[00:00:08] Speaker 02: Next case is Duncan Parking Technologies versus IPS Group 2018-1205. [00:00:14] Speaker 02: Mr. Richell. [00:00:21] Speaker 00: Good morning, Mr. Judge Lurie. [00:00:23] Speaker 00: I'm Stuart Raphael for Duncan Parking Technologies. [00:00:26] Speaker 00: Claims 1 and 9 of the 310 parking meter patent at issue here are invalid because the undisputed facts in this record show that Alex Schwartz was the inventor of the electronics that were [00:00:38] Speaker 00: relied on from the 054 patent and copied into the 310 patent. [00:00:43] Speaker 00: As this case comes to the court from the PTAB, there is no dispute that Schwartz was an inventor on the 054 patent. [00:00:50] Speaker 01: Can I ask you a question that actually relates to the next case? [00:00:56] Speaker 01: Suppose in the next case that we agreed with the district court that the 310 is not infringed. [00:01:07] Speaker 01: You have stipulated on that condition to the mootness of your invalidity counterclaim. [00:01:15] Speaker 01: If we were to affirm the 310 non-infringement judgment, why is there a case or controversy allowing you to proceed in this case where you've stipulated that you have no continuing interest in the invalidity of that pattern? [00:01:34] Speaker 00: I'm not sure of the answer to the question. [00:01:37] Speaker 00: It may turn on the extent to which standing is broader in an IPR proceeding. [00:01:46] Speaker 00: We obviously would be happy if there were a non-infringement finding with regard to the 310 patent. [00:01:53] Speaker 00: But I'm not prepared to concede that it would deprive us of standing in an IPR proceeding. [00:01:58] Speaker 01: I mean, in the other case, you didn't simply have some dismissal without prejudice. [00:02:03] Speaker 01: You actually stipulated to the mootness, which as to invalidity ordinarily, the fact that there's no infringement, it doesn't follow automatically that there's no case or controversy about invalidity. [00:02:16] Speaker 01: So when you stipulate to mootness, it seems to me you're saying you have no continuing interest in [00:02:23] Speaker 01: with respect to possible future products or anything else in whether that patent is valid or not. [00:02:29] Speaker 01: And if that's right, I don't see how you have standing to proceed. [00:02:32] Speaker 00: Judge Schreiner, with your permission, I'd like to defer that to my co-counsel to address that. [00:02:37] Speaker 01: Something to think about. [00:02:38] Speaker 00: No, it's a fair question. [00:02:41] Speaker 00: But as the case comes to this court, there's no dispute that Alex Schwartz was an inventor on the 054 patent. [00:02:47] Speaker 00: There's no dispute that if the relied upon [00:02:51] Speaker 00: electronics in the 310 patent were invented by Schwartz or co-invented by Schwartz, then the 310 patent is invalid. [00:02:59] Speaker 00: And although Dave King claims to be the sole inventor on claims 1 and 9 of the 310 patent, his admissions below conclusively established Schwartz's co-inventorship. [00:03:09] Speaker 00: And I wanted to highlight two broad categories of evidence and four individual pieces of evidence within those categories. [00:03:15] Speaker 00: We have both broad evidence of Schwartz's contribution [00:03:18] Speaker 00: and specific evidence of the particular relied upon components. [00:03:22] Speaker 00: With regard to the broad evidence, the best evidence is paragraph 45 of the King Declaration, which you'll find at page 1345 of the Joint Appendix, where King swears under oath that Alex, this is his son-in-law, Alex Schwartz, Alex's inventive contribution is limited to conception and development of how the various electrical components of the meter are interconnected and operate together. [00:03:45] Speaker 00: So King himself credits Schwartz with the conception of the electronics. [00:03:51] Speaker 01: Why is that particular issue of interpreting the language of this non-lawyer person not a factual matter for the board? [00:04:06] Speaker 00: I think with regard to what the standard review is, the standard review for inventorship is [00:04:12] Speaker 00: question of law, but the underlying facts are reviewed for substantial evidence. [00:04:18] Speaker 00: When you look at page 10 of the Joint Appendix where the PTAP issued its ruling on why it didn't think Schwartz was a co-inventor, they're not applying the correct law that looks at what was the contribution of the co-inventor, Schwartz. [00:04:31] Speaker 00: The way they pitch it at page 10 is we think