Apple Inc.v.Contentguard Holdings, Inc.

Patent Trial and Appeal Board

Jul 13, 2015

13585408 (P.T.A.B. Jul. 13, 2015)

Trials@uspto.gov Paper No. 9
571.272.7822 Filed: July 13, 2015

UNITED STATES PATENT AND TRADEMARK OFFICE
____________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________

APPLE INC.,
Petitioner,

v.

CONTENTGUARD HOLDINGS, INC.,
Patent Owner.
____________

Case IPR2015-00451
Patent 8,393,007 B2
____________

Before BARBARA A. PARVIS, KERRY BEGLEY, and
KEVIN W. CHERRY, Administrative Patent Judges.

BEGLEY, Administrative Patent Judge.

DECISION
Denying Institution of Inter Partes Review
35 U.S.C. § 314(a), 37 C.F.R. § 42.108

Apple Inc. (“Petitioner”) filed a Petition requesting an inter partes
review of claims 1–15 of U.S. Patent No. 8,393,007 B2 (Ex. 1007, “the ’007
patent”). ContentGuard Holdings, Inc. (“Patent Owner”) filed a Preliminary
Response to the Petition. Paper 8 (“Prelim. Resp.”).
IPR2015-00451
Patent 8,393,007 B2

2
Pursuant to 35 U.S.C. § 314(a), an inter partes review may not be
instituted unless “the information presented in the petition . . . and any
response . . . shows that there is a reasonable likelihood that the petitioner
would prevail with respect to at least 1 of the claims challenged in the
petition.” Having considered the Petition and the Preliminary Response, we
determine that there is not a reasonable likelihood that Petitioner would
prevail in establishing that any of the challenged claims of the ’007 patent
are unpatentable. For the reasons that follow, we deny institution of inter
partes review.
I. BACKGROUND
A. THE ’007 PATENT
The ’007 patent relates to “distribution and usage rights enforcement
for digitally encoded works.” Ex. 1007, 1:26–27. According to the
’007 patent, the ease with which electronically published materials can be
reproduced and distributed is a major concern and presents a fundamental
issue: “how to prevent the unauthorized and unaccounted distribution or
usage of [these] materials.” Id. at 1:31–45.
The ’007 patent explains several known techniques for preventing
such “unauthorized and unaccounted distribution or usage,” including
preventing unauthorized copying and transmission as well as distributing
software that requires a “key” to enable its use. Id. at 1:63–2:18. These
techniques, however, operate by preventing subsequent distribution of a
work and “sacrifice[e] the potential for subsequent revenue bearing uses.”
Id. at 3:4–8. The ’007 patent notes that it would be desirable for the owner
of a digital work to have flexibility in how the work may be distributed. Id.
at 3:12–14. For example, it may be desirable to allow lending of a
IPR2015-00451
Patent 8,393,007 B2

3
purchased work to expose the work to potential buyers, creation of a
derivative work for a fee, or copying of the work for a fee. Id. at 3:8–12.
The ’007 patent purports to solve these problems by permanently
attaching usage rights to digital works and by placing digital works in
repositories. Id. at 6:24–44. Repositories are trusted systems, which support
usage rights. Id. at 6:24–44, 11:63–12:63, 49:63–67.
Claims 1, 6, and 11 of the ’007 patent are independent claims.
Claim 1 is illustrative of the claimed subject matter:
1. A computer-implemented method of distributing digital
content to at least one recipient computing device to be
rendered by the at least one recipient computing device in
accordance with usage rights information, the method
comprising:
determining, by at least one sending computing device, if the
at least one recipient computing device is trusted to
receive the digital content from the at least one sending
computing device;
sending the digital content, by the at least one sending
computing device, to the at least one recipient computing
device only if the at least one recipient computing device
has been determined to be trusted to receive the digital
content from the at least one sending computing device;
and
sending usage rights information indicating how the digital
content may be rendered by the at least one recipient
computing device, the usage rights information being
enforceable by the at least on recipient computing device.
Id. at 50:31–49.
B. ASSERTED GROUND OF UNPATENTABILITY
The Petition challenges claims 1–15 of the ’007 patent as obvious
under 35 U.S.C. § 103 over: U.S. Patent No. 5,557,518 (filed April 28,
1994) (issued September 17, 1996) (Ex. 1020, “Rosen”) and European
IPR2015-00451
Patent 8,393,007 B2

