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`
`
`IN THE
`Supreme Court of the United States
`
`
`PERSONALIZED MEDIA COMMUNICATIONS,
`Petitioner,
`
`
`
`v.
`APPLE INC.,
`
`
`
`
`
`Respondent.
`
`
`
`
`On Petition for a Writ of Certiorari to the
`United States Court of Appeals for the Federal Circuit
`
`
`William M. Jay
`GOODWIN PROCTER LLP
`1900 N Street, NW
`Washington, DC 20036
`
`
`PETITION FOR A WRIT OF CERTIORARI
`
`
`Kevin P. Martin
` Counsel of Record
`Douglas J. Kline
`Gerard J. Cedrone
`GOODWIN PROCTER LLP
`100 Northern Avenue
`Boston, MA 02210
`kmartin@goodwinlaw.com
`(617) 570-1000
`
`Counsel for Petitioner
`
`
`September 7, 2023
`
`
`
`
`
`QUESTIONS PRESENTED
`Petitioner entered a docket-management agree-
`ment with the Patent and Trademark Office (PTO) es-
`tablishing a process for examination of petitioner’s pa-
`tent applications. Over the next two decades, peti-
`tioner complied with that agreement and the PTO is-
`sued petitioner nearly 100 patents, including a patent
`petitioner successfully asserted against respondent in
`an infringement action. But in a 2-1 decision, the Fed-
`eral Circuit held that the patent was unenforceable
`under the equitable doctrine of prosecution laches,
`reasoning that the PTO’s docket-management deci-
`sions had allowed “unreasonable” delays during ex-
`amination.
`Where an applicant has complied with statutory
`deadlines, this Court has refused to find patents un-
`enforceable on the basis of laches. Overland Motor Co.
`v. Packard Motor Car Co., 274 U.S. 417 (1927); SCA
`Hygiene Prods. v. First Quality Baby Prods., 580 U.S.
`328 (2017). And Congress has given the PTO author-
`ity to set rules “govern[ing] the conduct of proceedings
`in the Office.” 35 U.S.C. §2(b)(2)(A). Thus, the Fed-
`eral Circuit has held elsewhere that compliance with
`PTO instructions during examination affords an ap-
`plicant “the opportunity to avoid prosecution laches.”
`Hyatt v. Hirshfeld, 998 F.3d 1347, 1366 (2021).
`The questions presented are:
`1. Whether prosecution laches can be based on an
`applicant’s prosecution of a patent application in com-
`pliance with the PTO’s docket-management decisions.
`2. Whether the doctrine of prosecution laches, as
`articulated by the Federal Circuit, is a valid patent-
`infringement defense in light of SCA Hygiene.
`
`i
`
`
`
`
`
`
`
`PARTIES TO THE PROCEEDING
`All parties appear in the caption of the case on the
`cover page.
`CORPORATE DISCLOSURE STATEMENT
`Petitioner Personalized Media Communications,
`LLC, has no parent corporations and no publicly held
`company owns 10% or more of its stock.