King had a high-level understanding of the electronics. [00:04:38] Speaker 00: That may show that King was a co-inventor, but it doesn't show that Schwartz was not a co-inventor. [00:04:42] Speaker 00: What the evidence shows, Judge Toronto, is that Schwartz was responsible for conceiving of how the electrical components were connected together. [00:04:49] Speaker 00: Paragraph 45 clearly says that in King's affidavit. [00:04:55] Speaker 00: And I think it's significant that paragraph 45 is not mentioned by the PTAB, and it's not mentioned by IPS in their brief. [00:05:01] Speaker 00: That's a glaring omission. [00:05:03] Speaker 00: That's a very important piece of evidence. [00:05:05] Speaker 00: Schwartz agreed with the description by King in that paragraph. [00:05:08] Speaker 00: And he said in his deposition that he, Schwartz, was, quote, [00:05:12] Speaker 00: instrumental in making it all work." [00:05:14] Speaker 00: That's at page 1521. [00:05:15] Speaker 00: The specific evidence of Schwartz's contribution you'll find at page 1533 of the Joint Appendix, where Schwartz testified that he had the idea how to, quote, connect the solar panels to recharge the battery, unquote. [00:05:31] Speaker 00: And that specific connection between the solar panels operatively connected to the battery is found in claims 1D [00:05:38] Speaker 00: and 9i of the 310 patent. [00:05:41] Speaker 00: And we showed that at page 20 of our opening brief. [00:05:43] Speaker 00: And that was the basis upon which this, the primary basis upon which this IPR was instituted. [00:05:50] Speaker 00: So in other words, the specific connection in the 310 patent, you have undisputed testimony that Schwartz invented that, and King's general admission that Schwartz conceived of the electrical connections. [00:06:02] Speaker 00: IPS has a complete disconnect in its theory of the case here, right? [00:06:06] Speaker 00: Its theory of the case is, [00:06:08] Speaker 00: King was the general inventor supervising all of this. [00:06:11] Speaker 00: He had two hurdles. [00:06:12] Speaker 00: One was the mechanical one of how you get a new electric meter to fit within the housing of an existing one. [00:06:19] Speaker 00: And he relied on the D plus I inventors to help him with that. [00:06:24] Speaker 00: And he gave them credit for claims eight and 10 because of that. [00:06:28] Speaker 00: And then with regard to electronics, that was his second hurdle. [00:06:31] Speaker 00: And he said he relied on Schwartz, his son-in-law, and the head of technology to come up with a solution to that. [00:06:37] Speaker 00: And he did. [00:06:38] Speaker 00: And yet, and he admits that Schwartz gets credit for inventorship on the 054 patent, but he's absent inexplicably from the 310 patent. [00:06:48] Speaker 00: Now, I think we submitted to the court the in-ray Virhoff decision, which came out right as we were filing our reply brief, and we submitted its document 39, a notice of supplemental authority. [00:07:03] Speaker 00: And Judge Lorie's opinion for the court in that case, I think, is as close a case as you have to this one. [00:07:08] Speaker 00: That case involved a dog mobility device. [00:07:11] Speaker 00: The inventor, Virhoff, said he exercised complete dominion and control over the development of that invention. [00:07:18] Speaker 00: But it turned out that his veterinarian helped him with one critical piece of it, which was how to connect the dog's toe to the device using a figure eight loop. [00:07:27] Speaker 00: And this court held that because the inventor admitted that this other person came up with that component, that was sufficient to make that [00:07:37] Speaker 00: the veterinarian a co-inventor and invalidated the patent because the co-inventor was not listed. [00:07:44] Speaker 02: This case is a little different from the dog case. [00:07:48] Speaker 02: This relates to whether the common subject matter was the invention of another 102E. [00:07:56] Speaker 00: That's correct. [00:07:57] Speaker 00: It's a 102E case instead of a 102F case, but I think the principles are the same, and Your Honor's opinion for the court in Panu is another good example where [00:08:04] Speaker 00: this court found that the co-inventor who was left off came up with a piece of the invention. [00:08:12] Speaker 00: It doesn't have to be equal contribution, but where there's a critical piece of it that somebody else comes up with, you have to put all of the inventors on the patent or it's invalid. [00:08:22] Speaker 00: And that's a