface 12, agent server 20 may cause web pages to be downloaded to
`
`4
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`IPR2020-00470
`Patent 7,949,752 B2
`an electronic user device.” Id. at 7:55–58. Agent server 20 also “execut[es]
`agent objects,” i.e., agents. Id. at 7:62–63; see also id. at 15:33–37 (“Agent
`objects 46 each correspond to a particular agent 22 of network system 2
`(FIG. 1). Each agent object 46 can be an internal representation within agent
`server 20 for the corresponding agent 22. Agent objects 46 comprise
`software objects.”).
`Further, “each agent 22 is responsible for performing a particular task
`or set of tasks on behalf of the respective principal,” e.g., “answering
`telephone calls, taking voice mail messages, placing telephone calls,
`notifying the user of recently received messages (voice mail and/or e-mail),
`delivering messages, setting up meetings/appointments, gathering
`information, negotiating deals, transacting electronic commerce, etc.” Id. at
`8:56–64. During execution of the agent, the agent “begins to receive events
`[and can] handle these events.” Id. at 10:9–11. The agent includes event
`handlers component 58; an event handler includes “a routine for handling an
`event of a specified type,” e.g., “events can be the lapse of a previously
`specified amount of time or the delivery of an e-mail message.” Id. at
`18:22–28. An event can be “identified by a uniform resource locator (URL)
`which . . . specifies both the event’s type and the agent 22 which is [the]
`event’s intended recipient.” Id. at 18:29–32.
`In an “exemplary operation for agent server 20,” an agent “is
`responsible for waking up its principal at a certain time each weekday
`morning,” the wake up time constituting an event. Id. at 16:9–14. Upon the
`event’s occurrence, agent server 20 includes an “engine 42 [which] executes
`the particular agent object 46.” Id. at 16:13–15; see id. at 15:14–19. “When
`this agent object 46 is executed, the corresponding agent 22 (using the
`
`5
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`Patent 7,949,752 B2
`appropriate services 24) performs the task of waking up the principal.” Id. at
`16:15–18.
`Although the agent object resides on, and is executed by, the agent
`server in the above-described embodiment (see id. at 16:9–20, 22:52–23:57),
`the ’752 patent also discloses that, in another embodiment, “each agent 22
`may direct its own movement (i.e., transportation) through a computer-based
`system . . . by executing an instruction which identifies a destination
`computer within the computer-based system and directs that the particular
`agent 22 be transported there.” Id. at 9:60–64. The agent may then further
`“determine another destination computer to which the agent should travel.”
`Id. at 9:67–10:2; see also id. at 14:10–16 (“[A]gents 22 may travel
`throughout the environment of computer-based system 30. . . . As an agent
`22 moves and executes, it may perform its respective tasks on behalf of the
`principal.”).
`Additionally, in order to perform their “respective tasks, agents 22
`may use or consume various computational resources 21 (e.g., memory
`storage space, processing time, and the like)” and “various service
`resources” (i.e., “a resource which enables a service to be performed” (e.g.,
`a “modem for on-line communication” or an “on-line database provider
`service”)). Id. at 9:31–36, 10:62–11:5. Computational resources “may be
`‘consumed’ or ‘used up’” by agents “during the operation of network
`system 2.” Id. at 8:21–23. Likewise, at least some service resources “may
`comprise discrete units which are ‘consumed’ during utilization of the
`respective resource by an agent 22,” such as, e.g., “units of data-access time
`or inquiry which are consumed as an agent retrieves data.” Id. at 11:6–16.
`The “consumption of computational and service resources by various
`agents 22 can be monitored, and the respective principals charged for the
`
`6
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`IPR2020-00470
`Patent 7,949,752 B2
`same.” Id. at 9:36–39. Monitoring may further “ensure that other agents 22
`(acting on behalf of the same or other principals/users) have adequate
`computational and service resources.” Id. at 9:46–51; see also id. at 12:25–
`32 (Service wrapper 26 “may also monitor the amount of each respective
`service resource 25 consumed to ensure that no particular agent 22 uses
`more than an amount authorized for that agent when performing its specific
`task(s). This protects both the authorizing user/subscriber and the service
`provider against undue consumption of service resources 25.”).
`In order to allocate resources, “[i]n one embodiment, each agent 22 is
`given permission to consume up to a pre-authorized amount of each
`computational resource and each service resource that the agent may use
`when performing its respective task(s).” Id. at 9:40–43. In another
`embodiment “a predetermined amount of resource” is authorized “for the
`principal” such that “the associated agents 22 are given a ‘pool’ of that
`resource from which to draw.” Id. at 9:52–59.
