HTC Corporationv.ADVANCED AUDIO DEVICES, LLC

Patent Trial and Appeal Board

Jan 22, 2016

12855510 (P.T.A.B. Jan. 22, 2016)

Trials@uspto.gov Paper 41
571-272-7822 Date: January 22, 2016

UNITED STATES PATENT AND TRADEMARK OFFICE
____________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________

HTC CORPORATION and HTC AMERICA, INC.,
Petitioner,

v.

ADVANCED AUDIO DEVICES, LLC,
Patent Owner.

____________

Case IPR2014-01157
Patent 7,933,171 B2
____________

Before SCOTT A. DANIELS, CHRISTOPHER L. CRUMBLEY, and
GEORGIANNA W. BRADEN, Administrative Patent Judges.

CRUMBLEY, Administrative Patent Judge.

FINAL WRITTEN DECISION
35 U.S.C. § 318 and 37 C.F.R. § 42.73

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I. INTRODUCTION
In this inter partes review trial, instituted pursuant to 35 U.S.C. § 314,
Petitioner HTC Corporation and HTC America, Inc. (collectively, “HTC”)
challenges the patentability of claims 1, 2, 5, 6, 7, 14, 17, 20, 23, 26, 28, 37,
40, 42, 43, and 45–48 of U.S. Patent No. 7,933,171 B2 (Ex. 1001, “the ’171
patent”), owned by Advanced Audio Devices, LLC (“AAD”).
We have jurisdiction under 35 U.S.C. § 6(c). This Final Written
Decision, issued pursuant to 35 U.S.C. § 318(a) and 37 C.F.R. § 42.73,
addresses issues and arguments raised during trial. For the reasons
discussed below, we determine that HTC has met its burden to prove, by a
preponderance of the evidence, that claims 1, 2, 5, 6, 7, 14, 17, 20, 23, 26,
28, 37, 40, 42, 43, and 45–48 of the ’171 patent are unpatentable.
A. Procedural History
On July 11, 2014, HTC filed a Petition requesting inter partes review
of claims 1, 2, 5, 6, 7, 14, 17, 20, 23, 26, 28, 37, 40, 42, 43, and 45–48 of the
’171 patent. Paper 1, “Pet.” AAD filed a Patent Owner’s Preliminary
Response. Paper 5. In a Decision on Institution of Inter Partes Review
(Paper 6, “Dec.”), we instituted trial on claims 1, 2, 5, 6, 7, 14, 17, 20, 23,
26, 28, 37, 40, 42, 43, and 45–48 based on the following grounds:
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1. Whether claims 1, 2, 5, 6, 7, 14, 17, 20, 26, 28, 37, 40, 42, 43, and 45–
48 are unpatentable under 35 U.S.C. § 103 as having been obvious
over the combined disclosures of Nathan ’2591 and Nathan ’255;2
2. Whether claims 1, 2, 5, 6, 7, 14, 17, 20, 26, 28, 37, 40, 42, 43, and 45–
48 are unpatentable under 35 U.S.C. § 103 as having been obvious
over the combined disclosures of Sound Blaster,3 Lucente,4 Ozawa,5
and Hawkins;6 and
3. Whether claim 23 is unpatentable under 35 U.S.C. § 103 as having
been obvious over the combined disclosures of Sound Blaster,
Lucente, Ozawa, Hawkins, and Martin.7
Dec. 26.
Following institution, AAD filed a Patent Owner’s Response to the
Petition (Paper 13, “PO Resp.”), and HTC filed a Reply (Paper 21, “Pet.
Reply”). AAD also filed a contingent Motion to Amend pursuant to
37 C.F.R. § 42.121 (Paper 14, “Mot. Amend”), to which HTC filed an
Opposition (Paper 22, “Amend Opp.”), and AAD filed a Reply (Paper 25,
“Amend Reply”).

1 Ex. 1002, WO 96/12259 to Nathan et al. (Apr. 25, 1996).
2 Ex. 1003, WO 96/12255 to Nathan et al. (Apr. 25, 1996).
3 Ex. 1004, Exhibit B, Sound Blaster 16 User Reference Manual. With
Sound Blaster, HTC submits the Declaration of Kyle A. Miller, which states
that Sound Blaster was publicly available “no later than the early spring of
1995.” Ex. 1004 ¶ 13.
4 Ex. 1005, EP 0598547 A2 to Lucente et al. (May 25, 1994).
5 Ex. 1006, US 5,870,710 to Ozawa et al. (filed Jan. 22, 1997).
6 Ex. 1008, US 5,333,116 to Hawkins et al. (July 26, 1994).
7 Ex. 1007, US 5,355,302 to Martin et al. (Oct. 11, 1994).
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HTC supported its Petition with the Declaration of Christopher
Schmandt (Ex. 1009), and submitted a Rebuttal Declaration of Mr.
Schmandt (Ex. 1014) with its Reply.
With its Patent Owner Response, AAD filed the Declaration of Joseph
C. McAlexander III. Ex. 2006. HTC took the cross-examination of Mr.
McAlexander via deposition. Ex. 1018. AAD also submitted the testimony
of Peter J. Keller, a named inventor on the ’171 patent. Ex. 2007.8
AAD filed a Motion to Exclude Exhibit 1004 (Paper 27, “Mot.
Exclude”), to which HTC filed an Opposition (Paper 29, “Exclude Opp.”)
and AAD filed a Reply (Paper 33).
Oral hearing was requested by both parties, and a consolidated oral
hearing involving this trial and related trials IPR2014-01154, IPR2014-
01155, IPR2014-01156, and IPR2014-01158 was held on September 17,
2015. A transcript of the oral hearing is included in the record. Paper 40,
“Tr.”
B. The ’171 Patent
The ’171 patent discloses an audio recording device that the
specification terms a “music jukebox.” Ex. 1001, 1:16–17. According to
the specification, existing recording devices permitted music to be recorded
onto a compact disc in real time, but did not provide editing functions, the

