• Emerson Electric Co. v. Sipco, LLCAll claims unpatentable
  PTAB · Jan 16, 2018 · CBM2016-00095 · APJ Joni Y Chang · CBM · Final written decision

  Claims 1, 7, 9, 16, and 17 are unpatentable under § 101 and § 103(a) over Tymes; unpatentability under § 112, ¶ 1 was not shown.

  In the decision

  …Pet. 63–85. Petitioner provides detailed explanations as to how Tymes teaches or suggests each limitation and articulates a reason to combine the teachings of Tymes, citing to Mr. Geier’s testimony for support. Id.; Ex. 1003. Patent Owner counters that Tymes does not disclose certain…

  RulingsFinal written decision

  • Claim Construction › Intrinsic evidence (Phillips canons) › Plain and ordinary meaning to a POSITATerm construed board ownDecided for petitioner

    “Upon consideration of the parties’ contentions, we are not persuaded by Patent Owner’s arguments, as they conflate “power” with “transmission range”—the claim term recites “low-power,” not “low-transmission range.” We agree with Petitioner that Patent Owner’s proposed construction would import improperly a limitation into the claims, and we credit Mr. James T. Geier’s testimony (Ex. 1038 ¶¶ 34−39) as it consistent with the other evidence of record before us. We address below each of Patent Owner’s arguments in turn. First, Patent Owner argues that “the claim language itself indicates that the claimed low-power transceiver transmits low-power signals,” citing the language of claim 2, “wherein the low-power signal comprises a logical IP address.” PO Resp. 12 (citing Ex. 1001, 14:60–61). However, “the low-power signal” does not necessarily require a transceiver to transmit signals having a limited transmission range. Patent Owner does not explain meaningfully, or provide persuasive evidence to show, how a “low-power signal” is necessarily related to the transmission range of a transceiver. Consistent with the plain and ordinary meaning of the term, “a low-power transceiver” refers to a transceiver that consumes less power, e.g., by transmitting and receiving low power signals. Ex. 1038 ¶¶ 34−39.” slip op. at 23

  • Patent Eligibility (§101) › Alice/Mayo step one — 'directed to'Step1 directed to exceptionUnpatentable

    “However, Patent Owner’s arguments are not commensurate in scope with the claims. The purported problems that arose with the development of networks hosting wireless device—unlawful interruption of that data, interference, and contention—are addressed by using an extremely low-power transmitter. Ex. 1001, 5:65−6:11. As discussed above, the challenged claims recite a generic “low-power transceiver,” not an extremely low-power transmitter. Additionally, the alleged problem of transforming data to a different protocol is addressed by an unclaimed feature, as the ’842 patent itself recognizes that the invention is not necessarily limited to certain protocol or requires a protocol conversion. Id. at 13:55−14:5. Moreover, the challenged claims do not requires a protocol conversion or recite a device for converting data from one protocol to a different protocol. Rather, they recite generically a “network of addressable devices.” Patent Owner’s argument that the claims are “directed to an improvement in communication technology between remote devices that are accessible by wireless communication and a central location via a circuit interface” is unavailing. Significantly, the claims are not directed to a new type of transceiver, interface circuit, or controller to establish a communication link between a remote device and the central location. Instead, the claims are directed to transmitting data between locations using conventional or generic computer components. The challenged claims essentially recite a device for communicating information that comprises: (1) a low-power transceiver for transmitting or receiving data; (2) an interface circuit for communicating with a central 33 location; and (3) a controller for establishing a communication link. The Specification confirms that these features were known in the art. Ex. 1001, 5:23–25, 6:62–64 (“As is well known by those skilled in the art, a variety of transducers can perform this functionality adequately.”), 10:13–15 (“[T]he controller 256 may be a general purpose microprocessor or microcontroller.”), 10:21–23 (“The interface 258 within the transceiver 270 is designed to interface with this typical/standard telephone circuitry 263.”), 10:23–26 (“The specific implementation of the circuitry of [interface] 258 will be appreciated by persons skilled in the art and need not be described in detail herein.”). Indeed, the FCC Bulletin also confirms that low-power wireless transmitters were “used virtually everywhere,” noting that “[c]ordless phones, baby monitors, garage door openers, wireless home security systems, keyless automobile entry systems and hundreds of other types of common electronic equipment rely on such transmitters to function.” Ex. 2001, 1. Moreover, the ’842 patent itself recognizes that the communication link between the remote device and central location can be established by initiating a phone call over a telephone line that is part of the public-switched telephone network. Ex. 1001, 2:34−38. There is no dispute that such a communication link was known in the art. Id. at 10:21−26.” slip op. at 33

  • Patent Eligibility (§101) › Alice/Mayo step two — inventive conceptStep2 no inventive conceptUnpatentable

    “38 For the foregoing reasons, we are persuaded that Petitioner has demonstrated sufficiently that claims 1, 7, 9, 16, and 17 of the ’842 patent are directed to a patent-ineligible abstract idea. Whether the challenged claims lack a patent-eligible inventive concept Turning to the second step in the analysis, we look for additional elements that can “transform the nature of the claim” into a patent-eligible application of an abstract idea. That is, we determine whether the claims include an “inventive concept,” i.e., an element or combination of elements sufficient to ensure that the patent in practice amounts to significantly more than a patent on the abstract idea itself. Alice, 134 S. Ct. at 2357. The additional elements must be more than “well-understood, routine, conventional activity.” Mayo, 768 S. Ct. at 1297−98. Here, Petitioner argues that claims 1, 7, 9, 16, and 17 are unpatentable because they are “directed only to an abstract idea with nothing more added than generic computing components and ‘well-understood, routine, conventional activity’ previously performed in the field (both individually and as an ordered combination in the claims).” Pet. 23–24 (citing Mayo, 132 S. Ct. at 1294). According to Petitioner, the challenged claims “recite the concept of establishing a communication route between two points ‘as performed by a generic computer,’ without disclosing any ‘novel or unusual’ improvement to ‘the functioning of the computer itself’ or any ‘advance in computer technology that makes the performance of [routine] functions more effective.” Id. at 24 (citing Alice, 134 S. Ct. at 2358–60). 39” slip op. at 38

  • Obviousness (§103) › Motivation to combine / reasonable expectation of successMotivation foundUnpatentable

    “As Petitioner notes (Pet. 66−68; Ex. 1003 ¶¶ 353−366), Tymes discloses “an improved, low-cost, low-power, data communication network in which a number of remote terminal units are able to send packets of data to a central station, and . . . to receive acknowledge signals and data from the central station.” Ex. 1005, 2:36−56 (emphasis added). Tymes describes that the central station includes a number of base stations connected to a central computer. Id. at 3:21−25. As shown in Figure 1, the network includes base stations 12−14, each of which “is coupled by an RF link to a number of remote units.” Id. at 4:61−5:44. The RF link is used for sending “data packets from the remote terminals to the base stations and return.” Id. at 3:48−51 (emphasis added), 6:66–7:2. In fact, Tymes teaches that the “advantage of this type of RF data link is that a band may be used which does not require site licensing by the F.C.C.” Id. at 3:55−59. Contrary to Patent Owner’s assertion that “low-power” refers to only the remote terminals, Tymes describes a low-power network that includes base stations. As Petitioner also notes (Pet. 66–67, n.38), Tymes teaches an “indoor” limited range network and an RF data link “usable without site licensing under F.C.C. regulations, so that the expense and delays incident to such licensing are eliminated or minimized.” Ex. 1005, 2:36–56. Significantly, Tymes discloses that the optimum frequency is in the 902−928 MHz range 54 for the RF transceivers in the base stations. Id. at 6:66–7:2, 13:58–61, 18:1−3. The FCC limits the power for unlicensed transmitters, and the power limit under the FCC regulations is less than or equal to one watt for the disclosed 902–928 MHz range. Ex. 1010, 217; Ex. 1017, 7:9–11, 31–34. Mr. Geier testifies that an ordinarily skilled artisan “would have understood that an indoor communications network as taught by Tymes requires only a limited range (e.g., 1 mile or less (the length of a storage facility)), so that high-powered transceivers would be unnecessary and disfavored,” and that such an artisan “would have considered a transmission of 1 Watt to be a ‘low-power’ transmission, with a limited range of approximately 1 mile.” Ex. 1003 ¶¶ 358−359. Mr. Geier also testifies that such an artisan would have had a reason to use low-power transceivers in the base stations so that they are usable indoors without licensing under the FCC regulations. Id. We credit Mr. Geier’s testimony as it is consistent with Tymes’ teachings and other evidence. Ex. 1005, 2:36–56, 6:66–7:2, 13:58−61, 18:1−3, Figs. 1, 3, 10; Ex. 1010, 21; Ex. 1017, 7:9−11, 29−34 (explaining that “unlicensed systems using conventional modulation techniques attain ranges on the order of 500−1000 feet” (emphasis added)).” slip op. at 54

