IN THE UNITED STATES PATENT AND TRADEMARK OFFICE

Transcription

1 IN THE UNITED STATES PATENT AND TRADEMARK OFFICE In re Patent of: Imes et al. U.S. Patent No.: 8,571,518 Attorney Docket No.: IP2 Issue Date: October 29, 2013 Appl. Serial No.: 13/662,663 Filing Date: October 29, 2012 Title: PROXIMITY DETECTION MODULE ON THERMOSTAT Mail Stop Patent Board Patent Trial and Appeal Board U.S. Patent and Trademark Office P.O. Box 1450 Alexandria, VA PETITION FOR INTER PARTES REVIEW OF UNITED STATES PATENT NO. 8,571,518 PURSUANT TO 35 U.S.C , 37 C.F.R. 42

2 TABLE OF CONTENTS I. INTRODUCTION... 1 II. MANDATORY NOTICES UNDER 37 C.F.R A. Real Party-In-Interest Under 37 C.F.R. 42.8(b)(1)... 2 B. Related Matters Under 37 C.F.R. 42.8(b)(2)... 3 C. Lead And Back-Up Counsel Under 37 C.F.R. 42.8(b)(3)... 3 D. Service Information... 3 III. PAYMENT OF FEES 37 C.F.R IV. REQUIREMENTS FOR IPR UNDER 37 C.F.R A. Grounds for Standing Under 37 C.F.R (a)... 4 B. Challenge Under 37 C.F.R (b) and Relief Requested... 4 C. Claim Construction under 37 C.F.R (b)(3) the thermostat includes a generally round housing BRI of terms for which Patent Owner proposed constructions in co-pending litigation... 6 V. SUMMARY OF THE 518 PATENT... 8 VI. A. Brief Description... 8 B. Summary of the Original Prosecution on the 518 Patent THERE IS A REASONABLE LIKELIHOOD THAT AT LEAST ONE CLAIM OF THE 518 PATENT IS UNPATENTABLE VII. GROUNDS 1-3: ROSENBLATT A. [GROUND 1] Anticipation of claims 1 and 8 by Rosenblatt B. [GROUND 2] Obviousness of claims 2 and 3 under 103 over Rosenblatt in view of Chapman C. [GROUND 3] Obviousness of claims 9 and 12 under 103 over Rosenblatt in view of Nicodem VIII. GROUNDS 4-6: ROSENBLATT IN VIEW OF EHLERS A. [GROUND 4] Obviousness of claims 1 and 4-8 under 103 over Rosenblatt in view of Ehlers B. [GROUND 5] Obviousness of claims 2 and 3 under 103 over Rosenblatt in view of Ehlers and Chapman i

3 C. [GROUND 6] Obviousness of claims 9 and 12 under 103 over Rosenblatt in view of Ehlers and Nicodem IX. NON-REDUNDANCY GROUNDS SET FORTH X. CONCLUSION ii

4 EXHIBITS NEST NEST NEST Declaration of Geoff Williamson. U.S. Patent 8,571,518 to Imes et al. ( the 518 patent ) Select Prosecution History of the 518 patent (App. No. 13/662,663) NEST NEST NEST NEST NEST NEST NEST NEST U.S. Patent 7,130,719 to Ehlers et al. ( Ehlers ) Reserved U.S. Pub. 2007/ to Chapman, Jr. et al. ( Chapman ) Reserved U.S. Pub. 2008/ to Nicodem et al. ( Nicodem ) U.S. Pub. 2005/ to Pouchak ( Pouchak ) U.S. Pub. 2010/ to Rosenblatt et al. ( Rosenblatt ) U.S. App. No. 60/368,963 to Ehlers et al. ( Ehlers Provisional ) NEST Joint Claim Construction Statement for U.S. Pat. No. 8,571,518 iii

5 I. INTRODUCTION Nest Labs, Inc. ( Petitioner or Nest ) petitions for Inter Partes Review under 35 U.S.C and 37 C.F.R. 42 of claims 1-9 and 12 of U.S. Patent 8,571,518 ( the 518 Patent ). Nest has a reasonable likelihood of establishing at least one claim identified in this Petition as unpatentable. Patent Owner in district court has accused the Nest Learning Thermostat (NLT) of infringing claims of the 518 patent that were drafted after the NLT was introduced. Those claims address, in a thermostat having a proximity detection module with home and away modes, alter[ing] an operating condition of the thermostat during the away mode in response to [a] detected presence of [a] user. For example, a temperature set point can be changed based on a determination that the user s cellphone is at or near a home that the thermostat serves. In the sole reference applied in prosecution, Pouchak, a user specified a schedule of times at which Occupied and Unoccupied modes would be active (see FIG. 9H). The original Examiner allowed the patent after Patent Owner argued that: (1) Pouchak fails to make a single mention of determining or detecting a physical 1

6 presence of a user at a site, and (2) Pouchak does not disclose that a detected presence of a user at a site (or lack thereof) is a separate and distinct limitation from an enabled away mode of the proximity detection module. NEST at (emphasis in original). But detected presence/absence is in prior art on which the Examiner did not rely e.g., Rosenblatt is an Apple published application that discusses various ways an iphone and similar devices can be used to control external systems, including changing thermostat set points based on a distance of a mobile device from a site. NEST at FIG. 71B, 71C, 99, 314, Rosenblatt refers to this as Use Location-Based Settings. NEST at 318. Rosenblatt also shows separate home and away modes by disclosing that Use Location-Based Settings (1000) can be turned on and off. NEST at FIG. 71B, 71C, 318. A first set of grounds shows anticipation by Rosenblatt of claims 1 and 8, and for certain dependent claims, shows obviousness by Rosenblatt in view of Chapman and Rosenblatt in view of Nicodem (Grounds 1-3). A second set of rejections is provided to show obviousness of the claims based on the same references as in Grounds 1-4 in further view of Ehlers (Grounds 4-6). II. MANDATORY NOTICES UNDER 37 C.F.R 42.8 A. Real Party-In-Interest Under 37 C.F.R. 42.8(b)(1) Nest Labs is the real-party-in-interest. Nest Labs is a wholly-owned subsid- 2

7 iary of Google Inc. Neither company disputes in this proceeding that PTO rules regarding privies and real parties in interest apply to both of them. B. Related Matters Under 37 C.F.R. 42.8(b)(2) Patent Owner asserts the 518 patent in the litigation styled Allure Energy, Inc. v. Nest Labs, Inc., et al., Case Number 9:13-cv RC, Eastern District of Texas, Lufkin Division. Also asserted in the same litigation are related U.S. Patents 8,442,695 and 8,509,954. All three patents are subject to IPR petitions previously filed. See IPR , IPR , and IPR C. Lead And Back-Up Counsel Under 37 C.F.R. 42.8(b)(3) Petitioner provides the following designation of counsel. LEAD COUNSEL BACKUP COUNSEL BACKUP COUNSEL John Dragseth (Reg. No. 42,497) 3200 RBC Plaza 60 South Sixth Street Minneapolis, MN Tel: Fax: D. Service Information Stuart A. Nelson (Reg. No. 63,947) 3200 RBC Plaza 60 South Sixth Street Minneapolis, MN Tel: Fax: Kevin X. McGann (Reg. No. 48,793) White & Case LLP 1155 Ave. of the Americas New York, NY Tel: Fax: Address all correspondence and service to the address of all counsel above. Petitioner also consents to electronic service at III. PAYMENT OF FEES 37 C.F.R Petitioner authorizes the PTO to charge Deposit Account No for 3

