[00:00:36] Speaker 01:
Our next case is General Electric versus United Technologies, 2019-13-19.

[00:00:41] Speaker 01:
I guess we're not quite clear yet.

[00:01:01] Speaker 01:
Mr. Lee, we're ready when you are.

[00:01:05] Speaker 04:
Thank you, Your Honor.

[00:01:07] Speaker 04:
May it please the Court, my name is Bill Lee, and together with my partner, Lauren Fletcher, we represent General Electric.

[00:01:14] Speaker 04:
Let me turn immediately to the standing issue directly.

[00:01:17] Speaker 02:
There are five- Can I just interrupt you?

[00:01:20] Speaker 02:
Sure.

[00:01:21] Speaker 02:
What additional evidence that's more complete in this case, in this declaration, do you have than the last time around, where at least the majority of the panel found it insufficient?

[00:01:32] Speaker 04:
That is precisely where I was going to go, Your Honor.

[00:01:34] Speaker 04:
There are five facts that are in this record that were not in the record in the prior case, all of which derive from the fact that, unlike the last case, he is currently developing an engine that UTC is likely to accuse of infringement.

[00:01:51] Speaker 04:
And here are the five facts.

[00:01:53] Speaker 04:
The first, all geared turbofan engines have a core nasal, a fan nasal, a low-pressure spool containing a turbine and a compressor, a high-pressure spool containing a turbine and a compressor, and a fan.

[00:02:05] Speaker 04:
These are all the DiTomasso Declaration and Supplemental Declaration, Your Honor.

[00:02:10] Speaker 04:
Secondly, commercially competitive engines for the relevant market for the past several years have had certain parameters which are outlined in the Supplemental DiTomasso Declaration paragraph four.

[00:02:23] Speaker 04:
Third, there is an engine currently in development at General Electric.

[00:02:28] Speaker 04:
It is described in the confidential portions of paragraph 24 and paragraph 5.

[00:02:34] Speaker 04:
That is the most fundamental distinction from the prior appeal where there was no

[00:02:40] Speaker 04:
There was no engine in design that could potentially implicate the patent.

[00:02:45] Speaker 02:
The prior failure declaration, I think, essentially said, this is a competitive field.

[00:02:51] Speaker 02:
We're likely to design.

[00:02:52] Speaker 02:
We may want to design, but we didn't have specific plans.

[00:02:56] Speaker 02:
And now you're saying.

[00:02:57] Speaker 02:
We have specific plans to design an engine that is likely to be accused of infringement.

[00:03:02] Speaker 04:
That's exactly right.

[00:03:03] Speaker 04:
And, Your Honor, the fourth and fifth facts go precisely to that.

[00:03:07] Speaker 04:
What the record here demonstrates is that GE plans to design a competitive engine for the marketplace and its current design.

[00:03:16] Speaker 04:
The one described in Paragraphs 24, in Paragraph 24, the D. Tomaso Declaration, and Paragraph 5, the Supplement Declaration, are the preferred design.

[00:03:27] Speaker 04:
So the prior decision said what was missing was evidence that GE is designing an engine now.

[00:03:35] Speaker 04:
The prior appeal, the facts referred to an engine that had been designed but was not being pursued.

[00:03:41] Speaker 04:
It is now being signed and being pursued.

[00:03:45] Speaker 04:
And then the other portion of the prior decision was definite plans to use the claimed features that are described in the declarations.

[00:03:55] Speaker 04:
And they are definite plans to bring a competitive engine to market, a competitive engine that will likely have those features.

[00:04:03] Speaker 04:
we would suggest, Ronald, that that fills the gap that's identified in the prior decision.

[00:04:08] Speaker 04:
And perhaps best evidence is UTC doesn't really quarrel with those facts.

[00:04:13] Speaker 04:
It doesn't offer you any other facts that are different than those facts.

[00:04:17] Speaker 04:
But Ashley says that's still too speculative.

[00:04:21] Speaker 04:
Well, that actually takes you so far as to suggest that GE would have to

[00:04:25] Speaker 04:
say or confess infringement in order to have the right to appeal.

[00:04:31] Speaker 04:
But JTEC isn't saying that.

[00:04:33] Speaker 04:
GE shouldn't be required to do that.

[00:04:35] Speaker 04:
GE isn't saying that it's infringing.

[00:04:38] Speaker 04:
What it's saying is, to use the words of JTEC, there's a substantial risk that if it pursues its present design, its present course, and brings that engine to market,

[00:04:50] Speaker 04:
UTC will assert this patent against it.

[00:04:53] Speaker 04:
And that is sufficient to satisfy the standing requirement.

[00:04:57] Speaker 04:
Because, Your Honor, the rest of the case, the rest of the facts, demonstrate that injury in fact is required.

