General Electric Companyv.TransData, Inc.

Patent Trial and Appeal Board

Mar 2, 2015

10265899 (P.T.A.B. Mar. 2, 2015)

PUBLIC VERSION
Trials@uspto.gov Paper 34
Tel: 571-272-7822 Entered: April 15, 2015

PUBLIC VERSION

UNITED STATES PATENT AND TRADEMARK OFFICE

BEFORE THE PATENT TRIAL AND APPEAL BOARD

GENERAL ELECTRIC COMPANY,
Petitioner,
v.
TRANSDATA, INC.,
Patent Owner.

Case IPR2014-01380
Patent 6,903,699 C1
1

Before LYNNE E. PETTIGREW, FRANCES L. IPPOLITO, and
CHRISTOPHER M. KAISER, Administrative Patent Judges.
KAISER, Administrative Patent Judge.
DECISION
Denying Institution of Inter Partes Review
37 C.F.R. § 42.108

1
Patent 6,903,699 B2 as modified by reexamination certificate 6,903,699
C1.
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INTRODUCTION
2

A. Background
General Electric Company (“Petitioner”) filed a Petition (Paper 1,
“Pet.”) requesting an inter partes review of claims 1, 3, 5, 8, 10, 11, 16, and
21–53 of U.S. Patent No. 6,903,699 (Ex. 1001, “the ’699 patent”).
TransData, Inc. (“Patent Owner”) filed a Preliminary Response. Paper 22
(“Prelim. Resp.”). Petitioner filed a Reply to the Preliminary Response.
Paper 27 (“Reply”); see also Paper 24 (order authorizing Reply).
We have authority to determine whether to institute an inter partes
review. 35 U.S.C. § 314(b); 37 C.F.R. § 42.4(a). The standard for
instituting an inter partes review is set forth in 35 U.S.C. § 314(a), which
provides that an inter partes review may not be instituted “unless the
Director determines . . . there is a reasonable likelihood that the petitioner
would prevail with respect to at least 1 of the claims challenged in the
petition.” Under 35 U.S.C. § 315(b), “[a]n inter partes review may not be
instituted if the petition requesting the proceeding is filed more than 1 year
after the date on which the . . . privy of the petitioner is served with a
complaint alleging infringement of the patent.”
After considering the Petition, the Preliminary Response, and the
Reply, we determine that a privy of Petitioner was served with a complaint

2
An earlier, non-public version of this decision was issued March 2, 2015.
Paper 28. Because the present version is being issued solely to complete the
public record of this proceeding, the portions of this decision relating to the
treatment of confidential information are relevant only to the original non-
public version. All due dates shall be computed based upon the date of
issuance of the original, non-public version of this decision.
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alleging infringement of the ’699 patent more than one year before the
Petition was filed. Accordingly, we do not institute inter partes review.
B. Related Matters
The ’699 patent has been asserted against multiple defendants,
including Oklahoma Gas & Electric Company (“OG&E”), in an ongoing
multidistrict litigation proceeding, In re TransData Inc. Smart Meters Patent
Litigation, No. 5:12-ml-2309 (W.D. Okla.) (“the MDL proceeding”). Pet.
1–2;
3
Ex. 2002, 6–7. One of the lawsuits alleging infringement of the ’699
patent that was consolidated into the MDL proceeding was TransData Inc. v.
Oklahoma Gas & Electric Company, No. 5-11-cv-01032 (W.D. Okla.) (“the
Oklahoma lawsuit”). Paper 4, 1; see Ex. 2003, 9 (requiring future filings in
case 5-11-cv-01032 to be made in case 5:12-ml-2309). The Oklahoma
lawsuit was consolidated into the MDL proceeding on August 23, 2012. Ex.
2003, 9.
Patents 6,462,713 and 6,181,294, both of which are related to the ’699
patent, also were asserted in the Oklahoma lawsuit and the MDL proceeding.
Ex. 2002, 3–6. These patents are the subjects of pending petitions for inter
partes review, IPR2014-01505 and IPR2014-01559, respectively.
Additionally, ex parte reexaminations are currently pending for claims 1, 3,

