[00:00:00] Speaker 01:
court.

[00:00:01] Speaker 01:
There are three main errors that the Patent Trial and Appeal Board committed in each of these combined appeals.

[00:00:06] Speaker 01:
One, the board improperly found obviousness based in part on disclosures in the prior references that are vague or uncertain.

[00:00:14] Speaker 01:
Despite the law holding that vague or uncertain disclosures are not disclosures at all for purposes of invalidity.

[00:00:20] Speaker 01:
Two, the board repeatedly relied on just the conclusory say-so of petitioners expert to support its findings.

[00:00:26] Speaker 01:
ranging from that expert's characterization of the prior art to his reasonable expectation of success to his reasons for combining the prior art.

[00:00:36] Speaker 01:
And three, when the patent owner called out petitioners' bare expert conclusions in the petition, the board allowed petitioners a do-over in their reply.

[00:00:46] Speaker 01:
But worse, the board did so without allowing the patent owner any substantive opportunity to argue why the new reply evidence was improper.

[00:00:55] Speaker 01:
Just a bare listing.

[00:00:57] Speaker 01:
Also, no opportunity to file a surreply where we could have provided rebuttal evidence to explain why the petitioner's new evidence was incorrect or any reasoned decision in which it explained why it believed that the new reply evidence was improper on an item-by-item basis.

[00:01:16] Speaker 01:
Your Honor?

[00:01:17] Speaker 05:
So I'm just wanting to follow up on the last thing.

[00:01:23] Speaker 05:
The board conclude you say the board failed to give you no notice of unfair opportunity to respond to the grounds of invalidity.

[00:01:31] Speaker 05:
So they come in and they reply and they're replying to your response to you.

[00:01:35] Speaker 01:
Yes.

[00:01:36] Speaker 05:
And you're saying and then you object to what they're saying.

[00:01:41] Speaker 01:
Yes.

[00:01:44] Speaker 05:
And we all agree, it's the board that has to evaluate whether or not you're correct that these were totally new arguments.

[00:01:51] Speaker 05:
I mean, the board can't have allowed totally new arguments, or else it would have to give you an opportunity for a certify.

[00:01:56] Speaker 05:
So I guess I'm not entirely clear on where you're saying the board erred.

[00:02:02] Speaker 05:
The board did evaluate whether or not these were new arguments, right?

[00:02:07] Speaker 05:
Yes.

[00:02:08] Speaker 05:
OK, so what's wrong?

[00:02:10] Speaker 01:
So the board's error was three-pronged.

[00:02:12] Speaker 01:
It didn't give us a substantive opportunity to argue or explain why we believed those were not proper reply arguments So this is kind of different.

[00:02:21] Speaker 05:
It's not that I mean the board evaluated it the board made an evaluation Yes, so your is your complaint.

[00:02:28] Speaker 05:
Why is your complaint a process claim?

[00:02:30] Speaker 05:
If your argument is that the board was wrong, the board clearly evaluated whether or not these were new arguments, and it concluded they weren't new arguments.

[00:02:38] Speaker 01:
Yes.

[00:02:39] Speaker 05:
You're using that as a due process argument.

[00:02:42] Speaker 01:
Yes, Your Honor.

[00:02:44] Speaker 01:
Exactly, Your Honor.

[00:02:44] Speaker 01:
I mean, there's also the de novo review of whether or not these were, in fact, new arguments or not.

[00:02:51] Speaker 01:
But in addition, we have a due process APA violation that we were not given an opportunity to

[00:02:58] Speaker 01:
provide argument as to whether or not the evidence was new or not.

[00:03:03] Speaker 01:
Then when the board issued its final written decision, it basically- You said that's de novo.

[00:03:09] Speaker 05:
I thought we were on abuse of discretion.

[00:03:11] Speaker 01:
Actually, whether or not the arguments are new or not is de novo.

[00:03:18] Speaker 01:
That was found by the board in, let me see,

[00:03:27] Speaker 01:
That was in the Inri Nuvasiv case, 841 F3D at 970, that whether or ground the board relied on was new, requiring a new opportunity to respond, is a question of law subject to de novo review.

[00:03:40] Speaker 02:
So was there any response in the final briefing?

[00:03:46] Speaker 01:
We were not given the chance for any additional briefing.

[00:03:50] Speaker 01:
We asked for a sir reply.

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That was denied.

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And so we were not allowed any opportunity to submit any rebuttal evidence, such as expert testimony that could have explained why the petitioners knew reply expert testimony was incorrect.

[00:04:07] Speaker 01:
Then, in addition, when the board issued its final written decisions, there was just a single footnote in each one of them saying, we've evaluated the challenges to the new evidence, and I'm paraphrasing, and we find them to be proper.

[00:04:19] Speaker 01:
That was it.

[00:04:20] Speaker 01:
So we had no idea why they believed that each of the items that we had challenged were proper responses or not.