4
Patent Application Publication No. EP 0 567 800 A1 (published November
3, 1993) (Ex. 1021, “Hartrick”). Pet. 3. Petitioner provides the Declaration
of Alan Sherman, Ph.D. (Ex. 1013, “the Dr. Sherman Declaration”) as
support for this asserted ground.
II. ANALYSIS
A. NON-COMPLIANCE WITH 35 U.S.C. § 312(A)(3) AND 37 C.F.R.
§§ 42.22(A)(2), 42.104(B)(4)–(5)
Under 35 U.S.C. § 312(a)(3), a petition for inter partes review “may
be considered only if . . . the petition identifies, in writing and with
particularity, each claim challenged, the grounds on which the challenge to
each claim is based, and the evidence that supports the grounds for the
challenge to each claim.” 35 U.S.C. § 312(a)(3) (emphases added). Our
rules further address the showing required in a petition. In particular,
37 C.F.R. § 42.104(b)(4) provides that “[t]he petition must specify where
each element of the claim is found in the prior art patents or printed
publications relied upon,” 37 C.F.R. § 42.104(b)(4) (emphasis added), and
37 C.F.R. § 42.104(b)(5) adds that the Petition must “identify[] specific
portions of the evidence that support the challenge,” 37 C.F.R.
§ 42.104(b)(5) (emphasis added). Similarly, 37 C.F.R. § 42.22(a)(2) states
that a petition “must include . . . [a] full statement of the reasons for the
relief requested, including a detailed explanation of the significance of the
evidence.” 37 C.F.R. § 42.22(a)(2) (emphases added). For the reasons
discussed below, we agree with Patent Owner’s assertions that the Petition
fails to comply with each of these requirements. See Prelim. Resp. 4–10.
As background, we provide an overview of the structure of the
Petition, which informs the deficiencies we explain below. The Petition
starts its analysis of the asserted ground with a general discussion of Rosen
IPR2015-00451
Patent 8,393,007 B2

5
and Hartrick. Pet. 22–38 (§§ IV.A–B). This discussion includes
characterizations of what a person of ordinary skill in the art would have
“known” and “would have understood” from each reference, with supporting
citations to the Dr. Sherman Declaration. Id.; see, e.g., id. at 29 (citing
Ex. 1013 ¶¶ A159–A160, E28); id. at 37 (citing Ex. 1013 ¶¶ E91–E96, E85–
E87). Then, the Petition proffers a hypothetical, integrated system that
purports to combine the teachings and suggestions of Rosen and Hartrick
with the knowledge of a person of ordinary skill in the art (“the Hypothetical
Rosen-Hartrick System”). Id. at 38–44 (§ IV.C). Next, the Petition argues
that the Hypothetical Rosen-Hartrick System “suggests” two sets of claim
terms: (1) “usage rights,” and (2) “sending computing device” (or “sending
apparatus”) and “recipient computing device.”1 Id. at 44–50 (§ IV.D).
Finally, the Petition asserts that the Hypothetical Rosen-Hartrick System
“would” teach or suggest each limitation of the fifteen challenged claims.
Id. at 50–60 (§ IV.E). This section relies on the previous descriptions,
characterizations, and proposed combination of Rosen and Hartrick.
As a result, the Petition’s obviousness analysis, which compares the
’007 patent claims to the Hypothetical Rosen-Hartrick System, is at least
two or three levels removed from the actual disclosures of Rosen and
Hartrick. These multiple levels of abstraction obscure Petitioner’s position
regarding which reference, and which portion of which reference, teaches or

1 The relevant section of the Petition specifically argues that the
Hypothetical Rosen-Hartrick System would include “repositories.” Pet. 47–
50. The term “repository” is not recited in the ’007 patent claims, but the
Petition elsewhere argues that the claim terms “sending computing device”
(or “sending apparatus”) and “recipient computing device” must be
repositories. Id. at 15–17. Thus, we understand the relevant section to argue
that the Hypothetical Rosen-Hartrick System would meet these claim terms.
IPR2015-00451
Patent 8,393,007 B2

