Covered Business Method Review
`United States Patent No. 7,840,486
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`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
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`––––––––––
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`––––––––––
`
`MASTERCARD INTERNATIONAL INCORPORATED
`Petitioner
`
`v.
`
`JOHN D’AGOSTINO
`Patent Owner
`
`––––––––––
`
`
`Patent No. 7,840,486
`Application No. 11/252,009
`Filed: October 17, 2005
`Issued: November 23, 2010
`Title: System and Method for Performing Secure Credit Card Transactions
`
`––––––––––
`
`PETITION FOR COVERED BUSINESS METHOD PATENT REVIEW
`UNDER 35 U.S.C. § 321, 37 C.F.R. § 42.304
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`Covered Business Method Review
`United States Patent No. 7,840,486
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` TABLE OF CONTENTS
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`LIST OF EXHIBITS……………………………………………………………....iv
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`I.
`
`II.
`
`INTRODUCTION........................................................................................1
`
`PETITIONER HAS STANDING ................................................................2
`
`A.
`
`B.
`
`The ‘486 Patent is a Covered Business Method Patent ...............................2
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`Petitioner is a Real Party in Interest Sued for Infringement........................5
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`
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`
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`III.
`
`C. Related Matters ............................................................................................5
`
`OVERVIEW OF SPECIFIC GROUNDS FOR WHICH IT IS MORE
`LIKELY THAN NOT THAT THE CHALLENGED CLAIMS (1-30) OF
`THE ‘486 PATENT ARE UNPATENTABLE............................................6
`
`IV.
`
`BACKGROUND INFORMATION FOR THE ‘486 PATENT ..................7
`
`A. Overview of the ‘486 Patent ........................................................................7
`
`B.
`
`The ‘486 Patent Prosecution History ...........................................................7
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`
`
`
`
`C.
`
`
`V.
`
`The ‘988 Patent Ex Parte Reexamination File History .............................10
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`DETAILED EXPLANATION OF REASONS FOR RELIEF SHOWING
`IT IS MORE LIKELY THAN NOT THAT THE CHALLENGED
`CLAIMS ARE UNPATENTABLE...........................................................12
`
`A.
`
`The Challenged Claims are Invalid under §§ 102 and/or 103 ...................12
`
`1. Claim Construction.................................................................................13
`
`2. Ground 1: Claims 1-15 and 22-30 are Anticipated Under 35 U.S.C. §
`102 by Cohen ..........................................................................................15
`
`3. Ground 2: Claims 16-21 are Obvious Under 35 U.S.C. § 103 by Cohen
`in View of Musmanno ............................................................................37
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`4. Ground 3: Claims 1-15 and 22-30 are Anticipated Under 35 U.S.C. §
`102 by Flitcroft .......................................................................................45
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`Covered Business Method Review
`United States Patent No. 7,840,486
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`5. Ground 4: Claims 16-21 are Obvious Under 35 U.S.C. § 103 by Flitcroft
`in View of Musmanno ............................................................................69
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`CONCLUSION ..........................................................................................79
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`VI.
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`PETITIONER’S LIST OF EXHIBITS
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`Exhibit 1001 – U.S. Patent No. 7,840,486
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`Exhibit 1002 – File History for U.S. Patent No. 7,840,486
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`Exhibit 1003 – File History for U.S. Reexamination No. 90/012,517
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`Exhibit 1004 – U.S. Patent No. 6,422,462 (“Cohen”)
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`Exhibit 1005 – U.S. Patent No. 6,636,833 (“Flitcroft”)
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`Exhibit 1006 – U.S. Patent No. 5,826,243 (“Musmanno”)
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`Exhibit 1007 – Complaint in D’Agostino v. MasterCard, Inc. et al. (13-cv-0738)
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`Exhibit 1008 – Declaration of Jack D. Grimes, Ph.D.
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`Exhibit 1009 – Excerpts from Random House Webster’s Unabridged Dictionary,
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`Second Edition
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`Exhibit 1010 – U.S. Patent No. 6,064,987 (“Walker”)
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`Exhibit 1011 – U.S. Patent No. 5,283,829 (“Anderson”)
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`Exhibit 1012 – ISO 8583 Financial Transaction Card Originated Messages –
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`Interchange Message Specifications (1992) (“ISO 8583”)
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`Exhibit 1013 – File History for U.S. Patent No. 8,036,988
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`Pursuant to 35 U.S.C. § 321 and 37 C.F.R. § 42.304, MasterCard
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`International Incorporated (“Petitioner” and real party in interest), hereby petitions
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`for review under the transitional program for covered business method patents of
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`claims 1-30 (all claims) of U.S. Pat. No. 7,840,486 (“the ‘486 Patent”), issued to
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`John D’Agostino (“D’Agostino”). Petitioner hereby asserts it is more likely than
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`not that at least one of the challenged claims is unpatentable and respectfully
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`requests review of, and judgment against, Claims 1-30 as unpatentable under §§
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`102 and/or 103.