8 the petition fee set in 37 C.F.R (a), and for any additional fees. IV. REQUIREMENTS FOR IPR UNDER 37 C.F.R A. Grounds for Standing Under 37 C.F.R (a) Petitioner certifies that the 518 patent is available for IPR and that Petitioner is not barred or estopped from requesting IPR. B. Challenge Under 37 C.F.R (b) and Relief Requested Petitioner requests IPR of claims 1-9 and 12 on the grounds listed in the table below. In support, this Petition includes a supporting evidentiary declaration of Geoff Williamson. NEST Ground Claims Basis for Rejection Ground 1 1 and Rosenblatt Ground 2 2 and Rosenblatt in view of Chapman Ground 3 9 and Rosenblatt in view of Nicodem Ground 4 1 and Rosenblatt in view of Ehlers Ground 5 2 and Rosenblatt in view of Ehlers and Chapman Ground 6 9 and Rosenblatt in view of Ehlers and Nicodem Ehlers (2006), Chapman (2007), and Nicodem (May 2008) were all published more than a year before the 518 patent s earliest-recited priority of August 21, 2009, and are 102(b) prior art. Rosenblatt was filed in September 2008, almost a year before August 21, 2009, and is prior art under at least 102(e). 1 Only 1 For simplicity, petitioner uses an August 21, 2009, priority, because all cited references are prior to that date, but Petitioner does not concede that any claim is enti- 4

9 two of these references, Ehlers and Rosenblatt, were cited during the 518 patent s prosecution but they were two of over 340 references that Applicant cited, and the Examiner did not mention or rely on either of them. C. Claim Construction under 37 C.F.R (b)(3) In the PTO, a claim in an unexpired patent receives its broadest reasonable interpretation ( BRI ) in light of the specification i.e., a claim term gets its plain meaning unless it is inconsistent with the specification. See 37 C.F.R (b). The BRI standard is broader than the standard applied in litigation. In the following paragraphs, Petitioner explains the proper BRI standard for certain claim terms, and ends with a table listing other claim terms for which the Petitioner provides Patent Owner s proposed litigation constructions (which Patent Owner must admit are encompassed by the BRI). See NEST at the thermostat includes a generally round housing In the 518 claims (e.g., claim 2), generally round is construed as any shape, including rectangular. This odd result is reached because: (a) the specification discloses only a rectangular thermostat, and (b) Patent Owner added generally round to the claims even though there is no support for a round thermostat tled to the benefit of provisional App. No. 61/235,798 (filed August 21, 2009) or provisional App. No. 61/255,678 (filed Oct. 28, 2009). 5

10 housing. Indeed, the Examiner confronted Patent Owner about the lack of support, and Patent Owner merely asserted that the figures need not show not essential features, and the generally round housing can merely be represented by the rectangular box of the housing 1130 currently illustrated in Figure 11. NEST at The specification must have some disclosure of a round thermostat, and the 518 patent at most states that an energy management system... can vary in size, shape, performance, functionality, and price, but this generic statement does not disclose the species of a round housing. NEST at 3:41-64; see, e.g., In re Lukach, 169 USPQ 795 (CCPA 1971). Because the Board will not raise a Section 112 issue, construing this term to exclude rectangular shapes would be inconsistent with the specification, and thus contrary to the rules for BRI. See In re Zletz, 893 F.2d at 321. As the only shape in the specification is rectangular, the meaning of generally round must include rectangular shapes. 2. BRI of terms for which Patent Owner proposed constructions in co-pending litigation Claim terms proximity detection module Patent Owner s Proposed Construction in Litigation PO Construction: software or firmware operating on a server, controller, or mobile device that determines the presence of a user or device, or the proximity of a user or device, based on data received 6

11 mode PO Construction: a particular function arrangement or condition home mode The construction should cover what Patent Owner advocates in litigation and what it pointed to in prosecution. Litigation: operating under parameters defined by: 1. the presence of a person or a device; or 2. the calculation, based on data received, that a person or device is approaching or is within a predefined distance. 2 Prosecution: a mode in which proximity detection is off. See, infra, Section V.B. away mode The construction should cover what Patent Owner advocates in litigation and what it pointed to in prosecution. Litigation: operating under parameters defined by: 1. the absence of a person or a device; or 2. the calculation, based on data received, that a person or device is moving away or is 2 The Applicant stated during prosecution that home mode is met by proximity detection being turned off. See, infra, Section V.B.; NEST at

12 beyond a predefined distance. Prosecution: a mode in which proximity detection is on. See, infra, Section V.B. detect a presence of a user at the site disposed at a PO Construction: determine or calculate, based on data received, that a person or device is at the site, is approaching the site, or is within a predefined distance of the site. PO Construction: put in place at a site site disposed thereon PO Construction: put in place thereon during the away PO Construction: while operating in the away mode mode All other claim terms, including the term thermostat, should be construed according to their ordinary meaning. V. SUMMARY OF THE 518 PATENT A. Brief Description In an effort to target Nest s NLT, Patent Owner has (a) used claim terms that do not appear in the 518 patent s detailed description (e.g., home mode and away mode ); and (b) picked select features from wholly different embodiments in the 62-column specification. The claims also have several antecedent problems. 8

13 Therefore, this section steps through certain features of claim 1 and discusses portions of the specification that may explain such features. Claim 1 generally recites a thermostat that: (a) communicates with a mobile device; (b) has a proximity detection module with home and away modes; and (c) has its proximity detection module configured to change an operating condition of the thermostat during the away mode in response to detecting a presence of a user at a site. Figure 13 shows the system, with a thermostat. Thermostat communicates with a mobile device. Claim 1 recites that the thermostat includes a communication module capable of communicating with a mobile device associated with the site e.g., thermostat 1320 communicates over network device 1330 with mobile device. NEST at 51: Thermostat has proximity detection module with home and away modes. Claim 1 recites a proximity detection module having a home mode and an away mode. The detailed description does not mention home or away modes, but Applicant asserted in prosecution that support is provided by a proximity detec- 9

14 tion selector... having an ON and OFF mode, as shown by Figure 7. NEST at Proximity detection on is away mode and off is home mode. Thermostat is configured to enable away mode. Claim 1 recites that said thermostat [is] configured to enable the away mode. The patent lacks disclosure of a thermostat enabling the away mode, but instead discloses an interface for a user to enable it: EMUI [Energy Management User Interface] 700 can also include a proximity detection selector 728 configured to enable proximity detection of one or more mobile devices. NEST at 42: Proximity detection module detects presence of user. Claim 1 recites that said proximity detection module is configured to: detect a presence of a user at the site. As noted above, the patent discusses the proximity detection module detecting presence only of a mobile device, e.g., proximity detection module