8 Exhibit 2007 was the subject of a Motion to Seal (Paper 15), which was
granted. Paper 31. A public, redacted version of Exhibit 2007 was also filed
by AAD under the same exhibit number.
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ability to store music on the recorder for making multiple copies of the disc,
or the ability to customize easily the order in which tracks are recorded onto
the disc. Id. at 2:28–62. The described music jukebox is said to address
these issues, as well as permit a user to “audition” a stored audio track by
listening to it before recording onto a compact disc. Id. at 3:23–39.
Various hardware components of the jukebox are described in the
specification, including: audio inputs for receiving music in the form of
analog signals (id. at 7:47–58); one or more data storage structures for
storing and retrieving audio stored in digital form (id. at 9:7–16); and a drive
for recording stored audio onto compact discs (id. at 13:55–57). The audio
data stored in the memory permits audio tracks to be played back selectively,
or “auditioned,” prior to recording. Id. at 4:32–41. The components of the
music jukebox are contained in a housing having a display for providing
information to a user, for example, through a graphical user interface. Id. at
4:48–5:8. The housing also comprises a plurality of push buttons for
controlling operation of the device. Id. at 5:9–34.
The specification of the ’171 patent describes the operation of the
device as permitting a user to create a “session,” which is a group of sound
tracks selected from a master song list. Id. at 15:43–45, 16:51–59. A user
also may reorder the songs within a session by selecting songs and moving
them up or down within the session list. Id. at 16:18–28. The session then
can be written to a compact disc. Id. at 15:39–43.
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C. Illustrative Claims
Of the challenged original claims, only claim 1 is independent; all
other challenged claims depend, directly or indirectly, from claim 1. The
challenged independent claim reads as follows:
1. A personal digital stereo audio player configured to store
sound tracks and play the stored sound tracks for personal
enjoyment, said personal digital stereo audio player comprising:
a unitary, integral housing containing at least non-volatile
memory and a processor connected to the non-volatile
memory and configured for maintaining and selectively
accessing and playing sound tracks stored in the non-
volatile memory, the housing further comprising a
display controlled by the processor, the processor being
configured to cause the display to display a plurality of
menus relating to a library of sound tracks, wherein all of
the sound tracks in the library and their names are stored
in the non-volatile memory of the personal digital stereo
audio player, wherein the menus include at least one of a
list of names of sound tracks and a list of groups of sound
tracks;
a headphone jack in the housing;
an input in the housing for receiving audio data;
an amplifier operatively connected to the processor and the
headphone jack and configured to amplify audio output
signals produced during playing, which are transmitted to
the headphone jack; and
at least one touch-operable control in the housing and in
communication with the processor, wherein the processor
is configured such that:
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at least one of the at least one touch-operable control is
touchable to allow selection from the menus which
the processor causes to be displayed on the display,
at least one of the at least one touch-operable control is
touchable to control the volume at which audio is
played,
at least one of the at least one touch-operable control is
touchable to pause a sound track which is being
played,
at least one of the at least one touch-operable control is
touchable to stop a sound track as it is being played
and play the next sound track in a group of sound
tracks,
at least one of the at least one touch-operable control is
touchable to selectively power the personal digital
stereo audio player on and off, and,
at least one of the at least one touch-operable control is
touchable to select and play at least one of an
individual sound track and a group of sound tracks
through the headphone jack,
wherein the personal digital stereo audio player is
configured to display on the display at least one of time
elapsed (ascending) and time remaining (descending) for
the sound track being played,
wherein the personal digital stereo audio player is
configured such that the non-volatile memory stores a
library of sound tracks that is received by the input and
which has been pre-selected by a user,
wherein the non-volatile memory comprises at least one of a
Hard Disk Drive, solid state memory, and random
address memory,
wherein the personal digital stereo audio player is
configured to receive audio data through the input of the
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personal digital stereo audio player, whereby sound
tracks become stored in the non-volatile memory as
digital data; and
wherein the personal digital stereo audio player is
configured such that at least one of the at least one touch-
operable control is touchable to cause the personal digital
stereo audio player to display on the display at least one
of a list of names of sound tracks, and a list of groups of
sound tracks,
wherein the personal digital stereo audio player is
configured such that at least one of the at least one touch-
operable control is touchable to cause the personal digital
stereo audio player to play at least one of a specific sound
track and a group of sound tracks through the headphone
jack, and
wherein the personal digital stereo audio player is
configured such that at least one of the at least one touch-
operable control is touchable to control the volume at
which sound tracks are played through the headphone
jack.
Id. at 20:56–21:67.
In its Motion to Amend, AAD proposed substitute claims 49–67, of
which claim 49 is independent and a substitute for claim 1, if found
unpatentable. Mot. Amend 2. Claims 50–67 are proposed as substitutes for
dependent claims 2, 5, 6, 7, 14, 17, 20, 23, 26, 28, 37, 40, 42, 43, and 45–48,
respectively. Proposed claim 49 reads as follows, with underlined material
indicating language added to original claim 1:
49. A personal digital stereo audio player configured to store sound
tracks and play the stored sound tracks for personal enjoyment, said
personal digital stereo audio player comprising:
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a unitary, integral housing containing at least non-volatile memory
and a processor connected to the non-volatile memory and
configured for maintaining and selectively accessing and
playing sound tracks stored in the non-volatile memory, the
housing further comprising a display controlled by the
processor, the processor being configured to cause the display
to display a plurality of menus relating to a library of sound
tracks, wherein all of the sound tracks in the library and their
names are stored in the non-volatile memory of the personal
digital stereo audio player,
wherein the menus include at least one of a list of names of sound
tracks and a list of groups of sound tracks;
a headphone jack in the housing;
an input in the housing for receiving audio data;
an amplifier operatively connected to the processor and the
headphone jack and configured to amplify audio output signals
produced during playing, which are transmitted to the
headphone jack; and
at least one touch-operable control in the housing and in
communication with the processor,
wherein the processor is configured such that:
at least one of the at least one touch-operable control is
touchable to allow selection from the menus which the
processor causes to be displayed on the display,
at least one of the at least one touch-operable control is
touchable to control the volume at which audio is played,
at least one of the at least one touch-operable control is
touchable to pause a sound track which is being played,
at least one of the at least one touch-operable control is
touchable to stop a sound track as it is being played and play
the next sound track in a group of sound tracks,
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at least one of the at least one touch-operable control is
touchable to selectively power the personal digital stereo
audio player on and off, and,
at least one of the at least one touch-operable control is
touchable to select and play at least one of an individual
sound track and a group of sound tracks through the
headphone jack,
wherein the personal digital stereo audio player is configured to
display on the display at least one of time elapsed (ascending)
and time remaining (descending) for the sound track being
played,
wherein the personal digital stereo audio player is configured such
that the non-volatile memory stores a library of sound tracks
that is received by the input and which has been pre-selected by
a user,
wherein the non-volatile memory comprises at least one of a Hard
Disk Drive, solid state memory, and random address memory,
wherein the personal digital stereo audio player is configured to
receive audio data through the input of the personal digital
stereo audio player, whereby sound tracks become stored in the
non-volatile memory as digital data; and
wherein the personal digital stereo audio player is configured such
that at least one of the at least one touch-operable control is
touchable to cause the personal digital stereo audio player to
display on the display at least one of a list of names of sound
tracks, and a list of groups of sound tracks,
wherein the personal digital stereo audio player is configured such
that at least one of the at least one touch-operable control is
touchable to cause the personal digital stereo audio player to
play at least one of a specific sound track and a group of sound
tracks through the headphone jack, and
wherein the personal digital stereo audio player is configured such
that at least one of the at least one touch-operable control is
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touchable to control the volume at which sound tracks are
played through the headphone [jack],9
wherein the personal digital stereo audio player is configured such
that after sound tracks are stored in the non-volatile memory:
a session is addable using at least one touch-operable control on
the housing;
the session is nameable using at least one touch-operable
control on the housing;
sound tracks are addable to the session using at least one touch-
operable control on the housing;
sound tracks are deleteable from the session using at least one
touch-operable control on the housing;
wherein an order of the sound tracks in the session is
customizable using at least one touch-operable control on
the housing;
wherein the session is re-nameable using at least one touch-
operable control on the housing; and
wherein the session is deleteable using at least one touch-
operable control on the housing.
Mot. Amend, 14–16.

9 Original claim 1 concluded with the word “jack,” but proposed substitute
claim 49 does not include the word. AAD states that limitations are only
being added to the claim (Mot. Amend 2), therefore, we presume the word
“jack” was inadvertently omitted. Our analysis of the Motion to Amend
would be the same, whether the word is included or not.
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II. DISCUSSION
A. Claim Construction
For purposes of our Decision to Institute, we analyzed each claim
term in light of its broadest reasonable interpretation, as understood by one
of ordinary skill in the art and as consistent with the specification of the ’171
patent. 37 C.F.R. § 42.100(b); see In re Cuozzo Speed Techs., LLC, 793
F.3d 1268, 1278–79 (Fed. Cir. 2015), cert. granted, Cuozzo Speed Techs.
LLC v. Lee, 84 U.S.L.W. 3218 (U.S. 2016). In the Decision to Institute, we
construed the terms sound tracks and selectively accessing as follows:
sound tracks digital or analog signals, or
audio data

