[00:00:01] Speaker 00:
The next case is Sight Sound Technologies versus Apple, Incorporated, 2015, 1159.

[00:00:09] Speaker 00:
Mr. Wolfe.

[00:00:12] Speaker 04:
Thank you, Your Honor.

[00:00:13] Speaker 04:
May it please the Court, Matthew Wolfe, for Sight Sound.

[00:00:17] Speaker 04:
Apple brought eight grounds in its petition.

[00:00:22] Speaker 04:
At the end of the day, all eight grounds were rejected.

[00:00:26] Speaker 04:
Yet we stand before you today with invalid claims

[00:00:30] Speaker 04:
based on a final written decision that is rife with both substantive and procedural errors, and those errors are entirely interrelated.

[00:00:40] Speaker 04:
Recognizing I should probably tread somewhat gingerly in quoting Versada, Versada told us that a final written decision can be reviewed for compliance with the limit on- Versada has nothing to do with whether an issue not raised by the party can be considered by the board.

[00:00:55] Speaker 01:
It has to do, it does support you,

[00:00:58] Speaker 01:
on whether you can appeal the question of whether it's a covered business method patent, but it does not support you on the issue of whether the board went beyond the assertions made by the requester.

[00:01:14] Speaker 04:
Respectfully, Your Honor, 35 USC 322 and 37 CFR 42208 circumscribe the board's invalidation authority in the CBM context.

[00:01:26] Speaker 04:
And Versada tells this court that it can review issues that go to the ultimate invalidation authority.

[00:01:33] Speaker 05:
But that argument proves a little bit too much, doesn't it?

[00:01:35] Speaker 05:
Because any kind of limitation on the board's authority to initiate is also in some ways a limitation to authority to invalidate.

[00:01:47] Speaker 05:
So that can't be what Versada meant.

[00:01:49] Speaker 04:
Your Honor, we have... Let me ask you this.

[00:01:52] Speaker 05:
Yes.

[00:01:52] Speaker 05:
Are you familiar?

[00:01:53] Speaker 05:
I know it came out after the briefing here, but with our recent Acadia decision.

[00:01:57] Speaker 05:
I am, Your Honor.

[00:01:58] Speaker 05:
Why doesn't that place Versada properly in context here and recognize that the CDM requirement is a special requirement that can be reviewed at the later stage?

[00:02:09] Speaker 05:
Because it goes overall to whether there's a whole class of patents that the board can review or not.

[00:02:16] Speaker 05:
But once it gets into the specific case-by-case decisions,

[00:02:19] Speaker 05:
on whether it meets certain requirements, those specific case-by-case decisions are not reviewable.

[00:02:26] Speaker 04:
Understood, Your Honor.

[00:02:27] Speaker 04:
And I read a Cady's, at least implicitly, to talk about a continuum of decisions that the PTAB can make.

[00:02:33] Speaker 04:
On one hand, we have things that are procedural, that go to, in that case, the time limit, that are within its ordinary course.

[00:02:42] Speaker 04:
But here we have a statutory regime.

[00:02:43] Speaker 04:
And let me just start with a specific example that I think is unique to this case, which is the estoppel provision of CBM.

[00:02:49] Speaker 04:
The estoppel provision of the CBM statute requires a petition for CBM or precludes further litigation for a ground that has been brought.

[00:03:01] Speaker 04:
Not that could have been brought, has been brought.

[00:03:04] Speaker 04:
If what the PTAP did in this case is allowed, it makes a hash out of that provision.

[00:03:09] Speaker 04:
Because now if a party says, oh, the name of a prior art reference,

[00:03:13] Speaker 04:
Well, does that mean that if they only talked about Section 102 that any discussion of 103 or 112 or 101 based on that or an analogous reference is now off the table?

[00:03:25] Speaker 04:
You can actually imagine the plaintiff coming in the reverse situation where someone said, hey, I didn't raise this.

[00:03:32] Speaker 04:
Why is it being held against me in a district court?

[00:03:34] Speaker 04:
I was only arguing 102, not 103.

[00:03:37] Speaker 04:
The Board of Suisse-Ponte raised 103.

[00:03:40] Speaker 04:
I never suggested it.

[00:03:41] Speaker 04:
Why am I stopped?

[00:03:43] Speaker 00:
Mr. Walton might move back a little bit.

