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`UNITED STATES PATENT AND TRADEMARK OFFICE
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`—————————————
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`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`
`—————————————
`
`
`LIBERTY MUTUAL INSURANCE CO.
`Petitioner
`
`v.
`
`PROGRESSIVE CASUALTY INSURANCE CO.
`Patent Owner
`
`
`—————————————
`
`
`Case CBM2012-00002
`Patent 6,064,970
`
`
`—————————————
`
`
`PATENT OWNER’S PRELIMINARY RESPONSE
`PURSUANT TO 37 C.F.R. § 42.207
`
`
`
`

`

`
`
`TABLE OF CONTENTS
`
`
`
`2. 
`
`B. 
`
`C. 
`
`D. 
`E. 
`
`Introduction ..................................................................................................... 1 
`I. 
`Background Information/Claim Construction ................................................ 9 
`II. 
`III.  The Petition Relies on Art that is Not New and Missing Key
`Limitations, Thereby Failing to Satisfy the Elevated Threshold
`Standard Requiring a Showing that it is More Likely Than Not that
`the Challenged Claim will be Found Invalid. ............................................... 10 
`Contrary to the Express Intent of 35 U.S.C. § 325(d), the Cited
`A. 
`References are the Same or Substantially the Same as the
`References in the Reexamination ....................................................... 11 
`Claim 1 is Not Rendered Obvious by Kosaka in View of Black
`Magic and Herrod (Alleged Ground 1-1) ........................................... 16 
`Kosaka and Herrod Cannot be Combined in View of
`1. 
`Fundamental Differences in Their Disclosures ....................... 17 
`The Combination of Kosaka and Herrod Does Not
`Disclose the Claimed Invention ............................................... 22 
`Claim 1 is Not Rendered Obvious by Kosaka in View of Black
`Magic and New York Guide (Alleged Ground 1-2) .......................... 31 
`Claim 4 is Not Anticipated by Kosaka (Alleged Ground 4-1) ........... 33 
`Claim 4 is Not Rendered Obvious by Kosaka in View of
`Florida Guide (Alleged Ground 4-2) .................................................. 38 
`Claim 4 is Not Rendered Obvious by Kosaka in View of New
`York Guide (Alleged Ground 4-3) ..................................................... 40 
`Claim 5 is Not Anticipated by Kosaka (Alleged Ground 5-1) ........... 42 
`Claim 5 is Not Rendered Obvious by Kosaka in View of
`Florida Guide (Alleged Ground 5-2) or Rendered Obvious by
`Kosaka in View of New York Guide (Alleged Ground 5-3) ............. 43 
`Claims 6 and 18 are Not Rendered Obvious by Kosaka in View
`of Herrod (Alleged Grounds 6-1, 18-1) ............................................. 43 
`Claims 6 and 18 are Not Rendered Obvious by Kosaka in View
`of the New York Guide (Alleged Grounds 6-2, 18-2) ....................... 48 
`
`F. 
`
`G. 
`H. 
`
`I. 
`
`J. 
`
`
`
`i
`
`

`

`
`
`V. 
`
`K. 
`
`The Dependent Claims are Allowable at Least for the Reasons
`Noted Above ....................................................................................... 50 
`IV.  The ‘970 Patent is a Patent for a Technological Invention and is
`Ineligible for Covered Business Method Review ......................................... 50 
`A.  A Comparison of the Claimed Subject Matter of the ‘970 Patent
`to the Examples from the Office Patent Trial Practice Guide
`Demonstrates that the ‘970 Patent is a Patent for a
`Technological Invention that is Not Subject to Covered
`Business Method Review ................................................................... 52 
`The Claimed Subject Matter of the ‘970 Patent as a Whole
`Recites a Technological Feature that is Novel and Unobvious
`Over the Prior Art ............................................................................... 56 
`The Claimed Subject Matter as a Whole Solves a Technical
`Problem Using a Technical Solution .................................................. 64 
`The ‘970 Patent is Not Subject to Covered Business Method
`Review ................................................................................................ 68 
`Conclusion .................................................................................................... 68 
`
`B. 
`
`C. 
`
`D. 
`
`ii
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`

