`Tel: 571-272-7822
`
`Paper 7
`Entered: April 2, 2015
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`SAMSUNG ELECTRONICS AMERICA, INC. and
`SAMSUNG ELECTRONICS CO., LTD.,
`Petitioner,
`
`v.
`
`SMARTFLASH LLC,
`Patent Owner.
`
`Case CBM2014-00193
`Patent 8,061,598 B2
`
`
`
`
`
`
`
`
`
`Before JENNIFER S. BISK, RAMA G. ELLURU, GREGG I. ANDERSON,
`MATTHEW R. CLEMENTS, and PETER P. CHEN,
`Administrative Patent Judges.
`
`CLEMENTS, Administrative Patent Judge.
`
`DECISION
`Institution of Covered Business Method Patent Review
`37 C.F.R. § 42.208
`
`
`
`
`
`CBM2014-00193
`Patent 8,061,598 B2
`
`INTRODUCTION
`
`A. Background
`Samsung Electronics America, Inc. and Samsung Electronics Co.,
`Ltd. (“Petitioner”)1 filed a Petition requesting covered business method
`patent review of claim 7 (the “challenged claim”) of U.S. Patent No.
`8,061,598 (Ex. 1001, “the ’598 patent”) pursuant to § 18 of the Leahy-Smith
`America Invents Act (“AIA”).2 Paper 2 (“Pet.”). Smartflash LLC (“Patent
`Owner”) filed a Preliminary Response. Paper 5 (“Prelim. Resp.”).
`We have jurisdiction under 35 U.S.C. § 324, which provides that a
`covered business method patent review may not be instituted “unless . . . it is
`more likely than not that at least 1 of the claims challenged in the petition is
`unpatentable.”
`After considering the Petition and Preliminary Response, we
`determine that the ’598 patent is a covered business method patent and that
`Petitioner has demonstrated that it is more likely than not that the challenged
`claim is unpatentable. Accordingly, we institute a covered business method
`patent review of claim 7 of the ’598 patent.
`
`B. Asserted Grounds
`Petitioner contends that the challenged claim is unpatentable under
`35 U.S.C. §§ 101 and/or 103 in view of Stefik ’235,3 Stefik ’980,4 and
`
`
`1 Samsung Telecommunications America, LLC is listed as a real party-in-
`interest in the Petition, but merged with and into Samsung Electronics
`America, Inc., after the filing of the Petition. Paper 6, 1.
`2 Pub. L. No. 112-29, 125 Stat. 284, 296–07 (2011)
`3 U.S. Patent No. 5,530,235 (Ex. 1013) (“Stefik ’235”)
`4 U.S. Patent No. 5,629,980 (Ex. 1014) (“Stefik ’980”)
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`2
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`CBM2014-00193
`Patent 8,061,598 B2
`Gruse.5 Pet. 3. Petitioner also provides a declaration from Jeffrey A.
`Bloom, Ph.D (“the Bloom Declaration”). Ex. 1003.
`
`C. Related Matters
`The parties indicate that the ’598 patent is the subject of the following
`district court cases: Smartflash LLC v. Apple Inc., Case No. 6:13-cv-447
`(E.D. Tex.); Smartflash LLC v. Samsung Electronics Co., Case No. 6:13-cv-
`448 (E.D. Tex.). Pet. 1; Paper 4, 2-3. Patent Owner also indicates that the
`’598 patent is the subject of a third district court case: Smartflash LLC v.
`Google, Inc., Case No. 6:14-cv-435 (E.D. Tex.). Paper 4, 3. Related patents
`claiming priority back to a common series of applications currently are the
`subject of CBM2014-00102, CBM2014-00106, CBM2014-00108, and
`CBM2014-00112, filed by Apple Inc. See Paper 4, 2–3.
`Petitioner filed a concurrent petition for covered business method
`patent review of the ’598 patent: CBM2014-00198 (“the 198 Petition”).6 In
`addition, Petitioner filed eight other Petitions for covered business method
`patent review challenging claims of patents owned by Patent Owner and
`disclosing similar subject matter: CBM2014-00190; CBM2014-00192;
`CBM2014-00194; CBM2014-00196; CBM2014-00197; CBM2014-00199;
`CBM2014-00200; and CBM2014-00204.