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`I.
`
`INTRODUCTION
`
`The ‘486 Patent attempts to claim the use of a transaction code – in lieu of a
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`credit card number – for making secure transactions that are limited to a single
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`merchant. This was a practice that was common in the credit card industry before
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`the priority date of the ‘486 Patent. During prosecution, the ‘486 Patent issued
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`only after the Applicant attempted to distinguish the claims over the prior art on
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`the basis of the following limitation:
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`defining a payment category including at least limiting purchases to a
`single merchant for at least one transaction, said single merchant
`limitation being included in said payment category prior to any
`particular merchant being identified as said single merchant
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`However, this limitation does not in fact distinguish the claims of the ‘486
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`patent from the prior art. The prior art already disclosed the use of credit card
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`Covered Business Method Review
`United States Patent No. 7,840,486
`transaction codes that were limited to a single transaction, which inherently limits
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`the card to use at a single merchant – because once the card is first used at any
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`merchant, it cannot be used again. Therefore, the Applicant had claimed in the
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`‘486 Patent nothing more than a feature that was inherently disclosed in the prior
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`art. Accordingly, and as explained in detail below, the prior art invalidates the
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`‘486 Patent.
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`II.
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`PETITIONER HAS STANDING
`
`A.
`
`The ‘486 Patent is a Covered Business Method Patent
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`The ‘486 Patent is a “covered business method patent” under § 18(d)(1) of
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`the Leahy-Smith America Invents Act, Pub. L. 112-29 (“AIA”) and § 42.301.
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`More specifically, the term “covered business method patent” means “a patent that
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`claims a method or corresponding apparatus for performing data processing or
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`other operations used in the practice, administration, or management of a financial
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`product or service, except that the term does not include patents for technological
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`inventions.” See AIA § 18(d)(1); 37 C.F.R. § 42.301(a); see also 77 Fed. Reg.
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`48733, 48735 (Aug. 14, 2012). The legislative history explains that the definition
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`of covered business method patent was drafted to encompass patents “claiming
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`activities that are financial in nature, incidental to a financial activity or
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`complementary to a financial activity.” See 77 Fed. Reg. 48735 (Aug. 14, 2012).
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`
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`Here, the ‘486 Patent claims a method for data processing and other
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`operations used in the practice, administration, and management of a financial
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`product and service, and more particularly to a method for performing secure credit
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`card purchases. The claimed method involves the creation and use of a transaction
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`code wherein a customer does not need to reveal their credit card number to a
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`merchant in order to make a purchase. Thus, the ‘486 Patent claims an activity that
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`is entirely financial in nature, and involves the operations of a financial product
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`and service, consequently qualifying it as a “covered business method patent.”
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`Moreover, the ‘486 patent is not directed to a “technological invention.” A
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`“technological invention” claims “subject matter as a whole [that] recites a
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`technological feature that is novel and unobvious over the prior art; and solves a
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`technical problem using a technical solution.” § 42.301(b).1 This is not the case
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`here. The ‘486 Patent’s claims are directed to performing ordinary credit card
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`transactions using conventional security techniques, i.e., the use of a transaction
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`1 See, e.g., 77 Fed. Reg. 48,756, 48,764 (Aug. 14, 2012) (“Mere recitation of
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`known technologies, such as computer hardware, communication or computer
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`networks, software, memory, computer-readable storage medium, . . . display
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`devices or databases, or . . . an ATM or point of sale device,” or reciting “use of
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`known prior art technology to accomplish a process or method, even if that process
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`or method is novel and non-obvious” will “not typically render a patent a
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`technological invention.”).
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`code. See Exh. 1001 at Abstract. The claimed method does not contain any novel
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`and unobvious technological feature: it merely claims the creation of a transaction
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`code and the communication of the transaction code to the account holder and
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`merchant to facilitate the secure credit card transaction. See Exh. 1001 at 4:3-24.