`
`C.
`
`Illustrative Claim
`
`Of the challenged claims, claims 1, 9, and 24 are independent.
`Claims 2–4 and 6 depend from claim 1; claims 10, 11, 13, 14, and 23 depend
`from claim 9; and claims 25 and 26 depend from claim 24. Independent
`claim 1 of the ’752 patent is reproduced below, and is illustrative of the
`challenged claims.
`1. A system for performing user customized network-based
`operations, comprising:
`means for receiving data for creating a network-based
`agent;
`
`7
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`IPR2020-00470
`Patent 7,949,752 B2
`means for invoking, in response to receiving a URL
`defining a type of event and identifying the network-based agent,
`an execution of the network-based agent;
`means, including the network-based agent, for using a
`service and a service resource configured to be consumed by the
`network-based agent for performing the operation, wherein an
`amount of the service resource is exhausted upon being
`consumed by the network-based agent; and
`means for communicating a result of the operation over a
`network communications link.
`Ex. 1001, 25:55–26:2.
`
`D.
`
`The Applied References
`
`Petitioner relies on the following references in the asserted grounds.
`Pet. 22–23.
`
`Reference
`
`U.S. Patent No. 6,029,175 (“Chow”)
`
`Issue Date/
`Publication Date Exhibit
`Feb. 22, 20003
`Ex. 1018
`
`U.S. Patent No. 5,367,635 (“Bauer”)
`
`Nov. 22, 19944
`
`Ex. 1019
`
`U.S. Patent No. 5,603,031 (“White”)
`
`Feb. 11, 19975
`
`Ex. 1020
`
`Petitioner also relies on the Declaration of Farrell Long, Ph. D.
`(Ex. 1005) to support its positions.
`
`
`3 Chow was filed on June 7, 1996, and is prior art to the challenged claims at
`least under 35 U.S.C. § 102(a), (b), (e). See Ex. 1018, code (22); Pet. 22.
`4 Bauer was filed on August 29, 1991, and is prior art to the challenged
`claims at least under 35 U.S.C. §§ 102(a), (b), (e). See Ex. 1019, code (22);
`Pet. 22.
`5 White was filed on July 8, 1993, and is prior art to the challenged claims at
`least under 35 U.S.C. §§ 102(a), (e). See Ex. 1020, code (22); Pet. 23.
`
`8
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`IPR2020-00470
`Patent 7,949,752 B2
`The Asserted Grounds
`E.
`
`Petitioner sets forth its challenges to claims 1–4, 6, 9–11, 13, 14, and
`22–26 on the following grounds. Pet. 21–22.
`
`35 U.S.C. §
`1036
`
`Claims Challenged
`1–4, 9, 13, 14, 22, 24–26
`
`103
`
`103
`
`103
`
`6, 10, 11, 23
`
`1–4, 9, 13, 14, 22, 24–26
`
`6, 10, 11, 23
`
`Reference(s)
`Chow
`
`Chow and Bauer
`
`Chow and White
`
`Chow, White, and Bauer
`
`
`II. ANALYSIS
`
`A.
`
`Legal Standards
`
`“In an [inter partes review], the petitioner has the burden from the
`onset to show with particularity why the patent it challenges is
`unpatentable.” Harmonic Inc. v. Avid Tech., Inc., 815 F.3d 1356, 1363 (Fed.
`Cir. 2016) (citing 35 U.S.C. § 312(a)(3) (requiring inter partes review
`petitions to identify “with particularity . . . the evidence that supports the
`grounds for the challenge to each claim”)). This burden of persuasion never
`shifts to Patent Owner. See Dynamic Drinkware, LLC v. Nat’l Graphics,
`Inc., 800 F.3d 1375, 1378 (Fed. Cir. 2015) (discussing the burden of proof in
`inter partes review).
`
`
`6 Because the application leading to the ’752 patent was filed before
`March 16, 2013, patentability is governed by the version of 35 U.S.C.
`§§ 102 and 103 preceding the Leahy-Smith America Invents Act (“AIA”),
`Pub L. No. 112-29, 125 Stat. 284 (2011).
