[00:00:00] Speaker 02:
Similarly titled Power Integrations Against Semiconductor Components, 181705.

[00:00:03] Speaker 02:
Mr. Pollack.

[00:00:08] Speaker 01:
Good morning.

[00:00:09] Speaker 01:
May it please the court?

[00:00:10] Speaker 01:
Howard Pollack for Power Integrations.

[00:00:14] Speaker 01:
This is actually the fifth appeal to this court that relates to the validity of Power Integrations 876 patent.

[00:00:21] Speaker 01:
In this argument, I want to address two issues as to claim 17 and 19 of the patent, the issue of the

[00:00:29] Speaker 01:
IPR dispute actually being moot because of this court's decision in the parallel ex parte re-exam.

[00:00:35] Speaker 02:
Do I understand correctly the mootness of the original 17 through 19 is undisputed?

[00:00:40] Speaker 01:
That's correct.

[00:00:41] Speaker 02:
And you ask that the final written decision on that be vacated.

[00:00:48] Speaker 03:
Correct.

[00:00:49] Speaker 02:
And the remaining dispute is whether we should take up the amended claims, which the board never addressed.

[00:00:56] Speaker 01:
Actually, my understanding of the dispute is whether or not this court should remand to the board for any further proceedings with regard to claims 17 to 19.

[00:01:07] Speaker 01:
Our position is no.

[00:01:08] Speaker 01:
There's no point in a remand.

[00:01:10] Speaker 01:
The board doesn't have jurisdiction over those claims because they weren't part of the petition.

[00:01:14] Speaker 01:
And even if they did, this court's decision in the ex parte re-exam would fully resolve any legal or factual issues that could be raised before the board.

[00:01:23] Speaker 01:
And so there's no point to a remand on those claims, because there's nothing further for the board to do.

[00:01:30] Speaker 02:
In the ex parte re-exam, what's it called?

[00:01:34] Speaker 02:
I guess semiconductor components would not be a party.

[00:01:37] Speaker 02:
Is that right?

[00:01:39] Speaker 01:
They were not a party until

[00:01:42] Speaker 01:
They acquired Fairchild, but they became a party while that ex parte re-exam was pending.

[00:01:49] Speaker 02:
I'm sorry.

[00:01:50] Speaker 02:
Party to the ex parte re-exam?

[00:01:53] Speaker 02:
Really?

[00:01:54] Speaker 01:
Well, in the sense that their interest in the ex parte re-exam was the same as Fairchild's initially.

[00:02:04] Speaker 01:
But you're right.

[00:02:04] Speaker 01:
They weren't actually involved in the re-exam, but they were.

[00:02:11] Speaker 01:
at that point, the entity that had filed the re-exam.

[00:02:14] Speaker 02:
Right, but I guess maybe I misunderstood.

[00:02:17] Speaker 02:
I thought you were suggesting that there would be no point in sending this matter back to the board in this IPR, put aside whether there's jurisdiction.

[00:02:27] Speaker 02:
But because, I think you said, in the appeal of the ex parte re-exam, that's in front of us now, is that right?

[00:02:39] Speaker 01:
No, no, the issue is that the issues, the legal and factual issues that were decided by this court in the context of the ex parte re-exam were specifically the interpretation of the claims and whether or not a particular piece of prior art that have other reference disclosed the properly construed claims.

[00:02:58] Speaker 01:
Those are the exact same issues.

[00:02:59] Speaker 01:
In the IPR, the same prior art was raised and the same issue of claim construction was raised.

[00:03:07] Speaker 01:
So what I'm saying is I don't believe the board having that guidance from this court as to the proper construction of the claim and what the prior art actually discloses could reach a different decision at this point on those issues, because this court's decision is legally binding, certainly as a matter of law.

[00:03:31] Speaker 01:
And there's no different factual dispute.

[00:03:38] Speaker 01:
The second issue I'd like to address is claims 14 to 16.

[00:03:44] Speaker 01:
Before we get there, can we revisit privity?

[00:03:48] Speaker 01:
I was not going to revisit privity except to point out there's two minor differences in the procedural posture of this appeal versus the one we just heard about, which is that in this appeal, the Patent Office did not intervene.

[00:04:03] Speaker 01:
And in this appeal, on didn't raise the waiver issue that it raised.

