Hovsepian v. Apple, Inc.

Filing 59

Reply Memorandum re 55 MOTION to Strike Defendant Apple, Inc.'s Notice of Motion and Motion to Strike Class Allegations from Plaintiff's Second Amended Complaint Defendant Apple Inc.'s Reply Brief In Support of Motion to Strike Class Allegations from Plaintiff's Second Amended Complaint filed byApple, Inc.. (Counts, Thomas) (Filed on 11/20/2009)

Hovsepian v. Apple, Inc.

Doc. 59

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HENNIGAN, BENNETT & DORMAN LLP RODERICK G. DORMAN (SBN 96908) ALAN P. BLOCK (SBN 143783) KEVIN SHENKMAN (SBN 223315) 601 South Figueroa Street, Suite 3300 Los Angeles, California 90017 Phone: [phone] Fax: [phone] [e-mail] [e-mail] [e-mail] Attorneys for Plaintiff ACACIA MEDIA TECHNOLOGIES CORPORATION

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA SAN JOSE DIVISION

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CASE NO. 05-CV-01114 JW ACACIA'S MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION FOR MARKMAN RECONSIDERATION

In re ACACIA MEDIA TECHNOLOGIES CORPORATION

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Case No. 05 CV 01114 JW PLAINTIFF ACACIA MEDIA TECHNOLOGIES CORPORATION'S MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF ITS MOTION FOR RECONSIDERATION AND CLARIFICATION OF THE JULY 12, 2004 MARKMAN ORDER DATE: TIME: CTRM: September 8-9, 2005 9:00 a.m. Hon. James Ware

Dockets.Justia.com

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TABLE OF CONTENTS (Page) I. II. INTRODUCTION....................................................................................................... 1 THE COURT SHOULD MODIFY ITS MARKMAN ORDER IN LIMITED RESPECTS.................................................................................................................. 3 A. Acacia's Grounds for Reconsideration of the Court's Analysis and Construction of the Claim Term "Transmission System"............................... 3 1. 2. Acacia's Proposed, Reconsidered Construction of the "Transmission System" ....................................................................... 3 The Court Should Consider Acacia's Contention that the Transmission System is Located in One Facility or Spread Over a Plurality of Facilities ............................................................... 3

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B.

Acacia's Grounds for Reconsideration of the Court's Analysis and Construction of the Claim Term "Transmission System at a First Location" ......................................................................................................... 5 1. 2. Acacia's Proposed, Reconsidered Construction of "Transmission at a First Location"...................................................... 5 The `702 Patent Not Only Expressly States That the Transmission System Can Be at More Than One Locations, it Sufficiently Explains How a Transmission System at More than One Location Would Operate...................................................... 5 Figures 1a, 1b, 1d, 1e, 1f, and 1g of the `702 Patent do not Illustrate a Transmission System at a Single Location........................ 7 The Term "At" Does Not Limit the Phrase "Transmission System at a First Location" to a Single Location................................ 8 The Court Should Construe the Article "A" in the Phrase "at a First Location" to Mean "One or More than One" ......................... 10 The Terms "First Location" and "Second Location" Are Repeated Instances of the Same Element.......................................... 11

3. 4. 5. 6. C.

Acacia's Grounds for Reconsideration of the Court's Analysis and Construction of the Claim Phrase "Reception System at a Second Location" ....................................................................................................... 12 1. Acacia's Proposed, Reconsidered Construction of the Phrase "Reception System at a Second Location"........................................ 12
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TABLE OF CONTENTS (cont'd) (Page) 2. The Factual and Legal Arguments Presented in Connection With Reconsideration of the Construction for "Transmission System at a First Location" Apply With Equal Force to the Reconsideration of the Construction for "Reception System at a Second Location" ........................................................................... 12

D.

Acacia's Grounds for Reconsideration of the Court's Analysis of the Claim Term "Sequence Encoder" ................................................................. 13 1. 2. 3. The Court Applied the Wrong Legal Standard In Construing "Sequence Encoder".......................................................................... 14 The Court Must Consider Expert Testimony When Determining the Meaning of "Sequence Encoder" ........................... 15 The `702 Patent Specification and its Claims Teach Persons of Ordinary Skill in the Art that the Sequence Encoder is a Time Encoder .................................................................................... 16 The Court's Finding that the "Sequence Encoder" In Claim 7 is a Time Encoder Which Transforms Digital Data Blocks Into a Group of Addressable Data Blocks Confirms that "Sequence Encoder" in Claim 1 is a "Time Encoder" ...................... 18 Acacia's Proposed, Reconsidered Construction of "Sequence Encoder" ............................................................................................ 20

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Acacia's Grounds for Clarification of the Court's Analysis of the Claim Term "Identification Encoder" ........................................................... 20 1. The Court Should Clarify Its Markman Order to State that the Specification of the `702 Patent States that the Identification Encoder Includes Software................................................................ 20 The Court Should Clarify its Markman Order to Remove the Statements that the term "Identification Encoder" is "Insolubly Ambiguous" and "Arguably Indefinite".......................... 21

2.

Acacia's Grounds for Clarification of the Court's Construction of the Claim Phrase "in Data Communication with"............................................... 22 1. Acacia's Proposed Clarified Construction of "in Data Communication With" ...................................................................... 24

