- Yahoo! Inc. v. Almondnet, Inc.Rehearing deniedPTAB · Feb 5, 2018 · CBM2017-00047 · APJ Michael W Kim · CBM · Rehearing
The Board denied Yahoo!’s rehearing request, leaving in place the denial of institution on the § 101 challenge to claims 1, 2-4, 11-13, 16-17, and 20-22.
RulingsRehearing decision- RehearingRehearing, deniedDenied
“requesting party believes the Board misapprehended or overlooked. 37 C.F.R. § 42.71(d). When rehearing a decision on institution, the Board will review the decision for an abuse of discretion. 37 C.F.R. § 42.71(c).” slip op. at 2
- PTAB / AIA Trials › Institution threshold (reasonable likelihood / more likely than not)Institution denied meritsInstitution denied
“matter, resolution of this issue in Petitioner’s favor is not dispositive, as Petitioner still failed to account sufficiently for the terms “offsite” and “targeted” (to say nothing of “first Internet site,” “second Internet site,” and directing off-site advertisements to visitors of the second Internet site as a consequence of determining visits to the first Internet site “using the tags and the records,” as also recited in claim 1). See Decision 11–14. Moreover, Petitioner’s assertion is incorrect, as while certainly at times, an omission of “Internet” from an identification of what a claim is directed to is proper, our review of the case law cited by Petitioner does not support a blanket assertion that the term “Internet” should never be considered in this manner, under any circumstances. See, e.g., DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245, 1256–57 (Fed. Cir. 2014) (under Alice step one, the court held that “[a]lthough the claims address a business challenge (retaining website visitors), it is a challenge particular to the Internet”). We are unpersuaded that we could have misapprehended or overlooked that which is incorrect.” slip op. at 6
- Patent Eligibility (§101) › Alice/Mayo step one — 'directed to'Step1 not directed to exceptionNot shown unpatentable
“matter, resolution of this issue in Petitioner’s favor is not dispositive, as Petitioner still failed to account sufficiently for the terms “offsite” and “targeted” (to say nothing of “first Internet site,” “second Internet site,” and directing off-site advertisements to visitors of the second Internet site as a consequence of determining visits to the first Internet site “using the tags and the records,” as also recited in claim 1). See Decision 11–14. Moreover, Petitioner’s assertion is incorrect, as while certainly at times, an omission of “Internet” from an identification of what a claim is directed to is proper, our review of the case law cited by Petitioner does not support a blanket assertion that the term “Internet” should never be considered in this manner, under any circumstances. See, e.g., DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245, 1256–57 (Fed. Cir. 2014) (under Alice step one, the court held that “[a]lthough the claims address a business challenge (retaining website visitors), it is a challenge particular to the Internet”). We are unpersuaded that we could have misapprehended or overlooked that which is incorrect.” slip op. at 6
§ 101 eligibilityPatents in suitUS 8,244,586 - Yahoo! Inc. v. Almondnet, Inc.Rehearing deniedPTAB · Feb 5, 2018 · CBM2017-00046 · APJ Michael W Kim · CBM · Rehearing
The Board denied Yahoo!’s rehearing request, leaving in place the denial of institution on the § 101 challenge to claims 1–8, 10, 13–16, 24, 27–29, 31, 32, 36, 37, 39, and 41–47.
RulingsRehearing decision- RehearingRehearing, deniedDenied
“II. ANALYSIS A request for rehearing must identify specifically all matters the requesting party believes the Board misapprehended or overlooked. 37 C.F.R. § 42.71(d). When rehearing a decision on institution, the Board will review the decision for an abuse of discretion. 37 C.F.R. § 42.71(c).” slip op. at 2
- Patent Eligibility (§101) › Alice/Mayo step one — 'directed to'Step1 not directed to exceptionNot shown unpatentable
“targeted” (to say nothing of “first Internet site,” “second Internet site,” and directing off-site advertisements to visitors of the second Internet site as a consequence of determining visits to the first Internet site “using the tags and the records,” as also recited in claim 1). See Decision 11–14. Moreover, Petitioner’s assertion is incorrect, as while certainly at times, an omission of “Internet” from an identification of what a claim is directed to is proper, our review of the case law cited by Petitioner does not support a blanket assertion that the term “Internet” should never be considered in this manner, under any circumstances. See, e.g., DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245, 1256–57 (Fed. Cir. 2014) (under Alice step one, the court held that “[a]lthough the claims address a business challenge (retaining website visitors), it is a challenge particular to the Internet”). We are unpersuaded that we could have misapprehended or overlooked that which is incorrect. slip op. at 6
§ 101 eligibilityPatents in suitUS 7,822,639 - Mitchell International, Inc. v. Audatex North America, Inc.All claims unpatentablePTAB · Feb 19, 2016 · CBM2014-00174 · APJ Lora M Green · CBM · Final written decision
Claims 1–31 are unpatentable under § 101 and anticipated by or obvious over Reimel; the motion to amend with substitute claims 32–62 is denied.
