[00:00:53] Speaker 02:
The next target case is number 15, 1799, Cloud Incorporation against Unified Patents Incorporated.

[00:01:07] Speaker 02:
Mr. Farming, are you ready?

[00:01:12] Speaker 04:
Good morning, Your Honors, and the Maine Police Court.

[00:01:15] Speaker 04:
There is a number of issues covered in our papers, but given the time constraints, I'd only like to address three of them this morning, unless, of course,

[00:01:23] Speaker 04:
You have questions on the others.

[00:01:24] Speaker 04:
And I apologize, I'm a little raspy this morning, so I'm trying to speak up.

[00:01:29] Speaker 04:
The issues I would like to cover concern the rejections of the claims that include the command to copy language as being anticipated by Williams.

[00:01:42] Speaker 04:
Also claims 37 and 42, which include the determining language as anticipated by Balcha or Williams.

[00:01:50] Speaker 04:
And then finally, I'd like to speak to the board's denial of the patent owner's contingent motion to amend.

[00:01:58] Speaker 04:
If we look first at the rejections for anticipation by Williams, we would ask that the court reverse the order's determination on those issues.

[00:02:11] Speaker 04:
Because in fact, the Williams reference does not teach the command to copy a limitation.

[00:02:15] Speaker 04:
The board admits as much at page 24 of its decision and acknowledges... Where does it admit that?

[00:02:24] Speaker 04:
Page 24, 824 in the record, Your Honor.

[00:02:26] Speaker 04:
The board concedes the point that Williams does not specifically describe writing the... Where is page 24 of that sentence?

[00:02:39] Speaker 05:
You say at the top that evidence nullifies patent owners' argument Williams is just as likely to be retained by default?

[00:02:48] Speaker 04:
Immediately below that, Your Honor, the scheme, it's talking about the scheme used in Williams, does not inform us whether the command inserted into the update or incremental backup file causes the second computer to duplicate data or information from the old version of the file into the second computer's copy of the current version of the file.

[00:03:09] Speaker 04:
as required by the writing the command to copy limitation.

[00:03:14] Speaker 05:
Yeah, but then there's the next sentence.

[00:03:15] Speaker 05:
In order to determine that, we need to look at what the second computer does.

[00:03:20] Speaker 05:
I mean, I think it's really hard for you to read this as adopting your position.

[00:03:26] Speaker 05:
It seems to me pretty clearly that you adopted the petitioner's position about what Williams discusses.

[00:03:33] Speaker 04:
And that position simply cannot be sustained by the evidence, Your Honor, because by looking at the result of what Williams does, as the Board did,

[00:03:43] Speaker 04:
you cannot conclude that a command to copy limitation is included in the update file.

[00:03:49] Speaker 04:
Petitioner's own expert tells us that the results of retain by default, which would include a command to copy and discard by, excuse me, retain by default.

[00:04:01] Speaker 03:
But you're not answering, you're not answering the question about the language by the board.

[00:04:09] Speaker 03:
You're making a separate argument.

[00:04:12] Speaker 04:
No, I don't think I am, Your Honor.

[00:04:14] Speaker 04:
I'm reading the language literally, where the board says... In order to determine that... The board looks to the result achieved by Williams.

[00:04:24] Speaker 04:
In other words, they don't look at the update file.

[00:04:28] Speaker 04:
They say, let's look at what the second computer does.

[00:04:31] Speaker 04:
But that's not what the claim requires.

[00:04:32] Speaker 04:
The claim requires something in the update file itself.

[00:04:37] Speaker 04:
Irrespective of what happens at the second computer, the claim is very clear that a command to copy is inserted in the update file.

[00:04:44] Speaker 04:
And the board says Williams does not inform us that that is done.

[00:04:49] Speaker 05:
That to me is... I think that is not a countable reading of what the board said.

[00:04:53] Speaker 05:
And if they had said that, they would have come out the other way.

[00:04:57] Speaker 04:
Your Honor, I think the reason they came out the other way is because what they say later in the paragraph is, let's go and look at the result.

[00:05:04] Speaker 04:
But when you look at the result,

[00:05:06] Speaker 04:
You can't reach the conclusion the board reached because the results of the two different types of update scheme, retained by default, discard by default, are indistinguishable.

[00:05:18] Speaker 04:
You can't tell from the result how you got there.

[00:05:21] Speaker 04:
And this is petitioner's expert testifying on that point.

[00:05:26] Speaker 05:
So that's a substantial evidence question.

[00:05:28] Speaker 04:
It is a substantial evidence question, Your Honor.