6
suggests the claim limitations. It also blurs the actual teachings and
suggestions of each reference from Petitioner’s characterizations and
modifications of these teachings and suggestions in creating the proposed
Hypothetical Rosen-Hartrick System.
In addition, the entire Petition is riddled with vague, nested citations
to broad sections of Rosen, Hartrick, the Dr. Sherman Declaration, other
exhibits, and other sections of the Petition. See, e.g., id. at 41 (“Ex. 1013 at
¶ E115-16; see § IV.A.5; Ex. 1020 at 17:41-24:63.”); id. at 46–47 (“See
§§ IV.B.3, C; Ex. 1021 at 6:9-22, Fig. 1; Ex. 1020 at 8:22-34; Ex. 1013 at
¶ E115-18.”); id. at 47 (“See § IV.B.2; Ex. 1021 at 10:1-7, 12:8-12; Ex. 1013
at ¶ E71, E97-98, E124, E105-08.”). This practice is most problematic in
the section addressing how the Hypothetical Rosen-Hartrick System
allegedly “would” teach or suggest every limitation of the ’007 patent
claims. See Pet. 50–60. The sentences in this section routinely are followed
by incomprehensible citations to vast portions of the record, such as “See
§§ IV.A.3, IV.B.3, IV.C; Ex. 1020 at 8:22-34; Ex. 1021 at 6:9-22; Ex. 1013
at ¶ E104-05, E117-18, E194” (Pet. 51), “See §§ IV.B.3, C; Ex. 1013 at
¶ E99-100, E117-21; Ex. 1020 at 6:12-13, 6:3-4; Ex. 1021 at 6:9-22, 10:1-
14” (Pet. 53), and “See §§ IV.A.5, IV.E.4; Ex. 1020 at 37:29-49, 15:49-51;
see id. at 15:49-51; Ex. 1013 at ¶¶ E226-E228, E41-E52” (Pet. 59–60). See
Pet. 50–60.
As one representative example, the Petition features less than one
page of analysis addressing how the Hypothetical Rosen-Hartrick System
allegedly would suggest the last limitation of independent claim 1, “sending
usage rights information indicating how the digital content may be rendered
by the at least one recipient computing device, the usage rights information
IPR2015-00451
Patent 8,393,007 B2

7
being enforceable by the at least on recipient computing device,” and the
corresponding limitation in independent claims 6 and 11. Id. at 52–53. This
analysis directly cites: (1) four other sections (§§ IV.B.3, IV.C, IV.D.1,
IV.E.1.d), or approximately ten pages, of the Petition; (2) twenty-three
paragraphs (¶¶ E6–E8, E99–E100, E104–E114, E117–E121, E134, E197),2
or approximately eight pages, of the Dr. Sherman Declaration; (3) sections
of one column of Rosen; and (4) portions of four columns of Hartrick.
See id.
The four sections of the Petition cited in this analysis further cite:
(1) another seven sections (§§ IV.A.1–5, IV.B.2, IV.D.2), or approximately
sixteen pages, of the Petition, (2) approximately fifty paragraphs, or eighteen
pages, of the Dr. Sherman Declaration, (3) different portions of at least
thirteen columns, including seven full columns, of Rosen, and (4) separate
portions of at least eleven columns and three figures of Hartrick. See id.
at 37–44, 52. In addition, the twenty-three cited paragraphs of the
Dr. Sherman Declaration cite an additional: (1) approximately seventy
paragraphs, or twenty-five pages, of the Declaration, (2) sections of at least
four more columns and one figure of Rosen, and (3) portions of at least five
more columns and one figure of Hartrick. As a result—without considering
the additional internal cross-references in these sections of the Petition and
paragraphs of the Dr. Sherman Declaration—the cursory analysis of this

2 Our count excludes the citation to the Dr. Sherman Declaration, Ex. 1013
¶¶ E193–E201, in the last sentence of the analysis. Pet. 53. Based on our
review of the sentence and its supporting citation to the Declaration—which
includes the claim charts for every limitation of the independent claims—we
consider the sentence to be a summary of the Petition’s analysis of the
independent claims and not to be directed to a particular limitation.
IPR2015-00451
Patent 8,393,007 B2