RulingsFinal written decision- Claim Construction › Intrinsic evidence (Phillips canons) › Plain and ordinary meaning to a POSITATerm construed board ownDecided for petitioner
“We have carefully considered Patent Owner’s arguments, but we do not agree that the broadest reasonable interpretation of “insurance claim,” when read in light of the Specification, is a “request to recover market value or repair cost in association with an insurance policy.” The portion of the Specification Petitioner is relying upon is only describing the state of the art at the time of invention. Moreover, it uses terms such as “may” and “typically,” and, thus, does not explicitly define “insurance claim” as Patent Owner would have us do. Thus, we see no reason to deviate from the construction of the claim term “data relating to an insurance claim for a damaged vehicle” that we adopted in the Decision on Institution; that is, as encompassing, but not being limited to, any data that would be used in making an insurance claim. Dec. 12. Moreover, even if we were to adopt Patent Owner’s more limited construction of “insurance claim,” Patent Owner does not explain how that would further limit the data that would be entered, and in fact, Patent Owner notes (PO Resp. 1) that it does not disagree with the interpretation of “data” we adopted in the Decision on Institution.” slip op. at 10
- Patent Eligibility (§101) › Alice/Mayo step one — 'directed to'Step1 directed to exceptionUnpatentable
“Here, we observe that each challenged claim is directed to the fundamental concept of providing a vehicle valuation using information about the vehicle. Patent Owner contends that, unlike the claims in Parker v. Flook, 437 U.S. 584 (1978), the claims at issue in the instant proceeding are not drawn to an algorithm. PO Resp. 12–14. When the claims are analyzed as a whole, as urged by Patent Owner (PO Resp. 10), however, the claims recite nothing more than the collection of information to generate a valuation report for a damaged vehicle. Moreover, all the steps could be performed without the use of a computer. Specifically, the steps and calculations covered by the claims essentially require determining the value of a damaged vehicle by entering data related to an insurance claim, such as mileage and vehicle condition, and processing the data to generate a valuation report for the damaged vehicle; a calculation that can be performed by the human mind, or with the aid of pencil and paper. See, e.g., Mortgage Grader, Inc. v. First Choice Loan Servs. Inc., No. 2015-1415, 2016 WL 362415, at *7 (Fed. Cir. Jan. 20, 2016) (noting that the steps of the claims could be performed by a human without the use of a computer in concluding that the claims at issue were drawn to an abstract idea). The fact that the claims at issue are not per se drawn to an algorithm does not insulate them from being found an abstract idea. The claims in Alice were drawn to “a computer-implemented scheme for mitigating ‘settlement risk’ . . . by using a third-party intermediary.” Alice, 134 S. Ct. at 2351–52. The claims at issue in Mortgage Grader were drawn to a computer-implemented system that allowed borrowers to shop anonymously for loan packages from a plurality of lenders. Mortgage Grader, 2016 WL 362415, at *1. Thus, the fact that the claims in those cases were not specifically drawn to an algorithm did not prevent them from being drawn to an abstract idea. We are persuaded that, similar to the concept of intermediated settlement in Alice, the concept of risk hedging in Bilski, and the concept of shopping anonymously for loan packages in Mortgage Grader¸ the concept at issue here—obtaining a vehicle valuation report for a damaged vehicle— is “a fundamental economic practice long prevalent in our system of commerce,” and “squarely within the realm of ‘abstract ideas.’” Alice, 134 S. Ct. at 2356–57; Bilski, 130 S. Ct. 3231. Accordingly, we determine that Petitioner has demonstrated that the challenged claims are directed to a patent-ineligible abstract idea.” slip op. at 16
- Patent Eligibility (§101) › Alice/Mayo step two — inventive conceptStep2 no inventive conceptUnpatentable
- Novelty / Anticipation (§102) › Anticipation standard (single reference, every element)UnpatentableUnpatentable
Patent outcomesUS 8,200,513 unpatentableClaim construction§ 101 eligibility§ 102 anticipation§ 103 obviousnesscites Alice · Mayo · Phillips · KSR · GrahamPatents in suitUS 8,200,513 - Mitchell International, Inc. v. Audatex North America, Inc.All claims unpatentablePTAB · Feb 19, 2016 · CBM2014-00173 · APJ Lora M Green · CBM · Final written decision
Claims 1–31 are unpatentable under § 101 and §§ 102(b)/103(a) over Reimel; the motion to amend with substitute claims 32–62 is denied.