[00:05:30] Speaker 04:
And since it's an anticipation argument, or excuse me, an anticipation rejection

[00:05:36] Speaker 04:
that would be the appropriate standard for this court to look to.

[00:05:40] Speaker 04:
And I think when the court does look at the question in that light, you have to conclude that the evidence simply doesn't amount to substantial evidence.

[00:05:52] Speaker 04:
Because by looking at the result, you can't tell how you got there.

[00:05:58] Speaker 05:
OK, but the expert testified that Williams did disclose a discard by default, right?

[00:06:05] Speaker 05:
And there was equal testimony that it did not.

[00:06:08] Speaker 05:
Well, that's what substantial evidence is all about.

[00:06:11] Speaker 04:
And your honor.

[00:06:12] Speaker 05:
There's only a finder who believed one expert over the other one.

[00:06:15] Speaker 04:
And in this case, your honor, what they amounted to, what that decision amounted to was a belief that Williams inherently disclosed.

[00:06:24] Speaker 04:
And inherency is not proper where it's a mere possibility or even probability that that would be the result.

[00:06:32] Speaker 04:
Inherency requires that it be the only

[00:06:35] Speaker 04:
possible result and here that's not the case.

[00:06:40] Speaker 04:
So we think when the court looks to those facts that the anticipation does not necessarily flow from what is disclosed in Williams and it's at least equally likely even under

[00:06:56] Speaker 04:
petitioners experts interpretation at least equally likely that the other scheme could have been employed the other synchronization scheme could have been employed which does not use a command to copy but instead like other references in the case vulture in particular uses modify and insert commands

[00:07:17] Speaker 04:
you get to the same result either way.

[00:07:19] Speaker 04:
And so you can't simply look at the end result of what happened at the second computer and decide, oh, there must have been a command to copy in the update file.

[00:07:31] Speaker 04:
On the question of claims 37 and 42, which are the claims that do not include the command to copy, but instead include the determining language, the board concluded that the determining limitation

[00:07:47] Speaker 04:
requires that the first computer determine whether the last version of the subject file sent to the second computer is not the same as the current version of the subject file.

[00:07:59] Speaker 04:
This is page 14 of the decision.

[00:08:03] Speaker 04:
But when the board went to apply their construction, they didn't apply the construction that I've just repeated to you.

[00:08:13] Speaker 04:
They instead

[00:08:17] Speaker 04:
looked at Williams and asked whether the determining step or the determining limitation required absolute certainty.

[00:08:29] Speaker 04:
And the board at page 26 concluded that when looking at Williams, we do not require that the determining step require absolute certainty.

[00:08:41] Speaker 04:
And so the conclusion was that Williams anticipated the claim.

[00:08:46] Speaker 04:
But this absolute certainty requirement is a bit of a red herring because the actual construction that the board reached is whether the last version of the subject file sent to the second computer is not the same as the current version of the subject file.

[00:09:04] Speaker 04:
Now notice in that statement, it's not the last version sent by the first computer.

[00:09:13] Speaker 04:
the one doing the determining.

[00:09:14] Speaker 04:
It's simply the last version of the file.

[00:09:18] Speaker 04:
Now, the board did not analyze Williams under that standard.

[00:09:23] Speaker 04:
And instead, they asked about this sort of absolute certainty requirement and concluded that, well, Williams doesn't require, or the claim doesn't require absolute certainty and therefore Williams is good enough.

[00:09:37] Speaker 04:
But the board never reached the question

[00:09:40] Speaker 04:
of whether Williams taught the last version of the file sent to the second computer is not the same.

[00:09:50] Speaker 04:
And when you look at Williams, you must conclude that that is not the case.

[00:09:57] Speaker 04:
As we argued below and presented in our papers, Williams specifically describes the situation of sending an MD5 hash.

[00:10:08] Speaker 04:
And the reason the MD5 hash is sent as part of the update file is so that the receiving computer knows which version of the file to apply the update to.

[00:10:21] Speaker 04:
It need not be the last version.

[00:10:24] Speaker 04:
And so again, because this is an anticipation argument, we do not have the precise limitation being taught in the reference.

[00:10:33] Speaker 04:
And so anticipation is not correct.

[00:10:37] Speaker 04:
The same type of flaw in the board's analysis occurred with respect to BALCHA.

[00:10:44] Speaker 04:
When claims 37 and 42 were analyzed with respect to BALCHA, the board told us, and this is page 29, based on its construction of the determining limitation, particularly in light of the fact that the determining limitation recites the determination is made by the first computer without interaction with the second computer.

