[00:00:43] Speaker 00:
You can proceed, counsel.

[00:00:47] Speaker 00:
You can proceed.

[00:00:48] Speaker 00:
You're reserving three, correct?

[00:00:51] Speaker 01:
Yes, your honor.

[00:00:52] Speaker 00:
I'll try to let you know.

[00:00:53] Speaker 01:
OK, thank you.

[00:00:56] Speaker 01:
May it please the court, Prateek Shah for appellants.

[00:00:59] Speaker 01:
The district court prematurely cut off appellant XY's claim in two significant respects.

[00:01:05] Speaker 01:
First, the district court appellate.

[00:01:07] Speaker 00:
As an initial matter.

[00:01:08] Speaker 00:
Sure.

[00:01:10] Speaker 00:
Which claims of the 559 are you asserting here in your 101?

[00:01:13] Speaker 01:
It is claim one is the independent claim.

[00:01:17] Speaker 01:
And then there are a couple of dependent claims that are set forth in the brief that have further mathematical operations, involve scaling, zooming.

[00:01:28] Speaker 01:
Let's see, those are claims.

[00:01:34] Speaker 01:
Claim one is the independent claim and then the independent claims are Do we have the number of those?

[00:02:12] Speaker 01:
Pardon?

[00:02:13] Speaker 01:
2 through 23 are the dependent claims.

[00:02:17] Speaker 00:
In the appendix in the opinion at 11 and 12, the district court says that our precedent is inconsistent when it comes to Gillard v. Nike and whether the claim preclusion doctrine requires plaintiffs to amend their pleadings when it comes to new rights acquired.

[00:02:36] Speaker 00:
The Gillard quote is, the race judicata

[00:02:40] Speaker 00:
doctrine does not apply to new rights acquired during the action, which might have been, but were not litigated.

[00:02:46] Speaker 00:
What's your response to that position?

[00:02:48] Speaker 00:
And how relevant is it to your case?

[00:02:51] Speaker 01:
Sure, Your Honor.

[00:02:52] Speaker 01:
I don't think it's critical to our case, because Simple Air, I think, reconciles the body of race judicata law that was out there.

[00:02:59] Speaker 01:
And Simple Air was decided after the district court.

[00:03:02] Speaker 01:
We're not faulting the district court, but Simple Air is the law now.

[00:03:05] Speaker 01:
And what Simple Air seems to do, it says,

[00:03:07] Speaker 01:
Look, what Nike said when it said that was not laying down a categorical rule.

[00:03:12] Speaker 01:
You could imagine a circumstance where you had an after-issued claim and it did, in fact, trigger race judicata, but it would have to be essentially the same patent claim scope.

[00:03:26] Speaker 01:
And it says, outside of the distinct reexamination context, you have to do a claim by claim analysis to determine whether it's essentially the same, whether it's issued after or before.

[00:03:38] Speaker 01:
And so Simple Air, I think, lends a lot of clarity here.

[00:03:42] Speaker 01:
And if the district court had the advantage of Simple Air, I think this case would have proceeded very differently.

[00:03:47] Speaker 01:
And I think that's the key point.

[00:03:52] Speaker 01:
And since we're on race judicata,

[00:03:54] Speaker 01:
I think that is straightforward in light of simple error, so maybe I can quickly address that before we move on to the 101.

[00:04:03] Speaker 01:
Simple error is unequivocal, and it says at page 1167 of that opinion, race judicata applies, quote, only if the scope of the asserted claims in the two suits is essentially the same.

[00:04:17] Speaker 01:
And then it says that requires, at least outside the re-examination context, which is not applicable here, comparing the patent claims.

[00:04:26] Speaker 01:
Yet, just like the district court in simple error, the district court here failed to conduct that claim-by-claim analysis for the three patent counts at issue on race judicata.

[00:04:39] Speaker 01:
And in fact, the facts in simple error are sort of much worse for the party that was trying to avoid race judicata.

[00:04:45] Speaker 01:
There you had.

[00:04:46] Speaker 01:
exactly the same accused products.

[00:04:49] Speaker 01:
You had a common specification.

[00:04:51] Speaker 01:
You had a terminal disclaimer to the same patent, findings that there was strategic conduct by the plaintiffs, which isn't here.

[00:05:00] Speaker 01:
And all of that still, this court said, no, all of that is not enough to get to race judicata.

[00:05:07] Speaker 01:
You have to look at the claims.

[00:05:09] Speaker 01:
And therefore, it vacated the district court and sent it back to do a claim-by-claim analysis.