[00:03:45] Speaker 00:
Oh, I'm sorry, Your Honor.

[00:03:47] Speaker 04:
I apologize, Your Honor.

[00:03:49] Speaker 04:
I've been told to be quiet more than once.

[00:03:53] Speaker 04:
The estoppel regime is part of the entirety of the regime.

[00:03:57] Speaker 04:
We start with 322A3 that says that the petition has to identify, in particularity, each claim challenged, the grounds, and the information.

[00:04:06] Speaker 05:
You're trying to set up this distinction between procedural and merits things, I think.

[00:04:11] Speaker 05:
But if that's the case, why weren't the kind of requirements at issuing QOZO also on the merit side the way you're portraying them?

[00:04:19] Speaker 04:
Because no significant due process concerns are implicated by someone being a year or a year and a day late.

[00:04:26] Speaker 01:
That's not what QOZO was about.

[00:04:29] Speaker 04:
Understood, Your Honor, but he was talking about Acadies as I understood the question.

[00:04:32] Speaker 01:
No, he asked about QOZO.

[00:04:33] Speaker 04:
In QOZO, first of all, QOZO does not have the same estoppel implications because there's a different estoppel regime with IPRs than there are with CBMs.

[00:04:41] Speaker 04:
And so that is a very significant difference between Quozo and the facts at issue here.

[00:04:47] Speaker 04:
Secondly, it is unambiguous under 37 CF-442-208 that the only discretion the P-TEB has is to rule on, to decide on issues raised in the petition.

[00:04:59] Speaker 04:
If an issue is not raised in the petition, they have no authority.

[00:05:02] Speaker 04:
They have no legal authority to talk about.

[00:05:05] Speaker 05:
I see very little difference between that scenario and the Quozo scenario where the statute said,

[00:05:11] Speaker 05:
You can only initiate review based upon the art cited.

[00:05:15] Speaker 05:
And the court said, even though the art wasn't cited, the court could still go ahead.

[00:05:21] Speaker 04:
Your honor, if we, well, first of all, we have to talk about Quozo in light of Versada, and Versada specifically talks about... Well, if you're reading a distinction or a conflict between Quozo and Versada, then Quozo governs, does it not?

[00:05:37] Speaker 04:
Except, well, QOZO, Versado specifically says that there's no conflict.

[00:05:41] Speaker 04:
It says that QOZO didn't raise the issue.

[00:05:43] Speaker 05:
Right, and Katie's made that very clear by saying the whole point of it is all these procedural limitations on the board's initiation fall in the no review camp.

[00:05:53] Speaker 05:
And it's only the special CBM requirement, which refers to a whole class of patents that is reviewable after initiation.

[00:06:01] Speaker 04:
And, Your Honor, we can start with the 324E question, and what is and is not reviewable.

[00:06:06] Speaker 04:
And obviously, there's a lot of collateral activity on Quozo and Versada that may or may not affect what we're talking about in the coming months.

[00:06:13] Speaker 04:
But in this particular case, there can be no dispute that 322 says that the petitioner must list with particularity.

[00:06:21] Speaker 04:
And then, very importantly, Your Honors, in EPICOR, the PTAB itself defined what constituted a satisfaction of the 322A3 standard.

[00:06:31] Speaker 04:
It told us what you had to do to raise obviousness sufficiently for it to be considered.

[00:06:36] Speaker 04:
in terms of identifying which prior art, motivation to combine, et cetera.

[00:06:41] Speaker 04:
Here we know that standard was met because the words 103 and Compus Sonics were never mentioned in the same section of the opinion.

[00:06:48] Speaker 04:
So the very standard the PTAB laid out for meeting 322, it refused to apply to itself.

[00:06:57] Speaker 04:
It said, we can raise this sua sponte after the fact.

[00:07:01] Speaker 04:
In fact, Your Honor... Did you get an opportunity to respond?

[00:07:05] Speaker 04:
No, because the final written decision came up with a ground for combination that was never raised by Apple, never articulated by any of the experts in this case.

[00:07:14] Speaker 01:
Essentially, and why don't we skip to... I thought the board advised you about that issue and the decision to initiate.

[00:07:21] Speaker 04:
No, Your Honor, not the... So what the board found in its final written decision was it would have been obvious for one... Now, again, there are all kinds of problems with the final written decision and not identifying which references are to be combined, but put that aside for the moment.