`RELATED PROCEEDINGS
`U.S. District Court for the Eastern District of Texas:
`Personalized Media Communications, LLC v. Ap-
`ple Inc., No. 2:15-cv-1366 (Aug. 6, 2021)
`U.S. Court of Appeals for the Federal Circuit:
`Personalized Media Communications, LLC v. Ap-
`ple Inc., No. 2021-2275 (Jan. 20, 2023)
`
`
`ii
`
`
`
`
`
`TABLE OF CONTENTS
`Introduction .................................................................1
`Opinions Below ............................................................4
`Jurisdiction ..................................................................4
`Statement ....................................................................4
`A. PMC files separate patent applications
`on a number of discrete inventions.................4
`B. The PTO enters into an agreement
`with PMC to streamline prosecution
`and subsequently issues PMC nearly
`100 patents. .....................................................6
`C. The PTO issues the ’091 patent with
`claims directed to decryption. ....................... 11
`D. A jury finds that Apple’s FairPlay
`technology infringes the ’091 patent. ........... 13
`E. The district court invokes prosecution
`laches to wipe out the jury’s verdict. ............ 15
`F. The Federal Circuit affirms the district
`court’s judgment over a dissent. ................... 16
`Reasons for Granting the Writ ................................. 18
`I. The Court should consider whether
`prosecution laches can be based on the
`PTO’s docket-management decisions. .......... 19
`A. The Federal Circuit’s holding
`conflicts with this Court’s decisions. ....... 19
`B. The Federal Circuit’s decision
`departs from previous decisions of
`that court. ................................................. 23
`
`iii
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`
`
`
`
`C. The Federal Circuit’s decision
`introduces unpredictability and
`unfairness into the patent system. ......... 26
`D. This case is a suitable vehicle to
`address the question presented. .............. 30
`II. The Court should consider whether the
`doctrine of prosecution laches survives
`this Court’s decision in SCA Hygiene. .......... 32
`Conclusion ................................................................. 33
`Appendix A: Opinion of the U.S. Court of
`Appeals for the Federal Circuit (Jan. 20,
`2023) ..................................................................... 1a
`Appendix B: Memorandum Opinion and Order
`of the U.S. District Court for the Eastern
`District of Texas (Aug. 5, 2021) ......................... 38a
`Appendix C: Order of the U.S. Court of
`Appeals for the Federal Circuit on Petition
`for Panel Rehearing and Rehearing En
`Banc (May 10, 2023) .......................................... 88a
`
`
`
`iv
`
`
`
`
`
`TABLE OF AUTHORITIES
`
`Cases:
`Amgen Inc. v. Sanofi,
`598 U.S. 594 (2023) ................................................ 6
`Athena Diagnostics, Inc. v. Mayo
`Collaborative Servs., LLC,
`927 F.3d 1333 (Fed. Cir. 2019) ............................ 26
`Avid Identification Sys., Inc. v. Crystal
`Imp. Corp.,
`603 F.3d 967 (Fed. Cir. 2010) .............................. 24
`In re Bogese,
`303 F.3d 1362 (Fed. Cir. 2002) ........................ 2, 19
`Bos. Sci. Corp. v. Cook Med. LLC,
`2023 WL 3691113 (S.D. Ind. May 27,
`2023) ..................................................................... 28
`Bridgestone Americas Tire Operations,
`LLC v. Speedways Tyres Ltd.,
`2023 WL 5105776 (N.D. Tex. Aug. 9,
`2023) ..................................................................... 28
`In re Buszard,
`504 F.3d 1364 (Fed. Cir. 2007) ............................ 27
`Columbus Bd. of Ed. v. Penick,
`443 U.S. 449 (1979) .............................................. 29
`Godo Kaisha IP Bridge 1 v.
`Telefonaktiebolaget LM Ericsson,
`2022 WL 2055234 (E.D. Tex. June 6,
`2022) ..................................................................... 28
`Ex Parte Hull,
`191 U.S.P.Q. 157 (P.T.O. Bd. App.
`1975) ..................................................................... 19
`
`v
`
`
`
`
`Hyatt v. Hirshfeld,
`998 F.3d 1347 (Fed. Cir. 2021) ............. 1, 2, 16, 17,
` ...................................................... 18, 23, 24, 25, 31
`IT Casino Sols., LLC v. Transient Path, LLC,
`2022 WL 4913526 (N.D. Cal. Oct. 3, 2022) ......... 28
`Luther v. Dep’t of Commerce,
`107 M.S.P.R. 616 (M.S.P.B. 2008) ....................... 10
`Luther v. Gutierrez,
`618 F. Supp. 2d 483 (E.D. Va. 2009) ................... 10
`Natera, Inc. v. Archerdx, Inc.,
`2021 WL 4284580 (D. Del. Sept. 21,