8
limitation in the Petition cites: (1) eleven sections, or approximately twenty-
five pages, of the Petition, (2) more than 110 paragraphs, or forty pages, of
the Dr. Sherman Declaration, (3) sections of at least fourteen columns
(including at least seven full columns) and one figure of Rosen, and
(4) portions of at least fifteen different columns and three figures of
Hartrick.
The pervasive use of internal cross-references within the Petition and
the Dr. Sherman Declaration further obfuscates the evidentiary support for
the Petition’s assertions. For example, the three-page section of the Petition
that addresses how the Hypothetical Rosen-Hartrick System would satisfy
the three independent claims of the ’007 patent (§ IV.E.1) features nineteen
internal cross-references to ten sections of the Petition (§§ III.D.4, IV.A.1–3,
IV.A.5, IV.B.3, IV.C, IV.D.1–2, IV.E.1.d), which span approximately
twenty-two pages. Pet. 50–53. Further, Dr. Sherman’s declaration
testimony—cited extensively in the Petition—is routinely, and often
exclusively, supported by internal cross references to other paragraphs of the
Declaration. See, e.g., Ex. 1013 ¶ E106 (including citation “See ¶¶ A62-90,
above” to twenty-nine other paragraphs of the Declaration); id. ¶ 117
(same); id. ¶ E124 (including citation “See ¶¶ E78-E98, E108-E114, above”
to twenty-eight other paragraphs of the Declaration). Petitioner’s claim
charts, which appear only in the Dr. Sherman Declaration, are supported
exclusively by internal cross-references, generally to vast sections of the
Declaration. See id. ¶¶ E194–E197, E214, E221, E228; see, e.g., id. ¶ E194
(claim chart for preamble of claim 1, citing seventy-two paragraphs (¶¶ E2–
E10, E21–E37, E74–E98, E104–E114, E136–E145) of the Dr. Sherman
Declaration); id. ¶ 196 (claim chart for limitation “1.a,” citing forty-five
IPR2015-00451
Patent 8,393,007 B2

9
paragraphs (¶¶ E4, E21–E37, E39–E45, E53–E69, E99–E100, E186) of the
Dr. Sherman Declaration).
These defects in the Petition are compounded by the Petition’s
repeated citation to broad sections of the Dr. Sherman Declaration to support
conclusory arguments and reasoning. See Prelim. Resp. 8–10. The
Dr. Sherman Declaration is a 474-page omnibus declaration covering
nineteen petitions for inter partes review challenging the ’007 patent and
four related patents. See generally Ex. 1013. More than 150 pages of the
Declaration are relevant to this Petition. See id. §§ I–V.C.2, V.C.4–5, V.C.7,
V.C.11, V.D.7–8, VIII.A–D, VIII.E.4.
The Petition regularly cites to large sections of the Dr. Sherman
Declaration as support for otherwise unexplained statements. For example,
one sentence of the Petition states, without explanation: “Implemented in
this manner, each right specified in the ‘Usage’ field of the Rosen decryption
ticket would be a statement in a ‘usage rights language.’ Ex. 1013 at
¶ E141, E124; see id. at ¶ E71-98.” Pet. 47. The thirty paragraphs of
Dr. Sherman Declaration cited as support for this sentence span nearly ten
pages. Similarly, another sentence of the Petition makes the conclusory
assertion: “Thus, Rosen teaches a secure transaction that a person of skill
would incorporate into a combined system. Ex. 1013 at ¶¶ E38-E52.”
Pet. 59. The supporting citation to the Dr. Sherman Declaration covers
fifteen paragraphs, or six pages.
More generally, many sections of the Petition feature sparse
explanation, and rely heavily on supporting citations to the Dr. Sherman
Declaration to buttress the conclusory analysis. For example, the three-page
section of the Petition arguing that the Hypothetical Rosen-Hartrick System
IPR2015-00451
Patent 8,393,007 B2