15 can... detect a location of mobile device 210 relative to site 202, and modify operating conditions of site 202 based on a proximity of mobile device 210 to site 202. NEST at 8: Operating condition altered during away mode in response to detected presence. Claim 1 recites that the proximity detection module [is] configured to... alter an operating condition of the thermostat during the away mode in response to the detected presence of the user. In this regard, the 518 patent discusses that during a proximity detection ON state, the system can automatically control[] a network device based on detecting a location the mobile device may be from the residential site. NEST at 19:9-13. B. Summary of the Original Prosecution on the 518 Patent The 518 patent was allowed because Applicant persuaded the Examiner that Pouchak did not disclose (a) determining or detecting a physical presence of a user at a site, and (b) a system in which a detected presence of a user at a site (or lack thereof) is a separate and distinct limitation from an enabled away mode of the proximity detection module. NEST at Pouchak instead let a user specify a schedule of times during which Occupied and Unoccupied modes would be active (as shown in FIG. 9H). A step-by-step history of 11

16 the prosecution of the 518 patent follows. Application Filing. Application 13/662,663 (which issued as the 518 patent) was filed October 29, 2012, with 24 claims (claims 1, 12, and 24 were independent). NEST at 1-7 & The application claimed priority to at least 10 pending applications, which all claimed priority to a 2009 provisional. Non-Final Office Action. An April 12, 2013, office action followed Applicant s agreement to restrict the case to claims NEST at 25. The action objected to the drawings for failing to show five claimed features, including: (1) home mode and away mode, (2) the thermostat includes a generally round housing, and (3) the housing includes a control mechanism configured to rotate clockwise and counterclockwise. The action also rejected all claims as anticipated by Pouchak (U.S. Pub. No. 2005/ ), the cited portions of which discuss a thermostat UI with which [o]ne may program schedules of occupied and unoccupied times for various days (shown in Pouchak s FIG. 9H). NEST at 143; NEST at 30. Response to Non-Final Office Action. In a July 12, 2013, response (NEST at 36-51), Applicant discussed the drawing objections as follows: (1) home mode and away mode Applicant directed the Examiner to an on/off setting for proximity detection, in FIGS. 7 (738) and 10 (1036): With respect to the features of home mode and away mode, 12

17 the Applicant respectfully points to both Figures 7 and 10 which each illustrate a proximity detection selector 728, 1036 of the thermostat having an ON and OFF mode. (2) the thermostat includes a generally round housing Applicant could not identify a round housing in the specification, and merely asserted that it was not an essential feature that the application would have to show: In accordance with 37 C.F.R. 1.83(a), the Applicant respectfully submits that the illustration of the more specific feature of a generally round housing is not essential for a proper understanding of the invention, and can merely be represented by the rectangular box of the housing 1130 currently illustrated in Figure 11. Applicant ignored its need to disclose the feature. The specification does not mention a round housing, and FIGS. 10 & 11 show rectangular housings: 13

18 518 Patent at FIGS. 10 and 11 (3) the housing includes a control mechanism configured to rotate clockwise and counterclockwise Applicant had no explicit support for clockwise and counterclockwise (the patent does not include the terms) and instead simply amended Figure 11 to add a box labeled Mechanism 1113 (see above). The best the specification discloses is that a housing can rock or shift left and right as a user contacts mechanisms 1110 or 1112 and Various other orientations to rotate housing (e.g. up/down, left/right, etc.) can be realized as needed or desired. NEST at 50: For the 102 rejections, Applicant narrowed the claims by adding language that states that the thermostat [is] configured to enable the away mode, and shifted the phrase detect a location of the mobile device to detect a presence of a user. In the Remarks, Applicant argued that Although... Pouchak in its most favorable interpretation discloses an away mode of a thermostat (albeit not an away mode of a proximity detection module), the Applicant respectfully submits that the 14

19 entirety of Pouchak still fails to make a single mention of determining or detecting a physical presence of a user at a site. Thus, the Applicant respectfully submits that Pouchack simply fails to disclose proximity detection module configured to detect a presence of a user at the site as the Office Action suggests. NEST at 50 (emphasis in original). Applicant further argued that independent claim 12 as amended now clarifies that a detected presence of a user at a site (or lack thereof) is a separate and distinct limitation from an enabled away mode of the proximity detection module. NEST at 50. Notice of Allowance. An August 2, 2013, notice of allowance cancelled the withdrawn claims and allowed claims 12-23, stating the reason for allowance that applicant s arguments filed on 7/12/2013 regarding claims were persuasive. NEST at Thus, Applicant s characterization of Pouchack s disclosure apparently persuaded the Examiner. VI. THERE IS A REASONABLE LIKELIHOOD THAT AT LEAST ONE CLAIM OF THE 518 PATENT IS UNPATENTABLE The prosecution shows that the claims were allowed on Applicant s argument that Pouchak does not detect presence/absence. But Rosenblatt, which the Examiner did not apply, discloses detecting presence/absence in the same manner and for the same purposes of the claims of the 518 patent via mobile phone location as a proxy for user location and to change a temperature set point. 15

20 Rosenblatt discloses an advanced thermostat that lets a user select locationbased settings in which the thermostat switches between different temperature set points depending on the presence of a user within a designated proximity of the home. NEST at FIG. 70, 71B, 71C, 99, Ehlers also discloses a system with a thermostat having home and away modes, proximity detection, etc. NEST at 31:24-42, 40:1-11, 44:18-59, FIGS. 4A-4H. Rosenblatt and Ehlers both teach that all of the relevant functionality can be incorporated in a single thermostat housing. NEST at 314; NEST at 11: Therefore, independent claim 1 is anticipated (Ground 1) or at least obvious (Ground 4). The dependent claims are also either anticipated or obvious for reasons discussed below. The rest of this Petition further explains how the references render all challenged claims unpatentable, thus raising a reasonable likelihood of prevailing. VII. GROUNDS 1-3: ROSENBLATT A. [GROUND 1] Anticipation of claims 1 and 8 by Rosenblatt 16

21 The 518 patent s only independent claim is anticipated by Rosenblatt, which discloses a system that has all limitations of claim 1 and dependent claim 8. Claim 1, Limitation 1A: A system comprising: a thermostat disposed at a site and including a communication module capable of communicating with a mobile device associated with the site. Rosenblatt discloses a system that includes a thermostat disposed at a site, which Rosenblatt s FIG. 70 illustrates as the networkable thermostat 986. NEST at 20-21; NEST at FIG. 70 & Rosenblatt s networkable thermostat works in conjunction with a mobile device ( handheld device 40 ). The thermostat includes communication modules capable of communicating with a mobile device associated with the site. NEST at For example, Rosenblatt describes such communication modules as follows: The thermostat 986 may or may not include the NFC interface 34. If the NFC 34 is present, a user may tap the handheld device 40 to the NFC interface 34 of the thermostat 986 to create an NFC communication channel 96. Various control information may be transferred across the NFC communication channel 96 according to the tech- 17

22 niques described above. If the NFC interface 34 is not present, the thermostat 986 may include an RFID tag 118 or a matrix barcode tag 124, either of which may be used by the handheld device 40 to initiate control using the techniques described above. NEST at 315 (emphasis added). Rosenblatt also discloses multiple other ways for a mobile device to communicate with the networkable thermostat. See e.g., 92 (explaining that the device can be an iphone configured to control networkable thermostats); 99, , (describing communication interfaces such as Bluetooth, cellular, WiFi, etc.). Therefore, Rosenblatt discloses a thermostat disposed at a site that includes a communication module capable of communicating with a mobile device associated with the site. NEST at Limitation 1B: said thermostat including a proximity detection module disposed thereon, said proximity detection module having a home mode and an away mode. The Rosenblatt thermostat includes a proximity detection module disposed thereon. NEST at As explained above, Patent Owner s proposed construction of proximity detection module is: software or firmware operating on a server, controller, or mobile device that determines the presence of a user or device, or the proximity of a user or device, based on data received (emphasis added). See NEST at