`2021) ..................................................................... 28
`Natera, Inc. v. Genosity Inc.,
`2022 WL 767602 (D. Del. Mar. 14,
`2022) ..................................................................... 28
`Overland Motor Co. v. Packard Motor
`Car Co.,
`274 U.S. 417 (1927) .............................. 2, 19, 20, 21
`Personalized Media Commc’ns v. Apple Inc.,
`952 F.3d 1336 (Fed. Cir. 2020) ............................ 14
`SCA Hygiene Prods. v. First Quality
`Baby Prods.,
`580 U.S. 328 (2017) ............................... 2, 3, 18, 19,
` ............................................................ 20, 21, 32, 33
`In re Schneller,
`397 F.2d 350 (C.C.P.A. 1968)................................. 7
`Seagen Inc. v. Daiichi Sankyo Co.,
`2022 WL 2789901 (E.D. Tex. July 15,
`2022) ..................................................................... 28
`
`vi
`
`
`
`
`Star Sci., Inc. v. R.J. Reynolds Tobacco Co.,
`537 F.3d 1357 (Fed. Cir. 2008) ............................ 29
`Symbol Techs., Inc. v. Lemelson Med.,
`Educ. & Rsch. Found.,
`422 F.3d 1378 (Fed. Cir. 2005) ...................... 25, 26
`Therasense, Inc. v. Becton, Dickinson & Co.,
`649 F.3d 1276 (Fed. Cir. 2011) (en banc) ............ 29
`WSOU Invs. LLC v. Arista Networks, Inc.,
`2021 WL 6015526 (W.D. Tex. Nov. 5,
`2021) ..................................................................... 28
`Statutes:
`28 U.S.C. §1254(1) ....................................................... 4
`35 U.S.C. §2(a) ........................................................... 19
`35 U.S.C. §2(b)(2)(A) ............................................. 2, 19
`35 U.S.C. §102 (2011) ................................................ 14
`35 U.S.C. §103 (2011) ................................................ 14
`35 U.S.C. §112 (2011) ................................................ 14
`35 U.S.C. §112 ............................................................. 6
`35 U.S.C. §154(a)(2) .................................................... 5
`35 U.S.C. §154(c)(1) ..................................................... 5
`35 U.S.C. §253(b) ......................................................... 8
`35 U.S.C. §286 ........................................................... 21
`Rev. Stat. §4894 ......................................................... 20
`Uruguay Round Agreements Act, Pub.
`L. 103-465, 108 Stat. 4809 ..................................... 5
`Regulations:
`37 C.F.R. §1.129 .......................................................... 5
`
`vii
`
`
`
`
`37 C.F.R. §1.129(b) ...................................................... 6
`37 C.F.R. §1.136(a) .................................................... 32
`37 C.F.R. §1.321 .......................................................... 8
`Other Authorities:
`Dyk, Hon. Timothy B., Federal Circuit
`Jurisdiction: Looking Back and
`Thinking Forward, 67 Am. U. L.
`Rev. 971, 977 (2018) ............................................. 26
`Gruner, Richard, Lost in Patent
`Wonderland with Alice: Finding the
`Way Out, 72 Syracuse L. Rev. 1053,
`1110 (2022) ........................................................... 27
`
`
`
`
`
`viii
`
`
`
`1
`Personalized Media Communications, LLC (PMC),
`respectfully petitions for a writ of certiorari to review
`the judgment of the United States Court of Appeals
`for the Federal Circuit.
`INTRODUCTION
`PMC proved to a jury that Apple knowingly in-
`fringed U.S. Patent No. 8,191,091 (’091 patent), and
`the jury awarded PMC $308.5 million in damages.
`Apple presented no invalidity defenses to the jury and
`no inequitable-conduct defense to the district court.
`But the district court threw out the verdict and, in a
`2-1 decision, the Federal Circuit affirmed.
`To reach this outcome, the courts below relied on
`the judge-made doctrine of prosecution laches, under
`which a patent is unenforceable if the applicant com-
`mitted “an egregious misuse of the statutory patent
`system” by engaging in “unreasonable and unex-
`plained delay in prosecution” while others were in-
`vesting in the patented technology.
` Hyatt v.
`Hirshfeld, 998 F.3d 1347, 1359-1360 (Fed. Cir. 2021).
`The Federal Circuit thought PMC had caused such de-
`lays because, in 1999, PMC and the Patent and Trade-
`mark Office (PTO) entered a docket-management
`agreement under which PMC consolidated its pending
`claims into half as many applications and then se-
`quenced the remaining applications’ prosecutions.
`Following years of effort by both PTO examiners and
`PMC’s prosecution counsel, the PTO issued PMC
`nearly 100 patents, including the ’091 patent in 2011.