CONCLUSION ......................................................................................................... 24
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TABLE OF AUTHORITIES (Page) Cases 3M Innovative Properties Co. v. Avery Dennison Corp., 350 F.3d 1365 (Fed. Cir. 2003) ...................................................................................................... 11 Abtox, Inc. v. Exitron Corp., 122 F.3d 1019 (Fed. Cir. 1997) .................................................................................................. 7, 10 AFG Indus., Inc. v. Cardinal IG Co., 239 F.3d 1239 (Fed. Cir. 2001) ...................................................................................................... 16 All Dental Prodx, LLC v. Advantage Dental Products, Inc., 309 F.3d 774 (Fed. Cir. 2002) ........................................................................................................ 14 Anchor Wall Systems, Inc. v. Rockwood Retaining Walls, Inc., 340 F.3d 1298 (Fed. Cir. 2003) ........................................................................................................ 8 Andrew Corp. v. Gabriel Elec., Inc., 847 F.2d 819 (Fed. Cir. 1988) ........................................................................................................ 12 Bancorp Serv., LLC v. Hartford Life Ins. Co., 359 F.3d 1367 (Fed. Cir. 2004) ................................................................................................ 14, 15 Ecolab, Inc. v. Paraclipse, Inc., 285 F.3d 1362 (Fed. Cir. 2002) ................................................................................................ 17, 19 Edelstein v. Frank, 52 F.3d 1035 (Fed. Cir. 1995) ........................................................................................................ 14 Electro Scientific Indus., Inc. v. Dynamic Details, Inc., 307 F.3d 1343 (Fed. Cir. 2002) .................................................................................................... 7, 8 Elkay Mfg. Co. v. Ebco Mfg. Co., 192 F.3d 973 (Fed. Cir. 1999) .................................................................................................... 7, 10 Exxon Research & Eng'g Co. v. United States, 265 F.3d 1371 (Fed. Cir. 2001) ...................................................................................................... 15 In re Gardner, 427 F.2d 786 (C.C.P.A. 1970)........................................................................................................ 21 In re Gay, 309 F.2d 769 (CCPA 1962).............................................................................................................. 6 In re Swinehart, 439 F.2d 210, 169 USPQ 226 (CCPA 1971).................................................................................. 18
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TABLE OF AUTHORITIES (cont'd) (Page) Intermatic, Inc. v. Lamson & Sessions Co., 273 F.3d 1355 (Fed. Cir. 2001) ...................................................................................................... 17 Inverness Med. Switz. Gmbh v. Princeton Biomeditech Corp., 309 F.3d 1365 (Fed. Cir., 2002) ................................................................................................. 9, 10 Key Pharms. v. Hercon Labs. Corp., 161 F.3d 709 (Fed. Cir. 1998) ........................................................................................................ 16 Liebel-Flarsheim Co. v. Medrad, Inc., 358 F.3d 898 (Fed. Cir. 2004) ........................................................................................................ 19 Miles Lab., Inc. v. Shandon, Inc., 997 F.2d 870 (Fed. Cir. 1993) ........................................................................................................ 15 Phillips v. AHW Corp., ___ F.3d ___, 2005 U.S. App. LEXIS 13954 (Fed. Cir. 2005) (en banc)............................... passim Rhine v. Casio, Inc., 183 F.3d 1342 (Fed. Cir. 1999) ...................................................................................................... 19 S3, Inc. v. nVidia Corp., 259 F.3d 1364 (Fed. Cir. 2001) ...................................................................................................... 15 SmithKline Beecham Corp. v. Apotex Corp., 403 F.3d 1331 (Fed. Cir. 2005) ...................................................................................................... 21 The Gillette Company v. Energizer Holdings, Inc., 405 F.3d 1367 (Fed. Cir. 2005) ...................................................................................... 6, 10, 11, 12 Vitronics Corp. v. Conceptronic, Inc., 90 F.3d 1576 (Fed. Cir. 1996) .......................................................................................................... 9 W.L. Gore & Associates, Inc. v. Garlock, Inc., 721 F.2d 1540 (Fed. Cir. 1983) ...................................................................................................... 15 Statutes U.S.C. § 112, ¶ 6................................................................................................................................. 22 Other Authorities (M.P.E.P., § 608.01(o), Seventh Edition, July 1998 .......................................................................... 19 M.P.E.P. § 2173.04, Seventh Edition, July 1998 ............................................................................... 22 -iv-

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TABLE OF AUTHORITIES (cont'd) (Page) M.P.E.P., § 2173.05(e), Seventh Edition, July 1998 .......................................................................... 14 M.P.E.P., § 2173.05(g), Seventh Edition, July 1998.................................................................... 17, 18

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I.

INTRODUCTION Plaintiff Acacia Media Technologies Corporation ("Acacia") hereby moves for

reconsideration and clarification of the Court's July 12, 2004 Markman Order ("Markman Order"). In this motion, Acacia seeks reconsideration of only three issues, and seeks clarification of three more. Acacia shall address the Court's analysis and construction of these terms and shall show why the Court should reconsider or clarify its constructions. Acacia seeks reconsideration of the Court's construction of "transmission system" and "transmission system at a first location" to assure that the construction for each makes clear that the location of the transmission system is not limited to a single facility; i.e., the transmission system may be spread over a plurality of facilities. This is how the patentees specially defined the transmission system in the specification, and the specification and claim language chosen by the patentees fully supports this construction. For the same legal and factual reasons, Acacia seeks reconsideration of the Court's construction of "reception system at a second location" to make clear that the location of the reception system is not limited to a single facility. For the final issue for reconsideration, Acacia seeks claim construction of the phrase, "sequence encoder." Based solely on the intrinsic patent records, the Court tentatively ruled in its Markman Order that it could not construe the claim term "sequence encoder." The term "sequence encoder" is definite and should be construed as a "time encoder," because the specification teaches one of ordinary skill in the art that a time encoder places information into a sequence of addressable data blocks. Acacia will present expert testimony at the evidentiary hearing demonstrating that persons of ordinary skill in the art in January 1991 would have understood the meaning of "sequence encoder" when the claims are read in light of the specification. Further, this construction is confirmed by the rules of claim construction most recently enunciated in the Federal Circuit's en banc decision of Phillips v. AHW Corp., ___ F.3d ___, 2005 U.S. App. LEXIS 13954 (Fed. Cir. 2005) (en banc) and by established claim construction rules, such as claim differentiation.
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The Lexis version of the opinion in the Phillips case is attached as Exhibit 4 to the Block
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Acacia seeks clarification of the Court's analysis of the construction of "identification encoder" to clarify an inconsistency in the Markman Order itself. The Court construed "identification encoder" as "a structure that assigns a unique identification code," but then made statements in the Markman Order that the "identification encoder" is "insolubly ambiguous" and "arguably indefinite." Acacia will present expert testimony at the evidentiary hearing demonstrating that persons of ordinary skill in the art in January 1991 would have understood the meaning of "identification encoder" when the claims are read in light of the specification, and the Court, based on that expert evidence and the intrinsic patent evidence, should delete from its order any statements describing the "identification encoder" as "indefinite" or "insolubly ambiguous.". Finally, Acacia seeks clarification of one sub-phrase and one term contained in the Court's construction of the phrase "in data communication with." The Court construed that phrase as "one or more devices connected such that data is being transferred between the devices in real time." The sub-phrase "one or more devices" we clearly believe was intended by the Court to read "two or more devices," and this clarifying change should be made. Based on the Court's order, we also understand that the Court selected the term "real-time" to describe the transfer of data between devices to exclude transferring data via diskette. We do not seek to disturb that intended result. We seek, however, to clarify, consistent with the express teachings of the intrinsic patent documents, that the transmission system may transmit video information in a fraction of the time it takes for a viewer to watch the video. Without this clarification, we suspect a jury will be confused and require the data to be sent from the transmission system to the receiving system at precisely the speed a viewer would watch a video, which of course is not contemplated by the specification at all. Acacia looks forward to the evidentiary hearing on September 8 and 9 and respectfully requests that the Court adopt Acacia's proposed modifications to the Markman Order.