[00:11:06] Speaker 04:
Balcha anticipates the claim.

[00:11:08] Speaker 04:
Now we're not told really much of anything else about how the board reached that conclusion, but there must have been an error because Balcha unequivocally does not make a determination about whether the last file sent to the second computer is not the same.

[00:11:31] Speaker 04:
Balcha merely describes a process in which

[00:11:35] Speaker 04:
A version of a file at the sending computer is segmented, and then updates are sent to the second computer.

[00:11:46] Speaker 04:
There's no determination involved, as recited in the claim.

[00:11:51] Speaker 04:
And so we think the same error that occurs with respect to the Williams anticipation argument occurs with respect to the Balzer anticipation argument.

[00:12:02] Speaker 04:
And that carries over, by the way, we think,

[00:12:04] Speaker 04:
in terms of the obviousness rejection in terms of Balcha and Free Vault.

[00:12:10] Speaker 04:
It's the same sort of mistake that has been perpetuated.

[00:12:17] Speaker 04:
Finally, let me address the patent owner's motion to amend.

[00:12:22] Speaker 04:
The board criticized the motion to amend and in particular indicated that the patent owner had not

[00:12:33] Speaker 04:
met the burden of explaining the patentability of the claim.

[00:12:40] Speaker 04:
Well, what the patent owner said in its papers was that what was not done prior to the invention was to employ in a method for providing updates as part of a file backup, the file segmenting method, which included the statistical delimiters that are, excuse me, segment delimiters that are statistically determined.

[00:13:01] Speaker 04:
Now, this, I think, was an unequivocal statement that the patent owner believed that the claim as a whole was not taught in the prior art.

[00:13:15] Speaker 04:
Since the time that this case was briefed and submitted, this court decided the Nike versus Adidas case.

[00:13:25] Speaker 04:
And that's reported at 812 Fed 1326.

[00:13:30] Speaker 04:
And in that case, the court examined the board's policies and procedures for motions to amend the inner party's reviews and confirmed that absent any allegation of inequitable conduct, a statement by a patent owner that a proposed substitute claim is patentable over prior art known to the patent owner is all that's required to satisfy the patent owner's obligation

[00:13:59] Speaker 04:
under the board's master image and idle-free cases.

[00:14:03] Speaker 04:
This is at pages 1350 and 51 of the court's decision.

[00:14:08] Speaker 02:
Well, it didn't go that far, did it?

[00:14:11] Speaker 02:
They say all you have to do is say that my amended claim satisfies the prior art.

[00:14:20] Speaker 02:
They didn't say that you needn't explain anything about why the amended claim is patentable.

[00:14:27] Speaker 02:
I thought they were issued

[00:14:28] Speaker 02:
was that the board asked too much, not that they don't need to ask anything for the amended claim.

[00:14:36] Speaker 04:
It's not that they don't need to ask anything, Your Honor.

[00:14:38] Speaker 04:
It's that the board in the Nike case didn't accept the statement

[00:14:45] Speaker 04:
that the patentability of the claim over the prior art known to the patent owner was enough to get over the initial threshold of what is required under master image and idle-free.

[00:14:57] Speaker 05:
Of course, there has to be... The problem is that you didn't address the obviousness question at all, right?

[00:15:03] Speaker 04:
I don't think that's true, Your Honor.

[00:15:05] Speaker 03:
We stated unequivocally that... You addressed only Williams with a reference to passing reference to fault.

[00:15:13] Speaker 04:
because we believe that's the closest prior archer on.

[00:15:16] Speaker 04:
We can't address... What page do I find this at?

[00:15:20] Speaker 03:
336.

[00:15:21] Speaker 03:
336.

[00:15:24] Speaker 04:
We can't address art that we don't know about.

[00:15:26] Speaker 04:
And we believe that Williams was the closest archer in the case.

[00:15:33] Speaker 04:
But we also included the statement that what was not done was to provide this method of determining the limiters

[00:15:41] Speaker 04:
in a file backup process.

[00:15:45] Speaker 05:
Where do I find that on 336?

[00:15:52] Speaker 03:
It's the truth, the 339, that's the section.

[00:15:56] Speaker 03:
339.

[00:15:57] Speaker 03:
What section is that again?

[00:16:05] Speaker 04:
Yes, Your Honor, at 337,

[00:16:08] Speaker 04:
beginning at 337, the paragraph that begins at the time of the invention, we discuss what we believe was known in the art.

[00:16:18] Speaker 04:
And we cite to various portions of the record before the board.

