[00:00:00] Speaker 01: 2017-1384, Source Search Technology versus Kayak Software Corporation. [00:00:16] Speaker 01: No problem, take your time. [00:01:28] Speaker 01: Mr. Kaplan, please proceed. [00:01:31] Speaker 02: I'm sorry, Your Honor. [00:01:31] Speaker 01: I said Mr. Kaplan. [00:01:32] Speaker 01: You're Mr. Kaplan? [00:01:33] Speaker 01: Yes. [00:01:33] Speaker 01: Please proceed. [00:01:36] Speaker 01: No need to sit down. [00:01:37] Speaker 01: Just hop right up to the podium. [00:01:42] Speaker 02: Good morning, Your Honors. [00:01:43] Speaker 02: I'm pleased to court Jeff Kaplan on behalf of SST. [00:01:47] Speaker 02: In finding that SST's alice opposition brief depended entirely on contradicting its markman position, [00:01:54] Speaker 02: The district court committed a clear legal error that is best summarized in the sentence that bridges pages 54 and 55 of our appendix. [00:02:04] Speaker 02: There, the district court stated, quote, the 328 patents still needed to demonstrate an inventive concept, and the inventive concept is what SST effectively abandoned in its mark on position, unquote. [00:02:20] Speaker 02: This was a legal error for two independent reasons. [00:02:23] Speaker 02: First of all, the idea that a particular, let's get past the first step of Alice, that was an abstract idea, just focusing on the second step. [00:02:34] Speaker 02: The idea that a single step or even every one of the steps of the patent could be implemented using conventional servers and technology and software has been twice rejected recently by this court. [00:02:50] Speaker 02: once in the Bascom case that we discussed in some length in our brief, and again shortly after that in a case called Amdocs versus Open at 841 F3rd, 1288. [00:03:03] Speaker 02: So this concept that you admitted this step could be implemented with conventional software doesn't end the inquiry under the second portion of that. [00:03:11] Speaker 04: So what was the inventive concept here? [00:03:16] Speaker 02: The one we argued, Your Honor, brings me directly to the second [00:03:19] Speaker 02: the second reason why it was legal error. [00:03:22] Speaker 02: Let me first provide some background as to the prior art and then tell you the invention. [00:03:27] Speaker 02: The agreed upon abstract idea here was obtaining quotes from selected vendors. [00:03:33] Speaker 02: That had already been implemented in the prior art in two different ways. [00:03:38] Speaker 02: One was the central database system that we discussed in our brief. [00:03:42] Speaker 02: A second reference that's also implemented obtaining quotes from selected vendors or an attempt to do this [00:03:49] Speaker 02: was the FAST reference that is in this record. [00:03:52] Speaker 02: It's discussed a little bit at appendix pages 1490 to 91. [00:03:56] Speaker 02: And that reference was even closer to our invention, because they had a central computer. [00:04:01] Speaker 02: They had vendor computers. [00:04:03] Speaker 02: And they actually selected vendors at the central computer. [00:04:06] Speaker 02: They went out for the vendor computers and tried to get the quotes. [00:04:10] Speaker 02: Indeed, that reference in a prior appeal on this patent to this court [00:04:14] Speaker 02: at the district court level invalidated our patent and this court vacated that holding and the reason it vacated is the inventive step here. [00:04:22] Speaker 02: We argued to this court that FAST did not get the whole quote because since it didn't have the software interface that we're talking about, that tight interface, it had to just get a price and all the rest of the terms had to be negotiated separately over the network. [00:04:39] Speaker 02: So our inventive step, what we were saying was [00:04:43] Speaker 02: Look, there's an agreed upon abstract method. [00:04:46] Speaker 02: It's been implemented one way on a data network with computers. [00:04:51] Speaker 02: The problem is you have this big unmanageable central database. [00:04:55] Speaker 02: They've tried to do it another way where you leave the databases distributed and you go out to the vendors and get it, but because the central computer doesn't know [00:05:04] Speaker 02: each database structure, and on top of that doesn't know which terms go with which products. [00:05:09] Speaker 02: Remember, selling staplers and selling mortgages are going to be different material terms. [00:05:14] Speaker 02: Unless you have this set of tightly coupled software interfaces that you put in there, you can't get all the contractually material terms. [00:05:22] Speaker 02: And this court held that sufficient [00:05:25] Speaker 02: to vacate the summary judgment below in the fast. [00:05:28] Speaker 02: So that was the inventive step. [00:05:30] Speaker 03: What we were saying was... So the prior art was getting a quote, but it wasn't getting all the supplementary information along with the quote? [00:05:39] Speaker 02: I should be careful with the way I use the term quote. [00:05:41] Speaker 02: The prior art was getting, let me call it a quote prime. [00:05:45] Speaker 