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`In fact, this basic use of a transaction code to facilitate secure credit card
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`transactions was well-known in the industry before the filing date of the ‘486
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`Patent, see, e.g., U.S. Patent No. 6,422,462 to Cohen; U.S. Patent No. 6,636,833 to
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`Flitcroft et al. The claims of the ‘486 Patent recite no particular hardware,
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`arrangement of hardware, or software to implement the system. See CBM2012-
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`00001, Decision Instituting CBM Review, Paper No. 36, at 27 (January 9, 2013)
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`(holding that the claims were not directed to a technological invention because “no
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`specific, unconventional software, computer equipment, tools or processing
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`capabilities are required” by the claims). In addition, the subject matter as a whole
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`solves no “technical problem,” and instead is directed to a method of carrying out a
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`financial transaction.
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`In addition, the ‘486 Patent is classified into Class 705. As the legislative
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`history of the AIA reveals, this classification raises a presumption that the ‘486
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`Patent is a covered business method patent. 157 Cong. Rec. S1368, S1379 (daily
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`ed. March 8, 2011)(Statement of Sen. Kyl). Finally, as noted below, the ‘486
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`Patent has been asserted against MasterCard’s inControl offering, which is a
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`financial service. See Exh. 1007, Complaint at ¶ 19-22. This alone should suffice
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`to make the patent eligible for covered business method review. 157 Cong. Rec.
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`S1364, S1365 (daily ed. March 8, 2011)(daily ed. Statement of Sen. Schumer)(“if a
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`patent holder alleges that a financial product or service infringes its patent, that
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`patent shall be deemed to cover a financial product or service”); see also 157
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`Cong. Rec. S5432 (daily ed. Sept. 8, 2011).
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`Accordingly, the ‘486 Patent qualifies for covered business method review.
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`B.
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`Petitioner is a Real Party in Interest Sued for Infringement
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`The ‘486 Patent was asserted against Petitioner in Case No. 1:13-cv-00738,
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`John D’Agostino v. MasterCard, Inc. et al, pending in the U.S. District Court for
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`the District of Delaware. See Exh. 1007, Complaint.
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`C. Related Matters
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`As noted above, Case No. 1:13-cv-00738 is currently pending in the U.S.
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`District Court for the District of Delaware. Petitioner is also filing, concurrent
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`with this Petition, an additional Petition seeking review of the related U.S. Patent
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`Number 8,036,988 (the “‘988 Patent”), which claims priority to the ‘486 patent as
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`a continuation.
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`In addition, there is a pending reexamination for the ‘988 Patent in
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`Reexamination No. 90/0123,517, filed September 12, 2012, in the United States
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`Patent and Trademark Office. See Exh. 1003 – File History for Reexamination No.
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`90/012,517.
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`III. OVERVIEW OF SPECIFIC GROUNDS FOR WHICH IT IS MORE
`LIKELY THAN NOT THAT THE CHALLENGED CLAIMS (1-30)
`OF THE ‘486 PATENT ARE UNPATENTABLE
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`Pursuant to § 42.208 (and § 42.300), Petitioner asserts that every one of the
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`challenged claims 1-30 of the ‘486 Patent is unpatentable as invalid under §§ 102
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`and/or 103. The accompanying Exhibit List lists all prior art references relied
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`upon in the Petition for the asserted grounds of invalidity under §§ 102 and/or 103.
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`Petitioner specifically requests cancellation of the challenged claims on the
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`following statutory grounds:
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`− GROUND 1. Claims 1-15 and 22-30 are Unpatentable under 35 USC § 102 as
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`Anticipated by Cohen
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`− GROUND 2. Claims 16-21 are Unpatentable under 35 USC § 103 as Obvious
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`over Cohen in view of Musmanno
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`− GROUND 3. Claims 1-15 and 22-30 are Unpatentable under 35 USC § 102 as
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`Anticipated by Flitcroft
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`− GROUND 4. Claims 16-21 are Unpatentable under 35 USC § 103 as Obvious
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`over Flitcroft in view of Musmanno
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`Section V lists each ground upon which it is more likely than not that the
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`challenged claims are unpatentable as anticipated under §§ 102 and/or 103, and
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`renders a detailed explanation therefor. Grounds 3 and 4 are being presented in the
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`event the Board does not accept Petitioner’s construction of “generating [a/said]
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`transaction code” and adopts a broader, albeit in Petitioner’s view a faulty,
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`alternative construction, both discussed below.