[00:04:27] Speaker 01:
In their motion, in their reconsideration decision, they provide a little bit more explanation, basically just citing to the law saying,

[00:04:34] Speaker 01:
that, well, a petitioner is allowed to respond to what the patent owner said.

[00:04:38] Speaker 01:
They never addressed on an item by item basis as to why that was true for each of the challenged items of new evidence or argument.

[00:04:47] Speaker 01:
But essentially, what the board appeared to be finding is that petitioner basically had conclusory statements.

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For example, in one instance, their expert said that Milbrandt's reference to sub-frequency is the same thing as the claimed sub-channel, period.

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That was all he said.

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We challenged that as being merely conclusory.

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But then, in addition, we came back and said, on top of that, here are a bunch of technical reasons from our expert as to why that conclusory statement is wrong.

[00:05:17] Speaker 01:
So the board appeared.

[00:05:19] Speaker 02:
That was in the argument that you stated what your expert had said.

[00:05:23] Speaker 01:
Yes.

[00:05:23] Speaker 02:
It was contrary.

[00:05:24] Speaker 01:
Yes, Your Honor.

[00:05:25] Speaker 01:
OK.

[00:05:25] Speaker 01:
And so the board is either apparently finding that once a patent owner says you have no evidence, that it is then a proper

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reply to then provide that evidence for the first time on reply, even though that the patent owner would then have no chance to rebut it at that point.

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Or the board seems to be suggesting that there's some sort of catch-22 decision, that if a patent owner chooses to both say, petitioner, you have no evidence, and by the way, here is some of our rebuttal evidence, that that somehow opens the door for the patent owner to then basically get a do-over on reply.

[00:06:02] Speaker 01:
Now, the Federal Circuit, in the Intelligent Biosystems case, held that the evidence necessary to support patentability has to be in the petition.

[00:06:10] Speaker 01:
And there's a reason for this, because until recently, the board was not allowing sir replies.

[00:06:15] Speaker 05:
Yeah, but all the arguments and everything that, I mean, you get to respond and they get to respond to you.

[00:06:20] Speaker 05:
So it can't be.

[00:06:22] Speaker 05:
that everything, the petitioner's only opportunity to speak at all on any of these issues is in the petition?

[00:06:29] Speaker 01:
No, Your Honor.

[00:06:30] Speaker 01:
Yes, that is correct.

[00:06:31] Speaker 01:
But at the same time, Your Honor, the petitioner cannot be making its prima facie case for the first time on reply, particularly if it's relying on new evidence and new arguments that we then don't get a chance to revoke.

[00:06:43] Speaker 01:
For example, the argument on sub-frequency versus sub-channel.

[00:06:48] Speaker 01:
That is something that petitioners recognize they needed to prove.

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in the petition.

[00:06:53] Speaker 01:
And so they had their expert say that those two things are the same, but that's all he did.

[00:06:59] Speaker 01:
They're the same, period.

[00:07:01] Speaker 01:
And so that is something that they needed to prove for their prima facie unpatentability case.

[00:07:07] Speaker 05:
OK, so these are my notes from reading your briefs.

[00:07:12] Speaker 05:
But what the board relied on on that particular issue on sub-frequencies and sub-channels is a disclosure in Milbrandt.

[00:07:21] Speaker 05:
That must have been

[00:07:22] Speaker 05:
in the petition or in this case somewhere.

[00:07:24] Speaker 05:
You're not arguing that was new argument.

[00:07:26] Speaker 04:
No, Your Honor.

[00:07:27] Speaker 05:
OK, so that's one of the things they relied on.

[00:07:30] Speaker 05:
In addition, they relied on, I guess, their expert, Dr. Kai, annotation of a figure showing, et cetera.

[00:07:39] Speaker 05:
You claiming that was new argument or new evidence?

[00:07:41] Speaker 01:
The annotated figure, yes.

[00:07:43] Speaker 01:
In the petition, the only thing that they relied on was so the issue here is Milbrandt, so our claims require

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measuring certain parameters on a sub-frequency basis.

[00:07:55] Speaker 01:
There's another claim that requires measuring certain parameters during showtime.

[00:08:00] Speaker 01:
Milbrant does not disclose either of those two concepts.

[00:08:03] Speaker 01:
It does not disclose measuring any power parameters on a sub-channel basis.

[00:08:11] Speaker 01:
It also does not disclose anything about showtime.

[00:08:14] Speaker 01:
Instead, it uses other words.

[00:08:17] Speaker 01:
It says that it doesn't.

[00:08:18] Speaker 05:
No, and the board didn't miss that.

[00:08:20] Speaker 05:
The board addressed that and suggesting that in Millbrandt, it was clear from their reading of Millbrandt that the use of sub-frequency, even though it's a different word, it's the same disclosure.