[00:05:04] Speaker 04:
It's a very small market with only three people designing engines.

[00:05:09] Speaker 04:
It's a market with a very, very long design cycle.

[00:05:13] Speaker 01:
Mr. Lee, you're not asking this panel to ask the court to go in bank.

[00:05:19] Speaker 01:
We're not asking... That's the cleanest way, rather than trying to squirm around the prior case.

[00:05:27] Speaker 04:
Your Honor, I think that I would say two things.

[00:05:30] Speaker 04:
From the prior case, it's clear the G's position would be that even the facts of the prior case would demonstrate the type of competitor standing that the Supreme Court says is sufficient.

[00:05:40] Speaker 04:
But we understand we're bound by the panel decisions, so what we've done is look carefully at the panel decision.

[00:05:45] Speaker 04:
And the panel decision said,

[00:05:47] Speaker 04:
No present design, no present plans.

[00:05:50] Speaker 04:
And so what we've done, we hope, is provide a declaration to answer Judge Hughes's question that says, yes, we are.

[00:05:57] Speaker 00:
Your arguments still have an ambiance at the bottom of speculation, an absence of injury, in fact.

[00:06:05] Speaker 00:
I mean, you have a design.

[00:06:07] Speaker 00:
Why can't you design around?

[00:06:09] Speaker 00:
We don't know what's going to happen at the end of that production process.

[00:06:13] Speaker 00:
You may or may not have a problem.

[00:06:15] Speaker 04:
Your Honor, there is truth, there is that ambiguity, but that's why the case is recognized that you don't have to, you only have to have a substantial risk.

[00:06:26] Speaker 04:
You don't have to

[00:06:28] Speaker 04:
a conceded infringement.

[00:06:29] Speaker 04:
You don't have to admit infringement.

[00:06:31] Speaker 04:
You don't have to identify each and every limitation.

[00:06:33] Speaker 04:
This, Your Honor, is there a sufficient injury in fact?

[00:06:36] Speaker 04:
And the injury in fact here is we're in a three-player market with a very long design cycles where people are investing, as you know from the declarations, millions and millions of dollars on an annual basis.

[00:06:49] Speaker 04:
It takes a decade before those investments come to fruition, but you're making design decisions.

[00:06:55] Speaker 04:
judged against the background of a patent with a very broad claim.

[00:07:06] Speaker 04:
I'm trying to think through the example.

[00:07:08] Speaker 04:
I can think of examples where you would be designing a pharmaceutical, where there would be a patent that had very general, broad claims, and that you thought was anticipated obvious, and you would pursue an IPR.

[00:07:21] Speaker 04:
And that ought to be, if you're designing a product, if it's on the box, you're pursuing it, and you're trying to clear the playing field for that product,

[00:07:33] Speaker 04:
and you lose at the p-tab, you should have a right to appeal.

[00:07:35] Speaker 04:
So I think that there's, it doesn't matter what the technology is.

[00:07:41] Speaker 04:
And it shouldn't matter what, at the end of the day, what the result's going to be, because particularly in this case, where the design cycle is so long.

[00:07:50] Speaker 00:
You say it doesn't matter what the technology is.

[00:07:54] Speaker 00:
I always thought one of your strongest argument is that in this type of, with this product, we're dealing with a different type of market, with different type of competition.

[00:08:02] Speaker 00:
We're dealing with a different investment scheme and research and development type of structures.

[00:08:08] Speaker 00:
But you don't seem to rely too much on that type of argument.

[00:08:13] Speaker 04:
Your Honor, if I didn't, I was unclear.

[00:08:16] Speaker 04:
You're right.

[00:08:16] Speaker 04:
I mean, we think that for the question of injury and fact, the facts that you just articulated are precisely the reason there's an injury and fact, and precisely the reason that you want to clear the playing field when you have this small number of competitors in a market with a long design cycle where the investments are significant.

[00:08:37] Speaker 01:
You're not arguing that this is a DuPont case.

[00:08:41] Speaker 04:
No, we are not.

[00:08:44] Speaker 04:
We are arguing.

[00:08:45] Speaker 04:
I think at the risk of simplification, we are saying two things, which is if the standard were the Supreme Court's competitor standing standard, we would have it.

[00:08:57] Speaker 04:
But if it's not, if it's the panel decision in the prior GE case, and you look specifically at what was said to be missing, we have tried to provide as best we can, given everything that Judge Rainier has identified as the

[00:09:11] Speaker 04:
the vagaries of a long design cycle of a product like this, everything we could.

[00:09:17] Speaker 04:
And I think the question that the briefing by the other side would cause me to ask is this.

[00:09:23] Speaker 04:
If this is not enough, what is?