[00:05:15] Speaker 01:
So here, at the very minimum, it's a vacater and remand to do that sort of claim-by-claim analysis.

[00:05:23] Speaker 01:
But we think that, in fact, you can go a step further because although the district court didn't do that analysis, the briefs here fully do engage in that analysis, claim-by-claim analysis.

[00:05:34] Speaker 01:
And in our view,

[00:05:36] Speaker 01:
It's pretty plain from the face of the patents that they're not materially the same claims.

[00:05:44] Speaker 01:
If you take, for example, the 422 patent, there's three of them, the 422 adds a super ovulation step that everyone agrees is simply not present.

[00:05:53] Speaker 01:
in the patents that were at issue in the prior 2012 suit.

[00:05:57] Speaker 01:
That was a continuation in part, and the reason it was in part is because it added three paragraphs to the specification that specifically provided the support for the super ovulation step, and then the corresponding claim in the 422 patent added the super ovulation step.

[00:06:14] Speaker 01:
So it's clearly not the same scope as the 2012 patent with respect to the 116 patent, the pulse laser patent,

[00:06:22] Speaker 01:
Different inventors, different subject matter.

[00:06:25] Speaker 01:
It was the change from using a continuous laser, which was present in the 2012 patents, versus a pulse laser, and not just a pulse laser.

[00:06:34] Speaker 01:
But in fact, claim one, which is the claim that survives and that's at issue here, that talks about multiply hitting a sorted particle, a particle that's trying to be sorted, multiply hitting it repeatedly.

[00:06:50] Speaker 01:
And that is an innovation that wasn't present in the 2012 patents.

[00:06:54] Speaker 01:
And then the last one is the 769 patent.

[00:06:57] Speaker 01:
That is also undisputably broader in scope than the ones that were issued

[00:07:02] Speaker 01:
in the 2012 case, because it drops two of the elements, the freezing and collection steps.

[00:07:08] Speaker 03:
So it's your view we should hold a trial this morning on those issues?

[00:07:12] Speaker 01:
Your Honor, I think those can be decided by this court, even though the district court didn't reach it, because I think based on the briefing here, it's clear those are different in scope.

[00:07:22] Speaker 01:
But if there's any doubt about that at a minimum, you could remand.

[00:07:25] Speaker 04:
That's not what happened.

[00:07:26] Speaker 04:
In simple error, there was a remand, right?

[00:07:27] Speaker 01:
Yes.

[00:07:27] Speaker 01:
In simple error, they did.

[00:07:29] Speaker 01:
They simply just vacated and remanded.

[00:07:30] Speaker 04:
And they said there might have to be a claim construction, right?

[00:07:33] Speaker 01:
Yes.

[00:07:33] Speaker 01:
They said there might have to be claim construction on the facts of that case.

[00:07:37] Speaker 01:
So certainly, that's what they did in simple error and the court, obviously.

[00:07:41] Speaker 01:
can follow that path as well.

[00:07:44] Speaker 01:
If I should move on to the Section 101 argument, we think that the facts here are about as close as you're going to get to the Deere case.

[00:07:53] Speaker 01:
Both inventions, the Deere, the Supreme Court's decision in Deere,

[00:07:59] Speaker 01:
both involve improvements to otherwise known industrial processes through the specific application of mathematical algorithms.

[00:08:08] Speaker 01:
And let me break down the ways in which they're similar.

[00:08:11] Speaker 01:
So first, as to the improvement step, in deer, you had an inventive step that improved the industrial process of curing rubber, right?

[00:08:21] Speaker 01:
Whereas here, you have an improvement

[00:08:23] Speaker 01:
that improves the sorting method.

[00:08:25] Speaker 01:
You get a greater purity in the sort.

[00:08:28] Speaker 01:
So you have improvements in both.

[00:08:30] Speaker 01:
The second one applied to otherwise known industrial processes.

[00:08:33] Speaker 01:
In deer, it was applying it, obviously, to the industrial process of curing rubber, which had been around a long time.

[00:08:39] Speaker 01:
Here, it's applying it to the known industrial process of sorting particles through the use of flow cytometry.

[00:08:46] Speaker 04:
What about the difference where deer, one of the emphasis there, was continuing to run that algorithm

[00:08:53] Speaker 04:
and checking on, running that algorithm repeatedly and then setting off the alarm, I think, to end the process of molding.

[00:09:04] Speaker 04:
when the algorithm reached a certain result.