`
`
`5 PCT Publication No. WO 00/08909 (Ex. 1006) (“Gruse”)
`6 Patent Owner argues that the multiple petitions filed against the ’598 patent
`violate the page limit requirement of 37 C.F.R. § 42.24(a)(iii), but does not
`cite any authority to support its position. Prelim. Resp. 9–12. The page
`limit for a petition requesting covered business method patent review is 80
`pages (37 C.F.R. § 42.24(a)(iii)), and each of this Petition and the 198
`Petition meets that requirement.
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`3
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`Patent 8,061,598 B2
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`D. The ’598 Patent
`The ’598 patent relates to “a portable data carrier for storing and
`paying for data and to computer systems for providing access to data to be
`stored” and the “corresponding methods and computer programs.”
`Ex. 1001, 1:21–25. Owners of proprietary data, especially audio recordings,
`have an urgent need to address the prevalence of “data pirates” who make
`proprietary data available over the internet without authorization. Id. at
`1:29–55. The ’598 patent describes providing portable data storage together
`with a means for conditioning access to that data upon validated payment.
`Id. at 1:59–2:11. This combination allows data owners to make their data
`available over the internet without fear of data pirates. Id. at 2:11–15.
`As described, the portable data storage device is connected to a
`terminal for internet access. Id. at 1:59–67. The terminal reads payment
`information, validates that information, and downloads data into the portable
`storage device from a data supplier. Id. The data on the portable storage
`device can be retrieved and output from a mobile device. Id. at 2:1–5. The
`’598 patent makes clear that the actual implementation of these components
`is not critical, and the alleged invention may be implemented in many ways.
`See, e.g., id. at 25:49–52 (“The skilled person will understand that many
`variants to the system are possible and the invention is not limited to the
`described embodiments.”).
`
`E. Challenged Claim
`Petitioner challenges claim 7 of the ’598 patent. Claim 7 depends
`from claim 1. Claims 1 and 7 recite the following:
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`4
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`Patent 8,061,598 B2
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`1.
`A portable data carrier comprising:
`an interface for reading and writing data from and to the portable data
`carrier;
`content data memory, coupled to the interface, for storing one or more
`content data items on the carrier;
`use rule memory to store one or more use rules for said one or more
`content data items;
`a program store storing code implementable by a processor;
`and a processor coupled to the content data memory, the use rule
`memory, the interface and to the program store for implementing
`code in the program store,
`wherein the code comprises code for storing at least one content data
`item in the content data memory and at least one use rule in the use
`rule memory.
`Ex. 1001, 25:54–67.
`
`A portable data carrier as claimed in claim 1, further
`7.
`comprising payment data memory to store payment data and code to
`provide the payment data to a payment validation system.
`Id. at 26:25–28.
`
`ANALYSIS
`A. Claim Construction
`In a covered business method patent review, claim terms are given
`their broadest reasonable interpretation in light of the specification in which
`they appear and the understanding of others skilled in the relevant art. See
`37 C.F.R. § 42.300(b); see also In re Cuozzo Speed Techs., LLC, No. 2014-
`1301, 2015 WL 448667, at *7 (Fed. Cir. Feb. 4, 2015) (“We conclude that
`Congress implicitly adopted the broadest reasonable interpretation standard
`in enacting the AIA.”). Applying that standard, we interpret the claim terms
`of the ’598 patent according to their ordinary and customary meaning in the
`context of the patent’s written description. See In re Translogic Tech., Inc.,
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`504 F.3d 1249, 1257 (Fed. Cir. 2007). For purposes of this decision, we
`construe the claim term “use rule.”
`The term “use rule” is recited in independent claim 1. Neither party
`proposes a construction of “use rule.” The ’598 patent describes “use rules”
`as “for controlling access to the stored content” (Ex. 1001, Abstract) and as
`“indicating permissible use of data stored on the carrier” (id. at 9:14-16).
`The ’598 patent also describes “evaluating the use status data using the use
`rules to determine whether access to the stored data is permitted.” Id. at
`6:38-40; see also id. at 21:48-53 (“[E]ach content data item has an
`associated use rule to specify under what conditions a user of the smart Flash
`card is allowed access to the content data item.”). Accordingly, for purposes
`of this decision, we construe “use rule” as “a rule specifying a condition
`under which access to content is permitted.”