`To the Federal Circuit, the PMC-PTO docket-man-
`agement agreement was the problem; the court dis-
`paraged the agreement as a “scheme” that improperly
`allowed PMC to “extend out prosecution” of the ’091
`
`
`
`
`
`2
`patent from 1999 until 2011. Pet. App. 5a. In that
`court’s view, even though the PTO’s docket-manage-
`ment decisions caused the prosecution of the ’091 pa-
`tent to last as long as it did, PMC should be proscribed
`from enforcing that indisputably valid patent.
`The Federal Circuit’s decision represents a radical
`departure from settled case law and a dramatic intru-
`sion into the PTO’s management of its own docket.
`This Court repeatedly has explained that laches, as
`an equitable doctrine, can only fill gaps and so does
`not apply when a patentee complies with statutory
`deadlines. See Overland Motor Co. v. Packard Motor
`Car Co., 274 U.S. 417, 424 (1927); SCA Hygiene Prods.
`v. First Quality Baby Prods., 580 U.S. 328, 334-335
`(2017). Likewise, the Federal Circuit has held else-
`where that an applicant’s compliance with the PTO’s
`instructions during prosecution affords the applicant
`“the opportunity to avoid prosecution laches.” Hyatt,
`998 F.3d at 1366. The Federal Circuit’s reasoning be-
`low casts aside these settled limits on equity, allowing
`judges to find patents unenforceable based on a course
`of prosecution that the PTO expressly allowed.
`That reasoning defies Congressional design and
`separation-of-powers principles in the manner this
`Court rejected in SCA Hygiene. Congress directed the
`PTO to “establish regulations” to “govern the conduct
`of proceedings in the Office.” 35 U.S.C. §2(b)(2)(A).
`That delegated power includes the authority to “set
`reasonable deadlines and requirements for the prose-
`cution of applications.” In re Bogese, 303 F.3d 1362,
`1368 (Fed. Cir. 2002). Exercising this authority, the
`PTO can itself invoke laches as a basis to reject an ap-
`plication if it finds that an applicant has been egre-
`giously delaying prosecution. See, e.g., id. at 1367.
`
`
`
`
`
`3
`Here, the PTO exercised its docket-management
`authority by entering an agreement with PMC to se-
`quence the examination of PMC’s applications. There
`was no finding or evidence that PMC tricked the PTO
`into entering that agreement (as with the patent-law
`defense of inequitable conduct), and the district court
`specifically found that PMC’s sequenced prosecution
`of the ’091 patent through 2011 was allowed by the
`PMC-PTO agreement. The Federal Circuit gave no
`weight to the fact the PTO did not reject any of PMC’s
`applications on the basis of laches. Indeed, another
`PTO docket-management decision caused much of the
`delay between 1999 and 2011: over PMC’s objections,
`the PTO stayed examination of PMC’s pending appli-
`cations from 2003 to 2009 while it reexamined PMC’s
`previously-issued patents. By nonetheless finding
`that laches should apply to the ’091 patent, the Fed-
`eral Circuit usurped docket-management authority
`that Congress granted to the PTO.
`The decision below requires this Court’s attention.
`There is nothing equitable about finding a patent un-
`enforceable for procedural reasons where the PTO
`agreed to the process and did not itself deny the pa-
`tent application on the basis of laches. Left un-
`checked, the Federal Circuit’s holding will introduce
`unpredictability and unfairness into the patent-exam-
`ination process. Now, even if the PTO expressly
`agrees to a process for the prosecution of a patent ap-
`plication, the applicant must worry that, years later,
`a judge will second-guess the PTO and find an issued
`patent unenforceable. The Court should grant certio-
`rari either to realign doctrine of prosecution laches
`with precedent and sound policy, or to hold that the
`doctrine in the form articulated by the Federal Circuit
`did not survive SCA Hygiene.
`
`
`
`
`
`4
`OPINIONS BELOW
`The opinion of the court of appeals (Pet. App. 1a-
`37a) is reported at 57 F.4th 1346. The opinion of the
`district court (Pet. App. 38a-87a) is reported at 552 F.
`Supp. 3d 664.
`
`JURISDICTION
`The judgment of the court of appeals was entered
`on January 20, 2023. A timely petition for rehearing
`was denied on May 10, 2023 (Pet. App. 88a-89a). On
`June 22, 2023, the Chief Justice extended the time to
`file a petition for a writ of certiorari to September 7,
`2023. See No. 22A1105. The jurisdiction of this Court
`is invoked under 28 U.S.C. §1254(1).