selectively accessing obtaining from a number or
group by fitness or preference

See Dec. 8–10 (citing 37 C.F.R. § 42.100(b)).
During the course of the trial, HTC disputed our construction of
selectively accessing, arguing that “by fitness or preference” is found only in
a single dictionary definition submitted by AAD, and is inconsistent with the
broadest reasonable interpretation of the term. Pet. Reply 1–2. We disagree.
Interpreting selectively accessing as merely “obtaining from a number or
group” would encompass, for example, random selection of sound tracks.
This is inconsistent with the specification of the ’171 patent, which
emphasizes the user’s choice in selecting sound tracks. See, e.g., Ex. 1001,
12:3–6 (“[A]n operating system . . . enable[s] the user to focus on selection
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and ordering of audio material.”). We consider HTC’s proffered
construction to be unreasonably broad given these disclosures. See
Microsoft Corp. v. Proxyconn, Inc., 789 F.3d 1292, 1298 (Fed. Cir. 2015)
(“A construction that is ‘unreasonably broad’ and which does not
‘reasonably reflect the plain language and disclosure’ will not pass
muster.”).
For these reasons, we see no reason to alter the constructions of the
claim terms as set forth above, and we incorporate our previous analysis in
the Decision to Institute for purposes of this Decision.
B. Patentability of Original Claims
1. Alleged Obviousness of Claims 1, 2, 5, 6, 7, 14, 17, 20, 26, 28, 37,
40, 42, 43, and 45–48 in View of Nathan ’259 and Nathan ’255
The elements of an obviousness analysis under 35 U.S.C. § 103 were
set forth by the Supreme Court as follows: “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.” Graham v. John Deere Co., 383 U.S. 1, 17 (1966).
Furthermore, as a guard against hindsight reasoning, we must “withhold
judgment on an obviousness challenge until [we] consider[] all relevant
evidence, including that relating to the objective considerations” such as
commercial success or long-felt need. In re Cyclobenzaprine Hydrochloride
Extended-Release Capsule Patent Litig., 676 F.3d 1063, 1079 (Fed. Cir.
2012). While we may apply “an expansive and flexible approach” to the
question of obviousness, and take the sequence of the Graham factors in a
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different order depending on the particular case, “the factors continue to
define the inquiry that controls.” KSR Int’l Co. v. Teleflex Inc., 550 U.S.
398, 407, 415 (2007).
We note, at the outset, that AAD does not contest that a person of
ordinary skill in the art would have combined the disclosures of Nathan ’259
and Nathan ’255. Tr. 80:16–24. Rather, AAD disputes HTC’s interpretation
of the Nathan references, and whether a person of ordinary skill in the art
would have understood them to disclose all elements of the challenged
claims. PO Resp. 9. Upon review of HTC’s asserted reasons to combine the
Nathan references (Pet. 17–18), Mr. Schmandt’s testimony on that point (Ex.
1009 ¶ 82), and the lack of challenge from AAD, we find that a person of
ordinary skill would have had reason to combine the Nathan references in
the manner asserted.
a. Disclosures of the Nathan References
The primary dispute between the parties on the Nathan references is
over what the references actually disclose. According to HTC, the jukebox
systems described in the Nathan systems permit purchase and download of
songs from a remote server, into a master song list stored locally on the
jukebox. Pet. 15–17. A user may then select songs from the master song list
into a queue; after the songs are played, they are deleted from the queue, but
not the local storage. Id. at 27. By contrast, AAD asserts that the jukeboxes
of Nathan permit users to purchase the right to play a song only once; when
the songs are downloaded, they are immediately added to the queue, then
deleted from local storage immediately after they are played. PO Resp. 10–
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12. According to AAD, therefore, a user of the Nathan system has no
control over the order of songs in the queue other than the order in which the
songs were purchased. Id. at 27. Nor does Nathan, in AAD’s reading,
provide any library distinct from the queue. Id. at 20–21 (“The queue is not
a subset of an internal music library; the queue is the music library.” (citing
Ex. 2006 ¶ 62)).
In our Decision to Institute, we determined that the record at that time
did not support AAD’s interpretation of the Nathan references. Rather, we
concluded that “it appears that Nathan ’259 discloses deleting songs from
the queue once they are played, not from the music library altogether.” Dec.
15 (“[w]hen the selection has been reproduced in its entirety, it is removed
from the queue file” (quoting Ex. 1002 ¶ 86)). We also determined that the
record supported the conclusion that Nathan ’259 discloses a “new
selections acquisition mode” (“NSAM”) for ordering and downloading new
music onto the jukebox. Dec. 15; Ex. 1002 ¶¶ 64–73. A “selection graphics
screen” then permits a user to add these newly acquired songs to a queue for
playback. Ex. 1002 ¶ 74. We concluded that Nathan ’259 appeared to
describe a master song list to which songs are added via the NSAM, as well
as the ability to create a queue of songs selected from the master song list
using the selection graphics screen. Dec. 15.
AAD’s Response contends that our interpretation of Nathan ’259 was
in error (PO Resp. 10), and Mr. McAlexander testifies in support of AAD’s
interpretation of the reference. Ex. 2006 ¶¶ 32–65. AAD raises several
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issues regarding the disclosure of Nathan ’259, which it contends are
inconsistent with HTC’s interpretation of the reference.
First, AAD asks why, if songs are not deleted entirely from the device
immediately following playback, Nathan ’259 does not disclose some sort of
“delete” function so that users can clear songs from the memory. PO Resp.
15–16. HTC responds by noting that Nathan ’259, as a patent document,
likely is focused on the novel aspects of the disclosed device as opposed to
known functions such as deleting files. Pet. Reply 10–11.
Prior art references are evaluated according to what they would
disclose to a person of ordinary skill in the art. See Sundance, Inc. v.
DeMonte Fabricating Ltd., 550 F.3d 1356, 1361 n.3 (Fed. Cir. 2008). As
such, the fact that a reference is silent regarding a particular feature only
signifies exclusion of that feature if a person of ordinary skill would
understand silence to imply exclusion. AAD provides no compelling
evidence this is the case with Nathan ’259. Mr. McAlexander, AAD’s
expert, testifies that there is no disclosure of a delete function in Nathan
’259, but does not state that he, or any other person of ordinary skill, would
interpret this silence to imply that a delete function is excluded. Ex. 2006
¶ 62. Furthermore, we note that Nathan ’255 explicitly discloses a manual
delete function for removing little-heard titles. Ex. 1003 ¶ 7. We do not
find the absence of an explicit “delete function” in Nathan ’259 to imply that
the Nathan jukebox does not have such a common and known function.
Second, AAD notes that Nathan ’259 discloses a system having as
little as 32 megabytes of RAM, and asks why such a small amount of
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memory is contemplated if a local music library is stored. PO Resp. 17.
HTC responds by noting that the 32 megabyte capacity is a minimum, and
Nathan ’259 puts no upper limit on the number of songs that can be stored.
Pet. Reply 11. Furthermore, HTC notes that Nathan ’255 discloses that its
device may store a “minimum of 350 to 400 titles.” Id. at 12 (citing Ex.
1003 ¶ 7). We consider HTC’s interpretation on this point to be persuasive,
and do not understand the disclosure of a 32 megabyte minimum memory
capacity to be inconsistent with our understanding of the Nathan references.
Third, AAD points out a passage in Nathan ’259 that states that a
button “allows validation of the selection or selections for initiating their
introduction into the queue,” (Ex. 1002 ¶ 74) and argues that “validation”
refers to purchase of a song. PO Resp. 11–12, 20. Therefore, under AAD’s
theory, purchase of a song results in immediate addition to the queue. Id.
HTC contends that such an interpretation would render Nathan ’259’s two
modules redundant, as there would be no reason to have both a “new
selections acquisition module” (“NSAM”) and a “selection graphics screen,”
if songs are directly added from the NSAM to the queue. Pet. Reply 9–10.
We agree with HTC, and additionally note that Nathan ’259 uses the word
“validate” in other contexts meaning “to confirm.” Ex. 1002 ¶ 75
(“validates his choice”), ¶ 114 (“validates the credit card”). We, therefore,
interpret “validation of the selection” in paragraph 74 of Nathan ’259 to
refer to confirming that a song will be added to the queue, rather than
purchase of a song.
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At oral argument, AAD discussed these issues, and raised several
other questions regarding the disclosure of Nathan ’259 which had not been
raised previously in briefing. Tr. 53–54. Even if we were to consider such
arguments properly raised,10 we do not find them persuasive. Based on our
review of the Nathan references in light of the expert testimony, our
interpretation of the Nathan disclosures has not changed.
We find that Nathan ’259 discloses a jukebox that permits the
downloading of song tracks via its NSAM. Ex. 1002 ¶¶ 64, 73 (“The
display of FIG. 9 allows the user to access the new selections acquisition
mode in connection with the NSAM module. . . . Button (1038) allows
ordering of the selection which is then downloaded according to the above
described mode.”). A different “selection graphics screen” shows the songs
that have been downloaded, permits the user to sort the songs according to
different criteria, and gives the user the ability to add songs to a queue. Id.
¶ 74 (“Button (124) allows validation of the selection or selections for
initiating their introduction into the queue or their immediate and successive
performance if the queue is empty.”). Contrary to AAD’s argument, we see
no reason to conclude that when a file is purchased and downloaded, it is
immediately added to the queue, and deleted from local memory
immediately after it is played. Nor do we find that the Nathan systems only