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II.

THE COURT SHOULD MODIFY ITS MARKMAN ORDER IN LIMITED RESPECTS A. Acacia's Grounds for Reconsideration of the Court's Analysis and Construction of the Claim Term "Transmission System" 1. Acacia's Proposed, Reconsidered Construction of the "Transmission System" Acacia respectfully requests that the Court amend its proposed construction of "transmission

system" to reflect the following changes: "an assembly of elements, hardware and software, that function together to convert items of information for storage in a computer compatible form and subsequent transmission to a reception system, the transmission system being located in one or more facilities." This requested change is needed to avoid potential juror confusion. The fact that the Court's construction of "transmission system" does not specify that the transmission system may be spread over a plurality of facilities means that a defendant whose transmission system is spread over a plurality of facilities may attempt to argue that they do not infringe any of the claims of the `992 patent for this reason. The patentees clearly defined the transmission system as being located in one facility or spread over a plurality of facilities in the specification and they are entitled to a construction that includes this definition. (See, `992 patent, 5:61-63 and `702 patent, 5:58-60; Exhibits 2 and 3). 2. The Court Should Consider Acacia's Contention that the Transmission System is Located in One Facility or Spread Over a Plurality of Facilities In its Markman Order, the Court declined to include in Acacia's requested claim construction that the transmission system may be located in one facility or may be spread over a plurality of facilities when considering its construction of the term "transmission system." (Markman Order, at page 27, n 19; Exhibit 1). Instead, the Court stated that it would address Acacia's contention when considering the claim terms "at a first location" and "at a second location." (Id.) For the reasons expressed below, this issue needs to be addressed in connection with both the "transmission system" -3CASE NO. 05-CV-01114 JW

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and the "at a first location" elements of both the `992 and `702 patent claims to avoid prejudice to Acacia, and to impart clarity and consistency to the Markman Order in connection with this single issue that affects two different claim terms. The term "transmission system" is found in all of the claims of the `992 patent and in all of the claims of the `702 patent. In the `992 patent claims, unlike the `702 patent claims, the language "at a first location" is not present. There is no language in the `992 patent claims susceptible to the meaning that the transmission system must be or even might be located only at a single, particular location. Similarly, there is no language in the `992 patent claims which precludes the transmission system from being spread over a plurality of facilities or from being located in more than one location. The identical specification of the `992 and `702 patents could not be clearer in describing the transmission system as being located in one facility or spread over a plurality of facilities: "Transmission system 100 may either be located in one facility or may be spread over a plurality of facilities." (`992 patent, 5:61-63 and `702 patent, 5:58-60). The Federal Circuit emphasizes the importance of the specification in claim construction and the importance of construing a claim term consistent with a special definition given to the term by the patentee. See, Phillips v. AHW Corp., __ F.3d __, 2005 U.S. App. LEXIS 13954, *33-*34 (Fed. Cir. 2005) (en banc) ("Consistent with that general principle [that the specification informs the proper construction of the claims], our cases recognize that the specification may reveal a special definition given to a claim term by the patentee that differs from the meaning it would otherwise possess.") The patentees in this case gave the term "transmission system" an expansive geographical meaning--it could be located in a plurality of facilities. That definition needs to be given effect in our claim construction.
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See, e.g., claim 19 of the `992 patent: "A distribution method responsive to requests from a user identifying items in a transmission system containing information to be sent from the transmission system to receiving systems at remote locations . . . storing, in the transmission system, information from items. . . sending a request, by the user to the transmission system, . . . sending at least a portion of the stored information from the transmission system to the receiving system. . ." -4-

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B.

Acacia's Grounds for Reconsideration of the Court's Analysis and Construction of the Claim Term "Transmission System at a First Location" 1. Acacia's Proposed, Reconsidered Construction of "Transmission at a First Location"

Acacia respectfully requests that the Court amend its proposed construction of "transmission system at a first location" to reflect the following changes: "a transmission system at one or more particular locations separate from the location of the reception system." Again, this change is needed to conform the claim construction to the teachings of the specification. Moreover, as explained below, it is required to correct an error of law concerning the legal meaning to be accorded the word "comprising" in claim drafting, and certain mistakes of fact concerning the disclosures of the patent specification. 2. The `702 Patent Not Only Expressly States That the Transmission System Can Be at More Than One Locations, it Sufficiently Explains How a Transmission System at More than One Location Would Operate In its Markman Order, the Court, in considering whether the phrase "transmission system at a first location" is limited to one particular location, stated: "[a]s is often the case in the Yurt family of patents, the specification discloses a "high level block diagram" of the invention but does not explain the actual structural components (e.g. software or hardware) required to have a transmission system at more than one location. (`702 patent, 4:1). Thus, it is conceivable that the patentees limited the claim to not cover a transmission system in more than one location in an effort to preserve validity of the claims." (Markman Order, at page 30, n 23; Exhibit 1). These statements by the Court are not correct. With respect to the statement that the patents only disclose "high level" diagrams, the patents do disclose "detailed block diagrams" of the invention (See, `702 patent, 3:28-30: "FIGS. 2a and 2b are detailed block diagrams of preferred implementation of the transmission system of the present invention." See also, `702 patent, at 5:5618:53 and Figures 2a and 2b; Exhibit 3; emphasis added). -5-