23 The Rosenblatt thermostat includes a proximity detection module: the thermostat 986 may represent an embodiment of the electronic device 10 (NEST at 314) and the electronic device 10 may include location sensing circuitry 22 (NEST at 99). Rosenblatt further describes the use of the location sensing circuitry as a proximity detection module as follows: The location sensing circuitry 22 may represent global positioning system (GPS) circuitry, but may also represent one or more algorithms and databases, stored in the nonvolatile storage 16 or main memory 14 and executed by the CPU 12, which may be used to infer location based on various observed factors. For example, the location sensing circuitry 22 may represent an algorithm and database used to approximate geographic location based on the detection of local x (Wi-Fi) networks or nearby cellular phone towers. As discussed below, the electronic device 10 may employ the location sensing circuitry 22 as a factor for carrying out certain device control techniques. NEST at 99 (emphasis added). Use of the proximity detection module is illustrated in FIGS. 71B and 71C of Rosenblatt. NEST518-19

24 1010 at FIGS. 71B and 71C. Rosenblatt s proximity detection module has home and away modes under either construction of home and away modes. NEST at According to the construction consistent with the applicants arguments during prosecution that home/away corresponded to proximity detection off/on, those modes in Rosenblatt are selected via FIG. 71B s check box NEST at ; NEST at 25. The proximity detection module is in away mode when the location-based setting is on and is in home mode when the location-based setting is off. NEST at 25. While Rosenblatt does not use the terms home mode and away mode, its disclosure of turning proximity detection on/off is exactly what Patent Owner identified in prosecution as representing the 518 patent s away mode and the home mode. See supra, Section V.B. To overcome objections, Patent Owner (then applicant) argued: With respect to the features of home mode and away mode, the Applicant respectfully points to both Figures 7 and 10 which each illustrate a proximity detection selector 728, 1036 of the thermostat having an ON and OFF mode. NEST at 47. Patent Owner rephrased that position as: one of ordinary skill in the art would readily appreciate that a home mode and an away mode can be illustrated by ON and OFF modes. NEST at 48. This analysis applies equally to the on/off modes of Rosenblatt s location- 20

25 based setting that applies proximity detection. NEST at 25. Rosenblatt also discloses home and away modes under Allure s litigation constructions. See supra, Section IV.C.3. Depending on the distance setting in Rosenblatt s location-based settings (Fig. 71C above) the thermostat would change temperatures to operate as if the user were home when the user/mobile device is closer or approaching (1008) and operate as if the user is away when the user/mobile device is not within that range or moving away (1010). NEST at 318; NEST at 26. Thus, under either construction, Rosenblatt discloses a thermostat including a proximity detection module disposed thereon and with home/away modes. NEST at Limitation 1C: said thermostat configured to enable the away mode. Rosenblatt discloses the thermostat configured to enable the away mode via selection of FIG. 71B s check box 1000, as follows: Each of the list items 998 may include a corresponding check box 1000, which may enable a user to determine the basis for controlling the thermostat 986. By way of example, as illustrat- 21

26 ed in FIG. 71B, a user may control the thermostat 986 based on the user's location, based on time, based on weather, as available to the handheld device 40 via a weather application or via the internet, or based on a combination of the above. NEST at (emphasis added); see NEST at 29. Rosenblatt also discloses the thermostat enabling the away mode under Allure s litigation construction for away mode. See supra, Section IV.C.3. Depending on the distance setting in Rosenblatt s location-based settings (Fig. 71C above) the thermostat would change temperatures to operate as if the user is away when the user/mobile device is not within that range or moving away (1010). NEST at 318, NEST at 26. Accordingly, under either construction of away mode, Rosenblatt discloses the thermostat configured to enable the away mode. NEST at Limitation 1D: said proximity detection module configured to: detect a presence of a user at the site. Rosenblatt discloses the proximity detection module configured to detect a presence of a user at the site. NEST at As explained above, Patent Owner s proposed construction of detect a presence of a user at the site is: determine or calculate, based on data received, that a person or device is at the site, is approaching the site, or is within a predefined distance of the site. NEST at

27 Rosenblatt discloses location sensing circuitry 22 that detects the location of the handheld device 40, and thus presence of the user at the site, as follows: In certain embodiments, the electronic device 10 may include location sensing circuitry 22. The location sensing circuitry 22 may represent global positioning system (GPS) circuitry, but may also represent one or more algorithms and databases, stored in the nonvolatile storage 16 or main memory 14 and executed by the CPU 12, which may be used to infer location based on various observed factors. For example, the location sensing circuitry 22 may represent an algorithm and database used to approximate geographic location based on the detection of local x (Wi-Fi) networks or nearby cellular phone towers. As discussed below, the electronic device 10 may employ the location sensing circuitry 22 as a factor for carrying out certain device control techniques. By way of example, the location sensing circuitry 22 may be used by the electronic device 10 to determine a user's location during an event NEST at 99 (emphasis added); see id. 318; NEST at 29. Rosenblatt s detecting device location to infer user location meets the limitation of being configured to detect presence of a user at the site. NEST at

28 Limitation 1E: alter an operating condition of the thermostat during the away mode in response to the detected presence of the user. Rosenblatt discloses the proximity detection module being configured to alter an operating condition of the thermostat during the away mode in response to the detected presence of the user. NEST at 33. Rosenblatt explains that while the location-based setting is on (while in away mode), detecting a presence of a user at or near the location causes the thermostat to alter an operating condition by selecting a different temperature setting: A distance setting 1006 may allow a user to set a number of miles away from home that a user may be located for a corresponding temperature setting On the other hand, a temperature setting 1010 may be applied outside of the distance setting For example, when the handheld device 40 is located within a certain distance of the location of the thermostat 986, as determined by the location sensing circuitry 22, the thermostat 986 may select the temperature settings 1008; otherwise, the thermostat 986 may select the temperature settings NEST at 318 (emphasis added). As shown in Fig. 71C, a user may adjust the distance setting 1006, including to a dis- 24

29 tance that corresponds to the site. Id. Therefore, Rosenblatt discloses the locationbased proximity detection module being configured to alter the set point operating condition of the thermostat during the away mode in response to detecting the presence of the user. NEST at 33. U.S. Pat. 8,571, A system, comprising: [1A] a thermostat disposed at a site and including a communication module capable of communicating with a mobile device associated with the site; [1B] said thermostat including a proximity detection module disposed thereon, said proximity detection module having a home mode and an away mode; 102 Rosenblatt Rosenblatt discloses a system including a thermostat disposed at a site, which is illustrated in FIG. 70 of Rosenblatt. NEST at FIG. 70; NEST at 314. Rosenblatt also discloses the thermostat including a communication module (e.g., NFC interface 34) capable of communicating with a mobile device associated with the site. NEST at 315; see also 92 (explaining that the device can be an iphone configured to control networkable thermostats); , (describing communication interfaces such as cellular, WiFi, Bluetooth, etc.). Rosenblatt discloses the thermostat including a proximity detection module, stating that the thermostat may represent an embodiment of the electronic device 10 (NEST at 314 and the electronic device 10 may include location sensing circuitry 22 (NEST at 99). Use of the proximity detection module is illustrated in FIGS. 70, 71B and 71C of Rosenblatt. NEST at FIG. 70, 71B and 71C. 25