[00:08:33] Speaker 01:
Yes, Your Honor.

[00:08:34] Speaker 01:
And therein lies the problem is, what was the board's basis for finding that?

[00:08:37] Speaker 01:
Literally, the only basis they had for finding that was the conclusory say-so of petitioner's expert.

[00:08:42] Speaker 01:
And petitioner's expert did not provide even an explanation for why he believed that to be so.

[00:08:48] Speaker 01:
He just said, they are the same period in the petition.

[00:08:51] Speaker 01:
On reply, he came back and provided more explanation for why he believed that show time and during operation are the same thing.

[00:09:00] Speaker 01:
During operation is what Milbrant referred to.

[00:09:02] Speaker 01:
Provided more.

[00:09:03] Speaker 05:
I'm looking at the board's opinion, and, Grant, it's lately.

[00:09:07] Speaker 05:
I'm already at Appendix 93.

[00:09:09] Speaker 05:
But it seems to be not just discussing the expert's testimony, but it's talking about Milbrant itself, right?

[00:09:17] Speaker 05:
There's a lot of discussion of the disclosure of Milbrant outside of what the expert said, right?

[00:09:22] Speaker 01:
Yes, your honor, but simply saying, recognizing that Milbrandt uses the words sub-frequency is not itself evidence of anything.

[00:09:30] Speaker 01:
Milbrandt uses the word sub-frequency, so the issue is, is sub-frequency the same thing as sub-channel?

[00:09:34] Speaker 01:
Milbrandt itself, the only thing that Milbrandt says, in fact, points to the fact that they are not the same.

[00:09:42] Speaker 01:
For example, in one instance, Milbrandt specifically uses the word sub-frequency, and in an instance where we know for a fact it cannot be referring to a sub-channel.

[00:09:51] Speaker 01:
Now, the board brushed that away by saying, well, Millbrant must have been using the word subfrequency differently in different situations.

[00:09:59] Speaker 01:
Again, just citing to where Millbrant uses the word subfrequency.

[00:10:02] Speaker 01:
But that is not evidence of what Millbrant meant by that word subfrequency, whether Millbrant was using that word to mean the same thing as the same claim subchannel.

[00:10:15] Speaker 01:
That our challenge is the fact that the board's only basis

[00:10:19] Speaker 01:
for its decision is citing to what Milbrandt said, which again is not what the claimed invention is, and then citing to the petitioner's expert proclaiming that they're the same thing.

[00:10:30] Speaker 03:
So they didn't just have the expert in front of them.

[00:10:32] Speaker 03:
They also had Milbrandt in front of them, right?

[00:10:36] Speaker 03:
Yes.

[00:10:36] Speaker 03:
So why do you act as though the PTO made this decision based on a conclusory statement by the expert when they actually had the reference in front of them, and the reference has language in it

[00:10:47] Speaker 03:
arguably can support their conclusion.

[00:10:49] Speaker 03:
So why is that, among other things, a due process problem?

[00:10:55] Speaker 01:
Well, we're not proclaiming due process on that.

[00:10:57] Speaker 01:
There the issue is that there's no substantial evidence to support the board's finding.

[00:11:00] Speaker 03:
Well, there's a sentence in column 11 that says each sub-frequency is an independent channel and supports transmission of its own stream of data signals.

[00:11:08] Speaker 03:
Why doesn't that, taken out of context, fully support what the board concluded?

[00:11:12] Speaker 01:
Exactly, but there's still a dispute as to what does that mean.

[00:11:15] Speaker 03:
But here's your problem.

[00:11:17] Speaker 03:
I'm just going to tell you, I'm just going to be completely honest, because I wear everything on my sleeve all the time.

[00:11:21] Speaker 03:
That's the way I am.

[00:11:23] Speaker 03:
I would have found this case in your favor if I were the fact finder.

[00:11:27] Speaker 03:
I think Milbrant is awfully confusing about what it's using these words to mean.

[00:11:32] Speaker 03:
But my standard of review is substantial evidence.

[00:11:34] Speaker 03:
There are sentences in this patent that support what the PTO concluded about what Milbrant was disclosing on channel and sub-frequency.

[00:11:44] Speaker 03:
I'll be honest, I'm an electrical engineer.

[00:11:46] Speaker 03:
I have trouble understanding what they mean.

[00:11:48] Speaker 03:
I think they're maybe even internally inconsistent within the patent, but at best confusing about what they mean.

[00:11:54] Speaker 03:
So if I am not reviewing it de novo, which I'm not, because this is what does a prior art reference disclose, I'm reviewing it for substantial evidence, and there are sentences which, standing alone, seem to support exactly what the PTO concluded, even though there's other sentences that don't, how in the world do I find it in your favor?

[00:12:11] Speaker 03:
I don't.

[00:12:11] Speaker 03:
I can't.

