`Patent 6,105,013
`Attorney Docket No. 140828-002USCBM
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`
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`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`JP MORGAN CHASE & CO.
`AND JP MORGAN CHASE BANK, N.A.
`Petitioner
`
`v.
`
`MAXIM INTEGRATED PRODUCTS, INC.
`Patent Owner
`____________
`
`Case CBM2014-00178
`Patent 6,105,013
`____________
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`PATENT OWNER MAXIM INTEGRATED PRODUCTS, INC.’S
`CORRECTED PRELIMINARY RESPONSE TO PETITION FOR
`COVERED BUSINESS METHOD PATENT REVIEW OF UNITED
`STATES PATENT NO. 6,105,013 PURSUANT TO 35 U.S.C. § 321, 37 C.F.R.
`§ 42.304
`
`
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`Case CBM2014-00178
`Patent 6,105,013
`Attorney Docket No. 140828-002USCBM
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`TABLE OF CONTENTS
`
`I.
`II.
`
`C.
`
`INTRODUCTION ......................................................................................... 1
`THIS RE-FILED PETITION SHOULD BE DENIED BECAUSE IT IS
`A RE-FILING OF A PETITION BARRED BY 35 U.S.C. § 325(A)(1). .. 6
`A.
`The Board Held That § 325(a)(1) Bars Initiation. ................................................... 9
`B.
`The Board’s § 325(a)(1) Bar Determination Also Applies To The Re-Filed
`Petition. .................................................................................................................. 12
`The Changed Participation Level Of Barred Petitioner Co-Constituent PNC Does
`Not Change Its Real Party-In-Interest Status. ....................................................... 14
`1.
`PNC Exerted Control Over The First And Re-Filed Petitions. ................. 15
`2.
`PNC Contributed To Both The First And Refiled Petitions. ..................... 16
`3.
`Exempting The Second Petition From § 325(a)(1) Would Open The Door
`To Easy Evasion Of The Statutory Bar. ..................................................... 20
`Even If The Bar Did Not Still Apply, The Board Should Exercise Its Discretion
`To Deny This Re-Filed Petition Under § 325(d). .................................................. 25
`Even If Initiation Were Appropriate, Petitioner’s Bolstering Of This Re-Filed
`Petition With Waived Arguments Is Not Permitted. ............................................. 26
`III. REVIEW IS BARRED BECAUSE PETITIONER FAILED TO SHOW
`THE PATENT IS A “COVERED BUSINESS METHOD” PATENT. . 27
`Petitioner Has Taken Advantage Of The Rejection Of The First Petition To
`A.
`Unfairly Try To Bolster Its Standing Arguments. ................................................. 28
`Petitioner Fails To Show That The Patent Is Not A “Patent[] For [A]
`Technological Invention[].” .................................................................................. 30
`The Claimed Subject Matter Of The Patent As A Whole Recites Novel And
`1.
`Unobvious Technological Features. .......................................................... 34
`Counsel Has Told The Court, On Petitioner’s Behalf, That The
`a.
`Patent Claimed “New” Hardware. ................................................. 34
`
`D.
`
`E.
`
`B.
`
`b.
`
`Petitioner Ignores The Claims As A Whole. ................................. 37
`
`
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`i
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`c.
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`The Intrinsic Evidence Confirms That The Patent Claims Novel
`And Unobvious Features. .............................................................. 38
`
`IV.
`
`C.
`
`2.
`
`3.
`
`The Claimed Subject Matter Solves A Technical Problem Using A
`Technical Solution. .................................................................................... 43
`The Office’s Own Official Guidance Shows That The Patent Is For
`Technological Inventions. .......................................................................... 47
`The Board Should Not Consider Petitioner’s Belated, Improperly Augmented
`Standing Arguments. ............................................................................................. 49
`IF INSTITUTION OF REVIEW WERE NOT BARRED UNDER 35
`U.S.C. § 325 AND AIA § 18, THE PETITION WOULD STILL FAIL
`TO SATISFY THE 35 U.S.C. § 324 THRESHOLD ................................ 50
`The Petition Fails To Show That Review Of Patent-Eligibility Under § 101
`A.
`Should Be Granted. ............................................................................................... 52
`1.
