Koninklijke Philips N.V.

Patent Trials and Appeals Board

Dec 23, 2021

IPR2021-00547 (P.T.A.B. Dec. 23, 2021)

Trials@uspto.gov Paper 12
571-272-7822 Date: December 23, 2021

UNITED STATES PATENT AND TRADEMARK OFFICE

BEFORE THE PATENT TRIAL AND APPEAL BOARD

TCL INDUSTRIES HOLDINGS CO., LTD.,
Petitioner,
v.
KONINKLIJKE PHILIPS N.V.,
Patent Owner.

IPR2021-00547
Patent 9,590,977 B2

Before KEVIN F. TURNER, STACEY G. WHITE, and
RUSSELL E. CASS, Administrative Patent Judges.
CASS, Administrative Patent Judge.
DECISION
Denying Petitioner’s Request for Rehearing of Decision Denying Institution
of Inter Partes Review
37 C.F.R. § 42.71(d)

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I. INTRODUCTION
A. Background
Petitioner TCL Industries Holdings Co., Ltd. (“Petitioner”) filed a
Request for Rehearing under 37 C.F.R. § 42.71(d) (Paper 11 (“Req. Reh’g)).
Petitioner’s Request for Rehearing seeks reconsideration of our Decision
Denying Institution of Inter Partes Review of U.S. Patent No. 9,590,977 B2
(Ex. 1001, “the ’977 patent”). Paper 10 (“Dec.”). For the reasons set forth
below, Petitioner’s Request is denied.
II. BACKGROUND
Petitioner filed a Petition requesting inter parties review of claims 22–
31 (the “challenged claims”) of the ’977 patent. Paper 1 (“Pet.”). The
Petition asserted that independent claim 22 is unpatentable over EP 1045585
A1 to Maillard et al. (Ex. 1004, “Maillard”), in view of WO 97/39553 A1 to
Davis (Ex. 1005, “Davis”) and WO 02/35036 A1 to Lundkvist (Ex. 1006,
“Lundkvist”). Pet. 1. In our Decision Denying Institution, we determined
that Petitioner had failed to articulate sufficient reasoning for combining
Maillard, Davis, and Lundkvist, and therefore, had not established a
reasonable likelihood that claim 22 was unpatentable. Dec. 19–22. We also
determined that Petitioner had failed to establish a reasonable likelihood that
the remaining dependent claims were unpatentable. Id. at 22–23.
III. STANDARD OF REVIEW
A party requesting rehearing bears the burden of showing that the
decision should be modified, and “[t]he request must specifically identify all
matters the party believes the Board misapprehended or overlooked.” 37
C.F.R. § 42.71(d). Institution of an inter partes review is authorized by
statute only when “the information presented in the petition . . . and any
response . . . shows that there is a reasonable likelihood that the petitioner
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would prevail with respect to at least 1 of the claims challenged in the
petition.” 35 U.S.C. § 314(a) (2018). When considering a request for
rehearing of a decision whether to institute an inter partes review, the Board
reviews its decision for an abuse of discretion. 37 C.F.R. § 42.71(c). An
abuse of discretion occurs when a “decision [i]s based on an erroneous
conclusion of law or clearly erroneous factual findings, or . . . a clear error of
judgment.” PPG Indus. Inc. v. Celanese Polymer Specialties Co., 840 F.2d
1565, 1567 (Fed. Cir. 1988). “It is not an abuse of discretion to have made
an analysis or conclusion with which a party disagrees,” and “mere
disagreement with the Board’s analysis or conclusion is not a proper basis
for rehearing.” EMC Corp. v. PersonalWeb Techs., LLC, IPR2013-00085,
Paper 29 at 4 (PTAB June 5, 2013).
IV. ANALYSIS
In its Request for Rehearing, Petitioner makes two arguments. First,
Petitioner argues that the Petition identified sufficient rationale to combine
based on Davis’s teaching to use proximity awareness in smart card systems.
Req. Reh’g 2. Second, Petitioner argues that the Petition identified
sufficient rationale to combine based on risk of unauthorized redistribution
outside the authorized local network. Id. at 9. We address these arguments
in turn below.
A. Motivation to Combine Based on Davis’s Teaching to Use Proximity
Awareness in Smart Card Systems
In the Petition, Petitioner argued that one of ordinary skill would have
been motivated to combine Maillard and Davis because Davis recognizes the
vulnerability of smartcard systems when a “user leaves accesses his or her
personal computer and leaves the personal computer unattended for some
duration without removing the card or disabling the personal computer
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during his or her absence,” thereby leaving the personal computer exposed
to access by unauthorized users. Pet. 31 (quoting Ex. 1005, 2:28–3:19). In
our Decision, we determined that Petitioner’s articulated rationale failed to
sufficiently explain why this problem would apply to Maillard’s system.
Dec. 19–20. In particular, we explained that the record did not sufficiently
show why in Maillard’s system it would have been a problem for the user to
leave the security module unattended while connected to the DVD player.
Id.
Petitioner contends that we misapprehended or misevaluated its
rationale to combine because Davis is not limited to a user accessing a
computer, but rather “teaches that its technique is an improvement for any
electronic device that uses a smart card for secure access, which Maillard’s
DVD player does.” Req. Reh’g 6–7. Additionally, Petitioner contends that
Maillard is not limited to a DVD player application but rather “discloses that