[00:04:07] Speaker 01:
in the prior appeal that was discussed.

[00:04:10] Speaker 01:
But I'm happy to answer any questions you might have.

[00:04:14] Speaker 01:
I don't think the issues are any different from what you just heard.

[00:04:17] Speaker 03:
I guess I have maybe a due process question.

[00:04:22] Speaker 03:
I know there's an argument as to whether ON here has its own independent interests in protecting itself against this patent from Fairchild.

[00:04:34] Speaker 03:
We hear that ON has its own products, and they're concerned about this patent.

[00:04:38] Speaker 03:
So they want to vindicate the interest in protecting their products

[00:04:41] Speaker 03:
and that they don't merely have a derivative interest from Fairchild.

[00:04:46] Speaker 03:
And so the question is, given that independent and distinct interest, is there some due process problem in precluding on from going forward in this proceeding, given that they never had an opportunity to participate in the district court Fairchild litigation, and now by virtue of at some point during the

[00:05:11] Speaker 03:
course of the IPR proceeding that entered into a merger here with Fairchild.

[00:05:18] Speaker 01:
So I will address that.

[00:05:20] Speaker 01:
The issue here is that there's no evidence in the record.

[00:05:23] Speaker 01:
There wasn't any evidence in the record before the board.

[00:05:25] Speaker 03:
I'm just saying assume, I'm sorry, assume for the moment that a party like ON, under these circumstances, in fact, does have its own independent and distinct interest in protecting itself from this patent.

[00:05:39] Speaker 03:
I believe that.

[00:05:41] Speaker 03:
they essentially are being deprived of their day in court or day at the PTAP.

[00:05:47] Speaker 01:
I think applications and internet time answers that.

[00:05:51] Speaker 01:
I believe the case said it doesn't actually matter whether the party who became the privy or was in privity with a precluded party has their own independent interests.

[00:06:04] Speaker 01:
That doesn't trump the fact

[00:06:06] Speaker 01:
that they're in privity with a party that should be precluded.

[00:06:10] Speaker 01:
So I think the case answers that, because we're looking here at whether it's fair for a party to come in and buy a party who had its day in court, had a full and fair opportunity to litigate.

[00:06:27] Speaker 01:
There was a final judgment rendered against them, and basically just can undo that simply by virtue of buying that company.

[00:06:35] Speaker 01:
When that interest goes on, I think that the more interesting question, and one we're not facing, is what would happen if they bought Fairchild and then divested the business of Fairchild?

[00:06:47] Speaker 01:
That was an issue in the first case.

[00:06:51] Speaker 01:
And then they no longer had the derivative interest of Fairchild, but only at that point had their own independent interest.

[00:06:57] Speaker 01:
That might be a more interesting question.

[00:06:59] Speaker 01:
But I think because they didn't, and the interest

[00:07:05] Speaker 01:
in our view, is primarily the derivative interest of fear.

[00:07:07] Speaker 01:
So that's what the board found.

[00:07:10] Speaker 01:
The fact that there might have been an independent interest should not raise the concern of due process.

[00:07:19] Speaker 01:
With regard to claims 14 and 16, we believe the board's conclusion on the legal question of obviousness was erroneous for two reasons.

[00:07:29] Speaker 01:
First, the board erred in assessing the objective indicia of non-obviousness, critically in actually not addressing this court's prior decision on those objective indicia.

[00:07:42] Speaker 01:
In fact, ignored the prior litigation entirely in determining that the objective indicia didn't apply.

[00:07:48] Speaker 01:
And also, the board applied impermissible hindsight in finding a motivation to combine two references that were on their face incompatible.

[00:08:00] Speaker 01:
I want to talk about the objective issue question.

[00:08:03] Speaker 01:
This is the nexus issue, right?

[00:08:05] Speaker 01:
Well, yes and no.

[00:08:08] Speaker 01:
The board spent all of its time talking about nexus for commercial success.

[00:08:14] Speaker 03:
Is there an identity between the claimed invention, say, what claim 14 recites and what the commercial product is?

[00:08:21] Speaker 03:
Yes, there is.

[00:08:23] Speaker 03:
There's no dispute.

[00:08:24] Speaker 03:
Is there also identity between the commercial product and what's recited in claim one?