[00:12:12] Speaker 03:
That's where we are.

[00:12:13] Speaker 03:
That's where I am.

[00:12:14] Speaker 01:
Well, Your Honor, with respect to that instance, it doesn't say that the sub-frequencies are sub-channels.

[00:12:19] Speaker 01:
It says that each sub-frequency is an independent channel.

[00:12:22] Speaker 01:
So the issue is, what does that mean?

[00:12:23] Speaker 01:
Either the board was relying on its own expertise, which was improper, or the board was relying... No, I disagree with you.

[00:12:29] Speaker 03:
I don't think the board relying on its own expertise is improper.

[00:12:32] Speaker 03:
They're interpreting what does this disclose to a artisan skilled in the field.

[00:12:37] Speaker 03:
So they have to bring a little bit of that to the table.

[00:12:40] Speaker 03:
They don't have to.

[00:12:41] Speaker 03:
There are cases we get where there is no expert testimony.

[00:12:44] Speaker 03:
Are you saying the board is improper for looking at the reference and telling you what it would teach to a skilled artisan in the field, simply if there's no expert present giving testimony on it?

[00:12:53] Speaker 01:
No, Your Honor, because, for example, if the prior reference expressly disclosed the claim limitation, that's something that can be easily determined.

[00:12:59] Speaker 01:
Here, it does not expressly disclose subchannels.

[00:13:02] Speaker 01:
It does use the word subchannels in other instances,

[00:13:06] Speaker 01:
that are different than sub-frequency, just referring to transmitting data on a sub-channel basis.

[00:13:11] Speaker 01:
And if anything, that, again, also seems to suggest sub-frequency and sub-channel are two different things.

[00:13:17] Speaker 01:
But here, it's an issue.

[00:13:18] Speaker 01:
It's more like coherency.

[00:13:20] Speaker 03:
And if you're like- What about column 10 at the bottom?

[00:13:22] Speaker 03:
Let's start line 58 and go through roughly line 65.

[00:13:26] Speaker 03:
That also seems to support the board's determination about what these things mean.

[00:13:35] Speaker 01:
Again, I think there's no dispute that Milbrant does not use the word sub-channel in terms of discussing what's being measured.

[00:13:45] Speaker 01:
It uses the word sub-frequency.

[00:13:47] Speaker 01:
And so the board pointed to sentences where Milbrant is using the word sub-frequency.

[00:13:52] Speaker 01:
And they're saying, we take that to mean that, as a technological matter, he's referring to sub-channels.

[00:13:59] Speaker 03:
But again, it's just... No, but Milvance said subbands or channels.

[00:14:06] Speaker 03:
I mean, how much of a leap is it for the board to say that that means what they think it means?

[00:14:11] Speaker 03:
I mean, not much of a leap.

[00:14:12] Speaker 03:
And you can't win on that argument on a substantial evidence review.

[00:14:17] Speaker 01:
Well, again, then the issue is where is the evidence that that that that reference to sub channels or bands is the same thing as the claims.

[00:14:24] Speaker 03:
Where is the evidence?

[00:14:25] Speaker 03:
It is the evidence.

[00:14:27] Speaker 03:
I mean, the reference is the reference is a piece of evidence and the board is telling me what that piece of evidence discloses and I review it for substantial evidence.

[00:14:35] Speaker 03:
So even if I might not have construed it the same way they did,

[00:14:38] Speaker 03:
At the outset, this isn't an overview.

[00:14:41] Speaker 01:
All right.

[00:14:42] Speaker 01:
Well, I think a clear example, Your Honor, might be the during showtime limitation.

[00:14:49] Speaker 01:
There the issue was Milbrandt only discloses measuring certain parameters during operation.

[00:14:55] Speaker 01:
The issue is, is that during showtime, as claimed in our patent?

[00:15:00] Speaker 01:
There, again, it started with petitioner's expert just proclaiming that during showtime

[00:15:07] Speaker 01:
was the same thing as the claimed, I'm sorry, during operation was the same thing as the claimed during showtime.

[00:15:14] Speaker 01:
But Milbrant never says that.

[00:15:16] Speaker 01:
In one instance, we know for a fact that when he says during operation, he is not referring to during showtime because he specifically is referring to modem training.

[00:15:25] Speaker 01:
The board said, okay, in that instance, Milbrant is ambiguous.

[00:15:29] Speaker 01:
But then how did the board find that the other instances where Milbrant said during operation,

[00:15:34] Speaker 01:
that that was during Showtime.

[00:15:37] Speaker 05:
You're way beyond your time, so I want to reserve some rebuttal for you, but can I just ask you one quick question that goes back to where exactly I started, which was on the standard of review for what the board did.

[00:15:47] Speaker 05:
Yes, Your Honor.

