Case IPR2020-01082
`Patent No. 10,255,994
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`Paper 12
`October 16, 2020
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`UNITED STATES PATENT AND TRADEMARK OFFICE
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`______________________
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`_____________________
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`SOTERA WIRELESS, INC.
`Petitioner
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`v.
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`MASIMO CORPORATION
`Patent Owner
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`Case IPR2020-01082
`Patent No. 10,255,994
`_____________________
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`__________________________________________________________________
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`PETITIONER’S REPLY TO PRELIMINARY RESPONSE
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`Patent No. 10,255,994
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`Paper 12
`October 16, 2020
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`UNITED STATES PATENT AND TRADEMARK OFFICE
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`______________________
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`_____________________
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`SOTERA WIRELESS, INC.
`Petitioner
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`v.
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`MASIMO CORPORATION
`Patent Owner
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`Case IPR2020-01082
`Patent No. 10,255,994
`_____________________
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`__________________________________________________________________
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`PETITIONER’S REPLY TO PRELIMINARY RESPONSE
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`Case IPR2020-01082
`Patent No. 10,255,994
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`1006
`1007
`1008
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`1009
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`1010
`1011
`1012
`1013
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`1014
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`1016
`1017
`1018
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`1033
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`Exhibit Index
`Ex #
`U.S. Patent No. 10,255,994 (“the ’994 patent”)
`1001
`Prosecution History of the ’994 patent
`1002
`Expert Declaration of George Yanulis (“Yanulis Decl.”)
`1003
`Curriculum Vitae for George Yanulis
`1004
`1005 Masimo’s Infringement Contentions with Ex. H – ’994 Claim Chart,
`served January 24, 2020
`U.S. Patent No. 5,253,645
`U.S. Patent No. 6,816,266
`Aki Mäkivirta and Erkki M. J. Koski, Alarm-Inducing Variability in
`Cardiac Postoperative Data and the Effects of Prealarm Delay, 10 J
`Clinic Monit. 153–162 (1994) (“Mäkivirta”)
`A.T. Rheineck-Leyssius and C.J. Kalkman, Influence of Pulse Oximeter
`Settings on the Frequency of Alarms and Detection of Hypoxemia, 14 J.
`Clinic Monit. 151-156 (1998)
`U.S. Patent Publication No. 2008/0287756 to Lynn (“Lynn”)
`U.S. Patent Publication No. 2009/0247851 to Batchelder (“Batchelder”)
`U.S. Patent Publication No. US 2009/0326340 to Wang (“Wang”)
`A.T. Rheineck-Leyssius and C.J. Kalkman, Influence of Pulse Oximeter
`Lower Alarm Limit on the Incidence of Hypoxaemia in the Recovery
`Room, 79 British J. of Anaesthesia 460-464 (1997) (“Kalkman”)
`Declaration from Erika I. Cohn regarding Public Accessibility of
`Kalkman, dated May 20, 2020
`1015 Masimo’s Complaint for Patent Infringement against Sotera (ECF No. 1),
`filed June 12, 2019
`Service of Summons and Complaint upon Sotera (ECF No. 5)
`U.S. Patent No. 3,608,545
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`Intentionally omitted.
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`i
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`1035
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`Patent No. 10,255,994
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`1034 Masimo Corporation's Preliminary Claim Constructions and Extrinsic
`Evidence dated April 3, 2020
`Defendants Sotera Wireless, Inc. and Hon Hai Precision Industry Co.
`Ltd.'s Local Patent Rule 4.1 Preliminary Responsive Claim Constructions
`With Extrinsic Evidence dated July 24, 2020
`Defendant Sotera Wireless, Inc.'s Motion to Stay Proceedings, ECF No.
`48
`Order Vacating Claim Construction Hearing, ECF No. 81
`Defendants' Stipulation of Invalidity Contentions, ECF No. 86
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`1036
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`1037
`1038
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`ii
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`Patent No. 10,255,994
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`Petitioner respectfully submits this supplemental briefing addressing the
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`factors set forth in Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 11 at 6 (Mar.
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`20, 2020) (precedential). Paper 8.