10 “A party may . . . only present [at oral hearing] arguments relied upon in
the papers previously submitted. No new evidence or arguments may be
presented at the oral argument.” Office Patent Trial Practice Guide, 77 Fed.
Reg. 48,756, 48,768 (Aug. 14, 2012).
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permit the order of the queue to be determined by purchase order, as
opposed to the order in which the songs are selected from the library of all
downloaded songs.
b. Analysis of Obviousness Over Nathan ’259 and Nathan ’255
i. Claim 1
There is no dispute between the parties that the Nathan references
disclose several of the elements found in the independent claims, of which
we discuss claim 1 as representative. We find that Nathan ’259 discloses,
for example: a unitary, integral housing (“box,” Ex. 1002 ¶ 46); non-volatile
memory and a connected processor (“RAM,” id. ¶ 51); a headphone jack
(“stereo audio output,” id. ¶ 42); an input for receiving audio data
(“telecommunications interface,” id. ¶ 3); at least one touch-operable control
(“a set of buttons,” id. ¶ 46); and the display of at least one of time elapsed
and time remaining for the sound track being played (“reproduction screen
displays . . . remaining time,” id. ¶ 59). Nathan ’255 additionally discloses
an amplifier (“integrated amplified loudspeakers,” Ex. 1003 ¶ 27). AAD
does not contest these elements.
Furthermore, the combination of Nathan ’259 and Nathan ’255
discloses a digital display in the housing, configured to display a plurality of
menus relating to a library of soundtracks. As AAD recognizes, Nathan
’255 discloses a touchscreen display within its housing for controlling the
jukebox. Ex. 1003 ¶ 24; PO Resp. 34. The touchscreen is a 14 inch “Intelli
Touch” screen that “allows display of various selection data used by the
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customers.” Ex. 1003 ¶ 24. Mr. Schmandt, HTC’s expert and a founder of
the MIT Media Lab with more than thirty years of experience in the media
technology field, testifies that “[a] person skilled in the art would be
motivated to implement the touch screen disclosed in Nathan 255 on the
LCD screen . . . taught by Nathan 259, to allow more intuitive control of the
jukebox.” Ex. 1009 ¶¶ 12, 13, 101. We, therefore, conclude that it would
have been obvious to include the touchscreen of Nathan ’255 in the housing
of Nathan ’259, to display the modules of Nathan ’259 such as the selection
graphics screen. See Ex. 1002 ¶ 74. The display in the housing would be
capable of displaying a plurality of menus, wherein the menus include at
least one of a list of names of song tracks, as required by claim 1.
The parties’ dispute centers on two additional elements. AAD first
argues that the references do not disclose selectively accessing and playing
soundtracks stored in the non-volatile memory. PO Resp. 34–35. To
support this argument, AAD relies on its interpretation of Nathan as
permitting only “single-play” downloads of songs, with immediate
introduction of downloaded songs into a queue that cannot be selectively
accessed. Id. As discussed above, we do not find this interpretation of
Nathan ’259’s disclosure to be the correct one.
Given our finding that Nathan ’259 discloses the ability to select
songs to download to local storage, followed by the ability to select songs
for introduction into a queue, we find that the Nathan references disclose the
ability to selectively access songs stored in memory. The songs downloaded
into Nathan’s local memory become “songs stored in memory,” and the
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selection of songs into a queue is “selectively accessing” those songs. This
satisfies our construction of selectively accessing, originally proposed by
AAD, of “obtaining from a number or group by fitness or preference.” See
supra Section II.A.
AAD also argues that the Nathan references do not disclose a touch-
operable control touchable to play at least one of an individual sound track
and a group of sound tracks stored in the non-volatile memory. PO Resp.
35–36. As outlined above, however, we find that Nathan ’259 discloses
buttons that can be used to introduce songs into its queue. Ex. 1002 ¶¶ 46,
66, 74 (“Button (124) allows validation of the selection or selections for
initiating their introduction into the queue.”). Alternatively, we find that
Nathan ’255 discloses a touchscreen that may be used to “allow[] display of
various selection data used by the customers.” Ex. 1003 ¶ 24. Once
introduced to the queue, the song will be played; if there are no songs in the
queue, the song plays immediately. Ex. 1002 ¶ 74.
For these reasons, we find that the combination of Nathan ’259 and
Nathan ’255 teaches each limitation of claim 1. AAD’s arguments to the
contrary are not persuasive.
ii. Dependent Claims
AAD does not address separately the limitations of dependent claims
2, 14, 17, 20, 26, 37, 40, 42, 43, and 45–48. See generally PO Resp.; see 37
C.F.R. § 42.23(a). These claims recite additional limitations, such as a
touch-operable control that is touchable to power the device on or off (claim
2), or to pause the playing of the sound track (claim 14). After consideration
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of the language recited in claims 2, 14, 17, 20, 26, 37, 40, 42, 43, and 45–48
of the ’171 patent, the Petition, the Patent Owner Response, and Petitioner’s
Reply, as well as the relevant evidence discussed in those papers, we find
that the additional elements recited in the dependent claims are taught or
suggested by the combination of Nathan ’259 and Nathan ’255, or that a
person of ordinary skill in the art would have modified the Nathan system to
add such features. We, therefore, conclude that HTC has met its burden of
showing that each element of challenged dependent claims 2, 14, 17, 20, 26,
37, 40, 42, 43, and 45–48 is taught by the combination of Nathan ’259 and
Nathan ’255. As discussed above, we also find that a person of ordinary
skill in the art would have had reason to combine the Nathan references.
AAD does address dependent claims 5, 6, 7, and 28 specifically, and
argues that they further distinguish over the Nathan references. PO Resp.
36–38. Claim 5 recites a touch-operable control touchable to delete a sound
track from the non-volatile memory; claims 6 and 7, dependent from claim
5, also incorporate this limitation. AAD argues that “[n]one of the displays
disclosed in either Nathan reference provides a button or control on the
housing which can be touched to delete a sound track.” Id. at 37. As we
noted above, however, Nathan ’255 discloses a manual delete function for
managers to delete little-heard tracks. Ex. 1003 ¶ 7. Furthermore, Nathan
’255 discloses that its touch screen displays “command and management
control information used by the system manager or owner,” and that a
keyboard may also be connected to the system for that purpose. Id. ¶ 24.
Therefore, we are satisfied that Nathan ’255 teaches or suggests the use of a
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touch-operable control (touchscreen or keyboard) to delete sound tracks, as
required by claims 5, 6, and 7.
AAD also argues that the Nathan references fail to disclose claim 28’s
requirement of “at least one touch-operable control . . . touchable to cause
the personal digital stereo audio player to select and play at least one of an
individual song and a group of songs stored in its non-volatile memory.” PO
Resp. 37–38. To support this argument, AAD again relies on its
interpretation of the Nathan references as disclosing only a single-play
system in which sound tracks are immediately introduced into the queue and
automatically deleted once played. Id. As discussed previously, we do not
find the Nathan references to disclose such a system. Rather, Nathan ’259
discloses acquiring new songs through its NSAM, which are locally stored
and then may be added to the queue using the selection graphics screen.
“Button (124),” which “allows validation of the selection or selections for
initiating their introduction into the queue,” is a touch-operable control
touchable to select and play an individual song or group of songs, namely
the queue. See Ex. 1002 ¶ 74.
For these reasons, we do not consider persuasive AAD’s arguments
regarding claims 5, 6, 7, or 28. Rather, we agree with HTC (Pet. 30–31, 33)
and find that the limitations of the challenged dependent claims are taught or
suggested by the combined disclosures of the Nathan references.
iii. Objective Indicia of Nonobviousness
Factual inquiries for an obviousness determination include secondary
considerations based on evaluation and crediting of objective evidence of
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nonobviousness. See Graham, 383 U.S. at 17. Notwithstanding what the
teachings of the prior art would have suggested to one of ordinary skill in the
art at the time of the invention, the totality of the evidence submitted,
including objective evidence of nonobviousness, may lead to a conclusion
that the challenged claims would not have been obvious to one of ordinary
skill in the art. In re Piasecki, 745 F.2d 1468, 1471–72 (Fed. Cir. 1984).
Secondary considerations may include any of the following: long-felt but
unsolved needs, failure of others, unexpected results, commercial success,
copying, licensing, and praise. See Graham, 383 U.S. at 17–18; Leapfrog
Enters., Inc. v. Fisher-Price, Inc., 485 F.3d 1157, 1162 (Fed. Cir. 2007);
Transocean Offshore Deepwater Drilling, Inc. v. Maersk Drilling USA, Inc.,
699 F.3d 1340, 1349, 1355 (Fed. Cir. 2012).
To be relevant, evidence of nonobviousness must be commensurate in
scope with the claimed invention. In re Kao, 639 F.3d 1057, 1068 (Fed. Cir.
2011) (citing In re Tiffin, 448 F.2d 791, 792 (CCPA 1971)); In re Hiniker
Co., 150 F.3d 1362, 1369 (Fed. Cir. 1998). In that regard, in order to be
accorded substantial weight, there must be a nexus between the merits of the
claimed invention and the evidence of secondary considerations. In re
GPAC Inc., 57 F.3d 1573, 1580 (Fed. Cir. 1995). “Nexus” is a legally and
factually sufficient connection between the objective evidence and the
claimed invention, such that the objective evidence should be considered in
determining nonobviousness. Demaco Corp. v. F. Von Langsdorff Licensing
Ltd., 851 F.2d 1387, 1392 (Fed. Cir. 1988). The burden of showing that
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there is a nexus lies with the patent owner. In re Paulsen, 30 F.3d 1475,
1482 (Fed. Cir. 1994); Demaco, 851 F.3d at 1392.
AAD argues that the “clear commercial success” of the invention
claimed in the ’171 patent demonstrates its nonobviousness, notwithstanding
the disclosures of the Nathan references. PO Resp. 48–50. To demonstrate
this alleged commercial success, AAD submits the testimony of Peter
Keller, supported by a number of confidential licenses which are said to
have generated more than $10,000,000 of gross revenue. Id. at 48. Mr.
Keller describes the “AAD Family of Patents,” which includes the ’171
patent, other related United States Patents, and foreign counterparts. Ex.
2007 ¶¶ 5, 8. Mr. Keller testifies that, for each licensee, he ensured that “at
least one commercial product sold” was covered by “at least one claim of at
least one patent” of the family. Id. ¶ 11.
In cases in which the proffered evidence of commercial success is
licenses, rather than sales of products embodying the invention, there is a
danger that the licenses may have been taken only because they were
cheaper than defending an infringement suit. See EWP Corp. v. Reliance
Universal Inc., 755 F.2d 898, 908 (Fed. Cir. 1985). In such situations, nexus
between the commercial success and the patent cannot be inferred; rather,
“affirmative evidence of nexus” is required. Iron Grip Barbell Co. v. USA
Sports, Inc., 392 F.3d 1317, 1324 (Fed. Cir. 2004). In other words, a patent
owner must demonstrate “a nexus between the merits of the invention and
the licenses of record,” otherwise the licenses are to be accorded little
weight. In re GPAC Inc., 57 F.3d at 1580 (emphasis added).
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HTC notes that each of the licenses listed by Mr. Keller includes at
least two patents that explicitly claim a compact disc recorder, an element
not present in the claims of the ’171 patent. Pet. Reply 23–24. HTC also
contends that AAD fails to demonstrate any link between the invention of
the ’171 patent and the taking of the license; for example, AAD provides no
apportionment of revenues to show the amount attributable to the ’171
patent, as opposed to the other members of the licensed family. Id. at 24.
We agree with HTC that the evidence provided by AAD does not
establish a sufficient link between the merits of the invention claimed in the
’171 patent and the taking of the licenses. Although Mr. Keller notes that
some of the provided licenses were taken in situations where there was no
pending litigation against the licensee (Ex. 2007 ¶ 9), he does not address
whether litigation had been threatened against those parties. We, therefore,
cannot determine whether the licenses reflect the commercial value of the
invention claimed in the ’171 patent, or whether they were taken merely to
avoid the cost of litigation, either pending or threatened. Absent a
persuasive showing of nexus, AAD’s evidence of licensing fails to establish
commercial success.
We conclude that the evidence of objective indicia of nonobviousness
is insufficient to overcome the evidence of obviousness over the combined
Nathan references.
iv. Conclusion on Obviousness
For the foregoing reasons, HTC has proven by a preponderance of the
evidence that Nathan ’255 and Nathan ’259 teach all elements of challenged
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claims 1, 2, 5, 6, 7, 14, 17, 20, 26, 28, 37, 40, 42, 43, and 45–48, and that a
person of ordinary skill in the art would have had reason to combine the
disclosures. Furthermore, we conclude that such a combination would have
been within the level of ordinary skill in the art, as evidenced by the prior art
of record. We, therefore, conclude that claims 1, 2, 5, 6, 7, 14, 17, 20, 26,
28, 37, 40, 42, 43, and 45–48 would have been obvious at the time of the
invention, and thus, are unpatentable under 35 U.S.C. § 103.
2. Alleged Obviousness of Claims 1, 2, 5, 6, 7, 14, 17, 20, 26, 28, 37,
40, 42, 43, and 45–48 Over Sound Blaster, Lucente, Ozawa, and
Hawkins
We instituted trial to determine whether claims 1, 2, 5, 6, 7, 14, 17,
20, 26, 28, 37, 40, 42, 43, and 45–48 would have been obvious over the
combined disclosures of Sound Blaster, Lucente, Ozawa and Hawkins,
finding persuasive HTC’s unchallenged analysis in its Petition of how the
elements of the challenged claims are taught by the references. Dec. 18–20,
24. In so doing, we noted that AAD did not dispute the alleged disclosures
of the references, but instead disputed that Sound Blaster qualified as prior
art to the ’171 patent, and argued that a person of ordinary skill in the art
would have not combined the references. Id. at 19–20. In its Response,
AAD again does not address the disclosures of the references, and instead
argues that the references are not combinable because the combined
teachings would produce an inoperable device. PO Resp. 38–47. According
to AAD, to combine Sound Blaster with the teachings of Lucente would
require a substantial reconstruction and redesign of the elements in Lucente.
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Id. at 40–47. Thus, AAD concludes that the combination of Sound Blaster
and Lucente and any other prior art would not have rendered the challenged
claims obvious. Id. at 47. In addition, AAD moved to exclude Exhibit 1004
(Miller Declaration, Miller CV, and the Sound Blaster reference). Mot.
Exclude 1.
Sound Blaster discloses audio software with a graphical user interface
designed for organizing and playing back audio files. Ex. 1004, 2-1, 2-7.11
Sound Blaster also discloses the ability to group sound tracks into playlists.
Id. at 2-20–2-28, Fig. 2-8.
Lucente discloses a “pen-based computer with an integral flat panel
display and digitized screen.” Ex. 1005 1:3–4. The housing of Lucente
includes an audio input and output, processor, and memory. Id. at 7:39–49,
12:2–13. According to HTC, the hardware of Lucente is capable of running
the Sound Blaster software. Pet. 38.
Ozawa discloses a portable audio device that can download music
from a network service center and save audio files to a hard drive in the
device. Ex. 1006, 4:48–53. The Ozawa device has push-button controls on
its face for controlling the operation of the device, such as playing and
pausing music. Id. at 5:30–33.
Hawkins discloses a computing device in the form of a “combination
laptop and pad computer.” Ex. 1008, Abstract. HTC contends that Hawkins