`

`
`
`TABLE OF AUTHORITIES
`
`
`
`
`CASES
`Cybersource Corp. v. Retail Decisions, Inc.,
`654 F.3d 1366 (Fed. Cir. 2011) .......................................................................... 53
`
`Page
`
`Ex parte Acharya,
`App. No. 2010-3919 (BPAI June 19, 2012) ........................................... 18, 20, 21
`
`Ex parte Hirsch,
`App. No. 1999-1037 (BPAI Mar. 17, 2000) ....................................................... 30
`
`Ex parte Krivokapic,
`App. No. 1998-2649 (BPAI July 18, 2001) ........................................................ 29
`
`Ex parte Levy,
`17 U.S.P.Q.2d 1461 (BPAI 1990) .......................................................... 23, 35, 47
`
`Ex parte Oetiker,
`23 U.S.P.Q.2d 1651 (BPAI 1992) ...................................................................... 29
`
`Ex parte Taguchi,
`App. No. 2000-0768 (BPAI Dec. 17, 2001) ................................................. 28, 29
`
`In re Kotzab,
`217 F.3d 1365 (Fed. Cir. 2000) ............................................................................ 3
`
`In re Robertson,
`169 F.3d 743 (Fed. Cir. 1999) ...................................................................... 25, 35
`
`In re Rouffet,
`149 F.3d 1350 (Fed. Cir. 1998) ............................................................................ 3
`
`Panduit Corp. v. Dennison Mfg. Co.,
`810 F.2d 1561 (Fed. Cir. 1987) ............................................................................ 3
`
`STATUTES
`
`35 U.S.C. § 103 ............................................................................................ 28, 29, 30
`
`
`
`iii
`
`

`

`TABLE OF AUTHORITIES
`(continued)
`
`Page
`
`
`35 U.S.C. § 325(d) ............................................................................................passim
`
`Leahy-Smith America Invents Act, Section 18 ............................................... 1, 8, 50
`
`RULES
`
`37 C.F.R. § 42.20(c) ................................................................................................... 9
`
`37 C.F.R. § 42.207 ..................................................................................................... 1
`
`37 C.F.R. § 42.301 ....................................................................................... 50, 51, 55
`
`37 C.F.R. § 42.304(a) ............................................................................................... 51
`
`OTHER AUTHORITIES
`
`157 Cong. Rec. S1042 (daily ed. Mar. 1, 2011) (statement of Sen. Kyl) ................ 12
`
`Changes to Implement Transitional Program for Covered Business Method
`Patents,
`77 Fed. Reg. 48702 (Aug. 14, 2012) .................................................................. 16
`77 Fed. Reg. 48709 (Aug. 14, 2012) .................................................................. 51
`
`Fuzzy Thinking Has Merits When It Comes to Elevators, New York, Sept.
`22, 1993 ............................................................................................................... 18
`
`Office Patent Trial Practice Guide,
`77 Fed. Reg. 48764 (Aug. 14, 2012) ............................................................ 52, 58
`
`The Telematics Advantage: Growth, Retention and Transformational
`Improvement with Usage-Based Insurance, Cognizant 20-20 Insights,
`January 2012 ........................................................................................................ 4
`
`Transitional Program for Covered Business Method Patents,
`77 Fed. Reg. 48734 (Aug. 14, 2012) .............................................................. 8, 50
`
`U.S. Patent No. 5,465,079 .................................................................................. 15, 25
`
`Usage-Based Insurance Next Wave for Personal Auto, PropertyCasualty360,
`July 14, 2011 ......................................................................................................... 5
`
`iv
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`