`
`9
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`IPR2020-00470
`Patent 7,949,752 B2
`A claim is unpatentable under 35 U.S.C. § 103(a) if “the differences
`between the subject matter sought to be patented and the prior art are such
`that the subject matter as a whole would have been obvious at the time the
`invention was made to a person having ordinary skill in the art to which said
`subject matter pertains.” KSR Int’l Co. v. Teleflex Inc., 550 U.S. 398, 406
`(2007). The question of obviousness is resolved on the basis of underlying
`factual determinations including: (1) the scope and content of the prior art;
`(2) any differences between the claimed subject matter and the prior art;
`(3) the level of ordinary skill in the art; and (4) objective evidence of
`nonobviousness.7 Graham v. John Deere Co., 383 U.S. 1, 17–18 (1966).
`An obviousness analysis “need not seek out precise teachings directed to the
`specific subject matter of the challenged claim, for a court can take account
`of the inferences and creative steps that a person of ordinary skill in the art
`would employ.” KSR, 550 U.S. at 418; accord In re Translogic Tech., Inc.,
`504 F.3d 1249, 1259 (Fed. Cir. 2007). However, Petitioner cannot satisfy its
`burden of proving obviousness by employing “mere conclusory statements.”
`In re Magnum Oil Tools Int’l, Ltd., 829 F.3d 1364, 1380 (Fed. Cir. 2016).
`Instead, Petitioner must articulate a reason why a person of ordinary skill in
`the art would have combined the prior art references. In re NuVasive,
`842 F.3d 1376, 1382 (Fed. Cir. 2016).
`We analyze the asserted grounds of unpatentability in accordance with
`these principles to determine whether Petitioner has met its burden to
`establish a reasonable likelihood of success at trial.
`
`
`7 At this stage of the proceeding, the parties have not asserted or otherwise
`directed our attention to any objective evidence of non-obviousness.
`
`10
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`IPR2020-00470
`Patent 7,949,752 B2
`Level of Ordinary Skill in the Art
`B.
`
`Petitioner contends that a person having ordinary skill in the art would
`have had “a bachelor’s degree in computer science or electrical engineering
`and at least two years of experience in computer software systems.” Pet. 12
`(citing Ex. 1005 ¶ 21).
`At this stage of the proceeding, Patent Owner does not contest
`Petitioner’s definition of a person of ordinary skill in the art. See generally
`Prelim. Resp.
`Based on the current record and for the purposes of this Decision, we
`adopt Petitioner’s proposed description of the person of ordinary skill in the
`art.
`
`C.
`
`Claim Construction
`
`For this inter partes review proceeding claim terms
`shall be construed using the same claim construction standard
`that would be used to construe the claim in a civil action under
`35 U.S.C. [§] 282(b),
`including construing
`the claim
`in
`accordance with the ordinary and customary meaning of such
`claim as understood by one of ordinary skill in the art and the
`prosecution history pertaining to the patent.
`37 C.F.R. § 42.100(b) (2019). Further, “[a]ny prior claim construction
`determination concerning a term of the claim in a civil action, or a
`proceeding before the International Trade Commission, that is timely made
`of record in the inter partes review proceeding will be considered.”8 Id.
`
`8 A claim construction order was recently entered in the parallel district
`court proceeding (Ex. 3001), which we have considered. We also have
`considered a claim construction order entered by the magistrate judge in the
`dismissed Eastern District of Texas litigation identified above (see
`Section I.A).
`
`11
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`IPR2020-00470
`Patent 7,949,752 B2
`Under the standard set forth in Phillips v. AWH Corp., 415 F.3d 1303,
`1312–19 (Fed. Cir. 2005) (en banc), claim terms are given their ordinary and
`customary meaning, as would have been understood by a person of ordinary
`skill in the art at the time of the invention, in light of the language of the
`claims, the specification, and the prosecution history of record. See Thorner
`v. Sony Comput. Entm’t Am. LLC, 669 F.3d 1362, 1365–66 (Fed. Cir. 2012).
`Petitioner discusses the construction of several claim terms —
`including the “means” limitations, “service”/“service resource,” “agent,”
`“URL defining a type of event and identifying the network-based agent,”
`“consumed,” “exhausted,” “event handler,” and “service wrapper” — but
`proposes that construction of most of these terms is not necessary for
`purposes of this Decision. See Pet. 12–21; id. at 13 (“VMware will address
`all terms that have been subject to a prior construction dispute. But VMware
`does not believe that the Board will need to reach a construction for all
`previously disputed terms to resolve the issues in this petition.”). Patent
`Owner asserts the only construction that is “relevant to the issues raised in
`this Preliminary Response” is the term “agent.” Prelim. Resp. 17 n.4.