`
`B. Covered Business Method Patent
`Section 18 of the AIA provides for the creation of a transitional
`program for reviewing covered business method patents. A “covered
`business method patent” is a patent that “claims a method or corresponding
`apparatus for performing data processing or other operations used in the
`practice, administration, or management of a financial product or service,
`except that the term does not include patents for technological inventions.”
`AIA § 18(d)(1); see 37 C.F.R. § 42.301(a). A patent need have only one
`claim directed to a covered business method to be eligible for review. See
`Transitional Program for Covered Business Method Patents—Definitions of
`Covered Business Method Patent and Technological Invention; Final Rule,
`77 Fed. Reg. 48,734, 48,736 (Aug. 14, 2012) (“CBM Rules”) (Comment 8).
`
`6
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`Patent 8,061,598 B2
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`1. Financial Product or Service
`Petitioner asserts that “the purported data carrier and payment
`validation system of claim 7 unquestionably are used for data processing in
`the practice, administration and management of financial products and
`services; specifically, for processing payments for data downloads.” Pet. 8.
`Based on this record, we agree with Petitioner that the subject matter recited
`by claim 7 is directed to activities that are financial in nature, namely data
`access conditioned on payment validation. Claim 7 recites “payment data
`memory to store payment data and code to provide the payment data to a
`payment validation system.” We are persuaded that payment validation is a
`financial activity, and conditioning data access based on payment validation
`amounts to a financial service. This is consistent with the Specification of
`the ’598 patent, which confirms claim 7’s connection to financial activities
`by stating that the invention “relates to a portable data carrier for storing and
`paying for data.” Ex. 1001, 1:21–23. The Specification also states
`repeatedly that the disclosed invention involves managing access to data
`based on payment validation. See, e.g., Ex. 1001, 1:59–67; 6:60–64; 20:50–
`54.
`
`Patent Owner disagrees that Claim 7 satisfies the financial-in-nature
`requirement of AIA § 18(d)(1), arguing that the section should be interpreted
`narrowly to cover only technology used specifically in the financial or
`banking industry. Prelim. Resp. 3–7. Patent Owner cites to various portions
`of the legislative history as support for its proposed interpretation. Id.
`Although we agree with Patent Owner that the statutory language
`controls whether a patent is eligible for a covered business method patent
`review, we do not agree that the phrase “financial product or service” is as
`
`7
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`Patent 8,061,598 B2
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`limited as Patent Owner proposes. The AIA does not include as a
`prerequisite for covered business method patent review, a “nexus” to a
`“financial business,” but rather a “method or corresponding apparatus for
`performing data processing or other operations used in the practice,
`administration, or management of a financial product or service.” AIA
`§ 18(d)(1). Further, contrary to Patent Owner’s view of the legislative
`history, the legislative history indicates that the phrase “financial product or
`service” is not limited to the products or services of the “financial services
`industry,” and is to be interpreted broadly. CBM Rules, 77 Fed. Reg. at
`48,735-36. For example, the “legislative history explains that the definition
`of covered business method patent was drafted to encompass patents
`‘claiming activities that are financial in nature, incidental to a financial
`activity or complementary to a financial activity.’” Id. (citing 157 Cong.
`Rec. S5432 (daily ed. Sept. 8, 2011) (statement of Sen. Schumer)).
`In addition, Patent Owner asserts that claim 7 is not directed to an
`apparatus or method that is financial in nature because claim 7 “omits the
`specifics of how payment is made.” Prelim. Resp. 7. We are not persuaded
`by this argument because § 18(d)(1) of the AIA does not include such a
`requirement, nor does Patent Owner point to any other authority that makes
`such a requirement. Prelim. Resp. 7. We determine that because payment is
`required by claim 7, as Patent Owner acknowledges, the financial in nature
`requirement of § 18(d)(1) is satisfied.
`For the reasons stated above, and based on the particular facts of this
`proceeding, we conclude that the ’598 patent includes at least one claim that
`meets the financial in nature requirement of § 18(d)(1) of the AIA.
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`8
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`2. Exclusion for Technological Inventions
`Petitioner asserts that claim 7 does not fall within § 18(d)(1)’s
`exclusion for “technological inventions.” Pet. 10–12. In particular,
`Petitioner argues that claim 7 does not recite a technological feature that is
`novel and unobvious, or solve a technical problem using a technical solution.