[00:07:34] Speaker 04:
What it said in its final written decision was it would have been obvious for someone to take a hard drive and swap it out for the removable media that was in the prior art.

[00:07:44] Speaker 04:
It did that based on no expert.

[00:07:46] Speaker 04:
In this case, no expert explains why it would have been obvious to use a hard drive to store music purchased over the internet.

[00:07:55] Speaker 04:
That evidence just doesn't exist in this record.

[00:07:57] Speaker 04:
The board just said

[00:07:58] Speaker 04:
Well, we think it was obvious.

[00:08:00] Speaker 04:
We think it could have been swapped out.

[00:08:01] Speaker 01:
No, the prior art reference itself spoke about using a hard drive to store under certain circumstances.

[00:08:07] Speaker 04:
Not in the context of the claim, though.

[00:08:09] Speaker 04:
As Your Honor well knows, when you're talking about combination, and KSR tells us, the question is not is it obvious to look at any individual piece, any particular limitation of a claim.

[00:08:18] Speaker 04:
The question is the claim as a whole in its context.

[00:08:21] Speaker 04:
And most of the people in this room can't remember a time when you couldn't download music onto a hard drive over the internet.

[00:08:28] Speaker 04:
But Mr. Hare, in the mid-80s, thought of it.

[00:08:31] Speaker 04:
It's so now ubiquitous that the PTAB said, we, on our own, are going to supply evidence that this would have been obvious.

[00:08:38] Speaker 04:
Even Apple's experts wouldn't go that far.

[00:08:41] Speaker 04:
Their experts wouldn't say, in light of the market paradigms, in light of the pressures, in light of the biases in the technology, in the industry, it would have been obvious to take a hard drive and use that instead of CDs or cassettes.

[00:08:54] Speaker 04:
There's no record evidence of that, and that didn't come out until the final written decision.

[00:08:58] Speaker 04:
So even if our surreply, which of course is a terribly thin read to try to wash something clean with, to mix my metaphors horribly, even if that were sufficient, you can't surreply to something that comes after the fact.

[00:09:15] Speaker 04:
So let's turn now to the other problem with the obviousness determination, which is secondary considerations.

[00:09:20] Speaker 04:
And particularly in a case like this where the patented issue is, and let me be clear, it is revolutionary.

[00:09:28] Speaker 04:
Mr. Hare invented iTunes a decade before it hit the market.

[00:09:32] Speaker 04:
He sold the first song over the internet.

[00:09:35] Speaker 04:
They sold the first movie over the internet.

[00:09:37] Speaker 04:
This is not a troll.

[00:09:38] Speaker 04:
This is not someone that bought a patent and thought after the record.

[00:09:41] Speaker 04:
We'll try to figure out some way to apply it.

[00:09:43] Speaker 00:
Didn't the board find evidence that iTunes arose from a lot of other sources?

[00:09:49] Speaker 04:
They did it based on a declaration of a witness who admitted he hadn't even looked at the claims of the patent.

[00:09:54] Speaker 04:
This is Mr. Robin.

[00:09:56] Speaker 01:
He hadn't even looked at the claims of the patents he was listing, let alone whether they had any... Because he didn't look at the claims his declaration gets thrown in the trash?

[00:10:04] Speaker 04:
We're talking about a substantial evidence standard here.

[00:10:07] Speaker 04:
I mean, just to give you an example, Your Honor, they cited the board, PTAP cited the genius feature as one of the reasons iTunes was successful.

[00:10:14] Speaker 04:
The Genius feature came out five years after iTunes was released.

[00:10:18] Speaker 01:
How about music licensing?

[00:10:19] Speaker 01:
That was something that was in iTunes from the beginning, right?

[00:10:22] Speaker 04:
And, Your Honor, that only supports our position.

[00:10:24] Speaker 04:
The reason SightSound did not succeed is because at the time, SightSound was affiliated with Microsoft, which had 90% of the computer market.

[00:10:33] Speaker 04:
The record companies did not want to license to someone that might actually kick them out of tower records in the Virgin Megastore.

[00:10:39] Speaker 04:
So they licensed to this tiny little company called Apple that everybody thought was going to fail to get the antitrust regulators off their back.

[00:10:45] Speaker 04:
The case law we cite in our brief makes clear that the limitation on access to raw materials, which is just what this is, that that doesn't indicate no commercial success.