[00:16:25] Speaker 04:
And then at 338, in the middle of the page, we allege what was not done prior to the invention was to employ in this method the use of the statistical delimiters.

[00:16:38] Speaker 04:
I think we satisfied the requirement of stating that the proposed substitute claim was patent law with the art known to us.

[00:16:54] Speaker 02:
Let's hear from the other side and we'll save some rebuttal time.

[00:17:08] Speaker 06:
Yes, Daniel Cooley on behalf of Unified Patents, and I'm joined here by my colleague Jonathan Stroud, the Chief Patent Counsel of Unified Patents.

[00:17:16] Speaker 05:
Don't they have a point under the Nike case?

[00:17:19] Speaker 06:
Your Honor, we believe that the Nike case is distinguishable, and for this reason.

[00:17:23] Speaker 06:
The Nike case refers to the prior art known to the patent owner.

[00:17:28] Speaker 06:
And here we're discussing both the prior art known to the patent owner, but particularly the prior art of record,

[00:17:34] Speaker 06:
And the prior art of record, as we know under Master Image, includes several categories.

[00:17:39] Speaker 05:
Yeah, but I don't see the board's decision here as taxing them for failure to address the prior art of record.

[00:17:46] Speaker 05:
They seem to be taxing them for not addressing the prior art known to the patent, or perhaps prior art in its entirety.

[00:17:56] Speaker 06:
Well, there's also two additional difficulties with their argument.

[00:18:01] Speaker 06:
And there's initially a factual difficulty.

[00:18:03] Speaker 05:
They never made it.

[00:18:04] Speaker 05:
Wait.

[00:18:04] Speaker 05:
Let's just stick with that one.

[00:18:06] Speaker 05:
Is my statement of what the board said accurate?

[00:18:09] Speaker 05:
They didn't say you didn't distinguish the prior art of record.

[00:18:13] Speaker 05:
They said you didn't distinguish the prior art that you knew about.

[00:18:18] Speaker 06:
I think that the board did state that they did not address the prior art.

[00:18:23] Speaker 05:
That they knew about.

[00:18:25] Speaker 05:
In addition, well, yes, there would be that, but we believe... I mean, giving it a generous reading from your standpoint, they said you didn't distinguish the prior art that you knew about, forget about all prior art.

[00:18:37] Speaker 06:
Okay, and if that, even under that reading of the board's... But that reading would be inconsistent with Nike, wouldn't it?

[00:18:43] Speaker 06:
It would not, and because Nike would require that they would at least make a conclusory assertion of some sort that the prior art known to them,

[00:18:54] Speaker 06:
Patent claim distinguished over that, but they did not do that here.

[00:18:57] Speaker 06:
As we know in our brief.

[00:19:00] Speaker 05:
I thought Nike said the opposite, that requiring them to distinguish the prior art that they knew about was not an appropriate requirement.

[00:19:08] Speaker 06:
I believe what the Nike case says, Your Honor, is that, and this is in the Nike opinion, that they at least made that conclusory statement in Nike.

[00:19:18] Speaker 06:
But there was a statement on the record in Nike that there was no prior art known to the patent owner wherein it disclosed the relevant features.

[00:19:28] Speaker 06:
Here, Clouding failed to make such even that minimal statement.

[00:19:30] Speaker 05:
Yeah, but look, it said, and Nike said, we must consider whether the board's denial of Nike's motion to amend for federal to show patent jurisdiction or a prior art not of record but known to the patent.

[00:19:41] Speaker 05:
He provides an adequate basis for affirmance for the reasons explained below.

[00:19:45] Speaker 05:
We conclude that it is not.

[00:19:50] Speaker 05:
So it doesn't seem to me that in light of the Nike case you can rely on that aspect of the board's decision.

[00:19:58] Speaker 05:
The question is whether there's anything else in here which would provide an adequate basis for what the board did for refusing the motion for leave to amend.

[00:20:09] Speaker 06:
And we believe that there is an additional reason.

[00:20:12] Speaker 06:
But respectfully, I would point the court very quickly to at the end of Nike, where the PTO acknowledged Nike's statement about the substitute claims patentability over the prior or not of record known to Nike.

[00:20:24] Speaker 06:
So there was a statement, and that was relied upon.

[00:20:27] Speaker 06:
But even setting that aside, Your Honor, there is an additional independent reason here in this case.