[00:15:47] Speaker 05:
At page 60 of Bluebrief, you talk about the board's, the standard, the only standard that I can find that you articulate from Blue is the abuse of, is the board abused its discretion and how it addressed and ruled on patent owners' objections.

[00:16:04] Speaker 05:
I see you cited in Renovative in gray, but not in blue, as far as I can tell.

[00:16:12] Speaker 05:
And you were using an abrasive discretion standard in your arguments in blue.

[00:16:15] Speaker 05:
Am I right about that?

[00:16:19] Speaker 01:
So we did cite, too, in Renovative.

[00:16:22] Speaker 01:
So the issue of whether or not you're in blue.

[00:16:25] Speaker 01:
Let me see where Renovative is.

[00:16:27] Speaker 05:
It's not listed in the table of authorities in blue, unless I'm missing something.

[00:16:41] Speaker 05:
Certainly, it's in gray.

[00:16:43] Speaker 01:
Yes, Your Honor.

[00:16:45] Speaker 01:
It may not be cited in the blue brief.

[00:16:47] Speaker 05:
And the sentence I read from 60 is accurate, right, that you said the board abused its discretion.

[00:16:54] Speaker 01:
It did abuse its discretion with respect to the fact findings.

[00:16:57] Speaker 01:
And it should be denoted review with respect to whether or not new arguments were improperly allowed or with respect to the due process violations.

[00:17:05] Speaker 01:
Thank you, Your Honor.

[00:17:06] Speaker 05:
We'll restore a little rebuttal time.

[00:17:07] Speaker 05:
Let's hear from the other side.

[00:17:08] Speaker 05:
Thank you.

[00:17:10] Speaker 05:
Mr. Foster.

[00:17:22] Speaker 00:
Good morning.

[00:17:22] Speaker 00:
May it please the court, Theo Foster for Appellees.

[00:17:26] Speaker 00:
I'd like to begin with the discussion of due process and pick that up.

[00:17:31] Speaker 00:
Even if the proper standard of review was de novo, the appellant here has not identified any particular argument or piece of evidence that they believe was improperly considered by the board.

[00:17:48] Speaker 00:
I would note, for example, that as they mentioned,

[00:17:52] Speaker 00:
The board allowed TQ Delta to provide a listing of all of the arguments in the petitioner's reply that it believed were improper.

[00:18:03] Speaker 05:
I'm confused about the word argument, because it can be used in different contexts.

[00:18:10] Speaker 05:
My understanding is it did not allow them to make arguments, but it did allow them to list what they thought was improper or outside of the petition rights.

[00:18:22] Speaker 05:
So are those two separate?

[00:18:25] Speaker 05:
Two different things.

[00:18:26] Speaker 00:
Judge Prost, you are absolutely correct.

[00:18:27] Speaker 00:
They were allowed to submit a listing.

[00:18:30] Speaker 00:
identifying portions of the petitioner's reply that they believed were improper.

[00:18:35] Speaker 00:
And they did that.

[00:18:35] Speaker 00:
And they did that.

[00:18:37] Speaker 00:
That document is not in the joint appendix.

[00:18:41] Speaker 00:
They have not relied on any of the arguments that they previously identified, or the portions of the petitioner's reply.

[00:18:48] Speaker 05:
Well, what do you understand their argument to be?

[00:18:50] Speaker 05:
That the listing was insufficient, and they should have been allowed, again, I'm going to use the second argument, to make arguments with respect to those items, right?

[00:19:00] Speaker 00:
Yes, as I understand their argument, they're arguing that essentially a patent owner is entitled to a surreply in all instances, that it was improper for the board to consider the petitioner's reply at all.

[00:19:19] Speaker 05:
So what standard does the board have?

[00:19:22] Speaker 05:
Does it have to determine that, no, these weren't new arguments?

[00:19:28] Speaker 05:
because they were already included in the petition.

[00:19:31] Speaker 05:
So is that the standard that we're reviewing?

[00:19:33] Speaker 05:
Were these in the petition?

[00:19:34] Speaker 05:
I'm just not clear on what the standard that the board ought to be using is.

[00:19:37] Speaker 00:
My understanding of the standard that the board uses, and this relates back to the rules governing IPR, is that the petitioner's reply is allowed to present argument and evidence in response to points raised by the patent owner's response.

[00:19:54] Speaker 00:
And so as long as

[00:19:55] Speaker 00:
the petitioner is responding to arguments and issues and evidence, but forward by the patent owner, then that is proper.

[00:20:03] Speaker 00:
And so this is why a petitioner is not locked into statements in their petition in the sense that if they say one word that's different than what was in the petition, that they're out of line.

[00:20:18] Speaker 00:
That can't be the standard, because it would render the petitioner's reply just kind of a ridiculous filing.

[00:20:24] Speaker 05:
But the standard is that if there's something new that the petitioner comes up with, new and different, I guess, then there is an opportunity for a cert reply.