its techniques are relevant to the communication of protected content
between various types of devices,” including “software content on a hard
disk of a computer.” Id. at 7. “Hence,” Petitioner argues, “while the
rationale to combine disclosed in Davis and relied on in the Petition is itself
sufficient to demonstrate a rationale to modify the DVD player embodiment
in Maillard, the rationale to combine is further supported for Maillard’s
broader disclosure of other electronic devices.” Id. at 8.
We are not persuaded by Petitioner’s arguments. Although Petitioner
now argues that Davis is applicable to any electronic device, Petitioner did
not make that argument in the Petition, but rather relied on Davis’s teaching
that smart card systems “can be vulnerable when ‘the user accesses his or
her personal computer and leaves the personal computer unattended for
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some duration without removing the card or disabling the personal computer
during his or her absence.’” Pet. 31 (quoting Ex. 1005, 2:28–3:19). Indeed,
the portions of the Petition that the Request for Rehearing points to as
making this argument (Id. at 12:17–13:1, 26:4–10) are taken from the
background sections describing the state of the prior art and the Davis
reference, not from the section arguing that it would have been obvious to
combine the references (Id. 30–33). Similarly, Petitioner’s argument that
Maillard could be combined with Davis because Maillard’s technique is
relevant to other electronic devices, including software content on a
computer hard disk, was not made in the Petition. See id. at 30–33. We
cannot have misapprehended or overlooked points and arguments that
Petitioner never made in the Petition.
Moreover, even if we consider these newly-raised arguments,
Petitioner’s evidence still falls short. The quoted portion of Davis extends
its teachings to “a peripheral to the computer (printer, mass storage device,
etc.), door locking mechanisms (i.e., garage door opener, electronic door
locks) and the like.” Ex. 1005, 7:13–19, quoted in Req. Reh’g 6–7. These
are all situations, like the computer in Davis’s preferred embodiment, where
the device being protected is in a location where it is exposed to many
people who might not be authorized to access it, leaving it vulnerable when
a user accesses the device and then leaves it unattended for a period of time.
See Ex. 1005, 2:28–3:19. In this situation, Davis’s proximity measurement
prevents access by such unauthorized persons by restricting access to an
authorized user who is in close physical proximity to the device. Maillard,
on the other hand, has a different purpose, namely “provid[ing] secure
communication of data between devices” in a digital audiovisual system “to
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prevent the unauthorized copying and distribution of digitally recorded
data.” Ex. 1004 ¶ 78. Maillard says nothing about preventing unauthorized
users from accessing a device after the authorized user accesses it and leaves
it unattended, which is the purpose of Davis’s proximity detection. Thus,
Petitioner fails to adequately show why one of ordinary skill would have
applied Davis’s teaching to Maillard’s system, which has a different context
and purpose.
Petitioner’s argument that Maillard includes a “broader disclosure of
other electronic devices” besides a DVD player is also unavailing. The
pertinent portion of Maillard states that the invention also may be applied
“to the playing of exclusive audio information subsequently recorded on a
DAT or minidisc recorder or even to the communication of software
recorded on the hard disc of a computer.” Ex. 1004 ¶ 74. Like the DVD
player preferred embodiment, these are all examples of providing secure
communication between two devices physically connected together to
prevent unauthorized copying and distribution. Petitioner fails to adequately
show why one of ordinary skill would have found Davis’s token and
proximity detection to be useful in these alternative embodiments of
Maillard’s system.
B. Motivation to Combine Based on the Risk of Unauthorized
Redistribution Outside the Authorized Local Network
In the Petition, Petitioner argued that one of ordinary skill would have
“recognized that Maillard’s technique, which was described using an
example home network using IEEE 1394 communication link . . . could be
susceptible to attacks that would allow devices outside of the home network
to infiltrate the home network.” Pet. 31 (citing Ex. 1004 ¶¶ 53, 58; Ex. 1003
¶¶ 138–142 (Nielson declaration)).
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In our Institution Decision, we determined that this argument lacked
sufficient evidentiary support. Dec. 20–22. We noted that Petitioner did not
point to any statements in the prior art suggesting that the risk of an
unauthorized person breaking into a system such as Maillard’s would have
been recognized as a problem by one of ordinary skill. Id. at 21 (citing Pet.
31–32; Ex. 1003 ¶¶ 131–135). We also explained that Dr. Nielson failed to
provide evidence to support his assertions that “[i]t was known to a POSITA
that data signals of one communication type, such as IEEE 1394 as
