Worlds Reply Bungie v. Worlds Appellate For PTAB

Case: 17-1481 Document: 32 Page: 1 Filed: 09/22/2017
Nos. 2017-1481, -1546, -1583
United States Court of Appeals

for the Federal Circuit
WORLDS INC.,
Appellant,
v.
BUNGIE, INC.,
Appellee.
On Appeal from the United States Patent and Trademark Office

Patent Trial and Appeal Board in Nos. IPR2015-01264,
IPR2015-01319, and IPR2015-01321
APPELLANTS REPLY BRIEF

WAYNE M. HELGE
ALDO NOTO
GREGORY A. KRAUSS
DAVIDSON BERQUIST JACKSON
& GOWDEY, LLP
8300 Greensboro Drive, Suite 500
McLean, VA 22102
(571) 765-7700
whelge@dbjg.com
anoto@dbjg.com
gkrauss@dbjg.com
Counsel for Appellant Worlds Inc.
SEPTEMBER 22, 2017
COUNSEL PRESS, LLC (888) 277-3259

CERTIFICATE OF INTEREST
In accordance with Federal Circuit Rule 47.4(a) and (b), counsel for
Appellant WORLDS INC. certifies the following:
1. The full name of every party represented by me is WORLDS INC.
2. The real party in interest is the same as the party represented,
WORLDS INC.
3. There is no parent corporation or publicly held company that owns
10% or more of stock in WORLDS INC.
4. The names of all law firms and the partners and associates that
have appeared for the party in the lower tribunal or are expected to appear
for the party in this court and who are not already listed on the docket for
the current case:
Donald L. Jackson
Michael R. Casey
DAVIDSON BERQUIST JACKSON &
GOWDEY, LLP
/s/ Wayne M. Helge

Wayne Michael Helge
Aldo Noto
Gregory A. Krauss
DAVIDSON BERQUIST JACKSON
& GOWDEY, LLP
McLean, VA 22102
(571) 765-7700
Counsel for Appellant Worlds, Inc.
-i-
TABLE OF CONTENTS
CERTIFICATE OF INTEREST .......................................................................... i
TABLE OF CONTENTS .................................................................................... ii
TABLE OF AUTHORITIES ............................................................................. iv
INTRODUCTION ...............................................................................................1
ARGUMENT .......................................................................................................3
A. Funkhouser 93 In Combination With the Other Art of

Record Does Not Render Obvious the Claims at Issue ............................3
1. There is No Record Evidence To Support the Boards

Conclusion That Avatars Would Have Been Limited Or
Filtered From A Display Under A Combination Of
Funkhouser 93 and Funkhouser 95...................................................4
i. The Record Contains No Evidence On The Value Of

Avatars Relative To Other Objects ...............................................6
ii. There Is No Evidence That Avatars Would Fall

Outside The Most Valuable Objects Criteria of
Funkhouser 93..............................................................................8
iii. There Is No Evidence That Some Avatars Would Be

Omitted by Funkhouser 93 While Others Would Be
Displayed .......................................................................................9
iv. Bungie Failed To Fully Develop Its Funkhouser 93

Argument During IPR .................................................................10
v. Bungie Now Looks Beyond The Record Evidence In

Search Of Support For The Relative Importance Of
Avatars ........................................................................................12
vi. Neither Funkhouser 93 nor Funkhouser 95

Discloses That Avatars Are Treated As Objects.........................13
-ii-
2. Funkhouser 93 Treats Books As Texture Of A

Bookshelf Rather Than Objects And Does Not Disclose
Omitting Books Under A No Polygons At All
Embodiment ......................................................................................14
3. The Board Failed To Articulate A Proper Motivation To

Combine Funkhouser 95 and Funkhouser 93 .................................16
B. The Boards Real Party In Interest Ruling Must Be

Overturned ..............................................................................................19
1. The Board Improperly Shifted The Burden Of Proof On

Real Party In Interest .........................................................................19
2. Worlds Supplied At Least The Minimum Quantum Of

Evidence Required To Rebut Bungies Presumption........................21
3. Contract Interpretation Is A Matter Of Law And Is

Reviewable De Novo.........................................................................23
4. The Boards Contract Interpretation Is Incorrect ..............................24
5. Bungie Produced No Evidence, Let Alone Sufficient

Evidence, To Carry Its Burden of Production ...................................27
6. Bungie Does Not Contest The Importance Of Real Party

In Interest To This Case ....................................................................29
7. Collateral Estoppel Does Not Bar Review Of Real Party

In Interest ...........................................................................................30
CONCLUSION AND RELIEF REQUESTED .................................................33
-iii-
TABLE OF AUTHORITIES
Page(s)
Cases
A.C. Aukerman Co. v. R.L. Chaides Construction Co.,

960 F.2d 1020 (Fed. Cir. 1992) (en banc) ................................................ 21
Atlanta Gas Light Co. v. Bennett Regulator Guards, Inc.,

IPR2013-00453, Paper 88 (PTAB Jan. 6, 2015),
rehg denied, Paper 91 (Feb. 23, 2015) ............................................. passim
Ball Aerosol v. Ltd. Brands,

555 F.3d 984 (Fed. Cir. 2009) .................................................................. 14
Bausch & Lomb Inc. v. Barnes-Hind Inc.,

796 F.2d 443 (Fed. Cir. 1986) .................................................................. 11
Bowman Transp., Inc. v. Ark.-Best Freight Sys., Inc.,

419 U.S. 281 (1974) ................................................................................. 17
Ethicon, Inc. v. U.S. Surgical Corp.,

135 F.3d 1456 (Fed. Cir. 1998) ................................................................ 23
Gonzalez v. Banco Cent. Corp.,

27 F.3d 751 (1st Cir. 1994) ...................................................................... 22
Graham v. John Deere Co. of Kansas City,

383 U.S. 1 (1966) ..................................................................................... 19
In re Freeman,
30 F.3d 1459 (Fed. Cir. 1994) .................................................................. 31
In re Mercier,
515 F.2d 1161 (C.C.P.A. 1975) ................................................................ 11
In re NuVasive,
842 F.3d 1376 (Fed. Cir. 2016) ................................................................ 16
In re Wesslau,
353 F.2d 238 (C.C.P.A. 1965) .................................................................. 11
-iv-
Insite Vision Inc. v. Sandoz, Inc.,

783 F.3d 853 (Fed. Cir. 2015) .................................................................. 17
KSR Intl Co. v. Teleflex Inc.,

550 U.S. 398 (2007) ................................................................................. 13
Mintz v. Dietz & Watson, Inc.,

679 F. 3d 1372 (Fed. Cir. 2012) ............................................................... 18
Monarch Knitting Mach. Corp. v. Sulzer Morat GmbH,

139 F.3d 877 (Fed. Cir. 1998) ............................................................. 17-18
Montana v. U.S.,
440 U.S. 147 (1979) ................................................................................. 31
Mosher Steel Co. v. NLRB,

