DivX, LLC

Patent Trials and Appeals Board

Aug 23, 2021

IPR2020-00558 (P.T.A.B. Aug. 23, 2021)

Trials@uspto.gov Paper 50
571-272-7822 Entered: August 23, 2021

UNITED STATES PATENT AND TRADEMARK OFFICE
____________
BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________
NETFLIX, INC. and HULU, LLC,
Petitioner,
v.
DIVX, LLC,
Patent Owner.
____________
IPR2020-00558
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____________

Before KEVIN F. TURNER, BART A. GERSTENBLITH, and
IFTIKHAR AHMED, Administrative Patent Judges.

TURNER, Administrative Patent Judge.

JUDGMENT
Final Written Decision
Determining No Challenged Claims Unpatentable
Granting In Part, Denying In Part, and Dismissing In Part Petitioner’s
Motion to Exclude
35 U.S.C. § 318(a)

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I. INTRODUCTION
We have jurisdiction to hear this inter partes review under 35 U.S.C.
§ 6. This Final Written Decision is issued pursuant to 35 U.S.C. § 318(a).
For the reasons discussed herein, we determine that Petitioner has not
shown, by a preponderance of the evidence, that claims 1–24 of U.S. Patent
No. 10,225,588 B2 (Ex. 1001, “the ’588 Patent”) are unpatentable.
A. Procedural Background
Netflix, Inc. and Hulu, LLC (collectively, “Petitioner”) filed a Petition
(Paper 3, “Pet.”) requesting institution of inter partes review of claims 1–24
of the ’588 Patent. DivX, LLC (“Patent Owner”) filed a Preliminary
Response (Paper 7, “Prelim. Resp.”). We additionally authorized the filing
of a Reply by Petitioner (Paper 8) to Patent Owner’s Preliminary Response
and a Sur-reply by Patent Owner (Paper 9) to further consider the arguments
of the parties with respect to the application of our discretion under 35
U.S.C. § 325(d).
Pursuant to 35 U.S.C. § 314(a), on August 26, 2020, we instituted
inter partes review on the ground of:
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Claims Challenged 35 U.S.C. §1 References
1–24 103(a) Chen,2 Lindahl,3 Hurst4
See Pet. 12; Paper 10 (“Dec.”). Petitioner relies upon a Declaration by Dr.
Patrick D. McDaniel (Ex. 1003).
Patent Owner filed a Patent Owner Response (Paper 17, “PO Resp.”),
along with a Declaration of Dr. Seth Nielson (Ex. 2012) to support its
positions. Petitioner filed a Reply (Paper 29, “Pet. Reply”) to the Patent
Owner Response, along with an additional Declaration of Dr. McDaniel
(Ex. 1031). Patent Owner filed a Sur-reply to Petitioner’s Reply (Paper 40,
“PO Sur-reply”), along with a Declaration of Dr. Chandrajit Bajaj
(Ex. 2027), that had been made of record in another proceeding. An oral
hearing was held on May 25, 2021. A transcript of the hearing is included in
the record. Paper 49.
Additionally, for the reasons explained herein, we grant, deny, and
dismiss, in part, Petitioner’s Motion to Exclude (Paper 42). See Section III.
B. Related Matters
Petitioner and Patent Owner identify the following related matters:
DivX, LLC v. Netflix, Inc., No. 2:19-cv-01602 (C.D. Cal.); DivX, LLC v.
Hulu, Inc., No. 2:19-cv-01606 (C.D. Cal.). Pet. 84; Paper 5, 1.