02: It was grabbing a price. [00:05:48] Speaker 02: Right. [00:05:49] Speaker 02: It was saying, you have widgets for two dollars. [00:05:51] Speaker 02: But it couldn't say, [00:05:53] Speaker 02: This vendor has widgets for $2, it's no return, the shipping charges are full, because it didn't have that type coupling. [00:06:00] Speaker 02: And this is all discussed at length in this Court's prior opinion in SST versus lending tree. [00:06:06] Speaker 02: That was the ground for vacating it. [00:06:08] Speaker 02: So our inventive step, and the reason we think the District Court committed error here, is we said, look, there's essentially other ways to put the same inventive concept, the same abstract idea on computer systems. [00:06:21] Speaker 02: One way is the central database. [00:06:23] Speaker 02: You use one database and the vendors upload in advance. [00:06:26] Speaker 02: You still implement that abstract idea on a computer system, but you have the problem of the unmanageable central database. [00:06:33] Speaker 02: There's another attempt to do it where you go out and you get what they call... I hear a lot of discussion about the facts, but you still haven't answered. [00:06:40] Speaker 04: What is your inventive step here? [00:06:42] Speaker 02: The use of a set of tightly coupled interfaces that are pre-arranged in advance [00:06:49] Speaker 02: to know in advance the material terms of each product and how and in what format they are stored in each vendor database, and to snuck that little interface in before you do it, rather than upload everything in advance like in the prior order. [00:07:05] Speaker 04: And where in your patent is that interface talked about? [00:07:08] Speaker 04: I'm sorry. [00:07:12] Speaker 02: It just talks about using, and that's another reason why we would never claim that the software was invented, because the software existed. [00:07:19] Speaker 02: It talks about doing it in our patent in several places. [00:07:24] Speaker 02: One place that I can point to right now is at Column 5, lines like 37 through let's call it roughly 47, 48. [00:07:37] Speaker 02: Well, the claims, the way it got into the claims, the claims just say, [00:07:47] Speaker 02: Obtaining by said filter means responsive to the filtering at least, I'm sorry, where? [00:07:54] Speaker 02: This is at appendix 85 and it's column two, I'm looking now at claim 12. [00:08:01] Speaker 02: Obtaining by the filter means responsive to the filtering from at least one of the potential sellers over a data network, quotes to supply the goods or services. [00:08:09] Speaker 02: And the quotes [00:08:10] Speaker 02: were defined in the Markman as not just the price, but the price and other terms of the transaction in sufficient detail to constitute an offer capable of acceptance. [00:08:20] Speaker 02: And so the patent talks at column five that you have to use software to cross-reference in to the vendor database. [00:08:27] Speaker 02: And that's a different way of doing it than making the vendor upload all those terms in advance to a single database, like the Dworken reference, or [00:08:38] Speaker 02: As in the fast reference, only being able to pull the price because you could find that and then having to do the other terms later. [00:08:44] Speaker 04: It all sounds like different software programs differently to get different types of information. [00:08:49] Speaker 04: I agree with that. [00:08:51] Speaker 02: I agree with that to this extent, Your Honor. [00:08:53] Speaker 02: I guess I would say I agree with that, but here's the point. [00:08:56] Speaker 02: The point is that the fast way of doing it was the prior art that this court held specifically because it could only get the basic information. [00:09:05] Speaker 02: It didn't have this tight coupling. [00:09:08] Speaker 02: that the prior ruling of invalidity was incorrect. [00:09:12] Speaker 02: So if I could turn back. [00:09:14] Speaker 04: Well, I understand all that. [00:09:16] Speaker 04: I don't understand why you're talking about obviousness in the prior court reference. [00:09:20] Speaker 04: I mean, the prior art could also be invalid under Alice. [00:09:24] Speaker 04: So the fact that you could get over it in terms of obviousness doesn't do anything for you. [00:09:28] Speaker 02: I agree with that 100%, Your Honor. [00:09:30] Speaker 02: But with due respect, I think that goes to a different issue. [00:09:34] Speaker 02: If that is correct. [00:09:37] Speaker 04: You talked about basically program software as your inventive concept. [00:09:44] Speaker 04: But when you were arguing for claim construction on a means plus function term, you said that that software was so known in the art that you didn't have to supply actual structure when you used means plus function claiming language. [00:09:59] Speaker 02: I disagree with that, Your Honor, for the following reason. [00:10:01] Speaker 04: Is it not true? [00:10:03] Speaker 04: that your expert testified that you didn't have to provide structure because anybody could program that software. [00:10:09] Speaker 