568 F.2d 436 (5th Cir. 1978) .................................................................... 32
NLRB v. Markle Mfg. Co. of San Antonio,

623 F.2d 1122 (5th Cir. 1980) .................................................................. 32
Personal Web Technologies, LLC v. Apple, Inc.,

848 F.3d 987 (Fed. Cir. 2017) .................................................................. 18
Redline Detection, LLC v. Star Envirotech, Inc.,

811 F.3d 435 (Fed. Cir. 2015) .................................................................. 23
SEC v. Chenery Corp.,

332 U.S. 194 (1947) ................................................................................. 17
United States v. Utah Contr. & Mining Co.,

384 U.S. 394 (1966) ........................................................................... 30, 31
Univ. of Tenn. v. Elliott,

478 U.S. 788 (1986) ................................................................................. 31
Wickham Contracting Co. Inc. v. Board of Educ. of City of New York,

715 F.2d 21 (2d Cir. 1983) ....................................................................... 32
Statutes
35 U.S.C. 315(b) (2011) .................................................................................. 30
-v-
Rules
37 C.F.R. 42.63(a) (2016) ................................................................................ 28
37 C.F.R. 42.51(b)(1)(ii) (2016) ...................................................................... 28
Fed. R. Evid. 301 ................................................................................................ 20
Other Authorities
Office Patent Trial Practice Guide,

77 Fed. Reg. 48,756 (Aug. 13, 2012) ........................................... 22, 27, 29
-vi-
INTRODUCTION
Bungies Response Brief (Red Br.) all but confirms the defects in the
Boards decisions below. Most glaringly, Bungie fails to provide any response to
Worlds argument that claims 8 and 10 of U.S. Patent No. 8,082,501 (the 501
patent) require disparate treatment of other user avatars (Blue Br. 41-43), and
that this feature is neither addressed by the Board nor disclosed or suggested in
any reference. Appx0233-0236. The Boards decision on these claims must be
vacated.
These claims and claims 13-15 of U.S. Patent No. 8,145,998 (the 998
patent) (collectively, the claims-at-issue) survive also because the Board had
no basis to conclude that avatars would be subject to limiting or filtering under
the specific teachings of Funkhouser 93.1 As the Board acknowledged,
Funkhouser 93 teaches that the most valuable objects are never omitted even
where a no polygons at all setting is permitted. Appx0234, Appx0236.
Further, Bungie has no evidence to establish whether avatars would have been
treated as objects, or how avatars would have been valued under Funkhouser 93.
Having submitted no evidence and no expert testimony on the value of avatars,
1
Funkhouser 93 was introduced in Worlds Opening Brief. Blue Br. 3,
13-14, 17-19.
1
Bungie now incorrectly argues that importance does not matter, despite
Funkhouser 93s clear teaching to the contrary. Red Br. 43.
Bungie also tries to shore up the Boards defective analysis on the real
parties in interest. In deciding this critical issue, the Board first improperly
shifted the burden of proof to Worlds. Blue Br. 27-28. This is a clear error of
law. Blue Br. 26. Then, Bungie chose to submit no evidence of its own to prove
that unnamed party Activision Publishing, Inc. (Activision) was not a real party
in interest despite Activisions contractual opportunity to control the proceedings
below. Red Br. 59-60. Now, on appeal, Bungie wrongly asserts that the April 16,
2010 Software Development and Publishing Agreement between Bungie and
Activision (Agreement) proves that Activision had no opportunity to control
the preparation of the inter partes review (IPR) petitions in 2015.
Collectively, the Boards decisions on these issues were not supported by
substantial evidence, lack the necessary evidence-based explanations for the
Boards conclusions, and include clear errors of law. These decisions should be
vacated.
2
ARGUMENT
A. Funkhouser 93 In Combination With the Other Art of Record Does

Not Render Obvious the Claims at Issue
The Boards decisions regarding obviousness have four fatal flaws which
go uncorrected by Bungies Response Brief. The Board fails to articulate:
(i) why an avatar from Funkhouser 95 2 would be treated as an object in
Funkhouser 93s system (Appx0237, Appx0187-0188);
(ii) why an avatar would not be among the most valuable objects in
Funkhouser 93 (Appx0234-0236, Appx0184-0187);
(iii) why avatars in a combination of Funkhouser 93 and Funkhouser 95
would have different valuations such that some are displayed while
others are filtered (Appx0233-0236, Appx0184-0187); and
(iv) why a POSITA would have been motivated to combine Funkhouser
93 and Funkhouser 95 (Appx0189, Appx0235, Appx0237).
With these glaring omissions, the decisions must be vacated as to the
claims-at-issue.
2
Funkhouser 95 was introduced in Worlds Opening Brief. Blue Br. 3,
15-16.
3
1. There is No Record Evidence To Support the Boards Conclusion

That Avatars Would Have Been Limited Or Filtered From A Display
Under A Combination Of Funkhouser 93 and Funkhouser 95
Bungies Response incorrectly asserts that the [p]rior [a]rt [t]eaches the
[l]imitations of the claims at issue. Red Br. 35. To the contrary, there is no
dispute that neither Funkhouser 95 nor Funkhouser 93 discloses the limiting or
filtering of avatars from a users display. Further, even where Funkhouser 93
allows a no polygons at all setting in the optimization algorithm, the most
valuable objects are always displayed. Thus, without evidence establishing that
avatars are valued less than other objects, there is no evidence to support the
Boards conclusion that avatars would have been susceptible to limiting or
filtering according to Funkhouser 93.
In its Response Brief, Bungie selectively reads out portions of Funkhouser
93s teaching when restating its own position. There, Bungie states:
Funkhouser 93 teaches an optimization algorithm that may exclude some
objects from the display entirely if they exceed the maximum number the
computer is capable of displaying at the desired frame rate. Red Br. 41
(emphasis added). But this restatement fails to acknowledge that in Funkhouser
93, the most valuable objects are never excluded. Appx1931. Only objects with
lower value could be allocated a no polygons at all setting under Funkhouser
93s teachings. Appx1931. And yet, the record is devoid of evidence
4
establishing that avatars would be treated as objects in Funkhouser 93, and how
they would be valued as objects.
In its attempt to respond, Bungie:
(i) does not cite to any analysis or opinion from its expert, Dr. Zyda,
regarding the no polygons at all passage in Funkhouser 93 (Red
Br. 36-45; see Blue Br. 33);
(ii) concedes that it did not provide any testimony or argument on
valuing an object (Red Br. 43-45);
(iii) provides no Board support nor explanation for valuing an object
(Red Br. 43-45); and
(iv) ignores the fact that the most valuable objects are rendered always
(Red Br. 38-40).
In ruling the claims-at-issue unpatentable, the Board specifically
overlooked the absence of record evidence with respect to these four points.
Appx0233-0236; Appx0182-0188. Moreover, the Boards errors are particularly
egregious in view of claims 8 and 10 of the 501 patent. Through their
dependence from claim 1, these claims require the filtering of certain avatars, and
the displaying of other avatars. Appx0343. Just as there is no evidence in the
record to justify omitting an avatar from a display due to low value, there is no
5
evidence in the record to justify applying disparate values to avatars such that
some are omitted while others are displayed.
i. The Record Contains No Evidence On The Value Of Avatars