1 The Leahy-Smith America Invents Act (“AIA”), Pub. L. No. 112–29, 125
Stat. 284, 287–88 (2011), amended 35 U.S.C. § 103. Because the effective
filing date of the challenged claims of the ’558 Patent is before March 16,
2013 (the effective date of the relevant amendment), the pre-AIA version of
§ 103 applies. See Ex. 1001, codes (60), (63).
2 U.S. Patent Application Publication No. US 2011/0096828 A1, published
April 28, 2011 (Ex. 1006, “Chen”).
3 U.S. Patent Application Publication No. US 2007/0083467 A1, published
April 12, 2007 (Ex. 1007, “Lindahl”).
4 U.S. Patent No. 8,683,066 B2, issued March 25, 2014 (Ex. 1008, “Hurst”).
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C. The ’588 Patent
The ’588 Patent is directed to “[s]ystems and methods for performing
adaptive bitrate streaming using alternative streams of protected content.”
Ex. 1001, code (57). The Background section of the ’588 Patent details that
“content can be divided into audio, video, and subtitle streams and some
streams can be encoded as alternative streams that are suitable for different
network connection bandwidths or comply with specific geographic
restrictions and/or other restrictions.” Id. at 1:54–58. That same section also
details that adaptive bit rate streaming involves “detecting the present
streaming conditions . . . in real time and adjusting the quality of the
streamed media accordingly by selecting between different streams encoded
for use at different network connection data rates.” Id. at 1:60–64. The
Background section of the ’588 Patent also details that “[i]n adaptive
streaming systems, the source media is typically stored on a media server as
a top level index file pointing to a number of alternate streams that contain
the actual video and audio data. Each stream is typically stored in one or
more container files.” Id. at 2:12–16. The ’588 Patent also confirms that it
was known to protect content “using cryptographic information such as (but
not limited to) one or more encryption keys to encrypt some or all of the
content.” Id. at 2:52–54 (emphasis added).
The ’588 Patent describes, according to specific embodiments, that a
system uses a top level index file identifying the alternative streams of
protected video, with each including partially encrypted video frames
encrypted using a set of common keys. Ex. 1001, 16:43–49, 23:24–28. A
copy of the set of common keys is obtained and the streaming conditions for
the playback device are detected. Id. at 23:46–51. A stream is selected,
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based on those conditions, and a container index is used to determine the
byte ranges for portions of those streams, which are then requested. Id. at
24:51–57, 25:6–10. Based on encryption information that identifies
encrypted portions of the frames of video, the encrypted portions are
decrypted using the set of common keys and the streamed video is played
back. Id. at 25:10–21.
Challenged claims 1 and 12 are independent. Claim 1 is illustrative of
the claimed subject matter and is reproduced below, with Petitioner’s
bracketing added for reference:
1. [a] A playback device for playing protected content from
a plurality of alternative streams, comprising:
[b] a set of one or more processors; and
a non-volatile storage containing an application for causing the
set of one or more processors to perform the steps of:
[c] obtaining a top level index file identifying a plurality of
alternative streams of protected video, [d] wherein each of
the alternative streams of protected video includes partially
encrypted video frames [e] that are encrypted using a set of
common keys comprising at least one key, [f] and wherein
the partially encrypted video frames contain encrypted
portions and unencrypted portions of data;
[g] obtaining a copy of the set of common keys;
[h] detecting streaming conditions for the playback device;
[i] selecting a stream from the plurality of alternative streams
of protected video based on the detected streaming
conditions;
[j] receiving a container index that provides byte ranges for
portions of the selected stream of protected video within an
associated container file;
[k] requesting portions of the selected stream of protected
video based on the provided byte ranges;
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[l] locating encryption information that identifies encrypted
portions of frames of video within the requested portions of
the selected stream of protected video;
[m] decrypting each encrypted portion of the frames of video
identified within the located encryption information using
the set of common keys; and
[n] playing back the decrypted frames of video obtained from
the requested portions of the selected stream of protected
video.
Ex. 1001, 27:30–63.
II. ANALYSIS
A. Level of Ordinary Skill in the Art
Petitioner, supported by Dr. McDaniel’s testimony, proposes that a
person of ordinary skill in the art at the time of the invention (“POSITA”)
would have had “a bachelor’s degree in mechanical engineering, electrical
engineering, computer science, or a similar field with at least two years of
experience in video streaming and media security or . . . a master’s degree in
mechanical engineering, electrical engineering, computer science, or a
similar field with a specialization in video streaming and media security.”
Pet. 14–15 (citing Ex. 1003 ¶¶ 65–67). Patent Owner does not refute
Petitioner’s assessment and appears to apply such a level of skill in its
arguments against combining Chen, Lindahl, and Hurst to teach or suggest
the elements of the challenged claims. See generally PO Resp.
As such, we continue to adopt and apply Petitioner’s unopposed
position as to the level of ordinary skill in the art for purposes of this
decision. See Dec. 6.
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B. Claim Construction
In this inter partes review, “claims are construed using the same claim
construction standard that would be used to construe the claim[s] in a civil
action under 35 U.S.C. § 282(b).” See 37 C.F.R. § 42.100(b) (2019). The
claim construction standard includes construing claims in accordance with
their ordinary and customary meaning as understood by one of ordinary skill
in the art at the time of the invention. See id.; Phillips v. AWH Corp., 415
F.3d 1303, 1312–14 (Fed. Cir. 2005) (en banc). In construing claims in
accordance with their ordinary and customary meaning, we take into account
the specification and prosecution history. Phillips, 415 F.3d at 1315–17.
If the specification “reveal[s] a special definition given to a claim
term by the patentee that differs from the meaning it would otherwise
possess[,] . . . the inventor’s lexicography governs.” Phillips, 415 F.3d at
1316 (citing CCS Fitness, Inc. v. Brunswick Corp., 288 F.3d 1359, 1366
(Fed. Cir. 2002)). Another exception to the general rule that claims are
given their ordinary and customary meaning is “when the patentee disavows
the full scope of a claim term either in the specification or during
prosecution.” Uship Intellectual Props., LLC v. United States, 714 F.3d
1311, 1313 (Fed. Cir. 2013) (quoting Thorner v. Sony Computer Entm’t Am.,
LLC, 669 F.3d 1362, 1365 (Fed. Cir. 2012)).
Additionally, only terms that are in controversy need to be construed,
and these need be construed only to the extent necessary to resolve the
controversy. See Vivid Techs., Inc. v. Am. Sci. & Eng’g, Inc., 200 F.3d 795,
803 (Fed. Cir. 1999) (holding that “only those terms need be construed that
are in controversy, and only to the extent necessary to resolve the
controversy”); Nidec Motor Corp. v. Zhongshan Broad Ocean Motor Co.,
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868 F.3d 1013, 1017 (Fed. Cir. 2017) (citing Vivid Techs. in the context of
an inter partes review).
Petitioner does not present any specific claim terms for construction.
Petitioner contends that “the challenged claims are invalid under their plain
and ordinary meaning.” Pet. 16 (citing Ex. 1003 ¶¶ 100–101). Patent
Owner, likewise, does not proffer any specific constructions for claim terms.
See generally PO Resp. As such, we apply the plain and ordinary meaning
of each claim term in the analysis below.
We note that Patent Owner continues to advocate for a particular
understanding of limitation [l] of claim 1, as it did in its Preliminary
Response. Compare Prelim. Resp. 26–39, with PO Resp. 24–38, and PO
Sur-reply 1–8. Although we continue to find Patent Owner’s arguments
about limitation [l] to be unpersuasive, we need not resolve the issue as we
determine that Petitioner has not shown, by a preponderance of the evidence,
that the challenged claims are unpatentable on another basis. See Dec. 27–
31 (discussion of Patent Owner’s arguments and our rejection of its implicit
construction).
C. Legal Standards – Obviousness
The U.S. Supreme Court set forth the framework for applying the
statutory language of 35 U.S.C. § 103 in Graham v. John Deere Co. of
Kansas City, 383 U.S. 1, 17–18 (1966):
Under § 103, the scope and content of the prior art are to be
determined; differences between the prior art and the claims at
issue are to be ascertained; and the level of ordinary skill in the
pertinent art resolved. Against this background, the obviousness
or nonobviousness of the subject matter is determined. Such
secondary considerations as commercial success, long felt but
unsolved needs, failure of others, etc., might be utilized to give
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light to the circumstances surrounding the origin of the subject
matter sought to be patented.
As explained by the Supreme Court in KSR International Co. v. Teleflex
Inc.,
Often, it will be necessary for a court to look to interrelated
teachings of multiple patents; the effects of demands known to
the design community or present in the marketplace; and the
background knowledge possessed by a person having ordinary
skill in the art, all in order to determine whether there was an
apparent reason to combine the known elements in the fashion
claimed by the patent at issue. To facilitate review, this analysis
should be made explicit.
550 U.S. 398, 418 (2007) (citing In re Kahn, 441 F.3d 977, 988 (Fed. Cir.
2006) (“[R]ejections on obviousness grounds cannot be sustained by mere
conclusory statements; instead, there must be some articulated reasoning
with some rational underpinning to support the legal conclusion of
obviousness.”)).
“Whether an ordinarily skilled artisan would have been motivated to
modify the teachings of a reference is a question of fact.” WBIP, LLC v.
Kohler Co., 829 F.3d 1317, 1327 (Fed. Cir. 2016) (citations omitted).
“[W]here a party argues a skilled artisan would have been motivated to
combine references, it must show the artisan ‘would have had a reasonable
expectation of success from doing so.’” Arctic Cat Inc. v. Bombardier
Recreational Prods. Inc., 876 F.3d 1350, 1360–61 (Fed. Cir. 2017) (quoting
In re Cyclobenzaprine Hydrochloride Extended-Release Capsule Patent
Litig., 676 F.3d 1063, 1068–69 (Fed. Cir. 2012)).
D. Alleged Obviousness of Claims 1–24 over Chen, Lindahl, and
Hurst
Petitioner contends that claims 1–24 would have been obvious over
the combination of Chen, Lindahl, and Hurst. Pet. 17–83. We begin with
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brief discussions of the cited references, consider Petitioner’s proffered
motivation to combine those references, and then Patent Owner’s arguments
asserting that one of ordinary skill in the art would not have been motivated
or able to modify Chen to implement the partial frame encryption of
Lindahl.
Chen
Chen is directed to enhanced block-request streaming using scalable
encoding, which provides for improvements in the user experience and
bandwidth efficiency. Ex. 1006, codes (54), (57). Chen details that video
may be “encoded at multiple bitrates to form different versions, or
representations,” and those representations are broken into smaller pieces,
“perhaps on the order of a few seconds each, to form segments,” with each
segment stored as a separate file. Id. ¶ 63. As a client device requests
segments, it “switch[es] to different data rates based on available
bandwidth,” such that the client device may request multiple representations,
each presenting a different media component. Id. ¶ 64. Chen also discloses
that a media presentation description (“MPD”) is used, which “describe[s] a
media presentation that is a structured collection of segments, each
containing media components such that the client can present the included
media in a synchronized manner and can provide advanced features, such as
seeking, switching bitrates and joint presentation of media components in
different representations.” Id. ¶ 66. Figure 5 of Chen is reproduced below:

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Figure 5 of Chen provides possible structures of the content store with
segments and MPD files, also illustrating a breakdown of segments, timing,
and other structures in exemplary MPD file. Id. ¶ 216.