[00:08:30] Speaker 03:
Yes, there is.

[00:08:31] Speaker 03:
So claim one and claim 14 are identical?

[00:08:33] Speaker 01:
No.

[00:08:34] Speaker 03:
Claim one and 14 are embodied by the same product.

[00:08:37] Speaker 03:
They're both embodied by the same product.

[00:08:39] Speaker 03:
I don't know what you mean by embodied, because I understand what I mean when I say identical.

[00:08:44] Speaker 03:
I don't know now what you mean when you say embodied.

[00:08:47] Speaker 01:
OK, so if you think of the scope of the two claims,

[00:08:51] Speaker 01:
They each have their own scope.

[00:08:53] Speaker 01:
The scopes overlap.

[00:08:55] Speaker 01:
And within that Venn diagram overlap is the commercial product.

[00:09:01] Speaker 01:
So the commercial product practices a circuit which is covered by claim one.

[00:09:07] Speaker 01:
That same circuit is covered by the more detailed limitations recited in claims 14 through 16.

[00:09:18] Speaker 01:
Commercial product itself, and there's evidence actually before the board, which the board didn't actually address, that not only was the product successful because of the broader invention.

[00:09:32] Speaker 03:
If a claim encompasses a million different embodiments, can you say that there is nexus to a commercial product which represents only one embodiment that's encompassed by the claimed million embodiments?

[00:09:46] Speaker 01:
Yes, I think the law says that if the commercial product embodies the claimed invention, there's a presumption of nexus.

[00:09:53] Speaker 01:
And the burden shifts to the party challenging it to show that there were some reasons other than the use of the patented invention that was responsible for the commercial success.

[00:10:05] Speaker 01:
In this case, there was no such evidence.

[00:10:07] Speaker 01:
There was no evidence by on, and there was no evidence the board cited of some reason that the tiny switch in particular was commercially successful

[00:10:16] Speaker 01:
other than the fact that they practiced the inventions of Claim 1 and Claim 14 through 16.

[00:10:24] Speaker 01:
And in fact, there are specific evidence on the narrow limitations of Claims 14 through 16, including the size of the current sources and the binary weight characteristic of the current sources from Mr. Matthews that was unrebutted that the board didn't even address.

[00:10:45] Speaker 01:
Finishing up on this, actually, before I sit down, I want to focus this Court on there was evidence in the record of other objective indicia of non-obviousness, substantial evidence of copying and praise by competitors, of long-felt need and failure of others, and departure from the conventional wisdom.

[00:11:09] Speaker 01:
All of these other objective indicia were noted by this Court

[00:11:14] Speaker 01:
in the Fairchild, what we call the Fairchild 1 case, at 7-11, Fed 3rd, 1368 and 1369.

[00:11:21] Speaker 01:
And there was additional evidence on those points in the record before the board at appendix 719 to 723, 737 to 740, and 742 to 745, which testimony from Mr. Matthews and evidence from the trial record that

[00:11:44] Speaker 01:
the Federal Circuit decision was based on, the board failed to address any of that.

[00:11:50] Speaker 01:
All it talked about was commercial success about tiny switch.

[00:11:53] Speaker 01:
We think for that reason alone, the board's decision on obviousness is legally erroneous.

[00:11:57] Speaker 01:
How can the board ignore evidence in the record of objective indicia?

[00:12:02] Speaker 01:
One, the law says they can't.

[00:12:04] Speaker 01:
If the evidence is there, you have to consider it.

[00:12:06] Speaker 01:
But two, that was evidence that this court found critical in the question of obviousness in the prior litigation.

[00:12:14] Speaker 01:
So we think for that reason alone, the board's decision on obviousness needs to be made.

[00:12:19] Speaker 02:
Thank you.

[00:12:30] Speaker 02:
Mr. Haas.

[00:12:30] Speaker 00:
Good morning, and may it please the court.

[00:12:32] Speaker 00:
Michael Hawes for Petitioner SCI.

[00:12:35] Speaker 00:
I'm certainly willing to answer any questions the court has if it has more questions, about 315B.

[00:12:40] Speaker 00:
But also, I want to turn to some of the specific issues in this appeal that are raised not only in the briefing, but by my colleague.