`The Petition Makes No Showing Of Ineligible Subject Matter. ................. 52
`a.
`The Claims Are Not Drawn To Abstract Ideas. ............................ 53
`
`b.
`
`Even If The Claims Were Drawn To An Abstract Idea, The Claim
`Elements Transform The Nature Of The Claim Into A Patent-
`Eligible Application. ...................................................................... 58
`
`2.
`
`The Board Lacks Authority To Review The Patent-In-Suit Under Section
`101 In This Proceeding. ............................................................................ 61
`Petitioner Fails To Set Forth A Prima Facie Case Of Obviousness. ..................... 65
`B.
`V. CONCLUSION ............................................................................................ 65
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`TABLE OF AUTHORITIES
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`
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`COURT DECISIONS
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`Page(s)
`
`Alice Corp. Pty. Ltd. v. CLS Bank International,
`573 U.S. ___, 134 S. Ct. 2347 (2014) ............................ 53, 54, 57, 58, 59, 60, 61
`
`Bilski v. Kappos,
`561 U.S. 593 (2010) ..................................................................................... 54, 57
`
`Diamond v. Chakrabarty,
`447 U.S. 303 (1980) ........................................................................................... 54
`
`Mayo Collaborative Servs. v. Prometheus Labs., Inc.,
`132 S. Ct. 1289 (2012) ........................................................................... 53, 55, 60
`
`MySpace, Inc. v. GraphOn Corp.,
`672 F.3d 1250 (Fed. Cir. 2012) .................................................................... 63, 64
`
`
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`ADMINISTRATIVE DECISIONS
`
`Bloomberg Inc., et al. v. Markets-Alert PTY LTD.,
`Case No. CBM2013-00005 Paper No. 18 (P.T.A.B. Mar. 29, 2013) (per
`Medley, APJ) ............................................................................................... 42, 43
`
`Conopco, Inc. v. Procter & Gamble Co.,
`Case No. IPR2014-00507, Paper No. 17 (P.T.A.B. Jul, 7, 2014) (per Obermann,
`ALJ) .................................................................................................. 25, 26, 27, 50
`
`Customplay, LLC v. Clearplay, Inc.,
`Case No. IPR2014-00783, Paper No. 9 (P.T.A.B. Nov. 7, 2014) (per Grossman,
`ALJ) ........................................................................................................ 25, 26, 50
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`E*Trade Fin. Corp. v. Droplets, Inc.,
`Case No. CBM2014-00123, Paper No. 15 (P.T.A.B. Oct. 30, 2014) (per
`Gaudette, APJ) ................................................................................. 34, 38, 41, 43
`
`First Data Corp. v. Cardsoft, LLC,
`Case No. IPR2014-00715, Paper No. 9 (P.T.A.B. Oct. 17, 2014)
`(per curiam) ............................................................................................ 18, 19, 20
`
`Google Inc. v. Unwired Planet, LLC,
`Case No. CBM2014-00005, Paper No. 10 (P.T.A.B. Apr. 8, 2014) .................. 50
`
`Groupon, Inc. v. Blue Calypso, LLC,
`Case No. CBM2013-00033 Paper No. 10 (P.T.A.B. Dec. 19, 2013) (per Benoit,
`APJ) .................................................................................................................... 42
`
`Interthinx, Inc. v. Corelogic Solutions, LLC,
`Case No. CBM2012-00007 Paper No. 15 (P.T.A.B. Jan. 31, 2013) (per
`McNamara, APJ) ................................................................................................ 42
`
`Liberty Mutual Insurance Co. v. Progressive Casualty Insurance Co.,
`Case No. CBM2012-00003 Paper No. 15 (P.T.A.B. Feb. 12, 2013)
`(per Lee, APJ.) ................................................................................................... 41
`
`Medtronic, Inc. v. Nuvasive, Inc.,
`Case No. IPR2014-00487, Paper No. 8 (P.T.A.B. Sep. 11, 2014)
`(per Green, APJ) ................................................................................................. 50
`
`Motorola Mobility LLC v. Intellectual Ventures I LLC,
`Case No. CBM2014-00083, Paper No. 17 (P.T.A.B. Aug. 6, 2014) (per
`Kokoski, APJ) ........................................................................................ 31, 38, 42
`
`PNC Bank, N.A., JP Morgan Chase & Co. and JP Morgan Chase Bank, N.A. v.