RulingsFinal written decision- Claim Construction › Intrinsic evidence (Phillips canons) › Plain and ordinary meaning to a POSITATerm construed board ownDecided for petitioner
“not agree that the broadest reasonable interpretation of “insurance claim,” when read in light of the Specification, is a “request to recover market value or repair cost in association with an insurance policy.” The portion of the Specification Petitioner is relying upon is only describing the state of the art at the time of invention. Moreover, it uses terms such as “may” and “typically,” and, thus, does not explicitly define “insurance claim” as Patent Owner would have us do. Thus, we see no reason to deviate from the construction of the claim term “data relating to an insurance claim for a damaged vehicle” that we adopted in the Decision on Institution; that is, as encompassing, but not being limited to, any data that would be used in making an insurance claim, so long as the data includes a vehicle year, model, and geographic location. Dec. 12–13. Moreover, even if we were to adopt Patent Owner’s more limited construction of “insurance claim,” Patent Owner does not explain how that would further limit the data that would be entered, and in fact, Patent Owner notes (PO Resp. 1) that it does not disagree with the interpretation of “data” we adopted in the Decision on Institution.” slip op. at 11
- Claim Construction › Threshold & procedure › Whether a term needs construction (O2 Micro)No construction neededOther
“3. Other Claim Terms We determine that we need not interpret expressly other claim limitations for purposes of this decision. See, e.g., Wellman, Inc. v. Eastman Chem. Co., 642 F.3d 1355, 1361 (Fed. Cir. 2011) (“[C]laim terms need only be construed ‘to the extent necessary to resolve the controversy.’”) (internal citations omitted).” slip op. at 14
- Patent Eligibility (§101) › Alice/Mayo step one — 'directed to'Step1 directed to exceptionUnpatentable
“Here, we observe that each challenged claim is directed to the fundamental concept of providing a vehicle valuation using information about the vehicle. Patent Owner contends that, unlike the claims in Parker v. Flook, 437 U.S. 584 (1978), the claims at issue in the instant proceeding are not drawn to an algorithm. PO Resp. 12–14. When the claims are analyzed as a whole, as urged by Patent Owner (id. at 10), however, the claims recite nothing more than the collection of information to generate a valuation report for a damaged vehicle. Moreover, all the steps could be performed without the use of a computer. Specifically, the steps and calculations covered by the claims essentially require determining the value of a damaged vehicle by entering data related to an insurance claim, such as mileage and vehicle condition, and processing the data to generate a valuation report for the damaged vehicle; a calculation that can be performed by the human mind, or with the aid of pencil and paper. See, e.g., Mortgage Grader, Inc. v. First Choice Loan Servs. Inc., No. 2015-1415, 2016 WL 362415, at *7 (Fed. Cir. Jan. 20, 2016) (noting that the steps of the claims could be performed by a human without the use of a computer in concluding that the claims at issue were drawn to an abstract idea). The fact that the claims at issue are not per se drawn to an algorithm does not insulate them from being found an abstract idea. The claims in Alice were drawn to “a computer-implemented scheme for mitigating ‘settlement risk’ . . . by using a third-party intermediary.” Alice, 134 S. Ct. at 2351–52. The claims at issue in Mortgage Grader were drawn to a computer-implemented system that allowed borrowers to shop anonymously for loan packages from a plurality of lenders. Mortgage Grader, 2016 WL 362415, at *1. Thus, the fact that the claims in those cases were not specifically drawn to an algorithm did not prevent them from being drawn to an abstract idea. We are persuaded that, similar to the concept of intermediated settlement in Alice, the concept of risk hedging in Bilski, and the concept of shopping anonymously for loan packages in Mortgage Grader, the concept at issue here—obtaining a vehicle valuation report for a damaged vehicle— is “a fundamental economic practice long prevalent in our system of commerce,” and “squarely within the realm of ‘abstract ideas.’” Alice, 134 S. Ct. at 2356–57; Bilski, 130 S. Ct. 3231. Accordingly, we determine that Petitioner has demonstrated that the challenged claims are directed to a patent-ineligible abstract idea.” slip op. at 17
- Patent Eligibility (§101) › Alice/Mayo step two — inventive conceptStep2 no inventive conceptUnpatentable