`STATEMENT
`A. PMC files separate patent applications on a
`number of discrete inventions.
`The technology behind PMC’s inventions stems
`from the vision and efforts of the company’s founder
`and chair, John Harvey. Mr. Harvey gained experi-
`ence in the encryption and decryption of radio broad-
`casts as a communications officer in the Navy and
`later studied computer functionality and program-
`ming in business school. C.A. App. 5607-5608. Draw-
`ing on this experience, Mr. Harvey and a friend in-
`vented a communications system that uses signals
`embedded in broadcast programming. C.A. App.
`5582, 5608-5609. The two men drafted a patent ap-
`plication themselves, which they filed in November
`1981. Pet. App. 41a-42a. After six years of examina-
`tion, their first patent issued on September 15, 1987.
`Pet. App. 42a.
`
`
`
`
`
`5
`The applicants filed a second patent application in
`September 1987. Pet. App. 42a-43a. Between 1987
`and 1994, PMC prosecuted a number of “continuation”
`applications, all of which issued as patents within one
`to three years of filing. See C.A. App. 8075-8077.
`PMC also began licensing its technology to other com-
`panies, including Sony and StarSight Telecast. See
`C.A. App. 5583. PMC ultimately licensed its patents
`to dozens of companies. C.A. App. 5583-5584.
`In late 1994, Congress enacted legal changes stem-
`ming from the Uruguay Round of the General Agree-
`ment on Tariffs and Trade. See Uruguay Round
`Agreements Act, Pub. L. 103-465, 108 Stat. 4809.
`Those changes included adjusting the statutory pa-
`tent term from 17 years from the issuance of a patent
`to 20 years from the filing of the earliest priority ap-
`plication that led to the patent. See 35 U.S.C.
`§154(a)(2). Congress chose not to give these new rules
`immediate effect. Instead, it provided that any new
`patent applications filed by June 8, 1995—six months
`from the date of enactment—could benefit from the
`old issuance-based patent term. See §154(c)(1); 37
`C.F.R. §1.129.
`This grandfather period created a well-docu-
`mented incentive for inventors to file applications be-
`fore the period ended. After the law’s passage, the
`PTO “prepared a series of contingency plans to effec-
`tively respond” to the expected influx. C.A. App. 8078.
`The agency “received and processed over 50,000 appli-
`cations for patents during the nine days prior to the
`June 8th deadline”—an “increase of approximately
`45,000 applications above what normally would have
`been filed during the period.” Id.
`
`
`
`
`
`6
`In the run-up to the June 1995 deadline, PMC con-
`ducted a study of the specifications1 of its 1981 and
`1987 applications and concluded that they “disclosed
`many separate and distinct inventions which had not
`yet been patented.” C.A. App. 38488. Because then-
`applicable PTO rules for post-GATT prosecution gen-
`erally required each unique invention to be examined
`in a separate application, PMC filed 328 applica-
`tions—one for each invention it identified—between
`March and June of 1995. C.A. App. 8077, 9537; Pet.
`App. 48a; see 37 C.F.R. §1.129(b).
`B. The PTO enters into an agreement with
`PMC to streamline prosecution and
`subsequently issues PMC nearly 100 patents.
`Beginning shortly after it filed its applications in
`June 1995, PMC experienced a number of delays in
`examination that were the result of the PTO’s docket-
`management decisions. To start, PMC met with ex-
`aminers in August 1995 to discuss the agency’s plan
`for examining its applications. C.A. App. 16687. The
`PTO told PMC that examination would not begin until
`“late October” at the earliest because the agency
`needed to complete “employee performance ratings”
`and “other end of fiscal year assignments.” C.A. App.
`16688.
`After this initial agency-imposed delay, the PTO’s
`examinations got underway. PMC offered the PTO a
`subject-matter “categorization of the inventions and
`the patent applications that were claiming each …
`
`1 The specification is the portion of a patent or patent application
`providing “written description of the invention.” 35 U.S.C.
`§112(a); see generally Amgen Inc. v. Sanofi, 598 U.S. 594, 605
`(2023).
`
`
`
`
`
`7
`group.” C.A. App. 9543. The PTO elected not to make
`use of PMC’s categorizations at that time. C.A. App.