02: That's true. [00:10:10] Speaker 02: The first part is the part I disagree with, which is we didn't argue in ALICE that there was something novel or inventive about the software. [00:10:17] Speaker 01: Didn't you say it was no small step, no small task, I think it was, to set up the software? [00:10:23] Speaker 02: In the patent office footnote, it says it's no small task because we're talking about what it takes to change the prior order. [00:10:30] Speaker 03: In the Alice motion, what we argued in the Alice motion... The Alice motion cited to that footnote in the office action response that we examined, which is the quote of, hey, this is no small task to build these specialized software interfaces. [00:10:45] Speaker 02: Among a litany of other sites, and if I had known that there was this alleged contradiction even, I probably would have just cited the other three. [00:10:52] Speaker 02: The point I'm trying to answer to Judge Hughes' question is that [00:10:56] Speaker 02: When I said before I disagree, I don't disagree that the experts said that in Mark where I disagreed, Your Honor, with the statement you made is we did not argue in ALICE that the software interface was some great novel thing. [00:11:10] Speaker 02: What we said was the use of that interface rather than a central database or a fast time system is the inventive concept. [00:11:20] Speaker 02: And again, even when Kayak and their ALICE greed said, well, you're just using [00:11:25] Speaker 02: standard software to do this interface, we never disputed it. [00:11:30] Speaker 04: That sounds like you're conceding under step one that your idea is abstract, but then saying under step two, even though it's abstract, the fact that you programmed it to get different information is somehow an inventive step. [00:11:47] Speaker 02: What I've said is the fact that I have gotten this information through the use of an interface whereas the prior art has gotten this information from a single centered database that requires uploading in advance and whereas the other prior art can't get the full information it requires a subsequent [00:12:12] Speaker 02: exchange of more information afterwards. [00:12:16] Speaker 04: Because it was programmed differently. [00:12:18] Speaker 02: Correct. [00:12:19] Speaker 02: But Your Honor, I would point out that in both the Bascom and the Amdok's case, there were explicit findings by this court that each and every step, that there was an abstract idea in the first step, and each and every step was implemented with conventional technology. [00:12:35] Speaker 02: We never disputed that. [00:12:36] Speaker 02: What we said was we put the interface in. [00:12:39] Speaker 02: And I want to make one overreaching point here, Your Honor. [00:12:42] Speaker 01: And that is... Before you go on, help me understand it. [00:12:45] Speaker 01: So this ALICE response is at page 1471. [00:12:48] Speaker 02: Correct. [00:12:49] Speaker 01: That's what we're talking about now. [00:12:51] Speaker 01: 1471. [00:12:52] Speaker 01: And you say an important aspect of the 328 is the specialized predefined software interface between the central computer and the vendor's computer. [00:13:03] Speaker 01: This specialized software [00:13:06] Speaker 01: We're talking about the software. [00:13:08] Speaker 01: And then the very next paragraph begins, the technology in the 328 thus represents a specific technical solution. [00:13:20] Speaker 01: So I understand your argument today, but I don't necessarily know how I can find that this fact finding, which I have to review for an abusive discretion, that this articulation in point 1471 [00:13:35] Speaker 01: represents an attempt by you all to claim that the specialized software is the technical solution that overcomes Alice. [00:13:43] Speaker 01: I don't review this de novo. [00:13:44] Speaker 01: This is a fact finding. [00:13:46] Speaker 01: I've got to look at what you said here and say, could the reasonable fact finder in this case come to this conclusion? [00:13:53] Speaker 01: Is there substantial evidence in what you said for the conclusion that you were relying on the software to attempt to overcome the Alice rejection? [00:14:03] Speaker 01: How do I not [00:14:04] Speaker 01: have to affirm that in light of your thus language beginning the second paragraph and your specialized software language in the paragraph proceeding. [00:14:12] Speaker 02: Okay, two reasons. [00:14:13] Speaker 01: Whether I agree with it or not. [00:14:15] Speaker 02: Two reasons, Your Honor. [00:14:16] Speaker 02: First of all, the finding upon which the exceptional case is based is that the Ellis opposition contradicted the markman. [00:14:24] Speaker 02: The paragraph you just read is copied from my markman brief. [00:14:28] Speaker 02: It's copied from it. [00:14:29] Speaker 02: Number two, Your Honor, if you look at the substantive arguments that were made [00:14:34] Speaker 02: for patentability, which begin at page 1475. [00:14:39] Speaker 02: The two methods are, the two arguments are, number one, there are other ways to do this without