`

`Case CBM2012-00002
`Patent 6,064,970
`
`
`Mail Stop PATENT BOARD
`Patent Trial and Appeal Board
`U.S. Patent & Trademark Office
`P.O. Box 1450
`Alexandria, VA 22313-1450
`
`I.
`
`
`INTRODUCTION
`
`Liberty Mutual’s petition for review of U.S. Patent No. 6,064,970 (the “‘970
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`patent”) should be rejected for several reasons. First, the petition presents and
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`relies upon substantially the same prior art and arguments that were already
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`considered in reexamination control no. 90/011,252, based on a request that
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`Liberty Mutual filed on September 22, 2010. Under 35 U.S.C. § 325(d), this board
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`need not and should not second guess issues of patentability which the Central
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`Reexamination Unit (“CRU”) previously resolved in issuing a reexamination
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`certificate (No. 6,064,970C1) earlier this year. This is particularly true in a review
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`requested under the Covered Business Method Patent procedures of Section 18 of
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`the America Invents Act (“AIA”), 125 Stat. 329-31 (2011), under which a
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`petitioner may apply for a stay of a pending infringement case. Petitions that
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`challenge a patent based on previously rejected grounds and cumulative and
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`duplicative art should be denied, lest petitioners be given an unwarranted and
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`unfair procedural advantage in pending infringement litigation.1
`
`
`1 Petitioner Liberty Mutual previously sought and obtained a stay of the
`pending district court litigation involving the ‘970 patent for the entire duration of
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`
`
`
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`1
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`

`

`The Petitioner’s repetition of the art and arguments made in the prior
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`Case CBM2012-00002
`Patent 6,064,970
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`
`
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`reexamination is by itself a basis for denying the petition. In deciding whether to
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`institute a covered business method review proceeding, the Patent Trial and Appeal
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`Board (“PTAB”) “may take into account whether, and reject the petition . . .
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`because, the same or substantially the same prior art or arguments previously were
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`presented to the Office.” 35 U.S.C. § 325(d) (emphasis added). The Kosaka,
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`Black Magic, New York Guide, and Florida Guide references relied upon by the
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`Petitioner here were all cited to and previously considered by the Office during the
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`prior reexamination. Further, as explained in detail below, the one reference that
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`was not itself cited in the reexamination, Herrod, is cumulative of art previously
`
`considered by the Office and thus “substantially the same prior art” as that which
`
`was previously considered; it is also redundant of references asserted in the
`
`petition. Likewise, the Petitioner’s arguments are substantially the same as the
`
`arguments at issue in the prior reexamination. Accordingly, no review should be
`
`instituted based on this petition, since it constitutes the kind of impermissible,
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`duplicative attack on the ‘970 patent that should be rejected under 35 U.S.C.
`
`§ 325(d).
`
`
`(continued…)
`
`
`the reexamination. The Petitioner sought another stay after filing the present
`petition. That stay was denied without prejudice and with leave to re-file later.
`
`
`
`
`
`2
`
`

`

`Second, the Petitioner has not met its burden to show that any of the claims
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`Case CBM2012-00002
`Patent 6,064,970
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`
`
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`of the ‘970 patent is unpatentable. Here, as in the reexamination, the Petitioner
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`attempts to challenge the ‘970 patent by dissecting the claims into pieces and
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`arguing that they are “merely an attempt to claim ideas long known in the art.”
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`(Petition at 1; see also Petition at 2, 3.) But “[m]ost if not all inventions arise from
`
`a combination of old elements.” In re Kotzab, 217 F.3d 1365, 1369 (Fed. Cir.
`
`2000); accord In re Rouffet, 149 F.3d 1350, 1357 (Fed. Cir. 1998). The
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`Petitioner’s argument ignores a bedrock principle of United States patent law: It is
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`improper to dissect a claimed invention into discrete elements and then evaluate
`
`those elements one-by-one. Rather, the claims must be considered as a whole,
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`because it is the combination of claim limitations functioning together that
`
`constitutes the claimed invention. See, e.g., Panduit Corp. v. Dennison Mfg. Co.,
`
`810 F.2d 1561, 1567 (Fed. Cir. 1987) (“Courts are required to view the claimed
`
`invention as a whole.”) (emphasis in original); see also M.P.E.P. § 2141.02. The
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`combinations of claim elements set forth in the ‘970 patent claims recite a novel
`
`configuration of technological features that operates in a unique manner. The ‘970
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`claims are not invalid in view of the art cited by the Petitioner.
`
`
`
`The ‘970 patent’s novel configuration of technological features, along with
`
`other innovations, enabled the patent owner – Progressive Casualty Insurance
`
`Company (“Progressive”) – to create an entirely new product line known as
`
`
`
`
`
`3
`
`

