MONUMENT PEAK VENTURES, LLC v. TOSHIBA AMERICA BUSINESS
Oral Argument — 12/08/2021 · Case 21-1052 · 36:53
0:00
Judge Lourie
We have two cases on the calendar this morning, one from a district court and a veteran's appeal that's submitted on the briefs and will not be argued.
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Our only argued case is 2021-1052, Monument Peak Ventures v. Toshiba, America.
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Mr. Edmonds.
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Appellant Attorney (John J. Edmonds)
Oops.
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Judge Lourie
That is a problem.
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That ought to be fixed.
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Please proceed.
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Appellant Attorney (John J. Edmonds)
Good morning, Your Honors, and may it please the court.
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I'm here on behalf of the appellant, Monument Peak Ventures.
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I'm going to refer to them as MPV for short.
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And this opinion by the district court should be reversed for five fundamental reasons.
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The first reason is that MPV's second amended complaint,
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had specific, non-conclusory, plausible, factual details about technical problems, technical solutions to those problems,
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inventive concepts, the unconventionality of those solutions, and how human processes weren't automated.
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Those facts should have been credited by the district court on a Rule 12 motion.
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This is on a Rule 12B motion.
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Judge Lourie
We can read the claims.
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And they talk about transferring images, storing them, deleting them.
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It looks all abstract.
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Appellant Attorney (John J. Edmonds)
Are you referring to a particular patent, Your Honor?
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Which would you want me to address that remark to?
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Judge Lourie
Well, all of them.
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Appellant Attorney (John J. Edmonds)
Okay.
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Well, that's about the opinion we got from the district court in the sense that it didn't,
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the district court did not really look at it.
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It looked at the limitations.
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It talked about the patents, and it didn't dig into the limitations.
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So I'll start with the 064 and the 095, which we'll discuss together.
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Judge Prost
Well, he talked about the claims.
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He didn't talk about just the patents.
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He did talk about the claims, and he called them representative claims.
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Now, you may sort of take a little issue with that, but he talked about the claims, not just the patents, right?
2:31
Appellant Attorney (John J. Edmonds)
The district court talked about representative claims,
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but in his actual ALICE Step 1 and Step 2 analysis, he just referred to the patent.
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In each instance, he just referred to the patent.
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And he drew a generalization of the patent, and that's what he used as his benchmark for 101, not the claims.
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That's just not simply what his analysis bears out.
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Judge Clevenger
I hear you talking, sir, but from my perspective, at least since 1985,
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in this court, the understanding has been that we pass on judgments, not on opinions.
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And so the fact that the judge might not have said the word claim when he's talking about what he finds to be the abstract idea,
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he clearly has looked at a representative claim in his opinion.
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And I realize that you've made some arguments that you think that he—
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chose the wrong representative claim,
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but that's a different issue from whether or not the representative claim is sufficient
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to allow us to review what the judge's decision, as opposed to his opinion,
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was with respect to whether the representative claim was drawn to an abstract idea.
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Appellant Attorney (John J. Edmonds)
That speaks to the issue, and we raised the real-time data case in particular,
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that in our view, the district court didn't—
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didn't provide a reviewable opinion.
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Judge Clevenger
Right. Well, that's—I mean, we—it's clearly, too, that we've had on several times
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have expounded on the fact that we need to have a decision that we can effectively review.
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And when you combine that notion with the notion that we're more concerned with the—
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with the correctness of the decision, as opposed to perhaps some words in an opinion,
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what we then do is look at the entire record.
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And in a case where there's a judgment based on the pleadings,
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we look at the arguments that were made in the opposing briefs.
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And I went back and read the briefs that were supplied by you and your adversary to the judge,
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and each of those briefs had extensive discussion of the case law.
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You had your view of what you—cases that you selected, you believe,
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supported your point of view as to why they represented.
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Presented claims weren't drawn to abstract ideas,
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and your adversary looked at other cases and cited specific language from those cases.