[00:12:48] Speaker 00:
With regard to claims 17 through 19 first, this is actually a very interesting situation.

[00:12:55] Speaker 00:
And I believe it's the first situation that has arisen in these circumstances to this court, which is where after the final written decision, after the appeal, you have a re-examination certificate that changes the underlying claims, but changes them in exactly the same way

[00:13:14] Speaker 00:
that the patent owner amended them, and the board ruled on the patentability of that amendment.

[00:13:21] Speaker 00:
It's important to note that this is on a different record than the record in the ex parte re-exam.

[00:13:26] Speaker 00:
As was noted, that's an ex parte re-exam.

[00:13:29] Speaker 00:
There was no party to that re-exam except, of course, the patentee in the patent office.

[00:13:35] Speaker 00:
And the record, especially the expert testimony, is very different.

[00:13:39] Speaker 00:
All we are asking this court to do is, under these circumstances, follow the usual practice of this court, which is where an issue that has never come up before, the change in the claims during the appeal of the IPR occurs, let the board take the first shot at determining what ought to happen in that circumstance.

[00:13:59] Speaker 00:
And I would point the court to a recent notice in the Federal Register by the Patent Trademark Office.

[00:14:05] Speaker 00:
where they address similar issues.

[00:14:07] Speaker 00:
This just happened two weeks ago, and it was published with docket number PTO-P-2019-0008.

[00:14:14] Speaker 00:
And in that notice, what the Patent Office discussed was options for amendments by patent owner through reissue or reexamination during a pending AIA trial proceeding.

[00:14:30] Speaker 00:
So it's important to note the Patent Office is looking at this very issue.

[00:14:33] Speaker 00:
In other words, what happens when you amend at the same time that an IPR is going on?

[00:14:39] Speaker 00:
And I would just point to court that on page 10 of that notice, the office points out that one of the key factors is whether amending the claim scope in one proceeding would affect the claim scope in another proceeding.

[00:14:52] Speaker 00:
Now, there are a lot of factors that the Patent Office looks at here.

[00:14:55] Speaker 00:
And the patent owner here has just said, just remand and tell them to dismiss.

[00:15:00] Speaker 00:
But we would ask that you remand it and allow the board to take into account these factors.

[00:15:05] Speaker 00:
The board may well decide that it's going to dismiss.

[00:15:08] Speaker 00:
But given the attention the Patent Office is paying to this subject, we would ask that the court remand and let the board consider it in the first instance, of course subject to this court's review on appeal.

[00:15:20] Speaker 02:
Would I be assuming correctly that if there's a 315B problem, that issue doesn't come up?

[00:15:27] Speaker 00:
Your Honor.

[00:15:28] Speaker 00:
Right?

[00:15:28] Speaker 00:
Yes, this entire IPR is subject to that.

[00:15:30] Speaker 02:
If there is not a 315B problem, do you have a procedural avenue to attack before the board the amended claims apart from a remand?

[00:15:46] Speaker 00:
Apart from a continuation of this current IPR under whatever circumstances, remand or otherwise, we could not file a new IPR.

[00:15:54] Speaker 00:
We would be barred.

[00:15:55] Speaker 00:
And that's actually one of the points that the Patent Office raises.

[00:15:59] Speaker 00:
We would be barred by what?

[00:16:00] Speaker 00:
By 315B.

[00:16:00] Speaker 00:
Because a new filing, that petition date would certainly be long after the merger.

[00:16:06] Speaker 00:
And that's one of the basic things I think needs to be brought out on the 315B.

[00:16:12] Speaker 00:
is that a company that is looking at a situation where a transaction is going to basically inherit a bar, and that company has its own products and its own interests, the position that's being taken here is that that company just loses.

[00:16:27] Speaker 00:
They never have a chance to have their own day in court.

[00:16:29] Speaker 00:
And I agree that we should not be interpreting this statute in a way that creates such a due process problem.

[00:16:36] Speaker 00:
And I would also point out that where

[00:16:38] Speaker 00:
Our counsel here for PI said, oh, that's not in the record.

[00:16:41] Speaker 00:
That's not in the record.

[00:16:42] Speaker 00:
We cited to in our brief and pointed out the accusations of patent infringement by power integrations against ONSEMI well before the merger agreement.