30 [1C] said thermostat configured to enable the away mode; Rosenblatt also discloses the proximity detection module having home and away modes (off and on), which are selected via the check box 1000 shown in FIG. 71B. NEST at 317. This is consistent with statements made during prosecution that one of ordinary skill in the art would readily appreciate that a home mode and an away mode can be illustrated by ON and OFF modes. NEST at 48. Rosenblatt also discloses the home and away modes under Allure s litigation construction because the thermostat would change temperatures to operate as if the user where home when the user or device is closer or approaching the site and operate as if the user where away when the user or device is outside the range or moving away. Fig. 71C (elements 1004, 1006, 1008, 1010 above). Rosenblatt discloses the thermostat configured to enable the away mode via selection of the check box 1000 shown in FIG. 71B. Rosenblatt would also disclose the thermostat enabling the away mode under Allure s litigation construction because the thermostat would switch from home temperatures (1008) to away temperatures (1010) 26

31 [1D] said proximity detection module configured to: detect a presence of a user at the site; and when the user or device is outside the range or moving away as shown in Fig. 71C (elements 1004, 1006, 1008, 1010 above). NEST at Rosenblatt discloses the proximity detection module being configured to detect a presence of a user at the site, as it discloses including location sensing circuitry 22 that detects the location of the handheld device 40, and consequently, detects presence of the user at the site. NEST at 99, 318. Rosenblatt explains detecting presence as follows: In certain embodiments, the electronic device 10 may include location sensing circuitry 22. The location sensing circuitry 22 may represent global positioning system (GPS) circuitry, but may also represent one or more algorithms and databases, stored in the nonvolatile storage 16 or main memory 14 and executed by the CPU 12, which may be used to infer location based on various observed factors. For example, the location sensing circuitry 22 may represent an algorithm and database used to approximate geographic location based on the detection of local x (Wi-Fi) networks or nearby cellular phone towers. As discussed below, the electronic device 10 may employ the location sensing circuitry 22 as a factor for carrying out certain device control techniques. By way of example, the location sensing circuitry 22 may be used by the electronic device 10 to determine a user's location during an event. NEST at 99 (emphasis added). 27

32 [1E] alter an operating condition of the thermostat during the away mode in response to the detected presence of the user. Rosenblatt discloses the proximity detection module being configured to alter an operating condition of the thermostat during the away mode in response to the detected presence of the user. NEST at 318. Rosenblatt explains that while the location-based setting is on (while in away mode), detecting a presence of a user at or near the location causes the thermostat to alter an operating condition by selecting a different temperature setting, stating: when the handheld device 40 is located within a certain distance of the location of the thermostat 986, as determined by the location sensing circuitry 22, the thermostat 986 may select the temperature settings 1008; otherwise, the thermostat 986 may select the temperature settings NEST at 318. As shown in Fig. 71C, a user may adjust the distance setting 1006, such that it could be set to a distance that corresponds to the site. Id. Claim 8: The system of claim 1, wherein the thermostat is further configured to: detect a selection of a home setting or an away setting on a user interface of the mobile device; enable the home mode of the proximity detection module in response to the home setting; and enable the away mode of the proximity detection module in response to the away setting. 28

33 Rosenblatt discloses the thermostat configured to detect a selection of a home setting or an away setting on a user interface of the mobile device, enable the home mode of the proximity detection module in response to the home setting, and enable the away mode of the proximity detection module in response to the away setting. NEST at 34. As explained above for claim 1, Rosenblatt s description of turning the location-based setting off and on corresponds to switching between the home and away modes. See supra Section VII.A, Limitations 1B and 1C; NEST at 35. Rosenblatt discloses that the thermostat 986 may represent an embodiment of the electronic device 10 (NEST at 314) and the electronic device 10 may include location sensing circuitry 22 (NEST at 99). The thermostat is configured to detect selection of home and away settings by detecting check box 1000 for the Location-Based Setting on a mobile device as illustrated in FIG. 71B. NEST , FIG. 71B. 29

34 Thus, Rosenblatt discloses the thermostat being configured to enable the home mode of the proximity detection module in response to the home setting (by unchecking check box 1000) and to enable the away mode of the proximity detection module in response to the away setting (by checking check box 1000). NEST at 34. B. [GROUND 2] Obviousness of claims 2 and 3 under 103 over Rosenblatt in view of Chapman Claim 2: The system of claim 1, wherein the thermostat includes a generally round housing. Rosenblatt in view of Chapman renders obvious the thermostat including a generally round housing. NEST at 35. Rosenblatt illustrates the example networkable thermostat 986 with a housing that is substantially rectangular with rounded corners. See NEST at FIG. 70; NEST at 35. Therefore, Rosenblatt discloses this feature if round is construed to include rectangular. See supra Section IV.C. Further, thermostats with generally round housings were traditionally known. For example, Chapman notes that such a thermostat s outer periphery 24 can have a variety of different shapes. For example the outer periphery 24 may be round, square, rectangular, etc. NEST at 24 (emphasis added). As noted by Mr. Williamson: [o]ne skilled in the art would have seen a reason to 30

35 modify Rosenblatt s thermostat housing to be round, as described by the Chapman reference, because some markets were preconditioned to the concept of thermostats being round, and because a thermostat with a round housing can be more aesthetically pleasing when mounted to a wall because a slight deviation from a straight up and down mounting is not as noticeable. NEST at 35; KSR, 550 U.S. 398, 417 (2007). Accordingly, modifying the Rosenblatt thermostat to have a generally round housing would have been obvious in light of Chapman. Claim 3: The system of claim 2, wherein the housing includes a control mechanism configured to rotate clockwise and counterclockwise to allow for the selection of the home mode and the away mode. Rosenblatt in view of Chapman renders obvious claim 3, which recites the housing including a control mechanism configured to rotate clockwise and counterclockwise to allow for the selection of user inputs, including the home mode and the away mode. NEST at Rosenblatt discloses that [b]uttons 990 may enable manual control over the thermostat 986 (NEST at 314) and that actual embodiments can have features in addition to those specifically disclosed. NEST at 345. Control mechanisms that rotate clockwise and counterclockwise to make selections were also common. NEST at For example, Chapman discloses a user input device 20 [that] is a rotatable knob.... To change the ther- 31

36 mostat settings, the user simply rotates the knob in one direction through the small arc and the thermostat 10 scrolls through the available settings on the display 18. NEST at 25. Chapman also discloses that the dial is turned until the desired... selection is highlighted on the display 18 and, once highlighted, the rotary dial is depressed or otherwise manipulated to choose the currently highlighted option. NEST at 37. In Chapman, [t]he user interface display 18 displays characters, text, symbols, icons images, graphics and the like, collectively referred to as information 28, for the user.... the information 28 may provide the user with the operating mode, temperature set point, current temperature, and/or an indication of the fan, etc. NEST at 26 (emphasis added). A skilled artisan would have been prompted to substitute a rotatable knob (as in Chapman) for the buttons 990 in Rosenblatt s thermostat 986, because Chapman discloses that this type of knob and touchscreen devices were alternatives for accessing the same type of user interface, and because such knobs were commonly employed to navigate user interfaces at the time. NEST at 37. Moreover, such a knob was known to be user friendly and enabled quick adjustment of settings and values. NEST at 37. Such modifications are the work of 32

