[00:00:10] Speaker 03: The final case for argument is 152072, N-ray silver peak systems. [00:00:54] Speaker 01: I'd like to make four points today. [00:01:07] Speaker 01: First, you need to accept everything about the evidence in the Patent Office's brief as correct. [00:01:14] Speaker 01: The proposed modification of McCann lacks at least two elements of the amended claims. [00:01:20] Speaker 01: The conclusion of obviousness is unsupportable and needs to be reversed. [00:01:25] Speaker 01: Second, even if you accept that the modification of McCann is supported by substantial evidence, the theory on which it was based was first presented in the final written decision. [00:01:38] Speaker 01: We had no opportunity to address it under this Court's decisions in Dell and Belton. [00:01:43] Speaker 01: It needs to be set aside. [00:01:46] Speaker 01: Third, the Board's decisions are not supported by [00:01:49] Speaker 01: substantial evidence, and fourth, the board committed legal error in not giving us an opportunity to address the Section 101 issue and construing the claims in a way which found them patent-eligible. [00:02:04] Speaker 01: On the first point, even if you accept the board's modification of McCann, it lacks two elements of the claims. [00:02:13] Speaker 01: And you can see the claims as we annotated them on page four of our reply brief. [00:02:19] Speaker 01: The key limitations are, so the claim continues on from three on to four. [00:02:31] Speaker 01: On page four of our applied brief, we have annotated there some of the limitations. [00:02:36] Speaker 01: The ones that are important in the first element are to store the encrypted data and transmit the original data. [00:02:45] Speaker 01: So the claims require certain operations on encrypted data. [00:02:49] Speaker 01: certain operations on unencrypted or original data. [00:02:53] Speaker 01: And what this is saying is the source site appliance is going to receive original data that's unencrypted, it's going to encrypt it and store it in its memory, and it's going to transmit the original data to the destination site appliance. [00:03:11] Speaker 01: The other important feature is in the second big element there, [00:03:15] Speaker 01: The destination side appliance is going to encrypt the original data received. [00:03:21] Speaker 01: So it's going to receive original data. [00:03:22] Speaker 01: It's going to encrypt it. [00:03:26] Speaker 01: And what the Patanoff modification of McCann is here is to take the encryption encoding that McCann has on its sending side transaction accelerator. [00:03:42] Speaker 01: and then add that same encryption to the destination side transaction accelerator. [00:03:49] Speaker 01: So what that modification of McCann does is the data comes in, it's encoded as encryption, and then that encrypted data is transmitted to the other transaction accelerator in what McCann calls binding. [00:04:06] Speaker 01: And then that same encrypted binding is just stored [00:04:10] Speaker 01: in the other transaction accelerator. [00:04:12] Speaker 01: So the modification lacks the element of the claim that it's going to transmit original data because it's been transmitted encoding data. [00:04:21] Speaker 01: The reason it's encoded is encoded for a transition. [00:04:24] Speaker 01: And then receiving destination device is not going to encrypt original data because what the McCann modification sends is encrypted data. [00:04:38] Speaker 01: So the patent office is very clear that its modification is to operate in this way. [00:04:44] Speaker 01: It's on JAA 30. [00:04:46] Speaker 01: And if you look at the McCann disclosure, which the office cites, it's paragraph 89 of McCann. [00:04:55] Speaker 01: McCann is explicit that what it is doing in this encoding scenario is instead of sending original data, it's sending encrypted encoded data. [00:05:04] Speaker 01: If you look at figure four of McCann, [00:05:07] Speaker 01: It's clear that this is the way it operates. [00:05:09] Speaker 01: So this theory is the same theory my opponent presents here today on page 42 of its brief. [00:05:17] Speaker 01: And the claims just don't, the claims is proposed to be modified by the officers, don't meet the elements of the claims and the conclusion of obviousness that presents support. [00:05:30] Speaker 01: Turning to my second point. [00:05:33] Speaker 01: Even if the modification is supported by substantial evidence here, what happened is the theory that the petitioner presented, we dealt with. [00:05:46] Speaker 01: We removed the basis, the prior art that it presented. [00:05:50] Speaker 01: So the patent office, in its final written decision, came up with its own theory, substituted it in, in lieu of the petitioners. [00:05:58] Speaker 01: And we saw that for the first time in the final written decision. [00:06:02] Speaker 01: We never had an opportunity to address it. [00:06:04] Speaker 01: And had we had an opportunity to address it, we would have. [00:06:07] Speaker 01: And what you can see, if you look at JA 234 through 236, that is the petitioner's opposition to our motion to amend. [00:06:20] Speaker 01: And in that, that is the section where it deals with its theory about why the proposed modification would be obvious. [00:06:27] Speaker 01: It makes two arguments there. [00:06:30] Speaker 01: The first is one which, [00:06:32] Speaker 01: based on testimony of our expert, Dr. Kenning. [00:06:35] Speaker 01: We dealt with that. [00:06:37] Speaker 01: The board didn't rely on it. [00:06:39] Speaker 01: It's irrelevant. [00:06:40] Speaker 