Personalized User Model LLP v. Google Inc.

Filing 218

REDACTED VERSION of 217 Answer to Counterclaim, Plaintiff Personalized User Model, L.L.P.'s and Counter-Defendants' Reply to Defendant Google, Inc.'s Amended Counterclaims by Personalized User Model LLP. (Tigan, Jeremy)

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE PERSONALIZED USER MODEL, L.L.P., ) ) Plaintiff, ) ) v. ) ) GOOGLE, INC., ) ) Defendant. ) ______________________________________ ) C.A. No. 09-525 (LPS) GOOGLE, INC., ) ) PUBLIC VERSION Counterclaimant, ) ) v. ) ) PERSONALIZED USER MODEL, L.L.P. ) and YOCHAI KONIG, ) ) Counterclaim-Defendants. ) ______________________________________ ) ) PLAINTIFF PERSONALIZED USER MODEL, L.L.P.'S AND COUNTER-DEFENDANTS REPLY TO DEFENDANT GOOGLE, INC.'S AMENDED COUNTERCLAIMS MORRIS, NICHOLS, ARSHT & TUNNELL LLP Karen Jacobs Louden (#2881) Jeremy A. Tigan (#5239) 1201 N. Market Street P.O. Box 1347 Wilmington, DE 19899-1347 [phone] [e-mail] [e-mail] Attorneys for Personalized User Model, L.L.P. and Yochai Konig

OF COUNSEL: Marc S. Friedman SNR Denton US LLP 1221 Avenue of the Americas New York, NY 10020-1089 [phone] Jennifer D. Bennett SNR Denton US LLP 1530 Page Mill Road, Ste. 200 Palo Alto, CA 94304-1125 [phone]

Confidential Version Filed: March 11, 2011 Public Version Filed: March 15, 2011

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE
) ) ) Plaintiff, ) ) v. ) GOOGLE, INC., ) ) Defendant. ) ______________ ) ) GOOGLE, INC., ) Counterclaimant, ) ) ) v. ) ) PERSONALIZED USER MODEL, L.L.P. and YOCHAI KONIG, ) ) ) Counterclaim-Defendants. )

PERSONALIZED USER MODEL, L.L.P.,

C.A. No. 09-525 (LPS)

PUBLIC VERSION

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PLAINTIFF PERSONALIZED USER MODEL, L.L.P.'S AND COUNTER-DEFENDANTS REPLY TO DEFENDANT GOOGLE, INC.'S AMENDED COUNTERCLAIMS

Plaintiff and Counterclaim-Defendant Personalized User Model, LLP ("P.U.M.") and Counterclaim-Defendant Yochai Konig (referred to collectively as "CounterclaimDefendants"), in reply to the Amended Counterclaims of Defendant, Google, Inc. ("Google"), filed with this Court on February 4,2011, state:
Parties

1. Counterclaims.

Counterclaim-Defendants admit the allegations in paragraph 1 of Google's

2.

Counterclaim-Defendants deny P.U.M. is a "corporation" and state it is a Counterclaim-Defendants otherwise admit the allegations in

limited liability partnership.

paragraph 2 of Google's Counterclaims. 3. Counterclaims.
Jurisdiction and Venue

Counterclaim-Defendants admit the allegations in paragraph 3 of Google's

4. Counterclaims. 5.

Counterclaim-Defendants admit the allegations in paragraph 4 of Google's

Counterclaim-Defendants deny that the interests and convenience of the

parties, the public, and the courts would be better served by transferring this case to the Northern District of California. Counterclaim-Defendants otherwise admit the remaining allegations in paragraph 5 of Google's Counterclaims.
Facts and Background

6.

Counterclaim-Defendants admit the allegations of the first sentence of Counterclaim-Defendants admit that the second

paragraph 6 of Google's Counterclaims.

sentence contains an excerpt from SRI's webpage, but otherwise denies the allegations of that sentence. 7. Counterclaims. Counterclaim-Defendants admit the allegations in paragraph 7 of Google's

REDACTED

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REDACTED

Counterclaim-Defendants deny any implication that Dr.

Konig's work for SRI was in any way related to the patents-in-suit. 9. Counterclaims. 10. Counterclaim-Defendants state that the Employment Agreement speaks Counterclaim-Defendants admit the allegations in paragraph 9 of Google's

for itself and otherwise denies the allegations in paragraph 10 of Google' s Counterclaims. 11. Counterclaim-Defendants state that the Employment Agreement speaks

for itself and otherwise denies the allegations in paragraph 11 of Google' s Counterclaims. 12. Counterclaim-Defendants state that Dr. Konig conceived or reduced to

practice the inventions of the patents-in-suit after Dr. Konig left his employment by SRI.