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So we have a body of material that was before the district court judge,
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and we know from his decision that he preferred—he found your adversary's arguments more convincing
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as to whether or not these claims are drawn to abstract ideas.
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Well—
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Well—
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Well—
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Well—
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In part, it seems maybe you can correct me or guide me helpfully to your cause, to your side,
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but it seems to me our first task is to decide whether we have enough information in front of us
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to review the judge's decision that each of the representative claims were drawn—
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in each patent were drawn to abstract ideas.
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And if so, did the judge formulate the correct abstract idea?
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And if the answer to that is yes from our point of view, then you move to step two of Alice.
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So—
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So I want to sort of see where your—where the grovement of your argument is.
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Appellant Attorney (John J. Edmonds)
Well, I think the grovement of our argument is that the claims were wrongly invalidated or found patent ineligible.
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And so if you—if the court feels like it has enough from the record to do its own—
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to do its own de novo review, then we should talk about the merits and not—
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and I'm fine moving on to that and start talking about these—each of these patents.
6:45
Judge Clevenger
Well, I'm trying to be helpful to you in sort of framing because you've got, you know, five patents here,
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although the 064 and the 095 look like they're pretty much the same.
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I mean, you started with the 064 and the 095.
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The 064, the judge said this is an abstract method for file management.
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You could also—
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You could also look at the—at the claims as saying what it's doing is storing, transferring, and deleting images.
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And so I've asked you why—why is the method for file management,
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which is basically storing, transferring, and deleting images,
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why isn't that an abstract idea under—under our precedent that deals with information transfer, storing, modulating information?
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And we have manifolds.
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We have multiple cases cited by your adversary that say we treat those kinds of claims as drawn-to-abstract ideas.
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Appellant Attorney (John J. Edmonds)
Well, the—the question—so you're asking, I think, about Alice Step 1.
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Judge Clevenger
Yeah, that's where we're talking.
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Right, right.
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Appellant Attorney (John J. Edmonds)
So with—with—with respect to Alice Step 1, our—what the court should consider is that this provides a technical solution to a technical problem.
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And the technical—
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The technical solution is that the—the camera itself keeps track of which images have been successfully transferred.
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And that juxtaposes—
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Judge Lourie
But—but we look at claims, and we look at claim language.
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And if each of the operative words in the claims reflects an—an abstract idea, then isn't that conclusive?
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Appellant Attorney (John J. Edmonds)
No.
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No, I think that this court would ask if it's—if—if it is a—provides a specific technical solution to a technical problem, then it should pass Step 1.
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I mean, all claims, if we reduce them to a high enough level, you could say it's—it's an abstract idea.
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But that's not the final question.
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Judge Clevenger
In all of these cases that deal with data—massaging data, in all the cases in which we have found them to be drawn to an abstract idea,
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the same argument could be made that they were solving a technical solution.
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I mean, that's inherent in what they're doing.
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To be sure, if you are capturing images in the memory—in the—in the—you know, in the card,
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if you take a picture and you capture that image in the card, that's a—solving a technical problem.
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How do you—how do you take a picture digitally, and then how do you—
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find the image that goes somewhere that it can be transferred and manipulated?
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Well, all of these cases, unless I'm mistaken, I went back and looked at the core of the cases cited by your adversary.
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All those cases involve practical solutions to problems that have a technical character,
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but partly because you're using a computer to drive the solution to the problem.
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Yeah.
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I don't see—it seems to me that your empathy—
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This is on the technical aspects, the solution to the problem is, in my judgment,
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more properly advanced at step two of Alice, where you would be trying to say,
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even if the claim is drawn to an abstract idea, something unusual, out-of-the-ordinary, exceptional is happening,
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such as perhaps you are teaching a computer how to perform a new trick.
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Appellant Attorney (John J. Edmonds)
And we would suggest that the cardio—
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And we would suggest that the cardio net and unilock cases cited in our brief take into account
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whether it provides a technical improvement, technical solution.