3
The page numbers in the Petition begin at 1, increase to 6, then start at 2
and increase thereafter to 61. The material cited here appears on the first
page 6 and the second page 2, which are consecutive pages. To minimize
confusion in this decision, we will not cite to the first set of pages 1 through
5, we will cite the first page 6 as page 1, and we will cite the remainder of
the pages (the second page 2 through page 61) according to their indicated
page numbers.
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5, and 16 of the ’699 patent; claims 1, 2, 5, 6, 7, 15, 16, and 18–26 of the
’713 Patent; and claims 17–20 and 22–29 of the ’294 Patent. Pet. 2–3.

C. The Asserted Grounds of Unpatentability
Petitioner contends that claims 1, 3, 5, 8, 10, 11, 16, and 21–53 of the
’699 patent are unpatentable under 35 U.S.C. §§ 102 and 103 based on the
following grounds (Pet. 23, 31–60):
4

4
Petitioner also provides a declaration from Gregory A. DesBrisay. Ex.
1012 (“the DesBrisay Declaration”).
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Statutory
Ground
Basis
5
Challenged Claims
§ 102(e) Bush 1, 3, 5, 8, 10, 11, 16, 21, 23, 25–47, and 49
§ 103 Bush and
Johnson
1, 3, 5, 8, 10, 11, 16, 21, 23, 25–47, and 49
§ 103 Bush, Johnson,
and Bearden
22 and 24
§ 103 Bush and AMR
Report
45–48, 50, and 52
§ 103 Bush, AMR
Report, and
Siwiak
50 and 51
§ 103 Bush, AMR
Report, and
Krenz
53
D. The ’699 Patent
The ’699 patent relates to electric meters that can communicate over
public wireless data networks. Specifically, the ’699 patent describes a
wireless communication device that permits information to be
communicated to and from an electric meter contained in a meter chassis
that has a protruding dielectric housing. Ex. 1001, 2:53–56. The ’699 patent
describes an embodiment of such a device that comprises “(1) a
communication circuit within the chassis coupled to electric meter circuitry,
and (2) an antenna element within the dielectric housing, the antenna
coupled to the communication circuit.” Id. at 2:58–62.