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`STATUS OF THE DISTRICT COURT LITIGATION
`In the parallel district court litigation, Masimo Corp. v. Sotera Wireless, Inc.
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`and Hon Hai Precision Industry Co. Ltd., Civil Action No. 3:19-01100-BAS-NLS
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`(S.D. Cal.) (the “District Court Litigation”), Patent Owner Masimo Corporation
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`(“Masimo”) asserts infringement of nine patents1, including the ’994 Patent, each
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`of which issued from continuation or reissue applications filed in 2017 and 2018,
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`and very late in each patent’s life cycle. Masimo filed these applications in an
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`effort to cover Petitioner’s technology, on the market since 2013, because its
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`technology did not infringe any of Masimo’s many then-existing patents. In doing
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`so, however, Masimo’s newly obtained patent claims do not claim anything novel
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`or nonobvious at all, but merely claim what had existed in the prior art.
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`While +Masimo served its complaint on June 13, 2019, over the ensuing six
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`months virtually no activity occurred in the District Court litigation while the
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`parties engaged in settlement discussions. The District Court did not even hold its
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`1 Petitioner has filed petitions for inter partes review (“IPR”) against the other
`eight asserted patents in IPR2020-00912, IPR2020-00954, IPR2020-00967,
`IPR2020-01015, IPR2020-01019, IPR2020-01033, IPR2020-01054, IPR2020-
`01078.
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`initial case management conference until December 4, 2019, and did not issue a
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`scheduling order until December 9, 2019. EX2002. Only then did it become clear
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`the parties would not be able to settle and litigation activity began. Petitioner
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`tirelessly worked over the next few months to identify an expert witness, evaluate
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`potential art, and prepare nine petitions for IPR challenging a total of 183 claims.
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`Petitioner then filed a motion to stay the District Court Litigation. EX1036.
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`To date, the case schedule has been amended twice, with the latest amended
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`scheduling order setting the close of fact discovery for February 12, 2021, the close
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`of expert discovery for May 7, 2021 and trial for November 30, 2021. EX2009.
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`Moreover, on September 23, 2020, the day after the parties submitted opening
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`Markman briefs, the District Court vacated all Markman deadlines “[i]n light of
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`Defendant’s pending Motion to Stay,” stating it would “reset the hearing, if
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`necessary, immediately after the order on the Motion to Stay is issued.” EX1037
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`(emphasis added). In view of all Markman deadlines being indefinitely vacated, the
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`remainder of the schedule and the trial date remain uncertain.
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` THE FINTIV FACTORS COUNSEL AGAINST EXERCISING
`DISCRETION TO DENY
`Weighing the Fintiv factors holistically, the Board should decline to exercise
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`its discretion to deny institution.
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`Fintiv Factor #1: Petitioner filed a Motion to Stay on May 20, 2020, well
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`before Masimo filed its Preliminary Response. EX1036. The District Court
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`indicated a ruling is forthcoming when it vacated all Markman deadlines. EX1037.
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`Critically, the Court noted that any rescheduled Markman date may not be
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`necessary, depending on how the Court rules on the motion to stay. Id. Masimo’s
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`claim that “[a] stay is unlikely” is pure conjecture. At most, this factor is neutral.
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`Sand Revolution II, LLC v. Continental Intermodal Group-Trucking LLC, IPR
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`2019-01393, Paper 24 at 7 (PTAB June 16, 2020) (Informative).
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`Fintiv Factor #2: The Court has already amended its case management
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`order twice—including extending the trial date two months—and, with the
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`uncertainty surrounding the currently vacated Markman deadlines and the on-going
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`COVID-19 health crisis, the possibility of additional extensions cannot be
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`excluded. Apple Inc. v. Seven Networks, LLC, IPR2020-00235, Paper 10 at 8
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`(PTAB July 28, 2020) (“[T]he coronavirus pandemic already has disrupted the trial
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`date once, and the situation continually evolves.”).
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`Regardless, the current trial date is November 30, 2021, which two weeks
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`before the anticipated deadline for the Board to issue its Final Written Decision.