`Id. Patent Owner disagrees and argues that claim 7, as a whole, recites at
`least one technological feature that is novel and unobvious over the prior art.
`Prelim. Resp. 8–9.
`We are persuaded that claim 7 as a whole does not recite a
`technological feature that is novel and unobvious over the prior art. For
`example, claim 1, on which claim 7 depends, recites only limitations such as
`“interface,” “content data memory,” “use rule memory,” “program store,”
`“processor,” “code for storing,” and “code to provide” data, which are not
`novel and unobvious. Claim 7 also recites a “payment validation system.”
`The Specification, however, discloses that the required payment validation
`system may be one that is already in use or otherwise commercially
`available. For example, “[t]he payment validation system may be part of the
`data supplier’s computer systems or it may be a separate e-payment system.”
`Ex. 1001, 8:63–65; see id. at 13:35–47.
`In addition, the ’598 patent makes clear that the asserted novelty of
`the invention is not in any specific improvement of software or hardware,
`but in the method of controlling access to data. For example, the ’598 patent
`states that “there is an urgent need to find a way to address the problem of
`data piracy” (id. at 1:52–55), while acknowledging that the “physical
`embodiment of the system is not critical and a skilled person will understand
`that the terminals, data processing systems and the like can all take a variety
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`of forms” (id. at 12:29–32). Thus, we determine that claim 7 is merely the
`recitation of a combination of known technologies, which indicates that it is
`not a patent for a technological invention. See Office Patent Trial Practice
`Guide, 77 Fed. Reg. 48,756, 48,764 (Aug. 14, 2012).
`Patent Owner also argues that claim 7 falls within § 18(d)(1)’s
`exclusion for “technological inventions” because it is directed toward
`solving the technological problem of “storing at least one content data item
`in the content data memory and at least one use rule in the use rule memory”
`with the technological solution of “code for storing at least one content data
`item in the content data memory and at least one use rule in the use rule
`memory.” Prelim. Resp. 8. We are not persuaded by this argument because,
`as Petitioner argues, the problem being solved by claim 7 is a business
`problem—data piracy. Pet. 11–12. For example, the Specification states
`that “[b]inding the data access and payment together allows the legitimate
`owners of the data to make the data available themselves over the internet
`without fear of loss of revenue, thus undermining the position of data
`pirates.” Ex. 1001, 2:11–15. Thus, based on the particular facts of this
`proceeding, we conclude that claim 7 does not recite a technological
`invention and is eligible for a covered business method patent review.
`
`3. Conclusion
`In view of the foregoing, we conclude that the ’598 patent is a covered
`business method patent under AIA § 18(d)(1) and is eligible for review
`using the transitional covered business method patent program.
`
`C. 35 U.S.C. § 101
`Petitioner challenges claim 7 as directed to patent-ineligible subject
`matter under 35 U.S.C. § 101. Pet. 20–32. Petitioner asserts that the
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`challenged claim is directed to an abstract idea without additional elements
`that transform the claims into a patent-eligible application of that idea. Id.
`Specifically, Petitioner argues that the challenged claim is directed to the
`abstract idea of “enabling limited use of paid-for/licensed content.” Pet. 23.
`Patent Owner argues that the challenged claim is directed to a more
`narrow invention than that asserted by Petitioner. Prelim. Resp. 12–13.
`Patent Owner specifically cites to the limitations “code for storing at least
`one content data item in the content data memory and at least one use rule in
`the use rule memory” and “code to provide the payment data to a payment
`validation system” as evidence that claim 7 “is not preemptory as asserted
`and is, at least for that reason, directed to statutory subject matter.” Id.
`Based on the analysis of the challenged claims using the two-step process set
`forth in Alice Corp. Pty, Ltd. v. CLS Bank International, 134 S. Ct. 2347
`(2014), as discussed below, we agree with Samsung that claim 7 of the ’598
`patent is more likely than not directed to patent-ineligible subject matter.
`Under 35 U.S.C. § 101, we must first identify whether an invention
`fits within one of the four statutorily provided categories of patent-
`eligibility: “processes, machines, manufactures, and compositions of
`matter.” Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 713–714 (Fed. Cir.