clear application of the joint inventorship, of the inventorship entity doctrine. [00:08:28] Speaker 00: So the only evidence that [00:08:29] Speaker 02: I think the other side... Is this a question of invalidity for not having the proper inventorship or the 054 patent becomes a reference against 310? [00:08:43] Speaker 00: I think the former. [00:08:45] Speaker 00: It's invalidity for not naming all of the correct inventors, which I think was the situation in PANU as well. [00:08:51] Speaker 00: And as Your Honor pointed out in both cases, they've made the argument, well, you know, we could have just amended to add the co-inventor. [00:08:57] Speaker 00: But as this court pointed out, both in Panu and in Ray Bierhoff, that's not an answer. [00:09:02] Speaker 00: If you haven't done that, the patent's invalid. [00:09:04] Speaker 00: And I think the same is true under 102E as it would be under 102F. [00:09:07] Speaker 01: I mean, I'm sorry. [00:09:09] Speaker 01: Did the board have in front of it a 102F challenge to validity? [00:09:16] Speaker 01: No, no. [00:09:17] Speaker 00: It was a 102E challenge. [00:09:19] Speaker 01: Wasn't it 102? [00:09:23] Speaker 00: It was a 102E channel. [00:09:24] Speaker 01: Right, and I thought the only question was whether the 054 was essentially prior art, that is, of another under 102E, and that in turn connects to the requirements of co-invention. [00:09:39] Speaker 00: Yes, that's correct. [00:09:40] Speaker 00: That's right. [00:09:42] Speaker 00: The only thing I think that the other side can point to is the general claim by King that he was the sole inventor, but this court made clear in the Emmerich-Hamm holdings, among others, [00:09:51] Speaker 00: a naked statement by the inventor that he invented it is not sufficient. [00:09:56] Speaker 01: What are the specific claim elements regarding electrical connection that you think Schwartz must have invented? [00:10:08] Speaker 01: And in particular, why would one not read all the claim elements here saying, well, you have to have an electrical connection. [00:10:15] Speaker 01: You have to have an electrical connection for there to be information transfer. [00:10:20] Speaker 01: But nothing in the claim claims how. [00:10:23] Speaker 01: And at most, Schwartz figured out how. [00:10:27] Speaker 01: But the idea that there had to be all the connections is all that's claimed. [00:10:34] Speaker 00: Well, I think three answers to that. [00:10:36] Speaker 00: One is I don't think they've ever argued that. [00:10:39] Speaker 00: Second, I mentioned earlier the specific idea that Schwartz came up with at page 1533 of the appendix where he said he came up with the idea of how to connect the solar panel to recharge the battery through the power management facility. [00:10:53] Speaker 00: And that connection is specifically shown in figure 8 of the 054 patent and then specifically referenced in claims 1D and 9I of the 310 patent. [00:11:05] Speaker 00: And so I think that one piece of evidence alone [00:11:09] Speaker 00: is sufficient to defeat this, to show that the patent's invalid for their failure to name Schwartz. [00:11:17] Speaker 00: So for these reasons, we think that the court should reverse the PTAB and invalidate claims 1 through 5 and 7 through 10 of the patent. [00:11:25] Speaker 00: We do have our fallback position that if the court were to remand this case, we should be entitled to obtain the use of the 71 documents that [00:11:35] Speaker 00: IPS refused to release from the protective order. [00:11:37] Speaker 00: We think that the PTAB earned in its legal analysis of factor three of the Garmin test. [00:11:43] Speaker 00: But at this point, I'd like to reserve the balance of my time. [00:11:46] Speaker 02: I'm Mr. Roehl. [00:11:48] Speaker 02: Mr. Torzon. [00:11:50] Speaker 03: Thank you, Your Honor. [00:11:51] Speaker 03: May it please the court. [00:11:53] Speaker 03: Duncan has put forward two positions, one in mentorship, and they actually basically reserved the discovery. [00:12:00] Speaker 03: So unless you have questions about the discovery issue, I probably won't get to it. [00:12:05] Speaker 03: On the inventorship issue, their theory of the case requires you to believe that IPS misled the examiner in naming the inventors on the 310 patent. [00:12:18] Speaker 03: And then rather than simply correcting it, they doubled down and misled the board to avoid correcting the misidentification of the inventors. [00:12:28] Speaker 04: It seems to me that the record here shows pretty clearly that