[00:00:00] Speaker 01:
Our next case is Smart Mobile Technologies versus Apple and Samsung, 2024-1289.

[00:00:07] Speaker 01:
Mr. Shaw, we're ready when you are.

[00:00:14] Speaker 02:
Good morning, Your Honors.

[00:00:15] Speaker 02:
Greer Shaw on behalf of Smart Mobile Technologies, LLC, which is the patent owner in the IPR proceeding that is underlying this case.

[00:00:29] Speaker 02:
Let me start by asking the panel whether there are any specific questions you'd like me to address.

[00:00:35] Speaker 01:
Well, why don't you proceed, and if we have any as we progress, we won't be bashful.

[00:00:42] Speaker 02:
Very good, Your Honor.

[00:00:42] Speaker 02:
Thank you.

[00:00:44] Speaker 02:
So Your Honors, I'm sure you're familiar with the briefing.

[00:00:46] Speaker 02:
The claim at issue here is claim two of what's referred to as the 168 patent in the briefs.

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The claim two generally is directed to a remote server.

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which is a claim term, remote server, that is remote relative to one or more wireless devices having various features and functionalities recited in claim two.

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The claim recites, among other things, that the remote server stores, quote, profiles of user-specific information, close book.

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So the two limitations that are at issue here are remote server and profiles of user-specific information.

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Now there are two issues here on appeal.

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First, whether the board violated the APA when it determined that the Prior Art teaches a remote server.

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And secondly, whether the board violated the APA when it determined that the Prior Art teaches profiles of user-specific information.

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Let me start with remote server.

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So Apple's theory of unpatentability with respect to remote server is articulated in their petition and consistently throughout their briefing

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was that claim to is obvious over a combination of two references, Baker and Satan.

[00:01:52] Speaker 01:
You don't mean is obvious.

[00:01:53] Speaker 01:
You mean was obvious or would have been obvious at the time of the invention.

[00:01:58] Speaker 02:
Thank you, Your Honor.

[00:01:59] Speaker 02:
Yes.

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Would have been obvious over the combination of Baker and Satan.

[00:02:03] Speaker 02:
Now, generally speaking, Baker taught a server which communicated with other devices on a local area network, including a wireless smartphone, what Baker referred to as a smartphone.

[00:02:17] Speaker 02:
Now, St.

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In taught a different type of wireless device.

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So Apple's theory posited a system comprising Baker's server and St.

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In's wireless device connected to one another on a local network.

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And this is at appendix 231.

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And you can also refer to appendix 229 to 230, which is where Apple articulates this theory.

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In fact, not only articulates it, but presents it graphically with an annotated version of figure three from Baker.

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with some additions added in red color, which shows Sainten's device together with Baker's server together on a local network.

[00:02:56] Speaker 04:
I thought the combination was not so much using Sainten's phone in Baker's network, but it was using Baker's lookup service as a server that would be installed on the carrier side of Sainten's system.

[00:03:18] Speaker 02:
Well, Your Honor, there was some reference to a carrier in the petition.

[00:03:24] Speaker 02:
That ended up not being the theory that the PTAB adopted.

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There's a footnote where they acknowledge that this was perhaps an additional theory, but the board did not get to it.

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The board did not base its decision on any server at the carrier side.

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Now, this.

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raises a claim construction issue because Apple argued that Baker's server was removed from St.

[00:03:52] Speaker 03:
James.

[00:03:52] Speaker 03:
Isn't one of your arguments that there's been an APA violation because you did not have the opportunity to address one of the prior arch Baker?

[00:04:03] Speaker 02:
That's right, your honor.

[00:04:05] Speaker 03:
Really, that's the crux of your argument.

[00:04:07] Speaker 02:
The APA violation in our view is that the patent office, the board in this case, came up with its own theory, its own argument.

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for why this limitation was started.

[00:04:16] Speaker 03:
And then you didn't get a chance to address that.

[00:04:18] Speaker 02:
Precisely right.

[00:04:20] Speaker 03:
And what I mean by that is... What about your citations to Baker at 836 through 38?

[00:04:25] Speaker 03:
It seems to me there's at least four times there that you addressed Baker.

[00:04:31] Speaker 02:
I'm sorry, Baker column 836 to 38 to 40?

[00:04:34] Speaker 03:
Right.

[00:04:36] Speaker 02:
Right.

[00:04:36] Speaker 02:
So that was the teaching from Baker that the board relied upon for the board conclusion that Baker teaches a server that can be remote to

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clients outside the local network, for example, on the internet.

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That was not Apple's theory.

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In fact, that's exactly the problem here.

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The board came up with that theory on its own.

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If you look at the petition in the additional briefing that Apple filed and the record at trial, Apple never cited those teachings from Baker.