`9544.
`Another set of agency actions then stalled exami-
`nation. In 1996 and 1997, the PTO rejected many of
`the claims in PMC’s applications based on a theory of
`“non-obviousness non-statutory type double patent-
`ing.” C.A. App. 8078; see Pet. App. 52a; In re Schnel-
`ler, 397 F.2d 350 (C.C.P.A. 1968) (case relied upon by
`the PTO for this theory). PMC appealed the agency’s
`rejections and, after considering PMC’s points, the
`agency withdrew the rejections “[i]n view of further
`analysis and [PMC]’s arguments.” C.A. App. 20404;
`see C.A. App. 9545-9546, 16739-16754, 16761-16783.
`In short, examination was delayed based on substan-
`tive objections by the PTO that the agency then
`dropped, crediting PMC.
`Once examination resumed, PMC met with the ex-
`aminers to see if an agreement could be reached on a
`plan for examination. In November 1998, PMC gave
`the PTO a document grouping all of its applications
`into 56 subject-matter categories and providing a pri-
`ority date (either 1981 or 1987) for each application.
`Pet. App. 5a, 54a.
`What happened next lies at the heart of this peti-
`tion. Based on the subject-matter grouping PMC gave
`the PTO in 1998, PMC and the PTO entered into a
`“consolidation agreement” in 1999. See Pet. App. 5a.
`The agreement reduced the number of PMC’s applica-
`tions from 328 to 157, with PMC consolidating the ap-
`plications based on their subject-matter category and
`priority date. See Pet. App. 54a; C.A. App. 27711-
`27735. The agreement further called for PMC to des-
`
`
`
`
`
`8
`ignate each application either an “A” or “B” applica-
`tion. PMC and the PTO agreed that the agency would
`focus first on the “A” applications, which could issue
`more quickly with the claims the PTO and PMC could
`more easily agree were patentable, after which the
`PTO would consider more difficult claims in the “B”
`applications. See Pet. App. 54a. “B” patents would be
`terminally-disclaimed to their “A” counterparts where
`PMC and the PTO agreed that the “B” applications
`contained matter patentably indistinct from what had
`been allowed in the “A” applications. This would en-
`sure that, in appropriate circumstances, the trailing
`issuance of the “B” patents would not extend the pa-
`tent coverage of any particular invention. See C.A.
`App. 47925-47929.2 Thus, by no later than 1999, PMC
`was engaged in cooperative efforts with the PTO to
`keep the examination process moving and to expedite
`the issuance of some patents, to which any subse-
`quently-issued patents would be terminally dis-
`claimed as appropriate.
`But examination was delayed once again in 2001
`when patent examiner William Luther issued a “no-
`tice of abandonment” in several of PMC’s then-pend-
`ing applications. Pet. App. 54a-55a. Mr. Luther ap-
`pended a memorandum to the notice evincing blatant
`hostility toward nonpracticing entities like PMC and
`attacking the conduct of PMC and its counsel both in-
`side and outside of examination. See Pet. App. 54a-
`55a; C.A. App. 8081, 20512-21138, 20526. Mr. Luther
`
`2 A “terminal disclaimer” allows a patentee to give up “any ter-
`minal part” of a patent’s lifespan. 35 U.S.C. §253(b); 37 C.F.R.
`§1.321. Among other things, this mechanism allows a patentee
`to ensure that the expiration date of a later-issuing patent is the
`same as that of an earlier-issuing patent.
`
`
`
`
`
`9
`also asserted that prosecution laches should apply to
`PMC’s applications. C.A. App. 20535-20538.
`PMC petitioned the PTO to withdraw the notice of
`abandonment and the agency agreed. Pet. App. 55a;
`see C.A. App. 8081-8082, 21139-21274. PMC’s peti-
`tion recounted PMC’s negotiations with the PTO and
`the terms of the consolidation agreement and re-
`sponded to the substance of Mr. Luther’s attacks. C.A.
`App. 8081, 21142-21143, 21158-21181. Following an
`interview between PMC and the supervisory patent
`examiner, the PTO vacated the office action—and
`even apologized to PMC. The agency’s interview sum-
`mary stated that:
`[T]he Supervisory Patent Examiner has deter-
`mined that the allegations made in and the
`conclusions drawn from the attachments are
`unrelated to the issue of patentability of the
`subject matter claimed in applicants’ pending
`applications and were not made pursuant to a
`duty of the Examiner imposed by law. Any in-
`convenience to applicants is regretted. No fur-
`ther action is required to the Notice of Aban-
`donment in this application.