11 HTC did not add page numbers to the Sound Blaster reference, as required
by our Rules. See 37 C.F.R. § 42.63(d)(2)(i). We refer to the page numbers
of the original Sound Blaster manual when citing the reference.
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discloses that the computing device has an on/off control, and that a person
of ordinary skill in the art would recognize the benefit of having an on/off
control. Pet. 42.
At oral hearing, AAD’s counsel did not concede that Sound Blaster,
Lucente, Ozawa, and Hawkins disclose all elements of the claims if
combined, but acknowledged that AAD’s briefs had provided no argument
on that point. Tr. 90–91. Specifically, AAD did not provide any evidence
or testimony contrary to the evidence and testimony provided by Petitioner
regarding the disclosures of Sound Blaster, Lucent, and Ozawa. Our
Scheduling Order in this case cautioned AAD that “any arguments for
patentability not raised in the [Patent Owner Response] will be deemed
waived.” Paper 7, 3. The Board’s Trial Practice Guide, furthermore, states
that the Patent Owner Response “should identify all the involved claims that
are believed to be patentable and state the basis for that belief.” Office
Patent Trial Practice Guide, 77 Fed. Reg. 48,756, 48,766 (Aug. 14, 2012)
(emphasis added). As the Board has stated, our governing statute and Rules
“clearly place some onus on the patent owner, once trial is instituted, to
address the material facts raised by the petition as jeopardizing patentability
of the challenged claims.” Johnson Health Tech Co. v. Icon Health &
Fitness, Inc., Case IPR2013-00463, slip op. at 12 (PTAB Jan. 29, 2015)
(Paper 41). By addressing only the combination of the references, AAD
conveyed to the Board and HTC that the only bases for its belief that the
challenged claims are patentable were (i) whether Sound Blaster and
Lucente were combinable and (ii) whether Sound Blaster is admissible.
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In our Decision to Institute, we concluded that HTC had made a
threshold showing that Sound Blaster, Lucente, Ozawa, and Hawkins taught
all the limitations of the challenged claims, sufficient for us to conclude that
there was a reasonable likelihood that HTC would prevail in showing that
the challenged claims were obvious over the combined references. Dec. 24.
We must now determine whether the preponderance of the evidence of
record supports a finding of obviousness. 35 U.S.C. § 316(e). Given
AAD’s waiver of argument that the combination of references does not teach
all elements of the challenged claims, the record now contains the same
arguments and evidence on that point as it did at the time of our Decision to
Institute. See 37 C.F.R. § 42.23(a). After careful consideration of the entire
record, including the Petition, Patent Owner’s Response, and all evidence
submitted by the parties, we find that the preponderance of the evidence of
record supports a finding that HTC has set forth how all limitations of the
challenged claims are taught by Sound Blaster, Lucente, Ozawa, and
Hawkins. Pet. 36–56; Ex. 1009 ¶¶ 162–213 (Schmandt declaration
including claim charts). We, therefore, turn to the two remaining issues on
this ground of unpatentability: AAD’s Motion to Exclude Sound Blaster,
and whether a person of ordinary skill would have had reason to combine
Sound Blaster, Lucente, Ozawa, and Hawkins.
a. Motion to Exclude Exhibit 1004
Exhibit 1004 contains two related documents: (1) the Declaration of
Kyle A. Miller, attesting to the public availability of the Sound Blaster
reference; and (2) the Sound Blaster reference itself. Mr. Miller testifies that
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Sound Blaster is a copy of a Sound Blaster 16 User Reference Manual he
received during the course of his employment at Creative Labs, “no later
than the early spring of 1995.” Ex. 1004 ¶ 19. According to Mr. Miller, his
employer provided him with commercial versions of Creative Labs’ most
popular products, including the Sound Blaster 16 Audio Card. Id. ¶ 12. Mr.
Miller testifies that the product he received included the User’s Manual, and
would have been the same documentation provided to a commercial
purchaser of the product. Id. ¶ 14.
AAD moves to exclude Exhibit 1004 on several grounds. Mot.
Exclude 1. Pursuant to our Rules, a motion to exclude evidence must be
filed to preserve any previously-made objections to evidence. 37 C.F.R.
§ 42.64(c). The motion must identify where in the record the objections
were made, and must explain the objections. Id.
We note that AAD does not identify where in the record its objections
to evidence were made prior to their being the basis of the Motion to
Exclude, in violation of Rule 42.64(c). Indeed, the Board is aware of AAD’s
prior objections only because they were quoted in HTC’s opposition to the
Motion to Exclude. For this reason, AAD’s Motion is procedurally
deficient, and may be denied on this basis alone.
Even if we were to overlook the procedural deficiency of the motion
itself, we would not exclude Exhibit 1004. First, AAD argues that the Miller
Declaration is hearsay. Mot. Exclude 4–5. It does not appear that AAD
previously made this objection, as required by our Rules. According to
HTC, the only hearsay-based objection made by AAD was that Exhibit B
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(the Sound Blaster reference itself) did not satisfy the business records
exception to the hearsay rule. Exclude Opp. 2. Furthermore, even if AAD
had preserved such an objection, we do not consider the Miller Declaration
to be hearsay, as it is not an out-of-court statement. In an inter partes
review, direct testimony is typically provided via affidavit, with cross-
examination taken via deposition. 37 C.F.R. § 42.53(a). In this respect,
testimony via affidavit before the Board is distinguishable from the
affidavits submitted in District Court cases cited by AAD, such as
Hilgraeve, Inc. v. Symantec Corp., 271 F. Supp. 2d 964 (E.D. Mich. 2003).
See Polaris Wireless, Inc. v. TruePosition, Inc., Case IPR2013-00323, slip
op. at 41 (PTAB Nov. 3, 2014) (Paper 62).
Second, AAD objects to the copyright date on the Sound Blaster
reference as hearsay. Mot. Exclude 5–8. Again, AAD has not established
that it previously made such an objection, other than the general objection to
“Exhibit B” as not being within the business records exception. This is
insufficient to put HTC on notice that AAD was specifically objecting to the
copyright date of the reference as hearsay. See 37 C.F.R. § 42.64(b)(1)
(“The objection must identify the grounds for the objection with sufficient
particularity to allow correction in the form of supplemental evidence.”). In
any event, we consider the exclusion of the copyright date to be moot, as we
do not rely on the copyright date to reach our determination that Sound
Blaster was publicly available. Mr. Miller’s testimony that Sound Blaster
was publicly available rests on his personal recollection, and merely cites the
copyright date as corroboration for that recollection. Ex. 1004, ¶ 17.
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Third, AAD contends that Sound Blaster is not within the business
records exception to the hearsay rule. Mot. Exclude 8. While it does appear
that AAD previously made this objection, the Motion does not cite to where
in the record the objection was made, as required by our Rule 42.64(c).
Nevertheless, the application of a hearsay exception is irrelevant, as Sound
Blaster is not offered for a hearsay purpose. As a prior art reference, Sound
Blaster is offered to show what information it would have conveyed to a
person of ordinary skill in the art; the truth of the contents of Sound Blaster
is not relevant to this inquiry. See Joy Techs., Inc. v. Manbeck, 751 F. Supp.
225, 233 n.2 (D.D.C. 1990), aff’d, 959 F.2d 226 (Fed. Cir. 1992); see EMC
Corp. v. Personal Web Techs., LLC, Case IPR2013-00085, slip op. at 66
(PTAB May 15, 2014) (Paper 73) (“[A] prior art document submitted as a
‘printed publication’ under 35 U.S.C. § 102(b) is offered simply as evidence
of what it described, not for proving the truth of the matters addressed in the
document.”).
Finally, AAD seeks to exclude Sound Blaster as not authenticated, as
there is no evidence to authenticate the reference “except the inadmissible
Miller Declaration.” Mot. Exclude 8–9. We have not found the Miller
Declaration to be inadmissible, however. To authenticate an item of
evidence, a party must “produce evidence sufficient to support a finding that
the item is what the proponent claims it is.” Fed. R. Evid. 901(a). The
Miller Declaration provides sufficient evidence to support the finding that
Sound Blaster is what HTC contends it to be: a document distributed to the
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public with the commercially available version of the Sound Blaster 16
Audio Card.
For these reasons, even if AAD’s Motion to Exclude were
procedurally proper, we would not exclude Exhibit 1004, including the
Sound Blaster reference, from the record.
b. Combinability of References
HTC contends that a person of ordinary skill in the art would have had
reason to combine Sound Blaster, Lucente, Ozawa, and Hawkins. Pet. 41–
42. First, HTC argues that the references pertain to personal computing
devices with similar hardware, for similar purposes of reproducing audio.
Id. at 41. In addition, HTC argues the devices of Lucente, Ozawa, and
Hawkins are directed to portable devices, and HTC asserts that a person of
ordinary skill in the art would have combined the software of Sound Blaster
with these devices to “improv[e] multimedia user experience.” Id. at 41–42.
To the contrary, AAD argues that combining Sound Blaster with
Lucente would have been outside the level of ordinary skill at the time of the
invention. PO Resp. 43–44. AAD first focuses on hardware
incompatibilities between the tablet computer of Lucente and the software of