`

`
`“usage-based insurance.” Progressive’s novel technology – since imitated by
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`Case CBM2012-00002
`Patent 6,064,970
`
`many of its competitors – provided a dramatic improvement over prior methods of
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`monitoring, recording, communicating, and processing operator and vehicle
`
`driving characteristics, for use in determining vehicle insurance costs and ratings.
`
`Progressive’s pioneer status within the field of usage-based insurance is evidenced
`
`by the very early January 29, 1996, filing date of the parent application to the ‘970
`
`patent. The inventions claimed in the ‘970 patent were simply not known or used
`
`by others at this time. Indeed, one of the Petitioner’s cited references, “Black
`
`Magic,” published near the effective filing date of the ‘970 patent, acknowledged
`
`as much by describing the concept of usage-based insurance as “science fiction.”
`
`(Ex. 1008, Black Magic at 1.)
`
`
`
`The technological innovations described and claimed in Progressive’s
`
`pioneering patent applications have enabled that “science fiction” to become
`
`reality. Progressive’s leadership in usage-based insurance has been acknowledged
`
`in industry publications.2 As shown below, one published report identifies
`
`
`2 E.g., “Telematics Pioneers - One leading carrier, Progressive Insurance,
`has over a decade’s headstart with Telematics. Its patented ‘Snapshot’ program is
`already rolled out, with enrollments increasing to 50,000 new policyholders a
`month in 39 states. As such, Progressive has proved the acceptance and scalability
`of UBI in the U.S.” (Ex. 2001, The Telematics Advantage: Growth, Retention and
`Transformational Improvement with Usage-Based Insurance, Cognizant 20-20
`
`
`
`
`
`4
`
`

`

`
`Progressive as the only company having greater than six years experience in the
`
`Case CBM2012-00002
`Patent 6,064,970
`
`usage-based insurance field. (Ex. 2001 at 2.)
`
`
`
`
`
`The claims of the ‘970 patent recite technological features that generate,
`
`communicate, and process data used to determine insurance ratings and/or costs
`
`reflecting actual driver/vehicle operating characteristics. (See, e.g., ‘970 patent at
`
`claim 6, reciting one or more data elements that are “actual driving
`
`characteristics.”) Prior methods employed by insurance companies relied on
`
`
`(continued…)
`
`
`Insights, January 2012, at 2.) See also Ex. 2002, Usage-Based Insurance Next
`Wave for Personal Auto, PropertyCasualty360, July 14, 2011: “Progressive has
`been one of the early leaders and continues in that direction, having introduced its
`usage-based product in 37 states and the District of Columbia thus far . . . .”
`
`
`
`
`
`5
`
`

`

`
`general demographic information to fit drivers and vehicles into broad actuarial
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`Case CBM2012-00002
`Patent 6,064,970
`
`classes of insurance from which the insurance risk posed by a particular policy
`
`could be estimated. (Id., 1:28-2:54.) By contrast, the claimed methods of the ‘970
`
`patent involve the use of electronics and sensors connected to a vehicle, which
`
`enable the claimed steps of, for example, extracting and analyzing data concerning
`
`vehicle performance to occur. The result is a network of hardware and sensors that
`
`monitor, collect, and record data about an insured vehicle; communication
`
`technology (i.e., cellular telephone, radio, satellite, or other wireless
`
`communication systems) used to transmit the data to a central computer; and the
`
`central computer that analyzes and processes that data. These technical features
`
`permit the development of an insurance rating that is specific to the operator or
`
`vehicle, based upon the manner in which that particular vehicle is operated.
`
`
`
`Figure 3 of the ‘970 patent and the accompanying description illustrate some
`
`of these aspects of the technological invention claimed in the ‘970 patent:
`
`
`
`
`
`6
`
`