REDACTED

REDACTED

To the extent inconsistent with this paragraph 12

of Counterclaim-Defendants' reply, Counterclaim-Defendants deny the remaining allegations in paragraph 12 of Google's Counterclaims. 13. Paragraph 13 states a legal conclusion to which no response is required.

To the extent a response is required, Counterclaim-Defendants deny Google's allegations concerning the inventions in paragraph 13 of Google' s Counterclaims. 14. Paragraph 14 states a legal conclusion to which no response is required.

To the extent a response is required, Counterclaim-Defendants deny Google's allegations concerning the inventions in paragraph 14 of Google's Counterclaims. Counterclaim-

Defendants state that the inventions in the patents-in-suit are unrelated to SRI's business, or actual or demonstrably anticipated research or development. Counterclaim-Defendants also

deny that Google accurately paraphrases the SRI websites that Google's cites, and CounterclaimDefendants state that the websites speak for themselves. To the extent any further response is required, Counterclaim-Defendants deny the remaining allegations in paragraph 14 of Google's Counterclaims. 3

15.

Counterclaim-Defendants admit that the patents use the words "learning

machine" and admit that one can use learning machines in the field of artificial intelligence. Counterclaim-Defendants deny, however, any implication in paragraph 15 of Google's Counterclaims that the patents are related to SRI's business, research, or development solely by virtue of the fact that the patents involve a large field of research of computer science called artificial intelligence. To the extent any further response is required, Counterclaim-Defendants deny the remaining allegations in paragraph 15 of Google' s Counterclaims. 16. Counterclaim-Defendants admit that the patents-in-suit's abstracts disclose

a method for providing automatic, personalized services to a computer user but CounterclaimDefendants otherwise deny the remaining allegations in paragraph 16 of Google's Counterclaims. 17. REDACTED REDACTED

REDACTED

Counterclaim-Defendants

deny that the patents-in-suit resulted from Dr. Konig's work for SRI and deny the remaining allegations in paragraph 17 of Google' s counterclaim. 18. REDACTED REDACTED REDACTED Counterclaim-Defendants state that Dr. Konig did not conceive of the

inventions until after he left SRI's employment and that his work at SRI did not relate to the inventions. Counterclaim-Defendants deny the remaining allegations in paragraph 18 of REDACTED

Google's Counterclaims. 19. REDACTED

Counterclaim-Defendants deny the remaining allegations in paragraph 19 of

Google's Counterclaims.

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20.

Counterclaim-Defendants admit that the emails contain the language

quoted in Paragraph 20 though Defendants note that Google has quoted words across two pages as if they were in one sentence. Counterclaim-Defendants deny the allegations of paragraph 20 of Google' s Counterclaims. 21. Counterclaim-Defendants admit that the patents-in-suit contain the quotes

in Paragraph 21 of Google's Counterclaim, but deny that the patents resulted from Dr. Konig's work for SRI. Counterclaim-Defendants deny the remaining allegations in paragraph 21 of

Google's Counterclaims. 22. Counterclaim-Defendants admit only that Dr. Konig never assigned the

inventions of the patents-in-suit to SRI and that he instead assigned the inventions to Utopy. Counterclaim-Defendants deny the remaining allegations in paragraph 22 of Google's Counterclaims. 23. Counterclaim-Defendants

REDACTED

REDACTED deny the remaining allegations in paragraph 23 of Google's Counterclaims.
COUNT I: Declaratory Judgment of Non-Infringement of the '040 Patent

24.

As to the allegations in Paragraph 24 of Google's Counterclaims,

Counterclaim-Defendants incorporate by reference each of their responses to paragraphs 1 through 23 above, and do not respond to the allegations in paragraphs 1 through 15 of Google's Answer, incorporated by reference in the Counterclaims, as no response is required. 25. Counterclaim-Defendants admit the allegations in paragraph 25 of

Google's Counterclaims. 26. Counterclaim-Defendants admit the allegations
III

paragraph 26 of

Google's Counterclaims. 27. Counterclaim-Defendants deny the allegations
III

paragraph 27 of

Google's Counterclaims.

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COUNT II: Declaratory Judgment of Non-Infringement of the '031 Patent

28.

As to the allegations in Paragraph 28 of Google's Counterclaims,

Counterclaim-Defendants incorporate by reference each of their responses to paragraphs 1 through 27 above, and do not respond to the allegations in paragraphs 1 through 15 of Google's Answer, incorporated by reference in the Counterclaims, as no response is required. 29. Counterclaim-Defendants admit the allegations in paragraph 29 of

Google's Counterclaims. 30. Counterclaim-Defendants admit the allegations m paragraph 30 of

Google's Counterclaims. 31. Counterclaim-Defendants deny the allegations m paragraph 31 of

Google's Counterclaims.
COUNT III: Declaratory Judgment of Non-Infringement of the '276 Patent

32.