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The Court's statement that the patent specification does not explain the structural components required to have a transmission system at more than one location is also incorrect. The specification describes how a transmission system that is spread over a plurality of facilities would operate. For instance, the specification provides examples of transmission systems having multiple source material libraries and/or multiple compressed data libraries and describes how such transmission systems would operate. (See, e.g., '702 patent, 6:19-29; '702 patent, 10:19-24; '702 patent, 11:22-30; '702 patent, 12:41-47; '702 patent, 12:59-65; '702 patent, 14:43-45; '702 patent, 15:49-52; '702 patent 17:7-18; Exhibit 3). Regardless, there is no legal requirement for the patentees to have explained every structural element necessary to operate a transmission system that is spread over a plurality of facilities ­ the patentees are only required to provide an enabling disclosure such that one of skill in the art would have been able to make and use the invention without undue experimentation. Koito Manufacturing Co., Ltd. v. Turn-Key-Tech, LLC, 381 F.3d 1142, 1155-56 (Fed. Cir. 2004), quoting, In re Gay, 309 F.2d 769, 774 (CCPA 1962) ("'Not every last detail is to be described, else patent specifications would turn into production specifications, which they were never intended to be.'"). Further, the Court's statement above that "it is conceivable" that the patentees limited the claims of the `702 patent to a single location to preserve the validity of the claims is unsupported and in fact contradicted by the intrinsic patent documents. This issue was not raised in any of the prosecution histories, and the claim language used by the patentees was clearly intended to capture transmission systems located at multiple locations, so long as none of those transmission system facilities are located at the reception system. The claiming convention used by the patentees and their prosecuting attorney demonstrate an intent to provide an expansive geographic meaning to the phrase "transmission system at a first location." The claims of the `702 patent use the open-ended transition term "comprising," meaning that the entire claim is presumptively open-ended. See, The Gillette Company v. Energizer Holdings, Inc., 405 F.3d 1367, 1372 (Fed. Cir. 2005) ("The word `comprising' transitioning from the preamble to the body signals that the entire claim is presumptively open-ended."). Open-ended means it is not limited. Therefore, the article "a" in the phrase "at a first location" should be -6-

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interpreted to mean "one or more than one." (Markman Order, at 29:23-27, citing, Elkay Mfg. Co. v. Ebco Mfg. Co., 192 F.3d 973, 977 (Fed. Cir. 1999) and Abtox, Inc. v. Exitron Corp., 122 F.3d 1019, 1023 (Fed. Cir. 1997)). Had the patentees intended to limit the transmission system to a single location, they would have used a closed transitional term, such as "consisting of," or they would have specified in the claim that they intended to limit the transmission system to a single location by stating, for instance: "a transmission system at a single first location." The patentees did not use such language in the claims. 3. Figures 1a, 1b, 1d, 1e, 1f, and 1g of the `702 Patent do not Illustrate a Transmission System at a Single Location In its Markman Order, the Court states that "Figures 1a, 1b, 1d, 1e, 1f, and 1g of the `702 patent illustrate a transmission system at a single location." (Markman Order, at 30:10-12; Exhibit 1). Based on this statement, the Court held that the specification supports construing the phrase "a transmission system at a first location" to mean a transmission system at a single location and that the specification does not rebut this construction. (Markman Order, at 30:9-14; Exhibit 1). Figures in a patent are only understood in the context of the language of the specification that refers to them. See, e.g., Electro Scientific Indus., Inc. v. Dynamic Details, Inc., 307 F.3d 1343, 1349 (Fed. Cir. 2002) ("In the context of the entire specification, the depiction of separate work pieces in Figure 6 does not limit the claim language). Stated differently, you read the text of the specification to learn what the Figures mean, not vice-versa. The Court's statement that "Figures 1a, 1b, 1d, 1e, 1f and 1g of the `702 patent illustrate a transmission system at a single location" is apparently based upon the use of a single circle or a single rectangle in each identified figure to denote the transmission system. However, it is not relevant whether, in the figures, the transmission system is denoted in one or more rectangles or circles. The legally relevant question is the following: what does the specification explain is depicted by that single circle or single rectangle in each figure? In each of Figures 1a, 1b, 1d, 1e, 1f, and 1g, the transmission system is identified by reference numeral 100. Reference numeral 100 is used throughout the specification and the other figures of the patent to identify the transmission system. The specification expressly defines the -7-

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transmission system, identified as reference numeral 100, as being located in one facility or spread over a plurality of facilities: "Transmission system 100 may either be located in one facility or may be spread over a plurality of facilities." (`702 patent, 5:58-60; Exhibit 3; emphasis added). Thus, the transmission systems shown in Figures 1a, 1b, 1d, 1e, 1f, and 1g and identified by reference numeral 100 depict transmission systems that are located in one facility or are spread over a plurality of facilities. These Figures therefore do not support limiting the phrase "transmission system at a first location" to a transmission system at a single location. Electro Scientific, 307 F.3d at 1349. Even if these Figures did depict the transmission system at a single location, which they clearly do not for the reasons we have explained, these Figures alone cannot limit the claim to a transmission system at a single location. See, Anchor Wall Systems, Inc. v. Rockwood Retaining Walls, Inc., 340 F.3d 1298, 1306-07 (Fed. Cir. 2003) ("Similarly, the mere fact that the patent drawings depict a particular embodiment of the patent does not operate to limit the claims to that specific configuration.") 4. The Term "At" Does Not Limit the Phrase "Transmission System at a First Location" to a Single Location In its Markman Order, the Court stated that the term "at" in the phrase "at a first location" is used to indicate presence or position, and thus this term limits the phrase "transmission system at a first location" to a transmission system at a single location. (Markman Order, at 30:1-9; Exhibit 1). The use of the preposition "at" in the phrase "at a first location" does not require that the "transmission system" be limited to a single location, because the preposition "at" is not used in the patent specification and in other claims in the Yurt family of patents to indicate presence or position at only a single location. Instead, the term "at" is used in the specification of the patent and in other claims to mean presence or position at multiple locations: "It is possible to process orders and operate a database of available titles at multiple locations remote of the source material library 111." (`702 patent, 14:43-45; Exhibit 3) (emphasis added).