`

`Case CBM2012-00002
`Patent 6,064,970
`
`
`
`With reference to FIG. 3, an exemplary motor vehicle is shown in
`which the necessary apparatus for implementing the subject invention
`is included. An on-board computer 300 monitors and records various
`sensors and operator actions to acquire the desired data for
`determining a fair cost of insurance. Although not shown therein, a
`plurality of operating sensors are associated with the motor vehicle to
`monitor a wide variety of raw data elements. Such data elements are
`communicated to the computer through a connections cable which is
`operatively connected to the vehicle data bus 304 through an SAE-
`J1978 connector, or OBD-II connector or other vehicle sensors
`306. . . . Tracking of the vehicle for location identification can be
`implemented by the computer 300 through navigation signals obtained
`from a GPS (global positioning system) antenna or other locating
`system 312. The communications link to a central control station is
`
`
`7
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`
`
`
`
`

`

`Case CBM2012-00002
`Patent 6,064,970
`
`
`
`accomplished through the cellular telephone, radio, satellite or other
`wireless communication system 314.
`
`(‘970 patent, 6:44-65, emphasis added.)
`
`
`
`Contrary to the Petitioner’s mischaracterization of the ‘970 claims (see
`
`Petition at 1-3), the components shown in Figure 3 are technological features that
`
`are configured to operate in a unique manner and ultimately used to determine
`
`insurance costs or ratings. As described in further detail below, claims 1 and 3-18
`
`of the ‘970 patent recite novel, patentable methods, and the Petitioner’s invalidity
`
`arguments under §§ 102 and 103 have no merit. Lacking sufficient grounds
`
`demonstrating that it is more likely than not that at least one of the claims
`
`challenged in the petition is unpatentable, Liberty Mutual’s petition should be
`
`denied.
`
`
`
`Further, the Petitioner’s request for covered business method review of the
`
`‘970 patent should be denied for an additional reason: The ‘970 patent is not a
`
`covered business method patent as contemplated by Congress. Section 18 of the
`
`AIA provides that the Director may institute a transitional proceeding only for a
`
`patent that is a covered business method patent. Leahy-Smith America Invents
`
`Act, Pub. L. No. 112-29, § 18 (2011); Transitional Program for Covered Business
`
`Method Patents, 77 Fed. Reg. 48734 (Aug. 14, 2012). Section 18(d)(1) defines a
`
`covered business method patent as a patent that claims a method or corresponding
`
`
`
`
`
`8
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`

`

`
`apparatus for performing data processing or other operations used in the practice,
`
`Case CBM2012-00002
`Patent 6,064,970
`
`administration, or management of a financial product or service, except that the
`
`term does not include patents for technological inventions. The significant
`
`technological features recited in the claims of the ‘970 patent, including sensors,
`
`communications technology, and a central computer, have a significant role (i.e., a
`
`non-conventional role) in the novelty of the claims. In light of this, the ‘970 patent
`
`is a patent for a “technological invention” and not subject to covered business
`
`method review.
`
`
`
`The Petitioner has the burden of proof to establish that it is entitled to the
`
`requested relief. 37 C.F.R. § 42.20(c) (2012). As detailed below, the Petitioner
`
`has not met its burden because it has not established that it is more likely than not
`
`that any of the claims challenged in the petition is unpatentable. Id. § 42.208(c). It
`
`is therefore respectfully requested that the petition be denied.
`
`II. BACKGROUND INFORMATION/CLAIM CONSTRUCTION
`The Petitioner devotes more than a few pages at the beginning of its petition
`
`
`
`to a misleading and inaccurate review of the ‘970 patent, its prosecution history,
`
`the history of the reexamination proceedings, and claim construction arguments.
`
`Although the patent owner disagrees with much of this presentation, Progressive
`
`has elected to address the Petitioner’s arguments on the merits below rather than
`
`respond in detail here, though Progressive does intend to address all of the
`
`
`
`
`
`9
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`

