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Next case is Utility Associates versus Digital Ally 2016-16-26.

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Mr. Schutsel.

[00:00:52] Speaker 00:
Thank you, Your Honor.

[00:00:53] Speaker 00:
Good morning.

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May it please the Court.

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We asked today to highlight three points from the briefs in this case.

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First, that digital changed its theory in the conduct of the IPR.

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Second, that the board's decision as to what information travels on line 235 is an error and should be reversed.

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And finally, that the Monroe 320 reference does not anticipate.

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First, a little bit of background.

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Digital's petition in this IPR contended that the claimed invention of the 556 patent provided that all information was integrated and stored data, a data stream that was stored in a storage unit in the vehicle and transmitted or transferred to a second location.

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Reading from page two and three of the petition in terms of the summary and the invention, they stated.

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What page in the joint appendix are you reading from?

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Appendix 72 and 73.

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Thus, the 556 patent is directed to a surveillance system that captures video, audio, and data information, multiplexes the information to obtain one data stream, and stores the data stream in a storage unit.

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Skipping a paragraph and moving to page 73, when the mobile unit in which the surveillance system is installed returns to its home base,

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For example, when a police car goes back to the precinct, the information stored in the permanent storage memory can be dumped to a remote storage depository.

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This may be accomplished by either wired or wireless connection.

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We've checked their petition.

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We've not find the word live to appear anywhere in that petition.

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We've not find the word live transmission to appear anywhere in that petition.

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We've not found live views to appear in that petition.

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Digital challenged these claims on grounds that Monroe disclosed the identical information of storing and transmitting all data from storage, the data stream, to a second location.

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In our response, we demonstrated that Monroe did not store and transfer all data.

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There was no anticipation.

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There was no identity of invention.

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We showed that while Monroe 320 could deliver all data, all video, audio, and digital data to the recorder, and this is an airplane, the recorder 70 is simply the black box.

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All information could go to the so-called black box.

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That would occur on line 233.

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When that data was retrieved for any transmission on line 235, the audio would be stripped out.

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Because as shown in figure 15 of the Monroe reference in an unnumbered line, that information travels from the transceiver back through the image mux where the audio would be stripped.

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As a result, all of the data would not be transferred from the recorder to a second location.

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At that point in time, digital adopted a new theory.

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where their petition addressed the 566 information in terms of a data stream that was first stored and then transferred, digital manufactured a quote-unquote live transmission embodiment.

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There's no mention of a live transmission embodiment in the petition.

[00:04:38] Speaker 02:
The patent talks about live transmission, right?

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The patent does talk about live transmission, Your Honor, and the transmission that is referenced there are views, live views, packets of data.

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Data that is neither integrated nor stored.

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And it's different from the data stream, which is integrated and stored data.

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Yes, the patent references... We know it various ways.

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First, we know it because claim language differentiates between the two.

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I would refer the court in particular to claim seven of the patents.

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Claim 7 clearly draws the distinction by saying, in reference to multiple dependency to claim 1, a wireless device for transmitting at least some of the captured information from the server to the second location when the server is remotely located from the second location.

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So at a remote location, you can get a live view by transferring some of the information.

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At least.

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I'm sorry?

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At least.

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At least.

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But it continues.

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So maybe all.

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Not necessarily all.

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Not necessarily.

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In fact, I don't believe it is all.

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But if you say at least some, you are including the possibility of all.

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I think not, Your Honor, because data stream is what talks about all.

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And the next line says an ethernet, or the next element, an ethernet controller for transmitting the data stream to the second location when the server is located at the second location.

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And with reference to the patent,

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I'm sorry, why do we know Claim 7 is a live transmission embodiment?

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The first is not a live transmission embodiment.

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What we know from Claim 7 is the patentee drew a distinction in response to your question between data, some data that could be sent live, and a data stream that included all of the data that was integrated and stored.

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That's what's demonstrated so clearly by Claim 7.