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Further, the term "at" is used in other claims of the Yurt family of patents to indicate presence or position at more than one location. See, Phillips, __ F.3d at __, 2005 U.S. App. LEXIS 13954, at *28 ("Because claim terms are normally used consistently throughout the patent, the usage of one term in one claim can often illuminate the meaning of the same term in other claims."); Inverness Med. Switz. Gmbh v. Princeton Biomeditech Corp., 309 F.3d 1365, 1371 (Fed. Cir., 2002) ("A claim term used in multiple claims should be construed consistently"). The patentees' use of the term "at" in the specification and in other related claims should be dispositive that the term "at" does not limit the phrase "transmission system at a first location" to a transmission system at a single location. See, Phillips, __ F.3d at __, 2005 U.S. App. LEXIS at *29, quoting, Vitronics Corp. v. Conceptronic, Inc., 90 F.3d 1576, 1582 (Fed. Cir. 1996) ("As we stated in Vitronics, the specification `is always highly relevant to the claim construction analysis. Usually, it is dispositive; it is the single best guide to the meaning of a disputed term.'")
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See, Claims 19 and 47 of the `992 patent and claims 2 and 5 of U.S. Patent No. 5,253,275 (the `275 patent: Exhibit 5): "19. A distribution method responsive to requests from a user identifying items in a transmission system containing information to be sent from the transmission system to receiving systems at remote locations, the method comprising the steps of . . ." (`992 patent, Claim 19; Exhibit 2); "47. A distribution system including a transmission system and a plurality of receiving systems at remote locations, the transmission system being responsive to requests identifying items containing information to be sent from the transmission system to the receiving systems at the remote locations, the distribution system comprising: . . ." (`992 patent, Claim 47); "2. A distribution method responsive to requests from a user identifying items in a transmission system containing information to be sent from the transmission system to receiving systems at remote locations, the method comprising the steps of: . . ." (`275 patent, Claim 2); and "5. A distribution method responsive to requests from a user identifying items in a transmission system containing information to be sent from the transmission system to receiving systems at remote locations, the method comprising the steps of: . . ." (`275 patent, Claim 5).

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5.

The Court Should Construe the Article "A" in the Phrase "at a First Location" to Mean "One or More than One"

In its Markman Order, the Court correctly states that the "articles `a' or `an' may mean `one or more than one' in particular instances, especially in claims that use the transitional term `comprising.'" (Markman Order, at 29:23-27; Exhibit 1), citing, Elkay, 192 F.3d at 977 and Abtox, 122 F.3d at 1023. Although the claims of the `702 patent use the open-ended transitional term "comprising," the Court does not construe the article "a" in the phrase "at a first location" to mean "one or more than one." The Court did not explain why it did not construe "a" to mean "one or more than one." The fact that the claims of the `702 patent use the open-ended transition phrase "comprising" "signals that the entire claim is presumptively open-ended." Gillette, 405 F.3d at 1372 (emphasis added). Therefore, the Court should construe the article "a" in the phrase "at a first location" to mean "one or more than one." The fact that the term "a" follows the term "at" is irrelevant. As discussed above, the term "at" does not limit the phrase "transmission system at a first location" to a transmission system at a single location. Instead, the term "at" was used in the patent specification and in other claims to indicate presence or position at multiple locations. Thus, the phrase "at a first location" should be construed as "at one or more than one location." This construction is consistent with the definition given by the patentees in the patent specification that the transmission system may be located at one facility or spread over a plurality of facilities. (`702 patent, 5:58-60; Exhibit 3). It is also consistent with the construction of the term "transmission system," which, as discussed earlier, is construed to permit the "transmission system" to be located in one facility or spread over a plurality of facilities, and therefore conforms to the rule that a claim term used in multiple claims should be construed consistently. See, Inverness, 309 F.3d at 1371; Phillips, __ F.3d at __, 2005 U.S. App. LEXIS 13954, at *28.

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There is a typographical error in the Markman Order: ". . . articles `an' or `an' may mean . . ." Acacia proposes that the Court correct this typographical error in its reconsidered Markman Order. -10-

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6.

The Terms "First Location" and "Second Location" Are Repeated Instances of the Same Element

In its Markman Order, the Court rejected Acacia's assertion that the use of the terms "first" and "second" is a common patent law convention to distinguish between repeated instances of an element or limitation. (Markman Order, at page 30, n 21; Exhibit 1). In rejecting Acacia's assertion, the Court merely states that it "does not consider the use of the phrases `at a first location' and `at a second location' to qualify as repeated instances of an element or limitation." Recently, the Federal Circuit held that the terms "first," "second," and "third," (referring to razor blades) used in a claim having the open-ended transition phrase "comprising" could not be construed as limiting the claim to three blades. Gillette, 405 F.3d at 1373. In Gillette, the court held that the fact that the claim "does not follow a consecutive order (i.e., it does not discuss the second blade after the first)" means that "the claim is thus clearly not using the ordinals-first, second, and third-to show a consecutive numerical limit but only to distinguish or identify the various members of the group." Gillette, 405 F.3d at 1373. The same is true in this case. The claims of the `702 patent do not follow a consecutive order; it is irrelevant whether the transmission system is at the "first location" or the "second location" and likewise whether the reception system is at the "first location" or the "second location;" the only requirement is that the transmission system and the reception system not be at the same location. Clearly then, the terms "first" and "second" are used in the claims of the '702 patent to distinguish between the locations of the transmission system and the reception system," not to provide a numerical limit or serial limitation on the location of the transmission system. See, Gillette, 405 F.3d at 1373, citing, 3M Innovative Properties Co. v. Avery Dennison Corp., 350 F.3d 1365, 1371 (Fed. Cir. 2003) ("use of the terms `first' and `second' is common patent-law convention to distinguish between repeated instances of an element" and should not necessarily be interpreted to impose a serial limitation on a claim.) Although not explicitly stated by the Court, it appears that the Court construed the term "first" to mean "single," i.e., "at a single [first] location." Based on Gillette and 3M, however, the term "first" should not be construed as a numerical limitation, such as "single."
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For all these reasons Acacia respectfully requests the Court to adopt Acacia's proposed reconsidered construction of the phrase "transmission system at a first location." C. Acacia's Grounds for Reconsideration of the Court's Analysis and Construction of the Claim Phrase "Reception System at a Second Location" 1. Acacia's Proposed, Reconsidered Construction of the Phrase "Reception System at a Second Location" Acacia respectfully requests that the Court amend its proposed construction of the phrase "Reception System at a Second Location" to reflect the following changes: "A reception system at one or more particular locations separate from the location of the transmission system." 2. The Factual and Legal Arguments Presented in Connection With Reconsideration of the Construction for "Transmission System at a First Location" Apply With Equal Force to the Reconsideration of the Construction for "Reception System at a Second Location" In its Markman Order, the Court construed the phrase "reception system at a second location" as "a reception system at one particular location separate from the location of the transmission system." (Markman Order, at 31:15-18; Exhibit 1). The Court cited the case of Andrew Corp. v. Gabriel Elec., Inc., 847 F.2d 819 (Fed. Cir. 1988) for the proposition that a patentee may claim less than the entire invention. From this statement, it appears that the Court believed that the invention could encompass reception systems at one or more than one location, but, because the patentees used the terms "at" and "second location," the Court believed the patentee had limited the reception system to a single location, for the same reasons that it did for the transmission system. For the reasons discussed above with respect to "transmission system at a first location," the Court's construction of reception system is incorrect and the patent specification and claims evidence no such narrowing intent. The entire claim is presumptively open-ended, because the claims use the transitional term "comprising." Gillette, 405 F.3d at 1372. Because these are open-