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Apple never cited column 8, lines 36 through 40, in support of their theory that Baker, combined with St.

[00:05:09] Speaker 02:
John, taught a remote server.

[00:05:11] Speaker 04:
That was a theory that the board came up with.

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You have an unusual circumstance here,

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The board ultimately relied on Lookup Service 136 from Baker.

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And that's the precise element that was cited and relied upon in the petition.

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And so there was a debate through the entire IPR proceeding about whether Lookup Service 136 from Baker can meet this limitation of a remote server.

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And the board ultimately found that it did.

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So I don't know of another case where there was an APA violation where the board ultimately relied on the very structural element from the very prior art reference that was presented during the original petition.

[00:06:02] Speaker 02:
The issue here, Your Honor, first of all, there were two issues with respect to Baker.

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One was whether the lookup service was even a server.

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And that's something we had briefed, the smart mobile brief, earlier in the proceeding.

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And the board disagreed and considered Baker's lookup service to be a server.

[00:06:17] Speaker 04:
I guess, do you understand the concern that's embedded in my question slash observation?

[00:06:24] Speaker 02:
I understand Your Honor's concern.

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But our concern is that the board developed its own argument.

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Apple never pointed to Baker's teachings about,

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clients outside the local network on the internet as supporting Apple's argument that Baker tied a remote server.

[00:06:39] Speaker 02:
Apple never argued that.

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That was something the board came up with on its own for the first time in the final written decision.

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It did not come up in the initial institution decision.

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It did not come up at trial.

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We saw it for the first time in the FWB.

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Suddenly, this is the first time the board or anyone is pointing to Baker's teachings at column 8, line 36 to 40,

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and saying that teaches a remote server remote relative to clients on the internet.

[00:07:04] Speaker 02:
Apple never made that argument.

[00:07:06] Speaker 04:
I didn't see anywhere in your briefing, at least to us, why that's a wrong way to look up service 136.

[00:07:16] Speaker 02:
The issue, Your Honor, respectfully, is not whether that's a wrong way to look at it.

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The issue is, is it permissible for the board to come up with its own arguments that neither party ever prevented?

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And you look at, for example, the Bagnamoyal Tools case and others, and they're clear that it is a reversible error for the board to adopt arguments that a petitioner never made, particularly when, as here, the opposing party had no opportunity to respond.

[00:07:43] Speaker 02:
So whether Baker actually teaches a remote server really is not the issue.

[00:07:48] Speaker 02:
The issue is procedural.

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Did the board make an error?

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Did the board violate the Administrative Procedure Act by coming up with its own argument

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that Apple never made and finding our patent to be or claim to be unpackable based on that argument that surfaced for the first time in the final written decision.

[00:08:06] Speaker 02:
That's the error.

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Now, as I said, remote was a disputed term.

[00:08:13] Speaker 02:
Apple's theory in the petition and articulated in its briefing was that remote just means separate, right?

[00:08:19] Speaker 02:
The theory was Baker's server and Satan's device together on a local network.

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One is remote relative to the other because they're just separate devices.

[00:08:26] Speaker 02:
That was the theory, an implied construction of remote just being separate, physically separate.

[00:08:32] Speaker 02:
Smart Mobile's response, as articulated in our briefing consistently, was that remote means at a remote location.

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And there's copious argumentation in the record.

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I understand claim construction is not one of the issues before your honors.

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But what I'm saying is that parties did dispute remote.

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They offered competing.

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of facts and arguments and expert declarations about what remote means.

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And in the final written decision, the board recognized that party's claim construction dispute.

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This is at appendix 9, as well as appendix 24 to 25.

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The board especially recognized that this was a highly disputed issue.

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However, the board did not resolve that dispute.

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There's no claim construction in the FWD.

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There was no claim construction for Smart Mobile to appeal.

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There's no claim construction in the FWD on which the court can affirm the board's holding here.

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So rather than construing the disputed term remote, the board improvised its own unpatentability theory, presuming to which claim two is unpatentable under Smart Mobile's proposed construction.

[00:09:40] Speaker 02:
And what the board said was Baker teaches a declaimed remote server because it teaches a server that can serve, quote, clients outside the local network, close quote.

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such as on the internet.

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And as you want to point out for that finding, the board pointed specifically, and in fact, only to, the entire basis for that conclusion was Baker column 8, line 36 to 40, which disclosures Apple never relied upon in their petition.

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Now, I don't want to leave the court with the misimpression that that disclosure was never mentioned in the petition.

[00:10:13] Speaker 02:
It was in the background section, where Apple discussed this as the priority.

[00:10:17] Speaker 02:
They discussed Baker and St.

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Tim and some other references.

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And they do highlight, not highlight, but among other references, they point out these disclosures from Baker.

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But that's in the background section.