using the pre-distributed software-tied interface, and number two, that we solve a technical problem by rearranging the components, like Bascom. [00:14:57] Speaker 02: Nowhere in either of those arguments does it say, [00:15:00] Speaker 02: We've got this specialized software, and the improvement is better than some other software that's novel. [00:15:06] Speaker 02: The trial judge confused what we were arguing, which was the use of the software as opposed to two other ways of doing it, with the idea that the software itself was something novel or patentable. [00:15:19] Speaker 02: We never said that. [00:15:20] Speaker 02: We always agreed up front that the software was readily available. [00:15:24] Speaker 02: Even the patent says that. [00:15:25] Speaker 02: I think it may be in the court I cited you to before. [00:15:28] Speaker 02: We always agreed it was just suitable software that does database queries. [00:15:32] Speaker 01: OK, you're into your rebuttal time. [00:15:34] Speaker 01: Do you want to save some? [00:15:36] Speaker 02: Yes, I do, Your Honor. [00:15:37] Speaker 02: Thank you very much. [00:15:38] Speaker 01: Mr. Cotter. [00:15:46] Speaker 00: Thank you, Your Honors. [00:15:47] Speaker 00: John Cotter from K&L Gates, forward defendant Appell Lee, [00:15:50] Speaker 00: Kayak Software Corporation arguing for an affirmance of the District of New Jersey's judgment that this case was exceptional. [00:15:55] Speaker 01: So as I understand Mr. Kaplan's argument, he makes clear and concedes that in the Markman brief and elsewhere they argued that this software was routine, that they're expert did, and that what his argument really narrowly limited is [00:16:16] Speaker 01: is that in his Alice briefs, he just didn't say anything to the contrary. [00:16:20] Speaker 01: And thus, since this entire fee award is predicated on supposedly an inconsistency between the Markhamen opinion and the Alice brief, on page 18 of the appendix, that's the only thing it's predicated on. [00:16:34] Speaker 01: exceptional case finding is predicated on this. [00:16:36] Speaker 01: Can you just jump right to that and address why that fact finding is in fact supported by substantial evidence? [00:16:42] Speaker 01: And if you disagree with anything I said, please correct it. [00:16:44] Speaker 00: Well, there is a totality of the circumstances that the Court did consider, and they were all in the Court's mind. [00:16:49] Speaker 01: What else did the Court articulate as its basis? [00:16:51] Speaker 00: The Court articulated the flip-flopping between what went on during the Markman indefiniteness argument and the Alice argument on the [00:17:00] Speaker 00: specialized, pre-distributed software. [00:17:02] Speaker 01: And then said, the inconsistency is subtle, but it's apparent from the papers, and the only thing they cite is this. [00:17:09] Speaker 00: I agree with you. [00:17:10] Speaker 00: That's what the court cites. [00:17:10] Speaker 01: So subtle, but there. [00:17:12] Speaker 01: So it's not just generalized flip-flopping. [00:17:15] Speaker 01: That's not what they cited. [00:17:16] Speaker 01: They didn't say, you flip-flop all the time, you're a chameleon, you're constantly citing the wrong thing. [00:17:21] Speaker 01: Not in this fact-finding for exceptional case, they didn't say anything like that, did they? [00:17:25] Speaker 00: No, the court did not say that. [00:17:27] Speaker 01: This is not based on litigation conduct generally. [00:17:29] Speaker 01: It's based on a specific inconsistency. [00:17:32] Speaker 00: Well, that's what the court referenced in its decision. [00:17:34] Speaker 00: I agree. [00:17:35] Speaker 00: And the specific inconsistency is this. [00:17:38] Speaker 00: What happened is SST found itself in a position on 101 late in the case with the change law of Alice. [00:17:48] Speaker 00: Alice made clear that if you have an abstract idea, then [00:17:52] Speaker 00: software environment, which this claim is, that simply claiming generic software to implement that abstract idea is not going to satisfy Step 2, is not going to give you eligible subject matter. [00:18:07] Speaker 00: That was clear. [00:18:08] Speaker 00: SST was faced with that. [00:18:10] Speaker 00: And in the Alice motion, in its opposition to the Alice motion, SST cited the portion you referenced on page 1471, cited the [00:18:21] Speaker 00: predefined software interface and the arguments that SST had made in reexamination to get over prior art. [00:18:30] Speaker 00: SST cited to those. [00:18:32] Speaker 00: But then in its arguments, although it's talking about preemption, and I think in a way to avoid, really, the flat Alice requirement that if you're going to get past the abstract idea, you have to show it's implemented with something other than generic software. [00:18:49] Speaker 00: And the implementation [00:18:51] Speaker 00: that SST pointed to was the pre-distributed software. [00:18:55] Speaker 00: That pre-distributed software is cited not only on page 1475, but also, excuse me, 1471, but also 1475, and. [00:19:05] Speaker 