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`IV. BACKGROUND INFORMATION FOR THE ‘486 PATENT
`A. Overview of the ‘486 Patent
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`The ‘486 Patent is directed to a secure method for performing credit card
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`purchases, wherein a customer submits a transaction code, rather than an entire
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`credit card number to a merchant when making a purchase. Generally, the
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`customer contacts an authorizing entity, such as a credit card company or issuing
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`bank, and requests a transaction code. The transaction code can be limited to
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`purchases within a payment category, such as limiting the code to be used with a
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`single merchant and other limitations, such as restricting the use to a particular
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`period of time. The customer can then use the transaction code to make a purchase
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`at a merchant or online.
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`B.
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`The ‘486 Patent Prosecution History
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`On October 17, 2005, the Applicant filed U.S. Patent Application No.
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`11/252,009 which ultimately issued as the ‘486 Patent. The claims of the ‘486
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`Patent issued after only two rejections citing the same prior art references during
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`prosecution. The Examiner rejected the claims in a non-final office action under §
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`103(a) as unpatentable over U.S. Patent No. 6,000,832 (“Franklin”) in view of U.S.
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`Patent Publication No. 2001/0011249 (“Yanagihara”) in further view of U.S.
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`Patent No. 5,500,513 (“Langhans”). See Exh. 1002, ‘486 Patent File History,
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`6/10/09 Office Action at 7.
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`In response to the non-final office action, the Applicant argued that
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`independent claim 1 “recites, inter alia, defining a payment category including at
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`least limiting purchases to a single merchant for at least one transaction, said single
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`merchant limitation being included in said payment category prior to any particular
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`merchant being identified as said single merchant.” See Exh. 1002, ‘486 Patent
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`File History, 12/10/09 Response to Office Action at 23 (emphasis in original). The
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`Applicant argued that the cited prior art “fails to teach or suggest the claimed
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`feature of the single merchant limitation being included in said payment category
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`prior to any particular merchant being identified as said single merchant.” Id. at 25
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`(emphasis added). The Applicant provided similar arguments for the other
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`pending independent claims. Id. at 25-28.
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`The Examiner subsequently rejected the claims in a final office action again
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`under § 103(a) as unpatentable over Franklin in view of Yanagihara in further view
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`of Langhans. See Exh. 1002, ‘486 Patent File History, 3/29/10 Final Office Action
`
`at 5.
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`In response to the final office action, the Applicant again argued that the
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`cited prior art did not teach “a single merchant limitation being included in a
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`payment category prior to any particular merchant being identified as said single
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`merchant.” See Exh. 1002, ‘486 Patent File History, 7/26/10 Response to Final
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`Office Action at 19 (emphasis in original). The Applicant provided similar
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`arguments for the other pending independent claims. Id. at 21-22.
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`After an examiner interview, the Examiner allowed the pending claims
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`noting that he found the Applicant’s arguments persuasive. More specifically, the
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`Examiner stated in the reasons for allowance the “uniquely patentable feature” of:
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`defining a payment category including at least limiting purchases to a
`single merchant for at least one transaction, said single merchant
`limitation being included in said payment category prior to any
`particular merchant being identified as said single merchant
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`See Exh. 1002, ‘486 Patent File History, 9/1/10 Notice of Allowance at 11. The
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`application subsequently issued as the ‘486 Patent on November 23, 2010.
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`
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`Prior to issuance, the Applicant filed a continuation application, U.S. Patent
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`Application No. 12/902,399, which ultimately issued as U.S. Pat. No. 8,036,988
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`(“the ‘988 Patent”). During prosecution of the ‘988 Patent, the same Examiner
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`rejected the pending claims of the ‘988 Patent in view of the ‘486 Patent,
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`concluding that the claims of the ‘988 Patent were not patentably distinct from
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`those of the ‘486 Patent. See Exh. 1013, ‘988 Patent File History, 1/14/11 Office
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`Action at 2-3. The Applicant did not contest that ground for rejection. Instead, to
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`overcome that rejection, the Applicant disclaimed the ability to enforce the ‘988
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`Patent beyond the term of the ’486 Patent – conceding that the claims of the ‘486
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`Patent and those of the ‘988 Patent are not patentably distinct from each other. See
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`Exh. 1013, ‘988 Patent File History, 3/21/11 Terminal Disclaimer.
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`C.