  Patent outcomesUS 8,908,842 unpatentable
  Claim construction§ 101 eligibility§ 103 obviousness§ 112 disclosurecites Alice · Mayo · Bilski · Enfish · Phillips · KSR · Graham
  Patents in suitUS 8,908,842
• Mastercard International Inc. v. Leon StamblerAll claims unpatentable
  PTAB · Jul 6, 2016 · CBM2015-00044 · APJ Peter P Chen · CBM · Final written decision

  Claims 51 and 53 are unpatentable as anticipated by Davies; claims 51, 53, 55, and 56 are unpatentable as obvious over Davies and Meyer; claim 55 over Davies and Nechvatal; and claim 56 over Davies, …

  In the decision

  …Pet. 50–63. Patent Owner argues that “citations to Meyer do not overcome the gaps in Davies” and makes no other substantive arguments as to the teachings of Davies or Meyer as to claims 51 and 53. PO Resp. 48–49. We have determined there is a preponderance of evidence showing that Davies…

  RulingsFinal written decision

  • Skill levelSkill level board ownOther

    “F. Level of Ordinary Skill in the Art Petitioner’s proposal for the level of ordinary skill in the art is “at least a bachelors degree in computer programming and two years’ experience as a programmer or developer in the field of computer science, with a working understanding of cryptographic operations for transforming original input into a coded output using a known algorithm.” Pet. 14–15. Patent Owner has proposed similarly, that one of ordinary skill in the art would possess “(1) undergraduate education in mathematics, physics, computer science, electrical engineering or similar technical subject; and (2) either postgraduate education in networking, cryptography, or other discipline encompassing information theory, or equivalent experience with applications involving communication of financial, military, medical or similarly sensitive data over secure and non-secure networks.” Prelim. Resp. 30–31. We determine that an express definition of the level of ordinary skill is not required. The level of ordinary skill in the art can be reflected in the cited prior art references. See Okajima v. Bourdeau, 261 F.3d 1350, 1355 (Fed. Cir. 2001) (“[T]he absence of specific findings on the level of skill in the art does not give rise to reversible error ‘where the prior art itself reflects an appropriate level and a need for testimony is not shown.’”) (internal quotations omitted); In re GPAC Inc., 57 F.3d 1573, 1579 (Fed. Cir. 1995). Therefore, we find the level of ordinary skill in the art to be reflected in the cited references.” slip op. at 16

  • Claim Construction › Threshold & procedure › Whether a term needs construction (O2 Micro)Term construed board ownDecided for petitioner

    “1. “variable authentication number (VAN)” In the Decision to Institute, we construed the term “variable authentication number” or “VAN” as “a variable number resulting from a coding operation that can be used in verifying the identity of a party or the integrity of information or both.” Dec. to Inst. 8. See also Case IPR2014-00694, slip op. at 8–9 (PTAB Oct. 31, 2014) (Paper 10). Patent Owner “does not challenge this construction.” PO Resp. 16–17. Patent Owner asserts additional construction of the term is necessary for CBM standing issues, but does not elaborate further. PO Resp. 1. Patent Owner also argues we incorrectly applied the broadest reasonable interpretation to the term in the Decision to Institute. PO Resp. 9. The Decision to Institute noted that our review of the claims of the expired ’302 patent is similar to that of a district court’s review, In re Rambus, Inc., 694 F.3d 42, 46 (Fed. Cir. 2012); Phillips v. AWH Corp., 415 F.3d 1303, 1327 (Fed. Cir. 2005), but inadvertently mentioned the broadest reasonable interpretation standard in construing this term. Dec. to Inst. 7–8. We reaffirm our agreement with Patent Owner that the Phillips framework is applied to the expired ’302 patent. Our construction of “VAN” is the same under either claim construction standard. We reject Patent Owner’s undeveloped argument regarding standing, and maintain the construction of VAN from the Decision to Institute, as the ordinary and customary meaning of the term: “a variable number resulting from a coding operation that can be used in verifying the identity of a party or the integrity of information or both.”” slip op. at 10

  • Claim Construction › Intrinsic evidence (Phillips canons) › Plain and ordinary meaning to a POSITATerm construed patent owner constructionDecided for patent owner

    “2. Sequence of method steps: receiving, generating In the Decision to Institute, we agreed with Patent Owner and construed the sequence of method steps in independent claim 51 to mean that at least a portion of the receiving step must precede the generating step. Dec. to Inst. 8. See also Case IPR2014-00694, slip op. at 11–14 (PTAB Oct. 31, 2014) (Paper 10). We maintain that construction as the ordinary and customary meaning of the sequence of the receiving and generating method steps.” slip op. at 11

  • Claim Construction › Intrinsic evidence (Phillips canons) › Preamble limiting or notPreamble limitingDecided for patent owner

    “intended use of an invention is generally not treated as limiting the scope of the claim. Boehringer Ingelheim Vetmedica, Inc. v. Schering-Plough Corp., 320 F.3d 1339, 1345 (Fed. Cir. 2003). However, “a preamble limits the invention if it recites essential structure or steps, or if it is ‘necessary to give life, meaning, and vitality’ to the claim.” Catalina Mktg. Int'l, Inc. v. Coolsavings.com, Inc., 289 F.3d 801, 808 (Fed. Cir. 2002) (citing Pitney Bowes Inc. v. Hewlett-Packard Co., 182 F.3d 1298, 1305 (Fed. Cir. 1999). “The effect preamble language should be given can be resolved only on review of the entirety of the patent to gain an understanding of what the inventors actually invented and intended to encompass by the claim.” Corning Glass Works v. Sumitomo Elec. U.S.A., Inc., 868 F.2d 1251, 1257 (Fed. Cir. 1989). When the limitations in the body of the claim rely upon or derive essential structure from the preamble elements, e.g., the preamble serves as an antecedent basis for limitations in the claim, then the preamble acts as a necessary component of the claimed invention and is limiting. See Eaton Corp. v. Rockwell Int’l Corp., 323 F.3d 1332, 1339 (Fed. Cir. 2003). In this case, the preamble of independent claim 51 recites “a credential being previously issued,” and the limitations of the claim include “determining whether the at least a portion of the received funds transfer information is authentic by using the VAN and the credential information.” Ex. 1001, 33:18–19, 33:29–31. Thus, the preamble’s recitation of “a credential” is an antecedent basis for the recited “the credential information” in the “determining” step, and we determine that the preamble limits the scope of the challenged independent claim 51 and dependent claims 53, 55, and 56.” slip op. at 11

  Patent outcomesUS 5,793,302 unpatentable
  Claim construction§ 102 anticipation§ 103 obviousnesscites Phillips · KSR · Graham
  Patents in suitUS 5,793,302
• Informatica Corporation v. Protegrity CorporationAll claims unpatentable
  PTAB · May 31, 2016 · CBM2015-00021 · APJ Kevin F Turner · CBM · Final written decision

  Claims 1–8 and 18–53 are unpatentable under § 101; claims 1, 2, 8, 19–26, 29, 31–35, 37–44, and 47–53 are also unpatentable under § 103.