[00:16:53] Speaker 00:
And we pointed out and cited to that in the appendix.

[00:16:56] Speaker 00:
And there was no challenge that that was inappropriate by power integration.

[00:16:59] Speaker 00:
So it's certainly in the record on appeal that we had an independent interest, our own products being accused,

[00:17:06] Speaker 00:
And what they want is to say, well, you never get a chance to defend that with an IPR, even though Congress clearly put together the IPR system so that a party in on shoes, someone who had their own products that had been accused of infringement, could bring such an IPR.

[00:17:20] Speaker 03:
I guess you would concede, though, that if this merger had gone through before the time of filing the petition, then you would be barred.

[00:17:29] Speaker 00:
And so these policy arguments just go by the wayside.

[00:17:32] Speaker 00:
Well, these policy arguments tell you that a party doing their due diligence, which is what all parties do when they're in a merger, you look at what's the situation, and discovers this, has the opportunity to file.

[00:17:43] Speaker 00:
And because on that petition date, they are not in privity, using the Taylor versus Sturgell factors as the board did here, they have the opportunity to file and have their case heard.

[00:17:55] Speaker 00:
So I do think it makes a big difference.

[00:17:57] Speaker 03:
But if the merger had gone through before the petition filing, then you concede you're barred from having any court or any day at the board.

[00:18:06] Speaker 00:
If we had failed in our due diligence and hadn't identified the issue, yes, I think that's true.

[00:18:11] Speaker 00:
But that's true for any legal issue.

[00:18:13] Speaker 00:
Anytime you're merging, there might be a problem with the company you're merging with.

[00:18:17] Speaker 00:
So that's always a potential problem.

[00:18:20] Speaker 00:
Here, they're trying to say it doesn't matter that you found the problem.

[00:18:23] Speaker 00:
It doesn't matter.

[00:18:24] Speaker 00:
Because you can't petition, because as long as the merger happens sometime during the IPR, you're going to be retroactively barred.

[00:18:31] Speaker 00:
And we think that doesn't make sense with Congress wanting a party with its own products who've been accused of infringement to have a chance to challenge the patent.

[00:18:39] Speaker 02:
But there should be sometime during the IPR, perhaps, was asserted.

[00:18:43] Speaker 02:
But that's not the primary position.

[00:18:45] Speaker 02:
It's the moment of institution.

[00:18:47] Speaker 00:
Institution.

[00:18:48] Speaker 00:
But of course, institution was left

[00:18:50] Speaker 00:
to the Patent Office's discretion.

[00:18:52] Speaker 00:
Congress didn't say, you'll make the decision of institution six months after, or you'll make it five months after.

[00:18:59] Speaker 00:
The Patent Office actually has complete and unfettered discretion to choose when to institute.

[00:19:04] Speaker 00:
And that's another oddity with power integration's position, because you could have a board who says, well, we could rule on institution today, but if we wait till next week, it'll be barred, because by next week, this merger will have completed.

[00:19:18] Speaker 00:
That seems a very odd circumstance for Congress to set up to say that the arbitrary date of institution will be determinative on the substantive issue of whether there's a bar.

[00:19:29] Speaker 00:
It also, of course, is completely inconsistent with this court's discussion of the bar as a determination of the timeliness of the petition, which is how it was described in the Wi-Fi 1 case, the second Wi-Fi 1 case after the change in Acadies.

[00:19:45] Speaker 00:
Those factors all suggest that pinning it to that particular institution decision doesn't make any sense as a congressional choice, because all of a sudden you have this arbitrary choice of when institution decision occurs, driving the substantive question of whether there's a bar, whether the petition was timely.

[00:20:04] Speaker 00:
So for those additional reasons, I think, reading it that way and ignoring the condition

[00:20:09] Speaker 00:
And Your Honor, you pointed out that the language says, yes, you may institute.

[00:20:15] Speaker 00:
But the if, the condition, is about the petition.

[00:20:19] Speaker 00:
And that is the question when it comes to a 315 bar.

[00:20:23] Speaker 00:
The question is the if.

[00:20:25] Speaker 00:
We all know that you talk about it in the institution decision, sure.

[00:20:29] Speaker 00:
But the question is, is it a bar?

[00:20:32] Speaker 00:
And the condition, the language the statute uses to decide whether it's a bar talks about the petition.