Relative To Other Objects
In its decisions, the Board relies upon Funkhouser 93s disclosure that
even when the level of detail allows no polygons at all, only the most
valuable objects are rendered so that the frame time constraint is not violated.
Appx1931; Appx0234; Appx0187. However, there is no record evidence,
including no declaration from Dr. Zyda, to support the Boards conclusion that
avatars would be among the filtered or limited objects in this scenario.3 See Blue
Br. 33. In essence, the Board has fabricated a scenario where avatars are not
among the most valuable objects to be rendered. No evidence exists to
support this scenario, as both the Board and Bungies counsel acknowledged
during the oral hearing. See Appx0865-0866 (Judge Easthom: What would be a
more important avatar? . . . Mr. Rosato: . . .a prioritization where, you know,
I could imagine different things like, you know, I dont know, some friends are
more important than others. I dont know. Judge Easthom: Well we dont
know either.).
3
As explained, there is no record evidence to establish that avatars
constitute objects in the first place. See Section A.1.vi, infra.
6
Despite Funkhouser 93s clear teachings on the relevance of an objects
value, Bungie incorrectly argues that the Board was not required to evaluate the
importance of avatars. Red Br. at 43-45. But Funkhouser 93s unambiguous
disclosure confirms that the most valuable objects must be displayed even
where a no polygons at all setting is permitted. Appx1931. As such, an object
that is among the most valuable object(s) is never subject to the no polygons
at all setting.
Further, in its Response, Bungie consistently refers to the suggestion of
omitting avatars under certain circumstances. See, e.g., Red Br. at 32, 36, 39-
40. But those circumstances are not found in the record evidence. See, e.g.,
Appx0863-0865. Bungie attempts to bolster the Boards decision, arguing that
these certain circumstances exist when the target fame time is not long enough
to render all potentially visible objects, including avatars, even at the lowest
level. Red Br. at 40 (citing Appx0185, Appx0235, Appx0184). But even under
these circumstances, Funkhouser 93 does not disclose or suggest (and the Board
and Bungie do not contend) that all objects and all avatars would be omitted from
the display. Rather, even under these circumstances, the most valuable
objects are still rendered. Appx1931, Appx0236.
7
ii. There Is No Evidence That Avatars Would Fall Outside The

Most Valuable Objects Criteria of Funkhouser 93
As Worlds noted in its Opening Brief, Funkhouser 93 does not disclose
any valuation of avatars. Blue Br. 37-39. Indeed, Funkhouser 93 offers little
guidance on how to value the disclosed objects. In its decisions, the Board
concludes that Funkhouser 93 discloses omitting books on bookshelves.
Appx0235-0236. Worlds disputes this interpretation of Funkhouser 93 (see
Section A.2, infra; Blue Br. 33), but even assuming arguendo the Board is correct
on this point, it follows at most that books are less important than the bookshelf
and the other objects shown in Funkhouser 93s Fig. 11c. Appx1936. It does
not follow that avatars would be less important than bookshelves, let alone that
avatars would be less important than objects that are not omitted.
Bungie argues that Worlds takes inconsistent positions on Funkhouser
93s teaching of object value. Red Br. 43 n.8. In fact, Worlds position is
consistent, and consistently in favor of the claims-at-issue. Funkhouser 93 fails
to disclose avatars, and does not teach how to value avatars relative to objects
such as chairs, bookshelves, or tables. But Funkhouser 93 also discloses that
certain objects, such as enemy robots, can have the highest value. Appx1932.
Viewed through the lens of Funkhouser 93s no polygons at all setting, where
the most valuable objects are rendered, enemy robots in a video game would
8
never be omitted. Neither Bungie nor the Board cite to any evidence to support
their position that avatars could be omitted, even though enemy robots could not.
Red Br. 54.
Whether this Court agrees that Funkhouser 93 fails to expressly disclose
avatar importance, or whether this Court interprets Funkhouser 93s disclosure of
enemy robot value as a teaching that interactive objects possess a greater
importance than background objects, the result is the same: there is no evidence
that avatars would fall outside the most valuable objects criteria established
by Funkhouser 93.
iii. There Is No Evidence That Some Avatars Would Be Omitted

by Funkhouser 93 While Others Would Be Displayed
Bungie fails to respond to Worlds argument that claims 8 and 10 of the
501 patent are not fully addressed in the Boards decisions. Blue Br. 41-42.
Claim 1 of the 501 patent includes the step of determining, by the client device,
a displayable set of the other user avatars associated with the client device
display. Appx0343(19:34-36). Claims 8 and 10 depend from claim 1, and
therefore require both filtering the other user avatars, and also displaying the
displayable set of other user avatars. Appx0343(20:1-4, 20:9-11). In other
words, these claims provide for disparate treatment of avatars; some are filtered
while others are displayed. Blue Br. 41-42.
9
Funkhouser 93 provides no disclosure of how to value avatars, and
therefore is silent on filtering some avatars from a displayable set while
displaying others. Both Bungie and the Board fail to address the disparate
treatment of avatars under these claims. Therefore, at minimum, the Boards
determination regarding claims 8 and 10 of the 501 patent is unsupported by any
evidence.
iv. Bungie Failed To Fully Develop Its Funkhouser 93 Argument

During IPR
As Worlds previously explained, Bungies lack of evidence on its
obviousness theory is driven greatly by its shifting view on Funkhouser 93s
relevance. Blue Br. 32-37. In its petitions, Bungie first pointed to Funkhouser
93s omission of books from a bookshelf as the allegedly omitted objects, and
cited generally to Dr. Zydas declaration. Appx3765, Appx4945. Later, in its
Replies, Bungie shifted to a no polygons at all theory but failed to address the
requisite value disclosed by Funkhouser 93. Blue Br. 34.
As both Bungie and the Board have confirmed, even with a no polygons at
all theory, Funkhouser 93 discloses that importance must be considered when
determining which objects will be omitted:
If levels of detail representing no polygons at all are allowed,