  In the decision

  …idea of rule-based data access.” Pet. 21. According to Petitioner, such processes were well-known in the art at the time and the fundamental teaching of Hoffman. See Ex. 1003 ¶ 46. As well, access requirements not based on user identity and not changeable by users were well-known. Id.…

  RulingsFinal written decision

  • Claim Construction › Intrinsic evidence (Phillips canons) › Plain and ordinary meaning to a POSITATerm construed petitioner constructionDecided for petitioner

    “claim, and “it is the single best guide to the meaning of a disputed term.” Vitronics Corp. v. Conceptronic, Inc., 90 F.3d 1576, 1582 (Fed. Cir. 1996). The written description of the ’201 Patent provides specific definitions of many terms (Ex. 1001, 2:64–3:43) but does not contain a definition of “database.” The claimed database for storing a plurality of data element values corresponds to the O-DB database disclosed in the ’201 Patent. The O-DB database is part of a larger “database management system” that includes multiple databases. Id. at 5:49–6:12, Fig. 3. Similar to the other databases, the O-DB database is described as containing data and, in particular, data to be protected. Id. at 5:53–58. Contrary to Patent Owner’s argument (Resp. 20), the ’201 Patent does not describe the O-DB database, or any other database, as performing any other data processing or managing functions. In particular, the ’201 Patent does not describe that the O-DB database produces the compelling calling to the data protection catalogue. See Ex. 1001, 10:44–58 (“is first collected by the system”); see id. at Abstract, 2:54– 61, 3:51–65, 4:16–22, 7:57–61 (describing a compelling calling to a data protection catalogue, but failing to describe the compelling calling being produced by the O-DB database).” slip op. at 9

  • Claim Construction › Threshold & procedure › Whether a term needs construction (O2 Micro)Plain and ordinary meaningOther

    “Claims 1 and 8 do not recite unencrypted data element values, and only recites “encrypted data element values.” Those claims do not specify that the “given data element value” should be encrypted or unencrypted. We are not persuaded by Patent Owner’s declarants (Ex. 2063 ¶ 33; Ex. 2064 ¶ 48) as their testimonies are conclusory and are unsupported by the Specification or claims of the ’201 Patent. Although the “given data element value” could be the unencrypted data element value, it need not be in the context of claim 1.” slip op. at 15

  • ExcludeMotion to exclude, deniedDenied

    “As the Board has noted in numerous cases, “the Board, sitting as a non-jury tribunal with administrative expertise, is well-positioned to determine and assign appropriate weight to the evidence presented in this trial, without resorting to formal exclusion that might later be held reversible error.” See, e.g., Liberty Mutual Insurance Co. v. Progressive Casualty Insurance Co., CBM2012-00002, Paper 66 at 70 (PTAB Jan. 23, 2014); Gnosis S.P.A., et al. v. S. Alabama Medical Science Foundation, IPR2013- 00118, Paper 64 at 43 (PTAB June 20, 2014); S.E.C. v. Guenthner, 395 F. Supp. 2d 835, 842 n.3 (D. Neb. 2005); Opp. to Mot. Exclude 4. We, thus, are not persuaded by Petitioner to exclude Exhibits 2064, 2089, and 2093 and Petitioner’s Motion to Exclude is denied. Additionally, we are also not persuaded that Dr. Direen is unqualified to testify as an expert. As Petitioner points out, Dr. Direen has knowledge, skill, experience, and training beyond degrees and is the holder of several patents. Opp. to Mot. Exclude 3–8; See Ex. 1002 ¶¶ 1–7 (discussing additional credentials and qualifications). Given this, we are persuaded that Dr. Direen is qualified to testify as an expert as to what a person of ordinary skill in the art would know or understand during the relevant time frame.” slip op. at 52

  • Strike new argumentNew argument disregardedGranted

    “The scheduling order states “[a] motion for observation on cross- examination provides the parties with a mechanism to draw the Board’s attention to relevant cross-examination testimony of a reply witness because no further substantive paper is permitted after the reply” and refers to the Office Patent Trial Practice Guide. Paper 15, 4–5. The Trial Practice Guide states: In the event that cross-examination occurs after a party has filed its last substantive paper on an issue, such cross-examination may result in testimony that should be called to the Board’s attention, but the party does not believe a motion to exclude the testimony is warranted. The Board may authorize the filing of observations to identify such testimony and responses to observations, as defined below. 77 Fed. Reg. at 48,767–68 (emphasis added).” slip op. at 53

  Patent outcomesUS 6,321,201 unpatentable
  Claim construction§ 101 eligibility§ 103 obviousnesscites Alice · Bilski · Graham
  Patents in suitUS 6,321,201
• Square, Inc. v. Protegrity CorporationAll claims unpatentable
  PTAB · Apr 28, 2016 · CBM2015-00014 · APJ Kevin F Turner · CBM · Final written decision

  Claims 1–7 and 18–35 are unpatentable under § 101 as ineligible subject matter and under § 103 as obvious over the instituted reference combinations.

  In the decision

  …asserts that “[r]equiring security measures to be followed for every data request was well-known in the art at the time and the fundamental teaching of Hoffman.” Pet. 33 (citing Ex. 1023 ¶ 45). See also Ex. 1005, 8 (“[A]ccess can be controlled at arbitrary levels, even at the bit level”).…

  RulingsFinal written decision

  • Expert testimonyPatent owner expert discountedDecided for petitioner

    “Mr. Mattsson’s and Dr. Direen’s testimony is unpersuasive because it is inconsistent with the ’201 Patent. As discussed above, the ’201 Patent describes the O-DB as one database in a larger database management system. Ex. 1001, 5:49–6:12. The ’201 Patent describes the O-DB database as containing data and describes the modules of the larger database management system as performing data processing. Id. at 5:53–58, 6:13–45. The ’201 Patent does not describe the O-DB database as producing the compelling calling. See Ex. 1001, 10:44–58 (“is first collected by the system”); see id. at Abstract; 2:54–61, 3:51–65; 4:16–22; 7:57–61 (disclosing a compelling calling to a data protection catalogue, but failing to describe the compelling calling being produced by the O-DB database). The assertion that the compelling calling is produced by the O-DB database is only found in Patent Owner’s arguments, Mr. Mattsson’s testimony, and Dr. Direen’s testimony, and not the ’201 Patent. See, e.g., Ex. 2066 ¶¶ 13, 17–19, 37; Ex. 2067 ¶ 57. Extraneous features should not be read into the claim. Renishaw PLC v. Marposs Societa’ per Azioni, 158 F.3d 1243, 1249 (Fed. Cir. 1998); E.I. du Pont de Nemours & Co. v. Phillips Petroleum Co., 849 F.2d 1430, 1433 (Fed. Cir. 1988). In that regard, “extrinsic evidence may be used only to assist in the proper understanding of the disputed limitation; it may not be used to vary, contradict, expand, or limit the claim language from how it is defined, even by implication, in the specification or file history.” Bell Atl. Network Servs. v. Covad Commc'ns Grp., 262 F.3d 1258, 1269 (Fed. Cir. 2001); see Vitronics, 90 F.3d at 1584 (“expert testimony, which was inconsistent with the specification and file history, should have been accorded no weight”). Further, we give little weight to Mr. Mattsson’s testimony because Mr. Mattsson is not a disinterested witness. Mr. Mattsson is Patent Owner’s Chief Technology Officer (Ex. 2066 ¶ 1) and has an interest in the outcome of this proceeding.” slip op. at 11