[00:09:26] Speaker 01:
And to remember that... You can look at a spectrum.

[00:09:30] Speaker 01:
On the one hand, you have DuPont, where they were building a plant that was there.

[00:09:36] Speaker 01:
On the other hand, you have non-commercial parties

[00:09:39] Speaker 01:
And here, you're in the middle.

[00:09:42] Speaker 01:
And aren't we in the area of fact questions, then?

[00:09:46] Speaker 04:
Well, there are certainly fact questions that I think goes to Judge Hughes's question.

[00:09:50] Speaker 04:
Because there is, we concede, a difference between the record in the prior appeal and this appeal.

[00:09:55] Speaker 04:
And the difference is what is currently occurring now.

[00:09:59] Speaker 04:
And given what is currently occurring now, if we could not take this appeal, what would be required to do it short of conceding infringement?

[00:10:09] Speaker 04:
And the answer would be virtually nothing, given everything that Judge Rainy had.

[00:10:15] Speaker 02:
Well, if we're talking about that spectrum, if there's not anything short of you're currently infringing to give you standing, then nothing would give you standing, except we're currently infringing.

[00:10:34] Speaker 02:
That, to me, sounds like you wouldn't even need to go to the PTAB.

[00:10:37] Speaker 02:
You could just go file a declaratory judgment action if you're infringing and go there if you wanted to.

[00:10:43] Speaker 02:
Is there any light of day between the declaratory judgment standard and Article III standing on appeal from an administrative agency when Congress has already provided a cause of action?

[00:10:54] Speaker 04:
Yes.

[00:10:55] Speaker 04:
I think it should be easier in the latter than the former.

[00:10:58] Speaker 04:
And the declaratory judgment standard would require certain things.

[00:11:01] Speaker 04:
beyond what the competitive standing or the ABX case or the prior decision in the case requires.

[00:11:10] Speaker 04:
I mean, this is a context that, as I said, has all of what Judge Rainier decided, but also this is in the record.

[00:11:16] Speaker 04:
In the effort to try to clear the playing field, TE has filed 31 IPRs.

[00:11:21] Speaker 04:
There have been 100 claims disclaimed during this process.

[00:11:26] Speaker 04:
100 claims that could relate to the engine that GE wants to design that will come to market 10 years from now and then be used for 25 more years.

[00:11:35] Speaker 04:
So we're talking like a 35-year-old window.

[00:11:38] Speaker 04:
This should be enough.

[00:11:40] Speaker 04:
And it should be enough particularly if I move to the merits before I go into my rebuttal time.

[00:11:46] Speaker 04:
And on the merits of the question of obviousness, let me say this.

[00:11:53] Speaker 04:
The findings of the PTAB at A16 and A23 to A24, together with KSR, are and should be dispositive.

[00:12:01] Speaker 04:
And again, there are five.

[00:12:03] Speaker 04:
First, the PTAB says, and there's no dispute, that Wendis discloses each limitation of claim 10, except for two stages.

[00:12:12] Speaker 04:
Second, Moxon discloses two stages.

[00:12:16] Speaker 04:
Third, for these types of engines, prior to the filing date of the 920 patent, it was either one or two stages.

[00:12:26] Speaker 04:
Fourth, it was a binary decision.

[00:12:28] Speaker 04:
And fifth, one of ordinary skill in the art knew that

[00:12:33] Speaker 04:
If you use one stage, it costs less and weighs less.

[00:12:36] Speaker 04:
If you use two stages, it was more reliable and more efficient.

[00:12:39] Speaker 01:
But if you change the number of stages, you're changing the system, and you've got to make a lot of changes, right?

[00:12:46] Speaker 04:
Your Honor, that's what they claim, but there's no proof of it.

[00:12:50] Speaker 04:
And there's no proof that one of the organized skill in the art couldn't have done that and had a reasonable expectation of success.

[00:12:56] Speaker 04:
And the two best facts to indicate that is, if you look at the specification of the patent,

[00:13:01] Speaker 04:
The person of ordinary skill in the art here actually is a rocket scientist.

[00:13:06] Speaker 04:
That's what the person is by agreement.

[00:13:09] Speaker 04:
The specification

[00:13:11] Speaker 04:
has virtually nothing that tells you how to design misclaimed engine.

[00:13:16] Speaker 04:
And it's because the person of organized skill in the art would know how to do that.

[00:13:21] Speaker 04:
And then if you take the breadth of the claim, right, and you look at the combination of Lennis and Moxon, there is nothing to suggest that that couldn't be combined without a reasonable expectation of success.

[00:13:36] Speaker 04:
And I think the last thing I'll say to save my rebuttal time, Your Honor, is this.