10
would teach or suggest the three independent claims of the ’007 patent
(§ IV.E.1) directly cites more than 135 paragraphs (¶¶ E1–E114, E117–
E121, E134, E136–E145, E193–E201), or fifty pages, of the Dr. Sherman
Declaration. See id. at 50–53. Thus, even without accounting for the
additional internal cross-references within these paragraphs of the
Declaration, the supporting declaration testimony is more than sixteen times
the length of the relevant discussion in the Petition.
Put simply, the Petition generally does not stand on its own, and its
arguments often are incomprehensible without reviewing broad portions of
the Dr. Sherman Declaration, the length of which exceeds the relevant
discussion in the Petition by multitudes. The Petition’s practice of citing
multiple pages of the Dr. Sherman Declaration to support conclusory
statements and more generally, using the Declaration to vastly expand its
thin analysis and reasoning violates our rules in two respects.
First, this practice amounts to incorporation by reference—which is
impermissible under our rules. See 37 C.F.R. § 42.6(a)(3) (“Arguments
must not be incorporated by reference from one document into another
document.”); Cisco Sys., Inc. v. C-Cation Techs., LLC, Case IPR2014-
00454, slip op. at 7–10 (PTAB Aug. 29, 2014) (Paper 12) (informative).
This incorporation by reference from the 474-page Declaration into the
Petition “serves to circumvent the [60-]page limit[] imposed on petitions for
inter partes review, while imposing on our time by asking us to sift through
[hundreds of] pages of [the] Declaration (including numerous pages of claim
charts) to locate the specific [relevant] arguments.” Cisco Sys., Inc.,
IPR2014-00454, slip op. at 10 (Paper 12) (informative); see 37 C.F.R.
§ 42.24(a)(1)(i). Arguments and information that are not presented and
IPR2015-00451
Patent 8,393,007 B2

11
developed in the Petition, and instead are incorporated by reference to the
Dr. Sherman Declaration, are not entitled to consideration.
Second, the Petition’s consistent citation to voluminous portions of
the Dr. Sherman Declaration, which generally include additional internal
cross-references, runs afoul of the particularity and specificity required of
supporting evidence under our governing statute and rules. See 35 U.S.C.
§ 312(a)(3); 37 C.F.R. §§ 42.22(a)(2), 42.104(b)(4)–(5).
In sum, the Petition’s conclusory analysis with supporting citations to
an incomprehensible web of internal cross-references to the Petition and the
Dr. Sherman Declaration and imprecise citations to Rosen and Hartrick
leaves us “to play archeologist with the record.” Cisco Sys., Inc., IPR2014-
00454, slip op. at 10 (Paper 12) (informative). Based on the deficiencies
addressed above, the Petition fails: (1) to specify sufficiently where the
limitations of claims 1–15 of the ’007 patent are taught or suggested by
Rosen or Hartrick; and (2) to provide a sufficiently detailed explanation of
the significance of the citations to these references and the Dr. Sherman
Declaration—as required under 35 U.S.C. § 312(a)(3), 37 C.F.R.
§ 42.22(a)(2), and 37 C.F.R. § 42.104(b)(4)–(5). We, therefore, deny
institution of the asserted ground of obviousness over Rosen and Hartrick.
B. DEFECTS IN THE PROFFERED OBVIOUSNESS ANALYSIS
Turning to the merits, we deny institution of the asserted ground based
on Rosen and Hartrick for two additional, independent reasons. First, the
Petition fails to perform the obviousness analysis required under Graham v.
John Deere Co., 383 U.S. 1 (1966). Second, the obviousness analysis
proposed in the Petition does not provide sufficiently articulated reasoning,
with rational underpinning, to combine Rosen and Hartrick to reach the
IPR2015-00451
Patent 8,393,007 B2