[00:09:07] Speaker 04:
And you don't have that here, necessarily.

[00:09:09] Speaker 04:
You do have this algorithm continually to run while the particles are going through the flow cytometer.

[00:09:14] Speaker 01:
Yes, I think it's the equivalent.

[00:09:16] Speaker 01:
It's a different technology, obviously, but it's basically the same thing.

[00:09:20] Speaker 01:
In deer, they were harnessing the Arrhenius equation to help them determine what is the right time, as you said, to cut off.

[00:09:28] Speaker 01:
the curing process.

[00:09:29] Speaker 01:
Here they're harnessing a rotational um um alteration algorithm which allows the flow cytometer to get a greater clarity in the separation of data so it doesn't discard particles that it wasn't doing it and it's doing it now in real time so that data is continuously being processed sent to the flow cytometer so that the flow cytometer can better

[00:09:52] Speaker 01:
detect, oh, this is an X chromosome, this is a Y chromosome, and therefore gain a greater purity than was ever present in the existing art.

[00:10:01] Speaker 01:
And that's set forth in the specification itself, that it in fact is an improvement.

[00:10:05] Speaker 01:
So just like in deer, where using the Arrhenius equation in that continuous manner improved the, you got better cured rubber, here you have better sorted particles.

[00:10:17] Speaker 01:
And so it's about as, you know, usually we end up looking to the Federal Circuit cases to find the best analog.

[00:10:24] Speaker 01:
But here, in fact, I think it's the Supreme Court case that provides the best factual analog.

[00:10:29] Speaker 04:
And so... Can I ask you another question about this 101 issue?

[00:10:32] Speaker 04:
Sure.

[00:10:32] Speaker 04:
The court held that the claims you're directed to

[00:10:35] Speaker 04:
The mathematical equation that permits rotating multi-dimensional data.

[00:10:40] Speaker 04:
Right.

[00:10:41] Speaker 04:
What's your view of what the claims are directed to?

[00:10:43] Speaker 01:
We think, just like in DEER, the claims are directed to an improved industrial process for sorting particles.

[00:10:49] Speaker 01:
That was the objective by doing it.

[00:10:52] Speaker 01:
Just like in DEER, they did use the Arrhenius equation to get better cured rubber, and here we're using the rotational algorithm

[00:10:59] Speaker 04:
Would you even go mirror that and say it's an improved cytometer?

[00:11:02] Speaker 01:
Yes.

[00:11:03] Speaker 01:
Yes, exactly, Your Honor, just as we said in our brief.

[00:11:07] Speaker 01:
It's a cytometer configured in a specific way to sort particles, and it's improving the outcomes reached in that by using this rotational algorithm, which enhances data separation, which is then fed into the flow cytometer, which then does it in a very specific way.

[00:11:22] Speaker 01:
So this is very different

[00:11:23] Speaker 01:
for example, than trying to... The inventors here weren't trying to preempt in any way use of rotational algorithms.

[00:11:30] Speaker 01:
Rotational algorithms obviously had been around a long time, but this is the first time anyone had thought to use it in conjunction with this industrial process.

[00:11:39] Speaker 01:
The inventors here do not care about rotational algorithm and are not trying to capture its use in any other of the million ways in which it's used.

[00:11:49] Speaker 01:
This is not tacking on

[00:11:51] Speaker 01:
a post-solution process, as in some other cases, in order to get to that natural law.

[00:11:56] Speaker 01:
Here, they really care about the industrial process.

[00:11:59] Speaker 01:
That's what the patent is all about.

[00:12:00] Speaker 01:
That's what it's directed to, an improved flow cytometry method of sorting particles.

[00:12:07] Speaker 01:
And one step in that, just like in deer, one step was using the Arrhenius equation

[00:12:11] Speaker 01:
to get there.

[00:12:12] Speaker 01:
Here, using the rotational alteration algorithm is one step to help you get there.

[00:12:18] Speaker 03:
Do you have any comment on Thales' Vision X case?

[00:12:24] Speaker 01:
Sure, Your Honor.

[00:12:25] Speaker 01:
We think Thales supports that.

[00:12:27] Speaker 01:
Thales, in fact,

[00:12:28] Speaker 01:
I think characterized itself as a step one case.

[00:12:32] Speaker 01:
We think, Your Honor, this is also a step one case.

[00:12:34] Speaker 01:
That's the easiest way to do it.

[00:12:36] Speaker 01:
Just as Judge Stoll asked, what is this directed to?