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So Claim 7 represents the embodiment.

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I asked if you thought Claim 7 represents the live transmission embodiment, and you're saying it's not?

[00:07:00] Speaker 00:
No, because the live transmission embodiment, as it's used in the petition here, is that all data would be transmitted live, which I believe is just... But I'm just trying to talk about the patent.

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You told me initially that the live transmission embodiment disclosed in the patent is not disclosing all of the captured data that's represented by the data stream.

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And then I asked you, how do we know that?

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And then you pointed me to claim seven.

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I may have misspoke, Your Honor.

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I did not mean to say that there is a live transmission embodiment disclosed in the patent.

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I do not believe that there is a live transmission embodiment disclosed in the patent.

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What I intended to say is that in accordance with column five lines 45 through 50 roughly, you can transmit a portion of the data which are video audio information packets to the home base.

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But that is different from transmitting live the data stream which is the integrated and stored video audio

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and digital data.

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That distinction is what's shown in Claim 7.

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There are still other reasons, however, that we know that there is a distinction between the two.

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As discussed in the briefs, much is made and we believe there is a difference between, in this case,

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IE or that is and EG the example Latin abbreviation.

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Here we have the use of IE and we have it only one time and it's used to define the stored and integrated data stream information.

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It's used to define the data stream.

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There are other times in the patent when EG is used but EG in those other times is used to indicate an example

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That's what differentiates this patent from the dealer cast case that they rely on.

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In dealer cast, IE was used so frequently, so many times, that it effectively was converted to EG.

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That didn't happen here.

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The patentee was careful to use IE to indicate exactly the stored and integrated data stream that was being defined.

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Another reason that we know the difference between these

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is the claim language itself.

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Claim one, for example.

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It recites a server for digitally integrating the captured information in and to one data stream and storing the data stream in the emergency response vehicle.

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It carries on and in the wherein clause limits the claim to the server is operated to transfer the data stream from the emergency response vehicle to a second location.

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If something is going to be transferred from somewhere, it must first be present there.

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Here, that information, that data stream, must first be present in the vehicle.

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It must be stored in the vehicle, and then it is transferred.

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And so the new argument that was created was this idea that the information does not need to be first stored.

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It could just be the entire information, the data stream, could be directly transferred.

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Is it your view that

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Data stream doesn't exist until it's stored?

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It's our view that the... It exists first, right?

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That all the information is captured and multiplexed together into a combined data stream, right?

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And then the data stream is stored.

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So the data stream exists before it's sent off to storage in the emergency response vehicle.

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I recognize

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Your Honor's question to parrot some of the language that is in the patent.

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It does talk about it, and they rely on that sentence, that it is then stored.

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However, our position is that in this instance, the patentee defined data stream to be not merely integrated, but integrated and stored.

[00:11:27] Speaker 01:
Counselor, you're into your rebuttal time.

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You wish to save it.

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You may continue, or we'll save it for you.

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I'll very quickly address one other point, and that is the board's error in reference to what is on line 235.

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In the board's opinion, both in rehearing and its primary decision, the board relied on Monroe at column 23, lines 17 to 33, to determine that

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some data or selected portions of data, if you will, could be transmitted live.

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What happens in line 17 to 33 is that a command is sent from the cockpit monitor.

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The cockpit monitor gets only video information.

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That command goes to the controlling device, or the programmer, and it

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takes the information via, if you look in the drawing, line 243 to control the data that goes back up to line 231.

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Line 231 carries only video information.

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The monitor accepts only video information.

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The audio is up at 247.

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It's separated out.

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In other words, the support being given by the board for what travels on line 235

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actually refers only to what happens on line 231.

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And what happens on line 231 is video out to the video monitor.

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That's not proper support.

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That's a misunderstanding of how Monroe teaches and what Monroe discloses.

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And so therefore, we submit that the board's opinion should be reversed because they've miscomprehended how Monroe operates.