01: The second argument is an argument based on... They didn't rely on it. [00:06:47] Speaker 01: They certainly addressed it. [00:06:49] Speaker 01: The board? [00:06:50] Speaker 01: Yes. [00:06:51] Speaker 01: The board comments on Dr. Kenning's deposition testimony. [00:06:56] Speaker 01: The board's [00:06:57] Speaker 01: I think you'll find on JA 29 and 30, where the board addresses the theory of McCann. [00:07:09] Speaker 02: The other portions of Dr. Cannon do not present any support to the assertion that those still in the yard do not perceive that as coronal wiring that we're talking about. [00:07:20] Speaker 01: So I think that was JA 32 where you're pointing it out, is that right? [00:07:27] Speaker 02: No. [00:07:27] Speaker 01: Yeah, so you're entirely right. [00:07:30] Speaker 01: So that's a different part than what I was referring to. [00:07:34] Speaker 01: So that's referring to parts of Dr. Canning's declaration. [00:07:37] Speaker 01: I think if you look back onto JA 234 through 235, you will see an argument in petitioner's opposition to our motion to compel. [00:07:56] Speaker 01: where they argued deposition testimony of Dr. Kenning makes particular concessions. [00:08:03] Speaker 01: And what that deposition testimony was in substance, they're taking his testimony on a general topic and omitting his testimony on a specific topic related to RAN optimization devices. [00:08:16] Speaker 01: So in our reply, if you look at what he actually testified about here, it's the exact opposite. [00:08:22] Speaker 01: The board did not adopt [00:08:25] Speaker 01: the argument that Petitioner made based on the deposition testimony of Dr. Kenning. [00:08:31] Speaker 01: Certainly the board in that one sentence that you quoted addresses the declaration testimony of Dr. Kenning. [00:08:39] Speaker 01: Sorry if that was unclear. [00:08:41] Speaker 01: The point I was trying to make is that in JEA 234, 235, 236, the board was presented two arguments by Petitioner. [00:08:51] Speaker 01: One based on Dr. Kenning's deposition testimony, which it didn't rely on. [00:08:56] Speaker 01: And then one based on the Riverbed White Paper. [00:08:59] Speaker 01: So the Riverbed White Paper was a reference that we showed. [00:09:03] Speaker 01: It was not a prior art print publication. [00:09:05] Speaker 01: It showed conception, reduction of practice before any date that it was relevant to. [00:09:12] Speaker 01: And there was no date from petitioner in any event. [00:09:15] Speaker 01: So the board, in its final written decision, takes what [00:09:20] Speaker 01: petitioner argued on 235 and 236 and substitutes its own theory based on McCann for the conclusion that the petitioner argued for. [00:09:33] Speaker 01: And we see that in the first time in its final written decision. [00:09:38] Speaker 04: I guess I just want to be clear on what you're saying. [00:09:40] Speaker 04: Sure. [00:09:40] Speaker 04: You said 10 minutes ago, I guess this was point two, you've been raised. [00:09:43] Speaker 04: Yes. [00:09:44] Speaker 04: And you said you had no opportunity to respond. [00:09:47] Speaker 04: So is it your view if the board says anything beyond what the petitioner has argued? [00:09:52] Speaker 04: Because obviously, the only thing you're responding to is what the petitioner is saying, right? [00:09:57] Speaker 04: So if the board does anything beyond what the petitioner has said, then that's somehow something that you've been denied your opportunity to respond to. [00:10:06] Speaker 01: I just want to- Yeah, I don't know. [00:10:07] Speaker 01: It's a fair question. [00:10:08] Speaker 01: What's the boundary of how long the leash can you give the board? [00:10:12] Speaker 01: And I think this case is indistinguishable from what happened in Dell. [00:10:16] Speaker 01: So in Dell, the party was presented for the first time at oral argument, a theory that slides in a prior art reference meant this element of claims caddies. [00:10:29] Speaker 01: And that was the only basis that the board adopted in its final written decision for holding claims invalid. [00:10:38] Speaker 01: Our situation is actually worse than Dell, because we didn't even see this theory at oral argument. [00:10:44] Speaker 01: This was a theory that the board came up with [00:10:47] Speaker 01: after we removed the Riverbed White Paper as a possible prior art reference. [00:10:52] Speaker 02: When you say it's a theory they came up with, it's sort of like applying law to the facts kind of theory? [00:11:01] Speaker 01: I think it is a theory of how someone scaled in the art would interpret parts of McCann and what conclusions can be drawn from that first determination about how McCann [00:11:16] Speaker 01: would motivate itself to modify. [00:11:19] Speaker 02: It's sort of like the nature of the judicial process? [00:11:23] Speaker 01: It very well may be the nature of the judicial process. [00:11:26] Speaker 01: But the Administrative Procedure Act requires that we be given notice of the facts and law to which we are going to be called to address. [00:11:36] Speaker 01: Well, McCann was in flight. [00:11:38] Speaker 05: McCann was certainly in flight. [00:11:39] Speaker 05: So the question is, are you saying that the board was disabled from having [00:11:47] Speaker 05: taking its own view of what McCann means? [00:11:52] Speaker 05: What the petitioners may have viewed? [00:11:55] Speaker 01: Well, what I'm saying is there was a theory of invalidity or non-patentability presented by the petitioner. [00:12:06] Speaker 01: And it's very clear what that theory