[00:20:40] Speaker 00:
not about institution.

[00:20:42] Speaker 00:
I do want to address some of the issues that were raised on the substance of claims 14 to 16.

[00:20:49] Speaker 00:
First of all, we heard a lot about the previous appeals.

[00:20:51] Speaker 00:
The previous appeals did not include or consider the claims at issue in front of this court today.

[00:20:57] Speaker 00:
Claims 14 to 16 were not asserted in that case.

[00:21:01] Speaker 00:
There's no testimony about 14 to 16 in that case, and the record is completely different.

[00:21:06] Speaker 00:
Secondly, I would point out,

[00:21:07] Speaker 00:
that Council for Power Integrations made the assertion that the board ignored the litigation.

[00:21:13] Speaker 00:
And I would point the court to the appendix at page 14.

[00:21:17] Speaker 00:
And that's in the final written decision.

[00:21:22] Speaker 00:
On page 14 in the final written decision, the court specifically says, and this is at the bottom right under the objective considerations heading, Pat Nohner contends that multiple juries, the district courts, and the Federal Circuit have all concluded

[00:21:35] Speaker 00:
that the 876 patent is non-obvious based on evidence that others in the industry and all the different factors.

[00:21:41] Speaker 00:
The board looked directly at those previous litigations and that evidence to say that they ignored it.

[00:21:48] Speaker 00:
I mean, it's just contrary to the language in the final written decision.

[00:21:51] Speaker 00:
So what did they do?

[00:21:52] Speaker 00:
They looked at it, and they looked at the arguments made by SCI.

[00:21:56] Speaker 00:
And I would point you to the next page of the final written decision, page 15.

[00:22:01] Speaker 00:
The board pointed out that we argued, SCI, that any presumption of nexus is overcome by the fact that the patent owner previously attributed the same evidence of secondary considerations to features of claim one that are not present in claims 14 or 17.

[00:22:20] Speaker 00:
So again, they say, oh, the board didn't even talk about the presumption.

[00:22:23] Speaker 00:
The board did talk about the presumption.

[00:22:25] Speaker 00:
The board said, we recognize that the argument is made that, yeah, there's a presumption, but it's overcome.

[00:22:31] Speaker 00:
Because all these secondary considerations are being tied to specific requirements of claim one, not found in claim 14.

[00:22:38] Speaker 00:
So then the board analyzed that argument.

[00:22:40] Speaker 00:
And on the next page says, the board makes the finding, the very features patent owner relies upon to demonstrate non-obviousness of the invention recited in claim one are not features of the claims that are the subject of the challenges in this proceeding.

[00:22:55] Speaker 00:
This board looked at the presumption.

[00:22:58] Speaker 00:
But it is not an irrebuttable presumption and said, you can overcome that presumption if you can show that the secondary considerations evidence is tied to specific features that aren't in this claim.

[00:23:10] Speaker 03:
What about the other side's argument that the claim here embodies the commercial product?

[00:23:18] Speaker 03:
Just like claim one also might embody

[00:23:21] Speaker 03:
the commercial product, and under our case law, you get to have a nexus there.

[00:23:27] Speaker 00:
Well, Your Honor, so I actually agree with all that until you get to the end of it.

[00:23:31] Speaker 00:
I actually don't have the problem with the Venn diagram, the overlap in the middle.

[00:23:34] Speaker 00:
That's where the product is.

[00:23:36] Speaker 00:
But once you get to the presumption, that's not the end of the story.

[00:23:39] Speaker 00:
Under this court's law, you can rebut that presumption of nexus.

[00:23:43] Speaker 00:
And one of the ways you can do it is by showing that the secondary considerations evidence

[00:23:49] Speaker 00:
is not commensurate in scope with the claim at issue.

[00:23:54] Speaker 00:
We heard a lot of argument about the 876 patent.

[00:23:58] Speaker 00:
The 876 patent is not what's at issue here.

[00:24:00] Speaker 00:
What's at issue here are claims 14 to 16 of the 876 patent.

[00:24:05] Speaker 00:
The analysis never rebutted is that the secondary considerations evidence here is tied to the particular digital jitter requirement of claim one that isn't in claim 14.