  • BurdenUnpatentable

    “element type, are stored in a separate data protection catalogue. Ex. 1001, 11:15–28. Data processing computers having separate databases, which store associated data and associated attributes, were well-known and conventional at the time of filing the ’201 Patent. See Ex. 1023 ¶¶ 17–20, 23–28. Storing data and associated rules in separate databases is nothing more than routine data gathering and does not transform the abstract idea into a patent-eligible invention. See CyberSource, 654 F.3d at 1370. Claim 1 also recites that the first database has a table structure with rows and columns, which is also conventional and was well-known. See Ex. 1023 ¶ 19. Restricting access to columns or fields of databases is well-understood and conventional activity. See Ex. 1023 ¶ 24. Well-understood, routine, conventional activity does not add significantly more to the abstract idea. Mayo, 132 S. Ct. at 1298. Claim 1 further requires that for each user-initiated measure aiming at processing of a given data element value, a calling is produced to the data element protection catalogue for the protection attributes of the data element type. Ex. 1001, 11:29–34. This is well-understood, routine, conventional activity that does not add significantly more to the abstract idea. Mayo, 132 S. Ct. at 1298; see Pet. 30; Ex. 1023 ¶ 27.” slip op. at 32

  • Claim Construction › Intrinsic evidence (Phillips canons) › Plain and ordinary meaning to a POSITATerm construed petitioner constructionDecided for petitioner

    “b. Written Description The written description is “always highly relevant” in construing a claim, and “it is the single best guide to the meaning of a disputed term.” Vitronics Corp. v. Conceptronic, Inc., 90 F.3d 1576, 1582 (Fed. Cir. 1996). The written description of the ’201 Patent provides specific definitions of many terms (Ex. 1001, 2:64–3:43) but does not contain a definition of “database.”” slip op. at 9

  • Claim Construction › Threshold & procedure › Whether a term needs construction (O2 Micro)No construction neededDecided for petitioner

    “vi. Other Proposed Constructions Both Petitioner and Patent Owner propose constructions for various other claim terms. See Pet. 13–22; Prelim. Resp. 49–53. For the purposes of our review of the claims of the ’201 Patent, however, no explicit construction of any other claim term is needed.” slip op. at 16

  Patent outcomesUS 6,321,201 unpatentable
  Claim construction§ 101 eligibility§ 103 obviousnesscites Alice · Mayo · Bilski · Graham
  Patents in suitUS 6,321,201
• FFF Enterprises, Inc. v. Amerisourcebergen Specialty Group, Inc.All claims unpatentable
  PTAB · Jan 28, 2016 · CBM2014-00154 · APJ Christopher L Crumbley · CBM · Final written decision

  Claims 1 and 2 are unpatentable as anticipated by both Dearing under § 102(b) and Gibb under § 102(a).

  In the decision

  …the server system creates an invoice.” Tr. 79. Referring to the “administering system” disclosure noted above, counsel continued, “[t]here is no teaching, no teaching in Gibb that the server that is mentioned there has anything to do with creating an invoice. And for that reason alone Gibb…

  RulingsFinal written decision

  • BurdenDecided for petitioner

    “For the foregoing reasons, FFF has proven by a preponderance of the evidence that Dearing discloses all elements of challenged claims 1 and 2.10 We, therefore, conclude that these claims are anticipated by Dearing, and thus are unpatentable under 35 U.S.C. § 102.” slip op. at 31

  • Skill levelOther

    “term in light of its broadest reasonable interpretation, as understood by one of ordinary skill in the art and as consistent with the specification of the ’607 patent. 37 C.F.R. § 42.300(b); see In re Cuozzo Speed Techs., LLC, 793 F.3d 1268, 1278–79 (Fed. Cir. 2015), cert. granted sub nom. Cuozzo Speed Techs. LLC v. Lee, 84 U.S.L.W. 3218 (Jan. 15, 2016) (No. 15-446). In the Decision to Institute, we construed the term consignment product unit as “products that are considered sold when removed from the cabinet or the product packaging.” Dec. 13–15. We also held that the server system creates an invoice when the product units are removed from the inventory should be given its ordinary meaning, and manage the inventory needed no explicit construction. Dec. 11–13, 15–16. In its Response, ABSG challenges our treatment of all three claim terms.” slip op. at 13

  • Claim Construction › Intrinsic evidence (Phillips canons) › Plain and ordinary meaning to a POSITATerm construed board ownDecided for petitioner

    “While the broadest reasonable interpretation standard does not require us to construe claims to preserve their validity—and indefiniteness of the claims is not before the Board in this proceeding, in any event—we are mindful that adopting ABSG’s construction would mean that a person of ordinary skill in the art would be unable to determine whether a potentially infringing system falls within the scope of the claim unless he or she has access to the contracts governing the sale of the items within the cabinet. See Geneva Pharm., Inc. v. GlaxoSmithKline PLC, 349 F.3d 1373, 1384 (Fed. Cir. 2003) (“A claim is indefinite if its legal scope is not clear enough that a person of ordinary skill in the art could determine whether a particular composition infringes or not.”). Furthermore, legal ownership is a distinction “discernable only to the human mind,” similar to limitations found to have no patentable weight under the printed matter doctrine unless they have a functional or structural relationship to the physical substrate. See In re Distefano, 808 F.3d 845, 848 (Fed. Cir. 2015); In re Jie Xiao, 462 F. App’x 947, 950 (Fed. Cir. 2011) (nonprecedential). Though the 19 ownership of the products is not printed matter, the logic of those cases is equally applicable here. See King Pharmaceuticals, Inc. v. Eon Labs, Inc., 616 F.3d 1267, 1279 (Fed. Cir. 2010) (“The rationale behind this line of [printed matter] cases is preventing the indefinite patenting of known products by the simple inclusion of novel, yet functionally unrelated limitations.”); see also Ex parte Graff, Appeal 2012-003941, 2013 WL 3873066, at *3 (PTAB July 23, 2013) (property interests are “legal abstractions” that are given no patentable weight), aff’d by In re Graff, 585 F. App’x 1012 (Fed. Cir. 2014) (nonprecedential). While not controlling on the broadest reasonable interpretation analysis, we nevertheless take into account the fact that ABSG’s proffered construction raises these concerns. For these reasons, we reaffirm our prior claim construction analysis, and interpret consignment product units as “products that are considered sold when removed from the cabinet or the product packaging.”” slip op. at 19

  • Claim Construction › Threshold & procedure › Whether a term needs construction (O2 Micro)No construction neededDecided for petitioner

    “We declined to adopt ABSG’s construction because we concluded it was overly narrow, and nothing in the specification tied invoicing to the “unique RFID serial number” of an exact product. Dec. 12–13. Rather, the specification merely states that the server “generate[s] billing and invoice data according to the reports from cabinets of product units that are delivered . . . or consumed.” Ex. 1001, 5:57–60. This could be a report of a unique RFID serial number, but that is not the only possibility. Indeed, the specification states that “serial numbers” are not required by the invention at all. Ex. 1001, 4:58–61 (“[T]he term ‘serial number’ will be used herein to refer to the unique identifier, although those of skill in the art will recognize that any other style of unique identifier can be used.”). ABSG’s citations from the specification, that products are tracked by RFID serial number, are 24 not in the context of invoicing. In view of the complete record, our reasoning from the Decision to Institute holds, and ABSG’s arguments in its Response fail to persuade us otherwise.” slip op. at 24

  Patent outcomesUS 8,285,607 unpatentable
  Claim construction§ 102 anticipation
  Patents in suitUS 8,285,607
• Apple Inc. v. Smartflash LLCAll claims unpatentable
  PTAB · Sep 25, 2015 · CBM2014-00102 · APJ Jennifer S Bisk · CBM · Final written decision

  Claims 1, 2, and 11–14 are unpatentable as obvious under § 103 over the instituted combinations of Stefik ’235 and Stefik ’980, Stefik ’235, Stefik ’980, and Poggio, or Ginter.