“We agree with Petitioner’s analysis that the claims do not add additional substantive limitations that transform their nature into a patent-eligible application of an abstract idea. The only technological features recited in the claims at issue in this proceeding are generic computer implementation systems performing generic computer functions. As acknowledged by Patent Owner’s expert, the claims do not improve the function of the computer, they do not solve a problem unique to the internet, nor are they tied to a particular machine or apparatus. Ex. 1015, 223:4–20; 231:9–232:1. Simply utilizing a generic computer system to generate a vehicle valuation report is not enough to transform a patent-ineligible claim into a patent-eligible invention. See Bancorp Servs. LLC v. Sun Life Assurance Co. of Canada, 687 F.3d 1266, 1279 (Fed. Cir. 2012) (finding a claim not patent-eligible when “the computer simply performs more efficiently what could otherwise be accomplished manually”); SiRF Tech., Inc. v. Int’l Trade Comm’n, 601 F.3d 1319, 1333 (Fed. Cir. 2010) (“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.”). Nearly every computer has the capability of performing basic calculation, storage, and transmission functions. See Alice, 134 S. Ct. at 2360. At most, the computer implementation involved in the claims at issue here is an attempt to limit use of the abstract concept to a particular technological environment. Claims that simply instruct the practitioner to implement the abstract idea with routine, conventional activity do not transform an abstract idea into patent eligible subject matter. Ultramercial, 772 F.3d at 716. The claims simply instruct the practitioner to use the internet to obtain a vehicle valuation, without reciting further unconventional features of that system.” slip op. at 20
Patent outcomesUS 8,468,038 unpatentableClaim construction§ 101 eligibility§ 102 anticipation§ 103 obviousnesscites Alice · Mayo · Phillips · KSR · GrahamPatents in suitUS 8,468,038 - Mitchell International, Inc. v. Audatex North America, Inc.All claims unpatentablePTAB · Feb 19, 2016 · CBM2014-00171 · APJ Lora M Green · CBM · Final written decision
Claims 1–29 are unpatentable under § 101 and anticipated or obvious over Reimel; the motion to amend with substitute claims 30–58 is denied.
RulingsFinal written decision- Patent Eligibility (§101) › Alice/Mayo step one — 'directed to'Step1 directed to exceptionUnpatentable
“Here, we observe that each challenged claim is directed to the fundamental concept of providing a vehicle valuation using information about the vehicle. Patent Owner contends that, unlike the claims in Parker v. Flook, 437 U.S. 584 (1978), the claims at issue in the instant proceeding are not drawn to an algorithm. PO Resp. 13–14. When the claims are analyzed as a whole, as urged by Patent Owner (id. at 10), however, the claims recite nothing more than the collection of information to generate a valuation report for a damaged vehicle. Moreover, all the steps could be performed without the use of a computer. Specifically, the steps and calculations covered by the claims essentially require determining the value of a damaged vehicle by entering data related to an insurance claim, such as mileage and vehicle condition, and processing the data to generate a valuation report for the damaged vehicle; a calculation that can be performed by the human mind, or with the aid of pencil and paper. See, e.g., Mortgage Grader, Inc. v. First Choice Loan Servs. Inc., No. 2015-1415, 2016 WL 362415, at *7 (Fed. Cir. Jan. 20, 2016) (noting that the steps of the claims could be performed by a human without the use of a computer in concluding that the claims at issue were drawn to an abstract idea). The fact that the claims at issue are not per se drawn to an algorithm does not insulate them from being found an abstract idea. The claims in Alice were drawn to “a computer-implemented scheme for mitigating ‘settlement risk’ . . . by using a third-party intermediary.” Alice, 134 S. Ct. at 2351–52. The claims at issue in Mortgage Grader were drawn to a computer-implemented system that allowed borrowers to shop anonymously for loan packages from a plurality of lenders. Mortgage Grader, 2016 WL 362415, at *1. Thus, the fact that the claims in those cases were not specifically drawn to an algorithm did not prevent them from being drawn to an abstract idea. We are persuaded that, similar to the concept of intermediated settlement in Alice, the concept of risk hedging in Bilski, and the concept of shopping anonymously for loan packages in Mortgage Grader, the concept at issue here—obtaining a vehicle valuation report for a damaged vehicle— is “a fundamental economic practice long prevalent in our system of commerce,” and “squarely within the realm of ‘abstract ideas.’” Alice, 134 S. Ct. at 2356–57; Bilski, 130 S. Ct. 3231. Accordingly, we determine that Petitioner has demonstrated that the challenged claims are directed to a patent-ineligible abstract idea.” slip op. at 17