`

`
`Petitioner’s erroneous statements there. Nonetheless, in these sections the
`
`Case CBM2012-00002
`Patent 6,064,970
`
`Petitioner has acknowledged at least two key facts:
`
`1. The ‘970 patent itself acknowledges that actuarial classes were used to
`
`classify insurance applicants for the purpose of assigning rates.
`
`2. The main references on which this petition relies (including Kosaka and
`
`Black Magic) were already considered by the Office during the
`
`reexamination.
`
`As seen below, these facts undermine the petition.
`
`III. THE PETITION RELIES ON ART THAT IS NOT NEW AND
`MISSING KEY LIMITATIONS, THEREBY FAILING TO SATISFY
`THE ELEVATED THRESHOLD STANDARD REQUIRING A
`SHOWING THAT IT IS MORE LIKELY THAN NOT THAT THE
`CHALLENGED CLAIM WILL BE FOUND INVALID
`
`The Petitioner asserts at least two grounds of unpatentability for each of the
`
`independent claims. Even though Kosaka was considered in significant detail by
`
`the Examiner in the reexamination proceeding by itself and along with other
`
`references, the Petitioner argues again here such combinations render the claims
`
`unpatentable. Because the Petitioner’s arguments are based on references that
`
`were already cited to the Patent Office during the reexamination, they represent
`
`nothing more than the Petitioner’s request that the PTAB rehear grounds that were
`
`already considered in that reexamination proceeding. To do so would be contrary
`
`
`
`
`
`10
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`

`

`
`to the AIA and its legislative history, which foreclose repeated petitions that rely
`
`Case CBM2012-00002
`Patent 6,064,970
`
`on the same art and arguments.
`
`A. Contrary to the Express Intent of 35 U.S.C. § 325(d), the Cited
`References Are the Same or Substantially the Same as the
`References in the Reexamination
`
`Despite the Examiner’s finding in the reexamination that the ‘970 claims
`
`were patentable over Kosaka in view of other references (i.e., Black Magic, New
`
`York Guide, and Florida Guide), the present petition asks that the Patent Office
`
`expend more time and resources to reconsider these references yet again.
`
`Moreover, the only reference not previously cited – Herrod – provides no new
`
`teaching and is merely cumulative of other references already considered by the
`
`Patent Office.
`
`Section 325(d) authorizes the Patent Office to reject petitions that seek to
`
`reargue positions previously lost:
`
`In determining whether to institute or order a proceeding under this
`chapter, chapter 30, or chapter 31, the Director may take into account
`whether, and reject the petition or request because, the same or
`substantially the same prior art or arguments previously were
`presented to the Office.
`
`(Emphasis added.) The legislative history of § 325(d) confirms that this is exactly
`
`what Congress intended. For instance, Senator Kyl stated that § 325(d) “allows the
`
`Patent Office to reject any request for a proceeding, including a request for ex
`
`
`
`
`
`11
`
`