`Maxim Integrated Prods., Inc., Case No. CBM2014-00038, Paper No. 19
`(P.T.A.B. Jun. 3, 2014) (per Weatherly, APJ) ............................................ passim
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`PNC Bank Nat’l Assoc. v. Secure Axcess, LLC,
`Case No. CBM2014-00100 Paper No. 10 (P.T.A.B. Sep. 9, 2014)
`(per Benoit, APJ) .................................................................................... 53, 56, 57
`
`Reloaded Games, Inc. v. Parallel Networks LLC,
`Case No. IPR2014-00950, Paper No. 12 (P.T.A.B. Oct. 22, 2014)
`(per Jung, APJ) ............................................................................................. 25, 28
`
`RPX Corp. v. Virnetx Inc.,
`Case No. IPR2014-00171, Paper No. 49 (P.T.A.B. Jun. 5, 2014)
`(per Easthom, J.) ................................................................................................ 24
`
`Salesforce.com, Inc. v. VirtualAgility, Inc.,
`Case No. CBM2013-00024 Paper No. 16 (P.T.A.B. Nov. 19, 2013) (per
`Braden, APJ) ...................................................................................................... 42
`
`
`
`STATUTES AND RULES
`
`Leahy-Smith America Invents Act,
`Pub. L. No. 112-29, 125 Stat. 284 (2011), § 18 ............................... 30, 31, 62, 64
`
`35 U.S.C. § 101 ....................................................................................... 5, 54, 61, 63
`
`35 U.S.C. § 102 ................................................................................................. 62, 63
`
`35 U.S.C. § 103 ................................................................................................. 62, 63
`
`35 U.S.C. § 112 ....................................................................................................... 62
`
`35 U.S.C. § 251 ....................................................................................................... 62
`
`35 U.S.C. § 282 ....................................................................................................... 62
`
`35 U.S.C. § 312 ..................................................................................................... 4, 9
`
`35 U.S.C. § 321 ....................................................................................................... 62
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`35 U.S.C. § 323 ................................................................................................... 1, 52
`
`35 U.S.C. § 324 ................................................................................................. 51, 53
`
`35 U.S.C. § 325 ................................................................................................ passim
`
`35 U.S.C. § 326 ....................................................................................................... 53
`
`
`
`REGULATIONS
`
`Changes to Implement Inter Partes Review Proceedings, Post-Grant Review
`Proceedings, and Transitional Program for Covered Business Method Patents;
`Final Rule, 77 Fed. Reg. 48,680 (Aug. 14, 2012) (codified at C.F.R. tit. 37, ch.
`1) ........................................................................................................................ 31, 52
`
`Transitional Program for Covered Business Method Patents—Definitions of
`Covered Business Method Patent and Technological Invention; Final Rule, 77 Fed.
`Reg. 48,734 (Aug. 14, 2012) (codified at C.F.R. tit. 37, ch. 1) ................... 30, 32, 45
`
`Office Patent Trial Practice Guide; Rule, 77 Fed. Reg. 48,756 (Aug. 14, 2012) (to
`be codified at C.F.R. pt. 42) ........................................................................ 31, 48, 52
`
`37 C.F.R. § 42.207 .............................................................................................. 1, 52
`
`37 C.F.R. § 42.208 .................................................................................................... 1
`
`37 C.F.R. § 42.301 ................................................................................ 31, 32, 34, 42
`
`37 C.F.R. § 42.304 ............................................................................................ 31, 40
`
`
`
`LEGISLATIVE HISTORY
`
`Leahy-Smith America Invents Act,
`157 Cong. Rec. S5428 (daily ed. Sept. 8, 2011) ................................................ 24
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`Leahy-Smith America Invents Act,
`157 Cong. Rec. 1363, 1364 (daily ed. Mar. 8, 2011) ......................................... 42
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`EXHIBIT LIST
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`Exhibit 2001
`
`Hearing Transcript, In re Maxim Integrated Products,
`Inc., Misc. No. 12-244 (MDL No. 2354) (W.D. Pa.