- Patent Eligibility (§101) › Alice/Mayo step two — inventive conceptStep2 no inventive conceptUnpatentable
“We agree with Petitioner’s analysis that the claims do not add additional substantive limitations that transform their nature into a patent-eligible application of an abstract idea. The only technological features recited in the claims at issue in this proceeding are generic computer implementation systems performing generic computer functions. As acknowledged by Patent Owner’s expert, the claims do not improve the function of the computer, they do not solve a problem unique to the internet, nor are they tied to a particular machine or apparatus. Ex. 1015, 223:4–20; 231:9–232:1. Simply utilizing a generic computer system to generate a vehicle valuation report is not enough to transform a patent-ineligible claim into a patent-eligible invention. See Bancorp Servs. LLC v. Sun Life Assurance Co. of Canada, 687 F.3d 1266, 1279 (Fed. Cir. 2012) (finding a claim not patent-eligible when “the computer simply performs more efficiently what could otherwise be accomplished manually”); SiRF Tech., Inc. v. Int’l Trade Comm’n, 601 F.3d 1319, 1333 (Fed. Cir. 2010) (“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”). Nearly every computer has the capability of performing basic calculation, storage, and transmission functions. See Alice, 134 S. Ct. at 2360. At most, the computer implementation involved in the claims at issue here is an attempt to limit use of the abstract concept to a particular technological environment. Claims that simply instruct the practitioner to implement the abstract idea with routine, conventional activity do not transform an abstract idea into patent eligible subject matter. Ultramercial, 772 F.3d at 716. The claims simply instruct the practitioner to use the internet to obtain a vehicle valuation, without reciting further unconventional features of that system.” slip op. at 20
- Claim Construction › Intrinsic evidence (Phillips canons) › Plain and ordinary meaning to a POSITATerm construed board ownDecided for petitioner
“We have carefully considered Patent Owner’s arguments, but we do not agree that the broadest reasonable interpretation of “insurance claim,” when read in light of the Specification, is a “request to recover market value or repair cost in association with an insurance policy.” The portion of the Specification Petitioner is relying upon is only describing the state of the art at the time of invention. Moreover, it uses terms such as “may” and “typically,” and, thus, does not explicitly define “insurance claim” as Patent Owner would have us do. Thus, we see no reason to deviate from the construction of the claim term “data relating to an insurance claim for a damaged vehicle” that we adopted in the Decision on Institution; that is, as encompassing, but not being limited to, any data that would be used in making an insurance claim. Dec. 12–13. Moreover, even if we were to adopt Patent Owner’s more limited construction of “insurance claim,” Patent Owner does not explain how that would further limit the data that would be entered, and in fact, Patent Owner notes (PO Resp. 1) that it does not disagree with the interpretation of “data” we adopted in the Decision on Institution.” slip op. at 11
- Novelty / Anticipation (§102) › Anticipation standard (single reference, every element)UnpatentableUnpatentable
“As to the anticipation challenge, Patent Owner contends that, if the claim term “valuation report for the damaged vehicle” is construed as “a report that provides a value of the vehicle that was damaged, before the vehicle was damaged, based on factors including mileage, condition, and geographic location,” Reimel cannot anticipate the challenged claims. PO Resp. 7–8. In particular, Patent Owner argues that “Reimel does not explicitly, or inherently, disclose providing a market value for a damaged vehicle before the vehicle was damaged.” Id. That argument is not convincing, because as discussed above, we decline to construe the claim term “valuation report for the damaged vehicle” as “a report that provides a value of the vehicle that was damaged, before the vehicle was damaged, based on factors including mileage, condition, and geographic location.” Thus, Reimel anticipates the challenged claims to the extent they are construed as providing a valuation report for a damaged vehicle for the value of the vehicle after the damage was sustained. Patent Owner contends further that “Reimel does not disclose providing web pages that allow for entry of data related to an insurance claim that request recover[y] of the market value of the vehicle cost or repair cost as required by the claims.” Id. at 7. According