  In the decision

  …’980 by reference, they should be considered a single reference,” and additionally provides rationale for the combination the combination of the teachings of Stefik ’235 and Stefik ’980. 102 Pet. 26 n.13. In its Response, Patent Owner does not dispute Petitioner’s contentions regarding “Stefik”…

  RulingsFinal written decision

  • Expert testimonyPetitioner expert creditedOther

    “Patent Owner has not articulated a persuasive reason for giving Mr. Wechselberger’s declarations, as a whole, little or no weight in our analysis. Patent Owner has not cited any authority requiring an expert to recite or apply the “preponderance of the evidence” standard in order for the expert opinion to be accorded weight. Under 37 C.F.R. § 42.1(d), we apply the preponderance of the evidence standard in determining whether Petitioner has established unpatentability. In doing so, it is within our discretion to determine the appropriate weight to be accorded the evidence presented, including expert opinion, based on the disclosure of the underlying facts or data upon which that opinion is based. Thus, we decline to make a determination about Mr. Wechselberger’s opinion, as a whole. Rather, in our analysis we will consider, as it arises, relevant portions of Mr. Wechselberger’s testimony and determine the appropriate weight to accord that particular testimony.” slip op. at 6

  • Claim Construction › Intrinsic evidence (Phillips canons) › Plain and ordinary meaning to a POSITATerm construed board ownDecided for petitioner

    “definitions of the term—it encompasses data relating to future, current, and past payments. In other words, we are persuaded that the ’221 patent does not incorporate an element of timing into the definition of payment data. First, the plain and ordinary meaning of the two words that make up the term—“payment” and “data”—do not incorporate any notion of time and nothing about their combination changes that determination. Second, we agree with both parties that language in the ’221 patent supports “payment data” representing data existing prior to, concurrent with, and after payment of the requested content. For example, the ’221 patent states that “payment data for making a payment to the system owner is received from the smart Flash card by the content access terminal and forwarded to an e-payment system.” Ex. 1001, 20:59–62. We agree with Patent Owner that this language indicates that payment data exists prior to the payment being made for the requested content. See PO Resp. 8. Petitioner does not address this language. See Reply 3–5. In addition, we agree with Petitioner that the language in the ’221 patent, “payment data received may either be data relating to an actual payment made to the data supplier, or it may be a record of a payment made to an e-payment system,” (Ex. 1001, 6:60–63) clearly shows that “payment data” includes data for payments that have already been made. See Reply 3–5. Moreover, the plain and ordinary meaning of data does not allow for a change in the character of that data based on when it is used in a transaction. For example, a credit card number may qualify as “data relating to payment” before that credit card number is processed, while the credit card number is being processed, and after the credit card number is processed. Thus, without an express description to the contrary, we presume that “payment data” retains the same meaning before, during, and after the payment operation. Neither party points to persuasive evidence of any such contrary description. In fact, the ’221 patent broadly describes “payment data” in several places as “comprising data relating to payment for the requested data item.” Ex. 1001, 6:51–53, 10:26–30, 10:39–41, 10:44–46. This is consistent with the plain meaning of the term. Thus, we are persuaded that the broadest reasonable interpretation of “payment data” in light of the specification of the ’221 patent is “data relating to payment for the requested data item.”” slip op. at 9

  • Obviousness (§103) › Motivation to combine / reasonable expectation of successUnpatentableMotivation foundUnpatentable

    “We are not persuaded that Ginter’s disclosure is so restricted. At a minimum, we are persuaded that a person of ordinary skill would have found it obvious to modify Ginter to use payment in pre-purchase processing. For example, Ginter teaches processes that include “governing usage of, auditing of, and where appropriate, payment for VDE objects 300 (through the use of prepayments, credits, real-time electronic debits from bank accounts and/or [other deposit accounts]).” Ex.1015, 63:34–41 (emphasis added). Patent Owner argues that this disclosure relates, not to payments for a particular VDE content object, but rather to payment “for content at some future time when a VDE object has actually been selected and the budget has been used and the metering has occurred.” Tr. 79:13–80:19, 81:19–21 (“it is not an indication, even if it says real-time, that it is real-time for use of the VDE object that is being requested.”). Although we agree with Patent Owner that this is one way of reading the quoted language of Ginter, we are not persuaded that it is the only reading or even the most natural reading of this passage. Nor are we persuaded that it would require a change in the principle of operation of Ginter to allow for prepayment of content. Patent Owner does not explain in their brief what they mean by “principle of operation,” and instead simply cites to In re Ratti, 270 F.2d 810, 812–13 (CCPA 1959). In Ratti, the court held that it would not be obvious to replace a “cylindrical sheet metal reinforcing member” in a seal with “an annular set of outwardly biased spring fingers” because to do so “would require a substantial reconstruction and redesign of the elements shown in” the seal “as well as a change in the basic principles under which the [seal’s] construction was designed to operate.” The timing of payment in a distribution system such as Ginter does not “require a substantial reconstruction and redesign,” but instead is a minor variation in basic payment processing and validation that would be well within the understanding of a person of ordinary skill. See, e.g., Ex. 1014, 29:61–64; Ex. 1031, 16:15–27:9. We are, therefore, persuaded that a skilled artisan would, at a minimum, find prepayment for digital content obvious based on the explicit teachings of Ginter. This is especially true given that, as we explained in the Decision to Institute, Ginter describes significant flexibility of its system stating that “[a]ll participants of VDE 100 have the innate ability to participate in any role” and “[r]oyalty payments for the new works may be accessed by the publisher, distributors, or end-users, and may be tracked and electronically collected at any stage of the chain.” Dec. 21; Ex. 1015, 255:22–43. We found this disclosure supported Petitioner’s assertion that “the known flexibility in such distribution systems, and underscores that one of ordinary skill would have known that combinations between and among disclosures of such distribution systems would have been obvious to one of [ordinary] skill in the art.” Dec. 21 (quoting 103 Pet. 30–31). Patent Owner does not address this contention, which we continue to find persuasive.” slip op. at 28

  • Obviousness (§103) › Motivation to combine / reasonable expectation of success › Teaching awayTeaching away not foundUnpatentableDecided for petitioner

    “We are not persuaded that Ginter’s disclosure of sufficient credit teaches away from using a real-time debit system. According to Ginter, “VDE ensures that certain prerequisites necessary for a given transaction to occur are met,” including that modules and data might “specify that sufficient credit from an authorized source must be confirmed as available.” Ex. 1015, 20:23–29. Directly after this statement, Ginter continues that “[i]t might further require certain . . . modules execute as processes at an appropriate time to ensure that such credit will be used in order to pay for user use of the content.” Id. at 20:29–32. We are persuaded that in light of this disclosure, a skilled artisan would not be discouraged from, but, indeed, would find it obvious to, execute such processes and forward the notification of ensured credit to the data supplier prior to transfer of the requested content. Thus, we do not agree with Patent Owner that Ginter teaches away from using a real-time debit system.” slip op. at 33

  Patent outcomesUS 8,118,221 unpatentable
  Claim construction§ 103 obviousness
  Patents in suitUS 8,118,221
• Apple Inc. v. Smartflash LLCAll claims unpatentable
  PTAB · Sep 25, 2015 · CBM2014-00103 · APJ Jennifer S Bisk · CBM · Final written decision

  Claims 1, 2, and 11–14 are unpatentable under § 103 over the instituted combinations of Stefik ’235 and Stefik ’980, Stefik ’235, Stefik ’980, and Poggio, and Ginter.