Sound Blaster. Id. Citing the McAlexander Declaration, AAD argues that
“[t]he amount of skill required to make the Lucente device compatible with
the Sound Blaster software would substantially exceed the level of ordinary
skill.” Id. at 38. Mr. McAlexander testifies that modification of the Lucente
computer to run Sound Blaster would include such drastic steps as “redesign
of the battery and thermal management within the housing to provide the
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designed battery operating time while preventing overheating of the internal
circuits” (Ex. 2006 ¶ 25) and redesign of the “entire interface structure of the
Sound Blaster 16 audio card . . . from an ISA configuration to a different bus
standard, including firmware re-write to conform to the different bus
protocol.” Id. ¶ 27.
Mr. McAlexander also testifies that the Sound Blaster software
required a Windows 3.1 operating system, which allegedly was incompatible
with the “pen-based computer” disclosed in Lucente. Id. ¶ 28. For example,
Mr. McAlexander points out Lucente’s recitation of the ability to rotate the
display to permit either right-handed or left-handed operation, and states that
such a functionality was not provided in Windows 3.1. Id. ¶ 30.
In response, HTC argues that AAD focuses too heavily on the
physical combinability of the devices disclosed in the references, as opposed
to whether the teachings of the references would be combined. Pet. Reply
17–18. HTC submits the testimony of Mr. Schmandt, who testifies that a
person of ordinary skill in the art would have recognized that the
functionality of the Sound Blaster software (such as storing and managing
audio files, including making playlists) would provide similar benefits in a
portable touchscreen computer, such as the one described in Lucente. Ex.
1009 ¶ 158. The disclosures of Sound Blaster and Lucente, according to Mr.
Schmandt, would allow a person of ordinary skill in the art to construct a
device as claimed in the ’171 patent. Ex. 1014 ¶ 52. Mr. Schmandt also
addresses Mr. McAlexander’s opinion that a person of ordinary skill in the
art would have been unable to combine the computer of Lucente with the
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software of Sound Blaster, and testifies that a person of ordinary skill would
have both the knowledge and a reason to combine the teachings of these
references. Id. ¶¶ 54–65.
In our view, HTC’s proposed analysis better comports with the
“expansive and flexible approach” to obviousness set forth by the Supreme
Court in KSR. “The test for obviousness is not whether the features of a
secondary reference may be bodily incorporated into the structure of the
primary reference.” In re Keller, 642 F.2d 413, 425 (CCPA 1981). Our
inquiry is, therefore, not “whether the references could be physically
combined but whether the claimed inventions are rendered obvious by the
teachings of the prior art as a whole.” In re Etter, 756 F.2d 852, 859 (Fed.
Cir. 1985) (en banc).
Based on the combination of references proposed by HTC, Mr.
Schmandt testifies that a person of ordinary skill in the art would have
recognized the advantages of Sound Blaster’s functionality, and sought to
incorporate those features into Lucente. Ex. 1009 ¶ 158 (“[A] person of
ordinary skill in the art would be motivated to combine a system with the
flexibility, portability, and ease of use of Lucente with the audio
management capabilities of Sound Blaster.”); id. ¶ 160 (“[I]t would be
obvious to design a system with physical (e.g. push-button) controls to carry
out the various functions designed by Sound Blaster, particularly in view of
Lucente and Ozawa.” (emphasis added)). The record reflects that such a
modification would not have been outside the level of ordinary skill, which
both experts define similarly. Ex. 1009 ¶ 25 (Schmandt: at least a bachelor’s
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degree in electrical engineering, computer science, or equivalent, and 1–3
years of experience in designing and programming consumer electronic
devices); Ex. 2006 ¶ 8 (McAlexander: bachelor’s degree in electrical
engineering or computer engineering, and at least two years of experience in
the design of audio systems). This level of skill is also reflected by the prior
art of record. See Okajima v. Bourdeau, 261 F.3d 1350, 1355 (Fed. Cir.
2001). AAD’s focus on whether the Sound Blaster hardware sound card
could be installed on the Lucente device, or whether the Sound Blaster
software could run on Lucente’s operating system, ignores that a person of
ordinary skill is a “person of ordinary creativity, not an automaton.”
KSR, 550 U.S. at 421.
It would not have been outside the level of ordinary skill in the art, as
defined by both experts, to modify the device of Lucente to have the
functionality described in Sound Blaster—including grouping and ordering
songs—as well as the ability to download songs as described in Ozawa and
the on/off control of Hawkins. We, therefore, find that a person of ordinary
skill in the art would have had reason to combine the disclosures of Sound
Blaster, Lucente, Ozawa, and Hawkins and would have had a reasonable
expectation of success in doing so.
c. Objective Indicia of Nonobviousness
As discussed above, we have considered AAD’s evidence of objective
indicia of nonobviousness, but conclude that the evidence is insufficient to
support a conclusion of nonobviousness.
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d. Conclusion on Obviousness
For the foregoing reasons, HTC has proven by a preponderance of the
evidence that Sound Blaster, Lucente, Ozawa, and Hawkins teach all
elements of challenged claims 1, 2, 5, 6, 7, 14, 17, 20, 26, 28, 37, 40, 42, 43,
and 45–48, and that a person of ordinary skill in the art would have had
reason to combine the disclosures. Furthermore, we conclude that such a
combination would have been within the level of ordinary skill in the art, as
evidenced by the prior art of record. We, therefore, conclude that claims 1,
2, 5, 6, 7, 14, 17, 20, 26, 28, 37, 40, 42, 43, and 45–48 would have been
obvious at the time of the invention, and thus are unpatentable under
35 U.S.C. § 103.
3. Alleged Obviousness of Claim 23 Over Sound Blaster,
Lucente, and Ozawa, Hawkins, and Martin
HTC asserts an additional ground of unpatentability, based on the
combination of Sound Blaster, Lucente, Ozawa, and Hawkins with Martin.
Pet. 56–57. AAD does not present additional arguments on this ground,
relying only on its argument that Sound Blaster, Lucente, Ozawa, and
Hawkins are not properly combinable. PO Resp. 48. As discussed above,
we do not agree with AAD that a person of ordinary skill in the art would
not have combined Sound Blaster and Lucente, and therefore, AAD’s
arguments against this additional ground fails for the same reasons.
Claim 23 depends from claim 1 and further requires that at least one
of the touch-operable controls is touchable to sort a list of sound tracks
which is displayed on the display, wherein all of the sound tracks in the list
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and their names are stored in the non-volatile memory. HTC relies on
Martin to teach sorting songs alphabetically by artist or title, and argues that
the ability to do so permits a user to quickly identify a song from a large
database. Pet. 56–57. HTC contends, therefore, a person would have
combined Martin with the disclosures of Sound Blaster, Lucente, Ozawa,
and Hawkins. Id. We find that Martin discloses providing on a display an
index of available songs, sorted alphabetically either by artist or title. Ex.
1007, 7:22–25. We also credit Mr. Schmandt’s testimony that a person of
ordinary skill in the art would have had reason to include this functionality
in the combination of Sound Blaster, Lucente, and Ozawa. Ex. 1009 ¶ 216.
We find that this additional limitation is, therefore, disclosed by Martin, and
the remaining limitations of claim 23 are disclosed by Sound Blaster,
Lucente, Ozawa, and Hawkins, as discussed above.
C. Patentability of Proposed Substitute Claims
In an inter partes review, amended claims are not added to the patent
as of right, but rather must be proposed as a part of a motion to amend.
35 U.S.C. § 316(d). As moving party, the patent owner bears the burden of
proof to establish that it is entitled to the relief requested—namely, addition
of the proposed claims to the patent. 37 C.F.R. § 42.20(c). A patent owner
must meet the requirements of 37 C.F.R. § 42.121, and demonstrate the
patentability of the proposed substitute claims. Idle Free Sys., Inc. v.
Bergstrom, Inc., Case IPR2012-00027 (PTAB June 11, 2013) (Paper 26,
“Idle Free”) (informative); see also Microsoft Corp. v. Proxyconn, Inc., 789
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F.3d 1292, 1308 (Fed. Cir. 2015) (“Assuming an amendment is
appropriately responsive to the grounds of unpatentability involved in the
trial, the patentee must still go on to show that it is entitled to its substitute
claim.”).
AAD’s Motion to Amend proposes to substitute new claim 49 for
claim 1, contingent on claim 1 being held unpatentable. Mot. Amend 2.
AAD, however, concedes that its Motion only addresses unpatentability over
the Nathan obviousness ground.12 Id. at 8. In other words, “[i]f the Board
finds that claim 1 is unpatentable due to Sound Blaster and/or Lucente, th[e]
Motion need not even be considered by the Board.” Id. As set forth above,
we have found claim 1 unpatentable over both asserted grounds. As AAD
acknowledges, we need not consider its Motion.
Nevertheless, we note that even absent AAD’s statement, the Motion
to Amend would be denied on the merits. Proposed claim 49 includes
several limitations not present in claim 1:
wherein the personal digital stereo audio player is configured such
that after sound tracks are stored in the non-volatile memory:
a session is addable using at least one touch-operable control on
the housing;
the session is nameable using at least one touch-operable
control on the housing;