`2014). Here, the challenged claim recites a “machine,” i.e., a “portable data
`carrier,” under § 101. Section 101, however, “contains an important implicit
`exception [to subject matter eligibility]: Laws of nature, natural phenomena,
`and abstract ideas are not patentable.” Alice, 134 S. Ct. at 2354 (citing
`Assoc. for Molecular Pathology v. Myriad Genetics, Inc., 133 S. Ct. 2107,
`2116 (2013) (internal quotation marks and brackets omitted)).
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`We are persuaded that the challenged claim is more likely than not
`drawn to a patent-ineligible abstract idea. In Alice, the Supreme Court
`reiterated the framework set forth previously in Mayo Collaborative Servs.
`v. Prometheus Labs., 132 S. Ct. 1289, 1293 (2012), “for distinguishing
`patents that claim laws of nature, natural phenomena, and abstract ideas
`from those that claim patent-eligible applications of those concepts.” Alice,
`134 S. Ct. at 2355. The first step in the analysis is to “determine whether the
`claims at issue are directed to one of those patent-ineligible concepts.” Id.
`If so, the second step in the analysis is to consider the elements of the claim
`“individually and ‘as an ordered combination’” to determine whether there
`are additional elements that “‘transform the nature of the claim’ into a
`patent-eligible application.” Id. (quoting Mayo, 132 S. Ct. at 1291, 1297).
`In other words, the second step is to “search for an ‘inventive concept’—i.e.,
`an element or combination of elements that is ‘sufficient to ensure that the
`patent in practice amounts to significantly more than a patent upon the
`[ineligible concept] itself.’” Id. (brackets in original) (quoting Mayo, 132 S.
`Ct. at 1294).
`Petitioner contends that the challenged claim is directed to “the
`abstract idea of enabling limited use of paid-for/licensed content.” Pet. 23.
`As discussed above, the ’598 patent discusses addressing recording industry
`concerns of data pirates offering unauthorized access to widely available
`compressed audio recordings. Ex. 1001, 1:20–55. The ’598 patent proposes
`to solve this problem by restricting access to data on a portable data carrier
`based upon payment validation. Ex. 1001, 1:59–2:4. The ’598 patent makes
`clear that the heart of the claimed subject matter is restricting access to
`stored data based on supplier-defined access rules and validation of
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`payment. Id. at 1:59–2:15. We are persuaded, on this record, that the
`claimed “portable data carrier,” is directed to an abstract idea. See Alice,
`134 S. Ct. at 2356 (holding that the concept of intermediated settlement at
`issue in Alice was an abstract idea); Accenture Global Servs., GmbH v.
`Guidewire Software, Inc., 728 F.3d 1336, 1344 (Fed. Cir. 2013) (holding the
`abstract idea at the heart of a system claim to be “generating tasks [based on]
`rules . . . to be completed upon the occurrence of an event”).
`Turning to the second step of the analysis, we look for additional
`elements that can “transform the nature of the claim” into a patent-eligible
`application of an abstract idea. Mayo, 132 S. Ct. at 1297. On this record,
`we are not persuaded that claim 7 of the ’598 patent adds an inventive
`concept sufficient to ensure that the patent in practice amounts to
`significantly more than a patent on the abstract idea itself. Alice, 134 S. Ct.
`at 2355; see Accenture Global Servs., 728 F.3d at 1345 (holding claims
`directed to the abstract idea of “generating tasks [based on] rules . . . to be
`completed upon the occurrence of an event” to be unpatentable even when
`applied in a computer environment and within the insurance industry). The
`specification treats as well-known all potentially technical additions to the
`claim, including “interface,” “content data memory,” “use rule memory,”
`“program store,” “processor,” “code for storing,” and “code to provide”
`data. The linkage of existing hardware devices to existing payment
`validation processes and supplier-defined access rules appear to be “‘well-
`understood, routine, conventional activit[ies]’ previously known to the
`industry.” Alice, 134 S. Ct. at 2359; Mayo, 132 S. Ct. at 1294.
`Having considered the information provided in the Petition and the
`Preliminary Response, we are persuaded that Petitioner has demonstrated
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`that it is more likely than not that the challenged claim is unpatentable under
`35 U.S.C. § 101.
`
`D. Obviousness over Gruse, Stefik ’235 and Stefik ’980
`Petitioner argues that claim 7 is unpatentable under 35 U.S.C.
`§ 103(a) as obvious over Gruse and Stefik. Pet. 32–57.