`We discuss the construction of “agent” below. We determine that no
`other terms require express construction for the purposes of this Decision.
`See Nidec Motor Corp. v. Zhongshan Broad Ocean Motor Co., 868 F.3d
`1013, 1017 (Fed. Cir. 2017) (citing Vivid Techs., Inc. v. Am. Sci. & Eng’g,
`Inc., 200 F.3d 795, 803 (Fed. Cir. 1999) (“[W]e need only construe terms
`‘that are in controversy, and only to the extent necessary to resolve the
`controversy.’”)).
`Regarding the term “agent,” Petitioner notes that in a prior district
`court proceeding, the magistrate judge recommended this construction: “a
`process that occupies a place and that is mobile, i.e., can move from a first
`
`12
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`Patent 7,949,752 B2
`place to a second place.” Pet. 16–17 (citing Ex. 1009, 24–26).9 Patent
`Owner proposes using this same construction in this proceeding. See Prelim.
`Resp. 17. We note, also, that this construction was agreed upon by the
`parties and adopted by the district court in the ongoing parallel proceeding.
`See Ex. 2001, 2; Ex. 3001, 1.
`This construction of “agent” is based on lexicography. The ’752
`patent incorporates the text of White. See Ex. 1001, 5:27–31 (“[A]n agent
`system is taught by U.S. Pat. No. 5,603,031 [White], issued to the Assignee
`of the present invention, the text of which is incorporated herein by
`reference.”); Prelim. Resp. 17–18. White includes a glossary specifically
`defining “agent” as “a process that occupies a place and that is mobile, i.e.,
`can move from a first place to a second place.” Ex. 1020, 16:65–67. This
`definition also is consistent with the embodiments described in the
`Specification of the ’752 patent. We therefore adopt the parties’ agreed
`upon construction for purposes of this Decision.
`
`D. Discretion Under 35 U.S.C. § 314(a)
`
`Patent Owner, relying on our precedential decisions in NHK10 and the
`Fintiv Order, contends that we should exercise our discretion under
`35 U.S.C. § 314(a) to deny institution based on the status of the parallel
`district court litigation. See Prelim Resp. 8–16.
`
`
`9 Petitioner refers also to an alternative construction of “agent” which it says
`was presented by Patent Owner in prior litigation. Pet. 17. Petitioner
`therefore “presents alternate grounds that account for both possible
`constructions.” Id.
`10 NHK Spring Co., Ltd. v. Intri-Plex Techs., Inc., IPR2018-00752, Paper 8
`(PTAB Sept. 12, 2018) (precedential).
`
`13
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`IPR2020-00470
`Patent 7,949,752 B2
`Legal Standards
`1.
`
`Under 35 U.S.C. § 314(a), the Director has discretion to deny
`institution of an inter partes review. Cuozzo Speed Techs., LLC v. Lee,
`136 S. Ct. 2131, 2140 (2016) (“[T]he agency’s decision to deny a petition is
`a matter committed to the Patent Office’s discretion.”); SAS Inst. Inc. v.
`Iancu, 138 S. Ct. 1348, 1356 (2018) (“SAS”) (“[Section] 314(a) invests the
`Director with discretion on the question whether to institute review.”
`(emphasis omitted)); Harmonic, 815 F.3d at 1367 (“[T]he PTO is permitted,
`but never compelled, to institute an IPR proceeding.”).
`In determining whether to exercise discretion to deny institution under
`35 U.S.C. § 314(a), the Board considers an early trial date in related
`litigation as part of an assessment of all relevant circumstances of the case,
`including the merits, in an effort to balance considerations such as system
`efficiency, fairness, and patent quality. Fintiv Order 5–6; see also NHK,
`Paper 8 at 19–20 (denying institution relying, in part, on § 314(a) because
`the parallel district court proceeding was scheduled to finish before the
`Board reached a final decision).
`When considering an early trial date in related litigation, the Board
`evaluates the following factors (“Fintiv factors”):
`1. whether the court granted a stay or evidence exists that one
`may be granted if a proceeding is instituted;
`2. proximity of the court’s trial date to the Board’s projected
`statutory deadline for a final written decision;
`3. investment in the parallel proceeding by the court and the
`parties;
`4. overlap between issues raised in the petition and in the parallel
`proceeding;
`
`14
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`IPR2020-00470
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`5. whether the petitioner and the defendant in the parallel
`proceeding are the same party; and
`6. other circumstances that impact the Board’s exercise of
`discretion, including the merits.