`Mar. 20, 2013) (excerpt)
`
`Exhibit 2002
`
`2010-12-30 Notice of Allowance and Fees Due
`Application No. 10/415,022
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`Mail Stop PATENT BOARD
`Patent Trial and Appeal Board
`U.S. Patent & Trademark Office
`P.O. Box 1450
`Alexandria, Virginia 22313-1450
`
`
`Pursuant to 35 U.S.C. § 323, America Invents Act of 2011 (“AIA”)
`
`§ 18(a)(1), and 37 C.F.R. §§ 42.207-208, the undersigned, on behalf of and acting
`
`in a representative capacity for patent owner, Maxim Integrated Products, Inc.
`
`(“Patent Owner” or “Maxim”), submits the following Preliminary Response to the
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`Petition (“Second Petition”) for covered business method (“CBM”) patent review
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`filed in the above-captioned proceeding by JP Morgan Chase & Co. and JP
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`Morgan Chase Bank, N.A. (collectively, “Chase” or “Petitioner”) against United
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`States Patent No. 6,105,013 (“the ’013 patent” or “the Patent”).
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`I.
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`INTRODUCTION
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`When the first version of this petition was filed, PNC Bank, N.A. (“PNC”)
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`and Chase prepared and filed it acting as one. PNC Bank, N.A., JP Morgan Chase
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`& Co. and JP Morgan Chase Bank, N.A. v. Maxim Integrated Prods., Inc., No.
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`CBM2014-00040, Paper 3, at i, 1. The Board ruled that, because PNC had
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`previously filed a civil action challenging the validity of the Patent, initiation was
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`barred under 35 U.S.C. § 325(a)(1). Id., Paper 19, slip op. at 3 (P.T.A.B. Jun. 3,
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`2014) (per Weatherly, APJ).
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`Chase now re-files the petition, claiming it is acting alone and that PNC is
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`no longer a real party-in-interest because PNC did not overtly participate in the re-
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`filing. Chase asserts that this change erases the § 325(a)(1) statutory bar. Chase
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`also took advantage of the earlier denial under that statutory bar to rearrange,
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`bolster and rewrite the petition, in an attempt to fix flaws that were pointed out last
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`time by Patent Owner and the Board.
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`Chase’s re-filed petition should be denied for four independent reasons.
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`First, the § 325(a)(1) bar and the Board’s prior order continue to govern.
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`The language of § 325(a)(1) is clear: once a petitioner or real party in interest files
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`a civil action challenging the validity of the patent, a covered business method
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`patent review may not be instituted. The Board already held that the bar is in
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`effect because PNC, Chase’s co-real party-in-interest, filed a prior action
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`challenging the Patent’s validity. PNC Bank, CBM2014-00041, Paper 19 at 3. As
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`a result, a petition challenging the Patent may not be instituted because PNC
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`remains a real party-in-interest—regardless whether Petitioner included PNC as a
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`constituent, and regardless whether PNC ceased participating in the petition. Id. at
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`3-4. Under § 325(a)(1)’s plain language and the Board’s earlier determination
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`denying the petition, a change in PNC’s participation level, or a re-filing claiming
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`that Chase is now the lone Petitioner constituent and lone real party-in-interest,
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`cannot change the bar already in effect.
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`Second, even if changes to these facts could change the already-adjudicated
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`application of the § 325(a)(1) bar, on the facts here the bar would still apply. The
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`plan for Chase to “re-file” PNC’s and Chase’s joint Petition was hatched (and
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`detailed in a joint PNC/Chase motion) even before the petition was first denied—
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`when PNC and Chase were still formally acting together as Petitioner, and still
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`jointly urging the Board to reconstitute the Petitioner and change the named real
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`parties-in-interest in an attempt to get around the bar. PNC Bank, CBM2014-
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`00040, Paper 11 (joint PNC/Chase Motion for Adverse Judgment Against PNC) at
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`5; id., Paper 19, at 4 (order denying joint motion as moot). Even though Chase
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`“re-filed” the petition a few weeks after it was ruled to be barred—consistent with
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`what both PNC and Chase said was the plan all along—PNC’s prior control and
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`contributions remain throughout the petition. Arguments and prior art included in
`
`the original petition co-funded and co-prepared by PNC remain in the Second
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`Petition. The expert declarant is the same as in two of the other barred petitions
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`Chase co-filed against related patents. All Chase has done is re-edit the petition
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`and change the expert declaration in an unfair attempt to bolster it and fix the other
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`flaws identified last time—without, however, substantially changing the overall
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`petition already presented. Furthermore, to allow this re-edited Petition to escape
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`the statutory bar would open the door wide to evasion of § 325(a)(1), for it would
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`allow barred persons to use simple strategies to contribute to petitions, filed with
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`the aid of nominally non-barred helpers—and even to gain an advantage from
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`having their petitions barred, because they could then be bolstered, re-edited and
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`re-filed after the patent owner was obliged to reveal its rebuttal arguments. For all
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`these reasons, PNC remains a real party-in-interest, and the § 325(a)(1) bar applies.