Chen also details that:
The media presentation may be constructed to permit
access by terminals with different capabilities, such as access to
different access network types, different current network
conditions, display sizes, access bitrates and codec support. The
client may then extract the appropriate information to provide the
streaming service to the user.
Ex. 1006 ¶ 68.
Lindahl
Lindahl is directed to partial encryption techniques for media data,
providing that partially encrypted media files allow for decryption to be
faster and less resource intensive. Ex. 1007, code (57), ¶ 95. Lindahl
discloses that each block of a media file is encrypted in accordance with the
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encryption parameters, and the process may utilize “one or more encryption
keys when encrypting each block.” Id. ¶ 54. Figures 5A–5C and 6A–6B of
Lindahl are reproduced below:

Figures 5A–5C and 6A–6B of Lindahl illustrate examples of the media file
encryption process. Id. ¶¶ 55–58.
Lindahl discloses that media file 500 includes frames F1, F2, etc.,
with each frame having header information and media data. Ex. 1007 ¶ 55.
Representative media frame 520, shown in Figure 5B, is divided into blocks,
B1, B2, B3, of the same size, as well as partial block PB. Id. In
representative block 540, shown in Figure 5C, only portion 542 is encrypted,
with the remainder being unencrypted. Id. Partially encrypted block 600
has initial unencrypted portion 602, followed by encrypted portion 604, and
followed by unencrypted portion 606. Id. ¶ 57, Fig. 6A. In another
embodiment, partially encrypted block 620 includes encrypted portions 624
and 628, and unencrypted portions 622, 626, and 630, with the portions
having lengths X, Y1, Z1, Y2, and Z2, measured in a number of bits or
bytes. Id. ¶ 58, Fig. 6B.
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Lindahl’s system allows for client machines to access a media server
to browse, select, download, and play purchased media files, where
encryption processes impose limitations on access to those files. Ex. 1007
¶ 40. Lindahl also discloses that a user may “receive a global key or other
cryptographic key when a media file is purchased.” Id. ¶ 64. Lindahl
further discloses that the download of the media file “can be performed by
streaming the media file through the data network to the user.” Id. ¶ 65.
Lindahl also discloses that “[a]ny cryptographic keys being used with
respect to the encrypted media file are also stored in the client machine.” Id.
¶ 66.
Hurst
Hurst is directed to the maintenance of a programming lineup of
adaptive-bitrate content streaming, using a timeline module and a plurality
of streamlets. Ex. 1008, code (57). Figures 2b, 3a, and 3b of Hurst are
reproduced below.