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But let's focus on step two in the interest of time, and a fair suggestion.
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So with respect to step two, and we're talking about 064, and as you suggested,
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we can just talk about 064 and 095 in the same conversation.
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The invented solution, which was unconventional,
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is that the camera—
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tracks which images have been transferred.
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Judge Clevenger
Well, first off, the camera is, first off, receiving and storing the image, right?
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Correct.
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It captures an image in the memory that's on the memory card, right?
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Correct.
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Okay, that's happening.
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Is that using anything that isn't off-the-shelf technology?
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Appellant Attorney (John J. Edmonds)
No, we're not into the claimed invention yet, but no.
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Judge Clevenger
But let me just—
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If you're taking representative claim eight of the 064, just for example,
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if you take—I mean, that's sort of the way you try to see what's happening technologically.
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This is at step two.
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Appellant Attorney (John J. Edmonds)
What's happening technologically, if you look at figure four,
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and this is explained at appendix 30 and in column seven,
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it talks about how—
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an image can be—could be uploaded but not transferred,
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or it could be uploaded and transferred,
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and that that data is—
12:20
Judge Clevenger
Uploaded from what to what?
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Appellant Attorney (John J. Edmonds)
It could be transferred—it could be uploaded but not transferred.
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Judge Clevenger
Wait, wait, wait.
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It's uploaded—the image is in the camera?
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Appellant Attorney (John J. Edmonds)
No, uploaded somewhere else.
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Transferred somewhere else, outside of the camera.
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Judge Clevenger
Wait, wait, wait.
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The image starts in the camera, correct?
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You take it—snap a picture with my digital camera,
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and the image is recorded, you know,
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on the little disk that's in there, right?
12:45
Yes.
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Now, where am I going to transfer it to?
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Appellant Attorney (John J. Edmonds)
You could transfer it to the cloud.
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You could send it to the cloud.
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You could send it to another device.
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Judge Clevenger
I could send it to my computer.
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Correct.
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Wirelessly, I could send it either to my computer or to a cloud someplace else
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where it's going to be stored.
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Appellant Attorney (John J. Edmonds)
Right.
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And the camera is tracking whether that transfer has taken place,
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so you can tell from the camera.
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Judge Clevenger
The camera can keep track of whether that happened.
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Correct.
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And doing that is—
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Is the camera using anything new and novel?
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Is the camera using off-the-shelf technology?
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No, it—
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Judge Lourie
Is it all software?
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Is it all programming?
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Appellant Attorney (John J. Edmonds)
It is, yes.
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It is a—the camera is hardware, so it is programmed hardware.
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But, yes, the camera has been programmed in order to perform this function.
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Let's move on to—
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And so it—
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Judge Clevenger
Yeah.
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The camera keeps track.
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The camera—I took a picture of you just now,
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and wirelessly it went to my computer over my chambers,
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and either the camera or the computer knows that it got transferred.
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Right?
13:57
Judge Lourie
The camera knows that that is new.
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Judge Clevenger
And it will keep track over time.
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And then if I would like to delete everything that's on the disk in the camera, the chip,
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I can push a button or whatever, and it will empty out the chip to make it free.
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To collect more pictures.
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Appellant Attorney (John J. Edmonds)
If I want to empty out what's been transferred, it now knows what's been transferred, and I can just delete it.
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Judge Clevenger
And the beauty of the patent is that all of a sudden, my disk, which was otherwise full,
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meaning I couldn't take any more pictures, I've used up all the capacity of the disk,
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I can push a button, clean the disk, erase it, and start over again.
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Appellant Attorney (John J. Edmonds)
The benefits are that if I don't have connectivity, I can tell from the camera what I've—
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downloaded or not.
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I can delete those one at a time.
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Now I can delete them en masse, which I couldn't do before.
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Judge Prost
Can I ask you, is the software implementation needed to practice the invention?
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Isn't that really conventional and within the knowledge of one's skills in the art?