[00:20:34] Speaker 06:
And that is that Clouding failed to address the obviousness of the proposed

[00:20:39] Speaker 06:
substitute claim and here this is after I think the context is important because prior to amending the claim the board had instructed clouding about the proper manner of proposing a substitute amendment and there was a specific instruction provided on discussing obviousness and this is also something that is a natural reading of even the

[00:21:08] Speaker 06:
procedures set forth in 37 CFR 42121 where it talks about talking about and discussing the grounds.

[00:21:16] Speaker 06:
And here we have grounds of obviousness.

[00:21:18] Speaker 05:
Well, did they address the prior record on the pages we were talking about earlier, SB 36?

[00:21:24] Speaker 06:
The one the council was referring to, does that discuss the... So those statements the council referred to are specifically limited

[00:21:34] Speaker 06:
in important regards.

[00:21:36] Speaker 06:
For example, they limit it to the prior art of this proceeding.

[00:21:40] Speaker 06:
It would not include, for example, the prior art of the prosecution of history.

[00:21:44] Speaker 06:
And they also limit it to the area of file backup.

[00:21:49] Speaker 06:
And so they've limited their statements and not even made even a conclusory statement that it covers the prior art known to them, because they've limited out certain sections and important swaths of art.

[00:21:59] Speaker 06:
This file segmentation

[00:22:02] Speaker 06:
is a broad area, and it covers more than simply file backup.

[00:22:06] Speaker 06:
And that's exactly what the board was finding, is that there's more here than merely file backup.

[00:22:12] Speaker 06:
And for that reason, the board found that the motion was deficient.

[00:22:19] Speaker 05:
Where does the board say there's more here than file backup?

[00:22:23] Speaker 05:
Let's refer to the board's decision.

[00:22:46] Speaker 06:
This is on page 39.

[00:22:48] Speaker 06:
It says, during oral argument upon inquiry from the board, Council for Patent Owner acknowledged that its assertions of patentability were limited to the field of file backup.

[00:23:09] Speaker 06:
And then it continues, although Patent Owner is not expected to know of all pre-existing prior art, it is expected to indicate what it does know

[00:23:16] Speaker 06:
particularly with respect to the feature it has proposed to add to the original patent claims, i.e.

[00:23:21] Speaker 06:
defining segments, et cetera, et cetera.

[00:23:25] Speaker 06:
Instead, patent owner relied upon ARC asserted by the petitioner updates for file backups.

[00:23:33] Speaker 06:
So there is this focus here on file backup, an indication that here the amendment in question relates to file segmentation.

[00:23:42] Speaker 06:
And there's no discussion of where file segmentation was performed elsewhere and why it would not have been obvious, for example, to amend or modify Williams, even if counsel believed that Williams did not teach that aspect, which it does.

[00:23:58] Speaker 06:
And we've shown that Williams remains in anticipation.

[00:24:01] Speaker 06:
But even if it did not, for some reason, teach the features in the proposed amended claim,

[00:24:06] Speaker 06:
there's no explanation of why it would not have been obvious for it to incorporate that.

[00:24:09] Speaker 06:
There's no discussion of the obviousness rationales, for example, KSR.

[00:24:14] Speaker 02:
Did you say that they have to show this is not an obvious amendment?

[00:24:19] Speaker 06:
I would say on the declaim, it is not obvious, but the focus here is on the newly proposed... Obvious in terms of what?

[00:24:28] Speaker 02:
In terms of the prior art or the other claims?

[00:24:31] Speaker 06:
Well, it would be obvious in terms of the prior art, but

[00:24:34] Speaker 06:
The original claim upon which the proposed claim was based was shown to be anticipated twice and obvious once.

[00:24:42] Speaker 06:
So there's three separate and independent grounds showing that the features in that claim were both anticipated and obvious.

[00:24:50] Speaker 06:
So the board directed clouding to focus on the new feature and why did that new feature

[00:24:56] Speaker 06:
create a claim that made the claim not obvious.

[00:25:00] Speaker 02:
You're saying their own claims are prior art against the amended claim?

[00:25:04] Speaker 06:
Well, I'm not saying, Your Honor, that that's the basis of the board's decision.

[00:25:07] Speaker 02:
I think that's what I heard you say.

[00:25:10] Speaker 02:
Why do they have to distinguish their own claims?

[00:25:13] Speaker 06:
What I'm saying, Your Honor, is that the claim is shown to be anticipated, but the analysis is over the prior art always.

[00:25:22] Speaker 06:
So the analysis would be over... The unamended claim.

[00:25:26] Speaker 02:
is shown to be anticipated.

[00:25:27] Speaker 06:
Unamended claim has been, yes, that's correct, shown to be anticipated.

[00:25:31] Speaker 06:
And now they've added an amendment.