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Figures 2b, 3a, and 3b of Hurst illustrates a plurality of streams divided into
a plurality of source streamlets. Id. at 6:46–7:8, 7:9–20.
Figure 2b illustrates plurality of streams 202 having varying degrees
of quality and bandwidth, with low quality, medium quality, and high
quality streams 204, 206, and 208, respectively, containing encoded
representations of a content file encoded and compressed to varying bitrates.
Ex. 1008, 6:46–53. Figure 3a illustrates stream 302 divided into a plurality
of source streamlets 303, each encapsulated as an independent media object.
Id. at 6:59–64. Figure 3b illustrates sets of streamlets 304, having identical
time indices and durations but varying bitrates, such that set 306a includes
encoded streamlets 304 having low 204, medium 206, and high 208 bitrates.
Id. at 7:9–16. Hurst also discloses that its system uses a digital rights
management (“DRM”) server that is configured to maintain keys used to
decrypt content and determine whether a client device is allowed to access
content. Id. at 18:62–64. Hurst further discloses that the streamlets may be
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encrypted with the same key or may be configured to encrypt each bit rate
with a different set of encryption keys. Id. at 18:66–19:2.
Petitioner’s Proffered Motivation to Combine the References
Petitioner argues that a person of ordinary skill in the art would have
been motivated to combine the teachings of Lindahl and Hurst with Chen,
such that the DRM processes, including partial encryption and key
management, of Lindahl and Hurst, would have been employed in Chen’s
adaptive streaming system. Pet. 17. Petitioner asserts that such technologies
were commonly used together and were recognized as complementary, and
would have been combined for their known and conventional purposes. Id.
(citing Ex. 1003 ¶ 114). Petitioner also asserts that it was “widely known for
video streaming to include these features to account for bandwidth
variability over the Internet and address piracy.” Id. (citing Ex. 1010,
Abstract; Ex. 1006 ¶¶ 103–104; Ex. 1007 ¶¶ 36, 39; Ex. 1008, 3:12–23, 6:6–
58).
Petitioner acknowledges that although Chen discloses DRM (Ex. 1006
¶ 522), it does not disclose any particular implementation. Pet. 18.
According to Petitioner, one of ordinary skill in the art would have used
Lindahl and Hurst to supplement Chen’s DRM requirements. Id. Petitioner
asserts that Lindahl prevented unauthorized access to media while improving
computational efficiency through its partial encryption teachings that would
have been “well-suited for video streaming applications,” and its key
management teachings “provided security, simplicity and efficiency
benefits.” Id. (citing Ex. 1003 ¶¶ 115, 119–122; Ex. 1007 ¶ 95). Petitioner
further asserts that Hurst discloses that alternative streams are encoded at
different bitrates and encrypted as a group in the same manner, such as by
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using the same key, and thus providing a natural and obvious approach to
DRM for adaptive streaming. Id. at 19 (citing Ex. 1006 ¶¶ 63–64; Ex. 1003
¶ 116). Petitioner argues that one of ordinary skill in the art would have
been motivated to apply teachings of Lindahl and Hurst to Chen to address
piracy concerns, improve the efficiency of adaptive streaming, optimize the
balance between bitrate and bandwidth, and improve the end-user
experience with fast startup and seek. Id. at 18–19. Petitioner also asserts
that ordinarily skilled artisans would have had a reasonable expectation of
success in combining the teachings of Chen, Lindahl, and Hurst because
“they were widely known in the art and widely recognized as
complementary and compatible techniques that were intended to be used
together, and which a [person of ordinary skill in the art] would have been
familiar with.” Id. at 21 (citing Ex. 1003 ¶ 126).
Patent Owner’s Arguments Countering Motivation to Combine
the References, Petitioner’s Responses, and Our Analysis
Patent Owner asserts that Petitioner has failed to demonstrate that a
person of ordinary skill in the art would have been motivated to combine the
references as proposed by Petitioner because Petitioner’s arguments are
conclusory, not supported by sufficient evidence, and Petitioner has not
demonstrated “that its proffered goals would be better achieved through its
combination over Chen’s existing system.” PO Resp. 2–3. Patent Owner
also argues that aspects of Chen’s system are incompatible with partial
frame encryption, or at least beyond the capability of ordinarily skilled
artisans to ensure a reasonable likelihood of success, and that the proposed
modifications of Chen would actually deteriorate the efficiency of its
system, negating Petitioner’s proffered goal in its stated reason to combine
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the references. Id. at 3. We address Patent Owner’s motivational arguments
below and then address the compatibility arguments thereafter.
Patent Owner begins by arguing that Petitioner’s purported motivation
for combining the references “is not supported by any cognizable evidence,”
and the unexplained citations to its expert’s declaration cannot be relied
upon. PO Resp. 4 (citing Consolidated Trial Practice Guide (Nov. 2019),
35–36; Cisco Sys., Inc. v. C-Cation Techs., LLC, IPR2014-00454, Paper 12
at 9–10 (PTAB Aug. 29, 2014) (informative)) (emphasis omitted). Patent
Owner also argues that “[b]ecause Petitioner’s motivation is not supported
by any evidence, it fails as a matter of law.” Id. at 5 (citing In re Magnum
Oil Tools Int’l, Ltd., 829 F.3d 1364, 1380 (Fed. Cir. 2016)). Petitioner
responds that the Petition provides “ample motivation to combine,” and that
Patent Owner is misrepresenting the Petition’s analysis by ascribing it to a
single sentence. Pet. Reply 3–4. On this point, we agree with Petitioner.
Reasonable expectation of success and motivation to combine are
different legal concepts. See, e.g., Intelligent Bio-Sys., Inc. v. Illumina
Cambridge Ltd., 821 F.3d 1359, 1365–69 (Fed. Cir. 2016). Although we
continue to determine that Petitioner has sufficiently established that an
ordinarily skilled artisan would have had some motivation to combine the
teachings of Chen, Lindahl, and Hurst, see Dec. 16, we determine below that
Petitioner’s obviousness showing does not sufficiently demonstrate that one
of ordinary skill in the art would have had a reasonable expectation of
success, in view of all of the disclosure and teachings of Chen and Lindahl.
As Petitioner points out, beyond the exemplary sentence on which
Patent Owner’s argument focuses, the Petition provides preceding and
subsequent paragraphs regarding the reason for combining Chen, Lindahl,
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and Hurst, i.e., more than “to address privacy concerns and improve
efficiency.” See Pet. 17–22. Petitioner discusses express motivations in the
secondary references, as well as benefits found in those secondary
references, and applies those as a reason to combine elements of the
systems. Id. Additionally, we are not persuaded that the Petition’s citations
to Dr. McDaniel’s testimony (Ex. 1003 ¶¶ 114–116, 119–120, 126) in the
Petition were “unexplained,” and we find that testimony beneficial in
considering the proffered motivation to combine Chen, Lindahl, and Hurst.
Patent Owner next argues that Petitioner’s proffered motivation is
made with the assumption that Chen “did not require any particular DRM
implementation.” PO Resp. 6 (quoting Pet. 18). Patent Owner counters that
Chen discloses fragment-level encryption, such that a person of ordinary
skill in the art would have understood that the entire fragment or block is
encrypted as a singular unit. Id. (citing Ex. 1006 ¶ 522; Ex. 2012 ¶¶ 49–50).
Patent Owner distinguishes such encryption from frame or partial-frame
encryption, such as disclosed in Lindahl, with encrypted fragments in Chen
encompassing between 12 and 30 frames. Id. at 6–8 (citing Ex. 2013,
108:5–9, 106:21–107:3; Ex. 1006 ¶ 66, Fig. 9(a); Ex. 2012 ¶¶ 52–53).
Patent Owner argues that Petitioner does not identify any fault in Chen’s
existing system, or show that replacing those aspects with Lindahl’s partial
frame encryption method would address piracy or improve efficiency when
compared to Chen’s existing system. Id. at 8–9 (citing Kinetic Concepts,
Inc. v. Smith & Nephew, Inc., 688 F.3d 1342, 1369 (Fed. Cir. 2012); Nichia
Corp. v. Everlight Ams., Inc., 855 F.3d 1328, 1339 (Fed. Cir. 2017), cert.
denied, 139 S. Ct. 183 (2018)).
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Petitioner counters that Patent Owner has misrepresented Chen’s
encryption discussion, arguing that paragraph 522 of Chen concerns a
“hypothetical exercise that Chen uses ‘to simplify the discussion’ for
concurrent HTTP/TCP requests.” Pet. Reply 11. Petitioner argues that it
would be improper to limit Chen to an embodiment, especially one that is a
hypothetical or optional embodiment. Id. at 12. Petitioner also argues that
“it would be improper under Federal Circuit case law to require proof that
Lindahl’s partial encryption is superior to other known encryption
techniques.” Id. at 8 (citing Novartis Pharm. Corp. v. W.-Ward Pharm. Int’l
Ltd., 923 F.3d 1051, 1059 (Fed. Cir. 2019)). We agree with Patent Owner
on this issue.
As Patent Owner notes, the Petition states that Chen “did not require
any particular DRM implementation.” PO Resp. 6 (quoting Pet. 18).
Although factually true, with respect to requirements, Petitioner’s statement
suggests that Chen is agnostic with respect to encryption, such that it would
“leav[e] particulars to the POSITA’s knowledge and preferences.” Pet. 18
(citing Ex. 1003 ¶ 115). As Patent Owner points out, however, Chen does
discuss at least one type of encryption regime, so that a particular type of
encryption, i.e., fragment-level encryption, would presumably have
relevance to ordinarily skilled artisans reviewing Chen. “The use of patents
as references is not limited to what the patentees describe as their own
inventions or to the problems with which they are concerned. They are part
of the literature of the art, relevant for all they contain.” In re Heck, 699
F.2d 1331, 1332–33 (Fed. Cir. 1983) (quoting In re Lemelson, 397 F.2d
1006, 1009 (CCPA 1968)). Given that Chen discusses at least one particular
type of encryption, we are not persuaded that one of ordinary skill in the art
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would forget its disclosure and consider any type of DRM, without evidence
of something more in Chen or the prior art that would counsel DRM
generally. As such, the fragment-level encryption discussed in Chen would
inform ordinarily skilled artisans about the types of techniques that Chen
would deem to be applicable to implement. Thus, although discussed with
respect to a single embodiment, the types of DRM envisioned by the
inventors in Chen would have had a bearing on the types of encryption or
protection that one of ordinary skill in the art would have sought to
incorporate into Chen. Therefore, while Chen cannot be said to be
incompatible to frame or partial-frame encryption, the types of protection
identified by Chen have relevance.
Patent Owner also argues that Chen improves its latency, user
experience, and efficiency through features that are incompatible with partial
frame encryption. PO Resp. 9–13. Patent Owner continues that those
features in Chen are “integral parts of its system,” with independent
scalability layers and Forward Error Correction (“FEC”) being necessary to
allow for Chen’s performance, to minimize latency and to improve
efficiency. Id. at 11–12 (citing Ex. 2012 ¶¶ 55–61).
Petitioner responds that the aspects of scalability and FEC in Chen are
“optional” and not integral to its system. Pet. Reply 5, 7. Petitioner argues
that Chen provides that “scalable layers” are used “[i]n some embodiments,”
and that Chen provides for the simplest case where “alternative
representations” are stored as separate streams, rather than enhancements of
each other used together as scalable layers. Id. at 9 (citing Ex. 1006 ¶¶ 27,
70). Patent Owner responds that the title of Chen is “Enhanced Block-
Request Streaming Using Scalable Encoding” and that “scalable blocks” are
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“necessary.” PO Sur-reply 8–9 (citing Ex. 1006 ¶¶ 27, 375, 379, code (54);
Ex. 2012 ¶¶ 55–62) (emphasis omitted). We agree with Patent Owner in this
regard.
As Patent Owner points out, in Chen, the sentence that precedes the
phrase quoted in Petitioner’s Reply about scalable layers being only in some
embodiments is: “Chen’s ‘system is configured to provide and consume
scalable blocks.’” PO Sur-reply 9 (quoting Ex. 1006 ¶ 27) (emphasis
omitted). We also find the testimony of Dr. Nielson on this point to be
persuasive, i.e., that scalability layers are an integral part of Chen’s system,
and, as Patent Owner indicates, that testimony is unrebutted by testimony
from Dr. McDaniel.5 Id. We further agree with Patent Owner that Petitioner
has not pointed to a single embodiment of Chen that does not utilize
scalability. Id. at 10. We, therefore, do not agree with Petitioner that
scalable layers are an optional “feature” of Chen.
Even if we accept Petitioner’s assertion that Chen’s statement that “a
viable system need not include all of the features described herein” (Pet.
Reply 11 (citing Ex. 1006 ¶¶ 62, 139) (emphasis omitted)), and that one of
ordinary skill in the art could have relied on Chen’s “simplest case,” such
artisans would have still been informed about the use of scalable blocks and
their benefits. And even if Petitioner is correct that ordinarily skilled
artisans could have implemented aspects of Chen without its central features,
Petitioner has not demonstrated why they would jettison features that are
disclosed as useful.