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ended claims, the term "a" in the phrase "at a second location" should be construed to mean "one or more than one." The use of the terms "at" and "second" do not affect this construction.
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For all these reasons, Acacia respectfully requests the Court to adopt Acacia's reconsidered construction of the phrase "reception system at a second location." D. Acacia's Grounds for Reconsideration of the Court's Analysis of the Claim Term "Sequence Encoder" In its Markman Order, the Court held that it could not construe the term "sequence encoder." The Court found that the term "sequence encoder" never appears in the specification of the `702 patent and that the term "sequence encoder" does not have a plain and ordinary meaning. (Markman Order, at 32:4-10; Exhibit 1) The Court also found that one of ordinary skill in the art would not know what a sequence encoder is and would not be able to understand the bounds of the "sequence encoder" claim element, because the term does not appear in the specification of the `702 patent. (Markman Order, at 32:23-24 and 33:12-13; Exhibit 1). The Court held that "the legal consequence of claiming an apparatus which has no plain meaning and which is not defined or referred to in the specification is for the Court to declare the patent claim indefinite." (Markman Order, at 32:11-13; Exhibit 1). The Court also found that the "sequence encoder" of dependent claim 7 of the `702 patent (which adds the limitation that the sequence encoder "transforms digital data blocks into a group of addressable data blocks") is a time encoder that places digital data blocks into a group of addressable data blocks. (Markman Order, at 32:26-33:3; Exhibit 1)

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There is an additional error in the Court's analysis of "reception system" that should be corrected. The Court states at 28:17-18 that: "The term `reception system' does not appear in the specification." This is an incorrect statement, because the term "reception system" does appear numerous times in the specification of the patents. (See, e.g., '702 patent, 3:60-67; 4:7-12; 4:13-17; 4:18-29; 4:30-36; 4:37-42; 4:43-50; 4:51-59; 4:62 - 5:7; 5:8-18; 5:19-29; 5:31-41; 6:39-42; 10:2224; 11:33-36; 12:51-55; 14:28-31; 14:63-65; 15:14-18; 15:62-64; 16:1-8; 16:13-15; 16:24-33; 16:34-45; 16:55-56; 16:64-66; 17:18-27; 17:33-36; 17:55-57; 18:34-45; 18:49-52; 19:4-10; 19:1318; Figures 1a, 1b, 1c, 1d, 1e, 1f, and 1g, Reference Nos. 200, 200', 200'', and 200''', and Figure 6, Reference No. 200; Exhibit 2). Acacia proposes deleting this sentence from the Markman Order. -13-

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1.

The Court Applied the Wrong Legal Standard In Construing "Sequence Encoder"

In its Markman Order, the Court held that "the legal consequence of claiming an apparatus which has no plain meaning and which is not defined or referred to in the specification is for the Court to declare the patent claim indefinite." (Markman Order, at 32:11-13; Exhibit 1). The Court's statement of law is directly contradicted by the Federal Circuit's Bancorp case. Bancorp Serv., LLC v. Hartford Life Ins. Co., 359 F.3d 1367 (Fed. Cir. 2004). As the court held in Bancorp, a patent claim may be definite even though the claim term was not defined or referred to in the specification and even though the claim term has no plain meaning, if the meaning of the term could be inferred by persons of skill in the art from the specification. Bancorp, 359 F.3d at 1372-74 (failure to define a claim term in the specification is not fatal "if the meaning of the term is fairly inferable from the patent."); See also, All Dental Prodx, LLC v. Advantage Dental Products, Inc., 309 F.3d 774, 779 (Fed. Cir. 2002), citing, Edelstein v. Frank, 52 F.3d 1035, 1038 (Fed. Cir. 1995) ("However, the failure of the specification to specifically mention a limitation that later appears in the claims is not a fatal one when one skilled in the art would recognize upon reading the specification that the new language reflects what the specification shows has been invented.")
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Further, the Federal Circuit's test for indefiniteness does not require that the claim term at issue have a plain meaning or that it be defined or referred to in the patent specification: "'Determining whether a claim is definite requires an analysis of `whether one skilled in the art

The Court's statement of law is also directly contradicted by the Manual of Patent Examining Procedure (M.P.E.P.). In the M.P.E.P., patent examiners are instructed that there is no requirement that the words in a claim must match those used in the specification; the only requirement is that the terms used define the invention with a reasonable degree of clarity and precision: The mere fact that a term or phrase used in the claim has no antecedent basis in the specification disclosure does not mean, necessarily, that the term or phrase is indefinite. There is no requirement that the words in the claim must match those used in the specification disclosure. Applicants are given a great deal of latitude in how they choose to define their invention so long as the terms and phrases used define the invention with a reasonable degree of clarity and precision. (M.P.E.P., § 2173.05(e), Seventh Edition, July 1998; Exhibit 6 to Block Decl.). -14-