`

`
`parte reexamination, if the same or substantially the same prior art or arguments
`
`Case CBM2012-00002
`Patent 6,064,970
`
`previously were presented to the Office with respect to that patent.” Ex. 2003, 157
`
`Cong. Rec. S1042 (daily ed. Mar. 1, 2011) (statement of Sen. Kyl).
`
`
`
`As demonstrated below, the petition should be rejected because the asserted
`
`art and arguments were already considered by the Patent Office:
`
` Kosaka. Kosaka is the same reference that was before the Patent Office in
`
`the reexamination of the ‘970 patent. For claims 1, 4, 5, 6, and 18, the
`
`petition uses Kosaka in exactly the same way as it did before the CRU. For
`
`example for claim 1, the Examiner in the reexamination expressly
`
`considered Kosaka for these same limitations and found that “Kosaka ‘868
`
`and Black Magic also do not provide such teachings, see, e.g., English
`
`translation of ‘868 page 6 or 426, col. 1, last full paragraph.” (Ex. 1003 at
`
`30, Notice of Intent to Issue ex parte Reexamination Certificate (“NIIRC”)
`
`at 14, emphasis added; see also Ex. 1003 at 37, NIIRC at 21.) Similarly, the
`
`Examiner considered Kosaka for claims 4 and 5 and expressly found that the
`
`“‘868 [Kosaka reference] does not clearly and explicitly teach . . .” the
`
`limitations as “set forth in claims 4 and 5.” (Ex. 1003 at 32-33, NIIRC at
`
`16-17.) Accordingly, Kosaka constitutes “the same . . . prior art or
`
`arguments previously . . . presented to the Office” with respect to the ‘970
`
`patent. 35 U.S.C. § 325(d).
`
`
`
`
`
`12
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`