37 the skillful mechanic, not that of the inventor. Sakraida, v. Ag Pro, Inc., 425 U.S. 273, 282 (1976). [I]f a technique has been used to improve one device, and a person of ordinary skill in the art would recognize that it would improve similar devices in the same way, using the technique is obvious unless its actual application is beyond his or her skill. KSR, 550 U.S. at 417. Rosenblatt in view of Chapman therefore renders obvious the housing with a control mechanism configured to rotate clockwise/counterclockwise to allow for the selection of the home/away mode. C. [GROUND 3] Obviousness of claims 9 and 12 under 103 over Rosenblatt in view of Nicodem Claim 9: The system of claim 1, further comprising: a second thermostat disposed at a site and including a communication module capable of communicating with the mobile device, said thermostat configured to: alter an operating condition of the second thermostat in response to detecting the change in the location e [sic] of the mobile device. Rosenblatt and Nicodem render obvious claim 9, adding the system including a second thermostat disposed at a site and including a communication module capable of communicating with the mobile device, with the thermostat being configured to alter an operating condition of the second thermostat in response to detecting the change in the location of the mobile device. NEST at

38 In particular, Rosenblatt discloses the mobile device communicating with multiple thermostats, stating the electronic device 10 may be an iphone configured as a controlling device to control one or more networkable thermostats. NEST at 92. Rosenblatt also discloses the thermostats including communication modules capable of communicating with the mobile device. NEST at 315 (describing NFC communication interface 34), 92 (explaining that the device can be an iphone configured to control networkable thermostats), , (describing communication interfaces). Moreover, Nicodem discusses a system in which a first thermostat can control the set point of a second thermostat if the second thermostat loses its network connection to a remote transmitter. NEST at 30. Nicodem states: thermostat 106, by using the wireless component 112, and second thermostat 206, by using the second wireless component 212, may optionally be operably coupled to each other via the localized wireless network 104. As one of ordinary skill in the art will appreciate, this feature may allow data sharing and more complex logic.... [T]he 34

39 sharing of data may allow one thermostat to update another thermostat with more current data, such as set points, if, for example, the other thermostat was unable to receive programming data at the time the control transmitter 102 sent it. NEST at 30 (emphasis added). A skilled artisan would have been prompted to supplement the system of Rosenblatt so that one of its thermostats (after having determined a set point based on a location of the mobile device) would alter the set point of a second thermostat as disclosed by Nicodem, because the first thermostat would already be modifying its own set point in response to the change in location of the mobile device and because changing the set point of the second thermostat would enable the second thermostat to keep its set point up-to-date with changes in location of the mobile device, should the second thermostat lose a communication channel to the mobile device. NEST at 39 (explaining that using one thermostat to control and update a second was particularly beneficial in larger, multi-thermostat installations ); NEST at 30 (disclosing 35

40 advantages of coupling and configuring thermostats to alter operating conditions of one another). Therefore, Rosenblatt in view Nicodem teaches the system including a second thermostat disposed at a site and including a communication module capable of communicating with the mobile device, with the thermostat being configured to alter an operating condition of the second thermostat (indeed, any thermostat) in response to detecting the change in the location of the mobile device. NEST at Claim 12: The system of claim 1, wherein the thermostat is further configured to: detect an availability of a WIFI network including a device connected to the WIFI network; access the device using the WIFI network to detect an operating condition of the device; and initiate an altering of the operating condition of the network device using the WIFI network. Rosenblatt in view of Nicodem renders obvious claim 12, which adds the thermostat detecting an availability of a Wi-Fi network including a device connected to the Wi-Fi network, accessing the device using the Wi-Fi network to detect an operating condition of the device, and initiating an altering of the operating condition of the network device using the Wi-Fi network. NEST at In particular, Rosenblatt discloses the use of Wi-Fi networks, including using controlling devices 92 to communicate with controlled devices 94 over Wi-Fi net- 36

41 works. NEST at 138, FIG. 7. Rosenblatt also discloses controlling a thermostat for a home heating or cooling system and that the thermostat may initiate cooling and heating operations (NEST at 314) by detecting the operating condition of an heating, ventilating and air conditioning ( HVAC ) system and sending signals to alter the operating conditions of the HVAC system according to the thermostat settings. NEST at Thus, although Rosenblatt did not find need to mention precisely how the thermostat should communicate with the heating and cooling systems, a skilled artisan would understand that Rosenblatt s thermostat acting as a control device 92 would readily use the WiFi network to communicate with and control a WiFi enabled HVAC system as a controllable device over a Wi-Fi network. NEST To the extent that this claim is not obvious over Rosenblatt alone, Nicodem discloses a wireless temperature control system that includes a thermostat 106 that can communicate with an HVAC (heating, ventilation, and air conditioning) unit 110 via wires or wirelessly: the thermostat 106 may actually communicate with the HVAC unit 110 via wireless means, thereby eliminating the need for the depicted wires 108. NEST at Nicodem also discloses that the wireless network can be any suitable wireless network, including a Wi-Fi network (NEST at 23), which aligns with Rosenblatt s disclosure that also teaches controlling devices over Wi-Fi networks (NEST at 138; see al- 37

42 so Fig. 7, 134 (showing controlling device 92 and controllable device 94 connected via various network types including transfer of control information indicating how the controllable device 94 may be controlled )). Accordingly, it would have been obvious to implement Nicodem s teaching of using a wireless Wi-Fi network for the thermostat to control the HVAC system for the stated benefit of eliminating the need for wires between the thermostat and the HVAC system. NEST at 41; NEST at 25. In such a system, the thermostat would be configured to detect Wi-Fi network availability, including the HVAC device connected to the Wi-Fi network. NEST at 42; NEST at 23 and 25. The thermostat would be configured to access the HVAC device using the Wi-Fi network to detect an operating condition of the HVAC device so as to be able to report whether the HVAC system is running via the disclosed run indicators. NEST at 42; NEST at 26. The thermostat can control single and dual stage HVAC units and would be configured to initiate an altering of the operating condition of the networked HVAC device using the Wi-Fi network in order to control the operation of the HVAC device. NEST at 42; NEST at 26, 27 ( The user could, however, use the thermostat 106 to program different set points, time periods, and other data to control the functionality of the HVAC unit 110. ). 38