  In the decision

  …’980 by reference, they should be considered a single reference,” and additionally provides rationale for the combination the combination of the teachings of Stefik ’235 and Stefik ’980. 102 Pet. 26 n.13. In its Response, Patent Owner does not dispute Petitioner’s contentions regarding “Stefik”…

  RulingsFinal written decision

  • Expert testimonyPetitioner expert creditedPatent owner expert creditedOther

    “Wechselberger’s declarations, as a whole, little or no weight in our analysis. Patent Owner has not cited any authority requiring an expert to recite or apply the “preponderance of the evidence” standard in order for the expert opinion to be accorded weight. Under 37 C.F.R. § 42.1(d), we apply the preponderance of the evidence standard in determining whether Petitioner has established unpatentability. In doing so, it is within our discretion to determine the appropriate weight to be accorded the evidence presented, including expert opinion, based on the disclosure of the underlying facts or data upon which that opinion is based. Thus, we decline to make a determination about Mr. Wechselberger’s opinion, as a whole. Rather, in our analysis we will consider, as it arises, relevant portions of Mr. Wechselberger’s testimony and determine the appropriate weight to accord that particular testimony.” slip op. at 6

  • Claim Construction › Intrinsic evidence (Phillips canons) › Plain and ordinary meaning to a POSITATerm construed board ownDecided for petitioner

    “definitions of the term—it encompasses data relating to future, current, and past payments. In other words, we are persuaded that the ’221 patent does not incorporate an element of timing into the definition of payment data. First, the plain and ordinary meaning of the two words that make up the term—“payment” and “data”—do not incorporate any notion of time and nothing about their combination changes that determination. Second, we agree with both parties that language in the ’221 patent supports “payment data” representing data existing prior to, concurrent with, and after payment of the requested content. For example, the ’221 patent states that “payment data for making a payment to the system owner is received from the smart Flash card by the content access terminal and forwarded to an e-payment system.” Ex. 1001, 20:59–62. We agree with Patent Owner that this language indicates that payment data exists prior to the payment being made for the requested content. See PO Resp. 8. Petitioner does not address this language. See Reply 3–5. In addition, we agree with Petitioner that the language in the ’221 patent, “payment data received may either be data relating to an actual payment made to the data supplier, or it may be a record of a payment made to an e-payment system,” (Ex. 1001, 6:60–63) clearly shows that “payment data” includes data for payments that have already been made. See Reply 3–5. Moreover, the plain and ordinary meaning of data does not allow for a change in the character of that data based on when it is used in a transaction. For example, a credit card number may qualify as “data relating to payment” before that credit card number is processed, while the credit card number is being processed, and after the credit card number is processed. Thus, without an express description to the contrary, we presume that “payment data” retains the same meaning before, during, and after the payment operation. Neither party points to persuasive evidence of any such contrary description. In fact, the ’221 patent broadly describes “payment data” in several places as “comprising data relating to payment for the requested data item.” Ex. 1001, 6:51–53, 10:26–30, 10:39–41, 10:44–46. This is consistent with the plain meaning of the term. Thus, we are persuaded that the broadest reasonable interpretation of “payment data” in light of the specification of the ’221 patent is “data relating to payment for the requested data item.”” slip op. at 9

  • Obviousness (§103) › Graham factors (scope of art, differences, level of skill)UnpatentableUnpatentable

    “evidence, including the disclosure of both Stefik references and the detailed claim chart appearing on pages 41–69 of the Petition. Despite the counter-arguments in Patent Owner’s Response, and the evidence cited therein, which we also have considered, for the reasons discussed below, Petitioner has shown, by a preponderance of the evidence, that each of claims 1, 11, and 12 is unpatentable under 35 U.S.C. § 103 as having been obvious over the combination of Stefik ’235 and Stefik ’980.” slip op. at 16

  • Obviousness (§103) › Motivation to combine / reasonable expectation of successMotivation foundUnpatentable

    “ultimate issue here. The relevant inquiry is whether the transfer of payment data, as claimed, would have been obvious to those of ordinary skill in the art in light of the combined teachings of Stefik ’235 and Stefik ’980. See Leapfrog Enters., Inc. v. Fisher-Price, Inc., 485 F.3d 1157, 1162 (Fed. Cir. 2007). Petitioner asserts that a person of ordinary skill in the art would have understood the Stefik references to teach the acceptance of fees and payments for digital works and, to support this assertion, points to the express disclosure that “billing transactions were well understood in the state of the art.” 102 Pet. 54–55 n.26; Ex. 1014, 29:61–64; see also Ex. 1021, (App’x D) 79–82. Indeed, Patent Owner’s expert, Dr. Katz, acknowledged that a person of ordinary skill would have understood the basics of payment validation. See, e.g., Ex. 1031, 16:15–27:9. Patent Owner does not point to anything in the claim language indicating that such basic payment processing and validation is outside the scope of the claims. Thus, we are persuaded that a person of ordinary skill would find the Stefik references sufficiently teach payment processing and validation such that the claimed subject matter relating to transferring payment data would have been obvious.” slip op. at 19

  Patent outcomesUS 8,118,221 unpatentable
  Claim construction§ 103 obviousness
  Patents in suitUS 8,118,221
• Ebay Inc. v. Moneycat Ltd.All claims unpatentable
  PTAB · Sep 23, 2015 · CBM2014-00092 · APJ Minn Chung · CBM · Final written decision

  Claims 1, 2, and 4–11 are unpatentable as obvious over the instituted combinations of Teramura or Bernstein with the APA NetCash System, with Popolo added for specified dependent claims.

  In the decision

  …under § 102(a) as described in the Medvinsky-Neuman publications and as known or used by others in this country; and (2) an admission regarding the teachings of the APA NetCash System—i.e., the teachings of the APA NetCash System are described in column 2, line 37 through column 3, line 32 and…

  RulingsFinal written decision

  • BurdenDecided for petitioner

    “35 U.S.C. § 103(a) over the combination of Teramura and the APA NetCash System. Pet. 41–52. Upon review of all of the parties’ papers and supporting evidence discussed in those papers, we are persuaded that Petitioner has demonstrated, by a preponderance of evidence, that claims 1, 2, 6–8, and 11 are unpatentable under 35 U.S.C. § 103(a) over the combination of Teramura and the APA NetCash System.” slip op. at 25

  • Claim Construction › Intrinsic evidence (Phillips canons) › Plain and ordinary meaning to a POSITATerm construed patent owner constructionDecided for patent owner