`C.A. App. 8081, 21282 (emphasis added). The PTO
`formally withdrew the notice of abandonment in April
`2002. C.A. App. 8082, 21283-21285 (“[T]he notice of
`Abandonment is hereby vacated and the holding of
`
`
`
`
`
`10
`abandonment withdrawn.”). The agency also re-
`moved Mr. Luther from examining PMC’s applica-
`tions. C.A. App. 9566.3
`Prosecution then resumed, and a 2002 communi-
`cation from the PTO recognized PMC’s “bona fide at-
`tempt to advance” the application that later became
`the ’091 patent. C.A. App. 16845. But progress was
`stalled again in 2003, when the PTO suspended exam-
`ination of all of PMC’s pending applications while it
`reexamined certain of PMC’s previously-issued pa-
`tents. See PMC C.A. Br. 20-22. PMC strenuously ob-
`jected to this suspension, emphasizing that a number
`of its applications were nearly ready to be granted,
`and it repeatedly asked the PTO to resume the exam-
`inations. C.A. App. 19554-19560. But the PTO did
`not lift the suspension until 2009—after it had reaf-
`firmed the patentability of a number of PMC’s claims.
`See PMC C.A. Br. 22; see also C.A. App. 9568. Thus,
`once again, examination of PMC’s applications was
`delayed—this time for about six years—over PMC’s
`objections for substantive reasons that PMC overcame
`on the merits.
`Once examination finally resumed, the PTO began
`issuing patents to PMC almost immediately. The
`agency issued PMC 41 patents in 2010 and another 14
`patents in 2011, with dozens more in the years that
`followed. See C.A. App. 8526, 9569. At no point did
`the PTO ever invoke prosecution laches as the basis
`for denying any of PMC’s applications.
`
`
`3 Mr. Luther was subsequently removed from his position as a
`patent examiner for misconduct. See Luther v. Dep’t of Com-
`merce, 107 M.S.P.R. 616 (M.S.P.B. 2008); Luther v. Gutierrez,
`618 F. Supp. 2d 483 (E.D. Va. 2009).
`
`
`
`
`
`11
`C. The PTO issues the ’091 patent with claims
`directed to decryption.
`The patent claims at issue in this lawsuit—claims
`13-17 of the ’091 patent—are directed to “[a] method
`of decrypting programming at a receiver station” us-
`ing information embedded in an encrypted digital in-
`formation transmission. C.A. App. 243. The claimed
`invention is particularly useful for controlling access
`to paid programming by prohibiting access to persons
`lacking the necessary digital key. C.A. App. 5655-
`5658
`The claims of the ’091 patent have their origin in
`two of PMC’s 1995 applications: U.S. Patent Applica-
`tion No. 08/474,145 (’145 application) and U.S. Patent
`Application No. 08/485,507 (’507 application). In No-
`vember 1998, PMC identified both applications as
`“relat[ing] to decryption of broadcast information” in
`the subject-matter grouping PMC provided to the
`PTO. C.A. App. 27711 (identifying “DECR” as the ab-
`breviation for the category that “relates to decryption
`of broadcast information”); C.A. App. 27720 (placing
`both the ’145 application and the ’507 application in
`the “DECR” category); see Pet. App. 31a-32a (Stark,
`J., dissenting); supra, pp. 6-7.
`After the PTO and PMC entered the consolidation
`agreement, the ’145 application was designated as an
`“A” application and the ’507 application as the com-
`panion “B” application. Pet. App. 59a; see also C.A.
`App. 27734. In keeping with the consolidation agree-
`ment, both PMC and the PTO understood that exam-
`ination of the ’145 application would proceed first. See
`supra, pp. 7-8. The PTO expressly acknowledged this
`arrangement in correspondence with PMC, noting
`that, “per the consolidat[ion] agreement between
`
`
`
`
`
`12
`[PMC] and the PTO, the prosecution on merits of the
`instant B application [i.e., the ’507 application] [was]
`suspended and held in abeyance pending the outcome
`of the corresponding ‘A’ application 08/474,145.” C.A.