[00:12:39] Speaker 01:
That's the step one question.

[00:12:41] Speaker 01:
I think the district court kind of took an overly abstract view of this and said, well, it uses a mathematical equation, therefore it's directed to the mathematical equation.

[00:12:50] Speaker 01:
No, it's directed to the specific

[00:12:53] Speaker 01:
Process and so we think like in Thales and they'll recognize that deer although it predated the alice step one So, you know, okay.

[00:13:03] Speaker 01:
So just to finish that thought although deer predated the alice step one step two inquiry It drew on deer and said while it's not limited to step one It certainly speaks a lot towards step one and that's what we think is going on here and

[00:13:18] Speaker 01:
I'm happy to talk about why this is not even a close case under step two, but maybe I'll save that for rebuttal if that comes up.

[00:13:26] Speaker 01:
Thank you, Your Honor.

[00:13:41] Speaker 02:
Good morning, Your Honors, and may it please the Court.

[00:13:44] Speaker 02:
I think I'm just going to jump right into it.

[00:13:46] Speaker 02:
Council on the other side started with the raised judicata issue, so I will speak up a little bit Sure sure your honors asked first about the Gillard case I think as XY's counsel here's has conceded.

[00:13:59] Speaker 02:
They didn't appeal that issue.

[00:14:01] Speaker 02:
That's not before the court Council for XY talked about the simple air decision and

[00:14:08] Speaker 02:
Um, simple error does not, contrary to what XY's counsel says it does, it does not actually require a claim by claim comparison.

[00:14:17] Speaker 02:
It does not say that.

[00:14:18] Speaker 02:
Simple error actually says that its holding is expressly limited to one issue, and that was whether it was reversible error for the district court in that case to hold that the mere filing of a terminal disclaimer was dispositive on the issue of residue caught in.

[00:14:34] Speaker 02:
It found that, yes, simply filing a terminal disclaimer and holding that that alone

[00:14:42] Speaker 02:
warranted a finding of patentable indistinctness, that was a reversible error.

[00:14:47] Speaker 02:
But simple error does not say that a claim-by-claim comparison or a detailed comparison is required in every case.

[00:14:53] Speaker 02:
In fact, it says the opposite.

[00:14:54] Speaker 02:
It actually refers back to the Send You case.

[00:14:58] Speaker 00:
In the blue brief at 43, XY says, and your friend has argued, that the district court never compared the claims of the patents that were dismissed as precluded with claims of the 2012 loss

[00:15:12] Speaker 00:
In the appendix at seven, the district court says that it needed to address whether, one, whether XY was in a position to assert the patents at the time of the prior lawsuit, and two, whether the claims asserted were material or the same.

[00:15:28] Speaker 00:
It doesn't look like the district court addressed the materiality.

[00:15:32] Speaker 00:
Isn't that a reversible error?

[00:15:35] Speaker 02:
Well, I think what the district court held is it actually does say that if it finds that the claims in the second case are the same or substantially the same as the claims in the first case, then it can find that they're patently distinct or materially distinct.

[00:15:53] Speaker 02:
It does not do a detailed claim-by-claim comparison.

[00:15:57] Speaker 02:
And I would say that with respect to the 769 patent, that is not required.

[00:16:02] Speaker 02:
And I think XY's counsel here today essentially conceded that rather than remand this case back to the district court to have it do a claim-by-claim comparison, this court is perfectly competent to do that analysis itself.

[00:16:14] Speaker 02:
With respect to the 769 patent, I would invite this court to do that analysis because there is no difference between the 769 patent claims and the two earlier asserted reverse sort patent claims save for one distinction, which is the earlier patents say collect and freeze the sperm cells, whereas the 769 patent says thaw cells that have already been frozen.

[00:16:40] Speaker 02:
Is there a material distinction between collecting, freezing, and thawing versus thawing previously frozen cells?

[00:16:48] Speaker 02:
No.

[00:16:49] Speaker 02:
I think that's readily apparent on the face of the claims.

[00:16:52] Speaker 02:
And Senju says explicitly that if it's readily apparent that there's no material difference between the claims of the first suit and the claims of the second suit, there's no need for a detailed comparison.

[00:17:03] Speaker 02:
So certainly with respect to that patent, I would suggest that there's no need to remand that, that the court was within its rights to hold that there was no difference.

[00:17:11] Speaker 02:
And as Judge Stahl stated earlier in the day, this court sits to review judgments, not opinions.