mentioned in Maillard, can be vulnerable to attacks, where signals could be
adapted and retransmitted over more traditionally long distance mechanisms,
such as Ethernet,” or (2) “[a] POSITA would readily comprehend that
Maillard’s security module for device authorization and authentication in a
home network could be exfiltrated to a remote location.” Id. (citing Pet. 30–
33, 56–61; Ex. 1003 ¶¶ 131–141 (alterations in original)).
We further noted in our Institution Decision that Patent Owner had
introduced evidence that an “IEEE bus link” would have been understood to
be a physical cable that connects two devices together. Dec. 21–22 (citing
Ex. 1004 ¶ 53; Ex. 2001, 94). We agreed with Patent Owner that the
Petition did not sufficiently explain why adding a distance measurement
between Maillard’s security module and one of the other devices would
enhance security. Id. at 22.
In its Request for Rehearing, Petitioner argues that we
misapprehended Dr. Nielson’s explanation because we made an improper
assumption that “unauthorized distribution can only occur due to external
actors.” Req. Reh’g 12. Petitioner asserts that “[u]nauthorized distribution
could just as easily be performed by a user in the home transmitting the
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content outside the home network without authorization,” but “because
Maillard’s system is not able to determine whether the target device is
actually in the home network, ‘Maillard’s security module would enable the
DVD player to transmit to another authorized TV anywhere in the world so
long as the security module is connected in this way.’” Id. at 12–13 (citing
Ex. 1003 ¶ 141).
We are not persuaded by Petitioner’s argument on rehearing. The
Petition merely asserted that one of ordinary skill would have recognized
that Maillard’s technique “could be susceptible to attacks that would allow
devices outside of the home network to infiltrate the home network,” and
thus, argued that it would have been obvious to use Davis’s proximity
detection. Pet. 31 (emphasis added). The Petition did not assert that the risk
of a person inside the home transmitting protected content from a DVD to
an outside location without authorization would have provided motivation to
add Davis’s proximity detection to Maillard. Id. at 31–32.
Additionally, Petitioner does not provide any more evidentiary
support that one of ordinary skill would have recognized the risk of
unauthorized transmission from a person inside the home to an external
location than it does that one of ordinary skill would have recognized the
risk of unauthorized transition due to an external actor infiltrating the
system. In this regard, neither Petitioner nor Dr. Nielson point to any
statements in Maillard, Davis, Lundkvist, or any other reference in the
record indicating that one of ordinary skill would have recognized this risk
of unauthorized transmission from a person inside the home as a problem
with the Maillard system. Moreover, as we explained in the Institution
Decision, Patent Owner introduces evidence that the IEEE 1394 bus link
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described in Maillard, was a physical cable connecting two devices together
(Pet. 21 (citing Ex. 1004 ¶ 53; Ex. 2001, 94)), and Petitioner does not
sufficiently explain why, when the devices are physically connected, adding
a distance measurement between the security module and one of the other
devices would enhance security.
Furthermore, even if one of ordinary skill had recognized the risk that
a person inside the home could make an unauthorized transmission to a TV
outside the home, neither Petitioner nor Dr. Nielson sufficiently show why
one of ordinary skill in the art would have been motivated to look to Davis’s
proximity-aware technique to solve this problem. As discussed above,
Davis uses proximity of the user to the computer for authentication because
the computer is in a location (such as a business) that is accessible to
multiple unauthorized users. See Ex. 1005, 2:28–3:19. Maillard’s DVD
player, by contrast, is located in the home and, presumably, not readily
accessible by unauthorized users in the same manner as Davis’s computer.
Therefore, there is insufficient evidence in the present record that of
ordinary skill would have looked to Davis’s proximity authorization
technique to improve security in Maillard’s home DVD system.
V. CONCLUSION
The Request for Rehearing does not demonstrate that the Institution
Decision misapprehended or overlooked any matters, or that we abused our
discretion in arriving at the conclusions set forth in the Decision.
VI. ORDER
In consideration of the foregoing, it is hereby:
ORDERED that the Request for rehearing is denied.

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For PETITIONER:

Babak Tehranchi
John Schnurer
Bing Ai
Kevin Patariu
Yun Lu
PERKINS COIE LLP
tehranchi-ptab@perkinscoie.com
schnurer-ptab@perkinscoie.com
ai-ptab@perkinscoie.com
patariu-ptab@perkinscoie.com
lu-ptab@perkinscoie.com

For PATENT OWNER:

William Meunier
Michael Renaud
Derek Constantine
MINTZ, LEVIN, COHN, FERRIS, GLOVSKY AND POPEO, P.C.
wameunier@mintz.com
mtrenaud@mintz.com
deconstantine@mintz.com