the electronics [00:12:34] Speaker 04: were a significant part of the invention with respect to the 054. [00:12:40] Speaker 04: Yes, Your Honor. [00:12:41] Speaker 04: And that King recognized that that was a big hurdle, and that he looked to Alex Schwartz to figure out how to implement that part of the invention. [00:12:59] Speaker 04: So that's why [00:13:02] Speaker 04: Schwartz is an inventor of the 054, right? [00:13:06] Speaker 04: Correct, your honor. [00:13:08] Speaker 04: So then it seems as though the 310 in the claims describes the same electronics connection as the 054, so why isn't Schwartz also an inventor of the 310? [00:13:26] Speaker 03: Okay, so the starting point for any inventorship analysis is always claims themselves. [00:13:32] Speaker 03: And if you look at the 310 claims, it only describes a small subset of components, which Dave King had in mind well before he launched into the actual development program. [00:13:45] Speaker 03: And all it says for those components is that they have to be connected. [00:13:49] Speaker 03: Well, look at those components. [00:13:50] Speaker 03: It's a card reader, it's a coin validator that are connected to [00:13:54] Speaker 03: basically a logical system that makes sure that the information it's receiving is appropriate. [00:14:00] Speaker 03: It's a solar panel that's connected to a battery to charge the battery. [00:14:05] Speaker 03: It's a battery that's providing power to the whole system. [00:14:08] Speaker 03: That is a very, very high level discussion. [00:14:12] Speaker 03: So for instance, they're trying to read in from the 054 things like a power management system. [00:14:18] Speaker 03: A power management system in the context of a standalone [00:14:22] Speaker 03: battery run device that's being charged by a solar cell is a great thing to have. [00:14:29] Speaker 03: But it's not required by the 310 claims. [00:14:31] Speaker 03: You could have a parking meter that just is running off a battery and if it runs to power. [00:14:38] Speaker 04: Yeah, but the description in the 310 claims, look at claim one, is pretty detailed about what the electric connection has to be. [00:14:50] Speaker 04: It doesn't seem to be [00:14:52] Speaker 04: a sort of a high-level concept that King might have invented in connection with the 054. [00:15:03] Speaker 04: It seems like a pretty detailed implementation, which King himself admitted that he wasn't capable of and relied on Schwartz for. [00:15:13] Speaker 03: I disagree with a couple premises of your question, Your Honor. [00:15:16] Speaker 03: The first is, if you view that as a detailed set of interconnections, [00:15:22] Speaker 03: compared to what they are citing, which is figure 8 in the 054 patent, which has far, far, far more detail, far more components, including components that are totally unnecessary to the 310 claim. [00:15:35] Speaker 03: So what they're asking you to do is actually commit sort of a double error. [00:15:39] Speaker 03: They not only want you to read disclosure into the claim that's not in the claim, they want you to read disclosure from a different patent into the claims. [00:15:48] Speaker 03: Well, that produces a circular result. [00:15:51] Speaker 03: If you read [00:15:52] Speaker 03: requirements from the 054 patent into the 310 claims. [00:15:58] Speaker 03: Well, yes, at some point, you're going to be pulling out short stuff in. [00:16:02] Speaker 03: The question is, is that a necessary reading? [00:16:05] Speaker 03: They've never given that as a basis for a necessary reading. [00:16:09] Speaker 04: You also suggested that... Where does the record show that King alone invented [00:16:19] Speaker 04: that portion of the 310 patent claim one that refers to electronic device electrically connected. [00:16:28] Speaker 04: I mean it seemed to say that he only had the idea that there would be a connection and that the details of the connection which are also set forth in the 310 claims were Schwartz's. [00:16:43] Speaker 03: Again, let me point out the two answers to your question. [00:16:47] Speaker 03: The first is ask for Dave King himself. [00:16:50] Speaker 03: Remember, he himself is an electrical engineer. [00:16:53] Speaker 03: He has had decades of experience in the cell phone industry, decades of experience in the parking industry. [00:17:02] Speaker 03: For him to not know that you need to connect a solar cell to a battery to recharge it, [00:17:11] Speaker 03: just as facially absurd. [00:17:13] Speaker 03: The board did not buy that