[then] this approach handles cases where the target frame time is not
long enough to render all potentially visible objects even at the
10
lowest level of detail. In such cases, only the most valuable

objects are rendered so that the frame time constraint is not violated.
Appx3976, Appx1931. Bungie did not include a substantive declaration from Dr.
Zyda on this disclosure, and therefore provided no testimony on how a POSITA
would have interpreted or understood Funkhouser 93s no polygons at all
scheme, or how a POSITA would have determined which objects would be the
most valuable. See Blue Br. 33, 36-37. This is a fundamental failure of proof
in Bungies challenges, and the defect carried over into the Boards decisions.
In its decisions, the Board focused on the possibility of a no polygons at
all setting in concluding that avatars could be omitted from a display, but also
failed to reconcile that finding with Funkhouser 93s disclosure that only the
most valuable objects are rendered under this scheme. Appx1931. This
constitutes the impermissible act of picking and choosing from Funkhouser 93
only so much of it as will support a given position to the exclusion of other parts
necessary to the full appreciation of what such reference fairly suggests .
Bausch & Lomb Inc. v. Barnes-Hind Inc., 796 F.2d 443, 448 (Fed. Cir. 1986)
(citing In re Wesslau, 353 F.2d 238, 241 (C.C.P.A. 1965); In re Mercier, 515
F.2d 1161, 1165-66 (C.C.P.A. 1975)).
11
v. Bungie Now Looks Beyond The Record Evidence In Search

Of Support For The Relative Importance Of Avatars
Searching the record for support, Bungie quoted the Boards inquiry at oral
hearing regarding an avatars value, but failed to see the deeper meaning of this
exchange. Red Br. 44-45. In the transcript, Judge Easthom creates a hypothetical
scenario where he allocates lower importance to avatars on the very edge of the
field of view, [since] those would be the least favorable ones, it would seem to
me. Appx0753-0754. But there is no record evidence to support this allocation
of avatar importance. Indeed, this snippet taints Bungies entire argument on
Funkhouser 93 because it confirms that importance must be considered before
Judge Easthom could conclude that avatars would have been limited or filtered.
Appx0753-0754.
Further, Judge Easthoms scenario defines importance based on an avatars
position and therefore fails to address the specific limitations of, inter alia, claim
8 of the 501 patent and claim 15 of the 998 patent. Claim 8 of the 501 patent
requires that determining comprises filtering the other user avatars based on at
least one variable other than (1) positions of the other user avatars, and (2)
orientation of the first user avatar. Appx0343(20:1-4). Filtering the other user
avatars based on positions on the very edge of the field of view is a variable
expressly excluded by claim 8. In claim 15 of the 998 patent, the selection of
displayed remote user avatars is independent of the relative position of the local
12
avatar and the remote user avatars not shown on the graphic display.
Appx0320(20:32-38). Without question, Judge Easthoms remarks on avatar
valuations do not remedy the defective Board decisions.
vi. Neither Funkhouser 93 nor Funkhouser 95 Discloses That

Avatars Are Treated As Objects
Both the Board and Bungie, without support from either Funkhouser
reference, assume an avatar from Funkhouser 95 could have been incorporated
into Funkhouser 93 and treated as an object. Appx0233-0234; Red Br. 36, 38;
Blue Br. 31-32. It is undisputed that Funkhouser 93 fails to disclose an avatar or
any graphical representation of a user. Appx0233-0234. Nor is there any
disclosure in the references that if an avatar were present in Funkhouser 93, it
would be treated as an object for purposes of display algorithms.
Bungie characterizes Worlds argument as an attack on the references
individually. Specifically, Bungie attacks this argument by stating: whether
Funkhouser 93 explicitly discloses avatars is irrelevant as Funkhouser 95 was
relied upon for the teaching . . . Red Br. 38 (citing Appx184, Appx233-234).
Bungie misses the point. The fact that a secondary reference discloses an element
does not mean that the element can be unconditionally incorporated into a system
to form the claimed combination. KSR Intl Co. v. Teleflex Inc., 550 U.S. 398,
418 (2007)(a patent composed of several elements is not proved obvious merely
13
by demonstrating that each of its elements was, independently, known in the prior
art.). The Board must have a rationale and support for turning the avatar from
Funkhouser 95 into a displayable object in Funkhouser 93. No rationale is
provided. Ball Aerosol v. Ltd. Brands, 555 F.3d 984, 993 (Fed. Cir.
2009)(holding that if there was an apparent reason to combine the known
elements in the fashion claimed by the patent, this analysis should be made
explicit.).
2. Funkhouser 93 Treats Books As Texture Of A Bookshelf Rather

Than Objects And Does Not Disclose Omitting Books Under A No
Polygons At All Embodiment
In addition to the no polygons at all scheme, the Board looks to the
missing books in Funkhouser 93s Figure 11c1 to conclude that it would have
been obvious to omit Funkhouser 95s avatars under Funkhouser 93s
optimization algorithm. Appx0235. But the Boards interpretation of
Funkhouser 93s books is also unsupported by substantial evidence and conflicts
with Funkhouser 93s disclosure. Moreover, the Board failed to reconcile the
portions of Funkhouser 93 that are inconsistent with the Boards findings. See,
e.g., Appx0185; Appx0234-0235.
While Funkhouser 93 discloses that books are present in one image and
absent from another, the reference treats the books as bookshelf texture rather
14
than as separate objects. Appx1933-1934, Appx3399; Blue Br. 33-34. Thus, the
optimization algorithm results in the bookshelf object being displayed with
reduced texture. The reduced bookshelf texture results in books being omitted
from display, but the omission of books is not the result of Funkhouser 93
analyzing each book as a separate object. Blue Br. 33-34.
This interpretation is confirmed by Funkhouser 93s discussion of the
optimization algorithm used to generate the images shown in Figure 11.
Funkhouser 93 introduces the algorithm by explaining that [e]ach object is
rendered at the LOD [level of detail] chosen by the cost/benefit optimization
algorithm described in Sections 3 and 6 and also explains that in performing
this algorithm, the Benefit heuristic is limited to consideration of object size in
this test, i.e. all other Benefit factors are set to 1.0. Appx1933. While discussing
the images of Figure 11, Funkhouser 93 discloses that the levels of detail chosen
for the objects are shown in Figure 11c3. Appx1934, Appx1936 (darker shades
of gray represent higher LODs.) While the only change to the Benefit heuristic
was based on object size, Figure 11c3 clearly shows that the books and the
bookshelf, despite being different sizes, are the same shade of gray. Appx1936.
This confirms that Funkhouser 93 treats the bookshelf and books as a single
object having a uniform Benefit heuristic, and treats the books as the bookshelfs
texture.
15
Moreover, the Board had no basis to conclude that the images in Figure
11c1 were generated using the no polygons at all scheme disclosed as a separate
embodiment in Funkhouser 93. Appx0236-0237. Dr. Zyda provided no
testimony on that disclosure (which Bungie first pointed to in its Reply), and
Funkhouser 93 itself provides no such teaching. Appx1935. There is no
evidence, much less substantial evidence, to support the Boards conclusion.
3. The Board Failed To Articulate A Proper Motivation To Combine