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No.
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In certain of the patents, it says that right in the spec.
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I don't recall exactly what is that about the patent we're talking about now.
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Appellant Attorney (John J. Edmonds)
But it says that—
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It makes a statement to that effect in the specification of the 294 patent.
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It doesn't make a statement to that effect in the specification of any—
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None of the other patents make that statement.
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With respect to the 064 that we were just talking about, no, it's not conventional,
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because the patent describes in column one what was conventional, which it could—
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As you're transferring an image, it might display to show you, hey, this image is being
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transferred, or you may have this image deletion preference, but the functionality that's claimed
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is not stated to be conventional.
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It's juxtaposed against the conventional.
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Judge Lourie
Counsel, your time has expired, but let's hear from the other side, and we'll give you
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five minutes for rebuttal.
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Appellant Attorney (John J. Edmonds)
Let me take just one more minute, and I'll take it off on the other side, because I've
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only talked about one patent.
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Judge Lourie
All right.
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Appellant Attorney (John J. Edmonds)
Because I don't want to cover—
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Say I didn't cover it in the opening.
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With respect to—so we've talked about the 064.
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For the 294, and I think the case that the court should consider is self-spin, when self-spin
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had a two-step process that was unconventional and was inventive, and that's exactly what
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we have here.
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The two-step process is we have a pre-screening process with a rougher algorithm that has
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higher false positives, and then a second step where you just analyze the windows or
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the regions that you got from the first step, and that's juxtaposed against what's conventional.
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There are lots of benefits that flow from that in terms of, say, it's processing and
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allows you to use devices to do this that you couldn't do before, so it conserves processing,
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but the two-step process itself—
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Is enough and has been pledged to be enough to get it passed.
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Judge Lourie
None of which negates the idea that the steps are abstract.
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Appellant Attorney (John J. Edmonds)
Well, that's—if I'm talking more about—we would say that it passes step one because
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it has a specific technical improvement and technical solution, but really, when I talk
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about inventiveness and unconventionality, we're talking about step two.
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So whether it's abstract or not is a different question than step two.
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Judge Lourie
Let's hear from the other side.
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Thank you.
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Mr. Stewart.
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Appellee Attorney (Douglas Fred Stewart)
Thank you, Your Honors.
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May it please the Court?
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Judge Prost
Mr. Stewart, can I ask you a preliminary housekeeping question?
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Certainly.
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Which your friend can disagree with when he gets up on rebuttal, if that's the case.
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But my—the way I understand this case is if we were to affirm, hypothetically, on the
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101 issues with respect to all the patents, that the issues we raised with respect to
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Appellee Attorney (Douglas Fred Stewart)
willfulness and inducement are moved.
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Correct.
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The remaining patent, the sixth patent that had been asserted, has been disallowed.
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So I'm going to ask you to dismiss with prejudice—
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Thank you.
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—and per agreement.
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Your Honors, I would start by addressing the concern, perhaps, that the judge's order was
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not robust enough, I believe, that Mr. Edmunds raised.
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And I would say that the conciseness of the judge's opinion is due to the fact that all
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five of these patents fall squarely within the category of ineligible subject matter,
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which has been laid out in this Court's prior cases.
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Judge Lourie
Well, the Court didn't even provide for an oral argument.
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I'm sorry.
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The Court did not provide for an oral argument.
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Did it?
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Appellee Attorney (Douglas Fred Stewart)
No, Your Honor.
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The Court did it on the briefs.
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Judge Lourie
Mm-hmm.
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And with just almost a one-sentence statement, substantive statement, with respect to each
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patent?
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Appellee Attorney (Douglas Fred Stewart)
Well, Your Honor, I believe that the patents in this case are very squarely ineligible.
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And so I don't know that more than that was required to dispense with each of the representative
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claims.
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And I'm happy to talk about each of the patents, but we can start with, for example, the 294,
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which was the patent—
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Right.