[00:13:41] Speaker 04:
The answer to your question might have been no reasonable expectation of success.

[00:13:46] Speaker 04:
The PTAB says explicitly, we're not relying upon no reasonable expectation of success.

[00:13:51] Speaker 04:
We're not reaching that issue.

[00:13:53] Speaker 01:
We will say the remainder of your time, Mr. Lee, Mr. Coyne.

[00:14:00] Speaker 03:
Thank you, Your Honor.

[00:14:01] Speaker 03:
May I please support?

[00:14:02] Speaker 03:
I'm Patrick Coyne, representing United Technologies Corporation.

[00:14:06] Speaker 03:
The standing issue, as Judge Hughes pointed out, is slightly different than it was before.

[00:14:11] Speaker 03:
They rely on two things.

[00:14:12] Speaker 03:
The new market aircraft, which is now aborted.

[00:14:16] Speaker 03:
The program's been canceled by Boeing.

[00:14:18] Speaker 03:
They didn't bid a geared engine.

[00:14:20] Speaker 03:
So those facts are irrelevant.

[00:14:22] Speaker 03:
The only facts that are different are the Dittamasi Declaration and Mr. Long's declaration.

[00:14:29] Speaker 03:
My colleagues identified a number of factors in there that he feels get them over the hurdle.

[00:14:35] Speaker 03:
They don't.

[00:14:35] Speaker 03:
Why?

[00:14:36] Speaker 03:
Because what this court's jurisprudence clearly establishes, whether it's economic injury or competitive injury, is that they have to be doing something that uses the claimed invention.

[00:14:49] Speaker 02:
So they have to be currently infringing?

[00:14:50] Speaker 03:
No, Your Honor.

[00:14:52] Speaker 02:
We are not contending they have to be currently infringing.

[00:14:56] Speaker 03:
Well, if they're using them, what AVX permits them to do under the competitive standing doctrine is to have plans.

[00:15:06] Speaker 03:
If they were planning something that had concrete plans that would use the claimed invention,

[00:15:12] Speaker 03:
We wouldn't be able to sue them for that.

[00:15:14] Speaker 03:
They haven't committed an act of infringement yet.

[00:15:16] Speaker 03:
They simply have plans.

[00:15:17] Speaker 03:
It's a thought crime.

[00:15:18] Speaker 03:
We can't go after that.

[00:15:19] Speaker 03:
They haven't made, used, or sold.

[00:15:21] Speaker 02:
So if they're designing an engine that potentially infringes, can you sue them?

[00:15:27] Speaker 03:
No, if they're designing an engine that potentially infringes, they haven't committed an active infringement yet.

[00:15:33] Speaker 02:
Well, Claim 9, from which Claim 10 depends, is a method of designing a claim.

[00:15:40] Speaker 02:
Why wouldn't that infringe if they are using your method to design this engine, even if they haven't actually put it into production?

[00:15:48] Speaker 03:
Okay, in that specific situation, if they're using that method of designing, that would be an act of infringement.

[00:15:55] Speaker 03:
That doesn't mean that we're saying in every instance you have to infringe in order to have standing.

[00:16:01] Speaker 03:
You don't.

[00:16:02] Speaker 03:
This particular claim is a method of designing that engine.

[00:16:06] Speaker 03:
What they have to be designing, though, the hole here is twofold.

[00:16:09] Speaker 03:
Number one, they aren't saying they're designing the engine.

[00:16:12] Speaker 03:
They haven't said clearly, we are designing this.

[00:16:15] Speaker 03:
We have concrete plans.

[00:16:16] Speaker 02:
They're going to get on the record and say, we're going to infringe this patent.

[00:16:19] Speaker 02:
And there's no precedent that says they have to admit to infringement before they have Article III standing.

[00:16:25] Speaker 02:
No, Your Honor.

[00:16:25] Speaker 02:
So if that's the fault you're finding, then I think your argument doesn't have any merit.

[00:16:29] Speaker 03:
I'm not saying that it's not the fault that I'm finding.

[00:16:32] Speaker 03:
The fault that I'm finding is what is it that they are designing.

[00:16:36] Speaker 03:
What they have said is only two elements.

[00:16:38] Speaker 03:
This claim has nine structural elements, 16 to 18 limitations, depending on which claim you look at.

[00:16:44] Speaker 03:
They've identified only two.

[00:16:46] Speaker 03:
that they say that they are considering.

[00:16:49] Speaker 03:
Secondly, the fault is that it's still not a statement that we are designing.

[00:16:54] Speaker 03:
It's a statement that we're considering.

[00:16:56] Speaker 03:
We're going to continue to consider.

[00:16:57] Speaker 03:
We might possibly do it.