Funkhouser 95 and Funkhouser 93
The Boards conclusion on obviousness is equally deficient for want of
specific findings regarding the proposed combination of Funkhouser 93 and
Funkhouser 95. Blue Br. 43-48 (citing In re NuVasive, 842 F.3d 1376, 1382
(Fed. Cir. 2016)). The Boards statement that the references are complementary
and could function together does not articulate a motivation to combine.
Specifically, Bungie cites in its Brief:
(i) it would have been a simple matter to add the process taught in
Funkhouser 93 to the system described in Funkhouser [95] (Red
Br. 47); and
(ii) the optimization objectives of both Funkhouser 93 and Funkhouser
95 are not incompatible. (Red Br. 47)
16
Bungie then alleges, without citations, that [i]n other words, the Board
specifically found that the reason to combine Funkhouser 95 and Funkhouser 93
was to provide a client system that determined which objects, including avatars,
to display . . . Red Br. 48 (emphasis added). This language does not appear in
the Boards decision. The Board failed to provide a reasoned basis for the alleged
motivation to combine the Funkhouser references, and this Court does not
supply a reasoned basis for the agencys action that the agency itself has not
given. Bowman Transp., Inc. v. Ark.-Best Freight Sys., Inc., 419 U.S. 281, 285
86 (1974); SEC v. Chenery Corp., 332 U.S. 194, 19697 (1947).4
Further, even if the Board had issued the finding represented by Bungie
(Red Br. 48), this purported reason for combining two references starts with the
desired result defined by the challenged claims, and contends that the references
could be combined to achieve that result. Such a hindsight-driven explanation
has been repeatedly rejected by this Court. Insite Vision Inc. v. Sandoz, Inc., 783
F.3d 853, 859 (Fed. Cir. 2015)(Defining the problem in terms of its solution
reveals improper hindsight . . . (quoting Monarch Knitting Mach. Corp. v. Sulzer
4
Bungie states that Worlds did not specifically contest motivation in one
proceeding. Red Br. 52. Worlds did not concede this point (Appx5142) and
argued it extensively at the hearing with slide 47. See e.g. Appx0751, Appx0757-
0758.
17
Morat GmbH, 139 F.3d 877, 881 (Fed. Cir. 1998))); Mintz v. Dietz & Watson,
Inc., 679 F. 3d 1372, 1377 (Fed. Cir. 2012).
Further, just because a POSITA could have combined the references does
not mean that a POSITA would have combined them. Personal Web
Technologies, LLC v. Apple, Inc., 848 F.3d 987, 99394 (Fed. Cir. 2017).
Bungies logic fails to meet the evidence-supported account required to set forth a
motivation to combine the references. Id. at 994; Blue Br. 47.
Having found no motivation articulated in the Boards decision, in
Bungies petitions, or in the hearing transcript, Bungie next attempts to find an
articulated motivation to combine in the declaration of Dr. Zyda and to attribute
that statement to the Board. Red Br. 48-50. This is inappropriate.
First, an after-the-fact review of the experts declaration for a motivation to
combine statement is improper. The Board must articulate its motivation to
combine and its reasoning to enable a proper review by this Court. Blue Br. 44-
45.
Second, Dr. Zydas declaration simply explains that the two Funkhouser
references describe techniques to reduce client workstation burden. Appx4110-
4111(162-163); see also Red Br. 49-50. The fact that both references describe
techniques to reduce client workstation burden at best shows the references are
analogous. However, being analogous art is only one the Graham factors and
18
does not establish obviousness. Graham v. John Deere Co. of Kansas City, 383
U.S. 1, 17 (1966). Importantly, Dr. Zyda does not explain why a POSITA in
possession of one Funkhouser reference would be motivated to combine it with
the other reference.
In sum, the Boards decisions lack the evidence-based accounts necessary
to conclude that a skilled artisan would have been motivated to combine the
Funkhouser references, and therefore do not support obviousness of the claims-at-
issue.
For all the reasons explained above, the Court should vacate the Boards
decision that claims 8 and 10 of the 501 patent, and claims 13-15 of the 998
patent, are unpatentable as obvious over Funkhouser 93 in combination with
other art of record. The evidence does not support this conclusion, and the Board
offered insufficient reasoning to support its decision.
B. The Boards Real Party In Interest Ruling Must Be Overturned
1. The Board Improperly Shifted The Burden Of Proof On Real Party

In Interest
The Board committed a clear error of law by improperly shifting the
burden of disproving Bungies identification of all real parties in interest to
Worlds, and therefore applied the incorrect standard in deciding whether Bungie
19
had fully and accurately named all real parties in interest. Under Atlanta Gas
Light Co. v. Bennett Regulator Guards, Inc., IPR2013-00453, Paper 88 (PTAB
Jan. 6, 2015), rehg denied, Paper 91 (Feb. 23, 2015), the Board will generally
accept the petitioners identification of real parties in interest at the time of filing
the petition. Id. at 7 (citations omitted). But this acceptance serves only as a
rebuttable presumption under Fed. R. Evid. 301, and once a patent owner
provides sufficient rebuttal evidence that reasonably brings into question the
accuracy of a petitioners identification of the real parties in interest, the burden
remains with the petitioner to establish that it has complied with the statutory
requirement to identify all the real parties in interest. Id. at 8 (emphasis
added). By statute, the burden of persuasion on this issue remains at all times
squarely on petitioner. Id. at Paper 91, 6-7.
Bungie denies that the Board improperly shifted the burden to Worlds.
Red Br. 55-56. But the Boards decisions, which repeatedly take Worlds to task
for failing to prove that Activision is an unnamed real party in interest, say
otherwise. Blue Br. 53-56. If this Court agrees that the Boards determination on
the real party in interest is subject to review for the reasons previously briefed
(see Blue Br. 49-52), the Boards decision cannot stand. Appx0258-0259.
20
2. Worlds Supplied At Least The Minimum Quantum Of Evidence