[00:10:55] Speaker 04:
To the contrary, Apple got the license.

[00:10:57] Speaker 04:
They were successful with our invention.

[00:10:59] Speaker 04:
That is the secondary consideration that should have been considered.

[00:11:02] Speaker 04:
And it's particularly troubling that the board reached the decision it could when it said, we haven't proven secondary considerations after they denied us the very discovery we sought.

[00:11:12] Speaker 04:
We sought discovery from Apple saying, tell us why iTunes was successful.

[00:11:17] Speaker 04:
And Apple said, we're not going to give it to you.

[00:11:18] Speaker 04:
And the board said, that's fine.

[00:11:20] Speaker 04:
You don't have to give it to them.

[00:11:21] Speaker 04:
And then the board said, oh, by the way, we're going to find no secondary considerations because you haven't proven why Apple's iTunes was successful.

[00:11:28] Speaker 00:
Wolf you wanted to yes, please.

[00:11:31] Speaker 00:
Yes, thank you.

[00:11:33] Speaker 04:
Thank you.

[00:11:40] Speaker 02:
Thank you, your honor.

[00:11:41] Speaker 02:
May it please the court.

[00:11:45] Speaker 02:
On behalf of the PTO, I will address two procedural issues this afternoon before turning it over to Apple to address the board's patentability decision.

[00:11:53] Speaker 05:
Why doesn't resting the ability decision

[00:11:57] Speaker 05:
on a ground that wasn't raised at all, an ultra-virus act?

[00:12:03] Speaker 02:
Your Honor, the reason is, first of all, I would argue that even though the petition itself did not use the word obviousness or didn't use the word sites of statutory section 103, it did on its face support a potential unpatentability ground of obviousness.

[00:12:25] Speaker 00:
That's sort of weak language.

[00:12:27] Speaker 00:
Support and potential.

[00:12:31] Speaker 05:
I would disagree, Your Honor, and the reason is because the... Let me ask that question again, because you're... I mean, not intentionally, but that you're not answering it the way I intended it to be posed.

[00:12:44] Speaker 05:
Let's assume that the petition didn't raise it at all.

[00:12:48] Speaker 05:
Let's not get into the fact.

[00:12:50] Speaker 05:
If the petition we find didn't raise it at all,

[00:12:54] Speaker 05:
why isn't the board's consideration of different grounds fit in with the line of ultramirals cases?

[00:13:02] Speaker 02:
If the petition itself in no way raises a certain ground of unpatentability, I would agree that that's probably a line where we would draw between where the board could institute and where it couldn't.

[00:13:16] Speaker 02:
I would agree that there must be some sort of basis

[00:13:19] Speaker 02:
in the facts of the petition and the evidence that's submitted with the petition for the board to be able to determine that it's more likely than not that a certain ground of unpatentability can go forward to trial.

[00:13:31] Speaker 02:
In here, Apple's petition clearly did that.

[00:13:35] Speaker 02:
It's clearly on the side of supporting the ground of obviousness.

[00:13:41] Speaker 02:
Apple submitted about 15 pieces of prior art.

[00:13:43] Speaker 05:
If I'm hearing you right, some of these limitations

[00:13:48] Speaker 05:
in the statute, if they violate them, are reviewable, some of them aren't.

[00:13:54] Speaker 05:
We held one in Cozo wasn't, we held one in Versado was, we held another one in Acadies wasn't.

[00:14:02] Speaker 05:
Do you have any reason, distinction for where we should draw that line?

[00:14:06] Speaker 02:
I'm sorry, Your Honor, I just didn't hear the question.

[00:14:09] Speaker 05:
I'm trying to figure out, because you seem to be conceding that there's something more than just the CBM determination that can be reviewable on final appeal, but I have no understanding where whatsoever we're going to draw that line.

[00:14:23] Speaker 05:
When in Closa we found one section wasn't reviewable, in Versado we found the CBM was, in Acadies we found the time limit wasn't reviewable.

[00:14:35] Speaker 05:
I mean, are we just going to have to go one by one through these cases and decide, well, that one looks close enough.

[00:14:40] Speaker 05:
We'll review it.

[00:14:40] Speaker 05:
This one doesn't look close enough.

[00:14:42] Speaker 05:
We won't.

[00:14:43] Speaker 01:
Well, I would agree with your honor that if... Why isn't the distinction that if you could have framed the petition to cover this and you could have done it in a timely way, that under those circumstances, those kinds of errors aren't reviewable in a final judgment?