[00:16:59] Speaker 03:
We are very far from a design here at this point, and the design that we are looking at

[00:17:05] Speaker 03:
includes not all the limitations, it includes only two.

[00:17:08] Speaker 03:
Now, Mr. Leah said, oh, well, you're going to obviously fall within the scope of the claim.

[00:17:13] Speaker 03:
That's just not true.

[00:17:15] Speaker 03:
In fact, what the board found at page 828 of the appendix in the board's final written... Why do they have to say they're going to obviously fall into the scope of the claim?

[00:17:25] Speaker 02:
Why can't they say, we are expending money, we have designs,

[00:17:30] Speaker 02:
And it is very likely that we're going to fear infringement here, that there's a substantial risk of an infringement.

[00:17:39] Speaker 03:
Because the substantial risk of infringement they're arguing is their subjective belief that we are going to sue them.

[00:17:46] Speaker 03:
They have not identified anything yet.

[00:17:48] Speaker 03:
for which we could sue them, for which we are likely to sue them.

[00:17:51] Speaker 03:
There's got to be an element of reasonableness to this, some objective reality.

[00:17:56] Speaker 03:
They're basing it on, oh, I'm using two of nine elements.

[00:18:00] Speaker 03:
I'm not going to tell you whether I am using the claimed invention or whether I fall within something that's covered by it.

[00:18:06] Speaker 02:
Again, stop talking about telling them that you're using the claimed invention.

[00:18:10] Speaker 02:
Even you said that that's not required for standing.

[00:18:13] Speaker 02:
They don't have to admit that they're infringing.

[00:18:18] Speaker 03:
Your Honor, you're correct.

[00:18:19] Speaker 03:
They do not have to admit that they're infringing, but they have to be undertaking plans to do something that would use the claimed invention.

[00:18:27] Speaker 02:
That raises the substantial likelihood of infringement.

[00:18:30] Speaker 03:
At least, yes.

[00:18:31] Speaker 03:
And that is not what we have in this court.

[00:18:34] Speaker 02:
So they don't have to go through each and every claim element and say, our engine is going to have this, our engine is going to have this, our engine is going to have this, do they?

[00:18:43] Speaker 03:
Do they have to go through each and every claim element?

[00:18:46] Speaker 03:
I don't know necessarily.

[00:18:47] Speaker 02:
I think this case doesn't... If they're going to do that, then they're going to be saying, yes, we're infringing each and every single claim element.

[00:18:54] Speaker 03:
I can see, Your Honor, that there may be situations where what they're doing is close enough that they'd be worried about getting sued under equivalence.

[00:19:00] Speaker 03:
We're not even close to that line in this case, because all they've identified is that they want to use two

[00:19:06] Speaker 03:
of the nine structural elements, and they haven't identified any of the limitations of the claim that they fall within.

[00:19:14] Speaker 03:
So, again, getting back to what this Court has said in AVX, it's their burden to show that they are, in fact, have concrete plans and to do something, they don't have to have done it, they don't have to have committed an infringement yet, but they have to have concrete plans to do something that would likely infringe.

[00:19:31] Speaker 00:
Wouldn't the amount of investment that they've incurred show those concrete plans?

[00:19:39] Speaker 03:
No, Your Honor.

[00:19:39] Speaker 03:
Well, not on this record.

[00:19:42] Speaker 03:
Would they be able to put in?

[00:19:43] Speaker 03:
Sure, they could put in and say, look, I spent this much to avoid this patent, but they didn't do that.

[00:19:48] Speaker 03:
What they've said is, I've invested, I think it's under the confidential record, a lot of millions of dollars over the past 40 years.

[00:19:57] Speaker 03:
Well, this patent hasn't been around for 40 years.

[00:19:58] Speaker 03:
There's no nexus.

[00:20:00] Speaker 03:
What they've put in as proof of how much they've spent has no nexus to this invention.

[00:20:06] Speaker 03:
They're including things they did 40 years ago on programs that they've abandoned 20 years ago.

[00:20:10] Speaker 03:
So that doesn't get them over the hurdle.

[00:20:13] Speaker 03:
They still have to be doing something under the sports holdings in JTAC, AVX, GE, that they are doing something or planning to do something, have concrete plans to do something that would be covered by the invention.

[00:20:27] Speaker 03:
And then secondly, as I said, the statements they've made, possibly considering it's too speculative.

[00:20:34] Speaker 00:
So is it your view that there's hardly any factual differences between this case and GE1?

[00:20:40] Speaker 00:
I'm sorry, Ron?

[00:20:40] Speaker 00:
Any factual differences between this case and GE1?

[00:20:44] Speaker 03:
Sure.

[00:20:45] Speaker 03:
In GE1, all they put in was evidence of the NMA program, which wasn't sufficient, and that program's now been canceled by Boeing, so it's moot.