5
U.S. Patent No. 6,078,785 (Ex. 1003) (“Bush”); U.S. Patent No. 5,553,094
(Ex. 1005) (“Johnson”); U.S. Patent No. 5,627,759 (Ex. 1006) (“Bearden”);
RICHARD D. ALEXANDER, AUTOMATIC METER READING: THE REPORT FOR
ELECTRIC UTILITIES (Greg Formaneck, ed., 1993) (Ex. 1004) (“AMR
Report”); U.S. Patent No. 4,737,797 (Ex. 1007) (“Siwiak”); U.S. Patent No.
5,508,709 (Ex. 1008) (“Krenz”).
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E. Illustrative Claims
Of the challenged claims in the ’699 patent, claims 1, 8, 16, 21, 32,
35, 36, 40, 42, 44, and 45 are independent. Claims 1 and 21 are illustrative
and recite:
1. For use with an electric meter chassis having a dielectric
housing protruding therefrom, a wireless communication
device, comprising:
a communication circuit within said chassis coupled to electric
meter circuitry;
an antenna element within said dielectric housing, said antenna
element coupled to said communication circuit.
21. An electric meter chassis having a dielectric housing
protruding therefrom, comprising:
a wireless communication circuit within said chassis for
communicating meter information through said dielectric
housing, said wireless communication circuit coupled to
electric meter circuitry; and
an antenna element coupled to said wireless communication
circuit and located within said dielectric housing.
Ex. 1001, 7:7–14, Reexamination Certificate 1:24–31.
ANALYSIS
Patent Owner argues that inter partes review may not be instituted
because such institution is barred by 35 U.S.C. § 315(b), which provides that
an inter partes review may not be instituted based on a petition “filed more
than 1 year after the date on which the petitioner, real party in interest, or
privy of the petitioner is served with a complaint alleging infringement of
the patent.” Prelim. Resp. 3, 6–21. For the reasons discussed below, we
agree.
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A. A Complaint Alleging Infringement of the ’699 Patent Was Served
on OG&E More Than One Year Before the Petition Was Filed.
Infringement of the ’699 patent was alleged in the Oklahoma lawsuit.
Ex. 2002, 6–7. The complaint in the Oklahoma lawsuit was served on
OG&E on September 21, 2011. Ex. 2039. The Petition in this proceeding
was filed on August 25, 2014. Paper 6, 1. Accordingly, a complaint
alleging infringement of the ’699 patent was served on OG&E more than
one year before the Petition was filed in this proceeding.
B. OG&E Is a Privy of Petitioner with Respect to the Oklahoma
Lawsuit.
“Privity is essentially a shorthand statement that collateral estoppel is
to be applied in a given case. . . . The concept refers to a relationship
between the party to be estopped and the unsuccessful party in the prior
litigation which is sufficiently close so as to justify application of the
doctrine of collateral estoppel.” Office Trial Practice Guide, 77 Fed. Reg.
48,756, 48,759 (Aug. 14, 2012) (quoting 154 Cong. Rec. S9987 (daily ed.
Sep. 27, 2008) (statement of Sen. Kyl)). Thus, privity exists between
Petitioner and OG&E with respect to the Oklahoma lawsuit if collateral
estoppel could be applied to Petitioner with respect to the Oklahoma lawsuit.
The issue is whether Petitioner could be bound by the judgment in the
Oklahoma lawsuit as a matter of collateral estoppel.
A nonparty to a prior action is bound by the judgment in the prior
action if that party “‘assumed control’ over the litigation in which that
judgment was rendered.” Taylor v. Sturgell, 553 U.S. 880, 895 (2008)
(quoting Montana v. U.S., 440 U.S. 147, 154 (1979)). This includes
indemnitors who assume control of litigation against the parties they
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indemnify. Benson & Ford, Inc. v. Wanda Petroleum Co., 833 F.2d 1172,
1174 (5th Cir. 1987); see Schnell v. Peter Eckrich & Sons, Inc., 365 U.S.
260, 262 n.4 (1961) (holding that an entity that “control[s] the defense of [a]
suit, in which it has an interest, will be bound by the final judgment,” even if
it is not a party to the suit). A nonparty will be found to have control if the
nonparty has “effective choice as to the legal theories and proofs to be
advanced in behalf of the party to the action,” as well as “control over the