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`The ‘988 Patent Ex Parte Reexamination File History
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`On September 12, 2012, the Petitioner filed a Request for Ex Parte
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`Reexamination of the related ‘988 Patent, and after an initial decision denying the
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`request, on January 7, 2013, the Petitioner filed a Petition for Review under 37
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`C.F.R. § 1.181. On June 7, 2013, the Director of the Central Reexamination Unit
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`granted the Petition for Review and granted the Request for Ex Parte
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`Reexamination of the ‘988 Patent. In the decision granting the petition, the
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`Director stated: “in Cohen one can limit the transaction only to a particular type of
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`merchant, such as computer stores” and further noted that the “card can be limited
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`to use at certain types of stores, such as clothing stores.” See Exh. 1003, ‘988
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`Patent Reexamination History, 6/7/13 CRU Decision, at 5. “At the same time,
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`limiting to ‘clothing stores’ does not identify any one particular merchant.” Id.
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`The director concluded that “[a]ccordingly, it would appear that Cohen does
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`include ‘defining a payment category to include at least limiting a number of
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`transactions to one or more merchants, said one or more merchants limitation being
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`included in said payment category prior to any particular merchant being identified
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`as one of said one or more merchants’ as claimed.” Id. This element is almost
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`exactly the same as the “uniquely patentable feature” of the ‘486 Patent as
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`identified by the Examiner during prosecution of the ‘486 Patent. The principal
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`difference is that the ‘486 Patent claims a payment category that is limited to “a
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`single merchant”, where as the limitation addressed in the ‘988 Patent is a payment
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`category that is limited to “one or more merchants.”
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`To further explain the reasoning for why Cohen discloses this element, the
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`Director noted that:
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`Cohen does not necessarily limit transactions to any specific merchant
`or particular store – if Cohen provides a limit of ‘clothing stores’ then
`there is necessarily a limit on number of stores, as not all stores are
`clothing stores. At the same time there is no limit or specific
`identification of any specific store. Cohen therefore limits a number of
`transactions to one or more merchants, those of a specific industry,
`while not identifying [any] particular merchant. Limiting by industry
`does not necessarily identify a particular merchant. Id. at 6.2
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`As the Director reasoned in his decision, a particular type of store could include
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`2 In the Office Action subsequently issued in the Ex Parte Reexamination, the
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`Examiner agreed with the Director, rejecting all the claims of the ‘988 Patent. See
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`Exh. 1003, ‘988 Patent Reexamination History, 9/11/13 Office Action, at 4-5, 13-
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`14, and 18-19.
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`one or more merchants, but it undoubtedly could also be “a single merchant.” Id.
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`at 7 (granting reexamination for all claims of the ‘988 patent, including claim 21
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`which claims a payment category that is limited to “a single merchant”).3
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`Therefore, the Director found that Cohen inherently discloses the exact limitation
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`that the Applicant relied on to distinguish the claims of the ‘486 Patent from the
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`prior art.
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`V. DETAILED EXPLANATION OF REASONS FOR RELIEF
`SHOWING IT IS MORE LIKELY THAN NOT THAT THE
`CHALLENGED CLAIMS ARE UNPATENTABLE
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`Pursuant to §§ 42.22 and 42.304(b), a full statement of the reasons for the
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`relief requested, with a detailed explanation of the evidence, including material
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`facts, and the governing law, rules and precedent is provided below.
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`A.
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`The Challenged Claims are Invalid under §§ 102 and/or 103
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`The following discussion details, in Sections V.A.2-V.A.5, each ground for
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`which it is more likely than not that each challenged claim is invalid based on the
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`prior art identified above as either anticipated under § 102 or obvious under § 103
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`(or a combination, where applicable). Section V.A.1 lists and explains the bases for
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`Petitioner’s relevant claim constructions for the challenged claims.
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`3 This conclusion is consistent with the Applicant’s own admission that the claims
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`of the ‘486 Patent and the ‘988 Patent are not patentably distinct from each other.
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`See Exh. 1013, ‘988 Patent File History, 3/21/11 Terminal Disclaimer.
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`1.
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`Claim Construction
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`Pursuant to § 42.300(b), and solely for purposes of this review, Petitioner
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`construes the claim language such that claim terms are given their broadest
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`reasonable interpretation. For terms not specifically listed and construed below,
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`and in the absence, to date, of detailed arguments from D’Agostino indicating a
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`need for construction or a disagreement regarding the meaning of the vast majority
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`of terms, Petitioner interprets them for purposes of this review in accordance with
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`their plain and ordinary meaning under the required broadest reasonable
`
`interpretation. Because this standard is different from the standard used in U.S.