[00:20:54] Speaker 03:
They've put in evidence on this program,

[00:20:55] Speaker 03:
for this what they call the next generation aircraft program.

[00:20:59] Speaker 03:
But as I've said, what it fails to do is show that they have plans to use the claimed invention.

[00:21:05] Speaker 03:
So getting back to Judge Hughes' point, no, if they start the design process and they're designing it, sure, they're infringing then, but they haven't shown plans for even a program that would use the claimed invention.

[00:21:17] Speaker 00:
What do you mean plans?

[00:21:18] Speaker 00:
Are you talking about actual design or specifications, user specifications?

[00:21:23] Speaker 03:
Well, the Tomasi Declaration lays out this design process.

[00:21:27] Speaker 03:
You go through a cycle of requests for information with the airframer.

[00:21:31] Speaker 03:
Then you have requests for proposal.

[00:21:33] Speaker 03:
Then they down select how many engines they're going to... Are you saying all that's missing here?

[00:21:37] Speaker 03:
They haven't told us where they are in the process at all.

[00:21:40] Speaker 03:
They outline this process.

[00:21:42] Speaker 02:
So in order to give...

[00:21:44] Speaker 02:
Article 3 standing, which is not a particularly high hurdle, they have to give you detailed plans of their corporate strategy in designing airplane engines?

[00:21:53] Speaker 03:
No, Your Honor, they don't have to go that far.

[00:21:54] Speaker 03:
All they have to do under this Court's jurisprudence is have a concrete plan, not having actually undertaken the design yet, but a concrete plan to design something that would likely infringe.

[00:22:07] Speaker 03:
They haven't done that.

[00:22:08] Speaker 03:
They've said, worth possibly considering thinking about it, and it will have only two of the nine elements.

[00:22:13] Speaker 03:
That's way far of the line they need to reach.

[00:22:17] Speaker 03:
It's too speculative at this point.

[00:22:18] Speaker 03:
They will have, as they pointed out themselves, years of further development for this engine.

[00:22:24] Speaker 03:
Come back when they have a plan to do something that implicates this plan.

[00:22:28] Speaker 02:
So then they have to undertake a specific plan and start incurring significant financial cost

[00:22:36] Speaker 02:
before they have Article 3 standing, in order to clear what they think is an invalid patent.

[00:22:42] Speaker 03:
No, Your Honor, I wouldn't go that far.

[00:22:43] Speaker 03:
You said that is not correct.

[00:22:44] Speaker 03:
I wouldn't go that far.

[00:22:45] Speaker 03:
I would say that they have to have a concrete plan to do that type of design.

[00:22:51] Speaker 02:
They don't have to start it... They say we have... Thank you for... I'm sorry, I'm talking for you too, but I appreciate when you stop.

[00:22:58] Speaker 02:
Too many of your colleagues in the bar do not.

[00:23:04] Speaker 02:
What does it mean to have a concrete plan then if they haven't undertaken it?

[00:23:09] Speaker 02:
Isn't it?

[00:23:10] Speaker 02:
This is an area that is competitive.

[00:23:12] Speaker 02:
There's only three engines here.

[00:23:13] Speaker 02:
There are a certain number of choices here.

[00:23:16] Speaker 02:
And we intend to design next generation engines or whatever you want to call them that are likely to infringe because these are the kind of elements our clients are going to want.

[00:23:26] Speaker 02:
Is that not a concrete plan?

[00:23:28] Speaker 03:
No, that's not what they've said.

[00:23:29] Speaker 03:
What they've said is,

[00:23:30] Speaker 03:
We intend to make a competitive engine.

[00:23:33] Speaker 03:
We're afraid they're going to sue us.

[00:23:36] Speaker 02:
Don't quibble on the facts here.

[00:23:37] Speaker 02:
Just assume what I said is an accurate depiction of their declaration.

[00:23:41] Speaker 02:
Is that a concrete plan?

[00:23:43] Speaker 03:
I don't think it is, Your Honor.

[00:23:44] Speaker 02:
And what's not concrete about it?

[00:23:46] Speaker 03:
Because they haven't said specifically they are moving forward with that plan.

[00:23:50] Speaker 03:
They haven't reached the design stage yet, but they haven't said they're moving forward with that plan.

[00:23:54] Speaker 03:
They simply said we're considering it, and we're going to continue to consider it.

[00:24:00] Speaker 01:
Patent clearance is sometimes a preliminary to proceeding with a plan and making a big investment.

[00:24:08] Speaker 03:
Sure, but they're not going to be making that big investment.