argument. [00:17:16] Speaker 03: The second point is, of course, all the witnesses agreed to that. [00:17:21] Speaker 01: The power coming out of the solar cell can't just sit there. [00:17:24] Speaker 01: It's got to go somewhere. [00:17:25] Speaker 03: Exactly, Your Honor. [00:17:26] Speaker 03: Exactly, Your Honor. [00:17:27] Speaker 03: And that would be sufficient for the system to work. [00:17:29] Speaker 03: So 310 would work for that. [00:17:32] Speaker 03: In the 054, you get a further improvement. [00:17:34] Speaker 03: There's power management, which makes sure that things aren't draining the system too quickly. [00:17:39] Speaker 03: And so you get a longer life out of that. [00:17:41] Speaker 03: You get advantages if it's overcast or shadows or shade or something. [00:17:46] Speaker 03: So there's no question that Alan Schwartz made a significant contribution in the 054. [00:17:52] Speaker 01: And I think you said before that in your narrative about a double error, you said something about there are aspects of figure eight of the 054 that don't appear in the 310 and that one could understand the testimony that Schwartz invented [00:18:10] Speaker 01: kind of the entire, or co-invented the entirety of Figure 8, what aspects appear in Figure 8 that don't appear in the claims of 310? [00:18:19] Speaker 03: Okay, so the best illustration of this comes from their opening brief, if you turn to pages 19 and 20. [00:18:25] Speaker 03: They highlight the components that they think are involved, right? [00:18:30] Speaker 03: We, incidentally, don't agree with that. [00:18:32] Speaker 03: We think that overstates it, but they've highlighted it. [00:18:34] Speaker 03: You'll see that it's a minority of the components in the figure. [00:18:38] Speaker 03: They repeatedly point to testimony. [00:18:41] Speaker 01: The six boxes that they've shown yellow and there are 15 other boxes. [00:18:45] Speaker 03: They repeatedly point out in their testimony that when talking about the 054, that Schwartz and King agreed that Schwartz came up with the how to connect. [00:18:59] Speaker 03: The fact that they had to be connected was King's idea from the beginning. [00:19:05] Speaker 04: But the 310 claim isn't just the idea of being connected. [00:19:11] Speaker 04: It says, connected to the reader so as to receive information electronically. [00:19:17] Speaker 04: So it talks about not just the idea of a connection. [00:19:21] Speaker 04: It has a connection that performs specific functions. [00:19:25] Speaker 03: Again, two answers to this. [00:19:27] Speaker 03: First of all, nobody's argued that this is an unpredictable art, such that an electrical engineer with years of experience wouldn't know that [00:19:35] Speaker 03: Data has to go from the readers to the controller where the power has to go. [00:19:40] Speaker 04: King says there was a big hurdle in figuring out how to do the connections. [00:19:44] Speaker 03: He's talking about that in the context of the 054, which has additional features such as a power management facility, which makes it a far better system. [00:19:54] Speaker 03: But the other thing that I think is significant here is they've hung their entire argument on the, on figure eight. [00:20:03] Speaker 03: And as their own, I believe it's on page 17 of their opening brief, they show figure 8 is actually based on a schematic from Alex Schwartz. [00:20:12] Speaker 03: And if you look at the schematic, they cite it to Appendix 1390. [00:20:18] Speaker 03: It shows that that schematic was created July 25th, I believe, 2005. [00:20:23] Speaker 03: If you actually go and look at the work being done by the mechanical design team, [00:20:31] Speaker 03: If you look at appendix 1213 through 1216, you find that the Australians have pointed out a problem. [00:20:42] Speaker 03: Alex King agrees to the solution, picking configuration nine. [00:20:48] Speaker 03: All of this discussion is happening in March and April of that year, so months before Alex actually came up with the schematic. [00:20:58] Speaker 03: And at that point, [00:21:00] Speaker 03: email from Dave Jones to Dave King says, we're waiting for the PCBs, the printed circuit boards. [00:21:08] Speaker 03: So at the point, so March and April of 2005, they've already settled on the designs and even the improvements reflected in claims 8 and 10 of the 310 patent. [00:21:22] Speaker 03: They're still waiting for the printed circuit boards from Alex [00:21:27] Speaker 03: at that point and their own evidence. [00:21:30] Speaker 03: The