[00:20:34] Speaker 05:
Or alternatively, they can't put anything new and different.

[00:20:38] Speaker 00:
That's correct.

[00:20:39] Speaker 00:
And it's the question of being new in the sense of a different prior combination.

[00:20:46] Speaker 00:
If the response to, well, you didn't like the obviousness combination that was in the petition, here's a new prior reference.

[00:20:53] Speaker 00:
That's responsive in some sense, but that's clearly new and is improper.

[00:20:57] Speaker 00:
And so that's where the dividing line is.

[00:21:00] Speaker 03:
Here, the obvious is- No, that's not what the dividing line is.

[00:21:02] Speaker 03:
The dividing line, a new argument can be a different embodiment within the same reference.

[00:21:06] Speaker 03:
If you only refer to pages two through five and a particular embodiment within a reference as disclosing an element,

[00:21:12] Speaker 03:
And it's concluded that element's not disclosed there.

[00:21:14] Speaker 03:
The petitioner can't in reply say, OK, well, then look at page 57 to 58, which is a whole different embodiment that one does.

[00:21:20] Speaker 03:
That would be the same reference, but that would still be the kind of new argument that shouldn't be permitted or should at least permit, sir, reply.

[00:21:28] Speaker 00:
Yes, that's evasive.

[00:21:30] Speaker 00:
Your example, Judge Moore, would be?

[00:21:32] Speaker 03:
Well, it's the case I've already decided.

[00:21:34] Speaker 03:
So yes, you didn't describe the line correctly, because the line has been drawn further than you just drew it.

[00:21:41] Speaker 00:
Yes, Judge Moore, a new embodiment being raised, which then is really more of a new ground, even if it is the same reference, would be an improper new argument.

[00:21:54] Speaker 00:
Here, I don't understand the appellant as identifying the petitioners as having done anything like that.

[00:22:02] Speaker 00:
We're relying on the same text from Milbrant in column 10 that we did in the petition with respect to showing that sub-frequencies are

[00:22:11] Speaker 00:
are properly understood to be sub-channels.

[00:22:14] Speaker 02:
It's really a question of due process, is it not?

[00:22:19] Speaker 02:
And to assure, and for us to assure, that the board here, they're supposed to substitute for the district court not to bring a fresh bureaucratic layer of rigidity

[00:22:31] Speaker 02:
So when there is a question of whether there are or aren't new arguments, shouldn't there be an obligation on the board to see that all arguments are brought forth and considered so that the final decision has the substance that this entire procedure is supposed to impart?

[00:22:54] Speaker 00:
Yes, Judge Newman, I agree.

[00:22:56] Speaker 00:
And this court has said that one of the purposes of the trial portion of the proceeding is for the admission of evidence and the development of argument.

[00:23:07] Speaker 00:
The institution phase has initial arguments put forward by each party.

[00:23:11] Speaker 00:
But then there's the trial phase, developing the evidence, developing the arguments, and bringing them to a point at the oral hearing before the board.

[00:23:18] Speaker 00:
And so you're correct that the final written decision is supposed to

[00:23:24] Speaker 00:
look back across all of the evidence put forward and the arguments put forward by the parties and make a judgment based on that.

[00:23:32] Speaker 02:
So you're satisfied as to whose obligation it is in this give and take before the board to make sure that there are no inappropriate barriers imposed by the agency when their procedure is supposed to be more open, if anything, than that in a district court?

[00:23:54] Speaker 00:
Well, the board has many things that it has to consider.

[00:23:59] Speaker 00:
Among them is the statutory mandate for issuing its final written decision in one year.

[00:24:05] Speaker 00:
And so that is a limitation on its ability to be flexible.

[00:24:10] Speaker 00:
And so whereas a district court could move deadlines or extend a case, the board doesn't have that kind of flexibility.

[00:24:19] Speaker 00:
So it has to have reasonable rules in place

[00:24:22] Speaker 00:
to ensure that it can meet those deadlines.

[00:24:24] Speaker 00:
And I think the board has done that with its rules.

[00:24:28] Speaker 00:
And we've seen the board adapting them over time.

[00:24:32] Speaker 00:
But the suggestion that the appellants are bringing in this case, that every case decided before there was a surreply by the patent owner allowed as of right, that every case decided before that was

[00:24:48] Speaker 00:
in violation of the patent owner's due process rights.

[00:24:51] Speaker 05:
No, no, no.

[00:24:52] Speaker 05:
That's a little extreme.

[00:24:53] Speaker 05:
They're not exactly saying every case.

[00:24:55] Speaker 05:
They're talking about these circumstances, and they're making an argument.

[00:24:57] Speaker 05:
We may reject the argument, but their argument isn't in every case they have it as a matter of right.

[00:25:04] Speaker 05:
It's based on the circumstances here, and they're making an argument that these were new arguments, so they should have had an opportunity to present argument that they were new arguments.