`Fintiv Order 5–6. In evaluating these factors, “the Board takes a holistic
`view of whether efficiency and integrity of the system are best served by
`denying or instituting review.” Id. at 6.
`
`2.
`
`Factual Background
`
`The progress of the related district court litigation is pertinent to
`discretion under 35 U.S.C. § 314(a). We summarize the progress as follows.
`On July 31, 2019, Patent Owner filed a Complaint (Ex. 1021) against
`Petitioner in the U.S. District Court for the Western District of Texas.
`Patent Owner served its infringement contentions on November 5,
`2019. Ex. 1013; see Prelim. Resp. 11. Petitioner served its initial invalidity
`contentions on January 15, 2020. Ex. 2002; see Prelim. Resp. 11.
`On February 10, 2020, Petitioner filed the Petition in this proceeding.
`See Paper 3 (according the Petition a filing date of February 10, 2020).
`A Markman hearing was held on May 14, 2020 and the district court
`issued a claim construction order on June 10, 2020.11 See Ex. 1027;
`Ex. 2005; Ex. 3001.
`Petitioner has filed in the District Court a stipulation indicating that if
`an IPR is instituted, it “will not assert invalidity of [the challenged claims]
`
`
`11 The Markman hearing addressed the claims of only a subset of the patents
`asserted in the parallel proceeding, including those of the ’752 patent. See
`Ex. 3001 (“The Court held Part 1 of the Markman hearing on May 14,
`2020.”). The parties have not provided, and we are unaware of, the schedule
`for Part 2 of the Markman hearing.
`
`15
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`based on any of the [asserted grounds], or on any other ground involving the
`[asserted] references alone or in combination with any other reference” in
`the District Court. Ex. 1026.
`Per the court’s Scheduling Order, Final Infringement and Invalidity
`Contentions were due July 1, 2020.12 Ex. 1012, 6. Further, fact discovery
`closes on October 16, 2020, and expert discovery closes on December 21,
`2020.13 Id. Dispositive motions are due on January 13, 2021. Id.
`The Scheduling Order states that trial is set for “(Early) April ___,
`2021 (subject to the Court’s availability)” and that “The Court expects to set
`this date at the conclusion of the Markman Hearing.” Ex. 1012, 7–8. The
`record does not indicate that an alternate date has been set. Cf. Ex. 1027,
`63:6–65:1 (discussing possible trial dates).
`
`3.
`
`Analysis of the Fintiv Factors
`
`With this background, we consider each of the factors set forth in the
`Fintiv Order. We then weigh the factors and take a holistic view of whether
`efficiency and integrity of the patent system are best served by denying or
`instituting review.
`
`Factor 1: whether a stay exists or is likely to be granted if a
`proceeding is instituted
`
`Petitioner asserts that “the District Court has not issued a stay in the
`parallel proceeding,” and that this factor, therefore, “do[es] not weigh
`
`
`12 Neither party has provided information regarding whether these
`contentions have been served, or if the date has been moved pending any
`second Markman hearing.
`13 The court’s Scheduling Order also indicates, however, that “all other
`discovery is stayed until after the Markman hearing.” Ex. 1012, 1.
`
`16
`
`
`
`IPR2020-00470
`Patent 7,949,752 B2
`against instituting inter partes review.” Reply 8. Patent Owner contends
`that the District Court “is unlikely to issue a stay if the IPR is instituted in
`this case,” arguing that this factor, therefore, favors denial. Sur-reply 1–2.
`Neither party has requested a stay of the parallel proceeding pending
`this inter partes review. Thus, the District Court has not ruled on this issue.
`Patent Owner contends that the judge in the parallel proceeding is “unlikely
`to issue a stay if the IPR is instituted in this case” because he has “previously
`denied a motion to stay when an IPR was instituted after claim construction
`was fully briefed and shortly before the claim construction hearing.” Id. at
`2. Patent Owner further contends that here, “the parties have already
`engaged in discovery and completed claim construction briefing, and the
`court has conducted a Markman hearing and issued its claim construction
`order.” Id. We decline to infer, however, how the District Court might rule,
`should a stay be requested by the parties in the parallel proceeding. This
`factor, therefore, does not weigh for or against discretionary denial in this
`case. See Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 15 at 12 (PTAB
`May 13, 2020) (informative) (“Fintiv DI”); Sand Revolution II, LLC v.