[00:17:18] Speaker 02:
So whether the opinion was perfect,

[00:17:20] Speaker 02:
is not the issue.

[00:17:22] Speaker 03:
Is it your view that this court can do that side-by-side race judicata analysis and not have to go back to the trial court?

[00:17:34] Speaker 02:
Certainly this court is competent to perform that analysis.

[00:17:41] Speaker 02:
If any court in this country is, it's this court.

[00:17:44] Speaker 02:
And with respect to the 769 patent, as I mentioned... How about the others?

[00:17:49] Speaker 02:
With the others, I mean, I would acknowledge.

[00:17:50] Speaker 03:
We're not going to cherry pick it and do the one you want.

[00:17:53] Speaker 03:
If we do any of them, we'd have to do all of them.

[00:17:56] Speaker 02:
Well, I don't know that there's a rule that all of them would have to be remanded.

[00:18:00] Speaker 02:
I think it would still save judicial resources if this court said we're perfectly competent to affirm the district court with respect to the 769 patent, if the court were inclined to remand the other two patents back down in light of simple error and say it would be beneficial to us if the court had conducted

[00:18:18] Speaker 02:
Claim-by-claim comparison, so we're going to remand those Patents back down to the district court to do that analysis that certainly wouldn't be unreasonable I do think it would be a waste of judicial resources to do that with respect to the 769 patent when it is so readily apparent from the face of the claims that it claims pretty much the exact point okay

[00:18:39] Speaker 02:
The last point that I would make on the res judicata, and specifically with respect to the distinction that XY's council tries to draw out between the 769 patent and the earlier patents, they say the collecting and freezing steps are materially distinct.

[00:18:57] Speaker 02:
Because in theory, a competitor could structure its business operations so as to avoid infringing the first set of patents by not collecting or freezing, but not avoid infringing the 769 patent.

[00:19:10] Speaker 02:
As a practical matter, that has been tested.

[00:19:13] Speaker 02:
TransOVA doesn't collect or freeze sperm cells, and we were found to have infringed those claims.

[00:19:19] Speaker 02:
So just as a practical matter, that argument just doesn't work.

[00:19:22] Speaker 02:
But more fundamentally,

[00:19:25] Speaker 02:
That argument ignores the important issue here, which is the scope of the claims.

[00:19:31] Speaker 02:
It's not the number of entities that might infringe a particular claim.

[00:19:36] Speaker 02:
It is the scope of that claim itself.

[00:19:39] Speaker 02:
And XY's argument would be akin to saying that there is a material distinction between, for example, a claim that says, operate machine X, and a claim that says, turn on and operate machine X.

[00:19:51] Speaker 02:
Is there a material distinction between those two claims?

[00:19:53] Speaker 02:
No.

[00:19:54] Speaker 02:
Could they, in theory, be asserted against different infringing entities?

[00:19:58] Speaker 02:
In theory, they could.

[00:20:00] Speaker 02:
But there's no material distinction between those claims, just as there is no material distinction between thawing a frozen cell sample and collecting, freezing, and thawing that same sample.

[00:20:12] Speaker 02:
With that, I'll turn to the 101 issue.

[00:20:18] Speaker 02:
It's probably more efficient if I just go through some of the points that I heard counsel make and address those points.

[00:20:26] Speaker 04:
Can I ask you just my same initial question that I asked your opposing counsel, which is that the court held that the claims are directed to the mathematical equation that permits rotating multi-dimensional data.

[00:20:41] Speaker 04:
Do you agree with that?

[00:20:44] Speaker 02:
Yes.

[00:20:47] Speaker 02:
There are a lot of conventional elements.

[00:20:50] Speaker 04:
I mean, this claim is chock full of- We're supposed to look and decide what's conventional and not conventional when we decide what a claim is directed to?

[00:20:57] Speaker 02:
No, no.

[00:20:57] Speaker 02:
But I'm simply pointing out that even XY doesn't dispute that everything in this claim was known in the prior, with one exception according to them.

[00:21:07] Speaker 02:
And that is the use of rotation math to sort

[00:21:12] Speaker 02:
particles in real time.

[00:21:14] Speaker 04:
Again though, you're saying that this court, when it looks at what a claim is directed to, which is really more akin to a claim construction exercise.

[00:21:22] Speaker 04:
What is the claim directed to?

[00:21:25] Speaker 04:
We're supposed to consider private art or whether individual steps are known or not.