opportunity to obtain review.” Benson & Ford, 833 F.2d at 1174. Absolute
control, however, is not necessary. Instead, a nonparty will be found to have
control if it “has the actual measure of control or opportunity to control that
might reasonably be expected between two formal coparties.” 77 Fed. Reg.
at 48,759 (quoting 18A CHARLES ALAN WRIGHT, ARTHUR R. MILLER &
EDWARD H. COOPER, FEDERAL PRACTICE AND PROCEDURE § 4451 (2d ed.
2011)). Moreover, actual control is not required; the opportunity to exert the
appropriate level of control is sufficient. Id. (“A common consideration is
whether the non-party . . . could have exercised control . . . .”); see Gonzalez
v. Banco Cent. Corp., 27 F.3d 751, 758 (1st Cir. 1994) (“[C]ontrol
means . . . the power—whether exercised or not—to call the shots.”).
Thus, if Petitioner had the opportunity to exercise control over
OG&E’s defense in the Oklahoma lawsuit, then it is in privity with OG&E
with respect to that litigation. The evidence of record establishes that
Petitioner had such an opportunity. Petitioner and OG&E entered into a
letter agreement on December 30, 2011, stating that Petitioner would
“provide a full and unqualified defense to OG&E” and that Petitioner would
“direct and control the litigation, provided that [Petitioner] and its counsel
will keep OG&E timely informed of all material activity in the case and will
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solicit OG&E’s input and assent on all material decisions in the case.” Ex.
2015, GE-00001. Under this agreement, Petitioner had the clearly stated
right to “control the litigation.”
Petitioner argues that this right of control was less than total because
the agreement required Petitioner “to solicit OG&E’s ‘assent on all material
decisions.’” Reply 4 (quoting Ex. 2025 ¶ 1). While the degree of control is
a factor to consider in this “highly fact-dependent question,” lack of absolute
control alone is not dispositive. 77 Fed. Reg. at 48,759. Rather, in
determining the existence of privity, we take into account how courts
generally have used the terms to “describe relationships and considerations
sufficient to justify applying convention principles of estoppel and
preclusion.” Id. In considering the jurisprudence on this issue, we note that
courts have found privity where an entity’s control over the litigation was
substantial, even though not complete. Jefferson Sch. of Soc. Sci. v.
Subversive Activities Control Bd., 331 F.2d 76, 83 (D.C. Cir. 1963). The
evidence here shows that Petitioner had substantial, if not total, control over
the Oklahoma lawsuit.
Further, as noted above, where a nonparty entity shares control with a
party, the nonparty is in privity with the party if control is shared as it would
be between two formal coparties. Here, the requirement that Petitioner
solicit input and assent from OG&E is consistent with a relationship between
Petitioner and OG&E similar to that between formal coparties. See Jones v.
Craig, 212 F.2d 187, 187–88 (6th Cir. 1954) (shared control similar to that
between formal coparties existed between party and nonparty even where
nonparty merely “assisted in the preparation of the defense”). This degree of
control is sufficient to establish privity. See 77 Fed. Reg. at 48,759.
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Moreover, although Petitioner argues that it never had actual control
of the Oklahoma lawsuit, Reply 5, the presence or absence of actual control
is immaterial to the privity determination. See 77 Fed. Reg. at 48,759 (“A
common consideration is whether the non-party . . . could have exercised
control . . . .”). The December 2011 agreement establishes that Petitioner
and OG&E are in privity with respect to the Oklahoma lawsuit.
In addition, the December 2011 agreement ratified a May 9, 2008
purchase agreement between Petitioner and OG&E. Ex. 2015, GE-00001.
The May 2008 agreement required OG&E to give Petitioner “sole
authority . . . to direct and control all defense, settlement, and compromise
negotiations.” Ex. 2017, GE-00034. Under the May 2008 agreement,
Petitioner had the opportunity to control any litigation arising from the
service on OG&E of a complaint alleging infringement of the ’699 patent,
6