5 We note that Petitioner filed a supplemental Declaration by Dr. McDaniel
(Ex. 1031), but it did not address the nature of scalability layers in Chen.
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Similarly, Petitioner argues that the FEC aspects of Chen are also
optional and that the embodiment highlighted by Patent Owner is exemplary
but not required, as Chen provides that “[t]here are many variations of the
[n]o-FEC method and the FEC method.” Pet. Reply 9–10 (quoting Ex. 1006
¶ 534; citing Ex. 1006 ¶¶ 529–533). In response, Patent Owner argues that
Chen discloses the non-FEC method to show why Chen believed its FEC
method is superior. PO Sur-reply 106 (citing Ex. 1006 ¶ 530). Additionally,
Petitioner argues that even if the “optional features were integral to Chen’s
invention (they are not),” the Petition relies on Chen’s more general
teachings, such that one of ordinary skill in the art would have been able to
use Chen’s known streaming techniques without the “optional
embodiments.” Pet. Reply 5.
We need not determine whether FEC processes are “integral” to
Chen’s system. Both parties acknowledge the disclosure of such FEC
processes in Chen, and one of ordinary skill in the art would have considered
them in the context of Chen’s overall disclosure. A reference may be relied
upon for all that it would have reasonably suggested to one having ordinary
skill the art, including nonpreferred embodiments. Merck & Co. v. Biocraft
Labs., 874 F.2d 804 (Fed. Cir. 1989), cert. denied, 493 U.S. 975 (1989).
Persons of ordinary skill in the art would have considered all of Chen;
Petitioner’s assertions that the Petition need consider only the very basic
adaptive bitrate streaming aspects do not divorce the additionally disclosed
aspects from influencing whether ordinarily skilled artisans would have