01: Okay, what's the language of 1475 that you think demonstrates that they are hinging their Alice argument on the special nature of the software? [00:19:19] Speaker 00: citation that each of the claims that issue here, the second full paragraph on the page, each of the claims that issue here requires the system acquiring the required and available, quote, information from the vendor's product database using predistributed software, citing the Markman decision and several other points in the, in what was then called the Joint Appendix from the reexamination, including Footnote 4. [00:19:46] Speaker 00: the joint appendix at footnote, excuse me, joint appendix at 1478. [00:19:50] Speaker 00: That was a different set of numbers. [00:19:52] Speaker 01: Is footnote four that no small task thing? [00:19:55] Speaker 00: Yes, it is. [00:19:56] Speaker 00: And then SST goes on to explain in its 101 brief, in describing that footnote four, it says, explaining the requirement for the specialized predefined soccer. [00:20:05] Speaker 01: Where are you? [00:20:06] Speaker 00: I'm sorry, I don't mean to go too fast. [00:20:08] Speaker 00: 1475, middle of the page. [00:20:11] Speaker 01: Well, I'm at your footnote four. [00:20:13] Speaker 01: Is that not where were you just reading from? [00:20:16] Speaker 00: No, I was reading from Appendix 1475. [00:20:18] Speaker 00: Yep. [00:20:20] Speaker 00: Each of the claims paragraphs, the second full paragraph, getting to the parenthetical after the first sentence. [00:20:26] Speaker 00: Yes. [00:20:28] Speaker 00: And there's a citation to the footnote four. [00:20:31] Speaker 00: They're on the fourth line of that paragraph. [00:20:33] Speaker 00: That's a citation to the re-examination argument about no small task. [00:20:37] Speaker 00: And then SST adds the parenthetical in its 101 [00:20:41] Speaker 00: opposition, speaking of footnote four, explaining the requirement for the specialized predefined software interface to solve the database compatibility problem of the prior art. [00:20:54] Speaker 00: So, and then going on to cite another portion of the reexamination. [00:20:59] Speaker 01: I guess this is pretty flimsy, as far as I can tell. [00:21:02] Speaker 01: Pretty flimsy. [00:21:03] Speaker 01: I don't know that it's so flimsy that I can overturn the lower court. [00:21:07] Speaker 01: But in terms of claiming that this amounts to a direct conflict with the Markman brief, this particular language, I mean, the only good language I see is on 1471. [00:21:17] Speaker 01: Granted, there is a site to the footnote, therefore, at 1475. [00:21:22] Speaker 01: But boy, they don't even articulate the footnote. [00:21:25] Speaker 01: They don't even use the no small task language. [00:21:28] Speaker 01: It's in a long string site of one, two, three, four, five, six, seven different sites. [00:21:34] Speaker 01: You know, you're pulling from that footnote, and you're saying, aha, that footnote has the language that offers the conflict. [00:21:41] Speaker 01: And it's cited here. [00:21:43] Speaker 01: That's a flimsy little argument. [00:21:45] Speaker 00: I did not pull from it, of course. [00:21:47] Speaker 00: It was the District of New Jersey, an experienced court that handles lots of patent cases and saw what went on in this case and saw the contrast. [00:21:56] Speaker 01: First off, I don't know if this judge is an experienced judge who handles lots of patent cases. [00:22:00] Speaker 01: No doubt you do. [00:22:01] Speaker 01: But apart from that, [00:22:03] Speaker 01: You're saying he saw what went on in this case. [00:22:05] Speaker 01: He didn't cite anything that went on in this case. [00:22:08] Speaker 01: He cited this one contradiction as the basis for his exceptional case finding. [00:22:14] Speaker 01: He did not make a fact finding that indicates there was an overall course of conduct or litigation misconduct or abuse of his courtroom or this is the worst case I've seen in 30 years kind of thing, which we do see in these exceptional case fact findings. [00:22:28] Speaker 00: In some of them, of course. [00:22:29] Speaker 00: And in this one, that's not what the judge was relying on. [00:22:32] Speaker 00: The judge was relying on [00:22:33] Speaker 00: this particular flip-flop because it was at a pivotal point in the case. [00:22:37] Speaker 00: And SST, when faced with Alice, and now faced with an Alice motion, it had to deal with Alice. [00:22:44] Speaker 01: But he based an entire exceptional case finding on a single flip-flop. [00:22:48] Speaker 01: I understand your argument that it's a pivotal point in the case, but a single flip-flop. [00:22:52] Speaker 01: So I'm trying to make sure there really is a flip-flop. [00:22:55] Speaker 01: Yes. [00:22:55] Speaker 01: Because usually we have a course of conduct. [00:22:57] Speaker 01: Usually it's a lot more than a single misrepresentation. [00:23:00] Speaker 01: And what [00:23:01] Speaker 01: or inconsistent statement. [00:23:03] Speaker 01: And I guess what I'm struggling with is where precisely you think is the most poignant evidence