`The ’598 patent claims priority to international PCT Application No.
`GB00104110 (“the ’110 Appln”), filed on October 25, 2000, which claims
`priority to UK Application No. 9925227.2 (“the GB application”), filed on
`October 25, 1999. Ex. 1001, 1:6–16. Gruse was published February 24,
`2000. Ex. 1006, 1.
`Petitioner’s § 103 challenge is based on a combination that includes
`Gruse. Pet. 32–57. According to Petitioner, Gruse is prior art to the
`Challenged Claims under 35 U.S.C. § 102(a)7 because the date of its
`publication—February 24, 2000—is before the earliest filing date to which
`the Challenged Claims are entitled—October 25, 2000 (the filing date of
`’110 Appln.). Pet. 4, 20. Petitioner’s position is that the Challenged Claims
`lack written description support in the GB application. Id. at 15–20. See
`Tech. Licensing Corp. v. Videotek, Inc., 545 F.3d 1316, 1327 (Fed. Cir.
`2008); Ariad Pharms. v. Eli Lilly and Co., 598 F.3d 1336, 1351 (Fed. Cir.
`2010) (en banc).
`Petitioner contends the GB application does not provide written
`description support for independent claim 1 and dependent claim 7. Pet. 19–
`20. Without the benefit of the GB application, Gruse is prior art to the
`
`
`7 The ’598 patent was filed prior to the effective date of the AIA § 102
`(March 16, 2013) and is governed by pre-AIA § 102(a). AIA § 3(n)(1).
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`challenged claims. Generally, Petitioner contends “the [GB application]’s8
`scant disclosure fails to support many limitations recited in the Challenged
`Claims.” Id. at 19. Specifically, Petitioner argues that the GB application
`does not support a limitation recited in claim 1, or a limitation recited in
`claim 7. Id. at 19–20.
`The priority dispute between the parties focuses on whether the GB
`application sufficiently supports the following limitations: (1) “portable data
`carrier comprising . . . ; content data memory … for storing one or more
`content data items on the carrier; use rule memory to store one or more use
`rules for said one or more content items…” (claim 1); and (2) “payment data
`memory to store payment data and code to provide the payment data to a
`payment validation system” (claim 7). Id. at 19–20. Patent Owner argues
`that claims 1 and 7 are supported by the GB application because the features
`alleged to be missing are disclosed in the GB application. Prelim. Resp. 17–
`18.
`
`With respect to the “content data memory” and “use rule memory”
`recited in claim 1, Patent Owner argues the limitations are supported by the
`following disclosure in the GB application:
`In one embodiment the data storage means is powered by the
`retrieval device when it is connected to the device and retains a
`memory of the downloaded data when it is unpowered.
`. . .
`The data storage means and/or the retrieval device can be
`provided with access control means to prevent unauthorised
`access to the downloaded data. Alternatively, this access
`control means can be used to stop or provide only limited
`access of the user to the downloaded data in accordance with
`
`8 Referred to herein as “the GB application.”
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`the amount paid. Thus, for example, a complete set of data
`information relating to a particular topic, a particular music
`track, or a particular software package might be downloaded,
`although access to part of the data set might thereafter be
`controlled by payments made by a user at a later stage. Thus, a
`user could pay to enable an extra level on a game or to enable
`further tracks of an album.
`Prelim. Resp. 17–18 (quoting Ex. 1008, 3–4). We are persuaded that this
`disclosure provides adequate support for the disputed limitations.
`Petitioner acknowledges that the GB application discloses that “access
`control information may be stored with the downloaded data or in separate
`storage area, for example in the payment validation means” (Ex. 1008, 4),
`but argues that the disclosed payment validation means is “away from the
`data carrier” and, therefore, “this description does not support storage of
`content data and use rules on the same data carrier.” Pet. 19–20. We
`disagree.