[00:25:13] Speaker 05:
So it's a little overstatement, right?

[00:25:17] Speaker 00:
I may have read their brief as being a little bit more aggressive with their position.

[00:25:21] Speaker 00:
But certainly, as far as today's proceedings is concerned, limiting it to the facts of this case is appropriate.

[00:25:30] Speaker 05:
Why don't you turn to a little about what the reference, there's some discussion with your friend on Milbrandt.

[00:25:36] Speaker 00:
Yes.

[00:25:37] Speaker 00:
So Milbrandt and Mr. Scharf raised two issues with that.

[00:25:43] Speaker 00:
I'll take up the during showtime limitation first.

[00:25:48] Speaker 00:
The board cited and relied on Milbrant's teaching that it gathers measurements of the subscriber line performance, quote, while providing data services to subscribers, close quote.

[00:26:02] Speaker 00:
That's from Milbrant in column 10 of some of the lines, Judge Moore, that you highlighted earlier.

[00:26:09] Speaker 00:
And Milbrant explains what it means by data services.

[00:26:12] Speaker 00:
That's in column 9.

[00:26:13] Speaker 00:
Data services include things like video on demand, multimedia applications, and providing internet access.

[00:26:20] Speaker 00:
That is the substantive end user data communications that occur when you have a DSL modem engaging in normal communications.

[00:26:31] Speaker 00:
That is show time.

[00:26:33] Speaker 00:
I don't think there's any argument that DSL modems provided video on demand service during initialization.

[00:26:42] Speaker 00:
What Millbrandt is teaching here by providing data services and at the same time taking those line measurements and that integration is something that it specifically touts as an advantage.

[00:26:53] Speaker 00:
That's in the sentence bridging columns six and seven.

[00:26:57] Speaker 00:
Millbrandt is describing taking these line measurements during the normal communications of a DSL receiver, which is the board's construction of during showtime that neither party is challenging.

[00:27:11] Speaker 00:
regarding the other aspect of Milbrant, and judge more with respect to sub-frequency, that you indicated at least some concerns over what the board did, but on substantial evidence review don't see a way to find in favor of the appellant here.

[00:27:33] Speaker 00:
I think for the appellees, Milbrant's disclosure is sufficiently clear.

[00:27:39] Speaker 00:
the way it's describing each sub-frequency as an independent channel and saying that there are many such individual channels.

[00:27:47] Speaker 00:
And each of those uses quadrature amplitude modulation to transmit data.

[00:27:52] Speaker 00:
That's quite consistent with what we're looking at in the 412 and the 956 patents.

[00:27:59] Speaker 00:
Quadrature amplitude modulation on a per sub-channel basis is actually in the claims.

[00:28:03] Speaker 00:
So that's the disclosure

[00:28:05] Speaker 00:
of using quadrature amplitude modulation on each channel or sub-frequency is consistent with that plain language.

[00:28:11] Speaker 00:
And then also, if we look at, for example, the background of the 956 or the 412 pattern, where it describes how this DSL technology is working and put some further information on what it means by a sub-channel, it's describing modulating

[00:28:31] Speaker 00:
data onto a multiplicity of discrete frequency carriers, which are then summed together.

[00:28:37] Speaker 00:
And those carriers form discrete, non-overlapping communication sub-channels of limited bandwidth.

[00:28:44] Speaker 00:
And that's in the first column in the background section of the patents.

[00:28:49] Speaker 00:
So the discussion here in the background of a sub-channel being an

[00:28:54] Speaker 00:
a discrete communication device that's independently modulated is entirely consistent with Milbrandt's description of a sub-frequency, which is modulated using quadrature amplitude modulation and which is an independent and supports transmission of its own data stream.

[00:29:14] Speaker 00:
So I believe the evidence is there from Milbrandt itself showing the consistency between sub-frequency and sub-channel.

[00:29:24] Speaker 00:
Judge more with respect to your concern about Millbrandt's use of the word sub-frequency and whether other minds might disagree as to its clarity.

[00:29:36] Speaker 00:
I would note that we have testimony from three experts in this case and in this record.

[00:29:42] Speaker 00:
Dr. Kiayi from Petitioners and Dr. Crisan and Dr. Short for TQ Delta.

[00:29:50] Speaker 00:
And all three of them testified that in this technology space,

[00:29:53] Speaker 00:
there's some looseness, if you will, with respect to terminology, and that there are a variety of words that get used to identify these individual carriers of the multi-carrier communication link.

[00:30:07] Speaker 00:
The words carrier, subcarrier, channel, subchannel, subband, frequency, that all of these are words that are used to describe that same concept.

[00:30:20] Speaker 00:
And that although in particular instances,

[00:30:23] Speaker 00:
they might have slightly different meaning.

[00:30:27] Speaker 00:
They frequently are used interchangeably.