[00:25:33] Speaker 06:
And now with that amendment, they would have to show why that amendment causes that proposed claim to now be patentable over the prior art.

[00:25:42] Speaker 02:
Over the prior art?

[00:25:44] Speaker 02:
So you're not saying that it needs to be patentable over their own rejected claim?

[00:25:49] Speaker 06:
No, Your Honor.

[00:25:50] Speaker 06:
It would have to be patentable over the prior art.

[00:25:52] Speaker 02:
But that's really what the board said, isn't it?

[00:25:55] Speaker 06:
that the claim would have to be patentable?

[00:25:56] Speaker 02:
In terms of what they had to distinguish?

[00:25:58] Speaker 06:
Is their own claim?

[00:26:01] Speaker 06:
Is that the question, Your Honor?

[00:26:01] Speaker 06:
If they had to show that it was distinguishable over their own claim?

[00:26:04] Speaker 06:
I think at root, the board is always saying that it has to be patentable over the prior art.

[00:26:11] Speaker 06:
And that is the relevant inquiry here.

[00:26:13] Speaker 06:
Is the claim patentable over, for example, Williams and the other prior art of record?

[00:26:22] Speaker 06:
Do you have any questions about the initial topics of command to copy and the determining limitation?

[00:26:31] Speaker 02:
We'll listen to what you have to say.

[00:26:34] Speaker 06:
I'll cover them very briefly given the short remaining time.

[00:26:37] Speaker 02:
Are you going to share time with your colleague or do you want to continue?

[00:26:41] Speaker 06:
We're sharing five minutes, but that particular topic is only being addressed by us.

[00:26:47] Speaker 06:
Let me just very quickly say the command to copy limitation

[00:26:51] Speaker 06:
was shown to be contained in several prior art references, including Williams and Miller.

[00:26:59] Speaker 06:
And there is substantial evidence supporting those conclusions, including admissions by Clouding's own expert witness.

[00:27:08] Speaker 06:
And I would refer the court to A1350 for that admission.

[00:27:14] Speaker 06:
I would also refer the court to A869

[00:27:18] Speaker 06:
Column 22 through 5 and A914 through 15 for discussion of the substantial evidence supporting that conclusion.

[00:27:28] Speaker 06:
And second, there is substantial evidence supporting the board's conclusion regarding the latest version of the file limitation.

[00:27:36] Speaker 06:
Again, we have an admission by Clouding's own expert that Boucher discloses the latest version of the file.

[00:27:43] Speaker 06:
And that's provided A1323, lines 6 through 13.

[00:27:49] Speaker 06:
If there are no further questions, we would ask the court to affirm the board's decision.

[00:27:53] Speaker 02:
OK.

[00:27:53] Speaker 02:
We'll hear from Mr. McBride.

[00:28:06] Speaker 01:
Good morning.

[00:28:07] Speaker 05:
May it please the court.

[00:28:09] Speaker 05:
You didn't send us a 28-J letter about Nike, did you?

[00:28:12] Speaker 01:
Excuse me?

[00:28:12] Speaker 05:
You didn't send us a 28-J letter about Nike, did you?

[00:28:16] Speaker 01:
No, no, we did not.

[00:28:19] Speaker 05:
I think you should have.

[00:28:21] Speaker 01:
Well, Nike only addressed, and let me actually, I have that case for you right here.

[00:28:29] Speaker 01:
The statement that they're referring to in Nike is made under the heading of Prior Arts.

[00:28:37] Speaker 01:
Establishing patentability over prior art not of record, but known to the patent owner?

[00:28:42] Speaker 01:
And that's not at issue in this case.

[00:28:44] Speaker 05:
Well, yes it is, because that's what the board said.

[00:28:46] Speaker 05:
Now, maybe what the board said is harmless error, but what the board said is you haven't shown this is not obvious over prior art known to you.

[00:28:56] Speaker 05:
And Nike says very clearly that that is not the right standard.

[00:29:00] Speaker 01:
Correct?

[00:29:00] Speaker 01:
That's correct.

[00:29:01] Speaker 05:
So to the extent the board... So I think you should have said it's the Nike case.

[00:29:05] Speaker 05:
Presumably, you're all aware of the Nike case, right?

[00:29:09] Speaker 01:
Yes, we certainly are.

[00:29:11] Speaker 01:
I apologize if we should have sent you the Nike case.

[00:29:14] Speaker 05:
I mean, it undercuts the board's articulated rationale.

[00:29:18] Speaker 05:
It's directly contrary to it.