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—that Mr. Edmonds was last speaking about.
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And in that case, this patent is directed to data manipulation.
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And the Ricogna Court decision from this Court, as well as the Digitech decision—
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Judge Clevenger
Well, let me just go back to a second to the question of whether or not the case was
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properly resolved on the pleadings.
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The standard review is de novo, correct?
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Correct.
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For every issue.
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Right.
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And so one of the key problems with your adversary's case, from your point of view, is a Second
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Amendment complaint is conclusory.
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It is.
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It is.
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That is, allegations about technical improvements is—which is where the—he seems to be agreeing
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is the core of his case, which really pretty much goes to step two.
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He says this is a technological advance, sufficient under the law, cites a case.
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What more did he have to say to be non-conclusory?
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Appellee Attorney (Douglas Fred Stewart)
Well, Your Honor, I don't think that you can plead your way out of an eligible subject
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matter.
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Judge Clevenger
Well, no, I'm not talking—you might not be—you might—let's assume for purposes
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of argument that the panel agreed that the claims are drawn to abstract ideas.
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Okay.
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That doesn't end the case.
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He's got a shot at being able to prove that something unusual happened.
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He has claimed there is.
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He has said so in his Second Amendment complaint, but his statement is being rejected by you,
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and presumably by the court, as being conclusory.
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Correct.
20:51
How do I—what's the difference between—what's conclusory about an allegation that there's
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a technological advance?
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Appellee Attorney (Douglas Fred Stewart)
Well, Your Honor, I think that simply stating that without—
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Judge Clevenger
Put yourself in his shoes and just add to the—you know the technology here very well—add
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to the—dress up the conclusory allegation of technological advance and tell me what
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else he should have said.
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Appellee Attorney (Douglas Fred Stewart)
Well, Your Honor, I can't, because I don't believe there is a technical advance.
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And to the extent that Mr. Edmonds believes there's—
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Judge Clevenger
Well, if you were on his side, sure you could.
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Appellee Attorney (Douglas Fred Stewart)
Your Honor, I'm really at a loss, because these patents are not the type of patents
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that display—
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Judge Clevenger
Well, he just made an argument with regard to the second algorithm in the 294.
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And he said the second algorithm is producing an image.
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It's producing something tangible.
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Under our case law, as you know, the production of something tangible may be material.
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In step two analysis—
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Appellee Attorney (Douglas Fred Stewart)
Your Honor, with the 294, you start with something tangible.
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You have a data set.
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Then you apply an algorithm.
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You get results.
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You apply another algorithm.
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You get another set of results.
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That's a data-in, data-out analysis that falls squarely in ReCognicorp.
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There's nothing new about that.
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The algorithms that are disclosed—
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Judge Clevenger
Yeah, but you're pulling a different image.
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You're basically—you're starting with—you see, you know, I know the way it works.
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The software hunts through all the pictures.
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And it's—first off, it's hunting through all the pictures.
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So it pulls them all up.
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And then it has a little piece.
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And it takes my face and runs it against all those other faces and tells me whether my
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face is in there.
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Appellee Attorney (Douglas Fred Stewart)
Well, but, Your Honor, to the—
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Judge Clevenger
So it is producing—my—when it produces my face, it's producing something new.
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Appellee Attorney (Douglas Fred Stewart)
Well, Your Honor, to the computer—
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Judge Clevenger
As a part—right from the other step.
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Appellee Attorney (Douglas Fred Stewart)
To the computer, it's just data.
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It starts with a data set.
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And that data set is image data.
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Okay.
22:39
Judge Clevenger
But, I mean, why shouldn't we be able to read his complaint to say that when he says that
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there's technological advance—
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that that's what he was saying?
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I mean, if, for example, he had said in his Second Amendment complaint, when I get to
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this 294 patent, I'll concede for purposes of argument that it's—that it's abstract—abstract
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idea.
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But I think the second algorithm saves it under the case law because it's producing
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this new image.