[00:24:11] Speaker 02:
So right now, the program... So is what's insufficient in their current declaration a sentence that says, we intend to move forward with engine design that is likely to, or it has a substantial likelihood of infringement?

[00:24:26] Speaker 02:
If they had a sentence that said, we intend to invest money and develop client business in an engine design that has a substantial likelihood of infringement.

[00:24:38] Speaker 03:
if they came forward with competent evidence and further said that it was sufficient to show a concrete plan, a fixed plan to move forward.

[00:24:48] Speaker 03:
Right now, that's not what we've got.

[00:24:49] Speaker 02:
That seems to have said that.

[00:24:50] Speaker 02:
We have a concrete plan to pursue engine design and develop client business of an engine design that has a substantial likelihood of infringing that patent.

[00:25:03] Speaker 03:
Well, I guess, Your Honor, I don't agree with the characterization of the De Tomasi declaration in that regard.

[00:25:08] Speaker 02:
No, no.

[00:25:08] Speaker 02:
I'm asking you a hypothetical.

[00:25:09] Speaker 03:
Okay.

[00:25:10] Speaker 02:
Maybe I didn't make that clear.

[00:25:11] Speaker 03:
I'm sorry.

[00:25:11] Speaker 02:
Is that sentence, if it was in the declaration, sufficient?

[00:25:15] Speaker 03:
If they had said, we have a concrete plan and brought competent evidence of it... What do you mean by competent evidence?

[00:25:21] Speaker 03:
Well, admissible evidence.

[00:25:23] Speaker 03:
They'd have to be bringing the declaration.

[00:25:25] Speaker 03:
Again, we did not, Mr. Lee pointed out... The declaration has that sentence in it.

[00:25:29] Speaker 03:
The declaration does not have the sentence that says... No, no, no, I'm not asking about the facts again.

[00:25:33] Speaker 02:
I'm sorry.

[00:25:34] Speaker 02:
I'm asking a hypothetical.

[00:25:36] Speaker 02:
A declaration has that sentence.

[00:25:38] Speaker 02:
I don't want to repeat it again.

[00:25:39] Speaker 02:
Okay.

[00:25:39] Speaker 02:
Is that enough?

[00:25:42] Speaker 03:
I'm not sure it would be, Your Honor, because this court... What is lacking there?

[00:25:45] Speaker 03:
Well, what's lacking there is that this court has said repeatedly, you have to be doing something that's covered by the patent.

[00:25:51] Speaker 03:
So it has to be a concrete plan to do something that would be covered by the patent.

[00:25:56] Speaker 02:
And what's lacking is they've only identified... When they say they have a substantial likelihood of infringement, that's not enough.

[00:26:02] Speaker 02:
I thought that's the standing.

[00:26:03] Speaker 03:
No, Your Honor, it's not enough because the substantial likelihood, it's clear from the declarations they filed.

[00:26:08] Speaker 02:
So you think the thing has to say, we have a concrete plan to move forward with an engine design that will infringe?

[00:26:13] Speaker 03:
Well, or that's close... Again, we're not close to the line in this case, but they'd have to come... Please stick with the hypothetical.

[00:26:21] Speaker 02:
I mean, I don't care about the facts here.

[00:26:23] Speaker 02:
What's the difference between substantial likelihood of infringement and what I think you were just about to say is, you know, maybe not actual infringement, but close enough.

[00:26:34] Speaker 03:
Okay.

[00:26:35] Speaker 02:
The difference here is that they agree that the standard is substantial likelihood of infringement, isn't it?

[00:26:40] Speaker 03:
Yes, Your Honor, objectively, reasonably, not because they're saying that they think we're going to sue them when we don't have any factual basis to do that.

[00:26:48] Speaker 02:
Well, that's what I'm a little curious about.

[00:26:51] Speaker 02:
What kind of factual basis do you need beyond their statements under oath and declarations that they're going to do this?

[00:26:58] Speaker 02:
Do they have to lay out their actual business plans and their actual design plans for their competitors?

[00:27:05] Speaker 03:
Not all of them.

[00:27:06] Speaker 03:
They'd have to lay out enough to show that it implicates this claim, that what they're planning on building and designing and spending money on would be covered by this claim.

[00:27:16] Speaker 03:
I wonder if I could switch.

[00:27:16] Speaker 03:
I only have a minute and a half left.

[00:27:18] Speaker 03:
If I could switch to the merits.

[00:27:20] Speaker 03:
Mr. Lee briefly touched on that.

[00:27:23] Speaker 03:
He's identified five factors that he said the board found in their favor.

[00:27:28] Speaker 03:
I'm not going to quibble with that.

[00:27:29] Speaker 03:
The board did find certain facts in their favor.

[00:27:31] Speaker 03:
But what he's missing is that the board didn't rule in their favor.