`Cont’l Intermodal Group – Trucking LLC, IPR2019-01393, Paper 24 at 7
`(PTAB June 16, 2020) (informative) (“Sand Revolution”).
`
`Factor 2: proximity of the court’s trial date to the Board’s
`projected statutory deadline
`
`Patent Owner argues that “the district-court trial will be completed
`months before the Board’s projected statutory deadline for a final written
`decision,” arguing that this factor, therefore, favors denial. Prelim. Resp.
`14–15. Petitioner contends that “the District Court has not yet set trial in the
`
`17
`
`
`
`IPR2020-00470
`Patent 7,949,752 B2
`parallel proceeding, and the trial could occur months after a Final Written
`Decision in this proceeding.” Reply 8 (citing Ex. 1027).
`As noted above, the Scheduling Order in the parallel proceeding set
`the jury trial to begin in “(Early) April ___, 2021 (subject to the Court’s
`availability)” (Ex. 1012, 8), approximately four months before a final written
`decision would be due in this proceeding (August 2021). The Scheduling
`Order appears to indicate an approximate trial date that is tentative based on
`the Court’s availability. Although there is some evidence that indicates that
`the trial date may change (see, e.g., Reply 8 (citing Ex. 1027, 64:2–22)), the
`District Court has not yet changed the date (see Sur-reply 3). “We generally
`take courts’ trial schedules at face value absent some strong evidence to the
`contrary.” Fintiv DI 13.
`“If the court’s trial date is earlier than the projected statutory deadline,
`the Board generally has weighed this fact in favor of exercising authority to
`deny institution under NHK.” Fintiv Order 9. Because the Scheduling
`Order has not definitively set a trial date, and, at earliest, trial is tentatively
`scheduled approximately four months before our deadline to reach a final
`decision, this factor weighs only somewhat in favor of discretionary denial
`in this case.
`
`Factor 3: investment in the parallel proceeding by the court
`and parties
`
`Patent Owner contends that “[t]he district court has already expended
`substantial resources to gain familiarity with and resolve the[] issues.”
`Prelim. Resp. 9. As noted above, the parties have already served their
`respective infringement contentions and initial invalidity contentions. The
`District Court completed a Markman hearing on May 14, 2020 and has
`
`18
`
`
`
`IPR2020-00470
`Patent 7,949,752 B2
`issued a claim construction order.14 See Ex. 1027; Ex. 3001. Under the
`current schedule, fact and expert discovery, dispositive motions, and trial are
`expected to occur prior to the August 2021 deadline for issuing a Final
`Written Decision in this proceeding. See Ex. 1012, 6–8. Petitioner contends
`that these dates in the parallel proceeding may change. See Reply 3–4.
`We recognize that much work remains in the parallel proceeding as it
`relates to invalidity: fact discovery is ongoing, expert reports are not yet
`due, and substantive motion practice is yet to come. Thus, although the
`parties and the District Court have invested effort in the parallel proceeding
`to date, further effort remains to be expended in this case before trial. The
`facts here are similar to those in both recent Board informative decisions.
`See Sand Revolution 11; Fintiv DI 14.
`We also find that the timing of the Petition was reasonable. Petitioner
`filed its Petition less than four weeks after serving its initial invalidity
`contentions and nearly six months before the statutory deadline. See Fintiv
`Order 11–12 (considering timing of the Petition as part of the third Fintiv
`factor).
`We find that this factor does not weigh for or against discretionary
`denial in this case.
`
`Factor 4: overlap between issues raised in the petition and in
`the parallel proceeding
`
`Patent Owner contends that “VMware has presented essentially the
`same art and grounds of unpatentability in its Petition that it is asserting in
`the district-court case.” Prelim. Resp. 9 (citing Ex. 2002 (Preliminary
`
`
`14 As noted above, the Markman hearing was for only a subset of patents at
`issue in the parallel proceeding, including the ’752 patent.
`
`19
`
`
`
`IPR2020-00470
`Patent 7,949,752 B2
`Invalidity Contentions)); see also Ex. 2004 (Invalidity Chart). Patent Owner
`also contends that “any relevant claim-construction issues necessary to
`resolve validity question, will of necessity be presented in both forums—and
`under the very same claim-construction standard.” Prelim. Resp. 10.
`Petitioner notes that it “has stipulated that if the Board institutes inter
`partes review of the challenged claims of the ’752 patent, [Petitioner] will
`not pursue invalidity on the same grounds or even the same reference
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