[00:15:03] Speaker 02:
I would agree with that.

[00:15:04] Speaker 02:
Enquoto sets forth the proper petition standard.

[00:15:08] Speaker 02:
Versada does not question the proper petition standard.

[00:15:12] Speaker 05:
Here, there's no doubt that... That's because in Versada, no matter what they would have done, if it's not a CBN patent, it's not a CBN patent, so you can't fix it.

[00:15:22] Speaker 02:
That is what Versada held.

[00:15:23] Speaker 02:
That's correct.

[00:15:24] Speaker 01:
And so if Versada... And you can't distinguish on that ground, on whether it's a CBN patent, you can't distinguish Versada from this case.

[00:15:33] Speaker 01:
Would that be correct?

[00:15:36] Speaker 02:
uh... i on the factor on the on the i don't want to confuse you i'm talking just about question cbm pat the second grant there's no distinction between this case and personal on background opposed to the other grant talking i i would agree it to the first round of the weather the patented cbm patent uh... it first out of here first i would have what would control and but i would also agree that it can be cabin specifically to whether it hadn't even cbm pat

[00:16:05] Speaker 01:
As to whether a patent is a CBM patent, you argue in your brief for Chevron deference, correct?

[00:16:11] Speaker 01:
That is correct.

[00:16:12] Speaker 01:
And I'm not sure what the other side's position about that is.

[00:16:18] Speaker 02:
Well, even Versada recognized that the determination as to whether a patent is a CBM patent is part and parcel of the PTO's mission.

[00:16:29] Speaker 02:
And Versada was very clear that the PTO is entitled to deference.

[00:16:34] Speaker 02:
and its expertise and how it determines its mission.

[00:16:37] Speaker 02:
And so Versada clearly recognized that the board should be entitled to deference on that issue.

[00:16:47] Speaker 02:
I would also note that the agency decided to resolve individual CBM determinations through adjudication as opposed to rulemaking.

[00:16:59] Speaker 02:
Proxycon says that the agency is entitled to do that.

[00:17:02] Speaker 02:
And so if Versata stands, the agency needs to be given the latitude to be able to make these determinations on a case-by-case basis.

[00:17:24] Speaker 03:
Thank you, Your Honor.

[00:17:25] Speaker 03:
Unless there are further questions about the procedural issues that Mr. Hickman dealt with, I'll proceed to the merits.

[00:17:32] Speaker 03:
Because it is crystal clear that the Board's determination that the patent claims at issue here had no inventive aspect to them over the disclosures of the CompuSonic's publications that is supported by ample evidence in the record.

[00:17:52] Speaker 03:
And it started with

[00:17:54] Speaker 03:
the petition and the declaration of Mr. Kelly, his extensive discussion of the way in which these publications related to one another, and his very detailed claim chart that laid out, in fact, all of the grounds ultimately relied on by the Board to conclude that these patent claims were obvious.

[00:18:17] Speaker 03:
At the very basic level, the Compusonics Disclosure is disclosed, and this is in Exhibit 4119.

[00:18:31] Speaker 03:
The Compusonix system that was a, sorry, 4112 is on page four of the red brief, which is the diagram that reflects the system of two computers with memory communicating with each other over the telephone lines with audio or video being transmitted between one or the other.

[00:18:56] Speaker 03:
The Compusonix tele-recording process is disclosed.

[00:19:01] Speaker 03:
Then further publications such as Exhibit 4119 disclosed that one could use that process to charge a second party money who would pay by credit card in order to download a symphony into their CompuSonic processor in their home.

[00:19:26] Speaker 03:
And then we further know from the Schwartz patent

[00:19:31] Speaker 03:
given by the inventor of the confusonics process that different types of memories, whether they floppy magnetic disks or rigid magnetic disks, are interchangeable.

[00:19:44] Speaker 03:
All aspects of the claimed invention here are disclosed.

[00:19:49] Speaker 00:
Does the confusonics prior art make the commercial success of iTunes irrelevant?

[00:19:58] Speaker 03:
The CompuScience, the commercial success goes to whether the claim to invention is original.

[00:20:10] Speaker 03:
And we think that the CompuScience prior art discloses that it was not innovative.

[00:20:18] Speaker 03:
And therefore it would not, one would have to go to- Let's use the word of the statute.