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Thank you, Your Honor.

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I'll save the remainder of my time.

[00:13:32] Speaker 01:
We will save it for you, Counsel, Ms.

[00:13:34] Speaker 01:
Bailey.

[00:13:42] Speaker 04:
Thank you, Your Honors.

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May it please the court?

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I want to address first the waiver issue that's presented in our briefing and then go back to the issues that Mr. Schechel presented.

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First, utility presents five issues for the court's consideration.

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Of those two issues, there are two issues that you just heard.

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Those two issues have been completely waived.

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They are completely based on new arguments that utility presented during the oral argument in the IPR and in the request for rehearing filed by

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And I want to be clear regarding these arguments.

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They did submit in their patent owner response the claim construction that they propose now, and they did submit that Monroe 320 does not teach transmitting all of the information to the remote location.

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However, every underlying theory, proposition, or argument for these two overarching assertions were newly presented during the oral argument.

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They have abandoned every argument that was presented in the patent owner response for the present appeal.

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And all of the arguments for these issues in the present appeal were newly presented during the oral argument and the request for rehearing.

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The board also confirmed this in the decision denying the rehearing request repeatedly.

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And I refer the court to A3, 5 through 7, and 9.

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The court repeatedly identified the new oral arguments and cited to the Office's Patent Trial and Practice Guide

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where such new oral arguments should not be considered.

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Utility also even acknowledges in its reply brief at pages six through seven these new arguments, but justifies the new arguments stating that it provided, quote, further support at oral argument for its positions, and that, quote, timing of the arguments below is of no moment.

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And I disagree with that.

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This is problematic for Digital Ally because we have had no opportunity to respond to these new arguments.

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And more importantly, we did not have an opportunity to develop any rebuttal evidence regarding these new arguments.

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The parties need to end up at the oral argument in the IPR with the same record evidence that they developed during the briefing stage and throughout the IPR.

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And I would also refer your honors to the recent decisions in MCM and Dell that discuss this.

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This is also not a situation where perhaps one or two of the supporting arguments are new in either the oral argument in the appeal.

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Again, every single argument on these two issues was brand new in the oral argument.

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And then this is also not a question where utility denies that the arguments are new.

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Instead, the question is whether a party should be able to present new arguments at the IPR oral argument and in the request for a hearing and then rely on those arguments in the appeal

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the answer to that question is no.

[00:16:32] Speaker 02:
I'm sorry, which are the arguments that we're debating over?

[00:16:36] Speaker 04:
Yes, the two arguments are the claim construction issue, so whether the claims recite transmitting the data stream from storage in the vehicle as opposed to transmitting the data stream from the vehicle.

[00:16:48] Speaker 02:
The board reached that issue, right?

[00:16:50] Speaker 04:
The board reached that issue, and that's to my earlier point, Your Honor, where they made the overarching claim construction in their patent owner response, but all the supporting arguments

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for that overarching claim construction have changed or were changed in the oral argument and in this appeal.

[00:17:06] Speaker 03:
Besides claim construction, what is the other?

[00:17:09] Speaker 04:
The other is that Monroe 320 does not teach transmitting all of the data to the remote location.

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And those are the two arguments that Mr. Schachtel presented just a few moments ago.

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So putting aside the question of, I don't know,

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waiver late making.

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Where in your petition did you identify Monroe sending a whole of the data to the remote location without going through the storage?

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So I will refer your honors to

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It's in our claim mapping beginning at 1 0 5.

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867 is the reference to Monroe 320.

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And in our petition.

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Oh, I have it here, your honor.

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The claim mapping beginning at A105.

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Apologies.

[00:19:02] Speaker 04:
So two points to your issue.

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First, we did not change our claim construction.

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If you look at our claim construction in the petition.

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Put aside claim construction.

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I'm asking about Monroe.

[00:19:13] Speaker 04:
Yes.