12 We need not address whether the Motion, by intentionally not responding
to an instituted ground of unpatentability, complies with our Rules. See 37
C.F.R. § 42.121(a)(2)(i) (“A motion to amend may be denied where . . . [t]he
amendment does not respond to a ground of unpatentability involved in the
trial.”).
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sound tracks are addable to the session using at least one touch-
operable control on the housing;
sound tracks are deleteable from the session using at least one
touch-operable control on the housing;
wherein an order of the sound tracks in the session is
customizable using at least one touch-operable control on
the housing;
wherein the session is re-nameable using at least one touch-
operable control on the housing; and
wherein the session is deleteable using at least one touch-
operable control on the housing.
Id. at 16. To provide written description support for these changes, AAD
cites to the disclosure of US Patent Application No. 12/855,510 (Ex. 2009),
filed August 12, 2010, which issued as the ’171 patent. Id. at 3–6.
Therefore, even if we were to grant the Motion to Amend, the proposed
substitute claims would only be entitled to a priority date of August 12,
2010. See 37 C.F.R. § 42.121(b) (“A motion to amend claims must . . . set
forth: . . . (2) The support in an earlier-filed disclosure for each claim for
which benefit of the filing date of the earlier filed disclosure is sought.”)
A motion to amend is also required to set forth a construction for any
new terms introduced via amendment. See Idle Free, slip op. at 7. In
particular, AAD introduces the term session to the claims. AAD points out
that the specification of the ’171 patent uses session in several locations, and
proposes that the term be construed synonymous with “playlist,” meaning
“an electronic file containing a list of audio or video files that can be played
back on an MP3 player or other media player in a particular sequence.”
Mot. Amend. 7. HTC contests this construction, noting that the specification
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of the ’171 does not use the term “playlist,” and arguing that AAD gives
insufficient reason to link the two terms as synonyms. Amend Opp. 3. Even
adopting AAD’s proffered construction, however, we would not grant the
Motion to Amend, as AAD has not demonstrated patentability of claim 49 or
any of the proposed dependent claims.
In a motion to amend, a patent owner has the burden “to show
patentable distinction over the prior art of record and also prior art known to
the patent owner.” Idle Free, slip op. at 7. We have held that “prior art of
record” refers to material art in the prosecution history of the patent, material
art of record in the current proceeding before the Board, and material art of
record in any other proceeding before the Office involving the patent. See
MasterImage 3D, Inc. v. RealD Inc., Case IPR2015-00040, slip op. at 2
(PTAB July 15, 2015) (Paper 42). AAD’s Motion, however, does not
discuss any of the prior art of record other than the Nathan references.
Nor does AAD discuss the prior art known to AAD, beyond that
already of record. The Board has stated that this requires “no more than the
material prior art that Patent Owner makes of record in the current
proceeding pursuant to its duty of candor and good faith to the Office under
37 C.F.R. § 42.11.” Id. at 3. In considering this duty of candor and good
faith, patent owners should emphasize the limitations added to the proposed
claim. Id. AAD’s Motion fails to make any such prior art of record, even
though it acknowledges that another patent in the same family as the ’171
patent “had hundreds of items of prior art cited against it.” Mot. Amend 11.
AAD merely makes the statement that “[a]s far as Patent Owner knows,
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none of the features now being claimed were previously known or disclosed
in any of the prior art of record, or in any other prior art known to Patent
Owner.” Id. at 12.
AAD argues that “[t]here are almost 200 references made of record in
the AAD patent family. AAD cannot be expected to discuss them all in its
Motion.” Amend Reply 3. Even if the large number of prior art references
cited in related applications may excuse AAD’s failure to discuss one or two
material references, however, it does not excuse AAD from, at the very
least, making a good faith attempt to determine whether any prior art known
to it discloses the additional limitations introduced in the proposed amended
claim. As discussed above, the earliest priority date supported by the
Motion to Amend is August 12, 2010. AAD, however, does not discuss the
state of the art as of that date, or provide any prior art references beyond
those already of record that might be material to the added limitations. A
generalized statement that “none of the features now being claimed were
previously known or disclosed in any of the prior art of record, or in any
other prior art known to Patent Owner” (Mot. Amend 12) is not sufficient to
carry AAD’s burden. See Idle Free, slip op. at 7 (“Some representation
should be made about the specific technical disclosure of the closest prior art
known to the patent owner, and not just a conclusory remark that no prior art
known to the patent owner renders obvious the proposed substitute
claims.”).
We, therefore, conclude that even if the Motion to Amend is evaluated
on its merits, AAD has not met its burden of demonstrating that it is entitled
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to the relief requested. In particular, the Motion fails to address the
patentability of the claims over the prior art of record, and fails to address
the patentability of the claims over the material prior art known to AAD.
Accordingly, the Motion to Amend is denied.
III. CONCLUSION
We conclude that HTC has demonstrated, by a preponderance of the
evidence, that claims 1, 2, 5, 6, 7, 14, 17, 20, 23, 26, 28, 37, 40, 42, 43, and
45–48 of the ’171 patent are unpatentable under 35 U.S.C. § 103, as having
been obvious over the following combinations of prior art references:
Claims 1, 2, 5, 6, 7, 14, 17, 20, 26, 28, 37, 40, 42, 43, and 45–48:
Nathan ’259 and Nathan ’255;
Claims 1, 2, 5, 6, 7, 14, 17, 20, 26, 28, 37, 40, 42, 43, and 45–48:
Sound Blaster, Lucente, Ozawa, and Hawkins; and
Claim 23: Sound Blaster, Lucente, Ozawa, Hawkins, and Martin.