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`“Given the minimal amount of overlap between the currently scheduled trial and
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`the deadline for a decision in this proceeding—a few weeks—this factor strongly
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`weighs in favor of instituting inter partes review.” MED-EL Elektromedizinische
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`Geräte Ges.m.b.H. v. Advanced Bionics AG, IPR2020-00190, Paper 15 at 9-12
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`(PTAB June 3, 2020) (instituting IPR because trial date less than one month before
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`Final Written Decision and Markman hearing delayed twice). Here, where the
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`Final Written Decision will issue even closer to the scheduled trial date, and all
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`Markman deadlines have been indefinitely vacated, this factor weighs even more
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`strongly in favor of institution.
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`Fintiv Factor #3: The deadline to complete fact discovery is February 12,
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`2021 and the deadline to complete expert discovery is nearly three months after
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`that. EX2009. Although the parties have engaged in some discovery, it is unrelated
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`to invalidity issues and much remains to be completed. Moreover, if and when the
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`District Court reschedules the Markman deadlines and eventually issues a
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`Markman Order, it will address only the “top ten dispositive” terms identified by
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`the parties, among 46 disputed claim terms (most, if not all, of which will likely
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`need to be construed before trial). This factor thus weighs in favor of institution.
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`Fintiv, Paper 11 at 10; see also Church & Dwight Co., Inc. v. Batinkoff, No.
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`IPR2020-00168, Paper 11 at 15 (PTAB May 15, 2020) (finding third factor weighs
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`against denial because “the district court has not yet held a claim construction
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`hearing or issued a claim construction order.”); Sand Revolution II, Paper 24 at 11
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`(“Also, we recognize that much work remains in the district court case as it relates
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`to invalidity: fact discovery is still ongoing, expert reports are not yet due, and
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`substantive motion practice is yet to come.”).
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`Moreover, Petitioner was not dilatory in filing this petition. After the
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`complaint was filed, the parties spent the next six months engaged in settlement
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`discussions. Minimal activity occurred in the litigation until the District Court
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`issued a scheduling order in December 2019. EX2002. Masimo did not serve its
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`infringement contentions until January 24, 2020. EX2002, p. 1-2. Petitioner served
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`its initial invalidity contentions on March 20, 2020 (constituting over 5,000 pages
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`of claim charts)—concurrent with the nationwide shift to “work from home” and
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`the closing of counsels’ public offices. Id. Shortly thereafter, the District Court
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`extended Markman deadlines three months per the parties’ joint motion. EX2003.
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`During this time, Petitioner diligently worked to draft IPR petitions
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`challenging 9 patents and 183 claims. Although the grounds in Petitioner’s Petition
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`are similar to its initial invalidity arguments in the District Court Litigation, they
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`are not identical. Petitioner asserts additional references in the Petition not
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`originally asserted in the District Court Litigation. See EX2004. Petitioner also
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`sought inter parties review of all claims of the ’994 Patent, not only those that
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`Masimo currently asserts in the District Court Litigation, to mitigate the risk of
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`Masimo asserting additional claims after the one-year bar deadline under 35 U.S.C.
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`§ 315(b). Any claim of delay is thus not persuasive. Supercell Oy, Petitioner, v.
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`Gree, Inc., Patent Owner., No. PGR2020-00053, Paper 12 at 14-15 (PTAB Oct. 9,
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`2020) (“Although Petitioner filed its Petition late within the statutory filing
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`window, the evidence before us demonstrates that only minimal investments have
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`been made in the parallel proceeding. Thus, we are not persuaded that Petitioner’s
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`‘delay’ is a compelling reason to exercise discretion to deny institution.”).
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`Fintiv Factor #4: Petitioner’s petition seeks review of all claims of the ’994
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`Patent, not merely those at issue in the concurrent litigation. Samsung Electronics
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`Co., Ltd. v. Dynamics, Inc., IPR2020-00502, Paper 34 at 12 (PTAB Aug. 12, 2020)
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`(finding fourth factor weighs in favor of institution when the petition sought
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`review of all claims, not merely those at issue in the concurrent litigation). More
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`importantly, Petitioner, and real-party-in-interest Hon Hai Precision Industry Co.,
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`have offered Masimo a stipulation that, if IPR is instituted, they will not pursue in
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`the District Court Litigation any ground raised or that could have been reasonably
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`raised in an IPR. EX1038. Thus, there will be no overlap of invalidity issues
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`between the District Court litigation and IPR. This factor thus weighs in favor of
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`institution. See VMware, Inc. v. Intellectual Ventures I LLC, No. IPR2020-00470,
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`Paper 13 at 19-20 (PTAB Aug. 18, 2020); Sand Revolution II, Paper 24 at 11-12;
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`Nanocellect Biomedical, Inc. v. Cytonome/st, LLC, No. IPR2020-00551, Paper 19
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`at 21-23 (PTAB Aug. 27, 2020); Nvidia Corp. v. Tessera Advanced Techs., Inc.,
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`No. IPR2020-00708, Paper 9 at 16-17 (PTAB Sept. 2, 2020).