[00:20:21] Speaker 00:
Was it anticipated?

[00:20:23] Speaker 03:
Yes, you know, we agree.

[00:20:25] Speaker 00:
We think that that actually... Secondary considerations are irrelevant.

[00:20:28] Speaker 03:
That's right.

[00:20:29] Speaker 03:
We actually, we argued that this was anticipation, and we believe that that supported, just as I disclosed, that the CompuSonic's tele-recording process

[00:20:39] Speaker 03:
The publications showed that that method could be done in a way that involved a payment of money through use of a credit card, that it could be the audio or video signal could be sent from a memory in one to the memory of a second, and that the memory of the second could include a hard disk.

[00:21:02] Speaker 03:
Now that hard disk is not required by all the claims, but it is by two of the claims.

[00:21:06] Speaker 03:
And that, too, is revealed.

[00:21:09] Speaker 03:
So we think it's anticipation.

[00:21:11] Speaker 03:
We don't think one needs to show, even deal with secondary considerations.

[00:21:17] Speaker 03:
But at the very least, as the board recognized,

[00:21:19] Speaker 03:
Even if one concludes that it's not a single process, but multiple varieties of the process, because they are all interrelated, they all relate to the same company's products and components, they all refer to one another, that that would be obvious.

[00:21:39] Speaker 03:
And Judge Dyke, you referenced how the prior art can itself suggest

[00:21:45] Speaker 03:
the motivation to combine.

[00:21:47] Speaker 03:
That's what the board found here.

[00:21:49] Speaker 03:
For example, in Exhibit 41,

[00:21:54] Speaker 03:
19 where the article, this is a Fortune article that references the fact that Compusonics had been able to record an hour's worth of audio onto a hard disk, but only about three minutes of audio onto a floppy disk.

[00:22:13] Speaker 03:
And the board said that itself would have suggested to a person of ordinary skill in the art to use a hard disk if necessary to achieve the desired

[00:22:24] Speaker 03:
recording capacity.

[00:22:27] Speaker 03:
So all of that is fully supported by the evidence before the board.

[00:22:32] Speaker 03:
This is not new.

[00:22:33] Speaker 03:
It was in the petition that Apple filed.

[00:22:37] Speaker 03:
It was laid out in detail in the Kelly Declaration, including in his claim charts.

[00:22:42] Speaker 03:
And so the argument that there was some surprise to SightSound, it lacked any basis.

[00:22:48] Speaker 03:
And as there was reference earlier, even to the, the board was very

[00:22:53] Speaker 03:
very sensitive to this concern that SightSound was arguing that it had not had an opportunity to respond.

[00:23:00] Speaker 03:
So the board gave them surrebuttal time at argument, gave them an opportunity to file a surreply.

[00:23:07] Speaker 03:
Not just a surreply brief, but also a further declaration if they so chose.

[00:23:13] Speaker 03:
SightSound chose not to file a further declaration.

[00:23:18] Speaker 03:
Instead, they simply rehashed the arguments

[00:23:21] Speaker 03:
that they had already made before in their briefs.

[00:23:23] Speaker 03:
That was their choice, but they cannot now claim to this Court that they were prejudiced in any fashion.

[00:23:31] Speaker 03:
If there are no further questions, thank you, Your Honor.

[00:23:35] Speaker 00:
Thank you, Mr. Baldwin-Greenmayer.

[00:23:37] Speaker 00:
Mr. Wolfe has a little less than four minutes.

[00:23:40] Speaker 04:
Thank you, Your Honor.

[00:23:41] Speaker 04:
Let me start with the procedural issues.

[00:23:44] Speaker 04:
Your Honor, you referenced the Quozo wash clean Heinecker question.

[00:23:49] Speaker 04:
That may be a useful standard in the IPR context, but we know that standard cannot apply.

[00:23:56] Speaker 04:
It cannot be used in the CBM context because of 18A1, the estoppel provision.

[00:24:02] Speaker 04:
You cannot ask what could have been raised because that's not the standard.

[00:24:06] Speaker 04:
The standard is, and this is throughout the legislative regime and the regulatory regime, what was actually raised.

[00:24:14] Speaker 04:
And if you get into what could have been raised, well then- Why do those two things have to be tied?

[00:24:17] Speaker 05:
I mean, when we're looking at whether something is ultra-virus or not, does it matter whether you might not be stopped on those grounds, even if the board has the power to raise them?