`Claim 1 of the GB application, for example, indicates that the
`“payment validation means” is part of the “data storage means” that stores
`“downloaded data.” Ex. 1008, 9. The GB application also discloses that
`“[t]he combination of the payment validation means with the data storage
`means allows the access to the downloaded data which is to be stored by the
`data storage means, to be made conditional upon checked and validated
`payment being made for the data.” Id. at 8. In addition, the GB application
`discloses card 30—i.e., the “portable data carrier” recited in claim 1—that
`has one set of contacts for interfacing with a payment validation means and
`another set of contacts for interfacing with downloaded data. Id. at 12 (“On
`the card (30) are two sets of contacts, contacts (32) for interfacing with the
`payment validation means and contacts (34) for interfacing with the memory
`
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`for storing downloaded data.”). Based on the disclosure described above,
`we are persuaded that the GB application “reasonably conveys to those
`skilled in the art that the inventor had possession” of claim 1’s “portable data
`carrier comprising . . . ; content data memory … for storing one or more
`content data items on the carrier; use rule memory to store one or more use
`rules for said one or more content items….” Ariad Pharms., 598 F.3d at
`1351.
`
`With respect to “payment data memory to store payment data and
`code to provide the payment data to a payment validation system,” recited in
`claim 7, Petitioner has not sufficiently persuaded us that the GB application
`likewise does not provide adequate written description support. Specifically,
`the GB application disclose a card with a payment validation means
`accessible by means an interface separate from the interface for downloaded
`data. Ex. 1008, 12. The payment validation means stores payment data,
`such as electronic cash, and provides that payment data to a payment
`validation system. Id. at 8, 10. For example, the GB application discloses
`that
`
`The payment validation means is, for example, means to
`validate payment with an external authority such as a bank or
`building society. The combination of the payment validation
`means with the data storage means allows the access to the
`downloaded data which is to be stored by the data storage
`means, to be made conditional upon checked and validated
`payment being made for the data
`…
`In one embodiment of the invention however, the payment
`validation means comprises e-cash - that is the payment
`validation means stores transaction value information on a cash
`value of transactions validatable by the data storage means. In
`simple terms, the data storage means can be a card which is
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`CBM2014-00193
`Patent 8,061,598 B2
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`charged up to a desired cash value (if necessary limited to a
`maximum value) at a suitable terminal. This might be an
`internet access terminal but could, more simply, be a device to
`accept the data storage card and to receive and count money
`deposited by the user to charge the card, writing update cash
`value information onto the card.
`Ex. 1008, 8.
`The terminal can directly validate payment - for example in the
`case of a smart card charged with electronic cash it can deduct a
`cash value from the card.
`Id. at 10. Based on the disclosure described above, we are persuaded that
`the GB application “reasonably conveys to those skilled in the art that the
`inventor had possession” of claim 7’s “payment data memory to store
`payment data and code to provide the payment data to a payment validation
`system.” Ariad Pharms., 598 F.3d at 1351.
`Therefore, we are not persuaded that Petitioner has shown sufficiently
`that challenged claim 7 is not entitled to the benefit of the GB application’s
`filing date. Because we are not persuaded that claim 7 is not entitled to a
`priority date of October 25, 1999, we are not persuaded that Gruse is prior
`art under 35 U.S.C. § 102(a).
`Accordingly, on this record, we are not persuaded that Petitioner has
`established that it is more likely than not that claim 7 is unpatentable as
`obvious over Gruse, Stefik ’235, and Stefik ’980.
`
`CONCLUSION
`For the foregoing reasons, we determine that the information
`presented in the Petition establishes that it is more likely than not that
`Petitioner would prevail in establishing the unpatentability of claim 7 of the
`’598 patent under 35 U.S.C. § 101, as discussed above.
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`The Board has not made a final determination on the patentability of
`the challenged claim.
`
`ORDER
`
`For the reasons given, it is:
`ORDERED that a covered business method patent review is instituted
`on the sole ground that claim 7 is directed to patent-ineligible subject matter
`under 35 U.S.C. § 101;
`FURTHER ORDERED that the trial is limited to the ground identified
`above. No other grounds are authorized; and
`FURTHER ORDERED that pursuant to 35 U.S.C. § 324(d) and
`37 C.F.R. § 42.4, notice is hereby given of the institution of a trial; the trial
`commencing on the entry date of this Order.
`
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`Patent 8,061,598 B2
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`PETITIONER:
`
`W. Karl Renner
`Thomas Rozylowicz
`FISH & RICHARDSON P.C.
`CBM39843-0006CP1@fr.com
`
`
`PATENT OWNER:
`
`Michael R. Casey
`J. Scott Davidson
`DAVIDSON BERQUIST JACKSON & GOWDEY LLP
`mcasey@dbjg.com
`jsd@dbjg.com
`
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