`App. 16848.
`By 2003, in response to an examiner’s rejection of
`what became the claims-in-suit on the ground that
`they were obvious over the prior art, PMC narrowed
`the claims by amending “disabled” information to only
`“encrypted” information and amending an “enabling”
`step to more specifically a “decrypting” step. E.g., Pet.
`App. 63a-64a. This narrowing amendment was con-
`sistent with PMC’s explanation to the PTO in 1997
`that “encrypted” information is one type of “disabled”
`information. C.A. App. 40139; see also Pet. App. 32a
`(Stark, J., dissenting) (“These amendments narrowed
`and limited the scope of the claims to … elements that
`were present in the claims at least as far back as
`1997.”). As a result of this narrowing amendment, the
`claims-in-suit were present in the ’145 application in
`essentially final form by 2003, within just a few years
`of the 1999 PTO-PMC consolidation agreement—as
`the district court expressly recognized. See Pet. App.
`80a-81a; see also Pet. App. 7a-8a, 63a-64a, 85a. But
`as recounted above, examination of those claims was
`then delayed from 2003 until 2009 while the PTO
`reexamined PMC’s previously-issued patents. See su-
`pra, p. 10.
`After examination of the claims-in-suit resumed in
`2009, PMC agreed in an examiner interview to further
`narrow the 2003 versions of the claims in the ’145 “A”
`application so that the claims could issue without de-
`lay. Pet. App. 33a-34a. Pursuant to the consolidation
`agreement, PMC then continued prosecuting the
`
`
`
`
`
`13
`broader 2003 versions of the claims in the ’507 “B” ap-
`plication. C.A. App. 16863-16864. The district court
`expressly found that the consolidation agreement al-
`lowed this approach, and PMC fully disclosed to the
`PTO what it was doing at the time. See Pet. App. 80a-
`81a (finding that “the agreement permitted PMC in
`2011 to present to the PTO [its] claim [as] initially
`presented in 2003”); C.A. App. 16864 (explaining to
`examiners that PMC was seeking “subject matter
`within the scope of the ‘A’ claims … that was not pa-
`tented in the ‘A’ application”). With minor amend-
`ments, the 2003 versions of the claims issued as the
`claims-in-suit in the ’091 patent in 2012. Pet. App.
`67a-68a. That was just one year after the correspond-
`ing “A” patent issued in 2011, and the two patents
`were terminally disclaimed to the same date. C.A.
`App. 40528, 48289.
`D. A jury finds that Apple’s FairPlay
`technology infringes the ’091 patent.
`1. In the “early 2000s”—after the 1999 PMC-PTO
`consolidation agreement—Apple began developing
`software it named “FairPlay,” a “digital rights man-
`agement” system that stops piracy of content deliv-
`ered to customers through Apple’s iTunes and App
`Stores. Pet. App. 68a-69a.
`Starting in 2008, PMC and Apple engaged in sev-
`eral years of discussions and meetings concerning
`PMC’s patent portfolio. Pet. App. 70a. PMC sent Ap-
`ple information about its existing patents and pending
`applications and, starting in 2010, its newly issuing
`patents. See C.A. App. 8086-8089. PMC stressed to
`Apple that its applications and patents covered the
`encryption and decryption of programming using
`transmitted decryption keys, and PMC indicated that
`
`
`
`
`
`14
`Apple’s technology practiced the claims of PMC’s pa-
`tents. See C.A. App. 8088-8089.
`The parties failed to reach a deal to license PMC’s
`patents and stopped talking in August 2014. C.A.
`App. 15045-15046. Apple, however, continued to use
`the FairPlay technology.
`2. PMC brought suit against Apple in the Eastern
`District of Texas in 2015, accusing FairPlay of infring-
`ing the ’091 patent. Pet. App. 2a-3a. As the case ap-
`proached trial in February 2017, the district court
`stayed proceedings in light of an inter partes review
`of the ’091 patent for which Apple had petitioned. Pet.
`App. 40a. The Patent Trial and Appeal Board initially
`invalidated the ’091 patent’s claims, but the Federal
`Circuit reversed as to several claims in a 2020 deci-
`sion. Pet. App. 40a
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