[00:24:30] Speaker 04:
I agree with you completely, Your Honor.

[00:24:32] Speaker 04:
We don't, respectfully, we don't agree with the wash clean doctrine.

[00:24:35] Speaker 04:
I was just saying that that can't apply here.

[00:24:37] Speaker 04:
The first question is, what does the statute say?

[00:24:40] Speaker 04:
What do the regulations say?

[00:24:42] Speaker 04:
that the PTAB can and cannot do.

[00:24:44] Speaker 05:
The regulation... I'm not sure that I was very clear.

[00:24:50] Speaker 05:
What I meant was that even if the board can go beyond things not presented in the petition without having an ultra-virus problem, why would that necessarily change the estoppel standard?

[00:25:05] Speaker 04:
Because the question then becomes, if the board is allowed to go beyond

[00:25:13] Speaker 05:
But the ASAPL provision applies to you, not to the board.

[00:25:16] Speaker 05:
And so it applies to what grounds you raise, not to what the board ultimately initiates.

[00:25:22] Speaker 04:
So imagine this hypothetical, and I want to quick to the substance here.

[00:25:25] Speaker 04:
Imagine a hypothetical where the board said, we win on everything.

[00:25:30] Speaker 04:
And then Apple turns to the district court and says, well, we want to argue obviousness.

[00:25:35] Speaker 04:
And we say, wait, the board addressed obviousness.

[00:25:37] Speaker 04:
And their response is, no, we didn't raise it in our petition.

[00:25:40] Speaker 04:
That was all a waste of time.

[00:25:42] Speaker 04:
The board was ultra-virus.

[00:25:43] Speaker 04:
The board shouldn't have done that.

[00:25:45] Speaker 04:
Well, now where are we?

[00:25:46] Speaker 04:
So the point is the regime in its entirety says the board is to be limited to what was raised.

[00:25:53] Speaker 04:
Every provision says that they can only address what was raised or a subset thereof, and that the only thing that's estoppel is what was raised.

[00:26:01] Speaker 04:
As to Your Honor's question about Chevron, simply put, given that the PTAB in this case or the PTO in this case decided

[00:26:09] Speaker 04:
to adopt the statutory language verbatim, there is no deference due.

[00:26:14] Speaker 01:
No, adjudicatory decisions by agencies are also entitled to chevron deference.

[00:26:19] Speaker 01:
It doesn't have to be in a rule.

[00:26:21] Speaker 04:
But there's no adjudicatory decision.

[00:26:23] Speaker 04:
At the regulatory level, which is where deference is, an individual administrative body is not entitled, like an ALJ for example, is not entitled to administrative deference.

[00:26:34] Speaker 04:
The agency itself is.

[00:26:35] Speaker 04:
Here the agency itself

[00:26:37] Speaker 04:
has not promulgated any rules or regulations on that fact.

[00:26:40] Speaker 04:
Turning to the substance, three points very briefly.

[00:26:44] Speaker 04:
First of all, there was a complete disregard by the PTAB for Demico.

[00:26:49] Speaker 04:
There was evidence by their own expert, Mr. Kelly and Mr. Kenswell, that there was, in fact, it took up the whole field, that there was coextensivity between the claims and iTunes.

[00:27:01] Speaker 04:
That was completely ignored by the panel.

[00:27:04] Speaker 04:
Second, we heard talk about anticipation.

[00:27:06] Speaker 04:
Of course, the PTAB rejected the anticipation claim.

[00:27:10] Speaker 04:
And finally, I would ask you to, when we were asked why we didn't put a declaration in the

[00:27:17] Speaker 04:
Well, the reason is simple, because at that time, the only party that had put in any evidence as to whether a hard drive would have been obvious in that context was SightSound.

[00:27:29] Speaker 04:
Apple has not to this day offered any evidence that a hard drive in the context of these claims would have been obvious.

[00:27:36] Speaker 04:
It is simply the ipsidix of a PTAB engaging in its own fact finding after the proceedings were closed.

[00:27:44] Speaker 04:
That is not the way the regime was set up.

[00:27:47] Speaker 04:
That is not fair.

[00:27:48] Speaker 04:
That is not right.

[00:27:49] Speaker 04:
That is not compliant with statute or regulation.

[00:27:52] Speaker 00:
Thank you.