Required To Rebut Bungies Presumption
Bungie does not dispute that the test for whether Worlds rebutted the
presumption includes: a) weighing all evidence in the light most favorable to
Worlds (Blue Br. 61); and b) requiring only a minimum quantum of evidence to
rebut Bungies presumption (Blue Br. 56). Once the presumption bubble is burst,
the presumption completely vanishes upon the introduction of evidence
sufficient to support a finding of the nonexistence of the presumed fact. A.C.
Aukerman Co. v. R.L. Chaides Construction Co., 960 F.2d 1020, 1037 (Fed. Cir.
1992) (en banc) (citations omitted) (emphasis added). Worlds met this minimum
quantum with the Agreement that gave Activision the contractual right to oversee
Bungies mandatory legal reviews (Appx2924), and the letter in which Worlds
notified Activision that it intended to add Bungies Destiny products to the
Worlds-Activision litigation. Appx2944.
Viewed in the light most favorable to Worlds, the Agreement reasonably
brings into question the accuracy of [Bungies] identification of the real parties in
interest (Atlanta Gas, Paper 88 at 8), and the Board should have concluded that
Worlds met the minimum quantum of evidence. As a result, Bungies
presumption was burst and should have vanished completely. Absent that
21
presumption, there was no evidence to support Bungies position. Blue Br. 63-
65.
In response, Bungie misstates the quantum of evidence that Worlds needed
to produce to burst the rebuttable presumption. Specifically, Bungie alleges that
Worlds failed to provide [s]ubstantial [r]ebuttal [e]vidence [t]hat Activision
[w]as a [r]eal [p]arty-[i]n-[i]nterest. Red Br. 55. This misstates both the
evidentiary burden and the purpose of Worlds evidence. First, Worlds was not
required to produce substantial rebuttal evidence under the Boards own
standard, but rather only sufficient rebuttal evidence. Atlanta Gas, Paper 88 at
8 (emphasis added). Second, Worlds was not required to provide evidence that
Activision was a real party in interest. Instead, to burst Bungies rebuttable
presumption, Worlds was simply required to provide the minimum quantum of
evidence necessary to reasonably bring[ ] into question the accuracy of a
petitioners identification of the real parties in interest. Id.
Bungie also turns to the Office Patent Trial Practice Guide, 77 Fed. Reg.
48,756, 48,759 (Aug. 13, 2012) (Practice Guide) for the Offices citation to
Gonzalez v. Banco Cent. Corp., 27 F.3d 751 (1st Cir. 1994). Red Br. 57. There,
the Practice Guide recognized the need to consider the totality of the
circumstances when considering whether a non-party exercised control over a
proceeding. Practice Guide at 48,759; Gonzalez, 27 F.3d at 759; but see Atlanta
22
Gas, Paper 91 at 4 n.1(Gonzalez not entirely applicable here). Here, Bungies
reliance on Gonzalez rings hollow. The sole record evidence on the issue of real
party in interest is the Agreement, which Worlds introduced. By denying
Worlds motions for discovery, the Board artificially limited the amount of
circumstances available for consideration. Appx0432. Similarly, Bungie
elected to proceed without any further evidence in the record. Together, the
Board and Bungie ensured that the question of Activisions control over (or
opportunity to control) these proceedings was decided on far less than the
totality of the circumstances.
3. Contract Interpretation Is A Matter Of Law And Is Reviewable De

Novo
Bungie also fails to understand that the Boards interpretation of the
Agreement, the pivotal evidence on real party in interest, is not entitled to
deference. Contract interpretation is not a factual finding but a question of law.
Ethicon, Inc. v. U.S. Surgical Corp., 135 F.3d 1456, 1466 (Fed. Cir. 1998) (This
court reviews the interpretation of contractual language, including license
agreements, as a question of law.). The Federal Circuit reviews the PTAB's
legal conclusions de novo. Redline Detection, LLC v. Star Envirotech, Inc., 811
F.3d 435, 449 (Fed. Cir. 2015) (citation omitted).
23
4. The Boards Contract Interpretation Is Incorrect
Moreover, the Boards interpretation of the Agreement improperly treats
Worlds contract interpretation arguments as assumptions. But the Board should
have viewed the Agreement in the light most favorable to Worlds. And viewed in
that light, the Agreement includes terms that reasonably can and should have been
construed in Worlds favor. Blue Br. 64-65.
On its face, the Agreement requires Bungie to indemnify Activision for
claims5 of patent infringement against Destiny, and further gives Activision the
contractual right to review, approve, and budget Bungies mandatory legal
reviews related to intellectual property. Blue Br. 59-62. For example, Bungie
warrants that the use, development, distribution and publishing of the product
intellectual property shall not infringe upon or violate the rights of, nor require
consent of, any other party. Appx2933. Worlds litigation correspondence to
Activision placed this warranty in question and reasonably triggered Bungies
indemnification obligation. Appx2924.
5
The Agreement requires indemnification for claims which may arise
even if a litigation has not commenced. Under Section 15.1, Bungies
indemnification obligation is triggered by Claims, which are defined to include
not just suits, but also liabilities, claims, costs and expenses, including
reasonable attorneys fees . . . arising out of or related to (i) any breach . . . of its
representations or warranties . . . or (ii) any infringement . . . Appx2935.
24
The Agreement also provides Activision with the contractual opportunity
to oversee Bungies defense of the Destiny products, particularly once Worlds put
Activision on notice of its claims against the Destiny products. Section 7A.15(j)
requires Bungie to conduct legal reviews of the Destiny Products to ensure
that all Intellectual Property and other rights are fully cleared for use. Appx2924.
These legal reviews by Bungie are subject to prior review and approval of
Activision, (budget to [be] mutually approved). Appx2924. Bungie does not
dispute that it performed legal reviews prior to filing its IPR petitions, but
opposes the plain language interpretation of the Agreement by pointing to section
10.1 and 14.1 of the Agreement. Red Br. 58. Neither of those sections overrides
the express language of Section 7A.15. Appx2924. In fact, this alternative
interpretation taken by the Board and Bungie is contrary to law and is not viewed
in the light most favorable to Worlds. Appx0259, Appx0506-0510.
By the express terms of the Agreement, Activision had at minimum an
opportunity to control the contents of the petitions for IPR through, inter alia, its
contractual right to review, approve, and budget Bungies legal reviews
underlying the IPR petitions. Appx0473-0474.
Despite this reasonable contract interpretation which burst Bungies
rebuttable presumption, the Board improperly reasoned that Patent Owner has
not shown that this proceeding falls within the scope of a legal review[] of the
25
Products under 7A.15(j), such that the Agreement would give Activision a
right of review and approval related to this proceeding. Appx0507, Appx3874,
Appx5092 (emphasis added). But Worlds was not required to prove such fact. It
was only required to reasonably call into question whether Activision had and
exercised such a right, and the Agreement satisfies this requirement. Atlanta Gas,
Paper 88 at 8.
Just as the Board improperly shifted the burden of proof to Worlds, the
Board also incorrectly viewed the Agreement in the light most favorable to
Bungie. For example, the Board concluded that the legal reviews that Bungie
was obligated to conduct, and which Activision had the opportunity to approve,
review, and budget for, would have been of the Destiny products, not the Worlds
patents. Appx0429. Similarly, the Board decided that the IPRs against
Appellants patent did not involve any product. Appx0507, Appx3874,
Appx5092. But a legal review performed to ensure that all Intellectual Property
and other rights are fully cleared for use necessarily would include the review of
patent scope of known patents (Appx2924), including the Worlds patents that
Activision was actively litigating. Further, between Worlds and Bungie, it was
Bungie who possessed the evidence and/or witness that could illuminate
Activisions involvement (or lack thereof) in the legal reviews underlying
Bungies IPR petitions. In an abuse of discretion based on its unsupported
26
contract interpretation viewed in the light most favorable to Bungie, the Board
denied Worlds request for discovery into whether Activision was an unnamed real
party in interest. Appx0429-0432.
Further, the Practice Guide explains that a real party in interest is a party
that desires review of the patent being challenged, and may be the petitioner
itself, and/or it may be the party or parties at whose behest the petition has been
filed. Practice Guide at 48,749. Given Activisions contractual relationship
with Bungie and lengthy litigation with Worlds, Activision fits the character of a
party who desires review of the Worlds patents. Activision is not required to
actually control the proceedings to be a real party in interest. Id. at 48,760.
5. Bungie Produced No Evidence, Let Alone Sufficient Evidence, To