[00:21:30] Speaker 04:
I mean, we're supposed to look at whether it's directed to an abstract idea, whether it's directed to a natural law,

[00:21:36] Speaker 04:
whether it's directed to a mathematical equation, which might be an abstract idea.

[00:21:41] Speaker 04:
Of course, there's cases that say you can use a mathematical equation in a actual application.

[00:21:46] Speaker 04:
Just because you have math, like for example in Thales, just because you have math doesn't mean that it's directed to an abstract idea.

[00:21:53] Speaker 04:
So I'm questioning your promise of I'm supposed to just ignore the other elements of the claim.

[00:22:01] Speaker 04:
because they're admittedly known as individual elements.

[00:22:06] Speaker 02:
I'm not asking you to ignore them, and I'm not asking you to make any independent determination as to which ones are in the prior.

[00:22:12] Speaker 02:
It's uncontested.

[00:22:13] Speaker 02:
It is uncontested that everything in the claim is in the prior.

[00:22:17] Speaker 00:
Your friend said that use of the pulsed laser

[00:22:21] Speaker 00:
repeatedly was not in the priority.

[00:22:23] Speaker 00:
Is that correct?

[00:22:24] Speaker 02:
Well, that's with respect to the res judicata issue and one of the patents.

[00:22:28] Speaker 02:
It's not applicable to the 559 patent.

[00:22:31] Speaker 02:
All right.

[00:22:33] Speaker 02:
So you're asking, what is that invention directed to?

[00:22:36] Speaker 02:
It is directed to using math to sort particles in real time.

[00:22:41] Speaker 02:
That's what it's directed to.

[00:22:42] Speaker 04:
And I heard it's not directed to the mathematical equation alone.

[00:22:47] Speaker 02:
Well, it's directed to that mass amount of equation.

[00:22:51] Speaker 04:
Using mass to in order of certain particles in a flow cytometer.

[00:22:54] Speaker 04:
Sure, yes.

[00:22:58] Speaker 02:
Council likened the claim to the one in deer.

[00:23:02] Speaker 02:
There's a very big difference between this claim and the claim at issue in deer.

[00:23:08] Speaker 02:
That claim actually resulted in a novel product.

[00:23:12] Speaker 02:
And the court took pains to make that point.

[00:23:14] Speaker 02:
And it said it resulted in a synthetic, cured, molded product, a result heretofore unknown in the art.

[00:23:22] Speaker 02:
That is not what we have here.

[00:23:24] Speaker 02:
There is no new product.

[00:23:27] Speaker 02:
The claim ends with the sorting of particles, which is the exact same result as the PriorArt method.

[00:23:33] Speaker 04:
How do you square what you're saying with Dear's express statement that you're not going to look at PriorArt and consider 102 and 103 in your analysis of 101?

[00:23:44] Speaker 04:
I mean, it does expressly say that.

[00:23:47] Speaker 02:
Sure.

[00:23:48] Speaker 02:
And there are several cases, I think, that maybe say the opposite.

[00:23:52] Speaker 02:
I mean, you could contrast deer.

[00:23:54] Speaker 04:
Just focusing on deer.

[00:23:55] Speaker 04:
Sure.

[00:23:56] Speaker 02:
So I don't think you have to look at the priority.

[00:23:59] Speaker 02:
I mean, I think you can just look at the mathematical formula in this context, in the context of this claim.

[00:24:05] Speaker 02:
Their entire argument

[00:24:07] Speaker 02:
built and council said it repeatedly today their entire argument is premised on that mathematical formula leading to an improved result an improved result and if you if they had support for that if they actually showed an improvement in the specification that Might be a good argument it it would be a better argument though if they actually claimed it they don't claim that the claims don't recite a better result the claims don't recite a

[00:24:33] Speaker 02:
Increased accuracy or improved security.

[00:24:36] Speaker 04:
Does the specification say that it's improved?

[00:24:39] Speaker 02:
No, it does not.

[00:24:40] Speaker 02:
It does not.

[00:24:41] Speaker 02:
What the specification says at every turn is that the use of rotation math may lead to better results.

[00:24:48] Speaker 02:
It's not even definitive as to whether it does lead to better results.

[00:24:52] Speaker 02:
It may lead to better results.

[00:24:54] Speaker 02:
Why does it say it may?

[00:24:55] Speaker 02:
Why is it permissive?

[00:24:57] Speaker 02:
Because they had no results to back that up.

[00:24:59] Speaker 02:
They had zero results.

[00:25:00] Speaker 02:
The only data, the only rotated data disclosed in the patent is in figures five and six.