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would understand the bounds of the claim when read in light of the specification . . . If the claims read in light of the specification reasonably apprise those skilled in the art of the scope of the invention, § 112 demands no more.'' Id. (citing Miles Lab., Inc. v. Shandon, Inc., 997 F.2d 870, 875 (Fed. Cir. 1993))." (Markman Order, at 33:7-11; Exhibit 1). 2. The Court Must Consider Expert Testimony When Determining the Meaning of "Sequence Encoder" In its Markman Order, the Court states that expert testimony may not be useful in construing "sequence encoder," because the term "sequence encoder" does not appear in the patent specification and because "the intrinsic evidence appears unambiguous." (Markman Order, at 33:21 ­ 34:3; Exhibit 1). The Court has invited expert testimony on this issue, presumably to revisit and reexamine this entire issue. By considering expert testimony, the Court avoids potentially reversible error if it were to definitively rule on claim construction or indefiniteness based solely on the intrinsic record. Verve, LLC v. Crane Cams, Inc., 311 F.3d 1116, 1119-1120 (Fed. Cir. 2002); See also AFG Indus., Inc. v. In its Markman Order, the Court also states that "Acacia cannot suggest that the general public is on notice of the scope of the term `sequence encoder' as the term never appears in the specification." (Markman Order, at 33:19-21; Exhibit 1 to Block Decl.; emphasis added). Whether the "general public" is on notice of the scope of "sequence encoder" is irrelevant, because patents are written for persons of ordinary skill in the art, not the general public. W.L. Gore & Associates, Inc. v. Garlock, Inc., 721 F.2d 1540, 1556 (Fed. Cir. 1983) ("Patents, however, are written to enable those skilled in the art to practice the invention, not the public.") Further, a claim is not indefinite merely because it poses a difficult issue of claim construction. Bancorp, 359 F.3d at 1372; S3, Inc. v. nVidia Corp., 259 F.3d 1364, 1369 (Fed. Cir. 2001). If, in light of a fully developed record, the claim is amenable to construction, i.e., it is not insolubly ambiguous, it is not invalid for indefiniteness. Bancorp, 359 F.3d at 1372. Thus, if the meaning of the claim is discernible, "even though the task may be formidable and the conclusion may be one over which reasonable persons will disagree, we have held the claim sufficiently clear to avoid invalidity on indefiniteness grounds." Id., (quoting, Exxon Research & Eng'g Co. v. United States, 265 F.3d 1371, 1375 (Fed. Cir. 2001)). Courts are also instructed, in considering whether a claim is indefinite, to respect the statutory presumption of patent validity and "protect the inventive contribution of patentees, even when the drafting of their patents has been less than ideal." Id. "Close questions of indefiniteness in litigation involving issued patents are properly resolved in favor of the patentee." Bancorp, 359 F.3d at 1372, (quoting, Exxon, 265 F.3d at 1380). In Verve, the Federal Circuit vacated a summary judgment of indefiniteness, which was based solely on the intrinsic record, and remanded for "further proceedings, including any appropriate recourse to extrinsic evidence concerning the usage and understanding of the [disputed] term . . . in relevant context." Verve, at 1120. The Federal Circuit reasoned that: "[T]he court erred
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Cardinal IG Co., 239 F.3d 1239, 1248-49 (Fed. Cir. 2001) (vacating summary judgment that was based on district court's erroneous claim construction: "This case presents a good example of how extrinsic evidence can and should be used to inform a court's claim construction, and how failure to take into account the testimony of persons of ordinary skill in the art may constitute reversible error. . . ."); Key Pharms. v. Hercon Labs. Corp., 161 F.3d 709, 716-18 (Fed. Cir. 1998) ( "[A] trial court is quite correct in hearing and relying on expert testimony on an ultimate claim construction question in cases in which the intrinsic evidence . . . does not answer the question. . . ."). Acacia will be providing expert testimony to the Court on this subject, and it is confident the Court will better understand why the term "sequence encoder" is not indefinite. 3. The `702 Patent Specification and its Claims Teach Persons of Ordinary Skill in the Art that the Sequence Encoder is a Time Encoder In determining the meaning of the term "sequence encoder," the Court must examine the specification of the patent and its claims. See, Phillips, __ F.3d at __, 2005 U.S. App. LEXIS 13954, at *25-28. Here, the specification and the claims of the `702 patent teach persons of ordinary skill in the art that the "sequence encoder," as used in claims 1, 17, 18, and 32, is a time encoder.
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The patent specification teaches one of ordinary skill in the art that the "sequence encoder" is a time encoder: The transmission system 100 of the present invention also preferably includes ordering means for placing the formatted information into a sequence of in law, in requiring that the intrinsic evidence of the specification and prosecution history is the sole source of meaning of words that are used in a technologic context. . . . The question is not whether the [disputed term] has a fixed meaning ..., but how the phrase would be understood by persons experienced in[the] field ..., upon reading the patent documents." Id. at 1119-1120. At the evidentiary hearing on September 8 and 9, Acacia shall present the expert testimony of Mr. S. Merrill Weiss and Dr. Peter Alexander, both of whom (from the perspectives of different education and experience in the same relevant art, both of whom are competent to testify on this precise issue) will testify that, based on the teachings of the specification and based on the knowledge and understanding of one of ordinary skill in the art, such a person would have understood the meaning of "sequence encoder" in January 1991 to be a time encoder. The substance of Mr. Weiss' and Dr. Alexander's testimony is substantially contained in their declarations which Acacia filed on October 20, 2004 in the Central District of California litigation in connection with Acacia's opposition to defendants' motion for summary judgment. -1611