Carry Its Burden of Production
In arguing that it met both its burden of production and burden of
persuasion, Bungie seeks to diminish its decision to limit the record evidence on
real party in interest. Red Br. 59-60. For example, Bungie now argues that it
was entitled to rely on the same piece of evidence relied upon by Worlds:
namely, the [ ] Agreement itself. Red Br. 60. But the Agreement cannot prove
Activisions lack of involvement in the IPR petitions. As Bungie admits, the
Agreements effective date is April 16, 2010, before Worlds put Activision on
notice that it intended to add the Bungie-developed Destiny product to the
27
Worlds-Activision litigation and before IPR proceedings even existed. Red Br.
58 n.11. While the Agreement proves Bungies obligation to indemnify and
conduct legal reviews subject to Activisions review, all of which gave Activision
an opportunity to control the IPR petitions below (Blue Br. 59-65), it does not
prove the opposite.
Bungie also disparages as attorney argument Worlds interpretation of
the Agreement giving Activision the ability to control the proceedings. Red Br.
60. But Bungie came forward with no facts to undercut Worlds contract
interpretation. Further, the Board was required to view the Agreement in the light
most favorable to Worlds, and Worlds was not required to prove Activisions
status. It was only required to burst Bungies presumption.
Bungie now complains that Worlds position would require Bungie to
provide some evidence other than the [ ] Agreement that would prove a negative
of a fact. Red Br. 59. But Bungie could have submitted a declaration to prove
its real party in interest assertion6. 37 C.F.R. 42.63(a) (2016). Instead, Bungie
produced no evidence establishing that it was the sole real party in interest. Red
Br. 59-60. Further, the Board compounded its own errors below by crediting
6
The Boards regulations also permit opponents to cross-examine the
declarants on their declarations as a matter of right (see 37 C.F.R.
42.51(b)(1)(ii) (2016)); Bungie was able to avoid cross-examination by electing
not to submit a declaration to prove a negative of a fact. Red Br. 59.
28
Bungies unsworn attorney argument, rather than sworn testimony or evidence, in
noting that Petitioner has expressly denied any control or funding of this
proceeding by Activision. Appx0510, Appx3877, Appx5094. Even assuming
that Activision did not actually control the filing of the IPRs leading to this
appeal, Activision had an opportunity to control the proceedings. In the requisite
analysis of whether Worlds burst Bungies presumption, the opportunity to
control was enough. Practice Guide, 48,759 (listing factors for determining real
party in interest, including whether the third party exercised or could have
exercised control over the proceeding.).
6. Bungie Does Not Contest The Importance Of Real Party In Interest

To This Case
Bungies Response Brief is also notable for what it does not contest. In
particular, Bungie does not contest that Worlds served complaints asserting patent
infringement of the patents-at-issue against Activision more than one year before
Bungies IPR petitions were filed. Blue Br. 66 (citing Appx2942-2943,
Appx2995-2998, Appx4902-4903, Appx4906-4907). Bungie does not contest
that Worlds put Activision on notice on November 13, 2014 that it intended to
add a software-based game called Destiny, developed by Bungie and
distributed by Activision pursuant to the Agreement, as an accused product in the
Worlds-Activision litigation. Blue Br. 59 (citing Appx2944). Bungie does not
29
contest that by November 13, 2014, Activision was time-barred from filing any
IPR petition against the patents-at-issue. See 35 U.S.C. 315(b) (2011). Blue
Br. 59, 66. The only questions that remain are whether the Board properly
considered the Agreement, and interpreted it in the light most favorable to
Worlds. The record is clear that the Board failed on both accounts.
7. Collateral Estoppel Does Not Bar Review Of Real Party In Interest
Finally, contrary to Bungies Response, collateral estoppel does not apply
to the real party in interest determination. At a fundamental level, issues directly
related to an agencys statutory authority cannot be estopped. United States v.
Utah Contr. & Mining Co., 384 U.S. 394, 422 (1966)(matters must be properly
before the Board). Since the real party in interest determination is a
jurisdictional issue defining the agencys statutory authority (35 U.S.C. 315(b)),
collateral estoppel cannot apply.
Additionally, the Boards real party in interest determination fails to satisfy
a number of factors required for collateral estoppel. The test for application of
collateral estoppel to an agency decision is set forth in United States v. Utah
Constr. & Mining Co. and requires satisfaction of both the traditional elements of
collateral estoppel and the Utah Construction test. Under the Utah Construction
test, (1) the agency must have jurisdiction to resolve the issue; (2) the agency
30
must act in a judicial capacity and must follow procedures sufficiently similar to
those used during trials; (3) the agency must properly resolve the dispute before
it; and (4) the parties must have an adequate opportunity to litigate. Utah Constr.
& Mining, 384 U.S. at 422; Univ. of Tenn. v. Elliott, 478 U.S. 788, 799 (1986).
Here, the Board refused Worlds request for discovery into whether
Activision was an unnamed real party in interest (Appx0429-0432), thereby
depriving Worlds of discovery procedures similar to those used during trials and
denying procedural advantages and opportunities to litigate that would have been
granted by a court. This places grave doubt over the quality, extensiveness, and
fairness of the procedures followed. As this Court has held, [r]edetermination of
issues is warranted if there is reason to doubt the quality, extensiveness, or
fairness of procedures followed in prior litigation. In re Freeman, 30 F.3d 1459,
1467 (Fed. Cir. 1994) (quoting Montana v. U.S., 440 U.S. 147, 164 n.11 (1979)).
Further, by incorrectly shifting the burden and interpreting the Agreement not in
accordance with law, the Board failed to properly resolve the issue. Therefore,
the Boards decisions also fail to meet requirements 2, 3, and 4 of the Utah
Construction test.
Moreover, collateral estoppel based on a prior agency decision is generally
limited to findings of fact and, in some instances, mixed findings of fact and law.
In the administrative context, courts have hesitated to apply collateral estoppel
31
effect to determinations of law. See NLRB v. Markle Mfg. Co. of San Antonio,
623 F.2d 1122, 1126 (5th Cir. 1980) (collateral estoppel [is] not normally
applied to conclusions of law made by administrative agencies) (citing Mosher
Steel Co. v. NLRB, 568 F.2d 436 (5th Cir. 1978)); but see Wickham Contracting
Co. Inc. v. Board of Educ. of City of New York, 715 F.2d 21, 26 (2d Cir. 1983)
(allowing preclusive effect to agency determination of law). Contract
interpretation is a question of law and the Boards determination that Activision is
not a real party in interest is founded solely upon its incorrect Agreement
interpretation.
Finally, the current appeal is not a subsequent action to the proceedings
below. Instead, this appeal stems from the same consolidated handling of the
named IPRs at the Board.
For each of these reasons, collateral estoppel does not apply to Worlds
challenge of the Boards determination of the real party in interest.
32
CONCLUSION AND RELIEF REQUESTED
The Boards determination that the claims-at-issue were obvious is
unsupported by substantial evidence. Further, the Board improperly weighed the
evidence that reasonably raised the question of whether Activision is a real party
in interest against Worlds, and acted ultra vires in instituting the underlying IPRs.
Accordingly, Worlds respectfully requests that this Court vacate the Boards Final
Written Decisions and dismiss these proceedings, or in the alternative, remand to
the Board for further action consistent with this Courts Opinion.
September 22, 2017 Respectfully submitted,
/s/ Wayne M. Helge