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When it comes to the specific arguments directed to this claim limitation, Apple was silent.

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Apple did not mention Baker column 8, line 36 to 38.

[00:10:37] Speaker 04:
You raised it in your patent owner response and your patent owner cert reply, right?

[00:10:44] Speaker 02:
Well, first of all, we were responding to the arguments that Apple made.

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We did not raise this to point out that Baker teaches the remote server.

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In fact, the opposite.

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Our argument was addressing the fact that Apple's theory was presenting Baker's server and Satan's device together on a local network.

[00:11:03] Speaker 02:
And Baker's quite clear that figure three, which is what Apple relied upon for its petition, displays devices together on a local network.

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And we referenced line 36 to 38 from Baker.

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in connection with our argument, to reinforce that Apple's theory was presenting these devices together on a local network, which was not remote, right?

[00:11:26] Speaker 02:
Because we were saying remote was... You're into your bottle time.

[00:11:31] Speaker 01:
You can continue or save it as you wish.

[00:11:36] Speaker 01:
For a combination thereof.

[00:11:38] Speaker 02:
Yes.

[00:11:46] Speaker 02:
I do want to spend a few minutes on the profiles question.

[00:11:50] Speaker 02:
The issue there was user.

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Does user mean a human person, which was Smart Mobile's argument, or does user mean or can it include software running on a device?

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And for this, Apple pointed to Baker, which talks about storing information about a requester module.

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So a device requests some kind of a software component from the server.

[00:12:13] Speaker 02:
And the server keeps track of the requester module, right?

[00:12:16] Speaker 02:
The module that requests that software.

[00:12:18] Speaker 04:
The requester module is part of the phone, right?

[00:12:21] Speaker 02:
It's software.

[00:12:22] Speaker 02:
Baker expressly defines module as an executable software component.

[00:12:26] Speaker 04:
Yeah, in a phone.

[00:12:28] Speaker 02:
Or a device, right?

[00:12:29] Speaker 02:
Some kind of device, a client device.

[00:12:30] Speaker 04:
The wireless device that's communicating with the server.

[00:12:33] Speaker 02:
A client device that's making a request, right?

[00:12:36] Speaker 04:
So it's the client device that's making a request for some kind of service.

[00:12:41] Speaker 04:
Right.

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And then the server sees that and then signs up.

[00:12:46] Speaker 02:
The server keeps track of the piece of software, the request or module, in the words of Baker, that requests that software.

[00:12:56] Speaker 03:
Does it matter to the obvious analysis whether your construction is used or not?

[00:13:03] Speaker 02:
With respect to profiles of user-specific information, Your Honor, yes, it does.

[00:13:07] Speaker 02:
Because Baker does not teach storing information about human users.

[00:13:12] Speaker 02:
And under our construction, Smart Mobile's construction, user, the claimed term user, means a human person, not a device, not software on a device.

[00:13:21] Speaker 02:
Baker does not teach storing anything about human users.

[00:13:24] Speaker 04:
The board decision points to Stanton for teaching that, right?

[00:13:28] Speaker 02:
It does not.

[00:13:29] Speaker 04:
Maybe at the bottom at 834 or something like this?

[00:13:32] Speaker 02:
Well, Stanton teaches storing, according to the petition, storing some human user-specific information

[00:13:40] Speaker 02:
Not at the server, but in the device itself.

[00:13:42] Speaker 02:
And there was some argumentation about that.

[00:13:45] Speaker 02:
The board ended up not relying upon that particular argument.

[00:13:48] Speaker 02:
I think we have a footnote in our brief addressing that point.

[00:13:52] Speaker 02:
I see that I'm running out of time.

[00:13:54] Speaker 02:
I'll reserve the rest for rebuttal unless you have any additional questions.

[00:14:00] Speaker 01:
All right, Ms.

[00:14:01] Speaker 01:
Pecomas.

[00:14:08] Speaker 00:
Good morning.

[00:14:08] Speaker 00:
May it please the court?

[00:14:10] Speaker 00:
Debbie McComas on behalf of Apple.

[00:14:13] Speaker 00:
As we know, there are two issues here.

[00:14:15] Speaker 00:
One is with respect to remote server.

[00:14:17] Speaker 00:
The other is with respect to profile user.

[00:14:19] Speaker 00:
I'll hit each of those very quickly.

[00:14:21] Speaker 00:
The court seemed to understand the issues in this case in the party's briefing.

[00:14:26] Speaker 00:
But Judge Chen, you got it right.

[00:14:28] Speaker 00:
It's almost like ships passing in the night as to what was argued below and what the issues are here.

[00:14:34] Speaker 00:
But the combination that Apple argued was always Santon's teaching of a mobile device that sent messages over the air to a carrier.