[00:24:17] Speaker 00:
And it's in our brief, and we cite it to the specific pages, but I can give you a couple of those.

[00:24:22] Speaker 00:
But the testimony by their president, Mr. Balakrishnan, in page A734.

[00:24:29] Speaker 00:
And that's it.

[00:24:30] Speaker 00:
The page of the transcript is 957, lines one to three.

[00:24:34] Speaker 00:
The testimony of their own vice president of marketing, Mr. Matthews.

[00:24:37] Speaker 00:
That's at A469.

[00:24:39] Speaker 00:
Again, the testimony is on pages 25 and 26.

[00:24:43] Speaker 00:
And they both said it's these specific digital jitter characteristics that caused the commercial success and all the wonderful praise and the solutions of problems.

[00:24:55] Speaker 00:
Claim 1 has those elements, those digital jitter elements.

[00:24:59] Speaker 00:
Claim 14 doesn't.

[00:25:01] Speaker 00:
So the point here is that nexus is a factual issue.

[00:25:05] Speaker 02:
And do I remember right?

[00:25:08] Speaker 02:
Does the burden process or framework work to say they might get a presumption, but when you put on evidence that might point the other way, who has the ultimate burden of persuasion on the nexus?

[00:25:29] Speaker 02:
Because the way that the board wrote

[00:25:31] Speaker 02:
what pages 15 and 16 of the opinion suggests that the board was finding that the patent owner did not sufficiently prove nexus.

[00:25:41] Speaker 02:
And I guess I'm trying to understand how that fits with a presumption, assuming one exists, a demarco kind of thing.

[00:25:47] Speaker 00:
Let me hit both parts of that.

[00:25:48] Speaker 00:
First of all, I agree that on any issue of obviousness, the final burden of persuasion is on the petition.

[00:25:54] Speaker 00:
So SCI had the final burden of saying,

[00:25:57] Speaker 00:
Secondary considerations evidence is here entitled to little weight because of a lack of nexus.

[00:26:04] Speaker 00:
But I would point the court to the final written decision on page 16.

[00:26:08] Speaker 00:
And this finding is a finding that shows that we met that burden.

[00:26:12] Speaker 00:
It says, the very features Pat Nono relies upon to demonstrate non-obviousness, reciting claim one, are not features of the claims.

[00:26:20] Speaker 00:
that are subject to the challenges in this proceeding.

[00:26:22] Speaker 00:
That is not a they didn't meet their burden.

[00:26:24] Speaker 00:
That's an affirmative finding.

[00:26:26] Speaker 02:
Yeah, the next sentence is kind of they didn't meet their burden, isn't it?

[00:26:31] Speaker 02:
In view of the above, we agree that the evidence is insufficient to show an exodus.

[00:26:36] Speaker 00:
Right.

[00:26:36] Speaker 00:
And that's because they had a presumption.

[00:26:38] Speaker 00:
And then the evidence itself, we pointed out how the evidence itself showed that there wasn't commensurate in scope.

[00:26:45] Speaker 00:
The board made an affirmative finding in our favor.

[00:26:47] Speaker 00:
And then based on that said, there's not enough evidence here.

[00:26:51] Speaker 00:
And the secondary considerations are, of course, brought by the patentee.

[00:26:54] Speaker 00:
They're not brought by us.

[00:26:56] Speaker 00:
So all we needed to do, and we had the burden to do this, was to show that the nexus was rebutted.

[00:27:02] Speaker 00:
And there is language in the final written decision confirming that we showed that.

[00:27:06] Speaker 00:
And that's the language saying that these secondary considerations are tied to claim one, features that aren't found in claim 14.

[00:27:14] Speaker 00:
And that's a question of fact.

[00:27:15] Speaker 00:
And all that was needed was substantial evidence for the board to make that finding.

[00:27:19] Speaker 00:
Nexus is definitely a question of fact.

[00:27:21] Speaker 00:
And here, what we really have is, well, what about this piece of evidence?

[00:27:24] Speaker 00:
What about that piece of evidence?

[00:27:25] Speaker 00:
They're asking you to reweigh the evidence here.

[00:27:28] Speaker 00:
Nexus, question of fact, substantial evidence should be sufficient.

[00:27:32] Speaker 00:
Finally, I just want to make one more comment.