[00:29:20] Speaker 01:
OK.

[00:29:21] Speaker 01:
I'd like to address that point.

[00:29:22] Speaker 01:
I think the board's rationale is still quite strong here, and I think I can clarify that by pointing you to page 86 of the board's opinion.

[00:29:33] Speaker 01:
At page 86, they outlined the three different rejections for claim 42.

[00:29:40] Speaker 01:
That's the original unamended claim.

[00:29:43] Speaker 01:
It was anticipated by Williams, which is directed to the field of file backup.

[00:29:48] Speaker 01:
It was anticipated by Balcha, which is directed to the field of file synchronization.

[00:29:52] Speaker 01:
and it was obvious over Balcha in combination with Freibald.

[00:29:57] Speaker 01:
And Freibald is in the field of file editing and specifically detecting whether a change has been made to a file.

[00:30:05] Speaker 01:
So we've got three prior art references and three separate fields of prior art.

[00:30:10] Speaker 01:
They're all relevant to the patentability inquiry.

[00:30:13] Speaker 01:
And clouding in this motion to amend admits they just focused on the single field of file back-up.

[00:30:18] Speaker 05:
Okay, so it seems to me that where we are is the question of whether the board's articulated rationale was harmless error because they failed to address what they needed to address under the Nike standard.

[00:30:33] Speaker 01:
I think to the extent they were going to require Clouding to address prior art in the field of outside the field of file backup to art that they were aware of, that they didn't make any mention of, that's harmless error.

[00:30:48] Speaker 01:
But we have references in the record that were a basis for the ground of rejection.

[00:30:53] Speaker 01:
that are relevant, and the limitation they added of just comparing two files is relevant to those fields of file synchronization.

[00:31:00] Speaker 01:
If you're going to sync up two files, you're going to want to compare them.

[00:31:03] Speaker 01:
If you're detecting whether a file has been edited, you're going to compare a recent version.

[00:31:07] Speaker 05:
I mean, fair enough.

[00:31:08] Speaker 05:
They should have addressed the prior art of record more broadly than they did.

[00:31:15] Speaker 05:
Yes.

[00:31:16] Speaker 05:
But the question is, can we affirm the board on the ground that their misstatement of the standard

[00:31:22] Speaker 05:
is harmless error.

[00:31:23] Speaker 05:
Have we ever addressed that question?

[00:31:26] Speaker 01:
I think you certainly can affirm the board's decision and attribute any statements that require them to address prior art that they're aware of that's not in the record as harmless error because we do have these very significant omissions where they didn't address the vulture reference in their motion to amend other than in a passing statement and they don't mention the fry vault reference at all.

[00:31:50] Speaker 01:
There's complete omission there.

[00:31:51] Speaker 01:
And if your claim is rejected over a combination of two references, and you're going to amend your claim by adding a new limitation, at the bare minimum you should address the references, all of them, that were used to reject the original claim.

[00:32:04] Speaker 01:
And here, they just stated that they're only looking at the file of the backup field.

[00:32:10] Speaker 01:
while ignoring these other fields of invention that have relevant references, and they admit that the invention itself, the 799 patent, is directed to the field of file synchronization.

[00:32:20] Speaker 01:
So why their expert would not be comfortable, and that's what they said, their expert was not comfortable to make a statement outside the field of file backup, is inconsistent because in his declaration he stated he was an expert in the field of file synchronization.

[00:32:33] Speaker 01:
So that's a pretty glaring omission, that they first limited it to the field of file backup, and then they only looked at the Williams reference, specifically in their motion to amend, and didn't address Freibald at all.

[00:32:46] Speaker 01:
And then, as Cloudy admits, they focused on the claim as a whole.

[00:32:51] Speaker 01:
But when you're adding a new limitation, the first step has to be to look at just the new claim limitation that you're adding.

[00:32:57] Speaker 01:
Because if that new limitation is present anywhere,

[00:33:00] Speaker 01:
you have to address whether it would be obvious to combine it with the other prior references.

[00:33:05] Speaker 01:
I see my time is up, so unless there's any further questions.

[00:33:07] Speaker 02:
Please continue to answer the question.

[00:33:11] Speaker 01:
So there's those three very significant errors, and the last one was they needed to at least focus on the new limitation and look to at least Freibald, Williams, and Balcha to see if that limitation of comparing two files

[00:33:26] Speaker 01:
with the statistically optimal division points was present.

[00:33:30] Speaker 01:
And they just simply failed to do so.

[00:33:32] Speaker 01:
And that's very similar to what happened in the Microsoft, the ProxyCon decision where the DRP reference was used to reject the claims.