[00:14:45] Speaker 00:
And the use of Baker was to show the remote server could be implemented in the combination with Santon.

[00:14:55] Speaker 00:
So it's the reverse of what my opponent understood in the briefing it to be.

[00:15:01] Speaker 00:
And that helps explain a little bit the disconnect in the briefing, I think, as to what the issues are here.

[00:15:07] Speaker 00:
And also, the disconnect or the assertion of an APA violation here with respect to the board's findings, which are very specific.

[00:15:16] Speaker 00:
And there's one other thing my opponent noted that I think is helpful here, that they conceded that claim construction is not before the court.

[00:15:25] Speaker 00:
And admittedly, that was a struggle in the briefing because

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You wanted to just say, no, no, claim construction was right.

[00:15:30] Speaker 00:
But there was absolutely no engagement in the opening brief on claim construction.

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And the problem for my opponent is he has to show harmless error for the court to even spend its time analyzing the APA violation.

[00:15:44] Speaker 00:
And there's no harmless error absent a showing that the claim construction is harmful error.

[00:15:52] Speaker 00:
Correct.

[00:15:53] Speaker 00:
I'm also talking backwards.

[00:15:57] Speaker 00:
Exactly.

[00:15:58] Speaker 00:
If the court has no further questions on remote server, I'll address profile user quickly.

[00:16:06] Speaker 00:
And with respect to the profile of user-specific information, it's important to note the claim term is profile of user-specific information, not user.

[00:16:19] Speaker 00:
And that's important.

[00:16:21] Speaker 00:
And it's also important to note that what the board found here was a very fact-intensive analysis with respect to the teachings, as Your Honor pointed out, Judge Chen, that Saint On on its own taught the type of user that Smart Mobile advocates for, what Baker taught us, and the combination of those, along with the extensive testimony of what one skilled in the art would understand.

[00:16:48] Speaker 00:
was that a user would necessarily, that the profiles of user-specific information would be synonymous with what the combination of Baker and Santon taught.

[00:17:00] Speaker 00:
This was entirely a fact-specific finding by the board that has not been challenged for substantial evidence on appeal.

[00:17:07] Speaker 00:
If the court has no further questions, I'll yield my time.

[00:17:13] Speaker 01:
No one loses points by not using up all their time.

[00:17:16] Speaker 00:
Thank you, Ron.

[00:17:23] Speaker 02:
Thank you, Your Honors.

[00:17:24] Speaker 02:
Just briefly to respond to two points.

[00:17:29] Speaker 02:
First, with respect to remote server, the board did not rely upon any server in St.

[00:17:36] Speaker 02:
John.

[00:17:36] Speaker 02:
That's quite clear from the final written decision.

[00:17:40] Speaker 02:
The board, and I'm just reading.

[00:17:42] Speaker 02:
This is Appendix 26.

[00:17:45] Speaker 02:
This is the board saying Baker teaches the claim to remote server because it teaches the server

[00:17:52] Speaker 02:
Lookup Service 136 that can serve clients outside the local network, thus meeting Smart Mobile's interpretation of remote server that excludes a local network server on the app, network server for the outside local network clients.

[00:18:06] Speaker 02:
For that finding, the board relied upon Baker 8, lines 36 to 40.

[00:18:12] Speaker 02:
The board did not rely upon St.

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Jane or anything at the carrier side in St.

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Jane at all, and it's not enough for

[00:18:21] Speaker 02:
Apple to fish around in the record and say, well, Satan taught some kind of a carrier-side server, when that's not the theory the board relied upon.

[00:18:28] Speaker 02:
The court here is limited to reviewing the theories that the board actually relied upon, did not rely upon Satan.

[00:18:34] Speaker 02:
With respect to the user, similarly, the board found, and this is an appendix 36,

[00:18:45] Speaker 02:
We agree that one of Ordinary Skill and Yard would have recognized that the server registering the requester module as a user of the service object means that the server is maintaining a profile for the user of the service object, parentheses, the requester module, close parentheses, close quote.

[00:19:03] Speaker 02:
Again, the board relied upon Baker exclusively.

[00:19:07] Speaker 02:
Clearly the board adopted Apple's construction that the word server can include software,

[00:19:14] Speaker 02:
That was directly contrary to Smart Mobile's proposed construction.

[00:19:17] Speaker 02:
The board never resolved that claim construction dispute.

[00:19:20] Speaker 01:
Counsel, as you can see, your time has expired.

[00:19:23] Speaker 01:
Do you have a final thought?

[00:19:26] Speaker 02:
That's it, Your Honor.

[00:19:27] Speaker 02:
Thank you very much.

[00:19:28] Speaker 01:
All right.

[00:19:28] Speaker 01:
Thank you.

[00:19:29] Speaker 01:
Both counsel, the case is submitted.