43 It therefore would have been obvious to modify the thermostat of Rosenblatt to control an HVAC device via a Wi-Fi wireless connection as taught by Nicodem such that the thermostat is configured to detect an availability of a Wi-Fi network including the HVAC device connected to the Wi-Fi network, access the HVAC device using the Wi-Fi network to detect an operating condition of the HVAC device, and initiate altering of the operating condition of the HVAC device using the Wi-Fi network. NEST at VIII. GROUNDS 4-6: ROSENBLATT IN VIEW OF EHLERS As explained above in Section VII, independent claim 1 is anticipated by Rosenblatt, dependent claim 8 is also anticipated by Rosenblatt, and dependent claims 2, 3, 9 and 12 are rendered obvious over Rosenblatt in view of one of Chapman or Nicodem. See supra Section VII. The anticipation of claim 1 is premised on the understanding that Rosenblatt directly discloses that Rosenblatt s thermostat 986 includes the location sensing circuitry 22. Grounds 4-6 are premised on the understanding that it is at least obvious in view of the teachings of Rosenblatt and Ehlers to include location sensing circuitry 22 on thermostat 986. A. [GROUND 4] Obviousness of claims 1 and 4-8 under 103 over Rosenblatt in view of Ehlers Claim 1, Limitation 1A: A system comprising: a thermostat disposed at a site and including a communication module capable of communicating with a mobile device associated with the site. 39

44 As explained above with respect to Limitation 1A of Ground 1, Rosenblatt discloses a system that includes a thermostat disposed at a site, which is illustrated as networkable thermostat 986, and discloses that the thermostat 986 includes a communication module capable of communicating with a mobile device (handheld device 40) associated with the site. See supra Section VII.A, Claim 1, Limitation 1A; NEST at FIG. 70, 22, 48, 92, , , 314. Therefore, Rosenblatt discloses a thermostat disposed at a site that includes a communication module capable of communicating with a mobile device associated with the site. NEST at 20-23, 43. Limitation 1B: said thermostat including a proximity detection module disposed thereon, said proximity detection module having a home mode and an away mode. Rosenblatt in view of Ehlers discloses the thermostat including a proximity detection module disposed thereon. NEST at As explained above, with respect to Limitation 1B of Ground 1, Rosenblatt discloses the thermostat including a proximity detection module having a home mode and an away mode under either construction of home mode and away mode. See supra Section VII.A Claim 1, Limitation 1B; NEST at 24-28, 49; NEST at 92, 99, 314, 317, FIGS. 70, 71B and 71C. Indeed, Rosenblatt discloses that the thermostat 986 may represent an em- 40

45 bodiment of the electronic device 10 (NEST at 314) and that the electronic device 10 may include location sensing circuitry 22 (NEST at 99). This unambiguously teaches that the thermostat 986 includes the location sensing circuitry 22 and the associated functionality disclosed in Rosenblatt. However, even if Rosenblatt did not disclose the thermostat 986 including the location sensing circuitry 22, the language at 99 and 314 of Rosenblatt at least suggests such a modification. NEST at 44. Like Rosenblatt, Ehlers also discloses a system with a thermostat having advanced functionality, including home and away modes, proximity detection, etc. NEST at 31:24-42 (home mode and away mode), 40:1-11 (occupancy sensors on the thermostat that alter operating conditions differently depending on the presence of absences of the occupant ), 44:28-59 (user selection of occupancy modes), FIGS. 4A-4H. Also like Rosenblatt, Ehlers discloses that all of the functionality can be incorporated into the thermostat, stating: Some or all of these functions and features may be accessible through the thermostat 1.30D and/or through the internet 1.28 (via a web browser). NEST at 11: Thus, to the extent Patent Owner contends that Rosenblatt does not itself disclose operating states that depend on the presence or absence of the user, Ehlers discloses this with its occupancy sensors. Moreover, a skilled artisan would be motivated to include both the detection of the location of a user based on the user s mobile 41

46 device, as in Rosenblatt, with the occupancy sensors of Ehlers so that the user could access occupancy detection and the thermostat could respond to occupancy detection even if the user s phone were lost or left at work, or the site included occupants who did not have phones linked to the system. NEST at 45. This represents nothing more than the combination of two well-known ideas in a predictable manner to achieve an expected result. Accordingly, Rosenblatt in view of Ehlers renders obvious the thermostat including a proximity detection module disposed thereon and including home and away modes. NEST at Further, even under Patent Owner s litigation-based construction of home and away mode (see supra, Section IV.C.3), the combination of Ehlers with Rosenblatt discloses a home and away mode. Ehlers discusses that [t]he thermostat scheduling panel 4.36 permits a customer to select the occupancy mode which will be used for various time periods during the day. NEST at 45:8-20. Home and away modes can be enabled by selecting home and away settings as shown in FIG. 4H. NEST518-42

47 1001 at 45; see also NEST FIGS. 4D-4F (showing that a user can check and uncheck whether profiles are Active in home and away modes). Limitation 1C: said thermostat configured to enable the away mode. As explained above with respect to Limitation 1C of Ground 1, Rosenblatt discloses the thermostat being configured to enable the away mode via selection of FIG. 71B s check box 1000 and under Patent Owner s litigation construction, via changing temperatures to operate as if away when the user/mobile device is not within range or moving away shown in FIG. 71C. See supra Section VII.A, Claim 1, Limitation 1C; NEST at , FIGS. 71B and 71C; NEST at 26, 29. Accordingly, Rosenblatt in view of Ehlers teaches the thermostat being configured to enable the away mode by turning on the away mode location-based setting. NEST at 46. Limitation 1D: said proximity detection module configured to: detect a presence of a user at the site. As explained above with respect to Limitation 1D of Ground 1, Rosenblatt s disclosure of detecting location of the device to infer the user s location meets the 43

48 claim limitation of being configured to detect presence of a user at the site. See supra Section VII.A, Claim 1, Limitation 1D; NEST at 99, 318; NEST at Therefore, Rosenblatt in view of Ehlers teaches the proximity detection module being configured to detect a presence of a user at the site. NEST at 47. Limitation 1E: alter an operating condition of the thermostat during the away mode in response to the detected presence of the user. As explained above with respect to Limitation 1E of Ground 1, Rosenblatt discloses the proximity detection module configured to alter an operating condition of the thermostat during the away mode in response to the detected presence of the user. See supra Section VII.A, Claim 1, Limitation 1E; NEST at 33; NEST at 318. Therefore, Rosenblatt in view of Ehlers teaches the location-based proximity detection module being configured to alter the set point operating condition of the thermostat during the away mode in response to detecting the presence of the user. NEST at

49 U.S. Pat. 8,571, A system, comprising: [1A] a thermostat disposed at a site and including a communication module capable of communicating with a mobile device associated with the site; [1B] said thermostat including a proximity detection module disposed thereon, said proximity detection module having a home mode and an away mode; [1C] said thermostat configured to enable the away mode; [1D] said proximity detection module configured to: detect a presence of a user at the site; and [1E] alter an operating condition of the 103 Rosenblatt in view of Ehlers Rosenblatt discloses a system that includes a thermostat disposed at a site, which is illustrated as networkable thermostat 986 in FIG. 70 of Rosenblatt. NEST at FIG. 70; NEST at 314. Rosenblatt also discloses the thermostat including a communication module (e.g., NFC interface 34) capable of communicating with a mobile device associated with the site. NEST at 315; see also 92 (explaining that the device can be an iphone configured to control networkable thermostats); , (describing communication interfaces such as cellular, WiFi, Bluetooth, etc.). Rosenblatt in view of Ehlers discloses the thermostat including a proximity detection module. Rosenblatt in view of Ehlers discloses a proximity detection module having a home mode and an away mode under either construction of home and away mode. NEST at 92, 99, 317, FIGS. 71B and 71C (elements 1006, 1008, 1010 above); NEST at 45:8-20; NEST at 27; see also NEST FIGS. 4D-4F. Rosenblatt and Ehlers both teach incorporating such functionality into a thermostat. NEST at 314; NEST at 31:24-42, 40:1-11, 44:28-59, FIGS. 4A- 4H. Rosenblatt in view of Ehlers discloses the thermostat configured to enable the away mode via selection of the FIG. 71B check box 1000, Rosenblatt also discloses the thermostat enabling the away mode under Allure s litigation construction because the thermostat would switch from home temperatures (1008) to away temperatures (1010) when the user or device is outside the range or moving away as shown in Fig. 71C. NEST at Rosenblatt in view of Ehlers discloses the proximity detection module being configured to detect a presence of a user at the site, as Rosenblatt discloses location sensing circuitry 22 that detects the location of the handheld device 40, and consequently, detects presence of the user at the site. NEST at 99, 318. Rosenblatt in view of Ehlers discloses the proximity detection module being configured to alter an operating condition 45