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Would that have been sufficient to survive a motion to dismiss on the pleading?
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Appellee Attorney (Douglas Fred Stewart)
I don't think so, Your Honor.
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Why not?
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Because I think that the judge is entitled to examine the allegation and determine whether
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or not there's merit to it.
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You can't just go and put anything you want in your complaint and have it be taken as
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true.
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The judge has to evaluate the statement.
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And if there's a conclusory statement that's not—that is not tied to any fact that's
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laid out in the patent, then I don't believe that the judge has to accept it.
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Judge Clevenger
Well, you were in essence saying you should have thrown out the pleadings under our law
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that deals with what has to be in a pleading to make it sufficient even to look to see
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what it is.
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Appellee Attorney (Douglas Fred Stewart)
Well, Your Honor, in this case, we gave them a roadmap.
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You know, they filed a complaint.
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They filed a First Amendment complaint that related to the parties.
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We filed a motion to dismiss.
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And then they filed a Second Amendment complaint in an attempt to work around our motion to
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dismiss.
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So we gave them a roadmap of what to do.
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They did make changes to the complaint, but it just consisted of conclusory allegations.
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They didn't point to a specific technical issue.
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They just made a bunch of statements about the impact of the patent or, you know, what
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the judge should believe the patent does.
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But the claims themselves are directed to data analysis.
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And that subject matter is squarely within the case—the line of cases from this court
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that say it's patent ineligible.
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Judge Clevenger
Well, that's—I'm not disagreeing with you on the question of whether or not step
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one is met.
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I think the game is in step two.
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And what I'm asking you is how much specificity.
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Does a plaintiff have to make in his first complaint or Second Amendment complaint to
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survive a motion to dismiss on the step two issue?
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Appellee Attorney (Douglas Fred Stewart)
Well, I think that a patent owner would need to say there is a technical advance and what
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the technical advance is.
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And that technical advance cannot be a conventional outcome using conventional generic software
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and hardware, which in all five of these patents, they're using conventional computer components.
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There's nothing new there.
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There's no new computer functionality that's described.
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This is all computer—computers or computer hardware and software manipulating data.
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Each of the five patents presented slightly differently.
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A few of them are drawn to user experience.
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Judge Clevenger
And you said as much in your papers filed to support your motion to dismiss, right?
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Appellee Attorney (Douglas Fred Stewart)
Correct, Your Honor.
25:37
Correct.
25:39
So, Your Honor, with regard to the 294, I think the 294 patent in particular, if you
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examine the claim, the claim is drawn to data in, data out, as I said.
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The ReCogniCorp case, I think, treats that concept that you are not entitled to a patent
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on that.
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In fact, in this particular case, if you look at figure three, it says if the algorithm
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doesn't give you the result you want, a human can just modify, can select the image themselves.
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So, it is juxtaposing human intervention and the data analysis that the computer hardware
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is conducting.
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On the 064 patent, you know, in that case, it's the exact same issue.
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I think Your Honor already referred to this.
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It's basically using a computer as a tool to manage data.
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And the user could track that information themselves.
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In fact, paragraph 111, this is at Appendix 293, that's in the second amended complaint,
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paragraph 111, MPV says, humans could compare what is in the remote storage device with
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what is on the camera.
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So, that automation of a human memory task is squarely within those cases that this court
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has issued in that regard.
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With regard to the 762 patent, that is another case.
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And I would say, too, that the 064, 095, and 762 patent are really about improving the
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user's experience with the hardware.
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In fact, the 064 talks about the purpose of the invention is to alleviate a user's worry
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that they're going to be losing power.
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They're losing track of which photos have been deleted and which ones haven't.
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The 762 patent, likewise, talks about a user anxiety of being overwhelmed.
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That's at column 1, lines 38 to 40 of the 762 patent, by so many new features in the
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camera.
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So, the purpose of the 762 patent is not to improve the camera or to improve its functionality.