[00:33:39] Speaker 01:
They had notice of it, they had opportunity to respond to it, and they simply chose not to.

[00:33:44] Speaker 01:
And that's exactly what happened here.

[00:33:46] Speaker 01:
So I submit that any statements by the board that address prior, not a record, but known to the patent owner, would be harmless error.

[00:33:55] Speaker 01:
But there's still a very strong basis to affirm the board's denial of the motion to amend here.

[00:34:01] Speaker 02:
Any more questions for Mr. McBride?

[00:34:12] Speaker 02:
Thank you.

[00:34:13] Speaker 02:
Mr. Fahmy.

[00:34:14] Speaker 04:
Thank you, Your Honor.

[00:34:16] Speaker 04:
With respect to the motion to amend, Unified has agreed today that the patentability question to be asked is the patentability of the proposed claim, not the patentability of a newly added limitation.

[00:34:34] Speaker 04:
And it was that patentability of the claim that was addressed by Cloud.

[00:34:38] Speaker 05:
But you didn't address the patentability of a new claim over the entirety of the prior art of record, correct?

[00:34:46] Speaker 04:
I believe you did, Your Honor, and I'm looking at page A338.

[00:34:52] Speaker 05:
I thought it was pretty clear that you only addressed art in the file backup area.

[00:34:59] Speaker 04:
Well, all of the art that was of record in the proceeding was in the file backup area, Your Honor.

[00:35:06] Speaker 04:
So we can't address art.

[00:35:08] Speaker 04:
I thought your expert said he wasn't comfortable going outside that area.

[00:35:14] Speaker 04:
That was the area he was asked to opine in.

[00:35:17] Speaker 04:
So that's the area he knows, file backup, file synchronization.

[00:35:23] Speaker 04:
That's what's at the core of the patent that was at issue in the case below.

[00:35:30] Speaker 04:
So that is the area that he addressed.

[00:35:33] Speaker 04:
And in our papers and looking at A338, we state, none of the cited references at issue in this proceeding teaches or suggests

[00:35:43] Speaker 04:
determining whether a second computer has a latest version of a file, et cetera, dealing with the statistically determined segment delimiters.

[00:35:52] Speaker 04:
And council made a point that we didn't discuss the prior concerning segment delimiters.

[00:36:01] Speaker 04:
That's not so.

[00:36:02] Speaker 04:
We discussed it, I think, rather in detail at 337 and 338 in our original motion.

[00:36:10] Speaker 04:
And we discuss exactly what we believe was known in the art and made numerous citations, both to expert reports and to Williams.

[00:36:20] Speaker 04:
Williams is the reference that was in the case that really discussed segment dilemmas.

[00:36:26] Speaker 04:
We heard about Freibald.

[00:36:28] Speaker 04:
Freibald has nothing to do with segment dilemmas.

[00:36:30] Speaker 04:
Freibald is about sending an updated copy of a web page to somebody else and was never relied upon in any of the rejections for teaching segment dilemmas.

[00:36:41] Speaker 04:
Balcha likewise not relied upon to the extent of Williams for teaching segment delimiters and in any event we made the statement that none of the references which would include Balcha, Freiburg, Miller for that matter, taught or suggest what was being added to the claim.

[00:37:02] Speaker 05:
No, it doesn't say that.

[00:37:06] Speaker 04:
I beg your pardon, taught or suggested the claim as a whole.

[00:37:10] Speaker 04:
Where do they say that?

[00:37:11] Speaker 04:
So I'm looking at A338, Your Honor.

[00:37:15] Speaker 04:
This is our motion to amend.

[00:37:17] Speaker 04:
At the bottom of the page, none of the cited references at issue in this proceeding teaches or suggests determining whether a second computer has a latest version of a file, wherein said determining is performed by the first computer without interaction with the second computer by comparing representations of segments of the latest version of the file

[00:37:41] Speaker 04:
with representations of segments of an earlier version of the file in which ends of each of the segments of the earlier version of the file are defined by segment delimiters that are statistically determined to be optimal division points for the segments.

[00:37:58] Speaker 04:
So this I believe is Pat Noehner's statement that the claim is neither anticipated by nor obvious in view of those references.

[00:38:15] Speaker 04:
Unless there are further questions, Your Honor, we'll submit the case.

[00:38:18] Speaker 02:
Thank you, Mr. Fahmy.

[00:38:20] Speaker 02:
Thank you, Counsel.

[00:38:21] Speaker 02:
The case is taken under submission.