12
invention recited in the challenged claims and, instead, is driven by improper
hindsight. We address each deficiency in turn.
1. Failure to Perform a Graham Analysis
A patent claim is unpatentable as obvious under 35 U.S.C. § 103(a)3 if
“the differences between” the claimed subject matter and the prior art “are
such that the subject matter as a whole would have been obvious at the time
the invention was made to a person having ordinary skill in the art to which
said subject matter pertains.” 35 U.S.C. § 103(a); KSR Int’l Co. v. Teleflex
Inc., 550 U.S. 398, 406 (2007). The legal conclusion of obviousness is
resolved on the basis of underlying factual determinations, including:
(1) “the scope and content of the prior art,” (2) “differences between the
prior art and the claims at issue,” (3) “the level of ordinary skill in the
pertinent art,” and (4) any “secondary considerations,” or objective indicia,
of nonobviousness. Graham, 383 U.S. at 17–18. These underlying factual
determinations “must be considered by the trier of fact” in an obviousness
analysis. ATD Corp. v. Lydall, Inc., 159 F.3d 534, 546 (Fed. Cir. 1998).
Here, as Patent Owner points out, the Petition fails to identify
sufficiently the differences between any claim of the ’007 patent and the
asserted prior art references, Rosen and Hartrick. See Pet. 22–60; Prelim.
Resp. 6–7, 42. Rather than address these differences, the Petition creates the
Hypothetical Rosen-Hartrick System—based on how a person of ordinary
skill in the art allegedly “would” or “could” combine the two references into
an integrated system—in an analysis that is divorced entirely from the

3 The Leahy-Smith America Invents Act (“AIA”), Pub. L. No. 112-29, 125
Stat. 284 (2011), revised 35 U.S.C. § 103, effective March 16, 2013.
Because the ’007 patent was filed before March 16, 2013, our references and
citations to § 103 in this decision are to the pre-AIA version.
IPR2015-00451
Patent 8,393,007 B2

13
language of the ’007 patent claims. See Pet. 38–44 (§ IV.C). The Petition
then argues, in conclusory fashion, that this hypothetical system “would”
teach or suggest the limitations of the claims. See id. at 50–60 (§ IV.E).
This analysis—which compares the challenged claims to a hypothetical
integrated system that allegedly implements elements of both Rosen and
Hartrick as well as the knowledge of a person of ordinary skill in the art—
obscures any comparison of the individual prior art references to the claim
limitations. It does not explain with any particularity which claim
limitations are absent from Rosen or Hartrick. See Prelim. Resp. 6, 42.
Therefore, the Petition fails to perform an adequate Graham analysis, as
required for an obviousness determination.
Accordingly, we determine that the Petition does not show a
reasonable likelihood that Petitioner would prevail in showing that claims 1–
15 of the ’007 patent would have been obvious over Rosen and Hartrick.
See Apple Inc. v. SmartFlash LLC, Case CBM2015-00029, slip op. at 16–18
(PTAB May 28, 2015) (Paper 11) (denying institution of an asserted
obviousness ground based on Petitioner’s failure to explain adequately any
differences between the asserted prior art and the claimed invention); Liberty
Mut. Ins. Co. v. Progressive Casualty Ins. Co., Case CBM2012-00003, slip
op. at 3 (PTAB Oct. 25, 2012) (Paper 7) (representative) (“A petitioner who
does not state the differences between a challenged claim and the prior art,
and relies instead on the Patent Owner and the Board to determine those
differences . . . risks having the corresponding ground of obviousness not
included for trial for failing to adequately state a claim for relief.”).
IPR2015-00451
Patent 8,393,007 B2

14
2. Lack of Rationale to Combine and Improper Hindsight
Turning to the asserted rationale to combine Rosen and Hartrick, the
Supreme Court has explained that an obviousness analysis should
“determine whether there was an apparent reason to combine the known
elements in the fashion claimed by the patent at issue.” KSR, 550 U.S.
at 418. Similarly, the Federal Circuit has made clear that an obviousness
determination “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.” In re Kahn, 441 F.3d 977, 988
(Fed. Cir. 2006), cited with approval in KSR, 550 U.S. at 418. An
obviousness analysis, however, must “avoid hindsight reconstruction by
using the patent in suit as a guide through the maze of prior art references,
combining the right references in the right way so as to achieve the result of
the claims in suit.” In re NTP, Inc., 654 F.3d 1279, 1299 (Fed. Cir. 2011)
(internal citation and quotation omitted).
Here, the Petition appears to classify the changes necessary to reach
the Hypothetical Rosen-Hartrick System as consisting of four modifications.
See Pet. 38–44 (labeling certain paragraphs as “[f]irst,” “[s]econd,” “[t]hird,”
and “[f]inally”) (emphases omitted). Based on our review of the Petition as
well as Rosen and Hartrick, however, we find that what the Petition appears
to classify as a single modification often includes several distinct changes.4