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It's to improve the user's experience by reducing the number of features that a particular user
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is presented with at any given time.
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Everything that's in these patents, 064, 095, and 762, is all conventional.
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The 762, in addition, uses functional claiming to describe its...
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The last element of the representative claim 19 is programming the programmable memory.
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There's nothing there.
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That is definitely patent ineligible.
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Judge Lourie
Do you think every step performed through an algorithm is abstract?
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Appellee Attorney (Douglas Fred Stewart)
In general, Your Honor?
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Judge Lourie
Yes.
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Appellee Attorney (Douglas Fred Stewart)
I believe that the case law holds that algorithms themselves, the performance of an algorithm,
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is abstract.
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And whether you have, for example, two algorithms, as in the 294 or 1, is irrelevant, because
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you are performing math, and this goes back to the decision in Fluke, that mere mathematical
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calculations is not patent eligible.
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And the last...
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Judge Clevenger
Well, it depends on what it does.
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That's step two.
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Right?
28:47
Appellee Attorney (Douglas Fred Stewart)
Well, it depends on what the claim says.
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Judge Clevenger
I mean, in the cases that where we've sustained a patent at step two over a step one determination
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that the patent was drawn to an abstract idea, there has been an algorithm driving the computer.
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Appellee Attorney (Douglas Fred Stewart)
There has, but there's been some sort of technological improvement in the computer's function.
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And that's true.
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That's what I mean.
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Judge Clevenger
But I mean, so it's not the fact that you are driving, you're using an algorithm to
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give instructions to a machine, doesn't fully invalidate the patent.
29:23
Correct.
29:23
Your Honor, correct.
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You always have to come to step two and ask what's going on.
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Appellee Attorney (Douglas Fred Stewart)
Correct, Your Honor.
29:27
And I apologize if I gave that impression.
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It's true that you could have a claim that is drawn to the use of an algorithm, but the
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use of the algorithm has to be providing something further.
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It has to be doing something to improve the functionality of the hardware on which it's
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running.
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And that is not what's present in any of these patents.
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That is what's present in these patents.
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That is what's present in the line of cases that this court has issued where they have,
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where you all have upheld patents as being patentable, claims as being patentable, because
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there was some improvement in computer functionality.
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And the last patent, Your Honor, here, Your Honor, is the 484.
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This patent, I think, is perhaps the easiest to dispose of.
30:09
It is directly in line with the American Needle case, which we cited.
30:13
And this is simply about selling.
30:15
This is about using a kiosk to replace a clerk.
30:19
And the patent itself talks about the stated objective of the patent is to provide an opportunity
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for retail customers to purchase more products.
30:31
And it does so by presenting the user, the retail customer, with a product configuration
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that might appeal to them, and it does so using a kiosk.
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This is a do-it-on-a-computer type of kiosk.
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This is the case, this patent.
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So I think all five of these patents fall, as I said, squarely within the category of claims that are not
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making a functional improvement to the hardware on which the algorithm is running,
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on which the software is based.
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These are simply using a computer to automate a human activity or to use a computer as a tool.
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I'm happy to cede the rest of my time unless there are some questions.
31:16
Fine.
31:17
Judge Lourie
Thank you, counsel.
31:18
Appellee Attorney (Douglas Fred Stewart)
Thank you, Your Honor.
31:20
Judge Lourie
Mr. Edmonds, we'll give you five minutes for a bottle.
31:25
Appellant Attorney (John J. Edmonds)
Thank you, Your Honor.
31:28
Taking two points up front that my colleague made.
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So he characterized the 484 patent as just about selling.
31:38
But that gloss is over.
31:41
The 484 patent has modifying the user-supplied image.
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And the specification teaches an example.
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For example, if you're going to put something on a T-shirt,
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you would texture the image to mimic the texturing of the T-shirt and then put it on the T-shirt.
31:59
Like a regular Photoshop, it's in the specification, that's conventional.