[00:25:06] Speaker 02:
And if you look at the inventor's description of those figures, it says,

[00:25:09] Speaker 02:
This is rotated data.

[00:25:12] Speaker 02:
They conspicuously do not characterize that data.

[00:25:15] Speaker 02:
They don't say it shows cleaner separation of the particle data.

[00:25:19] Speaker 02:
It shows increased purity of the particle populations.

[00:25:22] Speaker 02:
They don't characterize it at all because it actually, in fact, doesn't show any of those things.

[00:25:27] Speaker 02:
If you actually look at the particle data, it's not that well separated.

[00:25:31] Speaker 02:
It's not even as well separated as the prior art data that's disclosed in Evans figure 10.

[00:25:37] Speaker 02:
So that may very well be why they don't recite it in the claims and why they don't even definitively say anywhere in the specification.

[00:25:45] Speaker 04:
So in step one, you would have me look at prior to see whether they're a patent owner suggestion that something is actually an improvement or not is actually an improvement.

[00:25:57] Speaker 02:
I don't know that that is appropriate in step one.

[00:25:59] Speaker 02:
I think in step one, we're just assessing whether the invention as a whole is directed to an abstract concept.

[00:26:04] Speaker 02:
I think the answer here is yes for the reasons I've explained.

[00:26:07] Speaker 02:
I think once you move into step two and you're looking at whether or not the invention as a whole is directed to a quote unquote inventive concept, then I think it's appropriate at that point to look at what's come before, to look at what is conventional.

[00:26:20] Speaker 02:
And again, and this is important, they've conceded every step of the claim is known in the prior art.

[00:26:27] Speaker 03:
This decision was made, if I understand it correctly, on a 12C motion, judgment on the pleading.

[00:26:37] Speaker 03:
So there was no evidentiary basis for looking at the prior art, was there?

[00:26:44] Speaker 02:
Well, I mean, certainly- Yes or no?

[00:26:46] Speaker 02:
No.

[00:26:47] Speaker 03:
Thank you.

[00:26:48] Speaker 02:
There was an evidentiary basis to look at the patent specification at issue, the 559 patent specification.

[00:26:54] Speaker 03:
The written description.

[00:26:55] Speaker 02:
Yes, which discloses Evans, specifically, and says- Is it the right Evans?

[00:27:01] Speaker 04:
Because I'm going to think if you look at the patent number, you'll see it's not the Evans that you're relying on.

[00:27:06] Speaker 04:
I believe it is the same- The patent discloses a different patent.

[00:27:10] Speaker 02:
I believe it discloses the same specification, Your Honor, and it discloses-

[00:27:13] Speaker 02:
In particular, the 559 patent specifically discloses the use of compensation algorithms, quote, as someone skilled in the art would appreciate.

[00:27:24] Speaker 02:
All right, that's a quote from the patent.

[00:27:26] Speaker 02:
It's talking about the compensation algorithms specifically disclosed in Evans.

[00:27:30] Speaker 02:
That also disclosed math to sort particles in the exact same way that this claim is to math to sort particles.

[00:27:39] Speaker 02:
It's just a slightly different math.

[00:27:41] Speaker 02:
And the question is, do you want to reward XY

[00:27:43] Speaker 02:
for relying on a totally conventional, well-known mathematical algorithm and substituting that algorithm for the other conventional well-known algorithm, which was the compensation algorithm.

[00:27:55] Speaker 02:
And you want to now reward them with a patent on having done that.

[00:27:59] Speaker 02:
Maybe, maybe, if they've claimed it, if they've recited it in the claims, or if they've described it in the specification, it's not in the claim.

[00:28:10] Speaker 02:
As I said, it's also not the specification.

[00:28:12] Speaker 04:
I just want to point something out, which is you're talking about rewarding them with a patent when somebody else has come up with something.

[00:28:17] Speaker 04:
I mean, that sounds more like 102, 103, doesn't it?

[00:28:21] Speaker 04:
I mean, this isn't over.

[00:28:23] Speaker 04:
This is at the 12C stage, right?

[00:28:25] Speaker 02:
Right, well, I think it's important maybe to look at the Berkheimer case, which I think is extremely instructive.

[00:28:31] Speaker 02:
There were two sets of claims.

[00:28:32] Speaker 02:
Do that in 10 seconds.

[00:28:33] Speaker 02:
Go ahead.

[00:28:34] Speaker 02:
Claims 1 through 3 were struck down specifically because they did not recite the alleged improvement.