is. [00:12:08] Speaker 01: It's on J.A. [00:12:09] Speaker 01: 235 and 236. [00:12:11] Speaker 01: They say, the Riverwood white paper motivates or explains there's a need for security. [00:12:17] Speaker 01: and it provides a solution in disk encryption. [00:12:21] Speaker 01: And what the patent office says is, I'm going to step in and say, Murderbed, or excuse me, McCann, it provides a different motivation, and then provides a slightly different ultimate modification motivated by McCann itself. [00:12:45] Speaker 01: The patent office says, [00:12:46] Speaker 01: McCann motivates itself to modify. [00:12:50] Speaker 01: I don't mean to explain why that just doesn't make any sense in the situation. [00:12:59] Speaker 01: What the theory of McCann is by the Patent Office is that you take data which is encrypted on one side, the sending, transaction, or accelerator. [00:13:13] Speaker 01: And the theory is that that addresses security. [00:13:17] Speaker 01: And so McCann, the modified theory is, you take that encrypted data, you send it over and encrypt it again on the destination side. [00:13:27] Speaker 01: But unmodified, here's what McCann does. [00:13:31] Speaker 01: Unmodified, the encrypted data is saved at the sending side. [00:13:36] Speaker 01: And unmodified, that same data is encrypted on the destination side. [00:13:42] Speaker 01: So if security is the concern, [00:13:45] Speaker 01: unmodified out of the box that can give you security on one side, security on the other. [00:13:51] Speaker 01: And there's no suggestion in the record about why that security is inadequate. [00:13:57] Speaker 01: And McCann should self-modify itself to add an encryption one other time on the denunciation side. [00:14:04] Speaker 04: Did you move for reconsideration? [00:14:06] Speaker 04: We did not. [00:14:07] Speaker 04: Do you have the ability to move for reconsideration in these circumstances? [00:14:10] Speaker 01: I think there's probably a legal ability and a practical ability. [00:14:14] Speaker 01: I think you're aware of the board's practical determinations on motion for reconsideration. [00:14:22] Speaker 05: I think they often deny them. [00:14:24] Speaker 05: They often write something. [00:14:27] Speaker 05: From your perspective, it may be an exercise in self-precipitation, but it is responsive, at least on paper, to what... We did not move for reconsideration. [00:14:38] Speaker 05: Let me ask you this. [00:14:41] Speaker 05: I don't want to use your bottle time. [00:14:44] Speaker 05: I'm here to be helpful. [00:14:45] Speaker 05: All right. [00:14:47] Speaker 05: This case is somewhat unusual in that Riverbed's not here. [00:14:49] Speaker 05: I don't know at what point Riverbed lost interest in this case. [00:14:53] Speaker 05: But at some point, I would assume that when you canceled the original claims, at least their interest in the case was abated. [00:15:03] Speaker 05: And they had less interest. [00:15:06] Speaker 05: judging from the fact that they no longer pursue the matter in the motion to amend and the amended claims. [00:15:16] Speaker 05: In this situation, I wonder if your argument about the board's not really being able to act as an initial fact finder on its own is somewhat attenuated. [00:15:31] Speaker 05: There may be, and I don't know whether this case really fully fits this pattern, but there may well be instances in which when initial claims are cancelled, the petitioner couldn't care less and disappears, but the board continues on on the motion to amend and the board has to make determinations somehow and [00:15:53] Speaker 05: comes up with its own determinations. [00:15:55] Speaker 05: What's wrong with that? [00:15:56] Speaker 05: I mean, I understand your argument that you didn't have an opportunity, but how would the board go about, in the change of rules, how would the board go about addressing the problem that they no longer have a petitioner with respect, making arguments with respect to the motion to amend? [00:16:14] Speaker 01: I think the guidance we have is from the statute and regulations, right? [00:16:19] Speaker 01: So it is supposed to evaluate that motion on the preponderance of the evidence. [00:16:23] Speaker 01: With you having the burden. [00:16:25] Speaker 01: With us having the burden. [00:16:27] Speaker 01: And what is unmistakable here is that the entirety of the evidence tips in only one way. [00:16:35] Speaker 05: Well, OK. [00:16:36] Speaker 05: But I actually want you to address, if you would, the more general problem of what is the board to do in a situation where the petitioner bails and the board is essentially on its own with [00:16:49] Speaker 05: the evidence that it has. [00:16:51] Speaker 01: It's a fair question. [00:16:52] Speaker 01: And I think there's two options, right? [00:16:55] Speaker 01: But one, the board can say, I'm going to be an examiner, and there's going to be an ongoing dialogue with the movement about whether or not their moving papers sufficiently convince the board of particular issues, and maybe it goes back and forth. [00:17:13] Speaker 01: Well, I think the board can [00:17:16] Speaker 01: Well, go ahead. [00:17:17] Speaker 01: I think there's two ways to end up on this. [00:17:20] Speaker 01: One is that way. [00:17:21] Speaker 01: And the other is, well, this is an adversarial proceeding. [00:17:27] Speaker 01: It is structured so that when the same way the other adversarial proceedings which come up before this court, when one party bails, then there's no real controversy in the movement prevails. [00:17:40] Speaker 01: Right. [00:17:40] Speaker 01: But the first course. [00:17:41] Speaker 05: seems to be more consistent with what the Supreme Court has recently told us about the board. [00:17:47] Speaker 05: And it's in a hybrid proceeding, which is partly adjudicatory and partly adversarial, and it's partly examinational. [00:17:59] Speaker 05: And it would seem to me that the examinational component would come to the fore in a situation such as the one that I presented. [00:18:07] Speaker 05: I'm not sure how well this case maps on that hypothetical, [00:18:11] Speaker 05: I can certainly imagine such a hypothetical coming up. [00:18:14] Speaker 01: Yeah, I certainly can imagine as well. [00:18:16] Speaker 01: I think the board needs to choose what role it's going to be. [00:18:19] Speaker 01: Is it going to be examinational, or is it going to be, or is it not? [00:18:22] Speaker 01: And the board has come up before this court and tells parties in front of it time and time again that it is not acting in an examinational manner. [00:18:30] Speaker 01: at the motion to amend stage. [00:18:32] Speaker 04: But did I hear you say that therefore, if the other side is dropped out, you move to amend and you automatically get it because there's no one on the other side? [00:18:40] Speaker 04: That it's kind of a default? [00:18:42] Speaker 04: Is that what you said? [00:18:44] Speaker 01: I think it depends on the nature of the evidence in front of the board. [00:18:52] Speaker 05: On which the board can make findings. [00:18:55] Speaker 02: You said that the evidence could only be viewed one way, but obviously it couldn't be, unless you're agreeing with the board. [00:19:05] Speaker 01: If I was unclear, I meant to say, on these particular facts, where the facts of this case are, we've got a patent over which this patent was previously laid out by the office, broader claims. [00:19:22] Speaker 01: We have one theory of non-obviousness presented [00:19:25] Speaker 01: by the petitioner that is relevant here, which is based on a white paper which was disqualified as being the prior printed publication. [00:19:36] Speaker 01: We have evidence from our expert which explains why the proposed substantive amended claims are patentable over the original references, which in large measure [00:19:55] Speaker 01: The board does not really challenge in its written decision. [00:20:01] Speaker 01: The board exclusively adopts a theory based on petitioners' white paper premise and substitutes in its own rationale for that. [00:20:12] Speaker 01: So I don't know if the right decision in all instances there would be that you just reverse and send it back, or it is by default [00:20:24] Speaker 01: in the situation where the non-movement steps out. [00:20:30] Speaker 01: But I think the better position overall, at least from what the board has told this court and what it has told applicants, is that it doesn't want to be in a situation to be an examiner. [00:20:43] Speaker 01: And I think given the structure of the process of an IPR with the board constrained by statute for completing these in a particular time period [00:20:53] Speaker 01: And so far, it's not in predilection to take its additional six months. [00:20:59] Speaker 01: The process is not set up in a way where structuring to tip the side on it being an examinational one in nature is going to give the patent owners any fair opportunity for deep process. [00:21:11] Speaker 01: I think the better position there is to go the other way. [00:21:14] Speaker 01: Thank you, Your Honors. [00:21:15] Speaker 01: Will we still have a minute of rebuttal? [00:21:17] Speaker 04: And let's hear from Mr. Hall. [00:21:21] Speaker 00: Thank you, may I please record? [00:21:22] Speaker 00: I'd like to start right where you ended. [00:21:26] Speaker 00: You can imagine the situation where somebody drops out of the inter-parties review and you end up with only one side, the patent owner, advocating for amended claims. [00:21:37] Speaker 00: In that situation, it cannot be the case that the board has to issue those claims. [00:21:41] Speaker 00: That just can't be right. [00:21:43] Speaker 02: Well, not only that. [00:21:45] Speaker 02: I mean, what I didn't ask your opposing counsel is if we agree [00:21:50] Speaker 02: that the board was right on its analysis of the facts and properly applied the law. [00:21:57] Speaker 02: We're still being asked necessarily to reverse it. [00:22:01] Speaker 00: That's correct, Your Honor. [00:22:02] Speaker 00: And I think this case, my understanding when I read the briefing is that the arguments they're raising really go more to the substantial evidence supporting the board's decision. [00:22:14] Speaker 04: But before we get to the substantial evidence, can you tell me, I mean, Judge Bryson, [00:22:18] Speaker 04: suggested that McCann was in play in this case. [00:22:21] Speaker 04: What are the limits on the board, when they've got a motion to amend and let's assume the other party's gone, for what they can draw from in order to base their decision where they've got no one giving them anything when the petitioners die? [00:22:35] Speaker 00: Well, I think there is an issue of due process. [00:22:38] Speaker 00: There is a due process issue that could come up. [00:22:40] Speaker 00: I don't think it is implicated in this case at all. [00:22:42] Speaker 00: But in decisions like Idle 3, what [00:22:46] Speaker 00: general process is that the board, the patent owner is supposed to come forward with the best evidence and defend against the best evidence that it has in the prior