[00:27:34] Speaker 00:
And I know that I am at the end of my time.

[00:27:37] Speaker 00:
They made a comment about, well, there's all these others.

[00:27:40] Speaker 00:
If you look at their briefing, and specifically I would point the court to page 372, which was their patent owner response, they never argued claim 15 by itself individually.

[00:27:53] Speaker 00:
They now make that argument in their reply brief.

[00:27:55] Speaker 00:
That's the first time in however many years that they've said, oh, claim 15.

[00:27:59] Speaker 00:
You should look at secondary considerations for claim 15.

[00:28:01] Speaker 00:
This is the first time ever in their reply brief that's been raised.

[00:28:04] Speaker 00:
This court shouldn't consider the claim 15 specific arguments.

[00:28:08] Speaker 00:
Unless there are any further questions, sign.

[00:28:10] Speaker 00:
Thank you.

[00:28:10] Speaker 00:
Thank you, Your Honor.

[00:28:20] Speaker 01:
On the Nexus question, the board hung its hat on this digital, the quality of digital.

[00:28:27] Speaker 01:
And in the discussion we had previously,

[00:28:29] Speaker 01:
There's no finding that claim 14, 15, or 16 preclude a digital implementation.

[00:28:35] Speaker 01:
In fact, the part that no one disputes practices those claims was digital.

[00:28:42] Speaker 01:
So we have a situation here where the board is saying, well, the claim doesn't explicitly require a digital solution, but it encompasses a digital solution.

[00:28:54] Speaker 01:
the success of a digital solution somehow undercuts Nexus for the claims that are at issue here.

[00:29:01] Speaker 01:
And there's no case law that says if a product practices two claims in the same patent, that evidence of Nexus to one claim somehow precludes that same evidence applying to a different claim.

[00:29:17] Speaker 01:
That's just not the law.

[00:29:20] Speaker 01:
really inconsistent result.

[00:29:21] Speaker 03:
Well, one claim talks about digital jitter.

[00:29:24] Speaker 03:
That's claim one.

[00:29:25] Speaker 03:
Claim 14 doesn't say anything about digital jitter.

[00:29:27] Speaker 01:
Am I wrong?

[00:29:28] Speaker 01:
Actually, that's not the case.

[00:29:30] Speaker 01:
There are specific elements in claim one that the witnesses said, yeah, those are digital elements.

[00:29:36] Speaker 01:
For example, a DAC and a counter.

[00:29:38] Speaker 01:
Those elements are not recited in claim 14.

[00:29:41] Speaker 01:
But the claim talks about using current sources and switching current sources.

[00:29:49] Speaker 01:
And that embodiment was done digitally.

[00:29:54] Speaker 01:
Now, it might also not be.

[00:29:56] Speaker 01:
You don't have to do it digitally.

[00:29:57] Speaker 02:
You mean done in the marketplace by you as a company?

[00:30:01] Speaker 02:
You mean done in the marketplace by your product?

[00:30:04] Speaker 01:
Exactly.

[00:30:04] Speaker 01:
In the embodying product, the product for which the commercial success evidence applied.

[00:30:09] Speaker 01:
And including in claim 15, it goes even more detail about binary weighted current sources, which are digital.

[00:30:16] Speaker 01:
But the board never made a finding where they said these claims exclude digital technology.

[00:30:24] Speaker 01:
They just said the claims don't require it.

[00:30:27] Speaker 01:
We don't believe that that is sufficient basis legally to throw out the presumption of nexus.

[00:30:35] Speaker 01:
There's a lot of discussion on the privity issue.

[00:30:40] Speaker 01:
I do want to

[00:30:42] Speaker 01:
point to the Closter case, which was discussed earlier today at 793 Fed 2nd, 1583, on the issue of how courts deal with the timing, where it said, courts have repeatedly found privity where, after suit begins, a non-party acquires the assets of a defendant.

[00:31:04] Speaker 01:
So certainly after the complaint, privity can arise in a district court litigation.

[00:31:11] Speaker 01:
We think that would be consistent with our interpretation of the statute here, that at least as of the time of institution, you shouldn't ignore privity that has arisen up to that point.

[00:31:24] Speaker 01:
Thank you very much.

[00:31:26] Speaker 02:
The case is submitted.