    “Currency Issuing Authority Trusted Server” The term “Currency Issuing Authority trusted server” appears in all claims of the ’602 patent. See Pet. 11–12. Petitioner proposes that the term “should be interpreted as a server trusted to make transactions using data packets issued from a particular CIA.” Pet. 12. Patent Owner had argued that Petitioner’s proposal does not comport with the broadest reasonable construction standard. Prelim. Resp. 24. In the Decision to Institute, we adopted Patent Owner’s construction of the term “Currency Issuing Authority trusted server” to mean a “server that is trusted by the Currency Issuing Authority” under the broadest reasonable interpretation standard. Dec. to Inst. 7 (citing Ex. 1001, col. 6, l. 65–col. 7, l. 6, col. 11, ll. 58–64). In the Patent Owner’s Response and the Petitioner’s Reply, the parties do not dispute the construction of this term or any other terms. We see no reason, therefore, to revise the claim construction adopted in our Decision to Institute. Accordingly, we construe the term “Currency Issuing Authority trusted server” to mean “a server that is trusted by the Currency Issuing Authority.” We see no need to construe expressly any other claim terms for purposes of this Decision. See, e.g., Vivid Techs., Inc. v. Am. Sci. & Eng’g, Inc., 200 F.3d 795, 803 (Fed. Cir. 1999) (only those terms that are in controversy need to be construed, and only to the extent necessary to resolve the controversy). slip op. at 9

  • Novelty / Anticipation (§102) › Prior-art status of a reference › Printed publication / public accessibilityPrinted publication establishedReference is prior artDecided for petitioner

    “available to the public” for the purposes of 35 U.S.C. § 102 is a question of law based on underlying findings of fact. In re Enhanced Sec. Research, LLC, 739 F.3d 1347, 1354 (Fed. Cir. 2014) (citing In re Hall, 781 F.2d 897, 899 (Fed.Cir.1986)). The Federal Circuit “has interpreted § 102 broadly, explaining that even relatively obscure documents qualify as prior art so long as the public has a means of accessing them.” Id. (citing Hall, 781 F.2d at 899). 22 Our leading case on public accessibility is In re Hall, 781 F.2d 897 (Fed. Cir. 1986). In Hall we concluded that “a single cataloged thesis in one university library” constitutes “sufficient accessibility to those interested in the art exercising reasonable diligence.” Id. at 900. Thereafter, in Constant v. Advanced Micro–Devices, Inc., we explained that “[a]ccessibility goes to the issue of whether interested members of the relevant public could obtain the information if they wanted to.” 848 F.2d 1560, 1569 (Fed. Cir. 1988). Therefore, “[i]f accessibility is proved, there is no requirement to show that particular members of the public actually received the information.” Id. Enhanced Sec. Research, LLC, 739 F.3d at 1354. The determination of whether a document is a “printed publication” under 35 U.S.C. § 102 involves a case-by-case inquiry into the facts and circumstances surrounding its disclosure to members of the public. In re Klopfenstein, 380 F.3d 1345, 1350 (Fed. Cir. 2004). slip op. at 22

  • Obviousness (§103) › Motivation to combine / reasonable expectation of successMotivation foundReasonable expectation foundDecided for petitioner

    “As discussed above, we determined that a person of ordinary skill in the art, at the time of the invention of the ’602 patent, would have been familiar with various conventional systems for electronic payments and electronic currency transactions, including two-step transaction systems that employ trusted intermediary “broker servers,” and would have understood the security problems to be an important issue in existing systems. In view of this knowledge of a person of ordinary skill and her awareness of the security issues, and in further view of the fact that, as discussed above, Teramura addresses the problems of theft and fraud in electronic currency transaction (see Ex. 1007, Abstract, 3:2–18) by using a trusted intermediary broker to send electronic money in two steps, we are persuaded by Petitioner’s arguments that a person of ordinary skill in the art would have been motivated to combine Teramura with the APA NetCash System to improve the security of the electronic currency transaction of the APA NetCash System. We are also persuaded by Petitioner’s argument that a person of ordinary skill in the art would have been guided by Simon and motivated to co-locate the currency server of the APA NetCash System with Teramura’s intermediary broker to further increase the security of the combined system. In addition, we credit the testimony of Dr. Neuman, and 46 are persuaded that a person of ordinary skill would have been motivated by the double-spending problem addressed in the APA NetCash System and Simon’s teaching of currency swapping at the middleman to recognize that, in a combined system where the currency server and the intermediary broker are co-located, the middleman is a preferred location to place the coin exchange function. That is, a person of ordinary skill in the art would have found an internal coin exchange function at the middleman desirable. As discussed above, this means that an ordinary artisan would have found it desirable to have the broker check the coins received from the buyer with the co-located currency server, and, upon verification, replace them with new coins to be sent to the seller, as opposed to forwarding the coins “as-is” to the seller without checking them.” slip op. at 46

  Patent outcomesUS 7,590,602 unpatentable
  Claim construction§ 102 anticipation§ 103 obviousnesscites KSR · Graham
  Patents in suitUS 7,590,602
• Ebay Inc. v. Moneycat Ltd.All claims unpatentable
  PTAB · Sep 23, 2015 · CBM2014-00091 · APJ Minn Chung · CBM · Final written decision

  Claims 1, 2, 4–6, 8, 10, and 11 are unpatentable as obvious over Teramura and APA NetCash, and over Bernstein and APA NetCash.

  In the decision

  …under § 102(a) as described in the Medvinsky-Neuman publications and as known or used by others in this country; and (2) an admission regarding the teachings of the APA NetCash System—i.e., the teachings of the APA NetCash System are described in column 2, line 47 through column 3, line 39 and…

  RulingsFinal written decision

  • BurdenDecided for petitioner

    “under 35 U.S.C. § 103(a) over the combination of Teramura and the APA NetCash System. Pet. 34–46. Upon review of all of the parties’ papers and supporting evidence discussed in those papers, we are persuaded that Petitioner has demonstrated, by a preponderance of evidence, that claims 1, 2, 4–8, 10, and 11 are unpatentable under 35 U.S.C. § 103(a) over the combination of Teramura and the APA NetCash System.” slip op. at 25

  • ExcludeMotion to exclude, deniedDenied

    “NetCash System, Exhibit 1008 (Simon), Exhibit 1009 (Neuman Declaration), and Exhibit 1012 (Neuman Reply Declaration). As the movant, Patent Owner bears the burden of proof to establish that it is entitled to the relief requested—namely, that the material sought to be excluded is inadmissible under the Federal Rules of Evidence. See 37 C.F.R. §§ 42.20(c), 42.62(a). For the reasons discussed below, Patent Owner’s Motion to Exclude is DENIED.” slip op. at 64

  • Skill levelSkill level board ownDecided for petitioner

    “On this record, we find that a person of ordinary skill in the art, at the time of the invention of the ’011 patent, would have been familiar with various conventional systems for electronic payments and electronic currency transactions, including two-step transaction systems that employ intermediary “broker servers” that can be trusted, and would have Resp. 26–29), the Board declined to do so for purposes of institution of trial. Dec. to Inst. 10–11. Therefore, Patent Owner is not justified to presume Dr. Neuman’s testimony is not part of the record in this proceeding and conclude it does not exist for the purposes of trial in this case. 28 understood the security problems to be an important issue in existing systems. In addition, the level of ordinary skill is relatively high and would require knowledge specific to electronic currency and electronic payment transactions. See Ex. 1001, col. 1, ll. 49–54 (“The problem of payments over the Internet is . . . a complicated one, because the use of credit cards over the Internet is unsafe, and because in many transactions the buyer does not wish to provide details of himself, or of his bank account.”) (emphases added).” slip op. at 28

  • Expert testimonyPetitioner expert creditedDecided for petitioner

    “We are also persuaded by Petitioner’s argument that a person of ordinary skill in the art would have been guided by Simon and motivated to co-locate the currency server of the APA NetCash System with Teramura’s intermediary broker to further increase the security of the combined system. In addition, we credit the testimony of Dr. Neuman, and are persuaded that a person of ordinary skill would have been motivated by the double-spending problem addressed in the APA NetCash System and Simon’s teaching of currency swapping at the middleman to recognize that, in a combined system where the currency server and the intermediary broker are co-located, the middleman is a preferred location to place the coin exchange 47 function. That is, a person of ordinary skill in the art would have found an internal coin exchange function at the middleman desirable. As discussed above, this means that an ordinary artisan would have found it desirable to have the broker check the coins received from the buyer with the co-located currency server, and, upon verification, replace them with new coins to be sent to the seller, as opposed to forwarding the coins “as-is” to the seller without checking them.” slip op. at 47

  Patent outcomesUS 8,051,011 unpatentable
  Claim construction§ 102 anticipation§ 103 obviousnesscites KSR · Graham
  Patents in suitUS 8,051,011
• Ebay, Inc. v. Paid, Inc.All claims unpatentable
  PTAB · Sep 16, 2015 · CBM2014-00128 · APJ Kristina M Kalan · CBM · Final written decision

  Claims 1–25 are unpatentable under § 101 as directed to an abstract idea and under § 103 over the asserted prior-art combinations.