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Where do we recite that or disclose that Monroe teaches transmitting all of the information to the remote location?

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Without going through the storage device on the claim.

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So we do not contend that Monroe

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that the claims require going through the storage device.

[00:19:30] Speaker 03:
Right.

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I'm sorry.

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We're talking at cross purposes.

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Assume for purposes of this question that I agree with you that the claim construction does not require the transmission to the remote device to originate in the storage.

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That a transmission can go to both places, remote, onboard storage.

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Assume I agree with that.

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Where did you say in your petition

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that under that claim construction, Monroe shows that element.

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And the whole thing.

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The whole thing.

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I refer, Your Honors, to A105.

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And this will also refer back to Monroe at the bottom of column 22, where it begins, each sensor device signal is input into the multiplexer.

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So column 22 of Monroe, and this is A866.

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This is also referenced in our petition at A105 in the claim mapping.

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Begins, each sensor device signal is introduced into a multimedia multiplexer network.

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It then goes on to say it produces a combined comprehensive output signal as selected on each of lines 231.

[00:20:45] Speaker 03:
Can I just ask you this?

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Show me, because I'm not seeing it, on 105 where you referred to column 22 of Monroe.

[00:21:01] Speaker 04:
So this was actually, I now understand your honor's question.

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This was actually brought up by the board.

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And the board said that we did identify column 22 in our petition.

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And that with respect to that particular mapping.

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There is the third line from the top of 22, from the top on page appendix 105, sites 22, but not for this point.

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The boxed point talks only about some material on column 23 and column 14 and some figures.

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So I would also refer to a 103 and 104, which quotes pretty much that mapping there, quotes pretty much this entire paragraph.

[00:22:04] Speaker 04:
Do you have any further questions on that, Your Honor?

[00:22:06] Speaker 03:
No, that's fine.

[00:22:08] Speaker 04:
Okay.

[00:22:09] Speaker 04:
So we briefly discussed the waiver issue.

[00:22:12] Speaker 04:
This change of claim construction and then this discussion of the live embodiment and that live is not talked about in our petition.

[00:22:20] Speaker 04:
Live was mentioned and brought up and has become an issue in this case because utility mentioned it and brought it up during the oral argument.

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And what happened during the oral argument is the patent board essentially caught on to that argument and started asking the utilities council regarding, well, isn't there a live embodiment disclosed?

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And remember, we're talking about this live embodiment because utility wants to read out.

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It wants to not apply the broadest reasonable interpretation into the claims and construe the claims to only cover this data dump embodiment, this idea that the data stream has to be stored

[00:22:58] Speaker 04:
and that the data stream is stored and then transferred to the remote location.

[00:23:02] Speaker 04:
That's referred to in the briefing as the data dump embodiment.

[00:23:05] Speaker 04:
Part of why this live issue in live transmission has become an issue is because during the oral argument, the board said, well, but isn't there a live transmission embodiment disclosed?

[00:23:16] Speaker 04:
So that's how we got to this question of live transmission.

[00:23:21] Speaker 04:
And I just wanted to comment on that because Mr. Schoestel said that we did not discuss it in the petition.

[00:23:26] Speaker 04:
We did not discuss it because we did not believe that a clean construction required storing the or transmitting the data stream from storage.

[00:23:33] Speaker 03:
But the description right at the beginning of the petition, the kind of summary description of what the patented issue is about sure reads as though it's a description of putting stuff in storage and sometime later taking it out of storage to send somewhere else.

[00:23:52] Speaker 04:
We don't disagree that that is an embodiment disclosed.

[00:23:55] Speaker 04:
The issue is, what is the broadest reasonable interpretation of the claims?

[00:23:58] Speaker 04:
And the plain reading of the claims says transmitting the data stream from the vehicle.

[00:24:03] Speaker 04:
Another feature of this invention is the idea that you can capture this data in a mobile environment.