`
`District Court litigation, see In re Am. Acad. of Sci. Tech Ctr., 367 F.3d 1359,
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`1364, 1369 (Fed. Cir. 2004); see also MPEP § 2111, Petitioner expressly reserves
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`the right to argue in litigation a different claim construction for any term in the
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`‘486 Patent as appropriate to that proceeding.
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`• “generating [a/said] transaction code”: For review purposes, this term
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`means “creating a code usable as a substitute for a credit card number in a purchase
`
`transaction, the number pre-coded to be indicative of a specific credit card
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`account.” (Exh. 1001, ‘486 Patent at Abstract; 3:43-48; 6:19-38; 6:63-7:1; see Exh.
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`1008, Grimes Dec. at ¶ 20).4
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`4 In the event the Board does not accept Petitioner’s construction of “generating
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`[a/said] transaction code,” but concludes instead that this term means “creating a
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`• “defining a payment category”: For review purposes, this term means
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`“specifying the type of limitation (or limitations) that are available to be applied to
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`a transaction code in order to limit its use.” (Exh. 1001, ‘486 Patent at 2:67-3:3;
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`3:48-4:2; 4:20-24; 7:2-8; 7:56-8:43; see Exh. 1008, Grimes Dec. at ¶ 21).
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`• “particular merchant”: For review purposes, this term means “a
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`specific merchant with whom a customer can engage in the purchase transaction.”
`
`(Exh. 1001, ‘486 Patent at 3:67-4:2; 4:8-13; 4:44-49; see Exh. 1008, Grimes Dec.
`
`at ¶ 22).
`
`• “verifying that said defined purchase parameters are within said
`
`designated payment category”: For review purposes,
`
`this
`
`term means
`
`“ascertaining that any limitation associated with the designated payment category
`
`is satisfied.” (Exh. 1001, ‘486 Patent at 4:8-13; 7:8-24; see Exh. 1008, Grimes Dec.
`
`at ¶ 23).
`
`• “promotional material”: For review purposes, this term means “any
`
`information about the product that facilitates the purchase transaction.” (Exh. 1001,
`
`
`code usable as a substitute for a credit card number in a purchase transaction”
`
`(without the clause “the number pre-coded to be indicative of a specific credit card
`
`account”) (“Alternative Construction”) then Petitioner presents Grounds 3 and 4
`
`below.
`
`
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`

`

`Covered Business Method Review
`United States Patent No. 7,840,486
`‘486 Patent at 3:7-12; 5:36-48; 7:25-38; see Exh. 1008, Grimes Dec. at ¶ 24).
`
`2. Ground 1: Claims 1-15 and 22-30 are Anticipated Under 35
`U.S.C. § 102 by Cohen
`(i) Overview of Cohen
`
`U.S. Patent No. 6,422,462 to Cohen (Exh. 1004, “Cohen”) claims priority to
`
`U.S. Provisional Application No. 60/079,8845, which was filed on March 30, 1998.
`
`Accordingly, Cohen is prior art under at least 35 U.S.C. § 102(e), and thus
`
`Petitioner contends satisfies AIA § 18(a)(1)(C).6 Cohen teaches customized,
`
`limited use card numbers for use in purchase transactions over a credit card
`
`network. Cohen at 2:32-43.
`
`Cohen discloses an account holder contacting their credit card company,
`
`verifying their identity, and then being provided with a transaction code number to
`
`be used for a single or limited range of transactions. Id. at 3:41-48; 13:8-14. The
`
`
`5 U.S. Provisional Application No. 60/079,884 supports the subject matter relied
`
`upon in Cohen in compliance with 35 U.S.C. 112, first paragraph.
`
`6 This Board has previously instituted a Covered Business Method Patent Review
`
`on the basis of prior art under 35 U.S.C. § 102(e). See CBM 2013-00008, Decision
`
`Instituting CBM Review, Paper No. 20, at 20-21, 35 (June 24, 2013) (holding that
`
`the CBM petition was granted on the basis of prior art that included U.S. Pat. No.
`
`5,940,812 to Tengel, a 102(e) prior art reference).