IV. ORDER
Accordingly, it is
ORDERED that claims 1, 2, 5, 6, 7, 14, 17, 20, 23, 26, 28, 37, 40, 42,
43, and 45–48 of U.S. Patent No. 7,933,171 B2 are unpatentable;
FURTHER ORDERED that Patent Owner’s Motion to Exclude is
denied;
FURTHER ORDERED that Patent Owner’s Motion to Amend is
denied as to proposed substitute claims 49–67.
FURTHER ORDERED that, pursuant to 35 U.S.C. § 318(b), upon
expiration of the time for appeal of this decision, or the termination of any
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such appeal, a certificate shall issue canceling claims 1, 2, 5, 6, 7, 14, 17, 20,
23, 26, 28, 37, 40, 42, 43, and 45–48 in U.S. Patent No. 7,933,171 B2; and
FURTHER ORDERED that, because this is a final decision, parties to
the proceeding seeking judicial review of the decision must comply with the
notice and service requirements of 37 C.F.R. § 90.2.
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For Petitioner:
Bing Ai
Hwa C. Lee
Thomas N. Millikan
Matthew C. Bernstein
Evan S. Day
PERKINS COIE LLP
Ai-ptab@perkinscoie.com
HLee@perkinscoie.com
TMillikan@perkinscoie.com
MBernstein@perkinscoie.com
EDay@perkinscoie.com

For Patent Owner:
James R. Foley
Timothy M. McCarthy
John S. Paniaguas
CLARK HILL PLC
jfoley@clarkhill.com
tmccarthy@clarkhill.com
jpaniaguas@clarkhill.com