[00:28:40] Speaker 02:
Claims 4 through 7, there was determined to be a material issue of fact because the court found that they did recite the alleged improvement.

[00:28:48] Speaker 02:
And maybe, not definitively, but maybe that was sufficient to state an inventive concept.

[00:28:52] Speaker 02:
And so remanded.

[00:28:54] Speaker 02:
Back to the district court on those claims, but on claims one through three, it did not.

[00:28:58] Speaker 02:
It struck those down because that alleged improvement was nowhere in the claims.

[00:29:02] Speaker 02:
Same as here.

[00:29:04] Speaker 04:
I just want to point out one thing, which is that I'm not sure the specifications are the same.

[00:29:08] Speaker 04:
You can look at that, but I'm not sure they are.

[00:29:10] Speaker 04:
I don't think I agree with you.

[00:29:11] Speaker 04:
You can look at them.

[00:29:22] Speaker 00:
You have two and a half minutes sure your honor.

[00:29:24] Speaker 01:
Thank you Just a few quick points on each issue on race judicata just two points simple air does in fact say unequivocally obviously you're capable of reading the decision at 1168 claim preclusion analysis Analysis requires comparing the patent claims.

[00:29:40] Speaker 01:
That's an exact quote it then carves out the special re-examination context which is not at issue here

[00:29:47] Speaker 01:
Second, Judge Wallach, you're exactly right.

[00:29:49] Speaker 01:
The district court opinion has two parts to its opinion.

[00:29:53] Speaker 01:
The first is could they have been brought.

[00:29:54] Speaker 01:
That's when they analyze the three patent claims that we're talking about in race judicata.

[00:29:59] Speaker 01:
It then has a second, essentially the same or materially different section.

[00:30:04] Speaker 01:
There, it analyzes only the 822 patent, which is not at issue on this appeal.

[00:30:09] Speaker 01:
None of the three patents here.

[00:30:10] Speaker 01:
So at a minimum, it's a vacated remand under simple error.

[00:30:13] Speaker 01:
On the section 101 argument, my friend on the other side talks about new product being the distinction between deer and this case.

[00:30:24] Speaker 01:
That's a distinction without a difference.

[00:30:25] Speaker 01:
In deer, you had better cured rubber as the new product.

[00:30:29] Speaker 01:
Here, you have better sorted product as the new product.

[00:30:33] Speaker 01:
And in deer, the claim itself, deer reprints the claim.

[00:30:37] Speaker 03:
What about the fact that you said may happen?

[00:30:41] Speaker 03:
rather than will happen.

[00:30:43] Speaker 03:
Does that matter?

[00:30:44] Speaker 01:
No, Your Honor.

[00:30:45] Speaker 01:
It certainly does not matter for step one as to whether it's directed to an industrial process that is sorting outcomes.

[00:30:54] Speaker 01:
All of their arguments, which was my second point, go to step two.

[00:30:57] Speaker 01:
Was there really an improvement?

[00:31:00] Speaker 01:
Which is an odd question to be asking on a 12C motion.

[00:31:03] Speaker 01:
We don't think you need to even get there because this is clearly a step one case and it can end right there.

[00:31:09] Speaker 01:
But if there was any doubt about that under step two, the specification, I'll read you the passages and there are a number of them.

[00:31:16] Speaker 01:
It does use the word may, but it clearly talks about the rotational algorithm leading to improved sort outcomes on column seven, line 17 through 20.

[00:31:25] Speaker 01:
One method of gaining spatially separated data may be to use compensation algorithms, that's the analog in the Evans patent that he's talking about, as those skilled in the art could appreciate.

[00:31:36] Speaker 01:
Rotation of the data, forward scatter versus side scatter, may be a more

[00:31:41] Speaker 01:
accurate mechanism to do this.

[00:31:43] Speaker 01:
And then there's several other passages in the specification that talk about, unlike conventional methods, this one may lead to better sort outcomes.

[00:31:53] Speaker 01:
But again, Your Honor, those are all step two arguments in which you can have a battle of experts and all that, but we don't even get there in this case.

[00:32:03] Speaker 01:
And the last point I would make is

[00:32:05] Speaker 01:
The arguments that they're making as to whether this is a material advancement or not, again, step two, obviousness and novelty.

[00:32:13] Speaker 01:
They're welcome to bring those arguments at a later stage in this case.

[00:32:17] Speaker 01:
Thank you, Your Honor.

[00:32:18] Speaker 01:
Thank you, Counsel.