in their ALICE brief that indicates there really was, in fact, a flip-flop. [00:23:15] Speaker 01: And so you pointed me to 1475, and I walked through it with you. [00:23:20] Speaker 01: Is there anything else in the ALICE brief that you think further reinforces the notion that they were stressing the software as a critical component to overcome the ALICE? [00:23:31] Speaker 00: Yes. [00:23:32] Speaker 00: On page 1479 of the appendix is a carryover paragraph. [00:23:39] Speaker 00: And I won't read the whole thing, you know. [00:23:41] Speaker 01: Just tell me which part you think is important. [00:23:42] Speaker 00: Write six lines, five lines down, starting at point three, actually at three lines down, going on to describe the pre-distributed software to overcome the interface problem as the known technical problem, citing footnote four among other [00:24:01] Speaker 00: sites, and then stating, far from claiming any generic computerized version of the method, the 328 file shows the method was already computerized and a specific inventive concept was added to overcome a technical database problem. [00:24:15] Speaker 00: The specific inventive concept argued during the reexamination was that the idea of reaching out to or sending specialized predefined software to vendors [00:24:31] Speaker 00: was that was the idea was depicted as the item, the technical thing that created the invention. [00:24:39] Speaker 00: And the implementation was stated very clearly by Dr. Pancha in his declaration that the implementation was well known and in use for many years. [00:24:52] Speaker 00: So he was talking about implementation. [00:24:54] Speaker 04: Isn't it possible that maybe the confusion [00:25:01] Speaker 04: on the district court's part here is that they agree that it's an abstract idea done in conventional means, which would normally fail Alice. [00:25:12] Speaker 04: And they're not trying to say it meets step two because of the specific programming, but just because it's such a fantastic abstract idea, it's in itself inventive. [00:25:23] Speaker 04: I mean, that argument is never going to win in most cases, but it seems like that's what they're arguing, that the specific [00:25:31] Speaker 04: combination of data and information that they were going to get through this conventional software programming was so innovative that nobody had ever thought of it that it should be eligible under ALICE. [00:25:45] Speaker 04: That argument doesn't seem to be inconsistent with the markman where they said it would be easy to program this idea. [00:25:53] Speaker 04: If that's the case, I don't see any real inconsistency. [00:25:57] Speaker 04: I see a [00:25:59] Speaker 04: argument approaching frivolousness in defending the Alice, but that's not what the district court relied on in awarding fees here. [00:26:08] Speaker 00: Well, I think it is inconsistent because the very statement, again, there are two parts to Alice. [00:26:15] Speaker 00: There's step one and step two. [00:26:16] Speaker 00: We all know that. [00:26:17] Speaker 00: Step one was conceded, now faced with step two. [00:26:21] Speaker 00: Had to show something under Alice that showed it was not generic software. [00:26:25] Speaker 04: Alice says... No, I think you're getting step two wrong. [00:26:27] Speaker 04: I don't think step two means you have to show something, if we're in software realm, that it's not generic software. [00:26:34] Speaker 04: I think you have to show that for some reason the abstract idea is otherwise innovative and a technological advancement and is still eligible despite the fact that it can be programmed using conventional software. [00:26:52] Speaker 00: Respectfully, Judge Hughes, I disagree. [00:26:53] Speaker 00: I believe Alice is crystal clear. [00:26:56] Speaker 04: to me on, uh... You are about the first person that has said that Alice is crystal clear. [00:27:04] Speaker 00: Well, on that, on that... I doubt your credibility on that. [00:27:07] Speaker 00: At that one point, Your Honor, that one point that's, if step one is, if it's abstract, then generic software isn't going to do it. [00:27:15] Speaker 00: It says that, as I read it, on 134 Supreme Court 2352. [00:27:20] Speaker 00: I know there's other discussion in Alice [00:27:24] Speaker 04: But yeah, I mean, I think in the context of Alice, that may be true. [00:27:27] Speaker 04: And why I tend to think that that argument approaches frivolousness even in this case. [00:27:35] Speaker 04: But it does mean that he's making a different argument than the argument he was making at Markman to me. [00:27:43] Speaker 04: It means he's making a really, really poor Alice eligibility argument. [00:27:48] Speaker 04: But the district court didn't rely on [00:27:51] Speaker 04: the weakness of the Alice argument relied on the apparent conflict. [00:27:56] Speaker 04: And I'm not sure I see an apparent conflict. [00:27:58] Speaker 00: Well, the district court did. [00:27:59] Speaker 00: And in its discretion, it pointed to specific places it saw that apparent conflict. [00:28:04] Speaker 00: And I do