As to the allegations in Paragraph 32 of Google's Counterclaims,

Counterclaim-Defendants incorporate by reference each of their responses to paragraphs 1 through 31 above, and do not respond to the allegations in paragraphs 1 through 15 of Google's Answer, incorporated by reference in the Counterclaims, as no response is required. 33. Counterclaim-Defendants admit the allegations in paragraph 33 of

Google's Counterclaims. 34. Counterclaim-Defendants admit the allegations m paragraph 34 of

Google's Counterclaims. 35. Counterclaim-Defendants deny the allegations m paragraph 35 of

Google's Counterclaims.
COUNT IV: Declaratory Judgment of Invalidity and/or Unenforceability of the '040 Patent

36.

As to the allegations in Paragraph 36 of Google's Counterclaims,

Counterclaim-Defendants incorporate by reference each of their responses to paragraphs 1 through 35 above, and do not respond to the allegations in paragraphs 1 through 15 of Google's Answer, incorporated by reference in the Counterclaims, as no response is required.
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37.

Counterclaim-Defendants deny the allegations

III

paragraph 37 of

Google's Counterclaims.
COUNT V: Declaratory Judgment of Invalidity and/or Un enforceability of the '031 Patent

38.

As to the allegations in Paragraph 38 of Google's Counterclaims,

Counterclaim-Defendants incorporate by reference each of their responses to paragraphs 1 through 37 above, and do not respond to the allegations in paragraphs 1 through 15 of Google's Answer, incorporated by reference in the Counterclaims, as no response is required. 39. Counterclaim-Defendants deny the allegations in paragraph 39 of

Google's Counterclaims.
COUNT VI: Declaratory Judgment of Invalidity and/or Un enforceability of the '276 Patent

40.

As to the allegations in Paragraph 40 of Google's Counterclaims,

Counterclaim-Defendants incorporate by reference each of their responses to paragraphs I through 39 above, and do not respond to the allegations in paragraphs 1 through 15 of Google' s Answer, incorporated by reference in the Counterclaims, as no response is required. 41. Counterclaim-Defendants deny the allegations in paragraph 41 of

Google's Counterclaims.
COUNT VII: (Declaration regarding ownership)

42.

As to the allegations in Paragraph 42 of Google's Counterclaims,

Defendants incorporate by reference each of their responses to paragraphs 1 through 41 above, and do not respond to the allegations in paragraphs 1 through 15 of Google's Answer, incorporated by reference in the Counterclaims, as no response is required. 43. Counterclaim-Defendants deny the allegations in paragraph 43 of

Google's Counterclaims. 44. Counterclaim-Defendants admit that Dr. Konig had an employment

agreement with SRI, but deny that the patents-in-suit are covered by the agreements and otherwise deny the allegations in paragraph 44 of Google' s Counterclaims.
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45.

Counterclaim-Defendants deny the allegations

In

paragraph 45 of

Google's Counterclaims. 46. Counterclaim-Defendants deny the allegations
In

paragraph 46 of

Google's Counterclaims.
COUNT VIII: Breach of Contract (Against Dr. Konig)

47.

As to the allegations in Paragraph 47 of Google's Counterclaims,

Counterclaim-Defendants incorporate by reference each of their responses to paragraphs 1 through 46 above, and do not respond to the allegations in paragraphs I through 15 of Google's Answer, incorporated by reference in the Counterclaims, as no response is required. 48. Counterclaim-Defendants deny the allegations in paragraph 48 of

Google's Counterclaims. 49. Counterclaim-Defendants state that the agreement did not apply to the

inventions in the patents-in-suit and otherwise deny the allegations in paragraph 49 of Google's Counterclaims. 50. Counterclaim-Defendants deny the allegations
In

paragraph 50 of

Google's Counterclaims.
COUNT IX: Conversion (Against Dr. Konig and PUM)

51.

As to the allegations in Paragraph 51 of Google's Counterclaims,

Counterclaim-Defendants incorporate by reference each of their responses to paragraphs 1 through 50 above, and do not respond to the allegations in paragraphs 1 through 15 of Google's Answer, incorporated by reference in the Counterclaims, as no response is required. 52. Counterclaim-Defendants deny the allegations in paragraph 52 of

Google's Counterclaims. 53. Counterclaim-Defendants admit that Dr. Konig transferred the

applications which matured into patents-in-suit to Utopy and that PUM ultimately acquired them, but they deny the allegations in paragraph 53 of Google' s Counterclaims.

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54.