and this opportunity was unfettered by the requirements of the December
2011 agreement that Petitioner solicit OG&E’s input and assent. Thus, even
if the December 2011 agreement’s requirements had abridged Petitioner’s
control sufficiently to avoid privity being established under that

6
Petitioner argues that the May 2008 agreement is irrelevant because the
Oklahoma lawsuit did not accuse the meters sold under that agreement of
infringing the ’699 patent. Reply 3. We disagree. First, the Oklahoma
lawsuit accused “electric meters, specifically including, without limitation,
General Electric I-210 electric meters,” so it was not limited to the I-210
meters sold under later agreements. Ex. 2002 ¶ 30 (emphasis added). In
addition, the Oklahoma lawsuit accused additional, unspecified meters as
well. Id. ¶ 31. Moreover, the December 2011 agreement stated that the
indemnification Petitioner agreed to provide was in satisfaction of OG&E’s
indemnification rights under the May 2008 agreement, suggesting that the
Oklahoma lawsuit encompassed the meters sold under the May 2008
agreement. Ex. 2015, GE-00001.
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agreement—which we find not to be the case—Petitioner would have had an
opportunity to control the litigation sufficient to establish privity under the
May 2008 agreement.
7

C. Privity with Respect to the Oklahoma Lawsuit Is Sufficient to
Implicate 35 U.S.C. § 315(b).
Petitioner argues that only privity with respect to the present inter
partes review proceeding, not privity with respect to the Oklahoma lawsuit,
is relevant to the application of the § 315(b) bar. Reply 1–2. In particular,
Petitioner first argues that, because a function of the identification of privies
is to “assure proper application of the statutory estoppel provisions,” and
because the only “‘statutory’ estoppel issue for the Board is whether its trial
decision would estop a third party under § 315(e),” the definition of privy
must be limited to those entities in privity with Petitioner with respect to the
present proceeding. Reply 1 (quoting 77 Fed. Reg. at 48,759). Petitioner
suggests that we improperly would give “privy” different meanings in
different parts of the statute if we were to interpret it as referring to privies
with respect to an inter partes review for purposes of § 315(e) but as
referring to privies with respect to a lawsuit for purposes of § 315(b). Id.
(citing Ratzlaf v. United States, 510 U.S. 135, 143 (1994)).
We do not agree with Petitioner’s reading of § 315. Petitioner’s
argument ignores that, in both circumstances, we focus on the relationship of

7
Because Petitioner had a sufficient opportunity to control litigation under
the May 2008 agreement to establish privity, and because that agreement
predates the service of the complaint in the Oklahoma lawsuit, we find, in
addition to Petitioner and OG&E being in privity with respect to the
Oklahoma lawsuit, that Petitioner and OG&E were in privity at the time that
OG&E was served with the complaint in the Oklahoma lawsuit.
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the later proceeding’s petitioner to the earlier proceeding’s parties. It is true
that, for purposes of applying the estoppel provisions of § 315(e), privity
with respect to an earlier inter partes review proceeding is important, but
this is because privity with respect to the earlier proceeding will bar
institution of a later proceeding, not because privity is limited to arising from
inter partes review proceedings. See 77 Fed. Reg. at 48,759 (quoting 154
Cong. Rec. S9987 (daily ed. Sep. 27, 2008) (statement of Sen. Kyl))
(“Privity . . . refers to a relationship between the party to be estopped and the
unsuccessful party in the prior litigation . . . .” (emphasis added)). There is
no inconsistency in following precisely the same approach for cases
implicating § 315(b), barring institution of a later proceeding when the later
proceeding’s petitioner and an entity involved in earlier litigation are privies
with respect to the earlier litigation.
We also do not agree with Petitioner that our “mandate for expedited
proceedings with limited discovery,” Reply 2, requires that we limit our
analysis of privity to whether Petitioner and OG&E are privies with respect
to the present proceeding. It may be that the nature of inter partes review
proceedings is such that, in some cases, it will be difficult to establish privity
with respect to a prior proceeding so as to bar the institution of review in a
later one. But we need not concern ourselves with that possibility in this
case. As discussed above, the evidence of record here establishes that
Petitioner and OG&E are privies with respect to the Oklahoma lawsuit.
D. Institution of Inter Partes Review is Barred by 35 U.S.C. § 315(b).
Because Petitioner had the opportunity to control OG&E’s litigation
defense, we find that Petitioner and OG&E are privies with respect to the
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Oklahoma lawsuit. Accordingly, we find that a privy of Petitioner, OG&E,
was served with a complaint alleging infringement of the ’699 patent more
than one year before the Petition was filed in this proceeding, and we
conclude that, pursuant to 35 U.S.C. § 315(b), we may not institute inter
partes review.
CONFIDENTIAL INFORMATION
There are several issues that remain to be resolved regarding the
parties’ submission of confidential information and our reliance on it.
First, Patent Owner moved to seal the confidential version of its
Preliminary Response, and Petitioner moved to seal the confidential version
of its Reply. Paper 23; Paper 26. Both of these pleadings rely on Exhibits
2015 through 2026, which are marked as confidential information pursuant
to the protective order entered in this proceeding. Paper 22; Paper 27; see
Paper 20 (entering protective order). Redacted versions of both pleadings
also have been provided. Paper 23; Paper 25. Accordingly, we grant the
motions to seal the Preliminary Response and the Reply. Papers 22 and 27,
the confidential versions of the Preliminary Response and the Reply, shall
remain under seal. The redacted version of the Preliminary Response is
attached to Patent Owner’s motion to seal. Paper 23. Neither Patent
Owner’s motion to seal nor the redacted version of the Preliminary Response
appears to disclose or rely on any confidential information. Accordingly,
Paper 23 shall be made publicly available.
Second, no party has yet moved to seal Exhibits 2015 through 2026,
which currently are accessible only to the parties and the Board. Each of
these exhibits is marked as confidential information pursuant to the
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protective order, so we are hesitant to make them publicly available. Each
of these exhibits was produced by Petitioner, who appears to have added the
confidential designations. Accordingly, within ten days of the issuance of
this decision, Petitioner shall file a motion to seal Exhibits 2015 through
2026, explaining why each document should remain under seal. Because, as
discussed below, we have relied only on Exhibits 2015, 2017, and 2025,
Petitioner instead may move to expunge the other Exhibits (i.e., Exhibits
2016, 2018–2024, and 2026) from the record. 37 C.F.R. § 42.56.
Third, this decision relies upon confidential information appearing in
Exhibits 2015, 2017, and 2025, as well as in the confidential versions of the
Preliminary Response and the Reply. Within ten days of the issuance of this
decision, Petitioner shall file a motion to seal the present decision,
explaining why this decision should be kept under seal. Petitioner’s motion
shall include a proposed redacted version of this decision to be made
publicly available. If Petitioner does not file a motion to seal this decision
and Exhibits 2015, 2017, and 2025 within ten days of the issuance of this
decision, or if Petitioner’s reasons for maintaining Exhibits 2015, 2017, and
2025 are inadequate, those exhibits and this decision shall become publicly
available.
CONCLUSION
Upon consideration of the Petition, the Preliminary Response, and the
Reply, we conclude that institution of inter partes review is barred by 35
U.S.C. § 315(b). Accordingly, we do not institute inter partes review of any
of the challenged claims on any of the asserted grounds.