to Patent Owner, the only portion of Reimel that relates to use by an insurance company is the following: Insurance companies may use the present invention to evaluate crashed vehicles as well as the damage to stolen vehicles. The present invention will provide a neutral objective standard for assessment of such vehicles by insurance adjusters. Id. (quoting Ex. 1010, 10:13–15). According to Patent Owner, that passage “lacks any disclosure, explicit or inherent, regarding a web page that relates to an insurance claim to request a recovery of market value or repair cost of a damaged vehicle.” Id. (citing Ex. 2006 ¶ 39). That argument by Patent Owner is again not convincing. Claim 1 requires the step of “entering data relating to the insurance claim.” Similarly, the system of claim 10, the server of claim 18, and the computer program storage medium of claim 24 require “web pages [that] allow for receipt of data relating to an insurance claim.” As construed above, data relating to an insurance claim encompasses any data that would be used in making an insurance claim, which encompasses the various characteristics of the vehicle to be valued disclosed by Reimel. We reiterate that there is nothing in the Specification of the ’740 patent that limits the claimed method, system, server, or computer program storage medium to determining a pre-damaged valuation of the vehicle. That is, determining the value of a damaged vehicle as required by the independent claims, as construed above, encompasses determining the value of the vehicle in either” slip op. at 27
Patent outcomesUS 7,912,740 unpatentableClaim construction§ 101 eligibility§ 102 anticipation§ 103 obviousnesscites Alice · Mayo · Phillips · KSR · GrahamPatents in suitUS 7,912,740 - Ebay, Inc. v. Paid, Inc.All claims unpatentablePTAB · 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.
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 unpatentableClaim construction§ 101 eligibility§ 103 obviousnesscites Alice · Mayo · Bilski · KSRPatents in suitUS 8,635,150 - Ebay, Inc. v. Paid, Inc.All claims unpatentablePTAB · Sep 16, 2015 · CBM2014-00127 · APJ James P Calve · CBM · Final written decision
Claims 1–19 are unpatentable under § 101 as directed to an abstract idea without an inventive concept, and under the asserted § 103 grounds.
RulingsFinal written decision- Claim Construction › Threshold & procedure › Whether a term needs construction (O2 Micro)Term construed board ownDecided for petitioner
“Under the broadest reasonable interpretation standard, the “claims should always be read in light of the specification and the teachings of the underlying patent.” Microsoft Corp. v. Proxyconn, Inc., 789 F.3d 1292, 1297–98 (Fed. Cir. 2015). 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 ’237 patent specification’s disclosure of shipping calculator system 1000 and its rate engine 1024 for calculating shipping rates as shown in Figure 10, reproduced below. Ex. 1001, 6:29–33. Figure 10 shows a computer-based system with a shipping calculator. The ’237 patent discloses that rate engine 1024 includes modules that calculate factors contributing to the “overall shipping rate” like shipping rate engine 1028, tax rate engine 1030, insurance rate engine 1032, packaging algorithm engine 1033, and fee-based rate engine 1034. Id. at 7:36–41. Shipping rate engine 1028 calculates a basic shipping rate for an item based on the distance between seller and buyer locations, the weight of the item, the weight of any packaging, and method of shipment. Id. at 8:25–33. Tax rate engine 1030 determines applicable taxes. Id. at 8:34–35. Insurance rate engine 1032 calculates a cost of insurance that is added to the shipping rate based on buyer and seller preferences. Id. at 8:42–46. Because packaging is an important factor in shipping cost, packaging algorithm engine 1033 determines the packaging based on seller preferences and the size, weight, or shape of the item and applies a factor to the shipping rate. Id. at 7:55–8:5. Fee-based engine 1034 calculates rates based on seller inputs such as rates charged for shipping and handling above the rates from common carriers and may include a flat rate for shipping, or per item shipped. Id. at 8:6–20. Rate engine 1024 integrates inputs from the calculations of these other modules and engines, and applies whatever discounts or other factors are required if the components are not simply added, “to obtain a shipping rate based on the various inputs.” Id. at 8:47–51 (emphasis added). The ’237 patent also discloses that the shipping rate may be a flat rate from fee-based engine 1034, a rate calculated from the other engines, or a rate from a combination of different types of calculations. Id. at 8:51–54. Thus, the ’237 patent discloses rate engine 1000 calculating a “shipping rate” that includes not only a basic transportation cost but also many other costs that contribute to the total cost to send an item to a buyer.” slip op. at 9