Counterclaim-Defendants deny the allegations

III

paragraph 54 of

Google's Counterclaims. COUNT X: Imposition of Constructive Trust (Against Dr. Konig and PUM) 55. As to the allegations in Paragraph 55 of Google's Counterclaims,

Counterclaim-Defendants incorporate by reference each of their responses to paragraphs 1 through 54 above, and do not respond to the allegations in paragraphs 1 through 15 of Google's Answer, incorporated by reference in the Counterclaims, as no response is required. 56. Counterclaim-Defendants deny the allegations in paragraph 56 of

Google's Counterclaims. 57. Counterclaim-Defendants deny the allegations
III

paragraph 57 of

Google's Counterclaims. Exceptional Case 58. Counterclaim-Defendants deny the allegations
III

paragraph 58 of

Google's Counterclaims. FIRST AFFIRMATIVE DEFENSE: Statute of Limitations 59. Google's claims under Count VII (Declaration of Google's rights as co-

owner), Count VIII (Breach of Contract), Count IX (Conversion), and Count X (Constructive Trust) are barred, in whole or in part, by the statute of limitations. SECOND AFFIRMATIVE DEFENSE: Laches 60. The doctrine of laches bars Google from obtaining all, or part, of the relief

it seeks in Count VII (Declaration of Google's rights as co-owner), Count VIII (Breach of Contract), Count IX (Conversion), and Count X (Constructive Trust). Due to the unreasonable delay in bringing suit under these counts, witness' memories have faded and relevant documents have been lost, destroyed, or misplaced in the ordinary course of business. THIRD AFFIRMATIVE DEFENSE: Standing 61. Google lacks standing to bring its claims under Count VII (Declaration of

Google's rights as co-owner), Count VIII (Breach of Contract), Count IX (Conversion), and 9

Count X (Constructive Trust). Google never acquired any ownership interest in the patents-insuit because SRI never had any ownership rights and because Google's purchase agreement was a sham transaction.

FOURTH AFFIRMATIVE DEFENSE: Good faith purchaser
62. Google is barred by the good faith purchaser defense under 35 U.S.C.

§ 261 from seeking relief from PUM under Count VII (Declaration of Google's rights as coowner), Count VIII (Breach of Contract), Count IX (Conversion), and Count X (Constructive Trust). PUM and its predecessors in interest purchased its interests in the patents-in-suit for valuable consideration without notice of SRI's alleged assignment.

EXCEPTIONAL CASE
63. On information and belief, this is an exceptional case entitling

Counterclaim-Defendants to an award of their attorneys' fees incurred in connection with defending against Google's Counterclaims under Counts VII through X pursuant to 35 U.S.C.
§ 285 as a result of, among other things, Google's assertion of ownership claims under those

counts with the knowledge that Google's ownership is predicated on a sham transaction with an entity that has no rights in the patents-in-suit and that PUM has legal title to and is the sole owner of the patents-in-suit.

Prayer
WHEREFORE, Counterclaim-Defendants respectfully request that the relief Google requests be denied and that Counterclaim-Defendants be granted the following relief with respect to Google's Counterclaims: 1. That judgment be entered in favor of Counterclaim-Defendants on each of

Google's Counterclaims, and that Google take nothing by reason of its Counterclaims; 2. That Counterclaim-Defendants be awarded their attorneys' fees and costs

of suit incurred in defense of Google' s Counterclaims; and 3. Such other and further relief as the Court may deem just and proper.

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MORRIS. NICHOLS, ARSHT & TUNNELL LLP

lsi 'l(aren Jaco6s Louaen
Karen Jacobs Louden (#2881) Jeremy A. Tigan (#5239) 1201 N. Market Street P.O. Box 1347 Wilmington, DE 19899-1347 [phone] [e-mail] [e-mail]
Attorneys for Personalized User Model, L.L.P. and Yochai Konig

OF COUNSEL: Marc S. Friedman SNR Denton US LLP 1221 Avenue of the Americas New York, NY 10020-1089 [phone] Jennifer D. Bennett SNR Denton US LLP 1530 Page Mill Road, Ste. 200 Palo Alto, CA 94304-1125 [phone] March 11,2011
4132732

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CERTIFICATE OF SERVICE I hereby certify that on March 15, 2011, I caused the foregoing to be electronically filed with the Clerk of the Court using CM/ECF which will send electronic notification of such filing to all registered participants. Additionally, I hereby certify that true and correct copies of the foregoing were caused to be served on March 15, 2011, upon the following individuals in the manner indicated: BY E-MAIL Richard L. Horwitz David E. Moore POTTER ANDERSON & CORROON LLP 1313 N. Market St., 6th Floor Wilmington, DE 19801 BY E-MAIL Brian C. Cannon QUINN EMANUEL URQUHART & SULLIVAN, LLP 555 Twin Dolphin Dr., 5th Floor Redwood Shores, CA 94065 Charles K. Verhoeven David A. Perlson Antonio R. Sistos Andrea Pallios Roberts Joshua Lee Sohn QUINN EMANUEL URQUHART & SULLIVAN, LLP 50 California Street, 22nd Floor San Francisco, CA 94111

/s/ Jeremy A. Tigan
______________________________________ Jeremy A. Tigan (#5239)