Wayne M. Helge
Aldo Noto
Gregory A. Krauss
DAVIDSON BERQUIST JACKSON & GOWDEY,
LLP
McLean, VA 22102
(571) 765-7700
Counsel for Appellant Worlds Inc.
33
United States Court of Appeals

for the Federal Circuit
Worlds Inc. v. Bungie, Inc., 2017-1481, -1546, -1583
CERTIFICATE OF SERVICE
I, Robyn Cocho, being duly sworn according to law and being over the age
of 18, upon my oath depose and say that:
Counsel Press was retained by DAVIDSON BERQUIST JACKSON &

GOWDEY, LLP, counsel for Appellant to print this document. I am an employee
of Counsel Press.
On September 22, 2017, counsel has authorized me to electronically file
the foregoing Reply Brief for Appellant with the Clerk of Court using the
CM/ECF System, which will serve via e-mail notice of such filing to all counsel
registered as CM/ECF users, including the following principal counsel for the
other parties:
Michael T. Rosato
Wilson, Sonsini, Goodrich & Rosati, PC
701 Fifth Avenue, Suite 5100
Seattle, WA 98104
206-883-2529
mrosato@wsgr.com
Counsel for Appellee
Paper copies will also be mailed to the above principal counsel at the time paper
copies are sent to the Court.
Upon acceptance by the Court of the e-filed document, six paper copies
will be filed with the Court within the time provided in the Courts rules.
September 22, 2017 /s/ Robyn Cocho

Counsel Press
CERTIFICATE OF COMPLIANCE WITH TYPE-VOLUME

LIMITATION, TYPEFACE REQUIREMENTS AND TYPE STYLE
REQUIREMENTS
1. This brief complies with the type-volume limitation of Federal Rule of

Appellate Procedure 32(a)(7)(B) or Federal Rule of Appellate Procedure 28.1(e)
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of the brief exempted by Federal Rule of Appellate Procedure
32(a)(7)(B)(iii),or
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September 22, 2017 /s/ Wayne M. Helge

Date Wayne M. Helge
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Worlds Reply Bungie v. Worlds Appellate For PTAB

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Case: 17-1481 Document: 32 Page: 1 Filed: 09/22/2017

Nos. 2017-1481, -1546, -1583

United States Court of Appeals

On Appeal from the United States Patent and Trademark Office

APPELLANTS REPLY BRIEF

Counsel for Appellant Worlds Inc.

SEPTEMBER 22, 2017

COUNSEL PRESS, LLC (888) 277-3259

Appellant WORLDS INC. certifies the following:

1. The full name of every party represented by me is WORLDS INC.

2. The real party in interest is the same as the party represented,

3. There is no parent corporation or publicly held company that owns

10% or more of stock in WORLDS INC.

the current case:

/s/ Wayne M. Helge

CERTIFICATE OF INTEREST .......................................................................... i

TABLE OF CONTENTS .................................................................................... ii

TABLE OF AUTHORITIES ............................................................................. iv

A. Funkhouser 93 In Combination With the Other Art of

1. There is No Record Evidence To Support the Boards

i. The Record Contains No Evidence On The Value Of

ii. There Is No Evidence That Avatars Would Fall

iii. There Is No Evidence That Some Avatars Would Be

iv. Bungie Failed To Fully Develop Its Funkhouser 93

v. Bungie Now Looks Beyond The Record Evidence In

vi. Neither Funkhouser 93 nor Funkhouser 95

2. Funkhouser 93 Treats Books As Texture Of A

3. The Board Failed To Articulate A Proper Motivation To

B. The Boards Real Party In Interest Ruling Must Be

1. The Board Improperly Shifted The Burden Of Proof On

2. Worlds Supplied At Least The Minimum Quantum Of

3. Contract Interpretation Is A Matter Of Law And Is

4. The Boards Contract Interpretation Is Incorrect ..............................24

5. Bungie Produced No Evidence, Let Alone Sufficient

6. Bungie Does Not Contest The Importance Of Real Party

7. Collateral Estoppel Does Not Bar Review Of Real Party

CONCLUSION AND RELIEF REQUESTED .................................................33

A.C. Aukerman Co. v. R.L. Chaides Construction Co.,

Atlanta Gas Light Co. v. Bennett Regulator Guards, Inc.,

Ball Aerosol v. Ltd. Brands,

Bausch & Lomb Inc. v. Barnes-Hind Inc.,

Bowman Transp., Inc. v. Ark.-Best Freight Sys., Inc.,

Ethicon, Inc. v. U.S. Surgical Corp.,

Gonzalez v. Banco Cent. Corp.,

Graham v. John Deere Co. of Kansas City,

Insite Vision Inc. v. Sandoz, Inc.,

KSR Intl Co. v. Teleflex Inc.,

Mintz v. Dietz & Watson, Inc.,

Monarch Knitting Mach. Corp. v. Sulzer Morat GmbH,

Mosher Steel Co. v. NLRB,

NLRB v. Markle Mfg. Co. of San Antonio,

Personal Web Technologies, LLC v. Apple, Inc.,

Redline Detection, LLC v. Star Envirotech, Inc.,

SEC v. Chenery Corp.,

United States v. Utah Contr. & Mining Co.,

Univ. of Tenn. v. Elliott,

Wickham Contracting Co. Inc. v. Board of Educ. of City of New York,

35 U.S.C. 315(b) (2011) .................................................................................. 30

37 C.F.R. 42.63(a) (2016) ................................................................................ 28

37 C.F.R. 42.51(b)(1)(ii) (2016) ...................................................................... 28

Fed. R. Evid. 301 ................................................................................................ 20

Office Patent Trial Practice Guide,

any reference. Appx0233-0236. The Boards decision on these claims must be