32:03
Or if you put on a coffee mug that's 3D, you would take the user-supplied image
32:08
and render that in space to where it would show up in the correct spatial arrangement of the coffee mug.
32:16
So it is a technical solution.
32:19
It's not just some type of advertising, as my friend said.
32:22
With respect to the 762 patent, he characterized it as user experience.
32:27
In the specification, it talked about that you could modify the user interface for somebody to try to make it easier.
32:35
This, the 762 patent, took a different tact.
32:38
They're actually using software that's external to the camera to modify the firmware and disable features.
32:46
So those features...
32:47
It's not just a user experience.
32:49
It's effectively a different camera for that user because the features that they don't want have now been disabled.
32:57
And when it goes to another user, then the features that they want are now enabled and the ones they don't want are disabled.
33:03
So it's a different camera.
33:04
It's not just a user experience.
33:07
Judge Clevenger asked about what more could MPV do than say it's inventive.
33:16
Here's what MPV did.
33:17
In a second amended complaint.
33:19
And in its briefing with the district court and here too.
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It didn't just say this is inventive.
33:26
What we did was we explained the conventional art.
33:31
And this has all been pled.
33:32
So these facts should be accepted as true.
33:35
We explained the conventional art.
33:37
We juxtaposed the solution with the conventional art.
33:42
We pointed out what was inventive and what's unconventional about that.
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And you can't do any more than that on the pleadings.
33:51
And that's exactly what we did.
33:53
And that should be enough at the pleading stage to do that.
33:57
So just so the court gets the...
34:02
We talked about the 762 and 484.
34:07
For the 294, this two-step process...
34:12
And the point that my friend misses is that the second step is only...
34:17
Analyzing the regions with face candidates.
34:20
So you're saving a lot of processing.
34:23
Saving a lot of memory.
34:24
Because you're only looking at certain small areas.
34:26
As opposed to I think Judge Clevenger said.
34:28
That you're familiar with the system where it would just scan the entire image.
34:31
Looking for a face.
34:33
That's what we're not doing here.
34:35
We're narrowing it to just regions that might likely have a face.
34:38
And using the computational power just in those regions.
34:41
And that's what's inventive and unconventional about it.
34:44
With respect to the 484...
34:46
We just talked about the 484.
34:49
With respect to the...
34:51
Let me just talk briefly about the...
34:56
The willfulness and the inducement allegations.
34:59
And the lack of leave to amend.
35:03
The district court misunderstood the standard for willfulness.
35:06
And that's been clarified in this court's reason to send you an opinion.
35:11
SRI versus Cisco.
35:13
September 28th of this year.
35:15
That's been clarified.
35:18
NPV pled that the infringement was clear, unmistakable, inexcusable, egregious.
35:25
Clearly that pleading has been met.
35:27
With respect to the inducement.
35:29
The district court did not...
35:34
Did not carefully read or just mistakenly characterize the inducement allegations.
35:41
The district court's opinion is just incorrect.
35:43
The things the district court says that weren't alleged were absolutely alleged.
35:48
And those are in our brief.
35:50
But specific intent was alleged.
35:53
Usage by customers as infringing was alleged.
35:57
That the instructions caused infringing behavior was alleged.
36:01
The district court just respectfully got all that wrong.
36:07
At a minimum, the district court should have granted leave to amend.
36:11
And the district court's view was, well, I found they're ineligible.
36:17
Therefore, the amendment would be futile.
36:20
But that's incorrect.
36:22
I mean, we know from ATRIX that amendments can be made to address factual concerns.
36:34
And the district court misunderstood how many times the first complaint that was amended
36:40
was amended to drop a party.
36:42
And the district court seemed to think...
36:44
Judge Lourie
Some of this is not rebuttal, of course.
36:45
But we understand your points.
36:47
Okay.
36:48
And your time has expired.
36:50
Appellant Attorney (John J. Edmonds)
Thank you for your time, Your Honor.
36:51
Judge Lourie
Thank you.
36:51
The case is submitted.