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addressable data blocks. As shown in FIG. 2a, the ordering means in the preferred embodiment includes time encoder 114. . . . The sequence of addressable data blocks which was time encoded and output by time encoder 114 is preferably sent to precompression processor 115." (`702 patent, at 7:50-54; 8:46-49; emphasis added). Thus, one of ordinary skill in the art, when reading the claims in light of the patent specification, would understand the term "sequence encoder" to be a "time encoder." See, Phillips, __ F.3d at __, 2005 U.S. App. LEXIS 13954, at *24 ("Importantly, the person of ordinary skill in the art is deemed to read the claim term not only in the context of the particular claim in which the disputed term appears, but in the context of the entire patent, including the specification.") That the "sequence encoder" of claim 1 is understood to be a time encoder is confirmed by the presence of dependent claim 7.
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"Under the doctrine of claim differentiation, `each claim in a

patent is presumptively different in scope.'" See, Ecolab, Inc. v. Paraclipse, Inc., 285 F.3d 1362, 1375 (Fed. Cir. 2002), quoting, Intermatic, Inc. v. Lamson & Sessions Co., 273 F.3d 1355, 1364 (Fed. Cir. 2001). Claim 1 identifies a "sequence encoder," but does not describe in the claim any function of the "sequence encoder." Claim 7 depends from claim 1 and adds the functional limitation that the "sequence encoder transforms digital data blocks into a group of addressable data blocks." The functional limitation of claim 7 further defines a particular capability of the sequence encoder, which is not expressly described in claim 1.
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Other functions of the sequence encoder (time

Further evidence that the "sequence encoder" refers to the time encoder is found in claim 17 of the `702 patent. See, Phillips, __ F.3d at __, 2005 U.S. App. LEXIS 13954, at *28 ("Because claim terms are normally used consistently throughout the patent, the usage of one term in one claim can often illuminate the meaning of the same term in other claims.") In claim 17, the sequence encoder is "in data communication with said digital data output [of the converter]." (`702 patent, 20:50-51). As shown in Figure 2a of the `702 patent, the time encoder 114 is in data communication with the converter 113. Claim 7 of the `702 patent depends from claim 1 and adds the limitation that "said sequence encoder transforms digital data blocks into a group of addressable data blocks." Claim 33 of the `702 patent depends from claim 32, which depends from claim 27, and adds the same limitation.
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Functional limitations are permitted, as described in M.P.E.P. § 2173.05(g):
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encoder) than that single function described in claim 7 are clearly described in the patent specification. These include, among others, receipt of audio and video data from the converter, `702 patent at 8;6-9; the assignment of relative time markers by the time encoder to the audio and video data as it passes from the converter through the time encoder, Id.; and delivery of a sequence of addressable data blocks as its output to the precompression processor, `702 patent, Col. 8:46-48. As will be fully explained through expert testimony, the patent specification adequately informs one of ordinary skill in the art concerning the meaning of the term "sequence encoder." 4. The Court's Finding that the "Sequence Encoder" In Claim 7 is a Time Encoder Which Transforms Digital Data Blocks Into a Group of Addressable Data Blocks Confirms that "Sequence Encoder" in Claim 1 is a "Time Encoder" In its Markman Order, the Court understood that the term "sequence encoder" of claim 7 is a "time encoder" which performs the additional functions set forth in claim 7 of transforming digital data blocks into a group of addressable data blocks: A time encoder that is described in dependent claim 7 of the `702 patent is a limitation describing an additional function of the sequence encoder but does "A functional limitation is an attempt to define something by what it does, rather than by what it is (e.g., as evidenced by its specific structure or specific ingredients). There is nothing inherently wrong with defining some part of an invention in functional terms. Functional language does not, in and of itself, render a claim improper. In re Swinehart, 439 F.2d 210, 169 USPQ 226 (CCPA 1971). A functional limitation must be evaluated and considered, just like any other limitation of the claim, for what it fairly conveys to a person of ordinary skill in the pertinent art in the context in which it is used. A functional limitation is often used in association with an element, ingredient, or step of a process to define a particular capability or purpose that is served by the recited element, ingredient or step." (M.P.E.P., § 2173.05(g), Seventh Edition, July 1998; Exhibit 6 to Block Decl.). The Court obviously had no difficulty determining that the "sequence encoder" is a "time encoder" that performs the functions of claim 7. In fact, the adult internet defendants who argued the original Markman proceedings instructed the Court that claim 7 should be construed as a time encoder that performs the algorithm of a time encoder. (See Defendants' Responsive Claim Construction Brief re `702 Patent at 18:4-6; Exhibit 7 to Block Decl.) -1815 15

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CASE NO. 05-CV-01114 JW

ACACIA'S MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION FOR MARKMAN RECONSIDERATION

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not assist one skilled in the art with defining the boundaries of the claimed element, "a sequence encoder." (Markman Order, at 32:26 ­ 33:3; emphasis added). Although the Court correctly found that the "sequence encoder" of claim 7 is a time encoder with the additional functional limitation of transforming digital data blocks into a group of addressable data blocks, the Court stated that claim 7 does not assist one skilled in the art with defining the boundaries of the "sequence encoder."
16

This is not the case, as will be demonstrated

by expert testimony. If the "sequence encoder" of claim 7 is understood to be a time encoder with the additional function of transforming digital data blocks into a group of addressable data blocks, as indicated by the Court in its Markman Order, then, pursuant to the doctrine of claim differentiation, the sequence encoder of claim 1 must be broader, i.e., a time encoder that is not limited to this function. See Ecolab, 285 F.3d at 1375; Phillips, __ F.3d at __, 2005 U.S. App. LEXIS 13954, at *60-61.
17

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As described above, the patent specification teaches a number of functions of the

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sequence encoder (time encoder) beyond the single function identified in claim 7. (`702 patent, at 7:54-8:12; 8:47-49). To the extent that the Court believes that there remains any ambiguity in construing "sequence encoder," the Court should apply the doctrine that "claims should be so construed, if possible, as to sustain their validity." Phillips, __ F.3d at __, 2005 U.S. App. LEXIS 13954, at *6465, quoting, Liebel-Flarsheim Co. v. Medrad, Inc., 358 F.3d 898, 911 (Fed. Cir. 2004), and Rhine v. Casio, Inc., 183 F.3d 1342, 1345 (Fed. Cir. 1999). In this case, it is reasonable to infer that the PTO would not have issued an invalid patent. Phillips, __ F.3d at __, 2005 U.S. App. LEXIS 13954, at *66. In allowing claims 1 and 7 of the `702 patent, the Examiner focused on the term "sequence encoder." The Patent Examiner refused to allow original claim 33 (corresponding to claim 1 of the `702) without the "sequence en