6 We have not considered Patent Owner’s Sur-reply arguments (on page 10)
that rely on Exhibit 2025, which we discuss below with respect to
Petitioner’s Motion to Exclude.
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adopted aspects of a secondary reference, like Lindahl. Contrary to
Petitioner’s assertions, we do not find that one of ordinary skill in the art
“would no longer be able to use known streaming techniques without Chen’s
optional features” (Pet. Reply 5–6), but rather determine that those
additional embodiments or features cannot be ignored in considering
whether one of ordinary skill in the art would have had a reasonable
expectation of success in the combination.
Petitioner also alleges that Patent Owner’s argument that Lindahl’s
partial encryption cannot be incorporated into Chen’s system due to
incompatibilities with optional embodiments “engages in textbook bodily
incorporation,” which is irrelevant to obviousness. Pet. Reply 6. Again,
however, it does not require bodily incorporation to consider all aspects of a
reference’s disclosure. Even a purely optional aspect of Chen could retard
the likelihood that one of ordinary skill in the art would incorporate other
aspects from Lindahl, where it is Petitioner’s burden to argue and supply
evidence that the combination would have had a reasonable expectation of
success, even in view of the optional aspect. See Intelligent Bio-Sys., 821
F.3d at 1367 (“It was [Petitioner’s] burden to demonstrate both that a skilled
artisan would have been motivated to combine the teachings of the prior art
references to achieve the claimed invention, and that the skilled artisan
would have had a reasonable expectation of success in doing so.” (citations
and quotations omitted)).
Patent Owner also argues that implementing partial frame encryption
together with independent scalable layers and forward error correction
would have presented potentially insurmountable challenges beyond the
skills of ordinary artisans. PO Resp. 13–18. Patent Owner cites to
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testimony of Dr. Nielson, which details that the use of multiple scalable
layers could compromise the encryption, in that it could allow a client with
no encryption key to consume the encrypted portions of a media file. Id. at
13–15 (citing Ex. 2012 ¶¶ 64–66). Patent Owner also cites to additional
testimony of Dr. Nielson, which details that implementing partial frame
encryption in connection with FEC in Chen could allow for unencrypted
portions being used to decrypt encrypted portions. Id. at 15–17 (citing
Ex. 2012 ¶¶ 68–70).
Petitioner replies that Patent Owner’s argument “assumes, contrary to
known best practices, that FEC was applied before encryption and thus
reveals information about unencrypted data,” which was not how FEC was
used in the art. Pet. Reply 12 (citing Ex. 1031 ¶¶ 10–12). Petitioner also
casts doubt on Dr. Nielson’s testimony that scalable layers could
compromise the encryption, and other aspects related to scalability and full
and partial encryption. Id. at 13–15 (citing Ex. 1024, 13:23–14:8, 17:22–
18:10, 49:2–15, 52:17–53:13, 55:16–56:7; Ex. 1029, 64:21–65:4, 67:8–16,
72:18–24, 81:2–11, 91:15–92:16, 135:8–21, 155:2–8, 161:18–162:16,
176:22–177:22, 178:9–16, 180:5–181:19, 181:21–182:8, 186:24–187:24).
Petitioner also cites to an additional prior art reference (Ex. 1030) for its
teaching that partial frame encryption with layered video is possible. Id. at
14–15 (citing Ex. 1030, 3:35–42, 21:24–29, 23:36–24:18).
Patent Owner replies that Petitioner’s new evidence is untimely and is
unaccompanied by any expert testimony. PO Sur-reply 11. Patent Owner
also argues that “Dr. Nielson’s testimony that implementing partial frame
encryption with Scalable Video Coding (SVC) would have been beyond a
POSITA’s skills” is unrebutted. Id. at 12 (citing Ex. 2012 ¶¶ 63–67). With
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respect to the additional prior art reference, Patent Owner argues that it does
not disclose that the use of layers and partial frame encryption occur in the
same embodiments, that the same implementations could occur in Chen’s
different system, and that it does not demonstrate that one of ordinary skill
in the art would have had a reasonable expectation of success in view of the
challenges established. Id. at 12–13 (citing Ex. 2012 ¶ 67; Ex. 1030, 23:9–
10; 23:37–38). With respect to Petitioner’s assertions about Dr. Nielson’s
testimony, Patent Owner cites to Dr. Nielson’s decades of expertise and
experience in encryption and security as an industry consultant and professor
at The University of Texas at Austin. Id. at 13–14 (citing Ex. 2012 ¶¶ 7–30;
Ex. 1029, 24:4–27:22, 30:19–33:22).
Dr. McDaniel’s new testimony (Ex. 1031) on use of FEC with partial
frame encryption raises many issues, but ultimately is not persuasive. His
testimony points out several potential issues with Dr. Nielson’s arguments
and conclusions (Ex. 1031 ¶¶ 10–12), but ultimately demonstrates the
unpredictability of combining FEC with partial frame encryption. Both
experts make credible arguments, but we need not resolve every argument to
understand that there would have been a significant level of uncertainty in
applying partial frame encryption to Chen’s system with its disclosed
scalable layers and FEC processes. Taking the testimony of both experts,
we determine that there would have been significant doubt, by one of
ordinary skill in the art, that Lindahl’s partial frame encryption could be
incorporated into Chen’s disclosed system. That doubt directly contributes
to our determination that Petitioner has not established that an ordinarily
skilled artisan would have had a reasonable expectation of success in
combining the cited aspects of Lindahl into Chen’s system.
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Further to that latter point, Patent Owner also argues that a person of
ordinary skill in the art would not have been motivated to combine Chen and
Lindahl without many of the disclosed features of Chen because that would
have reduced efficiency, rather than improve it, per Petitioner’s proffered
rationale. PO Resp. 18–22. Patent Owner additionally argues that Petitioner
has not demonstrated partial frame encryption, per Lindahl, would provide
better protection than Chen’s disclosed fragment level encryption. Id. at 19.
Patent Owner also argues that eliminating independent scalable layers and
FEC, in order to utilize partial frame encryption, would deteriorate Chen’s
performance and reduce its efficiency. Id. at 19–22 (citing Ex. 2012 ¶¶ 73–
76). We agree with Patent Owner that these additional factors weigh against
one of ordinary skill in the art making the combination with a reasonable
expectation of success, as laid out in the Petition, namely integrating partial
frame encryption aspects of Lindahl, into Chen’s system that may utilize
scalable layers and FEC processes.
Lastly, Patent Owner argues that the need to modify standard file
formats would further counsel one of ordinary skill in the art against
combining the references or doing so with a reasonable expectation of
success. PO Resp. 22–24. Patent Owner argues that it is undisputed that to
even attempt implementing partial frame encryption in Chen, it was required
to implement modifications to the standard file formats utilized by Chen,
citing deposition testimony of Dr. McDaniel. Id. at 23 (citing Ex. 2013,
35:25–36:12, 25:7–18, 34:11–14). Patent Owner argues that “it was beyond
the skills of a POSITA to modify the standard file formats to implement
partial frame encryption information within the file.” Id. at 24 (citing
Ex. 2012 ¶¶ 78–82, 71).
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On this last point, Petitioner argues that a person of ordinary skill in
the art would have had a reasonable expectation of success because Lindahl
expressly discloses that partial encryption can be applied to popular file
formats, such as the MPEG-4 format. Pet. Reply 15–16 (citing Ex. 1010,
3:2–6, 4:14–15, 5:63–6:9; Ex. 1007 ¶ 67; Ex. 1031 ¶¶ 3–4). Petitioner also
argues that a person of ordinary skill in the art would have been able to use
the MP4 and 3GPP file formats, where those formats include the ability to
extend them because their architectures were extensible by design. Id. at 16
(citing Ex. 1031 ¶ 5). Petitioner also argues that “[t]he prior art is replete
with explicit teachings to extend the 3GP, MP4, and other standard file
formats, and a POSITA would not have found it technically challenging to
do so.” Id. at 19 (citing Ex. 2013, 27:9–20; Ex. 1031 ¶ 9).
We determine that we need not decide whether persons of ordinary
skill in the art could and would have modified existing file formats to
accomplish the goal of partial frame encryption. Both parties acknowledge
that some types of modifications would be necessary to standard file formats
in any resulting system of Chen and Lindahl. As Patent Owner points out,
the stipulated person of ordinary skill in the art would know how to use
standard file formats, but not necessarily be able to modify standard file
formats. PO Sur-reply 22; see Section II.A. The requirement to modify
standard file formats casts significant doubt on the efficacy of combining
aspects of Lindahl into Chen’s system, also considering the potential loss of
interoperability with other devices, as pointed out by Patent Owner. PO Sur-
reply 22. That doubt further contributes to our determination that Petitioner
has not established an ordinarily skilled artisan would have had a reasonable
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expectation of success in combining the cited aspects of Lindahl into Chen’s
system.
Overall, taking into account the disclosed DRM methods in Chen, the
aspects of independent scalability layers and FEC disclosed by Chen, the
challenges of incorporating Lindahl’s partial frame encryption into a system
like Chen’s with its preferred structures for efficiency, and the need to
modify standard file formats, we are not persuaded that one of ordinary skill
in the art would have had a reasonable expectation of success in combining
Chen, Lindahl, and Hurst to arrive at a system that renders claims 1–24
obvious.
Summary
We determine that Petitioner has not shown by a preponderance of
evidence that claims 1–24 would have been obvious over Chen, Lindahl, and
Hurst.
III. PETITIONER’S MOTION TO EXCLUDE
Petitioner filed a motion (Paper 42, “Mot.”) to exclude Exhibits 2016–
2021 and 2025, as well as paragraphs 54–82 of Exhibit 2012. Mot. 1.
Patent Owner filed an Opposition to Petitioner’s Motion (Paper 44, “Opp.”),
and Petitioner filed a Reply in support of its Motion (Paper 45, “Reply”).
Petitioner, as the “moving party,” “has the burden of proof to establish that it
is entitled to the requested relief.” 37 C.F.R. § 42.20.
A. Exhibit 2012
With respect to Exhibit 2012, Dr. Nielson’s declaration, Petitioner
asserts that paragraphs 54–82 should be excluded because they are
conclusory and apply the wrong legal standard. Mot. 2–4. The cited
paragraphs of Dr. Nielson’s declaration discuss how Chen improves its
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latency, user experience and efficiency through features that are
incompatible, or beyond the skills of a person of ordinary skill in the art to
implement, with partial frame encryption. See Ex. 2012 ¶¶ 54–82.
Petitioner asserts that Dr. Nielson did not consider the prior art and did not
apply a presumption that a person of ordinary skill in the art is presumed to
be aware of all pertinent prior art. Id. Also with respect to Exhibit 2012,
Petitioner asserts that paragraphs 54–77 should be excluded because Dr.
Nielson’s testimony lacks a sufficient factual basis and he failed to disclose
the underlying facts and data used to form his opinions. Id. at 4–7.
Petitioner asserts that Dr. Nielson does not consider video encoding to be
one of his areas of expertise and indicated that he may have looked up
materials to provide his opinions, but was unable to identify the materials
that form the basis for his opinions. Id.
Patent Owner responds, with respect to Exhibit 2012, that the motion
to exclude should be rejected “because it relates to the weight of the
evidence, not its admissibility.” Opp. 1. Patent Owner also argues that