art. [00:22:59] Speaker 00: So come forward with all the prior art that's known to it, show the prior art that's in play in the examination and the review, and explain how their claims, their amended claims, their proposed amended claims are patentable over that prior art, or are patentable in general. [00:23:14] Speaker 04: But just to be clear, the board here didn't say you didn't adequately deal with the prior art of record, so you lose. [00:23:22] Speaker 04: The board itself looked at the prior art of record. [00:23:25] Speaker 00: That's exactly right. [00:23:26] Speaker 00: And not just the prior art of record, but you can see from the record in this case that there were many opportunities, or that the pattern owner availed himself of, to submit evidence about that prior art. [00:23:40] Speaker 00: So expert declarations, making arguments, motions, and so forth. [00:23:45] Speaker 00: So this doesn't seem like the type of situation where they weren't granted process. [00:23:49] Speaker 05: And the can was front and center, right? [00:23:51] Speaker 00: That is exactly correct. [00:23:53] Speaker 00: Yes, it's the whole way through. [00:23:55] Speaker 00: And in fact, when the review was, when the petition was first submitted, all the claims were canceled. [00:24:04] Speaker 00: All the existing claims were canceled. [00:24:06] Speaker 00: It was not a contingent cancellation, so they're gone. [00:24:09] Speaker 00: The only thing here is whether the amendment, the motion to amend will be granted. [00:24:14] Speaker 00: That's the only issue here. [00:24:15] Speaker 00: So it can't just be in play the entire time. [00:24:16] Speaker 05: At what point did Riverbed fail? [00:24:21] Speaker 00: I think it was after the board proceedings. [00:24:23] Speaker 00: So this is not the horrible case where you might imagine the pan owner, under their theory, the pan owner would get free reign to submit whatever amended claims that would be required to be granted. [00:24:35] Speaker 00: That's not the case here. [00:24:36] Speaker 00: I can't remember. [00:24:37] Speaker 04: But that gives him a stronger case, right? [00:24:39] Speaker 04: Because therefore, since the petitioner was still in play, [00:24:43] Speaker 04: through the proceedings, he was focused, as one might suggest one ought to be, on what the petitioner was saying and not necessarily the other prior art that the petitioner didn't raise. [00:24:54] Speaker 00: Certainly it is not that horrible case. [00:24:56] Speaker 00: But I do want to make a distinction from the cases that he cites, the Dell case or other ones in that line, in that those cases didn't, if I remember correctly, did not deal with motions to amend. [00:25:07] Speaker 00: Those are the primary case. [00:25:08] Speaker 00: And you can imagine in the primary case, it's much more of an adjudicatory capacity. [00:25:13] Speaker 00: The board is being asked to resolve this dispute between the two parties about whether this certain prior law reference based upon this certain theory that they granted the petition on, whether that is correct, which side is correct. [00:25:27] Speaker 00: Once you get into a motion to amend, the game changes, because the board is being asked to issue new claims, and they're asked to do it in one shot. [00:25:36] Speaker 00: And I think in ProxyCon, this is kind of the court [00:25:38] Speaker 00: kind of observe that this is the case and it's a slightly different situation. [00:25:44] Speaker 05: So you would endorse the view that the process becomes examinational, if that's a word, at that point? [00:25:53] Speaker 00: It is certainly more examinational than it is. [00:25:56] Speaker 05: But your opposing counsel said that the board had previously disclaimed any examination of role models. [00:26:03] Speaker 00: I'm not sure what he's talking about there, but I think that the board, there is a certain obligation. [00:26:08] Speaker 00: I think this is what the board recognizes in their cases, our Idleford cases and ProxyCon, that they have to make sure that those claims, they're issuing valid claims. [00:26:16] Speaker 00: They have an affirmative obligation. [00:26:18] Speaker 02: You'd have two possible realities. [00:26:21] Speaker 02: One is, [00:26:22] Speaker 02: that you would eliminate the possibility of filing a motion to amend, because the other one would be, when you file it, you get it. [00:26:33] Speaker 00: That's ridiculous. [00:26:34] Speaker 00: That's right. [00:26:35] Speaker 00: And just to be clear, as was alluded to, the burden is on the pan owner when filing these motions to amend. [00:26:43] Speaker 00: And they have to come forward and convince the board that the claim should issue over all the prior art. [00:26:48] Speaker 00: So it doesn't really make sense to say the board just throws up its hands and say, well, nobody's talking back to us. [00:26:55] Speaker 00: Or if, for example, in this case, Riverbed had not identified a piece of evidence in that prior art. [00:27:03] Speaker 00: Here's an example that is more extreme in this case, but I think still falls well within the realm. [00:27:10] Speaker 00: Prior Art discloses two embodiments. [00:27:12] Speaker 00: One of them clearly reads on the amended claims, but for some reason the petitioner only discusses the other embodiment, which is pretty good. [00:27:24] Speaker 00: The board says, look, even if we agree with you on the pretty good one, this other one clearly discloses it. [00:27:31] Speaker 00: We can't issue these claims because clearly it discloses it. [00:27:35] Speaker 00: The fact that