50 thermostat during of the thermostat during the away mode in response to the the away mode in detected presence of the user. NEST at 318. response to the detected presence of on (while in away mode), detecting a presence of a user at or Rosenblatt explains that while the location-based setting is the user. near the location causes the thermostat to alter an operating condition by selecting a different temperature setting, stating: when the handheld device 40 is located within a certain distance of the location of the thermostat 986, as determined by the location sensing circuitry 22, the thermostat 986 may select the temperature settings 1008; otherwise, the thermostat 986 may select the temperature settings NEST at 318. As shown in Rosenblatt Fig. 71C, a user may adjust the distance setting 1006, such that it could be set to a distance small enough to reflect that the user is present at the site. Id. Claim 4: The system of claim 1, wherein the thermostat includes an LCD display configured to indicate use of the home mode, the away mode and display a current set-point. Rosenblatt in view of Ehlers discloses a thermostat having an LCD display configured to indicate use of home and away modes and display a current set point. NEST at Rosenblatt illustrates the networkable thermostat 986 as including a display that appears to be an LCD display and that one skilled in the art would understand to be an LCD display. NEST FIG. 70; NEST at 49. Rosenblatt confirms that the displays on the electronic device may be any suitable display, such as liquid crystal display (LCD). NEST at 96. Such LCD displays were traditionally known in the art, are also illustrated in the Figures of Ehlers, and are also disclosed in the priority provisional application (60/368,963) that Ehlers incorporates by reference. NEST at 27, 28,

51 (showing the thermostat depicted in FIG. 3A of Ehlers and describing the thermostat as having an LCD display ). Rosenblatt discloses an indication of the use of the home and away modes in the form of the check box in FIG. 71B indicating whether the location-based setting is on or off. NEST at 33; NEST at 317, 318. Rosenblatt discloses the display of a temperature set point is shown in FIGS. 70, 71C and 71D. NEST at 33; NEST at 314, 318, 319. Rosenblatt in FIG. 70 shows a mode button and display of modes on the control device, but does not expressly disclose the display of home and away modes on the thermostat. Ehlers also discloses the display being configured to indicate use of the home mode, the away mode and display a current set point, such as in FIG. 4C of Ehlers NEST at 43:39-51 (describing the display show- 47

52 ing occupancy mode and set points); FIGS. 3A and 4C (showing an icon of a house with a person inside and outside of the house, respectively), FIG. 4H (showing scheduling of away mode), and 45:8-20. Thus, as set forth above with respect to limitation 1B, Rosenblatt in combination with Ehlers discloses a home mode and an away mode under either construction of those terms. As set forth above with respect to limitation 1C, modifying Rosenblatt to display the home mode, away mode, etc. on the thermostat is nothing more than a combination of known elements to yield predictable results and a skilled artisan would have been motivated to add such feature to the extent it is not already disclosed by Rosenblatt so that a user would be able to view this information on the thermostat without requiring them to have their phone present. Therefore, Rosenblatt in view of Ehlers discloses thermostats with LCD displays that indicate use of home and away modes and display a current set point. NEST at Claim 5: The system of claim 4, wherein the LCD display has an energy savings indicator to provide a visual indication of energy savings related to the away mode. Rosenblatt in view of Ehlers disclosed the LCD display having an energy savings indicator to provide a visual indication of energy savings related to the away mode. NEST at

53 Ehlers discloses multiple examples of the display having an energy savings indicator related to the away mode. NEST at For example, Ehlers FIGs. 3A (shows house icon with a user inside) and 4C (user outside and word away ) and both display a relative cost to the user graphically (e.g., 1-10 or $$) that would provide a user with an indication of savings related to the away mode. See also NEST at 28:44-48, 33, 30:1-4; NEST at 51. Ehlers discloses a thermostat showing a daily electrical report pop up screen 4.76 (NEST at FIG. 4M, 46:45-47, see also FIG. 4K), and one skilled in the art would understand screen 4.76 in FIG. 4M of Ehlers to provide a visual indication of energy savings related to an away mode, for example, by showing a decrease in energy usage during hours when the thermostat is scheduled for the away mode. NEST at 55. FIG. 4H of Ehlers shows when the away mode is and is not scheduled, so a user can correlate energy consumption to any of the scheduled modes, 49

54 including the away mode. NEST at 55. Both Rosenblatt and Ehlers are directed to allowing users to make informed decisions about more efficient energy use through modification of schedules according to whether a user is home or not home. Ehlers further explains that collecting and reporting the various energy consumption and efficiency data can beneficially provide feedback to the user. NEST at 29: This allows a user to determine how energy efficient the management protocol and control parameters are and to determine an effective setpoint based on such data. NEST at 30:5-38, see also 28: Thus, as discussed in the Williamson Declaration, a person skilled in the art would have been motivated to modify Rosenblatt to include the Ehlers reporting functionality to further encourage the use of the energy saving features of Rosenblatt by providing feedback to the user to make informed decisions about energy set points. NEST at 52. This combination is nothing more than adding well-known features described in Ehlers to the similar device described in Rosenblatt s, which is the work of the skillful mechanic, not that of the inventor. Sakraida, 425 U.S. at 273; KSR, 550 U.S. at 417 ( [I]f a technique has been used to improve one device, and a person of ordinary skill in the art would recognize that it would improve similar devices in the same way, using the technique is obvious unless its actual application is beyond his or her skill ). NEST at 52. Accordingly, Rosenblatt in view 50

55 of Ehlers renders obvious claim 5, reciting the LCD display having energy savings indicators to provide a visual indication of energy savings related to the away mode. NEST at Claim 6: The system of claim 4, wherein the LCD display has an energy history section to display how much energy has been used daily by an HVAC system at the site. Rosenblatt in view of Ehlers discloses the LCD display having an energy history section to display how much energy has been used daily by an HVAC system at the site. NEST at 53. As discussed above with respect to claim 5, it would have been obvious to include the energy savings indicators of Ehlers in the thermostat of Rosenblatt. NEST at One of the energy savings indicators that Ehlers teaches for the thermostat to display is a daily electrical report pop up screen 4.76 (see FIG. 4M). NEST at 46:44-59; NEST at 53. Therefore, Rosenblatt in view of Ehlers discloses the LCD display having an energy history section with a daily electrical report to display how much energy 51