4 Section IV.D of the Petition, which follows the section that proposes the
Hypothetical Rosen-Hartrick System (§ IV.C), refers to modifications of
Rosen and Hartrick. Pet. 44–50. The Petition does not explain whether
these changes are the same as those discussed previously. Thus, it is unclear
whether they are distinct from, and in addition to, the previously proposed
changes.
IPR2015-00451
Patent 8,393,007 B2

15
Further, we find the reasons proffered in the Petition for the proposed
modifications in assembling the Hypothetical Rosen-Hartrick System to be
conclusory and superficial.
For example, the Petition proposes a “[f]irst” modification, which
appears to be directed to allowing the Hypothetical Rosen-Hartrick System
to satisfy at least the “usage rights” limitations recited in the independent
claims of the ’007 patent. See id. at 39–41, 44–47, 50–53. Specifically, the
Petition proposes storing “security and royalty markup statements in the
‘Usage’ field” of Rosen. Id. at 39, 44. The Petition justifies this
modification as a “logical” and “obvious” means “to specify ‘restrictions on
usage of the electronic object’ within the Rosen scheme.” Id. at 39.
The discussion of this modification, however, includes several
changes that a person of ordinary skill allegedly “could” have made, with
little to no reasoning to support a determination that it would have been
obvious to combine the elements as proposed.5 The Petition asserts that a
person of ordinary skill “could have modified” Rosen’s merchant’s trusted
agent (“MTA”) to include Hartrick’s specialized Standard Generalized
Markup Language (“SGML”) tags, such as the “Do Not Copy” tag and the
“Do Not Distribute” tag, to “specify[] the different manners of use for the
electronic object when creating each decryption ticket.” Id. at 39–40, 44. In
addition, the Petition contends that the MTA “also could use different types
of royalty tags to specify additional rights a user could exercise for a fee,
such as a ‘print-royalty’ tag specifying a fee for printing . . . and a ‘copy-

5 To the extent the Dr. Sherman Declaration provides additional arguments
and explanation not mentioned in the Petition, we need not and do not
consider this testimony for the reasons stated above in Part II.A.
IPR2015-00451
Patent 8,393,007 B2

16
royalty’ tag specifying a different fee for making a copy.” Id. at 40.
Further, the Petition asserts that it would have been “an obvious
implementation choice to have the security tags . . . grant affirmative rights,”
because a person of ordinary skill “would have known that system security
is improved when a user has no rights unless explicitly granted.” Id. at 40–
41. For example, the Petition proposes using “a ‘Display’ tag”—“instead of
[the] ‘Do Not Copy’” tag disclosed in Hartrick—or “a ‘Print’ tag and a
‘Display’ tag”—“instead of [the] ‘Do Not Distribute’” tag disclosed in
Hartrick. Id. at 40–41, 45. The Petition argues that “[t]his could be done
within the Hartrick scheme by having separate “Display” and “Print” tags, or
by using a royalty tag with no fee.” Id. at 41. According to the Petition, the
choice of tags is a “simple design choice,” “routinely . . . made by that
person of ordinary skill.” Id. Finally, the Petition asserts that, although
Hartrick “describes its technique in the context of softcopy books, a person
of skill could apply it to any type of electronic object distributed via Rosen’s
system, and would modify the tags accordingly to reflect the actions
associated with other types of content.” Id.
We are not persuaded that the Petition proffers adequate supported
reasoning, with rational underpinning, for the proposed changes contained
within what the Petition refers to as the “[f]irst” modification, as outlined
above. Beyond asserting that one of the changes would have been an
“obvious,” “simple,” and “routine[]” “implementation” or “design choice,”
the Petition lacks sufficient explanation as to why a person of ordinary skill
would make the other proposed changes discussed above. Id. at 39–41.
The other modifications proffered in the Petition contain similarly
unpersuasive and deficient reasoning. For example, the fourth modification
IPR2015-00451
Patent 8,393,007 B2

