• Ibg LLC / Interactive Brokers LLC et al. v. Trading Technologies International, Inc.All claims unpatentable
  PTAB · Oct 17, 2017 · CBM2016-00054 · APJ Meredith C Petravick · CBM · Final written decision

  Claims 1–23 are unpatentable under § 101 and § 103; the Board found the claims patent-ineligible and found the challenged obviousness grounds established.

  In the decision

  …all of the above reasons, we determine that TSE qualifies as prior art. 3. Claims 1 and 23 With respect to claims 1 and 23, Petitioner cites TSE as teaching the majority of limitations of the claims. Pet. 31–53. Petitioner cites Belden for the “single action” limitation in the claims, including…

  RulingsFinal written decision

  • ExcludeMotion to exclude, deniedDenied

    “Patent Owner’s argument is not persuasive. FRE 106 provides that: If a party introduces all or part of a writing or recorded statement, an adverse party may require the introduction, at that time, of any other part —or any other writing or recorded statement — that in fairness ought to be considered at the same time. As Petitioner points out, “rather than providing a basis for excluding evidence, Fed. R. Evid. 106 is a vehicle for entry of additional evidence.” Here, the two translator’s notes from Patent Owner’s original translation already appear in the record. Ex. 2178, 39–40. FRE 403 provides: The court may exclude relevant evidence if its probative value is substantially outweighed by a danger of one or more of the following: unfair prejudice, confusing the issues, misleading the jury, undue delay, wasting time, or needlessly presenting cumulative evidence. Patent Owner has not met its burden to show Exhibit 1017 should be” slip op. at 75

  • Skill levelOther
  • Expert testimonyPetitioner expert discountedPatent owner expert discountedDecided for patent owner

    “We have considered the evidence to which we are directed, but do not find that evidence (passages from Mr. Kawashima’s original and cross examination) to support Patent Owner’s assertions that Mr. Kawashima is biased. Indeed, when asked if the Tokyo Stock Exchange preferred that vendors like Trading Technologies not have patents on trading screens, Mr. Kawashima testified, that that was “not something I would know.” Ex. 2163, 41:6–12. Lastly, Patent Owner has not demonstrated sufficiently that Mr. Kawashima’s meetings with Petitioner’s attorneys prior to his cross examination is demonstrative of “bias.” PO Resp. 24. Patent Owner has not shown why Mr. Kawashima’s meeting with Petitioner’s counsel prior to his deposition would make him biased. For these reasons, we are not persuaded that Mr. Kawashima is an interested witness.” slip op. at 45

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

    “2. Abstract Idea “The ‘abstract idea’ step of the inquiry calls upon us to look at the” slip op. at 27

  Patent outcomesUS 7,693,768 unpatentable
  § 101 eligibility§ 103 obviousnesscites Mayo · Enfish · Electric Power · KSR
  Patents in suitUS 7,693,768
• Nautilus Hyosung Inc. v. Diebold Nixdorf, Inc.All claims unpatentable
  PTAB · Aug 14, 2017 · CBM2016-00034 · APJ Barbara A Benoit · CBM · Final written decision

  Claims 1–24 are unpatentable under § 101; claims 1–3 and 5 are also anticipated by Riach, and specified claims are obvious over combinations of Riach, Graf, Gustin, and Anderson.

  In the decision

  …Corp. v. Cleveland Golf Co., 242 F.3d 1376, 1383 (Fed. Cir. 2001). To anticipate, a prior art reference must disclose more than “multiple, distinct teachings that the artisan might somehow combine to achieve the claimed invention.” Net MoneyIN, 545 F.3d at 1371. Although the elements must be…

  RulingsFinal written decision

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

    “For these reasons, we determine that claim 20—its focus and its” slip op. at 37

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

    “For the foregoing reasons, we conclude that claim 20 is directed to an” slip op. at 52

  • Novelty / Anticipation (§102) › Anticipation standard (single reference, every element)UnpatentableUnpatentable

    “encompasses Riach’s process that copies a portion (but not all) of the original check image data to produce the required modified check image data. Accordingly, we agree that the portion of Riach on which Petitioner relies discloses step (b) of claim 1 that requires, among other limitations, the modified check image data not include at least some visual feature data included in the check image data. Pet. 30 (relying on Ex. 1008, 5:16–30, Figs. 4, 7).” slip op. at 73