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`Fintiv Factor #5: Although Petitioner and Patent Owner are the same
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`parties in both proceedings, the Board nevertheless repeatedly declines to exercise
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`its discretion to deny institution despite this factor. See e.g., VMWare, Inc., Paper
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`13 at 20-21; Samsung Elecs., Paper 34 at 13-14.
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`Fintiv Factor #6: Masimo’s Preliminary Response misstates the record and
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`mischaracterizes Petitioner’s arguments, the prior art, and the scope of the ’994
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`Patent. First, Masimo, not Petitioner, identified the term “reporting module” as
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`governed by Section 112, ¶ 6 in the District Court Litigation. EX1034. To
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`streamline the issues, and because whether “reporting module” is governed by
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`Section 112, ¶ 6 is immaterial to infringement and invalidity in view of the
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`disputes between the parties, Petitioner identified function and structure for this
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`term in its responsive Markman disclosures on July 24, 2020—six weeks after
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`Petitioner filed this petition. EX1035. Masimo’s cited authority is thus
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`inapplicable. Second, Masimo argues Petitioner does not identify the features in
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`the proposed combinations that correspond to the claim language. This is false. See
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`e.g., Petition pp. 39-41 (identifying “reporting module” in Kalkman). Third,
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`contrary to Masimo’s arguments, Petitioner establishes why a PHOSITA would
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`have been motivated to combine the identified references. Petition pp. 36, 37, 39,
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`42–46, 49, 50–52, 64–70, 73, 74.
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`Case IPR2020-01082
`Patent No. 10,255,994
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`Dated: October 16, 2020
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`Respectfully submitted,
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`By: /Rudolph A. Telscher, Jr./
`Rudolph A. Telscher, Jr., Reg. No. 36,032
`Nathan P. Sportel, Reg No. 67,980
`Daisy Manning, Reg. No. 66,369
`HUSCH BLACKWELL LLP
`190 Carondelet Plaza, Suite 600
`St. Louis, MO 63105
`(314) 480-1500 Telephone
`(314) 480-1505 Facsimile
`PTAB-RTelscher@huschblackwell.com
`Nathan.Sportel@huschblackwell.com
`PTAB-DManning@huschblackwell.com
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`Attorneys for Petitioner
`Sotera Wireless, Inc.
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`Case IPR2020-01082
`Patent No. 10,255,994
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`CERTIFICATE OF SERVICE
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`I hereby certify that on this 16th day of October 2020, the foregoing was
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`served via electronic mail to the attorneys of record for the ’994 patent at the
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`following address:
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`By: /Rudolph A. Telscher, Jr./
`Rudolph A. Telscher, Jr.
`Reg. No. 36,032
`Lead Counsel for Petitioner
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`Derek Bayles, Reg. No. 66,226
`derek.bayles@knobbe.com
`KNOBBE, MARTENS, OLSON & BEAR, LLP
`2040 Main Street, 14th Floor
`Irvine, CA 92614
`Benjamin A. Katzenellenbogen (Reg. No. 53,102), 2bak@knobbe.com
`Irfan A. Lateef (Reg. No. 51,922), 2ial@knobbe.com
`Brian C. Claassen (Reg. No. 63,051), 2bcc@knobbe.com
`SoteraIPR994@knobbe.com
`KNOBBE, MARTENS, OLSON & BEAR, LLP
`2040 Main Street, 14th Floor
`Irvine, CA 92614
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`HB: 4839-9214-0238.3
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