17
proposes that “a person of skill would have adjusted Rosen’s cryptographic
protocols to accommodate any particular implementation that was desired.”
Id. at 43. The Petition explains that “during a purchase transaction [in
Rosen,] the [consumer’s trusted agent (‘CTA’)] will initiate the Establish
Session protocol by sending the MTA its digital certificate.” Id. The
Petition then argues that “[i]t would [have] be[en] an inconsequential
variation of this process to instead configure the purchase protocol such that
the MTA”—rather than the CTA—“initiated the Establish Session protocol
by sending the CTA its digital certificate.” Id. at 43–44. Dr. Sherman’s
supporting testimony, cited in the Petition, opines that a person of ordinary
skill “could easily have” made this change. Ex 1013 ¶ E123; see Pet. 43–44
(citing Ex. 1013 ¶¶ E122–E123, E139). Yet both the Petition’s justification
for this change as “an inconsequential variation” of Rosen’s process and
Dr. Sherman’s testimony that a person of ordinary skill readily could have
made the change fail to provide a sufficient reason for making the change.
Particularly when the many proposed changes are considered together,
the Petition lacks adequate reasoning, with rational underpinning, to show
sufficiently that a person of ordinary skill would have combined the
teachings of Rosen and Hartrick and the knowledge in the art to reach the
Hypothetical Rosen-Hartrick System, which the Petition alleges would
satisfy each limitation of the challenged claims. In other words, we are not
persuaded that the Petition sufficiently explains why a person of ordinary
skill would simultaneously make all of the many particular proposed
changes and implementation choices to combine Rosen, Hartrick, and
allegedly known techniques.
IPR2015-00451
Patent 8,393,007 B2

18
Rather, given the extent of the proposed modifications as well as the
thin reasoning proffered for each modification, we conclude that the Petition
improperly “reli[es] upon ex post reasoning” and impermissible hindsight
reconstruction to piece together the Hypothetical Rosen-Hartrick System in a
manner meant to resemble the ’007 patent claims. See KSR, 550 U.S. at 421.
The Petition strains to make numerous distinct modifications, picking and
choosing aspects of Rosen and Hartrick—in addition to techniques not
disclosed in either reference that allegedly were known in the art—to arrive
at the Hypothetical Rosen-Hartrick System. See Pet. 38–50. “This type of
piecemeal analysis is precisely the kind of hindsight that [we] must not
engage in.” NTP, 654 F.3d at 1299 (“Care must be taken to avoid hindsight
reconstruction by using the patent in suit as a guide through the maze of
prior art references, combining the right references in the right way so as to
achieve the result of the claims in suit.”) (internal citation and quotation
omitted); see also ATD Corp., 159 F.3d at 546 (“Determination of
obviousness can not be based on the hindsight combination of components
selectively culled from the prior art to fit the parameters of the patented
invention.”).
In sum, we are not persuaded that the Petition shows sufficiently that
a person of ordinary skill in the art—without improper hindsight—would
have combined Rosen and Hartrick and modified them as the Petition
suggests to reach the invention recited in claims 1–15 of the ’007 patent.
Therefore, we determine that the Petition does not establish a reasonable
likelihood that Petitioner would prevail in showing that any of the
challenged claims would have been obvious over Rosen and Hartrick.
IPR2015-00451
Patent 8,393,007 B2

19
III. ORDER
For the reasons given, it is:
ORDERED that pursuant to 35 U.S.C. § 314(a), the Petition is denied.

IPR2015-00451
Patent 8,393,007 B2

20
PETITIONER:
Jeffrey P. Kushan
Michael R. Franzinger
SIDLEY AUSTIN LLP
jkushan@sidley.com
mfranzinger@sidley.com
iprnotices@sidley.com

PATENT OWNER:

Nicholas T. Peters
Timothy P. Maloney
FITCH, EVEN, TABIN & FLANNERY LLP
ntpete@fitcheven.com
tpmalo@fitcheven.com

Robert A. Cote
MCKOOL SMITH, P.C.
rcote@mckoolsmith.com