[00:24:10] Speaker 04:
So it makes sense that the claims recite that you're going to capture the data in the mobile environment, in other words, the vehicle, and transmit it from the vehicle to the remote location.

[00:24:19] Speaker 04:
So I don't disagree with you that the

[00:24:22] Speaker 04:
that the 556 patent discloses and talks about storing in the vehicle.

[00:24:27] Speaker 04:
But it also talks about transmitting data from the vehicle, from the mobile to the remote location.

[00:24:33] Speaker 04:
And that was what was emphasized in the claims.

[00:24:35] Speaker 04:
And I would perhaps ask your honors, they have put a definition of data stream has to be stored.

[00:24:44] Speaker 04:
If that is the correct definition, then what is the point in claim one of reciting storing the data stream?

[00:24:50] Speaker 04:
If the data stream is already stored information, then it's just redundant to simply recite storing the data stream.

[00:24:57] Speaker 04:
We propose that the construction be that the data stream does not have to be stored and that the embodiments, both the live transmission embodiment that we talk about now and also this data dump embodiment, would then both be covered by the claims.

[00:25:25] Speaker 04:
Let's also, just because Your Honors are focusing on the claim construction issue, let's talk about this just a little bit more and bring up what happened during the prosecution history.

[00:25:36] Speaker 04:
During the prosecution, the patentee amended Claim 12, which is now Claim 14, to recite that the information, the captured information is stored.

[00:25:49] Speaker 04:
That amendment did not result in allowability of the claims.

[00:25:53] Speaker 04:
In the next amendment, they removed the stored concept and replaced it with the data stream.

[00:26:00] Speaker 04:
In other words, at one point, they did amend the claims to say transmitting stored information.

[00:26:07] Speaker 04:
But then they got rid of that amendment, and now the claims do not recite that.

[00:26:13] Speaker 02:
So I would suggest... Is there any explanation in the remarks section of their office action response on why they deleted stored data and replaced it with data stream?

[00:26:21] Speaker 04:
There is not.

[00:26:22] Speaker 04:
However, if you look at the Second Amendment and the structural limitations that were put in, that's when they went from transmitting captured information and integrated captured information to clarifying that it's integrated into one data string.

[00:26:37] Speaker 04:
But there are no explanatory remarks.

[00:26:43] Speaker 04:
I also would point the court

[00:26:46] Speaker 04:
to A51, which is the 556 at column 4, lines 36 through 38.

[00:26:53] Speaker 04:
This is the paragraph that's talking about muxing the information together using the multiplexer codec and that you get the integrated information.

[00:27:01] Speaker 04:
And it says that the information is integrated into the one data stream and then stored, so also implying that

[00:27:14] Speaker 04:
A data stream exists upon integration of the information and then that data stream is later stored.

[00:27:20] Speaker 04:
That works against their proposed definition that data stream must be defined as being stored information.

[00:27:40] Speaker 01:
Anything further, Council?

[00:27:41] Speaker 04:
I don't think I do, Your Honor.

[00:27:44] Speaker 04:
I was just making sure.

[00:27:45] Speaker 04:
Thank you.

[00:27:45] Speaker 01:
Thank you.

[00:27:48] Speaker 01:
Mr. Schutzel has two and a half minutes left.

[00:27:58] Speaker 00:
Thank you, Your Honor.

[00:28:01] Speaker 00:
Judge Taranto, in reference to your question, I too have looked to see where Monroe was sighted, and in particular that section of Monroe.

[00:28:10] Speaker 00:
We did not find it

[00:28:11] Speaker 00:
in the petition for any transmission element.

[00:28:18] Speaker 00:
We did not find the teaching of Monroe relating to 231, 233, and 235 for a transmission step.

[00:28:27] Speaker 00:
We did find it for storing and integrating steps, but not for transmission.

[00:28:34] Speaker 00:
And that's why we think that we have not had a fair opportunity to address that.