they didn't raise that theory, that particular theory, on that same piece of prior art, the board is not under an obligation, doesn't have an obligation to issue the claims regardless, when it's clearly invalid on their face. [00:27:47] Speaker 04: You wanted, before we interrupted you, to deal with the substantial evidence question. [00:27:51] Speaker 00: Well, I'm happy to deal with the substantial evidence, but I do think it's important that I did want to raise it in the context of the fact that it is their burden in this case. [00:28:01] Speaker 00: And so with respect to the substantial evidence, [00:28:05] Speaker 00: disagree that the board somehow declined to look at the evidence they presented. [00:28:11] Speaker 00: It certainly looks like they, I mean, from their opinion, they go through and very carefully look at the expert reports and they either credit or don't credit. [00:28:21] Speaker 00: They believe or they don't believe what their expert is saying, but that's not ignoring. [00:28:27] Speaker 00: That is analyzing what the expert did. [00:28:29] Speaker 00: And in this case, I think it's pretty clear, based upon the generalized testimony from the expert and the particularized disclosure in the patent, that they have encryption at one of the transaction accelerators. [00:28:40] Speaker 00: This is the prior R patent application. [00:28:43] Speaker 00: That they do, in fact, use encryption at the transaction accelerator. [00:28:48] Speaker 00: Which transaction accelerator? [00:28:50] Speaker 00: Well, the board found that was explicitly disclosed for the sending transaction. [00:28:54] Speaker 00: That's correct. [00:28:55] Speaker 05: That's the problem. [00:28:57] Speaker 00: That's right. [00:29:00] Speaker 00: And I believe you made the argument. [00:29:02] Speaker 00: I'm not sure this argument was squarely made before the board that the prior art did not disclose sending original data. [00:29:10] Speaker 00: I'm not sure that was squarely made before the board. [00:29:13] Speaker 00: And of course, since it's their burden, they have to raise the issues that they think are not there. [00:29:16] Speaker 00: Regardless, the prior art does disclose a permissive. [00:29:20] Speaker 00: It's permissive whether or not you send your encrypted data. [00:29:27] Speaker 00: Actually, the disclosure is very similar in the prior art [00:29:30] Speaker 00: to the patent at issue. [00:29:32] Speaker 00: So the patent at issue, what they rely upon for their written description is, it says, quote unquote, which may be encrypted, when there's a data that's being sent, which may be encrypted, that's A475, line seven to 14, that's citing, and A63, column 11, lines 48 to 51. [00:29:49] Speaker 00: And then this is in the McCann prior art reference, it says at A975, paragraph 89, it says, rather than transmitting and cashing verbatim segments, the sending TA [00:30:00] Speaker 00: can transmit invertible functions of the segments, e.g. [00:30:02] Speaker 00: encryptions of segments. [00:30:04] Speaker 00: So it's the same type of permissive disclosure. [00:30:07] Speaker 00: So what's clear is that they do store the information. [00:30:13] Speaker 00: It does disclose, and I think everyone agrees, it discloses storing the information at the sending transaction accelerator. [00:30:19] Speaker 02: And that security of the data is a concern. [00:30:22] Speaker 00: That's right, and that was based upon the expert's testimony. [00:30:25] Speaker 00: In conjunction with the expert's testimony, [00:30:29] Speaker 00: uh... what's going on is that we know that encrypting data could secure data. [00:30:33] Speaker 00: So when the expert goes on and testifies to other things, you have an explicit disclosure that they store encrypted data. [00:30:41] Speaker 00: And the board said that this is motivation enough. [00:30:44] Speaker 00: This is showing that they were aware of security. [00:30:47] Speaker 00: Putting it at the receiving end, these systems are symmetric. [00:30:50] Speaker 00: So sometimes the sending receives and sometimes the receiving sends. [00:30:55] Speaker 00: And so you're storing the same data and [00:30:59] Speaker 00: in the same way, that's part of their findings, is that it uses the same type of lookup table, in the same way, at the receiving end. [00:31:08] Speaker 00: And so it just makes sense, if you want to protect it at the sending end, that you would also want to protect it at the receiving end. [00:31:15] Speaker 00: That's kind of the, it's a pretty straightforward finding by the board, or a pretty straightforward theory by the board, and I think it's well supported by substantial evidence. [00:31:27] Speaker 05: But again, at least in Mr. Donnelly's view of the way the McCann works, to the extent that it talks about encryption, there wouldn't be a problem with protecting the data on the receiving side because it would arrive already encrypted. [00:31:46] Speaker 00: That is, if you believe that the only thing, the way that McCann works, if you believe that the way McCann works is once it encrypts data, [00:31:56] Speaker 00: it always, it either, there's two possibilities, it either always sends the encrypted data, as opposed to sending the unencrypted data, or it encrypts the data, necessarily encrypts the data before it sends the data, right? [00:32:10] Speaker 00: So if it gets the data, it passes it on. [00:32:12] Speaker 05: So if it ever gets sent in encrypted form, then everything's fine, and it's all protected. [00:32:18] Speaker 00: That is also an embodiment disclosed in their