- Patent Eligibility (§101) › Alice/Mayo step one — 'directed to'Step1 directed to exceptionIneligibleUnpatentable
“We are not persuaded by Patent Owner’s argument that the ʼ237 patent does not claim an abstract idea merely because it is directed to online auctions. PO Resp. 23; Hearing Tr. 56:10–12. As the Federal Circuit recently reminded us, “[a]n abstract idea does not become nonabstract by limiting the invention to a particular field of use or technological environment such as the Internet.” Intellectual Ventures I LLC v. Capital One Bank (US), 792 F.3d 1363, 1366 (Fed. Cir. 2015) (citations omitted). We are, therefore, not convinced by Patent Owner’s argument that the claims are not abstract because they are limited to a specific application. Patent Owner further contends that, unlike the claims in Bilski3 and Alice, the ʼ237 patent’s claims “had never before been achieved.” PO Resp. 23–24. As evidence of this, Patent Owner points to the fact that Petitioner’s prior art challenge relies on obviousness and not anticipation. Id. at 24, n.2 (“eBay has not been able to find or assert against the claims a single anticipatory reference.”). This argument is unavailing. As the Supreme Court observed in Diamond v. Diehr, 450 U.S. 175, 190 (1981), “[t]he 3 Bilski v. Kappos, 561 U.S. 593 (2010). question therefore of whether a particular invention is novel is wholly apart from whether the invention falls into a category of statutory subject matter.” 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.4 As established by the record, both conventional auctions and shipping rate calculations existed long before the Internet. See, e.g., Rotman Decl. ¶¶ 4–8; Greenspun Decl. ¶¶ 31–40; Hearing Tr. 56:17–21. We conclude, therefore, that Petitioner has demonstrated that the ʼ237 patent claims, like the claims in Bilski and Alice, are directed to an abstract idea, namely, determining shipping rates for online auction sales.” slip op. at 16
- Patent Eligibility (§101) › Alice/Mayo step two — inventive conceptStep2 no inventive conceptIneligibleUnpatentable
“We are not persuaded by Patent Owner’s argument for patentability under § 101. First, the claims of the ʼ237 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 done manually before the filing date of the patent. Hearing Tr. 7:16–22; Rotman Dep. 127:19–128:5; Rotman Decl. ¶¶ 21–25, 46. The claims of the ʼ237 patent specify that a shipping rate be calculated “at any time.” Patent Owner relies on this as evidence that the claims embody the asserted inventive concept of providing speedy shipping rate calculations. Hearing Tr. 69:9–22. We are not convinced by this argument. As Patent Owner’s counsel agreed, the language does not indicate how long the calculation takes, only when it may occur. Id. at 70:20–71:5. 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.” slip op. at 19
- Obviousness (§103) › Motivation to combine / reasonable expectation of successMotivation foundReasonable expectation foundDecided for petitioner
“First, we are persuaded by Petitioner’s arguments, as supported by Dr. Greenspun’s6 testimony, that it would have been obvious to modify Van Zandt according to techniques of iShip.com because both references address the provision of a shipping rate calculator for online auctions so buyers can obtain a shipping estimate at any point during an online auction. Pet. 29–31. We are persuaded by Petitioner’s arguments and Dr. Greenspun’s testimony that a skilled artisan would have been motivated to embed a link to shipping 6 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 that Dr. Greenspun is an expert in the field relevant to this patent and credit his testimony. information in Van Zandt’s interfaces, as taught by iShip.com’s unique URL that a seller pastes into item descriptions, to increase Van Zandt’s flexibility and provide multiple shipping options. Pet. 29–31; Pet. Reply 5; Greenspun Decl. ¶ 56 (iShip.com allows seller to add a form to another’s web site); Ex. 1020 ¶ 10c (user interfaces are freely borrowed from different websites).” slip op. at 25
Patent outcomesUS 7,930,237 unpatentableClaim construction§ 101 eligibility§ 103 obviousnesscites Alice · Bilski · KSR · GrahamPatents in suitUS 7,930,237 - Bank Of America, N.A. / PNC Financial Services Group, Inc. et al. v. Intellectual Ventures I LLCRehearing deniedPTAB · Jun 25, 2015 · CBM2014-00030 · APJ Thomas L Giannetti · CBM · Rehearing
The Board denied Patent Owner’s rehearing request, leaving claims 1–23 unpatentable under § 101 because no matter was overlooked or misapprehended and the Board did not abuse its discretion.