[00:28:41] Speaker 00:
In terms of the waiver question, the board did reach these issues.

[00:28:51] Speaker 00:
The board did address them.

[00:28:53] Speaker 00:
And the board addressed them in a fashion that was robust.

[00:28:57] Speaker 00:
Yes, as Ms.

[00:28:59] Speaker 00:
Bailey says, the board said that no new argument, as is typical and as often happens in PKB decisions, no new argument could be raised at the oral hearing.

[00:29:09] Speaker 00:
It then went ahead and addressed each of those issues.

[00:29:13] Speaker 03:
Can I just get back to this one thing that I guess I was focused on a little bit.

[00:29:21] Speaker 03:
My recollection is that the board, at least on rehearing, maybe in the original, I'm not sure, relied in finding in Monroe transmission of the whole data stream not coming

[00:29:39] Speaker 03:
to out to the remote location, I guess, the land transceiver or wherever the aircraft radio is sending it, in reliance on a portion of Monroe that the petition does highlight at Appendix 105, namely the portion that says, where desired, selected portions of the system's data

[00:30:04] Speaker 03:
may be sent through 246.

[00:30:06] Speaker 03:
And if it's going through 246, then it's coming out of 235.

[00:30:08] Speaker 03:
246 is just the outflow, where 235 is the inflow.

[00:30:14] Speaker 00:
I don't know that I necessarily agree with that, Your Honor.

[00:30:17] Speaker 00:
I don't believe that 246.

[00:30:18] Speaker 00:
246 in Monroe is mentioned one time.

[00:30:22] Speaker 00:
It is mentioned at that one instance where you cite it.

[00:30:25] Speaker 03:
Right.

[00:30:26] Speaker 03:
But in the figure, what's coming out of the data transceiver to the aircraft

[00:30:33] Speaker 03:
aircraft radio and 235 is what's going from the whole muxing thing into the data transceiver.

[00:30:38] Speaker 03:
So you can, I think the board interpreted it that way and also interpreted, I know you disagree with this, but interpreted the selected portions to include the entirety.

[00:30:49] Speaker 00:
We do disagree and that's correct.

[00:30:51] Speaker 03:
But if that's the basis on which the board relied and if I were to disagree with you that there was nothing

[00:31:00] Speaker 03:
improper about that interpretation of Monroe, then that's a point that is actually in their petition.

[00:31:08] Speaker 03:
It's not column 22 in that box, but it is the point that is in that box.

[00:31:16] Speaker 00:
I'd have to go back and look to be certain, Your Honor.

[00:31:19] Speaker 03:
Well, they quote it.

[00:31:19] Speaker 03:
I'm not just looking at it.

[00:31:21] Speaker 03:
That's the passage that they quote in the box.

[00:31:23] Speaker 00:
Thank you.

[00:31:26] Speaker 00:
But what we then have to do is we have to read

[00:31:29] Speaker 00:
entire paragraph in which the selected portions in the Monroe language that you decided in that paragraph we have to read the entire paragraph because what it says is when you get down to the last few lines 17 to 33 17 to 33 explains that what happens there is at the cockpit monitor you send a command to the controller the controller then

[00:31:55] Speaker 00:
works back through line, if I remember correctly, 243 to influence what video you are selecting to now be sent out over 246.

[00:32:09] Speaker 00:
In other words, it may well be in their petition, and the board did cite it, but it doesn't show that all data goes out 246.

[00:32:20] Speaker 00:
At best, what it shows is that you can select video data that would go out onto 246, because the last part of that paragraph limits the disclosure or any combination, as it calls it, to what goes out on 246.

[00:32:36] Speaker 00:
And it's only video data.

[00:32:37] Speaker 00:
So for example, it's not audio, which means you're not transmitting all data.

[00:32:43] Speaker 01:
Thank you, counsel.

[00:32:45] Speaker 01:
Thank you.

[00:32:45] Speaker 01:
Casey, I'm the advisement.