Petitioner’s argument that Dr. Nielson did not consider Exhibit 1016 is
unavailing because “the AVI file format is not one of the file formats
disclosed as compatible with” Chen. Id. Additionally, Patent Owner argues
that “video encoding” is not included in the stipulated-to definition of a
person of ordinary skill in the art, and that Petitioner failed to query Dr.
Nielson about his areas of expertise. Id. at 2–3.
In reply, Petitioner contends that “[t]he problem is that Dr. Nielson
formed his opinions on file formats – a subject in which he does not consider
himself an expert – without looking to any prior art on file formats.”
Reply 1. As such, Petitioner asserts that Dr. Nielson “applied the wrong
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legal standard for his opinions on file formats.” Id. Petitioner also argues
that Dr. Nielson “cites no factual basis for his scalable video opinions but
relied on materials that he could not identify.” Id. at 2.
With respect to Exhibit 2012, we agree with Patent Owner that the
objection to the specific portions of Dr. Nielson’s declaration, namely
paragraphs 54–82, relate to the proper weight to give to his testimony and
not to its admissibility. Expert witnesses may testify as to hypothetical
scenarios and may base opinion on information from others, with any flaws
in data or factual assumptions going to the weight of the evidence, not
admissibility. Summit 6, LLC v. Samsung Elecs. Co., 802 F.3d 1283, 1298
(Fed. Cir. 2015); see also Corning Inc. v. DSM IP Assets B.V., IPR2013-
00053, Paper 66 at 19 (PTAB May 1, 2014) (“[T]he Board, sitting as a non-
jury tribunal . . . is well-positioned to determine and assign appropriate
weight to the evidence presented in this trial.”). In this case, the fact that
Dr. Nielson may have applied a different presumption of what one of
ordinary skill in the art would have considered would affect the proper
weight to give his testimony, not its admissibility. We agree with Patent
Owner to the extent that Dr. Nielson explained as follows: “[M]y analysis of
the POSITA in my Declaration is correct based on my knowledge of
POSITA at that time. I don’t think that [Ex. 1016], even if they were aware
of it, would necessarily change my opinion.” Opp. 2 (second alteration in
original) (quoting Ex. 1029, 229:4–9). Assuming, as Petitioner argues, that
this is the wrong standard to be applied, it would still go to the weight that
should be accorded such testimony and not whether it should be excluded.
For these reasons, we deny Petitioner’s motion to exclude paragraphs 54–82
of Exhibit 2012.
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B. Exhibits 2016–2021
With respect to Exhibits 2016–2021, Petitioner asserts that
Exhibits 2016–2020 have not been authenticated, that several are webpages
that may be unreliable, and that a declaration by Patent Owner’s counsel
(Ex. 2021) attempting to authenticate these exhibits is not based on first-
hand knowledge and relies on hearsay statements. Mot. 7–10. Petitioner
also asserts that Exhibits 2016–2020 contain inadmissible hearsay and lack
relevance. Id. at 10–11. Petitioner further asserts that statements in
Exhibits 2016–2021 “contain impermissible opinion testimony that is not
rationally based on the witness’s perception or personal knowledge of the
matter and instead is based on scientific, technical, or other specialized
knowledge.” Id. at 11–12.
Patent Owner responds, with respect to Exhibits 2016–2020, that the
exhibits are admissible as evidence relied upon by Patent Owner’s expert,
irrespective of objections to the exhibits themselves. Opp. 4. Patent Owner
notes that “Petitioner does not attempt to exclude Dr. Nielson’s testimony
relying on these exhibits,” and thus “has forfeited any argument that he is
relying improperly on these [e]xhibits.” Id. (citing Mot. 2–7). Patent Owner
also argues that these exhibits are authenticated and are self-authenticating,
are not inadmissible hearsay, and are not offered as opinion testimony. Id. at
5–12. In reply, Petitioner contends that those exhibits have not been
authenticated, are not self-authenticating, and are hearsay. Reply 2–3.
As noted by Patent Owner, Petitioner does not challenge Dr. Nielson’s
testimony based on these exhibits. Nor does Petitioner argue that it was
unreasonable for Dr. Nielson to rely upon these exhibits, even if the exhibits
are inadmissible. Thus, even if we were to exclude the exhibits,
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Dr. Nielson’s testimony thereon is still before us for consideration. See Wi-
Lan Inc. v. Sharp Elecs. Corp., 992 F.3d 1366, 1375–76 (Fed. Cir. 2021)
(discussing admissibility of expert testimony based on inadmissible
evidence). Although we do not explicitly rely on each of the challenged
exhibits, we do rely upon Dr. Nielson’s testimony. Therefore, for our
purposes, there is no substantive difference whether we exclude these
exhibits and consider Dr. Nielson’s testimony as compared to whether we do
not exclude these exhibits while considering Dr. Nielson’s testimony.
Accordingly, because Dr. Nielson’s testimony relying on Exhibits 2016–
2020 is unchallenged, Petitioner’s motion to exclude these exhibits is
dismissed as moot. We, therefore, also determine that Petitioner’s motion to
exclude Exhibit 2021, a declaration by Patent Owner’s counsel regarding
these exhibits, is moot and thus, dismissed.
C. Exhibit 2025
With respect to Exhibit 2025, Petitioner asserts that it constitutes new
evidence prohibited for Sur-reply under 37 C.F.R. § 42.23(b). Mot. 12–13.
Petitioner also requests that portions of the Sur-reply that rely on the
improper new evidence be stricken. Id. at 13. We note that Patent Owner’s
Sur-reply explicitly cites to Exhibit 2025 only on pages 10 and 15 thereof.
Additionally, Petitioner argues that Exhibit 2025 should be excluded
because it has not been authenticated, contains inadmissible hearsay, lacks
relevance, and contains improper opinion. Id. at 13–15.
Patent Owner responds that Exhibit 2025 “was introduced and used
during deposition of Petitioner’s expert.” Opp. 12 (citing Ex. 2026, 21:9–
26:14). Patent Owner contends that “‘transcripts’ include exhibits to the
deposition.” Id. (citing Federal Rule of Civil Procedure (“Fed. R. of Civ.
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P.”) 30(f)(2)). Patent Owner also contends that Petitioner incorrectly claims
that “it was deprived of the opportunity to ‘present competing evidence,
direct testimony,’” because Petitioner was able to present testimony during
the deposition of Petitioner’s own expert, but chose not to do so. Id. at 13
(quoting Mot. 13). Patent Owner also contends that Exhibit 2025 is
authenticated, is not inadmissible hearsay, and is not offered as opinion
testimony. Id. at 13–15.
In reply, Petitioner contends that Fed. R. of Civ. P. 30(f)(2), upon
which Patent Owner relies, “only applies ‘on a party’s request’” to have
documents attached, and no such request was made. Reply 3. Petitioner
also contends that the Federal Rules of Evidence and not Civil Procedure
apply to PTAB proceedings and that Exhibit 2025 was filed as a separate
exhibit from the transcript (Ex. 2026). Id. Petitioner reiterates that 37
C.F.R. § 42.23(b) “prohibit[s] new evidence on Sur-reply, other than the
deposition transcript itself,” and is prejudicial because Petitioner had no
opportunity to address Patent Owner’s mischaracterizations. Id. at 3–4.
Petitioner also asserts that Exhibit 2025 was not served before the deposition
itself, such that on-the-fly redirect does not satisfy the need for an
opportunity to properly evaluate the exhibit. Id. at 4–5. Petitioner also
asserts that it objected during the deposition and subsequently upon service.
Id. at 5 (citing Ex. 2026, 22:8–10; Paper 41).
We note that 37 C.F.R. § 42.23(b) specifies, in relevant part, that “[a]
Sur-reply may only respond to arguments raised in the corresponding reply
and may not be accompanied by new evidence other than deposition
transcripts of the cross-examination of any reply witness.” 37 C.F.R.
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§ 42.23(b). The Consolidated TPG repeats the above-quoted language of the
rule and also explains that
[s]ur-replies should only respond to arguments made in reply
briefs, comment on reply declaration testimony, or point to cross-
examination testimony. As noted above, a sur-reply may address
the institution decision if necessary to respond to the petitioner’s
reply. This sur-reply practice essentially replaces the previous
practice of filing observations on cross-examination testimony.
Consolidated TPG at 73–74. Accordingly, Rule 42.23(b) provides a blanket
prohibition on a patentee filing exhibits with a Sur-reply, as Patent Owner
has done here.
The next question for us, as presented by Patent Owner’s arguments,
is whether Petitioner was required to object to the exhibits under 37 C.F.R.
§ 42.64(a) during Dr. McDaniel’s second deposition. Rule 42.64 delineates
between two types of evidence—“Deposition evidence” and “Other
evidence.” Objections to the admissibility of deposition evidence must be
made during the deposition. 37 C.F.R. § 42.64(a). Notably, the Rule further
states that “[e]vidence to cure the objection must be provided during the
deposition, unless the parties to the deposition stipulate otherwise on the
deposition record.” Id. Objections to the admissibility of other evidence
(i.e., evidence other than deposition evidence) after trial has been instituted
must be filed within five business days of service of the evidence to which
the objection is directed. 37 C.F.R. § 42.64(b)(1). And, the Rule provides
that “[a] party relying on evidence to which an objection is timely served
may respond to the objection by serving supplemental evidence.” 37 C.F.R.
§ 42.64(b)(2).
In light of the procedures set forth above and the facts presented here,
it would not make sense to require Petitioner to raise an objection under
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Rule 42.23(b) during Dr. McDaniel’s second deposition. Specifically, this
portion of Rule 42.23(b) specifies what evidence may and may not
accompany a Sur-reply. Dr. McDaniel’s second deposition was held on
April 5, 2021 (Ex. 2026, 1), and Patent Owner filed Exhibit 2025 with its
Sur-reply on April 21, 2021. To find as Patent Owner requests, Petitioner
would be required to object to Patent Owner filing the exhibit before Patent
Owner actually filed the exhibit. That would not make sense. Accordingly,
we determine that Petitioner was not required to object to Patent Owner’s
filing before Patent Owner filed. Thus, the objection was not waived.
Additionally, we do not find it in the interests of justice to maintain
Exhibit 2025 in the case file. We disagree that the exhibit provides context
for Dr. McDaniel’s deposition testimony because Dr. McDaniel testified that
he had not prepared for the deposition using the document. See, e.g.,
Ex. 2026, 22:14–21 (testifying that he had probably seen Exhibit 2025
before but “it’s probably been decades”). Even though Petitioner filed
additional exhibits with its Reply along with a declaration from
Dr. McDaniel, Patent Owner had an opportunity to respond (with its Sur-
reply) and depose Dr. McDaniel (which Patent Owner did). In contrast,
Petitioner does not have an opportunity to respond to new evidence provided
with Patent Owner’s Sur-reply.
Further, we have not considered the portions of Patent Owner’s Sur-
reply on pages 10 and 15 that rely upon Exhibit 2025, as identified in
Paper 41 (Petitioner’s Objections to Patent Owner’s Evidence).
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Accordingly, we grant Petitioner’s Motion to Exclude with respect to
Exhibit 2025 pursuant to 37 C.F.R. § 42.23(b).7
IV. CONCLUSION
For the reasons discussed above, Petitioner has not demonstrated, by a
preponderance of the evidence, that claims 1–24 are unpatentable.
Additionally, we grant in part Petitioner’s Motion to Exclude and exclude
Exhibit 2025, as described above; deny Petitioner’s Motion to Exclude with
respect to Exhibit 2012; and dismiss as moot Petitioner’s Motion to Exclude
with respect to Exhibits 2016–2021.
Our conclusions regarding the Challenged Claims are summarized
below:

V. ORDER
For the reasons given, it is:
ORDERED that Petitioner has failed to establish based on a
preponderance of evidence that claims 1–24 of U.S. Patent No. 10,225,588
B2 are unpatentable as obvious under 35 U.S.C. § 103;

7 In light of our determination, we need not also decide whether this exhibit
(a) is properly authenticated, (b) contains inadmissible hearsay, or
(c) contains improper judicial opinions. See Mot. 13–15.
Claims
35
U.S.C.
§
Reference(s)/Basis
Claims
Shown
Unpatentable
Claims
Not Shown
Unpatentable
1–24 103 Chen, Lindahl,
Hurst
1–24
Overall
Outcome
1–24
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FURTHER ORDERED that Petitioner’s Motion to Exclude
(Paper 42) is granted in part with respect to Exhibit 2025, denied in part with
respect to Exhibit 2012, and dismissed in part with respect to Exhibits 2016–
2021;
FURTHER ORDERED that Exhibit 2025 is excluded from the record;
and
FURTHER ORDERED that because this is a final written decision,
the parties to this proceeding seeking judicial review of our Decision must
comply with the notice and service requirements of 37 C.F.R. § 90.2.

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For PETITIONER:
Harper Batts
Jeffrey Liang
Chris Ponder
SHEPPARD, MULLIN, RICHTER & HAMPTON LLP
hbatts@sheppardmullin.com
cponder@sheppardmullin.com
jliang@sheppardmullin.com
LegalTm-DivX-IPR@sheppardmullin.com

For PATENT OWNER:
Kenneth J. Weatherwax
Bridget Smith
Flavio Rose
Edward Hsieh
Parham Hendifar
Patrick Maloney
Jason C. Linger
LOWENSTEIN & WEATHERWAX LLP
weatherwax@lowensteinweatherwax.com
smith@lowensteinweatherwax.com
rose@lowensteinweatherwax.com
hsieh@lowensteinweatherwax.com
hendifar@lowensteinweatherwax.com
maloney@lowensteinweatherwax.com
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