`
`(Indeed, because the petition fails to identify a real party-in-interest, initiation of
`
`review is also barred under 35 U.S.C. § 312(a)(2).)
`
`Third, even if PNC’s contributions and control were not enough to bar the
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`re-filed petition, the Board should still exercise its broad discretion to “reject the
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`petition because[] the same or substantially the same prior art arguments
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`previously were presented to the Office,” and to prevent evasion of the statutory
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`bar and unjust burden on patent owners and the Board as described above. 35
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`U.S.C. § 325(d). Chase’s re-edit does not substantially change the overall petition,
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`and to the extent it changes “prior art arguments,” they remain substantially similar
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`to arguments that were either already in the petition or were presented in at least
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`one of the four inter-related petitions against related patents, including this Patent,
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`that the Board rejected the first time under § 325(a)(1). PNC Bank, CBM2014-
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`00038, -00039, -00040, -00041. The Board should further apply its discretion
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`under § 325(d) to not consider the “improvements” that Chase improperly adds
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`throughout the re-filed petition (using Patent Owner’s and the Board’s rebuttals to
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`the first petition as a “how-to guide”) in an attempt to bolster its arguments since
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`the first time the petition was denied.
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`Fourth, the petition must also be denied because the patent cannot be shown
`
`to be a “covered business method” patent eligible for Transitional Program review.
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`Chase does not show that the patent is drawn to financial products or services but
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`is not a patent for technological inventions.
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`Finally, even if the petition were not ineligible for institution of review,
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`Chase fails to show a likelihood that any challenged claims are ineligible for
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`patenting under 35 U.S.C. § 101.
`
`For all these reasons, the Board should deny institution of review, as it did
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`the first time.1
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`1 As detailed below, this Petition was re-filed along with three other Petitions
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`challenging three related patents, in case Nos. CBM2014-00177, -00179 and -
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`00180. Although the Board will naturally address the four cases in whatever way
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`it finds best, if it wishes to address them together for any reason, it is respectfully
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`II. THIS RE-FILED PETITION SHOULD BE DENIED BECAUSE IT IS
`A RE-FILING OF A PETITION BARRED BY 35 U.S.C. § 325(A)(1).
`
`This petition (the “Second Petition”) is the second that Petitioner Chase has
`
`filed as petitioner or co-petitioner for review of this Patent. Previously, Chase and
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`PNC, acting together as Petitioner and co-real parties-in-interest, jointly filed a first
`
`petition (the “First Petition”) against this Patent. Similarly, they also filed first
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`petitions against three other patents sharing the same or related specifications and
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`asserted with the Patent against Chase in pending litigation.2 The Board denied the
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`first petitions against all four patents (including the First Petition against this
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`
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`suggested that the Board may find it easiest to begin its review with the filings in
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`case No. CBM2014-00179, which has the longest Preliminary Response.
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`2 The four patents are U.S. Pat. Nos. 5,940,510, 5,949,880, 6,105,013 (the
`
`“Patent”), and 6,237,095. Except for the ’880 patent, these patents all continue to
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`be asserted in the litigation against Chase.
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`Patent) because PNC previously filed a civil action challenging the validity of the
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`claims of the Patent, and 35 U.S.C. § 325(a)(1) precluded institution of review.3
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`Petitioner does not seriously dispute that the second petitions (including this
`
`one) are merely re-edited versions of the first petitions that raise the same or
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`substantially similar arguments. For example, the Second Petition is supported by
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`the same expert declarant as two of the other first petitions, challenges all the
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`claims that were challenged in the First Petition, raises §§ 101 and 103 grounds
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`like the First Petition, and relies exclusively on prior art references that were raised
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`in the First Petition (primary reference Hawkes, and secondary references
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`Lancaster (or “Hardware Hacker”) and Blandford).