patterns. [00:32:21] Speaker 00: So they have an embodiment that sends encrypted data as well. [00:32:26] Speaker 00: just as in their patent, in McCann, they have the possibility of sending unencrypted data. [00:32:32] Speaker 00: So there's two options, either they send the encrypted data or they send the unencrypted data. [00:32:38] Speaker 00: But when it's stored, it's not just, when it's stored, you can encrypt it at the other side. [00:32:44] Speaker 00: That's if you're sending it unencrypted. [00:32:46] Speaker 00: So that's the extent of the, [00:32:50] Speaker 05: Can I return you to the due process issue? [00:32:55] Speaker 05: Sure, of course. [00:32:56] Speaker 05: I'm really concerned about how far the board can go. [00:33:00] Speaker 05: We're going to go over already cloud ground, but I need a little more. [00:33:04] Speaker 05: Sure. [00:33:07] Speaker 05: Whether in the original [00:33:12] Speaker 05: proceeding with respect to the original claims, or where there's a motion to amend, how far the board can go in departing from the particular theories advanced by the petitioner. [00:33:26] Speaker 05: Now, I suppose it probably goes too far to say that the board can pull up its own prior art that has never before surfaced. [00:33:36] Speaker 05: And the board pops that out. [00:33:40] Speaker 05: basis its opinion on prior ethics never before the parties. [00:33:45] Speaker 05: How about when there is a new theory but the theory is based on evidence that was already before the board? [00:33:55] Speaker 05: How far down that line do we go without running into an APA slash due process problem? [00:34:01] Speaker 00: I think that there is a clear distinction between the case in chief versus the amended case because based upon [00:34:12] Speaker 00: I think there's a distinction. [00:34:14] Speaker 00: So I think that when you're dealing with the unlimited case, Dell seems to indicate, in SAS, the board can't spring things on the parties. [00:34:24] Speaker 05: Again, I don't... The word springs, spring things, is a good metaphor, but it doesn't really get to much by way of specificity. [00:34:32] Speaker 00: Right, and so I think in Dell it was a different... I think the facts in that case was it was a new theory about [00:34:40] Speaker 00: about what a certain disclosure meant. [00:34:44] Speaker 05: But it was a new theory based on an old disclosure. [00:34:47] Speaker 00: That's correct. [00:34:48] Speaker 00: That's correct. [00:34:49] Speaker 00: And that was no good. [00:34:50] Speaker 00: According to Bell, that's no good. [00:34:52] Speaker 00: I would say that in the amendment, in the motion to amend context. [00:34:59] Speaker 00: Just to be clear, I don't think that's what we have here because they really, what the board relied upon, for the most part, was the same expert testimony that was relied upon [00:35:09] Speaker 00: that they cited and was relied upon by the petitioner and their opposition. [00:35:14] Speaker 00: So that's not the case here. [00:35:17] Speaker 00: But regardless, I think in a motion to amend, the board has to have more leeway for the reasons that we discussed. [00:35:24] Speaker 00: These aren't existing claims. [00:35:25] Speaker 00: This is a chance to get claims. [00:35:28] Speaker 00: So when you're dealing with existing claims and parties come before you ask you to adjudicate the patentability of those claims, [00:35:38] Speaker 00: is a different situation than when you're being asked to, in one shot, issue new claims. [00:35:46] Speaker 00: To constrain your ability to look, at the very least, at the closest prior art of record and draw your own conclusions about that prior art doesn't make much sense in the context of what that motion to amend is. [00:35:57] Speaker 04: Can I just ask a follow-on, which is that you mentioned a few times, idle-free, and maybe I'm confusing this with something else, but there was a case named, I can't [00:36:06] Speaker 04: Remember, it followed... Real D, I think. [00:36:09] Speaker 00: I thought it was magic. [00:36:11] Speaker 00: Now that you've asked me, I'm happy with those. [00:36:15] Speaker 04: Don't say senior. [00:36:22] Speaker 04: I recall that the assessment of sum was that the board, in its second opinion, [00:36:31] Speaker 04: was cabining or pulling back a little on Idle Free and at least limiting us to a prior art of record. [00:36:37] Speaker 04: Is that your understanding of what we're talking about? [00:36:40] Speaker 00: I think it was the prior art of record and then any relevant art. [00:36:45] Speaker 00: So it was kind of the same duty of disclosure. [00:36:47] Speaker 00: It kind of, it folded into the duty of disclosure that ordinarily accrues to people practicing in front of the patent office or when you come before the patent office, which again makes sense. [00:36:56] Speaker 00: And the person seeking those claims should identify [00:37:00] Speaker 00: the closest prior art so that they can just narrow the dispute. [00:37:05] Speaker 00: So you don't have, you know, you see those IDSs in the file histories with thousands of entries. [00:37:12] Speaker 00: It's not that type of situation. [00:37:14] Speaker 00: It's to say, this is what we think is the closest prior art record. [00:37:16] Speaker 00: We're going to distinguish over that. [00:37:18] Speaker 00: So that's, that's, I think. [00:37:19] Speaker 00: Have you thought of the case yet? [00:37:22] Speaker 00: I'm not going to remember it. [00:37:25] Speaker 00: Sorry. [00:37:26] Speaker 00: So I can address the other, the one-on-one issue, if you