`

`
`
`Case CBM2012-00002
`Patent 6,064,970
`
` Black Magic. Black Magic is also the same reference as was previously
`
`before the Patent Office in the reexamination of the ‘970 patent and is being
`
`used for the same purpose as in the previous proceeding (i.e., rejection of
`
`claim 1). In alleged ground 1-1,3 the Petitioner maintains that Black Magic
`
`discloses limitation (1e) of claim 1. However, the prior proceeding used
`
`Black Magic in exactly this same way. (Ex. 1003 at 30, NIIRC at 14.)
`
`Accordingly, Black Magic constitutes “the same . . . prior art or arguments
`
`previously . . . presented to the Office” with respect to the ‘970 patent. 35
`
`U.S.C. § 325(d).
`
` New York Guide and Florida Guide. The New York Guide and Florida
`
`Guide also were before the Patent Office in the reexamination of the ‘970
`
`patent. (See Ex. 1003 at 42, November 9, 2011, List of References
`
`Considered by Examiner.) Further, not only were these references
`
`considered by the Examiner in the prior reexamination proceeding, they
`
`discuss the same subject matter (i.e., the existence of traditional actuarial
`
`classes) that the Petitioner concedes is disclosed in the background of the
`
`
`3 “Alleged ground 1-1” refers to the Petitioner’s first argument for
`unpatentability against claim 1. “Alleged ground 1-2” refers to the second
`argument for unpatentability against claim 1, and other arguments are referred to in
`a like manner.
`
`
`
`
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`13
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`Case CBM2012-00002
`Patent 6,064,970
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`‘970 patent. (See ‘970 patent, 1:22-2:12.) The Petitioner uses these
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`references for the most mundane (and cumulative) of propositions: that the
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`broad concept of actuarial classes was known, a fact acknowledged in
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`columns 1 and 2 of the specification of the ‘970 patent.4 Accordingly, the
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`Petitioner relies upon the New York Guide and Florida Guide for “the
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`same . . . prior art or arguments previously . . . presented to the Office” with
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`respect to the ‘970 patent. 35 U.S.C. § 325(d).
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` Herrod. Herrod is cumulative of and substantially similar to references
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`already considered by the Patent Office during the reexamination of the ‘970
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`patent. The petition itself treats Herrod as being redundant of New York
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`Guide and Florida Guide. Nor does the petition differentiate among these
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`references. The Petitioner provides no explanation or argument as to why
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`any of these references would be preferred over the others with respect to the
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`alleged grounds of unpatentability. The Petitioner repeatedly uses Herrod
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`only as a redundant “backup” reference in case its inherency arguments for
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`Kosaka fail and for the same reason as it uses the New York Guide and
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`4 Petitioner asserts that New York Guide and Florida Guide were given
`“limited consideration” in the reexamination of the ‘970 patent. (Petition at 27
`n.12.) However, only a limited consideration is needed to perceive the well-
`established fact that actuarial classes are not new.
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`Case CBM2012-00002
`Patent 6,064,970
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`Florida Guide.5 Further, Herrod is cumulative of still other references
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`considered in the prior reexamination, such as Bouchard. (See, e.g., U.S.
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`Patent No. 5,465,079 (“Bouchard”).) In Herrod – as in Bouchard (e.g., id. at
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`34:11-22) – the driver’s performance is analyzed at the vehicle and safety
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`information is provided to him. (Ex. 1007, Herrod at 1.) Accordingly,
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`Herrod constitutes “substantially the same prior art or arguments
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`previously . . . presented to the Office” with respect to the ‘970 patent.
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`35 U.S.C. § 325(d).
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`As shown above, each of the Petitioner’s references are the same or
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`substantially the same, as the references already considered by the Patent Office
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`during the prior reexamination. The secondary references, moreover, are
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`redundant of each other.
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`Accordingly, the Petitioner adds nothing substantively new to previously
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`made arguments and does not cast the references in a new light. This is contrary to
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`the strictures of 35 U.S.C. § 325(d), under which “the Director may take into
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`account whether, and reject the petition or request because, the same or
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`5 This redundancy, by itself, is a basis to deny consideration of Herrod. This
`is exactly how the PTAB handled similar redundant references in a co-pending
`petition (CBM2012-00003), in which the PTAB sua sponte issued an order
`identifying numerous of Petitioner’s alleged grounds as being redundant and
`ultimately denied 184 grounds on this basis.
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`substantially the same prior art or arguments previously were presented to the
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`Case CBM2012-00002
`Patent 6,064,970
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`Office.”6 For this reason, the petition should be denied.
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`B. Claim 1 is Not Rendered Obvious by Kosaka in View of Black
`Magic and Herrod (Alleged Ground 1-1)
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`As the CRU previously found, Kosaka and Black Magic do not disclose
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`certain key limitations of claim 1. Although the Petitioner argues that Kosaka
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`inherently discloses “generating actuarial classes of insurance, which group
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`operators or vehicles having a similar risk characteristic,” the petition does not
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`contend that Kosaka teaches – either expressly or inherently – any of the remainder
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`of limitation (1b) where the actuarial classes of insurance are generated “from
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`actual monitored driving characteristics during a selected time period as
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`represented by recorded data elements representative of an operating state of the
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`vehicles or an action of the operators.” Thus, the Petitioner tacitly admits that
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`Kosaka does not disclose how the actuarial classes of claim 1 are generated. Since
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`this feature is not disclosed in Kosaka, the Petitioner has failed to sustain its burden
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`to show that claim 1 is unpatentable over Kosaka and Black Magic.
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`6 See also Changes to Implement Transitional Program for Covered Business
`Method Patents, 77 Fed. Reg. 48702 (Aug. 14, 2012), noting that “[t]he Office . . .
`will exercise its authority under 35 U.S.C. § 325(d), where appropriate, to deny
`petitions that submit the same or substantially the same prior art or arguments
`previously presented to the Office.”
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`Having failed to show that Kosaka by itself teaches the subject matter of
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`Case CBM2012-00002
`Patent 6,064,970
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`claim limitation (1b), the petition argues that, to the extent that any further
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`disclosure may be required with respect to limitation (1b), Kosaka should be
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`combined with Herrod. As demonstrated below, this argument fails for two
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`reasons. First, the disclosures of Kosaka and Herrod are incompatible, such that
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`one would not have attempted to combine them. Second, even if the two
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`references were combined, the combination does not disclose all the elements of
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`the claim.
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`1. Kosaka And Herrod Cannot Be Combined In View Of
`Fundamental Differences In Their Disclosures
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`The Petitioner argues that a person of ordinary skill would combine the
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`Herrod and Kosaka references to achieve a disclosure of actuarial classes of
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`insurance associated with different levels of risk, which group operators of
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`vehicles having similar risk characteristics based on actual monitored driving
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`characteristics. (Petition at 36-37, 55-56.) However, H