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`Petitioner, hoping to avoid the § 325(a)(1) statutory bar this time, no longer
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`names PNC as a petitioner constituent or real party-in-interest. Nevertheless,
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`§ 325(a)(1) still bars initiation. The Board already held that § 325(a)(1)’s bar
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`applied when PNC and Chase co-filed the First Petition. That is all that is needed
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`3 PNC Bank N.A., JP Morgan Chase & Co. and JP Morgan Chase Bank, N.A. v.
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`Maxim Integrated Prods., Inc., No. CBM2014-00038, -00039, -00040 (against the
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`Patent) & -00041, Paper No. 19 (P.T.A.B. Jun. 3, 2014) (per Weatherly, APJ).
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`to establish that Chase’s re-filing of substantially the same petition, against the
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`same patent, is also barred.
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`Chase argues that the § 325(a)(1) bar no longer applies because PNC did not
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`participate in or control “the filing of this [Second] Petition” and has settled Patent
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`Owner’s claims against it, and so is no longer a “real party-in-interest.” 2nd Pet. at
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`2. That PNC’s level of ongoing participation has changed between the first filing
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`and re-filing of the petition makes no difference under the statute. Moreover, the
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`Board has already held that PNC cannot change its real party-in-interest status by
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`settling with Patent Owner or ceasing its further participation in challenging the
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`Patent. PNC Bank, CBM2014-00038, Paper 19 at 4. Indeed, PNC and Chase
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`jointly told the Board in a Motion related to the First Petitions that Chase alone
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`would file Second Petitions if PNC were barred. Id, Paper 11 at 3, 5.
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`Even if new facts could theoretically have changed PNC’s real party-in-
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`interest status with respect to the Second Petition, they have not done so here. The
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`First Petition is substantially similar to the re-filed Second Petition, and PNC’s
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`barred contributions to the First Petition are also contributions to the Second
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`Petition. The Second Petition challenges all the claims challenged in the First
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`Petition, and Chase filed or co-filed both petitions. Perhaps more importantly,
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`Chase and PNC were collaborating when the petition was drafted and the strategy
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`to re-file it was decided. This is distinct from other possible situations such as, for
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`example, where an unrelated third party simply takes the PNC/Chase petition and
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`decides to file it. Chase cannot undo its collaboration with PNC by simply
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`removing PNC from a list of real parties in interest, while still relying on the prior
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`contributions and strategy.
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`PNC remains a real party-in-interest, and
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`initiation of review
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`is,
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`consequently, barred under 35 U.S.C. § 325(a)(1). Moreover, PNC is not
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`identified as a real party-in-interest, and initiation of review is therefore also barred
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`under 35 U.S.C. § 312(a)(2).
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`Finally, even if initiation were not statutorily barred, the Board should
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`exercise its discretion to deny review under § 325(d) because the same or
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`substantially the same prior art or arguments previously were presented to the
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`Office in the First Petition, and the Second Petition functions as nothing more than
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`a successive pleading, unfairly taking advantage of Patent Owner’s rebuttals to add
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`bolstering arguments that could and should have been raised in the First Petition.
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`A. The Board Held That § 325(a)(1) Bars Initiation.
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`It is helpful to recount some salient facts that led up to the filing of
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`Petitioner’s second petitions against these patents.
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`Chase and PNC jointly controlled, prepared and funded the first round of
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`petitions, were represented by common counsel in preparing and asserting them,
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`and were both members of a joint defense agreement with respect to the four
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`patents. See, e.g., PNC Bank, CBM2014-00040, Paper 7 (patent owner
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`preliminary response) at 31-33 (Mar. 6, 2014); 2nd Pet. at 2 (admitting that Chase
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`and PNC’s common counsel “prepared the [First] Petition”), 3 (admitting that
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`Chase and PNC were “co-signatories to [a] joint defense agreement with respect to
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`the [Patent]”).