[00:27:35] Speaker 03:
If this issue was, is there substantial evidence to support a hypothetical finding in their favor?

[00:27:40] Speaker 03:
Sure.

[00:27:41] Speaker 03:
But there's substantial evidence to support the findings the board did make.

[00:27:44] Speaker 03:
in our favor.

[00:27:45] Speaker 03:
The board looked at the evidence as a whole.

[00:27:47] Speaker 03:
It applied the correct legal standard.

[00:27:50] Speaker 03:
And weighing the evidence, the Wendis and Moxon are fundamentally inconsistent.

[00:27:55] Speaker 03:
One says go to the one stage and the other says don't even think about it.

[00:27:59] Speaker 03:
So the board

[00:28:00] Speaker 03:
is absolutely on solid ground in terms of substantial evidence for all of its findings, applied the correct standard, and reached the correct result.

[00:28:08] Speaker 03:
There's no issue here of error in the board's consideration.

[00:28:11] Speaker 03:
I only have 50 seconds left, Your Honor.

[00:28:13] Speaker 03:
If anybody has any questions, I'm happy to try to answer them.

[00:28:16] Speaker 01:
Thank you, Mr. Coyne, unless you want to use your 45 seconds for summary.

[00:28:21] Speaker 03:
Okay, well, getting back to the, this court's precedent is very clear.

[00:28:26] Speaker 03:
The claim does present some challenges because it is a method of designing, yes.

[00:28:30] Speaker 03:
And that probably narrows their scope of that, on that spectrum of how much space they have.

[00:28:35] Speaker 03:
But we're not saying they have to infringe, but they do have to have a concrete plan to do something covered by the patent, and these declarations do not provide it.

[00:28:43] Speaker 03:
Thank you, Your Honor.

[00:28:43] Speaker 01:
Thank you, Mr. Coyne.

[00:28:45] Speaker 01:
Mr. Lee has some rebuttal time.

[00:28:47] Speaker 04:
Yes, your honor.

[00:28:50] Speaker 04:
On the standing issue.

[00:28:52] Speaker 02:
Can you try to explain to me what you're saying in the light of day between actually infringing and a concrete plan to

[00:29:04] Speaker 02:
I don't even know what the standard is to infringe.

[00:29:07] Speaker 04:
Your Honor, the honest answer to your question is I can't because I don't think there's any daylight between what they're urging you and conceding infringement.

[00:29:15] Speaker 04:
And the JTAC standard is a substantial risk.

[00:29:19] Speaker 04:
But even if you take their articulation, which is a concrete plan,

[00:29:23] Speaker 04:
Here's what the declarations say, paragraph 9 of the long declaration, GE presently has a new design in development and then goes on to describe it confidentially.

[00:29:34] Speaker 04:
GE fully expects that UTC will expect, expects UTC to use that engine design of infringement.

[00:29:41] Speaker 04:
De Tomaso says at 22.

[00:29:43] Speaker 02:
Do you see his argument as suggesting that that declaration is unsupported by other factual evidence?

[00:29:51] Speaker 02:
It seems to me that that's what he was saying, but that seems to be a peculiar way of looking at Article 3 standing, which is not a very high burden.

[00:30:00] Speaker 04:
For Article 3 stating to take an appeal where the statutory scheme provides you an appeal and where if you don't have an appeal, someday you may get a stop based upon the PTABS fund.

[00:30:13] Speaker 04:
It doesn't make sense as a matter of policy or the way the laws are articulated.

[00:30:18] Speaker 04:
But even if you take Mr. Coyne's proposition, concrete plans,

[00:30:21] Speaker 04:
There are at least three paragraphs where DiTomasso or Long says, we are doing this, we're doing it now, and we have in DiTomasso paragraph 24 describes specifically the amount of money designing this design in 2019.

[00:30:39] Speaker 04:
Second point is on the merits of the obviousness of the patent.

[00:30:44] Speaker 04:
I think we can capture all of UTC's argument when he says, when this says don't do it at all,

[00:30:51] Speaker 04:
Wendy says nothing of the kind.

[00:30:53] Speaker 04:
It never says anything at all about one stage versus two stage.

[00:30:58] Speaker 04:
And the one place it says anything, it says two stages are better.

[00:31:03] Speaker 04:
They are asking you to take a claim, which has now been disclaimed to the world, where the only distinction is two stages.

[00:31:12] Speaker 04:
Wendy says everything else and say, no, it's patentable.

[00:31:16] Speaker 04:
It's totally inconsistent.

[00:31:18] Speaker 04:
Thank you, Your Honor.

[00:31:19] Speaker 01:
Thank you, Mr. Lee.

[00:31:20] Speaker 01:
We'll take the case under advisement.