like. [00:37:30] Speaker 00: I think people are interested in it. [00:37:33] Speaker 00: And it's awful, though. [00:37:34] Speaker 00: Thank you very much. [00:37:38] Speaker 01: Thank you, John. [00:37:38] Speaker 01: I'm not sure if I'm remembering correctly, but he is the master image. [00:37:42] Speaker 01: Yes. [00:37:42] Speaker 01: Just to address maybe a question you had, Judge Bryson. [00:37:47] Speaker 01: So what was going on in this case? [00:37:48] Speaker 01: Is there ongoing infringement litigation between the parties that infringement litigation [00:37:55] Speaker 01: was settled, and then Riverbed was opposite me throughout our argument. [00:38:01] Speaker 01: They were there arguing in Hammer and Tong when we were arguing this motion to a man. [00:38:05] Speaker 01: So they were certainly present. [00:38:07] Speaker 01: And going back to your question, what to do in this situation? [00:38:10] Speaker 01: Well, so I think in the situation where the board cannot decide the motion on the theories that were presented to it by the petitioner, it comes up with its own theory that it thinks [00:38:24] Speaker 01: is the only basis to decide it. [00:38:28] Speaker 01: Do what this court did 15 minutes ago. [00:38:31] Speaker 01: You call for additional briefing. [00:38:32] Speaker 01: You ask the Patent Office, do you want to submit an additional brief on this issue? [00:38:36] Speaker 01: In this situation, the Patent Office could do the same thing to us. [00:38:38] Speaker 01: They say, you know, we have our own theory here. [00:38:40] Speaker 01: The due process requires you to be allowed to address our new theory. [00:38:44] Speaker 01: Do you want to submit an additional brief? [00:38:45] Speaker 01: This is a perfectly acceptable procedure. [00:38:47] Speaker 04: Just to be clear for the record, it wasn't an analogous circumstance in that case. [00:38:51] Speaker 04: I appreciate you. [00:38:52] Speaker 01: Fair enough. [00:38:52] Speaker 01: But the opportunity to submit an additional brief is a way to address Judge Bryson's concern in the rare circumstance where the board can only decide a motion to amend on its own new theory. [00:39:04] Speaker 05: It does seem a little odd to say that an administrative agency acting, albeit under the APA, [00:39:09] Speaker 05: as well as due process, is much, much tighter handcuffs than we would, for example, because we would certainly be free to say, well, the Appellee's theory is all well and good, but we really don't think that's the best way to decide the case. [00:39:25] Speaker 05: The best way to decide the case isn't in the kind of theory, which may come as a surprise to the appellant, but it doesn't constitute a due process violation. [00:39:34] Speaker 01: I think in this instance, [00:39:37] Speaker 01: We do have due process constraints by the APA. [00:39:40] Speaker 05: But the due process ought to be pretty much the same between the two. [00:39:43] Speaker 05: The APA doesn't apply to us. [00:39:45] Speaker 05: Correct. [00:39:45] Speaker 05: But it basically just incorporates due process. [00:39:47] Speaker 05: It just strikes me as a little strange to say that the agencies are handcuffed, although there are other rules that treat agencies differently generally. [00:39:56] Speaker 01: I think fundamental fairness requires notice of what the theory is in opportunity to respond to. [00:40:03] Speaker 05: Well, again, if it's fundamental fairness, [00:40:05] Speaker 05: then why aren't we subject to that same rule? [00:40:10] Speaker 05: We ought to be fundamentally fair, you would think. [00:40:13] Speaker 01: I'm sure you would be fundamentally fair in this case. [00:40:18] Speaker 01: And I think this board has developed guidance for parties before it about when new issues can be raised and when issues that are not in the briefs [00:40:31] Speaker 01: are going to be taken up. [00:40:32] Speaker 01: And you can provide the same guidance to the Patent Office through decisions like this. [00:40:37] Speaker 01: I did want to address just one point, because I think my friend may have misspoken in his description of McCann. [00:40:44] Speaker 01: He referred to paragraph 89 of McCann on the JA-975. [00:40:51] Speaker 01: And he described McCann as being optional, so that you could encrypt and maybe or not send encrypted data. [00:41:01] Speaker 01: I think he described it as permissive. [00:41:04] Speaker 01: And if you look at that section in McCann, there's no permissive aspect about it. [00:41:12] Speaker 01: McCann says either I send, as it describes it, verbatim segments, i.e. [00:41:23] Speaker 01: segments that literally represent substrings. [00:41:26] Speaker 01: That is what would otherwise be original data. [00:41:32] Speaker 01: Or you're reading from paragraph 89? [00:41:34] Speaker 01: I am. [00:41:35] Speaker 01: And the point I'm trying to make is McCann says I can send original data or I can send encoded data. [00:41:43] Speaker 01: And the encoding is encryption. [00:41:46] Speaker 01: But it doesn't say I can encode and then say original data. [00:41:51] Speaker 01: If you're going to encode, this says I send encoded data. [00:41:55] Speaker 01: So if there's any encryption at all in McCann, that data is sent from the [00:42:02] Speaker 01: One transaction to the accelerator, to the other in transaction, accelerator, encrypt. [00:42:06] Speaker 01: It's the only way it works. [00:42:08] Speaker 01: Thank you for taking on both sides. [00:42:10] Speaker 01: The case is submitted. [00:42:11] Speaker 01: That concludes our proceedings for this meeting.