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

    “several elements is not proved obvious merely by demonstrating that each of its elements was, independently, known in the prior art.” KSR, 550 U.S. at 418. Rather, “it can be important to identify a reason that would have prompted a person of ordinary skill in the relevant field to combine the elements in the way the claimed new invention does.” Apple, 839 F.3d at 1058 (quoting KSR, 550 U.S. at 418–19); see also KSR, 550 U.S. at 418 (“[T]here must be some articulated reasoning with some rational underpinning to support the legal conclusion of obviousness.”) (quoting In re Kahn, 441 F.3d 977, 988 (Fed. Cir. 2006)).” slip op. at 89

  Patent outcomesUS 7,314,163 unpatentable
  § 101 eligibility§ 102 anticipation§ 103 obviousnesscites Alice · Mayo · Bilski · Enfish · Electric Power · Phillips · Graham
  Patents in suitUS 7,314,163
• Ibg LLC / Interactive Brokers LLC et al. v. Trading Technologies International, Inc.All claims unpatentable
  PTAB · Mar 3, 2017 · CBM2015-00181 · APJ Meredith C Petravick · CBM · Final written decision

  Claims 1–28 are patent-ineligible under § 101 and unpatentable under § 103 over TSE, Belden, and Togher.

  In the decision

  …we determine that TSE qualifies as prior art. 2. TSE, Belden, and Togher a. Claims 1 and 26 With respect to claims 1 and 26, Petitioner cites TSE as teaching the majority of limitations of the claims. Pet. 64–69. Petitioner cites Belden for the “single action” limitation in the claims, including…

  RulingsFinal written decision

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

    “3. Abstract Idea “The ‘abstract idea’ step of the inquiry calls upon us to look at the ‘focus of the claimed advance over the prior art’ to determine if the claim’s ‘character as a whole’ is directed to excluded subject matter.” Affinity Labs of Texas v. DirectTV, LLC, 838 F.3d 1253, 1257 (Fed. Cir. 2016) (quoting Elec. Power Grp., LLC v. Alstom S.A., 830 F.3d 1350, 1353 (Fed. Cir. 2016); see also Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1335 (Fed. Cir. 2016). According to Petitioner, the claims are directed to the abstract idea of” slip op. at 23

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

    “4. Inventive Concept To be patent eligible, a claim directed to an abstract idea must recite additional elements that constitute an inventive concept. Alice, 134 S. Ct. at 2357. One looks to “[t]he elements of each claim both individually and ‘as an ordered combination’ to determine whether the additional elements ‘transform the nature of the claim’ into a patent-eligible application.” Id. at 2355 (quoting Mayo, 132 S. Ct. at 1297–98). The additional elements must be more than “well-understood, routine, conventional, activity.” Mayo, 132 S. Ct. at 1298. Petitioner contends that claim 1 does not recite an inventive concept.” slip op. at 30

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

    “1. TSE Printed Publication Status Petitioner argues that TSE is prior art under 35 U.S.C. § 102(a). Pet. 11. In support of its showing that TSE qualifies as prior art, Petitioner relies on the November 21, 2005, deposition testimony of Atsushi Kawashima taken during litigation between Patent Owner and a third party, eSpeed, Inc. Id.; Ex. 1010. Whether a document qualifies as a printed publication under 35 U.S.C. § 102(a) 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).” slip op. at 34

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

    “2. TSE, Belden, and Togher a. Claims 1 and 26 With respect to claims 1 and 26, Petitioner cites TSE as teaching the majority of limitations of the claims. Pet. 64–69. Petitioner cites Belden for the “single action” limitation in the claims, including the “setting” and “sending” via the “single action,” and cites Togher as teaching an order being for a “default quantity.” Id. at 69–73. Petitioner proposes modifying TSE based on the teachings of Belden and Togher. Id. at 62–64. TSE describes a trading system that facilitates trading with an electronic exchange by receiving bid and offer information, displaying it to a user, and accepting and sending bid and offer orders. Ex. 1007, 6–13, 35. A trading terminal displays a GUI for depicting market information on a Board Screen, which is shown in the figure reproduced below (“TSE’s Board Screen”).” slip op. at 43

  Patent outcomesUS 7,676,411 unpatentable
  § 101 eligibility§ 102 anticipation§ 103 obviousnesscites Alice · Mayo · Enfish · Electric Power
  Patents in suitUS 7,676,411
• 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
• 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

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.