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`After Chase and PNC filed their first petitions, Patent Owner filed
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`Preliminary Responses to those petitions (id.) (the “First Preliminary Response” or
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`“1st POPR”). In its First Preliminary Reponses, Patent Owner explained why
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`§ 325(a)(1) would continue to bar institution of review even if PNC were to
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`“forswear all further control and participation in this case.” Id. at 30-34. Also,
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`since Patent Owner could not absolutely guarantee that the Board would agree that
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`§ 325(a)(1) barred initiation, it was obliged to set forth further arguments, refuting
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`the First Petition’s flawed positions on standing and the merits. Id. at 34-59.
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`After Chase and PNC reviewed Patent Owner’s First Preliminary Response
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`to the First Petition, they filed through their common counsel a joint Motion for
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`Adverse Judgment against PNC. Id., Paper 11 (Apr. 1, 2014). Chase and PNC
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`jointly stated that PNC had settled its litigation against Patent Owner and would
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`“expressly abandon . . . and no longer participate” in the First Petition. Id. at 3. In
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`addition, seeking to dissuade the Board from denying the motion or denying
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`institution of the First Petition, they jointly explained that “if the Board . . . denies
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`the [First Petition] because PNC was a DJ plaintiff, then [Chase] will re-file the
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`CBM petition[].” Id. at 5. Later, Chase and PNC jointly notified the Board that
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`PNC had settled Patent Owner’s litigation claims against it. Id., Paper 19 at 4.
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`When the Board denied initiation of the First Petition, it denied Chase’s and
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`PNC’s Motion for Adverse Judgment against PNC as moot. Id. The Board noted
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`that granting the request for adverse judgment “would not obviate the control that
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`PNC has already exerted in this proceeding by its filing of the Petition” with
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`Chase, for, despite PNC’s settlement and agreement to have no further part, “PNC
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`has already exerted substantial control over the case.” Id.
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`Less than three months later, Petitioner Chase “re-file[d] the CBM petition”
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`as the Second Petition here, and also re-filed its petitions against the other three
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`related patents—exactly as Chase and PNC’s joint motion had said was the plan all
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`along. Id., Paper 11 at 5. The second petitions rearrange the alleged prior art and
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`grounds of unpatentability somewhat compared to their arrangement in the first
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`petitions, and add and bolster arguments in response to arguments raised against
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`the first petitions before review was denied. Nonetheless, as noted above (supra at
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`6), the second petitions raise the same or substantially similar arguments against
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`each patent as the first petitions.
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`The Second Petition asserts that PNC “has settled the controversy with
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`Patent Owner over the validity of the subject patent and the civil litigation between
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`PNC and Patent Owner has been dismissed.” 2nd Pet. at 2. However, PNC’s and
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`Chase’s joint motion for adverse judgment against PNC as to the First Petition had
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`already told the Board that PNC had settled its controversy with Patent Owner, and
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`the Board had still denied PNC’s and Chase’s joint motion as moot and denied
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`institution of the First Petition as barred under § 325(a)(1). PNC Bank, CBM2014-
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`00040, Paper 19 at 3-4.
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`B.
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`The Board’s § 325(a)(1) Bar Determination Also Applies To The
`Re-Filed Petition.
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`Despite the fact that the Second Petition is just a re-filing of a re-edited
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`version of the First Petition, Petitioner, hoping to avoid the § 325(a)(1) bar this
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`time, no longer names PNC as a petitioner constituent or real party-in-interest in
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`the second set of petitions. Nevertheless, the plain language of § 325(a)(1) still
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`bars initiation.
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`Section 325(a)(1) provides that a covered business method patent review
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`“may not be instituted under this chapter if, before the date on which the petition
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`for such a review is filed, the petitioner or real party in interest filed a civil action
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`challenging the validity of a claim of the patent” (emphasis added). The statute is
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`clear. Once a petitioner or real party in interest files a civil action challenging the
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`validity of the patent, a covered business method patent review may not be
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`instituted. Here, the Board has already held that the statutory bar has taken effect,
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`because PNC, a real party-in-interest, had already filed a declaratory judgment
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`action challenging the validity of the patent. PNC Bank, CBM2014-00040, Paper
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`19 at 3. As a result, a petition challenging the patent filed by Chase, with PNC as a
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`real party in interest, cannot be instituted.
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`Contra