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ORDER
It is hereby
ORDERED that the Petition is denied as to all challenged claims, and
no trial is instituted;
FURTHER ORDERED that Patent Owner’s Motion to Seal the
Preliminary Response (Paper 23) is granted;
FURTHER ORDERED that Petitioner’s Motion to Seal the Reply
(Paper 26) is granted;
FURTHER ORDERED that Patent Owner’s Motion to Seal the
Preliminary Response and Redacted Preliminary Response (Paper 23) shall
be made publicly available;
FURTHER ORDERED that, no later than ten days after the issuance
of this decision, Petitioner shall file a motion to seal Exhibits 2015, 2017,
and 2025, explaining why those exhibits should remain under seal;
FURTHER ORDERED that, no later than ten days after the issuance
of this decision, Petitioner shall either file a motion to seal Exhibits 2016,
2018 through 2024, and 2026, explaining why those exhibits should remain
under seal, or move to expunge Exhibits 2016, 2018 through 2024, and 2026
from the record;
FURTHER ORDERED that, no later than ten days after the issuance
of this decision, Petitioner shall file a motion to seal, explaining why this
decision should remain under seal, and including a redacted version of this
decision that can be made publicly available; and
FURTHER ORDERED that the present decision shall remain under
seal until Petitioner’s motion to seal the present decision and Exhibits 2015,
2017, and 2025 is resolved.
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PETITIONER:

Deakin Lauer
Joseph Jakubek
Jeffrey Love
KLARQUIST SPARKMAN LLP
deakin.lauer@klarquist.com
joseph.jakubek@klarquist.com
jeffrey.love@klarquist.com

PATENT OWNER:

Robert Sterne
Donald Banowit
Graham Phero
STERNE, KESSLER, GOLDSTEIN & FOX
rsterne-PTAB@skgf.com
dbanowit-PTAB@skgf.com
gphero-PTAB@skgf.com