  In the decision

  …construction is correct. Under the broadest reasonable interpretation standard, the “claims should always be read in light of the specification and teachings in the underlying patent.” Microsoft Corp. v. Proxyconn, Inc., 789 F.3d 1292, 1297–98 (Fed. Cir. 2015) (citation and internal quotation…

  RulingsFinal written decision

  • Claim Construction › Threshold & procedure › Whether a term needs construction (O2 Micro)Term construed petitioner constructionDecided for petitioner

    “We are not persuaded that Patent Owner’s proposed construction is correct. Under the broadest reasonable interpretation standard, the “claims should always be read in light of the specification and teachings in the underlying patent.” Microsoft Corp. v. Proxyconn, Inc., 789 F.3d 1292, 1297–98 (Fed. Cir. 2015) (citation and internal quotation marks omitted). Instead, we interpret the term “shipping rate” to mean “the overall or total cost of sending an auction item to a buyer.” This interpretation is consistent with the ’150 patent specification’s disclosure of shipping calculator system 1000 and its rate engine 1024 for calculating shipping rates based on various inputs, as illustrated in Figure 10, reproduced below. Ex. 1001, col. 6, ll. 38–42.” slip op. at 9

  • Patent Eligibility (§101) › Alice/Mayo step one — 'directed to'Step1 directed to exceptionUnpatentable

    “Despite Patent Owner’s arguments to the contrary, we see little difference between determining shipping rates and tax rates for auctioned items and the type of fundamental economic practices considered to be abstract ideas in Alice Corp. and Bilski.3 As established by the record, both 2 Bilski v. Kappos, 561 U.S. 593 (2010). 3 In Alice Corp., the Supreme Court determined that the claims at issue were “drawn to the concept of intermediated settlement,” i.e., the use of a third party to mitigate settlement risk. Id. at 2356. Furthermore, the Supreme Court determined that “[l]ike the risk hedging in Bilski, the concept of intermediated settlement is ‘a fundamental economic practice long prevalent in our system of commerce.’” Id. (citations omitted). With respect to the first step of the “Mayo framework,” the Supreme Court concluded in Alice Corp. that “there is no meaningful distinction between the concept of risk hedging in Bilski and the concept of intermediated settlement” in Alice Corp., and that “[b]oth are squarely within the realm of ‘abstract ideas’ as we have used that term.” Alice Corp., 134 S. Ct. at 2357. conventional auctions and shipping rate calculations existed long before the Internet. See, e.g., Rotman Decl. ¶¶ 4–8; Greenspun Decl. ¶¶ 31–37; Hearing Tr. 56:17–21. We conclude, therefore, that Petitioner has demonstrated that the ʼ150 patent claims, like the claims in Bilski and Alice, are directed to an abstract idea, namely, determining shipping rates for an online auction item.” slip op. at 17

  • Patent Eligibility (§101) › Alice/Mayo step two — inventive conceptStep2 no inventive conceptUnpatentable

    “We are not persuaded by Patent Owner’s argument for patentability under § 101. First, the claims of the ʼ150 patent do not reflect the asserted “inventive concept” identified by Patent Owner, namely, the ability to calculate shipping rates and tax rates in real time. Patent Owner asserts that the reference in the claims to an “online auction” accomplishes this. Hearing Tr. 62:18–20. But as Petitioner points out, the claims do not recite any form of real-time calculations. The claims simply recite steps that were routinely done manually before the filing date of the patent. Hearing Tr. 7:16–22; Rotman Dep. 127:19–128:5. More fundamentally, however, simply adding a computer limitation to claims covering an abstract concept, without more, is insufficient to render the claim patentable under § 101, even if the use of a computer enables faster operation. Bancorp Services, L.L.C. v. Sun Life Assur. Co. of Canada, 687 F.3d 1266, 1278 (Fed. Cir. 2012). In order for the addition of a machine to impose a meaningful limit on the scope of a claim, it must play a significant part in permitting the claimed method to be performed, rather than function solely as an obvious mechanism for permitting a solution to be achieved more quickly, i.e., through the utilization of a computer for performing calculations. SiRF Tech., Inc. v. Int'l Trade Comm'n, 601 F.3d 1319, 1333 (Fed. Cir. 2010). Likewise, “the use of the Internet is not sufficient to save an otherwise abstract claims from ineligibility under § 101.” Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 716 (Fed. Cir. 2014). For these reasons, Patent Owner’s argument based on meeting the asserted need for speed and other requirements of online auctions fails.” slip op. at 19

  • Obviousness (§103) › Motivation to combine / reasonable expectation of successMotivation foundReasonable expectation foundUnpatentable

    “We are persuaded by Petitioner’s arguments that it would have been obvious to combine Van Zandt and Illinois Sales Tax. Pet. 52–54. We are convinced by Petitioner’s arguments, supported by the testimony of Dr. Greenspun,5 that one of ordinary skill in the would have “readily appreciated the combinability of the sales tax calculation flow chart in Illinois Sales Tax to perform accurate tax calculations for the state of Illinois or another jurisdiction,” including the tax and duty calculations set forth in Van Zandt. Pet. 53 (citing Greenspun Decl. ¶¶ 42, 43, 63). We do not credit Patent Owner’s argument limiting Van Zandt’s teachings to international shipping. Van Zandt provides a comprehensive logistics services system and method, including providing landed cost 5 Dr. Greenspun holds a Ph.D. in Electrical Engineering and Computer Science from MIT. He has authored five computer science textbooks. He has taught at MIT and has over 20 years of experience in computer software engineering. Greenspun Decl. ¶¶ 3–16. We determine him to be an expert in the field relevant to this patent and credit his testimony. quoting (62), to integrate logistics vendors “across any industry, at any time, no matter what vendor carrier . . . or mode of transportation is to be used and no matter what country the shipment is being handled in or delivered to.” Ex. 1011, Abstract (emphasis added). More specifically, Van Zandt states that its system can calculate “any shipment duties and taxes.” Id. at 22:18 (emphasis added); see also id. at 32:11–17. Nothing in Van Zandt discredits or disallows the calculation of domestic taxes as a component of its calculation of “any shipment duties and taxes.” We credit Dr. Greenspun’s interpretation of the Van Zandt system as” slip op. at 26

  Patent outcomesUS 8,635,150 unpatentable
  Claim construction§ 101 eligibility§ 103 obviousnesscites Alice · Mayo · Bilski · KSR
  Patents in suitUS 8,635,150

Holdings, summaries, rulings, issues, outcomes, winners and claim constructions shown for a decision were generated by a large language model reading the opinion. They are a guide to the decision, not the decision. Confirm every one against the court's own text before relying on it. Outcomes read from the patent owner’s side. Party names are extracted from the decision and are missing on about 900 short Director denials and scans, which carry the trial number instead.