thing they're pointing to doesn't come along until July. [00:21:34] Speaker 03: So just as a matter, it doesn't make sense as a matter of logic, your honor. [00:21:39] Speaker 03: If you think about it, why is Dave King charging ahead with a development project on the mechanical side when he has no idea if the electronics are going to work? [00:21:49] Speaker 03: He knows the electronics are going to work. [00:21:50] Speaker 03: Everybody knows they're going to work. [00:21:52] Speaker 03: Alex's job was to make them work better. [00:21:55] Speaker 03: But that better isn't reflected in the 310 claims unless you read elements that are nowhere claimed in those claims from one patent into the claims of another. [00:22:05] Speaker 03: And that's just not the way claim construction is done. [00:22:14] Speaker 03: If you have questions about discovery, I'd be happy to address them. [00:22:19] Speaker 03: Or if there are any other questions from the panel? [00:22:22] Speaker 02: Apparently not. [00:22:23] Speaker 03: Well, I'm happy to see the balance of my time, Your Honor. [00:22:29] Speaker 02: Mr. Eichel? [00:22:36] Speaker 00: Thank you, Your Honor. [00:22:37] Speaker 00: I don't think that IPS gave it an adequate answer to Judge Dyke's question about why isn't Schwartz a co-inventor with regard to the electronics. [00:22:48] Speaker 00: I really don't think you got an answer to that. [00:22:49] Speaker 00: I think it is plain from the specific testimony that Schwartz [00:22:53] Speaker 00: not only did all of the electronics, but he did specifically, he came up with the idea of how to connect the solar panel through the power management facility to the rechargeable battery. [00:23:03] Speaker 00: That was his conception. [00:23:04] Speaker 01: I'm sorry, just on that, can you just show me where in the 310 claims there's reference to the power management facility so I can follow that? [00:23:13] Speaker 00: Yes, Your Honor. [00:23:22] Speaker 00: Appendix page 137, column 3, line 57, which we've labeled as the claim 1D, a solar cell operatively associated with said connections to charge said battery. [00:23:37] Speaker 00: So it's the operatively connected that references the power management facility through which it goes. [00:23:43] Speaker 01: Is there a claim construction that requires a power management facility through that language? [00:23:51] Speaker 00: I don't believe that the PTAB construed that language, but the testimony was that you needed that to make it work. [00:23:59] Speaker 00: You can't just connect a solar cell to the battery. [00:24:01] Speaker 00: You've got to have a way to modulate it in between. [00:24:04] Speaker 00: And then the other one is 9I, which is column 4, line 64, a solar cell operatively coupled with the rechargeable battery to charge the rechargeable battery, the solar cell being disposed to receive light via the second window. [00:24:19] Speaker 00: And so what I've pointed out is the general testimony that Schwartz and King and Mises conceived of all of the electronic connections to make it work. [00:24:30] Speaker 00: And then specifically, Schwartz said in his deposition, I came up with that idea of how to get the solar cell to work with the rechargeable battery. [00:24:38] Speaker 00: That was his idea, his conception. [00:24:40] Speaker 00: So I really think the case is very much like in Ray Virhoff where you had one, the claim, the inventory claimed to be the sole inventor. [00:24:48] Speaker 00: did much of the work, if not most of the work, but you had a critical component, in that case the figure-eight loop to connect the dog's toe to the canine mobility device, and here are the electronics. [00:25:01] Speaker 00: And without Schwartz, it wouldn't have worked. [00:25:03] Speaker 00: And so we're not saying that King didn't have some high-level idea, but Schwartz plainly had the specific contribution of how to make the electronics work. [00:25:12] Speaker 00: And I think where the PTAB bird was in looking at King's [00:25:17] Speaker 00: contribution whether he had some high-level understanding instead of looking applying the test from cases like PANU and in Ray Virhoff which looked at the co-inventors contribution whether that was significant enough to warrant co-inventor status and because of that error this court should reverse the PTAB and hold that claims one through five and seven through ten are invalid. [00:25:39] Speaker 00: Thank you. [00:25:40] Speaker 02: Thank you counsel. [00:25:41] Speaker 02: We'll take the case under advisement.