submit under the two-step analysis of Alice and comparing that to what was said in Markman, it is a clear contradiction. [00:28:15] Speaker 00: And when you look at the Poncha Declaration. [00:28:18] Speaker 01: Well, actually, the district court said the contradiction is subtle. [00:28:20] Speaker 01: He didn't say it was clear. [00:28:22] Speaker 01: Subtle. [00:28:23] Speaker 00: Subtle but apparent? [00:28:24] Speaker 01: Subtle but apparent. [00:28:25] Speaker 01: So I don't think it's a clear contradiction would even be his characterization. [00:28:29] Speaker 00: It's subtle but apparent. [00:28:32] Speaker 00: And the apparent is, if you go back to the Poncha Declaration, he's talking about implementation of the idea. [00:28:38] Speaker 00: He says the implementation of the idea is known [00:28:44] Speaker 00: known as someone with a basic software background and known for years. [00:28:51] Speaker 00: So that implementation is something that SST was relied on in the places I cited to, in the argument and in the brief, in its 101 argument. [00:29:01] Speaker 00: And SST was faced with that and had to try to come up with an idea, I mean, a concept to get around Alice. [00:29:07] Speaker 00: And instead of facing Alice, it tried this effort to take that implementation and say that that implementation [00:29:14] Speaker 00: didn't preempt, that that implementation did get over the prior art. [00:29:19] Speaker 00: And that was SST's effort on Alice. [00:29:22] Speaker 00: And instead of facing the issue squarely and ending the case, we ended up with another many months of litigation and significant expense. [00:29:31] Speaker 00: And SST did not appeal the 101 decision. [00:29:34] Speaker 00: It did not appeal any of the findings or conclusions of that decision. [00:29:38] Speaker 00: And those are binding on it. [00:29:40] Speaker 00: And at [00:29:40] Speaker 00: doesn't necessarily mean it made a, a, it doesn't necessarily characterize the quality of its argument, but it does show that anything SST is trying to do to point fault in what the district court did in 101, it really isn't, doesn't stand on good ground for doing that on this appeal from the exceptional case determination. [00:30:04] Speaker 00: So it, it, it, you know, to sum up with the, the short time I have left, [00:30:09] Speaker 00: In this case, it is an abusive discretion standard. [00:30:12] Speaker 00: And as Judge Moore recognized, it's a highly deferential standard of review. [00:30:17] Speaker 00: And indeed, deference to the trial court is the hallmark of abusive discretion review. [00:30:22] Speaker 00: And the trial court here saw the record, read the record, heard the arguments, considered all the facts and all the law, and made a determination that, in its view, there was a contradiction, subtle though apparent. [00:30:35] Speaker 00: And I believe the record supports that. [00:30:38] Speaker 00: as you read what SST filed in its Alice opposition. [00:30:43] Speaker 00: If there are no more questions. [00:30:44] Speaker 01: Okay. [00:30:44] Speaker 01: Thank you, Mr. Cotter. [00:30:45] Speaker 01: Mr. Kaplan, you have some rebuttal time. [00:30:48] Speaker 01: Mr. Kaplan, please bring your appendix up with you. [00:30:51] Speaker 01: You told me that 1471 appendix, that paragraph that I was asking you about, which is what the district court cites as offering the inconsistency, [00:31:00] Speaker 01: was cut and paste. [00:31:02] Speaker 01: I think those were your words from your Markman brief. [00:31:04] Speaker 02: I'm sorry, I didn't hear, I'm not hearing the list. [00:31:06] Speaker 01: I think you said it was cut and paste from your Markman brief, so how could it be inconsistent with the Markman brief? [00:31:10] Speaker 01: Do you remember saying that? [00:31:11] Speaker 02: Parts of it were copied with some, I think we said some stylistic changes, yes. [00:31:15] Speaker 01: Okay, well I just went back and looked at your Markman brief. [00:31:19] Speaker 01: Are you talking about page 100 of the appendix? [00:31:22] Speaker 01: Is that the portion of the Markman brief that you [00:31:24] Speaker 02: Are referencing that it was cut and paste from portions were cut and pasted from 100 through 102 and your honor if I could complete the thought Mr. Carter when he stood up here pointed you to the use of the specialized software to do the database interface in the Alice as the inconsistent statement if you read pages 100 and 102 of the appendix and [00:31:46] Speaker 02: It also talks about the use of a specialized argument. [00:31:49] Speaker 02: In 102, it specifically talks about this database interface problem that it's solving. [00:31:54] Speaker 01: No, but I think you misunderstand, Mr. Kaplan. [00:31:57] Speaker 01: I'm not seeking to have you address the merits of the argument. [00:32:00] Speaker 01: I'm seeking to ask you why I shouldn't sanction you for misleading the court in your oral argument. [00:32:05] Speaker 01: I'm sorry, Your Honor? [00:32:06] Speaker 01: I'm asking you to justify the statement you made in oral argument, which I do not