`
`
`
`- 15 -
`
`

`

`Covered Business Method Review
`United States Patent No. 7,840,486
`account holder can indicate in advance the limitations applicable to the transaction
`
`code number. Id. at 3:49-52. Once the account holder has received the number,
`
`they can communicate the number to a merchant like it was a regular credit card
`
`number, which the merchant can use to obtain authorization for the purchase
`
`transaction with the credit card company. Id. at 5:35-39. The credit card company
`
`can authorize the use of the customized number, or deny it if it is used for anything
`
`other than the single or customized use indicated by the account holder. Id. at
`
`5:44-49.
`
`Examples of the customized uses for which a disposable or customized
`
`number can be indicated may include a time limit, Id. at 6:7, specific merchant or
`
`industry, Id. at 8:2-14, a specific merchant or merchants, Id. at 8:33-34, purchase
`
`amount, Id. at 8:44, etc. These various customized uses can also be used in
`
`combination, such as a customized number to be used on specific dates, for
`
`specific amounts, etc. and those limits are recorded by the credit card company and
`
`associated with the customized number for verification when payment transactions
`
`occurs, Id. at 10:24-35.
`
`(ii)
`
`Independent Claim 1
`
`Claim
`1. A method of
`performing secure
`credit card purchases,
`said method
`comprising:
`
`Cohen
`Cohen discloses “provid[ing] improved credit cards
`and methods for credit card transactions ... provid[ing]
`methods and apparatus for secure transmission of
`credit card information.” (Cohen at 1:48-62) (emphasis
`added).
`
`
`
`- 16 -
`
`

`

`a) contacting a custodial
`authorizing entity
`having custodial
`responsibility of
`account parameters of a
`customer's account that
`is used to make credit
`card purchases;
`b) supplying said
`custodial authorizing
`entity with at least
`account identification
`data of said customer's
`account;
`c) defining a payment
`category including at
`least limiting purchases
`to a single merchant for
`at least one transaction,
`
`said single merchant
`limitation being
`included in said
`payment category prior
`to any particular
`merchant being
`identified as said single
`merchant;
`
`Covered Business Method Review
`United States Patent No. 7,840,486
`Cohen discloses that a user can contact a custodial
`authorizing entity: “[A] user dials into her credit card
`company....” (Cohen at 3:42-44).
`
`Cohen discloses that a user can provide the custodial
`authorizing entity with her account identification data:
`“[A] user dials into her credit card company…and after
`providing the ordinary credit card number and
`verification data….” (Cohen at 3:42-45).
`
`Cohen discloses a use of various payment categories:
`“The card can also be customized for only particular
`uses or groups of uses.” (Cohen at 7:66-67).
`Cohen discloses a payment category limiting
`transactions to a single merchant: “The card could
`even [be] customized for use in a particular store
`itself...” (Cohen at 8:25-34).
`“[I]n one embodiment…[t]hese credit cards or credit
`card numbers are generated for a one time, single
`transaction basis, after which they are disposed of, or
`thrown away. The numbers can be used…to effect a
`single transaction.” (Cohen at 2:35-43) (emphasis
`added). See Exh. 1008, Grimes Dec. at ¶ 31.
`Cohen discloses that the transaction code is limited to
`a single transaction with one merchant: “in one
`embodiment…[t]hese credit cards or credit card
`numbers are generated for a one time, single
`transaction basis” and then “[a]fter a one time use of
`the credit card number, the number is deactivated.”
`(Cohen at 2:35-43). The merchant for the one-time use
`credit card is not identified until the credit card is used
`for the single transaction. Therefore, the credit card is
`limited to a single transaction with one merchant
`before the merchant is identified at the time the credit
`card is used. See Exh. 1008, Grimes Dec. at ¶ 32.
`
`
`
`- 17 -
`
`

`

`d) designating said
`payment category
`thereby designating at
`least that a transaction
`code generated in
`accordance with said
`payment category can
`be used by only one
`merchant;
`
`e) generating a
`transaction code by a
`processing computer of
`said custodial
`authorizing entity,
`
`said transaction code
`reflecting at least the
`limits of said designated
`
`Covered Business Method Review
`United States Patent No. 7,840,486
`Cohen discloses a user designating the payment
`category by specifying the type(s) of limitation to
`apply: “a user can indicate in advance of
`purchase...what the single use or the customized credit
`card number is to be used for.” (Cohen at 3:49-52).
`Cohen discloses that the transaction code could be
`limited to a single merchant: “The card could even [be]
`customized for use in a particular store itself...”
`(Cohen