[00:30:30] Speaker 00:
And so I think it's not surprising to see Millbrandt is using another term here, which it analogizes to subband and channel, which are words that the three experts all agreed are interchangeable with subchannel.

[00:30:45] Speaker 00:
I don't think it's surprising to see yet another word being used by an inventor in describing their invention here, Millbrandt.

[00:30:53] Speaker 00:
to describe this very same concept.

[00:30:58] Speaker 00:
Are there no further questions?

[00:31:00] Speaker 00:
Thank you.

[00:31:05] Speaker 05:
We'll restore two minutes of rebates.

[00:31:07] Speaker 01:
Thank you, Your Honors.

[00:31:09] Speaker 01:
Your Honors, petitioners' oral argument has evidenced that they're not relying just on new arguments that were presented for the first time in their reply brief in the IPR, but also new arguments that they've raised for the first time on appeal.

[00:31:22] Speaker 01:
For example, petitioners discussed this argument as to why Milbrandt supposedly discloses during showtime.

[00:31:29] Speaker 01:
They cited to column 10 of Milbrandt where he discusses while providing data services.

[00:31:34] Speaker 01:
That was not an argument that was raised below in the IPRs.

[00:31:38] Speaker 01:
And they still have no evidence on that.

[00:31:40] Speaker 01:
They have only attorney argument that that statement in Milbrandt somehow means showtime when there's no evidence that providing data services cannot also mean initialization.

[00:31:52] Speaker 01:
Initialization of a modem is a data service.

[00:31:55] Speaker 01:
They also raise a new argument with respect to Milbrant's disclosure of subchannels.

[00:31:59] Speaker 01:
A new argument for the first time on appeal that because Milbrant discloses the concept of modulating data for transmitting data on a subchannel basis, that he must have meant the same thing when he was discussing how he measures test or diagnostic parameters.

[00:32:18] Speaker 01:
Understanding how you measure

[00:32:20] Speaker 01:
a parameter does not have to be the same as how you are transmitting data.

[00:32:24] Speaker 01:
That was another new argument on reply, relying just on attorney argument.

[00:32:29] Speaker 01:
Then there are a couple of strawman arguments, kind of putting some words in our mouth.

[00:32:36] Speaker 03:
They argue that we believe- Just out of curiosity, did you argue that they waived all of these arguments they made in the red brief by not raising them below in your gray brief?

[00:32:45] Speaker 01:
We did.

[00:32:46] Speaker 01:
Yes, Your Honor.

[00:32:47] Speaker 01:
In that, we specifically-

[00:32:51] Speaker 01:
believe it was in a footnote here.

[00:33:14] Speaker 03:
Page seven footnote five isn't an argument that they waived something.

[00:33:21] Speaker 03:
Page seven footnote five is an argument suggesting that the board erred to the extent it found that modem training was used in an idiosyncratic manner.

[00:33:30] Speaker 01:
Yes, Your Honor.

[00:33:32] Speaker 01:
It's page eight.

[00:33:33] Speaker 01:
It's where it says sixth, no petitioners, new arguments made for the first time in the reply.

[00:33:37] Speaker 01:
This is where we address the providing data services is addressed near the bottom of that paragraph.

[00:33:44] Speaker 05:
I thought I was looking at the footnotes.

[00:33:46] Speaker 01:
I'm sorry, Your Honor.

[00:33:47] Speaker 01:
It was in the body of the brief.

[00:33:50] Speaker 01:
Page eight of our reply brief, the paragraph beginning sixth, none of the petitioners' new arguments made for the first time in their appellate response.

[00:33:58] Speaker 01:
That was where we addressed the new arguments that they made.

[00:34:03] Speaker 03:
parenthesied comment made for the first time in their appellate response should have clued us in that you were suggesting those arguments should be deemed by this court to be waived as a matter of law for not having been raised below?

[00:34:15] Speaker 01:
Yes, Your Honor.

[00:34:15] Speaker 01:
I apologize if we didn't make that clear.

[00:34:18] Speaker 03:
Because you can waive waiver.

[00:34:20] Speaker 03:
You know that, right?

[00:34:20] Speaker 03:
Like you can waive waiver.

[00:34:21] Speaker 01:
Yes, Your Honor.

[00:34:22] Speaker 01:
Well, and then the second argument, their new argument with respect to the sub-channel that it's based on Milbrandt's disclosure of how data is modulated, that was an argument that they did not even make in their briefs.

[00:34:33] Speaker 01:
That was an argument that I heard for the first time here at Oral Argument.

[00:34:37] Speaker 01:
And so that is also an improper new argument.

[00:34:41] Speaker 05:
You're beyond your time.

[00:34:43] Speaker 05:
Thank you, Your Honor.

[00:34:44] Speaker 05:
Thank you.

[00:34:45] Speaker 05:
We thank both sides in the cases submitted.