RulingsRehearing decision- RehearingRehearing, deniedDenied
“A party dissatisfied with a decision may file a request for rehearing, without prior authorization from the Board. The burden of showing a decision should be modified lies with the party challenging the decision. The request must specifically identify all matters the party believes the Board misapprehended or overlooked, and the place where each matter was previously addressed in a motion, opposition, or a reply. In Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 134 S. Ct. 2347, 2355” slip op. at 3
- Expert testimonyPetitioner expert creditedPatent owner expert discountedDecided for petitioner
“Patent Owner’s expert does not rebut convincingly Dr. Myers’s claim-by-claim analysis. Instead, Patent Owner’s expert addresses the claims in two groups only. Ex. 2003, ¶¶ 26–28. We find this approach unconvincing, and therefore, credit Dr. Myers’s testimony as to specific claims over the testimony of Patent Owner’s expert.” slip op. at 8
- Patent Eligibility (§101) › Alice/Mayo step one — 'directed to'Step1 directed to exceptionUnpatentable
“Decision. The first statement, regarding “abstract level,” was cited twice in the Final Decision. In the first instance, the citation followed a discussion of the first element of the Alice test. Final Dec. 9. Patent Owner’s main argument was that the ʼ382 patent did not fall within the categories of unpatentable, abstract ideas enumerated in Alice. Without reference to Mr. Martin’s testimony, the Board agreed with Petitioners that these enumerated categories are not exclusive. Id. The Board went on to state in a sentence that they were “influenced” by Mr. Martin’s testimony, which is then quoted in full, in determining that the patent is directed to an abstract idea. But the Board also had before it Dr. Myers’ testimony to the same effect. Myers Decl. ¶¶ 24–27. The second citation of this statement by Mr. Martin, also in a single sentence,1 follows a lengthy discussion of the patent claims based on the oral argument and Dr. Myers’ analysis. Final Dec. 11–14.” slip op. at 6
- Patent Eligibility (§101) › Alice/Mayo step two — inventive conceptStep2 no inventive conceptUnpatentable
“[Patent Owner’s] supposed “inventive concept”—“delivering tailored web pages through an interactive interface as a function of web site navigation history”—fails to meet this standard. It is merely a restatement of the ’382 patent’s abstract idea (i.e., “tailoring an information provider’s web pages based on data about a particular information user”). This “concept” fails to include how to tailor web pages or use the web site navigation data. It therefore cannot “ensure that the patent in practice amounts to significantly more than a patent upon the ineligible concept itself,” as required by Alice Corp. Pet. Reply 5–6 (footnote omitted). Nor are we persuaded that the argument was overlooked or misapprehended by the Board. The Board considered all arguments presented. The Board was not persuaded by Patent Owner’s argument on this issue. In fact, this argument was rejected by the Federal Circuit in Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 714 (Fed. Cir. 2014). The patent owner there argued “abstract ideas remain patent-eligible under §101 as long as they are new ideas, not previously well known, and not routine activity.” Ultramercial, 772 F.3d at 714. The Federal Circuit rejected this argument, concluding “[w]e agree with [defendant] that the claims of the ʼ545 patent are not directed to patent-eligible subject matter.” Id. Petitioners cite this very holding of Ultramercial in their response to Patent Owner’s “inventive concept” argument. Pet. Reply 5, n.1. We, therefore, did not overlook or misapprehend the “inventive concept” argument put forth by Patent Owner. We simply found Petitioners’ argument more persuasive under the prevailing legal authorities, including Ultramercial.” slip op. at 4
§ 101 eligibilitycites AlicePatents in suitUS 7,603,382
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