believe to be factually accurate. [00:32:12] Speaker 01: You stood in front of me in oral argument and suggested that [00:32:16] Speaker 01: What appears in 1471, the precise language I was questioning you about, was identically present in your Markman brief. [00:32:23] Speaker 01: And therefore, how could you possibly have said something contradictory when you cut and pasted it from your Markman brief into your Ellis brief? [00:32:31] Speaker 01: And I'm looking at the pages of your Markman brief, and I see none of the language in that paragraph present identically. [00:32:38] Speaker 01: And there are only the picture copied. [00:32:40] Speaker 01: So I'm trying to ascertain that missing something in your Markman brief [00:32:44] Speaker 01: Or did you misrepresent to me an oral argument what actually had occurred? [00:32:49] Speaker 02: I didn't complete what I should have completed, Your Honor. [00:32:51] Speaker 02: And thank you for pointing that out. [00:32:52] Speaker 02: And I apologize. [00:32:54] Speaker 02: What I meant to say is we did take the image and the text below and copy it right in when we started the Alice brief. [00:33:01] Speaker 02: Then we began wordsmithing to do the Alice brief. [00:33:04] Speaker 01: The text right below was not copied in. [00:33:06] Speaker 02: The technology in the 328. [00:33:10] Speaker 01: The very next sentence is not there. [00:33:11] Speaker 01: None of the sentences are there. [00:33:13] Speaker 01: I can't find any of them. [00:33:14] Speaker 02: Are you referring to the technology in the 328 patent? [00:33:17] Speaker 01: You told me you took page 1471, and what I was reading to you from it, an important aspect of the 328 is a specialized, predetermined, or predefined software interface. [00:33:29] Speaker 01: This specialized software, yada, yada, yada, the technology in the patent thus represents a specific technical solution. [00:33:36] Speaker 01: And you told me all of that was cut straight from your marketing book. [00:33:39] Speaker 01: So I'm looking. [00:33:40] Speaker 01: at page 100, and I don't see any of the language about the specialized predefined software, the very language that I was quoting to you, that the district court quoted. [00:33:48] Speaker 01: I don't see that in the marketing brief here, and I'm wondering if I missed it. [00:33:51] Speaker 03: I don't see a citation to the Office Action Response where, footnote four, where you proclaim there was no small task to greet these software interfaces either. [00:34:00] Speaker 03: I don't see anywhere where it says the technology of that software is a specific technical solution in this marketing brief. [00:34:08] Speaker 02: Your Honor, what I said in my brief is what I intended to say here today. [00:34:12] Speaker 02: And if it wasn't clear, it was wrong. [00:34:15] Speaker 02: What I intended to say, and what I say again what happened, is when we started preparing the Atlas brief, we copied the figure in the text below it from the markman, and then we started wordsmithing. [00:34:25] Speaker 02: And if you read below the figure in the Atlas brief, an important aspect of the 328 invention is the specialized predefined software interface. [00:34:33] Speaker 02: If you read below the figure at page 100, [00:34:37] Speaker 02: An important aspect of the 328 invention is the special interface labeled above. [00:34:41] Speaker 02: So we definitely tweaked it. [00:34:42] Speaker 02: I should not have said that it wasn't tweaked. [00:34:45] Speaker 02: And I even said in the brief that it was copied and then some stylistic alterations or non-substantive alterations. [00:34:52] Speaker 01: When you say non-substantive, the word software doesn't appear anywhere in Page the Markman brief under the picture. [00:34:58] Speaker 01: And yet, that's exactly what the district court said was the problem. [00:35:02] Speaker 01: the word software, you were flip-flopping on how important it was. [00:35:06] Speaker 01: And none of the citations are here. [00:35:09] Speaker 01: While you may have been a little more careful in your brief than you certainly were here in oral argument. [00:35:15] Speaker 02: Your Honor, it does say software at page 102. [00:35:18] Speaker 02: The three-to-eight patent required some additional software to set up interfaces between the central computer and database computers. [00:35:25] Speaker 02: And all I intended to say was that the same stuff was copied and then maybe wordsmith in the Alice. [00:35:32] Speaker 02: But the stuff that Mr. Cotter pointed to about use of the specialized software being the inventive step to solve this database interface problem, if you read 100 and 102, that is what we said there, compared with prior... Well, your time is up, Mr. Kaplan. [00:35:47] Speaker 01: We've got your argument under submission. [00:35:49] Speaker 01: I thank both counsel and the cases submitted. [00:35:52] Speaker 02: And I just want to apologize for that. [00:35:54] Speaker 02: I didn't intend to. [00:36:00] Speaker ?: I don't know where the Germans were. [00:36:03] Speaker ?: I don't see them.